11638 Federal Register / Vol. 62, No. 48 / Wednesday, March 12, 1997 / Proposed Rules

FEDERAL COMMUNICATIONS

COMMISSION

47 CFR Parts 22 and 90

[WT Docket No. 96–18; PP Docket No. 93–

253; FCC 97–59]

Facilitate Future Development of

Paging Systems and Implementation of

Section 309(j) of the Communications

Act—Competitive Bidding

AGENCY: Federal Communications

Commission.

ACTION: Notice of proposed rulemaking.

SUMMARY: In this Further Notice of

Proposed Rulemaking (FNPRM), in WT

Docket No. 96–18 and PP Docket No.

93–253, the Commission seeks comment

on coverage requirements for

nationwide geographic area licenses,

partitioning and disaggregation for

geographic area paging licenses

(including nationwide licenses), and the

application procedure for the shared

channels. The Commission seeks to

eliminate or reduce paging license

application fraud by providing

applicants with information about the

risks of telecommunications investment

and the warning signs of possible

investment fraud. The Commission’s

objective is to provide paging licensees

the flexibility they need to tailor their

service offerings to meet market

demands and facilitate greater

participation by small businesses.

DATES: Comments must be filed on or

before April 17, 1997. Reply comments

are to be filed on or before May 1, 1997.

ADDRESSES: Federal Communications

Commission, 1919 M Street, NW.,

Washington, DC 20554.

FOR FURTHER INFORMATION CONTACT:

Mika Savir, Commercial Wireless

Division, Wireless Telecommunications

Bureau, at (202) 418–0620, or Frank

Stilwell, Auctions Division, Wireless

Telecommunications Bureau, at (202)

418–0660.

SUPPLEMENTARY INFORMATION: This

Further Notice of Proposed Rulemaking

in WT Docket No. 96–18 and PP Docket

No. 93–253, adopted on February 19,

1997 and released on February 24, 1997,

is available for inspection and copying

during normal business hours in the

FCC Reference Center, Room 239, 1919

M Street, NW., Washington, DC 20554.

The complete text may also be

purchased from the Commission’s copy

contractor, International Transcription

Service, Inc., 2100 M Street, NW., Suite

140, Washington, DC 20037, (202) 857–

3800.

Synopsis of the Further Notice of

Proposed Rulemaking

I. Background

1. In the Second Report and Order in

WT Docket No. 96–18, the Commission

adopted rules governing geographic area

licensing for paging licenses and

competitive bidding procedures for

auctioning mutually exclusive

applications for these licenses. Further

comment is needed on several issues

such as coverage requirements for

nationwide geographic area licenses,

partitioning and disaggregation for

geographic area licenses, and possible

modifications to the application

procedure for shared channels.

II. Further Notice of Proposed

Rulemaking

A. Nationwide Channels

2. In the Second Report and Order in

WT Docket No. 96–18, the Commission

concluded that the three nationwide 931

MHz channels and twenty-three 929

MHz PCP nationwide channels will not

be subject to competitive bidding. The

Commission did not impose coverage

requirements on the nationwide

geographic area paging licenses. The

Major Trading Area (MTA) and

Economic Area (EA) geographic area

licensees, which are not exempt from

competitive bidding, are required to

provide coverage to one-third of the

geographic area population within three

years of license grant, and to two-thirds

of the geographic area population

within five years of license grant. In the

alternative, the MTA or EA licensee may

provide substantial service to the

geographic area within five years of

license grant. In this Further Notice of

Proposed Rulemaking (FNPRM), the

Commission seeks comment on whether

coverage requirements should be

imposed on nationwide licenses, and

the appropriate coverage area. The

Commission seeks comment on whether

the entire nationwide license, or just a

portion of the license, should be

auctioned if the nationwide licensee

fails to meet the coverage requirements.

B. Partitioning and Disaggregation

1. Partitioning

a. In General

In the Second Report and Order, the

Commission adopted geographic

partitioning provisions for MTA and EA

geographic area paging licensees. In this

FNPRM, the Commission seeks

comment on whether nationwide paging

licensees should be permitted to

partition their license area. Commenters

should note that the three 931 MHz

nationwide channels and twenty-three

929 MHz nationwide channels are not

subject to competitive bidding, whereas

the MTA and EA geographic area

licenses are subject to competitive

bidding.

