[Federal Register Volume 70, Number 139 (Thursday, July 21, 2005)]
[Rules and Regulations]
[Pages 41967-41995]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-14267]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 1

[MD Docket Nos. 05-59 and 04-73; FCC 05-137]


Assessment and Collection of Regulatory Fees for Fiscal Year 
2005; Assessment and Collection of Regulatory Fees for Fiscal Year 2004

AGENCY: Federal Communications Commission.

ACTION: Final rule.

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SUMMARY: In this document, we conclude a proceeding to collect 
$280,098,000 in regulatory fees for Fiscal Year (FY) 2005. These fees 
are mandated by Congress and are collected to recover the regulatory 
costs associated with the Commission's enforcement, policy and 
rulemaking, user information, and international activities. We also 
deny the petition for reconsideration filed by Cingular Wireless LLC of 
the Commission's FY 2004 Report and Order.

DATES: Effective August 22, 2005.

FOR FURTHER INFORMATION CONTACT: Roland Helvajian, Office of Managing 
Director at (202) 418-0444 or Rob Fream, Office of Managing Director at 
(202) 418-0408.

SUPPLEMENTARY INFORMATION:
    Adopted: July 1, 2005.
    Released: July 7, 2005.
    By the Commission: Commissioner Copps concurring and issuing a 
statement; Commissioner Adelstein approving in part, concurring in 
part, and issuing a statement.

                            Table of Contents
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                                                              Paragraph
                          Heading                                No.
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I. Introduction...........................................             1
II. Discussion............................................             2
    A. Development of FY 2005 Fees........................             2
        1. Calculation of Revenue and Fee Requirements....             2
        2. Additional Adjustments to Payment Units........             3
        3. Commercial Mobile Radio Service (CMRS)                      5
         Messaging Service................................
        4. Local Multipoint Distribution Service (LMDS)...             6
        5. International Bearer Circuits..................             8
        6. Regulatory Fees for Direct Broadcast Service               10
         (DBS) Providers and Cable Television Operators...
        7. Multichannel Video Distribution and Data                   12
         Service (MVDDS)..................................
        8. Broadband Radio Service (BRS) / Educational                13
         Broadband Service (EBS), (formerly MDS/MMDS and
         ITFS)............................................
        9. Regulatory Fees for AM and FM Construction                 14
         Permits..........................................
        10. Clarification of Policies and Procedures......            16
            a. Ad Hoc Issues Concerning Our Regulatory Fee            16
             Exemption Policies...........................
            b. Regulatory Fee Obligations for Digital                 23
             Broadcasters.................................
            c. Regulatory Fee Obligations for AM Expanded             24
             Band Broadcasters............................
            d. Effective Date of Payment of Multi-Year                26
             Wireless Fees................................
        11. Notification, Assessment and Collection of                27
         Regulatory Fees..................................
            a. Interstate Telecommunications Service                  29
             Providers (ITSPs)............................
            b. Satellite Space Station Licensees..........            31
            c. Media Services Licensees...................            34
            d. Cable Television Subscribers...............            36
    B. FY 2005 Fee Determination and FY 2004                          38
     Reconsideration......................................
        12. Commercial Mobile Radio Service (CMRS)                    38
         Providers........................................
III. Procedural Matters...................................            45
    A. Payment of Regulatory Fees.........................            45
        1. De Minimis Fee Payment Liability...............            45
        2. Standard Fee Calculations and Payment Dates for            46
         Annual Regulatory Fees...........................
        3. Limitations on Credit Card Transactions........            48
    B. Enforcement........................................            49
    C. Congressional Review Act Analysis..................            51
IV. Ordering Clauses......................................            52
Attachments:
    Attachment A Final Regulatory Flexibility Analysis
    Attachment B Sources of Payment Unit Estimates for
     FY2005
    Attachment C Calculation of Revenue Requirements and
     Pro-Rata Fees
    Attachment D FY 2005 Schedule of Regulatory Fees
    Attachment E Factors, Measurements, and Calculations
     that Determine Station Contours and Population
     Coverages
    Attachment F List of Commenters
    Attachment G FY 2004 Schedule of Regulatory Fees
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[[Page 41968]]

I. Introduction

    1. In this Order, we conclude a proceeding to collect $280,098,000 
in regulatory fees for Fiscal Year (FY) 2005. These fees are mandated 
by Congress and are collected to recover the regulatory costs 
associated with the Commission's enforcement, policy and rulemaking, 
user information, and international activities.\2\ We also deny the 
petition for reconsideration filed by Cingular Wireless LLC of the 
Commission's FY 2004 Report and Order.\3\
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    \2\ 47 U.S.C. 159(a).
    \3\ Assessment and Collection of Regulatory Fees for Fiscal Year 
2004, Report and Order, 19 FCC Rcd 11,662 (2004) (FY 2004 Report and 
Order); see infra paras. 38-41.
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II. Discussion

A. Development of FY 2005 Fees

1. Calculation of Revenue and Fee Requirements
    2. As explained below, we adjust our section 9 regulatory fees to 
reflect the requirement to collect $280,098,000 in regulatory fees 
during FY 2005. As described in the FY 2005 NPRM,\4\ this adjusted 
amount is $7,140,000, or approximately 2.6 percent greater than the 
$272,958,000 we were required to collect during the previous fiscal 
year. Each fiscal year, the Commission proportionally allocates the 
total amount that must be collected via regulatory fees. The results of 
this calculation are contained in Attachment C.\5\ For FY 2005, this 
allocation was done using FY 2004 revenues as a base. From this base, a 
revenue amount for each fee category was calculated. Each fee category 
was then adjusted upward by 2.6 percent to reflect the increase in 
regulatory fees from FY 2004 to FY 2005. These FY 2005 amounts were 
then divided by the number of payment units in each fee category to 
determine the unit fee.\6\ In instances of small fees, such as licenses 
that are renewed for a multiyear term, the resulting unit fee was also 
divided by the term of the license. These unit fees were then rounded 
to the nearest $5 or $25 in accordance with 47 U.S.C. 159(b)(2).
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    \4\ See Assessment and Collection of Regulatory Fees for Fiscal 
Year 2005, Notice of Proposed Rulemaking, 70 FR at 9575, 9576, para. 
5, (2005) (FY 2005 NPRM).
    \5\ It is important to note that the required increase in 
regulatory fee payments of approximately 2.6 percent in FY 2005 is 
reflected in the revenue that is expected to be collected from each 
service category. Because this expected revenue is adjusted each 
year by the number of estimated payment units in a service category, 
the actual fee itself is sometimes increased by a number other than 
2.6 percent. For example, in industries where the number of units is 
declining and the expected revenue is increasing, the impact of the 
fee increase may be greater.
    \6\ In most instances, the fee amount is a flat fee per licensee 
or regulatee. However, in some instances the fee amount represents a 
unit subscriber fee (such as for Cable, Commercial Mobile Radio 
Service (CMRS) Cellular/Mobile and CMRS Messaging), a per unit fee 
(such as for International Bearer Circuits), or a fee factor per 
revenue dollar (Interstate Telecommunications Service Provider fee). 
The payment unit is the measure upon which the fee is based, such as 
a licensee, regulatee, subscriber, etc.
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2. Additional Adjustments to Payment Units
    3. In calculating the FY 2005 regulatory fees in Attachment D, we 
further adjusted the FY 2004 list of payment units (Attachment B) based 
upon licensee databases and industry and trade group projections. 
Whenever possible, we verified these estimates from multiple sources to 
ensure the accuracy of these estimates. In some instances, Commission 
licensee databases were used, while in other instances, actual prior 
year payment records and/or industry and trade association projections 
were used in determining the payment unit counts.\7\ Where appropriate, 
we adjusted and/or rounded our final estimates to take into 
consideration variables that may impact the number of payment units, 
such as waivers and/or exemptions that may be filed in FY 2005, and 
fluctuations in the number of licensees or station operators due to 
economic, technical or other reasons. Therefore, when we note that our 
estimated FY 2005 payment units are based on FY 2004 actual payment 
units, we may have rounded the number for FY 2005 or adjusted it 
slightly to account for these variables.
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    \7\ The databases we consulted include, but are not limited to, 
the Commission's Universal Licensing System (ULS), International 
Bureau Filing System (IBFS), and Consolidated Database System 
(CDBS). We also consulted industry sources including but not limited 
to Television & Cable Factbook by Warren Publishing, Inc. and the 
Broadcasting and Cable Yearbook by Reed Elsevier, Inc., as well as 
reports generated within the Commission such as the Wireline 
Competition Bureau's Trends in Telephone Service and the Wireless 
Telecommunications Bureau's Numbering Resource Utilization Forecast 
and Annual CMRS Competition Report. For additional information on 
source material, see Attachment B.
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    4. We consider additional factors to determine regulatory fees for 
AM and FM radio stations. These factors are facility attributes (class 
of service and type (AM or FM) of service), as well as the population 
served by the radio station. Calculating the population served for each 
radio station is determined by coupling current U.S. Census Bureau data 
with technical and engineering data, as detailed in Attachment E. 
Consequently, the class and type of service, as well as the population 
served, determine the regulatory fee amount to be paid.
3. Commercial Mobile Radio Service (CMRS) Messaging Service
    5. In the FY 2005 NPRM, the Commission proposed to continue its 
policy of maintaining the CMRS Messaging Service regulatory fee at the 
rate calculated in FY 2003 and FY 2004 to avoid further contributing to 
the financial hardships associated with a declining subscriber base.\8\ 
We received no comments or reply comments on this matter. Consequently, 
we will maintain the CMRS Messaging Service regulatory fee at $0.08 per 
subscriber.
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    \8\ See FY 2005 NPRM, 70 FR at 9576, para. 5.
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4. Local Multipoint Distribution Service (LMDS)
    6. In the FY 2004 proceeding, the Commission identified a 
difference in treatment between LMDS Block A and Block B licensees for 
the purposes of assessing section 9 regulatory fees. This difference 
resulted in a disproportionately higher fee obligation on LMDS Block B 
licenses when compared on a per-megahertz (MHz) basis.\9\ As a result, 
in the FY 2005 NPRM, we proposed to amend the fee schedule and assess 
LMDS regulatory fees on a flat MHz basis.\10\ We received two comments 
on this proposal. These commenters oppose the proposal to collect LMDS 
regulatory fees on a per-MHz basis, arguing that the Commission cannot 
use a per-MHz regulatory fee for LMDS without using the same fee 
methodology for the 24 GHz and 39 GHz services.\11\ We decline to adopt 
a per-MHz fee methodology for LMDS at this

[[Page 41969]]

time, and we will therefore retain our existing methodology for 
assessing LMDS fees for FY 2005.\12\
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    \9\ FY 2004 Report and Order, 19 FCC Rcd 11,662, 11,669, para. 
16. Block A licenses are authorized for 1150 MHz of spectrum, while 
Block B licenses are authorized for 150 MHz of spectrum. Using the 
authorized bandwidth for each license as the basis for comparison, 
the Commission noted that the regulatory fee for Block B licenses in 
FY 2004 was significantly higher on a per-MHz basis than the fee for 
Block A licenses. On a per-MHz basis, Block B licensees, which are 
authorized for 150 MHz in the 31,000-31,075/31,225-31,300 MHz bands, 
paid regulatory fees equivalent to $1.80 per MHz ($270 divided by 
150 MHz) in FY 2004, while Block A licensees, which are authorized 
for 1150 MHz of spectrum, paid the equivalent $0.24 per MHz ($270 
divided by 1150 MHz).
    \10\ FY 2005 NPRM, 70 FR at 9577, para. 7. The Commission 
proposed to set a per-MHz per unit fee of $0.44 for LMDS licensees, 
and then multiply the unit fee by the amount of bandwidth authorized 
for Block A and Block B licenses. As proposed, in FY 2005 the 
regulatory fee amount for Block A licensees would have been $0.44 
multiplied times 1150 MHz = $506, rounded to $505; while the amount 
for Block B licensees would have been $0.44 multiplied times 150 MHz 
= $66, rounded to $65.
    \11\ Comments of XO Communications (XO), at 2-7; Comments of the 
Law Firm of Blooston, Mordkofsky, Dickens, Duffy & Prendergast 
(BMDDP), at 2-4.
    \12\ However, we may revisit the per-MHz and other fee 
methodologies in the future.
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    7. The commenters also argued that LMDS should be reclassified for 
fee assessment purposes as a microwave service.\13\ The Commission 
determined in its FY 2003 fee proceeding that LMDS was developing on a 
separate track from microwave services and that it should be moved into 
a separate fee category.\14\ The Commission subsequently rejected 
arguments to place LMDS in the microwave fee category in the FY 2004 
Report and Order.\15\ XO and BMDDP have presented no new evidence or 
arguments that would cause us to reconsider that decision. We find no 
compelling reason to reclassify LMDS as a microwave service, which 
would reduce the LMDS annual fee by more than 80 percent, and thereby 
impose a disproportionate financial burden on fee payers in other 
service categories. We therefore will maintain the existing regulatory 
fee classification for LMDS for FY 2005.
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    \13\ XO Comments at 2-5; BMDDP Comments at 4-5.
    \14\ Assessment and Collection of Regulatory Fees for Fiscal 
Year 2003, Report and Order, 18 FCC Rcd 15,985, 15,989, at para. 9 
(2003) (FY 2003 Report and Order).
    \15\ FY 2004 Report and Order, 19 FCC Rcd at 11,669, para. 16.
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5. International Bearer Circuits
    8. We decline to change or modify the methodology for assessing 
regulatory fees for international carriers at this time. In the FY 2005 
NPRM, we sought comment on possible changes to the regulatory fees 
assessed on international carriers.\16\ Only three parties filed 
comments and/or reply comments on this matter.\17\ The Commission 
currently assesses regulatory fees on international carriers based on 
the number of active international bearer circuits the carrier had the 
previous year.\18\
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    \16\ FY 2005 NPRM, 70 FR at 9577, 9578, paras. 11-17.
    \17\ Tyco filed comments and reply comments, SIA filed comments 
and Level 3 filed reply comments that addressed the international 
bearer circuit issue. The parties generally argued that the current 
methodology for assessing regulatory fees on the number of active 
circuits favors older, lower capacity systems, and a fee system 
based on cable landing licenses and international section 214 
authorizations would be administratively simpler and provide an 
incentive for carriers to initiate new services.
    \18\ Regulatory fees for International Bearer Circuits are to be 
paid by facilities-based common carriers that have active 
international bearer circuits in any transmission facility for the 
provision of service to an end user or resale carrier, which 
includes active circuits to themselves or to their affiliates. In 
addition, non-common carrier satellite operators must pay a fee for 
each circuit sold or leased to any customer, including themselves or 
their affiliates, other than an international common carrier 
authorized by the Commission to provide U.S. international common 
carrier services. Non-common carrier submarine cable operators are 
also to pay fees for any and all international bearer circuits sold 
on an indefeasible right of use (IRU) basis or leased to any 
customer, including themselves or their affiliates, other than an 
international common carrier authorized by the Commission to provide 
U.S. international common carrier services. See Assessment and 
Collection of Regulatory Fees for Fiscal Year 2001, MD Docket No. 
01-76, Report and Order, 16 FCC Rcd 13525, 13593 (2001); Regulatory 
Fees Fact Sheet: What You Owe--International and Satellite Services 
Licensees for FY 2004 at 3 (rel. July 2004) (the fact sheet is 
available on the FCC Web site at: http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-249904A4.pdf).
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    9. We are not persuaded by these commenters that a significant 
change to our section 9 regulatory fee assessment methodology for 
international bearer circuits is warranted at this time, or that the 
benefits of changing our assessment methodology outweigh the costs of 
modifying our systems and processes at this time. We decline to adopt 
the Tyco proposal to create a new, separate fee category for non-common 
carrier cable landing licensees at this time.\19\ As a practical 
matter, we note that we have at present no acceptable methodology for 
allocating fee requirement between categories of payers.\20\ Even if we 
had an acceptable methodology, we would not be able to undertake the 
required analysis in time for FY 2005 fee payments and still comply 
with the section 9(b)(3) notification requirement. Moreover, because 
creating a new section 9 regulatory fee category would impact other 
international carriers, we would want to address the issue of 
regulatory fee payments by international carriers as a whole and not 
make discrete changes for one category of payers at this time. In 
addition, we conclude that Tyco's main concern is addressed by 
modifying the section 9 regulatory fee for international bearer 
circuits rather than creating an entirely new category of section 9 
regulatory fees. To that end, we note that these fees have declined 
substantially, due to increased capacity in the active circuit market: 
The FY 2005 section 9 fee assessment of $1.37 per 64 kbps circuit is 
just over half the $2.52 per 64 kbps circuit fee adopted for FY 2004, 
and is 32% below the $2.01 per 64 kbps circuit proposed in the FY 2005 
NPRM. For these reasons, we find that it would not be appropriate to 
change the fee assessment for international carriers for FY 2005. We 
note that in the FY 2005 NPRM, we stated that we would not implement 
any changes to the bearer circuit fee assessment methodology for this 
FY 2005 collection cycle.\21\
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    \19\ Tyco Comments at 7-8. We may revisit this determination in 
the regulatory fee proceeding for FY 2006.
    \20\ Tyco proposes that the Commission use either employee or 
employee-hour equivalents to establish the regulatory fee 
requirements for non-common carrier cable landing licensees. Tyco 
Comments at 23-25.
    \21\ FY 2005 NPRM, 70 FR at 9578, para. 16.
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6. Regulatory Fees for Direct Broadcast Service (DBS) Providers and 
Cable Television Operators
    10. We decline to modify the FY 2005 regulatory fee assessment 
methodology for DBS providers in response to the comments of the 
National Cable and Telecommunications Association (NCTA) and American 
Cable Association (ACA). NCTA argues that cable operators pay a 
disproportionately larger amount of the Commission's regulatory fees as 
compared to DBS providers, despite the fact that they are similarly 
situated competitors.\22\ NCTA proposes that the Commission adopt the 
same per-subscriber assessment for DBS operators that applies to cable 
television operators. DirecTV, Inc. and Echostar Satellite L.L.C. 
(DirecTV & Echostar), in joint reply comments, argue that the cable 
operators have failed to make the required showing to satisfy the legal 
standard in section 9 of the Act for changes to the Commission's 
regulatory fee structure.\23\ DirecTV and Echostar further argue that 
the costs to the Commission of regulating cable exceed those associated 
with DBS.\24\
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    \22\ Comments of NCTA at 4-8. See also ACA Comments at 2-3 
(arguing that the difference in regulatory fee treatment increases 
the burden on cable operators in small markets).
    \23\ Reply Comments of DirectTV and Echostar at 3.
    \24\ Id. at 5.
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    11. We agree that the cable commenters have not made a compelling 
argument, consistent with the standard set forth in section 9(b)(3) for 
``permitted amendments'', to justify a change to the section 9 
regulatory fees for DBS operators. Moreover, the Commission has not 
provided notice for a change to the fee methodology for DBS operators. 
However, the Commission may seek further information on this issue 
during FY 2006 in order to fully explore whether there is a legal basis 
for such a change and to analyze the impact of any change in the 
methodology used to assess fees both for DBS providers and cable 
television operators. Therefore, for FY 2005, we will continue to use 
our current methodology for assessing regulatory fees for cable 
television operators and DBS operators.

[[Page 41970]]

7. Multichannel Video Distribution and Data Service (MVDDS)
    12. We decline to establish a MVDDS regulatory fee category at this 
time. In our FY 2005 NPRM, we proposed that, since MVDDS licenses were 
first awarded in 2004 and equipment is still under development, we 
would not establish MVDDS as a new regulatory fee category in FY 
2005.\25\ We received no comments or reply comments on this matter. We 
therefore adopt our proposal and will not establish a MVDDS regulatory 
fee category for FY 2005.
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    \25\ FY 2005 NPRM, 70 FR at 9579, para. 21.
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8. Broadband Radio Service (BRS)/Educational Broadband Service (EBS) 
(Formerly MDS/MMDS and ITFS)
    13. We note that the BRS/EBS proceeding is currently pending.\26\ 
As we stated in the FY 2005 NPRM, we are exploring regulatory fee 
assessment issues for BRS/EBS in that proceeding.\27\ To the extent we 
adopt any changes to our regulatory fee rules in that proceeding, such 
changes will not be effective in time for the FY 2005 regulatory fee 
assessments. We expect to make any appropriate adjustments in the FY 
2006 regulatory fee cycle or later.
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    \26\ See Amendment of Parts 1, 21, 73, 74 and 101 of the 
Commission's Rules to Facilitate the Provision of Fixed and Mobile 
Broadband Access, Educational and Other Advanced Services in the 
2150-2162 and 2500-2690 MHz Bands et al., Report & Order and Further 
Notice of Proposed Rulemaking, 19 FCC Rcd 14165, 14293-97 (2004) 
(R&O and FNPRM).
    \27\ FY 2005 NPRM, 70 FR at 9579, paras. 22-23.
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9. Regulatory Fees for AM and FM Construction Permits
    14. At the inception of our regulatory fee program in FY 1994, the 
regulatory fee amount for construction permits was set at an amount 
that, when compared to licensed stations, was commensurate to the 
limited nature of station operations under the terms of a construction 
permit. However, since 1994, the amount of fees that we have been 
directed to collect each year has steadily increased, while the number 
of estimated payment units for these construction permits has steadily 
decreased. This combination of increasing expected revenue and 
decreasing payment units for these construction permits has resulted in 
a regulatory unit fee that is higher than that of some licensed 
stations.
    15. To rectify this situation, we proposed to set the AM, FM, VHF, 
and UHF construction permit fee to be no higher than the regulatory fee 
associated with the lowest licensed station for that fee category, 
noting that because there are unit and revenue variables in assessing 
the per-unit regulatory fee, it may be necessary to make revenue 
adjustments each fiscal year to keep the per unit regulatory fee for 
construction permits at the level of the lowest licensed fee for AM, 
FM, VHF, and UHF stations. We did not receive any comments or reply 
comments on this matter. Therefore, beginning in FY 2005, we will hold 
fee amounts for construction permits in each respective fee category 
(e.g., AM, FM, VHF and UHF stations) to levels no higher than the 
lowest fee amounts for licensed facilities in each respective fee 
category, and if necessary, will make adjustments across only a narrow 
group of media fee categories, such as AM, FM, VHF and UHF stations, to 
keep the level of the lowest respective licensed fee.
10. Clarification of Policies and Procedures
a. Ad Hoc Issues Concerning Our Regulatory Fee Exemption Policies
    16. Pursuant to 47 CFR 1.1162, the Commission does not establish 
regulatory fees for applicants, permittees, and licensees who qualify 
as government entities or non-profit entities. Despite the language of 
47 CFR 1.1162, we still frequently encounter uncertainty and comments 
from parties with respect to our fee exemption policies. In our FY 2005 
NPRM, we proposed certain clarifications to our exemption policies.\28\ 
We received no comments or reply comments regarding our fee exemption 
policies. Therefore, we will be incorporating these clarifications into 
the text of the regulatory fee public notices that are generated each 
year prior to the collection of regulatory fees.
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    \28\ FY 2005 NPRM, 70 FR at 9579, 9580, paras. 26-30.
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    17. Terminology: In the ensuing discussion, ``facility'' includes 
``station'' and ``licensee'' includes ``permittee.'' ``October 1'' 
means the close of business on October 1, the first day of the 
government fiscal year. ``Fee Due Date'' means the close of business on 
the day determined to be the final date by which regulatory fees must 
be paid. The Fee Due Date usually occurs in August or September. An 
``Exempt Entity'' is a legal entity that is relieved of the burden of 
paying annual regulatory fees.
    18. Determination of Fee Code for a Facility: The fee code is 
determined by the operational status of the facility as of October 1 of 
each year. This involves factors such as whether the facility is in a 
Construction Permit (CP) or Licensed status and a variety of other 
factors. Every facility has a fee code.
    19. Facility Changes During the Year: There is no prorating of 
regulatory fees. For example, if a facility is in construction permit 
status as of the close of business October 1, but a license is granted 
on or after October 2, that facility is considered to be in 
construction permit status for the entire year. Other facility changes 
during the course of the year, such as technical changes, are treated 
in the same manner.
    20. Establishment of Exempt Status: State, local, and Federal 
government agencies and IRS-certified not-for-profit entities are 
generally exempt from payment of regulatory fees. The Commission 
requires that each exempt entity have on file a valid IRS Determination 
Letter or certification from a government authority documenting its 
exempt status. In instances where there is a question regarding the 
exempt status of an entity, the FCC may request, at any time, for the 
entity to submit an IRS Determination Letter or certification from a 
government authority that documents its exempt status.
    21. Subsidiaries of Exempt Entities: The licensee of a facility may 
be distinct from the ultimate owner. Exempt entities may hold one or 
more licenses for media facilities directly and/or through 
subsidiaries. Facilities licensed directly to an exempt entity and its 
exempt subsidiaries are excused from the regulatory fee obligation. 
However, licensees that are for-profit subsidiaries of exempt entities 
are subject to regulatory fees regardless of the exempt status of the 
ultimate owner.

