[Federal Register Volume 64, Number 126 (Thursday, July 1, 1999)]
[Rules and Regulations]
[Pages 35832-35861]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-16584]



[[Page 35831]]

_______________________________________________________________________

Part IV





Federal Communications Commission





_______________________________________________________________________



47 CFR Part 1



Assessment and Collection of Regulatory Fees for Fiscal Year 1999; 
Final Rule

  Federal Register / Vol. 64, No. 126 / Thursday, July 1, 1999 / Rules 
and Regulations  

[[Page 35832]]



FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 1

[MD Docket No. 98-200; FCC 99-146]


Assessment and Collection of Regulatory Fees for Fiscal Year 1999

AGENCY: Federal Communications Commission.

ACTION: Final rule.

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SUMMARY: The Commission has revised 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.

EFFECTIVE DATE: September 10, 1999.

FOR FURTHER INFORMATION CONTACT: Terry Johnson, Office of Managing 
Director at (202) 418-0445 or Roland Helvajian, Office of Managing 
Director at (202) 418-0444.

SUPPLEMENTARY INFORMATION:
Adopted: June 11, 1999; Released: June 18, 1999

    By the Commission.

                            Table of Contents
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                                                             Paragraph
                          Topic                                Nos.
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I. Introduction.........................................               1
II. Background..........................................               4
III. Discussion:........................................
    A. Summary of FY 1999 Fee Methodology...............               8
    B. Development of FY 1999 Fees
        i. Adjustment of Payment Units..................              13
        ii. Calculation of Revenue Requirements.........              14
        iii. Recalculation of Fees......................              15
    C. Changes to Fee Schedule..........................              16
        i. FY 1999 Fee Schedule Based on Mandatory                    17
         Adjustments....................................
        ii. Reduction of the FM Construction Permit Fee.              18
        iii. Redesignation of Small SMR Systems as CMRS               20
         Messaging......................................
        iv. Other Comments Regarding Adjustments to CMRS              22
        v. Re-Activation of Interactive Video Data                    27
         Services Fee (now 218-219 MHz Service).........
    D. Other Issues Raised by Commenters................              28
        i. Interstate Telephone Service Providers.......              30
        ii. New Services Fee Category...................              33
        iii. COMSAT and Non-U.S. Licensees..............              36
        iv. Non-Common Carrier Bearer Circuits..........              40
        v. GSO Space Stations...........................              42
        vi. NGSO Space Stations.........................              45
        vii. Commercial Radio and Television............              47
        viii. Fee Filing Software.......................              51
    E. Procedures for Payment of Regulatory Fees........              54
        i. Annual Payments of Standard Fees.............              55
        ii. Installment Payments for Large Fees.........              56
        iii. Advance Payments of Small Fees.............              57
        iv. Minimum Fee Payment Liability...............              58
        v. Standard Fee Calculations and Payments.......              59
        vi. Improved Fee Collection Systems.............              61
        vii. Late or Insufficient Regulatory Fee Payment              62
    F. Schedule of FY 1999 Regulatory Fees..............              63
IV. Procedural Matters:
    A. Ordering Clause..................................              64
    B. Authority and Further Information................              65
Attachment A--Final 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, FY 1999
 Proposed, and FY 1999 Final 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
Attachment I--Parties Filing Comments and Reply Comments
Attachment J--AM and FM Radio Regulatory Fees
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I. Introduction

    1. By this Report and Order, the Commission concludes a proceeding 
to revise its Schedule of Regulatory Fees in order to collect the 
amount of regulatory fees that Congress has required it to collect for 
Fiscal Year (FY) 1999.1
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    \1\ Assessment and Collection of Regulatory Fees for Fiscal Year 
1999, FCC 98-298, released December 4, 1998, 63 FR 70090 (Dec. 18, 
1998) (NOI), and FCC 99-44, released March 24, 1999, 64 FR 16661 
(Apr. 6, 1999) (NPRM).

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[[Page 35833]]

    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 revising our fees 
in order to collect the increased amount that Congress has required for 
us to collect. Additionally, we are amending the Schedule in order to 
simplify and streamline it.4
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    \2\ Pub. L. 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).
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    3. In revising 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 making changes to the fees 
pursuant to public interest considerations. The current Schedule of 
Regulatory Fees is set forth in Secs. 1.1152 through 1.1156 of the 
Commission's rules.5
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    \5\ 47 CFR 1.1152 through 1.1156.
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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
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    \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.
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    5. As noted above, 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
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    \10\ 47 U.S.C. 159(b)(2), (b)(3).
    \11\ 47 U.S.C. 159(b)(2).
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    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
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    \12\ 47 U.S.C. 159(b)(3).
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    7. Section 9(i) requires that we develop accounting systems 
necessary to adjust our fees pursuant to subsection b(3), 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, so that we can 
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 these 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
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    \13\ 47 U.S.C. 159(i).
    \14\ 47 U.S.C. 159(b)(4)(B).
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III. Discussion

A. Summary of FY 1999 Fee Methodology

    8. As noted above, 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 This fact is the overriding principle that 
determines how the fee schedule is adjusted. Notwithstanding any 
considerations of benefit to the fee payer, it is a zero-sum mandate in 
which any adjustment downward must be met with a corresponding 
adjustment upward for all others to ensure collection of the aggregate 
amount mandated by Congress in its appropriation Act.
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    \15\ 47 U.S.C. 159(a).
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    9. In developing our 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 
previous fiscal years. As required by section 9(b)(2), 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.
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    \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.
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    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. However, as 
stated in paragraph 8, any permitted amendment made affects all other 
feeable categories to ensure the total amount required will still be 
collected. These proposals are discussed in paragraphs 16-31 and are 
factored into our FY 1999 Schedule of Regulatory Fees, set forth in 
Attachment D.
    11. It should be further noted that the requirement to derive fees 
based on the number of full-time equivalent number of employees is 
superseded by the cost accounting system developed pursuant to section 
9(i) which is combined with the payroll and benefits system to 
incorporate that information. Non-employee contractual activities are 
not charged to feeable activities directly, but are factored into 
overhead. Also, the primary purpose of the cost accounting system is to 
support the making of permitted amendments, and it is not required to 
be used in developing the fee schedule.
    12. Finally, we have incorporated, as Attachment F, proposed 
Guidance containing detailed descriptions of each fee category, 
information on the individual or entity responsible for

[[Page 35834]]

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. In the following paragraphs, we 
describe in greater detail our methodology for establishing our FY 1999 
regulatory fees.

B. Development of FY 1999 Fees

i. Adjustment of Payment Units
    13. 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.17
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    \17\ 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.
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ii. Calculation of Revenue Requirements
    14. 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 provides detailed 
calculations showing how we determined the revised revenue amounts to 
be raised for each service.
iii. Recalculation of Fees
    15. Once we determined the amount of fee revenue that 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.

C. Changes to Fee Schedule

    16. 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).18 As a result of this 
review, we are making the following ``Permitted Amendments'' to our Fee 
Schedule:
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    \18\ In FY 1997 and FY 1998 we limited increases to 25%. For FY 
1999, none of the proposed fee increases exceed 25%.
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i. FY 1999 Fee Schedule Based on Mandatory Adjustments
    17. The FY 1999 fee schedule is based on the ``Mandatory 
Adjustments'' as computed in Attachment C and in accordance with 
section 9(b)(2) of the Act. After the Notice of Proposed Rulemaking 
(Assessment and Collection of Regulatory Fees for Fiscal Year 1999, FCC 
99-44, released March 24, 1999, 64 FR 16661 (Apr. 6, 1999) was issued, 
the staff determined that its original estimates of the number of 
payment units for Marine (Ship) should be reduced from 16,800 to 7,100 
to reflect a reduction in renewal applications caused by the transition 
from five-year to ten-year license terms. Likewise, the number of 
payment units for Aviation (Aircraft) is being reduced from 4,800 to 
4,500.
ii. Reduction of the FM Construction Permit Fee
    18. 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 years' 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 $260). While the Commission's regulatory 
costs in processing FM Construction Permit fees are higher than its 
costs for AM Construction Permit fees, several parties have expressed 
concern that the FM Construction Permit fee is nevertheless 
disproportionately high particularly in less populated areas.
    19. In the Notice of Proposed Rulemaking (NPRM), we sought 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 
three times the AM Construction Permit fee. The Commission did not 
receive comments on the proposal to reduce the FM Construction Permit 
regulatory fee, and is adopting the proposal herein.
iii. Redesignation of Small SMR Systems as CMRS Messaging
    20. In the NOI,19 we solicited comment on whether the 
Commercial Mobile Radio Services (``CMRS'') fee categories should be 
revised to reflect types of service or usage. In FY 1998, the 
demarcation of fee categories was based on the authorized bandwidth, 
rather than the nature of the service offered. CMRS licensees 
authorized to operate on broadband spectrum were classified within the 
CMRS Mobile Services fee category, while CMRS licensees authorized to 
operate on narrowband spectrum were classified within the CMRS 
Messaging fee category. In this context, several parties, including 
BellSouth Wireless Data, the Paging Network (``PageNet''), and ARDIS 
Company (Ardis) urge the Commission to reclassify the 900 MHz 
Specialized Mobile Radio Service (``SMR'') systems for regulatory fee 
purposes. Specifically, the commenters assert that SMR systems used for 
mobile data services are similar to and compete with CMRS messaging 
services, and accordingly, should be classified as such for section 9 
purposes. The Council of Independent Communications Suppliers 
(``CICS'') and the American Mobile Telecommunications Association, Inc. 
(``AMTA'') further maintain that all ``traditional'' SMR are similarly 
situated to messaging services in terms of the limited amount of 
spectrum utilized and the limited nature of the services offered, and 
thus recommend the reclassification of all traditional SMR services.
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    \19\ See FY 1999 NOI at paragraph 9.
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    21. We are persuaded by the comments that the SMR service is 
similar to the CMRS Messaging service, that the SMR service should be 
accorded similar treatment with respect to regulatory fee requirements, 
and thus that reclassification is warranted. Accordingly, we are 
revising our designation of services contained in the CMRS Messaging 
fee category. For FY 1999, the CMRS Messaging fee category will also 
include all SMR systems authorized for operation with less than 10 MHz 
bandwidth.

