WPC8= 2MB<RK Z3|j Times New RomanTimes New Roman BoldTimes New Roman Italic"i~'^:DPddDDDdp4D48dddddddddd88pppX|pDL|pp||D8D\dDXdXdXDdd88d8ddddDL8ddddX`(`lD4l\DDD4DDDDDDDDd8XXXXXX|X|X|X|XD8D8D8D8ddddddddddXdbdddpdXXXXXlX~|X|X|X|XdddldldD8DdDDDdplld|8|P|D|D|8dvddddDDDpLpLpLpl|T|8|\ddddddl|X|X|Xd|DdpL|Dd~4ddC$CWxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxNHxxH\dDXddddd8@d<@d<DDXXdDDxddzHxxHvppDXd<"dxtldpxxdHP4Si; LPT1; Rm. 907_1HPLAS4SI.PRSXP\  P6Q\LSXP2eE%K X-#Xj\  P6G;yoXP#3|o Times New RomanTimes New Roman Boldj\  P6G;XP#"i~'^:DpddȨDDDdp4D48ddddddddddDDpppd|Ld|pȐD8DtdDdpXpXDdp8Dp8pdppXLDpdddXP,PhD4htDDD4DDDDDDdDp8dddddȐXXXXXJ8J8J8J8pddddppppddpddddzpdddXXhXXXXXdddhdptL8LpLDLpphhp8ZDP8pppddƐXXXpLpLpLphfDtppppppȐhXXXpDppLDd4ddC6CWxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxNHxxHjdDdddddd -ԍxWe note that Arbitron, the company that establishes the boundaries for ADIs, has ceased updating its ADI market list. Commission staff is currently exploring the designation of a replacement measure. would be  X-appropriate for the setting of uniform rates. We seek comment on additional benefits of limiting uniform ratesetting to franchise areas located within the same ADI or similar region, as well as any difficulties resulting from this limitation. We further seek comment on the benefits or detriments of limiting uniform rates to franchise areas located within the same county or state. Finally, we seek comment on the costs and benefits of permitting cable operators to select the region in which to set uniform rates under a uniform ratesetting method. x` `  X -x` ` 15. Below we describe two possible approaches for permitting cable operators to establish uniform rates for uniform packages of services offered to multiple franchise areas. We invite comment from interested parties as to these approaches and we seek suggestions as to any other alternatives that would further the goals discussed above.  X -x` ` 16. The first approach would work generally as follows. A cable operator first would determine or identify BST and CPST rates established in each local franchise area pursuant to our existing rate regulations, as adjusted to reflect permitted or required rate changes resulting from the addition or deletion of channels necessary to structure uniform tiers throughout the franchise areas served. We seek comment on whether an operator would similarly follow our existing regulations concerning rates for equipment. BST rates then would be equalized by reducing all BST rates charged in the relevant region to the lowest regulated BST rate charged in any one franchise area located in the region. The new uniform BST rate would now constitute the operator's maximum permitted rate for basic cable service in all the relevant franchise areas. The operator then would add the total amount of "lost" revenue resulting from the various BST rate reductions to the total CPST revenues to which the operator is otherwise entitled, under our existing rules, for all franchise areas in the relevant region. The operator then would determine a uniform CPST rate by dividing the total of the displaced BST revenues and existing CPST revenues by all CPST"|' 0*(("  X-subscribers in the region.o Xy-ԍxA numerical example of this option can be found in Appendix A.o Thereafter, the operator would apply our goingforward policies and annual rate adjustment regulations on a regional basis.  X-x` ` 17.  In some instances, cable systems may be regulated in certain franchise areas within the region and unregulated in others. We propose that operators be free to establish uniform rates under the uniform ratesetting approach in unregulated as well as regulated franchise areas for purposes of uniformity. We believe that in such situations, an operator may elect to base uniform rates in part on data from unregulated areas only if such uniform rates also are charged in the unregulated areas. We believe that this optional approach further enhances operators' flexibility in establishing uniform rates. Moreover, uniform rates calculated pursuant to the method ultimately adopted in this proceeding, and charged in unregulated areas, should increase an operator's regulatory certainty with respect to whether the subscriber rates charged in the unregulated areas are reasonable under our rules  X -should the operator later become subject to rate regulation in one of those areas.R y X-ԍxAn operator later becoming subject to regulation would follow our existing procedures for establishing regulated rates, including determining an initial rate pursuant to our benchmark formula or costofservice rules, and seeking the approval of rates from the local franchising authority.R We seek comment on this approach. We also seek comment on how an operator's regulated rates for equipment may affect the setting of uniform rates.  