67322 Federal Register / Vol. 65, No. 218 / Thursday, November 9, 2000 / Proposed Rules

Fred Sistarenik, New York State

Department of Public Service,

Communications Division, 3 Empire

State Plaza, Albany, NY 12223.

Cynthia Van Landuyt, Oregon Public

Utility Commission, 550 Capitol

Street, N.E., Suite 215, Salem, OR

97310–2551.

Dated: November 2, 2000

Sharon L. Webber,

Deputy Chief, Accounting Policy Division.

[FR Doc. 00–28606 Filed 11–8–00; 8:45 am]

BILLING CODE 6712–01–P

FEDERAL COMMUNICATIONS

COMMISSION

47 CFR Part 54

[CC Docket No. 96–45; FCC 00–359]

Federal-State Joint Board on Universal

Service: Petition for Forbearance by

Operator Communications, Inc. d/b/a

Oncor Communications, Inc.

AGENCY: Federal Communications

Commission.

ACTION: Notice of proposed rules.

SUMMARY: In this document, the

Commission seeks comment on

proposals to modify the Commission’s

rules relating to contributions to the

federal universal service support

mechanisms. In light of significant

recent developments in the interstate

telecommunications marketplace, such

as the entry of Regional Bell Operating

Companies into the interexchange

services market, we seek comment on

whether the existing methodology

provides or will provide a competitive

advantage to certain carriers in the

marketplace. By initiating this

rulemaking, we seek to ensure that

assessment of contributions to the

federal universal service support

mechanisms remains competitively

neutral, and that the mechanisms

continue to meet the statutory

requirement to be specific, predictable,

and sufficient.

DATES: Comments are due on or before

November 30, 2000. Reply comments

are due on or before December 14, 2000.

Written comments by the public on the

proposed and/or modified information

collections discussed in this Further

Notice of Proposed Rulemaking are due

on or before November 30, 2000.

Written comments must be submitted by

the Office of Management and Budget

(OMB) on the proposed and/or modified

information collections on or before

January 8, 2001.

ADDRESSES: All filings must be sent to

the Commission’s Secretary, Magalie

Roman Salas, Office of the Secretary,

Federal Communications Commission,

445 12th Street, SW., Washington, DC

20554. In addition to filing comments

with the Secretary, a copy of any

comments on the information

collection(s) contained herein should be

submitted to Judy Boley, Federal

Communications Commission, Room 1–

C804, 445 12th Street, SW, Washington,

DC 20554, or via the Internet to

jboley@fcc.gov and to Edward C.

Springer, OMB Desk Officer, 10236

NEOB, 725 17th Street, NW.,

Washington, DC 20503, or via the

Internet to vhuth@omb.eop.gov. Parties

also should send three paper copies of

their filing to Sheryl Todd, Accounting

Policy Division, Common Carrier

Bureau, Federal Communications

Commission, 445 Twelfth Street, SW.,

Room 5–B540, Washington, DC 20554.

FOR FURTHER INFORMATION CONTACT:

Praveen Goyal, Attorney, Common

Carrier Bureau, Accounting Policy

Division, (202) 418–7400. For further

information concerning the information

collection contained in this Further

Notice of Proposed Rulemaking contact

Judy Boley, Federal Communications

Commission, Room 1–C804, 445 12th

Street, SW., Washington, DC 20554, or

via the Internet to jboley@fcc.gov.

SUPPLEMENTARY INFORMATION: This is a

summary of the Commission’s Further

Notice of Proposed Rulemaking in CC

Docket No. 96–45 released on October

12, 2000. The full text of this document

is available for public inspection during

regular business hours in the FCC

Reference Center, Room CY–A257, 445

Twelfth Street, SW., Washington, DC

20554.

This FNPRM contains proposed

information collection(s) subject to the

Paperwork Reduction Act of 1995

(PRA). It has been submitted to the

Office of Management and Budget

(OMB) for review under the PRA. OMB,

the general public, and other Federal

agencies are invited to comment on the

proposed information collections

contained in this proceeding.

Paperwork Reduction Act

The FNPRM contains a proposed

information collection. The

Commission, as part of its continuing

effort to reduce paperwork burdens,

invites the general public and OMB to

comment on the information

collection(s) contained in this FNPRM,

as required by the PRA, Public Law

104–13. Public and agency comments

on the proposed and/or modified

information collections discussed in

this Further Notice of Proposed

Rulemaking are due on or before

November 30, 2000. Written comments

must be submitted by the Office of

Management and Budget (OMB) on the

proposed and/or modified information

collections on or before January 8, 2001.

Comments should address: (a)

Whether the proposed collection of

information is necessary for the proper

performance of the functions of the

Commission, including whether the

information shall have practical utility;

(b) the accuracy of the Commission’s

burden estimates; (c) ways to enhance

the quality, utility, and clarity of the

information collected; and (d) ways to

minimize the burden of the collection of

information on the respondents,

including the use of automated

collection techniques or other forms of

information technology.

OMB Control Number: 3060–0855.

Title: Telecommunications Reporting

Worksheet and Associated

Requirements, CC Docket No. 96–45.

Form No.: FCC Forms 499A and 499S.

Type of Review: Proposed Revision.

Respondents: Businesses or other forprofit.

Proposal 1: Periodic current Revenue

Reports of Proposed Changes to the

Contribution Assessment Methodology.

Title Number of

respondents

Hrs. per

response

Total annual

burden

FCC Form 499A ...................................................................................................................................... 3500 8 28,000

FCC Form 499S ...................................................................................................................................... 2000 5.5 11,000

Periodic Current Revenue Reporting (Monthly) ...................................................................................... 2000 5.5 132,000

Total Annual Burden for Proposal 1 ................................................................................................. .................... .................... 171,000

Federal Register / Vol. 65, No. 218 / Thursday, November 9, 2000 / Proposed Rules 67323

Cost of Respondents: $0.

Needs and Uses: If adopted, this

proposal on which the Commission

seeks comment in the FNPRM may

entail altering the current revenue

reporting requirements to which

interstate telecommunications carriers

are subject under §§ 54.709 and 54.711

of the Commission’s rules. Under one

proposed contribution assessment

methodology, carriers would determine

the amount of their contributions to the

universal service fund by applying the

contribution factor as currently

calculated to their current end-user

revenues, as opposed to their prior-year

end-user revenues. As a result, this

contribution methodology would

require periodic current revenue reports

in addition to the two historical revenue

reports already required semi-annually,

increasing the number of revenue filings

carriers must make to USAC.

Proposal 2: Annual and Quarterly

Reports of Proposed Changes to the

Contribution Assessment Methodology.

Title Number of

respondents

Hrs per

response

Total annual

burden

FCC Form 499A ...................................................................................................................................... 3500 8 28,000

Report of Revenues (Quarterly) .............................................................................................................. 2000 5.5 44,000

Total Annual Burden for Proposal 2 ................................................................................................. .................... .................... 72,000

Cost to Respondents: $0.

Needs and Uses: If adopted, this

proposal on which the Commission

seeks comment in the FNPRM may

entail altering the current revenue

reporting requirements to which

interstate telecommunications carriers

are subject under §§ 54.709 and 54.711

of the Commission’s rules. This

proposed contribution assessment

methodology would shorten the interval

between the accrual of revenues by

carriers and the assessment of universal

service contributions based on those

revenues from a range of 12 to 18

months to a range of 3 to 6 months.

Under this proposal, carriers would

continue to file FCC Form 499A

annually as they are required to do

under the existing methodology.

