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Casco Cable Television of Bath, Maine, Inc. ("Casco") seeks a waiver of the Commission's rules to  d(#[the extent necessary to permit Casco to establish regulated cable rates on behalf of its Brunswick, Maine  Sp- d(#system in accordance with the small system costofservice methodology adopted in the Sixth Report and  SJ- d(#Order and Eleventh Order on Reconsideration in MM Docket Nos. 92266 and 93215 ("Small System  S$- d(#Order").U$ yO-ԍ FCC 95196, 10 FCC Rcd 7393 (1995).U No oppositions were filed in this proceeding. We also address a petition for reconsideration,  d(#\and a request for stay, against our prior order ("Prior Order") in which we granted complaints against  d(#Casco's cable programming services tier ("CPST") rates in certain franchise areas in its Brunswick system  S-after finding that Casco's Brunswick system was not entitled to small system status.D"X {O- v #X\  P6G;P#эIn the Matter of Casco Cable Television, Inc., Casco Cable Television of Bath, Maine, Inc., 13 FCC Rcd  d(#-6010 (1997). This order granted complaints filed against CPST rates charged by Casco, beginning September 1,  d(#1993, in Topsham (CUID ME0055), Brunswick (CUID ME0057) and Bath (CUID ME0083). Because we are addressing Casco's petition for reconsideration, we will dismiss its request for stay, filed October 27, 1997, as moot.D  S^- 2 2.` ` Section 623(i) of the Communications Act of 1934, as amended ("Communications Act"),  d(#requires that the Commission design rate regulations that reduce the administrative burdens and the cost  S- d(#Lof regulatory compliance for cable systems with 1,000 or fewer subscribers.GB yO&-ԍ47 U.S.C.  543(i).G Accordingly, in the course  d(#of establishing the standard benchmark and costofservice ratemaking methodologies generally available  d(#>to cable operators, the Commission adopted various measures aimed specifically at easing regulatory" ,**88)""  S- d(#burdens for these smaller systems.(] {Oh- v ԍSee, e.g., Report and Order and Further Notice of Proposed Rulemaking in MM Docket No. 92266, FCC  {O2- d(#93177, 8 FCC Rcd 5631 (1993); Second Order on Reconsideration, Fourth Report and Order, and Fifth Notice of  {O- d(#Proposed Rulemaking in MM Docket No. 92266, FCC 9438, 9 FCC Rcd 4119 (1994); Fifth Order on  {O- d(#Reconsideration and Further Notice of Proposed Rulemaking in MM Docket Nos. 93215 & 93266, 9 FCC Rcd  {O- d(#5327 (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- d(#zsystem rate relief to certain systems that exceed the 1,000subscriber standard.^J(] {O-ԍSmall System Order, 10 FCC Rcd at 7406.^ These systems were  d(#ldeemed eligible for small system rate relief because they were found to face higher costs and other  S-burdens disproportionate to their size. (] {O - v >ԍId. at 7407. More recently, Congress amended Section 623 of the Communications Act to allow greater  d(#ideregulation for "small cable operators," defined as operators that "directly or through an affiliate, [serve] in the  d(#aggregate fewer than 1 percent of all subscribers in the United States and [are] not affiliated with any entity or  d(#Kentities whose gross annual revenues in the aggregate exceed $250,000,000." Telecommunications Act of 1996  d(#Z("1996 Act"), Pub. L. No. 104104,  301(c), 110 Stat. 56, approved February 8, 1996; Communications Act,   d(#623(m), 47 U.S.C.  543(m). Pursuant to this amendment, the rate regulation requirements of Sections 623(a), (b)  d(#and (c) do not apply to a small cable operator with respect to "(A) cable programming services, or (B) a basic service  d(#htier that was the only service tier subject to regulation as of December 31, 1994," in areas where the operator serves  {OH-50,000 or fewer subscribers. Id.   S:-  }3.` ` The Small System Order defines a small system as any system that serves 15,000 or fewer  S- d(#subscribers.^(] {Od-ԍSmall System Order, 10 FCC Rcd at 7406.^ The Commission recognized that systems with no more than 15,000 subscribers were  d(#/qualitatively different from larger systems with respect to a number of characteristics, including: (1)  S- d(#kaverage monthly regulated revenues per channel per subscriber; (2) average number of subscribers per  S- d(#mile; and (3) average annual premium revenues per subscriber.KB(] {O~-ԍXId. at 7408.