Xy-x` ` 18. An operator's rates would remain subject to the dual jurisdictions of the affected local franchising authorities and the Commission. Upon the initial application of this approach, BST rates would be unchanged in at least one franchise area and would be reduced in each franchise area with higher rates. Thus, this proposal may benefit many subscribers who receive only basic cable service, and should be costneutral to the remaining basiconly subscribers in the franchise area(s) with the lowest current BST rates. Certified local franchising authorities would retain jurisdiction to ensure that the operator's BST rates are in compliance with our rules. The operator would recoup the costs of reduced BST rates through the averaged CPST rates over which the Commission would retain jurisdiction. We seek comment on this proposed approach, including comment on: (1) the costs and benefits of requiring operators to reduce BST rates to the lowest common rate under this option, (2) the impact of an operator's redistribution of BST rate reductions among CPST rates charged in neighboring franchise areas, and (3) the application of our goingforward policies and annual rate adjustment on a regional basis. We note that our rules allow franchising authorities to review and approve operators' proposed BST rates and increases to those rates. Under this option, however, preapproval of uniform BST rates by franchising authorities generally will be unnecessary given that subscriber rates typically will decrease or remain unchanged. We seek comment on the benefits and costs of this approach for local franchising authorities, and whether this approach will protect subscribers from unreasonable rates."0*(("Ԍ X-ԙx` ` 19. Under the second possible approach for establishing uniform rates for uniform services, a cable operator would determine or identify BST and CPST rates charged in each of the relevant franchise areas pursuant to our existing rate regulations, as adjusted for rate changes resulting from the addition or deletion of channels necessary to structure uniform service tiers. We seek comment on whether an operator similarly would follow our existing regulations concerning rates for equipment. After aggregating the BST rates and revenues for all the franchise areas in the region, and then the CPST rates and revenues for all franchise areas, the operator would determine a single "blended" rate for BSTs, and a single blended rate for CPSTs, to be charged in all franchise areas in the region pursuant to a formula designed by the Commission. The blended rates for BSTs and CPSTs would be determined by averaging the operator's total BST and CPST rates, respectively, on a per subscriber basis for all subscribers in the region, in order to ensure that the establishment  X -of uniform rates is revenueneutral to the cable operator.o  Xe -ԍxA numerical example of this option can be found in Appendix A.o The operator would be required to justify its blended rates to each local franchising authority certified to regulate rates. The operator would be free, of course, to establish this rate in uncertified franchise areas, for purposes of uniformity across a wide region. As noted for the other proposed approach, we propose that an operator may elect to base uniform rates in part on data from unregulated areas only if such uniform rates also are charged in the unregulated areas, and believe that similar benefits for operators and subscribers will result from this requirement under both  XK-possible approaches. We seek comment on this tentative conclusion, as well as comment on other benefits and detriments of the cable operator basing the blended rate in part on data from such unregulated areas. We also seek comment on how an operator's establishment of uniform rates in uncertified areas may impact on the operator's ability to later implement required refunds or prospective rate reductions in certified areas.  X-x` ` 20.  After setting initial uniform rates, the operator would apply our goingforward policies and the recently adopted annual adjustment method on a regional basis to adjust future rates. Again, the dual jurisdictional boundaries of franchising authorities and the Commission would remain intact. We seek comment on this approach generally, including comment on: (1) any associated burdens for regulated cable companies and regulators, (2) whether this approach would protect cable subscribers from unreasonable rates in accordance with the 1992 Cable Act, (3) the proposed calculation of the blended rate, and (4) the application of our goingforward policies and annual adjustment method on a regional basis. We note that under this approach subscribers' BST rates may increase in certain jurisdictions (and decrease in others) as BST rates are adjusted to establish uniformity. We seek comment on the benefits and costs of adopting this formula given that certain BST subscribers may experience rate increases.  