Federal Register / Vol. 74, No. 104 / Tuesday, June 2, 2009 / Proposed Rules 26329 

concerning the establishment of three 

temporary restricted anchorages with 

associated safety/security zones within 

the Captain of the Port Zone 

Jacksonville. The proposed rule is being 

withdrawn because the geographic 

locations of the proposed anchorage 

areas are beyond three nautical miles 

from the baseline of the territorial sea. 

DATES: The proposed rule published at 

73 FR 12925, March 11, 2008, is 

withdrawn, as of June 2, 2009. 

ADDRESSES: The docket for this 

withdrawn rulemaking is available for 

inspection or copying at the Docket 

Management Facility (M–30), U.S. 

Department of Transportation, West 

Building Ground Floor, Room W12–140, 

1200 New Jersey Avenue SE., 

Washington, DC 20590, between 9 a.m. 

and 5 p.m., Monday through Friday, 

except Federal holidays. You may also 

find this docket on the Internet by going 

to http://www.regulations.gov, selecting 

the Advanced Docket Search option on 

the right side of the screen, inserting 

USCG–2008–0006 in the Docket ID box, 

pressing Enter, and then clicking on the 

item in the Docket ID column. 

FOR FURTHER INFORMATION CONTACT: If 

you have questions about this notice, 

contact Lieutenant Commander Mark 

Gibbs at U.S. Coast Guard Sector 

Jacksonville Prevention Department, 

telephone 904–564–7563, e-mail 

Mark.A.Gibbs@uscg.mil. If you have 

questions on viewing material in the 

docket, call Renee V. Wright, Program 

Manager, Docket Operations, telephone 

202–366–9826. 

SUPPLEMENTARY INFORMATION: 

Background 

On March 11, 2008, we published a 

notice of proposed rulemaking entitled 

‘‘Seventh Coast Guard District, Captain 

of the Port Zone Jacksonville, 

Temporary Restricted Anchorage’’ in the 

Federal Register (73 FR 12925). We 

received no comments on the proposed 

rule; no public meeting was requested 

and none was held. 

The rulemaking concerned 

establishment of three, multi-purpose, 

temporary restricted anchorages with 

associated safety/security zones to 

service vessels intending to call on the 

ports of Jacksonville or Fernandina, 

within the Captain of the Port Zone 

Jacksonville as defined by 33 CFR 3.35– 

20. These temporary restricted 

anchorages and associated safety/ 

security zones were designed for the 

geographic separation and/or restriction 

of vessels or persons on such vessels 

when such vessels or persons pose or 

are suspected of posing a safety, public 

health, environmental, or security 

threat. 

Withdrawal 

The proposed rule sought to establish 

anchorage areas beyond three nautical 

miles from the territorial sea baseline. 

Currently, the Coast Guard’s authority 

under the Rivers and Harbors Act does 

not allow it to create anchorages more 

than three miles from the territorial sea 

baseline (see 33 CFR 2.20 and 2.22). 

Therefore, we are withdrawing our 

proposal, which was published on 

March 11, 2008, in the Federal Register 

(73 FR 12925). 

Authority: We issue this notice of 

withdrawal under the authority of 33 U.S.C. 

471, 1221 through 1236, 2030, 2035, 2071; 33 

CFR 1.05–1; and Department of Homeland 

Security Delegation No. 0170.1. 

Dated: May 12, 2009. 

R.S. Branham, 

Rear Admiral, U.S. Coast Guard, Commander, 

Coast Guard Seventh District. 

[FR Doc. E9–12707 Filed 6–1–09; 8:45 am] 

BILLING CODE 4910–15–P 

FEDERAL COMMUNICATIONS 

COMMISSION 

47 CFR Part 1 

[MD Docket No. 09–65; FCC 09–38] 

Assessment and Collection of 

Regulatory Fees for Fiscal Year 2009 

AGENCY: Federal Communications 

Commission. 

ACTION: Notice of proposed rulemaking. 

SUMMARY: The Commission will revise 

its Schedule of Regulatory Fees in order 

to recover an amount of $341,875,000 

that Congress has required the 

Commission to collect for fiscal year 

2009. Section 9 of the Communications 

Act of 1934, as amended, provides for 

the annual assessment and collection of 

regulatory fees under sections 9(b)(2) 

and 9(b)(3), respectively, for annual 

‘‘Mandatory Adjustments’’ and 

‘‘Permitted Amendments’’ to the 

Schedule of Regulatory Fees. 

DATES: Comments are due June 4, 2009, 

and reply comments are due June 11, 

2009. 

ADDRESSES: You may submit comments, 

identified by MD Docket No. 09–65, by 

any of the following methods: 

• Federal eRulemaking Portal: http:// 

www.regulations.gov. Follow the 

instructions for submitting comments. 

• Federal Communications 

Commission’s Web Site: http:// 

www.fcc.gov/cgb/ecfs. Follow the 

instructions for submitting comments. 

• E-mail: ecfs@fcc.gov. Include MD 

Docket No. 09–65 in the subject line of 

the message. 

• Mail: Commercial overnight mail 

(other than U.S. Postal Service Express 

Mail) and Priority Mail, must be sent to 

9300 East Hampton Drive, Capitol 

Heights, MD 20743. U.S. Postal Service 

first-class, Express, and Priority mail 

should be addressed to 445 12th Street, 

SW., Washington DC 20554. 

FOR FURTHER INFORMATION CONTACT: 

Daniel Daly, Office of Managing Director 

at (202) 418–1832. 

SUPPLEMENTARY INFORMATION: 

Adopted: May 11, 2009; Released: 

May 14, 2009. 

By the Commission: Acting Chairman 

Copps issuing a statement. 

TABLE OF CONTENTS

Heading Paragraph 

No. 

I. INTRODUCTION ................................................................................................................................................................................... 1 

II. NOTICE OF PROPOSED RULEMAKING ............................................................................................................................................ 2 

A. FY 2009 Regulatory Fee Assessment Methodology—Development of FY 2009 Regulatory Fees ........................................... 2 

B. Regulatory Fee Obligations for Digital Broadcasters .................................................................................................................. 5 

C. Commercial Mobile Radio Service Messaging Service ............................................................................................................... 8 

D. International Bearer Circuits ........................................................................................................................................................ 9 

E. Administrative and Operational Issues ....................................................................................................................................... 11 

1. Mandatory Use of Fee Filer ................................................................................................................................................... 12 

2. Notification and Collection of Regulatory Fees ................................................................................................................... 16 

a. Pre-bills ............................................................................................................................................................................ 16 

26330 Federal Register / Vol. 74, No. 104 / Tuesday, June 2, 2009 / Proposed Rules 

1 47 U.S.C. 159(a)(1). 

2See Omnibus Appropriations Act, 2009, Public 

Law 111–8. 

3See Omnibus Appropriations Act, 2009, Public 

Law 111–8. 

4We recently revised the Commission’s 

international bearer circuit (IBC) fee rules by 

adopting a new methodology for calculating 

regulatory fees on both common carrier and noncommon carrier international submarine cable 

systems based on a per system fee. See Assessment 

and Collection of Regulatory Fees for Fiscal Year 

2008, MD Docket No. 08–65, Second Report and 

Order (rel. March 24, 2009) (‘‘Submarine Cable 

Order’’). Under section 9(b)(4)(B) of the Act, we 

must notify Congress 90 days before a permitted 

amendment to the regulatory fees can take effect. 

The 90 day period will elapse as of July 15, 2009. 

For this reason, we are calculating proposed 

regulatory fees for FY 2009 for this service using 

both the new methodology and the old (pre-FY 

2009) methodology. See Appendix A for the 

proposed regulatory fees for international 

submarine cable systems based on the new 

methodology adopted in the Submarine Cable 

Order. See Appendix I for the proposed regulatory 

fees for international submarine cable systems 

based on the current methodology which remains 

in effect pending the Congressional notification 

process. If the 90 day period elapses without 

Congressional objection to the permitted 

amendment, we will use the new methodology 

contained in Appendix A to calculate submarine 

cable fees in our FY 2009 report and order. 

Terrestrial and satellite facilities do not have cable 

landing licenses and will continue to pay regulatory 

fees on a per 64KB circuit basis, under our historic 

methodology as revised in the Submarine Cable 

Order. See Submarine Cable Order at paragraph 20. 