4. The Commission believes that

partitioning can be an effective means of

providing paging licensees with the

flexibility they need to tailor their

service offerings to meet market

demands. Partitioning may be used to

create smaller licenses and thus also

facilitate greater participation by small

businesses and rural telephone

companies. The Commission did not,

however, seek comment in the NPRM in

WT Docket No. 96–18 on the treatment

of MTA and EA geographic area paging

licensees that receive competitive

bidding benefits, the license term of

partitioned licenses, or build-out

requirements. The Commission seeks

comment on these issues with respect to

geographic area paging licenses.

b. Licensees With Competitive Bidding

Benefits

5. Providing licensees with the

flexibility to partition their geographic

service areas will create smaller areas

that can be licensed to small businesses,

including those entities without the

resources to participate successfully in

spectrum auctions. The competitive

bidding rules for paging include

provisions for installment payments and

bidding credits for small businesses.

The Commission has also adopted rules

to prevent unjust enrichment by small

businesses seeking to transfer licenses

obtained with installment payments or

bidding credits. The Commission seeks

comment on how to adjust installment

payments owed by partitioning

licensees. Parties are invited to

comment on whether a small business

partitioner should be required to repay,

on an accelerated basis, a portion of the

outstanding principal balance owed

under an installment payment plan. The

Commission seeks comment on how

this payment should be calculated. The

Commission seeks comment on whether

the partitionee should be required to

guarantee payment of a portion of the

partitioner’s obligation.

6. The Commission tentatively

concludes that partitionees that would

qualify as small businesses should be

permitted to pay their pro rata share of

the remaining government obligation

through installment payments. The

Commission seeks comment on this

tentative conclusion. Commenters

should address the mechanisms for

apportioning the remaining government

obligation between the parties. The

Commission proposes using population

as the objective measure to calculate the
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relative value of the partitioned area,

and seeks comment on this proposal.

7. The Commission proposes applying

unjust enrichment rules to small

businesses that partition to non-small

businesses or to small businesses

qualifying for a lower bidding credit.

The Commission seeks comment on this

proposal. These unjust enrichment

provisions would include accelerated

payment of bidding credits, unpaid

principal, and accrued unpaid interest.

The Commission seeks comment on

how such unjust enrichment amounts

should be calculated. Commenters

should address how to calculate unjust

enrichment amounts and how to enforce

unjust enrichment payments. The

Commission seeks comment on whether

the price paid by the partitionee should

be considered in determining the

percentage of the outstanding principal

balance to be repaid. Commenters

should address whether the unjust

enrichment payments should be

calculated on a proportional basis, using

population of the partitioned area as the

objective measure.

8. The Commission seeks comment on

whether each party to a partitioning

transfer should be required to guarantee

all or a portion of the partitioner’s

original auctions-related obligation in

the event of default or bankruptcy by

any of the parties to the partitioning

transfer. The Commission seeks

comment on whether the partitioner

(the original licensee) should continue

to be responsible, with respect to the

auctions-related obligation, for the

entire initial geographic area.

c. Build-out requirements

9. In the Second Report and Order,

the Commission adopted coverage

requirements for MTA and EA

geographic area licensees. Specifically,

each MTA or EA geographic area

licensee must provide coverage to onethird of the geographic area population

within three years of the license grant,

and to two-thirds of the geographic area

population within five years of the

license grant. In the alternative, the

MTA or EA licensee may provide

substantial service to the geographic

area within five years of license grant.

The Commission tentatively concludes

that both the partitioner and the

partitionee should be subject to

coverage requirements that ensure that

both portions of the license area will

receive service. The Commission

proposes that a partitionee will be

obligated to satisfy the same build-out

requirements as the original licensee

within its partitioned area, regardless of

when the license was acquired. A

partitionee of an MTA or EA would

provide coverage to one-third of the

population in its partitioned area within

three years of the license grant, and to

two-thirds of the population within its

partitioned area within five years of the

license grant. In the alternative, the

partitionee may provide substantial

service to the partitioned geographic

area within five years of license grant.

Parties are invited to comment on this

proposal. Commenters should also

address build-out requirements for

partitioned nationwide licenses.

