This action is not subject to the provisions of Executive Order 12866 since it involves only internal Agency management. This action is not published for prior notice and comment under the Administrative Procedure Act since it involves only internal Agency management and publication for comment is unnecessary and contrary to the public interest.

The Catalog of Federal Domestic Assistance programs impacted by this action are as follows:

Programs with Catalog of Federal Domestic Assistance numbers 10.405, 10.415, 10.433, and 10.766 are subject to the provisions of Executive Order 12372 which requires intergovernmental consultation with State and local officials.

This final rule has been reviewed under Executive Order 12988, Civil Justice Reform. In accordance with this rule: (1) Unless otherwise specifically provided, all State and local laws and regulations that are in conflict with this rule will be preempted; (2) no retroactive effect will be given to this rule except as specifically prescribed in the rule; and (3) administrative proceedings of the National Appeals Division (7 CFR part 11) must be exhausted before litigation against the Department is instituted.

There are no new reporting and recordkeeping requirements associated with this rule.

Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Pub. L. 104-4, establishes requirements for Federal agencies to assess the effects of their regulatory actions on State, local, and tribal governments and the private sector. Under section 202 of the UMRA, the Agencies generally must prepare a written statement, including a cost-benefit analysis, for proposed and final rules with “Federal mandates” that may result in expenditures to State, local, or tribal governments, in the aggregate, or to the private sector, of $100 million or more in any 1 year. When such a statement is needed for a rule, section 205 of the UMRA generally requires the agencies to identify and consider a reasonable number of regulatory alternatives and adopt the least costly, more cost-effective, or least burdensome alternative that achieves the objectives of the rule.

This rule contains no Federal mandates (under the regulatory provisions of title II of the UMRA) for State, local, and tribal governments or the private sector. Thus, the rule is not subject to the requirements of section 202 and 205 of the UMRA.

This document has been reviewed in accordance with 7 CFR part 1940, Subpart G, “Environmental Program.” The Agencies have determined that this final action does not constitute a major Federal action significantly affecting the quality of human environment, and in accordance with the National Environmental Policy Act of 1969, 42 U.S.C. 4321 et seq., an Environmental Impact Statement is not required.

The policies contained in this rule do not have any substantial direct effect on 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. Nor does this rule impose substantial direct compliance costs on State and local governments. Therefore, consultation with the States is not required.

These subparts are being revised to conform with changes made to 7 CFR 2018, subpart D, to include information concerning implementation of electronic funds transfer.

The FAA has determined that notice and opportunity for prior public comment hereon are impracticable because these procedures would significantly delay issuance of approval and thus delivery of the affected aircraft. In addition, the substance of these special conditions has been subject to the public comment process in several prior instances with no substantive comments received. The FAA, therefore, finds that good cause exists for making these special conditions effective upon issuance.

Interested persons are invited to submit such written data, views, or arguments, as they may desire. Communications should identify the regulatory docket or notice number and be submitted in duplicate to the address specified above. All communications received on or before the closing date for comments will be considered by the Administrator. The special conditions may be changed in light of the comments received. All comments received will be available in the Rules Docket for examination by interested persons, both before and after the closing date for comments. A report summarizing each substantive public contact with FAA personnel concerning this rulemaking will be filed in the docket. Commenters wishing the FAA to acknowledge receipt of their comments submitted in response to this notice must include a self-addressed, stamped postcard on which the following statement is made: “Comments to Docket No. CE220.” The postcard will be date stamped and returned to the commenter.

In 2001 and 2002, The Lancair Company, 22550 Nelson Road, Bend, Oregon 97701, made applications to the FAA for a Type Design Change for the Lancair LC41-550FG and LC42-550FG airplanes. The modification incorporated an existing Supplemental Type Certificate (STC) into the Type Design as optional equipment on the LC41-550FG and LC42-550FG. These models are currently approved under Type Certificate Data Sheet (TCDS) No. A00003SE. The proposed modification incorporates a novel or unusual design feature, such as digital avionics consisting of an EFIS, that is vulnerable to HIRF external to the airplane.

Under the provisions of 14 CFR part 21, § 21.101, The Lancair Company must show that the LC41-550FG and LC42-550FG aircraft meet the following provisions, or the applicable regulations in effect on the date of application for the change to the two models.

For the LC41-550FG: Part 23 of the Federal Aviation Regulations (FAR) effective February 1, 1965, as amended by 23-1 through 23-46, except for FAR 23.1305 and FAR 23.1359. FAR 23.1305 as amended through 23-52 and FAR 23.1359 as amended through 23-49. FAR 36 as amended on the date of certification. Application for type certificate dated October 24, 2002. Equivalent Level of Safety (ELOS) Findings for Emergency exit requirements of FAR 23.807 in accordance with ELOS No. ACE-99-02, as detailed in FAA memo dated February 2, 1999 (FAA memo reference no. 99-190S-64), and the terms of these Special Conditions.

For the LC42-550FG: Part 23 of the Federal Aviation Regulations (FAR) effective February 1, 1965, as amended by 23-1 through 23-46, except for FAR 23.1305 and FAR 23.1359. FAR 23.1305 as amended through 23-52 and FAR 23.1359 as amended through 23-49. FAR 36 as amended on the date of certification. Applicable Equivalent Level of Safety (ELOS) Findings: Stall and spin requirements of FAR's 23.201, 23.203, and 23.221 in accordance with ELOS No. ACE-98-1, as detailed in the FAA memo dated September 3, 1998 (FAA memo reference no. 98-190S-581) and ELOS No. ACE-98-2 as detailed in the FAA memo dated October 7, 1998 (FAA memo reference no. 98-190S-608). Emergency exit requirements of FAR 23.807 in accordance with ELOS No. ACE-99-02 as detailed in FAA memo dated February 2, 1999 (FAA memo reference no. 99-190S-64), and the terms of these Special Conditions.

If the Administrator finds that the applicable airworthiness standards do not contain adequate or appropriate safety standards because of novel or unusual design features of an airplane, special conditions are prescribed under the provisions of § 21.16.

Special conditions, as appropriate, as defined in § 11.19, are issued in accordance with § 11.38 after public notice and become part of the type certification basis in accordance with § 21.101.

Special conditions are initially applicable to the model for which they are issued. Should the applicant apply to modify any other model already included on the same Type Data Sheet to incorporate the same novel or unusual design feature, the special conditions would also apply to the other model under the provisions of § 21.101.

The Lancair Company plans to incorporate certain novel and unusual design features into an airplane for which the airworthiness standards do not contain adequate or appropriate safety standards for protection from the effects of HIRF. These features include EFIS, which are susceptible to the HIRF environment, that were not envisaged by the existing regulations for this type of airplane.

Recent advances in technology have given rise to the application in aircraft designs of advanced electrical and electronic systems that perform functions required for continued safe flight and landing. Due to the use of sensitive solid state advanced components in analog and digital electronics circuits, these advanced systems are readily responsive to the transient effects of induced electrical current and voltage caused by the HIRF. The HIRF can degrade electronic systems performance by damaging components or upsetting system functions.

Furthermore, the HIRF environment has undergone a transformation that was not foreseen when the current requirements were developed. Higher energy levels are radiated from transmitters that are used for radar, radio, and television. Also, the number of transmitters has increased significantly. There is also uncertainty concerning the effectiveness of airframe shielding for HIRF. Furthermore, coupling to cockpit-installed equipment through the cockpit window apertures is undefined.

The combined effect of the technological advances in airplane design and the changing environment has resulted in an increased level of vulnerability of electrical and electronic systems required for the continued safe flight and landing of the airplane. Effective measures against the effects of exposure to HIRF must be provided by the design and installation of these systems. The accepted maximum energy levels in which civilian airplane system installations must be capable of operating safely are based on surveys and analysis of existing radio frequency emitters. These special conditions require that the airplane be evaluated under these energy levels for the protection of the electronic system and its associated wiring harness. These external threat levels, which are lower than previous required values, are believed to represent the worst case to which an airplane would be exposed in the operating environment.

These special conditions require qualification of systems that perform critical functions, as installed in aircraft, to the defined HIRF environment in paragraph 1 or, as an option to a fixed value using laboratory tests, in paragraph 2, as follows:

(1) The applicant may demonstrate that the operation and operational capability of the installed electrical and electronic systems that perform critical functions are not adversely affected when the aircraft is exposed to the HIRF environment defined below:

(2) The applicant may demonstrate by a system test and analysis that the electrical and electronic systems that perform critical functions can withstand a minimum threat of 100 volts per meter, electrical field strength, from 10 kHz to 18 GHz. When using this test to show compliance with the HIRF requirements, no credit is given for signal attenuation due to installation.

A preliminary hazard analysis must be performed by the applicant, for approval by the FAA, to identify either electrical or electronic systems that perform critical functions. The term “critical” means those functions whose failure would contribute to, or cause, a failure condition that would prevent the continued safe flight and landing of the airplane. The systems identified by the hazard analysis that perform critical functions are candidates for the application of HIRF requirements. A system may perform both critical and non-critical functions. Primary electronic flight display systems, and their associated components, perform critical functions such as attitude, altitude, and airspeed indication. The HIRF requirements apply only to critical functions.

Compliance with HIRF requirements may be demonstrated by tests, analysis, models, similarity with existing systems, or any combination of these. Service experience alone is not acceptable since normal flight operations may not include an exposure to the HIRF environment. Reliance on a system with similar design features for redundancy as a means of protection against the effects of external HIRF is generally insufficient since all elements of a redundant system are likely to be exposed to the fields concurrently.

As discussed above, these special conditions are applicable to the Lancair Company Model LC41-550FG and LC42-550FG airplanes. Should the Lancair Company apply at a later date for a type design change to modify any other model on the same type certificate to incorporate the same novel or unusual design feature, the special conditions would apply to that model as well under the provisions of § 21.101.

This action affects only certain novel or unusual design features being proposed for the model(s) discussed in this special condition. It is not a rule of general applicability and affects only the applicant who applied to the FAA for approval of these features on the airplane.

The substance of these special conditions has been subjected to the notice and comment period in several prior instances and has been derived without substantive change from those previously issued. It is unlikely that prior public comment would result in a significant change from the substance contained herein. For this reason, and because a delay would significantly affect the certification of the airplane, which is imminent, the FAA has determined that prior public notice and comment are unnecessary and impracticable, and good cause exists for adopting these special conditions upon issuance. The FAA is requesting comments to allow interested persons to submit views that may not have been submitted in response to the prior opportunities for comment described above.

The FAA has determined that notice and opportunity for prior public comment hereon are impracticable because these procedures would significantly delay issuance of the approval and thus delivery of the affected aircraft. In addition, the substance of these special conditions has been subject to the public comment process in several prior instances with no substantive comments received. The FAA, therefore, finds that good cause exists for making these special conditions effective upon issuance.

Interested persons are invited to submit such written data, views, or arguments, as they may desire. Communications should identify the regulatory docket or notice number and be submitted in duplicate to the address specified above. All communications received on or before the closing date for comments will be considered by the Administrator. The special conditions may be changed in light of the comments received. All comments received will be available in the Rules Docket for examination by interested persons, both before and after the closing date for comments. A report summarizing each substantive public contact with FAA personnel concerning this rulemaking will be filed in the docket. Commenters wishing the FAA to acknowledge receipt of their comments submitted in response to this notice must include a self-addressed, stamped postcard on which the following statement is made: “Comments to Docket No. CE221.” The postcard will be date stamped and returned to the commenter.

On April 5, 2004, Twin Commander Aircraft LLC. 19010 59th DR NE. Arlington, WA. 98223, made application to the FAA for a new Supplemental Type Certificate for the Twin Commander Aircraft Models 690C, 690D, 695, 695A, and 695B. The Twin Commander Aircraft Models of concern are approved under TCDS No. 2A4. The proposed modification incorporates a novel or unusual design feature, a digital air data computer, which may be vulnerable to HIRF external to the airplane.

Under the provisions of 14 CFR part 21, § 21.101, Twin Commander Aircraft LLC. must show that the Twin Commander Aircraft Models 690C, 690D, 695, 695A, and 695B meet the following provisions, or the applicable regulations in effect on the date of application for the change. For those areas modified or impacted by the installation of the IS&S ADDU (Air Data Display Unit) system, the following paragraphs as amended by Amendments 23-1 through 23-54 must be complied with: 23.305, 23.307, 23.365, 23.603, 23.609, 23.611, 23.613, 23.625, 23.627, 23.771, 23.773, 23.777, 23.1301, 23.1303, 23.1309, 23.1311, 23.1321, 23.1322, 23.1331, 23.1335, 23.1351, 23.1357, 23.1359, 23.1361, 23.1365, 23.1367, 23.1381, 23.1431, 23.1529, 23.1541, 23.1543, 23.1581 and the special conditions adopted by this rulemaking action. For systems that are not modified or impacted by the installation, the original certification basis listed on TCDS No. 2A4 are still applicable.

If the Administrator finds that the applicable airworthiness standards do not contain adequate or appropriate safety standards because of novel or unusual design features of an airplane, special conditions are prescribed under the provisions of § 21.16.

Special conditions, as appropriate, as defined in § 11.19, are issued in accordance with § 11.38 after public notice and become part of the type certification basis in accordance with § 21.101.

Special conditions are initially applicable to the models for which they are issued. Should the applicant apply for a supplemental type certificate to modify any other model already included on the same type certificate to incorporate the same novel or unusual design feature, the special conditions would also apply to the other model under the provisions of § 21.101.

Twin Commander Aircraft LLC. plans to incorporate certain novel and unusual design features into an airplane for which the airworthiness standards do not contain adequate or appropriate safety standards for protection from the effects of HIRF. These features include the addition of a digital Air Data computer, which may be susceptible to the HIRF environment, that were not envisaged by the existing regulations for this type of airplane.

Recent advances in technology have given rise to the application in aircraft designs of advanced electrical and electronic systems that perform functions required for continued safe flight and landing. Due to the use of sensitive solid-state advanced components in analog and digital electronics circuits, these advanced systems are readily responsive to the transient effects of induced electrical current and voltage caused by the HIRF. The HIRF can degrade electronic systems performance by damaging components or upsetting system functions.

Furthermore, the HIRF environment has undergone a transformation that was not foreseen when the current requirements were developed. Higher energy levels are radiated from transmitters that are used for radar, radio, and television. Also, the number of transmitters has increased significantly. There is also uncertainty concerning the effectiveness of airframe shielding for HIRF. Furthermore, coupling to cockpit-installed equipment through the cockpit window apertures is undefined.

The combined effect of the technological advances in airplane design and the changing environment has resulted in an increased level of vulnerability of electrical and electronic systems required for the continued safe flight and landing of the airplane. Effective measures against the effects of exposure to HIRF must be provided by the design and installation of these systems. The accepted maximum energy levels in which civilian airplane system installations must be capable of operating safely are based on surveys and analysis of existing radio frequency emitters. These special conditions require that the airplane be evaluated under these energy levels for the protection of the electronic system and its associated wiring harness. These external threat levels, which are lower than previous required values, are believed to represent the worst case to which an airplane would be exposed in the operating environment.

These special conditions require qualification of systems that perform critical functions, as installed in aircraft, to the defined HIRF environment in paragraph 1 or, as an option to a fixed value using laboratory tests, in paragraph 2, as follows:

(1) The applicant may demonstrate that the operation and operational capability of the installed electrical and electronic systems that perform critical functions are not adversely affected when the aircraft is exposed to the HIRF environment defined:

(2) The applicant may demonstrate by a system test and analysis that the electrical and electronic systems that perform critical functions can withstand a minimum threat of 100 volts per meter, electrical field strength, from 10 kHz to 18 GHz. When using this test to show compliance with the HIRF requirements, no credit is given for signal attenuation due to installation.

The applicant, for approval by the FAA, to identify either electrical or electronic systems that perform critical functions, must perform a preliminary hazard analysis. The term “critical” means those functions, whose failure would contribute to, or cause, a failure condition that would prevent the continued safe flight and landing of the airplane. The systems identified by the hazard analysis that perform critical functions are candidates for the application of HIRF requirements. A system may perform both critical and non-critical functions. Primary electronic flight display systems, and their associated components, perform critical functions such as attitude, altitude, and airspeed indication. The HIRF requirements apply only to critical functions.

Compliance with HIRF requirements may be demonstrated by tests, analysis, models, similarity with existing systems, or any combination of these. Service experience alone is not acceptable since normal flight operations may not include an exposure to the HIRF environment. Reliance on a system with similar design features for redundancy as a means of protection against the effects of external HIRF is generally insufficient since all elements of a redundant system are likely to be exposed to the fields concurrently.

As discussed above, these special conditions are applicable to the Twin Commander Aircraft Models 690C, 690D, 695, 695A, and 695B. Should Twin Commander Aircraft LLC. apply at a later date for a supplemental type certificate to modify any other model on the same type certificate to incorporate the same novel or unusual design feature, the special conditions would apply to that model as well under the provisions of § 21.101.

This action affects only certain novel or unusual design features on one model of airplane. It is not a rule of general applicability and affects only the applicant who applied to the FAA for approval of these features on the airplane.

The substance of these special conditions has been subjected to the notice and comment period in several prior instances and has been derived without substantive change from those previously issued. It is unlikely that prior public comment would result in a significant change from the substance contained herein. For this reason, and because a delay would significantly affect the certification of the airplane, which is imminent, the FAA has determined that prior public notice and comment are unnecessary and impracticable, and good cause exists for adopting these special conditions upon issuance. The FAA is requesting comments to allow interested persons to submit views that may not have been submitted in response to the prior opportunities for comment described above.

In March of 2005, GE informed us that a records review of a certain engine revealed that the number of cycles accumulated on that engine, and its life-limited rotating parts, were recorded incorrectly in the operator's database in 1989. GE has advised us that the engine and rotating parts actually have more cycles accumulated than currently recorded. Upon further investigation, GE has confirmed that that engine was affected by an error in a tracking database that subtracted flight cycles from the actual accumulated cycles on a total of 32 rotating parts.

GE advises that 22 of the 32 affected rotating parts are in the control of a foreign operator, and under the jurisdiction of the Direction Generale de L'Aviation Civile (DGAC), which is the airworthiness authority for France. The DGAC advises that there are three of the 32 parts installed on foreign registered airplanes, but not under the jurisdiction of the DGAC. The location, current cycle count, and corrected cycle count are known for these 25 parts. None of these 25 parts have exceeded their LCF life limit. GE advises that they do not know the locations or current cycle counts of the remaining seven affected rotating parts. These seven parts could be in service with accumulated cyclic life exceeding their LCF life limit. We are including the three parts mentioned previously with the seven parts, as being affected by this AD, to ensure their cyclic lives get corrected. This condition, if not corrected, could result in failure of rotating parts that may have exceeded their LCF life limit, leading to uncontained engine failure.

The unsafe condition described previously is likely to exist or develop on other GE CF6-45 and CF6-50 series turbofan engines of the same type design. For that reason, we are issuing this AD to prevent rotating parts that may have exceeded their LCF life limit, from failing, leading to uncontained engine failure. This AD requires:

• Reviewing the engine records within 10 days after the effective date of this AD, for the existence of rotating parts listed by SN in this AD; and

• Correcting the records for those parts; and

• Within 100 cycles-in-service after the effective date of this AD, removing from service those parts exceeding their LCF life limits.

Since an unsafe condition exists that requires the immediate adoption of this AD, we have found that notice and opportunity for public comment before issuing this AD are impracticable, and that good cause exists for making this amendment effective in less than 30 days.

This AD is a final rule that involves requirements affecting flight safety and was not preceded by notice and an opportunity for public comment; however, we invite you to send us any written relevant data, views, or arguments regarding this AD. Send your comments to an address listed under ADDRESSES. Include “AD Docket No. FAA-2005-20932; Directorate Identifier 2005-NE-11-AD” in the subject line of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of the rule that might suggest a need to modify it.

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 AD. Using the search function of the DMS Web site, anyone can find and read the comments in 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.). 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.

You may examine the docket that contains the AD, any comments received, and any final disposition in person at the DMS Docket Offices between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The Docket Office (telephone (800) 647-5227) is located on the plaza level of the Department of Transportation Nassif Building at the street address stated in ADDRESSES. Comments will be available in the AD docket shortly after the DMS receives them.

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 rulemaking action.

We have determined that this AD will not have federalism implications under Executive Order 13132. This AD will 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.

For the reasons discussed above, I certify that the regulation:

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 AD and placed it in the AD Docket. You may get a copy of this summary at the address listed under ADDRESSES.

Natchez Animal Supply Co., 201 John R. Junkin Dr., Natchez, MS 39120, has requested that FDA withdraw approval of NADA 121-557 for THR Worm (dichlorophene and toluene) Capsules used in dogs and cats for removal of certain intestinal parasites. This action is requested because the product is no longer manufactured or marketed. The animal drug regulations are amended to reflect the withdrawal of approval.

This rule does not meet the definition of “rule” in 5 U.S.C. 804(3)(A) because it is a rule of “particular applicability.” Therefore, it is not subject to the congressional review requirements in 5 U.S.C. 801-808.

Merial Ltd., 3239 Satellite Blvd., Bldg. 500, Duluth, GA 30096-4640, has informed FDA that it has transferred ownership of, and all rights and interest in, NADA 141-241 for ZIMECTERIN-EZ (ivermectin) 0.6% w/w for Horses to Farnam Companies, Inc., 301 West Osborn, Phoenix, AZ 85013-3928.

This rule does not meet the definition of “rule” in 5 U.S.C. 804(3)(A) because it is a rule of “particular applicability.” Therefore, it is not subject to the congressional review requirements in 5 U.S.C. 801-808.

The Parole Commission's hearing examiners travel to more than 60 locations of Federal correctional facilities to conduct parole release and revocation hearings. In order to reduce travel costs and to conserve the time and effort of its hearing examiners, in 2004 the Commission initiated a pilot project in which examiners conducted some parole release hearings by videoconference between the Commission's office in Maryland and the prisoner's Federal institution. The Commission published an interim rule that provided notice that the Commission would be using the videoconference procedure. 69 FR 5273 (Feb. 4, 2004).

By the end of 2004, the Commission conducted 102 hearings via videoconference at 11 institutions. The videoconference technology has worked well. Video and audio transmissions are clear and the hearings are seldom interrupted by technical difficulties. The Commission's experience is that the prisoner's ability to effectively participate in the hearing has not been diminished by the use of the videoconference procedure.

The Commission's pilot project only included parole release hearings. Now the Commission is extending the use of the videoconference procedure to institutional revocation hearings. A revocation hearing is held at a Federal institution when the releasee admits to the violation charge, is convicted of a new crime, or waives a local revocation hearing, i.e., a hearing at the place of the alleged violation or arrest. Adverse witnesses are not produced at institutional revocation hearings for confrontation and cross-examination. On rare occasions, the releasee has a witness testify on his behalf at the hearing. Because the violation charge is either not contested by the releasee or is conclusively established by the new conviction, an institutional revocation hearing primarily focuses on the decisions regarding the appropriate prison term for the releasee's violation and whether the releasee should be returned to the community on supervision. Therefore, an institutional revocation hearing bears considerable similarity to a parole determination proceeding. Given this similarity and the additional cost savings and conservation of resources that may be gained from use of the videoconference procedure, the Commission is adding institutional revocation hearings to those hearings an examiner may conduct by videoconference.

Extending the videoconference procedure to institutional revocation hearings will provide additional flexibility for both the Commission and the Bureau of Prisons in the disposition of accused release violators and the use of personnel. For example, if the releasee is serving a new prison term at an institution where the Commission conducts parole hearings via videoconference, the Bureau will be able to designate that same institution as the site of the releasee's institutional revocation hearing. This saves either the cost of transporting the releasee to FTC Oklahoma or FDC Philadelphia, the institutions where the Commission conducts the majority of institutional revocation hearings, or the cost of sending a hearing examiner to travel to the institution to conduct one institutional revocation hearing when all other hearings at that same institution are conducted via videoconference. Moreover, conducting institutional revocation hearings by videoconference may avoid some violations of the 90-day time period for holding such hearings in situations where transportation difficulties or other problems have delayed the scheduling of the hearing.

The Commission is promulgating this rule as an interim rule in order to promptly take full advantage of the cost savings and other benefits in the deployment of examiner personnel that result from the extension of the videoconference procedure to institutional revocation hearings. The Commission is providing a 60-day period for the public to comment on the use of the videoconference procedure for such revocation hearings.

The amended rule will take effect May 13, 2005, and will apply to institutional revocation hearings for Federal parolees and District of Columbia parolees and supervised releasees held on or after the effective date.

The U.S. Parole Commission has determined that this interim rule does not constitute a significant rule within the meaning of Executive Order 12866.

This regulation will not have substantial direct effects 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. Under Executive Order 13132, this rule does not have sufficient federalism implications requiring a federalism Assessment.

The interim rule will not have a significant economic impact upon a substantial number of small entities within the meaning of the Regulatory Flexibility Act, 5 U.S.C. 605 (b), and is deemed by the Commission to be a rule of agency practice that does not substantially affect the rights or obligations of non-agency parties pursuant to Section 804 (3) (c) of the Congressional Review Act.

This rule will not cause State, local, or tribal governments, or the private sector, to spend $100,000,000 or more in any one year, and it will not significantly or uniquely affect small governments. No action under the Unfunded Mandates Reform Act of 1995 is necessary.

This rule is not a major rule as defined by Sec. 804 of the Small Business Regulatory Enforcement Fairness Act of 1996. This rule will not result in an annual effect on the economy of $100,000,000 or more; a major increase in costs or prices; or significant adverse effects on the ability of United States-based companies to compete with foreign-based companies.

I. Elimination of Nonavailability Statement Requirement and Specialized Treatment Service Program

The NDAA-02 was signed into law on December 28, 2001. Section 735 of NDAA-02 amends Section 721 of the NDAA-01 with respect to the nonavailability statement (NAS) elimination requirements and eliminates the requirement for non-enrolled TRICARE beneficiaries who live within a 40-mile radius of a military medical treatment facility (MTF) to obtain an NAS or preauthorization from an MTF before receiving nonemergent inpatient or obstetrical (inpatient or outpatient) services from a civilian provider in order that TRICARE will cost-share for such services. A non-enrolled TRICARE beneficiary is a beneficiary who has not enrolled in TRICARE Prime, but who has chosen to use the TRICARE Standard and TRICARE Extra options. Section 735 retains MTF NAS authority for inpatient mental health services within the usual 40-mile catchment area. The section establishes that the NAS elimination requirements are to take effect on the earlier of the date the health care services are provided under new TRICARE contracts or the date that is two years after the date of the enactment of NDAA-02. As the health care services under new TRICARE contracts were to be available after March 2004, the NAS requirements are eliminated for admissions occurring on or after December 28, 2003, which is the date that is two years after the date of the enactment of NDAA-02. For obstetrical care, the NAS requirement is eliminated for maternity episodes wherein the first prenatal visit occurs on or after December 28, 2003. An NAS is required when the first prenatal visit occurs before December 28, 2003, by 10 U.S.C. 1080(b). The NAS for inpatient mental health care will continue to be required.

With the exception of maternity care, Section 735 of NDAA-02 gives the Secretary of DoD the authority to waive the NAS elimination requirements if: (a) Significant costs would be avoided by performing specific procedures at the affected military treatment facility (MTF); (b) A specific procedure must be provided at the affected MTF to ensure the proficiency levels of the practitioners at the facility; or (c) the lack of NAS data would significantly interfere with TRICARE contract administration. When this waiver authority will be exercised, the Department will notify the affected beneficiaries by publishing a notice in the Federal Register and notify the Congress. The TRICARE policy requires MTFs, TRICARE Regions, and the contractors to publicize any NAS requirements to the affected beneficiaries with respect to any use of the waiver authority. In addition, outreach efforts will include posting Web site announcements on the TRICARE Web site directing affected beneficiaries to their local MTF Web sites with regard to any use of the waiver authority.

Section 735 of NDAA-02 furthermore eliminates the multi-regional and national NAS requirement for specialized treatment services (STSs) for TRICARE Standard beneficiaries who live outside the 200-mile radius of a STS facility. STS facilities were those designated facilities with regional, multi-regional or national catchment areas which provided complex medical and surgical services pursuant to 32 CFR 199.4(a)(10). Since the Department decided to terminate the STS program no later than June 1, 2003, all regional, multi-regional, and national NAS requirements under TRICARE Standard and authorization requirements under TRICARE Prime for STSs were eliminated before that date. The rationale behind the termination of the STS program was that this program was not based upon nationally developed consensus or evidenced-based criteria for clinical quality (there were none at the inception of this program) and had not consistently demonstrated cost-benefit to the government. In addition, the NAS requirement for STSs placed an unreasonable burden on our beneficiaries who had to travel extended distances to the STS facilities. This provided for enhanced continuity of care for TRICARE Standard beneficiaries who generally receive most medical and surgical services from civilian providers of their choice. The interim final rule gave notice of the Department's decision to terminate the STS program entirely no later than June 1, 2003.

This rule implements Section 728 of NDAA-01 (Pub. L. 106-398) which was enacted on October 30, 2000. Section 728 requires that prior authorization (or more precisely, preauthorization as defined in 32 CFR 199.2(b)) before referral to a specialty care provider that is part of the network be eliminated as part of any new TRICARE contracts entered into by the Department of Defense after the date of the enactment of the Act. This means that medical necessity preauthorization will not be required when primary care or specialty care providers refer TRICARE Prime patients for consultation appointment services, which are provided within the contractors' network of providers. Only TRICARE Prime patients required preauthorization for obtaining consultation appointment services. TRICARE Prime beneficiaries are required to use network providers if available. This rule removes the requirement to obtain a medical necessity determination when the consultation services are provided within the contractor's network. Section 728 of NDAA-01 does not eliminate the requirement for medical necessity preauthorizations for specific procedures or other health care services which specialty providers may recommend for beneficiaries as a result of the original consultation appointment or the need for preauthorization referral to non-network providers. For example, a consultation might result in a recommendation for a high cost surgical procedure on a nonemergent basis. The specialist's intent to perform this procedure may still be subjected to medical necessity preauthorization based upon utilization review criteria as has been TRICARE policy for years in conformance with the peer review organization program in section 199.15.

In summary, under new TRICARE contracts, requests for consultation appointment services will not be subjected to medical necessity preauthorization though other health care services may continue to require preauthorizations based on a determination of best business practices.

We published the interim final rule on July 31, 2003, and provided a 60-day comment period. We received comments from one national association and two other commenters. These comments and the Department's responses are summarized below.

Comment: Essentially, the commenter raised concerns regarding the stated means of communicating to beneficiaries and providers the intent to exercise the waiver authority to require a nonavailability statement (NAS). The interim final rule stated that if the waiver authority is exercised, the Department will notify the affected beneficiaries by publishing a notice in the Federal Register.

