Before the
FEDERAL COMMUNICATIONS COMMISSION DA 95-1246 
Washington, D.C. 20554
In the Matter of )
) MEREDITH/NEW HERITAGE STRATEGIC PARTNERS, L.P. )
 )Petitions for Review of the Local Rate Orders of )
The Burnsville/Eagan Cable Communications Commission; )
The City of Columbia Heights, Minnesota; )
The North Central Suburban Cable Communications Commission; )
The North Suburban Cable Communications Commission; and, )
The Quad Cities Cable Communications Commission )
CONSOLIDATED ORDER 
Adopted: June 6, 1995 Released: June 8, 1995
By the Chief, Cable Services Bureau: 
I. INTRODUCTION
1. In this Order, we resolve five petitions for review of five local rate orders 
filed on April 12, 1994 by Meredith/New Heritage Strategic Partners, L.P. ("Meredith"), a 
cable operator which serves several communities in the State of Minnesota. 1 The five local 
orders were issued by the Burnsville/Eagan Cable Communications Commission; the City of 
Columbia Heights, Minnesota; the North Central Suburban Communications Commission; 
the North Suburban Cable Communications Commission; and the Quad Cities Cable
1 Meredith filed its petitions for review of all five local rate orders more than 30 days 
after the local rate orders were released. Submitted with those petitions were motions to file 
the petitions late. In Orders released May 13, 1994, the Cable Services Bureau denied the 
motions of Meredith to file its petitions late. Thereafter, Meredith sought review of the 
Bureau decisions by submitting applications for review with the Commission on May 17, 
1994. On November 16, 1994, the Commission granted Meredith's applications for review. 
See Meredith/New Heritage Strategic Partners, Inc., 9 FCC Red 6841 (1994).
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Communications Commission.2 The rate orders established rates for regulated basic cable 
service provided by Meredith. Meredith also sought stays of all five of the local rate orders 
pending our review. The stay requests were unopposed, although the local franchising 
authorities had opposed Meredith's request that we accept for filing the operator's petitions 
despite the fact that they were filed late.3 The local authorities submitted oppositions to 
Meredith's petitions for review and Meredith replied to those oppositions.
2. On December 9, 1994, Meredith filed a motion to dismiss its petition for 
review of the North Suburban Communications Commission order. On December 14, 1994 
Meredith filed a motion to dismiss its petition for review of the order issued by the City of 
Columbia Heights, Minnesota. On January 24, 1995, Meredith filed a motion to dismiss its 
petition for review of the order issued by the Quad Cities Cable Communications 
Commission. We will grant those unopposed motions and, accordingly, will dismiss the 
petitions for review of those three local rate orders, as well as the corresponding petitions for 
stay. The issues presented in the remaining two appeals are identical. In the interests of 
administrative efficiency, the Bureau has decided that the two proceedings are sufficiently 
related to each other to justify the resolution of both remaining appeals in this Consolidated 
Order.4
n. BACKGROUND
2 Meredith serves numerous communities subject to the jurisdiction of the five local 
franchising authorities. The Burnsville/Eagan Cable Communications Commission entered 
an order applicable to Meredith's operations in Burnsville and Eagan, Minnesota. The City 
of Columbia Heights entered an order applicable to Meredith's operations in the cities of 
Columbia Heights and Hilltop, Minnesota. The North Central Suburban Cable 
Communications Commission entered an order applicable to Meredith's operations in the 
cities of Blaine, Centerville, Circle Pines, Coon Rapids, Ham Lake, Lexington, Lino Lakes, 
and Spring Lake Park, Minnesota. The local order issued by the North Suburban Cable 
Communications Commission was applicable to Meredith's operations in Arden Hills, Falcon 
Heights, Lauderdale, Little Canada, Mounds View, New Brighton, North Oaks, Roseville, 
St. Anthony, and Shoreview, Minnesota. The local order issued by the Quad Cities Cable 
Communication Commission was applicable to Meredith's operations in Anoka, Ramsey, 
Champlin, and Andover, Minnesota.
