CHAPTER 119
Cable Television Rate Regulations
Section
119.02 Review of increase request
119.03 Cable operator information
119.04 Automatic rate adjustments
119.01 DEFINITIONS.
For the purpose of this chapter, the following definitions shall apply unless the context clearly indicates or requires a different meaning.
BASIC CABLE RATES. The monthly charges for a subscription to the basic service tier and the associated equipment.
BASIC SERVICE TIER. A separately available service tier to which subscription is required for access to any other tier of service, including as a minimum, but not limited to all must-carry signals, all PEG channels and all domestic television signals other than superstations.
BENCHMARK. A per channel rate of charge for cable service and associated equipment which the FCC has determined is reasonable.
CABLE ACT OF 1992. The Cable Television Consumer Protection and Competition Act of 1992.
CABLE OPERATOR. Any person or group of persons:
(1) Who provides cable service over a cable system and directly or through one or more affiliates owns a significant interest in a cable system; or
(2) Who otherwise controls or is responsible for, through any arrangement, the management and operation of a cable system.
CHANNEL. A unit of cable service identified and selected by a CHANNEL number or similar designation.
COST OF SERVICE SHOWING. A filing in which the cable operator attempts to show that the benchmark rate or the price cap is not sufficient to allow the cable operator to fully recover the costs of providing the basic service tier and to continue to attract capital.
FCC. The Federal Communications Commission.
INITIAL BASIC CABLE RATES. The rates that the cable operator is charging for the basic service tier, including charges for associated equipment, at the time the city notifies the cable operator of the city’s qualification and intent to regulate basic cable rates.
MUST-CARRY SIGNAL. The signal of any local broadcast station (except superstations) which is required to be carried on the basic service tier.
PEG CHANNEL. The channel capacity designated for public, educational or governmental use, and facilities and for the use of that channel capacity.
PRICE CAP. The ceiling set by the FCC on future increases in basic cable rates regulated by the city, based on a formula using the GNP fixed weight price index, reflecting general increases in the cost of doing business and changes in overall inflation.
REASONABLE RATE STANDARD. A per channel rate that is at, or below, the benchmark or price cap level.
SUPERSTATION. Any non-local broadcast signal secondarily transmitted by satellite.
(‘87 Code, § 7-14-1) (Ord. 94-008)
119.02 REVIEW OF INCREASE REQUEST.
(A) Notice. A cable operator in the city who wishes to increase the rates for the basic service tier or associated equipment shall file a request with the city and notify all subscribers at least 30 days before the cable operator desires the increase to take effect. This notice may not be given more often than annually and not until at least one year after the determination of the initial basic cable rates.
(B) Expedited determination; public hearing.
(1) If the governing body is able to expeditiously determine that the cable operator’s rate increase request for basic cable service is within the FCC’s reasonable rate standard, as determined by the applicable price cap, the governing body shall:
(a) Hold a public hearing at which interested persons may express their views; and
(b) Act to approve the rate increase within 30 days from the date the cable operator filed its request with the city.
(2) If the governing body takes no action within 30 days from the date the cable operator filed its request with the city, the proposed rates will go into effect.
(C) Extended review period.
(1) If the governing body is unable to determine whether the rate increase is within the FCC’s reasonable rate standard based on the material before it, or if the cable operator submits a cost-of-service showing, the governing body shall, by adoption of a formal resolution, invoke the following additional periods of time, as applicable, to make a final determination:
(a) Ninety days, if the governing body needs more time to ensure that the requested increase is within the FCC’s reasonable rate standard as determined by the applicable price cap; and
(b) One hundred-fifty days, if the cable operator has submitted a cost-of-service showing seeking to justify a rate increase above the applicable price cap.
(2) The proposed rate increase is tolled during the extended review period.
(3) If the governing body has not made a decision within the 90- or 150-day period, the governing body shall issue a brief written order at the end of the period requesting the cable operator to keep accurate account of all amounts received by reason of the proposed rate increase and on whose behalf the amounts are paid.
(D) Public hearing. During the extended review period and before taking action on the requested rate increase, the governing body shall hold at least one public hearing at which interested persons may express their views and record objections.
(E) Objections. An interested person who wishes to make an objection to the proposed rate increase may request the City Clerk to record the objection during the public hearing or may submit the objection in writing anytime before the decision resolution is adopted. In order for an objection to be made part of the record, the objector must provide the City Clerk with the objector’s name and address.
(F) Delayed determination. If the governing body is unable to make a final determination concerning a requested rate increase, within the extended time period, the cable operator may put the increase into effect, subject to subsequent refund if the governing body later issues a decision disapproving any portion of the increase.
(G) Price cap analysis. If a cable operator presents its request for a rate increase as being in compliance with the FCC’s price cap, the governing body shall review the rate using the price cap analysis in accordance with the standard form authorized by the FCC. Based on the governing body’s findings, the basic cable rates shall be established as follows:
(1) If the proposed basic cable rate increase is within the price cap established by the FCC, the proposed rates shall become the new basic cable rates.
(2) If the proposed basic cable rate increase exceeds the price cap established by the FCC, the governing body shall disapprove the proposed rate increase and order an increase that is in compliance with the price cap.
(H) Cost-of-service showings.
(1) If a cable operator submits a cost-of-service showing in an attempt to justify a rate increase above the price cap, the governing body will review the submission pursuant the FCC standards for cost-of-service review.
