Articles Posted in Fees

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Pillsbury’s communications lawyers have published FCC Enforcement Monitor monthly since 1999 to inform our clients of notable FCC enforcement actions against FCC license holders and others.  This month’s issue includes:

  • Violations of the Live Broadcasting Rule Lead to $50,000 Consent Decree
  • Decision Affirming Dismissal of Mississippi Station’s License Renewal Application Highlights Intricacies of License Renewal Process
  • FCC Reversal Leads to Reinstatement of Georgia Radio Station’s License

Is This Live?  California Broadcaster Settles with FCC Over Violations of the Live Broadcasting Rule

The FCC recently entered into a Consent Decree with a large California-based radio broadcaster for violating the FCC’s rule prohibiting the broadcast of prerecorded programming that “creates the impression that it is occurring live” (often referred to as the “live broadcasting rule”).  This settlement represents the first time the FCC has publicly enforced the rule in recent years.

According to the FCC, the live broadcasting rule is effectively a consumer protection rule that ensures viewers are not misled into believing that a program is live when it is not.  Under Section 73.1208 of the FCC’s Rules, where “time is of special significance” to the program material aired, or “an affirmative attempt is made to create the impression that [the program material] is occurring simultaneously with the broadcast,” broadcasters must disclose if the program was previously taped, filmed, or recorded.  Such disclosure must be made at the beginning of the broadcast “in terms commonly understood by the public”.  The live broadcasting rule does not extend to prerecorded commercial, promotional, or public service programming.

The FCC began its investigation after receiving a complaint alleging that one of the broadcaster’s Los Angeles-area AM stations was airing a call-in show with the word “Live” in its title even though the show was actually prerecorded.  The FCC’s Enforcement Bureau responded by directing a Letter of Inquiry to the station’s licensee seeking additional information about the program.  In response, the licensee admitted the broadcast had indeed been prerecorded and that at several times during the broadcast, the program’s host had suggested that he was taking listener calls live over the air.  The licensee acknowledged that even though the program created the impression that the broadcast was live, the station under investigation, as well as other commonly-controlled stations that broadcast the same program, had failed to make the required disclaimer.

To resolve the investigation, the licensee’s parent company entered into a Consent Decree with the Enforcement Bureau.  Under the terms of that agreement, the company: (1) agreed to pay a $50,000 civil penalty; (2) admitted to violating the live broadcasting rule; and (3) must implement a three-year compliance plan to prevent future violations.  Considering the costly penalty, broadcasters should be wary when airing prerecorded programming, taking care to determine whether the audience needs to be informed of that fact.

Undisclosed Death of Mississippi Radio Station Owner Ends in Non-Renewal of License

In a recent Memorandum Opinion and Order (“Order”), the FCC denied an Application for Review which challenged the dismissal of a Mississippi AM station’s 2012 license renewal application.  The application had failed to disclose that the station’s licensee had previously died, and unsurprisingly, also failed to include the deceased licensee’s signature.

The years-long saga began in January 2011 following the death of the station’s licensee.  Continue reading →

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Pillsbury’s communications lawyers have published FCC Enforcement Monitor monthly since 1999 to inform our clients of notable FCC enforcement actions against FCC license holders and others.  This month’s issue includes:

  • Arkansas University’s Underwriting Violations Lead to $76,000 Consent Decree
  • Large TV Broadcaster Agrees to Pay $1.3 Million Over Predecessor’s Tower Compliance Problems
  • Recent Fine Cancellations Prompt Broadcasters to Double-Check Fees and Fines

A Word From Our Sponsors: Arkansas University Settles With FCC Over Underwriting Violations

The FCC recently entered into a Consent Decree with an Arkansas university for violating the FCC’s underwriting rules for noncommercial stations.  The university admitted that two of its FM stations aired announcements over several days in 2016 that impermissibly promoted the products or services of its financial contributors.  The two stations are operated by a community college under the University’s control.

Noncommercial educational (“NCE”) broadcast stations are prohibited from airing promotional announcements on behalf of for-profit entities in exchange for any benefit or payment.  Instead, NCE stations may broadcast announcements that identify but do not “promote” station benefactors.  Such messages may not, among other things, include product descriptions, price comparisons, or calls to action on behalf of a for-profit donor.  According to the FCC, these limitations “protect the public’s use and enjoyment of commercial-free broadcasts” and “provide a level playing field for the noncommercial broadcasters that obey the law and for the commercial broadcasters that are entitled to seek revenue from advertising.”