Examples

    A University owns a commercial facility whose profits are used to 
support the University and/or its programs. If the facility is licensed 
to the University directly, or to an exempt subsidiary of the 
University, it is exempt from regulatory fees. If, however, the license 
is held by a for-profit subsidiary, regulatory fees are owed, even 
though the University is an exempt entity.
    A state pension fund is the majority owner of a for-profit 
commercial broadcasting firm. The facilities licensed to the for-profit 
broadcasting firm would be subject to regulatory fees, even though it 
is owned by an exempt agency.
    22. Responsible Party, and the Effects of Transfers of Control: The 
entity holding the license for a facility as of the Fee Due Date is 
responsible for the regulatory fee for that facility. Eligibility for a 
regulatory fee exemption is determined by the status of the licensee

[[Page 41971]]

as of the Fee Due Date, regardless of the status of any previous 
licensee(s).
b. Regulatory Fee Obligations for Digital Broadcasters
    23. In our FY 2005 NPRM, we noted that our current schedule of 
regulatory fees does not include service categories for digital 
broadcasters.\29\ Licensees in the broadcast industry pay regulatory 
fees based on their analog facilities. For licensees that broadcast in 
both the analog and digital formats, the only regulatory fee obligation 
at the present time is for their analog facility. Moreover, a licensee 
that has fully transitioned to digital broadcasting and has surrendered 
its analog spectrum would have no regulatory fee obligation under the 
current fee regime. We sought comment on whether to establish a 
regulatory fee category for digital broadcasters, but received no 
comments or reply comments on this matter.\30\ At this time, we will 
maintain the regulatory fee obligation that applies only for the analog 
facility.
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    \29\ Id. at 9580, para. 31.
    \30\ Id., para. 33.
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c. Regulatory Fee Obligations for AM Expanded Band Broadcasters
    24. We do not require AM Expanded Band radio stations to pay 
section 9 regulatory fees for their expanded band AM station at this 
time. In the FY 2005 NPRM, we proposed to clarify this point and to 
explain that licensees that operate a standard band AM station (540-
1600 kHz) that is linked to an AM Expanded Band station are subject to 
regulatory fees for their standard band station only.\31\ We recognized 
uncertainty about the regulatory fee status in the industry that 
resulted from the fact that AM Expanded Band radio service is not among 
the Commission's categories of general exemptions from regulatory fees 
specified in the Commission's rules.\32\ We received no comments or 
reply comments on this matter.
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    \31\ Id., para. 34-36.
    \32\ 47 CFR 1.1162.
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    25. We will continue to refrain from requiring AM Expanded Band 
radio stations to pay section 9 regulatory fees for their stations. 
However, we note that our decision not to require section 9 regulatory 
fee payments for AM Expanded Band stations is not a permanent exemption 
from regulatory fees for AM Expanded Band Radio Service. Because the 
movement to the expanded band is voluntary and helps to reduce 
interference in the standard bandwidth, we will continue our policy of 
not subjecting this relatively small group of stations to regulatory 
fees. However, at some future point when the migration of standard band 
broadcasters to the Expanded Band has advanced, we may consider 
establishing Sec.  9 regulatory fee requirements for AM Expanded Band 
stations.
d. Effective Date of Payment of Multi-Year Wireless Fees
    26. The first eleven fee categories in our Attachment D, Schedule 
of Regulatory Fees, constitute a general fee category known as multi-
year wireless fees. Regulatory fees for this category are generally 
paid in advance, and for the amount of the entire 5-year or 10-year 
term of the license. Because regulatory fees are paid at the time of 
license renewal (or at the time of a new application), these fees can 
be paid at any time during the fiscal year. As a result, there has been 
some confusion as to the regulatory fee rate that should apply at the 
time of license renewal. Current fiscal year regulatory fees generally 
become effective 30 or 60 days after publication of the fees Order in 
the Federal Register, or in some instances, 90 days after delivery of 
the Order to Congress. Current procedures regarding the renewal of 
multi-year wireless fees stipulate that licensees may submit their fee 
payments no more than 90 calendar days prior to the expiration of their 
licenses. The regulatory fee rate that applies at the time of renewal 
(or at the time of an application for a new license) depends on the 
date that payment is physically received within the 90 day period, and 
how this date relates to the ``effective date'' of the current fiscal 
year regulatory fees. Generally, the ``effective date'' of the current 
fiscal year regulatory fees is published in our fee public notices soon 
after the Order is released. If the renewal payment (or application of 
a new license) is physically received before the ``effective date,'' 
the prior fiscal year regulatory fee rate applies. If the renewal 
payment (or application of a new license) is physically received on or 
after the ``effective date'', the current fiscal year regulatory fee 
rate applies.
11. Notification, Assessment and Collection of Regulatory Fees
    27. Each year, we generate public notices and fact sheets that 
notify regulatees of the fee payment due date and provide additional 
information regarding regulatory fee payment procedures. Accordingly, 
in FY 2005, as in prior years, we will make available to all regulatees 
these public notices, fact sheets and other relevant fee payment 
information on our Web site at http://www.fcc.gov/fees/regfees.html. In 
the event that regulatees do not have access to the Internet, we will 
mail public notices and other relevant materials upon request. 
Regulatees and the general public may request such information by 
contacting the FCC CORES HelpDesk at (877) 480-3201, Option 4.
    28. In addition to making the above information available on-line 
for all of our regulatees, we proposed in our FY 2005 NPRM to send 
specific regulatory fee assessments or bills by surface mail to 
regulatees in a select group of fee categories.\33\ We are pursuing our 
billing initiatives as part of our effort to modernize our financial 
practices. Eventually, we may expand our billing initiatives to include 
all regulatory fee service categories. For now, based on the results of 
our assessment and billing initiatives from last year, and the 
resources currently available to us, we will proceed with our various 
FY 2005 initiatives as described below.
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    \33\ FY 2005 NPRM, 70 FR at 9575, paras. 38-61. We clarify the 
distinction between an assessment and a bill. An ``assessment'' is a 
proposed statement of the amount of regulatory fees owed by an 
entity to the Commission (or proposed subscriber count to be 
ascribed for purposes of setting the entity's regulatory fee). An 
assessment is not entered into the Commission's accounts receivable 
system as a current debt. A ``bill'' is automatically entered into 
our financial records as a debt owed to the Commission. Bills 
reflect the amount owed and have a due date of the last day of the 
fee payment window. Consequently, if a bill is not paid by the due 
date, it becomes delinquent and is subject to our debt collection 
procedures. See also 47 CFR 1.1161(c), 1.1164(f)(5), 1.1910.
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a. Interstate Telecommunications Service Providers (ITSPs)
    29. In FY 2001, we began sending pre-completed FCC Form 159-W 
assessments to carriers in an effort to assist them in paying the 
Interstate Telecommunications Service Provider (ITSP) regulatory 
fee.\34\ The fee amount on FCC Form 159-W was calculated from the FCC 
Form 499-A report, which carriers are required to submit by April 1st 
of each year. Throughout FY 2002 and FY 2003, we refined the FCC Form 
159-W to simplify the regulatory fee payment process.\35\ In FY 2004, 
we generated and mailed the same pre-completed FCC Form 159-W's to 
carriers under the same dissemination procedures, but we informed them 
that we will be treating the amount due on Form 159-W as a bill, rather 
than as an

[[Page 41972]]

assessment. Other than the manner in which Form 159-W payments were 
entered into our financial system, carriers experienced no procedural 
changes regarding the use of the FCC Form 159-W when submitting payment 
of their FY 2004 ITSP regulatory fees. In our FY 2005 NPRM, we sought 
comment on this billing initiative and on ways to improve it.
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    \34\ See Assessment and Collection of Regulatory Fees for Fiscal 
Year 2001, Report and Order, 16 FCC Rcd 13525, at 13590, para. 67 
(2001) (FY 2001 Report and Order). See also FCC Public Notice--
Common Carrier Regulatory Fees (August 3, 2001) at 4.
    \35\ Beginning in FY 2002, the Form 159-W included a payment 
section that allowed carriers the opportunity to send in Form 159-W 
in lieu of completing Form 159 Remittance Advice Form.
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    30. We received no comments or reply comments on our ITSP billing 
initiative for FY 2005. We will continue our ITSP, Form 159-W, billing 
initiative in FY 2005.

b. Satellite Space Station Licensees

    31. In FY 2004, for the first time, we mailed regulatory fee bills 
through surface mail to all licensees in our two satellite space 
station service categories. Specifically, geostationary orbit space 
station (``GSO'') licensees received bills for their operational 
satellites; \36\ and non-geostationary orbit space station (``NGSO'') 
licensees received bills for their systems.\37\ In our FY 2005 NPRM, we 
proposed to continue our billing initiative for our GSO and NGSO 
satellite space station categories. We sought comment on this proposal 
and received comments from the Satellite Industry Association 
(``SIA'').
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    \36\ ``Satellites'' are in operation on the first day of the 
fiscal year and not co-located with and technically identical to 
another operational satellite (i.e., not functioning as a spare 
satellite) on the first day of the fiscal year.
    \37\ ``Systems'' are licensed by the Commission and operational 
on the first day of the fiscal year.
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    32. SIA states that its members experienced a wide range of 
problems with our billing system in FY 2004. For example, in some cases 
licensees did not receive a pre-printed bill for all of their space 
stations.\38\ Several satellite operators report that they received 
bills that substantially undercounted the number of space stations for 
which they owed fees. However, the bills that were issued in FY 2004 
lacked call sign information, making it impossible for most operators 
to determine which satellites were missing from their bills. SIA 
offered suggestions for improving the process.\39\
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    \38\ SIA Comments at 11.
    \39\ Id. Specifically, SIA suggests: (1) Licensees should be 
issued a single bill that lists all the space stations for which the 
Commission believes the licensee owes fees; (2) call signs should be 
included on bills so that licensees can verify the accuracy of the 
billing information; (3) procedures should be in place to permit a 
bill to be modified or supplemented if it is incorrect; (4) bills 
should be mailed well in advance of the payment deadline so that 
licensees have a reasonable period to review the bill, seek 
additional information, if needed, and correct any errors prior to 
the payment due date; and (5) the Commission staff members who are 
knowledgeable about satellite licensing should be available to 
assist licensees by answering questions and resolving problems.
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    33. We have modified our Fee Filer online payment system so that it 
will address most of SIA's suggested corrective measures.\40\ We will 
address SIA's other suggestions by generating and mailing the bills at 
the earliest allowable date after this FY 2005 Order becomes effective. 
We will also ensure that we will have knowledgeable staff available to 
assist licensees with their billing questions and to resolve any bill 
disputes.
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    \40\ Although the process of mailing one bill per space station 
will continue unchanged, Fee Filer will automatically find and 
consolidate all regulatory fees which have been billed, based upon 
FCC Registration Number (FRN) and password entered. Information that 
describes each individual fee will include FRN, call sign, and the 
fee amount. This information will be subject to review by the Fee 
Filer user, who can then make modifications, deletions or additions 
online. After the user confirms the details of each fee, he/she may 
print a one-page Remittance Voucher which is to accompany the 
payment. The one-page Remittance Voucher will reflect the total 
payment and the detail applicable to that summary payment.
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c. Media Services Licensees
    34. In our FY 2005 NPRM, we proposed that we would continue to 
generate regulatory fee assessment postcards for media services 
following the same procedures we used in FY 2004. We noted that we mail 
the postcards on a per-facility basis and that they serve to provide 
parties with the fee payment due date and the assessed fee amount for 
the facility (as well as the data attributes that were used to 
determine the amount).\41\ We received no comments or reply comments on 
our proposal. We will continue our assessment initiative for media 
services entities as we originally proposed. Specifically, we will mail 
a single round of postcards to licensees and their other known points 
of contact in our Consolidated Database System (CDBS) and Commission 
Registration System (CORES)--our two official databases for media 
services. By doing so, licensees and their points of contact will all 
be furnished with the same fee information for the facility in 
question. The postcards will direct parties to a Commission-authorized 
Web site to update or correct fee information regarding the facility, 
or to certify their fee-exempt status if need be.\42\ The postcards 
will also provide the telephone number of our FCC CORES Help Desk at 
(877) 480-3201, Option 4, in the event that parties need additional 
assistance.
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    \41\ Fee assessments were issued for AM and FM Radio Stations, 
AM and FM Construction Permits, FM Translators/Boosters, VHF and UHF 
Television Stations, VHF and UHF Television Construction Permits, 
Satellite Television Stations, Low Power Television (LPTV) Stations, 
and LPTV Translators/Boosters. Fee assessments were not issued for 
broadcast auxiliary stations, nor will they be issued for them in FY 
2005.
    \42\ The Commission-authorized Web site will be available on-
line throughout this summer. The site's Web address is http://www.fccfees.com.
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    35. We emphasize that parties must still submit a completed Form 
159 with their fee payment, despite having received an assessment 
postcard. The postcards are not to be used as a substitute for 
completing a Form 159. We cannot guarantee that a party's regulatory 
fees will be posted accurately against its account if a completed Form 
159 is not returned with the fee payment. We also emphasize that the 
facility ID is the most important data element that parties need to 
include on their completed Form 159. The facility ID is a unique 
identifier that never changes over the course of a facility's existence 
(unlike its call sign). We prominently display each facility's facility 
ID on its assessment postcard, and our Form 159 filing instructions 
require that each facility's facility ID (and call sign) needs to be 
provided. However, each year we typically receive many incomplete Form 
159s that do not provide the facility ID of the facility whose fee is 
being paid.
d. Cable Television Subscribers
    36. We adopt our proposal to generate fee assessment letters for 
cable operators who are on file as having paid FY 2004 regulatory fees 
for their basic cable subscribers.\43\ We received no comments or reply 
comments on this issue. Under our proposal, our assessment letter to 
each operator would announce the due date for payment of FY 2005 
regulatory fees; reflect the subscriber count for which the operator 
paid FY 2004 regulatory fees; and request that the operator access a 
Commission-authorized Web site to provide its aggregate count of basic 
cable subscribers as of December 31, 2004--the date that cable 
operators are to use as the basis for determining their regulatory fee 
obligations for basic cable subscribers. If the number of subscribers 
as of December 31, 2004 differs from the number paid for FY 2004, 
operators would be required to provide a brief explanation for the 
differing subscriber counts and indicate when the difference occurred. 
Cable operators who do not have access to the Internet would be able to 
contact the FCC CORES Help Desk at (877) 480-3201, Option 4, to provide 
their subscriber count as of

[[Page 41973]]

December 31, 2004. Payment procedures for FY 2005 regulatory fees are 
the same as they were in previous years. For example, cable operators 
are to complete the FCC Form 159 Remittance Advice when making their 
payment, and are to certify their December 31, 2004 subscriber count in 
Block 30 of the Form 159.
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    \43\ FY 2005 NPRM, 70 FR at 9583, para. 57.
---------------------------------------------------------------------------

    37. We also sought comment on a proposal to require the cable 
television operators to annually report their basic subscriber counts 
to the Commission prior to paying regulatory fees for the fiscal year 
in question.\44\ The Commission proposed to use the reported subscriber 
counts to audit regulatory fee payments that are collected later in the 
fiscal year. NCTA was the only commenter on this proposal. NCTA agreed 
that a June 1st reporting requirement could be met with accurate 
subscriber information from the previous year and would not be unduly 
burdensome for operators to file.\45\ We do not adopt a subscriber 
reporting requirement at this time. We will continue to assess our need 
for information to manage the regulatory fee assessment program and may 
revisit this issue in the future.
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    \44\ Id., paras. 60-61.
    \45\ NCTA Comments at 2.
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B. FY 2005 Fee Determination and FY 2004 Reconsideration

12. Commercial Mobile Radio Service (CMRS) Providers
    38. In this section, we address the arguments presented by Cingular 
and CTIA in their comments to the FY 2005 NPRM. In addition, we address 
Cingular's petition for reconsideration of the Commission's FY 2004 
Report and Order and the comments filed in response to Cingular's 
petition.\46\
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    \46\ See Cingular Wireless LLC Petition for Reconsideration, MD 
Docket No. 04-73, filed Aug. 6, 2004 (Cingular Petition). We 
received comments in support of the Cingular Petition from CTIA--The 
Wireless AssociationTM (CTIA) and joint comments from 
seven wireless carriers (American Cellular Corporation, AT&T 
Wireless Services, Inc., Dobson Cellular Systems, Inc., Nextel 
Communications, Inc., Sprint Corporation, T-Mobile USA, Inc., and 
Western Wireless Corporation) (Wireless Carriers). We also received 
reply comments in support of the petition from the Rural 
Telecommunications Group, Inc. (RTG).
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    39. Prior to FY 2004, the Commission relied on Cellular, PCS, and 
SMR providers to compute and submit the regulatory fee applicable to 
them based on the number of their subscribers. Beginning in fiscal year 
2004, the Commission decided to take an alternative approach and 
adopted a system of mailing assessments to Cellular, PCS, and SMR 
providers based on subscriber data contained in their Numbering 
Resource Utilization Forecast (NRUF) reports.\47\ NRUF data is 
collected by the North American Numbering Plan Administrator (NANPA) to 
monitor the utilization of telephone numbers by carriers. For purposes 
of assessing regulatory fees, the Commission uses the count of 
``assigned'' telephone numbers (TN's) \48\ stated by carriers in their 
NRUF reports (adjusted for porting).\49\ For carriers not required to 
file NRUF reports, the self-computation method still applies.\50\
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    \47\ FY 2004 Report and Order, 19 FCC Rcd at 11,675-76 para. 45.
    \48\ ``Assigned'' numbers are ``numbers working in the Public 
Switched Telephone Network under an agreement such as a contract or 
tariff at the request of specific end users or customers for their 
use, or numbers not yet working but having a customer service order 
pending.'' Instructions for Utilization and Forecast Forms, FCC Form 
502 (Jun. 2003).
    \49\ The porting information is developed from the telephone 
number porting database managed by the Local Number Portability 
Administrator, NeuStar, Inc.
    \50\ FY 2004 Report and Order, 19 FCC Rcd at 11,677 para. 49.
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    40. We disagree with the arguments of Cingular, CTIA, and others 
that the NRUF data are not sufficiently accurate for the purpose of 
assessing regulatory fees for the three classes of Commercial Mobile 
Radio Service (CMRS) providers--the Cellular Radiotelephone Service, 
the Personal Communications Service (PCS), and the Specialized Mobile 
Radio (SMR) Service. Evidence of the accuracy and reliability of the 
NRUF data can be found in the fact that while the initial FY 2004 
assessment letters calculated regulatory fees based on approximately 
162.36 million numbers, the reconciliation process, based on provider 
responses, revised the regulatory fee assessment by only 1.4 percent 
(to 160.02 million numbers). Further evidence of the reliability of the 
NRUF data is that in FY 2004, we issued 127 initial assessment letters 
to CMRS providers. Only 3.2 percent of the respondents had adjustments 
of greater than 5,000 subscribers but less than 20,000; and only 5.5 
percent had adjustments of greater than 20,000 subscribers. This 
experience indicates that NRUF data is sufficiently reliable and 
accurate for the purposes of assessing section 9 regulatory fees. We 
therefore reject Cingular's request to reconsider the use of NRUF data 
in calculating FY 2004 fees for these three classes of CMRS carriers. 
We will also continue to rely on the NRUF data for the FY 2005 
regulatory fee assessments for these carriers.
    41. Further, we find no basis for the assertion in Cingular's 
petition that a lack of clarity in the NRUF definition of 
``intermediate'' TN's (number made available for use by another 
telecommunications carrier or non-carrier entity) unduly complicates 
the correction process and makes the NRUF data unreliable.\51\ The 
Commission's fee assessment is based only on the number of ``assigned'' 
TN's stated in the NRUF report. Thus, to the extent that a carrier 
categorizes TN's as ``intermediate,'' it has no need to make a 
correction.
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    \51\ Cingular Petition at 4-5.
---------------------------------------------------------------------------

    42. These facts suggest that using NRUF data has not led to 
inaccurate or unfair assessments for CMRS providers. They also 
demonstrate that the Commission has a method to address and correct for 
potential anomalies that the NRUF data may implicate. We therefore 
disagree with Cingular and others that using NRUF data, combined with 
the reconciliation process, may result in overpayment of regulatory 
fees.\52\ In fact, using NRUF data, which is subject to verification, 
will likely produce more accurate assessments than the self-assessment 
method the Commission previously used. Our experience in FY 2004 
indicates that--far from being overly burdensome--this process offers 
CMRS providers an opportunity to correct potential errors in their data 
for section 9 regulatory fee assessment purposes.\53\
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    \52\ Cingular Petition at 3, 5-6.
    \53\ Cingular Petition at 5-6. See also CTIA Comments at 3.
---------------------------------------------------------------------------

    43. We also reject the arguments of Cingular and others that the 
two-step process that we established in the FY 2004 Report and Order--
sending an initial assessment letter, which a CMRS provider may 
correct, followed by a final assessment letter--is unduly 
burdensome.\54\ Cingular maintains that the correction process 
contemplates a burdensome number-by-number reconciliation of the NRUF 
data and a carrier's actual subscriber count. We clarify that carriers 
are not required to perform number-by-number reconciliations when 
making corrections. Carriers may make corrections on an aggregate 
basis. We will review the letters, and decide whether to accept the 
revised totals. Based upon this feedback, we will send out a second 
assessment letter that will coincide with the payment period of 
regulatory fees. This second assessment letter with aggregate totals 
will constitute the basis upon which FY 2005 regulatory fees will be 
paid. If we receive no response to our initial assessment letter within 
21 days, we will assume that no corrections are required and the final 
assessment letter, which is mailed approximately 30 days

[[Page 41974]]

after the initial letter, will base the fee payment due on the number 
of subscribers listed on the initial assessment. In response to 
Cingular's questions as to whether the Commission intends to allow 
carriers to correct so-called ``contaminated numbers'' (numbers used by 
a thousands-block carrier before donating the remainder of the block to 
the pool),\55\ we clarify that carriers are permitted to address 
``contaminated numbers.'' Paragraph 46 of the FY 2004 Report and Order 
specifically links the correction process with the problem of 
``contaminated numbers.'' To the extent that paragraph 46 of the FY 
2004 Report and Order does not unequivocally provide that carriers may 
correct the initial assessment letter to account for ``contaminated 
numbers,'' we hereby clarify that they may do so.
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    \54\ Cingular Petition at 5-6.
    \55\ Cingular Petition at 3.
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    44. We will continue to use the two-step process for assessing 
section 9 regulatory fees on CMRS providers as proposed in the FY 2005 
NPRM.\56\ Specifically, we will continue to mail an initial regulatory 
fee assessment to CMRS providers based on information they submit on 
their NRUF forms. The initial assessment letter will include a list of 
the carriers' Operating Company Numbers (OCNs), and an aggregate total 
of assigned numbers (adjusted for porting) upon which the assessment is 
based.\57\ If the number of subscribers on the initial assessment 
letter differs from the data included on their NRUF forms, CMRS 
providers may amend their initial assessment letter to identify their 
subscriber count as of December 31, 2004.
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    \56\ See FY 2005 NPRM, 70 FR at 9579, para. 51-52.
    \57\ Additionally, paragraph 48 of the FY 2004 Report and Order 
indicates that ``[i]f some subscribers are no longer customers, but 
have been assigned to another company, please indicate the company 
which has acquired these subscribers.'' Cingular suggests that it is 
unnecessary to report numbers because the Commission already takes 
ported numbers into account using the LNP database. Cingular 
Petition at 3. We agree with Cingular that it is generally 
unnecessary to correct ported numbers.
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III. Procedural Matters

A. Payment of Regulatory Fees

1. De Minimis Fee Payment Liability
    45. As in the past, regulatees whose total FY 2005 regulatory fee 
liability, including all categories of fees for which payment is due, 
amounts to less than $10 will be exempted from payment of FY 2005 
regulatory fees.
2. Standard Fee Calculations and Payment Dates for Annual Regulatory 
Fees
    46. The responsibility for payment of annual regulatory fees by 
service category is as follows: \58\
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    \58\ Note that regulatees in the service categories that are 
shaded in grey in Attachment D do not pay annual regulatory fees. We 
collect regulatory fees from these entities in advance to cover the 
term of license. Fee payments from these entities are submitted 
along with their initial authorization or renewal application when 
that application is filed.
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    (a) Media Services: The responsibility for the payment of 
regulatory fees rests with the holder of the permit or license as of 
October 1, 2004. However, in instances where a license or permit is 
transferred or assigned after October 1, 2004, responsibility for 
payment rests with the holder of the license or permit at the time 
payment is due.
    (b) Wireline (Common Carrier) Services: Fees must be paid for any 
authorization issued on or before October 1, 2004. However, where a 
license or permit is transferred or assigned after October 1, 2004, 
responsibility for payment rests with the holder of the license or 
permit at the time payment is due.
    (c) Wireless Services: Commercial Mobile Radio Service (CMRS) 
cellular, mobile, and messaging services (fees based upon a subscriber, 
unit or circuit count): Fees must be paid for any authorization issued 
on or before October 1, 2004. The number of subscribers, units or 
circuits on December 31, 2004 will be used as the basis from which to 
calculate the fee payment.
    (d) Multichannel Video Programming Distributor Services (basic 
cable television subscribers and CARS licenses): The number of 
subscribers on December 31, 2004 will be used as the basis from which 
to calculate the fee payment.\59\ For CARS licensees, fees must be paid 
for any authorization issued on or before October 1, 2004. The 
responsibility for the payment of regulatory fees for CARS licenses 
rests with the holder of the permit or license on October 1, 2004. 
However, in instances where a CARS license or permit is transferred or 
assigned after October 1, 2004, responsibility for payment rests with 
the holder of the license or permit at the time payment is due.
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    \59\ Cable television system operators should compute their 
basic subscribers as follows: Number of single family dwellings + 
number of individual households in multiple dwelling unit 
(apartments, condominiums, mobile home parks, etc.) paying at the 
basic subscriber rate + bulk rate customers + courtesy and free 
service customers. Note: Bulk-Rate Customers = Total annual bulk-
rate charge divided by basic annual subscription rate for individual 
households. Operators may base their count on ``a typical day in the 
last full week'' of December 2004, rather than on a count as of 
December 31, 2004.
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    (e) International Services: For earth stations and geostationary 
orbit space stations, payment is calculated on a per operational 
station basis. For non-geostationary orbit satellite systems, payment 
is calculated on a per operational system basis. The responsibility for 
the payment of regulatory fees rests with the holder of the permit or 
license on October 1, 2004. However, in instances where a license or 
permit is transferred or assigned after October 1, 2004, responsibility 
for payment rests with the holder of the license or permit at the time 
payment is due. For international bearer circuits, payment is 
calculated on a per active circuit basis as of December 31, 2004.
    47. We strongly recommend that entities who will be submitting more 
than twenty-five (25) Form 159-C's use the electronic Fee Filer program 
when sending their regulatory fee payment. We will, for the convenience 
of payers, accept fee payments made in advance of the normal formal 
window for the payment of regulatory fees.
3. Limitations on Credit Card Transactions
    48. The U.S. Treasury has advised the Commission that it may begin 
rejecting Credit Card transactions greater than $99,999.99 from a 
single credit card in a single day. The U.S. Treasury has published 
Bulletin No. 2005-03 in which Federal Agencies are directed to limit 
credit card collections per these rules. The Commission will institute 
policies to conform to the U.S. Treasury policy. Entities needing to 
remit amounts of $100,000.00 or greater should use check, ACH or Fed 
Wire payment methods. Additional information can be found at http://www.fcc.gov/fees.

