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Federal Communications Commission
Washington, D.C. 20554
In the Matter of ) File No. EB-02-TC-086
Jones Spacelink, Ltd. ) CUID No. IL1050
Petition for Reconsideration )
Adopted: January 24, 2003
Released: January 27, 2003
By the Chief, Enforcement Bureau:
1. In this Order, we deny a petition for reconsideration
("Petition")1 of a Cable Services Bureau Order, DA 95-2170
("Prior Order").2 The Prior Order granted a complaint filed
against the cable programming services tier ("CPST") rates
charged by the above-referenced operator ("Operator")3 from
January 10, 1994 through May 14, 1994.4 The Cable Services
Bureau found Operator's CPST rates to be unreasonable and ordered
refunds. In this Order, we affirm the Prior Order and calculate
Operator's refund liability.
2. Under the provisions of the Communications Act5 that
were in effect at the time the referenced complaints were filed,
the Commission had authority 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 19926 ("1992 Cable Act")
required the Commission to review CPST rates upon the filing of a
valid complaint by a subscriber or local franchising authority.
The filing of a complete and timely complaint triggered an
obligation upon the cable operator to file a justification of its
CPST rates.7 The Operator had the burden of demonstrating that
the CPST rates complained about were reasonable.8 If the
Commission found a rate to be unreasonable, it determined the
correct rate and any refund liability.9
3. In its Petition, Operator does not challenge any of the
substantive findings of the Prior Order. Rather, Operator argues
that it is entitled to an increase in its CPST rates to account
for external cost increases incurred during the period of time
from the effective date of the 1992 Cable Act through the initial
date of regulation. Our rules allow certain cable operators to
make an "adjustment for changes in external costs for the period
between September 30, 1992, and the initial date of regulation or
February 28, 1994, whichever is applicable . . .". 10 Therefore,
to the extent that Operator is entitled to take an adjustment for
increases in external costs that Operator incurred during this
period, it may do so pursuant to the Commission's rules.
Operator attached a chart to its Petition that purported to show
an external cost adjustment of $0.37, for increases between
September 1992 and January 1994. However, in its FCC Form 393,
which was reviewed in the Prior Order, Operator used October 1993
as its initial date of regulation for purposes of calculating its
FCC Form 393 CPST rate. Therefore, Operator is only entitled to
an adjustment for changes in external costs for the period
between September 1992 and October 1993. In order to determine
the correct figure for the initial date of regulation of October
1993, we review Line B7 (Avg. Ext. per Sub. Per Tier on Beginning
Date) of Operator's FCC Form 1200. Our review reveals that
Operator's September 1992 external costs, as indicated on the
attachment to its Petition, were higher than Operator's external
costs as of the initial date of regulation, as reported on Line
B7 of Operator's FCC Form 1200.11 Therefore, there is no
external cost increase for Operator to claim and it is therefore
denied as factually unsubstantiated.12
4. Operator also argues that it should be permitted to
offset its CPST overcharges with its purported basic service tier
("BST") undercharges. The Commission addressed the issue of
inter-tier offsets in Cencom Cable Income Partners ("Cencom"),13
subsequent to the filing of this Petition. In Cencom, the
Commission determined that such inter-tier offsets are
"inconsistent with the Commission's conclusion in the
[Implementation of Sections of the Cable Television Consumer
Protection and Competition Act of 1992, Rate Regulation, MM
Docket 92-266, Report and Order and Further Notice of Proposed
Rulemaking]14 that cable operators should not balance low BST
rates with CPST rates that exceed the maximum permitted rate for
the tier."15 Operator offers no new arguments that would
persuade us to deviate from this policy, which has been
consistently applied in CPST rate cases.16 For the reasons
discussed above, we conclude that Operator's Petition should be
5. Operator filed four refund plans along with its
Petition. Upon review of the refund plan calculated in
accordance with the Prior Order, we find that Operator calculated
too much refund liability.17 Therefore, we reject Operator's
refund plan and calculate Operator's refund liability as follows:
For the period from January 10, 1994 through May 14, 1994, we
calculate an overcharge of $0.70 per month per subscriber.
Operator's actual CPST rate for this period was $10.28 and its
maximum permitted rate was $9.58. Our total calculation,
including franchise fees and interest on the overcharges through
December 31, 2002, equals $52,740.00. 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.
6. Accordingly, IT IS ORDERED, pursuant to Section 1.115
of the Commission's Rules, 47 C.F.R. § 1.115, that the Petition
for Reconsideration of In the Matter of Jones Spacelink, Ltd., DA
95-2170, 10 FCC Rcd 11562 (CSB 1995) IS DENIED.
7. IT IS FURTHER ORDERED, pursuant to Section 76.962 of
the Commission's Rules, 47 C.F.R. § 76.962, that Operator shall
refund to subscribers in the franchise area referenced above the
total amount of $52,740.00, plus any additional interest accruing
between December 31, 2002 and the date of refund, within 60 days
of the release of this Order.
8. IT IS FURTHER ORDERED, pursuant to Section 76.962 of
the Commission's rules, 47 C.F.R. § 76.962, that Operator shall
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 The Petition was originally filed as a consolidated application
for review of three separate orders involving three separate
communities. The issues concerning two of the communities were
previously resolved. See In the Matter of Jones Intercable,
Inc., FCC 98-192, 13 FCC Rcd 15883 (1998). By letter dated
January 21, 2003, Operator requested that the remaining issues,
which concern only the community of Wheaton, IL, CUID No. IL1050,
be adjudicated as a petition for reconsideration.
2 In the Matter of Jones Spacelink, Ltd., DA 95-2170, 10 FCC Rcd
11562 (CSB 1995). 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
3 The term "Operator" includes Operator's successors and
predecessors in interest.
4 The refund liability period runs from January 10, 1994, the
date the first valid complaint was filed with the Commission,
through May 14, 1994. The Cable Services Bureau found Operator's
CPST rates to be reasonable beginning May 15, 1994. See In the
Matter of Jones Growth Partners d/b/a Jones Intercable, Inc., DA
96-1533, 11 FCC Rcd 10656 (CSB 1996).
5 Communications Act, Section 623(c), as amended, 47 U.S.C.
6 Pub. L. No. 102-385, 106 Stat. 1460 (1992).
7 See Section 76.956 of the Commission's Rules, 47 C.F.R. §
9 See Section 76.957 of the Commission's Rules, 47 C.F.R. §
10 See 47 C.F.R. § 76.922(f)(4); Implementation of the Cable
Television Consumer Protection and Competition Act of 1992, Rate
Regulation, Memorandum Opinion and Order, 11 FCC Rcd 20206
(1996); and Time Warner Entertainment Co., LP v. FCC, 144 F.3d 75
(D.C. Cir. 1998).
11 See Appendix B of Implementation of the Cable Television
Consumer Protection and Competition Act of 1992, Rate Regulation,
Memorandum Opinion and Order, 11 FCC Rcd 20206 (1996) for
instructions for calculating the external costs adjustment.
12 Operator was unable to provide any additional supporting
documentation for its proposed increase in response to requests
by Bureau staff.
13 See In the Matter of Cencom Cable Income Partners II, L.P.,
12 FCC Rcd 7948 (1997).
14 8 FCC Rcd 5631 (1993).
15 Cencom at ¶22 (footnote omitted).
16 See, e.g., In the Matter of Suburban Cable TV Co., Inc., 17
FCC Rcd 13700 (EB 2002); In the Matter of Cable One, Inc., 15 FCC
Rcd 20359 (CSB 2000).
17 Operator calculated a total refund liability of $87,292.25.