Carriers would, however, begin to report

their revenues for each quarter by the

beginning of the second month of the

first following quarter. By the 20th day

of the second month of the first

following quarter, USAC would prepare

a quarterly contribution base for the

second following quarter. Finally, as it

does currently, the Commission would

release a proposed contribution factor

for the second following quarter in the

last month of the first following quarter.

Under this proposal, carriers’ filings

increase from the two semi-annual

filings currently required to one annual

filing and four quarterly filings, for a

total of five revenue filings per year.

Synopsis of FNPRM

I. Introduction

1. In this Further Notice of Proposed

Rulemaking (FNPRM), we seek

comment on proposals to modify the

Commission’s rules relating to

contributions to the federal universal

service support mechanisms. Currently,

contributions to the universal service

support mechanisms are based on

carriers’ interstate and international

end-user telecommunications revenues

from the prior year. In light of

significant recent developments in the

interstate telecommunications

marketplace, such as the entry of

Regional Bell Operating Companies

(RBOCs) into the interexchange services

market under section 271 of the

Communications Act, we seek comment

on whether the existing methodology

provides or will provide a competitive

advantage to certain carriers in the

marketplace.

2. By initiating this rulemaking, we

seek to ensure that assessment of

contributions to the federal universal

service support mechanisms remains

competitively neutral, and that the

mechanisms continue to meet the

statutory requirement to be specific,

predictable, and sufficient. Specifically,

in this rulemaking, we seek comment on

the following: (1) A proposed

methodology for the assessment of

universal service contributions based on

current revenues; (2) a proposed

methodology that would reduce the

current interval between the accrual of

revenues and the collection of universal

service contributions based on those

revenues; and (3) other proposals for the

reporting of carrier revenues and the

collection of contributions that maintain

the competitive neutrality of

contributions to the federal universal

service support mechanisms, and that

enable the mechanisms to continue to

meet the statutory requirement to be

specific, predictable, and sufficient.

II. Proposals To Modify the Universal

Service Assessment Methodology

A. Contribution Assessment Generally

3. In light of significant recent

developments in the interstate

telecommunications marketplace, such

as the entry of RBOCs into the

interexchange services market under

section 271 of the Act, we seek

comment generally on whether and how

to modify the existing contribution

assessment methodology. Specifically,

we ask parties to comment on whether,

as a result of changes in the interstate

marketplace, the existing methodology

provides or will provide a competitive

advantage to certain carriers in the

marketplace.

4. Carriers have argued that, as a

result of the existing methodology

which assesses contributions based on

carriers’ interstate end-user

telecommunications revenues from the

prior year, new entrants to the long

distance marketplace, particularly

RBOCs, may have a competitive

advantage as they gain entry into the

long distance market. They argue that,

during the first year of post in-region

interLATA entry, the new entrant is not

required to contribute to the universal

service fund on its interstate end-user

revenues generated from the new inregion interexchange service. If the new

entrants do not accrue a portion of their

revenues for making universal service

contributions during the following year

that will be based on those revenues,

such new entrants may be able to

undercut the prices offered by

established providers.

5. In subsequent years, to the extent

new entrants increase their long

distance market share and recover

universal service contributions against

current end-user revenues, the revenue

base against which they recover their

universal service contributions would

remain greater than the revenue base

against which their contributions are

assessed, creating a potential for a

continuing competitive advantage.

Similarly, carriers have also expressed

concern that, under the existing

contribution methodology, carriers with

decreasing interstate revenues may have

a competitive disadvantage as compared

to carriers with increasing interstate

revenues. As interexchange carriers lose

market share, they may have to recover

from a declining current revenue base

67324 Federal Register / Vol. 65, No. 218 / Thursday, November 9, 2000 / Proposed Rules

their universal service contributions

assessed against a larger prior-year

revenue base.

6. We therefore ask whether and how

to modify the existing contribution

assessment methodology, in light of the

recent developments in the long

distance market. We seek comment on

whether the current methodology would

place interexchange carriers at a

competitive disadvantage against

RBOCs as they gain entry into the long

distance market. We seek comment on

whether any such competitive

advantage might impede the

development of competition in the local

exchange marketplace, for example, by

giving incumbent local exchange

carriers entering the long distance

marketplace a competitive advantage in

the provision of bundled local and long

distance service offerings. We further

seek comment on whether the

contribution methodology

disadvantages carriers with declining

shares of interstate revenues as

compared to carriers with increasing

shares of interstate revenues.

Commenters should also address

whether any such competitive

advantage under the current recovery

methodology would render the

methodology inconsistent with section

254’s requirement that contributions be

‘‘equitable and nondiscriminatory.’’

7. The preceding discussion assumes

that new entrants into the interstate

telecommunications marketplace are

likely to pay universal service

contributions out of current period

revenue. We seek comment on the

likelihood that they instead would

collect a surcharge in their first periods

of operation in order to accrue revenue

for the purpose of making universal

service contributions in subsequent

periods. To the extent new entrants

follow such a procedure, we seek

comment on whether and how

established carriers already contributing

to the universal service mechanisms

would nonetheless be disadvantaged

under the existing contribution

assessment methodology.

8. In the discussion, we seek comment

on two specific proposals to change the

universal service recovery methodology.

We also invite commenters to propose

any other alternatives for assessment of

contributions that are competitively

neutral and consistent with the Act. In

particular, we request comment from

the state members of the Federal-State

Joint Board on Universal Service and

from USAC on the issues raised in this

Further Notice of Proposed Rulemaking.

B. Proposal To Assess Contributions

Based on Current Revenues

9. We seek comment on a proposal to

adopt an assessment methodology based

on current-year revenues, as suggested

by one carrier. Under this proposal, the

contribution factor would continue to be

set quarterly in the same manner as it

is currently, based on the ratio of

estimated federal support to total enduser telecommunications revenues. The

revenue base used in calculating the

contribution factor would continue to be

determined by USAC as it is currently,

based on semi-annual filings of the FCC

Form 499 Telecommunications

Reporting Worksheet by interstate

telecommunications carriers. Carriers,

however, would calculate their

contributions by applying the factor to

their current end-user revenues, as

opposed to their prior-year end-user

revenues. Assuming a level or upward

trend in industry revenues, the

application of a contribution factor

based on prior-year revenues to current

revenues should allow USAC to recover

sufficient contributions from the

industry as a whole in order to fund the

universal service support mechanisms.

We seek comment on whether this

proposal would be competitively

neutral and consistent with the

requirements of section 254 of the Act,

including the requirements that the

Commission’s universal service support

mechanisms be ‘‘equitable and

nondiscriminatory’’ and ‘‘specific,

predictable, and sufficient.’’

10. In particular, we seek comment on

the potential effects of such a

methodology on the integrity of the

universal service fund, including

whether a potential shortfall in the fund

might result. Under the existing

contribution assessment methodology,

the revenue base used in calculating the

contribution factor and the revenue base

against which contributions are assessed

are the same. Under the proposal on

which we seek comment here, which

would apply contribution factors as

presently calculated to current

revenues, the revenue base used in

calculating the contribution factor

would be one year prior to the revenue

base against which contributions would

be assessed. We seek comment on

whether a decline in industry-wide

interstate telecommunications revenues

could generate a shortfall in the

universal service fund under such a

methodology, and whether the

possibility of such a shortfall would

render this proposal inconsistent with

the Act’s mandate of a ‘‘sufficient’’ fund.

