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HomeMy WebLinkAbout28E agreement - amended and restated singed 11.9.23AMENDED AND RESTATED AGREEMENT UNDER IOWA CODE CHAPTER 28E BETWEEN WAVERLY COMMUNICATIONS UTILITY, THE MUNICIPAL COMMUNICATIONS UTILITY OF THE CITY OF CEDAR FALLS, THE COMMUNICATIONS UTILITY OF BELLEVUE, IOWA, INDIANOLA MUNICIPAL UTILITIES, VINTON MUNICIPAL COMMUNICATIONS UTILITY, CITY OF PELLA MUNICIPAL TELECOMMUNICATIONS UTILITY, NEW HAMPTON MUNICIPAL COMMUNICATIONS UTILITY, AND WATERLOO TELECOMMUNICATIONS UTILITY PROVIDING FOR JOINT OWNERSHIP AND USE OF CERTAIN FACILITIES AND RELATED MATTERS BE IT REMEMBERED that for the mutual promises, covenants and considerations herein contained and pursuant to Iowa Code Chapter 28E, Waverly Communications Utility ("Waverly"), The Municipal Communications Utility of the City of Cedar Falls, Iowa ("CFU"), the Communications Utility of Bellevue, Iowa ("CUB"), Indianola Municipal Utilities ("IMU"), Vinton Municipal Communications Utility ("Vinton"), City of Pella Municipal Telecommunications Utility ("Pella"), New Hampton Municipal Communications Utility ("New Hampton"), and Waterloo Telecommunications Utility ("Waterloo"), all municipal utilities in good standing, organized, operating and existing under Iowa Code Chapter 388, have entered into the following agreement, to wit: 1.The purpose of this Agreement is to provide for the joint ownership, management, control and maintenance of an Internet Protocol (IP) Video Head End, and make available certain other shared services, equipment, appliances and appurtenances for the joint benefit of the parties. This Agreement does not include programming contracts. 2.CFU has installed in its headquarters building in Cedar Falls an IP Video Head End, including from time to time, needed software, licensing and hardware. The parties' joint ownership under this Agreement is as tenants in common with a separate individual ownership in each party. 3.It is understood CFU has utilized and incorporated some prior existing video infrastructure equipment, dishes, receivers and other apparatus into the IP Video Head End described in paragraph 2 hereof. 4.In order to facilitate and provide for services under this Agreement, each party agrees to construct at its own expense a fiber link to agreed upon Meet Points. Upon request, CFU will provide technical assistance regarding equipment selection and configuration of the fiber links. The fiber links thus constructed will be lit, managed and monitored by CFU Network -1- Engineers under paragraphs 5 and 8 hereof. Maintenance and repair of each party's fiber will be performed by the respective party. 5.CFU will provide the Head End Technicians and Network Engineers required to operate the IP Video Head End. The Head End Technicians and Network Engineers will be employees of CFU and shall not have any separate rights or standing under this Agreement. Each party to this Agreement shall be invoiced monthly by CFU for their proportionate share of the salary and benefits of one Head End Technician, and two and one-half Network Engineers. All parties will pay the invoice within 30 days of receipt. The percentage of payments are provided upon Schedule A attached hereto and shall be subject to modification under paragraph 9. Both percentage and number of employees for which CFU shall be reimbursed are subject to yearly adjustment under paragraph 9 hereof. 6. In the event any party or parties to this Agreement take programming or otherwise utilize the IP Video Head End in a manner different from any other party or parties, that non-joint program or utilization will be paid for entirely by the party or parties receiving the separate programing or making the separate utilization. If non-joint program or utilization requires space at CFU head end or property, CFU reserves the right to approve or disapprove said accommodation and additional fees may apply. 7.It is agreed that capital and other financial arrangements and undertaking, shall, except as specifically provided herein, be memorialized by separate agreement of the parties. 8.CFU will administer this Agreement and the operation and maintenance of the IP Video Head End including all existing video infrastructure equipment identified in paragraph 3, which shall be in any event consistent with its past practices in the ordinary course of business, applicable law, and industry standards. CFU will be solely responsible for all decisions regarding maintenance and operation. The cost of all needed replacement or repair parts, including software and software updates, improvements or contracted outside labor fees, and an annual fee (see Schedule A) to recover the salary and benefits expense incurred in calculating and billing each parties' ownership cost will be divided in the same manner as capital contributions as may be provided by separate agreement as provided by paragraph 7 hereof or as subsequently adjusted under paragraph 9 of this Agreement, and paid by all other parties and any new or additional party or parties to CFU upon presentation of an invoice reflecting the proper percentage division of actual cost only, within 30 days. This cost sharing arrangement will be applicable only to the extent the maintenance and operation expenses are necessary for the benefit of all parties to this Agreement. 