[Federal Register Volume 63, Number 166 (Thursday, August 27, 1998)]
[Rules and Regulations]
[Pages 45746-45751]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-22947]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 90

[FCC 98-167]


800 MHz SMR Licensees

AGENCY: Federal Communications Commission.

ACTION: Final rule.

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SUMMARY: In this document, the Federal Communications Commission 
(Commission) addresses several petitions filed since the Commission 
adopted the Goodman/Chan Order, published elsewhere in this issue of 
the Federal Register, on May 22, 1995 and addresses certain issues 
relating to certain General Category Specialized Mobile Radio (SMR) 
Licenses. Dismissing the outstanding pleadings and addressing these 
other issues removes the impediments to implementing the relief the 
Goodman/Chan Order granted. Implementing the relief will allow the 
licensees to construct and/or transfer their licenses and give 
prospective bidders a clear idea on available spectrum in the upcoming 
lower band auction.

DATES: Licensees have four months from August 27, 1998 to complete 
construction of their licenses.

FOR FURTHER INFORMATION CONTACT: Terry Fishel at (717) 338-2602 or 
Ramona Melson or David Judelsohn at (202) 418-7240.

SUPPLEMENTARY INFORMATION:
    1. In this document the Commission addresses several pleadings that 
have been filed since the adoption of the Goodman/Chan Order. The 
Commission dismisses the Brown and Schwaninger petition for 
reconsideration of the Goodman/Chan Order because the Brown and 
Schwaninger Petition was filed after the statutory deadline for 
submission of such petitions. Second, the Commission dismisses a motion 
for clarification filed by Daniel R. Goodman (Goodman) of the Goodman/
Chan Order because it similarly was filed after the statutory deadline 
for such pleadings. Further, the Commission dismisses a petition for 
reconsideration, filed by Goodman, of the November 20 Staff Letter, 
discussing the processing of the General Category SMR licenses that 
received a four-month extension of their construction periods per the 
Goodman/Chan Order. Finally, the Commission addresses certain issues 
relating to certain General Category SMR Licenses. By dismissing the 
outstanding pleadings filed against the Goodman/Chan Order, dismissing 
the Receiver's December 1 Petition for Reconsideration of the November 
20 Staff Letter and addressing these other issues, this Order removes 
the impediments to implementing the relief the Goodman/Chan Order 
granted.
    2. On January 11, 1994, the Federal Trade Commission (FTC) filed a 
Complaint for a permanent injunction and other relief against a number 
of application preparation companies in the United States District 
Court, Southern District of New York (U.S. District Court). Prior to 
the FTC action, the application preparation companies used television 
commercials and telemarketing solicitations to promote SMR licenses as 
``investment opportunities'' for individuals with little or no 
experience in the communications industry. On January 14, 1994, the 
U.S. District Court issued a preliminary injunction freezing the assets 
of the application preparation companies, and appointed Goodman as the 
Receiver (Receiver) for four of these companies (Receivership 
Companies). The U.S. District Court directed the Receiver to use all 
reasonable efforts to ensure that the licenses are either (1) 
constructed and placed in operation in a timely manner, in substantial 
conformance with our regulations, or (2) assigned to an entity which 
will use reasonable efforts to do the same.
    3. On March 15, 1994, and March 21, 1994, respectively, Dr. Robert 
Chan (Chan) and the Receiver filed petitions for waiver of Sec. 90.633 
of our rules to allow certain SMR licensees additional time to 
construct facilities and commence operation. The Goodman Petition was 
brought on behalf of approximately 2500 individuals (Goodman/Chan 
Receivership) who had obtained approximately 4400 conventional licenses 
on 800 MHz General Category channels by using the services of one of 
the Receivership Companies.
    4. In his waiver petition, the Receiver requested an eight-month 
extension of time for the Goodman/Chan Receivership to construct their 
licensed facilities and commence operations, starting from the petition 
grant date. The Receiver also requested a Stay of all automatic 
cancellations of licenses during the pendency of the Goodman Petition. 
On April 29, 1994, the Receiver filed a supplement to his March 21, 
1994 waiver petition, requesting that the PRB refrain from taking any 
action that would result in the cancellation of the General Category 
licenses of the licensees who received their licenses through the 
Receivership Companies during the pendency of the Receiver's waiver 
request. The Receiver also requested that the PRB suspend the mailing 
of automated letter inquiries to the affected licensees concerning the 
construction and loading status of their licenses. In the event that 
the Receiver's petition for waiver was denied, the Receiver requested 
that the PRB provide the licensees a period of 120 days from the date 
of such denial to comply with the provisions of Sec. 90.633 of the 
rules. In the Supplemental Petition, the Receiver also filed his 
initial list of approximately 3,100 entities that had obtained their 
licenses or applications

