FOR FCC RECORD ONLY $/ORDER in Fairfax County, VA, et al, DA 95-413/$ $/76.922 Rates for the basic service tier/$ $/76.923 Rates for equipment and installations/$ $/76.944 Commission Review of Franchising Authority Decisions/$ $/1.45 Request for Stay/$ Before the FEDERAL COMMUNICATIONS COMMISSION Washington, D.C. 20554 DA 95-413 In the Matter of ) Fairfax County, VA ) Fairfax, VA MEDIA GENERAL CABLE OF ) Falls Church, VA FAIRFAX COUNTY, INC. ) Herndon, VA ) Vienna, VA Request for Stay ) of Local Cable Rate Ordinances ) CONSOLIDATED ORDER Adopted: March 3, 1995; Released: March 6, 1995 By the Chief, Cable Services Bureau: I. Introduction 1. On February 16, 1995, Media General Cable of Fairfax County, Inc. ("MGC") filed a Request for Stay ("Stay Request") of several cable rate ordinances ("Ordinances") issued by its local franchising authorities in Fairfax County, Va.; the City of Fairfax, Va.; the City of Falls Church, Va.; the Town of Herndon, Va.; and the Town of Vienna, Va (collectively "Communities"). Fairfax County submitted a consolidated Opposition to MGC's Stay Request on February 23, 1995. 2. Fairfax County, which is coordinating its cable rate regulation efforts with the other four Communities, passed an Emergency Ordinance on October 10, 1994. The Communities' Ordinances approved MGC's basic service tier rates, but recalculated and reduced MGC's regulated rates for its equipment and installations, pursuant to the Cable Television Consumer Protection and Competition Act of 1992 ("Cable Act of 1992"). The Ordinances also ordered MGC to issue refunds or credits to subscribers for those charges collected prior to July 14, 1994, which were in excess of MGC's maximum permitted equipment and installation rates. 3. On November 3, 1994, MGC filed an appeal of the Ordinances with the Commission. On the same date, MGC also filed a Request for Stay of the Ordinances pending the Commission's resolution of its Appeal of the Ordinances. In Media General, the Commission denied MGC's Appeal and dismissed its Request for Stay of the Ordinances. 4. In the instant Stay Request, MGC again seeks a stay of those portions of the Ordinances in which the Communities ordered MGC to refund all equipment and installation overcharges prior to July 14, 1994. MGC submits that it satisfies the legal standard for the granting of a stay and is, therefore, entitled to a stay of those portions of the Ordinances pertaining to the issuance of refunds. II. Standard of Review 5. The Commission evaluates petitions for stay under well settled principles. To support a stay, petitioners must demonstrate: (1) that they are likely to prevail on the merits; (2) that they will suffer irreparable harm if a stay is not granted; (3) that other interested parties will not be harmed if the stay is granted; and (4) that the public interest favors the granting of a stay. As discussed below, resolution of this stay petition centers primarily on the strength of MGC's argument regarding the third prong of this test. III. Discussion 6. The Commission's rules permit operators to implement refunds in either of the following methods: (1) by returning overcharges directly to those subscribers who actually paid the overcharges; or (2) by means of a prospective percentage reduction in the rates for the basic service tier or associated equipment for current subscribers via a specifically identified, one-time credit. Thus, the Commission's rules are structured so that individuals who were actually overcharged might not receive refunds in the future. Thus, a delay in the implementation of the refunds owed by MGC will not harm any interested party, since if MGC must implement refunds, it can choose to do so by way of credits to the then-current class of subscribers. In addition, MGC has volunteered to either place in escrow a sufficient amount of funds or to post a bond securing the refund obligation, thus further protecting subscribers interests in the refunds ordered by the Communities. 7. A stay of the Ordinances would prevent MGC from being subjected to the irreparable economic harm of issuing any refunds to subscribers that it could not later recoup. Accordingly, we will grant MGC's Stay Request, pending a review by the Commission of Media General. 8. During the period of this stay, MGC is ordered to deposit in an interest- bearing escrow account the total amount of money that the Communities have ordered MGC to refund to its customers for the period of time between October 10, 1993 and July 14, 1994. Alternatively, MGC may elect to post a bond for the benefit of the Communities. The amount of the bond shall be the total amount of money that the Communities have ordered MGC to refund to its customers for the period of time between October 10, 1993 and July 14, 1994, plus interest on that amount for a twelve (12) month period from the date of this Order. The bond shall provide that if MGC is unable to fulfill its refund obligations for any reason, then the surety will fulfill that obligation to the Communities, on behalf of MGC's subscribers. IV. Ordering Clauses 9. Accordingly, IT IS ORDERED that the Request for Stay filed by MGC is GRANTED. 10. IT IS FURTHER ORDERED that the total amount of money that the Communities have ordered MGC to refund to its customers for the period of time between October 10, 1993 and July 14, 1994 SHALL BE PLACED by MGC in an interest-bearing escrow account, OR SHALL BE SECURED by the posting of a bond for the benefit of the Communities for the total amount of money that the Communities have ordered MGC to refund to its customers for the period of time between October 10, 1993 and July 14, 1994, plus interest on that amount for a twelve (12) month period from the date of this Order. Proof of MGC's compliance with this Consolidated Order shall be filed with the Commission within thirty (30) days of the release of this Consolidated Order. Interest shall accrue, or be computed, at the prevailing U.S. Internal Revenue Service Rate for tax refunds and additional tax payments. 11. This action is taken by the Chief, Cable Services Bureau, pursuant to authority delegated by Section 0.321 of the Commission's rules. 47 C.F.R. 0.321. FEDERAL COMMUNICATIONS COMMISSION Meredith J. Jones Chief, Cable Services Bureau