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04/2¢/96 17:~4 ~ 784 347 4710 Centpalina COG P.05 <br /> <br />CABLE MAXIMUM ADJUSTED COST PERCENT <br />PROGRAM- PERMITTED CABLE DIFFERENCE CHANGE <br />MING SERVICE CALCULATED PROGRAM- BETWEEN <br />TIER RATE UP RATE IN FCC MING PREVIOUS <br />UNTIL 12-31-95 FORM 1240 SERVICE RATE AND <br /> TIER RATE NEW RATE <br /> FROM <br /> 1-1-96 TO <br /> 12-31-96 <br />$16.63 $19.71 $19.16 $2.53 15.21% <br /> <br />The $2.53 increase in the table above reflects changes in the channels offered, inflation, changes in <br />expenses (particularly progranuning costs), and a "revenue neutral" adjustment (as per the Social <br />Contract) to offset the Basic Service Tier 10% reduction, as allowed by the FCC. [Note: ~ime <br />Warner moved TNT from the SuperStation Service Package to the Cable Programming Service Tier, <br />as part of the Social Contract agreement. This resulted in a decrease in the prim of the SuperStation <br />Package from $.60 to $.45.] <br /> <br />Although Time Warner was allowed to charge as much as $19.71 for the Cable Programming <br />Service Tier, they chose to charge $19.16, which represents a monthly increase of $2.53 over the <br />1995 tier rate. This equates to a 15.21% increase in this tier rate, which is somewhat offset by the <br />corresponding decrease in the Basic Service Tier of $30. <br /> <br />Time Warner cooperated with all requests in the review process, providing all necessary financial <br />info~ti-~ation mid clarifications. <br /> <br />SUMMARY <br /> <br />Centralina Council of Governments concludes that the rates set for the both the Basic Service Tier <br />and the Cable Programming Service Tier is within FCC guidelines and is in compliance with <br />currently applicable FCC rules. Cabarrus County should exercise its right as a Franchise Authority <br />to approve the Maximum Permitted Rates for the Basic Service Tier. <br /> <br /> APPROVED BY: <br /> Sandra Albrec ltions Administrator <br /> <br />DATE: April 24, 1996 <br /> <br /> <br />