TR Daily Pai, Rosenworcel Spar Over Fee Framework NPRM
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Wednesday, August 26, 2020

Pai, Rosenworcel Spar Over Fee Framework NPRM

The FCC released a notice of proposed rulemaking today soliciting views “on a new application fee schedule proposing significant changes to the Commission’s existing fee schedule in both types of applications and other processes covered by the fee requirement and also in the amount of fees proposed.”

Democratic Commissioners Jessica Rosenworcel and Geoffrey Starks approved in part and dissented in part on the item, and Ms. Rosenworcel released a statement. FCC Chairman Ajit Pai accused Ms. Rosenworcel of making “’blatantly false’ claims for political purposes.”

The item in MD docket 20-270 said, “The new fee schedule and proposed fees impact stakeholders in every industry overseen by the Commission. The new and revised fees apply to a broad spectrum of filings processed by the Commission including applications, modifications, and renewals of wireless, television and satellite licenses, applications to participate in auctions to tariff filings, formal complaints and certain petitions.”

The “changes we initiate today derive from modifications to the Commission’s statutory application fee authority made by the RAY BAUM’S Act of 2018,” the agency said. “The current application fee framework was established more than 30 years ago by Congress. While accurate at the time, the framework did not allow the fee schedule to change as a result of advancements in technology and corresponding changes in Commission procedures and rules. Notably, the Commission was constrained from adding, removing, or otherwise changing the structure or levels of our application fees prior to the RAY BAUM’S Act, outside of a ministerial biannual review to determine, based on a statutory threshold, whether the fee rate should be revised to reflect changes in the Consumer Price Index.

“This rulemaking provides an opportunity to bring this set of fees into the 21st century by lowering fees to account for processing efficiencies where appropriate, adding new fees for applications that were implemented after the original fee schedule was adopted, and eliminating fees for applications that no longer exist,” the FCC said. “The actions we propose today will simplify and streamline an overly complex schedule of fees by proposing significant fee consolidation in matters overseen by both the Wireless Telecommunications Bureau and the International Bureau. In this Notice, we also adopt several amendments to our rules to conform with the revised text of the Communications Act, as amended by the RAY BAUM’S Act.”

“We are seeking comment on consolidating the application fees assessed on licenses for wireless services—instead of separate application fees for each application in each wireless service, we are proposing to consolidate the application fees into site-based licenses, personal licenses, and geographic-based licenses,” the item added. “We seek comment on consolidating some of the application fees for licenses from the Media Bureau and removing some Media Bureau applications from the fee schedule. In addition, we are seeking comment on new application fees for certain applications in the Wireline Competition Bureau that currently do not have fees. For applications for international services, we are proposing to consolidate some of the application fees for space stations and earth stations. We also propose new application fees for some international services, such as petitions for United States market access for foreign space stations. For all of the proposed fees, we are including estimates of the Commission’s costs in processing the applications. We seek comment on the estimates and whether we have included the appropriate steps in processing the application in estimating the costs. In making our proposals here, however, we remind commenters that our section 8 authority is distinct from the Commission’s authority with respect to other collections.”

Comments on the item are due 30 days after “Federal Register” publication and replies are due 15 days after that.

In her statement, Ms. Rosenworcel said, “In the RAY BAUM’s Act Congress sought to modernize the fee structure for services performed by the Federal Communications Commission. It did so by deleting outdated statutory language in our existing fee framework and directing the agency to update its application fees to better reflect the current state of communications services. This rulemaking gets the updating process going by seeking comment on specific proposals to revamp the agency’s application fee structure. I broadly support this effort. After all, this undertaking is compelled by statute. Moreover, it thoughtfully proposes streamlining our schedule of application fees, consolidating the eight separate categories of fees presently in our rules into five functional categories. In addition, it clearly states that its goals in doing so are to ensure any new fee structure is administrable, sustainable—and fair.

“But in one respect this proposal is definitely not fair. Not even close,” she complained. “At a time when a public health emergency has crashed our economy, with unemployment at record-high levels, and with so many now compelled to go online for so much of modern life, the FCC proposes a dramatic increase in the cost of filing a formal consumer complaint. This is crazy. It shows a wild disregard for the financial insecurity of so many households. By proposing to more than double the cost of a filing—from $235 to $540—the agency is demonstrating contempt for consumers looking to us for assistance when they have disputes related to their communications bills, difficulties securing service, or problems with their providers. Worse, it is deterring them from seeking our help in the first place. This is shameful. In this respect, I dissent.”

In his own statement, Mr. Pai ripped Ms. Rosenworcel.

“For the first time in more than 30 years, the Commission is proposing to update its framework for assessing and collecting application fees. Congress recently granted us that authority in the RAY BAUM’S Act, but it limited our discretion in setting such fees—we must impose fees on all ‘applications,’ and we must set those fees at a level which allows us to ‘recover the costs of the Commission to process applications.’ The Commission proposes to interpret those provisions in a manner as friendly to consumers and applicants as permissible under the law,” he said. “One might think that a pro-consumer approach consistent with the law would garner unanimous support. Sigh. One of my colleagues dissents because of a purported concern that the Notice is ‘proposing to more than double the cost of a filing’ [of] a formal complaint, claiming that such a proposal would impact ‘consumers.’ This is absurd.

“First, the argument that this proposal would harm consumers is factually wrong. That’s because the formal complaint process (which imposes a trial-like process to adjudicate a dispute) isn’t designed for or used by consumers,” Mr. Pai added. “The number of formal complaints filed by consumers in 2019? Zero. And so far in 2020? Zero. In contrast, consumers rely on our informal complaint process—300,000 in 2019 and 174,000 so far in 2020—which successfully resolves many problems without hassle. And what’s the fee we propose for such actual consumer complaints? Zero (specifically, we propose to find that ‘informal consumer complaints are not applications’). In other words, in the real world, there is literally no impact of this formal complaint fee on consumers.

“Second, the argument that we should not adjust this application fee demonstrates contempt for the Law,” Mr. Pai argued. “After all, ‘this undertaking is compelled by statute.’ And it was Congress that mandated how we calculate those fees. Indeed, we propose to exercise the little discretion we have to limit the ‘costs’ we consider to only ‘direct costs,’ resulting in a lower fee to applicants than the alternatives. So how, then, does the dissent suggest that we calculate a new application fee for formal complaints?”

“Third and finally, a few words on process. The Commission has a long tradition of bipartisan collaboration, and so my office has repeatedly agreed to amend items (especially Notices of Proposed Rulemaking) at the request of other offices. But there’s a catch. To accommodate a Commissioner’s concerns, our staff must know about those concerns before the item is voted,” Mr. Pai said. “And yet, on July 2, when the Office of the Managing Director circulated this item, my colleague did not say a thing, much less request any edits.”

He said Ms. Rosenworcel requested additional time on Aug. 5 and indicated in the voting system on Aug. 12 that she would be dissenting in part.

Mr. Pai said that “despite repeated requests from my office and FCC staff for feedback throughout the seven-plus weeks of this process, the first we learned about the purported concern was on August 21—through the dissenting statement and well after the votes were cast. If my colleague actually believed the hyperbolic claims set forth in her statement yet made no effort to change the Notice for the better, there’s a word that comes to mind: shameful. But of course that’s not what’s going on here. This is just another attempt to make ‘blatantly false’ claims for political purposes. In any case, going forward, my staff and I will continue to search for ways to address issues that are never raised with us and that we’re thus unaware of, given this recurring issue.” —Paul Kirby, [email protected]

MainStory: FCC FederalNews

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