We also seek comment on whether

certain events or market conditions,

such as increased use of Internet

Protocol (IP) telephony, changes in

international settlement rates, or

economic recession, might result in a

dramatic or systemic decline in

interstate end-user telecommunications

revenues, and on the likelihood of such

events or conditions and a resultant

decline.

11. We also seek comment on whether

certain safeguards might be adopted

with this proposal to ensure universal

service fund integrity. Specifically, we

ask commenters to address whether a

quarterly ‘‘true-up’’ mechanism could

be implemented with this proposal to

allow USAC to adjust the contribution

assessment rate retrospectively, and

whether mid-quarter contribution factor

adjustments would prevent a shortfall in

the fund caused by a systemic or

extended decline in revenues. We also

seek comment on the effectiveness of

the ‘‘true-up’’ safeguard in light of the

lag that could occur between USAC’s

detection of an impending shortfall in

the fund and the Commission’s

establishment of an adjusted midquarter contribution factor. Commenters

should also discuss the method by

which USAC could project whether

there would be a shortfall in the fund

under this proposed recovery

methodology, and what methodology

should be used to adjust the

contribution factor mid-quarter in the

event of a projected shortfall. Finally,

commenters should discuss any other

possible safeguards they believe should

be included with such a proposal, and

explain why such safeguards should be

implemented.

12. Because this contribution

methodology would require periodic

current revenue reports in addition to

the two historical revenue reports

already required semi-annually, it

would increase the number of revenue

filings carriers must make to USAC.

Consequently, this contribution

recovery methodology may also pose

significant administrative burdens for

carriers and for USAC, which we ask

commenters to address. Specifically, we

seek comment on the frequency with

which carriers should report revenues to

USAC under this proposal, the types of

burdens carriers will face in

periodically reporting revenues to

USAC, and whether the costs of such

reporting are outweighed by the

potential benefits posed by the proposed

methodology. Where possible,

commenters, especially small

businesses, should quantify the costs

and benefits of this proposal. We also

seek comment on how USAC’s billing

and collection procedures would need

to be revised to accommodate this

Federal Register / Vol. 65, No. 218 / Thursday, November 9, 2000 / Proposed Rules 67325

contribution methodology. Currently,

USAC calculates individual

contributions by multiplying the

quarterly contribution factor by the

applicable period of historic quarterly

revenues. USAC then bills contributors

in equal monthly installments at a fixed

amount each month. We seek comment

on whether and/or how this procedure

should be modified under an

assessment methodology based on

current revenues.

13. We seek comment on the

incentives carriers may have under this

proposed recovery methodology to

report their current revenues in an

accurate and timely manner. For

example, this proposal may create

incentives for carriers to underreport

revenues for the early months of a

reporting period in an attempt to reduce

their current contribution obligations,

thereby freeing capital for other uses,

such as interest-bearing investments.

Such carriers could then overreport

revenues in the later months of a

reporting period so that their total

revenues for the reporting period are

accurate. We seek comment on the

extent to which this proposal creates

such incentives and the likelihood that

a shortfall in the fund might result. We

also seek comment on whether changes

should be made to USAC’s auditing

abilities to ensure accurate reporting,

and on any other administrative

mechanisms that might be implemented

to ensure accurate reporting of current

revenues. Commenters should address

measures USAC should take to verify

carrier revenue reports, and what

burdens or costs USAC would bear in

performing such verifications. Parties

should explain the procedures that

should be followed where a carrier’s

current revenue reports do not reconcile

with its report of annual revenues filed

the following April, and whether

penalties should be imposed on such a

carrier. We also seek comment on

whether this proposal would increase

the likelihood of delinquent payments

by carriers, and thus a shortfall in the

fund. We invite comment on possible

administrative mechanisms to minimize

any such potential for delinquent

payments.

14. We seek comment on how to make

the transition from the existing

contribution assessment methodology to

a methodology based on current

revenues, if we were to adopt this

proposal for assessment of universal

service contributions. In particular, we

ask commenters to address when

assessments based on current revenues

should begin under the proposal, and

how to ‘‘close out’’ the assessment of

contributions under the existing

methodology. We also seek comment on

whether a one-time over-collection of

funds might be necessary to make the

transition to the proposed methodology,

and whether such an over-collection

would need to be maintained going

forward in order to safeguard fund

integrity.

15. Finally, we invite commenters,

especially small businesses, to discuss

any additional advantages,

disadvantages, or other implementation

issues presented by this proposed

contribution assessment methodology.

Commenters should indicate whether

the costs of implementing this proposal

outweigh the benefits and quantify such

claims, where possible. Furthermore, in

light of the issues presented by this

proposal, commenters should discuss

whether it would meet the requirements

of section 254 of the Act, including the

requirement that the Commission’s

universal service support mechanisms

be ‘‘specific, predictable, and

sufficient.’’

C. Universal Service Contribution

Assessment With a Shorter Interval

16. Under the existing assessment

methodology, the interval between the

accrual of revenues by carriers and the

assessment of universal service

contributions based on those revenues

ranges from 12 to 18 months. We seek

comment on a proposal to revise the

existing assessment methodology to

reduce this interval to three to six

months.

17. Under this proposal, carriers

would continue to file FCC Form 499A

annually as they are required to do

under the existing methodology.

Carriers would, however, begin to report

their revenues for each quarter by the

beginning of the second month of the

first following quarter. By the 20th day

of the second month of the first

following quarter, USAC would prepare

a quarterly contribution base for the

second following quarter. Finally, as it

does currently, the Commission would

release a proposed contribution factor

for the second following quarter in the

last month of the first following quarter.

Thus, for example, revenues for January

2001 through March 2001, namely for

1Q 2001, would be reported by May 1,

2001, the beginning of the second

month in 2Q 2001. USAC would

estimate a quarterly contribution base

using these 1Q 2001 revenues by May

20, 2001, the 20th day of the second

month in 2Q 2001. Finally, the

Commission would release a proposed

contribution factor for 3Q 2001, based

on 1Q 2001 revenues, at the beginning

of June 2001 (the last month of 2Q

2001).

18. Like the existing assessment

methodology, and unlike an assessment

methodology based on current revenues,

this proposal would assess

contributions against the same revenue

base used to calculate the contribution

factor. We seek comment on whether

this reduced interval between the

accrual of revenues and the assessment

of contributions would result in a

methodology that is competitively

neutral and ‘‘specific, predictable, and

sufficient,’’ consistent with section 254

of the Act. This methodology would

also reduce the interval between

revenue accrual and contribution

assessment from the current interval of

twelve to eighteen months to an interval

of three to six months. We seek

comment on whether this proposal

poses any concerns regarding universal

service fund integrity.

19. The shortened schedule under this

proposal would give USAC 20 days to

compile quarterly filing information and

estimate the contribution base. Parties

are asked to address whether this

schedule allows sufficient time for

USAC to perform these functions. In

particular, parties should address

whether carriers could file reliable

revenue information within 30 days of

the close of a quarter. USAC is asked to

comment on the extent to which this

schedule would increase the likelihood

of late filings, the extent to which data

would have to be estimated for late

filings, and the likelihood and size of

resulting over-collections or undercollections.

20. Under this proposal, carriers’

filings increase from two semi-annual

filings to one annual filing and four

quarterly filings, for a total of five

revenue filings per year. We seek

comment, especially from small

businesses, on whether the costs

associated with the increased reporting

requirements under this proposal

outweigh the benefits of the reduced

interval between revenue accrual and

contribution assessment. We also invite

commenters to address whether this

proposal should be offered as an

optional alternative to the current

assessment methodology, rather than as

a replacement for it. Commenters

should explain whether making this

proposal optional adequately addresses

concerns about the burden it would

impose. Commenters should also

address whether offering this proposal

as an option alongside the current

assessment methodology would result

in a methodology that is competitively

neutral and ‘‘specific, predictable, and

sufficient,’’ consistent with section 254

of the Act.

