Link to COMPETITIVE TELECOMMUNICATIONS
Sec. 7B-1. Short title.
Sec. 7B-2. Definitions.
Sec. 7B-3. Findings; purpose.
Sec. 7B-4. License application and agreement.
Sec. 7B-5. Franchise application and agreement.
Sec. 7B-6. Policy of innovation.
Sec. 7B-7. Time is of the essence.
Sec. 7B-8. License or franchise required.
Sec. 7B-9. Grant of authority.
Sec. 7B-10. Local regulatory framework.
Sec. 7B-11. Regulation costs.
Sec. 7B-12. Geographic area of the system.
Sec. 7B-13. Shared facilities.
Sec. 7B-14. Conditions of street occupancy.
Sec. 7B-15. Use, rental or lease of utility poles and facilities.
Sec. 7B-16. Construction and technical standards.
Sec. 7B-17. Provision of service and equipment to the city.
Sec. 7B-18. Renewal and termination.
Sec. 7B-19. Purchase of system by city.
Sec. 7B-20. Foreclosure and receivership.
Sec. 7B-21. Transfers and assignments.
Sec. 7B-22. Indemnification.
Sec. 7B-23. Insurance.
Sec. 7B-24. Bonding.
Sec. 7B-25. Security deposit.
Sec. 7B-26. License or franchise fee.
Sec. 7B-26.1. Alternative license fee for long distance only licenses.
Sec. 7B-27. Rights reserved to the city.
Sec. 7B-28. Nondiscrimination and equal employment opportunities.
Sec. 7B-29. Application for licenses and franchises.
Sec. 7B-30. Cost of consultant.
Sec. 7B-31. Damages.
Sec. 7B-32. Remedies, violation or civil infraction.
Sec. 7B-33. Severability.
Sec. 7B-34. Effective date; application to existing systems.
Sec. 7B-35. Permit moratorium.
Sec. 7B-36. Limited point-of-presence only licenses authorized.
Sec. 7B-37. Exemption for pre-statehood telecommunications providers.
Sec. 7B-38. No vested rights.
Sec. 7B-1. Short title.
This chapter shall be known and may be cited as the city of Tucson Competitive Telecommunications Code.
(Ord. No. 8522, § 1, 6-12-95)
Sec. 7B-2. Definitions.
For the purposes of this chapter, the following terms, phrases, words, and their derivatives shall have the meanings given herein. When not inconsistent with the context, words used in the present tense include the future, words in the plural number include the singular number, and words in the singular number include the plural number. The word “shall” is mandatory, and “may” is permissive. Words not defined herein or in the Arizona Public Service Law, A.R.S. sec. 40-201, et seq. or the Federal Communications Act of 1934, as amended, U.S. Code, Title 47, Chapter 5, shall be given their generally accepted meaning in the telecommunications industry.
Applicant means a person, as defined in this section, who submits a written response to the city’s request for proposals to provide competitive telecommunications service to the city.
City is the city of Tucson, a municipal corporation of the State of Arizona.
Competitive telecommunications service means the provision of long distance competitive access and/or any telecommunications service where customers of the service within the city have or are likely to have reasonably available alternatives, as determined by the mayor and council after public notice and opportunity to comment, or when so classified by the Arizona Corporation Commission by rule or order duly adopted and published.
Competitive telecommunications service does not include cable service, as defined in Section 602(6) of the Federal Cable Act, or the distribution of video programming directly to one or more of a multiplicity of subscribers to a cable system as defined in Section 602(7) of such federal act, 47 U.S.C. Sections 522(6), (7) which is subject to local governmental regulation under the Act.
Core system means that portion of the licensee’s/franchisee’s system as shown in the license/franchise agreement which constitutes the initial operating system of the licensee/franchisee.
FCC means the Federal Communications Commission or any legally designated successor.
Franchise means a grant of authority to a telecommunications company to place facilities in the public streets and other municipally owned rights-of-way pursuant to Section 7B-14 hereof for the purpose of providing competitive telecommunications services.
Sec. 7B-14. Conditions of street occupancy.
(a) The licensee or franchisee shall first obtain the written approval of the city engineer prior to commencing construction on the streets and public places of the city. Approval shall be in accordance with relevant Charter and Code provisions and administrative regulations, which approval shall not be unreasonably withheld. The licensee or franchisee shall notify the city at least ten (10) days prior to the commencement of any construction in any streets.
(b) The licensee or franchisee shall not open or disturb the surface of any street or public place for any purpose without first having obtained a permit to do so in the manner provided by law. All excavation shall be coordinated with other utility excavation or construction so as to minimize disruption to the public. Licenses or franchises hereunder shall join and participate in the local blue stake center.
(c) Use of existing poles or conduits.
(1) The licensee or franchisee shall utilize existing poles, conduits and other facilities whenever possible and shall not construct or install any new, different or additional above- ground poles, conduits or other facilities whether on public property or on privately owned property, unless the erection of new poles is authorized by the city manager or the city manager’s designee. Nothing in this section shall prohibit the replacement of existing poles or the addition of poles on existing above-ground routes where engineering concerns mandate the addition of new poles to accommodate the licensee’s/franchisee’s facilities.
(2) The facilities of the licensee or franchisee shall be installed underground in those areas of the city where existing telephone and electric services are both underground at the time of construction by the licensee or franchisee. In areas where either telephone or electric utility facilities are installed aerially at the time of system construction, the licensee or franchisee may install its facilities aerially; however, at such time as the existing aerial facilities are placed underground, the licensee or franchisee shall likewise place its facilities underground at sole cost to the licensee or franchisee.
(d) All transmission and distribution structures, lines and equipment erected by the licensee or franchisee shall be located so as to cause minimum interference with the unencumbered use of streets and other public places and minimum interference with the rights and reasonable convenience of property owners who adjoin any of the streets and public places.
(e) The licensee or franchisee shall at its own expense repair, to the satisfaction of the city, all city-owned water lines, storm and sanitary sewer lines, service lines, water meters, streets, sidewalks, curbs, gutters, or other property of the city damaged by any of the operations of the licensee or franchisee, its contractors, subcontractors, employees, agents or assigns engaged in pursuant to its license or franchise. In case of disturbance or damage caused by the licensee or franchisee to any street or public place, the licensee or franchisee shall, at its own cost and expense and in the manner approved by the city, replace and restore such street or public place in as good a condition as before the work performed by the licensee or franchisee which caused such disturbance or damage.
(f) At any time during the period of the license or franchise, the licensee or franchisee shall, at its own expense, protect, support, temporarily disconnect, relocate or remove any of its property when, in the opinion of the city, the same is required by reason of traffic conditions, public safety, street vacation, freeway or street construction, alteration to or establishment of any street, sidewalk or other public place, installation of sewers, drains, waterlines, power lines, traffic signal lines or transportation facilities.
(g) The licensee or franchisee shall, on request of any person holding a permit to move a building, temporarily remove, raise or lower its wires to permit the movement of such buildings. The expense of such temporary removal or raising or lowering of wires shall be paid by the person requesting the same, and the licensee or franchisee shall have the authority to require such payment in advance. The licensee or franchisee shall be given not less than five (5) days’ advance notice to arrange such temporary wire alterations.
(h) Whenever, in case of fire or other emergency, it becomes necessary in the judgment of the city manager, police chief, fire chief, or their delegates, to remove or damage any of the licensee or franchisee’s facilities, no charge shall be made by the licensee or franchisee against the city for restoration and repair.
(i) The licensee or franchisee shall have the authority to trim trees on public property at its own expense as may be necessary to protect its wires and facilities, subject to supervision and direction by the city. Trimming of trees or private property shall require written consent of the property owner.
(j) Protection of facilities. Nothing contained in this Section shall relieve any person from liability arising out of the failure to exercise reasonable care to avoid damaging the licensee or franchisee’s facilities while performing any work connected with grading, regrading or changing the line of any street or public place or the construction or reconstruction of any sewer or water system.
(k) Notice of city improvements. The city shall provide the licensee or franchisee with reasonable notice of plans for street or other public improvements where paving or resurfacing of a permanent nature is involved. The notice shall contain the nature and character of the improvements, the streets upon which the improvements are to be made, the extent of the improvements and the work schedule for the project. The notice shall give the licensee or franchisee sufficient time to make any additions, alterations, modifications or repairs to its facilities as the licensee or franchisee deems necessary in advance of the commencement of the work, so as to permit the licensee or franchisee to maintain continuity of service.
