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


In the Matter of                        )   File No.  EB-02-
TC-028
                              )    CUID      No.      TN0062 
(Chattanooga)       
Chattanooga Cable TV Company       )
                              )             
Petition for Reconsideration            )


                     ORDER ON RECONSIDERATION
                                 

        Adopted:    September 30, 2002                 
Released:  October 1, 2002       

By the Chief, Enforcement Bureau:1

     1. In   this   Order  we   consider   a  petition   for 
reconsideration ("Petition")  and request for stay  of Cable 
Services  Bureau Order,  DA 96-5452  ("Prior Order"),  filed 
with the Federal Communications Commission ("Commission") by 
the  above-referenced  operator  ("Operator").3   The  Prior 
Order resolved complaints filed against the rates charged by 
Operator for its cable programming services tier ("CPST") in 
the community referenced above through May14, 1994.  In the 
Prior  Order,  the Cable  Services  Bureau  stated that  its 
findings "do not  in any way prejudge  the reasonableness of 
the price for  CPS service after May 14, 1994  under our new 
rate regulations."4   In this  Order we  modify, on  our own 
motion,  the Prior  Order, dismiss  Operator's Petition  and 
request  for   stay  and   address  the   reasonableness  of 
Operator's CPST rates beginning May 15, 1994.

     2.   Under  the provisions  of the  Communications Act5 
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")6 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"),7 
and  the  Commission's  rules implementing  the  legislation 
("Interim Rules"),8  required 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.9  If the 
Commission  finds  the rate  to  be  unreasonable, it  shall 
determine the correct rate and any refund liability.10 

     3.   During the  first phase  of rate  regulation, from 
September 1,  1993 until  May 15,  1994, the  benchmark rate 
analysis and comparison with an operator's actual rates were 
calculated using the FCC  Form 393.11  The benchmark formula 
was  revised,  effective  May  15, 1994.12    Systems  first 
becoming subject to rate regulation  after May 15, 1994 were 
required  to justify  their  initial  regulated rates  using 
forms in the  FCC Form 1200 series.13  Systems against which 
rate  complaints  were  still pending  when  the  Commission 
revised its  benchmark formula were required  to recalculate 
their benchmark rates as of May  15, 1994 using the FCC Form 
1200.14  The   Commission's  rules  provide  for   a  refund 
liability deferral period, if  timely requested by Operator, 
beginning May  15, 1994  and ending July  14, 1994,  for any 
overcharges resulting  from Operator's calculation of  a new 
maximum  permitted rate  on the  FCC Form  1200.15  However, 
Operator  will  incur refund  liability  from  May 15,  1994 
through July 14, 1994 (or the date Operator restructures its 
rates, if sooner)  for any CPST rates charged  above the FCC 
Form 393 MPR approved by the Commission.16

     4.   Operators  may file  an FCC  Form 1210  to justify 
quarterly rate increases based  on the addition and deletion 
of  channels,   changes  in   certain  external   costs  and 
inflation.17  Operators may justify their rates on an annual 
basis using an  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.18  Any  incurred 
cost that is not projected  may be accrued with interest and 
added to rates at a later time.19
 
     5.   Our  review  of the  Prior  order  and the  record 
herein indicates that the total overcharges for the FCC Form 
393 period covered by the Prior  Order are de minimis and it 
would not be in the public  interest to order the payment of 
refunds.  We therefore modify the Prior Order to exclude any 
refund  liability.   It would  not  be  a judicious  use  of 
Commission resources  to attempt to resolve  appeals of CPST 
rate orders  that had no  adverse affect on  the petitioner, 
either because the order found no refund liability at all or 
found a  de minimis liability  that did not later  result in 
the   petitioner   incurring    actual   refund   liability.  
Resolution of  such appeals will have  no consequences other 
than  to   put  additional  strain  on   limited  Commission 
resources  which   are  better   used  to   resolve  pending 
complaints and  appeals of orders that  involve potential or 
actual  refund  liability.   Therefore, the  Cable  Services 
Bureau determined that  appeals of CPST rate  orders that do 
not  involve  actual  refund  liability  will  be  dismissed 
because there is no real  relief that may be granted through 
resolution  of  the  appeal.20  Because  our  resolution  of 
Operator's  Petition  would  have no  effect  on  Operator's 
refund liability, we decline to address the issues raised by 
Operator and we dismiss  Operator's Petition and request for 
stay.

     6.   Upon review of Operator's FCC Form 1200, we accept 
Operator's  calculated  maximum  permitted rate  ("MPR")  of 
$13.96.21  Because  Operator's actual  CPST rate  of $14.30, 
effective July 15, 199422 through December 31, 1994, exceeds 
it calculated  MPR, we find  Operator's actual CPST  rate of 
$14.30, effective  July 15, 1994 through  December 31, 1994, 
to  be unreasonable.   Upon  review of  Operator's FCC  Form 
1210, covering the period April 1, 1994 through December 31, 
1994,  we  find  Operator's  actual  CPST  rate  of  $14.30, 
effective January 1,  1995, to be reasonable.   We also find 
Operator's actual CPST rate of $16.06, effective February 1, 
1995, to be reasonable.  

