§ 5.5-36. Rates for the basic service tier  


Latest version.
  • (a) Basic service tier rates. Basic service tier rates are subject to regulation by the city in order to assure that they are in compliance with the requirements of 47 U.S.C. §543. Rates that are demonstrated, in accordance with this article, not to exceed the "initial permitted per channel charge" or the "subsequent permitted per channel charge" as described below, or the equipment charges as specified in section 5.5-37, will be accepted as in compliance. The maximum monthly charge per subscriber for the basis service tier offered by a cable operator shall consist of a permitted per channel charge multiplied by the number of channels on the tier, plus a charge multiplied by the number of channels on the tier, plus a charge for franchise fees. The maximum monthly charges for the basic service tier shall not include any charges for equipment or installations. Charges for equipment and installations are to be calculated separately pursuant to section 5.5-37 of this article.

    (b) Initial permitted per channel charge.

    (1) For purposes of this section, the initial date of regulation for the basic service tier shall be the date on which the city gives written notice to be cable operator that:

    a. The city has been certified by the commission to regulate rates for the basic service tier; and

    b. This article has been adopted by the city.

    (2) For purposes of this section, rates "in effect on the initial date of regulation" or "in effect on September 30, 1992," shall be the rates charged to subscribers for service received on that respective date.

    (3) The permitted per channel charge on the initial date of regulation shall be, at the election of the cable operator, either:

    a. A charge determined pursuant to a cost-of-service proceeding; or

    b. The charge specified in subparagraphs (1.), (2.), or (3.) of this paragraph, as applicable;

    1. If the operator's per channel charge for the basic service tier and equipment in effect on the date of initial regulation is equal to or below the benchmark per channel charge, as adjusted forward for inflation from September 30, 1992, to the date of initial regulation, then the permitted per channel charge shall be the per channel charge in effect on the date of initial regulation, adjusted for equipment.

    2. If:

    i. The operator's per channel charge for the basic service tier and equipment in effect on the date of initial regulation is above the benchmark per channel charge, as adjusted forward for inflation from September 30, 1992, until the initial date of regulation; and

    ii. The operators' per channel charge for the basic service tier and equipment in effect on September 30, 1992, was above the benchmark per channel charge;

    Then the permitted per channel charge is nine-tenths of the per channel charge in effect on September 30, 1992, but no lower than the benchmark per channel charge, additionally adjusted for inflation from September 30, 1992, to the initial date of regulation, for equipment, and for any changes in the number of channels offered on the basic service tiers.

    3. If:

    i. The operator's per channel charge for the basic service tier and equipment in effect on the date of initial regulation is above the benchmark per channel charge as adjusted forward for inflation from September 30, 1992, until the initial date of regulation; and

    ii. The operator's per channel charge for the basic service tier and equipment in effect on September 30, 1992, was below the benchmark per channel charge;

    Then the permitted per channel charge is the benchmark rate per channel adjusted for inflation from September 30, 1992, to the initial date of regulation, for equipment, and for any changes in the number of channels offered on the basic service tier.

    (c) Subsequent permitted per channel charge. After the initial date of regulation, the permitted channel charge for the basic service tier shall be, at the election of the cable operator, either:

    (1) A per channel rate determined pursuant to a cost-of-service showing; or:

    (2) The prior permitted per channel charge previously approved by the city, adjusted for inflation and external costs in accordance with the price cap requirements set forth in paragraph (d) of this section.

    (d) Price cap requirements.

    (1) Inflation adjustments. Permitted per channel charges for the basic service tier may be adjusted periodically on account of inflation. Adjustments to permitted per channel charges on account of inflation shall be based on changes in the Gross National Product Price Index ("GNP-PI") published by the Bureau of Economic Analysis of the United States Department of Commerce.

    (2) External costs. Permitted per channel charges for the basis service tier may also be adjusted for changes in external costs measured on a per channel per subscriber basis. To the extent external costs increases are greater or less than the GNP-PI for the relevant period, the per channel charge will be adjusted accordingly. Per channel charges may not be increased if external costs other than franchise fees increase at a rate less than inflation. Permitted per channel charges also shall be decreased on account of external costs to the extent such costs decrease from previous levels.

    a. Categories. External costs shall consist of costs in the following categories:

    1. State and local taxes applicable to provision of cable television service;

    2. Franchise fees;

    3. Costs of complying with franchise requirements, including costs of providing public, educational, and governmental access channels as required by the city;

    4. Retransmission consent fees; and

    5. Programming costs.

    b. The permitted per channel charge for the basic service tier shall be adjusted on account of programming costs and retransmission consent fees only for programming or broadcast signals offered on that tier.

    c. The permitted per channel charge shall not be adjusted for costs of retransmission consent fees or charges in those fees incurred prior to October 6, 1994.

    d. The starting date for adjustments on account of external costs for the basic service tier shall be the initial date of regulation or one hundred eighty (180) days from September 1, 1993, if the initial date of regulation occurs on or after one hundred eighty (180) days from September 1, 1993.

    e. Changes in franchise fees shall not result in an adjustment to permitted per channel charges, but rather shall be calculated separately as part of the maximum monthly charge per subscriber for the basic service tier.

    f. Adjustments to permitted per channel charges on account of increases in costs of programming obtained from affiliated programmers shall be the lesser of actual increases or the previous permitted rate level increased by the amount of inflation.

    g. Adjustments to permitted per channel charges on account of increases in costs of programming shall be further adjusted to reflect any revenues received by the operator from the programmer.

(Ord. No. 9317, § 6, 10-11-92)