Understanding Taxes, Fees and Other Charges on Your Bill

On December 20, 2019, Congress enacted the Truth-in Billing Law requiring all cable and broadband providers to fully disclose all “hidden fees” that would appear to raise prices and disguise the true cost of video and broadband services.  Providers are required to provide the consumer by phone, in person, online, or by other reasonable means – with the total monthly charge for the service selected by the consumer including:  related administrative fees, equipment fees, taxes, and other surcharges.  We are committed to delivering the best entertainment and services you rely on today – and the new experiences you’ll love down the road.   From time to time, we may adjust service prices and fees.   These increases help us to consistently improve our network, products, and services, as well as cover the rising costs to our business.

You may not realize that we pay programmers like Fox, ESPN, HBO and others to be able to bring you their programming.   In addition, we pay retransmission fees to local networks to carry those stations.  Programming fees are the fees we pay to the programmers and are one of our largest costs and increase regularly.  Changes to the fees we charge ensure your access to top networks and the latest entertainment experience.

We share this information noted below to be more transparent about what drives changes in your bill.  Below is a list of common fees, taxes, and other charges, along with their explanations.

Broadcast Surcharge

The Broadcast Surcharge fee is based on our costs of providing the local broadcast stations that we carry on our cable systems in each area.  These costs include the fees that the broadcast stations charge Vexus to carry them on our cable systems.

Equipment Rentals

If you rent your box, DVR, TiVo box, modem or voice equipment from Vexus, you may see a separate line item on your monthly bill.    Depending on your package, we may charge separately for the equipment.  The rental fee may change from time to time, and you will receive advance notification before an increase takes place.

Sports Surcharge

This fee offsets some of the costs Vexus must pay to sports programming networks.

Statement Printing Fee

This fee is assessed to Customers who elect to receive a paper bill for the related cost of paper, postage, and administration.

Federal Telecommunications Taxes, Fees, and Surcharges

Federal Excise Tax

The federal telephone excise tax is a statutory 3% federal tax on local telecommunication services.  It is collected from the customer by Vexus and remitted to the Internal Revenue Service on a bi-monthly payment schedule.   The tax is on local only phone charges.   Taxable local-only services are any phone plan with no bundled long distance services, or any stand along local features that are offered.    Vexus files a quarterly Excise Tax Return Form 720 with the Internal Revenue Service.

Federal USF (Universal Services Fund)

Federal USF is a federal fund established to help support and provide affordable phone services to everyone.  All companies providing telephone service between states must contribute to this fund that helps provide affordable access to telephone service to consumers with low incomes, consumers living in areas where the cost to provide service is extremely high, and also to schools, libraries, and rural health care providers.  Telephone companies are allowed to recover these costs from their customers.    Federal USF is accessed on interstate, international, and safe-harbored on hosted phone revenues.   The USF contribution rate is reviewed and adjusted quarterly by the USAC and posted to the FCC website.  Vexus files a quarterly 499Q and an annual 499A reconciling all revenues reported and associated with the Federal USF.   On a monthly basis,  Vexus remits the Federal USF contribution to the Universal Services Administration.

FCC Fees

All cable service providers collect and remit FCC fees to the FCC on an annual basis. FCC rules permit cable operators to recover the regulatory fees from cable subscribers in 12 monthly installments.  The current FCC fee is 9 cents.

Interstate TRS Fund – Regulatory Cost Recovery Fees

The interstate Telecommunications Relay Service Fund was established by the FCC to help speech and hearing impaired individuals use telecom services.  The fund reimburses relay service providers for completed interstate traditional TRS and speech to speech minutes of use and for all completed Internet protocol relay service and video relay service minutes of use.  The assessment is calculated based on the 499A data in Line 514b and multiplied by the Program Year Assessment Rate.   Vexus remits the Interstate TRS fund contribution on a monthly basis.  The Regulatory Cost Recovery Fee covers the cost of Interstate TRS Fund.

Local Number Portability (LNP) Charge

The LNP charge passed via the FCC on February 1, 1999.  This charge funds the configuration of local telephone companies’ networks so that a customer switching local telephone companies will not need to change his current telephone number.  It recovers the cost of creating new facilities, the cost of upgrading the network to accommodate number portability, and recurring costs incurred in providing local number portability.

Federal Subscriber Line Charge/Federal Access Recovery Charge

The Subscriber Line Charge is a fee that you pay to your local phone company that connects you to the telephone network.  Local telephone companies recover some of the costs of telephone lines connected to your home or business through this monthly charge on your bill.  The fee is regulated and capped by the FCC.  The fee is capped at $6.50 per line.

