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                                                                                                                   Before the
                     Federal Communications Commission
                          Washington, D.C. 20554


In the Matter of:                    )
                                     )
JACKSON UTILITY DIVISION             )
                                     )
Certification to Operate an          )
Open Video System                    )                 


                       MEMORANDUM OPINION AND ORDER

        Adopted:  July 24, 1998                    Released:  July 24, 1998 

By the Deputy Chief, Cable Services Bureau:

I.      INTRODUCTION

  1.    Jackson Utility Division, the City of Jackson, Tennessee ("JUD"), filed an Application
for Certification for Open Video System (FCC Form 1275) ("Application") on July 15, 1998, pursuant to
Section 653(a)(1) of the Communications Act of 1934 ("Communications Act") and the Commission's
regulations.  JUD seeks to operate an open video system in two Tennessee areas: Jackson and portions
of Madison County.  In accordance with our regulations, we issued a Public Notice acknowledging receipt
of JUD's Application and setting forth the comment period, which was released and posted on the Internet
on July 15, 1998.  Renaissance Media, LLC ("Renaissance") and the Tennessee Cable
Telecommunications Association ("TCTA") filed comments in opposition to JUD's Application.

  2.     Pursuant to Section 653(a)(1) of the Communications Act, any person may obtain
certification to operate an open video system.  In light of the brief period (ten days) for  Commission
review of certification filings, the Commission concluded that Congress intended a streamlined certification
process.  Prospective open video system operators may apply for certification at any point prior to the
commencement of service, subject to two conditions.  If construction of new physical plant is required,
the applicant must obtain Commission approval of its certification prior to the commencement of
construction.  If no new construction is required, the applicant must obtain certification prior to the
commencement of service, allowing itself sufficient time to comply with the Commission's requirements
regarding notifications that must be provided to potential programming providers.

  3.     Despite the streamlined nature of the certification process, the Commission intended it to
provide purposeful representations regarding the responsibilities of the open video system operator by
requiring that applicants verify their certifications and provide specified information.  To obtain
certification, an applicant must file FCC Form 1275, which requires, among other things:  (a) a statement
of ownership, including a list of all affiliated entities; (b) a representation that the applicant will comply
with the Commission's regulations under Section 653(b); (c) a list of the names of the communities the
applicant anticipates it will serve; (d) a statement of the anticipated type and amount of channel capacity
that the system will provide; and (e) a representation as to whether the applicant is a cable operator
applying for certification within its cable franchise area.    

II.      OPPOSITIONS

  4.     Renaissance and TCTA urge us not to approve JUD's Application for two reasons: (1)
under Tennessee law, JUD is prohibited from offering cable services; and (2) the Commission's
regulations do not authorize a governmental entity to provide open video system service.  Renaissance
and TCTA also point to certain conflicts of interest that could arise should we certify JUD as an open
video system operator.  For example, disputes regarding public, educational, and governmental channel
access and availability normally are resolved by a franchising authority, which in this case would be the
City of Jackson--the sole owner of JUD's assets.

III.     DISCUSSION

  6.      We have reviewed JUD's Application.  As required by FCC Form 1275, JUD's
Application provides: company information and a separate statement of ownership; eligibility and
compliance representations; and system information, system capacity, and verification statements.  JUD's
certificate of service represents that it served its Application on the Commission's Office of the Secretary,
the Cable Service Bureau's Office of the Bureau Chief, and on the designated telecommunications officials
of the communities affected by its Application.

  7.     The ten day statutorily mandated review period for open video system certification
applications requires us to confine our review.  The purpose of the open video system certification process
is to determine whether JUD's Application complies with Congress' mandate and our regulations.

  8.     Renaissance and TCTA cite Tennessee law and argue that JUD, a public utility chartered
by Tennessee, is prohibited from operating a cable system or providing cable service.  Section 7-52-406
of the Tennessee Code provides that:

  Nothing in this part . . . shall allow a municipality, county, metropolitan charter,
  government, department, board, or other entity of local government to provide any service
  for which a license, certification, or registration is required under title 62, chapter 32, part
  3, to operate a cable system, as defined by  7-59-201(2), for the provision of cable
  services, to provide pager service, or to operate as an internet service provider.

Tennessee's statutory definition of the term "cable service" is, in pertinent part, identical to the definition
of that term as enacted by Congress in the Communications Act, and provides that cable service means:

                (A) The one-way transmission to subscribers of video
         programming or other programming service; and
         
  (B)  Subscriber interaction, if any, which is required for the selection of
  such video programming or other programming service. . . .

The Commission's definition of the term "open video system" expressly contemplates the provision of
cable service, which includes video programming, to multiple subscribers within a community. 
Renaissance and TCTA have raised a valid concern whether JUD, a government entity created pursuant
to state statute and under state law restricted from engaging in particular activities, is authorized to provide
open video service under Tennessee law.  JUD's open video system certification application fails to
address these substantial issues.

  9.     The Commission has discussed the necessity that open video system applicants inform the
Commission fully regarding information that could be material in determining whether such applicant is
eligible to be certified as an open video system operator.  The Commission has stated that it is the duty
of the open video system applicant "to come forward with a candid statement of relevant facts, whether
or not such information is particularly elicited by the Commission."  Given the apparent restrictions
contained in Section 7-52-406 of the Tennessee Code, and the issues this provision raises, JUD, in its
Application, failed to bring material information concerning its eligibility to operate an open video system
to the Commission's attention to resolve the issues raised. 

  10.    In reviewing this Application, we are presented with a record that casts reasonable doubt
on JUD's eligibility to operate an open video system.  JUD is an entity created by the State of Tennessee. 
Another Tennessee statutory provision appears to prevent utilities, such as JUD, from providing the service
in which it seeks to engage.  Whether Tennessee law operates, as asserted by TCTA and Renaissance,
to preclude JUD from offering service as an open video system operator is a question not resolved by
JUD's Application.  

  11.    For the certification process to provide meaningful representations, we must be satisfied
that under the law an applicant is authorized to provide service.  That question remains unresolved here. 
Because the record is unclear regarding the eligibility of JUD to operate an open video system, we must
construe the circumstances in the light least favorable to the applicant and deny JUD's open video system
certification application.  Such denial is without prejudice to refiling by JUD after it has resolved the
issue of its authority under Tennessee law to provide cable service as an open video system operator. 

IV.      ORDERING CLAUSES

  12.    Accordingly, IT IS ORDERED that the certification application of Jackson Utility
Division, the City of Jackson, Tennessee, IS DENIED.

  13.    This action is taken by the Deputy Chief, Cable Services Bureau, pursuant to the authority
delegated by Section 0.321 of the Commission's rules.


  FEDERAL COMMUNICATIONS COMMISSION 
  


  John E. Logan, Deputy Chief
  Cable Services Bureau