X"-x` ` 21.  Both proposed uniform rate setting methodologies will result in increases in CPST rates for some subscribers. In light of the cost savings to cable operators likely to be created by implementation of uniform rates, we seek comment on whether it is"h$ y0*((F#" appropriate to either limit the amount of increase a CPST subscriber must pay in a given year as a result of the institution of uniform rates or to phasein significant increases over a twoyear period. Comments should also address what administrative burdens such a limitation or phasedin increase would create for operators.  X-  X-x` ` 22. Several potential timing circumstances may affect the implementation of a uniform ratesetting approach. For example, where an operator has submitted justifications, the operator may be subject to multiple local tolling orders of varying  XH-durations which can complicate implementation of uniform BST rates.: H X -ԍxAfter the initial 30 day notice period that must precede any rate adjustment, franchising authorities can toll the effective date of a proposed rate for an additional 90 days in benchmark cases or 150 days in cost of service cases. 47 C.F.R.  76.922(b)(1)(2).: We seek suggestions of procedures that would permit a cable operator in this situation to establish uniform rates as expeditiously as possible. We solicit comment on allowing proposed uniform rates to take effect automatically after some period of time, subject to ultimate resolution in a later "truingup" process, in which rate discrepancies could be reflected in rates for the following year.  X -x` ` 23. In proposing to give cable operators flexibility to charge uniform rates for uniform services, we in no way seek to circumscribe the authority of local franchising authorities to negotiate franchisespecific terms in their agreements with cable operators. For example, we note that local franchising authorities typically establish requirements in a franchise agreement with respect to the designation or use of the franchised  XK-cable operator's channel capacity for PEG services.Q!KK XG-ԍxCommunications Act,  611(a).Q This could result in a cable system having a nonuniform channel lineup within franchise areas where it seeks to establish uniform rates. We seek comment on whether our uniform rate proposals require any  X-modification or adjustment to accommodate such nonuniform offerings.  X-x` ` 24. A further problem may arise because PEG requirements and other franchise obligations will vary between franchise areas, such that the operator's "franchise  X-related costs," one of the variables used to establish and adjust rates,X" XW-ԍx47 C.F.R.  76.922(d)(3)(iv)(B)(C).X also will vary among franchise areas. We seek to provide cable operators with uniform rate alternatives while allowing franchising authorities flexibility to negotiate franchise terms and conditions that respond to particular community needs. We also seek to ensure that the uniform rate proposal does not allow franchisespecific costs to be shifted from one community to another. One alternative for resolving this issue would be to permit the cable operator simply to itemize and  X -charge for franchiserelated costs outside the uniform ratesetting formula. We seek comment on this approach. We also seek suggestions of other methods that could compensate operators for legitimately incurred expenses while protecting subscribers from unreasonable rates. Finally, we seek comment on additional potential obstacles to the establishment of uniform" "0*((" rates and service offerings, and possible resolutions to such obstacles.  X- IV.XxInitial Regulatory Flexibility Act Analysis (#  X-x` ` 25. Pursuant to Section 603 of the Regulatory Flexibility Act, the Commission has prepared the following initial regulatory flexibility analysis ("IRFA") of the expected impact of these proposed policies and rules on small entities. Written public comments are requested on the IRFA. These comments must be filed in accordance with the  XH-same filing deadlines as comments on the rest of the NPRM, but they must have a separate and distinct heading designating them as responses to the regulatory flexibility analysis. The  X -Secretary shall cause a copy of the NPRM, including the initial regulatory flexibility analysis, to be sent to the Chief Counsel for Advocacy of the Small Business Administration in accordance with Section 603(a) of the Regulatory Flexibility Act, Pub. L. No. 96354, 94  X -Stat. 1164, 5 U.S.C.  601 et seq. (1981).  