DTV Permittees – This Means You!!!
The FCC has its hand in more broadcasters' pockets again. Effective November 10, 2009, responsibility for annual fees of 5% of revenues from ancillary or supplemental services (e.g., data transmission) extends to DTV permittees as well as DTV licensees. The fees are due on December 1 for the period through the preceding September 30 of each year, accompanied by FCC Form 317 (which must be filed electronically through CDBS). While DTV licensees have had to deal with Form 317 for some time, this year will be the first for DTV permittees – but since the impending DTV transition has already triggered an avalanche of new paperwork for DTV permittees (including quarterly public education reports and construction status reports, not to mention mod applications and license applications), what’s one more report, anyway?
According to the Commission, the services that are subject to reporting and fee requirements include “any ancillary or supplementary service for which a subscription fee is required or for which the licensee receives any compensation for transmission of material other than commercial advertisements used to support broadcasting.” That narrows it right down. In fairness to the Commission, though, this whole ancillary/supplementary fee business came from Congress, which dumped it in the Commission’s lap back in 1996.
Form 317, now available online at CDBS, requires each DTV licensee and permitted to describe: (1) any and all ancillary/supplementary services provided; (2) which services were feeable; (3) whether any ancillary or supplemental services were not subject to a fee; (4) gross revenues received from all feeable ancillary and supplemental services provided during the applicable period; and (5) the amount of bitstream used to provide the services. From this wealth of information you will be able to determine whether you owe the Feds their 5%. If it turns out you do owe a payment, you’ll have to pony up when you file the report and you’ll have to include Form 159. But even if you owe no payment, you’ve still got to submit Form 317 to verify that you do not.
If you neglect or forget to ante up, you may get caught up in an FCC audit of your records which support the calculation of your payment. To help the FCC nail you, the FCC's rule here requires that you retain records related to the services for three (3) years from the date of payment. (Where’s that pesky Fifth Amendment when you really need it?)
If you would like any help on this latest reporting and payment obligation, let us know. We won't help you pay it, but we can help you with the form and any questions you may have about it.