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 ) File No. EB-02-
TC-028
) CUID No. TN0062
(Chattanooga)
Chattanooga Cable TV Company )
)
Petition for Reconsideration )
ORDER ON RECONSIDERATION
Adopted: September 30, 2002
Released: October 1, 2002
By the Chief, Enforcement Bureau:1
1. In this Order we consider a petition for
reconsideration ("Petition") and request for stay of Cable
Services Bureau Order, DA 96-5452 ("Prior Order"), filed
with the Federal Communications Commission ("Commission") by
the above-referenced operator ("Operator").3 The Prior
Order resolved complaints filed against the rates charged by
Operator for its cable programming services tier ("CPST") in
the community referenced above through May 14, 1994. In the
Prior Order, the Cable Services Bureau stated that its
findings "do not in any way prejudge the reasonableness of
the price for CPS service after May 14, 1994 under our new
rate regulations."4 In this Order we modify, on our own
motion, the Prior Order, dismiss Operator's Petition and
request for stay and address the reasonableness of
Operator's CPST rates beginning May 15, 1994.
2. Under the provisions of the Communications Act5
that were in effect at the time the complaints were filed,
the 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")6 and the Commission's rules required the
Commission to review CPST rates upon the filing of a valid
complaint by a subscriber or local franchising authority
("LFA"). The Telecommunications Act of 1996 ("1996 Act"),7
and the Commission's rules implementing the legislation
("Interim Rules"),8 required that a complaint against the
CPST rate be filed with the Commission by an LFA that has
received more than one subscriber complaint. The filing of
a valid complaint triggers an obligation upon the cable
operator to file a justification of its CPST rates.9 If the
Commission finds the rate to be unreasonable, it shall
determine the correct rate and any refund liability.10
3. During the first phase of rate regulation, from
September 1, 1993 until May 15, 1994, the benchmark rate
analysis and comparison with an operator's actual rates were
calculated using the FCC Form 393.11 The benchmark formula
was revised, effective May 15, 1994.12 Systems first
becoming subject to rate regulation after May 15, 1994 were
required to justify their initial regulated rates using
forms in the FCC Form 1200 series.13 Systems against which
rate complaints were still pending when the Commission
revised its benchmark formula were required to recalculate
their benchmark rates as of May 15, 1994 using the FCC Form
1200.14 The Commission's rules provide for a refund
liability deferral period, if timely requested by Operator,
beginning May 15, 1994 and ending July 14, 1994, for any
overcharges resulting from Operator's calculation of a new
maximum permitted rate on the FCC Form 1200.15 However,
Operator will incur refund liability from May 15, 1994
through July 14, 1994 (or the date Operator restructures its
rates, if sooner) for any CPST rates charged above the FCC
Form 393 MPR approved by the Commission.16
4. Operators may file an FCC Form 1210 to justify
quarterly rate increases based on the addition and deletion
of channels, changes in certain external costs and
inflation.17 Operators may justify their rates on an annual
basis using an 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.18 Any incurred
cost that is not projected may be accrued with interest and
added to rates at a later time.19
5. Our review of the Prior order and the record
herein indicates that the total overcharges for the FCC Form
393 period covered by the Prior Order are de minimis and it
would not be in the public interest to order the payment of
refunds. We therefore modify the Prior Order to exclude any
refund liability. It would not be a judicious use of
Commission resources to attempt to resolve appeals of CPST
rate orders that had no adverse affect on the petitioner,
either because the order found no refund liability at all or
found a de minimis liability that did not later result in
the petitioner incurring actual refund liability.
Resolution of such appeals will have no consequences other
than to put additional strain on limited Commission
resources which are better used to resolve pending
complaints and appeals of orders that involve potential or
actual refund liability. Therefore, the Cable Services
Bureau determined that appeals of CPST rate orders that do
not involve actual refund liability will be dismissed
because there is no real relief that may be granted through
resolution of the appeal.20 Because our resolution of
Operator's Petition would have no effect on Operator's
refund liability, we decline to address the issues raised by
Operator and we dismiss Operator's Petition and request for
stay.
6. Upon review of Operator's FCC Form 1200, we accept
Operator's calculated maximum permitted rate ("MPR") of
$13.96.21 Because Operator's actual CPST rate of $14.30,
effective July 15, 199422 through December 31, 1994, exceeds
it calculated MPR, we find Operator's actual CPST rate of
$14.30, effective July 15, 1994 through December 31, 1994,
to be unreasonable. Upon review of Operator's FCC Form
1210, covering the period April 1, 1994 through December 31,
1994, we find Operator's actual CPST rate of $14.30,
effective January 1, 1995, to be reasonable. We also find
Operator's actual CPST rate of $16.06, effective February 1,
1995, to be reasonable.