[[Page 35835]]

iv. Other Comments Regarding Adjustments to CMRS
    22. In the NOI,20 we specifically asked commenters to 
provide proposals to establish models, or direct us to available 
sources of data, that estimate the number of payment units (number of 
subscribers) in the CMRS service to enable us to calculate fees that 
more accurately reflect the regulatory costs associated with this 
service. The Cellular Telecommunications Industry Association (CTIA) 
takes issue with the Commission's methodology and projections. CTIA 
argues that section 9(i) of the Communications Act of 1934 (``Act''), 
as amended, ``requires that [the Commission] develop accounting systems 
necessary to adjust [its] fees pursuant to changes in the costs of 
regulation of various services that are subject to a fee.'' 
21 Instead, they argue further, the Commission has adopted a 
more complicated, and ultimately unreliable, approach described in 
detail in the Notice.22 CTIA argues that the Notice 
prescribes fees that raise an additional 6 percent above FY 1998, but 
that the proposed increase to CMRS Mobile services is over 10 percent. 
CTIA argues that this approach is wrong because it bases fees on growth 
in a particular sector of the industry instead of on the costs of 
regulating that sector, and it uses a figure that underestimates the 
number of wireless subscribers. We disagree and believe our actions are 
proper and consistent with the Act. As described above, the Commission 
began by estimating the number of units 23 for FY 1999 for 
each industry and multiplying that figure by each industry's FY 1998 
per unit charge. The amount which resulted was $157.6 million, $14.9 
million less than required by Congress.24 To collect the 
difference, the Commission ``then adjusted the revenue requirements for 
each category on a proportional basis.'' 25 In other words, 
each communications sector's proportional contribution percentage was 
multiplied by the anticipated shortfall, and the result was added to 
that sector's total revenue requirement for FY 1999. Finally, the total 
revenue requirement was divided by the total number of estimated units 
to determine the per unit fee for each category.26
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    \20\ See FY 1999 NOI at paragraph 9.
    \21\ CTIA comments at p. 2.
    \22\ CTIA comments at p. 2.
    \23\ ``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.'' Notice at paragraph 9, n.16. For 
the purpose of these Comments, the term ``subscribers'' is used 
interchangeably with ``units.''
    \24\ CTIA comments at p. 2.
    \25\ CTIA comments at p. 2-3.
    \26\ CTIA comments at p. 3.
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    23. Section 9(i) states that ``(t)he Commission shall develop 
accounting systems necessary to making the adjustments authorized by 
subsection (b)(3).'' Subsection (b)(3) states that ``(i)n addition to 
the adjustments required by paragraph (2), the Commission shall, by 
regulation, amend the Schedule of Regulatory Fees if the Commission 
determines that the Schedule requires an amendment to comply with the 
requirements of paragraph (1)(A).'' Paragraph (2) refers to paragraph 
(b)(2) which requires that ``the Commission shall, by rule, revise the 
Schedule of Regulatory Fees by proportionate increases or decreases to 
reflect, in accordance with paragraph (1)(B), changes in the amount 
appropriated for the performance of the activities described in 
subsection (a) for such fiscal year.'' Subsection (b)(2)(A) requires 
the adjustments to be made in accordance with the ``increases or 
decreases in the number of licensees or units subject to payment of 
such fees.'' Subsection (b)(2)(B) requires that the fees be 
``established at amounts that will result in collection of an aggregate 
amount of fees pursuant to this section that can reasonably be expected 
to equal the aggregate amount of fees that are required to be collected 
by appropriations Acts pursuant to paragraph (1)(B).''
    24. Given the provisions as a whole, the statute requires that, 
first and foremost, we must attempt to collect the aggregate amount 
that Congress requires in the appropriation Act, i.e. $172,523,000 for 
FY 1999. To achieve this, we must first adjust our estimates of payment 
units and apply proportionate shares of the shortfall to all fee 
categories until the $172,523,000 total is reached. At this point, we 
have the option of making permitted amendments, if we determine that it 
is required. Bearing in mind that any reduction in the fee obligations 
for any fee category must result in additional increases in the fee 
obligations imposed on all other fee categories to insure full 
collection of the $173,523,000, we (with one minor exception, namely FM 
Construction Permits) did not propose such amendments, and use of the 
cost accounting system to support such adjustments was not necessary. 
Finally, our cost accounting system has been previously explained in 
great detail in our FY 1996 and FY 1997 proceedings. It is the language 
of the Act in section (b)(2) which establishes the relationship between 
the number of payment units and the costs we must recover for our 
regulatory activities. Nothing in CTIA's argument convinces us that we 
erred in our methodology.
    25. CTIA also argues that we have seriously underestimated the 
number of CMRS units. It states that it ``is confident that the number 
of CMRS mobile services units has risen dramatically over last year--
enough to result in a substantial decrease in per unit charges.'' 
27 CTIA states that the ``correct number for FY 1999 is 
69,209,000 units, not the 55,540,000 units the Commission has 
estimated.'' 28 In its comments, AirTouch also argues that 
our estimate is too low.
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    \27\ CTIA comments at p. 5
    \28\ CTIA comments at p. 5.
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    26. In determining its estimates of the number of payment units, 
the Commission consults several sources, if available. We have found 
that there are often large disparities in the estimates provided by 
various industry associations. These differences may be due to the 
differences in purposes for which the data is gathered, sampling 
methods used, etc. It should be further noted that our experience with 
industry estimates in prior years has resulted in high levels of 
underpayment in the CMRS category. Given the fact that we are required 
by the statute to collect ``an amount that can reasonably be expected 
to equal the amount appropriated * * *'' we have proposed to establish 
estimates that more closely match the number of units for which 
payments have been received. With regard to the CMRS sector, the 
following chart shows the number of subscriber payment units estimated 
and the actual number based on fee payments per year.

------------------------------------------------------------------------
                                                                CMRS
                                              CMRS  mobile    messaging
------------------------------------------------------------------------
FY 1995 ESTIMATE............................    23,400,000    19,600,000
FY 1995 ACTUAL..............................    22,959,273    12,189,094
FY 1996 ESTIMATE............................    30,000,000    24,500,000
FY 1996 ACTUAL..............................    24,560,543    18,810,299
FY 1997 ESTIMATE............................    51,472,190    48,900,000
FY 1997 ACTUAL..............................    43,553,534    31,047,469
FY 1998 ESTIMATE............................    55,540,000    39,592,000
FY 1998 ACTUAL..............................    54,730,365    34,373,200
------------------------------------------------------------------------

    Given the data before us, while recognizing it is a conservative 
increase over the 1998 actual figure, we continue to believe our 
estimate for 1999 is

[[Page 35836]]

reasonable, especially in light of our reclassification of small SMR 
systems.
v. Re-Activation of Interactive Video Data Services Fee (Now 218-219 
MHz Service)
    27. When the NPRM was being developed, it was thought that there 
would be no interactive video data service (IVDS) applications received 
in FY 1999. No new assignments are available and most previous 
authorizations were granted for a ten-year license term (none of which 
expire in FY 1999). After release of the NPRM, it was discovered that 
there are 513 IVDS licenses that were issued with five-year expiration 
dates that will come up for renewal in FY 1999. Therefore, we are re-
activating the regulatory fee for IVDS (now 218-219 MHz Service) and 
have calculated it to be $13 on an annual basis. The entire regulatory 
fee will be $65 for a five-year term.

D. Other Issues Raised by Commenters

    28. On November 10, 1998, the Commission adopted a Notice of 
Inquiry in this proceeding seeking comments on five specific 
issues.29 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; 30 (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's 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. In the interest of 
expediting the NPRM, we deferred analysis of the comments and replies 
received pursuant to the NOI for inclusion in this final Report and 
Order.
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    \29\ 63 FR 70090 (Dec. 18, 1998).
    \30\ In this regard we specifically requested 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.
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    29. In addition to the comments which support the changes we are 
adopting in this Report and Order, commenters expressed other views 
which we intend to address here. These issues cover comments and reply 
comments received on both the NOI and the NPRM.
i. Interstate Telephone Service Providers
    30. In the NOI,31 we solicited comment on BellSouth 
Corporation's (BellSouth) proposal to change the methodology used to 
assess fees upon interstate telephone service providers. Specifically, 
BellSouth proposed that the regulatory fees imposed upon interstate 
telephone service providers be based on their end user revenues (i.e., 
the same contribution base used for the Universal Fund), instead of the 
current methodology, which is based on their proportionate share of 
industry net revenues (i.e., the same contribution base used for the 
TRS Fund). BellSouth contended that its proposal is ``more 
competitively neutral,'' given that the current methodology favors 
interexchange carriers (``IXCs'') by virtue of the fact that they are 
able to deduct payments made to the underlying carriers. The end user 
methodology was opposed by MCI WorldCom, Inc. (MCI WorldCom), which 
claimed that this methodology effectively would shift regulatory costs 
from the local exchange carriers (``LECs'') to the ``highly 
competitive, price sensitive'' IXCs (which unlike LECs cannot recover 
their costs through regulated rates) and, as such, would not be 
competitively neutral. BellSouth supported the end user methodology, 
but recommended that the Commission defer consideration on the 
appropriate methodology until it concludes the pending rulemaking (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), which is examining, among other things, both TRS and 
Universal Fund support mechanisms.32 We believe that 
properly calculated, the end result should be relatively equivalent 
regardless of whether the fee is based on gross revenues less expenses 
paid to the underlying carriers or end user revenues.
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    \31\ See FY 1999 NOI at paragraph 15.
    \32\ FCC 98-233, released September 25, 1998, 63 FR 54090 (Oct. 
8, 1998).
---------------------------------------------------------------------------

    31. We are unpersuaded by MCI WorldCom, Inc.'s contention that the 
end-user telecommunications revenue method is not competitively neutral 
simply because it will attribute a greater portion of direct 
contributions to IXCs.33 As support for its proposal that 
the Commission utilize a net telecommunications revenue basis for NANP 
and TRS, MCI correctly observes that the portion of contributions paid 
by IXCs will likely increase, as compared to that paid directly by 
local service providers, under an end-user telecommunications revenue 
basis, primarily because toll carriers, including IXCs, will contribute 
based on the revenues they collect from their end users to pay 
incumbent LECs' access charges. As described above, however, the end-
user basis meets our two prong test for competitive neutrality, as set 
out in the LNP Cost Recovery Order.34 The fact that 
carriers--whether IXCs or incumbent LECs--providing interstate toll 
services to end users may bear a slightly higher portion of 
contributions does not alter that analysis, because, even assuming that 
MCI's projections are correct, this change would not give one service 
provider an appreciable, incremental cost advantage when competing for 
a particular subscriber.
---------------------------------------------------------------------------

    \33\ See MCI Reply Comments at 4.
    \34\ See LNP Cost Recovery Order, paragraph 106-107.
---------------------------------------------------------------------------

    32. Further, we believe that MCI's analysis of the purported burden 
shift falls short. We do not believe that this change in revenue basis 
will significantly favor one segment of the industry over another. To 
the extent that direct contributions are shifted, we note that IXCs 
would incur those costs attributable to access revenues under both a 
net telecommunications revenue basis and an end-user telecommunications 
revenue basis.35 For example, contributions to the TRS 
mechanism under the current gross telecommunications revenue basis are 
treated as exogenous costs under price cap regulation, meaning that the 
overwhelming majority of these costs are passed through to toll 
carriers under

[[Page 35837]]

either methodology.36 As the Commission concluded in the LNP 
Cost Recovery Order, because the end-user telecommunications revenue 
basis reaches the same result, but without the inefficiency and added 
complication of the pass-through step, we prefer the end-user 
telecommunications revenue basis.37 In any event, we agree 
with BellSouth that any decision on the appropriate methodology should 
be deferred until the conclusion of the pending rulemaking proceeding.
---------------------------------------------------------------------------

    \35\ See Telecommunications Relay Services and the Americans 
with Disabilities Act of 1990, Second Order on Reconsideration and 
Fourth Report and Order, FCC 93-463, Docket No. 90-571, 9 FCC Rcd 
1637 (rel. Sept. 29, 1993) (clarifying that TRS Fund contributions 
may be treated as exogenous costs under price cap regulation). To 
this end, we believe that AT&T suggestion concerning price cap 
reductions would be more appropriately considered in access charge 
proceedings. See CFR section 69.1. See also LNP Cost Recovery Order, 
paragraph 109 (suggesting that incumbent LECs would like pass on 
shared costs of number portability to IXCs through exogenous 
treatment in their access rates).
    \36\ Id.
    \37\ See LNP Cost Recovery Order, paragraph 109.
---------------------------------------------------------------------------

