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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 ) ) IDS/Jones Growth Partners 87-A Ltd. ) CUID No. CA0163 (Roseville) ) ) Complaints Regarding ) Cable Programming Services Tier Rates) ORDER Adopted: February 25, 1998 Released: March 2, 1998 By the Deputy Chief, Cable Services Bureau: 1. In this Order we consider a complaint against the rates charged by the above-referenced Operator ("Operator") for its cable programming services tier ("CPST") in the community referenced above. Operator has attempted to justify its CPST rates through a benchmark showing on FCC Forms 1200, 1210 and 1240. We have already issued an Order which found Operator's CPST rate, from September 1, 1993 through May 14, 1994 to be not unreasonable. Accordingly, this Order only addresses the reasonableness of Operator's rates in effect after May 14, 1994. 2. Under the Communications Act, the Federal Communications Commission ("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"), and our rules in effect at the time the complaints were filed, required the Commission to review CPST rates upon the filing of a valid complaint by a subscriber. The filing of a valid complaint triggers an obligation on behalf of the cable operator to file a justification of its CPST rates. If the Commission finds the rate to be unreasonable, it shall determine the correct rate and any refund liability. 3. The Commission's original rate regulations took effect on September 1, 1993. The Commission subsequently revised its rate regulations effective May 15, 1994. Cable operators with valid CPST complaints filed against them prior to May 15, 1994 must demonstrate that their CPST rates were in compliance with the Commission's initial rules from the time the complaint was filed through May 14, 1994, and that their rates were in compliance with the revised rules from May 15, 1994 forward. Cable operators attempting to justify their rates for the period prior to May 15, 1994 using a benchmark showing must complete and file FCC Form 393. Operators must use the FCC Form 1200 series to justify their rates for the period beginning May 15, 1994 using a benchmark showing. Cable operators may also justify rate increases based on the addition and deletion of channels, changes in certain external costs, and inflation, by filing FCC Form 1210. FCC Form 1210 must be filed 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. 4. Cable 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 year a "true-up" mechanism is available to correct estimated costs with actual cost changes. 5. Operator filed an FCC Form 1200 to justify its CPST rate, effective May 15, 1994. Upon review of this FCC Form 1200, we find that Operator has justified its maximum permitted rate ("MPR") of $12.76, effective May 15, 1994. Consequently, we find that Operator's CPST rate of $12.76, effective May 15, 1994, is not unreasonable. 6. Upon review of Operator's FCC Form 1210 for the period April 1, 1994 through December 31, 1994, we adjusted Module B, Line B11c, to reflect the total number of subscribers as of March 31, 1994. We also adjusted Module B, Line B13 to account for previous external costs per tier from Operator's prior FCC Form 1200 filing. This resulted in a revised maximum permitted rate ("MPR") of $14.29, effective December 31, 1994. Because Operator's actual CPST rate was $12.76, we find that Operator's actual rate of $12.76, effective January 1, 1995, is not unreasonable. 7. Upon review of Operator's FCC Form 1210 for the period January 1, 1995 through December 31, 1995, we adjusted Line A2 to reflect the MPR of $12.76 carried over from the previous 1210 filing. This adjustment reduced the CPST MPR from $15.30 to $15.16. Because Operator's actual CPST rate was $14.95, we find that Operator's actual rate of $14.95, effective January 1, 1996, is not unreasonable. 8. Upon review of Operator's FCC Form 1240 for the projected period January 1, 1997 through December 31, 1997, we adjusted Line A1 to reflect the MPR of $15.16 carried over from the previous 1210 filing. This adjustment reduced the CPST MPR from $16.42 to $16.19. Operator's actual CPST rate was $16.29. Therefore, Operator's actual CPST rate of $16.29 effective January 1, 1997 through December 31, 1997, is unreasonable. 9. Upon review of Operator's FCC Form 1240 for the projected period January 1, 1998 through December 31, 1998, we adjusted Line A1 to reflect the MPR of $16.19 carried over from the previous FCC Form 1240 filing. We also adjusted Lines C3 (Inflation Factor for True-Up Period 1) and C5 (Current FCC Inflation Factor) to reflect the most recent inflation factor available to the Operator at the time of filing. Lines D8 (Base Rate), F8 (True-Up Segment for True-Up Period 1) and H14 (Remaining True-Up Adjustment) were also adjusted. These adjustments reduced the CPST MPR from $19.12 to $18.44. Because Operator's actual CPST rate was $17.75, we find that Operator's actual rate of $17.75, effective January 1, 1998, is not unreasonable. 10. Accordingly, IT IS ORDERED, pursuant to Section 0.321 of the Commission's rules, 47, C.F.R.  0.321, that the CPST rate of $12.76 charged by Operator from May 15, 1994 to December 31, 1995 in the community referenced above IS NOT UNREASONABLE. 11. IT IS FURTHER ORDERED, pursuant to Section 0.321 of the Commission's rules, 47 C.F.R.  0.321, that the CPST rate of $14.95 charged by Operator from January 1, 1996 to December 31, 1996, in the community referenced above, IS NOT UNREASONABLE . 12. IT IS FURTHER ORDERED, pursuant to Section 0.321 of the Commission's rules, 47 C.F.R.  0.321, that the CPST rate of $16.29 charged by Operator from January 1, 1997 to December 31, 1997 in the community referenced above, IS UNREASONABLE. 13. IT IS FURTHER ORDERED, pursuant to Section 0.321 of the Commission's rules, 47 C.F.R.  0.321, that the CPST rate of $17.75 charged by Operator beginning January 1, 1998 IS NOT UNREASONABLE. 14. IT IS FURTHER ORDERED, pursuant to Section 76.961 of the Commission's rules, 47 C.F.R. Section 76.961, that Operator shall refund to subscribers in Roseville, California, CUID No. CA0163 that portion of the amount paid in excess of the maximum permitted CPST rate of $16.19 per month (plus franchise fees), plus interest to the date of the refund, for the period from January 1, 1997 to December 31, 1997. 15. 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, Cable Services 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. 16. IT IS FURTHER ORDERED, pursuant to Section 0.32l of the Commission's rules, 47 C.F.R. Section 0.321, that the complaints referenced herein against the rates charged by Operator in the community set forth above ARE GRANTED. 17. IT IS FURTHER ORDERED, pursuant to Section 0.321 of the Commission's rules, 47 C.F.R. Section 0.321, that Operator revise the calculation of its maximum permitted CPST rate in its next FCC Form 1240 filing in accordance with our findings in this order. FEDERAL COMMUNICATIONS COMMISSION John E. Logan Deputy Chief, Cable Services Bureau