3 See local franchising authorities' Opposition to a Motion to Accept Pleadings Filed 
One Day Late (filed April 20, 1994). Because we are resolving two of these appeals on the 
merits and granting motions to dismiss the remaining three appeals, the petitions for stay 
have been rendered moot.
4 Because we are resolving this dispute on the merits by addressing the issues as 
presented in the remaining two petitions for review, the corresponding petitions for stay are 
rendered moot.
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3. The two local rate orders issued by the Burnsville/Eagan and North Central 
Suburban Cable Communications Commissions reduced Meredith's basic service tier rates 
and Meredith's hourly service charges. Meredith was ordered to refund to subscribers the 
overcharges collected for basic service back to September 1, 1993 and to refund to 
subscribers any overcharges for hourly service incurred since September 1, 1993. Meredith 
calculates that the total monthly rate reductions to subscribers under these two orders will be 
$2,567 and that total refunds to subscribers will amount to $17,970.5
4. Meredith seeks review of the two local rate orders with respect to three issues. 
Meredith states that the local orders violate federal law and Commission rules (1) by 
violating Meredith's due process rights through the failure of the local authorities to provide 
Meredith with copies of the Form 393 calculations made by the consultant hired by the local 
franchising authorities, upon which the local authorities based then* adjustments of Meredith's 
initial permitted rates; (2) by disallowing Meredith the full inflation adjustments permitted by 
Commission rules; and (3) by requiring Meredith to include costs and hours spent 
disconnecting subscribers from cable service in its Form 393 calculations even though 
Meredith did not bill subscribers for those activities.
5. The local authorities each respond to the three common challenges to their rate 
orders by contending that (1) all procedural requirements were complied with; (2) Meredith 
made last minute requests to correct its own inflation figures which the local authorities 
properly refused; and (3) disconnection costs are subscriber-related costs incurred by 
Meredith which should be included in its Form 393 calculations despite Meredith's decision 
not to charge for such services.
6. Under our rules, rate orders made by local franchising authorities may be 
appealed to the Commission.6 In ruling on appeals of local rate orders, the Commission will 
not conduct a de novo review, but instead will sustain the franchising authority's decision as 
long as there is a reasonable basis for that decision.7 Therefore, the Commission will 
reverse a franchising authority's decision only if it determines that the franchising authority
5 Meredith Emergency Petitions For A Stay at 3. Meredith estimates that the 
Burnsville/Eagan order will reduce rates to all subscribers by a total of $1,219 per month 
and will require Meredith to make a total payment of $8,536 plus interest as refunds. The 
North Central Suburban order will reduce rates to all subscribers by $1,348 per month and 
will require a total payment of $9,434 plus interest as refunds.
6 See 47 C.F.R. § 76.944.
7 See Report and Order and Further Notice of Proposed Rulemaking in MM Docket 92- 
266, 8 FCC Red 5631, 5731(1993) ("Repon and Order"); Third Order on Reconsideration in 
MM Docket 92-266, FCC Red 4316, 4346 (1994) ("Third Recon. Order").
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acted unreasonably in applying the Commission's rules in rendering its local rate order. 8 If 
the Commission reverses a franchising authority's decision, it will not substitute its own 
decision but instead will remand the issue to the franchising authority with instructions to 
resolve the case consistent with the Commission's decision on appeal.9
III. DISCUSSION
7. The issues raised by Meredith on appeal each involve preparation of FCC 
Form 393, which is the official form used by regulators to determine whether an operator's 
regulated rates for programming, equipment and installations were reasonable during the time 
period from September 1, 1993 until May 14, 1994. 10 Form 393 is divided into three 
separate, but interrelated parts. In Part II, the operator calculates its maximum permitted 
programming rates, while in Part in, the operator calculates its maximum permitted 
equipment and installation rates. Part I is a cover sheet that lists the various programming, 
equipment and installation rates that have been calculated in Parts II and III and compares 
them to the rates the operator has actually charged during the period of review.
