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If you need the complete document, download the WordPerfect version or Adobe Acrobat version, if available. ***************************************************************** Before the Federal Communications Commission Washington, D.C. 20554 In the Matter of ) ) Falcon Cable Systems Company ) CUID No. OR0340 (Cottage Grove) ) Complaint Regarding ) Cable Programming Services Tier ) Rate Increase ) ORDER Adopted: December 18, 1996Released: December 20, 1996 By the Chief, Financial Analysis and Compliance Division, Cable Services Bureau: 1.In this Order we consider a complaint against the June 1, 1996 rate increase by Falcon Cable Systems Company ("Falcon") for its cable programming services tier ("CPST") in Cottage Grove, Oregon, CUID No. OR0340. In response, Falcon submitted its FCC Form 1210 for the period January 1, 1995 through December 31, 1995. This Order addresses only the reasonableness of rate increase implemented by Falcon on June 1, 1996. We conclude that the CPST rate increase of $.18 Falcon began charging on June 1, 1996 is unreasonable. 2.Under the Communications Act, 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. If the Commission finds the rate unreasonable, it shall determine the correct rate and any refund liability. The Telecommunications Act of 1996 ("the 1996 Act") and our rules implementing the new legislation, require that complaints against the CPST rates be filed with the Commission by a franchising authority that has received subscriber complaints. A franchising authority may not file a CPST rate complaint unless, within 90 days after such increase becomes effective, it receives more than one subscriber complaint. 3.To justify rates for the period beginning May 15, 1994 through a benchmark or cost of service showing, operators must use the FCC Form 1200 series. Operators may also justify rate increases based on the addition and deletion of channels, the changes in certain external costs, and inflation by filing FCC Form 1210. FCC Form 1210 must be filed at least 30 days before new rates are scheduled to go into effect where the Commission has found the CPST rate to be unreasonable less than one year prior to the filing, or where there is a pending complaint against the CPST rate. 4.On October 4, 1996, Lane Council of Governments ("LCOG") on behalf of the Regional Cable Commission filed a complaint against Falcon's June 1, 1996 CPST rate increase in Cottage Grove. LCOG has certified that it has received subscriber complaints regarding the CPST rate increase within 90 days after the date the increase first appeared on the subscriber's cable bill. As required by our rules, LCOG's complaint also included a copy of Falcon's rate justification. 5.Upon review of Falcon's FCC Form 1210 filing for the period January 1, 1995 through December 31, 1995, we find that Falcon has not correctly calculated its maximum permitted rate. It is therefore appropriate to make the following adjustments to Falcon's calculations. We have adjusted the figure in Line A2 to exclude the franchise fees. Also, we have adjusted Falcon's external costs on Line C14 to agree with Falcon's previous FCC Form 1210 for the period April 1, 1994 to December 31, 1994. As a result of these adjustments, Falcon's calculated maximum permitted rate of $1.12 has been reduced to $1.03. We determine, however, that the total overcharge per subscriber is de minimis. Therefore, it would not serve the public interest to order a refund. 6.Accordingly, IT IS ORDERED, pursuant to Section 0.32l of the Commission's rules, 47 C.F.R. Section 0.321, that the monthly CPST rate increase of $.18 charged by Falcon in Cottage Grove, CUID NO. OR0340 beginning June 1, 1996 IS UNREASONABLE. 7.IT IS FURTHER ORDERED, pursuant to Section 0.32l of the Commission's rules, 47 C.F.R. Section 0.321, that Lane Council of Governments' complaint against the June 1, 1996 CPST rate increase, charged by Falcon in Cottage Grove, Oregon, CUID NO. OR0340 IS GRANTED TO THE EXTENT INDICATED HEREIN. 8.IT IS FURTHER ORDERED, pursuant to Section 0.32l of the Commission's rules, 47 C.F.R. Section 0.32,1 that Falcon Cable Systems Company revise its calculation of its maximum permitted CPST rate in its next filing. FEDERAL COMMUNICATIONS COMMISSION Elizabeth W. Beaty Chief, Financial Analysis and Compliance Division Cable ServicesBureau