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                            Before the
                Federal Communications Commission
                      Washington, D.C. 20554


                                 
In the Matter of                   )
                              )
TKR Cable Company                  )    CUID No. NY0794 (Orangetown)
                                        )              
Complaints Regarding               )
Cable Programming Services Tier         )               
Rate Increases                )

                              ORDER

     Adopted:  January 22, 1997            Released:  January 23, 1997
   
By the Chief, Cable Services Bureau:

     1. In this Order we consider complaints concerning the rate increases of TKR Cable
Company d/b/a TKR Cable Company of Rockland ("TKR") for its cable programming services tier
("CPST") in the Town of Orangetown ("Town"), CUID No. NY0794.  This Order addresses the
reasonableness of TKR's rates from November 29, 1993 to date.  TKR has attempted to justify its
CPST rates through benchmark showings on FCC Form 393, FCC Form 1200, FCC Forms 1210 and
FCC Form 1240.  We conclude, for the reasons discussed below, that the rates charged by TKR are
unreasonable. 

     2. The Federal Communications Commission ("Commission") has previously made a
determination of TKR's CPST rates in two communities in the Rockland system.  Our previous rate
review of the Rockland system appears to also apply to the Town.  TKR filed a Petition for
Reconsideration and Emergency Petition for Stay of that order on April 19, 1996.  The Commission
granted TKR's Emergency Petition for Stay on May 29, 1996.  TKR's Petition applied only to two
communities in the Rockland system, Clarkstown (CUID No. NY0449) and Montvale (CUID No.
NJ0489), and did not include the community in the immediate case, Orangetown (CUID No.
NY0794).  However, TKR's CPST rate in the Rockland system during the period September 1, 1993
through May 14, 1994 is under review by the Commission due to TKR's Petition for Reconsideration
and Stay.  This is not an order on reconsideration of that proceeding.  Nevertheless, in this order we
begin with the findings made in our original determination.

     3. The Communications Act authorizes the "Commission" 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")
required the Commission to review CPST rates upon the filing of a valid complaint by a subscriber
or local franchise authority ("LFA").  The Telecommunications Act of 1996 ("1996 Act") and our
rules implementing the new legislation, require that complaints against the CPST rates be filed with
the Commission only by an LFA that has received subscriber complaints.  An LFA may not file a
CPST rate complaint unless, within 90 days after such increase becomes effective, it receives more
than one subscriber complaint.  The filing of a valid complaint triggers an obligation on behalf of
the cable operator to file a justification of its CPST rates.  If the Commission finds the rate to be
unreasonable, it shall determine the correct rate and any refund liability.

     4.         The Commission's original rate regulations took effect on September 1, 1993.  The
Commission revised its rate regulations effective May 15, 1994.  Cable operators that have valid
CPST complaints filed against them prior to May 15, 1994 must demonstrate that  their CPST rates
were in compliance with the Commission's initial rules from the time the complaint was filed
through May 14, 1994.  Cable operators must also demonstrate that their rates were in compliance
with the revised rules from May 15, 1994 forward.  Cable operators attempting to justify their rates 
for the period beginning May 15, 1994 by a benchmark showing must use the FCC Form 1200
series.  Cable operators may also justify rate increases based on the addition and deletion of
channels, 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 when the
Commission has found the cable programming service rate to be unreasonable less than one  year
prior to the filing.  In addition, FCC Form 1210 may be filed where there is a pending complaint
against the CPST rate.

     5. Operators may justify adjustments to 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. 
Any incurred cost that is not projected may be accrued with interest and added to rates at a later
time. If actual and projected costs are different during the rate year a "true-up" mechanism is
available to correct estimated costs with actual cost changes.  The "true-up" requires operators to
decrease their rates or alternatively permits them to increase their rates to make an adjustment for
over or under estimations of these cost changes.

     6. On November 29, 1993, August 15, 1994 and March 31, 1995 valid complaints were
filed against the September 1993 CPST rate and the July 14, 1994 and March 6, 1995 CPST rate
increases that were implemented by TKR in the Town.  Accordingly, these complaints trigger the
Commission's jurisdiction to review TKR's CPST rates under the 1992 Cable Act.  In addition,
pursuant to the 1996 Act, the local franchise authority, State of New York Department of Public
Service ("State") filed a valid complaint on October 24, 1996, regarding TKR's CPST rate increase
on June 1, 1996.  

     7. Upon review of TKR's FCC Form 393, FCC Form 1200, multiple FCC Forms 1210 and
FCC Form 1240, we find that TKR charged in excess of its calculated maximum permitted rate or
has not correctly calculated its maximum permitted rate beginning November 29, 1993, as discussed
in the paragraphs below.

     8. FCC Form 393 Filing:  On October 4, 1994, TKR filed its FCC Form 393 to justify
CPST rates through May 14, 1994.  We find that TKR did not correctly calculate its maximum
permitted rate on this filing.  The correct maximum permitted rate from TKR's FCC Form 393 filing
was $10.99 pursuant to our previous rate review of the system for the period from September 1, 1993
to May 14, 1994.          