8. The operator's maximum permitted rates are derived by completing Parts n 
and m of the Form 393, pursuant to which the operator calculates the actual aggregate 
revenues collected by the operator for regulated programming, equipment and installation, as 
of the initial date of regulation ("current rate") or as of September 30, 1992. n After 
calculating actual aggregate revenues, the operator converts those revenues to a per-channel 
rate, and then compares the per-channel figures to the applicable benchmark rate. If an 
operator's current per-channel rate is below the applicable benchmark rate, then the 
operator's rate level is deemed reasonable, but it must remain at its current level. If its 
current per-channel rate exceeds the benchmark rate, the operator must then compare its 
September 30, 1992 per-channel rate to the applicable benchmark rate. If its September 30, 
1992 per-channel rate is above the benchmark rate, it must reduce this rate level to the 
benchmark rate or by 10%, whichever reduction is less. After computing the permitted rate
9 Id.
10 To the extent that an operator has sought to take advantage of the refund deferral 
period available under the Second Order on Reconsideration, Fourth Report an Order, and 
Fifth Notice of Proposed Rulemaking in MM Docket 92-266, 9 FCC Red 4119, 4183-4185 
(1994), the maximum permitted rates determined under Form 393 may also apply from May 
15, 1994 until the date that the operator implemented its new rates, as determined under the 
Form 1200 series.
11 An operator must calculate its rate in effect on September 30, 1992, only if its current 
rate level is above the benchmark rate. If an operator's current rate level is at or below the 
benchmark rate, it is not required to calculate its September 30, 1992 per-channel rate.
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level in this manner (whether based on current rates or September, 1992 rates), monthly 
equipment and installation costs are removed to derive the maximum permitted programming 
rates. Maximum permitted rates for equipment and installation are based on actual cost and 
are calculated in Part in of the Form 393.
A. Procedural Requirements.
9. Meredith's first contention is that the local franchising authorities failed to 
provide Meredith with copies of the 393 Forms prepared by the consultant for each local 
authority, which were used by the authorities as the basis for recalculation of Meredith's 
permitted rates. Meredith states that, since the local franchising authorities failed to provide 
it with these computations of the consultant, Meredith has been unable to comment 
effectively on each of the local decisions. In support of its position, Meredith cites the 
Report and Order which provides that the franchising authority must give the cable operator 
notice and an opportunity to comment on rates before they are prescribed. The Report and 
Order also requires the franchising authority, in a written decision, to affirmatively 
demonstrate why the prescribed rates are reasonable. 12 Meredith believes that, by refusing to 
release the consultant's Form 393, the local franchising authorities did not so demonstrate.
10. The local authorities respond to Meredith's contention by stating first, that 
their consultant did not prepare revised 393 Forms and had no obligation to do so; and 
second, that the franchising authorities provided opportunities for comment and otherwise 
exceeded the procedural requirements of the FCC hi developing and adopting then: rate 
orders. The local authorities state that they held public meetings each month following 
submission of Meredith's 393 Forms until final action on the rate requests and that Meredith 
attended each meeting. In December, 1993, the franchising authorities, through their 
consultant, developed a preliminary report and submitted numerous questions to Meredith 
which addressed concerns which became the bases for the findings of fact contained in the 
local rate orders. The consultant also met with Meredith at this time to review the open 
issues. The final report of the consultant was released to Meredith in January, 1994, 
following which the consultant met with Meredith to review each of the issues raised in the 
report. Additional meetings with Meredith and exchanges of correspondence occurred 
subsequent to release of the report and prior to adoption of the local rate orders.
11. Our rules require that a franchising authority must provide a reasonable 
opportunity for consideration of the views of interested parties. 13 Our rules also require the 
franchising authority to issue a written report if it disallows the operator's rates. 14 The 
written report must affirmatively demonstrate why the operator's rates are unreasonable and
12 Report and Order at 5723-5724.
13 47 C.F.R. § 76.935.
14 47 C.F.R. § 76.936.
