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Executive Summary FRC's Review of Comcast's Formal Renewal --Proposal toprovide the services, facilities, and equipment as set forth in the operator's proposal; and (®) the operator's proposal is reasonable to meet the future cable -related community needs and interests, taking into account the cost of meeting such needs and interests. FRC primarily focused on subsection (®) above where the proposal needs to be evaluated "taking into account the cost of meeting such needs and interests." The legislative history provides further insights to this "cost" standard where it states "'[i]n assessing the costs, the cable operator's ability.to earn a fair rate of return on its investment and the impact of such costs on subscriber rates are important consideration s.i2The RFRP contained numerous requirements to address the costs of the identified needs and interest with respect to the financial impact on Comcast and the impact on subscriber rates.3 Issues Identification FRC has identified five issues with the Proposal. Those issues are: Complete lack of any financial projections to compare the RFRP requirements to the potential earnings by Comcast and the impact on subscriber rates in the NSCC franchise area. Lack of any recognition and financial credit that the current I -Net construction costs have been fully and completely paid for by NSCC subscribers. Lack of any recognition that Comcast has improperly recaptured valuable analog spectrum from the NSCC and will be able to use that recaptured spectrum for its own money -making purposes without compensation to the NSCC and the subscribers. Comcast has proposed that the NSAC be required to use its reasonable reserves accumulated by the NSAC to cover future NSAC operating and capital requirements that will place the NSAC in an exposed financial position which could potentially lead to a financial collapse of the NSAC. Comcast repeatedly complains that operating support cannot be required by the NSCC/NSAC but fails to acknowledge that the Cable Act allows the cable operator to voluntarily offer operating support. Given the public support for the NSAC's programming, Comcast should have volunteered to pay operating support to the NSAC as part of its proposal. In a recent development, Comcast has agreed to extend a 2 See H.R. REP. No. 98-934, at 74 (1984), as reprinted in 1984 U.S.C.C.A.N. 4655, 4656. 3 See e.g., RFRP Form III.F. © Front Range Consulting, Inc. Page 2