House Amendment 1598 PAG LIN 1 1 Amend Senate File 554, as amended, passed, and 1 2 reprinted by the Senate, as follows: 1 3 #1. Page 1, by inserting after line 29 the 1 4 following: 1 5 < . "Franchise fee" means the fee imposed under 1 6 section 477A.7.> 1 7 #2. Page 2, line 1, by inserting after the word 1 8 <jurisdiction.> the following: <Gross revenues are 1 9 limited to the following: 1 10 (1) Recurring charges for cable service or video 1 11 service. 1 12 (2) Event=based charges for cable service or video 1 13 service, including but not limited to pay=per=view and 1 14 video=on=demand charges. 1 15 (3) Rental of set=top boxes and other cable 1 16 service or video service equipment. 1 17 (4) Service charges related to the provision of 1 18 cable service or video service, including but not 1 19 limited to activation, installation, and repair 1 20 charges. 1 21 (5) Administrative charges related to the 1 22 provision of cable service or video service, including 1 23 but not limited to service order and service 1 24 termination charges. 1 25 (6) A pro rata portion of all revenue derived, 1 26 less refunds, rebates, or discounts, by a cable 1 27 service provider or a video service provider for 1 28 advertising over the cable service or video service 1 29 network to subscribers within the franchise area where 1 30 the numerator is the number of subscribers within the 1 31 franchise area, and the denominator is the total 1 32 number of subscribers reached by such advertising. 1 33 This subparagraph applies only to municipalities that 1 34 include this provision in their franchise agreements 1 35 as of January 1, 2007.> 1 36 #3. Page 2, lines 17 and 18, by striking the words 1 37 <revenue received in connection with advertising,>. 1 38 #4. Page 3, by inserting after line 25 the 1 39 following: 1 40 <(14) Late payment charges. 1 41 (15) Maintenance charges.> 1 42 #5. Page 3, line 28, by striking the word <July> 1 43 and inserting the following: <January>. 1 44 #6. Page 3, by inserting after line 28 the 1 45 following: 1 46 < . "Institutional network" means the system of 1 47 dedicated fibers, coaxial cables, or wires constructed 1 48 and maintained by an incumbent cable provider which is 1 49 reserved and dedicated by the municipality for 1 50 noncommercial purposes.> 2 1 #7. Page 3, by striking lines 33 through 35 and 2 2 inserting the following: <greater than five percent. 2 3 However, if the incumbent cable provider is a>. 2 4 #8. Page 5, line 27, by inserting after the word 2 5 <area> the following: <, and to the incumbent cable 2 6 provider,>. 2 7 #9. Page 5, lines 31 and 32, by striking the words 2 8 <offers or intends to> and inserting the following: 2 9 <will>. 2 10 #10. Page 5, line 33, by inserting after the word 2 11 <municipality> the following: <, and shall not 2 12 provide service without having provided such thirty 2 13 days' notice>. 2 14 #11. Page 6, by striking lines 6 through 18 and 2 15 inserting the following: 2 16 <6. If a competitive cable service provider or a 2 17 competitive video service provider receives a 2 18 certificate of franchise authority to operate within a 2 19 municipality, the incumbent cable provider may, at its 2 20 discretion, apply for a certificate of franchise 2 21 authority for that same municipality. Such 2 22 application shall be automatically granted on the same 2 23 day as a competitive cable service provider or 2 24 competitive video service provider files a thirty 2 25 days' notice of offering service as required pursuant 2 26 to subsection 4. The franchise agreement with the 2 27 municipality is terminated on the date the board 2 28 issues the certificate of franchise authority to an 2 29 incumbent cable provider. The terms and conditions of 2 30 the certificate of franchise authority shall be the 2 31 same as the terms and conditions of a competitive 2 32 cable service provider or a competitive video service 2 33 provider pursuant to this chapter and shall replace 2 34 the terms and conditions of the franchise agreement 2 35 previously granted by the municipality.> 2 36 #12. Page 6, line 34, by inserting after the words 2 37 <laws and> the following: <nondiscriminatory>. 2 38 #13. Page 8, by striking lines 3 through 11 and 2 39 inserting the following: 2 40 <4. A certificate of franchise authority issued by 2 41 the board is fully transferable to any successor of 2 42 the applicant to which the certificate was initially 2 43 issued. A notice of transfer shall be filed by the 2 44 holder of the certificate of franchise authority with 2 45 the board and the affected municipality and shall be 2 46 effective fourteen business days after submission. 2 47 The notice of transfer shall include the address of 2 48 the successor's principal place of business and the 2 49 names of the successor's principal executive officers. 2 50 The successor shall assume all regulatory rights and 3 1 responsibilities of the holder of the certificate. 3 2 Neither the board nor an affected municipality shall 3 3 have authority to review or require approval of such 3 4 transfer.> 3 5 #14. Page 10, line 15, by inserting after the word 3 6 <services.> the following: <At its election the 3 7 municipality may reasonably request any cable service 3 8 provider or video service provider to make any 3 9 necessary change to the form of any programming, 3 10 furnished for transmission, which shall be charged to 3 11 the municipality, not to exceed the provider's 3 12 incremental costs. The municipality shall have up to 3 13 twelve months to reimburse the cable service provider 3 14 or video service provider.