19567ORDINANCE NO. 19,567
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3 AN ORDINANCE TO AUTHORIZE THE MAYOR TO ENTER INTO AN AGREEMENT WITH
4 AT &T OF ARKANSAS FOR USE OF THE CITY RIGHTS -OF -WAY TO PROVIDE IP- ENABLED
5 VIDEO SERVICES, AND SIMILAR IP- ENABLED SERVICES, WITHIN THE CORPORATE LIMITS
6 OF THE CITY OF LITTLE ROCK, ARKANSAS; AND FOR OTHER PURPOSES.
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8 WHEREAS, AT &T of Arkansas has approached the City about its intent to offer IP- enabled
9 television, and similar alternative services ( "IP- enabled video services ") to customers within the
10 corporate limits of the City of Little Rock; and
11 WHEREAS, the agreement attached as Exhibit A to this ordinance sets forth the terms and
12 conditions of that agreement;
13 NOW, THEREFORE, BE IT ORDAINED BY THE BOARD OF DIRECTORS OF THE CITY OF LITTLE
14 ROCK, ARKANSAS:
15 Section 1. The Mayor is hereby authorized to execute an agreement, in a form substantially
16 the same as that attached as Exhibit A to this ordinance, which permits AT &T Arkansas, Inc., to
17 provide IP- enabled video services to the citizens located within the corporate limits of the City
18 of Little Rock, Arkansas.
19 Section 2. Absent a change in law as set forth in Section 2, the City shall not impose any fee
20 for services pursuant to the agreement attached as Exhibit A, provided the parties agree that
21 the City cannot authorize or restrict the manner in which AT &T Arkansas, Inc., accounts for its
22 legitimate business expenses in setting the pricing for its IP- enabled video services.
23 Section 3. Severabi/ity. In the event any title, section, paragraph, item, sentence, clause,
24 phrase, or word of this ordinance is declared or adjudged to be invalid or unconstitutional, such
25 declaration or adjudication shall not affect the remaining portions of the resolution which shall
26 remain in full force and effect as if the portion so declared or adjudged invalid or
27 unconstitutional was not originally a part of the ordinance.
28 Section 4. Repealer. All laws and parts of laws inconsistent with the provisions of this
29 resolution are hereby repealed to the extent of such inconsistency.
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Ordinance to authorize agreement for IP- enabled video service
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I PASSED: July 18, 2006
2 ATTEST:
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4 4,10, " C&/J`'
5 �a cy Wood, City Clerk
6 APPROVED AS TO LEGAL FORM:
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Thomas M. Carpenter, Cit Attorney
Ordinance to authorize agreement for IP- enabled video service
from AT &T of Arkansas
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APPROVED:
Jim q ley, Mayor
I EXHBIT A: AGREEMENT WITH AT &T of ARKANSAS
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3 AGREEMENT
4 THIS AGREEMENT ( "Agreement ") dated --- - - - - -- 2006 ( "Effective Date ") is made by and between
5 SOUTHWESTERN BELL TELEPHONE, L.P., a Texas limited partnership doing business as AT &T Arkansas
6 ( "AT &T Arkansas ") and the CITY OF LITTLE ROCK, ARKANSAS, a municipal corporation ( "City "). AT &T
7 Arkansas and City shall sometimes be referred to separately as a "Party," and collectively as the "Parties."
8 RECITALS
9 A. As a telecommunications provider, AT &T Arkansas has statewide authority under Ark. Code Ann. §
10 23 -17 -101 to construct, operate and maintain its telecommunications facilities in the public rights of way
11 ( "ROW ") throughout the state of Arkansas. Under Ark. Code Ann. §14- 200 -101, the City is permitted to
12 impose reasonable terms and conditions on AT &T Arkansas' use and occupation of the City's ROW and to
13 collect a reasonable franchise fee for such use and occupation of its ROW.
14 B. AT &T Arkansas is in the process of upgrading its existing telecommunications network to provide
15 an integrated Internet Protocol ("IP ") enabled broadband platform of voice, data and video services ("IP
16 Network "), the video component of which is a switched, two -way, point -to -point and interactive service
17 ( "IP- enabled Video Service "). The IP Network upgrade will involve the use of the City's ROW.
