Cable t. V. Franchise

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The City Council of Bird Island ordains:
1. “Franchisor” or “City” is the City of Bird Island, Minnesota.
2. “Franchisee” is North American Communications Corporation, a wholly owned subsidiary of Hector Communications Corporation of Hector, Minnesota.

3. “FCC” is the Federal Communications Commission of the United States.

4. “Class IV Channel” means a signaling path provided by a cable communications system to transmit signals of any type from a subscriber terminal to another point in the cable communications system.
5. The words “shall” and “must” are always mandatory.
6. The word “may” allows discretion.
7. “Non-voice return communications” means the provision of appropriate system design techniques with the installation of cable and amplifiers suitable for the subsequent insertion of necessary non-voice communications electronic modules.
8. The words “may not” are unconditionally prohibited.
WHEREAS, the Franchisor has following reasonable notice conducted a full public hearing, affording all persons reasonable opportunity to be heard, which proceeding was concerned with the analysis and consideration of the technical ability, financial conditions, legal qualifications and general character of the Franchisee, and
WHEREAS, the said Franchisor after such consideration, analysis and deliberation, has approved and found sufficient the technical ability, financial condition, legal qualification, and character of said Franchisee, and
WHEREAS, the said Franchisor has at the said public hearing, also considered and analyzed the plans of the Franchisee for the construction and operation of the cable communications system and found the same to be adequate and feasible in the view of the needs and requirements of the entire area to be served by the said system, and
WHEREAS, it is understood and agreed by the Franchisor and Franchisee that this franchise is non-exclusive.
NOW, THEREFORE, the Franchisor does ordain that there is hereby created, granted, and established a full and complete franchise for a period of fifteen (15) years from and after the effective date of this Ordinance, a television signal service, and other communication services, to the residents of Bird Island, Minnesota, in, under, over and on the public ways of the City for the purpose of transmission and distribution of television, picture telephone, radio, related impulses, and other communication services, in accordance with the laws of the United States, the State of Minnesota, and the ordinances of the City of Bird Island, subject to the following terms and performance conditions:
A. The Franchisee shall have the right and privilege to construct, erect, operate and maintain, in, upon, along, across, above, over and under the streets, alleys, public ways and public places now laid out or dedicated and all extensions thereof, and additions thereto in Bird Island, Minnesota, poles, wires, cables, underground conduits, man holes, and other television conductors and fixtures necessary for the maintenance and operation in the City of a cable communications system.
B. The right to use and occupy said streets, alleys, public places and ways for the purpose herein set forth shall not be exclusive, and the City reserves the right to grant similar use of said streets, alleys, public ways and places to any person at any time during the period of this franchise.
C. The location of the transmission and distribution systems herein contemplated shall, upon request by the City, be first approved by the City, and, upon request, one complete set of plans shall be placed on file with the Clerk of the City and kept as current as the City shall deem appropriate.
2. RENEGOTIATION OF FRANCHISE TERMS. Any renewal of this franchise shall be for a period of not more than fifteen (15) years. Renegotiation of any or all of the terms of the franchise may occur at such times as may be mutually agreed upon by the Franchisor and Franchisee. Renegotiation between Franchisor and Franchisee shall occur not less that one (1) year prior to the end of the franchise term. The Franchisor may determine not to reissue the franchise to the Franchisee or may consider additional applicants for a franchise.
A. No signals of a Class IV cable communications channel shall be transmitted from a subscriber terminal for purposes of monitoring individual viewing patterns or practice without the express written permission of a subscriber. The request for such permission shall be contained in a separate document with a prominent statement that the subscriber is authorizing the permission with full knowledge of its provision. Such written permission shall be for a limited period of time not to exceed one (1) year, which shall be renewable at the option of the subscriber. No penalty shall be invoked for a subscriber’s failure to provide or renew such an authorization. The authorization shall be revocable at any time by the subscriber without penalty of any kind whatsoever. Such authorization is required for each type of classification of Class IV cable communications activity planned for the purpose.
B. No information or data obtained by monitoring transmission of signal from a subscriber terminal, including but not limited to lists of the names and addresses of such subscribers or any lists that identify the viewing habits of subscribers shall be sold or otherwise made available to any party other than to the Franchisee and its employees for internal business use, and also to the subscriber subject of that information, unless the Franchisee has received specific written authorization from the subscriber to make such data available.
C. Written permission from the subscriber shall not be required for the systems conducting system wide or individually addressed electronic sweeps for the purpose of verifying system integrity or monitoring for the purpose of billing. Confidentiality of such information shall be subject to the provision set forth in 4 MCAR 4.202 W. 1.
4. SUBSCRIBER CONTRACTS. Franchisee may use subscriber contracts in the form substantially as the forms attached to this Ordinance as Exhibit 2. Any change to the subscriber contract which affects the rights or responsibilities of the subscriber shall first be submitted for approval to the Franchisor. If, after 30 days of the submission of a proposed change in the form subscriber contract, the City does not object in writing to such proposed change, the Franchisee may use such proposed subscriber contract, or subscribers. If, within 30 days of such submission, the City does object to such proposed changes to the subscriber contract, in writing to the Franchisee, a hearing may be held on such proposed changes and the Franchisee may be given an opportunity to present its views to the City. Within 30 days of such hearing, the City shall either approve or disapprove such proposed changes. If the City disapproves, the changes shall not be implemented by Franchisee, but Franchisee may submit new proposed changes to the form subscriber contracts to the City pursuant to the above terms and conditions.
5. RATE STRUCTURE. Initial subscriber rates shall be set forth on the attached Exhibit “1”, which exhibit is hereby made as part of this Agreement.
6. CHANGE IN RATES OF PROGRAMMING. No increase in rates charged to subscribers shall be made by Franchisee except as authorized by the Franchisor after full, open and public proceeding upon prior notice and opportunity of all interested parties to be heard.

