On February 27, 2001 (66 FR 12589), FSIS published the notice of proposed rulemaking (NPRM) “Performance Standards for the Production of Processed Meat and Poultry Products.” These proposed performance standards would require, among other things, that the processing methods, such as heat treatments, fermentation, drying, or salt-curing, used by each establishment that produces RTE meat or poultry products achieve specific levels of pathogen lethality, in terms of a very low probability that Salmonella organisms will survive or specific log10 reductions of Salmonella in the products. FSIS also proposed that each establishment that produces RTE or partially cooked meat or poultry products use product stabilization processes, such as cooling following a heat treatment, that limit multiplication of C. perfringens to no more than 1 log10 and ensure no multiplication of C. botulinum. Partly in response to comments received on the NPRM, FSIS decided to conduct scientific risk assessments of the proposed lethality and stabilization standards.

FSIS has recently completed a quantitative risk assessment of Salmonella in RTE meat and poultry products. The risk assessment provides important data that the Agency has been using in deciding whether to adopt a lethality performance standard for the processing of RTE products, and, if so, what the standard should be.

The Agency has also completed “A Risk Assessment for Clostridium perfringens in Ready-to-Eat and Partially Cooked Foods” to estimate the risk of diarrheal illness from C. perfringens growth during stabilization of the products. The relative growth of C. botulinum during stabilization was also evaluated. FSIS is using the information from this risk assessment to develop a stabilization performance standard for the processing of such products.

FSIS is making these risk assessments available to the public and requests comment on them. The Agency is also making available in the docket room reference materials used in support of the risk assessments and additional data relating to the development of the proposed performance standards, as requested in comments on the NPRM.

Public awareness of all segments of rulemaking and policy development is important. Consequently, in an effort to ensure that the public and, in particular, minorities, women, and persons with disabilities are aware of this notice, FSIS will announce it on-line through the FSIS Web page located at http://www.fsis.usda.gov/regulations/2005_Notices_Index/.

FSIS also will make copies of this Federal Register publication available through the FSIS Constituent Update, which is used to provide information regarding FSIS policies, procedures, regulations, Federal Register notices, FSIS public meetings, and recalls, as well as other types of information that could affect or would be of interest to our constituents and stakeholders. The update is communicated via Listserv, a free electronic mail subscription service for industry, trade, and farm groups, consumer interest groups, allied health professionals, scientific professionals, and other individuals who have requested to be included. The update is available on the FSIS Web page. Through Listserv and the Web page, FSIS is able to provide information to a much broader and more diverse audience.

In addition, FSIS offers an electronic mail subscription service which provides an automatic and customized notification when popular pages are updated, including Federal Register publications and related documents. This service is available at http://www.fsis.usda.gov/news_and_events/email_subscription/ and allows FSIS customers to sign up for subscription options across eight categories. Options range from recalls to export information to regulations, directives, and notices. Customers can add or delete subscriptions themselves and have the option to protect their accounts with passwords.

OFHEO invites comments on all aspects of the proposed regulation and will take all comments into consideration before issuing the final regulation. All comments received will be posted without change to http://www.ofheo.gov, including any personal information provided. Copies of all comments received will be available for examination by the public on business days between the hours of 10 a.m. and 3 p.m., at the Office of Federal Housing Enterprise Oversight, Fourth Floor, 1700 G Street NW., Washington, DC 20552. To make an appointment to inspect comments, please call the Office of General Counsel at (202) 414-6924.

How do I comment on this proposed AD? We invite you to submit any written relevant data, views, or arguments regarding this proposal. Send your comments to an address listed under ADDRESSES. Include the docket number, “FAA-2005-20515; Directorate Identifier 2005-CE-09-AD” at the beginning of your comments. We will post all comments we receive, without change, to http://dms.dot.gov, including any personal information you provide. We will also post a report summarizing each substantive verbal contact with FAA personnel concerning this proposed rulemaking. Using the search function of our docket Web site, anyone can find and read the comments received into any of our dockets, including the name of the individual who sent the comment (or signed the comment on behalf of an association, business, labor union, etc.). This is docket number FAA-2005-20515; Directorate Identifier 2005-CE-09-AD. You may review the DOT's complete Privacy Act Statement in the Federal Register published on April 11, 2000 (65 FR 19477-78) or you may visit http://dms.dot.gov.

Are there any specific portions of this proposed AD I should pay attention to? We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this proposed AD. If you contact us through a nonwritten communication and that contact relates to a substantive part of this proposed AD, we will summarize the contact and place the summary in the docket. We will consider all comments received by the closing date and may amend this proposed AD in light of those comments and contacts.

Where can I go to view the docket information? You may view the AD docket that contains the proposal, any comments received, and any final disposition in person at the DMS Docket Offices between 9 a.m. and 5 p.m. (eastern standard time), Monday through Friday, except Federal holidays. The Docket Office (telephone 1-800-647-5227) is located on the plaza level of the Department of Transportation NASSIF Building at the street address stated in ADDRESSES. You may also view the AD docket on the Internet at http://dms.dot.gov. The comments will be available in the AD docket shortly after the DMS receives them.

What events have caused this proposed AD? The Federal Office for Civil Aviation (FOCA), which is the airworthiness authority for Switzerland, recently notified FAA that an unsafe condition may exist on all Pilatus Model PC-6 airplanes. The FOCA reports that the lower attachment bracket of the horizontal stabilizer actuator broke on a PC-6 airplane. This resulted in an emergency landing outside the airport.

The FOCA reports two other instances of total failure of the stabilizer trim attachment on airplanes in-service.

What is the potential impact if FAA took no action? If not detected and corrected, defects in the stabilizer-trim attachment and surrounding structural components could cause the stabilizer-trim attachment to fail. This failure could lead to loss of control of the airplane.

Is there service information that applies to this subject? Pilatus has issued PC-6 Service Bulletin No. 53-001, dated February 16, 2005.

What are the provisions of this service information? The service bulletin includes procedures for:

What action did the FOCA take? The FOCA classified this service bulletin as mandatory and issued Swiss AD Number HB-2005-080, effective date March 2, 2005, in order to ensure the continued airworthiness of these airplanes in Switzerland.

Did the FOCA inform the United States under the bilateral airworthiness agreement? These Pilatus PC-6 airplanes are manufactured in Switzerland and are type-certificated for operation in the United States under the provisions of section 21.29 of the Federal Aviation Regulations (14 CFR 21.29) and the applicable bilateral airworthiness agreement. Fairchild also manufactured these airplanes under a United States licensing agreement with Pilatus under the same type certificate.

Under this bilateral airworthiness agreement, the FOCA has kept us informed of the situation described above.

What has FAA decided? We have examined the FOCA's findings, reviewed all available information, and determined that AD action is necessary for products of this type design that are certificated for operation in the United States.

Since the unsafe condition described previously is likely to exist or develop on other Pilatus PC-6 airplanes of the same type design that are registered in the United States, we are proposing AD action to detect and correct defects in the stabilizer-trim attachment and surrounding structural components, which could result in failure of the stabilizer-trim attachment. This failure could lead to loss of control of the airplane.

What would this proposed AD require? This proposed AD would require you to incorporate the actions in the previously-referenced service bulletin.

How does the revision to 14 CFR part 39 affect this proposed AD? On July 10, 2002, we published a new version of 14 CFR part 39 (67 FR 47997, July 22, 2002), which governs FAA's AD system. This regulation now includes material that relates to altered products, special flight permits, and alternative methods of compliance. This material previously was included in each individual AD. Since this material is included in 14 CFR part 39, we will not include it in future AD actions.

How many airplanes would this proposed AD impact? We estimate that this proposed AD affects 41 airplanes in the U.S. registry.

What would be the cost impact of this proposed AD on owners/operators of the affected airplanes? We estimate the following costs to do the proposed inspections:

We estimate the following costs to do any necessary replacements that would be required based on the results of the proposed inspections. We have no way of determining the number of airplanes that may need these replacements:

What authority does FAA have for issuing this rulemaking action? Title 49 of the United States Code specifies the FAA's authority to issue rules on aviation safety. Subtitle I, section 106 describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the agency's authority.

We are issuing this rulemaking under the authority described in subtitle VII, part A, subpart III, section 44701, “General requirements.” Under that section, Congress charges the FAA with promoting safe flight of civil aircraft in air commerce by prescribing regulations for practices, methods, and procedures the Administrator finds necessary for safety in air commerce. This regulation is within the scope of that authority because it addresses an unsafe condition that is likely to exist or develop on products identified in this AD.

Would this proposed AD impact various entities? We have determined that this proposed AD would not have federalism implications under Executive Order 13132. This proposed AD would not have a substantial direct effect on the States, on the relationship between the National Government and the States, or on the distribution of power and responsibilities among the various levels of government.

Would this proposed AD involve a significant rule or regulatory action? For the reasons discussed above, I certify that this proposed AD:

1. Is not a “significant regulatory action” under Executive Order 12866;

2. Is not a “significant rule” under the DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979); and

3. Will not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

We prepared a summary of the costs to comply with this proposed AD and placed it in the AD Docket. You may get a copy of this summary by sending a request to us at the address listed under ADDRESSES. Include “AD Docket FAA-2005-20515; Directorate Identifier 2005-CE-09-AD” in your request.

Accordingly, under the authority delegated to me by the Administrator, the Federal Aviation Administration proposes to amend 14 CFR part 39 as follows:

Interested parties are invited to participate in this proposed rulemaking by submitting such written data, views, or arguments as they may desire. Comments that provide the factual basis supporting the views and suggestions presented are particularly helpful in developing reasoned regulatory decisions on the proposal. Comments are specifically invited on the overall regulatory, aeronautical, economic, environmental, and energy-related aspects of the proposal.

Communications should identify both docket numbers (FAA Docket No. FAA-2004-18612 and Airspace Docket No. 04-AWA-05) and be submitted in triplicate to the Docket Management System (see ADDRESSES section for address and phone number). You may also submit comments through the Internet at http://dms.dot.gov.

Commenters wishing the FAA to acknowledge receipt of their comments on this action must submit with those comments a self-addressed, stamped postcard on which the following statement is made: “Comments to Docket Nos. FAA-2004-18612 and Airspace Docket No. 04-AWA-05.” The postcard will be date/time stamped and returned to the commenter.

All communications received on or before the specified closing date for comments will be considered before taking action on the proposed rule. The proposal contained in this action may be changed in light of comments received. All comments submitted will be available for examination in the public docket both before and after the closing date for comments. A report summarizing each substantive public contact with FAA personnel concerned with this rulemaking will be filed in the docket.

An electronic copy of this document may be downloaded through the Internet at http://dms.dot.gov. Recently published rulemaking documents can also be accessed through the FAA's Web page at http://www.faa.gov or the Federal Register's Web page at http://www.gpoaccess.gov/fr/index.html.

You may review the public docket containing the proposal, any comments received, and any final disposition in person in the Dockets Office (see ADDRESSES section for address and phone number) between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. An informal docket may also be examined during normal business hours at the office of the Regional Air Traffic Division, Federal Aviation Administration, 15000 Aviation Boulevard, Lawndale, CA 90261.

Persons interested in being placed on a mailing list for future NPRM's should contact the FAA's Office of Rulemaking, (202) 267-9677, for a copy of Advisory Circular No. 11-2A, Notice of Proposed Rulemaking Distribution System, which describes the application procedure.

In July 1971, the FAA issued a final rule establishing the LAX Terminal Control Area (TCA). This area was later renamed as Class B airspace as a result of the Airspace Reclassification Final Rule (56 FR 65638). Since its establishment, the LAX Class B airspace area has undergone several modifications. The current Class B airspace area was developed in the early 1990's and revised in 1996 (96 FR 66902). From January 2003 to February 2004, reviews were conducted by SCT and the results presented to the Southern California Airspace Users Working Group (SCAUWG) at regularly scheduled meetings. These reviews noted several areas where boundary locations and identification could be improved and identified areas in need of modification to ensure the containment of Standard Terminal Arrival Routes (STAR) within the LAX Class B airspace. The proposed LAX Class B airspace area modifications will address these matters.

As announced in the Federal Register (68 FR 64832), informal airspace meetings were held on January 20, 2004, at the Embassy Suites Hotel El Segundo, CA; January 22, 2004, at the James Monroe High School, North Hills, CA; January 27, 2004, at the Marriot Hotel, Riverside, CA; and January 29, 2004, at the Costa Mesa Neighborhood Community Center, Costa Mesa, CA. Interested airspace users had an opportunity to present their views and offer suggestions regarding planned modifications to the LAX Class B airspace area. All comments received during the informal airspace meetings and the subsequent comment period was considered in developing this proposal.

Five commenters suggested the FAA raise the floor of the proposed area N to 5,500 feet. They stated raising the floor of the proposed area N would allow easier VFR transition for southeast bound aircraft. They considered the 3,500 foot mandatory altitude of the Special Air Traffic Rules Area for southeasterly bound VFR aircraft to be too low, especially at night. Three other commenters suggested the FAA raise the floor of area N from the proposed 5,000 feet to 6,000 feet. They indicated raising the floor would provide additional terrain clearance for aircraft transitioning the Santa Monica Mountains to the southeast, and would also result in the benefit of additional altitudes in the Special Air Traffic Rules Area, which would provide controller workload relief.

The FAA does not agree with these comments. This proposal would not change existing arrival or departure routes or the altitudes used on these routes. Raising the floor of the proposed area N would not provide containment of LAX arrival traffic within the Class B airspace. Additionally, no changes to the Special Air Traffic Rules Area are associated with this proposal, therefore, comments addressing Special Air Traffic Rules Area changes are outside the scope of this proposal.

Several commenters recommended moving the northwestern boundary of proposed area N (originally proposed SMO 253 degree radial) further south to allow VFR flight along the shoreline off of Point Dume.

The FAA agrees. In response to comments requesting more room for VFR flight in the vicinity of Point Dume so that VFR aircraft can follow the shoreline, the proposed southern boundary of area N was moved south, and realigned along the Santa Monica (SMO) VOR 252 degree radial. As proposed, this will provide VFR aircraft the flexibility to navigate over the water along the shoreline near Point Dume.

One commenter requested that the FAA raise the 5,000 foot floor over Palos Verdes, to allow more GA access to and from Torrance (TOA) and Hawthorne (HHR) airports. Raising the floor would make some airspace revert to Class E airspace which means pilots would not have to be in contact with ATC. The commenter believes, raising the 5,000 foot floor south of LAX would provide more available altitudes in the Special Air Traffic Rules Area. The commenter maintains that a higher floor would prompt aircraft currently using the Hollywood Park Route to move to the Special Air Traffic Rules Area, where communication with ATC is not required. He believes this would reduce the workload for the controller in the Hollywood Park Route Sector. One commenter suggested that the FAA either re-route LAX turboprop departures landing at Santa Ana (SNA) or Ontario (ONT) around Palos Verdes, or raise the floor altitude of the proposed LAX Class B airspace southeast of LAX (area H) to increase the crossing altitude of turboprop aircraft that overfly Palos Verdes. Four other commenters suggested raising the 5,000 foot floor over the Palos Verdes Peninsula (area H) to 6,000 feet. The Mayor of Palos Verdes Estates requested that the FAA raise the floor of the Class B airspace over the Palos Verdes peninsula to 7,000 feet to reduce noise from turboprop aircraft over flights. Additionally, the Chairman of the Los Angeles Noise Roundtable requested the FAA determine if the 5,000 foot floor above the northern portion of the Palos Verdes Peninsula could be raised in an effort to help reduce noise from overflights of the community.

The FAA does not agree with these requests or suggestions for the following reasons. This proposal does not change existing arrival/departure routes or the altitudes used on these routes. No changes to the Special Air Traffic Rules Area, Hollywood Park Route, or LAX departure routes are associated with this proposal, therefore, comments addressing these items are outside the scope of this proposal. The FAA has reviewed the issue of raising the floor of the proposed area H and determined that such action would result in departure and arrival aircraft exiting the LAX Class B airspace area while in the LAX terminal area. This would not be consistent with safe and efficient management of air traffic in the LAX Class B airspace area. Additionally, the FAA believes the 5,000 foot floor of the LAX Class B in area H provides non-participating aircraft ample airspace for access to, from, or between the TOA and HRR airports, which have field elevations of 103 feet and 66 feet, respectively.

Several commenters suggested publishing airspace block “ID letters” (from the Class B legal description) on the Terminal Area Chart and publishing the VOR radials on the proposed Los Angeles Charted VFR Flyway Planning Routes portion of the Terminal Area Chart, the same as are currently shown on the San Diego Terminal Area Chart. Several commenters stated a preference for visual landmarks.

The FAA agrees with these suggestions, and will publish this information on the Los Angeles Terminal Area Chart and the Los Angeles Charted VFR flyway Planning Chart. Existing landmarks will be retained on the charts.

Numerous comments were received concerning the proposed description. Several commenters suggested using single north/south VOR radials to define the eastern edges of proposed areas E, F, and G, as opposed to the multiple north/south radials presented. Other commenters suggested the FAA simplify the east boundary of the Class B to just 7,000 and 8,000 feet as opposed to 7,000/8,000/9,000 feet as proposed. Another commenter pointed out that it may be difficult to navigate the eastern portion of the Class B on a VFR flight direct to Lake Arrowhead from SNA airport. Some suggested aligning the northern boundary of the Class B with a Pomona (POM) or Ventura (VTU) VOR radials. One comment suggests using a Seal Beach (SLI) radial to define the division south of Long Beach (LGB) as opposed to using the LGB runway 16R extended centerline.

The FAA reviewed the possibilities for using VOR radials to simplify the eastern Class B boundary lines, and agrees that re-alignment of area E, F, and G can be matched with El Toro (ELB) VOR radials. The ELB 332 and ELB 342 radials have been incorporated into the propose description to define areas E, F, and G. However, locations and useable parameters of the Ventura and Pomona VOR's do not allow for their use in defining the northern boundary of the Class B. Moving the western boundary of the proposed area J to match a SLI radial would not provide containment of LAX arrival traffic within the Class B airspace area. Simplifying the east boundary of the Class B to one large 7,000 or 8,000 foot area would take more airspace than needed, creating unnecessary airspace restrictions on non-participating aircraft.

One commenter suggested the FAA redefine easternmost boundaries of proposed, new, and existing areas as DME arcs. Another disagreed with the use of DME arcs and preferred visual landmarks.

The FAA does not agree with the comments concerning DME Arc's, but agrees with the use of visual landmarks to the extent practicable. Class B airspace designed using DME Arc's, exclusive of other options, would not be compatible with operational requirements around LAX. Considering the unique requirements of the LAX terminal area, adopting a Class B design based on circles centered on the airport reference point would create more Class B airspace than necessary and have a negative impact on GA operations.

A commenter suggested modifying the southwest portion of area A, by raising the floor from the current surface to 2,000 feet or moving the area further offshore. Another commenter suggested lowering the ceiling of the LAX class B airspace from 10,000 to 8,000 feet to accommodate small aircraft that cannot climb above 10,000 feet.

The FAA does not agree. Raising the floor of area A, moving it further offshore, or lowering the ceiling of the entire Class B airspace area, would not provide for the containment of arrival or departure aircraft within the confines of the Class B airspace.

Seven comments were received in support of the proposal, the Aircraft Owners and Pilots Association (AOPA) cited the work of the Southern California Airspace User Working Group and the collaborative efforts of the FAA in developing this proposal. They pointed out that the overall modifications will prove beneficial to the general aviation community and result in a reduction of approximately 100 square miles of existing Class B airspace.

The FAA agrees with these comments. This proposal will result in an overall reduction of 100 square miles of existing Class B airspace.

The FAA is proposing an amendment to Title 14 Code of Federal Aviation Regulations (14 CFR) part 71 (part 71) to modify the LAX Class B airspace area. Specifically, this action (depicted on the attached chart) proposes to expand the eastern boundary to ensure the containment of the LAX STAR's within Class B airspace and reconfigure several existing areas, correcting areas of inefficiencies identified during public meetings and during reviews of the existing Class B airspace area by SCT. These proposed modifications reduce the overall size of the LAX Class B airspace area, improve the containment of turbo-jet aircraft within the airspace, and improve the alignment of lateral boundaries with VOR radials and visual landmarks for improved VFR navigation.

The following are the proposed revisions for each area of the LAX Class B airspace area:

Area A: The east/west line along the northwestern boundary will be aligned to the SMO 252(M)/267(T) radial to provide redundant reference for VFR navigation, and allow VFR aircraft to transition along the shoreline at Point Dume.

Area B: No change.

Area C: The east/west and northwest/southeast lines along the southern boundary will be aligned with the SLI 300(M)/315(T) radial and PDZ 252(M)/267(T) radial providing a redundant reference for VFR navigation.

Area D: The east/west line along the southern boundary to will be aligned with the PDZ 252(M)/267(T) radial to provide redundant reference for VFR navigation.

Area E: The east/west line along the southern boundary aligned with the PDZ 252(M)/267(T) radial, and the northern boundary aligned with the SMO 071(M)/086(T) radial. The eastern boundary will be aligned with the ELB 332(M)/347(T) radial. This modification will align the eastern boundary with existing VOR radials to provide redundant reference for VFR navigation, and lowers the floor to 7000 feet, ensuring containment of aircraft descending on the LAX profile.

Area F: The east/west line along the southern boundary will be aligned with the PDZ 252(M)/267(T) radial, and the northern boundary aligned with the SMO 071(M)/086(T) radial. The western boundary will be aligned with Block E of the Class B airspace area along ELB 332(M)/347(T) radial. The eastern boundary will be aligned with the ELB 342(M)/357(T) radial. These modifications will align the boundaries with existing VOR radials providing a redundant reference for VFR navigation, and lower the floor to 8000 feet, ensuring containment of aircraft descending on the LAX profile.

Area G: The east/west line along the southern boundary will be aligned with the PDZ 252(M)/267(T) radial, and the northern boundary will be aligned with the SMO 071(M)/086(T) radial. The western boundary will be aligned with Block F along ELB 342(M)/357(T) radial. The eastern boundary will be aligned with the ELB 352(M)/007(T) radial, and the POM 112(M)/127(T) radial. These modifications will align the boundaries with existing VOR radials providing a redundant reference for VFR navigation. This area will expand the existing LAX Class B airspace area slightly to ensure containment of aircraft descending on the LAX profile.

Area H: The east/west and northwest/southeast lines along the northern boundary will be aligned with the SLI 300(M)/315(T) radial and PDZ 252(M)/267(T) radial to provide a redundant reference for VFR navigation.

Area I: The east/west line along the northern boundary will be aligned with the PDZ 252(M)/267(T) radial to provide a redundant reference for VFR navigation.

Area J: The southern boundary will be aligned with the ELB 226(M)/241(T) radial. The eastern boundary will be shortened to end at the ELB 226(M)/241(T) radial. The western boundaries will be realigned to the LAX 127(M)/142(T) radial and the LGB extended runway 16R centerline. These modifications will align the boundaries with existing VOR radials where possible providing a redundant reference for VFR navigation.

Area K: The southern boundary will be aligned with the ELB 248(M)/263(T) radial to provide a redundant reference for VFR navigation, and the eastern boundary will be realigned with the LGB extended runway 16R centerline.

