**Before the**

**Federal Communications Commission**

**Washington, D.C. 20554**

In the Matter of )

) CUID No. GA0378 (Richmond Hill)

Bresnan Communications ) CSR No. 4746-R

)

Complaint Regarding Cable Programming )

Services Tier Rate and Cost of Service )

Showing to Support Basic Service Tier Rate )

**ORDER**

**Adopted: July 20, 2000 Released: July 24, 2000**

By the Acting Chief, Financial Analysis and Compliance Division, Cable
Services Bureau:

1\. In this Order we consider a complaint against the October 1, 1995
rate increase of the above-referenced operator (\"Operator\") for its
cable programming services tier (\"CPST\") in the community referenced
above. In this Order we also review the FCC Form 1235 (Abbreviated Cost
of Service Filing for Cable Network Upgrades) filed to support the rate
Operator was charging for its basic service tier (\"BST\") in the
community referenced above. On February 12, 1996, the City of Richmond
Hill petitioned the Federal Communications Commission (\"Commission\")
requesting assistance in reviewing Operator\'s BST cost of service
showing.[^1] The Commission granted the City\'s request on July 8, 1996,
and agreed to review Operator\'s FCC Form 1235 abbreviated cost of
service showing regarding its BST rate.[^2] This Order addresses the
reasonableness of Operator\'s October 1, 1995 CPST rate increase and the
reasonableness of Operator's calculated FCC Form 1235 maximum permitted
rate (\"MPR\") for the BST.

2\. Under the Communications Act,[^3] 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[^4] (\"1992
Cable Act\") required the Commission to review CPST rates upon the
filing of a valid complaint by a subscriber or local franchising
authority (\"LFA\"). The filing of a complete and timely complaint
triggers an obligation upon the cable operator to file a justification
of its CPST rates.[^5] The Operator has the burden of demonstrating that
the CPST rates complained about are reasonable.[^6] If the Commission
finds a rate to be unreasonable, it shall determine the correct rate and
any refund liability.[^7]

3\. Operators must use the FCC Form 1200 series to justify rates for the
period beginning May 15, 1994.[^8] Cable operators may file an FCC Form
1210 to justify rate increases quarterly based on the addition and
deletion of channels, changes in certain external costs and
inflation.[^9] Operators may justify 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.[^10] Additionally, an Operator may file an FCC Form 1235, which
allows cable operators to justify rate increases related to significant
capital expenditures used to improve rate-regulated services. This
option is extended only in cases of significant upgrades requiring added
capital investment, such as bandwidth capacity and conversion to fiber
optics, and for system rebuilds. Normal improvements and expansions of
service remain subject to the usual rate adjustments allowed by filing
FCC Form 1210s, 1220s and 1240s. Cable operators that incur increases in
operating costs associated with a significant network upgrade will be
permitted to charge additional rates as justified by their FCC Form 1235
filing.

4\. In response to the complaint against Operator\'s October 1, 1995
CPST rate increase, we reviewed Operator's FCC Form 1200 as well as four
FCC Form 1210s covering the period from April 1, 1994 through June 30,
1995. Based upon our review, we find Operator's actual CPST rate of
\$13.17, effective October 1, 1995, to be reasonable. Upon review of
Operator's FCC Form 1235, we find Operator's calculated MPR for the BST
of \$1.63 to be reasonable.[^11]

5\. 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 \$13.17,
charged by Operator in the community referenced above, effective October
1, 1995, IS REASONABLE.

6\. 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 IS DENIED.

7\. IT IS FURTHER ORDERED, pursuant to Section 0.321 of the
Commission\'s rules, 47 C.F.R. § 0.321, that Operator's calculated FCC
Form 1235 maximum permitted rate of \$1.63 for the basic service tier IS
REASONABLE.

8\. IT IS FURTHER ORDERED, pursuant to Sections 76.933(d) and 0.321 of
the Commission\'s rules, 47 C.F.R. §§ 76.933(d) and 0.321, that this FCC
Form 1235 decision is binding on the local franchising authority, the
City of Richmond Hill, Georgia, and the cable operator, Bresnan
Communications.

FEDERAL COMMUNICATIONS COMMISSION

Kathleen F. Costello

Acting Chief, Financial Analysis and Compliance Division

Cable Services Bureau

[^1]: *See* 47 C.F.R. § 76.933 (d).

[^2]: *See* Letter dated July 8, 1996 from Lenworth Smith, Jr., Deputy
    Chief, Financial Analysis and Compliance Division, to the Honorable
    Richard R. Davis, Mayor, City of Richmond Hill, GA.

[^3]: Communications Act, Section 623(c), *as amended*, 47 U.S.C.
    §543(c) (1996).

[^4]: Pub. L. No. 102-385, 106 Stat. 1460 (1992).

[^5]: *See* Section 76.956 of the Commission\'s Rules, 47 C.F.R.
    §76.956.

[^6]: *Id.*

[^7]: *See* Section 76.957 of the Commission\'s Rules, 47 C.F.R. §
    76.957.

[^8]: *See* Section 76. 922 of the Commission\'s Rules, 47 C.F.R. §
    76.922.

[^9]: *Id.*

[^10]: *Id.*

[^11]: These findings are based solely on the representations of
    Operator. Should information come to our attention that these
    representations were materially inaccurate, we reserve the right to
    take appropriate action. This Order is not to be construed as a
    finding that we have accepted as correct any specific entry,
    explanation or argument made by any party to this proceeding not
    specifically addressed herein.