(2) The governing body may approve a rate increase above the price cap if the cable operator makes the necessary showing; however, a cost-of-service determination resulting in a rate below the price cap or below the cable operator’s then current rate will prescribe the cable operator’s new rate.
(I) Decision.
(1) The governing body’s decision concerning the requested rate increase, shall be adopted by formal resolution.
(2) If a rate increase proposed by a cable operator is disapproved in whole or in part, or if objections were made by other parties to the proposed rate increase, the resolution must state the reasons for the decision.
(3) Objections may be made at the public hearing by a person requesting the City Clerk to record the objection or may be submitted in writing at anytime before the decision resolution is adopted.
(J) Refunds.
(1) The governing body may order refunds of subscribers’ rate payments with interest if:
(a) The governing body was unable to make a decision within the extended time period as described in division (C) above;
(b) The cable operator implemented the rate increase at the end of the extended review period; and
(c) The governing body determines that the rate increase as submitted exceeds the applicable price cap or that the cable operator failed to justify the rate increase by a cost-of-service showing and the governing body disapproves any portion of the rate increase.
(2) The method for paying any refund and the interest rate will be in accordance with FCC regulations as directed in the governing body’s decision resolution.
(K) Appeal. The governing body’s decision concerning rates for the basic service tier or associated equipment, may be appealed to the FCC in accordance with applicable federal regulations.
(‘87 Code, § 7-14-3) (Ord. 94-008)
119.03 CABLE OPERATOR INFORMATION.
(A) Requirements.
(1) In those cases when the cable operator has submitted initial rates or proposed an increase that exceeds the reasonable rate standard, the governing body may require the cable operator to produce information in addition to that submitted, including proprietary information, if needed to make a rate determination. In these cases, a cable operator may request the information be kept confidential in accordance with this section.
(2) In cases where initial or proposed rates comply with the reasonable rate standard, the governing body may request additional information only in order to document that the cable operator’s rates are in accord with the standard.
(B) Request for confidentiality.
(1) A cable operator submitting information to the governing body may request in writing that the information not be made routinely available for public inspection. A copy of the request shall be attached to and cover all of the information and all copies of the information to which it applies.
(2) If feasible, the information to which the request applies shall be physically separated from any information to which the request does not apply. If this is not feasible, the portion of the information to which the request applies shall be identified.
(3) Each request shall contain a statement of the reasons for withholding inspection and a statement of the facts upon which those reasons are based.
(4) Casual requests, which do not comply with the requirements of this section, shall not be considered.
(C) Governing body action.
(1) Requests which comply with the requirements of division (B) above, will be acted upon by the governing body. The governing body will grant the request if the cable operator presents by a preponderance of the evidence a case for nondisclosure consistent with applicable federal regulations. If the request is granted, the ruling will be placed in a public file in lieu of the information withheld from public inspection.
(2) If the request does not present a case for nondisclosure and the governing body denies the request, the governing body shall take one of the following actions:
(a) If the information has been submitted voluntarily without any direction from the city, the cable operator may request that the city return the information without considering it.
(b) Ordinarily, the city will comply with this request. Only in the unusual instance that the public interest so requires will the information be made available for public inspection.
(c) If the information was required to be submitted by the governing body, the information will be made available for public inspection.
(D) Appeal. If the governing body denies the request for confidentiality, the cable operator may seek review of that decision from the FCC within five working days of the governing body’s decision and the release of the information will be stayed pending review.
(‘87 Code, § 7-14-4) (Ord. 94-008)
119.04 AUTOMATIC RATE ADJUSTMENTS.
(A) Annual inflation adjustment. In accordance with FCC regulations, the cable operator may adjust its capped base per channel rate for the basic service tier annually by the final GNP-PI index.
(B) Other external costs.
(1) The FCC regulations also allow the cable operator to increase its rate for the basic service tier automatically to reflect certain external cost factors to the extent that the increase in cost of those factors exceeds the GNP-PI. These factors include retransmission consent fees, programming costs, state and local taxes applicable to the provision of cable television service, and costs of franchise requirements. The total cost of an increase in a franchise fee may be automatically added to the base per channel rate, without regard to its relation to the GNP-PI.
(2) For all categories of external costs other than retransmission consent and franchise fees, the starting date for measuring changes in external costs for which the basic service per channel rate may be adjusted will be the date on which the basic service tier becomes subject to regulation or February 28, 1994, whichever occurs first. The permitted per channel charge may not be adjusted for costs of retransmission consent fees or changes in those fees incurred before October 6, 1994.
(C) Notification and review. The cable operator shall notify the city at least 30 days in advance of a rate increase based on automatic adjustment items. The city shall review the increase to determine whether the item or items qualify as automatic adjustments. If the city makes no objection within 30 days of receiving notice of the increase, the increase may go into effect.
(‘87 Code, § 7-14-5) (Ord. 94-008)
119.05 ENFORCEMENT.
(A) Refunds. The city may order the cable operator to refund to subscribers a portion of previously paid rates under the following circumstances:
(1) A portion of the previously paid rates have been determined to be in excess of the permitted tier charge or above the actual cost of equipment; or
(2) The cable operator has failed to comply with a valid rate order issued by the city.
(B) Fines. If the cable operator fails to comply with a rate decision or refund order, the cable operator shall be subject to a fine of $500 for each day the cable operator fails to comply.
(‘87 Code, § 7-14-6) (Ord. 94-008)