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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 ) ) Triax Cablevision, USA, L.P. ) CUID No. IN0510 (City of Francisco) ) Small System Filing to Support ) Cable Programming Services Tier Rates) ORDER Adopted: September 19, 1997 Released: September 24, 1997 By the Acting Chief, Financial Analysis and Compliance Division, Cable Services Bureau: 1. In this Order we consider complaints filed with the Federal Communications Commission ("Commission") on February 14, 1994 and March 10, 1995 regarding the rates that the above captioned- operator ("Operator") was charging for its cable programming services tier ("CPST") in the franchise area referenced above. On November 3, 1995, Operator filed FCC Form 1230, seeking to justify its CPST rate through the simplified small system cost of service procedures under the Sixth Report and Order and Eleventh Order on Reconsideration, MM Docket Nos. 92-266 and 93-215 ("Small System Order"). We will grant Operator's request for small system relief under the Small System Order and, based on our review of Operator's FCC Form 1230 filing, deny the February 14, 1994 CPST complaint and find the CPST rate to be not unreasonable. We will also grant Operator's Motion to Dismiss the March 10, 1995 CPST complaint. 2. Under the Communications Act and the Commission's rules, the Commission must review a cable operator's rate for its CPST upon the filing of a valid complaint. The filing of a valid complaint triggers an obligation on behalf of the cable operator to file a justification of its CPST rate. Under the Commission's rules, an operator may attempt to justify its CPST rate through a benchmark showing, a cost of service showing, or a small system cost of service showing. In any case, the operator has the burden of demonstrating that its rate is not unreasonable. 3. On March 17, 1995, Operator filed a Motion to Dismiss the March 10, 1995 complaint on the ground that the complainant incorrectly answered Line 7 of the FCC Form 329 that asks for the current monthly rate. Operator alleges that Complainant combined both the basic and expanded service rates. Operator also requests that the complaint be dismissed because the CPST rate did not change on March 1, 1995 as indicated by Complainant's completion of question 8 (c). 4. We agree with Operator's assertions. Though the combination of the basic and expanded rates alone may not be dispositive, the accompanying cable bill, submitted by Complainant reflects that the March 1, 1995 rate increase applies to the basic service tier only. In response to question 8(c) of the FCC Form 329, Complainant reported that no channels were changed. Commission rules require that a CPST complaint filed after February 28, 1994 may be filed against a cable operator only in the event of a rate change. We therefore find that the March 10, 1995 complaint is invalid and grant Operator's Motions to Dismiss. 5. The Commission's original rate regulations took effect on September 1, 1993. The Commission subsequently revised its rate regulations effective May 15, 1994. In a further effort to offer small cable companies administrative relief from rate regulation, the Commission amended the definition of small cable companies and small systems and introduced a simplified form of small system rate relief in the Small System Order. Cable systems serving 15,000 or fewer subscribers, and owned by a company having 400,000 or fewer subscribers, may elect to use the small cable system rate mechanism in lieu of other Commission rate processes, provided the Commission has not reached a final resolution on the rate complaints filed against the system. Operators attempting to justify their rates through small system relief must file FCC Form 1230. FCC Form 1230 requires that the Operator Selected Per Subscriber Monthly Programming Rate Per Channel (FCC Form 1230, Line A11) not exceed the Per Subscriber, Per Channel Monthly Programming Costs (FCC Form 1230, Line A6). If the maximum rate established on FCC Form 1230 does not exceed $1.24 per channel, the rate shall be presumed reasonable. 6. On November 3, 1995, Operator filed FCC Form 1230 seeking to justify its CPST rate through the simplified small system cost of service procedures under the Commission's Small System Order. In support of its rate justification, (1) the Operator stated the company had "approximately 340,000 basic subscribers" and (2) the Operator's FCC Form 1230 indicates, on Line A2, that the system in question had a total of 200 subscribers. We find that at the time of the filing of its FCC Form 1230, Operator was a company with fewer than 400,000 total subscribers. We also find that the system in question served fewer than 15,000 subscribers, making it eligible for small system relief. Upon review of Operator's FCC Form 1230, we find Operator's actual CPST rate of $14.70, as reported on Line All, is not unreasonable. 7. Accordingly, IT IS ORDERED, pursuant to Section 76.934 of the Commission's rules, 47 C.F.R. 76.934, that Operator's request for small system relief IS GRANTED. 8. IT IS FURTHER ORDERED that the CPST rate of $14.70 charged in the community referenced above IS NOT UNREASONABLE. 9. IT IS FURTHER ORDERED that the complaint against the February 14, 1994 CPST rate charged by Operator during the period under review in the community referenced above IS DENIED. 10. IT IS FURTHER ORDERED, pursuant to Section 0.321 of the Commission's rules, 47 C.F.R. Section 0.321, that the Motion to Dismiss the March 10, 1995 complaint filed against the CPST rate charged by Operator in the community referenced above, IS GRANTED, and the March 10, 1995 CPST complaint IS DISMISSED. 11. This action is taken pursuant to delegated authority under Section 0.321 of the Commission's rules, 47 C.F.R. 0.321. FEDERAL COMMUNICATIONS COMMISSION Margaret M. Egler Acting Chief, Financial Analysis and Compliance Division Cable Services Bureau