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File how2ftp (.txt & .wp) is in directory \pub\Public_Notices\Miscellaneous. ***************************************************************** ******** $//ORDER Granting Stay in Florence, OR, DA 95-2276//$ $/76.922 Rates for the basic service tier/$ $/76.923 Rates for equipment and installation/$ $/1.45(d) Request for Stay/$ Before the FEDERAL COMMUNICATIONS COMMISSION Washington, D.C. 20554 DA 95-2276 In the Matter of: ) ) Falcon Cable Systems ) ) Petition for Stay of Local Rate Order ) of the City of Florence, Oregon ) ORDER Adopted: November 1, 1995 Released: November 13, 1995 By the Chief, Cable Services Bureau: I. INTRODUCTION 1. On September 6, 1995, Falcon Cable Systems ("Falcon") filed a request for an emergency stay of the local rate order of the City of Florence, Oregon ("City") pending resolution of Falcon's appeal of the local rate order. Falcon also filed its appeal on September 6, 1995. The local rate order was issued by the City on August 9, 1995. 2. The City's local rate order addresses the rates Falcon charged for basic cable service, associated equipment and installations. The rate order also provides for a refund retroactive to September 1, 1994. In the City's rate proceedings, Falcon elected to use a cost of service filing to justify its rates. 3. The City conducted a review of Falcon's cost of service submission and issued an order in which it disallowed the inclusion of Falcon's intangible assets. The City ordered Falcon to reduce its rates and refund to subscribers the overcharges levied since September 1, 1994. Falcon states that the City's local rate order would require Falcon to refund $280,000 for the period of time dating back to September 1, 1994. Falcon also asserts that implementation of the City's rate order will result in revenue losses for the operator of approximately $24,000 per month. Falcon seeks a stay of the local rate order pending the resolution of its appeal on the merits. The City does not oppose Falcon's petition for stay. 4. The Commission evaluates petitions for stay under well-settled principles. To support a stay, a petitioner must demonstrate: (1) that it is likely to prevail on the merits; (2) that it 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 Falcon's argument regarding the second and third prong of this test. II. DISCUSSION 5. With regard to the matter of harm to other parties, a delay in the implementation of the refunds owed by Falcon will not harm any interested party, because under our rules, Falcon can choose to issue refunds by crediting current subscribers. 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. A stay of the local rate order will not alter Falcon's right under our rules to choose the class of subscribers to receive refunds. 6. With regard to the matter of irreparable harm to Falcon, a stay of the local rate order would ensure that Falcon is not subjected to the irreparable economic harm it could face if it had to issue refunds it could not later recoup. Accordingly, given our findings herein, and the fact that the City does not oppose Falcon's petition for stay, we will grant Falcon's request that the City's local rate order be stayed pending our full review of this case on the merits. 7. As we have concluded in several previous requests for stays of local rate orders, we find in this case that the escrow account or bond-posting condition is necessary to protect the interest of subscribers and to ensure that the refunds will be paid if Falcon does not prevail on appeal. During the period of this stay, Falcon must deposit in an interest- bearing escrow account the total amount of money that the City has ordered Falcon to refund to its customers. Alternatively, Falcon may elect to post a bond for the benefit of the City. The amount of the bond shall be the total amount of money that the City has ordered Falcon to refund to its customers, plus interest on that amount for a 12 month period from the date of this Order. The bond shall provide that if Falcon is unable to fulfill its refund obligations for any reason, then the surety will fulfill that obligation to the City, on behalf of Falcon's subscribers. III. ORDERING CLAUSES 8. Accordingly, IT IS ORDERED that the emergency request for stay filed by Falcon is GRANTED pending the resolution of Falcon's appeal on the merits. 9. IT IS FURTHER ORDERED that the total amount of money that the City has ordered Falcon to refund to its customers SHALL BE PLACED by Falcon in an interest- bearing escrow account, OR SHALL BE SECURED by the posting of a bond for the benefit of the City for the total amount of money that the City has ordered Falcon to refund to its customers, plus interest on that amount for a 12 month period from the date of this Order. Proof of Falcon's compliance with this Order shall be filed with the Commission within 30 days of the release of this Order. Interest shall accrue, or be computed, at the prevailing U.S. Internal Revenue Service Rate for tax refunds and additional tax payments. 10. 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