Definitions

As used in this chapter, the term: (1) ‘‘Authorization’’ means the official act of a franchising authority to allow a public provider to deliver service. (2) ‘‘Cable service’’ means: (A) The one-way transmission to subscribers of (i) video programming or (ii) other programming service; and (B) Subscriber interaction, if any, which is required for the selection or use of such video programming or other programming service. (3) ‘‘Capital costs’’ means all costs of providing a service which are capitalized in accordance with generally accepted governmental accounting principles. 1378 36-90-2 (4) ‘‘Cross-subsidization’’ or ‘‘cross-subsidize’’ means the payment of any item of direct or indirect costs of providing a service which is not accounted for in the full cost accounting of providing the service. (5) ‘‘Direct costs’’ means those expenses of a public provider which are directly attributable to the provision of a service that would be eliminated if the provision of said service were discontinued. (6) ‘‘FCC’’ means the Federal Communications Commission. (7) ‘‘Franchising authority’’ means any governmental entity which is empowered by law to grant a franchise and which is also a public provider. (8) ‘‘Full-cost accounting’’ means the accounting for all costs incurred by a public provider in providing a service, including all direct and indirect costs, as required by this chapter. In preparation of such accounting, a public provider shall utilize cost accounting standards promulgated by the federal Costs Accounting Standards Board of the federal Office of Management and Budget so as to assure that all direct and indirect costs are included. (9) ‘‘Generally accepted governmental accounting principles’’ means the accounting standards promulgated from time to time by the Governmental Accounting Standards Board. (10) ‘‘Indirect costs’’ means any costs identified with two or more services or other public provider functions and which are not directly identified with a single service. Indirect costs may include, but are not limited to, administration, accounting, personnel, purchasing, legal, and other staff or departmental support. Indirect costs shall be allocated to two or more services in proportion to the relative burden each respective service places upon the cost category. (11) ‘‘Private provider’’ means any person, firm, partnership, corporation, or association offering service, other than a public provider. (12) ‘‘Public provider’’ means any county, municipal corporation, or other political subdivision of the state which provides service; any authority or instrumentality acting on behalf of or for the benefit of any county, municipal corporation, or other political subdivision of the state which provides service; and any authority or instrumentality created by the state which provides service. (13) ‘‘Service’’ means cable service provided by a private provider or a public provider. (14) ‘‘Subscriber’’ means any private person lawfully receiving any cable service provided by a private or public provider by means of or in connection with a cable system. 1379 36-90-3 History. — Code 1981, § 36-90-2, enacted by Ga. L. 1999, p. 1267, § 1; Ga. L. 2004, p. 990, § 2. 36-90-3. Notifications to private providers before authorizing public provider; feasibility analysis and specific findings required; components of business plan; public hearings; requirements of ordinance or resolution. (a) Before a franchising authority may begin the authorization process of permitting a public provider to deliver service, the franchising authority must notify each private provider serving the targeted market that the franchising authority intends to begin the process of authorizing a public provider to provide cable service. The notice must state that the private provider is not meeting the present and future needs of the community and shall set forth each such unmet need separately and fully in order that the private provider may reasonably ascertain the scope and nature of the issues identified by the franchising authority. The franchising authority must allow each private provider 30 days to present a plan to address the identified needs not being met, including a reasonable period of time to implement the plan. Neither the notification nor response to the notification provided for in this subsection shall affect the franchise agreement between a private provider and a franchising authority. (b) If the franchising authority does not accept the private provider’s plan to address the identified issues submitted as provided in subsection (a) of this Code section, the franchising authority shall then conduct an independent feasibility analysis and require the public provider to prepare a business plan to provide service. Such business plan shall set forth assumptions and specific findings as to: (1) The cable service market share to be obtained by the public provider over a four-year period; (2) The programming service offerings; (3) Reasonable projections, for a period of at least four years, of the revenue and the direct, indirect, and imputed operating costs of providing service; (4) The equipment needed to provide the service; (5) The source and adequacy of the total direct and indirect capital to construct and operate the proposed system; (6) The repayment of the debt service, including the length of payback of the principal debt; (7) A cost-benefit analysis that shows a range of assumptions relating to market penetration rates, subscription rates, operating costs, and capital outlay; 1380 36-90-3 (8) Assumptions as to programming costs; (9) Assumptions as to actual or potential competition from all other providers; (10) The allocation of costs between the public provider and other municipal operations; and (11) The ability to address the issues cited in the notice to the private providers specified in subsection (a) of this Code section. (c) In order for the business plan provided for in subsection (b) of this Code section to be adopted and the process to move forward, the business plan shall include, at a minimum, the following components: (1) The total homes passed, provided that such shall be certified by the appropriate official responsible for municipal tax or census; (2) Cable service basic penetration, estimated subscribers, and total homes passed, provided that such shall be reflective of the market analysis and not presume a penetration achieved by the fourth year of operation in excess of 40 percent without full independent verification; (3) The overall estimated revenue takeout per home, provided that the same shall not exceed by more than 5 percent the amount being achieved by the private provider as developed from such publicly available information as franchise fee reports; (4) The estimated miles of cable plant, provided that such shall be determined based on an actual survey conducted by public works employees and certified as to method and findings by a responsible supervisor; (5) The average construction cost per cable service subscriber or cable plant mile or both, provided that such shall be based on an estimate provided by an independent supplier; and (6) A definitive plan for the servicing of any capital utilized to fund the construction and operation of the cable system, including a reasonable payback period at an interest rate reflective of the public market and the inherent risks of the business. (d) Prior to granting the authorization to the public provider, the franchising authority shall conduct at least two public hearings held at least two weeks apart. The public provider shall publish its business plan in its entirety and provide a complete copy to each private provider at least 30 days before the first public hearing. Such notice shall state that the business plan prepared by the public provider is available for public inspection each business day prior to the authorization and shall state the location where such inspection may be made. Notice of the 1381 36-90-5 time, place, and date of each hearing shall be published in a newspaper of general circulation within the jurisdiction of the county or municipality once a week for the two weeks preceding the week in which the hearing is to be held. In addition, the private provider shall be given two weeks’ written notice of the proposed hearing. (e) Any authorization by the franchising authority shall be by passage of an ordinance or resolution and must: (1) Find that the public provider possesses satisfactory financial and technical capability to be a public provider; (2) Set forth the terms and conditions with respect to franchise terms and conditions, conditions of access to public property, and pole attachment; and (3) Adopt the business plan. History. — Code 1981, § 36-90-3, enacted by Ga. L. 1999, p. 1267, § 1; Ga. L. 2004, p. 990, § 3. 36-90-4. Accounting methods regarding the cost of providing service; cross-subsidization prohibited. On and after January 1, 2000, each public provider shall prepare and maintain records in accordance with generally accepted governmental accounting principles which record the full cost accounting of providing service. Such records shall show the amount and source of capital, including working capital, utilized in providing service. Nothing contained in this chapter shall preclude a public provider utilizing capital from any lawful source, including the public provider’s general funds, provided that the reasonable cost of such capital is accounted for as a cost of providing the service. No public provider shall cross-subsidize the costs of providing service. A public provider shall impute into its indirect costs of providing service an amount for franchise fees, regulatory fees, occupation taxes, pole attachment fees, and ad valorem property taxes, calculated in the same manner as such amounts are calculated for any private provider paying such costs to the public provider in the same service area. History. — Code 1981, § 36-90-4, enacted by Ga. L. 1999, p. 1267, § 1. 36-90-5. Franchise agreements.