ORDINANCE NO.          8058    

AN ORDINANCE AMENDING ORDINANCE NO. 7359 CONCERNING THE NON-EXCLUSIVE FRANCHISE TO WORLDNET L.L.C. TO CONSTRUCT, USE AND MAINTAIN TELECOMMUNICATIONS CABLES AND LINES IN THE PUBLIC RIGHT-OF-WAY OF THE CITY OF LAWRENCE, KANSAS FOR THE PURPOSE OF SUPPLYING TELECOMMUNICATIONS SERVICES TO THE CITY OF LAWRENCE, KANSAS AND ITS INHABITANTS PURSUANT TO K.S.A. 12-2001 ET SEQ.

BE IT ORDAINED BY THE GOVERNING BODY OF THE CITY OF LAWRENCE, KANSAS:

Section 1.  Section 6 (Franchise Fee) of Ordinance No. 7359 is hereby amended to read as follows:

Section 6.         Franchise Fee.  a)  In partial consideration for the grant of this franchise and the premises herein, the Company agrees to pay and the City of Lawrence, Kansas agrees to accept as adequate compensation and consideration for the franchise hereby granted in lieu of any occupation, license, or privilege tax or any lease or easement charge, a franchise fee as defined herein.  The Company shall pay to the City a sum equal to two percent (2%) four percent (4%) of gross revenue for local exchange telecommunications service, rendered wholly within the corporate limits of the City through June 30, 2007.  On and after July 1, 2007, the Company shall pay to the City a sum equal to five percent (5%) of gross revenue for local exchange telecommunications service rendered wholly within the corporate limits of the City.  For purposes of this Ordinance, gross revenue for local exchange telecommunications service shall mean those revenues less uncollectibles, derived from the following:

(1) Recurring local exchange service revenues for business and residence which include basic exchange service, Touch Tone, optional calling features and measured local calls;

(2) Recurring local exchange service revenues for public, semi-public and private coin telephones, less commission;

(3) Local directory assistance;

(4) Line status verification / busy interrupt;

(5) Local operator assistance;

(6) Nonrecurring local exchange service revenue which shall include customer service for installation of lines, reconnection of service and charge for duplicate telephone bills.

b)  Telephone Company and City agree that all other services, including but not limited to, extended area service, resale, unbundled loops, non-regulated services, carrier and end user access, long distance and all other services not wholly local in nature are excluded from “local exchange telecommunications services.”  Telephone Company and City agree that “gross revenue from local exchange telecommunications services” shall be reduced by bad debt expenses and uncollectibles and further agree that franchise fees collected and late charges shall not be included within gross revenues from “local exchange telecommunications services.”

c) If during the term of this ordinance Telephone Company offers additional services of a wholly local nature which if in existence at the effective date of this ordinance would have been included with the definition of “local exchange telecommunications services,” such services shall be included within “local exchange telecommunications services” from the date of the offering of such services in City for the remaining term of the ordinance.

d) The franchise fee shall be paid monthly, by electronic transfer to the City of Lawrence, Kansas, or other method approved by the City and Company, for the preceding monthly period.  The Company shall pay the applicable fee to the City within forty-five (45) days of the last day of the applicable month for which a fee payment is due and owing.  Payments received after the due date shall be subject to a ten percent (10%) late payment charge. 

e) The Telephone Company and the City agree that the City shall have the sole authority to modify the franchise fee established by this Ordinance pursuant to the following provisions:  During the second year or thereafter during the term of the franchise agreement, the City may adopt an ordinance increasing the franchise fee to a maximum of 3%; During the third year or thereafter during the term of the franchise agreement, the City may adopt an ordinance increasing the franchise fee to a maximum of 4%; During the fourth year or thereafter during the term of the franchise agreement, the City may adopt an ordinance increasing the franchise fee to a maximum of 5%.  Further provided that the City provides the Telephone Company with ninety (90) days notice prior to the effective date of any franchise fee modification; that such franchise fee modification and ordinance comply with all lawful requirements for notice to customers; and that the City agrees to indemnify and hold harmless the Telephone Company for any and all liability, costs, damages, and expenses, including attorney’s fees, resulting from claims, causes of actions and demands arising out of or related in any manner to the increases in compensation pursuant to this subsection. 

f) The parties agree that if federal law or state law is enacted setting forth a maximum allowable level of compensation for franchise rights governed by this ordinance, the ordinance shall be amended to reduce the level of compensation required by this ordinance.

g) The franchise fee shall be in lieu of all other license, charges, fees or impositions (other than the usual general or special ad valorem taxes) which might be imposed by the City for the privilege of operating a telephone system within the City.

Section 2.  Section 6 (Franchise Fee) of Ordinance No. 7359 is hereby repealed it being the intent to supersede the repealed provision.  It is not the intention of this ordinance to repeal or amend any other portion of the existing Ordinance No. 7359, and all remaining provisions shall remain in full force and effect.

Section 3.        This ordinance shall take effect and be in full force and effect following its adoption and publication as provided by law.

Passed by the governing body this  day of , 2006.

                                                                        Mike Amyx, Mayor

ATTEST:

Frank S. Reeb, City Clerk

Approved as to form and legality:

Toni Ramirez Wheeler, Interim Director of Legal Services

Publish one time and return one Proof of Publication to the City Clerk.