In addition, for the purpose of determining if the rates are reasonable, the books of the Franchisee shall be open to inspection by the Franchisor or its agents, at all reasonable times. If the Franchisee requests a change in rates, it shall present in detail in writing the statistical basis, in addition to the other requirements as set out in this Section, for the proposed rate change at least sixty (60) days prior to the proposed effective date of such rates.

Before any increased rates or prices to be charged by the Franchisee are approved by the City Council, the City Council shall hold a public hearing on the matter. A notice of such hearing shall be published at least once in the official newspaper not less than thirty (30) days prior to the date of the hearing. At the hearing, the Council may take such action as it deems necessary to obtain other available information and data before granting or denying the approval of the Franchisee’s request for a rate change.

The Franchisee shall also file with the City all proposed programming changes. If, after 30 days of such filing, the City does not object in writing to such proposed changes, the Franchisee may put into effect such changes. If, within 30 days of such filing, the City does object to such proposed changes in writing to Franchisee, a hearing shall be held on such proposed changes and the Franchisee shall be given an opportunity to present its views to the City. Within 30 days of such hearing, the City shall either approve or disapprove such proposed changes. If the City disapproves, such proposed changes shall not be put into effect. Provided, that if the programming changes are mandated by Federal or State law or a station being carried on the cable system discontinues operation, then the Franchisee may implement such change without City approval but shall give written notice of the change to the City as soon as possible.


A. The Franchisee shall provide a toll-free telephone number for subscriber complaints and shall maintain a repair service capable of responding to subscriber complaints or requests for service within twenty-four (24) hours after receipt of the complaint or request. Any complaints not resolved to the satisfaction of the complaining party shall be communicated to the Franchisor. A record of unresolved complaints may be retained by the Franchise and considered by the Franchisor in making any discretionary decisions relating to this franchise.

