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


In the Matter of                   ) CUID Nos.    MI0032 (City of Cadillac)
                              )         MI0054 (City of Traverse City)
                              )         MI0171 (Village of Caro)
C-TEC Cable Systems of Michigan, Inc.   )         MI0172 (Indianfields Twp.)
                              )         MI0173 (Almer Twp. )
                              )         MI0174 (Village of Cass City)
                              )         MI0324 (Acme Twp.)
                              )         MI0397 (Elk Rapids Twp)
                              )         MI0455 (City of Belding)
                              )         MI0458 (City of West Branch)
                              )         MI0459 (City of Standish)
                              )         MI0597 (Leighton Twp.)
                              )         MI0604 (Vernon Village)
                              )         MI0608 (Clayton Twp.)
                              )         MI0655 (Caledonia Twp.)
                              )         MI0683 (Zeeland Twp.)
                              )         MI0810 (City of McBain)
                              )         MI0874 (Laketown Twp)
Complaints Regarding                    )         MI0907 (Bellaire)
                              )         MI1170 (Brooks Twp.)
Cable Programming Service Rates         )         MI1538 (Helena Twp.)


                              ORDER

     Adopted:  April 3, 1998                            Released:  April 8, 1998   

By the Acting Chief, Cable Services Bureau:

     1.   In this Order we consider complaints about the rates the above-captioned operator ("Operator")
was charging for its two cable programming service tiers ("CPSTs") in the communities referenced above. 
Operator has chosen to attempt to justify its CPST rates through cost of service showings on FCC Form 1220s,
updated by FCC Form 1210s and/or FCC Form 1240s.  This Order addresses the reasonableness of Operator's
CPST rates effective September 1, 1993 through the present.
  
     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.  If the Commission finds a rate to be unreasonable, it shall determine the correct
rate and any refund liability.  Under Section 76.923(a) of the Commission's Rules, equipment used to receive
the basic service tier ("BST") is subject to rate regulation, regardless of whether such equipment is used to
receive other tiers of regulated programming and/or unregulated service.  Such equipment related charges are
subject to regulation by the local franchising authority ("LFA"). 

     3.   Valid complaints for each community referenced above were filed with the Commission against
the CPST rates Operator was charging in each community from September 1993 through February 1996.  The
filing of a complete and timely complaint triggers an obligation upon the cable operator to file a justification
of its CPST rates.  The operator has the burden of demonstrating that its CPST rates are reasonable.  

     4.    Operators with complete and timely 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 the CPST rates were in compliance with the
revised rules from May 15, 1994 forward.  Operators attempting to justify CPST rates for the period prior to
May 15, 1994 through a benchmark showing must complete and file FCC Form 393.  To justify rates for the
period beginning May 15, 1994 through a benchmark showing, operators must use the FCC Form 1200 series. 
Cable operators attempting to justify their rates for either period through a cost of service showing must
complete and file FCC Form 1220.  

     5.   Operators are permitted to make changes to their rates on a quarterly basis using FCC Form
1210 to account for the addition and deletion of channels, changes in certain external costs and inflation.  In
addition, Operators must file FCC Form 1210 at  least 30 days before new rates are scheduled to go into effect,
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. 

     6.   Operator requested small system relief and attempted to justify its CPST rates using the FCC
Form 1230 (Establishing Maximum Permitted Rates for Regulated Cable Services on Small Cable Systems). 
Several of the LFAs for the communities referenced above complained that operator did not qualify for small
system relief and could not file the FCC Form 1230 for that and other reasons.  Because we have previously
determined that Operator is not entitled to small system relief and have accepted Operator's FCC Form 1240
(Annual Update Form) filings in lieu of its FCC Form 1230 filing, we need not reach the LFAs' other
arguments.  Other issues raised by the LFAs have been resolved by prior orders and we incorporate those
findings in our review.  Operator also filed several Motions to Dismiss raising issues which have been
resolved by our prior orders.  Because we incorporate our prior findings in our review, and because we find
there is at least one valid complaint for each community referenced above, we deny Operator's Motions to
Dismiss.

     7.   Upon review of Operator's FCC Form 1220, FCC Form 1210 and FCC Form 1240 filings,
we find Operator's actual CPST rates, for both its CPSTs, effective September 1, 1993 through the present,
to be reasonable.  

     8.   Accordingly, IT IS ORDERED, pursuant to Section 0.321 of the Commission's rules, 47
C.F.R.  0.321, that the CPST rates, charged by Operator in the communities referenced above, ARE
REASONABLE.

     9.   IT IS FURTHER ORDERED, pursuant to Section 0.321 of the Commission's rules, 47 C.F.R.
 0.321, that the Motions to Dismiss filed by Operator ARE DENIED.

     10.  IT IS FURTHER ORDERED, pursuant to Section 0.321 of the Commission's rules, 47 C.F.R.
 0.321, that the complaints against the CPST rates charged by Operator in the communities referenced above, 
ARE DENIED.

                         FEDERAL COMMUNICATIONS COMMISSION 



                         John E. Logan
                         Acting Chief, Cable Services Bureau