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S- ` 2x2. ` ` Section 623(i) of the Communications Act of 1934, as amended ("Communications Act"),  xrequires that the Commission design rate regulations that reduce the administrative burdens and the cost  S- xLof regulatory compliance for cable systems with 1,000 or fewer subscribers.>X yO|-ԍ47 U.S.C.  543(i).> Accordingly, in the course  xof establishing the standard benchmark and costofservice ratemaking methodologies generally available  x>to cable operators, the Commission adopted various measures aimed specifically at easing regulatory  S - xburdens for these smaller systems.  {O- xԍSee, e.g., Report and Order and Further Notice of Proposed Rulemaking in MM Docket No. 92266, FCC 93 {O^ - x177, 8 FCC Rcd 5631 (1993); Second Order on Reconsideration, Fourth Report and Order, and Fifth Notice of  {O(!- xProposed Rulemaking in MM Docket No. 92266, FCC 9438, 9 FCC Rcd 4119 (1994); Fifth Order on  {O!- xReconsideration and Further Notice of Proposed Rulemaking in MM Docket Nos. 93215 & 93266, 9 FCC Rcd  {O"- x5327 (1994); Eighth Order on Reconsideration in MM Docket Nos. 92266 & 93215, FCC 9542, 10 FCC Rcd 5179 (1995). In the Small System Order, the Commission further extended small  S- xzsystem rate relief to certain systems that exceed the 1,000subscriber standard.Uj  {O%-ԍSmall System Order, 10 FCC Rcd at 7406.U These systems were" ,**88"  xldeemed eligible for small system rate relief because they were found to face higher costs and other  S-burdens disproportionate to their size. hm {O@- x[ԍId. at 7407. More recently, Congress amended Section 623 of the Communications Act to allow greater  xideregulation for "small cable operators," defined as operators that "directly or through an affiliate, [serve] in the  xaggregate fewer than 1 percent of all subscribers in the United States and [are] not affiliated with any entity or  xKentities whose gross annual revenues in the aggregate exceed $250,000,000." Telecommunications Act of 1996  xZ("1996 Act"), Pub. L. No. 104104,  301(c), 110 Stat. 56, approved February 8, 1996; Communications Act,   x623(m), 47 U.S.C.  543(m). Pursuant to this amendment, the rate regulation requirements of Sections 623(a), (b)  xand (c) do not apply to a small cable operator with respect to "(A) cable programming services, or (B) a basic service  xhtier that was the only service tier subject to regulation as of December 31, 1994," in areas where the operator serves  {O -50,000 or fewer subscribers. Id.  S- ` }x3. ` ` The Small System Order defines a small system as any system that serves 15,000 or fewer  Sb- xsubscribers.Ubhm {O -ԍSmall System Order, 10 FCC Rcd at 7406.U The Commission recognized that systems with no more than 15,000 subscribers were  x/qualitatively different from larger systems with respect to a number of characteristics, including: (1)  xkaverage monthly regulated revenues per channel per subscriber; (2) average number of subscribers per  S- xmile; and (3) average annual premium revenues per subscriber.:. hm {O-ԍId. at 7408.: The magnitude of the differences between  x.the two classes of systems as to these characteristics indicated that the 15,000 subscriber threshold was  xthe appropriate point of demarcation for purposes of providing for substantive and procedural regulatory  Sr-relief.2r hm {O-ԍId. 2  S" - ` x4. ` ` Rate relief provided under the Small System Order and the Commission's rules is also  S - xNavailable only to a small system affiliated with a small cable company, which is defined as a cable  S - xoperator that serves a total of 400,000 or fewer subscribers over all of its systems. ^ R hm {O- xxԍId. A small system is deemed affiliated with a cable company if the company "holds more than a 20 percent  {O- xequity USESESUSinterest (active or passive) in the system or exercises de jure control (such as through a general partnership  {OZ-or majority voting shareholder interest)." Id. at 741213, n.88. The Commission  x\adopted this threshold because it roughly corresponds to $100 million in annual regulated revenues, a  xstandard the Commission has used in other contexts to identify smaller entities deserving of relaxed  S\- xjregulatory treatment.= \xhm {Ot -ԍId. at 740911.