This proposed rule has been reviewed under USDA procedures established in accordance with Executive Order 12291 and Departmental Regulation No. 1512-1 and has been designated as “nonmajor.” It has been determined that this rule will not result in: (1) An annual effect on the economy of $100 million or more; (2) A major increase in costs or prices for consumers, individual industries, federal, state or local governments, or geographical regions; or (3) significant adverse effect or competition, employment, investment, productivity, innovation, or the ability of United States-based enterprises in domestic or export markets.

This rule has been determined to be not significant for purposes of Executive Order 12866. Therefore, it has not been reviewed by the Office of Management and Budget (OMB).

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

This rule contains no Federal mandates (under the regulatory provisions of Title II of the UMRA) for State and local governments or the private sector of $100 million or more in any one year. Therefore, this rule is not subject to the requirements of Sections 202 and 205 of the UMRA.

This proposed rule has been reviewed under Executive Order 12988, Civil Justice Reform. The rule is intended to have preemptive effect with respect to any State or local laws, regulations or policies which conflict with its provisions, or which would otherwise impede its full implementation. Prior to any judicial challenge to the provisions of this rule or the application of its provisions, all applicable administrative procedures must be exhausted.

Information collection requirements required by this rule are not required before the regulations may be effective. However, the 30-day public comment period and OMB approval under the provisions of 44 U.S.C. Chapter 35 are still required after the rule is published, and the Information Collection Package and request for approval will be submitted to OMB.

Pursuant to requirements set forth in the Regulatory Flexibility Act (RFA), the Administrator of the Agricultural Marketing Service (AMS) has determined that this action will not have a significant economic impact on a substantial number of small entities. The purpose of the RFA is to fit regulatory actions to the scale of business subject to such actions in order that small businesses will not be unduly or disproportionally burdened. The Small Business Administration (13 CFR 121.1) has defined small agricultural procedures as those having annual gross revenue for the last three years of less than $500,000, and small agricultural service firms are defined as those whose gross annual receipts are less than $5,000,000.

Because there is a preponderance of entities shipping fresh Russet potatoes that meet these gross revenue limitations it is anticipated that the majority of the program participants could be classified as small entities without substantial regulatory restriction. Therefore the provisions of the RFA are not applicable and no Regulatory Flexibility analysis is required.

This program is not subject to the provisions of Executive Order 12372, which requires intergovernmental consultation with state and local officials. See the Notice related to 7 CFR part 3015, subpart V published at 48 FR 29115 (June 24, 1983).

It has been determined that this rule does not have sufficient federalism implications to warrant the preparation of a Federalism Assessment. The provisions contained in this rule will not have a substantial direct effect on States or their political subdivisions or on the distribution of power and responsibilities among the various levels of government.

Clause (2) of section 32 of the Act of August 24, 1935, as amended (7 U.S.C. 612c) (“section 32”) authorizes the Secretary of Agriculture to “encourage the domestic consumption of such [agricultural] commodities of products by diverting them, by the payment of benefits or indemnities or by other means, from the normal channels of trade and commerce”. Section 32 also authorizes the Secretary to use section 32 funds “at such times, in such manner, and in such amounts as the Secretary of Agriculture finds will effectuate substantial accomplishment by any one or more of the purposes of this section”. Furthermore, “determinations by the Secretary as to what constitutes diversion, and what constitutes normal channels to trade and commerce, and what constitutes normal production for domestic consumption shall be final”.

According to crop storage reports, on March 1, 2001, all potatoes stored in 15 states were 17 percent above the stocks on March 1, 2000 (most recent data available). Storage reports for March 1, 2001, indicate that the production of russet potatoes is up 15 percent from a year earlier and up 9 percent from the prior record set in 1997. Based on these statistics and other market factors, the Secretary has determined that the russet potato 2000 crop is in surplus supply and that the domestic consumption of such potatoes will be encouraged by using section 32 funds to divert the russet potatoes from the normal channels of trade and commerce under a Russet Potato Diversion Program. This potato diversion program would encompass russet varieties of potatoes (except sweet potatoes) of U.S. Grade No. 2 (fairly clean) and U.S. Grade No. 2 Processing, including varieties commonly used for processing and table stock. Due to a need for expediency in implementing the Russet Potato Diversion Program and concern about undue delay in conducting environmental analysis and impact studies on composting, this program would be limited to charitable institutions, animal feed, ethanol production, and rendering nonmarketable disposal through spraying, disking and/or burial.

The price established for russet potatoes destined for charitable institutions, animal feed ethanol production and nonmarketable disposal through spraying, disking, and/or burial would cover all costs, including transportation.

For the reasons set forth in the preamble, it is proposed that Title 7 Chapter I be amended as follows:

1. In Subchapter D, Part 80 is revised to read as follows:

On February 27, 2001, FSIS published a proposed rule “Performance Standards for the Production of Processed Meat and Poultry Products” (66 FR 12590). In that document, the Agency proposed food safety performance standards applicable to all ready-to-eat (RTE) and all partially heat-treated meat and poultry products, as well as environmental testing requirements intended to reduce the incidence of Listeria monocytogenes in RTE meat and poultry products. FSIS also proposed to convert to performance standards the existing regulatory requirements for thermally-processed, commercially sterile (most often canned) meat and poultry products and to rescind certain requirements requiring the elimination of trichina from products that contain pork.

FSIS is holding a technical conference to facilitate the submission and discussion of scientific research and technological data relevant to these proposed regulations. In the proposal, FSIS identified additional needs for data that if addressed could strengthen the scientific foundation of any final action. It is extremely important that the regulations be based on sound science and common sense measures.

Selection of papers and presentations, as well as the forthcoming conference agenda, will ensure adequate discussion of all of the identified topics. FSIS also will try to accommodate presentations of relevant data not specifically requested in the proposal or below. FSIS requests that submissions for the technical conference concern scientific research and technological developments relevant to the proposed regulations, rather than merely be comment on the proposed regulations themselves. After FSIS has selected papers for presentation, it will make the technical conference agenda available on the Internet. At the public meeting also announced in the document, FSIS will provide information and accept public comments specific to the proposed regulations.

FSIS intends to divide the public meeting to receive comments on the proposed regulations into four three-hour sessions, organized as follows:

FSIS invites interested parties to make oral comments or presentations at the public meeting. Please register in advance with Ms. Mary Harris and submit a written copy of your comments to the FSIS Docket Room (See ADDRESSES above). FSIS may revise the above public meeting agenda, depending on interest expressed in the various proposed regulations. As with the final agenda for the Technical Conference, FSIS plans to publish the final agenda for the Public Meeting on the Internet.

Also, the National Advisory Committee on Microbiological Criteria for Foods (NACMCF) will meet on May 7, 2001. This meeting also is open to the public. FSIS invites Committee members to attend the technical conference and public meeting announced in this document.

FSIS is extending the comment period on the proposed regulations to provide ample opportunity for the public to comment on issues raised at the technical conference and public meeting.

FSIS proposed to require that each establishment that produces RTE meat and poultry products conduct testing of food contact surfaces to verify that its Sanitation SOPs are eliminating Listeria spp. from food contact surfaces, unless it has developed a CCP within its HACCP plan for the control of L. monocytogenes. FSIS is confident that will result in sanitation improvements that will lead to reductions in the contamination of RTE meat and poultry products by L. monocytogenes. However, FSIS is not aware of any research that correlates specific amounts or types of testing with specific remedial actions or reductions in contamination and welcomes the submission of any data. FSIS also requests comment as to whether other types of environmental testing, regular product testing, or some combination may be more effective in detecting L. monocytogenes contamination problems.

FSIS has proposed required frequencies of testing that ensure very minimal levels of regular testing based on establishment size. FSIS is aware of no research linking volume of production with the likelihood of product adulteration by L. monocytogenes, but considers it reasonable that insanitary establishments producing higher volumes of RTE meat and poultry products would be more likely to adulterate more product and thus pose more risk to the public health. As a result, FSIS has proposed a progressive series of testing frequencies intended to protect consumers from adulterated product. These testing frequencies also should minimize the costs of testing accrued by small business.

FSIS requests any data that could bear on adjustments to the proposed frequencies, suggest other testing frequencies, correlate contamination risk with volume of production, or indicate what types and frequencies of testing for L. monocytogenes are most effective in detecting insanitation and possible adulteration of RTE meat and poultry products. Also, FSIS requests data regarding the relationship between Listeria spp. and L. monocytogenes and how that relationship should affect any requirements. For example, does a food contact surface positive for Listeria spp. scientifically necessitate product testing and what would negative product test results mean?

FSIS also requests data regarding the costs and benefits of the proposed testing provisions, as well as other testing protocols. FSIS seeks any data correlating testing, reductions in establishment contamination, and consequent reductions in listeriosis that could be used to improve the Agency's cost/benefit analysis.

FSIS is proposing lethality performance standards for the pathogen Salmonella derived from the Nationwide Microbiological Baseline Data Collection Program. Using the positive samples in the baseline data, FSIS derived hypothetical worst case raw products and then determined the levels of pathogen reduction (lethality performance standards) that, if met, would render these worst case raw products ready-to-eat and unadulterated with a specific margin of safety. FSIS also translated the results of the application of the lethality performance standards into probabilities of remaining pathogens in finished RTE product. Consequently, an establishment that demonstrates that its incoming raw product is consistently less contaminated than the worst case could apply a lower lethality than proposed, as long as it achieves the corresponding probability of remaining pathogens in finished RTE product.

It is possible that better data are available for deriving hypothetical worst case products and corresponding performance standards. For the lethality requirements concerning Salmonella, FSIS is unaware of any human health risk assessments that could be used to correlate changes in the performance standards with changes in public health benefits. Higher or lower lethality performance standards may be necessary in all or specific processing contexts. FSIS specifically requests any data that would support requiring different lethality performance standards to achieve certain public health benefits.

The lethality performance standards for Salmonella already apply to numerous RTE meat and poultry products and FSIS believes that many establishments that produce RTE products not now subject to the proposed standards already meet them. It is likely, however, that some establishments will have to alter their processing methods to meet the proposed standards, i.e., to achieve higher levels of lethality in their RTE products. Further, manufacturers of RTE meat patties now only are required to comply with time/temperature regulations that yield a lesser level of lethality than what FSIS is proposing for all RTE meat products. FSIS requests information on the costs meat patty manufacturers and other establishments may accrue if required to meet the proposed lethality performance standards for RTE meat and poultry products.

FSIS also requests scientific information relative to the proposed lethality performance standards for E. coli O157:H7 in fermented RTE products that contain beef, especially information that indicates a different worst case and lethality performance standard for this pathogen may be warranted.

Also under the proposal, all RTE meat and poultry products, other than thermally processed, commercially sterile products, and all partially heat-treated products, must be processed so as to prevent multiplication of toxigenic microorganisms such as C. botulinum and to allow no more than 1-log 10 multiplication of C. perfringens within the product. Stabilization is commonly achieved by rapidly cooling product after cooking. It also can be achieved by the addition of a curing agent. These regulatory stabilization standards already apply to numerous RTE and partially-heat treated meat and poultry products.

Researchers have suggested to FSIS that there may be some inevitable growth of C. botulinum during a 1-log 10 relative growth of C. perfringens and, therefore, compliance with the proposed zero growth standard for C. botulinum could in fact effectively require establishments to meet a more restrictive standard than that for C. perfringens. FSIS requests comment and scientific data relative to whether the Agency should revise the existing and proposed stabilization performance standard for controlling these two pathogens, as well as data on corresponding public health benefits.

As mentioned above, FSIS welcomes the submission of papers and presentations on scientific and technical topics relevant to the proposed regulations, but not specifically mentioned above or in the proposal.

A notice of proposed rulemaking and notice of public hearing that appeared in the Federal Register on January 4, 2001 (66 FR 747), announced that a public hearing was scheduled for April 26, 2001, at 10 a.m., in room 4718 of the Internal Revenue Service Building, 1111 Constitution Avenue NW., Washington, DC 20408. The subject of the public hearing is proposed regulations under section 1502 of the Internal Revenue Code. The public comment period for these proposed regulations expired on April 4, 2001.

The notice of proposed rulemaking and notice of public hearing, instructed those interested in testifying at the public hearing to submit a request to speak and an outline of the topics to be addressed. As of April 9, 2001, no one has requested to speak. Therefore, the public hearing scheduled for April 26, 2001, is canceled.

We encourage you to participate in this rulemaking by submitting comments and related material. If you do so, please include your name and address, identify the docket number for this rulemaking (CGD05-01-001), indicate the specific section of this document to which each comment applies, and give the reason for each comment. Please submit all comments and related materials in an unbound format, no larger than 8 1/2 by 11 inches, suitable for copying. If you would like to know this reached us, please enclose a stamped self-addressed postcard or envelope. We will consider all comments and material received during the comment period. We may change this proposed rule in view of them.

We do not plan to hold a public meeting. But you may submit a request for a meeting by writing to the Commander (Aowb) at the address under ADDRESSES explaining why one would be beneficial. If we determine that one would aid this rulemaking, we would hold one at a time and place announced by a later notice in the Federal Register .

The Greydon Paul Drawbridge is owned and operated by the North Carolina Department of Transportation (NCDOT). The regulation at 33 CFR 117.822 requires the bridge to open on signal except that from 6 a.m. to 10 p.m., the draw shall open on signal for all vessels waiting to pass every hour on the hour, twenty minutes past the hour and forty minutes past the hour; except that on weekdays the bridge need not open at 7:40 a.m., 8:40 a.m., 4:40 p.m. and 5:40 p.m. From 10 p.m. to 6 a.m., the bridge shall open on signal.

