Regulatory Fee Order Expected to Include Changes for Low-Band VHF Stations

The order and NPRM on regulatory fees is expected to include changes from the draft intended to accommodate the concerns of VHF TV stations, said broadcast industry and FCC officials in interviews this week. The NPRM is likely to include language proposing possible regulatory fee relief for entities affected by the COVID-19 pandemic, an FCC official noted. The order is to be approved before Wednesday's commissioners’ meeting, and unanimous approval is expected (see 2005080046).

The final order is likely to be responsive to a filing in docket 19-105 from Maranatha Broadcasting, which argued for a percentage discount on regulatory fees for low-band VHF stations. Maranatha said the discount would apply to about 50 stations: “The low-band VHF stations simply are among the least valuable TV stations yet perversely ... they are proposed to have among the highest regulatory fees in their markets.” Since the digital transition, VHF stations have become less valuable than UHF stations, as was shown by the FCC's own valuations for the broadcast incentive auction, the company said.

The original draft order didn’t discount regulatory fees for VHF stations but said the agency would consider fee waivers case by case, based on “terrain blockages.” The agency rejected broadcaster arguments for VHF relief. "The impact of signal disruptions, to the extent they exist, varies widely from service area to service area and does not lend itself to an across-the-board rule," said the original draft. Terrain shielding “is not the problem that causes digital VHF reception to be inferior to UHF stations,” said Maranatha. “Instead, it is the nature of the signal itself.”

PMCM supported Maranatha’s proposal, and suggested the discount for low-band VHF stations be 50 percent. That discount would reduce regulatory fee intake by $654,000, PMCM said. The discount “would be critical” to the VHF stations' financial health and sustainability but “would have virtually no effect on the Commission’s overall revenue requirement,” PMCM said. FCC and industry officials said the final order may not go as far as the PMCM proposal.

A proposal on regulatory fee relief connected with the pandemic was raised by NAB in a recent filing on broadcast application notices. The association requested language specifically suggesting fee relief for broadcasters. An FCC official said the final order uses more general terms.