ii. New Serices Fee Category
    33. In the NOI we sought comments on establishing a new services 
fee category. The regulatory costs associated with the policy and 
rulemaking to establish new and emerging technologies and services were 
to be charged to the new services activity. The costs attributed to the 
new services category were then to be distributed proportionally to all 
other feeable activities, and would not be borne by a specific, 
established service.
    34. GE American Communications, Inc. (GE) argues in support of 
establishing a new services fee category on the basis that until an 
authorization is granted, licensees are unknown and it would be unfair 
to attribute the costs to existing licensees. BellSouth, Personal 
Communications Industry Association (PCIA), and Lockheed Martin, on the 
other hand, disagree that it would be appropriate to charge costs to 
licensees in other unrelated service categories in the form of overhead 
when it is clear that they derive no benefit from the regulatory 
activity. Indeed, as BellSouth points out, under section 9(a)(1), the 
Commission shall assess and collect regulatory fees for rulemaking 
proceedings, which would include the costs associated with the 
introduction of new services. However, section 9(b)(1)(A) provides that 
the fees assessed must be adjusted ``to take into account factors that 
are reasonably related to the payor of the fee.'' BellSouth thus 
asserts that an ``across-the-board'' new service fee category would not 
comply with section 9(b)(1)(A), because it would impose fees on payers 
who are not benefited by the introduction of the new service.
    35. We are not persuaded that creation of a new services category 
is appropriate at this time. Further, this concept presents technical 
and policy problems with respect to our current cost accounting system 
which cannot be resolved for FY 1999 fee collections. Data is not 
available in its present form and costs cannot be reallocated as would 
be necessary to implement a new services fee category now. We are in 
the planning stages for rewriting the software for our cost accounting 
system, and this issue will become part of those discussions.
iii. COMSAT and Non-U.S. Licensees
    36. PanAmSat and GE American Communications argue that we should 
impose fees on COMSAT Corporation (COMSAT) to recover the Signatory and 
other expenses created by COMSAT. Loral Space & Communications states 
that because COMSAT competes with other U.S. satellite operators that 
are subject to regulatory fees, it is given a clear advantage over its 
competitors. Loral Space and Communications, therefore, contends that 
the Commission should impose fair and equitable fees on COMSAT. This 
issue has been considered and dismissed several times. In addition, GE, 
the Satellite Industry Association (SIA), and PanAmSat contend that the 
cost of regulation should be borne by all satellite service providers, 
which in light of the recent privatization of Inmarsat Limited, should 
include fair share payments from COMSAT and foreign-licensed satellite 
providers. Previously, because of the International Organization 
Immunities Act, COMSAT was exempt from paying regulatory fee payments 
for Inmarsat space stations. In its reply comments, COMSAT argues to 
the contrary that neither COMSAT, INTELSAT, nor Inmarsat are subject to 
Section 9 of the Communications Act of 1934, and neither Inmarsat nor 
its satellites are subject to Title III of the Act. In short, COMSAT 
argues that the FCC lacks jurisdiction in imposing space station or any 
new category of fees on COMSAT because ``regulatory fees apply only to 
space stations directly licensed by the FCC under Title III of the 
Communications Act.'' Finally, SIA questions the estimate of 42.5 GSO 
space stations.
    37. COMSAT has in the past and continues to be responsible for 
payment of regulatory fees for its licensed facilities. For example, in 
FY 1998, COMSAT paid regulatory fees for two geostationary space 
stations, 142 earth stations, and 53,957 international bearer circuits 
for a total of $585,172. With respect to the estimate of 42.5 GSO space 
stations, based on the October 1, 1998 cut-off date, there are 43 
satellites in operation. However, Columbia received a waiver for one-
half the capacity for one of its satellites. The waiver was granted 
because Columbia established that, unlike other U.S. fixed satellite 
service licensees, it was under contract with NASA, its satellite 
capacity was not entirely within its control, and its use was secondary 
to NASA's.38 Therefore, the GSO fees was formulated based on 
42.5 satellites.
---------------------------------------------------------------------------

    \38\ 1999 Westlaw 22920. In regarding Application of Columbia 
Communications Corporation, FCC 98-299 (January 22, 1999) (WESTLAW, 
FCOM-FCC library).
---------------------------------------------------------------------------

    38. The space station facilities owned by INTELSAT and Inmarsat are 
not licensed to COMSAT. COMSAT has been designated to represent the 
United States as its signatory agent. As COMSAT argues, the courts have 
ruled that we may not assess a fee upon COMSAT for its role in the 
administration of the INTELSAT and Inmarsat space stations. Moreover, 
commenters have argued that since Inmarsat space stations were 
converted ``to a newly created private company, Inmarsat Limited 
(incorporated in the United Kingdom), COMSAT's exemption from payment 
in relation to the Inmarsat system should be eliminated. Legislation 
requiring INTELSAT to privatize is currently pending before Congress, 
and full privatization is not complete. At present, it is not clear who 
will hold the license after privatization. Therefore, COMSAT presently 
remains as the designated U.S. Signatory to INTELSAT. Regardless of 
COMSAT's interest in the INTELSAT satellites in question, they are not 
licensed under Title III and, therefore, not subject to regulatory 
fees.39
---------------------------------------------------------------------------

    \39\ Assessment and Collection of Regulatory Fees for Fiscal 
Year 1995, 60 FR 30004 (June 29, 1995) and Assessment and Collection 
of Regulatory Fees for Fiscal Year 1997, 62 FR 37408 (July 11, 
1997); COMSAT Corp v. Federal Communications Commission, 114 F. 3d 
223 (D.C. Cir. 1997).
---------------------------------------------------------------------------

    39. It has also been suggested that non-U.S. licensed satellite 
service providers who operate in the U.S. should be assessed regulatory 
fees. Clearly, legislative history provides that only space stations 
licensed under Title III may be subject to regulatory fees. Although 
non-U.S.-licensed satellite operators do compete with U.S.-licensed 
satellite operators, they are not licensed under Title III. Therefore, 
we cannot include operators of non-U.S.-licensed satellite space 
stations among regulatory fee payers.
iv. Non-Common Carrier Bearer Circuits
    40. The Satellite Industry Association (``SIA'') maintains that the 
Commission should revisit whether it is authorized to assess 
international bearer circuit regulatory fees on non-common carrier 
satellite operators. According to SIA, because section 9 of the 
Communications Act specifies that carriers are required to pay 
international

[[Page 35838]]

bearer circuit fees, the Commission is only authorized to collect such 
fees from common carriers, not non-common carrier satellite operators. 
PanAmSat, in support of SIA, asserts that because non-common carrier 
bearer circuits are offered on a private basis and not subject to Title 
II regulations, they do not exact the same regulatory costs and should 
not be subject to the same regulatory fees as common carrier satellite 
operators.
    41. In response to SIA's position that international bearer circuit 
regulatory fees be imposed only on common carriers, the Commission 
contends that SIA's argument is a matter of terminology. When section 9 
was initially drafted, the fee schedule was divided along the lines of 
the existing bureaus and offices at the time. Since then, the 
Commission has undergone reorganizations and shifting of 
responsibilities for administering several services. When the original 
legislation was drafted, international bearer circuits were 
administered by the Common Carrier Bureau--thus in the Common Carrier 
Bureau section of the original schedule. With the creation of the 
International Bureau, international bearer circuits became the 
responsibility of the International Bureau. Moreover, justification for 
including non-common carrier circuits, which serve users 
internationally, was provided in previous years' 
proceedings.40
---------------------------------------------------------------------------

    \40\ See FY 1998 Report & Order at paragraphs 57-63.
---------------------------------------------------------------------------

v. Geostationary Orbit Space Stations (``GSOs'')
    42. In the NOI,41 we noted that the method of 
calculating and assessing the regulatory fees imposed on GSO licensees 
on a ``per satellite basis'' has been controversial and the subject of 
comments for several years. Therefore, we solicited comment on 
alternative methods for calculating and assessing GSOs regulatory fees. 
In this connection, we specifically requested commenters to ``specify 
the data upon which we can base any alternative approach and the most 
feasible method for obtaining the data necessary to calculate fees''. 
42 However, notwithstanding alternative methods for 
calculating regulatory fees, it is important to note that the 
percentage of increase in FY 1999 fees will not exactly match the 
overall Congressional increase of 6 percent. For most fee categories, 
the increase will be less than 10 percent, which is necessary to cover 
the costs of services that are exempt from payment of regulatory fees. 
In our FY 1998 Report and Order at paragraph 51, we explained that the 
costs used to develop our fees were derived from our cost accounting 
system which separates application processing costs from regulatory 
costs. We find nothing in the arguments put forth by the Satellite 
Industry Association (``SIA'') and GE American Communications (``GE'') 
which persuade us that our methodology is incorrect.
---------------------------------------------------------------------------

    \41\ See FY 1999 NOI at paragraph 10.
    \42\ See FY 1999 NOI at paragraph 10.
---------------------------------------------------------------------------

    43. PanAmSat, Loral and GE argue that the regulatory fees imposed 
on in-orbit GSOs bear scant relationship to the Commission's costs. 
Specifically, they argue that the Commission's costs are primarily 
incurred at the application stage, and are recovered through the 
substantial application fees imposed on GSO licensees. Because the 
Commission's oversight is very limited once the GSO space station is in 
orbit, they urge the Commission to re-examine the assessment of 
regulatory fees in this context to ensure that GSO licensees are not 
subsidizing other services.
    44. The Commission incurs costs for satellite policy and 
rulemaking, enforcement and user information activities. As directed by 
Congress, these costs must be recovered through the collection of 
regulatory fees. In accordance with the provisions of Section 9, the 
Commission's overall goal is to recover all of the costs associated 
with satellite regulatory activities and to distribute these costs 
fairly amongst fee payers, taking into account factors reasonably 
related to the benefits provided by the payer, as well as ``other 
factors we determine are necessary in the public interest.''
vi. Non-Geostationary Orbit Space Stations (``NGSOs'')
    45. In our NOI,43 we noted that Orbital Communications 
Corporation (``ORBCOMM'') had submitted comments in our FY 1998 
rulemaking proceeding, challenging the Commission's practice of 
requiring each NGSO licensee to pay regulatory fees upon commencement 
or certification of its first satellite's operation.44 
ORBCOMM contended that because all NGSOs licensees benefit from the 
Commission's policy, enforcement and information activities and 
services, they all should be required to pay regulatory fees, 
irrespective of whether they have launched their first satellite. Space 
Imaging L.P. (Space Imaging) suggests that the Commission should create 
a new regulatory fee category for small constellations of non-
geostationary orbit (NGSO) satellites. Further, Space Imaging 
recommends that the two categories be: (1) systems of up to five 
satellites and (2) systems of more than five satellites. Orbital 
Communications Corporation (ORBCOMM) argues that all NGSO systems 
authorized should pay regulatory fees regardless of whether or not 
there is at least one satellite launched and operational. L/Q Licensee, 
Inc. (LQL) and Globalstar LP (Globalstar) contend that a NGSO system is 
not operational until more than one satellite is capable of operating. 
LQL and Globalstar recommend that we delay requiring fee payment until 
the full constellation is completed, or that we establish a lower fee 
of 25% when only the first satellite becomes operational.
---------------------------------------------------------------------------

    \43\ See FY 1999 NOI at paragraph 11.
    \44\ See FY 1998 Report & Order at paragraph 55.
---------------------------------------------------------------------------

    46. For the reasons stated above, we believe that the methodology 
for establishing the fee increase is reasonable. Regarding L/QL's and 
Globalstar's proposal to delay fee payments, we decline to adopt the 
proposal. We have previously dismissed the idea of waiting until the 
full constellation is completed because of the potentially lengthy time 
that it takes to construct the entire system.45 The amount 
of revenue required for commercial viability will also vary from system 
to system, particularly since there is no standard time-frame to 
achieve commercial viability. Further, we are concerned that any 
attempt to establish a lower percentage fee will be fraught with 
endless discussion of what that percentage should be. The concept of 
establishing separate categories for small and large constellations may 
warrant consideration. However, further study is needed and more 
systems need to be operational before we can properly evaluate its 
appropriateness. For FY 1999, the fee payment criteria for NGSO systems 
will remain unchanged.
---------------------------------------------------------------------------

    \45\ Assessment and Collections of Regulatory Fees for Fiscal 
Year 1997, 62 FR 37408 (July 11, 1997), at paragraph 75.
---------------------------------------------------------------------------

vii. Commercial Radio and Television
    47. The National Association of Broadcasters (NAB) supports the 
Commission's use of allocating fees for AM and FM stations based on 
station class and population served by each station. According to NAB, 
it received fewer complaints in 1998 after the Commission revised its 
AM and FM station fee methodology. Although NAB acknowledges that the 
Commission's 1998 fee methodology is a noticeable improvement from 
1997, NAB argues that stations located in suburban areas, but close to 
larger urban centers, are assessed a larger licensing fee simply