Presubscribed Interstate Carrier Charge (PICC)

This is a charge the long distance telephone carriers collect and use to pay the cost of the incumbent local exchange company assessing the long distance company when a consumer picks it as his or her long distance carrier.  The current fee is $1.04 per line.

State Subscriber Line /Access Recovery Charge

This fee is a monthly charge to customers or other telephone companies by a local telephone company for the use of its local network.  When you make a long distance call, your long distance carrier must pay the local exchange carrier for starting or originating the call.  In addition, your long distance carrier must pay the telephone company that provides local service to the person you are calling to complete the call.  These charges are called “access” to the long distance provider that must get to the local network.

Carrier Service Fee

The Carrier Service Fee is a fee that helps cover administrative expenses for national and local regulatory fees and programs as well as connection and account servicing charges to help absorb the costs of the regulatory fees imposed on us.  The fee is not a tax or a charged required by the government.

Copyright Surcharge Fee

The Federal Government requires Vexus to pay fees to the Copyright Tribunal to obtain a copyright license in the course of carrying broadcast stations on your Basic Cable Service.

Texas Telecommunications Taxes, Fees, and Surcharges

State and Local Sales Tax

Texas businesses are subject to State and Local Sales Tax.   The sales tax applies to the gross receipts of all retail sales, including the sale, lease, or rental of tangible personal property including Video and Telephone services.  The state sales tax rate is 6.25%.  Texas also allows local governments to collect a local sales tax that varies by location up to 2% for a maximum tax rate of 8.25%.  Taxes are collected from customers and remitted on a monthly basis to the Texas Comptroller.  The state handles local disbursements to each local authority.

Transit Improvement Tax

Texas has six metropolitan transit authorities (MTAs), two city transit departments (CTDs), one county transit authority (CTA) and one advanced transportation district (ATD) that impose a sales and use tax. These authorities, their appropriate tax rates, and the participating cities and areas in each transit area are shown below.  Rates can be viewed at the Texas Comptroller site https://comptroller.texas.gov/taxes/sales/mta.php

Special Purpose District Tax

There are 343 special purpose districts (SPDs) that impose sales and use tax. These SPDs and their appropriate tax rates can be viewed at https://comptroller.texas.gov/taxes/sales/spd.php. The SPD tax is collected in addition to state tax and any other local taxes (city, transit, and county).

Texas Public Utilities Gross Receipts Tax

All public utilities, including long-distance companies, pay one-sixth of 1% (.1667) of their gross receipt to the Office of the Public Utility Counsel.    Fees are assessed monthly and submitted annually.

911 Surcharge

Any telecommunications service provider, wireless telecommunication service provider, or interconnected voice over internet protocol (VOIP) service provider shall collect and remit a 911 surcharge per service user line in Texas.   In areas where an RPC Regional Planning Commission provides the 911 service, the rate is .50 per local access line.   For service providers in areas served by an Emergency Communication District ECD, the ECD sets the rate.  911 funds the emergency response centers known as PSAPs or Public Safety Answering Points.  In the event of an emergency, 911 services give the ability for telephone customers to dial an abbreviated 9-1-1 number to access help from a PSAP.   This system then automatically provides a caller’s name, address, and phone number to the 911 answering service.    

Texas Franchise Fees/Right of Way Fee

A franchise fee is assessed by a local town or government. City Council members meet and set the rates.  Franchise Fee rates vary between 5% and 6%.  The fee is accessed on cable services, specifically set out in each individual and/or state-wide agreement, for the use of public rights of way and the right to operate a cable system in that local community.  Franchise Fees are collected monthly and remitted to the local franchising authority on a quarterly basis.     A Right-of-Way fee may be accessed on telephone services where there is no cable service franchise fee assessed.

Public, Educational, Governmental Access (PEG) Fee

Public access, governmental access and educational access fees are for costs associated with the local access channels required by the local cable franchise agreement.   This fee is set by the local town or government.  PEG Fees are collected monthly and remitted to the local franchising authority on a quarterly basis.

Texas State USF

The Texas USF allows affordable service to high-cost rural customers, funds the Texas Specialized Telecommunications Assistance programs for the hearing-disabled, and funds telecommunications services discounts to low-income customers.  The Texas USF rate is 3.3% and submitted to the Texas Universal Service Fund on a monthly basis.

Administrative Fee

Customer are charged an administrative fee for the cost of paper, sorting, processing payments, and postage.

Regulatory Cost Recovery Fee

Regulatory Cost Recovery Fee is a charge assessed as a percentage of video, telephone, and internet services to recover the cost of local, state, and federal regulatory compliance charges.

