Before the

**Federal Communications Commission**

**Washington, D.C. 20554**

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| In the Matter of                 | * |                              |
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| Possible Revision or Elimination | ) |                              |
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| Certain 800 MHz Licenses         | * |                              |
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**ORDER**

**Adopted:** December 13, 2001 **Released:** December 17, 2001

By the Chief, Private Wireless and Public Safety Division, Wireless
Telecommunications Bureau:

# Introduction

1.  On September 24, 1999, the Commission issued a *Public Notice*,[^1]
    pursuant to the Regulatory Flexibility Act of 1980 as codified in 5
    U.S.C. § 610(b), seeking comment on certain of the Commission's
    Rules. The *Public Notice* focused on Rules published from 1986
    through 1989. Section 610 requires the Commission to review such
    Rules and determine whether the Rules should be continued without
    change, amended or rescinded to minimize "any significant impact . .
    . upon a substantial number of small entities."[^2] On December 10,
    1999, the Commission received comments filed by Small Business in
    Telecommunications (SBT)[^3] requesting amendment of Section 90.629
    of the Commission's Rules.[^4] After careful review of SBT's
    comments, we conclude that a rulemaking proceeding to amend Section
    90.629 of the Commission's Rules along the lines suggested by SBT is
    not warranted at this time.

# BACKGROUND

2.  In December 1995, the Commission adopted a wide-area geographic area
    licensing approach for Specialized Mobile Radio (SMR) systems
    operating in the 800 MHz frequency band.[^5] As part of this
    licensing approach, the Commission adopted construction and coverage
    requirements for Economic Area (EA)[^6] licensees similar to those
    required of broadband Personal Communications Services **(**PCS**)**
    and 900 MHz band SMR licensees.[^7] Contiguous blocks of spectrum
    throughout defined service areas are awarded to single licensees on
    an exclusive basis.[^8]

3.  As a general matter, private land mobile radio (PLMR) systems above
    800 MHz must be constructed and placed in operation within one
    year.[^9] For those 800 MHz PLMR systems that are not constructed
    and placed in operation within one year, the licenses cancel
    automatically.[^10] A PLMR applicant that needs more than 12 months
    to place its 800 MHz station(s) in operation may be permitted to
    take up to five years for constructing and placing a system in
    operation, provided that the applicant meets certain terms and
    conditions specified in Section 90.629 of the Commission's
    Rules.[^11] Specifically, Section 90.629 of the Commission's Rules
    outlines the circumstances under which a licensee may be granted
    extended implementation or \"slow growth\" authority.[^12] Section
    90.629 requires the applicant to file a statement justifying the
    amount of time needed to construct and place its radio station in
    operation.[^13] In addition to a statement of justification, the
    applicant must also show that at least one of three conditions set
    forth in Section 90.629 is satisfied.

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(1) The proposed system will require longer than twelve (12) months to
    construct and place in operation because of its *purpose, size, or
    complexity;* or

(2) The proposed system is to be part of a coordinated or integrated
    wide-area system which will require more than twelve (12) months *to
    plan, approve, fund, purchase, construct, and place in operation;*
    or

(3) The applicant is required by law to follow a multi-year cycle for
    planning, approval, funding, and purchasing the proposed
    system.[^14]

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4.  SBT states that Sections 90.629(a)(1)-(2) of the Commission's Rules
    benefit only large "wide--area system" operators because they fail
    to consider the unique "factors that prevent a small operator from
    timely constructing" its stations.[^15] SBT further states that the
    "purpose, size, or complexity" criteria of Section 90.629(a)(1) is
    unjust to small operators because it subjects them to a "strict
    scrutiny" level of review.[^16] In addition, SBT alleges that it is
    "not aware of any case where the Commission has granted extended
    implementation relief to a commercial operator of a single channel
    system or single trunked system."[^17]

5.  As a result, SBT contends that the Commission's Rules should be
    amended to permit "small businesses" to receive extended
    implementation authority for the construction of radio systems on
    the basis of financial hardship and other reasons.[^18]
    Specifically, SBT recommends that Section 90.629 of the Commission's
    Rules be amended to include a new Section 90.629(f) with the
    following language:

    Those bases under which extended implementation authority may be
    granted under this section for applicants who proposed to operate
    non-wide area systems shall include delays or hardships in obtaining
    financing, physical incapacity of an applicant (if an

    individual), and the rural or remote location proposed to be served
    by the applicant.[^19]

