HomeMy WebLinkAboutMINUTES - 04191994 - IO.2 TO: BOARD OF SUPERVISORS I .O.-2
- f Contra
Costa
FROM: INTERNAL OPERATIONS COMMITTEE
County
DATE:
March 28/ 1994 rr=
SUBJECT: RECOMMENDATION FOR AN AMENDMENT TO THE CABLE TELEVISION
ORDINANCE TO PERMIT BASIC CABLE TELEVISION RATE REGULATION AND
AUTHORIZATION FOR AN AUDIT OF TCI 's FRANCHISE FEES AND RATES
SPECIFIC REQUEST(S)OR RECOMMENDATION(S)&BACKGROUND AND JUSTIFICATION
RECOMMENDATIONS: ;
1 . INTRODUCE, WAIVE reading and FIX April 26 , 1994 for adoption
o,f an amendment to the County Cable Television Ordinances No.
82-28 and No. 93-55, implementing the local regulation of
cable television rates for the basic service tier and
associated equipment, as is provided for in federal law and
regulations .
2 . AUTHORIZE the Cable TV Franchise Administrator to join with
the cities served by TCI to accept the franchise fee audit
proposal from Crow-Chisek; AUTHORIZE payment of the County' s
portion of the audit expenses, not to exceed $10,000; and
AUTHORIZE the County Administrator to sign the attached
Memorandum of Understanding to implement the franchise fee
audit.
BACKGROUND:
The Board of Supervisors has adopted a new Cable TV Ordinance which
regulates the Cable TV franchises in the unincorporated area of the
County. It is necessary to amend the Cable TV Ordinance, as is
outlined in the attached report from Pat Burke, the Cable TV
Franchise Administrator, in order to permit the County to regulate
cable television rates for the basic service tier and associated
equipment.
CONTINUED ON ATTACHMENT: YES SIGNATURE:
RECOMMENDATION F COUNA IMINISTRATOR RECOMMENDATION OF BOARD COMMITTEE
APPROVE TH R
SIGNATURE(S):
ACTION OF BOARD ON APPROVED AS RECOMMENDED _X OTHER
i 1994
VOTE OF SUPERVISORS
I HEREBY CERTIFY THAT THIS IS A TRUE
UNANIMOUS(ABSENT ) AND CORRECT COPY OF AN ACTION TAKEN
AYES: NOES: AND ENTERED ON THE MINUTES OF THE BOARD
ABSENT: ABSTAIN: OF SUPERVISORS ON THE DATE SHOWN.�J
ATTESTED
Contact: PHIL BATCH LOR.CLERK OF THE BOARD OF
cc. County Administrator SUPERVISORS AND COUNTY ADMINISTRATOR
Cable TV' Franchise Administrator
County Counsel
BY DEPUTY
I .O.-2
On November 9, 1993, the Board of Supervisors authorized staff to
join with the cities served by TCI to request proposals from firms
qualified to audit TCI ' s franchise fees and review their rate
proposal . The Cable Coordinators from the County and the cities
served by TCI have recommended the proposal submitted by Crow,
Chisek. The County' s share of the audit would be $10,000, although
it might be a little more if additional services are requested by
the County, such as attendance at Board meetings to discuss and
explain the findings of the audit. The County's share of these
expenses can be paid for from the Community Access Trust Fund. Any
additional franchise fees recovered as a result of the audit will
be used first to reimburse the Community Access Trust Fund and then
divided as previously authorized, with 60% going to the County
General Fund and 40% going to the Community Access Trust Fund.
On March 28, 1994 our Committee met with our Cable TV Franchise
Administrator, Pat Burke and representatives from Concord TV Cable
and Viacom. There are two issues regarding the proposed amendment
to the Cable TV Ordinance. As submitted to our Committee, the
Ordinance would provide that if the County were to rule a basic
rate improper and order a roll-back in the rate and the cable
company failed to comply with the County' s order and instead
appealed the County' s decision to the Federal Communication
Commission (FCC) , the County could impose a fine of up to $100 a
day. The cable operators asked that the County not be entitled to
impose a fine until the FCC rules on an appeal . In this case, the
County would recover no money for the period of time the appeal is
pending, which could well be months .
