[Federal Register Volume 64, Number 65 (Tuesday, April 6, 1999)]
[Proposed Rules]
[Pages 16661-16687]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-8342]
=======================================================================
-----------------------------------------------------------------------
FEDERAL COMMUNICATIONS COMMISSION
47 CFR Part 1
[MD Docket No. 98-200; FCC 99-44]
Assessment and Collection of Regulatory Fees for Fiscal Year 1999
AGENCY: Federal Communications Commission.
ACTION: Notice of proposed rulemaking.
-----------------------------------------------------------------------
SUMMARY: The Commission is proposing to revise its Schedule of
Regulatory Fees in order to recover the amount of regulatory fees that
Congress has required it to collect for fiscal year 1999. Section 9 of
the Communications Act of 1934, as amended, provides for the annual
assessment and collection of regulatory fees. For fiscal year 1999
sections 9(b)(2) and (3) provide for annual ``Mandatory Adjustments''
and ``Permitted Amendments'' to the Schedule of Regulatory Fees. These
revisions will further the National Performance Review goals of
reinventing Government by requiring beneficiaries of Commission
services to pay for such services.
DATES: Comments are due on or before April 19, 1999, and reply comments
are due on or before April 29, 1999.
FOR FURTHER INFORMATION CONTACT: Terry Johnson, Office of Managing
Director at (202) 418-0445.
SUPPLEMENTARY INFORMATION:
Table of Contents
Topic
I. Introduction
II. Background
III. Discussion
A. Summary of FY 1999 Fee Methodology
B. Development of FY 1999 Fees
i. Adjustment of Payment Units
ii. Calculation of Revenue Requirements
iii. Recalculation of Fees
iv. Proposed Changes to Fee Schedule
a. FY 1999 Fee Schedule To Be Based on Mandatory Adjustments
b. Reduction of the FM Construction Permit Fee
v. Effect of Revenue Redistributions on Major Constituencies
C. Notice of Inquiry Issues
D. Procedures for Payment of Regulatory Fees
i. Annual Payments of Standard Fees
ii. Installment Payments for Large Fees
iii. Advance Payments of Small Fees
iv. Minimum Fee Payment Liability
v. Standard Fee Calculations and Payments
E. Schedule of FY 1999 Regulatory Fees
IV. Procedural Matters
A. Comment Period and Procedures
B. Ex Parte Rules
C. Initial Regulatory Flexibility Analysis
D. Authority and Further Information
Attachment A--Initial Regulatory Flexibility Analysis
Attachment B--Sources of Payment Unit Estimates For FY 1999
Attachment C--Calculation of Revenue Requirements and Pro-Rata Fees
Attachment D--FY 1999 Schedule of Regulatory Fees
Attachment E--Comparison Between FY 1998 and FY 1999 Proposed
Regulatory Fees
Attachment F--Detailed Guidance on Who Must Pay Regulatory Fees
Attachment G--Description of FCC Activities
Attachment H--Factors, measurements and calculations that go into
determining station signal contours and associated population
coverages
I. Introduction
1. By this Notice of Proposed Rulemaking, the Commission commences
a proceeding to revise its Schedule of Regulatory Fees in order to
collect the amount of regulatory fees that Congress, pursuant to
section 9(a) of the Communications Act, as amended, has required it to
collect for Fiscal Year (FY) 1999.1
---------------------------------------------------------------------------
\1\ 47 U.S.C. 159 (a).
---------------------------------------------------------------------------
2. Congress has required that we collect $172,523,000 through
regulatory fees in order to recover the costs of our enforcement,
policy and rulemaking, international and user information activities
for FY 1999.2 This amount is $10,000,000 or approximately 6%
more than the amount that Congress designated for recovery through
regulatory fees for FY 1998.3 Thus, we are proposing to
revise our fees in order to collect the increased amount that Congress
has required that we collect. Additionally, we propose to amend the
Schedule in order to simplify and streamline it.4
---------------------------------------------------------------------------
\2\ Public Law 105-277 and 47 U.S.C. 159(a)(2).
\3\ Assessment and Collection of Regulatory Fees for Fiscal Year
1998, FCC 98-115, released June 16, 1998, 63 FR 35847 (Jul. 1,
1998).
\4\ 47 U.S.C. 159(b)(3).
---------------------------------------------------------------------------
3. In proposing to revise our fees, we adjusted the payment units
and revenue requirement for each service subject to a fee, consistent
with sections 159(b)(2) and (3). In addition, we are proposing changes
to the fees pursuant to public interest considerations. The current
Schedule of Regulatory Fees is set forth in sections 1.1152 through
1.1156 of the Commission's rules.5
---------------------------------------------------------------------------
\5\ 47 CFR 1.1152 through 1.1156.
---------------------------------------------------------------------------
[[Page 16662]]
II. Background
4. Section 9(a) of the Communications Act of 1934, as amended,
authorizes the Commission to assess and collect annual regulatory fees
to recover the costs, as determined annually by Congress, that it
incurs in carrying out enforcement, policy and rulemaking,
international, and user information activities.6 See
Attachment G for a description of these activities. In our FY 1994 Fee
Order,7 we adopted the Schedule of Regulatory Fees that
Congress established, and we prescribed rules to govern payment of the
fees, as required by Congress.8 Subsequently, we modified
the fee Schedule to increase the fees in accordance with the amounts
Congress required us to collect in each succeeding fiscal year. We also
amended the rules governing our regulatory fee program based upon our
experience administering the program in prior years.9
---------------------------------------------------------------------------
\6\ 47 U.S.C. 159(a).
\7\ 59 FR 30984 (Jun. 16, 1994).
\8\ 47 U.S.C. 159(b), (f)(1).
\9\ 47 CFR 1.1151 et seq.
---------------------------------------------------------------------------
5. As noted, for FY 1994 we adopted the Schedule of Regulatory Fees
established in section 9(g) of the Act. For fiscal years after FY 1994,
however, sections 9(b)(2) and (3), respectively, provide for
``Mandatory Adjustments'' and ``Permitted Amendments'' to the Schedule
of Regulatory Fees.10 Section 9(b)(2), entitled ``Mandatory
Adjustments,'' requires that we revise the Schedule of Regulatory Fees
whenever Congress changes the amount that we are to recover through
regulatory fees.11
---------------------------------------------------------------------------
\10\ 47 U.S.C. 159(b)(2), (b)(3).
\11\ 47 U.S.C. 159(b)(2).
---------------------------------------------------------------------------
6. Section 9(b)(3), entitled ``Permitted Amendments,'' requires
that we determine annually whether additional adjustments to the fees
are warranted, taking into account factors that are reasonably related
to the payer of the fee and factors that are in the public interest. In
making these amendments, we are to ``add, delete, or reclassify
services in the Schedule to reflect additions, deletions or changes in
the nature of its services.'' 12
---------------------------------------------------------------------------
\12\ 47 U.S.C. 159(b)(3).
---------------------------------------------------------------------------
7. Section 9(i) requires that we develop accounting systems
necessary to adjust our fees pursuant to changes in the costs of
regulation of various services that are subject to a fee, and for other
purposes.13 For FY 1997, we relied for the first time on
cost accounting data to identify our regulatory costs and to develop
our FY 1997 fees based upon these costs. Also, for FY 1997, we limited
the increase in the amount of the fee for any service in order to phase
in our reliance on cost-based fees for those services whose revenue
requirement would be more than 25 percent above the revenue requirement
which would have resulted from the ``mandatory adjustments'' to the FY
1997 fees without incorporation of costs. This methodology, which we
continued to utilize for FY 1998, enabled us to develop regulatory fees
which we believed to be more reflective of our costs of regulation, and
allowed us to make revisions to our fees based on the fullest extent
possible, and consistent with the public interest, on the actual costs
of regulating those services subject to a fee. Finally, section
9(b)(4)(B) requires that we notify Congress of any permitted amendments
90 days before those amendments go into effect.14
---------------------------------------------------------------------------
\13\ 47 U.S.C. 159(i).
\14\ 47 U.S.C. 159(b)(4)(B).
---------------------------------------------------------------------------
III. Discussion
A. Summary of FY 1999 Fee Methodology
8. As noted, Congress has required that the Commission recover
$172,523,000 for FY 1999 through the collection of regulatory fees,
representing the costs applicable to our enforcement, policy and
rulemaking, international, and user information
activities.15
---------------------------------------------------------------------------
\15\ 47 U.S.C. 159(a).
---------------------------------------------------------------------------
9. In developing our proposed FY 1999 fee schedule, we first
determined that we would continue to use the same general methodology
for ``Mandatory Adjustments'' to the Fee Schedule as we used in
developing fees for FY 1998. We estimated the number of payment units
16 for FY 1999 in order to determine the aggregate amount of
revenue we would collect without any revision to our FY 1998 fees.
Next, we compared this revenue amount to the $172,523,000 that Congress
has required us to collect in FY 1999 and pro-rated the difference
among all the existing fee categories.
---------------------------------------------------------------------------
\16\ Payment units are the number of subscribers, mobile units,
pagers, cellular telephones, licenses, call signs, adjusted gross
revenue dollars, etc. which represent the base volumes against which
fee amounts are calculated.
---------------------------------------------------------------------------
10. Once we established our tentative FY 1999 fees, we evaluated
proposals made by Commission staff concerning ``Permitted Amendments''
to the Fee Schedule and to our collection procedures. These proposals
are discussed in paragraphs 15-19 and are factored into our proposed FY
1999 Schedule of Regulatory Fees, set forth in Attachment D.
11. Finally, we have incorporated, as Attachment F, proposed
Guidance containing detailed descriptions of each fee category,
information on the individual or entity responsible for paying a
particular fee and other critical information designed to assist
potential fee payers in determining the extent of their fee liability,
if any, for FY 1999.17 In the following paragraphs, we
describe in greater detail our proposed methodology for establishing
our FY 1999 regulatory fees.
---------------------------------------------------------------------------
\17\ We also will incorporate a similar Attachment in the Report
and Order concluding this rulemaking. That Attachment will contain
updated information concerning any changes made to the proposed fees
adopted by the Report and Order.
---------------------------------------------------------------------------
B. Development of FY 1999 Fees
i. Adjustment of Payment Units
12. In calculating individual service regulatory fees for FY 1999,
we adjusted the estimated payment units for each service because
payment units for many services have changed substantially since we
adopted our FY 1998 fees. We obtained our estimated payment units
through a variety of means, including our licensee data bases, actual
prior year payment records, and industry and trade group projections.
Whenever possible, we verified these estimates from multiple sources to
ensure the accuracy of these estimates. Attachment B provides a summary
of how revised payment units were determined for each fee
category.18
---------------------------------------------------------------------------
\18\ It is important to also note that Congress' required
revenue increase in regulatory fee payments of approximately six
percent in FY 1999 will not fall equally on all payers because
payment units have changed in several services. When the number of
payment units in a service increase from one year to another, fees
do not have to rise as much as they would if payment units had
decreased or remained stable. Declining payment units have the
opposite effect on fees.
---------------------------------------------------------------------------
ii. Calculation of Revenue requirements
13. We next multiplied the revised payment units for each service
by the FY 1998 fees in each category to determine how much revenue we
would collect without any change to the FY 1998 Schedule of Regulatory
Fees. The amount of revenue which we would collect without changes to
the Fee Schedule is approximately $157.6 million. This amount is
approximately $14.9 million less than the amount the Commission is
required to collect in FY 1999. We then adjusted the revenue
requirements for each category on a proportional basis, consistent with
Section 9(b)(2) of the Act, to obtain an estimate of the revenue
requirements for each fee category so that the Commission could collect
$172,523,000 as required by Congress. Attachment C
[[Page 16663]]
provides detailed calculations showing how we determined the revised
revenue amounts to be raised for each service.
iii. Recalculation of Fees
14. Once we determined the amount of fee revenue that it is
necessary to collect from each class of licensee, we divided the
revenue requirement by the number of payment units (and by the license
term, if applicable, for ``small'' fees) to obtain actual fee amounts
for each fee category. These calculated fee amounts were then rounded
in accordance with section 9(b)(3) of the Act. See Attachment C.
iv. Proposed Changes to Fee Schedule
15. We examined the results of our calculations to determine if
further adjustments of the fees and/or changes to payment procedures
were warranted based upon the public interest and other criteria
established in 47 U.S.C. 159(b)(3). 19 As a result of this
review, we are proposing the following ``Permitted Amendments'' to our
Fee Schedule:
---------------------------------------------------------------------------
\19\ In FY 1997 and FY 1998 we limited increases to 25%. For FY
1999, none of the proposed fee increases exceed 25%.
---------------------------------------------------------------------------
a. FY 1999 Fee Schedule To Be Based on Mandatory Adjustments
16. We are proposing that the FY 1999 fee schedule be based on the
mandatory adjustments as computed in Attachment C and in accordance
with section 9(b)(2) of the Act.
b. Reduction of the FM Construction Permit Fee
17. In the original Congressional fee schedule, the FM Construction
Permit fee was set at $500 (Five times the AM Construction Permit Fee
of $100). In succeeding year's schedules, nearly the same relationship
has prevailed as evidenced by the calculated FM Construction Permit fee
for FY 1999 of $1,250 (compared to the calculated AM Construction
Permit fee for FY 1999 of $255).
18. Several parties have informally expressed concern that the FM
Construction Permit fee is out of proportion in relation to the fees
imposed on licensed FM stations particularly in less populated areas.
At the same time, it should be noted that the regulatory costs borne by
the Commission applicable to FM Construction Permits is significantly
higher than its costs for AM Construction Permits.
19. We seek comment on a staff proposal to make a permitted
amendment to the schedule of regulatory fees for FY 1999 reducing the
FM Construction Permit fee to $765 (three times the AM Construction
Permit fee). This reduction would result in a loss of $145,500 in
estimated regulatory fee collections.
v. Effect of Revenue Redistributions on Major Constituencies
20. The following chart illustrates the relative percentage of the
overall revenue requirements borne by the major constituencies since
the inception of regulatory fees in FY 1994.
Percentage of Revenue Collected by Constituency
--------------------------------------------------------------------------------------------------------------------------------------------------------
FY 1994 FY 1995 FY 1996 FY 1997 FY 1998 FY 1999
(actual) (actual) (actual) (actual) (actual) (proposed)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Cable TV Operators (Inc. CARS Licenses)................. 41.4 24.0 33.4 21.8 17.9 17.9
Broadcast Licensees..................................... 23.8 13.8 14.6 14.1 15.6 15.4
Satellite Operators (Inc. Earth Stations)............... 3.3 3.6 4.0 5.0 5.3 5.6
Common Carriers......................................... 25.0 44.5 40.9 49.8 47.5 47.1
Wireless Licensees...................................... 6.5 14.1 7.1 9.3 13.7 14.0
-----------------------------------------------------------------------------------------------
Total............................................... 100.0 100.0 100.0 100.0 100.0 100.0
--------------------------------------------------------------------------------------------------------------------------------------------------------
C. Notice of Inquiry Issues
21. On November 10, 1998, the Commission adopted a Notice of
Inquiry in this proceeding seeking comments on five specific
issues.20 Briefly, the issues for which comments were sought
included: (1) Clarification of the Commercial Mobile Radio Services
(``CMRS'') fee categories and demarcation of which types of services or
usage to include in each category; 21 (2) determination of
the appropriate basis for assessing regulatory fees on geostationary
orbit space stations (``GSOs''); (3) determination of the appropriate
method of assessing our regulatory costs associated with non-
geostationary orbit space station systems (``NGSOs'') to licensees
which have launched satellites or to all NGSO licensees; (4) whether we
should base revenues for interstate telephone service providers on the
Universal Services Fund's end user methodology rather than the
Telecommunication Relay Services Fund adjusted gross revenue
methodology; and (5) whether we should create a ``new services''
category in our cost accounting system in which costs associated with
development of new services, regardless of the service, would be
proportionately assessed to all feeable categories rather than assessed
to existing licensees in the same service category.