= The Commission found that cable companies exceeding this threshold would find  xit easier than smaller companies to attract the financing and investment necessary to maintain and improve  S - xservice.:  hm {O#-ԍId. at 7411.: In addition, the Commission determined that cable companies that exceeded the small company  xdefinition "are better able to absorb the costs and burdens of regulation due to their expanded  S-administrative and technical resources.": hm {O&-ԍId. at 7409.: ". ,`(`(88"Ԍ S- ` oԙx5. ` ` In addition to adopting the new categories of small systems and small cable companies,  S- xthe Small System Order introduced a form of rate regulation known as the small system costofservice  S- xmethodology.= hm {O-ԍId. at 741828.= This approach, which is available only to small systems owned by small cable companies,  x[is more streamlined than the standard costofservice methodology available to cable operators generally.  xyIn addition, the small system rules include substantive differences from the standard costofservice rules  x[to take account of the proportionately higher costs of providing service faced by small systems. Eligible  x[systems establish their rates under this methodology by completing and filing FCC Form 1230. In order  xjto qualify for the small system costofservice methodology, systems and companies must meet the new  S- xsize standards as of either the effective date of the Small System Order, or on the date thereafter when  S-they file the documents necessary to elect the relief they seek.Zhm {O -ԍId. at 7413. The effective date of the Small System Order was August 21, 1995.  SL - `  x6. ` ` Cable systems that fail to meet the numerical definition of a small system, or whose  xjoperators do not qualify as small cable companies, may submit petitions for special relief requesting that  xthe Commission grant a waiver of its rules to enable the petitioning systems to utilize the various forms  S - x.of rate relief available to small systems owned by small cable companies.= hm {O`-ԍId. at 741213.= The Commission stated that  S - xpetitioners should demonstrate that they "share relevant characteristics with qualifying systems."1 ~hm {O-ԍId.1 Other  xlpotentially pertinent factors include the degree by which the system fails to satisfy either or both  xdefinitions and evidence of increased costs (e.g., lack of programming or equipment discounts) faced by  S4- xthe operator.14hm {O-ԍId.1 If the system fails to qualify for relief based on its affiliation with a larger cable company,  xthe Commission will consider "the degree to which that affiliation exceeds our affiliation standards, and  xwhether other attributes of the system warrant that it be treated as a small system notwithstanding the  S- xpercentage ownership of the affiliate."2hm {O-ԍId. 2 The Commission also stated that "a qualifying system that seeks  xjto obtain programming from a neighboring system by way of a fiber optic link, but that is concerned that  xinterconnection of the two systems may jeopardize its status as a standalone small system, may file a  SD- xpetition for special relief to ask the Commission to find that it is eligible for small system relief.":D4 hm {O -ԍId. at 7413.: The  x=Commission specifically stated that this list of relevant factors was not exclusive and invited petitioners  S-to support their petitions with any other information and arguments they deemed relevant.1 hm {OZ#-ԍId.1 "X ,`(`(883"Ԍ S- II.xTHE PETITION  S- `  x7. ` ` Community TV owns and operates two systems that serve 25 largely rural and vacation  S- xareas in New Hampshire.8hm yO-ԍPetition at 23.8 Prior to February 1995, Community TV was comprised of four standalone  xcable systems, each served by one headend: the Americable Group, which is not a subject of the Petition;  xtwo systems serving the Lakes areas; and one system serving the Laconia area. Community TV states that  xin February 1995, it interconnected the latter three systems by fiber optic cable to "increase operating  S- xefficiencies and improve service to subscribers."7Xhm {O -ԍId. at 3.7 Community TV is not affiliated with any other cable systems.  Sp- ` x8. ` ` Community TV states that, as of June 30, 1995, the two Lakes systems served a total of  x7,784 subscribers, and the Laconia system served 20,651 subscribers, for a total of 28,345 subscribers.  