Area L: The southern boundary will be aligned with the ELB 248(M)/263(T) radial to provide a redundant reference for VFR navigation.

Area M: The northern boundaries will be aligned with the SMO 252(M)/267(T) radial and VNY 220(M)/235(T) radial to provide a redundant reference for VFR navigation.

Area N: The western boundary will be aligned with the VNY 220(M)/235(T) radial. The southern boundary aligned with the SMO 252(M)/267(T) radial. These modifications align the boundaries with existing VOR radials to provide a redundant reference for VFR navigation.

Changes to Federal Regulations must undergo several economic analyses. First, Executive Order 12866 directs that each Federal agency shall propose or adopt a regulation only upon a reasoned determination that the benefits of the intended regulation justify its costs. Second, the Regulatory Flexibility Act requires agencies to analyze the economic effect of regulatory changes on small businesses and other small entities. Third, the Office of Management and Budget directs agencies to assess the effect of regulatory changes on international trade. In conducting these analyses, the FAA has determined that this proposed rule: (1) Would generate benefits that justify its circumnavigation costs and is not a “significant regulatory action” as defined in the Executive Order; (2) is not significant as defined in the Department of Transportation's Regulatory Policies and Procedures; (3) would not have a significant impact on a substantial number of small entities; (4) would not constitute a barrier to international trade; and (5) would not contain any Federal intergovernmental or private sector mandate. These analyses are summarized here in the preamble, and the full Regulatory Evaluation is in the docket.

This action would modify the LAX Class B airspace area. The proposed rule would reconfigure the area's lateral boundaries.

This action would generate benefits for system users and the FAA in the form of enhanced operational efficiency and simplified navigation in the LAX terminal area. These modifications would impose some circumnavigation costs on operators who want to remain outside the Class B airspace area. Although the overall impact of our proposal would be to reduce one hundred square miles of the Class B airspace in the eastern most sectors of the Class B airspace there would be some increase Class B airspace where we have proposed to raise the ceiling. Some pilots may choose to circumnavigate the eastern sectors. However, the cost of circumnavigation in the “E” sector is considered to be small. Moreover, the overall impact will reduce circumnavigation costs because of the reduction in the “N” sector. We're also proposing to reduce that sector both laterally and vertically. Thus, the FAA has determined this proposed rule would be cost-beneficial.

The Regulatory Flexibility Act of 1980 establishes “as a principle of regulatory issuance that agencies shall endeavor, consistent with the objective of the rule and of applicable statutes, to fit regulatory and informational requirements to the scale of the business, organizations, and governmental jurisdictions subject to regulation.” To achieve that principal, the Act requires agencies to solicit and consider flexible regulatory proposals and to explain the rationale for their actions. The Act covers a wide-range of small entities, including small businesses, not-for-profit organizations and small governmental jurisdictions.

Agencies must perform a review to determine whether a proposed or final rule will have a significant economic impact on a substantial number of small entities. If the determination is that it will, the agency must prepare a regulatory flexibility analysis (RFA) as described in the Act.

However, if an agency determines that a proposed or final rule is not expected to have a significant economic impact on a substantial number of small entities, section 605(b) of the 1980 Act provides that the head of the agency may so certify and an RFA is not required. The certification must include a statement providing the factual basis for this determination, and the reasoning should be clear.

This proposed rule may impose some circumnavigation costs on individuals operating in the LAX terminal area; but the proposed rule would not impose any costs on small business entities. Operators of general aviation aircraft are considered individuals, not small business entities and are not included when performing a regulatory flexibility analysis. Flight schools are considered small business entities. However, the FAA assumes that they provide instruction in aircraft equipped to navigate in Class B airspace given they currently provide instruction in the LAX terminal area. Air taxis are also considered small business entities, but are assumed to be properly equipped to navigate Class B airspace because it is part of their current practice. Therefore, these small entities should not incur any additional costs as a result of the proposed rule. Accordingly, pursuant to the Regulatory Flexibility Act, 5 U.S.C. 605(b), the Federal Aviation Administration certifies this rule would not have a significant economic impact on a substantial number of small entities. The FAA solicits comments from affected entities with respect to this finding and determination.

The Trade Agreement Act of 1979 prohibits Federal agencies from engaging in any standards or related activities that create unnecessary obstacles to the foreign commerce of the United States. Legitimate domestic objectives, such as safety, are not considered unnecessary obstacles. The statute also requires consideration of international standards and where appropriate, that they be the basis for U.S. standards.

The proposed rule is not expected to affect trade opportunities for U.S. firms doing business overseas or for foreign firms doing business in the United States.

Title II of the Unfunded Mandates Reform Act of 1995 (the Act), enacted as Public Law 0104-4 on March 22, 1995, requires each Federal agency, to the extent permitted by law, to prepare a written assessment of the effects of any Federal mandate in a proposed or final agency rule that may result in the expenditure of $100 million or more (when adjusted annually for inflation) in any one year by State, local, and tribal governments in the aggregate, or by the private sector. Section 204(a) of the Act, 2 U.S.C. 1534(a), requires the Federal agency to develop an effective process to permit timely input by elected officers (or their designees) of State, local, and tribal governments on a proposed “significant intergovernmental mandate.” A “significant intergovernmental mandate” under the Act is any provision in a Federal agency regulation that would impose an enforceable duty upon State, local, and tribal governments in the aggregate of $100 million (adjusted annually for inflation) in any one year. Section 203 of the Act, 2 U.S.C. 1533, which supplements section 204(a), provides that, before establishing any regulatory requirements that might significantly or uniquely affect small governments, the agency shall have developed a plan, which, among other things, must provide for notice to potentially affected small governments, if any, and for a meaningful and timely opportunity for these small governments to provide input in the development of regulatory proposals.

This proposed rule does not contain any Federal intergovernmental or private sector mandates. Therefore, the requirements of Title II of the Unfunded Mandates Reform Act of 1995 do not apply.

In accordance with the Paperwork Reduction Act of 1980 (Pub. L. 96-511), there are no requirements for information collection associated with this action.

In view of the minimal or zero cost of compliance of this action and the enhancements to operational efficiency, the FAA has determined that this action would be cost-beneficial.

In consideration of the foregoing, the Federal Aviation Administration proposes to amend 14 CFR part 71 as follows:

The Saint Lawrence Seaway Development Corporation (SLSDC) and the St. Lawrence Seaway Management Corporation (SLSMC) of Canada, under international agreement, jointly publish and presently administer the St. Lawrence Seaway Tariff of Tolls (Schedule of Fees and Charges in Canada) in their respective jurisdictions.

The Tariff sets forth the level of tolls assessed on all commodities and vessels transiting the facilities operated by the SLSDC and the SLSMC. The SLSDC is proposing to revise 33 CFR 402.8, “Schedule of Tolls”, to reflect the fees and charges levied by the SLSMC in Canada beginning in the 2005 navigation season. With one exception, the changes affect the tolls for commercial vessels and are applicable only in Canada. The collection of tolls by the SLSDC on commercial vessels transiting the U.S. locks is waived by law (33 U.S.C. 988a(a)). Accordingly, no notice or comment is necessary on these amendments.

The SLSDC also proposes to amend 33 CFR 402.8 to increase the charge per pleasure craft per U.S. lock transited from $20 to $25 U.S., or $30 Canadian. This increase is needed due to higher operating costs at the locks. The per lock charge for pleasure craft transiting the Canadian locks will remain $20 Canadian, to be collected in Canadian dollars.

Privacy Act: Anyone is able to search the electronic form of all comments received into any of our dockets by the name of the individual submitting the comment (or signing the comment, if submitted on behalf of an association, business, labor union, etc.). You may review DOT's complete Privacy Act Statement in the Federal Register published on April 11, 2000 (Volume 65, Number 70; Pages 19477-78) or you may visit http://dms.dot.gov.

This proposed regulation involves a foreign affairs function of the United States and therefore Executive Order 12866 does not apply and evaluation under the Department of Transportation's Regulatory Policies and Procedures is not required.

I certify this proposed regulation will not have a significant economic impact on a substantial number of small entities. The St. Lawrence Seaway Regulations and Rules primarily relate to commercial users of the Seaway, the vast majority of whom are foreign vessel operators. Therefore, any resulting costs will be borne mostly by foreign vessels.

This proposed regulation does not require an environmental impact statement under the National Environmental Policy Act (49 U.S.C. 4321, et seq.) because it is not a major Federal action significantly affecting the quality of the human environment.

The Corporation has analyzed this proposed rule under the principles and criteria in Executive Order 13132, dated August 4, 1999, and has determined that this proposal does not have sufficient federalism implications to warrant a federalism assessment.

The Corporation has analyzed this proposed rule under Title II of the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4, 109 Stat. 48) and determined that it does not impose unfunded mandates on State, local, and tribal governments and the private sector requiring a written statement of economic and regulatory alternatives.

This proposed regulation has been analyzed under the Paperwork Reduction Act of 1995 and does not contain new or modified information collection requirements subject to the Office of Management and Budget review.

This is a summary of the Commission's Further Notice of Proposed Rulemaking in CC Docket No. 01-92, adopted on February 10, 2005 and released on March 3, 2005. The complete text of this Further Notice of Proposed Rulemaking is available for public inspection Monday through Thursday from 8 a.m. to 4:30 p.m. and Friday from 8 a.m. to 11:30 a.m. in the Commission's Consumer and Governmental Affairs Bureau, Reference Information Center, Room CY-A257, 445 Twelfth Street, SW., Washington, DC 20554. The complete text is also available on the Commission's Internet site at http://www. fcc.gov. Alternative formats are available to persons with disabilities by contacting Brian Millin at (202) 418-7426 or TTY (202) 418-7365. The complete text of the Further Notice of Proposed Rulemaking (FNPRM) may be purchased from the Commission's duplicating contractor, Best Copying and Printing, Inc., Room CY-B402, 445 Twelfth Street, SW., Washington, DC 20554, telephone (202) 863-2893, facsimile (202) 863-2898, or e-mail at http://www.bcpiweb.com.

1. In 2001, the Commission issued a Notice of Proposed Rulemaking to begin the process of intercarrier compensation reform, In the Matter of Developing a Unified Intercarrier Compensation Regime, CC Docket 01-92, Notice of Proposed Rulemaking, 66 FR 28410, May 23, 2001 (Intercarrier Compensation NPRM). The Commission received extensive comment on the Intercarrier Compensation NPRM including several proposals for comprehensive reform of the existing intercarrier compensation regime submitted by industry groups. With this FNPRM, the Commission continues the process of intercarrier compensation reform by seeking comment on the industry proposals, and on other matters raised in response to the Intercarrier Compensation NPRM.

2. The record in this proceeding shows that the three basic principles underlying existing intercarrier compensation regimes must be re-examined in light of significant market developments since the adoption of the access charge and reciprocal compensation rules. First, the existing compensation regimes are based on jurisdictional and regulatory distinctions that are not tied to economic or technical differences between services. These artificial distinctions distort the telecommunications markets at the expense of healthy competition. Moreover, the availability of bundled service offerings and novel services blur the traditional industry and regulatory distinctions that serve as the foundation of the current rules. Second, the existing compensation regimes are predicated on the recovery of average costs on a per-minute basis. Advancements in telecommunications infrastructure affect the way carrier costs are incurred and call into question to use of per-minute pricing. Third, under the existing regimes, the calling party's carrier, whether local exchange carrier (LEC), interexchange carrier (IXC), or commercial mobile radio service (CMRS) provider, compensates the called party's carrier for terminating the call. Developments in the ability of consumers to manage their own telecommunications services undermine the premise that the calling party is the sole cost causer and should be responsible for all the costs of a call. There are a number of additional criteria the commission must consider in assessing whether a particular proposal will help achieve its policy goals. For example, any proposal for reform of compensation mechanisms should address the impact of such changes on network interconnection rules. In addition, any reform proposal should explain the Commission's legal authority to adopt it.

3. Acknowledging that significant reform might be needed, the Commission requested comment in the Intercarrier Compensation NPRM on the appropriate goals of intercarrier compensation regulation in a competitive market and discussed specific goals that should be considered in evaluating a new regime. Based on the record, the Commission agrees with commenters that any new approach should promote economic efficiency. Preservation of universal service is another priority under the Act and the Commission recognizes that fulfillment of this mandate must be a consideration in the development of any intercarrier compensation regime. The Commission also agrees that any new intercarrier compensation approach must be competitively and technologically neutral.

4. Having concluded that there is an urgent need to reform the existing intercarrier compensation rules, the Commission now turns to the question of what reforms best serve the goals identified. In the Intercarrier Compensation NPRM, the Commission re-evaluated the rationale for the traditional calling party network pays (CPNP) regimes and identified new approaches to intercarrier compensation, including a bill-and-keep approach. Under a bill-and-keep approach, neither of the interconnecting networks charges the other network for terminating traffic that originates on the other carrier's network.

5. Attached as an appendix to the FNPRM is an analysis of comments filed regarding bill-and-keep in response to the Intercarrier Compensation NPRM. The views expressed in this staff analysis do not represent the views of, and are not endorsed by, the Commission.

6. In parallel with the Commission's consideration of the record developed in response to the Intercarrier Compensation NPRM, various industry groups have been negotiating proposals for comprehensive reform of federal and state intercarrier compensation mechanisms. These negotiations have resulted in proposals from a number of groups—the Intercarrier Compensation Forum (ICF), the Expanded Portland Group (EPG), the Alliance for Rational Intercarrier Compensation (ARIC), the Cost-Based Intercarrier Compensation Coalition (CBICC), and two rural LECs, Home Telephone Company and PBT Telecom (Home/PBT). In addition, the Commission discusses a statement of principles submitted by CTIA as well as a specific reform proposal filed by Western Wireless. The Commission also discusses a proposal by the National Association of State Utility Consumer Advocates (NASUCA) that would reduce certain intercarrier compensation rates. Moreover, the National Association of Regulatory Utility Commissioners (NARUC) has developed a set of principles that it believes should guide any consideration of intercarrier compensation reform.

7. Intercarrier Compensation Forum (ICF). The ICF is a diverse group of nine carriers that represent different segments of the telecommunications industry. The ICF has developed a comprehensive plan for reforming current network interconnection, intercarrier compensation, and universal service rules. With respect to network interconnection, the ICF plan establishes default technical and financial rules that generally require an originating carrier to deliver traffic to the “Edge” of a terminating carrier's network. With respect to compensation, the ICF plan would reduce per-minute termination rates from existing levels to zero over a six-year period. Revenue eliminated as a result of the transition to bill-and-keep under the ICF plan would be replaced by a combination of end-user charges and a new universal service support mechanism.

8. Expanded Portland Group (EPG). The EPG is a group of small and mid-sized rural LECs that came together to develop a proposal distinct from a bill-and-keep mechanism. Stage one of the EPG proposal is intended to address more immediate issues arising under the current regimes, including unidentified or “phantom” traffic, the scope of the ESP exemption, and the termination of traffic in the absence of agreements between carriers. In the second stage of the EPG plan, all per-minute rates would be set at the level of interstate access charges and a new Access Restructure Charge would be implemented to make up any revenue shortfall.

9. Alliance for Rational Intercarrier Compensation (ARIC)—Fair Affordable Comprehensive Telecom Solution (FACTS). ARIC is comprised of small telecommunications companies providing service in rural, high-cost areas. The FACTS plan developed by ARIC calls for a unified per-minute rate for all types of traffic that would be capped at a level based on a carrier's unseparated, interoffice embedded costs. In addition to more uniform rates, the FACTS plan calls for local retail rate rebalancing to benchmark levels established by state commissions, and includes a joint process by which the Commission and the states review the procedures and data to determine the appropriate unified rates.

10. Cost-Based Intercarrier Compensation Coalition (CBICC). The CBICC is a coalition of competitive LECs. Under the CBICC proposal, carriers would adopt a single termination rate in each geographic area that would apply to all types of traffic. The rate would be based on the incumbent LEC's cost of providing tandem switching, transport, and end office switching, calculated using the Commission's total element long-run incremental cost (TELRIC) methodology.

11. Home Telephone Company and PBT Telecom (Home/PBT). Home Telephone Company and PBT Telecom are rural LECs that developed an alternative proposal to those advanced by the larger groups discussed above. Under this proposal, all carriers offering service to customers that make telecommunications calls would be required to connect to the public switched telephone network (PSTN) and obtain numbers for assignment to customers. The plan would replace existing per-minute access charges and reciprocal compensation with connection-based intercarrier charges.

12. Western Wireless Proposal. Western Wireless is a wireless carrier that has been designated as an eligible telecommunications carrier (ETC) in 14 states and the Pine Ridge Indian reservation. On December 1, 2004, Western Wireless submitted a reform plan based on a unified bill-and-keep system for all forms of traffic. This plan would reduce per-minute compensation rates to bill-and-keep in equal steps using targeted reductions over a four-year period, with a longer transition period for small rural incumbent LECs.

13. National Association of State Utility Consumer Advocates (NASUCA) Principles. NASUCA advocates a minimalist approach that addresses the disparity among some existing intercarrier compensation rates and reduces certain rate levels over a five-year period. Under the NASUCA plan, the Commission would establish a target rate in each year of a five-year transition down to a rate of $0.0055 per minute. State commissions would be encouraged to match the target rate for intrastate rates, but they would retain authority concerning how to reach that rate. In addition to its proposal, NASUCA urges the Commission to reject efforts to guarantee current revenue streams, such as access revenues.

14. NARUC Principles. In an effort to create a vehicle for evaluating the various reform proposals developed by the industry, a group of NARUC commissioners and staff developed a set of principles addressing the design and functioning of any new intercarrier compensation plan, as well as prerequisites for implementation of any plan. Among other things, NARUC favors the application of a unified regime to all companies that exchange traffic over the Public Switched Telephone Network.

15. CTIA—The Wireless Association (CTIA) Principles. CTIA submitted a statement of principles for the Commission to consider as part of its review of any proposals to reform intercarrier compensation. CTIA supports a bill-and-keep approach to intercarrier compensation reform under which carriers would have the flexibility to design their rate structures to recover a larger portion of costs from end-user customers—while ensuring that end-user rates remain affordable. In terms of universal service reform, CTIA supports the creation of a single, unified universal service support mechanism that calculates support based on the forward-looking economic costs of serving customers.

16. The Commission commends all the industry parties that have been involved in the process of developing these proposals for their substantial efforts to reach agreement on these complicated issues. The Commission also commends the work done by NARUC in developing a set of principles that can be used in evaluating these proposals. Many of the principles identified by NARUC are consistent with the policy goals the Commission has identified above. Given the extensive negotiations that formed the basis for some of these proposals, the Commission asks parties to comment on whether it is preferable for the Commission to adopt a single proposal in its entirety, rather than adopting a modified version of any particular proposal or attempting to combine different components from individual plans. The Commission seeks comment on implementation and transition issues if it were to adopt one proposal or combine different components of the plans.

17. As the Commission considers the record developed in response to the Intercarrier Compensation NPRM and the specific proposals recently filed in this proceeding, it is mindful of its obligation to comply with the statutory provisions governing intercarrier compensation, such as sections 251(b)(5) and 252(d)(2) of the Telecommunications Act of 1996, Public Law No. 104-104, 110 Stat. 96 (1996) (codified at 47 U.S.C. 151 et seq.) (Act). In addition, the Commission recognizes that any unified regime requires reform of intrastate access charges, which are subject to state jurisdiction. In this section, the Commission asks parties to consider these and other legal issues associated with comprehensive reform efforts.

18. Section 252(d)(2) of the Act sets forth an “additional cost” standard for reciprocal compensation under section 251(b)(5). The Commission interpreted the “additional cost” standard of section 252(d)(2) to permit the use of the TELRIC cost standard that was established for interconnection and unbundled elements. In this section, the Commission solicits comment on whether this standard is, or could be, satisfied by the various reform proposals. Additionally, if the Commission decides to retain the current TELRIC methodology for reciprocal compensation, the Commission asks parties to address whether it should define more precisely what costs are traffic-sensitive, and thus recoverable through reciprocal compensation charges, and what costs are non-traffic-sensitive, and not recoverable through reciprocal compensation charges. Also, the Commission invites comment on the proposition that digital switching costs no longer vary with minutes of use due to increased processor capacity. Additionally, the Commission solicits comment on which components of a wireless network should be considered traffic sensitive. Once the Commission identifies the traffic-sensitive costs, it must determine whether those costs should be recovered on a per-minute or flat-rated capacity basis.

19. The statutory pricing standard for reciprocal compensation (“additional cost”) is not the same as the statutory pricing standard for unbundled network elements (UNEs) (cost plus a reasonable profit) set forth in the Act. The Commission's experience suggests that TELRIC is not necessarily consistent with the “additional cost” standard. Specifically, TELRIC measures the average cost of providing a function, which is not necessarily the same as the additional cost of providing that function. The Commission solicits comment on whether a true incremental cost methodology is more appropriate for establishing “additional costs” under section 252(d)(2).

20. The Commission seeks comment on whether it could use its authority under section 10 of the Act to forbear from certain aspects of the compensation requirement of section 251(b)(5) as part of any intercarrier compensation reform effort. The Commission assumes that, if any forbearance were needed to support a bill-and-keep regime, such forbearance would apply only with respect to the compensation requirement of section 251(b)(5) and not to the requirement to enter into reciprocal arrangements for the transport and termination of traffic. The Commission also seeks comment on whether the bar to forbearance contained in section 10(d) precludes exercise of forbearance in this case. Assuming that it can forbear from imposing section 251(b) obligations, the Commission solicits comment on whether it also should forbear from enforcing the compensation requirement contained in section 271(c)(2)(B)(xiii).

21. Because access charges for intrastate traffic historically have been an area within the exclusive jurisdiction of state commissions, any proposal that includes reform of intrastate mechanisms must address the Commission's legal authority to implement such reform. Accordingly, the Commission seeks comment on alternative legal theories under which it could reform intrastate access charges. The Commission also solicits comment on whether it should refer any of the issues related to intrastate access charges to a Federal-State Joint Board, and whether any of the issues addressed in this FNPRM fall within the scope of the mandatory referral requirement of section 410(c) of the Act. Additionally, the Commission seeks comment on the legal analysis presented by the reform proposals concerning the Commission's authority over intrastate access reform, and specifically whether the changes wrought by the 1996 Act give the Commission the power to assert authority over the intrastate charges at issue in this proceeding.

22. In section 254(g) of the Act, Congress codified the Commission's pre-existing geographic rate averaging and rate integration policies. The Commission implemented section 254(g) by adopting two requirements. First, providers of interexchange telecommunications services are required to charge rates in rural and high-cost areas that are no higher than the rates they charge in urban areas. This is known as the geographic rate averaging rule. Second, providers of interexchange telecommunications services are required to charge rates in each state that are no higher than those in any other state. This is known as the rate integration rule.

23. Absent some further reform of the access charge regime, the Commission is concerned that the rate averaging and rate integration requirements eventually will have the effect of discouraging IXCs from serving rural areas. These requirements may place IXCs that serve rural areas at a competitive disadvantage to those that focus on serving urban areas. The Commission asks parties to comment on the relationship between the rate averaging and rate integration requirements and the access charge reform proposals described above. Do any of the proposals ease concerns about the disparate impact of rate averaging and rate integration requirements on nationwide IXCs? If not, are there additional steps the Commission should take to address these concerns?

