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

In the Matter of                        )   File No.  EB-02-
TC-011
                              )    CUID      No.      CA0248 
(Calabasas)         
Falcon Cablevision                 )
                              )             
Petition for Reconsideration            )


                     ORDER ON RECONSIDERATION
                                 

        Adopted: July 16, 2002                         
Released:  July 17, 2002         

By the Chief, Enforcement Bureau:1

     1. In   this   Order  we   consider   a  petition   for 
reconsideration ("Petition")  of Order, DA  98-12212 ("Prior 
Order"),  filed with  the Federal  Communications Commission 
("Commission")    by     the    above-referenced    operator 
("Operator").3  The Prior Order resolved a complaint against 
Operator's  October  1, 1997  rate  increase  for its  cable 
programming   services  tier   ("CPST")  in   the  community 
referenced above. In this Order, we deny Operator's Petition 
and calculate Operator's refund liability.

     2.   Under  the provisions  of the  Communications Act4 
that were in  effect at the time the  complaints were filed, 
the 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")5 and  the Commission's rules required the 
Commission to review  CPST rates upon the filing  of a valid 
complaint  by a  subscriber or  local franchising  authority 
("LFA").  The Telecommunications Act  of 1996 ("1996 Act"),6 
and  the  Commission's  rules implementing  the  legislation 
("Interim  Rules"),7 require  that a  complaint against  the 
CPST rate  be filed with the  Commission by an LFA  that has 
received more than one  subscriber complaint.  The filing of 
a  valid complaint  triggers  an obligation  upon the  cable 
operator to file a justification of its CPST rates.8  If the 
Commission  finds  the rate  to  be  unreasonable, it  shall 
determine the correct rate and any refund liability.9 
 
     3.   Operators  must use  the FCC  Form 1200  series to 
justify  rates  for  the period  beginning  May15,  1994.10  
Cable operators  may justify quarterly rate  increases based 
on the addition and deletion of channels, changes in certain 
external  costs and  inflation, by  filing FCC  Form 1210.11  
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.12  Any  incurred cost that is not 
projected may be accrued with interest and added to rates at 
a later time.13

     4.   In response to  the referenced complaint, Operator 
filed  its rate  justification  as  an unregulated  operator 
pursuant  the Thirteenth  Reconsideration Order.14    In the 
Thirteenth Reconsideration Order,  the Commission decided to 
end regulatory review of an operator's entire rate structure 
if no prior complaints had been filed against the operator's 
CPST rates.  An operator may  file with the Commission as an 
unregulated operator using only an  FCC Form 1240 to justify 
its current  CPST rate increase,  rather than filing  an FCC 
Form 1200  and updating that  form.  In accordance  with the 
FCC  Form 1240  Instructions the  operator should  enter, on 
Line A1  (Current Maximum  Permitted Rate)  of the  FCC Form 
1240, the  rate it was  charging prior to the  rate increase 
that triggered the complaint.15 

     5.   In its Petition, Operator  asserts that, due to an 
error it  made when  calculating its maximum  permitted rate 
("MPR") for an earlier time  period, the actual rate entered 
on Line A1 should have been higher.  Operator argues that we 
should allow  Operator to increase  its rate to  account for 
this earlier omission.  We  disagree.  The purpose of ending 
regulatory review of an operator's entire rate structure was 
to reduce  the regulatory burden on  the operator.  Operator 
took advantage  of this methodology  to avoid the  burden of 
having  the  Commission  review its  entire  rate  structure 
beginning with  its initial FCC  Form 1200 rates.  We cannot 
assume that  the actual CPST  rate that Operator  entered as 
the  starting  rate  on  its FCC  Form  1240  was  correctly 
calculated using the FCC Form  1200 as a starting point with 
the  exception of  Operator's  one claimed  error.  Had  the 
Cable  Services  Bureau   reviewed  Operator's  entire  rate 
structure, Operator  might have qualified for  an adjustment 
increasing its MPR.  On the  other hand, Operator might have 
suffered  an additional  CPST rate  reduction based  on that 
review.  Operator cannot pick and choose pieces of alternate 
rate methodologies.  If Operator chooses the advantages of a 
particular methodology over another, it must also accept any 
concomitant  consequences.   Therefore, we  deny  Operator's 
Petition. 

