MACC/RCN Telecom Services, Inc. - Telecommunications per ORD. No. 00-31 {
METROPO[ITAN AREA
-MACC COMMUNICATIONS COMMISSION
REPRESENTING:BANKS,BEAVERTON,CORNELIUS, DURHAM, FOREST GROVE, GASTON, HILLSBORO, KING CITY, LAKE OSWEGO, MILWAUKIE,NORTH PLAINS, RIVERGROVE,TIGARD. TUALATIN AND WASHINGTON COUNTY
CAb[E TV FRANChiSE RECGU[ATION • TELECOMMUNICATIONS AdVICE ANd SUPPORT • PUbtic COMMUNICATIONS NETWORK (PCN)
April 2, 2001
TO: MACC JURISDICTION MAYORS, CITY & COUNTY
MANAGERS & ATTORNEYS
FROM: BRUCE CREST, ADMINISTRATOR
RE: RCN TO LEAVE PORTLAND METRO AREA
In a meeting on March 29, 2000, Scott Burnside, RCN Vice President for Legal/Government
Affairs, announced that RCN would be leaving the Portland-area market due to their inability to
secure needed financing as a result of the recent downturn in the economy. This means that RCN
will not be signing the acceptance of the MACC cable franchise, which nullifies the individual
franchises, granted RCN by MACC jurisdictions last fall. RCN will now concentrate on
completing systems franchised in other areas and has no plans to return to the Portland market.
The attached letter from RCN officially confirms these plans.
Since RCN also accepted telecommunications franchises in Lake Oswego and Hillsboro, RCN
will be making separate contacts to those cities about their plans to leave the area.
We are disappointed with RCN's decision, but it was not unexpected due to the dramatic changes
in the financial markets since last summer. Hopefully another competitive provider, Western
Integrated Networks(WIN), will have renewed interest in pursuing franchises in the area now
that RCN has stepped aside. (The MACC Board of Commissioners authorized MACC staff to
negotiate a franchise with WIN last June.) We will keep you informed on any developments with
WIN.
We will be sending out a formal letter to the MACC member jurisdictions as a follow-up to this
memorandum soon. In the meantime, please contact me if you have any questions.
Attachment: RCN Letter
C. MACC Commissioners
1815 NW 169th Piace,Suite 6020 9 Beaverton,Oregon 97006-4886 Phone(503)645-7365 o FAX(503)645-0999 * Web site:www.maccor.org
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David A.Hankin
Vice President
Regulatory&Government
1400 Fashion Island Blvd.,Suite 100
San Mateo CA 94404
(650)212-8010
Fax(650)212-8009
lnnw
March 30, 2001 -,
Bruce Crest
Administrator
Metropolitan Area Communications Commission
1815 NW 169`h Place, Suite 6020
Beaverton, OR 97006-4886
Dear Mr. Crest:
This is in reference to your December 4, 2000 letter regarding RCN's acceptance of the franchise
agreement for the Metropolitan Area Communications Commission (MACC)Franchises.
Please be advised that RCN will not be accepting the terms, provisions and conditions of the Cable
Broadband Access and Telecommunications Services Franchise Agreement granted by the members of
the MACC as we no longer wish to provide services in the MACC area.
We appreciate the courtesy, consideration and diligence that you, your staff, and the members of
MACC have extended to RCN.
Sincerely,
f�Q%�
Dav ankin
cc: Scott Burnside
Jim Petro
February 21, 2001 CITY OF TIGARD
David Hankin OREGON
Vice President, Regulatory & Government Affairs
RCN Telecom Services, Inc.
1400 Fashion Island Blvd., Suite 100
San Mateo, California 94404
Dear Mr. Hankin,
On November 14, 2000, the Tigard City Council adopted ordinance # 00-31, granting
RCN Telecom Services Inc. a franchise to conduct a telecommunications business
within the City of Tigard. Section 14 of the Franchise Agreement (incorporated within
Ordinance # 00-31 as Exhibit A) provides,
"The Grantee shall, within thirty (30) days of the effective date of this ordinance,
file with the Recorder of the City its written acceptance of all of the terms and
conditions of the ordinance and if not so accepted by the Grantee, this ordinance
shall be void."