We have taken a middle ground and directed staff to revise the
amendment to the Cable Television Ordinances to provide that the
County could impose the fine immediately. If the cable operator
appeals the County' s decision, the fine would be suspended until
the FCC rules on the appeal . If the County wins the appeal, the
fine would then be due retroactive to the time it was imposed. If
the cable operator wins the appeal, the fine would be waived by the
County. The Ordinance before you, therefore, reflects this middle
ground suggested by our Committee.
The other issue raised by the cable operators involves the
possibility that the federal government may, at some time in the
future, allow local governments to regulate more of the cable TV
business than just the basic rates and associated equipment. Under
the existing Cable TV Ordinance, the County has the right to
regulate all charges to the subscriber for programming, equipment,
installation, disconnection, reconnection, additional outlets and
other programming products or services, except as expressly
prohibited by the state or federal government.
Under current federal law, the County is expressly prohibited from
regulating any of these rates except for the basic service tier.
However, if this authority were expanded in the future, the County
would acquire the authority to regulate additional rates and
services without further action by the Board of Supervisors . The
cable operators want the Board to have to specifically take action
to provide for that additional regulation. Our Committee is not
prepared to recommend that the existing Cable TV Ordinance be
amended to provide for this additional review in case of a change
in federal law at some time in the future.
Page 2
OFFICE OF THE COUNTY ADMINISTRATOR
CONTRA COSTA COUNTY
Contra Costa Television Division
(510) 646-2948 or (510) 313-1180 acetv
Administration Building
651 Pine Street, 11th Floor
Martinez, California 94553
TO: Internal Operations Committee
FROM: Patricia Burke', Franchise Administrator
DATE: March 21, 1994
SUBJECT: REPORT OF CABLE TELEVISION RATE REGULATION
AMENDMENT AND CONTRA COSTA TELEVISION
Rate Regulation Amendment
As a result of 1993 Federal Cable Television legislation,local jurisdictions were given the authority
to regulate basic tier cable television rates and equipment and installation rates associated with that
tier. Contra Costa County applied for and received certification to regulate basic tier cable television
rates for all cable systems not subject to "effective competition".
However,before rate review can begin,the County must adopt rate regulation procedures consistent
with FCC guidelines. The attached amendment to the County's Cable Television Ordinance
establishes those procedures. This amendment has been sent to all cable operators for their review
and comment.
Upon adoption of this amendment,staff will notify all regulated cable operators that we are certified
and send them a copy of the adopted amendment. The cable operators'are then required to submit
a copy of their FCC 393 form or a cost-of-service showing for their basic tier cable television rates to
the County for review. After receipt of the above information, the procedures outlined in the
amendment will be followed.
TCI Franchise Fee and Rate Review Audit
On November 9, 1993, the Board authorized staff to join with cities served by TCI to request
proposals from firms qualified to audit TCI's franchise fees and review their rate proposal. The cities
involved carefully reviewed the three returned proposals from the twenty requests for proposal sent.
Lafayette, Orinda, Martinez and Walnut Creek have asked their councils to authorize funds to
conduct both audits. Brentwood,Pleasant Hill and Moraga will be asking their cities for funding in
the next two weeks.
- 1 -
Due to recent revisions of the Rate Regulations by the Federal Communications Commission(FCC),
TCI cities have agreed that the rate audit should wait until the rules are published and they have
had an opportunity to review them. (There is a workshop sponsored by the FCC to discuss the 1993
Cable Act and changes on April 13, 1994 which staff and other city cable regulators will attend.)
However, all cities represented agreed that they wanted to proceed with the franchise fee audit.
The County has not done an independent audit of TCI's franchise fees since 1985. At that time, a
discrepancy was discovered and back franchise fees were recovered. A recent audit of Concord TV
Cable indicated the omission of some revenue that may yield the City five percent more in franchise
fees than those paid. This same revenue may not be included in TCI's payment to us. Since TCI's
revenue documentation is sketchy, it is difficult to determine if these revenues are included.
