PRSS Announcement on Station-Fee Structure Change

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Dear Station Colleagues,

Last week, the NPR Board approved a station-fee structure change recommended by the Distribution / Interconnection Committee. This is the first change in the fee structure in 30 years. Under the new structure, which is effective January 1, 2017, station D/I fees will be calculated by multiplying a station’s Total Station Revenue (TSR) by an applicable percentage rate set each year.

WHY YOUR PEERS DECIDED TO DO THIS:

The D/I Committee tackled this issue because of questions raised by stations across the system. The current flat-fee rate, while equally levied, was not perceived as equitable. Some stations pay as much as 4% of their TSR for PRSS services while others pay as little as 0.04% of TSR.

Changing the structure for assessing D/I fees will prepare PRSS to deal with any fluctuations in federal funding in future years and will reduce financial pressure on the smallest stations.  

WHAT STEPS WERE TAKEN:

Initially, the analysis looked at PRSS financials. Station fees comprise only 18% of the cost of operating the PRSS. The balance is from producer fees, sales of excess satellite capacity, investments, a charitable trust and federal funding. In addition, analysis showed that PRSS has made significant efforts to cut costs over the past few years: PRSS Operating Expenses are down 16.5% over the past three years -- from a total $14 million in FY 2013 to a forecast $11.7 million this year. Part of the savings is because PRSS staff has been reduced 21% since 2011.

At the direction of the D/I Committee, staff provided data and analysis on more than 20 possible fee models. Data was gathered from station visits, CPB, the PRSS Help Desk tickets, conferences such as the Public Radio Super Regional, PRIMA, and PREC, and meetings with the D/I Committee and the PRSS Future Systems Advisory Council. Finally, in January, members of the Committee and the Advisory Council also conducted a peer-to-peer survey to solicit views from 20% of the station general managers across the PRSS.

HOW THIS AFFECTS YOUR STATION:

The expectation is that in 2017, no station will pay more than $10,500, that is, the increase will be no more than $1,500 over this year (the current rate is $9,020). It is likely that about 140 of the smallest stations will pay less than they are paying now.

The timing was designed to allow stations with fiscal years beginning in July to have enough time to plan PRSS expenses in their budgets.

MORE INFORMATION ABOUT THE STATION FEE-STRUCTURE CHANGE:

I will host a webinar briefing about this change on Wednesday, March 16th from 1:00 PM ET to 2:00 PM ET [10:00 AM to 11:00 AM Pacific Time]. You can register at: https://attendee.gotowebinar.com/register/2323668664676690180

I encourage you to register for this, and I look forward to your questions.

 

Sincerely,
Michael Beach

 

Posted: March 4, 2016