ITEM 6-E
City Council Mtg.-Nov. 29, 1994
TO: Mayor and City Council
FROM: City Staff
SUBJECT: Recommendation to Approve a Resolution Issuing an
Accounting Order Regarding Basic Services Rates and
Associated Charges of Century Southwest Cable
Television, Inc.
INTRODUCTION
This report recommends that the City Council issue, by
resolution, an "accounting order" to Century Southwest Cable
Television, Inc. ("Century") which will provide additional time
for City staff to review supplemental information recently
submitted by Century in support of its charges for cable
television services for the period from July 15, 1994 to the
present.
BACKGROUND
The City has been certified by the Federal Communications
Commission (FCC) to regulate basic cable television rates (which
includes the "basic cable" tier and rates for associated
equipment, installation and service) consistent with FCC
regulations. Pursuant to these regulations, a cable company must
justify the rates it charges as reasonable in accordance with
federally-devised formulas. The City serves as the implementing
agency for determining compliance with federal regulations.
The FCC has divided the rate regulation analysis and decision-
making process into several time periods. The City Council
adopted a rate order on July 19, 1994 which a) established
Century's permitted rates for the basic cable service tier and
associated equipment, installation and services for the period
from September 1, 1993 to July 14, 1994; and b) ordered refunds
for overcharges for the basic service tier and for certain
installation rates during that period. Century appealed the
City's rate order and the matter is now pending before the FCC.
Presently, the City is reviewing rate information from Century
for the period beginning July 15, 1994 (FCC Form 1200 and
associated forms). Depending on the outcome of this analysis,
Century Cable customers may also be entitled to refunds for some
portion of charges made since July 15, 1994, in addition to the
refunds previously ordered.
The FCC has set forth specific procedures for franchising
authorities and cable companies to follow in this FCC Form 1200
Series review process. The City and Century have been proceeding
in accordance with these requirements over the past few months.
The City received Century's FCC Form 1200 on August 12, 1994. The
information contained in it was not sufficient for the City to
make a rate determination. On September 7, 1994 the City
extended the period during which the City could review the
information provided by Century to December 10, 1994 due to the
need for Century to provide additional information.
On October 11, 1994 the City sent Century a Supplemental
Information Request and received information from Century on
October 26, 1994. The City needs additional time to review
Century's response and may need additional information from
Century before making a rate decision concerning the
reasonableness of Century's rates for the period.
Because essential information was received on October 26, 1994
and must be analyzed, City staff believes that it is prudent to
officially extend the City's review period beyond December 10,
1994 and yet preserve its right to make a rate determination and
order refunds that can be retroactively applied back to July 15,
1994. In order to accomplish this extension, it is necessary to
issue this accounting order.
BUDGET IMPACT
There is no City budgetary impact resulting from the issuance of
this accounting order.
RECOMMENDATION
City Staff recommends that City Council adopt the attached
resolution issuing an accounting order to allow further time for
the City to reach a rate decision regarding the reasonableness of
the basic services rates and associated charges of Century
Southwest Cable Television, Inc. for the period commencing July
15, 1994.
Prepared by: Lynne C. Barrette
Assistant City Manager
Kate Vernez
Senior Management Analyst
Linda A. Mills-Coyne
Deputy City Attorney
Attachment: Resolution
RESOLUTION NO.________
(City Council)
A RESOLUTION OF THE CITY COUNCIL OF
THE CITY OF SANTA MONICA
ADOPTING AN ACCOUNTING ORDER REGARDING
BASIC SERVICES RATES AND ASSOCIATED CHARGES
OF CENTURY SOUTHWEST CABLE TELEVISION, INC.
FOR THE PERIOD COMMENCING JULY 15, 1994
WHEREAS, the City of Santa Monica (the "City") became
certified to regulate basic cable service rates and associated
charges as of October 7, 1993, and has followed regulations
prescribed by the Federal Communications Commission ("FCC") for
the regulation of the basic service tier and associated charges
(the "FCC Rules"); and
WHEREAS, the City has not yet completed its review of
the FCC Forms 1200, 1205, 1210 and 1215 submitted by Century
Southwest Cable Television, Inc. (the "Company") and reached a
decision regarding the reasonableness of the rates for basic
service and associated equipment, installation and service
charged by the Company; and
WHEREAS, the City is not yet in a position to issue a
rate decision at this time since the City needs additional time
to review the supplemental information submitted by the Company
in support of its FCC Forms;
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA
MONICA DOES RESOLVE AND ORDER AS FOLLOWS:
SECTION 1. Pursuant to 47 C.F.R. Section 76.933(c) of
the FCC Rules, the Company is hereby directed, from the date of
this Order until the date the Company implements any rate
decision issued by the City, to keep an accurate account of all
amounts received, and on whose behalf such amounts were paid, for
basic service and associated equipment, installation and service.
SECTION 2. The Company may not increase its rates for
basic cable service, and for associated equipment and
installation, nor may it institute new charges for other types of
service, equipment or installation associated with the basic
service tier, without first complying with the FCC Rules,
including any modifications or amendments to the FCC Rules.
SECTION 3. The City reserves all rights it has under
the FCC Rules, including the right to establish reasonable rates
and order rate refunds, if the City finds that the Company's
rates are unreasonable under the FCC Rules, including any
modifications or amendments to such regulations.
SECTION 4. The City Manager shall cause to be
delivered a copy of this Order to the Company prior to December
10, 1994.
SECTION 5. The City Clerk shall certify to the
adoption of this Resolution, and thenceforth and thereafter the
same shall be in full force and effect.
APPROVED AS TO FORM:
____________________
City Attorney