**Before the**

**Federal Communications Commission**

**Washington, D.C. 20554**

In the Matter of )

) CUID No. PA1700 (Spring City)

Suburban Cable TV Company, Inc. )

)

Complaint Regarding )

Cable Programming Services Tier Rates )

**ORDER**

**Adopted: May 9, 2000 Released: May 10, 2000**

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

1\. In this Order we consider a complaint[^1] against the rates charged
by the above-referenced operator (\"Operator\") for its cable
programming services tier (\"CPST\") in the community referenced above.
We have already issued an Order in which we found Operator's CPST rate
in effect through May 14, 1994 to be reasonable (\"Prior Order\").[^2]
In our Prior order, we stated that our findings \"do not in any way
prejudge the reasonableness of the prices for CPS service after May 14,
1994 under our new rate regulations.\" [^3] This Order addresses only
the reasonableness of Operator's CPST rates in effect beginning May 15,
1994.

2\. Under the Communications Act,[^4] 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. The Cable Television Consumer Protection
and Competition Act of 1992[^5] (\"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.[^6] The Operator has
the burden of demonstrating that the CPST rates complained about are
reasonable.[^7] If the Commission finds a rate to be unreasonable, it
shall determine the correct rate and any refund liability.[^8]

3\. Operators must use the FCC Form 1200 series to justify rates for the
period beginning May 15, 1994.[^9] 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.[^10] 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.[^11] Any incurred cost that is not projected may be accrued with
interest and added to rates at a later time.[^12]

4\. Upon review of Operator\'s FCC Form 1200, we find Operator's
calculated maximum permitted rate (\"MPR\") of \$9.53 to be reasonable.
Because Operator's actual CPST rate of \$11.42, effective May 15, 1994
through February 14, 1995, exceeds its MPR we find Operator's actual
CPST rate of \$11.42, effective May 15, 1994 through February 14, 1995,
to be unreasonable.[^13] Upon review of Operator's FCC Form 1210
covering the period April 1, 1994 through December 31, 1994, we find
Operator's calculated MPR of \$10.68 to be reasonable, effective
February 15, 1995.[^14] Because Operator's actual CPST rate of \$12.84,
effective February 15, 1995 through June 30, 1995, exceeds its MPR we
find Operator's actual CPST rate of \$12.84, effective February 15, 1995
through June 30, 1995, to be unreasonable. Upon review of Operator's FCC
Form 1210 covering the period January 1, 1995 through June 30, 1995, we
find Operator's calculated MPR of \$11.77 to be reasonable. Because
Operator's actual CPST rate of \$12.84, effective July 1, 1995 through
March 31, 1996, exceeds its MPR we find Operator's actual CPST rate of
\$12.84, effective July 1, 1995 through March 31, 1996, to be
unreasonable.[^15]

5\. Upon review of Operator's FCC Form 1240 for the projected period
April 1, 1996 through March 31, 1997, we find Operator's calculated MPR
of \$12.66 to be reasonable. Because Operator's actual CPST rate of
\$13.80 exceeds its MPR we find Operator's actual CPST rate of \$13.80,
effective April 1, 1996 through March 31, 1997, to be unreasonable. Upon
review of Operator's FCC Form 1240 for the projected period April 1,
1997 through March 31, 1998, we adjusted Worksheet 8 (True-Up Rate
Charged), Lines 801 through 803, to reflect the actual rate charged
during the true-up period. We also adjusted Operator's Worksheet 4
(Residual - Projected Period) at Line 406 because Operator used an
incorrect figure to represent its CAPS Method Channels per Tier. We also
adjusted Operator's Line C5 (Current FCC Inflation Factor) to
1.0177.[^16] Our adjustments reduced Operator's MPR from \$12.95 to
\$12.84.[^17] Because Operator's actual CPST rate of \$14.75 exceeds its
revised MPR we find Operator's actual CPST rate of \$14.75, effective
April 1, 1997 through March 31, 1998 to be unreasonable. Upon review of
Operator's FCC Form 1240 for the projected period April 1, 1998 through
March 31, 1999, we made adjustments to coincide with the prior revised
FCC Form 1240. We also adjusted Operator's Line C5 to 1.0082. Our
adjustments reduced Operator's MPR from \$12.63 to \$11.53. Because
Operator's actual CPST rate of \$15.95 exceeds its revised MPR we find
Operator's actual CPST rate of \$15.95, effective April 1, 1998 through
March 31, 1999, to be unreasonable.[^18]

6\. Accordingly, IT IS ORDERED, pursuant to Section 0.32l of the
Commission\'s rules, 47 C.F.R. § 0.321 that the CPST rates charged by
Operator in the community referenced above, effective May 15, 1994
through March 31, 1999, ARE UNREASONABLE.