The FCC was tipped off to the violations when the licensees of several nearby commonly-owned stations filed a Formal Complaint outlining over a dozen announcements broadcast on the University’s stations.  The complainants alleged that these messages, which were aired on an ongoing basis in 2016, violated the underwriting rules by either including promotional statements or promoting specific products for sale.  Most of the announcements were sponsored by local businesses, including an announcement for a nearby car dealership described as “impressive with a very clean pre-owned model or program unit,” a furniture store that has a “good deal … going there” where listeners can get “pretty stuff,” and a local insurance agent offering services that he had “never done on radio before.”

The Enforcement Bureau responded to the Formal Complaint by issuing multiple Letters of Inquiry to the University seeking additional information about the announcements and the University’s underwriting compliance efforts.  In its response, the University admitted that the announcements had been simulcast on both stations, but emphasized that the stations’ staff had received “extensive” training on underwriting issues, and that it believed that the stations had complied with the underwriting rules.

To resolve the years-long investigation, the University agreed to enter into a Consent Decree under which the University agreed to: (1) pay a $76,000 civil penalty; (2) admit to violating the FCC’s underwriting rules; and (3) implement a five-year compliance plan to ensure there will be no future violations.

Tower Records: Predecessor’s Lax Oversight of Antenna Structures Leads to $1.3 Million Settlement for Large Broadcast Company

A large television broadcast company has agreed to settle an FCC investigation into whether the prior owner of several of the company’s towers failed to sufficiently monitor and maintain records regarding them.

Part 17 of the FCC’s Rules requires a tower owner to comply with various registration, lighting and painting requirements.  Tower marking and lighting is a vital component of air traffic safety, and noncompliant structures pose serious hazards to air navigation.  To this end, a tower owner is responsible for observing the tower at least once every day for any lighting failures or to have in place an automatic monitoring system to detect such failures.  The tower owner must also maintain a record of any extinguished or improperly functioning lights.  The FCC’s rules also require a tower owner to notify the FCC within 5 days of a change in a tower’s ownership.

In September 2018, a small plane crashed into a southern Louisiana broadcast tower, prompting an FCC investigation into the tower and its owner.  The FCC determined that the tower was registered to a subsidiary of a national broadcaster which at the time controlled over a dozen television stations and related antenna structures.  Following up on the crash, the Enforcement Bureau issued the company a Letter of Inquiry seeking information about its compliance with the FCC’s tower rules.  The company responded by disclosing numerous “irregularities” in its monitoring of the lighting systems of the toppled tower and nine other towers.  It also disclosed that it had failed to keep complete records of a dozen lighting failures at several of its towers, and that it had not notified the Commission of its acquisition of two other towers. Continue reading →

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The FCC has released its finalized schedule of annual Regulatory Fees for Fiscal Year 2019, and thanks to the collective efforts of all 50 State Broadcasters Associations and the National Association of Broadcasters, there is some good news for radio stations and satellite television stations.

But before we get to that, some information for you from the FCC’s Public Notice released today on filing requirements.  Fees will be due by 11:59 p.m. EDT on September 24, 2019.  You must file via the FCC’s Fee Filer system, which is available for use now.  You may pay online via credit card or debit card, or submit payment via Automated Clearing House (ACH) or wire transfer.  Remember that $24,999.99 is the daily maximum that can be charged to a credit card in the Fee Filer system.  As a result, many stations may have to pay their fees using the other methods.

Television broadcast stations will see an unfamiliar number in the “Quantity” box when they go to pay.  This relates to the FCC’s phase-in of a population-based methodology for calculating television station fee amounts.  It cannot be changed and should not be a cause for concern.  Regulatees whose total fee amount is $1,000 or less are once again exempt and do not need to pay.

In most years, the outcome of the annual Regulatory Fee battle ends with the FCC’s various regulatees rolling their collective eyes and murmuring “just tell me how much I have to fork over.”  This year’s Regulatory Fee proceeding had some surprises, however.  When the proposed fee amounts were first announced, they contained a dramatic increase in year-over-year fee amounts for most categories of radio stations.  Yet, the reason for this sudden increase was neither addressed by the FCC nor readily apparent from the FCC’s brain-numbing summary of its calculation process.