B. Whenever it is necessary to shut off or interrupt services for the purpose of making repairs, adjustments or installations, the Franchisee shall do so during period of minimum use by subscribers. Unless such interruption is unforeseen, the Franchisee shall give reasonable notice thereof to the subscribers affected. All costs incurred in making such repairs, adjustments or installations shall be borne by the Franchisee unless otherwise provided for in this Ordinance or it can be clearly determined that the repair or adjustment was made necessary by abuse or intentional misuse of the system by the subscriber.
8. CHANNEL CAPACITY. The Franchisee shall provide a cable communications system having a channel capacity of 54 forward and 4 reverse channels with initial activation of at least 35 channels.
A. The Franchisee shall provide to each of its subscribers who receive all, or any part of, the total services offered on the system, reception on at least one specially designated access channel. The specially designated access channel may be used by local educational authorities and local government on a first-come, first-served non-discriminatory basis.
B. During those hours when the channels are not in use by local educational authorities or local government, the Franchisee shall lease time to commercial or non-commercial users on a first-come, first-served non-discriminatory basis if the demand for such time arises.
C. The Franchisee may also use these specially designated access channels for local origination during those hours when the channel is not in use by local educational authorities, local government, or commercial and non-commercial users who have leased time on these specially designated access channels. The VHF spectrum (channels 2-13) must be used for the specially designed access channel required in 4 MCAR 4.202DD.
D. The Franchisee shall establish rules pertaining to the administration of the specially designated access channels.
E. If the Franchisee provides only alarm services or only data transmission services for computer-operated functions, then the Franchisee need not provide access channel reception to such alarm and data service subscribers.
10. PROGRAM EQUIPMENT. The Franchisee shall make readily available to the City for its use two (2) modulators and shall make readily available for public use, upon 24 hour notice, at least the minimal equipment necessary to perform good quality playback of pre-recorded programming, and to make it possible to record programs at remote locations with battery operated portable equipment. In addition, the Franchise shall make available for public use, upon 24 hours notice, a mixer and dubbing board, provided that the Franchisee need only make the mixer and dubbing board available and need not deliver it to the City. Use of the equipment described in this Section shall be at no charge to the City or the users.
11. TWO-WAY CAPABILITY. The Franchise shall provide a cable communications system having the technical capacity for non-voice return communications.
12. COMPLIANCE WITH STATE, FEDERAL AND LOCAL LAWS. This Agreement shall be subject to all presently applicable Federal, State and City ordinances and rules. The Franchisee and the franchising authority shall conform to all state laws and rules regarding cable communications not later than one (1) year after they become effective, unless otherwise stated and shall conform to all federal laws and regulations regarding cable as they become effective.
A. The system shall deliver to the subscribers terminal a signal that is capable of producing a black and white or colored picture without visual material degradation in quality within the limitations imposed by the technical State of the Art.
B. The system shall transmit or distribute signals without causing objectionable cross-modulation in the cables or interfering with other electrical or electronic networks or with the reception of other television or radio receivers in the area not connected to the network.
14. INDEMNIFICATION AND LIABILITY INSURANCE. The Franchisee shall, concurrently with the filing of an acceptance of award of any franchise granted under this ordinance, furnish to the Franchisor and file with the City Clerk and at all times during the existence of any franchise granted hereunder, maintain in full force and effect, at its own cost and expense, a corporate surety bond or liability insurance policy evidenced by a certificate of insurance in the amount of at least One Million Dollars ($1,000,000.00).

The Company shall save and keep harmless the City, the City Council an all City Employees and commissions, from any suit, judgment, execution, claim or demand whatsoever which may be asserted or recovered against it based upon or arising out of the construction, maintenance or operation of the system or any part thereof.

The insurance shall be obtained from a company acceptable to the City Council and such acceptance shall not be unreasonably withheld and a certificate of coverage shall be provided to the City. The policy shall state that the City shall be notified in writing by the insurer thirty (30) days in advance of any cancellation or termination of such policy. The City Council shall annually review the above insurance provisions and if it is determined that the insurance coverage in inadequate, additional insurance may be required by the City Council and shall be provided for by the Franchisee.

Nothing contained in the franchise shall relieve any person from liability arising out of the failure to exercise reasonable care to avoid injury to the Franchisee’s facilities while performing any work connected with grading, regarding, or changing the line of any street or public place or with the construction or reconstruction of any sewer or water system.

