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                                                     APPENDIX B - FRANCHISES




NOTE:  The franchise ordinances included herein are for information only.  Each of them contains the substance as adopted by the governing body but enacting clauses, repealers and signatures have been omitted.  Complete copies of each ordinance as adopted is on file in the office of the city clerk.  Date of adoption of each franchise ordinance is shown in parentheses at the end of the text.



                                                           ORDINANCE NO. 672




                                                           Article I  C Definitions


For the purpose of the grant of this franchise, the following terms shall have the meanings as described herein:

(a)    City shall mean the City of Hugoton, Kansas, and shall include when appropriate the context of the territorial boundaries of the City of Hugoton, Kansas, as they now or shall hereinafter exist.

(b)    Council shall mean the present governing body of the City of Hugoton, or any successor to the legislative powers of the present city council.

(c)     Franchise shall mean the permission, license, franchise or authority given hereunder to conduct and operate a cable television system in the city.

(d)    Grantee shall mean Pioneer Telephone Association, Inc., doing business as Pioneer Communications, or its subsidiary, successors, transferees or assigns of the franchise granted herein.

(e)    Street shall mean the surface of and the space below any public street, road, highway, freeway, lane, path, alley, court, sidewalk, parkway, drive or other easement now or hereafter held by the city for the purpose of public travel and shall include such other easements or rights-of-way as shall be now held or hereafter held by the city which shall be within their proper use and meaning entitling the city and its grantee to the use thereof for the purpose of installing or transmitting cable television transmission over wires, cables, conductors, ducts, conduits, vaults, manholes, amplifiers, appliances, attachments, and other property as may be ordinarily necessary and pertinent to cable television systems.

(f)     Property of Grantee shall mean all property owned and installed or used by the grantee in the conduct of its cable television business in the city and under the authority of the franchise granted herein.

(g)    Cable Television System shall mean any system which operates for hire the service of receiving and amplifying programs broadcast by one or more television and/or radio stations and any other programs originated by a cable television company or by any other party and distributing such programs by wire, cable, microwave, coaxial cable, or other means, whether such means are owned or leased, to persons who subscribe to such service.

(h)    Subscriber shall mean any person or entity receiving for any purpose the cable television service of the grantee herein.

(i)      Person shall mean any individual or association of individuals, or any firm, corporation or other business entity.

(j)      Facilities of Grantee or Cable Television Facilities shall mean property of the grantee.


                                                    Article II C Grant of Franchise


Section 1.  General Grant. The city hereby grants to the grantee a non- exclusive right and privilege to construct a cable television system and operate and maintain it within the city and in so doing to use the streets of the city by installing, constructing, repairing, replacing, reconstructing, maintaining, and retaining in, on, over, under any such street, wires, cables, conductors, ducts, conduits, vaults, manholes, amplifiers, appliances, attachments and other property as may be necessary and pertinent to a cable television system within the city.


Section 2.  Financial Responsibility. Grantee will provide the city annually with a total disclosure of its financial capabilities by delivering copies of a current balance sheet and income statement.


Section 3.  Non-Exclusivity. The authority hereby granted to install and operate a cable television system in the city and to use and to occupy the streets therefore is not and shall not be deemed to be an exclusive right of permission. The city expressly reserves the right to grant similar non-exclusive franchises to other person, firms or corporations to operate cable television systems and to use the streets of the city therefore within the same or other areas of the city at any time or under any period of time.


Section 4.  Notice Concerning Complaints. Notice of the procedures for reporting and resolving complaints will be given to each subscriber at the time of the initial subscription to the cable system.


Section 5.  Modification of Franchise Standards. Any modification of the provisions of the federal franchise standards resulting from an amendment of the standards by the Federal Communications Commission must be incorporated into this franchise within one year of the adoption of the modification, or at the time of franchise renewal, whichever occurs first.


                                                               Article III  C Term


The franchise herein granted shall be for a term of 10 years unless the same shall sooner expire by reason of other provisions.

The term of this franchise shall commence on the first day of the first month following the date the grantee hereunder accepts and agrees to abide with the terms and conditions of this franchise by filing a written acceptance thereof with the city clerk of the city, which acceptance shall be filed, if it is to be valid, within 60 days from the effective date of the ordinance granting the franchise. If such acceptance shall not be filed within the time aforesaid, then the ordinance granting this franchise shall be deemed void and of no further force and effect and the offer of franchise contained in the ordinance will stand revoked.


