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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 ) CUID No. TN0177 (Signal Mountain) ) Complaint 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 a complaint against the April 1, 1998 rate increase of the above- referenced operator ("Operator") for its cable programming services tier ("CPST") in the community referenced above. We have already issued an order in which we resolved prior complaints against Operator's CPST rates ("Prior Order"). Accordingly, this Order addresses only the reasonableness of Operator's April 1, 1998 CPST rate increase. 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. If the Commission finds a rate to be unreasonable, it shall determine the correct rate and any refund liability. The Telecommunications Act of 1996 ("1996 Act") and our rules implementing the new legislation ("Interim Rules"), require that complaints against the CPST rates be filed with the Commission by a local franchising authority ("LFA") that has received more than one subscriber complaint. 3. The LFA for the franchise area referenced above filed a complaint with the Commission on June 15, 1998 against Operator's April 1, 1998 CPST rate increase from $16.24 to $17.22. The LFA verified that it received more than one subscriber complaint for the franchise area and that the first valid complaint was received by the LFA on April 19, 1998. The filing of a complete and timely complaint triggers an obligation upon the cable operator to file a justification of its CPST rates. The Operator has the burden of demonstrating that the CPST rates complained about are reasonable. If the Commission finds a rate to be unreasonable, it shall determine the correct rate and any refund liability. 4. To justify rates for the period beginning May 15, 1994, operators must use the FCC Form 1200 series. Operators are permitted to make changes to their rates on a quarterly basis using FCC Form 1210. 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. 5. The Prior Order approved a maximum permitted rate ("MPR") of $17.75 for the CPST in the community referenced above. Upon review of Operator's FCC Form 1240 for the period April 1, 1997 through March 31, 1998, which updates Operator's approved MPR of $17.75, we adjusted Line 802 through Line 812 of Operator's Worksheet 8 (True-Up Rate Charged) to $17.77 to conform with Operator's actual CPST rate based on Operator's rate card. We also adjusted Operator's Inflation Factors for its true-up and projected periods. Our adjustments resulted in a revised MPR of $18.89 for the projected period April 1, 1997 through March 31, 1998. Upon review of Operator's FCC Form 1240 for the period April 1, 1998 through March 31, 1999, we adjusted Operator's Line A1 (Current Maximum Permitted Rate), Line D6 (Current True-Up Segment), Line D7 (Current Inflation Segment) and Line F8 (True-Up Segment for True-Up Period 1) to conform to the prior revised FCC Form 1240. We also adjusted Operator's Inflation Factors for its true-up and projected periods. Our revisions reduced Operator's MPR to $17.11 for the projected period April 1, 1998 through March 31, 1999. Because Operator's actual CPST rate of $17.22, effective April 1, 1998, exceeds its revised MPR, we find Operator's actual CPST rate of $17.22, effective April 1, 1998, to be unreasonable. 7. Accordingly, IT IS ORDERED, pursuant to Section 0.321 of the Commission's rules, 47 C.F.R.  0.321, that the CPST rate of $17.22, charged by Operator in the franchise area referenced above, effective April 1, 1998, IS UNREASONABLE. 8. IT IS FURTHER ORDERED, pursuant to Section 76.961 of the Commission's rules, 47 C.F.R.  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 $17.11 per month (plus franchise fees), plus interest to the date of the refund, for the period April 19, 1998 (the date of the first subscriber complaint), through the day before Operator implements the maximum permitted CPST rate of $17.11. 9. 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. 10. IT IS FURTHER ORDERED, pursuant to Section 0.321 of the Commission's rules, 47 C.F.R.  0.321, that Operator take into account our FCC Form 1240 adjustments when calculating its maximum permitted rate and performing the true-up calculation on its next FCC Form 1240. 11. IT IS FURTHER ORDERED, pursuant to Section 0.321 of the Commission's rules, 47 C.F.R. Section 0.321, that the complaint referenced herein against the rates charged by Operator in the community set forth above IS GRANTED. FEDERAL COMMUNICATIONS COMMISSION John E. Logan Deputy Chief, Cable Services Bureau