The Graydon Paul Bridge is the connecting bridge between Beaufort and Morehead City, North Carolina on US 70. This is the only corridor into Beaufort without making a 3 hour commute around Carteret County. Eleven to twelve thousand vehicles pass over the bridge everyday. One mile south of the Greydon Paul Bridge on US 70 is the Morehead City US 70 Bridge, which is a fixed 65 ft vertical clearance bridge over the Atlantic Intracoastal Waterway (AICWW). It is a short waterway commute for boaters to go around through the AICWW by Morehead City back to Beaufort. Motorists do not have an alternate route traveling to and from Beaufort to Morehead City. When bridge lifts occur, traffic backs up periodically for six to seven miles. The current schedule of openings every twenty minutes does not allow the traffic congestion to clear the bridge before the next opening. During rush hour periods the situation is even further impacted due to peak traffic numbers of vehicles trying to cross the bridge. NCDOT proposes that by restricting openings to twice an hour and lengthening rush hour restrictions for peak traffic times on the bridge, vehicular traffic congestion on US Highway 70 will be reduced and highway safety will be increased. NCDOT provided statistical data which supports the extreme traffic counts for a two lane bridge along with the number of openings and vessels requiring openings. This data revealed that traffic counts are staying at a constant 11-12 thousand cars a day with peak traffic time being from 6:30 a.m. to 8 a.m. and 4:30 p.m. to 6 p.m. Monday through Friday. The waterway users (which are comprised of commercial and recreational users with a mast height of less than 65 feet; there are no vessels requiring more than 65 feet in vertical clearance) for this area were contacted by the Coast Guard and the majority agreed to bridge openings twice an hour and extended rush hour restrictions. There is an alternate waterway route around the Beaufort Bridge through the Route 70 Morehead City Bridge (which provides a fixed 65 ft vertical clearance to mariners). It adds 35-40 minutes in transit time to vessels to go around. Overall, the Coast Guard believes that this proposed rule will reduce motor vehicle traffic delays on the hour and half hour and congestion related to rush hour traffic entering and exiting the town of Beaufort, North Carolina, while still providing for the reasonable needs of navigation.

This proposed rule is not a “significant regulatory action” under section 3(f) of Executive Order 12866 and does not require an assessment of potential costs and benefits under section 6(a)(3) of that Order. The Office of Management and Budget has not reviewed it under that Order. It is not significant under the regulatory policies and procedures of the Department of Transportation (DOT) (44 FR 11040, February 26, 1979).

We expect the economic impact of this proposed rule to be so minimal that a full regulatory Evaluation under paragraph 10e of the regulatory policies and procedures of DOT is unnecessary.

We reached this conclusion based on the fact that the proposed changes will not impede maritime traffic transiting the bridge, but merely require mariners to plan their transits in accordance with the scheduled bridge openings, while still providing for the needs of the bridge owner.

Under the Regulatory Flexibility Act (5 U.S.C. 601-612), we consider whether this proposed rule would have a significant economic impact on a substantial number of small entities. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000.

The Coast Guard certifies under 5 U.S.C. 605(b) that this proposed rule would not have a significant economic impact on a substantial number of small entities. There are 15 waterborne companies (Charter and Fishing vessels) that transit through the Beaufort Channel Bridge. These companies were contacted and everyone within those agencies agreed to the proposed restrictions. Commercial waterway users have an alternate route around the Beaufort Channel Bridge will not have an adverse effect on these small entities due to their ability to time their transits through the bridge during the specified opening periods.

If you think your business, organization, or governmental jurisdiction qualifies as a small entity and that this rule would have a significant economic impact on it, please submit a comment (see ADDRESSES ) explaining why you think it qualifies and how and to what degree this rule would economically affect it.

Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this proposed rule so that they can better evaluate its effects on them and participate in the rulemaking. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please contact the Commander (Aowb), Fifth Coast Guard District, Federal Building, 4th Floor, 431 Crawford Street, Portsmouth, Virginia 23704-5004.

This proposed rule would call for no new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).

We have analyzed this proposed rule under Executive Order 13132 and have determined that this rule does not have implications for federalism under that order.

The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) governs the issuance of Federal regulations that require unfunded mandates. An unfunded mandate is a regulation that requires a State, local, or tribal government or the private sector to incur direct costs without the Federal Government's having first provided the funds to pay those costs. This proposed rule would not impose an unfunded mandate.

This proposed rule would not affect a taking of private property or otherwise have taking implications under Executive Order 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights.

This proposed rule meets applicable standards in Section 3(a) and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize litigation, eliminate ambiguity, and reduce burden.

We have analyzed this proposed rule under Executive Order 13045, Protection of Children from Environmental Health Risks and Safety Risks. This rule is not an economically significant rule and does not concern an environmental risk to health or risk to safety that may disproportionately affect children.

We considered the environmental impact of this proposed rule and concluded that, under figure 2-1, paragraph (32) (e), of Commandant Instruction M16475.1C, this proposed rule is categorically excluded from further environmental documentation. This proposed rule only deals with the operating schedule of an existing drawbridge and will have no impact on the environment. A “Categorical Exclusion Determination” is available in the docket where indicated under ADDRESSES.

For the reasons discussed in the preamble, the Coast Guard proposes to amend 33 CFR part 117 as follows:

This is a summary of the Notice of Proposed Rulemaking (“Notice”) in GN Docket No. 01-74, FCC 01-91, adopted March 16, 2001 and released March 28, 2001. The complete text of the document is available to the public on the Commission's Internet Home Page: http://www.fcc.gov (including at http://www.fcc.gov/Bureaus/Wireless/Orders/2001/fcc0191.pdf). The document is also available for public inspection and copying during normal business hours in the FCC Reference Information Center, 445 12th Street, S.W., Room CY-A257, Washington, D.C. and may be purchased from the Commission's copy contractor, International Transcription Services (“ITS, Inc.”), (202) 857-3800, 445 12th Street, S.W., CY-B400, Washington, D.C. 20554. This Notice may contain proposed information collection(s) subject to the Paperwork Reduction Act of 1995 (“PRA”). It has been submitted to the Office of Management and Budget (“OMB”) for review under the PRA. OMB, the general public, and other Federal agencies are invited to comment on the proposed information collection(s) contained in this proceeding.

This NPRM contains a proposed information collection. The Commission, as part of its continuing effort to reduce paperwork burdens, invites the general public and the Office of Management and Budget (OMB) to comment on the information collection(s) contained in this NPRM, as required by the Paperwork Reduction Act of 1995, Public Law 104-13. Public and agency comments are due at the same time as other comments on this NPRM; OMB notification of action is due June 12, 2001. Comments should address: (a) Whether the proposed collection of information is necessary for the proper performance of the functions of the Commission, including whether the information shall have practical utility; (b) the accuracy of the Commission's burden estimates; (c) ways to enhance the quality, utility, and clarity of the information collected; and (d) ways to minimize the burden of the collection of information on the respondents, including the use of automated collection techniques or other forms of information technology.

The Notice is part of the Commission's plan to reclaim the 698-746 MHz band (“698-746 MHz band” or “Lower 700 MHz Band”), currently used for television (“TV”) Channels 52-59, for new commercial services as part of the transition of TV broadcasting from analog to digital transmission systems, consistent with the statutory directives enacted in the Balanced Budget Act of 1997. The Notice consists of two parts. First, the Notice proposes to reallocate the 698-746 MHz band, currently used for TV Channels 52-59, from use solely for broadcast services to Fixed, Mobile, and Broadcast services. Second, the Notice proposes to adopt certain service, licensing, and competitive bidding rules for the 698-746 MHz band. The Notice proposes to reallocate the entire 48 megahertz of spectrum in the 698-746 MHz band to the fixed and mobile services, and retain the existing broadcast allocation. The Notice also seeks comment on whether the band should also be allocated for satellite services. This Notice also proposes to license the 698-746 MHz commercial band under a flexible framework established in part 27 of the Commission's rules. The Commission expects that provisions of part 27 will be modified to reflect the particular characteristics and circumstances of services offered through the use of spectrum on these bands. Depending on the extent and nature of provisions in the service rules that enable broadcast services, these modifications may also reference or incorporate rules in other parts of the Commission's rules, such as part 73 governing broadcast services. The flexible approach contained in the Notice will encourage new and innovative services and technologies in this band without significantly limiting the range of potential uses for this spectrum.

1. The Notice proposes to reallocate the 698-746 MHz spectrum band, currently comprising television (“TV”) Channels 52-59. The Commission is reclaiming this spectrum for new commercial services as part of the Commission's transition of TV broadcasting from analog to digital transmission systems. Digital television (“DTV”) technology is more spectrally efficient thus allowing the same amount of television service to operate in a reduced allocation, i.e., TV Channels 2-51, after the transition. The Notice proposes a co-primary allocation for the fixed, mobile, and broadcasting services for this 48 megahertz band. This flexible allocation will enable service providers to select the technology they wish to use to provide new broadband services in order to make the best use of this spectrum. The Notice also examines possible licensing, operating, and competitive bidding rules for wireless and other services in this spectrum band. The Notice anticipates that licenses will be assigned by competitive bidding consistent with statutory requirements. 1 The Notice also considers measures to protect the incumbent analog and digital broadcast television services from interference until the transition to digital television is complete. The Commission believes these measures will enable an orderly transition for broadcasters while permitting the introduction of new services into the band.

2. Section 309(j)(14) of the Communications Act of 1934, as amended (“Communications Act”) requires the Commission to assign spectrum recaptured from broadcast television as a result of the transition from analog to digital transmission systems by competitive bidding by September 30, 2002. 2 The statute requires that analog broadcasters cease operation on the recaptured spectrum in 2006 unless one or more of the four largest network stations or affiliates are not broadcasting in digital, digital-to-analog converter technology is not generally available, or 15% or more television households are not receiving a digital signal. Thus, while the end of the transition is targeted for 2006, and may extend beyond that date, the Commission must reallocate spectrum and assign commercial licenses in the encumbered television spectrum by September 30, 2002. New licensees may operate in the band prior to the end of the transition to the extent they do not cause interference to existing analog and digital broadcasters, see DTV Sixth Report and Order, 62 FR 26684, May 14, 1997.

3. Under section 309(j)(3) of the Communications Act, in developing a competitive bidding methodology and specifying the characteristics of licenses to be assigned by auction, the Commission are required to promote a number of objectives, including the development and rapid deployment of new technologies, products, and services for the benefit of the public, the promotion of economic opportunity and competition, the recovery of a portion of the value of the spectrum made available for commercial use, and the efficient and intensive use of the spectrum, in a manner that provides adequate time for interested parties to develop their business plans. 3 The Commission's regulations shall prescribe area designations and bandwidth assignments that promote (a) equitable distribution of licenses and services among geographic areas, (b) economic opportunity for a wide variety of applicants, including small businesses, rural telephone companies, and businesses owned by members of minority groups and women, and (c) investment in and rapid deployment of new technologies and services.

4. Section 303(y)(2) of the Communications Act authorizes the Commission to allocate spectrum to provide flexibility of use if certain conditions are met. Specifically, the Commission must make affirmative findings that such flexibility: (1) Is consistent with international agreements; (2) would be in the public interest; (3) would not deter investment in communications services and systems, or technology development; and (4) would not result in harmful interference among users.

5. Pursuant to legislative mandates, the Commission is requiring that the broadcast television service convert from the existing analog television transmission system to a new digital television system that will allow broadcasters the flexibility to provide a variety of new services, including high definition television service, multicasting of multiple programs, data services and other enhancements. Broadcasters have been provided a second channel to operate their DTV service during the transition from analog to digital service, see generally DTV Second MO&O of the Fifth and Sixth Report and Orders, 64 FR 4322, January 28, 1999; DTV MO&O of the Sixth Report and Order, 63 FR 13546, March 20, 1998; DTV MO&O of the Fifth Report and Order, 63 FR 15774, April 1, 1998; DTV Sixth Report and Order, DTV Fifth Report and Order, 62 FR 26966, May 16, 1997 (collectively DTV Proceeding ). At the end of this transition, analog service will cease and one of each broadcaster's two channels will be recovered. Because the DTV transmission system is more spectrally efficient than the analog system, less spectrum will be needed for broadcast television service after the transition. A portion of the TV spectrum, i.e., Channels 52-69, is therefore being recovered for new uses. Spectrum currently allocated to Channels 2-51 will remain “core” television broadcast spectrum. Analog services on all TV Channels will cease operations at the end of the transition. Digital services on out-of-core stations will be relocated into the core spectrum (Channels 2-51).

6. The Commission is addressing the spectrum reclamation in two parts—Channels 60-69 (“Upper 700 MHz Band” or “746-806 MHz band”) and Channels 52-59 (“Lower 700 MHz Band” or “698-746 MHz band”) primarily as a result of unique statutory requirements and varying degrees of incumbency. In ET Docket 97-157, the Commission reallocated the 746-806 MHz (TV Channels 60-69) band for new services. As required by statute, it reallocated 24 megahertz for public safety and 36 megahertz for new commercial services. The reallocation of the 698-746 MHz band (TV Channels 52-59) is addressed in this proceeding.

7. The Commission's framework for consideration of both allocation and service rules for the Lower 700 MHz Band is modeled on the approach taken in the Upper 700 MHz proceeding, see Upper 700 MHz Third Report and Order, 66 FR 10204, February 14, 2001; Upper 700 MHz Second MO&O, 66 FR 9035, February 6, 2001; Upper 700 MHz MO&O and FNPRM, 65 FR 42960, July 12, 2000; Upper 700 MHz Second Report and Order, 65 FR 17594, April 4, 2000; Upper 700 MHz First Report and Order, 65 FR 3139, January 20, 2000, corrected by 65 FR 12483, March 9, 2000; Upper 700 MHz NPRM, 64 FR 36642, July 7, 1999 (collectively Upper 700 MHz proceeding). The Commission seeks comment generally on whether the considerations that the Commission found to be appropriate for the 746-806 MHz bands are equally applicable to the Lower 700 MHz spectrum once it has been reallocated, or whether, given the differences in the two bands, the Commission should apply other approaches.