xjAccording to Community TV, including the Americable Group, it serves a total of approximately 49,681  S - xzsubscribers.= hm {O-ԍId. at 3.= Therefore, while Community TV easily qualifies as a "small cable company" under the  S - x[Small System Order,? |hm {O-ԍSee supra note 9.? the interconnected Lakes/Laconia system exceeds the 15,000subscriber threshold for a small system, thus making it ineligible for the small system costofservice rules absent a waiver.  SZ- ` x9. ` ` In support of its Petition, Community TV states that, considered individually, the Lakes  xsystems and the Laconia system share the characteristics of the average "small system" set forth in the  S - xySmall System Order. Specifically, the Lakes systems: (a) yield an average monthly regulated revenue per  S- xzchannel per subscriber of $0.55, as compared to the $0.86 for the average small system;ohm {O-ԍPetition at 5. See Small System Order, 10 FCC Rcd at 7408. o (b) serve an  xMaverage of 18.3 subscribers per mile, versus the 35.3 subscribers per mile served by the average small  S- xsystem;1hm {O-ԍId.1 and (c) receive $34.33 in average premium revenue per subscriber, as compared to $41.00  Sl- xreceived by the average small system.1l2 hm {O>-ԍId.1 With respect to the Laconia system: (a) the average monthly  xregulated revenue per channel per subscriber is $0.50; (b) the average number of subscribers per mile is  x38.0 (which Community TV acknowledges as "slightly over" the small system average of 35.3); and (c)  xMthe average premium revenue per subscriber is $32.87. Community TV states that the Lakes system  S-clearly qualifies as a small system, and asserts that the "same is true for the Laconia Group."7 hm {O0$-ԍId. at 6.7  S|- ` x 10. ` ` Community TV states that the only qualifying criterion not satisfied by both the Lakes  xsystems and the Laconia system is the 15,000 subscriber maximum, which the Laconia system exceeds  xkby 5,651. Community TV states, however, that this figure is "misleading" because approximately 20",V ,`(`(88"  x[percent of the homes in the Laconia area are seasonal and produce revenue only three to four months per  S- xyear.Zhm yO@- xԍPetition at 3. Community TV attaches the 1990 Decennial Census which demonstrates that 21.89% of the total  xhousing units in the Laconia service area were seasonal. If that ratio is applied to Laconia's system, 16,131  {O-subscribers receive cable service yearround. See Petition at n.20 and Exhibit 1. Community TV believes that this overage should not bar the interconnected Lakes/Laconia system  xfrom small system status because the Laconia system possesses "almost all" of the other characteristics  x=of an average small system. Community TV also states that, because seasonal subscribers produce only  xa fraction of the revenue produced by yearround subscribers, Community TV's ability to earn a  xreasonable return on investment is significantly delayed, and in certain locations, denied altogether.  xCommunity TV also notes that investment in cable plant, programming and other services are no lower  S-in these seasonal areas than in the areas where subscribers receive service yearround.9hm {Or -ԍId. at 67.9  S- ` Px 11. ` ` Community TV contends that the Lakes/Laconia system should be accorded small system  xLstatus because its costs of providing service are relatively high. First, it states that, because Community  xTV has a total subscribership of only 49,681 subscribers, Community TV does not receive any of the  xeconomic advantages available to larger systems, such as programming purchasing discounts. Community  xTV also states that its engineering and maintenance expenses are relatively high because it serves a low  S -density area that includes a large number of lakes.: |hm {O-ԍId. at 910.:  S - ` x 12. ` ` With respect to revenues, Community TV asserts that the interconnected Lakes/Laconia  xqualifies as a small system because the income generated by the system is constrained because: (a) the  x<system serves relatively few subscribers; (b) the system serves many seasonal subscribers who take service  S- xonly three to four months per year; and (c) the system serves relatively lowincome areas.: hm {O-ԍId. at 910.: Community  xTV states that