[[Page 45747]]

through the Receivership Companies (April List).
    5. On May 22, 1995, the Commission adopted the Goodman/Chan Order, 
providing the General Category licensees who received licenses through 
the Receivership Companies an additional four months to construct and 
commence operations of their licenses. The Commission partially granted 
the Goodman/Chan waiver petitions because during the pendency of the 
waiver petitions, it had changed the construction period for all new 
CMRS licenses, including conventional SMR licenses, from eight months 
to twelve months. Thus, the basis for granting the additional four 
months to these licensees was to place them in the same posture as part 
90 CMRS providers licensed after January 2, 1995, when the new rule 
took effect. This four-month period was granted to augment their 
original eight-month construction period to the degree necessary to 
give them the same twelve-month construction period then applicable to 
all part 90 CMRS licensees. However, the Commission also emphasized 
that all other requirements of the rules continued to apply. In 
particular, the Commission stated that the Order did not waive the 
loading requirement, and reiterated that licensees on General Category 
channels would not retain exclusive use of their channels unless they 
satisfied the loading of seventy mobile stations per channel. To the 
extent petitioners had less than seventy such stations operating on 
each of their channels, additional licensees could be licensed to use 
those channels.
    6. The Commission granted both the Receiver's Supplemental Petition 
and the Receiver's May 31 Reinstatement Request. The Commission also 
stated that the four-month-period would commence upon publication of 
the Goodman/Chan Order in the Federal Register. As discussed below, 
publication of the Goodman/Chan Order has not yet occurred.
    7. On June 26, 1995, Brown and Schwaninger filed a petition for 
reconsideration of the Goodman/Chan Order. On July 17, 1995, the 
Receiver filed both an Opposition to the Brown and Schwaninger Petition 
and an Emergency Motion for Clarification or Stay of the Goodman/Chan 
Order. In addition, the Receiver and his counsel, over the course of 
several months following the release of the Goodman/Chan Order, alerted 
our staff to the grant of a number of co-channel and short-spaced 
licenses concerning 342 of the Goodman/Chan licenses. The 342 licenses 
include 208 co-channel licenses, 42 short-spaced licenses, and 92 
cancelled licenses. Through subsequent requests, the Receiver now also 
seeks to address issues concerning 296 other licenses licensees 
voluntarily cancelled. On November 20, 1995, the Wireless 
Telecommunications Bureau's Office of Operations in Gettysburg issued a 
letter which addressed the following issues raised by the Receiver: (1) 
the Commission's granting of co-channel licenses in instances where the 
Goodman/Chan Receivership had not fully loaded their channel; (2) the 
Commission's granting of co-channel licenses between fifty-five and 
seventy miles of a Goodman/Chan Receivership Licensee; (3) voluntary 
cancellations by members of the Goodman/Chan Receivership; and (4) the 
Commission's treatment of cases where frequency coordinators made 
frequency recommendations for other applicants for locations that were 
the same as, or within fifty-five miles of, a Goodman/Chan Receivership 
Licensee.
    8. Simultaneous with the release of the November 20 Staff Letter, 
the Bureau submitted the Goodman/Chan Order for publication in the 
Federal Register. In response, the Receiver's counsel informed the 
Bureau that the Receiver would appeal the Nov. 20 Staff Letter and 
would also seek injunctive relief should the Bureau attempt to publish 
