HomeMy WebLinkAbout0488.093< •
September 16, 1393
The Honorable City Council
Palo ~to, California
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a'§QLVTIQN 01' TaB COUNCIL 01' tBl!i CITY OF 'pAL.O ALTO IN' ACCORDANCE
WIT» '!'BE ~onrr rEBeIS' QP POWB~ AGREEMENT BY AND AMONG THE CZT_,IBS
Q' PALO MLrQ, JmNLQ PARI' BAS"t' PALO ALTO, THE TOWN' OF A"MrJRTQ}J. AND
THE CO!!N'1'ZBS OF SANTA CLARA AND SAN MATI!O. A!1Tl!ORiZES THE PILINJ;l
poE C'RTIPlCATXQH WITH THi FCC ~UGULATE BASIC CM_~SER.VICI
RAtg AMP ADOPT THE FBPKRAL COMMUNICATION CQMMIs.srONs S C'OSTOME'R.
SDVTCE STANDARDS.
Members of the Council:
'eport in Brief.
The purpoee of this report is to request that CD1IDcil approve a
resolution on behalf of Palo ~to and the other Joint Powers member
jurisdictions to regulate the basic cable service rate as allowed
under the Cable Television Consumer Protection and Competition Act
of ~992 (199.2 Cable Act); authorize the City Manager or her
designee to (i1e Federal Communications Commission (FCC) Form 329.
·Certification of Franchising Authority to Regulate BaBle Cable
Service Rates and Initial Finding of Lack of Bffective Competition"
with the ~i and approve the notification letter to Cable Co-op of
the City's intent to enforce FCC Customer Service Standards and/o~
continue to enforce the Amended and Modified Franchise Agreement
Section 9 - -Additional Subscriber Rights" whichever method of
enforc~~ent is more beneficial to the cable Bubscriber.
Diaeussio!L
The 1992 Cable Aet"s basic premise is to curb rapidly increasing
cable television consumer rates and ~rove customer service. The
1992 Cable Act' e requirements extend to numerous areas of cable
television operations. Same of the law's provisions apply only to
certain types of mul tichannel video programming distributors, while
:'lthers affect all players involved in providing video programming.
See attached 'Summary of S. 12 -The Cable Television Conswner
Protection and Competition Act of 1992 w for details.
perhaps most significantly. the act 're-regulates W the industry,
changing the way broadcasters, cable systems. local governments and
progra.n-mers conduct business_ While the 1984 Cable Act took a
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general hands ·off approac11 to cable, there now exist federal rules
for almost all aspects of cablecasting. ranging from what broo.dcClst
stations must be carried and how they are arranged, t.o the
paramet.ers that may be establ:i shed for rate. sett ing and minim;Jtn
standards for customer service.
Local goverrur.ents may begin enforcing new federal regulations
governing cable rates and customer service standards this fall. In
order to regulate basic service rates and the rates for e~~ipment
and installation used to receive basic cable sel-vice. local
franchising authorities must be certified by the FCC and may begin
filing certification requests (Form 3.28) September 1, 1993.
Complaints regarding cable programning service tier rates {Fol.'i!l.
329) may be filed with the FCC ort that same date. At this time,
Cable Co-o~ has indicated that they will not be tiering rates (all
cable programming will be included in the basic tier). Therefoce,
it i8 not necessary for the City to file Form 329.
franchi_A AYthority CertifiCAtion
A franchising authority seeking to regulate the basic tier cabl;a,
rates. which includes all local tel evision broadcast channels
{conrnercial and non· commercial) and public. educc;;;,tional and
governmental (PEG) access channels. and any other video progranmting
a cable operator chooses to place on the basic tier, ~Jst first
file a written certification with the FCC that it:
1. will adopt and administer rate regulati.ons consistent
with FCC regulations;
2. has the legal authority to adopt, and the pe~8onne~ to
adminiater~ such regulations; and
3, will adopt laws and regulations providing a reasonable
opportu.nity for consideration of views of interested
parties~
Franchising certifications will be deemed effective 30 days after
filing r u~ess the FCC determines that the franchi~in9 authcrity
has not met the three criteria. The franchising authority will
then have an opportunity to revise or modify its certification.
cwle operators or other interested parties tray petition the FCC at
any time to ~evoke a franchising authority's certification.
The FCC itself ~nst step in and exercise jurisdiction aver rate
regulation if it (a) disapproves or (b) revokes a franchising
authority'S certification. If the franchising authority chooses
not to file a certification. the FCC will not step in; and local
franChising authorities would have no authority to order rollbacks
of basic l.-ates or to protect consumers from continuing increases in
the basic service or equipment charges.
CMR:488:93 2
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UDder the nelrw" regulations, franchising authorities may regulate the
rates for basic service (i.e.; the tier containing local television
broadcast stations. PEG channels and any other programming placed
by the cable operator on that tier). and the rates for equipment
and installation used to receive basic service. The PCC 1I;'ill
regulate the rates for cable programming sen.-ice tiers (,i.e., all
tiers of service other than premium and pay-per-view programming) •
but the FCC will do so only in response to complaints from
franchising authorities~ subscrihers or other relevant govenunental
entities~ The rates for pr~~~~ channels (e.g., Home Box Office,
Cinemax, Bncore) and pay-pEr-view programming are not subject to
regulation.
Cable rates are subject to regulation only in franchise areas not
subj ect to -effective competition~ -which is defined as a frc.nchise
area:
~. where the cable system serv~s fewer than 30 percent of
the households in the franchise area; or
2. which is se-rved by at least two unaffiliated multichannel
video pr~ramrning distributors that cover 50 percent of
the franchise area and serve 15 percent or more of the
households; or
3. where a municipally-owned system covers 50 percent of the
households in the franchise area.
tinder the new rules, the FCC will presume that rates can be
regulated in all markets; and cable operators must show they are
subject to effective competition. Under these rules, the cable Co
op system is not subject to effective competition, because they
serve 47 -SO pErcent of the households in the franchise area and
there are no other multichannel video programming distributors that
mee-t the criteria above. Therefore~ Cable Co-op wOlJld be subject
to rate regulation 1JpOn certification of the City by FCC.
Local franchising authorities may begin filing requests for
certification to regulate basic service rates on September 1, 1993~
although there is no time limit by which franchising authorities
ltTUst: file a certification request. September 1 also is the
effecti~~ date of the FCC's rate re~Jlations. Franchising
authorities. cable subscribers and other relevant governmental
entities rray begin to file complaints about the reasonableness of
cable programming service tier rates on that daLe.
Both a request tor certification and a complaint regarding nonbasic
rates are to be filed on official FCC forms (see attachment) .
CMR:488:93 3
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The FCC' B rate regulations establish a formula by which cabl~
operators determine their rates for basic and cable programming
Bervice~ and t.hen compare them against a benchmark rate derived
from basic and cable programming service rates in competitive cable
environments. Generally. rates in effect on September 30. 1992
that are above the benchmark rate must be reduced by 10 percent or
to the benchmark rate, whichever is less, or show that the higher
rates are justified baAed on a cost-of-service showing. Cable Co
op has notified the City it plans to requeet a cost-of-service
showing.
C~le systems that do not have competitive benchmark rates are
permitted to demonstrate by a cost-of-service showing that rates
higher than the benchmark rate are justified. The FCC plans to
develop and propose national cost-of-service standards by November
1993 to be used by cable systems in making rate justifications. In
the meantime, cabl~ systems and local franchising authorities are
expected to use general cost-ot-service regulatory principles.
Because of staff's lack: of expertise in administering ccst-of
service regulatory principles, it will be necessary to hire a
consultant or firm to review Cable Co-op's cost-of-service
jus~ification_ This process will follow certification~ and staff
will return to Council in November or December with a contract for
consultant services and a budget amendment ordinance (BAO). Staff
anticipates the contract will be under $25,000.
