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A. 1. a.(1)(a) i) a) 1. 1. 1. a.(1)(a) i) a)#Xj\  P6G;9XP##&a\  P6G;&P#"i~'^5>g\\>>>\g0>03\\\\\\\\\\>>ggg\yyrF\yrgyy>3>j\>\gQgQ>\g3>g3g\ggQF>g\\\QI(I_>0_j>>>0>>>>>>\>g3\\\\\QyQyQyQyQD3D3D3D3g\\\\gggg\\g\\\\pg\\\QQ_QyQyQyQyQ\\\_\gjF3FgF>Fgg__gy3ySy>yIy3ggg\\QQQgFgFgFg_y^y>yjgggggg_yQyQyQgy>ggFy>\0\\=2=WxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxNBnnBa\>\\\\\\7>\7>\7>>\\\??n\\pBnnBsgg>\\7"yyyy\nlc\gnn\2KKKaK"i~'^:DpddȨDDDdp4D48ddddddddddDDpppd|Ld|pȐD8DtdDdpXpXDdp8Dp8pdppXLDpdddXP,PhD4htDDD4DDDDDDdDp8dddddȐXXXXXJ8J8J8J8pddddppppddpddddzpdddXXhXXXXXdddhdptL8LpLDLpphhp8ZDP8pppddƐXXXpLpLpLphfDtppppppȐhXXXpDppLDd4ddC6CWxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxNHxxHjdDdddddd%7777777777>>>0eOIIOD>OO%*ODaOO>OI>DOOgOOD%%37%07070%777V7777%*77O77055;%;3%%%%%%%%%%%7O0O0O0O0O0aHI0D0D0D0D0%%%%O7O7O7O7O7O7O7O7O7O7O0O7O6O7O7O7>7O0O0O0I0I0I;I0OED0D0D0D0O7O7O7O;O7O;O7%%7%%%7M>;;O7DD,D%D%DO7AO7O7O7O7aOI%I%I%>*>*>*>;D.DD3O7O7O7O7O7O7gOO;D0D0D0O7D%O7>*D%O7E77%%WMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxN(BB(37%07777j7#TT7!#TT7T!%%007n&&Bn77lCTn(nBB(A\\>>n%07\n!"IIIITTenn7TnB@;7>lBBn7"i~'^"(22TN"""28"2222222222888,\HBBH>8HH"&H>XHH8HB8>HH^HH>"".2",2,2,"222N2222"&22H22,006"6."""""""""""2H,H,H,H,H,XAB,>,>,>,>,""""H2H2H2H2H2H2H2H2H2H2H,H2H1H2H2H282H,H,H,B,B,B6B,H?>,>,>,>,H2H2H2H6H2H6H2""2"""2F866H2>>(>">">H2;H2H2H2H2XHB"B"B"8&8&8&86>*>>.H2H2H2H2H2H2^HH6>,>,>,H2>"H28&>"H2?22!!WFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxN$<<$.2",2222`2 LL2 LL2L"",,2d""HH^HH>"".2",2,2,"222N2222"&22H22,006"6."""""""""""2H,H,H,H,H,>,>,>,>,""""H2H2H2H2H2H2H2H2H2H2H,H2H1H2H2H282H,H,H,B,B,B6B,H?>,>,>,>,H2H2H X- X    S-  Federal Communications Commission`}(#DA 981269 ă  yxdddy Պ+2 #Xj\  P6G;9XP#Before the w Federal Communications Commission  X-Washington, D.C. 20554 ă  S-#&a\  P6G;&P#In the Matter of:R)hpp  S|-R)hppAguada  PR0028  ST-Cable TV Del NoroesteR)hppAguadilla  PR0029  S,-R)hppIsabela  PR0030  S-For Reconsideration of the CertificationR)hppMoca  PR0031  S-of the Puerto Rico TelecommunicationsR)hppQuebradillas  PR0032 Regulatory Board To RegulateR) Basic Cable RatesR)  S -  MEMORANDUM OPINION AND ORDER TP  S -X` hp x (#%'0*,.8135@8:Second, Cable TV argues that there has been significant population growth in the franchise area since  Sh-1990. h] {O$- xZԍId. See Exhibit 2 (Cable TV submits Estimates of Population of Puerto Rico Municipios as of July 1, 1996 provided by the U.S. Bureau of the Census). "@ ,`(`(88r"Ԍ S- ` x5.` ` Cable TV states that it completed an audit of the number of households in the franchise  xjarea by consulting original and updated street maps of each cable community and by conducting a house S- xbyhouse count of each residence. ] {O- x<ԍPetition at 3. See Exhibit 1 (Declaration of General Manager of Cable TV regarding audit of the number of households in the franchise area.) Cable TV maintains that the audit, which was conducted during the  S- xperiod October, 1992 through November, 1993, indicates that the number of homes are 16,440 in Aguada,  x22,595 homes in Aguadilla, 15,420 homes in Isabela, 18,365 in Moca, and 10,470 in Quebradillas for a  S8- xtotal of 83,290 households in the franchise area.; 8"] yO-ԍPetition at 2, n.1.; Cable TV states that it currently serves 21,750 or 26.1  xpercent of the households in the franchise area. Cable TV thus argues that it is subject to low penetration effective competition and that the Board's certification to regulate rates should be revoked.  S- ` x6.` ` In opposition, the Board asserts that Cable TV has not adequately demonstrated that it  xmeets the requirements of the low penetration test. The Board argues that Cable TV does not want to rely  xon 1990 Census data because that data would show that Cable TV's penetration rate is well over 30  xpercent of the households in the franchise area. The Board further argues that, other than its houseby xhouse survey, Cable TV fails to explain its methodology to determine current households including the  xcalculation of occupancy rates, changes in population, zoning changes and other variables that must be  xconsidered in preparing household estimates. The Board further argues that Cable TV fails to provide a full explanation of how the audit was conducted.  