(#K The magnitude of the differences between  St- d(#.the two classes of systems as to these characteristics indicated that the 15,000 subscriber threshold was  d(#the appropriate point of demarcation for purposes of providing for substantive and procedural regulatory  S$ -relief.; $ (] {O-ԍId. ;  S - 4.` ` Rate relief provided under the Small System Order and the Commission's rules is also  S - d(#Navailable only to a small system affiliated with a small cable company, which is defined as a cable  S - d(#operator that serves a total of 400,000 or fewer subscribers over all of its systems. ^ f(] {O#- v [ԍId. A small system is deemed affiliated with a cable company if the company "holds more than a 20 percent  {OV$- d(#equity USESESUSinterest (active or passive) in the system or exercises de jure control (such as through a general partnership  {O %-or majority voting shareholder interest)." Id. at 741213, n.88. The Commission  S^- d(#\adopted this threshold because it roughly corresponds to $100 million in annual regulated revenues, a  d(#standard the Commission has used in other contexts to identify smaller entities deserving of relaxed"6 ,`(`(88;"  S- d(#[regulatory treatment.F (] {Oh-ԍId. at 740911.F The Commission found that cable companies exceeding this threshold would find  d(#it easier than smaller companies to attract the financing and investment necessary to maintain and improve  S- d(#service.C Z(] {O-ԍId. at 7411.C In addition, the Commission determined that cable companies that exceeded the small company  d(#definition "are better able to absorb the costs and burdens of regulation due to their expanded  S`-administrative and technical resources."C `(] {O-ԍId. at 7409.C  S- o5.` ` In addition to adopting the new categories of small systems and small cable companies,  S- d(#the Small System Order introduced a form of rate regulation known as the small system costofservice  S- d(#methodology.F~(] {O -ԍId. at 741828.F This approach, which is available only to small systems owned by small cable companies,  d(#[is more streamlined than the standard costofservice methodology available to cable operators generally.  d(#yIn addition, the small system rules include substantive differences from the standard costofservice rules  d(#[to take account of the proportionately higher costs of providing service faced by small systems. Eligible  d(#[systems establish their rates under this methodology by completing and filing FCC Form 1230. In order  d(#jto qualify for the small system costofservice methodology, systems and companies must meet the new  S - d(#size 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. (] {O\-ԍId. at 7413. The effective date of the Small System Order was August 21, 1995.  S\-  6.` ` Cable systems that fail to meet the numerical definition of a small system, or whose  d(#joperators do not qualify as small cable companies, may submit petitions for special relief requesting that  d(#the Commission grant a waiver of its rules to enable the petitioning systems to utilize the various forms  S- d(#.of rate relief available to small systems owned by small cable companies.F(] {O&-ԍId. at 741213.F The Commission stated that  S- d(#petitioners should demonstrate that they "share relevant characteristics with qualifying systems.":4 (] {O-ԍId.: Other  d(#lpotentially pertinent factors include the degree by which the system fails to satisfy either or both  d(#definitions and evidence of increased costs (e.g., lack of programming or equipment discounts) faced by  SD- d(#the operator.:D (] {O!-ԍId.: If the system fails to qualify for relief based on its affiliation with a larger cable company,  d(#the Commission will consider "the degree to which that affiliation exceeds our affiliation standards, and  d(#whether other attributes of the system warrant that it be treated as a small system notwithstanding the  S- d(#percentage ownership of the affiliate.";X (] {O%-ԍId. ; The Commission also stated that "a qualifying system that seeks  S- d(#jto obtain programming from a neighboring system by way of a fiber optic link, but that is concerned that  d(#interconnection of the two systems may jeopardize its status as a standalone system, may file a petition"|,`(`(88"  S- d(#for special relief to ask the Commission to find that it is eligible for small system relief."C(] {Oh-ԍId. at 7413.C The  d(#=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.:Z(] {O-ԍId.:  S`- II.THE PETITION  S- 7.