Louisiana Telecommunications Taxes, Fees, and Surcharges

State and Local Sales Tax

Louisiana businesses are subject to State and Local Sales Tax.   The sales tax applies to the gross receipts of all retail sales, including the sale, lease, or rental of tangible personal property.  The state sales tax rate is 4.45%.  Louisiana also allows local governments (Parish) to collect a local sales tax that varies by location.  Taxes are collected from customers and remitted on a monthly basis to the Louisiana Department of Revenue.  The state handles local disbursements to each local authority.

Louisiana Telecommunications Tax for the Deaf

The Louisiana Department of Revenue imposes a five (5) cent excise tax on every local exchange telephone company operating in Louisiana.  The tax helps provide fully telephone accessibility to people who are deaf, hard of hearing, or speech disabled.  Specially trained Communication Assistants complete all calls and stay on-line to relay messages either electronically over a Teletypewriter (TTY) or verbally to hearing parties.  This service, known as Louisiana Relay, is available 24 hours a day, 365 days a year.   The tax is five (5) cents per month on each residence and business customer telephone access line.   Taxes are remitted quarterly to Louisiana Department of Revenue.

911 Surcharge

Any telecommunications service provider, wireless telecommunication service provider, or interconnected voice over internet protocol (VOIP) service provider shall collect and remit a 911 surcharge per service user line in Louisiana.  911 funds the emergency response centers known as PSAPs or Public Safety Answering Points.  In the event of an emergency, 911 services give the ability for telephone customers to dial an abbreviated 9-1-1 number to access help from a PSAP.   This system then automatically provides a caller’s name, address, and phone number to the 911 answering service.    911 fees are set by each Parish and remitted to each Parish accordingly.

Louisiana Franchise Fees

A franchise fee is assessed by a local town or government. City Council members meet and set the rates.  Franchise Fee rates in Louisiana are 5%.  The fee is accessed on cable services, specifically set out in each individual agreement, for the use of public rights of way and the right to operate a cable system in that local community.  Franchise Fees are collected monthly and remitted to the local franchising authority on a quarterly basis.

Public, Educational, Governmental Access (PEG) Fee

Public access, governmental access and educational access fees are for costs associated with the local access channels required by the local cable franchise agreement.   This fee is set by the local town or government.  PEG Fees are collected monthly and remitted to the local franchising authority on a quarterly basis.

Arizona Telecommunications Taxes, Fees, and Surcharges

State and Local Sales Tax

Arizona businesses are subject to State and Local Sales Tax.   The sales tax applies to the gross receipts of all retail sales, including the sale, lease, or rental of tangible personal property.  The state sales and use tax rate is 5.6% and is also referred to as the state transaction privilege tax.  Arizona also allows local governments to collect a local sales tax that varies by location.  Taxes are collected from customers and remitted on a monthly basis to the Arizona Department of Revenue.  The state handles local disbursements to each local authority.

Arizona State Universal Service Fund

The Arizona USF allows affordable service to high-cost rural customers.  The High Cost Fund help provide carriers with the fund they need to service high cost and rural areas throughout Arizona.  The Arizona USF rates are based on Category One and Two Providers as follows:

Category One providers:

• .020559 per access line
• .205585per interconnecting trunk line

Category Two providers:

• .350715418 percent per intrastate toll revenues

New Mexico Taxes, Fees, and Surcharges

State and Local Sales Tax

New Mexico businesses are subject to State and Local Sales Tax.   The sales tax applies to the gross receipts of all retail sales, including the sale, lease, or rental of tangible personal property.  The state sales and use tax rate varies throughout the state from 5.125% to 8.6875% depending on the location.   Taxes are collected from customers and remitted on a monthly basis to the New Mexico Taxation and Revenue Department.  The state handles local disbursements to each local authority.

New Mexico State Universal Service Fund

The New Mexico State USF provides funding, in coordination with Federal Programs, for qualified New Mexico schools, libraries, healthcare facilities, and rural telecom companies.  The current fee is $1.08 per telephone connection.  The fee is remitted monthly to the New Mexico USF.

New Mexico Relay Service Fee

The New Mexico Relay Service Fee helps provide fully telephone accessibility to people who are deaf, hard of hearing, or speech disabled.  Specially trained Communication Assistants complete all calls and stay on-line to relay messages either electronically over a Teletypewriter (TTY) or verbally to hearing parties.  This service, known as Relay New Mexico, is available 24 hours a day, 365 days a year.   The surcharge on the monthly bills is thirty-three hundredths of one percent (.33%) of gross intrastate calls.  The fee is collected and remitted monthly to the New Mexico Taxation and Revenue Department.