18 C. AT &T Arkansas believes that Ark. Code Ann. §23-17-101 covers the construction, operation and
19 maintenance of the IP Network, and that AT &T Arkansas is not required to obtain a separate franchise or
20 other authorization from the City to offer IP- enabled services including IP- enabled Video Services within
21 the City over the IP Network.
22 D. AT &T Arkansas further believes that the City's right to regulate the construction of the IP Network
23 in the City's ROW is limited to the right to impose reasonable conditions regarding the time, place, and
24 manner of AT &T Arkansas' use and occupation of the City's ROW.
25 E. City believes that the provision of IP- enabled Video Services by AT &T Arkansas is beyond the
26 scope of Ark. Code Ann. §23-17-101 and is subject to the City's franchising authority.
27 F. City also believes that the IP- enabled Video Services which AT &T intends to provide will be a
28 competitive video services option to the cable television service currently provided by Comcast, Inc., and,
29 the City further believes that the authority it has to set terms and conditions for the use of its ROW, while
30 subject to Section 621 of the Telecommunications Act of 1934, as amended, is also a property right that is
31 before and higher than any constitutional sanction under the Arkansas Constitution, and cannot simply be
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I taken away by federal statute, rule, or regulation because the 10th Amendment the U.S. Constitution
2 precludes the federal government from exercising such authority over purely local matters such as
3 ownership rights in property.
4 G. Both Parties agree that the deployment of the IP Network and the provision of IP- enabled Video
5 Services should not be delayed by litigation to establish the scope of Ark. Code Ann. §23-17-101 or the
6 application of the City's franchise ordinance to IP- enabled Video Services.
7 H. The City is willing and able to provide an appropriate franchise to AT &T Arkansas that would not
8 adversely impact the terms and conditions of the City's current franchise agreement with Comcast, Inc.
9 A &T Arkansas does not wish to accept this offer. City and AT &T Arkansas agree that litigation to resolve
10 differing interpretations of state and federal law would be complex and protracted, and that in order to
1 1 move forward with the introduction of this new technology as soon as possible without actions of the City
12 becoming a barrier to competition, or providing an unfair advantage to any party, it is in the best interests
13 of both Parties to put into place an agreement that preserves each other's positions and claims.
14 NOW, THEREFORE, IN CONSIDERATION OF AND RELIANCE UPON THE RESPECTIVE REPRESENTATIONS,
15 PROMISES, CONCESSIONS, TERMS AND CONDITIONS CONTAINED HEREIN, CITY AND AT &T ARKANSAS
16 AGREE AS FOLLOWS.
17 1. Term. The term of this Agreement shall commence on the Effective Date of this Agreement
18 through the end of 2009. The term may be extended upon mutual consent of the parties.
19 2. Change of Law. The parties agree to consult in the event that, after the Effective Date, any court,
20 agency, commission, legislative body, or other authority of competent jurisdiction issues a finding that
21 limits the validity or enforceability of this Agreement or principals herein, in whole or in part. Should the
22 finding be final, non - appealable and binding upon either City or AT &T, this Agreement shall be deemed
23 modified or limited to the extent necessary to address the subject of the finding unless either party within
24 thirty (30) days of receipt of the ruling, provides written notice to the other party of election to terminate,
25 in which case this Agreement shall terminate within six (6) months or such earlier period as the parties
26 mutually may agree. Where the effect of a finding is a modification, the parties shall enter into good faith
27 negotiations to modify this Agreement in the manner which best effectuates its overall purposes and the
28 intentions of the parties. Failure to reach a mutually satisfactory modification within ninety (90) days of
29 the commencement of such efforts shall entitle either party to terminate the Agreement on the provision
30 of thirty (30) days' written notice.
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I In addition, the Parties agree that if either Party believes that any state or federal legislation,
2 administrative ruling, or judicial ruling, provides the opportunity to negotiate a different agreement or
3 different terms of this agreement, then the Parties shall reopen negotiations as to the terms of this
4 agreement in accordance with such development.
