Community Media Public Benefit Bill: H.575 and S.181: Vermont House Committee on Ways and Means - Testimony of Gross Receipts Draft VAN Long Term Funding

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Testimony of Gross Receipts Draft VAN Long Term Funding at the House Committee on Ways and Means.

On Wednesday, the House Ways & Means Committee took testimony on the HWM Committee Bill that would institute a 5% Gross Receipts Tax on internet streaming and satellite services to generate revenue for the Community Media Benefit Fund, that would then be appropriated annually to AMOs.

Kirby Keeton, legislative counsel, provided an update on two changes that were made in the current version of the bill (Draft 1.1). The version removes a specified penalty for those subject to the late filing or failing to file, instead leaving the penalty to the default under existing statute. Another change was to add a $1.1 million appropriation for the Department of Taxes to cover the cost of implementing a brand new tax. Jim Horwood, an attorney and one of the authors of the New York law on which the Committee bill is based, testified about what’s in the NY bill and why, and how that state’s context differs from Vermont. Lauren-Glenn Davitian provided testimony on the history of AMOs and the cable franchise fee in Vermont; on the revenue shortfall in the cable franchise fee system; and why the pole attachment tax is preferable to the gross receipts tax currently being considered. Committee questions focused on coverage - how to ensure communities not currently covered by cable districts can access PEG content equitably - and on the scale and extent of the revenue shortfall. Nancy Werner provided brief testimony on why the pole attachment tax is clean, legal, vetted, and easy to administer. She also noted the gross receipts tax in the current committee bill might run afoul of federal telecommunications law. Damon Stewart, Attorney with Dish Network and DIRECTV, testified in opposition to the bill on the basis that satellite providers do not access physical public infrastructure in the same way as cable companies, and also have their own PEG-like commitments under federal law, so a gross receipts tax would be discriminatory.