HomeMy WebLinkAbout1993_10_20_Local_Law_No_10 1
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TlX',AI, LAW NO. 10-1993
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j A IAML LAW OF THE TOWN OF MUMNBCK
FSTABLZSHING- PROCEDURES AND STAMARDS
FOR THE REC=TION OF RATES FOR BASIC
CABLE SERVICE AND EQLIMM.
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PURPOSE
The Cable Television Consumer Protection and
Competition Act of 1992 authorizes franchising
authorities to regulate certain rates for cable
television service and equipment. The Town of
Mamaroneck desires to regulate cable rates except to
the extent that it is prohibited from doing so by
applicable law. FCC regulations implementing the
Cable Television Consumer Protection and Competition
Act of 7.992 require franchising authorities to adopt
regulations before rate regulation of basic service
and equipment can begin.
4Y SCOPE AM APPLICABILITY:
0.1 This U>cal Lawn governs the regulation rof rates for
basic service and -equipment within the Town of Matmaroneck for any
franchisee which as been notified that (a) the Town has been certified
�regulate its basic service anal equipment rates;. and (b) the Town has
ted regulations governing regulation of basic service and equipment
.�rates. in addition, the Town of Mamaroneck may regulate the rates for
.cable services and equipment to the extent not prohibited by law,
pursuant to such resolutions, ordinances or regulations as it may
ereafter adopt. The provisions set forth below are intended to be
consistent with all Federal Communications Commission (FM) regulations
governing the regulation of basic service rates :and equipment and the
tand all those acting on its behalf will regulate and int=erpret its
es so that they are consistent with FCC regulations, as if those
regulations were set forth in full herein; the franchisee is prohibited
from engaging in any activity it is prohibited in engaging in-under FCC
(es, as if those rules were set forth in full herein. For purposes
these provisions, the term 1rbasic servic,01 or Epic cable serviced
the same meaning as the term Jqasic services' at 47 C.F.R. 76.901
and the term "equipment" refers °to all. equipment and services subject
to -regulation under 47 C.F.R. 76.923.
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SECTION l: FILING AND REVIEW OF RATES:
1.1. Initial Filings By--Franchisees.
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1.1,1 Filings: When Made. A franchisee that is notified
that its basic service and equipment rates are subject to regulation
must file a submission (f3the rate filing") within 30 days of the
notification (but no earlier than November 15, 1993) , justifying its
Yasic service and equipment agates. All basic service and equipment
rates for all customer classifications must be justified. Once a
franchisee has been- so notified by the Town that its rates are subject
to regulation, it may not thereafter increase its rates for basic
service or equipment without the prior approval of the Tovm. This
arequirement applies in -all cases, including with respect to increases
in rates announced prior to the date the operator was notified its
ar~ates were subject to regulation where the increases were not
, demented prior to the date of notice. A franchisee mast submit a
rate filing to justify any increase in basic service,or equipment rates
or any new basic service or equipment rate (collectively referred to
` herein as rate increases) . An fsincrease" occurs, without limitation,
when there is an increase in rates or a decrease in programming or
F_ customer services. Mate filings proposing and supporting rate
or must be filed for review at least 30 days in advance of the
proposed effective date of the increase. This requirement does not
ter or eliminate any other notice requirement.
1.1.2 'Filing: Where Made. Every rate filing must be
submitted to the Larcbmont-Mamaroneck Cable Tv Board of Control (.the
J+Board") . A rate filing shad be considered filed for review on the
elate the required -rate filing and all required copies are received by
the Hoard. Five copies of each rate filing (including all supporting
materials) mast be submitted. -If the operator claims any part of the
Filing is proprietary, it shall additionally file five copies, which
it the proprietary information.
