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FCC Releases 2014 Regulatory Fee Proposals

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With the heat of Summer now upon us, the FCC is gearing up for its annual regulatory fee filing window, which usually occurs in mid-September. Like other federal agencies, the FCC must raise funds to pay for its operations (“to recover the costs of… enforcement activities, policy and rulemaking activities, user information services, and international activities.”). For Fiscal Year 2014, Congress has, for the third year in a row, mandated that the FCC collect $339,844,000.00 from its regulatees.

Accordingly, the FCC is now tasked with determining how to meet the Congressional mandate. At its most basic level, the FCC employs a formula that breaks down the cost of its employees by “core” bureaus, taking into consideration which employees are considered “direct” (working for one of the four core bureaus), or “indirect” (working for other divisions, including but not limited to, the Enforcement Bureau and the Chairman’s and Commissioners’ offices). The FCC factors in the number of regulatees serviced by each division, and then determines how much each regulatee is obligated to pay so that the FCC can collect the $339M total.

In its quest to meet the annual congressional mandate, the FCC evaluates and, for various reasons, tweaks the definitions or qualifications of its regulatee categories to, most often, increase certain regulatory fee obligations. FY 2014 is just such an occasion. In FY 2013, the FCC, which historically has imposed drastically different fees for VHF and UHF television licensees, decided that, effective this year, FY 2014, VHF and UHF stations would be required to pay the same regulatory fees. In addition, a new class of contributing regulatees, providers of Internet Protocol TV (“IPTV”), was established and is now subject to the same regulatory fees levied upon cable television providers. Prior to FY 2014, IPTV providers were not subject to regulatory fees.

The FCC’s proposals for FY 2014 regulatory fees can be found in its Order and Second NPRM (“Order”). In that Order, the FCC proposes the following FY 2014 commercial VHF/UHF digital TV regulatory fees:

  • Markets 1-10 – $44,875
  • Markets 11-25 – $42,300
  • Markets 26-50 – $27,100
  • Markets 51-100 – $15,675
  • Remaining Markets – $4,775
  • Construction Permits – $4,775

Other proposed TV regulatory fees include:

  • Satellite Television Stations (All Markets) – $1,550
  • Construction Permits for Satellite Television Stations – $1,325
  • Low Power TV, Class A TV, TV Translators & Boosters – $410
  • Broadcast Auxiliaries – $10
  • Earth Stations – $245

The proposed radio fees depend on both the class of station and size of population served. For AM Class A stations:

  • With a population less than or equal to 25,000 – $775
  • With a population from 25,001-75,000 – $1,550
  • With a population from 75,001-150,000 – $2,325
  • With a population from 150,001-500,000 – $3,475
  • With a population from 500,001-1,200,000 – $5,025
  • With a population from 1,200,001-3,000,000 – $7,750
  • With a population greater than 3,000,000 – $9,300

For AM Class B stations:

  • With a population less than or equal to 25,000 – $645
  • With a population from 25,001-75,000 – $1,300
  • With a population from 75,001-150,000 – $1,625
  • With a population from 150,001-500,000 – $2,750
  • With a population from 500,001-1,200,000 – $4,225
  • With a population from 1,200,001-3,000,000 – $6,500
  • With a population greater than 3,000,000 – $7,800

For AM Class C stations:

  • With a population less than or equal to 25,000 – $590
  • With a population from 25,001-75,000 – $900
  • With a population from 75,001-150,000 – $1,200
  • With a population from 150,001-500,000 – $1,800
  • With a population from 500,001-1,200,000 – $3,000
  • With a population from 1,200,001-3,000,000 – $4,500
  • With a population greater than 3,000,000 – $5,700

For AM Class D stations:

  • With a population less than or equal to 25,000 – $670
  • With a population from 25,001-75,000 – $1,000
  • With a population from 75,001-150,000 – $1,675
  • With a population from 150,001-500,000 – $2,025
  • With a population from 500,001-1,200,000 – $3,375
  • With a population from 1,200,001-3,000,000 – $5,400
  • With a population greater than 3,000,000 – $6,750

For FM Classes A, B1 &C3 stations:

  • With a population less than or equal to 25,000 – $750
  • With a population from 25,001-75,000 – $1,500
  • With a population from 75,001-150,000 – $2,050
  • With a population from 150,001-500,000 – $3,175
  • With a population from 500,001-1,200,000 – $5,050
  • With a population from 1,200,001-3,000,000 – $8,250
  • With a population greater than 3,000,000 – $10,500

For FM Classes B, C, C0, C1 & C2 stations:

  • With a population less than or equal to 25,000 – $925
  • With a population from 25,001-75,000 – $1,625
  • With a population from 75,001-150,000 – $3,000
  • With a population from 150,001-500,000 – $3,925
  • With a population from 500,001-1,200,000 – $5,775
  • With a population from 1,200,001-3,000,000 – $9,250
  • With a population greater than 3,000,000 – $12,025

In addition to seeking comment on the proposed fee amounts, the Order seeks comment on proposed changes to the FCC’s basic fee formula (i.e., changes in how it determines the allocation of direct and indirect employees and thus establishes its categorical fees), and on the creation of new, and the combination of existing, fee categories. The Order also seeks comment on previously proposed core bureau allocations, the FCC’s intention to levy regulatory fees on AM Expanded Band Radio Station licensees (which have historically been exempt from regulatory fees), and whether the FCC should implement a cap on 2014 fee increases for each category of regulatee at, for example, 7.5% or 10% above last year’s fees. Comments are due by July 7, 2014 and Reply Comments are due by July 14, 2014.