the median household income in the areas served by the Lakes systems and the Laconia  S- xsystem is approximately $32,000 as compared to $36,329 for the state of New Hampshire.8!hm {O-ԍId. at 10.8 Community  xTV asserts that these circumstances limit its ability to generate new revenue by offering new services or  xengaging in promotional campaigns; in fact, Community TV has not sold any local advertising because  xkthe prospective revenues are not sufficient to justify the necessary investment and staff. In addition,  xkCommunity TV states that it faces difficulties in justifying the financing of upgrading or extending its  S- xsystem, as requested by local franchising authorities ("LFAs").1"2 hm {O!-ԍId.1 Finally, Community TV contends that,  xbecause it is unable to spread the costs of an inhouse staff over a broad subscriber base, it must "rely  S-heavily" on outside accounting and legal expertise to administer its compliance with federal regulations.7# hm {O%-ԍId. at 9.7  SP- ` x 13. ` ` Community TV states that granting small system status to the interconnected Lakes and  S(- xyLaconia systems will serve the public interest, as discussed in the Small System Order, by permitting the"(V #,`(`(88"  xsystems to use streamlined ratemaking, which will greatly alleviate their compliance burdens as well as  xbenefit the seventeen LFAs that oversee service by the Lakes systems and the Laconia system. These  xsavings would enable the systems to devote more resources toward upgrading plant, enhancing  S-programming, adding ancillary services and extending service to currently unserved areas.8$hm {O-ԍId. at 11.8 0(#(#X  S8- III.xDISCUSSION  S- ` Rx 14. ` ` We begin with a comparison of Community TV's subscriber base to the small cable  S- xMcompany and small system definitions.%Zhm {O - xԍSee Small System Order, 10 FCC Rcd at 7412 (relevant factors "include the degree by which the system fails to satisfy either or both definitions.") Since Community TV is not affiliated with any other cable  xsystem, and its systems serve a total of about 50,000 subscribers, Community TV falls well below the  Sp- xj400,000subscriber threshold for small cable companies.k&phm {O-ԍPetition at 2; see Small System Order, 10 FCC Rcd at 741213.k On the other hand, total subscribership to the  xiinterconnected systems that are the subject of the Petition substantially exceeds the small system definition.  xjThe Lakes and Laconia systems serve a total of 28,345 subscribers, or almost twice the 15,000 threshold  S - xset forth in the Small System Order. As a practical matter, Community TV can be viewed as a  xcombination of two systems, that, according to Community TV, "have been interconnected by fiber optic  S - xcable in order to enhance operating efficiencies and improve service to subscribers."6' Fhm yO-ԍPetition at 3.6 In the Small System  S - xOrder, the Commission specifically recognized the appropriateness of waiver petitions in cases where  S^- xinterconnection of multiple small systems created a single system of over 15,000 subscribers.U(^hm {O-ԍSmall System Order, 10 FCC Rcd at 7413.U Moreover,  S6- xas we stated in an analogous case concerning Inter Mountain Cable, Inc. ("Inter Mountain Order"), the  xCommission "seeks to encourage interconnection where it would allow an operator to become more  S-efficient and provide benefits to subscribers.")h hm {O- xԍMemorandum Opinion and Order, In the Matter of Inter Mountain Cable, Inc., Petition for Special Relief, CSR 4580D, DA 96940, 11 FCC Rcd 7081, 7086 (1996).  S- ` x15.` ` The Inter Mountain Order is instructive. In that case, we granted small system status to  xa cable system that served more than 23,000 subscribers, because the system was comprised of over 40  SJ- xinterconnected systems, each of which qualified for small system status.:*J hm {O!