[Federal Register Volume 67, Number 95 (Thursday, May 16, 2002)]
[Rules and Regulations]
[Pages 34848-34851]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-12253]


=======================================================================
-----------------------------------------------------------------------

FEDERAL COMMUNICATIONS COMMISSION

47 CFR Parts 1 and 90

[WT Docket No. 99-87; FCC 02-82]


Implementation of Sections 309(j) and 337 of the Communications 
Act of 1934 as Amended

AGENCY: Federal Communications Commission.

ACTION: Final rule.

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

SUMMARY: In this document, the Commission addresses petitions for 
reconsideration and related pleadings regarding certain decisions in 
this proceeding. It affirms its earlier decisions, and revises certain 
rules concerning its statutory auction authority and the licensing of 
private land mobile channels in the 800 MHz band for use in commercial 
systems. This action by the Commission implements the Communication Act 
of 1934 as amended by Congress.

DATES: Effective July 15, 2002.

FOR FURTHER INFORMATION: Karen Franklin of the Public Safety and 
Private Wireless Division at (202) 418-0680, Wireless 
Telecommunications Bureau, Federal Communications Commission, 
Washington, DC 20554.

SUPPLEMENTARY INFORMATION: This is a summary of the Federal 
Communications Commission's Memorandum Opinion and Order, FCC 02-82, 
adopted on March 14, 2002, and released on April 18, 2002. The full 
text of this Memorandum Opinion and Order is available for inspection 
and copying during normal business hours in the FCC Reference Center, 
Room CY-A257, 445 12th Street, SW., Washington, DC 20554. The complete 
text may be purchased from the Commission's copy contractor, Qualex 
International, 445 12th Street, SW., Room CY-B402, Washington, DC 
20554. The full text may also be downloaded at: www.fcc.gov. 
Alternative formats are available to persons with disabilities by 
contacting Brian Millin at (202) 418-7426 or TTY (202) 418-7365.
    1. In the Report and Order and Further Notice of Proposed Rule 
Making (``R&O'' and ``FNPRM''), 66 FR 86, January 2, 2001, in this 
proceeding, the Commission adopted rules and policies to implement 
Sections 309(j) and 337 of the Communications Act of 1934, as amended 
by the Balanced Budget Act of 1997. This Memorandum Opinion and Order 
(``MO&O'') addresses petitions for reconsideration and related 
pleadings regarding certain of our decisions in the R&O.
    2. The major decisions in this MO&O are as follows:
     The Commission affirms that the Balanced Budget Act 
amendments to Section 309(j) do not preclude the Commission from using 
licensing mechanisms for private services that permit the filing of 
mutually exclusive license applications if the Commission determines 
that it is in the public interest to do so.
     Commission reiterates that the public safety radio 
services exemption in Section 309(j) applies to services, rather than 
specific users. Moreover, we affirm the dominant use test set forth in 
the R&O as the means to determine whether the particular service 
qualifies for the public safety radio services exemption. We also 
retain and clarify the definition for ``private internal radio 
service'' set forth in the R&O.
     The Commission retains the five-year holding period as a 
requirement for modification of an 800 MHz PLMRS authorization to 
permit commercial use.
     The Commission affirms the decision in the R&O that an 
applicant must demonstrate that there is no public safety spectrum 
available to satisfy the public safety service use before it can be 
granted a waiver pursuant to Section 337.
     The Commission reiterates whether a Section 337 
application is in the public interest will be determined on a case-by-
case examination of various factors, including the stage of the 
competitive bidding process with respect to the requested frequencies.
    3. The MO&O also updates Sec. 1.227 of the Commission's Rules, 
regarding mutually exclusive applications, to reflect that the 
Commission no longer utilizes random selection processes to resolve 
such conflicts, and has indicated that it will rely on existing 
regulatory tools to resolve rare instances of mutually exclusive 
applications in services that are not subject to competitive bidding. 
Finally, it revises Sec. 90.621 permitting modification, assignment or 
transfer of private land mobile radio licenses for commercial use, to 
require such applications to be filed in accordance with the rules and 
procedures for commercial stations, and to clarify that a licensee that 
has modified its authorization for use in a

[[Page 34849]]

commercial operation, or a commercial operator that acquired PLMR 
channels via assignment or transfer, may at anytime submit a 
modification application to indicate that the subject frequencies will 
be used in a PLMR system, provided that the licensee meets the 
applicable eligibility requirements.