` ` According to the Petition and supplemental filings, Casco operates a system in Brunswick,  d(#ZMaine serving 14,248 subscribers (CUID Nos. ME0083, ME0057, ME0055, ME0076, ME0258, ME0259,  d(#and ME0338), and a system in Newcastle, Maine serving 3,728 subscribers (CUID Nos. ME0281,  S- d(#=ME0278, ME0282, ME0164, ME0165, ME0163, ME0279, ME0166 and ME0280).Z(] {O$ - v ԍPetition at 2;  See also Letter from Donna C. Gregg, Counsel for Casco, to Claire Blue, Attorney, Cable  d(#Services Bureau, Federal Communications Commission, March 18, 1998 ("March 18 Letter") at 2. Casco's supplemental filing shows a decrease of the subscriber base in its two Maine systems.  Each of Casco's  d(#two systems serve fewer than 15,000 subscribers and therefore qualify as a small system. In addition,  d(#Casco's parent, Susquehanna Cable Co. ("Susquehanna") owns or controls systems that serve 162,620  S - d(#ysubscribers, and therefore qualifies as a small cable company.A (] yO-ԍPetition at 2. A However, Casco notes that it is affiliated  d(#with Lenfest York, Inc. ("Lenfest"), a large cable company, through a combination of direct and indirect  S - d(#ownership interests.D (] {O-ԍId. at 23. D Casco states that Lenfest holds a 30% interest in Casco because Lenfest holds a  S - d(#M17.5% equity interest directly in Casco and 14.9% interest in Casco's parent, Susquehanna.B 0 (] {Ox-ԍId. at 23.B To the  d(#Lextent Casco is affiliated with Lenfest, Casco's Brunswick system is ineligible for the small system cost SX-ofservice methodology, absent special relief._ZX (] yO- v ԍCasco inherited the small system status of the Newcastle system from the prior owner and thus is only  {O- d(#seeking rate relief on behalf of its Brunswick system. See March 18 Letter at 2.  See also Small System Order, 10 FCC Rcd at 7427 7428._  S-  38.` ` Casco argues that Lenfest's interest in Casco is passive and that Casco receives little if  S- d(#any benefit from that relationship.B(] {Od!-ԍId. at 35.B Accordingly, Casco contends that its affiliation with Lenfest should  d(#/be disregarded and that Casco should be treated like any other operator with 17,976 subscribers, and  d(#jwhose parent owns or controls systems serving 162,620 subscribers including Casco, i.e. as a small cable  d(#.company. Such relief would permit Casco's Brunswick system to set rates in accordance with the small  d(#system costofservice rules. In support of its request, Casco describes the nature of its relationship with  d(#Lenfest. Casco states that Lenfest does not play a role in the daytoday management or operations of  d(#?either Casco or its parent, Susquehanna, nor is there any management contract, financial advisory  d(#0agreement or other arrangement whereby Lenfest advises or provides management services to the"v,`(`(883"  d(#companies. Casco also states that no Lenfest officer or representative serves as an officer of either  S- d(#kcompany, nor does Lenfest have a representative on the Casco board of directors.B(] {O@-ԍId. at 34.B Lenfest has only  S- d(#[customary shareholder voting rights in accordance with the Casco Shareholders' Agreement, with respect  d(#to major corporate events such as amendment of the Shareholders' Agreement, issuance of stock and  S`-increase in the number of directors.`Z(] {OZ- v ?ԍSee Letter from Donna C. Gregg, Counsel for Casco, to Claire Blue, Attorney, Cable Services Bureau, Federal Communications Commission, May 7, 1998 ("May 7 Letter").  S-  9.` ` In further support of the Petition, Casco argues that despite its affiliation with Lenfest it  S- d(#continues to operate under the conditions and financial hardships common to small operators.?(] yO< -ԍPetition at 4.? Casco  d(#argues that both Casco and its parent, Susquehanna, lack financial resources, economies of scale and  S- d(#purchasing advantages comparable to large companies.@D(] {O|-ԍId. at 4.@ In particular, Casco states that Lenfest has never  d(#loaned money to Casco or its parent, Susquehanna, nor has Lenfest guaranteed either company's  SH - d(#indebtedness to third parties.: H (] {O-ԍId.: The companies are not entitled to Lenfest's interest rates or terms from  S - d(#lenders.:! h (] {O(-ԍId.: Susquehanna also states that it believes origination fees and interest rates it pays for borrowing  S - d(#.are markedly higher than those paid by Lenfest or other large operators.C" (] {O-ԍId. at 45. C In addition, Casco states that  d(#Mdespite modest discounts that Casco's relationship with Lenfest has made available (Casco receives a  d(#.discount of about 1% on certain equipment purchases and annual savings of 20.2 % of Casco's regulated  d(#.basic service tier ("BST") and CPST programming costs and 10.8% of Casco's unregulated programming  d(#0costs, or a total savings of 16.5% on programming costs), neither the full purchasing resources or  S0-advantages of Lenfest are available to Casco.q#0 (] {O\-ԍId. at 5. See also May 7 Letter, Attachment at 1. q  S-   10.