CUstm"r S9ryice Standards
The FCC~ s new customer service regulations set minimum national
standards for:
1. office hours and telephone availability;
2. installations, outages and service callsi and
3~ communications between the cable system and subscriber,
billing and refunds.
A copy of the PCC Customer Service Standards are attached for your
review. Although the federal standards became effective on July l~
a franchising authority CaLU~ot enforce the standards, unless it has
provided the cable operator 90 days' written notice via certified
mail of its intention to enforce the federal standard6~ A
franchising authority retains the right, however, to establish
and/or enforce existing customer service standards that exceed the
FCC's standards~ or Which are not covered by the FCC~s standards.
Such local standards may be enforced pursuant to a franchise
agreement, or by state or local law or regulation.
CMR:488:93 4
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S~aff has prepared a letter to notify Cable Co-op~ upon Council's
approval, of its ir.l.tent to enforce the FCC Customer Service
standards and/or continue to enforce the customer standar.ds in the
Amended and Modified Franchise Agreement Section 9 --Additional
Subscriber Right:s I whichever method of enforcement is more
ben~ficial to the subscriber.
'i1v='ry of Basic Servige Regulatory p~
Action
City Adopts Regulations
File Certification
Certification Bffective
Notice to Cable Co-op by certified
mail that certification has occurred
and uecessary rules have been adopted
Cable Co-op Files Rates
City deci~~s case, or issues order
saying more time needed
City decides case or allows rates
to take effect subject to refund
Written decision and order to roll
order back rates, if appropriate
Staff recommends that Council:
E.tfect.ive Date
9/20/93
9/22/93
Automatic~ 30 days
after tiling: 10/22/93
10/25/93
Earliest Date Due:
11/25193
MUst issue 30 days
3fter Co-op filing
of rates
~20 days after first
order for cORt-of -service;
90 days for benchmark
~::20-1S0 days after first
for rate review
l. Adopt the attached resolution deterndning that the cable
television system operating within the Joint Power~ service
area is not subject to effective competition and authorize the
regulation of basic cable service rates;
2_ Authorize the City Manager or her designee to file with the
FCC Form 328.. "Certification of Franchising Authority to
Reg-Illate Basic Cable Service Rates and Initial Finding of Lack
of Effective Competition-; and
3. Approve notification to Cable Co-op of the intent of the City
to enforce FCC Customer Service Standards and/or continued
CMR:488 :93 5
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I enforcement of the customer service 3tandards in the Amended
and Modified Franc!1ise Agree;:rent Section 9 Additional
SUbscriber Rights~ whichever method of enforcement is more
beneficial to the subscriber.
Respectfully submitted~
Resources
Attachments: 1) Resolution Regulating ~ic Cable Se~vice Rates
CMR:488:93
2) FCC Ponn 329 ·Certification of Franchising
Authority to Regular Basic Cable Service Rates and
Initiate Finding of Lack of Bffective Competition-
3} Certified Letter to Cable Co-op
4) Summary of S .12 "The Cable Television Consumer
Protection and Competition Act of 1992-
5) FCC Customer Service Standards
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RESOLUTION NO.
RESOUJTION OF THE COUNCIL OF TIlE CITY OF PALO ALTO
FINDING AND DBTERMINING THAT THE CABLE TELEVISION
SYSTEM OPERATING WITHIN THE JOINT POWERS SERVICE
AREA. INCLUDING THE CITY OF PALO ALTO, IS NOT
SUBJECT TO EFFECTIVE COMPETITION AND AL'THORIZING
THE REGULATION OF BASIC CABLE SERVICE RATES
WHEREAS, the City of Palo Al~o (nCity·) is a party to an
agreement enti tIed I'IJoint Exercise of Powe:rs Agreement by and among
tha Cities of Palo Alto r Menlo Park, and East Palo ~to, the Town
of Atherton, and the Counties of S~nta Clara and San ¥ateo~ (-Joint
Powers Agreement·) 1 and represents t:r~6 interests of the parties
(·Joint powers·} in connection with the cable television system
(-system") operated in the joint powers service area ("service
Area·}; and
WHEREAS, the Counc11 of th~ City of Palo Alto \"Council r )
finds and determtnes that the System operating within the Servi~e
Area is not subj~ct to effective competit.l.on under the Cable.
Communications policy Act of 1984 1 as amended by Section 623 (a) (2)
of the Cable Television Consumer Protection and Comnetition Act of
1992 (!lAce-), 47 IT.::LC. § 543 (a) (2}; and -
WHEREAS~ the Council will. within 12D days of certi fi
cation of the City by the Federal Communications Commission (~FCCW)
as a franchising authority authorized to regulate basic cable
service rates~ adopt and admlnister regulations with respect to
basic cable service chat aloe consistent with the regulations
adopted by the FCC pursuant to Section 623{b} of the Act, 47 U.S.C.
§ 543 (bJ; and
WHEREAS, under Article II of the Charter of the City of
Palo Alto, Article XI I Section 5 (al of the constitution of the
State of California. and the Joint Powers Agreement, t.be Council
has the legal authority to adopt and administer the regulations
with respect to basic cable service ratES; and
WHEREAS, the procedur~l ~aws and regulations applicable to
basic cable service rate regulation proceedings by the City provide
for a. reasonable opportunity for consideration of the views of
interested parties;
NOW, THBREFORE 1 the Council of the City of Palo Alto does
RESOLW as follows;
SECTION 1. The Council hereby approves and authorizes the
City Manager l or her designated representative, to file on behalf
of the Joint Powers~ an application for certification of the City
as a franchising authority to regulate basic cable service rates
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and an initial finding of lack. of effectiV"E competition with the
FCC.
SRCTIQH....,2. Thl; Council further approves and authorizes the
City Manage!', or her designaced representative, after the effective
date of the FCC's approval af the City's application for certifi
cation to adopt and administer regulations with respect to basic
cable service that are cOljsistent with the regulations adapted by
the FCC pursuant to Sect-ion 623 (b) of the Cal::le Television Consumer
Protection and Competition Act of 1992.
SECTION '3. The Council
approved does not constitute a
Environmental Quality Act.
INTRODUCED AND PASSED!
AYES:
NO~S,
ABSENT
ABSTENTIONS,
ATl'EST:
finds that the
proj eet. under
APPROVED,
City Clerk Mayor
City Y..anager
action hereby
the California
Senior Asst. City Attorney D:'.rector of Information Reso;Jrces
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-~ -"" ... fCC 328 1'->cc u.. 0""
CERTJFICA nON OF FRANCH 151 NG AUTHOR lTV TOR IGU LA IE BASIC CA':-:-S=-LC::E'"'s"'e"'R'"'v"'IC::-:E'"'RA:-,c::r"'e7s--'
AND INITIAL FINDING Of LACK Of EFFEClWE COMPETITION
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. e of" P,!Ilo Alto Inc • . -.............
-3200 Park Boulevard
"'" I~ I la-Code Pale Alte 94306
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nnE 11" SlCTION 1101).
