Annual FCC Regulatory Fees Due September 24, 2019; Fee Payment System Now Open
Kelley Drye Client Advisory
Please be reminded of the upcoming filing listed below:
Annual FCC Regulatory Fees
Most Federal Communications Commission (FCC or Commission) licensees and other regulated entities must pay regulatory fees annually to offset costs associated with the FCC’s enforcement, public service, international, policy, and rulemaking activities. Fee amounts change each year and vary by type of activity. On August 28, 2019, the FCC released a Public Notice announcing a payment deadline for annual FY 2019 regulatory fees of no later than 11:59 PM Eastern Daylight Time on September 24, 2019. Although the regulatory fees will not officially become effective until published in the Federal Register, entities that are required to pay fees have discretion to submit payments at any time before the deadline.
The Commission will not issue bills for the regulatory fees and it is the licensee’s responsibility to determine the fees owed (regardless of the amount posted on the Fee Filer system).
As noted in the Commission’s Assessment and Collection of Regulatory Fees for Fiscal Year 2019 Report and Order released on August 27, 2019, the FCC has assessed and plans to collect a total of approximately $339 million in regulatory fees for FY 2019. The Commission calculates regulatory fees by first determining the number of full time employees (FTEs) who perform the regulatory activities specified in section 9(a) of the Communications Act. These employees, or FTEs, are categorized as either “direct” or “indirect.” “Direct” FTEs perform regulatory activities in one of the “core” bureaus (i.e., the Wireless Telecommunications Bureau, Media Bureau, Wireline Competition Bureau, and part of the International Bureau).
Additional information about a few of the fee categories is included below. Fact sheets detailing the types of fees, fee codes, payment methods and options for all regulatory fees are usually provided on the FCC’s website and we expect they will be available soon.
- Telecommunications Service Providers. The Interstate Telecommunications Service Provider (ITSP) Fee must be paid by most companies, including VoIP providers and audio bridging providers. The ITSP regulatory fee is based on end user telecommunications revenues reported on the 2019 FCC Form 499-A and this fee has increased to $.00317 per assessable revenue dollar for FY 2019 (compared to $.00291 for FY 2018). Responsible organizations (“RespOrgs”) with toll free numbers must pay regulatory fees based on their toll free number count. For FY 2019, the toll free number fee has increased to $0.12, (compared to $0.10 for FY 2018).
- Licensed CMRS Providers. Licensed commercial mobile radio service (CMRS) providers must pay annual regulatory fees for each license held as of October 1, 2018 even if the license expired after that date. If the license was transferred or assigned after October 1, 2018, the fee is owed by the party holding the license as of the regulatory fee due date. CMRS fees are based on the licensee’s number of subscribers or telephone number counts as of December 31, 2018. CMRS cellular radio and mobile service providers will pay $0.19 per subscriber or telephone number, down from $0.20 for FY 2018, while CMRS messaging service providers experienced no rate change and will pay $0.08 per subscriber or telephone number.
- Submarine Cable Systems and International Bearer Circuits. Regulatory fees for submarine cable systems are paid on a per cable landing license basis for all submarine cable systems operating as of December 31, 2018, and the fee amounts vary based on the type of system. International Bearer Circuits are subject to a fee of $121 per active Gbps circuit.
De Minimis Exemptions and Requests for Fee Waivers
Under the Commission’s de minimis exemption, those entities whose annual regulatory fees, across all fee categories, total $1,000 or less, are exempt from paying FY 2019 fees. The de minimis threshold does not apply to multi-year filings. Entities are responsible for evaluating their fee liability each year to determine if the entity still qualifies for the de minimis exemption and must be prepared to provide supporting documentation to the Commission upon request.
Payment Methods and Late Payment Penalties
As a reminder, fees not paid by the due date are subject to a mandatory 25% late payment penalty and delinquent payors are subject to Red Light status. The Commission also imposes interest on delinquent fees and does not waive late payment penalties. Late payors now have some limited reprieve as, pursuant to the 2018 RAY BAUM’s Act, the Commission will no longer assess administrative costs on delinquent regulatory fee debts.
All licensees and regulatees must utilize the FCC’s Fee Filer system to coordinate paying any fees. The Fee Filer System is now available for viewing and payment of FY2019 regulatory fees and it can be found at https://apps.fcc.gov/FeeFiler/login.cfm. Payors must pay online by credit card, Automated Clearing House (ACH) payment, wire transfer, or Visa or MasterCard debit card – the Commission does not accept payment via check, cashier check or money order. Credit card payments to federal agencies are limited to $24,999.99 and transactions, including single payments or bundled payments of multiple bills, greater than $24,999.99 will be rejected. Payment must be received by the Commission by the 11:59 PM EDT September 24, 2019 deadline.
Please be advised that attorneys in Kelley Drye & Warren’s Communications Practice Group are experienced in addressing Federal Communications Commission reporting issues and are able to assist clients in paying regulatory fees. For information on the fee amount applicable to your company, please feel free to contact us or visit our blog at www.commlawmonitor.com.
For further information on any of these filings, please contact your usual Kelley Drye attorney.