Commenters are also invited to address

what build-out requirements should

apply where a licensee partitions a

portion of its license area after the

initial ten-year license term has expired.

d. License term

10. A geographic area paging licensee

is authorized to provide service for no

more than ten years from the date of

license grant. A licensee may submit an

application to renew the license for an

additional license term, and is afforded

a renewal expectancy if it can

demonstrate that it has provided

substantial service during the past

license term and has substantially

complied with the applicable

Commission rules, policies, and the

Communications Act. Substantial

service is service which is sound,

favorable, and substantially above a

mediocre level of service which might

just minimally warrant renewal.

11. The Commission proposes that a

partitionee (including a nationwide

license partitionee) be authorized to

hold its license for the remainder of the

partitioner’s original ten-year term. The

Commission tentatively concludes that

this approach is reasonable because a

partitioner-licensee should not be able

to confer greater rights than it was

awarded under the terms of its license

grant. The Commission seeks comment

on this tentative conclusion. The

Commission also proposes that a

partitionee be afforded the same

renewal expectancy as a geographic area

licensee. The Commission proposes to

grant a partitionee a preference at a

renewal proceeding if it can

demonstrate that it has provided

substantial service during its past

license term and has substantially

complied with the applicable

Commission rules, policies, and the

Communications Act. The Commission

seeks comment on these proposals.

2. Disaggregation

a. In General

12. In the NPRM, the Commission

asked parties to comment on whether

paging spectrum disaggregation should

be allowed. The Commission did not

receive sufficient comment on this issue

to adopt disaggregation for paging

services. The Commission seeks further

comment on the feasibility of spectrum

disaggregation for paging. Commenters

should provide technical justifications

and other relevant support in

responding to this issue. Commenters

should address whether minimum

disaggregation standards are necessary

for paging services. Commenters should

also address whether nationwide

licensees should be permitted to

disaggregate spectrum.

b. Licensees With Competitive Bidding

Benefits

13. The Commission also seeks

comment on what the respective

obligations of the participants in a

disaggregation transfer should be, and

whether each party should be required

to guarantee a proportionate amount of

the disaggregator’s original auctionsrelated obligation in the event of default

or bankruptcy by any of the parties to

the disaggregation transfer. The

Commission seeks comment on whether

the disaggregator (the original licensee)

should have a continuing obligation

with respect to the entire initial license.

Alternatively, should the parties have

available a choice of options, ranging

from an accelerated payment based on

purchase price to a guarantee for a larger

payment by one party in the event

another party defaults? Parties are

invited to comment on whether the

disaggregating parties should be able to

determine which party has a continuing

obligation with respect to the original

license area.

14. The Commission proposes to

allow all small business licensees to

disaggregate to similarly qualifying

parties as well as parties not eligible for

small business provisions. The

Commission tentatively concludes that

if a qualified small business licensee is

permitted to disaggregate to a non-small

business entity, the disaggregating

licensee should be required to repay any

benefits it received from the small

business special provisions on a

proportional basis. This would include

accelerated payment of bidding credits,

unpaid principal, and accrued unpaid

interest. The Commission seeks

comment on how such repayment

amounts should be calculated. The

Commission also seeks comment on

whether we should consider the price

paid by the disaggregatee in determining

the percentage of the outstanding

principal balance to be repaid.

15. The Commission tentatively

concludes that if a small business

licensee is permitted to disaggregate to
11640 Federal Register / Vol. 62, No. 48 / Wednesday, March 12, 1997 / Proposed Rules

another qualified small business that

would not qualify for the same level of

bidding credit as the disaggregating

licensee, the disaggregating licensee

should be required to repay a portion of

the benefit it received. The Commission

seeks comment on how that amount

should be calculated. Finally, the

Commission seeks comment on what

provisions, if any, should be adopted to

address the situation of a small business

licensee’s disaggregation followed by

default in payment of a winning bid at

auction.

c. Build-Out Requirements

16. The Commission requires each

MTA or EA geographic area licensee to

provide coverage to one-third of the

geographic area population within three

years of the license grant, and to twothirds of the geographic area population

within five years of the license grant. In

the alternative, the MTA or EA licensee

may provide substantial service to the

geographic area within five years of

license grant. The Commission proposes

adopting a flexible approach for

construction requirements on both the

disaggregator and disaggregatee for their

respective spectrum portions. The

Commission proposes that either the

disaggregator or the disaggregatee

entering the geographic market should

be obligated to provide coverage to onethird of the population within three

years of the license grant, and to twothirds of the population within five

years of the license grant. In the

alternative, either the disaggregator or

the disaggregatee may provide

substantial service to the geographic

area within five years of license grant.

