******************************************************** NOTICE ******************************************************** This document was converted from WordPerfect to ASCII Text format. Content from the original version of the document such as headers, footers, footnotes, endnotes, graphics, and page numbers will not show up in this text version. All text attributes such as bold, italic, underlining, etc. from the original document will not show up in this text version. Features of the original document layout such as columns, tables, line and letter spacing, pagination, and margins will not be preserved in the text version. If you need the complete document, download the WordPerfect version or Adobe Acrobat version, if available. ***************************************************************** Before the Federal Communications Commission Washington, D.C. 20554 In the Matter of ) ) Comcast Cablevision of Carolina, Inc.) CUID No. SC0141 (Mt. Pleasant) ) ) Complaints Regarding ) Cable Programming Services Tier Rates) ORDER Adopted: August 31, 1998 Released: September 4, 1998 By the Deputy Chief, Cable Services Bureau: 1. In this Order we consider complaints concerning the rates of the above-captioned operator ("Operator") for its cable programming services tier ("CPST") in the community referenced above. Operator's response includes benchmark justifications filed on FCC Forms 1200, 1210 and 1240. This Order addresses the reasonableness of Operator's rates for the period beginning March 7, 1995, as justified on Operator's FCC Forms 1200, 1210 and 1240. 2. Under the Communications Act, the Federal Communications Commission ("Commission") is authorized to review the CPST rates of cable systems not subject to effective competition to ensure that rates charged are not unreasonable. The Cable Television Consumer Protection and Competition Act of 1992 ("1992 Cable Act"), and our rules in effect at the time the complaints were filed, required the Commission to review CPST rates upon the filing of a valid complaint by a subscriber. The filing of a valid complaint triggers an obligation on behalf of the cable operator to file a justification of its CPST rates. If the Commission finds the rate to be unreasonable, it shall determine the correct rate and any refund liability. 3. The Commission's original rate regulations took effect on September 1, 1993. The Commission subsequently revised its rate regulations effective May 15, 1994. Cable operators with valid CPST complaints filed against them prior to May 15, 1994 must demonstrate that their CPST rates were in compliance with the Commission's initial rules from the time the complaint was filed through May 14, 1994, and that their rates were in compliance with the revised rules from May 15, 1994 forward. Cable operators attempting to justify their rates for the period prior to May 15, 1994 using a benchmark showing must complete and file FCC Form 393. Operators must use the FCC Form 1200 series to justify their rates for the period beginning May 15, 1994 using a benchmark showing. Cable operators may also justify rate increases based on the addition and deletion of channels, changes in certain external costs, and inflation, by filing FCC Form 1210. FCC Form 1210 must be filed at least 30 days before new rates are scheduled to go into effect where the Commission has found the cable programming service rate to be unreasonable less than one year prior to the filing, or where there is a pending complaint against the CPST rate. Operators may alternatively justify adjustments to their rates on an annual basis using FCC Form 1240 to reflect reasonably certain and quantifiable changes in external costs, inflation, and the number of regulated channels that are projected for the twelve months following the rate change. Any incurred cost that is not projected may be accrued with interest and added to rates at a later time. 4. Upon review of Operator's FCC Form 1200, we find that Operator has justified its maximum permitted rate ("MPR") of $16.92. Upon review of Operator's FCC Form 1210 covering the period April 1, 1994 to December 31, 1994, we adjusted Module A, Line A2 (Permitted Charge) to reflect the MPR from Operator's prior FCC Form 1200, Line J6 (Full Reduction Rate). This adjustment resulted in a revised MPR of $18.31 instead of $19.23. Because Operator's actual CPST rate of $18.21 does not exceed its revised MPR of $18.31, we find Operator's actual CPST rate of $18.21, effective March 7, 1995 to be reasonable. 5. Upon review of Operator's FCC Form 1210 covering the period January 1, 1995 to September 30, 1995 we adjusted Module A, Line A2 (Permitted Charge) to reflect the corrected MPR from Operator's prior FCC Form 1210. This adjustment reduced Operator's MPR from $20.45 to $19.50. Because Operator's actual CPST rate of $19.39 does not exceed its revised MPR of $19.50, we find Operator's actual CPST rate of $19.39, effective November 1, 1995, to be reasonable. 