FOR FCC RECORD ONLY $//Prime Cable of Hickory, L.P., MO&O, DA95-168//$ $/76.922 Rates for Cable Programming Service tier/$ $/benchmark cable rates/$ Before the Federal Communications Commission Washington, D.C. DA 95-168 In the matter of ) ) Prime Cable of Hickory, L.P. ) CUID No. NC0175 Catawba County, North Carolina ) ) Benchmark Filing To Support ) Cable Programming Service Price ) Memorandum Opinion and Order Adopted: February 14, 1995 Released: February 15, 1995 By the Deputy Chief, Cable Services Bureau: Introduction 1. Here we consider a complaint about the price Prime Cable of Hickory, L. P. ("Prime Cable") was charging for its cable programming service ("CPS") tier in Catawba County, North Carolina, CUID No. NC0175. Prime Cable has attempted to justify its price through a benchmark showing on FCC Form 393. This order addresses the reasonableness of Prime Cable's price only through May 14, 1994. At a later time we will issue a separate order addressing the reasonableness of the price after that date. 2. Under the Cable Television Consumer Protection and Competition Act of 1992, and our rules implementing it, 47 C.F.R. Part 76, Subpart N, the Commission must review CPS prices 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 CPS prices. Under our rules, an operator may attempt to justify its prices through either a benchmark showing or a cost-of-service showing. In either case, the operator has the burden of demonstrating that its CPS prices are not unreasonable. 3. The Commission's original rate regulations took effect on September 1, 1993. The Commission subsequently revised its rate regulations effective May 15, 1994. Operators with valid CPS complaints filed against them prior to May 15, 1994 must demonstrate that their CPS prices were in compliance with the Commission's initial rules from the time the complaint was filed through May 14, 1994, and that their prices were in compliance with the revised rules from May 15, 1994 forward. Operators attempting to justify their prices for the period prior to May 15, 1994 through a benchmark showing must complete and file FCC Form 393. Generally, to justify their prices for the period beginning May 15, 1994 through a benchmark showing, operators must use the FCC Form 1200 series. Procedural Matters 4. The first valid CPS complaint was completed and served on Prime Cable on December 22, 1993. The Commission received the complaint on December 27, 1993. 5. Prime Cable attempted to justify its CPS price through an FCC Form 393 filed on January 21, 1994. Prime Cable amended its justification three times: on May 17, 1994; on June 27, 1994, in response to a Cable Services Bureau Order citing common deficiencies observed in benchmark filings generally; and on February 7, 1995, in response to a Cable Services Bureau Public Notice offering operators the opportunity to make optional supplemental filings. 6. As part of its January 21, 1994 filing, Prime Cable requested that the Commission dismiss the December 22, 1993 rate complaint. Prime Cable argues that the complaint should be dismissed because "the complainant did not describe the cable programming service nor provide a current rate for cable programming service." Prime Cable's assertion does not persuade us that the complaint is invalid or should be dismissed. In general, we will find valid any complaint that states a claim on which relief can be granted and provides adequate information to allow us to process the complaint, despite minor flaws or inaccuracies. We believe this approach best implements the mandate of the 1992 Cable Act. Because the rates listed in answer number 8 and on the attached bill indicate that the complainant received the CPS tier, we find it reasonable to conclude that the complainant objected to the CPS tier rate. We therefore find the complaint dated December 22, 1993 valid and deny Prime Cable's request to dismiss the complaint. Discussion 7. Prime Cable asserts that its monthly CPS tier price of $12.03 per subscriber is justified by its benchmark filing because its price is less than the maximum permitted charge of $12.08 as calculated in its most recent amended filing, dated February 7, 1995. Upon review, however, we have determined that Prime Cable has not correctly calculated its maximum permitted price, and it is therefore appropriate to make the following adjustment to Prime Cable's calculations in Form 393: a. In calculating its Inflation Adjustment Factor in Form 393, Part II, Worksheets 1 and 4, Prime Cable did not rely on the most currently available data released by the U.S. Department of Commerce. Rather than relying on data released by the U.S. Department of Commerce on December 1, 1993, Prime Cable relied on data released on August 31, 1993. We therefore must recalculate Prime Cable's Inflation Adjustment Factor using the most accurate data currently available for the date for which Prime Cable filed. On July 29, 1994, the U.S. Department of Commerce released corrected inflation data including Gross National Product Price Index ("GNP-PI") figures of 122.3 for the third quarter of 1992 and 126.5 for the fourth quarter of 1993. Using these GNP-PI figures, we calculate an Inflation Adjustment Factor through December 1993, the base date Prime Cable used in justifying its rates, of 1.034. 8. Because of this error, we conclude that Prime Cable has failed to demonstrate that its price for the CPS tier was not unreasonable. We will therefore set a price for this tier, incorporating the adjustment discussed above. This adjustment has the effect of reducing the maximum permitted monthly CPS tier price from $12.08 (as Prime Cable calculated in its February 7, 1995 filing) to $11.98. Conclusions 9. Upon review of the record herein, we conclude that Prime Cable's showing supports a maximum reasonable CPS tier price of $11.98 per month (plus franchise fee) for the period December 27, 1993 to May 14, 1994. However, we further determine that the refund at issue is such a de minimis amount that it would not serve the public interest to order a refund. 10. We further conclude that Prime Cable has submitted in good faith a timely optional supplemental filing in response to our December 29, 1994 Public Notice. As provide in the Public Notice, we will relieve Prime Cable of its obligation to obtain advance Commission approval of adjustments to its CPS price for one year following the release of this order. 11. Accordingly, IT IS ORDERED, pursuant to Section 0.321 of the Commission's Rules, 47 C.F.R.  0.321, that the request of Prime Cable of Hickory, L.P. to dismiss the December 22, 1993 complaint against its cable programming service price charged in Catawba County, North Carolina, CUID No. NC0175, IS DENIED. 12. IT IS FURTHER ORDERED, that the December 22, 1993 complaint against the cable programming service price charged by Prime Cable of Hickory, L.P. in Catawba County, North Carolina, CUID No. NC0175, IS GRANTED TO THE EXTENT INDICATED HEREIN AND DENIED TO THE EXTENT INDICATED HEREIN. 13. IT IS FURTHER ORDERED, that the benchmark filing submitted by Prime Cable of Hickory, L.P. with respect to Catawba County, North Carolina, CUID No. NC0175, for the period of December 27, 1993 to May 14, 1994, justifies a maximum price of $11.98 per month (plus franchise fee) for the cable programming service tier. 14. IT IS FURTHER ORDERED, pursuant to Section 76.960 of the Commission's rules, 47 C.F.R.  76.960, that Prime Cable of Hickory, L. P. shall not be required to obtain advance Commission approval of adjustments to its CPS price for one year following the release of this order. FEDERAL COMMUNICATIONS COMMISSION Gregory J. Vogt Deputy Chief, Cable Services Bureau