24. Under section 251(c)(2)(B), an incumbent LEC must allow a requesting telecommunications carrier to interconnect at any technically feasible point. The Commission has interpreted this provision to mean that competitive LECs have the option to interconnect at a single point of interconnection (POI) per local access transport area (LATA). In addition, the Commission's rules preclude a LEC from charging carriers for traffic that originates on the LEC's network. In the Intercarrier Compensation NPRM, the Commission solicited comment on whether an incumbent LEC should be obligated to bear its own costs of delivering traffic to a single POI when that POI is located outside the calling party's local calling area.

25. In response to the Intercarrier Compensation NPRM, most competitive LECs and CMRS providers urge the Commission to maintain the single POI per LATA rule. Other commenters suggest that the interconnecting carrier selecting the POI be responsible for some portion of the transport costs to a POI located outside the local calling area, or that the interconnecting carrier establish additional POIs once certain criteria are met.

26. The comments confirm that issues related to the location of the POI and the allocation of transport costs are some of the most contentious issues in interconnection proceedings. In particular, the record suggests that there are a substantial number of disputes related to how carriers should allocate interconnection costs, particularly when the physical POI is located outside the local calling area where the call originates or when carriers are indirectly interconnected.

27. In this FNPRM, the Commission solicits additional comment on changes to its network interconnection rules to accompany proposed changes to the intercarrier compensation regimes. The Commission asks parties to comment on the network interconnection proposals in the record and on the ICF's proposed default network interconnection rules. The Commission also seeks comment on whether it should consider different network interconnection rules for small incumbent LECs or rural LECs, and whether changing its pricing methodology for reciprocal compensation will have any effect on the incentives of competitive carriers, including CMRS providers, to establish multiple POIs. Finally, the Commission asks parties to address whether any additional rule changes are needed to harmonize the network interconnection rules that apply to section 251(b)(5) traffic with the rules that apply to access traffic.

28. Many of the reform proposals include mechanisms by which some carriers will be permitted to offset revenues previously recovered through interstate access charges. Other proposals question the need to offset revenues and oppose proposals that include revenue guarantees or assumptions concerning revenue neutrality. The Commission solicits comment on whether these mechanisms, or something comparable, must be adopted if it reduces or eliminates the ability of LECs to impose interstate switched access charges on IXCs. The Commission asks parties to comment on whether it should rely solely on end-user charges, or whether it also should rely on universal service support mechanisms (new or existing) to offset revenues no longer recovered through interstate access charges.

29. Additionally, if a cap on federal subscriber charges is needed, the Commission asks parties to comment on the level at which the cap should be set if the jurisdictionally interstate costs of providing switched access no longer are recovered from IXCs through access charges. The Commission also asks parties to discuss what type of findings it must make before using additional universal service funding to offset lost access charge revenues. Commenters should also address the competitive neutrality of any new proposed universal service mechanism with respect to competitive eligible telecommunications carriers, and should comment on alternative approaches that would give LECs the opportunity to recover costs previously recovered from IXCs through interstate access charges. The Commission also asks parties to comment on the impact on consumers of replacing access charges with additional subscriber charges and/or universal service support.

30. As compared to price cap LECs, rate-of-return LECs derive a much greater share of their revenue from access charges. Because many rate-of-return LECs depend so heavily on access charge revenue, some of the proposals submitted in this proceeding include special provisions for these carriers. The Commission seeks comment on the extent to which it should give rate-of-return LECs the opportunity to offset lost access charge revenues with additional universal service funding, additional subscriber charges, or some combination of the two. To the extent it decides that additional universal service support also is necessary, the Commission seeks comment on how much additional support it must provide and how such support should be distributed.

31. If the Commission concludes that additional universal service funding is necessary, one possible approach would be to provide such funding through the interstate common line support (ICLS) mechanism. Under such a methodology, ICLS would be expanded to include not just common line costs, but also switching and transport costs. Alternatively, the Commission could create a new interstate access support mechanism. With respect to any proposed support methodologies, commenters should provide a detailed explanation as to how support should be calculated and the administrative burdens involved. Commenters should also address the competitive neutrality of any new proposed universal service mechanisms with respect to competitive eligible telecommunications carriers.

32. If the Commission acts to reduce or eliminate intrastate switched access charges, it may be necessary to give price cap and rate-of-return LECs the opportunity to offset those revenue losses with alternative cost recovery mechanisms. As with interstate access charges, the two primary mechanisms for doing this are increased subscriber charges and increased universal service funding. The Commission asks parties to comment on how these mechanisms should be structured to give LECs the opportunity to offset lost intrastate access charge revenue. The Commission asks parties to address the same questions concerning cost recovery of interstate access charges as they relate to intrastate access charges. The Commission also seeks comment on whether it should create a federal mechanism to offset any lost intrastate revenues, or whether the states should be responsible for establishing alternative cost recovery mechanisms for LECs within the intrastate jurisdiction.

33. Under the Commission's access charge regime, the rates, terms and conditions under which carriers provide interstate access services are generally contained in tariffs filed with the Commission. In contrast, the exchange of traffic under section 251(b)(5) is governed by interconnection agreements. The Commission seeks comment on how to reconcile these two approaches if it moves to a unified rate for all types of traffic. The Commission asks parties to identify any unique obstacles that may arise for rate-of-return LECs in connection with a regime based solely on agreements and to propose solutions to overcome those obstacles.

34. Given the substantial changes that are possible in this rulemaking, the Commission seeks comment on what type of transition would be needed for a new regime. Parties also should address whether there are any adverse consequences associated with transitioning rate-of-return LECs toward a new unified regime at a slower pace than price cap LECs.

35. Additionally, if the Commission moves to reduce, and possibly eliminate, the imposition of access charges by rate-of-return LECs, is there any reason for states to prohibit them from providing toll services? Parties should discuss the benefits that might accrue to rural customers if all rate-of-return LECs were permitted to provide interexchange services.

36. Transiting occurs when two carriers that are not directly interconnected exchange non-access traffic by routing the traffic through an intermediary carrier's network. Typically, the intermediary carrier is an incumbent LEC and the transited traffic is routed from the originating carrier through the incumbent LEC's tandem switch to the terminating carrier. Although many incumbent LECs, mostly Bell Operating Companies (BOCs), currently provide transit service pursuant to interconnection agreements, the Commission has not had occasion to determine whether carriers have a duty to provide transit service. In the Intercarrier Compensation NPRM, the Commission sought comment on issues that arise under the current intercarrier compensation rules when calls involve a transit service provider, and how a bill-and-keep regime might affect such calls. In this section, the Commission solicits further comment on whether there is a statutory obligation to provide transit services under the Act, and, if so, what rules the Commission should adopt to advance the goals of the Act.

37. The Commission seeks comment on its legal authority to impose transiting obligations. Assuming that it has the necessary legal authority, the Commission solicits comment on whether it should exercise that authority to require the provision of transit service. If rules regarding transit service are warranted, the Commission seeks comment on the scope of such regulation. The Commission also seeks comment on the need for rules governing the terms and conditions for transit service offerings. Further, if the Commission determines that rules governing transit service are warranted, it seeks additional comment on the appropriate pricing methodology, if any, for transit service.

38. Finally, the Commission recognizes that the ability of the originating and terminating carriers to determine the appropriate amount and direction of payments depends, in part, on the billing records generated by the transit service provider. Thus, the Commission asks carriers to comment on whether the current rules and industry standards create billing records sufficiently detailed to permit the originating and terminating carriers to determine the appropriate compensation due.

39. The Commission has previously stated that traffic to or from a CMRS network that originates and terminates within the same Major Trading Area (MTA) is subject to reciprocal compensation obligations under section 251(b)(5), rather than interstate or intrastate access charges. Implementation of the Local Competition Provisions in the Telecommunications Act of 1996 and Interconnection between Local Exchange Carriers and Commercial Mobile Radio Service Providers, CC Docket Nos. 96-98 and 95-185, First Report and Order, 61 FR 45467, August 8, 1996. The Commission reasoned that, because wireless license territories are federally authorized and vary in size, the largest FCC-authorized wireless license territory, i.e., the MTA, would be the most appropriate local service area for CMRS traffic for purposes of reciprocal compensation under section 251(b)(5).

40. Given the goal of moving toward a more unified regime, the Commission seeks comment on whether it should eliminate the intraMTA rule. The Commission further invites commenters to discuss how parties should determine which LEC-CMRS calls are subject to reciprocal compensation in the absence of the intraMTA rule.

41. CMRS providers typically interconnect indirectly with smaller LECs via a BOC tandem. While many CMRS providers express willingness to enter into compensation agreements, they also assert that the cost of engaging in a negotiation and arbitration process with small incumbent LECs is often prohibitive due to the small amount of traffic at issue in each individual negotiation. The Commission seeks comment on what measures it might adopt to reduce the costs associated with establishing compensation arrangements.

42. It is standard industry practice for telecommunications carriers to compare the NPA/NXX codes of the calling and called party to determine the proper rating of a call. It may be possible for an originating LEC to change its switch translations so that a call to an NPA/NXX assigned to a rate center that is local to the originating rate center must be dialed on a 1+ basis and rated as a toll call, rather than a local call. A LEC may have the incentive to engage in this practice for a variety of reasons, including increased access revenue, reduced reciprocal compensation payments, and less significant transport obligations. Alternatively, LECs may engage in such practices pursuant to a state requirement.

43. The Commission seeks comment on whether it should modify any part of the existing rating obligations of carriers. Are there any rating issues unique to CMRS providers or is this a concern for other types of competitive carriers? The Commission recognizes that attempts to address some of the rating issues may raise the question of whether preemption of state commission jurisdiction over the retail rating of intrastate calls and the definition of local calling areas is necessary. Parties supporting preemption should comment on the source of the Commission's authority to preempt and the reasons why preemption of retail rating is warranted in this context.

44. As required by the Regulatory Flexibility Act of 1980, as amended (RFA), an Initial Regulatory Flexibility Analysis (IRFA) was incorporated in the Intercarrier Compensation NPRM. The Commission sought written public comment on reforming the existing intercarrier compensation regime, on alternate approaches to reforming that regime, on whether those alternate approaches will encourage efficient use of and investment in the telecommunications network, on whether they will solve interconnection problems, and on the extent to which they are administratively feasible. The Intercarrier Compensation NPRM also sought comment on the IRFA. The Commission received extensive comment in response to the Intercarrier Compensation NPRM, including several comments addressing the IRFA directly.

45. With this FNPRM, the Commission continues the process of intercarrier compensation reform. The Commission has prepared this present Supplemental Initial Regulatory Flexibility Analysis (Supplemental IRFA) of the possible significant economic impact on a substantial number of small entities by the policies and rules proposed in this FNPRM. This Supplemental IRFA conforms to the RFA. Written public comments are requested on this Supplemental IRFA. Comments must be identified as responses to the Supplemental IRFA and must be filed by the deadlines for comments established in the FNPRM. To the extent that any statement in this Supplemental IRFA is perceived as creating ambiguity with respect to Commission rules or statements made in sections of this FNPRM that precede this Supplemental IRFA, the rules and statements set forth in those preceding sections are controlling. The Commission will send a copy of this entire FNPRM, including this Supplemental IRFA, to the Chief Counsel for Advocacy of the Small Business Administration (SBA). In addition, the FNPRM and the Supplemental IRFA (or summaries thereof) will be published in the Federal Register.

46. The Commission's goal in this proceeding is to reform the current intercarrier compensation regimes and create a more uniform regime that promotes efficient facilities-based competition in the marketplace. As discussed above, the Commission believes that this goal will be served by creating a technologically and competitively neutral intercarrier compensation regime that is consistent with network developments. It is also critical that this regime be implemented in a manner that will provide regulatory certainty, limit the need for regulatory intervention, and preserve universal service.

47. The current intercarrier compensation system is governed by a complex set of federal and state rules. This system applies different cost methodologies to similar services based on traditional regulatory distinctions that may have no bearing on the cost of providing service, are not tied to economic or technical differences between services, and are increasingly difficult to maintain. These regulatory distinctions provide an opportunity for regulatory arbitrage activities, and distort the telecommunications markets at the expense of healthy competition.

48. The current intercarrier compensation system also does not take into account recent developments in service offerings, including bundled local and long distance services, and voice over Internet Protocol (VoIP) services. These developments blur traditional industry and regulatory distinctions among various types of services and service providers, making it increasingly difficult to enforce the existing regulatory regimes. Additionally, the current intercarrier compensation system does not account for recent developments in telecommunications infrastructure. The existing intercarrier compensation regimes are based largely on the recovery of switching costs through per-minute charges. As a result of developments in telecommunications infrastructure, it appears that most network costs, including switching costs, result from connections to the network rather than usage of the network itself. Finally, developments in consumer control over telecommunications services bring into question the assumption that calling parties receive 100 percent of the benefits from a telephone call, a fundamental premise of the current intercarrier compensation regimes.

49. The Commission received several intercarrier compensation reform proposals in response to the NPRM. In this FNPRM, the Commission seeks comment on numerous legal issues it must consider as part of intercarrier compensation reform, whether it adopts one of these proposals or develops a separate approach. Specifically, the Commission seeks comment on whether the cost standards proposed satisfy the requirements of the Act, on the possible exercise of its forbearance authority, and on the appropriate role of state regulation in the intercarrier compensation reform process. The Commission also seeks comment on proposed changes to current interconnection rules.

50. Further, the Commission seeks comment on its obligation to provide cost-recovery mechanisms, the need, if any, for new cost-recovery mechanisms, the appropriate level of different types of cost recovery mechanisms including end-user charges and universal service, and on the impact of replacing access charges with other types of cost recovery mechanisms. The Commission also seeks comment on whether price cap and rate-of-return LECs must be treated equally with regard to cost recovery mechanisms, whether such treatment would be competitively neutral, and the appropriate role for state cost recovery mechanisms. Additionally, the Commission seeks comment on how best to transition from the current regime to unified intercarrier compensation regime. Finally, the Commission seeks comment on additional issues stemming from intercarrier compensation reform including transit service obligations, the appropriate treatment of intraMTA CMRS traffic, interconnection agreement negotiation obligations, and routing and rating of CMRS calls.

51. The legal basis for any action that may be taken pursuant to this FNPRM is contained in sections 1-5, 7, 10, 201-05, 207-09, 214, 218-20, 225-27, 251-54, 256, 271, 303, 332, 403, 405, 502 and 503 of the Communications Act of 1934, as amended, 47 U.S.C. 151-55, 157, 160, 201-05, 207-09, 214, 218-20, 225-27, 251-54, 256, 271, 303, 332, 403, 405, 502, and 503 and sections 1.1, 1.421 of the Commission's rules, 47 CFR 1.1, 1.421.

52. The RFA directs agencies to provide a description of, and, where feasible, an estimate of the number of small entities that may be affected by rules adopted herein. The RFA generally defines the term “small entity” as having the same meaning as the terms “small business,” “small organization,” and “small governmental jurisdiction.” In addition, the term “small business” has the same meaning as the term “small business concern” under the Small Business Act. A “small business concern” is one that: (1) Is independently owned and operated; (2) is not dominant in its field of operation; and (3) satisfies any additional criteria established by the Small Business Administration (SBA). 5 U.S.C. 632.

53. In this section, the Commission further describes and estimates the number of small entity licensees and regulatees that may also be indirectly affected by rules adopted pursuant to this FNPRM. The most reliable source of information regarding the total numbers of certain common carrier and related providers nationwide, as well as the number of commercial wireless entities, appears to be the data that the Commission publishes in its Trends in Telephone Service report. The SBA has developed small business size standards for wireline and wireless small businesses within the three commercial census categories of Wired Telecommunications Carriers, Paging, and Cellular and Other Wireless Telecommunications. Under these categories, a business is small if it has 1,500 or fewer employees. Below, using the above size standards and others, the Commission discusses the total estimated numbers of small businesses that might be affected by its actions.

54. Wired Telecommunications Carriers. The SBA has developed a small business size standard for Wired Telecommunications Carriers, which consists of all such companies having 1,500 or fewer employees. According to Census Bureau data for 1997, there were 2,225 firms in this category, total, that operated for the entire year. Of this total, 2,201 firms had employment of 999 or fewer employees, and an additional 24 firms had employment of 1,000 employees or more. Thus, under this size standard, the majority of firms can be considered small.

55. Local Exchange Carriers. Neither the Commission nor the SBA has developed a size standard for small businesses specifically applicable to local exchange services. The closest applicable size standard under SBA rules is for Wired Telecommunications Carriers. Under that size standard, such a business is small if it has 1,500 or fewer employees. According to Commission data, 1,310 carriers reported that they were incumbent local exchange service providers. Of these 1,310 carriers, an estimated 1,025 have 1,500 or fewer employees and 285 have more than 1,500 employees. In addition, according to Commission data, 563 companies reported that they were engaged in the provision of either competitive access provider services or competitive local exchange carrier services. Of these 563 companies, an estimated 472 have 1,500 or fewer employees and 91 have more than 1,500 employees. In addition, 37 carriers reported that they were “Other Local Exchange Carriers.” Of the 37 “Other Local Exchange Carriers,” an estimated 36 have 1,500 or fewer employees and one has more than 1,500 employees. Consequently, the Commission estimates that most providers of local exchange service, competitive local exchange service, competitive access providers, and “Other Local Exchange Carriers” are small entities that may be affected by the rules and policies adopted herein.

56. Interexchange Carriers. Neither the Commission nor the SBA has developed a size standard for small businesses specifically applicable to interexchange services. The closest applicable size standard under SBA rules is for Wired Telecommunications Carriers. Under that size standard, such a business is small if it has 1,500 or fewer employees. According to Commission data, 281 companies reported that they were interexchange carriers. Of these 281 companies, an estimated 254 have 1,500 or fewer employees and 27 have more than 1,500 employees. Consequently, the Commission estimates that the majority of interexchange service providers are small entities that may be affected by the rules and policies adopted herein.

57. Wired Telecommunications Carriers. The SBA has developed a small business size standard for Wired Telecommunications Carriers, which consists of all such companies having 1,500 or fewer employees. According to Census Bureau data for 1997, there were 2,225 firms in this category, total, that operated for the entire year. Of this total, 2,201 firms had employment of 999 or fewer employees, and an additional 24 firms had employment of 1,000 employees or more. Thus, under this size standard, the majority of firms can be considered small.

58. Incumbent Local Exchange Carriers (LECs). Neither the Commission nor the SBA has developed a size standard for small businesses specifically applicable to incumbent local exchange services. The closest applicable size standard under SBA rules is for Wired Telecommunications Carriers. Under that size standard, such a business is small if it has 1,500 or fewer employees. According to Commission data, 1,337 carriers reported that they were engaged in the provision of local exchange services. Of these 1,337 carriers, an estimated 1,032 have 1,500 or fewer employees and 305 have more than 1,500 employees. Consequently, the Commission estimates that most providers of incumbent local exchange service are small businesses that may be affected by the rules and policies adopted herein.

59. Competitive Local Exchange Carriers (CLECs), Competitive Access Providers (CAPs), and “Other Local Exchange Carriers.” Neither the Commission nor the SBA has developed a size standard for small businesses specifically applicable to providers of competitive exchange services or to competitive access providers or to “Other Local Exchange Carriers,” all of which are discrete categories under which TRS data are collected. The closest applicable size standard under SBA rules is for Wired Telecommunications Carriers. Under that size standard, such a business is small if it has 1,500 or fewer employees. According to Commission data, 609 companies reported that they were engaged in the provision of either competitive access provider services or competitive local exchange carrier services. Of these 609 companies, an estimated 458 have 1,500 or fewer employees and 151 have more than 1,500 employees. In addition, 35 carriers reported that they were “Other Local Service Providers.” Of the 35 “Other Local Service Providers,” an estimated 34 have 1,500 or fewer employees and one has more than 1,500 employees. Consequently, the Commission estimates that most providers of competitive local exchange service, competitive access providers, and “Other Local Exchange Carriers” are small entities that may be affected by the rules and policies adopted herein.

60. Interexchange Carriers (IXCs). Neither the Commission nor the SBA has developed a size standard for small businesses specifically applicable to interexchange services. The closest applicable size standard under SBA rules is for Wired Telecommunications Carriers. Under that size standard, such a business is small if it has 1,500 or fewer employees. According to Commission data, 261 companies reported that their primary telecommunications service activity was the provision of interexchange services. Of these 261 companies, an estimated 223 have 1,500 or fewer employees and 38 have more than 1,500 employees. Consequently, the Commission estimates that the majority of interexchange service providers are small entities that may be affected by the rules and policies adopted herein.

61. Operator Service Providers (OSPs). Neither the Commission nor the SBA has developed a size standard for small businesses specifically applicable to operator service providers. The closest applicable size standard under SBA rules is for Wired Telecommunications Carriers. Under that size standard, such a business is small if it has 1,500 or fewer employees. According to Commission data, 23 companies reported that they were engaged in the provision of operator services. Of these 23 companies, an estimated 22 have 1,500 or fewer employees and one has more than 1,500 employees. Consequently, the Commission estimates that the majority of operator service providers are small entities that may be affected by the rules and policies adopted herein.

62. Payphone Service Providers (PSPs). Neither the Commission nor the SBA has developed a size standard for small businesses specifically applicable to payphone service providers. The closest applicable size standard under SBA rules is for Wired Telecommunications Carriers. Under that size standard, such a business is small if it has 1,500 or fewer employees. According to Commission data, 761 companies reported that they were engaged in the provision of payphone services. Of these 761 companies, an estimated 757 have 1,500 or fewer employees and four have more than 1,500 employees. Consequently, the Commission estimates that the majority of payphone service providers are small entities that may be affected by the rules and policies adopted herein.

63. Prepaid Calling Card Providers. The SBA has developed a size standard for a small business within the category of Telecommunications Resellers. Under that SBA size standard, such a business is small if it has 1,500 or fewer employees. According to Commission data, 37 companies reported that they were engaged in the provision of prepaid calling cards. Of these 37 companies, an estimated 36 have 1,500 or fewer employees and one has more than 1,500 employees. Consequently, the Commission estimates that the majority of prepaid calling card providers are small entities that may be affected by the rules and policies adopted herein.

64. Local Resellers. The SBA has developed a small business size standard for the category of Telecommunications Resellers. Under that size standard, such a business is small if it has 1,500 or fewer employees. According to Commission data, 133 carriers have reported that they are engaged in the provision of local resale services. Of these, an estimated 127 have 1,500 or fewer employees and six have more than 1,500 employees. Consequently, the Commission estimates that the majority of local resellers are small entities that may be affected by its action.

65. Toll Resellers. The SBA has developed a small business size standard for the category of Telecommunications Resellers. Under that size standard, such a business is small if it has 1,500 or fewer employees. According to Commission data, 625 carriers have reported that they are engaged in the provision of toll resale services. Of these, an estimated 590 have 1,500 or fewer employees and 35 have more than 1,500 employees. Consequently, the Commission estimates that the majority of toll resellers are small entities that may be affected by its action.

