PUBLIC NOTICE FEDERAL COMMUNICATIONS COMMISSION 1919 M STREET, N.W. WASHINGTON, D.C. 20554 DA 97-130 News media information 202/418-0500 Fax-On-Demand 202/418-2830 Internet: http://www.fcc.gov ftp.fcc.gov CS No. 97-3 CABLE SERVICES ACTION January 17, 1997 THIRD QUARTER 1996 INFLATION ADJUSTMENT FIGURE FOR CABLE OPERATORS USING FCC FORM 1240 NOW AVAILABLE As described in the instructions for FCC Form 1240, cable operators may adjust the non- external cost portion of their rates for inflation based on quarterly figures released by the Commission. The Third Quarter 1996 Inflation Factor for operators using FCC Form 1240 is 2.21%. The adjustment factor of 2.21% is a measure of the annualized change in prices occurring over the period from July 1, 1996 to September 30, 1996. The factor is based on the changes in the quarterly Gross National Product Price Index (GNP-PI) published by the Bureau of Economic Analysis (BEA) of the United States Department of Commerce. The indexes used, the Gross National Product: Chain-type price indexes for the second quarter 1996 and the third quarter 1996, were obtained from Table 4 of the BEA news release dated December 20, 1996 (BEA 96-40). The inflation adjustment factor is calculated by taking the GNP-PI from the third quarter of 1996 (110.2) and dividing by the GNP-PI for the second quarter of 1996 (109.6). 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. Operators calculating the Inflation Factor for a True-Up Period which includes some portion of the third quarter of 1996 should enter the inflation factor on the appropriate lines of Worksheet 1 of FCC Form 1240 as "0.0221". Operators using this factor for calculating the Projected Period Inflation Segment of FCC Form 1240 should enter this number on Line C3 as "1.0221". To date the Commission has released five quarterly inflation factors for use with FCC Form 1240. The following table lists these factors: Year Quarter Dates Covered Inflation Factor 1995 Third Jul. 1, 1995 - Sep. 30, 1995 2.22% 1995 Fourth Oct. 1, 1995 - Dec. 31, 1995 2.22% 1996 First Jan. 1, 1996 - Mar. 31, 1996 2.39% 1996 Second Apr. 1, 1996 - Jun. 30, 1996 2.22% 1996 Third Jul. 1, 1996 - Sep. 30, 1996 2.21% 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: http://www.fcc.gov/Bureau/Cable/WWW/csb.html. Media contact: Morgan Broman (202) 418-2358. Cable Services Bureau Contact: Hugh Boyle (202) 418-2286. --FCC--