8. The Commission had anticipated, given the degree of incumbency, that this band likely would remain principally a television band until the end of the digital transition. However, given the statutory requirement to auction this spectrum several years in advance of the end of the transition, the Commission seeks comment generally on the reallocation plans and service rules necessary to license the spectrum consistent with the Congressional mandate. The Commission also seeks comment on whether the Commission should consider ways to facilitate the DTV transition and the availability of this band to auction bidders sooner. In making proposals, commenters should address consistency with the statutory requirements of section 309(j)(14) and other relevant provisions of the Communications Act.

9. Domestically, the 698-746 MHz band is currently allocated on a primary basis to non-government broadcasting, i.e., TV Channels 52-59, each having a bandwidth of six megahertz. TV broadcast services are also permitted to use TV subcarrier frequencies, and more generally the TV channel, on a secondary basis for other broadcast-related ( e.g., datacasting) and non-broadcast purposes. 4 Further, the band is allocated to the fixed service for subscription television operations in accordance with part 73 of the Commission's rules. 5 Internationally, the band is allocated worldwide on a primary basis to the broadcasting service. The band is also allocated to the fixed and mobile services in Region 2 (which includes the United States) on a secondary basis and in Region 3 on a co-primary basis. A footnote to the International Table of Frequency Allocations elevates the allocation to the fixed and mobile services to primary status in the United States, Mexico, and several other Region 2 countries, but has not been implemented domestically. 6

10. In its 1999 Spectrum Reallocation Policy Statement, the Commission noted that it planned to consider reallocating the 698-746 MHz band for Fixed, Mobile and new Broadcast services for commercial uses following the same approach it adopted for reallocating the 36 megahertz at 746-764 MHz and 776-794 MHz, see Spectrum Reallocation Policy Statement, FCC 99-354, 14 FCC Rcd 19868, November 22, 1999 (not published in Federal Register ). In the Commission's recently adopted 3G Notice on Advanced Fixed and Mobile Services, the 698-746 MHz band was identified as a possible candidate for third-generation (“3G”) mobile services, see 3G Notice of Proposed Rulemaking, 66 FR 7438, January 23, 2001 ( 3G Notice ). Further, a resolution adopted at World Radiocommunication Conference (“WRC”)-2000 recognized that some administrations may use the 698-746 MHz band for 3G services.

11. Consistent with the Commission's Spectrum Reallocation Policy Statement, the allocation for the 746-806 MHz band, and U.S. positions taken at WRC, the Commission proposes to reallocate the entire 48 megahertz of spectrum in the 698-746 MHz band to the fixed and mobile services, and retain the existing broadcast allocation. This allocation will support a family of services, including next generation broadband operations, and permit the maximum diversity in service offerings and the broadest licensee discretion, consistent with international allocations. The Commission requests comment on whether this broad allocation is appropriate, or whether some other allocation would better serve the public interest. The Commission also seeks comment with respect to each of the findings required under section 303(y) of the Communications Act with respect to the Commission's proposed allocation of the 698-746 MHz band.

12. The DTV transition plan anticipates that broadcasters will vacate this spectrum by the end of the DTV transition period. For this reason, the Commission would distinguish between broadcasters authorized pursuant to the current allocation and service rules from new licensees who may provide broadcasting service. New licensees will be subject to the rules the Commission will adopt for the regulation of the reallocated spectrum. Broadcasters authorized under the current rules are entitled to protection or accommodation from new licensees and will have to vacate this spectrum by the end of the transition period.

13. At the end of the transition, television broadcasting will remain adjacent to the 698-746 MHz band on channel 51. While the Commission will consider issues such as field strength limitations in the Commission's service rules, the Commission seeks comment on whether restrictions to the allocation are necessary to protect adjacent channel broadcast television operations. Comments should address whether fixed services may be more successful than mobile services in structuring their systems to avoid interference with incumbent broadcasters, and thus be able to use the spectrum more efficiently. The Commission is also concerned about the effects of adjacent channel television broadcasting on low power mobile operations in the 698-746 MHz band, for example mobile receive antennas. The Commission seeks comment on whether the Commission should adjust the Commission's allocation to perhaps minimize the presence of systems with low immunity to high-powered signals.

14. The low power television (“LPTV”) service currently operates on a secondary basis in the 698-746 MHz band. Thus, LPTV stations are allowed to operate to the extent they do not interfere with full power stations. In the Commission's DTV Proceeding, the Commission determined that there is insufficient spectrum to preserve all existing LPTV and TV translator stations, and decided that LPTV and TV translator stations will retain their secondary allocation status. In the 746-806 MHz proceeding, the Commission permitted continuing operations on a secondary basis for existing low power services in that band. The Commission believes that low power television should be permitted to continue to operate on the 698-746 MHz band on a secondary basis. Accordingly, the Commission proposed that LPTV and TV translator stations not be permitted to cause harmful interference to stations of primary services, including new licensees in Channels 52-59, and cannot claim protection from harmful interference from stations of primary services, including new licensees in Channels 52-59. However, as set forth in the DTV Sixth Report and Order, the Commission proposed that LPTV and TV translator operations will not be required to alter or cease their operations until they actually cause interference to a DTV station or new service provider's operations in the 698-746 MHz band. Further, as the Commission did in the 746-806 MHz band, the Commission proposed that LPTV stations be permitted to negotiate interference agreements with new service providers, see Upper 700 MHz Reallocation Order, 63 FR 63798, November 17, 1998. Although the Commission recognized that LPTV and TV translator stations retain this secondary status, the Commission seeks comment on these proposals and any additional considerations that might mitigate the impact on low power operations on Channels 52-59 during the transition period.

15. While the Commission is not making a specific proposal at this time concerning an allocation in this band for satellite services, the Commission seeks comment on this issue. The Commission seeks comment on whether satellite operations are technically feasible in this band. In addition, while the BBA 97 requires that the Commission assign spectrum reclaimed from broadcasters as a result of the digital transition by competitive bidding, subsequently-enacted legislation restricts the use of competitive bidding to license spectrum used for the provision of certain international satellite services. 7 The Commission seeks comment on whether these statutory provisions would affect the Commission's ability to allocate spectrum for flexible uses that would include the ability to deploy satellite services, subject to appropriate interference and other technical limitations, Cf. 3650-3700 MHz First Report and Order, 65 FR 69612, November 17, 2000.

16. Incumbent broadcasters may remain on the 698-746 MHz band until the end of the digital transition targeted for 2006. The significant degree of incumbency will pose considerable challenges to the provision of viable new commercial services prior to the end of the transition. The Commission seeks comment generally on how the Commission can further the viability of auction of this spectrum consistent with the Commission's statutory obligations and sound principles of spectrum management.

17. Currently, there are 89 licensed full service NTSC analog stations and 12 approved analog construction permits on the 698-746 MHz band. For the 746-806 MHz band, the Commission concluded that stations for which a construction permit has been granted are sufficiently far enough along the licensing process that they should be treated the same as operating TV stations and receive protection from new service providers during the DTV transition period. The Commission has established a three-year construction requirement to ensure that holders of construction permits, both for new facilities and modification of existing facilities, progress in construction. 8 The Commission proposes to treat construction permits in the 698-746 MHz band in the same manner the Commission adopted in the 746-806 MHz band and seeks comment on this proposal.

18. In the DTV Sixth Further Notice of Proposed Rulemaking, 61 FR 43209, August 21, 1996, in order to accommodate parties who were in the process of preparing applications, the Commission established a final opportunity for the filing of new applications for analog stations for vacant allotments. Applications could be submitted during this filing window for (1) amendments (other than channel changes) to pending applications for new full-service NTSC television stations on Channel 2-59, (2) petitions for rule making seeking a new channel below Channel 60 for those applicants with pending applications for new full-service NTSC television stations on Channels 60-69, (3) petitions for rule making seeking a new channel below channel 60 for those applicants with pending applications for new full-service NTSC television stations on Channels 2-59 at locations inside of the “TV Freeze Areas” and (4) amendments to pending rule making petitions to amend the TV Table of Allotments to add NTSC television allotments, see Analog TV Filing Public Notice (DA 99-2605), 64 FR 67267, December 1, 1999 (Analog TV Filing Public Notice).

19. There are pending requests for approximately 57 new NTSC stations in this band, either with applications or allotment petitions originally filed during the filing windows established by the Commission. Some of the requests have been pending on these channels since they were filed, while others were amended to specify a channel in this band under procedures announced in the Analog TV Filing Public Notice. Previously, those new station proposals had been for stations on Channels 2 through 59 at locations where they would have conflicted with one or more DTV allotments or for use of TV Channels 60 through 69. The Commission recognizes that those persons with pending applications and/or petitions for new full-service NTSC television stations on those channels had already invested time, money and effort into their applications and petitions. Therefore, the Commission stated that it would not summarily terminate the pending applications and petitions, and it would, at a later date, provide applicants and petitioners an opportunity to amend their applications and petitions, if possible, to a channel below Channel 60.

20. The Commission recognizes that continuing to process these applications could result in greater incumbency on the 698-746 MHz band, which may make new service operations more difficult. This band was originally intended to remain principally a television band until the end of the transition and the Commission recognizes that it may be inequitable not to process these applications, or a subset of them. In addition, given the significant number of analog and DTV incumbents that already exist on this band, the impact on the provision of new services may be marginal. Therefore, while the Commission is not directing the Mass Media Bureau to suspend processing of applications (with the exception of stations on Channel 59) for new analog stations, the Commission seeks comment on the Commission's ultimate treatment of the remaining pending applications. For example, the Commission seeks comment on whether there are stronger equities for continuing to process any particular subcategory of these pending applications. In addition, if such applications are granted, the Commission seeks comment on whether the Commission could require these stations to transition to available frequencies below 698 MHz by a date certain, i.e., 2006, to ensure that these stations do not encumber the provision of new services. The Commission particularly seeks comment on whether such a requirement would be consistent with the Commission's statutory requirements in section 309(j)(14) of the Communications Act. The Commission also seeks comment on whether these applicants (or a particular subset thereof) should be allowed to amend their pending applications through a channel allotment rule making petition to specify a new digital channel in the core that may become available later. With regard to applications pending for stations on Channel 59, the Commission believes that granting more analog station licenses could impact the licensing of new services in the Upper 700 MHz Band due to adjacent channel interference problems. Therefore, for the pendency of this rulemaking proceeding, the Commission directs the Mass Media Bureau to suspend processing of applications and channel allotment petitions for new analog stations on Channel 59, but to allow limited amendments to specify another channel, if available.

21. Because the Commission was unable to accommodate a second digital channel for all broadcasters within the “core” broadcast spectrum, there are a substantial number of digital channels on Channels 52-59 as well. While the planning for the DTV Table of Allotments sought to minimize use of out-of-core channels, it was necessary to make allotments outside this range, particularly in the most congested areas of the country. Thus, there are 165 DTV assignments on Channels 52-59 (includes licenses, construction permits, and pending applications). Also pending, are four DTV allotment petitions filed by entities that originally proposed NTSC operations. While there are roughly the same number of analog stations on Channels 52-59 as there are on Channels 60-69, there are significantly more digital television incumbents. In particular, there are only 20 digital assignments on Channels 60-69 compared to the 165 assignments on Channels 52-59 and this number may increase.

22. There are currently 835 licenses and 244 construction permits for low power television operations on Channels 52-59. In addition, there are 607 applications pending for new low power stations. Many of these pending applications involve requests for replacement channels by low power stations displaced by DTV stations or seeking to vacate the use of TV Channels 60-69 (746-806 MHz). Section 3004 of the BBA 97 states that anyone holding a television broadcast license in the 746-806 MHz band “may not operate at that frequency after the date on which the digital television transition period terminates, as determined by the Commission.” In the Commission's reallocation proceeding for Channels 60-69, the Commission found that this provision leaves us no latitude in clearing LPTV and TV translator stations from the band at the end of the DTV transition period. Throughout the DTV and related proceedings, the Commission has recognized that the DTV transition and the reallocation of spectrum to other services will have a significant impact on LPTV and TV translators. Further, the Commission has recognized that LPTV operators offer important services to specialized and minority audiences, foreign language communities, and rural areas. In this regard, the Commission adopted a number of rule changes in the DTV Proceeding to mitigate the impact on these stations. The Commission seeks comment on whether there are additional measures the Commission should consider for LPTV in the 698-746 MHz band.

23. In the DTV Proceeding, the Commission stated that all existing analog TV and new DTV stations in the 698-746 MHz band would be fully protected during the DTV transition period. Thus, it will be necessary for licensees in the reallocated spectrum to protect both analog TV and DTV stations in the 698-746 MHz band from interference. If any additional NTSC licenses or construction permits or DTV full service allotments are made as a result of pending petitions, they would be afforded full protection during the DTV transition period.

24. For the 746-806 MHz (Channels 60-69) band, the Commission adopted a methodology that specifies minimum separation distances based on the various heights and powers of land mobile stations to prevent harmful interference to incumbent analog television operations from new service providers. This methodology has been successfully used in existing land mobile-broadcasting sharing arrangements in the 470-512 MHz band. The Commission used a 40 dB desired-to-undesired (D/U) signal ratio for calculating the co-channel geographic separation requirements, see Public Safety Service Rule First Report and Order and Third Notice of Proposed Rulemaking, 63 FR 58645, November 2, 1998, 63 FR 58685, November 2, 1998 (Public Safety Service Rule Order). The Commission found this to be a reasonable value that will provide sufficient protection for TV stations, as prescribed by the BBA 97. Co-channel land mobile base station transmitters will be limited to a maximum signal strength at the assumed TV Grade B contour that is 40 dB below the 64 dBu Grade B contour signal strength value, or 24 dBu. The Commission adopted a 0 dB D/U signal ratio for adjacent channel operations. Adjacent channel land mobile transmitters are thus limited to a maximum signal which can equal the TV Grade B signal of 64 dBu at the TV station assumed Grade B contour of 88.5 km (55 miles). A typical TV receiver's adjacent channel rejection is at least 10-20 dB, which will further safeguard TV from land mobile interference. The analog TV protections adopted in the 746-806 MHz reallocation proceeding were based on the need to balance protection for existing broadcasting services, while making this spectrum viable for new services, including public safety. The Commission seeks comment on whether the Commission should employ the same method for protecting analog TV stations in the 698-746 MHz band.