5 3. Compensation to City. During the term of this Agreement, AT &T shall pay to the City a fee of 5%
6 of the gross revenues from subscription and usage fees collected from each subscriber to, or user of,
7 AT &T Arkansas' IP- enabled Video Services product delivered over the IP Network in the City's rights of
8 way. The fee does not apply to non -video revenues or the non -video revenues of bundled product
9 containing video and non -video offerings. All such fees will be forwarded to the City quarterly on the last
10 of each quarter after collection.
1 1 Payment shall be accompanied by a report, in such form and containing sufficient detail to determine
12 AT &T's compliance with this Section, not later than thirty (30) days after the last day of each March, June,
13 September and December throughout the term of this Agreement setting forth the Gross Revenue for the
14 quarter ending on said last day. The City shall have the right to audit any such payment for a period of
15 three years and no acceptance of any payment shall be deemed final until the period for audit shall have
16 expired.
17 4. Public. Educational and Governmental Programming.
18 (a) AT &T Arkansas shall provide some form of access for the City's noncommercial, public,
19 education and government ( "PEG ") programming through AT &T Arkansas' IP- enabled Video
20 Services.
21 (b) AT &T Arkansas shall not be responsible for content of PEG programming.
22 (c) As soon as practicable, AT &T shall provide written notice that it has the technical capability to
23 provide IP based access for the City PEG channels (in use on the Execution Date of this
24 Agreement) over the platform AT &T wishes to use with this Agreement. If technological
25 feasibility requires a change in the current City technology, City shall be required to support a
26 change in or addition to City technology in use for the PEG programming to make it
27 compatible with AT &T Arkansas' IP- enabled video technology and any other necessary
28 technology.
29 (d) AT &T Arkansas will provide City capacity on its platform to carry the same number of PEG
30 channels that City currently has activated as of the effective date of this Agreement PEG
31 content will be made available by the City placing its content on the public Internet. AT &T
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I Arkansas will carry this PEG content on its video platform using its standard Internet sourced
2 PEG solution. AT &T will provide City a one -time up front capital grant to cover the initial set
3 up costs incurred by the City to make this content available on the Internet.
4 (e) AT &T's obligation herein will begin when its IP Video subscribers within the municipal
5 boundaries of the City reach 1000 or 18 months after the effective date of this Agreement,
6 whichever comes first. Once access to the City's PEG programming has begun, AT &T
7 Arkansas shall pay City an additional $.10 per month for each subscriber or user of AT &T
8 Arkansas' IP- enabled Video Services, and the City shall limit the use of these funds to the
9 support, operation, construction, or maintenance of its governmental channel.
10 (f) PEG programming will be available via the Internet for AT &T Arkansas' IP Video subscribers to
11 view both on TV and computer. PEG programming will be available via the Internet from the
12 end user's computer for AT &T Homezone subscribers that also have High Speed Internet
13 Access. AT &T Arkansas will meet with the City to discuss the possible development of an
14 economically and technically feasible process for providing PEG content to AT &T HomeZone
15 subscribers' TV.
16 5. Emergency Override Message. As soon as it is technically feasible to do so, AT &T Arkansas shall
17 work with the City to identify an economically and technically feasible process for providing an appropriate
18 message through AT &T Arkansas' IP- enabled Video Services in the event of a public safety emergency
19 issued over the Emergency Alert System, which at a minimum will include the concurrent rebroadcast of
20 local broadcast channels. The City and AT &T shall negotiate in good faith procedures which shall govern
21 the City's activation of the emergency alert. The City may adopt rules and regulations governing the City's
22 use of the emergency alert system, provided however, if such rules and regulations would impose more
23 than a minimal cost to AT &T, the parties shall negotiate the manner by which AT &T may recoup such
24 costs. In the event of an emergency, however, the City may take such actions as it deems necessary to
25 protect the health, safety and welfare of the residents of the City of Little Rock.
26 6. Obligations of City. During the term of this Agreement, City shall not attempt to nor subject the
27 provision of AT &T Arkansas IP- enabled Video Services over the IP Network to regulation under any City
28 cable television franchise ordinance or similar ordinance. In addition:
29 (a) City agrees to subject the construction and installation of the IP Network to the same process
30 and review as it subjects the installation and construction of AT &T Arkansas' existing
31 telecommunications infrastructure.