S0- ` ox7.` ` The Board argues that reliable data, i.e., 1990 Census data, show that the franchise area  S- xhad 63,670 households in 1990 which, when compared to Cable TV's current subscribership (21,750),  xjmakes Cable TV's penetration rate 34.16 percent. The Board further argues that Cable TV's penetration  x=rate doesn't satisfy the low penetration test using reliable updated household data. The Board estimates  xthat there are 69,825 current households in the franchise area. The Board arrived at this figure using 1996  Sh- xyCensus population estimates for each of the cable communities in the franchise area h] {O- xԍOpposition at 6. See Exhibits 1 (Board Calculation of Cable Penetration Rates) and 2 (U.S. Census Bureau data). which it divided by  xthe average number of persons per household in each of the Communities. The Board's estimate of  xcurrent households (69,825) compared with Cable TV's current subscribership (21,750) makes Cable TV's  xpenetration rate 31.15 percent. The Board thus maintains that Cable TV is not subject to low penetration effective competition in the franchise area.  Sx- ` x8.` ` Cable TV replies that the evidence submitted in its petition demonstrates the presence of  SP- xlow penetration effective competition. Cable TV nonetheless provides additional information regarding  xits audit in order to further demonstrate that the Board's exclusive reliance on Census data is unjustified  xin this case. Cable TV states that, between 1989 and 1992, it completed several expansions of its cable  xsystem and that it retained detailed engineering maps from the original construction project and subsequent  S- xexpansions.3 ] yO\%-ԍReply at 3.3 Cable TV further states that Cable TV developed a single, comprehensive street map",`(`(88"  S- xkdetailing all existing cable plant and homes passed in the franchise area.?] {Oh-ԍId. at Exhibit 2.? Cable TV then states that it  xdispatched threemember crews to conduct a housebyhouse count of every home in the franchise area.  x[Cable TV asserts that the crews inspected all utility poles, taps and drops and was able to determine the  xnumber of: (1) homes currently receiving cable service; (2) homes that had received service at a prior  S`- xtime; (3) homes that were never wired for cable; (4) vacant homes; and (5) homes under construction.7`Z] {OZ-ԍId. at 3.7  xCable TV states that the results of the audit indicated that the franchise area contained 38,161 wired  x=homes, 34,325 never wired homes, 1,067 vacant homes, and 3,070 homes under construction. Cable TV  xexplains that it also counted 3,898 businesses which it considers to be occupied homes because most of  xthe businesses are operated from the ground level of a twolevel family dwelling. Cable TV further  xexplains that most of the homes it observed to be under construction at the time of its audit are now  xLcompleted and occupied. Cable TV combined the number of homes recorded in its audit figures with the  x289 new homes which the cable system now passes to arrive at a total of 83,291 homes in the franchise  S - xLarea.7 ] {O-ԍId. at 4.7 The total number of homes (83,291) compared with Cable TV's current subscribership results in a penetration rate of 26.1 percent.  S - ` x9.` ` Cable TV maintains that if the number of businesses, vacant homes, and homes under  xconstruction are factored out, the total number of homes in the franchise would be 75,356. Using this  xreduced figure, Cable TV calculates its penetration rate to be 28.9 percent and still below the 30 percent  xhousehold ceiling established by the low penetration test. Cable TV maintains that it has provided  xalternative data which provide a better indication of the number of current households in the franchise area than the outdated Census data upon which the Board relies.  