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If you need the complete document, download the WordPerfect version or Adobe Acrobat version, if available. ***************************************************************** Before the Federal Communications Commission Washington, D.C. 20554 In the Matter of ) ) Multimedia Cablevision, Inc. ) CUID No. OK0181 (The Village) ) ) Complaint Regarding ) Cable Programming Services Tier Rate ) ORDER Adopted: January 2, 1998 Released: January 7, 1998 By the Chief, Financial Analysis and Compliance Division, Cable Services Bureau: 1. In this Order we consider a complaint concerning the rates of the above-captioned operator ("Operator") for its cable programming services tier ("CPST") in the community referenced above. Operator's response includes benchmark justifications filed on FCC Forms 1200, 1210, and 1240. We have already issued a prior order which found that Operator's CPST rates in effect prior to May 14, 1994 were not unreasonable. This Order addresses the reasonableness of Operator's rates for the period after May 14, 1994, as justified on Operator's FCC Forms 1200, 1210 and 1240. 2. The Communications Act authorizes the Federal Communications Commission ("Commission") 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") required the Commission to review CPST rates upon the filing of a valid complaint by a subscriber. If the Commission finds rates to be unreasonable, it shall determine correct rates and any refund liability. 3. The Commission's original rate regulations became effective on September 1, 1993. The Commission revised its rate regulations effective May 15, 1994. Operators must use the FCC Form 1200 series to justify their rates for the period beginning May 15, 1994 through a benchmark showing. Cable operators may file a FCC Form 1210 to justify rate increases based on the addition and deletion of channels, changes in certain external costs, and inflation. The Operator must file FCC Form 1210, at least 30 days before new rates are scheduled to go into effect, where the Commission has found the cable programming service rate to be unreasonable less than one year prior to the filing, or where there is a pending complaint against the CPST rate. Operators may justify adjustments to 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. Any incurred cost that is not projected may be accrued with interest and added to rates at a later time. If actual and projected costs are different during the rate year a "true-up" mechanism is available to correct estimated costs with actual cost changes. The "true-up" requires operators to decrease their rates or alternatively permits them to increase their rates to make an adjustment for over or under estimations of these cost changes. 4. Upon review of Operator's FCC Forms 1200 and 1210, we find the Operator has justified its CPST rate of $3.67 effective May 15, 1994 to January 31, 1996. Upon review of Operator's second FCC Form 1210 covering the period January 1, 1995 to December 31, 1995, which was filed to justify Operator's CPST rates effective February 1, 1996 to February 28, 1997, we reduced Operator's inflation factor adjustment factor on Lines I5 and J5 to 2.96. This adjustment reduced Operator's CPST maximum permitted rate ("MPR") from $4.19 to $4.16. Because Operator's actual CPST rate of $4.17, effective February 1, 1996 to February 28, 1997 exceeds its revised MPR of $4.16 by $0.01, we find Operator's actual CPST rate of $4.17, to be unreasonable. However, we further determine that the total overcharge per subscriber is de minimis. Therefore, it would not serve the public interest to order a refund. 5. Upon review of Operator's FCC Form 1240 for the projected period March 1, 1997 to February 28, 1998, we find that Operator has justified its CPST rate of $4.34 effective March 1, 1997. 6. Accordingly, IT IS ORDERED, pursuant to Section 0.321 of the Commission's Rules, 47 C.F.R.  0.321, that the monthly CPST rate charged by Operator in the community referenced above, from May 14, 1994 to January 31, 1996 IS NOT UNREASONABLE. 7. IT IS FURTHER ORDERED, pursuant to Section 0.321 of the Commission's Rules, 47 C.F.R.  0.321, that the monthly CPST rate charged by Operator in the community referenced above, from February 1, 1996 to February 28, 1997 IS UNREASONABLE TO THE EXTENT INDICATED HEREIN. 8. IT IS FURTHER ORDERED, pursuant to Section 0.321 of the Commission's rules, 47 C.F.R.  0.321, that the CPST rate charged by Operator in the community referenced above, for the projected period beginning March 1, 1997 to February 28, 1998 IS NOT UNREASONABLE. 9. IT IS FURTHER ORDERED, pursuant to Section 0.321 of the Commission's rules, 47 C.F.R.  0.321, that the complaint referenced herein against the CPST rate charged by Operator in the community referenced above, IS GRANTED TO THE EXTENT INDICATED. FEDERAL COMMUNICATIONS COMMISSION Elizabeth W. Beaty Chief, Financial Analysis and Compliance Division Cable Services Bureau