# Discussion

6.  The Regulatory Flexibility Act of 1980 requires us to review the
    Commission's Rules to "minimize any significant economic impact of
    the rule on a substantial number of small entities in a manner
    consistent with the stated objectives of applicable statutes."[^20]
    The Regulatory Flexibility Act of 1980 outlines five factors that we
    must consider in making our determination: (1) the continued need
    for the rule; (2) the nature of complaints or comments received
    concerning the rule from the public; (3) the complexity of the
    rule; (4) the extent to which the rule overlaps, duplicates or
    conflicts with other Federal rules and, to the extent feasible, with
    State and local government rules; and (5) the length of time since
    the rule has been evaluated or the degree to which technology,
    economic conditions, or other factors have changed in the area
    affected by the rule.[^21]

7.  After careful review of SBT's comments and our analysis of the
    applicable Regulatory Flexibility Act 1980 factors, we are not
    persuaded that Section 90.629 of the Commission's Rules should be
    amended at this time. Initially, we note that the "slow growth"
    provisions of Section 90.629 should be considered in the context of
    the Commission's overall construction requirements for Part 90 PLMR
    systems. It is a very specific exception to the Commission's general
    requirement that PLMR systems be constructed and placed in operation
    within a specified period of time.[^22] As noted herein, by adopting
    uniform construction deadlines for PLMR systems, the Commission has
    determined that the specified construction period of one year is a
    reasonable amount of time to construct and place in operation
    traditional PLMR systems.[^23] In this regard, the slow growth
    provisions under Section 90.629 is most appropriately characterized
    as a limited exception to the uniform construction periods for Part
    90 PLMR systems, adopted for certain very specific public interest
    reasons.[^24]

8.  SBT's proposed amendment would permit a single, non-wide area
    licensee to cite *- at any time during the construction process* -
    financial distress or the sudden death of its principal as grounds
    for extended implementation authority. We believe that SBT's
    proposal would add uncertainty and unpredictability to our licensing
    process, thus undermining the Commission's overall goal to promote
    the build-out of this spectrum in an efficient and expeditious
    manner.[^25] Specifically, SBT's proposal would entail creating a
    provision to authorize extended implementation for reasons that are
    not available under the current Part 90 rules. The Commission has
    previously stated that "\[t\]his new scheme is not designed to
    benefit any particular entity, but to provide opportunities for a
    variety of licensees of different sizes to participate in the
    provision of wide-area service."[^26] We believe that SBT's proposal
    would be in direct conflict with this policy. To the extent that SBT
    observes that an operator of a single channel system has not
    received extended implementation authority, we agree because such
    operator would not satisfy the requirements set forth in Section
    90.629. Consequently, it was not envisioned that such operators
    would benefit from the relief extended under Section 90.629 and, as
    a result, it should not be viewed as inconsistent, inequitable or
    unequal treatment that they have not done so.

9.  We also reject the second portion of SBT's proposed amendment that
    would provide for extended implementation authority expressly on the
    basis of a station's rural or remote location.[^27] In this
    connection, we note that two of the three conditions under which
    extended implementation authority is warranted need not be
    inherently tied to large or wide-area systems, and, thus arguably
    are available to small or rural licensees. Specifically, although
    size of a system is one reason warranting extended implementation
    under Section 90.629(b)(1), purpose or complexity of a system are
    equally valid independent reasons. Additionally, the exemption of
    Section 90.629(b)(3) is prospectively available to any entities,
    both small and large, including states, local governments, small
    police or fire departments, and small public utilities (including
    rural utilities) that face multi-year cycles for planning, approval,
    funding and purchasing systems.[^28] As a result, we believe that
    modification of Section 90.629 for this purpose is unnecessary.

10. Further, to the extent that entities, including small business
    entities, are interested in seeking additional time to construct
    their systems, we reiterate that they may do so without availing
    themselves of the provisions of the narrowly-tailored "slow growth"
    provisions set forth in Section 90.629. The Commission's Rules
    expressly provide for requests for extensions of time to construct
    under Section 1.946(e).[^29] We note, however, that these provisions
    are to accommodate involuntary loss of site or other matters beyond
    the control of the licensee,[^30] rather than to accommodate
    failures to obtain financing, to obtain an antenna site, or to order
    equipment in a timely manner.[^31] Nor are they designed to
    accommodate failures to meet construction deadlines caused by
    transfers of control or an intention to assign licenses.[^32] Thus,
    to the extent that SBT wishes to address these types of concerns, it
    would appear, as a general matter, that a request for extension of
    time pursuant to Section 1.946(e) may not be an appropriate source
    of relief under such circumstances. We nonetheless note that the
    Commission's Rules also provide another potential avenue for relief
    should the circumstances presented so warrant. Specifically, Section
    1.925 generally provides guidelines for the filing of a request for
    waiver of the Commission's Rules.[^33]