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INSTRUCTIONS fOR fCC 328
FRANCHISING AUTHORITY CERTlFICATION
1. The CIOIe TeleovliiOl'l c~ F'TtKec'ol1 r.d CompeIillQ(1 .'d..
enacm: itI OcIobft' 19192, d\in~ tftI! 'NI'U'It" ir1 wtltd! oohle
~ I"(JIeI'r'I:S 1N!.Ift' nOlI $ubj~ ttl ~iwt' ~iciorl.are
~,.IrI~ .. f. Qtet.forthe ,,;nit "O'YjcrIjNtJr.etotr-~j~
.... condition d K.:a!f5 10 all ~ Y'iOeo 5efYlCn .,d COflC;a,runs.
a.~J gdo.,# 5ef'Vic:u, loa' btwcka$I 5tation sipub MId publiC,
1tducaborIII, Md p.b11c-1ICC'e1~ ~ MCi ~ ~ij)moI!Ot
... n bI!" Io..Obj«1 ID "'~'-'on by lou! 01' stIfe JC1I'I'I'nmentlo
ifr;w1chiIinf ¥JIhoriI.ia'i. RiIIIII!I for~ ~",i"lJ seMces and
1SSOciaced~(.111 J.etYit'eS ~ b.Is.ic nplf)l~l.)wili
be tubjed ID .. "'" b)o the FCC. fbtes 101 M' channel,
(channea lOr who there is ~ Jpedik ,...-ctunMI Dr I*~
cha/wIJ .. ~ N!fU1aI:ed
2. Only ClIble systenlS tII.-M' rMJI ~ t:I~;...e OJmpeImon rnzy
be-repliDd. EHectNe cuonp«IIion mea'U chat (.aJ fewer th;v! ~
perceru 01 the hc~, .. se~" the li'anctIi:soe.aru ~bKJibe II) tNo c.abt.
~ f1f 10 ablil! J)"Iem.; Ill) the fTar.chiloifl &rU is fil ~ by.ill: ~
~ 1lI\o1ffi1~ mullkh.inN!1 vi~ ~m, distrbu1cn uct. rJ
which ~ com;wable video p:oa:rammm,to.:1e.asI JO petC!trt d
the housetIokU in 1M hI1chiw -..; And em ~ n~ d
tIoutdIoIdI !Ubtcrib'rJl! to ~il'l' ~kti o#Iered by
mOl~ ",Ideo ~;"J .r!1II.-?t!utors <lCher tharl IfIe ~
mul!~ video Provarnmilll di51ribl.'\Of e:w:~ 1 ~ pe!O!n! of
the howsthokto. ill It. fnnctliSflo inA; or Id • m'~lIicbwlrwl .-ideo
~min, dismbutor~ by th! frilnChi:s;"1 ~ for !Nt:
fr ... .cf,iw ¥til otJen. video ~G 1tI_IINsI.so pet't!I!n! dIN!
~ Irl ttIa: frandlis.e aiel.
l. In Ot'doer to ~~ b.:K 5eMc:e tier rotRI, .II fronchisint .&WloriIy
must be ~ by the FCC. In Ofder t;;) be cen:ifietf, a fJan.:hi1inl
a.chomy mull c:omplre\e 1M fmm. M oriJiMI.-f one-«IPY of the
cxnpIettd form and ;III .IIItK""-tJ 1nU5I be ~ til dw FCC
by ~ -. Ntun. ~ ,....." 18 the FCC • eM
..... OIII .. fomt.
.... Amp)' oIlfoe bm must bf! ~ 0'" tI-co c:.b$e opeo-...-by /iru-dass
,..,,;J on tJt before Ifoe d_ the foml is.;eo: cr OeI"rvered 110 ft fCC.
5. The f'randrisn, tiIfhority's ml1ifia1:ion will beo:wne-e!'ieaiw lQ..dixl
.,....,. d& 51....,.t .... tfr....gar!WJm !!(liN""!au othen¥ise
notified by at. CommisUon by 1M dare. The b'lCftisml .autt.onry
cannot beiin 10 IIeJUIMe ras. ~, UIlIiI II: P\Is ~ ~
the requift!d f2I1IlIticn!I.Joee below! iIlI.d UITlil iI hi!. rI(I(iflaf kcMJie
operatortha iI n. ~ ~ N tha it ~ ~the ... 1fK ----ft. ., CIfder Ia bto Uftified, ~iliin£ oiUIftorite mlJ5il ~ "')'eI' to
Que:sOOnt 3, ~, ~ S, ",,1Jicfl VW' upl.amec' ;til follows:
'1. Queslim J; The f~~inl .authority must iJdopt me J'tIlUions
~ .,oith-the c.o..,~'s 1q.U~ let b<I5" t.Il;l..loIIro'ia!,
To IUIff'I'io dli.J ~ for c:enif'icziM, the frar,cruslnS ..monty
I'niqI Iknpfy .adopr .a feJUlaOon irMfiCillinl tha it wiJI follow _
repIoIIiOns 1tSfabr.shtd by the FCC
The ~ aumoriCy has 110 days 10 adopc the$ot ~iofu
.." the-litM II 15 0Mif1eCl l1w fr......;,i~"1 .wftootily IT'\Iy not,
~. betin 10 rquL!lI!' C41b1eo .... I,ro(il ;me, it has ~ tt
~~ If\d ~liT iliull noCfled ttIe callie-oper.ac01'!tI.a! ir h.as ~
~ N ".adopr2d the IftjUiM ~ioru,
I. ~Ooo 4lJ: The fr~inloilut+tcrity'5 ~~loiI:IlhoJltf" II:> 1'eC,,!.ie
Mit: .... ic:e mull come from Wile bw. In spme s'ales 00,"" The
pM!JC'!!Ief!IfDCD! may IHl'Latr rtble r;wtn In theM Slates, !he aee
~men1 ihouid tile d-oi .. ~ir!UlliCll'1, f>rOltl~~~ in f,-"ndlilie
~ tNl9fObibil J"aI!! n=wu~.al'l! mid. IIld do not ~
.. fT~ ~ (I'l)m re&ui..alin, rile bask !leC\'iCe riel' 11M
asociafd equipment.
QvMtiOl'1 4tbl ThI!' fToiI"c;';Ji'1l1 oiIu'horify mlJ~ ~ .. IUf!~
.. ,-""be, of pet!.Ol1nf! Iv u".!I!!r"~1!! me-~ .. WiOtl.
A franchise -avttlorify I.PIo.ibIl!' 10 .11"_ '~. II:> (ti.llHtiol'oi 4W (If "'Cb)
m.,-Wi5~ 10 ~ the FCC'~ tmo" tOri Qrd rr in Qxt ... ".1"
FCC 93---1 n ~Ie.-.ed M.-, J, I99J) for fun~ ir'I~ CIf'IIhe
~'~! 0( lIitem.ac1ve ~ ~Iatory proc:ed<.IM.
9. Q!.lIeSI.ion 5~ F~eI1j~"2 ...noritiel m~ ~ proced~ repll..Kion'll
-illowi",SIot p .. bllC" p.utici~iOl1 In 13:'1!! .latiM ptOCetdinlS-t;a
iriInch~"il alIthority does no! ~ .. lhese !'e'f'J~Oau IlI111dy in Place..
~ m\iSl: Wopilhem wiltlio l:;1l d.tys 01 CMifiC.<lliO'!'l -If'd ~ ill ~
~rm-~~ion.