the Goodman/Chan Order in the Federal Register. Even though the 
Commission in the Goodman/Chan Order granted an extension of the 
construction period for approximately 4400 licenses, on November 27, 
1995, the Receiver filed a motion with the United States Court of 
Appeals for the DC Circuit to enjoin Federal Register publication of 
the Goodman/Chan Order to obtain additional time to address licensing 
issues affecting 342 licenses. On December 1, 1995, the Receiver filed 
its December 1 Petition seeking reconsideration of the November 20 
Staff Letter and a request to stay publication of the Goodman/Chan 
Order pending revocation of the overfiled licenses. The court 
subsequently held in abeyance the motion to enjoin Federal Register 
publication to allow the Receiver and the Commission to seek a 
resolution of the issues. On April 30, 1996, the DC Circuit ordered 
that the case continue to be held in abeyance and directed the parties 
to file a status report sixty days from the date of this order and 
every sixty days thereafter. In the most recent status report, we 
indicated that Bureau staff was in the process of drafting the present 
Memorandum Opinion and Order and Order on Reconsideration. The court 
also directed the parties to file motions to govern further proceedings 
within thirty days of the conclusion of the settlement negotiations. 
Since that time, the Receiver has submitted several letters and other 
filings requesting the resolution of various licensing issues affecting 
the status of the licenses.
    9. Because Brown and Schwaninger did not file its petition until 
Monday, June 26, 1995, its petition was late and must be dismissed as 
untimely filed. We find that the Receiver's ``Motion for 
Clarification'' must be treated as a petition for reconsideration of 
the Goodman/Chan Order because it requests that we reconsider our 
decision regarding the formulation of the relief provided in the 
Goodman/Chan Order. As such, because the Receiver asked that something 
in the Goodman/Chan Order be changed, the Receiver's Motion for 
Clarification is subject to section 405 of the Communications Act of 
1934, as amended, and our rules regarding the timely filing of 
petitions for reconsideration, and therefore cannot be considered. 
Because the Receiver did not file his Motion for Clarification until 
July 17, 1995, it is an untimely filed petition under the same 
authority discussed above, thereby precluding its consideration. 
Therefore, we dismiss the Motion for Clarification as untimely filed.
    10. Although we do not grant the Receiver standing, we will use our 
discretion and resolve these issues on our own motion in this 
Memorandum Opinion and Order and Order on Reconsideration. We believe 
it is in the public interest to resolve these issues prior to 
commencement of the 800 MHz SMR Phase II auction scheduled for later 
this year. Consistent with the Balanced Budget Act of 1997, expeditious 
resolution of these matters will provide prospective bidders with 
sufficient information in advance of the auction to prepare business 
plans, assess market conditions, and evaluate the availability of 
equipment for the relevant services. Accordingly, because it is in the 
public interest to resolve all outstanding issues concerning these 
General Category licenses expeditiously, we will address the licensing 
issues raised by the Receiver on our own motion. We will also address 
here the waiver requests of other General Category licensees for an 
extension of time to construct their facilities. Accordingly, we will 
provide general guidance on the following issues: (1) the co-channel 
licensing rules; (2) the short-spacing rules; (3) the license 
cancellation rules; (4) the license renewal rules; (5) the prohibition 
on the transfer of unconstructed licenses; and