In response, all 50 State Broadcasters Associations and the NAB filed comments pressing the FCC to revisit its fee methodology and to explain or correct what appeared to be flawed data used to calculate broadcast Regulatory Fee amounts.  In particular, they pressed the FCC to explain why the estimated number of radio stations slated to cover radio’s share of the FCC’s budget had inexplicably plummeted between 2018 and 2019, resulting in each individual station having to shoulder a significantly higher fee burden.

In its regulatory fee Order, the Commission acknowledged that its estimate of the number of radio stations that would be paying Regulatory Fees in 2019 had been “conservative”, and failed to include 553 of the nation’s commercial radio stations.  Once these stations were added to the total number of radio stations previously anticipated to pay Regulatory Fees, the impact was to reduce individual station fees from those originally proposed by 9% to 13%, depending on the class of radio station.

This adjustment prevented what would have otherwise been a roughly $3 million dollar overpayment by radio stations nationwide, significantly exceeding the FCC’s cost of regulating radio stations in FY 2019.  The fact that the FCC listened to the concerns of broadcasters, investigated the discrepancy between 2019 station data and that of prior years, and made appropriate changes to fix the problem, is heartening, particularly given that stations’ only options are paying the fees demanded, seeking a waiver, or turning in their license.

Terrestrial satellite TV stations also received a requested correction to their fee calculations.  As noted above, the FCC is transitioning from a DMA-based fee calculation methodology to a population-based methodology for TV stations.  To phase in this new methodology, the Commission proposed to average each station’s historical and population-based Regulatory Fee amounts and use that average for FY 2019 before moving to a fully population-based fee in FY 2020.

In calculating the average of the “old” and “new” fees, however, the FCC neglected to use the reduced fee amount historically paid by TV satellite stations, which is much lower than that paid by non-satellite TV stations in the same DMA.  As a result, a TV satellite station might have seen its 2019 fees jump by tens of thousand of dollars over FY 2018, only to see them drop again in FY 2020.  The FCC acknowledged that its intent in adopting the phase-in was not to unduly burden TV satellite stations in FY 2019, and it therefore recalculated those fees using the lower historical fee amounts traditionally applied to such stations.

While these reductions are a rare win against ever-increasing regulatory fees, there remain big picture issues that Congress and the FCC need to address in the longer term.  Significant among these is the FCC’s reliance on collecting the fees that support its operations from the licensees it regulates (a burden not a benefit), while charging no fees to those that rely on the FCC’s rulemakings to launch new technologies on unlicensed spectrum or obtain rights against other private parties via the FCC’s rulemaking processes (a benefit not a burden).  Such a narrow approach to funding the FCC makes little sense, particularly where it unduly burdens broadcasters, who, unlike most other regulatees, have no ability to just pass those fees on to consumers as a line item on a bill.

We live in a time of disruption.  Disruption affects all areas of the economy, but surely the most affected has to be the communications sector.  If any government agency can claim to be the regulator of this disruption, it must surely be the FCC.  Yet despite the FCC’s position at the forefront of these changes, its Regulatory Fee process is mired in a system in which broadcasters are left holding the bag for more than 35% of the FCC’s operating budget (once again, burden not benefit).  Even as the FCC spends more of its time and resources on rulemakings, economic analysis, and technical studies surrounding new technologies and new entrants into the communications sector whose main goal is to nibble away at broadcasters’ spectrum, audience, and revenue, it still collects regulatory fees only from the licensees and regulatees of its four “core” bureaus – the International Bureau, Wireless Telecommunications Bureau, Wireline Competition Bureau, and Media Bureau.  It’s an old formula, and it no longer works.

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Pillsbury’s communications lawyers have published FCC Enforcement Monitor monthly since 1999 to inform our clients of notable FCC enforcement actions against FCC license holders and others.  This month’s issue includes:

  • Pennsylvania AM Station’s “Shenanigans” in Connection With Tower Violations Lead to $25,000 Fine
  • Georgia and North Carolina Radio Station Licenses at Risk Due to Unpaid Fees
  • FCC Cites New Jersey Vehicle Equipment Vendor for Programming Transmitters with Unauthorized Frequencies

Pennsylvania Station’s Tower “Shenanigans” Lead to $25,000 Fine

In a recent Forfeiture Order, the FCC fined a Pennsylvania AM radio licensee for various tower-related violations after the licensee failed to sufficiently respond to a 2016 Notice of Apparent Liability for Forfeiture (NAL).