Response: While these are used to announce the program changes and requirements to the public, the Federal Register notices are not the only means of communication upon which the Department relies. The Department is sensitive to streamlining administrative processes and recognizes the importance of communicating with the beneficiaries and providers with regard to any use of the waiver authority and any new NAS requirements. It is for this reason that we have included a provision in the TRICARE Policy Manual that requires military treatment facilities (MTFs), TRICARE Regions, and the contractors to publicize any NAS requirements to the affected beneficiaries with respect to any use of the waiver authority. We have included this clarification in this final rule. Normally, the TRICARE policy changes and new requirements are announced in the routine provider bulletins and beneficiary newsletters by TRICARE contractors. In addition, outreach efforts will include posting Web site announcements on the TRICARE Web site directing affected beneficiaries to their local MTF Web sites; sharing information with military and civilian media and beneficiary association publications; and partnering with network and non-network providers through the contractors and local American Medical Association organizations.

Comment: One commenter argued that the DoD should totally eliminate the NAS for TRICARE Standard beneficiaries and made several comments. With regard to the legislative provision that requires elimination of NAS or preauthorization from an MTF, this commenter stated that the law has eliminated preauthorization for TRICARE Standard, yet DoD rules do not comply. With regard to the title of this rule, the commenter argued that to title this rule “Elimination of the nonavailability statement” is deceiving to TRICARE Standard beneficiaries, since it has not been eliminated except for maternity care, and DoD should reveal the facts. The commenter stated that the beneficiary could have no rights under this rule to use TRICARE Standard rather than the MTF, and the rule grants authority to DoD to continue use of the NAS. With reference to the regulatory language in the rule, the commenter requested clarification regarding the use and impact of the term MTFs. Regarding the structure of the rule, the commenter stated that the entire document is confusing in applicability to TRICARE Prime vs. TRICARE Standard and suggested that at the beginning of each paragraph it should be specified whether it applies to Standard or Prime, or both. The commenter also raised concerns that the notification by a Federal Register notice with regard to using the waiver authority to require an NAS is inadequate and stated that unless a reasonable mechanism can be established to notify each beneficiary and provider of the need for the NAS, the rule cannot be fairly implemented. In all cases when the beneficiary is denied a request for NAS, the commenter suggested that the beneficiary should be notified in writing within 24 hours giving the specific reasons related to: (a) The significant costs that would be avoided, (b) a specific procedure that must be provided at the affected MTF to ensure the proficiency levels of the practitioners, or (c) the lack of NAS data that would significantly interfere with TRICARE contract administration. The commenter emphasized the importance of detailed explanation for NAS denial and specific cost data and stated that the waiver authority is so liberal that the practical effect is to grant carte blanche authority to deny NAS request when the MTF is underutilized. Finally, the commenter presented a detailed argument in favor of total elimination of NAS.

Response: The rule eliminated the NAS requirements as provided by the law. It is incorrect to say that the DoD rules do not comply with respect to the elimination of MTF preauthorization. The fact is that under TRICARE, no care is preauthorized by MTFs and it was NAS that was administered by MTFs. The TRICARE contractors were required to preauthorize those admissions that required an NAS and that preauthorization was eliminated with the elimination of NAS. The title of this rule is appropriate and it is not deceiving as the rule does eliminate maternity and inpatient NAS with the exception of NAS for mental health admissions, and all the relevant information is presented in the rule. The fact that the rule provides information with regard to the waiver authority to require an NAS does not mean that it does not eliminate the inpatient NAS. It is incorrect to say that the beneficiary could have no rights under this rule to use TRICARE Standard other than the MTF. Use of an MTF is not required for emergency care or when a beneficiary has other health insurance and an NAS can never be required in such situations. The use of the term MTFs in the regulatory language is consistent with the provisions in Section 735 of the National Defense Authorization Act for Fiscal Year 2002. It is a plural of the term military treatment facility (MTF) and will be applicable when more than one MTF are granted a waiver to require an NAS. Regarding the structure of the rule, section I of the rule is clear that the NAS requirements are eliminated for non-enrolled beneficiaries and it has defined a non-enrolled beneficiaries as a beneficiary who is not enrolled in TRICARE Prime and has chosen to use TRICARE Standard and TRICARE Extra options. It should be noted that the NAS applies to non-enrolled beneficiaries and it does not apply under TRICARE Prime. With regard to termination of the specialized treatment service (STS) program, we have added language in Section I of the rule that clarifies that the STS program was terminated under both the TRICARE Standard and Prime. Section II. of the rule is clear that the elimination of prior authorization before referral to specialty care providers applies under TRICARE Prime. With regard to the notification concerning the waiver authority to require an NAS, see the response under the first comment, above. It should be noted that whenever an NAS is denied, the beneficiary is promptly notified and given the appeal rights. The specific information pertaining to the significant costs, procedures, etc., pertains to the waiver criteria for requiring an NAS and will be required by the Department for review and consideration from the MTF requesting the waiver. With the exception of maternity care, the law gives DoD the waiver authority to require an NAS under certain specified conditions. However, it should be noted that granting a waiver to an MTF to require an NAS is a complicated process and it involves notification to the Congress. Given the complexity of the process and its impact on beneficiaries and providers, the Department does not foresee any waivers at this time. However, should there be any exceptions, the Department anticipates any waivers granted would be implemented on a local basis, as needed, and the NAS requirements will be announced well in advance of their implementation. Essentially, this rule has followed the directions provided by the statute.

Comment: The commenter supported the rule and suggested that TRICARE remove the requirement for prior authorization of outpatient medical procedures under TRICARE Standard that are approved by the beneficiary's other health insurance (OHI).

Response: With the exception of adjunctive dental care, Program for Persons with Disabilities benefit, outpatient psychotherapy beyond the eighth visit, and psychoanalysis, an earlier policy change removed the preauthorization requirements for outpatient medical procedures for those TRICARE beneficiaries who have OHI.

The rule has been reviewed by the Office of Management and Budget. Executive order 12866 requires certain regulatory assessments for any significant regulatory action, defined as one which would result in an annual effect on the economy of $100 million or more, or have other substantial impacts. The Regulatory Flexibility Act (RFA) requires that each Federal agency prepare, and make available for public comment, a regulatory flexibility analysis when the agency issues a regulation which would have significant impact on a substantial number of small entities.

This rule is not an unfunded mandate under the Unfunded Mandate Reform Act and it is not a significant regulatory action under E.O. 12866 that could potentially add more than $100 million in estimated annual costs for DoD, or state, local, tribal governments, and the private sector. This rule does not require a regulatory flexibility analysis as the policy action was taken by Congress and the rule merely puts it into effect. The policy of the Regulatory Flexibility Act that agencies adequately evaluate all potential options for an action does not apply when Congress has already dictated the action.

This rule will not impose significant additional information collection requirements on the public under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3511).

Regulated Entities. The entities potentially affected by this action include the following categories of sources:

This table is not intended to be exhaustive, but rather provides a guide for readers regarding entities likely to be affected by this action. Not all facilities listed classified under the NAICS code or SIC code are affected. To determine whether your facility is affected by this action, you should examine the applicability criteria in § 63.1100 of the generic MACT standards (40 CFR part 63). If you have any questions regarding the applicability of these technical corrections to a particular entity, contact the person listed in the preceding FOR FURTHER INFORMATION CONTACT section.

Worldwide Web (WWW). In addition to being available in the docket, electronic copies of recently proposed and final rules are also available on the WWW through EPA's Technology Transfer Network (TTN). Following signature, a copy of the direct final rules will be posted on the TTN's policy and guidance page for newly proposed or promulgated rules at http://www.epa.gov/ttn/oarpg. The TTN provides information and technology exchange in various areas of air pollution control. If more information regarding the TTN is needed, call the TTN HELP line at (919) 541-5384.

Comments. We are publishing the direct final rule amendments without prior proposal because we view the amendments as noncontroversial and do not anticipate adverse comments. However, in the Proposed Rules section of today's Federal Register, we are publishing a separate document that will serve as the proposal to the amendments in the rules if adverse comments are filed. If we receive any adverse comments on one or more distinct amendments, we will publish a timely withdrawal in the Federal Register informing the public which amendments will become effective and which amendments are being withdrawn due to adverse comments. We will address all public comments in subsequent final rules based on the proposed rules. Any of the distinct amendments in today's final rules for which we do not receive adverse comment will become effective on the previously mentioned date. We will not institute a second comment period on this action. Any parties interested in commenting must do so at this time.

Judicial Review. Under section 307(b)(1) of the CAA, judicial review of these direct final rules is available only by filing a petition for review in the U.S. Court of Appeals for the District of Columbia Circuit by June 13, 2005. Under section 307(d)(7)(B) of the CAA, only an objection to the direct final rule amendments that was raised with reasonable specificity during the period for public comment can be raised during judicial review. Moreover, under section 307(b)(2) of the CAA, the requirements established by the direct final rule amendments may not be challenged separately in any civil or criminal proceedings brought by the EPA to enforce these requirements.

Outline. The following outline is provided to aid in reading the direct final rule amendments:

We are amending two rules. One rule is the National Emissions Standards for Hazardous Air Pollutants for Source Categories: Generic Maximum Control Technology Standards which were promulgated in June 1999 (64 FR 34863) and also referred to as the Generic Maximum Achievable Control Technology or “GMACT” rule, provide a structural framework that allows source categories with similar emission types and control requirements to be covered under common subparts; thus, promoting regulatory consistency in the development of national emission standards for hazardous air pollutants (NESHAP). The other rule is the National Emission Standards for Ethylene Manufacturing Process Units: Heat Exchange Systems and Waste Operations which were promulgated in July 2002 (67 FR 46258) in the same notice that added by amendment the Ethylene Production source category to the GMACT rule applicability.

The amendments in today's action clarify the compliance requirements for benzene waste streams, clarify the requirements for heat exchangers and heat exchanger systems, and stipulate the provisions for offsite waste transfer in the national emission standards for ethylene manufacturing process units (40 CFR part 63, subpart XX).

The amendments in today's action will also correct the regulatory language that make emissions from ethylene cracking furnaces during decoking operations an exception to the provisions, delineate overlapping requirements for storage vessels and transfer racks, and correct typographical errors in Table 7 to 40 CFR 63.1103(e), “What are my requirements if I own or operate an ethylene production existing or new affected source?”

In addition, we are correcting errors to Table 3 to 40 CFR 63.1103(b)(3)(ii), “What are my requirements if I own or operate an acrylic and modacrylic fiber production existing or new affected source and am complying with paragraph (b)(3)(ii) of this section?” in the proposed rule for the Acrylic and Modacrylic Fiber Production source category which were not corrected as indicated in the preamble to the June 1999 final rule (64 FR 34863).

Today's actions include amendments to the NESHAP for ethylene manufacturing process units to clarify compliance requirements for benzene waste streams, to clarify the requirements for heat exchangers and heat exchanger systems, and to stipulate the provisions for offsite waste transfer. We are also amending the generic MACT standards to correct the regulatory language to state that emissions from furnaces during decoking operations are an exception to the provisions, and we are delineating overlapping requirements for storage vessels and transfer racks. Another source in the generic MACT is acrylic and modacrylic fiber production for which we are amending the Compliance Requirements Table.

We are amending 40 CFR 63.1086(b)(4) and 63.1095(a) to change units from parts per million by volume (ppmv) to parts per million by weight (ppmw) so that the units of measure accurately reflect the units of measure of the tests used by affected sources.

We are amending 40 CFR 63.1086(a)(5) to clarify the interpretation of the heat exchanger leak calculation requirements. While not explicitly stated, our intent in § 63.1086(a) was to define heat exchange systems in such a way as to ensure that leaks of 3.06 kilogram per hour (kg/hr) (the intended low end threshold of what would constitute a leak) or greater of hazardous air pollutants (HAP) into the cooling water stream are detectable and to specify that a leak is detected if the exit mean concentration is at least 10 percent greater than the entrance mean.

We are amending 40 CFR 63.1086(a)(2)(ii)(B) and (b)(1)(ii) to include performance-based monitoring frequencies.

We are amending 40 CFR 63.1095(b) to reword the type of waste stream to “waste streams that contain benzene,” which is consistent with the wording in 40 CFR 61.342(c). The change clarifies that this section specifically applies to “waste streams” containing benzene, not benzene containing streams in general, since there are product streams that also contain benzene. We are also amending 40 CFR 63.1095(b) to clarify an option for an owner or operator to transfer waste off-site to another facility for treatment, according to 40 CFR 63.1096.

We are amending 40 CFR 63.1100(g)(1) to address overlapping storage vessel requirements in 40 CFR part 63, subpart YY, with the requirements in 40 CFR part 63, subparts G and CC.

We are amending 40 CFR 63.1103(e)(1)(ii)(J) by removing the term “furnace stack,” because decoking emissions do not exit through the furnace stack. We are amending 40 CFR 63.1103(e)(2) to include a definition of “organic HAP” that identifies organic HAP as those compounds listed in Table 1 to 40 CFR part 63, subpart XX.

We are amending 40 CFR 63.1103(g)(3) to clarify our intent that transfer racks at an ethylene affected source that are also subject to either 40 CFR part 63, subpart G, or 40 CFR part 61, subpart BB, are only required to comply with the requirements of 40 CFR part 63, subpart YY.

Paragraphs (b) and (e) of 40 CFR 63.1084 contain provisions that exempt heat exchange systems that contain less than 5 percent HAP by weight in either an intervening fluid or process fluid. We have been asked to clarify the frequency intended for determining the HAP content for the purpose of establishing or maintaining the exempt status of a heat exchange system. The HAP content must be determined prior to claiming the exemption. Thereafter, the HAP content must be determined whenever you are relying on the exemption and have reason to believe that the HAP content may be in excess of 5 percent. In general, if you make a process or operating change that would nullify the exemption and would, therefore, need to be identified as part of the affected source subject to 40 CFR part 63, subpart XX, you would make a determination shortly after the change is made and report the determination in the next semiannual report. Likewise, any determinations necessary to document continued exempt status following any process or operational changes that could affect the HAP content of the process fluid or intervening fluid should follow the same schedule. Along these same lines, if you do not make a process or operating change that could increase the HAP content of the process or intervening fluid, and you reasonably believe that the initial demonstration of exempt status is valid, you do not need to perform another determination. The periodic reporting requirements and schedule are specified in 40 CFR 63.1110(e) and (f).

In response to stakeholder questions, we are clarifying that at facilities with total annual benzene (TAB) quantities less than the 10 megagrams per year (Mg/yr) (the applicability threshold of the Benzene Waste Operations NESHAP in 40 CFR part 61, subpart FF), the provisions of 40 CFR part 63, subpart XX, require control of two benzene waste streams as specified in § 63.1095(b)(1), and require control of continuous butadiene waste streams meeting the concentration and flow rate criteria at any benzene level (under 40 CFR 63.1095(a)(3)). Section 63.1095(b)(1) requires facilities whose TAB quantity from waste is less than 10 Mg/yr to manage and treat the two named benzene waste streams—spent caustic waste streams and dilution steam blowdown waste streams—according to 40 CFR 61.342(c)(1) through (c)(3)(i). Facilities with a TAB quantity from waste of 10 Mg/yr or greater must comply with the requirements of 40 CFR 63.1095(b)(2). These requirements are explained in the July 12, 2002, preamble to the final rule (67 FR 46265). Section 112 of the CAA requires standards for control of HAP, not only benzene; hence, all facilities subject to the Ethylene Production NESHAP (regardless of TAB quantity) are required to control continuous butadiene waste streams, as required in 40 CFR 63.1095(a).

We are clarifying the intent of provisions regarding overlapping provisions for leak detection and repair requirements for ethylene manufacturing process units (EMPU) as established by 40 CFR part 63, subpart UU. Equipment within an EMPU may potentially be regulated by several other equipment leak regulations, such as 40 CFR part 61, subparts J and V; 40 CFR part 60, subpart VV; and 40 CFR part 63, subpart H. To address this overlap, the regulations provide that in cases where 40 CFR part 63, subpart UU, overlaps the other requirements, the equipment need only comply with the subpart UU requirements, since subpart UU is at least as stringent as the overlapping regulations. For ease in compliance, we understand that some affected sources may wish to comply with subpart UU requirements for equipment leaks for the entire EMPU, even for equipment not in HAP service. In these cases, the owner or operator should specify the use of 40 CFR part 63, subpart UU, for the entire EMPU in the Notification of Compliance Status report required by 40 CFR 63.1110(a)(4).

We are clarifying the intent of the exclusions contained in 40 CFR 63.1100(e)(1)(iii) and how they relate to the overlap requirements. For process units that are currently regulated under other subparts of 40 CFR part 63, § 63.1100(g) provides provisions when applicability of 40 CFR part 63, subpart YY, and other subparts of 40 CFR parts 60, 61 and 63 overlap, allowing sources to elect which subpart to comply with in some cases. In respect to facilities that produce ethylene, these exclusions and overlap provisions were intended for facilities that have collocated process units currently subject to other 40 CFR part 63 subparts in addition to their ethylene production units. For example, a facility could have a refinery subject to 40 CFR part 63, subpart CC (Petroleum Refinery NESHAP), in addition to an ethylene production unit, and within the refinery operations there is equipment that separates propylene from the refinery gas stream, but the product propylene is not intended for, or used in, ethylene production. The equipment in question, while performing a function that is common to ethylene manufacturing, is already regulated under the Petroleum Refinery NESHAP (40 CFR part 63, subpart CC) and may be excluded from the Ethylene Production NESHAP (40 CFR part 63, subpart YY) applicability on that basis. Our overall intent is to avoid duplication and confusion in monitoring, recordkeeping and reporting requirements by requiring that process equipment that is potentially subject to more than one 40 CFR part 63 subpart must be in compliance with one subpart, but (pursuant to these exclusion and overlap provisions) need not comply with multiple subparts. These provisions and exclusions do not authorize noncompliance with any of the 40 CFR part 63 requirements for a source that would otherwise be subject to one or more 40 CFR part 63 subparts.

We are clarifying that small containers, portable bins and portable tanks are not included in the definition of “storage vessel or tank” found in 40 CFR 63.1101 since the definition applies to “* * * a stationary unit * * *.” It was not our intent to regulate the small containers, portable bins and portable tanks, and we believe that by distinguishing that the vessels must be stationary is adequate for determining regulated vessels.

Section 63.1105(h)(1) of 40 CFR part 63 requires “the pressure test procedures specified in Method 27 of appendix A to 40 CFR part 60” to test for vapor tightness. Vapor tight, as defined in 40 CFR 63.1105(d)(2), means that the pressure in the tank will not drop more than 750 pascals within 5 minutes after it is pressurized to a minimum of 4,500 pascals. This regulatory wording clearly requires you to test for vapor tightness using the pressure test procedures described in Method 27 and does not require a vacuum test. We confirm that it is our intent to require only pressure testing. The appropriate pressure test is described in 40 CFR part 60, appendix A, section 8.2.2 of Method 27, and the vacuum test described in section 8.2.3 of Method 27 is not required.

Under Executive Order 12866 (58 FR 51735, October 4, 1993), we must determine whether the regulatory action is “significant” and, therefore, subject to review by the Office of Management and Budget (OMB) and the requirements of the Executive Order. The Executive Order defines “significant regulatory action” as one that is likely to result in a rule that may:

(1) Have an annual effect on the economy of $100 million or more or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal governments or communities;

(2) create a serious inconsistency or otherwise interfere with an action taken or planned by another agency;

(3) materially alter the budgetary impact of entitlements, grants, user fees, or loan programs, or the rights and obligations of recipients thereof; or

(4) raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in the Executive Order.

It has been determined that the direct final rule amendments are not a “significant regulatory action” under the terms of Executive Order 12866 and, therefore, are not subject to review by OMB.

This action does not impose an information collection burden under the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. The direct final rule amendments result in no changes to the information collection requirements of the standards or guidelines and will have no impact on the information collection estimate of project cost and hour burden made at the time these rule were promulgated. Therefore, the information collection requests have not been revised. The OMB has previously approved the information collection requirements contained in 40 CFR part 63, subpart YY under the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 et seq, and assigned OMB control number 2060-0420 (EPA ICR 1871.02) for Acrylic and Modacrylic Fiber Production, and OMB control number 2060-0489 for Ethylene Production (EPA ICR 1983.02).

Copies of the Information Collection Request (ICR) document(s) may be obtained from Susan Auby by mail at U.S. EPA, Office of Environmental Information, Collection Strategies Division (2822T), 1200 Pennsylvania Avenue, NW., Washington, DC 20460, by e-mail at auby.susan@epa.gov, or by calling (202) 566-1672. A copy may also be downloaded off the Internet at http://www.epa.gov/icr.

Burden means the total time, effort, or financial resources expended by persons to generate, maintain, retain, disclose or provide information to or for a Federal agency. This includes the time needed to review instructions; develop, acquire, install, and utilize technology and systems for the purposes of collecting, validating, and verifying information, processing and maintaining information, and disclosing and providing information; adjust the existing ways to comply with any previously applicable instructions and requirements; train personnel to be able to respond to a collection of information; search data sources; complete and review the collection of information; and transmit or otherwise disclose the information.

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 OMB control number. The OMB control numbers for EPA's regulations in 40 CFR are listed in 40 CFR part 9.

EPA has determined that it is not necessary to prepare a regulatory flexibility analysis in connection with the direct final rule amendments. For purposes of assessing the impacts of today's direct final rule amendments on small entities, a small entity is defined as: (1) A small business in the North American Industrial Classification System (NAICS) code 325 that has up to 500; (2) a small governmental jurisdiction that is a government of a city, county, town, school district or special district with a population of less than 50,000; and (3) a small organization that is any not-for-profit enterprise which is independently owned and operated and is not dominant in its field.

After considering the economic impacts of today's direct final rule amendments on small entities, we have concluded that this action will not have a significant economic impact on a substantial number of small entities. The direct final rule amendments will not impose any requirements on small entities. The direct final rule amendments provide clarifications and corrections to previously issued rules. Before promulgating the rule on acrylic and modacrylic fiber production in 1999 (64 FR 34863), we concluded that each standard applied to five or fewer major sources. In addition, we conducted a limited assessment of the economic effect of the proposed standards on small entities that showed no adverse economic effect for any small entities within any of these source categories. Similarly, before promulgating the rules on ethylene production in 2002 (67 FR 46258), we determined that there were no small entities affected by those rules.

Title II of the Unfunded Mandates Reform Act (UMRA) of 1995, Public Law 104-4, establishes requirements for Federal agencies to assess the effects of their regulatory actions on State, local, and tribal governments and the private sector. Under section 202 of the UMRA, we generally must prepare a written statement, including a cost-benefit analysis, for proposed and final rules with “Federal mandates” that may result in expenditures by State, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more in any 1 year. Before promulgating an EPA rule for which a written statement is needed, section 205 of the UMRA generally requires us to identify and consider a reasonable number of regulatory alternatives and adopt the least costly, most cost-effective, or least burdensome alternative that achieves the objectives of the rule. The provisions of section 205 do not apply when they are inconsistent with applicable law. Moreover, section 205 allows us to adopt an alternative other than the least costly, most cost-effective, or least burdensome alternative if we publish with the final rule an explanation why that alternative was not adopted.

Before we establish any regulatory requirements that may significantly or uniquely affect small governments, including tribal governments, we must develop a small government agency plan under section 203 of the UMRA. The plan must provide for notifying potentially affected small governments, enabling officials of affected small governments to have meaningful and timely input in the development of our regulatory proposals with significant Federal intergovernmental mandates, and informing, educating, and advising small governments on compliance with the regulatory requirements.

We have determined that the direct final rule amendments do not contain a Federal mandate that may result in expenditures of $100 million or more for State, local, and tribal governments, in the aggregate, or the private sector in any 1 year. Thus, the direct final rule amendments are not subject to the requirements of section 202 and 205 of the UMRA. In addition, we have determined that the direct final rule amendments contain no regulatory requirements that might significantly or uniquely affect small governments because they contain no requirements that apply to small governments or impose obligations on them.

Executive Order 13132 (64 FR 43255, August 10, 1999) requires EPA to develop an accountable process to ensure “meaningful and timely input by State and local officials in the development of regulatory policies that have federalism implications.” “Policies that have federalism implications” is defined in the Executive Order to include regulations that have “substantial direct effects 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.”

The direct final rule amendments do not have federalism implications. They will not have substantial direct effects 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, as specified in Executive Order 13132. The direct final rule amendments will not impose substantial direct compliance costs on State or local governments and will not preempt State law. Thus, Executive Order 13132 does not apply to the direct final rule amendments.

Executive Order 13175 (65 FR 67249, November 9, 2000) requires us to develop an accountable process to ensure “meaningful and timely input by tribal officials in the development of regulatory policies that have tribal implications.”

The direct final rule amendments do not have tribal implications, as specified in Executive Order 13175. They will not have substantial direct effects on tribal governments, on the relationship between the Federal government and Indian tribes, or on the distribution of power and responsibilities between the Federal government and Indian tribes, as specified in Executive Order 13175. Thus, Executive Order 13175 does not apply to the direct final rule amendments.

Executive Order 13045 (62 FR 19885, April 23, 1997) applies to any rule that: (1) Is determined to be “economically significant” as defined under Executive Order 12866, and (2) concerns an environmental health or safety risk that we have reason to believe may have a disproportionate effect on children. If the regulatory action meets both criteria, we must evaluate the environmental health or safety effects of the planned rule on children, and explain why the planned regulation is preferable to other potentially effective and reasonably feasible alternatives we considered.

EPA interprets Executive Order 13045 as applying only to those regulatory actions that are based on health or safety risks, such that the analysis required under section 5-501 of the Executive Order has the potential to influence the regulation. The direct final rule amendments are not subject to Executive Order 13045 because they are based on technology performance and not on health and safety risks. Also, the direct final rule amendments are not “economically significant.”

The direct final rule amendments are not subject to Executive Order 13211 (66 FR 28355, May 22, 2001) because it is not a significant regulatory action under Executive Order 12866.

Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (NTTAA), Public Law 104-113, 12(d)(15 U.S.C. 272 note) directs us to use voluntary consensus standards in our regulatory activities unless to do so would be inconsistent with applicable law or otherwise impractical. Voluntary consensus standards are technical standards (e.g., material specifications, test methods, sampling procedures, and business practices) developed or adopted by one or more voluntary consensus bodies. The NTTAA directs us to provide Congress, through OMB, explanations when we decide not to use available and applicable voluntary consensus standards.

The direct final rule amendments do not involve modifications to the technical standards specified in the final rules for Acrylic and Modacrylic Fiber Production and Ethylene Production. Therefore, we did not consider the use of any voluntary consensus standards.

The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of Congress and to the Comptroller General of the United States. We will submit a report containing the direct final rule and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the direct final rule amendments in the Federal Register. A major rule cannot take effect until 60 days after it is published in the Federal Register. These direct final rule amendments are not a “major rule” as defined by 5 U.S.C. 804(2).

EPA is publishing this rule without prior proposal because we view this as a noncontroversial amendment and anticipate no adverse comment. EPA emphasizes that it is not re-proposing the June 11, 1998, proposal (63 FR 32044) to restrict the sale of hydrofluorocarbon (HFC) and perfluorocarbon (PFC) substitutes, but is only taking action to correct the definitions of refrigerant and technician at § 82.152 and amend the venting prohibition at § 82.154(a) to make certain that the definitions and prohibition are consistent with the expressed intent of the March 12, 2004 (69 FR 11946) final rule to not restrict the sales of such substitutes. EPA discussed and responded to comments concerning the sales restrictions on substitutes for refrigerants, and its extension to substitutes for refrigerants that consist in part or whole of a class I or class II ozone-depleting substance in the March 12, 2004, final rulemaking (69 FR 11969).

In the “Proposed Rules” section of today's Federal Register publication, EPA is publishing a separate document that will serve as the proposal to amend the definitions of refrigerant and technician and prohibit the knowing venting of HFC and PFC substitutes. This direct final rule will become effective on June 13, 2005, without further notice unless we receive adverse comment regarding the intent of the amended definitions by May 13, 2005. If EPA receives adverse comment on the intent of the corrected definitions and the amended prohibition, we will publish a timely withdrawal in the Federal Register informing the public that the rule will not take effect. EPA will address all public comments on the proposed rule in a subsequent final rule. EPA will not institute a second comment period on this action. Any parties interested in commenting must do so at this time.

Entities potentially regulated by this action include those that manufacture, own, maintain, service, repair, or dispose of all types of air-conditioning and refrigeration equipment (i.e., appliances as defined by § 82.152); those who sell, purchase, or reclaim refrigerants and their substitutes; and those who own refrigerant recycling or recovery equipment. This listing is not intended to be exhaustive, but rather provides a guide for readers regarding entities likely to be regulated by this action. To determine whether your company is regulated by this action, you should carefully examine the applicability criteria contained in section 608 of the Clean Air Act Amendments of 1990 (the Act). The applicability criteria are discussed below and in regulations published on December 30, 1993 (58 FR 69638). If you have questions regarding the applicability of this action to a particular entity, consult the person listed in the preceding FOR FURTHER INFORMATION CONTACT section.

On March 12, 2004 (69 FR 11946), EPA amended the rule on refrigerant recycling, promulgated under section 608 of the Act, to clarify how the requirements of section 608 apply to substitutes for chlorofluorocarbon (CFC) and hydrochlorofluorocarbon (HCFC) refrigerants. This rule explicated the self-effectuating statutory prohibition against the knowing venting of substitutes to the atmosphere during the maintenance, service, repair, and disposal of appliances that became effective on November 15, 1995. The rule also exempted certain substitutes from the venting prohibition on the basis of current evidence that their release is adequately addressed by other authorities; hence, such release does not pose a threat to the environment under section 608 (69 FR 11949).

EPA also amended the refrigerant recovery and recycling requirements for CFC and HCFC refrigerants to accommodate the proliferation of new substitutes for these refrigerants on the market, and to clarify that the venting prohibition applies to all substitutes and refrigerants for which EPA has not made a determination that their release “does not pose a threat to the environment,” including HFC and PFC substitutes. The March 12, 2004 final rule was not intended to either mandate section 608 technician certification for those maintaining, repairing, or servicing appliances using substitutes that do not consist of a class I or class II ODS or to restrict the sale of substitutes that do not contribute to the depletion of the stratospheric ozone layer, such as pure HFC and PFC substitutes (69 FR 11946).

With this action, EPA is correcting the definitions of refrigerant and technician at § 82.152 and amending the prohibition against the knowing venting of substitutes at § 82.154(a). These amendments are being made to reflect the intent of the March 12, 2004 final rule to not regulate the sale of substitutes that do not consist of a class I or class II ozone-depleting substance.