9.In November of each year, commencing November 2023, all parties to this Agreement shall each designate a representative who shall meet at CFU headquarters or by conference call to review and adjust the allocation of costs and updated technologies applicable -2- under this Agreement. Cost allocations as adjusted will be effective January 1, 2024 and each January 1 after each said meeting thereafter. The reallocation of capital costs incurred after January 1, 2024, and salaries and benefits under paragraphs 5 and 8, and repair and maintenance costs under paragraph 8 hereof or as provided by paragraph 7 hereof will be established as the percentage of properties passed by all parties, and any additional or new party or parties of the prior June as defined in Schedule A. Estimates on Schedule A are informational and not limitations; the distribution formulas in Schedule A are binding on the parties. Schedule A may be amended as a part of the process described in this paragraph. If by ten days after the meeting in November wherein the notification of reallocations is discussed, the parties are unable to agree on reallocations under this paragraph, then they shall mediate all outstanding disputes. Mediation shall commence upon the written notice of any member to all other members. If after notice the parties cannot agree upon a mediator, they shall each select a mediator and the mediators shall mutually select one more person to also act as mediator. If sixty days after appointment of a mediator or mediators the parties have not resolved their dispute or dispute then the parties shall select an arbitrator under Iowa Code chapter 679A, if they are unable to agree on an arbitrator within 30 days, then any party may petition the district court for appointment of an arbitrator. The arbitrator will make a decision within 90 days of selection or appointment. The parties shall accept or reject the decision of the arbitration within ten days of receipt. If the parties accept (or fail to reject) the arbitrator's decision within the time allowed, the decision shall be final and binding upon all parties on all matters in dispute. If any party rejects the arbitrator's decision, then one hundred eighty days thereafter this Agreement shall terminate as provided in paragraph 14. 10.Additional parties may join under this Agreement by adopting its terms with the consent of the governing body of all other members. New members will make an initial contribution to capital based on the percentage of properties passed in the new members' service area compared to the total number of properties passed in the service areas of all participating utilities as defined in Schedule A. New or additional parties may be required to construct at their own expense a fiber link to CFU's designated meet point and provide equipment, appliances or appurtenances necessary to light the fiber link. Any fiber link thus constructed will be lit, managed and monitored by CFU Network Engineers under paragraphs 5 and 8 hereof. Maintenance and repair of each party's fiber will be performed by the respective party. All additional contributions of capital from new members shall be distributed to the pre-existing members as their interests appear. -3- 11.Additional parties may become customers of the shared IP Video Headend. Revenue from these additional parties will be shared among the current members based on their percentage of contributions. 12.No separate legal or administrative entity is created by this Agreement. 13.Parties hereto shall not engage in joint financing, but shall each be separately responsible for financing their costs and expenses under this Agreement. 14.Term of Agreement and Termination Provisions: This Agreement shall be effective on October 11, 2023 and continue in effect until October 11, 2026, and thereafter shall continue for periods of three years unless any party other than CFU provides the others with notice of its intent to terminate, at least 1 year prior to the next termination date, in which event this Agreement shall terminate on the next expiration date. CFU shall give a two-year notice of termination to exit the Agreement regardless of the three-year term of the Agreement, so that CFU may exit the Agreement at any time after a two-year notice period. A.Termination wherein CFU remains a party: If upon any termination date there are more than two parties to this Agreement where one of the remaining parties is CFU and not all parties give notice of termination, any party giving notice of termination will be given, within 180 days of termination, their then share of the depreciated net value of their share of the joint assets as last determined under paragraph 9. B.Termination wherein CFU is not a party: If CFU gives notice of termination, this Agreement will terminate two years after notice is provided pursuant to paragraph 14. Upon CFU providing notice of termination, the remaining existing owners shall have the right of first refusal to purchase the joint assets included in this Agreement with the proceeds from the sale of the assets distributed to the then parties to this Agreement based on their percentage of ownership as it appears on the date of termination as last determined under paragraph 9. C.Termination with no remaining parties: Upon final termination of this Agreement wherein there are no remaining parties to the Agreement, all joint assets shall be liquidated and the proceeds from such liquidation shall be distributed to the then parties to this Agreement based upon their percentage of ownership as it appears on the date of termination as last determined under paragraph 9. CFU shall have the right of first refusal to retain all joint assets in its physical possession upon payment of the proceeds to the other parties in accordance with their percentage of ownership. D.In the event that any member utility, or the assets of any member utility are sold, leased or otherwise transferred, or any member is dissolved or discontinued, the member being sold, leased, otherwise transferred, dissolved or discontinued shall forfeit its share of the net value -4- of any assets as last determined under paragraph 9 above. As to such member, this Agreement terminates upon the date of such member being sold, leased or otherwise transferred, dissolved or discontinued. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed on the day and year set forth below. MUNICIPAL COMMUNICATIONS UTILITY OF THE CITY OF CEDAR FALLS, IOWA Richard McAlister, Board Chair ATTEST: MaraBeth Soneson, Board Secretary Date -5- 10/11/2023 'K_,e(Cey Pe(cfi[e lll61Ul1Y SIGNED 9/8/2023 SCHEDULE A - Fee Structure and Payments Item Fee Structure Estimated Fees Year Notes 1. IP Video Headend Capital Equipment -Includes hardware, licensing, & software A.IPTV CFU 26.68% $973,406 2023 WU 7.17% estimated initial costs* Paid initially at completion CUB 2.09% of 28E Agreement. Additions IMU 9.88% are billed bi-annually. VMCU 3.57% COP 6.96% NHMU 2.36% WLOO 41.29% B. Minerva Middleware CFU 27.26% $201,219 2023 WU 7.32% estimated initial costs* Paid initially at completion CUB 0.00% of 28E Agreement. Additions IMU 10.09% are billed bi-annually. VMCU 3.64% COP 7.11% NHMU 2.41% WLOO 42.17% C.Network DVR CFU 27.26% $158,675 2023 WU 7.32% estimated initial costs* Paid initially at completion CUB 0.00% of 28E Agreement. Additions IMU 10.09% are billed bi-annually. VMCU 3.64% COP 7.11% NHMU 2.41% WLOO 42.17% 2. IP Video Headend Support expenses -Annual support, maintenance, & licensing contracts A.IPTV CFU 26.68% $21,595 2023 WU 7.17% estimated annual cost* Billed bi-annually when invoices CUB 2.09% are paid for the support costs IMU 9.88% VMCU 3.57% COP 6.96% NHMU 2.36% WLOO 41.29% B. Minerva Middleware CFU 27.26% $70,594 2023 WU 7.32% estimated annual cost* Billed bi-annually when invoices CUB 0.00% are paid for the support costs IMU 10.09% VMCU 3.64% COP 7.11% NHMU 2.41% WLOO 42.17% C.Network DVR CFU 27.26% $113,647 2023 WU 7.32% estimated annual cost* Billed bi-annually when invoices CUB 0.00% are paid for the support costs IMU 10.09% VMCU 3.64% COP 7.11% NHMU 2.41% WLOO 42.17% -13- SCHEDULE A (continued) -Fee Structure and Payments 3.IP Video Headend Operational Labor -One headend technician and 21/2 network engineers A.IP1V CFU 26.68% $34,599 2024 WU 7.17% estimated monthly to Billed monthlyfor labor to CUB 2.09% be billed by CFU to operate the IP1V headend IMU 9.88% owners* VMCU 3.57% COP 6.96% NHMU 2.36% WLOO 41.29% 4.Use of existing CFU Owned Video Infrastructure -Dishes, receivers, etc. A.IP1V CFU 26.68% $349,903 2023 WU 7.17% estimated initial fees* Paid initially at completion CUB 2.09% of 28E Agreement. IMU 9.88% VMCU 3.57% COP 6.96% NHMU 2.36% WLOO 41.29% 5.IPTV 28E Cost Allocations and Billing Cost allocation and billing fee CFU 26.68% $900 2023 WU 7.17% monthly fee to Billed monthlyforlabor to CUB 2.09% be billed by CFU to track, allocate and bill 28E costs IMU 9.88% owners* to owners. VMCU 3.57% COP 6.96% NHMU 2.36% WLOO 41.29% 6.Ad Insertion Capital and Expense Costs CFU 27.93% $287,430 2023 Paid initially at completion WU 7.50% estimated initial fees* of 28E Agreement. Additions CUB 0.00% are billed bi-annually. IMU 10.34% VMCU 3.73% $37,324 Billed bi-annually when invoices COP 7.29% estimated annual support are paid for the support costs NHMU 0.00% cost* WLOO 43.21% *Estimated fees and costs listed will be split between owners based on fee structure. The fee structure is based on a properties passed allocation for owners electing those services listed in the schedule. Owners Pro12erties Passed Cedar Falls Utilities CFU 18,869 Waverly Utilities WU 5,068 Communications Utility of Bellevue CUB 1,477 Indianola Municipal Utilities IMU 6,983 Vinton Municipal Communications Utility VMCU 2,521 City of Pella Municipal Telecom. Utility COP 4,924 New Hampton Municipal Com. Utility NHMU 1,668 Waterloo Telecommunications Utility WLOO 29,193 -14- SCHEDULE A (continued) -Fee Structure and Payments Ongoing operation, replacement, maintenance or licensing fees which are not directly allocable to certain parties, but which are associated with the shared IP Video Headend operation, will be allocated among all parties based on each entities% of the combined properties passed. Properties passed shall include all urban and rural properties within an electric service territory for electric utilities and/or within city limits for non-electric utilities taking into account the total potential customer base for the communications utility. Premises that include multiple dwelling units shall be counted by the number of units within the premise. City, utility, college and school properties count as 1 property each. The properties passed al location wi 11 be calculated and adjusted for the next calendar year as described in paragraph 9 of this agreement. There may be certain fees or licenses paid to 3rd parties that are based directly on subscriber counts. Fees/licenses based directly on subscriber counts are not included in Schedule A and will be allocated to the parties based on the subscriber counts. CFU will invoice all owners for the inti al, bi-annual and monthly fees. Initial fees for new owners will be invoiced following signing of this agreement. Operational labor and the cost allocation billing fees will start the month each new owner turns on their first video customer.