Click here for Adobe Acrobat version
Click here for Microsoft Word version

******************************************************** 
                      NOTICE
********************************************************

This document was converted from Microsoft Word.

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
Microsoft Word or Adobe Acrobat version.

*****************************************************************



                           Before the
                Federal Communications Commission
                     Washington, D.C. 20554
                                
In the Matter of                )
                                )
SM Cable Holdings, L.L.C.      )     File No. EB-02-TS-301
                                )
Operator of Cable Systems in:   )
                                )
Andalusia (Heath), Alabama      )
Ashville, Alabama               )
Barnwell, Alabama               )
Blount County, Alabama          )
Good Hope, Alabama              )
Frazier Park, California        )
Lake Almanor, California        )
Port St. Joe, Florida           )
Soda Springs, Idaho             )
Winnemucca, Nevada              )
Shady Cove, Oregon              )
Kemmerer, Wyoming               )
                                )
Request for Waiver of Section 11.11(a) of the     )    
Commission's Rules              )    
                                        
                              ORDER  

Adopted:  February 6, 2004                   Released:   February 
10, 2004

By the Director, Office of Homeland Security, Enforcement Bureau:

1.        In  this  Order,  we  extend  the  temporary,  12-month 
  waivers  of   Section  11.11(a)  of   the  Commission's   Rules 
  (``Rules'')  previously granted  to SM  Cable Holdings,  L.L.C. 
  (``SM  Cable'') for  the  12 above-captioned  cable  television 
  systems  for  an additional  nine  months.1   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, 
  2002.2 

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.3  In 1994, the Commission adopted rules  requiring 
  cable systems to participate in EAS.4  In 1997, the  Commission 
  amended the  EAS rules  to provide financial  relief for  small 
  cable systems.5  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).6    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.7  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.

3.        On  July  11,  2002,  SM  Cable  filed  a  request  for 
  temporary, 36-month waivers of Section 11.11(a) for 180  small, 
  rural  cable systems  in  the states  of  Alabama,  California, 
  Florida,  Georgia,   Idaho,  Montana,  Nevada,  Oregon,   South 
  Carolina, Utah  and Wyoming.  In its  waiver request, SM  Cable 
  stated  that  168  cable systems  served  between  16  and  953 
  subscribers  and 12  cable  systems served  between  1,029  and 
  2,792 subscribers.  In support of its waiver request, SM  Cable 
  estimated that  it would cost  approximately $7,300 to  install 
  EAS  equipment at each  of the  180 cable systems  for a  total 
  cost of  $1,314,000.  SM  Cable asserted that  this cost  would 
  impose a substantial financial hardship on it.  On January  13, 
  2003,  we  granted SM  Cable  temporary,  36-month  waivers  of 
  Section 11.11(a) for 168 cable systems and temporary,  12-month 
  waivers  of  Section  11.11(a)  for  12  cable  systems.8    We 
  concluded  that  the  financial  data  and  other   information 
  submitted by  SM Cable at  that time did  not justify a  waiver 
  period of longer duration for the 12 cable systems.  

4.        On September 16, 2003, SM  Cable filed a request for  a 
  temporary,  24-month  extension  of  the  temporary,   12-month 
  waivers granted in the Waiver Order for the 12 captioned  cable 
  systems.  SM Cable states  that it was in a state of  financial 
  crisis and that both  prior to and going forward from the  date 
  of the initial waiver  request it attempted to sell all of  its 
  cable systems.   SM Cable further states  that it sold some  of 
  its assets  in July 2002  and some in  January 2003.  SM  Cable 
  notes  that  it   is  currently  operating  under  Chapter   11 
  bankruptcy pursuant  to a Court-approved plan.9   Additionally, 
  SM  Cable asserts  that the  Bankruptcy  Court will  conduct  a 
  hearing  on September  24,  2003  to approve  the  final  asset 
  purchase agreement.   In a  January 15, 2004  report, SM  Cable 
  affirms  that the  Bankruptcy Court  approved the  final  asset 
  purchase agreement.  SM Cable anticipates that the sale of  the 
  remaining 12 systems will occur in February 2004.  

5.        Based on  the  information  provided by  SM  Cable,  we 
  conclude that 24-month  extensions of the temporary waivers  of 
  Section 11.11(a) previously  granted to the 12 captioned  cable 
  systems  are   not  warranted.   Instead,   we  conclude   that 
  temporary,  nine-month extensions  of  the waivers  of  Section 
  11.11(a)   for    these   cable   systems   are    warranted.10  
  Furthermore, in  view of the  serious public safety  objectives 
  underlying  the EAS rules,  we do  not think that  it would  be 
  appropriate  to  automatically  extend  the  temporary  waivers 
  granted  to  SM   Cable's  systems  to  any  subsequent   buyer 
  irrespective of its size or financial status.  Rather, we  will 
  afford any  such buyer 30 days  from the date  the sale of  any 
  system  or  systems  is consummated  to  request  a  waiver  of 
  Section  11.11(a),  submitting  the  information  necessary  to 
  support a financial hardship showing.  Any buyer that does  not 
  file a waiver request will be required to come into  compliance 
  with the EAS rules by the end of the 30-day period.

6.        Accordingly, IT IS ORDERED  that, pursuant to  Sections 
  0.111,  0.204(b), 0.311  of  the Rules,11  SM  Cable  Holdings, 
  L.L.C. IS  GRANTED a  waiver extension of  Section 11.11(a)  of 
  the  Rules  until July  1,  2004  for the  12  captioned  cable 
  television systems. 

7.        IT IS FURTHER  ORDERED that SM  Cable Holdings,  L.L.C. 
  place a copy of this waiver extension 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 SM Cable  Holdings, L.L.C., Sharon O'Malley Monahan,  Esq., 
  Fleishman  and  Walsh, L.L.P.,  1400  Sixteenth  Street,  N.W., 
  Washington, D.C.  20036. 

                         FEDERAL COMMUNICATIONS COMMISSION
                         


                         James A. Dailey
                         Director, Office of Homeland Security
                         Enforcement Bureau


_________________________

  1 SM Cable Holdings,  L.L.C., 18 FCC Rcd 1 (Enf. Bur., Tech.  & 
Pub. Safety Div., 2002) (``Waiver Order'').

  2 47 C.F.R.  11.11(a).

  3 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).  

  4 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), reconsideration  granted in  part, 
denied in part, 10 FCC Rcd 11494 (1995) (``Report and Order'').

  5 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).

  6 Id. at 15512-13.

  7 Id. at 15516-15518.

  8 18 FCC Rcd at 1.

  9 On May 9,  2003, SM Cable Holdings, L.L.C. filed for  Chapter 
11 bankruptcy  with  the  United  States  Bankruptcy  Court,  the 
District of Delaware.

  10 These  temporary waivers will extend  from October 1,  2003, 
until July 1, 2004.  We clarify that the waivers we are  granting 
also encompass the EAS testing and monitoring requirements.  

  11 47 C.F.R.  0.111, 0.204(b), 0.311.