Cable Ordinance No.82-28 authorizes the County to audit three previous years of franchise fees. The
Cable Coordinators selected from Crow, Chisek from the proposals received because of their
experience with local government franchise audit and their competitive bid. Contra Costa County's
portion of the costs for a franchise fee audit would be approximately$10,000. If the Board requests
additional services, such as the consultant's attendance at Board meetings, there may be some
additional costs. This cost is less than two percent of the total franchise fees that Contra Costa
County receives in one year from TCI. Thus if TCI has under-reported by two percent or more, the
audit will pay for itself. Moneys from the Community Access Trust Fund could be used and
reimbursed if additional franchise fees are collected.
Contra Costa Television
In August 1993, the Board of Supervisors adopted the revised Cable Television Ordinance and
approved the"Agreement for the Delivery ofAccess Programming in Contra Costa County". As part
of that agreement, the cable operators were required to provide the County with a dedicated,
interconnect channel and equipment.
The dedicated channel will be activated on six cable systems by June 1, 1994. The path from Volmer
Peak to Watson Tower needs to be completed to connect Viacom, Pittsburg and Bay Cablevision to
the interconnect. County Lease Management staff is talking with Watson Tower owner and East
Bay Regional Park District to determine the most cost effective way to incorporate these systems.
Viacom,Pinole and Antioch,will need to complete their rebuilds to have a channel available. They
should be on line by June 1, 1994.
Until they are on line, Viacom has agreed to continue to duplicate, distribute and air the County
programming that includes Board meeting excerpts and the "Most Wanted Deadbeat Parents" on
their two systems' community television channels at their expense.
The cable operators were asked to designate one or two channel numbers for the County channel.
They have offered the following:
Bay Cablevision,Ch. 18;Century,Ch. 19;Concord TV,Ch. 18;Ponderosa Cable Systems,Ch.27,TCI
of Contra Costa,Ch. 19,TCI of Brentwood,Ch. 19, TCI of Walnut Creek,Ch. 19,Viacom-Pittsburg,
Ch. 27 and Viacom-Pinole, Ch. 27.
- 2 -
The three channels suggested for use are Channels 18, 19 and 27. Initially, Channel 18 was the
channel most systems had agreed to dedicate. As a result of "most carry provisions" and re-
transmission consent, some systems were not able to dedicate this channel.
Viacom agreed to move to channel 18 or 19 when one of them becomes available. (Note: Existing
contracts expire in three years with program providers currently on those channels.)
In accordance with the Agreement with the County, all operators were asked to make "reasonable
efforts"to agree to one and no more than two channel assignments. It is my understanding that the
operators believe they have done this and as a result of Federal legislation, are still unable to give
us fewer than three channels.
At this point, the Board has two options:
1) Based on the 10/1/93 date that Viacom signed agreements with the two program providers to
use Channels 18 and 19 which were the two channels considered for the interconnect, the
Board could decide that Viacom did not make reasonable efforts to agree on one and no more
than two channel numbers. In which case, Viacom would be in breach of the contract and
appropriate actions could be taken, following the opportunity to cure; or
2) The Board may ask the cable operators to agree to publicize Contra Costa television on their
channel line-up cards and in newspaper or TV Guides to which they provide channel
information. By assisting us with the promotion of Channel identification, the use of three
channels, although not ideal, may not be a significant barrier to CCTV's success.
CONCLUSION
In conclusion, staff would ask that the Internal Operations Committee:
1) Introduce the amendment to the Cable Television Ordinances No. 82-28 and 93-55 to
include provisions for enforcement of federal rate regulations for basic service.
Waive reading and Fix adoption for April 19, 1994;
2) Authorize the Franchise Administrator to join with cities served by TCI to accept the
franchise fee audit proposal from Crow-Chisek and pay for the County's portion of the
audit not to exceed $10,000;
3) Direct the Franchise Administrator to proceed with Option 1 or 2 for the Interconnected
County Channel; and
4) Adopt the "Operating Policy and Procedures" for Contra Costa Television (CCTV).
- 3 -
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CONTRA'COSTA COUN
RECEIVED
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March 18, 1994
MAR 7 3199 .
Ms. Patricia Burke OFFICE OF
Franchise Administrator COUNTY-ADMINISTRATOR
Contra Costa County
County Administration Building
651 Pine Street, 11th Floor
Martinez,California 94553-1229
Dear Ms. Burke:
In response to our phone conversation yesterday,I am writing to clarify our proposal and its prices.
