WASHINGTON-The Federal Communications Commission “does not know if all required fees are being paid,” according to a study released last week by the General Accounting Office at the direction of the Senate Permanent Subcommittee on Investigations.
“It is troubling and sadly ironic that the [FCC]-an agency charged with regulating technologically sophisticated industries-did not implement an accounting system capable of determining if it is collecting the money it is owed,” said Sen. Susan Collins (R-Maine), chairman of the investigations subcommittee.
The FCC collects both regulatory and application, or filing, fees. Regulatory fees are a separate assessment from filing fees since regulatory fees go to offset congressional appropriations and filing fees are sent to the general treasury.
The amount of regulatory fees to be collected is set each year by Congress. Congress told the FCC to collect 6 percent more for fiscal year 1999 than it collected for FY 1998. Regulatory fees amount to approximately 80 percent of the FCC’s annual budget.
“In the area of regulatory fees, [the] FCC relies on members of the telecommunications industry to comply voluntarily with its fee payment schedule, since it lacks the necessary information and systems to verify that every entity that should pay a fee has done so,” the GAO said.
The FCC pledged to improve its fee collection processes. It has hired a project manager “to undertake the major corrective action of finding and implementing a new revenue accounting system,” said FCC Managing Director Andrew S. Fishel in a letter included in the GAO report.
The Personal Communications Industry Association was pleased with the GAO report and the FCC’s response.
“This is an example of government oversight working the way it should. Obviously, the Senate subcommittee identified certain issues with the regulatory fee system and recommended solutions. Clearly the FCC has taken the recommendations to heart,” said Angela Giancarlo, PCIA director of federal regulatory affairs.
The Cellular Telecommunications Industry Association has been in a public fight with the FCC over the regulatory-fee issue.
The FCC rejected CTIA’s arguments that mobile-phone carriers are paying a disproportionate share of the regulatory-fee burden. CTIA said the proposed fee was overcalculated by $8 million.
CTIA was also pleased with the investigation and hopes that future investigations will study the amount companies pay.
“Sen. Collins’ interests in the FCC’s collection of regulatory fees merits full attention. It was interesting to see how the GAO showed that several companies that should have paid fees did not. But, unfortunately the GAO report did not include companies that pay fees that may have been overcharged by the FCC due to the fact that the FCC does not maintain or rely on the most current or accurate data. We note the subcommittee will continue to examine the fee collection process of the FCC and will encourage Sen. Collins to include in her investigation the very real possibility that companies who are paying fees are paying too much,” said Brian Fontes, CTIA senior vice president for policy and administration.
The FCC cannot account for a majority of the fees that are not collected. Still, PCIA’s Giancarlo said carriers should still pay.
“It is in everyone’s best interest for all regulated businesses to pay their fair share, otherwise those that comply have to make up the rest.”