1.1.3 Filing: Contents. subject to .FCC regulations
govertu.ng the burden of proof, a rate filing submitted by a franchisee
gust show- that the rates the franchisee proposes to charge for basic
service and equipment are reasonable. Except as inconsistent with FM
rules:
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1.1.3.1 Every rate filing must clearly state in a covering
letter whether it justifies existing rates, or -proposes an increase in
rates. The covering letter must also identify any rate that is derived
in whole or in part based upon cost of service, and identify any pages
of the rate filing that contain information that the franchisee claims
is proprietary. It must state whether any part of the proposed
increase is based on an inflation adjustment or an alleged increase in
external, costs. The cover letter should also
contain a brief, native description of any proposed changes in rates
or in service.
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1.1.3.2 The pages of each rate filing must be numbered
equential.ly.
1.1.3.3. The rate filing must contain all applicable rcr-
foams and these forms must be correctly completed.
1.1.3.4 If different rates are proposed for basic service
or different` classes of customers, the filing must show that the
classifications and the differences in the rate charged are reasonable
and oonsistent with federal law.
1.1.4 If the franchisee seeks to support a rate based upon a
oust of service, the Town will establish a rate that provides the
�franehisee an opportunity to recover the reasonable costs associated
�With providing basic cable service, including a reasonable profit. An
�Pn or investment is not presumed reasonable merely because the
franchisee has incurred or madeit. A franchisee is not entitled to
recover monopoly profits in any form.
1.1.5 Franchisee In addition to information the Town or
Roard .requires the franchisee to provide, and unless the Town grants a
waiver of this provision, a franchisee who seeks to justify all or any
part of its rates based upon its cost of service must submit a complete
cost of• service analysis that shows all expenses it incurs and all
revenues derived from the -system, directly ,or indirectly by the
franchisee or any person that constitutes a cable operator of the
system within the meaning of 47 U.S.C. 522(5). The cost of service
must identify the accounting level (as that term is used in the FCCOs
regulations) at which each expense or revenue identified was aggregated
and show clearly how the expense or revenue was allocated. The
franchisee may not include costs at an accounting level unless it also
includes all
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revenues frcm that same level attributable to the system or to a group
of systems of which the system service the Town is a part. The
replacement cost of a comparable system must be identified and
supported. The franchisee must identify the name and address of any
entity with which it has a contract, other than a programmer, which
derives revenues from the system, and must state whether and how the
revenues of that entity were included in the cost of service. In
addition, the cost of service shall clearly show the derivation of a
proposed charge per channel and the application of that charge to yield
a basic service rate. It must also show and support the derivation and
allocation of any amounts included in the derivation of the rate for:
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1.1.5.1 operation and maintenance expenses;
1.1.5.2 administrative and general expenses;
1.1.5.3 programming expenses (identifying retransmission
consent costs and copyright fees separately) ;
1.1.5.4 costs for PEG access and any institutional network;
2.1.5.5 franchise fee expenses;
1.1.5.6 investment in the system and associated
depreciation;
1.1.5.7 other expenses, including federal, state and local,
taxes, itemized;
1.1.5.8 the proposed return on equity and actual interest
expense paid by the franchisee.
1.1.6 Notwithstanding the foregoing, a franchisee is not
required to submit the cost of service specified in Section franchisee
for equipment rates, and instead initially shall complete, submit and
support the costs of equipmment using applicable FCC forms. Any costs
of equipment using applicable FCC forms. Any cost of service submitted
to justify basic service rates must show that the cost of service does
not include equipment costs.
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1.2. Initial Town Review
1.2.1 After receiving a rate filing, the Board promptly
shall publish a notice that a filing has been received and that, except
for those parts which may be withheld as proprietary, it is available
for public review. The notice shall state that interested parties may
c:amtent on the filing, and shall provide interested parties seven days
to submit written comments on the filing to the Board. The Hoard shall
submit the comments received and its recommendations for action to the
Tovm and shall make those recommendations and comments available for
public inspection. The franchisee may ssubrait a response to public
comments or Board recommendations, but must do so no later than three
business clays after the Board rec=nendations are submitted to the
Town. The response shall be filed with the Board, and if submitted in
a timely fashion, the Board shall forward a copy to the Town.