TABLE OF CONTENTS—Continued 

Heading Paragraph 

No. 

b. Future Streamlining of the Regulatory Fee Assessment and Collection Process ....................................................... 17 

III. PROCEDURAL MATTERS ................................................................................................................................................................. 18 

A. Public Notices and Fact Sheets ................................................................................................................................................... 19 

B. Assessment Notifications ............................................................................................................................................................. 20 

1. Media Services Licensees ...................................................................................................................................................... 20 

2. CMRS Cellular and Mobile Services Assessments .............................................................................................................. 22 

C. Streamlined Regulatory Fee Payment Process ............................................................................................................................ 25 

1. Cable Television Subscribers ................................................................................................................................................ 25 

2. CMRS Cellular and Mobile Providers ................................................................................................................................... 26 

3. Interstate Telecommunications Service Providers (‘‘ITSP’’) ............................................................................................... 27 

D. Payment of Regulatory Fees ......................................................................................................................................................... 28 

1. Lock Box Bank ....................................................................................................................................................................... 28 

2. Receiving Bank for Wire Payments ....................................................................................................................................... 29 

3. De Minimis Regulatory Fees ................................................................................................................................................. 30 

4. Standard Fee Calculations and Payment Dates .................................................................................................................... 31 

E. Enforcement .................................................................................................................................................................................. 32 

F. Final Regulatory Flexibility Certification .................................................................................................................................... 34 

G. Initial Regulatory Flexibility Analysis ........................................................................................................................................ 35 

H. Congressional Review Act Analysis ............................................................................................................................................ 36 

I. Initial Paperwork Reduction Act Analysis ................................................................................................................................... 37 

J. Ex Parte Rules ................................................................................................................................................................................ 38 

K. Filing Requirements ..................................................................................................................................................................... 39 

IV. ORDERING CLAUSES ........................................................................................................................................................................ 44 

• Initial Regulatory Flexibility Analysis.

• Proposed Letter to Submarine Cable Operators.

• Sources of Payment Unit Estimates for FY 2009.

• Calculation of FY 2009 Revenue Requirements and Pro-Rata Fees.

• Proposed FY 2009 Schedule of Regulatory Fees.

• Factors, Measurements, and Calculations That Go Into Determining Station Signal Contours and Associated Population 

Coverages.

• FY 2008 Schedule of Regulatory Fees.

• Proposed Rules for FY 2009 International Bearer Circuit Fees.

I. Introduction 

1. Section 9 of the Communications 

Act of 1934, as amended (‘‘the Act’’), 

requires the Commission to assess fees 

to recover the regulatory costs 

associated with the Commission’s 

enforcement, policy and rulemaking, 

user information, and international 

activities.1 The Commission is obligated 

to collect $341,875,000 in regulatory 

fees during Fiscal Year (‘‘FY’’) 2009 to 

fund the Commission’s operations.2 In 

the accompanying Notice of Proposed 

Rulemaking (‘‘NPRM’’), we request 

comment on substantive and procedural 

aspects of our current regulatory fee 

program, including assessment of fees 

on digital broadcasting television 

licensees after the June 12, 2009 nationwide digital transition date. 

II. Notice of Proposed Rulemaking 

A. FY 2009 Regulatory Fee Assessment 

Methodology—Development of FY 2009 

Regulatory Fees 

2. In this NPRM, we seek comment on 

the development of FY 2009 regulatory 

fees collected pursuant to section 9 of 

the Act. For FY 2009, we propose to 

retain the established methods and 

policies that the Commission has used 

to collect regulatory fees in the past 

except as discussed below. For the FY 

2009 regulatory fee cycle, we propose to 

retain most of the administrative 

measures used for notification and 

assessment of regulatory fees of 

previous years. As we have in previous 

years, we seek comment on ways to 

improve the Commission’s 

administrative processes for notifying 

entities of their regulatory fee 

obligations and collecting their 

payments. 

3. The Commission is obligated to 

collect $341,875,000 in regulatory fees 

during FY 2009 to fund the 

Commission’s operations.3 Consistent 

with our established practice, we intend 

to collect these fees in the AugustSeptember 2009 time frame in order to 

collect the required amount by the end 

of the fiscal year. 

4. For our FY 2009 regulatory fee 

assessment, we propose to use 

essentially the same section 9 regulatory 

fee assessment methodology adopted for 

FY 2008, except with regard to 

submarine cable systems or as otherwise 

discussed below.4 Each fiscal year, the 

Commission proportionally allocates to 

fee categories the total amount that must 

be collected through our section 9 

Federal Register / Vol. 74, No. 104 / Tuesday, June 2, 2009 / Proposed Rules 26331 

5See Appendix H for the proposed FY 2009 

regulatory fee assessment methodology, including a 

comparison to the FY 2008 results. 

6See 47 CFR 1.1153. 

7See Assessment and Collection of Regulatory 

Fees for Fiscal Year 2005, MD Docket No. 05–59, 

Report and Order and Order on Reconsideration, 20 

FCC Rcd 12259, 12266–67, paragraph 23 (2005) 

(‘‘FY 2005 Report and Order’’). 

8FY 2008 Report and Order at paragraphs 44–46. 

9See Assessment and Collection of Regulatory 

Fees for Fiscal Year 1997, MD Docket No. 96–186, 

Report and Order, 12 FCC Rcd 17161, 17184–85, 

paragraph 60 (1997) (‘‘FY 1997 Report and Order’’). 

10See Assessment and Collection of Regulatory 

Fees for Fiscal Year 2003, MD Docket No. 03–83, 

Report and Order, 18 FCC Rcd 15985, 15992, 

paragraph 21 (2003) (‘‘FY 2003 Report and Order’’). 

11The subscriber base in the paging industry 

declined 83 percent from 40.8 million to 6.95 

million, from FY 1997 to FY 2008, according to FY 

2008 collection data as of September 30, 2008. 

12We recently revised our IBC fee rules to assess 

fees on both common carrier and non-common 

carrier international subcable systems based on a 

per system fee. Submarine Cable Order at paragraph 

13. 

13See Implementation of Section 9 of the 

Communications Act; Assessment and Collection of 

Regulatory Fees for the 1994 Fiscal Year, Report 

and Order, MD Docket No. 94–19, FCC 94–140, 9 

FCC Rcd 5333, 5367, paragraph 98 (1994). 

14See Assessment and Collection of Regulatory 

Fees for Fiscal Year 1997 (1997 Regulatory Fees 

Order), Report and Order, MD Docket No. 96–186, 

FCC 97–215, 12 FCC Rcd 17161 (1997) aff’d 

Panamsat Corporation v. FCC, 198 F.3d 890, 898 

(D.C. Cir 1998). When including non-common 

carrier satellite operators providing international 

communications among the payors of regulatory 

fees for international bearer circuits, the 

Commission stated that ‘‘although we have not in 

the past required these providers to pay the 

international bearer circuit regulatory fees, we 

conclude that it is now appropriate to impose the 

fee, due to these satellite providers extensive 

participation in services once reserved to the 

common carriers and [non-common carrier] 

undersea cable operators and, in particular, to the 

important role they now play in the provision of 

international bearer circuits.’’ 12 FCC Rcd at 17189, 

at paragraph 71 (1997). 

15On March 17, 2009, the Commission adopted 

the Submarine Cable Order, which changed the 

methodology for calculating regulatory fees for 

international submarine cable operators. After a 

pending 90-day congressional notification period, 

this new methodology will be incorporated into the 

FY 2009 regulatory fee Report and Order and will 

become effective in fiscal year 2009. 

16See FY 2008 Report and Order at paragraph 2. 

The Further NPRM, however, did not seek comment 

on any issues specifically related to IBC fees. See 

id. at paragraph 25–58. 

17See Submarine Cable Order at paragraph 2. 

18 Id., at paragraph 20 n.48 (encouraging 

terrestrial IBC providers, among others, to propose 

any changes to the regulatory fee methodology that 

would better serve their interests). 

regulatory fees.5 Consistent with past 

practice, we propose to divide the FY 

2009 payment amount by the number of 

payment units in each fee category to 

calculate the unit fee. For cases 

involving small fees, we propose to 

divide the resulting unit fee by the term 

of the license. We propose to round 

these fees consistent with the 

requirements of section 9(b)(2) of the 

Act. We seek comment on these 

proposals. 

B. Regulatory Fee Obligations for Digital 

Broadcasters 

5. The rules currently require that 

VHF and UHF stations pay regulatory 

fees; the rules do not specify ‘‘analog’’ 

or ‘‘digital.’’ 6 In our FY 2005 Report and 

Order, we stated that we had sought 

comment on whether to establish 

regulatory fee obligations for digital 

broadcasters but received no comments 

on the issue and did not establish 

regulatory fee obligations for digital 

broadcasters at that time.7 We instead 

maintained that the regulatory fee 

obligation applied only for analog 

broadcaster facilities. Again in the 

Commission’s FY 2008 Report and 

Order, we sought comment on how to 

assess regulatory fees after the 

conversion from analog to digital 

broadcasting, which will be completed 

on June 12, 2009 for full-power 

stations.8 We again received no 

comments on this issue. 

