§ 109. Fees, payment of fees and penalties.

109.(a). Throughout the term of this franchise, Company shall pay to City a franchise fee of five (5) percent of Gross revenues as defined herein. Provided that, the City may at any time increase this fee to the maximum that may be charged consistent with state and federal law, should the federal law limit change or be eliminated. However, the City may not increase the franchise fee except after providing the Company 90 days advance written notice, and providing Company the opportunity to comment on the proposed change within that 90-day period. Nothing herein shall prohibit the City from decreasing the franchise fee, as determined in City's sole discretion.

109.(b). The following shall not be included in Gross revenues for purposes of calculating the franchise fee: reimbursements received by the Company from programmers for the costs actually expended by the Company in a temporary joint marketing campaign, including programming launch fees.

109.(c). Gross revenues shall be reduced by the amount of bad debt expense (using the direct write-off method). For purposes of this Section 109(c), the term "bad debt expense" refers to amounts lawfully billed to a customer and owed by the customer for Cable Service and accrued as revenues on the books of Company, but not collected after reasonable efforts have been made to collect the charges. Bad debt expense, by way of example and not limitation, does not include the amount of discounts, promotions, or credits provided a Subscriber that may reduce the amount a Subscriber owes to the Company. Provided, however that bad debt expense shall again be treated as revenue when recovered.

109.(d). The exclusion of the foregoing reimbursements and bad debt expense from the franchise fee calculation shall not be read to suggest that any other reimbursement, similar or dissimilar, should or should not be excluded from the calculation of Gross revenues.

109.(e). The franchise fee and any other cost or penalties assessed shall be payable, except as otherwise specified in this franchise, quarterly to the City office of financial services, and the Company shall file a complete and accurate verified statement of all Gross revenues within the City during the period for which said quarterly payment is made, and said payment for each quarter shall be made to the City not later than forty-five (45) days after the expiration of the quarter when due.

109.(f). In addition to its other rights to review and copy the Company's records under other provisions of this franchise or the St. Paul Legislative Code, the City shall have the right to inspect the Company's records to determine whether the Company has paid the franchise fee owed. The City may, but is not required to, audit such records and to recompute any amounts determined to be payable under this ordinance. The Company shall reimburse the City for all expenses incurred by the City in conducting the audit where such audit shows the Company's fee payment for any quarter reviewed is five (5) percent or more under the amount found by the City to be due and owing.

109.(g). In the event that any franchise payment or recomputed amount, cost or penalty is not made on or before the applicable dates heretofore specified, interest shall be charged daily from the date of such default or delay at the rate of interest which is the prime rate charged by the US Bank National Association (or a successor bank used by the City) for preferred customers as adjusted on the first day of each month for the month in which such default or delay first occurred.

109.(h). The acceptance by the City of any franchise fee payment shall not be construed as an accord that the amount paid is in fact the correct amount, nor shall such acceptance of such franchise fee payment be construed as a release of any claim the City may have for additional sums payable.

109.(i). The franchise fee payment is not a payment in lieu of any tax, fee or other assessment except as specifically provided in this franchise, or as required by applicable law. By way of example, and not limitation, permit fees and business franchise taxes are not waived and remain applicable.

(Ord 15-55, § 1, 11-12-15)