25. In the Commission's public safety proceeding, the Commission determined that the same signal strength limits for land mobile operation criteria used for protection of analog stations, i.e. , 24 dBμ co-channel and 64 dBμ adjacent channel, should also apply for digital stations. These field strength values correspond to co-channel and adjacent channel protection ratios for a DTV station at its 41 dBμ field strength service contour of 17 dB and−23 dB, respectively. The Commission notes that these determinations are consistent with the DTV Sixth Report and Order . There, the Commission specified a minimum geographic separation of 250 km (155 miles) for co-channel operations between DTV stations and the city-center in the areas where there are existing land mobile operations. Section 90.305(a) of the Commission's rules provides that full power land mobile base stations can be located up to 80.5 km (50 miles) from the city-center of one of the specified cities. 10 Consequently, under the geographic separation standards adopted in the DTV Sixth Report and Order , a land mobile base station could choose to locate its station as close as 169.5 km (250 km−80.5 km), or 105 miles to a neighboring DTV station. At this distance, a typical land mobile base station would produce an interfering signal at the DTV station's 88.5 km (55 miles) equivalent Grade B contour corresponding to the 17 dB D/U protection ratio specified in the Public Safety Service Rule Order to a DTV receiver. Thus, the Commission's decision to require land mobile systems to provide signal ratios for DTV stations which will afford approximately the same separation distance as the Commission did for analog TV stations, was considered to represent a reasonable balance between the needs of both DTV stations and new services.

26. With regard to this new allocation of the 698-746 MHz band, the Commission seeks comment on whether to adopt the same criteria for protection of DTV stations as the Commission used for protection of analog stations. The Commission is particularly interested in comments addressing the provisions for transmissions that may have the characteristics of a wide band-noise like emission. As demonstrated by the table in § 73.623(c)(3)(ii), DTV receivers treat co-channel DTV signals as an increase in the noise floor of the desired signal. This increase in noise floor is proportional to the power received from the undesired station. Therefore, in order to maintain the minimum necessary signal-to-noise (S/N) ratio of 15.19 dB, the desired signal level must be increased. Section 73.623(c)(2) of the rules sets forth a value of 15 dB for co-channel interference for DTV into DTV which are only valid at receiving locations where the S/N ratio for the desired DTV signal is 28 dB or greater. 11 At the edge of the DTV noise-limited service area, where the S/N ratio is 16 dB, the value of D/U is 23 dB for interference protection from another DTV station. New land mobile systems operating in this band employing wide band noise like signals may need to provide DTV stations the same increases in protection as indicated in § 73.623(c)(3)(ii) of the rules. 12

27. Since the Commission does not know the characteristics (bandwidth and power spectrum shape) of the co-channel threat to DTV in the re-allocated Channels 52-59, the Commission seeks comment on whether digital, wide-band emissions from these services in this band could cause interference to possible co-channel DTV operations, and may require the imposition of more restrictive criteria than those provided for under § 90.545 of the Commission's rules. In particular, the Commission seeks comment on the adequacy of 17 dB for co-channel protection of DTV from wide band transmissions or whether the Commission should consider more conservative protection levels.

28. The United States has bilateral agreements with both Canada and Mexico setting forth allotment and assignment plans for TV broadcast stations covering the 698-746 MHz band (Channels 52-59). While the U.S. has identified this band for reallocation to new services, neither Canada nor Mexico has done so to date. 13 Pursuant to these agreements, the U.S. must protect the signals of Canadian and Mexican TV broadcast stations located in the border areas, and such operations will therefore affect U.S. non-broadcast use and services in this band. Accordingly, the Commission tentatively concludes that licenses issued for this band will be subject to whatever future agreements the United States develops with these two countries. The Commission further tentatively conclude that, until such time as existing agreements are replaced or modified to reflect the new uses, licenses in this band will be subject to existing agreements and the condition that harmful interference not be caused to, and must be accepted from, TV operations originating in Canada and Mexico. The Commission seeks comment on the Commission's tentative conclusions.

29. One of the primary goals in this proceeding is to establish service rules that will promote innovative services and encourage the flexible and efficient use of this spectrum. In recent years the Commission has implemented the statutory directives under section 309(j) of the Communications Act by addressing the growing complexities of spectrum management using approaches consistent with general market-based principles. Consistent with the principles underlying the Spectrum Reallocation Policy Statement and the Secondary Markets Policy Statement , 65 FR 80367, December 21, 2000, the Commission tentatively concludes that the service rules for this band should implement flexible use for the full range of proposed allocated services, consistent with necessary interference requirements.

30. In seeking to achieve the above objectives, the Commission recognizes that the service rules must also take into account the presence of incumbent broadcasters on the Lower 700 MHz Band and the processes established in the DTV proceeding for relocating incumbent broadcasters into the DTV core spectrum. The 698-746 MHz band is currently used as Channels 52-59 by a significant number of existing full service analog stations, LPTV stations, TV translator and booster stations, and by new DTV stations. These incumbent broadcasters, both analog and digital, may continue to operate on channel allotments in this band until at least December 31, 2006, 14 or the relevant statutory conditions are met that allow incumbents to be relocated to channels in the DTV core spectrum of Channels 2-51. Therefore, the service rules for any new services on the Lower 700 MHz Band must provide for the protection of incumbent television stations during the DTV transition period.

31. The Commission also seeks to establish rules that will facilitate, rather than hinder, the clearing of incumbent broadcasters from this spectrum in a manner consistent with the policy goal of locating all television channels in the DTV core spectrum, thus making the band available for a wide range of advanced services. While the Commission recognizes that different circumstances apply to the Lower 700 MHz Band, the Commission seeks comment on potential mechanisms, with the focus on voluntary mechanisms, to encourage the smooth transition from incumbent broadcast services to new services due to the particular circumstances relating to the Lower 700 MHz Band.

32. The Commission requests comment on a number of issues, such as the appropriate relationship between potential uses of the spectrum, the optimal size of the spectrum blocks available for auction, the appropriate size of geographic service areas, any channelization plan, and other characteristics that it should use to define licenses in the Lower 700 MHz Band. Comments should address whether particular characteristics would encourage a variety of technologies and entrants, foster overall licensee flexibility, provide licensees with the maximum number of options to provide service, and promote the other objectives of the Communications Act. In addition, if the Commission was to adopt allocations other than those proposed in this Notice, the Commission seeks comment on whether the service rules should provide for all allocated services including, for example, satellite service.

33. While the Commission seeks comment from the public in general concerning the matters set forth in the Notice, comment is specifically sought from Indian Tribal governments on the matters contained in the Notice. In keeping with the principles of the Tribal Government Policy Statement , 65 FR 41668, July 6, 2000, the Commission welcomes the opportunity to consult with Tribal governments on the issues raised by the Notice and seeks comment both from Tribal governments and other interested parties on the potential for the spectrum considerations set forth herein to serve the communications needs of tribal communities.

34. The Commission seeks comment on the scope of services that should be licensed under the service rules adopted for the Lower 700 MHz Band. Comments that are submitted in response to the Notice should address whether the service rules would encourage the active and efficient use of the Lower 700 MHz Band and enable new technologies and services.

35. The Commission emphasizes its continued interest in the development of a variety of mechanisms to make spectrum markets more flexible and efficient in the choice of service to be offered by licensees and in the applicable service rules. The Commission seeks comment on whether to reallocate this spectrum in the 698-746 MHz band to permit fixed, mobile, and broadcast services on the 698-746 MHz band. The Commission seeks to develop service rules that are not based on its prediction of how these bands will ultimately be used, but instead enables the Commission to establish maximum practicable flexibility. Accordingly, the Commission requests comment on how innovative service rules and assignment mechanisms can maximize the use of this spectrum. The Commission also seeks comment on how new technologies may affect the extent to which service rules effectively provide for flexible, efficient, and intensive use of the spectrum. 15

36. In the Upper 700 MHz First Report and Order, The Commission decided not to adopt service rules that would permit both full power television and wireless services to operate on the Upper 700 MHz Band. The Commission found that the contrasting technical characteristics of full power television broadcasting, using power levels authorized by part 73, 16 and wireless services effectively preclude the development of interference rules that would enable the practicable provision of both sets of services on the spectrum under consideration in that proceeding. In the Notice, the Commission solicits comment on the extent to which the service rules can permit both new full power broadcasting, in particular DTV and other digital broadcast operations, and wireless services to operate on the Lower 700 MHz Band. Commenters should consider the interference concerns that were addressed in the Upper 700 MHz proceeding, as well as any other relevant factors. The Commission seeks comment on whether the possible technology or technologies used to provide digital broadcast services, such as those using a cellular architecture, would be compatible with wireless services operating on the spectrum. In that regard, the Commission seeks comment on whether a 50 kW limit for full power broadcasting would permit both broadcasting operations and wireless services to use this spectrum, yet still allow flexible use of the spectrum consistent with technical and interference requirements. The Commission also requests comment on whether service rules that allow licensing of full power broadcasting on the band would affect the efficient use of the spectrum. To what extent would efforts to manage interference between such dissimilar transmissions as full power television and wireless services increase the possibility of substantial spectrum inefficiencies in the band? The Commission also seeks comment on whether the licensing of full power broadcasters on this band would impose disproportionate, offsetting burdens on wireless services, both fixed and mobile, and whether full power broadcasting would have a substantial impact on the technical effectiveness and economic practicability of wireless service providers operating on this band. In addition, the Commission seeks comment on whether any differences between the part 27 and part 73 rules that may affect the determination as to whether the service rules for the 698-746 MHz band should permit both full power television and wireless providers to operate on this band. The Commission notes that sections 309(j)(14)(C) and (D) of the Act, which apply to all spectrum reclaimed as part of the DTV transition, prevents the Commission from declaring any party ineligible, for “any license that may be used for any digital television service” in certain cities, on the basis of the duopoly rule and newspaper cross-ownership rule. 17 The Commission seeks comment on the impact of these provisions on the determination of whether and how the service rules can and should permit broadcast and wireless providers to operate on the Lower 700 MHz Band.

37. In the Upper 700 MHz First Report and Order, the Commission adopted service rules that addressed the need for a range of wireless applications and recast the part 27 rules to reflect their revised scope. The Commission decided to allow any new broadcast-type services consistent with the Table of Allocations, provided that such services satisfied the technical and service rules. The Commission seeks comment on whether to license new broadcast-type service on the Lower 700 MHz Band.

38. The Notice does not make a specific proposal concerning an allocation in the Lower 700 MHz Band for satellite service, but requests comment on the matter. In the event that an allocation is made in this band for satellite service, the Commission seeks comment on whether auction winners should be afforded the flexibility to deploy satellite services, either themselves or by agreement with a satellite operator, within their licenses' geographic area, provided that such operations do not cause unacceptable interference to services operating in adjacent geographic areas. Further, if an allocation is made in this band for satellite service, the Commission seeks comment on the service rules that would apply to such service.

39. The Commission seeks comment on the appropriate amount of spectrum for each license in the 698-746 MHz band. Should the Commission license, for example, the spectrum as a single 48 megahertz block or should it be licensed as two or more smaller blocks?

40. The Commission seeks comment first on whether the utility, and therefore value, of the spectrum would be enhanced by providing for the auction of a single block. A spectrum block of such size would seem to minimize the potential for third-party interference and thereby minimize the needed scope of the interference rules. In this regard, given the difficult incumbency issues associated with this band, the Commission seeks comment on whether economics associated with being a licensee of a large block of spectrum would make it easier for the licensee to develop services around existing incumbents, clear the band of incumbents, and generally deal with interference issues in the band. The Commission also requests comment on whether a single licensee, as opposed to numerous licensees, would be more likely to successfully negotiate the clearing of incumbent broadcasters from the spectrum. Would it be in the public interest to leave the determination of the internal framework of the 698-746 MHz band to one licensee? Comments should address both the possible and expected scope of use by a single 48 megahertz licensee. Commenters should identify the range of services that could be offered if the Commission employs a license of this size. In addition, the Commission seeks comment on what spectrum block size would best facilitate the “reasonable and timely”  18 deployment of broadband applications which may be spectrum-intensive.

41. The Commission seeks comment, alternatively, on whether to establish two or more blocks to license this spectrum, and what should be their size. The Commission seeks comment, for instance, on whether the spectrum should be licensed in two blocks of 24 megahertz each. Commenters also should address whether a block of 12 megahertz or more is required to provide access to a wide range of advanced telecommunications services. In addition, they should explain whether a block of six megahertz is necessary to enable wireless telecommunications services, or a viable digital television service. Licensing based on smaller spectrum blocks may be preferable for rural and small carriers. Parties who prefer smaller spectrum block sizes to larger blocks should identify the advantages that licensing based on smaller spectrum blocks would have on potential auction participants. If commenters support licensing based on spectrum blocks other than those discussed herein, they should state why other size spectrum blocks are more appropriate. The comments also should address the impact that the size of the spectrum blocks will have on the services that may be provided on this band, especially given the difficult incumbency issues.

42. Comments are invited on whether to adopt a licensing plan for this band that provides for different sized blocks. The comments should address whether this approach could improve spectrum efficiency, offer greater flexibility in the use of spectrum, increase the diversity of services offered to consumers, and facilitate the development of advanced telecommunications services.