-ԍId. at 7088.: With respect to Community  xTV's Petition, the relevant question is whether the systems that have been interconnected to create the  xjLakes/Laconia system, when considered individually, may qualify for small system status. Based on the  x=record before us, the Lakes systems clearly qualify. These systems serve a total 7,784 subscribers, well  S- xbelow the small system threshold, and share relevant characteristics with the average small system.C+T hm {O&-ԍSee supra at para. 3.C For  xjexample, while the average small system serves about 35.3 subscribers per mile, the Lakes systems serve"+,`(`(88"  x=only 18.3. Likewise, the average small system earns $0.86 in monthly regulated revenues per subscriber  xper channel, and $41.00 in annual premium revenues, while the Lakes systems earn only $0.55 and  S- x0$34.33,,Zhm yO- x>ԍThe disparity with respect to premium revenues was specifically recognized by the Commission as a  xjustification for the small system definition and was highlighted as a particular problem for smaller systems in a  {O-number of comments that lead to the adoption of the Small System Order. Small System Order, 10 FCC Rcd at 7402. respectively.6-hm yO:-ԍPetition at 5.6 The disparity in the subscriber density of the Lakes area is particularly  S- xpersuasive. As summarized in the Small System Order: "[C]ommenters observe that a smaller system  x=serving a large rural area faces increased costs due to the increased amount of cable that must be installed  xto reach the entire area and increased operating costs given the greater amount of facilities that must be  S-maintained."1.zhm {O, -ԍId.1  S- ` x16.` ` With regard to the Laconia system, it serves a total of 20,651 subscribers, or 37.6% over  xthe small system threshold of 15,000. Community TV has submitted data to demonstrate that 21.89% of  xthe housing units in the Laconia service area are occupied on a seasonal basis for only three or four  x-months per year. Applying this ratio to Laconia's subscriber base, the Laconia system serves about 16,131 yearround subscribers, or only 7.54% over the small system threshold.  S - ` 3x17. ` ` In the Third Order on Reconsideration in MM Docket No. 92266,I/ hm yO~-ԍFCC 9440, 9 FCC Rcd 4316 (1994).I the Commission  xzdecided that permitting a cable operator to include dwelling units that are inhabited only seasonally in  xcalculating its penetration rate in a particular area would diminish the validity of this measure as an  S\- xLindicator of whether the operator faces effective competition in that area.:0\hm {O-ԍId. at 4324.: We stated that the "best and  S4- xmost constant" indicator of subscriber choice is represented by the fulltime residents of an area.114. hm {O-ԍId.1 We  xfurther found that fulltime residents are most affected by the decision whether their cable rates are  S- xregulated.12 hm {OD-ԍId.1 We believe this reasoning should be extended to the decision whether cable rates are  xregulated under streamlined ratemaking that is available only to small systems, or otherwise. We think  xit consistent with the Commission's policies to exclude Laconia's seasonal subscribers in measuring whether and by how much Laconia's subscribership may exceed the small system definition.  S- ` x18. ` ` In light of other factors relevant to Community TV's Petition, we find that Laconia's  xkservice to 2,261 subscribers over the threshold does not undermine Community TV's request that the  xinterconnected Lakes/Laconia system be accorded small system status. We previously have bestowed  xsmall system status to cable systems that exceed the 15,000 subscriber limit, where it has been shown that"R 2,`(`(88"  S- x{the cable system shares other relevant characteristics with small systems.%3hm {Oh- x ԍMemorandum Opinion and Order, In the Matter of Insight Communications Company, L.P., Petition for Special  {O2- xRelief, DA 952334, 11 FCC Rcd 1270 (1995)("Insight Order")(granting small system status to three systems serving  {O- xJ16,348, 16,328 and 17,798 subscribers, respectively); Memorandum Opinion and Order, In the Matter of Rifkin &  xLAssociates d/b/a Columbia Cablevision, Petition for Special Relief, DA 962026 (released December 4, 1996)  {O- x(granting small system status to system serving 17,083 subscribers); Inter Mountain Order (granting small system status to system serving 23,000 subscribers).