10. Question 6; MosI wle ~s V!" llaI subjea 10 ~
tnmpel"","." drflrw;od br me UbIt-Ad !The dail"mon Il ilKluded
~.,d on Ih:! fpnn,) TI'e ~d'1i$i"I;;n"d\oriry /MY ~ ~
:he-c:lble ~ ~n its jlolriMlicllon is rllX wbj.Pct to ~
""""""'" FQ!'" puTP05a d ~n, the 6elinitioo of dediYe ~ (lei
!'!em l a.boveJ, ·m"~lcf'l.1nrtelvideo-P>op"ammjn~ d,Ifrlb~' ind.de
oil atIf.!. oper'-llor, .. m .. ~~nel m",t[;poim d;$lribvtiQl'l ~ ..
di~ b~ wenitr 1e!'V~ .. le\el.oi,1ocn ~Iy wtellile
~ di~ ..... ideo cf''-lh0l''e servia, I:'Id II :Ult-l~ masIIef
ar.~n;a television sysIrm.. ,., m~"~r'lel viOeo procr-inll
dlsmi:nrtO""1 wMces will be dftmecI .~ when tMv ;no bom
II!-chnic.l~ IIld ~ ~~~. SeMce-is "tec+wIically avai1abft-~
...men !he mulliCNMel di~ is pr.ysiQIl\" lIbie to ~~ ltle
5ef'<1a 10 .a ~s-ehok! ..m!ling II:> sa.bscribe, with only mini-m/
a6d~ ~Wnent by :he dillribll1or. .4. ~a is. .~
~~Ia1oIe' • ~ ill ~ francf,jse area are reasonably ;IIWft
tfl,O\IItI m.ane.inl ~ Ih.ac the.lol!!!Vlce is _l.ab~ So-I iba gUp
cimose 1m'1I~ .. ld!!oprogramminJ di>trib:llon-dEerina ~
to • INsl SI) pI!!I'aI'II 01 h ~ 'r1 .. fantniw --.:I wii bI
~ 11:1 ~ne wherhe! • Ie.asI 15 percent d the
~ in the franchiJe II!'eiI ate .Je1"W'Pd by ~ II
multi.:t.aN'.P1 "ideo prosT.unm;rll d'L$ribvtor mllit: ... Ie.!: U
~, of pn:.'f!~ • 111'11501 one ciwlneI of whidl Is
r.cJi'l~ to bill! fou'oCItOoI1er~compiIrai;ole~ ~ PI ........ ;.,..
11. This ~~ bm m~ be ~&ned br. ~t oSlki.I 'IIriI:h
uMrity to oK! on behilf 01 me fnndlima:~.
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VIA CERI1F1ED MAlL
101m Kelly, President
Cable Co-op
3200 Park Boole;'anf
Palo Alto, CA 94306
Dear Mr. KeUy,
o
CitydlPaloAlto
DqwtmtntofInfor=tion &:;oums
Sep<ember 16, 1993
On April 7, J 993, the Federal Communkations Commission releaseol a RqJcn
and Order adopting. new rule (47 C.F.R § 76.3(9) implementing Section 8 of
the Cable Television Consumer ProIection and Cnmpetition Act of 1992; that
section governs the establishment, implementation and enforcement of customer
service stancIam. foe <:able operators nation .. i"". A copy of the ..,,,. rule is
enclosOO.
Paragnq>b (e) of the new rule establishes federn! customer service stancIam.
("fedetal standards"). Paragnph (a) of the \leW rule provides that. fl2lldlising
authority may enforce the federal standards, but in order to do so, the franchising
authority must provide affected cable opcratots 90 days' written IIOtY.:e of its
intent 10 eaforce the SW>dards. This leiter constiJutes the City of Palo Alto',
notice on bebalf of the Joim Powers of its iroent 10 enforce the federal standards.
The City intends 10 begin enforcing the federal standards on December 21, 1993.
PaIagnpb (b) of the oow rule reserves to franchising autbotiti .. , amOflg other
tbing<, rights to establish andior enforce state and local customer service
z<quirements that exceed or are DOl covered by the federal standards. The City
of Palo Alto """,,,es and intends 10 exercise all rights identified "' the Amended
and Modified Franchise Agreement by and between the City of Palo AlIO on
bebalf of the Joint Powers and Cable Communications Cooper.dive of Palo Alto.
Inc. (Cable Co-op).
Sincerely,
Diauah Neff
Director
Enclosure
PD. BadCI250
PahA}fo, CA 9r43OO
415. 329_2313
4L'i 3218l56Fax
SUMMARY OF S. 12
THE "CABLE TELEVISION CONSUMER
PROTECTION AND COMPETITION
ACf OF 1991"
Introduction
On October 5, lhe House and Senlla OVOlToc!e. presidcnlial
veto and enacted S. 12. tho 'Cable Telwision Canlumer
Proteclion and Competition Acl of 1992' (hereafter refemd \G as
'5. 12" or 'Iho neW law'). The Senale Overrode Presid .. " Bush's ~
veto or llIe I.gistalion by I YOle or 74 to 25; tbe House followed VI
.uil with a 308 to 114 vale. This congressional vola marlcal the
firsllime Congress has overridden a veto by Prosidenl Bush.
S. 12 should promote competitioll in the cable television
industry and help curb unfair rale Increases and other CUSlomer
serviCe abuses by cable lelevision opcrocon. S. 12 ,!lilts loc.al
governmenls addiUonal IUlhorily to help promOte CQmpctition and
~urb cable operators' abuses, and provides local lovetnmenl! willl
immunily from monetary dama,.. in suil! challenging tbeir
regulation of cable systems.
S. 12 r",uire. th. Federal Communications Commission
('FCC' or 'Commission') and local governments 10 W<e many ()
action, within the ncxt year to Implement the provisions or s. 12. ~.
It is critical that local governments parlicipate in implementation
proceedings before the FCC in older to ensuic 'that cable
subscribe,. receive th. maximum protection under S: 12 and thaI
IQC.:II govemmentl have the ability 10 protccleable subsenters to
the (ull eatenl allowable under the new law.
The followin, Is • ~ummary of Ihe major provisions in S.
12 and of Some of Ille critical deadlines (or aclions by the FCC
and local govemmeolJ.
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SUMMARY OF 'rIm MAJOR I'ROVISIONS
IN S. 12
I. R.I. R.,ul.UDn
A. R.gulalo,
S. 12 permits rale regulation where a cable syslem Is not
subjecl to 'effective competition' (which is definw below). II Is
assumed Ihal. under the new law, a very substantial majority of.1I
cable syslems will now be subject to rale regulation.
(I) Fmncilising Authority
The Commission shall en.ure Ihal Ihe rate for basic cable
service i" "rcasonable.' In establishinc I realDnable rate. the FCC
is direcled 10 establish regulalions 'designed 10 achieve Ihe goal o(
protocting subscribe!s '" (rom rates for the basic service tier
Ihal e«oed Ihe rales Ihal would be charged for the bllic service
lier if such cable system were $\.Ibjcct 10 effective competition. II
S. 12 lists some o( the faclors Ihe FCC 'hall \like inlo account in
establishing a reasonable tale and it establish« a procwure by
which franchising aUlhorhies can be certified 10 "en(orce-the
administration of Ihe FCCls basic t3le regulations. In order to
regulate basic service rate •• a franc~iling authorily must file •
certificate wilk lhe FCC. The certification becomes effective 30
day, after the dale it is tiltd unles. the FCC acl, to disapprove it.
The FCC also i. empowertd to revoke a ( .. anchising aUlhority's
ral< regulalory responsibilities if stale and lor.al rale laws and
regulations are not in conformance with ,the FCC'~ basic rate
regulalions. A (ranchising aulhority has the right 10 apply (or
recertification afler revocation and tile FCC must ael on such a
recertifir~lion requesl witkin 90 days .fter il is filed.
2
m FCC
The PCC is Jiven Ih. aulhOrily 10 ensure IhaIlh. "'tes for
othe, cabl. prog,ammlng service> (except programming services
o{fered on • perodlannel or per·program basi.) are nOl
·un,wonable.' The bill allows a franchising authorilY, other
relevant local o' state gO)lt.mIllOl,1aI enlily. or l ""ble subscriber
10 file a complaint with Ihe FCC challenging a rate as
.. unreasonab:e."
B. Basic Cobl. S.,.,/"
The new law requires every cable operator to provide I
basic service tier containing II leasl the following: (i) lCievision
b",,\dcast !iaoal. carried pursuant to the new law's must carry
p,ovisions; (Ii) PEG channels; and (iii) any signal of any broadcast
.talion Ihat is provided by the cable operalor 10 Illy subscriber,
eJ(cepl a signal which i. seoondarity transmitted by ... tclli~
carrier beyond Ihe local service area of M:h station. S. 12 permits
a cabl. operalor 10 add additlonal video progrnmmlng services 10
Ihe basic service lier. A •• bscribet must purch..., the Luic
servi« lier _. but only th. basic tior -In order to purchase other
",,,,lee. offered on Ihe cable sySlem. The new law contains ..
