Federal Register / Vol. 62, No. 21 / Friday, January 31, 1997 / Rules and Regulations 4657

transmitting antenna that is an integral

part of the device.

(e) Within the 5.15–5.25 GHz band,

U–NII devices will be restricted to

indoor operations to reduce any

potential for harmful interference to cochannel MSS operations.

(f) U–NII devices are subject to the

radio frequency radiation exposure

requirements specified in §§ 1.1307(b),

2.1091 and 2.1093 of this chapter, as

appropriate. All equipment shall be

considered to operate in a ‘‘general

population/uncontrolled’’ environment.

Applications for equipment

authorization of devices operating under

this section must contain a statement

confirming compliance with these

requirements for both fundamental

emissions and unwanted emissions.

Technical information showing the

basis for this statement must be

submitted to the Commission upon

request.

(g) The frequency stability of the

carrier frequency of an intentional

radiator operating under this section

shall be ±10 ppm over 10 milliseconds.

The frequency stability shall be

maintained over a temperature variation

of ¥20 degrees to +50 degrees Celsius

at normal supply voltage, and over a

variation in the primary supply voltage

of 85 percent to 115 percent of the rated

supply voltage at a temperature of +20

degrees Celsius. For equipment that is

capable of operating only from a battery,

the frequency stability tests shall be

performed using a new battery without

any further requirement to vary supply

voltage.

[FR Doc. 97–2007 Filed 1–30–97; 8:45 am]

BILLING CODE 6712–01–P

47 CFR Parts 61 and 69

[CC Docket No. 94–1; FCC 96–488]

Price Cap Performance Review for

Local Exchange Carriers

AGENCY: Federal Communications

Commission.

ACTION: Final Rule.

SUMMARY: On September 14, 1995, the

Commission adopted a Second Further

Notice of Proposed Rulemaking in this

docket, seeking comment on how its

price cap regulation of local exchange

carriers should be revised as the

competition faced by those carriers

grows. In particular, the Commission

sought comment on relaxing the

procedural requirements for establishing

new rate elements for new switched

access services, and eliminating the

lower boundaries of the service band

indices. In this Third Report and Order,

the Commission adopts the rules it

proposed. These rule revisions are

intended to make it easier for local

exchange carriers to introduce new

services, and to lower rates.

EFFECTIVE DATE: Effective June 30, 1997.

FOR FURTHER INFORMATION CONTACT:

Richard Lerner, Attorney, Common

Carrier Bureau, Competitive Pricing

Division, (202) 418–1530. For additional

information concerning the information

collections contained in this Report and

Order contact Dorothy Conway at 202–

418–0217, or via the Internet at

dconway@fcc.gov.

SUPPLEMENTARY INFORMATION: This is a

summary of the Commission’s Report

and Order adopted December 23, 1996,

and released December 24, 1996. The

full text of this Report and Order is

available for inspection and copying

during normal business hours in the

FCC Reference Center (Room 239), 1919

M St., NW., Washington, DC. The

complete text also may be obtained

through the World Wide Web, at http:/

/www.fcc.gov/Bureaus/

CommonlCarrier/Notices/fcc96488.wp,

or may be purchased from the

Commission’s copy contractor,

International Transcription Service,

Inc., (202) 857–3800, 2100 M St., NW.,

Suite 140, Washington, DC 20037. The

Commission released a Second Further

Notice of Proposed Rulemaking, CC

Docket No. 94–1, Further Notice of

Proposed Rulemaking, CC Docket No.

93–124, and Second Further Notice of

Proposed Rulemaking CC Docket No.

93–197 (all three published at 60 FR

49539 (September 25, 1995)) (Price Cap

Second FNPRM) to seek comment on

the rules adopted in the Third Report

and Order.

Regulatory Flexibility Analysis: As

required by the Regulatory Flexibility

Act, the Third Report and Order

contains a Final Regulatory Flexibility

Analysis which is set forth in Section

XI.F of the Third Report and Order. The

Commission concluded that the

Regulatory Flexibility Act is not

applicable because the rules adopted in

the Third Report and Order will not

have a significant impact on a

substantial number of small entities.

Paperwork Reduction Act: Public

burden for the collection of information

is estimated as follows:

OMB Approval Number: None.

Title: Third Report and Order, Price

Cap Performance Review for Local

Exchange Carriers.

