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4 <br /> 4. FEE PAYMENT 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 telephone business purposes. If this prohibition is removed, Grantee agrees the City will <br /> . assess a reasonable franchise fee in accordance with the City Charter,so long as local,State or <br /> • <br /> 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 are taxable activities subject to the <br /> four and one half percent(4.5%)gross receipts tax rate, as imposed under the City's telephone <br /> business tax, adopted in Everett Municipal Code Chapter 3.28. This provision does not limit the <br /> City's power to amend Everett Municipal Code Chapter 3.28 as may be permitted by law, <br /> including increases to the tax rate. This provision is subject to the exemptions and exceptions <br /> 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 of 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 performed. 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 /> 4.2. Payments <br /> 9 of 30 <br /> 18 <br />