     9. FCC Forms 1200, 1210 and 1240 Filings:  On July 1, 1994, TKR filed its FCC Form
1200 to justify CPST rates in effect after May 14, 1994.  We find that TKR did not correctly
calculate its maximum permitted rate on this filing.  The correct maximum permitted rate from
TKR's previous FCC Form 393 filing was $10.99 pursuant to our rate review for the period from
September 1, 1993 to May 14, 1994.  We adjusted Module A, Line A6 of TKR's FCC Form 1200
to reflect the corrected previous permitted CPST rate of $10.99.  In addition, we corrected Line A1
and Module C, Line C2 to reflect the correct number of CPST channels and the correct number of
regulated non-broadcast channels as determined in our previous rate review.  These adjustments
resulted in a reduction of the maximum permitted rate for CPST to $12.05 from the rate of $12.34
filed by TKR.  However, TKR superseded this FCC Form 1200 filing with its first FCC Form 1210
filing.

     10.       On July 1, 1994, TKR filed an FCC Form 1210 to justify a rate increase of $1.06
effective July 14, 1994.  We find that TKR did not correctly calculate its maximum permitted rate
on this filing.  The correct maximum permitted rate from TKR's previous FCC Form 1200 filing was
$12.05.  We adjusted Module A, Line A2 of TKR's FCC Form 1210 to reflect the corrected previous
permitted rate to $12.05 for CPST.  On Module C, Line C2, TKR changed its channel line-up card
to reflect 22 channels on the CPST.  Accordingly, we have added one channel to the CPST to match
the new channel line-up card.  Our corrections reduced the maximum permitted rate for CPST from
$12.47 to $12.20.  Thus, TKR failed to demonstrate that its July 14, 1994 rate of $12.47 for its CPST
was not unreasonable.

     11.       On October 26, 1994, TKR filed an FCC Form 1210 to justify a CPST rate increase of
$0.22 effective February 1, 1995.  We find that TKR did not correctly calculate its maximum
permitted rate on this filing.  The correct maximum permitted rate from TKR's previous FCC Form
1210 filing was $12.20.  We adjusted TKR's FCC Form 1210 to reflect the corrected previous
permitted rate to $12.20 for CPST.  Upon review of this FCC Form 1210, we determined that, due
to increases in external costs, this filing justified a maximum permitted rate for the CPST of $12.41. 
Thus, TKR failed to demonstrate that its February 1, 1995 rate of $12.69 for its CPST was not
unreasonable.

     12.       On January 9, 1995, TKR filed an FCC Form 1210 to justify a CPST rate increase of
$0.73 effective March 6, 1995.  We find that TKR did not correctly calculate its maximum permitted
rate on this filing.  The correct maximum permitted rate from TKR's previous FCC Form 1210 filing
was $12.41.  We adjusted TKR's FCC Form 1210 to reflect the corrected previous permitted rate to
$12.41 for CPST.  Upon review of this FCC Form 1210, we determined that, due to the addition of
one channel to the CPST and increased inflation and external costs, this filing justified a maximum
permitted rate for the CPST of $13.14.  Thus, TKR failed to demonstrate that its March 6, 1995 rate
of $13.42 for its CPST was not unreasonable.

     13.       On February 29, 1996, TKR filed FCC Form 1240 to justify a CPST rate increase of
$1.68 effective June 1, 1996.  We adjusted Module A, Line A1 of this FCC Form 1240 to reflect the
corrected maximum permitted rate of $13.14 brought forward from the prior FCC Form 1210.  Our
adjustments to TKR's FCC Form 1240 resulted in a reduction of the maximum permitted rate for
CPST to $14.18 from the rate of $15.10 filed by TKR.  Thus, TKR failed to demonstrate that its June
1, 1996 rate of $15.10 for its CPST was not unreasonable.

     14.       Accordingly, IT IS ORDERED, pursuant to Section 0.321 of the Commission's rules,
47 C.F.R.  0.321, that the CPST rates charged by TKR in the Town of Orangetown, New York,
CUID No. NY0794, from November 29, 1993 to May 14, 1994, ARE UNREASONABLE.

     15.       IT IS FURTHER ORDERED, pursuant to Section 0.321 of the Commission's rules, 47
C.F.R.  0.321, that the CPST rates charged by TKR in the Town of Orangetown, New York, CUID
No. NY0794, from July 14, 1994 to January 31, 1995, ARE UNREASONABLE.

     16.       IT IS FURTHER ORDERED, pursuant to Section 0.321 of the Commission's rules, 47
C.F.R.  0.321, that the CPST rates charged by TKR in the Town of Orangetown, New York, CUID
No. NY0794, from February 1, 1995 to March 5, 1995, ARE UNREASONABLE.