I. Procedural Matters

A. Final Regulatory Flexibility Act Analysis

    4. As required by the Regulatory Flexibility Act (RFA), see 5 
U.S.C. 604, the Commission has prepared a Supplemental Regulatory 
Flexibility Analysis of the possible impact of the rule changes 
contained in this Memorandum Opinion and Order on small entities. The 
Supplemental Regulatory Flexibility Analysis is set forth in paragraph 
six. The Commission's Consumer Information Bureau, Reference 
Information Center, will send a copy of this Memorandum Opinion and 
Order, including the Supplemental Final Regulatory Flexibility Act 
Analysis, to the Chief Counsel for Advocacy of the Small Business 
Administration.

B. Paperwork Reduction Act of 1995 Analysis

    5. This Memorandum Opinion and Order does not contain any new or 
modified information collection. Therefore, it is not subject to the 
requirements for a paperwork reduction analysis, and the Commission has 
not performed one.

C. Further Information

    6. For further information concerning this Memorandum Opinion and 
Order, contact Karen Franklin of the Public Safety and Private Wireless 
Division at (202) 418-0680, TTY (202) 418-7233, Wireless 
Telecommunications Bureau, Federal Communications Commission, 
Washington, DC 20554. Alternative formats (computer diskette, large 
print, audio cassette, and Braille) are available to persons with 
disabilities by contacting Jenifer Simpson at (202) 418-0008, TTY (202) 
418-2555. This Memorandum Opinion and Order can be downloaded at http://www.fcc.gov/Wireless/Orders/2001.

II. Supplemental Final Regualatory Flexibility Analysis

    7. As required by the Regulatory Flexibility Act (RFA), Initial 
Regulatory Flexibility Analyses (IRFA) were incorporated in the Notice 
of Proposed Rule Making (NPRM) and Report and Order and Further Notice 
of Proposed Rule Making (R&O and FNPRM) in WT Docket 99-87. The 
Commission sought written public comment on the proposals in the Notice 
and R&O and FNPRM. This Supplemental Final Regulatory Flexibility 
Analysis (SFRFA) contained in this Memorandum Opinion and Order (MO&O) 
is limited to matters raised on reconsideration or clarification with 
regard to the R&O and FNPRM and addressed in this MO&O. This SFRFA 
conforms to the RFA.

I. Reason for, and Objectives of, the Memorandum Opinion and Order

    8. This proceeding was initiated to secure public comment on 
proposals to implement Sections 309(j) and 337 of the Communications 
Act of 1934 (``Communications Act''), as amended by the Balanced Budget 
Act of 1997 (``Balanced Budget Act''). The Balanced Budget Act 
significantly revised Section 309(j) of the Communications Act, which 
is the principal statutory provision that governs the Commission's 
auction authority for the licensing of radio services.

