The Township finds that the streets and public
rights-of-way to be used by a franchisee for the operation of a cable
system within the boundaries of the franchise area granted by the
Township's issuance of a franchise are valuable public property acquired
and maintained by the county, state and Township at great expense
to the taxpayers on behalf of all residents. The Township further
finds that the grant of a franchise to use such streets and public
rights-of-way is a valuable property right without which a franchisee
would be required to invest substantial capital.
The administration of this chapter and the franchise
imposes upon the Township substantial and additional regulatory responsibilities
and expense. Accordingly, each franchisee receiving the approval of
the Board for the grant of a franchise shall pay to the Township a
franchise fee in the amount designated by the Board in the franchise
agreement, which amount shall in no event be less than 5% of its gross
annual revenues. In the event that federal law is amended to authorize
a franchise fee higher than 5%, the Township may, at its discretion,
direct the franchisee to pay the higher franchise fee as authorized
by law. The franchisee shall then comply upon 60 days' written notice.
A.
The franchise fee is in addition to taxes and payments
that the franchisee may be required to pay under any federal, state
or local law and to any tax, fee or assessment imposed by utilities
and cable operators for the use of their services, facilities and
equipment.
B.
Payment of the franchise fee made by franchisee to
the Township is not and shall not be considered in the nature of a
tax.
C.
Acceptance by the Township. No acceptance of any payment
by the Township shall be construed as a release or an accord and satisfaction
of any claim the Township may have for further or additional sums
payable as a franchise fee under this chapter or for the performance
of any other obligation of the franchisee.
D.
Failure to make required payment. In the event that
any franchise payment or recomputation amount is not made on or before
the date specified herein, the Township shall notify the franchisee
in writing. The Township may collect interest on the delinquent franchise
fee payment in the amount of 6% annually.
E.
Payments to be made quarterly. The franchise fee shall
be paid quarterly to the Township and shall commence as of the effective
date of the franchise, unless otherwise agreed in the franchise agreement.
The Township shall be furnished at the time of each payment with a
statement verified by a representative of the franchisee showing the
calculation of franchise fees in accordance with GAAP and based on
Gross Revenues received from the operation of the cable system to
provide cable service in the Township. Quarterly payments shall be
made to the Township no later than 45 days following March 30, June
30, September 30 and within 90 days of December 31. Quarterly computation
dates are the last days of March, June, September and December.
F.
The Township's right of inspection. The Township shall
have the right to inspect and copy, exclusive of proprietary information,
the franchisee's records and the right to audit and to recompute any
amounts determined to be payable pursuant to this chapter for a period
of four years from the date of payment. Audits shall be at the expense
of the Township unless the audit discloses an underpayment in excess
of 5%, in which case the costs of the audit shall be borne by the
franchisee as a cost incidental to the enforcement of the franchise
agreement. Upon the completion of any such audit by the Township,
the Township shall provide to the franchisee a final report setting
forth the Township's findings in detail, including any and all substantiating
documentation. In the event of an alleged underpayment, the franchisee
shall have 30 days from the receipt of the report to provide the Township
with a written response agreeing to or refusing the results of the
audit, including any substantiating documentation. Based on these
reports and responses, the parties shall agree on a "final settlement
amount." For the purposes of this Section, the term "final settlement
amount(s)" shall mean the agreed upon underpayment, if any, to the
Township by the franchisee as a result of such audit. If the parties
cannot agree on a final settlement amount, the parties shall submit
the dispute to a mutually agreed upon mediator within 60 days of reaching
an impasse. In the event an agreement is not reached at mediation,
either party may bring an action to have the disputed amount determined
by a court of law.
G.
Any final settlement amount(s) due to the Township
as a result of such audit shall be paid to the Township by the franchisee
within 30 days from the date the parties agree upon the final settlement
amount. Once the parties agree upon a final settlement amount and
such amount is paid by the franchisee, the Township shall have no
further rights to audit or challenge the payment for that period.
A.
Township not liable. The Township and the Board shall
not be liable for any injury, damage or costs, either direct or consequential,
to any person or property arising from the use, operation, condition
or maintenance of the franchisee's cable system, whether arising from
the operation of the cable system itself or its location within any
street or public rights-of-way.
B.