67326 Federal Register / Vol. 65, No. 218 / Thursday, November 9, 2000 / Proposed Rules

21. As with the first proposal

discussed, we seek comment on the

incentives carriers have under this

proposed methodology to report their

quarterly revenues in an accurate and

timely manner. In particular,

commenters should address whether

this proposal minimizes carriers’

incentives to underreport revenues for

the early quarters of a reporting year.

We also seek comment on whether

changes should be made to USAC’s

auditing abilities to ensure accurate

quarterly reporting. In addition, we

invite comment on possible

administrative mechanisms that might

be implemented to ensure accurate

reporting of quarterly revenues,

including the use of penalties. We also

ask commenters to address whether

such a methodology would increase the

likelihood of delinquent payments by

carriers, and thus a shortfall in the fund.

We seek comment on possible

administrative mechanisms that might

be implemented to minimize any such

potential for delinquent payments,

including the use of penalties.

22. We also seek comment on how to

make the transition from the existing

assessment methodology to the proposal

discussed here. In particular, we ask

commenters to address when

assessments based on quarterly

revenues should begin under the

proposal, and how to ‘‘close out’’ the

assessment of contributions under the

existing methodology. We also seek

comment on whether a one-time overcollection of funds might be necessary

to make the transition to the proposed

methodology. In addition, we ask

commenters to address how to make the

transition from the existing

methodology to the proposal discussed

here if that proposal is made optional.

23. Finally, we invite commenters,

especially small businesses, to discuss

any additional advantages,

disadvantages, or other implementation

issues presented by this proposed

contribution methodology. Commenters

should indicate whether the costs of

implementing this proposal outweigh

the benefits and quantify such claims,

where possible. Furthermore,

commenters should discuss whether it

would meet the requirements of section

254 of the Act, including the

requirements that the Commission’s

universal service support mechanisms

be ‘‘equitable and nondiscriminatory’’

and ‘‘specific, predictable, and

sufficient.’’

D. Other Proposed Universal Service

Contribution Assessment Methodologies

24. In addition to the two proposals

discussed, we invite commenters,

especially small businesses, to suggest

other alternative assessment

methodologies. For example, some

parties have suggested the use of a

contribution methodology that requires

carriers to recover their contributions

through a fixed-percentage end-user

surcharge. We invite commenters to

address the legal and policy issues

associated with such an approach.

Specifically, we encourage commenters

to address the extent to which

consumers will benefit from such an

approach. Commenters should explain

the operation of this alternative, or any

other alternative, including a plan for

transition from the existing

methodology to the proposed

alternative.

25. We ask commenters offering

alternative proposals to address the

following questions in detail. (1) Is the

proposed alternative consistent with the

requirements of section 254 of the Act,

including the requirements that the

Commission’s universal service support

mechanisms be ‘‘equitable and

nondiscriminatory’’ and ‘‘specific,

predictable, and sufficient?’’ (2) Does

the alternative protect the integrity of

the universal service fund, in particular

by guarding against a shortfall in the

fund? (3) To the extent there are

concerns about the competitive

neutrality of the universal service

assessment methodology, does the

alternative address these concerns, and

is it more competitively neutral than the

current methodology and other

proposed methodologies? (4) Does the

alternative minimize burdens, including

recordkeeping and reporting

requirements, on carriers? (5) How

should the alternative be implemented,

and how should the Commission

transition from the existing contribution

assessment methodology to the

alternative? (6) Finally, what are the

advantages and disadvantages of any

such alternative (quantifying the

associated costs and benefits where

appropriate)?

III. Procedural Matters

A. Ex Parte

26. This is a non-restricted notice and

comment rulemaking proceeding. Ex

parte presentations are permitted,

except during the Sunshine Agenda

period, provided they are disclosed as

provided in the Commission’s rules.

B. Initial Paperwork Reduction Act of

1995 Analysis

27. This FNPRM contains either a

proposed or modified information

collection. As part of a continuing effort

to reduce paperwork burdens, we invite

the general public and the Office of

Management and Budget (OMB) to take

this opportunity to comment on the

information collections contained in

this FNPRM, as required by the

Paperwork Reduction Act of 1995,

Public Law 104–13. Public and agency

comments are due at the same time as

other comments on this FNPRM; OMB

comments are due 60 days from the date

of publication of this FNPRM in the

Federal Register. Comments should

address: (a) Whether the proposed

collection of information is necessary

for the proper performance of the

functions of the Commission, including

whether the information shall have

practical utility; (b) the accuracy of the

Commission’s burden estimates; (c)

ways to enhance the quality, utility, and

clarity of the information collected; and

(d) ways to minimize the burden of the

collection of information on the

respondents, including the use of

automated collection techniques or

other forms of information technology.

C. Initial Regulatory Flexibility Analysis

28. As required by the Regulatory

Flexibility Act (RFA), the Commission

has prepared this Initial Regulatory

Flexibility Analysis (IRFA) of the

possible significant economic impact on

small entities by the policies and rules

proposed in this Further Notice of

Proposed Rulemaking. Written public

comments are requested on this IRFA.

Comments must be identified as

responses to the IRFA and must be filed

by the deadlines for comments on the

FNPRM provided below. The

Commission will send a copy of the

FNPRM, including this IRFA, to the

Chief Counsel for Advocacy of the Small

Business Administration (SBA). In

addition, the FNPRM and IRFA (or

summaries thereof) will be published in

the Federal Register.

1. Need for, and Objectives of, the

Proposed Rules

29. The Telecommunications Act of

1996 requires that ‘‘[e]very

telecommunications carrier that

provides interstate telecommunications

services shall contribute, on an

equitable and nondiscriminatory basis,

to the specific, predictable, and

sufficient mechanisms established by

the Commission to preserve and

advance universal service.’’ This

FNPRM addresses issues of the

methodology that should be used to

assess carriers’ contributions to the

universal service support mechanisms.

We desire to adopt rules for an

assessment methodology that best meets

the statute’s requirements that

contributions be equitable and

Federal Register / Vol. 65, No. 218 / Thursday, November 9, 2000 / Proposed Rules 67327

nondiscriminatory and that the

universal service support mechanisms

be specific, predictable, and sufficient.

We also seek, wherever possible, to

minimize the regulatory burden on

affected parties.

2. Legal Basis

30. The legal basis as proposed for

this FNPRM is contained in section 254

of the Communications Act of 1934, as

amended by the Telecommunications

Act of 1996, 47 U.S.C. 254.

3. Description and Estimate of the

Number of Small Entities to Which the

Proposed Rules Will Apply

31. The Commission’s contributor

reporting requirements apply to a wide

range of entities, including all

telecommunications carriers and other

providers of interstate

telecommunications services that offer

telecommunications services for a fee.

Thus, we expect that the rules adopted

in this proceeding could have a

significant economic impact on a

substantial number of small entities. Of

the estimated 5,000 filers of the

Telecommunications Reporting

Worksheet, FCC Form 499, we do not

know how many are small entities, but

we offer below a detailed estimate of the

number of small entities within each of

several major carrier-type categories.

