TR Daily FCC Adopts 2018 Reg Fees, Amends Debt Collection Rules
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Wednesday, August 29, 2018

FCC Adopts 2018 Reg Fees, Amends Debt Collection Rules

The FCC has adopted a schedule to assess and collect $322 million in regulatory fees for fiscal year 2018 and has amended its rules to end the assessment of administrative costs that it incurs in collecting delinquent regulatory and application fee debts or related penalties, as required by the RAY BAUM’S Act passed earlier this year.

The rule change regarding debt collection will take effect Oct. 1, the FCC said in the report and order adopted yesterday and released today in Managing Director docket 18-175.

Of the $322,035,000 in regulatory fees to be assessed, the FCC projects “approximately $20.3 million (6.25 percent of the total FTE [full time employee] allocation) in fees from the International Bureau regulatees; $84.7 million (26.3 percent of the total FTE allocation) in fees from the Wireless Telecommunications Bureau regulatees; $103.99 million (32.29 percent of the total FTE allocation) in fees from the Wireline Competition Bureau regulatees; and $113.22 million (35.16 percent of the total FTE allocation) in fees from the Media Bureau regulatees. These regulatory fees are due in September 2018.”

Among the changes in its assessment formulas adopted for FY2018 are an increase in the Media Bureau–based regulatory fee for DBS (direct broadcast satellite) that began in FY2015 at 12 cents per subscriber per year and reached 38 cents per subscriber per year in FY2017. For FY2018, the DBS fee will be 48 cents per subscriber per year.

“Although a common pool of FTEs work on MVPD and related issues for DBS operators, IPTV providers, and cable TV systems, which some commenters argue justifies immediate parity in regulatory fees across these providers, we believe it prudent to adopt our proposal to increase such rates by less than one cent per subscriber per month, or 10 cents per subscriber per year. Doing so reflects the statutory imperative to take into account the FTEs devoted to oversight of this common category of regulatees, ‘adjusted to take into account factors that are reasonably related to the benefits provided to the payor of the fee by the Commission’s activities, including . . . factors that the Commission determines are necessary in the public interest,’ such as our concern to mitigate the impact of increases on MVPDs should we move to immediate parity (which a regulatory fee of 67 cents per subscriber per year would achieve),” the FCC explained in the order.

Regarding fees assessed on terrestrial and satellite international bearer circuits, the order adopts a correction to the proposals in the notice of proposed rulemaking (NPRM) issued in May. “CenturyLink observes that the proposed rate of $0.02 per circuit in Appendix B to the FY 2018 NPRM used 64 kbps (kilobits per second) instead of Gbps (gigabits per second). We agree with CenturyLink that the measurement listed in the FY 2018 NPRM should have been Gbps instead of 64 kbps, and we are therefore adopting the proposed per-circuit fee of $176, using Gbps, in lieu of 64 kbps. No commenter opposed this proposal,” the FCC said.

Regarding fees assessed on broadcast television stations, the order looks ahead to FY2019.

“In the FY 2018 NPRM, we sought comment on whether we could more accurately ascertain the actual market served by a station for purposes of assessing regulatory fees by examining the actual population covered by the station’s contours rather than using DMAs. Specifically we sought comment on whether, for FY 2019 and going forward, regulatory fees should be assessed for full-power broadcast television stations based on the population covered by the station’s contour, instead of DMAs. No commenter opposed this proposal. In the FY 2018 NPRM, we also sought comment on whether to phase in the implementation of this methodology over a two-year, or longer, period of time. In order to facilitate the transition to this new fee structure, for FY 2019, we plan to adopt a fee based on an average of the current DMA methodology and the population covered by a full-power broadcast station’s contour. Thereafter, in 2020, we plan to assess regulatory fees for full-power broadcast stations based on the population covered by the station’s contour. Such an approach is consistent with the methodology used for AM and FM broadcasters, in which fees are based on population served and the class of service based on the signal contours. In addition, this approach addresses concerns about the assessment of regulatory fees on broadcast television satellite stations serving small markets at the fringe of larger DMAs. The population data for broadcasters’ service areas will be extracted annually from the TVStudy database, based on a station’s projected noise-limited service contour, consistent with our rules, and we will enable broadcasters to review population data for their service area in our annual regulatory fee NPRM. We will multiply the population by a factor for which we will seek comment in the annual regulatory fee NPRM, e.g., 0.63 cents ($.0063),” the FCC said.

It added, however, that “[t]he adoption of these methodologies for assessing regulatory fees for broadcast television stations is a permitted amendment as defined in section 9(b)(3) of the Act, and pursuant to section 9(b)(4)(B), it must be submitted to Congress at least 90 days before it would become effective. Therefore, for FY 2018, we will assess regulatory fees for all broadcast television stations using the same methodology as we did for FY 2017.” —Lynn Stanton, [email protected]

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