` ` As further testament that there is no question Casco is a small operator insofar as its  d(#subscriber base is concerned, Casco demonstrates how its Brunswick system shares relevant characteristics  S- d(#with qualifying small systems in addition to meeting the numerical definition of a small system.$(] {ON"- v ?ԍSee Letter from Donna C. Gregg, Counsel for Casco, to Claire Blue, Attorney, Cable Services Bureau, Federal Communications Commission, March 20, 1998 ("March 20 Letter"). The  Sh- d(#Brunswick system serves an average of 30 subscribers per mile, which is below the average number of  d(#35.3 subscribers per mile served by systems with fewer than 15,000 subscribers, and far below the average  d(#number of 68.7 subscribers per mile served by systems with more than 15,000 subscribers. The  d(#\Brunswick system also has a monthly regulated revenue per channel per subscriber of approximately  d(#$0.64, as compared to the $0.86 average monthly regulated revenue per channel for systems serving fewer"x$,`(`(88B"  S- d(#than 15,000 subscribers.V%(] {Oh-ԍSee March 20, 1998 Letter at 2.V Finally, the record indicates that the Brunswick system has an annual premium  d(#revenue per basic subscriber of about $36.24. This figure is lower than the average of $41.00 for systems  S- d(#with fewer than 15,000 subscribers and markedly lower than the average of $73.13 for systems with more  S-than 15,000 subscribers.^&Z(] {O-ԍSmall System Order, 10 FCC Rcd at 7408.^  S`-  S8-III.DISCUSSION  S-  } 11.` ` Based on the unopposed record before us, we believe that Casco is entitled to special relief  d(#for its Brunswick Maine system. Where a system fails to qualify for the small system definition because  d(#]it is affiliated with a large cable company, the Commission "will consider the degree to which that  d(#=affiliation exceeds our affiliation standards, and whether other attributes of the system warrant that it be  SH - d(#.treated as a small system notwithstanding the percentage ownership of the affiliate.a'H (] {O-ԍSmall System Order, 10 FCC Rcd at 741213.a Casco argues that  d(#the degree of Lenfest's interest in Casco is less than the degree of affiliation the Commission has  S - d(#previously found deserving of a waiver.2( ~(] {O- v .ԍPetition at 3; See also In the Matter of Insight Communications Company, L.P., DA 952334, 11 FCC Rcd  {O-1270 (1995) ("Insight"). Casco compares its 30% affiliation to the 34% affiliation in Insight.  2 As in Insight, we look to the "other attributes of the system"  S -to determine whether special relief should be granted.) (] {OL-ԍInsight, 11 FCC Rcd 1270 (1995).q   S -  A 12.` ` Insight owned 32 cable systems that complied with the definition of a small cable system.  SZ- d(#With respect to the definition of a small cable company, although Insight directly served a total of only  d(#about 158,000 subscribers, Continental Cablevision, Inc. ("Continental"), which served more than 3 million  S - d(#\subscribers, held a 34% ownership interest in Insight, thus in excess of the 20% standard. We noted,  S- d(#however, the Commission's pledge in the Small System Order that if a system fails to qualify for the small  d(#[system definition because it is affiliated with a cable company that serves over 400,000 subscribers, "we  d(#will consider...whether other attributes of the system warrant that it be treated as a small system  Sl-notwithstanding the percentage ownership of the affiliate."*ll (] {Ox-ԍInsight, 11 FCC Rcd at 1272 quoting Small System Order, 10 FCC Rcd at 741213.   S- 4  13.