---------------------------------------------------------------------------
\20\ 63 FR 70090 (Dec. 18, 1998).
\21\ In this regard we specifically request additional comments
on a proposal raised by BellSouth Wireless in its Petitions for
Reconsideration of the FY 1997 and FY 1998 Rulemakings, that the
Commission reclassify 900 MHz SMR Service into the CMRS Message
Service.
---------------------------------------------------------------------------
22. In the interest of expediting this NPRM, we are deferring
analysis of the comments and replies received pursuant to the NOI for
inclusion in the final Report and Order in this proceeding. Commenters
do not need to resubmit these same arguments in response to this NPRM.
Further, the basis for assessing revenues for interstate telephone
service providers is best delayed until the conclusion of CC Docket No.
98-171, In the Matter of 1998 biennial Regulatory Review--Streamlined
Contributor Reporting Requirements Associated with Administration of
Telecommunications Relay Services, North American Numbering Plan, Local
Number Portability, and Universal Service support
Mechanisms.22
---------------------------------------------------------------------------
\22\ FCC 98-233, released September 25, 1998, 63 FR 54090 (Oct.
8, 1998).
---------------------------------------------------------------------------
D. Procedures for Payment of Regulatory Fees
23. Generally, we propose to retain the procedures that we have
established for the payment of regulatory fees. Section 9(f) requires
that we permit ``payment by installments in the case of fees in large
amounts, and in the case of small amounts, shall require the payment of
the fee in advance for a
[[Page 16664]]
number of years not to exceed the term of the license held by the
payer.'' See 47 U.S.C. 159(f)(1). Consistent with section 9(f), we are
again proposing to establish three categories of fee payments, based
upon the category of service for which the fee payment is due and the
amount of the fee to be paid. The fee categories are (1) ``standard''
fees, (2) ``large'' fees, and (3) ``small'' fees.
i. Annual Payments of Standard Fees
24. As we have in the past, we are proposing to treat regulatory
fee payments by certain licensees as ``standard fees'' which are those
regulatory fees that are payable in full on an annual basis. Payers of
standard fees are not required to make advance payments for their full
license term and are not eligible for installment payments. All
standard fees are payable in full on the date we establish for payment
of fees in their regulatory fee category. The payment dates for each
regulatory fee category will be announced either in the Report and
Order terminating this proceeding or by public notice in the Federal
Register pursuant to authority delegated to the Managing Director.
ii. Installment Payments for Large Fees
25. While we are mindful that time constraints may preclude an
opportunity for installment payments, we propose that regulatees in any
category of service with a liability of $12,000 or more be eligible to
make installment payments and that eligibility for installment payments
be based upon the amount of either a single regulatory fee payment or
combination of fee payments by the same licensee or regulatee. We
propose that regulatees eligible to make installment payments may
submit their required fees in two equal payments (on dates to be
announced) or, in the alternative, in a single payment on the date that
their final installment payment is due. Due to statutory constraints
concerning notification to Congress prior to actual collection of the
fees, however, it is unlikely that there will be sufficient time for
installment payments, and that regulatees eligible to make installment
payments will be required to pay these fees on the last date that fee
payments may be submitted. The dates for installment payments, or a
single payment, will be announced either in the Report and Order
terminating this proceeding or by public notice published in the
Federal Register pursuant to authority delegated to the Managing
Director.
iii. Advance Payments of Small Fees
26. As we have in the past, we are proposing to treat regulatory
fee payments by certain licensees as ``small'' fees subject to advance
payment consistent with the requirements of section 9(f)(2). We propose
that advance payments will be required from licensees of those services
that we decided would be subject to advance payments in our FY 1994
Report and Order, and to those additional payers set forth
herein.23 We are also proposing that payers of advance fees
will submit the entire fee due for the full term of their licenses when
filing their initial, renewal, or reinstatement application. Regulatees
subject to a payment of small fees shall pay the amount due for the
current fiscal year multiplied by the number of years in the term of
their requested license. In the event that the required fee is adjusted
following their payment of the fee, the payer would not be subject to
the payment of a new fee until filing an application for renewal or
reinstatement of the license. Thus, payment for the full license term
would be made based upon the regulatory fee applicable at the time the
application is filed. The effective date for payment of small fees
established in this proceeding will be announced in our Report and
Order terminating this proceeding or by public notice published in the
Federal Register pursuant to authority delegated to the Managing
Director.
---------------------------------------------------------------------------
\23\ Applicants for new, renewal and reinstatement licenses in
the following services will be required to pay their regulatory fees
in advance: Land Mobile Services, Microwave Services, Marine (Ship)
Service, Marine (Coast) Service, Private Land Mobile (Other)
Services, Aviation (Aircraft) Service, Aviation (Ground) Service,
General Mobile Radio Service (GMRS).
---------------------------------------------------------------------------
iv. Minimum Fee Payment Liability
27. As we have in the past, we are proposing that regulatees whose
total regulatory fee liability, including all categories of fees for
which payment is due by an entity, amounts to less than $10 will be
exempted from fee payment in FY 1999.
v. Standard Fee Calculations and Payment Dates
28. As noted, the time for payment of standard fees and any
installment payments will be announced in our Report and Order
terminating this proceeding or will be published in the Federal
Register pursuant to authority delegated to the Managing Director. For
licensees, permittees and holders of other authorizations in the Common
Carrier, Mass Media, and Cable Services whose fees are not based on a
subscriber, unit, or circuit count, we are proposing that fees be paid
for any authorization issued on or before October 1, 1998.24
---------------------------------------------------------------------------
\24\ Where a license or authorization is transferred or assigned
after October 1, 1998, the fee shall be paid by the licensee or
holder of the authorization on the date that the payment is due.
---------------------------------------------------------------------------
29. In the case of regulatees whose fees are based upon a
subscriber, unit or circuit count, the number of a regulatees'
subscribers, units or circuits on December 31, 1998, will be used to
calculate the fee payment.25
---------------------------------------------------------------------------
\25\ Cable system operators are to compute their subscribers as
follows: Number of single family dwellings + number of individual
households in multiple dwelling unit (apartments, condominiums,
mobile home parks, etc.) paying at the basic subscriber rate + bulk
rate customers + courtesy and free service. Note: Bulk-Rate
Customers = Total annual bulk-rate charge divided by basic annual
subscription rate for individual households. Cable system operators
may base their count on ``a typical day in the last full week'' of
December 1998, rather than on a count as of December 31, 1998.
---------------------------------------------------------------------------
E. Schedule of Regulatory Fees
30. The Commission's proposed Schedule of Regulatory Fees for FY
1999 is contained in Attachment D of this NPRM.
IV. Procedural Matters
A. Comment Period and Procedures
31. Pursuant to sections 1.415 and 1.419 of the Commission's rules,
47 CFR 1.415, 1.419, interested parties may file comments on or before
April 19, 1999, and reply comments on or before April 29, 1999.
Comments may be filed using the Commission's Electronic Comment Filing
System (ECFS) or by filing paper copies.26
---------------------------------------------------------------------------
\26\ Electronic Filing of Documents in Rulemaking Proceedings,
63 FR 24121 (1998).
---------------------------------------------------------------------------
32. Comments filed through the ECFS can be sent as an electronic
file via the Internet to <http://www.fcc.gov/e-file/ecfs.html>.
Generally, only one copy of an electronic submission must be filed.
However, if multiple docket or rulemaking numbers appear in the caption
of this proceeding, commenters must transmit one electronic copy of the
comments to each docket or rulemaking number referenced in the caption.
In completing the transmittal screen, commenters should include their
full name, Postal Service mailing address, and the applicable docket or
rulemaking number. Parties may also submit an electronic comment by e-
mail via Internet. To get filing instructions for e-mail comments,
commenters should send an e-mail to [email protected], and should include
the following words in the body of the message, ``get form 27
---------------------------------------------------------------------------
\27\ 47 CFR 1.1202, 1.1203 and 1026(a).
---------------------------------------------------------------------------
C. Initial Regulatory Flexibility Analysis
37. As required by the Regulatory Flexibility Act,28 the
Commission has prepared an Initial Regulatory Flexibility Analysis
(IRFA) of the possible impact on small entities of the proposals
suggested in this document. The IRFA is set forth as Attachment A.
Written public comments are requested with respect to the IRFA. These
comments must be filed in accordance with the same filing deadlines for
comments on the rest of the NPRM, but they must have a separate and
distinct heading, designating the comments as responses to the IRFA.
The Office of Public Affairs, Reference Operations Division, shall send
a copy of this NPRM, including the IRFA, to the Chief Counsel for
Advocacy of the Small Business Administration, in accordance with the
Regulatory Flexibility Act.
---------------------------------------------------------------------------
\28\ 5 U.S.C. 603.
---------------------------------------------------------------------------
D. Authority and Further Information
38. Authority for this proceeding is contained in sections 4(i) and
(j), 9, and 303(r) of the Communications Act of 1934, as
amended.29 It is ordered that this NPRM is adopted. It is
further ordered that the Commission's Office of Public Affairs,
Reference Operations Division, shall send a copy of this NPRM,
including the Initial Regulatory Flexibility Analysis, to the Chief
Counsel for Advocacy of the Small Business Administration.
---------------------------------------------------------------------------
\29\ 47 U.S.C. 154(i)-(j), 159, & 303(r).
---------------------------------------------------------------------------
39. Further information about this proceeding may be obtained by
contacting the Fees Hotline at (202) 418-0192.
Federal Communications Commission.
Magalie Roman Salas,
Secretary.
Attachment A--Initial Regulatory Flexibility Analysis
1. As required by the Regulatory Flexibility Act
(RFA),30 the Commission has prepared this Initial Regulatory
Flexibility Analysis (IRFA) of the possible significant economic impact
on small entities by the policies and rules proposed in the present
Notice of Proposed Rulemaking, In the Matter of Assessment and
Collection of Regulatory Fees for Fiscal Year 1999. Written public
comments are requested on this IRFA. Comments must be identified as
responses to the IRFA and must be filed by the deadlines for comments
on the IRFA provided above in paragraph 31. The Commission will send a
copy of the NPRM, including this IRFA, to the Chief Counsel for
Advocacy of the Small Business Administration.31 In
addition, the NPRM and IRFA (or summaries thereof) will be published in
the Federal Register.32
---------------------------------------------------------------------------
\30\ 5 U.S.C. 603. The RFA, 5 U.S.C. 601 et seq., has been
amended by the Contract With America Advancement Act of 1996, Public
Law No. 104-121, 110 Stat. 847 (1996) (CWAAA). Title II of the CWAAA
is the Small Business Regulatory Enforcement Fairness Act of 1996
(SBREFA).
\31\ 5 U.S.C. 603(a).
\32\ Id.
---------------------------------------------------------------------------
I. Need for, and Objectives of, the Proposed Rules
2. This rulemaking proceeding is initiated to obtain comments
concerning the Commission's proposed amendment of its Schedule of
Regulatory Fees. For Fiscal Year 1999, we intend to collect regulatory
fees in the amount of $172,523,000, the amount that Congress has
required the Commission to recover. The Commission seeks to collect the
necessary amount through its proposed revised fees, as contained in the
attached Schedule of Regulatory Fees, in the most efficient manner
possible and without undue burden to the public.
II. Legal Basis
3. This action, including publication of proposed rules, is
authorized under Sections (4)(i) and (j), 9, and 303(r) of the
Communications Act of 1934, as amended.33
---------------------------------------------------------------------------
\33\ 47 U.S.C. 154(i) and (j), 159, and 303(r).
---------------------------------------------------------------------------
III. Description and Estimate of the Number of Small Entities to
Which the Proposed Rules Will Apply
4. 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 proposed rules, if adopted.34 The RFA
generally defines the term ``small entity'' as having the same meaning
as the terms ``small business,'' ``small organization,'' and ``small
governmental jurisdiction.'' 35 In addition, the term
``small business'' has the same meaning as the term ``small business
concern'' under the Small Business Act.36 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).37 A small organization is generally ``any not-for-
profit enterprise which is independently owned and operated and is not
dominant in its field.'' 38 Nationwide, as of 1992, there
were approximately
[[Page 16666]]
275,801 small organizations.39 ``Small governmental
jurisdiction'' generally means ``governments of cities, counties,
towns, townships, villages, school districts, or special districts,
with a population of less than 50,000.'' 40 As of 1992,
there were approximately 85,006 such jurisdictions in the United
States.41 This number includes 38,978 counties, cities, and
towns; of these, 37,566, or 96 percent, have populations of fewer than
50,000.42 The Census Bureau estimates that this ratio is
approximately accurate for all governmental entities. Thus, of the
85,006 governmental entities, we estimate that 81,600 (91 percent) are
small entities. We further describe and estimate the number of small
entity licensees and regulatees that may be affected by the proposed
rules, if adopted.
---------------------------------------------------------------------------
\34\ 5 U.S.C. 603(b)(3).
\35\ Id. 601(6).
\36\ 5 U.S.C. 601(3) (incorporating by reference the definition
of ``small business concern'' in 15 U.S.C. 632). Pursuant to the
RFA, 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.'' 5 U.S.C. 601(3).
\37\ Small Business Act, 15 U.S.C. 632 (1996).
\38\ 5 U.S.C. 601(4).
\39\ 1992 Economic Census, U.S. Bureau of the Census, Table 6
(special tabulation of data under contract to Office of Advocacy of
the U.S. Small Business Administration).
\40\ 5 U.S.C. 601(5).
\41\ U.S. Dept. of Commerce, Bureau of the Census, ``1992 Census
of Governments.''
\42\ Id.
---------------------------------------------------------------------------
Cable Services or Systems
5. The SBA has developed a definition of small entities for cable
and other pay television services, which includes all such companies
generating $11 million or less in revenue annually.43 This
definition includes cable systems operators, closed circuit television
services, direct broadcast satellite services, multipoint distribution
systems, satellite master antenna systems and subscription television
services. According to the Census Bureau data from 1992, there were
1,788 total cable and other pay television services and 1,423 had less
than $11 million in revenue.44
---------------------------------------------------------------------------
\43\ 13 CFR 121.201, SIC code 4841.
\44\ 1992 Economic Census Industry and Enterprise Receipts Size
Report, Table 2D, SIC code 4841 (U.S. Bureau of the Census data
under contract to the Office of Advocacy of the U.S. Small Business
Administration).
---------------------------------------------------------------------------
6. The Commission has developed its own definition of a small cable
system operator for the purposes of rate regulation. Under the
Commission's rules, a ``small cable company'' is one serving fewer than
400,000 subscribers nationwide.45 Based on our most recent
information, we estimate that there were 1,439 cable operators that
qualified as small cable system operators at the end of
1995.46 Since then, some of those companies may have grown
to serve over 400,000 subscribers, and others may have been involved in
transactions that caused them to be combined with other cable
operators. Consequently, we estimate that there are fewer than 1,439
small entity cable system operators.
