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PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA

Communications Division

RESOLUTION T-17353

Policy & Decision Analysis Branch

January 12, 2012

R E S O L U T I O N

Resolution T-17353. ADOPTING ANNUAL FEE TO IMPLEMENT THE DIGITAL INFRASTRUCTURE AND VIDEO COMPETITION ACT (DIVCA) FOR FISCAL YEAR 2011-12.

____________________________________________________________

Summary

This Resolution sets the annual fee for the fiscal year 2011-2012 to be paid by each video franchise holder at $0.0423 (4.23 cents) per household in its video franchise territory. This is a 1.4% increase from 4.17 cents per household last year. This fee will generate revenue equal to the Commission's authorized budget for implementation of AB 2987, the Digital Infrastructure and Video Competition Act.

Background

The Digital Infrastructure and Video Competition Act of 2006 (DIVCA) was signed into law on September 29, 2006, creating for the first time a process for the issuance of state video franchises in California.1 On March 1, 2007, the Commission issued D. 07-03-014 (DIVCA Decision) 2, implementing DIVCA, and began accepting video franchising applications immediately thereafter. To date, the Commission has issued 127 video franchises and amendments.

DIVCA requires the Commission to collect annual fees from all state-issued video franchise holders.3 The total amount of fees collected is to equal the amount authorized in the Commission budget for DIVCA implementation. For the 2011-2012 fiscal year, $950,000 was authorized to implement the state video franchise program.4 The DIVCA Decision provided that the annual fee for each video franchisee, after the initial year, was to be calculated based on the percentage of all state video franchise holders' gross state video franchise revenues that is attributable to an individual state video franchise holder.5 The fee was to be calculated based on the revenue reported for the prior calendar year.

It became apparent that allocating the annual fee based on holders' revenues was not an equitable approach, given the allocation of revenues among holders during the early phases of DIVCA implementation. Accordingly, the CPUC adopted D. 09-04-011, modifying D. 07-03-014, to provide for setting the annual fee based on a pro-rata allocation of households in holders' video service territories, rather than according to revenues, through the 2011 -2012 fiscal year. 6

Comments

There were no comments received.

Discussion

This Resolution sets the annual fee due per household in a video franchise holder's service area for FY 2011-2012 consistent with the D. 09-04-011.

The Commission will send all video franchise holders fee statements after adoption of this Resolution. Video franchise holders with franchises issued any time on or prior to June 30, 2012 are required to pay the annual fee for the full Fiscal Year 2011-12. Video franchise holders with franchises issued on or before the date of this Resolution must pay their annual fees for Fiscal Year 2011-12 before April 30, 2012. Holders of franchises granted after the date of the Resolution shall pay the fee amount to the Commission within 60 days after the issuance of their franchise or by June 30, 2012, whichever is earlier.

The total number of households that existed in the franchise territories of all franchise holders as of December 2, 2011 was 22,441,618. This number declined by 332,127 or 1.5% from last year's total, because last year's household total was forecast from the 2000 census. This year we used actual numbers from the 2010 census.

In order to generate the $950,000 authorized for the Commission's Fiscal Year 2011-2012 DIVCA-related budget, the amount due per household is $0.0423.7 This is a 1.4% increase from $0.0417 per household last year and a decrease from $0.0434 the year before last.

Appendix A lists each of the franchise holders as of December 2, 2011, the number of households in their service area, and their total annual fee for the 2011-2012 fiscal year.

Notice

In compliance with PU Code Section 311(g), a copy of this proposed Resolution was either mailed or e-mailed to all parties of record in R. 06-10-005 on December 9, 2011.

Findings:

1. AB 2987, the Digital Infrastructure and Video Competition Act requires the Commission to calculate, and holders of state-issued video franchises to pay, an annual fee.

2. The annual fee for fiscal year 2011-2012 is to be calculated based on each holder's pro-rata share of households in franchised video territories, in accordance with D. 09-04-011.

3. Fees in the aggregate are to equal the Commission's authorized budget for implementation of DIVCA requirements.

4. The total number of households in all Holders' video franchise territories as of November, 21, 2010 was 22,441,618. This is a 1.5% (332,127) decrease from 22,773,745 last year and an increase from 21,849,660 households the year before last.

5. The Commission's authorized DIVCA-related budget for the fiscal year
2011-2012 is $950,000.

6. A fee of $0.0423 per household is reasonably calculated to collect an amount equal to its DIVCA-related budget for the 2011-2012 fiscal year.

7. A schedule of fees based on franchises issued by December 2, 2011 is attached as Appendix A.

8. The Commission will send fee statements to existing holders of state video franchisees upon approval of this Resolution.

9. Parties of Record in R. 06-10-005 were provided with notice of this Resolution in accordance with PU Code Section 311(g).