III. Summary of Significant Issues Raised by Public Comments in 
Response to the Previous Final Regulatory Flexibility Analysis

    9. No reconsideration petitions/comments were filed in direct 
response to the previous Final Regulatory Flexibility Analysis (FRFA). 
However, the Commission has reviewed general comments that may impact 
small businesses. The Report and Order in this proceeding determined 
that the statutory changes in Section 309(j)(1) and exemptions in 
Section 309(j)(2) are considered in light of the Commission's 
continuing obligation under Section 309(j)(6)(E) to avoid mutual 
exclusivity and to fulfill the public interest objectives enumerated in 
Section 309(j)(3). The Commission also concluded that in non-exempt 
services, the Commission's authority under the Balanced Budget Act 
continues to permit it to adopt licensing processes that result in the 
filing of mutually exclusive applications where the Commission 
determines that such an approach would serve the public interest. The 
Commission concluded that in addition to other licensing mechanisms we 
have used previously, we should consider the use of band manager 
licensing as a future option for private as well as commercial 
services. In the Report and Order, the Commission determined that the 
public safety exemption applies only to services in which these public 
safety uses, i.e., protection of safety of life, health, and property 
within the meaning of Section 309(j)(2)(A), comprise the dominant use 
of the spectrum. Further, the Commission decided that subject to 
certain safeguards, 800 MHz Business and Industrial/Land Transportation 
licensees should be allowed to modify their licenses to permit 
commercial use, or to assign or transfer their licenses to Commercial 
Mobile Radio Service (CMRS) operators for commercial use. The Report 
and Order provided that Section 337 relief should only be available if 
the applicant demonstrates that there is no available public safety 
spectrum in any band in the geographic area where the public safety use 
is proposed. Moreover, the Commission concluded that it would consider 
the state of the competitive bidding process when the Section 337 
application is received as relevant to our determination of whether 
grant of the waiver request and the associated application(s) is in the 
public interest.
    10. In this Memorandum Opinion and Order, we affirm the 
Commission's determinations. Moreover, we modify the Commission's Rules 
to require Section 337 applicants to enter the service code applicable 
to the type of service they intend to provide. We also note that 
despite the type of service code used, the Section 337 applicant will 
be required to meet the interference protection standards in our rules 
that are applicable to the subject spectrum in order to satisfy Section 
337(c)(1)(B). Additionally, we modify our rules to require that 
applications filed to modify 800 MHz Private Land Mobile Radio (PLMR) 
channels for use in CMRS systems be processed in accordance with CMRS 
rules and procedures instead of PLMR rules and procedures. In that 
connection, we clarify that a licensee that has modified its 
authorization for use in a CMRS operation, or a CMRS operator that 
acquired PLMR channels via assignment or transfer, may at any time 
submit a modification application to indicate that the subject 
frequencies will be used in a PLMR system, provided that the licensee 
meets the applicable eligibility requirements.

IV. Description and Estimate of the Number of Small Entities to 
Which the Rules Apply

    11. The RFA directs agencies to provide a description of and, where 
feasible, an estimate of the number of small entities that may be 
affected by the rules adopted. The RFA generally defines the term 
``small entity'' as having the same meaning as the terms ``small 
business,'' ``small organization,'' and ``small governmental 
jurisdiction.'' In addition, the term ``small business'' has the same 
meaning as the term ``small business concern'' under the

[[Page 34850]]

Small Business Act. A small business concern is one which: (1) is 
independently owned and operated; (2) is not dominant in its field of 
operation; and (3) satisfies any additional criteria established by the 
Small Business Administration (SBA). A small organization is generally 
``any not-for-profit enterprise which is independently owned and 
operated and is not dominant in its field. Nationwide, as of 1992, 
there were approximately 275,801 small organizations.
    12. The rule changes effectuated by this Memorandum Opinion and 
Order apply to licensees who provide public safety services pursuant to 
Section 337 of the Communications Act of 1934, as amended (the Act), 
and private land mobile radio licensees in the 800 MHz band that are 
regulated under Part 90 of the Commission's Rules.

