10512 Federal Register / Vol. 60, No. 38 / Monday, February 27, 1995 / Rules and Regulations

47 CFR Part 73

[MM Docket No. 90–139; RM–7149 and 7484]

Radio Broadcasting Services;

Oshkosh, Winneconne and Townsend,

Wisconsin and Menominee, Michigan

AGENCY: Federal Communications

Commission.

ACTION: Final rule.

SUMMARY: This document substitutes

Channel 280C3 for Channel 280A at

Oshkosh, Wisconsin, modifies the

license for Station WMGV(FM) and

changes the community of license from

Oshkosh to Winneconne, Wisconsin,

substitutes Channel 279C3 for Channel

280A at Menominee, Michigan, and

modifies the license for Station WHYB

to specify operation on the higher class

channel, in response to a petition filed

by Value Radio Corp and CJL

Broadcasting, Inc. See 55 FR 11412,

March 28, 1990. The coordinates for

Channel 280C3, Winneconne, are 44–

15–09 and 88–44–48. Canadian

concurrence has been obtained for

Channel 279C3 at Menominee at

coordinates 45–06–21 and 87–46–43.

The counterproposal filed by

Independence Broadcasting Wisconsin

Corp. requesting allotment of Channel

278C3 to Townsend, Wisconsin, has

been withdrawn. With this action, this

proceeding is terminated.

EFFECTIVE DATE: April 7, 1995.

FOR FURTHER INFORMATION CONTACT:

Kathleen Scheuerle, Mass Media

Bureau, (202) 418–2180.

SUPPLEMENTARY INFORMATION: This is a

summary of the Commission’s Report

and Order, MM Docket No. 90–139,

adopted February 10, 1995, and released

February 21, 1995. The full text of this

Commission decision is available for

inspection and copying during normal

business hours in the FCC Dockets

Branch (Room 230), 1919 M Street, NW,

Washington, D.C. The complete text of

this decision may also be purchased

from the Commission’s copy

contractors, International Transcription

Services, Inc., 2100 M Street, NW, Suite

140, Washington, D.C. 20037, (202) 857–

3800.

List of Subjects in 47 CFR Part 73

Radio broadcasting.

Part 73 of Title 47 of the Code of

Federal Regulations is amended as

follows:

PART 73—[AMENDED]

1. The authority citation for Part 73

continues to read as follows:

Authority: 47 U.S.C. 154, 303.

§ 73.202 [Amended]

2. Section 73.202(b), the Table of FM

Allotments under Wisconsin, is

amended by removing Channel 280A,

Oshkosh, and by adding Winneconne,

Channel 280C3.

3. Section 73.202(b), the Table of FM

Allotments under Michigan, is amended

by removing Channel 280A and adding

Channel 279C3, Menominee.

Federal Communications Commission.

John A. Karousos,

Chief, Allocations Branch, Policy and Rules

Division, Mass Media Bureau.

[FR Doc. 95–4694 Filed 2–24–95; 8:45 am]

BILLING CODE 6712–01–F

47 CFR Part 76

[MM Docket 92–266; FCC 95–43]

Cable Television Act of 1992—Rate

Regulation

AGENCY: Federal Communications

Commission.

ACTION: Final rule.

SUMMARY: On its own motion, the

Federal Communication Commission

(the ‘‘Commission’’) has adopted a

Ninth Order on Reconsideration in

order to allow small cable operators and

low-price systems that have been

provided with transition relief to adjust

their transition rates to reflect increases

in inflation. Between April 1, 1995 and

August 31, 1995, cable operators that

have been afforded transition relief may

adjust their rates to reflect the net of a

5.21% inflation adjustment, minus any

inflation adjustments they have already

received. In the future, all transition

relief systems may join other operators

by making inflation adjustments on an

annual basis, no earlier than October 1,

of each year and no later than August 31

of the following year to reflect the final

GNP–PI through June 30 of the

applicable year.

EFFECTIVE DATE: April 1, 1995.

FOR FURTHER INFORMATION CONTACT: Paul

D’Ari, Cable Services Bureau (202) 416–

0800.

SUPPLEMENTARY INFORMATION: This is a

synopsis of the Ninth Order on

Reconsideration in MM Docket No. 92–

266, FCC 95–43, adopted February 3,

1995 and released February 6, 1995.

The complete text of this Ninth Order

on Reconsideration is available for

inspection and copying during normal

business hours in the FCC Reference

Center (room 239), 1919 M Street NW.,

Washington, DC, and also may be

purchased from the Commission’s copy

contractor, International Transcription

Services, Inc. (‘‘ITS, Inc.’’) at (202) 857–

3800, 2100 M Street NW., Suite 140,

Washington, DC 20037.

