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$//Appeal ORDER Century Cable of Southern California, DA 95-2460/$
$/76.922 Rates for the basic service tier/$
$/76.923 Rates for equipment and installation/$
$/76.936 Written decision/$
$/76.937 Burden of proof/$
$/76.944 Commission Review of Franchising Authority Decisions/$
                                    
                                    
                               Before the
                    FEDERAL COMMUNICATIONS COMMISSION
                         Washington, D.C. 20554
                                    
                                    
     DA 95-2460

In the Matter of:     )
     )
CENTURY CABLE OF      )
SOUTHERN CALIFORNIA   )
     )
Appeal of Local Rate Order       )
of City of      )
Redondo Beach, California        )

                                   ORDER

Adopted: December 11, 1995       Released:  January 19, 1996

By the Chief, Cable Services Bureau:

I.   INTRODUCTION

     1.    On August 15, 1995, Century Cable of Southern California ("Century"), filed
an appeal of the local rate order adopted on August 9, 1995, by its local franchising authority,
the City of Redondo Beach, California (the "City"). The local order denies a proposed rate
increase sought by Century.  In its appeal, Century argues that the City failed to adhere to
Commission requirements for written decisions.  Century also sought a stay of the local rate
order pending our review.  On August 30, 1995, the City filed an opposition to Century's
appeal and an opposition to Century's petition requesting a stay pending appeal.  

     2.    Under our rules, rate orders adopted by local franchising authorities may be
appealed to the Commission.  In ruling on appeals of local rate orders, the Commission will
not conduct a de novo review, but instead will sustain the franchising authority's decision as
long as there is a reasonable basis for that decision.  The Commission will reverse a
franchising authority's decision only if it is determined that the franchising authority acted
unreasonably in applying the Commission's rules in rendering its local rate order.  If the
Commission reverses a franchising authority's decision, it will not substitute its own decision,
but instead will remand the issue to the franchising authority with instructions to resolve the
case consistent with the Commission's decision on appeal.  

II.  DISCUSSION

     3.    In a letter dated August 9, 1995, the City denied a proposed rate increase
sought by Century in its FCC Form 1210 filing.  The City's written decision consists of a
one-page letter that simply states that the City disapproved of Century's proposed rate
increase.  In its appeal, Century argues that this letter is insufficient under the Commission's
rules.  The City contends, in its opposition to the appeal, that it disapproved of Century's
proposal based on the "poor quality of service" offered by Century to its subscribers. 

     4.    The local order does not state why the City found Century's proposed rates to
be unreasonable.  In rate regulation proceedings, the cable operator bears the burden of
proving the reasonableness of all of its proposed regulated rates.  The local franchising
authority, however, must provide the cable operator with an opportunity to participate in the
rate review proceedings and to offer support for its proposed rates.  If the local franchising
authority determines that the operator's proposed rate exceeds the maximum permitted level as
defined by the Commission's rate standards, it may prescribe a rate different from the
proposed rate provided that the local franchising authority explains in a written decision why
the operator's rate is unreasonable and why its prescribed rate is reasonable.  

     5.    In order to comply with our rules, the City's rate order should have contained
such an explanation.  Instead, the City provided only a general explanation for its order in
its opposition to the appeal, asserting that Century had offered poor quality programming and
service to its subscribers.  The City's explanation is unacceptably vague.  Nothing in our
rules allows for rate decisions based on an unspecified concern about poor service.  Moreover, 
Commission rules require that the City provide an explanation for its action in a written
decision.  Asserting reasons for denying a rate proposal in an opposition to the appeal of the
rate order is not sufficient.  Because it appears from the record below that the City's written
decision did not adhere to Commission rules, we remand this case for further proceedings
consistent with this decision.

III. ORDERING CLAUSE

     6.    Accordingly, IT IS ORDERED that Century's Appeal of the local order of the
City of Redondo Beach, California IS GRANTED, and the cause IS REMANDED to the
City for further proceedings consistent with this Order.

     7.    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