6. Consistent with past years, we will 

not assess FY 2009 regulatory fees for 

both digital and analog licenses from a 

licensee in the process of transitioning 

from analog to digital. Stations that were 

broadcasting in both analog and digital 

on October 1, 2008 will be assessed FY 

2009 regulatory fees for their analog 

license only. Also consistent with our 

past practice, stations that were 

broadcasting in digital only on October 

1, 2008 will not be assessed regulatory 

fees for their digital license for FY 2009. 

7. Beginning in FY 2010, we plan to 

collect regulatory fees from digital 

broadcasters. We seek comment on our 

plan to collect regulatory fees on fullpower digital broadcast stations 

beginning with FY 2010, i.e., the fiscal 

year after the nation-wide transition 

date on June 12, 2009. Our goal is to 

ensure that digital broadcasters will pay 

their share of regulatory fees in the years 

after the nation-wide transition is 

complete. Therefore, in FY 2010, we 

plan to collect regulatory fees from 

digital broadcasters. During this 

transitional year, we seek comment on 

our plan to collect regulatory fees from 

digital broadcasters beginning in FY 

2010, and whether an accompanying 

rule change is necessary. 

C. Commercial Mobile Radio Service 

Messaging Service 

8. Commercial Mobile Radio Service 

(‘‘CMRS’’) Messaging Services, which 

replaced the CMRS One-Way Paging fee 

category in FY 1997, includes all 

narrowband services.9 We have 

maintained the CMRS Messaging 

Service regulatory fee at the rate that 

was first established in FY 2002,10 $0.08 

per subscriber, because the subscriber 

base in this industry has declined 

significantly.11 We found that 

maintaining the CMRS Messaging 

regulatory fee rate at $0.08 per 

subscriber, rather than allowing it to 

increase, was the appropriate level of 

relief to be afforded to the messaging 

industry. We propose to maintain the 

messaging service regulatory fee at $0.08 

per subscriber. We seek comment on 

this proposal. 

D. International Bearer Circuits 

9. Under our current policy, 

International Bearer Circuits (‘‘IBC’’) 

fees are paid by facilities-based common 

carriers that have active (used or leased) 

international bearer circuits as of 

December 31 of the prior year in any 

terrestrial or satellite transmission 

facility for the provision of service to an 

end user or resale carrier, which 

includes active circuits to themselves or 

to their affiliates. Submarine cable 

operators pay IBC fees for common 

carrier and non-common carrier circuits 

based on a per system fee.12 Initially, in 

1994 when the Commission first 

established regulatory fees, it only 

required that terrestrial, satellite and 

submarine cable common carriers 

providing IBCs and non-common carrier 

submarine cable operators providing 

IBCs pay the regulatory fees.13 Since 

1997 operators of non-common carrier 

satellites also must pay a fee for each 

circuit sold or leased to any customer, 

including themselves or their affiliates, 

other than an international common 

carrier authorized by the Commission to 

provide U.S. international common 

carrier services.14

10. We propose to collect IBC 

regulatory fees in FY 2009 consistent 

with our current policy.15 In the FY 

2008 Report and Order, the Commission 

initiated a Further NPRM to review its 

regulatory fee methodology and explore 

ways to ‘‘comprehensively make the 

Commission’s regulatory fee process 

more equitable.’’ 16 We note that our 

review is continuing. On March 17, 

2009, we adopted the Submarine Cable 

Order, which made the methodology for 

calculating regulatory fees more 

equitable among international 

submarine cable operators, without 

distinguishing between common 

carriers and non-common carriers.17

That decision did not, however, 

substantively address the IBC fees for 

terrestrial operators.18 As part of our 

comprehensive effort to review our 

regulatory fees process for possible ways 

to make the process more equitable, we 

26332 Federal Register / Vol. 74, No. 104 / Tuesday, June 2, 2009 / Proposed Rules 

19A carrier may have both common carrier and 

non-common carrier circuits. 

20Terrestrial facilities, particularly microwave, 

may also be used on other short range international 

routes such as the U.S. Virgin Islands-British Virgin 

Islands and the American Samoa-Samoa routes. 

21See 2006 International Telecommunications 

Data, Strategic Analysis and Negotiations Division, 

Multilateral Negotiations and Industry Analysis 

Branch, International Bureau (August 2008); 

International Bureau Report: 2007 Section 43.61 

Circuit Status Report, Policy Division (March 2009). 

These reports, and reports from previous years, are 

available on the International Bureau Web site at 

http://www.fcc.gov/ib/. 

22Fee Filer can be accessed at http:// 

www.fcc.gov/fees/feefiler.html. 

23 Geostationary orbit space station (‘‘GSO’’) 

licensees received regulatory fee pre-bills for 

satellites that (1) were licensed by the Commission 

and operational on or before October 1 of the 

respective fiscal year; and (2) were not co-located 

with and technically identical to another 

operational satellite on that date (i.e., were not 

functioning as a spare satellite). Non-geostationary 

orbit space station (‘‘NGSO’’) licensees received 

regulatory fee pre-bills for systems that were 

licensed by the Commission and operational on or 

before October 1 of the respective fiscal year. 

24An assessment is a proposed statement of the 

amount of regulatory fees owed by an entity to the 

Commission (or proposed subscriber count to be 

ascribed for purposes of setting the entity’s 

regulatory fee) but it is not entered into the 

Commission’s accounting system as a current debt. 

A pre-bill is considered an account receivable in the 

Commission’s accounting system. Pre-bills reflect 

the amount owed and have a payment due date of 

the last day of the regulatory fee payment window. 

Consequently, if a pre-bill is not paid by the due 

date, it becomes delinquent and is subject to our 

debt collection procedures. See also 47 CFR 

1.1161(c), 1.1164(f)(5), and 1.1910. 

now seek comment on whether, 

beginning in FY 2010, carriers providing 

international service over terrestrial 

circuits also should pay IBC fees on 

non-common carrier circuits.19 Carriers 

primarily provide terrestrial 

international services through 

microwave and fiber links across the 

U.S.-Canada and U.S.-Mexico borders.20

Non-common carrier terrestrial circuits 

play an important role in the provision 

of international services on the U.S.- 

Canada and U.S.-Mexico routes. Due to 

their proximity to the United States, 

these two border countries are among 

the largest telecommunications routes, 

and the Commission regularly engages 

with counterparts in Canada and 

Mexico on a wide range of issues related 

to cross-border communications.21 If 

carriers were to pay regulatory fees for 

their non-common carrier terrestrial 

circuits, we note that this would not 

increase the total amount of IBC fees 

that need to be collected each year. 

E. Administrative and Operational 

Issues 

11. We seek comment on the 

administrative and operational 

processes used to collect the annual 

section 9 regulatory fees. These issues 

do not affect the amount of regulatory 

fees parties are obligated to submit; 

however, the administrative and 

operational issues affect the process of 

submitting payment. We invite 

comment on ways to improve these 

processes. 

1. Mandatory Use of Fee Filer 

12. In the past we have strongly 

encouraged regulatees to electronically 

file their regulatory fee payments via 

Fee Filer, instead of submitting payment 

with a completed hardcopy Form 159, 

Form 159–B, or Form 159–W.22

Although we have strongly urged the 

use of Fee Filer, we have not required 

it. This year, we seek comment on 

whether the Commission should require 

all regulatees to enter critical 

information in Fee Filer, even if they do 

not pay through Fee Filer. By entering 

the Fee Filer system, even if the 

regulatee does not pay electronically, 

certain information will be entered into 

our system by the regulatee, such as the 

FRN, a correct address, and key 

electronic data attributes such as a call 

sign, payment amount, fee code, and 

quantity of subscribers. By instituting a 

mandatory filing requirement (but not a 

mandatory electronic payment 

requirement), we believe this will 

reduce errors resulting from illegible 

handwriting on hardcopy Form 159’s as 

well as create an electronic record of 

licensees who have paid regulatory fees. 

For those licensees who use the 

Commission’s electronic payment 

system (also known as ‘‘Fee Filer’’), but 

who choose to mail in their payments 

using the Form 159–E voucher 

generated by Fee Filer, the Commission 

will have an electronic record of 

licensee payment attributes that are 

more easily traced than those payments 

that are simply mailed in with a 

hardcopy Form 159. Those who file and 

pay through Fee Filer are also certifying 

to the accuracy of their payment, their 

subscriber count, and their revenue 

amount. 

13. Although we do not propose at 

this time to require payment through 

Fee Filer, we strongly encourage 

regulatees to do so. There are many 

benefits: (1) Expeditious submission of 

payment; (2) no postage or courier costs; 

(3) fewer errors caused by illegible 

handwriting or payments submitted 

without an FRN number or the 

appropriate data attributes (e.g., payers 

will avoid false delinquencies due to 

payment submission errors); (4) 

improved recordkeeping and payment 

reconciliation; (5) reduced 

administrative burden on both licensees 

and on Commission staff trying to 

process regulatory fee payments; (6) less 

expensive than a wire transfer; and (7) 

a significant reduction in the use of 

payment remittance forms such as Form 

159–C’s submitted in support of a 

regulatory fee payment. These benefits 

will not only reduce the paper burden 

on licensees, but the administrative 

burden of preparing and mailing such 

documents. 