Form No.: N/A.

Type of Review: New collection.

Information collection Number of

respondents

Annual hour

burden per

response

Total annual

burden

Elimination of the lower Service Band Index and Petition to offer new switched access services ........ 13 10 130

Total Annual Burden: 130 hours.

Respondents: Business or other forprofit.

Estimated costs per respondent: $0.

Needs and Uses: The agency will use

the data submission to review Local

Exchange Carriers’ proposed new

switched access services. Public

reporting burden for the collection of

information is estimated to average 10

hours per response. Send comments on

the agency’s need for this information,

the accuracy of the provided burden

estimates, and any suggested methods

for minimizing respondent burden,

including through the use of automated

collection techniques to the Federal

Communications Commission, Records

Management Branch, Washington, D.C.

20554.

Final Regulatory Flexibility Act

Certification

In the Price Cap Second FNPRM, we

certified that the Regulatory Flexibility

Act did not apply to this rulemaking

proceeding because none of the rule

amendments under consideration would

have a significant economic impact on

a substantial number of small entities.

We concluded that the proposed rules

would apply only to carriers subject to

price cap regulation for local exchange

access, and such carriers are generally

large corporations or affiliates of such

corporations. No comments were

received concerning the proposed

certification. Since our initial

certification, certain changes occurred.

The Regulatory Flexibility Act was

amended by the Small Business

Regulatory Enforcement Fairness Act of

1996 (‘‘SBREFA’’), and Citizens elected

price cap regulation. Nonetheless, we

certify that the rules adopted herein will

not have a significant economic impact
4658 Federal Register / Vol. 62, No. 21 / Friday, January 31, 1997 / Rules and Regulations

on a substantial number of small

entities.

The Regulatory Flexibility Act defines

a ‘‘small business’’ to be the same as a

‘‘small business concern’’ under the

Small Business Act. Under the Small

Business Act, a ‘‘small business

concern’’ is one that: (1) Is

independently owned and operated; (2)

is not dominant in its field of operation;

and (3) meets any additional criteria

established by the Small Business

Administration. Section 121.201 of the

Small Business Administration

regulations defines a small

telecommunications entity in SIC code

4813 (Telephone Companies Except

Radio Telephone) as any entity with

1,500 or fewer employees at the holding

company level. Entities directly subject

to these rule changes are carriers subject

to price cap regulation. These entities,

including the newest carrier subject to

price cap regulation, Citizens, are

generally large corporations that have

more than 1,500 employees, or they are

either dominant in their fields of

operations or are not independently

owned or operated. Thus, they are not

‘‘small entities’’ as defined by the Small

Business Act.

We therefore certify that the rules

adopted herein will not have a

significant economic impact on a

substantial number of small entities.

The Commission shall provide a copy of

this certification to the Chief Counsel

for Advocacy of the Small Business

Administration, and include it in the

report to Congress pursuant to the

SBREFA. The certification will also be

published in the Federal Register.

Summary of Report and Order: We

conclude that certain revisions to our

rules should be made upon issuance of

this Order. These changes include

eliminating the price caps lower service

band indices, and substantially easing

the requirements necessary for the

introduction of new services. We make

these adjustments in order to remove

obstacles to lower access prices, and

allow incumbent LECs to recover their

costs in a manner consistent with the

way that costs are incurred. Moreover,

we believe that these changes will not

adversely affect the development of a

competitive marketplace.

A. Lower Service Band Indices

i. Background

1. Our price cap rules divide

incumbent LEC services among four

baskets, with each basket being subject

to a separate price cap index (PCI).

Selected categories of services within

the trunking and traffic-sensitive baskets

are also subject to individual SBIs. Each

tariff year the carrier must establish, for

each such group of services, new upper

and lower bands that are set at specified

percentages above and below the SBI.

Price changes are presumptively lawful

if the API for the basket is at or below

the PCI, and the prices for each category

of services within the basket are within

the established pricing bands. Most

categories of services are currently

subject to lower bands that limit the

annual price reductions for those

categories to ten percent, relative to the

percentage change in the PCI for that

basket, such as the service categories in

the traffic-sensitive and trunking baskets

other than the TIC. Where incumbent

LECs are permitted to deaverage rates,

as when an expanded interconnection

cross-connect for special access or

transport service has been taken in a

LEC study area, annual price reductions

within any zone of the service category

are limited to fifteen percent, although

price reductions for the service category

as a whole cannot go down by more

than 10 percent.

