Sec.  76.933   Franchising authority review of basic cable rates and equipment
costs.

   (a) After a cable operator has submitted for review its existing rates for
   the  basic  service tier and associated equipment costs, or a proposed
   increase in these rates (including increases in the baseline channel change
   that results from reductions in the number of channels in a tier) under the
   quarterly rate adjustment system pursuant to Section 76.922(d), the existing
   rates will remain in effect or the proposed rates will become effective
   after 30 days from the date of submission; Provided, however, that the
   franchising authority may toll this 30-day deadline for an additional time
   by issuing a brief written order as described in paragraph (b) within 30
   days of the rate submission explaining that it needs additional time to
   review the rates.

   (b) If the franchising authority is unable to determine, based upon the
   material submitted by the cable operator, that the existing, or proposed
   rates under the quarterly adjustment system pursuant to Section 76.922(d),
   are within the Commission's permitted basic service tier charge or actual
   cost of equipment as defined in  Sec.  Sec. 76.922 and 76.923, or if a cable operator
   has submitted a cost-of-service showing pursuant  Sec.  Sec. 76.937(c) and 76.924,
   seeking to justify a rate above the Commission's basic service tier charge
   as defined in  Sec.  Sec. 76.922 and 76.923, the franchising authority may toll the
   30-day deadline in paragraph (a) of this section to request and/or consider
   additional information or to consider the comments from interested parties
   as follows:

   (1)  For  an additional 90 days in cases not involving cost-of-service
   showings; or

   (2) For an additional 150 days in cases involving cost-of-service showings.

   (c) If a franchising authority has availed itself of the additional 90 or
   150 days permitted in paragraph (b) of this section, and has taken no action
   within these additional time periods, then the proposed rates will go into
   effect at the end of the 90 or 150 day periods, or existing rates will
   remain  in effect at such times, subject to refunds if the franchising
   authority subsequently issues a written decision disapproving any portion of
   such rates: Provided, however, That in order to order refunds, a franchising
   authority must have issued a brief written order to the cable operator by
   the end of the 90 or 150-day period permitted in paragraph (b) of this
   section directing the operator to keep an accurate account of all amounts
   received by reason of the rate in issue and on whose behalf such amounts
   were paid.

   (d) A franchising authority may request, pursuant to a petition for special
   relief  under   Sec. 76.7,  that  the Commission examine a cable operator's
   cost-of-service  showing,  submitted  to  the franchising authority as
   justification  of  basic  tier  rates,  within 30 days of receipt of a
   cost-of-service showing. In its petition, the franchising authority shall
   document its reasons for seeking Commission assistance. The franchising
   authority  shall  issue an order stating that it is seeking Commission
   assistance and serve a copy before the 30-day deadline on the cable operator
   submitting the cost showing. The cable operator shall deliver a copy of the
   cost showing, together with all relevant attachments, to the Commission
   within 15 days of receipt of the local authority's notice to seek Commission
   assistance. The Commission shall notify the local franchising authority and
   the cable operator of its ruling and of the basic tier rate, as established
   by the Commission. The rate shall take effect upon implementation by the
   franchising authority of such ruling and refund liability shall be governed
   thereon.  The  Commission's ruling shall be binding on the franchising
   authority and the cable operator. A cable operator or franchising authority
   may seek reconsideration of the ruling pursuant to  Sec. 1.106(a)(1) of this
   chapter or review by the Commission pursuant to  Sec. 1.115(a) of this chapter.

   (e) Notwithstanding paragraphs (a) through (d) of this section, when the
   franchising  authority is regulating basic service tier rates, a cable
   operator that sets its rates pursuant to the quarterly rate adjustment
   system pursuant to  Sec. 76.922(d) may increase its rates for basic service to
   reflect the imposition of, or increase in, franchise fees or Commission
   cable television system regulatory fees imposed pursuant to 47 U.S.C. 159.
   For  the  purposes  of paragraphs (a) through (c) of this section, the
   increased rate attributable to Commission regulatory fees or franchise fees
   shall be treated as an “existing rate”, subject to subsequent review and
   refund if the franchising authority determines that the increase in basic
   tier rates exceeds the increase in regulatory fees or in franchise fees
   allocable to the basic tier. This determination shall be appealable to the
   Commission pursuant to  Sec. 76.944. When the Commission is regulating basic
   service tier rates pursuant to  Sec. 76.945 or cable programming service rates
   pursuant to  Sec. 76.960, an increase in those rates resulting from franchise
   fees or Commission regulatory fees shall be reviewed by the Commission
   pursuant to the mechanisms set forth in  Sec. 76.945. A cable operator must
   adjust  its rates to reflect decreases in franchise fees or Commission
   regulatory fees within the periods set forth in  Sec. 76.922(d)(3)(i),(iii).

   (f) For an operator that sets its rates pursuant to the quarterly rate
   adjustment system pursuant to Section 76.922(d), cable television system
   regulatory fees assessed by the Commission pursuant to 47 U.S.C.  Sec. 159 shall
   be recovered in monthly installments during the fiscal year following the
   year for which the payment was imposed. Payments shall be collected in equal
   monthly installments, except that for so many months as may be necessary to
   avoid fractional payments, an additional $0.01 payment per month may be
   collected. All such additional payments shall be collected in the last month
   or months of the fiscal year, so that once collections of such payments
   begin there shall be no month remaining in the year in which the operator is
   not  entitled  to such an additional payment. Operators may not assess
   interest.  Operators  may  provide  notice of the entire fiscal year's
   regulatory fee pass-through in a single notice.