[[Page 35839]]

because they are located near larger advertising markets. For equitable 
reasons, NAB urges the Commission to entertain requests for partial fee 
waivers from stations that are located close to a larger listening 
audience.
    48. Although NAB supports the Commission on its allocation of fees 
on an individual station basis, NAB disagrees with the Commission for 
increasing the broadcast industry's overall fees by 9.4 percent rather 
than by the 6% that Congress required the Commission to collect. NAB 
acknowledges that the increase is a congressional requirement, but 
feels that the 9.4% increase for the broadcast industry as a whole is 
far greater than what Congress required of the Commission, particularly 
since the number of payment units in the broadcast industry has 
increased from the previous year. Furthermore, NAB also argues that the 
Commission does not explain the basis of its costs in regulating the 
broadcast industry, except by showing that the number of FY 1999 
estimated units were multiplied by the FY 1998 fee, and pro-rated among 
all existing fee categories. Hence, according to NAB, without these 
calculations, it is not easily apparent whether the cost of regulating 
the broadcast industry has actually increased or decreased, or whether 
the broadcast industry is bearing the costs of regulating other aspects 
of the communication industry. Finally, NAB also argues that the fruits 
of the Commission's streamlining efforts should be incorporated into 
the fee methodology, resulting in lower application and regulatory 
fees.
    49. With respect to NAB's request that partial fee waivers be 
granted, the Commission's rules already provide for petitions for 
waivers. We will consider such requests on an individual basis and on 
the particular merits of the situation. Absent specific information to 
indicate whether a waiver is warranted, it would be inappropriate to 
guarantee results in favor of any group of broadcast licensees in 
general herein.
    50. Although the overall regulatory fee increase is approximately 
6%, factoring in costs for exempt entities, overhead, and changes due 
to increases or decreases in payment units could cause some shifting or 
cross-subsidization, which means that application of the required 
increase may not fall equally on every group of fee payers. Cost data 
from our cost accounting system was reviewed before making the decision 
not to apply the data across-the-board to all services as wholesale 
permitted amendments. The use of the cost data in implementing this 
cost shifting proved too extreme and would have required significantly 
higher increases in several fee categories than the 9.4 percent that 
NAB questions. This occurs because the actual costs attributable to 
several other services would require fees that are as much as several 
thousand percent above what it would be reasonable and fair to charge. 
Also, a few services would have decreases in fees which would require 
adding more costs to other services in order to collect the amount that 
Congress requires us. Finally, as many other commenters, NAB argues 
that its industry is being streamlined or deregulated. Nearly all 
commenters have argued that deregulation has benefited one industry 
over another. However, ultimately, it does not change the fact that we 
must collect the full $172.5 million proportionately from all payers.
viii. Fee Filing Software
    51. The Walt Disney Company states that while the Commission 
prefers that payers of multiple fees file using FCC software, that 
software has been plagued with errors and released too near the payment 
deadline.
    52. The Commission recognizes, and is striving to remedy, the 
problems associated with the software and the late release last year. 
We are planning to conduct beta testing and to release the ``fee 
filer'' user software in July 1999, well in advance of the filing 
deadline of mid-September. A Public Notice will be released including a 
detailed description of the software application. Anyone wishing to 
participate in the beta testing may contact Linwood Jenkins at (202) 
418-1995.
    53. Regulatees paying for more than 50 licenses may utilize the 
``fee filer'' software, or complete the individual copies of the FCC 
Form 159 and 159C. The FCC Form 159 must be completed in its entirety. 
Improperly completing the FCC Form 159 and 159C will result in a delay 
in crediting your account. These are the only two acceptable methods of 
submission. The Commission will not accept any attachments listing call 
signs. Each call sign must be listed separately on the Form 159/159C in 
order to receive proper credit.

E. Procedures for Payment of Regulatory Fees

    54. Generally, we will 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 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 establishing 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
    55. As we have in the past, we are treating 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 respective regulatory fee category. The payment dates for each 
regulatory fee category will be announced either in this 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
    56. As we noted in the NPRM, time constraints will preclude an 
opportunity for installment payments. Due to statutory constraints 
concerning notification to Congress prior to actual collection of the 
fees, there will not be sufficient time for installment payments, and 
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 a single payment will be announced either in this 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
    57. As we have in the past, we are treating regulatory fee payments 
by certain licensees as ``small'' fees subject to advance payment 
consistent with the requirements of section 9(f)(2). 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.46 Payers of 
advance fees

[[Page 35840]]

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 
must 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 this Report and 
Order terminating this proceeding or by public notice published in the 
Federal Register pursuant to authority delegated to the Managing 
Director.
---------------------------------------------------------------------------

    \46\ 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, 
218-219 MHz Service (previously IVDS), and General Mobile Radio 
Service (GMRS).
---------------------------------------------------------------------------

iv. Minimum Fee Payment Liability
    58. As we have in the past, we are establishing 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
    59. As noted, the time for payment of standard fees and any 
installment payments will be announced in this 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, fees must be paid for any 
authorization issued on or before October 1, 1998.47
---------------------------------------------------------------------------

    \47\ 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.
---------------------------------------------------------------------------

    60. In the case of regulatees whose fees are based upon a 
subscriber, unit or circuit count, the number of the regulatees' 
subscribers, units or circuits on December 31, 1998, will be used to 
calculate the fee payment.48
---------------------------------------------------------------------------

    \48\ 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: BulkRate 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.
---------------------------------------------------------------------------

vi. Improved Fee Collection Systems
    61. The Commission is taking several steps to improve its fee 
collection program. Development of a new fee collections system is 
currently underway that will provide a single improved internal source 
of information for all of the Commission's financial transactions. In 
addition, we are establishing procedures that will require assignment 
of a unique identifier code to each entity doing business with the FCC 
to enable it to track payments and other transactions made by the 
entity, even when its name or ownership changes. These enhancements 
will assist the FCC in identifying all feeable entities and ensuring 
that proper payments are received and recorded accurately.
vii. Late or Insufficient Regulatory Fee Payment
    62. As a reminder, in accordance with section 1.1164 of the 
Commission's Rules, regulatees will be subject to a 25 percent penalty 
for late or insufficient regulatory fee payment. All payments not 
received by the due date shall be assessed the penalty.

F. Schedule of Regulatory Fees

    63. The Commission's Schedule of Regulatory Fees for FY 1999 is 
contained in Attachment D of this Report and Order.

IV. Procedural Matters

A. Ordering Clause

    64. Accordingly, it is ordered that the rule changes specified 
herein are adopted. It is further ordered that the rule changes made 
herein will become effective 60 days from the date of publication in 
the Federal Register, except that changes to the Schedule of Regulatory 
Fees made pursuant to section 9(b)(3) of the Communications Act, and 
incorporating regulatory fees for FY 1999, will become effective 
September 10, 1999, which is 90 days from the date of notification to 
Congress. A Final Regulatory Flexibility Analysis (FRFA) has been 
performed and is found in Attachment A, and it is ordered that the 
Office of Public Affairs send this to Small Business Administration. 
Finally, it is ordered that this proceeding is Terminated.

B. Authority and Further Information

    65. This action is taken pursuant to sections 4(i) and (j), 9, and 
303(r) of the Communications Act of 1934, as amended,49 47 
U.S.C. 154(i) and (j), 9, and 303(r).
---------------------------------------------------------------------------

    \49\ 47 U.S.C. 154(i)-(j), 159, & 303(r).
---------------------------------------------------------------------------

    66. Further information about this proceeding may be obtained by 
contacting the Fees Hotline at (202) 418-0192.

List of Subjects in 47 CFR Part 1

    Administrative practice and procedure, Communications common 
carriers, Radio, Telecommunications, Television.

Federal Communications Commission.
Magalie Roman Salas,
Secretary.

Rule Changes

    For the reasons discussed in the preamble, part 1 of Title 47 of 
the Code of Federal Regulations is amended as follows:

PART 1--PRACTICE AND PROCEDURE

    1. The authority citation for Part 1 continues to read as follows:

    Authority: 15 U.S.C. 79 et seq.; 47 U.S.C. 151, 154(i), 154(j), 
155, 225, and 303(r).

    2. Sec. 1.1152 is revised to read as follows:


Sec. 1.1152  Schedule of annual regulatory fees and filing locations 
for wireless radio services.

------------------------------------------------------------------------
  Exclusive use services (per
            license)             Fee amount \1\          Address
------------------------------------------------------------------------
1. Land Mobile (Above 470 MHz,
 Base Station and SMRS) (47
 CFR, Part 90).
    (a) 800 MHz, New, Renewal,           $13.00  FCC, 800 MHz, P.O. Box
     Reinstatement (FCC 600).                     358130, Pittsburgh, PA
                                                  15251-5130.

[[Page 35841]]