---------------------------------------------------------------------------
\45\ 47 CFR 76.901(e). The Commission developed this definition
based on its determination that a small cable system operator is one
with annual revenues of $100 million or less. Implementation of
Sections of the 1992 Cable Act: Rate Regulation, Sixth Report and
Order and Eleventh Order on Reconsideration, 10 FCC Rcd 7393 (1995),
60 FR 10534 (Feb. 27, 1995).
\46\ Paul Kagan Associates, Inc., Cable TV Investor, Feb. 29,
1996 (based on figures for Dec. 30, 1995).
---------------------------------------------------------------------------
7. The Communications Act also contains a definition of a small
cable system operator, which is ``a cable operator that, directly or
through an affiliate, serves in the aggregate fewer than 1 percent of
all subscribers in the United States and is not affiliated with any
entity or entities whose gross annual revenues in the aggregate exceed
$250,000,000.'' 47 The Commission has determined that there
are 66,000,000 subscribers in the United States. Therefore, we found
that an operator serving fewer than 660,000 subscribers shall be deemed
a small operator, if its annual revenues, when combined with the total
annual revenues of all of its affiliates, do not exceed $250 million in
the aggregate.48 Based on available data, we find that the
number of cable operators serving 660,000 subscribers or less totals
1,450.49 We do not request nor do we collect information
concerning whether cable system operators are affiliated with entities
whose gross annual revenues exceed $250,000,000,50 and thus
are unable at this time to estimate with greater precision the number
of cable system operators that would qualify as small cable operators
under the definition in the Communications Act. It should be further
noted that recent industry estimates project that there will be a total
64,000,000 subscribers, and we have based our fee revenue estimates on
that figure.
---------------------------------------------------------------------------
\47\ 47 U.S.C. 543(m)(2).
\48\ Id. 76.1403(b).
\49\ Paul Kagan Associates, Inc., Cable TV Investor, Feb. 29,
1996 (based on figures for Dec. 30, 1995).
\50\ We do receive such information on a case-by-case basis only
if a cable operator appeals a local franchise authority's finding
that the operator does not qualify as a small cable operator
pursuant to section 76.1403(b) of the Commission's rules. See 47 CFR
76.1403(d).
---------------------------------------------------------------------------
8. Other Pay Services. Other pay television services are also
classified under Standard Industrial Classification (SIC) 4841, which
includes cable systems operators, closed circuit television services,
direct broadcast satellite services (DBS),51 multipoint
distribution systems (MDS),52 satellite master antenna
systems (SMATV), and subscription television services.
---------------------------------------------------------------------------
\51\ Direct Broadcast Services (DBS) are discussed with the
international services, infra.
\52\ Multipoint Distribution Services (MDS) are discussed with
the mass media services, infra.
---------------------------------------------------------------------------
Common Carrier Services and Related Entities
9. The most reliable source of information regarding the total
numbers of certain common carrier and related providers nationwide, as
well as the numbers of commercial wireless entities, appears to be data
the Commission publishes annually in its Telecommunications Industry
Revenue report, regarding the Telecommunications Relay Service
(TRS).53 According to data in the most recent report, there
are 3,459 interstate carriers.54 These carriers include,
inter alia, local exchange carriers, wireline carriers and service
providers, interexchange carriers, competitive access providers,
operator service providers, pay telephone operators, providers of
telephone toll service, providers of telephone exchange service, and
resellers.
---------------------------------------------------------------------------
\53\ FCC, Telecommunications Industry Revenue: TRS Fund
Worksheet Data, Figure 2 (Number of Carriers Paying Into the TRS
Fund by Type of Carrier) (Nov. 1997) (Telecommunications Industry
Revenue).
\54\ Id.
---------------------------------------------------------------------------
10. The SBA has defined establishments engaged in providing
``Radiotelephone Communications'' and ``Telephone Communications,
Except Radiotelephone'' to be small businesses when they have no more
than 1,500 employees.55 We discuss the total estimated
number of telephone companies falling within the two categories and the
number of small businesses in each, and we then attempt to refine
further those estimates to correspond with the categories of telephone
companies that are commonly used under our rules.
---------------------------------------------------------------------------
\55\ 13 CFR 121.201, Standard Industrial Classification (SIC)
codes 4812 and 4813. See also Executive Office of the President,
Office of Management and Budget, Standard Industrial Classification
Manual (1987).
---------------------------------------------------------------------------
11. Although some affected incumbent local exchange carriers
(ILECs) may have 1,500 or fewer employees, we do not believe that such
entities should be considered small entities within the meaning of the
RFA because they are either dominant in their field of operations or
are not independently owned and operated, and therefore by definition
not ``small entities'' or ``small business concerns'' under the RFA.
Accordingly, our use of the terms ``small entities'' and ``small
businesses'' does not encompass small ILECs. Out of an abundance of
caution, however, for regulatory flexibility analysis purposes, we will
separately consider small ILECs within this
[[Page 16667]]
analysis and use the term ``small ILECs'' to refer to any ILECs that
arguably might be defined by the SBA as ``small business concerns.''
56
---------------------------------------------------------------------------
\56\ 13 CFR 121.201, SIC code 4813. Since the time of the
Commission's 1996 decision, Implementation of the Local Competition
Provisions in the Telecommunications Act of 1996, First Report and
Order, 11 FCC Rcd 15499, 16144-45 (1996), 61 FR 45476 (Aug. 29,
1996), the Commission has consistently addressed in its regulatory
flexibility analyses the impact of its rules on such ILECs.
---------------------------------------------------------------------------
12. Total Number of Telephone Companies Affected. The U.S. Bureau
of the Census (``Census Bureau'') reports that, at the end of 1992,
there were 3,497 firms engaged in providing telephone services, as
defined therein, for at least one year.57 This number
contains a variety of different categories of carriers, including local
exchange carriers, interexchange carriers, competitive access
providers, cellular carriers, mobile service carriers, operator service
providers, pay telephone operators, personal communications services
providers, covered specialized mobile radio providers, and resellers.
It seems certain that some of those 3,497 telephone service firms may
not qualify as small entities or small ILECs because they are not
``independently owned and operated.'' 58 For example, a PCS
provider that is affiliated with an interexchange carrier having more
than 1,500 employees would not meet the definition of a small business.
It is reasonable to conclude that fewer than 3,497 telephone service
firms are small entity telephone service firms or small ILECs that may
be affected by the proposed rules, if adopted.
---------------------------------------------------------------------------
\57\ U.S. Department of Commerce, Bureau of the Census, 1992
Census of Transportation, Communications, and Utilities:
Establishment and Firm Size, at Firm Size 1-123 (1995) (1992
Census).
\58\ See generally 15 U.S.C. 632(a)(1).
---------------------------------------------------------------------------
13. Wireline Carriers and Service Providers. The SBA has developed
a definition of small entities for telephone communications companies
except radiotelephone (wireless) companies. The Census Bureau reports
that there were 2,321 such telephone companies in operation for at
least one year at the end of 1992.59 According to the SBA's
definition, a small business telephone company other than a
radiotelephone company is one employing no more than 1,500
persons.60 All but 26 of the 2,321 non-radiotelephone
companies listed by the Census Bureau were reported to have fewer than
1,000 employees. Thus, even if all 26 of those companies had more than
1,500 employees, there would still be 2,295 non-radiotelephone
companies that might qualify as small entities or small ILECs. We do
not have data specifying the number of these carriers that are not
independently owned and operated, and thus are unable at this time to
estimate with greater precision the number of wireline carriers and
service providers that would qualify as small business concerns under
the SBA's definition. Consequently, we estimate that fewer than 2,295
small telephone communications companies other than radiotelephone
companies are small entities or small ILECs that may be affected by the
proposed rules, if adopted.
---------------------------------------------------------------------------
\59\ 1992 Census, supra, at Firm Size 1-123.
\60\ 13 CFR 121.201, SIC code 4813.
---------------------------------------------------------------------------
14. Local Exchange Carriers. Neither the Commission nor the SBA has
developed a definition for small providers of local exchange services
(LECs). The closest applicable definition under the SBA rules is for
telephone communications companies other than radiotelephone (wireless)
companies.61 According to the most recent Telecommunications
Industry Revenue data, 1,371 carriers reported that they were engaged
in the provision of local exchange services.62 We do not
have data specifying the number of these carriers that are either
dominant in their field of operations, are not independently owned and
operated, or have more than 1,500 employees, and thus are unable at
this time to estimate with greater precision the number of LECs that
would qualify as small business concerns under the SBA's definition.
Consequently, we estimate that fewer than 1,371 providers of local
exchange service are small entities or small ILECs that may be affected
by the proposed rules, if adopted.
---------------------------------------------------------------------------
\61\ Id.
\62\ Telecommunications Industry Revenue, Figure 2.
---------------------------------------------------------------------------
15. Interexchange Carriers. Neither the Commission nor the SBA has
developed a definition of small entities specifically applicable to
providers of interexchange services (IXCs). The closest applicable
definition under the SBA rules is for telephone communications
companies other than radiotelephone (wireless) companies.63
According to the most recent Telecommunications Industry Revenue data,
143 carriers reported that they were engaged in the provision of
interexchange services.64 We do not have data specifying the
number of these carriers that are not independently owned and operated
or have more than 1,500 employees, and thus are unable at this time to
estimate with greater precision the number of IXCs that would qualify
as small business concerns under the SBA's definition. Consequently, we
estimate that there are fewer than 143 small entity IXCs that may be
affected by the proposed rules, if adopted.
---------------------------------------------------------------------------
\63\ 13 CFR 121.201, SIC code 4813.
\64\ Telecommunications Industry Revenue, Figure 2.
---------------------------------------------------------------------------
16. Competitive Access Providers. Neither the Commission nor the
SBA has developed a definition of small entities specifically
applicable to competitive access services providers (CAPs). The closest
applicable definition under the SBA rules is for telephone
communications companies other than except radiotelephone (wireless)
companies.65 According to the most recent Telecommunications
Industry Revenue data, 109 carriers reported that they were engaged in
the provision of competitive access services.66 We do not
have data specifying the number of these carriers that are not
independently owned and operated, or have more than 1,500 employees,
and thus are unable at this time to estimate with greater precision the
number of CAPs that would qualify as small business concerns under the
SBA's definition. Consequently, we estimate that there are fewer than
109 small entity CAPs that may be affected by the proposed rules, if
adopted.
---------------------------------------------------------------------------
\65\ 13 CFR 121.201, SIC code 4813.
\66\ Telecommunications Industry Revenue, Figure 2.
---------------------------------------------------------------------------
17. Operator Service Providers. Neither the Commission nor the SBA
has developed a definition of small entities specifically applicable to
providers of operator services. The closest applicable definition under
the SBA rules is for telephone communications companies other than
radiotelephone (wireless) companies.67 According to the most
recent Telecommunications Industry Revenue data, 27 carriers reported
that they were engaged in the provision of operator
services.68 We do not have data specifying the number of
these carriers that are not independently owned and operated or have
more than 1,500 employees, and thus are unable at this time to estimate
with greater precision the number of operator service providers that
would qualify as small business concerns under the SBA's definition.
Consequently, we estimate that there are fewer than 27 small entity
operator service providers that may be affected by the proposed rules,
if adopted.
---------------------------------------------------------------------------
\67\ 13 CFR 121.201, SIC code 4813.
\68\ Telecommunications Industry Revenue, Figure 2.
---------------------------------------------------------------------------
18. Pay Telephone Operators. Neither the Commission nor the SBA has
[[Page 16668]]
developed a definition of small entities specifically applicable to pay
telephone operators. The closest applicable definition under SBA rules
is for telephone communications companies other than radiotelephone
(wireless) companies.69 According to the most recent
Telecommunications Industry Revenue data, 441 carriers reported that
they were engaged in the provision of pay telephone
services.70 We do not have data specifying the number of
these carriers that are not independently owned and operated or have
more than 1,500 employees, and thus are unable at this time to estimate
with greater precision the number of pay telephone operators that would
qualify as small business concerns under the SBA's definition.
Consequently, we estimate that there are fewer than 441 small entity
pay telephone operators that may be affected by the proposed rules, if
adopted.
---------------------------------------------------------------------------
\69\ 13 CFR 121.201, SIC code 4813.
\70\ Telecommunications Industry Revenue, Figure 2.
---------------------------------------------------------------------------
19. Resellers (including debit card providers). Neither the
Commission nor the SBA has developed a definition of small entities
specifically applicable to resellers. The closest applicable SBA
definition for a reseller is a telephone communications company other
than radiotelephone (wireless) companies.71 According to the
most recent Telecommunications Industry Revenue data, 339 reported that
they were engaged in the resale of telephone service.72 We
do not have data specifying the number of these carriers that are not
independently owned and operated or have more than 1,500 employees, and
thus are unable at this time to estimate with greater precision the
number of resellers that would qualify as small business concerns under
the SBA's definition. Consequently, we estimate that there are fewer
than 339 small entity resellers that may be affected by the proposed
rules, if adopted.
---------------------------------------------------------------------------
\71\ 13 CFR 121.201, SIC code 4813.
\72\ Telecommunications Industry Revenue, Figure 2.
---------------------------------------------------------------------------
20. 800 Service Subscribers.73 Neither the Commission
nor the SBA has developed a definition of small entities specifically
applicable to 800 service (``toll free'') subscribers. The most
reliable source of information regarding the number of 800 service
subscribers appears to be data the Commission collects on the 800
numbers in use.74 According to our most recent data, at the
end of 1995, the number of 800 numbers in use was 6,987,063. Similarly,
the most reliable source of information regarding the number of 888
service subscribers appears to be data the Commission collects on the
888 numbers in use.75 According to our most recent data, at
the end of August 1996, the number of 888 numbers that had been
assigned was 2,014,059. We do not have data specifying the number of
these subscribers that are not independently owned and operated or have
more than 1,500 employees, and thus are unable at this time to estimate
with greater precision the number of toll free subscribers that would
qualify as small business concerns under the SBA's definition.
Consequently, we estimate that there are fewer than 6,987,063 small
entity 800 subscribers and fewer than 2,014,059 small entity 888
subscribers that may be affected by the proposed rules, if adopted.
---------------------------------------------------------------------------
\73\ We include all toll-free number subscribers in this
category, including 888 numbers.
\74\ FCC, CCB Industry Analysis Division, FCC Releases, Study on
Telephone Trends, Tbl. 20 (May 16, 1996).
\75\ FCC, CCB Industry Analysis Division, Long Distance Carrier
Code Assignments, p. 80, Tbl. 10B (Oct. 18, 1996).
---------------------------------------------------------------------------
International Services
21. The Commission has not developed a definition of small entities
applicable to licensees in the international services. Therefore, the
applicable definition of small entity is generally the definition under
the SBA rules applicable to Communications Services, Not Elsewhere
Classified (NEC).76 This definition provides that a small
entity is expressed as one with $11.0 million or less in annual
receipts.77 According to the Census Bureau, there were a
total of 848 communications services providers, NEC, in operation in
1992, and a total of 775 had annual receipts of less than $9.999
million.78 The Census report does not provide more precise
data.
---------------------------------------------------------------------------
\76\ An exception is the Direct Broadcast Satellite (DBS)
Service, infra.
\77\ 13 CFR 120.121, SIC code 4899.
