Required Payments; Insurance and Indemnification.

D.C. Code div. V, tit. 34, ch. 12, subch. II, pt. F

in effect

D.C. Code § 34-1256.01 Franchise fee.

34-1256.01. Franchise fee. (a) A cable operator shall pay to the District a franchise fee of at least 5% of its annual gross revenues. The amount of the franchise fee shall be set forth in the franchise agreement. (b) The franchise fee shall be paid quarterly. (c) A cable operator shall file with the Office within 30 days after the end of each of the cable operator’s fiscal quarter, a financial statement clearly showing the gross revenues received by the cable operator during the preceding quarter. Payment of the quarterly portion of the franchise agreement fee shall be payable by certified check made to the D.C. Treasurer at the time the statement is filed. A cable operator shall also file, within 120 days after the end of the cable operator’s fiscal year, an annual report, prepared by a certified public accountant, showing the yearly total gross revenues. (d) The District may audit and recalculate any amounts determined to be payable under this chapter or the franchise agreement. Any additional amount due the District based on the audit shall be paid within 30 days after the Office sends to the cable operator a written notice setting forth the amount due. The notice shall include a copy of the audit report. The cost of the audit shall be borne by the cable operator if it is determined that the cable operator’s payment to the District for the preceding year is increased by more than 4%. (e) If the cable operator does not pay the recomputed amount within the 30-day period established by subsection (c) of this section, the cable operator shall be charged from the due date at the prevailing prime rate of interest. (f) The franchise fee shall not be deemed a tax or payment in lieu of taxes or fees of general applicability imposed by the District. No cable operator may designate the franchise fee as a tax in any communication to a subscriber or any third party. (g) If a franchise is terminated or revoked prior to its expiration date and the District invokes its right to purchase the cable operator’s cable system, the cable operator shall file with the Office, within not less than 30 days following the date that ownership and control pass to the District or its assignee, a financial statement clearly showing the gross revenues received by the cable operator since the end of the previous fiscal quarter. The cable operator shall pay the franchise fee due at the time the statement is filed. (Aug. 21, 1982, D.C. Law 4-142, § 601; as added Oct. 9, 2002, D.C. Law 14-193, § 2(b), 49 DCR 7334.)

D.C. Code § 34-1256.02 Security fund.

34-1256.02. Security fund. (a) Within 30 days after the approval of a franchise, a cable operator shall deposit with a bank located in the District, in an interest bearing escrow account established in the name of the District, a sum to be determined by the Office or set forth in a franchise agreement, as a security fund for the cable operator’s faithful performance of all the provisions of the franchise agreement; its compliance with all orders, permits, and directions of any District agency having jurisdiction over the cable operator’s acts or defaults under the franchise agreement; payment of any claims and liens due to the District by reason of the construction, operation, or maintenance of the cable system. (b) Of the security fund, no less than 20% shall be in cash, with the balance in the form of an irrevocable, unconditional letter of credit or other instrument in a form acceptable to the Director of the Mayor’s Office of Legal Counsel. The letter of credit or other instrument shall in no event require the consent of the cable operator prior to the collection by the District of any amount covered by such letter of credit or other instrument. The cable operator shall be entitled to interest on the cash portion of the security fund at a rate equal to whatever rate the District is actually earning on the cash. (c) The security fund, including any interest, shall become the property of the District to the extent necessary to cure outstanding violations, including outstanding liquidated damages that may be provided for in the franchise agreement, in the event that the franchise is terminated or revoked. (d) The bond shall require 30 calendar days written notice of any cancellation to both the Office and the cable operator. (e) Any failure by a cable operator to make deposits into or maintain the security fund as provided in this section shall be a material breach of the franchise and shall be grounds for the termination or revocation of the franchise. The procedures to follow in the event of a material breach may be set forth in the franchise agreement. (Aug. 21, 1982, D.C. Law 4-142, § 602; as added Oct. 9, 2002, D.C. Law 14-193, § 2(b), 49 DCR 7334; Oct. 22, 2015, D.C. Law 21-36, § 2072(g), 62 DCR 10905.)