(l) The licensee or franchisee, in conjunction with the requirements of a city project, shall at its sole expense make such relocations of its facilities within city rights-of-way or take other steps as may be necessary to facilitate any city project. Such relocations shall be under the same terms and conditions as a new installation pursuant to this chapter.
(Ord. No. 8522, § 1, 6-12-95; Ord. No. 8545, § 3, 7-10-95)
Gross annual revenues means all cash, credits, property of any kind or nature, or other consideration received directly or indirectly by the licensee or franchisee, its affiliates, subsidiaries, parent and any person in which the licensee or franchisee has a financial interest, arising from or attributable to the sale or exchange of long distance competitive access or competitive telecommunications services by the licensee within the city or in any way derived from the operation of its system, including, but not limited to:
(1) All telecommunications service revenues charged on a flat rate basis;
(2) All telecommunications services charged on a usage sensitive or mileage basis;
(3) All revenues from installation service charges;
(4) All revenues from connection or disconnection fees;
(5) All revenues from penalties or charges to customers for checks returned from banks, net of bank costs paid;
(6) All revenues from equipment sold or rented to customer upon customer premises;
(7) All revenues from local and long distance full rate service;
(8) All revenues from authorized rental of conduit space;
(9) All revenues from charges for access to local and long distance networks;
(10) All revenues from any leases or subleases of any portion of licensee/franchisee’s network, including plant, facilities, or capacity leased to others for any other purpose;
(11) All other revenues collected by licensee/franchisee from business pursued within the city; and
(12) All recoveries of bad debts previously written off and revenues from the sale or assignment of bad debts.
This sum shall be the basis for computing the fee imposed pursuant to section 7B-26 (“License Fee”).
License means that ordinance or resolution which contains the right, authority or grant, given by a licensing authority enabling the license holder to provide long distance competitive access or competitive telecommunications services.
Licensee means a person who, in accordance with the provisions of this chapter and the city’s request for proposals, executes a license agreement with the city for the nonexclusive privilege to provide long distance competitive access service in the city.
Long distance competitive access service means the instantaneous transmission for hire of voice or data signals by digital high speed fiber optic transmission capacity to carry interstate voice and data signals only to (a) carry interexchange carrier traffic between interexchange carrier points of presence, or (b) to connect customer locations to interexchange carrier points of presence.
Mayor and council means the governing body of the city. They are the licensing and franchising authority.
Person includes any individual, partnership, association, corporation, legal entity or organization of any kind. Whenever used in any clause prescribing a penalty, the term “person” as applied to partnerships or associations includes partners or members thereof, and if applied to corporations, the officers thereof.
Proposal means an applicant’s formal written response to the city’s request for proposals to provide long distance competitive services or telecommunications service to the city, pursuant to this chapter. Upon award by the city of a license or franchise, the proposal shall become part of the license or franchise agreement.
Street means the surface, the air space above the surface and the area below the surface of any public streets, roadways, highways, avenues, lanes, alleys, courts, places, curbs, sidewalks, easements, rights-of-way, or other public ways in the city which have been or may hereafter be dedicated to or otherwise acquired by the city.
Telecommunications company means any person providing long distance competitive access or competitive telecommunication services as a public service corporation, as defined in the Arizona Constitution, Article 15, Section 2, that provides telecommunications services in the public rights-of-way of the city.
Telecommunications service means any transmission of interactive switched and non- switched signs, signals, writing, images, sounds, messages, data or other information of any nature by wire, radio lightwave, or any other electromagnetic means (including access services), which originate or terminate in the city and are offered to or for the public, or some portion thereof, for compensation.
(Ord. No. 8522, § 1, 6-12-95; Ord. No. 8545, § 1, 7-10-95)
Sec. 7B-3. Findings; purpose.
(a) The mayor and council finds that the city’s streets constitute valuable public property,
(1) Having been acquired and maintained by the city over many years at taxpayer expense;
(2) Being capable of providing rights-of-way uniquely valuable to private companies in their respective businesses for providing telecommunications services for hire;
(3) Constituting public investments for which the taxpayers are entitled to a fair monetary return on the city’s past and future investment in the city’s infrastructure; and
(4) Comprising significant assets which should be managed fairly and appropriately to enhance the public safety and economy.
(b) Therefore, this chapter is intended:
(1) To regulate the provision of long distance competitive access services and competitive telecommunications services within the jurisdiction of the city;
(2) To provide for the payment of certain fees; and other valuable considerations to the city to allow the construction, operation, use and development of the system within the city;
(3) To provide conditions under which the system will serve present and future needs of government, public institutions, commercial enterprises, lawful public and private organizations, and the citizens and general public of the city; and
(4) To provide remedies and prescribe penalties for any violation of this chapter.
(Ord. No. 8522, § 1, 6-12-95)
Sec. 7B-4. License application and agreement.
(a) Application for license. Any applicant desiring a license to occupy the streets and other municipal rights-of-way of the city to operate a long distance competitive access service shall file an application with the department of information services in the form prescribed by the department and shall pay the filing fee prescribed by this chapter. Such application shall be processed in accord with A.R.S. Section 9-563 and section 7B-29 below.
(b) License agreement. Prior to, or in no event later than sixty (60) days after written notification of the award of a license by the city, the selected applicant shall execute a license agreement which shall set forth the terms and provisions of the license. The license agreement shall be subject to all provisions of this chapter and shall incorporate all terms and provisions included in the licensee’s proposal. The licensee shall provide all that is set forth in its proposal to provide long distance competitive access service within the city. In case of any conflict or ambiguity between the terms of the license agreement and this chapter, that provision which provides the greatest benefit to the city, in the sole opinion of the city, shall govern. The license agreement may be amended only in writing upon mutual agreement of the city and licensee provided, however, that the city reserves the right to amend this ordinance to reflect or accommodate local concerns, or changes in the Arizona Revised Statutes and rules or orders of the Arizona Corporation Commission or the Federal Communications Commission pertaining to telecommunications services and providers and to conform any license issued hereunder accordingly.
(Ord. No. 8522, § 1, 6-12-95; Ord. No. 8545, § 2, 7-10-95)
Sec. 7B-5. Franchise application and agreement.
(a) Application for franchise. Any applicant desiring a franchise to occupy the streets and other municipal rights-of-way of the city to operate facilities to provide competitive telecommunications services shall file an application with the department of information services in the form prescribed by the department and pay the filing fee prescribed by this chapter. Such application shall be processed in accordance with paragraph (b) of this subsection and Section 7B-29 below.
(b) Franchise election. Upon finding that the application is in good order, the department of information services shall promptly notify the applicant of its determination and advise it to pay a franchise election fee to the city clerk in an amount to be determined by the city clerk within a specified number of days thereafter. Upon the city clerk’s receipt of the fee, the city clerk shall cause a franchise election to be scheduled at the next date as determined by the mayor and council.
(c) Franchise agreement. Within sixty (60) days after notification of acceptance of the terms of the franchise by the city, the applicant shall execute a franchise agreement which shall set forth the terms and provisions of the franchise and which shall be submitted to the electorate pursuant to subsection (b) above. The franchise agreement shall be subject to all provisions of this chapter and shall incorporate all terms and provisions included in the applicant’s proposal. In case of any conflict or ambiguity between the terms of the franchise agreement and this chapter, that provision which provides the greatest benefit to the city, in the sole opinion of the city, shall govern. The franchise agreement may be amended only in writing upon mutual agreement between the city and the franchisee and upon approval of the electorate; provided, however, that the city reserves the right to amend this ordinance to reflect or accommodate local concerns, changes in the Arizona Revised Statutes and rules or orders of the Arizona Corporation Commission or the Federal Communications Commission pertaining to telecommunications services and providers and to conform any franchise issued hereunder accordingly.
(Ord. No. 8522, § 1, 6-12-95)
Sec. 7B-6. Policy of innovation.
Recognizing the fluid and expanding state of the development of communications technology and uses, it is the policy of the city to strongly encourage experimentation and innovation in the development of system uses, services, and techniques that will be of general benefit to the community; provided that all such experiments and innovations shall be subject to the rules of the FCC and any other state and city laws.