While the intent of the March 12, 2004 final rule was not to restrict the sale of refrigerant substitutes that do not contribute to the depletion of the stratospheric ozone layer (69 FR 11946), the accompanying regulatory text could be construed as having the opposite effect. Specifically, the final rule's definition of refrigerant at § 82.152 (69 FR 11957) stated that, refrigerant means, for purposes of this subpart, any substance consisting in part or whole of a class I or class II ozone-depleting substance that is used for heat transfer purposes and provides a cooling effect, or any substance used as a substitute for such a class I or class II substance by any user in a given end-use, except for the following substitutes in the following end-uses:

(1) Ammonia in commercial or industrial process refrigeration or in absorption units;

(2) Hydrocarbons in industrial process refrigeration (processing of hydrocarbons);

(3) Chlorine in industrial process refrigeration (processing of chlorine and chlorine compounds);

(4) Carbon dioxide in any application;

(5) Nitrogen in any application; or

(6) Water in any application.

EPA is aware that the above definition of refrigerant could be construed as being at odds with the preamble that discusses the Agency's intent to not restrict the sale of substitutes that do not consist of a class I or class II ODS. The unintentional inclusion of the phrase or any substance used as a substitute for such a class I or class II substance * * *, implies that any substance, including pure HFCs and PFCs, used as a substitute for such a class I or class II substance would be captured under the definition of refrigerant. If left uncorrected, this could create ambiguity about the interpretation of the regulations promulgated at 40 CFR part 82, subpart F (i.e., section 608 regulations) and could have unintended implications on the prohibitions, required practices, and reporting and recordkeeping requirements of the regulations promulgated under section 608 of Title VI of the Clean Air Act (e.g., mandatory certification of technicians servicing appliances using pure HFC refrigerants and a restriction on the sale of HFC substitutes to certified technicians).

Therefore, EPA is correcting the definition of refrigerant by deleting the aforementioned phrase. The corrected definition at § 82.152 reads: Refrigerant means, for purposes of this subpart, any substance consisting in part or whole of a class I or class II ozone-depleting substance that is used for heat transfer purposes and provides a cooling effect. EPA has deleted the text specifying the exempted substitutes (namely, ammonia in commercial or industrial process refrigeration or in absorption units; hydrocarbons in industrial process refrigeration (processing of hydrocarbons); chlorine in industrial process refrigeration (processing of chlorine and chlorine compounds); carbon dioxide in any application; nitrogen in any application; or water in any application). Since these substances do not contain a class I or class II ODS, such a level of specificity is not required within the amended definition.

The correction to the definition of refrigerant requires an amendment to the regulatory venting prohibition at § 82.154(a). The March 12, 2004 amendment to the section 608 regulatory venting prohibition (69 FR 11979) states that, Effective May 11, 2004, no person maintaining, servicing, repairing, or disposing of appliances may knowingly vent or otherwise release into the environment any refrigerant from such appliances. * * * If not addressed, the corrected definition of refrigerant would exclude pure HFC and PFC substitutes 1 from the venting prohibition, because they do not consist in part or whole of a class I or class II ozone-depleting substance. The preamble to the March 12, 2004, final rule made clear that the Agency intended to exempt certain substitutes, namely, ammonia in commercial or industrial process refrigeration or in absorption units; hydrocarbons in industrial process refrigeration (processing of hydrocarbons); chlorine in industrial process refrigeration (processing of chlorine and chlorine compounds); carbon dioxide in any application; nitrogen in any application; or water in any application (69 FR 11949-54) from the statutory venting prohibition, because their release is adequately addressed by other entities; therefore, their release does not pose a threat to the environment under section 608 of Title VI of the Clean Air Act. However, EPA did not make such a finding for substitutes consisting in part or whole of an HFC or PFC substitute. So it remains illegal to knowingly vent substitutes consisting in part or whole of an HFC or PFC substitute during the maintenance, service, repair, or disposal of appliances (69 FR 11947).

In accordance with section 608(c)(2) of Title VI of the Clean Air Act (as amended in 1990), de minimis releases associated with good faith attempts to recapture and recycle or safely dispose of such substitutes shall not be subject to the prohibition. EPA has not promulgated regulations mandating certification of refrigerant recycling/recovery equipment intended for use with substitutes; therefore, EPA is not including a regulatory provision for the mandatory use of certified recovery/recycling equipment as an option for determining de minimis releases of substitutes. However, the lack of a regulatory provision should not be interpreted as an exemption to the venting prohibition for non-exempted substitutes. The regulatory prohibition at § 82.154(a) reflects the statutory reference to de minimis releases of substitutes as they pertain to good faith attempts to recapture and recycle or safely dispose of such substitutes.

In order to emphasize that the knowingly venting of HFC and PFC substitutes remains illegal during the maintenance, service, repair, and disposal of appliances and to make certain that the de minimis exemption for refrigerants remains in the regulatory prohibition, § 82.154(a) is amended to reflect the venting prohibition of section 608(c)(2) of the Act. Therefore, the amended definition of refrigerant means that refrigerant releases shall be considered de minimis only if they occur when: (1) The required practices set forth in § 82.156 are observed, recovery or recycling machines that meet the requirements set forth in § 82.158 are used, and the technician certification provisions set forth in § 82.161 are observed; or (2) the requirements set forth for the service of motor vehicle air-conditioners (MVACs) in subpart B (i.e., section 609) of this part are observed. EPA is also specifying, in the regulatory prohibition at § 82.154(a), the substitutes that have been exempted from the statutory venting prohibition. EPA has made this edit in order to clarify which substitutes are exempt from the venting prohibition. Hence, EPA is amending the prohibition at § 82.154(a) to read: (a) Effective June 13, 2005, no person maintaining, servicing, repairing, or disposing of appliances may knowingly vent or otherwise release into the environment any refrigerant or substitute from such appliances, with the exception of the following substitutes in the following end-uses:

(1) Ammonia in commercial or industrial process refrigeration or in absorption units;

(2) Hydrocarbons in industrial process refrigeration (processing of hydrocarbons);

(3) Chlorine in industrial process refrigeration (processing of chlorine and chlorine compounds);

(4) Carbon dioxide in any application;

(5) Nitrogen in any application; or

(6) Water in any application.

In 1994, EPA finalized the definition of technician at § 82.152 to read: Technician means any person who performs maintenance, service, or repair that could be reasonably expected to release class I or class II refrigerants from appliances, except for MVACs, into the atmosphere. * * * (59 FR 55912 (November 9, 1994)). On June 11, 1998 (63 FR 32089), EPA proposed an amendment to the definition of technician to include persons who perform maintenance, service, repair, or disposal that could be reasonably expected to release class I substances, class II substances, or substitutes from appliances into the atmosphere (63 FR 32059). The intent of proposed amendment to the definition was to require section 608 technician certification for persons maintaining, repairing, servicing, or disposing of appliances containing non-exempt substitutes; however, EPA did not intend to remove the phrase except for MVACs from the definition of technician.

A petition for review challenging the March 12, 2004 final rule stated that the amended definition of technician could be misinterpreted to mean that technicians servicing and maintaining MVACs must also have section 608 technician certification. In the course of finalizing the March 12, 2004 rulemaking (69 FR 11979), EPA inadvertently removed the text except for MVACs from the definition of technician, at § 82.152. Since EPA did not intend for the amended definition of technician to include persons servicing or repairing MVACs, the Agency is reverting to the original definition.

Under Executive Order 12866, (58 FR 51,735 (October 4, 1993)) the Agency must determine whether the regulatory action is “significant” and therefore subject to the Office of Management and Budget (OMB) review and the requirements of the Executive Order. The Order defines “significant regulatory action” as one that is likely to result in a rule that may: (1) Have an annual effect on the economy of $100 million or more or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal governments or communities; (2) create a serious inconsistency or otherwise interfere with an action taken or planned by another agency; (3) materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights and obligations of recipients thereof; or (4) raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in the Executive Order.

It has been determined that this rule is not a “significant regulatory action” under the terms of Executive Order 12866 and is therefore not subject to Executive Order 12866 review.

OMB has previously approved the information collection requirements contained in the existing regulations at 40 CFR part 82, subpart F under the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. and has assigned OMB Control Number 2060-0256, EPA ICR number 1626.07. A copy of the OMB approved Information Collection Request (ICR) may be obtained from Susan Auby, Collection Strategies Division; U.S. Environmental Protection Agency (2822T); 1200 Pennsylvania Ave., NW., Washington, DC 20460 or by calling (202) 566-1672. This action does not impose any new information collection burden beyond the already-approved ICR.

Burden means the total time, effort, or financial resources expended by persons to generate, maintain, retain, or disclose or provide information to or for a Federal agency. This includes the time needed to review instructions; develop, acquire, install, and utilize technology and systems for the purposes of collecting, validating, and verifying information, processing and maintaining information, and disclosing and providing information; adjust the existing ways to comply with any previously applicable instructions and requirements; train personnel to be able to respond to a collection of information; search data sources; complete and review the collection of information; and transmit or otherwise disclose the information. 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 OMB control number. The OMB control numbers for EPA's regulations in 40 CFR are listed in 40 CFR part 9.

EPA has determined that it is not necessary to prepare a regulatory flexibility analysis in connection with this direct final rule. For purposes of assessing the impacts of today's rule on small entities, small entity is defined as: (1) A small business as defined by Small Business Administration size standards primarily engaged in the supply and sale of motor vehicle air-conditioning refrigerants as defined by NAIC codes 42114, 42193, and 441310; (2) a small governmental jurisdiction that is a government of a city, county, town, school district or special district with a population of less than 50,000; and (3) a small organization that is any not-for-profit enterprise which is independently owned and operated and is not dominant in its field.

After considering the economic impacts of today's final rule on small entities, EPA has concluded that this action will not have a significant economic impact on a substantial number of small entities. EPA has determined that approximately 819 small entities will experience an impact ranging from 0.001 percent to 0.163 percent, based on their annual sales and revenues.

Although this final rule will not have a significant economic impact on a substantial number of small entities, EPA nonetheless has tried to reduce the impact of this rule on small entities. EPA is finalizing this rulemaking to make certain that the regulatory text in the March 12, 2004 rulemaking (63 FR 11946) is consistent with the intent to not regulate the use or sale of substitutes that do not consist of a class I or class II ozone-depleting substance, while making certain that the statutory prohibition against knowingly releasing such substitutes remains. This rule corrects the definitions of refrigerant and technician and makes certain that only substances consisting whole or in part of a class I or class II ODS are covered under the section 608 refrigerant regulations. Hence any burden associated with technician certification or sales of refrigerant substitutes not consisting of an ODS is removed.

Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public Law 104-4, establishes requirements for Federal agencies to assess the effects of their regulatory actions on State, local, and tribal governments and the private sector. Under section 202 of the UMRA, EPA generally must prepare a written statement, including a cost-benefit analysis, for proposed and final rules with “Federal mandates” that may result in expenditures to State, local, and tribal governments, in the aggregate, or to the private sector of $100 million or more in any one year. Before promulgating an EPA rule for which a written statement is needed, section 205 of the UMRA generally requires EPA to identify and consider a reasonable number of regulatory alternatives and adopt the least costly, most cost-effective or least burdensome alternative that achieves the objectives of the rule. The provisions of section 205 do not apply when they are inconsistent with applicable law. Moreover, section 205 allows EPA to adopt an alternative other than the least costly, most cost-effective or least burdensome alternative if the Administrator publishes with the final rule an explanation why that alternative was not adopted. Before EPA establishes any regulatory requirements that may significantly or uniquely affect small governments, including tribal governments, it must have developed under section 203 of the UMRA a small government Agency plan. The plan must provide for notifying potentially affected small governments, enabling officials of affected small governments to have meaningful and timely input in the development of EPA regulatory proposals with significant Federal intergovernmental mandates, and informing, educating, and advising small governments on compliance with the regulatory requirements.

EPA has determined that this rule does not contain a Federal mandate that may result in expenditures of $100 million or more for State, local, and tribal governments, in the aggregate, or the private sector in any one year. This rule supplements the statutory self-effectuating prohibition against venting refrigerants by ensuring that certain service practices are conducted that reduce emissions and establish equipment and reclamation certification requirements. These standards are amendments to the recycling standards under section 608 of the Clean Air Act. Many of these standards involve reporting requirements and are not expected to be a high cost issue. Thus, today's rule is not subject to the requirements of sections 202 and 205 of the UMRA.

For the reasons outlined above, EPA has also determined that this rule contains no regulatory requirements that might significantly or uniquely affect small governments. Thus, today's rule is not subject to the requirements of section 203 of the UMRA.

Executive Order 13132, entitled “Federalism” (64 FR 43255 (August 10, 1999)), requires EPA to develop an accountable process to ensure “meaningful and timely input by State and local officials in the development of regulatory policies that have federalism implications.” “Policies that have federalism implications” is defined in the Executive Order to include regulations that have “substantial direct effects 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.”

This direct final rule does not have federalism implications. It will not have substantial direct effects 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, as specified in Executive Order 13132. The regulations promulgated under today's action are done so under Title VI of the Act which does not grant delegation rights to the States. Thus, Executive Order 13132 does not apply to this rule.

Executive Order 13175, entitled “Consultation and Coordination with Indian Tribal Governments” (65 FR 67249 (November 9, 2000)), requires EPA to develop an accountable process to ensure “meaningful and timely input by tribal officials in the development of regulatory policies that have tribal implications.” This direct final rule does not have tribal implications, as specified in Executive Order 13175. Today's rule does not significantly or uniquely affect the communities of Indian tribal governments. Thus, Executive Order 13175 does not apply to this rule.

Executive Order 13045: Protection of Children from Environmental Health & Safety Risks (62 FR 19885 (April 23, 1997)) applies to any rule that: (1) Is determined to be “economically significant” as defined under Executive Order 12866, and (2) concerns an environmental health or safety risk that EPA has reason to believe may have a disproportionate effect on children. If the regulatory action meets both criteria, the Agency must evaluate the environmental health or safety effects of the planned rule on children, and explain why the planned regulation is preferable to other potentially effective and reasonably feasible alternatives considered by the Agency.

This direct final rule is not subject to the Executive Order because it does not concern an environmental health or safety risk that EPA has reason to believe may have a disproportionate effect on children. This rule amends the recycling standards for refrigerants to protect the stratosphere from ozone depletion, which in turn protects human health and the environment from increased amounts of UV radiation.

This rule is not subject to Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355 (May 22, 2001)) because it is not a significant regulatory action under Executive Order 12866.

Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (NTTAA), Public Law 104-113, section 12(d) (15 U.S.C. 272 note) directs EPA to use voluntary consensus standards in its regulatory activities unless to do so would be inconsistent with applicable law or otherwise impractical. Voluntary consensus standards are technical standards (e.g., materials specifications, test methods, sampling procedures, and business practices) that are developed or adopted by voluntary consensus standards bodies. The NTTAA directs EPA to provide Congress, through OMB, explanations when the Agency decides not to use available and applicable voluntary consensus standards. This rulemaking does not involve voluntary consensus standards.

The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the Agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this rule and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register. A major rule cannot take effect until 60 days after it is published in the Federal Register. This action is not a “major rule” as defined by 5 U.S.C. 804(2). It will become effective June 13, 2005.

You may be potentially affected by this action if you are an agricultural producer, food manufacturer or pesticide manufacturer. Potentially affected entities may include, but are not limited to:

• Crop Production/ Agriculture (NAICS 111)

You may be potentially affected by this action if you are an agricultural producer, food manufacturer, or pesticide manufacturer. Potentially affected entities may include, but are not limited to:

• Crop production (NAICS code 111)

• Animal production (NAICS code 112)

• Food manufacturing (NAICS code 311)

• Pesticide manufacturing (NAICS code 32532)

This listing is not intended to be exhaustive, but rather provides a guide for readers regarding entities likely to be affected by this action. Other types of entities not listed in this unit could also be affected. The North American Industrial Classification System (NAICS) codes have been provided to assist you and others in determining whether this action might apply to certain entities. If you have any questions regarding the applicability of this action to a particular entity, consult the person listed under FOR FURTHER INFORMATION CONTACT.

In addition to using EDOCKET (http://www.epa.gov/edocket/), you may access this Federal Register document electronically through the EPA Internet under the “Federal Register” listings at http://www.epa.gov/fedrgstr/. A frequently updated electronic version of 40 CFR part 180 is available at E-CFR Beta Site Two at http://www.gpoaccess.gov/ecfr/. To access the OPPTS Harmonized Guidelines referenced in this document, go directly to the guidelines at http://www.epa.gpo/opptsfrs/home/guidelin.htm/.

In the Federal Register of August 4, 2004 (69 FR 47145) (FRL-7369-6), EPA issued a notice pursuant to section 408(d)(3) of FFDCA, 21 U.S.C. 346a(d)(3), announcing the filing of a pesticide petition (PP 3F6575) by Nippon Soda Company c/o Nisso America, 42 Broadway, Suite 2120, New York, NY 10006. The petition requested that 40 CFR 180.578 be amended by establishing a tolerance for residues of the insecticide acetamiprid, in or on tuberous and corm vegetables at 0.01 parts per million (ppm). That notice included a summary of the petition prepared by Nisso America, Inc.. There were two comments to the Acetamiprid Notice of Filing and they are addressed in Unit IV.D..

Section 408(b)(2)(A)(i) of FFDCA allows EPA to establish a tolerance (the legal limit for a pesticide chemical residue in or on a food) only if EPA determines that the tolerance is “safe.” Section 408(b)(2)(A)(ii) of FFDCA defines “safe” to mean that “there is a reasonable certainty that no harm will result from aggregate exposure to the pesticide chemical residue, including all anticipated dietary exposures and all other exposures for which there is reliable information.” This includes exposure through drinking water and in residential settings, but does not include occupational exposure. Section 408(b)(2)(C) of FFDCA requires EPA to give special consideration to exposure of infants and children to the pesticide chemical residue in establishing a tolerance and to “ensure that there is a reasonable certainty that no harm will result to infants and children from aggregate exposure to the pesticide chemical residue. . . .”

EPA performs a number of analyses to determine the risks from aggregate exposure to pesticide residues. For further discussion of the regulatory requirements of section 408 of FFDCA and a complete description of the risk assessment process, see the final rule on Bifenthrin Pesticide Tolerances (62 FR 62961, November 26, 1997) (FRL-5754-7).

Consistent with section 408(b)(2)(D) of FFDCA, EPA has reviewed the available scientific data and other relevant information in support of this action. EPA has sufficient data to assess the hazards of and to make a determination on aggregate exposure, consistent with section 408(b)(2) of FFDCA, for a tolerance for residues of acetamiprid on tuberous and corm vegetables at 0.01 ppm. EPA's assessment of exposures and risks associated with establishing the tolerance follows.

EPA has evaluated the available toxicity data and considered its validity, completeness, and reliability as well as the relationship of the results of the studies to human risk. EPA has also considered available information concerning the variability of the sensitivities of major identifiable subgroups of consumers, including infants and children. The nature of the toxic effects caused by acetamiprid are discussed in Table 1 of this unit as well as the no-observed-adverse-effect-level (NOAEL) and the lowest-observed-adverse-effect-level (LOAEL) from the toxicity studies reviewed.

The dose at which no adverse effects are observed (the NOAEL) from the toxicology study identified as appropriate for use in risk assessment is used to estimate the toxicological level of concern (LOC). However, the lowest dose at which adverse effects of concern are identified (the LOAEL) is sometimes used for risk assessment if no NOAEL was achieved in the toxicology study selected. An uncertainty factor (UF) is applied to reflect uncertainties inherent in the extrapolation from laboratory animal data to humans and in the variations in sensitivity among members of the human population as well as other unknowns. An UF of 100 is routinely used, 10X to account for interspecies differences and 10X for intraspecies differences.

Three other types of safety or uncertainty factors may be used: “Traditional uncertainty factors;” the “ special FQPA safety factor;” and the “default FQPA safety factor.” By the term “traditional uncertainty factor,” EPA is referring to those additional uncertainty factors used prior to FQPA passage to account for database deficiencies. These traditional uncertainty factors have been incorporated by the FQPA into the additional safety factor for the protection of infants and children. The term “special FQPA safety factor” refers to those safety factors that are deemed necessary for the protection of infants and children primarily as a result of the FQPA. The “default FQPA safety factor” is the additional 10X safety factor that is mandated by the statute unless it is decided that there are reliable data to choose a different additional factor (potentially a traditional uncertainty factor or a special FQPA safety factor).

For dietary risk assessment (other than cancer) the Agency uses the UF to calculate an acute or chronic reference dose (acute RfD or chronic RfD) where the RfD is equal to the NOAEL divided by an UF of 100 to account for interspecies and intraspecies differences and any traditional uncertainty factors deemed appropriate (RfD = NOAEL/UF). Where a special FQPA safety factor or the default FQPA safety factor is used, this additional factor is applied to the RfD by dividing the RfD by such additional factor. The acute or chronic Population Adjusted Dose (aPAD or cPAD) is a modification of the RfD to accommodate this type of safety factor.

For non-dietary risk assessments (other than cancer) the UF is used to determine the LOC. For example, when 100 is the appropriate UF (10X to account for interspecies differences and 10X for intraspecies differences) the LOC is 100. To estimate risk, a ratio of the NOAEL to exposures (margin of exposure (MOE) = NOAEL/exposure) is calculated and compared to the LOC.

The linear default risk methodology (Q*) is the primary method currently used by the Agency to quantify carcinogenic risk. The Q* approach assumes that any amount of exposure will lead to some degree of cancer risk. A Q* is calculated and used to estimate risk which represents a probability of occurrence of additional cancer cases (e.g., risk). An example of how such a probability risk is expressed would be to describe the risk as one in one hundred thousand (1 X 10- 5), one in a million (1 X 10- 6), or one in ten million (1 X 10- 7). Under certain specific circumstances, MOE calculations will be used for the carcinogenic risk assessment. In this non-linear approach, a “point of departure” is identified below which carcinogenic effects are not expected. The point of departure is typically a NOAEL based on an endpoint related to cancer effects though it may be a different value derived from the dose response curve. To estimate risk, a ratio of the point of departure to exposure (MOEcancer = point of departure/exposures) is calculated.

A summary of the toxicological endpoints for acetamiprid used for human risk assessment is shown in Table 2 of this unit:

1. Dietary exposure from food and feed uses. Tolerances have been established (40 CFR 180.578) for the residues of acetamiprid, in or on a variety of raw agricultural commodities. Risk assessments were conducted by EPA to assess dietary exposures from acetamiprid in food as follows:

i. Acute exposure. Acute dietary risk assessments are performed for a food-use pesticide, if a toxicological study has indicated the possibility of an effect of concern occurring as a result of a 1-day or single exposure.

In conducting the acute dietary risk assessment EPA used the Dietary Exposure Evaluation Model software with the Food Commodity Intake Database (DEEM-FCIDTM version 1.3), which incorporates food consumption data as reported by respondents in the USDA 1994-1996 and 1998 Nationwide Continuing Surveys of Food Intake by Individuals (CSFII), and accumulated exposure to the chemical for each commodity. The assumptions made for the acute exposure assessments are discussed in Unit III.C.1.ii.

ii. Chronic exposure. In conducting the chronic dietary risk assessment EPA used the DEEM-FCIDTM, which incorporates food consumption data as reported by respondents in the USDA 1994-1996 and 1998 CSFII, and accumulated exposure to the chemical for each commodity. The following assumptions were made for the chronic exposure assessments:

For both the acute and chronic analyses, tolerance-level residues were assumed for all food commodities with current and proposed acetamiprid tolerances, and it was assumed that all of the crops included in the analysis were treated (i.e., 100% crop treated). These assumptions result in highly conservative estimates of dietary exposure and risk. In calculating dietary risk estimates, the Agency has compared the acute and chronic population-adjusted doses (aPAD, cPAD) to the estimated dietary exposures from the models. Typically, the Agency has concerns regarding dietary risk when the exposure estimates exceed 100% of the aPAD and/or cPAD. Even with the conservative assumptions noted above, risk estimates associated with dietary exposure to acetamiprid are below the Agency's LOC.

iii. Cancer. Acetamiprid has been classified as not likely to be carcinogenic to humans; therefore, a dietary assessment for cancer risk was not conducted. This classification is based on the absence of a dose-response and a lack of a statistically significant increase in the mammary adenocarcinoma incidence by pair-wise comparison of the mid- and high-dose groups with the controls. Although the incidence exceeded the historical control data from the same lab, it was within the range of values from the supplier.

2. Dietary exposure from drinking water. The Agency lacks sufficient monitoring exposure data to complete a comprehensive dietary exposure analysis and risk assessment for acetamiprid in drinking water. Because the Agency does not have comprehensive monitoring data, drinking water concentration estimates are made by reliance on simulation or modeling taking into account data on the physical characteristics of acetamiprid.

Tier 1 simulated estimated drinking water concentrations (EDWCs) for acetamiprid in surface water using the FQPA Index Resevoir Screening Test (FIRST) to calculate surface water concentrations and screening concentration in ground water (SCI-GROW) to calculate ground water concentrations.

For the surface water assessment, the application rate for citrus was used, which represents the highest label rate for a single application of any crop (0.55 lb a.i./A/season). However, it is important to note that due to limitations imposed by the use of two applications at the highest single application rate (0.25 lb a.i./A), the modeled application rate was equal to only 0.50 lb a.i./A.

The proposed applications of acetamiprid on tuberous and corm vegetables would result in lower EDWCs than citrus, and thus has little effect on the drinking water assessment for this chemical. By using the application rate for citrus crops, the surface and ground water estimated concentrations are conservative estimates for the proposed new use scenarios (tuberous and corm vegetables) because of the higher application rate.

The primary use of these models by the Agency at this stage is to provide a screen for sorting out pesticides for which it is unlikely that drinking water concentrations would exceed human health levels of concern.

Since the models used are considered to be screening tools in the risk assessment process, the Agency does not use estimated environmental concentrations (EECs), which are the model estimates of a pesticide's concentration in water. EECs derived from these models are used to quantify drinking water exposure and risk as a %RfD or %PAD. Instead drinking water levels of comparison (DWLOCs) are calculated and used as a point of comparison against the model estimates of a pesticide's concentration in water. DWLOCs are theoretical upper limits on a pesticide's concentration in drinking water in light of total aggregate exposure to a pesticide in food, and from residential uses. Since DWLOCs address total aggregate exposure to acetamiprid they are further discussed in the aggregate risk sections.

This is a summary of the Commission's Report and Order portion (Report and Order) of the Commission's Report and Order and Notice of Proposed Rulemaking, FCC 04-287, in WT Docket Nos. 03-103 and 05-42, adopted December 15, 2004, and released February 22, 2005. Contemporaneous with this document, the Commission publishes a Notice of Proposed Rulemaking (Notice) (summarized elsewhere in this publication). The full text of this document is available for public inspection and copying during regular business hours at the FCC Reference Information Center, 445 12th St., SW., Room CY-A257, Washington, DC 20554. The complete text may be purchased from the Commission's duplicating contractor: Best Copy & Printing, Inc., 445 12th Street, SW., Room CY-B402, Washington, DC 20554, telephone 800-378-3160, facsimile 202-488-5563, or via e-mail at fcc@bcpiweb.com. The full text may also be downloaded 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 or at Brian.Millin@fcc.gov.

1. The Commission initiated this proceeding, inter alia, to reexamine the 800 MHz Air-Ground Radiotelephone Service band plan and service rules. Although the Commission initially licensed six 800 MHz air-ground nationwide licensees, only one licensee (Verizon Airfone) continues to provide service in the band, and our current technical rules allow it to provide only a limited range of narrowband voice and data services. This circumstance led us to question in the Notice of Proposed Rulemaking in this proceeding, 68 FR 44003, July 25, 2003, whether our existing rules were impeding the provision of telecommunications services desired by the public onboard aircraft. Nearly all parties commenting on these issues agree that our existing band plan and rules have hindered the efficient, competitive provision of air-ground services desired by the public. Based on our review of the record in this proceeding, we find that the public interest will be served by adopting flexible rules that will enable interested parties to bid on licenses in three possible band configurations. Each of the three band configurations includes at least one spectrum block that will permit the provision of high-speed telecommunications services to the public onboard aircraft.

2. In reexamining the current band plan and service rules, we must address both competitive issues (i.e., how many competitors can the spectrum and the market support) and technical considerations (i.e., how much spectrum is necessary to efficiently and effectively support a range of air-ground service offerings, including voice and broadband applications, and the technical parameters to minimize the potential for air-ground systems to cause interference). We resolve these interrelated issues by adopting flexible rules to determine the best technological configuration of the band and the number of competitors for air-ground communications over multiple platforms (i.e., terrestrial and satellite). We find that reconfiguration of the 800 MHz air-ground band will facilitate competition with satellite-based offerings in the provision of high-speed air-ground services to commercial and other aircraft. We also note that other spectrum is available for the provision of air-ground communications services. Based on our review of the record developed in this proceeding and for the reasons stated below, we conclude that a flexible licensing approach coupled with flexible technical and operational rules will promote the highest valued use of the 800 MHz air-ground spectrum for the provision of air-ground services that better meet the needs of the public.

3. In 1990, the Commission allocated four megahertz of spectrum for commercial Air-Ground Radiotelephone Service, authorizing operation at 849-851 MHz (ground stations) and 894-896 MHz (airborne mobile stations). Each band was divided into ten paired channel blocks, which are allotted to specific geographic locations (essentially a national grid). Each channel block contains 29 narrowband (6 kHz) communications channels and 6 very narrowband (3.2 kHz) control channels. Under the current service rules, each licensee has an exclusive control channel, shares all the communication channels with the other licensees in the band, and must provide nationwide service. To promote interoperable communications and to manage interference, some of the ground station locations in North America and channel block assignments have been predetermined consistent with bilateral agreements with Mexico and with Canada. The number of communications channels limits the number of voice calls that can be simultaneously handled in a particular area, and the narrow bandwidth of these channels limits a service provider to voice and low-speed data services.

4. The current 800 MHz Air-Ground Radiotelephone Service rules contemplate six competing licensees providing voice and low-speed data services. Six entities were originally licensed under these rules, which required all systems to conform to detailed technical specifications to enable shared use of the air-ground channels. Only three of the six licensees built systems and provided service, and two of those failed for business reasons. Only Verizon Airfone remains as an incumbent in the band. The prescriptive command-and-control nature of the current air-ground service rules, the regulatory requirement to share only four megahertz of spectrum among up to six licensees, and the limited data capacity of the narrow bandwidth (6 kHz) communications (slow dial-up modem speed) preclude the provision of broadband services to the public onboard aircraft.

5. There is substantial and rapidly growing consumer, airline, and service provider interest in access to high-speed Internet and other wireless services onboard aircraft. Market research suggests that many frequent flyers are willing to pay for high-speed access to the Internet and their corporate network.