15. PROPERTY RELOCATION. Whenever it shall be reasonably necessary for the needs of the Franchisor, Franchisee shall at its own expense, upon notice from the Franchisor, relocate, replace, and change its property placed on City poles and property, provided that in cases of emergency as determined by the Franchisor, the Franchisor may relocate, replace, or change property placed on City poles and property by the Franchisee, transfer them to substituted poles or perform any other work in connection with the said property that may be reasonably required to further Franchisor needs, and the Franchisee shall on demand, reimburse the Franchisor for the expense thereby incurred.
16. ACCESS TO FINANCIAL RECORDS. The Franchisor shall have the authority to audit the Franchisee’s accounting and financial records upon reasonable notice. Upon request by the City, the Franchisee shall file with the Franchisor annual reports of gross subscriber revenues and such other information as the Franchisor may deem appropriate.
17. MUNICIPAL RIGHT TO PURCHASE. Upon expiration of the franchise term, revocation of the franchise, other termination of the franchise, or upon receipt of an application from the Franchisee for approval of any assignment or transfer of the franchise, the Franchisor shall have the non-exclusive right to purchase the system.
18. SALE OR TRANSFER. Sale or transfer of this franchise or sale or transfer of stock so as to create a new controlling interest is prohibited except with the approval of the Franchisor, which approval shall not be unreasonably withheld.
19. TERMINATION. The Franchisor may terminate and cancel the franchise and all rights and privileges of the Franchisee in the event that the Franchisee substantially violates any provision of the franchise ordinance or any rules, orders or determinations of the Franchisor or attempts to evade any of the provisions of the franchise ordinance or practices any fraud or deceit upon the Franchisor. Conditions or circumstances for the Franchisor’s termination of the franchise shall include but not necessarily be limited to the following:
A. If the Franchisee should default in the performance of any of its obligations under the franchise, and shall fail to act on the default within thirty (30) days after receiving written notice of default;
B. If a petition is filed by the Franchisee under any Bankruptcy Act, or other insolvency or creditor’s rights laws, state of federal, or the Franchisee is adjudged a bankrupt or insolvent under any insolvency or creditor’s rights law, state of federal.

The Franchisor shall provide the Franchisee with a written notice of the cause for termination and its intention to terminate the franchise and the cause for termination and its intention to terminated the franchise and shall allow the Franchisee a minimum of thirty (30) days subsequent to receipt of the notice in which to correct the violation. The Franchisee shall be provided with an opportunity to be heard at a public hearing before the governing body of the Franchisor prior to termination of the franchise.

20. PROCEDURE UPON TERMINATION. Upon termination or forfeiture of the franchise, Franchisee shall within twelve (12) months of such termination or forfeiture upon request of Franchisor, remove its cable, wires, and all other appliances relating to the cable communications system from the streets, alleys and other public places within the franchise area, and shall restore the same to their original condition or as reasonably as can be, and in the event or failure to do so, the following procedure shall be followed: The Franchisor may remove or have removed the cables, wires and all other appliances relating to the cable communications system, the cost of such removal to be charged to the Franchisee. Franchisee shall also pay enforcement of this provision.

Failure to enforce or insist upon compliance with any terms or conditions hereof shall not constitute a general waiver or relinquishment of any such terms or conditions.

21. PERFORMANCE BOND. At the time the franchise becomes effective and at all times thereafter until the Franchisee has liquidated all of its obligations with the Franchisor, the Franchisee shall furnish a performance bond, certificate of deposit or any other type of instrument approved by the Franchisor in the amount of $5000.00, conditioned upon the faithful performance by the Franchisee according to the terms of the franchise and upon the further condition that in the event the Franchisee shall fail to comply with any law, ordinance or regulation governing this franchise, there shall be recoverable jointly and severally from the Franchisee and surety of the bond, any damages or loss suffered by the Franchisor, including the full amount of any compensation, indemnification or cost of removal or abandonment of any property of the Franchisee plus a reasonable allowance for attorney’s fees and costs, up to the full amount of the bond, and further guaranteeing payment by Franchisee of claims, liens, and taxes due to the Franchisor which arise by reason of the construction, operation or maintenance of the system. The rights reserved by the Franchisor with respect to the bond are in addition to all other rights the Franchisor may have under the franchise of any other law. The Franchisor may, from year to year, in its sole discretion, reduce the amount of the performance bond or instrument.