Broadcasters must comply with various FCC and FAA rules relating to registration, lighting and painting requirements.  In particular, they must be lit and painted in compliance with FAA requirements, and any extinguished or improperly functioning lights must be reported to the FAA if the problem is not corrected within 30 minutes.  The FCC’s Rules require lighting repairs to be made “as soon as practicable.”

In 2015, FCC Enforcement Bureau agents responded to an anonymous complaint regarding a pair of radio towers.  Over multiple site visits, the agents determined that multiple mandatory tower lights and beacons were unlit and that the towers’ paint was chipping and faded to such a degree that the towers did not have good visibility.  In connection with the lighting problems, the licensee had also failed to timely file the required “Notice to Airmen” with the FAA, which informs aircraft pilots of potential hazards along their flight route.  The FCC cited these issues in a February 2016 Notice of Violation sent to the station.  The licensee responded by assuring the FCC that it would immediately undertake remedial actions.  However, a site visit from the FCC several months later revealed continuing violations, and the FCC subsequently issued the $25,000 NAL along with directions on how to respond.

At that point, the licensee’s woes expanded from substantive to procedural.  According to a Forfeiture Order, the licensee failed to file a “proper response” to the NAL.  Instead, in a bizarre series of events that the FCC chalked up to “shenanigans,” it noted that the licensee submitted a Petition for Reconsideration of the NAL, as well as a response to the NAL to the Office of Managing Director (OMD), instead of to the Enforcement Bureau.  OMD is a separate department within the FCC that deals with agency administrative matters, such as budgets, human resources, scheduling, and document distribution.  OMD subsequently returned the Petition and the NAL response to the licensee with a letter noting the licensee’s procedural misstep.

The licensee’s “shenanigans” were still far from over, however.  More than a month after OMD returned the licensee’s submissions, the licensee sent a letter to the Enforcement Bureau seeking to arrange an installment plan for the $25,000 proposed fine.  This, too, was procedurally flawed, as the NAL specifically explained that any requests for payment plans must be directed to the FCC’s Chief Financial Officer, not to the Enforcement Bureau.  Though the Enforcement Bureau itself forwarded the request to the CFO’s office, no plan was ever put in place.

According to the Forfeiture Order, despite the licensee’s various filings, it failed to successfully submit a response to the NAL to the Enforcement Bureau.  The Forfeiture Order also noted that even had the licensee’s NAL response been sent to the Enforcement Bureau (instead of OMD), it would have been defective for being late-filed.  The Enforcement Bureau therefore affirmed the proposed fine and ordered the licensee to pay the $25,000 fine within 30 days.

Pay to Play: FCC Initiates Proceedings Against North Carolina and Georgia Radio Stations Over Delinquent Fees

In a pair of Orders to Pay or to Show Cause released on the same day, the FCC began proceedings to potentially revoke the AM radio license of a Georgia station and the FM radio license of a North Carolina station. Continue reading →

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Pillsbury’s communications lawyers have published FCC Enforcement Monitor monthly since 1999 to inform our clients of notable FCC enforcement actions against FCC license holders and others. This month’s issue includes:

  • Investigation Into Undisclosed Radio Station Owner With a History of Felonies Leads to Hearing Designation Order
  • FCC Settles With Alaskan Broadcaster After Disastrous Station Inspection
  • FCC Reinstates Licenses for Tennessee and Alabama Radio Stations, Then Immediately Threatens to Revoke Them

Continue reading →

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Pillsbury’s communications lawyers have published FCC Enforcement Monitor monthly since 1999 to inform our clients of notable FCC enforcement actions against FCC license holders and others. This month’s issue includes:

  • FCC Revokes License for Unpaid Regulatory Fees; Warns Other Stations of Similar Fate
  • Texas Station Warned Over Multiple Tower and Transmission Violations
  • FCC Nabs Massachusetts Pirate While Commission Continues to Push for Anti-Piracy Legislation

Continue reading →

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One of the intriguing aspects of posting on CommLawCenter is the level of interest a particular post generates.  Posts announcing something of vital importance to broadcasters will sometimes make hardly a ripple, while more mundane posts attract surprising interest.

