Federal Communications Commission DA 07-1266
Before the
Federal Communications Commission
Washington, D.C. 20554
In the Matter of 
NCTA  Request for Clarification of Franchise Fee 
Policy
)
)
)
)
)
)
CSR-5147-R
ORDER
Adopted:  March 12, 2007 Released:  March 13, 2007
By the Chief, Media Bureau:
1. In a Petition filed April 1, 1998, the National League of Cities; National Association of 
Telecommunications Officers and Advisors; the Cities of Ann Arbor, Michigan; Indianapolis, Indiana; 
Laredo Texas; St. Louis, Missouri; and Tallahassee, Florida; Hillsborough County, Florida; and the 
Southwestern Oakland County Cable Commission (“Petitioners”) sought clarification and reconsideration 
of an order1 issued by the Cable Services Bureau on March 2, 1998 in which the Bureau ruled that cable 
operators may pass through to their subscribers any franchise fee charges requested of cable operators by 
their local franchising authorities as a result of the recalculation of franchise fees pursuant to the Fifth 
Circuit Court of Appeals’ decision in Dallas v. FCC (“Dallas”).2 In this Order, we dismiss the Petition 
on the grounds that the requested reconsideration is beyond the scope of the Bureau order.
2. We note that the recalculation of franchise fees pursuant to Dallas was a one-time event 
that occurred nine years ago.  The Petition was submitted following the ruling of the Bureau on a previous 
petition filed by the National Cable Television Association (“NCTA”) regarding the appropriate 
regulatory treatment of local franchise fee payments as a result of the Dallas decision, which reversed the 
Commission’s decision in United Cable Artists.3 In its petition, NCTA requested clarification of whether 
cable operators that relied on United Cable Artists and excluded franchise fee payments from the gross 
revenues pool upon which their franchise fees were calculated, may pass through to subscribers increases
in their franchise fee payments that they were required to make to compensate for previous 
underpayments pursuant to the 5th Circuit’s ruling in Dallas.4 The Bureau ruled that cable operators may 
do so.
3. Petitioners seek clarification regarding what it means to “properly follow” United Cable 
Artists. The Bureau, in its ordering clause, limited application of the order to cable operators that 
“properly followed” United Cable Artists by calculating lower franchise fees pursuant to that Commission 
decision.  Petitioners also seek clarification that franchise authorities can require, not simply request, 
  
1 In re Franchise Fee “Pass Through” and Dallas v FCC, 13 FCC Rcd 4566 (1998).
2 Dallas v. FCC, 118 F.3d 393 (5th Cir. 1997) reversing United Artists Cable, 11 FCC Rcd 18158 (1995).
3 United Cable Artists, 11 FCC Rcd 18158.
4 See 47 U.S.C. § 542 (“franchise fees paid by a cable operator ... shall not exceed 5 percent of such cable operator’s 
gross revenues derived ... from the operation of the cable system.”).
Federal Communications Commission DA 07-1266 
2
cable operators to pay the difference in franchise fees resulting from the higher calculations. Finally, 
Petitioners seek reconsideration of the Bureau’s determination that cable operators can recover from 
subscribers the difference in franchise fees, arguing that the Bureau order conflicts with Dallas. 
4. The Bureau order fully addressed the issue raised by NCTA in its petition.  NCTA 
requested clarification on whether cable operators that relied on United Cable Artists may pass through 
charges subsequently paid to franchise authorities pursuant to Dallas. The Bureau order concluded they 
could. In doing so, the Bureau order did not discuss the details of that calculation or other alleged “pass 
throughs,” and concluded merely that operators that followed the dictates of United Cable Artists may 
pass through subsequently the changes in franchise fee charges resulting from recalculations pursuant to 
Dallas.  With respect to whether franchise authorities may require or merely request cable operators to 
pay the difference, the Bureau order restated the issue raised by NCTA as whether cable operators may 
pass through payments they were required to make for underpayments made during the period United 
Cable Artists was in effect.  The Bureau concluded that they may do so.  Finally, the Bureau order in no 
way was inconsistent with Dallas, which did not address recovery of franchise fees by cable operators as 
raised in the NCTA petition.
5. Accordingly, IT IS ORDERED that the Petition for Clarification and Reconsideration of 
National League of Cities; National Association of Telecommunications Officers and Advisors; the Cities 
of Ann Arbor, Michigan; Indianapolis, Indiana; Laredo, Texas; St. Louis, Missouri; and Tallahassee, 
Florida; Hillsborough County, Florida; and the Southwestern Oakland County Cable Commission IS 
DISMISSED.  
6. This action is taken pursuant to authority delegated by § 0.283 of the Commission’s 
rules.5
FEDERAL COMMUNICATIONS COMMISSION
Monica Shah Desai
Chief, Media Bureau
  
5 47 C.F.R. § 0.283.