B. Enforcement

    49. As a reminder to all licensees, section 159(c) of the 
Communications Act requires us to impose an additional charge as a 
penalty for late payment of any regulatory fee. As in years past, 
Failure to pay regulatory fees and/or any late payment penalty will 
subject regulatees to sanctions, including the provisions set forth in 
the Debt Collection Improvement Act of 1996 (``DCIA''). We also assess 
administrative processing charges on delinquent debts to recover 
additional costs incurred in processing and handling the related debt 
pursuant to the DCIA and section 1.1940(d) of the Commission's rules. 
These administrative processing charges

[[Page 41975]]

will be assessed on any delinquent regulatory fee, in addition to the 
25 percent late charge penalty. Partial underpayments of regulatory 
fees are treated in the following manner. The licensee will be given 
credit for the amount paid, but if it is later determined that the fee 
paid is incorrect or was submitted after the deadline date, the 25 
percent late charge penalty will be assessed on the portion that is 
submitted after the filing window.
    50. Furthermore, we amended our regulatory fee rules effective 
November 1, 2004, to provide that we will withhold action on any 
applications or other requests for benefits filed by anyone who is 
delinquent in any non-tax debts owed to the Commission (including 
regulatory fees) and will ultimately dismiss those applications or 
other requests if payment of the delinquent debt or other satisfactory 
arrangement for payment is not made. See 47 CFR 1.1161(c), 
1.1164(f)(5), and 1.1910. Failure to pay regulatory fees can also 
result in the initiation of a proceeding to revoke any and all 
authorizations held by the delinquent payer.

C. Congressional Review Act Analysis

    51. The Commission will send a copy of this Order in MD Docket No. 
05-59 and Order on Reconsideration in MD Docket No. 04-73 in a report 
to be sent to Congress and the General Accounting Office pursuant to 
the Congressional Review Act, see 5 U.S.C. 801(a)(1)(A).

IV. Ordering Clauses

    52. Accordingly, it is ordered pursuant to sections 4(i) and (j), 
9, and 303(r) of the Communications Act of 1934, as amended, 47 U.S.C. 
154(i), 154(j), 159, and 303(r) that the FY 2005 9 regulatory fee 
assessment requirements are adopted as specified herein.
    53. It is further ordered, pursuant to sections 4(i) and (j), 9, 
303(r), and 405 of the Communications Act of 1934, 47 U.S.C. 154(i), 
154(j), 159, 303(r), and 405, 47 U.S.C. 405 and 47 CFR 1.106 that the 
Petition for Reconsideration, filed August 6, 2004, by Cingular 
Wireless LLC is denied.
    54. It is further ordered that part 1 of the Commission's rules are 
amended as set forth in Attachment G, and that these rules shall become 
effective August 22, 2005.
    55. It is further ordered that the Commission's Consumer and 
Governmental Affairs Bureau, Reference Information Center, shall send a 
copy of this Order in MD Docket No. 05-59 and Order on Reconsideration 
in MD Docket No. 04-73, including the Final Regulatory Flexibility 
Analysis, to the Chief Counsel for Advocacy of the U.S. Small Business 
Administration.
    56. It is further ordered that this proceeding is terminated.

Federal Communications Commission.
Marlene H. Dortch,
Secretary.

Attachment A--Final Regulatory Flexibility Analysis

    57. As required by the Regulatory Flexibility Act (RFA),\60\ the 
Commission prepared an Initial Regulatory Flexibility Analysis (IRFA) 
of the possible significant economic impact on small entities by the 
policies and rules in its Notice of Proposed Rulemaking, In the Matter 
of Assessment and Collection of Regulatory Fees for Fiscal Year 2005. 
Written public comments were sought on the FY 2005 fees proposal, 
including comments on the IRFA. This present Final Regulatory 
Flexibility Analysis (FRFA) conforms to the RFA.\61\
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    \60\ 5 U.S.C. 603. The RFA, 5 U.S.C. 601-612 has been amended by 
the Contract With America Advancement Act of 1996, Public Law 104-
121, 110 Stat. 847 (1996) (CWAAA). Title II of the CWAAA is the 
Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA).
    \61\ 5 U.S.C. 604
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I. Need for, and Objectives of, the Proposed Rules

    58. This rulemaking proceeding is initiated to amend the Schedule 
of Regulatory Fees in the amount of $280,098,000, the amount that 
Congress has required the Commission to recover. The Commission seeks 
to collect the necessary amount through its revised Schedule of 
Regulatory Fees in the most efficient manner possible and without undue 
public burden.

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

    59. None.

III. Description and Estimate of the Number of Small Entities to Which 
the Proposed Rules Will Apply

    60. The RFA directs agencies to provide a description of, and where 
feasible, an estimate of the number of small entities that may be 
affected by the proposed rules and policies, if adopted.\62\ The RFA 
generally defines the term ``small entity'' as having the same meaning 
as the terms ``small business,'' ``small organization,'' and ``small 
governmental jurisdiction.'' \63\ In addition, the term ``small 
business'' has the same meaning as the term ``small business concern'' 
under the Small Business Act.\64\ 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 SBA.\65\
---------------------------------------------------------------------------

    \62\ 5 U.S.C. 603(b)(3).
    \63\ 5 U.S.C. 601(6).
    \64\ 5 U.S.C. 601(3) (incorporating by reference the definition 
of ``small-business concern'' in the Small Business Act, 15 U.S.C. 
632). Pursuant to 5 U.S.C. 601(3), the statutory definition of a 
small business applies ``unless an agency, after consultation with 
the Office of Advocacy of the Small Business Administration and 
after opportunity for public comment, establishes one or more 
definitions of such term which are appropriate to the activities of 
the agency and publishes such definition(s) in the Federal 
Register.''
    \65\ 15 U.S.C. 632.
---------------------------------------------------------------------------

    61. Small Businesses. Nationwide, there are a total of 22.4 million 
small businesses, according to SBA data.\66\
---------------------------------------------------------------------------

    \66\ See SBA, Programs and Services, SBA Pamphlet No. CO-0028, 
at page 40 (July 2002).
---------------------------------------------------------------------------

    62. Small Organizations. Nationwide, there are approximately 1.6 
million small organizations.\67\
---------------------------------------------------------------------------

    \67\ Independent Sector, The New Nonprofit Almanac & Desk 
Reference (2002).
---------------------------------------------------------------------------

    63. Small Governmental Jurisdictions. The term ``small governmental 
jurisdiction'' is defined as ``governments of cities, towns, townships, 
villages, school districts, or special districts, with a population of 
less than fifty thousand.'' \68\ As of 1997, there were approximately 
87,453 governmental jurisdictions in the United States.\69\ This number 
includes 39,044 county governments, municipalities, and townships, of 
which 37,546 (approximately 96.2%) have populations of fewer than 
50,000, and of which 1,498 have populations of 50,000 or more. Thus, we 
estimate the number of small governmental jurisdictions overall to be 
84,098 or fewer.
---------------------------------------------------------------------------

    \68\ 5 U.S.C. 601(5).
    \69\ U.S. Census Bureau, Statistical Abstract of the United 
States: 2000, Section 9, pages 299-300, Tables 490 and 492.
---------------------------------------------------------------------------

    64. We have included small incumbent local exchange carriers in 
this present RFA analysis. As noted above, a ``small business'' under 
the RFA is one that, inter alia, meets the pertinent small business 
size standard (e.g., a telephone communications business having 1,500 
or fewer employees), and ``is not dominant in its field of operation.'' 
\70\ The SBA's Office of Advocacy contends that, for RFA purposes, 
small incumbent local exchange carriers are not dominant in their field 
of operation because any such dominance is not ``national'' in 
scope.\71\

[[Page 41976]]

We have therefore included small incumbent local exchange carriers in 
this RFA analysis, although we emphasize that this RFA action has no 
effect on Commission analyses and determinations in other, non-RFA 
contexts.
---------------------------------------------------------------------------

    \70\ 15 U.S.C. 632.
    \71\ Letter from Jere W. Glover, Chief Counsel for Advocacy, 
SBA, to William E. Kennard, Chairman, FCC (May 27, 1999). The Small 
Business Act contains a definition of ``small-business concern,'' 
which the RFA incorporates into its own definition of ``small 
business.'' See 15 U.S.C. 632(a) (Small Business Act); 5 U.S.C. 
601(3) (RFA). SBA regulations interpret ``small business concern'' 
to include the concept of dominance on a national basis. See 13 CFR 
121.102(b).
---------------------------------------------------------------------------

    65. Incumbent Local Exchange Carriers (LECs). Neither the 
Commission nor the SBA has developed a small business size standard 
specifically for incumbent local exchange services. The appropriate 
size standard under SBA rules is for the category Wired 
Telecommunications Carriers. Under that size standard, such a business 
is small if it has 1,500 or fewer employees.\72\ According to 
Commission data,\73\ 1,337 carriers have reported that they are engaged 
in the provision of incumbent local exchange services. Of these 1,337 
carriers, an estimated 1,032 have 1,500 or fewer employees and 305 have 
more than 1,500 employees. Consequently, the Commission estimates that 
most providers of incumbent local exchange service are small businesses 
that may be affected by these rules.
---------------------------------------------------------------------------

    \72\ 13 CFR 121.201, North American Industry Classification 
System (NAICS) code 517110 (changed from 13310 in October 2002).
    \73\ FCC, Wireline Competition Bureau, Industry Analysis and 
Technology Division, ``Trends in Telephone Service'' at Table 5.3, 
Page 5-5 (Aug. 2003) (hereinafter ``Trends in Telephone Service''). 
This source uses data that are current as of December 31, 2001.
---------------------------------------------------------------------------

    66. Competitive Local Exchange Carriers (CLECs), Competitive Access 
Providers (CAPs), ``Shared-Tenant Service Providers,'' and ``Other 
Local Service Providers.'' Neither the Commission nor the SBA has 
developed a small business size standard specifically for these service 
providers. The appropriate size standard under SBA rules is for the 
category Wired Telecommunications Carriers. Under that size standard, 
such a business is small if it has 1,500 or fewer employees.\74\ 
According to Commission data,\75\ 609 carriers have reported that they 
are engaged in the provision of either competitive access provider 
services or competitive local exchange carrier services. Of these 609 
carriers, an estimated 458 have 1,500 or fewer employees and 151 have 
more than 1,500 employees. In addition, 16 carriers have reported that 
they are ``Shared-Tenant Service Providers,'' and all 16 are estimated 
to have 1,500 or fewer employees. In addition, 35 carriers have 
reported that they are ``Other Local Service Providers.'' Of the 35, an 
estimated 34 have 1,500 or fewer employees and one has more than 1,500 
employees. Consequently, the Commission estimates that most providers 
of competitive local exchange service, competitive access providers, 
``Shared-Tenant Service Providers,'' and ``Other Local Service 
Providers'' are small entities that may be affected by these rules.
---------------------------------------------------------------------------

    \74\ 13 CFR 121.201, NAICS code 517110 (changed from 513310 in 
October 2002).
    \75\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    67. Local Resellers. The SBA has developed a small business size 
standard for the category of Telecommunications Resellers. Under that 
size standard, such a business is small if it has 1,500 or fewer 
employees.\76\ According to Commission data,\77\ 133 carriers have 
reported that they are engaged in the provision of local resale 
services. Of these, an estimated 127 have 1,500 or fewer employees and 
six have more than 1,500 employees. Consequently, the Commission 
estimates that the majority of local resellers are small entities that 
may be affected by these rules.
---------------------------------------------------------------------------

    \76\ 13 CFR 121.201, NAICS code 517310 (changed from 513330 in 
October 2002).
    \77\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    68. Toll Resellers. The SBA has developed a small business size 
standard for the category of Telecommunications Resellers. Under that 
size standard, such a business is small if it has 1,500 or fewer 
employees.\78\ According to Commission data,\79\ 625 carriers have 
reported that they are engaged in the provision of toll resale 
services. Of these, an estimated 590 have 1,500 or fewer employees and 
35 have more than 1,500 employees. Consequently, the Commission 
estimates that the majority of toll resellers are small entities that 
may be affected by these rules.
---------------------------------------------------------------------------

    \78\ 13 CFR 121.201, NAICS code 517310 (changed to 513330 in 
October 2002).
    \79\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    69. Payphone Service Providers (PSPs). Neither the Commission nor 
the SBA has developed a small business size standard specifically for 
payphone services providers. The appropriate size standard under SBA 
rules is for the category Wired Telecommunications Carriers. Under that 
size standard, such a business is small if it has 1,500 or fewer 
employees.\80\ According to Commission data,\81\ 761 carriers have 
reported that they are engaged in the provision of payphone services. 
Of these, an estimated 757 have 1,500 or fewer employees and four have 
more than 1,500 employees. Consequently, the Commission estimates that 
the majority of payphone service providers are small entities that may 
be affected by these rules.
---------------------------------------------------------------------------

    \80\ 13 CFR 121.201, NAICS code 517110 (changed from 513310 in 
October 2002).
    \81\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    70. Interexchange Carriers (IXCs). Neither the Commission nor the 
SBA has developed a small business size standard specifically for 
providers of interexchange services. The appropriate size standard 
under SBA rules is for the category Wired Telecommunications Carriers. 
Under that size standard, such a business is small if it has 1,500 or 
fewer employees.\82\ According to Commission data,\83\ 261 carriers 
have reported that they are engaged in the provision of interexchange 
service. Of these, an estimated 223 have 1,500 or fewer employees and 
38 have more than 1,500 employees. Consequently, the Commission 
estimates that the majority of IXCs are small entities that may be 
affected by these rules.
---------------------------------------------------------------------------

    \82\ 13 CFR 121.201, NAICS code 517110 (changed from 513310 in 
October 2002).
    \83\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    71. Operator Service Providers (OSPs). Neither the Commission nor 
the SBA has developed a small business size standard specifically for 
operator service providers. The appropriate size standard under SBA 
rules is for the category Wired Telecommunications Carriers. Under that 
size standard, such a business is small if it has 1,500 or fewer 
employees.\84\ According to Commission data,\85\ 23 carriers have 
reported that they are engaged in the provision of operator services. 
Of these, an estimated 22 have 1,500 or fewer employees and one has 
more than 1,500 employees. Consequently, the Commission estimates that 
the majority of OSPs are small entities that may be affected by these 
rules.
---------------------------------------------------------------------------

    \84\ 13 CFR 121.201, NAICS code 517110 (changed from 513310 in 
October 2002).
    \85\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    72. Prepaid Calling Card Providers. Neither the Commission nor the 
SBA has developed a small business size standard specifically for 
prepaid calling card providers. The appropriate size standard under SBA 
rules is for the category Telecommunications Resellers. Under that size 
standard, such a business is small if it has 1,500 or fewer 
employees.\86\ According to Commission data,\87\ 37 carriers have 
reported that they are engaged in the provision of prepaid calling 
cards. Of these, an estimated 36 have 1,500 or fewer employees and one 
has more than 1,500 employees. Consequently, the Commission estimates 
that the majority

[[Page 41977]]

of prepaid calling card providers are small entities that may be 
affected by these rules.
---------------------------------------------------------------------------

    \86\ 13 CFR 121.201, NAICS code 517310 (changed from 513330 in 
October 2002).
    \87\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    73. 800 and 800-Like Service Subscribers.\88\ Neither the 
Commission nor the SBA has developed a small business size standard 
specifically for 800 and 800-like service (``toll free'') subscribers. 
The appropriate size standard under SBA rules is for the category 
Telecommunications Resellers. Under that size standard, such a business 
is small if it has 1,500 or fewer employees.\89\ The most reliable 
source of information regarding the number of these service subscribers 
appears to be data the Commission collects on the 800, 888, and 877 
numbers in use.\90\ According to our data, at the end of January, 1999, 
the number of 800 numbers assigned was 7,692,955; the number of 888 
numbers assigned was 7,706,393; and the number of 877 numbers assigned 
was 1,946,538. We do not have data specifying the number of these 
subscribers that are not independently owned and operated or have more 
than 1,500 employees, and thus are unable at this time to estimate with 
greater precision the number of toll free subscribers that would 
qualify as small businesses under the SBA size standard. Consequently, 
we estimate that there are 7,692,955 or fewer small entity 800 
subscribers; 7,706,393 or fewer small entity 888 subscribers; and 
1,946,538 or fewer small entity 877 subscribers.
---------------------------------------------------------------------------

    \88\ We include all toll-free number subscribers in this 
category, including those for 888 numbers.
    \89\ 13 CFR 121.201, NAICS code 517310 (changed from 513330 in 
October 2002).
    \90\ FCC, Common Carrier Bureau, Industry Analysis Division, 
Study on Telephone Trends, Tables 21.2, 21.3, and 21.4 (Feb. 19, 
1999).
---------------------------------------------------------------------------

    74. International Service Providers. The Commission has not 
developed a small business size standard specifically for providers of 
international service. The appropriate size standards under SBA rules 
are for the two broad categories of Satellite Telecommunications and 
Other Telecommunications. Under both categories, such a business is 
small if it has $12.5 million or less in average annual receipts.\91\ 
For the first category of Satellite Telecommunications, Census Bureau 
data for 1997 show that there were a total of 324 firms that operated 
for the entire year.\92\ Of this total, 273 firms had annual receipts 
of under $10 million, and an additional 24 firms had receipts of $10 
million to $24,999,999. Thus, the majority of Satellite 
Telecommunications firms can be considered small.
---------------------------------------------------------------------------

    \91\ 13 CFR 121.201, NAICS codes 517410 and 517910 (changed from 
513340 and 513390 in October 2002).
    \92\ U.S. Census Bureau, 1997 Economic Census, Subject Series: 
Information, ``Establishment and Firm Size (Including Legal Form of 
Organization),'' Table 4, NAICS code 513340 (issued October 2000).
---------------------------------------------------------------------------

    75. The second category--Other Telecommunications--includes 
``establishments primarily engaged in * * * providing satellite 
terminal stations and associated facilities operationally connected 
with one or more terrestrial communications systems and capable of 
transmitting telecommunications to or receiving telecommunications from 
satellite systems.'' \93\ According to Census Bureau data for 1997, 
there were 439 firms in this category that operated for the entire 
year.\94\ Of this total, 424 firms had annual receipts of $5 million to 
$9,999,999 and an additional six firms had annual receipts of $10 
million to $24,999,990. Thus, under this second size standard, the 
majority of firms can be considered small.
---------------------------------------------------------------------------

    \93\ Office of Management and Budget, North American Industry 
Classification System, page 513 (1997) (NAICS code 513390, changed 
to 517910 in October 2002).
    \94\ U.S. Census Bureau, 1997 Economic Census, Subject Series: 
Information, ``Establishment and Firm Size (Including Legal Form of 
Organization),'' Table 4, NAICS code 513390 (issued October 2000).
---------------------------------------------------------------------------

    76. Wireless Service Providers. The SBA has developed a small 
business size standard for wireless firms within the two broad economic 
census categories of ``Paging'' \95\ and ``Cellular and Other Wireless 
Telecommunications.'' \96\ Under both SBA categories, a wireless 
business is small if it has 1,500 or fewer employees. For the census 
category of Paging, Census Bureau data for 1997 show that there were 
1,320 firms in this category, total, that operated for the entire 
year.\97\ Of this total, 1,303 firms had employment of 999 or fewer 
employees, and an additional 17 firms had employment of 1,000 employees 
or more.\98\ Thus, under this category and associated small business 
size standard, the great majority of firms can be considered small. For 
the census category Cellular and Other Wireless Telecommunications, 
Census Bureau data for 1997 show that there were 977 firms in this 
category, total, that operated for the entire year.\99\ Of this total, 
965 firms had employment of 999 or fewer employees, and an additional 
12 firms had employment of 1,000 employees or more.\100\ Thus, under 
this second category and size standard, the great majority of firms 
can, again, be considered small.
---------------------------------------------------------------------------

    \95\ 13 CFR 121.201, NAICS code 513321 (changed to 517211 in 
October 2002).
    \96\ 13 CFR 121.201, NAICS code 513322 (changed to 517212 in 
October 2002).
    \97\ U.S. Census Bureau, 1997 Economic Census, Subject Series: 
``Information,'' Table 5, Employment Size of Firms Subject to 
Federal Income Tax: 1997, NAICS code 513321 (issued October 2000).
    \98\ U.S. Census Bureau, 1997 Economic Census, Subject Series: 
``Information,'' Table 5, Employment Size of Firms Subject to 
Federal Income Tax: 1997, NAICS code 513321 (issued October 2000). 
The census data do not provide a more precise estimate of the number 
of firms that have employment of 1,500 or fewer employees; the 
largest category provided is ``Firms with 1000 employees or more.''
    \99\ U.S. Census Bureau, 1997 Economic Census, Subject Series: 
``Information,'' Table 5, Employment Size of Firms Subject to 
Federal Income Tax: 1997, NAICS code 513322 (issued October 2000).
    \100\ U.S. Census Bureau, 1997 Economic Census, Subject Series: 
``Information,'' Table 5, Employment Size of Firms Subject to 
Federal Income Tax: 1997, NAICS code 513322 (issued October 2000). 
The census data do not provide a more precise estimate of the number 
of firms that have employment of 1,500 or fewer employees; the 
largest category provided is ``Firms with 1000 employees or more.''
---------------------------------------------------------------------------

