§ 12. Fee for franchise; minimum fee  


Latest version.
  • (a) In consideration of the rights granted the Company by this franchise, the Company agrees to pay the City a fee based upon the annual gross revenues that the Company derives from advertising on shelters located within the City in accordance with the following schedule:

    (1) Twelve (12) percent for the remainder of 1989.

    (2) Six (6) percent in 1990.

    (3) For 1991 and thereafter the following percentages of annual gross revenues:

    a. If annual gross revenues are less than seven hundred thousand dollars ($700,000.00): Six (6) percent.

    b. If annual gross revenues are seven hundred thousand dollars ($700,000.00) or more, but less than nine hundred thousand dollars ($900,000.00): Eight (8) percent.

    c. If annual gross revenues are nine hundred thousand dollars ($900,000.00) or more, but less than one million one hundred thousand dollars ($1,100,000.00): Ten (10) percent.

    d. If annual gross revenues are one million one hundred thousand dollars ($1,100,000.00) or more, but less than one million four hundred thousand dollars ($1,400,000.00): Twelve (12) percent.

    e. If annual gross revenues are more than one million four hundred thousand dollars ($1,400,000.00): Thirteen (13) percent.

    Notwithstanding subsection (3) above, the franchise fee for the years 2000, 2001 and 2002 shall be no less than twelve (12) percent, and shall be thirteen (13) percent for 2003 through 2009 2010.

    By renewing this franchise from November 9, 1999 to June 30, 2010, the company guarantees that the franchise fee paid to the City, after adjustment for credits allowed to the company, shall be at least one hundred thousand dollars ($100,000.00) each for the years 2000, 2001 and 2002, and, at least one hundred ten thousand dollars ($110,000.00) each for the years 2003 through 2010. If necessary, the fee payable for the final quarter of any year in which said minimum guarantee applies shall be computed and adjusted as provided in subsection (b) of this section so that no less than the minimum guaranteed fee shall be paid to the City with respect to any year.

    (b) The fee shall be paid to the City quarterly within thirty (30) days after the expiration of each calendar quarter. Each payment shall be based upon the gross revenues received in the calendar quarter immediately preceding the day of payment, except in the case of the last payment when the fee shall be paid within thirty (30) days after the expiration, termination or cancellation of the contract. The quarterly fee payment due shall be determined by multiplying the gross revenues for the quarter by that percentage that would be applied under subsection (a) assuming that the annual gross revenues will be four (4) times the gross revenues for the first quarter, two (2) times the revenue for the first and second quarters cumulatively, and one and one-third (11/3) times the revenue for the first, second and third quarters cumulatively. The fee payment due for the final quarter of the year shall be computed and adjusted, so that the total annual fee paid will be correct, applying the applicable percentage set forth in subsection (a) to the actual gross revenues for the entire year.

    (c) The gross revenue is defined as all advertising revenue derived directly or indirectly by the company, its affiliates, subsidiaries, parent or any person in which the company has a financial interest, from or in connection with the operation of the franchise prior to any deduction; provided, however, that this shall not include any taxes on services furnished by the Company herein imposed directly upon any advertiser by the City, state or other governmental unit and collected by the Company on behalf of said governmental unit.

    (d) The company shall receive a credit against the franchise fee equal to ten (10) percent of that portion of its annual Minneapolis shelter maintenance costs that exceeds the maintenance ceiling amount. The maintenance ceiling amount shall be eighty-four thousand dollars ($84,000.00) for 1990 and shall be adjusted for 1991 and annually thereafter in a percentage equal to annual increases in the consumer price index (CPI). The shelter maintenance costs shall include the unrecovered cost of repairs made to Minneapolis shelters due to damage and vandalism. The credit shall be applied first to the portion of the franchise fee that is payable for the first quarter of the calendar year following the year that the credit accrues, beginning with the portion of maintenance costs incurred in 1990, if any, to be credited against the first quarterly payment of 1991. Any portion of a credit that cannot be used because insufficient fee payments are due may be carried over to be applied against fee payments with respect to the ensuing quarters of the same year, but may not be carried over to be applied against fee payments for ensuing years. Under no circumstances shall the credit allowed the Company hereunder result in any obligation of the City to pay or reimburse the Company for any shelter maintenance costs, nor shall such credit entitle the Company to set off such costs against any monetary or nonmonetary obligations or duties owed by the Company to the City other than the franchise fee. The maintenance ceiling amount shall be set at one hundred six thousand four hundred eighty dollars ($106,480.00) for the year 2000 subject to annual adjustment for 2001 and thereafter in a percentage equal to annual CPI adjustments. (2010-Or-043, § 1, 4-16-10)