Franchisee understands that should it fail to complete its proposed construction within any of the applicable times fixed in this franchise, due allowance, being made for contingencies provide for the franchise document, the Franchisee shall be required to pay to the City of Bird Island $100.00 for each day of such delay beyond the time stated for completion as liquidated damages that the City of Bird Island and the subscribers will suffer by the delay.

22. CONSTRUCTION SCHEDULE. All areas within the initial service area will be constructed within six (6) months of the receipt of all necessary operating authorizations. The construction schedule is as follows:
30-60 days from the filing date of FCC certification notice by the Franchisee: begin engineering design, apply for and execute pole line agreements, permits, easements, rights-of-way, etc.
60-90 days from the filing date of the FCC certification notice: complete engineering design and order materials.
90-180 days from the filing date of the FCC certification notice: complete construction of system, providing service to customers as each area of the initial service area is activated.
The construction schedule is guaranteed provided there are no delays due to the FCC, right-of-way permits, pole clearances, or an act of God.
23. AUTHORIZATION TO COMMENCE CONSTRUCTION. Permission by Franchisor for commencement of construction of the cable communications system authorized herein is granted herewith, subject to Franchisee giving Franchisor reasonable notice of the proposed construction thereof, so as to coordinate all work between Franchisor and Franchisee.
A. Franchisee shall not open or disturb the surface of any street, sidewalk, driveway or public place without first obtaining a permit from the proper authority for which permit the Franchisor may impose a reasonable fee to be paid by the Franchisee. The lines, cables, conduits and other property placed in the streets and public places pursuant to such permit shall be located in the streets or portions of the streets and public places as shall be determined by the proper authority. The Franchisee shall, upon completion of any work requiring the opening of any street or public place restore the same including the pavement and its foundations, to as good a condition as formerly, and in a manner and quality approved by the proper municipal authority, and shall exercise reasonable care to maintain the same thereafter in good condition. Such work shall be performed with the due diligence and if the Franchisee shall fail to perform the work promptly, to remove all dirt and rubbish and to put the street or public place back into good condition, the Franchisor shall have the right to put the street or public place back into good condition at the expense of the Franchisee and the Franchisee shall upon demand, pay to the Franchisor the cost of such work done or performed, together with an additional sum as liquidated damages to be determined by the Franchisor.
B. All wires, conduits, cable and other property and facilities of the Franchisee shall be so located, constructed, installed and maintained as not to endanger or unnecessarily interfere with the usual and customary trade, traffic and travel upon the streets and public places of the franchise area. The Franchisee shall keep and maintain all of its property in good condition, order and repair so that the same shall not menace or endanger the life or property of any person. The Franchisor shall have the right to inspect and examine at any reasonable time and upon reasonable notice the property owned or used, in part or in whole, by the Franchisee. The Franchisee shall keep accurate maps and records of all of its facilities and furnish copies of such maps and records as requested by the Franchisor.
C. All wires, cables, amplifiers and other property of the Franchisee shall be constructed and installed in an orderly and workmanlike manner. All cables are wires shall be installed, where possible, parallel with electric and telephone lines. Multiple cable configurations shall be arranged in parallel and bundled with dual respect for engineering consideration.
D. Franchisee shall at all times comply with all applicable codes. In any event, the system shall not endanger or interfere with the safety of persons or property in the franchise area or other areas where the Franchisee may have equipment located.
25. PUBLIC IMPROVEMENTS. Whenever the Franchisor shall undertake any public improvement which affects cable communications equipment, it shall, with due respect to reasonable working conditions direct the Franchisee to remove or relocate its wires, conduits, cables and other property located in said streets, right-of-way or public places. The Franchisor shall give the Franchisee reasonable notice of the undertaking of public improvements which affect the Franchisee’s cable communications equipment.
26. FRANCHISE ADMINISTRATION. The City Clerk shall be responsible for day-to-day administration of this franchise. The City Council may, by resolution, create a cable commission or cable advisory board and appoint members to this commission or board. The cable commission or advisory board shall have such duties and delegations as established by the City Council, and shall serve the City Council in an advisory capacity. Members of the cable commission or advisory board shall receive no compensation and shall serve at the will of the Council. Establishment of and delegation of duties to the cable commission or advisory board shall be by resolution of the City Council. The City Council shall retain ultimate authority for the administration of this franchise. There shall be established by the City a procedure for periodic appraisal and review of the cable communications system. Such review may be performed by the Council or on delegation from the Council to the cable commission or advisory board, if such is established. The cable commission or advisory board or the City Council, as the case may be, shall submit a written report following such periodic evaluation and recommend any changes that the board or council deems appropriate. A copy of such report shall be delivered to the Franchisee.
27. TECHNICAL STANDARDS. This franchise shall incorporate by reference as a minimum the technical standards promulgated by the Federal Communications Commission relating to cable communications systems contained in Subpart K of Part 76 of the Federal Communications Commission Rules and Regulations relating to Cable Communications Systems. The results of any tests required by the Federal Communications Commission shall be filed within ten (10) days of the conducting of such tests with the Franchisor.