The Commission seeks comment on this

proposal. Commenters should also

address the appropriate build-out

requirements for the parties to

disaggregation of nationwide paging

licenses. The Commission proposes that

if a licensee fails to meet the

construction requirements, the license

reverts back to the Commission. The

Commission seeks comment on this

proposal.

d. License Term

17. The Commission proposes a

similar license term for disaggregation

as for partitioning, i.e., a disaggregatee

would be authorized to hold its license

for the remainder of the disaggregator’s

original ten-year license term. The

Commission proposes that a

disaggregatee would be afforded a

renewal expectancy if it can

demonstrate that it has provided

substantial service during the past

license term and has substantially

complied with the applicable

Commission rules, policies, and the

Communications Act. The Commission

seeks comment on these proposals, and

on how to apply the renewal standard

in cases where the disaggregatee has

acquired the disaggregated license near

the end of the license term.

3. Combination of Partitioning and

Disaggregation

18. The Commission tentatively

concludes that combinations of

partitioning and disaggregation should

be permitted, subject to the rules

proposed for each. The Commission

seeks comment on this proposal.

Commenters should address any

conflicts in the partitioning and

disaggregation rules and whether the

Commission should implement the

partitioning rules in such cases.

Commenters should also address

whether the Commission should allow

the combination of partitioning and

disaggregation for nationwide paging

licenses.

C. Shared Channels

19. The issue of paging license

application fraud was initially raised in

the comments filed by the Federal Trade

Commission (FTC). According to the

FTC, telecommunications investment

frauds are of two basic types: (1)

‘‘Application mills,’’ where

telemarketers sell application

preparation services for wireless

licenses for thousands of dollars to

consumers, by claiming that

telecommunications businesses will

seek to lease or sell the licenses for

many times the telemarketers’

applications fees; and (2) ‘‘build-out’’

schemes, where telemarketers sell, again

for thousands of dollars, interests in

limited liability companies or

partnerships that supposedly will

acquire wireless licenses, build and

operate telecommunications systems,

and pay the consumers high dividends.

The FTC argued that awarding licenses

on a geographic basis through

competitive bidding would likely

reduce the incidence of ‘‘application

mills’’ for paging licenses. The FTC

explained that awarding licenses on an

unlimited, shared basis is especially

prone to abuse, because the constant

availability of such licenses allows

telemarketers to guarantee licenses to

unsuspecting consumers. The transition

of the exclusive paging channels to

geographic area licensing might make

the shared channels even more inviting

to the fraudulent application mills. The

Commission seeks comment on how to

eliminate or reduce this problem.

20. Specifically, the Commission

seeks comment on how the current FCC

Form 600 application could be revised

to provide applicants with information

regarding the risks of

telecommunications investment and

warning signs of possible investment

fraud. In addition, the Commission

seeks comment on whether application

preparation services should be required

to sign the FCC Form 600, and to certify

that the applicant has received in

writing pertinent information regarding

the Commission’s rules and the

obligations of licensees. Commenters are

also invited to address whether PCIA

should be required to implement

additional procedures in the

coordination process to reduce

fraudulent or speculative applications.

II. Conclusion

21. The Commission believes that the

proposals in the FNPRM will provide

paging licensees the flexibility needed

to tailor their service offerings to meet

market demands, and facilitate greater

participation by small businesses.

Additionally, a revision to the

application process for shared channels

to provide applicants with information

regarding the risks of

telecommunications investment and the

warning signs of possible investment

fraud may reduce fraudulent or

speculative applications.

III. Procedural Matters and Ordering

Clauses

A. Regulatory Flexibility Act

Summary

22. As required by section 603 of the

Regulatory Flexibility Act, 5 U.S.C. 603,

the Commission has prepared an Initial

Regulatory Flexibility Analysis (IRFA)

of the expected impact on small entities

of the policies and rules proposed in

this FNPRM. Written public comments

on the IRFA are requested.

Reason for Action

23. This rulemaking proceeding in

WT Docket No. 96–18 was initiated to

secure comment on proposals for

establishing a regulatory scheme for the

common carrier paging (CCP) and

private carrier paging (PCP) services

which would promote efficient

licensing and competition in the

commercial mobile radio marketplace.

