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STATE OF NORTH CAROLINA <br /> COUNTY OF HILLSBOROUGH <br /> BEFORE THE BOARD OF COMMISSIONERS OF ORANGE COUNTY <br /> IN THE MATTER OF: ) Order Finding TWC's 1998 <br /> Review of FCC 1240 Annual Basic ) Proposed$9.04 and $8.20 Basic <br /> Service Tier Rate Adjustment Request ) Service Tier Maximum Permitted <br /> filed by Time Warner Cable for ) Rates as Unreasonable and Setting <br /> Orange County, NC-0256 & NC- ) the BST MPRs at$8.84 and $8.02 for <br /> 0276. ) the Carrboro and Chapel Hill Cable <br /> Television Systems <br /> BY THE BOARD OF COMMISSIONERS <br /> WHEREAS, on October 1, 1997, Time Warner Cable submitted two FCC 1240 Annual <br /> Maximum Permitted Rate filing requests for Regulated Cable Services with Orange County, one for <br /> the Chapel Hill system, the other for the Durham system. Both filings cover external costs, inflation, <br /> and cable system upgrade costs for the projected period of January 1 through December 31, 1998; and <br /> above stated costs for the true up period of January 1 through December 31, 1997; <br /> WHEREAS, Time Warner Cable is permitted,pursuant to the Social Contract,to estimate and <br /> recover anticipated inflation, external costs, and cable system upgrade costs for the period of January <br /> through December 31, 1998; <br /> WHEREAS, the County received a report from its consultants stating that Time Warner's FCC <br /> 1240 rate calculations are not in compliance with Federal Communications Commission rate making <br /> rules, and that the proposed maximum permitted BST rates of$9.04 for the Carrboro System <br /> subscribers (NC-0256) and$8.20 for Chapel Hill System subscribers (NC-0276) are unreasonable. <br /> WHEREAS, FCC rules grant local franchise authorities an initial 90-day review period, <br /> measured from the date of receipt of the FCC 1240 filing by the franchise authority, to review the cable <br /> operator's rate filings. If said 90-day review period expires before the rates go into effect, the franchise <br /> authority retains review and refund authority past the initial 90-day review period as long as all <br /> inquiries from the cable operator regarding said review are responded to in writing within 15 days of <br /> said inquiry; <br /> WHEREAS, Time Warner's rate filings include cost estimates for the calendar year of 1998, <br /> and said estimates may require adjustment(true up) in the cable operator's subsequent FCC 1240 rate <br /> filings; and, <br />