OVER A CENTURY OF SERVICE

At

Aromatic Polyurea Coating

OBIC Armor 1000 is 100% solids lining provides excellent corrosion protection, chemical resistance and high abrasion resistance. A bonded coating system that provides an integrated build-up of substrate through a multi-layer installation. In subfreezing weather conditions, it remains impact resistant.

With its tough and durable, seamless monolithic waterproof membrane, it is extremely well suited for metal, wood, concrete, fiberglass and other various metal surfaces.

Benefits:

1:1 Mix Ratio • Quick Return to Service • No VOCs

Installed in 0°F to 150°F • Odorless

Has there been more recent activity at the Missouri Legislature since adoption of the VSP Act in 2007?

In 2021, the Legislature made changes that removed certain revenue categories (such as advertising) from the revenues that are subject to the video service fees and also enacted a multi-year phased reduction of the fees, currently set to commence this September. Over the ensuing four years, the fee cap will reduce to 2.5%. Absent a legislative change, cities will need to comply with the upcoming reductions.

In conjunction with the step-down of fees, the Legislature also created a task force to study issues and develop recommendations by the end of 2023 regarding “best methods for right-ofway management, taxation of video services, and the future revenue needs of municipalities and political subdivisions as such revenue relates to video service.” Unfortunately, the task force has not met.

Meanwhile, the streaming industry has repeatedly tried (so far unsuccessfully) to get Bills passed by the Legislature to eliminate their video fee obligations. This year is no exception. The MML, the St. Louis Metro Municipal League, and the class action legal team endorse a counterproposal that would postpone the fee reductions and extend the time for the task force to do its work, so that the deal struck by the Legislature in 2021 can be fulfilled.

Our city received a video fee payment from DirecTV that included an assertion that it was not paying on all its revenues and that if we deposited the check, we would waive claims about underpayment. Can they do that?

Last year, AT&T transferred the U-Verse cable business to its affiliate DirecTV. When it came time to make the next video fee payment, DirecTV sent partial payment to many cities throughout Missouri with a letter asserting that accepting that payment would result in a waiver of claims about the underpayment unless an audit was requested. In the opinion of the class action legal team, such a “paid in full” claim has no effect on obligations to make payments to government entities. (In other words, do not try this approach with the IRS!). The class action legal team told DirecTV’s lawyers and the court they believe such a communication was an improper and ineffective bypass of the court process. DirecTV tried a similar approach in Indiana and the court barred such communications, finding portions of them misleading and

“unnecessarily antagonistic.” If your city is still holding such a payment, consult with your city attorney.

PS – AT&T retained ownership of the transmission facilities in the right of way, and yet DirecTV has made voluntary (albeit partial) video fee payments for sending U-Verse programming over those facilities. Thus, DirecTV has conceded that ownership of facilities in the right of way is not a prerequisite to the obligation to pay video service fees and that transmission of video programming through facilities in the right of way requires payment of video service fees. While the defendants have raised a myriad of (inapplicable) defenses, this concession strikes at the core of their refusal to pay the fees.

How can our city help?

The class action legal team is completing the collection of video franchise ordinances for use in the lawsuits. The MML recently sent a request to those cities from which ordinances are still needed. The pertinent ordinance could be one adopted in conjunction with the enactment of the VSP Act or your most recent cable franchise ordinance(s). If your city still does not have a VSP ordinance, then we suggest you discuss adopting one with your city attorney to make your fee requirements as clear as possible given the passage of time since the Act was passed and subsequent amendments.

Please double-check to see if your city received this request from the MML and, if so, whether your response has been sent. Your prompt assistance is important and will help ensure that your city will receive its fair share if the cases are successfully resolved.

A similar effort is underway to complete the collection of telecommunications tax ordinances for use in efforts to enforce those taxes. Your cooperation on that front would also be most appreciated.

Please support MML’s legislative efforts regarding video fees described in this article (and MML’s other legislative efforts too!).

Carl Lumley is a principal attorney and president of Curtis, Heinz, Garrett & O’Keefe, P.C. Contact him at clumley@chgolaw.com or (314) 884-7503.