We did not receive your written acceptance of the ordinance by the deadline of
December 14, 2000, nor have we received anything from you to date. Therefore, by the
terms of Ordinance 00-31, Tigard's grant of a telecommunications franchise to RCN
Telecom Services is null and void.
Should RCN decide in the future that it would like to do business within the City of
Tigard, you will need to reapply for a telecommunications franchise. Please be aware,
however, that in December 2000, the City adopted Chapter 5.14 of the Tigard Municipal
Code governing the granting and management of telecommunications franchises. Any
new grant of franchise authority will be governed by this code section. You can find this
code provision on our web site, located at www.ci.tigard.or.us.
On October 24, 2000, the City of Tigard also granted RCN Telecom Services of Oregon
Inc., a cable franchise by ordinance #00-30. 1 understand that you have not yet
accepted this franchise either. I would appreciate receiving a report on the status of this
grant of a franchise.
At the time RCN applied for a telecommunications franchise from the City of Tigard,
your representatives indicated that you planned to build new lines and to purchase
some existing lines. Because you do not have a franchise with the City of Tigard, if you
13125 SW Hall Blvd., Tigard, OR 97223 (503) 639-4171 TDD (503) 684-2772
have purchased any lines within the city of Tigard, please be advised that those lines
may be located in our rights-of-way illegally. If you have, in fact, purchased lines within
the City of Tigard, you have several options:
1. Perfect your Cable Communications franchise by notifying MACC of your
acceptance of this franchise.
2. Apply for a new telecommunications franchise from the City of Tigard.
3. Request approval from the City of Tigard City Engineer to abandon these lines in
place. The City Engineer may grant approval, may require RCN to remove them, or
may cause them to be removed at RCN's expense.
4. Remove your facilities.
If you have any questions about any of these matters, please let me know.
l
rely
Prosser
Finance Director
Cc: Tigard City Council
Bill Monahan, City Manager
Gus Duenas, City Engineer
John Hagman, Senior Engineering Technician
Sarah Hackett, Senior Franchise Analyst, MACC
CITY OF TIGARD
OREGON
November 17, 2000
Jeff Condit
Miller Nash Wiener Hager& Carlsen LLP
3500 US Bancorp Tower
111 SW Fifth Ave.
Portland, Oregon 97204
Dear Jeff,
I have enclosed two copies of the City of Tigard ordinance #00-31, granting a franchise
for telecommunication services RCN Corporation. Please have your client sign both
sets of documents where flagged and return one executed set to me along with the
Certificate of Insurance as required by Section 6 of the Agreement. Your client may
keep the other set for their records. Once your client has returned these documents, I
will send a copy to the City Engineer who will then be able to coordinate with your
client's construction staff.
Thank you for your assistance though this process. Please let me know if we can be of
any other assistance.
Sincerely,
Craig Prosser
Finance Director
13125 SW Hall Blvd., Tigard, OR 97223 (503) 639-4171 TDD (503) 684-2772
NOV 17 ZOOa
CITY OF TIGARD, OREGON
ORDINANCE NO. 00- 31
AN ORDINANCE GRANTING TO RCN TELECOM SERVICES INC. A FRANCHISE TO
CONDUCT A TELECOMMUNICATIONS BUSINESS IN THE CITY OF TIGARD, OREGON,
INCLUDING THE RIGHT TO PLACE POLES,WIRES,AND OTHER APPLIANCES FOR
TELECOMMUNICATION PURPOSES IN THE PUBLIC RIGHTS-OF-WAY;AUTHORIZING
THE MAYOR TO SIGN THIS AGREEMENT;AND DECLARING AN EMERGENCY.
WHEREAS,The fourteen-year franchise for the communication facilities and services provided by
RCN Telecom Services Inc.,described in the title of this ordinance,is now before the City Council
for approval. The Council believes that the franchise should be approved under the terms and
conditions set forth in Exhibit A, attached hereto, and by this reference made a part hereof.
THE CITY OF TIGARD ORDAINS AS FOLLOWS:
SECTION 1. The terms and conditions of the attached franchise agreement,Exhibit A, are hereby
approved and adopted as part of this ordinance as if specifically set forth.
SECTION 2. The Mayor is authorized and directed to sign the attached agreement on behalf of
the Council.
SECTION 3. The City Council determines that the fee imposed by this franchise is not a tax
subject to the property tax limitations of Article XI, Section 11 (b)of the Oregon
Constitution.