Franchisee's indemnification of Township. The franchisee
shall, at its sole cost and expense, indemnify, hold harmless and
defend the Township, the Board, and the Township's other officials,
boards, commissions, agents and employees against any and all claims,
suits, causes of action, proceedings and judgments for damages to
persons or to property or equitable relief arising out of the construction,
maintenance or operation of its cable system, the conduct of franchisee's
business in the Township, or any claim, cause of action, proceeding,
suit or judgment arising out of the franchisee's enjoyment or exercise
of a franchise granted hereunder, regardless of whether the act or
omission complained of is authorized, allowed or prohibited by this
chapter or a franchise Agreement, provided that the Township shall
first give the franchisee written notice of its obligation to indemnify
and defend the Township within 10 business days of receipt of a claim
or action pursuant to this section. This provision includes, but is
not limited to, the Township's reasonable attorneys' fees incurred
in defending against any such claim, suit or proceeding and claims
arising out of copyright infringements or a failure by the franchisee
to secure consents from the owners, authorized distributors or franchisees
of programs to be delivered by the cable system.
C.
Notice of claim. The Township shall promptly give
the franchisee written notice of any claim, suit or demand requiring
the franchisee's indemnification of the Township under the foregoing
subsections. The Township shall have the right, but not the obligation,
to participate through its attorney in any such claim, suit or proceeding
falling within the subject matter of the indemnification provisions
of this chapter. If the Township determines that it is necessary for
it to employ separate counsel, the costs for such separate counsel
shall be the sole responsibility of the Township.
A.
A franchisee shall maintain, and by its acceptance
of a franchise issued pursuant to this chapter specifically agrees
that it will maintain, throughout the entire term of the franchise
period, at least the following insurance coverages insuring the Township
and the franchisee: workers' compensation and employer liability insurance
to meet all requirements of the Pennsylvania Workers Compensation
Act and comprehensive general liability insurance covering the construction,
operation and maintenance of the cable system and the conduct of the
franchisee's business in the Township in the minimum amounts of:
(1)
One million dollars for property damage resulting
from any one accident or incident.
(2)
One million dollars for bodily injury or death to
any one person.
(3)
Two million dollars for bodily injury or death resulting
from any one accident or incident.
(4)
Two million dollars for all other types of liability.
B.
Qualifications of insurers. All insurance policies
shall be issued by companies qualified to do business in the Commonwealth
of Pennsylvania. All insurance policies shall be available for review
by the Township.
C.
At the time of acceptance of a franchise, the franchisee
shall furnish to the Township a certificate of insurance evidencing
compliance with the foregoing requirements and that such coverages
are in full force and effect. Renewal certificates shall be delivered
to the Township prior to the expiration of any periods of coverage.
D.
Limit of liability. Neither the provisions of this
section nor any damages recovered by the Township shall be construed
to limit the liability of the franchisee for damages under any franchise
issued hereunder.
A.
In addition to the other rights, powers and remedies
retained by the Township under this chapter or pursuant to the terms
of a franchise agreement, the Township reserves the separate and distinct
right to revoke this franchise if:
(1)
The franchisee practices any fraud or deceit upon
the Township in its operation of its cable system or any other activities
pursuant to this chapter;
(2)
The franchisee seeks, or an involuntary case is brought
against the franchisee seeking, liquidation, reorganization or other
relief under any bankruptcy, insolvency or other similar law or seeking
the appointment of a trustee, receiver, custodian or other similar
official of a substantial part of the franchisee's property and such
proceeding shall remain undismissed for a period of 60 days;
(3)
The franchisee transfers, assigns or changes the control
of the franchise, the cable system or any significant portion thereof,
or more than 25% of the equitable ownership of the cable system without
the consent of the Township;
(4)
The franchisee repeatedly fails, after notice and
opportunity to cure, to maintain signal quality pursuant to the standards
provided for by the FCC and imposed on the franchisee as technical
requirements in this chapter;
(5)
The franchisee repeatedly violates, after notice and
opportunity to cure, one or more of the material terms or conditions
of the franchise Agreement.
Upon execution of a franchise agreement executed
pursuant to this chapter, the franchisee shall post a performance
bond in an amount determined in the franchise agreement but in no
event less than $25,000 as surety for the faithful performance and
discharge by the franchisee of all obligations imposed by the franchise
agreement. The performance bond shall remain in force and effect throughout
the term of the franchise agreement and shall be issued by a surety
licensed to do business in the Commonwealth of Pennsylvania. The performance
bond shall provide that the Township may recover from the principal
and surety any and all damages incurred by the Township for the franchisee's
violation of the franchise agreement and the provisions of this chapter.