We will hold our fees to the amounts stated in our proposal for calendar 1994. Our fees for the
franchise fee revenue agreed-upon procedures are as stated on page 15 of our proposal dated
December 15, 1993.
Our fees for the the agreed-upon procedures to be performed on the FCC Form 393 filings will be as
stated on page 16 of the same proposal.
As we discussed, these two items are in essence separate tasks and do not need LLI be performed
concurrently. If the Consortium would like us to begin work on one project in the near future and
defer work on the other project until a later date, this will not increase fees on the!second project.
If you have any other questions or need further clarifications, please feel free to contact us.
Cordially,
C' __, rte_'
Louis G. Karrison
Partner
ONE MID AMERICA PLAZA 11C)STOFFICE BOX 3697 OAK BROOK,ILLINOIS 00522-3697 708.574.7878 FAX 708.57,1.1608 A Mombor of I for,-ath Interne Donal
MEMORANDUM OF UNDERSTANDING BETWEEN THE COUNTY OF
CONTRA COSTA AND TCI-FRANCHISE CITIES IN
CONTRA COSTA FOR AUDIT OF CABLE TELEVISION
This memorandum of understanding("MOU")is made and entered into between the County
of Contra Costa, a separate political subdivision of the State of California (hereinafter
"County") and the City of Brentwood, Town of Danville, City of Lafayette, City of Martinez,
Town of Moraga, City of Orinda, City of Pleasant Hill,and City of Walnut Creek, all separate
political subdivisions of the State of California(each city hereinafter referred to as "City")on
the day of , 1994.
RECITALS
A. Both County and City desire to conduct a multi jurisdictional audit of their
respective cable television franchises in the area of franchisee fees.
B. City desires to utilize the County for the purpose of managing the cable
television multi jurisdictional auditing contract(s) and for billing purposes.
C. County desires to coordinate, manage, and facilitate billing of the cable
television multi jurisdictional auditing contract(s) for the City.
D. County and City enter into this MOU to define their respective obligations
hereunder.
ARTICLE 1: GENERAL PROVISIONS
1.1 Services. County shall provide the services described in Article 2 below and
on the terms and conditions hereinafter set forth, and City shall provide the services
described in Article 3 below and on the terms and conditions hereinafter set forth.
1.2 City Authority. It is acknowledged and agreed that City presently has the
exclusive franchise authority over cable operations within its jurisdiction; however, the City
may delegate such authority as it may have for conducting a multi jurisdictional audit of
cable television franchise fees to another agency or firm.
1.3 City Delegation of Authority. The City hereby authorizes the County to
coordinate a multi jurisdictional audit of the cable television franchisee,and provide direction
to the firm contracting with the County for cable television multi jurisdictional auditing
purposes.
1.4 Independent Contractor. It is acknowledged and agreed that County's
relationship to City pursuant to this MOU is one of an independent contractor and County
is not, and shall not be deemed, an employee of City for any purposes, nor shall County
employees or consultants be deemed employees of the City. It is acknowledged that the
County and City share a unique and mutually beneficial relationship which shall be reflected
in the cooperative efforts of involved project staff.
MOU: Page 1 of 3
ARTICLE 2: SCOPE OF COUNTY SERVICES
2.1 Contracting with Auditing Firm. County shall contract with an auditing firm to
conduct a multi jurisdictional franchise fee audit of City's cable television franchisee. The
contract shall be subject to the approval of the City Manager or his/her designee.
2.2 Billin . County shall bill each City for its proportionate share of the total cost of
the multi jurisdictional cable television audit, as charged by the auditing firm. Total cost
shall not exceed $70,000. City shall make payment no later than thirty days after billing.
2.3 Coordination of Services. In order to ensure that auditing services are
coordinated, County staff shall be available to meet and confer jointly with City staff on an
as-needed basis. The purpose of the meetings will be to provide opportunity for multi-
jurisdictional information sharing and exchanging of technical expertise.
ARTICLE 3: SCOPE OF CITY SERVICES
3.1 Proportional Cost. City shall reimburse County for City's proportion of the multi-
jurisdictional cable television audit pursuant to the provisions of section 2.2, above. City's
proportional cost of said audit shall not exceed the percentage of cable subscribers in the City
to all cable subscribers represented by all franchise areas participating in the multi-
jurisdictional audit in accordance with the number of TCI subscribers in each participating
City and the County as of January 1, 1994. Should any City or Cities and/or the County
request additional service beyond the scope of work as contracted per section 2.1, such party
shall pay all additional costs associated with such request.
