GAO Criticizes FCC's Regulatory Fee Process As Outdated

Critical

The Government Accountability Office has taken aim at the FCC's regulatory fee process, issuing a report saying that the process needs updating.

The GAO noted that the Commission "based its fiscal year 2011 regulatory fee assessments on its fiscal year 1998 division of FTEs (full-time equivalents working in certain bureaus) among fee categories and has not updated the FTE basis. "As a result," the GAO writes, "after 13 years in a rapidly changing industry, FCC has not validated the extent to which its fees correlate to its workload."

The GAO warned that the failure to update the FTE data is "inconsistent with federal guidance on user fees" and that "companies in some fee categories may be subsidizing companies in others."  It also suggested that FCC fee categories may be out of date because of the "increasingly cross-cutting nature of (the) FCC’s work."  And the GAO found that over the past decade, the Commission took in 2% more in fees yearly on average than it was required to collect, and under existing restrictions, the agency thereby ended up with $66 million in excess fees it cannot use without congressional action.

Suggestions made by the GAO pointed towards alternative approaches to fees by the Nuclear Regulatory Commission, Federal Energy Regulatory Commission, and CRTC, which assess fees based on an annually or biennially updated analysis of costs by industry sector.  The GAO also pointed out that other regulatory agencies refund excess fees or apply them to the next year's budget.

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