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1 (b) City agrees not to unreasonably block, restrict, or limit the construction and installation of the
2 IP Network during the term of this Agreement.
3 (c) City agrees to process any and all applicable permits for the installation, construction,
4 maintenance, repair, removal and other activities associated with the IP Network in a timely
5 and prompt manner as it does with other permit applications received in the ordinary course
6 of business.
7 7. Service within the City. AT &T Arkansas intends to offer video programming service on a non -
8 discriminatory basis, and without regard to the income or minority status of any resident or group of
9 residents residing within the municipal boundaries of the City. AT &T Arkansas intends to make video
10 programming available, subject to technology or other economic feasibility, to residents within the city
11 boundaries, by use of IP Video or other alternative video programming technology and that such access
12 will be extended to all persons, requesting such programming service, provided that during this
13 Agreement the areas to be served may increase if AT &T Arkansas elects to do so and such election is
14 consistent with all other terms of this agreement.
15 8. Indemnification.
16 (a) AT &T Arkansas shall be responsible for any liability, including without limitation, arising out of or
17 in connection with the construction, operation, maintenance or removal of the IP Network. The
18 City, its officers, employees, agents, attorneys, consultants and independent contractors, shall
19 have no liability to AT &T Arkansas for any special, incidental, consequential, punitive or other
20 damages as a result of the exercise of its police powers or any right granted to the City under this
21 agreement.
22 (b) With respect to AT &T Arkansas' indemnity obligations set forth above, AT &T Arkansas shall
23 provide the defense of any claims brought against City by selecting counsel of AT &T Arkansas'
24 choice to defend the claim, subject to the consent of City, which shall not be unreasonably
25 withheld. Nothing herein shall be deemed to prevent City from cooperating with AT &T Arkansas
26 and participating in the defense of any litigation by its own counsel at its own cost and expense,
27 provided, however, that after consultation with City, AT &T Arkansas shall have the right to defend,
28 settle or compromise any claim or action arising hereunder, and AT &T Arkansas shall have the
29 authority to decide the appropriateness and the amount of any such settlement. In the event that
30 the terms of any such settlement do not include the release of City and City does not consent to
31 the terms of any such settlement or compromise, AT &T Arkansas shall not settle the claim or
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I action, but its obligation to indemnify City shall in no event exceed the amount of such
2 settlement.
3 (c) City shall hold AT &T Arkansas harmless and shall be responsible for damages, liability or claims
4 resulting from the negligence or willful misconduct of City if and only if Arkansas statutory
5 immunity for local governments set forth in Ark. Code Ann. §21- 9- 301(West 2004) as may be
6 amended, is held by state court of final resort not to be the law in Arkansas.
7 (d) City shall be responsible for its own acts of negligence or willful misconduct, or breaches of
8 obligation committed by City for which City is legally responsible, subject to any and all defenses
9 and limitations of liability provided by law including, but not limited to, Arkansas statutory
10 immunity for local governments set forth in Ark. Code Ann. §21- 9- 301(West 2004). AT &T
11 Arkansas shall not be required to indemnify City for acts of City which constitute willful
12 misconduct or negligence on the part of City, its officers, employees, agents, attorneys,
13 consultants, independent contractors or third parties.
14 9. Breach of Agreement. Should either party claim that a material breach of any part of this
15 Agreement has occurred, that party will provide prompt written notice to the other, specifying the nature
16 of the breach; and upon receipt the other party shall cure such breach within 60 days.
17 10. Dispute Resolution. Except as otherwise provided in this Agreement, the Parties shall make
18 diligent good faith efforts to resolve all issues and disputes that arise in the administration of this
19 Agreement through discussions between designated representatives of the Parties, and use of a mediator
20 when such discussions have failed.
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11. Notices. Any notice to be given under this Agreement shall be in writing and may be delivered to
either personally, by facsimile or by certified or registered mail with postage prepaid and return
receipt requested, addressed as follows:
If to City: City of Little Rock, Arkansas
OFFICE OF THE CITY MANAGER
500 West Markham, Second Floor
Little Rock, Arkansas 72201
Attn: Mr. Bruce T. Moore (or current City Manager)
If to AT &T Arkansas: AT &T Arkansas
33 Attn:
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2 12. Modification. This Agreement may be amended or modified only by a written instrument
3 executed by both Parties.
