******************************************************** 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 ) CUID Nos. NJ0162 (Livingston) ) NJ0163 (West Caldwell) Comcast Cablevision of New Jersey, Inc., ) NJ0164 (Irvington) ) NJ0165 (West Orange) Complaint Regarding ) NJ0187 (Verona) Cable Programming Services Tier ) NJ0188 (Maplewood) ) NJ0202 (Orange) ) NJ0221 (Bloomfield) ) NJ0222 (Union) ) NJ0246 (Millburn) ) NJ0247 (Roselle Park) ) NJ0248 (Roselle) ) NJ0249 (Westfield) ) NJ0261 (Summit) ) NJ0272 (Springfield) ) NJ0273 (Montclair) ) NJ0324 (New Providence) ) NJ0329 (Woodbridge) ) NJ0352 (Scotch Plains) ) NJ0354 (Rahway) ) NJ0360 (Cranford) ) NJ0378 (Garwood) ) NJ0396 (Mountainside) ) NJ0443 (South River) ) NJ0545 (Glen Ridge) ORDER Adopted: May 4, 1999 Released: May 6, 1999 By the Acting Chief, Financial Analysis and Compliance Division, Cable Services Bureau: 1. In this Order we consider a complaint against the November 1, 1998 rate increase of the above-referenced operator ("Operator") for its cable programming services tier ("CPST") in the communities referenced above. We have already issued an order in which we resolved all prior complaints against Operator's CPST rates in the communities referenced above ("Prior Order"). This Order addresses only the reasonableness of Operator's November 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. The Telecommunications Act of 1996 ("1996 Act") and our rules implementing the legislation ("Interim Rules"), require that a complaint against the CPST rate 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 areas referenced above filed a complaint with the Commission on March 3, 1999 against Operator's November 1, 1998 CPST rate increase from $14.27 to $15.26 and ValuePac increase from $3.87 to $5.28. The LFA verified that it received more than one subscriber complaint for each franchise area and that the first valid complaint for each franchise area was received by the LFA on the date listed in Appendix A attached hereto. 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 justify 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. On October 10, 1997, we issued an Order approving a Social Contract which Operator entered into with the Commission ("Social Contract"). Under the terms of the Social Contract, Operator may migrate up to four existing channels from its CPST to a migrated product tier ("MPT") so long as the system has a capacity of at least 550 MHz and offers service on at least 55 channels that are subject to regulation on or before March 31, 1999. On or after January 1, 1998, Operator may convert the MPT to a new product tier ("NPT"). On January 1, 1998, Operator moved four channels from its CPST to create its ValuePac. We find that Operator created its ValuePac tier in accordance with the Social Contract and it may be treated as an NPT. Operator may set the price for an NPT as it elects. Therefore, we do not review the November 1, 1998 rate increase for the ValuePac tier. 6. Upon review of Operator's FCC Form 1240, for the projected period November 1, 1998 through October 31, 1999, we find Operator's actual CPST rate of $15.26, effective November 1, 1998, to be reasonable. 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 $15.26, charged by Operator in the franchise areas referenced above, effective November 1, 1998, IS REASONABLE. 8. IT IS FURTHER ORDERED, pursuant to Section 0.32l of the Commission's rules, 47 C.F.R. 0.321, that the complaint referenced herein, against the CPST rate charged by Operator in the communities referenced above, IS DENIED. FEDERAL COMMUNICATIONS COMMISSION Patrick A. Boateng Acting Chief, Financial Analysis and Compliance Division Cable Services Bureau APPENDIX A CUID NO. COMMUNITY DATE FIRST VALID COMPLAINT FILED WITH LFA NJ0162 Livingston 12/29/98 NJ0163 West Caldwell 11/20/98 NJ0164 Irvington 11/10/98 NJ0165 West Orange 11/6/98 NJ0187 Verona 11/2/98 NJ0188 Maplewood 12/21/98 NJ0202 Orange 12/7/98 NJ0221 Bloomfield 1/20/98 NJ0222 Union 11/19/98 NJ0246 Millburn 11/4/98 NJ0247 Roselle Park 11/25/98 NJ0248 Roselle 12/28/98 NJ0249 Westfield 11/17/98 NJ0261 Summit 11/19/98 NJ0272 Springfield 11/9/98 NJ0273 Montclair 11/5/98 NJ0324 New Providence 11/10/98 NJ0329 Woodbridge 11/2/98 NJ0352 Scotch Plains 11/6/98 NJ0354 Rahway 11/20/98 NJ0360 Cranford 11/20/98 NJ0378 Garwood 12/22/98 NJ0396 Mountainside 11/23/98 NJ0443 South River 1/6/99 NJ0545 Glen Ridge 11/9/98