******************************************************** NOTICE ******************************************************** This document was converted from WordPerfect to ASCII Text format. Content from the original version of the document such as headers, footers, footnotes, endnotes, graphics, and page numbers will not show up in this text version. All text attributes such as bold, italic, underlining, etc. from the original document will not show up in this text version. Features of the original document layout such as columns, tables, line and letter spacing, pagination, and margins will not be preserved in the text version. 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 ) CUID Nos. HI0033 (Hana) ) HI0034 (Hihei/Wailea) TCI of Hawaii, Inc. ) HI0035 (Wailuki/Hahului) ) HI0037 (Makawao/Pukalani) Complaint Regarding ) HI0087 (Paia) Cable Programming Services Tier Rates) HI0089 (Maalaea) ) HI0100 (Kula) ) ORDER Adopted: March 14, 1997 Released: March 19, 1997 By the Chief, Cable Services Bureau: 1. In this Order we consider complaints about the rates charged by the above- referenced operator ("Operator") for its cable programming services tier ("CPST") in the communities referenced above. Operator has attempted to justify its CPST rates through benchmark justifications on FCC Forms 1200 and 1210. We have already issued a separate order in which we found that Operator's rates in effect before May 15, 1994 were unreasonable ("Prior Order"). Accordingly, this Order addresses only the reasonableness of Operator's CPST rates in effect after May 14, 1994. 2. Under the Communications Act, the 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 rates to be unreasonable, it shall determine correct rates and any refund liability. 3. Upon review of Operator's FCC Form 1200 and 1210's for the period May 15, 1994 through March 31, 1996, we find that Operator charged in excess of its calculated maximum permitted rate ("MPR") or has not correctly calculated its MPR beginning May 15, 1994, as discussed in the paragraphs below. 4. FCC Form 1200. We adjusted Operator's FCC Form 1200 so that Operator's monthly charge as of March 31, 1994 agreed with the rate of $12.81 specified in our Prior Order. This adjustment did not affect Operator's MPR of $12.69. Operator's actual CPST rate at the time was $12.87. We find that Operator's CPST rate of $12.87 for the period May 15, 1994 through June 30, 1994, has exceeded its MPR by $.18. Thus, Operator has failed to demonstrate that its May 15, 1994 CPST rate of $12.87 was reasonable. 5. FCC Form 1210's. We adjusted Operator's FCC Form 1210 for the period April 1, 1994 through June 30, 1994 to reflect the amendment noted above. This adjustment did not affect Operator's MPR of $12.87. Therefore, we find Operator's actual CPST rate of $12.85 for the period July 1, 1994 through July 31, 1995 to be reasonable. 6. Next, we adjusted Operator's FCC Form 1210 for the period October 1, 1994 through December 1, 1994 to reflect the above-referenced change and to correct the entry for previous per subscriber external costs to agree with the prior FCC Form 1210. These adjustments resulted in a revised MPR of $13.18 rather than Operator's MPR of $13.32. We find that the actual CPST rate of $13.32 charged for the period August 1, 1995 through March 31, 1996 exceeded Operator's revised MPR by $.14. Thus, Operator has failed to demonstrate that its August 1, 1995 CPST rate of $13.32 was reasonable. 7. Finally, we adjusted Operator's FCC Form 1210 for the period January 1, 1995 through March 31, 1996 to reflect our earlier amendments, reducing the MPR to $13.23 rather than Operator's MPR of $13.37. Operator has therefore justifed a MPR of $13.23 beginning April 1, 1996. Operator has failed to demonstrate that its MPR of $13.37 beginning April 1, 1996 was reasonable. 8. Accordingly, IT IS ORDERED, pursuant to Section 0.321 of the Commission's rules, 47 C.F.R.  0.321, that the CPST rate of $12.87, charged by Operator in the franchise areas referenced above during the period May 15, 1994 through June 30, 1994 IS UNREASONABLE. 9. IT IS FURTHER ORDERED, pursuant to Section 0.321 of the Commission's rules, 47 C.F.R.  0.321, that the CPST rate of $12.85, charged by Operator in the franchise areas referenced above during the period July 1, 1994 through July 31, 1995, IS REASONABLE. 10. IT IS FURTHER ORDERED, pursuant to Section 0.321 of the Commission's rules, 47 C.F.R.  0.321, that the CPST rate of $13.32, charged by Operator in the franchise areas referenced above during the period August 1, 1995 through March 31, 1996, IS UNREASONABLE. 11. 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 community referenced above that portion of the amount paid in excess of the maximum permitted CPST rate of $12.69 per month (plus franchise fees), plus interest to the date of the refund, for the period May 15, 1994 through June 30, 1994. 12. 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 community referenced above that portion of the amount paid in excess of the maximum permitted CPST rate of $13.18 per month (plus franchise fees), plus interest to the date of the refund, for the period August 1, 1995 through March 31, 1996. 13. 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 community referenced above that portion of the amount paid in excess of the maximum permitted CPST rate of $13.23 per month (plus franchise fees), plus interest to the date of the refund, for the period April 1, 1996 to the day Operator implements the maximum permitted CPST rate of $13.23. 14. IT IS FURTHER ORDERED that Operator 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. 15. IT IS FURTHER ORDERED, pursuant to Section 0.321 of the Commission's rules, 47 C.F.R.  0.321, that the referenced complaints ARE GRANTED TO THE EXTENT DISCUSSED HEREIN. FEDERAL COMMUNICATIONS COMMISSION Meredith J. Jones Chief, Cable Services Bureau