6. We have reviewed the extensive record in this proceeding and conclude that the public interest will be served by adopting a flexible framework that will enable interested parties to bid on spectrum licenses according to the band configuration that they believe will best meet their needs for the provision of air-ground services. Interested parties may bid on spectrum licenses in any of the following three band plans, including two overlapping, shared, cross-polarized spectrum licenses (band plan 1) as advocated by AirCell, Inc. and the Boeing Company and exclusive spectrum licenses (band plans 2 and 3) as proposed by Space Data Corporation and Verizon Airfone. Licenses will have a ten-year term.

Band plan 1—two overlapping, shared, cross-polarized 3 MHz licenses (licenses A and B, respectively).

Band plan 2—an exclusive 3 MHz license and an exclusive 1 MHz license (licenses C and D, respectively).

Band plan 3—an exclusive 1 MHz license and an exclusive 3 MHz license (licenses E and F, respectively), with the blocks at opposite ends of the band from the second configuration.

7. The Commission will award licenses to winning bidders for the licenses comprising the band plan that receives the highest aggregate gross bid, subject to long-form license application review. In order to further competition and ensure maximum use of this frequency band for air-ground services, no party will be eligible to hold more than one of the spectrum licenses being made available.

8. We believe this flexible approach to configuration of the band will promote our goal in this proceeding of facilitating the highest valued use of this scarce spectrum resource, resulting in the provision of wireless communications services that better meet the needs of the traveling public onboard aircraft. We also further our strategic objective to encourage the growth and rapid deployment of innovative and efficient communications technologies and services by adopting rules that will permit licensees to deploy any current or future technology with an occupied bandwidth that fits within its assigned spectrum and to provide any kind of air-ground service to any type of aircraft. As explained below, we also provide a transition period for the incumbent system currently operated by Verizon Airfone.

9. Future licensees in the 800 MHz air-ground band, as well as other interested parties, will have the opportunity to engage in spectrum leasing under our rules. Future licensees will also be permitted to engage in partitioning and/or disaggregation of their licenses. These regulatory opportunities are intended to provide the air-ground marketplace greater flexibility to respond to consumer demand.

10. Below, we address the location of ground stations, the provision of deck-to-deck service (i.e., service from takeoff to landing), competitive considerations, and the provision of services in the air-ground band.

11. Band plans 2 and 3 provide for exclusive spectrum licensing and will afford new licensees significant flexibility to configure and modify their systems to address current and future market conditions. For example, licensees will be able to initially configure their systems to best meet the needs of their customers, and may flexibly reconfigure or add ground stations to respond to future demand for air-ground services. An exclusive licensee also could deploy new technologies in response to changing market conditions—without having to coordinate its choice of technology with another licensee in the band. If the band is comprised of two overlapping 3 MHz licenses (band plan 1), the new licensees will be required to jointly file a spectrum sharing and site selection plan with the Wireless Telecommunications Bureau within six months of the initial grant of their spectrum licenses and will be required to notify the Bureau of any changes to the plan. The Wireless Telecommunications Bureau will issue a public notice prior to the Commission's auction of new 800 MHz air-ground spectrum licenses in which it will specify the filing requirements for the plan. This approach would provide parties with overlapping spectrum licenses flexibility to configure their systems without having to adhere to minimum spacing requirements or site locations dictated by the Commission.

12. The record reflects that parties desire deck-to-deck service (i.e., service from terminal to terminal). We note that air-ground communications services are currently provided to Federal, State, and local agencies, including the FBI, the U.S. Department of Energy, and the U.S. Customs Service, and that the air-ground spectrum can be used to support aircraft management, other public safety services, and homeland security communications. In view of the foregoing and in light of our statutory mandate to promote the safety of life and property, we have selected three band plans that would enable licensees to provide deck-to-deck service.

13. An exclusive licensing approach (band plans 2 and 3) would facilitate the provision of service continuously because ground stations can be located without inter-system coordination and would not have to be limited in power or sector orientation by the presence of an overlapping licensee. If a spectrum sharing approach (band plan 1) is selected by the auction winners, the record indicates that the parties will have to agree on power limits and sharing rules to facilitate the full provision of deck-to-deck service.

14. The flexible band configuration approach that we adopt today will enable interested parties to bid on overlapping spectrum licenses (band plan 1) in the event that they believe spectrum sharing will best meet their needs for the provision of air-ground services. Under this approach, the individual licensees—rather than the Commission—would determine the criteria for ground station locations and other technical requirements necessary to facilitate the provision of broadband services on an overlapped basis. Moreover, in lieu of codifying their sharing plan into the Commission's rules, any sharing plan that the winning bidders develop between themselves can be modified at any time without their having to seek a change in the rules. If band plan 1 is implemented, we expect the parties to engage in good faith negotiations in developing and implementing their spectrum sharing plan. If the two licensees cannot agree on a spectrum sharing plan or if a dispute arises under their initial or amended agreement, we would encourage them to use binding arbitration or other alternative dispute resolution procedures. Alternatively, either party may request that the Commission resolve major disputes by filing, for example, a petition for declaratory ruling.

15. In developing the available band plan options, we have considered the potential harms and benefits that may accrue from the possibility of a single provider in this band versus opportunities for multiple service providers. We have also weighed the possible harms and benefits in the context of our goal in this proceeding of facilitating the highest valued use of this spectrum, resulting in the provision of wireless telecommunications services onboard aircraft that better meet the needs of the traveling public. We have considered not only the existence of emerging satellite-based competition but also the availability of other spectrum for the provision of air-ground service. In addition, we have taken into account the fact that our new air-ground band plan and rules will provide an adequate amount of spectrum for the provision of new high-speed wireless services using the 800 MHz air-ground spectrum that cannot be provided under our current rules, and we anticipate that any future provider will take advantage of the new rules to provide services that will compete more directly with broadband air-ground providers operating from different platforms. Therefore, we find that the air-ground band plan and the flexible service rules that we adopt today are likely to enhance intermodal air-ground competition even if ultimately only one entity operates in the 800 MHz air-ground band.

16. Nevertheless, in light of the very limited amount of spectrum (four megahertz) available in the 800 MHz air-ground band, we conclude that the public interest would be served by ensuring access to this spectrum by more than one entrant by prohibiting any single party from controlling more than three megahertz of spectrum in the band. Although other spectrum and platforms will be available for the provision of domestic air-ground service, the 800 MHz air-ground band constitutes the only four megahertz of spectrum dedicated specifically to the commercial air-ground service in the United States. Thus, there is currently no guarantee that any spectrum other than the 800 MHz air-ground band and the spectrum used by satellite services will in fact be used for commercial air-ground service. We accordingly conclude that it is in the public interest to promote competition by ensuring that at least two parties will have an opportunity to provide service in the 800 MHz air-ground band. Other providers will be able to access the spectrum through secondary markets, resale or similar means. In addition, the record demonstrates that no more than three megahertz of spectrum is required to deliver high-speed air-ground services using today's broadband technologies. Permitting one party to control the entire four megahertz of spectrum comprising the band therefore could result in one megahertz of spectrum (25 percent of the band) lying fallow, which would undermine our goal of promoting the highest valued use of this spectrum. A 1 MHz spectrum block could support such applications as email service, Internet access, messaging services, avionic support, and homeland security services. Given the many potential uses of a 1 MHz spectrum block, restricting the access of any single party to three megahertz of the spectrum not only will increase the air-ground service choices available to consumers, but also will ensure the efficient use of this spectrum. We also believe that promoting competition in the band and with satellite-based service providers will serve the public interest by spurring technological innovation. In light of these findings, we conclude that it is in the public interest to have two licensees in this band.

17. In view of the foregoing, we will prohibit any party from obtaining a controlling interest, either at auction or by a post-auction transaction, in more than three megahertz of spectrum (either shared or exclusive) in the 800 MHz air-ground band. Each of the three band configurations contains two licenses and each includes at least one 3 MHz license. Accordingly, no party may have a controlling interest in more than one license in the band plan implemented as a result of the Commission's auction of new air-ground licenses. For purposes of this eligibility restriction, individuals and entities with either de jure or de facto control of a licensee in the band will be considered to have a controlling interest in the licensee. De jure control is evidenced by holdings of greater than 50 percent of the voting stock of a corporation, or in the case of a partnership, general partnership interests. De facto control is determined on a case-by-case basis.

18. We also will apply the definitions of “controlling interests” and “affiliate” currently set forth in §§ 1.2110(c)(2) and 1.2110(c)(5) of the Commission's rules. These provisions have worked well to identify individuals and entities that have the ability to control applicants for Commission licenses and therefore are well-suited to our goal here of ensuring that no party will hold a controlling interest in more than three megahertz of spectrum (shared or exclusive) in the 800 MHz air-ground band. We note that § 1.2110(c)(2) includes the requirement that ownership interests generally be calculated on a fully diluted basis, and also provides that any person who manages the operations of an applicant pursuant to a management agreement, or enters into a joint marketing agreement with an applicant, shall be considered to have a controlling interest in the applicant if such person, or its affiliate, has authority to make decisions or otherwise engage in practices or activities that determine, or significantly influence, the types of services offered, or the terms or prices of such services. We find that, together with the other provisions of §§ 1.2110(c)(2) and 1.2110(c)(5), these provisions will ensure that no entity will hold a controlling interest in more than three megahertz of spectrum (shared or exclusive) in the 800 MHz air-ground band.

19. We note that, like other Part 22 licensees, 800 MHz Air-Ground Radiotelephone Service licensees are classified as commercial mobile radio service (CMRS) providers and thus are subject to common carrier regulation under Title II of the Communications Act (Act). While the Commission has previously decided to forbear from applying certain provisions of Title II to CMRS providers, it has determined that it would be inappropriate to exempt CMRS providers from the competitive safeguards embodied in §§ 201 and 202 of the Act. Air-Ground licensees therefore are required to provide service upon reasonable request, and their “charges, practices, classifications, and regulations for and in connection with” service must be just and reasonable. Moreover, Air-Ground licensees may not make any unjust or unreasonable discrimination in charges, practices, classifications, regulations, facilities, or services for or in connection with a like communication service and may not afford any undue or unreasonable preference or advantage to any person or class of persons. Accordingly, if an air-ground licensee were to unreasonably discriminate in its service rates, terms, or conditions, it could be subject to enforcement action by the Commission as well as a complaint proceeding initiated pursuant to § 208 of the Act.

20. A new licensee may provide any type of air-ground service (i.e., voice telephony, broadband Internet, data, etc.) to aircraft of any type, and serve any or all aviation markets (e.g., commercial, government, and general). A licensee must provide service to aircraft. We note that current bilateral agreements between the United States, Canada, and Mexico provide for coordinated use of air-ground frequencies over North American airspace and are based on a narrow bandwidth channel scheme, and therefore may need to be renegotiated to provide for more flexible use of this spectrum.

21. At this time, we decide not to permit a licensee to provide ancillary land mobile or fixed services in the 800 MHz air-ground spectrum.

22. We are adopting the minimal set of technical rules for the new air-ground service necessary to implement the three alternative band plan configurations that will be subject to auction. Generally, these rules provide licensees flexibility to deploy any type of transmission technology, provided that the radio emissions produced fit within a licensee's assigned spectrum. The new technical rules limit only transmitting power and the power level of unwanted emissions. As a general matter, these new technical rules are crafted to allow sufficient power to provide robust air-ground services, while limiting the potential for harmful interference to services operating in adjacent spectrum.

23. Interference to air-ground from adjacent services. Each of the two paired bands comprising the 800 MHz air-ground allocation is adjacent to and just above spectrum allocated to the cellular radiotelephone service. The 849-851 MHz uplink band is adjacent to and just below spectrum allocated to land mobile services including public safety, which will soon become all public safety pursuant to the 800 MHz Order. The 894-896 MHz downlink band is adjacent to and just below spectrum allocated to land mobile services including 900 MHz SMR. These services are heavily used in many areas. Base stations in these adjacent services are authorized to utilize high power levels.

24. The services adjacent to the 849-851 MHz band are subject to rules that limit their potential to cause interference to air-ground service. We do not, at this time, find a need to adopt additional or more stringent rules applicable to the adjacent service licensees to further limit interference potential to the air-ground service. We believe that, under the current rules, new air-ground systems should be able, through careful ground station site selection and technical coordination with the licensees in the adjacent services, to build out their systems. Potential licensees should plan on obtaining qualified engineering advice regarding system design and ground station site selection, taking fully into account the existing radio frequency environment at candidate sites.

25. Interference to Cellular Block B. The air-ground ground station transmit band at 849-851 MHz is adjacent to the Cellular Radiotelephone Service Block B band, which is used for cellular base station receivers. We note that no harmful interference problems between the cellular service and the commercial air-ground service have been reported to the Commission during more than ten years of air-ground service operations, despite the fact that the air-ground mobile station and ground station transmit bands are reversed from the adjacent cellular bands. We believe that several factors may explain why there have been no reported interference problems. First, both services have out of band emissions (OOBE) limits to suppress undesired signals from adjacent allocations. Second, there are far fewer ground stations in an air-ground system than in a cellular system (e.g., the entire U.S. airspace can be covered at an altitude of 20,000 feet by fewer than 200 ground stations). Third, an air-ground licensee must employ careful site selection practices for its ground stations, including an unobstructed view of the sky and consideration of the local RF environment (i.e., what other stations are nearby). Further, air-ground antennas also are typically up-tilted whereas cellular antennas are often down-tilted, adding some isolation between the two. The rule changes that we adopt to permit broadband air-ground services will not alter any of these factors and, consequently, we expect that these factors will be effective in avoiding inter-service interference under our new air-ground band plan.

26. Furthermore, we do not believe that the use of wider bandwidth technologies in the 800 MHz air-ground spectrum will result in increased interference between air-ground operations and cellular operations. Although spread spectrum emissions typically have broader out-of-band noise skirts, the level of this noise is subject to the Commission's OOBE rules. We also note that the broadband spread spectrum based technologies used in the cellular band and those that the parties have proposed for use in the air-ground band are resistant to small amounts of out-of-band noise. In summary, we find that applying our standard OOBE rules here is adequate to limit unwanted emissions between ground stations in the air-ground service and base stations in the cellular service. We note that our standard OOBE rules also provide that the Commission may require greater attenuation of unwanted emissions in the event it is necessary to prevent interference to other services.

27. The airborne mobile transmit band (894-896 MHz) is adjacent on its lower side to the cellular telephone receivers of the Cellular B Block licensee. There have been no reported instances of harmful interference between airborne mobile stations and cellular telephones. This stems from the large distance separation between aircraft and cellular phones on the ground, and our decision today does not change this factor. We conclude that our OOBE limits and the distance separation make it likely that the mobile units in these two services will continue to operate in adjacent spectrum without harmful interference problems. Nevertheless, if an air-ground licensee elects to operate aircraft mobile transmitters on the ground or during approach and take-off, they may find it necessary in some cases to provide additional attenuation of OOBE falling into the spectrum below 894 MHz, in order to avoid interference to cellular phones in use in the immediate vicinity of airports.

28. Interference to Public Safety. The upper edge of the air-ground ground station transmit band at 849-851 MHz is adjacent to what are now mobile receivers for interleaved business, industrial and land transportation, SMR, and public safety radio channels, but which will soon become the National Public Safety Plan Advisory Committee (NPSPAC) public safety channels pursuant to our recent 800 MHz Order, 69 FR 67823, November 22, 2004. Nextel asserts that OOBE from air-ground ground stations could produce a significant amount of noise energy in nearby public safety receivers. Although we have found that emissions from cellular base stations may have contributed to interference problems with public safety and critical infrastructure mobile receivers above 851 MHz, there is no history of similar interference being caused by the existing air-ground ground stations to mobile receivers. There are again several factors that we believe may explain why air-ground caused interference is rare, including the fact that there are so few air-ground ground stations, as compared to cellular base stations, and the deployment characteristics of ground stations (e.g., up tilted antennas). Further, we note that NPSPAC operations above 851 MHz will be protected by our OOBE limit rule, including the provision that allows the Commission to require greater attenuation if necessary to prevent interference.

29. Nevertheless, we believe that it is prudent to adopt a rule providing that ground stations in the Air-Ground Radiotelephone Service that operate in the 849-851 MHz range will be subject to the same interference abatement obligation rules adopted for cellular services in the 800 MHz Order. The rule we are adopting is essentially the same as that adopted for cellular in the 800 MHz Order. We will not require air-ground licensees to participate in the establishment of the electronic notification process because we anticipate that this process will be in place by the time that new air-ground licenses are issued.

30. Interference to 900 MHz SMR base receivers. The airborne mobile transmit band (894-896 MHz) is adjacent on its upper side to the base station receive band in the 900 MHz SMR service. Distance separation will normally serve to protect 900 MHz SMR base station receivers because airborne stations normally operate at altitudes well above 900 MHz SMR base stations. Nextel, however, contends that there may be a problem where its 900 MHz SMR base stations are located near airport runways, and if there are several aircraft at low altitude nearby at the same time. This possibility appears to be atypical and we find that it would be best addressed on a case-by-case basis rather than by a broad-based rule. Air-ground licensees and 900 MHz SMR licensees should cooperate to resolve any interference problems of this type.

31. Miscellaneous interference issues. We do not believe the record justifies adoption of more stringent OOBE limits for the Air-Ground Radiotelephone Service. Accordingly, we will apply our harmonized flexible OOBE limits rule, which currently applies to cellular and broadband PCS, to the 800 MHz Air-Ground Radiotelephone Service. We note that, in the event that band plan 2 or 3 is implemented, the exclusive licensees would be subject to the OOBE standards between their spectrum blocks, as well as outside the air-ground band.

32. Miscellaneous technical rules. The existing air-ground rules have provided particular limits on transmitter frequency tolerance and specifications for automated operating procedures. We conclude it is unnecessary to retain such a detailed frequency tolerance rule. Under the legacy band configuration, numerous closely packed air-ground channels were shared by multiple licensees, so we required a frequency tolerance rule that tightly controlled frequency stability to minimize the possibility of adjacent channel interference. By contrast, our new rules establish wider spectrum blocks and we anticipate fewer communications channels. In addition, we expect that the advanced technologies likely to be used in this band will have to be inherently stable in order to work properly, and, in the Air-Ground Radiotelephone Service, possibly to compensate for Doppler shift as well. Thus, we find that we need only require in our rules that the frequency stability of equipment used be sufficient to ensure that, after accounting for Doppler frequency shifts, the occupied bandwidth of the fundamental emissions remains within the authorized frequency bands of operation. In the event that band plan 1 is implemented and licenses for spectrum sharing are issued, the licensees may choose to agree upon any number of miscellaneous technical standards that may be needed to facilitate shared spectrum operation and include them in the spectrum sharing plan that they would file with the Wireless Telecommunications Bureau.

33. Verizon Airfone Inc. is the sole incumbent currently operating in the 800 MHz air-ground band. In April 2004, the company filed an application for renewal of its authorization to operate in the band, Call Sign KNKG804. We grant Verizon Airfone Inc. a non-renewable license for a five-year term commencing on the effective date of this Report and Order.

34. In order to ensure that the air-ground spectrum can be used to provide broadband air-ground services to the public in the near future, it is imperative to clear the incumbent narrowband system from a minimum of three megahertz of spectrum as soon as reasonably practicable. We conclude that, given the declining and relatively low usage level of Verizon Airfone's system, and because the original 800 MHz air-ground band plan was intended to accommodate six competing licensees, the existing system can be provided comparable spectrum in one megahertz of spectrum in the air ground band.

35. Verizon Airfone's incumbent system must cease operations in the lower 1.5 MHz portion of each 2 MHz air-ground band within 24 months of the initial date of grant of any license, if band plan 1 or 2 is implemented; Verizon Airfone may relocate its incumbent operations to the upper 0.5 MHz portion of each 2 MHz band and may continue to operate under the renewal authorization until the end of the five-year license term. If band plan 3 is implemented, Verizon Airfone's incumbent system must cease operations in the upper 1.5 MHz portion of each 2 MHz air-ground band within 24 months of the initial date of grant of any new license; Verizon Airfone may relocate its incumbent operations to the lower 0.5 MHz portion of each 2 MHz band and may continue to operate under the renewal authorization until the end of the five-year license term. We note that this transition period is consistent with Verizon Airfone's request that we provide it a “limited transitional period” for its narrowband system. In revising our current air-ground rules, we are eliminating all of the command and control technical rules, which enabled dynamic sharing of communication channels under the former licensing scheme. Verizon Airfone may reconfigure the narrowband channelization of its existing system in the upper 0.5 MHz portion of each 2 MHz band (or lower 0.5 MHz portion of each band if band plan 3 is implemented) any way it wants, including using control channel(s) of any authorized bandwidth less than 6 kHz (not limited to 3.2 kHz as they are now). We note that if Verizon Airfone acquires a new spectrum authorization as a result of competitive bidding, it could elect to continue its incumbent operations under such new authorization.

36. We conclude that it would not be inequitable for Verizon Airfone to bear costs associated with relocating its narrowband operations within the 24-month period set out above to accommodate a new entrant in the air-ground band. The original 800 MHz air-ground band plan was intended to accommodate six competing licensees in the air-ground band, and Verizon Airfone has never had a right to exclusive use of the band. The new license that we grant Verizon Airfone today, moreover, provides the company a substantial period—two years from the initial grant of any new air-ground license—to relocate its narrowband operations to one megahertz of spectrum in the band.

37. We do not foresee harm to the flying public flowing from Verizon Airfone bearing any relocation expenses it may have. As noted above, demand for Verizon Airfone's service has markedly declined in recent years, and the company's system is approaching technological obsolescence. We note that a new air-ground licensee could seek to negotiate and compensate Verizon Airfone to relocate earlier than required by the terms of Verizon Airfone's new license; Verizon Airfone, however, will not be obligated to engage in such negotiations. On balance, we conclude that any burden that might be incurred by Verizon Airfone to relocate its operations under the conditions we are adopting should be minimal. Accordingly, we require Verizon Airfone to bear any costs for relocating its narrowband operations in the air-ground band at the end of the 24-month transition period.

38. We hereby grant Verizon Airfone Inc. a non-renewable license, Call Sign KNKG804, for a five-year term subject to the following conditions:

• If band plan 1 or 2 is implemented, Verizon Airfone must cease its existing narrowband operations in the lower 1.5 MHz portion of each 2 MHz air-ground band within 24 months of the initial date of grant of a new spectrum license.

• If band plan 1 or 2 is implemented, Verizon Airfone may relocate its incumbent operations to the upper 0.5 MHz portion of each 2 MHz band (0.5 MHz at 850.500-851.000 MHz paired with 0.5 MHz at 895.500-896.000 MHz).

• If band plan 3 is implemented, Verizon Airfone must cease its existing narrowband operations in the upper 1.5 MHz portion of each 2 MHz air-ground band within 24 months of the initial date of grant of a new spectrum license.

• If band plan 3 is implemented, Verizon Airfone may relocate its incumbent operations to the lower 0.5 MHz portion of each 2 MHz band (0.5 MHz at 849.000-849.500 MHz paired with 0.5 MHz at 894.000-894.500 MHz).

• The existing § 22.867 power limits for ground stations (100 Watts ERP) and airborne mobile stations (30 Watts ERP) will become license terms. We are amending § 22.867 and it will apply to the new licensees only.

• The existing § 22.861 out-of-band and spurious emission limits will become license terms. We are amending § 22.861 and it will apply to the new licensees only.

• The authorized emission bandwidth of any transmission from the existing system may not exceed 6 kHz. This license condition replaces § 22.857(a)(2) because we are removing § 22.857. This condition requires that the existing system remain a narrowband system.

39. Verizon Airfone must coordinate any technical changes within 885 kilometers (550 miles) of the U.S.-Canadian or U.S.-Mexican borders with the appropriate air-ground licensees in those countries prior to requesting appropriate governmental approval. Verizon Airfone may locate or relocate ground stations operating at any power level (not exceeding 100 Watts), subject only to international coordination. Verizon Airfone must maintain and provide to the FCC and the new 800 MHz air-ground licensee(s) a current list of the locations and channels used at all ground stations, which will enable the licensee(s) to provide interference protection to the existing system's operations.

40. During the period that the existing system continues to operate and provide service, the licensee of a new spectrum license must not cause harmful interference to it. Protection from interference requires that the signals of the new licensee(s) must not exceed the current adjacent channel emission limit, which is a ground station received power of -130 dBm in 6 kHz, assuming a 0 dBi vertically polarized antenna. This limit will provide full interference protection to the existing system.

41. We find that a five-year substantial service construction requirement for any new spectrum license—other than the 1 MHz spectrum licenses D and E—will serve the public interest and is consistent with our statutory mandate to prevent stockpiling or warehousing by licensees, and to promote investment in and rapid deployment of new technologies and services. At the end of the five-year construction period, a licensee must provide substantial service to aircraft. We define substantial service as service that is sound, favorable, and substantially above a level of mediocre service that would barely warrant renewal. We establish two safe harbors that would satisfy this substantial service obligation. First, construction and operation of 20 base stations, with at least one base station in each of the ten FAA regions, at the five-year benchmark would constitute substantial service. Alternatively, the construction and operation of base stations capable of serving the airspace of at least 25 of the 50 busiest airports (as measured by annual passenger boardings) at the five-year benchmark would constitute substantial service.

42. We do not establish a construction requirement for spectrum licenses D and E. If either of these licenses is acquired, the licensee would have to share spectrum with Verizon Airfone's incumbent system until the expiration of Verizon Airfone's non-renewable license term. Depending on system configuration, a licensee of spectrum block D or E might not find it technically desirable to operate an air-ground system while sharing spectrum with the incumbent system. Under these circumstances, a construction requirement could result in a licensee deploying a less than optimal system.

43. The general aviation air-ground service operates in the 454.675-454.975 and 459.675-459.975 MHz bands and involves the provision of telecommunications service to private aircraft such as small single engine craft and corporate jets. As explained by one of the commenters in this proceeding, the channels licensed in this service are used for emergency and other purposes. These channels are interconnected with the public switched telephone network. Pursuant to our biennial review of regulations in the Notice, we are revising and eliminating certain rules governing this service. In addition to the rules revised or eliminated as discussed below, we take this opportunity to update and reorganize the general aviation air-ground rules. In particular, we redesignate current § 22.803 of the general rules as new § 22.807 of the general aviation air-ground rules, and delete certain superfluous language therein that relates to the Rural Radiotelephone Service.

44. In contrast to most part 22 services, § 22.3(b)(1) requires an individual authorization to operate a general aviation airborne mobile station-an end user unit-in the Air-Ground Radiotelephone Service. This requirement is also reflected in § 1.903(c) of our rules. Individuals must file FCC Form 409 (Airborne Mobile Radio Telephone License Application) to apply for authority to operate an airborne station or to modify or renew an existing license.

45. We do not believe that the continued licensing of individual airborne mobile stations is warranted. At present, and likely for the foreseeable future, members of the public desiring service using the current Air-Ground Radiotelephone Automated Service (AGRAS) system must first purchase and install an AGRAS-compatible mobile telephone aboard their aircraft. Such mobile units are considerably more expensive and not as readily available as mobile telephones typically used with land-based public mobile systems. Coupled with the fact that the number of general aviation users is relatively small, the probability of unauthorized users is minimal.

46. More importantly, a potential air-ground subscriber must first register with the billing service utilized by the various air-ground licensees to obtain an aircraft telephone number in order to receive service. Therefore, the licensee's own billing service would know the number and identification of legitimate users of the air-ground AGRAS system. Presumably, if an un-registered user attempted to place calls over the AGRAS system, service would be denied.

47. In addition, the Commission has received few complaints regarding these stations. Air-Ground equipment is used to communicate with ground facilities that are otherwise licensed by the Commission. Moreover, we believe that the requirement to file Form 409 imposes an unnecessary regulatory burden on end users, because it involves preparation of a form as well as payment of a $50 fee for each subscriber unit.

48. Therefore, in keeping with the Commission's policy of simplifying, where appropriate, its licensing procedures and easing the administrative burden on licensees and other users of Wireless Radio Services, we eliminate, by revising §§ 1.903(c) and 22.3(b), the requirement that an authorization be obtained to operate general aviation airborne mobile stations in the Air-Ground Radiotelephone Service. We also eliminate FCC Form 409 and delete references to that form in §§ 1.1102 and 1.2003 of our rules.

49. Section 22.811 provides that, when a ground station transmitter authorized to transmit on any Air-Ground Radiotelephone Service channel listed in § 22.805 (for general aviation air-ground service) is available for service but idle, it must continuously transmit a modulated signal on that channel with a power between 10 and 20 dB lower than the normal transmitting power. We continue to believe that the deletion of § 22.811 from our rules is warranted. We take this opportunity to point out that the removal of this rule in no way prohibits carriers from employing the idle control tone. To the contrary, the action we take today is permissive. To the extent that idle tone transmissions are deemed valuable by system operators, they are free to continue to use it. In light of today's automated system, however, we do not believe that mandating its continued use is warranted.

50. Section 22.815 provides that “[t]he construction period (see § 22.142) for general aviation ground stations is 12 months.” We correct the reference in § 22.815 to specify the actual rule section, § 1.946.

51. Section 22.819 provides that, after January 1, 1996, stations transmitting on the general aviation air-ground service channels must operate in compliance with the requirements set forth in the document, “Technical Reference, Air-ground Radiotelephone Automated Service (AGRAS), System Operation and Equipment Characteristics,” dated April 12, 1985. The industry is currently developing a new operating technology that may be superior to AGRAS.

52. We delete § 22.819. Our deletion of the rule does not mean that the AGRAS protocols are prohibited. To the contrary, technological advancements in this area may continue to utilize AGRAS protocols if developers believe it would be appropriate. We are unwilling at this time to mandate the use of a particular technology when the market is more suited to make these decisions. We also believe that it is unlikely that the industry would simply forsake the current users of these systems.

53. Section 22.3(b) provides that, except for certain stations in the Rural Radiotelephone Service and the Air-Ground Radiotelephone Service, the operation by subscribers of mobile or fixed stations in the Public Mobile Services is covered by the authorization held by the common carrier providing service to them. Part 22 also contains other rules that use the term “common carrier.” Section 22.7 states that, “except as otherwise provided in this part, existing and proposed common carriers are eligible to hold authorizations in the Public Mobile Services.” We also pointed out that several of the definitions contained in § 22.99 include references to the term “common carrier.” Finally, we observed that the distinctions previously drawn between a radio common carrier and a wireline common carrier under the part 22 rules became obsolete in 1984.

54. We revise §§ 22.3(b), 22.7, and 22.99 by replacing the term “common carrier” with the term “licensee,” and thus deleting the requirement that licensees in part 22 services be common carriers. We also revise § 22.1(b) to delete the reference to “domestic common carrier,” and § 22.401 to delete the words “Communications common carriers” and replace with the words “Eligible entities (see § 22.7).” Section 22.351, regarding channel assignments, should be similarly amended. Finally, we delete the definitions for Radio Common Carrier and Wireline Common Carrier, as these terms are no longer used in part 22, and correct references to the term “Air-ground Radiotelephone Service” contained in several definitions in § 22.99 to read “Air-Ground Radiotelephone Service.”

