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

In the Matter of                )
                                )
Project Services, Inc.          )    File No. EB-02-TS-080
                                )
Operator of Cable Systems in:   )
                                )    
Hanley Falls, Minnesota         )
Lake Lillian, Minnesota         )
Raymond, Minnesota              )
Watson, Minnesota               )
                                )
Request for Waiver of Section 11.11(a) of the     )    
Commission's Rules              )    
                                        
                              ORDER 

Adopted:  May 29, 2002                  Released:  May 31, 2002

By the Chief, Technical  and Public Safety Division,  Enforcement 
Bureau:

1.        In  this  Order,  we   grant  Project  Services,   Inc. 
  (``Project Services'')  temporary, 36-month waivers of  Section 
  11.11(a) of  the Commission's  Rules (``Rules'')  for the  four 
  above-captioned  cable television  systems.   Section  11.11(a) 
  requires  cable systems  serving fewer  than 5,000  subscribers 
  from  a headend  to  either provide  national  level  Emergency 
  Alert System (``EAS'')  messages on all programmed channels  or 
  install EAS equipment  and provide a video interrupt and  audio 
  alert  on all  programmed  channels  and EAS  audio  and  video 
  messages  on at  least one  programmed  channel by  October  1, 
  2002.1

2.        The Cable Act of 1992  added new Section 624(g) to  the 
  Communications  Act  of 1934  (``Act''),  which  requires  that 
  cable  systems be  capable of  providing  EAS alerts  to  their 
  subscribers.2  In 1994, the Commission adopted rules  requiring 
  cable systems to participate in EAS.3  In 1997, the  Commission 
  amended the  EAS rules  to provide financial  relief for  small 
  cable systems.4  The Commission declined to exempt small  cable 
  systems  from the  EAS requirements,  concluding that  such  an 
  exemption would be  inconsistent with the statutory mandate  of 
  Section  624(g).5    However,  the   Commission  extended   the 
  deadline   for  cable   systems  serving   fewer  than   10,000 
  subscribers to  begin complying with the  EAS rules to  October 
  1, 2002,  and provided cable systems  serving fewer than  5,000 
  subscribers the option  of either providing national level  EAS 
  messages  on   all  programmed  channels   or  installing   EAS 
  equipment and  providing a video interrupt  and audio alert  on 
  all programmed channels and EAS audio and video messages on  at 
  least  one programmed  channel.6  In  addition, the  Commission 
  stated that  it would grant waivers of  the EAS rules to  small 
  cable  systems  on  a case-by-case  basis  upon  a  showing  of 
  financial  hardship.7   The Commission  indicated  that  waiver 
  requests must contain at least the following information:   (1) 
  justification for the waiver, with reference to the  particular 
  rule sections  for which  a waiver is  sought; (2)  information 
  about the financial status of the requesting entity, such as  a 
  balance sheet and  income statement for the two previous  years 
  (audited, if possible);  (3) the number of other entities  that 
  serve the  requesting entity's coverage area  and that have  or 
  are expected to  install EAS equipment; and (4) the  likelihood 
  (such  as proximity  or frequency)  of hazardous  risks to  the 
  requesting entity's audience.8

3.        Project Services  filed a  request for  temporary,  36-
  month waivers of Section 11.11(a) for the four captioned  cable 
  system  on  February  27,  2002.   In  support  of  its  waiver 
  request, Project  Services states that  these are small,  rural 
  cable   systems   which  together   serve   approximately   555 
  subscribers,   with  two   systems  serving   fewer  than   100 
  subscribers.   Based  on  a price  quote  provided  by  an  EAS 
  equipment  manufacturer,  Project Services  estimates  that  it 
  would cost  approximately $9,579  to install  EAS equipment  at 
  each of  these systems for  a total cost  of $38,316.   Project 
  Services  asserts that  this  cost will  impose  a  substantial 
  financial hardship on it and provides its financial  statements 
  for 2000 and 2001  in support of this assertion.  In  addition, 
  Project Services submits that its subscribers will continue  to 
  have  ready  access to  national  EAS  information  from  other 
  sources, including its cable systems.  In this regard,  Project 
  Services notes  that its subscribers  currently have access  to 
  national EAS messages  on approximately half of all  programmed 
  channels.  Project Services  also asserts that its  subscribers 
  will  have  access  to  EAS  information  through  over-the-air 
  reception   of  broadcast   television  and   radio   stations.  
  Moreover, Project Services states that each of the  communities 
  served  by  these  systems  operates  an  emergency  siren  for 
  alerting  residents and  that, given  the small  size of  these 
  communities,  a  central siren  is  sufficient  to  notify  the 
  entire town.  Finally,  Project Services believes that it  will 
  be able to fund EAS equipment for the four systems in the  next 
  three years.

