Loading...
Ordinance 28370006.080.003 WSS/naa/srh/klt 05/23/91 R:05/29/91 ORDINANCE NO. 2817 AN ORDINANCE OF THE CITY OF EDMONDS, WASHINGTON, EXTENDING AND RENEWING A THREE-YEAR (3) NON- EXCLUSIVE COMMUNITY ANTENNA TELEVISION SYSTEM FRANCHISE TO EDMONDS CABLE COMPANY; PURSUANT TO CHAPTER 4.68 OF THE EDMONDS CITY CODE; AMENDING ECC SECTION 3.20.040 AND 3.20.050 TO ADD SUBPARAGRAPH (C) ADDING CABLE TELEVISION AS OCCUPATIONS SUBJECT TO THE UTILITY BUSINESS LICENSE AND OCCUPATION TAX IN ORDER TO EQUALIZE THE RATES PAID BY THE CITY'S FRANCHISEES; AND FIXING A TIME WHEN THE SAME SHALL BECOME EFFECTIVE. WHEREAS, in 1988 the City received notice from Edmonds Cable Company that it desired to renew its existing franchise with the City, and WHEREAS, the City Council then engaged a consultant and through his services and a series of public hearings has determined that: 1. The qualifications of Edmonds Cable Company meets the City's minimum criteria relating to its experience, legal status, character, financial stability and basic technological proficiency; 2. The applicant franchisee's staff, equipment and facilities available for service are adequate to meet the basic needs of the City; 3. The applicant is currently meeting the minimum technological standards established by Federal Communications Commissions; 4. The programming available is generally consistent with that sought by the citizens of the City of Edmonds; WSS53338O -1- 5. In order to approve the 10-15 year franchise sought by the applicant, the City requires assurances that in the event rate regulation is once again permitted by Congress and the Federal Communication Commission, the City will be able to regulate rates with respect to those services subscribed to by the average Edmonds consumer, and that technological developments will be incorporated in the franchisee's system at the same time as they are available in other systems of comparable size in the Puget Sound region. WHEREAS, following the period of evaluation, the parties began negotiations in 1990 in an attempt to negotiate a franchise which combined the long term assurances sought by the franchisee with the protections the City Council felt necessary to protect the subscribers within the City of Edmonds; and WHEREAS, in October of 1990 the City Council authorized its negotiators to notify the applicant that a franchise package had been approved subject to their acceptance; and WHEREAS, such package was rejected by the franchisee; and WHEREAS, after considerable further negotiation, the franchisee on April 17, 1991, provided to the City its last best offer with respect to a franchise; and WHEREAS, this last franchise proposal limits the definition of basic service and therefore those rates which would be subject to regulation by the City in the event Congress again authorized rate regulation to a minimum level that would not be meaningful to the average Edmonds' consumer, and also reserves to the franchisee the right to determine whether or not technological improvements would be incorporated in the system; and WSS53338O -2- WHEREAS, the franchisee's last best offer therefore does not meet the minimum standards established by the City Council at the onset of negotiation and therefore does not meet the needs of the public of the City of Edmonds; and WHEREAS, pursuant to Chapter 3.20 of the Edmonds City Code the utilities of the City of Edmonds, such as the Snohomish County Public Utility District, telephone businesses, natural gas purveyors and other utilities which utilize the City's rights -of - way and do business within the City, are subject to utility taxes in the form of business and occupation taxes ranging from 5-1/4% to 5-3/4%; and WHEREAS, the franchisee is currently paying a franchise tax of 3%; and WHEREAS, the City Council in order to defray the tens of thousand dollars which have been spent in the assessment of the franchisee and fruitless negotiations with the franchisee, as well as its upcoming and continued negotiations, and in order to equalize the taxes paid by various franchisees who utilize the City rights -of -way does hereby determine it appropriate to levy an additional utility equalization tax under Chapter 3.20 of 2% in order to bring the taxes paid by each utility franchisee into the same general range; and WHEREAS, the two critical issues of rate regulation and technology are both in a state of change which may be subj ect to clarification by Congress and the market place in the near term; and WSS53338O -3- WHEREAS, negotiations are at an impass and the Council finds that extension and renewal of the franchise for a period of three (3) years would allow the parties an opportunity to review their positions in light of Congressional action, the regulatory environment and changes in the technological capabilities available to franchisees, NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF EDMONDS, WASHINGTON, DO ORDAIN AS FOLLOWS: Section 1. A franchise extension and renewal is hereby granted to Edmonds Cable Company to operate a non-exclusive cable television franchise in accordance with provisions of Chapter 4.68 of the Edmonds City Code for a period of three (3) years commencing on the date of passage of this ordinance. The City Code Chapter has been in effect during and throughout the franchisee's prior