                                                           Article IV C Forfeiture


In addition to all other rights and powers reserved or pertaining to the city, the city reserves as an additional and as a separate and distinct remedy the right to revoke this franchise and all rights and privileges of the grantee hereunder in any of the following events or for any of the following reasons:

(1)    Grantee fails after 30 days prior written notice to comply with any of the provisions of the ordinance granting this franchise, or has, by act or omission, violated any term or condition thereof;

(2)    Any provision of such ordinance shall be finally adjudged by a court of law as invalid or unenforceable and the city council further finds that such provision constitutes at that time a consideration material to the continuance of the franchise granted herein;

(3)    The grantee becomes insolvent, unable or unwilling to pay its debts or is adjudged a bankrupt;

(4)    All or part of the grantee=s facilities should be sold under an instrument to secure a debt and are not redeemed by the grantee within 60 days from such sale;

(5)    The grantee attempts to or does practice any fraud or deceit in its conduct or relations with the city or subscribers, under this franchise; or

(6)    The city condemns all of the property of the grantee within the city by lawful exercise of eminent domain.


                                               Article V C Ordinance of Revocation


No revocation provided for in the previous paragraph except for reasons of condemnation shall be effective unless or until the city council shall have adopted an ordinance setting forth the cause and reason for the revocations and the effective date thereof, which ordinance shall not be adopted without 30 days prior notice thereof to the grantee and an opportunity for the grantee to be heard on the proposed adoption of the proposed ordinance. If the revocations as proposed and the ordinance depends upon a finding of fact, such finding of fact shall be made by the city council after a hearing is provided for, if requested by the grantee and shall be conclusive.


                                                       Article VI C Consideration


Section 1.  Franchise Fee.  (a)  In consideration of the grant of the franchise to the grantee, the grantee shall pay to the city an amount equal to three percent of the gross revenue from the operation of the business in the city, such payments, together with all reports required by law and the governing body of the city, shall be made semi-annually within 30 days of June 30 and December 31 of each year during the term of this franchise.

(b)    Grantee, upon tendering to the city the amount due, shall furnish to the city a statement of its gross receipts for the six month period covered by the payment. The city shall have access to and the right to examine, at all reasonable times, all books, receipts, files, records and documents of the grantee necessary to verify the correctness of the semi­-annual statement and to correct the same if found to be erroneous. If errors are found in grantee=s statement of gross receipts, then payments shall be made upon such corrected statements.


Section 2.  Pole Fees. Grantee may make use of existing poles and other facilities available to grantee (except such poles as the city specifically exempts), subject to grantee=s obtaining any necessary consents for such use, and grantee may also erect its own poles and install its own conduit, with approval of the city, which approval shall not be unreasonably withheld. Grantee shall pay to the city as and for rental of such poles used, the sum of $3 per pole per year, payable on or before the first day of April of each year for the preceding calendar year ending December 31. Within six months after the effective date of this ordinance, grantee shall provide to the city a proper map showing and describing the location of all of its facilities within the city streets, alleys and public ways including underground cables and equipment. During each calendar year thereafter, grantee shall provide revisions to these maps showing all relocations and/or extensions of its system within the city limits.


                                                      Article VII C Indemnification


Section 1.  Indemnity.  (a) Grantee shall indemnify and hold harmless the city at all times during the term of this franchise from and against any and all claims for injury or damage to persons or public and/or private property, both real and personal, occasioned by grantee=s construction, repair, maintenance, or operation of the system or by the conduct of the grantee=s business in the city. No claim for indemnification shall be valid unless grantee is provided with notice of the respective injury, loss or claim promptly after the occurrence thereof, and is provided with full and timely opportunity to defend.

(b)    Grantee shall pay all damages and penalties which the city may legally be required to pay as a result of the granting of this franchise. Grantee shall pay all expenses incurred by the city in defending itself with regard to all damages and penalties mentioned in this section, including out-of-pocket expenses, court costs and attorney=s fees.


Section 2.  General Liability Insurance. The grantee shall concurrently with the filing of the acceptance of this franchise furnish to the city and file with the city clerk at all times during the existence of this franchise and maintain in full force at its own cost and expense, a general liability insurance policy in the amount of $1,000,000 with a company approved by the city and in a form satisfactory to the city attorney indemnifying and defending the city, its officers, boards, commission, agents and employees from and against any and all claims, demands, actions, suits and proceedings by others, against all liabilities to others including, but not limited to, any liability for damages by reason of, or arising out of, any failure by the grantee to secure consents from the owners, authorized distributors or licensees of programs to be transmitted or to be distributed by the grantee, and against any loss, costs, expense or damages resulting therefrom, arising out of the exercise or enjoyment of its franchise, irrespective of the amount of comprehensive liability policy required hereunder.


Section 3.  Comprehensive General Liability and Workman=s Compensation Insurance. The grantee shall also concurrently with the filings of its acceptance of this franchise furnish to the city and file with the city clerk at all times during the term of this franchise, maintain in full force and effect at its own costs and expense, workman=s compensation insurance sufficient to comply with all state requirements, and a comprehensive general liability insurance policy indemnifying and defending the city, its officers, boards, commissions, agents and employees with a company approved by the city and in a form satisfactory to the city attorney, from and against all claims by any person whatsoever for loss, for damage, of personal injury, or death from the franchise herein granted, or alleged to so have been caused or occurred, or with respect to the construction, operation, repair, and maintenance of the system which insurance shall name the city as an additional insured, in amounts not less than the following:

(1)    Public liability/general liability for bodily injury, including death, $1,000,000 for any one individual, and $3,000,000 for any one accident; and

(2)    For property damage, $1,000,000. Upon request by the city, grantee shall provide the city with satisfactory written evidence of such insurance.