11. We also note that SBT fails to show duplicity, overlap, or conflict
    between the current rule and other Federal rules, or how changes in
    technology or economic conditions require that Section 90.629 of the
    Commission's Rules be amended. The Commission has amended Section
    90.629 on several occasions,[^34] but, on no occasion has the
    Commission been petitioned to amend Section 90.629 as SBT now
    recommends. In fact, SBT is the only entity to submit comment on the
    issue in the instant proceeding. Indeed, Section 90.629 reflects the
    Commission's response to a significant and growing interest by
    applicants in operating technically innovative, wide-area
    systems.[^35] In addition, Section 90.629 is consistent with the
    Commission's goal to facilitate the efficient use of spectrum
    through a wide-area, geographic-based licensing scheme. Finally,
    while we recognize that both small and large radio operators face a
    highly competitive marketplace, we are not convinced that Section
    90.629 of our Rules poses a significant economic impact on a
    substantial number of small entities, in such a way as to support
    adoption of SBT's proposal.

# CONclusion

12. In the absence of a showing that Section 90.629 of the Commission's
    Rules poses a "significant economic impact . . . on a substantial
    number of small entities," and pursuant to our review under the
    Regulatory Flexibility Act of 1980, we conclude that amendment of
    Section 90.629 of the Commission's Rules, as requested by SBT, is
    not warranted. Thus, we have decided that there is a continuing need
    for Section 90.629 as it is currently constituted, and have decided
    not to amend Section 90.629 as SBT proposes.

#  ordering clauses

13. Accordingly, IT IS ORDERED, pursuant to Sections 4(i), (j), and
    303(r) of the Communications Act of 1934, as amended, 47 U.S.C. §§
    154(i), (j), and 303(r), Sections 1.401(e) and 90.629 of the
    Commission's Rules, 47 C.F.R. §§ 1.401(e) and 90.629, and Section
    610 of the United States Code, 5 U.S.C. § 610, that the Comment and
    Petition for Rulemaking filed by Small Business in
    Telecommunications, on December 10, 1999, IS HEREBY DENIED.

14. This action is taken under delegated authority pursuant to Sections
    0.131 and 0.331 of the Commission's Rules, 47 C.F.R. §§ 0.131,
    0.331.

    FEDERAL COMMUNICATIONS COMMISSION

    D\'wana R. Terry

    Chief, Public Safety & Private Wireless Division

    Wireless Telecommunications Bureau

[^1]: *Public Notice,* "FCC Seeks Comment on Possible Revision or
    Elimination of Rules Under the Regulatory Flexibility Act, 5 U.S.C.
    § 610," (rel. Sept. 24, 1999). This document was published in the
    *Federal Register* on October 14, 1999. 64 Fed. Reg. 55671 (Oct. 14,
    1999).

[^2]: 64 Fed. Reg. at 55671.

[^3]: "SBT is a nonprofit organization formed to forward the interests
    of small business in the area of regulation and legislation in an
    effort to improve the competitiveness and future opportunities for
    small businesses in telecommunications." *See*
    <http://www.sbthome.org/>

[^4]: 47 C.F.R. § 90.629. Comments of Small Business in
    Telecommunications (SBT Comments) filed on December 10, 1999,
    regarding Possible Revision or Elimination of Rules Under the
    Regulatory Flexibility Act.

[^5]: *See* Amendment of Part 90 of the Commission's Rules to Facilitate
    Future Development of SMR Systems in the 800 MHz Frequency Band, PR
    Docket No. 93-144, Implementation of Sections 3(n) and 322 of the
    Communications Act -- Regulatory Treatment of Mobile Services, GN
    Docket No. 93-252, Implementation of Section 309(j) of the
    Communications Act -- Competitive Bidding, PP Docket No. 93-253,
    *First Report and Order, Eighth Report and Order and Second Further
    Notice of Proposed Rulemaking,* 11 FCC Rcd 1463 (1995) (*800 MHz
    Report and Order).* Prior to the adoption of geographic licensing,
    qualified applicants were awarded licenses on a site-by-site,
    channel-by-channel basis.

[^6]: The Bureau of Economic Analysis has divided the Nation into
    regional economic areas that consist of metropolitan areas that are
    centers of economic activity and their economically related
    surrounding counties. *See* Final Redefinition of the BEA Economic
    Areas, 60 Fed. Reg. 13114 (March 10, 1995). There are a total of 175
    Economic Areas. *See* 47 C.F.R. § 90.7 \[*Economic Areas (EAs)*.