66. Other Toll Carriers. Neither the Commission nor the SBA has developed a size standard for small businesses specifically applicable to “Other Toll Carriers.” This category includes toll carriers that do not fall within the categories of interexchange carriers, operator service providers, prepaid calling card providers, satellite service carriers, or toll resellers. The closest applicable size standard under SBA rules is for Wired Telecommunications Carriers. Under that size standard, such a business is small if it has 1,500 or fewer employees. According to Commission's data, 92 companies reported that their primary telecommunications service activity was the provision of other toll carriage. Of these 92 companies, an estimated 82 have 1,500 or fewer employees and ten have more than 1,500 employees. Consequently, the Commission estimates that most “Other Toll Carriers” are small entities that may be affected by the rules and policies adopted herein.

67. Paging. The SBA has developed a small business size standard for Paging, which consists of all such firms having 1,500 or fewer employees. According to Census Bureau data for 1997, in this category there was a total of 1,320 firms that operated for the entire year. Of this total, 1,303 firms had employment of 999 or fewer employees, and an additional seventeen firms had employment of 1,000 employees or more. Thus, under this size standard, the majority of firms can be considered small.

68. Cellular and Other Wireless Telecommunications. The SBA has developed a small business size standard for Cellular and Other Wireless Telecommunication, which consists of all such firms having 1,500 or fewer employees. According to Census Bureau data for 1997, in this category there was a total of 977 firms that operated for the entire year. Of this total, 965 firms had employment of 999 or fewer employees, and an additional twelve firms had employment of 1,000 employees or more. Thus, under this size standard, the majority of firms can be considered small.

69. Broadband Personal Communications Service. The broadband Personal Communications Service (PCS) spectrum is divided into six frequency blocks designated A through F, and the Commission has held auctions for each block. The Commission defined “small entity” for Blocks C and F as an entity that has average gross revenues of $40 million or less in the three previous calendar years. For Block F, an additional classification for “very small business” was added and is defined as an entity that, together with its affiliates, has average gross revenues of not more than $15 million for the preceding three calendar years.” These standards defining “small entity” in the context of broadband PCS auctions have been approved by the SBA. No small businesses, within the SBA-approved small business size standards bid successfully for licenses in Blocks A and B. There were 90 winning bidders that qualified as small entities in the Block C auctions. A total of 93 small and very small business bidders won approximately 40 percent of the 1,479 licenses for Blocks D, E, and F. On March 23, 1999, the Commission re-auctioned 347 C, D, E, and F Block licenses. There were 48 small business winning bidders. On January 26, 2001, the Commission completed the auction of 422 C and F Broadband PCS licenses in Auction No. 35. Of the 35 winning bidders in this auction, 29 qualified as “small” or “very small” businesses. Based on this information, the Commission concludes that the number of small broadband PCS licenses will include the 90 winning C Block bidders, the 93 qualifying bidders in the D, E, and F Block auctions, the 48 winning bidders in the 1999 re-auction, and the 29 winning bidders in the 2001 re-auction, for a total of 260 small entity broadband PCS providers, as defined by the SBA small business size standards and the Commission's auction rules. The Commission notes that, as a general matter, the number of winning bidders that qualify as small businesses at the close of an auction does not necessarily represent the number of small businesses currently in service. Also, the Commission does not generally track subsequent business size unless, in the context of assignments or transfers, unjust enrichment issues are implicated.

70. Narrowband Personal Communications Services. The Commission has adopted a two-tiered small business size standard in the Narrowband PCS Second Report and Order, 65 FR 35875, June 6, 2000. A “small business” is an entity that, together with affiliates and controlling interests, has average gross revenues for the three preceding years of not more than $40 million. A “very small business” is an entity that, together with affiliates and controlling interests, has average gross revenues for the three preceding years of not more than $15 million. The SBA has approved these small business size standards. In the future, the Commission will auction 459 licenses to serve Metropolitan Trading Areas (MTAs) and 408 response channel licenses. There is also one megahertz of narrowband PCS spectrum that has been held in reserve and that the Commission has not yet decided to release for licensing. The Commission cannot predict accurately the number of licenses that will be awarded to small entities in future actions. However, four of the 16 winning bidders in the two previous narrowband PCS auctions were small businesses, as that term was defined under the Commission's rules. The Commission assumes, for purposes of this analysis, that a large portion of the remaining narrowband PCS licenses will be awarded to small entities. The Commission also assumes that at least some small businesses will acquire narrowband PCS licenses by means of the Commission's partitioning and disaggregation rules.

71. 220 MHz Radio Service—Phase I Licensees. The 220 MHz service has both Phase I and Phase II licenses. Phase I licensing was conducted by lotteries in 1992 and 1993. There are approximately 1,515 such non-nationwide licensees and four nationwide licensees currently authorized to operate in the 220 MHz band. The Commission has not developed a small business size standard for small entities specifically applicable to such incumbent 220 MHz Phase I licensees. To estimate the number of such licensees that are small businesses, the Commission applies the small business size standard under the SBA rules applicable to “Cellular and Other Wireless Telecommunications” companies. This standard provides that such a company is small if it employs no more than 1,500 persons. According to Census Bureau data for 1997, there were 977 firms in this category, total, that operated for the entire year. Of this total, 965 firms had employment of 999 or fewer employees, and an additional 12 firms had employment of 1,000 employees or more. If this general ratio continues in the context of Phase I 220 MHz licensees, the Commission estimates that nearly all such licensees are small businesses under the SBA's small business size standard.

72. 220 MHz Radio Service—Phase II Licensees. The 220 MHz service has both Phase I and Phase II licenses. The Phase II 220 MHz service is a new service, and is subject to spectrum auctions. In the 220 MHz Third Report and Order, 62 FR 15978, April 3, 1997, the Commission adopted a small business size standard for “small” and “very small” businesses for purposes of determining their eligibility for special provisions such as bidding credits and installment payments. This small business size standard indicates that a “small business” is an entity that, together with its affiliates and controlling principals, has average gross revenues not exceeding $15 million for the preceding three years. A “very small business” is an entity that, together with its affiliates and controlling principals, has average gross revenues that do not exceed $3 million for the preceding three years. The SBA has approved these small business size standards. Auctions of Phase II licenses commenced on September 15, 1998, and closed on October 22, 1998. In the first auction, 908 licenses were auctioned in three different-sized geographic areas: three nationwide licenses, 30 Regional Economic Area Group (EAG) Licenses, and 875 Economic Area (EA) Licenses. Of the 908 licenses auctioned, 693 were sold. Thirty-nine small businesses won licenses in the first 220 MHz auction. The second auction included 225 licenses: 216 EA licenses and 9 EAG licenses. Fourteen companies claiming small business status won 158 licenses.

73. 800 MHz and 900 MHz Specialized Mobile Radio Licenses. The Commission awards “small entity” and “very small entity” bidding credits in auctions for Specialized Mobile Radio (SMR) geographic area licenses in the 900 MHz bands to firms that had revenues of no more than $15 million in each of the three previous calendar years, or that had revenues of no more than $3 million in each of the previous calendar years. The SBA has approved these size standards. The Commission awards “small entity” and “very small entity” bidding credits in auctions for Specialized Mobile Radio (SMR) geographic area licenses in the 800 MHz bands to firms that had revenues of no more than $40 million in each of the three previous calendar years, or that had revenues of no more than $15 million in each of the previous calendar years. These bidding credits apply to SMR providers in the 800 MHz and 900 MHz bands that either hold geographic area licenses or have obtained extended implementation authorizations. The Commission does not know how many firms provide 800 MHz or 900 MHz geographic area SMR service pursuant to extended implementation authorizations, nor how many of these providers have annual revenues of no more than $15 million. One firm has over $15 million in revenues. The Commission assumes, for purposes here, that all of the remaining existing extended implementation authorizations are held by small entities, as that term is defined by the SBA. The Commission has held auctions for geographic area licenses in the 800 MHz and 900 MHz SMR bands. There were 60 winning bidders that qualified as small or very small entities in the 900 MHz SMR auctions. Of the 1,020 licenses won in the 900 MHz auction, bidders qualifying as small or very small entities won 263 licenses. In the 800 MHz auction, 38 of the 524 licenses won were won by small and very small entities. The Commission notes that, as a general matter, the number of winning bidders that qualify as small businesses at the close of an auction does not necessarily represent the number of small businesses currently in service. Also, the Commission does not generally track subsequent business size unless, in the context of assignments or transfers, unjust enrichment issues are implicated.

74. Private and Common Carrier Paging. In the Paging Third Report and Order, 62 FR 16004, April 3, 1997, the Commission developed a small business size standard for “small businesses” and “very small businesses” for purposes of determining their eligibility for special provisions such as bidding credits and installment payments. A “small business” is an entity that, together with its affiliates and controlling principals, has average gross revenues not exceeding $15 million for the preceding three years. Additionally, a “very small business” is an entity that, together with its affiliates and controlling principals, has average gross revenues that are not more than $3 million for the preceding three years. The SBA has approved these size standards. An auction of Metropolitan Economic Area licenses commenced on February 24, 2000, and closed on March 2, 2000. Of the 985 licenses auctioned, 440 were sold. Fifty-seven companies claiming small business status won. At present, there are approximately 24,000 Private-Paging site-specific licenses and 74,000 Common Carrier Paging licenses. According to the most recent Trends in Telephone Service, 471 carriers reported that they were engaged in the provision of either paging and messaging services or other mobile services. Of those, the Commission estimates that 450 are small, under the SBA business size standard specifying that firms are small if they have 1,500 or fewer employees.

75. 700 MHz Guard Band Licensees. In the 700 MHz Guard Band Order, 65 FR 3139, January 20, 2000, the Commission adopted a small business size standard for “small businesses” and “very small businesses” for purposes of determining their eligibility for special provisions such as bidding credits and installment payments. A “small business” as an entity that, together with its affiliates and controlling principals, has average gross revenues not exceeding $15 million for the preceding three years. Additionally, a “very small business” is an entity that, together with its affiliates and controlling principals, has average gross revenues that are not more than $3 million for the preceding three years. An auction of 52 Major Economic Area (MEA) licenses commenced on September 6, 2000, and closed on September 21, 2000. Of the 104 licenses auctioned, 96 licenses were sold to nine bidders. Five of these bidders were small businesses that won a total of 26 licenses. A second auction of 700 MHz Guard Band licenses commenced on February 13, 2001 and closed on February 21, 2001. All eight of the licenses auctioned were sold to three bidders. One of these bidders was a small business that won a total of two licenses.

76. Rural Radiotelephone Service. The Commission has not adopted a size standard for small businesses specific to the Rural Radiotelephone Service. A significant subset of the Rural Radiotelephone Service is the Basic Exchange Telephone Radio System (BETRS). The Commission uses the SBA's small business size standard applicable to “Cellular and Other Wireless Telecommunications,” i.e., an entity employing no more than 1,500 persons. There are approximately 1,000 licensees in the Rural Radiotelephone Service, and the Commission estimates that there are 1,000 or fewer small entity licensees in the Rural Radiotelephone Service that may be affected by the rules and policies adopted herein.

77. Air-Ground Radiotelephone Service. The Commission has not adopted a small business size standard specific to the Air-Ground Radiotelephone Service. The Commission will use SBA's small business size standard applicable to “Cellular and Other Wireless Telecommunications,” i.e., an entity employing no more than 1,500 persons. There are approximately 100 licensees in the Air-Ground Radiotelephone Service, and the Commission estimates that almost all of them qualify as small under the SBA small business size standard.

78. Aviation and Marine Radio Services. Small businesses in the aviation and marine radio services use a very high frequency (VHF) marine or aircraft radio and, as appropriate, an emergency position-indicating radio beacon (and/or radar) or an emergency locator transmitter. The Commission has not developed a small business size standard specifically applicable to these small businesses. For purposes of this analysis, the Commission uses the SBA small business size standard for the category “Cellular and Other Telecommunications,” which is 1,500 or fewer employees. Most applicants for recreational licenses are individuals. Approximately 581,000 ship station licensees and 131,000 aircraft station licensees operate domestically and are not subject to the radio carriage requirements of any statute or treaty. For purposes of evaluations in this analysis, the Commission estimates that there are up to approximately 712,000 licensees that are small businesses (or individuals) under the SBA standard. In addition, between December 3, 1998 and December 14, 1998, the Commission held an auction of 42 VHF Public Coast licenses in the 157.1875-157.4500 MHz (ship transmit) and 161.775-162.0125 MHz (coast transmit) bands. For purposes of the auction, the Commission defined a “small” business as an entity that, together with controlling interests and affiliates, has average gross revenues for the preceding three years not to exceed $15 million dollars. In addition, a “very small” business is one that, together with controlling interests and affiliates, has average gross revenues for the preceding three years not to exceed $3 million dollars. There are approximately 10,672 licensees in the Marine Coast Service, and the Commission estimates that almost all of them qualify as “small” businesses under the above special small business size standards.

79. Fixed Microwave Services. Fixed microwave services include common carrier, private operational-fixed, and broadcast auxiliary radio services. At present, there are approximately 22,015 common carrier fixed licensees and 61,670 private operational-fixed licensees and broadcast auxiliary radio licensees in the microwave services. The Commission has not created a size standard for a small business specifically with respect to fixed microwave services. For purposes of this analysis, the Commission uses the SBA small business size standard for the category “Cellular and Other Telecommunications,” which is 1,500 or fewer employees. The Commission does not have data specifying the number of these licensees that have more than 1,500 employees, and thus is unable at this time to estimate with greater precision the number of fixed microwave service licensees that would qualify as small business concerns under the SBA's small business size standard. Consequently, the Commission estimates that there are up to 22,015 common carrier fixed licensees and up to 61,670 private operational-fixed licensees and broadcast auxiliary radio licensees in the microwave services that may be small and may be affected by the rules and policies adopted herein. The Commission noted, however, that the common carrier microwave fixed licensee category includes some large entities.

80. Offshore Radiotelephone Service. This service operates on several UHF television broadcast channels that are not used for television broadcasting in the coastal areas of states bordering the Gulf of Mexico. There are presently approximately 55 licensees in this service. The Commission is unable to estimate at this time the number of licensees that would qualify as small under the SBA's small business size standard for “Cellular and Other Wireless Telecommunications” services. Under that SBA small business size standard, a business is small if it has 1,500 or fewer employees.

81. Wireless Communications Services. This service can be used for fixed, mobile, radiolocation, and digital audio broadcasting satellite uses. The Commission established small business size standards for the wireless communications services (WCS) auction. A “small business” is an entity with average gross revenues of $40 million for each of the three preceding years, and a “very small business” is an entity with average gross revenues of $15 million for each of the three preceding years. The SBA has approved these small business size standards. The Commission auctioned geographic area licenses in the WCS service. In the auction, there were seven winning bidders that qualified as “very small business” entities, and one that qualified as a “small business” entity. The Commission concludes that the number of geographic area WCS licensees affected by this analysis includes these eight entities.

82. 39 GHz Service. The Commission created a special small business size standard for 39 GHz licenses—an entity that has average gross revenues of $40 million or less in the three previous calendar years. An additional size standard for “very small business” is: an entity that, together with affiliates, has average gross revenues of not more than $15 million for the preceding three calendar years. The SBA has approved these small business size standards. The auction of the 2,173 39 GHz licenses began on April 12, 2000 and closed on May 8, 2000. The 18 bidders who claimed small business status won 849 licenses. Consequently, the Commission estimates that 18 or fewer 39 GHz licensees are small entities that may be affected by the rules and policies adopted herein.

83. Local Multipoint Distribution Service. Local Multipoint Distribution Service (LMDS) is a fixed broadband point-to-multipoint microwave service that provides for two-way video telecommunications. The auction of the 1,030 Local Multipoint Distribution Service (LMDS) licenses began on February 18, 1998 and closed on March 25, 1998. The Commission established a small business size standard for LMDS licenses as an entity that has average gross revenues of less than $40 million in the three previous calendar years. An additional small business size standard for “very small business” was added as an entity that, together with its affiliates, has average gross revenues of not more than $15 million for the preceding three calendar years. The SBA has approved these small business size standards in the context of LMDS auctions. There were 93 winning bidders that qualified as small entities in the LMDS auctions. A total of 93 small and very small business bidders won approximately 277 A Block licenses and 387 B Block licenses. On March 27, 1999, the Commission re-auctioned 161 licenses; there were 40 winning bidders. Based on this information, the Commission concluded that the number of small LMDS licenses consists of the 93 winning bidders in the first auction and the 40 winning bidders in the re-auction, for a total of 133 small entity LMDS providers.

84. 218-219 MHz Service. The first auction of 218-219 MHz spectrum resulted in 170 entities winning licenses for 594 Metropolitan Statistical Area licenses. Of the 594 licenses, 557 were won by entities qualifying as a small business. For that auction, the small business size standard was an entity that, together with its affiliates, has no more than a $6 million net worth and, after federal income taxes (excluding any carry over losses), has no more than $2 million in annual profits each year for the previous two years. In the 218-219 MHz Report and Order and Memorandum Opinion and Order, 64 FR 59656, November 3, 1999, the Commission established a small business size standard for a “small business” as an entity that, together with its affiliates and persons or entities that hold interests in such an entity and their affiliates, has average annual gross revenues not to exceed $15 million for the preceding three years. A “very small business” is defined as an entity that, together with its affiliates and persons or entities that hold interests in such an entity and its affiliates, has average annual gross revenues not to exceed $3 million for the preceding three years. The SBA has approved these size standards. The Commission cannot estimate, however, the number of licenses that will be won by entities qualifying as small or very small businesses under its rules in future auctions of 218-219 MHz spectrum.

85. 24 GHz—Incumbent Licensees. This analysis may affect incumbent licensees who were relocated to the 24 GHz band from the 18 GHz band, and applicants who wish to provide services in the 24 GHz band. The applicable SBA small business size standard is that of “Cellular and Other Wireless Telecommunications” companies. This category provides that such a company is small if it employs no more than 1,500 persons. According to Census Bureau data for 1997, there were 977 firms in this category that operated for the entire year. Of this total, 965 firms had employment of 999 or fewer employees, and an additional 12 firms had employment of 1,000 employees or more. Thus, under this size standard, the great majority of firms can be considered small. These broader census data notwithstanding, the Commission believes that there are only two licensees in the 24 GHz band that were relocated from the 18 GHz band, Teligent and TRW, Inc. It is the Commission's understanding that Teligent and its related companies have less than 1,500 employees, though this may change in the future. TRW is not a small entity. Thus, only one incumbent licensee in the 24 GHz band is a small business entity.

86. 24 GHz—Future Licensees. With respect to new applicants in the 24 GHz band, the small business size standard for “small business” is an entity that, together with controlling interests and affiliates, has average annual gross revenues for the three preceding years not in excess of $15 million. “Very small business” in the 24 GHz band is an entity that, together with controlling interests and affiliates, has average gross revenues not exceeding $3 million for the preceding three years. The SBA has approved these small business size standards. These size standards will apply to the future auction, if held.

87. Satellite Service Carriers. The SBA has developed a size standard for small businesses within the category of Satellite Telecommunications. Under that SBA size standard, such a business is small if it has 1,500 or fewer employees. According to Commission data, 31 carriers reported that they were engaged in the provision of satellite services. Of these 31 carriers, an estimated 25 have 1,500 or fewer employees and six, alone or in combination with affiliates, have more than 1,500 employees. Consequently, the Commission estimates that there are 31 or fewer satellite service carriers which are small businesses that may be affected by the rules and policies proposed herein.

88. Cable and Other Program Distribution. This category includes cable systems operators, closed circuit television services, direct broadcast satellite services, multipoint distribution systems, satellite master antenna systems, and subscription television services. The SBA has developed small business size standard for this census category, which includes all such companies generating $12.5 million or less in revenue annually. According to Census Bureau data for 1997, there were a total of 1,311 firms in this category, total, that had operated for the entire year. Of this total, 1,180 firms had annual receipts of under $10 million and an additional 52 firms had receipts of $10 million or more but less than $25 million. Consequently, the Commission estimates that the majority of providers in this service category are small businesses that may be affected by the rules and policies adopted herein.

89. Internet Service Providers. The SBA has developed a small business size standard for Internet Service Providers (ISPs). ISPs “provide clients access to the Internet and generally provide related services such as web hosting, web page designing, and hardware or software consulting related to Internet connectivity.” Under the SBA size standard, such a business is small if it has average annual receipts of $21 million or less. According to Census Bureau data for 1997, there were 2,751 firms in this category that operated for the entire year. Of these, 2,659 firms had annual receipts of under $10 million, and an additional 67 firms had receipts of between $10 million and $24,999,999. Consequently, the Commission estimates that the majority of these firms are small entities that may be affected by its action.

90. All Other Information Services. This industry comprises establishments primarily engaged in providing other information services (except new syndicates and libraries and archives). The Commission notes that, in this FNPRM, it has described activities such as e-mail, online gaming, web browsing, video conferencing, instant messaging, and other, similar IP-enabled services. The SBA has developed a small business size standard for this category; that size standard is $6 million or less in average annual receipts. According to Census Bureau data for 1997, there were 195 firms in this category that operated for the entire year. Of these, 172 had annual receipts of under $5 million, and an additional nine firms had receipts of between $5 million and $9,999,999. Consequently, the Commission estimates that the majority of these firms are small entities that may be affected by its action.

91. This supplemental IRFA seeks comment on several rule changes and intercarrier compensation reform proposals under consideration that may affect reporting, recordkeeping and other compliance requirements for small entities. The types of rule changes under consideration are described below.

92. Any intercarrier compensation reform measures that achieve the Commission's goal of moving toward a more unified regime will relieve small entities of some administrative, recordkeeping, and other compliance requirements, but may also create new burdens. As discussed within this FNPRM, the Commission is considering, and seeks comment on, several options for moving to a unified intercarrier compensation regime. Each of these options relieves certain compliance burdens that exist under the current system, but no option under consideration would be burden-free. Consequently, in this Supplemental IRFA the Commission seeks comment on burdens to small entities associated with each reform proposal under consideration.

93. Small entities face significant recordkeeping and compliance burdens under the current intercarrier compensation system, including determining the appropriate regulatory category for all traffic they send or receive, measuring the quantity of each type of traffic, and maintaining administrative systems and processes for intercarrier payments. Additionally, small entities must devote considerable resources to resolving disputes arising due to ambiguities in the rules defining the current intercarrier compensation regimes. A unified intercarrier compensation system with clear rules would reduce the need for small entities to devote resources to these tasks.

94. Some of the intercarrier compensation reform proposals received in this proceeding are based on a bill-and-keep approach. Under a bill-and-keep approach, carriers would look to their own customers, rather than to other carriers, to recover costs. Carriers, including small entities, might have to modify their systems and processes to reflect this change in cost recovery. These modifications may present a compliance burden to small entities. Any compliance burden, however, may be outweighed by the reduction in burdens associated with the elimination of intercarrier charges. Additionally, carriers, including small entities, already have systems and processes designed to bill customers with which they have a retail relationship. While these systems and processes may have to be modified, these modifications should be similar to those that occur in the normal course of business already.