(Ord. No. 8522, § 1, 6-12-95)
Sec. 7B-7. Time is of the essence.
Whenever this chapter or the license or franchise agreement sets forth any time for any act to be performed by the licensee or franchisee, such time shall be deemed of the essence; and the licensee’s failure to perform within the time allotted shall, in all cases, be sufficient grounds for the city to invoke the remedies available under the terms and conditions of this chapter and the license or franchise agreement.
(Ord. No. 8522, § 1, 6-12-95)
Sec. 7B-8. License or franchise required.
(a) License or franchise required. No person shall provide competitive telecommunications services within the city, unless a license or franchise has first been granted by the mayor and council pursuant to the provisions of this chapter, and unless the license or franchise agreement is in full force and effect. No applications for a license or franchise shall be considered unless the city has first requested proposals in the form and in the manner prescribed by the city. Nothing in this chapter shall be deemed to require the granting of any license or franchise when in the opinion of the city it would not be in the public interest to do so.
(b) License or franchise nonexclusive. Any license or franchise granted pursuant to this chapter by the city shall not be exclusive, and the city specifically reserves the right to grant other licenses or franchises to any persons at any time and in any area of the city if the city determines that the granting of additional licenses or franchises are in the public interest.
(c) License or franchise binding. All provisions of this chapter and any license or franchise agreement shall be binding upon the licensee or franchisee, its successors, lessees or assignees.
(Ord. No. 8522, § 1, 6-12-95)
Sec. 7B-9. Grant of authority.
(a) Length of license or franchise. Any license or franchise granted by the city pursuant to this chapter shall commence upon execution of the license or franchise agreement by the license or franchisee and the city and shall be for a period of fifteen (15) years, subject to the conditions and restrictions as provided in this chapter. A license or franchise agreement may be renewed pursuant to the provisions of section 7B-18 (“Renewal and Termination”) of this chapter. No privilege or exemption shall be inferred from the granting of any license or franchise unless it is specifically prescribed.
(b) No right of property. The granting of any license or franchise pursuant to this chapter shall be a privilege and shall not impart to the license or franchisee any right of property in any city street or other city property.
(c) Subject to city police powers and other regulatory agencies’ rules and regulations. The licensee or franchisee shall, at all times during the term of the license or franchise agreement, be subject to all lawful exercise of the police power by the city, including any and all ordinances, rules, or regulations which the city has adopted or may adopt applying to the public generally and to the licensee or franchisee, and all laws, rules, regulations, orders, and policies of the state and the United States Government. Any conflict between the provisions of this chapter and any other present or future lawful exercise of the city police powers shall be resolved in favor of the latter.
(Ord. No. 8522, § 1, 6-12-95)
Sec. 7B-10. Local regulatory framework.
(a) Continuing regulatory jurisdiction. The mayor and council shall have continuing regulatory jurisdiction and supervision over the operation of any license or franchise granted pursuant to this chapter. However, it is recognized that the daily administrative, supervisory, and enforcement responsibilities of the provisions of this chapter and the license or franchise agreement shall be delegated and entrusted to the city Manager as hereafter provided.
(b) The city manager or the city manager’s designee, as appropriate, shall have the following responsibilities and authority:
(1) To interpret, administer and enforce the provisions of this chapter and the license or franchise agreement;
(2) To represent the city in all matters pertaining to the implementation of the provisions of this chapter and the license or franchise agreement;
(3) To review and audit reports and other documents submitted to the city as required by this chapter or other law, so as to ensure that the necessary reports are completed and fulfilled pursuant to the terms of this chapter;
(4) To assure that all records, rules and charges pertinent to the system are made available for inspection at reasonable hours upon reasonable notice;
(5) To confer with the licensee or franchisee and advise and supervise the interconnection and compatibility of the system with other systems in the city;
(6) To establish and administer sanctions as authorized by the mayor and council to ensure compliance with this chapter;
(7) To advise the mayor and council on matters which may constitute grounds for termination of the license or franchise agreement in accordance with this chapter;
(8) To advise the mayor and council on proposed transfers of the system;
(9) To promulgate regulations regarding the construction, reconstruction, operation, maintenance, dismantling, testing or use of the system as necessary;
(10) To ensure that the licensee or franchisee makes all services available to all residents of the city on a nondiscriminatory basis;
(11) To perform any other duties assigned under the provisions of this chapter or other legislation which may hereafter be enacted by the mayor and council or such other related duties as the mayor and council may direct.
(Ord. No. 8522, § 1, 6-12-95)
Sec. 7B-11. Regulation costs.
The cost of regulating the license or franchisee shall be paid out of revenue derived from license or franchise fees provided for by section 7B-26 of this chapter. Until such time as the license or franchise fees generated are in an amount sufficient to cover the cost of regulation and other city costs associated with the implementation of this chapter, all as determined by the mayor and council, as such costs and expenses as approved and budgeted by the mayor and council shall be an assessment against the licensee or franchisee and shall be paid within fifteen (15) days, written notice to the licensee or franchisee of the amount due. Amounts so assessed and paid shall be a credit against future license or franchise fee payments pro rata.
(Ord. No. 8522, § 1, 6-12-95)
Sec. 7B-12. Geographic area of the system.
The geographic area of the license or franchise shall include all portions of the city’s jurisdiction specifically set forth within the license or franchise.
(Ord. No. 8522, § 1, 6-12-95)
Sec. 7B-13. Shared facilities.
(a) To maximize public and employee safety, to minimize visual clutter of aerial plant, and to minimize the amount of trenching and excavation in and along city streets and sidewalks for underground plant, telecommunications companies licensed hereunder shall make every commercially reasonable effort to interconnect or to collectively “bundle” compatible facilities within the right-of-way subject to the engineering requirements of the owners of utility poles and other facilities used by the licensee or franchisee.
(b) In the event of a dispute between licensees or franchisees regarding compatibility of facilities or reasonableness of interconnection requirements, the matter shall be submitted to the city manager or the city manager’s designee for determination, whose decision shall be final and binding upon the respective licensees or franchisees; however, this section shall not govern disputes between a licensee or franchisee under this chapter and a licensee or franchisee of the city who does not provide competitive telecommunications service.
(Ord. No. 8522, § 1, 6-12-95)
Sec. 7B-14. Conditions of street occupancy.
(a) The licensee or franchisee shall first obtain the written approval of the city engineer prior to commencing construction on the streets and public places of the city. Approval shall be in accordance with relevant Charter and Code provisions and administrative regulations, which approval shall not be unreasonably withheld. The licensee or franchisee shall notify the city at least ten (10) days prior to the commencement of any construction in any streets.
(b) The licensee or franchisee shall not open or disturb the surface of any street or public place for any purpose without first having obtained a permit to do so in the manner provided by law. All excavation shall be coordinated with other utility excavation or construction so as to minimize disruption to the public. Licenses or franchises hereunder shall join and participate in the local blue stake center.
(c) Use of existing poles or conduits.
(1) The licensee or franchisee shall utilize existing poles, conduits and other facilities whenever possible and shall not construct or install any new, different or additional above- ground poles, conduits or other facilities whether on public property or on privately owned property, unless the erection of new poles is authorized by the city manager or the city manager’s designee. Nothing in this section shall prohibit the replacement of existing poles or the addition of poles on existing above-ground routes where engineering concerns mandate the addition of new poles to accommodate the licensee’s/franchisee’s facilities.
(2) The facilities of the licensee or franchisee shall be installed underground in those areas of the city where existing telephone and electric services are both underground at the time of construction by the licensee or franchisee. In areas where either telephone or electric utility facilities are installed aerially at the time of system construction, the licensee or franchisee may install its facilities aerially; however, at such time as the existing aerial facilities are placed underground, the licensee or franchisee shall likewise place its facilities underground at sole cost to the licensee or franchisee.
(d) All transmission and distribution structures, lines and equipment erected by the licensee or franchisee shall be located so as to cause minimum interference with the unencumbered use of streets and other public places and minimum interference with the rights and reasonable convenience of property owners who adjoin any of the streets and public places.
