Sec. 76.961  Refunds.

    (a) Upon a finding that a rate for cable programming service or 
associated equipment is unreasonable, the Commission may order the cable 
operator to refund to subscribers that portion of previously paid rates 
which is deemed unreasonable.

[[Page 604]]

    (b) The cumulative refund due subscribers shall be calculated from 
the date a valid complaint is filed until the date a cable operator 
implements a prospective rate reduction as ordered by the Commission 
pursuant to Sec. 76.960. The Commission shall calculate refund liability 
according to the rules in effect for determining the reasonableness of 
the rates for the period of time covered by the complaint.
    (c) The cable operator, in its discretion, may implement a refund in 
the following manner:
    (1) By returning overcharges to those subscribers who actually paid 
the overcharges, either through direct payment or as a specifically 
identified, one-time credit to those subscribers' bills; or
    (2) By means of a prospective percentage reduction in the 
unreasonable cable programming service rate or equipment charge to cover 
the cumulative overcharge. This shall be reflected as a specifically 
identified, one-time credit on prospective bills to the class of 
subscribers that currently subscribe to the cable programming service or 
associated equipment at issue.
    (d) Refunds shall include interest computed at applicable rates 
published by the Internal Revenue Service for tax refunds and additional 
tax payments. Interest shall accrue from the date a valid complaint is 
filed until the refund issues.
    (e) At the time the Commission orders a cable operator to pay 
refunds to subscribers, the franchising authority must return to the 
cable operator an amount equal to that portion of the franchise fee that 
was paid on the total amount of the refund to subscribers. The 
franchising authority may return the franchise fee overcharge either in 
an immediate lump sum payment, or the cable operator may deduct it from 
the cable system's future franchise fee payments.

[ 58 FR 29753 , May 21, 1993, as amended at  59 FR 17975 , Apr. 15, 1994]