     17.       IT IS FURTHER ORDERED, pursuant to Section 0.321 of the Commission's rules, 47
C.F.R.  0.321, that the CPST rates charged by TKR in the Town of Orangetown, New York, CUID
No. NY0794, from March 6, 1995 to May 31, 1996, ARE UNREASONABLE.
     
     18.       IT IS FURTHER ORDERED, pursuant to Section 0.321 of the Commission's rules, 47
C.F.R.  0.321, that the CPST rates charged by TKR in the Town of Orangetown, New York, CUID
No. NY0794, from June 1, 1996 to the present, ARE UNREASONABLE.

     19.       IT IS FURTHER ORDERED, pursuant to Section 0.321 of the Commission's rules, 47
C.F.R.  0.321, that the complaint against the CPST rates charged by TKR in the Town of
Orangetown, New York, CUID No. NY0794, from November 29, 1993 to May 14, 1994, IS
GRANTED TO THE EXTENT DISCUSSED HEREIN.

     20.       IT IS FURTHER ORDERED, pursuant to Section 0.321 of the Commission's rules, 47
C.F.R.  0.321, that the complaints against the CPST rates charged by TKR in the Town of
Orangetown, New York, CUID No. NY0794, from July 14, 1994 to January 31, 1995, ARE
GRANTED TO THE EXTENT DISCUSSED HEREIN.

     21.       IT IS FURTHER ORDERED, pursuant to Section 0.321 of the Commission's rules, 47
C.F.R.  0.321, that the complaints against the CPST rates charged by TKR in the Town of
Orangetown, New York, CUID No. NY0794, from March 6, 1995 to May 31, 1996, ARE
GRANTED TO THE EXTENT DISCUSSED HEREIN.

     22.       IT IS FURTHER ORDERED, pursuant to Section 0.321 of the Commission's rules, 47
C.F.R.  0.321, that the complaint against the CPST rates charged by TKR in the Town of
Orangetown, New York, CUID No. NY0794, from June 1, 1996 to the present, IS GRANTED TO
THE EXTENT DISCUSSED HEREIN.

     23.       IT IS FURTHER ORDERED, pursuant to Section 76.961 of the Commission's rules,
47 C.F.R.  76.961, that TKR shall refund to subscribers in CUID No. NY0794 that portion of the
amount paid in excess of the maximum permitted CPST rate of $10.99 per month (plus franchise
fee), plus interest to the date of the refund, for the period from November 29, 1993 to May 14, 1994.

     24.       IT IS FURTHER ORDERED, pursuant to Section 76.961 of the Commission's rules,
47 C.F.R.  76.961, that TKR shall refund to subscribers in CUID No. NY0794 that portion of the
amount of the CPST rate increase paid by subscribers that exceeded the maximum permitted CPST
rate of $12.20 per month (plus franchise fee), plus interest to the date of the refund, for the period
from July 14, 1994 to January 31, 1995.

     25.       IT IS FURTHER ORDERED, pursuant to Section 76.961 of the Commission's rules,
47 C.F.R.  76.961, that TKR shall refund to subscribers in CUID No. NY0794 that portion of the
amount of the CPST rate increase paid by subscribers that exceeded the maximum permitted CPST
rate of $12.41 per month (plus franchise fee), plus interest to the date of the refund, for the period
from February 1, 1995 to March 5, 1995.

     26.       IT IS FURTHER ORDERED, pursuant to Section 76.961 of the Commission's rules,
47 C.F.R.  76.961, that TKR shall refund to subscribers in CUID No. NY0794 that portion of the
amount of the CPST rate increase paid by subscribers that exceeded the maximum permitted CPST
rate of $13.14 per month (plus franchise fee), plus interest to the date of the refund, for the period
from March 6, 1995 to May 31, 1996.  

     27.       IT IS FURTHER ORDERED, pursuant to Section 76.961 of the Commission's rules,
47 C.F.R.  76.961, that TKR shall refund to subscribers in CUID No. NY0794 that portion of the
amount of the CPST rate increase paid by subscribers that exceeded the maximum permitted CPST
rate of $14.18 per month (plus franchise fee), plus interest to the date of the refund, for the period
from June 1, 1996 to the day before TKR implements the maximum permitted CPST rate of $14.18.

     28.       IT IS FURTHER ORDERED, pursuant to Section 0.321 of the Commission's rules, 47
C.F.R.  0.321, that TKR Cable Company d/b/a TKR Cable Company of Rockland, in the Town of
Orangetown, CUID No. NY0794, revise its calculation of its maximum permitted CPST rate in its
next FCC Form 1240 filing.

     29.       IT IS FURTHER ORDERED that TKR shall promptly determine the overcharges to
CPST subscribers for the stated periods, and shall within 30 days 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 within 60 days of Commission approval of the plan. 


                              FEDERAL COMMUNICATIONS COMMISSION 



                              Meredith J. Jones             
                              Chief, Cable Services Bureau