The Commission seeks further comment

on several issues: whether nationwide

licenses should be subject to coverage

requirements, how bidding credits and

installment payments should be treated

in cases where small businesses wish to

partition their licenses, how build-out

requirements and license term are

affected in cases of geographic

partitioning by paging market area
Federal Register / Vol. 62, No. 48 / Wednesday, March 12, 1997 / Proposed Rules 11641

licensees, whether spectrum

disaggregation is feasible for paging

licensees, and revisions to the current

FCC Form 600 and the application

procedures for licenses on the shared

channels to reduce paging application

fraud.

Objectives

24. The Second Report and Order

grants 26 nationwide geographic area

licenses to nationwide paging licensees,

but does not impose any additional

coverage beyond what the nationwide

licensees have already achieved. In the

FNPRM, the Commission seeks

comment on whether coverage

requirements are appropriate.

25. In the Second Report and Order

the Commission allows all licensees,

including small business licensees, to

partition at any time to another eligible

entity. In the FNPRM the Commission

proposes that unjust enrichment

provisions should apply when a small

business licensee has benefitted from

the small business provisions in the

auction rules and then partitions a

portion of the license area to another

entity that would not qualify for such

benefits, or would qualify for a lower

bidding credit. Without the unjust

enrichment provisions on such

transactions, a small business could

benefit from special bidding provisions

and then become unjustly enriched by

immediately partitioning a portion of

the license area to parties that do not

qualify for such benefits. The objective

of this proposal is to prevent unjust

enrichment.

26. In the FNPRM the Commission

seeks comment on build-out

requirements and license term for

partitioned geographic area licenses

(including nationwide licenses). The

Commission also seeks comment on

whether nationwide licensees should be

permitted to partition their license area,

build-out requirements for partitioned

nationwide licenses, and the license

term of partitioned nationwide licenses.

27. In the FNPRM the Commission

seeks comment on whether spectrum

disaggregation would be feasible for

paging, and how much spectrum a

paging licensee should be permitted to

disaggregate. The Commission seeks

comment on build-out requirements and

license term for disaggregated

geographic area licenses. If spectrum

disaggregation is feasible in paging it

may facilitate the efficient use of

spectrum, increase competition, and

expedite service to the public.

28. The Commission also seeks

comment on paging application fraud,

an issue raised by the Federal Trade

Commission. Specifically, the

Commission seeks comment on whether

the current FCC Form 600 should be

revised to warn paging applicants of the

risk of application fraud, and whether

application preparation services should

be required to certify that the applicant

has received information regarding the

Commission’s rules and the obligations

of licensees. Additionally, commenters

are invited to address whether the

frequency coordinator should

implement additional procedures to

reduce fraudulent or speculative paging

applications. The objective of these

proposals is to inform consumers of the

rules and the prevalence of paging

application fraud and thus reduce fraud

and speculation.

Legal Basis

29. The proposed action is authorized

under sections 4(i), 257, 303(r), and

309(j) of the Communications Act of

1934, as amended, 47 U.S.C. 154(i), 257,

303(r), and 309(j).

Reporting, Recordkeeping, and Other

Compliance Requirements

30. Nationwide Channels. The

proposals in the FNPRM include the

possibility of imposing reporting and

recordkeeping requirements for the

nationwide geographic area licensees to

establish compliance with the coverage

requirements, if coverage requirements

are adopted.

31. Geographic Partitioning and

Spectrum Disaggregation. The proposals

in the FNPRM include the possibility of

imposing reporting and recordkeeping

requirements for small businesses

seeking licenses through the proposed

partitioning and disaggregation rules.

The information requirements would be

used to determine if the licensee is a

qualifying entity to obtain a partitioned

license or disaggregated spectrum. This

information will be a one-time filing by

any applicant requesting such a license.

The information will be submitted on

the FCC Forms 490 (or 430 and/or 600

filed as one package under cover of the

Form 490) which are currently in use

and have already received OMB

clearance. The Commission estimates

that the average burden on the applicant

is three hours for the information

necessary to complete these forms. The

Commission estimates that 75 percent of

the respondents (which may include

small businesses) will contract out the

burden of responding. The Commission

estimates that it will take approximately

30 minutes to coordinate information

with those contractors. The remaining

25 percent of respondents (which may

include small businesses) are estimated

to employ in-house staff to provide the

information. Applicants (including

small businesses) filing the package

under cover of FCC Form 490

electronically will incur a $2.30 per

minute on-line charge. On-line time

would amount to no more than 30

minutes. The Commission estimates that

75 percent of the applicants may file

electronically. The Commission

estimates that applicants contracting out

the information would use an attorney

or engineer (average of $200 per hour)

to prepare the information.

