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Before the
Federal Communications Commission
Washington, D.C. 20554
In the matter of )
)
Telecommunications Management, )
LLC )
d/b/a NewWave Communications )
)
Operator of Cable Systems in: )
) File No. EB-04-HS-008
Ashdown, Arkansas )
Fulton, Kentucky )
Wheatland, Missouri )
Chesterfield, South Carolina )
Pageland, South Carolina )
Bolivar, Tennessee )
Bradford, Tennessee )
Brownsville, Tennessee )
Covington, Tennessee )
Dyer, Tennessee )
Ripley, Tennessee )
)
Request for Waivers of Section )
11.11(a) of the
Commission's Rules
ORDER
Adopted: March 22, 2004 Released: March 23, 2004
By the: Director, Office of Homeland Security, Enforcement
Bureau:
1. In this Order, we grant Telecommunications Management,
LLC d/b/a/ NewWave Communications (``NewWave'') temporary waivers
of section 11.11(a) of the Commission's Rules (``Rules'')1 for
the eleven above-captioned cable television systems. Section
11.11(a) of the Rules 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, 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 entirely, however, concluding that such an exemption
would be inconsistent with the statutory mandate of Section
624(g).6 The amended rules 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.8
3. On January 14, 2004, NewWave filed a request for
temporary waivers of the EAS requirements for the above-captioned
cable systems, asserting that the cost of immediate installation
of EAS equipment in the 11 systems would cause financial
hardship. NewWave states that the 11 systems lacked EAS
equipment when it acquired the systems in September 2003. In
support of its waiver requests, NewWave reports that these are
small cable systems, with the six systems in Ashdown, Bradford,
Chesterfield, Covington, Pageland, and Wheatland serving between
253 and 919 subscribers and the five systems in Bolivar,
Brownsville, Dyer, Fulton, and Ripley serving between 1,043 and
1,938 subscribers. NewWave reports that it plans to: (1)
upgrade the subject cable systems; (2) interconnect the Ripley
and Brownsville systems and the Bradford and Dyer systems; and
(3) perform this upgrade and interconnection in stages throughout
2004, with completion of the final phases by early 2005. Based
on price quotes provided by EAS equipment manufacturers, NewWave
estimates that it will cost approximately $110,000 to purchase
and install EAS equipment at the 11 headends. NewWave asserts
that the estimated cost of $20,000 to install EAS equipment at
the Brownsville and Bradford systems will impose an unnecessary
financial expenditure because the two headends will be eliminated
once the interconnection is completed. NewWave provides
financial data in support of its contention that the cost of
immediate installation of EAS equipment in the 11 cable systems
would cause substantial financial hardship. Finally, NewWave
contends that subscribers will continue to have ready access to
national EAS information from other sources, including its cable
system and over-the-air reception of broadcast television and
radio stations.
4. Based on our review of the financial data and other
information submitted by NewWave, we conclude that temporary
waivers of section 11.11(a) of the Rules for the above-captioned
cable systems is warranted. We also find that the schedule
proposed by NewWave for bringing these 11 newly acquired cable
systems into compliance with section 11.11(a) of the Rules is
reasonable.9 Additionally, we find that the estimated $20,000
cost of installing EAS equipment for the Brownsville and Bradford
systems, which will soon be interconnected with other NewWave
systems, could impose an unnecessary financial expenditure for
NewWave.10
5. NewWave also requests that any waivers that are granted
for the subject cable systems continue to apply if the systems
are sold.11 NewWave contends that the Commission has recognized
the importance of small cable system relief following a system
after its sale to a larger operator.12 In support of this
contention, NewWave cites a 1995 Commission Order which
determined that small cable systems eligible for relief from
cable rate regulation should remain eligible for such relief even
if the system is subsequently acquired by a larger cable
operator.13
6. We deny this request; the temporary waivers of section
11.11(a) of the Rules granted in this Order will not continue to
apply if the captioned cable systems are sold. We have
previously stated that waivers of section 11.11(a) of the Rules
do not continue to apply when cable systems are sold and have
specifically rejected arguments similar to those made by
NewWave.14 Our decision to grant these temporary waivers is
based on our review of the financial data and other information
submitted by NewWave. That information demonstrates that the