SECTION 4. This franchise is the second half of a franchise that allows RCN Telecom Services
Inc. to provide"bundled"cable,broadband, and telecommunications services over a
single line. The first half of the franchise was approved by ordinance#00-30,which
took effect on October 24,2000. This ordinance needs to take effect immediately to
coordinate with ordinance#00-30. Therefore,the City Council declares an
emergency and this ordinance takes effect upon passage.
Certified tc be a True Copy of
Original on file a+ acted C4� WnII
By: I
ORDINANCE No. 00-'3 ) City Recorder-City of Tig d
Page 1 Date:— 1 - 12-02
PASSED: By U()0AWIDIKyote of all Council members present after being read by number
and title only,this IL �- day of 0Dvfrq 2000.
Cat erine Wheatley, City Recorde
APPROVED: This L day of�Vpw��0�.2000.
� '.AW44(�
effi Mayor
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A proved asto form: s Gri
ity Attorney
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Date
ORDINANCE No. 00J I
Page 2 —
EXHIBIT "A"
A franchise agreement between the City of Tigard and RCN Telecom Services Inc.
SECTION 1. Subject to the other terms and conditions set forth in this document there is hereby
granted by the City of Tigard to RCN Telecom Services Inc., (herein referred to as
"Grantee"); its successors and assigns; subject to the development ordinances
and regulations of the City, the right and privilege to conduct a telecommunications
business within said City, or such other public property as may come within the
jurisdiction of the City during the term of this agreement for the purpose of
furnishing telecommunications services as defined in State and Federal Law. This
grant includes the right to erect, construct, place, replace, reconstruct, lay,
maintain, and operate poles, wires, switching equipment, amplifying equipment,
fixtures, facilities, appliances, structures and other devices including, but not limited
to, electronic, optical and mechanical devices customarily associated with
Grantee's function, and purpose of serving as a telecommunications utility.
This franchise is granted solely for the privilege of providing telecommunications
services as defined by State and Federal Law. This franchise does not include the
right to conduct the business of providing a "cable system" as defined in applicable
law. The Grantee and the City acknowledge that Grantee holds a separate
franchise (approved by ordinance#00-30) to provide cable and broadband
services within the City of Tigard.
SECTION 2. It shall be lawful for Grantee to make all needful and necessary excavations in any
of said streets, alleys, avenues, thoroughfares and public highways.
SECTION 3. The Grantee shall file with the City Engineer or designee maps and materials
showing all proposed underground construction work to include the installation of
additional facilities or relocation or extension of existing facilities within any street,
alley, road or other public way or place within the corporate limits of the City. The
City will review the materials submitted and notify the Grantee of any City
requirements. For repair work or other work not considered underground
construction as stated above, the Grantee shall, if possible, notify the City of the
location and general description of the work before beginning work.
All work shall be done in a reasonably safe manner taking into account City
standard traffic control procedures and in accordance with requirements of
applicable federal laws, state laws, or City ordinances. In emergencies, such
filings shall be submitted within thirty (30) days of completion of emergency
construction work.
ORDINANCE No. 00-31
Exhibit A, Page 1
SECTION 4. When any excavation shall be made pursuant to the provisions of this ordinance,
the Grantee shall restore the portion of the street, alley, road, or public way or
place to the same condition to which it was prior to the excavation. All such work
shall be done in strict compliance with the rules, regulations, ordinances or orders
which may be adopted from time to time during the continuance of this franchise
by the City Council or City Engineer or as may be otherwise provided by law. The
City shall have the right to fix a reasonable time within which such repairs and
restoration shall be completed and upon failure of such repairs and restoration
being made by Grantee, City shall cause such repairs to be made at the expense
of Grantee.
SECTION 5. The Grantee hereby agrees and covenants to indemnify, save harmless and
defend the City and its officers, agents and employees from any and all damages,
costs and expenses or claims of any kind whatsoever, or nature, arising from any
injury to persons or property by reason of the negligent act or omission of the
Grantee, its agents or employees in exercising the rights and privileges granted
hereunder and by this franchise.
