Loading...
O-92-2594 - 9/24/1992ORDINANCE NO. 59 �T AN ORDINANCE APPROVING AND GRANTING CONSENT TO THE TRANSFER OF THE ASSETS OF SOUTHWEST CABLEVISION, LTD. TO TCI CABLEVISION OF TEXAS, INC., INCLUDING ASSIGNMENT OF THE INTEREST OF SOUTHWEST CABLEVISION, LTD. IN THE CABLE TELEVISION FRANCHISE ORIGINALLY GRANTED TO STOKES CABLE CO., INC. BY ORDINANCE NO. 501, PASSED AND ADOPTED BY THE CITY COUNCIL OF THE CITY OF ROUND ROCK, TEXAS, ON JULY 14, 1977, AS AMENDED; AND OTHER PROVISIONS RELATING TO THE CABLE TELEVISION FRANCHISE WHEREAS, by Ordinance No. 501 passed and adopted on July 14, 1977, the City of Round Rock (the "City") granted to Stokes Cable Co., Inc. ("Stokes"), its successors and assigns, a franchise or permit to build, construct, operate and maintain a cable television system in the streets, alleys and public places of the City of Round Rock (the "Cable Television Franchise"); and WHEREAS, the Cable Television Franchise was amended by Ordinance No. 532 adopted March 30, 1978, which ordinance evidences the consent of the City to the transfer of all of the issued and outstanding capital stock of Stokes to Daniels Cablevision, Inc.; and WHEREAS, the capital stock of Stokes was thereafter transferred to Bill Daniels as permitted by Section 14 of the Cable Television Franchise; and WHEREAS, on March 30, 1978, Ordinance No. 533 was adopted to replace the cable television system construction schedule in the Cable Television Franchise; and WHEREAS, the Cable Television Franchise was amended again by Ordinance No. 2208 adopted November 26, 1985, which ordinance evidences approval of the City Council to the transfer by Stokes of all of its assets, including the Cable Television Franchise, to Southwest Cablevision, Ltd. ("Southwest"), permitted the mortgage or encumbrance of the assets of Southwest as collateral for a loan, and extended the term of the Cable Television Franchise; and WHEREAS, Southwest requests that the City consent to the transfer of the assets of Southwest to TCI Cablevision of Texas, Inc., a Texas corporation ("TCIC-TX"), and to permit TCIC-TX to mortgage or encumber the assets of TCIC-TX as collateral for a loan; and WHEREAS, the City Council desires to extend the term of the franchise an additional five (5) years, amend the definitions of "Gross subscriber revenues" and "Regular subscriber revenues" contained in Sections 3(F) and 3(G), respectively, of the Cable Television Franchise, and amend Section 15 - Franchise Fee of the Cable Television Franchise; and WHEREAS, the City Council has investigated the background of TCIC-TX and finds TCIC-TX a suitable transferee; NOW THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF ROUND ROCK, TEXAS: Section 1. That the City Council hereby approves and consents to the transfer of all of the assets of Southwest to TCIC-TX, including transfer of the Cable Television Franchise. Section 2. The City confirms that (a) the Cable Television Franchise was properly granted; (b) the Cable Television Franchise is currently in full force and effect; (c) the Cable Television Franchise supersedes all other agreements between the parties; (d) the Cable Television Franchise represents the entire understanding of the parties and Southwest has made no commitments and owes no obligation to the City other than those specifically stated in the Cable Television Franchise; (e) Southwest is materially in compliance with the provisions of the Cable Television Franchise; and (f) there exists no known fact nor circumstance which constitutes or which, with the passage of time or the giving of notice or both, would constitute a default or breach under the Cable Television Franchise, or would allow the City to cancel or terminate the rights thereunder except upon the expiration of the full term thereof. Section 3. The City approves the transfer, mortgage, pledge, or other encumbrance of the Cable Television Franchise or assets of TCIC-TX as collateral for a loan. Section 4. The term of the franchise provided for in Section 11 of the Cable Television Franchise, as amended by Ordinance No. 2208, shall be extended for an additional five (5) years, so that said franchise term shall now expire on July 14, 2002. Section 5. The definition of "Gross subscriber revenues" contained in Section 3(F) of the Cable Television Franchise shall be amended to read in its entirety as follows: "Gross subscriber revenues" shall include any and all compensation or receipts derived by Grantee from subscribers within the City from recurring monthly service charges in connection with (i) the transmission of audio and video cable service to subscribers including the retransmission of broadcast signals, programming supplied on a per channel charge basis and music services, (ii) additional outlets, (iii) program guides, and (iv) converter rental, but shall not include revenue from other "ancillary" or "auxiliary" services, which include, but are not limited to, advertising, leased channels, programming supplied on a per program basis, installation fees, late charges, and commissions derived from home shopping channels, and shall not include any refunds or credits made to subscribers or any sales tax imposed on the services furnished by Grantee." Section 6. The definition of "Regular subscriber services" contained in Section 3(G) of the Cable Television Franchise shall be amended to read in its entirety as follows: "Regular subscriber services" shall include the transmission of audio and video cable service to -2- subscribers including the retransmission of broadcast signals, programming supplied on a per channel charge basis, and music services, but shall not include other "ancillary" or "auxiliary" services, which include, but are not limited to, advertising, leased channels, programming supplied on a per program basis, installation fees, late charges, and commissions derived from home shopping channels." Section 7. Section 15 of the Cable Television Franchise shall be amended to read in its entirety as follows: "In consideration of the terms of this franchise, Grantee agrees to pay the City a sum of money equal to four percent (4%) of Grantee's gross subscriber revenues per calendar quarter derived from regular subscriber services in the City as set out in Section 3(F). Such quarterly payments shall be made within forty-five (45) days after the end of each calendar quarter. All other license fees or taxes levied upon Grantee by the City shall be credited against the payments required herein." Section 8. This Ordinance shall not become effective until TCIC-TX certifies in writing to the City the date of the consummation of the purchase of the cable television system serving the City from Southwest and the assumption by TCIC-TX of the obligations of Southwest under the Cable Television Franchise, subject to applicable federal, state, and local laws. READ and APPROVED on first reading this the 1992. / day o EAD, 4PPROVED, and ADOPTED on second reading this the T -qday of 1992. ATTEST: NE LAND, City Secretary -3- MIKE ROBINSON, MAYOR City of Round Rock, Texas DATE: September 22, 1992 SUBJECT: City Council Meeting, September 24, 1992 ITEM: 8.J. Consider an ordinance approving and granting consent to the transfer of the cable company's assets and increasing the franchise fees paid to the City. (Second Reading) STAFF RESOURCE PERSON: David Kautz STAFF RECOMMENDATION: The purpose of this item is as follows: a) Approve the transfer of all assets of Southwest Cablevision, Ltd. to TCI Cablevision of Texas, Inc. b) Extend the franchise agreement with the City five years. c) Increase the franchise fee from 2% of basic service revenue to 4% of gross revenue net of certain non-recurring charges (pay per view, advertising sales, connection fees, etc..) The franchise fee is intended to reimburse the City for use of City rights of way and streets. The increased franchise fee would bring the City in line with surrounding cities as indicated on the attached comparison. ECONOMIC IMPACT: Revenue to the City would increase by $75,000 annually. The increased fee would likely be passed on to the customer by the cable company.