95. If a bill-and-keep approach were adopted, the current network interconnection rules may have to be revised or replaced. Carriers would have to ensure that their agreements or arrangements with other carriers comply with any new network interconnection rules. Complying with any new or modified interconnection rules may impose a compliance burden on all carriers, including small entities. This burden may be offset by streamlined operation under new interconnection rules that resolve or eliminate the potential for the types of interconnection disputes that arise under the current rules.

96. The bill-and-keep plans under consideration include new universal service mechanisms. Under these plans, carriers will have to determine their costs and demonstrate a shortfall between their costs and revenues in order to qualify for funding from cost recovery mechanisms. Further, some types of carriers, including small entities, may not be eligible for some of the cost recovery mechanisms included in some of the plans. Determining costs, determining eligibility under any new universal service plan, and administration related to any new universal service plan may represent significant burdens to small entities under a bill-and-keep plan.

97. The Commission is considering several unified CPNP plans submitted by industry groups comprised of small and medium sized rural LECs and CLECs. Although these proposals are designed to reduce the overall compliance burdens associated with each compensation regime by applying the same rate to all types of traffic, they may cause certain specific compliance burdens to increase.

98. Under any CPNP approach, carriers would continue to look to other carriers to recover a portion of their costs, and would have to maintain systems and processes to bill other carriers for these new charges. The cost standard that would be used to determine the rates varies with each plan. Under plans that apply a TELRIC or embedded cost methodology, carriers may need to perform cost studies using a methodology they have not previously used. Such cost calculations potentially represent a significant compliance and recordkeeping burden for small entities. Moreover, some of the unified CPNP plans under consideration in this proceeding propose rates that would vary by carrier and/or by state. If such plans were adopted, carriers would have to design and implement administrative systems that track the origin and destination of traffic and account for differing state or carrier rates. Developing and implementing such administrative systems may present a significant compliance burden for small entities.

99. The FNPRM seeks comment on the need for new or revised network interconnection rules. Some of the CPNP plans submitted for consideration in this proceeding retain the current network interconnection rules. Varying and inconsistent interpretations of these interconnection rules have led to numerous disputes and uncertainty about how the rules are to be applied. A CPNP plan that retains the current network interconnection rules will inherit this uncertainty surrounding the existing rules. Any changes in such rules also could result in new burdens for some carriers.

100. Adoption of a unified CPNP plan may necessitate changes in interconnection agreements. Interconnection agreements may be premised on rates that would be modified under a unified CPNP plan. Similarly, any change in interconnection rules could lead to renegotiation of agreements. Carriers, including small entities, would likely seek to renegotiate their existing interconnection agreements as a result of any new regime. Renegotiation of existing interconnection agreements may present a significant burden to small entities under a CPNP approach.

101. Each of the unified CPNP plans under consideration assumes revenue neutrality for incumbent LECs with significant funding coming from universal service mechanisms. Some of the plans also include new universal service mechanisms. Under some plans, carriers will have to determine their costs and demonstrate a shortfall between their costs and revenues in order to qualify for funding from cost recovery mechanisms. Further, some types of carriers, including small entities, may not be eligible for some of the cost recovery mechanisms included in some of the plans. Determining costs, determining eligibility under any new universal service plan, and administration related to any new universal service plan may represent significant burdens to small entities under a unified CPNP plan.

102. In this FNPRM, the Commission seeks comment on several issues related to transit service. If, as a result of this FNPRM, new rules related to transit service come into existence, these rules may impose burdens on some entities. Rules imposing transit service obligations would likely have no significant impact on ILECs already providing, or carriers already using transit service. For carriers that would be affected, the burdens may include determining the price of transit service purchased or provided, and developing additional administrative capabilities to account for providing or receiving transit service.

103. The Commission also seeks comment regarding possible changes to the intraMTA rule, negotiation of CMRS interconnection agreements, and rating of CMRS traffic, as discussed in this FNPRM. If the Commission changes the intraMTA rule, or otherwise changes parties' obligations, the new rules will likely relieve some burdens, including lowering the level of resources carriers must devote to resolving disputes arising from ambiguities in the current rules. Carriers may also experience burdens associated with bringing operations and interconnection agreements into compliance with the new rules.

104. The RFA requires an agency to describe any significant alternatives that it has considered in reaching its proposed approach, which may include the following four alternatives (among others): (1) The establishment of differing compliance or reporting requirements or timetables that take into account the resources available to small entities; (2) the clarification, consolidation, or simplification of compliance or reporting requirements under the rule for small entities; (3) the use of performance, rather than design, standards; and (4) an exemption from coverage of the rule, or any part thereof, for small entities.

105. In this FNPRM, the Commission seeks comments on a variety of intercarrier compensation reform plans submitted in the record in this proceeding, as well as on other issues related to reform of the existing intercarrier compensation system. The Commission is aware that some of the proposals under consideration may create burdens for small entities. Consequently, the Commission seeks comments on alternatives that will minimize burdens, discussed below.

106. Several commenters have expressed a preference for maintaining a CPNP regime, and have submitted plans to replace or reform the current intercarrier compensation system with a more unified CPNP approach. For instance, the ARIC plan includes a single rate based on embedded costs for each carrier. The EPG plan uses current interstate access rates as a cost standard. The CBICC plan uses the TELRIC costs of ILEC tandem switching to determine the intercarrier compensation rate. The Commission seeks comment on the economic impact on small entities of these plans relative to other plans contained in the record, and to a bill-and-keep approach.

107. One non-unified option under consideration for intercarrier compensation system reform is to maintain a CPNP based system without immediately adopting a unified approach. For instance, NASUCA recommends a plan that reduces intrastate access charges over a five-year transition period, and then moves to more unified rates.

108. Another non-unified approach the Commission is considering includes use of an incremental cost methodology to meet the section 252(d) “additional cost” standard for reciprocal compensation. The Commission seeks comment on the economic impact of such a plan relative to other plans contained in the record, and to a bill-and-keep approach.

109. Throughout this proceeding, the Commission has recognized the unique needs and interests of small entities. In this FNPRM the Commission seeks comment on several issues and measures under consideration that are uniquely applicable to small entities. Specifically, the Commission seeks comment on whether any intercarrier compensation reform measures adopted should be revenue neutral. The Commission also seeks comment on the impact of reduced intercarrier revenues to small entities in the event that a bill-and-keep approach is adopted.

110. The Commission also seeks comment on whether separate network interconnection rules are necessary or appropriate for small entities, such as rate-of-return carriers. Parties responding to this supplemental IRFA supporting such an approach should explain how separate rules would be structured, and what criteria would be used to determine whether an entity qualified to use the separate rules.

111. Additionally, the Commission seeks comment on whether separate cost recovery mechanisms unique to small entities are necessary or appropriate. Parties responding to this Supplemental IRFA in support of separate cost recovery mechanisms for small entities should explain how the separate cost recovery mechanisms would operate, how they would be funded, and what criteria would be used to determine what entities qualify for funding from the separate mechanisms. Further, the Commission seeks comment on the feasibility of retaining an intercarrier compensation mechanism for small entities only, while moving to another system (e.g. bill-and-keep) for all other entities. Parties advocating this approach should explain how a system of intercarrier payments available only to small entities would be integrated with another intercarrier compensation mechanism, such as a bill-and-keep system, that is in place for other carriers.

112. Finally, the Commission seeks comment on whether separate consideration for small entities is necessary or appropriate for each of the following issues previously discussed in this FNPRM: The potential impact of rules imposing transit service obligations; the potential impact of rules related to negotiation of CMRS interconnection; and the potential impact of rules related to rating and routing of CMRS traffic.

113. Implementation of any of the rule changes the Commission is considering in this FNPRM may require extensive modifications to existing Federal Rules. The need for modifications does not necessarily mean that the new rules duplicate, overlap, or conflict with existing rules. Rather, amendments to the existing rules would be necessary to codify the policies the Commission adopts. The sections of the Commission's rules that would likely have to be amended include, without limitation, the following: Part 32: Uniform System of Accounts for Telecommunications Companies; Part 36: Jurisdictional Separations Procedures; Standard Procedures for Separating Telecommunications Property Costs, Revenues, Expenses, Taxes, and Reserves for Telecommunications Companies; Part 51: Interconnection; Part 54: Universal Service; Part 61: Tariffs; and Part 69: Access Charges.

114. Pursuant to sections 1.415 and 1.419 of the Commission's rules, interested parties may file comments by May 23, 2005 and reply comments by June 22, 2005. Comments may be filed using the Commission's Electronic Comment Filing System (ECFS) or by filing paper copies. Comments filed through the ECFS can be sent as an electronic file via the Internet to http://www.fcc.gov/cgb/ecfs/. Generally, only one copy of an electronic submission must be filed. If multiple docket or rulemaking numbers appear in the caption of the proceeding, commenters must transmit one electronic copy of the comments to each docket or rulemaking number referenced in the caption. In completing the transmittal screen, commenters should include their full name, U.S. Postal Service mailing address, and the applicable docket or rulemaking number, in this case, CC Docket No. 01-92. Parties may also submit an electronic comment by Internet e-mail. To get filing instructions for e-mail comments, commenters should send an e-mail to ecfs@fcc.gov, and should include the following words in the body of the message, “get form.” A sample form and directions will be sent in reply. Parties who choose to file by paper must file an original and four copies of each filing. If more than one docket or rulemaking number appears in the caption of this proceeding, commenters must submit two additional copies for each additional docket or rulemaking number.

115. Filings can be sent by hand or messenger delivery, by commercial overnight courier, or by first-class or overnight U.S. Postal Service mail (although the Commission continues to experience delays in receiving U.S. Postal Service mail). Parties are strongly encouraged to file comments electronically using the Commission's ECFS.

116. The Commission's contractor, Natek, Inc., will receive hand-delivered or messenger-delivered paper filings for the Commission's Secretary at 236 Massachusetts Avenue, NE., Suite 110, Washington, DC 20002.

117. All filings must be addressed to the Commission's Secretary, Marlene H. Dortch, Office of the Secretary, Federal Communications Commission, 445 12th Street, SW., Washington, DC 20554. Parties should also send a copy of their filings to Victoria Goldberg, Pricing Policy Division, Wireline Competition Bureau, Federal Communications Commission, Room 5-A266, 445 12th Street, SW., Washington, DC 20554, or by e-mail to victoria.goldberg@fcc.gov. Parties shall also serve one copy with the Commission's copy contractor, Best Copy and Printing, Inc. (BCPI), Portals II, 445 12th Street, SW., Room CY-B402, Washington, DC 20554, (202) 488-5300, or via e-mail to fcc@bcpiweb.com.

118. Documents in CC Docket No. 01-92 are available for public inspection and copying during business hours at the FCC Reference Information Center, Portals II, 445 12th St. SW., Room CY-A257, Washington, DC 20554. The documents may also be purchased from BCPI, telephone (202) 488-5300, facsimile (202) 488-5563, TTY (202) 488-5562, e-mail fcc@bcpiweb.com.

119. This document does not contain proposed information collection(s) subject to the Paperwork Reduction Act of 1995 (PRA), Public Law 104-13. In addition, therefore, it does not contain any proposed “information collection burden for small business concerns with fewer than 25 employees,” pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4).

120. Accordingly, it is ordered that, pursuant to the authority contained in sections 1-5, 7, 10, 201-05, 207-09, 214, 218-20, 225-27, 251-54, 256, 271, 303, 332, 403, 405, 502 and 503 of the Communications Act of 1934, as amended, 47 U.S.C. 151-155, 157, 160, 201-05, 207-09, 214, 218-20, 225-27, 251-54, 256, 271, 303, 332, 403, 405, 502, and 503 and sections 1.1, 1.421 of the Commission's rules, 47 CFR 1.1, 1.421, notice is hereby given of the rulemaking and comment is sought on those issues.

121. It is further ordered that the Commission's Consumer and Governmental Affairs Bureau, Reference Information Center, shall send a copy of this Further Notice of Proposed Rulemaking, including the Supplemental Initial Regulatory Flexibility Analysis, to the Chief Counsel for Advocacy of the Small Business Administration.

This is a synopsis of the Commission's Notice of Proposed Rule Making, MB Docket No. 05-102, adopted March 9, 2005, and released March 14, 2005. As noted, an Order to Show Cause was issued to Jacor Broadcasting of Colorado, Inc., licensee of Station KRFX(FM), Denver, Colorado, affording it 30 days to express in writing an intention to seek authority to upgrade its technical facilities to preserve Class C status, or otherwise challenge the proposed action. Jacor responded and filed the necessary application (File No. BPH-20030424AAO) which was granted and then rescinded. See Public Notice, Report No. 25498 (June 3, 2003). On November 9, 2004, that application (File No. BPH-20030424AAO) was dismissed. See Letter to Marissa G. Repp, Esq., BPH-20030424AAN, et al., Reference 1800B3 (Chief, Audio Div. November 9, 2004). That action remains pending on reconsideration and any action taken herein is subject to the outcome of that proceeding.

The full text of this Commission decision is available for inspection and copying during normal business hours in the FCC's Reference Information Center at Portals II, CY-A257, 445 Twelfth Street, SW., Washington, DC. This document may also be purchased from the Commission's duplicating contractors, Best Copy and Printing, Inc., 445 12th Street, SW., Room CY-B402, Washington, DC 20054, telephone 1-800-378-3160 or http://www.BCPIWEB.com. This document does not contain proposed information collection requirements subject to the Paperwork Reduction Act of 1995, Public Law 104-13. In addition, therefore, it does not contain any proposed information collection burden “for small business concerns with fewer than 25 employees,” pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4).

Provisions of the Regulatory Flexibility Act of 1980 do not apply to this proceeding.

Members of the public should note that from the time a Notice of Proposed Rule Making is issued until the matter is no longer subject to Commission consideration or court review, all ex parte contacts are prohibited in Commission proceedings, such as this one, which involve channel allotments. See 47 CFR 1.1204(b) for rules governing permissible ex parte contacts.

For information regarding proper filing procedures for comments, see 47 CFR 1.415 and 1.420.

For the reasons discussed in the preamble, the Federal Communications Commission proposes to amend 47 CFR part 73 as follows:

This is a synopsis of the Commission's Notice of Proposed Rule Making, MB Docket No. 05-101, adopted March 9, 2005, and released March 14, 2005. The full text of this Commission decision is available for inspection and copying during normal business hours in the FCC's Reference Information Center at Portals II, CY-A257, 445 Twelfth Street, SW., Washington, DC. The complete text of this decision may also be purchased from the Commission's duplicating contractor, Best Copy and Printing, Inc., 445 12th Street, SW., Room CY-B402, Washington, DC 20054, telephone 1-800-378-3160 or http://www.BCPIWEB.com. This document does not contain proposed information collection requirements subject to the Paperwork Reduction Act of 1995, Public Law 104-13. In addition, therefore, it does not contain any proposed information collection burden “for small business concerns with fewer than 25 employees,” pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4).

Provisions of the Regulatory Flexibility Act of 1980 do not apply to this proceeding.

Members of the public should note that from the time a Notice of Proposed Rule Making is issued until the matter is no longer subject to Commission consideration or court review, all ex parte contacts are prohibited in Commission proceedings, such as this one, which involve channel allotments. See 47 CFR 1.1204(b) for rules governing permissible ex parte contacts.

For information regarding proper filing procedures for comments, see 47 CFR 1.415 and 1.420.

For the reasons discussed in the preamble, the Federal Communications Commission proposes to amend 47 CFR part 73 as follows:

This is a synopsis of the Commission's Notice of Proposed Rule Making, MB Docket No. 05-100, adopted March 9, 2005, and released March 14, 2005. The full text of this Commission decision is available for inspection and copying during normal business hours in the FCC's Reference Information Center at Portals II, CY-A257, 445 Twelfth Street, SW., Washington, DC. The complete text of this decision may also be purchased from the Commission's duplicating contractor, Best Copy and Printing, Inc., 445 12th Street, SW., Room CY-B402, Washington, DC 20054, telephone 1-800-378-3160 or http://www.BCPIWEB.com. This document does not contain proposed information collection requirements subject to the Paperwork Reduction Act of 1995, Public Law 104-13. In addition, therefore, it does not contain any proposed information collection burden “for small business concerns with fewer than 25 employees,” pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4).

Provisions of the Regulatory Flexibility Act of l980 do not apply to this proceeding.

Members of the public should note that from the time a Notice of Proposed Rule Making is issued until the matter is no longer subject to Commission consideration or court review, all ex parte contacts are prohibited in Commission proceedings, such as this one, which involve channel allotments. See 47 CFR 1.1204(b) for rules governing permissible ex parte contacts.

For information regarding proper filing procedures for comments, see 47 CFR 1.415 and 1.420.

For the reasons discussed in the preamble, the Federal Communications Commission proposes to amend 47 CFR part 73 as follows:

This is a synopsis of the Commission's Notice of Proposed Rule Making, MB Docket Nos. 05-97, 05-98, adopted March 9, 2005 and released March 14, 2005. The full text of this Commission decision is available for inspection and copying during regular business hours at the FCC's Reference Information Center, Portals II, 445 Twelfth Street, SW., Room CY-A257, Washington, DC 20554. The complete text of this decision may also be purchased from the Commission's duplicating contractor, Best Copy and Printing, Inc., 445 12th Street, SW., Room CY-B402, Washington, DC, 20054, telephone 1-800-378-3160 or http://www.BCPIWEB.com. This document does not contain proposed information collection requirements subject to the Paperwork Reduction Act of 1995, Public Law 104-13. In addition, therefore, it does not contain any proposed information collection burden “for small business concerns with fewer than 25 employees,” pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4).

Provisions of the Regulatory Flexibility Act of l980 do not apply to this proceeding.

Members of the public should note that from the time a Notice of Proposed Rule Making is issued until the matter is no longer subject to Commission consideration or court review, all ex parte contacts are prohibited in Commission proceedings, such as this one, which involve channel allotments. See 47 CFR 1.1204(b) for rules governing permissible ex parte contact.

For information regarding proper filing procedures for comments, see 47 CFR 1.415 and 1.420.

For the reasons discussed in the preamble, the Federal Communications Commission proposes to amend 47 CFR Part 73 as follows:

This is a synopsis of the Commission's Notice of Proposed Rule Making, MB Docket No. 05-99, adopted March 9, 2005 and released March 14, 2005. The full text of this Commission decision is available for inspection and copying during regular business hours in the FCC's Reference Information Center at Portals II, 445 12th Street, SW., CY-A257, Washington, DC 20554. This document may also be purchased from the Commission's duplicating contractors, Best Copy and Printing, Inc., Portals II, 445 12th Street, SW., Room CY-B402, Washington, DC 20554, telephone 1-800-378-3160 or http://www.BCPIWEB.com. This document does not contain proposed information collection requirements subject to the Paperwork Reduction Act of 1995, Public Law 104-13. In addition, therefore, it does not contain any proposed information collection burden “for small business concerns with fewer than 25 employees,” pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4).

The provisions of the Regulatory Flexibility Act of 1980 do not apply to this proceeding.

Members of the public should note that from the time a Notice of Proposed Rule Making is issued until the matter is no longer subject to Commission consideration or court review, all ex parte contacts are prohibited in Commission proceedings, such as this one, which involve channel allotments. See 47 CFR § 1.1204(b) for rules governing permissible ex parte contacts.

For information regarding proper filing procedures for comments, see 47 CFR §§ 1.415 and 1.420.

For the reasons discussed in the preamble, the Federal Communications Commission proposes to amend 47 CFR Part 73 as follows:

This is a synopsis of the Commission's Notice of Proposed Rule Making, MB Docket No. 05-104, adopted March 9, 2005, and released March 14, 2005. The full text of this Commission decision is available for inspection and copying during normal business hours in the FCC's Reference Information Center at Portals II, CY-A257, 445 Twelfth Street, SW., Washington, DC. This document may also be purchased from the Commission's duplicating contractors, Best Copy and Printing, Inc., Portals II, 445 12th Street, SW., Room CY-B402, Washington, DC 20054, telephone 1-800-378-3160 or http://www.BCPIWEB.com. This document does not contain proposed information collection requirements subject to the Paperwork Reduction Act of 1995 (PRA), Public Law 104-13. In addition, therefore, it does not contain any proposed information collection burden “for small business concerns with fewer than 25 employees,” pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4).

Additionally, Channel 222C2 can be reallotted to Cherokee Village at Station KSAR(FM)'s presently licensed site. The coordinates for Channel 222C2 at Cherokee Village are 36-21-58 North Latitude and 91-28-35 West Longitude. Moreover, Channel 254A can be allotted to Cave City with a site restriction of 1.0 kilometers (0.6 miles) southwest to avoid a short-spacing to the licensed site of Station WJZN(FM), Channel 255C1, Munford, Tennessee. The coordinates for Channel 254A at Cave City are 35-56-11 North Latitude and 91-33-27 West Longitude. Channel 253C0 can be reclassified at Little Rock at Station KURB(FM)'s presently licensed site. The coordinates for Channel 253C0 at Little Rock are 34-47-56 North Latitude and 92-29-44 West Longitude. Pursuant to Section 1.420(i) of the Commission's Rules, we will not accept competing expressions of interest for the use of Channel 252C2 at Black Rock, Arkansas, or the use of Channel 222C2 at Cherokee Village, Arkansas, or require the joint petitioners to demonstrate the existence of an equivalent class channel for use of other interested parties.

Provisions of the Regulatory Flexibility Act of 1980 do not apply to this proceeding. Members of the public should note that from the time a Notice of Proposed Rule Making is issued until the matter is no longer subject to Commission consideration or court review, all ex parte contacts are prohibited in Commission proceedings, such as this one, which involve channel allotments. See 47 CFR 1.1204(b) for rules governing permissible ex parte contacts.

For information regarding proper filing procedures for comments, see 47 CFR 1.415 and 1.420.

For the reasons discussed in the preamble, the Federal Communications Commission proposes to amend 47 CFR Part 73 as follows:

This is a summary of the Commission's Notice of Proposed Rulemaking (NPRM), FCC 05-49, adopted on March 2, 2005, and released on March 7, 2005. The full text of this document is available for public inspection and copying during regular business hours in the FCC Reference Center, Federal Communications Commission, 445 12th Street, SW., CY-A257, Washington, DC 20554. These documents will also be available via ECFS (http://www.fcc.gov/cgb/ecfs/). (Documents will be available electronically in ASCII, Word 97, and/or Adobe Acrobat.) The complete text may be purchased from the Commission's copy contractor, 445 12th Street, SW., Room CY-B402, Washington, DC 20554. To request this document in accessible formats (computer diskettes, large print, audio recording, and Braille), send an e-mail to fcc504@fcc.gov or call the Commission's Consumer and Governmental Affairs Bureau at (202) 418-0530 (voice), (202) 418-0432 (TTY).

This document does not contain proposed information collection requirements subject to the Paperwork Reduction Act of 1995, Public Law 104-13. In addition, therefore, it does not contain any proposed information collection burden “for small business concerns with fewer than 25 employees,” pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-198; see 44 U.S.C. 3506(c)(4).