\78\ 1992 Economic Census Industry and Enterprise Receipts Size
Report, Table 2D, SIC code 4899 (U.S. Bureau of the Census data
under contract to the Office of Advocacy of the U.S. Small Business
Administration).
---------------------------------------------------------------------------
22. International Broadcast Stations. Commission records show that
there are 20 international broadcast station licensees. We do not
request nor collect annual revenue information, and thus are unable to
estimate the number of international broadcast licensees that would
constitute a small business under the SBA definition. However, the
Commission estimates that only six international broadcast stations are
subject to regulatory fee payments.
23. International Public Fixed Radio (Public and Control Stations).
There are 3 licensees in this service subject to payment of regulatory
fees. We do not request nor collect annual revenue information, and
thus are unable to estimate the number of international broadcast
licensees that would constitute a small business under the SBA
definition.
24. Fixed Satellite Transmit/Receive Earth Stations. There are
approximately 3100 earth station authorizations, a portion of which are
Fixed Satellite Transmit/Receive Earth Stations. We do not request nor
collect annual revenue information, and thus are unable to estimate the
number of the earth stations that would constitute a small business
under the SBA definition.
25. Fixed Satellite Small Transmit/Receive Earth Stations. There
are 3100 earth station authorizations, a portion of which are Fixed
Satellite Small Transmit/Receive Earth Stations. We do not request nor
collect annual revenue information, and thus are unable to estimate the
number of fixed satellite transmit/receive earth stations that may
constitute a small business under the SBA definition.
26. Fixed Satellite Very Small Aperture Terminal (VSAT) Systems.
These stations operate on a primary basis, and frequency coordination
with terrestrial microwave systems is not required. Thus, a single
``blanket'' application may be filed for a specified number of small
antennas and one or more hub stations. The Commission has processed 377
applications. We do not request nor collect annual revenue information,
and thus are unable to estimate the number of VSAT systems that would
constitute a small business under the SBA definition.
27. Mobile Satellite Earth Stations. There are 11 licensees. We do
not request nor collect annual revenue information, and thus are unable
to estimate of the number of mobile satellite earth stations that would
constitute a small business under the SBA definition.
28. Radio Determination Satellite Earth Stations. There are four
licensees. We do not request nor collect annual revenue information,
and thus are unable to estimate the number of radio determination
satellite earth stations that would constitute a small business under
the SBA definition.
29. Space Stations (Geostationary). Commission records reveal that
there are 43 Geostationary Space Station licensees. We do not request
nor collect annual revenue information, and thus are unable to estimate
the number of geostationary space stations that would constitute a
small business under the SBA definition.
[[Page 16669]]
30. Space Stations (Non-Geostationary). There are 12 Non-
Geostationary Space Station licensees, of which only two systems are
operational. We do not request nor collect annual revenue information,
and thus are unable to estimate of the number of non-geostationary
space stations that would constitute a small business under the SBA
definition.
31. Direct Broadcast Satellites. Because DBS provides subscription
services, DBS falls within the SBA-recognized definition of ``Cable and
Other Pay Television Services.''79 This definition provides
that a small entity is one with $11.0 million or less in annual
receipts.80 As of December 1996, there were eight DBS
licensees. However, the Commission does not collect annual revenue data
for DBS and, therefore, is unable to ascertain the number of small DBS
licensees that could be impacted by these proposed rules. Although DBS
service requires a great investment of capital for operation, there are
several new entrants in this field that may not yet have generated $11
million in annual receipts, and therefore may be categorized as small
businesses, if independently owned and operated.
---------------------------------------------------------------------------
\79\ 13 CFR 120.121, SIC code 4841.
\80\ 13 CFR 121.201, SIC code 4841.
---------------------------------------------------------------------------
Mass Media Services
32. Commercial Radio and Television Services. The proposed rules
and policies will apply to television broadcasting licensees and radio
broadcasting licensees.\81\ The SBA defines a television broadcasting
station that has $10.5 million or less in annual receipts as a small
business.\82\ Television broadcasting stations consist of
establishments primarily engaged in broadcasting visual programs by
television to the public, except cable and other pay television
services.\83\ Included in this industry are commercial, religious,
educational, and other television stations.\84\ Also included are
establishments primarily engaged in television broadcasting and which
produce taped television program materials.\85\ Separate establishments
primarily engaged in producing taped television program materials are
classified under another SIC number. \86\ There were 1,509 television
stations operating in the nation in 1992.\87\ That number has remained
fairly constant as indicated by the approximately 1,564 operating
television broadcasting stations in the nation as of December 31,
1997.\88\ For 1992,\89\ the number of television stations that produced
less than $10.0 million in revenue was 1,155 establishments.\90\ Only
commercial stations are subject to regulatory fees.
---------------------------------------------------------------------------
\81\ While we tentatively believe that the SBA's definition of
``small business'' greatly overstates the number of radio and
television broadcast stations that are small businesses and is not
suitable for purposes of determining the impact of the proposals on
small television and radio stations, for purposes of this Notice we
utilize the SBA's definition in determining the number of small
businesses to which the proposed rules would apply. We reserve the
right to adopt, in the future, a more suitable definition of ``small
business'' as applied to radio and television broadcast stations or
other entities subject to the proposed rules in this Notice, and to
consider further the issue of the number of small entities that are
radio and television broadcasters or other small media entities. See
Report and Order in MM Docket No. 93-48 (Children's Television
Programming), 11 FCC Rcd 10660, 10737-38 (1996), 61 FR 43981 (Aug.
27, 1996), citing 5 U.S.C. 601(3).
\82\ 13 CFR 121.201, SIC code 4833.
\83\ Economics and Statistics Administration, Bureau of Census,
U.S. Department of Commerce, 1992 Census of Transportation,
Communications and Utilities, Establishment and Firm Size, Series
UC92-S-1, Appendix A-9 (1995) (1992 Census, Series UC92-S-1).
\84\ Id.; see Executive Office of the President, Office of
Management and Budget, Standard Industrial Classification Manual
(1987), at 283, which describes ``Television Broadcasting Stations''
(SIC code 4833) as: ``Establishments primarily engaged in
broadcasting visual programs by television to the public, except
cable and other pay television services. Included in this industry
are commercial, religious, educational and other television
stations. Also included here are establishments primarily engaged in
television broadcasting and which produce taped television program
materials.''
\85\ 1992 Census, Series UC92-S-1, at Appendix A-9.
\86\ Id., SIC code 7812 (Motion Picture and Video Tape
Production); SIC code 7922 (Theatrical Producers and Miscellaneous
Theatrical Services) (producers of live radio and television
programs).
\87\ FCC News Release No. 31327 (Jan. 13, 1993); 1992 Census,
Series UC92-S-1, at Appendix A-9.
\88\ FCC News Release, ``Broadcast Station Totals as of Dec. 31,
1997.''
\89\ A census to determine the estimated number of
Communications establishments is performed every five years, in
years ending with a ``2'' or ``7.'' See 1992 Census, Series UC92-S-
1, at III.
\90\ The amount of $10 million was used to estimate the number
of small business establishments because the relevant Census
categories stopped at $9,999,999 and began at $10,000,000. No
category for $10.5 million existed. Thus, the number is as accurate
as it is possible to calculate with the available information.
---------------------------------------------------------------------------
33. Additionally, the Small Business Administration defines a radio
broadcasting station that has $5 million or less in annual receipts as
a small business.91 A radio broadcasting station is an
establishment primarily engaged in broadcasting aural programs by radio
to the public.92 Included in this industry are commercial,
religious, educational, and other radio stations.93 Radio
broadcasting stations which primarily are engaged in radio broadcasting
and which produce radio program materials are similarly
included.94 However, radio stations which are separate
establishments and are primarily engaged in producing radio program
material are classified under another SIC number.95 The 1992
Census indicates that 96 percent (5,861 of 6,127) radio station
establishments produced less than $5 million in revenue in
1992.96 Official Commission records indicate that 11,334
individual radio stations were operating in 1992.97 As of
December 31, 1997, Commission records indicate that 12,270 radio
stations were operating, of which 7,465 were FM stations.98
Only commercial stations are subject to regulatory fees.
---------------------------------------------------------------------------
\91\ 13 CFR 121.201, SIC code 4832.
\92\ 1992 Census, Series UC92-S-1, at Appendix A-9.
\93\ Id.
\94\ Id.
\95\ Id.
\96\ The Census Bureau counts radio stations located at the same
facility as one establishment. Therefore, each co-located AM/FM
combination counts as one establishment.
\97\ FCC News Release, No. 31327 (Jan. 13, 1993).
\98\ FCC News Release, ``Broadcast Station Totals as of December
31, 1997.''
---------------------------------------------------------------------------
34. Thus, the proposed rules, if adopted, will affect approximately
1,558 full power television stations, approximately 1,200 of which are
considered small businesses.99 Additionally, the proposed
rules will affect some 12,156 full power radio stations, approximately
11,670 of which are small businesses.100 These estimates may
overstate the number of small entities because the revenue figures on
which they are based do not include or aggregate revenues from non-
television or non-radio affiliated companies. There are also 1,952 low
power television stations (LPTV).101 Given the nature of
this service, we will presume that all LPTV licensees qualify as small
entities under the SBA definition.
---------------------------------------------------------------------------
\99\ We use the 77 percent figure of TV stations operating at
less than $10 million for 1992 and apply it to the 1997 total of
1558 TV stations to arrive at 1,200 stations categorized as small
businesses.
\100\ We use the 96% figure of radio station establishments with
less than $5 million revenue from the Census data and apply it to
the 12,088 individual station count to arrive at 11,605 individual
stations as small businesses.
\101\ FCC News Release, No. 7033 (Mar. 6, 1997).
---------------------------------------------------------------------------
Alternative Classification of Small Stations
35. An alternative way to classify small radio and television
stations is by number of employees. The Commission currently applies a
standard based on the number of employees in administering its Equal
Employment Opportunity Rule (EEO) for broadcasting.102 Thus,
radio or
[[Page 16670]]
television stations with fewer than five full-time employees are
exempted from certain EEO reporting and record keeping
requirements.103 We estimate that the total number of
broadcast stations with 4 or fewer employees is approximately
4,239.104
---------------------------------------------------------------------------
\102\ The Commission's definition of a small broadcast station
for purposes of applying its EEO rules was adopted prior to the
requirement of approval by the SBA pursuant to section 3(a) of the
Small Business Act, 15 U.S.C. 632(a), as amended by section 222 of
the Small Business Credit and Business Opportunity Enhancement Act
of 1992, Public Law 102-366, 222(b)(1), 106 Stat. 999 (1992), as
further amended by the Small Business Administration Reauthorization
and Amendments Act of 1994, Public Law 103-403, 301, 108 Stat. 4187
(1994). However, this definition was adopted after public notice and
the opportunity for comment. See Report and Order in Docket No.
18244, 23 FCC 2d 430 (1970), 35 FR 8925 (Jun. 6, 1970).
\103\ See, e.g., 47 CFR 73.3612 (Requirement to file annual
employment reports on Form 395 applies to licensees with five or
more full-time employees); First Report and Order in Docket No.
21474 (Amendment of Broadcast Equal Employment Opportunity Rules and
FCC Form 395), 70 FCC 2d 1466 (1979), 50 FR 50329 (Dec. 10, 1985).
The Commission is currently considering how to decrease the
administrative burdens imposed by the EEO rule on small stations
while maintaining the effectiveness of our broadcast EEO
enforcement. Order and Notice of Proposed Rule Making in MM Docket
No. 96-16 (Streamlining Broadcast EEO Rule and Policies, Vacating
the EEO Forfeiture Policy Statement and Amending Section 1.80 of the
Commission's Rules to Include EEO Forfeiture Guidelines), 11 FCC Rcd
5154 (1996), 61 FR 9964 (Mar. 12, 1996). One option under
consideration is whether to define a small station for purposes of
affording such relief as one with ten or fewer full-time employees.
\104\ Compilation of 1994 Broadcast Station Annual Employment
Reports (FCC Form B), Equal Opportunity Employment Branch, Mass
Media Bureau, FCC.
---------------------------------------------------------------------------
Auxiliary, Special Broadcast and Other Program Distribution Services
36. This service involves a variety of transmitters, generally used
to relay broadcast programming to the public (through translator and
booster stations) or within the program distribution chain (from a
remote news gathering unit back to the station). The Commission has not
developed a definition of small entities applicable to broadcast
auxiliary licensees. Therefore, the applicable definitions of small
entities are those, noted previously, under the SBA rules applicable to
radio broadcasting stations and television broadcasting
stations.105
---------------------------------------------------------------------------
\105\ 13 CFR 121.201, SIC code 4832.
---------------------------------------------------------------------------
37. There are currently 2,720 FM translators and boosters, 4,952 TV
translators.106 The FCC does not collect financial
information on any broadcast facility and the Department of Commerce
does not collect financial information on these auxiliary broadcast
facilities. We believe, however, that most, if not all, of these
auxiliary facilities could be classified as small businesses by
themselves. We also recognize that most translators and boosters are
owned by a parent station which, in some cases, would be covered by the
revenue definition of small business entity discussed above. These
stations would likely have annual revenues that exceed the SBA maximum
to be designated as a small business (either $5 million for a radio
station or $10.5 million for a TV station). Furthermore, they do not
meet the Small Business Act's definition of a ``small business
concern'' because they are not independently owned and
operated.107
---------------------------------------------------------------------------
\106\ FCC News Release, Broadcast Station Totals as of December
31, 1996, No. 71831 (Jan. 21, 1997).
\107\ 15 U.S.C. 632.
---------------------------------------------------------------------------
38. Multipoint Distribution Service (MDS). This service involves a
variety of transmitters, which are used to relay programming to the
home or office, similar to that provided by cable television
systems.108 In connection with the 1996 MDS auction the
Commission defined small businesses as entities that had annual average
gross revenues for the three preceding years not in excess of $40
million.109 This definition of a small entity in the context
of MDS auctions has been approved by the SBA.110 These
stations were licensed prior to implementation of Section 309(j) of the
Communications Act of 1934, as amended.111 Licenses for new
MDS facilities are now awarded to auction winners in Basic Trading
Areas (BTAs) and BTA-like areas.112 The MDS auctions
resulted in 67 successful bidders obtaining licensing opportunities for
493 BTAs. Of the 67 auction winners, 61 meet the definition of a small
business. There are 1,573 previously authorized and proposed MDS
stations currently licensed. Thus, we conclude that there are 1,634 MDS
providers that are small businesses as deemed by the SBA and the
Commission's auction rules. It is estimated, however, that only 1,650
MDS licensees are subject to regulatory fees and the number which are
small businesses is unknown.
---------------------------------------------------------------------------
\108\ For purposes of this item, MDS includes both the single
channel Multipoint Distribution Service (MDS) and the Multichannel
Multipoint Distribution Service (MMDS).
\109\ 47 CFR 1.2110(a)(1).
\110\ Amendment of Parts 21 and 74 of the Commission's Rules
with Regard to Filing Procedures in the Multipoint Distribution
Service and in the Instructional Television Fixed Service and
Implementation of Section 309(j) of the Communications Act--
Competitive Bidding, 10 FCC Rcd 9589 (1995), 60 FR 36524 (Jul. 17,
1995).
\111\ 47 U.S.C. 309(j).
\112\ Id. A Basic Trading Area (BTA) is the geographic area by
which the Multipoint Distribution Service is licensed. See Rand
McNally 1992 Commercial Atlas and Marketing Guide, 123rd Edition,
pp. 36-39.
