[Federal Register Volume 73, Number 103 (Wednesday, May 28, 2008)]
[Proposed Rules]
[Pages 30563-30591]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-11891]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 1

[MD Docket No. 08-65; FCC 08-126]


Assessment and Collection of Regulatory Fees For Fiscal Year 2008

AGENCY: Federal Communications Commission.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Commission will revise its Schedule of Regulatory Fees in 
order to recover the amount of regulatory fees that Congress has 
required it to collect for fiscal year 2008. Section 9 of the 
Communications Act of 1934, as amended, provides for the annual 
assessment and collection of regulatory fees under sections 9(b)(2) and 
9(b)(3), respectively, for annual ``Mandatory Adjustments'' and 
``Permitted Amendments'' to the Schedule of Regulatory Fees.

DATES: Comments are due May 30, 2008, and reply comments are due June 
6, 2008.

ADDRESSES: You may submit comments, identified by MD Docket No. 08-65, 
by any of the following methods:
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
     Federal Communications Commission's Web Site: http://www.fcc.gov/cgb/ecfs. Follow the instructions for submitting comments.
     E-mail: [email protected]. Include MD Docket No. 08-65 in the 
subject line of the message.
     Mail: Commercial overnight mail (other than U.S. Postal 
Service Express Mail, and Priority Mail, must be sent to 9300 East 
Hampton Drive, Capitol Heights, MD 20743. U.S. Postal Service first-
class, Express, and Priority mail should be addressed to 445 12th 
Street, SW., Washington DC 20554.

FOR FURTHER INFORMATION CONTACT: Mika Savir, Office of Managing 
Director at (202) 418-0384.

SUPPLEMENTARY INFORMATION:
    Adopted: May 7, 2008.
    Released: May 8, 2008.
    By the Commission:

Table of Contents

 
                                                               Paragraph
                                                                  No.
 
I. Introduction.............................................           1
II. Discussion..............................................           2
    A. FY 2008 Regulatory Fee Assessment Methodology--                 4
     Development of FY 2008 Regulatory Fees.................
        1. Calculation of Revenue and Fee Requirements......           4
        2. Additional Adjustments to Payment Units..........           5
            a. Commercial Mobile Radio Service (``CMRS'')              5
             Messaging Service..............................
            b. Regulatory Fee Obligations for AM Expanded              6
             Band Broadcasters..............................
    B. International Bearer Circuits........................           8
    C. Administrative and Operational Issues................           9
        1. Use of Fee Filer.................................          10
        2. New Lock Box Bank................................          12
        3. New Receiving Bank for Wire Payments.............          13
        4. Proposals for Notification and Collection of               14
         Regulatory Fees....................................
            a. Interstate Telecommunications Service                  17
             Providers (``ITSPs'')..........................
            b. Satellite Space Station Licensees............          19
            c. Media Services Licensees.....................          21
            d. CMRS Cellular and Mobile Services Assessments          24
            e. Cable Television Subscribers.................          28
        5. Streamlined Regulatory Fee Payment Process for             30
         CMRS Cellular and Mobile Providers.................
        6. Future Streamlining of the Regulatory Fee                  31
         Assessment and Collection Process..................
III. Procedural Matters.....................................          32
    A. Payment of Regulatory Fees...........................          32
        1. De Minimis Fee Payment Liability.................          32
        2. Standard Fee Calculations and Payment Dates......          33
    B. Enforcement..........................................          34
    C. Initial Regulatory Flexibility Analysis..............          36

[[Page 30564]]

 
    D. Initial Paperwork Reduction Act Analysis.............          37
    E. Ex Parte Rules.......................................          38
    F. Filing Requirements..................................          39
IV. Order...................................................          44
V. Ordering Clauses.........................................          50
Attachments
Attachment A Initial Regulatory Flexibility Analysis
Attachment B Sources of Payment Unit Estimates for FY 2008
Attachment C Calculation of Revenue Requirements and Pro-
 Rata Fees
Attachment D Proposed FY 2008 Schedule of Regulatory Fees
Attachment E Factors, Measurements, and Calculations that
 Determine Station Contours and Population Coverages
Attachment F FY 2007 Schedule of Regulatory Fees
 

I. Introduction

    1. Section 9 of the Communications Act of 1934, as amended (``the 
Act''), requires the Commission to assess fees to recover the 
regulatory costs associated with the Commission's enforcement, policy 
and rulemaking, user information, and international activities.\1\ In 
this Notice of Proposed Rulemaking (``Notice''), we propose to collect 
$312,000,000 in regulatory fees for Fiscal Year (``FY'') 2008. In this 
proceeding we seek comment on several regulatory fee issues for FY 2008 
and also announce the new lock box address for payments to the 
Commission.
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    \1\ 47 U.S.C. 159.
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II. Discussion

    2. In this Notice, we seek comment on the development of FY 2008 
regulatory fees collected pursuant to section 9 of the Act. For FY 
2008, we propose to retain the established methods and policies that 
the Commission has used to collect regulatory fees in the past except 
as discussed below. For the FY 2008 regulatory fee cycle, we propose to 
retain most of the administrative measures used for notification, 
assessment, and pre-billing of regulatory fees of previous years. As we 
have in previous years, we seek comment on ways to improve the 
Commission's administrative processes for notifying entities of their 
regulatory fee obligations and collecting their payments.
    3. The Commission is obligated to collect $312,000,000 in 
regulatory fees during FY 2008 to fund the Commission's operations. 
Consistent with our established practice, we intend to collect these 
fees in the August-September 2008 time frame in order to collect the 
required amount by the end of the fiscal year.

A. FY 2008 Regulatory Fee Assessment Methodology--Development of FY 
2008 Regulatory Fees

1. Calculation of Revenue and Fee Requirements
    4. For our FY 2008 regulatory fee assessment, we propose to use 
essentially the same section 9 regulatory fee assessment methodology 
adopted for FY 2007, except as discussed below. Each fiscal year, the 
Commission proportionally allocates to fee categories the total amount 
that must be collected through our section 9 regulatory fees.\2\ 
Consistent with past practice, we propose to divide the FY 2008 payment 
amount by the number of payment units in each fee category to calculate 
the unit fee. For cases involving small fees, we propose to divide the 
resulting unit fee by the term of the license. We propose to round 
these fees consistent with the requirements of section 9(b)(2) of the 
Act. We seek comment on these proposals.
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    \2\ See Appendix C for the proposed FY 2008 regulatory fee 
assessment methodology, including a comparison to the FY 2007 
results.
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2. Additional Adjustments to Payment Units
a. Commercial Mobile Radio Service (``CMRS'') Messaging Service
    5. CMRS Messaging Services, which replaced the CMRS One-Way Paging 
fee category in FY 1997, includes all narrowband services.\3\ Since FY 
2002, we have proposed to continue our policy of maintaining the CMRS 
Messaging Service regulatory fee at the rate that was first established 
in FY 2002 \4\ (i.e., $0.08 per subscriber), noting that the subscriber 
base in this industry has declined significantly.\5\ We found that 
maintaining the CMRS Messaging regulatory fee rate at $0.08 per 
subscriber, rather than allowing it to increase, was the appropriate 
level of relief to be afforded to the messaging industry.\6\ In this 
NPRM we propose to maintain the messaging service regulatory fee at 
$0.08 per subscriber. We seek comment on this proposal. Commenters 
suggesting a different approach, i.e., a proposal other than keeping 
the fee at $0.08 per subscriber, should provide industry data to 
support their position.
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    \3\ See Assessment and Collection of Regulatory Fees for Fiscal 
Year 1997, MD Docket No. 96-186, Report and Order, 12 FCC Rcd 17161, 
17184-85, para. 60 (1997) (``FY 1997 Report and Order'').
    \4\ See Assessment and Collection of Regulatory Fees for Fiscal 
Year 2003, MD Docket No. 03-83, Report and Order, 18 FCC Rcd 15985, 
15992, para. 21 (2003) (``FY 2003 Report and Order'').
    \5\ See Assessment and Collection of Regulatory Fees for Fiscal 
Year 2007, MD Docket No. 07-81, Notice of Proposed Rulemaking, 22 
FCC Rcd 7975, 7978, para. 7 (2007) (``FY 2007 NPRM''). The 
subscriber base in the paging industry declined 83 percent from 40.8 
million to 7.1 million, from FY 1997 to FY 2007, according to FY 
2007 collection data, as of September 30, 2007.
    \6\ See Assessment and Collection of Regulatory Fees for Fiscal 
Year 2007, MD Docket No. 07-81, Report and Order and Further Notice 
of Proposed Rulemaking, 22 FCC Rcd 15712, 15715, para. 9 (2007) 
(``FY 2007 Report and Order'').
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b. Regulatory Fee Obligations for AM Expanded Band Broadcasters
    6. The Commission initiated the migration of existing standard band 
AM stations to the expanded band to reduce interference and congestion 
in the existing standard band.\7\ AM expanded band radio stations, in 
the 1610-1700 kHz range, are currently exempt from payment of 
regulatory fees as a matter of policy. Standard band AM stations, in 
the 540-1600 kHz range, are subject to regulatory fees. Our decision 
several years ago not to require section 9 regulatory fee payments for 
AM expanded band stations was not a permanent exemption from regulatory

[[Page 30565]]

fees for AM expanded band radio service.\8\
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    \7\ See Assessment and Collection of Regulatory Fees for Fiscal 
Year 2005 and Assessment and Collection of Regulatory Fees for 
Fiscal Year 2004, MD Docket Nos. 05-59 and 04-73, Report and Order 
and Order on Reconsideration, 20 FCC Rcd 12259, 12267, para. 25 
(2005) (``FY 2005 Report and Order'').
    \8\ FY 2005 Report and Order, 20 FCC Rcd at 12267, para. 25.
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    7. We now seek comment on the most efficient methods of assessing a 
regulatory fee on expanded band AM licenses. We seek comment 
particularly regarding those instances where the licensee chooses to 
retain the expanded band service while giving up the standard band 
station.\9\ We also seek comment on whether we should impose a separate 
regulatory fee on an expanded band licensee that holds a standard band 
license and continues to operate both stations (i.e., the licensee is 
not migrating to the expanded band but is keeping two licenses).
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    \9\ See Assessment and Collection of Regulatory Fees for Fiscal 
Year 2005, MD Docket No. 05-59, Notice of Proposed Rulemaking, 20 
FCC Rcd 3885, 3896, para. 36 (2005).
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B. International Bearer Circuits

    8. In our FY 2006 NPRM,\10\ we noted that VSNL Telecommunications 
(US) Inc. (``VSNL'') had filed a Petition for Rulemaking urging the 
Commission to revise its regulatory fee methodology for bearer 
circuits;\11\ and that we issued a public notice designating the 
proceeding as RM-11312 and requesting comment on the petition.\12\ We 
stated in our FY 2006 Report and Order that the issues presented in the 
Petition warrant consideration separately from the Commission's annual 
regulatory fee proceeding.\13\ In our FY 2007 NPRM, we received a set 
of joint comments filed by seven submarine cable landing licensees 
urging the Commission to take similar action.\14\ We grant VSNL's 
petition and seek comment herein on the methodology used to calculate 
regulatory fees for providers of international bearer circuits. We seek 
comment on whether the Commission should retain the current methodology 
used to these regulatory fees, or change or modify the methodology (and 
if so, how?).
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    \10\ See Assessment and Collection of Regulatory Fees for Fiscal 
Year 2006, MD Docket No. 06-68, Notice of Proposed Rulemaking, 21 
FCC Rcd 3708, 3718, n.20 (2006) (``FY 2006 NPRM'').
    \11\ See Petition for Rulemaking of VSNL Telecommunications (US) 
Inc., RM-11312 (filed Feb. 6, 2006) (``VSNL Petition'').
    \12\ See Consumer and Governmental Affairs Bureau, Reference 
Information Center, Public Notice, Report No. 2759 (rel. Feb. 15, 
2006).
    \13\ See Assessment and Collection of Regulatory Fees for Fiscal 
Year 2006, MD Docket No. 06-68, Report and Order, 21 FCC Rcd 8092, 
8098-99, para. 18 (2006) (``FY 2006 Report and Order'').
    \14\ See Joint Comments at 1.
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C. Administrative and Operational Issues

    9. We seek comment on the administrative and operational processes 
used to collect the annual section 9 regulatory fees. These issues do 
not affect the amount of regulatory fees parties are obligated to 
submit; however, the administrative and operational issues affect the 
process of submitting payment. We invite comment on ways to improve 
these processes.
    1. Use of Fee Filer
    10. We continue to encourage regulatees to use the Commission's 
online electronic Fee Filer application. Using the Commission's Fee 
Filer application reduces paperwork burdens on payors because it 
eliminates the need to file a paper FCC Form 159. It also allows payors 
to make a single payment for pre-billed and non-billed regulatory fees. 
Regulatees submitting more than ten (10) Form 159-Cs are strongly 
encouraged to use Fee Filer when sending their regulatory fee payment.
    11. Regulatees who file their FCC Form 159 information online via 
Fee Filer may choose to pay by online ACH debit from a bank account, by 
online credit card, by check or money order, by wire, or by credit card 
on paper. Payors wishing to remit payment via check, money order, wire, 
or credit card on paper must print a Fee Filer-generated Form 159-E 
Remittance Voucher to accompany payment, in lieu of Form 159. We note 
that Fee Filer will accept credit card payments of up to $99,999.99; 
the FCC accepts ACH debits (via Fee Filer) from a bank account in any 
denomination. All online payments are considered received by the FCC at 
the time that the FCC accepts the payor's bank account information or 
authorizes the payor's credit card.
2. New Lock Box Bank
    12. We advise all regulatees that the Commission has a new lock box 
bank. All lock box payments to the Commission for FY 2008 will be 
processed by U.S. Bank, St. Louis, Missouri, and payable to the FCC. 
For all regulatory fees, the address is: Federal Communications 
Commission, Regulatory Fees, P.O. Box 979084, St. Louis, MO 63197-9000.
3. New Receiving Bank for Wire Payments
    13. We also advise all regulatees that the Commission has a new 
receiving bank for wire payments. The new receiving bank is the Federal 
Reserve Bank, New York, New York (TREAS NYC). When making a wire 
transfer, regulatees must fax a copy of their completed remittance 
instrument to U.S. Bank, St. Louis, Missouri at (314) 418-4232 at least 
one hour before initiating the wire transfer (but on the same business 
day), so as to not delay crediting their account. Wire transfers 
initiated after 6:00 p.m. (EDT) will be credited the next business day. 
Complete instructions for making wire payments are posted at http://www.fcc.gov/fees/wiretrans.html.
4. Proposals for Notification and Collection of Regulatory Fees
    14. Public Notices and fact sheets. In this section, we seek 
comment on the administrative processes that the Commission uses to 
notify regulatees and collect regulatory fees. Each year we post public 
notices and fact sheets pertaining to regulatory fees on our Web site. 
These documents contain information about the payment due date and the 
regulatory fee payment procedures. We will continue to post this 
information on http://www.fcc.gov/fees/regfees.html. We seek comment on 
ways to improve our regulatory fee public notices and fact sheets.
    15. Regulatees are expected to pay their yearly regulatory fees by 
filing FCC Form 159 or by accessing the Commission's online Fee Filer 
application.\15\ As a general practice, we will not send regulatory fee 
material to regulatees via surface mail. However, in the event that 
regulatees do not have access to the Internet, we will mail public 
notices and other relevant material upon request. Regulatees and the 
general public may request such information by contacting the FCC 
Financial Operations Help Desk at (877) 480-3201, Option 4. We seek 
comment on ways to improve our administrative processes.
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    \15\ http://www.fcc.gov/fees/feefiler.html.
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    16. Pre-bills. We will not send public notices and fact sheets to 
regulatees en masse; however, we propose to continue to send specific 
regulatory fee pre-bills or assessment notifications via surface mail 
to the select fee categories discussed below.\16\ Pre-bills are 
hardcopy billing statements that the Commission mails to certain 
regulatees. The Commission currently sends pre-bills to interstate 
telecommunications service providers (``ITSPs''), satellite space 
station licensees (both geostationary and non-geostationary), to

[[Page 30566]]

holders of Cable Television Relay Service (``CARS'') licenses, and 
earth station licensees. The remaining regulatees do not receive pre-
bills. We seek comment on ways to improve this practice. Commenters 
should discuss whether we should add other regulatory fee categories to 
our pre-bill procedures.
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    \16\ 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) but it is not entered into the Commission's 
accounting system as a current debt. A pre-bill is considered an 
account receivable in the Commission's accounting system. Pre-bills 
reflect the amount owed and have a payment due date of the last day 
of the regulatory fee payment window. Consequently, if a pre-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), and 1.1910.
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a. Interstate Telecommunications Service Providers (``ITSPs'')
    17. In FY 2001, we began mailing pre-completed FCC Form 159-W 
assessments to carriers in an effort to assist them in paying their 
ITSP regulatory fee. The fee amount on FCC Form 159-W was calculated 
from the FCC Form 499-A worksheet. Beginning in FY 2004, we mailed the 
completed FCC Form 159-W as a pre-bill, rather than as an assessment of 
amount due. Other than the manner in which Form 159- 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 ITSP regulatory fees. We seek comment on whether we should 
continue this pre-billing process for ITSPs in FY 2008.
    18. In FY 2007, we adopted a proposal to round lines 14 (total 
subject revenues) and 16 (total regulatory fee owed) on FCC Form 159-W 
to the nearest dollar. This revision enabled the Commission to process 
the ITSP regulatory fee payments more quickly because rounding was no 
longer a hindrance that slowed the processing of payments. In FY 2008, 
we will continue to round lines 14 and 16 on FCC Form 159-W to the 
nearest dollar. We seek comment on other ways that we can improve our 
pre-billing initiative for ITSPs.
b. Satellite Space Station Licensees
    19. Beginning in FY 2004, we mailed regulatory fee pre-bills via 
surface mail to licensees in our two satellite space station service 
categories. Specifically, geostationary orbit space station (``GSO'') 
licensees received bills requesting regulatory fee payment for 
satellites that (1) were licensed by the Commission and operational on 
or before October 1 of the respective fiscal year; and (2) were not co-
located with and technically identical to another operational satellite 
on that date (i.e., were not functioning as a spare satellite). Non-
geostationary orbit space station (``NGSO'') licensees received pre-
bills requesting regulatory fee payment for systems that were licensed 
by the Commission and operational on or before October 1 of the 
respective fiscal year.
    20. For FY 2008, we propose to continue mailing pre-bills for our 
GSO and NGSO satellite space station categories. We seek comment on 
this proposal. We emphasize that the pre-bills that we propose to 
generate for our GSO and NGSO licensees will only be for the satellite 
or system aspects of their respective operations. GSO and NGSO 
licensees typically have regulatory fee obligations in other service 
categories (e.g., earth stations, broadcast facilities), and we expect 
satellite operators to meet their full fee payment obligation for all 
of their FCC holdings. We seek comment on our proposal to generate 
regulatory fee pre-bills for our two satellite space station service 
categories.
c. Media Services Licensees
    21. Beginning in FY 2003, we sent fee assessment notifications via 
surface mail to media services entities on a per-facility basis. The 
notifications provided the assessed fee amount for the facility in 
question, as well as the data attributes that determined the fee 
amount. We have since refined this initiative with improved 
results.\17\ We propose to continue our assessment initiative for media 
services licensees in FY 2008.\18\ We seek comment on this proposal.
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    \17\ Some of those refinements have been to provide licensees 
with a Commission-authorized Web site to update or correct any 
information concerning their facilities, and to amend their fee-
exempt status, if need be. Also, our notifications now provide 
licensees with a telephone number to call in the event that they 
need customer assistance. The notifications themselves have been 
refined so that licensees of fewer than four facilities receive 
individual fee assessment postcards for their facilities; whereas 
licensees of four or more facilities now receive a single assessment 
letter that lists all of their facilities and the associated 
regulatory fee obligation for each facility.
    \18\ We again propose to issue fee assessments 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, to the 
extent that applicants, permittees and licensees of such facilities 
do not qualify as government entities or non-profit entities. Fee 
assessments have not been issued for broadcast auxiliary stations in 
prior years, nor will they be issued in FY 2008.
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    22. Consistent with procedures used last year, we propose to mail 
assessment notifications to licensees to their primary record of 
contact populated in our Consolidated Database System (``CDBS'') and to 
their secondary record of contact, if available. We seek comment on 
this proposal. We will continue to make the Commission-authorized Web 
site available to licensees to update or correct any information 
concerning their facilities and to amend their fee-exempt status, if 
need be.\19\ If there is a change of address for the facility, it is 
the licensee's responsibility to make the address change in the Media 
Bureau's CDBS system, as well as in the Commission's Registration 
System (``CORES'').
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    \19\ The Commission-authorized Web site for media services 
licensees is http://www.fccfees.com.
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    23. Under our proposal, licensees must still submit a completed FCC 
Form 159 Remittance Advice with their fee payments. The assessment 
notifications, whether in the form of a letter or postcard, cannot be 
used as a substitute for a completed Form 159.
d. CMRS Cellular and Mobile Services Assessments
    24. As we have done in prior years, we propose to mail an 
assessment letter to Commercial Mobile Radio Service (``CMRS'') 
providers using data from the Numbering Resource Utilization Forecast 
(``NRUF'') report that is based on ``assigned'' number counts that have 
been adjusted for porting to net Type 0 ports (``in'' and ``out'').\20\ 
This letter will include a listing of the carrier's Operating Company 
Numbers (``OCNs'') upon which the assessment is based.\21\ Consistent 
with existing practice, the letters will not include OCNs with their 
respective assigned number counts, but rather, an aggregate total of 
assigned numbers for each carrier. We also propose to continue our 
procedure of giving entities an opportunity to revise their subscriber 
counts by sending two rounds of assessment letters--an initial 
assessment and a final assessment letter. We seek comment on this 
proposal.
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    \20\ See Assessment and Collection of Regulatory Fees for Fiscal 
Year 2005 and Assessment and Collection of Regulatory Fees for 
Fiscal Year 2004, MD Docket Nos. 05-59 and 04-73, Report and Order 
and Order on Reconsideration, 20 FCC Rcd 12259, 12264, para. 38-44 
(2005).
    \21\ Id.
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    25. If the number of subscribers on the initial assessment letter 
differs from the subscriber count the service provider provided on its 
NRUF form, the carrier can correct its subscriber count by returning 
the assessment letter or by contacting the Commission and stating a 
reason for the change, such as the purchase or the sale of a 
subsidiary, including the date of the transaction, and any other 
information that will help to justify a reason for the change. If we 
receive no response or correction to our initial assessment letter, we 
will expect the fee payment to be based on the number of subscribers 
listed on the initial assessment. We will review all responses to 
initial assessment letters and determine whether a change in the number 
of subscribers is warranted. We

[[Page 30567]]

will then generate and mail a final assessment letter. The final 
assessment letter will inform carriers as to whether or not we accept 
the changed number of subscribers. As in previous years, operators will 
certify their subscriber counts in Block 30 of the FCC Form 159 
Remittance Advice when making their regulatory fee payments. We seek 
comment on our current procedures of assessing CMRS subscriber counts 
(for NRUF filers) and other ways to improve the process.
    26. Some carriers may not be sent a letter of assessment because 
they had not filed the NRUF form. We propose that these carriers 
compute their fee payment using the standard methodology \22\ that is 
currently in place for CMRS Wireless services (e.g., compute their 
subscriber counts as of December 31, 2007), and submit their payment 
accordingly on FCC Form 159. The Commission may audit the number of 
subscribers for which regulatory fees are paid, whether a carrier 
receives an assessment letter or computes the subscriber count itself. 
In the event that the Commission determines that the number of 
subscribers is inaccurate or that an insufficient reason is given for 
making a correction on the initial assessment letter, the Commission 
will assess the carrier for the difference between what was paid and 
what should have been paid.
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    \22\ Federal Communications Commission, Regulatory Fees Fact 
Sheet: What You Owe--Commercial Wireless Services for FY 2005 at 1 
(rel. Jul. 2005).
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    27. We, therefore, propose to (1) derive the subscriber count from 
NRUF data based on ``assigned'' number counts that have been adjusted 
for porting to net Type 0 ports (``in'' and ``out''); (2) provide 
carriers with an opportunity to revise their subscriber counts at the 
time when the initial assessment letter is mailed; and (3) require 
carriers to confirm their subscriber counts at the aggregate level 
using data in the NRUF report. We seek comment on these proposals.
e. Cable Television Subscribers
    28. We propose to continue to permit cable television operators to 
base their regulatory fee payment on their company's aggregate year-end 
subscriber count, rather than requiring them to sub-report subscriber 
counts on a per community unit identifier (``CUID'') basis on the FCC 
Form 159 Remittance Advice. We seek comment on this proposal. 
Operators, after providing their company's aggregate subscriber count 
in Block 25A of the FCC Form 159, will still be required to certify the 
accuracy of the subscriber count in Block 30. This practice has worked 
well for the Commission the past three fiscal years and has eased 
administrative burdens for the cable television industry.
    29. Beginning in FY 2006, we sent an electronic message to e-mail 
addresses populated in the Media Bureau's Cable Operations and 
Licensing System (``COALS'') to notify them of the amount and due date 
of regulatory fees for basic cable television subscribers. We propose 
to continue this effort for FY 2008, but we are not sure if this 
notification practice is effective. We seek comment on whether this 
practice of sending electronic e-mail notification to cable operators 
should be continued.
5. Streamlined Regulatory Fee Payment Process for CMRS Cellular and 
Mobile Providers
    30. In FY 2006, we streamlined the CMRS payment process by 
eliminating the requirement for CMRS providers to identify their 
individual calls signs when making their regulatory fee payment, 
requiring instead for CMRS providers to pay their regulatory fees only 
at the aggregate subscriber level without having to identify their 
various call signs.\23\ We propose to continue this practice in FY 
2008. We seek comment on this proposal. In addition, to lessen the 
administrative burden on licensees, we proposed in FY 2007 to 
consolidate the CMRS cellular and CMRS mobile fee categories into one 
fee category and as one fee code, thereby eliminating the requirement 
for CMRS providers to separate their subscriber counts into CMRS 
cellular and CMRS mobile fee categories during the regulatory fee 
payment process. This consolidation of fee categories enabled the 
Commission to process payments more quickly and accurately. For FY 
2008, we propose to continue this practice of combining the CMRS 
cellular and CMRS mobile fee categories into one regulatory fee 
category. We seek comment on this proposal.
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    \23\ See Assessment and Collection of Regulatory Fees for Fiscal 
Year 2006, MD Docket No. 06-68, Report and Order, 21 FCC Rcd 8092, 
8105, para. 48 (2006).
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6. Future Streamlining of the Regulatory Fee Assessment and Collection 
Process
    31. We continue to welcome comments concerning our commitment to 
reviewing, streamlining, and modernizing our statutorily required fee 
assessment and collection procedures. Our areas of particular interest 
include: (1) The process for notifying licensees about changes in the 
annual Schedule of Regulatory Fees and how it can be improved; (2) the 
most effective way to disseminate regulatory fee assessments and bills, 
e.g., through surface mail, e-mail, list server using Listserv, online 
Web site, or some other mechanism; (3) the fee payment process, 
including how the agency's online regulatory fee filing system (Fee 
Filer) can be enhanced; (4) the timing of fee payments, including 
whether we should alter the existing section 9 regulatory fee payment 
window in any way; and (5) the timing of fee assessments and pre-bills.

III. Procedural Matters

A. Payment of Regulatory Fees

1. De Minimis Fee Payment Liability
    32. Consistent with past practice, regulatees whose total FY 2008 
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 2008 regulatory fees.
2. Standard Fee Calculations and Payment Dates
    33. The Commission will, for the convenience of payers, accept fee 
payments made in advance of the window for the payment of regulatory 
fees. Licensees are reminded that, under our current rules, the 
responsibility for payment of fees by service category is as follows: 
\24\
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    \24\ As we noted earlier in our request for comments in possible 
adjustments to payment units, e.g., para. 6-12, we seek comment 
addressing several areas in our regulatory fees. Such comments may 
result in modification of the fee calculations discussed above and 
the methodology stated below. See, e.g., note 24.
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     Media Services: Regulatory fees must be paid for initial 
construction permits that were granted on or before October 1, 2007 for 
AM/FM radio stations, VHF/UHF television stations and satellite 
television stations. Regulatory fees must be paid for all broadcast 
facility licenses granted on or before October 1, 2007. In instances 
where a permit or license is transferred or assigned after October 1, 
2007, responsibility for payment rests with the holder of the permit or 
license as of the fee due date.
     Wireline (Common Carrier) Services: Regulatory fees must 
be paid for authorizations that were granted on or before October 1, 
2007. In instances where a permit or license is transferred or assigned 
after October 1, 2007, responsibility for payment rests with the holder 
of the permit or license as of the fee due date.
     Wireless Services: CMRS cellular, mobile, and messaging 
services (fees based upon a subscriber, unit or circuit

[[Page 30568]]

count): Regulatory fees must be paid for authorizations that were 
granted on or before October 1, 2007. The number of subscribers, units 
or circuits on December 31, 2007 will be used as the basis from which 
to calculate the fee payment.
     The first eleven regulatory fee categories in our Schedule 
of Regulatory Fees (see Attachment D) pay what we refer to as ``small 
multi-year wireless regulatory fees.'' Entities pay these regulatory 
fees in advance for the entire amount of their five-year or ten-year 
term of initial license, and only pay regulatory fees again when the 
license is renewed or a new license is obtained. We include these 
eleven categories in our Schedule of Regulatory Fees to publicize our 
estimates of the number of ``small multi-year wireless'' licenses that 
will be renewed or newly obtained in FY 2008.
     Multichannel Video Programming Distributor Services (cable 
television operators and CARS licensees): Regulatory fees must be paid 
for the number of basic cable television subscribers as of December 31, 
2007.\25\ Regulatory fees also must be paid for CARS licenses that were 
granted on or before October 1, 2007. In instances where a CARS license 
is transferred or assigned after October 1, 2007, responsibility for 
payment rests with the holder of the license as of the fee due date.
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    \25\ 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. 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 2007, rather than on a count as of December 31, 
2007. But see para. 8-12 above.
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     International Services: Regulatory fees must be paid for 
earth stations, geostationary orbit space stations and non-
geostationary orbit satellite systems that were licensed and 
operational on or before October 1, 2007. In instances where a license 
is transferred or assigned after October 1, 2007, responsibility for 
payment rests with the holder of the license as of the fee due date. 
Regulatory fees must be paid for international bearer circuits based on 
the number of active circuits as of December 31, 2007.\26\
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    \26\ 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. Non-common carrier 
submarine cable operators are also to pay fees for any and all 
international bearer circuits provided as a private line service to 
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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B. Enforcement

    34. Regulatory fee payment must be received and stamped at the 
lockbox bank by the last day of the regulatory fee filing window, and 
not merely postmarked by the last day of the window. As a reminder to 
all licensees, section 9(c) of the Act requires us to impose an 
additional charge as a penalty for late payment of any regulatory 
fee.\27\ A late payment penalty of 25 percent of the amount of the 
required regulatory fee will be assessed on the first day following the 
deadline date for filing of these fees. Failure to pay regulatory fees 
and/or any late penalty will subject regulatees to sanctions, including 
the Commission's Red Light Rule \28\ and the provisions set forth in 
the Debt Collection Improvement Act of 1996 (``DCIA'').\29\ 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.\30\ These administrative processing charges will be assessed on 
any delinquent regulatory fee, in addition to the 25 percent late 
charge penalty. In case of partial payments (underpayments) of 
regulatory fees, the licensee will be given credit for the amount paid, 
but if it is later determined that the fee paid is incorrect or not 
timely paid, then the 25 percent late charge penalty (and other charges 
and/or sanctions, as appropriate) will be assessed on the portion that 
is not paid in a timely manner.
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    \27\ 47 U.S.C. 159(c).
    \28\ See 47 CFR 1.1910.
    \29\ Delinquent debt owed to the Commission triggers application 
of the ``red light rule'' which requires offsets or holds on pending 
disbursements. 47 CFR 1.1910. In 2004, the Commission adopted rules 
implementing the requirements of the DCIA. See Amendment of Parts 0 
and 1 of the Commission's Rules, MD Docket No. 02-339, Report and 
Order, 19 FCC Rcd 6540 (2004); 47 CFR part 1, subpart O, Collection 
of Claims Owed the United States.
    \30\ 47 CFR 1.1940(d).
---------------------------------------------------------------------------

    35. 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.\31\ Failure to pay regulatory fees can also result in the 
initiation of a proceeding to revoke any and all authorizations held by 
the entity responsible for paying the delinquent fee(s).\32\
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    \31\ See 47 CFR 1.1161(c), 1.1164(f)(5), and 1.1910.
    \32\ See also para. 122, below.
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C. Initial Regulatory Flexibility Analysis

    36. An initial regulatory flexibility analysis (``IRFA'') is 
contained in Attachment A of the Appendix. Comments to the IRFA must be 
identified as responses to the IRFA and filed by the deadlines for 
comments on the Notice. The Commission will send a copy of the Notice, 
including the IRFA, to the Chief Counsel for Advocacy of the Small 
Business Administration.

D. Initial Paperwork Reduction Act Analysis

    37. This Notice does not contain proposed or modified information 
collections subject to the Paperwork Reduction Act of 1995 (``PRA''), 
Public Law 104-13. This Notice does not contain any new or modified 
``information collection burden for small business concerns with fewer 
than 25 employees,'' pursuant to the Small Business Paperwork Relief 
Act of 2002, Public Law 107-198.\33\ The forms already required by the 
Commission's regulatory fee process have been approved by the Office of 
Management and Budget under information collection 3060-0589.
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    \33\ See 44 U.S.C. 3506(c)(4).
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E. Ex Parte Rules

    38. This is as a ``permit-but-disclose'' proceeding subject to the 
requirements under section 1.1206(b) of the Commission's rules.\34\ Ex 
parte presentations are permissible if disclosed in accordance with 
Commission rules, except during the Sunshine Agenda period when 
presentations, ex parte or otherwise, are generally prohibited. Persons 
making oral ex parte presentations are reminded

[[Page 30569]]

that a memorandum summarizing a presentation must contain a summary of 
the substance of the presentation and not merely a listing of the 
subjects discussed. More than a one- or two-sentence description of the 
views and arguments presented is generally required.\35\ Additional 
rules pertaining to oral and written presentations are set forth in 
section 1.1206(b).
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    \34\ See 47 CFR 1.1206(b); see also 47 CFR 1.1202, 1.1203.
    \35\ See 47 CFR 1.1206(b)(2).
---------------------------------------------------------------------------

F. Filing Requirements

    39. Comments and Replies. Pursuant to sections 1.415 and 1.419 of 
the Commission's rules,\36\ interested parties may file comments on or 
before the dates indicated on the first page of this document. Comments 
may be filed using: (1) The Commission's Electronic Comment Filing 
System (``ECFS''), (2) the Federal Government's eRulemaking Portal, or 
(3) procedures for filing paper copies.\37\
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    \36\ See id. section 1.415, 1.419.
    \37\ See Electronic Filing of Documents in Rulemaking 
Proceedings, 13 FCC Rcd 11322 (1998).
---------------------------------------------------------------------------

    40. Electronic Filers: Comments may be filed electronically using 
the Internet by accessing the ECFS: http://www.fcc.gov/cgb/ecfs or the 
Federal eRulemaking Portal: http://www.regulations.gov. Filers should 
follow the instructions provided on the Web site for submitting 
comments. For ECFS filers, if multiple docket or rulemaking numbers 
appear in the caption of this proceeding, filers must transmit one 
electronic copy of the comments for each docket or rulemaking number 
referenced in the caption. In completing the transmittal screen, filers 
should include their full name, U.S. Postal Service mailing address, 
and the applicable docket or rulemaking number. Parties may also submit 
an electronic comment by Internet e-mail. To get filing instructions, 
filers should send an e-mail to [email protected], and include the following 
words in the body of the message, ``get form.'' A sample form and 
directions will be sent in response.
    41. Paper Filers: Parties who choose to file by paper must file an 
original and four copies of each filing. If more than one docket or 
rulemaking number appears in the caption of this proceeding, filers 
must submit two additional copies for each additional docket or 
rulemaking number. Filings can be sent by hand or messenger delivery, 
by commercial overnight courier, or by first-class or overnight U.S. 
Postal Service mail (although we continue to experience delays in 
receiving U.S. Postal Service mail). All filings must be addressed to 
the Commission's Secretary, Office of the Secretary, Federal 
Communications Commission.
     The Commission's contractor will receive hand-delivered or 
messenger-delivered paper filings for the Commission's Secretary at 236 
Massachusetts Avenue, NE., Suite 110, Washington, DC 20002. The filing 
hours at this location are 8 a.m. to 7 p.m. All hand deliveries must be 
held together with rubber bands or fasteners. Any envelopes must be 
disposed of before entering the building.
     Commercial overnight mail (other than U.S. Postal Service 
Express Mail and Priority Mail) must be sent to 9300 East Hampton 
Drive, Capitol Heights, MD 20743.
     U.S. Postal Service first-class, Express, and Priority 
mail should be addressed to 445 12th Street, SW., Washington, DC 20554.
    42. Availability of Documents. Comments, reply comments, and ex 
parte submissions will be available for public inspection during 
regular business hours in the FCC Reference Center, Federal 
Communications Commission, 445 12th Street, SW., CY-A257, Washington, 
DC 20554. These documents will also be available free online, via ECFS. 
Documents will be available electronically in ASCII, Word, and/or Adobe 
Acrobat.
    43. Accessibility Information. To request information in accessible 
formats (computer diskettes, large print, audio recording, and 
Braille), send an e-mail to [email protected] or call the FCC's Consumer 
and Governmental Affairs Bureau at (202) 418-0530 (voice), (202) 418-
0432 (TTY). This document can also be downloaded in Word and Portable 
Document Format (``PDF'') at http://www.fcc.gov.

IV. Order

    44. In WT Docket No. 03-66 (the ``BRS/EBS Proceeding''), the 
Commission sought comment on proposed changes to the regulatory fee 
structure for BRS.\38\ In 2006, the Commission adopted a new regulatory 
fee structure for BRS (the ``2006 Decision'').\39\ Specifically, as 
noted in the FY 2007 NPRM, the Commission adopted a megahertz-based 
approach for BRS regulatory fees and, using a concept similar to the 
Commission's annual scale of regulatory fees for broadcast television 
stations, established in the 2006 Decision three rate tiers based on 
the BTA ranking of each license.\40\ Under the 2006 Decision, BRS 
regulatory fees will use a MHz-based formula with three tiers of fees 
by markets. Instead of a flat fee amount per BRS license, BRS licensees 
will pay a fee in one of three fee categories based on Basic Trading 
Areas (``BTA'') ranked by population size.\41\ The highest fee will be 
assessed to licenses in BTAs ranked 1-60, licenses in BTAs ranked 61-
200 will have a lesser fee, and licenses for BTAs ranked 201-493 will 
pay the lowest fee.\42\
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    \38\ 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, WT Docket No. 03-66, Report and 
Order and Further Notice of Proposed Rulemaking, 19 FCC Rcd 14165, 
14296, para. 357 (2004) (``BRS/EBS Report and Order and FNPRM'').
    \39\ 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, WT Docket No. 03-66, Order on 
Reconsideration and Fifth Memorandum Opinion and Order and Third 
Memorandum Opinion and Order and Second Report and Order, 21 FCC Rcd 
5606, 5756-59, para. 367-376 (2006) (``2006 Decision'').
    \40\ See FY 2007 NPRM, 22 FCC Rcd at 7978, para. 8 n.8, citing 
the 2006 Decision. The three tiers are based on three categories of 
Basic Trading Areas (``BTA'') population rankings: BTAs 1-60, BTAs 
61-200, and BTAs 201-493. For BRS licensees that are licensed by 
geographic licensed service area (``GSA''), the BTA is the 
geographic center point of where its GSA is located. See 2006 
Decision, 21 FCC Rcd at 5759, para. 376.
    \41\ See 2006 Decision, 21 FCC Rcd at 5759, para. 376.
    \42\ Id.
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    45. In the FY 2007 NPRM, we sought comment on the implementation of 
the new BRS fee structure. Specifically, we invited commenters to 
suggest a simple method of calculating BRS regulatory fees that 
incorporates the complexity of using both elements of the 2006 
Decision, namely, the three rate tiers, to be based on the BTA ranking 
of each license, and the per megahertz fee.\43\ In particular, we 
invited comment on a formula or method for calculating regulatory fees 
that incorporates the 2006 Decision in a manner ``sensitive to rural 
operators in less densely populated areas.\44\
---------------------------------------------------------------------------

    \43\ FY 2007 NPRM, 22 FCC Rcd at 7978, para. 8.
    \44\ Id.
---------------------------------------------------------------------------

    46. In a Further Notice of Proposed Rulemaking, we proposed to use 
a weighted average approach based on the 2006 Decision to establish 
three tiers of regulatory fees using a 3:2:1 ratio, i.e., 3x for Tier 
1, 2x for Tier 2, and 1x for Tier 3, where x equals the base fee amount 
(Pro-rated FY Revenue Requirement for BRS divided by the weighted total 
number of BRS payment units).\45\ In adopting three fee tiers for

[[Page 30570]]

BRS, the Commission considered that BTAs ranked 1-60 generally have a 
population of greater than one million, BTAs ranked 61-200 generally 
have population of 250,000 to one million, and BTAs ranked 201-493 have 
a population of less than 250,000.\46\
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    \45\ Assessment and Collection of Regulatory Fees for Fiscal 
Year 2007, MD Docket No. 07-81, Report and Order and Further Notice 
of Proposed Rulemaking, 22 FCC Rcd 15712, 15726-15727, para. 46-50 
(2007) (``2007 FNPRM'').
    \46\ Id., 22 FCC Rcd at 15724-15725, para. 49.
---------------------------------------------------------------------------

    47. The second element of the 2006 Decision involved setting a fee 
per megahertz of licensed BRS spectrum. However, throughout the nation, 
BTA-by-BTA, the BRS radio service and its licensees are in the midst of 
a multi-year transition to a new band plan that, among other things, is 
modifying the amount of spectrum designated and licensed for BRS.\47\ 
Given the complexities associated with this ``moving target,'' we 
tentatively concluded that the public interest would be best served by 
implementing the fee per megahertz approach after the BRS transition 
concludes nationwide.\48\
---------------------------------------------------------------------------

    \47\ The transition plan creates a process for relocating 
Educational Broadband Service (``EBS'') licensees and BRS licensees 
from their current channel locations to their new spectrum blocks in 
the Lower Band Segment (``LBS''), Middle band Segment (``MBS''), or 
Upper Band Segment (``UBS''). The transition occurs by BTA and is 
undertaken by a proponent or multiple proponents. A proponent(s) 
must pay the cost of transitioning EBS licensees. The transition 
occurs in the following three phases: the Initiation Phase, the 
Transition Planning Phase, and the Transition Completion Phase.
    \48\ FY 2007 FNPRM, 22 FCC Rcd at 15727, para. 50.
---------------------------------------------------------------------------

    48. Comments on the 2007 FNPRM were filed by WCA \49\ and by the 
law firm of Blooston, Mordkofsky, Dickens, Duffy, & Prendergast, LLP 
(``BloostonLaw'').\50\ WCA continues to advocate basing regulatory fees 
on a licensee's MHz/population, which the Commission has previously 
rejected.\51\ WCA also advocates making no changes until the transition 
is complete.\52\ BloostonLaw argues that there is insufficient 
information in the record to conclude that this proposal would benefit 
rural operators.\53\ BloostonLaw also contends that the fee should be 
based on the population within the licensee's geographic service 
area.\54\
---------------------------------------------------------------------------

    \49\ Comments of the Wireless Communications Association 
International, Inc., MD Docket No. 07-81 (filed Sep. 17, 2007) 
(``WCA Comments'').
    \50\ Comments, Blooston, Mordkofsky, Dickens, Duffy, & 
Prendergast, LLP, MD Docket No. 07-81 (filed Sep. 17, 2007) 
(``BloostonLaw Comments'').
    \51\ WCA Comments at 3-5.
    \52\ WCA Comments at 1.
    \53\ BloostonLaw Comments at 1-3.
    \54\ Id. at 3-4.
---------------------------------------------------------------------------

    49. After reviewing the record, we now conclude that we will 
continue the current practice of charging a flat fee per license until 
the BRS/EBS transition to the new band plan. Neither of the commenters 
supported the proposal contained in the 2007 FNPRM. Furthermore, WCA 
urges that no changes be made until the transition is complete. We also 
note that the transition is proceeding quickly. Transition initiation 
plans have been filed in 355 out of 493 BTAs, and the transition has 
been completed in 207 BTAs.\55\ Any changes we adopt could not take 
effect until we adopt the changes, the Commission sends a report to 
Congress, and 90 days passes. If the transition is complete in 2009 or 
2010, which seems possible, the interim system proposed in the 2007 
FNPRM could only be in place for one year. This effort would risk 
confusing licensees, and we believe that devoting Commission resources 
to implementing this interim system would be difficult to justify. 
Accordingly, we conclude that we will maintain the current system of 
charging a flat, per-license fee until the transition to the new band 
plan is complete.
---------------------------------------------------------------------------

    \55\ As of 2/1/08.
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V. Ordering Clauses

    50. Accordingly, It is Ordered that, 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), this Notice of Proposed 
Rulemaking and Order is hereby adopted.
    51. It is Further Ordered that the Commission's Consumer and 
Governmental Affairs Bureau, Reference Information Center, Shall Send a 
copy of this Notice of Proposed Rulemaking, including the Initial 
Regulatory Flexibility Analysis, to the Chief Counsel for Advocacy of 
the U.S. Small Business Administration.

Federal Communications Commission.
Gloria J. Miles,
Federal Register Liaison.

Attachment A--Initial Regulatory Flexibility Analysis

    52. As required by the Regulatory Flexibility Act (``RFA''),\56\ 
the Commission has prepared this Initial Regulatory Flexibility 
Analysis (``IRFA'') of the possible significant economic impact on 
small entities by the policies and rules in the present NPRM. Written 
public comments are requested on this IRFA. Comments must be identified 
as responses to the IRFA and must be filed on or before the dates 
indicated on the first page of this NPRM. The Commission will send a 
copy of the NPRM, including the IRFA, to the Chief Counsel for Advocacy 
of the Small Business Administration.\57\ In addition, the NPRM and 
IRFA (or summaries thereof) will be published in the Federal 
Register.\58\
---------------------------------------------------------------------------

    \56\ 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'').
    \57\ 5 U.S.C. 603(a).
    \58\ Id.
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I. Need for, and Objectives of, the Proposed Rules

    53. This rulemaking proceeding is initiated to obtain comments 
concerning the Commission's proposed amendment of its Schedule of 
Regulatory Fees in the amount of $312,000,000, the amount that Congress 
has required the Commission to recover. The Commission seeks to collect 
the necessary amount through its proposed Schedule of Regulatory Fees 
in the most efficient manner possible and without undue public burden.

II. Legal Basis

    54. This action, including publication of proposed rules, is 
authorized under sections (4)(i) and (j), 9, and 303(r) of the 
Communications Act of 1934, as amended.\59\
---------------------------------------------------------------------------

    \59\ 47 U.S.C. 154(i) and (j), 159, and 303(r).
---------------------------------------------------------------------------

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

    55. 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.\60\ The RFA 
generally defines the term ``small entity'' as having the same meaning 
as the terms ``small business,'' ``small organization,'' and ``small 
governmental jurisdiction.'' \61\ In addition, the term ``small 
business'' has the same meaning as the term ``small business concern'' 
under the Small Business Act.\62\ 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.\63\
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    \60\ 5 U.S.C. 603(b)(3).
    \61\ 5 U.S.C. 601(6).
    \62\ 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.''
    \63\ 15 U.S.C. 632.

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[[Page 30571]]

    56. Small Businesses. Nationwide, there are a total of 22.4 million 
small businesses, according to SBA data.\64\
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    \64\ See SBA, Programs and Services, SBA Pamphlet No. CO-0028, 
at p. 40 (July 2002).
---------------------------------------------------------------------------

    57. Small Organizations. Nationwide, there are approximately 1.6 
million small organizations.\65\
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    \65\ Independent Sector, The New Nonprofit Almanac & Desk 
Reference (2002).
---------------------------------------------------------------------------

    58. Small Governmental Jurisdictions. The term ``small governmental 
jurisdiction'' is defined generally as ``governments of cities, towns, 
townships, villages, school districts, or special districts, with a 
population of less than fifty thousand.'' \66\ Census Bureau data for 
2002 indicate that there were 87,525 local governmental jurisdictions 
in the United States.\67\ We estimate that, of this total, 84,377 
entities were ``small governmental jurisdictions.'' \68\ Thus, we 
estimate that most governmental jurisdictions are small.
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    \66\ 5 U.S.C. 601(5).
    \67\ U.S. Census Bureau, Statistical Abstract of the United 
States: 2006, Section 8, p. 272, Table 415.
    \68\ We assume that the villages, school districts, and special 
districts are small, and total 48,558. See U.S. Census Bureau, 
Statistical Abstract of the United States: 2006, section 8, p. 273, 
Table 417. For 2002, Census Bureau data indicate that the total 
number of county, municipal, and township governments nationwide was 
38,967, of which 35,819 were small. Id.
---------------------------------------------------------------------------

    59. 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.'' 
\69\ 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.\70\ 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.
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    \69\ 15 U.S.C. 632.
    \70\ 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).
---------------------------------------------------------------------------

    60. Incumbent Local Exchange Carriers (``ILECs''). 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.\71\ According to 
Commission data,\72\ 1,303 carriers have reported that they are engaged 
in the provision of incumbent local exchange services. Of these 1,303 
carriers, an estimated 1,020 have 1,500 or fewer employees and 283 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 our proposed action.
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    \71\ 13 CFR 121.201, North American Industry Classification 
System (NAICS) code 517110.
    \72\ FCC, Wireline Competition Bureau, Industry Analysis and 
Technology Division, ``Trends in Telephone Service'' at Table 5.3, 
Page 5-5 (June 2005) (``Trends in Telephone Service''). This source 
uses data that are current as of October 1, 2004.
---------------------------------------------------------------------------

    61. 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.\73\ According to Commission data,\74\ 769 carriers have 
reported that they are engaged in the provision of either competitive 
access provider services or competitive local exchange carrier 
services. Of these 769 carriers, an estimated 676 have 1,500 or fewer 
employees and 94 have more than 1,500 employees. In addition, 12 
carriers have reported that they are ``Shared-Tenant Service 
Providers,'' and all 12 are estimated to have 1,500 or fewer employees. 
In addition, 39 carriers have reported that they are ``Other Local 
Service Providers.'' Of the 39, an estimated 38 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 our proposed action.
---------------------------------------------------------------------------

    \73\ 13 CFR 121.201, NAICS code 517110.
    \74\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    62. 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.\75\ According to Commission data,\76\ 143 carriers have 
reported that they are engaged in the provision of local resale 
services. Of these, an estimated 141 have 1,500 or fewer employees and 
two have more than 1,500 employees. Consequently, the Commission 
estimates that the majority of local resellers are small entities that 
may be affected by our proposed action.
---------------------------------------------------------------------------

    \75\ 13 CFR 121.201, NAICS code 517310.
    \76\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    63. 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.\77\ According to Commission data,\78\ 770 carriers have 
reported that they are engaged in the provision of toll resale 
services. Of these, an estimated 747 have 1,500 or fewer employees and 
23 have more than 1,500 employees. Consequently, the Commission 
estimates that the majority of toll resellers are small entities that 
may be affected by our proposed action.
---------------------------------------------------------------------------

    \77\ 13 CFR 121.201, NAICS code 517310.
    \78\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    64. 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.\79\ According to Commission data,\80\ 654 carriers have 
reported that they are engaged in the provision of payphone services. 
Of these, an estimated 652 have 1,500 or fewer employees and two 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 our proposed action.
---------------------------------------------------------------------------

    \79\ 3 CFR 121.201, NAICS code 517110.
    \80\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    65. 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.\81\ According to Commission data,\82\ 316 carriers 
have

[[Page 30572]]

reported that they are engaged in the provision of interexchange 
service. Of these, an estimated 292 have 1,500 or fewer employees and 
24 have more than 1,500 employees. Consequently, the Commission 
estimates that the majority of IXCs are small entities that may be 
affected by our proposed action.
---------------------------------------------------------------------------

    \81\ 13 CFR 121.201, NAICS code 517110.
    \82\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    66. 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.\83\ According to Commission data,\84\ 23 carriers have 
reported that they are engaged in the provision of operator services. 
Of these, an estimated 20 have 1,500 or fewer employees and three have 
more than 1,500 employees. Consequently, the Commission estimates that 
the majority of OSPs are small entities that may be affected by our 
proposed action.
---------------------------------------------------------------------------

    \83\ 13 CFR 121.201, NAICS code 517110.
    \84\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    67. 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.\85\ According to Commission data,\86\ 89 carriers have 
reported that they are engaged in the provision of prepaid calling 
cards. Of these, an estimated 88 have 1,500 or fewer employees and one 
has more than 1,500 employees. Consequently, the Commission estimates 
that the majority of prepaid calling card providers are small entities 
that may be affected by our proposed action.
---------------------------------------------------------------------------

    \85\ 13 CFR 121.201, NAICS code 517310.
    \86\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    68. 800 and 800-Like Service Subscribers.\87\ 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.\88\ The most reliable 
source of information regarding the number of these service subscribers 
appears to be data the Commission receives from Database Service 
Management on the 800, 866, 877, and 888 numbers in use.\89\ According 
to our data, at the end of December 2004, the number of 800 numbers 
assigned was 7,540,453; the number of 888 numbers assigned was 
5,947,789; the number of 877 numbers assigned was 4,805,568; and the 
number of 866 numbers assigned was 5,011,291. We do not have data 
specifying the number of these subscribers that are independently owned 
and operated or have 1,500 or fewer 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 7,540,453 or fewer 
small entity 800 subscribers; 5,947,789 or fewer small entity 888 
subscribers; 4,805,568 or fewer small entity 877 subscribers, and 
5,011,291 or fewer entity 866 subscribers.
---------------------------------------------------------------------------

    \87\ We include all toll-free number subscribers in this 
category.
    \88\ 13 CFR 121.201, NAICS code 517310.
    \89\ ``Trends in Telephone Service'' at Tables 18.4, 18.5, 18.6, 
and 18.7.
---------------------------------------------------------------------------

    69. International Service Providers. There is no small business 
size standard developed specifically for providers of international 
service. The appropriate size standards under SBA rules are for the two 
broad census categories of ``Satellite Telecommunications'' and ``Other 
Telecommunications.'' Under both categories, such a business is small 
if it has $13.5 million or less in average annual receipts.\90\
---------------------------------------------------------------------------

    \90\ 13 CFR 121.201, NAICS codes 517410 and 517910.
---------------------------------------------------------------------------

    70. The first category of Satellite Telecommunications ``comprises 
establishments primarily engaged in providing point-to-point 
telecommunications services to other establishments in the 
telecommunications and broadcasting industries by forwarding and 
receiving communications signals via a system of satellites or 
reselling satellite telecommunications.'' \91\ For this category, 
Census Bureau data for 2002 show that there were a total of 371 firms 
that operated for the entire year.\92\ Of this total, 307 firms had 
annual receipts of under $10 million, and 26 firms had receipts of $10 
million to $24,999,999.\93\ Consequently, we estimate that the majority 
of Satellite Telecommunications firms are small entities that might be 
affected by our action.
---------------------------------------------------------------------------

    \91\ U.S. Census Bureau, 2002 NAICS Definitions, ``517410 
Satellite Telecommunications''; http://www.census.gov/epcd/naics02/def/NDEF517.HTM.
    \92\ U.S. Census Bureau, 2002 Economic Census, Subject Series: 
Information, ``Establishment and Firm Size (Including Legal Form of 
Organization),'' Table 4, NAICS code 517410.
    \93\ Id. An additional 38 firms had annual receipts of $25 
million or more.
---------------------------------------------------------------------------

    71. The second category of Other Telecommunications ``comprises 
establishments primarily engaged in (1) providing specialized 
telecommunications applications, such as satellite tracking, 
communications telemetry, and radar station operations; or (2) 
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.'' \94\ For this category, 
Census Bureau data for 2002 show that there were a total of 332 firms 
that operated for the entire year.\95\ Of this total, 259 firms had 
annual receipts of under $10 million and 15 firms had annual receipts 
of $10 million to $24,999,999.\96\ Consequently, we estimate that the 
majority of Other Telecommunications firms are small entities that 
might be affected by our action.
---------------------------------------------------------------------------

    \94\ U.S. Census Bureau, 2002 NAICS Definitions, ``517910 Other 
Telecommunications''; http://www.census.gov/epcd/naics02/def/NDEF517.HTM.
    \95\ U.S. Census Bureau, 2002 Economic Census, Subject Series: 
Information, ``Establishment and Firm Size (Including Legal Form of 
Organization),'' Table 4, NAICS code 517910.
    \96\ Id. An additional 14 firms had annual receipts of $25 
million or more.
---------------------------------------------------------------------------

    72. Wireless Service Providers. The SBA has developed a small 
business size standard for wireless firms within the two broad economic 
census categories of ``Paging'' \97\ and ``Cellular and Other Wireless 
Telecommunications.'' \98\ Under both categories, the SBA deems a 
wireless business to be small if it has 1,500 or fewer employees. For 
the census category of Paging, Census Bureau data for 2002 show that 
there were 807 firms in this category that operated for the entire 
year.\99\ Of this total, 804 firms had employment of 999 or fewer 
employees, and three firms had employment of 1,000 employees or 
more.\100\ Thus, under this category and associated small business size 
standard, the majority of firms can be considered small. For the census 
category of Cellular and Other Wireless Telecommunications, Census 
Bureau data for 2002 show that there were 1,397 firms in this category 
that

[[Page 30573]]

operated for the entire year.\101\ Of this total, 1,378 firms had 
employment of 999 or fewer employees, and 19 firms had employment of 
1,000 employees or more.\102\ Thus, under this second category and size 
standard, the majority of firms can, again, be considered small.
---------------------------------------------------------------------------

    \97\ 13 CFR 121.201, NAICS code 517211.
    \98\ 13 CFR 121.201, NAICS code 517212.
    \99\ U.S. Census Bureau, 2002 Economic Census, Subject Series: 
Information, ``Establishment and Firm Size (Including Legal Form of 
Organization,'' Table 5, NAICS code 517211.
    \100\ 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 for firms with ``1000 
employees or more.''
    \101\ U.S. Census Bureau, 2002 Economic Census, Subject Series: 
Information, ``Establishment and Firm Size (Including Legal Form of 
Organization),'' Table 5, NAICS code 517212.
    \102\ 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 for firms with ``1000 
employees or more.''
---------------------------------------------------------------------------

    73. 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.'' \103\ Under the SBA size standard, 
such a business is small if it has average annual receipts of $21 
million or less.\104\ According to Census Bureau data for 1997, there 
were 2,751 firms in this category that operated for the entire 
year.\105\ 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.\106\ Thus, under this size standard, the great 
majority of firms can be considered small entities.
---------------------------------------------------------------------------

    \103\ Office of Management and Budget, North American Industry 
Classification System, p. 515 (1997). NAICS code 518111, ``On-Line 
Information Services.''
    \104\ 13 CFR 121.201, NAICS code 518111.
    \105\ 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.
    \106\ 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.
---------------------------------------------------------------------------

    74. Cellular Licensees. The SBA has developed a small business size 
standard for wireless firms within the two broad economic census 
categories of ``Paging'' \107\ and ``Cellular and Other Wireless 
Telecommunications.'' \108\ Under both categories, the SBA deems a 
wireless business to be small if it has 1,500 or fewer employees. For 
the census category of Paging, Census Bureau data for 2002 show that 
there were 807 firms in this category that operated for the entire 
year.\109\ Of this total, 804 firms had employment of 999 or fewer 
employees, and three firms had employment of 1,000 employees or 
more.\110\ Thus, under this category and associated small business size 
standard, the majority of firms can be considered small. For the census 
category of Cellular and Other Wireless Telecommunications, Census 
Bureau data for 2002 show that there were 1,397 firms in this category 
that operated for the entire year.\111\ Of this total, 1,378 firms had 
employment of 999 or fewer employees, and 19 firms had employment of 
1,000 employees or more.\112\ Thus, under this second category and size 
standard, the majority of firms can, again, be considered small.
---------------------------------------------------------------------------

    \107\ 13 CFR 121.201, NAICS code 517211.
    \108\ 13 CFR 121.201, NAICS code 517212.
    \109\ U.S. Census Bureau, 2002 Economic Census, Subject Series: 
Information, ``Establishment and Firm Size (Including Legal Form of 
Organization,'' Table 5, NAICS code 517211.
    \110\ 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 for firms with ``1000 
employees or more.''
    \111\ U.S. Census Bureau, 2002 Economic Census, Subject Series: 
Information, ``Establishment and Firm Size (Including Legal Form of 
Organization,'' Table 5, NAICS code 517212.
    \112\ 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 for firms with ``1000 
employees or more.''
---------------------------------------------------------------------------

    75. Common Carrier Paging. As noted, the SBA has developed a small 
business size standard for wireless firms within the broad economic 
census categories of ``Cellular and Other Wireless 
Telecommunications.'' \113\ Under this SBA category, a wireless 
business is small if it has 1,500 or fewer employees. For the census 
category of Paging, U.S. Census Bureau data for 1997 show that there 
were 1,320 firms in this category, total, that operated for the entire 
year.\114\ 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.\115\ Thus, under this category and associated small business 
size standard, the great majority of firms can be considered small.
---------------------------------------------------------------------------

    \113\ 13 CFR 121.201, NAICS code 517212.
    \114\ 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.
    \115\ 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. 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.''
---------------------------------------------------------------------------

    76. In addition, 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.\116\ 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.\117\ The SBA has approved this 
definition.\118\ 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.\119\ Fifty-seven 
companies claiming small business status won 440 licenses.\120\ 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.\121\ 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.\122\ Currently, there are 
approximately 74,000 Common Carrier Paging licenses. According to the 
most recent Trends in Telephone Service, 408 private and common 
carriers reported that they were engaged in the provision of either 
paging or ``other mobile'' services.\123\ Of these, we estimate that 
589 are small, under the SBA-approved small business size 
standard.\124\ We estimate that the majority of common carrier paging 
providers would qualify as small entities under the SBA definition.
---------------------------------------------------------------------------

    \116\ 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).
    \117\ Paging Second Report and Order, 12 FCC Rcd at 2811, para. 
179.
    \118\ See Letter from Aida Alvarez, Administrator, SBA, to Amy 
Zoslov, Chief, Auctions and Industry Analysis Division, Wireless 
Telecommunications Bureau (``WTB''), FCC (Dec. 2, 1998) (``Alvarez 
Letter 1998'').
    \119\ See ``929 and 931 MHz Paging Auction Closes,'' Public 
Notice, 15 FCC Rcd 4858 (WTB 2000).
    \120\ See id.
    \121\ See ``Lower and Upper Paging Band Auction Closes,'' Public 
Notice, 16 FCC Rcd 21821 (WTB 2002).
    \122\ See ``Lower and Upper Paging Bands Auction Closes,'' 
Public Notice, 18 FCC Rcd 11154 (WTB 2003).
    \123\ ``Trends in Telephone Service'' at Table 5.3.
    \124\ 13 CFR 121.201, NAICS code 517211.
---------------------------------------------------------------------------

    77. 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

[[Page 30574]]

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.\125\ The SBA has approved these definitions.\126\ 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.
---------------------------------------------------------------------------

    \125\ 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).
    \126\ See Alvarez Letter 1998.
---------------------------------------------------------------------------

    78. 1670-1675 MHz Services. An auction for one license in the 1670-
1675 MHz band commenced on April 30, 2003 and closed the same day. One 
license was awarded. The winning bidder was not a small entity.
    79. 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.\127\ Under the SBA small business size standard, a business 
is small if it has 1,500 or fewer employees.\128\ According to Trends 
in Telephone Service data, 437 carriers reported that they were engaged 
in wireless telephony.\129\ We have estimated that 260 of these are 
small under the SBA small business size standard.
---------------------------------------------------------------------------

    \127\ 13 CFR 121.201, NAICS code 517212.
    \128\ 13 CFR 121.201, NAICS code 517212.
    \129\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    80. Broadband Personal Communications Service. The 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.\130\ 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.\131\ These 
small business size standards, in the context of broadband PCS 
auctions, have been approved by the SBA.\132\ 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.\133\ On March 23, 
1999, the Commission reauctioned 155 C, D, E, and F Block licenses; 
there were 113 small business winning bidders.\134\
---------------------------------------------------------------------------

    \130\ 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) (``PCS Report and Order''); see also 47 
CFR 24.720(b).
    \131\ See PCS Report and Order, 11 FCC Rcd at 7852, para. 60.
    \132\ See Alvarez Letter 1998.
    \133\ FCC News, ``Broadband PCS, D, E and F Block Auction 
Closes,'' No. 71744 (rel. Jan. 14, 1997).
    \134\ See ``C, D, E, and F Block Broadband PCS Auction Closes,'' 
Public Notice, 14 FCC Rcd 6688 (WTB 1999).
---------------------------------------------------------------------------

    81. 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.\135\ 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. On February 15, 2005, the 
Commission completed an auction of 188 C block licenses and 21 F block 
licenses in Auction No. 58. There were 24 winning bidders for 217 
licenses.\136\ Of the 24 winning bidders, 16 claimed small business 
status and won 156 licenses. On May 21, 2007, the Commission completed 
an auction of 33 licenses in the A, C, and F Blocks in Auction No. 
71.\137\ Of the 14 winning bidders, six were designated entities.\138\
---------------------------------------------------------------------------

    \135\ See ``C and F Block Broadband PCS Auction Closes; Winning 
Bidders Announced,'' Public Notice, 16 FCC Rcd 2339 (2001).
    \136\ See ``Broadband PCS Spectrum Auction Closes; Winning 
Bidders Announced for Auction No. 58,'' Public Notice, 20 FCC Rcd 
3703 (2005).
    \137\ See ``Auction of Broadband PCS Spectrum Licenses Closes; 
Winning Bidders Announced for Auction No. 71,'' Public Notice, 22 
FCC Rcd 9247 (2007).
    \138\ Id.
---------------------------------------------------------------------------

    82. 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.\139\ Through these auctions, the Commission awarded a 
total of 41 licenses, 11 of which were obtained by four small 
businesses.\140\ 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.\141\ 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.\142\ 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.\143\ The SBA has approved 
these small business size standards.\144\ 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.\145\ Three of 
these claimed status as a small or very small entity and won 311 
licenses.
---------------------------------------------------------------------------

    \139\ 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).
    \140\ 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 (rel. 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 (rel. Nov. 9, 1994).
    \141\ 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) (``Narrowband PCS Second Report and 
Order'').
    \142\ Narrowband PCS Second Report and Order, 15 FCC Rcd at 
10476, para. 40.
    \143\ Id.
    \144\ See Alvarez Letter 1998.
    \145\ See ``Narrowband PCS Auction Closes,'' Public Notice, 16 
FCC Rcd 18663 (WTB 2001).
---------------------------------------------------------------------------

    83. Lower 700 MHz Band Licenses. The Commission previously adopted 
criteria for defining three groups of small businesses for purposes of 
determining their eligibility for special provisions such as bidding 
credits.\146\ The Commission 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.\147\ A ``very small business'' is defined as an entity 
that,

[[Page 30575]]

together with its affiliates and controlling principals, has average 
gross revenues that are not more than $15 million for the preceding 
three years.\148\ Additionally, the lower 700 MHz Service had a third 
category of small business status 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.\149\ The SBA approved 
these small size standards.\150\ 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.\151\ 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.\152\ Seventeen winning bidders claimed small or very small 
business status and won 60 licenses, and nine winning bidders claimed 
entrepreneur status and won 154 licenses.\153\ On July 26, 2005, the 
Commission completed an auction of 5 licenses in the Lower 700 MHz band 
(Auction No. 60). There were three winning bidders for five licenses. 
All three winning bidders claimed small business status.
---------------------------------------------------------------------------

    \146\ See Reallocation and Service Rules for the 698-746 MHz 
Spectrum Band (Television Channels 52-59), Report and Order, 17 FCC 
Rcd 1022 (2002) (``Channels 52-59 Report and Order'').
    \147\ See Channels 52-59 Report and Order, 17 FCC Rcd at 1087-
88, para. 172.
    \148\ See id.
    \149\ See id, 17 FCC Rcd at 1088, para. 173.
    \150\ See Letter from Aida Alvarez, Administrator, SBA, to 
Thomas Sugrue, Chief, WTB, FCC (Aug. 10, 1999) (``Alvarez Letter 
1999'').
    \151\ See ``Lower 700 MHz Band Auction Closes,'' Public Notice, 
17 FCC Rcd 17272 (WTB 2002).
    \152\ See ``Lower 700 MHz Band Auction Closes,'' Public Notice, 
18 FCC Rcd 11873 (WTB 2003).
    \153\ See id.
---------------------------------------------------------------------------

    84. The Commission recently reexamined its rules governing the 700 
MHz band in the 700 MHz Second Report and Order.\154\ An auction of 700 
MHz licenses commenced January 24, 2008. For the Lower 700 MHz band, 
176 licenses over Economic Areas in the A Block, 734 licenses over 
Cellular Market Areas in the B Block, and 176 licenses over EAs in the 
E Block are available for licensing.\155\ Winning bidders may be 
eligible for small business status (those with attributable average 
annual gross revenues that exceed $15 million and do not exceed $40 
million for the preceding three years), or very small business status 
(those with attributable average annual gross revenues that do not 
exceed $15 million for the preceding three years).
---------------------------------------------------------------------------

    \154\ Service Rules for the 698-746, 747-762 and 777-792 MHz 
Bands, WT Docket No. 06-150, Revision of the Commission's Rules to 
Ensure Compatibility with Enhanced 911 Emergency Calling Systems, CC 
Docket No. 94-102, Section 68.4(a) of the Commission's Rules 
Governing Hearing Aid-Compatible Telephones, WT Docket No. 01-309, 
Biennial Regulatory Review--Amendment of Parts 1, 22, 24, 27, and 90 
to Streamline and Harmonize Various Rules Affecting Wireless Radio 
Services, WT Docket 03-264, Former Nextel Communications, Inc. Upper 
700 MHz Guard Band Licenses and Revisions to Part 27 of the 
Commission's Rules, WT Docket No. 06-169, Implementing a Nationwide, 
Broadband, Interoperable Public Safety Network in the 700 MHz Band, 
PS Docket No. 06-229, Development of Operational, Technical and 
Spectrum Requirements for Meeting Federal, State and Local Public 
Safety Communications Requirements Through the Year 2010, WT Docket 
No. 96-86, Second Report and Order, FCC 07-132 (2007) (``700 MHz 
Second Report and Order'').
    \155\ See ``Auction of 700 MHz Band Licenses Scheduled for 
January 16, 2008; Comment Sought on Competitive Bidding Procedures 
For Auction 73,'' Public Notice, FCC Rcd 15004 (WTB 2007).
---------------------------------------------------------------------------

    85. Upper 700 MHz Band Licenses. In the 700 MHz Second Report and 
Order, the Commission revised its rules regarding Upper 700 MHz 
licenses. On January 24, 2008, the Commission commenced Auction 73 in 
which several licenses in the Upper 700 MHz band are available for 
licensing: 12 licenses over Regional Economic Area Groupings 
(``REAGs'') in the C Block, and one nationwide license in the D 
Block.\156\ Winning bidders may be eligible for small business status 
(those with attributable average annual gross revenues that exceed $15 
million and do not exceed $40 million for the preceding three years), 
or very small business status (those with attributable average annual 
gross revenues that do not exceed $15 million for the preceding three 
years).
---------------------------------------------------------------------------

    \156\ See id.
---------------------------------------------------------------------------

    86. 700 MHz Guard Band Licenses. In the 700 MHz Guard Band Order, 
the Commission 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.\157\ 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.\158\ 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.\159\ SBA approval of these definitions is not 
required.\160\ An auction of 52 Major Economic Area (``MEA'') licenses 
commenced on September 6, 2000, and closed on September 21, 2000.\161\ 
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.\162\
---------------------------------------------------------------------------

    \157\ 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) (``746-764 MHz Band Second Report and Order'').
    \158\ See 746-764 MHz Band Second Report and Order, 15 FCC Rcd 
at 5343, para. 108.
    \159\ See id.
    \160\ See id., 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).
    \161\ See ``700 MHz Guard Bands Auction Closes: Winning Bidders 
Announced,'' Public Notice, 15 FCC Rcd 18026 (2000).
    \162\ See ``700 MHz Guard Bands Auction Closes: Winning Bidders 
Announced,'' Public Notice, 16 FCC Rcd 4590 (WTB 2001).
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    87. 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.\163\ 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.\164\ The SBA has approved 
these small business size standards for the 900 MHz Service.\165\ 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.\166\ A second auction for the 800

[[Page 30576]]

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.\167\
---------------------------------------------------------------------------

    \163\ 47 CFR 90.814(b)(1).
    \164\ 47 CFR 90.814(b)(1).
    \165\ See Alvarez Letter 1999.
    \166\ 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).
    \167\ See ``Multi-Radio Service Auction Closes,'' Public Notice, 
17 FCC Rcd 1446 (WTB 2002).
---------------------------------------------------------------------------

    88. 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.\168\ 
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 
awarded.\169\ 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.
---------------------------------------------------------------------------

    \168\ 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).
    \169\ See ``800 MHz SMR Service Lower 80 Channels Auction 
Closes; Winning Bidders Announced,'' Public Notice, 16 FCC Rcd 1736 
(2000).
---------------------------------------------------------------------------

    89. 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.
    90. 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.\170\ The Commission estimates that most such licensees are 
small businesses under the SBA's small business standard.
---------------------------------------------------------------------------

    \170\ 13 CFR 121.201, NAICS code 517212.
---------------------------------------------------------------------------

    91. 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, the Commission 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.\171\ 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.\172\ 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.\173\ The SBA has approved these small size standards.\174\ 
Auctions of Phase II licenses commenced on September 15, 1998, and 
closed on October 22, 1998.\175\ 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.\176\ 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.\177\ 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.\178\ The Commission conducted a fourth auction in 2007 with 
three of the five winning bidders claiming small or very small business 
status.\179\
---------------------------------------------------------------------------

    \171\ 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).
    \172\ Id. at 11068, para. 291.
    \173\ Id.
    \174\ See Letter from Aida Alvarez, Administrator, SBA, to 
Daniel Phythyon, Chief, WTB, FCC (Jan. 6, 1998) (``Alvarez to 
Phythyon Letter 1998'').
    \175\ See generally ``220 MHz Service Auction Closes,'' Public 
Notice, 14 FCC Rcd 605 (1998).
    \176\ 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 (1999).
    \177\ See ``Phase II 220 MHz Service Spectrum Auction Closes,'' 
Public Notice, 14 FCC Rcd 11218 (1999).
    \178\ See ``Multi-Radio Service Auction Closes,'' Public Notice, 
17 FCC Rcd 1446 (2002).
    \179\ See ``Auction of Phase II 220 MHz Service Spectrum 
Licenses Closes,'' Public Notice, 22 FCC Rcd 11573 (WTB 2007).
---------------------------------------------------------------------------

    92. 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 use the broad 
census category, ``Cellular and Other Wireless Telecommunications.'' 
This definition provides that a small entity is any such entity 
employing no more than 1,500 persons.\180\ 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. We note that PLMR licensees generally use the 
licensed facilities in support of other business activities, and 
therefore, it would also be helpful to assess PLMR licensees under the 
standards applied to the particular industry subsector to which the 
licensee belongs.\181\
---------------------------------------------------------------------------

    \180\ See 13 CFR 121.201, NAICS code 517212.
    \181\ See generally 13 CFR 121.201.
---------------------------------------------------------------------------

    93. The Commission's 1994 Annual Report on PLMRs \182\ 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. We 
note that any entity engaged in a commercial activity is eligible to 
hold a PLMR license, and that the revised rules in this context could 
therefore potentially impact small entities covering a great variety of 
industries.
---------------------------------------------------------------------------

    \182\ Federal Communications Commission, 60th Annual Report, 
Fiscal Year 1994, at para. 116.
---------------------------------------------------------------------------

    94. Fixed Microwave Services. Fixed microwave services include 
common carrier,\183\ private operational-fixed,\184\

[[Page 30577]]

and broadcast auxiliary radio services.\185\ 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.\186\ The 
Commission does not have data specifying the number of these licensees 
that have no 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 22,015 or fewer common carrier fixed licensees 
and 61,670 or fewer 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 note, 
however, that the common carrier microwave fixed licensee category 
includes some large entities.
---------------------------------------------------------------------------

    \183\ See 47 CFR 101 et seq. (formerly, Part 21 of the 
Commission's Rules) for common carrier fixed microwave services 
(except Multipoint Distribution Service).
    \184\ 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.
    \185\ 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.
    \186\ 13 CFR 121.201, NAICS code 517212.
---------------------------------------------------------------------------

    95. 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.\187\ 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.\188\ 
The SBA has approved these small business size standards.\189\ The 
auction of the 2,173 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.
---------------------------------------------------------------------------

    \187\ 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).
    \188\ Id.
    \189\ See Letter from Aida Alvarez, Administrator, SBA, to 
Kathleen O'Brien Ham, Chief, Auctions and Industry Analysis 
Division, WTB, FCC (Feb. 4, 1998); See Letter from Hector Barreto, 
Administrator, SBA, to Margaret Wiener, Chief, Auctions and Industry 
Analysis Division, WTB, FCC (Jan. 18, 2002).
---------------------------------------------------------------------------

    96. 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.\190\ The auction of the 986 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.\191\ 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.\192\ The SBA 
has approved these small business size standards in the context of LMDS 
auctions.\193\ 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 businesses winning that won 119 
licenses.
---------------------------------------------------------------------------

    \190\ 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) (``LMDS Second Report and 
Order'').
    \191\ See LMDS Second Report and Order, 12 FCC Rcd at 12689-90, 
para. 348.
    \192\ See id.
    \193\ See Alvarez to Phythyon Letter 1998.
---------------------------------------------------------------------------

    97. 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'').\194\ Of the 594 licenses, 
567 were won by 167 entities qualifying as a small business. For that 
auction, the Commission 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.\195\ 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.\196\ 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.\197\ The SBA has approved of these definitions.\198\ A 
subsequent auction is not yet scheduled. Given the success of small 
businesses in the 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 most, of the licenses may be 
awarded to small businesses.
---------------------------------------------------------------------------

    \194\ See ``Interactive Video and Data Service (IVDS) 
Applications Accepted for Filing,'' Public Notice, 9 FCC Rcd 6227 
(1994).
    \195\ Implementation of Section 309(j) of the Communications 
Act--Competitive Bidding, Fourth Report and Order, 9 FCC Rcd 2330 
(1994).
    \196\ 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).
    \197\ Id.
    \198\ See Alvarez to Phythyon Letter 1998.
---------------------------------------------------------------------------

    98. 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.\199\ 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.\200\ These definitions have been approved by the SBA.\201\ An 
auction for LMS licenses commenced on February 23, 1999, and closed on 
March 5, 1999. Of the 528 licenses auctioned,

[[Page 30578]]

289 licenses were sold to four small businesses.
---------------------------------------------------------------------------

    \199\ 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) (``Automatic 
Vehicle Monitoring Systems Second Report and Order''); see also 47 
CFR 90.1103.
    \200\ Automatic Vehicle Monitoring Systems Second Report and 
Order, 13 FCC Rcd at 15192, para. 20; see also 47 CFR 90.1103.
    \201\ See Alvarez Letter 1998.
---------------------------------------------------------------------------

    99. Rural Radiotelephone Service. The Commission has not adopted a 
size standard for small businesses specific to the Rural Radiotelephone 
Service.\202\ A significant subset of the Rural Radiotelephone Service 
is the Basic Exchange Telephone Radio System (``BETRS'').\203\ In the 
present context, we will use 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.\204\ 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.
---------------------------------------------------------------------------

    \202\ The service is defined in section 22.99 of the 
Commission's Rules, 47 CFR 22.99.
    \203\ BETRS is defined in section 22.757 and 22.759 of the 
Commission's Rules, 47 CFR 22.757 and 22.759.
    \204\ 13 CFR 121.201, NAICS code 517212.
---------------------------------------------------------------------------

    100. Air-Ground Radiotelephone Service.\205\ The Commission has 
previously used the SBA's small business definition applicable to 
``Cellular and Other Wireless Telecommunications,'' i.e., an entity 
employing no more than 1,500 persons.\206\ There are approximately 100 
licensees in the Air-Ground Radiotelephone Service, and under that 
definition, we estimate that almost all of them qualify as small 
entities under the SBA definition. For purposes of assigning Air-Ground 
Radiotelephone Service licenses through competitive bidding, 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 $40 million.\207\ 
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 $15 million.\208\ These 
definitions were approved by the SBA.\209\ In May 2006, the Commission 
completed an auction of nationwide commercial Air-Ground Radiotelephone 
Service licenses in the 800 MHz band (Auction No. 65). On June 2, 2006, 
the auction closed with two winning bidders winning two Air-Ground 
Radiotelephone Services licenses. Neither of the winning bidders 
claimed small business status.
---------------------------------------------------------------------------

    \205\ The service is defined in section 22.99 of the 
Commission's Rules, 47 CFR 22.99.
    \206\ 13 CFR 121.201, NAICS codes 517212.
    \207\ Amendment of Part 22 of the Commission's Rules to Benefit 
the Consumers of Air-Ground Telecommunications Services, Biennial 
Regulatory Review--Amendment of Parts 1, 22, and 90 of the 
Commission's Rules, Amendment of Parts 1 and 22 of the Commission's 
Rules to Adopt Competitive Bidding Rules for Commercial and General 
Aviation Air-Ground Radiotelephone Service, WT Docket Nos. 03-103 
and 05-42, Order on Reconsideration and Report and Order, 20 FCC Rcd 
19663, para. 28-42 (2005).
    \208\ Id.
    \209\ See Letter from Hector V. Barreto, Administrator, SBA, to 
Gary D. Michaels, Deputy Chief, Auctions and Spectrum Access 
Division, WTB, FCC (Sept. 19, 2005).
---------------------------------------------------------------------------

    101. Aviation and Marine Radio Services. There are approximately 
26,162 aviation, 34,555 marine (ship), and 3,296 marine (coast) 
licensees.\210\ The Commission has not developed a small business size 
standard specifically applicable to all licensees. For purposes of this 
analysis, we will use the SBA small business size standard for the 
category ``Cellular and Other Telecommunications,'' which is 1,500 or 
fewer employees.\211\ We are unable to determine how many of those 
licensed fall under this standard. For purposes of our evaluations in 
this analysis, we estimate that there are up to approximately 62,969 
licensees that are small businesses under the SBA standard.\212\ In 
December 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 this 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. 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.\213\ Further, the Commission made 
available Automated Maritime Telecommunications System (``AMTS'') 
licenses in Auctions 57 and 61.\214\ Winning bidders could claim status 
as a very small business or a very small business. A very small 
business for this service is defined as an entity with attributed 
average annual gross revenues that do not exceed $3 million for the 
preceding three years, and a small business is defined as an entity 
with attributed average annual gross revenues of more than $3 million 
but less than $15 million for the preceding three years.\215\ Three of 
the winning bidders in Auction 57 qualified as small or very small 
businesses, while three winning entities in Auction 61 qualified as 
very small businesses.
---------------------------------------------------------------------------

    \210\ Vessels that are not required by law to carry a radio and 
do not make international voyages or communications are not required 
to obtain an individual license. See Amendment of Parts 80 and 87 of 
the Commission's Rules to Permit Operation of Certain Domestic Ship 
and Aircraft Radio Stations Without Individual Licenses, Report and 
Order, WT Docket No. 96-82, 11 FCC Rcd 14849 (1996).
    \211\ 13 CFR 121.201, NAICS code 517212.
    \212\ A licensee may have a license in more than one category.
    \213\ 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).
    \214\ See ``Automated Maritime Telecommunications System 
Spectrum Auction Scheduled for September 15, 2004, Notice and Filing 
Requirements, Minimum Opening Bids, Upfront Payments and Other 
Auction Procedures,'' Public Notice, 19 FCC Rcd 9518 (WTB 2004); 
``Auction of Automated Maritime Telecommunications System Licenses 
Scheduled for August 3, 2005, Notice and Filing Requirements, 
Minimum Opening Bids, Upfront Payments and Other Auction Procedures 
for Auction No. 61,'' Public Notice, 20 FCC Rcd 7811 (WTB 2005).
    \215\ 47 CFR 80.1252.
---------------------------------------------------------------------------

    102. 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.\216\ There is presently 1 licensee 
in this service. We do not have information whether that licensee would 
qualify as small under the SBA's small business size standard for 
``Cellular and Other Wireless Telecommunications'' services.\217\ Under 
that SBA small business size standard, a business is small if it has 
1,500 or fewer employees.\218\
---------------------------------------------------------------------------

    \216\ This service is governed by Subpart I of Part 22 of the 
Commission's Rules. See 47 CFR 22.1001-22.1037.
    \217\ 13 CFR 121.201, NAICS code 517212.
    \218\ Id.
---------------------------------------------------------------------------

    103. 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.\219\ ``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.\220\ The SBA has approved of these definitions.\221\ The 
majority of these entities will most likely be licensed in bands where 
the Commission has

[[Page 30579]]

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.\222\ Seven winning bidders claimed status as small or very small 
businesses and won 611 licenses. On May 18, 2005, the Commission 
completed an auction (Auction No. 59) of 4,226 MAS licenses in the 
Fixed Microwave Services from the 928/959 and 932/941 MHz bands. 
Twenty-six winning bidders won a total of 2,323 licenses. Of the 26 
winning bidders in this auction, five claimed small business status and 
won 1,891 licenses.
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    \219\ See Amendment of the Commission's Rules Regarding Multiple 
Address Systems, Report and Order, 15 FCC Rcd 11956, 12008, para. 
123 (2000).
    \220\ Id.
    \221\ See Alvarez Letter 1999.
    \222\ See ``Multiple Address Systems Spectrum Auction Closes,'' 
Public Notice, 16 FCC Rcd 21011 (2001).
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    104. 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 small 
business size standard developed by the SBA would be more appropriate. 
The applicable size standard in this instance appears to be that of 
``Cellular and Other Wireless Telecommunications''. This definition 
provides that a small entity is any such entity employing no more than 
1,500 persons.\223\ 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.
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    \223\ See 13 CFR 121.201, NAICS code 517212.
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    105. 1.4 GHz Band Licensees. The Commission conducted an auction of 
64 1.4 GHz band licenses, beginning on February 7, 2007,\224\ and 
closing on March 8, 2007.\225\ In that auction, the Commission defined 
``small business'' as an entity that, together with its affiliates and 
controlling interests, had average gross revenues that exceed $15 
million but do not exceed $40 million for the preceding three years, 
and a ``very small business'' as an entity that, together with its 
affiliates and controlling interests, has had average annual gross 
revenues not exceeding $15 million for the preceding three years.\226\ 
Neither of the two winning bidders sought designated entity 
status.\227\
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    \224\ See ``Auction of 1.4 GHz Bands Licenses Scheduled for 
February 7, 2007,'' Public Notice, 21 FCC Rcd 12393 (WTB 2006).
    \225\ See ``Auction of 1.4 GHz Band Licenses Closes; Winning 
Bidders Announced for Auction No. 69,'' Public Notice, 22 FCC Rcd 
4714 (2007) (``Auction No. 69 Closing PN'').
    \226\ Id., Attachment C.
    \227\ See Auction No. 69 Closing PN.
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    106. 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.\228\ For the census category of Paging, Census Bureau data for 
2002 show that there were 807 firms in this category that operated for 
the entire year.\229\ Of this total, 804 firms had employment of 999 or 
fewer employees, and three firms had employment of 1,000 employees or 
more.\230\ Thus, under this category and associated small business size 
standard, the majority of firms can be considered small. For the census 
category of Cellular and Other Wireless Telecommunications, Census 
Bureau data for 2002 show that there were 1,397 firms in this category 
that operated for the entire year.\231\ Of this total, 1,378 firms had 
employment of 999 or fewer employees, and 19 firms had employment of 
1,000 employees or more.\232\ Thus, under this second category and size 
standard, the majority of firms can, again, 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 \233\ and TRW, Inc. It is our understanding that Teligent and 
its related companies have fewer than 1,500 employees, though this may 
change in the future. TRW is not a small entity. There are 
approximately 122 licensees in the Rural Radiotelephone Service, and 
the Commission estimates that there are 122 or fewer small entity 
licensees in the Rural Radiotelephone Service that may be affected by 
the rules and policies proposed herein.
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    \228\ 13 CFR 121.201, NAICS code 517212.
    \229\ U.S. Census Bureau, 2002 Economic Census, Subject Series: 
Information, ``Establishment and Firm Size (Including Legal Form of 
Organization,'' Table 5, NAICS code 517211.
    \230\ 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 for firms with ``1000 
employees or more.''
    \231\ U.S. Census Bureau, 2002 Economic Census, Subject Series: 
Information, ``Establishment and Firm Size (Including Legal Form of 
Organization,'' Table 5, NAICS code 517212.
    \232\ 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 for firms with ``1000 
employees or more.''
    \233\ 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.
---------------------------------------------------------------------------

    107. 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.\234\ ``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.\235\ The SBA has approved these definitions.\236\ 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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    \234\ 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).
    \235\ 24 GHz Report and Order, 15 FCC Rcd at 16967, para. 77; 
see also 47 CFR 101.538(a)(1).
    \236\ See Letter from Gary M. Jackson, Assistant Administrator, 
SBA, to Margaret W. Wiener, Deputy Chief, Auctions and Industry 
Analysis Division, WTB, FCC (July 28, 2000).
---------------------------------------------------------------------------

    108. Broadband Radio Service. Broadband Radio Service systems, 
previously referred to as Multipoint Distribution Service (``MDS'') and 
Multichannel Multipoint Distribution Service (``MMDS'') systems, and 
``wireless cable,'' transmit video programming to subscribers and 
provide two-way high speed data operations using the microwave 
frequencies of the Broadband Radio Service (``BRS'') and Educational 
Broadband Service (``EBS'') (previously referred to as the 
Instructional Television Fixed Service (``ITFS'')).\237\ In connection 
with the 1996 BRS auction, the Commission established a small business 
size

[[Page 30580]]

standard as an entity that had annual average gross revenues of no more 
than $40 million in the previous three calendar years.\238\ The BRS 
auctions resulted in 67 successful bidders obtaining licensing 
opportunities for 493 Basic Trading Areas (``BTAs''). Of the 67 auction 
winners, 61 met the definition of a small business. BRS also includes 
licensees of stations authorized prior to the auction. At this time, we 
estimate that of the 61 small business BRS auction winners, 48 remain 
small business licensees. In addition to the 48 small businesses that 
hold BTA authorizations, there are approximately 392 incumbent BRS 
licensees that are considered small entities.\239\ After adding the 
number of small business auction licensees to the number of incumbent 
licensees not already counted, we find that there are currently 
approximately 440 BRS licensees that are defined as small businesses 
under either the SBA or the Commission's rules.
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    \237\ 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, MM Docket No. 94-131 and PP Docket No. 93-253, 
Report and Order, 10 FCC Rcd 9589, 9593, para. 7 (1995) (``MDS 
Auction R&O'').
    \238\ 47 CFR 21.961(b)(1).
    \239\ 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.
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    109. In addition, the SBA has developed a small business size 
standard for Cable and Other Program Distribution, which includes all 
such companies generating $13.5 million or less in annual 
receipts.\240\ According to Census Bureau data for 2002, there were a 
total of 1,191 firms in this category that operated for the entire 
year.\241\ Of this total, 1,087 firms had annual receipts of under $10 
million, and 43 firms had receipts of $10 million or more but less than 
$25 million.\242\ Consequently, we estimate that the majority of 
providers in this service category are small businesses that may be 
affected by the rules and policies adopted herein. This SBA small 
business size standard is applicable to EBS. There are presently 2,032 
EBS licensees. All but 100 of these licenses are held by educational 
institutions. Educational institutions are included in this analysis as 
small entities.\243\ Thus, we estimate that at least 1,932 licensees 
are small businesses.
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    \240\ 13 CFR 121.201, NAICS code 517510.
    \241\ U.S. Census Bureau, 2002 Economic Census, Subject Series: 
Information, Table 4, Receipts Size of Firms for the United States: 
2002, NAICS code 517510.
    \242\ Id. An additional 61 firms had annual receipts of $25 
million or more.
    \243\ The term ``small entity'' within 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 EBS licensees.
---------------------------------------------------------------------------

    110. Television Broadcasting. The Census Bureau defines this 
category as follows: ``This industry comprises establishments primarily 
engaged in broadcasting images together with sound. These 
establishments operate television broadcasting studios and facilities 
for the programming and transmission of programs to the public.'' \244\ 
The SBA has created a small business size standard for Television 
Broadcasting entities, which is: such firms having $13 million or less 
in annual receipts.\245\ According to Commission staff review of the 
BIA Financial Network, Inc., Media Access Pro Television Database as of 
December 7, 2007, about 825 (66 percent) of the 1,250 commercial 
television stations in the United States have revenues of $13 million 
or less. However, in assessing whether a business entity qualifies as 
small under the above definition, business controlaffiliations \246\ 
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.
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    \244\ U.S. Census Bureau, 2002 NAICS Definitions, ``515120 
Television Broadcasting'' (partial definition); http://www.census.gov/epcd/naics02/def/NDEF515.HTM.
    \245\ 13 CFR 121.201, NAICS code 515120.
    \246\ ``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 
21.103(a)(1).
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    111. 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 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.
    112. There are also 2,117 low power television stations 
(``LPTV'').\247\ Given the nature of this service, we will presume that 
all LPTV licensees qualify as small entities under the above SBA small 
business size standard.
---------------------------------------------------------------------------

    \247\ FCC News Release, ``Broadcast Station Totals as of 
September 30, 2007.''
---------------------------------------------------------------------------

    113. Radio Broadcasting. The SBA defines a radio broadcast entity 
that has $6 million or less in annual receipts as a small 
business.\248\ Business concerns included in this industry are those 
``primarily engaged in broadcasting aural programs by radio to the 
public.\249\ 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 \250\ are included.\251\ Our estimate, therefore 
likely overstates the number of small businesses that might be affected 
by our action.
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    \248\ See OMB, North American Industry Classification System: 
United States, 1997, at 509 (1997) (Radio Stations) (NAICS code 
515112).
    \249\ Id.
    \250\ ``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).
    \251\ ``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).
---------------------------------------------------------------------------

    114. 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.\252\
---------------------------------------------------------------------------

    \252\ 13 CFR 121.201, NAICS codes 513111 and 513112.
---------------------------------------------------------------------------

    115. The Commission estimates that there are approximately 5,618 FM 
translators and boosters.\253\ 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

[[Page 30581]]

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 ($6.5 million for a radio station or $13.0 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.\254\
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    \253\ See supra note 242.
    \254\ 15 U.S.C. 632.
---------------------------------------------------------------------------

    116. Cable and Other Program Distribution. The Census Bureau 
defines this category as follows: ``This industry comprises 
establishments primarily engaged as third-party distribution systems 
for broadcast programming. The establishments of this industry deliver 
visual, aural, or textual programming received from cable networks, 
local television stations, or radio networks to consumers via cable or 
direct-to-home satellite systems on a subscription or fee basis. These 
establishments do not generally originate programming material.'' \255\ 
The SBA has developed a small business size standard for Cable and 
Other Program Distribution, which is: All such firms having $13.5 
million or less in annual receipts.\256\ According to Census Bureau 
data for 2002, there were a total of 1,191 firms in this category that 
operated for the entire year.\257\ Of this total, 1,087 firms had 
annual receipts of under $10 million, and 43 firms had receipts of $10 
million or more but less than $25 million.\258\ Thus, under this size 
standard, the majority of firms can be considered small.
---------------------------------------------------------------------------

    \255\ U.S. Census Bureau, 2002 NAICS Definitions, ``517510 Cable 
and Other Program Distribution''; http://www.census.gov/epcd/naics02/def/NDEF517.HTM.
    \256\ 256 13 CFR 121.201, NAICS code 517510.
    \257\ U.S. Census Bureau, 2002 Economic Census, Subject Series: 
Information, Table 4, Receipts Size of Firms for the United States: 
2002, NAICS code 517510.
    \258\ Id. An additional 61 firms had annual receipts of $25 
million or more.
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    117. Cable Companies and Systems. The Commission has also developed 
its own small business size standards, for the purpose of cable rate 
regulation. Under the Commission's rules, a ``small cable company'' is 
one serving 400,000 or fewer subscribers, nationwide.\259\ Industry 
data indicate that, of 1,076 cable operators nationwide, all but eleven 
are small under this size standard.\260\ In addition, under the 
Commission's rules, a ``small system'' is a cable system serving 15,000 
or fewer subscribers.\261\ Industry data indicate that, of 7,208 
systems nationwide, 6,139 systems have under 10,000 subscribers, and an 
additional 379 systems have 10,000-19,999 subscribers.\262\ Thus, under 
this second size standard, most cable systems are small.
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    \259\ 47 CFR 76.901(e). The Commission determined that this size 
standard equates approximately to a size standard of $100 million or 
less in annual revenues. Implementation of Sections of the 1992 
Cable Act: Rate Regulation, Sixth Report and Order and Eleventh 
Order on Reconsideration, 10 FCC Rcd 7393, 7408 (1995).
    \260\ These data are derived from: R.R. Bowker, Broadcasting & 
Cable Yearbook 2006, ``Top 25 Cable/Satellite Operators,'' pages A-8 
& C-2; Warren Communications News, Television & Cable Factbook 2006, 
``Ownership of Cable Systems in the United States,'' pages D-1805 to 
D-1857.
    \261\ 47 CFR 76.901(c).
    \262\ Warren Communications News, Television & Cable Factbook 
2006, ``U.S. Cable Systems by Subscriber Size,'' page F-2. The data 
do not include 718 systems for which classifying data were not 
available.
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    118. Cable System Operators. 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.'' \263\ The Commission has determined that an operator 
serving fewer than 677,000 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.\264\ Industry data indicate that, of 1,076 cable operators 
nationwide, all but ten are small under this size standard.\265\ We 
note that the Commission neither requests nor collects information on 
whether cable system operators are affiliated with entities whose gross 
annual revenues exceed $250 million,\266\ and therefore we are unable 
to estimate more accurately the number of cable system operators that 
would qualify as small under this size standard.
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    \263\ 47 U.S.C. 543(m)(2); see 47 CFR 76.901(f) & nn. 1-3.
    \264\ 47 CFR 76.901(f); see Public Notice, FCC Announces New 
Subscriber Count for the Definition of Small Cable Operator, 16 FCC 
Rcd 2225 (Cable Services Bureau, 2001).
    \265\ These data are derived from: R.R. Bowker, Broadcasting & 
Cable Yearbook 2006, ``Top 25 Cable/Satellite Operators,'' pages A-8 
& C-2 (data current as of June 30, 2005); Warren Communications 
News, Television & Cable Factbook 2006, ``Ownership of Cable Systems 
in the United States,'' pages D-1805 to D-1857.
    \266\ 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).
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    119. Open Video Services. Open Video Service (``OVS'') systems 
provide subscription services.\267\ The SBA has created a small 
business size standard for Cable and Other Program Distribution.\268\ 
This standard provides that a small entity is one with $13.5 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.\269\ 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 proposed herein.
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    \267\ See 47 U.S.C. 573.
    \268\ 13 CFR 121.201, NAICS code 517510.
    \269\ See http://www.fcc.gov/csb/ovs/csovscer.html.
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    120. Cable Television Relay Service. This service includes 
transmitters generally used to relay cable programming within cable 
television system distribution systems. The SBA has developed a small 
business size standard for Cable and Other Program Distribution, which 
is: All such firms having $13.5 million or less in annual 
receipts.\270\ According to Census Bureau data for 2002, there were a 
total of 1,191 firms in this category that operated for the entire 
year.\271\ Of this total, 1,087 firms had annual receipts of under $10 
million, and 43 firms had receipts of $10 million or more but less than 
$25 million.\272\ Thus, under this size standard, the majority of firms 
can be considered small.
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    \270\ 13 CFR 121.201, NAICS code 517510.
    \271\ U.S. Census Bureau, 2002 Economic Census, Subject Series: 
Information, Table 4, Receipts Size of Firms for the United States: 
2002, NAICS code 517510.
    \272\ Id. An additional 61 firms had annual receipts of $25 
million or more.
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    121. Multichannel Video Distribution and Data Service. MVDDS is a 
terrestrial fixed microwave service operating in the 12.2-12.7 GHz 
band. The Commission adopted criteria for defining three groups of 
small businesses for purposes of determining their eligibility for 
special provisions such as bidding credits. It defined a very

[[Page 30582]]

small business as an entity with average annual gross revenues not 
exceeding $3 million for the preceding three years; a small business as 
an entity with average annual gross revenues not exceeding $15 million 
for the preceding three years; and an entrepreneur as an entity with 
average annual gross revenues not exceeding $40 million for the 
preceding three years.\273\ These definitions were approved by the 
SBA.\274\ On January 27, 2004, the Commission completed an auction of 
214 MVDDS licenses (Auction No. 53). In this auction, ten winning 
bidders won a total of 192 MVDDS licenses.\275\ Eight of the ten 
winning bidders claimed small business status and won 144 of the 
licenses. The Commission also held an auction of MVDDS licenses on 
December 7, 2005 (Auction 63). Of the three winning bidders who won 22 
licenses, two winning bidders, winning 21 of the licenses, claimed 
small business status.\276\
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    \273\ Amendment of Parts 2 and 25 of the Commission's Rules to 
Permit Operation of NGSO FSS Systems Co-Frequency with GSO and 
Terrestrial Systems in the Ku-Band Frequency Range; Amendment of the 
Commission's Rules to Authorize Subsidiary Terrestrial Use of the 
12.2-12.7 GHz Band by Direct Broadcast Satellite Licenses and their 
Affiliates; and Applications of Broadwave USA, PDC Broadband 
Corporation, and Satellite Receivers, Ltd. to provide A Fixed 
Service in the 12.2-12.7 GHz Band, ET Docket No. 98-206, Memorandum 
Opinion and Order and Second Report and Order, 17 FCC Rcd 9614, 
9711, para. 252 (2002).
    \274\ See Letter from Hector V. Barreto, Administrator, U.S. 
Small Business Administration, to Margaret W. Wiener, Chief, 
Auctions and Industry Analysis Division, WTB, FCC (Feb.13, 2002).
    \275\ See ``Multichannel Video Distribution and Data Service 
Auction Closes,'' Public Notice, 19 FCC Rcd 1834 (2004).
    \276\ See ``Auction of Multichannel Video Distribution and Data 
Service Licenses Closes; Winning Bidders Announced for Auction No. 
63,'' Public Notice, 20 FCC Rcd 19807 (2005).
---------------------------------------------------------------------------

    122. Amateur Radio Service. These licensees are held by individuals 
in a noncommercial capacity; these licensees are not small entities.
    123. 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.\277\ 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.\278\ 
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.
---------------------------------------------------------------------------

    \277\ 13 CFR 121.201, NAICS code 517212.
    \278\ Amendment of the Commission's Rules Concerning Maritime 
Communications, Third Report and Order and Memorandum Opinion and 
Order, 13 FCC Rcd 19853 (1998).
---------------------------------------------------------------------------

    124. 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.\279\ 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'').\280\ 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 the 
rules being proposed. 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.\281\ 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 the proposed rules.
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    \279\ 47 CFR Part 90.
    \280\ 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.
    \281\ 13 CFR 121.201, NAICS Code 517212.
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    125. Public Safety Radio Services. Public Safety radio services 
include police, fire, local government, forestry conservation, highway 
maintenance, and emergency medical services.\282\ There are a total of 
approximately 127,540 licensees in these services. Governmental 
entities \283\ 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.\284\
---------------------------------------------------------------------------

    \282\ 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.
    \283\ 47 CFR 1.1162.
    \284\ 5 U.S.C. 601(5).

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[[Page 30583]]

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

    126. 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 Remittance 
Advice, and pay a regulatory fee based on the number of licenses or 
call signs.\285\ 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.
---------------------------------------------------------------------------

    \285\ See 47 CFR 1.1162 for the general exemptions from 
regulatory fees. E.g., 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.
---------------------------------------------------------------------------

    127. 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.
    128. 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.\286\ If payment is not received, new or 
pending applications may be dismissed, and existing authorizations may 
be subject to rescission.\287\ Further, in accordance with the DCIA, 
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.\288\ Nonpayment of 
regulatory fees is a debt owed the United States pursuant to 31 U.S.C. 
3711 et seq. and the DCIA. 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.\289\
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    \286\ 47 CFR 1.1164.
    \287\ 47 CFR 1.1164(c).
    \288\ Public Law 104-134, 110 Stat. 1321 (1996).
    \289\ 31 U.S.C. 7701(c)(2)(B).
---------------------------------------------------------------------------

    129. 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.\290\ 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.
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    \290\ 47 CFR 1.1166.
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V. Steps Taken To Minimize Significant Economic Impact on Small 
Entities, and Significant Alternatives Considered

    130. 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.\291\ In the NPRM, we have sought comment on alternatives that 
might simplify our fee procedures or otherwise benefit filers, 
including small entities, while remaining consistent with our statutory 
responsibilities in this proceeding.
---------------------------------------------------------------------------

    \291\ 5 U.S.C. 603.
---------------------------------------------------------------------------

    131. Several categories of licensees and regulatees are exempt from 
payment of regulatory fees. Also, waiver procedures provide regulatees, 
including small entity regulatees, relief in exceptional circumstances.

VI. Federal Rules That May Duplicate, Overlap, or Conflict With the 
Proposed Rules

    132. None.

Attachment B--Sources of Payment Unit Estimates for FY 2008

    In order to calculate individual service fees for FY 2008, we 
adjusted FY 2007 payment units for each service to more accurately 
reflect expected FY 2008 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 our Universal Licensing System (``ULS''), 
International Bureau Filing System (``IBFS''), Consolidated Database 
System (``CDBS'') and Cable Operations and Licensing System 
(``COALS''), 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 2008 estimates with actual FY 
2007 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

[[Page 30584]]

number of waivers and/or exemptions that may occur in FY 2008 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. When we note, for example, that our estimated FY 2008 
payment units are based on FY 2007 actual payment units, it does not 
necessarily mean that our FY 2008 projection is exactly the same number 
as FY 2007. We have either rounded the FY 2008 number or adjusted it 
slightly to account for these variables.

------------------------------------------------------------------------
             Fee category              Sources of payment unit estimates
------------------------------------------------------------------------
Land Mobile (All), Microwave, 218-219  Based on Wireless
 MHz, Marine (Ship & Coast), Aviation   Telecommunications Bureau
 (Aircraft & Ground), GMRS, Amateur     (``WTB'') projections of new
 Vanity Call Signs, Domestic Public     applications and renewals taking
 Fixed.                                 into consideration existing
                                        Commission licensee data bases.
                                        Aviation (Aircraft) 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 WTB projection reports,
                                        and FY 07 payment data.
CMRS Messaging Services..............  Based on WTB reports, and FY 07
                                        payment data.
AM/FM Radio Stations.................  Based on CDBS data, adjusted for
                                        exemptions, and actual FY 2007
                                        payment units.
UHF/VHF Television Stations..........  Based on CDBS data, adjusted for
                                        exemptions, and actual FY 2007
                                        payment units.
AM/FM/TV Construction Permits........  Based on CDBS data, adjusted for
                                        exemptions, and actual FY 2007
                                        payment units.
LPTV, Translators and Boosters, Class  Based on CDBS data, adjusted for
 A Television.                          exemptions, and actual FY 2007
                                        payment units.
Broadcast Auxiliaries................  Based on actual FY 2007 payment
                                        units.
BRS (formerly MDS/MMDS)..............  Based on WTB reports and actual
                                        FY 2007 payment units.
Cable Television Relay Service         Based on data from Media Bureau's
 (``CARS'') Stations.                   COALS database and actual FY
                                        2007 payment units.
Cable Television System Subscribers..  Based on publicly available data
                                        sources for estimated subscriber
                                        counts and actual FY 2007
                                        payment units.
Interstate Telecommunication Service   Based on FCC Form 499-Q data for
 Providers.                             the four quarters of calendar
                                        year 2007, the Wireline
                                        Competition Bureau projected the
                                        amount of calendar year 2007
                                        revenue that will be reported on
                                        2008 FCC Form 499-A worksheets
                                        in April, 2008.
Earth Stations.......................  Based on International Bureau
                                        (``IB'') licensing data and
                                        actual FY 2007 payment units.
Space Stations (GSOs & NGSOs)........  Based on IB data reports and
                                        actual FY 2007 payment units.
International Bearer Circuits........  Based on IB reports and actual FY
                                        2007 payment units.
International HF Broadcast Stations,   Based on IB reports and actual FY
 International Public Fixed Radio       2007 payment units.
 Service.
------------------------------------------------------------------------

Attachment C--Calculation of FY2008 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.
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[[Page 30586]]


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[[Page 30587]]


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Attachment D--Proposed FY 2008 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.

[[Page 30588]]

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[[Page 30589]]


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[[Page 30590]]

FY 2008 Schedule of Regulatory Fees (continued)

                                      FY 2008 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,
                                                                                         A, B1 & C3    C1 & C2
----------------------------------------------------------------------------------------------------------------
<=25,000..........................         $650         $500         $450         $525         $600         $775
25,001-75,000.....................        1,325        1,025          650          775        1,225        1,375
75,001-150,000....................        1,975        1,275          875        1,300        1,675        2,550
150,001-500,000...................        2,975        2,175        1,325        1,550        2,600        3,325
500,001-1,200,000.................        4,300        3,325        2,200        2,575        4,125        4,900
1,200,001-3,000,00................        6,600        5,100        3,300        4,125        6,700        7,850
>3,000,000........................        7,925        6,125        4,175        5,150        8,550       10,200
----------------------------------------------------------------------------------------------------------------

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 section73.150 and 
73.152 of the Commission's rules.\292\ 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 \293\. Using the calculated horizontal 
radiation values, and the retrieved soil conductivity data, the 
distance to the principal community (5 mV/m) contour was predicted for 
each of the 360 radials. The resulting distance to principal community 
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 principal community 
coverage area.
---------------------------------------------------------------------------

    \292\ 47 CFR 73.150 and 73.152.
    \293\ 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 73.313 of the Commission's rules to predict 
the distance to the principal community (70 dBu (decibel above 1 
microVolt per meter) or 3.17 mV/m) contour for each of the 360 
radials.\294\ The resulting distance to principal community 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 principal 
community coverage area.
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    \294\ 294 47 CFR 73.313.
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Attachment F--FY 2007 Schedule of Regulatory Fees

------------------------------------------------------------------------
                                                             Annual
                     Fee category                        regulatory fee
                                                           (U.S. $'s)
------------------------------------------------------------------------
PLMRS (per license) (Exclusive Use) (47 CFR part 90)..          35
Microwave (per license) (47 CFR part 101).............          40
218-219 MHz (Formerly Interactive Video Data Service)           55
 (per license) (47 CFR part 95).......................
Marine (Ship) (per station) (47 CFR part 80)..........          10
Marine (Coast) (per license) (47 CFR part 80).........          30
General Mobile Radio Service (per license) (47 CFR               5
 part 95).............................................
Rural Radio (47 CFR part 22) (previously listed under           15
 the Land Mobile category)............................
PLMRS (Shared Use) (per license) (47 CFR part 90).....          15
Aviation (Aircraft) (per station) (47 CFR part 87)....           5
Aviation (Ground) (per license) (47 CFR part 87)......          10
Amateur Vanity Call Signs (per call sign) (47 CFR part           1.17
 97)..................................................
CMRS Mobile/Cellular Services (per unit) (47 CFR parts            .18
 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               325
 license sign) (47 CFR part 21).......................
Local Multipoint Distribution Service (per call sign)          325
 (47 CFR part 101)....................................
AM Radio Construction Permits.........................         400
FM Radio Construction Permits.........................         575
TV (47 CFR part 73) VHF Commercial....................

[[Page 30591]]

 
    Markets 1-10......................................      64,300
    Markets 11-25.....................................      46,350
    Markets 26-50.....................................      31,075
    Markets 51-100....................................      20,000
    Remaining Markets.................................       5,125
    Construction Permits..............................       5,125
TV (47 CFR part 73) UHF Commercial....................
    Markets 1-10......................................      19,650
    Markets 11-25.....................................      19,450
    Markets 26-50.....................................      10,800
    Markets 51-100....................................       6,300
    Remaining Markets.................................       1,750
    Construction Permits..............................       1,750
Satellite Television Stations (All Markets)...........       1,100
Construction Permits--Satellite Television Stations...         550
Low Power TV, TV/FM Translators & Boosters (47 CFR             345
 part 74).............................................
Broadcast Auxiliary (47 CFR part 74)..................          10
CARS (47 CFR part 78).................................         185
Cable Television Systems (per subscriber) (47 CFR part            .75
 76)..................................................
Interstate Telecommunication Service Providers (per               .00266
 revenue dollar)......................................
Earth Stations (47 CFR part 25).......................         185
Space Stations (per operational station in                 109,200
 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-             116,475
 geostationary orbit) (47 CFR part 25)................
International Bearer Circuits (per active 64KB                   1.05
 circuit).............................................
International Public Fixed (per call sign) (47 CFR           1,875
 part 23).............................................
International (HF) Broadcast (47 CFR part 73).........         795
------------------------------------------------------------------------

FY 2007 Schedule of Regulatory Fees (continued)

                                      FY 2007 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,
                                                                                         A, B1 & C3    C1 & C2
----------------------------------------------------------------------------------------------------------------
<=25,000..........................         $625         $475         $400         $475         $575         $725
25,001-75,000.....................        1,225          925          600          725        1,150        1,250
75,001-150,000....................        1,825        1,150          800        1,200        1,600        2,300
150,001-500,000...................        2,750        1,950        1,200        1,425        2,475        3,000
500,001-1,200,000.................        3,950        2,975        2,000        2,375        3,900        4,400
1,200,001-3,000,00................        6,075        4,575        3,000        3,800        6,350        7,025
>3,000,000........................        7,275        5,475        3,800        4,750        8,075        9,125
----------------------------------------------------------------------------------------------------------------

 [FR Doc. E8-11891 Filed 5-27-08; 8:45 am]
BILLING CODE 6712-01-P