[[Page 45748]]

(6) the waiver requests filed by other General Category Licensees.
    11. The Commission granted the Goodman/Chan Receivership licensees 
an opportunity to avoid license cancellation eight months after license 
grant through the extraordinary relief of providing additional time to 
construct and place their facilities in operation. Although it may be 
ambiguous whether the Receiver either requested or received additional 
time for licensees to obtain exclusivity, it is clear that each 
Receivership licensee certified to place seventy mobiles in operation 
within eight months of license grant, but failed to do so. The Receiver 
did not seek a stay of further licensing on each affected channel 
despite the facts that (1) our rules provide that General Category 
channels are not automatically subject to exclusive use, and (2) the 
Receivership licensees lost their ability to prevent further licensing 
on each of their channels when they failed to satisfy their commitment 
to achieve loading of seventy mobile stations on or before eight months 
after license grant. Moreover, there is nothing in our Goodman/Chan 
Order that can be read to prevent additional licensing on the channels 
at issue. While many conventional initial licensees represented that 
they planned to place seventy mobile stations on their channel by the 
end of their eight-month, and now one-year, loading period, our rules 
do not require licensees to load seventy mobiles on their channels and 
not everyone fulfills this requirement for exclusivity. Some licensees 
have more modest assessments of what their loading will be, and, prior 
to the freeze on licensing of General Category channels, we granted co-
channel licenses on channels where the incumbent licensee did not fully 
load. While the Goodman/Chan Receivership claimed to intend to place 
seventy mobiles on each of their channels, as we have noted, ample 
facts in the record demonstrate that members of the Goodman/Chan 
Receivership had no plans to do so, nor were they even aware of the 
requirement for exclusivity.
    12. While the petitions were pending, and prior to the release of 
the Goodman/Chan Order, the Licensing Division, in accordance with its 
standard procedure, sent out automated inquiries to a number of 
Goodman/Chan Receivership Licensees to determine the extent to which 
the licensees had loaded their channels. In 208 instances, Goodman/Chan 
Receivership licensees responded that they had not loaded their 
channels with seventy mobile stations, and, as a result, the Licensing 
Division granted additional licenses to share the channels with these 
licensees, pursuant to Sec. 90.633(b) of our rules. Because none of 
these 208 licenses were fully loaded, our staff did not rescind any co-
channel licenses already authorized on the same channels with these 
Goodman/Chan Receivership licensees. However, in an additional thirty-
eight instances in which Goodman/Chan Receivership licensees responded 
that they had not fully loaded their channels, our staff did not 
process applications for co-channel use and agreed not to grant the 
thirty-eight pending applications for co-channel use. However, in 
accordance with our conclusion that these licensees had no entitlement 
to exclusive use of the channels, we find that the agreement not to 
review and process the thirty-eight pending applications for co-channel 
use was in error because the Goodman/Chan Order did not freeze new 
licensing on these channels. Therefore, the Wireless Telecommunications 
Bureau should have reviewed and processed these applications pursuant 
to the Commission's rules.
    13. Although we granted the Receiver's Supplemental Petition, we 
find no contradiction between the grant of the Supplemental Petition 
and our licensing of co-channel licensees on channels licensed to 
Goodman/Chan licensees. Thus, we affirm the Licensing Division's 
decision to decline to rescind co-channel licenses granted on channels 
occupied by Goodman/Chan Receivership Licensees who reported that they 
had not fully loaded their channels. The Supplemental Petition 
requested that we (1) issue a stay of any cancellation of the affected 
General Category licenses during the pendency of the waiver request; 
(2) suspend the mailing of automated inquiries to the affected General 
Category licensees; (3) grant the affected licensees a 120-day period 
to comply with Sec. 90.633 of our rules if we denied the waiver 
petition; and (4) grant such other relief that is consistent with the 
relief sought in the Supplemental Petition. The actions of our staff 
are consistent with the Goodman/Chan Order because the Commission did 
not grant a freeze of additional licensing on these channels, nor did 
the Goodman/Chan licensees file timely petitions for reconsideration of 
the additional co-channel license grants. Further, the staff did not 
cancel any Goodman/Chan licenses through issuance of co-channel 
licenses to entities who presumably sought to provide service on the 
same channels licensed to members of the Receivership. We also conclude 
that the Division's mailing of automated inquiries was proper and did 
not harm the Goodman/Chan licensees because the information received 
from the responding licensees indicated that, eight months after 
license grant, they had not placed into operation the minimum number of 
seventy mobiles needed to retain exclusivity.
    14. The Receiver contends that some new licensees were granted 
licenses for sites in violation of our mileage separation criteria. We 
disagree. For conventional systems, the Bureau assigned frequencies in 
accordance with our applicable loading criteria. Thus, the staff 
permitted co-channel licensing where the channel was not licensed 
exclusively to one licensee because the licensee failed to load at 
least a minimum of seventy mobile stations on the channel. However, 
when a licensee loaded at least seventy mobile stations on a channel, 
Sec. 90.621(b) of our rules required that the fixed mileage separation 
between co-channel systems be a minimum of 113 kilometers (seventy 
miles). Applicants were permitted to locate co-channel systems closer 
than seventy miles if (1) the channel was not fully loaded, (2) the 
applicant complied with either the consensual short-spacing rule, or 
the technical short-spacing rule, or (3) the applicant received a 
waiver of the mileage separation rule.
    15. The consensual short-spacing rule allowed an applicant to place 
a co-channel system at any distance within the minimum separation 
distance as long as each co-channel licensee within the specified 
separation consented to accept any interference resulting from the 
reduced separation between the systems. The technical short-spacing 
rule allowed co-channel licensing between fifty-five and seventy miles, 
but only if the applicant proposed to operate at reduced power and 
antenna height pursuant to a table set forth in our rules. Applicants 
could also request a waiver of the mileage separation rule by 
submitting an interference analysis that showed the co-channel stations 
would receive the same or greater interference protection than provided 
in the technical short-spacing rule.
    16. In the November 20 Staff Letter, the staff concluded that the 
Receiver failed to provide substantiation on the short-spacing issue at 
the time of its request and there was no evidence that the Licensing 
Division erred in granting these licenses. The Receiver has not 
submitted any additional information that would persuade us otherwise. 
Accordingly, we now decline to cancel or modify any of the short-spaced 
licenses identified by the Receiver.