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why the prescribed rates are reasonable. 15 There is no requirement that the franchising 
authority prepare, or have a consultant prepare, a new Form 393. It is sufficient under our 
rules that the local authority consider the written views of interested persons on issues raised 
about the operator's proposed rates. 16 Plainly, the local franchising authorities have 
conducted their review of Meredith's 393 Forms in a responsible manner in compliance with 
the procedural safeguards established by the Commission. Meredith was given the required 
notice and opportunity to comment. The local authorities met with Meredith on numerous 
occasions, exchanged written correspondence on issues raised by the consultant, and gave 
Meredith at least one opportunity to review the consultant's calculations used to arrive at the 
maximum permitted rates recommended to the local authorities. 17 The rate orders also set 
forth and affirmatively demonstrate the findings of each of the local franchising authorities 
with regard to the issues that had been discussed previously. The local rate orders define 
eight to 12 issues that the authorities concluded were improperly dealt with by Meredith and 
made the necessary corrections to Meredith's 393 Forms. We conclude that, in considering 
Meredith's 393 Forms and in adopting local rate orders reflecting that consideration, both of 
the local authorities acted reasonably and met procedural requirements.
B. Inflation Adjustment.
12. Next, Meredith contends that it mistakenly inserted the wrong number in Line 
124 of each of its 393 Forms. This figure, the number of months from September 30, 1992 
to the "date [the operator] will submit this form," is used to calculate the inflation adjustment 
factor. 18 Meredith states that it incorrectly inserted the number 12 rather than 13, which has 
the effect of reducing the inflation adjustment factor and lowering Meredith's adjusted 
benchmark rate. Mr. Kevin Griffin, President and General Manager of Meredith, hi his 
affidavit, states that the local franchising authorities were informed of this error at meetings 
held prior to a public hearing held by Burnsville/Eagan as well as at the hearing itself but 
that die local authorities failed to make the necessary corrections. The local authorities argue 
that the inflation adjustment issue was not raised by Meredith until the evening of the public 
hearing held by Burnsville/Eagan on February 10, 1994. The authorities' consultant states 
that Meredith did not raise the inflation adjustment issue in any discussions, meetings, or 
correspondence he had with Meredith representatives prior to the public hearing.
13. Under the Commission's rules, cable operators have the burden of proof in
15 Report and Order at 5723-5724.
16 Report and Order at 5724, n. 367.
17 Affidavit of Kenneth J. Muellerleile at 2, attached as Exhibit 1 to local franchising 
authorities' Opposition to Petition for Review of Rate Order.
18 FCC Form 393, Determination of Maximum Initial Permitted Rates For Regulated 
Cable Programming Services and Equipment, Worksheet 1.
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demonstrating the reasonableness of existing or proposed rates for their basic service tier and 
associated equipment. 19 Determining whether this burden of proof has been met depends on 
accurate self-reporting by cable operators. It was Meredith's responsibility to raise the issue 
and point out to the local franchising authorities that the Line 124 figure was wrong. This 
Meredith did at the public hearing held by Bumsville/Eagan on February 10, 1994 for the 
stated purpose of gathering information from interested persons. While the local franchising 
authorities dispute that Meredith raised the Line 124 issue prior to the public hearing, they 
do not dispute the fact that Meredith did raise the issue at the public hearing. Nor do they 
dispute the accuracy of the correction.
14. Meredith advised both Commissions at the February 10, 1994 public hearing 
that it had inserted the incorrect number in Line 124 and that the correct figure for the 
number of months that had elapsed from September 30, 1992 to mid-November, 1993 was 
13, not 12.20 While that hearing was held by the Burnsville/Eagan Commission, the 
consultant for Burnsville/Eagan, who was in attendance at that hearing, was also the 
consultant for North Central Suburban, and was advised of the error at that time. 