THEREFORE, IT IS ORDERED that:

1. Holders of state video franchises granted on or before the date of this Resolution shall remit to the Commission the amount indicated in their fee statements by April 30, 2012.

2. Holders of state video franchises granted after the date of this Resolution shall remit their fee payment to the Commission within 60 days after the issuance of their franchise, or June 30, 2012, whichever is earlier.

This Resolution is effective today.

I hereby certify that the Public Utilities Commission adopted this Resolution at its regular meeting on January 12, 2012. The following Commissioners approved it:

Appendix A- Fiscal Year 2011-2012 Annual Fee Assessment Based on the Number of Households in Video Franchise Area

Video Franchise Holders with Franchises Issued as of December 2, 2011

Franchise ID

Franchise Issue Date

Total Number of Households in Video Service Area

Fee Assessment

Verizon California, Inc

001

March 8, 2007

   

Verizon California, Inc. 1st Amended

001

December 19, 2007

   

Verizon California, Inc. 2nd Amended

001

April 1, 2009

   

Verizon California Subtotal

 

 

1,954,008

$82,655

Pacific Bell Telephone Company dba AT&T California

002

March 30, 2007

   

AT&T California 1st Amended

002

July 29, 2009

   

AT&T California 2nd Amended

002

September 21, 2009

   

AT&T California 3rd Amended

002

August 26, 2010

   

AT&T California 4th Amended

002

December 2, 2011

   

AT&T California Subtotal

 

 

9,733,865

$411,742

Cox Communications

003

April 27, 2007

   

Cox Communications 1st Amended

003

January 2, 2008

   

Cox Communications 2nd Amended

003

May 2, 2008

   

Cox Communications 3rd Amended

003

May 29, 2009

   

Cox Communications 4th Amended

003

June 23, 2009

   

Cox Communications 5th Amended

003

January 7, 2010

   

Cox Communications 6th Amended

003

October 5, 2010

   

Cox Communications 7th Amended

003

November 1, 2010

   

Cox Communications 8th Amended

003

November 1, 2010

   

Cox Communications 9th Amended

003

February 17, 2011

   

Cox Communications 10th Amended

003

March 25, 2011

   

Cox Communications 11th Amended

003

May 11, 2011

   

Cox Communications 12th Amended

003

June 17, 2011

   

Cox Communications 13th Amended

003

June 30, 2011

   

Cox Communications 14th Amended

003

November 2, 2011

   

Cox Communications Subtotal

 

 

1,208,547

$51,122

Cableview Communications

006

December 6, 2007

270

$11

CCO SoCal I dba Charter Communications1

007

November 7, 2011

1,299,748

$54,979

CCO SoCal II dba Charter Communications2

027

November 7, 2011

76,705

$3,245

         
         
         

Video Franchise Holders with Franchises Issued as of December 2, 2011

Franchise ID

Franchise Issue Date

Total Number of Households in Video Service Area

Fee Assessment

FCSC II, LLC dba Charter Communications

010

December 13, 2007

   

FCSC II, LLC dba Charter Com. 1st Amended

010

February 25, 2008

   

FCSC II, LLC dba Charter Com. 2nd Amended

010

June 27, 2008

   

FCSC II, LLC dba Charter Com. 3rd Amended

010

November 10, 2008

   

FCSC II, LLC dba Charter Com. 4th Amended

010

February 6, 2009

   

FCSC II, LLC dba Charter Com. 5th Amended

010

October 30, 2009

   

FCSC II, LLC dba Charter Com. 6th Amended

010

December 18, 2009

   

FCSC II, LLC dba Charter Com. 7th Amended

010

February 8, 2010

   

FCSC II, LLC dba Charter Com. 8th Amended

010

February 8, 2010

   

FCSC II, LLC dba Charter Com. 9th Amended

010

November 8, 201

   

FCSC II, LLC dba Charter Com. 10th Amended

010

February 17, 2011

   

FCSC II, LLC dba Charter Communications Subtotal

   

29,270

$1,238

Falcon Telecable dba Charter Communications

012

December 13, 2007

   

Falcon Telecable dba Charter Communications 1st Amended

012

September 6, 2011

   

Falcon Telecable dba Charter Communications Subtotal

   

7,921

$335

Time Warner NY Cable, LLC dba Time Warner Cable

005

November 15, 2007

   

TWNYC, LLC dba Time Warner Cable 1st Amended

005

July 7, 2008

   

TWNYC, LLC dba Time Warner Cable 2nd Amended

005

August 4, 2008

   

TWNYC, LLC dba Time Warner Cable 3rd Amended

005

March 12, 2009

   

TWNYC, LLC dba Time Warner Cable 4th Amended

005

March 23, 2009

   

TWNYC, LLC dba Time Warner Cable 5th Amended

005

June 18, 2009

   

TWNYC, LLC dba Time Warner Cable 6th Amended

005

July 16, 2009

   

