Earlier this year, the CRTC was asked to look at the way it recovers its operating costs. Under the regulations that have been in place for a the past decade, the CRTC’s costs of telecommunications regulation are borne solely by carriers that file tariffs.
Those companies, the ILECs, are finding that to be increasingly burdomesome. As more types of services are forborne, a shrinking number of carriers are bearing the costs of CRTC activities that are not necessarily driven by tariff-related activity.
In 1998, the CRTC proposed amending the 1995 regulations on its own. At that time, the Commission stated:
The Commission notes that it is not solely the Canadian carriers that file tariffs that cause the Commission’s costs. Increasingly, Commission resources are spent, not only on processing tariff applications, but also on such activities as establishing and monitoring a regulatory framework designed to ensure that there is sustainable competition.
In the Commission’s view, the proposed new regulations provide for a more appropriate and equitable means of recovering the Commission’s telecommunications costs.
A year and a half later, the CRTC mysteriously abandoned its plan to revise the scope of fee-payers and maintained the status quo.
That was 8 years ago.
In yesterday’s Decision, the CRTC agreed with Bell and Aliant that its original 1998 view, calling for a new way to allocate costs, was correct. The Commission has indicated that it will draft changes to the fees regulations and seek approval from Treasury Board.
The CRTC plans to use a process similar to that used for subsidizing high cost serving areas. All companies (carriers and resellers) with Canadian telecommunications services revenues exceeding $10M are expected to become contributors to recover the cost of the CRTC’s telecommunications operations.
As new contributors, primarily cablecos and resellers, gripe about coming under the new tax scheme, they can take comfort in having escaped hundreds of millions of dollars in CRTC costs that have been paid solely by tariff-filing telcos for the past 7 years.