PUBLIC NOTICE FEDERAL COMMUNICATIONS COMMISSION 1919 M STREET, N.W. WASHINGTON, D.C. 20554 DA 96-1217 News media information 202/418-0500 Fax-On-Demand 202/418-2830 Internet: http://www.fcc.gov ftp.fcc.gov Report No. CS 96-26 CABLE SERVICES ACTION August 2, 1996 FOURTH QUARTER 1995 AND FIRST QUARTER 1996 INFLATION FIGURES FOR CABLE OPERATORS USING FCC FORM 1240 NOW AVAILABLE As described in the instructions for FCC Form 1240, cable operators may adjust the non-external cost portion of their rates for inflation based on quarterly inflation figures released by the Commission. The Fourth Quarter Inflation Figure for 1995 is 2.22%. This number is an annualized growth figure representing the inflation which occurred in the period from October 1, 1995 to December 31, 1995. The First Quarter Inflation Figure for 1996 is 2.39%. This number is an annualized growth figure representing the inflation which occurred in the period from January 1, 1996 to March 31, 1996. Fourth Quarter Inflation Figure for 1995 The Fourth Quarter Inflation Figure for 1995 is based on changes in the Gross National Product Price Index ("GNP-PI") as published by the Bureau of Economic Analysis of the United States Department of Commerce. The figure was calculated by taking the GNP-PI from the fourth quarter of 1995 (108.517) and dividing it by the GNP-PI for the third quarter of 1995 which was used in calculating the Third Quarter Inflation Figure for 1995 (107.922). The result of this calculation was then converted from a quarterly growth figure to an annual growth figure by raising it to the fourth power. Operators who are calculating the Inflation Factor for a True-Up Period which includes some portion of the fourth quarter of 1995 should enter this figure in the appropriate lines of Worksheet 1 of FCC Form 1240 as "0.0222". First Quarter Inflation Figure for 1996 The First Quarter Inflation Figure for 1996 is based on changes in the Gross National Product Price Index ("GNP-PI") as published by the Bureau of Economic Analysis of the United States Department of Commerce. The figure was calculated by taking the GNP-PI from the first quarter of 1996 (109.16) and dividing it by the GNP-PI for the fourth quarter of 1995 which was used in calculating the Fourth Quarter Inflation Figure for 1995 (108.517). The result of this calculation was then converted from a quarterly growth figure to an annual growth figure by raising it to the fourth power. Operators who are calculating the Inflation Factor for a True-Up Period which includes some portion of the first quarter of 1996 should enter this figure in the appropriate lines of Worksheet 1 of FCC Form 1240 as "0.0239". Operators for whom this is the most recently released inflation figure and, therefore, the figure they will use for calculating the Projected Period Inflation Segment should enter this number on Line C3 as "1.0239". To date, the Commission has released three quarterly inflation factors for use with FCC Form 1240. The following table contains a list of these factors. Year Quarter Dates Covered Inflation Factor 1995 Third Jul. 1, 1995 - Sep. 30, 1995 2.22% 1995 Fourth Oct. 1, 1995 - Dec. 31, 1995 2.22% 1996 First Jan. 1, 1996 - Mar. 31, 1996 2.39% The Commission releases a new quarterly inflation factor for operators using FCC Form 1240 four times each year. The inflation factor for a given quarter is usually released between three and four months after the end of that quarter, depending on the schedule of the Department of Commerce. The release of a new factor is always accompanied by a Public Notice. Once the Public Notice is released, the factor is posted on the Commission's Internet site at the following address: http://www.fcc.gov/Bureaus/Cable/WWW/csb.html. In addition, the factor will be posted on the Cable Bureau's automated telephone information system at: (202) 418-2225 [(202) 418-2226 for Spanish speakers]. Media contact: Morgan Broman (202) 418-2385; Cable Services Bureau Contact: Alex Byron at (202) 418-7200. --FCC--