********************************************************    
                         NOTICE
********************************************************

This document was converted from
WordPerfect to ASCII Text format.

Content from the original version of the document such as
headers, footers, footnotes, endnotes, graphics, and page numbers
will not show up in this text version.

All text attributes such as bold, italic, underlining, etc. from the
original document will not show up in this text version.

Features of the original document layout such as
columns, tables, line and letter spacing, pagination, and margins
will not be preserved in the text version.

If you need the complete document, download the
WordPerfect version or Adobe Acrobat version, if available.

*****************************************************************
                                Before the
                     Federal Communications Commission
                          Washington, D.C. 20554

In the Matter of  )     
                  )     
Falcon Video Communications, L.P.          )     CUID No.  SC0162 (Beaufort County)   
      
                  )
Complaint Regarding     )     
Cable Programming Services Tier Rates      )           
                  )     


ORDER
        
        Adopted:  December 31, 1997                Released:  January 7, 1998  

By the Chief, Financial Analysis and Compliance Division, Cable Services Bureau:

  1.    In this Order we consider a complaint against the October 1, 1997 rate increase of the
above-referenced operator ("Operator") for its cable programming services tier ("CPST") in the
community referenced above.  Operator has attempted to justify its CPST rate by filing FCC Form 1240. 

  2.    Under the Communications Act, the Commission is authorized to review the CPST rates
of cable systems not subject to effective competition to ensure that rates charged are not unreasonable. 
The Telecommunications Act of 1996 ("1996 Act") and our rules implementing the legislation ("Interim
Rules"), require that a complaint against the CPST rate be filed with the Commission by a local
franchising authority ("LFA") that has received more than one subscriber complaint.  

  3.     The LFA for the franchise area referenced above filed a complaint with the Commission
on November 10, 1997.  The LFA verified that it received more than one subscriber complaint for the
franchise area and that the first valid complaint was received by the LFA on  October 13, 1997.  The
filing of a complete and timely complaint triggers an obligation upon the cable operator to file a
justification of its CPST rates.  The Operator has the burden of demonstrating that the CPST rates
complained about are reasonable.  If the Commission finds a rate to be unreasonable, it shall determine
the
correct rate and any refund liability.  

  4.      Operators may justify their rates on an annual basis using FCC Form 1240 to reflect
reasonably certain and quantifiable changes in external costs, inflation, and the number of regulated
channels that are projected for the twelve months following the rate change.  Any incurred cost that is
not projected may be accrued with interest and added to rates at a later time.
  
  5.   Upon review of Operator's FCC Form 1240 for the projected period October 1, 1997
through September 30, 1998, we find that Operator has not correctly calculated its maximum permitted
rate ("MPR").  Operator used its actual CPST rate as the starting rate on Line A1 of its FCC Form 1240. 
Operator included true-up adjustments for the period July 1, 1996 through June 30, 1997.  However,
because Operator filed its FCC Form 1240 with the Commission in response to a complaint, and Operator
was not subject to regulation by the Commission at the time the complaint was filed, Operator is not
entitled to any true-up adjustment.  Therefore, we recalculated Operator's FCC Form 1240 without the
true-up adjustment in Module I, Line I8.  We also corrected Operator's inflation factor at Line C5 from
1.0183 to 1.0177 to reflect the inflation factor for the second quarter of 1997 released by the Commission
on October 10, 1997.  Despite these adjustments, we find Operator's actual CPST rate of $3.96 to be
reasonable.

  6.   Accordingly, IT IS ORDERED, pursuant to Section 0.321 of the Commission's rules,
47 C.F.R.  0.321, that the CPST rate of $3.96, charged by Operator in the franchise area referenced
above, effective October 1, 1997,  IS REASONABLE.

  7.   IT IS FURTHER ORDERED, pursuant to Section 0.321 of the Commission's rules, 47
C.F.R.  0.321, that Operator take into account our FCC Form 1240 adjustments when calculating its
maximum permitted rate and performing the true-up calculation on its next FCC Form 1240.    

  8.   IT IS FURTHER ORDERED, pursuant to Section 0.321 of the Commission's rules, 47
C.F.R.  0.321, that the referenced complaint IS  DENIED.

       FEDERAL COMMUNICATIONS COMMISSION 



       Elizabeth W. Beaty
       Chief, Financial Analysis and Compliance Division
       Cable Services Bureau