(3)    Umbrella liability insurance of $3,000,000 to any one person and $5,000,000 as to any one accident.

(4)    Automobile liability insurance with limits of $1,000,000/$1,000,000 and automobile property damage insurance with a limit of not less than $1,000,000.


                                                 Article VIII C Use and Installation


Section 1.  Degree of Care. The grantee or any persons, firm or corporation erecting, constructing or maintaining any of the property used by or for the grantee shall at all times employ due care or the highest degree of care required by law under the facts and circumstance and shall maintain and install the property of the grantee in accordance with commonly accepted methods and principals so as to prevent failures and accidents likely to, or which may tend to cause damage, injury or nuisance to the public.


Section 2.  Location of Facility. All cable television facilities shall be so located as to cause minimum interference with the proper use of streets, and so as to cause minimum interference with rights and reasonable convenience of property owners abutting the streets, and in no event shall any of such facilities be located so as to substantially interfere with the usual public travel on any street of the city.


Section 3.  Damage to Public Property.  Any and all public property which is damaged directly by grantee, or any person on its behalf, during construction, or operation of the system, including damage to any pavement, sidewalk, driveway or other surface, shall be promptly repaired by grantee at its own expense and returned to a condition reasonably comparable to its condition prior to such damage.


Section 4.  Trimming of Trees.  Subject to advance approval by the city, grantee shall have the right to cut or trim trees and vegetation in the vicinity of its cable or equipment so as to prevent the branches of the trees from coming into contact with the wires and equipment of grantee. At the option of the city, the trimming necessary may be done by the city, at the expense of grantee.


Section 5.  Temporary Removal of Facilities.  In the event that it is necessary temporarily to move or remove any of grantee=s aerial lines, poles, equipment or other facilities in order lawfully to transport a large object, vehicle, building or other structure over any public property, then upon two business days prior notice from the city to grantee, grantee shall temporarily move or remove much of its facilities as may be necessary to permit such transport. Grantee shall be entitled to a reasonable amount for reimbursement for the costs of such temporary move or removal from the person making such request, and grantee may require such reimbursement in advance.


Section 6.  Relocation of Facilities.  If at any time during the term of this franchise, the city shall lawfully elect to construct, repair, widen, alter, relocate or change the grade of any public property, then upon reasonable notice by the city, grantee shall remove, relay and relocate its lines, poles, equipment and other facilities at its own expense; provided, however, that where public funds or funds from owners are available for such relocation pursuant to law, grantee shall not be required to pay the cost.


                                                        Article IX C Maps or Plats


The grantee shall file with the city clerk=s office true and accurate maps or plats of all existing or proposed installation systems on the streets, alleys, or public right-of-ways or other public property.


                                            Article X C Operation and Maintenance


The grantee shall render efficient service, make repairs promptly and only interrupt service for good cause for the shortest time possible. Interruptions for system maintenance insofar as possible shall be proceeded by notice to subscribers and shall occur during off-peak hours of minimum use of the system.

In order to limit failures and malfunctions of the cable television system to a minimum, and that the same might be promptly corrected at all times after notice of malfunction or failure, the grantee shall consistently maintain a local office with a listed telephone, which telephone shall so be operated that complaint for request for repairs or adjustments because of malfunctions can be received at any time of day.

Failure or malfunctions of the system shall be corrected by the grantee within 24 hours after notice of such failure or malfunctions except or unless such failure or malfunction shall be over a substantial portion of grantee=s system and shall have been caused by storm, fire, lightning, explosion, civil commotion or other similar catastrophe.




                                                 Article XI C Program Presentation


All programs of broadcasting stations carried by the grantee shall be distributed or transmitted to the subscriber without material degradation of picture quality or sound and without significant variation between the quality of picture and sound transmitted or distributed by the grantee to the subscribers between the programs of one broadcasting station and another, so far as the same may be within the control of the grantee.


                                             Article XII C Compliance with the Law


Grantee shall, at all times during the term of this franchise, be subject to all lawful exercises of the police power of the city and to such reasonable regulations as the city shall prescribe for the general conduct of persons providing cable television service within the city.


                                                     Article XIII C Emergency Use


In the event of an emergency or disaster, the grantee shall, at the request of the city, make available its facilities to the city for emergency use during periods of such emergency or disaster and shall provide such personnel to operate properly under the circumstances.