14. For regulatees who choose not to 

pay online, such as those licensees 

whose credit card transactions exceed 

$99,999.99, Fee Filer also provides an 

opportunity to make a payment using 

your bank account, also known as an 

Automated Clearing House (‘‘ACH’’) 

payment, or generating an electronic 

remittance voucher form (Form 159–E) 

that can be printed directly from Fee 

Filer and mailed in with a check. ACH 

payments do not have restrictions on 

the amount remitted. 

15. For the reasons given in 

paragraphs 18 through 20, we 

tentatively conclude that we should 

require regulatees to file key 

information into Fee Filer, even if they 

do not use Fee Filer to make their 

payment. In instances where payment 

cannot be made using Fee Filer, which 

include credit card transactions 

exceeding $99,999.99, wire transfers, 

and licensees wishing to pay using a 

check, we propose that those licensees 

still enter the Fee Filer system in order 

to generate a Form 159–E remittance 

voucher to accompany their payment. 

We seek comment on this proposal. 

Commenters opposing the mandatory 

Fee Filer requirement should provide 

the reasons for their argument, and 

should provide supporting facts and 

other data, particularly with respect to 

any claimed burdens of this approach. 

2. Notification and Collection of 

Regulatory Fees 

a. Pre-Bills 

16. In prior years, the Commission 

mailed pre-bills to licensees in select 

regulatory fee categories via surface 

mail—to interstate telecommunications 

service providers (‘‘ITSPs’’), 

Geostationary (‘‘GSO’’) and NonGeostationary (‘‘NGSO’’) satellite space 

station licensees,23 to holders of Cable 

Television Relay Service (‘‘CARS’’) 

licenses, and earth station licensees.24

The remaining regulatees do not receive 

pre-bills. Consistent with the 

Commission’s proposal to require 

mandatory use of Fee Filer above, prebill information would be loaded into 

Fee Filer for viewing, but would not be 

mailed directly to the licensee via 

surface mail. We seek comment on the 

impact of our proposal not to mail prebills to ITSP providers, GSO and NGSO 

Federal Register / Vol. 74, No. 104 / Tuesday, June 2, 2009 / Proposed Rules 26333 

25An assessment is a proposed statement of the 

amount of regulatory fees owed by an entity to the 

Commission (or proposed subscriber count to be 

ascribed for purposes of setting the entity’s 

regulatory fee) but it is not entered into the 

Commission’s accounting system as a current debt. 

26Some of those refinements have been to 

provide licensees with a Commission-authorized 

web site to update or correct any information 

concerning their facilities, and to amend their feeexempt status, if need be. Also, our notifications 

now provide licensees with a telephone number to 

call in the event that they need customer assistance. 

The notifications themselves have been refined so 

that licensees of fewer than four facilities receive 

individual fee assessment postcards for their 

facilities; whereas licensees of four or more 

facilities now receive a single assessment letter that 

lists all of their facilities and the associated 

regulatory fee obligation for each facility. 27We again propose to issue fee assessments for 

AM and FM Radio Stations, AM and FM 

Construction Permits, FM Translators/Boosters, 

VHF and UHF Television Stations, VHF and UHF 

Television Construction Permits, Satellite 

Television Stations, Low Power Television 

(‘‘LPTV’’) Stations and LPTV Translators/Boosters, 

to the extent that applicants, permittees and 

licensees of such facilities do not qualify as 

government entities or non-profit entities. Fee 

assessments have not been issued for broadcast 

auxiliary stations in prior years, nor will they be 

issued in FY 2009. 28 If there is a change of address for the facility, 

it is the licensee’s responsibility to make the 

address change in the Media Bureau’s CDBS 

system, as well as in the Commission’s Registration 

System (‘‘CORES’’). The Commission-authorized 

web site for media services licensees is http:// 

www.fccfees.com. 

29See Assessment and Collection of Regulatory 

Fees for Fiscal Year 2005 and Assessment and 

Collection of Regulatory Fees for Fiscal Year 2004, 

MD Docket Nos. 05–59 and 04–73, Report and 

Order and Order on Reconsideration, 20 FCC Rcd 

12259, 12264, paragraphs 38–44 (2005). 30 Id. 31See, e.g., Federal Communications 

Commission, Regulatory Fees Fact Sheet: What You 

Owe—Commercial Wireless Services for FY 2008 at 

1 (rel. Aug. 2008). 

licensees, CARS licensees, and earth 

station licensees. 

b. Future Streamlining of the Regulatory 

Fee Assessment and Collection Process 

17. We continue to welcome 

comments concerning our commitment 

to reviewing, streamlining, and 

modernizing our statutorily required fee 

assessment and collection procedures. 

Our areas of particular interest include: 

(1) The process for notifying licensees 

about changes in the annual Schedule of 

Regulatory Fees and how it can be 

improved; (2) the most effective way to 

disseminate regulatory fee assessments 

and bills, e.g., through surface mail, email, list server using Listserv, online 

Web site, or some other mechanism; (3) 

the fee payment process, including how 

the agency’s online regulatory fee filing 

system (Fee Filer) can be enhanced; (4) 

the timing of fee payments, including 

whether we should alter the existing 

section 9 regulatory fee payment 

window in any way; and (5) the timing 

of fee assessments and notifications. 

III. Procedural Matters 

18. Below are our current payment 

and collection procedures that we have 

revised over the past several years to 

expedite the processing of regulatory fee 

payments. We include these procedures 

here as a useful way to remind 

regulatory fee payers and the public 

about these aspects of the annual 

regulatory fee collection process. 

A. Public Notices and Fact Sheets 

19. Each year we post public notices 

and fact sheets pertaining to regulatory 

fees on our Web site. These documents 

contain information about the payment 

due date and the regulatory fee payment 

procedures. We will continue to post 

this information on http://www.fcc.gov/ 

fees/regfees.html, but will not send out 

public notices and fact sheets to 

regulatees en masse. 

B. Assessment Notifications 

1. Media Services Licensees 

20. Beginning in FY 2003, we sent fee 

assessment notifications via surface 

mail to media services entities on a perfacility basis.25 The notifications 

provided the assessed fee amount for 

the facility in question, as well as the 

data attributes that determined the fee 

amount. We have since refined this 

initiative with improved results.26

Consistent with procedures used last 

year, we will continue our notification 

assessment initiative in FY 2009 and 

mail media assessment notifications to 

licensees at their primary record of 

contact populated in our Consolidated 

Database System (‘‘CDBS’’), and to a 

secondary record of contact, if 

available.27 We will also continue to 

make the Commission-authorized Web 

site available to licensees so that they 

can update or correct any information 

regarding their facilities and their feeexempt status.28

21. Although the Commission will 

continue to mail media assessment 

notifications, there is a proposal in this 

Notice of Proposed Rulemaking to 

institute a mandatory use of the 

Commission’s online payment system 

(‘‘Fee Filer’’), which if adopted, will 

require all media service licensees to 

use Fee Filer as the first step to paying 

their regulatory fee obligations. The 

notification assessments are primarily 

intended to provide licensees with 

media data attributes, and are not 

intended to be used as a substitute for 

a remittance voucher when making a 

payment. Licensees wishing to pay by 

check or money order must first log onto 

the Commission’s Fee Filer system and 

generate a Form 159–E directly from Fee 

Filer before mailing in their payment 

along with their Form 159–E. 

2. CMRS Cellular and Mobile Services 

Assessments 

22. As we have done in prior years, 

we will continue to mail an assessment 

letter to CMRS providers using data 

from the Numbering Resource 

Utilization Forecast (‘‘NRUF’’) report 

that is based on ‘‘assigned’’ number 

counts that have been adjusted for 

porting to net Type 0 ports (‘‘in’’ and 

‘‘out’’).29 This letter will include a 

listing of the carrier’s Operating 

Company Numbers (‘‘OCNs’’) upon 

which the assessment is based.30 The 

letters will not include OCNs with their 

respective assigned number counts, but 

rather, an aggregate total of assigned 

numbers for each carrier. 

23. We will also continue our 

procedure of giving entities an 

opportunity to revise their subscriber 

counts by sending an initial and a final 

assessment letter. If the carrier does not 

agree with the number of subscribers 

listed on the initial assessment letter, 

the carrier can correct its subscriber 

count by returning the initial 

assessment letter or by contacting the 

Commission and stating a reason for the 

change (e.g., a purchase or sale of a 

subsidiary), the date of the transaction, 

and any other pertinent information that 

will help to justify a reason for the 

change. If we receive no response or 

correction to our initial assessment 

letter, we will expect the fee payment to 

be based on the number of subscribers 

listed on the initial assessment. We will 

review all responses to the initial 

assessment letters and determine 

whether a change in the number of 

subscribers is warranted. The final 

assessment letter will inform carriers as 

to whether we have accepted their 

revision in the number of subscribers. 

