Absolutely. They could avoid the reproduction royalty by not making reproductions. But I'll tell you something; since the tariff was introduced, not a single radio station has gone back from using copies. They know perfectly well that there are costs incumbent upon making those copies. They pay us the royalties. They also pay for the reproduction of the sound recordings.
One station did attempt very briefly to say they weren't making copies anymore and they'd go back to loading them by hand. It lasted less than two months. Why? Because the advantages they get from the technology more than outweigh the costs.