1.2.2 Within 30 days of the date of the filing, the Town
shall issue a written order, which may be in any lawful form, approving
the proposed rate in whole or in part; denying the proposed rate in
Thole or in part; or tolling-the proposed rate in whole or part. If
the Tdwn tolls the rate in whole or in part, its written order at a
� inimu m shall explain that it requires additional time to review the
rate filing and state that the franchisee may cure any deficiency in
its filing by submitting a supplementary filing as provided in Section
1.3. With respect to existing rates, tolling meads the rates
may remain in effect, :subject to refund; with respect to rate changes,
tolling means the portion of the rate change that is tolled may not go
into effect
1.3 Supplementary Filings
1.3.1 If a proposed rate is tolled in whole or in part, the
franchisee shall submit a supplementary filing 20 days from the
effective date of the tolling order, containing corrections, if any, to
is filing (including any supplement to its cost of service filing) and
zCU y response to information filed by interested parties or to the
�reeamnendations- of the Board, or any additional information necessary
to support the proposed rate. supplementary filings must be filed in
accordance With Section 1.1.2.
1.3.2 h supplementary filing also must contain such
infonnation as the Hoard or the• Town directs the franchisee to provide.
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1.4 in addition to information the Hoard or the Town request
the franchisee to provide, and unless the Board.or the Town grants a
waiver of this provision, a franchisee who claims that it is entitled
to a rate in whole or in part based upon the adjustments for inflation
and :external costs contemplated by 47 C.F.R. 76.922(d) (1)-(2) must
submit the following:
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1.4.0.1 a calculation showing how each part of the
adjustment was derived.
1.4.o.2 a statement itemizing each external cost (as defined
by'AM regulations), the amount of that external costs for the two
endar years prior to the date of the filing and the year-to-date in
4hich the filing is made, and the projected amount of the external cost
for the remainder of the year in which the filing is made and for the
following calendar year. The statement must specifically show any
increases in revenues from programming services. ++Revenues11 include
all revenues, in whatever form received.
1.4.0.3 if the increase is attributable to any increase in
programming service costs, the contract for each programming service
�Mose cost has increased; a sworn statement identifying each
xogranmixbq service whose costs increased where the programmer is an
1- kffiliate of the franchisee (as defined by FCC regulations) ; and, for
any contract that has been in effect less than 12 months, the print
contract for the service.
1.4.0.4 a sworn-statement by the franchisee's chief
financial officer or an independent, certified accountant stating that
e or she has examined all external costs (including all programing
costs). and has offset against any increase claimed, the amount of any
decreases in external costs, and the amount by which any increase in
external costs was below the GNP-PI, as required by 47 C.F.R.
�76.9221d) (2) ; affirming that the franchisee has only sought to recover
any external cost to the extent that cost exceeded the GNP-Pl; .and
affirming that the franchisee has not attempted to recover any increase
in the cost of programming purchased by an affiliate except as provided
in 47 C.F.R. 76.922(d) (2) (vi) .
1.4.1 Upon receiving the supplementary filing, the -Board
promptly shall publish a notice that a filing has bee received and that
it -is available for public review (except those parts -which may be
withheld as proprietary) . The notice shall state that interested
parties may comment on the filing, and shall provide interested parties
twenty days to submit written coments on the filing to the Board. he
Board shall submit the comments received and its re=mtendations for
action to the Town.
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1.4.2 The Board's recomendations- and the public ccimRents
shall be made available for public inspection. The franchisee may
submit a response to public comments or Board reeonm endations, but
must do so no later than ten days after the Board rec;onmendations are
submitted to the Town. The response shall be filed with the Board,
and if submitted in a timely fashion, the Board shall forward a copy
to the Town.