55. Section 22.143(d)(4) of our rules provides that, for any pre-grant construction or alteration that would exceed the requirements of § 17.7, the licensee must notify the FAA and file a request for antenna height clearance and obstruction and marking specifications (FCC Form 854) with the FCC, PRB, Support Services Branch, Gettysburg, PA 17325. The correct filing location for FCC Form 854 is WTB, Spectrum Management Resources and Technologies Division, 1270 Fairfield Road, Gettysburg, PA 17325. We revise FCC Form 854 accordingly, and we amend § 22.143(d)(4) of our rules to include this updated address.

56. We recodify § 22.157 as new § 1.958 in part 1, subpart F. This will make the § 22.157 distance calculation method applicable to all Wireless Radio Services described in parts 1 (except parts 21 and 101 as explained below), 20, 22, 24, 27, 80, 87, 90, 95, and 97, and supersede any conflicting regulations in these parts. We note that software used by the Commission to process applications under parts 21 (Domestic Public Fixed Radio Services) and 101 (Fixed Microwave Services) is programmed to round the result of a distance calculation to the nearest tenth of a kilometer. Accordingly, we include language in new § 1.958 to indicate that distance calculations for applications under these parts must be rounded to the nearest tenth of a kilometer.

57. We recodify § 22.159 as new § 1.959 in part 1, subpart F. Part 90 services in the 470-512 MHz band, due to their proximity to TV operations, will continue to be governed by § 90.309(a)(4). Thus, all wireless services under parts 1, 20, 22, 24, 27, 80, 87, 90 (except the 470-512 MHz band), 95, 97 and 101 will be subject to the same computation methodology.

58. Section 22.161 sets forth application requirements for base stations in the Paging and Radiotelephone Service, Rural Radiotelephone Service, and Offshore Radiotelephone Service where the applicant proposes to employ amplitude compandored single sideband modulation (ASSB). We delete § 22.161. This rule section is obsolete in light of § 22.357, which permits part 22 licensees to use any emission type that complies with applicable emission limits.

59. Section 22.351 sets forth the general policy for the assignment of PMS channels. The third sentence of this section uses the term “common carrier.” We amend § 22.351 to replace the term “common carrier” with the term “licensee.”

60. Section 22.352 provides, in pertinent part, that PMS licensees shall be considered non-interfering if they operate in accordance with FCC rules that provide technical channel assignment criteria for the radio service or channels involved, all other applicable FCC rules, and the terms and conditions of their authorizations. We modify the relevant portion of § 22.352 to read “Public Mobile Service stations operating in accordance with applicable FCC rules and the terms and conditions of their authorizations are normally considered to be non-interfering.” The streamlined wording we adopt more accurately reflects how the Commission currently addresses interference issues, as we make clear that operation consistent with Commission rules and the applicable authorization—whether on a site-by-site basis or on a geographic area basis—creates a presumption of non-interfering operation.

61. An emission mask is defined as “[t]he design limits imposed, as a condition or certification, on the mean power of emissions as a function of frequency both within the authorized bandwidth and in the adjacent spectrum.” Section 22.357 provides that any authorized PMS station may use any type of emission provided that it complies with the appropriate emission mask. Section 22.359 is the general emission mask rule. Section 22.861 is the emission limitations and mask rule for commercial aviation air-ground systems. At the time the Commission adopted the part 22 rules, it generally used the emission mask approach to regulate in-band energy distribution. Recently, however, the Commission has been decreasing its reliance on the use of emission masks as a means to limit interference and, instead, increased its reliance on the use of out-of-band emission (OOBE) limits. The salient difference between emission masks and OOBE limits is that OOBE limits do not limit emission levels within a particular frequency band. Rather, they are intended to limit emissions outside of the authorized bandwidth.

62. Consistent with the recent increased use of OOBE limits, we replace the emission mask requirements found in §§ 22.357, 22.359, and 22.861 with an OOBE limitation. We believe that OOBE limitations are preferable to emission masks for the PMS because OOBE limitations do not need to be revised every time a new technology is implemented (unlike emission masks). Moreover, OOBE limitations make more sense with channels that are often combined in blocks, since there is no need for a single licensee on adjacent channels to be required to use an emission mask on each channel to protect itself. OOBE limitations protect services operating beyond the outer edges of the channel block. Emission masks require protection of each individual channel within the block.

63. Section 22.361 permits PMS licensees to install standby transmitters, without separate authorization, to continue service in the event of transmitter failure or during transmitter maintenance. It is now universally understood in the wireless industry that licensees are not required to obtain a separate authorization to install standby transmitters. Eliminating § 22.361 is warranted. We also note that doing so is in line with our desire to streamline or eliminate rules that are no longer necessary. Thus, we eliminate § 22.361.

64. Section 22.363 and Table C-2 to § 22.361 set forth directional antenna technical requirements. These requirements were adopted at a time when the Commission generally considered fixed wireless operations to be secondary to mobile operations. These regulations appear to no longer be necessary because, when the Commission licenses spectrum today, it provides greater flexibility to licensees to use the spectrum for mobile or fixed operations. We eliminate § 22.363 and Table C-2 to § 22.361.

65. Section 22.367 sets forth polarization requirements for the electromagnetic waves radiated by PMS providers. Where fixed and mobile services operate on a co-channel basis, the polarization restrictions may no longer be necessary or effective in reducing interference. We delete § 22.367.

66. Section 22.373 generally requires PMS transmitters to be accessible only to persons authorized by the licensee. We remove § 22.373 from our rules. We believe that the rule is unnecessary due to the fact that licensees have an economic self-interest to prevent unauthorized access to their transmitters.

67. Section 22.379 permits PMS licensees to replace equipment without notifying the Commission, provided that such equipment meets certain technical requirements. Licensees have known since the rule change in 1994 that applications are not required for replacement equipment.

68. We therefore eliminate § 22.379.

69. Section 22.381 limits the use of auxiliary test transmitters to testing the performance of fixed receiving equipment located remotely from the control point. Section 22.381 further provides that such transmitters may only transmit on channels designated for mobile transmitters. We believe that § 22.381 unnecessarily restricts the use of test equipment, and therefore we eliminate this section from our rules. We are aware of no harm that would arise from operating auxiliary test transmitters on any authorized channel, whether base or mobile, and no commenters have suggested otherwise.

70. Part 22, subpart D—which includes §§ 22.401, 22.403, 22.409, 22.411, 22.413, 22.415, and 22.417—governs grant of developmental authorizations in the PMS. As pointed out in the Notice, a review of Commission records indicates that these rules are seldom used and, instead, parties frequently file waiver requests that are tantamount to requests for developmental authorizations.

71. Sections 22.411 and 22.531(a) provide that 43 MHz channels can be initially assigned only as developmental authorizations. The requirements of §§ 22.411 and 22.531(a) are intended to mitigate interference with the intermediate frequency stages of receivers in television sets and video recorders. Section 22.411 also requires licensees to conduct and file semi-annual surveys during the first two years of operation to determine the extent of any interference to broadcast television receivers. We believe that §§ 22.411 and 22.531(a) are no longer required. Modern NTSC televisions are no longer particularly vulnerable to interference from the 43 MHz paging frequencies. Previously, television sets utilized an intermediate frequency amplifier that converted the received channel to a frequency between 40 and 46 MHz. New television sets, on the other hand, no longer employ this type of technology. In addition, the number of licensees and new applications for these paging channels is minimal. Consequently, it appears that there is no need for developmental authorizations for 43 MHz paging transmitters, and we delete these sections of our rules.

72. Section 22.415 provides that channels in the 928-931 and 952-960 MHz ranges may be assigned to fixed transmitters in point-to-multipoint systems at short-spaced locations (i.e., those that do not meet the 70-mile separation requirement of § 22.625(a)). The Commission cannot issue any developmental authorizations under § 22.415 unless it waives the licensing prohibition of § 22.621. This language would no longer be necessary were we to adopt our proposal to eliminate § 22.415. In light of the prohibition in § 22.621 against licensing any new 900 MHz frequencies, we eliminate § 22.415 and modify § 22.625(a) by eliminating all text following the first sentence that pertains to short-spaced developmental authorizations under § 22.415.

73. Section 22.417 provides that Rural Radiotelephone Service (RRS) central office and rural subscriber stations in Alaska may use “meteor burst” propagation modes. Meteor burst systems bounce radio signals off the ionized trails of evaporating space rocks to receivers up to 1,000 miles away. Meteor burst technology, however, only works in brief spurts because a typical meteor trail has an average duration of a few hundred milliseconds, while wait times between suitable trails can range from a few seconds to minutes. As such, the technology is well-suited for bursty data transmissions but is not suitable for a continuous voice call. Section 22.725(c) provides that channels 42.40, 44.10, 44.20 and 45.90 MHz may be used for such purposes in Alaska. Section 22.729 governs station operations using meteor burst propagation modes on these channels. There are no part 22 licensees on these channels in Alaska, although there are some licenses issued under part 90.

74. We do not believe that RRS stations in Alaska would benefit from maintaining the licensing option under §§ 22.417, 22.725(c), and 22.729, and we delete these section from our rules. Currently, there are no licensees taking advantage of these rules. In addition, as a practical matter, meteor burst propagation cannot be used to transmit voice calls, which is at the core of the RRS. We also delete the definition of “meteor burst propagation mode” in § 22.99, the § 22.313(a)(3) station identification requirements for Rural Radiotelephone Service subscriber stations using meteor burst propagation, and the § 22.727(f) limits on transmitter output power for meteor burst stations.

75. Under § 1.929(c)(1), any increase in the composite interference contour (CIC) of a site-based licensee in the Paging and Radiotelephone Service, Rural Radiotelephone Service, or 800 MHz Specialized Mobile Radio Service is a major modification of license that requires prior Commission approval. In March 2001, the Wireless Telecommunications Bureau conditionally waived § 1.929(c)(1) to permit expansion of paging CICs over water on a secondary basis.

76. We amend § 1.929(c)(1) and treat expansions of the CIC of a site-based licensee in the Paging and Radiotelephone Service, Rural Radiotelephone Service, or 800 MHz Specialized Mobile Radio Service over water, on a secondary, non-interference basis to any geographic area licensee in the same area, as a minor, not major, modification of license. We also define the term “over water” as “over bodies of water that extend beyond county boundaries including, but not limited to, oceans, the Gulf of Mexico, and the Great Lakes.” As a result, such expansions of the CIC are permissive and no notification to the Commission is required. The classification of these modifications as major can hamper a carrier's ability to respond to unexpected disruptions or to meet changes in consumer demand. Licensees providing service in coastal areas often need to relocate or adjust transmitting facilities in order to maintain and improve coverage. Moreover, CIC expansions that take place solely over water should pose no risk of interference to other systems on land, and Commission records indicate that we have not received any interference complaints arising from our current temporary policy of conditionally waiving § 1.929(c)(1). We also note the benefits to both licensees and the Bureau derived from the removal of these particular regulatory filing requirements. We believe that our action here will facilitate the provision of PMS services to the public.

77. Section 22.531(b) provides that frequencies 931.8875, 931.9125, and 931.9375 MHz may only be used for nationwide network paging service. Section 22.551 specifies the application process for such channels in the event one should become available for licensing, and provides additional rules for nationwide network paging service.

78. We believe that allowing licensees on these channels to provide services other than nationwide network paging is in line with our policy to facilitate flexible service offerings, our attempts to achieve regulatory parity among competing wireless services, and the highly competitive state of the paging industry. Similarly, we will apply our general paging licensing rules, including competitive bidding procedures, to license these channels in the event that one becomes available for licensing. Therefore, we delete §§ 22.313(a)(5), 22.531(b) and 22.551 from our rules.

79. Sections 22.539 and 22.569 govern the processing of applications for additional paging and mobile channels, respectively. In particular, these rules implement the Commission's general policy to assign only one paging or two mobile channels in an area to a carrier per application cycle. Carriers that seek to add channels to their systems in the same geographic service area may thus do so one at a time (two for mobile channels). Before applying for another channel, carriers must certify that service has commenced on the previously-granted channel(s).

80. We delete §§ 22.539 and 22.569 from our rules. Today, the part 22 paging channels set forth in these rule sections are licensed on a geographic area basis rather than assigned on a site-by-site basis. We no longer place a blanket restriction on the amount of spectrum that a single entity may hold in one area (although we review competitive issues involving paging licensees on a case-by-case basis). Incumbents operating on a site-by-site basis may expand their systems by assignment or transfer of a license or by participating in a spectrum auction. In addition, under our current licensing scheme for paging channels, we place no blanket restrictions on the number of overlapping part 22 paging channels that a particular entity may hold in one area. Consequently, we believe that maintaining these rules is unnecessary.

81. Section 22.563 requires stations in the Paging and Radiotelephone Service that provide two-way public mobile service on certain channels to also provide Rural Radiotelephone Service (RRS) upon request from a subscriber. These channels are now predominantly assigned for use by one-way paging systems that are technically incapable of providing RRS. We believe that § 22.563 is no longer needed. Not only are most of these channels assigned for one-way paging use, there are now a number of wireless telephone service alternatives to RRS (e.g., cellular, PCS, and some SMR). Moreover, consumers in many areas—including rural areas—have begun to substitute cellular, PCS, and some SMR service for landline service. This nascent trend is driven in part by wireless service plans that include the price of long distance service that may reduce a consumer's aggregate charges for local and toll service. In light of these circumstances and the fact that rural subscribers may readily obtain fixed basic telephone services from a variety of sources, we delete § 22.563 from our rules.

82. Section 22.565(g) limits the effective radiated power (ERP) of dispatch and auxiliary test transmitters to 100 watts. We delete § 22.565(g) so that test transmitters may operate, pursuant to § 22.565(a), at a limit of 150 watts. We note that because we have decided to permit auxiliary test transmitters to operate on both base and mobile frequencies, licensees can now choose to operate on either the base or the mobile side of the frequency subject to the 150-watt limit under § 22.565(a).

83. Section 22.577 governs the provision of dispatch service. We believe that the deletion of § 22.577 of our rules is warranted. We find that the rule is outdated and no longer necessary. Moreover, “limits on output power and the functionality of the dispatch transmitter” are out of line with the Commission's emphasis on “flexible spectrum use.” In addition, part 90 dispatch operations are not subject to such restrictions, and that the removal of § 22.577 will “expand the choices to wireless end users.” We therefore delete § 22.577.

84. Section 22.591 also includes a table of 2110-2130 and 2160-2180 MHz microwave channels. In 1992, the Commission allocated these bands for use by emerging technologies (ET) services and no new systems may be authorized on these channels under part 22. Recently, the Commission allocated, inter alia, the 2110-2130 MHz band for Advanced Wireless Services (AWS). At present, both the 2110-2130 and 2160-2180 MHz bands are widely used for common carrier fixed microwave service.

85. In addition, § 22.601 specifies rules for modification of previously authorized part 22 stations on the 2110-2130 and 2160-2180 MHz channels. Section 22.602 sets forth rules governing a transition period for Paging and Radiotelephone Service licensees on the microwave channels listed in § 22.591 to relocate to other frequencies. We delete the microwave channels from the § 22.591 table and delete § 22.591(b) regarding the assignment of such channels. We will allow the licenses to expire at the end of their current authorizations, and we will not renew them for another license term. These microwave incumbents will, in the meantime, continue to be subject to §§ 22.601 and 22.602 (although once their license terms end, these sections will become superfluous). We will delete the cross-reference to § 22.591 in §§ 22.601 and 22.602 and, instead, reference the 2110-2130 and 2160-2180 MHz channels.

86. Section 22.593 specifies power limits for the channels enumerated in § 22.591. Although we are deleting the microwave channels listed in § 22.591, these microwave licensees are still subject to § 22.593, which specifies the EIRP of the microwave channels listed in § 22.591. Consequently, we will not amend this rule until after the subject licenses have expired.

87. Section 22.655 requires a subcategory of paging licensees—470-512 MHz band licensees—to submit defined channel usage reports every three months. Only two carriers must still file these reports; they have maintained mobile usage of the channels for some time, and loading reporting requirements for other paging operators have been eliminated.

88. We eliminate § 22.655 so that we no longer require licensees engaged in trunked mobile operations to measure and report channel usage. The continuation of this reporting requirement is burdensome and no longer necessary. Moreover, there are only two licensees that currently remain subject to this requirement, while the majority of CMRS licensees using the 470-512 MHz band do not have to submit these quarterly reports. Given these circumstances, we do not believe that the continued channel usage reporting requirements are warranted.

89. Section 22.757 specifies channels (in addition to those listed in § 22.725) in the frequency ranges 816.0125-820.2375 MHz and 861.0125-865.2375 MHz that are allocated for paired assignment to basic exchange telephone radio systems (BETRS). The Commission auctioned these channels on a geographic area basis in Auction 16, and that they are no longer available for assignment to BETRS. We therefore eliminate § 22.757 and amend the first sentence of § 22.725 to provide that the channels listed therein are available for paired assignment to BETRS.

90. Subpart I of part 22—which includes §§ 22.1001, 22.1003, 22.1005, 22.1007, 22.1009, 22.1011, 22.1013, 22.1015, 22.1025, 22.1031, 22.1035, and 22.1037—governs the licensing and operation of Offshore Radiotelephone Service (ORS) stations. These stations provide telephone service to subscribers located on oil exploration and production platforms in the Gulf of Mexico. At this time, we take no action on the majority of the rules in this Subpart, and we will revisit the ORS rules at another time. We also revise § 22.1003, to revise the eligibility requirements to eliminate references to “common carriers” and instead to rely on language similar to that used in parts 24 and 27 (“[a]ny entity, other than those precluded by section 310 of the Communications Act of 1934, as amended, 47 U.S.C. 310, * * * is eligible to hold a license under this part”).

91. As required by the Regulatory Flexibility Act of 1980, as amended (RFA), an Initial Regulatory Flexibility Analysis (IRFA) was incorporated in the Notice of Proposed Rulemaking (Notice) in this proceeding, WT Docket No. 03-103. The Commission sought written public comment on the proposals in the Notice, including comment on the IRFA. This present Final Regulatory Flexibility Analysis (FRFA) conforms to the RFA.

92. The Report and Order addresses revision of the rules and spectrum band plan for the 800 MHz commercial Air-Ground Radiotelephone Service spectrum. A total of four megahertz of spectrum is currently allocated for this service. Although the Commission originally licensed six operators to provide service in this band on a shared basis using narrowband channels, only one licensee (Verizon Airfone) continues to operate in the band. Its operations are subject to a number of specific technical requirements designed to facilitate sharing among licensees. Given the constraints on current operations in this band and the changing demands of the public with respect to wireless telecommunications services, the Notice requested comment on how best to reconfigure this band and revise the related service rules in order to meet consumer needs and promote flexible, competitive use of this spectrum.

93. The Report and Order makes available new nationwide air-ground licenses in three band configurations: (1) Band plan 1, comprised of two overlapping, shared, cross-polarized 3 MHz licenses (licenses A and B, respectively), (2) band plan 2, comprised of an exclusive 3 MHz license and an exclusive 1 MHz license (licenses C and D, respectively), and (3) band plan 3, comprised of an exclusive 1 MHz license and an exclusive 3 MHz license (licenses E and F, respectively), with the blocks at opposite ends of the band from the second configuration. Licenses will have a 10-year term. Licenses will be awarded to winning bidders for the licenses comprising the configuration that receives the highest aggregate gross bid, subject to long-form license application review.

94. The Report and Order also takes action on a range of proposals for updating the Commission's part 1, 22, and 90 rules. Some of these steps are taken pursuant to the Commission's biennial review obligations as well as to implement the results of staff review of the part 22 non-cellular rules. The Report and Order revises and eliminates many rule sections in light of technological change, increased competition in Commercial Mobile Radio Services, supervening changes to the Commission's rules, or a combination of factors. These rule changes also include actions to harmonize the treatment of various wireless services.

95. We received no comments in response to the IRFA. As described in section E below, we have nonetheless considered potential significant economic impacts of our actions on small entities.

96. 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 the 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 which: (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).

97. Wireless Service Providers. The SBA has developed a small business size standard for wireless firms within the two broad economic census categories of “Paging” and “Cellular and Other Wireless Telecommunications.” Under both SBA categories, a wireless business is small if it has 1,500 or fewer employees. For the census category of Paging, Census Bureau data for 1997 show that there were 1,320 firms in this category, total, that operated for the entire year. Of this total, 1,303 firms had employment of 999 or fewer employees, and an additional 17 firms had employment of 1,000 employees or more. Thus, under this category and associated small business size standard, the great majority of firms can be considered small. For the census category Cellular and Other Wireless Telecommunications, Census Bureau data for 1997 show that 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. Thus, under this second category and size standard, the great majority of firms can, again, be considered small.

98. Cellular Licensees. As noted, the SBA has developed a small business size standard for wireless firms within the broad economic census category “Cellular and Other Wireless Telecommunications.” Under this SBA category, a wireless business is small if it has 1,500 or fewer employees. For the census category Cellular and Other Wireless Telecommunications firms, Census Bureau data for 1997 show that 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. Thus, under this category and size standard, the great majority of firms can be considered small. According to the most recent Trends in Telephone Service data, 719 carriers reported that they were engaged in the provision of cellular service, personal communications service, or specialized mobile radio telephony services, which are placed together in the data. We have estimated that 294 of these are small, under the SBA small business size standard.

99. Common Carrier Paging. The SBA has developed a small business size standard for wireless firms within the broad economic census categories of “Cellular and Other Wireless Telecommunications.” Under this SBA category, a wireless business is small if it has 1,500 or fewer employees. For the census category of Paging, Census Bureau data for 1997 show that there were 1,320 firms in this category, total, that operated for the entire year. Of this total, 1,303 firms had employment of 999 or fewer employees, and an additional 17 firms had employment of 1,000 employees or more. Thus, under this category and associated small business size standard, the great majority of firms can be considered small.

100. In the Paging Second Report and Order, 62 FR 11616, March 12, 1997, the Commission adopted a size standard for “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. The SBA has approved this definition. An auction of Metropolitan Economic Area (MEA) licenses commenced on February 24, 2000, and closed on March 2, 2000. Of the 2,499 licenses auctioned, 985 were sold. Fifty-seven companies claiming small business status won 440 licenses. An auction of MEA and Economic Area (EA) licenses commenced on October 30, 2001, and closed on December 5, 2001. Of the 15,514 licenses auctioned, 5,323 were sold. One hundred thirty-two companies claiming small business status purchased 3,724 licenses. A third auction, consisting of 8,874 licenses in each of 175 EAs and 1,328 licenses in all but three of the 51 MEAs commenced on May 13, 2003, and closed on May 28, 2003. Seventy-seven bidders claiming small or very small business status won 2,093 licenses. Currently, there are approximately 74,000 Common Carrier Paging licenses. According to the most recent Trends in Telephone Service, 608 private and common carriers reported that they were engaged in the provision of either paging or “other mobile” services. Of these, we estimate that 589 are small, under the SBA-approved small business size standard. We estimate that the majority of common carrier paging providers would qualify as small entities under the SBA definition.

101. Offshore Radiotelephone Service. This service operates on several ultra high frequency (UHF) television broadcast channels that are not used for television broadcasting in the coastal areas of states bordering the Gulf of Mexico. There are currently approximately 55 licensees in this service. We are 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.

102. 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 proposed herein.

103. Air-Ground Radiotelephone Service. The Commission has not adopted a small business size standard specific to the Air-Ground Radiotelephone Service. Again, we note that SBA has a 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 we estimate that almost all of them qualify as small under the SBA small business size standard. (See also the Notice and associated IRFA in this proceeding, which describe two proposed small business size standards for the commercial Air-Ground Radiotelephone Service.)

104. Wireless Communications Equipment Manufacturers. Some of the actions in the Report and Order could also benefit equipment manufacturers. The SBA has established a small business size standard for Radio and Television Broadcasting and Wireless Communications Equipment Manufacturing. Examples of products in this category include “transmitting and receiving antennas, cable television equipment, GPS equipment, pagers, cellular phones, mobile communications equipment, and radio and television studio and broadcasting equipment” and may include other devices that transmit and receive IP-enabled services, such as personal digital assistants (PDAs). Under the SBA size standard, firms are considered small if they have 750 or fewer employees. According to Census Bureau data for 1997, there were 1,215 establishments in this category that operated for the entire year. Of those, there were 1,150 that had employment of under 500, and an additional 37 that had employment of 500 to 999. The percentage of wireless equipment manufacturers in this category was approximately 61.35%, so we estimate that the number of wireless equipment manufacturers with employment of under 500 was actually closer to 706, with and additional 23 establishments having employment of between 500 and 999. Consequently, we estimate that the majority of wireless communications equipment manufacturers are small entities that may be affected by our action.

105. In this Report and Order, we are not adopting any new rules that would add reporting, recordkeeping, or other compliance requirements. We only modify or eliminate certain rules, thereby eliminating economic burdens for small and other sized entities. For example, we amend § 1.929(c)(1) of our rules to specify that expansion of a composite interference contour (CIC) of a site-based licensee in the Paging and Radiotelephone Service—as well as the Rural Radiotelephone Service and 800 MHz Specialized Mobile Radio Service—over water on a secondary, non-interference basis should be classified as a minor (rather than major) modification of license. Such reclassification should substantially reduce the filing requirements associated with these license modifications.

106. The RFA requires an agency to describe any significant alternatives that it has considered in developing its 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 and reporting requirements under the rule for such 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 such small entities.”

107. We do not anticipate any adverse impact on small entities resulting from either reconfiguration of the 800 MHz Air-Ground Radiotelephone Service band plan or revision of the related service rules. Currently, there is only one licensee in this band and demand for its service has markedly declined. The flexible approach to reconfiguration of the 800 MHz air-ground band adopted in the Report and Order will promote our goal of facilitating the highest valued use of this spectrum, resulting in the provision of wireless communications services that better meet the needs of the traveling public onboard aircraft.

108. In order to promote competition in the 800 MHz air-ground band, the Report and Order prohibits any party from obtaining a controlling interest, either at auction or by a post-auction transaction, in more than three megahertz of spectrum (either shared or exclusive) in the band. No single entity, therefore, may hold more than one license in any of the available band configurations. The Report and Order adopts limited technical constraints in order to provide the eventual licensees with significant operational flexibility to provide broadband telecommunications services to commercial airline passengers and others while onboard aircraft. We note that the technical rules will, among other things, ensure that operations in this band do not cause harmful interference to adjacent bands, including cellular, SMR, and public safety. The Report and Order provides that future licensees in the 800 MHz air-ground band, as well as other interested parties, will have the opportunity to engage in spectrum leasing under the Commission's rules. Future licensees will also be permitted to engage in partitioning and/or disaggregation of their licenses. These regulatory opportunities are intended to provide the air-ground marketplace greater flexibility to respond to consumer demand. The regulatory approach adopted in the Report and Order will benefit both small and large entities.

109. Regarding the modification or elimination of rules stemming from our Biennial Regulatory Review responsibilities, we do not anticipate any adverse impact on small entities. To the contrary, to the extent that there is any direct impact at all, streamlining and harmonizing technical and operational rules should result in decreasing regulatory burdens that benefit both small and large entities.

110. The Commission will send a copy of the Report and Order, including this FRFA, in a report to be sent to Congress pursuant to the Congressional Review Act. In addition, the Commission will send a copy of the Report and Order, including this FRFA, to the Chief Counsel for Advocacy of the SBA.

111. Pursuant to the authority contained in sections 1, 4(i), 11, 303(r) and (y), 308, 309, and 332 of the Communications Act of 1934, as amended, 47 U.S.C. 151, 154(i), 161, 303(r), 303(y), 308, 309, and 332, this Report and Order is hereby adopted, and parts 1, 22, and 90 of the Commission's rules are amended accordingly.

112. Pursuant to sections 4(i), 301, and 307 of the Communications Act, as amended, 47 U.S.C. 154(i), 301, and 307, a new license for Station KNKG804, is granted to Verizon Airfone Inc. for a five-year non-renewable term in accordance with the terms and conditions set forth above (file no. 0001716212).

This is a summary of the Commission's Report and Order, in EB Docket No. 04-51, FCC 05-21, adopted January 28, 2005 and released February 7, 2005. The complete text of this Report and Order is available for inspection and copying during normal business hours in the FCC Reference Information Center, 445 12th Street, SW., Room CY-A527, Washington, DC 20554. This document may also be purchased from the Commission's duplicating contractor, Best Copy and Printing, Inc., 445 12th Street, SW., Room CY-B402, Washington, DC 20554, telephone (202) 863-2893, facsimile (202) 863-2898, or via Web site at http://www.bcpiweb.com. It is also available on the Commission's Web site at http://www.fcc.gov.

1. In this Report and Order, the Commission adopts revisions to part 11 of the Commission's rules governing the Emergency Alert System (EAS) that will allow wireless cable television systems to provide EAS alerts to their subscribers in a more efficient and less burdensome manner. Specifically, wireless cable system operators will now be able to install equipment that provides a means to switch all programmed channels to a predesignated channel that carries an EAS alert in lieu of installing an EAS decoder for each and every system channel. Accordingly, upon receipt of an EAS alert, subscribers' equipment will automatically be tuned to the channel carrying the EAS message.

2. The Commission released a Notice of Proposed Rulemaking (NPRM), 69 FR 18857, March 12, 2004, seeking comment on revisions to part 11 of the Commission's rules. Comments and replies were due May 10, 2004 and May 24, 2004, respectively. WCA and W.A.T.C.H. TV both submitted comments in support of the proposed modifications. W.A.T.C.H. TV, in its comments recommended a permanent rule change. No comments opposed the suggested rule revision, and no replies were submitted.

3. The Commission's EAS rules are designed to ensure that individual TV viewers, including viewers of wireless cable TV systems, receive all national level EAS alerts, no matter what channel the viewer may be watching. As these rules are currently written, wireless cable providers serving more than 5,000 subscribers are required to install special equipment sufficient to display the audio and video EAS message on every channel in their systems. Systems serving fewer than 5,000 subscribers are required to display the audio and video EAS message only on one channel, but must provide a video interrupt and an audio alert on every channel.