Considerable coordination existed between the two franchising authorities. The consultant, in 
his affidavit attached to the Response of North Central Suburban, stated that this was the first 
time the consultant recalled Meredith ever mentioning the Line 124 figure.21 However, the 
point is that Meredith raised the issue with Burnsville/Eagan at least at the time of the public 
hearing on February 10, 1993 and with the representative for North Central Suburban at that 
time as well. Each of the local rate orders describe the public hearing held by 
Burnsville/Eagan on February 10, 1994, and the public hearing held shortly thereafter by 
North Central Suburban on February 16, 1994, as conducted "to ensure that all interested 
parties had ample opportunity to present information to the Commission. n22 This is just what 
Meredith did by raising the inflation calculation issue at this time. Burnsville/Eagan 
approved its rate order that night but subsequently amended it on March 9, 1994. North 
Central Suburban adopted its rate order on February 16, 1994. The local authorities should 
have amended Meredith's Form 393s or requested amended Forms, to reflect the change, 
since it was raised during, and arguably prior to, the public hearing called by 
Burnsville/Eagan to hear interested parties and to gather information. For us to hold 
otherwise would promote expediency over accuracy. The local authorities' rejection of the 
correction was unreasonable.
19 47 C.F.R. § 76.937.
20 See FCC Form 393, Instructions to Worksheet 1.
21 Affidavit of Kenneth J. Muellerleile at 3.
22 See Resolution of North Central Suburban Cable Communications Commission, 
attached as Exhibit 1 to Meredith's Petition for Review of the North Central Suburban rate 
order, and Resolution of Burnsville/Eagan Cable Communication Commission, attached as 
Exhibit 1 of Meredith's Petition for Review of the Burnsville/Eagan rate order.
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C. Costs of Disconnections.
15. Meredith states that it excluded both the costs and hours associated with its 
disconnection-of-service activities from the equipment calculations in its 393 Forms and that 
the decisions of the local franchising authorities to include such costs are improper. 
Meredith alleges that the local authorities recomputed the equipment calculations with 
disconnection-related costs and hours included on the theory that disconnections are a form of 
service tier change, which is specifically identified in the 1992 Cable Act as an activity 
subject to cost-based rate regulation.23 Meredith states that it did not include disconnection 
activities, either costs or hours, in its equipment costs because it does not bill subscribers for 
the disconnection of service. It considers the costs incurred from disconnection activities to 
be general operating costs. Meredith argues that disconnection costs have never been 
specified by the Commission as costs to be included in the equipment basket. Finally, 
Meredith states that even if such costs are properly included in the equipment basket, the 
local authorities erred by including costs that were incurred beyond the demarcation point of 
customer premises.24
16. The local franchising authorities reply that Meredith bases its argument, that 
disconnection costs should not be included in the equipment basket, on grounds that it does 
not charge subscribers for disconnections. The local authorities state that the fact that an 
operator does not collect revenue on certain equipment and installations does not change the 
fact that costs are incurred relative to that equipment and those installations. The local 
authorities cite an attachment to a public notice issued by the Commission as further proof 
that disconnection costs are considered by the Commission to be costs that should be 
included in the equipment basket.25 The attachments to the public notice, which are offered 
as guides to Form 393 equipment calculations, include disconnections under the category 
"Equipment Fees."26
17. Part m of Form 393 is used to calculate equipment and installation charges 
and to determine monthly equipment and installation costs. Permitted equipment and 
installation charges are based on actual equipment and installation costs. Monthly equipment 
and installation costs are used in calculating the operator's maximum permitted programming
23 See Communications Act, § 623(b)(5)(C), 47 U.S.C. § 543(b)(5)(C).
24 For single unit installations the demarcation point is defined as the point "twelve 
inches outside of where the cable wire enters the outside wall of the subscriber's premises.' 
Report and Order, n. 666.
25 See Public Notice, Questions and Answers on Cable Rate Regulation, Attachments 
(rel. May 13, 1993).
26 Id.
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rate.27 The equipment and installation costs are subtracted from regulated revenues in 
Worksheet 3. The addition of costs to Part III of Form 393, such as disconnection costs for 
example, without corresponding additions in revenues, has the effect of lowering the 
operator's maximum permitted programming rate. This is the source of Meredith's 
complaint.