S- IV.xDISCUSSION  S@- ` x10.` ` We grant Cable TV's petition to reconsider the certification of the Board to regulate basic  xcable service rates in the franchise area. Cable TV and the Board have each submitted data more current  x[than the 1990 Census data in an attempt to show the total number of current households in the franchise  xarea. The Board also calculated the number of households in the franchise area using 1990 Census data.  xWe have stated that "where both the cable operator and the franchising authority submit household  xnumbers more current than the most recent available Census data, it is incumbent upon the cable operator  xto demonstrate that its more current household numbers are more accurate and reliable than the household  S(-numbers submitted by the franchising authority."b(~] {OF!-ԍTCI Cablevision, Inc., 10 FCC Rcd 2925, 2927 (1995).b  S- ` x11.` ` We find that Cable TV's determination of current subscribers based upon its audit of  x\households in the franchise area is an acceptable and reliable method of determining a cable operator's",`(`(88"  S- xjpenetration rate.$] {Oh- x,ԍSee Upper Peninsula Communications, Inc., 11 FCC Rcd 2970 (1996), see also Implementation of Sections of  {O2- xthe Cable Television Consumer Protection and Competition Act of 1992, Third Order on Reconsideration, 9 FCC  xRcd 4316, 4324 (we presume that Congress did not intend "households" to have a different meaning than in the 1990 Census). Updated data can more closely determine actual penetration rates. Cable TV updated  xhousehold data by conducting a housebyhouse audit which it undertook during the period October, 1992  xthrough November, 1993. Initially, Cable TV included in its household count 38,161 wired homes, 34,325  xknever wired homes, 1,067 vacant homes, 3,070 homes under construction, 289 new homes, and 3,898  xLbusinesses which Cable TV considered to be homes to arrive at a total number of current households. In  x0its reply, Cable TV stated that even if the number of businesses, vacant homes, and homes under  xconstruction are factored out, the total number of homes in the franchise would be 75,356 for a penetration  x=rate of 28.9 percent. Thus we are persuaded that the current household data submitted by Cable TV are more accurate and reliable than the alternative data submitted by the Board.  Sp- ` x12.` ` The Board updated household data by using 1996 Census population estimates which it  xkthen divided by the average number of persons per household in each cable community to arrive at an  xestimate of the number of current households in the franchise area. After calculating the resulting 1996  xhousehold estimate, the Board calculated Cable TV's penetration rate to be 31.15 percent. Thus under  x.the Board's calculation Cable TV's penetration rate exceeds the 30 percent ceiling established by the low  xpenetration effective competition test. We find however that an actual count is a more accurate and  x.reliable method than the Board's reliance on Census estimates. Accordingly, we conclude that Cable TV is subject to low penetration effective competition in the franchise area at issue.  S- V.xORDERING CLAUSES  S- ` x13.` ` Accordingly, IT IS ORDERED that the petition filed by Cable TV Del Noroeste for  x.reconsideration of the certification of the Puerto Rico Telecommunications Regulatory Board to regulate  xbasic cable rates with regard to the communities of Aguada, Aguadilla, Isabela, Moca, and Quebradillas  S@- IS GRANTED .  S- ` x14.` ` This action is taken pursuant to delegated authority under Section 0.321 of the Commission's rules, 47 C.F.R. 0.321. x` `  hh@ x` `  hh@FEDERAL COMMUNICATIONS COMMISSION  S-x` `  hh@John E. Loganpp  xx 0(#(#Xx` `  hh@Acting Chief, Cable Services Bureau