4. The Commission's EAS rules were neither intended to require a particular technical solution nor to impose an unnecessary financial burden on participating cable providers. The Commission agrees that a good technical alternative exists to minimize that burden without harm to the public. As a result of these modifications, a wireless cable operator would be able to install EAS equipment for one channel only at the headend of each of its systems, and in the event of an EAS alert, automatically force each subscriber's equipment to tune to the channel carrying the EAS alert. This would allow wireless cable providers to deliver EAS alerts to all viewers in a more technologically and economically efficient manner. The Commission believes these revisions would satisfy the Communications Act's intent to provide national alert and warning to the public, while reducing the regulatory burden on wireless cable systems. The Commission also notes that W.A.T.C.H. TV, a wireless cable system, has successfully deployed force tuning in its system, and that no comments were filed opposing this approach. Accordingly, the Commission modifies its EAS rules to allow wireless cable TV systems to supply an EAS alert to their viewers by force tuning their systems. Also, because the revisions the Commission adopts today do not affect wireless cable systems' EAS equipment, the Commission adopts its tentative conclusion that no new authorization standards for such equipment are required.

5. The Commission recently released a Notice of Proposed Rulemaking (NPRM), 69 FR 52843 (August 30, 2004), in which it sought comment on whether EAS as currently constituted is the most effective and efficient public warning system available to the American public. One of the primary objectives of the August 2004 NPRM is to determine whether there are any specific steps the Commission may take to enhance the effectiveness of EAS, particularly as regards digital, wireless, and other emerging communications technologies. Accordingly, regardless of the modifications made in the Report and Order, wireless cable operators are still subject to any future rulemaking proceedings. The Report and Order does not affect the Commission's ability to adjust any of the wireless cable requirements or impose other obligations on wireless cable operators through general rulemaking proceedings.

6. Because the modifications to the Commission's EAS rules will contribute to an economically efficient and technologically current public alert and warning system, in the Report and Order, the Commission adopts the proposed revisions to the EAS rules for wireless cable operators.

7. As required by the Regulatory Flexibility Act, 5 U.S.C. 603, the Commission has prepared a Final Regulatory Flexibility Analysis (FRFA) for the Report and Order. The Commission will send a copy of the Report and Order, including the FRFA, to the Chief Counsel for Advocacy of the Small Business Administration.

8. As required by the Regulatory Flexibility Act (RFA), an Initial Regulatory Flexibility Analysis (IRFA) was incorporated in the NPRM. The Commission sought comment on the proposals in the NPRM, including comment on the IRFA. The present Final Regulatory Flexibility Analysis (FRFA) conforms to the RFA.

9. In the Report and Order, the Commission adopts revisions to part 11 of the Commission's rules governing the Emergency Alert System (EAS). The revisions will reduce burdens on wireless cable television systems and improve the overall performance of the EAS.

10. There were no comments filed specifically in response to the IRFA. Nevertheless, the agency has considered the potential impact of the rules proposed in the IRFA on small entities. As a result of these modifications, a wireless cable operator will now be able to install EAS equipment for one channel only at the headend of the system. In the event of an EAS alert, the system will automatically force each subscriber set-top box to tune to the channel carrying the EAS alert. This will allow wireless cable providers to deliver EAS alerts to all viewers in a more technologically and economically efficient manner. While this rule revision provides the greatest economic benefit to systems with over 5,000 subscribers by obviating the need for special signal conversion for all channels, it also provides a benefit to those systems with fewer than 5,000 subscribers.

11. The RFA directs agencies to provide a description of and, where feasible, an estimate of the number of small entities that will be affected by the proposed rules. 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 which: (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). A small organization is generally “any not-for-profit enterprise which is independently owned and operated and is not dominant in its field.” The arts, entertainment, and recreations sector had 96,497 small firms.

12. Broadband Radio Services. The adopted rules would apply to Broadband Radio Services (BRS) operated as part of a wireless cable system. The Commission has defined “small entity” for purposes of the auction of BRS frequencies as an entity that, together with its affiliates, has average gross annual revenues that are not more than $40 million for the preceding three calendar years. This definition of small entity in the context of BRS auctions has been approved by the SBA. The Commission completed its BRS auction in March 1996 for authorizations in 493 basic trading areas. Of 67 winning bidders, 61 qualified as small entities. At this time, we estimate that of the 61 small business BRS auction winners, 48 remain small business licensees.

13. BRS also includes licensees of stations authorized prior to the auction. As noted, the SBA has developed a definition of small entities for pay television services, Cable and Other Subscription Programming, which includes all such companies generating $12.5 million or less in annual receipts. This definition includes BRS and thus applies to BRS licensees that did not participate in the BRS auction. Information available to us indicates that there are approximately 392 incumbent BRS licensees that do not generate revenue in excess of $11 million annually. Therefore, we find that there are approximately 440 (392 pre-auction plus 48 auction licensees) small BRS providers as defined by the SBA and the Commission's auction rules which may be affected by the rules adopted herein.

14. Educational Broadband Services. The adopted rules would also apply to Educational Broadband Services (EBS). The SBA definition of small entities for pay television services also appears to apply to EBS. There are presently 2,032 EBS licensees. All but 100 of these licenses are held by educational institutions. Educational institutions are included in the definition of a small business. However, we do not collect annual revenue data for EBS licensees, and are not able to ascertain how many of the 100 non-educational licensees would be categorized as small under the SBA definition. Thus, we conclude that at least 1,932 EBS are small businesses and may be affected by the adopted rules.

15. There are no reporting or recordkeeping requirements adopted in the Report and Order. The revisions adopted in the Report and Order are, for the most part, intended to enhance the performance of the EAS while reducing the burden on digital wireless cable systems. We emphasize that participation in state and local EAS activities remains voluntary and that we do not impose additional costs or burdens on entities that choose not to participate in state and local area EAS plans. The Report and Order adopts rules that permit new equipment capabilities and new policies with regard to method of delivery of EAS messages to viewers for all EAS alerts: National, state and local. These modifications will lessen cost and operational burdens on digital wireless cable system EAS participants.

16. The RFA requires an agency to describe any significant alternatives that it has considered in reaching its approach, which may include the following four alternatives: (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.

17. In the NPRM, we sought comment on the impact of our proposals on small entities and on any possible alternatives that would minimize the impact on small entities. In adopting the modifications contained in the Report and Order, we have attempted to minimize the burdens on all entities.

18. The Commission will send a copy of the Report and Order, including the FRFA, in a report to be sent to Congress pursuant to the Congressional Review Act, see 5 U.S.C. 801(a)(1)(A). In addition, the Commission will send a copy of the Report and Order, including the FRFA, to the Chief Counsel for Advocacy of the Small Business Administration. A copy of the Report and Order and FRFA (or summaries thereof) will also be published in the Federal Register.

19. This document does not contain new or modified information collection requirements subject to the Paperwork Reduction Act of 1995 (PRA), Public Law 104-13. In addition, therefore, it does not contain any new or modified “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(4).

20. Accordingly, it is ordered that pursuant to the authority contained in sections 1, 4(i), 4(j), and 4(o), 303(r), 624(g) and 706 of the Communications Act of 1934, as amended, 47 U.S.C. 151, 154(i), 154(j), and 154(o), 303(r), 544(g) and 606, this Report and Order is adopted.

21. It is further ordered that part 11 of the Commission's rules, 47 CFR part 11, is amended as set forth, effective May 13, 2005.

22. It is further ordered that the Reference Information Center, Consumer and Governmental Affairs Bureau, shall send a copy of this Report and Order, including the Final Regulatory Flexibility Analysis, to Congress pursuant to the Congressional Review Act, 5 U.S.C. 801(a)(1)(A).

23. It is further ordered that the Reference Information Center, Consumer and Governmental Affairs Bureau, shall send a copy of this Report and Order, including the Final Regulatory Flexibility Analysis, to the Chief Counsel for Advocacy of the Small Business Administration in accordance with the Regulatory Flexibility Act.

This is a summary of the Commission's Memorandum Opinion and Order and Second Order on Reconsideration in IB Docket No. 01-185, FCC No. 05-30, adopted February 10, 2005 and released on February 25, 2005. The full text of this Commission decision is available for inspection and copying during normal business hours in the FCC Reference Center (Room CY-A257). The document is also available for download over the Internet at http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-05-30A1.doc. The complete text may also be purchased from the Commission's copy contractor, Best Copy and Printing, Inc. (BCPI) located in Room CY-B402, 445 12th Street, SW., Washington, DC 20554. Customers may contact BCPI at their web site: http://www.bcpiweb.com or call 1-800-378-3160.

On February 10, 2003, the Commission released a Report and Order (MSS Flexibility R&O) in this proceeding (68 FR 33640, June 5, 2003). The MSS Flexibility R&O permitted MSS operators to provide integrated ATC within their assigned MSS spectrum, and adopted rules pertaining to the licensing and operation of ATC systems. The Commission established a set of prerequisites, known as “gating criteria,” that MSS operators would have to satisfy in order to add ATC to their systems. The Commission also established technical rules to ensure that ATC did not interfere with other MSS operators' systems or with other services. Finally, the Commission concluded that ATC authority would be granted by modifying MSS operators' current licenses, and that ATC authority would not be granted by competitive bidding. On July 3, 2003, the Commission released an Order on Reconsideration (Sua Sponte Order) (68 FR 47856, August 12, 2003), which clarified certain aspects of the MSS Flexibility R&O.

On February 10, 2005, the Commission adopted the Memorandum Opinion and Order and Second Order on Reconsideration in this proceeding. The Memorandum Opinion and Order and Second Order on Reconsideration amends the licensing and service rules for ATC in the 2000-2020 and 2180-2200 MHz bands (the 2 GHz MSS band), the 1525-1559 MHz and 1626.5-1660.5 MHz bands (the L-band), and the 1610-1626.5 MHz and 2483.5-2500 MHz bands (the Big LEO band). MSS can provide mobile communications at any location in the United States, including rural and remote areas and offshore maritime areas where communications by terrestrial mobile systems are often unavailable. In some areas, however, particularly urban areas, the communications signal from the MSS satellite can be blocked by tall buildings. For this reason, there are areas where MSS communications are not available. ATC will provide integrated communications coverage in these areas, allowing MSS/ATC to offer ubiquitous service to consumers.

The Memorandum Opinion and Order and Second Order on Reconsideration responded to petitions for reconsideration of the MSS Flexibility R&O and Sua Sponte Order in four major areas: (1) Gating criteria, (2) uplink interference, (3) downlink interference, and (4) licensing rules.

Gating Criteria. The Memorandum Opinion and Order and Second Order on Reconsideration considered requests to change the gating criteria which MSS operators must meet in order to provide ATC. The Commission declined to require that a percentage of MSS/ATC system capacity must be reserved for MSS operations. The Commission also declined to require MSS/ATC user terminals, such as handsets, to attempt to contact the satellite before communicating through the ATC. The Commission also clarified the meaning of the term “dual-mode device,” the prohibition on offering ATC-only service, and the requirement that an MSS operator must satisfy the gating criteria in each band in which it seeks to offer ATC.

Uplink Interference. The Memorandum Opinion and Order and Second Order on Reconsideration changes the basis of the uplink interference rules in the L-band. Previously, the technical rules designed to limit uplink interference to the MSS/ATC operator's own satellite and the satellites of other MSS operators were a detailed set of restrictions on ATC base stations and handsets. The Commission reconsidered these rules, and replaced them with limits on the overall amount of interference an MSS/ATC system, as a whole, may cause to other MSS systems in the L-band.

Downlink Interference. The Memorandum Opinion and Order and Second Order on Reconsideration increased the maximum power of ATC base stations in the L-band. The power limits on ATC base stations in the MSS Flexibility R&O were based on an assumed MSS user terminal receiver tolerance level for interference of -60 dBm. The Commission staff tested representative MSS user terminals and determined that the correct tolerance level for interference of these terminals is -52 dBm. This justifies an 8 dB increase in the maximum power of ATC base stations, and in the power flux density (PFD) that ATC base stations may produce near airports and waterways. In order to provide extra interference protection for the 1544-1545 MHz sub-band, which is used for distress and safety communications, the Commission retained the former ATC base station power limits in the 1541.5-1547.5 MHz sub-band, based on measurements that demonstrate lower MSS terminal tolerance for interference from interfering signals close to the desired signal. The Commission also required MSS/ATC operators to coordinate with other MSS operators when there was a likelihood that third-order intermodulation from ATC base stations could cause harmful interference to MSS terminals. In addition, the Commission noted that grant of future ATC applications will be coordinated with the National Telecommunications and Information Administration, pursuant to the general notification process, to assure adequate protection of the Radionavigation Satellite Service (RNSS) signals in the 1559-1610 MHz band.

Licensing Rules. The Memorandum Opinion and Order and Second Order on Reconsideration reconsidered the licensing rules for ATC, and amended the rules to allow non-operational MSS operators to demonstrate that they would soon meet the gating criteria. Upon a substantial showing, the Commission will grant ATC authorization to these non-operations MSS operators so they may begin ATC operations at the same time they begin MSS operations. The Commission also reconsidered and reaffirmed its decision that ATC authority is not eligible for assignment by competitive bidding.

The Memorandum Opinion and Order and Second Order on Reconsideration does not contain information collections subject to the Paperwork Reduction Act of 1995 (PRA), Public Law No. 104-13. It also, therefore, does not contain any new or modified “information collection burden for small business concerns with fewer than 25 employees,” pursuant to the Small Business Paperwork Relief Act of 2002, Public Law No. 107-198, see 44 U.S.C. 3506(c)(4).

The Regulatory Flexibility Act of 1980, as amended (RFA), requires that a regulatory flexibility analysis be prepared for notice-and-comment rule making proceedings, unless the agency certifies that “the rule will not, if promulgated, have a significant economic impact on a substantial number of small entities.” (See 5 U.S.C. 601-612; the RFA has been amended by the Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA), Public Law 104-121, Title II, 110 Stat. 857 (1996)). 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. (See 5 U.S.C. 601(3), incorporating by reference the definition of “small-business concern” in the Small Business Act, (15 U.S.C. 632)). Pursuant to 5 U.S.C. 601(3), the statutory definition of a small business applies “unless an agency, after consultation with the Office of Advocacy of the Small Business Administration and after opportunity for public comment, establishes one or more definitions of such term which are appropriate to the activities of the agency and publishes such definition(s) in the Federal Register.” A “small business concern” is one which: (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).

As required by the RFA, an Initial Regulatory Flexibility Analysis (IRFA) was incorporated in the MSS Flexibility Notice, (68 FR 33666, June 5, 2003) and no parties responded to the IRFA. After a review of the policies and rules adopted in the MSS Flexibility R&O, the Commission determined that there would be no significant impact on a substantial number of small entities. Thus, a Final Regulatory Flexibility Certification was included in the MSS Flexibility R&O.

In addressing the issues raised by the parties seeking reconsideration of the MSS Flexibility R&O, no parties commented on the regulatory flexibility certification. We certify that the policies and rules adopted in the Memorandum Opinion and Order and Second Order on Reconsideration will not have a significant impact on a substantial number of small entities.

We are incorporating the Final Regulatory Analysis Certification contained in the MSS Flexibility R&O into this proceeding. In our reconsideration of the petitions in this proceeding, we modify our rules that permit the addition of ATC to MSS systems. We change certain technical standards for ATC in the L-band, in order to permit MSS/ATC licenses flexibility in designing and operating their ATC while at the same time preventing harmful interference from ATC to co-primary MSS licensees in the L-band. In addition, we will allow certain increases in ATC base station power. We also modify the rules for authorizing MSS operators to add ATC to their networks. We expect that these changes will facilitate the development of MSS/ATC. We believe that all entities, both large and small, will have the flexibility to design their systems to meet their customers' needs. The policies and rules adopted in this proceeding are essentially technical changes that will provide equal opportunity for operational and non-operational MSS systems to add ATC without undue delay.

We believe that the policies and rules adopted in this proceeding—which bring additional flexibility to existing MSS licensees—will not affect a substantial number of small entities. There are currently five 2 GHz MSS licensees, two Big LEO MSS licensees and three L-band MSS licensees authorized to provide service in the United States. Although at least one of the 2 GHz MSS system licensees and one of the Big LEO licensees are small businesses, small businesses often do not have the financial ability to become MSS system operators because of the high implementation costs associated with satellite systems and services. We expect that, by the time of MSS ATC system implementation, these current small businesses will no longer be considered small due to the capital requirements for launching and operating a proposed system.

Therefore, we certify that the requirements of the Memorandum Opinion and Order and Second Order on Reconsideration will not have a significant economic impact on a substantial number of small entities.

The Commission will send a copy of the Memorandum Opinion and Order and Second Order on Reconsideration, including a copy of this Final Regulatory Flexibility Certification, in a report to Congress pursuant to the Congressional Review Act (see 5 U.S.C. 801(a)(1)(A)).

Pursuant to sections 4(i), 7, 302, 303(c), 303(e), 303(f) and 303(r) of the Communications Act of 1934, as amended, 47 U.S.C. 154(i), 157, 302, 303(c), 303(e), 303(f) and 303(r), this Memorandum Opinion and Order and Second Order on Reconsideration is adopted and that part 25 of the Commission's rules is amended, as specified in the Final rule, effective May 13, 2005.

The Petitions for Reconsideration of the MSS Flexibility R&O filed by Cingular Wireless LLC, the Society of Broadcast Engineers, Inc., and Cellular Telecommunications & Internet Association are granted in part and denied in part.

The Petitions for Reconsideration of the MSS Flexibility R&O filed by Mobile Satellite Ventures Subsidiary LLC and Inmarsat Ventures PLC are granted in part, dismissed as moot in parte, and denied in part.

The Petition for Reconsideration of the MSS Flexibility R&O filed by the Boeing Co. is granted in part and denied in part.

The Petition for Reconsideration of the Sua Sponte Order filed by the Boeing Co. is granted in part and denied in part.

The Final Regulatory Flexibility Certification, as required by section 604 of the Regulatory Flexibility Act, is adopted.

The Commission's Consumer and Governmental Affairs Bureau, Reference Information Center, shall send a copy of this Memorandum Opinion and Order and Second Order on Reconsideration, including the Final Regulatory Flexibility Certification, to the Chief Counsel for Advocacy of the Small Business Administration.

This is a summary of the Commission's Sixth Report and Order, in CC Docket No. 92-105, FCC 05-59, released March 14, 2005. The full text of this document is available for public inspection during regular business hours in the FCC Reference Center, Room CY-A257, 445 12th Street, SW., Washington, DC 20554.

1. In this Sixth Report and Order (6th R&O), released on March 14, 2005, we designate 811 as the national abbreviated dialing code to be used by state One Call notification systems for providing advanced notice of excavation activities to underground facility operators in compliance with the Pipeline Safety Act. This Order implements the Pipeline Safety Act, which provides for the establishment of a nationwide toll-free abbreviated dialing arrangement to be used by state One Call notification systems. A One Call notification system is a communication system established by operators of underground facilities and/or state governments in order to provide a means for excavators and the general public to notify facility operators in advance of their intent to engage in excavation activities. We also address various implementation issues in this Order. Specifically, we:

• Require One Call Centers to notify carriers of the toll-free or local number the One Call Center uses in order to ensure that callers do not incur toll charges, as mandated by the statute;

• Allow carriers to use either the Numbering Plan Area (NPA)-NXX or the originating switch to determine the appropriate One Call Center to which a call should be routed;

• Require the use of 811 as the national abbreviated dialing code for providing advanced notice of excavation activities to underground facility operators within two years after publication of this Order in the Federal Register; and

• Delegate authority to the states, pursuant to section 251(e), to address the technical and operational issues associated with the implementation of the 811 code.

2. The 811 abbreviated dialing code shall be deployed ubiquitously by carriers throughout the United States for use by all telecommunications carriers, including wireline, wireless, and payphone service providers that provide access to state One Call Centers. This designation shall be effective May 13, 2005.

1. Designation of 811 as a National Abbreviated Dialing Code

3. Background. In the Notice of Proposed Rulemaking, (NPRM), 69 FR 31930, June 8, 2004, we sought comment on whether to use an N11 code for access to One Call Centers. Specifically, we sought comment on the North American Numbering Council's (NANC) recommendation to assign 811 for this purpose. We also asked commenters to address whether we should incorporate the One Call access service into an existing N11 code, such as 311 or 511, to preserve the remaining unassigned N11 codes. The NANC expressed concern that shared use could cause caller confusion, misrouted calls, and deployment delay. We requested commenters that advocated shared use of an existing N11 code to propose solutions to mitigate the concerns expressed by the NANC.

4. Discussion. In this Order, we conclude that an N11 code is the best solution, within the framework of the statute, for access to One Call Centers. Thus, consistent with the statutory mandate, we designate 811 as the national abbreviated dialing code to be used by state One Call notification systems for providing advanced notice of excavation activities to underground facility operators in compliance with the Pipeline Safety Improvement Act. In so doing, we reject the other options considered by the NANC and posed in the NPRM. We agree with commenters that other alternatives—codes using a leading star or number sign, e.g. *344 or #344 and an Easily Recognizable Code (ERC), such as 344—are impractical, costly to implement, and could delay the availability of a national One Call number for years. Moreover, dialing arrangements in the format of *XXX or #XXX, in as much as these codes include three digits following the leading star or number sign, do not comply with the statute's requirement to utilize a nationwide “three-digit number” to access One Call Centers. We believe that 811 will have less impact on customer dialing patterns and can be implemented without the substantial cost and delay of switch development required with the other proposed alternatives. We also agree with the U.S. Department of Transportation (DOT) that the special nature of an N11 code makes the 811 code amenable to a public education campaign linking it to One Call Centers. We reject APCC's request to exempt payphone service providers from this requirement. In contrast to the Act's clear mandate of a nationwide toll-free three-digit code for access to One Call Centers, APCC provides no credible argument for an exemption. The Act does not provide any exemptions from this requirement, and we decline to do so here.

5. Although we recognize that using 811 depletes the quantity of remaining N11 codes assignable for other purposes, using an N11 code to access One Call Centers will consume fewer numbering resources than certain other alternative abbreviated dialing arrangements. Additionally, the use of an N11 code to access One Call services follows the existing conventions for abbreviated dialing already familiar to customers. The N11 architecture is an established abbreviated dialing plan that is recognized by switch manufacturers and the public at large. Most significantly, using an N11 code such as 811 satisfies the legislative mandate for a three-digit nationwide number.

6. We share the concerns of commenters regarding the shared use of an existing N11 code, such as 511 (which is currently used for travel and information services) or 311 (which is currently used for non-emergency police and other governmental services). In this instance, due to the volume of calls received by state One Call Centers, shared use of an existing N11 code could result in customer confusion and misrouting when dialing a shared N11 code. Thus, excavators could be deterred from using the notification system, thereby reducing the effectiveness of the One Call Centers. The Common Ground Alliance (CGA) estimates that the One Call Centers currently receive approximately 15 million calls annually. It also estimates that 40 percent of the incidents where underground facilities are damaged were caused by those who did not call before digging. CGA contends that the incoming call volume to One Call Centers over the next few years may well exceed 20 million calls. Thus, integration of state One Call Centers with existing N11 systems may also increase implementation costs while adding unnecessary complexity to the One Call notification program. Further, shared use of an existing N11 code for access to state One Call Centers could also delay deployment due to the need to reach agreement with the existing users of the N11 code to be integrated and national advertising efforts to educate users on the shared use of the N11 code. For these reasons, we reject the use of an existing N11 code as opposed to the approach adopted in this Order.

7. Background. In the NPRM, we sought comment on DOT's initial proposal to establish the digits “344” or any other mnemonic three-digit dialing arrangement for access to One Call Centers. We tentatively concluded that because 344 corresponds to an ERC, an abbreviated dialing code in the format of an Easily Recognizable Code (ERC) or other area code would be inconsistent with our numbering resource optimization policies by potentially rendering eight million North American Numbering Plan (NANP) telephone numbers unusable. We specifically sought comment on the technical and operational issues raised by the NANC and whether there are existing measures that can address these issues. We also sought comment as to the extent switch development or replacement may be needed and the impact this will have on nationwide implementation.

8. Discussion. We conclude that an abbreviated dialing code in the format of an ERC or other area code would be inconsistent with our numbering resource optimization policies by rendering approximately eight million NANP telephone numbers unusable. We agree with commenters that the selection of an ERC for this purpose would not be in the public interest because it would accelerate NANP exhaust. Further, the establishment of 344 as an abbreviated dialing code may cause customer confusion and frustration for customers by misrouting callers to the One Call Center where 344 is a working NXX code. Additionally, from a technical perspective, some switches would require either replacement or development work that could delay the capability of using the 344 code as a three-digit number for a number of years. For example, Verizon comments that vendor development for the affected switches would require new technical specifications, code preparation, installation, testing, and release of generic software release prior to distribution. In light of these technical and practical challenges, we do not establish 344 as the One Call abbreviated dialing code.

9. Background. In the NPRM, we sought comment on whether a code with a leading star or number sign, in the format of either *XXX or #XXX, should be used to access One Call Centers. We sought comment on the extent to which using a code with a leading star or number sign will either promote or discourage exhaust of the NANP numbers. We asked parties to discuss any existing measures that can mitigate or alleviate the limitations with using a leading star or number sign. We also sought comment on whether calls from wireless customers to One Call Centers should continue to be permitted because of the effort that has gone into wireless implementation of #344 (#DIG).

10. Discussion. We agree with commenters that the use of a code with a leading star or number sign, in the format of either *XXX or #XXX, for access to One Call Centers would be too difficult and costly to implement. Most significantly, as indicated above, such a dialing arrangement does not comply with the statute's requirement to utilize a nationwide “three-digit number” to access One Call Centers. Moreover, this abbreviated dialing arrangement would not achieve the uniformity mandated by the Pipeline Safety Act since all users would not be dialing the same sequence if the code selected includes a star or number sign. A single nationwide abbreviated dialing code for access to One Call Centers will provide the certainty and reliability required for maximum usage and benefits of One Call services. Additionally, many telephone systems use the star and number signs for feature access. Thus, reprogramming these systems may not always be feasible and will involve considerable customer expense. Further, some switching systems may not be capable of processing access codes using a leading star or number sign in the dialing sequences; and the necessary switch development would delay the full implementation of the One Call functionality. Based on the record before us, we conclude that *XXX and #XXX are impractical for use as the national One Call access code and we will not assign a code using a leading star or number sign for access to One Call Centers.

11. Although we recognize the efforts undertaken in the implementation of #344 by some wireless carriers, we disagree with those commenters who advocate the continued and indefinite use of #344 for access to One Call Centers. We agree with DOT that a single nationwide abbreviated dialing code for access to One Call Centers will provide the certainty and reliability required for maximum usage and benefits of One Call services as intended by Congress. The #344 abbreviated dialing arrangement does not comply with the statute's requirement to utilize a nationwide “three-digit number” to access One Call Centers and the statutory mandate that dialing be uniform across the nation. The use of different abbreviated dialing codes for access to state One Call Centers, even if such codes are made available in addition to 811, likely will result in customer confusion as the public use both wireless and wireline telephones. Wireless carriers that currently use #344 shall transition to 811 pursuant to the implementation requirements.

12. Background. The Pipeline Safety Act expressly mandates use of a three-digit toll-free number to access State One Call Centers. In the NPRM, we sought comment on methods to ensure that calls to One Call Centers are toll-free. We specifically sought comment on the NANC's recommendation that each One Call Center provide a toll-free number, which can be an 8YY number or any number that is not an IntraLATA toll call from the area to be served, so that callers do not incur toll charges. We also sought comment on whether the dialing sequence should be the same for all providers or whether existing abbreviated dialing sequences should be allowed to continue.

13. Discussion. To ensure that calls to One Call Centers are toll-free, we conclude that One Call Centers shall provide to carriers its toll-free number, which can be an 8YY number, or any number that is not an IntraLATA toll call, from the area to be served for use in implementing 811. Thus, when a caller dials 811, the carriers will translate 811 into the appropriate number to reach the One Call Center. This requirement will both simplify call routing and ensure that callers do not incur toll charges, as mandated by the statute. As discussed above, other existing abbreviated dialing sequences shall be discontinued, because the use of other existing abbreviated dialing sequences in addition to 811 does not comply with the statutory mandate that dialing be uniform across the nation.

14. Background. In establishing a framework for its evaluation of various abbreviated dialing arrangements to implement the Pipeline Safety Act, the NANC proposed that for wireline-originated calls, the originating NPA-NXX would determine the One Call Center to which the call is sent. For wireless-originated calls, the NANC proposed that the originating Mobile Switch Center would determine the One Call Center to which the call is sent. In the NPRM, we sought comment on these proposals.

15. Discussion. We direct carriers to use either the NPA-NXX or the originating switch to determine the appropriate One Call Center to which a call should be routed. For wireline-originated calls, the originating switch location or the NPA-NXX will determine the One Call Center to which the call is sent. For wireless-originated calls, the originating Mobile Switch Center will determine the One Call Center to which the call is sent. This approach allows all carriers the flexibility to utilize the most efficient and cost-effective method for routing calls to appropriate state One Call Center and is competitively neutral.

16. Background. In the NPRM, we sought comment on several issues relating to how much time carriers should be given to implement a new national abbreviated dialing code. Specifically, we sought comment on how long the implementation period for each proposed abbreviated dialing arrangement should be. We asked parties to comment on all of the steps that carriers must undertake to prepare the network for use of the three abbreviated dialing arrangements proposed in the NPRM to route properly such calls to the One Call Centers. We also sought comment on what time limit should be given to carriers to vacate any existing uses, if an unassigned N11 code, such as 811, were selected to access One Call Centers. Further, we specifically sought comment on the technical and operational issues that should be considered when determining the time period for implementation that would allow carriers to prepare for use of the proposed abbreviated dialing arrangement that was adopted. We also sought comment on the NANC's recommendation that we allow carriers one to two years to prepare the network to support One Call notification to existing One Call Centers. Additionally, we sought comment on whether the period for implementation should be uniform or variable and based on local conditions and whether, pursuant to section 251(e), we should delegate authority to the states to establish the timeframe for implementation and how best to engage states in the implementation process.

17. Discussion. With regard to how much time carriers will need to implement 811, we find that, based on the record before us, two years from publication of this Order in the Federal Register is a reasonable time period for implementing 811. Most commenters generally agree that two years is a sufficient period for implementing an N11 code, specifically 811, for access to One Call Centers. Thus, we conclude that calls to One Call Centers using an abbreviated dialing code must use 811 as the national abbreviated dialing code for providing advanced notice of excavation activities to underground facility operators on or before two years from publication of this Order in the Federal Register. We defer to the expertise of the carriers, in cooperation with the individual states, to develop and determine the most appropriate technological means of implementing 811 access to One Call services, as dictated by their particular network architectures.

18. Although the Commission has allowed the local use of unassigned N11 codes, it has recognized that this use must be discontinued on short notice. The record indicates that the 811 code, while not formally allocated by a Commission order, is being used in several jurisdictions for other purposes. For example, 811 is used in some areas to allow customers to make free repair calls and as a 911 test code. Specifically, in some of its states, SBC Communications (SBC) uses 811 as a test code for 911 prior to “turning up” new 911 trunk groups. SBC asserts therefore that designing a new code for testing will take some time because SBC must be able to test new 911 trunk groups to ensure they operate correctly. SBC also currently uses 811 in Connecticut for its business offices. Thus, in certain states, implementing the 811 solution will require time and effort.