(e) The licensee or franchisee shall at its own expense repair, to the satisfaction of the city, all city-owned water lines, storm and sanitary sewer lines, service lines, water meters, streets, sidewalks, curbs, gutters, or other property of the city damaged by any of the operations of the licensee or franchisee, its contractors, subcontractors, employees, agents or assigns engaged in pursuant to its license or franchise. In case of disturbance or damage caused by the licensee or franchisee to any street or public place, the licensee or franchisee shall, at its own cost and expense and in the manner approved by the city, replace and restore such street or public place in as good a condition as before the work performed by the licensee or franchisee which caused such disturbance or damage.
(f) At any time during the period of the license or franchise, the licensee or franchisee shall, at its own expense, protect, support, temporarily disconnect, relocate or remove any of its property when, in the opinion of the city, the same is required by reason of traffic conditions, public safety, street vacation, freeway or street construction, alteration to or establishment of any street, sidewalk or other public place, installation of sewers, drains, waterlines, power lines, traffic signal lines or transportation facilities.
(g) The licensee or franchisee shall, on request of any person holding a permit to move a building, temporarily remove, raise or lower its wires to permit the movement of such buildings. The expense of such temporary removal or raising or lowering of wires shall be paid by the person requesting the same, and the licensee or franchisee shall have the authority to require such payment in advance. The licensee or franchisee shall be given not less than five (5) days’ advance notice to arrange such temporary wire alterations.
(h) Whenever, in case of fire or other emergency, it becomes necessary in the judgment of the city manager, police chief, fire chief, or their delegates, to remove or damage any of the licensee or franchisee’s facilities, no charge shall be made by the licensee or franchisee against the city for restoration and repair.
(i) The licensee or franchisee shall have the authority to trim trees on public property at its own expense as may be necessary to protect its wires and facilities, subject to supervision and direction by the city. Trimming of trees or private property shall require written consent of the property owner.
(j) Protection of facilities. Nothing contained in this Section shall relieve any person from liability arising out of the failure to exercise reasonable care to avoid damaging the licensee or franchisee’s facilities while performing any work connected with grading, regrading or changing the line of any street or public place or the construction or reconstruction of any sewer or water system.
(k) Notice of city improvements. The city shall provide the licensee or franchisee with reasonable notice of plans for street or other public improvements where paving or resurfacing of a permanent nature is involved. The notice shall contain the nature and character of the improvements, the streets upon which the improvements are to be made, the extent of the improvements and the work schedule for the project. The notice shall give the licensee or franchisee sufficient time to make any additions, alterations, modifications or repairs to its facilities as the licensee or franchisee deems necessary in advance of the commencement of the work, so as to permit the licensee or franchisee to maintain continuity of service.
(l) The licensee or franchisee, in conjunction with the requirements of a city project, shall at its sole expense make such relocations of its facilities within city rights-of-way or take other steps as may be necessary to facilitate any city project. Such relocations shall be under the same terms and conditions as a new installation pursuant to this chapter.
(Ord. No. 8522, § 1, 6-12-95; Ord. No. 8545, § 3, 7-10-95)
Sec. 7B-15. Use, rental or lease of utility poles and facilities.
The licensee or franchisee assumes all responsibility for gaining permission from any electric, gas or telephone utility or any other authorized entity in the city for the use, rental or lease of poles, underground conduits and other structures and facilities for the purpose of extending, carrying or laying the licensee or franchisee’s wires, cables, electronic conductors and other facilities and appurtenances necessary or desirable in conjunction with the establishment and operation of the system. The city agrees that any public utility owning or controlling such poles or underground conduits may, without amendment to any franchise agreement it may have with the city, allow and is encouraged to allow the licensee or franchisee to make such use thereof pursuant to any agreement reached between such utility and the licensee or franchisee.
(Ord. No. 8522, § 1, 6-12-95; Ord. No. 8545, § 4, 7-10-95)
Sec. 7B-16. Construction and technical standards.
Compliance with construction codes.
(1) Construction practices shall be in accordance with all applicable provisions of the Occupational Safety and Health Act of 1970 and any amendments thereto as well as all applicable laws, rules and regulations of the state and the city, including but not limited to requirements of the city in regard to various electrical wiring necessary to the operation of city functions, including but not limited to traffic-control signalization, street lighting, fire lines and communications lines.
(2) All installation of electronic equipment shall be of a permanent nature, durable and installed in accordance with the applicable provisions of the current editions of the National Electrical Safety Code as published by the Institute of Electrical and Electronics Engineers, the National Electrical Code of the National Fire Protection Association, and all state and local codes where applicable.
(3) Antenna supporting structures (towers) shall be painted, lighted, erected and maintained in accordance with all applicable rules and regulations of the United States Department of Transportation and all other applicable laws, rules and regulations of the state and the city.
(Ord. No. 8522, § 1, 6-12-95)
Sec. 7B-17. Provision of services and equipment to city.
As a condition of granting a license or franchise to a licensee or franchisee hereunder, the city may require that such licensee or franchisee agree to make available at no cost to the city such dark fibers and spares in any cable or bundle of fibers hung or emplaced by such licensee or franchisee as the city may reasonably need to satisfy municipal telecommunications requirements. The licensee or franchisee shall bring such fibers to a board, block, or pedestal such as to be readily accessible and usable by the city, as determined by the department of information services and at no cost to the city, unless otherwise provided in the terms of a specific license or franchise agreement. In addition, the license or franchise may specify that certain telecommunications services and other facilities be provided to the city at licensee’s or franchisee’s cost, or at a discount from established prices, or on a most favored nation basis.
(Ord. No. 8522, § 1, 6-12-95; Ord. No. 8545, § 5,** 7-10-95**)
Sec. 7B-18. Renewal and termination.
(a) Renewal. At any time between the last five and twelve months before expiration of its existing license or franchise, the licensee or franchisee, as the case may be, may apply to the city for continuation of its existing authority to occupy the city streets and other municipal rights-of-way. If the applicant shows to the satisfaction of the city that it is in compliance with the terms of its existing instrument, the city may grant a five-year extension of the existing authorization, subject to the right of either party to renegotiate fees, conditions, and terms of access and subject to the approval of the voters of the city in the case of a franchise.
(b) Termination.
(1) The mayor and council may terminate the license or franchise agreement in the event of the violation of any material provision of this chapter or of any rule or regulation promulgated pursuant thereto or of any applicable federal, state or local law, or the material breach, failure, refusal or neglect by the license or franchisee to perform its obligations under the terms and conditions of the license or franchise agreement, except when such violation, breach, failure, refusal or neglect is directly caused by any of the following:
a. Acts of God;
b. Riots;
c. Emergencies declared by the President of the United States of America, the governor of the state or the mayor.
(2) Criteria for termination shall include, but in no event be deemed exclusive or limited to the following:
a. Attempt to dispose of any of the facilities or property of the system to prevent the city from purchasing it, as provided for in this chapter;
b. Attempt to evade any material provision of this chapter or the license or franchise agreement;
c. The practice of any fraud or deceit upon the city or subscribers or users;
d. Failure to begin or complete system construction or system extension pursuant to this chapter and the license or franchise agreement;
e. Failure to provide and maintain the types of services, facilities, equipment or personnel provided for in the license or franchise agreement and this chapter;
f. Material misrepresentation of fact in the license or franchisee’s proposal or in the execution of the license or franchise agreement or in any reports required to be filed pursuant to this chapter;
g. Failure to timely make payment of any moneys due the city pursuant to this chapter.
(3) After providing the licensee or franchisee with notice and an opportunity to be heard and in the event that the mayor and council determine that the licensee or franchisee, by its acts or omissions has given the city cause for termination of the license or franchise agreement, the mayor and council may instruct the city manager to make written demand upon the licensee or franchisee for full compliance. If the violation, breach, failure, refusal or neglect is not or cannot be remedied to the satisfaction of the mayor and council within thirty (30) days following such demand, if made, the mayor and council may exercise the following options:
a. Direct the licensee or franchisee to comply within such additional time, in such manner and upon such terms and conditions as the mayor and council may direct.
b. Declare the license or franchise agreement terminated and of no further force and effect.
(4) If the mayor and council declare the license or franchise agreement terminated, the city may pursue any remedies available to the city pursuant to this chapter, including but not limited to the options stated in paragraph (b) of section 7B-18 (“Renewal and Termination”), the license or franchise agreement, or any other remedy available to the city as provided by law.