    77. Internet Service Providers. The SBA has developed a small 
business size standard for Internet Service Providers. This category 
comprises establishments ``primarily engaged in providing direct access 
through telecommunications networks to computer-held information 
compiled or published by others.'' \101\ Under the SBA size standard, 
such a business is small if it has average annual receipts of $21 
million or less.\102\ According to Census Bureau data for 1997, there 
were 2,751 firms in this category that operated for the entire 
year.\103\ Of these, 2,659 firms had annual receipts of under $10 
million, and an additional 67 firms had receipts of between $10 million 
and $24,999,999.\104\ Thus, under this size standard, the great 
majority of firms can be considered small entities.
---------------------------------------------------------------------------

    \101\ Office of Management and Budget, North American Industry 
Classification System, page 515 (1997). NAICS code 514191, ``On-Line 
Information Services'' (changed to current name and to code 518111 
in October 2002).
    \102\ 13 CFR 121.201, NAICS code 518111.
    \103\ U.S. Census Bureau, 1997 Economic Census, Subject Series: 
``Information,'' Table 4, Receipts Size of Firms Subject to Federal 
Income Tax: 1997, NAICS code 514191 (issued October 2000).
    \104\ U.S. Census Bureau, 1997 Economic Census, Subject Series: 
``Information,'' Table 4, Receipts Size of Firms Subject to Federal 
Income Tax: 1997, NAICS code 514191 (issued October 2000).
---------------------------------------------------------------------------

    78. Cellular Licensees. The SBA has developed a small business size 
standard for wireless firms within the broad economic census category 
``Cellular and Other Wireless Telecommunications.'' \105\ Under this 
SBA category, a wireless business is small if it has 1,500 or fewer 
employees. For the census category Cellular and Other Wireless 
Telecommunications firms, Census Bureau data for 1997 show that there 
were 977 firms in this category, total, that operated for the

[[Page 41978]]

entire year.\106\ Of this total, 965 firms had employment of 999 or 
fewer employees, and an additional 12 firms had employment of 1,000 
employees or more.\107\ Thus, under this category and size standard, 
the great majority of firms can be considered small. According to the 
most recent Trends in Telephone Service data, 719 carriers reported 
that they were engaged in the provision of cellular service, personal 
communications service, or specialized mobile radio telephony services, 
which are placed together in the data.\108\ We have estimated that 294 
of these are small, under the SBA small business size standard.\109\
---------------------------------------------------------------------------

    \105\ 13 CFR 121.201, NAICS code 513322 (changed to 517212 in 
October 2002).
    \106\ U.S. Census Bureau, 1997 Economic Census, Subject Series: 
``Information,'' Table 5, Employment Size of Firms Subject to 
Federal Income Tax: 1997, NAICS code 513322 (issued October 2000).
    \107\ U.S. Census Bureau, 1997 Economic Census, Subject Series: 
``Information,'' Table 5, Employment Size of Firms Subject to 
Federal Income Tax: 1997, NAICS code 513322 (issued October 2000). 
The census data do not provide a more precise estimate of the number 
of firms that have employment of 1,500 or fewer employees; the 
largest category provided is ``Firms with 1000 employees or more.''
    \108\ FCC, Wireline Competition Bureau, Industry Analysis and 
Technology Division, ``Trends in Telephone Service'' at Table 5.3, 
page 5-5 (August 2003). This source uses data that are current as of 
December 31, 2001.
    \109\ FCC, Wireline Competition Bureau, Industry Analysis and 
Technology Division, ``Trends in Telephone Service'' at Table 5.3, 
page 5-5 (August 2003). This source uses data that are current as of 
December 31, 2001.
---------------------------------------------------------------------------

    79. Common Carrier Paging. The SBA has developed a small business 
size standard for wireless firms within the broad economic census 
categories of ``Cellular and Other Wireless Telecommunications.'' \110\ 
Under this SBA category, a wireless business is small if it has 1,500 
or fewer employees. For the census category of Paging, Census Bureau 
data for 1997 show that there were 1,320 firms in this category, total, 
that operated for the entire year.\111\ Of this total, 1,303 firms had 
employment of 999 or fewer employees, and an additional 17 firms had 
employment of 1,000 employees or more.\112\ Thus, under this category 
and associated small business size standard, the great majority of 
firms can be considered small.
---------------------------------------------------------------------------

    \110\ 13 CFR 121.201, NAICS code 513322 (changed to 517212 in 
October 2002).
    \111\ U.S. Census Bureau, 1997 Economic Census, Subject Series: 
``Information,'' Table 5, Employment Size of Firms Subject to 
Federal Income Tax: 1997, NAICS code 513321 (issued October 2000).
    \112\ U.S. Census Bureau, 1997 Economic Census, Subject Series: 
``Information,'' Table 5, Employment Size of Firms Subject to 
Federal Income Tax: 1997, NAICS code 513321 (issued October 2000). 
The census data do not provide a more precise estimate of the number 
of firms that have employment of 1,500 or fewer employees; the 
largest category provided is ``Firms with 1000 employees or more.''
---------------------------------------------------------------------------

    80. In the Paging Second Report and Order, the Commission adopted a 
size standard for ``small businesses'' for purposes of determining 
their eligibility for special provisions such as bidding credits and 
installment payments.\113\ A small business is an entity that, together 
with its affiliates and controlling principals, has average gross 
revenues not exceeding $15 million for the preceding three years.\114\ 
The SBA has approved this definition.\115\ An auction of Metropolitan 
Economic Area (MEA) licenses commenced on February 24, 2000, and closed 
on March 2, 2000. Of the 2,499 licenses auctioned, 985 were sold.\116\ 
Fifty-seven companies claiming small business status won 440 
licenses.\117\ An auction of MEA and Economic Area (EA) licenses 
commenced on October 30, 2001, and closed on December 5, 2001. Of the 
15,514 licenses auctioned, 5,323 were sold.\118\ One hundred thirty-two 
companies claiming small business status purchased 3,724 licenses. A 
third auction, consisting of 8,874 licenses in each of 175 EAs and 
1,328 licenses in all but three of the 51 MEAs commenced on May 13, 
2003, and closed on May 28, 2003. Seventy-seven bidders claiming small 
or very small business status won 2,093 licenses.\119\ Currently, there 
are approximately 74,000 Common Carrier Paging licenses. According to 
the most recent Trends in Telephone Service, 608 private and common 
carriers reported that they were engaged in the provision of either 
paging or ``other mobile'' services.\120\ Of these, we estimate that 
589 are small, under the SBA-approved small business size 
standard.\121\ We estimate that the majority of common carrier paging 
providers would qualify as small entities under the SBA definition.
---------------------------------------------------------------------------

    \113\ Revision of Part 22 and Part 90 of the Commission's Rules 
to Facilitate Future Development of Paging Systems, Second Report 
and Order, 12 FCC Rcd 2732, 2811-2812, paras. 178-181 (Paging Second 
Report and Order); see also Revision of Part 22 and Part 90 of the 
Commission's Rules to Facilitate Future Development of Paging 
Systems, Memorandum Opinion and Order on Reconsideration, 14 FCC Rcd 
10030, 10085-10088, paras. 98-107 (1999).
    \114\ Paging Second Report and Order, 12 FCC Rcd at 2811, para. 
179.
    \115\ See Letter to Amy Zoslov, Chief, Auctions and Industry 
Analysis Division, Wireless Telecommunications Bureau, from Aida 
Alvarez, Administrator, Small Business Administration, dated 
December 2, 1998.
    \116\ See ``929 and 931 MHz Paging Auction Closes,'' Public 
Notice, 15 FCC Rcd 4858 (WTB 2000).
    \117\ See ``929 and 931 MHz Paging Auction Closes,'' Public 
Notice, 15 FCC Rcd 4858 (WTB 2000).
    \118\ See ``Lower and Upper Paging Band Auction Closes,'' Public 
Notice, 16 FCC Rcd 21821 (WTB 2002).
    \119\ See ``Lower and Upper Paging Bands Auction Closes,'' 
Public Notice, 18 FCC Rcd 11154 (WTB 2003).
    \120\ See Trends in Telephone Service, Industry Analysis 
Division, Wireline Competition Bureau, Table 5.3 (Number of 
Telecommunications Service Providers that are Small Businesses) (May 
2002).
    \121\ 13 CFR 121.201, NAICS code 517211.
---------------------------------------------------------------------------

    81. Wireless Communications Services. This service can be used for 
fixed, mobile, radiolocation, and digital audio broadcasting satellite 
uses. The Commission defined ``small business'' for the wireless 
communications services (WCS) auction as an entity with average gross 
revenues of $40 million for each of the three preceding years, and a 
``very small business'' as an entity with average gross revenues of $15 
million for each of the three preceding years.\122\ The SBA has 
approved these definitions.\123\ The Commission auctioned geographic 
area licenses in the WCS service. In the auction, which commenced on 
April 15, 1997 and closed on April 25, 1997, there were seven bidders 
that won 31 licenses that qualified as very small business entities, 
and one bidder that won one license that qualified as a small business 
entity. An auction for one license in the 1670-1674 MHz band commenced 
on April 30, 2003 and closed the same day. One license was awarded. The 
winning bidder was not a small entity.
---------------------------------------------------------------------------

    \122\ Amendment of the Commission's Rules to Establish Part 27, 
the Wireless Communications Service (WCS), Report and Order, 12 FCC 
Rcd 10785, 10879, para. 194 (1997).
    \123\ See Letter to Amy Zoslov, Chief, Auctions and Industry 
Analysis Division, Wireless Telecommunications Bureau, Federal 
Communications Commission, from Aida Alvarez, Administrator, Small 
Business Administration, dated December 2, 1998.
---------------------------------------------------------------------------

    82. Wireless Telephony. Wireless telephony includes cellular, 
personal communications services, and specialized mobile radio 
telephony carriers. The SBA has developed a small business size 
standard for ``Cellular and Other Wireless Telecommunications'' 
services.\124\ Under the SBA small business size standard, a business 
is small if it has 1,500 or fewer employees.\125\ According to the most 
recent Trends in Telephone Service data, 719 carriers reported that 
they were engaged in wireless telephony.\126\ We have estimated that 
294 of these are small under the SBA small business size standard.
---------------------------------------------------------------------------

    \124\ 13 CFR 121.201, NAICS code 513322 (changed to 517212 in 
October 2002).
    \125\ 13 CFR 121.201, NAICS code 513322 (changed to 517212 in 
October 2002).
    \126\ FCC, Wireline Competition Bureau, Industry Analysis and 
Technology Division, ``Trends in Telephone Service'' at Table 5.3, 
page 5-5 (August 2003). This source uses data that are current as of 
December 31, 2001.
---------------------------------------------------------------------------

    83. Broadband Personal Communications Service. The

[[Page 41979]]

broadband personal communications services (PCS) spectrum is divided 
into six frequency blocks designated A through F, and the Commission 
has held auctions for each block. The Commission has created a small 
business size standard for Blocks C and F as an entity that has average 
gross revenues of less than $40 million in the three previous calendar 
years.\127\ For Block F, an additional small business size standard for 
``very small business'' was added and is defined as an entity that, 
together with its affiliates, has average gross revenues of not more 
than $15 million for the preceding three calendar years.\128\ These 
small business size standards, in the context of broadband PCS 
auctions, have been approved by the SBA.\129\ No small businesses 
within the SBA-approved small business size standards bid successfully 
for licenses in Blocks A and B. There were 90 winning bidders that 
qualified as small entities in the Block C auctions. A total of 93 
``small'' and ``very small'' business bidders won approximately 40 
percent of the 1,479 licenses for Blocks D, E, and F.\130\ On March 23, 
1999, the Commission reauctioned 155 C, D, E, and F Block licenses; 
there were 113 small business winning bidders.\131\
---------------------------------------------------------------------------

    \127\ See Amendment of Parts 20 and 24 of the Commission's 
Rules--Broadband PCS Competitive Bidding and the Commercial Mobile 
Radio Service Spectrum Cap, Report and Order, 11 FCC Rcd 7824, 7850-
7852, paras. 57-60 (1996); see also 47 CFR 24.720(b).
    \128\ See Amendment of Parts 20 and 24 of the Commission's 
Rules--Broadband PCS Competitive Bidding and the Commercial Mobile 
Radio Service Spectrum Cap, Report and Order, 11 FCC Rcd 7824, 7852, 
para. 60.
    \129\ See Letter to Amy Zoslov, Chief, Auctions and Industry 
Analysis Division, Wireless Telecommunications Bureau, Federal 
Communications Commission, from Aida Alvarez, Administrator, Small 
Business Administration, dated December 2, 1998.
    \130\ FCC News, ``Broadband PCS, D, E and F Block Auction 
Closes,'' No. 71744 (released January 14, 1997).
    \131\ See ``C, D, E, and F Block Broadband PCS Auction Closes,'' 
Public Notice, 14 FCC Rcd 6688 (WTB 1999).
---------------------------------------------------------------------------

    84. On January 26, 2001, the Commission completed the auction of 
422 C and F Broadband PCS licenses in Auction No. 35. Of the 35 winning 
bidders in this auction, 29 qualified as ``small'' or ``very small'' 
businesses.\132\ Subsequent events, concerning Auction 35, including 
judicial and agency determinations, resulted in a total of 163 C and F 
Block licenses being available for grant.
---------------------------------------------------------------------------

    \132\ See ``C and F Block Broadband PCS Auction Closes; Winning 
Bidders Announced,'' Public Notice, 16 FCC Rcd 2339 (2001).
---------------------------------------------------------------------------

    85. Narrowband Personal Communications Services. The Commission 
held an auction for Narrowband PCS licenses that commenced on July 25, 
1994, and closed on July 29, 1994. A second auction commenced on 
October 26, 1994 and closed on November 8, 1994. For purposes of the 
first two Narrowband PCS auctions, ``small businesses'' were entities 
with average gross revenues for the prior three calendar years of $40 
million or less.\133\ Through these auctions, the Commission awarded a 
total of 41 licenses, 11 of which were obtained by four small 
businesses.\134\ To ensure meaningful participation by small business 
entities in future auctions, the Commission adopted a two-tiered small 
business size standard in the Narrowband PCS Second Report and 
Order.\135\ A ``small business'' is an entity that, together with 
affiliates and controlling interests, has average gross revenues for 
the three preceding years of not more than $40 million.\136\ A ``very 
small business'' is an entity that, together with affiliates and 
controlling interests, has average gross revenues for the three 
preceding years of not more than $15 million.\137\ The SBA has approved 
these small business size standards.\138\ A third auction commenced on 
October 3, 2001 and closed on October 16, 2001. Here, five bidders won 
317 (Metropolitan Trading Areas and nationwide) licenses.\139\ Three of 
these claimed status as a small or very small entity and won 311 
licenses.
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    \133\ Implementation of Section 309(j) of the Communications 
Act--Competitive Bidding Narrowband PCS, Third Memorandum Opinion 
and Order and Further Notice of Proposed Rulemaking, 10 FCC Rcd 175, 
196, para. 46 (1994).
    \134\ See ``Announcing the High Bidders in the Auction of ten 
Nationwide Narrowband PCS Licenses, Winning Bids Total 
$617,006,674,'' Public Notice, PNWL 94-004 (released Aug. 2, 1994); 
``Announcing the High Bidders in the Auction of 30 Regional 
Narrowband PCS Licenses; Winning Bids Total $490,901,787,'' Public 
Notice, PNWL 94-27 (released Nov. 9, 1994).
    \135\ Amendment of the Commission's Rules to Establish New 
Personal Communications Services, Narrowband PCS, Second Report and 
Order and Second Further Notice of Proposed Rule Making, 15 FCC Rcd 
10456, 10476, para. 40 (2000).
    \136\ Amendment of the Commission's Rules to Establish New 
Personal Communications Services, Narrowband PCS, Second Report and 
Order and Second Further Notice of Proposed Rule Making, 15 FCC Rcd 
10456, 10476, para. 40 (2000).
    \137\ Amendment of the Commission's Rules to Establish New 
Personal Communications Services, Narrowband PCS, Second Report and 
Order and Second Further Notice of Proposed Rule Making, 15 FCC Rcd 
10456, 10476, para. 40 (2000).
    \138\ See Letter to Amy Zoslov, Chief, Auctions and Industry 
Analysis Division, Wireless Telecommunications Bureau, Federal 
Communications Commission, from Aida Alvarez, Administrator, Small 
Business Administration, dated December 2, 1998.
    \139\ See ``Narrowband PCS Auction Closes,'' Public Notice, 16 
FCC Rcd 18663 (WTB 2001).
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    86. Lower 700 MHz Band Licenses. We adopted criteria for defining 
three groups of small businesses for purposes of determining their 
eligibility for special provisions such as bidding credits.\140\ We 
have defined a ``small business'' as an entity that, together with its 
affiliates and controlling principals, has average gross revenues not 
exceeding $40 million for the preceding three years.\141\ A ``very 
small business'' is defined as an entity that, together with its 
affiliates and controlling principals, has average gross revenues that 
are not more than $15 million for the preceding three years.\142\ 
Additionally, the lower 700 MHz Service has a third category of small 
business status that may be claimed for Metropolitan/Rural Service Area 
(MSA/RSA) licenses. The third category is ``entrepreneur,'' which is 
defined as an entity that, together with its affiliates and controlling 
principals, has average gross revenues that are not more than $3 
million for the preceding three years.\143\ The SBA has approved these 
small size standards.\144\ An auction of 740 licenses (one license in 
each of the 734 MSAs/RSAs and one license in each of the six Economic 
Area Groupings (EAGs)) commenced on August 27, 2002, and closed on 
September 18, 2002. Of the 740 licenses available for auction, 484 
licenses were sold to 102 winning bidders. Seventy-two of the winning 
bidders claimed small business, very small business or entrepreneur 
status and won a total of 329 licenses.\145\ A second auction commenced 
on May 28, 2003, and closed on June 13, 2003, and included 256 
licenses: 5 EAG licenses and 476 Cellular Market Area licenses.\146\ 
Seventeen winning bidders

[[Page 41980]]

claimed small or very small business status and won 60 licenses, and 
nine winning bidders claimed entrepreneur status and won 154 
licenses.\147\
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    \140\ See Reallocation and Service Rules for the 698-746 MHz 
Spectrum Band (Television Channels 52-59), Report and Order, 17 FCC 
Rcd 1022 (2002).
    \141\ See Reallocation and Service Rules for the 698-746 MHz 
Spectrum Band (Television Channels 52-59), Report and Order, 17 FCC 
Rcd 1022, 1087-88, para. 172 (2002).
    \142\ See Reallocation and Service Rules for the 698-746 MHz 
Spectrum Band (Television Channels 52-59), Report and Order, 17 FCC 
Rcd 1022, 1087-88, para. 172 (2002).
    \143\ See Reallocation and Service Rules for the 698-746 MHz 
Spectrum Band (Television Channels 52-59), Report and Order, 17 FCC 
Rcd 1022, 1088, para. 173 (2002).
    \144\ See Letter to Thomas Sugrue, Chief, Wireless 
Telecommunications Bureau, Federal Communications Commission, from 
Aida Alvarez, Administrator, Small Business Administration, dated 
August 10, 1999.
    \145\ See ``Lower 700 MHz Band Auction Closes,'' Public Notice, 
17 FCC Rcd 17272 (WTB 2002).
    \146\ See ``Lower 700 MHz Band Auction Closes,'' Public Notice, 
18 FCC Rcd 11873 (WTB 2003).
    \147\ See ``Lower 700 MHz Band Auction Closes,'' Public Notice, 
18 FCC Rcd 11873 (WTB 2003).
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    87. Upper 700 MHz Band Licenses. The Commission released a Report 
and Order, authorizing service in the upper 700 MHz band.\148\ This 
auction, previously scheduled for January 13, 2003, has been 
postponed.\149\
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    \148\ Service Rules for the 746-764 and 776-794 MHz Bands, and 
Revisions to Part 27 of the Commission's Rules, Second Memorandum 
Opinion and Order, 16 FCC Rcd 1239 (2001).
    \149\ See ``Auction of Licenses for 747-762 and 777-792 MHz 
Bands (Auction No. 31) Is Rescheduled,'' Public Notice, 16 FCC Rcd 
13079 (WTB 2003).
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    88. 700 MHz Guard Band Licenses. In the 700 MHz Guard Band Order, 
we adopted size standards for ``small businesses'' and ``very small 
businesses'' for purposes of determining their eligibility for special 
provisions such as bidding credits and installment payments.\150\ A 
small business in this service is an entity that, together with its 
affiliates and controlling principals, has average gross revenues not 
exceeding $40 million for the preceding three years.\151\ Additionally, 
a very small business is an entity that, together with its affiliates 
and controlling principals, has average gross revenues that are not 
more than $15 million for the preceding three years.\152\ SBA approval 
of these definitions is not required.\153\ An auction of 52 Major 
Economic Area (MEA) licenses commenced on September 6, 2000, and closed 
on September 21, 2000.\154\ Of the 104 licenses auctioned, 96 licenses 
were sold to nine bidders. Five of these bidders were small businesses 
that won a total of 26 licenses. A second auction of 700 MHz Guard Band 
licenses commenced on February 13, 2001, and closed on February 21, 
2001. All eight of the licenses auctioned were sold to three bidders. 
One of these bidders was a small business that won a total of two 
licenses.\155\
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    \150\ See Service Rules for the 746-764 MHz Bands, and Revisions 
to Part 27 of the Commission's Rules, Second Report and Order, 15 
FCC Rcd 5299 (2000).
    \151\ See Service Rules for the 746-764 MHz Bands, and Revisions 
to Part 27 of the Commission's Rules, Second Report and Order, 15 
FCC Rcd 5299, 5343, para. 108 (2000).
    \152\ See Service Rules for the 746-764 MHz Bands, and Revisions 
to Part 27 of the Commission's Rules, Second Report and Order, 15 
FCC Rcd 5299, 5343, para. 108 (2000).
    \153\ See Service Rules for the 746-764 MHz Bands, and Revisions 
to Part 27 of the Commission's Rules, Second Report and Order, 15 
FCC Rcd 5299, 5343, para. 108 n.246 (for the 746-764 MHz and 776-794 
MHz bands, the Commission is exempt from 15 U.S.C. 632, which 
requires Federal agencies to obtain SBA approval before adopting 
small business size standards).
    \154\ See ``700 MHz Guard Bands Auction Closes: Winning Bidders 
Announced,'' Public Notice, 15 FCC Rcd 18026 (2000).
    \155\ See ``700 MHz Guard Bands Auction Closes: Winning Bidders 
Announced,'' Public Notice, 16 FCC Rcd 4590 (WTB 2001).
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    89. Specialized Mobile Radio. The Commission awards ``small 
entity'' bidding credits in auctions for Specialized Mobile Radio (SMR) 
geographic area licenses in the 800 MHz and 900 MHz bands to firms that 
had revenues of no more than $15 million in each of the three previous 
calendar years.\156\ The Commission awards ``very small entity'' 
bidding credits to firms that had revenues of no more than $3 million 
in each of the three previous calendar years.\157\ The SBA has approved 
these small business size standards for the 900 MHz Service.\158\ The 
Commission has held auctions for geographic area licenses in the 800 
MHz and 900 MHz bands. The 900 MHz SMR auction began on December 5, 
1995, and closed on April 15, 1996. Sixty bidders claiming that they 
qualified as small businesses under the $15 million size standard won 
263 geographic area licenses in the 900 MHz SMR band. The 800 MHz SMR 
auction for the upper 200 channels began on October 28, 1997, and was 
completed on December 8, 1997. Ten bidders claiming that they qualified 
as small businesses under the $15 million size standard won 38 
geographic area licenses for the upper 200 channels in the 800 MHz SMR 
band.\159\ A second auction for the 800 MHz band was held on January 
10, 2002 and closed on January 17, 2002 and included 23 BEA licenses. 
One bidder claiming small business status won five licenses.\160\
---------------------------------------------------------------------------

    \156\ 47 CFR 90.814(b)(1).
    \157\ 47 CFR 90.814(b)(1).
    \158\ See Letter to Thomas Sugrue, Chief, Wireless 
Telecommunications Bureau, Federal Communications Commission, from 
Aida Alvarez, Administrator, Small Business Administration, dated 
August 10, 1999. We note that, although a request was also sent to 
the SBA requesting approval for the small business size standard for 
800 MHz, approval is still pending.
    \159\ See ``Correction to Public Notice DA 96-586 `FCC Announces 
Winning Bidders in the Auction of 1020 Licenses to Provide 900 MHz 
SMR in Major Trading Areas,' '' Public Notice, 18 FCC Rcd 18367 (WTB 
1996).
    \160\ See ``Multi-Radio Service Auction Closes,'' Public Notice, 
17 FCC Rcd 1446 (WTB 2002).
---------------------------------------------------------------------------

