CABLE TV CUSTOMERS TO GET RATE CUTS

Watching cable television soon will be a bit easier on the pocketbook.

Cape Girardeau and Jackson cable television customers will pay a little less for most services as a result of government regulations designed to put the brakes on cable charges.

The rate changes take effect July 14, said Roger Harms, general manager for TCI Cablevision's Cape Girardeau and Jackson operations.

The monthly rate for basic service will decrease by more than a dollar, from $10.23 to $9.17. After a 5 percent franchise fee is factored in, the total cost for basic service will be $9.63, said Harms.

Expanded basic service will increase by 35 cents, from $10.23 to $10.58, not counting the franchise fee.

But when the basic service rate cut is factored in, the net result for customers with expanded basic service will be a 71-cent rate reduction on their monthly bill, Harms said Thursday.

Basic service involves programming on channels 3 through 20, including the over-the-air channels and super stations like WGN and TBS.

Expanded basic service encompasses channels 21 through 36. TNT and ESPN are among channels offered in this category.

Customers will pay $1.32 a month for the standard converter box, a 25-cent decrease from what they now pay. Customers will see a 2-cent-a-month savings on the renting of a remote control. Installation costs also will be lower, Harms said.

The cable company is in the process of notifying customers of the rate changes.

Harms said the rate cuts are "a bargain" for TCI customers, but a concern to company executives who must look at how to make up the lost revenue.

"For a system our size, we are going to take a pretty big hit," said Harms, referring strictly to the local operation, which has about 13,000 subscribers. TCI, based in Denver, operates numerous cable systems across the country including this one.

The cable operation locally stands to lose thousands of dollars from the cut in the basic service rate alone, he said.

But Michael Maguire, chairman of Cape Girardeau's cable committee, doesn't think most consumers will feel sorry for the cable firm.

"TCI, like most franchises in most communities, is effectively a monopoly," said Maguire.

Rate hikes since 1986 have greatly outstripped inflation, he said.

"Some of the things that are being decreased in cost are items that didn't used to be charged at all," pointed out Maguire. The 1992 cable law led companies to set charges for every service, he explained.

"Now that it is getting rolled back, i can't see that it will break their backs," Maguire said.

Local cable customers would benefit from competition in the cable industry, he said. If TCI had to compete with another company to provide cable service here, the result would be competitive prices, he said.

Even with the federal cable law, cities have little real power to regulate cable companies, Maguire said.

Warren Wells, Cape Girardeau city attorney, said the city has limited regulatory power over rates, and it's restricted to just the basic tier of service.

Harms said Federal Communications Commission regulations growing out of the 1992 Federal Cable Act are responsible for the rate reductions. The FCC has said that the rates charged by 90 percent of the nation's cable systems will drop an average of 7 percent.

Harms said the new rates are calculated on the basis of a complex formula, which even includes the average income in the area.

"We had a staff of CPAs in our division office working around the clock just to even get these rates," said Harms. "There was a lot of information that went into this formula to figure it out."

Harms said the announced rate reductions will only affect cable customers in Cape Girardeau and Jackson. Those who live in the out-county where cable service is currently not regulated by local government won't see lower charges at this time.

He estimated that only about 1,000 of the cable customers live outside the two cities. Ultimately, he said, a rate adjustment of some sort is likely for those customers. "We are going to address that, but I can't say which way we will go."

Harms said it's more expensive to run cable lines in the county and make service calls.

Despite the rate reductions, cable customers can expect to see their bills increase in the future. Under FCC regulations, cable companies will be able to adjust their rates quarterly to keep up with cost-of-living increases, Harms said.

Harms and Wells said that negotiations are continuing to hammer out a new franchise agreement.

TCI has been operating under the old agreement through a series of extensions granted by the council over the past couple of years. Last month the council granted a 45-day extension.

Harms and Wells said a new agreement could be worked out by the end of this latest extension, set to expire near the end of the month. "We feel like we are on the homeward stretch," said Harms.

Wells said TCI plans to present him with the latest draft of the agreement, which could be discussed with the city council as early as next week.

Wells, however, refused to speculate on when a new franchise agreement might be finalized. "I am not putting any deadline on it. We are going to take as long as it takes.

"It is a matter of negotiation," said Wells. "The city doesn't have the authority to dictate to the cable company what they will do."

CABLE RATES FALL SLIGHTLY

What?

Cable bills will drop charges will change in Cape Girardeau and Jackson.

When?

New rates take effect July 14

How much?

Monthly fee for basic service will drop from $10.23 to $9.17.

Expanded basic will increase 35 cents, from $10.23 to $10.58.

Net result will be 71 cent reduction for customers with both services.