3.2 Provision of Information and Materials. City shall provide County information
and materials specific to its jurisdiction relating to the carrying out of this MOU and shall
provide such assistance as may be reasonably necessary.
3.3 Coordination of Services. In order to ensure that auditing services are
coordinated, City staff shall be available to meet and confer jointly with County staff on an
as-needed basis. The purpose of the meetings will be to provide opportunity for multi-
jurisdictional information sharing and exchanging of technical expertise.
ARTICLE 4: AGREEMENT EFFECTIVE DATE AND TERMINATION
4.1 Effective Date. This MOU shall be deemed effective as to the City upon execution
by County and City and shall remain in full force until completion of the auditing contract
referenced in section 2.1, above.
ARTICLE 5: ALLOCATION OF LIABILITY
5.1 Allocation of Liability. City and County agree that as to any liabilities, each
entity shall be responsible for any joint liability on the basis of proportionate fault of each
entity which is party hereto.
ARTICLE 6: AMENDMENTS
MDU: Page 2 of 3
6.1 Written Approval Required. Any amendments to this MOU must be
approved in writing by all signature parties hereto.
COUNTY OF CONTRA COSTA
By Date
Phil Batchelor, County Administrator
C I TY
By Date
City Manager, City of Brentwood
By Date
Town Manager, Town of Danville
By Date
City Manager, City of Lafayette
By Date
City Manager, City of Martinez
By Date
City Manager, City of Moraga
By Date
City Manager, City of Orinda
By Date
City Manager, City of Pleasant Hill
By Date
City Manager, City of Walnut Creek
MOU: Page 3 of 3
I
ORDINANCE NO. 94-
(Enforcement of Federal Cable Rate Regulations)
The Contra Costa County Board of Supervisors ordains as follows
(omitting the parenthetical footnotes from the official text of the
enacted or amended provisions of the County Ordinance Code) :
SECTION I. SUMMARY. This ordinance implements the local
regulation of cable television rates for the basic service tier and
associated equipment, as provided in the Federal Cable Television
Consumer Protection and Competition Act of 1992 and the regulations
adopted by the Federal Communications Commission (47 CFR, Part 76,
Subpart N) .
SECTION II. Section 58-8.009 is added to the County Ordinance
Code to read:
58-8 . 009 Regulation of Rates for Basic Service Tier and
Associated Equipment. (a) Authority. The Cable Television
Consumer Protection and Competition Act of 1992 (the Act) and the
related regulations adopted by the FCC establish regulations
limiting rates .for basic cable television service. Local
franchising agencies are authorized to enforce these regulations if
the agency is certified by the FCC to enforce the regulations. The
effectiveness of this section is subject to the certification of
the county by the FCC or any other authority which may be conferred
upon the county by the federal government. The county hereby
adopts by reference the rate regulations established by the FCC
pursuant to the Act together with any amendments which may occur
from time to time. The provisions of this section are intended to
implement the rate regulations established by the FCC and shall not
be deemed to limit the authority of the county in any way.
(b) Initial Basic Cable Service Rates. If the county is
certified by the FCC to enforce rate regulations, the county
administrator or designee shall notify each grantee of the
certification. Within thirty days after receipt of the notice, the
grantee shall file its schedule of existing rates for the basic
service tier and associated equipment with the board together with
a completed FCC Form 393 (or such other form for the determination
of initial rates as may be issued by the FCC) or cost-of-service
study as the case may be, and any other information required by the
county administrator or designee consistent with FCC rules or
regulations.
(c) Rate Increases. Prior to increasing existing rates or
establishing new rates for basic service and/or associated
equipment at any time, the grantee shall file its proposed rates
with the county administrator or designee together with a completed
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ORDINANCE NO. 94-
FCC Form 393 (or such other form for the determination of rate
increases or new rates as may be issued by the FCC or the county)
or cost-of-service study as the case may be, and any other
information required by the county administrator or designee
consistent with FCC rules or regulations.