Estimates for PLMR Licensees

    13. Private land mobile radio systems serve an essential role in a 
vast range of industrial business, land transportation and public 
service activities. These radios are used by companies of all sizes 
that operate in all U.S. business categories. Because of the vast array 
of PLMR users, the Commission had not developed, nor would it be 
possible to develop, a definition of small entities specifically 
applicable to PLMR users. For the purpose of determining whether a 
licensee is a small business as defined by the Small Business 
Administration (SBA), each licensee would need to be evaluated within 
its own business area. The Commission's fiscal year 1994 annual report 
indicates that, at the end of fiscal year 1994, there were 1,087,276 
licensees operating 12,481,989 transmitters in the PLMR bands below 512 
MHz. Further, because any entity engaged in a commercial activity is 
eligible to hold a PLMR license, these rules could potentially impact 
every small business in the U.S.

Estimates for Public Safety Radio Services and Governmental Entities

    14. Public Safety radio services include police, fire, local 
governments, forestry conservation, highway maintenance, and emergency 
medical services. The SBA rules contain a definition for small 
radiotelephone (wireless) companies, which encompasses business 
entities engaged in radiotelephone communications employing no more 
that 1,500 persons. There are a total of approximately 127,540 
licensees within these services. Governmental entities as well as 
private businesses comprise the licensees for these services. The RFA 
also includes small governmental entities as a part of the regulatory 
flexibility analysis. ``Small governmental jurisdiction'' generally 
means ``governments of cities, counties, towns, townships, villages, 
school districts, or special districts, with a population of less than 
50,000.'' As of 1992, there were approximately 85,006 such 
jurisdictions in the United States. This number includes 38,978 
counties, cities and towns; of these, 37,566, or 96 percent, have 
populations of fewer than 50,000. The Census Bureau estimates that this 
ratio is approximately accurate for all governmental entities. Thus, of 
the 85,006 governmental entities, the Commission estimates that 81,600 
(91 percent) are small entities.

V. Description of Projected Reporting, Recordkeeping and Other 
Compliance Requirements

    15. This MO&O makes two minor revisions to the compliance 
requirements in Parts 1 and 90 of the Commission's Rules to conform the 
application and licensing procedures in the private land mobile and 
public safety radio services with the policies described in the MO&O. 
One of the amendments requires processing of modification applications 
submitted to convert the use of 800 MHz PLMR channels to use in a CMRS 
operation in accordance with our CMRS rules and procedures. The other 
amendment to our rules requires a Section 337 applicant to enter the 
service code applicable to the type of service the applicant intends to 
provide.

VI. Steps Taken To Minimize Significant Economic Impact on Small 
Entities and Significant Alternatives Considered

    16. The RFA requires an agency to describe any significant 
alternatives that it has considered in reaching its proposed approach, 
which may include the following four alternatives (among others): (1) 
The establishment of differing compliance or reporting requirements or 
timetables that take into account the resources available to small 
entities; (2) the clarification, consolidation, or simplification of 
compliance or reporting requirements under the rule for small entities; 
(3) the use of performance, rather than design, standards; and (4) an 
exemption from coverage of the rule, or any part thereof, for small 
entities.
    17. The Part 1 rule adopted in this MO&O clarifies our policies 
with respect to the processing of applications for licenses in the 
public safety radio services under Section 337 of the Act. The revision 
to Part 1 of the Commission's Rules provides guidance toward accurate 
completion of FCC Form 601. This form requires the applicant to provide 
a service code. Although we did consider allowing a Section 337 
applicant to enter a service code commensurate with the frequency 
allocation, other applicants, frequency coordinators or other licensees 
would not know the type of service provided on the subject frequency. 
Moreover, we observe that selection of a service code is not a unique 
requirement for small business, Section 337 applicants; nor does 
selection of one service code instead of another service code impose an 
additional economic burden.
    18. The Part 90 regulation amended by this MO&O designates the 
rules governing CMRS operations as the rules by which applications 
submitted to convert the use of PLMR channels to use in CMRS operations 
will be processed rather than the rules governing Industrial/Land 
Transportation and Business channels. While a small business, 800 MHz 
PLMR licensee who chooses to convert use of its frequencies and operate 
a CMRS system may have to familiarize itself with the CMRS rules, it is 
incumbent upon this agency, inter alia, to make such regulations as it 
may deem necessary to prevent interference between stations. For 
instance, use of PLMR channels in CMRS operations must comply with the 
interference and technical requirements that govern CMRS operations to 
ensure harmful interference to existing licensees is avoided. 
Similarly, use of PLMR channels in CMRS operations must comply with the 
power limitations and other operational requirements imposed upon other 
CMRS operators to protect licensees from harmful interference.
    Report to Congress: The Commission will send a copy of this 
Memorandum Opinion and Order, including this Supplemental FRFA, in a 
report to be sent to Congress pursuant to the Congressional Review Act, 
see 5 U.S.C. 801(a)(1)(A). In addition, the Commission will send a copy 
of the Memorandum Opinion and Order, including Supplemental FRFA, to 
the Chief Counsel for Advocacy of the Small Business Administration. A 
copy of the Memorandum Opinion and Order and Supplemental FRFA (or 
summaries thereof) will also be published in the Federal Register. See 
5 U.S.C. 604(b).

