Franchise fee

(a)

The grantee, in consideration of the privilege granted under the franchise for the operation of a cable television system within the public ways of the city and the expense of regulation pursuant to the franchise incurred by the city, shall pay to the city five (5) percent of its annual gross revenues during the period of its operation under the franchise or the maximum amount as may be set from time to time by controlling federal or state law, if such maximum is less than five (5) percent. The fee may be subject to renegotiation at such time as applicable laws and regulations permit; provided that the city shall not require a franchise fee greater than five (5) percent of gross revenues to the extent that the fee has a substantial detrimental effect upon the economic feasibility of grantee's cable communications system; provided, further, that the grantee shall be entitled to adjust its rates to recover from subscribers and users any increase in the franchise fee adopted by the city pursuant to this section; alternatively, the grantee shall be required to adjust its rates to reflect the decrease in costs associated with any reduction in the franchise fee adopted by the city.

(b)

The grantee shall file with the city, within thirty (30) days after the expiration of each of the grantee's fiscal quarters, a financial statement clearly showing the gross revenues received by grantee during the preceding quarter, and shall simultaneously tender payment of the quarterly portion of the franchise fee. The grantee shall file, within one hundred twenty (120) days following the conclusion of the grantee's fiscal year, an annual certified audit, prepared and reported by a certified public accountant acceptable to the city, clearly showing the yearly total gross revenues. The annual report and audit shall be paid for by the grantee.

(c)

The city shall have the right, consistent with the provision of section 7-87(d), to inspect during normal business hours the grantee's income records, the right of audit and the recomputation of any amounts determined to be payable under this chapter. Any additional amount due the city as a result of the audit shall be paid within thirty (30) days following written notice to the grantee by the city, which notice shall include a copy of the audit report. The cost of the audit shall be borne by the grantee if it is properly determined that the grantee's annual payment due to the city for the preceding year is increased thereby by more than five (5) percent.

(d)

If any franchise payment or recomputed amount is not made on or before the applicable dates heretofore specified, interest shall be charged from such due date at the maximum rate allowed by law or one and one-half (1½) percent per month, whichever is greater.

(e)

If the franchise is terminated prior to its expiration date and the city invokes its rights to purchase the grantee's cable television system, the grantee shall file with the city, within thirty (30) days of the date that ownership and control passes to the city or its assignee, a financial statement clearly showing the gross revenues received by grantee since the end of the previous fiscal year, detailed by fiscal quarter. The grantee shall pay the franchise fee due at the time such statement is filed or within thirty (30) days, whichever is sooner. The fee shall include all expenses due to the city up to the actual date of cessation or transfer of service.

(Code 1971, § 52-42; Ord. No. 7864-A, § 1(Art. IV, § 12), 1-28-82)