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Before the FEDERAL COMMUNICATIONS COMMISSION Washington, D

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Before the FEDERAL COMMUNICATIONS COMMISSION Washington, D Before the FEDERAL COMMUNICATIONS COMMISSION Washington, D. C. 20554 In the Matter of ) ) File No. EB-02-TS-069 Waiver of the Rules ofthe Federal ) FO Docket No. 91 -301 Communications Commission Relating ) FO Docket No 91-171 to Implementation ofthe Emergency ) Broadcast System ) Branch Cable, Inc. To: Chief, Office of Homeland Security, Enforcement Bureau PETITION FOR FURTHER WAIVER OF EMERGENCY ALERT SYSTEM REOUIREMENTS Branch Cable, Inc. (hereinafter "Petitioner"), by its attorneys, respectfully requests a further waiver of Section 11.11 of FCC Rules, 47 U.S.CO § 11.11. Specifically, Petitioner seeks further additional time to comply with the requirement to implement Emergency Alert System ("EAS") equipment and procedures at Petitioner's cable television headend systems at Crosby, New Augusta, New Hebron and Roxie, Mississippi. Section 11.II(a) requires cabletelevision systems serving fewer than 5,000 subscribers eitherto providethe national level EAS message on all programmed channels- including the required testing - or to install EAS equipment and provide a video interrupt and audio alert on all prognumned channels and EAS audio and visual messages on at least one progrmmned channeL Petitionerrequests a furtherwaiverperrnitting additional time for the cable television headend systems at the nmned communities to comply with these requirements., Petitioner relies herein upon the mechanism for waiver established in the SecondReport andOrderin FO DocketNos. 91-30I and 91-171, FCC 97-338, found at 12 FCC Rcd 1550.3, see ~19 et seq. (1997). 2 Background On February 12, 2002 Petitioner filed a Petition For Waiver Of Emergency Alert System Requirements, which were then scheduled to take effect on October 1, 2002 The Enforcement Bureau ("the Bureau") granted Petitioner a temporary waiver of the requirements for EAS implementation, including the requirements for testing and monitoring. Jj Recognizing that the estimated $100,000 cost of EAS equipment for Petitioner's set ofsmall cable systems would cause a financial hardship on Petitioner, and considering other local circumstances, the Bureau granted Petitioner's request for waiver. In doing so the Bureau granted a 36-month waiver for seven of Petitioner's cable television systems, and a 12-month waiver for Petitioner's systems located at Ackerman and Bude, Mississippi. Since that time, Petitioner has installed compliant EAS systems in five headend communities: Isola, Louise, Warren County, Ackerman and Bude, Mississippi. As set forth below, circumstances exist wherein EAS-comp1iant technology compatible with Petitioner's cable television system facilities is still not yet commercially available to the four named systems at a financially reasonable expense, and none is foreseen to be available by October 1,2005. Installation at current prices threatens the financial viability ofthe four systems, and would result in stranded investment, given Petitioner's plans for headend consolidation. Forthe reasons shown herein, Petitioner requests further waiver ofthe EAS requirements attendant to Petitioner's cable television headend systems at Crosby, New Augusta, New Hebron and Roxie, Mississippi. As demonstrated Jj See, Order in The Matter a/Branch Cable, Inc., File No. EB-02-TS-069, released June 24, 2002 ("Branch Order"), wherein 36-month waivers were granted for Petitioner's headend systems in Crosby, Isola, Louise, New Augusta, New Hebron, Roxie and Warren County, Mississippi, and 12-month waivers were granted for Petitioner's headend systems in Ackennan and Bude, Mississippi, 3 herein, good cause exists for grant ofa further waiver. Y Further Waiver Is Justified by Continued Financial Hardship and Planned Facility Modifications In the Branch Order and elsewhere the Bureau has restated its commitment to grant waivers ofthe EAS rules to small cable systems on a case-by-casebasis upon a showingoffinancial hardship. The Commission recognized that smaller systems do not have access to the financial resources, purchasing discounts and other efficiencies oflarger companies .. In the Second Report andOrder, at ~20, the Commission stated, "Finally, we note that there is potential for financial hardship for small cable systems even with an extended phase-in period. Therefore, we will continue to provide waivers on a case-by-case basis." Indeed, Petitioner finds that EAS implementation endures as an economic burden for the Crosby, New Augusta, New Hebron and Roxie cable television systems. Since release ofthe Branch Order Petitioner has continued its detailed review ofequipment vendors' proposals for providingsubscribers with EAS messages and interrupts. Petitionerhas finished installing EAS