2. In the Price Cap Second FNPRM,

we proposed eliminating the lower

pricing bands for service categories to

permit incumbent LECs to reduce prices

to any level above average variable cost.

We tentatively concluded that the price

cap indices and upper service band

limits would continue to inhibit

predatory pricing effectively.

ii. Discussion

3. We find that removing the lower

service band indices would be in the

public interest, and we therefore

eliminate them. As set forth in the Price

Cap Second FNPRM, we find that this

will lead to lower prices, particularly as

competition emerges and puts pressure

on incumbent LECs to charge rates that

are related to the underlying costs of

providing exchange access services. We

believe that the current PCI and upper

SBIs adequately control predatory

pricing, and that we do not need

AT&T’s conditions for eliminating the

lower SBIs to address predation. If an

incumbent LEC lowers its prices in one

year, the upper SBIs prevent the

incumbent LEC from immediately

raising its rates back to its previous

levels. In addition, we remain skeptical

that incumbent LECs in this context

successfully could engage in predatory

pricing (lowering prices to eliminate

competitors and then raising prices to

above-competitive levels). The lower

service band indices do not prohibit

below-band tariff filings. Rather, they

establish higher cost support

requirements for below-band filings,

and a presumption that below-cap,

within-band tariff filings are lawful.

Based on the comments submitted in

response to the Price Cap Second

FNPRM, and in light of our continuing

skepticism about the potential for an

incumbent LEC to engage successfully

in predatory pricing, we conclude that

the presumption of lawfulness that we

have applied to within-band tariff

filings can now be extended to all rate

decreases.

4. We also find that AT&T’s suggested

conditions are not necessary to limit the

‘‘headroom’’ an incumbent LEC might

create by lowering certain access rates

within a basket. We are retaining the

SBI upper bands. Those upper bands

constrain the incumbent price cap LECs’

ability to use headroom to increase rates

for any particular access service beyond

specified percentages. This decision is

consistent with our current treatment of

below-band filings, which are included

in the calculation of an incumbent

LEC’s API. In addition, in this NPRM,

we invite comment on two alternative

approaches to access reform. Regardless

of which approach we adopt, access

reform should result in incumbent

LECs’ access rates moving closer to

forward-looking economic cost, and so

would limit the extent to which an

incumbent LEC could take advantage of

any headroom that may be created by

lowering certain access rates.

B. Waiver Requirement for Introduction

of New Services

i. Background

5. In the Price Cap Second FNPRM,

we noted that many incumbent LECs

have argued that new services and

technologies often do not fit the existing

Part 69 rate structure requirements, and

that obtaining a waiver to introduce a

new rate element is costly, timeconsuming, and poses a significant

impediment to the introduction of new

services. Because we found that our

rules may unnecessarily hinder the

introduction of new services, we

proposed to eliminate the current Part

69 requirement that incumbent price

cap LECs seek a waiver each time they

want to establish new rate elements for

a new switched access service.

Specifically, we proposed to modify

Part 69 to permit an incumbent price

cap LEC to introduce a new service by

filing a petition for the new service

based on a public interest standard. We

further proposed that after the first

incumbent LEC had satisfied the public

interest requirement for establishing

new rate elements for a new switched

access service, other incumbent price

cap LECs could introduce identical new

services, and their petitions would be
Federal Register / Vol. 62, No. 21 / Friday, January 31, 1997 / Rules and Regulations 4659

reviewed in an expedited fashion (i.e.,

within ten days).

ii. Discussion

6. We conclude that the relaxed

procedures for introducing new

switched access services that we set

forth in the Price Cap Second FNPRM

will further the public interest, and we

therefore adopt them. We find that

requiring an incumbent LEC to file a

waiver to introduce a new rate element

imposes a costly, time-consuming, and

unnecessary burden on incumbent

LECs, and significantly impedes the

introduction of new services. Also, we

believe that delaying implementation

would not assist in the development of

a competitive marketplace. We therefore

amend Part 69 so that an incumbent

LEC may introduce a new service by

filing a petition for the new service

based on a public interest standard.