24. Because some carriers do not file 

the NRUF report, they may not receive 

a letter of assessment. In these 

instances, the carriers should compute 

their fee payment using the standard 

methodology 31 that is currently in place 

for CMRS Wireless services (e.g., 

compute their subscriber counts as of 

December 31, 2008), and submit their 

fee payment accordingly. Whether a 

carrier receives an assessment letter or 

not, the Commission reserves the right 

to audit the number of subscribers for 

which regulatory fees are paid. In the 

event that the Commission determines 

that the number of subscribers is 

inaccurate or that an insufficient reason 

is given for making a correction on the 

26334 Federal Register / Vol. 74, No. 104 / Tuesday, June 2, 2009 / Proposed Rules 

32See Assessment and Collection of Regulatory 

Fees for Fiscal Year 2006, MD Docket No. 06–68, 

Report and Order, 21 FCC Rcd 8092, 8105, 

paragraph 48 (2006). 

33Audio bridging services are toll 

teleconferencing services, and audio bridging 

service providers are required to contribute directly 

to the universal service fund based on revenues 

from these services. On June 30, 2008, the 

Commission released the InterCall Order, in which 

the Commission stated that InterCall, Inc. and all 

similarly situated audio bridging service providers 

are required to contribute directly to the universal 

service fund. See Request for Review by InterCall, 

Inc. of Decision of Universal Service Administrator, 

CC Docket No. 96–45, Order, 23 FCC Rcd 10731 

(2008) (‘‘InterCall Order’’). 

34Cable television system operators should 

compute their basic subscribers as follows: Number 

of single family dwellings + number of individual 

households in multiple dwelling units (apartments, 

condominiums, mobile home parks, etc.) paying at 

the basic subscriber rate + bulk-rate customers + 

courtesy and free service. Note: Bulk-Rate 

Customers = Total annual bulk-rate charge divided 

by basic annual subscription rate for individual 

households. Operators may base their count on ‘‘a 

typical day in the last full week’’ of December 2008, 

rather than on a count as of December 31, 2008. 

initial assessment letter, the 

Commission will assess the carrier for 

the difference between what was paid 

and what should have been paid. 

C. Streamlined Regulatory Fee Payment 

Process 

1. Cable Television Subscribers 

25. We will continue to permit cable 

television operators to base their 

regulatory fee payment on their 

company’s aggregate year-end 

subscriber count, rather than requiring 

them to sub-report subscriber counts on 

a per community unit identifier 

(‘‘CUID’’) basis. 

2. CMRS Cellular and Mobile Providers 

26. In FY 2006, we streamlined the 

CMRS payment process by eliminating 

the requirement for CMRS providers to 

identify their individual calls signs 

when making their regulatory fee 

payment, requiring instead for CMRS 

providers to pay their regulatory fees 

only at the aggregate subscriber level 

without having to identify their various 

call signs.32 We will continue this 

practice in FY 2009. In FY 2007, we 

consolidated the CMRS cellular and 

CMRS mobile fee categories into one fee 

category and as one fee code, thereby 

eliminating the requirement for CMRS 

providers to separate their subscriber 

counts into CMRS cellular and CMRS 

mobile fee categories during the 

regulatory fee payment process. This 

consolidation of fee categories enabled 

the Commission to process payments 

more quickly and accurately. For FY 

2009, we will continue this practice of 

combining the CMRS cellular and 

CMRS mobile fee categories into one 

regulatory fee category. 

3. Interstate Telecommunications 

Service Providers (‘‘ITSP’’) 

27. In FY 2007, we adopted a proposal 

to round lines 14 (total subject 

revenues) and 16 (total regulatory fee 

owed) on FCC Form 159–W to the 

nearest dollar. This revision enabled the 

Commission to process the ITSP 

regulatory fee payments more quickly 

because rounding was no longer a 

hindrance that slowed the processing of 

payments. In FY 2008, we continued to 

round lines 14 and 16 on FCC Form 

159–W to the nearest dollar. We will 

continue rounding lines 14 and 16 when 

calculating the FY 2009 ITSP fee 

obligation. 

D. Payment of Regulatory Fees 

1. Lock Box Bank 

28. All lock box payments to the 

Commission for FY 2009 will be 

processed by U.S. Bank, St. Louis, 

Missouri, and payable to the FCC. For 

all regulatory fees, the address is: 

Federal Communications Commission, 

Regulatory Fees, P.O. Box 979084, St. 

Louis, MO 63197–9000. 

2. Receiving Bank for Wire Payments 

29. The receiving bank for all wire 

payments is the Federal Reserve Bank, 

New York, New York (TREAS NYC). 

When making a wire transfer, regulatees 

must fax a copy of their completed 

remittance instrument to U.S. Bank, St. 

Louis, Missouri at (314) 418–4232 at 

least one hour before initiating the wire 

transfer (but on the same business day), 

so as to not delay crediting their 

account. Wire transfers initiated after 

6:00 p.m. (EDT) will be credited the 

next business day. Complete 

instructions for making wire payments 

are posted at http://www.fcc.gov/fees/ 

wiretran.html. 

3. De Minimis Regulatory Fees 

30. Regulatees whose total FY 2009 

regulatory fee liability, including all 

categories of fees for which payment is 

due, is less than $10 are exempted from 

payment of FY 2009 regulatory fees. 

4. Standard Fee Calculations and 

Payment Dates 

31. The Commission will accept fee 

payments made in advance of the 

window for the payment of regulatory 

fees. The responsibility for payment of 

fees by service category is as follows: 

• Media Services: Regulatory fees 

must be paid for initial construction 

permits that were granted on or before 

October 1, 2008 for AM/FM radio 

stations, analog VHF/UHF full service 

television stations (including full 

service digital-only stations that were 

licensed as of October 1, 2008), and 

satellite television stations. Regulatory 

fees must be paid for all broadcast 

facility licenses granted on or before 

October 1, 2008. In instances where a 

permit or license is transferred or 

assigned after October 1, 2008, 

responsibility for payment rests with the 

holder of the permit or license as of the 

fee due date. 

• Wireline (Common Carrier) 

Services: Regulatory fees must be paid 

for authorizations that were granted on 

or before October 1, 2008. In instances 

where a permit or license is transferred 

or assigned after October 1, 2008, 

responsibility for payment rests with the 

holder of the permit or license as of the 

fee due date. We note that audio 

bridging service providers are included 

in this category.33

• Wireless Services: CMRS cellular, 

mobile, and messaging services (fees 

based on number of subscribers or 

telephone number count): Regulatory 

fees must be paid for authorizations that 

were granted on or before October 1, 

2008. The number of subscribers, units, 

or telephone numbers on December 31, 

2008 will be used as the basis from 

which to calculate the fee payment. 

• The first eleven regulatory fee 

categories in our Schedule of Regulatory 

Fees pay ‘‘small multi-year wireless 

regulatory fees.’’ Entities pay these 

regulatory fees in advance for the entire 

amount of their five-year or ten-year 

term of initial license, and only pay 

regulatory fees again when the license is 

renewed or a new license is obtained. 

We include these fee categories in our 

Schedule of Regulatory Fees to 

publicize our estimates of the number of 

‘‘small multi-year wireless’’ licenses 

that will be renewed or newly obtained 

in FY 2009. 

• Multichannel Video Programming 

Distributor Services (cable television 

operators and CARS licensees): 

Regulatory fees must be paid for the 

number of basic cable television 

subscribers as of December 31, 2008.34

Regulatory fees also must be paid for 

CARS licenses that were granted on or 

before October 1, 2008. In instances 

where a CARS license is transferred or 

assigned after October 1, 2008, 

responsibility for payment rests with the 

holder of the license as of the fee due 

date. 

• International Services: Regulatory 

fees must be paid for earth stations, 

geostationary orbit space stations and 

non-geostationary orbit satellite systems 

that were licensed and operational on or 

Federal Register / Vol. 74, No. 104 / Tuesday, June 2, 2009 / Proposed Rules 26335 

35See Submarine Cable Order. 

36 47 U.S.C. 159(c). 

37See 47 CFR 1.1910. 

38 Delinquent debt owed to the Commission 

triggers application of the ‘‘red light rule’’ which 

requires offsets or holds on pending disbursements. 

47 CFR 1.1910. In 2004, the Commission adopted 

rules implementing the requirements of the DCIA. 