32. It is also possible that small

business partitioners and disaggregators

will be required to repay, on an

accelerated basis, a portion of the

outstanding principal balance owed

under an installment payment plan. If

unjust enrichment rules are applied to

small businesses that partition or

disaggregate to non-small businesses, or

to small businesses qualifying for a

lower bidding credit, small businesses

may be required to reimburse the United

States government for all or a portion of

the special competitive bidding benefits

they have received. This could include

accelerated payment of bidding credits,

unpaid principal, and accrued unpaid

interest. It is also possible that each

party to a partitioning or disaggregation

transfer could be required to guarantee

all or a portion of the partitioner’s or

disaggregator’s original auctions-related

obligation in the event of default or

bankruptcy by any of the parties.

33. Shared Channels. The proposals

in the FNPRM do not include the

possibility of imposing reporting and

recordkeeping requirements for small

businesses seeking licenses for shared

channels. The FNPRM seeks comment

on whether the current FCC Form 600

application should be revised to warn

applicants of the risk of application

fraud; whether application preparation

services should be required to certify

that the applicant has received

information regarding the Commission’s

rules; and whether the frequency

coordinator should be required to

implement additional procedures in the

coordination process to reduce the

likelihood of fraudulent applications.

These proposals would, if implemented,

furnish additional information to

applicants. None of these proposals

would impose reporting or

recordkeeping requirements on small

businesses.

Federal Rules Which Overlap, Duplicate

or Conflict With These Rules

34. None.

Description and Number of Small

Entities Involved

35. Nationwide Channels. The rule

changes discussed in the FNPRM with
11642 Federal Register / Vol. 62, No. 48 / Wednesday, March 12, 1997 / Proposed Rules

respect to implementing coverage

requirements for the 26 nationwide

licenses will probably not directly affect

small businesses because nationwide

licensees are probably not small

businesses. However, if all 26

nationwide licenses are held by small

businesses, the rule change would not

affect more than 26 small businesses.

36. Geographic Partitioning and

Spectrum Disaggregation. The

partitioning and disaggregation rule

changes proposed in this proceeding

will affect all small businesses which

avail themselves of these rule changes,

including small businesses currently

holding paging licenses who choose to

partition and/or disaggregate and small

businesses who may acquire licenses

through partitioning and/or

disaggregation. 37. The Commission is required to

estimate in its Final Regulatory

Flexibility Analysis the number of small

entities to which a rule will apply,

provide a description of such entities,

and assess the impact of the rule on

such entities. To assist the Commission

in this analysis, commenters are

requested to provide information

regarding how many total entities,

existing and potential, would be

affected by the proposed rules in the

FNPRM. In particular, the Commission

seeks estimates of how many such

entities, existing and potential, will be

considered small businesses. The Small

Business Administration (SBA) has not

developed a definition of small business

specifically applicable to paging. The

closest applicable definition under the

SBA rules is radiotelephone (wireless)

companies. According to the SBA’s

definition, a small business

radiotelephone company is one

employing fewer than 1,500 persons.

The Commission seeks comment on

whether this definition is appropriate

for paging licensees in this context.

Additionally, the Commission requests

each commenter to identify whether it

is a small business under this definition.

If a commenter is a subsidiary of

another entity, this information should

be provided for both the subsidiary and

the parent corporation or entity. 38. The Commission estimates that up

to approximately 50,000 licensees or

potential licensees could take the

opportunity to partition and/or

disaggregate a license or obtain a license

through partitioning and/or

disaggregation. This number is based on

the total geographic area licenses to be

awarded (approximately 16,600) and an

estimate that each license will probably

not be partitioned and/or disaggregated

to more than three parties. Given the

fact that nearly all radiotelephone

companies have fewer than 1,000

employees, and that no reliable estimate

of the number of future paging licensees

can be made, the Commission assumes

for purposes of this IRFA that all of the

licenses will be awarded to small

businesses. It is possible that a

significant number of the up to

approximately 50,000 licensees or

potential licensees who could take the

opportunity to partition and/or

disaggregate a license or who could

obtain a license through partitioning

and/or disaggregation will be small

businesses.