                                           Article XIV C Sale or Lease of Franchise


The franchise shall be deemed a privilege to be held in personal trust by the grantee. It may not be sold, transferred, leased, assigned or disposed of in whole or in part whether by force or voluntary sale, consolidation or otherwise without the prior consent of the city council, expressed by resolution, and then only under such conditions as may therein be prescribed.


                                            Article XV C Grantee Without Recourse


The grantee shall have no recourse whatsoever against the city for any loss, cost, expense or damage arising out of any of the provisions or requirements of this franchise or because of the enforcement thereof by the city, nor for the failure of the city to have the authority to grant all or any part of the franchise.


                                                   Article XVI C System Extension


The grantee shall, whenever it receives a request for service, provide service to any potential subscriber presently within the city limits and to such additional territory as the city may later annex, and the grantee shall extend its existing system to such subscriber at no cost to the subscriber for the system extension other than the usual connect fees for all subscribers. If grantee does not extend its services after request to do so, the city can cancel the franchise in accordance with the revocation provisions of this ordinance.


                                         Article XVII C Basic Service Requirements


The service or system shall be designed with stereo sound, and with capability in the future for digital transmission, and shall carry, at a minimum, the following:

A.     Three local area networks mutually agreed upon; and

B.     One educational television channel.


                                                            Article XVIII C Notice


All notices, requests, demands and other communications required or permitted hereunder shall be in writing and shall be deemed to have been duly given if delivered by hand, or mailed by certified or registered mail (return receipt requested) properly addressed with postage prepaid:

(1)    If to the city, to:

City Clerk

631 S Main, PO Box 788

Hugoton, KS 67951


or to such other person or address as the city shall furnish to grantee in writing in accordance herewith; and


(2)    If to Grantee, to:

Pioneer Telephone Association, Inc.

Attn:          Richard K. Veach

120 West Kansas Avenue, P.O. Box 707

Ulysses, KS 67880


or to such other person or address as grantee shall furnish to the city in writing in accordance herewith.


                                           Article XIX C Service to Public Facilities


The grantee shall provide without charge one connection to each elementary, high school, public or parochial school, and to each public library, and to the city office building and the city power plant and to provide basic service to these connections without charge.


                                             Article XX C Miscellaneous Provisions


Obligation to Remove System Upon Termination of Franchise.  At the termination of this franchise, grantee shall be obligated to remove all portions of the cable television system, free of cost to the city. The city shall also have the option to purchase any and all of such system upon termination of the franchise upon such terms and conditions as may be agreeable between the parties.


Severability. If any law, ordinance, regulation or court decisions shall render any provision of this franchise invalid, the remaining provisions of this franchise shall remain in full force and effect.


Force Majeure. Any failure or delay by grantee in its performance of any  provision of this franchise shall not be deemed a noncompliance with or a violation or breach of this franchise if such failure or delay is attributable to any Act of God or is due to any other circumstance beyond the reasonable control of grantee.


Publication Costs.  All expenses of publishing this ordinance, or publication notices required hereunder, shall be paid by grantee.


Late Payment Penalty.  In the event any payment due hereunder is not paid within 30 days from the date such payment is due, grantee shall be required to pay a penalty in an amount of 10 percent on the unpaid balance. Grantee shall be required to pay an additional penalty in an amount of one percent of the unpaid balance for each month thereafter that such account is past due.  Provided, further, that any payment not paid within 30 days from the due date thereof, shall be grounds for revocation of this franchise agreement, as provided above.


Entire Agreement.  This franchise represents the entire understanding and agreement between the parties hereto with respect to the subject matter hereof, supersedes all prior oral or written negotiations between the parties, and can be amended, supplemented, modified, or changed only by an agreement in writing which makes specific reference to this franchise and which is signed by the party against whom enforcement of any such amendment, supplement, modification or change is sought.


Descriptive Headings.  The captions to sections contained herein are intended solely to facilitate the reading thereof.  Such captions shall not affect the meaning or interpretation of the text herein.


Severability.  If any section, sentence, paragraph, term, or provision hereof is determined to be illegal, invalid, or unconstitutional, by any court of competent jurisdiction or by any state or federal regulatory authority having jurisdiction thereof, such determination shall have no effect on the validity of any other section, sentence, paragraph, term, or provisions hereof, all of which shall remain in full force and effect for the term of the franchise, or any renewal or renewals thereof.


Governing Law.  This franchise shall be governed by and construed in accordance with the laws of the State of Kansas and applicable federal law.







Section 1. The Pioneer Telephone Association, Inc., a Kansas corporation, its successors and assigns, (herein referred to as "Telephone Company") shall continue to operate its telephone system and all business incidental to or connected with the conducting of a telephone business and system in the City of Hugoton, State of Kansas, (herein referred to as "City"). The plant construction and appurtenances used in or incident to the giving of telephone service and to the maintenance of a telephone business and system by the Telephone Company in said City shall remain as now constructed, subject to such changes as may be considered necessary by the City in the exercise of its inherent powers and by the Telephone Company in the conduct of its business, and said Telephone Company shall continue to exercise its right to place, remove, construct, and reconstruct, extend and maintain its said plant and appurtenances as the business and purposes for which it is or may be incorporated may from time to time, require along, across, on, over, through, above and under all the public streets, avenues, alleys, bridges and the public grounds and places within the limits of said City as the same, from time to time, may be established.