"anti-buy.th,ough" provision Ihal prohibit. a cable operalor from
requiring a tier of service, othet than the basic: tier, as a condition
of receiving premium cable channtls (SUCh as HBO atld Cinemu)
and pay-per·view channel.. Cable operators must <:amply with the
'lIlli·buy·through' provision as soon as lItey are technically
capable 01 complying: all cable systems must be in compli .. ""
wilhln len years. A cable operator can obtain a limited wlivct of
tnis requirement if the FCC delermines thai complian"" would
r«luire the cable operator to increase its rales; \h. FCC may granl
Ihe cable operator a waiver in such a case for 'SUCh .specified
period .sthe Commission determines reasonable and appropriate.'
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C. GlI"II" CDmp,'ilion
S, 12 d.ranes the cin:umSIanUS under which "effective
compelilion" •• ists as: (i). cable syslem Ihal serv •• fo"!er Ihan
10 pereenl of Ih. households in Ih. franchl.e area; (iI) the presence
of at lean lwo mulUchannel video pmarammlng dislrlbulors In a
(ranchise area if each offer. comparable video pmgramming
servic. 10 al least SO pereent of the cabl. community and If the'
number of household. subscribing 10 video pmgramming services
orr.red by mullichannel video pmgramming distribulors. other
Ihan the largesl such distributor. .xceeds 15 percent of Ih.
households in Ih. franchise area; or (iii) a multichannel video
programming distributor operated by Ihe rranchising aUlhorily for
Ihat rranchise area offers video pmgramming 10 at leaS! SO percent
o( the households in thai franchi •• area .
D. Olll,r Ral •• R,/Dltd Provisions
Significantly, the aulhorily to regulate rates for .he basic
tier and all other cable programming .. rvlce. ~ the right 10
regul.le installation and equipment cosls assocl.ted wilh those
services.
S. 12 allows cable operators to itemize on cable bills cOSls
auributable 10 franchise fees, PEG req,.iremenIS. taxes and other
COSl,; i mpm:ed by local govemments.
The new law prohibit, a caOI. operatar from charging a
cable subscriber for a programming service thaI the subscriber has
nol affirmaovely requested.
S. 12 allows a cable operalOr to offer reasonable discounls
10 senior citizens and other economically-disadvantaged groups,
The new 1.101 requires I cabl. operator 10 refund 10 cable
~ubscribers Ihe ponion of Ihe cable rate paid by subscribers (or
~ __ ~&n?'A-~-'r. "'1"'-"W"""}~"'~~'!!'.
non·baslc lie" of service Ihal Ih. PCC deems vnreasonable from
the period of lime I complainl Is Illed with Ibe PCC.
II. Cuslomer ServIce Standards
S. 12 directs Iho PCC 10 "ellablUh .landatds by which
cable operators may (ulfill their customer service mjulremenlS ••
Th. new law IIl0ws: (A) (ranchllina authorities to establish and
enforco customer service .landard. thai exceed, or differ (rom. lb.
standard. estabUshed by lb. PCC; and (II) franchisin, luth:mlies
and cable operator. to neaotill. standards thai exceed tho .. sel by
th. FCC, The new law also permilS a (ranchl.lng luthori'y to 0
require a cabl. operator to provide thirty days wriuen notice of "
any programming changes,
III. Renewals
S, 12 conlemplates sev.raI changes to the renewal ptoc<Ss.
Among other Ilti.g5, (or tho first time, a cable operator would be
required to provide spedfie ...lttiI1cJl nOlice to invoice (ormal
renewal proceedings, If a cabl. operator provides a wrillen
request (or formal renewal, th. new law would fflluir. a
rranchi,in, authority to commence a formal renewal proceeding '0
laler (han six monihs afler such request is submitted.
S, 12 also amend, section 626(d) of the Cable Act by .. )
striking "e(fectively aequiesced" and inse"lng "or the cable
operator gives wriuen notice o( a f:.ilure or inability to ~u'" and
the (ranchising authority fails to object within a reasonable time
afler r ... ipt of such notice." This amendment remO\les uncertainty
O\'er whelher a franchi$in~ lulbority had notic:.. of (ranchi ..
violations or poor service and over the subjective inlenl of a
(ranchising authority in not objecting 10 franch; .. violations or
Inadequlue service. Moreover. the new law clarifie$, that a coun
shall not overturn a franchising aUlhority's decision to deny a
renewal reque't if it is based on an infraclion of the pmcedural
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r<qu"ements of seclicm 626 lhal a court del.,.mine. i, 'harnlltss
error.' Fina/fy, S. 12 clarir",slhat inv«:atlon of formal r .... wal
proceedings dots nl)l MI"te ~ riChl of a franchiling aul!lority to
revoke a rranchise (or cause during the __ Vl.1 process,
IV, Damages immunity
In one of its MY provision •• S. 12 ,ran!! rranchlJing
authorities immunity (rom monetary damages in moSI r.deraJ, stale
or local lawsuilS cblllenging the right of. franchising authority to.
regutale a cable system. This immunlly apPlies 10 both me!
pending On Oclober 5 and 10.11 .uili IniliMed .f\cr OC!ober S. 1\
appU., 10 (he Cuil tan,. of cable .Ct"i.lory aCI,vitios, inotudin& Ihe
award, renewal, Iransfe.-or amendment of • rranchise Or Ihe
ongoing regulallon of tfle cable sy'tem.
V, Signal Quality Standard;
S. 12 requires t/le FCC 10 establish minimum Icchoic.1
,landatds for "£ .. , quality. aM to periodically update such
standards. II allows a Il3l1chi>ing authority \0 include pmvisions
/01 the enforcement of the FCC', .l.1ndards in • franchise
agreement, and permits ~ franchi,ing authority to =k • waiver
from Ihe fCC to impose mOte ,1110t •• ' ,,,,,,dild., Th. new law
also l<quire, I~e FCC to establish regulation, IQ ensure !hal
vicwf!u o( caMe pro&,ramming havi¢. access to the. emet&tl'l.(;Y
inrQtmaliun provided by the emer&ency broadc.";n~ system.
V I, Multiple Francl,lseI:
The new low prohibits a ft:Ulchi,ing authority from cranling
eKclusive franchise, /Uld unfMSOnably rtfusing /0 award an
addilional COmpetilive fraR()hise. S. 12 SlJIles Ihal, in awardine •
r,anchlse. Ihe (.anchising authority: (A) ,han allow Ihe applicant',
c.able sy'tem a fUfonoble period of lime 10 becolll¢ capable of
providing cable ,e",ie<. to all bGllseh(llds in tb. (ranchis. aru;
_ .. _-...." ,"-~~,·t~":".lf~c:::. """";..~'"".~.";:V""!J.;6J::..
(0) OIay !<quire tdeq~alC ",uranee that lhe cable opera",r will
provide ad<qUlk PEG •• ceu clMnncl capacity. (acilitOtI or
r." •• cial suppon: and (C) may !<qulr. *,oqUltto l$$urance Illo,"'"
cable operator has the financial, technical or legal <lvalinati.,... 10
provide ca.le .feM.". .
VII. Loral Authority to Rqulate Owncnblp
S. 11 e1.rifles tllt. righl of a frantbilinl .uthorily 10
ptOhibit the ownership or <;anlral of & cable system by any perl<lll
bcclu,e of such person's ownership or GOnlrol of any oUlet cable
syslem in 1M franchising authority's jurisdiction Or in
ci.eunlSlanccs in whieb • stale Or franchiSing luthQriIY oelennines
Iha' Ihe acquisilion of sucll a cable system may elimil\alt. or rod,,"
oonlp<etition in ,h. deUvCty 0( cable seNi"" in such jurisdiction.