39. Shared Channels. The rule

changes proposed in the FNPRM with

respect to warning prospective

applicants about paging application

fraud would probably not have an

impact on any small business or other

entity applying for a paging license on

a shared channel. The proposed changes

to the paging license application are

intended to warn consumers about the

prevalence of application fraud.

Significant Alternatives Minimizing the

Impact on Small Entities Consistent

With the Stated Objectives

40. The Commission seeks comment

on whether coverage requirements

should be imposed for the nationwide

geographic area licensees. Any

significant alternatives presented in the

comments will be considered. Coverage

requirements for the nationwide

geographic area licensees, if adopted,

would probably not affect small

businesses.

41. With respect to partitioning, the

Commission seeks comment on whether

nationwide licensees should be

permitted to partition their license area,

build-out requirements for partitioned

nationwide licenses, and license term of

partitioned nationwide licenses. For

MTA and EA geographic area licenses,

the Commission proposes that unjust

enrichment provisions should apply

when a licensee has benefitted from the

small business provisions in the auction

rules and partitions a portion of the

geographic license area to another entity

that would not qualify for such benefits.

The alternative to applying the unjust

enrichment provisions would be to

allow an entity who had benefitted from

the special bidding provisions for small

businesses to become unjustly enriched

by partitioning a portion of their license

area to parties that do not qualify for

such benefits. The Commission also

seeks comment on build-out

requirements and license term for

partitioned MTA and EA geographic

area licenses.

42. The Commission seeks comment

on whether spectrum disaggregation

would be feasible for paging, and how

much spectrum a paging licensee

should be permitted to disaggregate. The

Commission seeks comment on buildout requirements and license term for

disaggregated geographic area licenses.

If spectrum disaggregation is feasible in

paging it may facilitate the efficient use

of spectrum, increase competition, and

expedite service to the public.

43. The Commission also seeks

comment on an issue raised by the

Federal Trade Commission in comments

regarding paging application fraud.

Specifically, the Commission seeks

comment on whether the current FCC

Form 600 should be revised to warn

applicants of the risk of application

fraud, and whether application

preparation services should be required

to certify that the applicant has received

information regarding the Commission’s

rules and the obligations of licensees.

Commenters are invited to address

whether the frequency coordinator

should implement additional

procedures to reduce fraudulent or

speculative paging applications. The

alternative to revising the application

and/or the coordination process could

permit application mill fraud which

may affect many unwitting consumers.

44. The FNPRM solicits comment on

a variety of alternatives discussed

herein. Any significant alternatives

presented in the comments will be

considered.

B. Paperwork Reduction Act

45. This FNPRM contains either a

proposed or modified information

collection. As part of its continuing

effort to reduce paperwork burdens, the

Commission invites 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, Pub. L. 104–13. Public and

agency comments are due at the same

time as other comments on this FNPRM;

OMB notification of action is due May

12, 1997. 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.

46. Dates: Written comments by the

public on the proposed information
Federal Register / Vol. 62, No. 48 / Wednesday, March 12, 1997 / Proposed Rules 11643

collections are due April 11, 1997.

Written comments must be submitted by

the Office of Management and Budget

(OMB) on the proposed information

collections on or before May 12, 1997.

47. Addresses: In addition to filing

comments with the Secretary, a copy of

any comments on the information

collections contained herein should be

submitted to Dorothy Conway, Federal

Communications Commission, Room

234, 1919 M Street, NW., Washington,

DC 20554, or via the Internet to

dconway@fcc.gov, and to Timothy Fain,

OMB Desk Officer, 10236 NEOB, 725–

17th Street, NW., Washington, DC 20503

or via the Internet to fainlt@al.eop.gov.

48. Further Information: For

additional information concerning the

information collections contained in

this NPRM contact Dorothy Conway at

(202) 418–0217, or via the Internet at

dconway@fcc.gov.

49. Supplementary Information:

Title: Revision of part 22 and part 90

of the Commission’s rules to Facilitate

Future Development of Paging Systems

and Implementation of section 309(j) of

the Communications Act—Competitive

Bidding

Type of Review: New Collection.

Respondents:

Number of Respondents: We estimate

that approximately 50,000 licensees or

potential licensees could take the

opportunity to partition or disaggregate

a license or obtain a license through

partitioning or disaggregation.