1 1.4.3 The Town shall issue a written- order, which may be
sn any lawful form, approving the proposed rate in whole or in part;
denying the proposed rate in whole or in part; or allowing the rate
.o go into effect in whole or in part, subject to refund. If the
Town issues an order allowing the rates to go into effect subject to
refund, it shall also. direct the franchisee to maintain an accounting
in accordance with 47 C.F.R. 76.933.
1.4.4 The order specified in Section 1.3.6. shall be
adopted within 90 days after the tolling order for any. rate the
franchisee justifies based -on the FCC benchmark. The order shall be
dopted within 150 days of the tolling order for any rate the
' franchisee justified with a cost of service showing.
SECTION 2: PROVISIONS GENERALLY Y APPLICABLE TO RATE ORDERS
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2.2 Any rate order of the Town shall be issued and
i effective upon adoption. Each rate order shall. be released to the
public and the franchisee. In any case where the Town approves,
denies, or tolls a rate; orders that a rate may go into effect
subject to refund; or orders refunds or establishes rates, a public
4otice shall be -published stating that the order has issued and is
available for review. Any such order shall be in writing.
2.2 The Board and the town may take any steps that they
are not prohibited from taking by federal law to protect the public
F interest as part of any rate order or by any other means. By way of
illustration and not limitation, the Town may require refunds, set
rates, and impose forfeitures and penalties directly or through its
delegated representatives, and enforce refund orders. Any order
prescribing a rate shall explain why the f'ranchiseels proposed rate
was unreasonable and why the prescribed rate. is- reasonable. However,
before prescribing a rate or ordering a .refund to subscribers, the
Ttnm shall ensue the franchisee has had notice and opportunity to
comment on the proposed rate or refunds. If the recc mendations of
the Board propose a refund; or a rate, then mailing a. copy of the
reommtendation to the franchisee at the time it is sutmitted to the
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' Town shall be deemed to provide the franchisee this notice and the
franchisee must =went on the refund or rate in its response to the
recommendation.
2,3 No order approving or setting a crate using the FCC
benchmarks shah, be interpreted to establish the just and reasonable
rate to subscribers. Every such rate approved or established shall
be subject to further reduction and refund to the extent permitted
under applicable laws and regulations, as the same may be amended
from time to time. By way of illustration and not limitation, should
the FM reduce the benchmarks, the Town shall have the right to
reduce a franchisews rates and to require the franchisee to refund
any amounts collected above the benchmark, except to the extent
prohibited by federal law.
SECTION 3: FRANCHISEE, DUTIES
3.1 A :franchisee must ,imple ent remedial requirements,
goluding prospective rate reductions and refunds, within 60 days of
the date the Tom issue an order mandating a remedy,
�. i 3.2 Within 90 days of the date an order mandating a remedy
is issued, a franchisee must file a certification, signed by an
authorized representative of the cable company stating:
3.2.1 whether the franchisee has compiled fully with all
3rovisions of the Town order; and
3.2.2 describing. in detail the precise measures taken to
lenient the Town order; and
3.2.3 showing how refunds (including interest) were
calculated and distributed.
3.3 It is each franchisees responsibility to keep books
and records of account so that it can refund any amounts owed to
cribers.
3.4 It is each franchisee's duty to submit -as complete a
cling as possible, and knowingly withholding information or making a
iling that is incomplete under applicable law shall be treated as an
evasion of this resolution.
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3.5 Information Requests.
3.5.1 A franchisee and any other entity that has records
of revenues or expenses that are allocated to the €ranchisee►s system
#ust respond to requests fro information from the Board of Town by
deadlines established by the Board. A franchisee is responsible for
ensuring that such other entity responds to the requests.
3.5.2 Because federal law limits the time available for an
initial response to a filing by a franchisee before the order
contemplated by -section 1.2 issues, the franchisee must be prepared
do respond to requests for information regarding its filing within
five days of the date an information request is mailed to it. The
information may include the information the franchisee would be
required to provide as part of any supplementary filing.