19. American Public Communications Council (APCC) also notes that many independent payphone service providers currently use 811 to allow the general public to make free repair calls from payphones. APCC argues that it would be costly to implement 811 because it would require payphones to be reprogrammed and a change of signage informing payphone users of the new repair code. We agree with SBC that where 811 have been used by customers for other purposes, changing the use of that number will require more robust customer education. Additionally, changes to phone books, methods and procedures, and systems will require significantly more time where 811 was previously used for other purposes. For the foregoing reasons, we believe two years provides a reasonable transition period to clear the 811 abbreviated dialing code of any other existing uses, provide customer education, and ensure that there is no unreasonably abrupt disruption of the existing uses.

20. We recognize that states have unique knowledge that will assist in implementing the transition to the One Call Center access set forth in this Order. We therefore delegate authority to the state commissions, pursuant to section 251(e), to address the technical and operational issues associated with the implementation of 811. In delegating authority to the state commissions to address the technical and operational issues, state commissions should also consider whether a carrier may need additional time to implement 811 due to such technical and/or operational difficulties. We agree with Michigan Public Service Commission (MPSC) that state commissions are in the best position to address issues associated with implementing the abbreviated dialing arrangement because many of the One Call Centers were developed by, or under the auspices of, the state commissions. For example, Qwest suggests that states be involved in mediating issues associated with customer contention in areas where multiple call centers request service in the same geographical area and be delegated authority to assess the qualifications of One Call Centers. We agree. We defer to the expertise of the states to address and resolve such issues. However, we decline to delegate authority to the state commissions, as suggested by California Public Utilities Commission and the People of the State of California (CPUC), to establish the implementation period. We agree with SBC that the statute calls for a nationwide solution and that allowing states to establish the implementation period would not meet this mandate. Therefore, as discussed above, we have established a two year period for implementing 811 as the national abbreviated dialing code for access to state One Call Centers.

21. As required by the Regulatory Flexibility Act of 1980, as amended (RFA), an Initial Regulatory Flexibility Analysis (IRFA) was incorporated in the NPRM. The Commission sought written public comment on the proposals in the NPRM, including comment on the IRFA. The Commission has prepared a Final Regulatory Flexibility Analysis (FRFA) for this Order, set forth at Appendix B.

22. This Order does not contain new or modified information collection requirements subject to the Paperwork Reduction Act of 1995 (PRA), Public Law 104-13. In addition, therefore, it does not contain any new or modified “information collection burden for small businesses 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).

23. Alternative formats (computer diskette, large print, audio recording, and Braille) are available to persons with disabilities by contacting Brian Millin at (202) 418-7426 voice, (202) 418-7365 TTY, or bmillin@fcc.gov. This Order can also be downloaded in Microsoft Word and ASCII formats at http://www.fcc.gov/ccb/universalservice/highcost.

24. As required by the Regulatory Flexibility Act of 1980, as amended (RFA), an Initial Regulatory Flexibility Analysis (IRFA) was incorporated in the Notice of Proposed Rulemaking (NPRM). The Commission sought public comments on the proposals in the NPRM, including comment on the IRFA. The comments received are discussed below. This present Final Regulatory Flexibility Analysis (FRFA) conforms to the RFA.

25. In this Order, we designate 811 as the national abbreviated dialing code to be used by state One Call notification systems for providing advanced notice of excavation activities to underground facility operators in compliance with the Pipeline Safety Improvement Act of 2002 (the “Pipeline Safety Act”). This Order implements the Pipeline Safety Act, which provides for the establishment of a nationwide toll-free abbreviated dialing arrangement to be used by state One Call notification systems.

26. A One Call notification system is a communication system established by operators of underground facilities and/or state governments in order to provide a means for excavators and the general public to notify facility operators in advance of their intent to engage in excavation activities. We also address various implementation issues. Specifically, we require One Call Centers to notify carriers of the toll-free or local number the One Call Center uses in order to ensure that callers do not incur toll charges, as mandated by the statute. We also allow carriers to use either the Numbering Plan Area (NPA) NXX or the originating switch to determine the appropriate One Call Center to which a call should be routed. Further, we require the use of 811 as the national abbreviated dialing code for providing advanced notice of excavation activities to underground facility operators within two years after publication of this Order in the Federal Register. We also delegate authority to the states, pursuant to section 251(e), to address the technical and operational issues associated with the implementation of the 811 code.

27. The 811 abbreviated dialing code shall be deployed ubiquitously by carriers throughout the United States for use by all telecommunications carriers, including wireline, wireless, and payphone service providers that provide access to state One Call Centers. The designation of 811 for access to state One Call Centers shall be effective thirty days after publication of this Order in the Federal Register.

28. In the IRFA, we indicated that we would consider any proposals made to minimize any significant economic impact on small entities. We received no comments directly in response to the IRFA. However, the National Telecommunications Cooperative Association (NTCA) and THG Consultants LLP (THG) filed general comments regarding the possible impact of the implementation of an N11 code on small business entities. Specifically, NTCA asserted that, although implementing 811 as the abbreviated dialing code for accessing the state One Call notification system will not cause its member companies any technical hardships; it will involve some costs and difficulties due to the need to modify switches. While NTCA did not provide detailed information on implementation costs, NTCA contended that the burdens associated with implementation of the 811 code would have a greater impact on smaller companies with limited staffing and a smaller subscriber base. THG argued that if an unassigned N11 code is selected to access One Call Centers, then existing commercial uses of this code should continue for commercial purposes until a qualified entity applies for develops the capability to put the code into use for One Call access. THG is concerned that, where an unassigned N11 code is selected for One Call access, small businesses engaged in commercial activities may be adversely affected and the public deprived of an existing service. The steps taken to minimize economic impact on small entities are discussed below.

29. 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 the rules. 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 which: (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).

30. We have included small incumbent local exchange carriers in this present RFA analysis. As noted above, a “small business” under the RFA is one that, inter alia, meets the pertinent small business size standard (e.g., a telephone communications business having 1,500 or fewer employees), and “is not dominant in its field of operation.” The SBA's Office of Advocacy contends that, for RFA purposes, small incumbent local exchange carriers are not dominant in their field of operation because any such dominance is not “national” in scope. We have therefore included small incumbent local exchange carriers in this RFA analysis, although we emphasize that this RFA action has no effect on Commission analyses and determinations in other, non-RFA contexts.

31. Incumbent Local Exchange Carriers. Neither the Commission nor the SBA has developed a small business size standard specifically for incumbent local exchange services. The appropriate size standard under SBA rules is for the category 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 have reported that they are engaged in the provision of incumbent 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 our action.

32. Competitive Local Exchange Carriers, Competitive Access Providers, “Shared-Tenant Service Providers,” and “Other Local Service Providers.” Neither the Commission nor the SBA has developed a small business size standard specifically for these service providers. The appropriate size standard under SBA rules is for the category 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 carriers have reported that they are engaged in the provision of either competitive access provider services or competitive local exchange carrier services. Of these 609 carriers, an estimated 458 have 1,500 or fewer employees and 151 have more than 1,500 employees. In addition, 16 carriers have reported that they are “Shared-Tenant Service Providers,” and all 16 are estimated to have 1,500 or fewer employees. In addition, 35 carriers have reported that they are “Other Local Service Providers.” Of the 35, 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, “Shared-Tenant Service Providers,” and “Other Local Service Providers” are small entities that may be affected by our action.

33. 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 our action.

34. 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 our action.

35. Payphone Service Providers. Neither the Commission nor the SBA has developed a small business size standard specifically for payphone services providers. The appropriate size standard under SBA rules is for the category 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 carriers have reported that they are engaged in the provision of payphone services. Of these, 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 our action.

36. Interexchange Carriers. Neither the Commission nor the SBA has developed a small business size standard specifically for providers of interexchange services. The appropriate size standard under SBA rules is for the category 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 carriers have reported that they are engaged in the provision of interexchange service. Of these, 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 IXCs are small entities that may be affected by our action.

37. Operator Service Providers. Neither the Commission nor the SBA has developed a small business size standard specifically for operator service providers. The appropriate size standard under SBA rules is for the category 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 carriers have reported that they are engaged in the provision of operator services. Of these, 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 OSPs are small entities that may be affected by our action.

38. Prepaid Calling Card Providers. Neither the Commission nor the SBA has developed a small business size standard specifically for prepaid calling card providers. The appropriate size standard under SBA rules is for the category Telecommunications Resellers. Under that size standard, such a business is small if it has 1,500 or fewer employees. According to Commission data, 37 carriers have reported that they are engaged in the provision of prepaid calling cards. Of these, 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 our action.

39. Wireless Service Providers. The SBA has developed a small business size standard for wireless firms within the two broad economic census categories of “Paging” and “Cellular and Other Wireless Telecommunications.” Under both SBA categories, a wireless business is small if it has 1,500 or fewer employees. For the census category of Paging, Census Bureau data for 1997 show that there were 1,320 firms in this category, total, that operated for the entire year. Of this total, 1,303 firms had employment of 999 or fewer employees, and an additional 17 firms had employment of 1,000 employees or more. Thus, under this category and associated small business size standard, the majority of firms can be considered small. For the census category Cellular and Other Wireless Telecommunications, Census Bureau data for 1997 show that 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. Thus, under this second category and size standard, the majority of firms can, again, be considered small.

40. Cellular Licensees. The SBA has developed a small business size standard for wireless firms within the broad economic census category “Cellular and Other Wireless Telecommunications.” Under this SBA category, a wireless business is small if it has 1,500 or fewer employees. For the census category Cellular and Other Wireless Telecommunications firms, Census Bureau data for 1997 show that 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. Thus, under this category and size standard, the great majority of firms can be considered small. According to the most recent Trends in Telephone Service data, 719 carriers reported that they were engaged in the provision of cellular service, Personal Communications Service, or Specialized Mobile Radio Telephony services, which are placed together in the data. We have estimated that 294 of these are small, under the SBA small business size standard.

41. Common Carrier Paging. The SBA has developed a small business size standard for wireless firms within the broad economic census categories of “Cellular and Other Wireless Telecommunications.” Under this SBA category, a wireless business is small if it has 1,500 or fewer employees. For the census category of Paging, Census Bureau data for 1997 show that there were 1,320 firms in this category, total, that operated for the entire year. Of this total, 1,303 firms had employment of 999 or fewer employees, and an additional 17 firms had employment of 1,000 employees or more. Thus, under this category and associated small business size standard, the great majority of firms can be considered small. In the Paging Third Report and Order and Fifth Notice of Proposed Rulemaking, 62 FR 16004, April 3, 1997, we 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 small business 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. According to the most recent Trends in Telephone Service, 433 carriers reported that they were engaged in the provision of paging and messaging services. Of those, we estimate that 423 are small, under the SBA approved small business size standard.

42. 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 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 wireless communications services. In the auction, there were seven winning bidders that qualified as “very small business” entities, and one that qualified as a “small business” entity.

43. Wireless Telephony. Wireless telephony includes cellular, personal communications services, and specialized mobile radio telephony carriers. As noted earlier, the SBA has developed a 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. According to the most recent Trends in Telephone Service data, 719 carriers reported that they were engaged in the provision of wireless telephony. We have estimated that 294 of these are small under the SBA small business size standard.

44. 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. Subsequent events, concerning Auction 35, including judicial and agency determinations, resulted in a total of 163 C and F Block licenses being available for grant. In addition, we note 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.

45. Narrowband Personal Communications Services. To date, two auctions of narrowband PCS licenses have been conducted. For purposes of the two auctions that have already been held, “small businesses” were entities with average gross revenues for the prior three calendar years of $40 million or less. Through these auctions, the Commission has awarded a total of 41 licenses, out of which 11 were obtained by small businesses. To ensure meaningful participation of small business entities in future auctions, 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 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 auctions. However, four of the 16 winning bidders in the two previous narrowband PCS auctions were small businesses, as that term was defined. 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.

46. 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, we apply the small business size standard under the SBA rules applicable to “Cellular and Other Wireless Telecommunications” companies. This category provides that a small business is a wireless company employing no more than 1,500 persons. According to the Census Bureau data for 1997, only 12 wireless firms out of a total of 1,238 such firms that operated for the entire year, had 1,000 or more employees. 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.

47. 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 16004, April 3, 1997, we 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 Licenses, and 875 Economic Area 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.

48. 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 800 MHz and 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, respectively. 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. Consequently, the Commission estimates that there are 301 or fewer small entity SMR licensees in the 800 MHz and 900 MHz bands that may be affected by the rules and policies adopted herein.

49. 700 MHz Guard Band Licensees. In the 700 MHz Guard Band Order, 65 FR 17594, April 4, 2000, we 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 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.

50. 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. 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.

51. Air-Ground Radiotelephone Service. The Commission has not adopted a small business size standard specific to the Air-Ground Radiotelephone Service. We 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 we estimate that almost all of them qualify as small under the SBA small business size standard.

52. 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 are 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. We noted, however, that the common carrier microwave fixed licensee category includes some large entities.

53. 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. We are 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.

54. 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 polices adopted herein.

55. Multipoint Distribution Service, Multichannel Multipoint Distribution Service, and ITFS. Multichannel Multipoint Distribution Service systems, often referred to as “wireless cable,” transmit video programming to subscribers using the microwave frequencies of the Multipoint Distribution Service (MDS) and Instructional Television Fixed Service (ITFS). In connection with the 1996 MDS auction, the Commission established a small business size standard as an entity that had annual average gross revenues of less than $40 million in the previous three calendar years. The MDS auctions resulted in 67 successful bidders obtaining licensing opportunities for 493 Basic Trading Areas. Of the 67 auction winners, 61 met the definition of a small business. MDS also includes licensees of stations authorized prior to the auction. In addition, the SBA has developed a small business size standard for Cable and Other Program Distribution, which includes all such companies generating $12.5 million or less in annual receipts. 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, we estimate that the majority of providers in this service category are small businesses that may be affected by the rules and policies adopted herein. This SBA small business size standard also appears applicable to ITFS. There are presently 2,032 ITFS licensees. All but 100 of these licenses are held by educational institutions. Educational institutions are included in this analysis as small entities. Thus, we tentatively conclude that at least 1,932 licensees are small businesses.

56. 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 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, we conclude 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.

57. 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, we 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 holds interests in such an entity and its affiliates, has average annual gross revenues not to exceed $3 million for the preceding three years. We cannot estimate, however, the number of licenses that will be won by entities qualifying as small or very small businesses under our rules in future auctions of 218-219 MHz spectrum.

58. 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, 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. Thus, under this size standard, the great majority of firms can be considered small. These broader census data notwithstanding, we believe 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 our 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.

59. 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.

60. In the IRFA, we invited comment on any possible costs associated with the abbreviated dialing arrangement ultimately chosen to comply with the Pipeline Safety Act. We received five general, non-IRFA comments in response to this issue. Commenters support the North American numbering Council's (NANC) recommendation that the cost of implementing a One Call service should not be an unfunded mandate. Qwest asserts that, although past N11 deployments have not typically involved federal cost recovery, state regulatory commissions are not uniform in the way in which they resolve cost recovery matters associated with N11 deployments. Specifically, the American Public Communications Council (APCC) contends that if payphone service providers are not excluded from the statutory mandate, then they should also be compensated for such calls.

61. While we recognize that there may be some costs associated with implementation of the 811 code, we have not specified parameters for cost recovery in this Order. The Pipeline Safety Act did not provide for federal financial support as part of the mandate for a nationwide abbreviated dialing arrangement for access to One Call Centers. Therefore, we find that the Congressional mandate and benefits of a national N11 code assignment, specifically 811, outweigh any concerns regarding cost recovery on the federal level. These issues are most appropriately addressed by the state and local governments. As indicated above, we believe that state commissions are in the best position to address issues associated with implementing 811 because many of the One Call Centers were developed by, or under the auspices of, the state commissions.

62. The RFA requires an agency to describe any significant, specifically small business, 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.

63. In adopting 811 as the national abbreviated dialing code for access to One Call Centers, we have taken steps to minimize the impact on small entities. The overall objective of this proceeding was to assess possible abbreviated dialing arrangements to use to access state One Call Centers as mandated by the Pipeline Safety Act, while at the same time, seeking to minimize any adverse impact on numbering resources. We, therefore, sought comment on various abbreviated dialing arrangements, including those considered and recommended by the NANC, that could be used by state One Call notification systems in compliance with the Pipeline Safety Act while at the same time minimizing, to the extent possible, any adverse impact on numbering resources, including any impact on small entities.

64. After reviewing the comments and considering the possible abbreviated dialing arrangements that could be used by state One Call notification systems in compliance with the Pipeline Safety Act, we conclude that an N11 code is the best solution, within the framework of the statute, for access to One Call Centers. Thus, consistent with the statutory mandate, we designate 811 as the national abbreviated dialing code to be used by state One Call notification systems for providing advanced notice of excavation activities to underground facility operators in compliance with the Pipeline Safety Act. We agree with commenters that the other proposed alternatives—codes using a leading star or number sign, e.g. *344 or #344, and the establishment of an Easily Recognizable Code (ERC), such as 344, as an abbreviated dialing code are impractical, costly to implement, and could delay the availability of a national One Call number for years. Moreover, this abbreviated dialing arrangement would not achieve the uniformity mandated by the Pipeline Safety Act since all users would not be dialing the same sequence if the code selected includes a star or number sign. We believe that 811 will have less impact on customer dialing patterns and can be implemented without the substantial cost and delay of switch development required with other proposed alternatives.

65. Although we recognize that using 811 depletes the quantity of remaining N11 codes assignable for other purposes, using an N11 code to access One Call Centers will consume fewer numbering resources than certain other alternative abbreviated dialing arrangements. Additionally, the use of an N11 code to access One Call services follows the existing conventions for abbreviated dialing already familiar to customers. The N11 architecture is an established abbreviated dialing plan that is recognized by switch manufacturers and the public at large. Most significantly, using an N11 code such as 811 satisfies the legislative mandate for a three-digit nationwide number.

66. Further, although the Commission has allowed the local use of unassigned N11 codes, it has recognized that this use must be discontinued on short notice. In order to minimize the impact of our action, including the impact on small business entities, we provide a two year period, from publication of this Order in the Federal Register, for implementing the 811 code. Based on the record before us, we believe two years from publication of this Order in the Federal Register is a reasonable time period for implementation of 811. The alternative of not providing for a transition period was considered but rejected because we believe a transition period is necessary to provide all telecommunications carriers, including wireline, wireless, and payphone service providers, sufficient time to make the necessary network modifications or upgrades, as well as integrate existing One Call notification systems, thus minimizing any adverse or unfair impact on smaller entities. In addition, this transition period will give carriers time to clear this number of any other existing uses, provide customer education, and ensure that there is no unreasonably abrupt disruption of the existing uses.

67. The Commission will send a copy of the Order, including this FRFA, to the Chief Counsel for Advocacy of the Small Business Administration. A copy of the Order and FRFA (or summaries thereof) will also be published in the Federal Register.

68. Pursuant to the authority contained in sections 1, 4(i), 4(j), 201-205, 214, 254, and 403 of the Communications Act of 1934, as amended, this Sixth Report and Order is adopted.

69. Pursuant to section 251(e)(3) of the Communications Act of 1934, as amended, 47 U.S.C. 251(e)(3), 811 is assigned as the national abbreviated dialing code to be used exclusively for access to Once Call Centers, effective May 13, 2005.

70. The Commission's Consumer and Governmental Affairs Bureau, Reference Information Center, shall send a copy of this Order, including the Final Regulatory Flexibility Analysis, to the Chief Counsel for Advocacy of the Small Business Administration.

71. The Commission will not send a copy of this Order pursuant to the Congressional Review Act, see 5 U.S.C. 801(a)(1)(A), because no rules were adopted or changed.

This is a summary of the Commission's Second Order on Reconsideration, CG Docket No. 02-278, FCC 05-28, adopted February 10, 2005, and released February 18, 2005 (Order). The Order addresses issues arising from Rules and Regulations Implementing the Telephone Consumer Protection Act of 1991, Report and Order, (2003 TCPA Order), CG Docket No. 02-278, FCC 03-153, released July 3, 2003; published at 68 FR 44144, July 25, 2003. This document does not contain new or modified information collection requirements subject to the Paperwork Reduction Act of 1995 (PRA), Public Law 104-13. In addition, it does not contain new or modified “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). Copies of any subsequently filed documents in this matter will be available for public inspection and copying during regular business hours at the FCC Reference Information Center, Portals II, Room CY-A257, 445 12th Street, SW., Washington, DC 20054. The complete text of this decision may be purchased from the Commission's duplicating contractor, Best Copy and Printing, Inc. (BCPI), Portals II, 445 12th Street, SW., Room CY-B402, Washington, DC 20554. Customers may contact BCPI, Inc. at its Web site: http://www.bcpiweb.com or call 1-800-378-3160. To request materials in accessible formats for people with disabilities (Braille, large print, electronic files, audio format), send an e-mail to fcc504@fcc.gov or call the Consumer & Governmental Affairs Bureau at (202) 418-0530 (voice) or (202) 418-0432 (TTY). The Order can also be downloaded in Word and Portable Document Format (PDF) at http://www.fcc.gov/cgb/policy.

In the 2003 TCPA Order, the Commission adopted a national do-not-call registry, in conjunction with the FTC, to provide residential consumers with a one-step option to prohibit unwanted telephone solicitations. Telemarketers are prohibited from contacting those consumers that register their telephone numbers on the national list, unless the call falls within a recognized exemption. We explained that calls that do not fall within the definition of “telephone solicitation” as defined in section 227(a)(3) are not restricted by the national do-not-call list. These may include surveys, market research, political and religious speech calls. The national do-not-call rules also do not prohibit calls by or on behalf of tax-exempt nonprofit organizations, calls to persons with whom the seller or telemarketer has an established business relationship, calls to businesses, and calls to persons with whom the marketer has a “personal relationship.”

A number of petitioners raise questions related to the administration and operation of the national do-not-call registry. The DMA requests that the Commission review the national do-not-call registry set up by the FTC and reconsider our rules to impose more reasonable security procedures for the registry. In addition, the DMA asks the FCC to require the DNC list administrator to provide a mechanism by which callers can download the national list without wireless numbers. Several other petitioners request that the Commission reconsider the extent to which states may apply their do-not-call requirements to interstate telemarketers. We note that, since the close of the filing period for petitions for reconsideration, the Commission has received several petitions for declaratory ruling seeking preemption of state telemarketing laws. The Commission intends to address the issue of preemption separately in the future.

The Commission also received petitions asking whether certain entities or certain types of calls are subject to the national do-not-call rules. The National Association of Realtors (NAR) asks us to clarify that the do-not-call rules do not apply to certain practices that are “unique to the real estate industry.” Specifically, NAR argues that calls from real estate agents to individuals who have advertised their properties as “For Sale By Owner” fall outside the scope of the do-not-call rules. In addition, NAR requests that the Commission clarify that the rules permit real estate professionals to call individuals whose listing with another agent has lapsed. Independent Insurance Agents ask the Commission to reconsider our determinations that insurance agents are subject to the TCPA and that there should be no exemption for calls made based on referrals. The State and Regional Newspaper Association asks the Commission to reconsider its treatment of newspapers under the do-not-call rules in view of the constitutional protection newspapers are accorded.

As discussed below, we dismiss the foregoing petitions to the extent they seek reconsideration of the rules establishing the national do-not-call registry. Many of the same issues regarding the do-not-call registry were raised during the original proceeding and were addressed in the 2003 TCPA Order. In conjunction with the FTC, we will continue to monitor closely the operation of the list to ensure its continued effectiveness. We are not persuaded by the State & Regional Newspaper Association that we need to revisit our rules. The State and Regional Newspaper Associations argue that the Commission cannot justify application of the new telemarketing rules under the “limited constitutional analysis” offered in the 2003 TCPA Order. They argue instead that, pursuant to a line of judicial decisions involving licensing schemes for the distribution of newspapers, the Commission's rules must be justified under the standards “applicable to fully protected speech.”

In February 2004, the United States Court of Appeals for the 10th Circuit held that the Commission's “opt-in telemarketing regulation[s] that provide a mechanism for consumers to restrict commercial sales calls but do not provide a similar mechanism to limit charitable or political calls” are “consistent with First Amendment requirements.” Thus, our do-not-call rules are constitutional.

We recognize, however, that no party to that case specifically raised the issue of the standard of First Amendment protection afforded the distribution of newspapers before the court. After careful review of the State Newspaper Association's argument, however, we conclude that it is incorrect. To be sure, the right to distribute newspapers is afforded First Amendment protection. But a call from a telemarketer to an unwilling listener in their home for the purpose of selling a newspaper subscription remains speech which does “no more than propose a commercial transaction.”

Although the State Newspaper Association cites to a number of decisions noting that newspapers have been afforded First Amendment protection in the distribution of their newspapers, these cases typically deal with licensing cases that vest “unbridled discretion” in a government official over whether to permit or deny distribution of the publication at all. By contrast, our rules simply permit a private individual, not a government official, to decide whether or not to entertain a subscription request in their home. Indeed, the Supreme Court upheld a statute that directed the Postmaster General to send an order directing a mail sender to delete the name of an addressee if that addressee requests the removal of his name from the sender's mailing list: The Court has traditionally respected the right of a householder to bar, by order or notice, solicitors, hawkers, and peddlers from his property. In this case the mailer's right to communicate is circumscribed only by an affirmative act of the addressee giving notice that he wishes no further mailings from that mailer * * * In effect, Congress has erected a wall—or more accurately permits a citizen to erect a wall—that no advertiser may penetrate without his acquiescence.

The do not call rules directly advance the government's substantial interests in guarding against fraudulent and abusive solicitations and facilitating the protection of consumer privacy in the home even when the product sought to be sold is a newspaper. We therefore reject the State Newspaper Association's constitutional arguments.

In addition, we disagree with the DMA that the rules should be revised to expressly exempt calls to business numbers. The 2003 TCPA Order provided that the national do-not-call registry applies to calls to “residential subscribers” and does not preclude calls to businesses. To the extent that some business numbers have been inadvertently registered on the national registry, calls made to such numbers will not be considered violations of our rules. We also decline to exempt from the do-not-call rules those calls made to “home-based businesses'; rather, we will review such calls as they are brought to our attention to determine whether or not the call was made to a residential subscriber.

We also find no basis to further exempt certain entities or calls from the national do-not-call rules. The TCPA defines a telephone solicitation as “the initiation of a telephone call or message for the purpose of encouraging the purchase or rental of, or investment in, property, goods, or services, which is transmitted to any person but does not include a call or message to any person with that person's prior express invitation or permission; to any person with whom the caller has an established business relationship; or by a tax-exempt nonprofit organization.” As with any entity making calls that constitute “telephone solicitations,” a real estate agent, insurance agent, or newspaper is precluded from calling consumers registered on the national do-not-call list, unless the calls would fall within one of the specific exemptions provided in the statute and rules. Therefore, we clarify that a telephone solicitation would include calls by real estate agents to property owners for the purpose of offering their services to the owner, whether the property listing has lapsed or not. In addition, a person who, after seeing an advertisement in a newspaper, calls the advertiser to offer advertising space in the same or different publication, is making a telephone solicitation to that advertiser. We find, however, that calls by real estate agents who represent only the potential buyer to someone who has advertised their property for sale, do not constitute telephone solicitations, so long as the purpose of the call is to discuss a potential sale of the property to the represented buyer. The callers, in such circumstances, are not encouraging the called party to purchase, rent or invest in property, as contemplated by the definition of “telephone solicitation.” They are instead calling in response to an offer to purchase something from the called party. Similarly, a recruiter calling to discuss potential employment or service in the military with a consumer is not making a “telephone solicitation” to the extent the called party will not be asked during or after the call to purchase, rent or invest in property, goods or services. A caller responding to a classified ad would not be making a telephone solicitation, provided the purpose of the call was to inquire about or offer to purchase the product or service advertised, rather than to encourage the advertiser to purchase, rent or invest in property, goods or services. In addition, as explained in the 2003 TCPA Order, calls constituting telephone solicitations to persons based on referrals are nevertheless subject to the do-not-call rules, if not otherwise exempted.

Finally, we deny Insurance Agents' petition to the extent it requests that we amend our safe harbor provision to account for “good faith calls” that violate the rules and to accommodate call back technologies that have the potential to run afoul of the rules. We believe the existing safe harbor provision sufficiently addresses calls made in error by telemarketers that have made a good faith effort to comply with the rules. Consistent with the FTC, we concluded that a seller or telemarketer will not be liable for violating the national do-not-call rules if it can demonstrate that it has met certain standards, including using a process to prevent telemarketing to any telephone number on the national do-not-call registry using a version of the registry obtained from the registry administrator no more than 31 days prior to the date any call is made.

The Commission's rules require that, beginning January 1, 2004, common carriers shall “when providing local exchange service, provide an annual notice, via an insert in the subscriber's bill, of the right to give or revoke a notification of an objection to receiving telephone solicitations pursuant to the national do-not-call database maintained by the Federal government and the methods by which such rights may be exercised by the subscriber.” This notice must be clear and conspicuous and include, at a minimum, the Internet address and toll-free number that residential telephone subscribers may use to register on the national database. Verizon asks the Commission to reconsider this requirement, arguing that an annual notice is expensive and unnecessary. Alternatively, Verizon asks the Commission to clarify that other forms of notification, such as messages on telephone bills or in telephone directories, satisfy the TCPA requirement and at a much lower cost than bill inserts.

The TCPA provides that if the Commission adopts a national do-not-call database, such regulations shall “require each common carrier providing telephone exchange service * * * to inform subscribers for telephone exchange service of the opportunity to provide notification * * * that such subscriber objects to receiving telephone solicitations.” In implementing this provision, the Commission adopted a rule requiring such notice to be made on an annual basis. While many residential subscribers have already placed their numbers on the national do-not-call registry, others may wish to do so in the future or may need to place a different number on the registry because of a move or change in service. Still others may decide subsequently to remove their numbers from the registry. Therefore, we disagree with Verizon that such annual notification, which includes the registry's toll-free telephone number and Internet address established by the FTC, is unnecessary.

Upon further consideration, we will allow common carriers to provide the notice required by 47 U.S.C. 227(c)(3)(B) through either a bill insert or a separate message on the bill itself. Such notice may also appear on an Internet bill that the subscriber has opted to receive. We believe that bill messages may be a less expensive and an efficient alternative to a separate page in the bill for some carriers, and will nevertheless comply with the TCPA. We emphasize, however, that the notice, whether appearing on the actual bill or on a separate page in the bill, must be clear and conspicuous and include, at a minimum, the Internet address and toll-free number that residential telephone subscribers may use to register on or remove their numbers from the national database.

