$/ FOR FCC RECORD ONLY /$ $// MO&O, Cable Act of 1992, DA 95-189//$ $/ 300.623 Regulation of Rates /$ $/ 1.106 Petitions for Reconsideration /$ $/ 76.906 Presumption of no effective competition /$ $/ 76.910 Franchising authority certification /$ $/ 76.911 Petition for reconsideration of certification /$ Before the FEDERAL COMMUNICATIONS COMMISSION Washington, D.C. 20554 In the Matter of: ) DA 95-189 ) TELE-MEDIA COMPANY ) OF MARYLAND ) ) Petition for Reconsideration ) of Certification of ) Cecil County, Maryland (MD0136) ) to Regulate Basic Cable Service Rates ) MEMORANDUM OPINION AND ORDER Adopted: February 8, 1995 ; Released: February 9, 1995 By the Chief, Cable Services Bureau: I. INTRODUCTION 1. On March 22, 1994, Tele-Media Company of Maryland ("Tele-Media") filed a timely petition for reconsideration challenging the certification of Cecil County, Maryland ("Cecil County" or the "County") to regulate rates for basic cable service and associated equipment. On March 31, 1994, the County filed its opposition. On August 19, 1994, the County submitted a supplemental pleading in response to the Commission's July 29, 1994 Order. 2. Section 623(a)(4) of the Communications Act of 1934, as amended, allows franchising authorities to become certified to regulate basic cable service rates of cable operators which are not subject to effective competition as defined in the Communications Act. For purposes of the initial request for certification, local franchising authorities may rely on a presumption that cable operators within their jurisdiction are not subject to such effective competition unless they have actual knowledge to the contrary. Such certification becomes effective 30 days from the date of filing unless the Commission finds that the authority does not meet the statutory certification requirements. Cable operators may file petitions for reconsideration of the franchising authority's certification within 30 days of the date such certification becomes effective. Rate regulation is automatically stayed pending review of a timely filed petition for reconsideration alleging effective competition as defined in the Communications Act. II. DISCUSSION 3. In its petition, Tele-Media argues that its cable system is subject to effective competition as defined in the Communications Act in the unincorporated areas of Cecil County, its franchise area, because it serves fewer than thirty percent of the total number of households. Specifically, Tele-Media claims that it serves 252 of the 20,000 "households" or approximately 1.26 percent of the "households" in the unincorporated areas of Cecil County. 4. In its objection to Tele-Media's petition and its supplemental filing, Cecil County argues that Tele-Media is not subject to effective competition because it has "redefined" its franchise area. Cecil County alleges that Tele-Media has made an affirmative decision to limit its service area to a small portion of Cecil County that is not served by any other cable operator even though its franchise does not restrict service to a specific area within the unincorporated areas of Cecil County. It also claims that Tele-Media does not appear to be planning significant expansion of its service area and, indeed, that Tele-Media "has not appreciably expanded the area it serves beyond the service area it has served since 1981 or shortly thereafter." Thus, Cecil County argues that Tele-Media's showing of effective competition must be based on its "redefined" franchise area. 5. As a preliminary matter, we are not persuaded that the appropriate franchise area for purposes of effective competition is something less than all of the unincorporated areas of Cecil County. Cecil County has presented no evidence indicating that this cable operator, by its own conduct, has made an affirmative decision to restrict service. As the Commission has stated previously, "[t]he fact that a franchise area has not yet been filled out by construction of a system would not by itself be taken as redefining the service area." 6. In the absence of a demonstration to the contrary, cable systems are presumed not to be subject to effective competition. The cable operator bears the burden of rebutting the presumption that effective competition does not exist with evidence that effective competition, as defined by  76.905 of the Commission's rules, is present within the franchise area. Tele-Media did not support its effective competition claim with adequate documentation. Nonetheless, we note that in In the Matter of CECILTON CATV, INC., Petition for Reconsideration of Certification of Cecil County, Maryland, DA # 95-188, (released February 9, 1995), the cable operator serving the same franchise area submitted a copy of the relevant 1990 Census data demonstrating that there are 18,142 households (i.e., occupied housing units) in the unincorporated areas of Cecil County. As both Tele- Media and Cecilton are authorized to serve the same franchise area, we believe that the public interest is served by taking official notice of the household information contained in the Cecilton case. Relying on this household data, we find that Tele-Media serves 252 of the 18,142 households in the franchise area, or 1.38 percent of the total number of households. Accordingly, we find that Tele-Media serving the unincorporated areas of Cecil County is subject to effective competition as defined in the Communications Act. III. ORDERING CLAUSES 6. Accordingly, IT IS ORDERED that the petition for reconsideration filed by Tele-Media Company of Maryland challenging the certification of Cecil County, Maryland to regulate Tele-Media's basic cable rates IS GRANTED. 7. IT IS FURTHER ORDERED that the certification of Cecil County to regulate basic cable service rates of Tele-Media is RESCINDED. 8. This action is taken pursuant to delegated authority under  0.321 of the Commission's rules, 47 C.F.R.  0.321. FEDERAL COMMUNICATIONS COMMISSION Meredith J. Jones Chief, Cable Services Bureau