(d) Extensions of Time for Action. The existing rates
shall remain in effect and proposed rates shall take effect thirty
days after submission of the forms and information specified in
subsection (b) or (c) above, unless the board disapproves the rate
or issues an order extending the 30-day period as follows. The
board may issue a written order extending this 30-day period for:
(a) an additional ninety days in cases not involving cost-of-
service showings if the board is unable to make a determination
within the 30-day period; or (b) an additional one hundred fifty
days in cases involving cost-of-service showings.
(e) Hearing and Decision. If all required materials are
not submitted, the proposed rates shall not go into effect. If all
required materials are submitted, a hearing on the existing or
proposed rates shall be scheduled before the board. The grantee
and the general public shall be given an opportunity to be heard at
the hearing. The grantee shall have the burden of proof to
establish that its existing or proposed rates are within the limits
established by the FCC regulations. The board shall issue a
written decision if it approves over opposition or disapproves the
existing or proposed rates in whole or in part. The board is not
required to issue a written decision if it approves an existing or
proposed rate which has not been opposed by any person or if it
takes no action, in which event the proposed rate shall take effect
upon expiration of the time period prescribed in subsection (d)
above. If the board determines that the rates are unreasonable and
do not comply with FCC regulations, the board may prescribe
reasonable rates as authorized by FCC regulations. If the board
determines that the grantee's existing rates exceed the amounts
permitted by FCC regulations, the board may order the grantee to
refund the amounts overcharged to its subscribers to the extent
permitted by the FCC regulations, provided that the county shall
have given the grantee notice of the refund and the opportunity for
comment concerning the proposed refund before any such refund is
required.
(f) Refunds to Customers. Within ninety days from the
board's issuance of a rate decision or refund order, any refunds
owing by the grantee to customers shall be returned through direct
payment to the customer or a specifically identified credit on the
customer's bill, or shall be implemented by means of a prospective
rate reduction, as provided in 47 CFR Section 76.942 (d) .
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ORDINANCE NO. 94-
(g) Enforcement. If the grantee fails to comply with a rate
decision or refund order made pursuant to this section, the county
shall have the right to exercise any of the remedies set forth in
Chapter 58-16. However, in the event that the grantee appeals a
rate decision or refund order, as provided in 47 CFR Section
76.944 , the collection of any liquidated damages assessed by the
county shall be stayed pending the resolution of such appeal. If
the rate decision or refund order is reversed on appeal, the
liquidated damages shall be waived. Otherwise, the liquidated
damages shall be payable for the period from the date of assessment
to the date on which the grantee fully complies with the rate
decision or refund order.
(h) Complaints Concerning Cable Programming Services
Rates. The county administrator or designee is authorized to
file a complaint with the FCC challenging the reasonableness of a
grantee's rate for cable programming services, or for the
installation or rental of equipment used for the receipt of such
cable service, at any time that the county administrator or
designee determines such a complaint may be warranted. (Ord. 94-
S 2) .
SECTION III. Subsection (a) of Section 58-8.008 is amended to
read:
(a) Except as expressly prohibited by state or federal
statute or regulation, the county shall have the right to regulate
all rates charged by the grantee to subscribers for programming,
equipment, installation, disconnection, reconnection, additional
outlets and other programming products or services. To implement
such rate regulation, the following provisions of this section
shall govern rates and rate changes under this division, except for
rates and rate changes for the basic service tier and associated
equipment, which shall be governed by the provisions of Section 58-
8.009. (Ords. 94- S 3, 93-55 S 1) .
SECTION IV. The following language is added to Subsection (c) of
Section 58-16. 002 :
(7) For failure to comply with a rate decision or refund
order made pursuant to Section 58-8.009, the grantee shall pay
$100. 00 per day or part thereof that such violation continues.
(Ords. 94- S 4, 93-55 S 1) .
SECTION V. EFFECTIVE DATE. This ordinance becomes effective
thirty days after passage, and within fifteen days of passage shall
be published once with the names of the Supervisors voting for and
against it in the Contra Costa Times, a newspaper published in this
county.
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ORDINANCE NO. 94-
PASSED on April , 1994 by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
ATTEST: Phil Batchelor, Clerk
of the Board of Supervisors and
County Administrator
By: Chairman of the Board
Deputy
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ORDINANCE NO. 94-