 
    (b) 900 MHz, New, Renewal,            13.00  FCC, 900 MHz, P.O. Box
     Reinstatement (FCC 600).                     358130, Pittsburgh, PA
                                                  15251-5130.
    (c) 470-512,800,900, 220              13.00  FCC, 470-512, P.O. Box
     MHz, 220 MHz Nationwide                      358245, Pittsburgh, PA
     Renewal (FCC 574R, FCC                       15251-5245.
     405A).
    (d) Correspondence Blanket            13.00  FCC, Corres., P.O. Box
     Renewal (470-                                358130, Pittsburgh, PA
     512,800,900,220 MHz)                         15251-5130.
     (Remittance Advice,
     Correspondence).
    (e) 220 MHz, New, Renewal,            13.00  FCC, 220 MHz, P.O. Box
     Reinstatement (FCC 600).                     358130, Pittsburgh, PA
                                                  15251-5130.
    (f) 470-512 MHz New,                  13.00  FCC, 470-512 P.O. Box
     Renewal, Reinstatement                       358130, Pittsburgh, PA
     (FCC 600).                                   15251-5130.
    (g) 220 MHz Nationwide,               13.00  FCC, Nationwide, P.O.
     New, Renewal,                                Box 358130,
     Reinstatement (FCC 600).                     Pittsburgh, PA 15251-
                                                  5130.
2. Microwave (47 CFR Pt. 101):
    (a) Microwave, New,                   13.00  FCC, Microwave, P.O.
     Renewal, Reinstatement                       Box 358130,
     (FCC 415).                                   Pittsburgh, PA 15251-
                                                  5130.
    (b) Microwave, Renewal (FCC           13.00  FCC, Microwave, P.O.
     402R).                                       Box 358255,
                                                  Pittsburgh, PA 15251-
                                                  5255.
    (c) Correspondence,s                  13.00  FCC, Corres., P.O. Box
     Blanket Renewal                              358130, Pittsburgh, PA
     (Microwave) (Remittance                      15251-5130.
     Advice, Correspondence).
3. 218-219 MHz Service:
    (a) New, Renewal (FCC 574             13.00  FCC, 218-219 MHz
     or FCC 600).                                 Service, P.O. Box
                                                  358130, Pittsburgh, PA
                                                  15251-5130.
4. Shared Use Services:
    (a) Land Transportation                7.00  FCC, Land Trans., P.O.
     (LT), New, Renewal,                          Box 358130,
     Reinstatement (FCC 600).                     Pittsburgh, PA 15251-
                                                  5130.
    (b) Business (Bus.) New,               7.00  FCC, Business, P.O. Box
     Renewal, Reinstatement                       358130, Pittsburgh, PA
     (FCC 600).                                   15251-5130.
    (c) Other Industrial (OI),             7.00  FCC, Other Indus., P.O.
     New, Renewal,                                Box 358130,
     Reinstatement (FCC 600).                     Pittsburgh, PA 15251-
                                                  5130.
    (d) General Mobile Radio               7.00  FCC, GMRS P.O. Box
     Service (GMRS), New,                         358130, Pittsburgh, PA
     Renewal, Modifications                       15251-5130.
     (RM) (FCC 605).
    (e) Business, Other                    7.00  FCC, Bus., OI, LT, P.O.
     Industrial, Land                             Box 358245,
     Transportation, Renewal                      Pittsburgh, PA 15251-
     (FCC 574R, FCC 405A).                        5245.
    (f) GMRS Renewal (RO) (FCC             7.00  FCC,GMRS, P.O. Box
     605).                                        358245, Pittsburgh, PA
                                                  15251-5245.
    (g) Ground, New, Renewal,              7.00  FCC, Ground, P.O. Box
     Reinstatement (FCC 406).                     358130, Pittsburgh, PA
                                                  15251-5130.
    (h) Coast, New, Renewal,               7.00  FCC, Coast, P.O. Box
     Reinstatement (FCC 503).                     358130, Pittsburgh, PA
                                                  15251-5130.
    (i) Ground, Renewal (FCC               7.00  FCC, Ground, P.O. Box
     452R).                                       358270, Pittsburgh, PA
                                                  15251-5270.
    (j) Coast, Renewal (FCC                7.00  FCC, Coast, P.O. Box
     452R).                                       358270, Pittsburgh, PA
                                                  15251-5270.
    (k) Ship, New, Renewal,                7.00  FCC, Ship, P.O. Box
     Reinstatement (FCC 506).                     358130, Pittsburgh, PA
                                                  15251-5130.
    (l) Aircraft, New,                     7.00  FCC, Aircraft, P.O. Box
     Renewal,Modification (RM),                   358130 Pittsburgh, PA
     Reinstatement (FCC 605).                     15251-5130.
    (m) Ship, Renewal (FCC                 7.00  FCC, Ship, P.O. Box
     405B).                                       358290, Pittsburgh, PA
                                                  15251-5290.
    (n) Aircraft, Renewal (RO)             7.00  FCC, Aircraft, P.O. Box
     (FCC 605).                                   358245, Pittsburgh, PA
                                                  15251-5245.
    (o) Correspondence, Blanket            7.00  FCC, Corres. P.O. Box
     Renewal (Bus.,OI,LT)                         358130, Pittsburgh, PA
     (Remittance Advice,                          15251-5130.
     Correspondence).
    (p) Correspondence, Blanket            7.00  FCC, Corres., P.O. Box
     Renewal (Ground)                             358130, Pittsburgh, PA
     (Remittance Advice,                          15251-5130.
     Correspondence).
    (q) Correspondence, Blanket            7.00  FCC, Corres., P.O. Box
     Renewal (Coast)                              358130, Pittsburgh, PA
     (Remittance Advice,                          15251-5130.
     Correspondence).
    (r) Correspondence, Blanket            7.00  FCC, Corres., P.O. Box
     Renewal (Ship) (Remittance                   358130, Pittsburgh, PA
     Advice, Correspondence).                     15251-5130.
5. Amateur Vanity Call Signs...            1.40  FCC, Amateur Vanity,
                                                  P.O. Box 358924,
                                                  Pittsburgh, PA 15251-
                                                  5924.
6. CMRS Mobile Services, (per               .32  FCC, Cellular, P.O. Box
 unit).                                           358835, Pittsburgh, PA
                                                  15251-5835.
7. CMRS Messaging Services (per             .04  FCC, Messaging, P.O.
 unit).                                           Box 358835,
                                                  Pittsburgh, PA 15251-
                                                  5835.
------------------------------------------------------------------------
\1\ Note that small fees are collected in advance for the entire license
  term. Therefore, the annual fee amount shown in this table must be
  multiplied by the 5-or 10-year license term, as appropriate, to arrive
  at the total amount of regulatory fees owed. It should be further
  noted that application fees may also apply as detailed in Section
  1.1102 of this chapter.

    3. Sec. 1.1153 is revised to read as follows:


Sec. 1.1153  Schedule of annual regulatory fees and filing locations 
for mass media services.

------------------------------------------------------------------------
                                   Fee amount            Address
------------------------------------------------------------------------
I. Radio [AM and FM] (47 CFR,
 Part 73)
    1. AM Class A:
        <=20,000 population....            $430  FCC, Radio, P.O. Box
                                                  358835, Pittsburgh,
                                                  PA, 15251-5835.
        20,001-50,000                       825
         population.
        50,001-125,000                    1,350
         population.
        125,001-400,000                   2,000
         population.
        400,001-1,000,000                 2,750
         population.

[[Page 35842]]

 
        >1,000,000 population..           4,400
    2. AM Class B:
        <=20,000 population....             325
        20,001-50,000                       650
         population.
        50,001-125,000                      875
         population.
        125,001-400,000                   1,400
         population.
        400,001-1,000,000                 2,250
         population.
        >1,000,000 population..           3,600
    3. AM Class C:
        <=20,000 population....             225
        20,001-50,000                       325
         population.
        50,001-125,000                      450
         population.
        125,001-400,000                     675
         population.
        400,001-1,000,000                 1,250
         population.
        >1,000,000 population..           1,750
    4. AM Class D:
        <=20,000 population....             275
        20,001-50,000                       450
         population.
        50,001-125,000                      675
         population.
        125,001-400,000                     825
         population.
        400,001-1,000,000                 1,500
         population.
        >1,000,000 population..           2,250
    5. AM Construction Permit..             260
    6. FM Classes A, B1 and C3:
        <=20,000 population....             325
        20,001-50,000                       650
         population.
        50,001-125,000                      875
         population.
        125,001-400,000                   1,400
         population.
        400,001-1,000,000                 2,250
         population.
        >1,000,000 population..           3,600
    7. FM Classes B, C, C1 and
     C2:
        <=20,000 population....             430
        20,001-50,000                       825
         population.
        50,001-125,000                    1,350
         population.
        125,001-400,000                   2,000
         population.
        400,001-1,000,000                 2,750
         population.
        >1,000,000 population..           4,400
    8. FM Construction Permits.             780
II. TV (47 CFR, Part 73) VHF
 Commercial:
    1. Markets 1 thru 10.......          41,225  FCC, TV Branch, P.O.
                                                  Box 358835,
                                                  Pittsburgh, PA, 15251-
                                                  5835.
    2. Markets 11 thru 25......          34,325
    3. Markets 26 thru 50......          23,475
    4. Markets 51 thru 100.....          13,150
    5. Remaining Markets.......           3,400
    6. Construction Permits....           2,775
III. TV (47 CFR, Part 73) UHF
 Commercial:
    1. Markets 1 thru 10.......          15,550  FCC, UHF Commercial,
                                                  P.O. Box 358835,
                                                  Pittsburgh, PA, 15251-
                                                  5835.
    2. Markets 11 thru 25......          11,775
    3. Markets 26 thru 50......           7,300
    4. Markets 51 thru 100.....           4,350
    5. Remaining Markets.......           1,175
    6. Construction Permits....           2,900
IV. TV (47 CFR, Part 73)
 Satellite UHF/VHF Commercial:
    1. All Markets.............           1,300  FCC Satellite TV, P.O.
                                                  Box 358835 Pittsburgh,
                                                  PA 15251-5835.
    2. Construction Permits....             460
V. Low Power TV, TV/FM                      290  FCC, Low Power, P.O.
 Translator,& TV/FM Booster (47                   Box 358835,
 CFR, Part 74).                                   Pittsburgh, PA 15251-
                                                  5835.
VI. Broadcast Auxiliary........              12  FCC, Auxiliary, P.O.
                                                  Box 358835,
                                                  Pittsburgh, PA 15251-
                                                  5835.
VII. Multipoint Distribution...             285  FCC, Multipoint, P.O.
                                                  Box 358835,
                                                  Pittsburgh, PA 15251-
                                                  5835.
------------------------------------------------------------------------

    4. Sec. 1.1154 is revised to read as follows:


Sec. 1.1154  Schedule of annual regulatory charges and filing locations 
for common carrier services.

------------------------------------------------------------------------
                                   Fee amount            Address
------------------------------------------------------------------------
I. Radio Facilities:
    1. Microwave (Domestic                  $13  FCC, Common Carrier,
     Public Fixed).                               P.O. Box 358130,
                                                  Pittsburgh, PA 15251-
                                                  5130.
II. Carriers:

[[Page 35843]]

 
    1. Interstate Telephone              .00121  FCC, Carriers, P.O. Box
     Service Providers (per                       358835, Pittsburgh,
     dollar contributed to TRS                    PA.
     Fund).
------------------------------------------------------------------------

    5. Sec. 1.1155 is revised to read as follows:


Sec. 1.1155  Schedule of regulatory fees and filing locations for cable 
television services.

------------------------------------------------------------------------
                                   Fee amount            Address
------------------------------------------------------------------------
1. Cable Antenna Relay Service.             $55  FCC, Cable, P.O. Box
                                                  358835, Pittsburgh, PA
                                                  15251-5835
2. Cable TV System (per                     .48
 subscriber).
------------------------------------------------------------------------

    6. Section 1.1156 is revised to read as follows:


Sec. 1.1156  Schedule of regulatory fees and filing locations for 
international services.

------------------------------------------------------------------------
                                   Fee amount            Address
------------------------------------------------------------------------
I. Radio Facilities:
    1. International (HF)                  $520  FCC, International,
     Broadcast.                                   P.O. Box 358835,
                                                  Pittsburgh, PA 15251-
                                                  5835.
    2. International Public                 410  FCC, International,
     Fixed.                                       P.O. Box 358835
                                                  Pittsburgh, PA 15251-
                                                  5835.
II. Space Stations                      130,550  FCC, Space Stations,
 (Geostationary Orbit).                           P.O. Box 358835,
                                                  Pittsburgh, PA 15251-
                                                  5835.
III. Space Stations (Non-               180,800  FCC, Space Stations,
 Geostationary Orbit).                            P.O. Box 358835,
                                                  Pittsburgh, PA 15251-
                                                  5835.
IV. Earth Stations Transmit/                180  FCC, Earth Station,
 Receive and Transmit Only (per                   P.O. Box 358835,
 authorization or registration).                  Pittsburgh, PA 15251-
                                                  5835.
V. Carriers:
    1. International Bearer                7.00  FCC, International,
     Circuits (per active 64KB                    P.O. Box 358835,
     circuit or equivalent).                      Pittsburgh, PA 15251-
                                                  5835.
------------------------------------------------------------------------

    Note: The following attachments will not appear in the Code of 
Federal Regulations.

Attachment A--Final Regulatory Flexibility Analysis

    1. As required by the Regulatory Flexibility Act (RFA), 
50-51 an Initial Regulatory Flexibility Analysis (IRFA) 
was incorporated in the Notice of Proposed Rulemaking, In the Matter 
of Assessment and Collection of Regulatory Fees for Fiscal Year 
1999, 64 FR 16661 (Apr. 6, 1999). The Commission sought written 
public comments on the proposals in its FY 1999 regulatory fees 
NPRM, including on the IRFA. This present Final Regulatory 
Flexibility Analysis (FRFA) conforms to the RFA, as amended (see 5 
U.S.C. 604).
---------------------------------------------------------------------------

    \50-51\ 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, Pub. 
L. 104-121, 110 Stat. 847 (1996) (CWAAA). Title II of the CWAAA is 
the Small Business Regulatory Enforcement Fairness Act of 1996 
(SBREFA).
---------------------------------------------------------------------------

I. Need for, and Objectives of, the Rules

    2. This rulemaking proceeding was initiated in order to collect 
regulatory fees in the amount of $172,523,000, the amount that 
Congress has required the Commission to recover through the 
collection of regulatory fees in FY 1999. The Commission seeks to 
collect the necessary amount through its revised regulatory fees, as 
contained in the attached Schedule of Regulatory Fees, in the most 
efficient manner possible and without undue burden on the public.