32. To estimate the number of small

entities that would be affected by this

economic impact, we first consider the

statutory definition of ‘‘small entity’’

under the RFA. The RFA generally

defines ‘‘small entity’’ as having the

same meaning as the term ‘‘small

business,’’ ‘‘small organization,’’ and

‘‘small governmental jurisdiction.’’ In

addition, the term ‘‘small business’’ has

the same meaning as the term ‘‘small

business concern’’ under the Small

Business Act, unless the Commission

has developed one or more definitions

that are appropriate to its activities.

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 SBA. The SBA has

defined a small business for Standard

Industrial Classification (SIC) categories

4812 (Radiotelephone Communications)

and 4813 (Telephone Communications,

Except Radiotelephone) to be small

entities when they have no more than

1,500 employees. We first discuss the

number of small telephone companies

falling within these SIC categories, then

attempt to refine further those estimates

to correspond with the categories of

telephone companies that are commonly

used under our rules.

33. The most reliable source of

information regarding the total numbers

of certain common carrier and related

providers nationwide, as well as the

numbers of commercial wireless

entities, appears to be data the

Commission publishes annually in its

Carrier Locator report, derived from

filings made in connection with the

Telecommunications Relay Service

(TRS). According to data in the most

recent report, there are 4,144 interstate

carriers. These carriers include, inter

alia, incumbent local exchange carriers,

competitive local exchange carriers,

competitive access providers,

interexchange carriers, other wireline

carriers and service providers (including

shared-tenant service providers and

private carriers), operator service

providers, pay telephone operators,

providers of telephone toll service,

wireless carriers and services providers,

and resellers.

34. We have included small

incumbent local exchange carriers

(LECs) in this present RFA analysis. As

noted, a ‘‘small business’’ under the

RFA is one that, inter alia, meets the

pertinent small business size standard

(e.g., a telephone communications

business having 1,500 or fewer

employees), and ‘‘is not dominant in its

field of operation.’’ The SBA’s Office of

Advocacy contends that, for RFA

purposes, small incumbent LECs are not

dominant in their field of operation

because any such dominance is not

‘‘national’’ in scope. We have therefore

included small incumbent LECs in this

RFA analysis, although we emphasize

that this RFA action has no effect on

FCC analyses and determinations in

other, non-RFA contexts.

35. Total Number of Telephone

Companies Affected. The United States

Bureau of the Census (the Census

Bureau) reports that, at the end of 1992,

there were 3,497 firms engaged in

providing telephone services, as defined

therein, for at least one year. This

number contains a variety of different

categories of carriers, including local

exchange carriers, interexchange

carriers, competitive access providers,

cellular carriers, mobile service carriers,

operator service providers, pay

telephone operators, PCS providers,

covered SMR providers, and resellers. It

seems certain that some of those 3,497

telephone service firms may not qualify

as small entities or small incumbent

LECs because they are not

‘‘independently owned and operated.’’

For example, a PCS provider that is

affiliated with an interexchange carrier

having more than 1,500 employees

would not meet the definition of a small

business. It seems reasonable to

conclude, therefore, that fewer than

3,497 telephone service firms are small

entity telephone service firms or small

incumbent LECs that may be affected by

the decisions and rule changes adopted

in this proceeding.

36. Wireline Carriers and Service

Providers. The SBA has developed a

definition of small entities for telephone

communications companies other than

radiotelephone companies. The Census

Bureau reports that, there were 2,321

such telephone companies in operation

for at least one year at the end of 1992.

According to the SBA’s definition, a

small business telephone company

other than a radiotelephone company is

one employing no more than 1,500

persons. All but 26 of the 2,321 nonradiotelephone companies listed by the

Census Bureau were reported to have

fewer than 1,000 employees. Thus, even

if all 26 of those companies had more

than 1,500 employees, there would still

be 2,295 non-radiotelephone companies

that might qualify as small entities or

small incumbent LECs. Although it

seems certain that some of these carriers

are not independently owned and

operated, we are unable at this time to

estimate with greater precision the

number of wireline carriers and service

providers that would qualify as small

business concerns under the SBA’s

definition. Consequently, we estimate

that there are fewer than 2,295 small

entity telephone communications

companies other than radiotelephone

companies that may be affected by the

decisions and rule changes adopted in

this proceeding.

37. Local Exchange Carriers,

Interexchange Carriers, Competitive

Access Providers, Operator Service

Providers, and Resellers. Neither the

Commission nor the SBA has developed

a definition particular to small LECs,

interexchange carriers (IXCs),

competitive access providers (CAPs),

operator service providers (OSPs), or

resellers. The closest applicable

definition for these carrier-types under

the SBA rules is for telephone

communications companies other than

radiotelephone (wireless) companies.

The most reliable source of information

regarding the number of these carriers

nationwide of which we are aware

appears to be the data that we collect

annually in connection with the

Telecommunications Relay Service.

According to our most recent data, there

are 1,348 incumbent LECs, 212 CAPs

and competitive LECs, 171 IXCs, 24

OSPs, 388 toll resellers, and 54 local

resellers. Although it seems certain that

some of these carriers are not

independently owned and operated, or

have more than 1,500 employees, we are

67328 Federal Register / Vol. 65, No. 218 / Thursday, November 9, 2000 / Proposed Rules

unable at this time to estimate with

greater precision the number of these

carriers that would qualify as small

business concerns under the SBA’s

definition. Consequently, we estimate

that there are fewer than 1,348

incumbent LECs, 212 CAPs and

competitive LECs, 171 IXCs, 24 OSPs,

388 toll resellers, and 54 local resellers

that may be affected by the decisions

and rule changes adopted in this

proceeding.

38. Wireless (Radiotelephone)

Carriers. The SBA has developed a

definition of small entities for

radiotelephone (wireless) companies.

The Census Bureau reports that there

were 1,176 such companies in operation

for at least one year at the end of 1992.

According to the SBA’s definition, a

small business radiotelephone company

is one employing no more than 1,500

persons. The Census Bureau also

reported that 1,164 of those

radiotelephone companies had fewer

than 1,000 employees. Thus, even if all

of the remaining 12 companies had

more than 1,500 employees, there

would still be 1,164 radiotelephone

companies that might qualify as small

entities if they are independently owned

and operated. Although it seems certain

that some of these carriers are not

independently owned and operated, we

are unable at this time to estimate with

greater precision the number of

radiotelephone carriers and service

providers that would qualify as small

business concerns under the SBA’s

definition. Consequently, we estimate

that there are fewer than 1,164 small

entity radiotelephone companies that

may be affected by the decisions and

rule changes adopted in this proceeding.

39. Cellular, PCS, SMR, and Other

Mobile Service Providers. In an effort to

further refine our calculation of the

number of radiotelephone companies

that may be affected by the rules

adopted herein, we consider the data

that we collect annually in connection

with the TRS for the subcategories

Wireless Telephony (which includes

Cellular, PCS, and SMR) and Other

Mobile Service Providers. Neither the

Commission nor the SBA has developed

a definition of small entities specifically

applicable to these broad subcategories,

so we will utilize the closest applicable

definition under the SBA rules—which,

for both categories, is for telephone

companies other than radiotelephone

(wireless) companies. To the extent that

the Commission has adopted definitions

for small entities providing PCS and

SMR services, we discuss those

definitions below. According to our

most recent TRS data, 808 companies

reported that they are engaged in the

provision of Wireless Telephony

services and 23 companies reported that

they are engaged in the provision of

Other Mobile Services. Although it

seems certain that some of these carriers

are not independently owned and

operated, or have more than 1,500

employees, we are unable at this time to

estimate with greater precision the

number of Wireless Telephony

Providers and Other Mobile Service

Providers, except as described below,

that would qualify as small business

concerns under the SBA’s definition.