1. In the NPRM we seek comment on the implementation of Section 207 of the Satellite Home Viewer Extension and Reauthorization Act of 2004 (“SHVERA”). Section 207 extends section 325(b)(3)(C) of the Communications Act until 2010 and amends that section to impose reciprocal good faith retransmission consent bargaining obligations on multichannel video programming distributors (“MVPDs”). This section alters the bargaining obligations created by the Satellite Home Viewer Improvement Act of 1999 (“SHVIA”) which imposed a good faith bargaining obligation only on broadcasters. As discussed below, because the Commission has in place existing rules governing good faith retransmission consent negotiations and because Congress did not instruct us through the SHVERA to modify those rules in any substantive way, we tentatively conclude that the most faithful and expeditious implementation of the amendments contemplated in section 207 of the SHVERA is to extend to MVPDs the existing good faith bargaining obligation imposed on broadcasters under our rules.

2. Section 325(b)(3)(C) of the Communications Act, as enacted by the SHVIA, instructed the Commission to commence a rulemaking proceeding to revise the regulations by which television broadcast stations exercise their right to grant retransmission consent; see 47 U.S.C. 325(b)(3)(C). Specifically, that section required that the Commission, until January 1, 2006:

3. The Good Faith Order determined that Congress did not intend to subject retransmission consent negotiation to detailed substantive oversight by the Commission; see 15 FCC Rcd at 5450. Instead, the order found that Congress intended that the Commission follow established precedent, particularly in the field of labor law, in implementing the good faith retransmission consent negotiation requirement; see 15 FCC Rcd at 5453-54. Consistent with this conclusion, the Good Faith Order adopted a two-part test for good faith. The first part of the test consists of a brief, objective list of negotiation standards; see 15 FCC Rcd at 5457-58. First, a broadcaster may not refuse to negotiate with an MVPD regarding retransmission consent. Second, a broadcaster must appoint a negotiating representative with authority to bargain on retransmission consent issues. Third, a broadcaster must agree to meet at reasonable times and locations and cannot act in a manner that would unduly delay the course of negotiations. Fourth, a broadcaster may not put forth a single, unilateral proposal. Fifth, a broadcaster, in responding to an offer proposed by an MVPD, must provide considered reasons for rejecting any aspects of the MVPD's offer. Sixth, a broadcaster is prohibited from entering into an agreement with any party conditioned upon denying retransmission consent to any MVPD. Finally, a broadcaster must agree to execute a written retransmission consent agreement that sets forth the full agreement between the broadcaster and the MVPD; see 47 CFR 76.65(b)(1)(i) through (vii).

4. The second part of the good faith test is based on a totality of the circumstances standard. Under this standard, an MVPD may present facts to the Commission which, even though they do not allege a violation of the specific standards enumerated above, given the totality of the circumstances constitute a failure to negotiate in good faith; see 47 CFR 76.65(b)(2).

5. The Good Faith Order provided examples of negotiation proposals that presumptively are consistent and inconsistent with “competitive marketplace considerations;” see 15 FCC Rcd at 5469-70. The Good Faith Order found that it is implicit in section 325(b)(3)(C) that any effort to further anti-competitive ends through the negotiation process would not meet the good faith negotiation requirement; see 15 FCC Rcd at 5470. The order stated that considerations that are designed to frustrate the functioning of a competitive market are not “competitive marketplace considerations.” Further, conduct that is violative of national policies favoring competition—that, for example, is intended to gain or sustain a monopoly, an agreement not to compete or to fix prices, or involves the exercise of market power in one market in order to foreclose competitors from participation in another market—is not within the competitive marketplace considerations standard included in the statute; see 15 FCC Rcd at 5470.

6. Finally, the Good Faith Order established procedural rules for the filing of good faith complaints pursuant to section 76.7 of the Commission's rules; see 47 CFR 76.65(c), 47 CFR 76.7. The burden of proof is on the complainant to establish a good faith violation and complaints are subject to a one year limitations period; see 47 CFR 76.65(d) and (e).

7. In enacting the SHVERA good faith negotiation obligation for MVPDs, Congress used language identical to that of the SHVIA imposing a good faith obligation on broadcasters, requiring the Commission, until January 1, 2010, to:

8. We note that the original SHVIA good faith provision by its terms applied to “television broadcast stations.” Similarly, the SHVERA good faith provision applies to “multichannel video programming distributors.” We seek comment whether, under the statute, the good faith negotiating standards may be any different for carriage of significantly viewed television broadcast stations outside of their designated market area (“DMA”) (A DMA is a geographic market designation created by Nielsen Media Research that defines each television market exclusive of others, based on measured viewing patterns. Essentially, each county in the United States is allocated to a market based on which home-market stations receive a preponderance of total viewing hours in the county. For purposes of this calculation, both over-the-air and cable television viewing are included.) Significantly viewed television broadcast stations do not have carriage rights outside of their DMA and carriage of their signals by out-of-market MVPDs is permissive. We seek comment as to whether the Commission has discretion under section 325(b)(3)(C) to distinguish this situation. For example, if a television broadcast station from DMA X is significantly viewed in DMA Y and seeks carriage on an MVPD located in DMA Y, must the MVPD in DMA Y negotiate retransmission consent in good faith with the broadcaster from DMA X in exactly the same way that it negotiates with broadcasters that are located in DMA Y? Should the same good faith negotiation standard apply to broadcasters and MVPDs regardless of the DMA in which they reside? Should a different standard apply, and if so what standard? Should the good faith retransmission consent negotiation obligation apply only to MVPDs and broadcasters located in the same DMA? We seek comment on this issue.

9. Permit-But-Disclose. This proceeding will be treated as a “permit-but-disclose” proceeding subject to the “permit-but-disclose” requirements under section 1.1206(b) of the Commission's rules; see 47 CFR 1.1206(b), 47 CFR 1.1202, 1.1203. Ex parte presentations are permissible if disclosed in accordance with Commission rules, except during the Sunshine Agenda period when presentations, ex parte or otherwise, are generally prohibited. Persons making oral ex parte presentations are reminded that a memorandum summarizing a presentation must contain a summary of the substance of the presentation and not merely a listing of the subjects discussed. More than a one- or two-sentence description of the views and arguments presented is generally required; see 47 CFR 1.1206(b)(2). Additional rules pertaining to oral and written presentations are set forth in section 1.1206(b).

10. Comments may be filed electronically using the Internet by accessing the the Commission's Electronic Comment Filing System (“ECFS”): http://www.fcc.gov/cgb/ecfs/ or the Federal eRulemaking Portal: http://www.regulations.gov. Filers should follow the instructions provided on the Web site for submitting comments. Parties may also submit an electronic comment by Internet e-mail. To get filing instructions, filers should send an e-mail to ecfs@fcc.gov, and include the following words in the body of the message, “get form.” A sample form and directions will be sent in response. Parties who choose to file by paper must file an original and four copies of each filing. All filings must be addressed to the Commission's Secretary, Office of the Secretary, Federal Communications Commission, 445 12th Street, SW., Room TW-A325, Washington, DC 20554. In addition to filing comments with the Secretary, a copy of any comments on the Paperwork Reduction Act information collection requirements contained herein should be submitted to Judith B. Herman, Federal Communications Commission, Room 1-C804, 445 12th Street, SW., Washington, DC 20554, or via the Internet to Judith-B.Herman@fcc.gov, and to Kristy L. LaLonde, OMB Desk Officer, Room 10234 NEOB, 725 17th Street, NW., Washington, DC 20503, via the Internet to Kristy_L. LaLonde@omb.eop.gov, or via fax at 202-395-5167.

11. Accordingly, it is ordered that pursuant to section 207 of the Satellite Home Viewer Extension and Reauthorization Act of 2004, and sections 1, 4(i) and (j), and 325 of the Communications Act of 1934, as amended, 47 U.S.C. 151, 154(i) and (j), and 325, notice is hereby given of the proposals and tentative conclusions described in this Notice of Proposed Rulemaking.

12. It is further ordered that the Reference Information Center, Consumer and Governmental Affairs Bureau, shall send a copy of this Notice of Proposed Rulemaking, including the Initial Regulatory Flexibility Analysis, to the Chief Counsel for Advocacy of the Small Business Administration.

For the reasons discussed in the preamble, the Federal Communications Commission proposes to amend 47 CFR part 76 as follows:

We are requesting information for both the proposed rule and the 5-year review, as we are conducting these reviews simultaneously.

We intend that any final action resulting from this proposed reclassification will be as accurate and as effective as possible. Therefore, we solicit comments or suggestions from the public, other concerned governmental agencies, the scientific community, industry, or any other interested parties concerning this proposal. We particularly seek comments concerning:

(1) Biological, commercial trade, or other relevant data concerning any threat (or lack thereof) to this species;

(2) The location of any additional populations of the American crocodile within the extent of its range covered by this proposed rule;

(3) Additional information concerning the range, distribution, and population size of this species in Florida;

(4) Current management plans or anticipated plan development that incorporates actions that will benefit or impact the American crocodile in Florida;

(5) Current or planned activities within the geographic area addressed by this proposal and their potential impact on this species; and

(6) Whether the current status of this population of the American crocodile is more appropriately described as “recovered,” threatened due to similarity of appearance,” or in some other way different than the proposal made here.

Please submit electronic comments in ASCII file format and avoid the use of special characters and encryption. Please also include “Attn: [RIN 1018-AI41]” and your name and return address in your e-mail message. If you do not receive a confirmation from the system that we have received your e-mail message, contact us directly by calling our South Florida Ecological Services Office (see ADDRESSES section).

Our practice is to make all comments, including names and home addresses of respondents, available for public review during regular business hours. Individual respondents may request that we withhold their home address from the rulemaking record, which we will honor to the extent allowable by law. In some circumstances, we would withhold also from the rulemaking record a respondent's identity, as allowable by law. If you wish for us to withhold your name and/or address, you must state this prominently at the beginning of your comments. However, we will not consider anonymous comments. We will make all submissions from organizations or businesses, and from individuals identifying themselves as representatives or officials of organizations or businesses, available for public inspection in their entirety.

The American crocodile is a large greenish-gray reptile. It is one of two native crocodilians (the other being the American alligator (Alligator mississippiensis)) that occur in the continental United States, and is limited in distribution in the United States to the southern tip of mainland Florida and the upper Florida Keys (Kushlan and Mazzotti 1989a). At hatching, crocodiles are yellowish-tan to gray in color with vivid dark bands on the body and tail. As they grow older, their overall coloration becomes more pale and uniform and the dark bands fade. All adult crocodiles have a hump above the eye, and tough, asymmetrical armor-like scutes (scale-like plates) on their backs. The American crocodile is distinguished from the American alligator by a relatively narrow, more pointed snout and by an indentation in the upper jaw that leaves the fourth tooth of the lower jaw exposed when the mouth is closed. In Florida, the American crocodile ranges in size from 26.0 centimeters (cm) (10.3 inches (in)) at hatching, to an upper length of 3.8 meters (m) (12.5 feet (ft)) (Moler 1991a). Larger specimens in Florida were reported in the 1800s (Moler 1991a), and individuals as large as 6 to 7 m (19.7 to 23.0 ft) have been reported outside the United States (Thorbjarnarson 1989).

The American crocodile occurs in coastal regions of both the Atlantic and Pacific coasts, in southern Mexico, Central America, and northern South America, as well as the Caribbean islands (Thorbjarnarson 1989). It reaches the northern extent of its range in the southern tip of Florida (Kushlan and Mazzotti 1989a, Thorbjarnarson 1989). The species occurs within the jurisdictional boundaries of many different governments in the western hemisphere, including Belize, Colombia, Costa Rica, Cuba, Dominican Republic, Ecuador, El Salvador, Florida (USA), Guatemala, Haiti, Honduras, Jamaica, Nicaragua, Mexico, Panama, Peru, and Venezuela.

The first documented occurrence of a crocodile in the United States resulted from the collection of a crocodile in 1869 in the Miami River off Biscayne Bay, though crocodiles were earlier suspected to occur there (Kushlan and Mazzotti 1989a). Within the United States, the historic core geographic range of crocodiles includes Miami-Dade, Broward, and Monroe Counties in Florida, but reports indicate that they occupied areas as far north as Indian River County on the east coast (Kushlan and Mazzotti 1989a). Crocodiles were probably never common on the west coast of Florida, but credible reports suggest that they occurred at least periodically as far north as Sanibel Island and Sarasota County (Kushlan and Mazzotti 1989a). The primary historic nesting area was on the mainland shore of Florida and Biscayne Bays, including many of the small islands near shore, in what is today Everglades National Park (Kushlan and Mazzotti 1989a). Nesting was also historically well-documented in the upper Keys from Key Largo south to Lower Matecumbe Key (Kushlan and Mazzotti 1989a). Reports of crocodile nests on Little Pine Key (Ogden 1978), and occurrences on Key West (Ogden 1978) suggest that crocodiles were once more common in the Keys than they are today.

In 1976, the American crocodile population in Florida was estimated to be between 200 and 300 individuals (40 FR 58308), with only 10 to 20 breeding females estimated in 1975 (40 FR 44149). Most of the remaining animals and known nesting activity during this time were concentrated in a small portion of their historic range in northeastern Florida Bay (Kushlan and Mazzotti 1989a).

Today, the population of American crocodiles in Florida has grown to an estimated 500 to 1,000 individuals, not including hatchlings (P. Moler, Florida Fish and Wildlife Conservation Commission (FWC), personal communication 2004; F. Mazzotti, University of Florida (UF), personal communication 2004). This estimate, developed by two established American crocodile experts, is based on a demographic characteristic that has proven true for both Nile crocodiles and American alligators. The characteristic is based on a generality from crocodilian research, that breeding females make up 4 to 5 percent of the non-hatchling population size. This estimate exhibits a large range, because the researchers used a range of 40 to 50 crocodile nests existing in Florida to do their calculations (P. Moler, FWC, personal communication 2004; F. Mazzotti, UF, personal communication 2004). We believe this is a reasonable but conservative estimate, because as stated below nesting has increased to 61 documented nests in 2003 and not all mature females breed and nest each year.

The nesting range has also expanded on both the east and west coasts of the State, and crocodiles are frequently being seen throughout most of their historical range. Nesting has extended back into Biscayne Bay on Florida's east coast, and now commonly occurs at the Turkey Point Nuclear Plant (Brandt et al. 1995, Gaby et al. 1985). During 2003, 61 crocodile nests were discovered in south Florida (S. Klett, Service, personal communication 2003; M. Cherkiss, personal communication 2003; J. Wasilewski, Natural Selections Inc., personal communication 2003), and nesting has been increasing for several years (Ogden 1978, Brandt et al. 1995, Kushlan and Mazzotti 1989b, Moler 1991b, Mazzotti et al. 2000, Mazzotti and Cherkiss 2001, and Mazzotti et al. 2002). Approximately 75 percent of reproductively mature females breed and nest each year (F. Mazzotti, personal communication 2001), suggesting that the actual number of nesting females may be higher than the 61 nests recorded. Surveys detect approximately 80 to 90 percent of nests (F. Mazzotti, personal communication 2001; J. Wasilewski, personal communication 2002), and surveyors are generally unable to distinguish those nests that contain more than one clutch of eggs from different females without researchers excavating the nests. We believe this situation lends to a possible underestimation of nests or females, because on occasion 2 females lay eggs in the same nest.

The breeding range of the American crocodile today is still restricted relative to its reported historic range (Kushlan and Mazzotti 1989a), with most breeding occurring on the mainland shore of Florida Bay between Cape Sable and Key Largo (Mazzotti et al. 2002). Crocodiles no longer regularly occur in the Keys south of Key Largo (P. Moler, personal communication 2002, Jacobsen 1983), though individuals have occasionally been observed in the lower Keys in recent years. An American crocodile was also observed for the first time near Fort Jefferson in the Dry Tortugas in May 2002 (O. Bass, Everglades National Park, personal communication 2002). We believe that these occasional observations may indicate that crocodiles are expanding their range back into the Keys, but Key Largo is the only nesting area currently known in the Florida Keys.

Crocodiles live primarily in the sheltered, fresh, or brackish waters of mangrove-lined bays, mangrove swamps, creeks, and inland swamps (Kushlan and Mazzotti 1989b). Prolonged exposure to salinities similar to that of seawater (35 parts per thousand (ppt) of sodium) may lead to reduced growth rates, particularly for young crocodiles (Dunson 1982, Dunson and Mazzotti 1989, Mazzotti et al. 1986). Availability of fresh water is a primary factor affecting growth and survival in young crocodiles (Dunson and Mazzotti 1989).

American crocodiles are shy and secretive, and remain solitary for most of the year (Mazzotti 1983); however, they are usually tolerant of other crocodiles in the same general area. Individuals may travel widely throughout their range, but they are generally concentrated around the major nesting areas (Kushlan and Mazzotti 1989b, Mazzotti 1983). Prior to nesting season, males become more territorial, and dominant males may mate with several females (Thorbjarnarson 1989).

Females do not become reproductively active until they reach a total length of approximately 2.3 m (7.4 ft) (Mazzotti 1983), and this generally corresponds to an age of 10 to 13 years (LeBuff 1957, Moler 1991a). Females construct earthen nests (mounds or holes) on elevated, well-drained sites near the water, such as ditch-banks and beaches. Nests have been reported in sand, marl, and organic peat soils, and the nests constructed in these different soils may be susceptible to different environmental conditions and different threats (Lutz and Dunbar-Cooper 1984, Moler 1991b). Female crocodiles will only nest one time per year and may not nest every year after they reach sexual maturity. They lay an average of 38 eggs (Kushlan and Mazzotti 1989b), which will hatch after an incubation period of approximately 90 days (Mazzotti 1989). Flooding, over-drying, and raccoon predation all pose threats to nests and developing eggs (Mazzotti et al. 1988, Mazzotti 1999), and suitable nest sites that are protected from these threats may be limited. The reported percent of nests from which eggs successfully hatch in any one year range from 33 to 78 percent (Ogden 1978, Kushlan and Mazzotti 1989b, Moler 1991b, Mazzotti et al. 2000, Mazzotti and Cherkiss 2001). Typically, a nest was considered successful if at least one hatched eggshell or hatchling crocodile was documented. However, Moler (19991b) classified a nest as successful if “it appeared to have been opened by an adult crocodile. In all but one case, hatchling crocodiles were tagged near each successful nest.”

Unlike alligators, female crocodiles do not defend nest sites (Kushlan and Mazzotti 1989b). However, females remain near their nest sites and must excavate young from the nest after hatching (Kushlan and Mazzotti 1989b). Kushlan (1988) reported that females may be very sensitive to disturbance at the nest site; most females that were disturbed near their nests did not return to excavate their young after hatching. Female crocodiles show little parental care, and young are generally independent shortly after hatching. Hatchlings disperse from nest sites to nursery habitats that are generally more sheltered, have lower salinity (1 to 20 ppt), shallower water (generally), and more vegetation cover, shortly after hatching, where they remain until they grow larger. Growth during the first year can be rapid, and crocodiles may double or triple in size (Moler 1991a). Growth rates in hatchling crocodiles depend primarily on the availability of fresh water and food in the nursery habitat they occupy and may also be influenced by temperature (Mazzotti et al. 1986).

Adult crocodiles have few natural enemies, but hatchlings and young crocodiles are regularly eaten by a variety of wading birds, crabs, mammals, and reptiles, including larger crocodiles. As crocodiles grow, their former predators become prey. The diet of American crocodiles at all ages is varied, and crocodiles forage opportunistically. Fish, crabs, snakes, turtles, and a variety of other small prey compose the majority of their diet. Crocodiles are usually active at night, which is the primary time when they pursue prey.

Land acquisition efforts by many agencies have continued to provide protection for crocodile habitat in south Florida. Crocodile Lake NWR was acquired in 1980 to provide over 2,205 ha (5,000 acres) of crocodile nesting and nursery habitat. In 1980, Everglades National Park established a crocodile sanctuary in northeastern Florida Bay. A total of 46 public properties (including Crocodile Lake NWR and Everglades National Park), owned and managed by Federal, State, or county governments, as well as 3 privately-owned properties (including Turkey Point Nuclear Power Plant) are managed at least partially or wholly for conservation purposes and contain potential crocodile habitat within the coastal mangrove communities in south Florida. For example, in the early 1980s, Everglades National Park plugged canals which allowed crocodiles to begin nesting on the canal berms. In 1976 the C-107 canal was completed and provides habitat for crocodiles at the Turkey Point Nuclear Power Plant. Approximately 95 percent of nesting habitat for crocodiles in Florida is under public ownership (F. Mazzotti, personal communication 2001).

We proposed listing of the United States population of the American crocodile as endangered on April 21, 1975 (40 FR 17590). The proposed listing stated that only an estimated 10 to 20 breeding females remained in Florida, mostly concentrated in northern Florida Bay. The primary threats cited included development pressures, lack of adequate protection of crocodiles and their habitat, and the risk of extinction inherent to a small, isolated population. Comments on the proposed rule were received from 14 parties including representatives of the State of Florida, and all supported listing the American crocodile as endangered in Florida. We published a final rule on September 25, 1975, listing the United States population of the American crocodile as endangered (40 FR 44149).

On December 16, 1975, we published a proposal to designate critical habitat for the American crocodile (40 FR 58308). The proposed critical habitat included portions of Biscayne Bay south of Turkey Point, northeast Florida Bay, including the Keys, and the mainland extending as far west as Flamingo. We published a final rule designating critical habitat on September 24, 1976 (41 FR 41914). The final rule expanded the critical habitat to include a portion of Everglades National Park and northern Florida Bay to the west of the previously proposed area. The additional area lies entirely within Everglades National Park.

On April 6, 1977, we published a proposed rule to list as endangered all populations of the American crocodile with the exception of those in Florida and all populations of the saltwater (estuarine) crocodile (Crocodylus porosus) due to their similarity in appearance to the American crocodile in Florida (42 FR 18287). Under the similarity of appearance clause of Section 4 of the Act, a species may be treated as endangered or threatened for the purposes of commerce or taking if it so closely resembles an endangered species that law enforcement personnel will be unable to distinguish between the listed and unlisted species. We did not finalize this proposed rule.

On February 5, 1979, we provided notice in the Federal Register that a status review was being conducted for the American crocodile (outside of Florida) and the saltwater crocodile (Crocodylus porosus). The notice specified that we had information to suggest that the American crocodile and the saltwater crocodile may have experienced population declines and extensive habitat loss during the previous decade (44 FR 7060).

On July 24, 1979, we published a proposed rule (44 FR 43442) that recommended listing the American and saltwater crocodiles as endangered throughout their ranges outside of Papua New Guinea, citing widespread loss of habitat and extensive poaching for their hides. The Florida population of the American crocodile was not included because it was previously listed as endangered. Saltwater crocodiles were not listed within the jurisdictional boundaries of Papua New Guinea due to strict government control of crocodile farming and assurances that wild populations there were not being threatened.

We listed the American crocodile, with the exception of the previously-listed population in Florida, and the saltwater crocodile throughout its range, with the exception of the Papua New Guinea population, as endangered on December 18, 1979 (44 FR 75074). This action provided protection to these crocodilians worldwide.