(c) Dismantle. In the event that the city exercises its option to require the licensee or franchisee to dismantle the system, the licensee or franchisee shall, in an expeditious manner, at its own expense and at the direction of the city, restore any property, public or private, to the condition in which it existed prior to the erection or construction of the system, including any improvements made to such property subsequent to the construction of the system.
(d) Abandonment. In the event the license or franchise granted hereunder shall terminate without renewal or substitution, or the licensee or franchisee shall permanently abandon operations of its telecommunications facilities in the city, the city, at its election, may require the licensee or franchisee to remove some or all of its facilities hereunder or may exercise its right of purchase under section 7B-19 below. The city, however, shall be deemed to have a possessory interest in facilities provided by the licensee or franchisee under section 7B-17 above, which possessory interest shall not be disturbed by licensee or franchisee without the city’s consent.
(Ord. No. 8522, § 1, 6-12-95)
Sec. 7B-19. Purchase of system by city.
(a) Rights to purchase. In the event the city terminates the license or franchise agreement pursuant to any provisions of this chapter, or in the event the licensee or franchisee permanently abandons operation of its facilities within the city in whole or in part, the city shall have the first option, directly or as an intermediary, to purchase the system. The city shall have ninety (90) days prior to the effective date of expiration or termination to notify the licensee or franchisee and the utility to whom the licensee’s or franchisee’s equipment is attached of the city’s intent to exercise the option to purchase stated herein.
(b) Valuation. In the event of a termination of the license or franchise agreement by the city, the value of the system shall be solely based on the book value of the tangible assets of the system. Upon normal expiration of the license or franchise agreement the value of the system shall be solely based on the fair market value of the tangible assets of the system.
(1) “Book value” is defined as the original or historical cost of the assets less accumulated depreciation.
(2) No value shall be assigned to either the license or franchise itself, the license or franchise agreement or any right, privilege or expectancy arising out of the privilege to transact business under the license or franchise and the license or franchise agreement nor shall any value be assigned to goodwill or as a going concern.
(3) “Valuation” as referred to above shall be determined by audit of system assets pursuant to generally accepted auditing principles, and shall be performed by a certified public accounting firm selected by the city at the licensee or franchisee’s expense. In the event of permanent abandonment of all or some of licensee or franchisee’s facilities by the licensee or franchisee, such facilities shall be valued pro tanto at zero dollars for the purposes of this section.
(c) Date of valuation. The date of valuation shall be the effective date of expiration or termination of the license or franchise agreement or abandonment of the facilities.
(d) Transfer to city. Upon exercise of the city’s option to purchase and written notice of such action by the city upon the licensee or franchisee, the licensee or franchisee shall, immediately upon payment of the purchase price by the city, transfer to the city possession and legal title to all system facilities and property, both real and personal, free from any and all liens and encumbrances not agreed to be assumed by the city in lieu of a portion of the purchase price; and the licensee or franchisee shall execute such warranty deeds or other instruments of conveyance to the city as shall be necessary to effectuate this transfer.
(Ord. No. 8522, § 1, 6-12-95; Ord. No. 8545, § 6, 7-10-95)
Sec. 7B-20. Foreclosure and receivership.
(a) In the case of a foreclosure or other judicial sale or termination of lease of the plant, property or equipment of the licensee and franchisee, or any part thereof, or any rights under the license and franchise agreement, the licensee and franchisee shall serve written notice upon the city of any such event; and the city may serve written notice of termination upon the licensee and franchisee and the successful bidder at such sale, in which event the license and franchise and the license and franchise agreement and all rights and privileges of the licensee and franchisee thereunder shall cease and terminate thirty (30) days after service of such notice, unless:
(1) The mayor and council have approved the transfer of ownership of the license and franchise, in accordance with all pertinent provisions of section 7B-21 (“Transfers and Assignments”); and
(2) Such successful bidder shall have covenanted and agreed with the city, in writing in a form approved by the city attorney, to assume and be bound by all the terms and conditions of this chapter and the license and franchise agreement.
(b) The city shall have the right to terminate the license and franchise agreement one hundred twenty (120) days after the appointment of a receiver, or trustee, to take over and conduct the business of the licensee and franchisee, whether in receivership, reorganization, bankruptcy or other related action or proceeding, unless such receivership or trusteeship shall have been vacated prior to the expiration of one hundred twenty (120) days, or unless:
(1) Within one hundred twenty (120) days after their election or appointment, such receiver or trustee shall have fully complied with all the provisions of this chapter and the license and franchise agreement, and remedied any and all defaults or breaches thereunder; and
(2) Such receiver or trustee, within one hundred twenty (120) days, shall have executed an agreement, in a form approved by the city Attorney and duly approved by the court having jurisdiction over the proceedings, whereby such receiver or trustee assumes and agrees to be bound by each and every provision of this chapter and the license or franchise agreement.
(c) Failure to comply with the provisions of paragraph (a) of this section shall be deemed an unauthorized transfer pursuant to the provisions of section 7B-21 (“Transfers and Assignments”).
(Ord. No. 8522, § 1, 6-12-95)
Sec. 7B-21. Transfers and assignments.
(a) The licensee or franchisee shall not sell, transfer, assign, exchange or release, or permit the sale, transfer, assignment, exchange or release of more than three (3) percent of the ownership of the system or rights in the license or franchise agreement to a person (hereinafter “proposed transferee”), without the prior written authorization of the mayor and council. For purposes of this section, a merger or consolidation shall be deemed a transfer or assignment.
A secured debt financing arrangement in which the lender assumes the ownership position of the licensee, but not the operation of the licensee’s system, shall not be deemed a transfer or assignment pursuant to this section. However, no such lender may subsequently take over operation of the system without the prior written authorization of the city obtained pursuant to this section.
(1) In seeking prior written authorization, the licensee or franchisee shall have the obligation:
a. To inform the city as to whether the proposed transferee, which, in the case of a corporation, shall include all officers, directors, employees and all persons having a legal or equitable interest of five (5) percent or more of its voting stock, or any of the proposed transferee’s principals:
1. Has ever been convicted of a crime relating to fitness, trustworthiness or competence including any felony, or any misdemeanor involving moral turpitude, including, but not limited to, criminal fraud or deceit, or is presently under an indictment charging such a crime;
2. Has ever had a judgment in an action for fraud, deceit or misrepresentation entered against it, her, him or them by any court of competent jurisdiction; or
3. Has pending any legal claim or lawsuit arising out of or involving a fiber optics or cable communications system.
b. To establish to the satisfaction of the city the financial solvency of the proposed transferee by submitting all current financial information of the proposed transferee which the licensee or franchisee was required to submit in its proposal for the license or franchise agreement, and such other financial data as the city may request.
c. To establish to the satisfaction of the city that the proposed transferee has the experience and ability to fully comply with all provisions of this chapter and the license or franchise agreement and to effectively operate and maintain the system.
(2) The mayor and council specifically reserve the right to deny, restrict or condition authorization to transfer upon the criteria stated in this section and any other criteria the mayor and council determine to be necessary in the public interest.
(b) Any proposed transferee shall execute an agreement, in such form acceptable to the city attorney, that it will assume and be bound by all of the provisions, terms and conditions of this chapter, the license or franchise agreement, and any other conditions the mayor and council may have required in granting authorization.
(c) The occurrence of an unauthorized transfer or assignment may, at the option of the city, provide the mayor and council with cause to immediately terminate the license or franchise agreement and accelerate all of the obligations and rights as provided in section 7B-18 (“Renewal and Termination”).
(d) From and after any occurrence constituting an unauthorized transfer or assignment, the licensee or franchisee shall not make, execute or enter into any deed, deed of trust, mortgage, contract, conditional sales contract or any loan, lease, pledge, security agreement, sale, pole agreement or any other agreement or hypothecation concerning any system facilities or property, whether real or personal, without the written approval of the mayor and council.
(e) Nothing in this section shall be deemed to prohibit the use of the licensee’s property as collateral for security in regard to construction financing. However, any such financing arrangements shall be subject to all provisions of this chapter and the license or franchise agreement.
(f) No person at any time shall directly or indirectly hold more than one license or more than one franchise under this chapter. Any person holding two or more such instruments of authorization shall promptly surrender all but one such instrument to the department of information services or the city may declare any or all of them forfeited.