See Amendment of Parts 0 and 1 of the 

Commission’s Rules, MD Docket No. 02–339, Report 

and Order, 19 FCC Rcd 6540 (2004); 47 CFR Part 

1, Subpart O, Collection of Claims Owed the United 

States. 

39 47 CFR 1.1940(d). 

40See 47 CFR 1.1161(c), 1.1164(f)(5), and 1.1910. 

41 44 U.S.C. 3507(d). 

42See 47 CFR 1.1206(b); see also 47 CFR 1.1202, 

1.1203. 

43See 47 CFR 1.1206(b)(2). 

44See 47 CFR 1.415, 1.419. 

45See Electronic Filing of Documents in 

Rulemaking Proceedings, 13 FCC Rcd 11322 (1998). 

before October 1, 2008. In instances 

where a license is transferred or 

assigned after October 1, 2008, 

responsibility for payment rests with the 

holder of the license as of the fee due 

date. Regulatory fees will be paid for 

international bearer circuits under our 

newly adopted methodology pending a 

90-day Congressional notification for 

this permitted amendment; 35 if for any 

reason the methodology change is not 

instituted in FY 2009, the pre-FY 2009 

methodology will be used to calculate 

FY 2009 bearer circuit regulatory fees. 

E. Enforcement 

32. Regulatory fee payment must be 

received and stamped at the lockbox 

bank by the last day of the regulatory fee 

filing window to be considered timely. 

Section 9(c) of the Act requires us to 

impose an additional charge as a 

penalty for late payment of any 

regulatory fee.36 A late payment penalty 

of 25 percent of the amount of the 

required regulatory fee will be assessed 

on the first day following the deadline 

date for filing of these fees. Failure to 

pay regulatory fees and/or any late 

penalty will subject regulatees to 

sanctions, including the Commission’s 

Red Light Rule 37 and the provisions set 

forth in the Debt Collection 

Improvement Act of 1996 (‘‘DCIA’’).38

We also assess administrative 

processing charges on delinquent debts 

to recover additional costs incurred in 

processing and handling the related 

debt pursuant to the DCIA and section 

1.1940(d) of the Commission’s rules.39

These administrative processing charges 

will be assessed on any delinquent 

regulatory fee, in addition to the 25 

percent late charge penalty. In case of 

partial payments (underpayments) of 

regulatory fees, the licensee will be 

given credit for the amount paid, but if 

it is later determined that the fee paid 

is incorrect or not timely paid, then the 

25 percent late charge penalty (and 

other charges and/or sanctions, as 

appropriate) will be assessed on the 

portion that is not paid in a timely 

manner. 

33. We will withhold action on any 

applications or other requests for 

benefits filed by anyone who is 

delinquent in any non-tax debts owed to 

the Commission (including regulatory 

fees) and will ultimately dismiss those 

applications or other requests if 

payment of the delinquent debt or other 

satisfactory arrangement for payment is 

not made.40 Failure to pay regulatory 

fees can also result in the initiation of 

a proceeding to revoke any and all 

authorizations held by the entity 

responsible for paying the delinquent 

fee(s). 

F. Final Regulatory Flexibility 

Certification 

34. A final regulatory flexibility 

certification for the changes adopted in 

the Order herein is contained in this 

document. The Commission will send a 

copy of the Order, including the final 

regulatory flexibility certification, to the 

Chief Counsel for Advocacy of the Small 

Business Administration. 

G. Initial Regulatory Flexibility Analysis 

35. An initial regulatory flexibility 

analysis (‘‘IRFA’’) is contained in this 

document. Comments to the IRFA must 

be identified as responses to the IRFA 

and filed by the deadlines for comments 

on this NPRM. The Commission will 

send a copy of this NPRM, including the 

IRFA, to the Chief Counsel for Advocacy 

of the Small Business Administration. 

H. Congressional Review Act Analysis 

36. The Commission will send a copy 

of this Notice of Proposed Rulemaking 

and Order to Congress and the 

Government Accountability Office 

pursuant to the Congressional Review 

Act, see 5 U.S.C. 801(a)(1)(A). 

I. Initial Paperwork Reduction Act 

Analysis 

37. This Report and Order contains 

modified information collection 

requirements subject to the Paperwork 

Reduction Act of 1995 (‘‘PRA’’), Public 

Law 104–13. It will be submitted to the 

Office of Management and Budget 

(‘‘OMB’’) for review under section 

3507(d) of the PRA.41 Our proposed new 

form for submarine cable operators is 

contained in this document. OMB, the 

general public, and other Federal 

agencies are invited to comment on the 

new or modified information collection 

requirements contained in this 

proceeding. In addition, we note that 

pursuant to the Small Business 

Paperwork Relief Act of 2002, Public 

Law 107–198, see 44 U.S.C. 3506(c)(4), 

we previously sought specific comment 

on how the Commission might ‘‘further 

reduce the information collection 

burden for small business concerns with 

fewer than 25 employees.’’ 

J. Ex Parte Rules 

38. This is as a ‘‘permit-but-disclose’’ 

proceeding subject to the requirements 

under section 1.1206(b) of the 

Commission’s rules.42 Ex parte 

presentations are permissible if 

disclosed in accordance with 

Commission rules, except during the 

Sunshine Agenda period when 

presentations, ex parte or otherwise, are 

generally prohibited. Persons making 

oral ex parte presentations are reminded 

that a memorandum summarizing a 

presentation must contain a summary of 

the substance of the presentation and 

not merely a listing of the subjects 

discussed. More than a one- or twosentence description of the views and 

arguments presented is generally 

required.43 Additional rules pertaining 

to oral and written presentations are set 

forth in section 1.1206(b). 

K. Filing Requirements 

39. Comments and Replies. Pursuant 

to sections 1.415 and 1.419 of the 

Commission’s rules,44 interested parties 

may file comments under MD Docket 

No. 09–65 on or before the dates 

indicated on the first page of this 

document. Comments may be filed 

using: (1) The Commission’s Electronic 

Comment Filing System (‘‘ECFS’’), (2) 

the Federal Government’s eRulemaking 

Portal, or (3) procedures for filing paper 

copies.45

40. Electronic Filers: Comments may 

be filed electronically using the Internet 

by accessing the ECFS: http:// 

www.fcc.gov/cgb/ecfs or the Federal 

eRulemaking Portal: http:// 

www.regulations.gov. Filers should 

follow the instructions provided on the 

web site for submitting comments. For 

ECFS filers, if multiple docket or 

rulemaking numbers appear in the 

caption of this proceeding, filers must 

transmit one electronic copy of the 

comments for each docket or 

rulemaking number referenced in the 

caption. In completing the transmittal 

screen, filers should include their full 

name, U.S. Postal Service mailing 

address, and the applicable docket or 

rulemaking number. Parties may also 

submit an electronic comment by 

Internet e-mail. To get filing 

instructions, filers should send an email to ecfs@fcc.gov, and include the 

26336 Federal Register / Vol. 74, No. 104 / Tuesday, June 2, 2009 / Proposed Rules 

46 5 U.S.C. 603. The RFA, 5 U.S.C. 601–612 has 

been amended by the Contract With America 

Advancement Act of 1996, Public Law 104–121, 

110 Stat. 847 (1996) (‘‘CWAAA’’). Title II of the 

CWAAA is the Small Business Regulatory 

Enforcement Fairness Act of 1996 (‘‘SBREFA’’). 

47 5 U.S.C. 603(a). 

48 Id. 

49 47 U.S.C. 154(i) and (j), 159, and 303(r). 

50 5 U.S.C. 603(b)(3). 

51 5 U.S.C. 601(6). 

52 5 U.S.C. 601(3) (incorporating by reference the 

definition of ‘‘small-business concern’’ in the Small 

Business Act, 15 U.S.C. 632). Pursuant to 5 U.S.C. 

601(3), the statutory definition of a small business 

applies ‘‘unless an agency, after consultation with 

the Office of Advocacy of the Small Business 

Administration and after opportunity for public 

comment, establishes one or more definitions of 

such term which are appropriate to the activities of 

the agency and publishes such definition(s) in the 

Federal Register.’’ 

53 15 U.S.C. 632. 

54See SBA, Programs and Services, SBA 

Pamphlet No. CO–0028, at p. 40 (July 2002). 

55 Independent Sector, The New Nonprofit 

Almanac & Desk Reference (2002). 

56 5 U.S.C. 601(5). 

57U.S. Census Bureau, Statistical Abstract of the 

United States: 2006, Section 8, p. 272, Table 415. 

58We assume that the villages, school districts, 

and special districts are small, and total 48,558. See 

U.S. Census Bureau, Statistical Abstract of the 

United States: 2006, Section 8, p. 273, Table 417. 

For 2002, Census Bureau data indicate that the total 

number of county, municipal, and township 

following words in the body of the 

message, ‘‘get form.’’ A sample form and 

directions will be sent in response. 