[[Page 45749]]

    17. The Licensing Division found that it granted 188 short-spaced 
applications for channels licensed to Goodman/Chan licensees, not 318, 
as argued by the Receiver. Furthermore, the staff found that in 146 of 
the 188 short-spaced licensing instances, the Goodman/Chan Receivership 
licensees had, through properly executed short-spacing agreements, 
consented to sharing a channel with other licensees, and thus the 
frequency coordinations were proper. Such ``short-spaced'' frequency 
recommendations are permitted when the requesting applicant submits 
documentation showing consent from the licensee whose station is to be 
affected by the short-spacing. Consequently, the licensing decisions 
with respect to these 146 channels was in full accord with the co-
channel and short-spacing rules.
    18. In the remaining forty-two instances where no short-spacing 
agreement existed, the applicant must comply with the technical short-
spacing rule or receive a waiver of the mileage separation rule if the 
licensee licensed on the channel has loaded the channel with at least 
seventy mobile stations. The staff concluded that although the forty-
two remaining instances were apparently granted in error due to lack of 
short-spacing agreements, the licenses should not be set aside. Our 
staff concluded that the frequency coordinators should work with the 
Goodman/Chan Receivership licensees to reach an equitable solution to 
the mileage separation problem. The staff agreed to closely scrutinize 
the construction and loading performance of the licensees who received 
short-spaced licenses to the Goodman/Chan Receivership Licensees and to 
cancel these licenses, pursuant to our rules, in cases where our 
construction requirements were not timely met. Through the monitoring 
of these forty-two licenses, the staff has determined that fourteen 
have fulfilled their construction requirements. The rest were 
automatically cancelled pursuant to Sec. 90.633(d) of our rules.
    19. The Receiver argues that the Licensing Division's decisions 
with respect to the fourteen licenses where no short-spacing agreements 
existed are in direct contravention to the Goodman/Chan Order. 
Technical short-spacing allows applicants to locate their systems 
closer together than seventy miles upon a technical showing of non-
interference. Although the staff believed that the fourteen licenses 
may have been granted in error because the recommendations of the 
frequency coordinator could not be substantiated by short spacing 
agreements, our review of the records shows that the fourteen Goodman/
Chan licenses were not fully loaded. A conventional SMR licensee 
receives eight months to load a minimum of seventy mobile stations on 
its channel in order to retain exclusivity. However, if the channel 
does not have a minimum of seventy mobile stations on its channel at 
the time the eight month period expires, another licensee may be 
granted on that channel. As a result, even though these fourteen 
licensees did not agree to be short-spaced, our Licensing Division 
correctly granted a license within seventy miles because the channels 
were not exclusive and were not entitled to the standard seventy mile 
separation between co-channel systems. Therefore, we affirm the 
decision of the Licensing Division to allow the fourteen non-Goodman/
Chan Receivership licenses to remain.
    20. The Receiver seeks reinstatement of 106 Goodman/Chan 
Receivership Licenses where the licenses were cancelled based on the 
licensees' failure to respond to automated inquiry letters from the 
staff seeking confirmation that the licensees had constructed their 
facilities and commenced operations. The Receiver argues that these 
licenses were improperly cancelled because the Goodman/Chan Order 
granted the Receiver's request that the Commission not send 
