[Federal Register Volume 75, Number 79 (Monday, April 26, 2010)]
[Proposed Rules]
[Pages 21536-21567]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-9553]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 1

[MD Docket No. 10-87; FCC 10-51]


Assessment and Collection of Regulatory Fees for Fiscal Year 2010

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 an amount of $335,794,000 that Congress has required 
the Commission to collect for fiscal year 2010. 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 4, 2010, and reply comments are due May 11, 
2010.

ADDRESSES: You may submit comments, identified by MD Docket No. 10-87, 
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. 10-87 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: Roland Helvajian, Office of Managing 
Director at (202) 418-0444.

SUPPLEMENTARY INFORMATION:
    Adopted: April 12, 2010.
    Released: April 13, 2010.
    By the Commission.

Table of Contents

 
                                                               Paragraph
 
I. Introduction.............................................           1
    A. FY 2010 Regulatory Fee Assessment Methodology........           2
        1. AM and FM Radio Stations.........................           4
        2. Submarine Cable Methodology......................           5
    B. Regulatory Fee Obligations for Digital Full Service             7
     Television Broadcasters................................
    C. Regulatory Fee Obligations for Digital Low Power,               8
     Class A, and TV Translators/Boosters...................
    D. Commercial Mobile Radio Service Messaging Service....           9
    E. Administrative and Operational Issues................          10
        1. Mandatory Use of Fee Filer.......................          11
        2. Notification and Collection of Regulatory Fees...          12
            a. Pre-Bills....................................          12
II. Procedural Matters......................................          13
    A. Public Notices and Fact Sheets.......................          14
    B. Assessment Notifications.............................          15
        1. Media Services Licensees.........................          15
        2. CMRS Cellular and Mobile Services Assessments....          18
    C. Streamlined Regulatory Fee Payment Process...........          21
        1. Cable Television Subscribers.....................          21
        2. CMRS Cellular and Mobile Providers...............          22
        3. Interstate Telecommunications Service Providers            23
         (``ITSP'').........................................
    D. Payment of Regulatory Fees...........................          24
        1. Lock Box Bank....................................          24
        2. Receiving Bank for Wire Payments.................          25
        3. De Minimis Regulatory Fees.......................          26
        4. Standard Fee Calculations and Payment Dates......          27

[[Page 21537]]

 
    E. Enforcement..........................................          28
    F. Initial Regulatory Flexibility Analysis..............          30
    G. Initial Paperwork Reduction Act of 1995 Analysis.....          31
    H. Congressional Review Act Analysis....................          32
    I. Ex Parte Rules.......................................          33
    J. Filing Requirements..................................          34
III. Ordering Clauses.......................................          39
Appendix A Calculation of FY 2010 Revenue Requirements and
 Pro-Rata Fees
Appendix B FY 2010 Schedule of Regulatory Fees
Appendix C Sources of Payment Unit Estimates for FY 2010
Appendix D Factors, Measurements, and Calculations That Go
 Into Determining Station Signal Contours and Associated
 Population Coverages
Appendix E Initial Regulatory Flexibility Analysis
Appendix F FY 2009 Schedule of Regulatory Fees
 

I. Introduction

    1. In this Notice of Proposed Rulemaking, we propose to collect 
$335,794,000 in regulatory fees for Fiscal Year (``FY'') 2010, pursuant 
to section 9 of the Communications Act of 1934, as amended (the 
``Act''). Section 9 regulatory fees are mandated by Congress and are 
collected to recover the regulatory costs associated with the 
Commission's enforcement, policy and rulemaking, user information, and 
international activities.\1\ The annual regulatory fee amount to be 
collected is established each year in the Commission's Annual 
Appropriations Act which is adopted by Congress and signed by the 
President and which funds the Commission.\2\ In this annual regulatory 
fee proceeding, we retain many of the established methods, policies, 
and procedures for collecting section 9 regulatory fees adopted by the 
Commission in prior years. Consistent with our established practice, we 
intend to collect these regulatory fees during an August 2010 filing 
window in order to collect the required amount by the end of our fiscal 
year.
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    \1\ 47 U.S.C. 159(a).
    \2\ See Consolidated Appropriations Act, 2010, Public Law 111-
117 for the FY 2010 appropriations act language for the Commission 
establishing the amount of $335,794,000 of offsetting collections to 
be assessed and collected by the Commission pursuant to section 9 of 
the Communications Act.
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A. FY 2010 Regulatory Fee Assessment Methodology

    2. In our FY 2010 regulatory fee assessment, we will use the same 
section 9 regulatory fee assessment methodology adopted in FY 2009. 
Each fiscal year, the Commission proportionally allocates the total 
amount that must be collected via section 9 regulatory fees. The 
results of our FY 2010 regulatory fee assessment methodology (including 
a comparison to the prior year's results) are contained in Appendix A. 
To collect the $335,794,000 required by Congress, we adjust the FY 2009 
amount downward by 1.8 percent and allocate this amount across the 
various fee categories. Consistent with past practice, we then divide 
the FY 2010 amount by the number of estimated payment units in each fee 
category to determine the unit fee.\3\ As in prior years, for cases 
involving small fees, e.g., licenses that are renewed over a multiyear 
term, we divide the resulting unit fee by the term of the license and 
then rounded these unit fees consistent with the requirements of 
section 9(b)(2) of the Act.
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    \3\ In many instances, the regulatory fee amount is a flat fee 
per licensee or regulatee. In some instances, the fee amount 
represents a per-unit fee (such as for International Bearer 
Circuits), a per-unit subscriber fee (such as for Cable, Commercial 
Mobile Radio Service (``CMRS'') Cellular/Mobile and CMRS Messaging), 
or a fee factor per revenue dollar (Interstate Telecommunications 
Service Provider (``ITSP'') fee). The payment unit is the measure 
upon which the fee is based, such as a licensee, regulatee, or 
subscriber fee.
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    3. In calculating the FY 2010 regulatory fees listed in Appendix B, 
we further adjusted the FY 2009 list of payment units (see Appendix C) 
based upon licensee databases, industry and trade group projections, as 
well as prior year payment information. In some instances, Commission 
licensee databases were used; in other instances, actual prior year 
payment records and/or industry and trade association projections were 
used in determining the payment unit counts.\4\ Where appropriate, we 
adjusted and rounded our final estimates to take into consideration 
events that may impact the number of units for which regulatees submit 
payment, such as waivers and exemptions that may be filed in FY 2010, 
and fluctuations in the number of licenses or station operators due to 
economic, technical, or other reasons. Our estimated FY 2010 payment 
units, therefore, are based on several variable factors that are 
relevant to each fee category. The fee rate also may be rounded or 
adjusted slightly to account for these variables.
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    \4\ The databases we consulted are the following: The 
Commission's Universal Licensing System (``ULS''), International 
Bureau Filing System (``IBFS''), Consolidated Database System 
(``CDBS'') and Cable Operations and Licensing System (``COALS''). We 
also consulted reports generated within the Commission such as the 
Wireline Competition Bureau's Trends in Telephone Service and the 
Wireless Telecommunications Bureau's Numbering Resource Utilization 
Forecast and Annual CMRS Competition Report, as well as industry 
sources including, but not limited to, Television & Cable Factbook 
by Warren Publishing, Inc. and the Broadcasting and Cable Yearbook 
by Reed Elsevier, Inc.
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1. AM and FM Radio Stations
    4. As in previous years, we consider the additional factors of 
facility attributes and the population served by each radio station in 
determining regulatory fees for AM and FM radio stations. The 
calculation of the population served is determined by coupling current 
U.S. Census Bureau data with technical and engineering data, as 
detailed in Appendix D. Consequently, the population served, as well as 
the class and type of service (AM or FM), will continue to determine 
the amount of regulatory fee to be paid.\5\
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    \5\ In addition, beginning in FY 2005, we established a 
procedure by which we set regulatory fees for AM and FM radio and 
VHF and UHF television Construction Permits each year at an amount 
no higher than the lowest regulatory fee for a licensed station in 
that respective service category. For example, in FY 2009 the 
regulatory fee for an AM radio station Construction Permit was no 
higher than the regulatory fee for an AM Class C radio station 
serving a population of less than 25,000.
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2. Submarine Cable Methodology
    5. In its Second Report and Order (``Submarine Cable Order'') 
released on March 24, 2009, the Commission adopted a new submarine 
cable bearer circuit methodology that assessed regulatory fees on a per 
cable landing license basis, with higher fees for larger submarine 
cable systems and lower fees for smaller systems, without 
distinguishing between common

[[Page 21538]]

carriers and non-common carriers.\6\ For all other categories of 
international bearer circuits--common carrier and non-common carrier 
satellite facilities and common carrier terrestrial facilities--the 
Submarine Cable Order retained the existing regulatory fee methodology 
of assessing fees on a per 64 kbps circuit basis.
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    \6\ See Assessment and Collection of Regulatory Fees for Fiscal 
Year 2008, Second Report and Order, 24 FCC Rcd 4208, para. 1 (March 
24, 2009) (``Submarine Cable Order'').
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    6. In the Submarine Cable Order and in the FY 2009 Regulatory Fees 
Report and Order,\7\ the Commission allocated the total FY 2009 bearer 
circuit expected revenue into two revenue components: A submarine cable 
revenue component (87.6 percent) and a satellite/terrestrial revenue 
component (12.4 percent) using the Consensus Proposal allocation 
adopted by the Commission in the Submarine Cable Order.\8\ According to 
the Consensus Proposal, this allocation of 87.6 percent (submarine 
cable) and 12.4 percent (satellite/terrestrial) was calculated by 
determining the revenue obligations of submarine cable systems with the 
revenue obligations of the satellite and terrestrial facilities using 
the FY 2008 revenue requirement as its basis.\9\ Since we do not have 
any additional information that would lead us to change this allocation 
percentage for FY 2010, we propose to continue to use the allocation 
percentages of 87.6 percent (submarine cable) and 12.4 percent 
(satellite and terrestrial) for calculating FY 2010 submarine cable 
regulatory fees. Consistent with the Commission's annual process of 
updating its schedule of regulatory fees with recent data, however, we 
reserve the right to re-examine the allocation percentages described 
above on an annual basis.
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    \7\ See FY 2009 Report and Order at Appendix B.
    \8\ See Submarine Cable Order at paragraphs 1 and 6.
    \9\ Id. at 6.
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B. Regulatory Fee Obligations for Digital Full Service Television 
Broadcasters

    7. In our FY 2009 Report and Order, we stated that, beginning in FY 
2010, we plan to collect regulatory fees from digital broadcasters, and 
we sought comment on this plan to collect regulatory fees on full-power 
digital broadcast stations beginning with FY 2010, i.e., the fiscal 
year after the nation-wide transition date on June 12, 2009.\10\ Since 
the digital transition on June 12, 2009 has eliminated the distinction 
between digital and analog full-service television stations, the 
digital-only exemption will no longer apply beginning in FY 2010. 
Beginning in FY 2010, we will collect annual regulatory fees from all 
digital full-service television stations, and the ``digital-only'' 
exemption will no longer be applicable. Also, because this is the first 
year following the Commission's transition to digital full service 
television, it is possible that some facilities may be operating under 
a Special Temporary Authority (STA) beginning on October 1, 2009 until 
the digital license is issued. For FY 2010 regulatory fee purposes, 
these facilities operating under an STA will be considered to be fully 
operational licensed facilities and will be obligated to pay the same 
regulatory fee as a licensed full-service television station.
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    \10\ Id. at para. 13.
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C. Regulatory Fee Obligations for Digital Low Power, Class A, and TV 
Translators/Boosters

    8. Although the digital transition of full-service television 
stations was completed on June 12, 2009, the digital transition for Low 
Power, Class A, and TV Translators/Boosters is still voluntary, and 
there is currently no set date for the completion of this transition. 
Historically, the discussion of digital transition conversion with 
respect to regulatory fees has applied only to full-service television 
stations, and therefore, the elimination of the ``digital only'' 
exemption described in the above paragraph has no impact on this class 
of regulatees. Because the digital transition in the Low Power, Class 
A, and TV Translators/Booster facilities is voluntary and the 
transition will occur over a period time, it is possible that some 
facilities will convert from analog to digital more quickly than 
others. During this interim transition period, licensees of Low Power, 
Class A, and TV Translator/Booster facilities could be operating in 
analog mode, in digital mode, or in an analog and digital simulcast 
mode. For regulatory fee purposes, a fee will be assessed for each 
facility operating either in an analog or digital mode. In instances in 
which a licensee is operating in both an analog and digital mode as a 
simulcast, a single regulatory fee will be assessed for this analog 
facility that has a digital companion channel. As greater numbers of 
facilities convert to digital mode, the Commission will provide revised 
instructions on how regulatory fees will be assessed.

D. Commercial Mobile Radio Service Messaging Service

    9. Commercial Mobile Radio Service (``CMRS'') Messaging Service, 
which replaced the CMRS One-Way Paging fee category in 1997, includes 
all narrowband services.\11\ Since 1997, the number of subscribers has 
declined from 40.8 million to 6.5 million, and there does not appear to 
be any sign of recovery to the subscriber levels of 1997-1999. 
Maintaining the fee at the existing level of $.08 per subscriber is the 
minimum reasonable and appropriate action to take under the prevailing 
circumstances in the paging industry. We propose in FY 2010 to continue 
maintaining the regulatory fee rate at $0.08 per subscriber due to the 
declining subscriber base in this industry.\12\ We seek comment on this 
proposal.
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    \11\ 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'').
    \12\ Between FY 1997 and FY 2009, the subscriber base in the 
paging industry declined 84 percent from 40.8 million to 6.5 million 
subscribers, according to FY 2009 collections data as of September 
30, 2009.
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E. Administrative and Operational Issues

    10. In FY 2009, the Commission implemented several changes in 
procedures which simplified the payment and reconciliation processes of 
FY 2009 regulatory fees. These changes proved to be very helpful to 
both licensees and to the Commission, and we propose in the following 
paragraphs to expand upon these improvements. In FY 2010, the 
Commission will promote greater use of technology (and less use of 
paper) to improve the regulatory fee notification and collection 
process. We seek general comment on ways to promote greater use of 
technology in collecting regulatory fees.
1. Mandatory Use of Fee Filer
    11. In FY 2009, we instituted a mandatory filing requirement using 
the Commission's electronic filing and payment system (also known as 
``Fee Filer'').\13\ Licensees filing their annual regulatory fee 
payments were required to begin the process by entering the 
Commission's Fee Filer system with a valid FRN and password. This 
change was beneficial to both licensees and to the Commission. For 
example, for licensees, the mandatory use of Fee Filer eliminated the 
need to manually complete and submit a hardcopy Form 159, and for the 
Commission, the data in electronic format made it much easier to 
process payments more efficiently and effectively. Because of the 
success of this process change, we propose to continue to make the use 
of Fee Filer for filing annual regulatory fees mandatory. We seek 
comment on this proposal. As

[[Page 21539]]

in FY 2009, the mandatory use of Fee Filer does not mean that licensees 
are expected to pay only through Fee Filer--it is only mandatory for 
licensees to begin the process of filing their annual regulatory fees 
using Fee Filer. This is one reason it is very important for licensees 
to have a current and valid FRN address on file in the Commission's 
Registration System (CORES). Going forward, only Form 159-E documents 
generated from Fee Filer will be permitted when sending in a regulatory 
fee payment to U.S. Bank. These Form 159-E's not only will reduce 
errors resulting from illegible handwriting on hardcopy Form 159's, 
but, because they are generated from Fee Filer, these forms also will 
create an electronic record of licensee payment attributes that are 
more easily tracked and searched than hardcopy Form 159's that are 
completed manually and mailed to the Commission.
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    \13\ FY 2009 Report and Order at paragraphs 20 and 21.
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2. Notification and Collection of Regulatory Fees
a. Pre-bills
    12. In prior years, the Commission mailed pre-bills via surface 
mail to licensees in select regulatory fee categories: Interstate 
telecommunications service providers (``ITSPs''), Geostationary 
(``GSO'') and Non-Geostationary (``NGSO'') satellite space station 
licensees,\14\ holders of Cable Television Relay Service (``CARS'') 
licenses, and Earth Station licensees.\15\ The remaining regulatees did 
not receive pre-bills. In our FY 2009 Report and Order, the Commission 
decided to have the attributes of these pre-bills viewed in Fee Filer, 
rather than mailing pre-bills out to licensees via surface mail.\16\ 
Although the overall response to this procedural change was positive, 
it was apparent that a greater effort should have been made to inform 
licensees that they would not be receiving a hardcopy regulatory fee 
bill in the mail. In FY 2010, the Commission will continue to reduce 
its use of hardcopy documents by not mailing out annual regulatory fee 
bills, but the Commission is seeking to increase its efforts in 
notifying licensees that hardcopy regulatory fee bills will not be 
mailed out. We seek comment on how to most efficiently and effectively 
notify licensees that hardcopy regulatory fee bills will not be mailed 
out, but that, instead, the amount and attributes of the bills will be 
available in Fee Filer for review.
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    \14\ Geostationary orbit space station (``GSO'') licensees 
received regulatory fee pre-bills 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 regulatory fee 
pre-bills for systems that were licensed by the Commission and 
operational on or before October 1 of the respective fiscal year.
    \15\ 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.
    \16\ See FY 2009 Report and Order at paragraphs 24, 26.
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II. Procedural Matters

    13. Included below are procedural items as well as our current 
payment and collection methods, which we have revised over the past 
several years to expedite the processing of regulatory fee payments. We 
include these payments and collection procedures here as a useful way 
of reminding regulatory fee payers and the public about these aspects 
of the annual regulatory fee collection process.

A. Public Notices and Fact Sheets

    14. 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, but as in previous years we will not send out public 
notices and fact sheets to regulatees en masse.

B. Assessment Notifications

1. Media Services Licensees
    15. Beginning in FY 2003, we sent fee assessment notifications via 
surface mail to media services entities on a per-facility basis.\17\ 
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.\18\ Consistent with procedures used last year, we will mail 
out media assessment notifications to licensees in FY 2010 at their 
primary record of contact populated in our Consolidated Database System 
(``CDBS''), and to a secondary record of contact, if available.\19\ 
However, after FY 2010, as part of the Commission's initiative to 
emphasize electronic filing and reduce paper usage, the Commission will 
stop mailing out media notification assessments to media licensees. 
Instead the Commission will rely more on its various Web sites, 
including the Commission-authorized Web site at http://www.fccfees.com, 
to notify licensees of pending annual regulatory fees and to update or 
correct any information regarding their facilities and their fee-exempt 
status.\20\ We seek comment on our proposal to discontinue sending out 
media notification letters after the FY 2010 regulatory fee season.
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    \17\ As stated previously at footnote 41, 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.
    \18\ 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.
    \19\ We will 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. As in prior 
years, fee assessments will not be issued for broadcast auxiliary 
stations.
    \20\ 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''). There is also a Commission-authorized Web site 
that media services licensees can use to view and update their 
exempt status (http://www.fccfees.com).
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    16. The decision to discontinue mailing media notifications 
beginning in FY 2011 is consistent with the Commission's effort to 
become more electronic and less paper-oriented. However, the Commission 
understands that not all media licensees are able to access the 
Commission's various electronic Web sites once the hardcopy 
notification letters are discontinued in FY 2011. Therefore, to be 
receptive to the needs of these licensees, the Commission will leave 
the comment and reply comment period open until September 30, 2010 on 
the specific issue of whether the media notification letters should be 
discontinued in FY 2011. Because this decision does not impact FY 2010 
regulatory fees, we will be addressing this issue in the Commission's 
FY 2011 Notice of Proposed Rulemaking after we have had the chance to 
review the various

[[Page 21540]]

comments and reply comments that have been submitted. In addition to 
raising this issue in this document, the Commission will also remind 
media licensees of this proposed change in notification procedures when 
it sends out letters to media licensees later in the fiscal year 
regarding their FY 2010 regulatory fee obligations. To ensure that the 
comments of all potentially affected persons are properly included in 
the record, media licensees should submit their comments and reply 
comments on this issue as follows:
     Electronic Filers: Comments may be filed electronically 
using the Internet by accessing the ECFS: http://fjallfoss.fcc.gov/ecfs2/or the Federal eRulemaking Portal: http://www.regulations.gov.
     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.
     Effective December 28, 2009, all hand-delivered or 
messenger-delivered paper filings for the Commission's Secretary must 
be delivered to FCC Headquarters at 445 12th St., SW., Room TW-A325, 
Washington, DC 20554. 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 must be addressed to 445 12th Street, SW., Washington, DC 20554.
    17. Although the Commission will mail media assessment 
notifications to licensees in FY 2010, all licensees (including media 
services) will be required to use Fee Filer as the first step in paying 
their regulatory fee obligations. The notification assessments provide 
licensees with the same media data attributes found on Fee Filer; 
however, receiving this information in FY 2010 via mail notification 
does not obviate, nor should it be considered a substitute for, using 
Fee Filer as the first step in filing and paying annual regulatory 
fees. As explained previously, licensees must first log onto the 
Commission's Fee Filer system to begin the process of filing and paying 
their regulatory fees, but once in Fee Filer, licensees may pay by 
check or money order, credit card, or wire transfer. A Form 159-E 
generated from Fee Filer is required, even when mailing in the annual 
regulatory fee payment.
2. CMRS Cellular and Mobile Services Assessments
    18. As we have done in prior years, we will mail an initial 
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'').\21\ The 
letter will include a listing of the carrier's Operating Company 
Numbers (``OCNs'') upon which the assessment is based.\22\ The letters 
will not include OCNs with their respective assigned number counts, but 
rather, an aggregate total of assigned numbers for each carrier.
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    \21\ 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, paragraphs 
38-44 (2005).
    \22\ Id.
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    19. If the carrier does not agree with the number of subscribers 
listed on the initial assessment letter, providers will have an 
opportunity within a specific timeframe to revise their subscriber 
counts by submitting supporting documentation to substantiate the 
change. However, instead of mailing the revised figures, providers will 
be asked to access Fee Filer and follow the instructions provided in 
order to submit their revised subscriber count along with any 
supporting documentation.\23\ The Commission will then review the 
revised count and supporting documentation and either approve or 
disapprove the submission in Fee Filer. The provider will be able to 
review the decision online in Fee Filer. If the submission is 
disapproved, the Commission will also attempt to contact the provider 
so that the provider will have an opportunity to discuss its revised 
subscriber count and/or provide additional supporting documentation. If 
we receive no response or correction to the initial assessment letter, 
or we do not reverse the disapproval of the provider's revised count 
submission, we will expect the fee payment to be based on the number of 
subscribers listed on the initial assessment. Once the timeframe for 
revision has passed, the subscriber counts will be finalized. These 
subscriber counts will then be the basis upon which CMRS regulatory 
fees will be expected. Providers will be able to view their final 
subscriber counts online in Fee Filer. A final CMRS assessment letter 
will not be mailed out.
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    \23\ In the supporting documentation, the provider will need to 
state a reason for the change, such as a purchase or sale of a 
subsidiary, the date of the transaction, and any other pertinent 
information that will help to justify a reason for the change.
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    20. Because some carriers do not file the NRUF report, they may not 
receive an initial letter of assessment. In these instances, the 
carriers should compute their fee payment using the standard 
methodology \24\ that is currently in place for CMRS Wireless services 
(e.g., compute their subscriber counts as of December 31, 2009), and 
submit their fee payment accordingly. Whether a carrier receives an 
assessment letter or not, the Commission reserves the right to audit 
the number of subscribers for which regulatory fees are paid. In the 
event that the Commission determines that the number of subscribers 
paid is inaccurate, the Commission will bill the carrier for the 
difference between what was paid and what should have been paid.
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    \24\ See, e.g., Federal Communications Commission, Regulatory 
Fees Fact Sheet: What You Owe--Commercial Wireless Services for FY 
2009 at 1 (rel. September 2009).
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C. Streamlined Regulatory Fee Payment Process

1. Cable Television Subscribers
    21. We will 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.
2. CMRS Cellular and Mobile Providers
    22. In FY 2006, we streamlined the CMRS payment process by 
eliminating the requirement for CMRS providers to identify their 
individual call signs when making their regulatory fee payment, instead 
allowing CMRS providers to pay their regulatory fees only at the 
aggregate subscriber level without having to identify their various 
call signs.\25\ We will continue this practice in FY 2010. In FY 2007, 
we consolidated the CMRS cellular and CMRS mobile fee categories into 
one fee category with a single 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 
2010, we will continue this practice of combining the CMRS cellular and

[[Page 21541]]

CMRS mobile fee categories into one regulatory fee category.
---------------------------------------------------------------------------

    \25\ 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).
---------------------------------------------------------------------------

3. Interstate Telecommunications Service Providers (``ITSP'')
    23. 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 
performed in a consistent manner and eliminated processing issues that 
occurred in prior years. In FY 2010, we will continue rounding lines 14 
and 16 when calculating the FY 2010 ITSP fee obligation. In addition, 
as in FY 2009, we will continue the practice of not mailing out Form 
159-W via surface mail.

D. Payment of Regulatory Fees

1. Lock Box Bank
    24. All lock box payments to the Commission for FY 2010 will be 
processed by U.S. Bank, St. Louis, Missouri, and payable to the FCC. 
During the regulatory fee season, for those licensees paying by check, 
money order, or by credit card using Form 159-E remittance advice, the 
fee payment and Form 159-E remittance advice should be mailed to the 
following address: Federal Communications Commission, Regulatory Fees, 
P.O. Box 979084, St. Louis, MO 63197-9000. Additional payment options 
and instructions are posted at http://www.fcc.gov/fees/regfees.html.
2. Receiving Bank for Wire Payments
    25. The receiving bank for all wire payments is the Federal Reserve 
Bank, New York, New York (TREAS NYC). When making a wire transfer, 
regulatees must fax a copy of their Fee Filer generated Form 159-E 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. Regulatees should discuss 
arrangements (including bank closing schedules) with their bankers 
several days before they plan to make the wire transfer to allow 
sufficient time for the transfer to be initiated and completed before 
the deadline. Complete instructions for making wire payments are posted 
at http://www.fcc.gov/fees/wiretran.html.
3. De Minimis Regulatory Fees
    26. Regulatees whose total FY 2010 regulatory fee liability, 
including all categories of fees for which payment is due, is less than 
$10 are exempted from payment of FY 2010 regulatory fees.
4. Standard Fee Calculations and Payment Dates
    27. The Commission will accept fee payments made in advance of the 
window for the payment of regulatory fees. The responsibility for 
payment of fees by service category is as follows:
     Media Services: Regulatory fees must be paid for initial 
construction permits (including construction permits for digital 
television stations) that were granted on or before October 1, 2009 for 
AM/FM radio stations, analog VHF/UHF full service television stations, 
and satellite television stations. Regulatory fees must be paid for all 
broadcast facility licenses granted on or before October 1, 2009. In 
instances where a permit or license is transferred or assigned after 
October 1, 2009, 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, 
2009. In instances where a permit or license is transferred or assigned 
after October 1, 2009, responsibility for payment rests with the holder 
of the permit or license as of the fee due date. We note that audio 
bridging service providers are included in this category.\26\
---------------------------------------------------------------------------

    \26\ Audio bridging services are toll teleconferencing services, 
and audio bridging service providers are required to contribute 
directly to the universal service fund based on revenues from these 
services. On June 30, 2008, the Commission released the InterCall 
Order, in which the Commission stated that InterCall, Inc. and all 
similarly situated audio bridging service providers are required to 
contribute directly to the universal service fund. See Request for 
Review by InterCall, Inc. of Decision of Universal Service 
Administrator, CC Docket No. 96-45, Order, 23 FCC Rcd 10731 (2008) 
(``InterCall Order'').
---------------------------------------------------------------------------

     Wireless Services: CMRS cellular, mobile, and messaging 
services (fees based on number of subscribers or telephone number 
count): Regulatory fees must be paid for authorizations that were 
granted on or before October 1, 2009. The number of subscribers, units, 
or telephone numbers on December 31, 2009 will be used as the basis 
from which to calculate the fee payment. In instances where a permit or 
license is transferred or assigned after October 1, 2009, 
responsibility for payment rests with the holder of the permit or 
license as of the fee due date.
     The first eleven regulatory fee categories in our Schedule 
of Regulatory Fees (see Appendix B) pay ``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 fee 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 2010.
     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, 
2009.\27\ Regulatory fees also must be paid for CARS licenses that were 
granted on or before October 1, 2009. In instances where a permit or 
license is transferred or assigned after October 1, 2009, 
responsibility for payment rests with the holder of the permit or 
license as of the fee due date.
---------------------------------------------------------------------------

    \27\ 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 2009, rather than on a count as of December 31, 
2009.
---------------------------------------------------------------------------

     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, 2009. In instances where a permit 
or license is transferred or assigned after October 1, 2009, 
responsibility for payment rests with the holder of the permit or 
license as of the fee due date.
     International Services: Submarine Cable Systems: 
Regulatory fees for submarine cable systems are to be paid on a per 
cable landing license basis based on circuit capacity as of December 
31, 2009. In instances where a license is transferred or assigned after 
October 1, 2009, responsibility for payment rests with the holder of 
the license as of the fee due date.
     International Services: Terestrial and Satellite Services: 
Finally, regulatory fees for International Bearer Circuits are to be 
paid by facilities-based common carriers that have active (used or 
leased) international bearer circuits as of December 31, 2009 in any 
terrestrial or satellite 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

[[Page 21542]]

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. ``Active circuits'' for these purposes include 
backup and redundant circuits as of December 31, 2009. Whether circuits 
are used specifically for voice or data is not relevant for these 
purposes in determining that they are active circuits. In instances 
where a permit or license is transferred or assigned after October 1, 
2009, responsibility for payment rests with the holder of the permit or 
license as of the fee due date.

E. Enforcement

    28. To be considered timely, regulatory fee payments must be 
received and stamped at the lockbox bank by the last day of the 
regulatory fee filing window. Section 9(c) of the Act requires us to 
impose an additional charge as a penalty for late payment of any 
regulatory fee.\28\ A late payment penalty of 25 percent of the unpaid 
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 those set forth in section 1.1910 of the 
Commission's rules \29\ and in the Debt Collection Improvement Act of 
1996 (``DCIA'').\30\ 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.\31\ 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.
---------------------------------------------------------------------------

    \28\ 47 U.S.C. 159(c).
    \29\ See 47 CFR 1.1910.
    \30\ 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.
    \31\ 47 CFR 1.1940(d).
---------------------------------------------------------------------------

    29. 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.\32\ 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\ See 47 CFR 1.1161(c), 1.1164(f)(5), and 1.1910.
---------------------------------------------------------------------------

F. Initial Regulatory Flexibility Analysis

    30. An initial regulatory flexibility analysis (``IRFA'') is 
contained in Appendix E. 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.

G. Initial Paperwork Reduction Act of 1995 Analysis

    31. This Notice of Proposed Rulemaking does not contain proposed 
information collection requirements subject to the Paperwork Reduction 
Act of 1995 (``PRA''), Public Law 104-13. In addition, therefore, it 
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, see 44 
U.S.C. 3506 (c) (4). Completion of the 159 family of forms required by 
the Commission's regulatory fee payment process is already approved by 
the Office of Management and Budget under information collections 3060-
0589 and 3060-0949.

H. Congressional Review Act Analysis

    32. The Commission will send a copy of this Notice of Proposed 
Rulemaking to Congress and the Government Accountability Office 
pursuant to the Congressional Review Act.\33\
---------------------------------------------------------------------------

    \33\ See 5 U.S.C. 801(a)(1)(A). The Congressional Review Act is 
contained in Title II, 251, of the CWAAA; see Public Law 104-121, 
Title II, 251, 110 Stat. 868.
---------------------------------------------------------------------------

I. Ex Parte Rules

    33. 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 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).
---------------------------------------------------------------------------

    \34\ See 47 CFR 1.1206(b); see also 47 CFR 1.1202, 1.1203.
    \35\ See 47 CFR 1.1206(b)(2).
---------------------------------------------------------------------------

J. Filing Requirements

    34. Comments and Replies. Pursuant to sections 1.415 and 1.419 of 
the Commission's rules, 47 CFR 1.415, 1.419, interested parties may 
file comments and reply 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) by filing paper copies. See 
Electronic Filing of Documents in Rulemaking Proceedings, 63 FR 24121 
(1998).
    35. Electronic Filers: Comments may be filed electronically using 
the Internet by accessing the ECFS: http://fjallfoss.fcc.gov/ecfs2/or 
the Federal eRulemaking Portal: http://www.regulations.gov.
    36. 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.
     Effective December 28, 2009, all hand-delivered or 
messenger-delivered paper filings for the Commission's Secretary must 
be delivered to FCC Headquarters at 445 12th St., SW., Room TW-A325, 
Washington, DC 20554. 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 must be

[[Page 21543]]

addressed to 445 12th Street, SW., Washington, DC 20554.
    People With Disabilities: To request materials in accessible 
formats for people with disabilities (braille, large print, electronic 
files, audio format), send an e-mail to [email protected] or call the 
Consumer & Governmental Affairs Bureau at 202-418-0530 (voice), 202-
418-0432 (tty).
    37. 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.
    38. 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 Commission'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.
    III. Ordering Clauses
    39. 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 is hereby adopted.
    40. 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 in Appendix E, to the Chief Counsel for 
Advocacy of the U.S. Small Business Administration.

Marlene H. Dortch,
Secretary, Federal Communications Commission.
BILLING CODE 6712-01-P

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[[Page 21547]]


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BILLING CODE 6712-01-C?>

[[Page 21550]]

Appendix C

Sources of Payment Unit Estimates for FY 2010

    In order to calculate individual service fees for FY 2010, we 
adjusted FY 2009 payment units for each service to more accurately 
reflect expected FY 2010 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 sought verification for these estimates from multiple sources 
and, in all cases we compared FY 2010 estimates with actual FY 2009 
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 with 
sufficient accuracy. These include an unknown number of waivers and/
or exemptions that may occur in FY 2010 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 2010 
payment units are based on FY 2009 actual payment units, it does not 
necessarily mean that our FY 2010 projection is exactly the same 
number as FY 2009. We have either rounded the FY 2010 number or 
adjusted it slightly to account for these variables.

------------------------------------------------------------------------
         Fee category              Sources of payment unit estimates
------------------------------------------------------------------------
Land Mobile (All), Microwave,  Based on Wireless Telecommunications
 218-219 MHz, Marine (Ship &    Bureau (``WTB'') projections of new
 Coast), Aviation (Aircraft &   applications and renewals taking into
 Ground), GMRS, Amateur         consideration existing Commission
 Vanity Call Signs, Domestic    licensee data bases. Aviation (Aircraft)
 Public Fixed.                  and Marine (Ship) estimates have been
                                adjusted to take into consideration the
                                licensing of portions of these services
                                on a voluntary basis.
CMRS Cellular/Mobile Services  Based on WTB projection reports, and FY
                                09 payment data.
CMRS Messaging Services......  Based on WTB reports, and FY 09 payment
                                data.
AM/FM Radio Stations.........  Based on CDBS data, adjusted for
                                exemptions, and actual FY 2009 payment
                                units.
UHF/VHF Television Stations..  Based on CDBS data, adjusted for
                                exemptions, and actual FY 2009 payment
                                units.
AM/FM/TV Construction Permits  Based on CDBS data, adjusted for
                                exemptions, and actual FY 2009 payment
                                units.
LPTV, Translators and          Based on CDBS data, adjusted for
 Boosters, Class A Television.  exemptions, and actual FY 2009 payment
                                units.
Broadcast Auxiliaries........  Based on actual FY 2009 payment units.
BRS (formerly MDS/MMDS)......  Based on WTB reports and actual FY 2009
                                payment units.
LMDS.........................  Based on WTB reports and actual FY 2009
                                payment units.
Cable Television Relay         Based on data from Media Bureau's COALS
 Service (``CARS'') Stations.   data base and actual FY 2009 payment
                                units.
Cable Television System        Based on publicly available data sources
 Subscribers.                   for estimated subscriber counts and
                                actual FY 2009 payment units.
Interstate Telecommunication   Based on FCC Form 499-Q data for the four
 Service Providers.             quarters of calendar year 2009, the
                                Wireline Competition Bureau projected
                                the amount of calendar year 2009 revenue
                                that will be reported on 2010 FCC Form
                                499-A worksheets in April 2010.
Earth Stations...............  Based on International Bureau (``IB'')
                                licensing data and actual FY 2009
                                payment units.
Space Stations (GSOs & NGSOs)  Based on IB data reports and actual FY
                                2009 payment units.
International Bearer Circuits  Based on IB reports and submissions by
                                licensees.
Submarine Cable Licenses.....  Based on IB license information.
------------------------------------------------------------------------


Appendix D

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 73.150 and 73.152 of the Commission's rules.\1\ 
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.\2\ 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 2,000 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.
---------------------------------------------------------------------------

    \1\ 47 CFR 73.150 and 73.152.
    \2\ 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.\3\ The resulting distance to 
principal community contours were used to form a geographical 
polygon. Population counting was accomplished by determining which 
2,000 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.
---------------------------------------------------------------------------

    \3\ 47 CFR 73.313.


[[Page 21551]]


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Appendix E

Initial Regulatory Flexibility Analysis

    1. As required by the Regulatory Flexibility Act (``RFA''),\36\ 
the Commission prepared this Initial Regulatory Flexibility Analysis 
(``IRFA'') of the possible significant economic impact on small 
entities by the policies and rules proposed in this Notice of 
Proposed Rulemaking. 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 
Notice. The Commission will send a copy of the Notice, including the 
IRFA, to the Chief Counsel for Advocacy of the Small Business 
Administration.\37\ In addition, the Notice and IRFA (or summaries 
thereof) will be published in the Federal Register.\38\
---------------------------------------------------------------------------

    \36\ 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'').
    \37\ 5 U.S.C. 603(a).
    \38\ Id.
---------------------------------------------------------------------------

I. Need for, and Objectives of, the Notice

    2. This rulemaking proceeding is initiated for the Commission to 
obtain comments regarding its proposed amendment to its Schedule of 
Regulatory Fees in the amount of $335,794,000, which is the amount 
that Congress has required the Commission to recover. The Commission 
seeks to collect the necessary amount through its revised Schedule 
of Regulatory Fees in the most efficient manner possible and without 
undue public burden.

II. Legal Basis

    3. 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.\39\
---------------------------------------------------------------------------

    \39\ 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 Rules Will Apply

    4. The RFA directs agencies to provide a description of, and 
where feasible, an estimate of the number of small entities that may 
be affected by the proposed rules and policies, if adopted.\40\ The 
RFA generally defines the term ``small entity'' as having the same 
meaning as the terms ``small business,'' ``small organization,'' and 
``small governmental jurisdiction.'' \41\ In addition, the term 
``small business'' has the same meaning as the term ``small business 
concern'' under the Small Business Act.\42\ 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.\43\
---------------------------------------------------------------------------

    \40\ 5 U.S.C. 603(b)(3).
    \41\ 5 U.S.C. 601(6).
    \42\ 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.''
    \43\ 15 U.S.C. 632.
---------------------------------------------------------------------------

    5. Small Businesses. Nationwide, there are a total of 
approximately 29.6 million small businesses, according to the 
SBA.\44\
---------------------------------------------------------------------------

    \44\ See SBA, Office of Advocacy, ``Frequently Asked 
Questions,'' http://web.sba.gov/faqs (accessed Jan. 2009).
---------------------------------------------------------------------------

    6. Small Organizations. Nationwide, as of 2002, there are 
approximately 1.6 million small organizations.\45\ A ``small 
organization'' is generally ``any not-for-profit enterprise which is 
independently owned and operated and is not dominant in its field.'' 
\46\
---------------------------------------------------------------------------

    \45\ Independent Sector, The New Nonprofit Almanac & Desk 
Reference (2002).
    \46\ 5 U.S.C. 601(4).
---------------------------------------------------------------------------

    7. 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.'' \47\ 
Census Bureau data for 2002 indicate that there were 87,525 local 
governmental jurisdictions in the United States.\48\ We estimate 
that, of this total, 84,377 entities were ``small governmental 
jurisdictions.'' \49\ Thus, we estimate that most governmental 
jurisdictions are small.
---------------------------------------------------------------------------

    \47\ 5 U.S.C. 601(5).
    \48\ U.S. Census Bureau, Statistical Abstract of the United 
States: 2006, section 8, p. 272, Table 415.
    \49\ 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.
---------------------------------------------------------------------------

    8. 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.'' \50\ 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.\51\ 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.
---------------------------------------------------------------------------

    \50\ 15 U.S.C. 632.
    \51\ 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).
---------------------------------------------------------------------------

    9. 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.\52\ According 
to Commission data,\53\ 1,311 carriers have reported that they are 
engaged in the provision of incumbent local exchange services. Of 
these 1,311 carriers, an estimated 1,024 have 1,500 or fewer 
employees and 287 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.
---------------------------------------------------------------------------

    \52\ 13 CFR 121.201, North American Industry Classification 
System (NAICS) code 517110.
    \53\ FCC, Wireline Competition Bureau, Industry Analysis and 
Technology Division, ``Trends in Telephone Service'' at Table 5.3, 
Page 5-5 (Aug. 2008) (``Trends in Telephone Service''). This source 
uses data that are current as of November 1, 2006.
---------------------------------------------------------------------------

    10. 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.\54\ According to Commission data,\55\ 1005 carriers 
have reported that they are engaged in the provision of either 
competitive access provider services or competitive local exchange 
carrier services. Of these 1005 carriers, an estimated 918 have 
1,500 or fewer employees and 87 have more than 1,500 employees. In 
addition, 16 carriers have reported that they are ``Shared-Tenant 
Service Providers,'' and all 16 are estimated to have 1,500 or fewer 
employees. In addition, 89 carriers have reported that they are 
``Other Local Service Providers.'' Of the 89, all have 1,500 or 
fewer 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.
---------------------------------------------------------------------------

    \54\ 13 CFR 121.201, NAICS code 517110.
    \55\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    11. 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.\56\ According to Commission data,\57\ 151 carriers 
have reported that they are engaged in the provision of local resale 
services. Of these, an estimated 149 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.
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    \56\ 13 CFR 121.201, NAICS code 517310.
    \57\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    12. 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

[[Page 21552]]

small if it has 1,500 or fewer employees.\58\ According to 
Commission data,\59\ 815 carriers have reported that they are 
engaged in the provision of toll resale services. Of these, an 
estimated 787 have 1,500 or fewer employees and 28 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.
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    \58\ 13 CFR 121.201, NAICS code 517310.
    \59\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    13. 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.\60\ According 
to Commission data,\61\ 526 carriers have reported that they are 
engaged in the provision of payphone services. Of these, an 
estimated 524 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.
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    \60\ 3 CFR 121.201, NAICS code 517110.
    \61\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    14. 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.\62\ According 
to Commission data,\63\ 300 carriers have reported that they are 
engaged in the provision of interexchange service. Of these, an 
estimated 268 have 1,500 or fewer employees and 32 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.
---------------------------------------------------------------------------

    \62\ 13 CFR 121.201, NAICS code 517110.
    \63\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    15. 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.\64\ According 
to Commission data,\65\ 28 carriers have reported that they are 
engaged in the provision of operator services. Of these, an 
estimated 27 have 1,500 or fewer employees and one has more than 
1,500 employees. Consequently, the Commission estimates that the 
majority of OSPs are small entities that may be affected by our 
proposed action.
---------------------------------------------------------------------------

    \64\ 13 CFR 121.201, NAICS code 517110.
    \65\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    16. 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.\66\ According to Commission data,\67\ 88 
carriers have reported that they are engaged in the provision of 
prepaid calling cards. Of these, an estimated 85 have 1,500 or fewer 
employees and three have 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.
---------------------------------------------------------------------------

    \66\ 13 CFR 121.201, NAICS code 517310.
    \67\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    17. 800 and 800-Like Service Subscribers.\68\ 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.\69\ 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.\70\ According to our data, at the end of December 2007, the 
number of 800 numbers assigned was 7,860,000; the number of 888 
numbers assigned was 5,210,184; the number of 877 numbers assigned 
was 4,388,682; and the number of 866 numbers assigned was 7,029,116. 
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 7,860,000 or fewer small entity 800 
subscribers; 5,210,184 or fewer small entity 888 subscribers; 
4,388,682 or fewer small entity 877 subscribers, and 7,029,116 or 
fewer entity 866 subscribers.
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    \68\ We include all toll-free number subscribers in this 
category.
    \69\ 13 CFR 121.201, NAICS code 517310.
    \70\ ``Trends in Telephone Service'' at Tables 18.4, 18.5, 18.6, 
and 18.7.
---------------------------------------------------------------------------

    18. Satellite Telecommunications and All Other 
Telecommunications. These two economic census categories address the 
satellite industry. The first category has a small business size 
standard of $15 million or less in average annual receipts, under 
SBA rules.\71\ The second has a size standard of $25 million or less 
in annual receipts.\72\ The most current Census Bureau data in this 
context, however, are from the (last) economic census of 2002, and 
we will use those figures to gauge the prevalence of small 
businesses in these categories.\73\
---------------------------------------------------------------------------

    \71\ 13 CFR 121.201, NAICS code 517410.
    \72\ 13 CFR 121.201, NAICS code 517919.
    \73\ 13 CFR 121.201, NAICS codes 517410 and 517910 (2002).
---------------------------------------------------------------------------

    19. The category of Satellite Telecommunications ``comprises 
establishments primarily engaged in providing 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.'' \74\ For this category, Census Bureau data for 
2002 show that there were a total of 371 firms that operated for the 
entire year.\75\ Of this total, 307 firms had annual receipts of 
under $10 million, and 26 firms had receipts of $10 million to 
$24,999,999.\76\ Consequently, we estimate that the majority of 
Satellite Telecommunications firms are small entities that might be 
affected by our action.
---------------------------------------------------------------------------

    \74\ U.S. Census Bureau, 2007 NAICS Definitions, ``517410 
Satellite Telecommunications''; http://www.census.gov/naics/2007/def/ND517410.HTM.
    \75\ U.S. Census Bureau, 2002 Economic Census, Subject Series: 
Information, ``Establishment and Firm Size (Including Legal Form of 
Organization),'' Table 4, NAICS code 517410 (issued Nov. 2005).
    \76\ Id. An additional 38 firms had annual receipts of $25 
million or more.
---------------------------------------------------------------------------

    20. The second category of All Other Telecommunications 
comprises, inter alia, ``establishments primarily engaged in 
providing specialized telecommunications services, such as satellite 
tracking, communications telemetry, and radar station operation. 
This industry also includes establishments primarily engaged in 
providing satellite terminal stations and associated facilities 
connected with one or more terrestrial systems and capable of 
transmitting telecommunications to, and receiving telecommunications 
from, satellite systems.'' \77\ For this category, Census Bureau 
data for 2002 show that there were a total of 332 firms that 
operated for the entire year.\78\ Of this total, 303 firms had 
annual receipts of under $10 million and 15 firms had annual 
receipts of $10 million to $24,999,999.\79\ Consequently, we 
estimate that the majority of All Other Telecommunications firms are 
small entities that might be affected by our action.
---------------------------------------------------------------------------

    \77\ U.S. Census Bureau, 2007 NAICS Definitions, ``517919 All 
Other Telecommunications''; http://www.census.gov/naics/2007/def/ND517919.HTM#N517919.
    \78\ U.S. Census Bureau, 2002 Economic Census, Subject Series: 
Information, ``Establishment and Firm Size (Including Legal Form of 
Organization),'' Table 4, NAICS code 517910 (issued Nov. 2005).
    \79\ Id. An additional 14 firms had annual receipts of $25 
million or more.
---------------------------------------------------------------------------

    21. Wireless Telecommunications Carriers (except Satellite). 
Since 2007, the Census Bureau has placed wireless firms within this 
new, broad, economic census category.\80\ Prior to that time, such 
firms were within the now-superseded categories of ``Paging'' and 
``Cellular and Other Wireless Telecommunications.'' \81\ Under the 
present and prior categories, the SBA has deemed a wireless business 
to be small if it has 1,500

[[Page 21553]]

or fewer employees.\82\ Because Census Bureau data are not yet 
available for the new category, we will estimate small business 
prevalence using the prior categories and associated data. For the 
category of Paging, data for 2002 show that there were 807 firms 
that operated for the entire year.\83\ Of this total, 804 firms had 
employment of 999 or fewer employees, and three firms had employment 
of 1,000 employees or more.\84\ For the category of Cellular and 
Other Wireless Telecommunications, data for 2002 show that there 
were 1,397 firms that operated for the entire year.\85\ Of this 
total, 1,378 firms had employment of 999 or fewer employees, and 19 
firms had employment of 1,000 employees or more.\86\ Thus, we 
estimate that the majority of wireless firms are small.
---------------------------------------------------------------------------

    \80\ U.S. Census Bureau, 2007 NAICS Definitions, ``517210 
Wireless Telecommunications Categories (Except Satellite)''; http://www.census.gov/naics/2007/def/ND517210.HTM#N517210.
    \81\ U.S. Census Bureau, 2002 NAICS Definitions, ``517211 
Paging''; http://www.census.gov/epcd/naics02/def/NDEF517.HTM.; U.S. 
Census Bureau, 2002 NAICS Definitions, ``517212 Cellular and Other 
Wireless Telecommunications''; http://www.census.gov/epcd/naics02/def/NDEF517.HTM.
    \82\ 13 CFR 121.201, NAICS code 517210 (2007 NAICS). The now-
superseded, pre-2007 C.F.R. citations were 13 CFR 121.201, NAICS 
codes 517211 and 517212 (referring to the 2002 NAICS).
    \83\ U.S. Census Bureau, 2002 Economic Census, Subject Series: 
Information, ``Establishment and Firm Size (Including Legal Form of 
Organization,'' Table 5, NAICS code 517211 (issued Nov. 2005).
    \84\ 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.''
    \85\ U.S. Census Bureau, 2002 Economic Census, Subject Series: 
Information, ``Establishment and Firm Size (Including Legal Form of 
Organization,'' Table 5, NAICS code 517212 (issued Nov. 2005).
    \86\ 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.''
---------------------------------------------------------------------------

    22. Common Carrier Paging. As noted, the SBA has developed a 
small business size standard for Wireless Telecommunications 
Carriers (except Satellite) firms within the broad economic census 
categories of ``Cellular and Other Wireless Telecommunications.'' 
\87\ Since 2007, the Census Bureau has placed wireless firms within 
this new, broad, economic census category.\88\ Prior to that time, 
such firms were within the now-superseded categories of ``Paging'' 
and ``Cellular and Other Wireless Telecommunications.'' \89\ Under 
the present and prior categories, the SBA has deemed a wireless 
business to be small if it has 1,500 or fewer employees.\90\ Because 
Census Bureau data are not yet available for the new category, we 
will estimate small business prevalence using the prior categories 
and associated data. For the category of Paging, data for 2002 show 
that there were 807 firms that operated for the entire year.\91\ Of 
this total, 804 firms had employment of 999 or fewer employees, and 
three firms had employment of 1,000 employees or more.\92\ For the 
category of Cellular and Other Wireless Telecommunications, data for 
2002 show that there were 1,397 firms that operated for the entire 
year.\93\ Of this total, 1,378 firms had employment of 999 or fewer 
employees, and 19 firms had employment of 1,000 employees or 
more.\94\ Thus, we estimate that the majority of wireless firms are 
small.
---------------------------------------------------------------------------

    \87\ 13 CFR 121.201, NAICS code 517212.
    \88\ U.S. Census Bureau, 2007 NAICS Definitions, ``517210 
Wireless Telecommunications Categories (Except Satellite)''; http://www.census.gov/naics/2007/def/ND517210.HTM#N517210.
    \89\ U.S. Census Bureau, 2002 NAICS Definitions, ``517211 
Paging''; http://www.census.gov/epcd/naics02/def/NDEF517.HTM.; U.S. 
Census Bureau, 2002 NAICS Definitions, ``517212 Cellular and Other 
Wireless Telecommunications''; http://www.census.gov/epcd/naics02/def/NDEF517.HTM.
    \90\ 13 CFR 121.201, NAICS code 517210 (2007 NAICS). The now-
superseded, pre-2007 CFR citations were 13 CFR 121.201, NAICS codes 
517211 and 517212 (referring to the 2002 NAICS).
    \91\ U.S. Census Bureau, 2002 Economic Census, Subject Series: 
Information, ``Establishment and Firm Size (Including Legal Form of 
Organization,'' Table 5, NAICS code 517211 (issued Nov. 2005).
    \92\ 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.''
    \93\ U.S. Census Bureau, 2002 Economic Census, Subject Series: 
Information, ``Establishment and Firm Size (Including Legal Form of 
Organization,'' Table 5, NAICS code 517212 (issued Nov. 2005).
    \94\ 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.''
---------------------------------------------------------------------------

    23. 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.\95\ 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.\96\ The SBA has approved this 
definition.\97\ An initial auction of Metropolitan Economic Area 
(``MEA'') licenses was conducted in the year 2000. Of the 2,499 
licenses auctioned, 985 were sold.\98\ Fifty-seven companies 
claiming small business status won 440 licenses.\99\ A subsequent 
auction of MEA and Economic Area (``EA'') licenses was held in the 
year 2001. Of the 15,514 licenses auctioned, 5,323 were sold.\100\ 
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, was held in 2003. Seventy-seven bidders claiming small 
or very small business status won 2,093 licenses.\101\
---------------------------------------------------------------------------

    \95\ 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).
    \96\ Paging Second Report and Order, 12 FCC Rcd at 2811, para. 
179.
    \97\ 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'').
    \98\ See ``929 and 931 MHz Paging Auction Closes,'' Public 
Notice, 15 FCC Rcd 4858 (WTB 2000).
    \99\ See id.
    \100\ See ``Lower and Upper Paging Band Auction Closes,'' Public 
Notice, 16 FCC Rcd 21821 (WTB 2002).
    \101\ See ``Lower and Upper Paging Bands Auction Closes,'' 
Public Notice, 18 FCC Rcd 11154 (WTB 2003). The current number of 
small or very small business entities that hold wireless licenses 
may differ significantly from the number of such entities that won 
in spectrum auctions due to assignments and transfers of licenses in 
the secondary market over time. In addition, some of the same small 
business entities may have won licenses in more than one auction.
---------------------------------------------------------------------------

    24. Currently, there are approximately 74,000 Common Carrier 
Paging licenses. According to the most recent Trends in Telephone 
Service, 281 carriers reported that they were engaged in the 
provision of ``paging and messaging'' services.\102\ Of these, an 
estimated 279 have 1,500 or fewer employees and two have more than 
1,500 employees.\103\ We estimate that the majority of common 
carrier paging providers would qualify as small entities under the 
SBA definition.
---------------------------------------------------------------------------

    \102\ ``Trends in Telephone Service'' at Table 5.3.
    \103\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    25. 2.3 GHz Wireless Communications Services. This service can 
be used for fixed, mobile, radiolocation, and digital audio 
broadcasting satellite uses. The Commission defined ``small 
business'' for the wireless communications services (``WCS'') 
auction as an entity with average gross revenues of $40 million for 
each of the three preceding years, and a ``very small business'' as 
an entity with average gross revenues of $15 million for each of the 
three preceding years.\104\ The SBA has approved these 
definitions.\105\ The Commission auctioned geographic area licenses 
in the WCS service. In the auction, which was conducted in 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.
---------------------------------------------------------------------------

    \104\ 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).
    \105\ See Alvarez Letter 1998.
---------------------------------------------------------------------------

    26. 1670-1675 MHz Services. An auction for one license in the 
1670-1675 MHz band was conducted in 2003. One license was awarded. 
The winning bidder was not a small entity.
    27. Wireless Telephony. Wireless telephony includes cellular, 
personal communications services, and specialized mobile radio 
telephony carriers. As noted, the SBA has developed a small business 
size standard for Wireless Telecommunications Carriers (except 
Satellite).\106\ Under the SBA small business size standard, a 
business is small if it has 1,500 or fewer employees.\107\ According 
to Trends in Telephone Service data, 434 carriers reported that they 
were engaged in wireless telephony.\108\ Of these, an estimated 222 
have 1,500 or fewer employees and 212 have more than 1,500 
employees.\109\ We have estimated that 222 of these are small under 
the SBA small business size standard.
---------------------------------------------------------------------------

    \106\ 13 CFR 121.201, NAICS code 517210.
    \107\ Id.
    \108\ ``Trends in Telephone Service'' at Table 5.3.
    \109\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    28. Broadband Personal Communications Service. The broadband 
personal

[[Page 21554]]

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.\110\ 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.\111\ These small business size standards, in the context of 
broadband PCS auctions, have been approved by the SBA.\112\ 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.\113\ In 1999, the Commission reauctioned 155 C, D, E, and F Block 
licenses; there were 113 small business winning bidders.\114\
---------------------------------------------------------------------------

    \110\ 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).
    \111\ See PCS Report and Order, 11 FCC Rcd at 7852, para. 60.
    \112\ See Alvarez Letter 1998.
    \113\ FCC News, ``Broadband PCS, D, E and F Block Auction 
Closes,'' No. 71744 (rel. Jan. 14, 1997).
    \114\ See ``C, D, E, and F Block Broadband PCS Auction Closes,'' 
public notice, 14 FCC Rcd 6688 (WTB 1999).
---------------------------------------------------------------------------

    29. In 2001, the Commission completed the auction of 422 C and F 
Broadband PCS licenses in Auction 35. Of the 35 winning bidders in 
this auction, 29 qualified as ``small'' or ``very small'' 
businesses.\115\ 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. In 2005, the Commission 
completed an auction of 188 C block licenses and 21 F block licenses 
in Auction 58. There were 24 winning bidders for 217 licenses.\116\ 
Of the 24 winning bidders, 16 claimed small business status and won 
156 licenses. In 2007, the Commission completed an auction of 33 
licenses in the A, C, and F Blocks in Auction 71.\117\ Of the 14 
winning bidders, six were designated entities.\118\ In 2008, the 
Commission completed an auction of 20 Broadband PCS licenses in the 
C, D, E and F block licenses in Auction 78.\119\
---------------------------------------------------------------------------

    \115\ See ``C and F Block Broadband PCS Auction Closes; Winning 
Bidders Announced,'' public notice, 16 FCC Rcd 2339 (2001).
    \116\ See ``Broadband PCS Spectrum Auction Closes; Winning 
Bidders Announced for Auction No. 58,'' public notice, 20 FCC Rcd 
3703 (2005).
    \117\ See ``Auction of Broadband PCS Spectrum Licenses Closes; 
Winning Bidders Announced for Auction No. 71,'' public notice, 22 
FCC Rcd 9247 (2007).
    \118\ Id.
    \119\ See Auction of AWS-1 and Broadband PCS Licenses 
Rescheduled for August 13, 2008, Notice of Filing Requirements, 
Minimum Opening Bids, Upfront Payments and Other Procedures For 
Auction 78, public notice, 23 FCC Rcd 7496 (2008) (``AWS-1 and 
Broadband PCS Procedures Public Notice'').
---------------------------------------------------------------------------

    30. Advanced Wireless Services. In 2008, the Commission 
conducted the auction of Advanced Wireless Services (``AWS'') 
licenses.\120\ This auction, which as designated as Auction 78, 
offered 35 licenses in the AWS 1710-1755 MHz and 2110-2155 MHz bands 
(``AWS-1''). The AWS-1 licenses were licenses for which there were 
no winning bids in Auction 66. That same year, the Commission 
completed Auction 78. A bidder with attributed average annual gross 
revenues that exceeded $15 million and did not exceed $40 million 
for the preceding three years (``small business'') received a 15 
percent discount on its winning bid. A bidder with attributed 
average annual gross revenues that did not exceed $15 million for 
the preceding three years (``very small business'') received a 25 
percent discount on its winning bid. A bidder that had combined 
total assets of less than $500 million and combined gross revenues 
of less than $125 million in each of the last two years qualified 
for entrepreneur status.\121\ Four winning bidders that identified 
themselves as very small businesses won 17 licenses.\122\ Three of 
the winning bidders that identified themselves as a small business 
won five licenses. Additionally, one other winning bidder that 
qualified for entrepreneur status won 2 licenses.
---------------------------------------------------------------------------

    \120\ See AWS-1 and Broadband PCS Procedures Public Notice, 23 
FCC Rcd 7496. Auction 78 also included an auction of Broadband PCS 
licenses.
    \121\ Id. at 23 FCC Rcd at 7521-22.
    \122\ See ``Auction of AWS-1 and Broadband PCS Licenses Closes, 
Winning Bidders Announced for Auction 78, Down Payments Due 
September 9, 2008, FCC Forms 601 and 602 Due September 9, 2008, 
Final Payments Due September 23, 2008, Ten-Day Petition to Deny 
Period'', public notice, 23 FCC Rcd 12749-65 (2008).
---------------------------------------------------------------------------

    31. Narrowband Personal Communications Services. In 1994, the 
Commission conducted an auction for Narrowband PCS licenses. A 
second auction was also conducted later in 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.\123\ Through these auctions, the 
Commission awarded a total of 41 licenses, 11 of which were obtained 
by four small businesses.\124\ 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.\125\ 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.\126\ 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.\127\ The SBA has approved these small business size 
standards.\128\ A third auction was conducted in 2001. Here, five 
bidders won 317 (Metropolitan Trading Areas and nationwide) 
licenses.\129\ Three of these claimed status as a small or very 
small entity and won 311 licenses.
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    \123\ 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).
    \124\ 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).
    \125\ 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'').
    \126\ Narrowband PCS Second Report and Order, 15 FCC Rcd at 
10476, para. 40.
    \127\ Id.
    \128\ See Alvarez Letter 1998.
    \129\ See ``Narrowband PCS Auction Closes,'' public notice, 16 
FCC Rcd 18663 (WTB 2001).
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    32. 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.\130\ 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.\131\ A ``very small business'' is defined 
as an entity that, together with its affiliates and controlling 
principals, has average gross revenues that are not more than $15 
million for the preceding three years.\132\ 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.\133\ The SBA approved these small size standards.\134\ 
The Commission conducted an auction in 2002 of 740 licenses (one 
license in each of the 734 MSAs/RSAs and one license in each of the 
six Economic Area Groupings (EAGs)). 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. 
\135\ The Commission conducted a second auction in 2003 that 
included 256 licenses: 5 EAG licenses and 476 Cellular Market Area

[[Page 21555]]

licenses.\136\ 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.\137\ In 2005, the 
Commission completed an auction of 5 licenses in the lower 700 MHz 
band (Auction 60). There were three winning bidders for five 
licenses. All three winning bidders claimed small business status.
---------------------------------------------------------------------------

    \130\ 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'').
    \131\ See Channels 52-59 Report and Order, 17 FCC Rcd at 1087-
88, para. 172.
    \132\ See id.
    \133\ See id., 17 FCC Rcd at 1088, para. 173.
    \134\ See Letter from Aida Alvarez, Administrator, SBA, to 
Thomas Sugrue, Chief, WTB, FCC (Aug. 10, 1999) (``Alvarez Letter 
1999'').
    \135\ See ``Lower 700 MHz Band Auction Closes,'' public notice, 
17 FCC Rcd 17272 (WTB 2002).
    \136\ See ``Lower 700 MHz Band Auction Closes,'' public notice, 
18 FCC Rcd 11873 (WTB 2003).
    \137\ See id.
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    33. In 2007, the Commission adopted the 700 MHz Second Report 
and Order.\138\ The Order revised the band plan for the commercial 
(including Guard Band) and public safety spectrum, adopted services 
rules, including stringent build-out requirements, an open platform 
requirement on the C Block, and a requirement on the D Block 
licensee to construct and operate a nationwide, interoperable 
wireless broadband network for public safety users. In 2008, the 
Commission commenced Auction 73 which offered all available, 
commercial 700 MHz Band licenses (1,099 licenses) for bidding using 
the Commission's standard simultaneous multiple-round (``SMR'') 
auction format for the A, B, D, and E block licenses and an SMR 
auction design with hierarchical package bidding (``HPB'') for the C 
Block licenses. Later in 2008, the Commission concluded Auction 
73.\139\ A bidder with attributed average annual gross revenues that 
did not exceed $15 million for the preceding three years (very small 
business) qualified for a 25 percent discount on its winning bids. A 
bidder with attributed average annual gross revenues that exceeded 
$15 million, but did not exceed $40 million for the preceding three 
years, qualified for a 15 percent discount on its winning bids. 
There were 36 winning bidders (who won 330 of the 1,090 licenses 
won) that identified themselves as very small businesses. There were 
20 winning bidders that identified themselves as a small business 
that won 49 of the 1,090 licenses won.\140\ The provisionally 
winning bids for the A, B, C, and E Block licenses exceeded the 
aggregate reserve prices for those blocks. However, the 
provisionally winning bid for the D Block license did not meet the 
applicable reserve price and thus did not become a winning bid.\141\
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    \138\ Service Rules for the 698-746, 747-762 and 777-792 MHz 
Band, 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 Telephone, 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 No. 03-264, Former Nextel Communications, Inc. 
Upper700 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''), 22 FCC Rcd 15289 (2007).
    \139\ Auction of 700 MHz Band Licenses Closes, Winning Bidders 
Announced for Auction 73, Down Payments Due April 3, 2008, FCC Forms 
601 and 602 April 3, 2008, Final Payment Due April 17, 2008, Ten-Day 
Petition to Deny Period, Public Notice, 23 FCC Rcd 4572 (2008).
    \140\ Id. 23 FCC Rcd at 4572-73.
    \141\ Id.
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    34. 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.\142\ 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.\143\ 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.\144\ SBA approval of 
these definitions is not required.\145\ In 2000, the Commission 
conducted an auction of 52 Major Economic Area (``MEA'') 
licenses.\146\ 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 and closed in 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.\147\
---------------------------------------------------------------------------

    \142\ 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'').
    \143\ See 746-764 MHz Band Second Report and Order, 15 FCC Rcd 
at 5343, para. 108.
    \144\ See id.
    \145\ 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).
    \146\ See ``700 MHz Guard Bands Auction Closes: Winning Bidders 
Announced,'' public notice, 15 FCC Rcd 18026 (2000).
    \147\ See ``700 MHz Guard Bands Auction Closes: Winning Bidders 
Announced,'' public notice, 16 FCC Rcd 4590 (WTB 2001).
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    35. 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.\148\ 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.\149\ 
The SBA has approved these small business size standards for the 900 
MHz Service.\150\ The Commission has held auctions for geographic 
area licenses in the 800 MHz and 900 MHz bands. The 900 MHz SMR 
auction was completed in 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 was conducted in 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.\151\ A second 
auction for the 800 MHz band was conducted in 2002 and included 23 
BEA licenses. One bidder claiming small business status won five 
licenses.\152\
---------------------------------------------------------------------------

    \148\ 47 CFR 90.814(b)(1).
    \149\ 47 CFR 90.814(b)(1).
    \150\ See Alvarez Letter 1999.
    \151\ 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).
    \152\ See ``Multi-Radio Service Auction Closes,'' public notice, 
17 FCC Rcd 1446 (WTB 2002).
---------------------------------------------------------------------------

    36. The auction of the 1,053 800 MHz SMR geographic area 
licenses for the General Category channels was conducted in 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.\153\ In an auction 
completed in 2000, a total of 2,800 Economic Area licenses in the 
lower 80 channels of the 800 MHz SMR service were awarded.\154\ 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.
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    \153\ 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).
    \154\ See, ``800 MHz SMR Service Lower 80 Channels Auction 
Closes; Winning Bidders Announced,'' public notice, 16 FCC Rcd 1736 
(2000).
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    37. 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. In addition, we do not know how many of these 
firms have 1,500 or fewer employees.\155\ 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.
---------------------------------------------------------------------------

    \155\ See generally 13 CFR 121.201, NAICS code 517210.
---------------------------------------------------------------------------

    38. 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.

[[Page 21556]]

To estimate the number of such licensees that are small businesses, 
we apply the small business size standard under the SBA rules 
applicable to Wireless Telecommunications Carriers (except 
Satellite).\156\ This category provides that a small business is a 
wireless company employing no more than 1,500 persons.\157\ The 
Commission estimates that most such licensees are small businesses 
under the SBA's small business standard.
---------------------------------------------------------------------------

    \156\ Id.
    \157\ Id.
---------------------------------------------------------------------------

    39. 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.\158\ 
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.\159\ 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.\160\ The SBA has approved these small 
size standards.\161\ Auctions of Phase II licenses commenced on and 
closed in 1998.\162\ 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.\163\ 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.\164\ 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.\165\ In 2007, the Commission conducted a fourth 
auction of the 220 MHz licenses.\166\ Bidding credits were offered 
to small businesses. A bidder with attributed average annual gross 
revenues that exceeded $3 million and did not exceed $15 million for 
the preceding three years (``small business'') received a 25 percent 
discount on its winning bid. A bidder with attributed average annual 
gross revenues that did not exceed $3 million for the preceding 
three years received a 35 percent discount on its winning bid 
(``very small business''). Auction 72, which offered 94 Phase II 220 
MHz Service licenses, concluded in 2007.\167\ In this auction, five 
winning bidders won a total of 76 licenses. Two winning bidders 
identified themselves as very small businesses won 56 of the 76 
licenses. One of the winning bidders that identified themselves as a 
small business won 5 of the 76 licenses won.
---------------------------------------------------------------------------

    \158\ 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).
    \159\ Id. at 11068, para. 291.
    \160\ Id.
    \161\ See Letter from Aida Alvarez, Administrator, SBA, to 
Daniel Phythyon, Chief, WTB, FCC (Jan. 6, 1998) (``Alvarez to 
Phythyon Letter 1998'').
    \162\ See generally ``220 MHz Service Auction Closes,'' public 
notice, 14 FCC Rcd 605 (1998).
    \163\ 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).
    \164\ See ``Phase II 220 MHz Service Spectrum Auction Closes,'' 
public notice, 14 FCC Rcd 11218 (1999).
    \165\ See ``Multi-Radio Service Auction Closes,'' public notice, 
17 FCC Rcd 1446 (2002).
    \166\ See ``Auction of Phase II 220 MHz Service Spectrum 
Scheduled for June 20, 2007, Notice and Filing Requirements, Minimum 
Opening Bids, Upfront Payments and Other Procedures for Auction 72, 
public notice, 22 FCC Rcd 3404 (2007).
    \167\ See ``Auction of Phase II 220 MHz Service Spectrum 
Licenses Closes, Winning Bidders Announced for Auction 72, Down 
Payments due July 18, 2007, FCC Forms 601 and 602 due July 18, 2007, 
Final Payments due August 1, 2007, Ten-Day Petition to Deny Period, 
public notice, 22 FCC Rcd 11573 (2007).
---------------------------------------------------------------------------

    40. Cellular Radiotelephone Service. Auction 77 was held to 
resolve one group of mutually exclusive applications for Cellular 
Radiotelephone Service licenses for unserved areas in New 
Mexico.\168\ Bidding credits for designated entities were not 
available in Auction 77.\169\ In 2008, the Commission completed the 
closed auction of one unserved service area in the Cellular 
Radiotelephone Service, designated as Auction 77. Auction 77 
concluded with one provisionally winning bid for the unserved area 
totaling $25,002.\170\
---------------------------------------------------------------------------

    \168\ See Closed Auction of Licenses for Cellular Unserved 
Service Area Scheduled for June 17, 2008, Notice and Filing 
Requirements, Minimum Opening Bids, Upfront Payments, and Other 
Procedures for Auction 77, public notice, 23 FCC Rcd 6670 (2008).
    \169\ Id. at 6685.
    \170\ See Auction of Cellular Unserved Service Area License 
Closes, Winning Bidder Announced for Auction 77, Down Payment due 
July 2, 2008, Final Payment due July 17, 2008, public notice, 23 FCC 
Rcd 9501 (2008).
---------------------------------------------------------------------------

    41. 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, Wireless 
Telecommunications Carriers (except Satellite). This definition 
provides that a small entity is any such entity employing no more 
than 1,500 persons.\171\ 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.\172\
---------------------------------------------------------------------------

    \171\ See 13 CFR 121.201, NAICS code 517210.
    \172\ See generally 13 CFR 121.201.
---------------------------------------------------------------------------

    42. As of March 2010, there were 424,162 PLMR licensees 
operating 921,909 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 any revised rules in this context 
could therefore potentially impact small entities covering a great 
variety of industries.
    43. Fixed Microwave Services. Fixed microwave services include 
common carrier,\173\ private operational-fixed,\174\ and broadcast 
auxiliary radio services.\175\ 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 Wireless 
Telecommunications Carriers (except Satellite), which is 1,500 or 
fewer employees.\176\ 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.
---------------------------------------------------------------------------

    \173\ See 47 CFR 101 et seq. for common carrier fixed microwave 
services (except Multipoint Distribution Service).
    \174\ 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.
    \175\ 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.
    \176\ 13 CFR 121.201, NAICS code 517210.
---------------------------------------------------------------------------

    44. 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.\177\ An

[[Page 21557]]

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.\178\ 
The SBA has approved these small business size standards.\179\ The 
auction of the 2,173, 39 GHz licenses, began and closed in 2000. The 
18 bidders who claimed small business status won 849 licenses.
---------------------------------------------------------------------------

    \177\ 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).
    \178\ Id.
    \179\ 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).
---------------------------------------------------------------------------

    45. 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.\180\ The auction of the 986 LMDS licenses began 
and closed in 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.\181\ 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.\182\ The SBA has approved 
these small business size standards in the context of LMDS 
auctions.\183\ 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. In 1999, the Commission re-auctioned 161 licenses; 
there were 32 small and very small businesses winning that won 119 
licenses.
---------------------------------------------------------------------------

    \180\ 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'').
    \181\ See LMDS Second Report and Order, 12 FCC Rcd at 12689-90, 
para. 348.
    \182\ See id.
    \183\ See Alvarez to Phythyon Letter 1998.
---------------------------------------------------------------------------

    46. 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'').\184\ 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.\185\ 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.\186\ 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.\187\ The SBA has approved of these 
definitions.\188\ 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.
---------------------------------------------------------------------------

    \184\ See ``Interactive Video and Data Service (IVDS) 
Applications Accepted for Filing,'' public notice, 9 FCC Rcd 6227 
(1994).
    \185\ Implementation of Section 309(j) of the Communications 
Act--Competitive Bidding, Fourth Report and Order, 9 FCC Rcd 2330 
(1994).
    \186\ 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).
    \187\ Id.
    \188\ See Alvarez to Phythyon Letter 1998.
---------------------------------------------------------------------------

    47. 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.\189\ 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.\190\ These definitions have been approved by 
the SBA.\191\ An auction for LMS licenses commenced and closed in 
1999. Of the 528 licenses auctioned, 289 licenses were sold to four 
small businesses.
---------------------------------------------------------------------------

    \189\ 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.
    \190\ Automatic Vehicle Monitoring Systems Second Report and 
Order, 13 FCC Rcd at 15192, para. 20; see also 47 CFR 90.1103.
    \191\ See Alvarez Letter 1998.
---------------------------------------------------------------------------

    48. Rural Radiotelephone Service. The Commission has not adopted 
a size standard for small businesses specific to the Rural 
Radiotelephone Service.\192\ A significant subset of the Rural 
Radiotelephone Service is the Basic Exchange Telephone Radio System 
(``BETRS'').\193\ In the present context, we will use the SBA's 
small business size standard applicable to Wireless 
Telecommunications Carriers (except Satellite), i.e., an entity 
employing no more than 1,500 persons.\194\ 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.
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    \192\ The service is defined in section 22.99 of the 
Commission's rules, 47 CFR 22.99.
    \193\ BETRS is defined in sections 22.757 and 22.759 of the 
Commission's rules, 47 CFR 22.757 and 22.759.
    \194\ 13 CFR 121.201, NAICS code 517210.
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    49. Air-Ground Radiotelephone Service.\195\ The Commission has 
previously used the SBA's small business definition applicable to 
Wireless Telecommunications Carriers (except Satellite), i.e., an 
entity employing no more than 1,500 persons.\196\ 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.\197\ 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.\198\ These 
definitions were approved by the SBA.\199\ In 2006, the Commission 
completed an auction of nationwide commercial Air-Ground 
Radiotelephone Service licenses in the 800 MHz band (Auction 65). 
Later in 2006, the auction closed with two winning bidders winning 
two Air-Ground Radiotelephone Services licenses. Neither of the 
winning bidders claimed small business status.
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    \195\ The service is defined in section 22.99 of the 
Commission's rules, 47 CFR 22.99.
    \196\ 13 CFR 121.201, NAICS codes 517210.
    \197\ 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, paras. 28-42 (2005).
    \198\ Id.
    \199\ See Letter from Hector V. Barreto, Administrator, SBA, to 
Gary D. Michaels, Deputy Chief, Auctions and Spectrum Access 
Division, WTB, FCC (Sept. 19, 2005).
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    50. Aviation and Marine Radio Services. There are approximately 
26,162 aviation, 34,555 marine (ship), and 3,296 marine (coast) 
licensees.\200\ 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 Wireless Telecommunications

[[Page 21558]]

Carriers (except Satellite), which is 1,500 or fewer employees.\201\ 
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.\202\ In 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 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.\203\ 
Further, the Commission made available Automated Maritime 
Telecommunications System (``AMTS'') licenses in Auctions 57 and 
61.\204\ Winning bidders could claim status as a very small business 
or a 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.\205\ 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.
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    \200\ 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).
    \201\ 13 CFR 121.201, NAICS code 517210.
    \202\ A licensee may have a license in more than one category.
    \203\ 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).
    \204\ 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).
    \205\ 47 CFR 80.1252.
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    51. 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.\206\ 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 Wireless Telecommunications Carriers 
(except Satellite) services.\207\ Under that SBA small business size 
standard, a business is small if it has 1,500 or fewer 
employees.\208\
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    \206\ This service is governed by subpart I of part 22 of the 
Commission's rules. See 47 CFR 22.1001-22.1037.
    \207\ 13 CFR 121.201, NAICS code 517210.
    \208\ Id.
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    52. 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.\209\ ``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.\210\ The SBA has approved of these definitions.\211\ 
The majority of these entities will most likely be licensed in bands 
where the Commission has implemented a geographic area licensing 
approach that would require the use of competitive bidding 
procedures to resolve mutually exclusive applications. The 
Commission's licensing database indicates that, as of March 5, 2010, 
there were over 11,500 MAS station authorizations. In addition, an 
auction for 5,104 MAS licenses in 176 EAs was conducted in 
2001.\212\ Seven winning bidders claimed status as small or very 
small businesses and won 611 licenses. In 2005, the Commission 
completed an auction (Auction 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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    \209\ See Amendment of the Commission's Rules Regarding Multiple 
Address Systems, Report and Order, 15 FCC Rcd 11956, 12008, para. 
123 (2000).
    \210\ Id.
    \211\ See Alvarez Letter 1999.
    \212\ See ``Multiple Address Systems Spectrum Auction Closes,'' 
public notice, 16 FCC Rcd 21011 (2001).
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    53. 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 Wireless Telecommunications Carriers 
(except Satellite). This definition provides that a small entity is 
any such entity employing no more than 1,500 persons.\213\ 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.
---------------------------------------------------------------------------

    \213\ See 13 CFR 121.201, NAICS code 517210.
---------------------------------------------------------------------------

    54. 1.4 GHz Band Licensees. The Commission conducted an auction 
of 64 1.4 GHz band licenses \214\ in 2007.\215\ 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.\216\ Neither of the two winning bidders 
sought designated entity status.\217\
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    \214\ See ``Auction of 1.4 GHz Bands Licenses Scheduled for 
February 7, 2007,'' public notice, 21 FCC Rcd 12393 (WTB 2006).
    \215\ 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'').
    \216\ Auction No. 69 Closing PN, Attachment C.
    \217\ See Auction No. 69 Closing PN.
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    55. 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 
Wireless Telecommunications Carriers (except Satellite). This 
category provides that such a company is small if it employs no more 
than 1,500 persons.\218\ The 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 \219\ 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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    \218\ 13 CFR 121.201, NAICS code 517210.
    \219\ 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.
---------------------------------------------------------------------------

    56. 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.\220\ ``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.\221\ The SBA has approved 
these definitions.\222\ 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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    \220\ 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).
    \221\ 24 GHz Report and Order, 15 FCC Rcd at 16967, para. 77; 
see also 47 CFR 101.538(a)(1).
    \222\ 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).
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    57. Broadband Radio Service and Educational Broadband Service. 
Broadband Radio Service systems, previously referred to as 
Multipoint Distribution Service (``MDS'')

[[Page 21559]]

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'')).\223\ In 
connection with the 1996 BRS auction, the Commission established a 
small business size standard as an entity that had annual average 
gross revenues of no more than $40 million in the previous three 
calendar years.\224\ 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.\225\ 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. In 2009, the 
Commission conducted Auction 86, the sale of 78 licenses in the BRS 
areas.\226\ The Commission offered three levels of bidding credits: 
(i) A bidder with attributed average annual gross revenues that 
exceed $15 million and do not exceed $40 million for the preceding 
three years (small business) will receive a 15 percent discount on 
its winning bid; (ii) a bidder with attributed average annual gross 
revenues that exceed $3 million and do not exceed $15 million for 
the preceding three years (very small business) will receive a 25 
percent discount on its winning bid; and (iii) a bidder with 
attributed average annual gross revenues that do not exceed $3 
million for the preceding three years (entrepreneur) will receive a 
35 percent discount on its winning bid.\227\ Auction 86 concluded in 
2009 with the sale of 61 licenses.\228\ Of the ten winning bidders, 
two bidders that claimed small business status won 4 licenses; one 
bidder that claimed very small business status won three licenses; 
and two bidders that claimed entrepreneur status won six licenses.
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    \223\ 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'').
    \224\ 47 CFR 21.961(b)(1).
    \225\ 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.
    \226\ Auction of Broadband Radio Service (BRS) Licenses, 
Scheduled for October 27, 2009, Notice and Filing Requirements, 
Minimum Opening Bids, Upfront Payments, and Other Procedures for 
Auction 86, public notice, 24 FCC Rcd 8277 (2009).
    \227\ Id. at 8296.
    \228\ Auction of Broadband Radio Service Licenses Closes, 
Winning Bidders Announced for Auction 86, Down Payments Due November 
23, 2009, Final Payments Due December 8, 2009, Ten-Day Petition to 
Deny Period, public notice, 24 FCC Rcd 13572 (2009).
---------------------------------------------------------------------------

    58. In addition, the SBA's Cable Television Distribution 
Services 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.\229\ Thus, we estimate 
that at least 1,932 licensees are small businesses. Since 2007, 
Cable Television Distribution Services have been defined within the 
broad economic census category of Wired Telecommunications Carriers; 
that category is defined as follows: ``This industry comprises 
establishments primarily engaged in operating and/or providing 
access to transmission facilities and infrastructure that they own 
and/or lease for the transmission of voice, data, text, sound, and 
video using wired telecommunications networks. Transmission 
facilities may be based on a single technology or a combination of 
technologies.''\230\ The SBA has developed a small business size 
standard for this category, which is: all such firms having 1,500 or 
fewer employees. To gauge small business prevalence for these cable 
services we must, however, use current census data that are based on 
the previous category of Cable and Other Program Distribution and 
its associated size standard; that size standard was: all such firms 
having $13.5 million or less in annual receipts.\231\ According to 
Census Bureau data for 2002, there were a total of 1,191 firms in 
this previous category that operated for the entire year.\232\ 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.\233\ Thus, the majority of these firms can be considered 
small.
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    \229\ 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.
    \230\ U.S. Census Bureau, 2007 NAICS Definitions, ``517110 Wired 
Telecommunications Carriers'' (partial definition); http://www.census.gov/naics/2007/def/ND517110.HTM#N517110.
    \231\ 13 CFR 121.201, NAICS code 517110.
    \232\ U.S. Census Bureau, 2002 Economic Census, Subject Series: 
Information, Table 4, Receipts Size of Firms for the United States: 
2002, NAICS code 517510 (issued November 2005).
    \233\ Id. An additional 61 firms had annual receipts of $25 
million or more.
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    59. Television Broadcasting. This Economic Census category 
``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.'' \234\ The SBA has created 
the following small business size standard for Television 
Broadcasting firms: those having $14 million or less in annual 
receipts.\235\ The Commission has estimated the number of licensed 
commercial television stations to be 1,395.\236\ In addition, 
according to Commission staff review of the BIA Publications, Inc., 
Master Access Television Analyzer Database (BIA) on March 30, 2007, 
about 986 of an estimated 1,395 commercial television stations (or 
approximately 72 percent) had revenues of $13 million or less.\237\ 
We therefore estimate that the majority of commercial television 
broadcasters are small entities.
---------------------------------------------------------------------------

    \234\ U.S. Census Bureau, 2007 NAICS Definitions, ``515120 
Television Broadcasting'' (partial definition); http://www.census.gov/naics/2007/def/ND515120.HTM#N515120.
    \235\ 13 CFR 121.201, NAICS code 515120 (updated for inflation 
in 2008).
    \236\ See FCC News Release, ``Broadcast Station Totals as of 
June 30, 2009,'' dated September 4, 2009; http://www.fcc.gov/Daily_Releases/Daily_Business/2008/db0318/DOC-280836A1.pdf.
    \237\ We recognize that BIA's estimate differs slightly from the 
FCC total given supra.
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    60. We note, however, that in assessing whether a business 
concern qualifies as small under the above definition, business 
(control) affiliations \238\ 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. 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 does not exclude any 
television station from the definition of a small business on this 
basis and is therefore possibly over-inclusive to that extent.
---------------------------------------------------------------------------

    \238\ ``[Business 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 21.103(a)(1).
---------------------------------------------------------------------------

    61. In addition, the Commission has estimated the number of 
licensed noncommercial educational (NCE) television stations to be 
390.\239\ These stations are non-profit, and therefore considered to 
be small entities.\240\
---------------------------------------------------------------------------

    \239\ See FCC News Release, ``Broadcast Station Totals as of 
June 30, 2009,'' dated September 4, 2009; http://www.fcc.gov/Daily_Releases/Daily_Business/2008/db0318/DOC-280836A1.pdf.
    \240\ See generally 5 U.S.C. 601(4), (6).
---------------------------------------------------------------------------

    62. In addition, there are also 2,386 low power television 
stations (LPTV).\241\ 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.
---------------------------------------------------------------------------

    \241\ See FCC News Release, ``Broadcast Station Totals as of 
June 30, 2009,'' dated September 4, 2009; http://www.fcc.gov/Daily_Releases/Daily_Business/2008/db0318/DOC-280836A1.pdf.
---------------------------------------------------------------------------

    63. Radio Broadcasting. This Economic Census category 
``comprises establishments primarily engaged in broadcasting aural 
programs by radio to the public. Programming may originate in their 
own

[[Page 21560]]

studio, from an affiliated network, or from external sources.'' 
\242\ The SBA has established a small business size standard for 
this category, which is: such firms having $7 million or less in 
annual receipts.\243\ According to Commission staff review of BIA 
Publications, Inc.'s Master Access Radio Analyzer Database on March 
31, 2005, about 10,840 (95%) of 11,410 commercial radio stations had 
revenues of $6 million or less. Therefore, the majority of such 
entities are small entities.
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    \242\ U.S. Census Bureau, 2007 NAICS Definitions, ``515112 Radio 
Stations''; http://www.census.gov/naics/2007/def/ND515112.HTM#N515112.
    \243\ 13 CFR 121.201, NAICS code 515112 (updated for inflation 
in 2008).
---------------------------------------------------------------------------

    64. We note, however, that in assessing whether a business 
concern qualifies as small under the above size standard, business 
affiliations must be included.\244\ In addition, to be determined to 
be a ``small business,'' the entity may not be dominant in its field 
of operation.\245\ We note that it is difficult at times to assess 
these criteria in the context of media entities, and our estimate of 
small businesses may therefore be over-inclusive.
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    \244\ ``Concerns and entities are affiliates of each other when 
one controls or has the power to control the other, or a third party 
or parties controls or has the power to control both. It does not 
matter whether control is exercised, so long as the power to control 
exists.'' 13 CFR 121.103(a)(1) (an SBA regulation).
    \245\ 13 CFR 121.102(b) (an SBA regulation).
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    65. 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.\246\
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    \246\ 13 CFR 121.201, NAICS codes 515112 and 515120.
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    66. The Commission estimates that there are approximately 5,618 
FM translators and boosters.\247\ The Commission does not collect 
financial information on any broadcast facility, and the Department 
of Commerce does not collect financial information on these 
auxiliary broadcast facilities. We believe that most, if not all, of 
these auxiliary facilities could be classified as small businesses 
by themselves. We also recognize that most commercial translators 
and boosters are owned by a parent station which, in some cases, 
would be covered by the revenue definition of small business entity 
discussed above. These stations would likely have annual revenues 
that exceed the SBA maximum to be designated as a small business 
($7.0 million for a radio station or $14.0 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.\248\
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    \247\ See supra note 242.
    \248\ See 15 U.S.C. 632.
---------------------------------------------------------------------------

    67. Cable Television Distribution Services. Since 2007, these 
services have been defined within the broad economic census category 
of Wired Telecommunications Carriers; that category is defined as 
follows: ``This industry comprises establishments primarily engaged 
in operating and/or providing access to transmission facilities and 
infrastructure that they own and/or lease for the transmission of 
voice, data, text, sound, and video using wired telecommunications 
networks. Transmission facilities may be based on a single 
technology or a combination of technologies.'' \249\ The SBA has 
developed a small business size standard for this category, which 
is: all such firms having 1,500 or fewer employees. To gauge small 
business prevalence for these cable services we must, however, use 
current census data that are based on the previous category of Cable 
and Other Program Distribution and its associated size standard; 
that size standard was: all such firms having $13.5 million or less 
in annual receipts.\250\ According to Census Bureau data for 2002, 
there were a total of 1,191 firms in this previous category that 
operated for the entire year.\251\ 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.\252\ Thus, the 
majority of these firms can be considered small.
---------------------------------------------------------------------------

    \249\ U.S. Census Bureau, 2007 NAICS Definitions, ``517110 Wired 
Telecommunications Carriers'' (partial definition); http://www.census.gov/naics/2007/def/ND517110.HTM#N517110.
    \250\ 13 CFR 121.201, NAICS code 517110.
    \251\ U.S. Census Bureau, 2002 Economic Census, Subject Series: 
Information, Table 4, Receipts Size of Firms for the United States: 
2002, NAICS code 517510 (issued November 2005).
    \252\ Id. An additional 61 firms had annual receipts of $25 
million or more.
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    68. 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.\253\ Industry data indicate that, of 1,076 cable 
operators nationwide, all but eleven are small under this size 
standard.\254\ In addition, under the Commission's rules, a ``small 
system'' is a cable system serving 15,000 or fewer subscribers.\255\ 
Industry data indicate that, of 6,635 systems nationwide, 5,802 
systems have under 10,000 subscribers, and an additional 302 systems 
have 10,000-19,999 subscribers.\256\ Thus, under this second size 
standard, most cable systems are small.
---------------------------------------------------------------------------

    \253\ 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).
    \254\ 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.
    \255\ 47 CFR 76.901(c).
    \256\ Warren Communications News, Television & Cable Factbook 
2008, ``U.S. Cable Systems by Subscriber Size,'' page F-2 (data 
current as of Oct. 2007). The data do not include 851 systems for 
which classifying data were not available.
---------------------------------------------------------------------------

    69. 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.'' \257\ 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.\258\ Industry data indicate that, of 1,076 cable 
operators nationwide, all but ten are small under this size 
standard.\259\ 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,\260\ 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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    \257\ 47 U.S.C. 543(m)(2); see 47 CFR 76.901(f) & nn. 1-3.
    \258\ 47 CFR 76.901(f); see public notice, FCC Announces New 
Subscriber Count for the Definition of Small Cable Operator, DA 01-
158 (Cable Services Bureau, Jan. 24, 2001).
    \259\ 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.
    \260\ 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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    70. Open Video Systems. The open video system (``OVS'') 
framework was established in 1996, and is one of four statutorily 
recognized options for the provision of video programming services 
by local exchange carriers.\261\ The OVS framework provides 
opportunities for the distribution of video programming other than 
through cable systems. Because OVS operators provide subscription 
services,\262\ OVS falls within the SBA small business size standard 
covering cable services, which is ``Wired Telecommunications 
Carriers.'' \263\ The SBA has developed a small business size 
standard for this category, which is: all such firms having 1,500 or 
fewer employees. To gauge small business prevalence for such 
services we must, however, use current census data that are based on 
the previous category of

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Cable and Other Program Distribution and its associated size 
standard; that size standard was: all such firms having $13.5 
million or less in annual receipts.\264\ According to Census Bureau 
data for 2002, there were a total of 1,191 firms in this previous 
category that operated for the entire year.\265\ 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.\266\ 
Thus, the majority of cable firms can be considered small. In 
addition, we note that the Commission has certified some OVS 
operators, with some now providing service.\267\ Broadband service 
providers (``BSPs'') are currently the only significant holders of 
OVS certifications or local OVS franchises.\268\ The Commission does 
not have financial or employment information regarding the entities 
authorized to provide OVS, some of which may not yet be operational. 
Thus, again, at least some of the OVS operators may qualify as small 
entities.
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    \261\ 47 U.S.C. 571(a)(3)-(4). See Annual Assessment of the 
Status of Competition in the Market for the Delivery of Video 
Programming, Thirteenth Annual Report, 24 FCC Rcd 542, 606 para. 135 
(2009) (``Thirteenth Annual Cable Competition Report'').
    \262\ See 47 U.S.C. 573.
    \263\ U.S. Census Bureau, 2007 NAICS Definitions, ``517110 Wired 
Telecommunications Carriers''; http://www.census.gov/naics/2007/def/ND517110.HTM#N517110.
    \264\ 13 CFR 121.201, NAICS code 517110.
    \265\ U.S. Census Bureau, 2002 Economic Census, Subject Series: 
Information, Table 4, Receipts Size of Firms for the United States: 
2002, NAICS code 517510 (issued November 2005).
    \266\ Id. An additional 61 firms had annual receipts of $25 
million or more.
    \267\ A list of OVS certifications may be found at http://www.fcc.gov/mb/ovs/csovscer.html.
    \268\ See Thirteenth Annual Cable Competition Report, 24 FCC Rcd 
at 606-07 para. 135. BSPs are newer firms that are building state-
of-the-art, facilities-based networks to provide video, voice, and 
data services over a single network.
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    71. Cable Television Relay Service. This service includes 
transmitters generally used to relay cable programming within cable 
television system distribution systems. This cable service is 
defined within the broad economic census category of Wired 
Telecommunications Carriers; that category is defined as follows: 
``This industry comprises establishments primarily engaged in 
operating and/or providing access to transmission facilities and 
infrastructure that they own and/or lease for the transmission of 
voice, data, text, sound, and video using wired telecommunications 
networks. Transmission facilities may be based on a single 
technology or a combination of technologies.'' \269\ The SBA has 
developed a small business size standard for this category, which 
is: all such firms having 1,500 or fewer employees. To gauge small 
business prevalence for cable services we must, however, use current 
census data that are based on the previous category of Cable and 
Other Program Distribution and its associated size standard; that 
size standard was: 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 previous 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, the 
majority of these firms can be considered small.
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    \269\ U.S. Census Bureau, 2007 NAICS Definitions, ``517110 Wired 
Telecommunications Carriers'' (partial definition); http://www.census.gov/naics/2007/def/ND517110.HTM#N517110.
    \270\ 13 CFR 121.201, NAICS code 517110.
    \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 (issued November 2005).
    \272\ Id. An additional 61 firms had annual receipts of $25 
million or more.
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    72. 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 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).
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    73. Amateur Radio Service. These licensees are held by 
individuals in a noncommercial capacity; these licensees are not 
small entities.
    74. 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 Wireless 
Telecommunications Carriers (except Satellite), 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.
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    \277\ 13 CFR 121.201, NAICS code 517210.
    \278\ Amendment of the Commission's Rules Concerning Maritime 
Communications, Third Report and Order and Memorandum Opinion and 
Order, 13 FCC Rcd 19853 (1998).
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    75. 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 Wireless Telecommunications 
Carriers (except Satellite), pursuant to which a small entity is 
defined as employing 1,500 or fewer

[[Page 21562]]

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 517210.
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    76. 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\
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    \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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    77. Internet Service Providers. The 2007 Economic Census places 
these firms, whose services might include voice over Internet 
protocol (VoIP), in either of two categories, depending on whether 
the service is provided over the provider's own telecommunications 
connections (e.g. cable and DSL, ISPs), or over client-supplied 
telecommunications connections (e.g. dial-up ISPs). The former are 
within the category of Wired Telecommunications Carriers,\285\ which 
has an SBA small business size standard of 1,500 or fewer 
employees.\286\ The latter are within the category of All Other 
Telecommunications,\287\ which has a size standard of annual 
receipts of $25 million or less.\288\ The most current Census Bureau 
data for all such firms, however, are the 2002 data for the previous 
census category called Internet Service Providers.\289\ That 
category had a small business size standard of $21 million or less 
in annual receipts, which was revised in late 2005 to $23 million. 
The 2002 data show that there were 2,529 such firms that operated 
for the entire year.\290\ Of those, 2,437 firms had annual receipts 
of under $10 million, and an additional 47 firms had receipts of 
between $10 million and $24,999,999.\291\ Consequently, we estimate 
that the majority of ISP firms are small entities.
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    \285\ U.S. Census Bureau, 2007 NAICS Definitions, ``517110 Wired 
Telecommunications Carriers'', http://www.census.gov/naics/2007/def/ND517110.HTM#N517110.
    \286\ 13 CFR 121.201, NAICS code 517110 (updated for inflation 
in 2008).
    \287\ U.S. Census Bureau, 2007 NAICS Definitions, ``517919 All 
Other Telecommunications''; http://www.census.gov/naics/2007/def/ND517919.HTM#N517919.
    \288\ 13 CFR 121.201, NAICS code 517919 (updated for inflation 
in 2008).
    \289\ U.S. Census Bureau, 2002 NAICS Definitions, ``518111 
Internet Service Providers''; http://www.census.gov/eped/naics02/def/NDEF518.HTM.
    \290\ U.S. Census Bureau, 2002 Economic Census, Subject Series: 
Information, ``Establishment and Firm Size (Including Legal Form of 
Organization),'' Table 4, NAICS code 518111 (issued Nov. 2005).
    \291\ An additional 45 firms had receipts of $25 million or 
more.
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    78. The ISP industry has changed dramatically since 2002. The 
2002 data cited above may therefore include entities that no longer 
provide Internet access service and may exclude entities that now 
provide such service. To ensure that this (IRFA/FRFA) describes the 
universe of small entities that our action might affect, we discuss 
in turn several different types of entities that might be providing 
Internet access service.
    79. We note that, although we have no specific information on 
the number of small entities that provide Internet access service 
over unlicensed spectrum, we include these entities in our IRFA/
FRFA.

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

    80. 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.\292\ 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 when they complete and submit the 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.
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    \292\ 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.
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    81. As discussed previously in this Notice of Proposed 
Rulemaking, the Commission concluded in its FY 2009 regulatory fee 
cycle that licensees filing their annual regulatory fee payments 
must begin the process by entering the Commission's Fee Filer system 
with a valid FRN and password. In some instances, it will be 
necessary to use a specific FRN and password that is linked to a 
particular regulatory fee bill. Going forward, the submission of 
hardcopy Form 159 documents will not be permitted for making a 
regulatory fee payment during the regulatory fee cycle. By requiring 
licensees to use Fee Filer to begin the regulatory fee payment 
process, errors resulting from illegible handwriting on hardcopy 
Form 159's will be reduced, and we will create an electronic record 
of licensee payment attributes that are more easily traced than 
those payments that are simply mailed in with a hardcopy Form 159.
    82. 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.\293\ If payment is not received, new 
or pending applications may be dismissed, and existing 
authorizations may be subject to rescission.\294\ 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.\295\ Nonpayment of regulatory fees is a debt owed to 
the United States pursuant to 31 U.S.C. 3711 et seq., and the DCIA. 
Appropriate

[[Page 21563]]

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.\296\
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    \293\ 47 CFR 1.1164.
    \294\ 47 CFR 1.1164(c).
    \295\ Public Law 104-134, 110 Stat. 1321 (1996).
    \296\ 31 U.S.C. 7701(c)(2)(B).
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    83. 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.\297\ 
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 (e.g., 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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    \297\ 47 CFR 1.1166.
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V. Steps Taken To Minimize Significant Economic Impact on Small 
Entities, and Significant Alternatives Considered

    84. The RFA requires an agency to describe any significant 
alternatives that it has considered in reaching its approach, which 
may include the following four alternatives, among others: (1) The 
establishment of differing compliance or reporting requirements or 
timetables that take into account the resources available to small 
entities; (2) the clarification, consolidation, or simplification of 
compliance or reporting requirements under the rule for small 
entities; (3) the use of performance, rather than design, standards; 
and (4) an exemption from coverage of the rule, or any part thereof, 
for small entities.\298\ In this NPRM, we seek 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.
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    \298\ 5 U.S.C. 603.
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    85. 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. We note that small entities should be assisted by our 
implementation of the Fee Filer program, and that we have continued 
our practice of exempting fees whose total sum owed is less than 
$10.00.

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

    86. None.
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[FR Doc. 2010-9553 Filed 4-23-10; 8:45 am]
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