43. The Commission also seeks comment generally on the minimum size of spectrum blocks needed to enable competitive commercial services. In this regard, the Commission notes that the simultaneous multiple round and combinatorial (or “package”) auction design generally offers bidders substantial flexibility to aggregate blocks of spectrum for their particular uses. The Commission seeks comment on whether in light of the auction designs that may be available, the Commission should define spectrum block sizes that would require bidders to aggregate spectrum at auction to achieve the most efficient result. Such an approach may provide bidders with greater flexibility to implement their plans, as compared with the Commission's traditional approach toward defining spectrum blocks, which attempts to define optimal block size and allows adjustments through secondary market mechanisms, such as disaggregation, if such fine-tuning is necessary.

44. Commenters should consider the relationship between the amount of spectrum per license and the ability to protect existing broadcast operations in this band during the transition to DTV. The comments should address how the size of the spectrum blocks will affect the licensees' ability to deploy new, innovative services and the impact that the size of the spectrum blocks may have on the ability of licensees to compete with existing fixed and mobile service providers. The comments also should consider the need to preserve licensee flexibility in technical and service application choices.

45. In light of the presence of incumbent broadcasters on this band, the Commission seeks comment on whether spectrum blocks of six megahertz could be aligned in the 698-746 MHz band plan to correspond with individual six megahertz television channels. The Commission requests comment on whether the adoption of six megahertz blocks as an appropriately-sized spectrum block would facilitate clearing of the band by incumbent broadcasters or otherwise enhance the value of the spectrum. In addition, in this Notice, the Commission seeks comment on the possibility of a guard band or some other form of protection for services provided below this 698-746 MHz band, on television Channel 51. The Commission requests comments on the impact of the adoption of service rules in this proceeding on the incumbent use of Channel 51.

46. The Commission tentatively concludes that it should adopt a geographic area licensing approach to assign licenses in the 698-746 MHz band. In contrast to station-defined licensing (i.e., site-by-site licensing), the experience has been that geographic area licensing affords licensees substantial flexibility to respond to market demand and may result in significant improvements in spectrum utilization.

47. Assuming that the Commission utilizes a geographic area approach for the 698-746 MHz band, the Commission seeks comment on the appropriate size of service areas on which licenses should be based. Should the Commission license, for example, all or part of the 48 megahertz of reallocated spectrum on a nationwide basis, or would smaller geographic license sizes be more appropriate for this spectrum?

48. The Commission seeks comment, first, on a possible nationwide license. Nationwide licenses have the advantage of providing carriers with more flexibility in the buildout of their services, as well as in coordinating with incumbents. In this regard, the Commission seeks comment on whether any problems associated with the operation of the many incumbent TV stations in this band may be better addressed by licensing this spectrum in larger areas where there may be less of a need for complicated protection agreements. Does the presence of a large number of broadcasters in the 698-746 MHz band make nationwide licenses more desirable than regional or other license sizes? The Commission also seeks comment on the extent to which nationwide licenses maximize the opportunity to provide the widest array of services and business plans. Do nationwide geographic licensing areas, especially in light of the proposal to permit partitioning  19 and the Commission's request for comments in the Notice about spectrum leasing, provide the necessary incentives for fostering the growth of existing technologies while encouraging the development of new applications? Would the adoption of nationwide geographic licensing areas provide potential savings to the time and cost of developing applications and manufacturing equipment to operate in the 698-746 MHz band?

49. In the Upper 700 MHz proceeding, the Commission chose six large, regional Economic Area Groupings (“EAGs”) for the 747-762 MHz and 777-792 MHz bands. The use of regional licenses may permit licensees to take advantage of the opportunities afforded by licensing spectrum on a wide regional basis. Accordingly, the Commission requests comments that address the possibility of issuing large, regional licenses in the 698-746 MHz band. Are the six EAGs the appropriate license size for this reallocated band? Are EAGs (or other regional licenses) preferable to nationwide licenses because they may more easily allow partitioning to serve the needs of smaller users and regional communities? If the Commission adopts six regional EAGs, the Commission seeks comment on what would be the optimal spectrum block size. Commenters should address whether blocks of 48 megahertz, 24 megahertz, or smaller sizes would be appropriate for regional EAGs. The Commission notes that the simultaneous multiple round and combinatorial or package bidding auction designs generally offer bidders flexibility to aggregate multiple licenses to cover larger geographic areas for their particular uses. Would the opportunity to aggregate a small number of regional licenses be sufficient for those seeking to build a nationwide footprint? The Commission invites comment on how to define an appropriate geographic service area in light of the various types of bidding procedures that the Wireless Telecommunications Bureau now has at its disposal.

50. Commenters should also address whether smaller geographic license sizes are appropriate for all or a subset of this spectrum. For example, the Commission has licensed spectrum using smaller territories defined by the 306 Metropolitan Statistical Areas (“MSAs”) and 428 Rural Statistical Areas (“RSAs”), and the 172 EAs and three EA-like areas. When combined, the MSA and RSA service areas create the 734 geographic areas that were originally used to license cellular service. Rural and smaller carriers may prefer licensing based on small geographic areas. If so, which license sizes are preferable to the larger, regional license sizes? Should the Commission license part of the 48 megahertz of spectrum on a large regional (or national) basis and the remaining part of the band in geographic areas of a medium or smaller scale? If commenters support licensing based on service territories other than those discussed previously, they should discuss why other types of service areas are more appropriate. In addition, the Commission seeks comment on the impact that the size of the service area will have on the participation in the auction by parties that may be eligible for the Commission's designated entities provisions.

51. The Commission also seeks comment on whether to license the Gulf of Mexico as part of larger service areas, as the Commission did for the Upper 700 MHz Band, or whether to separately license a service area or service areas to cover the Gulf of Mexico. Commenters who advocate a separate service area or areas to cover the Gulf of Mexico should discuss what boundaries should be used and whether special interference protection criteria or performance requirements are necessary due to the unique radio propagation characteristics and antenna siting challenges that exist for Gulf licensees.

52. The Commission seeks comment on the possible impact that broadcast use of this spectrum would have on the determination of the appropriate geographic service area. The Commission seeks comment elsewhere in the Notice on service rules that may permit the 698-746 MHz band to be used by both full power broadcasting and wireless services. Parties who believe that such combined use should be permitted should first comment on the various choices the Commission is considering in this proceeding for part 27 geographic license areas and spectrum blocks and the impact that this scheme would have on the concept of a station's serving the needs and interests of its community of license pursuant to part 73. Those parties should also comment on any relation between the geographic service area and spectrum block decisions and the combined use of these bands by CMRS and full power broadcast services, which operate using significantly different power levels. The Commission seeks comment on how any decisions regarding spectrum channelization and power levels, if combined use were to be permitted, would affect the appropriate size of geographic licenses, in contrast to limiting or precluding broadcast use of the spectrum. The Commission also seeks comment on alternatives that would rely on licensing by geographic area, by community of license, or by some combination of these approaches.

53. In the Upper 700 MHz proceeding, the Commission determined that spectrum blocks be established and licenses be assigned on the basis of paired bands. The Commission configured the 30 megahertz of spectrum in two paired bands: a 10 megahertz band, designated Block C, and a 20 megahertz band, designated Block D. Each paired band constituted a spectrum block on which auction bids would be based in an EAG. The decision to adopt this paired band architecture reflected an assessment that the most commonly-used transmission procedure for Personal Communications Services (“PCS”), cellular, and other established mobile and fixed wireless applications, Frequency Division Duplex (“FDD”), requires paired spectrum.

54. If the Commission decides that the spectrum in the 698-746 MHz band should be licensed in two or more blocks, should the spectrum be offered as contiguous or paired blocks and, if paired blocks, should the blocks be symmetric or asymmetric in size? The Commission seeks comment on the extent to which the spectrum should be paired or unpaired to enable viable commercial wireless services. Given bidders' opportunities to aggregate licenses under the simultaneous multiple round, combinatorial, and package auction designs, how would the adoption of either a paired or unpaired band structure impact the Commission's ability to achieve its spectrum management goals, including flexible and efficient spectrum use. 20 The Commission requests comment on the degree to which paired or unpaired bands are suited to new technologies, particularly such technologies that would enhance the offering of advanced wireless telecommunications services. Comments should address the particular requirements of the various services and their technologies, including transmission procedures such as FDD or Time Division Duplex (“TDD”), that would use this spectrum, and the impact on such services and technologies of the adopting either a paired or unpaired band architecture.

55. The Commission seeks comment on the extent to which the power limits that are to be established in this rulemaking should affect the adoption of a paired or unpaired band structure. In the Upper 700 MHz proceeding, the Commission allowed 1000 watt effective radiated power (“ERP”) base and fixed stations in both the lower and upper bands, and 30 watt ERP mobile and control station, as well as 3 Watts ERP portables, in both the upper and lower bands. If the Commission decides to adopt a paired band architecture for the 698-746 MHz band, should the Commission enable the use of both base and mobile transmitters on both bands? Furthermore, should the Commission use the same power limits as the Commission adopted in the Upper 700 MHz proceeding, or should some other power limits be authorized instead? To what extent should the Commission adopt power limits or out-of-band emission limits for the 698-746 MHz spectrum that are aimed at enabling TDD operations, or operations that are based on some other form of technology? Comments should address both the methodology to be used, e.g., whether the power limits should be the same or different for the two bands, and the specific power levels to be adopted.

56. The Commission requests comment on the impact that the decisions on the size of spectrum blocks and of the service area should have on the decision on whether to adopt paired or unpaired spectrum bands. For example, would the adoption of smaller spectrum blocks be more or less appropriate in a paired band structure than in an unpaired band structure? Would a decision to license blocks that are large enough for full power broadcast service and to permit sharing of the spectrum by wireless and full power broadcast providers have an impact on the decision to license spectrum on a paired or unpaired basis?

57. The Commission also solicits comment on whether and to what extent the use of paired or unpaired spectrum bands would accommodate entities seeking to negotiate voluntary transition agreements with incumbent television licensees that could enable the clearing of such incumbent licensees from the 698-746 MHz band. Comments should address whether such efforts to facilitate transition agreements are consistent with the objectives of seeking to promote the rapid development of new technologies and the efficient and effective use of the spectrum. 21

58. The Commission seeks comment on whether the general provisions of part 27 of the rules should be applied to the 698-746 MHz band, and specifically on any rules that would be affected by the proposal to apply elements of the part 27 framework, whether separately or in conjunction with part 73 requirements, to full power broadcast services, or to any other parts of the rules. The Commission solicits comment concerning the appropriate rules to adopt for co-channel interference control, out-of-band  22 and spurious emission  23 limits, and power limits and radiofrequency (RF) safety requirements. The comments also should address whether all of these technical rules would apply to all licensees in the 698-746 MHz band, including licensees who acquire their licenses through partitioning or disaggregation.

59. Historically, the Commission has issued rules governing the technical and operating parameters of radio transmitters in order to reduce to a pre-determined level the interference between licensees using the same spectrum assignment in adjacent geographical locations.

60. Recently, the Commission has established new broadband wireless services wherein licensees are authorized to utilize any technology satisfying basic technical rules to provide any type of fixed or mobile service. In the Notice, the Commission seeks comment on a wide range of uses in the Allocation Table. Accordingly, the Commission is potentially allowing a broad range of technologies and services for possible co-existence within this spectrum, and the nature of the services and technologies can affect the potential for interference between licensees using the same spectrum in adjacent service areas. The Commission is particularly interested in receiving comments on potential interference issues that could arise in the event that the Commission decides to reallocate the 698-746 MHz band for use by fixed, mobile, and broadcast services or any combination of these services.

61. The Commission has adopted rules employing one or the other of two methods for broadband fixed and mobile services in regard to addressing the issue of co-channel interference between adjacent systems. In the Cellular Radiotelephone Service, the Commission has mandated that adjacent users coordinate spectrum usage by facilities within 121 kilometers (75 miles) of each other and to resolve technical problems that may inhibit effective and efficient use of the spectrum. 24 This method is a coordination requirement. In the Personal Communications Service and the Wireless Communications Service, the Commission has instead adopted rules requiring that the licensees limit the strength of their signals (“field strength”) to some prescribed value at the boundary of their geographical license area. 25 Provided that the specified field strength limit is met, licensees may unilaterally deploy facilities in the boundary area without coordinating with adjacent licensees. This latter method is the field strength limit.

62. In the Upper 700 MHz proceeding, the Commission adopted a field strength limit rather than a coordination requirement to control co-channel interference in the band. The Commission found that a coordination method could impose unnecessary coordination costs in the case of facilities that were unlikely to cause interference, and possibly could lead to anti-competitive activities. The Commission also determined that the field strength limit will apply to base and fixed stations, the maximum field strength permitted along the geographic area border will be 40 dBμV/m, and that issues of compliance will be determined by calculations using the TV broadcast field strength curves. The use of this procedure was found to potentially enable licensees to deploy their facilities effectively, while minimizing interference to co-channel licensees in adjacent areas. The Commission seeks comment on whether this universal field strength limit rule will in fact minimize interference between all adjacent systems using the same or overlapping spectrum regardless of what types of service, technologies, emission types or power levels are used.

63. The Commission seeks comment on whether to adopt rules establishing a boundary field strength limit to control co-channel interference in the 698-746 MHz band. If the Commission was to choose this method, what should be the field strength limit? Should it be 40 dBμV/m or some other value? The Commission requests comment on whether a field strength limit would reduce the need for coordination by giving licensees the ability unilaterally to deploy facilities in boundary areas as long as the limit is met. The Commission also seeks comment on whether a field strength limit by itself may provide insufficient assurance against interference among co-channel licensees. Even with a boundary limit, would some degree of coordination and joint planning between bordering licensees be needed to ensure efficient use across the boundary? To the extent such coordination between adjacent licensees is likely to be needed, to what extent can the Commission rely on purely voluntary procedures to reach efficient results? Would any rules or guidelines be beneficial in facilitating such coordination? The Commission also seeks comment on whether to adopt criteria to protect Lower 700 MHz stations employing video broadcasting similar to the protection criteria that the Commission establishes herein to protect incumbent DTV stations.