construction inquiries to Goodman/Chan Receivership Licensees after 
March 21, 1994. The staff was not, however, provided with the data 
necessary to identify the Receivership licenses, and thereby modify the 
automated licensing system to prevent sending automated inquiries to 
Receivership licensees. The Goodman/Chan Order expressly provided for 
reinstatement of fourteen licenses under these circumstances. Thus, 
these licenses will be reinstated upon publication of the Goodman/Chan 
Order in the Federal Register.
    21. The Receiver also alerted us to the existence of an additional 
ninety-two cancelled licenses on February 3, 1998. We will reinstate 
all of these licenses granted prior to January 2, 1995. We have 
determined that approximately sixty of the ninety-two licenses were 
granted after January 2, 1995 and therefore received a twelve-month 
construction period. Because the basis for the relief granted in the 
Goodman/Chan Order was to place the Goodman/Chan licensees in the same 
posture as other Part 90 CMRS providers who were given a twelve-month 
construction period, these sixty licenses are not eligible for relief 
and therefore will not be reinstated. We agree to reinstate the 
remaining licenses because they are similarly situated to the original 
fourteen cancelled licenses that the Commission agreed to reinstate in 
the Goodman/Chan Order. We will not, however, cancel any co-channel 
license that has since been granted on a channel that we reinstate with 
this Order for the reasons discussed in para. 41, supra.
    22. The Receiver also identifies 296 licensees who voluntarily 
cancelled their licenses while the Goodman Petition was pending, after 
which they reapplied for and received new licenses at the same 
locations. As a result, these licensees were not among those licensees 
who were granted extensions of the construction deadline by the 
Goodman/Chan Order. The Receiver requests that these licensees receive 
the same extended construction period as other Goodman/Chan Licensees. 
We deny this request. These licensees affirmatively chose to cancel 
their licenses while the Goodman Petition was pending because they 
preferred to obtain new licenses with one-year construction periods, 
rather than continue to press their extension requests. We conclude 
that, as a result of their decision to cancel their licenses, these 
licensees no longer have standing to obtain relief under the Goodman/
Chan Order. We conclude that their rights as licensees are determined 
by their subsequent authorizations. Furthermore, these licensees 
obtained their new licenses after January 2, 1995, and therefore 
received a twelve-month construction period. Because the purpose of the 
additional four-month construction period provided for in the Goodman/
Chan Order was to place the Goodman/Chan Receivership Licensees in the 
same posture as other part 90 CMRS providers, and thereby give them a 
total of twelve months to construct, these 296 licensees do not require 
and are not eligible for such relief. Therefore, we find that these 
licensees will not be granted an additional four months to construct.
    23. The license term of some Goodman/Chan Receivership licenses 
will likely expire prior to the end of the additional four month 
construction period. Pursuant to Sec. 90.149(a), the license term for 
General Category channels is five years. Because our rules do not allow 
for renewal of unconstructed licenses, the Receiver requests that the 
terms of such licenses be extended to enable these licensees to 
complete construction on the same basis as other licensees, so that 
they will then be eligible for renewal.
    24. It is the responsibility of each licensee to apply for renewal 
of its license prior to the expiration date of the license. According 
to the Commission's rules, 800 MHz SMR

