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III.A; see also letter dated January 10, 1996 from David C. Olson, Director, Mt. Hood Cable Regulatory Commission to the Federal Communications Commission ("Olson Letter"). As required by the Social Contract, the LFA provided notice to  xthe Operator and the Commission of its election to opt out of the rate restructuring associated with the  S8- xLcreation of the Lifeline BST.U8Fo {O -ԍ See Social Contract, Sec. III.A.1.a U We permitted Operator to implement the Lifeline Tier and corresponding  S- xCPST rate adjustment on January 1, 1996.o {O-ԍ  See In the Matter of Social Contract for Time Warner Cable, 11 FCC Rcd 3099 (1995). Operator was required to rescind the Lifeline adjustment  xto both the BST and CPST retroactive to January 1, 1996 because of the LFA's election to opt out of the  S- xjBST and CPST revenue neutral rate restructuring.3j o {O-ԍ  Id.3 Our review reveals that Operator did not implement a Lifeline BST and CPST rate restructuring in the community referenced above because of the rescission.  SH - ` }x6.` ` Because the LFA believes that the Social Contact preempts its jurisdiction over Operator's  xinstallation charges and equipment rates, it has requested that we review Operator's FCC Form 1205 which  S - xyestablishes Operator's equipment rates and installation charges.A o {O-ԍ See Olson Letter.A Although under the Social Contract we  xdetermine whether cable operators comply with our regional averaging methodology for calculating  xequipment charges and installation rates, LFAs have the authority to enforce our standards and require  S - xCable Operators to issue refunds or order rate rollbacks, as appropriate. o {O- xԍ See In the Matter of Social Contract for Time Warner, 11 FCC Rcd 2788, 2805 (1996); see also Social Contract, Sec. III.B. Upon review, we find that  x?Operator's FCC Form 1205 is in compliance with our regional methodology for the calculation of  xequipment charges and installation rates. The LFA has the authority to enforce our findings regarding Operator's equipment charges and installation rates.  S- ` x7.` ` The LFA contends that Operator's revised FCC Form 1240 for the projected period  x=January 1, 1996 through December 31, 1996, improperly contains an inflation adjustment for the period  xending June 30, 1995. The LFA argues that because Operator is a transition system, Operator should  S@- xreduce its inflation pursuant to our Public Notice of November 9, 1995,@o {O$- x,ԍ  See Public Notice, Cable Rates Adjustment For Inflation Applied To Transition Rates DA 952295 (released: November 9, 1995). if Operator seeks to recover  xinflation for the period ending June 30, 1995. According to the LFA, Operator's revised FCC Form 1240  x]for the projected period January 1, 1996 through December 31, 1996 contains a revised maximum"B,_(_(IIa"  xpermitted rate ("MPR") which Operator uses as the starting rate on Line A1 of its subsequent FCC Form 1240 for the projected period January 1, 1997 through December 31, 1997.  S- ` x8.` ` Upon review of Operator's FCC Form 1240 for the projected period January 1, 1996  S`- xthrough December 31, 1996, we find that Operator has correctly calculated its MPR of $12.57. `o yO- xxԍ This finding is based solely on the representations of Operator. Should information come to our attention  xYthat these representations were materially inaccurate, we reserve the right to take appropriate action. This Order is  xnot to be construed as a finding that we have accepted as correct any specific entry, explanation or argument made by any party to this proceeding not specifically addressed herein. Because  xOperator has entered into a Social Contract with the Commission, the starting rate on Line A1 is  S- xdetermined by the terms of the Social Contract.Ro {O` -ԍ  See Social Contract, Sec. III.C.3.R Our review reveals that Operator's rate of $12.99  xexceeds its MPR of $12.57. Consequently, we find that Operator's rate of $12.99, effective January 1, 1996 is not justified and is unreasonable.  Sp- ` x9.` ` Upon review of Operator's FCC Form 1240 for the projected period January 1, 1997  xthrough December 31, 1997, we find that Operator has not correctly calculated its MPR. In particular,  xOperator made trueup adjustments through to the effective date of the rate increase. This is incorrect.  xThe annual adjustment afforded by FCC Form 1240 allows operators to project changes in external costs,  xinflation, and the number of regulated channels. This structure avoids the delay some operators  xexperienced in recouping costs through multiple rate adjustments throughout the year. Because projections  x[will not reflect the costs that actually occur, the Commission provided, as part of the annual adjustment,  xa "trueup" to correct projected cost changes with the actual cost changes. However, the Commission has  xnoted that, as FCC Form 1240 must be filed 90 days before an increase is to take effect, the period for  S- xthe trueup will not coincide with the previous year's projections.nBo yO-ԍ Thirteenth Reconsideration Order, 11 FCC Rcd 388, 420 fn 151 (1995).n The trueup data is intended to  S- xindicate real, not projected data.3o {OR-ԍ  Id.3 This policy is reflected in the instructions accompanying FCC Form  S-1240.ad o {O-ԍ  See FCC Form 1240 Instructions for Timing at 34.a  Sh- ` %x10.