6. Upon review of Operator's FCC Form 1210 covering the period October 1, 1995 to December 31, 1995, we adjusted Module A, Line A2 (Permitted Charge) to reflect the MPR from Operator's prior FCC Form 1210. This adjustment reduced Operator's MPR from $20.94 to $20.00. Because Operator's actual CPST rate of $20.97 exceeds its revised MPR of $20.00, we find Operator's actual CPST rate of $20.97, effective January 1, 1996 to October 31, 1996, to be unreasonable. 7. Upon review of Operator's FCC Form 1240 for the Projected Period November 1, 1996 to October 31, 1997, we adjusted Module A, Line A1 (Current Maximum Permitted Rate) to reflect the MPR from Operator's prior FCC Form 1210. We also adjusted Module C, Line C1 (Inflation Factor For True-Up Period 1), Worksheet 1, to 1.0246, Line C2 (Inflation Factor For True-Up Period 2) to 1.0052 and Line C3 (Current FCC Inflation Factor) to 1.0183. These adjustments reduced Operator's MPR in Module I, Line I9 (Max Permitted Rate for Projected Period) from $22.73 to $21.10. Because Operator's actual CPST rate of $22.68 exceeds its reduced MPR of $21.10, we find Operator's actual CPST rate of $22.68, effective November 1, 1996 to October 31, 1997, to be unreasonable. 8. Upon review of Operator's FCC Form 1240 for the Projected Period November 1, 1997 to October 31, 1998, we adjusted Module A, Line A1 (Current Maximum Permitted Rate) to reflect Operator's prior FCC form 1240, Module I, Line I9 (Max Permitted Rate for Projected Period). We also adjusted Module C, Line C1 (Inflation Factor For True-Up Period 1[Wks 1] ) to 1.0206 and Line C3 (Current FCC Inflation Factor) to 1.0143. Furthermore, Module D, Line D6 (Current True-Up Segment) was adjusted to match Module I, Line I8 (True-Up Segment For Projected Period) of our prior revised FCC Form 1240 and Line D7 (Current Inflation Segment) was adjusted to match Line I5 (Inflation Segment for Projected Period) of our prior revised FCC Form 1240. These adjustments reduced Operator's MPR from $23.95 to $20.61. Because Operator's actual CPST rate of $23.46 exceeds its reduced MPR of $20.61, we find Operator's actual CPST rate of $23.46, effective November 1, 1997, to be unreasonable. 9. Accordingly, IT IS ORDERED, pursuant to Section 0.32l of the Commission's rules, 47 C.F.R. Section 0.321 that Operator's CPST rate of $18.21, effective March 7, 1995 to October 31, 1995, in the community set forth above, IS REASONABLE. 10. IT IS FURTHER ORDERED, pursuant to Section 0.32l of the Commission's rules, 47 C.F.R. Section 0.321 that Operator's CPST rate of $19.39, effective November 1, 1995 to December 31, 1995 in the community set forth above, IS REASONABLE. 11. IT IS FURTHER ORDERED, pursuant to Section 0.32l of the Commission's rules, 47 C.F.R. Section 0.321 that Operator's CPST rate of $20.97, effective January 1, 1996 to October 31, 1996, in the community set forth above, IS UNREASONABLE. 12. IT IS FURTHER ORDERED, pursuant to Section 0.32l of the Commission's rules, 47 C.F.R. Section 0.321 that Operator's CPST rate of $22.68, effective November 1, 1996 to October 31, 1997, in the community set forth above, IS UNREASONABLE. 13. IT IS FURTHER ORDERED, pursuant to Section 0.32l of the Commission's rules, 47 C.F.R. Section 0.321 that Operator's CPST rate of $23.46, effective November 1, 1997, in the community set forth above, IS UNREASONABLE. 14. IT IS FURTHER ORDERED, pursuant to Section 76.961 of the Commission's rules, 47 C.F.R. Section 76.961, that Operator shall refund to subscribers in the franchise area referenced above that portion of the amount paid in excess of the maximum permitted CPST rate of $20.61 per month (plus franchise fees), plus interest to the date of the refund, for the period November 1, 1997 to the day before Operator implements the maximum permitted CPST rate of $20.61. 15. IT IS FURTHER ORDERED that Operator shall promptly determine the overcharges to CPST subscribers for the stated periods, and shall within 30 days of the release of this Order, file a report with the Chief, Cable Services Bureau, stating the cumulative refund amount so determined (including franchise fees and interest), describing the calculation thereof, and describing its plan to implement the refund within 60 days of Commission approval of the plan. 16. IT IS FURTHER ORDERED, pursuant to Section 0.32l of the Commission's rules, 47 C.F.R. Section 0.321, that the complaints referenced herein against the rates charged by Operator in the community set forth above ARE GRANTED. 17. IT IS FURTHER ORDERED, pursuant to Section 0.321 of the Commission's rules, 47 C.F.R. Section 0.321, that Operator revise the calculation of its maximum permitted CPST rate in its next FCC Form 1240 filing in accordance with our findings in this order. FEDERAL COMMUNICATIONS COMMISSION John E. Logan Deputy Chief, Cable Services Bureau