TWNYC, LLC dba Time Warner Cable 7th Amended

005

September 1, 2009

 

 

TWNYC, LLC dba Time Warner Cable 8th Amended

005

July 1, 2010

   

TWNYC, LLC dba Time Warner Cable 9th Amended

005

November 16, 2010

   

TWNYC, LLC dba Time Warner Cable 10th Amended

005

March 30, 2011

   

TWNYC, LLC dba Time Warner Cable Subtotal3

 

November, 2011

3,570,139

$151,017

Time Warner Cable, LLC

018

December 19, 2007

   

Time Warner Cable, LLC 1st Amended

018

July 7, 2008

 

 

Time Warner Cable, LLC 2nd Amended

018

March 30,2011

   

Time Warner Cable, LLC Subtotal

 

 

492,116

$20,817

         
         
         
         

Video Franchise Holders with Franchises Issued as of December 2, 2011

Franchise ID

Franchise Issue Date

Total Number of Households in Video Service Area

Fee Assessment

Time Warner Entertainment-Advance/Newhouse Partnership

019

December 19, 2007

   

TWEANP dba Time Warner Cable 1st Amended

019

July 11, 2008

   

TWEANP dba Time Warner Cable 2nd Amended

019

August 6, 2008

   

TWEANP dba Time Warner Cable 3rd Amended

019

December 16, 2008

 

 

TWEANP dba Time Warner Cable 4th Amended

019

December 3, 2010

   

TWEANP dba Time Warner Cable Subtotal

 

 

244,716

$10,351

Time Warner Entertainment Company

020

December 19, 2007

   

TWEC dba Time Warner Cable 1st Amended

020

August 6, 2008

 

 

TWEC dba Time Warner Cable Subtotal

 

 

3,721

$157

Northland Cable Television, Inc.

015

December 14, 2007

   

Northland Cable Television, Inc. 1st Amended

015

July 7, 2008

   

Northland Cable Television, Inc. 2nd Amended

015

July 7, 2008

 

 

Northland Cable Television, Inc. Subtotal

 

 

8,001

$338

Comcast

021

January 2, 2008

   

Comcast 1st Amended

021

March 14, 2008

   

Comcast 2nd Amended

021

April 25, 2008

   

Comcast 3rd Amended

021

June 6, 2008

   

Comcast 4th Amended

021

July 28, 2008

   

Comcast 5th Amended

021

August 11, 2008

   

Comcast 6th Amended

021

October 16, 2008

   

Comcast 7th Amended

021

March 23, 2009

   

Comcast 8th Amended

021

July 29, 2009

   

Comcast 9th Amended

021

June 21, 2010

   

Comcast 10th Amended

021

August 26, 2010

   

Comcast 11th Amended

021

November 16, 2010

   

Comcast 12th Amended

021

February 17, 2011

   

Comcast 13th Amended

021

February 17, 2011

   

Comcast 14th Amended

021

April 26, 2011

   

Comcast 15th Amended

021

April 26, 2011

   

Comcast 16th Amended

021

June 13, 2011

   

Comcast 17th Amended

021

June 30, 2011

   

Comcast 18th Amended

021

September 12, 2011

   

Comcast Subtotal

   

2,751,536

$116,390

         
         

Video Franchise Holders with Franchises Issued as of December 2, 2011

Franchise ID

Franchise Issue Date

Total Number of Households in Video Service Area

Fee Assessment

Baldwin County Internet/DSSI Service, LLC

022

March 3, 2008

2,891

$122

Audeamus, LLC dba Sebastian

023

April 4, 2008

   

Audeamus, LLC dba Sebastian 1st Amended

023

August 26, 2011

   

Audeamus, LLC dba Sebastian

   

6,643

$281

CalTel Connections dba Calaveras Cablevision

025

May 16, 2008

   

CalTel Connections dba Calaveras Cablevision 1st Amended

025

December 30, 2009

   

CalTel Connections dba Calaveras Cablevision Subtotal

   

3,086

$131

Antilles Wireless, LLC dba Cable USA

026

June 9, 2008

1,280

$54

Astound Broadband, LLC

028

October 16, 2008

   

Astound Broadband, LLC 1st Amended

028

November 9, 2009

   

Astound Broadband, LLC 2nd (Reorganization)

028

January 13, 2011

   

Astound Broadband, LLC 3rd Amended

028

August 17, 2011

   

Astound Broadband, LLC 4th Amended

028

September 28, 2011

   

Astound Broadband, LLC 5th Amended

028

October 28, 2011

   

Astound Broadband, LLC Subtotal4

   

320,599

$13,561

Surewest Televideo dba Surewest Broadband

029

December 10, 2008

   

Surewest Televideo dba Surewest Broadband 1st Amended

029

April 29, 2009

   

