§ 114.02  REVIEW OF INITIAL BASIC CABLE RATES.
   (A)   Notice. Upon the adoption of this chapter and the certification of the city by the FCC, the city shall immediately notify all cable operators in the city, by certified mail, return receipt requested, that the city intends to regulate subscriber rates charged for the basic service tier and associated equipment as authorized by the Cable Act of 1992.
   (B)   Cable operator response. Within 30 days of receiving notice from the city, a cable operator shall file with the city, its current rates for the basic service tier and associated equipment and any supporting material concerning the reasonableness of its rates, including FCC Form 393 or any other forms prescribed by the FCC to be used by cable operators to demonstrate the reasonableness of their rates.
   (C)   Expedited determination and public hearing. If the City Council is able to expeditiously determine that the initial basic rates appear to be within the FCC'S reasonable rate standard, as determined by the applicable benchmark analysis in division (G) of this section, the City Council shall:
      (1)   Hold a public hearing at which interested persons may express their views; and,
      (2)   After consideration of the views of interested persons, either act to approve the rates within 30 days from the date the cable operator filed its basic cable rates with the city, or act to extend the review period as provided in division (D) of this section.
   (D)   Extended review period.
      (1)   If the City Council is unable to determine whether the Initial Basic Cable Rates are within the FCC's reasonable rate standard based on the material before it, or if the cable operator submits a cost-of-service showing, the City Council shall, within 30 days from the date the cable operator filed its initial basic cable rates with the city and by adoption of a formal resolution, invoke the following additional periods of time, as applicable, to make a final determination:
         (a)   Ninety days if the City Council needs more time to ensure that a rate is within the FCC's reasonable rate standard; or
         (b)   One hundred fifty days if the cable operator has submitted a cost-of-service showing seeking to to justify a rate above the applicable benchmark.
      (2)   If the City Council has not made a decision within the 90- or 150-day period, the City Council shall issue a brief written order at the end of the period directing the cable operator to keep accurate account of all amounts received by reason of the Initial Basic Cable Rates and on whose behalf the amounts are paid.
   (E)   Public hearing. During the extended review period and before taking action on the initial basic cable rates, the City Council shall hold at least one public hearing at which interested persons may express their views and record objections.
   (F)   Objections. An interested person who wishes to make an objection to the initial basic cable rates may request the City Secretary to record the objection during the public hearing or may submit the objection in writing anytime before the decision resolution is adopted. In order for an objection to be made part of the record, the objector must provide the City Secretary with the objector's name and address.
   (G)   Benchmark analysis. If a cable operator submits its initial basic cable rates schedule as being in compliance with the FCC's reasonable rate standard, the City Council shall review the rates using the benchmark analysis in accordance with the standard form authorized by the FCC. Based on the City Council's findings, the initial maximum monthly charge shall be established as follows:
      (1)   The initial permitted per channel charge shall be determined as follows:
         (a)   If the initial basic cable rates contain a per channel charge for regulated programming services and equipment in effect on the date of initial regulation 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.
         (b)   If the initial basic cable rates contain a per channel charge for regulated programming services and equipment in effect on the date of initial regulation above the benchmark per channel charge, as adjusted forward for inflation from September 30, 1992, until the initial date of regulation, and the per channel charge for regulated programming services and equipment in effect on September 30, 1992, was above the benchmark per channel charge, then the initial 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.
         (c)   If the initial basic cable rates contain a per channel charge for regulated programming services and equipment in effect on the date of initial regulation above the benchmark per channel charge, as adjusted forward for inflation from September 30, 1992, until the initial date of regulation, and the per channel charge for regulated programming services and equipment in effect on September 30, 1992, was below the benchmark per channel charge, then the initial 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 all regulated tiers.
      (2)   The initial maximum monthly charge shall be determined by multiplying the initial permitted per channel charge times the number of channels on the basic service tier plus a charge for franchise fees.
   (H)   Cost-of-service showings. If a cable operator does not wish to reduce the rates to the level permitted using the benchmark analysis, the cable operator shall have the opportunity to submit a cost-of-service showing in an attempt to justify a maximum monthly charge per subscriber above the FCC's reasonable rate standard. The City Council will review a cost-of-service submission pursuant to FCC standards for cost-of-service review. The City Council may approve initial basic cable rates above the benchmark if the cable operator makes the necessary showing; however, a cost-of-service determination resulting in rates below the benchmark or below the cable operator's September 30, 1992 rates minus 10%, will prescribe the cable operator's new rates.
   (I)   Decision.
      (1)   By formal resolution. After completion of its review of the cable operator's initial basic cable rates, the City Council shall adopt its decision by formal resolution. The decision shall include one of the following:
         (a)   If the initial basic cable rates are within the FCC's reasonable rate standard or are justified by a cost-of-service analysis, the City Council shall approve the initial basic cable rates as the maximum monthly charge per subscriber; or
         (b)   If the initial basic cable rates are not within the FCC's reasonable rate standard and the cost-of-service analysis, if any, does not justify such rates, the City Council shall establish the maximum monthly charge per subscriber that is within the FCC's reasonable rate standard or that is justified by a cost-of-service analysis.
      (2)   Rollbacks and refunds. If the City Council determines that the initial basic cable rates as submitted exceed the reasonable rate standard or that the cable operator's cost-of-service showing justifies lower rates, the City Council may order the rates reduced in accordance with division (G) or (H) of this section, as applicable. In addition, the City Council may order the cable operator to pay to subscribers, refunds of the excessive portion of the rates with interest (computed at applicable rates published by the Internal Revenue Service for tax refunds and additional tax payments). The method for paying any refund and the interest rate will be in accordance with FCC regulations as directed in the City Council's decision resolution.
      (3)   Statement of reasons for decision and public notice. If initial basic cable rates of a cable operator are disapproved in whole or in part, or if there were objections made by other parties to the initial basic cable rates, the resolution must state the reasons for the decision and the City Council must give public notice of its decision. Public notice will be given by advertisement once in the official news-paper of the city.
   (J)   Appeal. The City Council's decision concerning rates for the basic service tier or associated equipment, may be appealed to the FCC in accordance with applicable federal regulations.
(Ord. 94-14, passed 4-26-94)