Estimated Time Per Response: The

average burden on the applicant is 3

hours for the information necessary to

complete FCC Forms 490 or 430 and 600

filed under cover of the FCC Form 490.

We estimate that 75 percent of the

respondents will contract out the

burden of responding. We estimate that

it will take approximately 30 minutes to

coordinate information with those

contractors. The remaining 25 percent of

respondents are estimated to employ inhouse staff to provide the information.

37,500 applicants (contracting out) × .5

hour = 18,750 hours

12,500 applicants (in-house) × 3 hours

= 37,500 hours

Total burden = 18,750 + 37,500 = 56,250

hours.

Estimated Cost to the Respondent:

Total capital and start-up costs:

Applicants wishing to file the package

under cover of the FCC Form 490

electronically will incur a $2.30 per

minute on-line charge. On-line time

would amount to no more than 30

minutes. Seventy-five percent of

applicants are expected to file

electronically.

37,500 applications × $2.30 × 30 =

$2,587,500

All other respondents are expected to

file manually and would incur the

following costs:

12,500 applications × $1.15 = $14,375

Total capital and start-up costs =

$2,587,500 + $14,375 = $2,601,875.

We assume that the respondents

contracting out the information would

use an attorney or engineer (average

$200 per hour) to prepare the

information.

37,500 applications × $200 per hour ×

3 hours = $22,500,000

Total respondent costs: $2,601,875 +

$22,500,000 = $25,101,875

Cost to the Federal Government: The

government review time per response

for this submission is estimated at 15

minutes per response with review being

done by personnel at the GS–6 level.

50,000 applications × $3.39 = $169,500

C. Ex Parte Presentations—NonRestricted Proceeding

50. This is a non-restricted notice and

comment rulemaking proceeding. Ex

parte presentations are permitted,

except during the Sunshine Agenda

period, provided that they are disclosed

as provided in the Commission’s rules.

See generally 47 CFR 1.1202, 1.1203,

1.1206(a).

D. Comment Period

51. Pursuant to applicable procedures

set forth in §§ 1.415 and 1.419 of the

Commission’s rules, 47 CFR 1.415,

1.419, interested parties may file

comments on or before April 17, 1997.

Reply comments are to be filed on or

before May 1, 1997. To file formally in

this proceeding, you must file an

original and four copies of all

comments, reply comments, and

supporting comments. If you want each

Commissioner to receive a personal

copy of your comments, you must file

an original and nine copies. Comments

and reply comments should be sent to

Office of the Secretary, Federal

Communications Commission, 1919 M

Street, NW., Room 222, Washington, DC

20554. Parties should also submit two

copies of comments and reply

comments to Bobby Brown, Commercial

Wireless Division, Wireless

Telecommunications Bureau, 2025 M

Street, NW., Room 7130, Washington,

DC 20554. Parties should also file one

copy of any documents filed in this

docket with the Commission’s copy

contractor, International Transcription

Services, Inc., 2100 M Street, NW., Suite

140, Washington, DC 20037. Comments

and reply comments will be available

for public inspection during regular

business hours in the FCC Reference

Center, Room 239, 1919 M Street, NW.,

Washington, DC 20554.

E. Authority

52. Authority for issuance of this

Further Notice of Proposed Rulemaking

is contained in sections 4(i), 257, 303(r),

and 303(j) of the Communications Act of

1934, as amended, 47 U.S.C. § 154(i),

257, 303(r), and 303(j).

F. Ordering Clauses

53. Accordingly, it is ordered that,

pursuant to the authority of sections

4(i), 257, 303(r), and 303(j) of the

Communications Act of 1934, as

amended, 47 U.S.C. § 154(i), 257, 303(r),

and 303(j), a Further Notice of Proposed

Rulemaking is hereby adopted.

54. It is further ordered that

comments in WT Docket No. 96–18 will

be due April 17, 1997 and reply

comments will be due May 1, 1997.

List of Subjects

47 CFR Part 22

Communications common carriers,

Reporting and recordkeeping

requirements.

47 CFR Part 90

Common carriers, Reporting and

recordkeeping requirements.

Federal Communications Commission.

William F. Caton,

Acting Secretary.

[FR Doc. 97–6091 Filed 3–11–97; 8:45 am]

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