SECTION 6. The Grantee shall provide and keep in force public liability insurance, with a
thirty-day cancellation clause, with a combined single limit of one million dollars,
relating to a single occurrence, which shall be evidenced by a certificate of
insurance filed with the City Recorder. The City shall be named as an additional
insured on the policy. The insurance shall indemnify and save the City harmless
against liability or damage which may arise or occur from any claim resulting from
the franchisee's operation under this chapter. In addition, the policy shall provide
for the defense of the City for any such claims.
Since Grantee will provide cable services pursuant to a Cable and Broadband
Access Franchise approved by the City (ordinance#00-30) over the same facilities
as it provides or will provide telecommunications services pursuant to this
franchise, Grantee may rely on the insurance certificates and surety bonds posted
pursuant to the Cable franchise.
SECTION 7. The City, by its properly constituted authorities, shall have the right to cause the
Grantee to move the location of any pole, underground conduit or equipment
belonging to Grantee whenever the relocation thereof shall be for public necessity,
and the expense thereof shall be paid by the Grantee. Such charges shall comply
with state statutes and administrative rules. Whenever it shall be necessary for
public necessity to remove any pole, underground conduit or equipment belonging
to Grantee or on which any wire or circuit of the Grantee shall be stretched or
fastened, the Grantee, shall, upon written notice from the City, or its properly
constituted authorities, meet with the City Engineer and agree in writing to a plan
and date certain to remove such poles, underground conduit, equipment, wire or
circuit, at Grantee's expense, and if the Grantee fails, neglects or refuses to do so,
the City, by its properly constituted authorities, may remove the same at the
expense of the Grantee. The costs associated with the removal, relocation or
ORDINANCE No. 00-31
Exhibit A, Page 2
extension of Grantee's facilities at the request of a private developer or
development shall be borne by such private developer or development.
SECTION 8. At such time that Grantee intends to discontinue using or to remove (including
actions pursuant to a City termination order) any telecommunications network
facility or facilities within the City, Grantee shall submit a specific plan for such
discontinuance or removal to the City Engineer and shall gain the City Engineer's
approval. The City Engineer may allow Grantee to abandon in place any facility or
facilities, may require the Grantee to remove or modify the facility or facilities within
the public rights-of-way or other public place or property, may cause the facility or
facilities to be removed at the Grantee's expense, or may take any combination of
these actions. Grantee shall complete such removal or modifications in
accordance with a schedule set by the City Engineer. Until such time that
Grantee's property is completely removed and all restorations to the public rights-
of-way or other public places or property have been completed, Grantee shall be
responsible for all necessary repairs, relocations, and maintenance of the facility or
facilities in the same manner and degree as if the facility or facilities were in active
use, and the Grantee shall retain all liability for such facility or facilities.
SECTION 9. All notices and approvals required under this Agreement shall be in writing. The
Grantee shall provide the City with the name, position and phone number of
Grantee staff that can be contacted for administration of this Agreement and for
contact with construction-related questions and comments.
Such notices and approval shall be directed to the City as follows:
City Engineer, City of Tigard
13125 SW Hall Blvd., Tigard, Oregon 97223
(503) 639-4171
SECTION 10. Upon request of the City, the Grantee shall provide available plans and locate any
underground conduit or equipment belonging to Grantee, as required for the
preparation of construction drawings.
SECTION 11. Whenever it becomes necessary to temporarily rearrange, remove, lower or raise
the wires, cables or other plant of Grantee for the passage of buildings, machinery
or other objects, Grantee shall temporarily rearrange, remove, lower or raise, its
wires, cables or other plant as the necessities of the case require; provided,
however, that the person or persons desiring to move any such buildings,
machinery or other objects, shall pay the entire actual cost to Grantee of changing,
altering, moving, removing or replacing its wires, cables or other plan so as to
permit such passage, and shall deposit in advance with Grantee a sum equal to
such cost as estimated by Grantee and shall pay all damages and claims of any
ORDINANCE No. 00-31
Exhibit A, Page 3
kind whatsoever, direct or consequential, caused directly or indirectly by changing,
altering, moving, removing or replacing of said wires, cables or other plant, except
as may be occasioned through the sole negligence of Grantee, Grantee shall be
given not less than ninety-six (96) hours written notice by the party desiring to
move such building or other objects. Said notice shall detail the route of
movement of such building or other objects over and along the streets, alleys,
avenues, thoroughfares and public highways and shall bear the approval of the
City. Such moving shall be with as much haste as possible and shall not be
unnecessarily delayed or cause Grantee unnecessary expense or waste of time.