(Ord. No. 8522, § 1, 6-12-95; Ord. No. 8545, § 7, 7-10-95)
Sec. 7B-22. Indemnification.
(a) The licensee or franchisee shall indemnify, save harmless and defend the city, its mayor and council, appointed boards and commissions, officers and employees, individually and collectively from all fines, liens, suits, claims, demands, actions, costs of litigation, attorneys’ fees, judgments or liability of any kind (including but not limited to libel, slander, invasion of privacy, unauthorized use of any trademark, trade name or service mark, copyright infringement, injury, death or damage to person or property) arising out of or in any way connected with the installation, construction, operation, maintenance or condition of the system. The licensee or franchisee shall assume all risks in the operation of the system and shall be solely responsible and answerable for any and all accidents or injuries to persons or property arising out of the performance of the license or franchise agreement. The amounts and types of insurance coverage requirements set forth in section 7B-23 (“Insurance”) shall in no way be construed as limiting the scope of indemnity set forth in this section.
(b) Should any of licensee or franchisee’s facilities installed pursuant to this chapter be damaged or destroyed by the city, its agents, employees, contractors or subcontractors, the licensee or franchisee shall repair or replace such facilities at its own expense and shall waive any right, claim, or action for damages or other available remedies which it may have against the city, its agents, employees, contractors or subcontractors, except as to intentional, willful, or malicious damage to licensee or franchisee’s property by city employees acting outside the scope of their employment or by other parties acting without the express consent of the city.
(Ord. No. 8522, § 1, 6-12-95)
Sec. 7B-23. Insurance.
Prior to the commencement of any operation, excavation or construction pursuant to a license or franchise, the license or franchisee shall file with the city manager and maintain in full force and effect throughout the term of the license or franchise agreement insurance policies issued by an insurer duly authorized to conduct business in this state, insuring with respect to the installation, construction, operation and maintenance of the system as follows:
(1) Comprehensive general and automobile liability coverage including, but not limited to: (1) blanket contractual liability; (2) completed operations liability; (3) broad form property damage endorsement, including but not limited to coverage for explosion, collapse and underground hazard; and (4) automobile non-ownership liability. This insurance shall be written in the following minimum amounts:
a. For bodily injury, including death: $500,000.00 combined single limit;
b. Property damage: $500,000.00 combined single limit;
c. Comprehensive automobile liability; bodily injury: $500,000.00 combined single limit;
d. Excess umbrella liability in the minimum amount of $10,000,000.00.
(2) Workers’ compensation coverage as required by the laws, rules and regulations of this state.
(3) All insurance policies required herein shall include the city as an additional named insured.
(4) With respect to the insurance required herein, the license or franchisee shall be solely responsible for all premiums due and payable.
(5) The insurance policies required by this section shall contain the following endorsement:
It is hereby understood and agreed that this policy of insurance may not be canceled by the insurer nor the intention not to renew be stated by the insurer until sixty (60) days after receipt by the city, by registered mail, of written notice of such intent to cancel or not to renew.
(6) All insurance policies required to be procured herein shall be in a form approved by the city risk manager, and no licensee or franchisee may initiate or begin construction until such approval has been granted.
(7) Licensee or franchisee shall require of all its contractors and subcontractors the same insurance coverage including worker’s compensation insurance in the amounts required by state law.
(Ord. No. 8522, § 1, 6-12-95)
Sec. 7B-24. Bonding.
Performance bond. Within thirty (30) days after written notification of the award of a license or franchise by the city, the selected applicant shall file with the city a performance bond for the benefit of the city in the amount of one million dollars ($1,000,000.00) to be effective upon the execution of the license or franchise agreement and conditioned that in the event that the licensee or franchisee fails to comply with any provision of this chapter, the license or franchise agreement or other law applicable to the license or franchise, then there shall be recoverable jointly and severally from the principals and surety any and all damages or costs suffered or incurred by the city, including but not limited to attorney’s fees and costs of any action or proceeding, and including the full amount of any compensation, indemnification, cost of removal or abandonment of any property or other costs due and owing the city up to the full principal amount of such bond. The performance bond shall be maintained in full as a continuing obligation during the period of network construction for licensee/franchisee’s core network. The performance bond shall be issued by a surety company authorized to do business in this state and shall be in a form approved by the city attorney.
(1) The performance bond shall contain the following endorsement:
It is hereby understood and agreed that this bond may not be canceled by the surety nor the intention not to renew be stated by the surety until sixty (60) days after receipt by the city of Tucson, by registered mail, of written notice of such intent to cancel or not to renew.
(2) None of the provisions of this section or section 7B-25 (“Security Deposit”), nor any damages recovered by the city thereunder, shall be construed to excuse the faithful performance by or limit the liability of the licensee or franchisee.
(3) Upon application to the city, the licensee or franchisee shall be entitled to the return of the performance bond at the expiration of the license or franchise agreement or any renewal thereof, provided there is then no outstanding default or moneys due the city by the licensee or franchisee, and subject to license or franchisee’s obligation to remove abandoned facilities under section. 7B-18 above.
(Ord. No. 8522, § 1, 6-12-95; Ord. No. 8545, § 8, 7-10-95)
Sec. 7B-25. Security deposit.
(a) Within thirty (30) days after written notification of the award of a license or franchise by the city, the selected applicant shall deposit with the finance director of the city, and maintain on deposit throughout the term of the license or franchise agreement, a security deposit in the sum of fifty thousand dollars ($50,000.00) in cash or in the form of a letter of credit, bond, or alternative form of security acceptable to the city as security for the faithful performance by the licensee or franchisee of all provisions of this chapter and the license or franchise agreement and compliance with all orders, permits and directions of any agency or department of the city having jurisdiction over the licensee’s or franchisee’s operations.
(b) Within fifteen (15) days after written notice to the licensee or franchisee by the city that the city has withdrawn any amount or taken other steps to draw upon the security in the security deposit, the licensee or franchisee shall deposit or pay to the finance director a sum of money or other alternative form of security sufficient to restore such security deposit to the original amount of fifty thousand dollars ($50,000.00).
(c) If the licensee or franchisee fails to pay the city any moneys due within the time fixed in this chapter or the license or franchise agreement; or fails after ten (10) days’ written notice to pay to the city any taxes due and unpaid; or fails to repay to the city within ten (10) days’ written notice any damages, penalties, costs or expenses which the city may be compelled to pay by reason of any act, omission or default of the licensee or franchisee; or fails, after ten (10) days’ written notice, to comply with any provision of this chapter or the license or franchise agreement which the city reasonably determines can be remedied or partially cured by an expenditure or calling of the security within the security deposit, the finance director may immediately withdraw or call the amount thereof, with interest and any penalties, from the security deposit. Upon such withdrawal, the finance director shall in writing notify the licensee or franchisee of the amount and date thereof. In the event the security deposit is insufficient to pay the city for any compensation, damage, penalties, costs or expenses owing to the city pursuant to this chapter or the license or franchise agreement, the performance bond may be drawn upon by the city for any amount due the city over and above the amount held in the security deposit.
(d) The security deposit, including any interest that may have accrued, shall become the property of the city in the event that a license or franchise agreement is terminated by the city by reason of a violation of this chapter or breach of the license or franchise agreement pursuant to the provisions of section 7B-18 (“Renewal and Termination”).
(e) Upon application to the city, the licensee or franchisee shall be entitled to the return of all moneys or other form of security remaining in the security deposit, including accrued interest, at the expiration of the license or franchise agreement or any renewal thereof, provided there is then no outstanding default or moneys owing on the part of the licensee or franchisee to the city.
(f) The rights reserved to the city with respect to the security deposit are in addition to all other rights of the city, whether reserved by the license or franchise, this chapter or authorized by law; and no action, proceeding or exercise of a right with respect to such security deposit shall affect any other right the city may have.
(Ord. No. 8522, § 1, 6-12-95; Ord. No. 8545, § 9, 7-10-95)
Sec. 7B-26. License or franchise fee.