> 3 15 #15. Page 11, by striking lines 20 through 26 and 3 16 inserting the following: 3 17 <b. All cable service providers and video service 3 18 providers shall pay a franchise fee at the same 3 19 percent of gross revenues as had been assessed on the 3 20 incumbent cable provider by the municipality as of 3 21 January 1, 2007, and such percentage shall continue to 3 22 apply for the period of the remaining term of the 3 23 existing franchise agreement with the municipality. 3 24 Upon expiration of the period of the remaining term of 3 25 the agreement with the incumbent cable service 3 26 provider, a municipality may request an increase in 3 27 the franchise fee up to five percent of gross 3 28 revenues.> 3 29 #16. Page 12, line 5, by striking the word <eight> 3 30 and inserting the following: <five>. 3 31 #17. Page 12, by striking lines 12 through 29. 3 32 #18. Page 12, line 35, by inserting after the word 3 33 <municipality> the following: <, even if the 3 34 incumbent cable provider elects to convert to a 3 35 certificate of franchise authority pursuant to section 3 36 477A.2>. 3 37 #19. Page 13, by striking lines 3 through 14 and 3 38 inserting the following: 3 39 <4. a. If an incumbent cable provider is required 3 40 by a franchise agreement as of January 1, 2007, to 3 41 provide institutional network capacity to a 3 42 municipality for use by the municipality for 3 43 noncommercial purposes, the incumbent cable provider 3 44 and any subsequent holder of a certificate of 3 45 franchise authority shall provide support only for the 3 46 existing institutional network on a pro rata basis per 3 47 customer. Any financial support provided for an 3 48 institutional network shall be limited to ongoing 3 49 maintenance and support of the existing institutional 3 50 network. This subsection shall be applicable only to 4 1 a cable service provider's or video service provider's 4 2 first certificate of franchise authority issued under 4 3 this chapter, and shall not apply to any subsequent 4 4 renewals. For the purposes of this subsection, 4 5 maintenance and support shall only include the 4 6 reasonable incremental cost of moves, changes, and 4 7 restoring connectivity of the fiber or coaxial cable 4 8 lines up to a demarcation point at the building. 4 9 b. For purposes of this subsection, the number of 4 10 customers of a cable service provider or video service 4 11 provider shall be determined based on the relative 4 12 number of subscribers in that municipality at the end 4 13 of the prior calendar year as reported to the 4 14 municipality by all incumbent cable providers and 4 15 holders of a certificate of franchise authority. Any 4 16 records showing the number of subscribers shall be 4 17 considered confidential records pursuant to section 4 18 22.7. The incumbent cable provider shall provide to 4 19 the municipality, on an annual basis, the maintenance 4 20 and support costs of the institutional network, 4 21 subject to an independent audit. A municipality 4 22 acting under this subsection shall notify and present 4 23 a bill to competitive cable service providers or 4 24 competitive video service providers for the amount of 4 25 such support on an annual basis, beginning one year 4 26 after issuance of the certificate of franchise 4 27 authority. The annual institutional network support 4 28 shall be due and paid by the providers to the 4 29 municipality in four quarterly payments, not later 4 30 than forty=five days after the close of each quarter. 4 31 The municipality shall reimburse the incumbent cable 4 32 provider for the amounts received from competitive 4 33 cable service providers or competitive video service 4 34 providers. 4 35 c. This subsection shall not apply if the 4 36 incumbent cable service provider is a municipal 4 37 utility providing telecommunications services under 4 38 section 388.10.> 4 39 #20. Page 13, by inserting before line 15 the 4 40 following: 4 41 <5. A franchise fee may be assessed or imposed by 4 42 a municipality without regard to the municipality's 4 43 cost of inspecting, supervising, or otherwise 4 44 regulating the franchise, and the fees collected may 4 45 be credited to the municipality's general fund and 4 46 used for municipal general fund purposes. 4 47 6. To the extent that any amount of franchise fees 4 48 assessed by and paid to a municipality prior to the 4 49 effective date of this Act, pursuant to a franchise 4 50 agreement between a municipality and any person to 5 1 erect, maintain, and operate plants and systems for 5 2 cable television, exceeds the municipality's 5 3 reasonable costs of inspecting, supervising, or 5 4 otherwise regulating the franchise, such amount is 5 5 deemed and declared to be authorized and legally 5 6 assessed by and paid to the municipality.> 5 7 #21. Page 14, line 24, by striking the words <four 5 8 thousand> and inserting the following: <two thousand 5 9 five hundred>. 5 10 #22. Page 15, by inserting after line 14 the 5 11 following: 5 12 <Sec. . FRANCHISES FOR PROVISION OF CABLE 5 13 SERVICE OR VIDEO SERVICE == SEVERABILITY. If any 5 14 provision of this Act, or its application thereof to 5 15 any person or circumstance is held invalid, the 5 16 invalidity shall not affect other provisions or 5 17 applications of this Act which can be given effect 5 18 without the invalid provision or application, and to 5 19 this end the provisions of this Act are severable as 5 20 provided in section 4.12.> 5 21 #23. By renumbering, redesignating, and correcting 5 22 internal references as necessary. 5 23 5 24 5 25 5 26 COMMITTEE ON COMMERCE 5 27 PETERSEN of Polk, CHAIRPERSON 5 28 SF 554.506 82 5 29 rn/je/9143 -1-