Section 2. The Telephone Company shall exercise its rights and privileges granted by this Ordinance for a term of ten (10) years, retroactive beginning February 28, 1998, and ending February 28, 2008, and for additional five (5) year periods until and unless the City or Telephone Company give written notice six (6) months prior to the date of termination of its intent to terminate this franchise, and shall make payments to the City as follows: the Telephone Company shall pay to the City a sum equal to three (3% ) of the gross revenues for local exchange telephone communication service rendered wholly within the corporate limits of the City of Hugoton, Kansas, during the above stated ten (10) year term. Such payments shall be made semiannually on April 1st and October 1st of each year, commencing on April 1, 1998. Each semi‑annual payment shall represent payment for the preceding six month period ending December 31st  or June 30th respectively.

Section 3. The poles, wires, cables, conduits, pipes, and appliances erected or to be erected by the Telephone Company, either under or above ground, shall be erected, laid, placed, or constructed in conformity with the rules, regulations, and ordinances of the City of Hugoton, Kansas, adopted by said City in the reasonable exercise of its police power provided that any excavations by the Telephone Company in any of the streets, alleys, avenues, roads, or public grounds within the corporate limits of said City shall be done in accordance with such rules, resolutions, and ordinances now existing or to be enacted by the Governing Body of the City relating to excavations in streets, alleys, and public grounds of such City and under the direction and supervision of such officials who may, from time to time, be vested with the supervision over the streets and alleys of the City. The said Telephone Company, its successors and assigns, shall remove or relocate its conduits, lines, poles, and any other telephone utility installation located in the streets, alleys, and public grounds of the City when necessary to make way for public improvements or other works of public nature when required, such removal or relocation to be at the expense of the Telephone Company, its successors and assigns and without expense to the City.

Section 4. The Telephone Company shall hold and save the City of Hugoton, Kansas, harmless for all cost and damage, expense or liability which may be occasioned solely by the Telephone Company's occupancy in the streets, alleys, and public grounds of the City, and in the event an action shall be instituted against the City separately drawing out of injury or damage or both occasioned solely by such occupancy of the streets, alleys, and public grounds in the City by the properties of the Telephone Company then, upon notice by the City to the Telephone Company, the Telephone Company will assume liability for the defense of such action at the cost of the Telephone Company subject to the option of the City to appear and defend, at its own cost, any such case.

Section 5. The Telephone Company, its successors and assigns, in the construction, maintenance and operation of its telephone system shall use all reasonable and proper precaution to avoid damage or injury to persons or property and shall hold and save harmless the City of Hugoton, Kansas, from any and all damages, injury and expense caused by the negligence of the Telephone Company, its successors and assigns or its or their agents or servants.

Section 6. The Telephone Company shall and it is hereby required to make true and faithful reports to the City Clerk of such information as may be necessary to determine the amounts of such payments due to the City.

Section 7. The Telephone Company, on the request of any person, shall remove or raise or lower its wires temporarily to permit the moving of houses or other structures. The expense of such temporary removal, raising, or lowering of wires shall be paid by the party or parties requesting the same, and the Telephone Company may require such payment in advance. The Telephone Company shall be given not less than 48 hours advance notice to arrange for such temporary wire changes.

Section 8. Permission is hereby granted to the Telephone Company to trim trees upon and overhanging streets, alleys, sidewalks and public places of said City so as to prevent the branches of such trees from coming in contact with the wire and cables of the Telephone Company, all the said trimming to be done under the supervision and direction of any City official to whom said duties have been or may be delegated.

Section 9. Nothing in this Ordinance shall be construed to require or permit any telephone, electric light, or power wire attachments by either the City or the Telephone Company, on the poles of the other. If such attachments are desired by the City or the Telephone Company, then a separate non‑ contingent agreement shall be pre‑requisite to such attachments.

Section 10.  Upon the expiration of this Ordinance, all rights of said Telephone Company granted under this Ordinance shall terminate.

Section 11. That in the event of a sale or transfer of ownership of Telephone Company, the term of this franchise shall terminate one (1) year from the effective date of the transfer or sale. Within said one (1) year period, the new entity shall be required to renegotiate a new franchise agreement with the City of Hugoton.

Section 12.  Nothing herein contained shall be construed as giving to the Telephone Company any exclusive franchise, right, or privilege whatever, nor shall it affect any prior or existing rights of the Telephone Company to maintain a telephone system within the City.