% For example, on a per  xsubscriber basis, the Laconia system receives only $0.50 in monthly regulated revenues per channel and  xonly $32.87 in annual premium revenues, both of which fall well below the average small system's  S- xrevenues of $0.86 and $41.00, respectively.64Hhm yOp -ԍPetition at 5.6 We note that the Laconia system's subscriber density of  xy38.0 subscribers per mile exceeds the 35.3 subscribers per mile served by the average small system. This  xzfigure is 7.65% over the average for a small system, however, and well below the 68.7 subscribers per  xjmile served by the average system with over 15,000 subscribers. We find this disparity insignificant and not a substantial impairment of Community TV's Petition.  S- ` x19. ` ` Both the Lakes systems and the Laconia system face other obstacles typically faced by  xsmall systems, as well. For example, Community TV's costs of providing service are relatively high  xbecause Community TV serves a total of less than 50,000 subscribers. As a result, Community TV is  xMunable to secure the bulk discounts that cable programming and equipment vendors make available to  xlarger systems. Community TV also describes the difficulties it has encountered in obtaining financing  xbecause its revenues are constrained by the seasonal nature of many of its subscribers, and the fact that  x?the Laconia and Lakes systems serve relatively lowincome areas. This latter circumstance limits Community TV's ability to generate new revenues through promotions or the sale of premium services.  S0- ` x20. ` ` A final factor weighing in favor of granting small system status to Community TV is the  x-absence of any opposition to the Petition, despite service of the Petition upon the relevant local franchising authorities and public notice of the Petition by the Commission.  S- ` nx21. ` ` Under Section 76.7(c)(1) of the Commission's rules, a petition for special relief "shall state  xfully and precisely all pertinent facts and considerations relied on to demonstrate the need for the relief  S@- xrequested and to support a determination that a grant of such relief would serve the public interest."B5@hm yO-ԍ47 C.F.R.  76.7(c)(1).B  x Community TV has adequately established its "need for the relief requested," as required by Section  S- x76.7(c)(1). In making this finding, we note the Commission's decision in the Small System Order to target  x{rate relief at small systems owned by operators with fewer than 400,000 subscribers based on the  xrecognition that the thenexisting rate rules did not sufficiently take account of the higher costs of business  Sz- xfaced by smaller companies.U6zh hm {O#-ԍSmall System Order, 10 FCC Rcd at 7420.U In addition, the Commission found that qualifying systems and companies  x[were in need of relief from the procedural burdens imposed upon such entities by the other forms of rate  S*- xregulation.37* hm {O&-ԍId. 3 The Commission found that alleviating the substantive and procedural burdens associated"* 7,`(`(88{"  xwith the standard benchmark and costofservice methodologies "should free up resources that affected  xoperators currently devote to complying with existing regulations and should enhance those operators'  xability to attract capital, thus enabling them to achieve the goals of Congress," as set forth in the 1992  S-Cable Act.c8hm {O-ԍId. at 7407, citing 1992 Cable Act,  2(b)(1)(3).c x` `  S8- ` x22. ` ` Community TV's subscriber base of under 50,000 clearly establishes its status as a small  x>cable company. Although Community TV has configured its facilities serving the Lakes and Laconia  xservice areas such that they constitute a single system that exceeds the 15,000subscriber threshold for  xksmall systems, for the reasons stated above we conclude that this condition does not create a material  xdistinction between Community TV and the class of systems specifically targeted by the Commission for  xrelief. Based on reasons described above, we find that the characteristics of the Lakes systems and the  x\Laconia systems, analyzed individually, comport with our small system requirements. Moreover, as  S - xdiscussed in the Inter Mountain Order, we seek to encourage operators to interconnect systems where  xbenefits would accrue to subscribers. Thus, we conclude that Community TV's combination of the Lakes systems and the Laconia system shall be treated as one small system.  