Consequently, we estimate that there are

fewer than 808 small entity Wireless

Telephony Providers and fewer than 23

small entity Other Mobile Service

Providers that might be affected by the

decisions and rule changes adopted in

this proceeding.

40. Broadband PCS Licensees. The

broadband PCS spectrum is divided into

six frequency blocks designated A

through F, and the Commission has held

auctions for each block. The

Commission defined ‘‘small entity’’ for

Blocks C and F as an entity that has

average gross revenues of less than $40

million in the three previous calendar

years. For Block F, an additional

classification for ‘‘very small business’’

was added, and is defined as an entity

that, together with its affiliates, has

average gross revenues of not more than

$15 million for the preceding three

calendar years. These regulations

defining ‘‘small entity’’ in the context of

broadband PCS auctions have been

approved by the SBA. No small

businesses within the SBA-approved

definition bid successfully for licenses

in Blocks A and B. There were 90

winning bidders that qualified as small

entities in the Block C auctions. A total

of 93 small and very small business

bidders won approximately 40% of the

1,479 licenses for Blocks D, E, and F.

However, licenses for Blocks C through

F have not been awarded fully, therefore

there are few, if any, small businesses

currently providing PCS services. Based

on this information, we estimate that the

number of small broadband PCS

licenses will include the 90 winning C

Block bidders and the 93 qualifying

bidders in the D, E, and F blocks, for a

total of at least 183 small PCS providers

as defined by the SBA and the

Commissioner’s auction rules.

41. SMR Licensees. Pursuant to

§ 90.814(b)(1) of the Commission’s rules,

the Commission has defined ‘‘small

entity’’ in auctions for geographic area

800 MHz and 900 MHz SMR licenses as

a firm that had average annual gross

revenues of less than $15 million in the

three previous calendar years. The

definition of a ‘‘small entity’’ in the

context of both 800 MHz and 900 MHz

SMR has been approved by the SBA.

Any rules proposed in this proceeding

may apply to SMR providers in the 800

MHz and 900 MHz bands that either

hold geographic area licenses or have

obtained extended implementation

authorizations. We do not know how

many firms provide 800 MHz or 900

MHz geographic area SMR service

pursuant to extended implementation

authorizations, nor how many of these

providers have annual revenues of less

than $15 million. We assume, for

purposes of this IRFA, that all of the

extended implementation

authorizations may be held by small

entities, that may be affected by the

decisions and rule changes adopted in

this proceeding.

42. The Commission recently held

auctions for geographic area licenses in

the 900 MHz SMR band. There were 60

winning bidders who qualified as small

entities in the 900 MHz auction. Based

on this information, we conclude that

the number of geographic area SMR

licensees that may be affected by the

decisions and rule changes adopted in

this Order includes these 60 small

entities. No auctions have been held for

800 MHz geographic area SMR licenses.

Therefore, no small entities currently

hold these licenses. A total of 525

licenses will be awarded for the upper

200 channels in the 800 MHz

geographic area SMR auction. The

Commission, however, has not yet

determined how many licenses will be

awarded for the lower 230 channels in

the 800 MHz geographic area SMR

auction. There is no basis, moreover, on

which to estimate how many small

entities will win these licenses. Given

that nearly all radiotelephone

companies have fewer than 1,000

employees and that no reliable estimate

of the number of prospective 800 MHz

licensees can be made, we assume, for

purposes of this IRFA, that all of the

licenses may be awarded to small

entities who may be affected by the

decisions and rule changes adopted in

this proceeding.

43. 220 MHz Radio Service—Phase I

Licensees. The 220 MHz service has

both Phase I and Phase II licenses. There

are approximately 1,515 such nonnationwide licensees and four

nationwide licensees currently

authorized to operate in the 220 MHz

band. The Commission has not

developed a definition of small entities

specifically applicable to such

incumbent 220 MHz Phase I licensees.

To estimate the number of such

licensees that are small businesses, we

apply the definition under the SBA

rules applicable to radiotelephone

Federal Register / Vol. 65, No. 218 / Thursday, November 9, 2000 / Proposed Rules 67329

communications companies. According

to the Census Bureau, only 12

radiotelephone firms out of a total of

1,178 such firms which operated during

1992 had 1,000 or more employees.

Therefore, if this general ratio continues

to 2000 in the context of Phase I 220

MHz licensees, we estimate that nearly

all such licensees are small businesses

under the SBA’s definition.

44. 220 MHz Radio Service—Phase II

Licensees. The Phase II 220 MHz service

is a new service, and is subject to

spectrum auctions. In the 220 MHz

Third Report and Order, 62 FR 16004

(April 3, 1997), this Commission

adopted criteria for defining small

businesses and very small businesses for

purposes of determining their eligibility

for special provisions such as bidding

credits and installment payments. We

have defined a small business as an

entity that, together with its affiliates

and controlling principals, has average

gross revenues not exceeding $15

million for the preceding three years.

Additionally, a very small business is

defined as an entity that, together with

its affiliates and controlling principals,

has average gross revenues that are not

more than $3 million for the preceding

three years. An auction of Phase II

licenses commenced on September 15,

1998, and closed on October 22, 1998.

908 licenses were auctioned in 3

different-sized geographic areas: three

nationwide licenses, 30 Regional

Economic Area Group Licenses, and 875

Economic Area (EA) Licenses. Of the

908 licenses auctioned, 693 were sold.

Companies claiming small business

status won: one of the Nationwide

licenses, 67% of the Regional licenses,

and 54% of the EA licenses. As of

January 22, 1999, the Commission

announced that it was prepared to grant

654 of the Phase II licenses won at

auction.

45. Paging. The Commission has

proposed a two-tier definition of small

businesses in the context of auctioning

licenses in the Common Carrier Paging

and exclusive Private Carrier Paging

services. Under the proposal, a small

business will be defined as either (1) an

entity that, together with its affiliates

and controlling principals, has average

gross revenues for the three preceding

years of not more than $3 million, or (2)

an entity that, together with affiliates

and controlling principals, has average

gross revenues for the three preceding

calendar years of not more than $15

million. Because the SBA has not yet

approved this definition for paging

services, we will utilize the SBA’s

definition applicable to radiotelephone

companies, i.e., an entity employing no

more than 1,500 persons. At present,

there are approximately 24,000 Private

Paging licenses and 74,000 Common

Carrier Paging licenses. According to the

most recent Carrier Locator data, 303

carriers reported that they were engaged

in the provision of either paging or

messaging services, which are placed

together in the data. We do not have

data specifying the number of these

carriers that are not independently

owned and operated or have more than

1,500 employees, and thus are unable at

this time to estimate with greater

precision the number of paging carriers

that would qualify as small business

concerns under the SBA’s definition.

Consequently, we estimate that there are

fewer than 303 small paging carriers

that may be affected by the decisions

and rule changes under consideration in

this proceeding. We estimate that the

majority of private and common carrier

paging providers would qualify as small

entities under the SBA definition.

46. Narrowband PCS. The

Commission has auctioned nationwide

and regional licenses for narrowband

PCS. There are 11 nationwide and 30

regional licensees for narrowband PCS.