systems where costs relative to subscribership warrant the expenditure. Costs of installation have ranged from $6,520 to $6,877 per headend system. The latestquote from Petitioner's EAS supplier is $7,742 per headend, which, while higher than quotes from other vendors, offers to Petitioner the advantages of 1) a weekly testing feature, 2) minimizing inventory ofspare parts, and 3) avoidance ofduplicate training ofEAS personnel on the operation, testing and protocols oftwo "The Commission may exercise its discretion to waive a rule where particular facts would make strict compliance in consistent with the public interest." WAIT Radio v. FCC, 418 F.2d 1153, 1159 (D,c. Cir. 1969) Waiver of a Commission rule is appropriate where (l) the underlying purpose ofthe rule will not be served, or would be frustrated, by its application in a particular case, and grant ofthe waiver is otherwise in the public interest, or (2) unique facts or circumstances render application of the rule inequitable, unduly burdensome or otherwise contrary to the public interest, and there is no reasonable alternative. 4 different systems. Despite Petitioner's diligent efforts to acquire EAS systems for the four remaining systems, the prospects remain economically untenable. The very lowest prices found by Petitioner are as follows: Lowest Headend Number of Quoted Cost per Community Subscribers EAS Costs Subscriber Crosby 91 $3,869 $42..52 New Augusta 112 $4,266 $3809 New Hebron 96 $4,266 $44044 Roxie 115 $4,266 $37,10 These quotes are for equipment acquisition only. They do not include accessories, installation or financing .. Because these lowest quotes are from a vendor other than the vendor of Petitioner's installed EAS systems, Petitioner would incur additional costs for spare parts, training and testing. Petitioner has been unsuccessful in obtaining funds for EAS from commercial sources because of leverage restrictions that continue to be placed upon Petitioner by existing lenders. As mentioned in the Branch Order, it was hoped that FCC-certified decoder-onlyunits would offer a lower cost means ofsmall system EAS compliance. To date, however, Petitioner has located no economically practical FCC-certified decoder-only units available on the market Petitioner inquired with the decoder-onlyvendors listed on the FCC'swebsite and others. The quotes it received for decoder-only units were generally about $400 less than those for encoder/decoder equipment, but the $400 savings would be more than lost again because Petitioner would have to replace multiple modulators in order to use the decoder-only equipment Therefore EAS vendors have consistently 5 recommended that Petitioner pay the extra $400 and purchase encoder/decoder equipment. At the same time, Petitioner has embarked on a plan to consolidate headends and install new broadband facilities. The program began in late 2003 and is projected to proceed through 2008.¥ Upon completion, Petitioner will have consolidated nine headends into one, resulting in improved services, increased capacity and lower costs for subscribers. Due to the impendingdeactivation ofeach headend at Crosby, New Augusta, New Hebron and Roxie, installation ofEAS at each headend prior to consolidation will result in wasted investment in duplicate systems that will be of no further use. Petitioner finds that to acquire and operate stand-alone EAS systems for temporary use at Crosby,New Augusta, New Hebron and Roxie at currentquoted costs would befinancially imprudent and costly to its subscribers. Spread over two years, for example, subscriber rates for equipment purchase alone at the Crosby system would have to be raised by about $1.77 per month, which is a 72% increase; rates at the New Augusta system would increase by $1.59 per month (5.7%); rates at the New Hebron system would increase by $1.85 per month (6.7%), and rates at the Roxie system would increase by $1 .55 per month (5.7%). These figures demonstrate that the cost ofEAS, totaling $16,667, is too great a burden to place upon subscribers or upon Petitioner, whose entire operation cumulatively produced less than $46,000 income in year 2004, andjust over $31 ,000 income in year 2003. Petitioner's audited adjusted income statement and balance sheet for years 2003 and 2004 are attached hereto. Petitionerwould bejeopardized by enforcement ofthe EAS implementation requirements for ¥ Petitioner plans to install fiber-to-the-home and/or rebuild Digital Subscriber Line facilities in Roxie and then consolidate the Roxie headend into the Bude/Meadville headend. Sequentially, Petitionerplans to do the same with facilities in Crosby, New Augusta and New Hebron. Eventually all ofPetitioner's headends will beconsolidated into the Bude/Meadville location. 6 Crosby, New Augusta, New Hebron and Roxie by October I, 2005. Petitioner's subscribers do not have the means to
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