64. The Commission seeks comment on whether to adopt a coordination requirement instead of a field strength limit to control co-channel interference in this band. In the event the Commission decides to use a coordination requirement, how far from the boundary should the coordination zone be located? Would a general coordination requirement minimize the potential for interference or impose unnecessary coordination for facilities with a low potential for interference under either approach?

65. Commenters should provide an analysis of the advantages and disadvantages of both approaches, or approaches that combine a boundary limit and coordination procedure. The Commission seeks comment, for example, on whether anti-competitive behavior could result from the adoption of either approach. Moreover, how do the two methodologies compare in terms of their effect on licensee costs? The comments should address these questions in the context of whether one method or the other would enable licensees to deploy their facilities effectively, while minimizing interference to co-channel licensees in adjacent geographic areas. The Commission also seeks comment on whether there are methods to control interference in the Lower 700 MHz Band that would be more effective than coordination or boundary field strength limits.

66. In the event that the Commission adopts a field strength methodology, the Commission seeks comment on whether licensees in adjoining areas should be permitted to agree to alternative field strengths at their common border. If the Commission was to agree to such a procedure, what would be the impact in terms of increased flexibility and harmful interference? The Commission invites comment on this approach to control interference in the context of the 698-746 MHz band, both generally and if used in conjunction with field strength standards. Should the Commission adopt a general coordination approach is adopted, comments are requested on whether specific aspects of procedures, such as those contained in § 22.150 of the Commission's rules, 26 should apply or, alternatively, whether a general requirement such as the cellular rule  27 should apply.

67. Section 27.64 of the Commission's rules  28 states generally that part 27 stations operating in full accordance with applicable Commission rules and the terms and conditions of their authorizations are normally considered to be non-interfering, and provides for Commission action, after notice and hearing, to require modifications to eliminate significant interference. In view of the variety of services that might be provided by part 27 licensees on this band, including broadcasting, the Commission solicits comment on whether to apply this rule for this spectrum. The Commission also seeks comment regarding whether interference protection can be achieved and whether § 27.64 of the rules should be modified to direct adjacent service area licensees to cooperate to eliminate or ameliorate interference. This alternative would require each licensee ultimately to assume responsibility for protecting its own receiving system from interference from transmitters in adjoining areas that meet the standards.

68. The Commission seeks comment on what interference criteria should be established in the event the Commission adopts service rules that permit full power broadcasting and wireless services to sharing the 698-746 MHz band. The Commission also seeks comment on whether to adopt any protection of television service provisions addressed elsewhere in the Notice into the co-channel interference rule.

69. In many of the radio services, the Commission often requires that out-of-band emissions be limited to no more than 50 microWatts (50 μW) of transmitter output power over a typical instrument measurement bandwidth. The rules that implement this requirement generally do so in the form of an attenuation requirement of 43 + 10 log P dB. In the Upper 700 MHz proceeding, the Commission adopted this general out-of-band emission limit to apply to equipment transmitting in the 747-762 and 777-792 MHz bands that were the subject of the service rules under consideration. However, the Commission also adopted more strict limits for out-of-band emissions that fall within the Global Positioning Service (“GPS”) band and within the 764-776 MHz and 794-806 MHz public safety bands. The Commission invites comment on what out-of-band emission standards should be established in the service rules for the Lower 700 MHz Band. The Commission seeks comment on whether to adopt a rule applying the general out-of-band emission attenuation requirement of 43 + 10 log P dB to equipment used in the 698-746 MHz band. What are the potential costs and benefits of requiring greater or lesser attenuation of out-of-band emissions? The Commission also requests comment on any other emission limits that commenters believe to be appropriate. For example, should the limit specify a single out-of-band attenuation level or should it specify a power roll-off that increases attenuation as frequency separation from the channel boundary increases?

70. In the Upper 700 MHz proceeding the Commission found that stricter attenuation requirements were required to adequately protect the public safety bands from interference. The Commission adopted an attenuation requirement of 65 + 10 log P dB per 6.25 kHz for mobile and portable transmitters, and an attenuation requirement of 76 + 10 log P dB per 6.25 kHz for base and fixed transmitters for out-of-band emissions that fall within the 764-776 MHz and 794-806 MHz public safety bands. The Commission requests comment on whether it is necessary to adopt a rule, applicable to equipment transmitting in the 698-746 MHz band, that provides more stringent attenuation requirements for out-of-band emissions that fall within the 764-776 MHz and 794-806 MHz public safety bands. The Commission seeks comment on whether equipment transmitting in the upper portion of the 698-746 MHz commercial band poses a risk of interference to public safety operations that justifies adoption of these more stringent attenuation requirements. The Commission also seeks comment on what resolution bandwidth should be used for measurements to determine compliance with the out-of-band emission limits.

71. In the Upper 700 MHz proceeding, the Commission concluded that with regard to communications power requirements, equipment transmitting in the 747-762 MHz and 777-792 MHz bands will have characteristics similar to equipment used in other services in the sub-microwave UHF frequency bands. Accordingly, rules were adopted that provided a maximum power limit of 1000 Watts ERP for base and fixed stations, 30 Watts ERP for vehicular mobile transmitters and 3 Watts ERP for hand held portable transmitters. The Commission requests comment on whether these limits are also appropriate for base, fixed, mobile and portable transmitters operating in the 698-746 MHz band, or whether some other limits should be adopted. The Commission also seeks comment on the use of up to 50 kW ERP for video broadcasting in this band.

72. The Commission considers RF safety procedures to be essential in protecting human beings from excessive exposure to RF energy. Accordingly, the Commission proposes to require that facilities and devices operating in the Lower 700 MHz Band be subject to the existing RF safety criteria and procedures applicable to facilities and devices having similar technical parameters and operating characteristics. 29 The Commission seeks comment on this proposal.

73. The Commission seeks comment below on the licensing rules for a full range of possible licensees, in accordance with the stated intention to permit as much flexibility in the use of this spectrum as is consistent with the requirements of section 303(y) of the Communications Act. The Commission seeks comment generally on whether licensees in the reallocated 698-746 MHz band should be governed by part 27 of the Commission's rules. Part 27 was established to satisfy the requirement in section 3001 of the Omnibus Consolidated Appropriations Act of 1997 to reallocate and assign the use of the frequencies at 2305-2320 MHz and 2345-2360 MHz. Part 27 was initially adopted to govern services offered on those bands, and accorded licensees the flexibility to provide any fixed, mobile or radiolocation service contained in the Table of Allocations in part 2 of the Commission's rules. The regulatory framework of part 27 includes, inter alia: (i) the limitation of eligibility requirements to foreign ownership restrictions set forth in section 310 of the Communications Act; (ii) exclusion of part 27 spectrum holdings from application of the CMRS spectrum cap; (iii) flexibility to partition geographic service areas and disaggregate spectrum blocks; (iv) determination of regulatory status by licensee's designation in their long-form applications; and (v) incorporation, with some exceptions, of the competitive bidding rules set forth in part 1 of the Commission's rules. The Commission adapted and applied the part 27 licensing procedures to the 746-764 MHz and 776-794 MHz bands in the Upper 700 MHz proceeding.

74. The Commission tentatively concludes that a licensee in the 698-746 MHz band may include any or a combination of services with more than one regulatory status in a single license. In adopting a flexible licensing framework for part 27, the Commission permitted applicants to request more than one regulatory status for authorization in a single license, rather than require the applicant to choose a single status for its proposed services. Thus, a part 27 license may authorize a combination of common carrier, non-common carrier and broadcast services in a single license, and the part 27 licensee may render any kind of communications service consistent with that regulatory status. As the Commission tentatively concludes to authorize licensees in the 698-746 MHz band to provide a variety of services ( e.g., fixed, mobile, etc.) under more than one regulatory status ( i.e., common carrier, non-common carrier, and/or broadcast), any one licensee would be permitted to provide any combination of services, anywhere within its licensed area at any time, consistent with its regulatory status and interference protection requirements. Given the decision to apply this part 27 licensing framework in the Upper 700 MHz proceeding, the Commission seeks comment on the tentative conclusion to adopt this same framework for licensing services in the 698-746 MHz band. Does applying the same approach used for the Upper 700 MHz Band to this reallocated 698-746 MHz spectrum achieve efficiencies in the licensing and administrative processes?

75. Assuming that a 698-746 MHz licensee regulated under part 27 may provide any communications service consistent with its authorized regulatory status, the Commission seeks comment on whether that licensee should be subject to other Commission rules specifically applicable to the nature of the service provided. Alternatively, the Commission seeks comment on whether to amend part 27 to include any other obligations for certain services authorized on this band. For example, the Communications Act applies specific requirements to broadcasters and common carriers that are not applied to other part 27 licensees. In the Upper 700 MHz First Report and Order, the Commission determined that the provision of “new broadcast-type” services does not alter the underlying broadcast nature of such services on the Upper 700 MHz Band, and as a result, such services are subject to the regulatory and statutory provisions governing broadcast service. However, in the Upper 700 MHz MO&O and FNPRM, the Commission declined to go so far as to apply an “equivalent regulatory regime” from part 73 of the rules to part 27 broadcast licensees in the Upper 700 MHz band, stating that the Commission would determine the applicable regulatory framework in the context of the offering of specific, actual new broadcast-type services. The Commission tentatively concludes that the Commission will adopt the same approach for part 27 broadcast licensees on the 698-746 MHz band as the Commission did for the Upper 700 MHz Band. The Commission seeks comment generally on any provisions in existing, service-specific rules that may require specific recognition or adjustment to comport with the potential supervening application of part 27, as well as any provisions that would be necessary in part 27 to fully describe the scope of covered service and technologies.

76. The possible inclusion of full power broadcasting within the reallocated 698-746 MHz band is more problematic with respect to the licensing and administrative process. The Commission asks commenters to address whether a decision to permit full power broadcasting within this band affects the tentative conclusion that there should be no additional requirements for new broadcast-type licensees operating under part 27. 30 If the Commission decides to permit full power broadcasting in this reallocated spectrum, should part 73 apply to licensees to the extent they provide any broadcast services (including full power broadcasting as well as new broadcast-type services) and should part 27 apply to the extent licensees provide other wireless services?

77. Consistent with the part 27 framework adopted for the Upper 700 MHz Band, the Commission seeks comment on whether applicants and licensees in the 698-746 MHz band should also be required to indicate to the Commission the regulatory status of any services that they choose to provide. To ensure compliance with the statutory requirements of Titles II and III of the Communications Act, the Commission has often required applicants to designate the regulatory status of the services they intend to provide. For example, the Commission's current Form 601 Application for Wireless Telecommunications Bureau—Radio Service Authorization requires an applicant to indicate whether the service it intends to offer will be common carrier, non-common carrier, private, broadcast, and/or band manager. If the Commission decides to require 698-746 MHz applicants and licensees to designate their regulatory status, does the Form 601 need to be revised in any way? To the extent that full power broadcast service is included in this reallocated spectrum, is there a need to modify the Form 601 or any other appropriate form(s) that an applicant may use to seek these services, either solely or in conjunction with other services under a single license?

78. The Commission seeks comment on whether applicants and licensees in the 698-746 MHz band should be required to describe their proposed services. In adopting part 27, the Commission stated that, apart from this designation of regulatory status, the Commission would not require applicants to describe the services they seek to provide. Likewise, in the Upper 700 MHz proceeding, the Commission stated that it is sufficient that an applicant indicate its choice of regulatory status in a streamlined application process. Should the Commission apply a similar approach to services provided in the Lower 700 MHz Band, including full power broadcast as well as new broadcast-type services? If potential applicants are unsure of the nature of their services and their classification, the Commission seeks comment on whether to require applicants to submit a petition with their applications requesting clarification and including service descriptions for that purpose.

79. The Commission also seeks comment on whether to permit licensees to change their service in such a way that it alters their regulatory status. If the Commission permits licensees to alter their regulatory status, what procedures should it adopt to provide for this change? The Commission seeks comment on whether to require such licensees to notify the Commission that they have altered their status, even if such change would not require prior Commission authorization. Similar to Upper 700 MHz Band licensees, should licensees in the Lower 700 MHz Band be required to notify the Commission within 30 days of the change, unless the change results in the discontinuance, reduction, or impairment of the existing service, in which case a different time period may apply? In these situations, how can the Commission best maximize a carriers' flexibility in service offerings while also implementing, for example, the requirement in section 214(a) of the Communications Act that the Commission certify that the public convenience and necessity will not be adversely affected by such actions initiated by carriers?  31 Does the potential inclusion of broadcasting, including full power broadcast services, require us to modify this approach? Because full power broadcast licensees are subject to different ownership rules and attribution standards than wireless licensees, the Commission requests comment on what procedures should apply when a licensee changes its offerings between these regulatory classifications.

80. The Commission seeks comment on whether to permit licensees to lease their licensed spectrum usage rights in accordance with the proposals may be adopted in the Secondary Markets NPRM , 65 FR 81475, December 26, 2000, corrected by 66 FR 8149, January 29, 2001. In the alternative, the Commission asks commenters to address any unique attributes of the Lower 700 MHz Band ( e.g., level of incumbency) that would justify a level of flexibility different from what the Commission adopts generally in that proceeding. In considering leasing arrangements in the Secondary Markets NPRM , the Commission stated the primary issue may be whether all licensees in certain services should have the option to use some or all of their licensed spectrum in the same manner as a band manager, i.e., to make spectrum available to third party users without the need for prior Commission approval, while retaining primary responsibility for compliance with the Commission's rules. The Commission also seeks comment on the potential for band manager licensing to provide flexibility for the Lower 700 MHz Band given the distinctive technical and/or policy issues associated with its reallocation. Because the Commission has not issued a decision in the Secondary Markets proceeding, the Commission seeks comment on the extent to which leasing arrangements and/or band manager licensing would help achieve the maximum flexibility possible for the use of this spectrum, consistent with technical and regulatory constraints.