41. Paper Filers: 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, filers must submit two 

additional copies for each additional 

docket or rulemaking number. Filings 

can be sent by hand or messenger 

delivery, by commercial overnight 

courier, or by first-class or overnight 

U.S. Postal Service mail (although we 

continue to experience delays in 

receiving U.S. Postal Service mail). All 

filings must be addressed to the 

Commission’s Secretary, Office of the 

Secretary, Federal Communications 

Commission. 

• The Commission’s contractor will 

receive hand-delivered or messengerdelivered paper filings for the 

Commission’s Secretary at 236 

Massachusetts Avenue, NE., Suite 110, 

Washington, DC 20002. The filing hours 

at this location are 8:00 a.m. to 7:00 p.m. 

All hand deliveries must be held 

together with rubber bands or fasteners. 

Any envelopes must be disposed of 

before entering the building. 

• Commercial overnight mail (other 

than U.S. Postal Service Express Mail 

and Priority Mail) must be sent to 9300 

East Hampton Drive, Capitol Heights, 

MD 20743. 

• U.S. Postal Service first-class, 

Express, and Priority mail should be 

addressed to 445 12th Street, SW., 

Washington, DC 20554. 

42. Availability of Documents. 

Comments, reply comments, and ex 

parte submissions will be available for 

public inspection during regular 

business hours in the FCC Reference 

Center, Federal Communications 

Commission, 445 12th Street, SW., CY– 

A257, Washington, DC 20554. These 

documents will also be available free 

online, via ECFS. Documents will be 

available electronically in ASCII, Word, 

and/or Adobe Acrobat. 

43. Accessibility Information. To 

request information in accessible 

formats (computer diskettes, large print, 

audio recording, and Braille), send an email to fcc504@fcc.gov or call the 

Commission’s Consumer and 

Governmental Affairs Bureau at (202) 

418–0530 (voice), (202) 418–0432 

(TTY). This document can also be 

downloaded in Word and Portable 

Document Format (‘‘PDF’’) at: http:// 

www.fcc.gov. 

IV. Ordering Clauses 

44. Accordingly, it is ordered that, 

pursuant to sections 4(i) and (j), 9, and 

303(r) of the Communications Act of 

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

154(j), 159, and 303(r), this Notice of 

Proposed Rulemaking and Order is 

hereby adopted. 

45. It is further ordered that Part 1 of 

the Commission’s Rules are amended as 

set forth herein, and these rules shall 

become effective 90 days after 

Congressional notification. 

46. It is further ordered that the 

Commission’s Consumer and 

Governmental Affairs Bureau, Reference 

Information Center, shall send a copy of 

this Notice of Proposed Rulemaking and 

Order, including the Final Regulatory 

Flexibility Certification and Initial 

Regulatory Flexibility Analysis, to the 

Chief Counsel for Advocacy of the U.S. 

Small Business Administration. 

Initial Regulatory Flexibility Analysis 

47. As required by the Regulatory 

Flexibility Act (‘‘RFA’’),46 the 

Commission has prepared this Initial 

Regulatory Flexibility Analysis 

(‘‘IRFA’’) of the possible significant 

economic impact on small entities by 

the policies and rules in the present 

NPRM. Written public comments are 

requested on this IRFA. Comments must 

be identified as responses to the IRFA 

and must be filed on or before the dates 

indicated on the first page of this 

NPRM. The Commission will send a 

copy of this NPRM, including the IRFA, 

to the Chief Counsel for Advocacy of the 

Small Business Administration.47 In 

addition, the NPRM and IRFA (or 

summaries thereof) will be published in 

the Federal Register.48

I. Need for, and Objectives of, the 

Proposed Rules 

48. This rulemaking proceeding is 

initiated to obtain comments concerning 

the Commission’s proposed amendment 

of its Schedule of Regulatory Fees in the 

amount of $341,875,000, the amount 

that Congress has required the 

Commission to recover. The 

Commission seeks to collect the 

necessary amount through its proposed 

Schedule of Regulatory Fees in the most 

efficient manner possible and without 

undue public burden. 

II. Legal Basis 

49. This action, including publication 

of proposed rules, is authorized under 

sections (4)(i) and (j), 9, and 303(r) of 

the Communications Act of 1934, as 

amended.49

III. Description and Estimate of the 

Number of Small Entities to Which the 

Proposed Rules Will Apply 

50. The RFA directs agencies to 

provide a description of, and where 

feasible, an estimate of the number of 

small entities that may be affected by 

the proposed rules and policies, if 

adopted.50 The RFA generally defines 

the term ‘‘small entity’’ as having the 

same meaning as the terms ‘‘small 

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

‘‘small governmental jurisdiction.’’ 51 In 

addition, the term ‘‘small business’’ has 

the same meaning as the term ‘‘small 

business concern’’ under the Small 

Business Act.52 A ‘‘small business 

concern’’ is one which: (1) Is 

independently owned and operated; (2) 

is not dominant in its field of operation; 

and (3) satisfies any additional criteria 

established by the SBA.53

51. Small Businesses. Nationwide, 

there are a total of 22.4 million small 

businesses, according to SBA data.54

52. Small Organizations. Nationwide, 

there are approximately 1.6 million 

small organizations.55

53. Small Governmental Jurisdictions. 

The term ‘‘small governmental 

jurisdiction’’ is defined generally as 

‘‘governments of cities, towns, 

townships, villages, school districts, or 

special districts, with a population of 

less than fifty thousand.’’ 56 Census 

Bureau data for 2002 indicate that there 

were 87,525 local governmental 

jurisdictions in the United States.57 We 

estimate that, of this total, 84,377 

entities were ‘‘small governmental 

jurisdictions.’’ 58 Thus, we estimate that 

Federal Register / Vol. 74, No. 104 / Tuesday, June 2, 2009 / Proposed Rules 26337 

governments nationwide was 38,967, of which 

35,819 were small. Id. 

59 15 U.S.C. 632. 

60Letter from Jere W. Glover, Chief Counsel for 

Advocacy, SBA, to William E. Kennard, Chairman, 

FCC (May 27, 1999). The Small Business Act 

contains a definition of ‘‘small-business concern,’’ 

which the RFA incorporates into its own definition 

of ‘‘small business.’’ See 15 U.S.C. 632(a) (‘‘Small 

Business Act’’); 5 U.S.C. 601(3) (‘‘RFA’’). SBA 

regulations interpret ‘‘small business concern’’ to 

include the concept of dominance on a national 

basis. See 13 CFR 121.102(b). 

61 13 CFR 121.201, North American Industry 

Classification System (NAICS) code 517110. 

62FCC, Wireline Competition Bureau, Industry 

Analysis and Technology Division, ‘‘Trends in 

Telephone Service’’ at Table 5.3, Page 5–5 (Aug. 

2008) (‘‘Trends in Telephone Service’’). 

63 13 CFR 121.201, NAICS code 517110. 

64 ‘‘Trends in Telephone Service’’ at Table 5.3. 

65 13 CFR 121.201, NAICS code 517310. 

66 ‘‘Trends in Telephone Service’’ at Table 5.3. 

67 13 CFR 121.201, NAICS code 517310. 

68 ‘‘Trends in Telephone Service’’ at Table 5.3. 

69 3 CFR 121.201, NAICS code 517110. 

70 ‘‘Trends in Telephone Service’’ at Table 5.3. 

71 13 CFR 121.201, NAICS code 517110. 

72 ‘‘Trends in Telephone Service’’ at Table 5.3. 

73 13 CFR 121.201, NAICS code 517110. 

74 ‘‘Trends in Telephone Service’’ at Table 5.3. 

most governmental jurisdictions are 

small. 

54. We have included small 

incumbent local exchange carriers in 

this present RFA analysis. As noted 

above, 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.’’ 59 The SBA’s Office 

of Advocacy contends that, for RFA 

purposes, small incumbent local 

exchange carriers are not dominant in 

their field of operation because any such 

dominance is not ‘‘national’’ in scope.60

We have therefore included small 

incumbent local exchange carriers in 

this RFA analysis, although we 

emphasize that this RFA action has no 

effect on Commission analyses and 

determinations in other, non-RFA 

contexts. 

55. Incumbent Local Exchange 

Carriers (‘‘ILECs’’). Neither the 

Commission nor the SBA has developed 

a small business size standard 

specifically for incumbent local 

exchange services. The appropriate size 

standard under SBA rules is for the 

category Wired Telecommunications 

Carriers. Under that size standard, such 

a business is small if it has 1,500 or 

fewer employees.61 According to 

Commission data,62 1,311 carriers have 

reported that they are engaged in the 

provision of incumbent local exchange 

services. Of these 1,311 carriers, an 

estimated 1,024 have 1,500 or fewer 

employees and 287 have more than 

1,500 employees. Consequently, the 

Commission estimates that most 

providers of incumbent local exchange 

service are small businesses that may be 

affected by our proposed action. 