---------------------------------------------------------------------------
Wireless and Commercial Mobile Services
39. Cellular Licensees. Neither the Commission nor the SBA has
developed a definition of small entities applicable to cellular
licensees. Therefore, the applicable definition of small entity is the
definition under the SBA rules applicable to radiotelephone (wireless)
companies. This provides that a small entity is a radiotelephone
company employing no more than 1,500 persons.113 According
to the Bureau of the Census, only twelve radiotelephone firms out of a
total of 1,178 such firms which operated during 1992 had 1,000 or more
employees.114 Therefore, even if all twelve of these firms
were cellular telephone companies, nearly all cellular carriers were
small businesses under the SBA's definition. In addition, we note that
there are 1,758 cellular licenses; however, a cellular licensee may own
several licenses. In addition, according to the most recent
Telecommunications Industry Revenue data, 804 carriers reported that
they were engaged in the provision of either cellular service or
Personal Communications Service (PCS) services, which are placed
together in the data.115 We do not have data specifying the
number of these carriers that are not independently owned and operated
or have more than 1,500 employees, and thus are unable at this time to
estimate with greater precision the number of cellular service carriers
that would qualify as small business concerns under the SBA's
definition. Consequently, we estimate that there are fewer than 804
small cellular service carriers that may be affected by the proposed
rules, if adopted.
---------------------------------------------------------------------------
\113\ 13 CFR 121.201, SIC code 4812.
\114\ 1992 Census, Series UC92-S-1, at Table 5, SIC code 4812.
\115\ Telecommunications Industry Revenue, Figure 2.
---------------------------------------------------------------------------
40. 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
definition of 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 definition under the SBA rules
applicable to Radiotelephone Communications companies. This definition
provides that a small entity is a radiotelephone company employing
[[Page 16671]]
no more than 1,500 persons.116 According to the Bureau of
the Census, only 12 radiotelephone firms out of a total of 1,178 such
firms which operated during 1992 had 1,000 or more
employees.117 Therefore, if this general ratio continues to
1999 in the context of Phase I 220 MHz licensees, we estimate that
nearly all such licensees are small businesses under the SBA's
definition.
---------------------------------------------------------------------------
\116\ 13 CFR 121.201, Standard Industrial Classification (SIC)
code 4812.
\117\ U.S. Bureau of the Census, U.S. Department of Commerce,
1992 Census of Transportation, Communications, and Utilities, UC92-
S-1, Subject Series, Establishment and Firm Size, Table 5,
Employment Size of Firms; 1992, SIC code 4812 (issued May 1995).
---------------------------------------------------------------------------
41. 220 MHz Radio Service--Phase II Licensees. The Phase II 220 MHz
service is a new service, and is subject to spectrum auctions. In the
220 MHz Third Report and Order we adopted criteria for defining small
businesses and very small businesses for purposes of determining their
eligibility for special provisions such as bidding credits and
installment payments.118 We have defined 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
defined as 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.119 The SBA has
approved these definitions.120 An auction of Phase II
licenses commenced on September 15, 1998, and closed on October 22,
1998.121 908 licenses were auctioned in 3 different-sized
geographic areas: three nationwide licenses, 30 Regional Economic Area
Group Licenses, and 875 Economic Area (EA) Licenses. Of the 908
licenses auctioned, 693 were sold. Companies claiming small business
status won: one of the Nationwide licenses, 67% of the Regional
licenses, and 54% of the EA licenses. As of January 22, 1999, the
Commission announced that it was prepared to grant 654 of the Phase II
licenses won at auction.122 A re-auction of the remaining,
unsold licenses is likely to take place during calendar year 1999.
---------------------------------------------------------------------------
\118\ 220 MHz Third Report and Order, 12 FCC Rcd 10943, 11068-
70, at paras. 291-295 (1997).
\119\ 220 MHz Third Report and Order, 12 FCC Rcd at 11068-69,
para. 291.
\120\ See Letter from A. Alvarez, Administrator, SBA, to D.
Phythyon, Chief, Wireless Telecommunications Bureau, FCC (Jan. 6,
1998).
\121\ See generally Public Notice, ``220 MHz Service Auction
Closes,'' Report No. WT 98-36 (Wireless Telecom. Bur. Oct. 23,
1998).
\122\ Public Notice, ``FCC Announces It is Prepared to Grant 654
Phase II 220 MHz Licenses After Final Payment is Made,'' Report No.
AUC-18-H, DA No. 99-229 (Wireless Telecom. Bur. Jan. 22, 1999).
---------------------------------------------------------------------------
42. Private and Common Carrier Paging. The Commission has proposed
a two-tier definition of small businesses in the context of auctioning
licenses in the Common Carrier Paging and exclusive Private Carrier
Paging services. Under the proposal, a small business will be defined
as either (1) an entity that, together with its affiliates and
controlling principals, has average gross revenues for the three
preceding years of not more than $3 million, or (2) an entity that,
together with affiliates and controlling principals, has average gross
revenues for the three preceding calendar years of not more than $15
million. Because the SBA has not yet approved this definition for
paging services, we will utilize the SBA's definition applicable to
radiotelephone companies, i.e., an entity employing no more than 1,500
persons.123 At present, there are approximately 24,000
Private Paging licenses and 74,000 Common Carrier Paging licenses.
According to the most recent Telecommunications Industry Revenue data,
172 carriers reported that they were engaged in the provision of either
paging or ``other mobile'' services, which are placed together in the
data.124 We do not have data specifying the number of these
carriers that are not independently owned and operated or have more
than 1,500 employees, and thus are unable at this time to estimate with
greater precision the number of paging carriers that would qualify as
small business concerns under the SBA's definition. Consequently, we
estimate that there are fewer than 172 small paging carriers that may
be affected by the proposed rules, if adopted. We estimate that the
majority of private and common carrier paging providers would qualify
as small entities under the SBA definition.
---------------------------------------------------------------------------
\123\ 13 CFR 121.201, SIC code 4812.
\124\ Telecommunications Industry Revenue, Figure 2.
---------------------------------------------------------------------------
43. Mobile Service Carriers. Neither the Commission nor the SBA has
developed a definition of small entities specifically applicable to
mobile service carriers, such as paging companies. As noted above in
the section concerning paging service carriers, the closest applicable
definition under the SBA rules is that for radiotelephone (wireless)
companies,125 and the most recent Telecommunications
Industry Revenue data shows that 172 carriers reported that they were
engaged in the provision of either paging or ``other mobile''
services.126 Consequently, we estimate that there are fewer
than 172 small mobile service carriers that may be affected by the
proposed rules, if adopted.
---------------------------------------------------------------------------
\125\ 13 CFR 121.201, SIC code 4812.
\126\ Telecommunications Industry Revenue, Figure 2.
---------------------------------------------------------------------------
44. Broadband Personal Communications Service (PCS). The broadband
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 less than $40 million in the three previous
calendar years.127 For Block F, an additional classification
for ``very small business'' was added and is defined as an entity that,
together with their affiliates, has average gross revenues of not more
than $15 million for the preceding three calendar years.128
These regulations defining ``small entity'' in the context of broadband
PCS auctions have been approved by the SBA.129 No small
businesses within the SBA-approved definition 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% of the
1,479 licenses for Blocks D, E, and F.130 Based on this
information, we conclude that the number of small broadband PCS
licensees will include the 90 winning C Block bidders and the 93
qualifying bidders in the D, E, and F blocks, for a total of 183 small
entity PCS providers as defined by the SBA and the Commission's auction
rules.
---------------------------------------------------------------------------
\127\ See Amendment of Parts 20 and 24 of the Commission's
Rules--Broadband PCS Competitive Bidding and the Commercial Mobile
Radio Service Spectrum Cap, Report and Order, FCC 96-278, WT Docket
No. 96-59, paras. 57-60 (released Jun. 24, 1996), 61 FR 33859 (Jul.
1, 1996); see also 47 CFR 24.720(b).
\128\ See Amendment of Parts 20 and 24 of the Commission's
Rules--Broadband PCS Competitive Bidding and the Commercial Mobile
Radio Service Spectrum Cap, Report and Order, FCC 96-278, WT Docket
No. 96-59, para. 60 (1996), 61 FR 33859 (Jul. 1, 1996).
\129\ See, e.g., Implementation of Section 309(j) of the
Communications Act--Competitive Bidding, PP Docket No. 93-253, Fifth
Report and Order, 9 FCC Rcd 5532, 5581-84 (1994).
\130\ FCC News, Broadband PCS, D, E and F Block Auction Closes,
No. 71744 (released Jan. 14, 1997).
---------------------------------------------------------------------------
45. Narrowband PCS. The Commission has auctioned nationwide and
regional licenses for narrowband PCS. There are 11 nationwide and 30
regional licensees for narrowband PCS. The Commission does not have
sufficient information to determine whether any of these licensees are
small businesses within the SBA-approved
[[Page 16672]]
definition for radiotelephone companies. At present, there have been no
auctions held for the major trading area (MTA) and basic trading area
(BTA) narrowband PCS licenses. The Commission anticipates a total of
561 MTA licenses and 2,958 BTA licenses will be awarded by auction.
Such auctions have not yet been scheduled, however. Given that nearly
all radiotelephone companies have no more than 1,500 employees and that
no reliable estimate of the number of prospective MTA and BTA
narrowband licensees can be made, we assume, for purposes of this IRFA,
that all of the licenses will be awarded to small entities, as that
term is defined by the SBA.
46. Rural Radiotelephone Service. The Commission has not adopted a
definition of small entity specific to the Rural Radiotelephone
Service.131 A significant subset of the Rural Radiotelephone
Service is the Basic Exchange Telephone Radio Systems
(BETRS).132 We will use the SBA's definition applicable to
radiotelephone companies, i.e., an entity employing no more than 1,500
persons.133 There are approximately 1,000 licensees in the
Rural Radiotelephone Service, and we estimate that almost all of them
qualify as small entities under the SBA's definition.
---------------------------------------------------------------------------
\131\ The service is defined in section 22.99 of the
Commission's rules, 47 CFR 22.99.
\132\ BETRS is defined in sections 22.757 and 22.759 of the
Commission's rules, 47 CFR 22.757 and 22.759.
\133\ 13 CFR 121.201, SIC code 4812.
---------------------------------------------------------------------------
47. Air-Ground Radiotelephone Service. The Commission has not
adopted a definition of small entity specific to the Air-Ground
Radiotelephone Service.134 Accordingly, we will use the
SBA's definition applicable to radiotelephone companies, i.e., an
entity employing no more than 1,500 persons.135 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
definition.
---------------------------------------------------------------------------
\134\ The service is defined in section 22.99 of the
Commission's rules, 47 CFR 22.99.
\135\ 13 CFR 121.201, SIC code 4812.
---------------------------------------------------------------------------
48. Specialized Mobile Radio (SMR). The Commission awards bidding
credits in auctions for geographic area 800 MHz and 900 MHz SMR
licenses to firms that had revenues of no more than $15 million in each
of the three previous calendar years.136 In the context of
900 MHz SMR, this regulation defining ``small entity'' has been
approved by the SBA; approval concerning 800 MHz SMR is being sought.
---------------------------------------------------------------------------
\136\ 47 CFR 90.814(b)(1).
---------------------------------------------------------------------------
49. The proposed fees in the NPRM apply to SMR providers in the 800
MHz and 900 MHz bands that either hold geographic area licenses or have
obtained extended implementation authorizations. We do 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. We assume, for purposes of this
IRFA, that all of the remaining existing extended implementation
authorizations are held by small entities, as that term is defined by
the SBA.
50. For geographic area licenses in the 900 MHz SMR band, there are
60 who qualified as small entities. For the 800 MHz SMR's, 38 are small
or very small entities.
51. Private Land Mobile Radio (PLMR). PLMR systems serve an
essential role in a range of industrial, business, land transportation,
and public safety activities. These radios are used by companies of all
sizes operating in all U.S. business categories. The Commission has not
developed a definition of small entity specifically applicable to PLMR
licensees due to the vast array of PLMR users. For the purpose of
determining whether a licensee is a small business as defined by the
SBA, each licensee would need to be evaluated within its own business
area.
52. The Commission is unable at this time to estimate the number of
small businesses which could be impacted by the rules. However, the
Commission's 1994 Annual Report on PLMRs 137 indicates that
at the end of fiscal year 1994 there were 1,087,267 licensees operating
12,481,989 transmitters in the PLMR bands below 512 MHz. Because any
entity engaged in a commercial activity is eligible to hold a PLMR
license, the proposed rules in this context could potentially impact
every small business in the United States.
---------------------------------------------------------------------------
\137\ Federal Communications Commission, 60th Annual Report,
Fiscal Year 1994, at 116.
---------------------------------------------------------------------------
53. Amateur Radio Service. We estimate that 6,800 applicants will
apply for vanity call signs in FY 1999. All are presumed to be
individuals. All other amateur licensees are exempt from payment of
regulatory fees.
54. Aviation and Marine Radio Service. Small businesses in the
aviation and marine radio services use a marine very high frequency
(VHF) radio, any type of emergency position indicating radio beacon
(EPIRB) and/or radar, a VHF aircraft radio, and/or any type of
emergency locator transmitter (ELT). The Commission has not developed a
definition of small entities specifically applicable to these small
businesses. Therefore, the applicable definition of small entity is the
definition under the SBA rules for radiotelephone
communications.138
---------------------------------------------------------------------------
\138\ 13 CFR 121.201, SIC code 4812.
---------------------------------------------------------------------------
55. Most applicants for recreational licenses are individuals.
Approximately 581,000 ship station licensees and 131,000 aircraft
station licensees operate domestically and are not subject to the radio
carriage requirements of any statute or treaty. Therefore, for purposes
of our evaluations and conclusions in this IRFA, we estimate that there
may be at least 712,000 potential licensees which are individuals or
are small entities, as that term is defined by the SBA. We estimate,
however, that only 16,800 will be subject to FY 1999 regulatory fees.
56. Fixed Microwave Services. Microwave services include common
carrier,139 private-operational fixed,140 and
broadcast auxiliary radio services.141 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 yet defined a small
business with respect to microwave services. For purposes of this IRFA,
we will utilize the SBA's definition applicable to radiotelephone
companies--i.e., an entity with no more than 1,500
persons.142 We estimate, for this purpose, that all of the
Fixed Microwave licensees (excluding broadcast auxiliary licensees)
would qualify as small entities under the SBA
[[Page 16673]]
definition for radiotelephone companies.
---------------------------------------------------------------------------
\139\ 47 CFR 101 et seq. (formerly, part 21 of the Commission's
Rules).
\140\ Persons eligible under parts 80 and 90 of the Commission's
rules can use Private Operational-Fixed Microwave services. See 47
CFR parts 80 and 90. Stations in this service are called
operational-fixed to distinguish them from common carrier and public
fixed stations. Only the licensee may use the operational-fixed
station, and only for communications related to the licensee's
commercial, industrial, or safety operations.
\141\ Auxiliary Microwave Service is governed by part 74 of
Title 47 of the Commission's rules. See 47 CFR 74 et seq. Available
to licensees of broadcast stations and to broadcast and cable
network entities, broadcast auxiliary microwave stations are used
for relaying broadcast television signals from the studio to the
transmitter, or between two points such as a main studio and an
auxiliary studio. The service also includes mobile TV pickups, which
relay signals from a remote location back to the studio.