The Commission does not have

sufficient information to determine

whether any of these licensees are small

businesses within the SBA-approved

definition for radiotelephone

companies. At present, there have been

no auctions held for the major trading

area (MTA) and basic trading area (BTA)

narrowband PCS licenses. The

Commission anticipates a total of 561

MTA licenses and 2,958 BTA licenses

will be awarded by auction. Such

auctions have not yet been scheduled,

however. Given that nearly all

radiotelephone companies have no more

than 1,500 employees and that no

reliable estimate of the number of

prospective MTA and BTA narrowband

licensees can be made, we assume, for

purposes of this IRFA, that all of the

licenses will be awarded to small

entities, as that term is defined by the

SBA.

47. Rural Radiotelephone Service. The

Commission has not adopted a

definition of small entity specific to the

Rural Radiotelephone Service. A

significant subset of the Rural

Radiotelephone Service is the Basic

Exchange Telephone Radio Systems

(BETRS). We will use the SBA’s

definition applicable to radiotelephone

companies, i.e., an entity employing no

more than 1,500 persons. There are

approximately 1,000 licensees in the

Rural Radiotelephone Service, and we

estimate that almost all of them qualify

as small entities under the SBA’s

definition.

48. Air-Ground Radiotelephone

Service. The Commission has not

adopted a definition of small entity

specific to the Air-Ground

Radiotelephone Service. Accordingly,

we will use the SBA’s definition

applicable to radiotelephone companies,

i.e., an entity employing no more than

1,500 persons. There are approximately

100 licensees in the Air-Ground

Radiotelephone Service, and we

estimate that almost all of them qualify

as small entities under the SBA

definition.

49. Private Land Mobile Radio

(PLMR). PLMR systems serve an

essential role in a range of industrial,

business, land transportation, and

public safety activities. These radios are

used by companies of all sizes operating

in all U.S. business categories. The

Commission has not developed a

definition of small entity specifically

applicable to PLMR licensees due to the

vast array of PLMR users. For the

purpose of determining whether a

licensee is a small business as defined

by the SBA, each licensee would need

to be evaluated within its own business

area.

50. The Commission is unable at this

time to estimate the number of, if any,

small businesses which could be

impacted by the rules. However, the

Commission’s 1994 Annual Report on

PLMRs indicates that at the end of fiscal

year 1994 there were 1,087,267

licensees operating 12,481,989

transmitters in the PLMR bands below

512 MHz. Because any entity engaged in

a commercial activity is eligible to hold

a PLMR license, the proposed rules in

this context could potentially impact

every small business in the United

States.

51. Fixed Microwave Services.

Microwave services include common

carrier, private-operational fixed, and

broadcast auxiliary radio services. At

present, there are approximately 22,015

common carrier fixed licensees in the

microwave services. The Commission

has not yet defined a small business

with respect to microwave services. For

purposes of this IRFA, we will utilize

the SBA’s definition applicable to

radiotelephone companies—i.e., an

entity with no more than 1,500 persons.

We estimate, for this purpose, that all of

the Fixed Microwave licensees

(excluding broadcast auxiliary

licensees) would qualify as small

entities under the SBA definition for

radiotelephone companies.

52. Offshore Radiotelephone Service.

This service operates on several UHF

TV broadcast channels that are not used

for TV broadcasting in the coastal area

of the states bordering the Gulf of

67330 Federal Register / Vol. 65, No. 218 / Thursday, November 9, 2000 / Proposed Rules

Mexico. At present, there are

approximately 55 licensees in this

service. We are unable at this time to

estimate the number of licensees that

would qualify as small entities under

the SBA’s definition for radiotelephone

communications.

53. Wireless Communications

Services. This service can be used for

fixed, mobile, radio location and digital

audio broadcasting satellite uses. The

Commission defined ‘‘small business’’

for the wireless communications

services (WCS) auction as an entity with

average gross revenues of $40 million

for each of the three preceding years,

and a ‘‘very small business’’ as an entity

with average gross revenues of $15

million for each of the three preceding

years. The Commission auctioned

geographic area licenses in the WCS

service. In the auction, there were seven

winning bidders that qualified as very

small business entities, and one that

qualified as a small business entity. We

conclude that the number of geographic

area WCS licensees that may be affected

by the decisions and rule changes under

consideration in this proceeding

includes these eight entities.

4. Description of Projected Reporting,

Recordkeeping, and Other Compliance

Requirements

54. As currently structured,

telecommunications carriers and other

service providers having interstate

revenues are required to file

semiannually the Telecommunications

Reporting Worksheet, which includes

their reporting of end-user

telecommunications revenues for

purposes of the federal universal service

support mechanisms. Any decisions or

rule changes adopted in this proceeding

carry the potential to increase the

reporting and recordkeeping

requirements on telecommunications

service providers regulated under the

Communications Act. For example, two

of the possible alternatives to the

current universal service contribution

assessment methodology discussed, (1)

basing universal service contributions

on current year revenues and (2)

reducing the time period between

accrual of revenues and the assessment

of universal service contributions based

on those revenues, would entail

additional monthly or quarterly

reporting of end-user

telecommunications revenues. Any such

additional reporting requirements could

potentially require the use of

professional skills, including legal and

accounting expertise. At this point, until

we receive more data, we are unable to

estimate the costs of compliance with

these or other possible universal service

assessment methodologies upon small

telecommunications service providers

that might be affected by any of the

proposals discussed in the FNPRM.

Entities, especially small businesses, are

encouraged to file comments identifying

and quantifying the costs of the two

contribution assessment methodologies

proposed and any other alternative

methodologies during this proceeding.

5. Steps Taken To Minimize Significant

Economic Impact on Small Entities, and

Significant Alternatives Considered

55. 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.

56. To minimize the significant

economic impact on carriers, including

carriers which are small entities, this

FNPRM proposes two alternative

contribution assessment methodologies:

(1) Basing contributions on current year

revenues and (2) reducing the time

period between accrual of revenues and

the assessment of universal service

contributions based on those revenues.

These two alternatives impose different

revenue reporting requirements. For

example, the current year methodology

proposed would require carriers to

submit reports of their current revenues

regularly in addition to the semiannual

reports already required of revenues

from the prior year in Forms 499A and

499S. The other methodology proposed,

however, would increase filing burdens

to a lesser degree, requiring quarterly

reporting of revenue data and the

annual filing of the Form 499A. These

alternatives would require the same

reporting requirements for both large

and small entities. Therefore, this

Notice also seeks comment on other

alternative contribution assessment

methodologies that might minimize

recordkeeping and reporting burdens on

carriers, including small entities. The

final alternative may be to leave the

current contribution assessment

methodology in place. This alternative

will depend on the record developed in

this proceeding.

6. Federal Rules that May Duplicate,

Overlap, or Conflict With the Proposed

Rules

57. None.

D. Comment Dates and Filing

Procedures

58. We invite comment on the issues

and questions set forth. Pursuant to

applicable procedures set forth in

§§ 1.415 and 1.419 of the Commission’s

rules, interested parties may file

comments as follows: comments are due

November 30, 2000 and reply comments

are due December 14, 2000. Comments

may be filed using the Commission’s

Electronic Comment Filing System

(ECFS) or by filing paper copies. See

Electronic Filing of Documents in

Rulemaking Proceedings, 63 FR 24121,

May 1, 1998.

59. Comments filed through the ECFS

can be sent as an electronic file via the

Internet to <http://www.fcc.gov/e-file/

ecfs.html>. Generally, only one copy of

an electronic submission must be filed.

