SECTION 59.106. Franchise Fee Rates and Charges

(a) Franchise fee rates shall be determined by the executive director or his designee in an equitable and fair manner, giving consideration to the various types of operations, gross receipts, net profit, and capital invested. Single or multiple percentages applied to all or various kinds of gross receipts will be considered in new or amended contracts.

(b) A penalty of 5.0% of the franchise fee due shall be imposed on a leased concessionaire who fails to pay the fee as required under the signed contractual agreement, and if that person fails to pay the fee within 30 days after the day when the fee is sue, an additional 5.0% penalty shall be imposed.

(c) Delinquent fees accrue interest beginning on the 61st day after their due date.

(d) The yearly interest on all delinquent franchise fees is the prime rate plus one per cent, as published in the Wall Street Journal on the first day of the calendar year that is not a Saturday, Sunday or a legal holiday.

(e) The penalties and interest assessed for delinquent franchise fees may not exceed the penalties and interest rate established in the Texas Tax Code §111.060 and §111.061.

(f) Penalties and/or interest under this section may be waived by the executive director for a good cause.

(g) The right to reconsider and renegotiate franchise fees of concession contracts on an annual basis shall be considered standard practice when conditions warrant an adjustment.

(h) The rates and charges prescribed by the concessioner shall be subject to the approval of the executive director or his designee. The reasonableness of the concessioner's rates and charges to the public shall be judged primarily by comparing with current charges for facilities and services of comparable character under similar conditions. Consideration shall be given to:

(1) length of season;

(2) provisions for peakloads;

(3) average percentage of occupancy;

(4) accessibility;

(5) availability and costs of labor and materials;

(6) type of patronage; and

(7) other factors deemed significant as related to the type of concession.

Source Note: The provisions of this §59.106 adopted to be effective January 2, 1997, 21 TexReg 12421; amended to be effective April 23, 2001, 26 TexReg 3024