In the 2003 TCPA Order, the Commission determined that company-specific do-not-call lists should be retained in order to provide consumers with an additional option for managing telemarketing calls. In addition, we concluded that the retention period for records of those consumers requesting not to be called should be reduced from ten years to five years. Petitioner Biggerstaff seeks clarification on how the five-year retention requirement applies to do-not-call requests made prior to the effective date of the amended rule. He argues that in fairness to consumers, any do-not-call request made prior to the effective date of the new rule must be honored by the telemarketer or seller for the original ten-year period. SBC and MCI disagree and urge the Commission to clarify that telemarketers are required to honor company-specific do-not-call requests for five years from the date any request is made, including those requests made prior to the Commission's ruling. Petitioner Brown asks the Commission to reduce the period of time by which a telemarketer must honor company-specific do-not-call requests from 30 days to 24 hours. We conclude that any do-not-call request made of a particular company must be honored for a period of five years from the date the request is made, whether the request was made prior to the effective date of the amended rule or after the rule went into effect. Telemarketers may remove those numbers from their company-specific do-not-call lists that have been on their lists for a period of five years or longer. As explained in the 2003 TCPA Order, we believe a five-year retention period reasonably balances any administrative burden on consumers in requesting not to be called with the interests of telemarketers in contacting consumers. The shorter retention period increases the accuracy of companies' do-not-call databases while the national do-not-call registry option mitigates the burden on those consumers who may find company-specific do-not-call requests overly burdensome. We also believe that having two different retention periods—one for requests made prior to the effective date of the amended rule and one for requests made after—will lead to confusion among consumers and increase administrative burdens on telemarketers.

In addition, we decline to amend the timeframe by which telemarketers must honor do-not-call requests. In concluding that telemarketers must honor such requests within 30 days, we considered both the large databases of such requests maintained by some entities and the limitations on certain small businesses. We also determined that telemarketers with the capability to honor company-specific do-not-call requests in less than thirty days must do so. We continue to believe that this requirement adequately balances the privacy interests of those consumers that have requested not to be called with the interests of the telemarketing industry. We also decline to amend our determination regarding the hours a telemarketer must be available to record do-not-call requests from consumers making inbound calls to that telemarketer. In the 2003 TCPA Order, we concluded that the number supplied by the telemarketer must permit an individual to make a do-not-call request during the hours of 9 a.m. and 5 p.m. Monday through Friday. Telemarketers are already required to record do-not-call requests at the time the request is made, such as during a live solicitation call. Thus, we believe that in those instances where the consumer must instead contact the telemarketer at the telemarketer's number, it is reasonable to do so during “normal” business hours when most consumers are likely to call.

Finally, the rules as adopted in July of 2003 contain a minor error in wording which is being corrected by this Order. In § 64.1200(d)(6), the word “caller's” should be replaced with the word “consumer's.” We correct the sentence to read: “A person or entity making calls for telemarketing purposes must maintain a record of a consumer's request not to receive further telemarketing calls.”

The TCPA expressly exempts calls to persons with whom the caller has an “established business relationship” (EBR) from the restrictions on telephone solicitations. Congress determined that such an exemption was necessary to allow companies to communicate by telephone with their existing customers. Consistent with the FTC, we modified the definition of established business relationship so that the relationship, once begun, exists for 18 months in the case of purchases or transactions and three months in the case of inquiries or applications, unless the consumer “terminates” it by, for example, making a company-specific do-not-call request. ACLI asks the Commission to clarify that an “established business relationship” exists: (1) Between a person and his or her insurer as long as there is an insurance policy or annuity in force between the company and the person; and (2) between the person and his or her insurance agent, as long as there is an insurance policy or annuity in force that was placed by that insurance agent. ACLI indicates that the definition of “established business relationship” is vague as applied to the life insurance industry and does not take into account the unique aspects of the relationship between policyholders, insurers, their agents and licensed insurance professionals. ACLI maintains that insurance policies and annuities purchased by consumers represent long-term obligations of the companies that provide those policies. ACLI indicates that an insurance policy or annuity remains in force between the parties beyond the initial policy placement or renewal. Thus, ACLI contends that an EBR exists during the life of the policy even without an additional purchase, transaction or inquiry by the policyholder.

Petitioner Dowler similarly requests that the Commission clarify that an EBR exists between a mortgage broker and a consumer throughout the term of any loan that originates with the broker. Without clarification from the Commission, Dowler contends that the mortgage broker's EBR with the consumer would end 18 months after the original transaction with the broker, even though the broker established the initial relationship with the consumer. Dowler recommends that the Commission expand the rules so that an EBR exists between the broker and borrower during the length of the originating loan transaction and extends 18 months beyond the conclusion of the loan contract.

Although petitions from ACLI and Dowler were filed late, we take this opportunity to clarify application of the EBR time limitations. We agree with petitioners that a unique relationship exists between consumers and entities that enter into financial contracts or agreements. Financial “contracts” often remain in force even if the consumer is not required to make regular payments or transactions. In passing the recent Fair and Accurate Credit Transactions Act of 2003 (FACT Act), Congress provided that a “pre-existing business relationship” includes a “financial contract between a person and a consumer which is in force” or a “financial transaction (including holding an active account or a policy in force or having another continuing relationship).” We similarly clarify that the existence of financial agreements, including bank accounts, credit cards, loans, insurance policies and mortgages, constitute ongoing relationships that should permit a company to contact the consumer to, for example, notify them of changes in terms of a contract or offer new products and services that may benefit them. Consumers should not be surprised to receive a call from a bank at which they have an account, even if they have not transacted any business on that account for over 18 months. They also are likely to expect to receive calls from insurance companies with whom they hold an insurance policy or from lenders with whom they secured a mortgage. Similarly, a publication that a consumer agrees to subscribe to for a specified period of time, has an EBR with the consumer for the duration of the subscription. Thus, during the time a financial contract remains in force between a company and a consumer, there exists an established business relationship, which will permit that company to call the consumer during the period of the “contract.” Once any account is closed or any “contract” has terminated, the bank, lender, or other entity will have an additional 18 months from the last transaction to contact the consumer before the EBR is terminated for purposes of telemarketing calls. However, we emphasize that a consumer may terminate the EBR for purposes of telemarketing calls at any time by making a do-not-call request. Once the consumer makes a company-specific do-not-call request, the company may not call the consumer again to make a telephone solicitation regardless of whether the consumer continues to do business with the company.

In addition, we clarify that intermediaries, such as insurance agents and mortgage brokers, may call those consumers with whom they have arranged an insurance policy or mortgage for a period of 18 months from the time the transaction is completed, i.e., the broker/agent arranged the mortgage or insurance deal. We agree that brokers and agents often play an important role in these types of financial transactions and that, in many circumstances, the consumer would expect to receive a call from them within a reasonable period of time of the transaction. However, we believe that to allow a broker to make a telephone solicitation to a consumer for the duration of the loan or term of the policy would conflict with the do-not-call rules' purpose in protecting consumer privacy rights. In addition, a broker or agent may obtain the consumer's express written permission to call beyond the 18-month period at the time of the transaction.

The term “telephone solicitation,” as defined in the TCPA, does not include a call or message “by a tax-exempt nonprofit organization.” The Commission concluded, as part of its 1995 TCPA Reconsideration Order, published at 60 FR 42068, August 15, 1995, that calls placed by an agent of the telemarketer are treated as if the telemarketer itself placed the call. In the 2003 TCPA Order, the Commission reaffirmed this conclusion, finding that charitable and other nonprofit entities with limited expertise, resources and infrastructure, might find it advantageous to contract out its fundraising efforts. We determined that a tax-exempt nonprofit organization that conducts its own fundraising campaign or hires a professional fundraiser to do it, will not be subject to the restrictions on telephone solicitations. We also determined, however, that when a for-profit organization is delivering its own commercial message as part of a telemarketing campaign, even if accompanied by a donation to a charitable organization or referral to a tax-exempt nonprofit organization, that call is not by or on behalf of a tax-exempt nonprofit organization and is therefore subject to the “telephone solicitation” rules.

Several petitioners ask the Commission to reconsider the rules regarding calls by and on behalf of tax-exempt nonprofit organizations. DialAmerica requests that we clarify that its “Sponsor Program” is exempt from the national do-not-call registry because the calls it makes are on behalf of a tax-exempt nonprofit entity, and not on behalf of a for-profit seller. Petitioner Biggerstaff, on the other hand, asks us to reconsider our determination regarding calls made by or on behalf of tax-exempt nonprofit organizations, arguing that exempting calls from the definition of “telephone solicitation,” when they are made by a for-profit telemarketer on behalf of the nonprofit, violates Congressional intent and the plain language of the statute. We now reaffirm our determination regarding for-profit companies that call to encourage the purchase of goods or services, yet donate some of the proceeds to a nonprofit organization. In circumstances where telephone calls are initiated by a for-profit entity to offer its own, or another for-profit entity's products for sale—even if a tax-exempt nonprofit will receive a portion of the sale's proceeds—such calls are telephone solicitations as defined by the TCPA. We distinguish these types of calls from those initiated, directed and controlled by a tax-exempt nonprofit for its own fundraising purposes. We believe that to exempt for-profit organizations merely because a tax-exempt nonprofit organization is involved in the telemarketing program would undermine the purpose of the do-not-call registry. Thus, we decline to exempt DialAmerica's Sponsor Program from the national do-not-call registry.

We emphasize that a tax-exempt nonprofit organization that simply contracts out its fundraising efforts will not be subject to the restrictions on telephone solicitations. Although Petitioner Biggerstaff describes certain entities that purport to be calling on behalf of tax-exempt nonprofits to evade the rules, the record does not warrant reversing this determination. Instead, we will address such potential violations on a case-by-case basis through the Commission's enforcement process.

Under the Commission's rules, telemarketers must ensure that any technology used to dial telephone numbers abandons no more than three percent of calls answered by a person, measured over a 30-day period. A call will be considered abandoned if it is not transferred to a live sales agent within two seconds of the recipient's completed greeting. When a call is abandoned within the three percent maximum allowed, a telemarketer must deliver a prerecorded identification message containing only the telemarketer's name, telephone number, and notification that the call is for “telemarketing purposes.” Several petitioners and commenters raise issues related to the use of predictive dialers and the Commission's call abandonment rules. InfoCision requests that the Commission reconsider the call abandonment rate of three percent and instead adopt a five percent abandonment rate. Petitioner Brown asks us to revise the rules to prohibit the abandonment of any call which is answered by a person. Beautyrock urges the Commission to act to ensure that the FTC's rules on abandoned calls are consistent with the FCC's.

We conclude that petitioners raise no new facts suggesting the call abandonment rules should be amended or that the identification message requirement should be eliminated. We therefore dismiss such petitions to the extent they seek such action. In addition, while we do not have the authority to change the FTC's rules, we have forwarded a report to Congress which outlines the inconsistencies between the agencies' sets of rules.

The record before us revealed that consumers often face “dead air” calls and repeated hang-ups resulting from the use of predictive dialers. In addition to requiring that telemarketers limit the number of such abandoned calls to three percent of calls answered by a person, the Commission required that telemarketers deliver a prerecorded message when abandoning a call so that consumers will know who is calling them. We emphasized that the message must be limited to name and telephone number, along with a notice that the call is for “telemarketing purposes.” We cautioned that the message may not be used to deliver an unsolicited advertisement, and that additional information in the prerecorded message constituting an unsolicited advertisement would be a violation of our rules. We agree with the DMA that words other than “telemarketing purposes” may convey the purpose of the call. However, we disagree that language such as “Hi, this is Company A, calling today to sell you our services” does not constitute an unsolicited advertisement and conclude that such statement would run afoul of the rules. Therefore, we strongly encourage telemarketers to use the words “telemarketing purposes” when delivering a prerecorded identification message for an abandoned call in order to avoid delivering an unsolicited advertisement in the message.

The TCPA prohibits telephone calls to residences using an artificial or prerecorded voice to deliver a message without the prior express consent of the called party, unless the call is for emergency purposes or is specifically exempted under Commission rules. The TCPA permits the Commission to exempt calls that are non-commercial and commercial calls which do not adversely affect the privacy rights of the called party and which do not transmit an unsolicited advertisement. Since 1992, the Commission's rules have exempted from the prohibition “a call or message * * * that is made for a commercial purpose but does not include the transmission of any unsolicited advertisement.” The Commission made clear in the 2003 TCPA Order that offers for free goods or services that are part of an overall marketing campaign to sell property, goods, or services are subject to the restrictions on unsolicited advertisements. We also determined that if the call is intended to offer property, goods, or services for sale either during the call, or in the future (such as in response to a message that provides a toll-free number), that call is an advertisement.

The Commission's rules require that all prerecorded messages identify the name of the business, individual or other entity that is responsible for initiating the call, along with the telephone number of such business, other entity, or individual. The prerecorded message must contain, at a minimum, the legal name under which the business, individual or entity calling is registered to operate. The rule also requires that the telephone number stated in the message be one that a consumer can use during normal business hours to ask not to be called again. ACA International (ACA) requests clarification that the amended identification requirements for prerecorded messages do not apply to calls made for debt collection purposes. ACA states that the Commission's identification requirement as applied to debt collection calls directly conflicts with section 805(b) of the Fair Debt Collection Practices Act (FDCPA), which prohibits the disclosure of the existence of a debt to persons other than the debtor. ACA maintains that the FDCPA expressly prohibits debt collectors from communicating any information to third parties, even inadvertently, with respect to the existence of a debt. ACA states that the requirement that a debt collector transmit its registered name at the beginning of the prerecorded message potentially would trigger liability under the third party disclosure prohibition of the FDCPA. In the alternative, ACA requests that the Commission clarify that debt collectors are not required to identify their state-registered name in prerecorded messages if such identification conflicts with Federal or State laws.

In the 1995 TCPA Reconsideration Order, the Commission concluded that the rules did not require that debt collection employees give the names of their employers in a prerecorded message, which disclosure might otherwise reveal the purpose of the call to persons other than the debtor. Although we believe that it is generally in the best interest of residential subscribers that full identification of the caller be provided during any prerecorded message call, the FDCPA clearly prohibits the disclosure by debt collectors of any information regarding the existence of a debt. It requires a collector initiating a call answered by a third party to identify himself by name but not to disclose the name of his employer unless asked. We therefore clarify that as long as the call is made for the purpose of debt collection and is not “for the purpose of encouraging the purchase or rental of, or investment in, property, goods or services * * *,” the debt collector is not required to identify its state-registered name in prerecorded messages if such identification conflicts with Federal or State laws. In such circumstances where a conflict would exist, we find that the caller may instead identify himself by individual name. We continue to require any debt collector to state clearly the telephone number (other than that of the autodialer or prerecorded message player that placed the call) of such business, other entity, or individual.

The American Resort Development Association (ARDA) asks the Commission to permit entities to make prerecorded, “information-only” calls to numbers that are not on the national do-not-call list or a company-specific do-not-call list. ARDA explains that timeshare providers use such messages to describe promotional opportunities, but that consumers are not encouraged to purchase anything on the phone. If the consumer returns the call to learn more, the operator informs the consumer about promotional activities at a nearby resort. ARDA contends that prohibiting such prerecorded message calls is not necessary to safeguard consumers' privacy or prevent unscrupulous conduct. ARDA further argues that the Commission's determination regarding such messages violates the First Amendment rights of consumers who wish to receive such calls. Shields opposes ARDA's petition, maintaining that a prerecorded call, the ultimate purpose of which is to further a commercial enterprise, is a telemarketing call.

We decline to grant ARDA's petition to exempt prerecorded messages regarding timeshare opportunities. The messages ARDA describes that purport to deliver “information only” are clearly part of a marketing campaign to encourage consumers to invest in a commercial product. As we stated in the 2003 TCPA Order, the fact that a sale is not completed during the call or message does not mean the message does not constitute a telephone solicitation or unsolicited advertisement. Messages that describe a new product, a vacation destination, or a company that will be in “your area” to perform home repairs nevertheless are part of an effort to sell goods and services, even if a sale is not made during the call. In addition, as discussed above, messages that promote goods or services at no cost are nevertheless unsolicited advertisements because they describe the “quality of any property, goods or services.” ARDA points out that consumers who receive prerecorded messages must return the calls if they wish to learn more, to complete the sale, or simply to ask to be placed on a do-not-call list. As noted in the 2003 TCPA Order, such messages were determined by Congress to be more intrusive to consumer privacy than live solicitation calls. The record before us shows that consumers are, in fact, often more frustrated by prerecorded messages. The DMA indicates that they should be used only in limited circumstances, as consumers are often offended by such messages. Thus, we reiterate that prerecorded messages that contain either a telephone solicitation or introduce an unsolicited advertisement are prohibited without the prior express consent of the called party.

We disagree with Petitioner Strang that entities sending lawful prerecorded messages must obtain the “prior express consent” of the called party in writing. Unlike the national do-not-call registry, through which consumers have indicated that they do not wish to receive telemarketing calls (by registering on the list), we find no evidence in the record suggesting that consent should be in writing when sending prerecorded messages to consumers not registered on the national do-not-call list. In the case of the national do-not-call registry, we concluded that sellers may contact those consumers on the list if they have obtained the prior express permission of the consumers. Such express permission must be evidenced only by a signed, written agreement between the consumer and the seller. Absent a consumer's listing on the do-not-call registry, such prior express consent to deliver a lawful prerecorded message may be obtained orally. As with the sending of unsolicited facsimile advertisements, telemarketers delivering prerecorded messages must be prepared to provide clear and convincing evidence that they received prior express consent from the called party.

We also decline to reconsider the requirement for businesses to use their legal name to identify themselves when they use prerecorded messages. We believe that the use of “d/b/a” (“doing business as”) alone in many instances may make it difficult to identify the company calling. However, as we stated in the 2003 TCPA Order, the rule does not prohibit the use of “d/b/a” information, provided that the legal name of the business is also provided.

In the 2003 TCPA Order, we addressed prerecorded messages sent by radio stations or television broadcasters that encourage telephone subscribers to tune in at a particular time for a chance to win a prize or similar opportunity. We concluded that if the purpose of the message is merely to invite a consumer to listen to or view a broadcast, such message is permitted under the rules as a commercial call that “does not include or introduce an unsolicited advertisement or constitute a telephone solicitation.” We also noted, however, that if the message encourages consumers to listen to or watch programming that is retransmitted broadcast programming for which consumers must pay (e.g., cable, digital satellite, etc.), such messages would be considered “unsolicited advertisements” for purposes of our rules. Such messages would be part of an overall marketing campaign to encourage the purchase of goods or services or that describe the commercial availability or quality of any goods or services and would be considered “unsolicited advertisements” as defined by the TCPA.

Petitioner Biggerstaff requests that the Commission reconsider its determination that certain radio and television broadcast messages are not considered “unsolicited advertisements” under the restrictions on prerecorded messages. Biggerstaff contends specifically that radio and television broadcasts are entertainment and news “services,” as well as “advertisement delivery services.” Biggerstaff further maintains that there is no basis for treating such broadcasters differently from others providing similar services, such as cable networks, Web sites, newspapers or publishers.

We decline to reverse our conclusion regarding radio station and television broadcaster messages. As explained in the 2003 TCPA Order, if the purpose of the message is merely to invite a consumer to listen to or view a broadcast, such message is permitted under the current rules as “a commercial call that does not include or introduce an unsolicited advertisement or constitute a telephone solicitation.”

In the 2003 TCPA Order, we affirmed that it is unlawful to make any call using an automatic telephone dialing system or an artificial or prerecorded message to any wireless telephone number. We stated that both the statute and our rules prohibit these calls, with limited exceptions, “to any telephone number assigned to a paging service, cellular telephone service, specialized mobile radio service, or other common carrier service, or any service for which the called party is charged.” In addition, we determined not to prohibit all live solicitations to wireless numbers, but noted that the TCPA already prohibits such calls to wireless numbers using an autodialer.

As noted above, section 227(b)(1)(A)(iii) of the TCPA refers to calls made to any telephone number “assigned to” cellular telephone service or any service for which the called party is charged for the call. Verizon Wireless explains that according to numbering guidelines and the Commission's rules, numbers ported to another carrier are treated as “assigned numbers” that are then reported to the Commission for utilization purposes by the donating carrier, not by the receiving carrier. According to Verizon Wireless, a number that is ported to another carrier is still assigned to the original carrier for purposes of numbering and local number portability. Verizon Wireless asks us to clarify that, under the TCPA, the number is “assigned to” a wireless service based on the identity of a customer's new service, rather than the identity of the original carrier.

We agree with those petitioners who point out that permitting autodialed and prerecorded voice messages to wireless telephone numbers that have been ported from wireline carriers would defeat the underlying purpose of the prohibition—to protect wireless subscribers from the cost and interference associated with such calls. To apply the Commission's definition of “assigned numbers” for number utilization purposes to the TCPA's rules on calls to wireless numbers would lead to an unintended result. Telemarketers would be prohibited from placing autodialed and prerecorded message calls to wireless numbers generally, but permitted to place such calls to certain subscribers simply because they have ported their numbers from wireline service to wireless service. In addition, we believe we made clear in the 2003 TCPA Order that, even with the advent of local number portability, we expect telemarketers to make use of the tools available in the marketplace to avoid making autodialed and prerecorded message calls to wireless numbers. Thus, we affirm that a telephone number is assigned to a cellular telephone service, for purposes of the TCPA, if the number is currently being used in connection with that service.

We also agree with the DMA that a call placed to a wireline number that is then forwarded, at the subscriber's sole discretion and request, to a wireless number or service, does not violate the ban on autodialed and prerecorded message calls to wireless numbers. Action on the part of any residential subscriber to forward certain calls from their wireline device to their wireless telephones does not subject telemarketers to liability under the TCPA.

The DMA asks the Commission to further examine and perhaps revise our caller identification (caller ID) requirements, indicating that it is not clear that Automatic Number Identification (ANI) will pass to ordinary residential subscriber lines. Brown petitions the Commission to require telemarketers, when transmitting caller ID, to provide a telephone number, which the consumer may call at no toll charge.

We decline to reconsider the caller ID requirements and dismiss both the DMA's and Brown's petitions. We continue to believe that the caller ID rules allow consumers to screen out unwanted calls and to identify companies that they wish to ask not to call again. In addition, as discussed in the 2003 TCPA Order, we believe that telemarketers can comply with the requirements. Under the rules, telemarketers are required to transmit caller ID information, which must include either ANI or Calling Party Number (CPN). We explained that CPN can include any number associated with the telemarketer or party on whose behalf the call is made, that allows the consumer to identify the caller. This includes a number assigned to the telemarketer by its carrier, the specific number from which a sales representative placed a call, the number for the party on whose behalf the telemarketer is making the call, or the seller's customer service number. Any number supplied must permit an individual to make a do-not-call request during regular business hours for the duration of the telemarketing campaign.

The TCPA provides consumers with a private right of action in State court for any violation of the TCPA's prohibitions on the use of automatic dialing systems, artificial or prerecorded voice messages, and unsolicited facsimile advertisements. Several petitioners request that the Commission clarify the parameters of the private right of action.

The Commission declines to make any determination about the specific contours of the TCPA's private right of action. Congress provided consumers with a private right of action, “if otherwise permitted by the laws or rules of court of a State.” As we stated in the 2003 TCPA Order, this language suggests that Congress contemplated that such legal action was a matter for consumers to pursue in appropriate State courts, subject to those State courts' rules. We continue to believe that it is for Congress, not the Commission, either to clarify or limit this right of action.

We note that no FRFA is necessary for the Second Order on Reconsideration. In this Order, we are not making any changes to the Commission's rules; rather, we are clarifying the existing rules. In addition, there were no objections to the FRFA regarding the Commission's telemarketing rules.

The Commission will send a copy of this Second Order on Reconsideration in a report to be sent to Congress and the General Accounting Office pursuant to the Congressional Review Act, see 5 U.S.C. 801(a)(1)(A).

Pursuant to sections 1-4, 227, and 303(r) of the Communications Act of 1934, as amended, 47 U.S.C. 151-154, 227, and 303(r); and § 1.429 of the Commission's Rules, 47 CFR 1.429, this Second Order on Reconsideration in CG Docket No. 02-278 is adopted as set forth herein, and part 64 of the Commission's rules, 47 CFR 64.1200 is amended as set forth in the Rule Changes.

This Second Order on Reconsideration shall become effective May 13, 2005.

The petitions for reconsideration and/or clarification of the telemarketing rules in CG Docket No. 02-278 are denied in part and granted in part, as set forth herein. As noted above, the Commission intends to address the issue of preemption separately in the future. MedStaffing Inc.’s Petition for Declaratory Ruling is granted to the extent stated herein. Petitions not filed within 30 days of the Report and Order's publication by American Council of Life Insurers, Consumer Bankers Association, Clifford Dowler, and RDI Marketing are dismissed.

This is a synopsis of the Commission's Report and Order, MB Docket 02-266, adopted March 23, 2005, and released March 25, 2005. The full text of this decision is available for inspection and copying during normal business hours in the FCC's Reference Information Center at Portals II, CY-A257, 445 12th 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 20554, telephone 1-800-378-3160 or http://www.BCPIWEB.com. The Commission will send a copy of the Report and Order in this proceeding in a report to be sent to Congress and the Government Accountability Office pursuant to the Congressional Review Act, see 5 U.S.C. 801(a)(1)(A).

The reference coordinates for Channel 294B1 at Dublin, OH are 40-09-20 and 82-54-12. The reference coordinates for Channel 293A at Chillicothe, OH are 39-17-31 and 82-51-38.

This is a synopsis of the Report and Order in MB Docket No. 04-219 adopted March 23, 2005, and released March 25, 2005. The full text of this decision is available for inspection and copying during normal business hours in the FCC Reference Information Center at Portals II, CY-A257, 445 12th Street, SW., Washington, DC. The complete text of this decision may also be purchased from the Commission's copy contractor, Best Copy and Printing, Inc., 445 12th Street, SW., Room CY-B402, Washington, DC 20554, telephone 1-800-378-3160 or http://www.BCPIWEB.com. The Commission will send a copy of this Report and Order in a report to Congress and the Government Accountability Office pursuant to the Congressional Review Act, see 5 U.S.C. 801(a)(1)(A).

NMFS manages the groundfish fishery in the GOA exclusive economic zone according to the Fishery Management Plan for Groundfish of the Gulf of Alaska (FMP) prepared by the North Pacific Fishery Management Council under authority of the Magnuson-Stevens Fishery Conservation and Management Act. Regulations governing fishing by U.S. vessels in accordance with the FMP appear at subpart H of 50 CFR part 600 and 50 CFR part 679.

The second seasonal apportionment of the 2005 Pacific halibut bycatch allowance specified for the deep-water species fishery in the GOA is 300 metric tons as established by the 2005 and 2006 harvest specifications for groundfish of the GOA (70 FR 8958, February 24, 2005), for the period 1200 hrs, A.l.t., April 1, 2005, through 1200 hrs, A.l.t., July 5, 2005.

In accordance with § 679.21(d)(7)(i), the Administrator, Alaska Region, NMFS, has determined that the second seasonal apportionment of the 2005 Pacific halibut bycatch allowance specified for the trawl deep-water species fishery in the GOA has been reached. Consequently, NMFS is prohibiting directed fishing for the deep-water species fishery by vessels using trawl gear in the GOA. The species and species groups that comprise the deep-water species fishery are all rockfish of the genera Sebastes and Sebastolobus, deep-water flatfish, rex sole, arrowtooth flounder, and sablefish.

After the effective date of this closure the maximum retainable amounts at §§ 679.20(e) and (f) apply at any time during a trip.

This action responds to the best available information recently obtained from the fishery. The Assistant Administrator for Fisheries, NOAA (AA), finds good cause to waive the requirement to provide prior notice and opportunity for public comment pursuant to the authority set forth at 5 U.S.C. 553(b)(B) as such requirement is impracticable and contrary to the public interest. This requirement is impracticable and contrary to the public interest as it would prevent NMFS from responding to the most recent fisheries data in a timely fashion and would delay the closure of the deep-water species fishery by vessels using trawl gear in the GOA.

The AA also finds good cause to waive the 30-day delay in the effective date of this action under 5 U.S.C. 553(d)(3). This finding is based upon the reasons provided above for waiver of prior notice and opportunity for public comment.

This action is required by § 679.21 and is exempt from review under Executive Order 12866.

NMFS manages the groundfish fishery in the BSAI according to the Fishery Management Plan for Groundfish of the Bering Sea and Aleutian Islands Management Area (FMP) prepared by the North Pacific Fishery Management Council under authority of the Magnuson-Stevens Fishery Conservation and Management Act. Regulations governing fishing by U.S. vessels in accordance with the FMP appear at subpart H of 50 CFR part 600 and 50 CFR part 679.

The 2005 first seasonal allowance of the Pacific cod TAC specified for catcher/processor vessels using pot gear in the BSAI as a directed fishing allowance is 1,914 metric tons (mt) as established by the 2005 and 2006 final harvest specifications for groundfish in the BSAI (70 FR 8979, February 24, 2005), for the period 1200 hrs, A.l.t., January 1, 2005, through 1200 hrs, A.l.t., June 10, 2005. See §§ 679.20(a)(7)(i)(A), (a)(7)(i)(C)(1)(iii), (c)(3)(iii), and (c)(5)

In accordance with § 679.20(d)(1)(i), the Administrator, Alaska Region, NMFS, has determined that the 2005 first seasonal allowance of the Pacific cod total allowable catch specified for catcher/processor vessels using pot gear in the BSAI will soon be reached. Therefore, the Regional Administrator is establishing a directed fishing allowance of 1,900 mt, and is setting aside the remaining 14 mt as bycatch to support other anticipated groundfish fisheries. In accordance with § 679.20(d)(1)(iii), the Regional Administrator finds that this directed fishing allowance has been reached. Consequently, NMFS is prohibiting directed fishing for Pacific cod by catcher/processor vessels using pot gear in the BSAI.

After the effective date of this closure the maximum retainable amounts at §§ 679.20(e) and (f) apply at any time during a trip.

This action responds to the best available information recently obtained from the fishery. The Assistant Administrator for Fisheries, NOAA (AA), finds good cause to waive the requirement to provide prior notice and opportunity for public comment pursuant to the authority set forth at 5 U.S.C. 553(b)(B) as such requirement is impracticable and contrary to the public interest. This requirement is impracticable and contrary to the public interest as it would prevent NMFS from responding to the most recent fisheries data in a timely fashion and would delay the closure of Pacific cod by catcher/processor vessels using pot gear in the BSAI.

The AA also finds good cause to waive the 30-day delay in the effective date of this action under 5 U.S.C. 553(d)(3). This finding is based upon the reasons provided above for waiver of prior notice and opportunity for public comment.

This action is required by § 679.20 and is exempt from review under Executive Order 12866.