` ` Based on the record, we found that Insight gained no meaningful access to financial  S- d(#resources as a result of its affiliation with Continental. We noted that Continental had never loaned  S- d(#Insight any money and that in borrowing money from others, Continental had never guaranteed any  S- d(#indebtedness of Insight. Moreover, Insight had to pay a significantly higher origination fee and interest  S|- d(#rate than Continental could secure. We also noted that no officers or directors of Continental sat as  ST- d(#officers or directors of Insight, that Continental played no role in the daytoday management of Insight  S,- d(#and that Continental did not provide Insight with any experience or expertise regarding the raising of debt  d(#and capital, programming, budgets, mergers and acquisitions, or the disposition of property. Based on this" *,`(`(88z"  S- d(#merely "passive" relationship between Continental and Insight, we found Insight eligible for small system  S-status.[+(] {OB-ԍSee Insight, 11 FCC Rcd 1270 (1995).[  S- C 14.` ` In Casco's case, the Petition indicates that it gains no meaningful access to financial  Sb- d(#resources as a result of its affiliation with Lenfest.A,bZ(] yO\-ԍPetition at 35.A Neither Casco nor its parent, Susquehanna, have the  S:- d(#financial resources, economies of scale and purchasing advantages of large companies.E-:(] {O -ԍ  Id at 4.E Lenfest has never  d(#loaned money to Casco or Susquehanna, nor has Lenfest guaranteed either company's indebtedness to  S- d(#third parties.:.|(] {O -ԍId.: The companies are not entitled to any benefit such as Lenfest's interest rates or terms from  S- d(#lenders.?/(] {Op-ԍId at 4.? Despite modest discounts that Casco's relationship with Lenfest has made available, full  S- d(#lpurchasing resources or advantages of affiliation with a large operator are not available to Casco.@0(] {O-ԍId at 5. @  d(#Casco's apparent lack of access to the financial resources, discounts and other economic efficiencies of  SJ -larger companies make it the kind of system relief is intended for.h1J 2 (] {O-ԍSee Small System Order, 10 FCC Rcd at 7408.h  S -  ~15.` ` Further, Lenfest's interest in Casco is passive in nature. Lenfest does not play a role in  S - d(#the daytoday management or operations of either Casco or its parent, Susquehanna.Q2 (] {O6-ԍPetition at 3.Q In addition, there  d(#is no management contract, financial advisory agreement or other arrangement whereby Lenfest advises  S - d(#or provides management services to the companies.A3 V (] {Ox-ԍId at 34.A No Lenfest officer or representative serves as an  SZ- d(#officer of either company, and Lenfest has no representative on the Casco board of directors.4Z(] {O- v ԍId at 34. Casco also states there are no Lenfest systems contiguous to Casco's systems or otherwise in the state of Maine. Although  d(#[a representative of Lenfest has one of six seats on the board of directors of Casco's parent, Susquehanna,  S - d(#this does not give Lenfest any say in Casco's daytoday operations.m5 B(] {O"-ԍPetition at 4.  See also May 7 Letter at 12.m Lenfest's rights as a shareholder  S- d(#<allow Lenfest to protect its investment but do not to give Lenfest the power to run the business of Casco.X6(] {OV%-ԍSee May 7 Letter at 12.X  d(#The evidence in Casco's Petition demonstrates that despite its affiliation with Lenfest, Casco does not  d(#yreceive significant benefits that alleviate the conditions common to small operators. But for its affiliation"f6,`(`(88 "  d(#with Lenfest, Casco's subscriber base of 17,976 (14,248 in the Brunswick system, 3,728 in the Newcastle  d(#system) together with its parent Susquehanna's subscriber base of 162,620 (which includes Casco's subscriber base) would clearly establish its right to small system rate relief.  S`- 16.` ` We believe that Casco should be allowed to use the small system costofservice  d(#methodology to justify rates. Our decision here is premised on the Commission's policies and rules  d(#addressing small systems, and on the specific circumstances of this case, and not on other areas where  S- d(#attributable interests are relevant. In the Small System Order, the Commission adjusted its definition of  d(#small systems in order to further Congress' goal of reducing the regulatory burdens and cost of compliance  S- d(#for smaller cable concerns.d7(] {O -ԍSmall System Order, 10 FCC Rcd at 7395, 7406.d The Commission noted that the goals expressed by Congress in the 1992  d(#Cable Act Statement of Policy would also be furthered if it expanded the category of small systems  SJ - d(#entitled to reduced regulatory burdens.8J Z(] {OD -ԍId. at 740607, citing 1992 Cable Act, Pub. L. No. 102385, 106 Stat. 1460 (1992),  2(b)(1)(3). The Small System Order allows for the filing of petitions for  d(#]special relief so that systems that fail to meet the numerical definition of small systems or fail the  S - d(#company affiliation standard may still show that they are similar to systems that meet the definition, and  S - d(#are therefore entitled to relief.I9 (] {O`-ԍId. at 7412.I For the reasons set forth herein, we believe that granting the Petition will  S -further the intent of Congress and therefore will serve the public interest.  