The head of a public, education and
government (PEG) channel advocacy group urges Maryland lawmakers not to include
cable franchise fees that support PEG channel in a state bill that seeks to
review the state’s “telecommunications tax and fee systems.”
state bill, the proposed “Telecommunications
Taxes, Reform Commission and Moratorium” (House Bill 563) was introduced Feb.
3, 2012, and was referred to the House Ways and Means Committee.
On Feb. 22, that committee held a hearing on the
bill, at which Sylvia
Strobel, the chief staff officer of the Alliance for Community Media (ACM),
testified and expressed concerns about HB 563; “specifically its potential
impact on PEG operators in Maryland.”
The bill seeks to
establish a state organization, the “Telecommunications
Tax Reform Commission,” which would “assess the feasibility and fiscal
implications of a competitively neutral telecommunications tax and fee system
that eliminates the disparate treatment of similar telecommunications service
providers.” The commission would submit a report of its assessment to the
General Assembly during the 2013 session.
The bill says the reasons for the assessment of the
“tax and fee system” are because “competition and changes in technology have
expanded the types of telecommunications services to businesses and consumers
in Maryland” and “most state and local taxes and fees on telecommunications
services were adopted before these changes in technology and the emergence of
Therefore, the “current tax and fee structures may
no longer be suitable for the telecommunications marketplace” and “the burden
of collecting and remitting taxes and fees on telecommunications services is
borne by providers of the services” who, along with other entities that receive
revenues from telecommunications taxes such as the state and county
governments, “should participate in any discussions about restructuring” those
taxes and fees, the bill says.
In her testimony, Strobel said unlike public radio and
public television, PEG channels do not receive any federal or state funding, but
they “rely primarily on PEG access and franchise fees to pay their employees
and operate their newsrooms and facilities.”
In addition, since 2005 there has been “a drastic
reduction in community media centers in states that have moved away from local
municipal franchise negotiations to a statewide system of franchise and access
fees,” she said.
“While we understand why the General Assembly wishes to
review the taxation issues, PEG and cable franchise fees should not be included,”
Strobel said. Those fees “are best negotiated at local level, with agreements
based on local needs of communities (as opposed to the general population base),”
she said. “We [ACM] respectfully request that the state of Maryland take all
steps necessary to prevent further erosion of public participation in U.S.
cable communications systems now and in the future.”