Indeed, one of CommLawCenter’s most-read posts in its early years was a discussion of the first national EAS test.  It wasn’t that non-broadcasters had suddenly become infatuated with EAS; it was because the first national EAS test happened to coincide with a near-miss between Earth and what was described as a “huge asteroid”.  There apparently was a sizable contingent of conspiracy theorists who thought that a national EAS test being held at the same time as the asteroid’s arrival indicated a government cover-up of the asteroid’s imminent collision with Earth.  I never understood the logic of that claim, but a four-month-old post on CommLawCenter announcing the national EAS test date suddenly became red hot in web readership until the asteroid peacefully passed by Earth.

So it was when we recently reported that shortly after the FCC shut down, some stations were getting calls claiming to be on behalf of the FCC and asking for payment of “FCC fees”.  When stations pressed for more information, the callers became belligerent or hung up.  In response, we alerted stations to be wary of such calls and to be especially leery of any caller that requested payment by gift card, which is the most common form of payment demanded by scammers (because they can’t be traced).

That brief alert received a lot of trade press coverage afterwards, and I certainly hope it saved a few stations some headaches.  We subsequently sought more information to see if there was anything that could be learned about the calls (were they all actually scams, were there multiple approaches, or just one unified effort?).  Unfortunately, there wasn’t much more information available, as it seemed most stations had just hung up and moved on with their lives.  However, we did get an interesting tidbit from one station—the callback number the caller had left on voicemail.  While that may seem odd, it’s common for phone scammers to leave a toll-free number behind so that those called can run out, obtain the necessary gift cards to make payment, and have a number they can call back to relay the gift card payment information to the scammer.

This particular number didn’t generate any useful information from a web search, but the way this particular call had been described seemed more formal and organized than you would expect the typical scam call to be (although the caller apparently still became belligerent when pressed).  As noted in the original post, the FCC (particularly when shut down) doesn’t make collection calls itself, but it does typically send a written “Past Due Notice” to licensees when a debt has stayed unpaid for 30 days.

I checked my files for a Past Due Notice a client received a few years ago, and sure enough, at the very bottom of the Notice was the phone number the station had provided.  Now we were getting somewhere.  As it turns out, despite being on a piece of FCC correspondence, it was not an FCC telephone number, but one associated with the Department of Treasury.  While the FCC does refer past due amounts to Treasury for collection (a questionable practice given that when you want to sell your station or renew its license, the FCC already has all the leverage it needs to get paid), the Treasury Department shut down long before the FCC.  Since the FCC doesn’t make collection calls, and both the FCC and Treasury were closed when this particular call was made, who was doing the calling?

Making the circumstances even more curious is the fact that the FCC actually pays Treasury to handle the collection of overdue FCC accounts.  If the FCC and Treasury are both shut down because they have no appropriated funds to operate, then the obvious question is: Who is paying a Treasury employee to do FCC collections if neither agency has funding to operate in the first place?

So I called the number to ask.  A very pleasant person (not belligerent at all, at least to me) answered the phone and indicated that she wasn’t sure exactly how the contract between the FCC and Treasury worked, but that money was apparently available for their continued operations, as they had not been informed they were at risk of being furloughed anytime soon.  She also said that any of the calls to stations in which the caller hung up when pressed would not have come from Treasury, as they are used to people thinking they are a scam caller and therefore work hard to persuade people that the call is a legitimate one.

I told her that with the FCC shut down, stations couldn’t access the FCC’s Fee Filer or Red Light systems to determine the validity of any claimed debt, so there were some serious concerns about which callers were scammers and which might be legitimate outreach from Treasury.  She responded that they were was unaware the FCC had taken the Fee Filer and Red Light systems down, and appreciated knowing that.  She added that she certainly understood why a broadcaster might be skeptical of a call given the shutdown and the inability to verify the existence of a debt until the FCC reopens.  I suggested Treasury might want to focus its collection efforts on other types of debts until the FCC reopens, but in any event, that Treasury should be aware that their calls might be viewed with more than the typical amount of skepticism until the government reopens.

As we finished the conversation, she confirmed that Treasury only takes traditional forms of payment, so again, if a caller asks to be paid in gift cards, the call is a scam.

But what if the call successfully passes that first test?  How do you tell if the call is legitimate, and equally important, whether you actually owe the amount claimed?  Under normal circumstances, the first thing you should do is log into the FCC’s Fee Filer and Red Light systems to determine whether any debt is outstanding and the amount of it (if there are amounts due, you’ll be able to pull up a “Remittance Advice – Bills for Collection (Form 159B) for the amounts owed).  Since those systems are currently unavailable during the shutdown, if you aren’t aware of any outstanding payment due, you may want to wait until the FCC reopens and the debt can be confirmed before sending any payment.