Section 13.  All other Ordinances and Agreements and parts of Ordinances and Agreements relating to the operation of or right to operate a telephone system within said City by said Telephone Company are hereby repealed, which repeal shall take effect upon the effective date of this Ordinance.

Section 14.  This Ordinance shall be read in full at three (3) regular or adjourned meetings of the Governing Body and immediately after its final adoption and passage shall be published in the official city newspaper once a week for two (2) consecutive weeks and shall not take effect and be enforced until after the expiration of sixty (60) days from date of its final adoption and passage and further subject to the right of Petition for submission of its adoption to a special election, all as provided by law, and acceptance by Telephone Company within sixty (60) days from date of its final adoption and passage.

Section 15. The Telephone Company shall assume the cost of publication of this franchise, as such publication is required by law. A bill for publication cost shall be presented to the Telephone Company by the City and the City shall be reimbursed at that time.


Ordinance No.762


An Ordinance granting Black Hills/Kansas Gas Utility Company, LLC, a Kansas limited liability company d/ba/ Black Hills Energy, its lessees, successors and assigns, a natural gas franchise and the authority to construct, operate, maintain, and extend a natural gas distribution plant and system, and granting the right to use the streets, alleys, and other public places within the present or future corporate limits of the City of Hugoton, Kansas


Be it ordained by the Governing Body of the City of Hugoton, Kansas, as follows:



The City of Hugoton, Kansas (hereinafter referred to as 'Grantor'), hereby grants a non‑exclusive franchise to Black Hills/Kansas Gas Utility Company, LLC, a Kansas limited liability company d/ba/ Black Hills Energy, (hereinafter called "Grantee"), its lessees, successors and assigns. Grantee is hereby granted the right, privilege, franchise, permission and authority to lay, construct, install, maintain, operate and extend in, along, over or across the present and future streets, alleys, avenues, bridges, public rights‑of‑way and public places as are now within the present or future limits of said Grantor, a natural gas distribution system and all facilities necessary for the purpose of supplying natural gas or processed gas and other operations connected therewith or incident thereto for all purposes to the inhabitants of said Grantor and consumers in the vicinity thereof, and for the distribution of natural gas from or through said Grantor to points beyond the limits thereof. Such facilities shall include, but not be limited to, all mains, services, pipes, conduits and all other apparatus and appliances necessary or convenient for transporting, distributing and supplying natural gas for all purposes for which it may be used, and to do all other things necessary and proper in providing natural gas service to the inhabitants of Grantor and in carrying on such business.

Grantee agrees for and in behalf of itself, its lessees, successors and assigns, that for and during the term and period of this grant, it will maintain in the City of Hugoton, Kansas, an adequate, modern, standard and sufficient gas system and equipment, and to maintain and operate the same in a modern and adequate fashion and in a manner adequate to meet the necessities and requirements of the City of Hugoton, its industries and inhabitants.



The rights and privileges granted hereunder shall remain in effect for a period of fifteen (15) years from the effective date of this Ordinance.



In exchange for the franchise granted herein, Grantee shall collect from its gas customers located within the corporate limits of Grantor and pay to Grantor an amount equal to three percent (3%) of gross receipts Grantee derives from the sale, distribution or transportation of gas delivered within the present or future limits of Grantor. Gross receipts as used herein are revenues received from the sale, distribution or transportation of gas, after adjustment for the net write‑off of uncollectible accounts and corrections of bills theretofore rendered. The amount paid by Grantee shall be in lieu of and Grantee shall be exempt from, all other fees, charges, taxes or assessments which the Grantor may impose for the privilege of doing business within the present or future corporate limits of Grantor, including, without limitation, excise taxes, occupation taxes, licensing fees, or right‑of‑way permit fees, and in the event the Grantor imposes any such fee, charge, tax or assessment, the payment to be made by Grantee in accordance with this section shall be reduced in an amount equal to any such fee, charge, tax or assessment imposed upon the Grantee, However, Grantee shall not be exempt from and shall remain obligated to pay: (1) ad valorem property taxes imposed generally upon all real and personal property; and (2) all fees, licenses and permits for business activities not directly associated with the sale and delivery of natural gas within the City.

Grantee shall report and pay any amount payable under this section on a semi‑annual basis. Such payment shall be made no more than thirty (30) days after June 30 and December 31 of each year during the franchise period. Initial and final payments shall be prorated for the portions of the periods at the beginning and end of the term of this Ordinance.

Grantee shall list the franchise fee collected from customers as a separate item on bills for utility service issued to its customers. If at any time the Kansas Corporation Commission or other authority having proper jurisdiction prohibits such recovery, Grantee will no longer be obligated to collect and pay the franchise fee. In addition, with Grantor's approval. Grantee may reduce the franchise fee payable for gas delivered to a specific customer when such reduction is required to attract or retain the business of that customer.