7. We also amend Part 69 so that after

the first incumbent LEC has satisfied the

public interest requirement for

establishing new rate elements for a new

switched access service, another

incumbent price cap LEC can file a

petition seeking authority to introduce

identical rate elements for an identical

new service, and its petition will be

reviewed within ten days of the release

of a Public Notice. Parties may file

comments in response to such a petition

within seven days of the Public Notice.

The incumbent LEC shall have authority

to introduce these new rate elements

after expiration of the ten-day period,

unless the Common Carrier Bureau has

informed the LEC that the LEC has not

demonstrated that its new service

qualifies as a ‘‘me-too’’ service. The

incumbent LEC may then file one

subsequent new petition for ‘‘me-too’’

authorization for that service or may file

a public interest petition seeking to

introduce that service. An incumbent

LEC may not seek expedited review

based on our public interest

authorization of a new service based on

a competitive showing, such as was the

case with the NYNEX USPP and

Ameritech Customers First waivers. In

such cases, an incumbent LEC must file

its own petition seeking approval for a

new rate element.

Ordering Clauses

8. It is further ordered that, pursuant

to Sections 1–4, 201–205, and 303(r) of

the Communications Act of 1934, as

amended, 47 U.S.C. 151–154, 201–205,

and 303(r) that the third report and

order is adopted, effective June 30,

1997. The collections of information

contained within are contingent upon

approval by the Office of Management

and Budget.

9. It is further ordered that Parts 61

and 69 of the Commission’s rules, 47

CFR Parts 61 and 69 are amended as set

forth below.

List of Subjects

47 CFR Part 61

Communications common carriers,

Reporting and recordkeeping

requirements, Tariffs.

47 CFR Part 69

Access charges, Communications

common carriers, Reporting and

recordkeeping requirements.

Federal Communications Commission.

William F. Caton,

Acting Secretary.

Rule Changes

Title 47 of the Code of Federal

Regulations, Parts 61 and 69, are

amended as follows:

PART 61—TARIFFS

1. The authority citation for Part 61

continues to read as follows:

Authority: Secs. 1, 4(i), 4(j), 201–205, and

403 of the Communications Act of 1934, as

amended; 47 U.S.C. 151, 154(i), 154(j), 201–

205, and 403, unless otherwise noted.

2. Section 61.47 is amended by

revising paragraphs (e), (g)(1), (g)(2),

(g)(4), and (h)(2) and by removing

paragraph (g)(6) to read as follows:

§ 61.47 Adjustments to the SBI; pricing

bands.

* * * * *

(e) Pricing bands shall be established

each tariff year for each service category

and subcategory within a basket. Except

as provided in paragraphs (f), (g), and

(h) of this section, each band shall limit

the pricing flexibility of the service

category or subcategory, as reflected in

the SBI, to an annual increase of five

percent, relative to the percentage

change in the PCI for that basket,

measured from the levels in effect on

the last day of the preceding tariff year.

For local exchange carriers subject to

price caps as that term is defined in

§ 61.3(x), there shall be no lower pricing

band for any service category or

subcategory.

* * * * *

(g)(1) Local Exchange Carriers—

Service Categories and Subcategories.

Local exchange carriers subject to price

cap regulation as that term is defined in

§ 61.3(x) shall use the methodology set

forth in paragraphs (a) through (d) of

this section to calculate two separate

subindexes: One for the DS1 services

offered by such carriers and the other

for the DS3 services offered by such

carriers. The annual pricing flexibility

for each of these two subindexes shall

be limited to an annual increase of five

percent, relative to the percentage

change in the PCI for the special access

services basket, measured from the last

day of the preceding tariff year. There

shall be no lower pricing band for these

two subindexes.

(2) The upper pricing band for the

tandem-switched transport service

category shall limit the annual upward

pricing flexibility for this service

category, as reflected in its SBI, to two

percent, relative to the percentage

change in the PCI for the trunking

basket, measured from the levels in

effect on the last day of the preceding

tariff year. There shall be no lower

pricing band for the tandem-switched

transport service category.

* * * * *

(4) Local exchange carriers subject to

price cap regulation as that term is

defined in § 61.3(x) shall use the

methodology set forth in paragraphs (a)

through (d) of this section to calculate

a separate subindex for the 800 data

base vertical features offered by such

carriers. The annual pricing flexibility

for this subindex shall be limited to an

annual increase of five percent, relative

to the percentage change in the PCI for

the traffic sensitive basket, measured

from the last day of the preceding tariff

year. There shall be no lower pricing

band for this subindex.

