HomeMy WebLinkAboutRate Order Time Warner CableSTATE OF NORTH CAROLINA
ORANGE COUNTY, NC-0256
BEFORE THE COUNTY BOARD
IN THE MATTER OF: )
The Review of FCC1240 Annual Rate )
Adjustment Request, FCC1235 )
Abbreviated Cost of Service Rate Request, )
and FCC1205 Equipment and Installation )
Rate Request filed by Time Warner )
Cable )
An Order Finding Time Warner Cable's 2002
FCC1240 Basic Service Tier and FCC1235 Cost of
Service Rates Reasonable and Subject to the
Conditions Stated Herein.
And Finding Time Warner Cable's FCC1205
Equipment and Installation Rates Unreasonable. and
Subject to the Conditions Stated Herein.
WHEREAS, in accordance with the provisions of the Cable Television Consumer Protection and
Competition Act of 1992 (1992 Act), the Federal Telecommunications Act of 1996 (1996 Act), the County Code,
and regulations adopted pursuant to that Code, the County Board is pernutted to regulate rates for basic cable
services and associated equipment;
WHEREAS, Time Warner Cable of Raleigh-Durham (Time Warner) submitted FCC 1240 Updating
Annual Maximum Permitted Rates filings for Regulated Cable Services with the County. Time Warner's filings
encompass external costs, inflation, and program costs for the True-up period of October 2000 through September
2001, and the projected period of January 2002 through December 2002;
WHEREAS, the County received a report from its Consultant stating that Time Warner submitted its
FCC1240 before the FCC published its October 2001 updated inflation factors; Time Warner's FCC1240 rate
calculations comply with the FCC's rate-making rules;
WHEREAS~ Time Warner submitted a consolidated "Company" FCC1205 Determining Regulated
Equipment and Installation Costs filing with the County to set the regulated rate for the Hourly Service Charge
Installation Services and Equipment rentai rates;
WHEREAS, the County received a report from its Consultant stating that Time Warner was not able to
justify assumptions underlying the Hourly Service Charge ($35.84);
WHEREAS, the Consultant determined that Time Warner's FCC1205 filing does not comply with FCC
rules §76.923 (c)(1) and FCC §76.923 (c)(3) requiring the company FCC1205 methodology to produce just and
reasonable rates;
WHEREAS, Time Warner voluntarily selected a$34.95 HSC rate for its subscribers and not the
consolidated "Company" $35.84 FCC1205 rate and neither rate is reasonable;
WHEREAS, FCC rule §76.933 grants local franchisee authorities an initial ninety (90) day review period,
measured from the date of receipt of said filing by the franchise authority, with which to review the cable operator's
FCC 1240 rate filing. If said ninety (90) day review period expires before the rates go into effect, the franchise
authority retains review and refund authority past the initial ninety (90) day review period as long as all inquiries
from the cable operator regarding said review are responded to in writing within fifteen (15) days of said inquire;
WHEREAS, on March 1, 2002 Time Warner appealed the Town of Smithfield's FCC 1205 HSC Rate
Order to the FCC and subsequently requested the County delay its Rate Order pending a ruling by the FCC on Time
Warner's appeal;
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WHEREAS, as of the date of this Rate Order, the FCC has not ruled on Time Warner's appeal of the
Town of Smithfield's Rate Order;
WHEREAS, the County received Time Warner's 2003 FCC1205 rate filing and cannot delay
implementation of its 2002 Rate Order pending a timely ruling by the FCC in the Smithfield matter; and
WHEREAS, the County is certified with the FCC to regulate basic service tier rates provided by Time
Warner in the County.
NOW THEREFORE THE COUNTY BOARD MAKES THE FOLLOWING FINDINGS:
THAT Time Warner's Combined Maximum Pernutted Rates for Basic Tier Service are reasonable;
THAT Time Warner's Combined Maximum Permitted Rates for Basic Tier Service are reasonable;
THAT Time Warner did not justify the reasonableness of its "Company" $35.84 HSC nor its selected
$34.95 HSC rate;
THAT Time Warner's selected $34.95 HSC Rate is unreasonable;
THAT Time Warner may charge a Basic Service Tier rate below the approved combined maximum
pernutted rate;
THAT Time Warner shall not implement its 2002 FCC1205 HSC rate nor its selected $34.95 HSC rate;
and
THAT Time Warner has substantiated the other adjustments to its cable service rates based on past and
estimated cost elements.
IT IS THEREFORE ORDERED:
THAT Time Warner's Combined Maximum Permitted Rate for Basic Tier Service is reasonable and that
Time Warner may charge a combined "selected" BST rate below the approved maximum pernutted rates, but not
above it;
THAT the maximum permitted Basic Service Tier rate for Time Warner subscribers for the projected
period shall not exceed $13.83 in ETJ nor $11.51 in County per month, subject to subsequent fmdings by the Board
to the contrary;
THAT Time Warner's HSC Rate for Equipment and Installation Service $35.84 is not reasonable and its
selected a$34.95 HSC is unreasonable and neither shall be come effective;
THAT Time Warner must keep a full and accurate account of all revenues and costs associated with the
aforementioned HSC rate adjustments and, upon a 30 day request, submit a refund plan to the County regarding the
distribution of customer refunds pursuant to any overcharges associated with the January 2002 FCC1205 HSC rate
implementation;
THAT this Order shall be effective immediately and an executed original copy provided to Time Warner
Cable and copies provided to the public.
ISSUED BY ORDER OF THE ORANGE COUNTY BOARD
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This the ~ day of ~ t.~{~~- 2002.
BY:
Chair
ATTEST.
Clerk
Deliver Report and Executed Order via Certified U.S. Mail to: Time Wamer Cable
Copy to: Action Audits, LLC.