Surewest Televideo dba Surewest Broadband Subtotal

   

318,197

$13,460

CBC Broadband Holdings, LLC dba Champion Broadband

030

December 22, 2008

32,278

$1,365

Redwood IPTV, LLC

032

August 31, 2009

126,354

$5,345

Mediacom, LLC

033

September 23, 2009

71,380

$3,019

Suddenlink Cequel III Communications I, LLC

034

November 11, 2009

   

Suddenlink Cequel III Communications I, LLC 1st Amended

034

November 1, 2010

   

Suddenlink Cequel III Communications I, LLC Subtotal

   

7,673

$325

Suddenlink NPG Cable, LLC

040

May 5, 2011

   

Suddenlink NPG Cable, LLC 1st Amended

040

June 27, 2011

   

Suddenlink NPG Cable, LLC Subtotal

   

4,919

$208

Suddenlink Cebridge Acquisition, LP

044

October 6, 2011

187

$8

Volcano Communications Company dba Volcano Vision

035

November 19, 2009

   

Volcano Vision 1st Amended

035

February 11, 2011

   

Volcano Communications Company dba Volcano Vision

   

512

$22

Greenfield Communications

036

January 19, 2010

   

Greenfield Communications 1st Amended

036

May 11, 2011

   

Greenfield Communications, Inc.

   

6,605

$278

Video Franchise Holders with Franchises Issued as of December 2, 2011

Franchise ID

Franchise Issue Date

Total Number of Households in Video Service Area

Fee Assessment

CalNeva Broadband, LLC

037

March 1, 2010

2,375

$100

Horizon Cable TV, Inc.

038

October 5, 2010

   

Horizon Cable TV, Inc. 1st Amended

038

June 17, 2011

   

Horizon Cable TV, Inc.

   

7,492

$317

Bright House Networks, LLC

039

November 1, 2010

1,840

$78

Media 3 Communications, Inc.

041

August 5, 2011

114,147

$4,828

Google Fiber California, LLC

042

August 26, 2011

2,198

$93

Sonic Telecom, LLC

043

September 16, 2011

30,399

$1,286

         

Total

   

22,441,618

$949,280

1 American Cable Entertainment Company, LLC; Charter Communications Entertainment II, LLC; Charter Communications Properties, LLC; Falcon Cablevision, LLC; Long Beach, LLC; Marcus Cable Associates, LLC; and part of Falcon Cable Systems Company II, LP were reorganized under Charter Communications Operating (CCO) SoCal I on November 7, 2011

2 Dalton Cablevision was reorganized under Charter Communications Operating (CCO) SoCal II in November 7, 2011

3 CAC Exchange I, LLC; CAC Exchange II, LLC; and C-Native Exchange I, LLC were reorganized under Time Warner NY Cable under its 4th amendment

4 Wave Broadband was reorganized under Astound Broadband on January 13, 2011

Note: We expect there will be additional amendments or franchises issued in 2012 so we expect to make up the difference between the budget and the $719 shortfall shown above.

1 AB 2987, 2005-2006 Session (Ca. 2006); Cal. Pub. Util. Code, Division 2.5, The Digital Infrastructure and Video Competition Ace of 2006 (DIVCA).

2 Decision Adopting a General Order and Procedures to Implement the Digital Infrastructure and Video Competition Act of 2006, Decision 07-03-014, Rulemaking for Adoption of a General Order and Procedures to Implement the Digital Infrastructure and Video Competition Act of 2006 (Cal. P.U.C. March 3, 2007) (D. 07-03-014).

3 Cal. Pub. Util. Code § 441, as added by AB 2987, reads, in part, as follows:

441. The commission shall annually determine a fee to be paid by an

applicant or holder of a state franchise pursuant to Division 2.5

(commencing with Section 5800). The annual fee shall be established to

produce a total amount equal to that amount established in the authorized

commission budget for the same year to carry out the provisions of

Division 2.5 (commencing with Section 5800)....

4 Decision 07-03-014, p. 115.

5 Decision 07-03-014, pp. 122-123

6 Order Instituting Rulemaking to Consider the Adoption of a General Order and Procedures to Implement the Digital Infrastructure and Video Competition Act of 2006, Decision 09-04-011, Decision Modifying Decision 07-03-014 (Cal. P.U.C. April 16, 2009), Ordering Paragraph 1, pp. 7. ("1. Decision 07-03-014 and General Order 169 are modified to adopt a user fee process for Fiscal Year 2008-2009 to Fiscal Year 2012-2013 to allocate the Digital Infrastructure and Video Competition Act of 2006 implementation costs based on a pro-rata share of the number of households in each state franchise holder's video service territory.")

7 While the per-household fee for FY 2011-2012 is 4.23 cents, by way of comparison, the per-household fee for FY 2008-09 was 4.48 cents per household.

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