(a) Unless a license or franchise provides otherwise, as compensation for the rights and privileges herein conferred, licensee/franchisee shall pay to the city each calendar quarter during the term of this agreement a quarterly payment equal to five (5) percent of the total quarterly gross receipts (as defined below) received by the licensee/franchisee for services provided to customers within the corporate limits of the city from the provision of competitive telecommunications service within the city. During the initial fifteen (15) month buildout period or until licensee’s/franchisee’s core system is operational, the minimum fee payable hereunder shall be not less than three thousand dollars ($3,000.00) per quarter for the first four (4) quarters following execution of this agreement, and ten thousand dollars ($10,000.00) per quarter for every quarter thereafter. The quarterly payments required by this section shall be due and payable not later than noon of the last day of the month following the quarter for which payment is due. If the last day of the month following the quarter for which payment is due falls on a weekend or holiday, then the payment is due at noon on the last preceding business day prior to the last day of the month. The compensation set forth in this subsection (a) shall be exclusive of, and in addition to, any application fees or election costs or other costs established by the Code, chapter 7B, and all special assessments and taxes of whatever nature, including, but not limited to, business privilege, and ad valorem taxes. Notwith-standing the foregoing sentence, all license or franchise fees paid by licensee or franchisee pursuant to this section shall be credited towards the payment of the public utility tax levied pursuant to article III of chapter 19 of this Code. In the event any quarterly payment is not timely made, licensee/franchisee shall pay a late payment penalty of the greater of: (i) one hundred dollar ($100.00) per day or (ii) simple interest at ten (10) percent annual percentage rate of the total amount past due. As used in this section, gross revenues shall be as defined in section 7B-2, “gross annual revenues” of this chapter.
(b) Payment of money under this section shall not in any way limit or inhibit any of the privileges or rights of the city under any license or franchise or otherwise.
(c) Licensee/franchisee shall file annually with the city finance director, no later than four (4) months after the end of the licensee/franchisee’s fiscal year, a statement of revenues (for that year) attributable to the operations of the licensee/franchisee’s network within the city pursuant to this agreement. This statement shall present, in a form prescribed or approved by the city, a detailed breakdown of gross revenues and uncollectible accounts for the fiscal year. This statement shall be audited at no cost to the city by a certified public accountant chosen by licensee/franchisee whose report shall accompany the statement. The city may cause an additional audit to be performed by an auditor selected by the city not more frequently than every third year and licensee/franchisee shall reimburse the city for reasonable costs of such additional audit as determined by the city in the event the audit determines that additional revenues are due and owing to the city.
(d) Any transactions which have the effect of circumventing payment of required license or franchise fees and/or evasion of payment of license or franchise fees by noncollection or nonreporting of gross receipts, bartering, or any other means which evade the actual collection of revenues for business pursued by licensee/franchisee are prohibited.
(e) For the purpose of securing to the city the payments of license or franchise fees that may be owed, the city may require a licensee/franchisee to provide city with a bond, letter of credit or other evidence of security agreeable to city approximating the amount of license or franchise fees to be paid by licensee/franchisee for a two (2) year period. In the event of any default by licensee/franchisee in the payment of required license or franchise fees, such security shall be reviewed by city and a greater level of security agreed to and established for the remainder of the term of the license or franchise.
(f) For the further purpose of securing to the city the license or franchise fee payments that may be owed, the city shall have a lien and the same shall be a charge upon all of the property, estate, and effects of the licensee or franchisee, whatsoever, real, personal, or mixed, provided, however, that such lien shall remain inchoate until notice of default has been given by the city to the licensee or franchisee pursuant to section 7B-18 of this chapter, the licensee or franchisee has failed to take appropriate steps to remedy the default, and the city has filed an appropriate civil action to enforce such lien. Such lien shall be subordinate to any mortgage or deed of trust securing any bona fide indebtedness. The foregoing does not limit the city’s rights to enforce the terms of a license and franchise as otherwise provided in chapter 7B of the Code.
(g) Nothing in this section shall be interpreted to require payment of any fee, or agreement to any franchise or license fee that the city is prohibited from enforcing under A.R.S. § 9-582.
(Ord. No. 8522, § 1, 6-12-95; Ord. No. 8545, § 10, 7-10-95; Ord. No. 9911, 11-10-03)
Sec. 7B-26.1. Alternative license fee for long distance only licenses.
Notwithstanding the provisions of section 7B-26, licensees for long distance competitive- access service who do not meet the twenty (20) linear mile limitation contained in section 7B-36 of this chapter but who connect only to interstate telecommunication carrier points of presence and to no other connection within the city may, as an alternative to the license fees specified in section 7B-26, pay a fee for each linear foot of installation within city rights-of-way on a basis determined by the mayor and council at the time of the granting of the license.
(Ord. No. 9444, § 1, 8-7-00; Ord. No. 10317, § 1, 9-12-06)
Sec. 7B-27. Rights reserved to the city.
(a) Without limitation upon the rights which the city might otherwise have, the city does hereby expressly reserve the following rights, powers and authorities:
(1) To exercise its governmental powers now or hereafter to the full extent that such powers may be vested in or granted to the city.
(2) To determine any question of fact relating to the meaning, terms, obligations or other aspects of this chapter and the license or franchise agreement.
(3) To grant multiple nonexclusive licenses or franchises within the city to other persons for the operation of systems pursuant to this chapter.
(4) To inspect and supervise all construction or installation work performed by the licensee or franchisee.
(b) The city hereby expressly reserves the right to amend any section or part of this chapter for any reason determined to be desirable or necessary by the mayor and council in the exercise of its legislative powers, including, but not limited to, new developments in the state of the technology of the communications industry and changes in federal or state laws, rules or regulations, provided that any such amendments are reasonable. Such amendments shall be adopted only after a public hearing where the licensee or franchisee shall have received written notice at least thirty (30) days prior to the hearing and is provided an opportunity to be heard.
(c) Nothing in this chapter shall be deemed or construed to impair or affect the right of the city to exercise its power of eminent domain to acquire the property of the licensee or franchisee at a fair and just value, which shall not include any amount for the license or franchise itself or any privilege thereunder.
(d) The city reserves the right, during the term of the license or franchise agreement, to install and utilize, upon the pole attachments and conduits of the licensee or franchisee, any wire or pole fixtures required for municipal purposes, without cost to the city so long as such installation and utilization does not interfere with the operation of the system. If such utilization causes the utility to whom the licensee’s or franchisee’s equipment is attached to incur costs or expenses, the licensee or franchisee shall bear all such costs actually incurred by such utility.
(Ord. No. 8522, § 1, 6-12-95; Ord. No. 8545, § 11, 7-10-95)
Sec. 7B-28. Nondiscrimination and equal employment opportunities.
The licensee or franchisee shall not deny service, access or otherwise discriminate against subscribers, users or any resident of the city. In this regard, the licensee or franchisee shall comply with the human relations provisions of this Code, section 17-21, incorporated herein by this reference. The licensee or franchisee shall strictly adhere to the equal employment opportunity requirements of the FCC. The licensee or franchisee shall comply at all times with all other applicable federal, state and City laws, rules and regulations, and all executive and administrative orders relating to nondiscrimination.
(Ord. No. 8522, § 1, 6-12-95)
Sec. 7B-29. Applications for licenses or franchises.
(a) Any person submitting a proposal in response to the city’s request for proposals shall provide all information required by this chapter and all other information as may be solicited in the city’s request for proposals or otherwise required by the city. Each proposal shall be responsive to the questions soliciting the information and shall completely, accurately and materially supply all of the information so solicited. Any misrepresentation, failure, neglect or refusal to provide any of such information may at the option of the city render a proposal invalid and it may be given no consideration. The requested information must be complete and verified as true by the applicant.
(b) All proposals received by the city from the applicants shall become the sole property of the city.
(c) The city reserves the right to reject any and all proposals and to waive all informalities where the best interest of the city may be served.
(d) Before submitting a proposal, each applicant shall be solely responsible for and must: (1) examine this chapter and the request for proposal documents thoroughly; (2) be familiar with local conditions that may in any manner affect performance under the license or franchise, including but in no event limited to relevant demographics, topographics, pole attachment policies of appropriate utility authorities, undergrounding, and subscriber and user desires; (3) be familiar with federal, state and local laws, ordinances, rules and regulations affecting performance under the license or franchise; and (4) carefully correlate all observations with the requirements of this chapter and the request for proposal documents.
