******************************************************** 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 ) ) CUID Nos. MN0562 (Minnetrista) In the Matter of ) MN0563 (St. Bonifacius) ) MN0564 (Spring Park) ) MN0565 (Minnetonka Beach) Triax Midwest Associates, L.P. ) MN0566 (Excelsior) ) MN0567 (Orono) ) MN0568 (Medina) ) MN0569 (Wayzata) ) MN0570 (Shorewood) ) MN0571 (Tonka Bay) ) MN0572 (Long Lake) ) MN0573 (Greenwood) ) MN0574 (Deephaven) Complaints Regarding ) MN0575 (Woodland) Cable Programming Services Tier Rates ) MN0576 (Victoria) ) ORDER Adopted: December 17, 1997 Released: December 19, 1997 By the Deputy 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. We have already issued an order in which we found Operator's CPST rates in effect through January 31, 1996 to be reasonable ("Prior Order"). In our Prior Order, we also found Operator's CPST rates to be unreasonable beginning February 1, 1996 but we stayed Operator's refund liability for 30 days and allowed Operator to file any FCC forms which it previously failed to file to justify its February 1, 1996 CPST rate. In this Order, we vacate our Prior Order only to the extent it pertains to Operator's CPST rates in effect beginning February 1, 1996 and we address the reasonableness of those CPST rates based on our review of Operator's supplemental filings. 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 a rate to be unreasonable, it shall determine the correct rate and any refund liability. Operators may justify 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. 3. Upon review of Operator's FCC Form 1240 for the projected period February 1, 1996 through January 31, 1997, we find Operator's calculated maximum permitted rate ("MPR") of $14.77 to be reasonable. Because Operator's actual CPST rate of $14.71 does not exceed its MPR, we find Operator's actual CPST rate of $14.71, effective February 1, 1996 through January 31, 1997, to be reasonable. 4. Upon review of Operator's FCC Form 1240 for the projected period February 1, 1997 through January 31, 1998, we amended Operator's Line D6 (Current True-Up Segment) to coincide with Line I8 of Operator's prior FCC Form 1240 filing, in accordance with the FCC Form 1240 Instructions. We also amended Operator's Line D7 (Current Inflation Segment) to include the amount from Line I5 of its prior FCC Form 1240 per the FCC Form 1240 Instructions and Appendix A to DA 96-1804. Finally, we changed the number of months on Line E3 to three months in accordance with FCC Form 1240 Instructions. These adjustments resulted in a revised MPR of $13.74 for the projected period rather than Operator's MPR of $15.20 for the projected period. Because Operator's actual rate of $14.71, effective February 1, 1997 through February 28, 1997, exceeds its revised MPR of $13.74, we find Operator's actual CPST rate of $14.71, effective February 1, 1997 through February 28, 1997, to be unreasonable. Because Operator's actual CPST rate of $13.63, effective March 1, 1997, does not exceed its revised MPR, we find Operator's actual CPST rate of $13.63, effective March 1, 1997 through the present, to be reasonable. 5. 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 $14.71, charged by Operator in the franchise areas referenced above, effective February 1, 1996 through January 31, 1997, IS REASONABLE. 6. 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 $14.71, charged by Operator in the franchise areas referenced above effective February 1, 1997 through February 28, 1997, IS UNREASONABLE. 7. 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 $13.63, charged by Operator in the franchise areas referenced above effective March 1, 1997 through the present, IS REASONABLE. 8. 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 $13.74 per month (plus franchise fees), plus interest to the date of the refund, for the period February 1, 1997 through February 28, 1997. 9. 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. 10. IT IS FURTHER ORDERED, pursuant to Section 0.321 of the Commission's rules, 47 C.F.R.  0.321, that Operator take into account our FCC Form 1240 adjustment when calculating its maximum permitted rate and performing the true-up calculation on its next FCC Form 1240. 11. IT IS FURTHER ORDERED, that In The Matter of Triax Midwest Associates, L.P., DA 97- 1643, IS VACATED TO THE EXTENT INDICATED HEREIN. 12. 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 INDICATED HEREIN. FEDERAL COMMUNICATIONS COMMISSION John E. Logan Deputy Chief, Cable Services Bureau