**Before the**

**Federal Communications Commission**

**Washington, D.C. 20554**

+----------------------------------+---+------------------------------+
| In the Matter of                 | ) | File No. EB-02-TC-066        |
|                                  |   |                              |
| Time Warner Cable                | ) | MA0048 (Medford County)      |
|                                  |   |                              |
| Petition for Reconsideration and | ) |                              |
| Refund Plan                      |   |                              |
|                                  | ) |                              |
|                                  |   |                              |
|                                  | ) |                              |
+----------------------------------+---+------------------------------+
|                                  |   |                              |
+----------------------------------+---+------------------------------+

ORDER ON RECONSIDERATION

**Adopted: July 16, 2002** **Released: July 17, 2002**

By the Chief, Enforcement Bureau:[^1]

1.  In this Order we consider a petition for reconsideration
    (\"Petition\") of Cable Services Bureau Order, DA 98-1839 (\"Prior
    Order\").[^2] In the Prior Order, the Cable Services Bureau found
    the above-referenced operator\'s (\"Operator\'s\")[^3] January 1,
    1998 cable programming services tier (\"CPST\") rate increase in the
    above-referenced community to be unreasonable. Operator supplemented
    its Petition with amended FCC Form 1240s and also filed a refund
    plan (\"Refund Plan\"). In this Order, we grant Operator\'s
    Petition, reject Operator's Refund Plan, and order refunds
    consistent with this Order.

2.  Under the provisions of the Communications Act[^4] 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\")[^5] 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\"),[^6] and the Commission\'s rules implementing the
    legislation (\"Interim Rules\"),[^7] 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.[^8] If the Commission finds
    the rate to be unreasonable, it shall determine the correct rate and
    any refund liability.[^9]

3.  Operators must use the FCC Form 1200 series to justify rates for the
    period beginning May 15, 1994.[^10] Cable 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.[^11] 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.[^12] Any incurred cost that is not projected may be accrued
    with interest and added to rates at a later time.[^13]

4.  In its Petition, Operator asserts that the Prior Order contained a
    clerical error. In support of its assertion, Operator submitted
    amended forms incorporating all of the adjustments made by the Cable
    Services Bureau in the Prior Order. We reviewed Operator's filing
    and agree that a clerical error was made in the Prior Order. We find
    Operator's revised calculated maximum permitted rate (\"MPR\") of
    \$19.66 to be reasonable, effective February 2, 1998 (the date the
    first valid complaint was filed with the LFA) through December 31,
    1998 and we modify the Prior Order accordingly. Because Operator's
    actual CPST rate of \$20.12, effective January 1, 1998 through
    December 31, 1998, exceeds its revised calculated MPR of \$19.66, we
    find Operator's actual CPST rate of \$20.12, effective February 2,
    1998 through December 31, 1998, to be unreasonable.

5.  Upon review of Operator\'s Refund Plan,[^14] we find that the Refund
    Plan does not fulfill the requirements of this Order. Operator
    calculated its refund liability based on the Prior Order's MPR of
    \$19.41, and calculated interest only for 1998. We calculate
    Operator's refund liability as follows: For the period from February
    2, 1998 through December 31, 1998,[^15] we calculate an overcharge
    of \$0.46 per month per subscriber. Our total calculation, including
    three percent franchise fees plus interest on the overcharges and
    franchise fees through July 31, 2002, equals \$108,761.00. We order
    Operator to refund this amount, plus any additional interest accrued
    to the date of refund, to its CPST subscribers within 60 days of the
    release of this Order.

6.  Accordingly, IT IS ORDERED, pursuant to Section 1.106 of the
    Commission\'s rules, 47 C.F.R. § 1.106, that Operator\'s petition
    for reconsideration IS GRANTED.

7.  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 *In the
    Matter of Time Warner Cable*, DA 98-1839, 13 FCC Rcd 19560
    (CSB 1998) IS MODIFIED TO THE EXTENT INDICATED HEREIN.

8\. IT IS FURTHER ORDERED, pursuant to Sections 0.111, 0.311 and 76.962
of the Commission's rules, 47 C.F.R. §§ 0.111, 0.311 and §76.962, that
Operator shall refund to subscribers in the franchise area referenced
above the total amount of \$108,761.00, plus any additional interest
that accrues between July 31, 2002 and the date of refund, within 60
days of the release of this Order.

9\. IT IS FURTHER ORDERED, pursuant to Sections 0.111, 0.311 and 76.962
of the Commission\'s rules, 47 C.F.R. §§ 0.111, 0.311 and §76.962, that
Operator file a certificate of compliance with the Chief, Enforcement
Bureau, within 90 days of the release of this Order certifying its
compliance with this Order.

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 Time Warner Cable*, DA 98-1839, 13 FCC Rcd 19560
    (CSB 1998).

[^3]: The term \"Operator\" includes Operator's successors and
    predecessors in interest.

[^4]: 47 U.S.C. §543(c) (1996).

[^5]: Pub. L. No. 102-385, 106 Stat. 1460 (1992).

[^6]: Pub. L. No. 104-104, 110 Stat. 56 (1996).

[^7]: *See Implementation of Cable Act Reform Provisions of the
    Telecommunications Act of 1996*, 11 FCC Rcd 5937 1996).

[^8]: *See* Section 76.956 of the Commission\'s rules, 47 C.F.R.
    §76.956.

[^9]: *See* Section 76.957 of the Commission\'s rules, 47 C.F.R.
    §76.957.

[^10]: *See* Section 76.922 of the Commission\'s rules, 47 C.F.R. §
    76.922.

[^11]: *Id.*

[^12]: *Id.*

[^13]: *Id*.

[^14]: Operator calculated a total refund liability of \$131,622.03.

[^15]: Operator's refund liability extends from the date of the first
    valid complaint, February 2, 1998, through December 31, 1998.