81. The Commission also seeks comment on whether the service and auction rules should have any special provisions for private radio and/or public safety services on the 698-746 MHz band. For example, should parties who would function as band managers with the ability to lease their spectrum rights to various types of users, including private radio and/or public safety users, be eligible to bid for this spectrum? To enable the full and flexible use of this reallocated spectrum, the Commission asks commenters to address any specific measures that should be taken to accommodate the provision of private and public safety regulatory classes of services.

82. In the Upper 700 MHz First Report and Order , the Commission decided to impose no restrictions on eligibility for a license in the 747-762 MHz and 777-792 MHz bands, other than the foreign ownership restrictions set forth in section 310 of the Communications Act. Consistent with this approach, the Commission proposes that there be no restrictions on eligibility for a license in the 698-746 MHz band. The Commission seeks comment on the view that opening this spectrum to as wide a range of applicants as possible will encourage entrepreneurial efforts to develop new technologies and services, while helping to ensure efficient use of this spectrum. Commenters also should address how the proposed policy to not impose restrictions on eligibility should apply to possible use of this spectrum for broadcasting.

83. The Commission also seeks comment on the character qualification standard that should be applied to licensees in the 698-746 MHz band. While the character qualification standards applied to broadcasters have provided guidance in common carrier proceedings, the Commission has said that these standards are not “directly applicable” to common carriers. The Commission seeks comment on whether there is any reason that full power broadcasters who share spectrum with part 27 wireless services, including wireless common carrier offerings, should not be governed by the existing standards applied to part 73 licensees. The Commission also seeks comment on whether there is any reason the Commission cannot apply the current rules to decide whether an entity that has been disqualified from holding a full power part 73 broadcasting license pursuant to the character qualification rules should be eligible to provide non-broadcasting services pursuant to a part 27 license.

84. To the extent that the Commission allocates spectrum within the 698-746 MHz band for the provision of CMRS, the Commission seeks comment on whether spectrum in this band, if used to provide CMRS, should be subject to the Commission's 45/55 MHz CMRS spectrum cap. 32 Currently, 180 MHz of broadband PCS, cellular, and SMR spectrum regulated as CMRS is subject to the Commission's 45 MHz (55 MHz in rural areas) spectrum cap. Part 27 of the Commission's rules does not limit the amount of spectrum that an entity may aggregate in any given geographic area. In the Upper 700 MHz proceeding, the Commission refrained from extending the CMRS spectrum cap to the newly reallocated 746-764 and 776-794 MHz bands.

85. In light of the findings in the Upper 700 MHz proceeding, the Commission seeks comment on whether to abstain from counting the 698-746 MHz band against the CMRS spectrum cap. Alternatively, if the Commission decides to apply the spectrum cap to this spectrum, the Commission seeks comment on whether and if so, how much, the Commission should increase the amount of spectrum a single entity can hold beyond the 45/55 MHz threshold. In this regard, it has been the expectation that newly available CMRS-suitable spectrum either should be excluded from the cap, or if it is included, that the cap should be adjusted accordingly. Under the former alternative, if the spectrum does not count towards the cap and licensees use it for provision of CMRS, what impact will that have on competition in the CMRS marketplace? Under the latter alternative, what impact would an increase of the cap have on the reduction or concentration of competition and on changes in the prices or to the quality of services. Commenters should address the relevance of the factors that the Commission considered in the decision not to apply the spectrum cap to the 746-764 and 776-794 MHz bands, including (1) whether applying the spectrum cap would be consistent with the goals of seeking flexible use of this spectrum; (2) whether permitting licensees to acquire all of the available lower 700 MHz spectrum in a given geographic area would result in economies of scale that could promote a variety of services, including advanced wireless services; and (3) whether it makes sense to count this spectrum against the cap if the extent to which the 698-746 MHz band will be used for CMRS services is not clear.

86. The Commission also seeks comment on whether spectrum in the 698-746 MHz band should be subject to any other aggregation limits. The Commission decided not to adopt any in-band spectrum aggregation limits for the 747-762 MHz and 777-792 MHz bands. Similarly, should the Commission not restrict the amount of commercial spectrum that any one licensee may obtain in the 698-746 MHz band in the same licensed geographic service area? If so, comment is then sought on whether there should be any cross-band aggregation limits between the 747-762 MHz and 777-792 MHz bands, and the 698-746 MHz band. Should the Commission preclude or otherwise limit an entity from obtaining all 78 MHz of spectrum in the combined Upper and Lower 700 MHz Bands in the same geographic area?

87. In the Upper 700 MHz First Report and Order, the Commission concluded that § 27.12 of the Commission's rules, which implements section 310 of the Act, 33 should apply to applicants for licenses in the 747-762 MHz and 777-792 MHz bands. The Commission tentatively concludes that § 27.12 of the Commission's Rules should apply to applicants for 698-746 MHz band licenses. With respect to the alien ownership reporting requirements, the Commission tentatively concludes that it will require all licensees in the 698-746 MHz band spectrum to file changes in foreign ownership information to the extent required by part 27 of the rules. The Commission requests comment on this approach.

88. The Communications Act imposes no term limit on licenses issued by the Commission, other than those for broadcast services, which are limited to an eight-year license term. 34 The statute also specifies renewal criteria for broadcast stations. 35 Part 27 of the Commission's rules provides for license term limits and renewal expectancy for other than new broadcast-type services. Section 27.13(a) limits license terms for certain licensees to 10 years from the date of original issuance or renewal, 36 and § 27.14(b) establishes a right to a renewal expectancy. 37

89. In the Upper 700 MHz First Report and Order, the Commission modified the license term as it relates to the 747-762 MHz and 777-792 MHz bands, to accommodate licensees' need for additional time to develop and use this spectrum, in light of its continued use by broadcasters until 2006. The Commission decided that initial licenses for the 746-764 MHz and 776-794 MHz bands would extend eight years beyond the year 2006, the date as of which incumbent broadcasters are required to have relocated to other portions of the spectrum, ( i.e., January 1, 2015, see Upper 700 MHz Errata, 65 FR 57267, September 21, 2000) subject to certain conditions. However, a licensee that commences new broadcast-type operations on or before January 1, 2006, will be required to seek renewal of its license at the end of the eight-year term following commencement of such broadcast operations. 38

90. The Commission seeks comment on the appropriate license term to apply with respect to licensees in the 698-746 MHz band. The Commission seeks comment on whether to adopt the license term and renewal provisions in part 27 of the Commission's Rules, for other than new broadcast-type services. 39 The Commission therefore seeks specific comment on whether the initial license term for licenses, other than new broadcast-type services, should expire on January 1, 2015. In addition, the Commission seeks comment on other alternatives, such as a 10-year license term. Commenters should also address whether it would be possible to have different license terms, depending on the type of service offered by the licensee. The Commission also seeks comment on how the Commission would administer such an approach, particularly if licensees provide more than one service in their service area, or decide to change the type of service they plan to offer.

91. Furthermore, in the Upper 700 MHz First Report and Order, the Commission adopted the right to a renewal expectancy established in § 27.14(b). 40 The Commission found that in order for a licensee involved in a comparative renewal proceeding to claim a renewal expectancy that licensee must include, at a minimum, the showing required by § 27.14(c) of the Commission's rules. The Commission seeks comment on whether to likewise adopt the right to a renewal expectancy established in § 27.14 for licensees in the 698-746 MHz band.

92. The Commission also seeks comment on whether a new broadcast licensee operating in the Lower 700 MHz Band would be able to claim the renewal expectancy established by section 309(k) of the Act. 41 The Commission seeks comment on whether there should be a distinction between the renewal expectancy that the Commission will provide to new broadcasters in the Lower 700 MHz Band and licensees offering other services ( i.e., datacasting and other wireless services) on this band.

93. Consistent with part 27, in the Upper 700 MHz First Report and Order, the Commission found that in the event that a license is partitioned or disaggregated, any partitionee or disaggregatee shall be authorized to hold its license for the remainder of the original licensee's term, and the partitionee or disaggregatee may obtain a renewal expectancy on the same basis as other licensees in the band. 42 Further, the Commission decided that all licensees meeting the substantial service requirement will be deemed to have met this part of the renewal expectancy requirement regardless of which of the construction options the licensees have chosen. The Commission concluded that this approach is appropriate because a licensee, through partitioning, should not be able to confer greater rights than it has been awarded under the terms of its license grant. The Commission seeks comment on taking this approach with respect to 698-746 MHz licensees.

94. Section 27.14(a) of the Commission's rules requires licensees to provide “substantial service” in their service areas within their prescribed license term. Failure to meet this requirement will result in forfeiture of the license. 43 In the Upper 700 MHz First Report and Order, the Commission amended the performance requirement in § 27.14(a) as it relates to the 747-762 MHz and 777-792 MHz bands. The Commission required in the 747-762 MHz and 777-792 MHz bands to provide substantial service to their service areas no later than January 1, 2015, eight years after December 31, 2006, the date as of which incumbent broadcasters are required to have relocated to other portions of the spectrum. This section defines substantial service “as service which is sound, favorable, and substantially above a level of mediocre service which just might minimally warrant renewal.” In the Part 27 Report and Order, 62 FR 9636, March 3, 1997, the LMDS Second Report and Order, 62 FR 23148, April 29, 1997, and the Upper 700 MHz First Report and Order, the Commission adopted safe harbors that would demonstrate substantial service. In implementing its auction procedures, section 309(j)(4)(B) of the Communications Act requires the Commission to include safeguards to protect the public interest in the use of the spectrum and performance requirements “to ensure prompt delivery of service to rural areas, to prevent stockpiling or warehousing of spectrum by licensees or permittees, and to promote investment in and rapid deployment of new technologies and services.”  44 In addition, the Commission seeks to promote the efficient and effective use of the spectrum. 45 The Commission invites comment on the development of service rules to meet these objectives.

95. The Commission seeks comment on whether to require licensees in the 698-746 MHz band to provide substantial service on January 1, 2015, the date that the Commission requires licensees in the 747-762 and 777-792 MHz band to provide substantial service. The Commission also seeks comment on whether to adopt any safe harbors for licensees in the 698-746 MHz band. In the Upper 700 MHz First Report and Order, the Commission adopted two safe harbors for fixed services: (1) for a licensee who chooses to offer fixed, point-to-point services, the construction of the permanent links per one million people in its licensed service area during its license term or at the license-renewal mark would constitute substantial service; and (2) for a licensee who chooses to offer fixed, point-to-multipoint services, a demonstration of coverage for 20 percent of the population of its licensed service area during its licensed term or at the license-renewal mark would constitute substantial service. The Commission also there encouraged licensees to build out not only in urban areas and areas of high density population but in rural areas as well, or to partition their license to allow others to do so. In addition, the Commission seeks comment on whether to adopt safe harbors for mobile services (assuming the Commission adopts the substantial service requirement for mobile services) and, if so, what safe harbors would be appropriate. If commenters support safe harbors other than those listed above, they should discuss what other safe harbors should be adopted.

96. The Commission also seeks comment on distinct issues raised by applying this proposal to new potential broadcast use of the spectrum. Broadcast permittees operating pursuant to part 73 are required to construct their facilities within three years. 46 The Commission requests comment on whether there are any reasons not to apply these rules to new broadcasters on these bands. Further, the Commission seeks comment on whether to adopt a substantial service test for broadcasters operating on this band and, if so, what safe harbors would be appropriate.

97. In the Upper 700 MHz First Report and Order, the Commission provided licensees in the 746-764 MHz and 776-794 MHz bands flexibility by permitting geographic partitioning of any service area defined by the partitioner and partitionee and spectrum disaggregation without restriction on the amount of spectrum to be disaggregated. The Commission tentatively concludes that the Commission also should permit licensees in the 698-746 MHz band to partition and disaggregate their licenses. The Commission tentatively concludes that geographic partitioning and spectrum disaggregation can result in efficient spectrum use and economic opportunity for a wide variety of applicants, including small business, rural telephone, minority-owned, and women-owned applicants. 47 The Commission also tentatively concludes that this approach will provide a means to overcome entry barriers through the creation of smaller licenses that require less capital, thereby facilitating greater participation by rural telephone companies and other smaller entities, many of which are owned by minorities and women. The Commission seeks comment on each of these matters.

98. Section 27.15 of the Commission's rules  48 permits licensees seeking approval for partitioning and disaggregation arrangements to request authorization from the Commission for partial assignment of a license, and provides that licensees may apply to partition their licensed geographic service areas or disaggregate their licensed spectrum at any time following the grant of their licenses. In the Upper 700 MHz First Report and Order, the Commission decided to permit geographic partitioning of any service area defined by the partitioner and partitionee, to permit spectrum disaggregation without restriction on the amount of spectrum to be disaggregated, and to permit combined partitioning and disaggregation. Pursuant to § 27.15, the partitioning licensee must include with its request a description of the partitioned service area and calculations of the population of the partitioned service area and the licensed geographic service area. 49 Licenses that partition and disaggregate also are subject to the provisions against unjust enrichment set forth in § 27.15(c). 50 The Commission requests comment on whether licensees in the 698-746 MHz band should be eligible to partition service areas and disaggregate spectrum to the same extent that licensees in the 746-764 MHz and 776-794 MHz bands are permitted to do so. The Commission also requests comment on what limits, if any, should be placed on the ability of licensees to partition service areas and disaggregate spectrum.

