FCC Reports, Second Series, Volume 104, Number 2, Pages 375 to 719, August 1986 Page: 414
ix, 375-719 p. ; 23 cm.View a full description of this report.
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Federal Communications Commission Reports
To determine this just and reasonable pole attachment rate,
Congress directed the Commission to "institute an expeditious
program which will necessitate a minimum of staff, paperwork
and procedures consistent with fair and efficient regulation."
S. Rep. No. 95-580, 95th Cong., 1st Sess. 21 (1977). To that end,
Congress noted that although there may be some difficulty in
determining the components of the operating expenses and actual
capital costs of the utility, special accounting measures or studies
should not be necessary since the majority of the cost and
expense items attributable to the utility pole plant are already
established and reported to various regulatory bodies and there-
fore the information is already a matter of public record. Id. at
19-20. Congress did not expect the Commission to reexamine the
reasonableness of the cost methodology sanctioned by the various
regulatory agencies, and it recognized that the Commission would
have to "make its best estimate" of some of the less readily
identifiable costs. Id. at 20.
3. As indicated above, the range of rates set out by Congress
permits the Commission leeway to fix the rate somewhere
between the incremental costs of the utility and cable's share of
the utility's fully allocated costs. Incremental costs consist of
those costs which would not be incurred by the utility "but for"
the presence of cable attachments. Id. at 19. Congress noted that
incremental costs might include pre-construction survey costs and
engineering, make-ready and change-out costs incurred in prepar-
ing the utility pole for cable attachments. Id. at 19. However, it
expected a pole attachment rate based on incremental costs to be
minimal, since most of those costs would have been fully
recovered in the make-ready charges already paid by the cable
company. Id.
4. By contrast, fully allocated costs refer to the operating
expenses and capital costs incurred by the utility in owning and
maintaining poles regardless of the presence of cable. Operating
expenses and capital costs of poles include interest on debt,
return on equity (profit), depreciation, taxes, administrative and
maintenance expenses. Id. at 19-20. In practical terms, Congress
intended the Commission to establish a formula by which rates
could readily be calculated based on the Commission's best
judgment as to how to allocate costs between the utility and the
cable operator. Id.
5. Based on the statutory language, the Commission estab-
lished the following formula to determine the cable company's
share of the utility's fully allocated costs of owning a pole:104 F.C.C. 2d
414
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United States. Federal Communications Commission. FCC Reports, Second Series, Volume 104, Number 2, Pages 375 to 719, August 1986, report, 1986-08~; Washington D.C.. (https://digital.library.unt.edu/ark:/67531/metadc306573/m1/52/: accessed July 17, 2024), University of North Texas Libraries, UNT Digital Library, https://digital.library.unt.edu; crediting UNT Libraries Government Documents Department.