Synopsis of the Ninth Order on

Reconsideration

A. Background

In the Report and Order and Further

Notice of Proposed Rulemaking in MM

Docket No. 92–266 (‘‘Rate Order’’), 58

FR 29736 (May 21, 1993), the

Commission developed a benchmark

formula for the purpose of establishing

initial rates for regulated services.

Under the benchmark approach,

regulated cable systems were required to

calculate an applicable benchmark, an

estimate of the rate that a cable system

with similar characteristics, but subject

to effective competition, would be

permitted to charge. Cable systems

whose rates exceeded the applicable

benchmark were generally required to

reduce their rates either to the

benchmark or by 10%, whichever

reduction was less. This 10%

‘‘competitive differential’’ represented

the average difference that the

Commission determined existed

between the rates of competitive and

noncompetitive systems.

In the Second Order on

Reconsideration, Fourth Report and

Order, and Fifth Notice of Proposed

Rulemaking (‘‘Second Reconsideration

Order’’), 59 FR 17943 (April 15, 1994),

the Commission refined the econometric

model, recalculated the competitive

differential, and concluded that a

competitive differential of 17% more

accurately estimates the difference

between effectively competitive and

noncompetitive cable rates.

Accordingly, the Commission required

most systems with rates above the

benchmark to either reduce their

regulated rates to a level that

represented their September 30, 1992

regulated revenues, reduced by 17%

(mitigated by annual inflation increases,

changes in external costs and changes in

the number of programming channels)

or to submit a cost-of-service showing

supporting higher rates.

The Commission granted two classes

of cable operators transition relief, by

not requiring them to implement the full

17% reduction rate. The first category of

systems that were provided with

transition relief is systems owned by

‘‘small operators,’’ defined as operators

serving 15,000 or fewer subscribers and

not affiliated with a larger operator.

Systems owned by small operators were

not required to reduce rates by 17%.

Rather these operators were allowed to

use the permitted rate charged on March

31, 1994 to establish initial restructured

rates, and adjust accordingly to reflect
Federal Register / Vol. 60, No. 38 / Monday, February 27, 1995 / Rules and Regulations 10513

external costs until the Commission

completed its study of prices and costs

experienced by small operators.

The second category of systems that

were provided with transition relief is

systems that charge relatively low prices

for regulated services. Low-price

systems are defined as systems (1)

whose March 31, 1994 rates were below

the benchmark rate, or (2) whose March

31, 1994 rates were above their March

31, 1994 benchmark rates, but whose

March 31, 1994 full reduction rates are

below their March 31, 1994 benchmark

rates as determined under FCC Form

1200. During the transition period,

systems whose March 31, 1994 rates

were below the benchmark rate had

their rates capped at March 31, 1994

levels. Systems whose March 31, 1994

rates were above the benchmark, but

whose full reduction rates were below

the benchmark were only required to

reduce their rates to, but not below, the

benchmark.

The Commission stated that it would

not require small cable operators and

low-price systems that were provided

with transition relief to make full

competitive rate reductions until the

Commission collected and analyzed

data about such operators’ prices and

costs, and determined whether the

competitive rate reduction was

appropriate.

Systems entitled to transition relief

have been permitted to increase their

rates to reflect increases in external

costs and a per channel adjustment

when increasing the number of

channels. The Commission decided not

to allow such systems, however, to

increase their transition rates to reflect

increases in inflation until the transition

rate equals their full reduction rate. The

Commission determined that because

the full reduction rate rises with

inflation, as well as with changes in

external costs and channel changes, a

transition rate system’s hypothetical full

reduction rate may eventually exceed

the transition rate. The Commission

decided, therefore, that if a system’s

transition rate and the full reduction

rate became equal, that system would be

entitled to take advantage of inflation

adjustments.

The Commission also stated that after

it has determined whether it should

require transition relief operators to

reduce their rates in accordance with an

appropriate competitive differential,

those systems will be entitled to an

aggregate inflation adjustment equal to

the GNP–PI inflation adjustments for the

period beginning October 1, 1992

through the most recent June 30. For

those systems that have already received

some inflation adjustment, because their

hypothetical full reduction rate

exceeded their transition rate, the

Commission stated that the system will

receive the net of the aggregate inflation

adjustment minus any inflation

adjustment already received. The

Commission found that such systems

will be eligible for additional inflation

adjustments on an annual basis, but no

earlier than September 30 of each year

to reflect the final GNP–PI through June

30 of the applicable year.

B. Discussion

On its own motion, the Commission

found that low-price systems and small

operators that have been provided with

transition relief should no longer be

prevented from adjusting their rates to

reflect changes in inflation. In the

Second Order on Reconsideration, 59

FR 17943 (April 15, 1994), the

Commission decided to defer

implementing the inflation adjustment

for transition relief systems because it

was not yet requiring them to reduce

their rates by the competitive

differential. The Commission decided

that it would provide transition relief

systems with the opportunity to make

inflation adjustments after it developed

a better picture of the price/cost profiles

of these systems and determined the

appropriate competitive differential for

such systems. In making the decision,

the Commission stated that it expected

to complete the collection of cost/price

data within nine months.