II. Summary of Significant Issues Raised by Public Comments in Response 
to the IRFA

    3. None.

III. Description and Estimate of the Number of Small Entities to Which 
the 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.52 The RFA 
generally defines the term ``small entity'' as having the same 
meaning as the terms ``small business,'' ``small organization,'' and 
``small governmental jurisdiction.'' 53 In addition, the 
term ``small business'' has the same meaning as the term ``small 
business concern'' under the Small Business Act.54 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).55 A small organization is generally 
``any not-for-profit enterprise which is independently owned and 
operated and is not dominant in its field.'' 56 
Nationwide, as of 1992, there were approximately 275,801 small 
organizations.57 ``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.'' 58 As of 1992, there were 
approximately 85,006 such jurisdictions in the United 
States.59 This number includes 38,978 counties, cities, 
and towns; of these, 37,566, or 96 percent, have populations of 
fewer than 50,000.60 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. Below, we further describe and 
estimate the number of small entity licensees and regulatees that 
may be affected by the rules, herein adopted.
---------------------------------------------------------------------------

    \52\ 5 U.S.C. 603(b)(3).
    \53\ Id. 601(6).
    \54\ 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).
    \55\ Small Business Act, 15 U.S.C. 632 (1996).
    \56\ 5 U.S.C. 601(4).
    \57\ 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).
    \58\ 5 U.S.C. 601(5).
    \59\ U.S. Dept. of Commerce, Bureau of the Census, ``1992 Census 
of Governments.''
    \60\ Id.
---------------------------------------------------------------------------

Cable Services for 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

[[Page 35844]]

revenue annually.61 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.62
---------------------------------------------------------------------------

    \61\ 13 CFR 121.201, SIC code 4841.
    \62\ 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 purposes of rate regulation. Under the 
Commission's rules, a ``small cable company'' is one serving fewer 
than 400,000 subscribers nationwide.63 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 1995.64 Since then, some of those companies may have 
grown, 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.
---------------------------------------------------------------------------

    \63\ 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).
    \64\ 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.'' 65 The Commission has determined 
that there are 64,000,000 subscribers in the United States. 
Therefore, we found that an operator serving fewer than 617,000 
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. 
66 Based on available data, we find that the number of 
cable operators serving 617,000 subscribers or less totals 1,450. 
67 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, 
68 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.
---------------------------------------------------------------------------

    \65\ 47 U.S.C. 543(m)(2).
    \66\ Id. 76.1403(b).
    \67\ Paul Kagan Associates, Inc., Cable TV Investor, Feb. 29, 
1996 (based on figures for Dec. 30, 1995).
    \68\ 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), 69 
multipoint distribution systems (MDS), 70 satellite 
master antenna systems (SMATV), and subscription television 
services.
---------------------------------------------------------------------------

    \69\ Direct Broadcast Services (DBS) are discussed with the 
international services, infra.
    \70\ 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 number of commercial wireless entities, appears to be 
data the Commission publishes in its Trends in Telephone Service 
report.71 According to data in the most recent report, 
there are 3,528 interstate carriers.72 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.
---------------------------------------------------------------------------

    \71\ FCC, Common Carrier Bureau, Industry Analysis Division, 
Trends in Telephone Service, Table 19.3 (February 19, 1999).
    \72\ 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.73 Below, 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.
---------------------------------------------------------------------------

    \73\ 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 analysis and use the term ``small ILECs'' to refer to any ILECs 
that arguably might be defined by the SBA as ``small business 
concerns.'' 74
---------------------------------------------------------------------------

    \74\ 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.75 
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, 
covered specialized mobile radio providers, and resellers. It seems 
certain that some of these 3,497 telephone service firms may not 
qualify as small entities or small ILECs because they are not 
``independently owned and operated.'' 76 For example, a 
reseller 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 rules, herein adopted.
---------------------------------------------------------------------------

    \75\ 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).
    \76\ 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 
1992.77 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.78 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

[[Page 35845]]

or small ILECs that may be affected by the rules, herein adopted.
---------------------------------------------------------------------------

    \77\ 1992 Census, supra, at Firm Size 1-123.
    \78\ 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.79 According to the 
most recent Telecommunications Industry Revenue data, 1,410 carriers 
reported that they were engaged in the provision of local exchange 
services.80 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 1,410 providers of local exchange service 
are small entities or small ILECs that may be affected by the rules, 
herein adopted.
---------------------------------------------------------------------------

    \79\ Id.
    \80\ Trends in Telephone Service, Table 19.3 (February 19, 
1999).
---------------------------------------------------------------------------

    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.81 According to the most recent Trends in 
Telephone Service data, 151 carriers reported that they were engaged 
in the provision of interexchange services.82 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 151 small entity IXCs that may be affected by the rules, 
herein adopted.
---------------------------------------------------------------------------

    \81\ 13 CFR 121.201, SIC code 4813.
    \82\ Trends in Telephone Service, Table 19.3 (February 19, 
1999).
---------------------------------------------------------------------------

    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.83 According to the most recent Trends in 
Telephone Service data, 147 carriers reported that they were engaged 
in the provision of competitive local exchange 
services.84 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 147 small entity 
CAPs that may be affected by the rules, herein adopted.
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    \83\ 13 CFR 121.201, SIC code 4813.
    \84\ Trends in Telephone Service, Table 19.3 (February 19, 
1999).
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    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.85 According to the most recent Trends in 
Telephone Service data, 32 carriers reported that they were engaged 
in the provision of operator services.86 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 32 small entity operator service 
providers that may be affected by the rules, herein adopted.
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    \85\ 13 CFR 121.201, SIC code 4813.
    \86\ Trends in Telephone Service, Table 19.3 (February 19, 
1999).
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    18. Pay Telephone Operators. Neither the Commission nor the SBA 
has 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.87 According to the 
most recent Trends in Telephone Service data, 509 carriers reported 
that they were engaged in the provision of pay telephone 
services.88 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 509 small entity pay telephone operators that may be affected 
by the rules, herein adopted.
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    \87\ 13 CFR 121.201, SIC code 4813.
    \88\ Trends in Telephone Service, Table 19.3 (February 19, 
1999).
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    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.89 
According to the most recent Trends in Telephone Service data, 358 
reported that they were engaged in the resale of telephone 
service.90 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 358 small entity 
resellers that may be affected by the rules, herein adopted.
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    \89\ 13 CFR 121.201, SIC code 4813.
    \90\ Trends in Telephone Service, Table 19.3 (February 19, 
1999).
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    20. 800 and 800-Like Service Subscribers.91 Neither 
the Commission nor the SBA has developed a definition of small 
entities specifically applicable to 800 and 800-like service (``toll 
free'') subscribers. The most reliable source of information 
regarding the number of these service subscribers appears to be data 
the Commission collects on the 800, 888, and 877 numbers in 
use.92 According to our most recent data, at the end of 
January 1999, the number of 800 numbers assigned was 7,692,955; the 
number of 888 numbers that had been assigned was 7,706,393; and the 
number of 877 numbers assigned was 1,946,538. 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 7,692,955 small entity 800 
subscribers, fewer than 7,706,393 small entity 888 subscribers, and 
fewer than 1,946,538 small entity 877 subscribers may be affected by 
the rules, herein adopted.
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    \91\ We include all toll-free number subscribers in this 
category, including 888 numbers.
    \92\ FCC, CCB Industry Analysis Division, FCC Releases, Study on 
Telephone Trends, Tbls. 21.2, 21.3 and 21.4 (February 19, 1999).
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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).93 This 
definition provides that a small entity is expressed as one with 
$11.0 million or less in annual receipts.94 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.95 The Census report 
does not provide more precise data.
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    \93\ An exception is the Direct Broadcast Satellite (DBS) 
Service, infra.
    \94\ 13 CFR 120.121, SIC code 4899.
    \95\ 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.

[[Page 35846]]

    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. Based on 
actual payments from FY 1998, there are approximately 3,100 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 3,100 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 would 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 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.
    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 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.'' 
96 This definition provides that a small entity is one 
with $11.0 million or less in annual receipts.97 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 would 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.
---------------------------------------------------------------------------

    \96\ 13 CFR 120.121, SIC code 4841.
    \97\ 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.98 The SBA defines a 
television broadcasting station that has $10.5 million or less in 
annual receipts as a small business.99 Television 
broadcasting stations consist of establishments primarily engaged in 
broadcasting visual programs by television to the public, except 
cable and other pay television services.100 Included in 
this industry are commercial, religious, educational, and other 
television stations.101 Also included are establishments 
primarily engaged in television broadcasting and which produce taped 
television program materials.102 Separate establishments 
primarily engaged in producing taped television program materials 
are classified under another SIC number.103 There were 
1,509 television stations operating in the nation in 
1992.104 That number has remained fairly constant as 
indicated by the approximately 1,564 operating television 
broadcasting stations in the nation as of December 31, 
1997.105 For 1992,106 the number of television 
stations that produced less than $10.0 million in revenue was 1,155 
establishments.107 Only commercial stations are subject 
to regulatory fees.
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    \98\  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).
    \99\ 13 CFR 121.201, SIC code 4833.
    \100\ 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).
    \101\ 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.
    \102\ 1992 Census, Series UC92-S-1, at Appendix A-9.
    \103\ 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).
    \104\ FCC News Release No. 31327 (Jan. 13, 1993); 1992 Census, 
Series UC92-S-1, at Appendix A-9.
    \105\ FCC News Release, ``Broadcast Station Totals as of Dec. 
31, 1997.''
    \106\ 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.
    \107\ 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.108 A radio broadcasting 
station is an establishment primarily engaged in broadcasting aural 
programs by radio to the public.109 Included in this 
industry are commercial, religious, educational, and other radio 
stations.110 Radio broadcasting stations which primarily 
are engaged in radio broadcasting and which produce radio program 
materials are similarly included.111 However, radio 
stations which are separate establishments and are primarily engaged 
in producing radio program material are classified under another SIC 
number.112 The 1992 Census indicates that 96 percent 
(5,861 of 6,127) radio station establishments produced less than $5 
million in revenue in 1992.113 Official Commission 
records indicate that 11,334 individual radio stations were 
operating in 1992.114 As of December 31, 1997, Commission 
records indicate that 12,270 radio stations were operating, of which 
7,465 were FM stations.115 Only commercial stations are 
subject to regulatory fees.
---------------------------------------------------------------------------

    \108\ 13 CFR 121.201, SIC code 4832.
    \109\ 1992 Census, Series UC92-S-1, at Appendix A-9.
    \110\ Id.
    \111\ Id.
    \112\ Id.
    \113\ 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.
    \114\ FCC News Release, No. 31327 (Jan. 13, 1993).
    \115\ FCC News Release, ``Broadcast Station Totals as of 
December 31, 1997.''
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    34. Thus, the rules may affect approximately 1,558 full power 
television stations, approximately 1,200 of which are considered 
small businesses.116 Additionally,

[[Page 35847]]

the proposed rules will affect some 12,156 full power radio 
stations, approximately 11,670 of which are small 
businesses.117 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).118 Given the nature of this 
service, we will presume that all LPTV licensees qualify as small 
entities under the SBA definition.
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    \116\ 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.
    \117\ 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.
    \118\ FCC News Release, No. 7033 (Mar. 6, 1997).
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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.119 Thus, radio or television stations with 
fewer than five full-time employees are exempted from certain EEO 
reporting and record keeping requirements.120 We estimate 
that the total number of broadcast stations with 4 or fewer 
employees is approximately 4,239.121
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    \119\ 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, Pub. L. 102-366, 222(b)(1), 106 Stat. 999 (1992), as 
further amended by the Small Business Administration Reauthorization 
and Amendments Act of 1994, Pub. L. 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).
    \120\ 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 0rder 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.
    \121\ Compilation of 1994 Broadcast Station Annual Employment 
Reports (FCC Form B), Equal Opportunity Employment Branch, Mass 
Media Bureau, FCC.
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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. 122
---------------------------------------------------------------------------

    \122\  13 CFR 121.201, SIC code 4832.
---------------------------------------------------------------------------