VII. Ordering Clauses

    19. Pursuant to sections 1, 2, 4(i), 5(c), 7(a), 11(b), 301, 302, 
303, 307, 308, 309(j) , 310, 312a, 316, 319, 323, 324, 332, 333, 336, 
337, and 351 of the Communications Act of 1934, as amended, 47 U.S.C. 
151, 152, 154(i), 155(c), 157(a), 161(b), 301, 302, 303,

[[Page 34851]]

307, 308, 309(j), 310, 312a, 316, 319, 323, 324, 332, 333, 336, 337, 
and 351, the Balanced Budget Act of 1997, Public Law 105-33, Title III, 
111 Stat. 251 (1997), and Secs. 1.421 and 1.425 of the Commission's 
Rules, 47 CFR 1.421 and 1.425, that the Memorandum Opinion and Order is 
hereby ADOPTED.
    20. Parts 1 and 90 of the Commission's Rules ARE AMENDED as set 
forth in Rule Changes, and that these Rules shall be effective July 15, 
2002.
    21. The Petitions for Reconsideration submitted by the following 
parties are DENIED: AllCom, LLC; American Automobile Association; 
Association of Public-Safety Communications Officials-International; 
Central Station Alarm Association; Cinergy Corporation; Commonwealth 
Edison Company; Consolidated Edison Company of New York; Entergy 
Corporation; Kansas City Power & Light Company; Omaha Public Power 
District; SCANA; Union Electric Company and Central Illinois Public 
Service Company and Ameren Energy Generating Company; United Telecom 
Council; and Xcel Energy, Inc.
    22. The Commission's Consumer Information Bureau, Reference 
Information Center, SHALL SEND a copy of this Memorandum Opinion and 
Order, including the Supplemental Regulatory Flexibility Analysis and 
Final Regulatory Flexibility Analysis, to the Chief Counsel for 
Advocacy of the U.S. Small Business Administration.
    23. The Motion to Accept Supplemental Comments submitted by 
Industrial Telecommunications Association, Inc. is GRANTED.

List of Subjects

47 CFR Part 1

    Administrative practice and procedure, Radio.

47 CFR Part 90

    Communications equipment, Radio, Reporting, Recordkeeping 
requirements.

Federal Communications Commission.
Marlene H. Dortch,
Secretary.

Rule Changes

    For the reasons discussed in the preamble, the Federal 
Communications Commission amends 47 CFR parts 1 and 90 as follows:

PART 1--PRACTICE AND PROCEDURE

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

    Authority: 47 U.S.C. 151, 154(i), 154(j), 155, 225, 303(r), 309 
and 325(e).


    1. Section 1.227 is amended by revising paragraphs (b)(3)(ii) and 
(b)(4) to read as follows:


Sec. 1.227  Consolidations.