D.C. Code § 34-1256.03 Indemnification of the District.

34-1256.03. Indemnification of the District. (a) A cable operator shall, at its sole cost and expense, indemnify and hold harmless the District, its officers, elected officials, agents, contractors, and employees against all claims, suits, causes of action, proceedings, judgments for damage arising out of the cable system under the franchise. (b) Failure to comply with subsection (a) of this section, or with the indemnification provisions in the franchise agreement, shall constitute a material breach of the franchise. The procedures to follow in the event of a material breach may be set forth in the franchise agreement. (Aug. 21, 1982, D.C. Law 4-142, § 603; as added Oct. 9, 2002, D.C. Law 14-193, § 2(b), 49 DCR 7334.)

D.C. Code § 34-1256.04 Insurance.

34-1256.04. Insurance. (a) At all times during the term of a franchise, including the time for removal of facilities, the cable operator shall hold a valid liability insurance policy and shall pay all premiums for the policy in a timely manner. The policy shall insure the District, its officers, boards, commissions, elected officials, agents, contractors, and employees against liabilities. The policy shall be issued by a company carrying a rating by Best of not less than “A” and the company shall be authorized by the District’s Superintendent of Insurance to do business in the District. (b) The amount of the liability insurance policy, and the terms of the policy, shall be established in the franchise agreement. (c) The form of the liability insurance policy shall be acceptable to the Director of the Mayor’s Office of Legal Counsel. (d) The policy shall require 30 calendar days written notice of any cancellation to both the Office and the cable operator. If the Office or the cable operator receives a cancellation notice, the cable operator shall obtain a new bond, meeting the requirements of this section, within 30 days after receipt of the notice by the Office or the cable operator. (e) The cable operator shall file with the Office written evidence of payment of premiums and executed duplicate copies of the liability insurance policy. (f) Failure to comply with the provisions of this section, or with the liability insurance provisions of the franchise agreement, shall constitute a material violation of a franchise. (Aug. 21, 1982, D.C. Law 4-142, § 604; as added Oct. 9, 2002, D.C. Law 14-193, § 2(b), 49 DCR 7334; Oct. 22, 2015, D.C. Law 21-36, § 2072(h), 62 DCR 10905.)

D.C. Code § 34-1256.05 Performance bond.

34-1256.05. Performance bond. (a) At all times during the term of a franchise, including the time for removal of facilities or management, the cable operator shall obtain and hold a performance bond running to the District with good and sufficient surety approved by the Office, in an amount to be determined by the Office or set forth in a franchise agreement, to ensure that the operation of the cable system continues uninterrupted in the event of a default by the cable operator. (b) The cable operator shall make all payments associated with the bond in a timely manner. (c) The cable operator shall file with the Office written evidence of payment of premiums and executed duplicate copies of the bond documents. (d) The bond shall be with a surety company authorized by the District’s Superintendent of Insurance to transact business in the District. (e) The bond shall require 60 calendar days written notice of any cancellation to both the Office and the cable operator. If the Office or the cable operator receives a cancellation notice, the cable operator shall obtain a new bond, meeting the requirements of this section, within 60 days after receipt of the notice by the Office or the cable operator. (f) Failure to comply with the provisions of this section, or with the performance bond provisions of the franchise agreement, shall constitute a material violation of a franchise. (Aug. 21, 1982, D.C. Law 4-142, § 605; as added Oct. 9, 2002, D.C. Law 14-193, § 2(b), 49 DCR 7334.)

Source: Council of the District of Columbia (code.dccouncil.gov)URL: https://code.dccouncil.gov/us/dc/council/code/titles/34/chapters/12/subchapters/II/parts/FFetched: 10/21/2026