Vermont's community access television stations are facing a fiscal crisis, and lawmakers are trying to figure out a funding stream to support their work.
The Senate Finance Committee is considering a bill, S.181, which would set up a new fee on streaming services such as Netflix and Disney+.
If the bill passes as written, then streaming companies would have to pay an assessment equal to 5% of their gross revenue derived from their business in Vermont.
The new tax is expected to bring in between $6 million and $7.6 million, according to the Joint Fiscal Office.
Most of that money would go into a fund that would support grants for the 24 Public, Educational and Governmental — or PEG — TV providers across the state.
The stations have traditionally received funding from cable companies, which are required to fund the stations as a part of their state permits.
That funding currently makes up about 90% of the revenue coming into the PEG stations.
But as consumers “cut the cable cord,” leaving cable companies behind as they access more of their entertainment over streaming services, that funding stream is drying up.
As the funding gap has continued to grow, the stations have received $2.4 million in federal COVID relief money, as well as general funds, since 2020.
But Lauren-Glenn Davitian, the public policy director for CCTV Center for Media and Democracy, said the stations are asking lawmakers to address the issue during this session.
“We’re seeing the decline in cable revenue. It’s real. It’s affecting the community media centers,” Davitian said. “The Legislature has helped us with one-time support, but I think that we’re all pretty aligned in finding a long-term solution so that we’re not continuously going back for one-time support.”
While cable subscriptions are expected to remain flat over the next six years, the costs of operating the PEG stations will go up, according to a recent report from the Vermont Access Network, the advocacy group that represents the stations.
By 2030, Vermont’s stations could face a $4.6 million revenue gap, according to the report.
The Senate Finance Committee heard from a number of streaming service lobbyists that opposed the new tax.
“New fees would drive up streaming costs for Vermont households,” according to the group Streaming Innovation Alliance, which represents the streaming services Netflix, Paramount+ and Max, among others.
“Imposing franchise fees on streaming would be especially regressive and harmful to people and communities least able to afford them,” the national advocacy group wrote in a letter to the Senate Finance Committee.
The bill is now in the Senate Committee on Appropriations.
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