     6.   Because Operator never submitted  a refund plan in 
response to the Prior  Order, we calculate Operator's refund 
liability as  follows: For the  period from October  3, 1997 
(the date the first valid  complaint was filed with the LFA) 
through September  30, 1998,  we calculate an  overcharge of 
$0.96 per month per  subscriber. Operator's actual CPST rate 
for this period  was $8.41 and its MPR was  $7.45. Our total 
calculation,  including  five  percent franchise  fees  plus 
interest on the overcharges  and franchise fees through July 
31,  2002, equals  $16,760.65. We  order Operator  to refund 
this  amount, plus  any additional  interest accrued  to the 
date of  refund, to its  CPST subscribers within 60  days of 
the release of this Order.

     7.   Accordingly,  IT IS  ORDERED, pursuant  to Section 
1.106  of the  Commission's  rules, 47  C.F.R  1.106,  that 
Operator's Petition for Reconsideration IS DENIED.

     8.   IT IS FURTHER ORDERED, pursuant to Sections 0.111, 
0.311 and  76.962 of  the Commission's  rules, 47  C.F.R.  
0.111,  0.311 and  76.962,  that Operator  shall refund  to 
subscribers in the franchise area referenced above the total 
amount  of $16,760.65,  plus  any  additional interest  that 
accrues between July 31, 2002 and the date of refund, within 
60 days of the release of this Order.

     9.   IT IS FURTHER ORDERED, pursuant to Sections 0.111, 
0.311 and  76.962 of  the Commission's  rules, 47  C.F.R.  
0.111, 0.311  and 76.962, that Operator  file a certificate 
of compliance with the  Chief, Enforcement Bureau, within 90 
days of the release of  this Order certifying its compliance 
with this Order.


                              FEDERAL         COMMUNICATIONS 
COMMISSION 



                              David H. Solomon
                              Chief, Enforcement Bureau

_________________________

1 Effective March 25, 2002, the Commission transferred 
responsibility for resolving cable programming services tier 
rate complaints from the former Cable Services Bureau to the 
Enforcement Bureau.  See Establishment of the Media Bureau, 
the Wireline Competition Bureau and the Consumer and 
Governmental Affairs Bureau, Reorganization of the 
International Bureau and Other Organizational Changes, FCC 
02-10, 17 FCC Rcd 4672 (2002).

2 In the Matter of Marcus Cable Associates, DA 98-1221, 13 
FCC Rcd 17174 (CSB 1998).

3 The term "Operator" includes Operator's predecessors and 
successors in interest.

4 47 U.S.C. 543(c) (1996).

5 Pub. L. No. 102-385, 106 Stat. 1460 (1992).

6 Pub. L. No. 104-104, 110 Stat. 56 (1996).  

7 See Implementation of Cable Act Reform Provisions of the 
Telecommunications Act of 1996, 11 FCC Rcd 5937 1996).

8 See Section 76.956 of the Commission's rules, 47 C.F.R. 
76.956.

9 See Section 76.957 of the Commission's rules, 47 C.F.R. 
76.957.

10 See Section 76.922 of the Commission's Rules, 47 C.F.R.  
76.922.

11 Id.

12 Id.

13 Id.

14 See Implementation of Sections of the Cable Television 
Consumer Protection and Competition Act of 1992: Rate 
Regulation, Thirteenth Order on Reconsideration, MM Docket 
No. 92-266, 11 FCC Rcd 388 (1996).

15 FCC Form 1240 Instructions at p. 12 (July 1996).