\142\ 13 CFR 121.201, SIC 4812.
---------------------------------------------------------------------------
57. Public Safety Radio Services. Public Safety radio services
include police, fire, local government, forestry conservation, highway
maintenance, and emergency medical services.143 There are a
total of approximately 127,540 licensees within these services.
Governmental entities as well as private businesses comprise the
licensees for these services. As indicated supra in paragraph four of
this IRFA, all governmental entities with populations of less than
50,000 fall within the definition of a small entity.144 All
licensees in this category are exempt from the payment of regulatory
fees.
---------------------------------------------------------------------------
\143\ With the exception of the special emergency service, these
services are governed by Subpart B of part 90 of the Commission's
rules, 47 CFR 90.15-90.27. The police service includes 26,608
licensees that serve state, county, and municipal enforcement
through telephony (voice), telegraphy (code) and teletype and
facsimile (printed material). The fire radio service includes 22,677
licensees comprised of private volunteer or professional fire
companies as well as units under governmental control. The local
government service that is presently comprised of 40,512 licensees
that are state, county, or municipal entities that use the radio for
official purposes not covered by other public safety services. There
are 7,325 licensees within the forestry service which is comprised
of licensees from state departments of conservation and private
forest organizations who set up communications networks among fire
lookout towers and ground crews. The 9,480 state and local
governments are licensed to highway maintenance service provide
emergency and routine communications to aid other public safety
services to keep main roads safe for vehicular traffic. The 1,460
licensees in the Emergency Medical Radio Service (EMRS) use the 39
channels allocated to this service for emergency medical service
communications related to the delivery of emergency medical
treatment. 47 CFR 90.15-90.27. The 19,478 licensees in the special
emergency service include medical services, rescue organizations,
veterinarians, handicapped persons, disaster relief organizations,
school buses, beach patrols, establishments in isolated areas,
communications standby facilities, and emergency repair of public
communications facilities. 47 CFR 90.33-90.55.
\144\ 5 U.S.C. 601(5).
---------------------------------------------------------------------------
58. Personal Radio Services. Personal radio services provide short-
range, low power radio for personal communications, radio signalling,
and business communications not provided for in other services. The
services include the citizen's band (CB) radio service, general mobile
radio service (GMRS), radio control radio service, and family radio
service (FRS).145 Inasmuch as the CB, GMRS, and FRS
licensees are individuals, no small business definition applies for
these services. We are unable at this time to estimate the number of
other licensees that would qualify as small under the SBA's definition;
however, only GMRS licensees are subject to regulatory fees.
---------------------------------------------------------------------------
\145\ Licensees in the Citizens Band (CB) Radio Service, General
Mobile Radio Service (GMRS), Radio Control (R/C) Radio Service and
Family Radio Service (FRS) are governed by Subpart D, Subpart A,
Subpart C, and Subpart B, respectively, of part 95 of the
Commission's rules. 47 CFR 95.401-95.428; 95.1-95.181; 95.201-
95.225; 47 CFR 95.191-95.194.
---------------------------------------------------------------------------
59. Offshore Radiotelephone Service. This service operates on
several UHF TV broadcast channels that are not used for TV broadcasting
in the coastal area of the states bordering the Gulf of
Mexico.146 At present, there are approximately 55 licensees
in this service. We are unable at this time to estimate the number of
licensees that would qualify as small under the SBA's definition for
radiotelephone communications.
---------------------------------------------------------------------------
\146\ This service is governed by subpart I of part 22 of the
Commission's rules. See 47 CFR 22.1001-22.1037.
---------------------------------------------------------------------------
60. Wireless Communications Services. This service can be used for
fixed, mobile, radiolocation and digital audio broadcasting satellite
uses. The Commission defined ``small business'' for the wireless
communications services (WCS) auction as an entity with average gross
revenues of $40 million for each of the three preceding years, and a
``very small business'' as an entity with average gross revenues of $15
million for each of the three preceding years. The Commission auctioned
geographic area licenses in the WCS service. In the auction, there were
seven winning bidders that qualified as very small business entities,
and one that qualified as a small business entity. We conclude that the
number of geographic area WCS licensees affected includes these eight
entities.
IV. Description of Projected Reporting, Recordkeeping and Other
Compliance Requirements
61. With certain exceptions, the Commission's Schedule of
Regulatory Fees applies to all Commission licensees and regulatees.
Most licensees will be required to count the number of licenses or call
signs authorized, complete and submit an FCC Form 159 (``FCC Remittance
Advice''), and pay a regulatory fee based on the number of licenses or
call signs.147 Interstate telephone service providers must
compute their annual regulatory fee based on their adjusted gross
interstate revenue using information they already supply to the
Commission in compliance with the Telecommunications Relay Service
(TRS) Fund, and they must complete and submit the FCC Form 159.
Compliance with the fee schedule will require some licensees to
tabulate the number of units (e.g., cellular telephones, pagers, cable
TV subscribers) they have in service, and complete and submit an FCC
Form 159. Licensees ordinarily will keep a list of the number of units
they have in service as part of their normal business practices. No
additional outside professional skills are required to complete the FCC
Form 159, and it can be completed by the employees responsible for an
entity's business records.
---------------------------------------------------------------------------
\147\ The following categories are exempt from the Commission's
Schedule of Regulatory Fees: Amateur radio licensees (except
applicants for vanity call signs) and operators in other non-
licensed services (e.g., Personal Radio, part 15, ship and
aircraft). Governments and non-profit (exempt under section 501(c)
of the Internal Revenue Code) entities are exempt from payment of
regulatory fees and need not submit payment. Non-commercial
educational broadcast licensees are exempt from regulatory fees as
are licensees of auxiliary broadcast services such as low power
auxiliary stations, television auxiliary service stations, remote
pickup stations and aural broadcast auxiliary stations where such
licenses are used in conjunction with commonly owned non-commercial
educational stations. Emergency Alert System licenses for auxiliary
service facilities are also exempt as are instructional television
fixed service licensees. Regulatory fees are automatically waived
for the licensee of any translator station that: (1) is not licensed
to, in whole or in part, and does not have common ownership with,
the licensee of a commercial broadcast station; (2) does not derive
income from advertising; and (3) is dependent on subscriptions or
contributions from members of the community served for support.
Receive only earth station permittees are exempt from payment of
regulatory fees. A regulatee will be relieved of its fee payment
requirement if its total fee due, including all categories of fees
for which payment is due by the entity, amounts to less than $10.
---------------------------------------------------------------------------
62. Each licensee must submit the FCC Form 159 to the Commission's
lockbox bank after computing the number of units subject to the fee. As
an option, licensees are permitted to file electronically or on
computer diskette to minimize the burden of submitting multiple copies
of the FCC Form 159. This latter, optional procedure may require
additional technical skills. Licensees who pay small fees in advance
supply fee information as part of their application and do not need to
use the FCC Form 159.
63. Licensees and regulatees are advised that failure to submit the
required regulatory fee in a timely manner will subject the licensee or
regulatee to a late payment fee of 25 percent in addition to the
required fee.148 Until payment is received, no new or
pending applications will be processed, and existing authorizations may
be subject to rescission.149 Further, in accordance with the
Debt Collection Improvement Act of 1996, federal agencies may bar a
person or entity from obtaining a federal loan or loan
[[Page 16674]]
insurance guarantee if that person or entity fails to pay a delinquent
debt owed to any federal agency.150 Thus, debts owed to the
Commission may result in a person or entity being denied a federal loan
or loan guarantee pending before another federal agency until such
obligations are paid.151
---------------------------------------------------------------------------
\148\ 47 U.S.C. 1.1164(a).
\149\ 47 U.S.C. 1.1164(c).
\150\ Public Law 104-134, 110 Stat. 1321 (1996).
\151\ 31 U.S.C. 7701(c)(2)(B).
---------------------------------------------------------------------------
64. The Commission's rules currently provide for relief in
exceptional circumstances. Persons or entities that believe they have
been placed in the wrong regulatory fee category or are experiencing
extraordinary and compelling financial hardship, upon a showing that
such circumstances override the public interest in reimbursing the
Commission for its regulatory costs, may request a waiver, reduction or
deferment of payment of the regulatory fee.152 However,
timely submission of the required regulatory fee must accompany
requests for waivers or reductions. This will avoid any late payment
penalty if the request is denied. The fee will be refunded if the
request is granted. In exceptional and compelling instances (where
payment of the regulatory fee along with the waiver or reduction
request could result in reduction of service to a community or other
financial hardship to the licensee), the Commission will accept a
petition to defer payment along with a waiver or reduction request.
---------------------------------------------------------------------------
\152\ 47 U.S.C. 1.1166.
---------------------------------------------------------------------------
V. Steps Taken to Minimize Significant Economic Impact on Small
Entities, and Significant Alternatives Considered
65. The Omnibus Consolidated and Emergency Supplemental
Appropriations Act for FY 1999, Public Law 105-277 requires the
Commission to revise its Schedule of Regulatory Fees in order to
recover the amount of regulatory fees that Congress, pursuant to
Section 9(a) of the Communications Act, as amended, has required the
Commission to collect for Fiscal Year (FY) 1999.153 We seek
comment on the proposed methodology for implementing these statutory
requirements and any other potential impact of these proposals on small
entities.
---------------------------------------------------------------------------
\153\ 47 U.S.C.159(a).
---------------------------------------------------------------------------
66. With the use of actual cost accounting data for computation of
regulatory fees, we found that some fees which were very small in
previous years would have increased dramatically. The methodology
proposed in this NPRM minimizes this impact by limiting the amount of
increase and shifting costs to other services which, for the most part,
are larger entities.
67. Several categories of licensees and regulatees are exempt from
payment of regulatory fees. See, e.g., footnote 108, supra, and
Attachment H of the NPRM, infra.
VI. Federal Rules That May Duplicate, Overlap, or Conflict With the
Proposed Rules
68. None.
BILLING CODE 6712-01-P
[[Page 16675]]
[GRAPHIC] [TIFF OMITTED] TP06AP99.001
[[Page 16676]]
[GRAPHIC] [TIFF OMITTED] TP06AP99.002
[[Page 16677]]
[GRAPHIC] [TIFF OMITTED] TP06AP99.003
[[Page 16678]]
[GRAPHIC] [TIFF OMITTED] TP06AP99.004
[[Page 16679]]
[GRAPHIC] [TIFF OMITTED] TP06AP99.005
[[Page 16680]]
[GRAPHIC] [TIFF OMITTED] TP06AP99.006
[[Page 16681]]
[GRAPHIC] [TIFF OMITTED] TP06AP99.007
BILLING CODE 6712-01-C
[[Page 16682]]
Attachment F--Detailed Guidance on Who Must Pay Regulatory Fees
1. The guidelines below provide an explanation of regulatory fee
categories established by the Schedule of Regulatory Fees in section 9
(g) of the Communications Act,155 as modified in the instant
NPRM. Where regulatory fee categories need interpretation or
clarification, we have relied on the legislative history of section 9,
our own experience in establishing and regulating the Schedule of
Regulatory Fees for Fiscal Years (FY) 1994, 1995, 1996, 1997, and 1998
and the services subject to the fee schedule. The categories and
amounts set out in the schedule have been modified to reflect changes
in the number of payment units, additions and changes in the services
subject to the fee requirement and the benefits derived from the
Commission's regulatory activities, and to simplify the structure of
the schedule. The schedule may be similarly modified or adjusted in
future years to reflect changes in the Commission's budget and in the
services regulated by the Commission.156
---------------------------------------------------------------------------
\155\ 47 U.S.C. 159(g)
\156\ 47 U.S.C. 159(b)(2), (3).
---------------------------------------------------------------------------
2. Exemptions. Governments and nonprofit entities are exempt from
paying regulatory fees and should not submit payment. A nonprofit
entity may be asked to submit a current IRS Determination Letter
documenting that it is exempt from taxes under section 501 of the
Internal Revenue Code or the certification of a governmental authority
attesting to its nonprofit status. The governmental exemption applies
even where the government-owned or community-owned facility is in
competition with a commercial operation. Other specific exemptions are
discussed below in the descriptions of other particular service
categories.
1. Private Wireless Radio Services
3. Two levels of statutory fees were established for the Private
Wireless Radio Services--exclusive use services and shared use
services. Thus, licensees who generally receive a higher quality
communication channel due to exclusive or lightly shared frequency
assignments will pay a higher fee than those who share marginal quality
assignments. This dichotomy is consistent with the directive of section
9, that the regulatory fees reflect the benefits provided to the
licensees.157 In addition, because of the generally small
amount of the fees assessed against Private Wireless Radio Service
licensees, applicants for new licenses and reinstatements and for
renewal of existing licenses are required to pay a regulatory fee
covering the entire license term, with only a percentage of all
licensees paying a regulatory fee in any one year. Applications for
modification or assignment of existing authorizations do not require
the payment of regulatory fees. The expiration date of those
authorizations will reflect only the unexpired term of the underlying
license rather than a new license term.
---------------------------------------------------------------------------
\157\ 47 U.S.C. 159(b)(1)(A).
---------------------------------------------------------------------------
a. Exclusive Use Services
4. Private Mobile Radio Services (PMRS): Regulatees in this
category include those authorized under part 90 of the Commission's
rules to provide limited access Wireless Radio service that allows high
quality voice or digital communications between vehicles or to fixed
stations to further the business activities of the licensee. These
services, using the 220-222 MHz band and frequencies at 470 MHz and
above, may be offered on a private carrier basis in the Specialized
Mobile Radio Services (SMRS).158 For FY 1999, PMRS licensees
will pay a $13 annual regulatory fee per license, payable for an entire
five or ten year license term at the time of application for a new,
renewal, or reinstatement license.159 The total regulatory
fee due is either $65 for a license with a five year term or $130 for a
license with a 10 year term.
---------------------------------------------------------------------------
\158\ This category only applies to licensees of shared-use
private 220-222 MHz and 470 MHz and above in the Specialized Mobile
Radio (SMR) service who have elected not to change to the Commercial
Mobile Radio Service (CMRS). Those who have elected to change to the
CMRS are referred to paragraph 14 of this Attachment.
\159\ Although this fee category includes licenses with ten-year
terms, the estimated volume of ten-year license applications in FY
1999 is less than one-tenth of one percent and, therefore, is
statistically insignificant.
---------------------------------------------------------------------------
5. Microwave Services: These services include private and
commercial microwave systems and private and commercial carrier systems
authorized under part 101 of the Commission's rules to provide
telecommunications services between fixed points on a high quality
channel of communications. Microwave systems are often used to relay
data and to control railroad, pipeline, and utility equipment.
Commercial systems typically are used for video or data transmission or
distribution. For FY 1999, Microwave licensees will pay a $13 annual
regulatory fee per license, payable for an entire ten year license term
at the time of application for a new, renewal, or reinstatement
license. The total regulatory fee due is $130 for the ten year license
term.
6. Interactive Video Data Service (IVDS): The IVDS is a two-way,
point-to-multi-point radio service allocated high quality channels of
communications and authorized under part 95 of the Commission's rules.