(e) The city may make such investigations as it deems necessary to determine the ability of the applicant to perform under the license or franchise agreement, and the applicant shall furnish to the city all such information and date for this purpose as the city may request. The city reserves the right to reject any proposal if the evidence submitted by or investigation of such applicant fails to satisfy the city that such applicant is properly qualified to carry out the obligations of the license or franchise agreement, to comply with the provisions of this chapter, or to satisfactorily construct and operate the system. Conditional proposals shall not be accepted.
(f) Application fees.
(1) In addition to any franchise fees, and notwithstanding any other requirement of this chapter, each applicant must furnish with its proposal a nonrefundable filing fee in the amount of seventy-five hundred dollars ($7,500.00) by certified or cashiers check made payable to the city. No proposal for a license or franchise shall be considered without receipt of such check.
(2) All checks received will be deposited to an account of the city and will serve to recover all expenses incurred by the city in the preparation and granting of the license or franchise, the execution of the license or franchise agreement and regulation of the licensee or franchisee pursuant to this chapter. Such expenses shall include but not be limited to any and all publication costs, consultant’s expenses and the reasonable value of services performed by the city’s employees, agents or contractors.
(3) In the event that the city’s expenses in connection with the application and selection process exceed the total amount of filing fees collected from the applicants, the applicant awarded the license or franchise shall pay to the city (pro rata in the event more than one (1) applicant is awarded a license or franchise) the excess amount, not to exceed fifty thousand dollars ($50,000.00) within sixty (60) days of demand by the city.
(g) Application for a license or franchise pursuant to this chapter constitutes a consent by the applicant to the surrendering of any and all preexisting licenses or franchises for the provision of any aspect of competitive telecommunications services previously granted by the city. Upon the granting of a license or franchise pursuant to this chapter, the applicant shall forthwith surrender any and all such existing licenses or franchises to the city, and any and all such licenses or franchises shall be superceded by the license or franchise granted pursuant to this chapter.
(h) Any and all decisions of the mayor and council concerning licensee or franchisee selection shall be final.
(Ord. No. 8522, § 1, 6-12-95; Ord. No. 8545, § 12, 7-10-95)
Sec. 7B-30. Cost of consultant.
In addition to any required franchise fees, and notwithstanding any other payment required by this chapter or the license or franchise agreement, when necessary to aid in the analysis of matters relating to the system, including, but not limited to, rate investigations and regulation, technical standards, construction supervision or market surveys in the city, the city shall be entitled to employ the services of a consultant to assist and advise the city manager and the mayor and council. All reasonable fees of the consultant incurred by the city in this regard shall be shared equally by the licensee or franchisee and the city, regardless of the nature or outcome of any specific matter under consideration. The terms of this section shall not apply to any research cost incurred by the city in connection with the right of the city to purchase the system.
(Ord. No. 8522, § 1, 6-12-95)
Sec. 7B-31. Damages.
By execution of the license or franchise agreement, the licensee or franchisee agrees that failure to comply with the provisions of this chapter and the license or franchise agreement will result in damage to the city, and that it will be impracticable to determine the actual amount of such damage; and that, in addition to any other damages suffered by the city or remedies available to it, the licensee or franchisee will pay to the city the following amounts chargeable by the city to the security deposit established in section 7B-25 (“Security Deposit”) of this chapter:
(1) For failure to timely file required plans, data or reports pursuant to this chapter and the license or franchise agreement, per day . . . . . $ 50.00
(2) For failure to comply with reasonable orders of the city, per day . . . . . 50.00
(3) For failure to complete construction or commence operations pursuant to this chapter and the license or franchise agreement, per day . . . . . 350.00
(4) For failure to provide the services proposed by the licensee or franchisee pursuant to the provisions of this chapter and incorporated into the license or franchise agreement, per day . . . . . 350.00
(5) For failure to timely pay the license or franchise fee or other moneys due the city pursuant to this chapter and the license or franchise agreement, per day . . . . . 250.00
(Ord. No. 8522, § 1, 6-12-95; Ord. No. 8545, § 13, 7-10-95)
Sec. 7B-32. Remedies, violation a civil infraction.
(a) Where this chapter provides alternative penalties or remedies, they shall be cumulative; and the imposition of one penalty or remedy shall not prevent the imposition of any other penalty or remedy provided for.
(b) It shall be a civil infraction for any person to violate any of the provisions of this chapter. Any person found liable for violating any provision of this chapter or any rule or regulation promulgated hereunder shall be subject to a civil penalty of not less than one hundred dollars ($100.00) nor more than one thousand dollars ($1,000.00) for each offense. Each day of a continuing violation shall constitute a separate and distinct civil infraction.
(Ord. No. 8522, § 1, 6-12-95)
Sec. 7B-33. Severability.
If any provision, section, paragraph, sentence, clause, or phrase of this chapter is for any reason held to be invalid or unconstitutional, such invalidity or unconstitutionality shall not affect the validity of the remaining portions of this chapter. It is the intent of the city in adopting this chapter that no portion or provision thereof shall become inoperative or fail by reason of any invalidity or unconstitutionality of any other portion or provision, and to this end all provisions of this chapter are declared to be severable.
(Ord. No. 8522, § 1, 6-12-95)
Sec. 7B-34. Application to existing systems.
In any case where a person had been previously granted a non-exclusive license or franchise for telecommunications facilities for the purpose of providing local linkage to long distance telecommunications services and that person or an assignee, duly consented to by the mayor and council, is validly operating under the terms thereof, such licensee or franchisee may continue to provide such local linkage in strict accord with its terms over existing facilities. No permits for further expansion of existing facilities will be granted without an application under this chapter. Any renewal of such continuing license, however, shall be in accord with the provisions of this chapter. At any time within one year of the enactment of this ordinance, however, the licensee or franchisee may elect to bring itself under the provisions of this chapter for the balance of the term of the subsisting license, and the terms of the subsisting license shall be deemed to conform to this chapter.
(Ord. No. 8522, § 1, 6-12-95)
Sec. 7B-35. Permit moratorium.
No sooner than thirty (30) days from the date of adoption of this chapter, the city shall examine whether equal access to the capability for fiber optic facility attachments to utility poles or other facilities of other city-franchised entities exists within the city. In the event that the city determines, in its sole discretion, that equal access to pole or other utility facility attachments does not exist at such time, the city shall forthwith impose a permit moratorium upon the issuance of all new street excavation, right-of-way excavation, or other construction or installation permits for all fiber optic installations within the city relating to such facilities, including permits for modification of existing facilities. Such moratorium shall also have the effect of cancelling any existing permit for any fiber optic licensee which allows attachment to any such pole or other utility facility attachments of other city-franchised entities within the city for the duration of such moratorium. The moratorium imposed pursuant to this section shall remain in effect until the city determines, in its sole discretion, that equal access exists within the city for pole or other utility facility attachments for fiber optic communications facilities.
(Ord. No. 8522, § 1, 6-12-95; Ord. No. 8545, § 14, 7-10-95)
Sec. 7B-36. Limited point-of-presence only licenses authorized.
The mayor and council may issue limited non-exclusive licenses pursuant to the authority of A.R.S. § 9-561, et seq., to authorize placement of interstate fiber optic telecommunications facilities within city rights-of-way in the event the facilities do not exceed twenty (20) linear miles in total length of installation and connect only to interstate telecommunication carrier points of presence, and to no other connection within the city. Notwithstanding any other provision of this chapter, said licenses shall provide for payment to the city of a right-of-way occupancy fee for each linear foot of installation on a basis determined by the mayor and council at the time of the granting of the license, and shall contain such other terms and conditions as the mayor and council may approve.
(Ord. No. 8936, § 1, 9-2-97; Ord. No. 10317, § 2, 9-12-06)
Sec. 7B-37. Exemption for pre-statehood telecommunications providers.
The provisions of this chapter 7B shall not apply to any telecommunications provider in connection with the provision of wireline local exchange services who is providing, and with its predecessors-in-interest has been continuously providing, local exchange service within the city since prior to February 14, 1912, under a claim of a territorial franchise.
(Ord. No. 9909, § 1, 11-3-03)
Sec. 7B-38. No vested rights.
The exemptions in this chapter shall not be interpreted to create vested rights in any person.
(Ord. No. 9909, § 2, 11-3-03)
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