S\- IV.SCOPE OF THE WAIVER  S -  _17.` ` As a result of our grant of the Petition, Casco's Brunswick, Maine system shall be deemed  d(#a small system for purposes of rate regulation. Accordingly, to the extent that Casco's basic service tier  S- d(#Mand/or cable programming service tier offerings are subject to rate regulation,:f ~(] yO- v !ԍAs of the 1996 Act's enactment on February 8, 1996, rate regulation does not apply to a small cable  d(#operator with respect to CPSTs or to a BST that was the only service tier subject to regulation as of December 31,  d(#1994. For purposes of this provision, a "small cable operator" is defined as one that, directly or through an affiliate,  d(#serves in the aggregate fewer than 617,000 subscribers and is not affiliated with any entity whose gross annual  {O- d(#Lrevenues exceed $250,000,000. 47 U.S.C.  543(m); 47 C.F.R.  76.1403(b); Order and Notice of Proposed  {O- d(#Rulemaking in CS Docket No. 9685, 11 FCC Rcd 5937, 5947 (1996). As discussed above, small system relief under  d(#our rules is available only to systems that serve fewer than 15,000 subscribers and are not affiliated with a cable  {OV- d(#operator that serves more than 400,000 subscribers, absent a waiver. See supra paras. 34. Accordingly, a rate  d(#,complaint that is filed concerning a cable system that is deemed a small system under our rules may not invoke rate  d(#.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.  Casco may set rates in accordance with the small system costofservice methodology.  SD-  18.` ` 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:  ` ` X` ` To qualify for any existing form of [small system] relief, systems and  `companies must meet the new size standards as of either the effective":,`(`(88"  `date of this order or on the date thereafter when they file whatever  `documentation is necessary to elect the relief they seek, at their  `(election. $C Ԡ $C ... A system that is eligible for small system relief on either  `of the dates described above shall remain eligible for so long as the  `Gsystem has 15,000 or fewer subscribers, regardless of a change in the  `status of the company that owns the system. Thus, a qualifying system  `8will remain eligible for relief even if the company owning the system  `subsequently exceeds the 400,000 subscriber cap. Likewise, a system that  `Fqualifies shall remain eligible for relief even if it is subsequently acquired  S-by a company that serves a total of more than 400,000 subscribers.;\ {O - v ԍId. at 7413. The quoted text was discussing a system's initial and continuing eligibility for "any existing  d(#form of relief," which did not include the small system costofservice methodology. However, later in the order  {O -the Commission applied the same eligibility standards to that methodology as well. Id. at 742728.x`  SH - 2 `  19.` ` The Commission adopted this grandfathering treatment for qualifying systems to enhance  S - d(#their value "in the eyes of operators and, more importantly, lenders and investors."C< (] {O-ԍId. at 7413.C As the Commission  d(#stated: "The enhanced value of the system thus will strengthen its viability and actually increase its ability  S -to remain independent if it so chooses.":= ~(] {O-ԍId.: ` `  S - #20.` ` Upon exceeding the 15,000 subscriber threshold, a system that has established its rates in accordance with the small system costofservice methodology:  `XX` ` . . . 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.F>(] {O@-ԍId. at 742728.Fx`  S@- Q 21.` ` Casco's Brunswick system has 14,248 subscribers, and is thus approaching the 15,000  S- d(#zsubscriber threshold. We believe it is reasonable to presume that this system will continue to grow.`?