7\. 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 franchise area referenced above that portion of the
amount paid in excess of the maximum permitted CPST rate of \$9.53 per
month (plus franchise fees),

plus interest to the date of the refund, for the period May 15, 1994
through February 14, 1995.

8\. 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 franchise area referenced above that portion of the
amount paid in excess of the maximum permitted CPST rate of \$10.68 per
month (plus franchise fees), plus interest to the date of the refund,
for the period February 15, 1995 through June 30, 1995.

9\. 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 franchise area referenced above that portion of the
amount paid in excess of the maximum permitted CPST rate of \$12.84 per
month (plus franchise fees), plus interest to the date of the refund,
for the period October 1, 1997 through March 31, 1998.

10\. 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 franchise area referenced above that portion of the
amount paid in excess of the maximum permitted CPST rate of \$11.53 per
month (plus franchise fees), plus interest to the date of the refund,
for the period April 1, 1998 through March 31, 1999.

11\. IT IS FURTHER ORDERED that Operator shall promptly determine the
overcharges to CPST subscribers for the stated period, and shall within
30 day of the release of this Order, file a report with the Chief, Cable
Services 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 with 60 days of
the approval of the plan.

12\. IT IS FURTHER ORDERED, pursuant to Section 0.32l of the
Commission\'s rules, 47 C.F.R. Section 0.321, that the complaint
referenced herein against the rates charged by Operator in the community
referenced above IS GRANTED.

FEDERAL COMMUNICATIONS COMMISSION

Kathleen F. Costello, Acting Chief

Financial Analysis and Compliance Division

Cable Services Bureau

[^1]: The first valid complaint against Operator\'s CPST rate in the
    community referenced above was filed with the Federal Communications
    Commission on October 26, 1993.

[^2]: *See* In the Matter of Suburban Cable TV Co. Inc., 10 FCC Rcd 5593
    (1995).

[^3]: *Id.* at n. 1.

[^4]: Communications Act, Section 623(c), *as amended*, 47 U.S.C.
    §543(c) (1996).

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

[^6]: *See* Section 76.956 of the Commission\'s Rules, 47 C.F.R.
    §76.956.

[^7]: *Id.*

[^8]: *See* Section 76.957 of the Commission\'s Rules, 47 C.F.R. §
    76.957.

[^9]: *See* Section 76. 922 of the Commission\'s Rules 47 C.F.R. §
    76.922.

[^10]: *Id.*

[^11]: *Id.*

[^12]: *Id*.

[^13]: Operator did not elect to take advantage of the Commission's
    rules which 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 its FCC Form 1200. *See* 47
    C.F.R. 76.922(b)(6)(ii). If Operator did timely file such a request
    and can provide documentation in support thereof, we will take
    Operator's documentation under consideration in our review of
    Operator's refund plan.

[^14]: Operator included in this filing \$0.58 for channels added on
    February 15, 1995.

[^15]: This finding is 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.

[^16]: We used the most recent Inflation Adjustment Factor released by
    the Cable Services Bureau for the relevant time period. *See* Public
    Notice, DA 00-767 (released April 6, 2000).

[^17]: Information regarding the specific adjustments made to
    Operator\'s FCC Forms can be found in the public file for the
    community referenced above which is available in the Cable Services
    Bureau\'s public reference room, or through the Commission\'s copy
    contractor, International Transcription Services, Inc. (ITS), 1231
    20th Street, NW, Washington, DC 20036, or by calling (202) 857-3800.

[^18]: Because Operator\'s refund liability for the period from July 1,
    1995 through September 30, 1997 was trued-up in its FCC Form 1240s,
    which we review herein, Operator is not required to separately
    calculate that refund liability and submit a refund plan.