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FCC Record Only
//$Order, Initiating Cost Study, DA 95-2042//$
/$76.922, Rates for Basic Service Tier and CPST/$


                                Before the
                     FEDERAL COMMUNICATIONS COMMISSION
                          Washington, D.C.  20554
                                                                 DA 95-2042

In the Matter of                        )
                                   )
Implementation of Sections of the            )    
Cable Television Consumer Protection         )    MM Docket No. 92-266
and Competition Act of 1992: Rate Regulation )    
                                   )


                                   ORDER

     Adopted:  September 27, 1995            Released:  September 29, 1995

By the Chief, Cable Services Bureau

Responses Due: November 30, 1995

     1.   In the Second Order on Reconsideration, Fourth Report and Order and Fifth
Notice of Proposed Rulemaking ("Second Reconsideration Order"), 9 FCC Rcd 4119 (1994),
the Commission promulgated rules implementing benchmark regulation of both basic and
cable programming service rates of cable systems not subject to effective competition.  The
Second Reconsideration Order revised the average competitive differential between rates
charged by competitive and noncompetitive systems and integrated this differential into the
benchmark.

     2.   Generally, under the Second Reconsideration Order, systems not subject to
effective competition were required to reduce their regulated rates by the full competitive
differential.  The Order also provided, however, that particular systems would be eligible for
"transition" relief from the impact of the full reduction.  Specifically, the Second
Reconsideration Order provided that "low-price" systems would not be required to implement
full reductions pending a Commission review of industry costs.  Low-price systems were 

required only to reduce rate levels to, but not below, the revised benchmark during the
transition period.  Transition relief would terminate upon completion of an industry cost
survey.  In no case, however, would transition relief systems, upon termination of the
transition period, be required to reduce their rates more than the competitive differential.

     3.   Pursuant to the Second Reconsideration Order, the industry cost survey is
needed to determine whether and to what extent low-price systems should be required to
provide rate reductions.  Accordingly, in this Order, we adopt the cost survey to implement
this aspect of our regulatory approach.

     4.   The survey will be sent to 660 of the 2,271 cable systems that do not qualify
for special regulatory treatment provided in the Eleventh Reconsideration Order.  The
questionnaire asks for information regarding primary system costs and operations, including
plant costs, intangibles, revenues, operating expenses, and capitalization.  The survey should
be completed by a company official familiar with the services offered by the cable system
and its associated costs and revenues.  Specific survey instructions are set forth in
information accompanying the survey form.  Entities receiving the questionnaire must file
their responses with the Commission no later than 60 days from the mailing of the survey. 
Responses should be mailed to the Cable Services Bureau, ATTN: Cost Survey, Federal
Communications Commission, 1919 M Street, N.W., Washington, D.C. 20554.

     5.   We have designed the survey form to limit administrative burdens associated
with the cost survey while ensuring that we receive sufficient data to accomplish its
regulatory purpose.  We understand that completion of the survey will entail some additional
effort on the part of responding operators, but the survey form has been tailored with the
specific objective of minimizing the time commitment necessary to complete the form's
inquiries. 

     6.   We recognize that some of the data requested in the survey may be sensitive
and that responding operators may be reluctant to provide such data without reasonable
assurances of confidentiality.  We note here, however, that the information provided in
response to the survey will not be made available on an individual operator basis.  The data
received from all responses will be analyzed and aggregated to determine whether low-price
systems should be subject to further rate reductions as explained in the Second
Reconsideration Order.  Information provided by operators in response to the survey will not
be routinely available for public inspection.  The Commission will withhold submitted
information from public inspection if the operator makes a showing for nondisclosure as
provided in 47 C.F.R.  0.457.

     7.   Accordingly, IT IS ORDERED, pursuant to Sections 4(i) and 623 of the
Communications Act of 1934, as amended, 47 U.S.C.  154(i) and 543, the cable systems
subject to the cost survey requirements described herein shall complete and return the
questionnaire set forth in the attached Appendix A by the date set forth at the top of this
Order.

                         FEDERAL COMMUNICATIONS COMMISSION




                         Meredith J. Jones
                         Chief, Cable Services Bureau