4.        Based upon our review of  the financial data and  other 
  information  submitted by  Project Services,  we conclude  that 
  temporary, 36-month  waivers of Section  11.11(a) for the  four 
  captioned systems are warranted.9  In particular, we find  that 
  the estimated  $38,316 cost  of EAS equipment  for these  small 
  cable  systems could  impose a  financial hardship  on  Project 
  Services.  

5.        We note that  the Commission recently  amended the  EAS 
  rules  to  permit  cable  systems  serving  fewer  than   5,000 
  subscribers  to   install  FCC-certified  decoder-only   units, 
  rather  than both  encoders  and  decoders, if  such  a  device 
  becomes  available.10    Based  on   comments  from   equipment 
  manufacturers, we  anticipate that such  a decoder-only  system 
  could  result  in  significant  cost  savings  to  small  cable 
  systems.11  

6.        Accordingly, IT IS ORDERED  that, pursuant to  Sections 
  0.111, 0.204(b)  and 0.311  of the  Rules,12 Project  Services, 
  Inc. IS GRANTED waivers of Section 11.11(a) of the Rules  until 
  October  1,  2005  for  the  four  captioned  cable  television 
  systems.

7.        IT IS FURTHER ORDERED that Project Services, Inc. place 
  a copy of this waiver in its system files.

8.        IT IS FURTHER ORDERED that  a copy of this Order  shall 
  be sent by  Certified Mail Return Receipt Requested to  counsel 
  for  Project Services,  Inc.,  Christopher C.  Cinnamon,  Esq., 
  Cinnamon  Mueller,  307  North  Michigan  Avenue,  Suite  1020, 
  Chicago, Illinois 60601.

                         FEDERAL COMMUNICATIONS COMMISSION
                         


                         Joseph P. Casey
                         Chief, Technical and Public Safety 
Division
                         Enforcement Bureau
_________________________

  1 47 C.F.R.  11.11(a).

  2 Cable Television  Consumer Protection and Competition Act  of 
1992, Pub. L. No. 102-385,  16(b), 106 Stat. 1460, 1490  (1992).  
Section 624(g) provides that  ``each cable operator shall  comply 
with such standards as the  Commission shall prescribe to  ensure 
that viewers of video programming  on cable systems are  afforded 
the same emergency  information as is  afforded by the  emergency 
broadcasting system pursuant to Commission regulations ....''  47 
U.S.C.  544(g).  

  3 Amendment  of Part 73, Subpart  G, of the Commission's  Rules 
Regarding the Emergency  Broadcast System, Report  and Order  and 
Further Notice of Proposed Rule Making, FO Docket Nos. 91-171/91-
301, 10  FCC  Rcd  1786  (1994)  (``First  Report  and  Order''), 
reconsideration granted in part, denied in part, 10 FCC Rcd 11494 
(1995).

  4 Amendment  of Part 73, Subpart  G, of the Commission's  Rules 
Regarding the  Emergency  Broadcast  System,  Second  Report  and 
Order, FO  Docket Nos.  91-171/91-301, 12  FCC Rcd  15503  (1997) 
(``Second Report and Order'').

  5 Id. at 15512-13.

  6 Id. at 15516-15518.

  7 Id. at 15513.

  8 Id. at 15513, n. 59.

  9 The waivers for  the four systems will extend 36 months  from 
October 1, 2002,  until October 1,  2005.  Project Services  also 
specifically requested  waiver  of  the  testing  and  monitoring 
requirements of the EAS rules for these four systems.  We clarify 
that the waivers we are  granting also encompass the EAS  testing 
and monitoring requirements.  

  10 Amendment  of Part  11 of the  Commission's Rules  Regarding 
the Emergency Alert System,  EB Docket 01-66, FCC  02-64 at   71 
(released February 26, 2002).

  11 One manufacturer  estimated that an EAS decoder-only  system 
can reduce the cost by 64% over what a cable operator would spend 
for an encoder/decoder unit.  Id. at  70.

  12 47 C.F.R.  0.111, 0.204(b) and 0.311.