The IVDS provides information, products, and services, and also the
capability to obtain responses from subscribers in a specific service
area. The IVDS is offered on a private carrier basis. The Commission
does not anticipate receiving any applications in the IVDS during FY
1999. Therefore, for FY 1999, there is no regulatory fee for IVDS
licensees.
b. Shared Use Services
7. Marine (Ship) Service: This service is a shipboard radio service
authorized under part 80 of the Commission's rules to provide
telecommunications between watercraft or between watercraft and shore-
based stations. Radio installations are required by domestic and
international law for large passenger or cargo vessels. Radio equipment
may be voluntarily installed on smaller vessels, such as recreational
boats. The Telecommunications Act of 1996 gave the Commission the
authority to license certain ship stations by rule rather than by
individual license. The Commission exercises that authority. Thus,
private boat operators sailing entirely within domestic U.S. waters and
who are not otherwise required by treaty or agreement to carry a radio,
are no longer required to hold a marine license, and they will not be
required to pay a regulatory fee. For FY 1999, parties required to be
licensed and those choosing to be licensed for Marine (Ship) Stations
will pay a $7 annual regulatory fee per station, payable for an entire
ten-year license term at the time of application for a new, renewal, or
reinstatement license. The total regulatory fee due is $70 for the ten
year license term.
8. Marine (Coast) Service: This service includes land-based
stations in the maritime services, authorized under part 80 of the
Commission's rules, to provide communications services to ships and
other watercraft in coastal and inland waterways. For FY 1999,
licensees of Marine (Coast) Stations will pay a $7 annual regulatory
fee per call sign, payable for the entire five year license term at the
time of application for a new, renewal, or reinstatement license. The
total regulatory fee due is $35 per call sign for the five-year license
term.
9. Private Land Mobile (Other) Services: These services include
Land Mobile Radio Services operating under parts 90 and 95 of the
Commission's
[[Page 16683]]
rules. Services in this category provide one- or two-way communications
between vehicles, persons or fixed stations on a shared basis and
include radiolocation services, industrial radio services, and land
transportation radio services. For FY 1999, licensees of services in
this category will pay a $7 annual regulatory fee per call sign,
payable for an entire five-year license term at the time of application
for a new, renewal, or reinstatement license. The total regulatory fee
due is $35 for the five-year license term.
10. Aviation (Aircraft) Service: These services include stations
authorized to provide communications between aircraft and between
aircraft and ground stations and include frequencies used to
communicate with air traffic control facilities pursuant to part 87 of
the Commission's rules. The Telecommunications Act of 1996 gave the
Commission the authority to license certain aircraft radio stations by
rule rather than by individual license. The commission exercises that
authority. Thus, private aircraft operators flying entirely within
domestic U.S. airspace and who are not otherwise required by treaty or
agreement to carry a radio are no longer required to hold an aircraft
license, and they will not be required to pay a regulatory fee. For FY
1999, parties required to be licensed and those choosing to be licensed
for Aviation (Aircraft) Stations will pay a $7 annual regulatory fee
per station, payable for the entire ten-year license term at the time
of application for a new, renewal, or reinstatement license. The total
regulatory fee due is $70 per station for the ten-year license term.
11. Aviation (Ground) Service: This service includes stations
authorized to provide ground-based communications to aircraft for
weather or landing information, or for logistical support pursuant to
part 87 of the Commission's rules. Certain ground-based stations which
only serve itinerant traffic, i.e., possess no actual units on which to
assess a fee, are exempt from payment of regulatory fees. For FY 1999,
licensees of Aviation (Ground) Stations will pay a $7 annual regulatory
fee per license, payable for the entire five-year license term at the
time of application for a new, renewal, or reinstatement license. The
total regulatory fee is $35 per call sign for the five-year license
term.
12. General Mobile Radio Service (GMRS): These services include
Land Mobile Radio licensees providing personal and limited business
communications between vehicles or to fixed stations for short-range,
two-way communications pursuant to part 95 of the Commission's rules.
For FY 1999, GMRS licensees will pay a $7 annual regulatory fee per
license, payable for an entire five-year license term at the time of
application for a new, renewal or reinstatement license. The total
regulatory fee due is $35 per license for the five-year license term.
c. Amateur Radio Vanity Call Signs
13. Amateur Vanity Call Signs: This category covers voluntary
requests for specific call signs in the Amateur Radio Service
authorized under part 97 of the Commission's rules. Applicants for
Amateur Vanity Call-Signs will continue to pay a $1.30 annual
regulatory fee per call sign, as prescribed in the FY 1998 fee
schedule, payable for an entire ten-year license term at the time of
application for a vanity call sign until the FY 1999 fee schedule
becomes effective. The total regulatory fee due would be $13 per
license for the ten-year license term.160 For FY 1999,
Amateur Vanity Call Sign applicants will pay a $1.42 annual regulatory
fee per call sign, payable for an entire ten-year term at the time of
application for a new, renewal or reinstatement license. The total
regulatory fee due is $14.20 per call sign for the ten-year license
term. We propose that there will be no refunds to applicants who submit
applications before implementation of the FY 1999 fee.
---------------------------------------------------------------------------
\160\ Section 9(h) exempts ``amateur radio operator licenses
under part 97 of the Commission's rules (47 CFR part 97)'' from the
requirement. However, section 9(g)'s fee schedule explicitly
includes ``Amateur vanity call signs'' as a category subject to the
payment of a regulatory fee.
---------------------------------------------------------------------------
d. Commercial Wireless Radio Services
14. Commercial Mobile Radio Services (CMRS) Mobile Services: The
Commercial Mobile Radio Service (CMRS) is an ``umbrella'' descriptive
term attributed to various existing broadband services authorized to
provide interconnected mobile radio services for profit to the public,
or to such classes of eligible users as to be effectively available to
a substantial portion of the public. CMRS Mobile Services include
certain licensees which formerly were licensed as part of the Private
Radio Services (e.g., Specialized Mobile Radio Services) and others
formerly licensed as part of the Common Carrier Radio Services (e.g.,
Public Mobile Services and Cellular Radio Service). While specific
rules pertaining to each covered service remain in separate parts 22,
24, 27, 80 and 90, general rules for CMRS are contained in part 20.
CMRS Mobile Services will include: Specialized Mobile Radio Services
(part 90);161 Broadband Personal Communications Services
(part 24), Public Coast Stations (part 80); Public Mobile Radio
(Cellular, 800 MHz Air-Ground Radiotelephone, and Offshore Radio
Services) (part 22); and Wireless Communications Service (part 27).
Each licensee in this group will pay an annual regulatory fee for each
mobile or cellular unit (mobile or telephone number), assigned to its
customers, including resellers of its services. For FY 1999, the
regulatory fee is $.32 per unit.
---------------------------------------------------------------------------
\161\ This category does not include licensees of private
shared-use 220 MHz and 470 MHz and above in the Specialized Mobile
Radio (SMR) service who have elected to remain non-commercial. Those
who have elected not to change to the Commercial Mobile Radio
Service (CMRS) are referred to paragraph 4 of this Attachment.
---------------------------------------------------------------------------
15. Commercial Mobile Radio Services (CMRS) Messaging Services: The
Commercial Mobile Radio Service (CMRS) is an ``umbrella'' descriptive
term attributed to various existing narrowband services authorized to
provide interconnected mobile radio services for profit to the public,
or to such classes of eligible users as to be effectively available to
a substantial portion of the public. CMRS Messaging Services include
certain licensees which formerly were licensed as part of the Private
Radio Services (e.g., Private Paging and Radiotelephone Service),
licensees formerly licensed as part of the Common Carrier Radio
Services (e.g., Public Mobile One-Way Paging), licensees of Narrowband
Personal Communications Service (PCS) (e.g., one-way and two-way
paging), and 220-222 MHz Band and Interconnected Business Radio
Service. While specific rules pertaining to each covered service remain
in separate parts 22, 24 and 90, general rules for CMRS are contained
in part 20. Each licensee in the CMRS Messaging Services will pay an
annual regulatory fee for each unit (pager, telephone number, or
mobile) assigned to its customers, including resellers of its services.
For FY 1999, the regulatory fee is $.04 per unit.
16. Finally, we are reiterating our definition of CMRS payment
units to make it clear that fees are assessable on each PCS or cellular
telephone and each one-way or two-way pager capable of receiving or
transmitting information, whether or not the unit is ``active'' on the
``as-of'' date for payment of these fees. The unit becomes ``feeable''
if the end user or assignee of the unit has possession of the unit and
the unit is capable of transmitting or receiving voice or non-voice
messages or data and the unit is either owned and operated by the
licensee of the CMRS system or a
[[Page 16684]]
reseller, or the end user of a unit has a contractual agreement for the
provision of a CMRS service from a licensee of a CMRS system or a
reseller of a CMRS service. The responsible payer of the regulatory fee
is the CMRS licensee. For example, John Doe purchases a pager and
contractually obtains paging services from Paging Licensee X. Paging
Licensee X is responsible for paying the applicable regulatory fee for
this unit. Likewise, Cellular Licensee Y donates cellular phones to a
high school and the high school either pays for or obtains free
cellular service from Cellular Licensee Y. In this situation, Cellular
Licensee Y is responsible for paying the applicable regulatory fees for
these units.
2. Mass Media Services
17. The regulatory fees for the Mass Media fee category apply to
broadcast licensees and permittees. Noncommercial Educational
Broadcasters are exempt from regulatory fees.
a. Commercial Radio
18. These categories include licensed Commercial AM (Classes A, B,
C, and D) and FM (Classes A, B, B1, C, C1, C2, and C3) Radio Stations
operating under part 73 of the Commission's rules.162 We
have combined class of station and city grade contour population data
to formulate a schedule of radio fees which differentiate between
stations based on class of station and population served. In general,
higher class stations and stations in metropolitan areas will pay
higher fees than lower class stations and stations located in rural
areas. The specific fee that a station must pay is determined by where
it ranks after weighting its fee requirement (determined by class of
station) with its population. The regulatory fee classifications for
Radio Stations for FY 1999 are as follows:
---------------------------------------------------------------------------
\162\ The Commission acknowledges that certain stations
operating in Puerto Rico and Guam have been assigned a higher level
station class than would be expected if the station were located on
the mainland. Although this results in a higher regulatory fee, we
believe that the increased interference protection associated with
the higher station class is necessary and justifies the fee.
FY 1999 Radio Station Regulatory Fees
--------------------------------------------------------------------------------------------------------------------------------------------------------
FM Classes A, FM Classes B,
Population served AM Class A AM Class B AM Class C AM Class D B1 & C3 C, C1 & C2
--------------------------------------------------------------------------------------------------------------------------------------------------------
<20,000................................................. 430 325 225 275 325 430
20,001-50,000........................................... 825 650 325 450 650 825
50,001-125,000.......................................... 1,350 875 450 675 875 1,350
125,001-400,000......................................... 2,000 1,400 675 825 1,400 2,000
400,001-1,000,000....................................... 2,750 2,250 1,250 1,500 2,250 2,750
>1,000,000.............................................. 4,400 3,600 1,750 2,250 3,600 4,400
--------------------------------------------------------------------------------------------------------------------------------------------------------
19. Licensees may determine the appropriate fee payment by
referring to a list which will be provided as an attachment to the
final Report and Order in this proceeding. This same information will
be available on the FCC's internet world wide web site (http://
www.fcc.gov) by calling the FCC's National Call Center (1-888-225-
5322), and may be included in the Public Notices mailed to each
licensee for which we have a current address on file (Note: Non-receipt
of a Public Notice does not relieve a licensee of its obligation to
submit its regulatory fee payment).
b. Construction Permits--Commercial AM Radio
20. This category includes holders of permits to construct new
Commercial AM Stations. For FY 1999, permittees will pay a fee of $255
for each permit held. Upon issuance of an operating license, this fee
would no longer be applicable and licensees would be required to pay
the applicable fee for the designated group within which the station
appears.
c. Construction Permits--Commercial FM Radio
21. This category includes holders of permits to construct new
Commercial FM Stations. For FY 1999, permittees will pay a fee of
$1,250 for each permit held. Upon issuance of an operating license,
this fee would no longer be applicable. Instead, licensees would pay a
regulatory fee based upon the designated group within which the station
appears.
d. Commercial Television Stations
22. This category includes licensed Commercial VHF and UHF
Television Stations covered under part 73 of the Commission's rules,
except commonly owned Television Satellite Stations, addressed
separately below. Markets are Nielsen Designated Market Areas (DMA) as
listed in the Television & Cable Factbook, Stations Volume No. 67, 1999
Edition, Warren Publishing, Inc. The fees for each category of station
are as follows:
VHF Markets 1-10--$41,125
VHF Markets 11-25--$34,225
VHF Markets 26-50--$23,425
VHF Markets 51-100--$13,100
VHF Remaining Markets--$3,400
UHF Markets 1-10--$15,500
UHF Markets 11-25--$11,725
UHF Markets 26-50--$7,275
UHF Markets 51-100--$4,350
UHF Remaining Markets--$1,175
e. Commercial Television Satellite Stations
23. Commonly owned Television Satellite Stations in any market
(authorized pursuant to Note 5 of Sec. 73.3555 of the Commission's
rules) that retransmit programming of the primary station are assessed
a fee of $1,275 annually. Those stations designated as Television
Satellite Stations in the 1999 Edition of the Television and Cable
Factbook are subject to the fee applicable to Television Satellite
Stations. All other television licensees are subject to the regulatory
fee payment required for their class of station and market.
f. Construction Permits--Commercial VHF Television Stations
24. This category includes holders of permits to construct new
Commercial VHF Television Stations. For FY 1999, VHF permittees will
pay an annual regulatory fee of $2,775. Upon issuance of an operating
license, this fee would no longer be applicable. Instead, licensees
would pay a fee based upon the designated market of the station.
g. Construction Permits--Commercial UHF Television Stations
25. This category includes holders of permits to construct new UHF
Television Stations. For FY 1999, UHF Television permittees will pay an
annual regulatory fee of $2,900. Upon issuance of an operating license,
this fee would no longer be applicable. Instead,
[[Page 16685]]
licensees would pay a fee based upon the designated market of the
station.
h. Construction Permits--Satellite Television Stations
26. The fee for UHF and VHF Television Satellite Station
construction permits for FY 1999 is $460. An individual regulatory fee
payment is to be made for each Television Satellite Station
construction permit held.
i. Low Power Television, FM Translator and Booster Stations, TV
Translator and Booster Stations
27. This category includes Low Power UHF/VHF Television stations
operating under part 74 of the Commission's rules with a transmitter
power output limited to 1 kW for a UHF facility and, generally, 0.01 kW
for a VHF facility. Low Power Television (LPTV) stations may retransmit
the programs and signals of a TV Broadcast Station, originate
programming, and/or operate as a subscription service. This category
also includes translators and boosters operating under part 74 which
rebroadcast the signals of full service stations on a frequency
different from the parent station (translators) or on the same
frequency (boosters). The stations in this category are secondary to
full service stations in terms of frequency priority. We have also
received requests for waivers of the regulatory fees from operators of
community based Translators. These Translators are generally not
affiliated with commercial broadcasters, are nonprofit, nonprofitable,
or only marginally profitable, serve small rural communities, and are
supported financially by the residents of the communities served. We
are aware of the difficulties these Translators have in paying even
minimal regulatory fees, and we have addressed those concerns in the
ruling on reconsideration of the FY 1994 Report and Order. Community
based Translators are exempt from regulatory fees. For FY 1999,
licensees in low power television, FM translator and booster, and TV
translator and booster category will pay a regulatory fee of $290 for
each license held.
j. Broadcast Auxiliary Stations
28. This category includes licensees of remote pickup stations
(either base or mobile) and associated accessory equipment authorized
pursuant to a single license, Aural Broadcast Auxiliary Stations
(Studio Transmitter Link and Inter-City Relay) and Television Broadcast
Auxiliary Stations (TV Pickup, TV Studio Transmitter Link, TV Relay)
authorized under part 74 of the Commission's Rules. Auxiliary Stations
are generally associated with a particular television or radio
broadcast station or cable television system. This category does not
include translators and boosters (see paragraph 26 infra). For FY 1999,
licensees of Commercial Auxiliary Stations will pay a $12 annual
regulatory fee on a per call sign basis.
k. Multipoint Distribution Service
29. This category includes Multipoint Distribution Service (MDS),
Local Multipoint Distribution (LMDS), and Multichannel Multipoint
Distribution Service (MMDS), authorized under part 21 of the
Commission's Rules to use microwave frequencies for video and data
distribution within the United States. For FY 1999, MDS, LMDS, and MMDS
stations will pay an annual regulatory fee of $285 per call sign.
