[Federal Register Volume 61, Number 227 (Friday, November 22, 1996)]
[Proposed Rules]
[Pages 59397-59399]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-29875]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Part 1
[MD Docket No. 96-186; FCC 96-422]
Assessment of Annual Regulatory Fees for AM and FM Broadcast
Radio Licensees
AGENCY: Federal Communications Commission.
ACTION: Notice of inquiry.
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SUMMARY: In its decision establishing regulatory fees for fiscal year
1996, the Commission stated that it would initiate a Notice of Inquiry,
in order to develop a more equitable methodology for assessing
regulatory fees upon AM and FM licensees, and in particular, that it
would consider a specific methodology proposed by the Montana
Broadcaster Association. Currently, the Commission assesses regulatory
fees on AM and FM broadcasters based upon a station's license
classification. Montana's proposal bases the fee on both a station's
class of license and market designation. This Notice of Inquiry
requests comments on Montana's proposal and invites interested parties
to suggest alternative methodologies for assessing these fees.
DATES: Interested parties may file comments on or before December 23,
1996 and reply comments on or before January 6, 1997.
ADDRESSES: Federal Communications Commission, 1919 M Street, N.W.,
Washington, D.C. 20554.
FOR FURTHER INFORMATION CONTACT: Jerome D. Remson, Office of General
Counsel at (202) 418-1755, or Terry D. Johnson, Office of Managing
Director at (202) 418-0445.
SUPPLEMENTARY INFORMATION:
Adopted: October 25, 1996.
Released: November 6, 1996.
I. Introduction
1. By this Notice of Inquiry, the Commission is initiating a
proceeding to determine if, in FY 1997, it is feasible to utilize a
methodology based on market size for assessing annual regulatory fees
upon licensees of AM and FM broadcast radio stations. We invite
interested parties to comment upon a methodology proposed by the
Montana Broadcasters Association (Montana), and to propose any other
methodology for assessing AM and FM fees they believe would serve the
public interest.
II. Background
2. In establishing our regulatory fee program, we recognized that
Congress had required the Commission to adopt the Schedule of
Regulatory Fees for FY 1994, contained in section 9(g) of the
Communications Act, as amended. 47 U.S.C. 159(g). The Schedule assessed
AM and FM radio fees based upon class of station. Thus, each licensee
paid a fee identical to other licensees with the same class of station,
without regard to the size of its service area. See Implementation of
Section 9 of the Communications Act, 59 FR 30984 (June 16, 1994), 9 FCC
Rcd 5333, 5339 (1994). Therefore, we declined to consider any revision
to the fee schedule for FY 1994, but we invited interested parties to
propose alternative methodologies for various services subject to the
regulatory fees, including AM and FM radio, for consideration in our
proceeding to adopt the FY 1995 Schedule of Regulatory Fees. 60 FR 3807
(January 19, 1995), 9 FCC Rcd at 5360. Subsequently, in our NOI
proposing fees for FY 1995, we recognized that ``population density of
a (AM or FM) station's geographic location was also a public interest
factor warranting recognition in the fee schedule.'' Therefore, we
proposed for consideration by interested parties a methodology
incorporating market size in the calculation of AM and FM fees, by
assessing higher fees for radio stations located in Arbitron Rating Co.
(Arbitron) designated markets. We proposed a two-tiered fee schedule
with stations in Arbitron rated markets paying higher fees than the
same classes of stations located in smaller, non-Arbitron rated
markets. See Notice of Proposed Rulemaking in the Matter of Assessment
and Collection of Regulatory Fees for Fiscal Year 1995, MD Docket No.
95-3, FCC 95-14, released January 12, 1995 at para. 29. See 60 FR 3807
(January 19, 1995). Nevertheless, in our Report and Order establishing
the FY 1995 fees, we declined to adopt this proposed method because,
after consideration of the comments, we found that it did not provide a
``sufficiently accurate and equitable method for determining fees.''
See Assessment and Collection of Regulatory Fees for Fiscal Year 1995
60 FR 34004 (June 29, 1995), 10 FCC Rcd 13512, 13531-32 (1996).
3. In our Notice of Proposed Rulemaking to establish regulatory
fees for FY 1996, we stated with regard to the fees for AM and FM radio
stations, that we ``were particularly interested in a proposal which
would associate population density and service area contours with
license data'' and we again requested interested parties to propose
viable alternative methodologies for assessment of AM and FM fees.
Assessment and Collection of Regulatory Fees for Fiscal Year 1996, FCC
96-153, Paras. 20-21 (April 9, 1996). See 61 FR 16432 (April 15, 1996).
In response, Montana filed comments proposing an AM and FM fee
structure based on class of station and on market size. We received no
comments addressing Montana's proposal. However, following our own
review of the proposal, we decided not to take any action until we had
an opportunity to more extensively evaluate the impact of
[[Page 59398]]
Montana's proposal on AM and FM licensees through a Notice of Inquiry.
Assessment and Collection of Regulatory Fees for Fiscal Year 1996, FCC
96-295, Paras. 23-29, July 5, 1996, 61 FR 36629 (July 12, 1996).
III. The Montana Proposal
4. Montana's proposed methodology utilizes broad groupings of radio
markets determined by Arbitron market size, with the fee for each
market grouping predicated on the ratios that Congress initially
established in section 9(g) of the Act (47 U.S.C. 159(g)) for assessing
fees for licensees of television stations serving different sized
markets. Montana proposes four specific radio market classifications:
Markets 1 through 25; Markets 26-50; Markets 51-100; and Remaining
Markets. Montana's proposal assigns stations to each market grouping
based upon Arbitron market designations and relies on an analysis of
broadcast markets prepared by Dataworld MediaXpert Service which groups
radio stations by class of station within a particular market size. It
then calculates the fees for stations in different markets utilizing
the ratios between the fees for television markets in section 9(g).