(] yOZ-ԍThis system served 13,714 subscribers in 1995. `  S- d(#Thus, we must place some duration on the waiver, since the alternative would be to grant small system  d(#!status indefinitely, regardless of the eventual size of the system. This latter alternative is clearly  d(#=inconsistent with the Commission's decision to limit small system relief to systems that are in need of it due to their relatively small size.  S(-  22.` ` Therefore, as we have ordered in the context of a similar waiver situation, the Casco  S- d(#waiver will terminate two years from the date of this order, subject to the conditions set forth below.]@2 (] {O&-ԍSee Insight, 11 FCC Rcd at 1276.] " @,`(`(88k"  S- d(#During the waiver period, Casco may file only one FCC Form 1230 for each franchise area it serves.A(] yOh- v ԍAs discussed below, Casco has already filed a Form 1230 to justify its CPST rates for the franchise areas of Topsham, Bath and Brunswick, Maine.  d(#This should give Casco adequate regulatory certainty for the foreseeable future, while still ensuring that  d(#jthe system is not permitted to charge rates indefinitely under a scheme designed for smaller systems. Of  d(#course, Casco may seek continued eligibility for small system treatment by filing a petition for special relief at the end of the waiver period.  S-  23.` ` Limiting the waiver period to two years means that any Form 1230 to be filed by Casco  S- d(#jmust be submitted with the appropriate regulatory authorities within two years of the date of this order.  d(#In any franchise area where the system is currently subject to regulation, Casco may reestablish its  d(#maximum permitted rates by filing Form 1230 at any time in the next two years. Where the system is  d(#not currently subject to regulation but becomes subject to regulation within the next two years, Casco then  d(#may file Form 1230 within the normal response time. Where the system is not now subject to regulation,  d(#jand does not become subject to regulation until more than two years from now, Casco will not be eligible for small system treatment under this waiver.  S -  24.` ` After filing its initial Form 1230 and giving the required notice, Casco may set its actual  d(#yrates in the franchise area at any level that does not exceed the maximum rate, subject to the standard rate  d(#review process. Subsequent increases, not to exceed the maximum rate established by the Form 1230,  S0- d(#[shall be permitted, subject to the 30 days' notice requirement of the Commission's rules.B\0 (] {O- v ԍSmall System Order, 10 FCC Rcd at 7426. Under the small system rules, rate increases taken after the  d(#initial Form 1230 has been approved are not subject to further regulatory review, as long as the rate is no higher than  {O-that permitted by the previouslyfiled form. Id. As noted, the  d(#Lmaximum rate established by the initial Form 1230 shall be a cap on the system's rates during the waiver  d(#period. If the system reaches that cap and subsequently wishes to raise rates further, it will have to justify  d(#the rate increase in accordance with our standard benchmark or costofservice rules. Alternatively, the  d(#system can file another petition for special relief and seek continued treatment as a small system. Limiting  d(#[Casco to a single Form 1230 filing for 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.  S- V.PETITION FOR RECONSIDERATION  S-  # 25.` ` On October 27, 1997, Casco filed its petition for reconsideration against our Prior Order.  d(#In the Prior Order, we found that Casco was not eligible for small system status and, therefore, we did  d(#not review the Form 1230 that Casco had filed for its Brunswick system on November 13, 1995. Instead,  S(- d(#we reviewed Casco's justification for its CPST rates, effective September 1, 1993, as supported by its  d(#showings on FCC Form 1220 (Cost of Service) and FCC Form 1210 (Update Form). Upon review of  d(#yCasco's forms, we found that Casco had not properly calculated its maximum permitted rates ("MPRs"),  d(#beginning September 1, 1993, and we made certain adjustments resulting in revised MPRs. Because  S- d(#Casco was charging CPST rates greater than its revised MPRs, effective September 1, 1993, we ordered" DB,`(`(88"  S- d(#Casco to make refunds to its CPST subscribers.CX(] yOh- v #X\  P6G;P#эOur revised MPR, for the period September 1, 1993 through September 30, 1994, was $10.57 while Casco  d(#was actually charging a CPST rate of $11.28. Our revised MPR, for the period October 1, 1994 through the present,  yO-was $11.11 while Casco was actually charging a CPST rate of $11.69.