    90. The auction of the 1,053 800 MHz SMR geographic area licenses 
for the General Category channels began on August 16, 2000, and was 
completed on September 1, 2000. Eleven bidders won 108 geographic area 
licenses for the General Category channels in the 800 MHz SMR band 
qualified as small businesses under the $15 million size standard.\161\ 
In an auction completed on December 5, 2000, a total of 2,800 Economic 
Area licenses in the lower 80 channels of the 800 MHz SMR service were 
sold.\162\ Of the 22 winning bidders, 19 claimed small business status 
and won 129 licenses. Thus, combining all three auctions, 40 winning 
bidders for geographic licenses in the 800 MHz SMR band claimed status 
as small business.
---------------------------------------------------------------------------

    \161\ See, ``800 MHz Specialized Mobile Radio (SMR) Service 
General Category (851-854 MHz) and Upper Band (861-865 MHz) Auction 
Closes; Winning Bidders Announced,'' Public Notice, 15 FCC Rcd 17162 
(2000).
    \162\ See, ``800 MHz SMR Service Lower 80 Channels Auction 
Closes; Winning Bidders Announced,'' Public Notice, 16 FCC Rcd 1736 
(2000).
---------------------------------------------------------------------------

    91. In addition, there are numerous incumbent site-by-site SMR 
licensees and licensees with extended implementation authorizations in 
the 800 and 900 MHz bands. We do not know how many firms provide 800 
MHz or 900 MHz geographic area SMR pursuant to extended implementation 
authorizations, nor how many of these providers have annual revenues of 
no more than $15 million. One firm has over $15 million in revenues. We 
assume, for purposes of this analysis, that all of the remaining 
existing extended implementation authorizations are held by small 
entities, as that small business size standard is approved by the SBA.
    92. 220 MHz Radio Service--Phase I Licensees. The 220 MHz service 
has both Phase I and Phase II licenses. Phase I licensing was conducted 
by lotteries in 1992 and 1993. There are approximately 1,515 such non-
nationwide licensees and four nationwide licensees currently authorized 
to operate in the 220 MHz band. The Commission has not developed a 
definition of small entities specifically applicable to such incumbent 
220 MHz Phase I licensees. To estimate the number of such licensees 
that are small businesses, we apply the small business size standard 
under the SBA rules applicable to ``Cellular and Other Wireless 
Telecommunications'' companies. This category provides that a small 
business is a wireless company employing no more than 1,500 
persons.\163\ According to the Census Bureau data for 1997, only twelve 
firms out of a total of 1,238 such firms that operated for the entire 
year in 1997, had 1,000 or more employees.\164\ If this general ratio 
continues in the context of Phase I 220 MHz licensees, the Commission 
estimates that nearly all such licensees are small businesses

[[Page 41981]]

under the SBA's small business standard.
---------------------------------------------------------------------------

    \163\ 13 CFR 121.201, NAICS code 513322 (changed to 517212 in 
October 2002).
    \164\ U.S. Census Bureau, 1997 Economic Census, Subject Series: 
Information, ``Establishment and Firm Size (Including Legal Form of 
Organization),'' Table 5, NAICS code 513322 (October 2000).
---------------------------------------------------------------------------

    93. 220 MHz Radio Service--Phase II Licensees. The 220 MHz service 
has both Phase I and Phase II licenses. The Phase II 220 MHz service is 
a new service, and is subject to spectrum auctions. In the 220 MHz 
Third Report and Order, we adopted a small business size standard for 
defining ``small'' and ``very small'' businesses for purposes of 
determining their eligibility for special provisions such as bidding 
credits and installment payments.\165\ This small business standard 
indicates that a ``small business'' is an entity that, together with 
its affiliates and controlling principals, has average gross revenues 
not exceeding $15 million for the preceding three years.\166\ A ``very 
small business'' is defined as an entity that, together with its 
affiliates and controlling principals, has average gross revenues that 
do not exceed $3 million for the preceding three years.\167\ The SBA 
has approved these small size standards.\168\ Auctions of Phase II 
licenses commenced on September 15, 1998, and closed on October 22, 
1998.\169\ In the first auction, 908 licenses were auctioned in three 
different-sized geographic areas: Three nationwide licenses, 30 
Regional Economic Area Group (EAG) Licenses, and 875 Economic Area (EA) 
Licenses. Of the 908 licenses auctioned, 693 were sold.\170\ Thirty-
nine small businesses won 373 licenses in the first 220 MHz auction. A 
second auction included 225 licenses: 216 EA licenses and 9 EAG 
licenses. Fourteen companies claiming small business status won 158 
licenses.\171\ A third auction included four licenses: 2 BEA licenses 
and 2 EAG licenses in the 220 MHz Service. No small or very small 
business won any of these licenses.\172\
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    \165\ Amendment of Part 90 of the Commission's Rules to Provide 
For the Use of the 220-222 MHz Band by the Private Land Mobile Radio 
Service, Third Report and Order, 12 FCC Rcd 10943, 11068-70, paras. 
291-295 (1997).
    \166\ Id. at 11068, paras. 291.
    \167\ Id.
    \168\ See Letter to Daniel Phythyon, Chief, Wireless 
Telecommunications Bureau, Federal Communications Commission, from 
Aida Alvarez, Administrator, Small Business Administration, dated 
January 6, 1998.
    \169\ See generally ``220 MHz Service Auction Closes,'' Public 
Notice, 14 FCC Rcd 605 (WTB 1998).
    \170\ See ``FCC Announces It is Prepared to Grant 654 Phase II 
220 MHz Licenses After Final Payment is Made,'' Public Notice, 14 
FCC Rcd 1085 (WTB 1999).
    \171\ See ``Phase II 220 MHz Service Spectrum Auction Closes,'' 
Public Notice, 14 FCC Rcd 11218 (WTB 1999).
    \172\ See ``Multi-Radio Service Auction Closes,'' Public Notice, 
17 FCC Rcd 1446 (WTB 2002).
---------------------------------------------------------------------------

    94. Private Land Mobile Radio (PLMR). PLMR systems serve an 
essential role in a range of industrial, business, land transportation, 
and public safety activities. These radios are used by companies of all 
sizes operating in all U.S. business categories, and are often used in 
support of the licensee's primary (non-telecommunications) business 
operations. For the purpose of determining whether a licensee of a PLMR 
system is a small business as defined by the SBA, we could use the 
definition for ``Cellular and Other Wireless Telecommunications.'' This 
definition provides that a small entity is any such entity employing no 
more than 1,500 persons.\173\ The Commission does not require PLMR 
licensees to disclose information about number of employees, so the 
Commission does not have information that could be used to determine 
how many PLMR licensees constitute small entities under this 
definition. Moreover, because PMLR licensees generally are not in the 
business of providing cellular or other wireless telecommunications 
services but instead use the licensed facilities in support of other 
business activities, we are not certain that the Cellular and Other 
Wireless Telecommunications category is appropriate for determining how 
many PLMR licensees are small entities for this analysis. Rather, it 
may be more appropriate to assess PLMR licensees under the standards 
applied to the particular industry subsector to which the licensee 
belongs.\174\
---------------------------------------------------------------------------

    \173\ See 13 CFR 121.201, NAICS code 517212.
    \174\ See generally 13 CFR 121.201.
---------------------------------------------------------------------------

    95. The Commission's 1994 Annual Report on PLMRs \175\ indicates 
that at the end of fiscal year 1994, there were 1,087,267 licensees 
operating 12,481,989 transmitters in the PLMR bands below 512 MHz. 
Because any entity engaged in a commercial activity is eligible to hold 
a PLMR license, the revised rules in this context could potentially 
impact every small business in the United States.
---------------------------------------------------------------------------

    \175\ Federal Communications Commission, 60th Annual Report, 
Fiscal Year 1994, at para. 116.
---------------------------------------------------------------------------

    96. Fixed Microwave Services. Fixed microwave services include 
common carrier,\176\ private operational-fixed,\177\ and broadcast 
auxiliary radio services.\178\ At present, there are approximately 
22,015 common carrier fixed licensees and 61,670 private operational-
fixed licensees and broadcast auxiliary radio licensees in the 
microwave services. The Commission has not created a size standard for 
a small business specifically with respect to fixed microwave services. 
For purposes of this analysis, the Commission uses the SBA small 
business size standard for the category ``Cellular and Other 
Telecommunications,'' which is 1,500 or fewer employees.\179\ The 
Commission does not have data specifying the number of these licensees 
that have more than 1,500 employees, and thus are unable at this time 
to estimate with greater precision the number of fixed microwave 
service licensees that would qualify as small business concerns under 
the SBA's small business size standard. Consequently, the Commission 
estimates that there are up to 22,015 common carrier fixed licensees 
and up to 61,670 private operational-fixed licensees and broadcast 
auxiliary radio licensees in the microwave services that may be small 
and may be affected by the rules and policies proposed herein. We 
noted, however, that the common carrier microwave fixed licensee 
category includes some large entities.
---------------------------------------------------------------------------

    \176\ See 47 CFR 101 et seq. (formerly, part 21 of the 
Commission's rules) for common carrier fixed microwave services 
(except Multipoint Distribution Service).
    \177\ Persons eligible under parts 80 and 90 of the Commission's 
rules can use Private Operational-Fixed Microwave services. See 47 
CFR parts 80 and 90. Stations in this service are called 
operational-fixed to distinguish them from common carrier and public 
fixed stations. Only the licensee may use the operational-fixed 
station, and only for communications related to the licensee's 
commercial, industrial, or safety operations.
    \178\ Auxiliary Microwave Service is governed by part 74 of 
Title 47 of the Commission's rules. See 47 CFR part 74. This service 
is available to licensees of broadcast stations and to broadcast and 
cable network entities. Broadcast auxiliary microwave stations are 
used for relaying broadcast television signals from the studio to 
the transmitter, or between two points such as a main studio and an 
auxiliary studio. The service also includes mobile television 
pickups, which relay signals from a remote location back to the 
studio.
    \179\ 13 CFR 121.201, NAICS code 513322 (changed to 517212 in 
October 2002).
---------------------------------------------------------------------------

    97. 39 GHz Service. The Commission created a special small business 
size standard for 39 GHz licenses--an entity that has average gross 
revenues of $40 million or less in the three previous calendar 
years.\180\ An additional size standard for ``very small business'' is: 
An entity that, together with affiliates, has average gross revenues of 
not more than $15 million for the preceding three calendar years.\181\ 
The SBA has approved these small business size standards.\182\ The 
auction of the 2,173

[[Page 41982]]

39 GHz licenses began on April 12, 2000 and closed on May 8, 2000. The 
18 bidders who claimed small business status won 849 licenses. 
Consequently, the Commission estimates that 18 or fewer 39 GHz 
licensees are small entities that may be affected by the rules and 
polices herein.
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    \180\ See Amendment of the Commission's Rules Regarding the 
37.0-38.6 GHz and 38.6-40.0 GHz Bands, ET Docket No. 95-183, Report 
and Order, 12 FCC Rcd 18600 (1997), 63 FR 6079 (Feb. 6, 1998).
    \182\ Id.
    \182\ See Letter to Kathleen O'Brien Ham, Chief, Auctions and 
Industry Analysis Division, Wireless Telecommunications Bureau, FCC, 
from Aida Alvarez, Administrator, SBA (Feb. 4, 1998) (VoIP); See 
Letter to Margaret Wiener, Chief, Auctions and Industry Analysis 
Division, Wireless Telecommunications Bureau, Federal Communications 
Commission, from Hector Barreto, Administrator, Small Business 
Administration, dated January 18, 2002 (WTB).
---------------------------------------------------------------------------

    98. Local Multipoint Distribution Service. Local Multipoint 
Distribution Service (LMDS) is a fixed broadband point-to-multipoint 
microwave service that provides for two-way video 
telecommunications.\183\ The auction of the 986 Local Multipoint 
Distribution Service (LMDS) licenses began on February 18, 1998 and 
closed on March 25, 1998. The Commission established a small business 
size standard for LMDS licenses as an entity that has average gross 
revenues of less than $40 million in the three previous calendar 
years.\184\ An additional small business size standard for ``very small 
business'' was added as an entity that, together with its affiliates, 
has average gross revenues of not more than $15 million for the 
preceding three calendar years.\185\ The SBA has approved these small 
business size standards in the context of LMDS auctions.\186\ There 
were 93 winning bidders that qualified as small entities in the LMDS 
auctions. A total of 93 small and very small business bidders won 
approximately 277 A Block licenses and 387 B Block licenses. On March 
27, 1999, the Commission re-auctioned 161 licenses; there were 32 small 
and very small business winning that won 119 licenses.
---------------------------------------------------------------------------

    \183\ See Rulemaking to Amend Parts 1, 2, 21, 25, of the 
Commission's Rules to Redesignate the 27.5-29.5 GHz Frequency Band, 
Reallocate the 29.5-30.5 Frequency Band, to Establish Rules and 
Policies for Local Multipoint Distribution Service and for Fixed 
Satellite Services, Second Report and Order, Order on 
Reconsideration, and Fifth Notice of Proposed Rule Making, 12 FCC 
Rcd 12545, 12689-90, para. 348 (1997).
    \184\ See Rulemaking to Amend Parts 1, 2, 21, 25, of the 
Commission's Rules to Redesignate the 27.5-29.5 GHz Frequency Band, 
Reallocate the 29.5-30.5 Frequency Band, to Establish Rules and 
Policies for Local Multipoint Distribution Service and for Fixed 
Satellite Services, Second Report and Order, Order on 
Reconsideration, and Fifth Notice of Proposed Rule Making, 12 FCC 
Rcd 12545, 12689-90, para. 348 (1997).
    \185\ See Rulemaking to Amend Parts 1, 2, 21, 25, of the 
Commission's Rules to Redesignate the 27.5-29.5 GHz Frequency Band, 
Reallocate the 29.5-30.5 Frequency Band, to Establish Rules and 
Policies for Local Multipoint Distribution Service and for Fixed 
Satellite Services, Second Report and Order, Order on 
Reconsideration, and Fifth Notice of Proposed Rule Making, 12 FCC 
Rcd 12545, 12689-90, para. 348 (1997).
    \186\ See Letter to Dan Phythyon, Chief, Wireless 
Telecommunications Bureau, FCC, from Aida Alvarez, Administrator, 
SBA (Jan. 6, 1998).
---------------------------------------------------------------------------

    99. 218-219 MHz Service. The first auction of 218-219 MHz 
(previously referred to as the Interactive and Video Data Service or 
IVDS) spectrum resulted in 178 entities winning licenses for 594 
Metropolitan Statistical Areas (MSAs).\187\ Of the 594 licenses, 567 
were won by 167 entities qualifying as a small business. For that 
auction, we defined a small business as an entity that, together with 
its affiliates, has no more than a $6 million net worth and, after 
federal income taxes (excluding any carry over losses), has no more 
than $2 million in annual profits each year for the previous two 
years.\188\ In the 218-219 MHz Report and Order and Memorandum Opinion 
and Order, we defined a small business as an entity that, together with 
its affiliates and persons or entities that hold interests in such an 
entity and their affiliates, has average annual gross revenues not 
exceeding $15 million for the preceding three years.\189\ A very small 
business is defined as an entity that, together with its affiliates and 
persons or entities that hold interests in such an entity and its 
affiliates, has average annual gross revenues not exceeding $3 million 
for the preceding three years.\190\ The SBA has approved of these 
definitions.\191\ At this time, we cannot estimate the number of 
licenses that will be won by entities qualifying as small or very small 
businesses under our rules in future auctions of 218-219 MHz spectrum. 
Given the success of small businesses in previous auction, and the 
prevalence of small businesses in the subscription television services 
and message communications industries, we assume for purposes of this 
analysis that in future auctions, many, and perhaps all, of the 
licenses may be awarded to small businesses.
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    \187\ See ``Interactive Video and Data Service (IVDS) 
Applications Accepted for Filing,'' Public Notice, 9 FCC Rcd 6227 
(1994).
    \188\ Implementation of Section 309(j) of the Communications 
Act--Competitive Bidding, Fourth Report and Order, 9 FCC Rcd 2330 
(1994).
    \189\ Amendment of Part 95 of the Commission's Rules to Provide 
Regulatory Flexibility in the 218-219 MHz Service, Report and Order 
and Memorandum Opinion and Order, 15 FCC Rcd 1497 (1999).
    \190\ Id.
    \191\ See Letter to Daniel Phythyon, Chief, Wireless 
Telecommunications Bureau, Federal Communications Commission, from 
Aida Alvarez, Administrator, Small Business Administration, dated 
January 6, 1998.
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    100. Location and Monitoring Service (LMS). Multilateration LMS 
systems use non-voice radio techniques to determine the location and 
status of mobile radio units. For purposes of auctioning LMS licenses, 
the Commission has defined ``small business'' as an entity that, 
together with controlling interests and affiliates, has average annual 
gross revenues for the preceding three years not exceeding $15 
million.\192\ A ``very small business'' is defined as an entity that, 
together with controlling interests and affiliates, has average annual 
gross revenues for the preceding three years not exceeding $3 
million.\193\ These definitions have been approved by the SBA.\194\ An 
auction for LMS licenses commenced on February 23, 1999, and closed on 
March 5, 1999. Of the 528 licenses auctioned, 289 licenses were sold to 
four small businesses. We cannot accurately predict the number of 
remaining licenses that could be awarded to small entities in future 
LMS auctions.
---------------------------------------------------------------------------

    \192\ Amendment of Part 90 of the Commission's Rules to Adopt 
Regulations for Automatic Vehicle Monitoring Systems, Second Report 
and Order, 13 FCC Rcd 15182, 15192 para. 20 (1998); see also 47 CFR 
90.1103.
    \193\ Amendment of Part 90 of the Commission's Rules to Adopt 
Regulations for Automatic Vehicle Monitoring Systems, Second Report 
and Order, 13 FCC Rcd at 15192, para. 20; see also 47 CFR 90.1103.
    \194\ See Letter to Thomas Sugrue, Chief, Wireless 
Telecommunications Bureau, Federal Communications Commission, from 
Aida Alvarez, Administrator, Small Business Administration, dated 
February 22, 1999.
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    101. Rural Radiotelephone Service. The Commission has not adopted a 
size standard for small businesses specific to the Rural Radiotelephone 
Service.\195\ A significant subset of the Rural Radiotelephone Service 
is the Basic Exchange Telephone Radio System (BETRS).\196\ The 
Commission uses the SBA's small business size standard applicable to 
``Cellular and Other Wireless Telecommunications,'' i.e., an entity 
employing no more than 1,500 persons.\197\ There are approximately 
1,000 licensees in the Rural Radiotelephone Service, and the Commission 
estimates that there are 1,000 or fewer small entity licensees in the 
Rural Radiotelephone Service that may be affected by the rules and 
policies proposed herein.
    102. Air-Ground Radiotelephone Service. The Commission has not 
adopted a small business size standard specific to the Air-Ground 
Radiotelephone Service.\198\ We will use SBA's small business size 
standard applicable to ``Cellular and Other Wireless 
Telecommunications,'' i.e., an

[[Page 41983]]

entity employing no more than 1,500 persons.\199\ There are 
approximately 100 licensees in the Air-Ground Radiotelephone Service, 
and we estimate that almost all of them qualify as small under the SBA 
small business size standard.
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    \195\ The service is defined in section 22.99 of the 
Commission's Rules, 47 CFR 22.99.
    \196\ BETRS is defined in sections 22.757 and 22.759 of the 
Commission's Rules, 47 CFR 22.757 and 22.759.
    \197\ 13 CFR 121.201, NAICS code 513322 (changed to 517212 in 
October 2002).
    \198\ The service is defined in section 22.99 of the 
Commission's Rules, 47 CFR 22.99.
    \199\ 13 CFR 121.201, NAICS codes 513322 (changed to 517212 in 
October 2002).
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    103. Aviation and Marine Radio Services. Small businesses in the 
aviation and marine radio services use a very high frequency (VHF) 
marine or aircraft radio and, as appropriate, an emergency position-
indicating radio beacon (and/or radar) or an emergency locator 
transmitter. The Commission has not developed a small business size 
standard specifically applicable to these small businesses. For 
purposes of this analysis, the Commission uses the SBA small business 
size standard for the category ``Cellular and Other 
Telecommunications,'' which is 1,500 or fewer employees.\200\ Most 
applicants for recreational licenses are individuals. Approximately 
581,000 ship station licensees and 131,000 aircraft station licensees 
operate domestically and are not subject to the radio carriage 
requirements of any statute or treaty. For purposes of our evaluations 
in this analysis, we estimate that there are up to approximately 
712,000 licensees that are small businesses (or individuals) under the 
SBA standard. In addition, between December 3, 1998 and December 14, 
1998, the Commission held an auction of 42 VHF Public Coast licenses in 
the 157.1875-157.4500 MHz (ship transmit) and 161.775-162.0125 MHz 
(coast transmit) bands. For purposes of the auction, the Commission 
defined a ``small'' business as an entity that, together with 
controlling interests and affiliates, has average gross revenues for 
the preceding three years not to exceed $15 million dollars. In 
addition, a ``very small'' business is one that, together with 
controlling interests and affiliates, has average gross revenues for 
the preceding three years not to exceed $3 million dollars.\201\ There 
are approximately 10,672 licensees in the Marine Coast Service, and the 
Commission estimates that almost all of them qualify as ``small'' 
businesses under the above special small business size standards.
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    \200\ 13 CFR 121.201, NAICS code 513322 (changed to 517212 in 
October 2002).
    \201\ Amendment of the Commission's Rules Concerning Maritime 
Communications, PR Docket No. 92-257, Third Report and Order and 
Memorandum Opinion and Order, 13 FCC Rcd 19853 (1998).
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    104. Offshore Radiotelephone Service. This service operates on 
several ultra high frequencies (UHF) television broadcast channels that 
are not used for television broadcasting in the coastal areas of states 
bordering the Gulf of Mexico.\202\ There are presently approximately 55 
licensees in this service. We are unable to estimate at this time the 
number of licensees that would qualify as small under the SBA's small 
business size standard for ``Cellular and Other Wireless 
Telecommunications'' services.\203\ Under that SBA small business size 
standard, a business is small if it has 1,500 or fewer employees.\204\
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    \202\ This service is governed by Subpart I of Part 22 of the 
Commission's Rules. See 47 CFR 22.1001-22.1037.
    \203\ 13 CFR 121.201, NAICS code 513322 (changed to 517212 in 
October 2002).
    \204\ Id.
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    105. Multiple Address Systems (MAS). Entities using MAS spectrum, 
in general, fall into two categories: (1) Those using the spectrum for 
profit-based uses, and (2) those using the spectrum for private 
internal uses. With respect to the first category, the Commission 
defines ``small entity'' for MAS licenses as an entity that has average 
gross revenues of less than $15 million in the three previous calendar 
years.\205\ ``Very small business'' is defined as an entity that, 
together with its affiliates, has average gross revenues of not more 
than $3 million for the preceding three calendar years.\206\ The SBA 
has approved of these definitions.\207\ The majority of these entities 
will most likely be licensed in bands where the Commission has 
implemented a geographic area licensing approach that would require the 
use of competitive bidding procedures to resolve mutually exclusive 
applications. The Commission's licensing database indicates that, as of 
January 20, 1999, there were a total of 8,670 MAS station 
authorizations. Of these, 260 authorizations were associated with 
common carrier service. In addition, an auction for 5,104 MAS licenses 
in 176 EAs began November 14, 2001, and closed on November 27, 
2001.\208\ Seven winning bidders claimed status as small or very small 
businesses and won 611 licenses.
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    \205\ See Amendment of the Commission's Rules Regarding Multiple 
Address Systems, Report and Order, 15 FCC Rcd 11956, 12008, para. 
123 (2000).
    \206\ Id.
    \207\ See Letter to Thomas Sugrue, Chief, Wireless 
Telecommunications Bureau, Federal Communications Commission, from 
Aida Alvarez, Administrator, Small Business Administration, dated 
June 4, 1999.
    \208\ See ``Multiple Address Systems Spectrum Auction Closes,'' 
Public Notice, 16 FCC Rcd 21011 (2001).
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    106. With respect to the second category, which consists of 
entities that use, or seek to use, MAS spectrum to accommodate internal 
communications needs, we note that MAS serves an essential role in a 
range of industrial, safety, business, and land transportation 
activities. MAS radios are used by companies of all sizes, operating in 
virtually all U.S. business categories, and by all types of public 
safety entities. For the majority of private internal users, the 
definitions developed by the SBA would be more appropriate. The 
applicable definition of small entity in this instance appears to be 
the ``Cellular and Other Wireless Telecommunications'' definition under 
the SBA rules. This definition provides that a small entity is any 
entity employing no more than 1,500 persons.\209\ The Commission's 
licensing database indicates that, as of January 20, 1999, of the 8,670 
total MAS station authorizations, 8,410 authorizations were for private 
radio service, and of these, 1,433 were for private land mobile radio 
service.
---------------------------------------------------------------------------