period of operation, provided, however, that the ordinance provides in section 4.68.040 for the regulation of rates by the City. The rate regulation authority under section 4.68.040 has been voluntarily suspended by the City Council due to the actions of Congress in superseding the City's rate regulation authority. The City hereby reserves its right to again regulate rates in accordance with the pre-existing franchise and its current extension should Congress again authorize the City to regulate rates. Section 2. Section 3.20.040 "License tax year" of Chapter 3.20 "Business License and Occupation Tax" is hereby WSS533380 -4- amended by the addition of a new subparagraph (C) to read as follows: C. The occupation license levied on the City's cable television franchisee(s) shall include for the initial period of franchise if less than one calendar year, a partial tax year dating from the date of franchise approval or extension through December 31 of that calendar year. The franchisee shall pay a tax for the initial period equal to the pro -rated portion of the annual tax determined in accordance with the provisions of this chapter. Any partial concluding year shall be similarly prorated. Section 3. Section 3.20.050 "Occupations Subject to Tax - Amounts" is hereby amended by the addition of a new subsection (E) relating to Communication antenna television systems - franchisee - utilities equalization tax to read as follows: E. Pursuant to chapter 4.68 of the Edmonds City Code, Community Antenna Television Systems, commonly known as cable television franchisees, pay a franchise tax of 3%. In addition thereto, a tax is hereby levied equal to 2% of the gross receipts collected by the franchisee from the sale of its services in the City of Edmonds. This additional 2% is intended, when combined with the franchise fee of 3%, to provide a total of franchise fees and utility tax equalization amounts equal to 5% of the gross revenues of the franchisee derived from the sale of its cable television services within the City of Edmonds. Services shall include the sale of all broadcast services to subscribers, but shall not include revenues derived from the sale of advertising or other minor miscellaneous, incidental revenue unrelated to the sale of subscriber services or equipment rental. WSS53338O -5- Section 4. The Edmonds City Attorney and City's cable television consultant are hereby directed to prepare for Council review technical goals and consumer protection provisions. The technical goals may be adopted pursuant to ordinance and shall guide the City in evaluating during the next franchise term, the service provided by the franchisee. Establishment of these goals shall not be interpreted as an attempt to supersede the technical standards established by the Federal Communication Commission but rather to determine the franchisee's compliance with the representations which it has made to the City regarding the level of services which it can and will provide to its citizens. If in the future the City is permitted to impose higher standards, such standards shall control. A separate free-standing consumer protection ordinance shall be prepared by the City Attorney subject to the Council's review. This ordinance shall delineate both the rights of the subscriber and the obligations of the franchisee. Section 5. This ordinance, being an exercise of a power specifically delegated to the City legislative body, is not subject to referendum, and shall take effect five (5) days after passage and publication of the ordinance or a summary thereof consisting of the title. WSS53380O -6- ATTEST/AUTHENTICATED: .u, TY LERK, JACQUELINE G. PARRETT APPROVED AS TO FORM: OFFICE OF THE CITY ATTORNEY: BY FILED WITH THE CITY CLERK: May 30, 1991 PASSED BY THE CITY COUNCIL: May 28, 1991 PUBLISHED: June 9, 1991 EFFECTIVE DATE: June 14, 1991 ORDINANCE NO. 2837 WSS53338O -7- STATE OF WASHINGTON, COUNTY OF SNOHOMISH, On Me 2M doy of Moy MI the City Council of the 6y of Edmonds, passed Ord Ermnce No, 2837. A summory of the [oMent of sold Drdinance, consist" of the tkte, Provides as follows: A EX ' The Alit text of tfiis OrdEnonnc i wilt be mulled upon esl. DATED thlS Y&th doy Dt Moy, 1994 2ACOIJELINE G. PARRETT City Clark Published: Suno 4, 1"..1, ss. Affidavit of Publication The undersigned, being first duly sworn on oath deposes and says that she is Principal Clerk of THE HERALD, a daily newspaper printed and published in the City of Everett, County of Snohomish, and State of Washington; that said newspaper is a newspaper of general circulation in said County and State; that said newspaper has been approved as a legal newspaper by order of the Superior Court of Snohomish County and that the notice ...................................... Summary of Ordinance No. 2837 a printed copy of which is hereunto attached, was published in said newspaper proper and not in supplement form, in the regular and entire edition of said paper on the following days and times, namely: June 9, 1991 and that said newspaper was regularly distributed to its subscribers during all of said period. Principal Clerk 14th Subscribed and sworn to before me this ............................ day of......... June .... ............ 19...91. c n f�n� for the State of Washington, a Pug;iii i g at Everett, Snohomish County. 8-2-1