     7.   Accordingly,  IT IS  ORDERED, pursuant  to Section 
1.106 of the Commission's rules, 47 C.F.R.  1.106, that the 
petition for  reconsideration and request for  stay filed by 
Operator ARE DISMISSED. 

     8.   IT IS  FURTHER ORDERED, pursuant to  Section 1.106 
of the  Commission's rules, 47  C.F.R.  1.106, that  In the 
Matter of  Triax Midwest Associates,  DA 96-545, 11  FCC Rcd 
4778 (CSB 1996) IS MODIFIED TO THE EXTENT INDICATED HEREIN.

     9.   IT IS FURTHER ORDERED,  pursuant to Sections 0.111 
and 0.311 of the Commission's  rules, 47 C.F.R.  0.111 and 
0.311, that the CPST rate  of $14.30, charged by Operator in 
the  community referenced  above,  effective  July 15,  1994 
December 31, 1994, IS UNREASONABLE.

     10.  IT IS FURTHER ORDERED,  pursuant to Sections 0.111 
and 0.311 of the Commission's  rules, 47 C.F.R.  0.111 and 
0.311,  that  the CPST  rates  charged  by Operator  in  the 
community referenced  above, effective January 1,  1995, ARE 
REASONABLE.

     11.  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 community  referenced 
above  that portion  of the  amount  paid in  excess of  the 
maximum  permitted  CPST  rate  of $13.96  per  month  (plus 
franchise fees),  plus interest to  the date of  the refund, 
for the period July 15, 1994, through December 31, 1994.

     12.  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,  Enforcement 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.

     13.  IT IS FURTHER ORDERED,  pursuant to Sections 0.111 
and 0.311 of the Commission's  rules, 47 C.F.R.  0.111 and 
0.311,  that the  complaints referenced  herein against  the 
CPST rates  charged by Operator in  the community referenced 
above ARE GRANTED TO THE EXTENT INDICATED HEREIN.



                              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  Chattanooga Cable TV Company, DA 96-545, 
11 FCC Rcd 4778 (CSB 1996).

3  The term  "Operator" includes  Operator's successors  and 
predecessors in interest.
4 Prior Order at n. 1.
5 47 U.S.C. 543(c) (1996).
6 Pub. L. No. 102-385, 106 Stat. 1460 (1992).
7 Pub. L. No. 104-104, 110 Stat. 56 (1996).  
8 See Implementation  of Cable Act Reform  Provisions of the 
Telecommunications Act of 1996, 11 FCC Rcd 5937 1996).
9 See  Section 76.956 of  the Commission's rules,  47 C.F.R. 
76.956.
10 See Section  76.957 of the Commission's  rules, 47 C.F.R. 
76.957.
11 See  Implementation of  Sections of the  Cable Television 
Consumer  Protection  and  Competition  Act  of  1992:  Rate 
Regulation,  8  FCC  Rcd  5631,  5755-56,  5766-67,  5881-83 
(1993). 
12 See  Implementation of  Sections of the  Cable Television 
Consumer  Protection  and  Competition  Act  of  1992:  Rate 
Regulation, 9 FCC Rcd 4119 (1994).
13 See Section 76.922 of the Commission's rules, 47 C.F.R.  
76.922.
14 Id.
15 See 47 C.F.R.  76.922 (b) (6) (ii).
16  47 C.F.R.  76.922 (b) (6) (ii). Se also Sections of the 
Cable Television Consumer Protection  and Competition Act of 
1992: Rate Regulation, MM Docket No. 92-266, Second Order on 
Reconsideration, Fourth  Report and Order, and  Fifth Notice 
of  Proposed Rulemaking,  9 FCC  Rcd 4119,  4183-4185 (1994) 
(the maximum  permitted rates determined under  Form 393 may 
apply from  May 15,  1994 until the  date that  the operator 
implemented its new rates, as determined under the Form 1200 
series.)
17  Id.
18  Id.
19  Id.
20 See,  for example,  In the Matter  TCI of  Illinois d/b/a 
Telenois, Inc., DA 01-1468, 16 FCC Rcd 12654 (CSB 2001).

21 In the Prior Order,  the Cable Services Bureau calculated 
MPRs for  both the rebuild  and non-rebuild portions  of the 
franchise  area.   Because   Operator's  entire  system  was 
upgraded by  July 15, 1994,  we calculate a single  rate for 
the entire system.

22 Because  Operator elected to defer  refund liability, its 
liability for overcharges based on  the FCC Form 1200 begins 
on July 15, 1994.