[[Page 45750]]

licensees will receive an Application for Renewal of Private Radio 
Station License Form (FCC Form 574-R) in the mail from the Commission. 
If within sixty days before the scheduled expiration of the license, 
the licensee has not received FCC Form 574-R, the licensee should file 
a Private Radio Application for Renewal, Reinstatement and/or 
Notification of Change to License Information Form (FCC Form 405-A) 
before the expiration date of the license to renew the license. Thus, 
failure of a licensee to receive a FCC Form 574-R from the Commission 
is no excuse for failure to file a renewal application. The license 
renewal application should be filed no more than ninety days nor less 
than thirty days prior to the end of the license term in accordance 
with the Commission's rules and the instructions for the appropriate 
form. In accordance with our rules, failure to file a license renewal 
application prior to the license expiration date results in the 
automatic cancellation of the license on its expiration date. However, 
because of the unique circumstances of this case, if the licensee has 
timely filed the appropriate license renewal form, we will toll the 
expiration of the license until the end of the four-month construction 
period. If at the end of that time, the licensee has fully constructed 
its authorization and commenced operations, we will grant the license 
renewal. We will not grant any renewal application if the licensee 
fails to construct or place the station in operation before the 
expiration of the four-month period.
    25. To assist in the potential recovery by members of the Goodman/
Chan Receivership of their monetary losses, the Receiver requests that 
we facilitate efforts by the Goodman/Chan Receivership to assign their 
licenses to other SMR operators prior to the expiration of the 
construction period for such licenses. In the 800 MHz SMR Second Report 
and Order, we temporarily waived the provisions of Sec. 90.609(b) of 
our rules to facilitate the relocation of Incumbent licensees from the 
upper 200 channels to the lower 230 channels as well as to facilitate 
geographic licensing. Thus, we allowed the assignment or transfer of 
unconstructed licenses on the lower 80 and General Category channels 
``to encourage [the] rapid migration of incumbent [licensees], 
preferably through voluntary negotiations, from the upper 200 channels 
to lower band 800 MHz channels.'' In addition, the Commission stated 
that relaxing our transfer restrictions facilitates geographic 
licensing of the lower channels themselves. The Commission also advised 
incumbents to modify their holdings in advance of the auction through 
transfers or channel swaps and new entrants to position themselves for 
the auction by acquiring existing licenses in areas where they intend 
to bid.
    26. Under this waiver, the Bureau accepted transfer applications 
for unconstructed licenses on these channels until six months after the 
conclusion of the 800 MHz upper band auction, i.e., until June 8, 1998. 
We further provided that in the event of a transfer or assignment, the 
transferee would be subject to the same construction deadline as the 
transferor, unless the transferee had extended implementation 
authority. In the latter case, we stated that we would allow licensees 
to apply their system-wide construction deadlines to licenses acquired 
by transfer within their pre-existing footprint.
    27. We determine that the Goodman/Chan Receivership and similarly 
situated non-Goodman Chan General Category SMR licensees who have not 
yet constructed may, during the ninety day period beginning on the day 
the Goodman/Chan Order is published in the Federal Register, apply to 
transfer or assign unconstructed licenses that have received 
construction extensions pursuant to the Goodman/Chan Order and this 
Memorandum Opinion and Order and Order on Reconsideration. We believe 
the same special circumstances that existed in the 800 MHz SMR Second 
Report and Order that facilitated the need to temporarily waive 
Sec. 90.609(b) of our rules exist here; namely, the need to encourage 
rapid migration of incumbents, preferably through voluntary 
negotiations, from the upper 200 channels to lower band 800 MHz 
channels, and facilitate geographic licensing as set out in the 800 MHz 
SMR Second Report and Order. Accordingly, we believe it is in the 
public interest to allow transfers and assignments that will facilitate 
the relocation of incumbent licensees from the upper 200 channels to 
the lower band 800 MHz channels or geographic licensing of the lower 
channels themselves. All such transfer and assignment requests require 
prior Commission approval pursuant to section 310(d) of the 
Communications Act, as amended. All such transfer and assignment 
requests must be made by the individual licensees, as the Receiver does 
not have standing to file such requests. If the transfer or assignment 
is approved, the transferee will be subject to the same construction 
deadline as the transferor, unless the transferee has pre-existing 
extended implementation authority and the license to be transferred is 
within the geographic footprint of the extended implementation system. 
For purposes of this order, we define the ``footprint'' using the 18 
dB interference criteria established for lower band systems in 
the 800 MHz Second Report and Order; i.e., any site will be considered 
in the extended implementation licensee's footprint if it is within the 
18 dB interference contour of an existing site that is part of 
the system for which the transferee has received extended 
implementation authority. In such cases, the transferee may incorporate 
the transferred license into its extended implementation authorization, 
and apply the construction deadline applicable to the system as a 
whole.
    28. We recognize that the ninety day period is much shorter than 
the six month period authorized by the 800 MHz SMR Second Report and 
Order. In providing a shorter period, we weighed the competing 
interests of licensees who desire to bid at auction for the geographic 
licenses in the lower 230 SMR channels against the interests of the 
Goodman/Chan Receivership to receive a fair opportunity to construct 
their channels. Thus, although we will allow the Goodman/Chan 
Receivership ninety days to transfer and assign unconstructed licenses, 
we will not accept FCC Form 175s for the Phase II auction before 
January 15, 1999, which is over five months after release of this 
Order. This delay in accepting FCC Form 175s will permit the four month 
construction period to run as intended. We believe that this 
accommodation for the Goodman/Chan Receivership will allow prospective 
bidders to obtain accurate and complete information concerning the 
lower 230 SMR channels while providing the Goodman/Chan Receivership 
with the full four month period to construct. The Balanced Budget Act 
of 1997 requires that we provide prospective bidders with sufficient 
information in advance of an auction to prepare business plans, assess 
market conditions, and evaluate the availability of equipment for 
relevant services. Therefore, in order to give prospective bidders 
sufficient time to prepare in advance of the auction, the present 
matter needs to be resolved as quickly as possible.
    29. If the Goodman/Chan licensee shares the General Category 
channel, the assignee would acquire the same shared status. To the 
extent that a Goodman/Chan licensee is the sole occupant of a General 
Category channel, that licensee has de facto exclusive use: the General 
Category licensing freeze has been in place now for more than a year, 
precluding any new licensing.

