G-05-04-28-9B1 - 4/28/2005ORDINANCE NO. g-05- 01 -1 -an -9Q I
AN ORDINANCE AMENDING ORDINANCE NO. G -01-11-20-12A1, A
FRANCHISE GRANTED TO GRANDE COMMUNICATIONS, INC.
RELATING TO THE DELIVERY OF CABLE SERVICES; SAID
AMENDMENT REVISING THE FRANCHISE FEE PERCENTAGE, AND
CONTAINING OTHER PROVISIONS
BE IT ORDAINED BY THE COUNCIL OF THE CITY OF ROUND ROCK,
TEXAS:
I.
FINDINGS
A. The City Council finds that Ordinance No. G -01-11-20-12A1, adopted on November 20,
2001, granted a cable television franchise to Grande Communications, Inc. ("Grande
Cable Franchise").
B. The City Council finds that the referenced Grande Cable Franchise had four percent (4%)
of defined gross revenue as the franchise fee percentage, which was consistent at the time
of adoption with the franchise agreement of the incumbent cable provider, Time Warner
Entertainment-Advance/Newhouse Partnership d/b/a Time Warner Cable ("Time Warner
Cable"), but was lower than the federally permitted franchise fee of five percent (5%) of
gross revenue, as allowed by 47 USC Sec. 542.
C. The City Council finds that it was anticipated when the Grande Cable Franchise was
adopted that there would be a revised cable franchise with Time Warner Cable ("Time
Warner Renewal Cable Franchise") which would increase the franchise fee to the
maximum federal level of five percent (5%); however, due to current pending state
legislation, Time Warner Cable has requested that the City delay adoption of Time
Warner Renewal Cable Franchise until January 2006, but the City and Time Warner
Cable affirm that there is agreement between the parties to amend the Time Warner Cable
Franchise at this time to increase the Time Warner Franchise Fee to five percent (5%),
and that such agreement is embodied in an amendment to the Time Warner Cable
Franchise ("Time Warner Cable Franchise Amendment") which is also being presented
to City Council for adoption contemporaneous with this amendment to the Grande Cable
Franchise.
D. The City Council finds that the Grande Cable Franchise had a specific provision on Page
10 in Section 4(B)(i) whereby Grande agreed that the City reserved the "excusive right to
unilaterally modify" several sections of the Grande Cable Franchise to ensure it was
consistent and competitively neutral with the Time Warner Renewal Cable Franchise,
including but not limited to, "(1) Section 1 - Definitions, including but not limited to the
definition of Gross Revenue; (2) Section 4 - Franchise Term and Reopener; ... (7) Section
14 - Compensation to the City; (8) Section 15 - Accounts, Records, Reports and
Investigations; and (9) Section 16 - Assignment of Franchise."
Further, Section 4(B)(iii) provided as follows: "The City may only so reopen
negotiations and amend this franchise pursuant to this Section 4(B) on one occasion," as
it was contemplated at that time that the Time Warner Renewal Cable Franchise would
be completed and that only one Grande Cable Franchise Amendment would be required.
E. The City Council hereby finds as follows: The Time Warner Cable Franchise is at this
time being amended in part but with the affirmation of the parties that future amendments
are to follow, and such current amendment is to require a five percent (5%) franchise fee;
and that the existing Grande Cable Franchise has a four percent (4%) gross revenue
franchise fee, and therefore that the Grande Cable Franchise should be modified
accordingly to a five percent (5%) franchise fee, so as to be competitively neutral.
F. Grande Communications, Inc. and the City of Round Rock hereby contractually agree
that the subject matter of this Grande Cable Franchise Amendment shall not be
considered to be the "one occasion" on which the "City may only so reopen negotiations
and amend this franchise pursuant to this Section 4(B)."
II.
AMENDMENT OF "FRANCHISE TERM AND REOPENER" SECTION
Ordinance No. G -01-11-20-12A1 shall be amended as follows: The existing Section
4(B)(iii) shall be deleted and replaced by the following:
(iii) Under no circumstances shall Grantee be required to accept any amendments to
this franchise which would require Grantee to change the network architecture,
technology or design, including bandwidth capacity as set forth herein, of
Grantee's cable/broadband system. The City may only so reopen negotiations
and amend this franchise pursuant to this Section 4(B) on one other separate and
additional occasion, separate from this amending ordinance, as to Section 1(29)
entitled "Definitions" dealing with the definition of Gross Revenue, and as to
Section 14(A) entitled "Compensation to the City - Franchise Fee" dealing with
the percentage of the franchise fee, and may only so reopen negotiations and
amend this franchise pursuant to the other items in this Section 4(B) on one other
separate and additional occasion, separate from this amending ordinance. Also,
under no circumstances shall the City's right to reopen Section 7 - Provision of
Access Channels and Access Support and Section 10 - Provision of Institutional
Network, of this franchise pursuant to Section 4(B)(i) be construed to be a
change in network architecture, technology or design.
2
AMENDMENT OF "COMPENSATION TO THE CITY - FRANCHISE FEE" SECTION
Ordinance No. G -01-11-20-12A1, Section 14(A) shall be amended as follows: in each
and every instance where words or numerals appear denoting "four percent (4%)," that
percentage amount shall be increased to five percent (5%).
IV.
EFFECTIVE DATE
This ordinance shall take effect on the same effective date as the Time Warner Cable
Franchise amendment, that being sixty—one (61) days after final adoption by the City Council,
with the five percent (5%) franchise fee accruing from that date forward, subject to written
acceptance of this amending ordinance by Grande Communications, Inc. within thirty (30) days
from the adoption hereof.
V.
AUTHORITY
On behalf of Grande Communications, Inc. the signer of this amending ordinance to the
referenced franchise agreement represents and warrants that he or she has full authority to
execute same on behalf of Grande Communications, Inc.
VI.
PASSAGE AND APPROVAL
A. All ordinances, parts of ordinances, or resolutions in conflict herewith are expressly
repealed.
B. The invalidity of any section or provision of this ordinance shall not invalidate other
sections or provisions thereof.
C. The City Council hereby finds and declares that written notice of the date, hour, place
and subject of the meeting at which this Ordinance was adopted was posted and that such
meeting was open to the public as required by law at all times during which this
Ordinance and the subject matter hereof were discussed, considered and formally acted
upon, all as required by the Open Meetings Act, Chapter 551, Texas Government Code,
as amended.
Alternative 1
By motion duly made, seconded and passed with an affirmative vote of all the Council members
present, the requirement for reading this ordinance on two separate days was dispensed with.
3
READ, PASSED, and ADOPTED on first reading this
2005.
day of
Alternative 2 I
READ and APPROVED on first reading this /L day of , 2005.
READ, APPROVED, and ADOPTED on second reading this day of (� , 2005.
eniamtvi
CHRISTINE R. MARTINEZ, City Secretary1-3
4
AXELL, Mayor
DATE: April 21, 2005
SUBJECT: City Council Meeting - April 28, 2005
ITEM: *9.B.1. Consider an ordinance authorizing the Mayor to execute an amended
cable franchise agreement with Grande Communications, Inc. (Second
Reading)
Department: Administration Department
Staff Person: Will Hampton, Communications Director
Justification:
This amendment increases the franchise fee to 5 percent from 4 percent for Grande
Communications.
Funding:
Cost: N/A
Source of funds: N/A
Outside Resources: N/A
Background Information:
The timing of the approval of this amendment must coincide with the amendment to the Time
Warner franchise to maintain competitive neutrality between the two.
Public Comment: N/A