Alternatively, if you get a call from someone claiming to be with the Department of Treasury, ask them to send you their copy of your Form(s) 159B, which is also used by Treasury as the basis for their collection process.  Once you are satisfied that you owe the debt (and interest), they will walk you through the payment options (again, no gift cards).  If you believe the debt claim to be an error, you can challenge it, but be aware that if you earlier received a Past Due Notice from the FCC and did not challenge it within 30 days of the date on the Notice, the government may take the position that you waived your right to challenge it.

So if you get a suspicious call claiming you owe FCC fees, whether you think it is a scam or not, it’s wise to check the FCC’s Fee Filer to make sure you are all paid up.  If not, the call might be legitimate, particularly if the amount the caller is saying you owe is similar to the amount the Fee Filer is indicating.  Note that the amounts may not be identical, as the Fee Filer indicates the initial amount owed plus any payment penalty (for example, missing a regulatory fee payment results in an immediate 25% penalty), but may not include all accrued interest, which Treasury will also insist on collecting.

But what happens if you still don’t pay?  Well, you will continue to have “Red Light” status at the FCC, which means the FCC will place a hold on processing your applications.  You won’t be able to sell your station, get its license renewed, etc., until the Red Light status is removed.  Also, once the FCC refers the debt to the Department of Treasury, if Treasury fails to collect it within a certain period of time, it will actually hand the bill to private debt collection agencies for collection.  Those entities are renowned for their skill at harassing debtors (sometimes legally, sometimes not) into paying.  If you have the misfortune to reach that state of affairs, you’ll dream of the days when you were only getting calls from scammers.

 

 

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Proving once again that nature abhors a vacuum, we’ve just learned of another bit of fallout for broadcasters from the federal shutdown—scammers are apparently calling broadcast stations pretending to be calling on behalf of the FCC and seeking to collect “FCC fees” over the telephone.  The first of these calls that we heard about occurred within six hours of the FCC shutting down.

With the FCC largely closed at this point, these callers are likely assuming that it will be very difficult for a broadcaster to ascertain the veracity of a fee claim or to confirm whether a caller is actually connected to the FCC.  As detailed in our earlier post, however, the FCC, along with the rest of the federal government, is operating only at a bare-bones “protecting life and property” level at this point.  While it could certainly use the money given the current absence of congressional funding, a closed FCC is not seeking to collect it from broadcasters, and certainly not over the telephone.

So if you get a call claiming to be on behalf of the FCC and demanding money, be skeptical.  Be even more skeptical if the caller wants you to pay with gift cards—the preferred payment method of phone scammers.  The FCC is really more of a check and credit card operation, and has very complex systems for processing those forms of payment.  It will not allow you to pay your regulatory fees with gift cards, and certainly doesn’t do it over the telephone.

If you do get such a call, one place you can report it to is the Federal Trade Commission, but you may have to wait until the federal shutdown is over, as processing complaints regarding phone scammers is one of the many FTC activities that have ceased due to the government shutdown.

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Pillsbury’s communications lawyers have published FCC Enforcement Monitor monthly since 1999 to inform our clients of notable FCC enforcement actions against FCC license holders and others.  This month’s issue includes:

Headlines:

  • Unpaid Regulatory Fees Bring License Revocation Proceeding for Massachusetts FM Station
  • Unregistered Tower and Unauthorized Silence Spell Trouble for North Carolina AM Station
  • FCC Issues Warning to Denver Trucking Company for Unauthorized Transmissions on Public Safety Frequency

The Check is (Not) in the Mail: Massachusetts Station Risks Revocation over Missing Regulatory Fees

The FCC’s Media Bureau issued an Order to Pay or to Show Cause (“Order”) to the licensee of a Massachusetts FM station for failing to pay five years’ worth of regulatory fees and the corresponding penalty fees.  In response to the Order, the licensee must either pay the overdue fees or demonstrate why it does not owe regulatory fees.  The Order also launches a proceeding to revoke the station’s broadcast license.

Section 9 of the Communications Act (“Act”) requires the FCC to “assess and collect regulatory fees” for certain regulated activities, including broadcast radio.  Should a party fail to timely pay such fees, the FCC will assess a 25% late fee, as well as interest, penalties and administrative costs.  The FCC may also revoke licenses for failure to pay.

