FY 2019 Regulatory Fees - Payment Deadline: September 24th, 2019

By Gregg P. Skall
Womble Bond Dickinson (US) LLP

The FCC finally has finally released its order on regulatory fees for fiscal year 2019. On August 27th, it issued a public notice announcing the opening of its automated filing and payment system. Notably, the Commission warned broadcasters that the regulatory fee payment deadline for receipt of payments is 11:59 p.m. EDT on September 24th, 2019. As in the past, all payments must be made electronically through the FCC's electronic payments system. Checks, money orders and cashier's checks will not be accepted as a means for payment of regulatory fees.

25% Late Fee Penalty

It is critical that all broadcasters make their payments on time. Congress recently added section 9(a) to the Communications Act, which requires it to impose a late payment penalty of 25% of the unpaid amount to be assessed on the first day following the deadline for filing regulatory fees. A failure to pay regulatory fees or any late penalty will subject a regulatee to sanctions, including withholding action on any applications, petitions or other requests for action. In addition, late payments incur additional processing charges incurred by the government in collecting delinquent debts.

What Do I Owe?

The full commission order may be viewed at http://www.fcc.gov\regfees. Media licensees and permit holders owe regulatory fees for each license or permit held as of October 1st, 2018, even if the license or permit expired after October 1st, 2018. Where a license or permit was transferred or assigned after October 1st, 2018, the fee must be paid by the party that is the licensee or holder of the permit on the date that the fee payment is due, i.e. September 24th, 2019.

FCCFees.com

The FCC established a special 2019 regulatory fee information site at http://fccfees.com, where fee information and exempt status for any broadcast property can be searched by facility ID or call sign. The site also provides additional information on digital LP, class A and TV translator and booster stations now transitioning to digital. During this interim transition period, licensees could be operating in either analog or digital or in simulcast mode. A regulatory fee will be assessed for each facility operating in either analog or digital mode and if operating in both analog and digital, the fee is assessed for the analog facility that has a digital companion channel. Once the payment amount is determined, all regulatory fees must be filed, submitted and paid through the fee filer system at www.fcc.gov\fees\feefiler.html.

Petitions For Reconsideration

Because of the significant increase in proposed 2019 broadcaster fees, several parties, including the NAB, filed petitions for reconsideration. In response, the Commission made some adjustments. Regarding TV translator stations, the FY2019 NPRM proposed to adopt a fee based on average of the historical DMA methodology and the population covered by a full-power broadcast station's contour with a factor of .72 of one cent ($.007224). The Commission acknowledged an error in averaging the historical fee paid by satellite stations and adopted the proposal to transition television from the historical DMA fee structure to the contour-based methodology, using an average of the historical and contour-based fees in this transition year.

For AM and FM radio, the Commission acknowledged that it had underestimated the number of fee-able licenses. This resulted in a dramatic increase in each station's fee. Accordingly, it updated its data, identifying licensed facilities as of October 1, 2018 from the Media Bureau's system and adjusted for stations that are exempt and de minimis. This increased the number of stations sharing the fees allocated to radio stations by 553 to 10,011, resulting is decreased fees from the previous proposal

De minimis Regulatory Fees

Section 9(e)(2) of the Ray Baum' s Act, requiring the FCC to collect fees for 2019, permits the Commission to exempt licensees from paying regulatory fees when the cost of collecting the fee would exceed the amount collected from that party. The Commission determined that amount to be $1,000 and adopted a de minimis fee exemption of $1,000.

The Payment Process

Regulatory fee payment through the FCC system can be complicated, despite the efforts by the Commission to simplify the process. Given the consequences of making a late fee payment, all broadcasters should become thoroughly familiar with the process as quickly as possible or rely upon a seasoned professional to assist you with your 2019 regulatory fee payment.

This column is provided for general information purposes only and should not be relied upon as legal advice pertaining to any specific factual situation. Legal decisions should be made only after proper consultation with a legal professional of your choosing.