Franchisee shall comply with the provisions of § 58.1-645
et seq. of the Code of Virginia, pertaining to the Virginia communications
sales and use tax, as amended from time to time, and, with the exception
of required compliance with the Virginia communications sales and
use tax, the provisions of this article shall not have any effect,
for so long as the communications sales and use tax or a successor
state or local tax that constitutes a franchise fee for purposes of
47 U.S.C. § 542, as amended, is imposed on the sale of cable
services by the franchisee to subscribers in the County.
In the event that the communications sales and use tax is repealed and no successor state or local tax is enacted that would constitute a franchise fee for purposes of 47 U.S.C. § 542, as amended, franchisee shall pay to the County a franchise fee of 5% of annual gross revenue, beginning on the effective date of the repeal of such tax (the "repeal date"). Beginning on the repeal date, the terms of §§ 28-32 through 28-35 of this chapter shall take effect. In accordance with Title VI of the Communications Act, the twelve-month period applicable under the franchise for the computation of the franchise fee shall be a calendar year. Such payments shall be made no later than 30 days following the end of each calendar quarter. Should franchisee submit an incorrect amount, franchisee shall be allowed to add or subtract that amount in a subsequent quarter, but no later than 90 days following the close of the calendar year for which such amounts were applicable; such correction shall be documented in the supporting information required under § 28-33.
Each franchise fee payment shall be accompanied by a brief report prepared by a representative of franchisee showing the basis for the computation, and a breakdown by major revenue categories (such as basic service, premium service, etc.). The County shall have the right to reasonably request further supporting information for each franchise fee payment, subject to the proprietary information provision of § 28-43.
The period of limitation for recovery of any franchise fee payable
hereunder shall be five years from the date on which payment by franchisee
is due.
This § 28-35 shall apply only if state or federal law does not otherwise address the computation of franchise fees or gross revenues in connection with the provision of cable service as part of a bundle or package with any non-cable service. If the franchisee bundles cable service with non-cable service, the franchisee agrees that it will not intentionally or unlawfully allocate such revenue for the purpose of evading the franchise fee payments under this chapter. In the event that the franchisee or any affiliate shall bundle, tie, or combine cable services (which are subject to the franchise fee) with non-cable services (which are not subject to the franchise fee), so that subscribers pay a single fee for more than one class of service or receive a discount on cable services, a pro rata share of the revenue received for the bundled, tied, or combined services shall, to the extent reasonable, be allocated to gross revenues for purposes of computing the franchise fee. To the extent there are published charges and it is reasonable, the pro rata share shall be computed on the basis of the published charge for each of the bundled, tied, or combined services, when purchased separately. However, the parties agree that tariffed telecommunications services that cannot be discounted under state or federal law or regulations are excluded from the bundled allocation obligations in this section.
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State Law reference — Similar provisions,
Code of Virginia § 15.2-2108.22.
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