[Federal Register Volume 59, Number 197 (Thursday, October 13, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-25022]
[[Page Unknown]]
[Federal Register: October 13, 1994]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Part 76
[MM Docket Nos. 92-266 and 93-215, FCC 94-234]
Cable Television Act of 1992
agency: Federal Communications Commission.
Action: Further notice of proposed rulemaking.
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summary: This further notice of proposed rulemaking is one segment of
the Fifth Order on Reconsideration and Further Notice of Proposed
Rulemaking in this proceeding. The final rules adopted in this decision
may be found elsewhere in this issue. In the Further Notice Proposed
Rulemaking, the Commission sought comment on possible alternative
definitions for small cable operators, independent small cable systems,
and small cable systems owned by small multiple system operators. The
Commission also sought comment on whether to retain current definitions
or use different definitions for purposes of establishing special rate
or administrative treatment for small operators and small multiple
system operators. The Commission specifically seeks comment on these
issues in light of Section 3(a) of the Small Business Act, and on
whether the Commission should employ the current Small Business
Administration definition of a small cable company in the cable rules.
A change in the definitions of these categories of cable operators may
affect eligibility under any final rules which the Commission may adopt
pertaining to small cable systems.
dates: Comments are due on or before November 16, 1994 and reply
comments are due on or before December 16, 1994.
addresses: Comments and reply comments should be sent to Federal
Communications Commission, 1919 M Street NW., Washington, DC 20554.
for further information contact: Susan Cosentino, (202) 416-0800.
supplementary information: This is the proposed rules segment of the
Commission's Fifth Order on Reconsideration and Further Notice of
Proposed Rulemaking in MM Docket No. 92-266 and MM Docket No. 93-215,
FCC 94-234, adopted September 12, 1994 and released September 26, 1994.
The complete text of this document is available for inspection and
copying during normal business hours in the FCC Reference Center (room
239), 1919 M Street, NW., Washington, DC, and also may be purchased
from the Commission's copy contractor, International Transcription
Service at (202) 857-3800, 2100 M Street, NW., Suite 140, Washington,
DC 20037.
Further Notice of Proposed Rulemaking
Background
In 1992, Congress amended Sec. 3(a) of the Small Business Act to
require federal agencies to use small business definitions created by
the Small Business Administration (``SBA''), or in the alternative,
seek public comment on different definitions and obtain the approval of
the Small Business Administrator with regard to any regulation
applicable to small businesses, unless other statutory definitions are
applicable. SBA rules currently define a small cable company as one
with $11 million or less in gross revenues. The Cable Television
Consumer Protection and Competition Act of 1992 defined a small cable
system as one with 1,000 or fewer subscribers. A small cable operator
is defined as one with 15,000 or fewer subscribers that is not
affiliated with a larger operator. In addition, a small multiple system
operator (``MSO'') is one serving 250,000 or fewer total subscribers
that owns only systems with less than 10,000 subscribers each and has
an average system size of 1,000 or fewer subscribers. In this
rulemaking, the SBA's Office of Advocacy and the Small Cable Business
Association have expressed concern about the Commission's definitions
of small operators eligible for transition relief and our definition of
small MSOs. Specifically, the SBA's Office of Advocacy and the Small
Cable Business Association believe the current definitions in our rules
defining eligibility for transition and administrative relief are under
inclusive and were promulgated in violation of Sec. 3(a) of the Small
Business Act. They urge us to re-evaluate the definitions and seek
public input before deciding on permanent standards.
The Chief Counsel of the SBA's Office of Advocacy has urged the
Commission to explore a full range of burden-reducing regulatory
options in our rate proceedings. We are in full agreement with that
suggestion. Based on the existing record, however, we are not persuaded
that the actions taken to date to ease the regulatory difficulties
faced by smaller operators have been undertaken in violation of the
law. Specifically, the Commission does not believe that Small Business
Administration size standards, to which federal agencies may be
required to adhere under Section 3 of the Small Business Act, are
applicable to the Commission's definitions of small cable operators and
small cable systems developed in the Second Order on Reconsideration,
Fourth Report and Order, and Fifth Notice of Proposed Rulemaking MM
Docket No. 92-266. For example, Section 3(a) of the Small Business Act
provides that SBA size standards apply for the purposes of all
legislation, unless the legislation specifically authorizes different
size standards. The Cable Television Consumer Protection and
Competition Act of 1992 (``1992 Cable Act'') in fact contains a size
definition of a small system as one with 1,000 or fewer subscribers.
See 47 U.S.C. Sec. 543(i). Specifically, the statute requires the
Commission to develop cable rate regulations that reduce cost and
administrative burdens for such ``small systems.'' Given the statute's
small system definition of 1,000 or fewer subscribers, Section 3(a) of
the Small Business Act is inapplicable. The Commission has implemented
the statutory provision regarding small system relief in a more
flexible manner than is explicitly mandated by the 1992 Cable Act and
is now considering further flexibility through extending relief to
additional systems. But this does not alter the fact that the
Commission is implementing a statute with an explicit small business
standard. Additionally, the Small Business Act defines small-business
concerns as one ``which is not dominant in its field of operation.'' 15
U.S.C. Sec. 632(a)(1). Cable systems subject to rate regulation,
regardless of whether they are large or small, are by definition
dominant in their field of operation because they do not face effective
competition. Thus, Section 3(a) of the Small Business Act also does not
apply because regulated cable systems do not meet the definition of a
small business concern.