#Xj\  P6G; 9XP# In its petition for reconsideration, Casco seeks review  d(#yof the denial of its small system status, consistent with the arguments advanced in its petition for special  d(#relief. In the alternative, Casco argues that the adjustments made to its MPRs in the Prior Order were  S- d(#Linconsistent with prior Commission orders.D$(] yO- v 1#X\  P6G;P#эSpecifically, Casco argues that the adjustments made to its Form 1220 were inconsistent with the  {O- d(#Commission's Second Report and Order, First Order on Reconsideration, and Further Notice of Proposed  {O - d(#Rulemaking, MM Docket No 93215 and CS Docket No. 9428, FCC 95502 (January 26, 1996) ("Final Cost Order").  #&a\  P6G;&P#Because we are granting Casco's petition for special relief,  d(#and giving Casco's Brunswick system small system status, we grant its petition for reconsideration, for  S8-the reasons discussed above, and vacate our Prior Order.E8(] yO - v #X\  P6G;P#эBecause we are granting Casco's petition for reconsideration based on its small system status, we do not reach Casco's alternative issues.  S-  26.` ` Our determination that Casco is entitled to small system status requires that we review the  S- d(#Form 1230 that Casco filed to justify its CPST rates.F, (] yO- v #X\  P6G;P#э In accordance with Section 76.934(h)(10) of the Commission's rules, we will consider the Form 1230 filed  d(#by Casco as an appropriate response to the CPST complaints filed against Casco in Topsham, Brunswick and Bath  d(#because a final decision on those complaints had not been issued as of June 5, 1995. 47 C.F.R. Section  d(#76.934(h)(10). Section 76.934(h)(10) states that "a decision shall not be deemed final until the operator has  {O-exhausted or is timebarred from pursuing any avenue of appeal, review, or reconsideration." Id. In order to justify its MPR on Form 1230, a cable  d(#operator must show that the Operator Selected Per Subscriber Monthly Programming Rate Per Channel  d(#(Form 1230, Line A11) does not exceed the Per Subscriber, Per Channel Monthly Programming Costs  d(#(Form 1230, Line A6) and that the Maximum Permitted Rate Per Channel (Form 1230, Line A10) does  S - d(#=not exceed $1.24.G (] {O-#X\  P6G;P#э See Instructions for Line A11, Form 1230, page 3. Upon review of Casco's Form 1230, we find that Line A11 does not exceed Line A6  S - d(#]and that Line A10 does not exceed $1.24.H p(] yO-#X\  P6G;P#э Casco's Maximum Permitted Rate per Channel (Line A10) is $0.82. Therefore, we find that Casco's CPST rate of $11.28,  d(#effective September 1, 1993 through September 30, 1994, is reasonable and that Casco's CPST rate of $11.69, effective October 1, 1994 through the present, is reasonable.  S -  SX- VI.ORDERING CLAUSES  S0-  S- 27.` ` Accordingly, IT IS ORDERED , pursuant to Section 0.321 of the Commission's rules,  d(#M47 C.F.R. Section 0.321, that the Petition for Special Relief filed by Casco Cable Television, Inc. and  S-Casco Cable Television of Bath, Maine, Inc. IS GRANTED.  Sh- 28.` ` IT IS FURTHER ORDERED , pursuant to Section 0.321 of the Commission's rules, 47  d(#C.F.R. Section 0.321, that the CPST rates of $11.28, effective September 1, 1993, and $11.69, effective  S- d(#October 1, 1994, charged by Casco Cable Television, Inc., Casco Cable Television of Bath, Maine, Inc " H,`(`(88S"  S- d(#in Topsham (CUID ME0055), Brunswick (CUID ME0057), and Bath (CUID ME0083), ARE  S-REASONABL E .  S- 29.` ` IT IS FURTHER ORDERED , pursuant to Section 1.106 of the Commission's rules, 47  d(#C.F.R. Section 1.106, that the Petition for Reconsideration of In the Matter of Casco Cable Television,  S8-Inc., Casco Cable Television of Bath, Maine, Inc., 13 FCC Rcd 6010 (1997) IS GRANTED.  S- 30.` ` IT IS FURTHER ORDERED , pursuant to Section 0.321 of the Commission's rules, 47  d(#C.F.R. Section 0.321, that In the Matter of Casco Cable Television, Inc., Casco Cable Television of Bath,  S-Maine, Inc., 13 FCC Rcd 6010 (1997) IS VACATED.  SH - 31.` ` IT IS FURTHER ORDERED , pursuant to Section 0.321 of the Commission's rules, 47  d(#C.F.R. Section 0.321, that Request for Stay of In the Matter of Casco Cable Television, Inc., Casco Cable  S -Television of Bath, Maine, Inc., 13 FCC Rcd 6010 (1997) IS DISMISSED AS MOOT.  S - $C   ` `  hhCFEDERAL COMMUNICATIONS COMMISSION ` `  hhCJohn E. Logan ` `  hhCActing Chief, Cable Services Bureau