99. The Commission also proposes to adopt the methods that the Commission adopted in the Upper 700 MHz First Report and Order for parties to partitioning, disaggregation, or combined partitioning and disaggregation agreements to meet construction requirements. Specifically, the Commission proposes that parties to partitioning agreements be permitted to choose between two options for satisfying the construction requirements. Under the first option, the partitioner and partitionee would each certify that it will independently satisfy the substantial service requirement for its respective partitioned area. If a licensee fails to meet its substantial service requirement during the relevant license term, the non-performing licensee's authorization would be subject to cancellation at the end of the license term. Under the second option, the partitioner certifies that the requirement has been or will be met for the entire market. If the partitioner fails to meet the substantial service standard during the relevant license term, only its license would be subject to cancellation at the end of the license term. The partitionee's license would not be affected by such failure.

100. Finally, the Commission proposes to allow parties to disaggregation agreements to choose between two options for satisfying the construction requirements. Under the first option, the disaggregator and disaggregatee would certify that they will share responsibility for meeting the substantial service requirement for the geographic service area. If parties choose this option, both parties' performance will be evaluated at the end of the relevant license term and both licenses could be subject to cancellation. The second option would allow the parties to agree that either the disaggregator or the disaggregatee would be responsible for meeting the substantial service requirement for the geographic service area. If parties choose this option, and the party responsible for meeting the construction requirement fails to do so, only the license of the non-performing party would be subject to cancellation.

101. In the Upper 700 MHz First Report and Order, the Commission decided that licensees in the 747-762 MHz and 777-792 MHz bands would be subject to the operational rules contained in part 27 that govern operations, modified to accommodate the particular circumstances of the Upper 700 MHz proceeding. The Commission seeks comment generally on the applicability of these rules to the 698-746 MHz band and whether any operating rules contained in other parts of the Commission's rules should be adopted for the 698-746 MHz band. In addition, the Commission asks commenters to suggest any alternatives to such regulations governing a licensee's operations in order to minimize the potential significant economic impact, if any, from such rules on small entities.

102. The Commission seeks comment on whether to consider forbearance initiatives that are targeted specifically to new licensees that will operate in the Lower 700 MHz Band. Commenters should address how forbearance might apply to the various services that might be offered in the Lower 700 MHz Band, including CMRS, fixed wireless and new broadcast-type service.

103. The Commission tentatively concludes that for the Lower 700 MHz Band an applicant's EEO requirements will be determined by the type of service an applicant chooses to provide. The Commission seeks comment on this matter.

104. Section 309(j)(14)(C) requires the Commission to assign licenses for the 698-746 MHz band by means of the competitive bidding procedures adopted pursuant to section 309(j) of the Act. Consistent with that directive, the Commission requests comment on a number of issues relating to the competitive bidding procedures for the 698-746 MHz band.

105. The Commission proposes to conduct the auction of initial licenses in the 698-746 MHz band in conformity with the general competitive bidding rules set forth in part 1, subpart Q, of the Commission's rules, and substantially consistent with the bidding procedures that have been employed in previous auctions. 51 Specifically, the Commission proposes to employ the part 1 rules governing competitive bidding design, designated entities, application and payment procedures, reporting requirements, collusion issues, and unjust enrichment. Under this proposal, such rules would be subject to any modifications that the Commission may adopt in the part 1 proceeding. In addition, consistent with current practice, matters such as the appropriate competitive bidding design for the auction of 698-746 MHz band licenses, as well as minimum opening bids and reserve prices, would be determined by the Wireless Telecommunications Bureau pursuant to its delegated authority, see Part 1 Third Report and Order, 63 FR 770, January 7, 1998, 63 FR 2315, January 15, 1998 corrected by 63 FR 12658, March 16, 1998. The Commission seeks comment on whether any of the part 1 rules would be inappropriate in an auction of licenses in the 698-746 MHz band.

NHTSA undertook a review of its regulations and directives and identified rules that it could propose to eliminate as unnecessary or to amend to improve their comprehensibility, usefulness, and appropriateness. NHTSA identified the Semi-Annual Reports for Automotive Fuel Economy as a candidate for review and, as noted below, issued a proposal to amend the semi-annual report requirements.

Section 32907 of title 49, United States Code (49 U.S.C. 32907) requires automobile manufacturers to submit semi-annual reports to NHTSA. These reports indicate whether the manufacturer will comply with applicable fuel economy standards for a model year, state the actions that the manufacturer has taken or intends to take to comply with the standard, and provide other information required by regulation (49 U.S.C. 32907(a)(1)). Section 32907(a)(2) specifies that two reports must be filed for each model year (49 U.S.C. 32907(a)(2)). One report is due before the beginning of each model year, and the second is due within 30 days of the 180th day of the model year. In the event that a manufacturer determines, after having previously reported that it would comply with the applicable standard for that model year, that the actions it has taken in an effort to comply with an applicable fuel economy standard are not sufficient to ensure compliance with that standard, the manufacturer is required by section 32907(a)(3) (49 U.S.C. 32907(a)(3)) to report additional actions that the manufacturer intends to take to comply and whether those actions will be sufficient to ensure compliance. However, if a manufacturer is subject to an alternative fuel economy standard under Section 32902(d)(2) (49 U.S.C. 32902(d)(2)), it is not required to submit any of the foregoing reports.

NHTSA published a final rule in the Federal Register on December 12, 1977 (42 FR 62374), implementing the provisions of Section 32907 and adding several requirements to those expressly contemplated by that section's provisions. In the final rule, the agency observed that since manufacturers have different annual production periods, there was no single model year designation applicable to all companies. Accordingly, NHTSA determined to use the calendar year to specify the timing of the section 32907 reports, making the pre-model year report for a model year due in December (49 CFR 537.5(b)(1)) (e.g., the pre-model year report for the 2001 model year was due in December 2000) and the mid-model year report for that model year due in July (49 CFR 537.5(b)(2)) (e.g., the mid-model year report for the 2001 model year is due in July 2001). For the major domestic manufacturers, this means that the pre-model year report is submitted during the early part of their production period and the mid-model year report is due near the end of that period. The final rule also established requirements for the content of the reports (49 CFR 537.6, 537.7), as well as for the supplemental reports that are required when a manufacturer determines that it cannot meet applicable fuel economy standards (49 CFR 537.8).

In a notice of proposed rulemaking (NPRM) issued on May 13, 1996 (61 FR 22010), the agency proposed revisions to simplify the reporting requirements contained in Part 537. The agency proposal sought to reverse the order in which the most detailed information must be submitted by manufacturers. Instead of submitting the detailed data in the pre-model year report, the NPRM proposed that these data be presented in the mid-model year report. This change was intended to lead to the submission of more complete and correct data because the data would be gathered later in the typical production period for each model. The proposal sought to reduce the amount of detailed data required in the mid-model year report by requesting data at the model level instead of requiring data about different configurations within model lines. The proposal also sought to modify the format for the reports so that data would be submitted in a form more closely matching the format used by the agency in analyzing manufacturer fleets in the annual Automotive Fuel Economy Report to Congress and other special reports and studies. The proposal also sought to eliminate some categories of information (SAE horsepower, Engine Code, Emission Control System, Existence of Overdrive, and data relating to classification as a passenger car or light truck), modified other categories (Number of Carburetor Barrels, and Projected Sales), and added new categories (Number of Engine Cylinders and Road Load power at 50 miles per hour). Further, for both the pre and mid-model year reports, the proposal indicated that model type information be provided in order of increasing equivalent test weight, replacing the prior specification that these data be provided in order of increasing average inertia weight.

The NPRM also proposed to delete § 537.8 in its entirety. This section contains the requirements for supplementary reports. The proposal explained that in the event that a supplementary report is filed or requested in the future, revisions in § 537.7(b)(4) would incorporate the supplemental report into the mid-model year reports.

The agency received comments on the proposed revisions from two trade associations and three manufacturers. The American Automobile Manufacturers Association and the Association of International Automobile Manufacturers (AAMA/AIAM) submitted joint comments and Chrysler Corporation (Chrysler), Ford Motor Company (Ford), and General Motors Corporation (GM) also submitted comments. Manufacturers were generally supportive of the intent of the proposed revisions, but expressed concerns that some changes might impose significant financial burdens by requiring computer reprogramming and the expenditure of resources for the collection and preparation of information that is not used by the industry or other federal government agencies. All of the commenters objected to the proposal's specification of “equivalent test weight” as a replacement for “average inertia weight” in § 537.7(c). The commenters argued that “equivalent test weight” is a term that is used to describe vehicles at the model level as opposed to the configuration level. As § 537.7(c) currently specifies “average inertia weight,” which applies at the configuration level, the commenters indicated that use of “equivalent test weight” would require submission of more complex reports.

In addition to these general concerns, both AAMA/AIAM and each of the manufacturers had individual concerns regarding discrete elements of the agency's proposal.

AAMA/AIAM argued for several alterations to the proposed modifications of § 537.7(c)(4). In light of the agency's stated goal of simplifying the detailed information proposed to be incorporated into the mid-model year reports by requiring it at the model level, AAMA/AIAM requested that two other specifications—road load power and equivalent test weight—be changed or discarded. The associations also contended that other proposed parameters would be of little value, since “loaded vehicle weight,” as well as “total drive ratio” are data that relate to vehicle configurations rather than model types. Instead of using equivalent test weight and loaded vehicle weight, AAMA/AIAM suggested that “inertia weight class” be used instead. The organizations stated that “loaded vehicle weight” and “total drive ratio” are not used by the Environmental Protection Agency (EPA) for calculating model fuel economy and should be stricken from the proposed requirements. AAMA/AIAM also suggested that the manufacturers' final CAFE reports should be submitted concurrently to the EPA. AAMA/AIAM also stated that this process would allow the EPA time to review the calculations and to properly notify (i.e., within 60 days) both NHTSA and the manufacturers that the calculations are either correct or require modification. AAMA/AIAM recommended reducing the pre-model year report to only a projected fleet average corporate average fuel economy (CAFE) level and a projected production volume. Finally, AAMA/AIAM strongly suggested that the proposal's requirement that specific data be included in the mid-model year report be stricken entirely and that both the pre- and mid-model year reports contain only fleet averages and projected total production volumes.

GM indicated its belief that the proposed changes would not necessarily simplify reporting tasks or lessen manufacturer burdens. The company suggested that the model type report format in the proposal be modified to list each model type with its associated projected volume, combined fuel economy, and average equivalent test weight class. GM also argued for changes in the proposed format for mid-model year reports. The company noted that the proposal's revision of § 537.7(c)(3)—which sought to replace a requirement that information be provided at the configuration level for only those vehicles that had been tested with a requirement that the same information be provided at the model level—would increase the regulatory burden of manufacturers instead of reduce it. In addition, the revisions proposed for § 537.7(c)(4) would, in GM's view, require the expenditure of additional resources to acquire data and change their computer systems to include SAE power, road load horsepower, total drive ratio, and loaded vehicle weight. GM also contended that, in deleting § 537.8, relating to supplementary reports, and inserting a provision for supplementary reports into part 537, which outlines requirements for pre- and mid-model year reports, the proposal created a new requirement, as supplementary reports would have to be incorporated into the mandatory pre- and mid-model year reports. GM also observed that § 537.7(c)(3) of the proposal indicated that mid-model year report data be provided either in tabular form or electronically. The company suggested that it would be prudent to require that the data be submitted both electronically and on paper.

Chrysler also argued that the proposed changes to data formats and content would require significant computer reprogramming efforts. The company also recommended reducing the pre-model year report to only a projected fleet average corporate average fuel economy (CAFE) level and a projected production volume. Finally, Chrysler indicated that it was unsure why NHTSA departed from English units of HP to SAE net rated power in kilowatts.

Ford recommended deleting some categories of data the proposal would require in the mid-model year report. The company indicated that final production volumes classified by loaded test weight, total drive ratio, and road load power are not known at the time of mid-model report submission. In Ford's view, the proposed requirements would force the company to submit reports that could be both inaccurate and misleading. Ford also noted that § 537.7(c)(5) of the proposed regulatory text specified that certain data be provided for light trucks classified as being capable of off-highway operation under 49 CFR Part 523 and indicated that this reference should specifically refer to § 523.5(b).

Following its review of the comments, NHTSA sought EPA's views of the proposal and the impact that adoption of the proposal would have on that agency's role in the administration of the CAFE program. The EPA said that the agency's proposal would be detrimental in several respects. EPA opposed the relaxation of the semi-annual report requirements. In particular, EPA urged this agency to not change the requirement that data be submitted on the configuration level. As that agency analyzes fuel economy data in detail, it urged NHTSA to retain existing requirements that vehicle configuration, transmission configuration, and axle ratios be reported. In addition, EPA indicated that the continued reporting of SAE horsepower is necessary to allow EPA to continue to calculate and employ a “performance index.” EPA also suggested that NHTSA continue to require both pre- and mid-model year reports. Although it acknowledged that pre-model year reports are, by their nature, incomplete and preliminary, these reports do contain valuable information on projected sales, vehicle performance, and vehicle characteristics.

EPA also noted that one of the aspects of the NHTSA proposal that had been favored by commenters—the direct concurrent submission of fuel economy reports to both agencies—was recently addressed in a rule issued by the EPA. In that rulemaking (64 FR 23976), EPA modified 40 CFR 600.512-01(a) to require reports to be submitted to NHTSA at the same time they are submitted to the EPA.

The agency proposal sought to amend Part 537 to simplify the requirements for the submission of fuel economy reports. After review of the comments submitted in response to that proposal and discussions between NHTSA and the EPA, it has become apparent that the agency's proposal would add additional burdens to manufacturers and increase their reporting costs while depriving EPA of some of the information it needs to complete its mission.

For the reasons stated above, NHTSA is terminating this rulemaking action.