* * * * *
    (b) * * *
    (3) * * *
    (ii) Domestic public fixed and public mobile. See Rule Sec. 21.31 
of this chapter for the requirements as to mutually exclusive 
applications. See also Rule Sec. 21.23 of this chapter for the 
requirements as to amendments of applications.
* * * * *
    (4) This paragraph applies when mutually exclusive applications 
subject to section 309(b) of the Communications Act and not subject to 
competitive bidding procedures pursuant to Sec. 1.2102 of this chapter 
are filed in the Private Radio Services, or when there are more such 
applications for initial licenses than can be accommodated on available 
frequencies. Except for applications filed under part 101, subparts H 
and O, Private Operational Fixed Microwave Service, and applications 
for high seas public coast stations (see Secs. 80.122(b)(1) (first 
sentence), 80.357, 80.361, 80.363(a)(2), 80.371(a), (b), and (d), and 
80.374 of this chapter), mutual exclusivity will occur if the later 
application or applications are received by the Commission's offices in 
Gettysburg, PA (or Pittsburgh, PA for applications requiring the fees 
set forth at part 1, subpart G of the rules) in a condition acceptable 
for filing within 30 days after the release date of public notice 
listing the first prior filed application (with which subsequent 
applications are in conflict) as having been accepted for filing or 
within such other period as specified by the Commission. For 
applications in the Private Operational Fixed Microwave Service, mutual 
exclusivity will occur if two or more acceptable applications that are 
in conflict are filed on the same day. Applications for high seas 
public coast stations will be processed on a first come, first served 
basis, with the first acceptable application cutting off the filing 
rights of subsequent, conflicting applications. Applications for high 
seas public coast stations received on the same day will be treated as 
simultaneously filed and, if granting more than one would result in 
harmful interference, must be resolved through settlement or technical 
amendment.
* * * * *

    2. Section 1.913 is amended by revising paragraph (g) to read as 
follows:


Sec. 1.913  Application forms; electronic and manual filing.

* * * * *
    (g) Section 337 Requests. Applications to provide public safety 
services submitted pursuant to 47 U.S.C. 337 must be filed on the same 
form and in the same manner as other applications for the requested 
frequency(ies), except that applicants must select the service code 
reflective of the type of service the applicant intends to provide.

PART 90--PRIVATE LAND MOBILE RADIO SERVICES

    3. The authority citation for Part 90 continues to read as follows:

    Authority: Sections 4(i), 11, 303(g), 303(r) and 332(c)(7) of 
the Communications Act of 1934, as amended, 47 U.S.C. 154(i), 161, 
303(g), 303(r), 332(c)(7).


    4. Section 90.621 is amended by revising paragraph (e)(2) 
introductory text and adding paragraph (e)(3) to read as follows:


Sec. 90.621  Selection and assignment of frequencies.

* * * * *
    (e) * * *
    (2) Notwithstanding paragraph (e)(5) of this section, licensees of 
channels in the Industrial/Land Transportation and Business categories 
may request a modification of the license, see Sec. 1.947 of this part, 
to authorize use of the channels for commercial operation. The licensee 
may also, at the same time or thereafter, seek authorization to 
transfer or assign the license, see Sec. 1.948 of this part, to any 
person eligible for licensing in the General or SMR categories. 
Applications submitted pursuant to this paragraph must be filed in 
accordance with the rules governing other applications for commercial 
channels, and will be processed in accordance with those rules. Grant 
of requests submitted pursuant to this paragraph is subject to the 
following conditions:
* * * * *
    (3) Licensees granted authorizations pursuant to paragraph (e)(2) 
of this section may at any time request modification of the license to 
authorize use of the channels consistent with the rules governing the 
category to which they are allocated, provided that the licensee meets 
the applicable eligibility requirements.
* * * * *
[FR Doc. 02-12253 Filed 5-15-02; 8:45 am]
BILLING CODE 6712-01-P