    37. There are currently 2,720 FM translators and boosters, and 
4,952 TV translators.123 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.124
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    \123\ FCC News Release, Broadcast Station Totals as of December 
31, 1996, No. 71831 (Jan. 21, 1997).
    \124\ 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.125 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.126 This definition of a small entity in 
the context of MDS auctions has been approved by the 
SBA.127 These stations were licensed prior to 
implementation of Section 309(j) of the Communications Act of 1934, 
as amended.128 Licenses for new MDS facilities are now 
awarded to auction winners in Basic Trading Areas (BTAs) and BTA-
like areas.129 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.
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    \125\ For purposes of this item, MDS includes both the single 
channel Multipoint Distribution Service (MDS) and the Multichannel 
Multipoint Distribution Service (MMDS).
    \126\ 47 CFR 1.2110 (a)(1).
    \127\ 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).
    \128\ 47 U.S.C. 309(j).
    \129\ 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.
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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.130 According to the Bureau of the Census, only 
twelve radiotelephone firms from a total of 1,178 such firms which 
operated during 1992 had 1,000 or more employees.131 
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, 732 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.132 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 732 small cellular service carriers that may be affected by the 
rules, herein adopted.
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    \130\ 13 CFR 121.201, SIC code 4812.
    \131\ 1992 Census, Series UC92-S-1, at Table 5, SIC code 4812.
    \132\ Trends in Telephone Service, Table 19.3 (February 19, 
1999).
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    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

[[Page 35848]]

is a radiotelephone company employing no more than 1,500 
persons.133 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.134 
Therefore, if this general ratio continues in 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.
---------------------------------------------------------------------------

    \133\ 13 CFR 121.201, Standard Industrial Classification (SIC) 
code 4812.
    \134\ U.S. Bureau of the Census, U.S. Department of Commerce, 
1992 Census of Transportation, Communications, and Utilities, UC 92-
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.135 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.136 
The SBA has approved these definitions.137 An auction of 
Phase II licenses commenced on September 15, 1998, and closed on 
October 22, 1998.138 Nine hundred and eight (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.139 A re-auction of the remaining, unsold 
licenses is likely to take place during calendar year 1999.
---------------------------------------------------------------------------

    \135\ 220 MHz Third Report and Order, 12 FCC Rcd 10943, 11068-
70, at paras. 291-295 (1997).
    \136\ 220 MHz Third Report and Order, 12 FCC Rcd at 11068-69, 
para. 291.
    \137\ See Letter from A. Alvarez, Administrator, SBA, to D. 
Phythyon, Chief, Wireless Telecommunications Bureau, FCC (Jan. 6, 
1998).
    \138\ See generally Public Notice, ``220 MHz Service Auction 
Closes,'' Report No. WT 98-36 (Wireless Telecom. Bur. Oct. 23, 
1998).
    \139\ 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.140 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, 137 carriers reported that 
they were engaged in the provision of either paging or ``other 
mobile'' services, which are placed together in the 
data.141 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 137 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.
---------------------------------------------------------------------------

    \140\ 13 CFR 121.201, SIC code 4812.
    \141\ Trends in Telephone Service, Table 19.3 (February 19, 
1999).
---------------------------------------------------------------------------

    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,142 and the most recent 
Telecommunications Industry Revenue data shows that 23 carriers 
reported that they were engaged in the provision of SMR dispatching 
and ``other mobile'' services.143 Consequently, we 
estimate that there are fewer than 23 small mobile service carriers 
that may be affected by the rules, herein adopted.
---------------------------------------------------------------------------

    \142\  13 CFR 121.201, SIC code 4812.
    \143\ Trends in Telephone Service, Table 19.3 (February 19, 
1999).
---------------------------------------------------------------------------

    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.144 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.145 These 
regulations defining ``small entity'' in the context of broadband 
PCS auctions have been approved by the SBA.146 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.147 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.
---------------------------------------------------------------------------

    \144\ 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).
    \145\ 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).
    \146\ 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).
    \147\ 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 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.148 A significant subset of the Rural 
Radiotelephone Service is the Basic Exchange Telephone Radio Systems 
(BETRS).149 We will use the SBA's definition applicable 
to radiotelephone companies, i.e., an entity employing no more than 
1,500 persons.150 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.
---------------------------------------------------------------------------

    \148\ The service is defined in 47 CFR 22.99.
    \149\ BETRS is defined in 47 CFR 22.757 and 22.759.
    \150\ 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.151 Accordingly, we

[[Page 35849]]

will use the SBA's definition applicable to radiotelephone 
companies, i.e., an entity employing no more than 1,500 
persons.152 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.
---------------------------------------------------------------------------

    \151\ The service is defined in 47 CFR 22.99.
    \152\ 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.153 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.
---------------------------------------------------------------------------

    \153\ 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 154 
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.
---------------------------------------------------------------------------

    \154\ 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.155
---------------------------------------------------------------------------

    \155\ 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 11,600 will be subject 
to FY 1999 regulatory fees.
    56. Fixed Microwave Services. Microwave services include common 
carrier,156 private-operational fixed,157 and 
broadcast auxiliary radio services.158 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.159 We estimate, for this purpose, 
that all of the Fixed Microwave licensees (excluding broadcast 
auxiliary licensees) would qualify as small entities under the SBA 
definition for radiotelephone companies.
---------------------------------------------------------------------------

    \156\ 47 CFR 101 et seq. (formerly, part 21 of the Commission's 
Rules).
    \157\ 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.
    \158\ 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.
    \159\ 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.160 
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.161 All licensees in this category are 
exempt from the payment of regulatory fees.
---------------------------------------------------------------------------

    \160\ 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.
    \161\ 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).162 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.
---------------------------------------------------------------------------

    \162\ 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.163 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.
---------------------------------------------------------------------------

    \163\ This service is governed by subpart I of part 22 of the 
Commission's Rules. See 47 CFR 22.1001-22.1037.

---------------------------------------------------------------------------

[[Page 35850]]

    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.164 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.
---------------------------------------------------------------------------

    \164\ 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. 
Applicants who pay small fees in advance supply fee information as 
part of their application or by attaching FCC Form 159, where 
applicable.
    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.165 Until payment is 
received, no new or pending applications will be processed, and 
existing authorizations may be subject to rescission.166 
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 insurance guarantee if that person or entity 
fails to pay a delinquent debt owed to any federal 
agency.167 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.168
---------------------------------------------------------------------------

    \165\ 47 U.S.C. 1.1164(a).
    \166\ 47 U.S.C. 1.1164(c).
    \167\ Pub. L. 104-134, 110 Stat. 1321 (1996).
    \168\ 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.169 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.
---------------------------------------------------------------------------

    \169\ 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) 1999.170 We 
have sought comment on the proposed methodology for implementing 
these statutory requirements and any other potential impact of these 
proposals on small business entities.
---------------------------------------------------------------------------

    \170\ 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 we 
are adopting in this Report and Order 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 164, supra, and 
Attachment F of the Report and Order, infra.
    Report to Small Business Administration: The Commission will 
send a copy of this Report and Order, including a copy of the Final 
Regulatory Flexibility Analysis (FRFA), to the Chief Counsel for 
Advocacy of the Small Business Administration.
    Report to Congress: The Commission shall include a copy of this 
Final Regulatory Flexibility Analysis, along with the Report and 
Order, in a report to Congress pursuant to the Small Business 
Regulatory Enforcement Fairness Act of 1996, 5 U.S.C. 801(a)(1)(A). 
A copy of this FRFA and Report and Order (or summaries thereof) will 
also be published in the Federal Register.

Attachment B--Sources of Payment Unit Estimates for FY 1999

    In order to calculate individual service fees for FY 1999, we 
adjusted FY 1998 payment units for each service to more accurately 
reflect expected FY 1999 payment liabilities. We obtained our 
updated estimates through a variety of means. For example, we used 
Commission licensee data bases, actual prior year payment records 
and industry and trade association projections when available. We 
tried to obtain verification for these estimates from multiple 
sources and, in all cases, we compared FY 1999 estimates with actual 
FY 1998 payment units to ensure that our revised estimates were 
reasonable. Where it made sense, we adjusted and/or rounded our 
final estimates to take into consideration the fact that certain 
variables that impact on the number of payment units cannot yet be 
estimated exactly. These include an unknown number of waivers and/or 
exemptions that may occur in FY 1999 and the fact that, in many 
services, the number of actual licensees or station operators 
fluctuates from time to time due to economic, technical or other 
reasons. Therefore, when we note, for example, that our estimated FY 
1999 payment units are based on FY 1998 actual payment units, it 
does not necessarily mean that our FY 1999 projection is exactly the 
same number as FY 1998. It means that we have either rounded the FY 
1999 number

[[Page 35851]]

or adjusted it slightly to account for these variables.

------------------------------------------------------------------------
         Fee category              Sources of payment unit estimates
------------------------------------------------------------------------
Land Mobile (All), Microwave,  Based on Wireless Telecommunications
 IVDS (now 218-219 MHz Serv.)   Bureau (WTB) projections of new
 \171\, Marine (Ship &          applications and renewals taking into
 Coast), Aviation (Aircraft &   consideration existing Commission
 Ground), GMRS, Amateur         licensee data bases. Aviation (Aircraft)
 Vanity Call Signs, Domestic    and Marine (Ship) estimates have been
 Public Fixed.                  adjusted to take into consideration the
                                licensing of portions of these services
                                on a voluntary basis.
CMRS Mobile Services.........  Based on actual FY 1998 payment units
                                adjusted to take into consideration
                                industry estimates of growth between FY
                                1998 and FY 1999 and Wireless
                                Telecommunications Bureau projections of
                                new applications and average number of
                                mobile units associated with each
                                application.
CMRS Messaging Services......  Based on industry estimates of the number
                                of units in operation.
AM/FM Radio Stations.........  Based on actual FY 1998 payment units.
UHF/VHF Television Stations..  Based on actual FY 1998 payment units.
AM/FM/TV Construction Permits  Based on actual FY 1998 payment units.
LPTV, Translators and          Based on actual FY 1998 payment units.
 Boosters.
Auxiliaries..................  Based on actual FY 1998 payment units.
MDS/MMDS.....................  Based on actual FY 1998 payment units.
Cable Antenna Relay Service    Based on actual FY 1998 payment units.
 (CARS).
Cable Television System        Based on Cable Services Bureau and
 Subscribers.                   industry estimates of subscribership.
Interstate Telephone Service   Based on actual FY 1998 interstate
 Providers.                     revenues associated with contributions
                                to the Telecommunications Relay System
                                (TRS) Fund, adjusted to take into
                                consideration FY 1999 revenue growth in
                                this industry as estimated by the Common
                                Carrier Bureau.
Earth Stations...............  Based on actual FY 1998 payment units.
Space Stations (GSOs & NGSOs)  Based on International Bureau licensee
                                data bases.
International Bearer Circuits  Based on International Bureau estimate.
International HF Broadcast     Based on actual FY 1998 payment units.
 Stations, International
 Public Fixed Radio Service.
------------------------------------------------------------------------
\171\ After the NPRM was issued in this proceeding, the Wireless
  Telecommunications Bureau's staff advised that they anticipate
  receiving 513 renewal applications for IVDS in FY 1999. Therefore,
  there will be a regulatory fee in the 218-219 MHz Service (previously
  IVDS) category for FY 1999.