18. The elements of cost included or excluded in Form 393 calculations are not 
based on whether subscribers are billed to cover such costs. Our rule that defines the 
"equipment basket" states that the basket shall include all "direct and indirect material and 
labor costs of providing, leasing, installing, repairing, and servicing customer equipment."28 
The rule explicitly excludes general administrative overhead and general marketing 
expenses.29 While the rule does not identify costs related to disconnection activities as a part 
of the equipment basket specifically, it is not unreasonable to consider such activities within 
the category of "servicing customer equipment." They are so referenced hi Form 393.30 
Specifically, revenue from disconnection activities is identified in Form 393 as revenue from 
equipment services which should be included in the revenue computations of the form.31 If 
an operator does not bill subscribers for such activities, as Meredith states is the case here, 
obviously no revenue will entered. But that does not change the characterization of 
disconnection activities as "equipment services." If a category of revenues, such as those 
from disconnection activities, is properly includable on the revenue side of Form 393, 
corresponding costs, such as those incurred from those same disconnection activities, should 
be included on the cost side. We therefore find that it is reasonable for a local franchising 
authority to conclude that operators must include the costs of disconnection activities in the 
equipment basket.
27 See Form 393, Line 301 (Equipment and Installation Cost) and related portions of 
Form 393. Line 301 is derived from Part ffl, Step G (Equipment and Installation Costs for 
Adjustment of Regulated Service), which is derived from the total of Step A, Line 3 
(Customer Maintenance and Installation Costs) and Box 3 of Schedule C (Capital Costs of 
Leased Customer Equipment). Line 3 is based on Schedules A & B (Capital Costs and 
Operating Expenses for Service Installation and Maintenance of Equipment).
28 47 C.F.R. § 76.923.
29 Id
30 See Form 393, Instructions for Worksheet 1, Line 104 and Worksheet 2, Line 204. 
The instructions for Line 104, for example, state that "to calculate...average equipment 
revenue, [the operator should] take the revenues...earned...for the following equipment and 
installation services: ...(4) installation fees; (5) disconnect fees; (6) reconnect fees; and (7) 
tier changing fees." (Emphasis added.)
31 Id.
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19. However, if disconnection costs are included in equipment basket 
computations, local authorities must permit operators to recover those costs from equipment, 
installation or disconnection charges. Here, the local franchising authorities do not permit 
Meredith to bill subscribers for such activities. 32 This prohibition does not allow Meredith to 
establish rates that reflect actual costs. It is inconsistent with the actual cost standard 
required for equipment and installation rates under the 1992 Cable Act.33 Accordingly, we 
are remanding this issue to each of the local franchising authorities for handling consistent 
with this Order.
20. Meredith also states that even if disconnection costs are properly included in 
the equipment basket, only those costs incurred inside the demarcation point should be 
added. Meredith alleges that the local authorities have added disconnection costs incurred 
from the subscriber drop to the demarcation point to Meredith's equipment costs.34 The local 
franchising authorities do not respond to this specific point other than to state that the 
disconnection issue was fully aired between Meredith and the authorities' consultant. 
Generally, subscriber drops are considered part of network equipment and may not be 
included as customer equipment in Form 393.3S However, when subscriber drops are 
installed at the time of service installation, we have stated that the tune it takes to install such 
a drop may, at the operator's discretion, be included in the time allocated to service 
installation.36 The same rationale applies to disconnection costs. Since equipment costs 
associated with disconnection activities from the subscriber drop to the demarcation point are 
considered part of network equipment, they may not be treated as customer equipment. 
Labor costs for such activities from the subscriber drop to the demarcation point may only be 
included in the time allocated to equipment services at the option of the operator. Meredith 
may choose, and appears from the record to have chosen, to treat both equipment and labor 
costs associated with activities beyond the demarcation point as general operating costs of the 
network. Any requirement by the local franchising authorities that Meredith do otherwise is
32 See Meredith's Petitions for Review of Rate Order, 7.
33 See Communications Act, § 623(b), 47 U.S.C. § 543(b). Section 623(b)(3) of the 
Communications Act requires that rates for equipment and installation reflect their actual 
costs. See also First Order on Reconsideration, Second Report and Order, and Third Notice 
of Proposed Rulemaking in MM Docket 92-266, 9 FCC Red 1164, 1190-1201 (1993) ("First 
Recon. Order").