   (g)  A cable operator that submits for review a proposed change in its
   existing rates for the basic service tier and associated equipment costs
   using the annual filing system pursuant to Section 76.922(e) shall do so no
   later  than 90 days from the effective date of the proposed rates. The
   franchising authority will have 90 days from the date of the filing to
   review it. However, if the franchising authority or its designee concludes
   that  the  operator  has  submitted  a facially incomplete filing, the
   franchising authority's deadline for issuing a decision, the date on which
   rates may go into effect if no decision is issued, and the period for which
   refunds  are payable will be tolled while the franchising authority is
   waiting  for  this  information, provided that, in order to toll these
   effective dates, the franchising authority or its designee must notify the
   operator of the incomplete filing within 45 days of the date the filing is
   made.

   (1) If there is a material change in an operator's circumstances during the
   90-day review period and the change affects the operator's rate change
   filing, the operator may file an amendment to its Form 1240 prior to the end
   of the 90-day review period. If the operator files such an amendment, the
   franchising authority will have at least 30 days to review the filing.
   Therefore, if the amendment is filed more than 60 days after the operator
   made its initial filing, the operator's proposed rate change may not go into
   effect any earlier than 30 days after the filing of its amendment. However,
   if the operator files its amended application on or prior to the sixtieth
   day of the 90-day review period, the operator may implement its proposed
   rate adjustment, as modified by the amendment, 90 days after its initial
   filing.

   (2) If a franchising authority has taken no action within the 90-day review
   period, then the proposed rates may go into effect at the end of the review
   period,  subject  to  a  prospective  rate reduction and refund if the
   franchising authority subsequently issues a written decision disapproving
   any portion of such rates, provided, however, that in order to order a
   prospective rate reduction and refund, if an operator inquires as to whether
   the franchising authority intends to issue a rate order after the initial
   review period, the franchising authority or its designee must notify the
   operator of its intent in this regard within 15 days of the operator's
   inquiry.  If  a  proposed rate goes into effect before the franchising
   authority issues its rate order, the franchising authority will have 12
   months from the date the operator filed for the rate adjustment to issue its
   rate order. In the event that the franchising authority does not act within
   this  12-month  period, it may not at a later date order a refund or a
   prospective rate reduction with respect to the rate filing.

   (3) At the time an operator files its rates with the franchising authority,
   the operator may give customers notice of the proposed rate changes. Such
   notice should state that the proposed rate change is subject to approval by
   the franchising authority. If the operator is only permitted a smaller
   increase than was provided for in the notice, the operator must provide an
   explanation to subscribers on the bill in which the rate adjustment is
   implemented. If the operator is not permitted to implement any of the rate
   increase that was provided for in the notice, the operator must provide an
   explanation to subscribers within 60 days of the date of the franchising
   authority's decision. Additional advance notice is only required in the
   unlikely event that the rate exceeds the previously noticed rate.

   (4)  If  an  operator  files  for  a  rate  adjustment  under  Section
   76.922(e)(2)(iii)(B) for the addition of required channels to the basic
   service tier that the operator is required by federal or local law to carry,
   or,  if  a single-tier operator files for a rate adjustment based on a
   mid-year channel addition allowed under Section 76.922(e)(2)(iii)(C), the
   franchising authority has 60 days to review the requested rate. The proposed
   rate  shall  take  effect  at the end of this 60-day period unless the
   franchising authority rejects the proposed rate as unreasonable. In order to
   order refunds and prospective rate reductions, the franchising authority
   shall be subject to the requirements described in paragraph (g)(1) of this
   section.

   (5) Notwithstanding paragraphs (a) through (f) of this section, when the
   franchising  authority is regulating basic service tier rates, a cable
   operator may increase its rates for basic service to reflect the imposition
   of, or increase in, franchise fees. The increased rate attributable to
   Commission regulatory fees or franchise fees shall be subject to subsequent
   review and refund if the franchising authority determines that the increase
   in basic tier rates exceeds the increase in regulatory fees or in franchise
   fees allocable to the basic tier. This determination shall be appealable to
   the Commission pursuant to  Sec. 76.944. When the Commission is regulating basic
   service tier rates pursuant to  Sec. 76.945 or cable programming service rates
   pursuant to  Sec. 76.960, an increase in those rates resulting from franchise
   fees or Commission regulatory fees shall be reviewed by the Commission
   pursuant to the mechanisms set forth in  Sec. 76.945.

   (h) If an operator files an FCC Form 1205 for the purpose of setting the
   rate for a new type of equipment under Section 76.923(o), the franchising
   authority has 60 days to review the requested rate. The proposed rate shall
   take  effect  at  the end of this 60-day period unless the franchising
   authority rejects the proposed rate as unreasonable.

   (1) If the operator's most recent rate filing was based on the system that
   enables them to file up to once per quarter found at Section 76.922(d), the
   franchising authority must issue an accounting order before the end of the
   60-day period in order to order refunds and prospective rate reductions.

   (2) If the operator's most recent rate filing was based on the annual rate
   system at Section 76.922(e), in order to order refunds and prospective rate
   reductions, the franchising authority shall be subject to the requirements
   described in paragraph (g)(1) of this section.

   [ 58 FR 29753 , May 21, 1993, as amended at  59 FR 17973 , Apr. 15, 1994;  59 FR 53115 , Oct. 21, 1994;  60 FR 52119 , Oct. 5, 1995;  61 FR 18978 , Apr. 30, 1996]

   Effective Date Note:   At  60 FR 52119 , Oct. 5, 1995, in  Sec. 76.933, paragraphs
   (a), (b), (e), and (f) were revised; (g) and (h) were added. This amendment
   contains information collection and recordkeeping requirements and will not
   become effective until 30 days after approval has been given by the Office
   of Management and Budget.