estimated cost of EAS equipment for the captioned cable systems
could impose a substantial financial hardship on NewWave and
could impose an unnecessary financial expenditure for two of
NewWave's systems. We have no basis for determining whether
compliance with the EAS requirements would impose a similar
financial hardship on any buyer or buyers if any of NewWave's
cable systems are sold. As stated in Galaxy Cable, the policy of
allowing small cable systems to remain eligible for relief from
rate regulation when they are subsequently acquired by a larger
operator should not be automatically extended to the EAS
context.15 There is a significant distinction between the
ongoing regulatory burdens and costs associated with rate
regulation and the one?time expense of installing EAS
equipment.16 In view of the serious public safety objectives
underlying the EAS rules, it would not be appropriate to
automatically extend the temporary waivers granted for NewWave's
systems to any subsequent buyer regardless of its size or
financial status. However, we will afford any such buyer 30 days
from the date of consummation of the sale of a cable system to
request a waiver of section 11.11(a) of the Rules and to submit
the information necessary to support a financial hardship
showing.17 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.18
7. Accordingly, IT IS ORDERED that, pursuant to sections
0.111, 0.204(b) and 0.311 of the rules,19 Telecommunications
Management, LLC d/b/a NewWave Communications' request for
temporary waivers of section 11.11(a) of the Rules is GRANTED for
the following systems, Fulton, Kentucky until June 1, 2004;
Bolivar, Brownsville, and Ripley, Tennessee until January 1,
2005; Dyer and Bradford, Tennessee until March 1, 2005; Ashdown,
Arkansas; Wheatland, Missouri; Chesterfield and Pageland, South
Carolina; and Covington, Tennessee until October 1, 2005.20
8. IT IS FURTHER ORDERED that Telecommunications
Management, LLC d/b/a NewWave Communications' request that the
temporary waivers of section 11.11(a) continue to apply if the
systems are sold is DENIED.
9. IT IS FURTHER ORDERED that Telecommunications
Management, LLC d/b/a NewWave Communications place a copy of this
waiver in its system files.
10. IT IS FURTHER ORDERED that a copy of this Order shall
be sent by Certified Mail Return Receipt Requested to counsel for
Telecommunications Management, LLC d/b/a NewWave Communications,
Christopher C. Cinnamon, Cinnamon Mueller, 307 North Michigan
Avenue, Suite 1020, Chicago, Illinois 60601.
FEDERAL COMMUNICATIONS
COMMISSION
James A. Dailey
Director, Office of Homeland
Security
Enforcement Bureau
_________________________
1 47 C.F.R. § 11.11(a).
2 Id.
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, 10 FCC Rcd 1786 (1994),
reconsideration granted in part, denied in part, 10 FCC Rcd 11494
(1995).
5 Amendment of Part 73, Subpart G, of the Commission's Rules
Regarding the Emergency Broadcast System, Second Report and
Order, 12 FCC Rcd 15503 (1997).
6 Id. at 15512-13.
7 Id. at 15516-15518.
8 Id. at 15513.
9 NewWave seeks waiver of section 11(a) of the Rules for: (1)
Fulton, Kentucky until June 1, 2004; (2) Bolivar, Brownsville,
and Ripley, Tennessee until January 1, 2005; (3) Dyer and
Bradford, Tennessee until March 1, 2005; and (4) Ashdown,
Arkansas; Wheatland, Missouri; Chesterfield and Pageland, South
Carolina; and Covington, Tennessee until October 1, 2005.
10 See also, Cable One Inc, 19 FCC Rcd 2381 (Director, Office of
Homeland Security, Enforcement Bureau 2004); Cable One, Inc., 18
FCC Rcd 7646 (Chief, Technical and Public Safety Division,
Enforcement Bureau 2003) (granting similar temporary waiver
requests).
11 To partially finance EAS equipment, upgrades, and
interconnections, NewWave plans to sell the cable systems in
Ashdown, Chesterfield, Pageland, Covington, and Wheatland by
October 2005.
12 NewWave's January 14, 2004, Request for Temporary Waivers at
7.
13 See Implementation of Sections of the Cable Television
Consumer Protection and Competition Act of 1992: Rate Regulation,
Sixth Report and Order and Eleventh Order on Reconsideration, 10
FCC Rcd 7393, 7413 (1995).
14 See Galaxy Cable, Inc., 18 FCC Rcd 14522, 14524 (Chief,
Spectrum Enforcement Division, Enforcement Bureau 2003) (``Galaxy
Cable'').
15 Id.
16 Id.
17 See Galaxy Cable, 18 FCC Rcd at 14524.
18 We note that NewWave acquired these 11 cable systems in
September 2003 and should have filed its waiver request before
January 14, 2004. Nevertheless, for the reasons stated supra at
¶4, we find that the compliance schedule proposed by NewWave for
the 11 captioned cable systems is reasonable.
19 47 C.F.R. §§ 0.111, 0.204(b) and 0.311.
20 We clarify that these waivers also encompass the EAS testing
and monitoring requirements.