34 The subscriber drop is that final section of the distribution plant of the cable system 
which connects the cable system to the premises of a single subscriber (or group of 
subscribers in a multi-dwelling unit).
35 Cable Television Rate Regulation, Questions and Answers (May 13, 1993), 11-12; 
See also, First Recon. Order, 9 FCC Red at 1200.
36 Id.
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not permissible. The record is not entirely clear whether the local franchising authorities 
have handled disconnection costs in this manner. Neither is the record clear whether any 
equipment costs have been incurred in these disconnection activities and whether those 
equipment costs have been excluded from customer equipment in Form 393. Accordingly, 
this issue is remanded to each of the local franchising authorities for handling consistent with 
this order.
21. Finally, Meredith argues that any reduction in the basic tier rate because of the 
authorities' recalculation of the equipment basket to include disconnection activities must be 
accompanied by a corresponding upward adjustment in Meredith's equipment rates. The 
local franchising authorities respond that Meredith requested certain rates for equipment and 
that Meredith was aware of the authorities' views on the disconnection issue as early as 
December 2, 1993 and made no request to adjust its requested equipment rates. The 
franchising authorities claim that, since they took no action relating to Meredith's equipment 
rates, those rates simply became effective, consistent with Commission rules, at the end of 
the 90-day tolling period. Therefore, the authorities argue, we cannot now order the local 
franchising authorities to increase Meredith's equipment rates since there is no decision 
regarding equipment rates for the Commission to review. In response, Meredith reiterates its 
earlier arguments and alleges that it did raise the issue of ah adjustment in its equipment 
rates in a written submission to the franchising authorities' consultant on February 16, 1994.
22. Form 393 calculations for equipment and programming are interdependent. If 
higher equipment costs are subtracted from regulated revenues in Worksheet 3, lower rates 
for programming services will result. If disconnection costs and hours are added to the 
Form 393 calculations for purposes of computing the basic tier rate and hourly service 
charge, those costs and hours cannot be ignored for purposes of calculating the equipment 
rates themselves.37 Whether an operator submits a request to the franchising authority to 
make a corresponding adjustment to its equipment rates is not controlling. If a local 
franchising authority makes adjustments to the equipment basket and thereby decreases the 
maximum permitted rates for programming service it must make the appropriate, 
corresponding adjustments to the remainder of the Form 393 calculations. Therefore, this 
issue is remanded to each of the local franchising authorities for handling consistent with this 
Order.
IV. ORDERING CLAUSES
37 We note that while Meredith argues that it is entitled to an upward adjustment in its 
equipment rates, it is possible that considering both the costs and hours associated with 
disconnection activities will lead to a decrease hi Meredith's hourly service charge. For 
rates for equipment and installation services other than the disconnection charge, such a 
decrease in the permitted hourly service charge may actually lead to a decrease in these other 
maximum permitted rates.
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23. Accordingly, IT IS ORDERED that the appeals by Meredith/New Heritage 
Strategic Partners, L.P. of the decisions of the Burnsville/Eagan and North Central Suburban 
Communications Commissions regarding procedural requirements ARE DENIED.
24. IT IS FURTHER ORDERED that the appeals by Meredith of the decisions of 
the Burnsville/Eagan and North Central Suburban Communications Commissions with regard 
to the inflation adjustment and the cost of disconnections ARE REMANDED to those local 
authorities for further consideration consistent with this opinion.
25. IT IS FURTHER ORDERED that the motions to dismiss the appeals filed by 
Meredith with respect to the local orders of the City of Columbia Heights, Minnesota and the 
North Suburban and Quad Cities Cable Communications Commissions ARE GRANTED.
26. This action is taken by the Chief, Cable Services Bureau, pursuant to authority 
delegated by § 0.321 of the Commission's rules, 47 C.F.R. § 0.321.
FEDERAL COMMUNICATIONS COMMISSION
Meredith J. Jones
Chief, Cable Services Bureau
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