This provision was d .. igned, amont other purpo .... as .. way \0
rosIer head·lo·head competilion by cable *ralOrs by makin, il
casier {or a franChising authority to deny atl operalOr t/le ",hIla
buy Out j,s compelitor in a p.articulw market.
VIII, Musl Carry
S. 12 r.· .. labli.heil .oquircmcnts for the caniage of local
(ele.ision .talion. by cable syslem., II allows broadca.let>, every
Ihree years, 10 choose between mllldarof)' carriage .nder
uadilional must tarry principl~ OJ payment for rttnllumiuion
,i&MS, iht thoi"" or ~ilher one wOllI~ waive a broadcaster', ri,hl
(0 Ihe OIlier. The new law oxeludes oonc(>mmereial etiuuUcnai
television signal, from the retran.miuion wnWlI pto'i~ion,. WId
requi.es Ibe PCC to: {Al COIIsider the impact of the goo! of
relransmission conSlmI on lbe rales (or basic cablt. service, and
(In tnsure lhal "",b rales are reamnabl.. The bUl establishes ,
must carry regime for local commen:ial televIsion $IlUOtIS, low
power television ',"lions. II\d noncommem.t eiluutiqna1
ttlevision "ation,. A (:jIbl. oper.ltor could satisfy requiremttlU lor
(he carTi'jlt of no.ocommorolal (J( JQW power statiOR$ by wry",
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,uch 11~lion. on ".,used PEG channels. The use of an unusc~ PEG
c.haM~1 to carry a noncontmercial or low power station is,
however, subjecllo approval by the r .. "chising aulhorily.
IX. Municipal Owne ... hlp or Cable Syslellls
s. 11 clatifieslhe righl of a nlunicipalily to operate a cable
leievision syslem, and Sial ... thaI. municipalilY need nOI have a
franchise lo provide such service. It also frees a
municipally·owned cable system from rale regulalion if il is Ihe
only system operating in the marke"
X. Consumer Electronics F..q:ulpmeul
The nelY law It<juircs the FCC 10 issue rogulalion, Ihal
us.Ul'e compatibility between televisions and 'Video cas.'elte
recorders ("VCRs") and cable systems, SO Ihat cable subscribers
enjoy Ihe fun benefits or bOlh Ih. programming available on cable
systeml and the functions aV3ila.ble on their television, and VCRs..
The FCC', regula lions shall: (A) specify lechnical requiremenl,
that permil a lelevision roceiver or VCR 10 be sold as "cahle
, .. dy"; (8) 'equire cable operalOrs 10 offer subscribers Ihe oplion,
if "Iechnically and economically" feasible, of having channels
delivered difet:tly to the'. s.uo!.cribl.fS' \elevision receivers of ~ldeo
CtJssette recorders wiltiout passing chrough a converter box; (C)
pfOn\Qte the eommerc-l¥l availability of converters and of remote
conlrol devices compalible with conveners; (D) require cable
operalors, which orrer subscribers Ih. oplion of renling a remole
conttol unit, to notify subscribers that, instead of tenting a remote
control unil, Ihey may purchase commercially available remote
conlrol units compatible with Ihe cable system', convener bOI;
and (Il) piOhibil a cable operalor from laidng any aClion Ihat
prevenl, a convener bOI supplied by Ihe cable operalor from
operaliog comp>libly with commercially available remote control
units,
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XI, I'ro~rnmnlilla Access
As. further step toward the loal o( incl'<1Isin, colrlpelition
10 edsti.g c1ble syslems, S. 12 pr"hiblts a video programme,
affiliated with a cable operllor (rom discriminating agaiJln a
multiehannd video programming dislributor and, exccpt in limited
cireumslallccs, prohibits an exclusive programmin& COnIRct
belween a cable operalor and a programmer .ffiliated wilh the
cable <>peratar. The prohibilioo does not apply to .. elUSive
programming contraCls enlered into on or before Iune 1, 1990.
The new law a1,o requires tile FCC 10 eslablisb regulations barring
cable operators (rom; (A) requiring a financial interest in 1
programming service. or ·coercing-exclusive pr-ograrnmin, rilhtsA
as • condition of carri~&e: and (8) discriminatinl apinsW
un.rr.lialed programmers. S. 12 direets the FCC 10 establish rules
Ihat limit: (A) the number o( cable subscribers a multiple syslem
operalor (" MSO") can reach; and (8) the number of chaMels on
• system Ihal may be occupied by an affiliated video programmer.
The new I.w proilibiu cable operalors from holding licenses for
mullichannel mullipoinl distribulion service ("MMDS") or
providing saleUile maSler anler,n. !CIevision ("SMA ')V") Itrvice
in arcas served by the cable system, absent an I'CC waiver.
Finally, the new law directs the FCC to: (A) iniliale a ",Iemaking
to impose publiC interest requirements On direct brC'lack::ast satellite
("DBS") services; and (B) require such services to 'eselve channel
capacity (or noncommercial educational or illrormatiun,al uses.
XII, Sales or Cable Systems
S. 12 prohibit, cable operalors from selling or transferring
ownership of a cable system within 36 months (ollowing the
'equisitian or initial ccnst",etion orth.1 system. The C"mmission
may waive Ihe prohibilion for public intere.st ..... onl, subject 10
Ihe approval of a franchi5ing· aulhorily Ihal has Ihe right to acl on
a lIansrer request pursuanl a franchise. Po,' any lransler or sale
after Ihe 36'monlh period, lhe new law Slales Ihat if. franchising
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aulhorlly falls \0 act within 120 days, the transfer il deemed
granled '(unless the cable operator and franchising aUlhorlty agree
10 an extension of time). The 120-<11Y ~rlod does not hegln to
run unlil the cabl. opel1ltor hl1 submitted Information rl:'lulred by
Iho fl'3J1chising IUlhority and Ihe FCC,
xm. LeasediPEG Access
S. 12 rl:'luires th. PCC to establish. formula 10 determine
Ihe maximum reasonable rale a cable operator may charge for
leased aC(.oss, and to establish rta50nable terms and condilions for
such access. A cable operalor would \Ie permitted to use up 10 one
third of its leased access channel C¥pacity 10 provide qualified
educational or minority cable progr;ullming services, regardless
of whether such programming services are affiUated wilh the cable
operalor.
The new law: (A) allows cable operators. pursuant 10 a
wriuen and published policy, to dcclineto carry material on leased
channels which they reasonably believe 10 describe or depict sexual
or excretory aClivities or organs in a. patently orrensive manner as
measured by conlemporary community standards; and (D) directs
the FCC 10 adopt regulations that would require: (1) cabl.
operators 10 carry indectnt programming on only one leased aCCeSS
channel, (2) cable operalors 10 block such channel unless •
,ubscriber requests access 10 ii, and (3) cable programmers 10
inform cable operalors of whether their programming is indecent.
The new law requires the FCC 10 promulgale regulation, thai
would enable. cable operator to prohibit the uSe of PEO channels
to carry 'obscene material, sexually explicit conduct, Or malerial
soliciting or promoting unlawful conducl." S, 12 subjecls cable
openllors to criminal or civil liabUlty for Ihe carriage of obscene
programming on PEO and leased access channels,
to
-------~~',.;..r=· ... ~~rmm37fU'l'!'ll'~~
XIV. ilqual Employment Opportunity
The new law requires cable operalOtS 10 iii. with !he fCC
an .nnual statistical repon Identifying by race, '"" and job titie,
the number of employees In sever:aI full-time and pall-time
calegories. It also codifies the PCC', .. Isting EEO requirements
for lelevlsion broedCl1t stations. .