` ` Based on this instruction and considering evidence in the filing, reasonable time for  xclosing accounts and completing forms, we have adjusted Operator's trueup period from 12 months to  x9 months. This adjustment required that we refresh Operator's inflation factors to 2.22 for the second  xquarter of 1996 and to 2.21 for the third quarter of 1996 and adjust Worksheet 1 accordingly. As a result,  xythe trueup inflation factor in Module C, Line C1 for the 9 month period was corrected to 1.0171 instead  x0of the 1.239 used by the Operator for a 12 month period. We have adjusted Module E, and have  xcorrected the number of months on Line E2 to 9 months and Line E3 to 3 months. We have also adjusted  x.the inflation segment in Module F, Line F5 to reflect the corrections made in Line C1. This has resulted in a corresponding adjustment on Line F9 (MPR for TrueUp Period 1). x" ,_(_(IIk"Ԍ S- ` $x11.` ` The reduction in the length of the trueup period also results in a reduction in Line H2  x(Revenue From MPR for Period 1). This results in a corresponding reduction in Line I8 (TrueUp  xSegment for the Projected Period). In total, our adjustments to Operator's FCC Form 1240 result in a  S- xreduction of the MPR for the Projected Period to $13.63 (Line I9). o yO- xKԍ Information regarding the specific adjustments made to Operator's FCC Form 1240 filings can be found in  x,the public file for the community referenced above which is available in the Cable Services Bureau's public reference  x,room, or through the Commission's copy contractor, International Transcription Services (ITS), 1231 20th Street, N.W., Washington, DC 20554, or by calling ITS at (202) 8573800. Thus, Operator has failed to  x-demonstrate that its January 1, 1997 rate of $13.72 was not unreasonable. To the extent that external costs  S8- x>from the three months disallowed from Operator's trueup periodT!8o yO -ԍ As found on Operator's Worksheets 7 and 8.T have been averaged into the rates  xcharged in the nine months allowed in Operator's trueup period, and have not been removed by our  x[adjustments, we will order Operator to make a monthbymonth accounting of such external costs. Such  x\accounting shall allow a comparison of the actual external costs for the permitted ninemonth trueup  xlperiod with the recovery of external costs afforded by the external cost segment for that period as  xcalculated on Worksheet 7. We will order Operator to incorporate this accounting report into its refund  xplan and refund any overrecovery, plus interest, to subscribers. We will also order Operator to submit  xan FCC Form 1240 for the projected period January 1, 1997 to December 31, 1997 which incorporates our revisions and the adjustments described above.  S - ` x12.` ` Accordingly, IT IS ORDERED, pursuant to Section 0.321 of the Commission's rules, 47  xC.F.R.  0.321, that the CPST rate of $12.99, effective January 1, 1996 charged by Operator in the community referenced above, IS UNREASONABLE.  S- ` x13.` ` IT IS FURTHER ORDERED, pursuant to Section 0.321 of the Commission's rules, 47  xC.F.R.  0.321, that the CPST rate of $13.72, effective January 1, 1997, charged by Operator in the community referenced above, IS UNREASONABLE.  S-  Sh- ` `x14.` ` IT IS FURTHER ORDERED, pursuant to Section 0.32l of the Commission's rules, 47  xC.F.R. Section 0.321, that the complaint referenced herein against the CPST rate increase effective January 1, 1996 charged by Operator in the community set forth above, IS GRANTED.  S- ` x15.` ` IT IS FURTHER ORDERED, pursuant to Section 0.321 of the Commission's rules, 47  xC.F.R. Section 0.321 that the complaint referenced herein against the CPST rate increase effective January 1, 1997 charged by Operator in the community set forth above, IS GRANTED.  S(- ` x16.` ` IT IS FURTHER ORDERED, pursuant to Section 76.961 of the Commission's rules, 47  xC.F.R.  76.961, that Operator shall refund to subscribers in the community referenced above that portion  xof the amount paid in excess of the maximum permitted CPST rate of $12.57 per month (plus franchise fee) plus interest during the period from February 5, 1996 to December 31, 1996.  S`- ` x17.` ` IT IS FURTHER ORDERED, pursuant to Section 76.961 of the Commission's rules, 47  xC.F.R.  76.961, that Operator shall refund to subscribers in the community referenced above that portion  xof the amount paid in excess of the maximum permitted CPST rate of $13.63 per month (plus franchise" @!,_(_(II!"  xfee) plus interest during the period from January 1, 1997 to the day before Operator reduces its CPST rate to $13.63.  S- ` x18.` ` IT IS FURTHER ORDERED, pursuant to Section 0.321 of the Commission's rules, 47  xC.F.R.  0.321, that Operator shall conduct a monthbymonth accounting of its external costs from  xOperator's ninemonth trueup period as found on Operator's Worksheets, and that Operator shall file,  xzwithin 30 days of the release of this Order, a report detailing the overrecovery of external costs, plus interest, with the Chief, Cable Services Bureau.  S- ` Ax19.` ` IT IS FURTHER ORDERED, that Operator shall promptly determine the overcharges to  xjCPST subscribers for the stated periods, including any overrecovery as detailed in its accounting report,  xLand shall file, within 30 days of the release of this Order, a report with the Chief, Cable Services Bureau,  xstating the cumulative refund amounts so determined (including franchise fees and interest), describing  xthe calculations thereof, and describing its plan to implement the refund within 60 days of the Commission approval of the plan.  S - `   X` hp x (#%'0*,.8135@8: