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2 <br /> 4. FEE PAY,; ENT AND FINANCIAL CONTROLS <br /> 4.1. Fees <br /> 4.1.1. FRANCHISE FEE <br /> Notwithstanding the provisions of Section 13.8 of the City Charter,the parties understand that <br /> RCW 35.21.860 currently prohibits a municipal franchise fee for permission to use the right of <br /> way for service providers, including for telephone business purposes. Based on the <br /> representations of Grantee, it is the City's understanding that Grantee will use the right of way <br /> for telephone business purposes as defined by RCW 82.16.010. If this prohibition is removed or <br /> does not apply, Grantee agrees the City will assess a reasonable franchise fee in accordance with <br /> the City Charter, so long as local, State or federal law does not otherwise prohibit such fee. <br /> 4.1.2. UTILITY TAX <br /> The parties further understand that RCW 35.21.870 currently limits the rate of City tax upon <br /> telephone business activities to six percent(6%) of Gross Receipts,unless a higher rate is <br /> approved by vote of the people. The parties agree,however,that nothing in this Franchise shall <br /> limit the City's power of taxation, as now or may hereafter exist. Grantee stipulates that all of its <br /> business activities in the City of Everett as identified herein that are a telephone business shall be <br /> specifically taxable as a telephone business at six percent(6.0%) gross receipts tax rate, as <br /> imposed under the City's telephone business tax, adopted in Everett Municipal Code Chapter <br /> 3.28. This provision does not limit the City's power to amend Everett Municipal Code Chapter <br /> 3.28 as maybe permitted by law, including increases to the tax rate. This provision is subject to <br /> the exemptions and exceptions identified in Everett Municipal Code §3.28.055. <br /> 4.1.3. PERMIT AND ADMINISTRATIVE FEES <br /> City shall charge, and Grantee shall pay,permit fees according to the schedule of permit fees in <br /> existence at the time Grantee applies for each Right-of-Way permit provided that such fees are <br /> reasonably related to City's costs. The rate charged shall be that rate that the City in good faith <br /> determines most closely matches the work to be perfoiuied. By way of example only and not <br /> limitation, Grantee would be charged the rate for trenching where Grantee intends to install <br /> conduit by directional drilling or boring. Where the City incurs reasonable costs and expenses <br /> for which a fee is not established,including but not limited to attorneys, consultants, City Staff <br /> and City Attorney's Office, in connection with the preparation,review, approval, and <br /> enforcement of this Franchise, or review,inspection, or supervision of activities undertaken <br /> through the authority granted in this Franchise or any ordinances relating to the subject, the <br /> Grantee shall reimburse the City directly for any and all costs after receiving an invoice <br /> documenting said costs and expenses in sufficient detail to demonstrate that they were reasonably <br /> necessary to perform the aforementioned actions. The time of City employees shall be charged at <br /> their respective rate of salary, including overtime if applicable,plus benefits and overhead. Any <br /> other costs will be billed proportionately on an actual cost basis. <br /> 9 A <br />