Agenda - 05-03-2005-5j - Laserfiche WebLink

Browse Search

is -9- FCC Form 1235 Cable System Upgrade Costs In 1999, TWC submitted a form 12.35 Cost of Service (COS) for the Cable Network Upgrade to justify the $1.81 fee for NC-0276a, $2.11 for NC-0276b, and $1..45 for NC-0256 that is added to the BST MPR, the BST Cost of Service rates.'' FCC rules permit cable operators to recover system bandwidth upgrade capital investments for fiber optic cable and related equipment by distributing the costs among the cable tiers, e.g,, BST, cable program service tier (CPST), new product tiers (NPT), Other Services, etc. The FCC's rules allowed the original allocation'4 to be calculated by program service tier: Under this scheme, a 20-channel BST group would occupy 120 MHz of bandwidth, a 35-channel CPST group would occupy 210 MHz of bandwidth and so forth. The original allocation convention did anticipate other uses for the cable spectnnn.ts A fundamental principle of the FCC's rate regulation rules is to ensure that the rates far regulated services do not include the costs attributed to unregulated services. For example, under the abbreviated Cost of Service rules for system upgrades, cable operators aze required to comply with four conditions before they can chazge an additional fee for capital improvements. One such condition is that the operator must comply with the FCC's cost allocation rules which bar of allocation of costs of unregulated service to regulated services. This principle is particularly obvious in the Commission's Cost of Service Report and Orders as indicated below,. 13 May 3Q 2003:FCC Form 1235 Cost of Service Filing for Cable Network Upgrades, 14 Form FCC1235 dated October 1, 200.3.. ~SSee FCC Rule §76.924 Allocation to service cost categories (e) Allocation to service cost categories (1) For cable operators electing cost-of-service regulation, investments, expenses, and revenues contained in the summary accounts identified in pazagraph (d) of this section shall be allocated among the Equipment Basket, as specified in §76,923, and the following service cost categories: (I) Basic service cost category. The basic service category, shall include the cost of providing basic service as defined by §76,901(a) The basic service cost category may only include allowable costs as defined by §§76.922(8) through 76 922(k). (ii) Cable programming services cost category. The cable progranuning services category shall include the cost of providing cab]e programming services as defined by §76.901(b). This service cost category shall contain subcategories that represent each programming tier that is offered as a part of the operator's cable programming services. All costs that are allocated to the cable programming service cost category shall be further allocated among the programming tiers in this category. The cable programming service cost category may include only allowable costs as defined in §76.922(8) through 76.922(k) (iii) Alt other services cost category The all other services cost category shall include the costs ofproviding all other services that are not included the basic service or a cable progranuning services cost categories as defined in paragraphs (e)(1)(I) and (ii) of this section