Doing Business in the New Technology: Problems for College and University Counsel

The article is written from the perspective of counsel to several states, universities, colleges, and not-for-profit corporations for telecommunications and other matters. The article emphasizes public broadcasting and related telecommunications facilities typically found on campuses. It discusses recent regulatory changes which allow remunerative use to be made of these facilities when their primary purposes have been served and excess time remains. It also discusses potential obstacles to remunerative use posed by state statutes, suggests how to avoid common carrier status providing entrepreneurial services, and discusses the impact of the federal unrelated business income tax on earnings from telecommunications enterprises. Unlike commercial businesses, colleges and universities may be taxed doubly, in effect. Congress has acted in perilously contradictory fashion in urging public telecommunications licensees to become self-sufficient and nondependent upon federal funds.