The licensee failed to pay its regulatory fees between fiscal years 2014 and 2018, and has accumulated a debt of $9,641.73 in unpaid fees and related charges.  The FCC repeatedly sent the licensee Demand Letters calling for payment but received no response.  The FCC eventually transferred the licensee’s debt for fiscal years 2014-2017 to the Treasury Department for collection.  At the FCC’s request, the Treasury Department recently transferred this debt back to the FCC in order to consolidate the collection process.

The licensee has 60 days to either: (1) provide the FCC with documented evidence that all its regulatory fee debt has been paid, or (2) show cause for why such payment is either “inapplicable or should otherwise be waived or deferred.”

Failure to provide a satisfactory response to the Order may result in the revocation of the licensee’s sole FM station license.

Silent Night: FCC Investigates North Carolina Licensee for Unregistered Tower and Other Violations

The FCC’s Enforcement Bureau issued a Notice of Violation (“NOV”) to the licensee of a North Carolina AM radio station for failing to register and light its tower, and for failure to operate its station in accordance with the FCC’s Rules.

Part 17 of the FCC’s Rules requires a tower owner to comply with various registration, lighting and painting requirements.  With limited exceptions, a tower that exceeds 200 feet in height above ground level must be registered with the FCC.  Further, towers must be painted and lighted in compliance with FAA requirements, and any extinguished or improperly functioning lights must be reported to the FAA if the problem is not corrected within 30 minutes.

Part 73 of the FCC’s Rules sets minimum operating hours for commercial broadcast stations.  A commercial AM station must operate for at least two-thirds of the total hours it is authorized to operate between the hours of 6 a.m. and 6 p.m., and two-thirds of the total hours it is authorized to operate between 6 p.m. and midnight every day except Sunday.  A station that expects to be silent for over 30 days must seek and obtain Special Temporary Authority (“STA”) from the FCC to be silent for such an extended period. Continue reading →

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Today the FCC publicly released a Report and Order eliminating TV stations’ annual obligation to report whether they have provided feeable ancillary or supplementary services on their spectrum during the past year unless they have actually provided such services.  The order was originally slated for discussion and a vote at next week’s FCC Open Meeting, but the Commission wound up adopting this widely supported change early, unanimously voting for it on circulation.

Previously, all digital television stations had to report by December 1 of each year whether they had provided feeable ancillary or supplementary services in the past year, what those services were, and then submit payment to the government of 5% of the gross revenue derived from such services.  Ancillary and supplementary services are any services provided on a TV station’s digital spectrum that is not needed to provide the single free over-the-air program stream required by the FCC.  The reason the word “feeable” is important is that broadcast video streams (i.e., multicast streams) do not trigger payment of the 5% fee.  Examples previously provided by the FCC of feeable ancillary and supplementary services include computer software distribution and data transmissions.

Observers had expected this rule change for a while.  In the spring of 2017, FCC Chairman Ajit Pai spearheaded the “Modernization of Media Regulation Initiative,” which aimed to institute a massive review of potentially outdated or irrelevant regulations affecting broadcasters, cable system operators, and satellite providers.  At Commissioner Michael O’Rielly’s urging, the Commission originally proposed today’s changes in a Notice of Proposed Rulemaking (NPRM) in October 2017.  The following month, the Media Bureau spontaneously waived the December 1, 2017 filing deadline for TV stations that had not provided feeable services over the prior twelve-month reporting period, signaling that the proposed rule change was likely coming.

Indeed, the FCC received broad support from commenters for the change.  In last year’s NPRM, the FCC noted that of 1,384 full-power commercial TV stations, fewer than 15 reported revenues from ancillary or supplementary services, netting the Commission around $13,000 in fees.

As a result, today’s Order amends Section 73.624(g) of the FCC’s Rules to require that only TV stations actually providing feeable ancillary or supplementary services need file the report in the future.  The FCC could find no justification for the immense expense incurred in having broadcasters submit, and the FCC collect and process, forms merely indicating the station hadn’t provided such services.  It wasn’t so much the FCC concluding that the expense outweighed the public interest benefit; it was the FCC being unable to point to a public interest benefit.

Which just makes you wonder just how this rule stayed in place for nearly 20 years, and no prior FCC bothered to ask that fundamental question.