3. Cable Services
a. Cable Television Systems
30. This category includes operators of Cable Television Systems,
providing or distributing programming or other services to subscribers
under part 76 of the Commission's Rules. For FY 1999, Cable Systems
will pay a regulatory fee of $.48 per subscriber.163
Payments for Cable Systems are to be made on a per subscriber basis as
of December 31, 1998. Cable Systems should determine their subscriber
numbers by calculating the number of single family dwellings, the
number of individual households in multiple dwelling units, e.g.,
apartments, condominiums, mobile home parks, etc., paying at the basic
subscriber rate, the number of bulk rate customers and the number of
courtesy or fee customers. In order to determine the number of bulk
rate subscribers, a system should divide its bulk rate charge by the
annual subscription rate for individual households. See FY 1994 Report
and Order, 59 FR 30984 (January 16, 1994).
---------------------------------------------------------------------------
\163\ Cable systems are to pay their regulatory fees on a per
subscriber basis rather than per 1,000 subscribers as set forth in
the statutory fee schedule. See FY 1994 Report and Order at
paragraph 100.
---------------------------------------------------------------------------
b. Cable Antenna Relay Service
31. This category includes Cable Antenna Relay Service (CARS)
stations used to transmit television and related audio signals, signals
of AM and FM Broadcast Stations, and cablecasting from the point of
reception to a terminal point from where the signals are distributed to
the public by a Cable Television System. For FY 1999, licensees will
pay an annual regulatory fee of $55 per CARS license.
4. Common Carrier Services
a. Commercial Microwave (Domestic Public Fixed Radio Service)
32. This category includes licensees in the Point-to-Point
Microwave Radio Service, Local Television Transmission Radio Service,
and Digital Electronic Message Service, authorized under part 101 of
the Commission's rules to use microwave frequencies for video and data
distribution within the United States. These services are now included
in the Microwave category (see paragraph 5 infra).
b. Interstate Telephone Service Providers
33. This category includes Inter-Exchange Carriers (IXCs), Local
Exchange Carriers (LECs), Competitive Access Providers (CAPs), domestic
and international carriers that provide operator services, Wide Area
Telephone Service (WATS), 800, 900, telex, telegraph, video, other
switched, interstate access, special access, and alternative access
services either by using their own facilities or by reselling
facilities and services of other carriers or telephone carrier holding
companies, and companies other than traditional local telephone
companies that provide interstate access services to long distance
carriers and other customers. This category also includes pre-paid
calling card providers. These common carriers, including resellers,
must submit fee payments based upon their proportionate share of gross
interstate revenues using the methodology that we have adopted for
calculating contributions to the TRS fund.164 In order to
avoid imposing any double payment burden on resellers, we will permit
carriers to subtract from their gross interstate revenues, as reported
to NECA in connection with their TRS contribution, any payments made to
underlying common carriers for telecommunications facilities and
services, including payments for interstate access service, that are
sold in the form of interstate service. For this purpose, resold
telecommunications facilities and services are only intended to include
payments that correspond to revenues that will be included by another
carrier reporting interstate revenue. For FY 1999, carriers must
multiply their adjusted gross revenue figure (gross revenue reduced by
the total amount of their payments to underlying common carriers for
telecommunications facilities or services) by the factor 0.0012 to
[[Page 16686]]
determine the appropriate fee for this category of service. Regulatees
may want to use the following worksheet to determine their fee payment:
---------------------------------------------------------------------------
\164\ See Telecommunications Relay Services, 8 FCC Rcd 5300
(1993), 58 FR 39671 (Jul. 26, 1993).
------------------------------------------------------------------------
Total Interstate
------------------------------------------------------------------------
(1) Revenue reported in TRS Fund ........... ................
worksheets..............................
(2) Less: Access charges paid............ ........... ................
(3) Less: Other telecommunications ........... ................
facilities and services taken for resale
(4) Adjusted revenues (1)minus(2)minus(3) ........... ................
(5) Fee factor........................... ........... 0.0012
(6) Fee due (4)times(5).................. ........... ................
------------------------------------------------------------------------
5. International Services
a. Earth Stations
34. Very Small Aperture Terminal (VSAT) Earth Stations, equivalent
C-Band Earth Stations and antennas, and earth station systems comprised
of very small aperture terminals operate in the 12 and 14 GHz bands and
provide a variety of communications services to other stations in the
network. VSAT systems consist of a network of technically-identical
small Fixed-Satellite Earth Stations which often include a larger hub
station. VSAT Earth Stations and C-Band Equivalent Earth Stations are
authorized pursuant to part 25 of the Commission's rules. Mobile
Satellite Earth Stations, operating pursuant to part 25 of the
Commission's rules under blanket licenses for mobile antennas
(transceivers), are smaller than one meter and provide voice or data
communications, including position location information for mobile
platforms such as cars, buses, or trucks.165 Fixed-Satellite
Transmit/Receive and Transmit-Only Earth Station antennas, authorized
or registered under part 25 of the Commission's rules, are operated by
private and public carriers to provide telephone, television, data, and
other forms of communications. Included in this category are telemetry,
tracking and control (TT&C) earth stations, and earth station uplinks.
For FY 1999, licensees of VSATs, Mobile Satellite Earth Stations, and
Fixed-Satellite Transmit/Receive and Transmit-Only Earth Stations will
pay a fee of $180 per authorization or registration as well as a
separate fee of $180 for each associated Hub Station.
---------------------------------------------------------------------------
\165\ Mobile earth stations are hand-held or vehicle-based units
capable of operation while the operator or vehicle is in motion. In
contrast, transportable units are moved to a fixed location and
operate in a stationary (fixed) mode. Both are assessed the same
regulatory fee for FY 1999.
---------------------------------------------------------------------------
35. Receive-only earth stations. For FY 1999, there is no
regulatory fee for receive-only earth stations.
b. Space Stations (Geostationary Orbit)
36. Geostationary Orbit (also referred to as Geosynchronous) Space
Stations are domestic and international satellites positioned in orbit
to remain approximately fixed relative to the earth. Most are
authorized under part 25 of the Commission's rules to provide
communications between satellites and earth stations on a common
carrier and/or private carrier basis. In addition, this category
includes Direct Broadcast Satellite (DBS) Service which includes space
stations authorized under part 100 of the Commission's rules to
transmit or re-transmit signals for direct reception by the general
public encompassing both individual and community reception. For FY
1999, entities authorized to operate geostationary space stations
(including DBS satellites) will be assessed an annual regulatory fee of
$130,225 per operational station in orbit. Payment is required for any
geostationary satellite that has been launched and tested and is
authorized to provide service.
c. Space Stations (Non-Geostationary Orbit)
37. Non-Geostationary Orbit Systems (such as Low Earth Orbit (LEO)
Systems) are space stations that orbit the earth in non-geosynchronous
orbit. They are authorized under part 25 of the Commission's rules to
provide communications between satellites and earth stations on a
common carrier and/or private carrier basis. For FY 1999, entities
authorized to operate Non-Geostationary Orbit Systems (NGSOs) will be
assessed an annual regulatory fee of $180,325 per operational system in
orbit. Payment is required for any NGSO System that has one or more
operational satellites operational. In our FY 1997 Report and Order at
paragraph 75 we retained our requirement that licensees of LEOs pay the
LEO regulatory fee upon their certification of operation of a single
satellite pursuant to section 25.120(d). We require payment of this fee
following commencement of operations of a system's first satellite to
insure that we recover our regulatory costs related to LEO systems from
licensees of these systems as early as possible so that other
regulatees are not burdened with these costs any longer than necessary.
Because section 25.120(d) has significant implications beyond
regulatory fees (such as whether the entire planned cluster is
operational in accordance with the terms and conditions of the license)
we are clarifying our current definition of an operational LEO
satellite to prevent misinterpretation of our intent as follows:
Licensees of Non-Geostationary Satellite Systems (such as LEOs)
are assessed a regulatory fee upon the commencement of operation of
a system's first satellite as reported annually pursuant to sections
25.142(c), 25.143(e), 25.145(g), or upon certification of operation
of a single satellite pursuant to section 25.120(d).
d. International Bearer Circuits
38. Regulatory fees for International Bearer Circuits are to be
paid by facilities-based common carriers (either domestic or
international) activating the circuit in any transmission facility for
the provision of service to an end user or resale carrier. Payment of
the fee for bearer circuits by non-common carrier submarine cable
operators is required for circuits sold on an indefeasible right of use
(IRU) basis or leased to any customer, including themselves or their
affiliates, other than an international common carrier authorized by
the Commission to provide U.S. international common carrier services.
Compare FY 1994 Report and Order at 5367. Payment of the international
bearer circuit fee is also required by non-common carrier satellite
operators for circuits sold or leased to any customer, including
themselves or their affiliates, other than an international common
carrier authorized by the Commission to provide U.S. international
common carrier services. The fee is based upon active 64 kbps circuits,
or equivalent circuits. Under this formulation, 64 kbps circuits or
their equivalent will be assessed a fee. Equivalent circuits include
the 64 kbps circuit equivalent of larger bit stream
[[Page 16687]]
circuits. For example, the 64 kbps circuit equivalent of a 2.048 Mbps
circuit is 30 64 kbps circuits. Analog circuits such as 3 and 4 kHz
circuits used for international service are also included as 64 kbps
circuits. However, circuits derived from 64 kbps circuits by the use of
digital circuit multiplication systems are not equivalent 64 kbps
circuits. Such circuits are not subject to fees. Only the 64 kbps
circuit from which they have been derived will be subject to payment of
a fee. For FY 1999, the regulatory fee is $7.00 for each active 64 kbps
circuit or equivalent. For analog television channels we will assess
fees as follows:
------------------------------------------------------------------------
No. of
Analog television channel Size in MHz equivalent 64
kbps circuits
------------------------------------------------------------------------
36...................................................... 630
24...................................................... 288
18...................................................... 240
------------------------------------------------------------------------
e. International Public Fixed
39. This fee category includes common carriers authorized under
part 23 of the Commission's rules to provide radio communications
between the United States and a foreign point via microwave or HF
troposcatter systems, other than satellites and satellite earth
stations, but not including service between the United States and
Mexico and the United States and Canada using frequencies above 72 MHz.
For FY 1999, International Public Fixed Radio Service licensees will
pay a $410 annual regulatory fee per call sign.
f. International (HF) Broadcast
40. This category covers International Broadcast Stations licensed
under part 73 of the Commission's rules to operate on frequencies in
the 5,950 kHz to 26,100 kHz range to provide service to the general
public in foreign countries. For FY 1999, International HF Broadcast
Stations will pay an annual regulatory fee of $520 per station license.
Authorization of Service: The authorization or licensing of radio
stations, telecommunications equipment, and radio operators, as well as
the authorization of common carrier and other services and facilities.
Includes policy direction, program development, legal services, and
executive direction, as well as support services associated with
authorization activities.166
---------------------------------------------------------------------------
\166\ Although Authorization of Service is described in this
exhibit, it is not one of the activities included as a feeable
activity for regulatory fee purposes pursuant to section 9(a)(1) of
the Act. 47 U.S.C. 159(a)(1).
---------------------------------------------------------------------------
Policy and Rulemaking: Formal inquiries, rulemaking proceedings to
establish or amend the Commission's rules and regulations, action on
petitions for rulemaking, and requests for rule interpretations or
waivers; economic studies and analyses; spectrum planning, modeling,
propagation-interference analyses, and allocation; and development of
equipment standards. Includes policy direction, program development,
legal services, and executive direction, as well as support services
associated with policy and rulemaking activities.
Enforcement: Enforcement of the Commission's rules, regulations and
authorizations, including investigations, inspections, compliance
monitoring, and sanctions of all types. Also includes the receipt and
disposition of formal and informal complaints regarding common carrier
rates and services, the review and acceptance/rejection of carrier
tariffs, and the review, prescription and audit of carrier accounting
practices. Includes policy direction, program development, legal
services, and executive direction, as well as support services
associated with enforcement activities.
Public Information Services: The publication and dissemination of
Commission decisions and actions, and related activities; public
reference and library services; the duplication and dissemination of
Commission records and databases; the receipt and disposition of public
inquiries; consumer, small business, and public assistance; and public
affairs and media relations. Includes policy direction, program
development, legal services, and executive direction, as well as
support services associated with public information activities.
Attachment H--Factors, measurements and calculations that go into
determining station signal contours and associated population
coverages
AM Stations: Specific information on each day tower, including
field ratio, phasing, spacing and orientation was retrieved, as well as
the theoretical pattern RMS figure (mV/m @ 1 km) for the antenna
system. The standard, or modified standard if pertinent, horizontal
plane radiation pattern was calculated using techniques and methods
specified in sections 73.150 and 73.152 of the Commission's
rules.167 Radiation values were calculated for each of 72
radials around the transmitter site (every 5 degrees of azimuth). Next,
estimated soil conductivity data was retrieved from a database
representing the information in FCC Figure M3. Using the calculated
horizontal radiation values, and the retrieved soil conductivity data,
the distance to the city grade (5 mV/m) contour was predicted for each
of the 72 radials. The resulting distance to city grade contours were
used to form a geographical polygon. Population counting was
accomplished by determining which 1990 block centroids were contained
in the polygon. The sum of the population figures for all enclosed
blocks represents the total population for the predicted city grade
coverage area.
---------------------------------------------------------------------------
\167\ 47 U.S.C. 73.150 and 73.152.
---------------------------------------------------------------------------
FM Stations: The maximum of the horizontal and vertical HAAT (m)
and ERP (kW) was used. Where the antenna HAMSL was available, it was
used in lieu of the overall HAAT figure to calculate specific HAAT
figures for each of 72 radials under study. Any available directional
pattern information was applied as well, to produce a radial-specific
ERP figure. The HAAT and ERP figures were used in conjunction with the
propagation curves specified in section 73.313 of the Commission's
rules to predict the distance to the city grade (70 dBuV/m or 3.17 mV/
m) contour for each of the 72 radials.168 The resulting
distance to city grade contours were used to form a geographical
polygon. Population counting was accomplished by determining which 1990
block centroids were contained in the polygon. The sum of the
population figures for all enclosed blocks represents the total
population for the predicted city grade coverage area.
\168\ 47 U.S.C. 73.313.
---------------------------------------------------------------------------
[FR Doc. 99-8342 Filed 4-5-99; 8:45 am]
BILLING CODE 6712-01-P