SECTION 12. In consideration of the rights and privileges hereby granted, Grantee agrees to pay
to the City the greater of$7,500 per year or five percent (5%) of the gross
revenues derived from exchange access services, as defined in ORS 401.710, and
lease revenues to the extent that lease revenues are separate from and in addition
to revenues derived from exchange access services within the city limits less net
uncollectibles. Any portion of such revenue that is subject to the franchise fee
pursuant to the Cable television and broadband Access Franchise approved by
ordinance#00-30 shall be excluded from the computation of the franchise fee
payable under this separate grant of franchise for telecommunications services.
Such payments shall be made to the City every six months for the life of this
agreement on or before March 15 for the six month period ended December 31,
and September 15 for the six month period ended June 30. Grantee may make
such payments quarterly if Grantee so chooses.
Such franchise payment will be accepted by the City from the Grantee also in
payment of any license, privilege or occupation tax charged for regulatory or
revenue purposes. The franchise payment is not accepted in satisfaction of
payments due to City for the failure of Grantee to perform any of Grantee's
obligations pursuant to this franchise agreement including but not limited to
Grantees' obligations to bear the cost of repairs under Section 4 and the cost of
relocation under Section 7.
The City shall have the right to change the percentage of gross revenues set forth
above at any time during the life of this agreement provided it has made such
notice in writing at least 180 days prior to the effective date of any change.
The City shall have the right to conduct, or cause to be conducted, an audit of
franchise payments as defined herein. The City shall conduct the audit at its own
expense. Any difference of payment due either the City or Grantee through error
or otherwise as agreed upon by both the City and Grantee, shall be payable within
sixty (60) days after discovery of such error.
SECTION 13. The rights, privileges and franchise hereby granted shall continue to be in full force
for a period of fourteen (14)years from the date this ordinance becomes effective.
This ordinance shall be subject to any and all State or Federal laws and
regulations. It is understood and agreed that either party may request termination
or renegotiation of the terms of this agreement after 60 days notice in writing.
ORDINANCE No. 00-31
Exhibit A, Page 4
Upon such request, the other party agrees to negotiate in good faith for a period of
not less than 60 days, or such longer period as mutually agreed to by both parties.
If the parties fail to reach agreement on the requested termination or renegotiation
of terms, either party may avail itself of any legal remedies available to it.
SECTION 14. The Grantee shall, within thirty (30) days of the effective date of this ordinance, file
with the Recorder of the City its written acceptance of all the terms and conditions
of the ordinance and if not so accepted by the Grantee, this ordinance shall be
void.
DATED this 14th day of November, 2000.
CITY OF TIGARD
OREGON, a Municipal Corporation
i
By:
Mayor Ja es i h
ATTEST:
Catherine Wheatley
City Recorder
ORDINANCE No. 00-31
Exhibit A, Page 5
ACCEPTANCE OF FRANCHISE
WHEREAS, the CITY OF TIGARD, OREGON, under date of November 14, 2000 passed
ORDINANCE NO. 00-31, entitled as follows, to wit:
AN ORDINANCE GRANTING TO RCN TELECOM SERVICES INC. A FRANCHISE TO CONDUCT A
TELECOMMUNICATIONS BUSINESS IN THE CITY OF TIGARD, OREGON, INCLUDING THE RIGHT
TO PLACE POLES, WIRES, AND OTHER APPLIANCES FOR TELECOMMUNICATION PURPOSES IN
THE PUBLIC RIGHTS-OF-WAY; AUTHORIZING THE MAYOR TO SIGN THIS AGREEMENT; AND
DECLARING AN EMERGENCY.
NOW, THEREFORE, the undersigned, RCN Telecom Services Inc., the Grantee named in said
Ordinance, does for itself and its successors and assigns accept the terms, conditions and
provisions of Ordinance No. 00-31 and agrees to be bound thereby and comply therewith.
IN WITNESS WHEREOF, RCN Telecom Services Inc. has caused this instrument to be
executed by its officers as below subscribed this day of 12000.
By
Received by the City of Tigard
this day of , 2000.
ORDINANCE No. 00-31
Exhibit A, Page 6