This bill proposes the establishment of a public, educational, or governmental (PEG) programming fee for digital video service providers operating in Minnesota. It defines key terms such as "digital video service provider," "gross revenues," and "PEG programming," and mandates that local units of government impose a PEG programming fee of five percent on the gross revenues derived from digital entertainment services provided to subscribers within their jurisdiction. The bill outlines the payment process, requiring providers to remit the fees quarterly, along with documentation of the revenue calculations. Additionally, it allows local governments to use the collected fees for capital or operating expenses related to PEG programming and mandates record-keeping and reporting requirements for the service providers.

The bill also includes provisions for enforcement and penalties for non-compliance. Digital video service providers that fail to remit the fees on time may face monetary penalties based on their gross revenues, with increased penalties for fraudulent actions or failure to provide required records for audits. However, the bill exempts providers with gross revenues below $250,000 from these requirements and clarifies that it does not grant local governments the authority to regulate service rates or ownership of public property. Overall, the legislation aims to ensure that digital video service providers contribute to local PEG programming while establishing a framework for compliance and accountability.