    \209\ See 13 CFR 121.201, NAICS code 517212.
---------------------------------------------------------------------------

    107. Incumbent 24 GHz Licensees. This analysis may affect incumbent 
licensees who were relocated to the 24 GHz band from the 18 GHz band, 
and applicants who wish to provide services in the 24 GHz band. The 
applicable SBA small business size standard is that of ``Cellular and 
Other Wireless Telecommunications'' companies. This category provides 
that such a company is small if it employs no more than 1,500 
persons.\210\ According to Census Bureau data for 1997, there were 977 
firms in this category, total, that operated for the entire year.\211\ 
Of this total, 965 firms had employment of 999 or fewer employees, and 
an additional 12 firms had employment of 1,000 employees or more.\212\ 
Thus, under this size standard, the great majority of firms can be 
considered small. These broader census data notwithstanding, we believe 
that there are only two licensees in the 24 GHz band that were 
relocated from the 18 GHz band, Teligent \213\ and TRW, Inc. It is our 
understanding that Teligent and its related companies have less than 
1,500 employees, though this may

[[Page 41984]]

change in the future. TRW is not a small entity. Thus, only one 
incumbent licensee in the 24 GHz band is a small business entity.
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    \210\ 13 CFR 121.201, NAICS code 513322 (changed to 517212 in 
October 2002).
    \211\ U.S. Census Bureau, 1997 Economic Census, Subject Series: 
Information, ``Employment Size of Firms Subject to Federal Income 
Tax: 1997,'' Table 5, NAICS code 513322 (issued October 2000).
    \212\ Id. The census data do not provide a more precise estimate 
of the number of firms that have employment of 1,500 or fewer 
employees; the largest category provided is ``Firms with 1,000 
employees or more.''
    \213\ Teligent acquired the DEMS licenses of FirstMark, the only 
licensee other than TRW in the 24 GHz band whose license has been 
modified to require relocation to the 24 GHz band.
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    108. Future 24 GHz Licensees. With respect to new applicants in the 
24 GHz band, we have defined ``small business'' as an entity that, 
together with controlling interests and affiliates, has average annual 
gross revenues for the three preceding years not exceeding $15 
million.\214\ ``Very small business'' in the 24 GHz band is defined as 
an entity that, together with controlling interests and affiliates, has 
average gross revenues not exceeding $3 million for the preceding three 
years.\215\ The SBA has approved these definitions.\216\ The Commission 
will not know how many licensees will be small or very small businesses 
until the auction, if required, is held.
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    \214\ Amendments to Parts 1, 2, 87 and 101 of the Commission's 
Rules To License Fixed Services at 24 GHz, Report and Order, 15 FCC 
Rcd 16934, 16967, para. 77 (2000) (24 GHz Report and Order); see 
also 47 CFR 101.538(a)(2).
    \215\ 24 GHz Report and Order, 15 FCC Rcd at 16967, para. 77; 
see also 47 CFR 101.538(a)(1).
    \216\ See Letter to Margaret W. Wiener, Deputy Chief, Auctions 
and Industry Analysis Division, Wireless Telecommunications Bureau, 
Federal Communications Commission, from Gary M. Jackson, Assistant 
Administrator, Small Business Administration, dated July 28, 2000.
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    109. Multipoint Distribution Service, Multichannel Multipoint 
Distribution Service, and Instructional Television Fixed Service. 
Multichannel Multipoint Distribution Service (MMDS) systems, often 
referred to as ``wireless cable,'' transmit video programming to 
subscribers using the microwave frequencies of the Multipoint 
Distribution Service (MDS) and Instructional Television Fixed Service 
(ITFS).\217\ In connection with the 1996 MDS auction, the Commission 
defined--small business'' as an entity that, together with its 
affiliates, has average gross annual revenues that are not more than 
$40 million for the preceding three calendar years.\218\ The SBA has 
approved of this standard.\219\ The MDS auction resulted in 67 
successful bidders obtaining licensing opportunities for 493 Basic 
Trading Areas (BTAs).\220\ Of the 67 auction winners, 61 claimed status 
as a small business. At this time, we estimate that of the 61 small 
business MDS auction winners, 48 remain small business licensees. In 
addition to the 48 small businesses that hold BTA authorizations, there 
are approximately 392 incumbent MDS licensees that have gross revenues 
that are not more than $40 million and are thus considered small 
entities.\221\
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    \217\ Amendment of Parts 21 and 74 of the Commission's Rules 
with Regard to Filing Procedures in the Multipoint Distribution 
Service and in the Instructional Television Fixed Service and 
Implementation of Section 309(j) of the Communications Act--
Competitive Bidding, Report and Order, 10 FCC Rcd 9589, 9593, para. 
7 (1995) (MDS Auction R&O).
    \218\ 47 CFR 21.961(b)(1).
    \219\ See Letter to Margaret Wiener, Chief, Auctions and 
Industry Analysis Division, Wireless Telecommunications Bureau, 
Federal Communications Bureau, from Gary Jackson, Assistant 
Administrator for Size Standards, Small Business Administration, 
dated March 20, 2003 (noting approval of $40 million size standard 
for MDS auction).
    \220\ Basic Trading Areas (BTAs) were designed by Rand McNally 
and are the geographic areas by which MDS was auctioned and 
authorized. See MDS Auction R&O, 10 FCC Rcd at 9608, paragraph 34.
    \221\ 47 U.S.C. 309(j). Hundreds of stations were licensed to 
incumbent MDS licensees prior to implementation of Section 309(j) of 
the Communications Act of 1934, 47 U.S.C. 309(j). For these pre-
auction licenses, the applicable standard is SBA's small business 
size standard for ``other telecommunications'' (annual receipts of 
$12.5 million or less). See 13 CFR 121.201, NAICS code 517910.
---------------------------------------------------------------------------

    110. In addition, the SBA has developed a small business size 
standard for Cable and Other Program Distribution,\222\ which includes 
all such companies generating $12.5 million or less in annual 
receipts.\223\ According to Census Bureau data for 1997, there were a 
total of 1,311 firms in this category, total, that had operated for the 
entire year.\224\ Of this total, 1,180 firms had annual receipts of 
under $10 million, and an additional 52 firms had receipts of $10 
million or more but less than $25 million.\225\ Consequently, we 
estimate that the majority of providers in this service category are 
small businesses that may be affected by the proposed rules and 
policies.
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    \222\ 13 CFR 121.201, NAICS code 517510.
    \223\ Id.
    \224\ U.S. Census Bureau, 1997 Economic Census, Subject Series: 
Information, ``Establishment and Firm Size (Including Legal Form of 
Organization),'' Table 4 (issued October 2000).
    \225\ Id.
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    111. Finally, while SBA approval for a Commission-defined small 
business size standard applicable to ITFS is pending, educational 
institutions are included in this analysis as small entities.\226\ 
There are currently 2,032 ITFS licensees, and all but 100 of these 
licenses are held by educational institutions. Thus, we tentatively 
conclude that at least 1,932 ITFS licensees are small businesses.
---------------------------------------------------------------------------

    \226\ In addition, the term ``small entity'' under SBREFA 
applies to small organizations (nonprofits) and to small 
governmental jurisdictions (cities, counties, towns, townships, 
villages, school districts, and special districts with populations 
of less than 50,000). 5 U.S.C. 601(4)-(6). We do not collect annual 
revenue data on ITFS licensees.
---------------------------------------------------------------------------

    112. Television Broadcasting. The Small Business Administration 
defines a television broadcasting station that has no more than $12 
million in annual receipts as a small business.\227\ Business concerns 
included in this industry are those ``primarily engaged in broadcasting 
images together with sound.'' \228\ According to Commission staff 
review of the BIA Publications, Inc. Master Access Television Analyzer 
Database as of May 16, 2003, about 814 of the 1,220 commercial 
television stations in the United States have revenues of $12 million 
or less. We note, however, that, in assessing whether a business 
concern qualifies as small under the above definition, business 
(control) affiliations \229\ must be included. Our estimate, therefore, 
likely overstates the number of small entities that might be affected 
by our action, because the revenue figure on which it is based does not 
include or aggregate revenues from affiliated companies. There are also 
2,053 low power television stations (LPTV).\230\ Given the nature of 
this service, we will presume that all LPTV licensees qualify as small 
entities under the SBA definition.
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    \227\ See OMB, North American Industry Classification System: 
United States, 1997 at 509 (1997) (NAICS code 513120, which was 
changed to code 515120 in October 2002).
    \228\ OMB, North American Industry Classification System: United 
States, 1997, at 509 (1997) (NAICS code 513120, which was changed to 
code 51520 in October 2002). This category description continues, 
``These establishments operate television broadcasting studios and 
facilities for the programming and transmission of programs to the 
public. These establishments also produce or transmit visual 
programming to affiliated broadcast television stations, which in 
turn broadcast the programs to the public on a predetermined 
schedule. Programming may originate in their own studios, from an 
affiliated network, or from external sources.'' Separate census 
categories pertain to businesses primarily engaged in producing 
programming. See id. at 502-05, NAICS code 51210. Motion Picture and 
Video Production: code 512120, Motion Picture and Video 
Distribution, code 512191, Teleproduction and Other Post-Production 
Services, and code 512199, Other Motion Picture and Video 
Industries.
    \229\ ``Concerns are affiliates of each other when one concern 
controls or has the power to control the other or a third party or 
parties controls or has to power to control both.'' 13 CFR 
121.103(a)(1).
    \230\ FCC News Release, ``Broadcast Station Totals as of 
September 30, 2004.''
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    113. In addition, an element of the definition of ``small 
business'' is that the entity not be dominant in its field of 
operation. We are unable at this time to define or quantify the 
criteria that would establish whether a specific television station is 
dominant in its field of operation. Accordingly, the estimate of small 
businesses to which rules may apply do not exclude any television 
station from the definition of a small business on this basis and are 
therefore over-inclusive to that extent. Also as noted, an additional 
element of the definition of ``small business'' is that the

[[Page 41985]]

entity must be independently owned and operated. We note that it is 
difficult at times to assess these criteria in the context of media 
entities and our estimates of small businesses to which they apply may 
be over-inclusive to this extent.
    114. Radio Broadcasting. The SBA defines a radio broadcast entity 
that has $6 million or less in annual receipts as a small 
business.\231\ Business concerns included in this industry are those 
``primarily engaged in broadcasting aural programs by radio to the 
public.\232\ According to Commission staff review of the BIA 
Publications, Inc., Master Access Radio Analyzer Database, as of May 
16, 2003, about 10,427 of the 10,945 commercial radio stations in the 
United States have revenue of $6 million or less. We note, however, 
that many radio stations are affiliated with much larger corporations 
with much higher revenue, and that in assessing whether a business 
concern qualifies as small under the above definition, such business 
(control) affiliations \233\ are included.\234\ Our estimate, therefore 
likely overstates the number of small businesses that might be affected 
by our action.
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    \231\ See OMB, North American Industry Classification System: 
United States, 1997, at 509 (1997) (Radio Stations) (NAICS code 
513111, which was changed to code 515112 in October 2002).
    \232\ Id.
    \233\ ``Concerns are affiliates of each other when one concern 
controls or has the power to control the other, or a third party or 
parties controls or has the power to control both.'' 13 CFR 
121.103(a)(1).
    \234\ ``SBA counts the receipts or employees of the concern 
whose size is at issue and those of all its domestic and foreign 
affiliates, regardless of whether the affiliates are organized for 
profit, in determining the concern's size.'' 13 CFR 121(a)(4).
---------------------------------------------------------------------------

    115. Auxiliary, Special Broadcast and Other Program Distribution 
Services. This service involves a variety of transmitters, generally 
used to relay broadcast programming to the public (through translator 
and booster stations) or within the program distribution chain (from a 
remote news gathering unit back to the station). The Commission has not 
developed a definition of small entities applicable to broadcast 
auxiliary licensees. The applicable definitions of small entities are 
those, noted previously, under the SBA rules applicable to radio 
broadcasting stations and television broadcasting stations.\235\
---------------------------------------------------------------------------

    \235\ 13 CFR 121.201, NAICS codes 513111 and 513112.
---------------------------------------------------------------------------

    116. The Commission estimates that there are approximately 3,868 FM 
translators and boosters.\236\ The Commission does not collect 
financial information on any broadcast facility, and the Department of 
Commerce does not collect financial information on these auxiliary 
broadcast facilities. We believe that most, if not all, of these 
auxiliary facilities could be classified as small businesses by 
themselves. We also recognize that most commercial translators and 
boosters are owned by a parent station which, in some cases, would be 
covered by the revenue definition of small business entity discussed 
above. These stations would likely have annual revenues that exceed the 
SBA maximum to be designated as a small business ($5 million for a 
radio station or $10.5 million for a TV station). Furthermore, they do 
not meet the Small Business Act's definition of a ``small business 
concern'' because they are not independently owned and operated.\237\
---------------------------------------------------------------------------

    \236\ FCC News Release, ``Broadcast Station Totals as of 
September 30, 2004.''
    \237\ 15 U.S.C. 632.
---------------------------------------------------------------------------

    117. Cable and Other Program Distribution. This category includes 
cable systems operators, closed circuit television services, direct 
broadcast satellite services, multipoint distribution systems, 
satellite master antenna systems, and subscription television services. 
The SBA has developed small business size standard for this census 
category, which includes all such companies generating $12.5 million or 
less in revenue annually.\238\ According to Census Bureau data for 
1997, there were a total of 1,311 firms in this category, total, that 
had operated for the entire year.\239\ Of this total, 1,180 firms had 
annual receipts of under $10 million and an additional 52 firms had 
receipts of $10 million or more but less than $25 million. 
Consequently, the Commission estimates that the majority of providers 
in this service category are small businesses that may be affected by 
the rules and policies herein.
---------------------------------------------------------------------------

    \238\ 13 CFR 121.201, NAICS code 513220 (changed to 517510 in 
October 2002).
    \239\ U.S. Census Bureau, 1997 Economic Census, Subject Series: 
Information, ``Establishment and Firm Size (Including Legal Form of 
Organization)'', Table 4, NAICS code 513220 (issued October 2000).
---------------------------------------------------------------------------

    118. Cable System Operators (Rate Regulation Standard). The 
Commission has developed its own small business size standard for cable 
system operators, for purposes of rate regulation. Under the 
Commission's rules, a ``small cable company'' is one serving fewer than 
400,000 subscribers nationwide.\240\ The most recent estimates indicate 
that there were 1,439 cable operators who qualified as small cable 
system operators at the end of 1995.\241\ Since then, some of those 
companies may have grown to serve over 400,000 subscribers, and others 
may have been involved in transactions that caused them to be combined 
with other cable operators. Consequently, the Commission estimates that 
there are now fewer than 1,439 small entity cable system operators that 
may be affected by the rules and policies herein.
---------------------------------------------------------------------------

    \240\ 47 CFR 76.901(e). The Commission developed this definition 
based on its determination that a small cable system operator is one 
with annual revenues of $100 million or less. Implementation of 
Sections of the 1992 Cable Act: Rate Regulation, Sixth Report and 
Order and Eleventh Order on Reconsideration, 10 FCC Rcd 7393 (1995), 
60 FR 10534 (February 27, 1995).
    \241\ Paul Kagan Associates, Inc., Cable TV Investor, February 
29, 1996 (based on figures for December 30, 1995).
---------------------------------------------------------------------------

    119. Cable System Operators (Telecom Act Standard). The 
Communications Act of 1934, as amended, also contains a size standard 
for small cable system operators, which is ``a cable operator that, 
directly or through an affiliate, serves in the aggregate fewer than 1 
percent of all subscribers in the United States and is not affiliated 
with any entity or entities whose gross annual revenues in the 
aggregate exceed $250,000,000.'' \242\ The Commission has determined 
that there are 65,000,000 subscribers in the United States.\243\ 
Therefore, an operator serving fewer than 650,000 subscribers shall be 
deemed a small operator, if its annual revenues, when combined with the 
total annual revenues of all its affiliates, do not exceed $250 million 
in the aggregate.\244\ Based on available data, the Commission 
estimates that the number of cable operators serving 650,000 
subscribers or fewer, totals 1,450.\245\ The Commission neither 
requests nor collects information on whether cable system operators are 
affiliated with entities whose gross annual revenues exceed $250 
million,\246\ and therefore are unable, at this time, to estimate more 
accurately the number of cable system operators that would qualify as 
small cable operators under the size standard contained in the 
Communications Act of 1934.
---------------------------------------------------------------------------

    \242\ 47 U.S.C. 543(m)(2).
    \243\ See FCC Announces New Subscriber Count for the Definition 
of Small Cable Operator, Public Notice, DA 01-158 (January 24, 
2001).
    \244\ 47 CFR 76.901(f).
    \245\ See FCC Announces New Subscriber Count for the Definition 
of Small Cable Operators, Public Notice, DA-01-0158 (released 
January 24, 2001).
    \246\ The Commission does receive such information on a case-by-
case basis if a cable operator appeals a local franchise authority's 
finding that the operator does not qualify as a small cable operator 
pursuant to section 76.901(f) of the Commission's rules. See 47 CFR 
76.909(b).
---------------------------------------------------------------------------

    120. Open Video Services. Open Video Service (OVS) systems provide 
subscription services.\247\ The SBA has created a small business size 
standard for Cable and Other Program

[[Page 41986]]

Distribution.\248\ This standard provides that a small entity is one 
with $12.5 million or less in annual receipts. The Commission has 
certified approximately 25 OVS operators to serve 75 areas, and some of 
these are currently providing service.\249\ Affiliates of Residential 
Communications Network, Inc. (RCN) received approval to operate OVS 
systems in New York City, Boston, Washington, DC, and other areas. RCN 
has sufficient revenues to assure that they do not qualify as a small 
business entity. Little financial information is available for the 
other entities that are authorized to provide OVS and are not yet 
operational. Given that some entities authorized to provide OVS service 
have not yet begun to generate revenues, the Commission concludes that 
up to 24 OVS operators (those remaining) might qualify as small 
businesses that may be affected by the rules and policies herein.
---------------------------------------------------------------------------

    \247\ See 47 U.S.C. 573.
    \248\ 13 CFR 121.201, NAICS code 513220 (changed to 517510 in 
October 2002).
    \249\ See http://www.fcc.gov/csb/ovs/csovscer.html (current as 
of March 2002).
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    121. Cable Television Relay Service. This service includes 
transmitters generally used to relay cable programming within cable 
television system distribution systems. The SBA has defined a small 
business size standard for Cable and other Program Distribution, 
consisting of all such companies having annual receipts of no more than 
$12.5 million.\250\ According to Census Bureau data for 1997, there 
were 1,311 firms in the industry category Cable and Other Program 
Distribution, total, that operated for the entire year.\251\ Of this 
total, 1,180 firms had annual receipts of $10 million or less, and an 
additional 52 firms had receipts of $10 million or more but less than 
$25 million.\252\ Thus, under this standard, we estimate that the 
majority of providers in this service category are small businesses 
that may be affected by the rules and policies herein.
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    \250\ 13 CFR 121.201, NAICS code 517510.
    \251\ U.S. Census Bureau, 1997 Economic Census, Subject Series: 
Information, ``Establishment and Firm Size (Including Legal Form of 
Organization),'' Table 4 (issued October 2000).
    \252\ Id.
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    122. Multichannel Video Distribution and Data Service. MVDDS is a 
terrestrial fixed microwave service operating in the 12.2-12.7 GHz 
band. No auction has yet been held in this service, although an action 
has been scheduled for January 14, 2004.\253\ Accordingly, there are no 
licensees in this service.
---------------------------------------------------------------------------

    \253\ ``Auctions of Licenses in the Multichannel Video 
Distribution and Data Service Rescheduled for January 14, 2004,'' 
Public Notice, DA 03-2354 (August 28, 2003).
---------------------------------------------------------------------------

    123. Amateur Radio Service. These licensees are believed to be 
individuals, and therefore are not small entities.
    124. Aviation and Marine Services. Small businesses in the aviation 
and marine radio services use a very high frequency (VHF) marine or 
aircraft radio and, as appropriate, an emergency position-indicating 
radio beacon (and/or radar) or an emergency locator transmitter. The 
Commission has not developed a small business size standard 
specifically applicable to these small businesses. For purposes of this 
analysis, the Commission uses the SBA small business size standard for 
the category ``Cellular and Other Telecommunications,'' which is 1,500 
or fewer employees.\254\ Most applicants for recreational licenses are 
individuals. Approximately 581,000 ship station licensees and 131,000 
aircraft station licensees operate domestically and are not subject to 
the radio carriage requirements of any statute or treaty. For purposes 
of our evaluations in this analysis, we estimate that there are up to 
approximately 712,000 licensees that are small businesses (or 
individuals) under the SBA standard. In addition, between December 3, 
1998 and December 14, 1998, the Commission held an auction of 42 VHF 
Public Coast licenses in the 157.1875-157.4500 MHz (ship transmit) and 
161.775-162.0125 MHz (coast transmit) bands. For purposes of the 
auction, the Commission defined a ``small'' business as an entity that, 
together with controlling interests and affiliates, has average gross 
revenues for the preceding three years not to exceed $15 million 
dollars. In addition, a ``very small'' business is one that, together 
with controlling interests and affiliates, has average gross revenues 
for the preceding three years not to exceed $3 million dollars.\255\ 
There are approximately 10,672 licensees in the Marine Coast Service, 
and the Commission estimates that almost all of them qualify as 
``small'' businesses under the above special small business size 
standards.
---------------------------------------------------------------------------

    \254\ 13 CFR 121.201, NAICS code 513322 (changed to 517212 in 
October 2002).
    \255\ Amendment of the Commission's Rules Concerning Maritime 
Communications, Third Report and Order and Memorandum Opinion and 
Order, 13 FCC Rcd 19853 (1998).
---------------------------------------------------------------------------

    125. Personal Radio Services. Personal radio services provide 
short-range, low power radio for personal communications, radio 
signaling, and business communications not provided for in other 
services. The Personal Radio Services include spectrum licensed under 
Part 95 of our rules.\256\ These services include Citizen Band Radio 
Service (CB), General Mobile Radio Service (GMRS), Radio Control Radio 
Service (R/C), Family Radio Service (FRS), Wireless Medical Telemetry 
Service (WMTS), Medical Implant Communications Service (MICS), Low 
Power Radio Service (LPRS), and Multi-Use Radio Service (MURS).\257\ 
There are a variety of methods used to license the spectrum in these 
rule parts, from licensing by rule, to conditioning operation on 
successful completion of a required test, to site-based licensing, to 
geographic area licensing. Under the RFA, the Commission is required to 
make a determination of which small entities are directly affected by 
these rules. Since all such entities are wireless, we apply the 
definition of cellular and other wireless telecommunications, pursuant 
to which a small entity is defined as employing 1,500 or fewer 
persons.\258\ Many of the licensees in these services are individuals, 
and thus are not small entities. In addition, due to the mostly 
unlicensed and shared nature of the spectrum utilized in many of these 
services, the Commission lacks direct information upon which to base an 
estimation of the number of small entities under an SBA definition that 
might be directly affected by these rules.
---------------------------------------------------------------------------

    \256\ 47 CFR part 90.
    \257\ The Citizens Band Radio Service, General Mobile Radio 
Service, Radio Control Radio Service, Family Radio Service, Wireless 
Medical Telemetry Service, Medical Implant Communications Service, 
Low Power Radio Service, and Multi-Use Radio Service are governed by 
Subpart D, Subpart A, Subpart C, Subpart B, Subpart H, Subpart I, 
Subpart G, and Subpart J, respectively, of Part 95 of the 
Commission's rules. See generally 47 CFR part 95.
    \258\ 13 CFR 121.201, NAICS Code 517212.
---------------------------------------------------------------------------

    126. Public Safety Radio Services. Public Safety radio services 
include police, fire, local government, forestry conservation, highway 
maintenance, and emergency medical services.\259\

[[Page 41987]]