If multiple docket or rulemaking

numbers appear in the caption of this

proceeding, however, commenters must

transmit one electronic copy of the

comments to each docket or rulemaking

number referenced in the caption. In

completing the transmittal screen,

commenters should include their full

name, Postal Service mailing address,

and the applicable docket or rulemaking

number. Parties may also submit

electronic comments by Internet e-mail.

To receive filing instructions for e-mail

comments, commenters should send an

e-mail to ecfs@fcc.gov, and should

include the following words in the body

of the message, ‘‘get form <your e-mail

address>.’’ A sample form and

directions will be sent in reply.

60. Parties who choose to file by

paper must file an original and four

copies of each filing. If more than one

docket or rulemaking number appears in

the caption of this proceeding,

commenters must submit two additional

copies for each additional docket or

rulemaking number. All filings must be

sent to the Commission’s Secretary,

Magalie Roman Salas, Office of the

Secretary, Federal Communications

Commission, 445 12th Street, SW.,

Washington, DC 20554. Parties also

should send three paper copies of their

filing to Sheryl Todd, Accounting Policy

Division, Common Carrier Bureau,

Federal Communications Commission,

445 Twelfth Street, SW., Room 5–B540,

Washington, DC 20554.

61. Parties who choose to file by

paper should also submit their

comments on diskette to Sheryl Todd,

Accounting Policy Division, Common

Federal Register / Vol. 65, No. 218 / Thursday, November 9, 2000 / Proposed Rules 67331

Carrier Bureau, Federal

Communications Commission, 445

Twelfth Street, SW., Room 5–B540,

Washington, DC 20554. Such a

submission should be on a 3.5 inch

diskette formatted in an IBM-compatible

format using Microsoft Word 97 for

Windows or a compatible software. The

diskette should be accompanied by a

cover letter and should be submitted in

‘‘read-only’’ mode. The diskette should

be clearly labeled with the commenter’s

name, proceeding, including the lead

docket number in the proceeding (CC

Docket No. 96–45), type of pleading

(comment or reply comment), date of

submission, and the name of the

electronic file on the diskette. The label

should also include the following

phrase (‘‘Disk Copy Not an Original.’’)

Each diskette should contain only one

party’s pleadings, preferably in a single

electronic file. In addition, commenters

must send diskette copies to the

Commission’s copy contractor,

International Transcription Service,

Inc., 1231 20th Street, NW.,

Washington, DC 20037.

62. Written comments by the public

on the proposed and/or modified

information collections discussed in

this FNPRM are due November 30,

2000. Written comments must be

submitted by the Office of Management

and Budget (OMB) on the proposed and/

or modified information collections on

or before January 8, 2001. In addition to

filing comments with the Secretary, a

copy of any comments on the

information collection(s) contained

herein should be submitted to Judy

Boley, Federal Communications

Commission, Room 1–C804, 445 12th

Street, SW., Washington, DC 20554, or

via the Internet to jboley@fcc.gov and to

Edward C. Springer, OMB Desk Officer,

10236 NEOB, 725 17th Street, NW.,

Washington, DC 20503, or via the

Internet to vhuth@omb.eop.gov.

IV. Ordering Clauses

63. Pursuant to the authority

contained in sections 1, 4(i), 4(j), 254,

and 403, of the Communications Act of

1934, as amended, that this Further

Notice of Proposed Rulemaking is

adopted, that Comments are Requested

as described, and that Notice is Hereby

Given of proposed amendments to parts

54 of the Commission’s rules, as

described in this Further Notice of

Proposed Rulemaking.

64. The Commission’s Consumer

Information Bureau, Reference

Information Center, shall send a copy of

this Further Notice of Proposed

Rulemaking, including the Initial

Regulatory Flexibility Analysis, to the

Chief Counsel for Advocacy of the Small

Business Administration.

Federal Communications Commission.

Magalie Roman Salas,

Secretary.

[FR Doc. 00–28728 Filed 11–8–00; 8:45 am]

BILLING CODE 6712–01–P

FEDERAL COMMUNICATIONS

COMMISSION

47 CFR Part 73

[MM Docket No. 00–44; FCC 00–343]

Extension of the Filing Requirement

for Children’s Television Programming

Reports (FCC Form 398)

AGENCY: Federal Communications

Commission.

ACTION: Proposed rule.

SUMMARY: This document seeks

comment on the tentative conclusion

that broadcasters who maintain internet

websites should be required to post

their completed quarterly Children’s

Television Programming Reports (FCC

Form 398) on these sites. The FCC 398

is required to be filed by commercial

television broadcast stations each

quarter. This form is used to provide

information on the efforts of commercial

television stations to provide children’s

educational and informational programs

aired to meet its obligation under the

Children’s Television Act of 1990

(CTA). Although the Children’s

Television Programming Reports are

available in a central location on the

FCC’s website, members of the public

may look first to their local broadcast

station for information about

programming at the station, making

station website posting useful.

DATES: Comments must be filed on or

before December 18, 2000; reply

comments must be filed on or before

January 17, 2001. Written comments by

the public on the proposed information

collections are due on or before

December 18, 2000. Written comments

must be submitted by the Office of

Management and Budget (PMB) on the

proposed information collection(s) on or

before January 8, 2001.

FOR FURTHER INFORMATION CONTACT: Kim

Matthews, Policy and Rules Division,

Mass Media Bureau, at (202) 418–2130,

TTY (202) 418–2989. For additional

information concerning the information

collection(s) contained in this

document, contact Judy Boley at 202–

418–0214, or via the Internet at

jboley@fcc.gov.

SUPPLEMENTARY INFORMATION: This is a

summary of the Further Notice of

Proposed Rule Making (‘‘FNPRM’’) in

MM Docket No. 00–44, FCC 00–343,

adopted on September 14, 2000, and

released on October 5, 2000. The full

text of this decision is available for

inspection and copying during regular

business hours in the FCC Reference

Center, 445 Twelfth Street, SW, Room

CY–A257, Washington DC, and also

may be purchased from the

Commission’s copy contractor,

International Transcription Service,

(202) 857–3800, 445 Twelfth Street, SW,

Room CY–B402, Washington DC. The

complete text is also available under the

file name fcc00343.pdf on the

Commission’s Internet site at

www.fcc.gov.

This document contains proposed

information collection(s) subject to the

Paperwork Reduction Act of 1995

(PRA). The general public and other

Federal agencies are invited to comment

on the proposed information collections

contained in this proceeding.

Electronic Access and Filing Addresses

Comments may be filed using the

Commission’s Electronic Comment

Filing System (ECFS) or by filing paper

copies via the Internet to http://

www.fcc.gov/e-file/ecfs.html. Parties

may also submit an electronic comment

by Internet e-mail. To get filing

instructions for e-mail comments,

commenters should send an e-mail to

ecfs@fcc.gov,, and should include the

following words in the body of the

message, ‘‘get form, <your e-mail

address>.’’ A sample form and

directions will be sent in reply.

Paperwork Reduction Act

This document contains a proposed

information collection. The

Commission, as part of its continuing

effort to reduce paperwork burdens,

invites the general public and the Office

of Management and Budget (OMB) to

comment on the information

collection(s) contained in the FNPRM,

as required by the Paperwork Reduction

Act of 1995, Public Law 104–13. Public

and agency comments are due at the

same time as other comments on this

FNPRM; OMB comments are due

January 8, 2001. Comments should

address (a) whether the proposed

collection of information is necessary

for the proper performance of the

functions of the Commission, including

whether the information shall have

practical utility; (b) ways to enhance the

quality, utility, and clarity of the

information collected; (c) ways to

minimize the burden of the collection of

information on the respondents,

including the use of automated