Since the Florida population of the American crocodile was listed as endangered, we have conducted numerous consultations under section 7 of the Act for actions that may affect crocodiles. Most potential conflicts have been resolved early in the informal consultation process, resulting in our concurrence with a determination of “not likely to adversely affect.”

One Federal prosecution occurred in the late 1970s for a dredge-and-fill permit violation that affected crocodile habitat on Key Largo within the boundaries of the then-proposed Crocodile Lake National Wildlife Refuge (U.S. v. Joseph R. Harrison, Jr. Civil Action No. 84-1465, Judge E.B. Davis, Final Consent Judgment on September 22, 1984). This case was settled prior to trial.

The Act defines “species” to include “* * * any distinct population segment of any species of vertebrate fish or wildlife which interbreeds when mature.” On February 7, 1996, we published in the Federal Register our Policy Regarding the Recognition of Distinct Vertebrate Population Segments (DPS Policy) (61 FR 4722). For a population to be listed under the Act as a distinct vertebrate population segment, three elements are considered—(1) The discreteness of the population segment in relation to the remainder of the species to which it belongs; (2) the significance of the population segment to the species to which it belongs; and (3) the population segment's conservation status in relation to the Act's standards for listing (i.e., is the population segment endangered or threatened?). The best available scientific information supports recognition of the Florida population of the American crocodile as a distinct vertebrate population segment. We discuss the discreteness and significance of the DPS within this section; the remainder of the document discusses the species' status within the Florida DPS.

Discreteness: The DPS policy states that vertebrate populations may be considered discrete if they are markedly separated from other populations of the same taxon as a consequence of physical, physiological, ecological, or behavioral factors; and/or they are delimited by international governmental boundaries within which significant differences exist in control of exploitation, management of habitat, conservation status, or regulatory mechanisms.

The Florida population segment represents the northernmost extent of the American crocodile's range (Kushlan and Mazzotti 1989a, Thorbjarnarson 1989). It is spatially separated by approximately 90 miles of open ocean from the nearest adjacent American crocodile population in Cuba (Kushlan 1988). The Gulf Stream, or the Florida Current (the southernmost leg of the Gulf Stream), flows through this 90-mile gap. This strong current makes it unlikely that crocodiles would regularly, or even occasionally, move between Florida and Cuba. Behaviorally, American crocodiles are not predisposed to travel across open ocean. They prefer calm waters with minimal wave action, and most frequently occur in sheltered, mangrove-lined estuaries (Mazzotti 1983). No evidence is available to suggest that crocodiles have crossed the Florida Straits. There are no other American crocodile populations in close proximity to Florida (Richards 2003) that would allow direct interaction of animals. The Florida DPS is effectively isolated from other American crocodile populations and functions as a single demographic unit. Consequently, we conclude that the Florida population of American crocodiles is separated from other American crocodile populations as a consequence of physical or behavioral factors.

The genetic makeup of the Florida population of the American crocodile also is recognizably distinct from populations in other geographic areas within its range (M. Forstner, Southwest Texas State University, unpublished data), despite reported evidence of the introduction of genetic material from foreign crocodile populations (M. Forstner, personal communication 2002). Analysis of mitochondrial DNA suggests that the Florida DPS may be genetically more closely related to American crocodile populations in Central and South America than to those in Cuba and the Bahamas (M. Forstner, unpublished data). However, the Florida DPS remains genetically distinct and geographically distant from American crocodiles in central and south America.

In addition to the effective spatial isolation of the Florida population, the regulatory mechanisms providing protection for the crocodile and the level of enforcement of protections are substantially different outside of Florida, across international government boundaries. The first listing of the American crocodile under the Act only included the Florida population, and protection under the Act was extended to populations outside of the United States several years later (see “Previous Federal Actions” section). Florida supports the only population of the American crocodile that is subject to the full jurisdiction of the Act. Though the American crocodile is protected from international commerce by the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES), other countries have distinctly different regulatory mechanisms in place that do not provide the same level of protection from exploitation, disturbance, or loss of habitat within their jurisdictional boundaries for the American crocodile. Cuban laws provide protection to both crocodiles and crocodile habitat (Soberon 2000), and enforcement of those laws is reported to be good (P. Ross, International Union for the Conservation of Nature, Crocodile Specialists Group, personal communication 2002). However, the threats to crocodiles in Cuba are different than in the United States, with most human-caused mortality resulting from subsistence hunting due to a depressed economy. In the Dominican Republic, Jamaica, and Haiti, a wide variety of threats, conservation regulations, and levels of enforcement make the level of protection within these countries difficult to quantify or evaluate. Threats to American crocodile populations vary substantially throughout their range in Central and South America, with threats including malicious killing, illegal subsistence hunting in areas with a depressed economy, incidental mortality during legal caiman hunting, killing by fishermen, and incidental mortality in fishing nets (Ross 1998, Soberon 2000, Platt and Thorbjarnarson 2000, P. Ross personal communication, 2002). Therefore, significant differences do exist in control of exploitation, management of habitat, conservation status, or regulatory mechanisms in areas of the American crocodile's range outside of Florida.

Significance: The DPS policy states that populations that are found to be discrete will then be examined for their biological or ecological significance. This consideration may include evidence that the loss of the population would create a significant gap in the range of the taxon. The Florida population of the American crocodile represents the northernmost portion of its range in the world (Kushlan and Mazzotti 1989a, Thorbjarnarson 1989) and the only U.S. population. Loss of this population would result in a significant reduction of the extent of the species' range. Maintaining a species throughout its historic and current range is important to ensure its genetic diversity and population viability. While it is difficult to determine to what degree the Florida population of the American crocodile contributes substantially to the security of the species as a whole, the apparent isolation and evidence of genetic uniqueness (M. Forstner, Southwest Texas State University, unpublished data) suggest that the Florida population substantially contributes to the overall diversity within the species and is biologically or ecologically significant.

The first recovery plan for the American crocodile was approved on February 12, 1979 (Service 1979). The recovery plan was revised on February 2, 1984 (Service 1984). The recovery plan for the American crocodile was revised again and included as part of the South Florida Multi-Species Recovery Plan (MSRP) (Service 1999). The recovery plan for the crocodile in the MSRP, which was approved in May 1999, represents the current recovery plan for this species.

The MSRP identifies 10 primary recovery actions for the American crocodile. Species-focused recovery actions include: (1) Conduct surveys to determine the current distribution and abundance of American crocodiles; (2) protect and enhance existing colonies of American crocodiles; (3) conduct research on the biology and life history of crocodiles; (4) monitor the south Florida crocodile population; and (5) inform the public about the recovery needs of crocodiles. Habitat-focused recovery actions include: (1) Protect nesting, basking, and nursery habitat of American crocodiles in south Florida; (2) manage and restore suitable habitat of American crocodiles; (3) conduct research on the habitat relationships of the American crocodile; (4) continue to monitor crocodile habitat; and (5) increase public awareness of the habitat needs of crocodiles. All of these primary recovery actions have been initiated since the 1999 MSRP.

American crocodile nest surveys and subsequent hatchling crocodile surveys around nest sites are conducted in all areas where crocodiles nest (Mazzotti et al. 2000, Mazzotti and Cherkiss 2003). Nest monitoring has been conducted nearly continuously at each of the primary nesting areas since 1978. Without these data, we would have little evidence to support reclassification. In addition, detailed surveys and population monitoring have been conducted annually since 1996 throughout the American crocodile's range in Florida. These surveys documented distribution, habitat use, population size, and age class distribution of crocodiles. During both crocodile surveys and nest monitoring, crocodiles of all age classes are captured and marked (Mazzotti and Cherkiss 2003). These marked individuals continue to provide information on survival, longevity, growth, and movements (Mazzotti and Cherkiss 2003). All captured individuals are marked by clipping tail scutes in a prescribed manner so that each crocodile is given an individual identification number (Mazzotti and Cherkiss 2003). In addition, hatchlings at Turkey Point are marked with microchips placed under the skin.

Several ecological studies have been initiated or continued in recent years. Study has continued on the effects of salinity on growth rate and survival of American crocodiles in the wild. Previous laboratory studies provided a general relationship, but field data have improved our understanding of this relationship. In addition, analysis of contaminants in crocodile eggs has been conducted recently at Rookery Bay, and these analyses contribute to a record of contaminants data as far back as the 1970s.

Protection and enhancement of nesting habitat within each of the three primary American crocodile nesting areas has also been ongoing for many years. Turkey Point Nuclear Plant has implemented management actions to minimize disturbance to crocodiles and their nesting habitat. This includes the designation of nesting “sanctuaries” where access and maintenance activities are minimized. Habitat management in these areas includes exotic vegetation control and encouraging the growth of low-maintenance native vegetation. On Crocodile Lake National Wildlife Refuge, management has focused on maintaining suitable nesting substrate. The organic soils that compose the nesting substrate have subsided over time, leading to the potential for increased risk of flooding or unfavorable microclimate. Nesting substrate has been augmented near nesting areas. Encroaching vegetation in nesting areas has also been removed. In Everglades National Park, management has included minimizing disturbance to crocodiles resulting from public use, and relocation of crocodile nests that were placed in recently-excavated spoil material subject to disturbance and inhospitable environmental conditions.

Signs have been in place for several years along highways to alert motorists to the presence of crocodiles in the areas where most crocodile road kills have occurred. Fences were also erected along highways to prevent crocodiles from crossing, although several of these fences were later removed because they were ineffective. The remaining sections of fence are intended to funnel crocodiles to culverts where they can cross underneath roads without risk. Other efforts to reduce human-caused mortality include law enforcement actions and signs that inform the public about crocodiles in areas where crocodiles and people are likely to encounter each other, such as at fish cleaning stations along Biscayne Bay.

The FWC established a standard operating protocol in 1988 to manage crocodile-human interactions. This protocol established a standard procedure that included both public education to encourage tolerance of crocodiles and translocation of crocodiles in situations that may threaten the safety of either crocodiles or humans. While the protocol has led to the successful resolution of many complaints, many of the large crocodiles that have been translocated under the protocol have shown strong site fidelity and have returned to the areas from which they were removed (Mazzotti and Cherkiss 2003). Translocation appears to be effective with small crocodiles (generally < 6 ft total length), but may not completely resolve human-crocodile conflicts involving larger, older animals. Developing an effective, proactive protocol to address human-crocodile conflicts is necessary to ensure the safety of crocodiles of all age groups near populated areas and to help maintain a positive public perception of crocodiles and crocodile conservation. We are working closely with FWC to continue development of an effective human-crocodile conflict management plan and to improve our understanding of how crocodiles respond to translocation.

The MSRP (Service 1999) specifies a recovery objective of reclassifying the species to threatened, and lists recovery criteria as:

Based on the criteria outlined in the MSRP, we can consider the American crocodile for reclassification to threatened status in Florida at this time, because crocodiles and their habitat are still protected and management efforts continue to maintain or enhance the amount and quality of available habitat. In addition, for several reasons, we believe that we have surpassed what prior recovery plans outlined as necessary to reclassify the American crocodile: The nesting range has expanded on both the east and west coasts of the State; crocodiles are frequently being seen throughout most of their historical range; nesting has extended back into Biscayne Bay on Florida's east coast and now commonly occurs at the Turkey Point Nuclear Plant; nesting has been increasing for several years; and during 2003, 61 crocodile nests were discovered in south Florida. The level of protection currently afforded to the species and its habitat, as well as the status of habitat management, are outlined in the “Summary of Factors Affecting the Species” section of this proposed rule.

Section 4(a)(1) of the Act and regulations promulgated to implement the listing provisions of the Act (50 CFR part 424) set forth five criteria to be used in determining whether to add, reclassify, or remove a species from the list of threatened and endangered species. These factors and their application to the American crocodile are as follows:

The original listing proposal (40 FR 17590) identified intensive human development and subsequent loss of American crocodile habitat as a primary threat to crocodiles. Since listing, much of the nesting habitat in Florida for crocodiles remains and has been afforded some form of protection. In addition, nesting activity that was concentrated in a small portion of the historic range in northeastern Florida Bay at the time of listing now occurs on the eastern, southern, and southwestern portions of the Florida peninsula. The primary nesting areas in northern Florida Bay that were active at the time of listing in 1975 remain protected and under the management of Everglades National Park, which has consistently supported the largest number of nests and the largest population of American crocodiles in Florida. The habitat in Everglades National Park is protected and maintained for crocodiles, and ongoing hydrologic restoration efforts may improve the quality of the habitat in the Park. Park managers emphasize maintaining a high-quality natural habitat that includes natural crocodile nesting areas. Restoration of disturbed sites, hydrologic restoration, and the removal of exotic vegetation like Australian pine and Brazilian pepper have improved crocodile nesting sites, nursery habitat, and other areas frequented by crocodiles.

Since the original listing, we have acquired and protected an important nesting area for crocodiles, Crocodile Lake National Wildlife Refuge on Key Largo. The acquisition of the Crocodile Lake National Wildlife Refuge in 1980 provided protection for over 2,205 ha (5,000 acres) of crocodile nesting and nursery habitat on Key Largo. The habitat on Crocodile Lake National Wildlife Refuge is protected and managed to support the local crocodile population. All of the nesting on Key Largo occurs within Crocodile Lake National Wildlife Refuge on artificial substrates composed of spoil taken from adjacent ditches that were dredged prior to acquisition of the property. These sites and the surrounding high-quality nursery habitat consistently support five to eight successful crocodile nests each year. The artificial substrate at nesting sites on the Refuge has begun to settle, and in an effort to continue maintenance of crocodile nesting habitat, the Refuge staff recently has augmented the substrate at certain sites to bring it back to its original elevation. Nesting has been documented at both of the elevated mounds. In order for these areas to remain as nesting and nursery sites, they need to be cleared of invasive exotics. Encroachment of native and exotic plants along the levies needs to be controlled in order for them to remain suitable for nesting crocodiles and their young. In general, Crocodile Lake National Wildlife Refuge is closed to public access. Access is granted by special use permit only. Both of these sites (Crocodile Lake NWR and Everglades National Park) have already implemented programs that provide for maintenance of natural conditions that will benefit the crocodile and are in the process of preparing management plans that will formalize ongoing management actions and further protect crocodile habitat (S. Klett, Service, personal communication 2002, Skip Snow, Everglades National Park, personal communication 2002). A management plan as defined here and throughout this proposal is not regulatory. These plans are developed by the property owners, and they outline strategies and alternatives believed to be necessary to conserve important habitat and in some cases species on the property. Implementation of the plan is not mandatory, but it should be updated on a regular basis so managers and staff on site have available the latest information and guidance for crocodile management.

In addition to these two primary core sites of publicly owned active nesting habitat for crocodiles, additional nesting habitat has been created within the historic range of the crocodile, but on a site that may not have historically supported nesting. The Turkey Point Nuclear Power Plant site, owned and operated by Florida Power and Light (FPL), contains an extensive network of cooling canals (built in 1974) that appear to provide good crocodile habitat in Biscayne Bay. The site is approximately 1,214 ha (3,000 acres), and the majority is considered crocodile habitat. The number of nests at this site has risen from 1 to 2 per year between 1978 and 1980 (Gaby et al. 1985) to 10 to 15 nests per year in the late 1990s (Brandt et al. 1995, Cherkiss 1999, J. Wasilewski personal communication 2002). This property now supports the second largest breeding aggregation of American crocodiles in Florida. The Turkey Point Nuclear Power Plant site, privately owned by FPL, has developed and implemented a management plan for their property that specifically addresses crocodiles for many years. Turkey Point is also closed to access other than personnel who work at the facility. FPL personnel maintain the canals and crocodile habitat at Turkey Point, by activities like exotic vegetation control and planting of low-maintenance native vegetation. They also have supported an extensive crocodile monitoring program since 1976. Operation of the Turkey Point Nuclear Power Plant is licensed by the Nuclear Regulatory Commission through 2032, and FPL plans to continue crocodile management and monitoring while the plant is in operation (J. Wasilewski, FPL, personal communication 2003).

FPL has also developed the Everglades Mitigation Bank along the western shore of Biscayne Bay and immediately adjacent to the Turkey Point Nuclear Power Plant, which may help bolster the crocodile population in Biscayne Bay in coming years. This site is a wetlands mitigation bank, approximately 5,665 ha (14,000 acres) in size, of which about 5,050 ha (10,000 acres) is crocodile habitat. To date, crocodile nesting has not been recorded on this site (J. Wasilewski, personal communication 2002); however, habitat restoration and management actions intended to improve nesting habitat may provide three additional nesting areas, each capable of supporting multiple nests (J. Wasilewski, personal communication 2002). It is difficult to estimate in advance how many potential nesting sites will occur in these three nesting areas, but we believe that it will be roughly equivalent to the Turkey Point Nuclear Power Plant site. This area will be protected in perpetuity and may help offset any loss of the artificial habitat at Turkey Point Nuclear Power Plant if that site is modified after the current operating license expires in 2032. Even though the nesting habitat at Turkey Point has been created and all of the nesting at Crocodile Lake National Wildlife Refuge and some areas of Everglades National Park is on artificial or created substrate, crocodiles have successfully moved into and used this habitat. We believe that it is important to continue to provide protection for the artificial habitats that crocodiles opportunistically use within their current range.

Outside of these areas that now comprise the core of nesting habitat for American crocodiles in Florida, land acquisitions have also provided protection to many other areas of potential habitat for crocodiles. A total of 44 different public properties, owned and managed by Federal, State, or county governments, as well as 2 different privately owned properties managed at least partially or wholly for conservation purposes, contain potential habitat for crocodiles in Florida. A total of 35 of the publicly-owned or private conservation lands operate under current management plans (e.g., Florida Department of Natural Resources 1991). All of the plans prescribe management actions that will provide conditions beneficial for crocodiles and maintain or improve crocodile habitat and potential nesting sites. A common action called for in many of the plans is exotic vegetation control. Sites including Rookery Bay National Estuarine Research Reserve, Collier-Seminole State Park, and others list goals to restore the natural freshwater flow patterns through hydrological restoration (e.g., Florida Department of Environmental Protection 2000). The 44 other public properties contain about 28,330 ha (70,000 acres) of potential crocodile habitat, whereas together Everglades National Park and Crocodile Lake National Wildlife Refuge contain alone about 131,120 ha (324,000 acres). A total of approximately 166,000 ha (410,000 acres) of mangrove-dominated vegetation communities are currently present in south Florida on public and private lands that are managed at least partially for conservation purposes. Approximately 10,117 ha (25,000 acres) of mangrove habitat occurs in south Florida outside of public or privately-owned conservation lands. Only a small fraction (< 5 percent) of known nests currently occur on unprotected sites (F. Mazzotti, personal communication 2001), and these sites are probably less secure than sites on properties under public ownership.

Construction and development within coastal areas continues to grow, and still poses a threat to remaining crocodile habitat that is not protected. However, each year only a few nests may occur on privately-owned, unprotected sites (F. Mazzotti, personal communication 2001). With virtually all known crocodile habitat under protection for conservation purposes, the total Florida crocodile population now believed to be estimated between 500 and 1,000 individuals (not including hatchlings), the expansion of the crocodile's nesting range to both the east and west coast of Florida, and with crocodiles frequently being seen throughout most of their historical range, we believe that the amount and quality of crocodile habitat in south Florida will continue to be maintained or enhanced sufficiently in order to provide protection for all life stages of the existing crocodile population. We also believe that available habitat can support population growth and expansion.

Prior to listing in 1975, crocodiles were frequently collected for museums and zoos, and at least occasionally shot for sport. Though it is difficult to estimate the magnitude of collection and sport hunting, several lines of evidence suggest that they may have significantly impacted the Florida population prior to listing. Moore (1953) reported on a collector who advertised that he would pay for any live crocodiles anywhere in south Florida; these were added to his collection at a zoological garden. This collector claimed to have the largest collection of American crocodiles in the United States. Shooting for sport was also common, as was both incidental and intentional killing by fishermen in Florida Bay (Moore 1953). At the time of listing in 1975, our final rule stated that poaching for skins and eggs still sometimes occurred and crocodiles were occasionally shot for sport from passing boats. Ogden (1978) reported that half of the human-caused crocodile deaths recorded between 1971 and 1975 resulted from shooting.

Since listing in 1975, collection of wild American crocodiles has ceased, and few shootings have been reported (Kushlan 1988, Moler 1991a, P. Moler personal communication 2001). Kushlan (1988) reported that only 3 of 13 human-caused mortalities between 1975 and 1984 resulted from shooting (approximately 23 percent). Moler (1991a) reported 27 recorded human-caused mortalities from 1980 to 1991. During this period, only one shooting was reported (approximately 4 percent of human-caused mortalities). Since 1991, no crocodile mortalities resulting from shooting have been recorded. This declining trend in the number of recorded shootings suggests reduced risk to crocodiles from this threat. The few legal cases involving take of crocodiles in south Florida have been publicized and may have deterred poaching and killing of crocodiles. Stories in newspapers and other popular press, as well as radio and television reports and documentaries, have aided in informing residents and visitors about the status and legal protection of American crocodiles.

We receive no to few requests for recovery permits during a given year for commercial or scientific purposes related to the crocodile in Florida. We have no reason to believe that trade or any other type of current or future utilization pose a risk to the American crocodile population in Florida.

Depredation of American crocodile nests by raccoons was cited in the original listing of crocodiles as a threat to the population. However, predation on nests by raccoons at Turkey Point Nuclear Power Plant or Crocodile Lake NWR has not been observed (F. Mazzotti, personal communication 2004). Predation on nests has been caused by fire ants in Everglades National Park (one nest) and Turkey Point Nuclear Power Plant (several nests) (F. Mazzotti, personal communication 2004). Monitoring of nest sites throughout the range of the crocodile in Florida has shown that depredation is not a major cause of nest loss. On average, 20.1 percent (range 2.8 to 45.0 percent) of nest failures resulted from depredation (Kushlan and Mazzotti 1989b, Mazzotti 1989, Moler 1991b, Mazzotti et al. 2000, Mazzotti and Cherkiss 2001).

Predation on nests in Everglades National Park has been variable with an increasing trend that has not been tested for statistical significance (F. Mazzotti, personal communication 2004). For example, the majority of nests near Little Madeira Bay, within Everglades National Park, have been depredated by raccoons in recent years (Mazzotti and Cherkiss 2001). While a few years ago, most of the predation in Everglades National Park was on nests in artificial substrates, now most of the predation is on nests at beach nest sites which are historically the most productive in Everglades National Park (F. Mazzotti, personal communication 2004). This is of concern as these are the only nests on natural habitat left in the U.S. Nest depredation may become an increasing problem as the density of crocodile nests increases, allowing for raccoons and other nest predators to become specialized in locating nests (Mazzotti 1999). However, localized efforts to control raccoons may boost productivity rates in areas where raccoon depredation has become problematic.

There is no evidence of disease in the American crocodile population in Florida. Therefore, disease does not present a known threat to the crocodile in Florida.

The Act currently provides protection for the American crocodile as an endangered species, and these protections would not be significantly reduced if it were reclassified to threatened. A more complete discussion of applicable Federal regulations is included below (see “Available Conservation Measures” section). In addition to the Federal regulations described below, the National Park Service has established regulations for general wildlife protection in units of the National Park System that prohibit the taking of wildlife; the feeding, touching, teasing, frightening or intentional disturbing of wildlife nesting, breeding, or other activities; and possessing unlawfully taken wildlife or portions thereof (36 CFR 2.2).