* * * * *

(h) * * *

(2) The annual pricing flexibility for

each of the subindexes specified in

paragraph (h)(1) of this section shall be

limited to an annual increase of five

percent, relative to the percentage

change in the PCI for the trunking

basket, measured from the levels in

effect on the last day of the preceding

tariff year. There shall be no lower

pricing band for these subindexes.

§ 61.49 [Amended]

3. Section 61.49 is amended by

removing paragraph (d) and

redesignating paragraphs (e) through (k)

as paragraphs (d) through (j).

PART 69—ACCESS CHARGES

4. The authority citation for Part 69

continues to read as follows:

Authority: Sec. 4, 201, 202, 203, 205, 218,

403, 48 Stat. 1066, 1070, 1077, 1094, as

amended; 47 U.S.C. 154, 201, 202, 203, 205,

218, 403.

5. Section 69.4 is amended by adding

paragraph (g) to read as follows:

§ 69.4 Charges to be filed.

* * * * *
4660 Federal Register / Vol. 62, No. 21 / Friday, January 31, 1997 / Rules and Regulations

(g)(1) Local exchange carriers subject

to price cap regulation as that term is

defined in § 61.3(x) of this chapter may

establish one or more switched access

rate elements for a new service within

the meaning of § 61.42(g) of this chapter,

upon approval of a petition

demonstrating that:

(i) The establishment of the new rate

element or elements would be in the

public interest; or

(ii) Another local exchange carrier has

previously obtained permission to

establish one or more rate elements

identical to those proposed in the

petition to offer the identical service;

and the original petition did not rely

upon a competitive showing as part of

the public interest justification.

(2) The Chief, Common Carrier

Bureau shall issue a Public Notice of the

filing of a petition under paragraph

(g)(1)(ii) of this section. Parties may file

comments in response to such a petition

within seven days of the Public Notice.

The local exchange carrier shall have

authority to introduce new rate

elements under paragraph (g)(1)(ii) of

this section, after the expiration of ten

days from issuance of the Public Notice,

unless the Chief, Common Carrier

Bureau informs the LEC that the LEC

has not demonstrated that its new

service meets the standards of paragraph

(g)(1)(ii) of this section. The incumbent

LEC may then file one subsequent

petition for authorization of that service

under paragraph (g)(1)(ii) of this section.

[FR Doc. 97–2143 Filed 1–30–97; 8:45 am]

BILLING CODE 6712–01–P

47 CFR Part 73

[MM Docket No. 96–10; RM–8738, RM–8799,

RM–8800, RM–8801]

Radio Broadcasting Services; Ada,

Ardmore, and Comanche, OK, and

Blue Ridge, Bridgeport, Eastland,

Farmersville, Flower Mound,

Greenville, Henderson, Jacksboro,

Mineola, Mt. Enterprise, Sherman and

Tatum, TX

AGENCY: Federal Communications

Commission.

ACTION: Final rule.