X -x` ` 26. Reason for Action. The Commission has perceived that our cable service rate regulations may impede a cable operator's ability to establish uniform rates for uniform services offered in multiple clustered franchise areas. We believe that allowing operators to set such uniform rates may facilitate operators' regional marketing of services, reduce administrative burdens on both regulators and cable companies, and reduce consumer  X<-confusion resulting from disparate rates. The NPRM proposes two possible alternatives for setting uniform rates, and solicits comments on further approaches. x` `  X-x` ` 27. Objectives. To explore a method under which a cable operator could establish uniform rates for uniform services offered in multiple franchise areas.  X-x` ` 28. Legal Basis. Action as proposed for this rulemaking is contained in Section 623 of the Communications Act of 1934, as amended, 47 U.S.C. 543.  Xs-x` ` 29. Description, Potential Impact and Number of Small Entities Affected. The proposals, if adopted, will not have a significant effect on a substantial number of small entities.  X-x` ` 30. Reporting, Recordkeeping and Other Compliance Requirements. None.  X -x` ` 31. Federal Rules which Overlap, Duplicate or Conflict with these  X!-Rules. None.  X#-x` ` 32. Any Significant Alternatives Minimizing Impact on Small Entities  X$-and Consistent with Stated Objectives. None.  XT&- V.xPAPERWORK REDUCTION ACT "=' "0*((%"Ԍ X-x` `  33.  This NPRM contains either a proposed or modified information collection. The Commission, as part of its continuing effort to reduce paperwork burdens, invites the general public and the Office of Management and Budget (OMB) to comment on the information collections contained in this NPRM, as required by the Paperwork Reduction Act of 1995, Pub. L. No. 10413. Public and agency comments are due at the same time as other comments on this NPRM; OMB comments are due 60 days from date of publication of this NPRM in the Federal Register. Comments should address: (a) whether the proposed collection of information is necessary for the proper performance of the functions of the Commission, including whether the information shall have practical utility; (b) the accuracy of the Commission's burden estimates; (c) ways to enhance the quality, utility, and clarity of the information collected; and (d) ways to minimize the burden of the collection of information on the respondents, including the use of automated collection techniques or other forms of information technology.  X - VI.xPROCEDURAL PROVISIONS  X{-x` ` !34. Ex parte Rules NonRestricted Proceeding. This is a nonrestricted notice and comment rulemaking proceeding. Ex parte presentations are permitted, except during the Sunshine Agenda period, provided that they are disclosed as provided in  X8-Commission's rules. See generally 47 C.F.R.  1.1202, 1.1203, and 1.1206(a).  X -x` ` "35. To file formally in this proceeding, you must file an original plus four copies of all comments, reply comments, and supporting comments. If you want each Commissioner to receive a personal copy of your comments and reply comments, you must file an original plus nine copies. You should send comments and reply comments to Office of the Secretary, Federal Communications Commission, 1919 M Street, N.W. Washington, D.C. 20554. Comments and reply comments will be available for public inspection during regular business hours in the FCC Reference Center, Room 239, Federal Communications Commission, 1919 M Street N.W., Washington D.C. 20554.  X=-x` ` #36.  In addition to filing comments with the Secretary, a copy of any comments on the information collections contained herein should be submitted to Dorothy Conway, Federal Communications Commission, Room 234, 1919 M Street, N.W., Washington, DC 20554, or via the Internet to dconway@fcc.gov, and to Timothy Fain, OMB Desk Officer, 10236 NEOB, 725 17th Street, N.W., Washington, DC 20503 or via the Internet to fain_t@al.eop.gov.  X"-x` ` $37.  For additional information concerning the information collections  X#-contained in this NPRM contact Dorothy Conway at 2024180217, or via the Internet at dconway@fcc.gov.  XB&- VII.xORDERING CLAUSES "+' "0*((%"Ԍ X-x` ` %38. IT IS ORDERED that, pursuant to Sections 623 of the Communications Act of 1934, as amended, 47 U.S.C. 543, NOTICE IS HEREBY GIVEN of proposed amendments to Part 76, in accordance with the proposals, discussions, and  X-statement of issues in this NPRM, and that COMMENT IS SOUGHT regarding such proposals, discussion, and statement of issues. Comments are due by January 12, 1996, and reply comments are due by February 12, 1996.  Xa-x` ` &39. IT IS FURTHER ORDERED that the Secretary shall send a copy of  XJ-this NPRM, including the Initial Regulatory Flexibility Analysis, to the Chief Counsel for Advocacy of the Small Business Administration in accordance with paragraph 603(a) of the  X -Regulatory Flexibility Act, Pub. L. No. 96354, 94 Stat. 1164, 5 U.S.C.  601 et seq. (1981). x` ` hhFEDERAL COMMUNICATIONS COMMISSION x` ` hhWilliam F. Caton  Xh-x` ` hhActing Secretary "Q "0*(("  X-A  Appendix A: Examples of Proposed Methods ĐTPx  X-Current Rates` `  Franchise A@hppFranchise B  xx 0 X-Franchise C  X-X` hp x (#%'0*,.8135@8: