Before the

**Federal Communications Commission**

**Washington, D.C. 20554**

+----------------------------------+---+------------------------------+
| In the Matter of                 | ) | WT Docket No. 99-87          |
|                                  |   |                              |
| Implementation of Sections       | ) |                              |
| 309(j) and                       |   |                              |
|                                  | ) |                              |
| 337 of the Communications Act of |   |                              |
| 1934                             | ) |                              |
|                                  |   |                              |
| as Amended                       | ) |                              |
|                                  |   |                              |
|                                  | ) |                              |
+----------------------------------+---+------------------------------+

MEMORANDUM OPINION AND ORDER

**Adopted: March 14, 2002 Released: April 18, 2002**

By the Commission:

TABLE OF CONTENTS

Paragraph \#

I. INTRODUCTION AND EXECUTIVE
SUMMARY....................................................1

II\.
BACKGROUND...............................................................................................3

III\.
DISCUSSION.................................................................................................13

A. Obligation to Avoid Mutual
Exclusivity...............................................................13

B. Band Manager
Licensing................................................................................16

C. Exemption from Competitive Bidding for Public Safety Radio
Services.........................19

1\. Exemption of Spectrum
Blocks...............................................................22

2\. Private Internal Radio
Service.................................................................29

3\. Dominant Use
Analysis........................................................................32

4\. Protection of Life, Health, or
Property.......................................................37

5\. General
Clarification............................................................................40

D. Licensing of PLMR Channels in the 800 MHz Band for use in CMRS
Systems................44

E. Section 337
Licensing............................................................\........................49

IV\.
CONCLUSION................................................................................................56

V. PROCEDURAL
MATTERS................................................................................57

A. Regulatory Flexibility Act
Analysis...................................................................57

B. Paperwork Reduction Act of 1995
Analysis..........................................................58

C. Further
Information....................................................................................\...59

VI\. ORDERING
CLAUSES.....................................................................................60

APPENDIX A: COMMENTS AND REPLY COMMENTS FILED IN WT DOCKET 99-87

APPENDIX B: FINAL RULES

APPENDIX C: SUPPLEMENTAL FINAL REGULATORY FLEXIBILITY ANALYSIS

# INTRODUCTION AND EXECUTIVE SUMMARY

1.  In the *Report and Order and Further Notice of Proposed Rule Making*
    ("*R&O*" and "*FNPRM*") in this proceeding,[^1] the Commission
    adopted rules and policies to implement Sections 309(j) and 337 of
    the Communications Act of 1934, as amended by the Balanced Budget
    Act of 1997. This *Memorandum Opinion and Order* ("*MO&O*")
    addresses petitions for reconsideration and related pleadings
    regarding certain of our decisions in the *R&O*.

2.  The major decisions in this *MO&O* are as follows:

-   We affirm that the Balanced Budget Act amendments to Section 309(j)
    do not preclude the Commission from using licensing mechanisms for
    private services that permit the filing of mutually exclusive
    license applications if the Commission determines that it is in the
    public interest to do so.

-   We reiterate that the public safety radio services exemption in
    Section 309(j) applies to services, rather than specific users.
    Moreover, we affirm the dominant use test set forth in the *R&O* as
    the means to determine whether the particular service qualifies for
    the public safety radio services exemption. We also retain and
    clarify the definition for "private internal radio service" set
    forth in the *R&O*.

-   We retain the five-year holding period as a requirement for
    modification of a 800 MHz PLMRS authorization to permit commercial
    use.

-   We affirm the decision in the *R&O* that an applicant must
    demonstrate that there is no public safety spectrum available to
    satisfy the public safety service use before it can be granted a
    waiver pursuant to Section 337.

-   We reiterate whether a Section 337 application is in the public
    interest will be determined on a case-by-case examination of various
    factors, including the stage of the competitive bidding process with
    respect to the requested frequencies.

# BACKGROUND

3.  The Omnibus Budget Reconciliation Act of 1993 ("1993 Budget
    Act")[^2] added Section 309(j) to the Communications Act,
    authorizing the Commission to award licenses for use of the
    electromagnetic spectrum through competitive bidding where mutually
    exclusive applications are filed. The 1993 Budget Act expressly
    authorized, but did not require, the Commission to use competitive
    bidding to choose among mutually exclusive applications for initial
    licenses or construction permits.[^3] As the Commission described in
    detail in the *Notice of Proposed Rule Making* in this proceeding
    (*Notice*),[^4] the Commission in a series of rulemaking proceedings
    adopted rules and policies to implement Section 309(j).[^5]

4.  Pursuant to the 1993 Budget Act, Section 309(j)(1), \"General
    Authority,\" only permitted the Commission to use competitive
    bidding for subscriber-based services if mutual exclusivity existed
    among initial license applications. Section 309(j)(6)(E) also made
    clear that the Commission was not relieved of its obligation in the
    public interest to continue to use engineering solutions,
    negotiation, threshold qualifications, service regulations and other
    means to avoid mutual exclusivity.[^6] The Commission has determined
    that applications are "mutually exclusive" if the grant of one
    application would effectively preclude the grant of one or more of
    the other applications.[^7] Where the Commission receives only one
    application that is acceptable for filing for a particular license
    that is otherwise auctionable, there is no mutual exclusivity, and
    thus no auction. Therefore, mutual exclusivity is established when
    competing applications for a license are filed.

5.  Section 309(j)(1) also restricted the use of competitive bidding to
    applications for "initial" licenses or permits.[^8] In addition,
    Section 309(j)(2) set forth conditions beyond mutual exclusivity
    that had to be satisfied in order for spectrum to be
    auctionable.[^9] Generally speaking, these conditions subjected to
    auction those services in which the licensee was to receive
    compensation from subscribers for the use of the spectrum.[^10]
    Former Section 309(j)(2) further directed the Commission, in
    evaluating the "uses to which bidding may apply," to determine
    whether "a system of competitive bidding will promote the \[public
    interest\] objectives described in \[Section 309(j)(3)\]."[^11]
    Employing these criteria, the Commission identified a number of
    services and classes of services that were auctionable and not
    auctionable under the 1993 Budget Act, provided mutually exclusive
    applications were filed.[^12] As the Commission explained in the
    *Notice*, the services deemed nonauctionable under the 1993 Budget
    Act were non-subscriber based, private and noncommercial offerings
    operating on a variety of frequency bands.[^13]

6.  In 1997, Congress revised the Commission's auction authority.
    Specifically, the Balanced Budget Act of 1997 ("Balanced Budget
    Act") amended Section 309(j)(1) to require the Commission to award
    mutually exclusive applications for initial licenses or permits
    using competitive bidding procedures, except as provided in Section
    309(j)(2).[^14] Sections 309(j)(1) and 309(j)(2) now state,

> \(1\) General Authority.\--If, consistent with the obligations
> described in paragraph (6)(E), mutually exclusive applications are
> accepted for any initial license or construction permit, then, except
> as provided in paragraph (2), the Commission shall grant the license
> or permit to a qualified applicant through a system of competitive
> bidding that meets the requirements of this subsection.
>
> \(2\) Exemptions.\--The competitive bidding authority granted by this
> subsection shall not apply to licenses or construction permits issued
> by the Commission\--
>
> \(A\) for public safety radio services, including private internal
> radio services used by State and local governments and non‑government
> entities and including emergency road services provided by
> not‑for‑profit organizations, that\--
>
> \(i\) are used to protect the safety of life, health, or property; and
>
> \(ii\) are not made commercially available to the public;
>
> \(B\) for initial licenses or construction permits for digital
> television service given to existing terrestrial broadcast licensees
> to replace their analog television service licenses; or

\(C\) for stations described in section 397(6)[^15] of this title.[^16]

7.  As mentioned above, prior to the Balanced Budget Act, Section 309(j)
    granted the Commission the authority to use competitive bidding to
    resolve mutually exclusive applications for initial licenses or
    permits if the principal use of the spectrum was for
    subscription-based services and competitive bidding would promote
    the objectives described in Section 309(j)(3).[^17] As amended by
    the Balanced Budget Act, Section 309(j)(1) states that the
    Commission *shall* use competitive bidding to resolve mutually
    exclusive initial license or permit applications, unless one of the
    three exemptions provided in the statute applies.[^18] The
    Commission has found that the list of exemptions from our general
    auction authority set forth in Section 309(j)(2) is exhaustive,
    rather than merely illustrative, of the types of licenses or permits
    that may not be awarded through a system of competitive
    bidding.[^19] Left unchanged by the Balanced Budget Act is Section
    309(j)(3)'s directive to consider the public interest objectives in
    identifying classes of licenses and permits to be issued by
    competitive bidding. Moreover, the general auction authority
    provision of Section 309(j)(1) now references the obligation under
    Section 309(j)(6)(E) to use engineering solutions, negotiation,
    threshold qualifications, service regulations, or other means to
    avoid mutual exclusivity where it is in the public interest to do
    so. In addition, the portion of the Conference Report that
    accompanies this section of the legislation emphasizes that
    notwithstanding the Commission's expanded auction authority, its
    determinations regarding mutual exclusivity must still be consistent
    with and not minimize its obligations under Section
    309(j)(6)(E).[^20]

8.  In the *R&O* in this proceeding, which was initiated by the
    *Notice,* the Commission adopted rules and policies to implement
    Sections 309(j) and 337 of the Communications Act of 1934
    ("Communications Act"), as amended by the Balanced Budget Act. The
    *R&O* provided the general framework for exercise of the
    Commission's auction authority in light of the Balanced Budget Act's
    revisions to Section 309(j).[^21] The Commission concluded that its
    authority under the Balanced Budget Act continues to permit it to
    adopt licensing processes that result in the filing of mutually
    exclusive applications where such an approach would serve the public
    interest.[^22] Further, it concluded that in addition to other
    licensing mechanisms that have been used previously, the use of band
    manager licensing should be considered as a future option for
    private as well as commercial services.[^23]

9.  In addition, the Commission defined the scope of the Balanced Budget
    Act's exemption from auctions for licenses and permits issued for
    "public safety radio services" by concluding that this exemption
    from auctions was intended to apply not only to traditional public
    safety services such as police, fire, and emergency medical
    services, but also to spectrum usage by entities such as utilities,
    railroads, transit systems, and others that provide essential
    services to the public at large and that need reliable
    communications in order to prevent or respond to disasters or crises
    affecting their service to the public.[^24] In that connection, it
    also concluded that the public safety exemption applies only to
    services in which protecting the safety of life, health, or property
    within the meaning of Section 309(j)(2)(A) comprises the dominant
    use of the spectrum.[^25]

10. The Commission also concluded that, subject to certain safeguards to
    prevent trafficking of PLMRS frequencies, 800 MHz Business and
    Industrial/Land Transportation ("I/LT") licensees should be allowed
    to modify their licenses to permit commercial use, or to assign or
    transfer their licenses to commercial operators for commercial
    use.[^26] The Commission prohibited a licensee who modifies,
    transfers or assigns a license under this provision from obtaining
    new Business or I/LT spectrum in the same location for one year,
    and, with respect to licenses applied for after the adoption of the
    *R&O* *and FNPRM*, the Commission prohibited such modifications,
    assignments, or transfers until five years after the initial grant
    date of the license.[^27]

11. In addition, the *R&O* addressed issues relating to the awarding of
    licenses under Section 337 of the Communications Act, which allows
    entities seeking to provide public safety services (defined more
    narrowly than in Section 309(j)(2)(A)) to apply for "unassigned"
    spectrum not otherwise allocated for public safety use. The
    Commission concluded that where it has proposed rules for the
    licensing of particular spectrum by auction and released the public
    notice announcing the auction, requests for licensing under Section
    337 will be scrutinized on a case-by-case basis to determine
    whether, as required by Section 337(c)(1)(E), a grant of a Section
    337 application would be in the public interest.[^28] The Commission
    also concluded that, pursuant to Section 337(c)(1)(A), Section 337
    relief should only be available if the applicant demonstrates that
    there is no available public safety spectrum in any band in the
    geographic area where the public safety use is proposed.[^29]

12. Finally, several petitions for reconsideration were filed with
    respect to the determinations in the *R&O*. American Automobile
    Association (AAA) requests clarification or reconsideration of the
    Commission's ruling that Section 309(j)(2)(A) exempts only certain
    blocks of spectrum, rather than types of spectrum users, from
    spectrum auctions.[^30] Similarly, several petitioners state that
    the Commission lacks the authority under Section 309(j) of the
    Communications Act to conclude that spectrum allocated for use by
    utilities is subject to competitive bidding.[^31] They also assert
    that the Communications Act prohibits the Commission from imposing
    auctions on auction exempt utilities indirectly via "band managers"
    licensed in the bands most commonly used by utilities. Central
    Station Alarm Association (CSAA) requests clarification of the
    Commission's definition of "private internal radio system" and of
    the term "public at large," contained in the standard used to
    determine whether a service is used to protect the safety of life,
    health or property.[^32] United Telecom Council (UTC) seeks
    reconsideration of the Commission's conclusion concerning the weight
    of its obligation to avoid mutual exclusivity, and seeks
    clarification with respect to future allocations for public safety
    radio services.[^33] AllCom, LLC (AllCom) requests reconsideration
    of the five-year holding period for those PLMR licensees that wish
    to transfer, assign or modify their authorization for use of PLMR
    channels in commercial operations.[^34] The Association of
    Public-Safety Communications Officials-International (APCO) seeks
    reconsideration of the Commission's interpretation and application
    of Section 337(c)(1)(A) and (E).[^35]

# DISCUSSION

## Obligation to Avoid Mutual Exclusivity

13. *Background.* The *R&O* established the regulatory framework for
    implementation of the Commission's revised auction authority under
    Section 309(j) of the Act.[^36] In the *R&O*, the Commission
    addressed whether the amendment of Section 309(j)(1) to incorporate
    an express reference to the Commission's obligation to consider
    alternatives to mutual exclusivity under Section 309(j)(6)(E)
    changes the scope or content of that obligation.[^37] The Commission
    analyzed the statute and the underlying legislative history and
    concluded that the added reference in Section 309(j)(1) to Section
    309(j)(6)(E) "serves to underscore the Commission's pre-existing
    obligation, but did not change its fundamental scope or
    content."[^38]

14. *Discussion*. UTC urges the Commission to reconsider this
    conclusion, and insists that the Commission "must continue to retain
    licensing regimes that avoid mutual exclusivity."[^39] However, the
    *R&O* made no blanket determination to eliminate licensing regimes
    that avoid mutual exclusivity. As UTC's petition acknowledges, the
    *R&O* did not change licensing procedures in existing services that
    preclude or limit the likelihood of mutually exclusive applications,
    and made no specific determination about what licensing procedures
    to adopt for future services.[^40] While the Commission pointed out
    that it remains within the Commission's authority to modify an
    existing licensing regime that avoids mutual exclusivity to permit
    the acceptance of mutual exclusive applications that are resolved by
    auctions, it also made clear that, should this issue arise in future
    service-specific rulemaking proceedings, as part of the Commission's
    public interest analysis we should give significant consideration to
    the effectiveness of licensing mechanisms that avoid mutual
    exclusivity, and weigh the potential costs of any such change
    against the potential benefits.[^41]

15. UTC also urges the Commission to give more weight to avoiding mutual
    exclusivity in establishing licensing procedures.[^42] In this
    regard, UTC's argument is similar to that made by the private radio
    service interests that previously contended that the added reference
    in Section 309(j)(1) to Section 309(j)(6)(E) requires the Commission
    to give greater weight to avoiding mutual exclusivity and less to
    other public interest objectives in determining which wireless
    services are potentially auctionable.[^43] The Commission expressly
    rejected this reading of the statute in the *R&O* and instead
    retained its long-standing interpretation of the scope of its
    statutory obligation to consider means to avoid mutual exclusivity
    under Section 309(j)(6)(E).[^44] The *R&O* observed that this
    interpretation was grounded in the Commission's statutory obligation
    to manage the spectrum in the public interest, noting:

> Section 309(j)(3)(D) requires the Commission to promote efficient use
> of the spectrum, which is a valuable and finite public resource. To
> accomplish these objectives, the Commission must have the freedom to
> consider all available spectrum management tools and the discretion to
> evaluate which licensing mechanism is most appropriate for the
> services being offered.[^45]

As we noted in the *R&O*, our conclusion was also buttressed by a recent
judicial interpretation of Section 309(j)(6)(E).[^46] UTC has provided
no new arguments or information to support a change in our conclusion
that the amendment of Section 309(j)(1) to add a cross-reference to
Section 309(j)(6)(E) serves to underscore the Commission's pre-existing
obligation, but does not change its fundamental scope or content.[^47]

## Band Manager Licensing

16. *Background*. In the *R&O*, the Commission concluded that, in
    addition to other licensing mechanisms, it should consider the use
    of band manager licensing as a future option for private services.
    The *R&O* also observed that the Commission had recently implemented
    the band manager concept for the first time in the 700 MHz Guard
    Bands, and found band manager licensing has the potential in other
    new spectrum allocations to provide private users with greater
    flexibility to access spectrum in amounts of bandwidth, periods of
    time, and geographic areas that best suit their needs.[^48]

17. *Discussion*. We do not agree with those petitioners that view band
    manager licensing primarily as a mechanism to subject private radio
    services to competitive bidding and a way to circumvent the
    statutory auction exemption for public safety radio services.[^49]
    In substantively identical petitions, a number of utilities argue
    that "it appears that the Commission intends to auction the right to
    be a Band Manager in the Prime Utility Bands \[the 470-512 MHz, 800
    MHz, and 900 MHz bands\]... ."[^50] In essence, these entities
    equate band manager licensing with the use of competitive bidding,
    which they oppose in the private services. The Commission rejected a
    similar argument in the *R&O* when many of these same petitioners
    equated the use of geographic area licensing with competitive
    bidding.[^51] The utilities' view incorrectly assumes that, if the
    Commission were to adopt band manager licensing for private radio
    services, it would also eliminate the eligibility restrictions for
    those bands and permit commercial entities to bid on spectrum
    reserved for private use.[^52] In fact, the *R&O* made no such
    determination. Instead, the *R&O* decision did "not adopt band
    manager licensing in any existing private radio service, nor \[did\]
    we make any specific decision to do so in any future service."[^53]
    In the *R&O*, the Commission observed that issues of whether
    particular kinds of rules, such as eligibility restrictions, should
    be adopted for a specific band will be addressed in future
    service-specific rulemakings.[^54] Furthermore, to the extent that
    petitioners believe that band manager licensing in a specific band
    would not be in the public interest, they will have an opportunity
    to comment on this issue in the service-specific rulemaking
    proceeding. For this reason, we find these objections are also
    premature.

18. The utilities contend that band manager licensing is an
    impermissible delegation of the Commission's licensing
    authority.[^55] These arguments were raised and addressed in the
    *R&O*[^56] and the parties make no new arguments here. Therefore, we
    do not address petitioners' arguments.

## Exemption from Competitive Bidding for Public Safety Radio Services

19. As noted earlier, the Balanced Budget Act, excludes public safety
    radio services from our authority to auction spectrum. In this
    regard, the Conference Report for Section 3002(a) of the Balanced
    Budget Act further illustrates Congress's intentions for public
    safety radio services and states that the exemption includes
    "private internal radio services" used by utilities, railroads,
    metropolitan transit systems, pipelines, private ambulances,
    volunteer fire departments, and not-for-profit organizations that
    offer emergency road services, such as AAA.[^57]

20. In the *R&O*, the Commission, *inter alia*, examined the scope of
    the public safety radio services exemption contained in the Act and
    explored mechanisms that may be used in the event that mutually
    exclusive applications for public safety radio services are filed.
    Specifically, the Commission concluded that the public safety radio
    services exemption applies to particular services, rather than
    individual users. In addition, the Commission determined that the
    public safety exemption from auctions was not limited to spectrum
    used by traditional public safety services, such as police, fire,
    and emergency medical services, but also included spectrum used by
    entities, such as utilities, railroads, transit systems, and others
    that provide essential services to the public at large and that need
    reliable communications in order to prevent or respond to disasters
    or crises affecting their service to the public.[^58] Furthermore,
    the Commission determined that where the majority of users licensed
    in an existing service and within a given frequency band are
    qualified to obtain auction exempt spectrum, future licensing for
    that service in that band will be exempt from auction.[^59]
    Conversely, the Commission also determined that where a majority of
    users within a given frequency band are not qualified to obtain
    auction exempt spectrum, that band should not be designated as
    auction exempt for that service, even if some individual licensees
    in the frequency band use the spectrum to protect the safety of
    life, health or property.[^60] In determining whether a user is
    qualified to obtain auction exempt spectrum, we examine the nature
    of the user, the type of service the user provides and the type of
    service offered in the subject frequency band.

21. We have before us twelve petitions seeking reconsideration and/or
    clarification of various aspects of the implementation of the public
    safety radio services exemption in the *R&O*.[^61] The petitioners
    request reconsideration and/or clarification of the following
    decisions: (1) applying the public safety radio services exemption
    to particular services rather than particular users; (2) examining
    the dominant use of a frequency band to determine whether the
    spectrum is exempt from auction; (3) defining "private internal
    radio service" as "a service in which the licensee does not make a
    profit, and all messages are transmitted between fixed operating
    positions located on premises controlled by the licensee and the
    associated fixed or mobile stations or other transmitting or
    receiving devices of the licensee, or between mobile stations or
    other transmitting or receiving devices"; and (4) requiring that the
    dominant use of spectrum that is not allocated for traditional
    public safety uses is by entities that "(a) have an infrastructure
    that they use primarily for the purpose of providing essential
    public services to the public at large; and (b) need, as part of
    their regular mission, reliable and available communications in
    order to prevent or respond to a disaster or crisis affecting the
    public at large" in order for the service to qualify for the
    exemption. Additionally, we will discuss several related issues on
    our own motion in an effort to clarify certain policies and rules.

### Exemption of Spectrum Blocks

22. *Background*. In the *R&O*, the Commission agreed with the majority
    of commenters that the public safety radio services exemption
    applies to radio services, rather than specific users.[^62] Because
    of its conclusion that the rules for a particular service determine
    whether the service falls within the public safety radio services
    definition, the Commission indicated that the exemption applies only
    to spectrum that the Commission specifically designates for the
    particular uses that Congress intended to benefit.[^63]

23. *Discussion*. Petitioners believe that the exemption should apply to
    specific users, and all private radio spectrum users that fall
    squarely within the congressional exemption are auction-exempt,
    regardless of the private radio spectrum band or bands they
    use.[^64] For instance, power utility companies Cinergy Corporation
    and Entergy Corporation argue that we lack authority under Section
    309(j) of the Communications Act to conclude that spectrum allocated
    for use by utilities (*i.e.*, 470-512, 800 and 900 MHz) is subject
    to competitive bidding because the plain language of Section 309(j)
    prohibits the use of competitive bidding in connection with public
    safety radio services, which includes services used by utilities to
    protect the safety of life or property.[^65]

24. While the approach identified by the petitioners might ensure that
    those specific users identified in the Conference Report would be
    able to secure spectrum without ever being subject to competitive
    bidding, we are not persuaded by petitioners' contentions and
    believe that the interpretation of Section 309(j)(2) set forth in
    the *R&O* is consistent with Congress's intentions with respect to
    the public safety radio services auction exemption. Section
    309(j)(2)(A) reads (in relevant part) "for public safety radio
    services, including private internal radio services used by State
    and local governments and non-government entities and including
    emergency road services provided by not-for-profit
    organizations."[^66] Congress specifically makes reference to
    "services" on the face of the statute and does not indicate that
    anything other than "services" are exempt from auction.
    Consequently, Section 309(j)(2)(A) does not mandate that we exempt
    specific radio "users" or "licensees."[^67]

25. Although the legislative history of the Balanced Budget Act refers
    to particular "users" as being exempt, the Commission has held that
    this language is best interpreted as illustrating the types of
    services that fall within the new statutory exemption.[^68] The
    plain language of the statute references "services."[^69]
    Reconciling the statute with the legislative history in this fashion
    not only properly gives greater weight to the statute itself, but
    also provides for truly workable implementation of its intent. If,
    by way of alternative interpretation, each user of the type of
    services mentioned in the legislative history were considered
    statutorily exempt from the competitive bidding process, these
    entities would be afforded carte blanche to disrupt any competitive
    bidding process with respect to non-exempt services.[^70]

26. Furthermore, the interpretation in the *R&O* is consistent with our
    spectrum allocation and management policies. As one of the
    petitioners observes, in interpreting public safety radio services,
    the Commission interpreted the term "service" in Section 309(j)(2)
    as it is used in our Rules (*i.e.*, to denote a radio service
    consisting of a combination of operating and eligibility rules and
    associated spectrum).[^71] We believe that Congress recognized that
    many of our current services are "mixed use," containing both
    entities that use spectrum to protect the safety of life, health, or
    property, and others that do not protect the safety of life, health,
    or property. If, by way of alternative interpretation, each user of
    the type of services mentioned in the legislative history were
    considered statutorily exempt from the competitive bidding process,
    utility companies, for example, would gain an advantage that seems
    inconsistent with and certainly not required by the statutory
    language. Under this alternative interpretation, utility companies
    would be able to obtain a license to provide traditional CMRS
    offerings without participating in the competitive bidding process,
    while other CMRS operators would have to pay for such a license
    after participating in (and winning in) the competitive bidding
    process. Further, we believe that Congress did not intend for the
    exemption to apply to spectrum that is predominantly used by
    entities that do not use it to protect the safety of life, health or
    property. Thus, we conclude that the *R&O's* interpretation of the
    public safety radio services exemption is an accurate analysis of
    the statute, consistent with Congress's objectives.

27. This analysis is not changed by *National Public Radio, Inc. v.
    FCC*,[^72] which was decided after the petitions for reconsideration
    of the *R&O* were filed. In that case, noncommercial educational
    broadcasters (NCEs) challenged the Commission's policy of not
    exempting NCEs from participating in auctions when they apply for
    spectrum outside of that specifically designated for NCE use.[^73]
    The D.C. Circuit held that the exemption from competitive bidding
    for NCEs, 47 U.S.C. § 309(j)(2)(C), exempts NCEs from participating
    in auctions for any broadcasting spectrum, whether or not the
    spectrum has been reserved for noncommercial educational use.[^74]
    Because Section 309(j)(2)(C) specifically exempts NCE "stations,"
    the court concluded that the NCE exemption "is based on the nature
    of the station that ultimately receives the license, not on the part
    of the spectrum in which the station operates."[^75] In contrast,
    the exemption in Section 309(j)(2)(A) does not "refer\[\] to the
    ultimate recipient of the license."[^76] Instead, as noted above, it
    specifically refers to "public safety radio services" used by public
    safety entities, not public safety stations or licensees themselves.
    Thus, we believe that the *NPR* court's "plain language" analysis
    supports the Commission's interpretation of Section 309(j)(2)(A) set
    forth in the *R&O*.

28. Moreover, the approach taken in the *R&O* is practical because it
    allows the Commission to manage spectrum efficiently in a manner
    consistent with its obligations under the Communications Act.[^77]
    Section 309(j)(3) directs the Commission to promote specified public
    interest objectives in determining which classes of licenses and
    permits should be assigned by competitive bidding, which necessarily
    requires the Commission to consider in each case whether to adopt a
    licensing mechanism that allows for mutual exclusivity.[^78] Once it
    has decided to use competitive bidding to assign licenses for a
    particular band and service, permitting public safety entities to
    override the designation of spectrum as auctionable would undermine
    the Commission's expanded auction authority.[^79] As the Commission
    has previously recognized, a license assignment scheme that would
    permit any entity seeking to use spectrum for public safety purposes
    to prevail against all other mutually exclusive applicants in
    securing spectrum designated for auction "would, in effect, give
    \[such entities\] a 'right of refusal' over any spectrum made
    available by the Commission" under its competitive bidding
    processes.[^80] Because such an approach would make spectrum freely
    available to public safety radio service eligibles on demand, the
    Commission and other potential applicants would not know in advance
    which licenses would be available at auction.[^81] This uncertainty
    would give rise to delays in the deployment of new spectrum-based
    services and would frustrate the statutory objectives of competitive
    bidding, as expressed in the Communications Act.[^82]

29. Further, we believe that petitioners' proposed approach would also
    undermine the Commission's duty under Section 303(y)(2) to allocate
    spectrum so as to provide flexibility of use -- that is, to expand
    the range of permissible uses within a particular service --
    provided certain conditions are met.[^83] One way to avoid the
    administrative inefficiencies that would result from the
    petitioners' proposed approach would be to forbid entities eligible
    to be licensed on public safety radio services from voluntarily
    participating in auctions for spectrum that is not exempted from our
    competitive bidding authority. The Commission has, however, rejected
    this alternative, having found that such an approach was not
    consistent with Congress's intent.[^84] Instead, consistent with our
    obligations under Sections 303(y) and 309(j)(3),[^85] the *R&O* made
    clear that we will continue to permit public safety entities to
    participate voluntarily in auctions for spectrum that is not
    exempted from our competitive bidding authority.[^86] For these
    reasons, we believe that the Commission's interpretation of Section
    309(j)(2)'s public safety radio services exemption in the *R&O* is
    proper and consistent with congressional intent. Thus, we find no
    basis for reconsidering the interpretation in the *R&O*.

### Private Internal Radio Service

30. *Background*. In the *R&O*, the Commission defined the "private
    internal radio service" element of the statutory exemption as "a
    service in which the licensee does not make a profit, and all
    messages are transmitted between fixed operating positions located
    on premises controlled by the licensee and the associated fixed or
    mobile stations or other transmitting or receiving devices of the
    licensee, or between mobile stations or other transmitting or
    receiving devices of the licensee."[^87]

31. *Discussion*. CSAA, which represents entities that provide central
    station alarm security protection services, requests clarification
    of the Commission's definition of "private internal radio
    service."[^88] In this connection, CSAA suggests that the Commission
    slightly modify its definition of "private internal radio service"
    by removing the reference to "of the licensee."[^89] Hence,
    according to CSAA, the definition should read "a service in which
    the licensee does not make a profit, and all the messages are
    transmitted between fixed operating positions located on premises
    controlled by the licensee and the associated fixed or mobile
    stations or other transmitting or receiving devices, or between
    mobile stations or other transmitting or receiving devices."[^90]
    Based on its suggested modification, it appears that petitioner is
    concerned about the definition's requirement that "the associated
    fixed or mobile stations or other transmitting or receiving devices"
    be "of the licensee" because end units in alarm systems are often
    purchased by the subscriber and found in the subscriber's home.[^91]
    CSAA states that the radios located on customer premises can be
    remotely controlled from the alarm company central station.[^92]
    CSAA adds that the channels designated by the Commission for the
    exclusive use of central station alarm companies are used to provide
    "private internal radio services" despite the fact that alarm
    company remote transmitters may be located on a customer's
    premises.[^93]

32. We do not believe that the suggested change to the "private internal
    services" definition is necessary. The Commission has determined in
    another context (the Multiple Address Systems (MAS) Service with
    respect to security alarm monitoring services) that the associated
    devices to which CSAA makes reference may be part of an internal
    system.[^94] Moreover, the Commission stated that the principles
    underlying the definitions of "private internal" in the MAS rules
    and in the *R&O* in this proceeding are the same, and that a service
    which is private internal for MAS purposes is also private internal
    for purposes of applying the auction exemption for public safety
    radio services.[^95] Therefore, we will retain the current "private
    internal radio system" definition as set forth in the *R&O*. Our
    decision in this regard is in the public interest, as it will enable
    us to effectively accommodate central station alarm companies while
    fostering consistency among pertinent wireless communications
    service rules.

### Dominant Use Analysis

33. *Background.* Because the exemption applies to radio services,
    rather than individual users or specific users, the Commission
    addressed the question of what proportion of the users of a given
    band must be of the type that Congress intended to have access to
    auction-exempt spectrum, in order for the service to be deemed a
    public safety radio service.[^96] In this connection, the Commission
    concluded that an analysis of whether the majority of users within a
    particular, existing band are qualified to obtain auction-exempt
    spectrum will be conducted, in order to determine whether that
    service should be designated as auction-exempt.[^97] Hence, the
    "dominant" or "primary" use of each band will be examined.[^98]

34. *Discussion*. Petitioners contend that the "dominant use" test is
    contrary to the clear intent of Congress in implementing the
    exemption for public safety radio services.[^99] They argue that the
    Commission's interpretation of the statute is based on an
    impermissible reading and that its construction of the section is
    unreasonable and thus impermissible under the *Chevron*[^100]
    analysis.[^101] Petitioners also state that the Commission failed to
    explain the basis for the dominant use test, thus the application of
    the test violates part of the *Chevron* analysis.[^102]

35. With respect to the statutory interpretation, the petitioners argue
    that we lack authority under Section 309(j) of the Communications
    Act to conclude that spectrum in which utilities are among those
    eligible to hold licenses (*e.g.*, 470-512, 800 and 900 MHz) is
    subject to competitive bidding because the plain language of Section
    309(j) prohibits the use of competitive bidding in connection with
    public safety radio services, which includes services used by
    utilities.[^103] Moreover, the petitioners assert that the statute
    plainly states that "services . . . that are used to protect the
    safety of life, health and property" are exempt.[^104] Thus,
    according to the petitioners, the Commission departed from the
    statute's plain meaning by interpreting the statute to mean services
    that are predominantly used to protect the safety of life, health
    and property are exempt from auction.[^105]

36. We conclude that the "dominant use" analysis is lawful, as it is
    consistent with Congress's intent for the public safety radio
    services auction exemption. Petitioners essentially argue that
    Congress intended to exempt from auction any spectrum that is used
    anywhere in the country by any licensee for a use that protects the
    safety of life, health, or property. As set forth in the preceding
    discussion and as indicated by petitioners herein, Congress clearly
    stated that exemption to auction would apply to public safety radio
    "services," not "users" or "licensees."[^106] In addition,
    Congress's purpose in revising our auction authority in Section
    309(j)(1) was to expand the universe of auctionable spectrum beyond
    subscriber-based services, and thereby reduce the scope of
    auction-exempt uses.[^107] As the Commission explained in the *R&O*,
    "\[t\]o interpret the exemption for public safety radio services in
    Section 309(j)(2)(A) in a manner that effectively negates the
    changes to Section 309(j)(1) would not be reasonable."[^108] Given
    the "mixed use" of the bands discussed by the petitioners, their
    proposed interpretation of Section 309(j)(2) would actually include
    more users within the scope of the exemption because it considers
    both private internal radio services as well as non-private internal
    radio services. Moreover, nothing in the statute or legislative
    history indicates that Congress intended for significant numbers of
    licensees in "mixed use" bands that do not use spectrum to protect
    the safety of life, health, or property to have access to
    auction-exempt spectrum.[^109] Accordingly, we believe that
    implementation of the "dominant use" standard is proper.

37. The Commission previously stated that Section 309(j)(6)(E) provides
    the Commission with the discretion to take into account the dominant
    use of the spectrum, administrative efficiency and other related
    licensing issues.[^110] In the *R&O*'s discussion of the dominant
    use analysis, the Commission posed a threshold question concerning
    the proportion of users in a given band that must be the type of
    user that Congress intended to be able to make use of exempt
    spectrum, in order for the service to be deemed a public safety
    radio service.[^111] In exploring the available options, it examined
    the issue of characterizing varied operations located in "mixed use"
    bands in the context of other proceedings. In this connection, it
    concluded that precedent for examining the dominant or primary use
    of the band exists and that this approach promotes Congressional
    intent.[^112] Thus, in an existing service in a particular frequency
    band where spectrum is used by some incumbents to protect the safety
    of life, health, or property, and by others for non-public safety
    purposes, the "dominant use" test is a more practical approach than
    an "any use" test to managing the future licensing of that service
    in that band. Again, we emphasize that we cannot efficiently and
    effectively manage spectrum by exempting the specific users
    identified in the statutory language.[^113] In addition to being
    administratively burdensome on the Commission, this methodology
    would directly contravene the revised language in Section 309(j) of
    the Act.

38. Finally, we take this opportunity to clarify that as a practical
    matter, the "dominant use" analysis will be helpful in assessing the
    auctionability of only previously licensed bands for which no
    substantially new or different use is being proposed. As noted
    above, this issue arises only in instances where spectrum is
    currently used by many licensed entities to protect the safety of
    life, health, or property, and by others for non-public safety
    purposes. For instance, in the Multiple Address System (MAS)
    proceeding, the dominant use of each band was examined to determine
    whether to assign future MAS service licenses by competitive
    bidding.[^114] With respect to spectrum to be used for new services,
    we intend to adopt service rules that will specifically determine
    whether the service qualifies as a public safety radio service and
    is therefore exempt from competitive bidding. That is, when we
    designate spectrum as a public safety radio service, we intend to
    limit the permitted uses to those that Congress intended for
    auction-exempt spectrum (or some subset thereof).[^115]

### Protection of Life, Health, or Property

39. *Background*. As stated earlier, the public safety radio services
    exemption applies to private internal services used by state and
    local governments and non-government entities to protect the safety
    of life, health, or property.[^116] In the *R&O*, the Commission
    determined that Congress intended for the exemption to include a
    larger universe of services than traditional public safety services
    and that the services the dominant use of which is by the entities
    of the type identified in the Conference Report (*i.e.*, utilities,
    railroads, metropolitan transit systems, pipelines, private
    ambulances, and volunteer fire departments) were to be included
    within the exemption as well.[^117] Hence, the Commission concluded
    that a radio service not allocated for traditional public safety
    uses will be deemed to be used to protect the safety of life, health
    or property within the meaning of Section 309(j)(2)(A)(i) if the
    dominant use of the service is by entities that (1) have an
    infrastructure that they use primarily for the purpose of providing
    essential public services to the public at large; and (2) need, as
    part of their regular mission, reliable and available communications
    in order to prevent or respond to a disaster or crisis affecting the
    public at large.[^118]

40. *Discussion*. In its petition, CSAA seeks clarification as to our
    intent with respect to the term "public at large."[^119]
    Specifically, the petitioner requests that we confirm that the
    service provided need only be *available for use* by the public at
    large, rather than in actual use.[^120] CSAA also wishes to clarify
    the criterion that reliable and available communications are needed
    to respond to a disaster or crisis affecting the public at large,
    and adds that alarm companies use radios to signal the occurrence of
    events that by definition are life-threatening (*i.e*., fire,
    burglary, medical emergencies).[^121]

41. We do not agree with CSAA's approach to examining the "protection of
    life, health, or property" standard. CSAA suggests that alarm
    monitoring companies should be deemed to serve the public at large
    because they make their services available to any member of the
    public who wishes to subscribe.[^122] This interpretation is
    overbroad and, indeed, would apply to just about any entity that is
    open for business. Rather, as used in the *R&O*, the term "public at
    large" refers to the recipients of "essential public services"
    referenced therein. When the Commission stated that the entity must
    have an infrastructure it uses primarily for the purpose of
    providing essential public services to the public at large, it
    intended for the entity to provide essential public services to a
    large portion of the population, as do utilities. As stated in the
    *R&O*, one of the characteristics of a service that protects the
    safety of life, health, or property is that the public at large
    depends on this service, which affects their daily lives and where
    accidents or service interruptions may have dangerous consequences
    to a significant number of people.[^123] We recognize that alarm
    companies provide important functions to its subscribers for which
    reliable and available communications are needed to facilitate the
    prevention of some potentially life-threatening hazards.
    Nonetheless, we do not believe that alarm and/or alarm monitoring
    services concern a large part of the population to the extent that
    the wider community would be detrimentally affected by a disruption
    in the service. Furthermore, our approach to determining whether a
    particular use protects the safety of life, health or property
    ensures that only those services that Congress clearly intended to
    exempt from auction are exempt, and is consistent with Congress's
    amendment to Section 309(j)(1) to expand the definition of
    auctionable services.

### General Clarification

42. UTC generally commends the *R&O*.[^124] While it recognizes the
    "general framework" provided for exercising the expanded auction
    authority with regard to private wireless services, UTC seeks
    general clarification with respect to the following issues: (1)
    whether there will be future allocations for public safety radio
    services; (2) if so, whether such allocations will be available for
    all users of public safety radio services; (3) in what, if any, way
    will utilities, pipelines, metropolitan transit systems and
    railroads have access to existing allocations of public safety radio
    service spectrum; and (4) whether the Commission will limit the
    impact upon public safety radio service eligibles that might result
    from any licensing changes in existing or future allocations.[^125]
    According to UTC, existing spectrum allocations are increasingly
    congested and subject to interference, and therefore must be
    preserved for public safety radio services, particularly utilities,
    pipelines and railroads.[^126] Moreover, UTC adds that sources of
    spectrum must be supplied for public safety radio services
    immediately.[^127]

43. We understand UTC's concern about adequate spectrum availability for
    all of the services that fall within the scope of the public safety
    radio services exemption. We also realize that Congress has
    recognized that the public safety radio services have special
    spectral needs as they have been specifically identified for
    exemption from spectrum auctions. In this connection, we are working
    earnestly to balance the interests of various uses to meet spectral
    demands through spectrum allocation plans and our service rules. We
    should note that with respect to existing spectrum, we have made
    accommodations for public safety radio services as intended by
    Congress. For instance, in the MAS Service, the public safety radio
    services have access to 2.4 MHz of auction-exempt spectrum in the
    900 MHz bands. With the streamlining of the service rules and the
    relaxation of the technical and operational rules, the service is a
    viable alternative for more varied uses. In addition, we have
    recently identified newly allocated spectrum in the 27 MHz
    proceeding that may be available for flexible use, including private
    wireless services.[^128] We should note that the decisions in the
    *R&O* have not yet affected any current licensees of public safety
    radio services, because currently their services are for the most
    part licensed in manners that do not give rise to mutually exclusive
    applications,[^129] which is a prerequisite for our use of
    competitive bidding.[^130]

44. With respect to future spectrum allocations, we will continue to
    accommodate the spectrum needs of the public safety radio services
    where feasible. As indicated in the *R&O*, we will designate
    spectrum for public safety radio services as we specifically
    identify and allocate available spectrum for private radio
    services.[^131] A separate designation may be created for public
    safety radio services and/or traditional public safety radio
    services as defined by Part 90, either by allocation or service
    rules (including eligibility requirements). We decline to speculate
    in this proceeding as to the amount of spectrum that will be made
    available for public safety radio services in the future, and will
    instead reserve that determination to specific proceedings.
    Therefore, we will continue to evaluate and consider the spectrum
    needs of all public safety radio services in future proceedings.

45. Additionally, on our own motion, we will take this opportunity to
    modify Section 1.227 of our Rules to conform it with the Balanced
    Budget Act and the *R&O*. Section 1.227(b)(4) discusses resolving
    mutually exclusive applications received by the Commission for
    Private Wireless Services.[^132] Specifically, the provision
    currently states that such cases will be consolidated for hearing or
    designated for random selection.[^133] The Commission no longer
    utilizes random selection processes to resolve such conflicts and
    has indicated that it will rely on existing regulatory tools to
    resolve rare instances of mutually exclusive applications in
    services that are exempt from competitive bidding.[^134]
    Accordingly, we will modify our rules in this regard.

## Licensing of PLMR Channels in the 800 MHz Band for Commercial SMR Systems

46. *Background.* In the *R&O*, the Commission concluded that 800 MHz
    Business and I/LT licensees should be allowed to modify their
    licenses to permit commercial use, or to assign or transfer their
    licenses to commercial operators, subject to certain
    safeguards.[^135] The Commission noted that it did not want to
    facilitate trafficking of PLMR spectrum, *i.e.*, PLMR eligibles
    acquiring new licenses from the existing pool of unassigned
    frequencies for the purpose of selling them to commercial
    providers.[^136] In that connection, it amended our rules to permit
    modification to commercial use or assignment to a commercial
    operator only in the case of PLMR licenses that were initially
    granted at least five years prior to the modification, transfer, or
    assignment.[^137] However, it decided not to apply this five-year
    holding period to licenses already granted, or for which the
    application already was filed, as of the adoption date of the *R&O
    and FNPRM* because prior to then, no speculative incentive to
    acquire Business and I/LT frequencies can be inferred.[^138]

47. *Discussion.* AllCom filed a petition requesting that the five-year
    holding period be reconsidered and deleted.[^139] AllCom argues that
    the five-year holding period is unnecessary because the rules
    already prohibit the assignment of unconstructed 800 MHz frequency
    assignments, which creates a *de facto* holding period.[^140]
    Additionally, it argues that the holding period may prevent
    non-speculative transactions and is therefore contrary to the public
    interest.[^141] AllCom also suggests that imposing a holding period
    is contrary to the Commission's decision allocating 220-222 MHz band
    spectrum without eligibility restrictions.[^142] Alternatively,
    AllCom asks that the holding period be reduced to one year, or that
    the Commission indicate that it will favorably review waiver
    requests of the holding period where the parties can demonstrate
    that there is no trafficking involved.[^143] The Personal
    Communications Industry Association (PCIA) filed an Opposition to
    AllCom's Petition stating that it supports anti-trafficking measures
    and opines that the elimination of the restrictions would result in
    the wholesale reallocation of the 800 MHz Business and I/LT
    categories to SMR entities.[^144]

48. AllCom has not persuaded us that the five-year holding period is
    unnecessary or excessive. Consequently, we affirm the determinations
    in the *R&O* and maintain the five-year holding period for those
    licensees where the applications were filed after the adoption of
    the *R&O and FNPRM*, or where the spectrum assignment or service
    area was increased after that date. We continue to believe that a
    five-year holding period is appropriate because such a requirement
    has been applied to other situations where speculation and
    trafficking were concerns. For example, our rules provide that
    licensees are subject to unjust enrichment payments for any license
    transfer that occurs within five years of the license grant.[^145]
    Also, we note that 800 MHz PLMR licensees can receive an extended
    implementation period for of up to five years, if they demonstrate
    that such a period is required to construct the proposed wide-area
    system.[^146] One of our goals in requiring a holding period is to
    ensure that these channels will continue to be initially licensed
    only to entities that will use them for PLMR communications. As
    noted in the *R&O*, a holding period of less than five years could
    undermine this goal by allowing many wide-area licensees to modify
    or transfer their licenses for commercial use upon
    construction.[^147] AllCom has not demonstrated that the balance
    struck in the *R&O* between flexibility and conditions, including
    the five year holding period, should be reconsidered at this
    time.[^148]

49. We take this opportunity to address other issues related to
    licensing of PLMR channels in the 800 MHz band for use in commercial
    systems. When the Commission adopted rules permitting modification,
    assignment, or transfer of PLMR licenses for commercial use, it
    provided that such applications were to be filed and processed in
    accordance with the rules and procedures governing other
    applications for Business and I/LT channels.[^149] Our experience
    has demonstrated that it would be administratively easier for
    applicants and Commission staff if these applications were filed and
    processed in accordance with our rules and procedures for commercial
    stations, instead. We will amend the rule accordingly. Additionally,
    we will amend the rule to clarify that a licensee that has modified
    its authorization for use in a commercial operation, or a commercial
    operator that acquired PLMR channels via assignment or transfer, may
    at any time submit a modification application to indicate that the
    subject frequencies will be used in a PLMR system, provided that the
    licensee meets the applicable eligibility requirements.

50. Finally, we note that Section 90.621(e)(2), as amended in the *R&O*,
    authorizes modification and assignment of PLMR licenses "for
    commercial operation." The text of the *R&O*, however, spoke in
    terms of "CMRS use."[^150] We take this opportunity to clarify that
    the rule authorizes modification or assignment of PLMR licenses for
    any SMR use, whether that use is classified as Commercial Mobile
    Radio Service ("CMRS") or PMRS.[^151] Consistent with this
    determination, the requirement that any such application must
    include a certification that written notice of the modification
    application has been provided to certain public safety
    licensees,[^152] therefore, is also applicable to all modification
    and assignment applications pursuant to Section 90.621(e)(2),
    whether the intended SMR commercial operation is classified as CMRS
    or PMRS.

## Section 337 Licensing for Public Safety Services

51. *Background.* The Balanced Budget Act added a new Section 337 to the
    Communications Act. Section 337 of the Communications Act, *inter
    alia*, provides certain public safety entities the opportunity to
    apply for unused spectrum not otherwise allocated for public safety
    use. The terms and conditions under which an eligible entity may
    apply to the Commission for spectrum under Section 337 are provided
    at subsection (c)(1) of Section 337 as follows:

\(c\) Licensing of Unused Frequencies for Public Safety Services.\--

> \(1\) Use of unused channels for public safety services.\--Upon
> application by an entity seeking to provide public safety services,
> the Commission shall waive any requirement of this Act or its
> regulations implementing this Act (other than its regulations
> regarding harmful interference) to the extent necessary to permit the
> use of unassigned frequencies for the provision of public safety
> services by such entity. An application shall be granted under this
> subsection if the Commission finds that\--
>
> \(A\) no other spectrum allocated to public safety services is
> immediately available to satisfy the requested public safety service
> use;
>
> \(B\) the requested use is technically feasible without causing
> harmful interference to other spectrum users entitled to protection
> from such interference under the Commission's regulations;
>
> \(C\) the use of the unassigned frequency for the provision of public
> safety services is consistent with other allocations for the provision
> of such services in the geographic area for which the application is
> made;
>
> \(D\) the unassigned frequency was allocated for its present use not
> less than 2 years prior to the date on which the application is
> granted; and

\(E\) granting such application is consistent with the public
interest.[^153]

52. In the *R&O*, the Commission concluded that Section 337(c)(1)(A)
    requires that the applicant demonstrates that there is no available
    public safety spectrum in any band in the geographic area where the
    public safety use is proposed.[^154] The Commission also concluded
    that the state of the competitive bidding process when the Section
    337 application is received is relevant to our determination of
    whether grant of the waiver request and the associated
    application(s) is in the public interest, as required by subsection
    (c)(1)(E).[^155] In particular, the Commission stated that it will
    balance a variety of factors, such as the likelihood that the
    spectrum will be auctioned, the likely timetable for such an
    auction, and the effect that grant of the request may have on such a
    future auction, against the stated needs of the applicant and our
    obligation to promote public safety.[^156] Moreover, the Commission
    decided that once the mechanisms for a particular spectrum auction
    are in place, beginning with the issuance of a public notice
    announcing the date of the auction, the competitive bidding process
    is substantially underway, and only in highly extraordinary
    circumstances would grant of a Section 337 request be in the public
    interest.[^157]

53. *Discussion*. First, APCO requests reconsideration of the
    determination that an applicant must demonstrate that there is no
    available public safety spectrum in any band in the geographic area
    where the public safety use is proposed.[^158] APCO argues that a
    portion of Section 337(c)(1)(A) \-- "to satisfy the requested public
    safety service use" \-- is being ignored and not given statutory
    effect.[^159] APCO also claims that the Commission's interpretation
    ignores the difference in public safety bands, *i.e.* equipment,
    propagation characteristics, number of stations needed to cover an
    area.[^160] APCO asserts that the Commission's interpretation will
    undermine interoperability among public safety users because
    incompatible spectrum would be required to be used instead of
    spectrum from the desired band.[^161] APCO argues that spectrum
    other than the desired spectrum is simply not a reasonable
    alternative and is therefore not immediately available.[^162]

54. None of APCO's arguments persuade us to reconsider the conclusion in
    the *R&O* that the language and legislative history of Section
    337(c)(1)(A) clearly require that no other spectrum allocated to
    public safety services be available without any qualification. As
    the Association of American Railroads (AAR) points out, Congress did
    not include any considerations for cost or technical feasibility in
    the legislative history or the actual statute,[^163] and the
    Conference Report's use of the words "spectrum" and "frequency" is
    not qualified, modified or conditioned in any way.[^164] The
    Conference Report states, "Spectrum must not be immediately
    available on a frequency already allocated to public safety
    services."[^165] We concur with the Wireless Telecommunications
    Bureau's assessment, in several matters, that the lack of spectrum
    in a particular desired band or bands does not satisfy the statutory
    requirements.[^166] With respect to APCO's assertion that effect
    must be given, if possible, to every word, clause and sentence of a
    statute,[^167] we agree. We believe, however, that the legislative
    language "to satisfy the requested public safety use" is properly
    interpreted to reference the types of use set forth in the table of
    allocations such as allocations for fixed or mobile use, rather than
    some specific frequency band deem desirable by the applicant.
    Therefore, we decline to adopt APCO's statutory interpretation of
    Section 337(c)(1)(A).

55. APCO also requests reconsideration of the stricter standard applied
    to Section 337 applications received after the announcing public
    notice is released.[^168] APCO asserts that any time-sensitive
    periods would have been identified in the statute or in the
    legislative history as it was with Section 337(c)(1)(D).[^169] APCO
    argues that the Commission's interpretation is inconsistent with the
    clear language of the statute and Congressional intent.[^170]

56. We affirm the decision to consider the state of the competitive
    bidding process when the Section 337 application is received as
    relevant to our determination of whether grant of the waiver request
    and the associated application(s) is in the public interest, as
    required by subsection (c)(1)(E). As the Commission noted in the
    *R&O*, the later in the proceedings a Section 337 application is
    filed, the greater the impact on the Commission's competitive
    bidding process and on prospective bidders' plans.[^171] We also
    affirm the decision to make these determinations on a case-by-case
    basis.

57. Additionally, we note that the Commission required that Section 337
    applicants file in the same manner and on the same form(s) as
    ordinary applicants for the subject spectrum.[^172] In order to
    further facilitate the processing of Section 337 applications, we
    now modify the rule to require applicants to enter the service code
    applicable to the type of service they intend to provide.[^173]

    **IV. CONCLUSION**

58. In this *MO&O*, we adhere to the conclusion that the amendments to
    Section 309(j) do not preclude the Commission from using licensing
    mechanisms for private services that result in the filing of
    mutually exclusive applications if it is in the public interest to
    do so. Additionally, we affirm the determination in the *R&O* that
    the public service radio services exemption in 309(j) applies to
    services rather than users. We believe that this analysis of the
    statute reflects the plain language of the statute as well as
    congressional intent. Moreover, we affirm the dominant use test set
    forth in the *R&O* as the means to determine whether the particular
    service qualifies for the public safety radio services exemption. We
    also retain the five-year holding period as a requirement for
    modification of an 800 MHz PLMRS authorization to permit commercial
    use. Finally, with respect to implementation of Section 337 of the
    Act, we affirm the decisions in the *R&O* that an applicant must
    demonstrate that there is no public safety spectrum available before
    it can be granted a waiver pursuant to Section 337, and that the
    stage of the competitive bidding process is one of many factors that
    will be evaluated on a case-by-case basis to determine satisfaction
    of the public interest criterion. We believe that the conclusions
    drawn herein reflect congressional intent and will result in
    appropriate implementation of Section 309(j) and 337 of the
    Communications Act of 1934, as amended. Further, these conclusions
    will advance effective and efficient spectrum management.

    **V. PROCEDURAL MATTERS**

    **A. Final Regulatory Flexibility Act Analysis**

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

    **B. Paperwork Reduction Act of 1995 Analysis**

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

    **C. Further Information**

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

    **VI. ORDERING CLAUSES**

62. Accordingly, pursuant to Sections 1, 2, 4(i), 5(c), 7(a), 11(b),
    301, 302, 303, 307, 308, 309(j) , 310, 312a, 316, 319, 323, 324,
    332, 333, 336, 337, and 351 of the Communications Act of 1934, as
    amended, 47 U.S.C. §§ 151, 152, 154(i), 155(c), 157(a), 161(b), 301,
    302, 303, 307, 308, 309(j), 310, 312a, 316, 319, 323, 324, 332, 333,
    336, 337, and 351, the Balanced Budget Act of 1997, Pub. L. No.
    105-33, Title III, 111 Stat. 251 (1997), and Sections 1.421 and
    1.425 of the Commission's Rules, 47 C.F.R. §§ 1.421 and 1.425, IT IS
    ORDERED that the *Memorandum Opinion and Order* is hereby ADOPTED.

63. IT IS FURTHER ORDERED that Parts 1 and 90 of the Commission's Rules
    ARE AMENDED as set forth in Appendix B, and that these Rules shall
    be effective **\[60 days after publication in the Federal
    Register\]**.

64. IT IS FURTHER ORDERED that the Petitions for Reconsideration
    submitted by the following parties are DENIED: AllCom, LLC; American
    Automobile Association; Association of Public-Safety Communications
    Officials-International; Central Station Alarm Association; Cinergy
    Corporation; Commonwealth Edison Company; Consolidated Edison
    Company of New York; Entergy Corporation; Kansas City Power & Light
    Company; Omaha Public Power District; SCANA; Union Electric Company
    and Central Illinois Public Service Company and Ameren Energy
    Generating Company; United Telecom Council; and Xcel Energy, Inc.

65. IT IS FURTHER ORDERED that the Commission's Consumer Information
    Bureau, Reference Information Center, SHALL SEND a copy of this
    *Memorandum Opinion and Order*, including the Supplemental
    Regulatory Flexibility Analysis and Final Regulatory Flexibility
    Analysis, to the Chief Counsel for Advocacy of the U.S. Small
    Business Administration.

66. IT IS FURTHER ORDERED that the Motion to Accept Supplemental
    Comments submitted by Industrial Telecommunications Association,
    Inc. is GRANTED.

    FEDERAL COMMUNICATIONS COMMISSION

    Marlene H. Dortch Secretary

    **APPENDIX A**

    **Pleadings Filed in WT Docket 99-87**

**Petitions for Reconsideration**

AllCom, LLC (AllCom)

American Automobile Association (AAA)

Association of Public-Safety Communications Officials-International
(APCO)

Central Station Alarm Association (CSAA)

Cinergy Corporation (Cinergy)

Commonwealth Edison Company (Commonwealth Edison)

Consolidated Edison Company of New York (Consolidated Edison)

Entergy Corporation (Entergy)

Kansas City Power & Light Company (KCPL)

Omaha Public Power District (Omaha)

SCANA Corporation (SCANA)

Union Electric Company and Central Illinois Public Service Company and
Ameren Energy Generating Company (Union Electric)

United Telecom Council (UTC)

Xcel Energy, Inc.

**Oppositions to Petitions for Reconsideration**

Association of American Railroads (AAR)

Personal Communications Industry Association, Inc. (PCIA)

**Replies to Oppositions to Petitions for Reconsideration**

APCO

AllCom

**APPENDIX B**

# FINAL RULES {#final-rules .unnumbered}

Parts 1 and 90 of Title 47 of the Code of Federal Regulations are
amended as follows:

PART 1 -- PRACTICE AND PROCEDURE

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

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

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

**§ 1.913 Application forms; electronic filing and manual filing.**

\* \* \* \* \*

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

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

**§ 1.227 Consolidations.**

\* \* \* \* \*

\(b\) \* \* \* \* \*

\(3\) \* \* \* \* \*

\(ii\) *Domestic public fixed and public mobile*. See Rule § 21.31 for
the requirements as to mutually exclusive applications. See also Rule §
21.23 for the requirements as to amendments of applications.

\* \* \* \* \*

\(4\) This paragraph applies when mutually exclusive applications
subject to section 309(b) of the Communications Act and not subject to
competitive bidding procedures pursuant to § 1.2102 of this chapter are
filed in the Private Radio Services, or when there are more such
applications for initial licenses than can be accommodated on available
frequencies. Except for applications filed under part 101, subparts H
and O, Private Operational Fixed Microwave Service, mutual exclusivity
will occur if the later application or applications are received by the
Commission's offices in Gettysburg, PA (or Pittsburgh, PA for
applications requiring the fees set forth at part 1, subpart G of the
rules) in a condition acceptable for filing within 30 days after the
release date of public notice listing the first prior filed application
(with which subsequent applications are in conflict) as having been
accepted for filing or within such other period as specified by the
Commission. For applications in the Private Operational Fixed Microwave
Service, mutual exclusivity will occur if two or more acceptable
applications that are in conflict are filed on the same day.

\* \* \* \* \* \*

> PART 90 -- PRIVATE LAND MOBILE RADIO SERVICES

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

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

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

**§ 90.621 Selection and assignment of frequencies.**

\* \* \* \* \*

\(e\) \* \* \* \* \*

\(2\) Notwithstanding paragraph (e)(5) of this section, licensees of
channels in the Industrial/Land Transportation and Business categories
may request a modification of the license, *see* § 1.947 of this part,
to authorize use of the channels for commercial operation. The licensee
may also, at the same time or thereafter, seek authorization to transfer
or assign the license, *see* § 1.948 of this part, to any person
eligible for licensing in the General or SMR categories. Applications
submitted pursuant to this paragraph must be filed in accordance with
the rules governing other applications for Commercial Mobile Radio
Service channels, and will be processed in accordance with those rules.
Grant of requests submitted pursuant to this paragraph is subject to the
following conditions:

\* \* \* \* \*

\(3\) Licensees granted authorizations pursuant to paragraph (e)(2) of
this section may at any time request modification of the license to
authorize use of the channels consistent with the rules governing the
category to which they are allocated, provided that the licensee meets
the applicable eligibility requirements.

\* \* \* \* \*

**APPENDIX C**

**SUPPLEMENTAL FINAL REGULATORY FLEXIBILITY**

1.  As required by the Regulatory Flexibility Act (RFA),[^174] Initial
    Regulatory Flexibility Analyses (IRFA) were incorporated in the
    *Notice of Proposed Rule Making* (*Notice*)[^175] and *Report and
    Order and Further Notice of Proposed Rule Making* (*R&O and FNPRM*)
    in WT Docket 99-87.[^176] The Commission sought written public
    comment on the proposals in the *Notice* and *R&O and FNPRM*. This
    Supplemental Final Regulatory Flexibility Analysis (SFRFA) contained
    in this *Memorandum Opinion and Order* (*MO&O*) is limited to
    matters raised on reconsideration or clarification with regard to
    the *R&O and FNPRM* and addressed in this *MO&O*. This SFRFA
    conforms to the RFA.[^177]

# Reason for, and Objectives of, the *Memorandum Opinion and Order*

69. This proceeding was initiated to secure public comment on proposals
    to implement Sections 309(j) and 337 of the Communications Act of
    1934 ("Communications Act"), as amended by the Balanced Budget Act
    of 1997 ("Balanced Budget Act").[^178] The Balanced Budget Act
    significantly revised Section 309(j) of the Communications Act,
    which is the principal statutory provision that governs the
    Commission's auction authority for the licensing of radio services.

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

70. No reconsideration petitions/comments were filed in direct response
    to the previous Final Regulatory Flexibility Analysis (FRFA).
    However, the Commission has reviewed general comments that may
    impact small businesses. The *Report and Order* in this proceeding
    determined that the statutory changes in Section 309(j)(1) and
    exemptions in Section 309(j)(2) are considered in light of the
    Commission's continuing obligation under Section 309(j)(6)(E) to
    avoid mutual exclusivity and to fulfill the public interest
    objectives enumerated in Section 309(j)(3). The Commission also
    concluded that in non-exempt services, the Commission's authority
    under the Balanced Budget Act continues to permit it to adopt
    licensing processes that result in the filing of mutually exclusive
    applications where the Commission determines that such an approach
    would serve the public interest. The Commission concluded that in
    addition to other licensing mechanisms we have used previously, we
    should consider the use of band manager licensing as a future option
    for private as well as commercial services. In the *Report and
    Order*, the Commission determined that the public safety exemption
    applies only to services in which these public safety uses, *i.e.*,
    protection of safety of life, health, and property within the
    meaning of Section 309(j)(2)(A), comprise the dominant use of the
    spectrum. Further, the Commission decided that subject to certain
    safeguards, 800 MHz Business and Industrial/Land Transportation
    licensees should be allowed to modify their licenses to permit
    commercial use, or to assign or transfer their licenses to
    Commercial Mobile Radio Service (CMRS) operators for commercial use.
    The *Report and Order* provided that Section 337 relief should only
    be available if the applicant demonstrates that there is no
    available public safety spectrum in any band in the geographic area
    where the public safety use is proposed. Moreover, the Commission
    concluded that it would consider the state of the competitive
    bidding process when the Section 337 application is received as
    relevant to our determination of whether grant of the waiver request
    and the associated application(s) is in the public interest.

71. In this *Memorandum Opinion and Order*, we affirm the Commission's
    determinations. Moreover, we modify the Commission's rules to
    require Section 337 applicants to enter the service code applicable
    to the type of service they intend to provide. We also note that
    despite the type of service code used, the Section 337 applicant
    will be required to meet the interference protection standards in
    our rules that are applicable to the subject spectrum in order to
    satisfy Section 337(c)(1)(B). Additionally, we modify our rules to
    require that applications filed to modify 800 MHz Private Land
    Mobile Radio (PLMR) channels for use in CMRS systems be processed in
    accordance with CMRS rules and procedures instead of PLMR rules and
    procedures. In that connection, we clarify that a licensee that has
    modified its authorization for use in a CMRS operation, or a CMRS
    operator that acquired PLMR channels via assignment or transfer, may
    at any time submit a modification application to indicate that the
    subject frequencies will be used in a PLMR system, provided that the
    licensee meets the applicable eligibility requirements.

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

72. The RFA directs agencies to provide a description of and, where
    feasible, an estimate of the number of small entities that may be
    affected by the rules adopted. The RFA generally defines the term
    "small entity" as having the same meaning as the terms "small
    business," "small organization," and "small governmental
    jurisdiction."[^179] In addition, the term "small business" has the
    same meaning as the term "small business concern" under the Small
    Business Act.[^180] A small business concern is one which: (1) is
    independently owned and operated; (2) is not dominant in its field
    of operation; and (3) satisfies any additional criteria established
    by the Small Business Administration (SBA).[^181] A small
    organization is generally "any not-for-profit enterprise which is
    independently owned and operated and is not dominant in its
    field.[^182] Nationwide, as of 1992, there were approximately
    275,801 small organizations.[^183]

73. The rule changes effectuated by this *Memorandum Opinion and Order*
    apply to licensees who provide public safety services pursuant to
    Section 337 of the Communications Act of 1934, as amended (the Act),
    and private land mobile radio licensees in the 800 MHz band that are
    regulated under Part 90 of the Commission's Rules.

***Estimates for PLMR Licensees***

74. Private land mobile radio systems serve an essential role in a vast
    range of industrial business, land transportation and public service
    activities. These radios are used by companies of all sizes that
    operate in all U.S. business categories. Because of the vast array
    of PLMR users, the Commission had not developed, nor would it be
    possible to develop, a definition of small entities specifically
    applicable to PLMR users. For the purpose of determining whether a
    licensee is a small business as defined by the Small Business
    Administration (SBA), each licensee would need to be evaluated
    within its own business area. The Commission's fiscal year 1994
    annual report indicates that, at the end of fiscal year 1994, there
    were 1,087,276 licensees operating 12,481,989 transmitters in the
    PLMR bands below 512 MHz.[^184] Further, because any entity engaged
    in a commercial activity is eligible to hold a PLMR license, these
    rules could potentially impact every small business in the U.S.

***Estimates for Public Safety Radio Services and Governmental
Entities***

75. Public Safety radio services include police, fire, local
    governments, forestry conservation, highway maintenance, and
    emergency medical services.[^185] The SBA rules contain a definition
    for small radiotelephone (wireless) companies, which encompasses
    business entities engaged in radiotelephone communications employing
    no more that 1,500 persons.[^186] There are a total of approximately
    127,540 licensees within these services. Governmental entities as
    well as private businesses comprise the licensees for these
    services. The RFA also includes small governmental entities as a
    part of the regulatory flexibility analysis.[^187] "Small
    governmental jurisdiction" generally means "governments of cities,
    counties, towns, townships, villages, school districts, or special
    districts, with a population of less than 50,000."[^188] As of 1992,
    there were approximately 85,006 such jurisdictions in the United
    States.[^189] This number includes 38,978 counties, cities and
    towns; of these, 37,566, or 96 percent, have populations of fewer
    than 50,000.[^190] The Census Bureau estimates that this ratio is
    approximately accurate for all governmental entities. Thus, of the
    85,006 governmental entities, the Commission estimates that 81,600
    (91 percent) are small entities.

# Description of Projected Reporting, Recordkeeping and Other Compliance Requirements

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

# Steps Taken to Minimize Significant Economic Impact on Small Entities and Significant Alternatives Considered

77. The RFA requires an agency to describe any significant alternatives
    that it has considered in reaching its proposed approach, which may
    include the following four alternatives (among others): (1) the
    establishment of differing compliance or reporting requirements or
    timetables that take into account the resources available to small
    entities; (2) the clarification, consolidation, or simplification of
    compliance or reporting requirements under the rule for small
    entities; (3) the use of performance, rather than design, standards;
    and (4) an exemption from coverage of the rule, or any part thereof,
    for small entities.[^191]

78. The Part 1 rule adopted in this *MO&O* clarifies our policies with
    respect to the processing of applications for licenses in the public
    safety radio services under Section 337 of the Act. The revision to
    Part 1 of the Commission's Rules provides guidance toward accurate
    completion of FCC Form 601. This form requires the applicant to
    provide a service code. Although we did consider allowing a Section
    337 applicant to enter a service code commensurate with the
    frequency allocation, other applicants, frequency coordinators or
    other licensees would not know the type of service provided on the
    subject frequency. Moreover, we observe that selection of a service
    code is not a unique requirement for small business, Section 337
    applicants; nor does selection of one service code instead of
    another service code impose an additional economic burden.

79. The Part 90 regulation amended by this *MO&O* designates the rules
    governing CMRS operations as the rules by which applications
    submitted to convert the use of PLMR channels to use in CMRS
    operations will be processed rather than the rules governing
    Industrial/Land Transportation and Business channels. While a small
    business, 800 MHz PLMR licensee who chooses to convert use of its
    frequencies and operate a CMRS system may have to familiarize itself
    with the CMRS rules, it is incumbent upon this agency, *inter alia*,
    to make such regulations as it may deem necessary to prevent
    interference between stations.[^192] For instance, use of PLMR
    channels in CMRS operations must comply with the interference and
    technical requirements that govern CMRS operations to ensure harmful
    interference to existing licensees is avoided. Similarly, use of
    PLMR channels in CMRS operations must comply with the power
    limitations and other operational requirements imposed upon other
    CMRS operators to protect licensees from harmful interference.

**[Report to Congress]{.underline}**: The Commission will send a copy of
this *Memorandum Opinion and Order*, including this Supplemental FRFA,
in a report to be sent to Congress pursuant to the Congressional Review
Act, *see* 5 U.S.C. § 801(a)(1)(A). In addition, the Commission will
send a copy of the *Memorandum Opinion and Order*, including
Supplemental FRFA, to the Chief Counsel for Advocacy of the Small
Business Administration. A copy of the *Memorandum Opinion and Order*
and Supplemental FRFA (or summaries thereof) will also be published in
the Federal Register. *See* 5 U.S.C. § 604(b).

[^1]: Implementation of Sections 309(j) and 337 of the Communications
    Act of 1934 as Amended; Promotion of Spectrum Efficient Technologies
    on Certain Part 90 Frequencies; Establishment of Public Service
    Radio Pool in the Private Mobile Frequencies Below 800 MHz; Petition
    for Rule Making of the American Mobile Telecommunications
    Association, *Report and Order and Further Notice of Proposed Rule
    Making*, WT Docket No. 99-87, RM-9332, RM-9405, RM-9705, 15 FCC Rcd
    22709 (1999) ("*R&O and FNPRM*").

[^2]: Pub. L. No. 103-66, Title VI, § 6002(a), 107 Stat. 312, 387
    (1993).

[^3]: 47 U.S.C. § 309(j)(1) (1996). As added by the 1993 Budget Act,
    Section 309(j)(1) stated,

    \(1\) General Authority. \-- If mutually exclusive applications are
    accepted for filing for any initial license or construction permit
    which will involve a use of the electromagnetic spectrum described
    in paragraph (2), then the Commission shall have the authority,
    subject to paragraph (10), to grant such license or permit to a
    qualified applicant through the use of a system of competitive
    bidding that meets the requirements of this subsection.

    Paragraph (10) provided a number of conditions precedent and
    conditions subsequent to the Commission\'s use of competitive
    bidding, which are moot. *See* 47 U.S.C. § 309(j)(10) (1996).

[^4]: Implementation of Sections 309(j) and 337 of the Communications
    Act of 1934 as Amended; Promotion of Spectrum Efficient Technologies
    on Certain Part 90 Frequencies; Establishment of Public Service
    Radio Pool in the Private Mobile Frequencies Below 800 MHz, *Notice
    of Proposed Rule Making*, WT Docket No. 99-87, RM-9332, RM-9405, 14
    FCC Rcd 5206 (1999) ("*Notice*").

[^5]: *See id.* at 5208-21 ¶¶ 3-22. *See also* Implementation of Section
    309(j) of the Communications Act - Competitive Bidding, *Second
    Report and Order*, PP Docket No. 93-253, 9 FCC Rcd 2348 (1994)
    (\"*Competitive Bidding Second Report and Order*\"); Implementation
    of Section 309(j) of the Communications Act - Competitive Bidding,
    *Second Memorandum Opinion and Order*, PP Docket No. 93-253, 9 FCC
    Rcd 7245 (1994).

[^6]: 47 U.S.C. § 309(j)(6)(E).

[^7]: *See* *Notice*, 14 FCC Rcd at 5210 ¶ 4 (citing *Competitive
    Bidding Second Report and Order*, 9 FCC Rcd at 2350 n.5).

[^8]: Renewal licenses were excluded from the auction process. *See*
    H.R. Rep. No. 103-111, at 253. *See also id.* at 2355.

[^9]: *See* 47 U.S.C. § 309(j)(2)(A) (1996).

[^10]: Among the services found to be auctionable under the 1993 Budget
    Act were narrowband and broadband Personal Communications Services,
    Public Mobile Services, 218-219 MHz Service, Specialized Mobile
    Radio Services (SMR), Private Carrier Paging (PCP) Services,
    Multipoint Distribution Service (MDS), Local Multipoint Distribution
    Service (LMDS), 2.3 GHz Wireless Communications Service (WCS),
    satellite Digital Audio Radio Service (DARS), Direct Broadcast
    Satellite (DBS) Service, 220-222 MHz Radio Service, Location and
    Monitoring Service (LMS), and VHF Public Coast Stations, all of
    which involve commercial use of the spectrum. *See Notice*, 14 FCC
    Rcd at 5212-13 ¶ 8; *see also Competitive Bidding Second Report and
    Order*, 9 FCC Rcd at 2359 ¶¶ 62-63. The plain language of the 1993
    Budget Act also excluded traditional broadcast services from
    competitive bidding, because broadcast licensees do not receive
    compensation from subscribers. *See Competitive Bidding Second
    Report and Order*, 9 FCC Rcd at 2352 ¶ 22.

[^11]: 47 U.S.C. § 309(j)(2)(B) (1996). Section 309(j)(3), entitled
    "Design of Systems of Competitive Bidding," directs that these
    factors be addressed in both identifying classes of licenses to be
    issued by competitive bidding, and designing particular
    methodologies of competitive bidding:

    \(A\) the development and rapid deployment of new technologies,
    products, and services for the benefit of the public, including
    those residing in rural areas, without administrative or judicial
    delays;

    \(B\) promoting economic opportunity and competition and ensuring
    that new and innovative technologies are readily accessible to the
    American people by avoiding excessive concentration of licenses and
    by disseminating licenses among a wide variety of applicants,
    including small businesses, rural telephone companies, and
    businesses owned by members of minority groups and women;

    \(C\) recovery for the public of a portion of the value of the
    public spectrum resource made available for commercial use and
    avoidance of unjust enrichment through the methods employed to award
    uses of that resource; and

    \(D\) efficient and intensive use of the electromagnetic spectrum.

    47 U.S.C. § 309(j)(3)(A)-(D).

[^12]: *See Notice*, 14 FCC Rcd at 5212-14 ¶¶ 8-9. *See also* *supra*
    n.10.

[^13]: *See Notice*, 14 FCC Rcd at 5214-19 ¶¶ 10-17.

[^14]: Pub. L. No. 105-33, Title III, 111 Stat. 251 (1997) ("Balanced
    Budget Act").

[^15]: 47 U.S.C. § 397(6). Section 397(6) defines the terms
    \"noncommercial educational broadcast station\" and \"public
    broadcast station.\"

[^16]: 47 U.S.C. § 309(j)(1), (2) (as amended by Balanced Budget Act, §
    3002) (footnote added).

[^17]: *See* 47 U.S.C. § 309(j)(1), (2) (1996).

[^18]: *See* 47 U.S.C. § 309(j)(2) (emphasis added)*.*

[^19]: Implementation of Section 309(j) of the Communications Act \--
    Competitive Bidding for Commercial Broadcast and Instructional
    Television Fixed Service Licenses, *First Report and Order*, MM
    Docket No. 97-234, 13 FCC Rcd 15920, 16000 ¶ 199 (1998).

[^20]: The conferees expressed concern that the Commission not interpret
    its expanded auction authority in a manner that overlooks
    engineering solutions or other tools that avoid mutual exclusivity.
    *See* H.R. Conf. Rep. No. 105-217, 105th Cong., 1st Sess., at 572
    (1997) ("Conference Report").

[^21]: *See R&O and FNPRM*, 15 FCC Rcd at 22719-22 ¶¶ 21-25.

[^22]: *Id*.

[^23]: *Id*. at 22727-35 ¶¶ 35-50.

[^24]: *Id*. at 22746-47 ¶¶ 75-78. The other statutory exemptions were
    not addressed in the *R&O*, and will not be discussed in this
    *MO&O*. *See id.* at 22739 ¶ 62.

[^25]: *Id*. at 22744 ¶¶ 72-73.

[^26]: *Id*. at 22760-64 ¶¶ 109-19; *see also* 47 C.F.R. §§ 90.179(i),
    90.621(e)(2).

[^27]: *R&O and FNPRM*, 15 FCC Rcd at 22762-63 ¶¶ 114-15; *see also* 47
    C.F.R. § 90.621(e)(2).

[^28]: *R&O and FNPRM*, 15 FCC Rcd. at 22769-70 ¶¶ 133-35.

[^29]: *Id*. at 22769 ¶ 132.

[^30]: AAA Petition for Reconsideration (filed Feb. 1, 2001).

[^31]: Cinergy Corporation Petition (Cinergy Petition); Commonwealth
    Edison Company Petition (Commonwealth Edison Petition); Consolidated
    Edison Company of New York Petition (Consolidated Edison Petition);
    Entergy Corporation Petition (Entergy Petition); Kansas City Power &
    Light Company Petition (KCPL Petition); Omaha Public Power District
    Petition (Omaha Petition); Scana Corporation Petition (Scana
    Petition); Union Electric Company *et al*. Petition (Union
    Electric); Xcel Energy, Inc. Petition (Xcel Petition) (all filed
    Feb. 1, 2001).

[^32]: CSAA Petition for Reconsideration (filed Feb. 1, 2001).

[^33]: UTC Petition for Reconsideration (filed Feb. 1, 2001).

[^34]: AllCom Petition for Reconsideration (filed Jan. 31, 2001).

[^35]: APCO Petition for Reconsideration (filed Feb. 2, 2001).

[^36]: *See R&O and FNPRM*, 15 FCC Rcd at 22718-23 ¶ 18-27.

[^37]: *See R&O and FNPRM*, 15 FCC Rcd at 22719-23 ¶ 19-27.

[^38]: *See id.* at 22719-20 ¶ 21.

[^39]: *See* UTC Petition at 9.

[^40]: *See id.* at 9 (citing *R&O and FNPRM*, 15 FCC Rcd at 22711 ¶ 3).

[^41]: *See R&O and FNPRM*, 15 FCC Rcd at 22722-23 ¶ 27.

[^42]: *See* UTC Petition at 9-10.

[^43]: *See R&O and FNPRM*, 15 FCC Rcd at 22718-22 at ¶¶ 20-25
    (rejecting statutory interpretation proposed by UTC and other
    private radio entities).

[^44]: *See id*. at 22719-20 ¶ 21.

[^45]: *See* *id*. at 22721-22 ¶ 25 (citations omitted).

[^46]: *See id.* at n.46 and ¶ 25 (citing *Benkelman Telephone Co. v.
    FCC,* 220 F.3d 601, 606 (D.C. Cir. 2000), *petition for rehearing
    denied* (Oct. 25, 2000))*.*

[^47]: *See id.*, 15 FCC Rcd at 22719-20 ¶ 21.

[^48]: The Commission is also considering the possible use of band
    manager licensing in certain of the bands that are being transferred
    from the Federal Government to non-government uses. *See*
    Reallocation of the 216-220 MHz, 1390-1395 MHz, 1427-1429 MHz,
    1429-1432 MHz, 1432-1435 MHz, 1670-1675 MHz, and 2385-2390 MHz
    Government Transfer Bands, *Notice of Proposed Rule Making*, ET
    Docket No. 00-221, 15 FCC Rcd 22657 (2000).

[^49]: Cinergy Petition at 14-15; Consolidated Edison Petition at 14-15;
    Entergy Petition at 14-15; KCPL Petition at 15-16; Omaha Petition at
    16; Scana Petition at 15-16; Union Electric *et al*. Petition at 15;
    Xcel Petition at 14-15; Consolidated Edison Petition at 15-16.

[^50]: Cinergy Petition at 15; Consolidated Edison Petition at 15;
    Entergy Petition at 15; KCPL Petition at 15-16; Omaha Petition at
    16; Scana Petition at 16; Union Electric *et al*. Petition at 15;
    Xcel Petition at 14-15; Consolidated Edison Petition at 16.

[^51]: *See* *R&O and FNPRM*, 15 FCC Rcd at 22725-26 ¶ 32.

[^52]: *See* Cinergy Petition at 14-15 ("The Band Manager also
    frustrates another purpose of Title III; (sic) to promote the safety
    of life and property and to further the public interest in the grant
    of radio licenses. These purposes are completely ignored if the
    Commission allows a Band Manager to decide who is allowed to use the
    spectrum."); Consolidated Edison Petition at 14-15 (same); Entergy
    Petition at 14-15 (same); KCPL Petition at 15-16 (same); Omaha
    Petition at 16 (same); Scana Petition at 15-16 (same); Union
    Electric *et al* Petition at 15 (same); Xcel Petition at 14-15
    (same); and Consolidated Edison Petition at 15-16 (same).

[^53]: *R&O and FNPRM*, 15 FCC Rcd at 22727 ¶ 35. In addition, the
    Commission pointed out that "we have no plans at this time to
    implement band manager licensing in existing private radio service
    that are licensing on a site-by-site basis." *R&O and FNPRM*, 15 FCC
    Rcd at 22732 ¶ 44.

[^54]: *See R&O and FNPRM*, 15 FCC Rcd at 22734 ¶ 49.

[^55]: *See* Cinergy Petition at 15-16; Consolidated Edison Petition at
    15-16; Entergy Petition at 15-16; KCPL Petition at 16; Omaha
    Petition at 17; Scana Petition at 16-17; Union Electric *et al*.
    Petition at 16; and Xcel Petition at 15; Consolidated Edison
    Petition at 16-17.

[^56]: *See R&O and FNPRM*, 15 FCC Rcd at 22730 ¶ 42. *See also* Service
    Rules for the 746-764 and 776-794 MHz Bands, and Revisions to Part
    27 of the Commission's Rules, *Second Report and Order*, WT Docket
    No. 99-168, 15 FCC Rcd 5299, 5319-21 ¶¶ 42-47 (2000).

[^57]: *See* Conference Report at 572.

[^58]: *See R&O and FNPRM*, 15 FCC Rcd at 22744-48 ¶¶ 75-78.

[^59]: *See id.* at 22744 ¶¶ 72-73. This "dominant use" test applies
    only when we are considering licensing additional applicants in an
    existing service in the same frequency band. It does not apply to
    new services, such as new service "overlays," in such a band. *See*
    para. 38, *infra*.

[^60]: *Id*.

[^61]: *See* AAA Petition; CSAA Petition; Cinergy Petition; Commonwealth
    Edison Petition; Consolidated Edison Petition; Entergy Petition;
    KCPL Petition; Omaha Petition; Scana Petition; Union Electric *et
    al*. Petition; UTC Petition; Xcel Petition.

[^62]: *R&O and FNPRM,* 15 FCC Rcd at 22741 ¶ 66.

[^63]: *Id*.

[^64]: AAA Petition at 7; Cinergy Petition at 2-3, 7; Commonwealth
    Edison Petition at 2-3, 7; Consolidated Edison Petition at 2-3, 7;
    Entergy Petition at 2-3, 7; KCPL Petition at 2-3, 7; Omaha Petition
    at 2-3, 7; Scana Petition at 2-3, 7; Union Electric *et al*.
    Petition at 2-3, 7; Xcel Petition at 2-3, 7.

[^65]: Cinergy Petition at 2-5; Entergy Petition at 2-5.

[^66]: *See* 47 U.S.C. § 309(j)(2)(A).

[^67]: In addition, we note that Section 337 of the Communications Act,
    47 U.S.C. § 337, does allow entities providing public safety
    services to obtain spectrum not allocated for public safety use,
    under certain conditions.

[^68]: *R&O and FNPRM,* 15 FCC Rcd at 22741 ¶ 66.

[^69]: *See supra* para. 24.

[^70]: *See* paras. 28 and 36 *infra*.

[^71]: *See, e.g*., Cinergy Petition at 8.

[^72]: *National Public Radio, Inc. v. FCC*, 254 F.3d 226 (D.C. Cir.
    2001) (NPR).

[^73]: *Id*. at 227. *See generally* Reexamination of the Comparative
    Standards for Noncommercial Educational Applicants, *Second Notice
    of Proposed Rulemaking*, MM Docket No. 95-31, FCC 02-44 (Feb. 25,
    2002).

[^74]: *NPR,* 254 F.3d 226, 229, *supra*.

[^75]: *Id.*

[^76]: *See id.*

[^77]: *See* 47 U.S.C. § 309(j)(3).

[^78]: Under Section 309(j)(3) of the Communications Act, in developing
    a competitive bidding methodology and specifying the characteristics
    of licenses to be assigned by auction, the Commission is required to
    promote a number of objectives, including the development and rapid
    deployment of new technologies, products, and services for the
    benefit of the public, the promotion of economic opportunity and
    competition, the recovery of a portion of the value of the spectrum
    made available for commercial use, and the efficient and intensive
    use of the spectrum, in a manner that provides adequate time for
    interested parties to develop their business plans. 47 U.S.C. §
    309(j)(3)(A)-(E). *See R&O and FNPRM*, 15 FCC Rcd at 22720 ¶ 23.

[^79]: Amendment of Part 90 of the Commission's Rules To Adopt
    Regulations for Automatic Vehicle Monitoring Systems, *Order on
    Reconsideration of the Second Report and Order*, PR Docket No.
    93-61, 14 FCC Rcd 1339, 1345 ¶ 10 (1999) (*LMS Reconsideration
    Order*) (denying petition for reconsideration of Hennepin County,
    Minnesota seeking an exemption under Section 309(j)(2) from the
    Commission's auction of licenses in the Location and Monitoring
    Service (LMS)). Subsequently, Hennepin County sought LMS frequencies
    under Section 337, and that application also was denied. *See*
    Hennepin County, *Order*, 14 FCC Rcd 19418, 19423 ¶ 10 (WTB 1999)
    (denying a request for waiver pursuant to Section 337, which was
    filed five weeks before the commencement of the LMS auction, for
    failure to meet statutory requirements).

[^80]: *See LMS Reconsideration Order*, 14 FCC Rcd at 1345 ¶ 10.

[^81]: *See id.*

[^82]: *See* 47 U.S.C. § 309(j)(3)(A)-(E).

[^83]: *See* 47 U.S.C. § 303(y). Consistent with the statutory dictate
    of Section 303(y), the Commission has recognized that flexible
    spectrum allocations may result in more efficient spectrum markets
    which may, in turn, result in more efficient use of the spectrum.
    *See* Principles for Reallocation of Spectrum To Encourage the
    Development of Telecommunications Technologies For the New
    Millennium, *Policy Statement*, 14 FCC Rcd 19868, 19870-71 ¶ 9
    (1999).

[^84]: *See R&O* *and FNPRM,* 15 FCC Rcd at 22751-52 ¶ 87.

[^85]: 47 U.S.C. §§ 303(y) ,309(j)(3)(A)-(E).

[^86]: *R&O* *and FNPRM,* 15 FCC Rcd at 22751-52 ¶ 87.

[^87]: *R&O and FNPRM*, 15 FCC Rcd at 22741-42 ¶ 67. The definition
    consists of the definition of "internal system" contained in Part
    90, adapted to include fixed services which are governed by Part 101
    of our Rules. *Id.*

[^88]: CSAA Petition at 4.

[^89]: *Id.*

[^90]: *Id*. at 4-5.

[^91]: *See id*. at 4-5. With respect to alarm monitoring services,
    fixed passive telemetry devices, either two-way transceivers polled
    by stations, or one-way transmitters programmed to send messages to
    stations at certain intervals are installed at end users' premises.

[^92]: *Id*. at 5.

[^93]: *Id*.

[^94]: *See* Amendment of the Commission's Rules Regarding Multiple
    Address Systems, *Memorandum Opinion and Order*, WT Docket No.
    97-81, 16 FCC Rcd 12181, 12187 ¶ 11 (2001). Generally, the private
    internal definition contained in the MAS proceeding was drafted to
    specifically deal with services offered under MAS, while the
    definition in the Balanced Budget Act proceeding was drafted for any
    service. Thus, the uses that are deemed private internal in the
    context of MAS will also be deemed private internal with regard to
    examining the types of spectrum uses against the definition
    contained in the Balanced Budget Act proceeding.

[^95]: *Id* at 12186 n.26.

[^96]: *See R&O and FNPRM*, 15 FCC Rcd at 22744 ¶¶ 72-73.

[^97]: *See id*. at 22744 ¶ 73.

[^98]: *See id*. For existing bands, we note that the Commission's
    database for wireless services, ULS, allows examination of the
    service code, which reflects the type of service the licensee
    provides and how the spectrum will be used.

[^99]: Cinergy Petition at 4; Commonwealth Edison Petition at 4;
    Consolidated Edison Petition 4; Entergy Petition at 4; KCPL Petition
    at 4; Omaha Petition at 4; Scana Petition at 4; Union Electric, *et
    al*. Petition at 4; Xcel Petition at 4.

[^100]: *Chevron, U.S.A., Inc. v. NRDC, Inc*., 467 U.S. 837 (1984)*; see
    also NLRB V. United Food & Commercial Workers Union*, 484 U.S. 112,
    123 (1987). Step 1 of the *Chevron* analysis requires the
    determination of whether Congress has directly spoken to the issue.
    If Congress has not directly spoken on the precise question at issue
    then Step 2 of the analysis requires a determination of whether the
    agency's answer is based on a permissible construction \-- one that
    is rational and consistent with the statute \-- is required.
    Furthermore, an agency must adequately articulate the reasons
    underlying its construction of a statute, so that a reviewing court
    can properly perform the analysis set forth in *Chevron*. *Acme Die
    Casting v. NLRB*, 26 F.3d 162, 166 (D.C. Cir. 1994).

[^101]: Cinergy Petition at 11-14; Commonwealth Edison Petition at
    11-14; Consolidated Edison Petition 11-14; Entergy Petition at
    11-14; KCPL Petition at 11-14; Omaha Petition at 11-14; Scana
    Petition at 11-14; Union Electric, *et al*. Petition at 11-14; Xcel
    Petition at 11-14.

[^102]: Cinergy Petition at 4, 7-10; Commonwealth Edison Petition at 4,
    7-10; Consolidated Edison Petition 4, 7-10; Entergy Petition at 4,
    7-10; KCPL Petition at 4, 7-10; Omaha Petition at 4, 7-10; Scana
    Petition at 4, 7-10; Union Electric, *et al*. Petition at 4, 7-10;
    Xcel Petition at 4, 7-10. Petitioners also argue that the "dominant
    use" test violates the Administrative Procedure Act and is arbitrary
    and capricious for two reasons: (1) procedurally, the Commission did
    not adequately explain why it used the dominant use test and how it
    was applied; and (2) in applying the dominant use test, the
    Commission did not consider the clear intent of Congress in
    implementing the exemption for public safety radio services.

[^103]: Cinergy Petition at 7-10; Commonwealth Edison Petition at 7-10;
    Consolidated Edison Petition at 7-10; Entergy Petition at 7-10; KCPL
    Petition at 7-10; Omaha Petition at 7-10; Scana Petition at 7-10;
    Union Electric, *et al*. Petition at 7-10; Xcel Petition at 7-10.
    *See also* UTC Petition at 2 (stating that "beyond the shared bands
    below 470 MHz, the negative impact of auctions upon public safety
    radio services in private land mobile bands would contravene the
    intent of Section 309(j)(2) to preserve and promote public safety
    radio service by utilities, pipeline companies and railroads, among
    others").

[^104]: Cinergy Petition at 4, 8-9; Commonwealth Edison Petition at 4,
    8-9; Consolidated Edison Petition at 4, 8-9; Entergy Petition at 4,
    8-9; KCPL Petition at 4, 8-9; Omaha Petition at 4, 8-9; Scana
    Petition at 4, 8-9; Union Electric, *et al*. Petition at 4, 8-9;
    Xcel Petition at 4, 8-9.

[^105]: Cinergy Petition at 4, 8-9; Commonwealth Edison Petition at 4,
    8-9; Consolidated Edison Petition at 4, 8-9; Entergy Petition at 4,
    8-9; KCPL Petition at 4, 8-9; Omaha Petition at 4, 8-9; Scana
    Petition at 4, 8-9; Union Electric, *et al*. Petition at 4, 8-9;
    Xcel Petition at 4, 8-9.

[^106]: *See supra* ¶¶ 23-28.

[^107]: *See, e.g., R&O and FNPRM*, 15 FCC Rcd at 22715-16 ¶ 14;
    Conference Report.

[^108]: *R&O and FNPRM*, 15 FCC Rcd at 22748 ¶ 79.

[^109]: Indeed, the Conference Report provided an in-depth discussion
    distinguishing not-for-profit road services, such as AAA, and
    for-profit road services. *See* Conference Report at 572 (noting the
    value of the public safety service provided by emergency road
    services and stating that the exemption does not include internal
    radio services used to support emergency road services as part of a
    competitive marketing package).

[^110]: *See* Amendment of the Commission's Rules Regarding Multiple
    Address Systems, WT Docket No. 97-81*, Report and Order*, 15 FCC Rcd
    11956, 11962 ¶ 12 (2000) (citing *DirecTV, Inc. v. FCC*, 110 F.3d
    816, 828 (1997)) (*MAS R&O*).

[^111]: *See R&O and FNPRM*, 15 FCC Rcd at 22744 ¶ 73; *see also
    Notice*, 14 FCC Rcd at 5225 ¶ 30.

[^112]: *See R&O and FNPRM*, 15 FCC Rcd at 22744 ¶ 73 (citing *MAS R&O*,
    15 FCC Rcd at 11965 ¶ 20, 11967 ¶ 25).

[^113]: *See supra* ¶ 28.

[^114]: *MAS Report and Order*, 15 FCC Rcd 11965, 11967 ¶¶ 20, 25. *See
    also*, *R&O and FNPRM*, 15 FCC Rcd 22746 ¶ 73.

[^115]: *R&O and FNPRM* at 22751 ¶ 85. We note that all existing
    services where some licensees use the spectrum to protect the safety
    of life, health, or property, and others use it for non-public
    safety purposes, are subject to frequency coordination requirements
    or other means of avoiding mutual exclusivity.

[^116]: *See* *supra* ¶ 6. *See also* 47 U.S.C. § 309(j)(2)(A)(i).

[^117]: *See R&O and FNPRM*, 15 FCC Rcd 22746 ¶ 75.

[^118]: *Id*. at 22746-47 ¶¶ 76-78.

[^119]: *See* CSAA Petition at 6-7.

[^120]: *Id*. at 1, 7.

[^121]: *Id*. at 7.

[^122]: *Id*.

[^123]: *See R&O and FNPRM*, 15 FCC Rcd at 22747 ¶ 77.

[^124]: *See, e.g*., UTC Petition at 2 ("Council praises the FCC's
    determination that current shared frequency bands will not be
    subjected to the agony, and in some cases, administrative
    impossibility of geographic overlays and auctions").

[^125]: *Id*. at 2-7.

[^126]: *Id*. at 4-5.

[^127]: *Id*.

[^128]: *See* Reallocation of the 216-220 MHz, 1390-1395 MHz, 1427-1429
    MHz, 1429-1432 MHz, 1432-1435 MHz, 1670-1675 MHz, and 2385-2390 MHz
    Government Transfer Bands, *Notice of Proposed Rulemaking*, WT
    Docket No. 02-08, FCC 02-15 (Feb. 6, 2002).

[^129]: *See Notice*, 14 FCC Rcd at 5216-17 ¶¶ 13-14.

[^130]: *See* 47 U.S.C. § 309(j)(1).

[^131]: *See, e.g., R&O and FNPRM*, 15 FCC Rcd at 22741 ¶ 66.

[^132]: *See* 47 C.F.R. § 1.227(b)(4).

[^133]: *See id.*

[^134]: *See R&O and FNPRM*, 15 FCC Rcd at 22753 ¶ 91. *See* *also*
    Balanced Budget Act § 3002(a)(2)(B)(5). The 1997 amendments
    eliminate the Commission's authority to issue licenses or permits by
    random selection after July 1, 1997, with the exception of licenses
    or permits for noncommercial educational radio television stations.
    *Id.*

[^135]: *Id.* at 22760-64 ¶¶ 109-119.

[^136]: The Commission has defined as trafficking as "speculation,
    barter or trade in licenses." *See* KaStar 73 Acquisition, LLC and
    KaStar 109.2 Acquisition, LLC, Applications for Consent to Transfer
    Control, *Memorandum Opinion and Order*, 15 FCC Rcd 1615, 1619-20 ¶
    12 (1999).

[^137]: *R&O and FNPRM*, 15 FCC Rcd at 22763 ¶ 115; *see* 47 C.F.R. §
    90.621(e)(2). In addition, in the case of licenses that have been
    modified to add 800 MHz Business or I/LT frequencies or to add or
    relocate base stations that expand the licensee's interference
    contour, commercial use of those frequencies or base stations may
    not be requested until five years after the modification. 47 C.F.R.
    § 90.621(e)(2)(ii).

[^138]: *Id*. at 22763 ¶ 116.

[^139]: AllCom Petition at 2.

[^140]: *Id*. at 2-3 n.3.

[^141]: *Id*. at 4.

[^142]: *Id*. at 4 (citing 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, Implementation of Sections 3(n) and 332
    of the Communications Act, Regulatory Treatment of Mobile Services
    and Implementation of Section 309(j) of the Communications Act,
    *Third Report and Order; Fifth Notice of Proposed Rule Making*, PR
    Docket No. 89-552, GN Docket No. 93-252 and PP Docket No. 93-253, 12
    FCC Rcd 10943, 10968-10969 ¶¶ 51-52 (1982)).

[^143]: AllCom Petition at 5.

[^144]: PCIA Opposition at 2.

[^145]: *See* 47 C.F.R. § 1.2111(b)(1).

[^146]: *See* 47 C.F.R. § 90.629.

[^147]: *R&O and FNPRM*, 15 FCC Rcd 22763 ¶ 115.

[^148]: In addition, subsequent applications to modify the technical
    parameters of stations the licenses for which have been modified to
    permit commercial operations will be scrutinized to prevent evasion
    of the five-year holding period. For example, a request to relocate
    the station to serve an area other than that covered by the
    station's prior PLMR operations (or any relocation which together
    with previous post-modification relocations produces such a
    cumulative effect) would be denied.

[^149]: *Id*. at 22786; *see* 47 C.F.R. § 90.621(e)(2).

[^150]: *See* 47 C.F.R. § 90.621(e)(2); *R&O and FNPRM*, 15 FCC Rcd at
    22760-61 ¶ 110.

[^151]: Implementation of Sections 3(n) and 332 of the Communications
    Act and Regulatory Treatment of Mobile Services, *Second Report and
    Order*, GN Docket 93-252, 9 FCC Rcd 1411, 1450-51 ¶¶ 88-93 (1994)
    (noting that SMR systems may be classified as either CMRS or PMRS).

[^152]: 47 C.F.R. § 90.621(e)(2)(iii).

[^153]: *See* 47 U.S.C. § 337(c)(1).

[^154]: *R&O and FNPRM*, 15 FCC Rcd at 22769 ¶ 132.

[^155]: *Id*. at 22769 ¶ 133.

[^156]: *See* 47 U.S.C. § 151.

[^157]: *R&O and FNPRM*, 15 FCC Rcd at 22770 ¶ 135.

[^158]: APCO Petition at 3-6.

[^159]: *Id*. at 3-4; APCO Reply to Opposition at 2.

[^160]: APCO Petition at 6.

[^161]: *Id*. at 4-5.

[^162]: APCO Reply to Opposition at 3.

[^163]: AAR Opposition at 5-6.

[^164]: *Id*. at 6.

[^165]: *See* Conference Report at 579-80.

[^166]: *See* New Hampshire Department of Transportation, *Memorandum
    Opinion and Order*, 14 FCC Rcd 19438 (WTB 1999) (dismissing the
    Section 337 application and waiver request because applicant failed
    to show that no other spectrum allocated to public safety services
    is immediately available to satisfy the requested public safety
    service use); Tennessee Department of Transportation, *Order on
    Reconsideration*. 15 FCC Rcd 24645 (WTB 2000) (dismissing the
    Section 337 application and waiver request because applicant failed
    to show that no other spectrum allocated to public safety services
    is immediately available to satisfy the requested public safety
    service use). *See also* County of Burlington, New Jersey, *Order on
    Reconsideration*, 15 FCC Rcd 16569 (WTB 2000) (granting the Section
    337 application because applicant provided an engineering study and
    an APCO study showing that no public safety spectrum is available in
    any band).

[^167]: APCO Petition at 3-4.

[^168]: *Id*. at 6-7.

[^169]: *Id*. at 7.

[^170]: *Id*.

[^171]: *R&O and FNPRM*, 15 FCC Rcd at 22769-70 ¶¶ 133-35.

[^172]: *See id.* at 22770-71 ¶ 136; 47 C.F.R. § 1.913(g).

[^173]: We note that Section 337 applicants nonetheless will be required
    to meet the interference protection standards in our rules
    applicable to the subject spectrum in order to satisfy Section
    337(c)(1)(B). Consequently, applicants should review the relevant
    rules and include the necessary information in their waiver request.

[^174]: *See* U.S.C. § 603. The RFA, *see* 5 U.S.C. § 601 *et. seq.*.,
    has been amended by the Contract With America Advancement Act of
    1996, Pub. L. No. 104-121, 110 Stat. 847 (1996) (CWAAA). Title II of
    the CWAAA is the Small Business Regulatory Enforcement Fairness Act
    of 1996 (SBREFA).

[^175]: *See* Implementation of Sections 309(j) and 337 of the
    Communications Act of 1934 as Amended; Promotion of Spectrum
    Efficient Technologies on Certain Part 90 Frequencies; Establishment
    of Public Service Radio Pool in the Private Mobile Frequencies Below
    800 MHz; Petition for Rule Making of the American Mobile
    Telecommunications Association, *Report and Order and Further Notice
    of Proposed Rule Making*, WT Docket No. 99-87, RM-9332, RM-9405,
    RM-9705, 15 FCC Rcd 22709 (1999) ("*R&O and FNPRM*").

[^176]: *See* Implementation of Sections 309(j) and 337 of the
    Communications Act of 1934 as Amended; Promotion of Spectrum
    Efficient Technologies on Certain Part 90 Frequencies; Establishment
    of Public Service Radio Pool in the Private Mobile Frequencies Below
    800 MHz, *Notice of Proposed Rule Making*, WT Docket No. 99-87,
    RM-9332, RM-9405, 14 FCC Rcd 5206 (1999) ("*Notice*").

[^177]: *See* 5 U.S.C. § 604.

[^178]: Pub. L. No. 105-33, Title III, 111 Stat. 251 (1997).

[^179]: *See* 5 U.S.C. § 601(6).

[^180]: 5 U.S.C. § 601(3) (incorporating by reference the definition of
    "small business concern" in 15 U.S.C. § 632). Pursuant to the RFA,
    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 which are appropriate to the
    activities of the agency and publishes such definition(s) in the
    Federal Register.

[^181]: Small Business Act, 5 U.S.C. § 632 (1996).

[^182]: 5 U.S.C. § 601(4).

[^183]: 1992 Economic Census, U.S. Bureau of the Census, Table 6
    (special tabulation of data under contract to the Office of Advocacy
    of the Small Business Administration).

[^184]: *See* Federal Communications Commission, 60^th^ Annual Report,
    Fiscal Year 1994 at 120-121.

[^185]: With the exception of the special emergency service, these
    services are governed by Subpart B of Part 90 of the Commission\'s
    rules. 47 C.F.R. §§ 90.15 through 90.27. The police service includes
    26,608 licensees that serve state, county and municipal enforcement
    through telephony (voice), telegraphy (code) and teletype and
    facsimile (printed material). The fire radio service includes 22,677
    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 40,512 licensees
    that are state, county or municipal entities that use the radio for
    official purposes not covered by other public safety services. There
    are 7,325 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 9,480 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 1,460
    licensees in the Emergency Medical Radio Service (EMRS) use the 39
    channels allocated to this service for emergency medical service
    communications related to the actual delivery of emergency medical
    treatment. 47 C.F.R. §§ 90.15 through 90.27. The 19,478 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 communication facilities. 47 C.F.R. §§ 90.33
    through 90.55.

[^186]: *See* 13 C.F.R. § 121.201 (NAICS Codes 513321, 513322, 513330).

[^187]: *See* 5 U.S.C. § 601(5) (including cities, counties, towns,
    townships, villages, school districts, or special districts).

[^188]: 5 U.S.C. § 601(5).

[^189]: U.S. Dept. of Commerce, Bureau of the Census, \"1992 Census of
    Governments.\"

[^190]: *Id.*

[^191]: *See* 5 U.S.C. § 603(c).

[^192]: *See* 47 U.S.C. § 303(f).