There are a total of approximately 127,540 licensees in these services. 
Governmental entities \260\ as well as private businesses comprise the 
licensees for these services. All governmental entities with 
populations of less than 50,000 fall within the definition of a small 
entity.\261\
---------------------------------------------------------------------------

    \259\ With the exception of the special emergency service, these 
services are governed by Subpart B of part 90 of the Commission's 
Rules, 47 CFR 90.15-90.27. The police service includes approximately 
27,000 licensees that serve state, county, and municipal enforcement 
through telephony (voice), telegraphy (code) and teletype and 
facsimile (printed material). The fire radio service includes 
approximately 23,000 licensees comprised of private volunteer or 
professional fire companies as well as units under governmental 
control. The local government service that is presently comprised of 
approximately 41,000 licensees that are state, county, or municipal 
entities that use the radio for official purposes not covered by 
other public safety services. There are approximately 7,000 
licensees within the forestry service which is comprised of 
licensees from state departments of conservation and private forest 
organizations who set up communications networks among fire lookout 
towers and ground crews. The approximately 9,000 state and local 
governments are licensed to highway maintenance service provide 
emergency and routine communications to aid other public safety 
services to keep main roads safe for vehicular traffic. The 
approximately 1,000 licensees in the Emergency Medical Radio Service 
(EMRS) use the 39 channels allocated to this service for emergency 
medical service communications related to the delivery of emergency 
medical treatment. 47 CFR 90.15-90.27. The approximately 20,000 
licensees in the special emergency service include medical services, 
rescue organizations, veterinarians, handicapped persons, disaster 
relief organizations, school buses, beach patrols, establishments in 
isolated areas, communications standby facilities, and emergency 
repair of public communications facilities. 47 CFR 90.33-90.55.
    \260\ 47 CFR 1.1162.
    \261\ 5 U.S.C. 601(5).
---------------------------------------------------------------------------

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

    127. With certain exceptions, the Commission's Schedule of 
Regulatory Fees applies to all Commission licensees and regulatees. 
Most licensees will be required to count the number of licenses or call 
signs authorized, complete and submit an FCC Form 159 (``FCC Remittance 
Advice''), and pay a regulatory fee based on the number of licenses or 
call signs.\262\ Interstate telephone service providers must compute 
their annual regulatory fee based on their interstate and international 
end-user revenue using information they already supply to the 
Commission in compliance with the Form 499-A, Telecommunications 
Reporting Worksheet, and they must complete and submit the FCC Form 
159. Compliance with the fee schedule will require some licensees to 
tabulate the number of units (e.g., cellular telephones, pagers, cable 
TV subscribers) they have in service, and complete and submit an FCC 
Form 159. Licensees ordinarily will keep a list of the number of units 
they have in service as part of their normal business practices. No 
additional outside professional skills are required to complete the FCC 
Form 159, and it can be completed by the employees responsible for an 
entity's business records.
---------------------------------------------------------------------------

    \262\ The following categories are exempt from the Commission's 
Schedule of Regulatory Fees: Amateur radio licensees (except 
applicants for vanity call signs) and operators in other non-
licensed services (e.g., Personal Radio, part 15, ship and 
aircraft). Governments and non-profit (exempt under section 501(c) 
of the Internal Revenue Code) entities are exempt from payment of 
regulatory fees and need not submit payment. Non-commercial 
educational broadcast licensees are exempt from regulatory fees as 
are licensees of auxiliary broadcast services such as low power 
auxiliary stations, television auxiliary service stations, remote 
pickup stations and aural broadcast auxiliary stations where such 
licenses are used in conjunction with commonly owned non-commercial 
educational stations. Emergency Alert System licenses for auxiliary 
service facilities are also exempt as are instructional television 
fixed service licensees. Regulatory fees are automatically waived 
for the licensee of any translator station that: (1) Is not licensed 
to, in whole or in part, and does not have common ownership with, 
the licensee of a commercial broadcast station; (2) does not derive 
income from advertising; and (3) is dependent on subscriptions or 
contributions from members of the community served for support. 
Receive only earth station permittees are exempt from payment of 
regulatory fees. A regulatee will be relieved of its fee payment 
requirement if its total fee due, including all categories of fees 
for which payment is due by the entity, amounts to less than $10.
---------------------------------------------------------------------------

    128. Each licensee must submit the FCC Form 159 to the Commission's 
lockbox bank after computing the number of units subject to the fee. 
Licensees may also file electronically to minimize the burden of 
submitting multiple copies of the FCC Form 159. Applicants who pay 
small fees in advance and provide fee information as part of their 
application must use FCC Form 159.
    129. Licensees and regulatees are advised that failure to submit 
the required regulatory fee in a timely manner will subject the 
licensee or regulatee to a late payment penalty of 25 percent in 
addition to the required fee.\263\ If payment is not received, new or 
pending applications may be dismissed, and existing authorizations may 
be subject to rescission.\264\ Further, in accordance with the Debt 
Collection Improvement Act of 1996, federal agencies may bar a person 
or entity from obtaining a Federal loan or loan insurance guarantee if 
that person or entity fails to pay a delinquent debt owed to any 
federal agency.\265\ Nonpayment of regulatory fees is a debt owed the 
United States pursuant to 31 U.S.C. 3711 et seq., and the Debt 
Collection Improvement Act of 1996, Public Law 194-134. Appropriate 
enforcement measures as well as administrative and judicial remedies, 
may be exercised by the Commission. Debts owed to the Commission may 
result in a person or entity being denied a federal loan or loan 
guarantee pending before another federal agency until such obligations 
are paid.\266\
---------------------------------------------------------------------------

    \263\ 47 CFR 1.1164.
    \264\ 47 CFR 1.1164(c).
    \265\ Public Law 104-134, 110 Stat. 1321 (1996).
    \266\ 31 U.S.C. 7701(c)(2)(B).
---------------------------------------------------------------------------

    130. The Commission's rules currently provide for relief in 
exceptional circumstances. Persons or entities may request a waiver, 
reduction or deferment of payment of the regulatory fee.\267\ However, 
timely submission of the required regulatory fee must accompany 
requests for waivers or reductions. This will avoid any late payment 
penalty if the request is denied. The fee will be refunded if the 
request is granted. In exceptional and compelling instances (where 
payment of the regulatory fee along with the waiver or reduction 
request could result in reduction of service to a community or other 
financial hardship to the licensee), the Commission will defer payment 
in response to a request filed with the appropriate supporting 
documentation.
---------------------------------------------------------------------------

    \267\ 47 CFR 1.1166.
---------------------------------------------------------------------------

V. Steps Taken to Minimize Significant Economic Impact on Small 
Entities, and Significant Alternatives Considered

    131. 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: (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. As described in Section III of this FRFA, supra, we have 
created procedures in which all fee-filing licensees and regulatees use 
a single form, FCC Form 159, and have described in plain language the 
general filing requirements. We have sought comment on other 
alternatives that might simplify our fee procedures or otherwise 
benefit small entities, while remaining consistent with our statutory 
responsibilities in this proceeding.
    132. The Omnibus Appropriations Act for FY 2005, Public Law 108-
447, requires the Commission to revise its Schedule of Regulatory Fees 
in order to recover the amount of regulatory fees that Congress, 
pursuant to section 9(a) of the Communications Act, as amended, has 
required the Commission to collect for Fiscal Year (FY) 2005.\268\ As 
noted, we sought comment on the proposed methodology for implementing 
these statutory requirements and any other potential impact of these 
proposals on small entities.
---------------------------------------------------------------------------

    \268\ 47 U.S.C. 159(a).
---------------------------------------------------------------------------

    133. We have previously used cost accounting data for computation 
of regulatory fees, but found that some fees which were very small in 
previous years would have increased dramatically and would have a 
disproportionate impact

[[Page 41988]]

on smaller entities. The methodology we are using in this Report and 
Order minimizes this impact by limiting the amount of increase and 
shifting costs to other services which, for the most part, are larger 
entities.
    134. Several categories of licensees and regulatees are exempt from 
payment of regulatory fees. See, e.g., footnote 261, supra.
    135. Report to Small Business Administration: The Commission will 
send a copy of this Report and Order, including a copy of the FRFA to 
the Chief Counsel for Advocacy of the Small Business Administration. 
The Report and Order and FRFA (or summaries thereof) will also be 
published in the Federal Register.
    136. Report to Congress: The Commission will send a copy of this 
Final Regulatory Flexibility Analysis (FRFA), along with this Report 
and Order, in a report to Congress pursuant to the Congressional Review 
Act, 5 U.S.C. 801(a)(1)(A).

Attachment B--Sources of Payment Unit Estimates for FY 2005

    In order to calculate individual service fees for FY 2005, we 
adjusted FY 2004 payment units for each service to more accurately 
reflect expected FY 2005 payment liabilities. We obtained our updated 
estimates through a variety of means. For example, we used Commission 
licensee data bases, actual prior year payment records and industry and 
trade association projections when available. The databases we 
consulted include the Commission's Universal Licensing System (ULS), 
International Bureau Filing System (IBFS), and Consolidated Database 
System (CDBS). The industry sources we consulted include, but are not 
limited to, Television & Cable Factbook by Warren Publishing, Inc. and 
the Broadcasting and Cable Yearbook by Reed Elsevier, Inc, as well as 
reports generated within the Commission such as the Wireline 
Competition Bureau's Trends in Telephone Service and the Wireless 
Telecommunications Bureau's Numbering Resource Utilization Forecast.
    We tried to obtain verification for these estimates from multiple 
sources and, in all cases, we compared FY 2005 estimates with actual FY 
2004 payment units to ensure that our revised estimates were 
reasonable. Where appropriate, we adjusted and/or rounded our final 
estimates to take into consideration the fact that certain variables 
that impact on the number of payment units cannot yet be estimated 
exactly. These include an unknown number of waivers and/or exemptions 
that may occur in FY 2005 and the fact that, in many services, the 
number of actual licensees or station operators fluctuates from time to 
time due to economic, technical or other reasons. Therefore, when we 
note, for example, that our estimated FY 2005 payment units are based 
on FY 2004 actual payment units, it does not necessarily mean that our 
FY 2005 projection is exactly the same number as FY 2004. It means that 
we have either rounded the FY 2005 number or adjusted it slightly to 
account for these variables.

------------------------------------------------------------------------
         Fee category              Sources of payment unit estimates
------------------------------------------------------------------------
Land Mobile (All), Microwave,  Based on Wireless Telecommunications
 218-219 MHz, Marine (Ship &    Bureau (WTB) projections of new
 Coast), Aviation (Aircraft &   applications and renewals taking into
 Ground), GMRS, Amateur         consideration existing Commission
 Vanity Call Signs, Domestic    licensee data bases. Aviation (Aircraft)
 Public Fixed.                  and Marine (Ship) estimates have been
                                adjusted to take into consideration the
                                licensing of portions of these services
                                on a voluntary basis.
CMRS Cellular/Mobile Services  Based on Wireless Telecommunications
                                Bureau estimates.
CMRS Messaging Services......  Based on Wireless Telecommunications
                                Bureau Competition Report estimates.
AM/FM Radio Stations.........  Based on estimates from Media Services
                                Bureau estimates, adjusted for
                                exemptions, and actual FY 2004 payment
                                units.
UHF/VHF Television Stations..  Based on Media Services Bureau estimates
                                and actual FY 2004 payment units.
AM/FM/TV Construction Permits  Based on Media Services Bureau estimates
                                and actual FY 2004 payment units.
LPTV, Translators and          Based on actual FY 2004 payment units.
 Boosters.
Broadcast Auxiliaries........  Based on actual FY 2004 payment units.
BRS (formerly MDS/MMDS)......  Based on Wireless Telecommunications
                                Bureau estimates and actual FY 2004
                                payment units.
Cable Television Relay         Based on actual FY 2004 payment units.
 Service (CARS) Stations.
Cable Television System        Based on Media Services Bureau industry
 Subscribers.                   estimates of subscribership, and actual
                                FY 2004 payment units.
Interstate Telecommunication   Based on actual FY 2004 interstate
 Service Providers.             revenues reported on Telecommunications
                                Reporting Worksheet, adjusted for FY
                                2005 revenue growth/decline for
                                industry, and projections by the
                                Wireline Competition Bureau.
Earth Stations...............  Based on actual FY 2004 payment estimates
                                and projected FY 2005 units.
Space Stations (GSOs & NGSOs)  Based on International Bureau licensee
                                data base estimates.
International Bearer Circuits  Based on FY 2004 actual paid units, and
                                adjusted for growth.
International HF Broadcast     Based on International Bureau estimates.
 Stations, International
 Public Fixed Radio Service.
------------------------------------------------------------------------


                                      Attachment C.--Calculation of FY 2005 Revenue Requirements and Pro-Rata Fees
 [Regulatory fees for the categories shaded in gray are collected by the Commission in advance to cover the term of the license and are submitted along
                                               with the application at the time the application is filed.]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                     Computed     Rounded
                                                                                           FY 2004    Pro-rated FY    new FY      new FY
                         Fee category                          FY 2005  payment  Years     revenue    2005 revenue     2005        2005      Expected FY
                                                                     units                estimate     requirement  regulatory  regulatory  2005 revenue
                                                                                                            *           fee         fee
--------------------------------------------------------------------------------------------------------------------------------------------------------
PLMRS (Exclusive use)........................................             3,700     10       340,000       349,068           9          10       370,000
PLMRS (Shared use)...........................................            46,000     10     2,300,000     2,361,342           5           5     2,300,000
Microwave....................................................             2,600     10     1,500,000     1,540,006          59          60     1,560,000
218-219 MHz (Formerly IVDS)..................................                 3     10         1,500         1,540          51          50         1,500
Marine (Ship)................................................             7,000     10       585,000       600,602           9          10       700,000

[[Page 41989]]

 
GMRS.........................................................            21,000      5       375,000       385,001           4           5       525,000
Aviation (Aircraft)..........................................             7,400     10       155,000       159,134           2           5       370,000
Marine (Coast)...............................................             1,000     10        96,200        98,766          10          10       100,000
Aviation (Ground)............................................             1,600      5       120,000       123,200          15          15       120,000
Amateur Vanity Call Signs....................................             7,600     10       162,119       166,443        2.19        2.19       166,443
AM Class A...................................................                66      1       198,375       203,666       3,086       3,075       202,950
AM Class B...................................................             1,592      1     2,421,075     2,485,646       1,561       1,550     2,467,600
AM Class C...................................................               956      1       841,500       863,943         904         900       860,400
AM Class D...................................................             1,769      1     2,784,800     2,859,072       1,616       1,625     2,874,625
FM Classes A, B1 & C3........................................             3,045      1     5,715,500     5,980,390       1,964       1,975     6,013,875
FM Classes B, C, C0, C1 & C2.................................             2,963      1     7,026,150     7,321,585       2,471       2,475     7,333,425
AM Construction Permits......................................               113      1        33,945        34,850         308         310        35,030
FM Construction Permits \1\..................................                98      1       267,300        53,929         550         550        53,900
Satellite TV.................................................               123      1       128,100       131,516       1,069       1,075       132,225
Satellite TV Construction Permit.............................                 3      1         1,560         1,602         534         535         1,605
VHF Markets 1-10.............................................                43      1     2,596,125     2,665,365      61,985      61,975     2,664,925
VHF Markets 11-25............................................                61      1     2,654,400     2,725,194      44,675      44,675     2,725,175
VHF Markets 26-50............................................                72      1     2,246,475     2,306,389      32,033      32,025     2,305,800
VHF Markets 51-100...........................................               118      1     2,161,725     2,219,379      18,808      18,800     2,218,400
VHF Remaining Markets........................................               211      1       951,750       977,134       4,631       4,625       975,875
UHF Construction Permits.....................................                 9      1        27,900        28,644       3,183       3,175        28,575
UHF Markets 1-10.............................................                84      1     1,599,750     1,682,187      20,026      20,025     1,682,100
UHF Markets 11-25............................................                79      1     1,310,175     1,384,889      17,530      17,525     1,384,475
UHF Markets 26-50............................................               115      1     1,088,100     1,156,891      10,060      10,050     1,155,750
UHF Markets 51-100...........................................               162      1       943,500       993,971       6,136       6,125       992,250
UHF Remaining Markets........................................               181      1       301,950       310,003       1,713       1,725       312,225
UHF Construction Permits \1\.................................                31      1       192,950        53,475       1,725       1,725        53,475
Broadcast Auxiliaries........................................            25,000      1       250,000       256,668          10          10       250,000
LPTV/Translators/Boosters....................................             2,900      1     1,116,500     1,146,277         395         395     1,145,500
CARS Stations................................................               900      1       135,000       138,001         154         154       139,500
Cable TV Systems.............................................        65,000,000      1    45,500,000    46,713,502       0.719        0.72    46,800,000
Interstate Telecommunication Service Providers...............    54,000,000,000      1   127,530,000   130,931,273    0.002425     0.00243   131,220,000
CMRS Mobile Services (Cellular/Public Mobile)................       179,000,000      1    38,250,000    39,565,080       0.221        0.22    39,380,000
CMRS Messaging Services......................................        11,200,000      1     1,160,000       896,000        0.08        0.08       896,000
BRS \2\......................................................             1,800      1       432,000       455,400         253         255       459,000
LMDS \3\.....................................................               330      1        91,800        83,490         253         255        84,150
International Bearer Circuits................................         5,300,000      1     7,056,000     7,244,186        1.37        1.37     7,261,000
International Public Fixed...................................                 1      1         1,750         1,797       1,797       1,800         1,800
Earth Stations...............................................             3,400      1       680,000       698,136         205         205       697,000
International HF Broadcast...................................                 5      1         3,725         3,824         765         765         3,825
Space Stations (Geostationary)...............................                81      1     8,829,975     9,065,474     111,919     111,925     9,065,925
Space Stations (Non-Geostationary............................                 6      1       657,000       674,522     112,420     112,425       674,550
                                                              -------------------
    Total Estimated Revenue to be Collected..................  ................  .....   272,821,674   280,099,050  ..........  ..........   280,765,853
                                                              ===================
    Total Revenue Requirement................................  ................  .....   272,958,000   280,098,000  ..........  ..........   280,098,000
                                                              ===================
Difference...................................................  ................  .....     (136,326)         1,050  ..........  ..........      667,853
--------------------------------------------------------------------------------------------------------------------------------------------------------
*1,02615787 factor applied based on the amount Congress designated for recovery through regulatory fees (Public Law 108-7 and 47 U.S.C. 159(a)(2)).
\1\ The FM Construction Permit and UHF Construction Permit revenues were adjusted so that the construction permit fee is no higher than the level of the
  lowest licensed fee for that class of service.
\2\ MDS/MMDS category was renamed Broadband Radio Service (BRS). See Amendment of Parts 1, 21, 73, 74 and 101 of the Commission's Rules to Facilitate
  the Provision of Fixed and Mobile Broadband Access, Educational and Other Advanced Services in the 2150-2162 and 2500-2690 MHz Bands et al., Report &
  Order and Further Notice of Proposed Rulemaking, 19 FCC Rcd 14165 (2004).
\3\ Although we are tracking BRS (formerly MDS/MMDS) and LMDS separately in terms of payment units, the FY 2005 regulatory fee for BRS and LMDS is
  calculated by combining the units and the ``Pro-Rated Revenue Requirements'' of both BRS and LMDS.


[[Page 41990]]


           Attachment D.--FY 2005 Schedule of Regulatory Fees
 [Regulatory fees for the categories shaded in gray are collected by the
Commission in advance to cover the term of the license and are submitted
    along with the application at the time the application is filed]
------------------------------------------------------------------------
                                                              Annual
                      Fee category                        regulatory fee
                                                            (U.S. $'s)
------------------------------------------------------------------------
PLMRS (per license) (Exclusive Use) (47 CFR part 90)...               10
Microwave (per license) (47 CFR part 101)..............               60
218-219 MHz (Formerly Interactive Video Data Service)                 50
 (per license) (47 CFR part 95)........................
Marine (Ship) (per station) (47 CFR part 80)...........               10
Marine (Coast) (per license) (47 CFR part 80)..........               10
General Mobile Radio Service (per license) (47 CFR part                5
 95)...................................................
Rural Radio (47 CFR part 22) (previously listed under                  5
 the Land Mobile category).............................
PLMRS (Shared Use) (per license) (47 CFR part 90)......                5
Aviation (Aircraft) (per station) (47 CFR part 87).....                5
Aviation (Ground) (per license) (47 CFR part 87).......               15
Amateur Vanity Call Signs (per call sign) (47 CFR part              2.19
 97)...................................................
CMRS Mobile/Cellular Services (per unit) (47 CFR parts               .22
 20, 22, 24, 27, 80 and 90)............................
CMRS Messaging Services (per unit) (47 CFR parts 20,                 .08
 22, 24 and 90)........................................
Broadband Radio Service (formerly MMDS/ MDS) (per                    255
 license) (47 CFR part 21).............................
Local Multipoint Distribution Service (47 CFR, part                  255
 101)..................................................
AM Radio Construction Permits..........................              310
FM Radio Construction Permits..........................              550
TV (47 CFR part 73) VHF Commercial:
    Markets 1-10.......................................           61,975
    Markets 11-25......................................           44,675
    Markets 26-50......................................           32,025
    Markets 51-100.....................................           18,800
    Remaining Markets..................................            4,625
    Construction Permits...............................            3,175
TV (47 CFR part 73) UHF Commercial:
    Markets 1-10.......................................           20,025
    Markets 11-25......................................           17,525
    Markets 26-50......................................           10,050
    Markets 51-100.....................................            6,125
    Remaining Markets..................................            1,725
    Construction Permits...............................            1,725
Satellite Television Stations (All Markets)............            1,075
Construction Permits--Satellite Television Stations....              535
Low Power TV, TV/FM Translators & Boosters (47 CFR part              395
 74)...................................................
Broadcast Auxiliaries (47 CFR part 74).................               10
CARS (47 CFR part 78)..................................              155
Cable Television Systems (per subscriber) (47 CFR part               .72
 76)...................................................
Interstate Telecommunication Service Providers (per               .00243
 revenue dollar).......................................
Earth Stations (47 CFR part 25)........................              205
Space Stations (per operational station in                       111,925
 geostationary orbit) (47 CFR part 25) also includes
 DBS Service (per operational station) (47 CFR part
 100)..................................................
Space Stations (per operational system in non-                   112,425
 geostationary orbit) (47 CFR part 25).................
International Bearer Circuits (per active 64KB circuit)             1.37
International Public Fixed (per call sign) (47 CFR part            1,800
 23)...................................................
International (HF) Broadcast (47 CFR part 73)..........              765
------------------------------------------------------------------------


                                 FY 2005 Schedule of Regulatory Fees (continued)
----------------------------------------------------------------------------------------------------------------
                                      FY 2005 radio station regulatory fees
-----------------------------------------------------------------------------------------------------------------
                                                                                       FM  classes   FM  classes
      Population served        AM class A    AM class B    AM class C    AM class D    A,  B1 and    B,  C, C0,
                                                                                           C3         C1 and C2
----------------------------------------------------------------------------------------------------------------
<=25,000....................           625           475           375           450           550           725
25,001-75,000...............         1,225           925           550           675         1,125         1,250
75,001-150,000..............         1,825         1,150           750         1,125         1,550         2,300
150,001-500,000.............         2,750         1,950         1,125         1,350         2,375         3,000
500,001-1,200,000...........         3,950         2,975         1,875         2,250         3,750         4,400
1,200,001-3,000,00..........         6,075         4,575         2,825         3,600         6,100         7,025
>3,000,000..................         7,275         5,475         3,575         4,500         7,750         9,125
----------------------------------------------------------------------------------------------------------------


[[Page 41991]]

Attachment E--Factors, Measurements and Calculations That Go Into 
Determining Station Signal Contours and Associated Population Coverages

AM Stations

    For stations with nondirectional daytime antennas, the theoretical 
radiation was used at all azimuths. For stations with directional 
daytime antennas, specific information on each day tower, including 
field ratio, phasing, spacing and orientation was retrieved, as well as 
the theoretical pattern root-mean-square of the radiation in all 
directions in the horizontal plane (RMS) figure milliVolt per meter 
(mV/m) @ 1 km) for the antenna system. The standard, or modified 
standard if pertinent, horizontal plane radiation pattern was 
calculated using techniques and methods specified in sections 73.150 
and 73.152 of the Commission's rules.\269\ Radiation values were 
calculated for each of 360 radials around the transmitter site. Next, 
estimated soil conductivity data was retrieved from a database 
representing the information in FCC Figure R3 \270\. Using the 
calculated horizontal radiation values, and the retrieved soil 
conductivity data, the distance to the city grade (5 mV/m) contour was 
predicted for each of the 360 radials. The resulting distance to city 
grade contours were used to form a geographical polygon. Population 
counting was accomplished by determining which 2000 block centroids 
were contained in the polygon. (A block centroid is the center point of 
a small area containing population as computed by the U.S. Census 
Bureau.) The sum of the population figures for all enclosed blocks 
represents the total population for the predicted city grade coverage 
area.
---------------------------------------------------------------------------

    \269\ 47 CFR 73.150 and 73.152.
    \270\ See Map of Estimated Effective Ground Conductivity in the 
United States, 47 CFR 73.190 Figure R3.
---------------------------------------------------------------------------

FM Stations

    The greater of the horizontal or vertical effective radiated power 
(ERP) (kW) and respective height above average terrain (HAAT) (m) 
combination was used. Where the antenna height above mean sea level 
(HAMSL) was available, it was used in lieu of the average HAAT figure 
to calculate specific HAAT figures for each of 360 radials under study. 
Any available directional pattern information was applied as well, to 
produce a radial-specific ERP figure. The HAAT and ERP figures were 
used in conjunction with the Field Strength (50-50) propagation curves 
specified in 47 CFR section 73.313 of the Commission's rules to predict 
the distance to the city grade (70 dBu (decibel above 1 microVolt per 
meter) or 3.17 mV/m) contour for each of the 360 radials.\271\ The 
resulting distance to city grade contours were used to form a 
geographical polygon. Population counting was accomplished by 
determining which 2000 block centroids were contained in the polygon. 
The sum of the population figures for all enclosed blocks represents 
the total population for the predicted city grade coverage area.
---------------------------------------------------------------------------

    \271\ 47 CFR 73.313.
---------------------------------------------------------------------------

Attachment F

Parties Filing Comments on the Notice of Proposed Rulemaking

    Blooston, Mordkofsky, Dickens, Duffy & Prendergast (``BMDDP'').
    Cingular Wireless LLC (``Cingular'').
    National Cable & Telecommunications Association (``NCTA'').
    Satellite Industry Association (``SIA'').
    Tyco Communications (US) Inc. (``Tyco'').
    XO Communications, Inc. (``XO'').