Grantor shall provide copies of annexation ordinances to Grantee on a timely basis to ensure appropriate franchise fee collection from customers within Grantor's corporate limits. Grantee's obligation to collect and pay the franchise fee from customers within an annexed area shall not commence until the later of: (a) sixty (60) days after Grantee's receipt of the annexation ordinance pertaining to such area, or (b) such time as is reasonably necessary for Grantee to identify the customers in the annexed area obligated to pay the franchise fee.

Grantor shall have access to and the right to examine, during normal business hours, such of Grantee's books, receipts, files, records and documents as is necessary to verify the accuracy of payments due hereunder. If it is determined that a mistake was made in the payment of any franchise fee required hereunder, such mistake shall be corrected promptly upon discovery such that any under‑payment by Grantee shall be paid within thirty (30) days of recalculation of the amount due, and any over‑payment by Grantee shall be deducted from the next payment of such franchise fee due by Grantee to Grantor.



The franchise granted hereunder is subject to all conditions, limitations and immunities now provided for, or as hereafter amended, and applicable to the operations of a public utility , by state or federal law. The rates to be charged by Grantee for service within the present or future corporate limits of Grantor and the rules and regulations regarding the character, quality and standards of service to be furnished by Grantee, shall be under the jurisdiction and control of such regulatory body or bodies as may, from time to time, be vested by law with authority and jurisdiction over the rates, regulations and quality and standards of service to be supplied by Grantee. In determining the rights and duties of the Grantee, the terms of this Ordinance shall take precedence over any conflicting terms or requirements contained in any other ordinance enacted by the Grantor.



If an energy supplier is unable to furnish an adequate supply of energy due to an emergency, an order or decision of a public regulatory body, or other acts beyond the control of the Grantee. then the Grantee shall have the right and authority to adopt reasonable rules and regulations limiting, curtailing or allocating extensions of service or the supply of energy to any customers or prospective customers, and withholding the supply of energy to new customers, provided that such rules and regulations shall be uniform as applied to each class of customers or prospective customers, and shall be nondiscriminatory as between communities receiving service from the Grantee.



Any pavements, sidewalks or curbing taken up and any and all excavations made shall be done in such a manner as to cause only such inconvenience to the inhabitants of Grantor and the general public as is reasonably necessary, and repairs and replacements shall be made promptly by Grantee, leaving such properties in as good as condition as existed immediately prior to excavation.

Grantee agrees that for the term of this franchise it will use its best efforts to maintain its facilities and equipment in a condition sufficient to meet the current and future energy requirements of Grantor, its inhabitants and industries. While maintaining its facilities and equipment. Grantee shall obtain permits as required by ordinance, except that in emergency situations Grantee shall take such immediate unilateral actions as it determines are necessary to protect the public health, safety, and welfare; in which case, Grantee shall notify Grantor as soon as reasonably possible.

Grantor will give Grantee reasonable notice of plans for street improvements where paving or resurfacing of a permanent nature is involved that affects Grantee's facilities. The notice shall contain the nature and character of the improvements, the rights‑of‑way upon which the improvements are to be made, the extent of the improvements, and the time when the Grantor will start the work, and, if more than one right‑of‑way is involved, the order in which the work is to proceed. The notice shall be given to the Grantee a sufficient length of time in advance of the actual commencement of the work, considering seasonable working conditions, to permit the Grantee to make any additions, alterations, or repairs to its facilities.



Upon receipt and acceptance of a valid application for service, Grantee shall, subject to its own economic feasibility criteria, make reasonable extensions of its distribution facilities to serve customers located within the current or future corporate limits of Grantor.



If Grantor elects to change the grade of or otherwise alter any street, alley. avenue, bridge, public right‑of‑way or public place for a public purpose, Grantee, upon reasonable notice from Grantor, shall remove and relocate its facilities or equipment situated in the public rights‑of‑way, at the cost and expense of Grantee, if such removal is necessary to prevent interference and is not merely for the convenience of the Grantor. If Grantor orders or requests Grantee to relocate its facilities or equipment for the primary benefit of a commercial or private project, or as a result of the initial request of a commercial or private developer or other non‑public entity, and such removal is necessary to prevent interference and is not merely for the convenience of the Grantor or other right‑of‑way user, Grantee shall receive payment for the cost of such relocation as a precondition to relocating its facilities or equipment. Grantor shall consider reasonable alternatives in designing its public works projects and exercising its authority under this section so as not to arbitrarily cause Grantee unreasonable additional expense. Grantor shall also provide a reasonable alternative location for Grantee's facilities. Grantor shall give Grantee written notice of any order or request to vacate a public right‑of‑way containing any of the Grantee's facilities; provided, however, that its receipt of such notice shall not deprive Grantee of its right to operate and maintain its existing facilities in such public right‑of‑way, subject to the following. If the public right‑of‑way is being vacated at the Grantor's request, the Grantee may continue to operate and maintain its existing facility in such right‑of‑way, until it receives the reasonable cost of relocating the same and Grantor provides a reasonable alternative location for such facilities. If the public right‑of‑way is being vacated at the request of someone other than the city and the city has objected to the vacating of the public right‑of‑way, then in such case, the city shall not be responsible for the reasonable cost of relocating the same or for providing a reasonable alternative location for such facilities and Grantee may require the third party to pay its relocation expenses.