[[Page 45751]]

Moreover, new licensing of General Category channels will not occur for 
several months, when the Commission conducts an auction to award 
geographic area licenses. The transferee of this type of Goodman/Chan 
license thus acquires an expectancy of achieving exclusive channel use. 
The expectancy would be met provided that the assignee or transferee 
incorporates the channel into an aggregately loaded system, or 
demonstrates loading at the constructed site of seventy mobiles.
    30. Although the Goodman/Chan Order does not extend relief to any 
licensee other than the Goodman/Chan Receivership, we conclude that 
similarly situated General Category SMR licensees should receive the 
same four-month construction period extension granted therein. In the 
Goodman/Chan Order, we based our limited grant of relief on the fact 
that during the pendency of the petition, we had replaced our eight-
month construction requirement with a twelve-month construction 
requirement for SMR licensees licensed in the General Category. We 
granted the Goodman/Chan Receivership Licensees a four-month extension 
to their original eight-month construction period to place them in the 
same posture as other SMR licensees who had obtained twelve months to 
construct.
    31. We believe the same relief should be extended to similarly 
situated non-Goodman/Chan General Category SMR licensees. However, in 
order to be granted this limited relief, these licensees must have 
originally been granted an eight-month construction period and must 
have a valid extension request on file with the Commission. Eligible 
licensees will receive the same four-month period to construct that we 
granted to the Goodman/Chan Receivership, which is a period of four 
months to begin upon publication of the Goodman/Chan Order in the 
Federal Register.
    32. In this Memorandum Opinion and Order, we dismiss the Receiver's 
December 1 Petition. We find that the Receiver, Daniel R. Goodman, does 
not have standing to file the December 1 Petition. Individual licensees 
are therefore responsible to address the Bureau with individual 
licensing problems. We also conclude that both the Goodman/Chan 
Receivership and other similarly situated General Category Licensees 
shall have four months to construct and commence operation of their 
licensed facilities from the date that the Goodman/Chan Order is 
published in the Federal Register. We will not cancel any subsequently 
granted licenses on channels occupied by members of the Goodman/Chan 
Receivership who reported that they had not fully loaded their 
channels. We also decline to cancel properly granted co-channel 
licenses.
    33. We direct the Bureau to reinstate the fourteen licenses 
reinstated by the Goodman/Chan Order, as well as thirty-two of the 
additional ninety-two licenses identified by the Receiver on February 
3, 1998. We will allow the Goodman/Chan Receivership and other General 
Category licensees to transfer unconstructed licenses until ninety days 
after the release of this Memorandum Opinion and Order and Order on 
Reconsideration. Lastly, on our own motion, for those licensees whose 
license is scheduled to expire prior to the end of the four-month 
construction period, we will toll the license term to coincide with the 
last day of the four-month construction period, so long as the affected 
licensees previously timely filed a license renewal application. We 
deny the Receiver's February 3 Reinstatement Petition, to the extent 
provided in this Memorandum Opinion and Order and Order on 
Reconsideration. We also dismiss both the Brown and Schwaninger 
Petition and the Receiver's Motion for Clarification as untimely filed. 
In conjunction with the D.C. Circuit action holding in abeyance the 
stay request brought by the Receiver, our Office of General Counsel has 
stated to the Court that the Goodman/Chan Order will not be published 
in the Federal Register until the Court has an opportunity to consider 
the pending Motion for Stay. Accordingly, as a matter of courtesy, we 
instruct the Secretary not to submit this Memorandum Opinion and Order 
and Order on Reconsideration and the Goodman/Chan Order to the Office 
of the Federal Register for publication in the Federal Register until 
twenty days after the release date of this Order. This twenty-day 
deferral of submission will afford the Receiver an opportunity to 
advise the Court of its intention with respect to the stay request and, 
should the Receiver pursue that litigation, the Court will have an 
opportunity to rule.

Federal Communications Commission.
Magalie Roman Salas,
Secretary.
[FR Doc. 98-22947 Filed 8-26-98; 8:45 am]
BILLING CODE 6712-01-P