Parties Filing Reply Comments

    American Cable Association (``ACA'').
    Cellular Telecommunications and Internet Association (``CTIA'').
    DIRECTV, Inc. and EchoStar Satellite (``DirecTV & Echostar'').
    Level 3 Communications (``Level 3'').
    Tyco Communications (US) Inc. (``Tyco'').

Parties Filing a Notice of Oral Ex Parte Presentation

    Tyco Telecommunications (``Tyco Telecom''), filed by Harris, 
Wiltshire & Grannis, LLP.
    Satellite company representatives from Intelsat, PanAmSat, and SES 
Americom, Filed by Hogan & Hartson, LLP.
    XO Communications (``XO''), Filed by Mintz, Levin, Cohn, Ferris, 
Glovsky, and Popeo, PC.

           Attachment G.--FY 2004 Schedule of Regulatory Fees
------------------------------------------------------------------------
                                                              Annual
                      Fee category                        regulatory fee
                                                            (U.S. $'s)
------------------------------------------------------------------------
PLMRS (per license) (Exclusive Use) (47 CFR part 90)...               10
Microwave (per license) (47 CFR part 101)..............               50
218-219 MHz (Formerly Interactive Video Data Service)                 50
 (per license) (47 CFR part 95)........................
Marine (Ship) (per station) (47 CFR part 80)...........               15
Marine (Coast) (per license) (47 CFR part 80)..........               10
General Mobile Radio Service (per license) (47 CFR part                5
 95)...................................................
Rural Radio (47 CFR part 22) (previously listed under                  5
 the Land Mobile category).............................
PLMRS (Shared Use) (per license) (47 CFR part 90)......                5
Aviation (Aircraft) (per station) (47 CFR part 87).....                5
Aviation (Ground) (per license) (47 CFR part 87).......               15
Amateur Vanity Call Signs (per call sign) (47 CFR part              2.08
 97)...................................................
CMRS Mobile/Cellular Services (per unit) (47 CFR parts               .25
 20, 22, 24, 27, 80 and 90)............................
CMRS Messaging Services (per unit) (47 CFR parts 20,                 .08
 22, 24 and 90)........................................
Multipoint Distribution Services (MMDS/ MDS) (per call               270
 sign) (47 CFR part 21)................................
Local Multipoint Distribution Service (per call sign)                270
 (47 CFR, part 101)....................................
AM Radio Construction Permits..........................              465
FM Radio Construction Permits..........................            1,650
TV (47 CFR part 73) VHF Commercial:
    Markets 1-10.......................................           60,375
    Markets 11-25......................................           41,475
    Markets 26-50......................................           29,175
    Markets 51-100.....................................           17,575

[[Page 41992]]

 
    Remaining Markets..................................            4,050
    Construction Permits                                           4,650
TV (47 CFR part 73) UHF Commercial:
    Markets 1-10.......................................           17,775
    Markets 11-25......................................           16,175
    Markets 26-50......................................            9,300
    Markets 51-100.....................................            5,550
    Remaining Markets..................................            1,650
    Construction Permits...............................            5,675
Satellite Television Stations (All Markets)............            1,050
Construction Permits--Satellite Television Stations....              520
Low Power TV, TV/FM Translators & Boosters (47 CFR part              385
 74)...................................................
Broadcast Auxiliary (47 CFR part 74)...................               10
CARS (47 CFR part 78)..................................              135
Cable Television Systems (per subscriber) (47 CFR part               .70
 76)...................................................
Interstate Telecommunication Service Providers (per               .00218
 revenue dollar).......................................
Earth Stations (47 CFR part 25)........................              200
Space Stations (per operational station in                       114,675
 geostationary orbit) (47 CFR part 25) also includes
 Direct Broadcast Satellite Service (per operational
 station) (47 CFR part 100)............................
Space Stations (per operational system in non-                   131,400
 geostationary orbit) (47 CFR part 25).................
International Bearer Circuits (per active 64KB circuit)             2.52
International Public Fixed (per call sign) (47 CFR part            1,750
 23)...................................................
International (HF) Broadcast (47 CFR part 73)..........              745
------------------------------------------------------------------------


                                 FY 2004 Schedule of Regulatory Fees (continued)
----------------------------------------------------------------------------------------------------------------
                                      FY 2004 Radio station regulatory fees
-----------------------------------------------------------------------------------------------------------------
                                                                                                     FM classes
      Population served        AM class A    AM class B    AM class C    AM class D    FM classes   B, C, C0, C1
                                                                                       A, B1 & C3       & C2
----------------------------------------------------------------------------------------------------------------
<-25,000....................           600           450           350           425           525           675
25,001-75,000...............         1,200           900           525           625         1,050         1,175
75,001-150,000..............         1,800         1,125           700         1,075         1,450         2,200
150,001-500,000.............         2,700         1,925         1,050         1,275         2,225         2,875
500,001-1,200,000...........         3,900         2,925         1,750         2,125         3,550         4,225
1,200,001-3,000,00..........         6,000         4,500         2,625         3,400         5,775         6,750
>3,000,000..................         7,200         5,400         3,325         4,250         7,350         8,775
----------------------------------------------------------------------------------------------------------------

Statement of Commissioner Michael Copps, Concurring; Re: Assessment and 
Collection of Regulatory Fees for Fiscal Year 2005

    As in past years, I concur to emphasize that the Commission should 
consider initiating a proceeding to address when or how it would adjust 
the regulatory fees pursuant to section 9(b)(3) of the Act. As 
technology advances and our regulatory activities change, we must 
continue to look for ways to improve our regulatory fee methodology to 
ensure that we continue to comply fully with the Act's requirements.

Statement of Commissioner Jonathan Adelstein Approving in Part, 
Concurring in Part; Re: Assessment and Collection of Regulatory Fees 
for Fiscal Year 2005; MD Docket No. 05-59

    As in years past, I must concur to portions of our Regulatory Fee 
Order because I remain troubled with the Commission's inability to 
consider changes that undoubtedly occur from time to time in the costs 
of regulatory fees for individual services. I encourage the Commission 
to continue to improve its regulatory fee assessment processes so that 
in the future we are more able to make these adjustments as 
appropriate.

List of Subjects in 47 CFR Part 1

    Administrative practice and procedure.

0
For the reasons discussed in the preamble, the Federal Communications 
Commission amends 47 CFR part 1 as follows:

PART 1--PRACTICE AND PROCEDURE

0
1. The authority citation for part 1 continues to read as follows:

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

0
2. Section 1.1152 is revised to read as follows:


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

[[Page 41993]]



------------------------------------------------------------------------
   Exclusive use services (per     Fee amount
            license)                   \1\               Address
------------------------------------------------------------------------
1. Land Mobile (Above 470 MHz
 and 220 MHz Local, Base Station
 & SMRS) (47 CFR part 90):
    (a) New, Renew/Mod (FCC 601         $10.00  FCC, P.O. Box 358130,
     & 159).                                     Pittsburgh, PA 15251-
                                                 5130.
    (b) New, Renew/Mod                   10.00  FCC, P.O. Box 358994,
     (Electronic Filing) (FCC                    Pittsburgh, PA 15251-
     601 & 159).                                 5994.
    (c) Renewal Only (FCC 601 &          10.00  FCC, P.O. Box 358245,
     159).                                       Pittsburgh, PA 15251-
                                                 5245.
    (d) Renewal Only (Electronic         10.00  FCC, P.O. Box 358994,
     Filing) (FCC 601 & 159).                    Pittsburgh, PA 15251-
                                                 5994.
220 MHz Nationwide:
    (a) New, Renew/Mod (FCC 601          10.00  FCC, P.O. Box 358130,
     & 159).                                     Pittsburgh, PA 15251-
                                                 5130.
    (b) New, Renew/Mod                   10.00  FCC, P.O. Box 358994,
     (Electronic Filing) (FCC                    Pittsburgh, PA 15251-
     601 & 159).                                 5994.
    (c) Renewal Only (FCC 601 &          10.00  FCC, P.O. Box 358245,
     159).                                       Pittsburgh, PA 15251-
                                                 5245.
    (d) Renewal Only (Electronic         10.00  FCC, P.O. Box 358994,
     Filing) (FCC 601 & 159).                    Pittsburgh, PA 15251-
                                                 5994.
2. Microwave (47 CFR 101)
 (Private):
    (a) New, Renew/Mod (FCC 601          60.00  FCC, P.O. Box 358130,
     & 159).                                     Pittsburgh, PA 15251-
                                                 5130.
    (b) New, Renew/Mod                   60.00  FCC, P.O. Box 358994,
     (Electronic Filing) (FCC                    Pittsburgh, PA 15251-
     601 & 159).                                 5994.
    (c) Renewal Only (FCC 601 &          60.00  FCC, P.O. Box 358245,
     159).                                       Pittsburgh, PA 15251-
                                                 5245.
    (d) Renewal Only (Electronic         60.00  FCC, P.O. Box 358994,
     Filing) (FCC 601 & 159).                    Pittsburgh, PA 15251-
                                                 5994.
3. 218-219 MHz Service:
    (a) New, Renew/Mod (FCC 601          50.00  FCC, P.O. Box 358130,
     & 159).                                     Pittsburgh, PA 15251-
                                                 5130.
    (b) New, Renew/Mod                   50.00  FCC, P.O. Box 358994,
     (Electronic Filing) (FCC                    Pittsburgh, PA 15251-
     601 & 159).                                 5994.
    (c) Renewal Only (FCC 601 &          50.00  FCC, P.O. Box 358245,
     159).                                       Pittsburgh, PA 15251-
                                                 5245.
    (d) Renewal Only (Electronic         50.00  FCC, P.O. Box 358994,
     Filing) (FCC 601 & 159).                    Pittsburgh, PA 15251-
                                                 5994.
4. Shared Use Services, Land
 Mobile (Frequencies Below 470
 MHz--except 220 MHz):
    (a) New, Renew/Mod (FCC 601           5.00  FCC, P.O. Box 358130,
     & 159).                                     Pittsburgh, PA 15251-
                                                 5130.
    (b) New, Renew/Mod                    5.00  FCC, P.O. Box 358994,
     (Electronic Filing) (FCC                    Pittsburgh, PA 15251-
     601 & 159).                                 5994.
    (c) Renewal Only (FCC 601 &           5.00  FCC, P.O. Box 358245,
     159).                                       Pittsburgh, PA 15251-
                                                 5245.
    (d) Renewal Only (Electronic          5.00  FCC, P.O. Box 358994,
     Filing) (FCC 601 & 159).                    Pittsburgh, PA 15251-
                                                 5994.
General Mobile Radio Service:
    (a) New, Renew/Mod (FCC 605           5.00  FCC, P.O. Box 358130,
     & 159).                                     Pittsburgh, PA 15251-
                                                 5130.
    (b) New, Renew/Mod                    5.00  FCC, P.O. Box 358994,
     (Electronic Filing) (FCC                    Pittsburgh, PA 15251-
     605 & 159).                                 5994.
    (c) Renewal Only (FCC 605 &           5.00  FCC, P.O. Box 358245,
     159).                                       Pittsburgh, PA 15251-
                                                 5245.
    (d) Renewal Only (Electronic          5.00  FCC, P.O. Box 358994,
     Filing) (FCC 605 & 159).                    Pittsburgh, PA 15251-
                                                 5994.
Rural Radio (Part 22):
    (a) New, Additional                   5.00  FCC, P.O. Box 358994,
     Facility, Major Renew/Mod                   Pittsburgh, PA 15251-
     (Electronic Filing) (FCC                    5994.
     601 & 159).
    (b) Renewal, Minor Renew/Mod          5.00  FCC, P.O. Box 358994,
     (Electronic Filing) (FCC                    Pittsburgh, PA 15251-
     601 & 159).                                 5994.
Marine Coast:
    (a) New Renewal/Mod (FCC 601         10.00  FCC, P.O. Box 358130,
     & 159).                                     Pittsburgh, PA 15251-
                                                 5130.
    (b) Renewal Only (FCC 601 &          10.00  FCC, P.O. Box 358245,
     159).                                       Pittsburgh, PA 15251-
                                                 5245.
    (c) Renewal Only (Electronic         10.00  FCC, P.O. Box 358994,
     Filing) (FCC 601 & 159).                    Pittsburgh, PA 15251-
                                                 5994.
Aviation Ground:
    (a) New, Renewal/Mod (FCC            15.00  FCC, P.O. Box 358130,
     601 & 159).                                 Pittsburgh, PA 15251-
                                                 5130.
    (b) Renewal Only (FCC 601 &          15.00  FCC, P.O. Box 358245,
     159).                                       Pittsburgh, PA 15251-
                                                 5245.
    (c) Renewal Only (Electronic         15.00  FCC, P.O. Box 358994,
     Filing) (FCC 601 & 159).                    Pittsburgh, PA 15251-
                                                 5994.
Marine Ship:
    (a) New, Renewal/Mod (FCC            10.00  FCC, P.O. Box 358130,
     605 & 159).                                 Pittsburgh, PA 15251-
                                                 5130.
    (b) New, Renewal/Mod                 10.00  FCC, P.O. Box 358994,
     (Electronic Filing) (FCC                    Pittsburgh, PA 15251-
     605 & 159).                                 5994.
    (c) Renewal Only (FCC 605 &          10.00  FCC, P.O. Box 358245,
     159).                                       Pittsburgh, PA 15251-
                                                 5245.
    (d) Renewal Only (Electronic         10.00  FCC, P.O. Box 358994,
     Filing) (FCC 605 & 159).                    Pittsburgh, PA 15251-
                                                 5994.
Aviation Aircraft:
    (a) New, Renew/Mod (FCC 605           5.00  FCC, P.O. Box 358130,
     & 159).                                     Pittsburgh, PA 15251-
                                                 5130.
    (b) New, Renew/Mod                    5.00  FCC, P.O. Box 358994,
     (Electronic Filing) (FCC                    Pittsburgh, PA 15251-
     605 & 159).                                 5994.
    (c) Renewal Only (FCC 605 &           5.00  FCC, P.O. Box 358245,
     159).                                       Pittsburgh, PA 15251-
                                                 5245.
    (d) Renewal Only (Electronic          5.00  FCC, P.O. Box 358994,
     Filing) (FCC 605 & 159).                    Pittsburgh, PA 15251-
                                                 5994.
5. Amateur Vanity Call Signs
    (a) Initial or Renew (FCC             2.19  FCC, P.O. Box 358130,
     605 & 159).                                 Pittsburgh, PA 15251-
                                                 5130.
    (b) Initial or Renew                  2.19  FCC, P.O. Box 358994,
     (Electronic Filing) (FCC                    Pittsburgh, PA 15251-
     605 & 159).                                 5994.
    6. CMRS Mobile Services (per     \2\ .22 &  FCC, P.O. Box 358835,
     unit) (FCC 159).                            Pittsburgh, PA 15251-
                                                 5835.
    7. CMRS Messaging Services         \3\ .08  FCC, P.O. Box 358835,
     (per unit) (FCC 159).                       Pittsburgh, PA 15251-
                                                 5835.
    8. Multipoint Distribution             255  FCC, Multipoint, P.O.
     (Includes MMDS and MDS).                    Box 358835, Pittsburgh,
                                                 PA 15251-5835.
    9. Local Multipoint                    255  FCC, Multipoint, P.O.
     Distribution Service.                       Box 358835, Pittsburgh,
                                                 PA 15251-5835.
------------------------------------------------------------------------
\1\ Note that ``small fees'' are collected in advance for the entire
  license term. Therefore, the annual fee amount shown in this table
  that is a small fee (categories 1 through 5) must be multiplied by the
  5- or 10-year license term, as appropriate, to arrive at the total
  amount of regulatory fees owed. It should be further noted that
  application fees may also apply as detailed in Sec.   1.1102.
\2\ These are standard fees that are to be paid in accordance with Sec.
   1.1157(b).
\3\ These are standard fees that are to be paid in accordance with Sec.
   1.1157(b).


[[Page 41994]]


0
3. Section 1.1153 is revised to read as follows:


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

------------------------------------------------------------------------
 Radio [AM and FM] (47 CFR part
               73)                 Fee amount            Address
------------------------------------------------------------------------
1. AM Class A
    <=25,000 population.........          $625  FCC, Radio, P.O. Box
                                                 358835, Pittsburgh, PA
                                                 15251-5835.
    25,001-75,000 population....         1,225  ........................
    75,001-150,000 population...         1,825  ........................
    150,001-500,000 population..         2,750  ........................
    500,001-1,200,000 population         3,950  ........................
    1,200,001-3,000,000                  6,075  ........................
     population.
    >3,000,000 population.......         7,275  ........................
2. AM Class B
    <=25,000 population.........           475  ........................
    25,001-75,000 population....           925  ........................
    75,001-150,000 population...         1,150  ........................
    150,001-500,000 population..         1,950  ........................
    500,001-1,200,000 population         2,975  ........................
    1,200,001-3,000,000                  4,575  ........................
     population.
    >3,000,000 population.......         5,475  ........................
3. AM Class C
    >25,000 population..........           375  ........................
    25,001-75,000 population....           550  ........................
    75,001-150,000 population...           750  ........................
    150,001-500,000 population..         1,125  ........................
    500,001-1,200,000 population         1,875  ........................
    1,200,001-3,000,000                  2,825  ........................
     population.
    >3,000,000 population.......         3,575  ........................
4. AM Class D
    <=25,000 population.........           450  ........................
    25,001-75,000 population....           675  ........................
    75,001-150,000 population...         1,125  ........................
    150,001-500,000 population..         1,350  ........................
    500,001-1,200,000 population         2,250  ........................
    1,200,001-3,000,000                  3,600  ........................
     population.
    >3,000,000 population.......         4,500  ........................
5. AM Construction Permit.......           310  ........................
6. FM Classes A, B1 and C3
    <=25,000 population.........           550  ........................
    25,001-75,000 population....         1,125  ........................
    75,001-150,000 population...         1,550  ........................
    150,001-500,000 population..         2,375  ........................
    500,001-1,200,000 population         3,750  ........................
    1,200,001-3,000,000                  6,100  ........................
     population.
    >3,000,000 population.......         7,750  ........................
7. FM Classes B, C, C0, C1 and
 C2
    <=25,000 population.........           725  ........................
    25,001-75,000 population....         1,250  ........................
    75,001-150,000 population...         2,300  ........................
    150,001-500,000 population..         3,000  ........................
    500,001-1,200,000 population         4,400  ........................
    1,200,001-3,000,000                  7,025  ........................
     population.
    >3,000,000 population.......         9,125  ........................
8. FM Construction Permits......           550  ........................
TV (47 CFR part 73), VHF
 Commercial:
    1. Markets 1 thru 10........        61,975  FCC, TV Branch, P.O. Box
                                                 358835, Pittsburgh, PA
                                                 15251-5835.
    2. Markets 11 thru 25.......        44,675
    3. Markets 26 thru 50.......        32,025  ........................
    4. Markets 51 thru 100......        18,800  ........................
    5. Remaining Markets........         4,625  ........................
    6. Construction Permits.....         3,175  ........................
UHF Commercial:
    1. Markets 1 thru 10........        20,025  FCC, UHFCommercial, P.O.
                                                 Box 358835, Pittsburgh,
                                                 PA 15251-5835.
    2. Markets 11 thru 25.......        17,525  ........................
    3. Markets 26 thru 50.......        10,050  ........................
    4. Markets 51 thru 100......         6,125  ........................
    5. Remaining Markets........         1,725  ........................
    6. Construction Permits.....         1,725  ........................
Satellite UHF/VHF Commercial:
    1. All Markets..............         1,075  FCC Satellite TV, P.O.
                                                 Box 358835, Pittsburgh,
                                                 PA 15251-5835.
    2. Construction Permits.....           535  ........................

[[Page 41995]]

 
Low Power TV, TV/FM Translator,            395  FCC, Low Power, P.O. Box
 & TV/FM Booster (47 CFR part                    358835, Pittsbugh, PA
 74)                                             15251-5835.
Broadcast Auxiliary.............            10  FCC, Auxiliary, P.O. Box
                                                 358835, Pittsburgh, PA
                                                 15251-5835.
------------------------------------------------------------------------


0
4. Section 1.1154 is revised to read as follows:


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

------------------------------------------------------------------------
                                   Fee amount            Address
------------------------------------------------------------------------
Radio facilities:
    1. Microwave (Domestic              $60.00  FCC, P.O. Box 358994,
     Public Fixed) (Electronic                   Pittsburgh, PA 15251-
     Filing) (FCC Form 601 &                     5994.
     159).
Carriers:
    1. Interstate Telephone             .00243  FCC, Carriers, P.O. Box
     Service Providers (per                      358835, Pittsburgh, PA
     interstate and                              15251-5835.
     international end-user
     revenues (see FCC Form 499-
     A).
------------------------------------------------------------------------


0
5. Section 1.1155 is revised to read as follows:


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

------------------------------------------------------------------------
                                   Fee amount            Address
------------------------------------------------------------------------
1. Cable Television Relay                 $155  FCC, Cable, P.O. Box
 Service.                                        358835, Pittsburgh, PA
                                                 15251-5835.
2. Cable TV System (per                    .72  ........................
 subscriber).
------------------------------------------------------------------------


0
6. Section 1.1156 is revised to read as follows:


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

------------------------------------------------------------------------
                                   Fee amount            Address
------------------------------------------------------------------------
Radio Facilities:
    1. International (HF)                 $765  FCC, International, P.O.
     Broadcast.                                  Box 358835, Pittsburgh,
                                                 PA 15251-5835.
    2. International Public              1,800  FCC, International, P.O.
     Fixed.                                      Box 358835, Pittsburgh,
                                                 PA 15251-5835.
Space Stations (Geostationary          111,925  FCC, Space Stations,
 Orbit).                                         P.O. Box 358835,
                                                 Pittsburgh, PA 15251-
                                                 5835.
Space Stations (Non-                   112,425  FCC, Space Stations,
 Geostationary Orbit).                           P.O. Box 358835,
                                                 Pittsburgh, PA 15251-
                                                 5835.
Earth Stations, Transmit/Receive           205  FCC, Space Stations,
 & Transmit Only (per                            P.O. Box 358835,
 authorization or registration).                 Pittsburgh, PA 15251-
                                                 5835.
Carriers, International Bearer            1.37  FCC, Space Stations,
 Circuits (per active 64KB                       P.O. Box 358835,
 circuit or equivalent.                          Pittsburgh, PA 15251-
                                                 5835.
------------------------------------------------------------------------

[FR Doc. 05-14267 Filed 7-20-05; 8:45 am]
BILLING CODE 6712-01-P