7. Accordingly, IT IS ORDERED, pursuant to Section
1.106 of the Commission's rules, 47 C.F.R. § 1.106, that the
petition for reconsideration and request for stay filed by
Operator ARE DISMISSED.
8. IT IS FURTHER ORDERED, pursuant to Section 1.106
of the Commission's rules, 47 C.F.R. § 1.106, that In the
Matter of Triax Midwest Associates, DA 96-545, 11 FCC Rcd
4778 (CSB 1996) IS MODIFIED TO THE EXTENT INDICATED HEREIN.
9. IT IS FURTHER ORDERED, pursuant to Sections 0.111
and 0.311 of the Commission's rules, 47 C.F.R. §§ 0.111 and
0.311, that the CPST rate of $14.30, charged by Operator in
the community referenced above, effective July 15, 1994
December 31, 1994, IS UNREASONABLE.
10. IT IS FURTHER ORDERED, pursuant to Sections 0.111
and 0.311 of the Commission's rules, 47 C.F.R. §§ 0.111 and
0.311, that the CPST rates charged by Operator in the
community referenced above, effective January 1, 1995, ARE
REASONABLE.
11. IT IS FURTHER ORDERED, pursuant to Section 76.961
of the Commission's rules, 47 C.F.R. § 76.961, that Operator
shall refund to subscribers in the community referenced
above that portion of the amount paid in excess of the
maximum permitted CPST rate of $13.96 per month (plus
franchise fees), plus interest to the date of the refund,
for the period July 15, 1994, through December 31, 1994.
12. 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, Enforcement 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.
13. IT IS FURTHER ORDERED, pursuant to Sections 0.111
and 0.311 of the Commission's rules, 47 C.F.R. §§ 0.111 and
0.311, that the complaints referenced herein against the
CPST rates charged by Operator in the community referenced
above ARE GRANTED TO THE EXTENT INDICATED HEREIN.
FEDERAL COMMUNICATIONS
COMMISSION
David H. Solomon
Chief, Enforcement Bureau
_________________________
1 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 4672 (2002).
2 In the Matter of Chattanooga Cable TV Company, DA 96-545,
11 FCC Rcd 4778 (CSB 1996).
3 The term "Operator" includes Operator's successors and
predecessors in interest.
4 Prior Order at n. 1.
5 47 U.S.C. §543(c) (1996).
6 Pub. L. No. 102-385, 106 Stat. 1460 (1992).
7 Pub. L. No. 104-104, 110 Stat. 56 (1996).
8 See Implementation of Cable Act Reform Provisions of the
Telecommunications Act of 1996, 11 FCC Rcd 5937 1996).
9 See Section 76.956 of the Commission's rules, 47 C.F.R.
§76.956.
10 See Section 76.957 of the Commission's rules, 47 C.F.R.
§76.957.
11 See Implementation of Sections of the Cable Television
Consumer Protection and Competition Act of 1992: Rate
Regulation, 8 FCC Rcd 5631, 5755-56, 5766-67, 5881-83
(1993).
12 See Implementation of Sections of the Cable Television
Consumer Protection and Competition Act of 1992: Rate
Regulation, 9 FCC Rcd 4119 (1994).
13 See Section 76.922 of the Commission's rules, 47 C.F.R. §
76.922.
14 Id.
15 See 47 C.F.R. § 76.922 (b) (6) (ii).
16 47 C.F.R. § 76.922 (b) (6) (ii). Se also Sections of the
Cable Television Consumer Protection and Competition Act of
1992: Rate Regulation, MM Docket No. 92-266, Second Order on
Reconsideration, Fourth Report and Order, and Fifth Notice
of Proposed Rulemaking, 9 FCC Rcd 4119, 4183-4185 (1994)
(the maximum permitted rates determined under Form 393 may
apply from May 15, 1994 until the date that the operator
implemented its new rates, as determined under the Form 1200
series.)
17 Id.
18 Id.
19 Id.
20 See, for example, In the Matter TCI of Illinois d/b/a
Telenois, Inc., DA 01-1468, 16 FCC Rcd 12654 (CSB 2001).
21 In the Prior Order, the Cable Services Bureau calculated
MPRs for both the rebuild and non-rebuild portions of the
franchise area. Because Operator's entire system was
upgraded by July 15, 1994, we calculate a single rate for
the entire system.
22 Because Operator elected to defer refund liability, its
liability for overcharges based on the FCC Form 1200 begins
on July 15, 1994.