XV. Home WIring
S. 12 requires the PCC to establish rules concc:mlnC the
disposition, after a subscriber lerminates cable service, of any
cable equipment Installed in the subscriber's home by a cable 0
operator.
XV I. Then of Cable Senlco
S, 12 increases the, penalties for Ihefl of cable service.
XVII. Subscriber Prl ••• y
The new law clarifies severall1pCt:13 of the exi,tin, cable
privacy rules including, among other things, that the delinition of
'personally identifiable infonnalion' under Section 631 of the
Cabl. Act does not include any record of ""regale d.1l which
doc. D2lldentify particular petsons. S. 12 also prohibits a cable ( ,
operalor from g/lllting unauthorized access 10 • subscriber', ,)
In(ormatlon to anyone olher Ihan Ihe subscriber ~r th. cable
operalor,
XVllI. Antitrust immunity
S, 12 clarifies thai it does not a1ler or resirici the
.pplic.bility of (edoral and SIlIC antilrust laws, Since 1984, local
govemments have bt.en immune (rom damages in anlitr\lst cases.
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DATELINE FOR IMPLEMENTATION OF KEY
I'ROV1SIONS IN S. 12 IN THE COMING \'EAR
The following is • summary of actions the PCC mUSI eUher
commence or complete in Ihe coming year.
I. Wllhln 45 Days .r En.tlmenl or S. 12 -
By Noyemb.r 19. 1991
A. The PCC musl commence a rulelnaking proceedin&
to establish reguillions to goyem the c~erclse by
television broadcast stations of their retransmission
or must carry right~. The FCC is required to
consider as pan of.lJlis proceeding the impact of
r.transmission cnnsent on basic cable rates and
must enSure thaI the regulations it promulgales do
nol connlct with Its obligation to ensure Ihat such
rales are reasonable. The PCC musl complele ils
rule making proceeding wilhin 180 days after Ihe
dale of enactment of S. 12 (j.~ .• by April S. 1993).
NOTE: Turner Broadcasting Syslem. Inc. filed a
lawsuit on October S. the dale Ihe neW la',v was
enacted. challenging Ihe relransmission consent and
mUll carry provisions. S« Turner Broadcasting
system. Inc. Y. fiX:. No. 92·2247 (D. D.C. filed
Oct. 5. 1992),
II. Within 120 Days or Enaclmelll of S. 12-·
By Februory 2. 1993
A. The FCC must ~romulgale regulalions r"'luiring:
(I) cable operators to place on a single leased
.ccess ch""nel all indecent programming; (2) cable
operators 10 block such channel unless Ihe
~ub$criber requests access 10 such channetj 8Jld (3)
a programm~1' (0 inform the cable operator if ils
programming would be Indecent.
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The FCC mull prescribe rules concernin, remotal
of any cable Inllliled by a cable or<rator withIn lIIe
premIses of • lubserlber who hi, lerminal<d
subscription.
III. WIthin 180 Days of Enactment of S. 11 -
By April 5. 1993
'A. The PCC musllmpose regulations to ensure Illat Ill.
rates for the basic cable servi"" tier ale reasonable.
B. The PCC mull impose: (I) regulations Idenfifying
whether rates for non-basic programming servlees
are unreasonable; (2) procedures for RSOlu~on of 0
complaints from franchising authorWes, consumers
C.
D.
E.
and other rol .. ",,1 stale or local government entities
aboul unreasonable rales; and (3) procedures for
reducing unrea~nablo rales and ror proYiding
refunds to .ubS(:ribers.
NOTE: LoeaI govemments will have only 180
days after Ihe FCC's rules become dfccli .. to seek
a reduction in existing rale.. An ... the 180 day
period. local govemmen .. can soekreUef only with
respect to changes in cable ralts Iha' are initial<d
after the PCC', rules become effectiYe.
The FCC mu,t impose rules to prev,:nl eVlsior., of I )
Iho FCC', rate regulation,.
The FCC must Impose regulations implementing Ihe
local commercial letevision 'talion muSl<arry
provision •.
The FCC muSI complele ils rukmaki.g proceeding
impJemenling broadcasters' right 10 thaose either
re~(ansltlissio~ consent or must carry.
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T~ I'CC mllSI tslabJl!lll Slinda!'d$ by widen cable
opeBtOfI /l\f.y MIllI !I!cir ~Ul=r se""icc
rMit,li.loM.
The !'CC must establisll rulu for <Ie\erminlnl lilt
""",lmum ttlsonableo tlI\et, aM ~ \emlS lII<I
toodlllons, of lea,"" .~n.
The!'CC must promulple !"qulallons 1(1 enable an
~ of • cable S)'rtem In prollibit !M =, om
$!!clI system, of P1ID d,,,,",,,u ft)f M1j programming
«\\\wmna OOS<;l:M mliWil, su,uatty elqllidl
e<m<!w;t. or _Ml n!!<:l\iAg Of promo!in~
1I\llawful coruluct. .
The FCC mIIS\ prescrl\)f ftgubtionl making \\
unlawful for • cable ot'l't8tor, orl Olle!lile
programming ~nd<l< la w~lcll a ~able ol'!!,1I!)f lw
on oItribulB.!* Interw. !I) Mglge In unfail meIlt«!t
(If (omt'l'li!"",. <It 001* or decepli't M:!S 01
I'!M\lctt, \he pu<pCM (l< ~ffect of wll~lI is ~
binder Of pt~( ."y multic:llannel ",6oa
)lft>gr.mll\i~ di$!fl'bulor from plO"ldlnt
programlllina IG ""b~'$.
j
The FCC m>m ~1\ce a rolernaking 10 Irnpone.
on providers of DBS 5trVice, pulllk We~( or
oth« rt"l<'~t! (lr pro-Win" ~;~eo
P"'Ilrtmrn,ng, iM!ooin&, ~mOf1g OlMt Ill,,,,., a
requiremem !hal DBS providers ,~ cl>.mnet
capacily for ~roial pro&'Ilmmi"J. of lin
i>du<atill!l!l tlr llIfarlllltiotlal naMe.
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IV.
v.
Wlthl .. 279 Days of EMttm .....
DyJu)y1, 1m
A. The FCC mutt _plm: w. IU~ 10
~ .... wIIeIher bro~ telft"IJiIlo, IIalIou lhaI
aM ~llWllly wilted for IU !n=bslon 01
~ pmeMatlom ~ plOSBIR !Melli oomll\elCillls
$ ,.m"a !he public intemI, __ 1= and
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B. The FCC mutt prescribe. "",.siQl\s !o it! 1lE0 rules.
Wlthm Ou YIM of En.dmtlrt of S. n-
Ily (klol:l!!r S, 1993 6
A. The FCC mUll esllblWl N~ Qla( n;quire u.!>le
~rs 10. Iile, wl\hin = 'fW alltr tl>e dale of
~ment of S. 12 and annuolly 1hereaIlel,
financial informatlon mat roar l>c <1«""'" .. ecessat)'
for enfon:illg Ilw FCC's rm l"ltulatloM.
B. The FCC musl CMdI!Cl • prooeedina \0 prw:ri~
rules and regufnionl w,at,1itl>.ing \il1\iu on: tl} 1M
"umber of cable .ubt~ .. peuon \$ IlIIMritbil
\l) !UCh Ihl'Olllll .:able $~ <!Wiled 1>y s-ell
pcmn; tnd (2} 1M ~ of cl1annels on I Qb!e
l)'lItm \hal canl>c oe.cupied by \>ideo plQgl1Jll~ m which a cable OpeWilf baf III ««ribd,)
"\teres!. 1'M FCC must =iiler the =.uily cl
impo5ing timlt4tiaM "'" u.c <legree \(> whlI:h
multiehannel video pqr,mm;ng dillribut.on ltIllY
(;1p&e in lhe treallw w produttiolt of video
programml~,
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C. The FCC musl .. ",bUsh regulallon, governing
program carrilge agrcemenlS and relaled r I8Clice,
between cable IJIIeClton and vld«) proenmmers.