[^7]: *800 MHz Report and Order* at 1521 ¶ 104. The Commission had
    previously determined that interconnected SMR services fell within
    the new category of mobile services known as commercial mobile radio
    services (CMRS), such as cellular and broadband PCS licensees. *See*
    Implementation of Sections 3(N) and 332 of the Communications Act,
    GN Docket No. 93-252, *Second Report and Order,* 9 FCC Rcd 1411,
    1448-58 (1994); Implementation of Sections 3(N) and 332 of the
    Communications Act, GN Docket No. 93-252, *Third Report and Order,*
    9 FCC Rcd 7988, 8042-43 (1994) (*Third Report and Order)*.

[^8]: *Third Report and Order*, 9 FCC Rcd 7988, 8042 ¶ 94 (1994).

[^9]: *See* 47 C.F.R. §§ 90.631(e) \[for non-SMR trunked systems\];
    90.633(c) \[for non-SMR conventional systems\].

[^10]: *See* 47 C.F.R. §§ 90.631(f) \[for non-SMR trunked systems\];
    90.633(d) \[for non-SMR conventional systems\].

[^11]: 47 C.F.R. § 90.629; *see also* 47 C.F.R. §§ 90.631(e), 90.633(c).

[^12]: *See* 47 C.F.R. § 90.629.

[^13]: 47 C.F.R. § 90.629 (a). Specifically, this section states that
    the statement "must describe the proposed system, state the amount
    of time necessary to construct and place the system in operation,
    \[and\] identify the number of base stations to be constructed and
    placed in operation during each year of the construction period . .
    . ." *Id.*

[^14]: 47 C.F.R. §§ 90.629(a)(1)-(3) (emphasis added).

[^15]: SBT Comments at 3.

[^16]: *Id.*

[^17]: *Id.*

[^18]: *Id.*

[^19]: *Id.* at 4.

[^20]: 5 U.S.C. § 610(b).

[^21]: 5 U.S.C. § 610(b)(1)-(5).

[^22]: Section 90.629 is not available for commercial (SMR) systems.
    *See* 47 C.F.R. § 90.629(e).

[^23]: *See* general discussion at ¶ 3, *infra*.

[^24]: *Id. See also* 47 C.F.R. § 90.629(a). In this connection, we note
    that often the entities subject to the slow growth provisions are
    utilities and state and local governments.

[^25]: *See 800 MHz Report and Order* at 1529 ¶¶ 120-121 (citing the
    potential for licensees to abuse extended implementation authority,
    resulting in spectrum warehousing or the inability of EA licensees
    to utilize or acquire frequencies that are subject to extended
    implementation authority).

[^26]: *800 MHz Report and Order* at 1479 ¶ 14.

[^27]: SBT Comments at 4.

[^28]: *See* 47 C.F.R. § 1.925.

[^29]: 47 C.F.R. § 1.946(e).

[^30]: 47 C.F.R. § 1.946(e)(1).

[^31]: 47 C.F.R. § 1.946(e)(2).

[^32]: 47 C.F.R. § 1.946(e)(3).

[^33]: *See* 47 C.F.R. § 1.925.

[^34]: *See* Amendment of Part 90 of the Commission's Rules Governing
    Extended Implementation Period, *Report and Order,* PR Docket No.
    92-210, FCC 93-256, 8 FCC Rcd. 3975 (1993) (amending Section 90.629
    to lengthen the maximum extended implementation period from 3 to 5
    years); 11 FCC Rcd 1463 (1995); *800 MHz Report and Order, supra*
    note 5 (ceasing acceptance of requests for extended implementation
    authority); Amendment of Part 90 of the Commission's Rules to
    Facilitate Future Development of SMR Systems in the 800 MHz
    Frequency Band, PR Docket No. 93-144, *Memorandum Opinion and Order
    on Remand,* FCC 99-399, 14 FCC Rcd 21679 (1999) (concluding that SMR
    licensees granted extended implementation authority are sufficiently
    similar to EA licensees that they have similar flexibility with
    respect to construction requirements), *remanded by* *Fresno Mobile
    Radio Inc., et. al. v. Federal Communications Commission,* 165 F. 3d
    965 (D.C. Cir., Feb. 5, 1999).

[^35]: *See, e.g.*, Amendment of Part 90 of the Commission's Rules to
    Facilitate Future Development of SMR Systems in the 800 MHz
    Frequency Band, *Notice of Proposed Rulemaking*, PR Docket No.
    93-144, FCC 93-257, 8 FCC Rcd 3950 (1993) (proposing rules on
    methods of allowing wide-area and advanced system implementation in
    the 800 MHz SMR services); Fleet Call, Inc.*, Memorandum Opinion and
    Order,* FCC 91-56, 6 FCC Rec. 1533 (1991) (granting a request for
    waiver to authorize extended construction period as in the public
    interest, convenience and necessity).