S - ` px23. ` ` Granting Community TV's request will reduce its burden of complying with federal  xregulations, and allow more of its limited revenue to be used for the improvement of service. As indicated  S2- xabove, in the Small System Order the Commission found that extending rate relief to those operators in  xneed of it would further specific congressional goals set forth in the 1992 Cable Act's Statement of  S- xPolicy.D9Zhm {O-ԍSee supra at para. 18.D Having concluded that Community TV also needs that relief, granting the Petition will serve the  S- xsame congressional goals that were furthered by the adoption of the Small System Order and thus is in the public interest.  SF- IV.xSCOPE OF THE WAIVER  S- ` x24. ` ` As a result of our grant of the Petition, Community TV interconnected Lakes/Laconia  xsystem shall be deemed a small system for purposes of rate regulation. Accordingly, to the extent that  S- xCommunity TV's BST and CPST are subject to rate regulation,W:d hm yO2- xԍAs of the 1996 Act's enactment on February 8, 1996, rate regulation does not apply to a small cable operator  xwith respect to CPSTs, or a BST that was the only service tier subject to regulation as of December 31, 1994. For  xpurposes of this provision, a "small cable operator" is defined as one that, directly or through an affiliate, serves in  xthe aggregate fewer than 615,000 subscribers and is not affiliated with any entity whose gross annual revenues exceed  {OR - x$250,000,000. 47 U.S.C.  543(m); Order and Notice of Proposed Rulemaking in CS Docket No. 9685, 11 FCC  x<Rcd 5937, 5947 (1996). As discussed above, small system relief under our rules is available only to systems that  xserve fewer than 15,000 subscribers and are not affiliated with a cable operator that serves more than 400,000  {O"- xKsubscribers, absent a waiver. See supra paras. 34. Accordingly, a rate complaint that is filed concerning a cable  xisystem that is deemed a small system under our rules may not invoke rate regulation of the system's CPST, or of its BST if the BST was the only service tier subject to regulation as of December 31, 1994. W the system may now set rates prospectively in accordance with the small system costofservice methodology. "V :,`(`(88"Ԍ S- `  x25. ` ` We next must determine the duration of the waiver. In the Small System Order, after establishing the new small system and small cable company definitions, the Commission stated:  `  ` XxX` ` To qualify for any existing form of [small system] relief, systems and  ` companies must meet the new size standards as of either the effective  ` date of this order or on the date thereafter when they file whatever  ` Udocumentation is necessary to elect the relief they seek, at their election.  ` . . . A system that is eligible for small system relief on either of the  `  dates described above shall remain eligible for so long as the system has  ` 15,000 or fewer subscribers, regardless of a change in the status of the  `  company that owns the system. Thus, a qualifying system will remain  ` eligible for relief even if the company owning the system subsequently  ` exceeds the 400,000 subscriber cap. Likewise, a system that qualifies  ` )shall remain eligible for relief even if it is subsequently acquired by a  S -company that serves a total of more than 400,000 subscribers.;$ E {O:- xԍSmall System Order, 10 FCC Rcd at 7413. The quoted text was discussing a system's initial and continuing  xKeligibility for "any existing form of relief," which did not include the small system costofservice methodology.  {O- xHowever, later in the order the Commission applied the same eligibility standards to that methodology as well. Id. at 742728.x`  `    S - ` 2 x26. ` ` The Commission adopted this grandfathering treatment for qualifying systems to enhance  SZ- xtheir value "in the eyes of operators and, more importantly, lenders and investors.":<Zhm {O-ԍId. at 7413.: As the Commission  xstated: "The enhanced value of the system thus will strengthen its viability and actually increase its ability  S -to remain independent if it so chooses."1= Fhm {O-ԍId.1 x` `  S- ` #x27. ` ` Upon exceeding the 15,000 subscriber threshold, a system that has established its rates in accordance with the small system costofservice methodology:  ` XxX` ` . . . may maintain its then existing rates. However, any further  ` adjustments shall not reflect increases in external costs, inflation or  ` channel additions until the system has reestablished initial permitted rates  S-in accordance with our benchmark or costofservice rules.?