O. Tho FCC must presenile regulations which os13bllsh
minimum lechnical 'lIndll'ds ",laUng 10 eable
systems' technical operation and signal quality.
E. The PCC musl report 10 Congress on means of
.. ,uring compatibility between lelovision., video
ca.selte recorders and cable syslem,. Wilhin ISO
days after the date M submission of the report 10
Congres., the Commission muslls,ue "&Ulalions as
are necessary 10 lS.ure .uch compatibilily.
F. The FCC must submit by luly I, 1993, an interim
report on the migration of sports programming from
broadcasl Slations to cable programming networks
and pay-per-view systems. The final report is due
onJuly 1,1994.
About the Authors ••.
This summary was p~:ued for NATOA by· Norman M. Sinel,
Palriclt 1. Grant, Sltphanie M. PhlUipps Ilid WUIIIl!\ B. Cook,lr.
MesstS. Sine! and Grant and Ms. Phillipps an! partners, and Mr.
Cook is an assoclale, at the Washlnglt'n, D.C. law linn of Arnold
&. Porter. The authors would be hipPY 10 an!w", any inquiries
regarding S. 12. Th •• uthors tan be reached It 202/Sn-6700 or
by wrilin, 10 them a, Arnold &. Porter> 12.00 New Hampsllife
A venue, NW, Washington, DC 20036.
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FCC CUSTOMER SER\1CE STANDARDS
Effective luly 1, 1993, a cable operator srwI be subject to t~ foUowmg Cl.!stomer service _:
(l) Cable sySlem offiu hours and telephone availability -
(Al The cable operator will maintain. local, toll-fn:e or collect call telepbone access line
which will be available 10 its subscnbers 24 bours • clay., seven clay •• week
(1) Trained company representati"'" will be a\'ailable to respond to cu. "ner
telephone inquiries during normal oosiness hou,.,.
(2) After normal ""'iRess bours, the access line may be answen:d by • service or
an automated response system including an answering machi~e. Inquiries
~ed after normal business hours mu" be responded to by • training
company represeDtative 00 the next oosiness day.
(B) U"ndec nonna! opetatiog conditions, telephone answer time by • customer
tqneseutative J including wait time, shall not exceed thirty (30) seconds when the
connectioo is made. U the call =ods '0 be transferred, transfer time shall not exceed
thirty (30) seconds, These standanls shall be mel 00 less !han ninety (90) percent of
the time under nonnaI operating conditions, measured on • qoarterly basis.
(C) The operator will DOl be required to acquire equipment Of' peITonn surveys to measure
compliance with the telephone answering SIaDdanls above unless an bistoricaI reconI
of <:ompJaints indicates a clear failure to comply.
(D) Under nonna! operating conditions, the customer will receive a busy sigoailess than
three (3) percent of the time.
(E) Customer service center and bill payment locations ,,'ill be open at IeaSI during normal
business hoors and will be conveniently located,
(II) InstaIIation.s, OUIa!:es and service calls -Undec normal operating conditions, each of the
follOWing four standards will be met not less than ninety five (95) percent of the time
measu."Od 00 • quarterly basis:
(A) Standard installations will be perfollDed within seven (7) busines:, days after an onIer
has been placed. "Standard" inSlallaoan, are those that are located up to 125 feel
from the existing dimibution system.
(B) Excluding conditio .. beyond the COIltrol of tbe operator, the cable operator will begin
worldng on "service intenuptions" promptly and in no event later than 24 hours after
, . . ;:,:.'.
(C)
the interruption becomes Jr..nown. The cable operator must begin actiO"S to CCrf'\:)Ct
other servt:e problems the next business day after DOdf'icauon of the service probJere.
The "appointment wi:ldow~ alternatives for inS!allations. scrv~ calls, and other
installation activities will be either a specifIc time or, at maxUnum, a four-hooT time
block during nonnal business hou". (The openuor m.ty schedule service can. and
ot.ber installation activities outside of normal business houn for the cxpre.ss
COtIvcnience of the customer.)
(D) An opetaIDr lJl3y not cancel an appointment with • cu",""er after the close of
business on the ""sines, day prior to the scheduled appointment.
(E) If. cable opetaIDr representative is running late for an appointment with a customer
and will not be able to ke<9 the appointment as scheduled, the customer will be
contacted. The appointment will be rescheduled, ., necessary, at a time which is
convenient for the customer.
(III) Communications ~een cable operators and cable subs.,.."bers -
(Al Notifications to subscnrers -
(I) The cable oper'"'' shall provide wri"en Jnformation on each of the foHowing
........ at the time of instaIIa!ion of ~, at 1= aruwaIIy 10 all subscriber>,
and at any time upotI request:
(a) products and services offi:red;
(b) prices and options for programming services and coodirions of subscription
to programming and other services;
(e) installiWon and service maintenance JIOlicles;
(d) instructions on bow to use the oable ..,...'ice:
(el cbannel positions of programming carried on the system; and
(I) billing and complaint procedures, including the address and telephone
nomber of the local franchise authority's cable office.
(1) Customers will be notifled of any changes in rates) programming services or
channel JIOsitioos as soon as possible tbro<lgb announcements on the cable
system and in writing. Notice must be given 10 subscn'bers a minimum of
thirty (30) days in advance of such cbanges if the change is within the control
of the coble operator. In addition, the cable openuor shall octify subscn"bers-
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tIlirty (3OJ days in advance\ of allY sigoiflc.1llt change, in the other information
required by the preceding pamgrnph.
(BJ Billing-
(iJ Bills will be clear, cond", and uG<lcrstandable. Bills must be foUy itemized,
with itemizatior.s including, bu~ not limited to, basic and premium service
charges and equipment cbarges. Bills will also clearly deiln<atc aU activity
dnriog tbe billing period, including optional charges, rebates and credits.
(2) In case of billing di'pules, the cable opetlllor must respond to a written
complaint from • suhscn1>er within thirty (30) days.
(C) Refunds -JIe1\u>d cbecks will be i<SUed promptly, but no later than either -
(I) the customer's next billing cycle following resolution of the request or thirty
(30) days, whichever is earlier, or
(2) the return of the equipment supplied by the Qlbte operator if service is
terminated.
(0) Credit.! -Credit.! for service will be issued no later than the cusromer's next billing
cycle following the detmnination that • credit is warranted.
(IV) Definitions-
(A) Nonnal I!u.sine3s Boo" -The tmn "nonnaJ business boom" means _ boom duri.ag
which most similar businesses in the community are open to serve customen. In aD
caseo, "oormaJ business boors" must incltlde some evening hours at least one night per
week and/or scm. weelrend hours.
(B) Nonnal Operating Conditions -the term "!lOnnal cperating ccnditions" means those
service .;ondjtions which are within the control of the cable operator. Those
conditions which are.!!!l! within the control of the cable operator include, but are DOl
limited to, natwal disasters, civiJ disturbanceS, power outages, telepbooe DC(wori<
outages, and severe or unusual weather conditions. Those conditioos which ill<
ordinarily within the CODtrol of the cable opetlllor include, but are DOl limited 10,
opecial promotions pay-per-yjew events, rate increases, regular peak or S<3SOllaI
demand periods, and maintenance or upgrade of the cable sYslem.
(C) Service lnteITUption -The tenn "service interruption" means the loss of pictllre or
sound on ODe or mon: cable channels.
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