Document Number
08-119
Tax Type
Communications Sales and Use Tax
Description
Taxpayer provides satellite services to the residents in a gated community; Public Rights-of-Way Use Fee
Topic
Statute of Limitations
Date Issued
06-26-2008

June 26, 2008





Re: § 58.1-1824 Application: Public Rights-of-Way Use Fee

Dear *****:

This is in response to your letter submitted on behalf of *****(the "Taxpayer") regarding the Public Rights-of-Way Use fee for the period January 2007 through August 2007. I apologize for the delay in responding to your appeal.

FACTS


The Taxpayer provides satellite services to the residents in a gated community in Virginia. The Taxpayer currently has a cable franchise with the FCC and for its service, and it crosses public rights-of-way using a fiber infrastructure that it owns. The Taxpayer takes down the signal from the satellite to a headend located at the property. The signal is then distributed to the single family homes on a bulk basis. The home owners' association is billed for the bulk service. The Taxpayer has filed and paid the Virginia communications tax for the aforementioned period and now seeks a wavier of the Public Rights-of-Way fee.

DETERMINATION


Pursuant to Va. Code § 58.1-1821, "[a]ny person assessed with any tax administered by the Department of Taxation may, within ninety days from the date of such assessment, apply for relief to the Tax Commissioner." The request for relief filed by the Taxpayer was not filed within the 90-day statute of limitations. Accordingly, the Taxpayer's request for relief will be addressed in accordance with Va. Code § 58.1-1824, which provides a protective claim for refund for "[a]ny person who has paid an assessment of taxes administered by the Department of Taxation" and seeks a refund of such assessment.

Virginia Code § 56-468.1 sets forth the Public Rights-of-Way Use Fee. Section B 2 of the statute provides that the Public Rights-of-Way Use Fee "is imposed on all cable operators that use the public rights-of-way." Virginia Code § 15.2-2108.1:1 A defines a cable operator as:
    • Any person or group of persons that (i) provides cable service over a cable system and directly or through one or more affiliates owns a significant interest in such cable system or (ii) otherwise controls or is responsible for, through any arrangement, the management and operation of a cable system, whether or not the operator has entered into a franchise agreement with a locality. Cable operator does not include a provider of wireless or direct-to-home satellite transmission service.
    • The statute further defines cable service as:
    • The one-way transmission to subscribers of (i) video programming as defined in 47 U.S.C. § 522(20) or (ii) other programming service, and subscriber interaction, if any, which is required for the selection of such video programming or other programming service. Cable service does not include any video programming provided by a commercial mobile service provider as defined in 47 U.S.C. § 332(d) and any direct-to-home satellite service as defined in 47 U S.C. § 303(v).

Virginia Code § 15.2-2108.1:1 B provides that "[n]otwithstanding any other provision of law, if a cable operator uses the public rights-of-way the cable operator shall be subject to the Public Rights-of-Way Use Fee as provided in § 56-468.1."

The Taxpayer entered into a cable television franchise agreement with *****. Based on this agreement, the Taxpayer is a cable operator that provides cable service to the residents in the gated community. Additionally, the Taxpayer's fiber infrastructure crosses public rights-of-way. Pursuant to Va. Code §§ 56-468.1 and 15.2-2108.1:1, the Taxpayer is liable for the Public Rights-of-Way Use Fee. For the period at issue, the Taxpayer correctly charged, collected and remitted the tax to the Department. Accordingly, the Taxpayer's request for a waiver of tax, penalty and interest remitted during this period is denied. The Taxpayer should continue to charge and collect the fee from its subscribers and should continue to remit the fee to the Department. A copy of the Guidelines and Rules for the Virginia Communications Taxes is enclosed.

If you have any questions about this response, you may contact ***** in the Department's Office of Tax Policy, Appeals and Rulings, at *****.
                • Sincerely,


                • Janie E. Bowen
                  Tax Commissioner





AR/1-2050477649.P


Rulings of the Tax Commissioner

Last Updated 08/25/2014 16:46