Any person or corporation desiring to move a building or other structure along, or to make any unusual use of, any street, alley, avenue, bridge, public right‑of‑way or public place which shall interfere with the facilities or equipment of the Grantee, shall first give notice to the Grantor and the Grantee and pay a sum sufficient to cover the expense of moving Grantee's facilities and equipment in such location, and any damages incident thereto.


Grantor acknowledges that certain information it might request from Grantee pursuant to this Ordinance may be of a proprietary and confidential nature, and that such requests may be subject to the Homeland Security Act or other confidentiality protections under state or federal law. If Grantee requests that any information provided by Grantee to Grantor be kept confidential due to its proprietary or commercial value, Grantor and its employees, agents and representatives shall maintain the confidentiality of such information, to the extent allowed by law. If Grantor is requested or required by legal or administrative process to disclose any such proprietary or confidential information, Grantor shall promptly notify Grantee of such request or requirement so that Grantee may seek an appropriate protective order or other relief.



It shall not be a breach or default under this Ordinance if either party fails to perform its obligations hereunder due to force majeure. Force majeure shall include, but not be limited to, the following: 1) physical events such as acts of God, landslides, lightning, earthquakes, fires, freezing, storms, floods, washouts. explosions, breakage or accident or necessity of repairs to machinery, equipment or distribution or transmission lines; 2) acts of others such as strikes, work‑force stoppages, riots, sabotage, insurrections or wars; 3) governmental actions such as necessity for compliance with any court order, law, statute, ordinance, executive order, or regulation promulgated by a governmental authority having jurisdiction; and (4) any other causes, whether of the kind herein enumerated or otherwise not reasonably within the control of the affected party to prevent or overcome. Each party shall make reasonable efforts to avoid force majeure and to resolve such event as promptly as reasonably possible once it occurs in order to resume performance of its obligations hereunder; provided, however, that this provision shall not obligate a party to settle any labor strike.



Grantee, during the term of this Ordinance, agrees to save harmless Grantor from and against all claims, demands, losses and expenses arising directly out of the negligence of Grantee, its employees or agents, in constructing, operating, and maintaining its distribution and transmission facilities or appliances; provided, however, that Grantee need not save Grantor harmless from claims, demands, losses and expenses arising out of the negligence of Grantor, its employees or agents.



All rights, privileges and authority granted to Grantee hereunder shall inure to the benefit of Grantee's lessees, successors and assigns, subject to the terms, provisions and conditions herein contained, and all obligations imposed upon Grantee hereunder shall be binding upon Grantee's lessees, successors and assigns. Such assignment shall require the written consent of Grantee, which shall not be unreasonably withheld.




This Ordinance constitutes a franchise agreement between the Grantor and Grantee. No provision of this Ordinance shall inure to the benefit of any third person, including the public at large, so as to constitute any such person as a third party beneficiary of the agreement or of any one or more of the terms hereof, or otherwise give rise to any cause of action for any person not a party, hereto.



If any clause, sentence or section of this Ordinance is deemed invalid by any judicial, regulatory or legislative body having proper jurisdiction, the remaining provisions shall not be affected.



Any waiver of any obligation or default under this Ordinance shall not be construed as a waiver of any future defaults, whether of like or different character.



This Ordinance, when accepted by Grantee as provided below, shall constitute the entire agreement between the Grantor and the Grantee relating to the franchise granted by Grantor, hereunder, and the same shall supersede all prior ordinances relating thereto, and any terms and conditions of such prior ordinances or parts of ordinances in conflict herewith are hereby repealed. Ordinance No. 595 of the City of Hugoton, Kansas, is hereby repealed as of the effective date hereof.



The captions that precede each section of this Ordinance are for convenience and/or reference only and shall not be taken into consideration in the interpretation of any of the provisions of this Ordinance.



This Ordinance shall become effective and be a binding contract between the Grantor and Grantee upon its final passage and approval by Grantor, in accordance with applicable laws and regulations, and upon Grantee's acceptance by written instrument, within sixty (60) days of passage by the Governing Body and filing with the Clerk of the City of Hugoton, Kansas. The Clerk of the City of Hugoton, Kansas shall sign and affix the community seal to acknowledge receipt of such acceptance, and return one copy to Grantee. If Grantee does not, within sixty (60) days following passage of this Ordinance, either express in writing its objections to any terms or provisions contained therein, or reject this Ordinance in its entirety, Grantee shall be deemed to have accepted this Ordinance and all of its terms and conditions.


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