4 13. Assignment. AT &T Arkansas may not assign or transfer this Agreement or any interest therein
5 without the prior consent of City except to any affiliate of AT &T Arkansas.
6 14. Entire Agreement. This Agreement and the ordinance by which it is authorized, embodies the
7 entire agreement and understanding of City and AT &T Arkansas with respect to AT &T Arkansas' use of the
8 City ROW in connection with the offering and provision of IP- enabled services including IP- enabled Video
9 Services within the City using facilities constructed and placed within the City ROW. As such it merges and
10 supersedes all prior verbal agreements, understandings and representations by either party on the matters
11 set forth herein.
12 15. Waiver. Failure on the part of either Party to enforce any provision of this Agreement shall not be
13 construed as a waiver of the right to compel enforcement of such provision or any other provision.
14 16. Miscellaneous.
15 (a) AT &T Arkansas and City each hereby warrants that it has the requisite power and authority to
16 enter into this Agreement and to perform according to the terms hereof.
17 (b) The headings used in this Agreement are inserted for convenience or reference only and are
18 not intended to define, limit or affect the interpretation of any term or provision hereof. The
19 singular shall include the plural; the masculine gender shall include the feminine and neutral
20 gender.
21 (c ) AT &T Arkansas and City shall cooperate fully with one another in the execution of any and all
22 other documents and in the completion of any additional actions including, without limitation,
23 the processing of permits that may be necessary or appropriate to give full force and effect to
24 the terms and intent of this Agreement.
25 (d) Nothing contained in this Agreement is intended or shall be construed as creating or
26 conferring any rights, benefits or remedies upon, or creating any obligations of the Parties
27 hereto toward any person or entity not a party to this Agreement, unless otherwise expressly
28 set forth herein.
29 (e) Nothing contained in this Agreement is intended or shall be construed as amending,
30 modifying or otherwise affecting any other agreements, authorizations or memoranda which
31 City and AT &T Arkansas have now. Further, nothing contained in this Agreement is meant to
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1 change, limit, modify, restrict or limit any current rights or jurisdiction that either City or
2 other governmental entities currently have nor is this Agreement intended to change, limit,
3 modify, restrict or limit any rights AT &T Arkansas currently has under existing federal and
4 state law and under existing City ordinances and existing construction permits issued by City.
5 (f) While the Parties understand that AT &T desires for this Agreement to become more
6 permanent, and the City is willing to work to accomplish this end, absent the prior mutual
7 consent of the Parties by signing this Agreement, neither AT &T Arkansas nor the City are
8 conceding in any way that an agreement with this City is a legal prerequisite to the
9 upgrading of its network or is a waiver of any rights regarding the provision of the IP -based
10 services following the termination of this Agreement, and both parties retain all legal rights
1 1 with respect to any obligation thereafter.
12 (g) AT &T Arkansas will offer Video Programming Services and provide customer service
13 consistent with the requirements of 47 C.F.R. Section 76.309 (c).
14 17. Binding Effect. This Agreement shall be binding upon and for the benefit of each of the Parties
15 and their respective past and present principals, managers, City Council members, offices, directors,
16 shareholders, agents, employees, attorneys, successors and assigns and any parents, subsidiaries or
17 affiliated corporations or entities, as applicable.
18 18. Counterpart Execution. This Agreement may be signed in one or more counterparts, each of
19 which shall be deemed an original and all of which together shall constitute one and the same agreement.
20 Signature pages may be transmitted by facsimile and any signature transmitted by facsimile will be given
21 the same force and effect as an original signature.
22 IN WITNESS WHEREOF, the parties hereto, by their duly authorized representatives, have executed this
23 Agreement and made the same effective as of ----------- - - - - -- ( "Effective date ").
24 AT &T ARKANSAS CITY OF LITTLE ROCK, ARKANSAS
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26 By: -------------------------------- - - - - -- By: - -P.Jim 27 Name: Edward Drilling Nam Dailey
28 Title: President - AT &T Arkansas Title: Mayor
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