The State of Florida provides legal protection for the American crocodile within the State. In 1967, the State of Florida listed the crocodile as “protected.” This status was revised in 1972, when the American crocodile was listed as “endangered” under Chapter 68A-27 of the Florida Wildlife Code. Chapter 68A-27.003 of the Florida Code, entitled ADesignation of endangered species; prohibitions; permits' specifies that Ano person shall pursue, molest, harm, harass, capture, possess, or sell” any of the endangered species that are listed. Violation of these prohibited acts can be considered a third degree felony, and is punishable by up to 5 years in prison and a $10,000 fine (Florida Statute 372.0725). At this time, the FWC has no immediate plans to change the American crocodile's status, regardless of whether or not the Service reclassifies the species to threatened (P. Moler, FWC, personal communication 2004). The FWC also currently operates under a cooperative agreement with us under section 6 of the Act that formalizes a cooperative approach to the development and implementation of programs and projects for the conservation of threatened and endangered species.

On June 28, 1979, the American crocodile was added to Appendix II of CITES. This designation reflected that the species, while not currently threatened with extinction, may become so without trade controls. On June 6, 1981, the American crocodile was moved to Appendix I, indicating that it was considered to be threatened with extinction. Generally, no commercial trade is allowed for Appendix I species. CITES is a treaty established to monitor international trade to prevent further decline in wild populations of plant or animal species. CITES permits may not be issued if import or export of the species may be detrimental to the species' survival, or if specimens are not legally acquired. CITES does not regulate take or domestic trade, so it would not apply to take within Florida or the United States. Reclassification of the American crocodile in Florida from endangered to threatened will not affect the species' CITES status.

Several other Federal regulations may provide protection for American crocodiles or their habitat. Section 404 of the Clean Water Act (33 U.S.C. 1344 et seq.) requires the issuance of a permit from the U.S. Army Corps of Engineers (Corps) for the discharge of any dredged or fill material into waters of the United States. The Corps may deny the issuance of a permit if the project might adversely affect wildlife and other natural resources. Also, sections 401 and 403 of the Rivers and Harbors Act (33 U.S.C. 304 et seq.) prohibit the construction of bridges, roads, dams, docks, weirs, or other features that would inhibit the flow of water within any navigable waterway. The Rivers and Harbors Act ensures the protection of estuarine waters from impoundment or development and indirectly protects natural flow patterns that maintain crocodile habitat. In addition, the Federal agencies responsible for ensuring compliance with the Clean Water Act and the Rivers and Harbors Act are required to consult with us if the issuance of a permit may affect endangered species or their designated critical habitat, under section 7(a)(1) of the Endangered Species Act (see “Available Conservation Measures” section below). This requirement remains the same whether a species is listed as endangered or threatened.

The Fish and Wildlife Coordination Act of 1958 (as amended), codified at 16 U.S.C. 661 et seq. requires equal consideration and coordination of wildlife conservation with other water resources development. This statute allows us and State fish and game agencies to review proposed actions and address ways to conserve wildlife and prevent loss of or damage to wildlife resources. The Fish and Wildlife Coordination Act allows us to help ensure that American crocodiles and their habitat are not degraded by water development projects and allows us to incorporate improvements to habitat whenever practicable.

As explained in the original listing (40 FR 44149), crocodile nest sites were vulnerable to disturbance from increasing human activity because of the remoteness and difficulty of patrolling nesting areas. Human disturbance of crocodiles can cause them to abandon suitable habitat or disrupt reproduction activities (i.e., females abandoning their nest sites). As the American crocodile population and the human population in south Florida both grow, the number of human-crocodile interactions has increased (Tim Regan, FWC, personal communication 2002). However, ongoing acquisition of important nesting and nursery sites and other additional crocodile habitat by Federal, State, or local governments and implementation of management plans on these publicly-owned properties have improved protection to crocodile nests.

Of the three core properties that support crocodile nesting (Everglades National Park, Crocodile Lake National Wildlife Refuge, and Turkey Point Nuclear Power Plant), only Turkey Point has a management plan in place that specifically addresses the American crocodile. This plan calls for activities like road maintenance, vehicle access, and construction to be conducted in important crocodile habitat only at certain times or locations based on the crocodile's activity in order to reduce human disturbance at Turkey Point. In addition, Turkey Point is closed to access other than personnel who work at the facility. Both Everglades National Park and Crocodile Lake National Wildlife Refuge, even without species-specific management plans, have established rules that provide protection from disturbance to benefit the crocodile. At Everglades National Park, protection from disturbance is based on guidelines for general public use, such as instructions to stay on marked trails. Crocodile Lake National Wildlife Refuge is generally closed to public access. However, personnel conduct necessary activities on the property in consideration of crocodiles to reduce disturbance. Activities conducted on or near the nesting sites are conducted during the non-breeding season in order to minimize crocodile disturbance. Both Crocodile Lake National Wildlife Refuge and Everglades National Park are preparing management plans that will formalize ongoing actions and more specifically address American crocodiles (S. Klett, personal communication 2002, Skip Snow, Everglades National Park, personal communication 2002). In addition, Everglades National Park has been preparing a draft wilderness plan that will benefit the crocodile mostly by general prescribed changes in public use in portions of the Park.

In addition to these core nesting sites, approximately 44 public properties, managed as conservation lands by Federal, State, or county governments, provide potential habitat for crocodiles in south Florida. In addition, two other privately-owned sites that are maintained as conservation lands or that conduct natural lands management provide potential crocodile habitat. A total of 35 of these 46 properties operate under current management plans. Only two specifically mention management actions intended to benefit the American crocodile. However, other actions mentioned in management plans that will reduce disturbance to crocodiles include restrictions on public use, implementation of boat speed limits (including areas of no-wake zones), and prohibition of wildlife harassment. Managing potential human'crocodile conflicts remains an important factor in providing adequate protection for and reducing disturbance to crocodiles.

The original proposed listing cites the risk of a hurricane or another natural disaster as a serious threat to the American crocodile population (40 FR 17590). Hurricanes and freezing temperatures may also kill some adult crocodiles (Moler 1991a), but their susceptibility to mortality from extreme weather is poorly documented. These events still have the potential to threaten the historically restricted nesting distribution of the American crocodile in south Florida. However, increased nesting activity in western Florida Bay, Cape Sable, and Turkey Point Nuclear Power Plant have broadened the nesting range. Nesting now occurs on the eastern, southern, and southwestern portions of the Florida peninsula. While a single storm could still easily affect all portions of the population, it is less likely now that the impact to all population segments would be severe.

The original listing rule cited the restriction of the flow of freshwater to the Everglades because of increasing human development as a potential threat to the American crocodile population in Florida. Ongoing efforts to restore the Everglades ecosystem and restore a more natural hydropattern to south Florida will affect the amount of freshwater entering the estuarine systems. Because growth rates of hatchling crocodiles are closely tied to the salinity in the estuaries, restoration efforts will affect both quality and availability of suitable nursery habitat. Decreased salinity should increase growth rates and survival among hatchling crocodiles. Proposed restoration activities in and around Taylor Slough and the C-111 canal are projected to increase the amount of fresh water entering the estuarine system, and extend the duration of freshwater flow into Florida Bay (T. Dean, H. McSarry, P. Pitts, Service, personal communication 2004). The addition of fresh water will also occur throughout many of the tributaries and small natural drainages along the shore of Florida Bay, instead of primarily from the mouth of the C-111 canal (T. Dean, H. McSarry, P. Pitts, Service, personal communication 2004). Salinities in nesting areas, including Joe, Little Madeira, and Terrapin Bays, are projected to be lower for longer periods than they currently are within this area (based on alternative D13R hydrologic plan simulation—U.S. Army Corps of Engineers and South Florida Water Management District 1999). This restoration project should increase the amount and suitability of crocodile habitat in northern Florida Bay, and increase juvenile growth rates and survival (Mazzotti and Brandt 1995).

Hydrological restoration may also affect crocodile habitat in Biscayne Bay. Reductions in freshwater discharge will occur in the Miami River, Snake Creek, and central and south Biscayne Bay (H. McSharry, Service, personal communication 2004). These projected changes would appear to reduce habitat quality in a portion of Biscayne Bay. Consequently, the effect of the proposed hydrological modifications on the crocodile population in Biscayne Bay is likely negative. However, over the entire range of crocodile habitat that will be affected by Everglades restoration, we expect a benefit to the species.

Mortality of crocodiles on south Florida roads has consistently been the primary source of adult mortality, and this trend has not changed (Mazzotti and Cherkiss 2003). Road kills have occurred throughout the crocodile's range in Florida, but most have occurred on Key Largo and around Florida Bay, especially around Card and Barnes Sounds (Mazzotti and Cherkiss 2003). Many of the recorded crocodile road kills are of adults, which may result from the increased likelihood of large individuals being reported. We cannot accurately estimate the proportion of road-killed crocodiles that are reported. Therefore, it is difficult to accurately estimate the magnitude of this source of mortality or its effect on the population. However, all segments of the crocodile population in Florida have continued to grow despite this continuing mortality factor. Signs cautioning drivers of the risk of colliding with crocodiles have been posted along the major highways throughout crocodile habitat in south Florida. As discussed above, measures that have been identified to help reduce road kill mortality include installing fencing in appropriate places to prevent crocodiles from entering roadways and installation of box culverts under roadways so that crocodiles can safely cross roads.

As the MSRP details, the success of American crocodile nesting is largely dependent on the maintenance of suitable egg cavity moisture throughout incubation, and flooding may also affect nest success. On Key Largo and other islands, failure of crocodile nests is typically attributed to desiccation due to low rainfall (Moler 1991b). Data compiled by Mazzotti and Cherkiss (2003) document an average of 47.5 percent nest success from 1978 through 1999 (excluding 1991 and 1992 due to lack of data) at Crocodile Lake NWR on north Key Largo. Nest failures on the mainland may be associated with flooding or desiccation (Mazzotti et al. 1988, Mazzotti 1989). In certain areas, flooding and over-drying affect nest success. Data compiled by Mazzotti and Cherkiss (2003) document an average of 64.4 percent nest success from 1970 through 1999 at Everglades National Park (excluding 1975, 1976, 1983, 1984, and 1996 due to lack of data) and 98 percent nest success from 1978 through 1999 at Turkey Point Nuclear Power Plant (excluding 1980 and 1982 due to lack of data). However, overall, the crocodile population in Florida has more than doubled its size since it was listed to an estimated 500 to 1,000 individuals and appears to be compensating for these potential threats.

The final rule listing crocodiles did not reference contaminants as a potential threat. However, several studies have shown that contaminants occur in American crocodiles in south Florida (Hall et al. 1979, Stoneburger and Kushlan 1984, Mazzotti unpublished data). Though we have no evidence that contaminants have affected the crocodile population, we recognize that contaminants have been documented in crocodile eggs. Contaminants such as pesticides and heavy metals may pose a threat to crocodiles in south Florida at some levels, but we have not yet detected them at the population level. A variety of organochlorine pesticide residues (DDT, DDE, and Dieldrin, among others), and PCBs have been documented in crocodile eggs collected from south Florida (Hall et al. 1979). Acute exposure to pesticides and heavy metals may result in death, while prolonged exposure to lower concentrations of organochlorines include liver damage, reproductive failure, behavioral abnormalities, or deformities. Despite the fact that contaminants have been documented in crocodile eggs in south Florida, the crocodile population and nesting are increasing. Little information is known at this time about what constitutes dangerous levels of these contaminants in crocodiles or other crocodilians.

We have carefully assessed the best scientific and commercial information available regarding the past, present, and future threats faced by the American crocodile in Florida in determining this proposed rule. Based on this evaluation, we have determined that the American crocodile in its range in Florida meets the criteria of a DPS as stated in our policy of February 17, 1996 (61 FR 4722), and in regard to its status, the preferred action is to reclassify the American crocodile in the Florida DPS from an endangered species to a threatened species. The recovery plan for the crocodile states that, “Based on the fact that the population appears stable, and that all of the threats as described in the original listing have been eliminated or reduced, reclassification of the crocodile will be possible, provided existing levels of protection continue to be afforded to crocodiles and their habitat, and that management efforts continue to maintain or enhance the amount and quality of available habitats necessary for all life stages.” We believe based on our evaluation that the criteria for downlisting the American crocodile in the Florida DPS have been met because:

(1) The amount and quality of crocodile habitat in Florida will continue to be maintained or enhanced sufficiently in order to provide protection for all life stages of the existing crocodile population and available habitat can support population growth and expansion; and

(2) Acquisition of important nesting and nursery sites and other additional crocodile habitat by Federal, State, or local governments and implementation of management on these publicly-owned properties have improved protection to crocodiles and crocodile nests.

Two of the three primary nesting areas for American crocodiles in Florida occur on Federal conservation lands and are consequently afforded protection from development and large-scale habitat disturbance. Crocodiles also occur on a variety of State-owned properties, and existing State and Federal regulations provide protection on these sites. The fact that American crocodile habitat is primarily wetlands also assures the opportunity for conference or consultation on most projects that occur in crocodile habitat under the authorities described below.

Conservation measures provided to species listed as endangered or threatened under the Act include recognition, recovery actions, requirements for Federal protection, and prohibitions against certain practices. Recognition through listing increases public awareness of threats to the American crocodile, and promotes conservation actions by Federal, State, and local agencies, private organizations, and individuals. The Act provides for possible land acquisition and cooperation with the State, and requires that recovery actions be carried out. The protection required of Federal agencies and the prohibitions against taking and harm are discussed, in part below.

Section 7(a) of the Act, as amended, requires Federal agencies to evaluate their actions with respect to the American crocodile and its designated critical habitat (41 FR 41914). Regulations implementing this interagency cooperation provision of the Act are codified at 50 CFR part 402. If a Federal action may affect the American crocodile or its designated critical habitat, the responsible Federal agency must enter into formal consultation with us. Federal agency actions that may require consultation with us include Corps of Engineers involvement in projects such as residential development that requires dredge/fill permits, the construction of roads and bridges, and dredging projects. Power plant development and operation under license from the Federal Energy Regulatory Commission/Nuclear Regulatory Commission may also require consultation with respect to licensing and re-licensing.

The Act and its implementing regulations set forth a series of general prohibitions and exceptions that apply to all threatened wildlife. The prohibitions, codified at 50 CFR 17.21 and 50 CFR 17.31, in part, make it illegal for any person subject to the jurisdiction of the United States to take (includes harass, harm, and pursue, hunt, shoot, wound, kill, trap, capture, or collect; or to attempt any of these), import or export, ship in interstate commerce in the course of commercial activity, or sell or offer for sale in interstate or foreign commerce any listed species. It is also illegal to possess, sell, deliver, carry, transport, or ship any such wildlife that has been taken illegally. Certain exceptions apply to our agents and agents of State conservation agencies.

We may issue permits to carry out otherwise prohibited activities involving threatened wildlife under certain circumstances. Regulations governing permits are codified at 50 CFR 17.32. Such permits are available for scientific purposes, to enhance the propagation or survival of the species, and/or for incidental take in the course of otherwise lawful activities. For threatened species, permits also are available for zoological exhibition, educational purposes, or special purposes consistent with the purposes of the Act.

Questions regarding whether specific activities will constitute a violation of section 9 should be directed to Cindy Schulz of the South Florida Ecological Services Office (see ADDRESSES section). Requests for copies of the regulations regarding listed species and inquiries about prohibitions and permits may be addressed to the U.S. Fish and Wildlife Service, Ecological Services Division, 1875 Century Boulevard, Suite 200, Atlanta, Georgia 30345 (telephone 404/679-4176, facsimile 404/679-7081).

This proposed rule recommends a change in status of the American crocodile at 50 CFR 17.11, from endangered to threatened. If made final, this rule would formally recognize that this species is no longer in imminent danger of extinction throughout all or a significant portion of its range in Florida. However, this reclassification would not significantly change the protection afforded this species under the Act. Anyone taking, attempting to take, or otherwise possessing an American crocodile, or parts thereof, in violation of section 9 would still be subject to a penalty under section 11 of the Act. Section 7 of the Act would still continue to protect the American crocodile from Federal actions that might jeopardize its continued existence or destroy or adversely modify its critical habitat.

If the crocodile is listed as threatened, recovery actions directed at the crocodile would continue to be implemented as outlined in the MSRP. The MSRP identifies actions that will result in the recovery of the American crocodile, including—(1) Determining the current distribution and abundance; (2) protecting and enhancing existing crocodile colonies; (3) conducting research on the American crocodile's biology and life history; (4) monitoring the south Florida crocodile population; and (5) informing the public about the recovery needs of crocodiles. The MSRP also outlines restoration activities that should be undertaken to adequately restore the mangrove community that the crocodile occupies. These actions include—(1) Protecting crocodile nesting, basking, and nursery habitat; (2) managing and restoring suitable crocodile habitat; (3) conducting research on the habitat relationships of the crocodile; (4) continuing to monitor crocodile habitat; and (5) increasing public awareness of the habitat needs of the crocodile.

Finalization of this proposed rule would not constitute an irreversible commitment on our part. Reclassification of the American crocodile in Florida to endangered status would be possible if changes occur in management, population status, and habitat or other actions detrimentally affect the population or increase threats to its survival.

In accordance with our policy published on July 1, 1994 (59 FR 34270), we will seek the expert opinions of at least three appropriate and independent specialists regarding this proposed rule. The purpose of this review is to ensure that listing decisions are based on scientifically sound data, assumptions, and analyses. We will send these peer reviewers copies of this proposed rule immediately following publication in the Federal Register. We will invite these peer reviewers to comment, during the comment period, on the specific assumptions and conclusions regarding the proposed reclassification of the American crocodile in Florida.

The final decision on this proposed rule will take into consideration the comments and any additional information we receive, and such communications may lead to a final regulation that differs from this proposal.

The Act provides for one or more public hearings on this proposal, if requested. We must receive requests within 45 days of the date of publication of the proposal in the Federal Register. Such requests must be made in writing and be sent to the South Florida Ecological Services Office, 1339 20th Street, Vero Beach, FL 32960.

Executive Order 12866 requires agencies to write regulations that are easy to understand. We invite your comments on how to make this rule easier to understand including answers to the following: (1) Is the discussion in the SUPPLEMENTARY INFORMATION section of the preamble helpful in understanding the proposal?; (2) does the proposal contain technical language or jargon that interferes with its clarity?; (3) does the format of the proposal (grouping and order of sections, use of headings, etc.) aid or reduce its clarity; and (4) what else could we do to make the rule easier to understand?

Send a copy of any comments that concern how we could make this proposed rule easier to understand to the Office of Regulatory Affairs, Department of the Interior, Room 7229, 1849 C St., NW., Washington, DC 20240.

This rule does not contain any new collections of information for which Office of Management and Budget Approval is required under the Paperwork Reduction Act. An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information, unless it displays a currently valid control number. For additional information concerning permit and associated requirements for threatened species, see 50 CFR 17.72.

We have determined that an Environmental Assessment, as defined under the authority of the National Environmental Policy Act of 1969, need not be prepared in connection with regulations adopted pursuant to section 4(a) of the Endangered Species Act of 1973, as amended. We published a notice outlining our reasons for this determination in the Federal Register on October 25, 1983 (48 FR 49244).

A complete list of all references cited in this document, as well as others, is available upon request from the South Florida Ecological Services Office (see ADDRESSES section).

The primary author of this document is Tylan Dean, Fish and Wildlife Biologist (see ADDRESSES section).

We propose to amend part 17, subchapter B of chapter I, title 50 of the Code of Federal Regulations, as follows:

The Magnuson-Stevens Act requires that each regional fishery management council submit any FMP amendment it prepares to NMFS for review and approval, disapproval, or partial approval by the Secretary. The Magnuson-Stevens Act also requires that NMFS, upon receiving an FMP amendment, immediately publish a notice in the Federal Register announcing that the amendment is available for public review and comment.

Beginning in 2001, NMFS required a Federal scallop LLP license on board any vessel deployed in the scallop fisheries in Federal waters off Alaska. The LLP was implemented through approval of Amendment 4 to the FMP by the Secretary on June 8, 2000, and the final rule implementing Amendment 4 was published December 14, 2000 (65 FR 78110). The LLP was established to limit harvesting capacity in the Federal scallop fishery off Alaska. NMFS issued a total of nine LLP licenses. Licenses were issued to holders of either Federal or state moratorium permits who used their moratorium permits to make legal landings of scallops in each of any two calendar years during the period beginning January 1, 1996, through October 9, 1998. The licenses authorize their holders to catch and retain scallops in all waters off Alaska that are open for scallop fishing.

Licenses based on the legal landings of scallops harvested only from Cook Inlet (State Registration Area H) during the qualifying period have a gear restriction endorsement that limited allowable gear to a single 6-foot (1.8 m) dredge when fishing for scallops in any area. NMFS issued two licenses with this gear endorsement. The purpose of this gear restriction was to prevent expansion in overall fishing capacity by not allowing relatively small operations in Cook Inlet to increase their fishing capacity. The other seven licenses, based on the legal landings of scallops harvested from other areas outside Cook Inlet during the qualifying period, have no gear endorsement, but are limited to two 15-foot (4.5 m) dredges under existing state regulations.

Since the LLP was implemented, the Council found that the gear restriction endorsement may create a disproportionate economic hardship for those two LLP license holders with the endorsement when they fish in Federal waters, especially in light of the state's observer requirements and their associated costs. In February 2004, the Council developed a problem statement and four alternatives for analysis of modifying or eliminating the gear restriction for the two licenses affected by the gear restriction.

In October 2004, the Council voted unanimously to recommend Amendment 10 to change the single 6-foot (1.8 m) dredge restriction endorsement to a gear restriction endorsement of two dredges with a combined width of no more that 20-foot (6.096 m). This change would allow the two LLP license holders with the current gear endorsement to fish in Federal waters outside Cook Inlet with larger dredges. The Council recommended this change because it found that it is not economically viable for vessels to operate outside Cook Inlet with the existing gear restrictions. The Council also concluded that, because of changes to the fleet after the LLP was implemented due to the formation of a voluntary fishing cooperative, these two vessels could increase their capacity and enhance economic viability in statewide waters outside Cook Inlet without increasing overall fishing effort to the extent that it would jeopardize the total fleet's ability to operate at a sustainable and economically viable level. Amendment 10 would provide the two vessels with a larger share of the total catch that could better offset their observer costs and enhance their economic viability.

An EA/RIR/IRFA was prepared for Amendment 10 that describes the management background, the purpose and need for action, the management alternatives, and the environmental and socio-economic impacts of the alternatives (see ADDRESSES).

Written public comments are being solicited on proposed Amendment 10 through the end of the comment period stated (see DATES). All comments received by the end of the comment period on the amendment will be considered in the approval/disapproval decision. Comments received after that date will not be considered in the approval/disapproval decision on the amendment. To be considered, comments must be received not just postmarked or otherwise transmitted by the close of business on the last day of the comment period. NMFS will soon publish the proposed regulations to implement Amendment 10.