In the event that the Franchisor or Franchisee receives complaints from subscribers indicating that there may be technical difficulties with the system, the Franchisor may schedule a public hearing to be held concerning such complaints and shall give to the Franchisee at least thirty (30) days written notice of the date of such hearing, which notice shall state the complaints that have been made. If, following the completion of the public hearing the Franchisor is satisfied that such complaints are valid and that any technical difficulties causing such complaints have not bee corrected, it may order special testing to be done to determine the source of the technical difficulties. The Franchisee shall be responsible for the costs of such special testing so ordered.

28. ABANDONMENT. The Franchisee may not abandon any portion of the cable communications service provided hereunder, without having given three (3) months prior written notice to the Franchisor. Further, Franchisee may not abandon any cable communications service or any portion thereof without compensating the Franchisor for damage resulting from the abandonment.
29. LINE EXTENSION POLICY. Following the initial construction of the cable system as provided in Section 22 of this franchise, future extension of the system shall be implemented whenever said extension shall be economically feasible. Generally, whenever there are forty (40) homes within a distance of one mile measured in ext4ension length of Franchisee’s cable required for extending service to such homes and located within the public way or easement (but not including length of necessary service drop to a subscriber’s home), the Franchisee, at its own cost, shall extend its distribution cable as is necessary to provide service to such homes. Any subscriber located in any such home shall be connected to cable at the standard installation charges. However, the obligation of the Franchisee to so extend its cable shall depend on such extension being economically feasible as of the date such extension is being considered.
30. FRANCHISE FEE. The Franchise shall pay a franchise fee equal to the greater of three percent (3%) of its gross annual basic subscriber revenues, or $500.00. Said fee shall be payable to Franchisor annually.
31. ORDINANCE AND PUBLICATION COST. The publication cost of this franchise ordinance and the cost, including attorney’s fees, of preparing this ordinance, shall be borne by the Franchisee and paid to the City within thirty (30) days after the City renders Franchisee a bill covering the same.
32. INCORPORATION OF APPLICATION. This franchise shall be subject to all of the terms and conditions contained in the Application for franchise, which terms and conditions shall be incorporated by reference in this franchise and the terms and conditions of the application shall be filed with the City Clerk and maintained as a part of the franchise as an exhibit.
33. RETURN LINES. Franchise agrees by acceptance of this Ordinance to provide a return line or return lines from locations to be determined by the City to the system’s starting point. The City shall notify the Franchisee in writing of the locations for the return lines prior to the completion of the Franchisee’s construction schedule as set out above in this Ordinance.
Passed by the Bird Island City Council this 8 day of November, 1993.

Mayor Paul Setzepfandt


Deb Lingl, City Clerk

The undersigned, North American Communications Corporation, herewith accepts the terms and conditions of Ordinance 173 relative to the conditions and operations of a communications system in the City of Bird Island.

Curtis A. Sampson


North American Communications Corp.

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