BILLING CODE 6712-01-P

[[Page 35852]]

[GRAPHIC] [TIFF OMITTED] TR01JY99.037



[[Page 35853]]

[GRAPHIC] [TIFF OMITTED] TR01JY99.038


BILLING CODE 6712-01-C

[[Page 35854]]

Attachment D--FY 1999 Schedule of Regulatory Fees

------------------------------------------------------------------------
                                                              Annual
                      Fee category                        regulatory fee
                                                             (U.S. $'s)
------------------------------------------------------------------------
PMRS (per license) (Formerly Land Mobile--Exclusive Use            13
 at 220-222 MHz, above 470 MHz, Base Station and SMRS)
 (47 CFR part 90).......................................
Microwave (per license) (47 CFR part 101)...............           13
218-219 MHz Service (per license) (47 CFR part 95)......           13
Marine (Ship) (per station) (47 CFR part 80)............            7
Marine (Coast) (per license) (47 CFR part 80)...........            7
General Mobile Radio Service (per license) (47 CFR part             7
 95)....................................................
Land Mobile (per license) (all stations not covered by              7
 PMRS and CMRS).........................................
Aviation (Aircraft) (per station) (47 CFR part 87)......            7
Aviation (Ground) (per license) (47 CFR part 87)........            7
Amateur Vanity Call Signs (per call sign) (47 CFR part              1.40
 97)....................................................
CMRS Mobile Services (per unit) (47 CFR parts 20, 22,                .32
 24, 80 and 90).........................................
CMRS Messaging Services (per unit) (47 CFR parts 20, 22              .04
 and 90)................................................
Multipoint Distribution Services (per call sign) (47 CFR          285
 part 21)...............................................
AM Radio Construction Permits...........................          260
FM Radio Construction Permits...........................          780
TV (47 CFR part 73) VHF Commercial:
    Markets 1-10........................................       41,225
    Markets 11-25.......................................       34,325
    Markets 26-50.......................................       23,475
    Markets 51-100......................................       13,150
    Remaining Markets...................................        3,400
    Construction Permits................................        2,775
TV (47 CFR part 73) UHF Commercial:
    Markets 1-10........................................       15,550
    Markets 11-25.......................................       11,775
    Markets 26-50.......................................        7,300
    Markets 51-100......................................        4,350
    Remaining Markets...................................        1,175
    Construction Permits................................        2,900
Satellite Television Stations (All Markets).............        1,300
Construction Permits--Satellite Television Stations.....          460
Low Power TV, TV/FM Translators & Boosters (47 CFR part           290
 74)....................................................
Broadcast Auxiliary (47 CFR part 74)....................           12
Cable Antenna Relay Service (47 CFR part 78)............           55
Cable Television Systems (per subscriber) (47 CFR part               .48
 76)....................................................
Interstate Telephone Service Providers (per revenue               121
 dollar)................................................
Earth Stations (47 CFR part 25).........................          180
Space Stations (per operational station in geostationary      130,550
 orbit) (47 CFR part 25) also includes Direct Broadcast
 Satellite Service (per operational station) (47 CFR
 part 100)..............................................
Space Stations (per operational system in non-                180,800
 geostationary orbit) (47 CFR part 25)..................
International Bearer Circuits (per active 64KB circuit).            7
International Public Fixed (per call sign) (47 CFR part           410
 23)....................................................
International (HF) Broadcast (47 CFR part 73)...........          520
------------------------------------------------------------------------


                                                              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
--------------------------------------------------------------------------------------------------------------------------------------------------------

Attachment E--Comparison Between FY 1998, FY 1999 Proposed and FY 1999 
Final Regulatory Fees

----------------------------------------------------------------------------------------------------------------
                                                       Annual regulatory   NPRM proposed fee   Annual regulatory
                    Fee category                          fee FY 1998           FY 1999           fee FY 1999
----------------------------------------------------------------------------------------------------------------
PMRS (per license) (Formerly Land Mobile-Exclusive             12                  13                  13
 Use at 220-222 Mhz, above 470 Mhz, Base Station and
 SMRS) (47 CFR part 90).............................

[[Page 35855]]

 
Microwave (per license) (47 CFR part 101)...........           12                  13                  13
218-219 MHz Service (per license) (47 CFR part 95)..          (1)                 (1)                  13
Marine (Ship) (per station) (47 CFR part 80)........            6                   7                   7
Marine (Coast) (per license) (47 CFR part 80).......            6                   7                   7
General Mobile Radio Service (per license) (47 CFR              6                   7                   7
 part 95)...........................................
Land Mobile (per license) (all stations not covered             6                   7                   7
 by PMRS and CMRS)..................................
Aviation (Aircraft) (per station) (47 CFR part 87)..            6                   7                   7
Aviation (Ground) (per license) (47 CFR part 87)....            6                   7                   7
Amateur Vanity Call Signs (per call sign) (47 CFR               1.30                1.42                1.40
 part 97)...........................................
CMRS Mobile Services (per unit) (47 CFR parts 20,                .29                 .32                 .32
 22, 24, 80 and 90).................................
CMRS Messaging Services [formerly One Way Paging]                .04                 .04                 .04
 (per unit) (47 CFR parts 20, 22, and 90)...........
Multipoint Distribution Services (per call sign) (47          260                 285                 285
 CFR part 21).......................................
AM Construction Permits.............................          235                 255                 260
FM Construction Permits.............................        1,150               1,250                 780
TV (47 CFR part 73) VHF Commercial:                   ..................  ..................  ..................
    Markets 1-10....................................       37,575              41,125              41,225
    Markets 11-25...................................       31,275              34,225              34,325
    Markets 26-50...................................       21,400              23,425              23,475
    Markets 51-100..................................       11,975              13,100              13,150
    Remaining Markets...............................        3,100               3,400               3,400
    Construction Permits............................        2,525               2,775               2,775
TV (47 CFR part 73) UHF Commercial:                   ..................  ..................  ..................
    Markets 1-10....................................       14,175              15,500              15,550
    Markets 11-25...................................       10,725              11,725              11,775
    Markets 26-50...................................        6,650               7,275               7,300
    Markets 51-100..................................        3,975               4,350               4,350
    Remaining Markets...............................        1,075               1,175               1,175
    Construction Permits............................        2,650               2,900               2,900
Satellite Television Stations (All Markets).........        1,175               1,275               1,300
Construction Permits--Satellite Television Stations.          420                 460                 460
Low Power TV, TV/FM Translators & Boosters (47 CFR            265                 290                 290
 part 74)...........................................
Broadcast Auxiliary (47 CFR part 74)................           11                  12                  12
Cable Antenna Relay Service (47 CFR part 78)........           50                  55                  55
Earth Stations (47 CFR part 25).....................          165                 180                 180
Cable Television Systems (per subscriber) (47 CFR                .44                 .48                 .48
 part 76)...........................................
Interstate Telephone Service Providers (per revenue              .0011               .0012               .00121
 dollar)............................................
Space Stations (per operational station in                119,000             130,225             130,550
 geostationary orbit) (47 CFR part 25) also includes
 Direct Broadcast Satellite Service (per operational
 station) (47 CFR part 100).........................
Space Stations (per operational system in non-            164,800             180,325             180,800
 geostationary orbit) (47 CFR part 25)..............
International Bearer Circuits (per active 64KB                  6                   7                   7
 circuit)...........................................
International Public Fixed (per call sign) (47 CFR            375                 410                 410
 part 23)...........................................
International (HF) Broadcast (47 CFR part 73).......          475                 520                520
----------------------------------------------------------------------------------------------------------------
\1\ No fee.


--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                           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................................................             400             300             200             250             300             400
20,001--50,000..........................................             750             600             300             400             600             750
50.001--125,000.........................................           1,250             800             400             600             800           1,250
125,001--400,000........................................           1,750           1,250             600             750           1,250           1,750
400,001--1,000,000......................................           2,500           2,000           1,000           1,250           2,000           2,500
>1,000,000..............................................           4,000           3,250           1,500           2,000           3,250           4,000
--------------------------------------------------------------------------------------------------------------------------------------------------------


                                                          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        8751,350
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
--------------------------------------------------------------------------------------------------------------------------------------------------------


[[Page 35856]]

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,172 as modified in the 
instant Report and Order. Where regulatory fee categories need 
interpretation or clarification, we have relied on the legislative 
history of section 9, and 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.173
---------------------------------------------------------------------------

    \172\ 47 U.S.C. 159(g)
    \173\ 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.174 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.
---------------------------------------------------------------------------

    \174\ 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).175 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.176 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.
---------------------------------------------------------------------------

    \175\ 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.
    \176\ 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 (now 218-219 MHz Service): The 
218-219 MHz Service 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 218-219 MHz Service 
provides information, products, and services, and also the 
capability to obtain responses from subscribers in a specific 
service area. The 218-219 MHz Service is offered on a private 
carrier basis. The Commission anticipates receiving 513 renewal 
applications for the 218-219 MHz Service during FY 1999. Therefore, 
for FY 1999, the regulatory fee for 218-219 MHz Service licensees 
will be $13 per renewal, payable for an entire five year term. The 
total regulatory fee due is $65 for the five year license term.

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 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

[[Page 35857]]

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.177 For FY 1999, 
Amateur Vanity Call Sign applicants will pay a $1.40 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 $14.00 per call sign for the ten-
year license term.
---------------------------------------------------------------------------

    \177\ 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); 
178 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.
---------------------------------------------------------------------------

    \178\ 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. In addition, for FY 1999, 
this category will also include small SMR systems authorized for use 
of less than 10 MHz of bandwidth. 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 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.179 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:
---------------------------------------------------------------------------

    \179\ 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
      Population served        AM class A    AM class B    AM class C    AM class D    FM classes    B, C, C1 &
                                                                                       A, B1 & C3        C2
----------------------------------------------------------------------------------------------------------------
<=20,000....................           430           325           225           275           325           430
20,001-50,000...............           825           650           325           450           650           825

[[Page 35858]]

 
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 
$260 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 
$780 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.............................................    $41,225
VHF Markets 11-25............................................     34,325
VHF Markets 26-50............................................     23,475
VHF Markets 51-100...........................................     13,150
VHF Remaining Markets........................................      3,400
UHF Markets 1-10.............................................     15,550
UHF Markets 11-25............................................     11,775
UHF Markets 26-50............................................      7,300
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 $1,300 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, 
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

[[Page 35859]]

subscriber.180 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, Appendix B 
at paragraph 31.
---------------------------------------------------------------------------

    \180\ 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.181 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 0.00121 to determine the appropriate fee for this 
category of service. Regulatees may want to use the following 
worksheet to determine their fee payment:
---------------------------------------------------------------------------

    \181\ 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................................                   0.00121
(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.182 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.
---------------------------------------------------------------------------

    \182\  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 $130,550 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 
$180,800 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:

[[Page 35860]]

    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 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
                                                              equivalent
                 Analog television channel                     64 kbps
                                                               circuits
                                                             size in MHz
------------------------------------------------------------------------
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.

Attachment G--Description of FCC Activities

    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.183
---------------------------------------------------------------------------

    \183\ 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.184 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.
---------------------------------------------------------------------------

    \184\ 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.185 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. Attachment I
---------------------------------------------------------------------------

    \185\ 47 U.S.C. 73.313.
---------------------------------------------------------------------------

Parties Filing Comments on the Notice of Inquiry

MCI WorldCom, Inc.
BellSouth Corporation
Paging Network, Inc.
American Mobile Telecommunications Association, Inc.
Small Business in Telecommunications
ARDIS Company
Personal Communications Industry Association
Industrial Telecommunications Association, Inc.
GE American Communications, Inc.

[[Page 35861]]

Space Imaging L.P.
Lockheed Martin Corporation
PanAmSat Corporation
Orbital Communications Corporation
L/Q Licensee, Inc.

Parties Filing Reply Comments on the Notice of Inquiry

BellSouth Corporation (Late Filed)
L/Q Licensee, Inc.
GE American Communications, Inc.
COMSAT Corporation
Loral Space & Communications Ltd.

Parties Filing Comments on the Notice of Proposed Rule Making

Rural Telecommunications Group (Oral Ex Parte)
Council of Independent Communications Suppliers
Satellite Industry Association
AirTouch Communications, Inc.
Cellular Telecommunications Industry Association
National Association of Broadcasters
Walt Disney Company
PanAmSat Corporation
GE American Communications, Inc.
BellSouth Corporation

Parties Filing Reply Comments on the Notice of Proposed Rule Making

PrimeCo Personal Communications, L.P.
GE American Communications, Inc.
COMSAT Corporation
Blooston, Mordkofsky, Jackson & Dickens
American Mobile Telecommunications Association, Inc. (also filed 
Oral Ex Parte)

Attachment J--AM and FM Radio Regulatory Fees

    The List of regulatory fees is available from the FCC Public 
Reference Room, CY-AT57, 445 12th St. SW, Washington DC 20554.

[FR Doc. 99-16584 Filed 6-30-99; 8:45 am]
BILLING CODE 6712-01-P