Because the Commission has not yet

completed the collection of this data

and nearly ten months have passed

since the Commission released the

Second Order on Reconsideration, the

Commission finds that it would be

unfair to further delay implementation

of inflation adjustments for transition

relief systems. The Commission is

concerned that a further delay in

permitting transition relief systems to

make inflation adjustments could be

particularly burdensome on small

operators because many small operators

may not have the financial resources to

withstand the impact of not being able

to make inflation adjustments.

The Commission also finds that lowprice systems should not be required to

experience any further delays in

implementing inflation adjustments. In

the Second Order on Reconsideration,

the Commission found that because

their prices are significantly lower than

those charged by most noncompetitive

systems, low price systems may face

unusual demand, costs or other

influences that were not captured in the

Commission’s analysis. A further delay

in allowing low-price systems to make

inflation adjustments may, therefore,

impose a substantial burden upon those

operators.

Accordingly, between April 1, 1995

and August 31, 1995, cable operators

that have been afforded transition relief

may adjust their rates to reflect the net

of a 5.21% inflation adjustment, minus

any inflation adjustments they have

already received. This adjustment

accounts for the 3% inflation that

regulated cable operators were

permitted to recover for the September

30, 1992 to September 30, 1993 period,

and the 2.15% inflation factor that

operators were permitted to recover

between October 1, 1994 and August 31,

1995 for the October 1, 1993 to June 30,

1994 period.

With one exception, however,

transition relief systems will not receive

the full 5.21% inflation adjustment

because, under the old rules, they

received an inflation adjustment from

September 30, 1992 to the date they

were subject to regulation for the

purpose of establishing their initial rates

prior to May 15, 1994. The exception is

for most low price systems that had

their March 31, 1994 rates above the

benchmark, but their full reduction rate

below the benchmark. When these

systems set their rates for the period

after May 15, 1994, they lost the

inflation adjustment they received prior

to May 15, 1994, because they were

required to reduce their rates to the

benchmark. Therefore, they will be

permitted to adjust their rates to reflect

the full 5.21% inflation factor. If,

however, their actual post-May 15, 1994

rate reduction was less than their earlier

inflation adjustment, they will be

permitted to receive the 5.21% inflation

adjustment minus the difference

between their inflation adjustment and

their actual post-May 15, 1994 rate

reduction.

The Commission determined in the

Second Order on Reconsideration that,

because the full reduction rate rises

with inflation, a transition rate system’s

hypothetical full reduction rate may

eventually exceed the transition rate.

The Commission decided that a

transition rate system will be entitled to

take an inflation adjustment once the

hypothetical full reduction rate and

transition rate become equal. Therefore,

those transition relief systems that have

already received this inflation

adjustment, because their hypothetical

full reduction rate exceeded their

transition rate, will only be allowed to

receive the net of the aggregate inflation

adjustment minus any inflation

adjustment already received.

With the inflation adjustment they

received prior to May 15, 1994 and the

inflation adjustment the Commission is
10514 Federal Register / Vol. 60, No. 38 / Monday, February 27, 1995 / Rules and Regulations

granting them now, transition relief

systems will be able to adjust their rates

to reflect the same inflation adjustment

that the Commission has granted all

other operators. Moreover, in the future,

all transition relief systems may join

other cable operators in making

inflation adjustments on an annual

basis, no earlier than October 1 of each

year and no later than August 31 of the

following year to reflect the final GNP–

PI through June 30 of the applicable

year.

Administrative Matters

Regulatory Flexibility Act Analysis

Pursuant to the Regulatory Flexibility

Act of 1980, 5 U.S.C. 601–612, the

Commission’s final analysis with

respect to the Ninth Order on

Reconsideration is as follows:

Need and purpose of this action. The

Commission, in compliance with

section 3 of the Cable Television

Consumer Protection and Competition

Act of 1992, 47 U.S.C. 543 (1992),

pertaining to rate regulation, adopts

revised rules and procedures intended

to ensure that cable services are offered

at reasonable rates with minimum

regulatory and administrative burdens

on cable entities.

Summary of issues raised by the

public in response to the Initial

Regulatory Flexibility Analysis. There

were no comments submitted in

response to the Initial Regulatory

Flexibility Analysis. The Chief Counsel

for Advocacy of the United States Small

Business Administration (SBA) filed

comments in the original rulemaking

order. The Commission addressed the

concerns raised by the Office of

Advocacy in the Report and Order and

Further Notice of Proposed Rulemaking.

