2 DA 20-1159 MEDIA BUREAU ACTION October 2, 2020 INFLATION ADJUSTMENT FIGURES FOR CABLE OPERATORS USING FCC RATE REGULATION FORMS 1210 AND 1240 NOW AVAILABLE This Public Notice is applicable to rate-regulated cable operators that use FCC Forms to justify their cable rates. Pursuant to 47 CFR § 76.922(d)(2) and § 76.922(e)(2) of the Commission’s rules, cable operators may adjust the non-external cost portion of their rates for inflation. Cable operators adjusting the non-external cost portion of their rates for inflation should follow the instructions provided with the applicable FCC Form. All inflation adjustment figures are based on changes in the Gross National Product Price Index (GNP-PI) published by the United States Department of Commerce, Bureau of Economic Analysis (BEA). The Media Bureau obtained the chain-type price indexes from the BEA news release dated September 30, 2020 (BEA 20-48) at Table 1.7.4 (Price Indexes for Gross Domestic Product, Gross National Product, and Net National Product) Line 4 (Gross National Product). Table 1.7.4 can be found at this link: https://apps.bea.gov/iTable/iTable.cfm?reqid=19&step=2#reqid=19&step=2&isuri=1&1921=survey FCC Form 1210 Operators filing FCC Form 1210 may make an annual adjustment based on inflation occurring from June 30 of the previous year to June 30 of the year in which the inflation adjustment is made. The inflation factor for the twelve months ended June 30, 2020 is 1.0060. Operators who wish to take this year’s inflation adjustment using FCC Form 1210 should enter the figure “1.006” on Lines I5 and J5 of the form. This year’s inflation adjustment factor is calculated by dividing the second quarter 2020 GNP-PI (112.822) by the second quarter 2019 GNP-PI (112.412). Operators may take this year’s inflation adjustment between October 1, 2020 and August 31, 2021. FCC Form 1240 Operators filing FCC Form 1240 may make an adjustment based on quarterly figures. The second quarter 2020 inflation factor for operators using FCC Form 1240 is -1.82%. The negative adjustment factor of -1.82% is a measure of the annualized change in prices occurring over the period from April 1, 2020 to June 30, 2020. The inflation adjustment factor is calculated by dividing the GNP-PI for the second quarter of 2020 (112.822) by the GNP-PI for the first quarter of 2020 (113.341). The result of this calculation is converted from a quarterly change measurement factor to an annual change measurement factor by raising it to the fourth power. We then convert the calculation to an inflation adjustment factor by subtracting one. Operators calculating the Inflation Factor for a True-Up Period that includes some portion of the second quarter of 2020 should enter the negative inflation factor on the appropriate lines of Worksheet 1 of FCC Form 1240 as “-0.0182.” Operators using this factor for calculating the Projected Period Inflation Segment of FCC Form 1240 should enter this number on Line C3 (January 1996 version), or Line C5 (July 1996 version) as “0.9818” (1 plus -0.0182 = 0.9818). To date, the Commission has released ninety-six quarterly inflation factors for use with FCC Form 1240. The following table lists these factors beginning in 2017. For pre-2017 inflation figures see DA 17-646, 32 FCC Rcd 5479 (rel. July 5, 2017), available at https://www.fcc.gov/general/inflation-updates-forms-1210-and-1240. Year Quarter Dates Covered Inflation Factor 2017 First Jan. 1, 2017 – Mar. 31, 2017 1.96% 2017 Second Apr. 1, 2017 – Jun. 30, 2017 1.01% 2017 Third Jul. 1, 2017 – Sep. 30, 2017 2.09% 2017 Fourth Oct. 1, 2017 – Dec. 31, 2017 2.33% 2018 First Jan. 1, 2018 – Mar. 31, 2018 2.20% 2018 Second Apr. 1, 2018 – Jun. 30, 2018 3.04% 2018 Third Jul. 1, 2018 – Sep. 30, 2018 1.81% 2018 Fourth Oct. 1, 2018 – Dec. 31, 2018 1.68% 2019 First Jan. 1, 2019 – Mar. 31, 2019 0.90% 2019 Second Apr. 1, 2019 – Jun. 30, 2019 2.42% 2019 Third Jul. 1, 2019 – Sep. 30, 2019 1.81% 2019 Fourth Oct. 1, 2019 – Dec. 31, 2019 1.28% 2020 First Jan. 1, 2020 – Mar. 31, 2020 1.41% 2020 Second Apr. 1, 2020 – Jun. 30, 2020 -1.82% The Commission releases a new quarterly inflation factor for operators using FCC Form 1240 four times each year. The inflation factor for a given quarter is usually released between three and four months after the end of the quarter, depending on the schedule of the Department of Commerce. The release of a new factor is posted on the Commission’s Internet site at: https://www.fcc.gov/general/inflation-updates-forms-1210-and-1240. Media Contact: Janice Wise at (202) 418-8165 Media Bureau Contact: Kevin Green at (202) 418-2127 TTY: (202) 418-0432 or 1 (888) 835-5322 --FCC--