Montana argues that its proposal is more equitable than the groupings
based on class of station relied on by the Commission, because under
its proposal stations in smaller markets would pay lower fees than
stations serving more populous markets.
5. In order to collect the total aggregate fees to be recovered
from AM and FM radio stations as proposed in the FY 1995 NPRM,
Montana's proposed methodology would have allocated fees among radio
stations as follows:
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FM Class I FM Class
Markets AM Class A AM Class B AM Class C AM Class D \1\ II \2\
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1-25.............................. $2,890 $1,710 $645 $815 $2,890 $1,940
26-50............................. 2,040 1,140 455 575 2,040 1,370
51-100............................ 1,360 760 305 385 1,360 910
Remaining......................... 850 475 190 240 850 570
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\1\ Class I includes FM Classes C, C1, C2 and B.
\2\ Class II includes FM Classes A, B1 and C3.
6. However, subsequent to the filing of Montana's proposal,
Congress increased the aggregate amount of fees to be recovered by the
Commission and amended the Commission's regulatory fee schedule for
television stations to increase the fees paid by licensees in larger
markets and to reduce the fees paid by licensees located in Markets 51-
100 and the Remaining Markets. Public Law No. 104-134. See Assessment
Collection of Regulatory Fees for Fiscal Year 1996, supra at para. 14.
This substantially changed the ratios between the fees for television
stations in different sized markets used by Montana to compute its
proposed radio fees. Substituting the actual ratios between the
regulatory fees for television stations in different sized markets for
the old ratios utilized in Montana's proposal, would have produced the
following radio fees for FY 1996: \3\
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\3\ By contrast, according to the FY 1996 Schedule of Regulatory
Fees, AM class A stations are assessed a fee of $1,250; Class B
stations $690; Class C stations $280; and Class D stations $345.
Similarly, FM Class C, C1, C2 and B stations (Montana's FM Class I)
are assessed a fee of $1,250; and FM Class A, B1 and C3 stations
(Montana's FM Class II) a fee of $830.
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FM Class I FM Class
Markets AM Class A AM Class B AM Class C AM Class D \4\ II \5\
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1-25.............................. $11,500 $6,325 $2,575 $3,150 $4,875 $3,250
26-50............................. 6,675 3,675 1,500 1,850 2,850 1,900
51-100............................ 3,550 1,975 800 980 1,525 1,000
Remaining......................... 1,000 555 225 275 430 285
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\4\ Class I includes FM Classes C, C1, C2 and B.
\5\ Class II includes FM Classes A, B1 and C3.
7. The above fees illustrate the impact of the Montana proposal
when the changes mandated by Congress to the Regulatory Fee Schedule
are considered. We are particularly concerned about the size of the
increases in larger markets which, in addition to having more potential
listeners, have greater concentrations of stations, thereby increasing
the competition for listeners in those markets. Moreover, the accuracy
of both sets of calculations are predicated on assumptions that the
total aggregate amount of fees to be collected remains unchanged, that
the revenue requirement allocated to all broadcast licensees remains
unchanged, and that there are no changes in the numbers and classes of
licensees subject to broadcast fees. The calculations presented herein
are illustrative only, because the fees are predicated on assumptions
that may not re-occur in FY 1997. A change in any or all three of these
factors, would result in individual fees different than those
illustrated in paragraph 6.
IV. Conclusion
8. As discussed above, we intend to explore in this proceeding
whether, in FY 1997, the regulatory fee schedule for AM and FM radio
stations should be modified to take into consideration market size. Any
such alternative fee schedule that we might propose would be subject to
public comment in our proceeding to establish fees for FY 1997. To
assist our efforts, we invite public comment on the Montana proposal or
on proposed alternative methods for assessing regulatory fees for the
AM and FM radio services.
V. Procedural Matters
9. Accordingly, the Commission adopts this Notice of Inquiry
pursuant to authority contained in Sections 4 (i) and (j), 9, 303(r),
and 403 of the Communications Act of 1934 as amended. 47 U.S.C. 154 (i)
and (j), 9, 303(r), and 403.
10. Pursuant to the applicable procedures set forth in Secs. 1.415
and 1.4129 of the Commission's rules, 47 CFR 1.425 and 1.419,
interested parties may file comments on or before December 23, 1996 and
reply comments
[[Page 59399]]
on or before January 6, 1997. All relevant and timely comments will be
considered by the Commission before final action is taken in this
proceeding. To file formally in this proceeding, participants must
submit an original and four copies of all comments, reply comments and
supporting comments. If participants want each Commissioner to receive
a personal copy of their comments, an original and nine copies must be
filed. Comments and reply comments should be sent to the Office of the
Secretary, Federal Communications Commission, Washington, DC 20554.
Comments and reply comments will be available for public inspection
during regular business hours in the FCC Reference Center (Room 239,
1919 M Street, NW., Washington, DC 20554), of the Federal
Communications Commission.
11. This Notice of Inquiry is exempt from restrictions on ex parte
presentations. See 47 CFR 1.1204(a)(4).
12. Further information on this proceeding may be obtained by
contacting Jerome D. Remson (202-418-1755), Office of the General
Counsel, or Terry Johnson (202-418-0445, Office of the Managing
Director.
List of Subjects in 47 CFR Part 1
Administrative practice and procedure.
Federal Communications Commission.
William F. Caton,
Acting Secretary.
[FR Doc. 96-29875 Filed 11-21-96; 8:45 am]
BILLING CODE 6712-01-P