Last year, the Nevada PUC embarked on a "zero tolerance" policy for telecom carriers and other regulated utilities who filed late or incomplete annual reports, annual assessments, TDD surcharges, and CMRS (wireless) licensing fees. Based on a Staff Petition filed last August, the Commission issued an order to "show cause" why regulated companies who filed any of those reports/fees even a single day late or with just a small error or omission should not be fined or have their certificates revoked. Many companies filed comments in response to the show cause petition to plead their cases and demonstrate that they had come into compliance well prior to issuance of the petition. The comments had little to no effect and the Commission issued fines for all but a handful of the more than 100 companies on the show cause list.
On August 21 of this year, the Commission issued an order that continued this zero tolerance policy and two days later the Staff issued its 2013 Petition for Order to Show Cause. This year, 170 companies made the hit list, with 119 cited for either failing to file or for filing a late or incomplete annual report ; 31 for not filing or filing a late or incomplete TDD surcharge report/fees, CMRS Licensing fee or annual assessment; and 20 for two or more of these infractions. Of the 119 companies on the list for annual report infractions, 79 filed before the May 15 due date, but the report was rejected by staff due to some omission -- most typically a cash flow statement which was a newly enforced reporting requirement in 2013. Of those companies cited for filing late annual reports, five missed the deadline by just one day. 89 of the companies cited for a violation came into compliance before the Staff issued its Show Cause Petition.
Under the new Order to Show Cause process adopted this year, the Commission can impose minimum fines of $500 for late filings if there are no prior violations in the past three years, $1,000 for late filings if there have been prior violations, and $1,500 for failure to file with prior violations. This year's show cause order will likely impose fines totaling well over $125,000. Based on last year's experience, unless a company can affirmatively prove that it did indeed comply with the requirements on time (e.g., date stamp or overnight receipt confirmation), filing comments and/or appearing at the show cause hearing to explain the circumstances surrounding a late or incomplete filing will garner no sympathy from the Commission. Fines will still be imposed and, if the fine is not paid within 30 days of the final order, certificates will be revoked. In the home of Sin City, regulated companies need to be perfect angels!
TMI's Telecommunications Funds Matrix sample is available below.
Check our our Fall 2013 Telecom Regulatory Seminar October 24 & 25.