Discussion
We established transition treatment for small operators pending
completion of our cost studies, and have established administrative
relief for independent small systems and small systems owned by small
multiple system operators (``MSOs''). Under our interim cost-of-service
rules, independent small systems and small systems owned by small MSOs
also may use special forms for cost-of-service showings. When cost
studies are completed, we may make permanent, eliminate, or modify our
transition rate treatment of small operators. When we develop average
equipment cost schedules, we may terminate or modify our provisions for
streamlined rate reductions for independent small systems and small
systems owned by small MSOs. In our final cost proceeding, we may
modify our requirements for cost showings by independent small systems
and small systems owned by small MSOs.
We believe that it would establish a more complete record for
purposes of promulgating final rate rules applicable to small
operators, independent small systems, and small systems owned by small
MSOs if we obtain comment on possible alternative definitions that we
could use for purposes of determining eligibility for special rate or
administrative treatment provisions that could apply to small
businesses. We are initiating the instant Further Notice of Proposed
Rulemaking for purposes of obtaining this comment.
Accordingly, we solicit comment on whether we should retain current
definitions or use different definitions for purposes of establishing
special rate or administrative treatment for small operators and small
MSOs that could be small businesses. We specifically seek comment on
these issues in light of Section 3(a) of the Small Business Act, and on
whether we should employ the current SBA definition of a small cable
company in our cable rules.
Administrative Matters
Initial Regulatory Flexibility Analysis
Pursuant to Section 603 of the Regulatory Flexibility Act, the
Commission has prepared the following initial regulatory flexibility
analysis (IRFA) of the expected impact of these proposed policies and
rules on small entities. Written public comments are requested on the
IRFA. These comments must be filed in accordance with the same filing
deadlines as comments on the rest of the Notice, but they must have a
separate and distinct heading designating them as responses to the
regulatory flexibility analysis. The Secretary shall cause a copy of
the Notice, including the initial regulatory flexibility analysis, to
be sent to the Chief Counsel for Advocacy of the Small Business
Administration in accordance with Section 603(a) of the Regulatory
Flexibility Act, Pub. L. No. 96-354, 94 Stat. 1164, 5 U.S.C. Section
601 et seq. (1981).
Reason for action. The Cable Television Consumer Protection and
Competition Act of 1992 requires the Commission to prescribe rules and
regulations for determining reasonable rates for basic tier cable
service and to establish criteria for identifying unreasonable rates
for cable programming services. The Commission has adopted rate
regulations that require a comparison to the rates of cable systems
subject to effective competition, as defined in the Cable Act of 1992
and represented in the revised benchmark formula. This Notice proposes
to review and determine appropriate definitions of small systems, small
operators, and small MSOs for the purpose of determining rate
regulation applicable to these categories of companies.
Objectives. To propose rules to implement Section 3 of the Cable
Television Consumer Protection and Competition Act of 1992. We also
desire to adopt rules that will be easily interpreted and readily
applicable and, whenever possible, minimize the regulatory burden on
affected parties.
Legal Basis. Action as proposed for this rulemaking is contained in
Sections 4(i), 4(j), 303(r) and 623 of the Communications Act of 1934,
as amended.
Description, potential impact and number of small entities
affected. We anticipate a possible impact on small entities because the
Notice addresses the definitions of small systems, small operators and
small MSOs for use in determining rate rules affecting these classes of
cable operators.
Reporting, recordkeeping and other compliance requirements. None.
Federal rules which overlap, duplicate or conflict with this rule.
None.
Any significant alternatives minimizing impact on small entities
and consistent with stated objectives. None.
Paperwork Reduction Act
The requirements adopted herein have been analyzed with respect to
the Paperwork Reduction Act of 1980 and found to impose no new or
modified information collection requirements on the public.
Procedural Provisions
Ex parte Rules--Non Restricted Proceeding. This is a non-restricted
notice and comment rulemaking proceeding. Ex parte presentations are
permitted, except during the Sunshine Agenda period, provided that they
are disclosed as provided in Commission rules. See generally 47 CFR
1.1202, 1.1203, and 1.1206(a).
Pursuant to applicable procedures set forth in Secs. 1.415 and
1.419 of the Commission's Rules, 47 CFR 1.415 and 1.419, interested
parties may file comments on or before November 16, 1993 and reply
comments on or before December 16, 1994. To file formally in this
proceeding, you must file an original plus four copies of all comments,
reply comments, and supporting comments. If you want each Commissioner
to receive a personal copy of your comments and reply comments, you
must file an original plus nine copes. You should send comments and
reply comments to Office of the Secretary, Federal Communications
Commission, 1919 M Street, NW., Washington, DC 20554. Comments and
reply comments will be available for public inspection during regular
business hours in the FCC Reference Center, Room 239, Federal
Communications Commission, 1919 M Street NW., Washington DC 20554.
Ordering Clauses
Authority for this Further Notice of Proposed Rulemaking is
contained in sections 4(i), U.S.C. 154(i), 154(j), 303(r), 532(c) and
543.
It is ordered That, pursuant to Sections 4(i), 4(j), 303(r),
612(c), 622(c) and 623 of the Communications Act of 1934, 47 U.S.C.
Secs. 154(i), 154(j), 303(r), 532(c), 542(c), and 543, Notice is hereby
given of proposed amendments to Part 76, in accordance with the
proposals, discussions, and statement of issues in this Further Notice
of Proposed Rulemaking, and that Comment is Sought regarding such
proposals, discussion, and statement of issues.
List of Subjects in 47 CFR Part 76
Cable television.
Federal Communications Commission.
William F. Caton,
Acting Secretary.
[FR Doc. 94-25022 Filed 10-12-94; 8:45 am]
BILLING CODE 6712-01-M