Significant alternatives considered

and rejected. In the course of this

proceeding, petitioners representing

cable interests and franchising

authorities submitted several

alternatives aimed at minimizing

administrative burdens. The

Commission has attempted to

accommodate the concerns expressed by

these parties. In this order, the

Commission is providing relief to small

systems and low-price systems by

permitting them to adjust their

transition rates with an inflation

adjustment.

Paperwork Reduction Act

The requirements adopted herein

have been analyzed with respect to the

Paperwork Reduction Act of 1980 and

are found to impose a new information

collection requirement on the public.

Implementation of the new requirement

will be subject to approval by the Office

of Management and Budget.

Ordering Clauses

Accordingly, it is ordered that,

pursuant to sections 4(i), 4(j), 303(r),

612, 622(c) and 623 of the

Communications Act of 1934, as

amended, 47 U.S.C. 154(i), 154(j),

303(r), 532, 542(c) and 543, the rules,

requirements and policies discussed in

this Ninth Order on Reconsideration,

are adopted and part 76 of the

Commission’s rules, 47 CFR part 76, is

amended as set forth below.

It is further ordered that the Secretary

shall send a copy of this Order to the

Chief Counsel for Advocacy of the Small

Business Administration in accordance

with paragraph 603(a) of the Regulatory

Flexibility Act. Pub. L. No. 96–354, 94

Stat. 1164, 5 U.S.C. 601 et seq. (1981).

It is further ordered that the

requirements and regulations

established in this decision shall

become effective on April 1, 1995.

List of Subjects in 47 CFR Part 76

Cable television.

Federal Communications Commission.

William F. Caton,

Acting Secretary.

Title 47, Part 76 of the Code of

Federal Regulations is amended as

follows:

PART 76—CABLE TELEVISION

SERVICE

1. The authority citation for Part 76

continues to read as follows:

Authority: Secs. 2, 3, 4, 301, 303, 307, 308,

309, 48 Stat. as amended, 1064, 1065, 1066,

1081, 1082, 1083, 1084, 1085, 1101; 47 U.S.C.

Secs. 152, 153, 154, 301, 303, 307, 308, 309,

532, 535, 542, 543, 552 as amended, 106 Stat.

1460.

2. Section 76.922 is amended by

revising paragraph (d)(2) to read as

follows:

§ 76.922 Rates for the basic service tier

and cable programming service tiers.

* * * * *

(d) * * *

(2) Inflation Adjustments. The

residual component of a system’s

permitted charge may be adjusted

annually for inflation. The annual

inflation adjustment shall be based on

inflation occurring from June 30 of the

previous year to June 30 of the year in

which the inflation adjustment is made,

except that the first annual inflation

adjustment shall cover inflation from

September 30, 1993 until June 30 of the

year in which the inflation adjustment

is made. The adjustment may be made

after September 30, but no later than

August 31, of the next calendar year.

Adjustments shall be based on changes

in the Gross National Product Price

Index as published by the Bureau of

Economic Analysis of the United States

Department of Commerce. Cable

systems that establish a transition rate

pursuant to paragraph (b)(4) of this

section may not begin adjusting rates on

account of inflation before April 1,

1995. Between April 1, 1995 and August

31, 1995 cable systems that established

a transition rate may adjust their rates

to reflect the net of a 5.21% inflation

adjustment minus any inflation

adjustments they have already received.

Low price systems that had their March

31, 1994 rates above the benchmark, but

their full reduction rate below the

benchmark will be permitted to adjust

their rates to reflect the full 5.21%

inflation factor unless the rate reduction

was less than the inflation adjustment

received on an FCC Form 393 for rates

established prior to May 15, 1994. If the

rate reduction established by a low price

system that reduced its rate to the

benchmark was less than the inflation

adjustment received on an FCC Form

393, the system will be permitted to

receive the 5.21% inflation adjustment

minus the difference between the rate

reduction and the inflation adjustment

the system made on its FCC Form 393.

Cable systems that established a

transition rate may make future inflation

adjustments on an annual basis with all

other cable operators, no earlier than

October 1 of each year and no later than

August 31 of the following year to

reflect the final GNP–PI through June 30

of the applicable year.

* * * * *

[FR Doc. 95–4554 Filed 2–24–95; 8:45 am]

BILLING CODE 6712–01–M

DEPARTMENT OF COMMERCE

National Oceanic and Atmospheric

Administration

50 CFR Part 642

[Docket No. 940710–4292; I.D. 022195E]

Coastal Migratory Pelagic Resources

of the Gulf of Mexico and South

Atlantic; Closure of a Commercial

Fishery

AGENCY: National Marine Fisheries

Service (NMFS), National Oceanic and

Atmospheric Administration (NOAA),

Commerce.

ACTION: Closure of a commercial fishery

for king mackerel.

SUMMARY: NMFS closes the commercial

hook-and-line fishery for king mackerel