>hm {OB -ԍId. at 742728. ?x`  Sz- ` Bx28. ` ` Since the Lakes/Laconia system already exceed 15,000 subscribers, there is no obvious  xnumerical limit to serve as a cutoff for its continued eligibility for small system treatment. However, it  xis reasonable to presume that the system will continue to grow. Thus, we must place some duration on  xthe waiver, since the alternative would be to grant small system status indefinitely, regardless of the  xeventual size of the system. This latter alternative is clearly inconsistent with the Commission's decision to limit small system relief to systems who are in need of it due to their relatively small size. " j >,`(`(88"Ԍ S- ` x29. ` ` Therefore, as we have ordered in the context of similar waiver situations, the Community  S- xTV waiver will terminate two years from the date of this order, subject to the conditions set forth below.}?hm {O@-ԍInsight Order, 11 FCC Rcd 1276; Inter Mountain Order, 11 FCC Rcd at 7090.}  xDuring the waiver period, Community TV may file only one Form 1230 for each franchise area served  xzby the Lakes/Laconia system. This should give Community TV adequate regulatory certainty for the  x=foreseeable future, while still ensuring that the system is not permitted to charge rates indefinitely under  xza scheme designed for smaller systems. Of course, Community TV may seek continued eligibility for small system treatment by filing a petition for special relief at the end of the waiver period.  S- ` x30. ` ` Limiting the waiver period to two years means that any Form 1230 to be filed by  xKCommunity TV must be submitted with the appropriate regulatory authorities within two years of the date  xof this order. In any franchise area where the system is currently subject to regulation, Community TV  xmay reestablish its maximum permitted rates by filing Form 1230 at any time in the next two years.  xWhere the system is not currently subject to regulation but becomes subject within the next two years  xto regulation Community TV then may file Form 1230 within the normal response time. Where the  xsystem is not now subject to regulation, and does not become subject to regulation until more than two years from now, Community TV will not be eligible for small system treatment under this waiver.  SX- ` x31. ` ` After filing its initial Form 1230 and giving the required notice, the Lakes/Laconia system  xmay set its actual rates in a particular franchise area at any level that does not exceed the maximum rate,  xsubject to the standard rate review process. Subsequent increases, not to exceed the maximum rate  xestablished by the Form 1230, shall be permitted, subject to the 30 days' notice requirement of the  S- xCommission's rules.w@\Zhm {O- xԍSmall System Order, 10 FCC Rcd at 7426. Under the small system rules, rate increases taken after the initial  x;Form 1230 has been approved are not subject to further regulatory review, as long as the rate is no higher than that  {OD-permitted by the previouslyfiled form. Id.w As noted, the maximum rate established by the initial Form 1230 shall be a cap  xon the system's rates during the waiver period. If the system reaches that cap and subsequently wishes  xto raise rates further, it will have to justify the rate increase in accordance with our standard benchmark  xMor costofservice rules. Alternatively, the system can file another petition for special relief and seek  xcontinued treatment as a small system. Limiting the Lakes/Laconia system to a single Form 1230 filing  xMfor each franchise area provides further assurance that the system will not have grown too large to be establishing rates under the small system costofservice methodology. " ~@,`(`(88"Ԍ S- V.xORDERING CLAUSES  S- ` _x32. ` ` Accordingly, IT IS ORDERED that the Petition for Special Relief filed by Community  xTV Corporation requesting a waiver of the Commission rules defining systems subject to small system  S`-rate relief IS GRANTED.  S- ` x 33. ` ` This action is taken pursuant to delegated authority under Section 0.321 of the  S-Commission's rules.=Ahm yOP-ԍ47 C.F.R.  0.321.= x` `  hhFEDERAL COMMUNICATIONS COMMISSION x` `  hhMeredith J. Jones x` `  hhChief, Cable Services Bureau