SUMMARY: The Commission, at the

request of Hunt Broadcasting, Inc.,

substitutes Channel 244C for Channel

244A at Sherman, Texas, reallots

Channel 244C to Flower Mound, and

modifies the license of Station KIKM to

specify operation on Channel 244C at

Flower Mound. At the request of Dean

Broadcasting, Inc., the Commission

substitutes Channel 262A for Channel

260C3 at Henderson, Texas, reallots

Channel 262A to Tatum, Texas, and

modifies the license of Station KGRI to

specify operation on Channel 262A at

Tatum. See 61 FR 6335, February 20,

1996. To accommodate these

reallotments, we are substituting

channels and modifying authorizations

at seven communities. Specifically, we

are substituting Channel 236A for

Channel 244A at Eastland, Texas, and

modifying the Station KVMX license to

specify operation on Channel 236A. We

are substituting Channel 299A for

Channel 252A at Jacksboro, Texas, and

modifying the Station KAIH

construction permit to specify operation

on Channel 299A. We are substituting

Channel 252A for Channel 244A at

Bridgeport, Texas, and modifying the

Station KBOC license to specify

operation on Channel 252A. We are

substituting 246A for Channel 245C2 at

Comanche, Oklahoma, and modifying

the Station KDDQ license to specify

operation on Channel 246A. We are

substituting Channel 253A for Channel

243A at Ardmore, Oklahoma, and

modifying the Station KRXZ license to

specify operation on Channel 253A. We

are substituting Channel 257A for

Channel 244A at Ada, Oklahoma, and

modifying the Station KADA license to

specify operation on Channel 257A. We

are substituting Channel 260A for

Channel 244A at Mineola, Texas, and

modifying the Station KMOO license to

specify operation on Channel 260A. We

are allotting Channel 221A to

Farmersville, Texas, and Channel 260A

to Mt. Enterprise, Texas. Finally, we are

dismissing a request by Thomas S.

Desmond for a Channel 260A allotment

at Blue Ridge, Texas, a request by

Greenville Broadcasting for a Channel

260C3 allotment at Greenville, Texas,

and a request by Galen O. Gilbert for a

Channel 260C3 allotment at

Farmersville, Texas. The reference

coordinates for the Channel 236A

allotment at Eastland, Texas, are 32–28–

34 and 98–50–20. The reference

coordinates for the Channel 299A

allotment at Jacksboro, Texas, are 33–

14–14 and 98–09–43. The reference

coordinates for the Channel 252A

allotment at Bridgeport, Texas, are 33–

13–28 and 97–47–51. The reference

coordinates for the Channel 246A

allotment at Comanche, Oklahoma, are

34–27–24 and 97–55–07. The reference

coordinates for the Channel 253A

allotment at Ardmore, Oklahoma, are

34–14–15 and 97–06–45. The reference

coordinates for the Channel 257A

allotment at Ada, Oklahoma, are 34–42–

31 and 96–44–24. The reference

coordinates for the Channel 244C

allotment at Flower Mound, Texas, are

33–23–12 and 97–33–57. The reference

coordinates for the Channel 221A

allotment at Farmersville, Texas, are 33–

16–21 and 96–21–14. The reference

coordinates for the Channel 260A

allotment at Mineola, Texas, are 32–45–

04 and 95–33–18. The reference

coordinates for the Channel 262A

allotment at Tatum, Texas, are 32–13–35

and 94–33–11. The reference

coordinates for the Channel 260A

allotment at Mt. Enterprise, Texas, are

31–55–06 and 94–40–54. With this

action, the proceeding is terminated.

DATES: Effective March 3,1997. The

window period for filing application for

the Channel 221A allotment at

Farmersville, Texas, and the Channel

260A allotment at Mt. Enterprise, Texas,

will open on March 3,1997, and close

on April 3,1997.

FOR FURTHER INFORMATION CONTACT:

Robert Hayne, Mass Media Bureau (202)

418–2177.

SUPPLEMENTARY INFORMATION: This is a

synopsis of the Commission’s Report

and Order in MM Docket No. 96–10,

adopted December 13, 1996, and

released January 17, 1997. The full text

of this decision is available for

inspection and copying during normal

business hours in the FCC Reference

Center (Room 239), 1919 M Street, NW,

Washington, DC. The complete text of

this decision may also be purchased

from the Commission’s copy contractor,

International Transcription Service,

Inc., (202) 857–3800, 2100 M Street,

NW, Suite 140, Washington, DC. 20037.

List of Subjects in 47 CFR Part 73

Radio broadcasting.

Part 73 of Title 47 of the Code of

Federal Regulations is amended as

follows:

PART 73—[AMENDED]

1. The authority citation for Part 73

continues to read as follows:

Authority: Sections 303, 48 Stat., as

amended, 1082; 47 U.S.C. 154, as amended.

§ 73.202 [Amended]

2. Section 73.202(b), the Table of FM

Allotments under Oklahoma, is

amended by removing Channel 244A

and adding Channel 257A at Ada.

3. Section 73.202(b), the Table of FM

Allotments under Oklahoma, is

amended by adding Channel 253A at

Ardmore.

4. Section 73.202(b), the Table of FM

Allotments under Oklahoma, is

amended by removing Channel 244A,

removing Channel 245C2, and adding

Channel 246A at Comanche.

5. Section 73.202(b), the Table of FM

Allotments under Texas, is amended by