E)C.'].'IONS 4: DUTIES OF BOARD
4.1 The Board shall be responsible for administering the
rovisions herein. Without limitation and by way of illustration.
4.1.1 The Board shall ensure notices are given to the
lie and each franchisee as required herein and by FCC regulations.
4.1.2 The Board may submit requests for information to the
franchisee and establish deadlines for response to then, as provided
in Section 3.
4.1.3. For good cause, the Board may waive any provision
herein or extend any deadline for filing or response except as to
such matters that are mandatory under FCC regulations.
4.1.4. The Board sha l rule on any request for
nfidentiality.
4.1.5. The Board shall prepare the recommendations mtendati.ons to the
;rncontemplated by Sections 1.2-1.3. If the Board reconnends, that
increase be denied in whole or in part, it shall
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4.1.5.1. propose a rate and explain the basis for its
recommendation (it may propose that rates remain at existing lecrsls) ,
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4.1.5.2. recommend whether and on what basis refunds
should issue; and
j 4.1.5.3. notify the franchisee of its recommendation at
the time it is submitted to the Town.
gEOMON 5: PENALTIES AND FORFEITURES
, I Except as prohibited by Federal Law, a franchisee shall be
subject to penalties and forfeitures under Executive Law and its
xegaest for approval of a rate may be denied if it:
5.1 knowingly submits false or fraudulent information to
the Board of the Town in connection with any rate proceeding,;
5.2 fails to comply with any lawful, order or request of
the Board or the Town including, but not limited to a request for
information or an order setting rates; or
5.3 evades or attempts to evade federal or local rate
regulation; provided that, filing for approval of a rate that is
later determined to be unreasonable is not in .and of itself an
evasion of federal or local rate regulation.
ON 6. PROPRILMRY IM04AT'ION
6.1 If' these provisions or any request for information
ryes the production or proprietary information, the franchisee
produce the information. However, at the time the allegedly
proprietary information is sutmitted, a franchisee may request that
�pecific, identified portions of its response be 'treated as
confidential and withheld from public disclosure. The request must
State the reason why the information should be treated as proprietary
and the facts that support those reasons. The request for
confidentiality will be granted if the Board determines that the
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preponderance of the e=vidence shows that nondisclosure is consistent
with the provisions of the Freedom of Information Act, 5 U.S.C.
552. If the Board decides that information can be withheld, it will
issue a written decision explaining the basis for withholding the
information, and place that decision in a public file for
.inspection. If the franchisee requests confidentiality and• the
request is denied, (1) where the franchisee is proposing a rate
increase, it may withdraw the proposal, in which case the allegedly
proprietary information will be returned to it: or (2) the Franchisee
may seek review within five working days of the denial in any
appropriate forum. Release of the information will be stayed pending
review.
6.2 Any interested party may file a request to inspect
terial withheld as proprietary with the Board. The Board shall
weight the policy considerations favoring nondisclosure against the
reasons cited for permitting inspection in light of the facts of the
particular case. It will then, promptly notify the requesting entity
and the cable franchisee that submitted the information as to the
disposition of the request. It may grant, deny or condition a
est. The requesting party or the franchisee may seek review of
the decision by filing an appeal with any appropriate forum.
Uiselosure will be stayed pending resolution of any appeal.
SECTION 7: PETITION FOR CHUM IN STATUS
7.1 Any franchisee may petition for a change in status in
accordance with 47 C.F.R. 76.915, and the Town shall consider that
petition in accordance with 47 C.F.R. 76.915. The petition"and
ive copies must be filed with the Board.
S"MON 8 SWOMMILITY
Should any provision of this Local Law be declared illegal
or unconstitutional by a court of competent jurisdiction, such
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eclaration shall not effect any ether provision of this Kcal Law
Which can nevertheless be implemented.
SECTION 9: EFFECTIVE DATE
This Local Law shall take effect immediately upon filing
with the Secretary of State.
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