56. Competitive Local Exchange 

Carriers (‘‘CLECs’’), Competitive Access 

Providers (‘‘CAPs’’), ‘‘Shared-Tenant 

Service Providers,’’ and ‘‘Other Local 

Service Providers.’’ Neither the 

Commission nor the SBA has developed 

a small business size standard 

specifically for these service providers. 

The appropriate size standard under 

SBA rules is for the category Wired 

Telecommunications Carriers. Under 

that size standard, such a business is 

small if it has 1,500 or fewer 

employees.63 According to Commission 

data,64 1,005 carriers have reported that 

they are engaged in the provision of 

either competitive access provider 

services or competitive local exchange 

carrier services. Of these 1,005 carriers, 

an estimated 918 have 1,500 or fewer 

employees and 87 have more than 1,500 

employees. In addition, 16 carriers have 

reported that they are ‘‘Shared-Tenant 

Service Providers,’’ and all 16 are 

estimated to have 1,500 or fewer 

employees. In addition, 89 carriers have 

reported that they are ‘‘Other Local 

Service Providers.’’ Of the 89, all have 

1,500 or fewer employees. 

Consequently, the Commission 

estimates that most providers of 

competitive local exchange service, 

competitive access providers, ‘‘SharedTenant Service Providers,’’ and ‘‘Other 

Local Service Providers’’ are small 

entities that may be affected by our 

proposed action. 

57. Local Resellers. The SBA has 

developed a small business size 

standard for the category of 

Telecommunications Resellers. Under 

that size standard, such a business is 

small if it has 1,500 or fewer 

employees.65 According to Commission 

data,66 151 carriers have reported that 

they are engaged in the provision of 

local resale services. Of these, an 

estimated 149 have 1,500 or fewer 

employees and two have more than 

1,500 employees. Consequently, the 

Commission estimates that the majority 

of local resellers are small entities that 

may be affected by our proposed action. 

58. Toll Resellers. The SBA has 

developed a small business size 

standard for the category of 

Telecommunications Resellers. Under 

that size standard, such a business is 

small if it has 1,500 or fewer 

employees.67 According to Commission 

data,68 815 carriers have reported that 

they are engaged in the provision of toll 

resale services. Of these, an estimated 

787 have 1,500 or fewer employees and 

28 have more than 1,500 employees. 

Consequently, the Commission 

estimates that the majority of toll 

resellers are small entities that may be 

affected by our proposed action. 

59. Payphone Service Providers 

(‘‘PSPs’’). Neither the Commission nor 

the SBA has developed a small business 

size standard specifically for payphone 

services providers. The appropriate size 

standard under SBA rules is for the 

category Wired Telecommunications 

Carriers. Under that size standard, such 

a business is small if it has 1,500 or 

fewer employees.69 According to 

Commission data,70 526 carriers have 

reported that they are engaged in the 

provision of payphone services. Of 

these, an estimated 524 have 1,500 or 

fewer employees and two have more 

than 1,500 employees. Consequently, 

the Commission estimates that the 

majority of payphone service providers 

are small entities that may be affected 

by our proposed action. 

60. Interexchange Carriers (‘‘IXCs’’). 

Neither the Commission nor the SBA 

has developed a small business size 

standard specifically for providers of 

interexchange services. The appropriate 

size standard under SBA rules is for the 

category Wired Telecommunications 

Carriers. Under that size standard, such 

a business is small if it has 1,500 or 

fewer employees.71 According to 

Commission data,72 300 carriers have 

reported that they are engaged in the 

provision of interexchange services. Of 

these, an estimated 268 have 1,500 or 

fewer employees and 32 have more than 

1,500 employees. Consequently, the 

Commission estimates that the majority 

of IXCs are small entities that may be 

affected by our proposed action. 

61. Operator Service Providers 

(‘‘OSPs’’). Neither the Commission nor 

the SBA has developed a small business 

size standard specifically for operator 

service providers. The appropriate size 

standard under SBA rules is for the 

category Wired Telecommunications 

Carriers. Under that size standard, such 

a business is small if it has 1,500 or 

fewer employees.73 According to 

Commission data,74 28 carriers have 

reported that they are engaged in the 

provision of operator services. Of these, 

an estimated 27 have 1,500 or fewer 

employees and one has more than 1,500 

employees. Consequently, the 

Commission estimates that the majority 

of OSPs are small entities that may be 

affected by our proposed action. 

62. Prepaid Calling Card Providers. 

Neither the Commission nor the SBA 

26338 Federal Register / Vol. 74, No. 104 / Tuesday, June 2, 2009 / Proposed Rules 

75 13 CFR 121.201, NAICS code 517310. 76 ‘‘Trends in Telephone Service’’ at Table 5.3. 77We include all toll-free number subscribers in 

this category. 78 13 CFR 121.201, NAICS code 517310. 79 ‘‘Trends in Telephone Service’’ at Tables 18.4, 

18.5, 18.6, and 18.7. 

80 13 CFR 121.201, NAICS codes 517410 and 

517910. 

81U.S. Census Bureau, 2002 NAICS Definitions, 

‘‘517410 Satellite Telecommunications’’; http:// 

www.census.gov/epcd/naics02/def/NDEF517.HTM. 

82U.S. Census Bureau, 2002 Economic Census, 

Subject Series: Information, ‘‘Establishment and 

Firm Size (Including Legal Form of Organization),’’ 

Table 4, NAICS code 517410. 

83 Id. An additional 38 firms had annual receipts 

of $25 million or more. 

84U.S. Census Bureau, 2002 NAICS Definitions, 

‘‘517910 Other Telecommunications’’; http:// 

www.census.gov/epcd/naics02/def/NDEF517.HTM. 

85U.S. Census Bureau, 2002 Economic Census, 

Subject Series: Information, ‘‘Establishment and 

Firm Size (Including Legal Form of Organization),’’ 

Table 4, NAICS code 517910. 

86 Id. An additional 14 firms had annual receipts 

of $25 million or more. 

87 13 CFR 121.201, NAICS code 517211. 

88 13 CFR 121.201, NAICS code 517212. 

89U.S. Census Bureau, 2002 Economic Census, 

Subject Series: Information, ‘‘Establishment and 

Firm Size (Including Legal Form of Organization,’’ 

Table 5, NAICS code 517211. 

90 Id. The census data do not provide a more 

precise estimate of the number of firms that have 

employment of 1,500 or fewer employees; the 

largest category provided is for firms with ‘‘1000 

employees or more.’’ 

91U.S. Census Bureau, 2002 Economic Census, 

Subject Series: Information, ‘‘Establishment and 

Firm Size (Including Legal Form of Organization),’’ 

Table 5, NAICS code 517212. 

92 Id. The census data do not provide a more 

precise estimate of the number of firms that have 

employment of 1,500 or fewer employees; the 

largest category provided is for firms with ‘‘1000 

employees or more.’’ 

93Office of Management and Budget, North 

American Industry Classification System, p. 515 

(1997). NAICS code 518111, ‘‘On-Line Information 

Services.’’ 

94 13 CFR 121.201, NAICS code 518111. 

has developed a small business size 

standard specifically for prepaid calling 

card providers. The appropriate size 

standard under SBA rules is for the 

category Telecommunications Resellers. 

Under that size standard, such a 

business is small if it has 1,500 or fewer 

employees.75 According to Commission 

data,76 88 carriers have reported that 

they are engaged in the provision of 

prepaid calling cards. Of these, an 

estimated 85 have 1,500 or fewer 

employees and three have more than 

1,500 employees. Consequently, the 

Commission estimates that the majority 

of prepaid calling card providers are 

small entities that may be affected by 

our proposed action. 

63. 800 and 800-Like Service 

Subscribers.77 Neither the Commission 

nor the SBA has developed a small 

business size standard specifically for 

800 and 800-like service (‘‘toll free’’) 

subscribers. The appropriate size 

standard under SBA rules is for the 

category Telecommunications Resellers. 

Under that size standard, such a 

business is small if it has 1,500 or fewer 

employees.78 The most reliable source 

of information regarding the number of 

these service subscribers appears to be 

data the Commission receives from 

Database Service Management on the 

800, 866, 877, and 888 numbers in 

use.79 According to our data, at the end 

of December 2007, the number of 800 

numbers assigned was 7,860,000; the 

number of 888 numbers assigned was 

5,210,184; the number of 877 numbers 

assigned was 4,388,682; and the number 

of 866 numbers assigned was 7,029,116. 

We do not have data specifying the 

number of these subscribers that are 

independently owned and operated or 

have 1,500 or fewer employees, and 

thus are unable at this time to estimate 

with greater precision the number of toll 

free subscribers that would qualify as 

small businesses under the SBA size 

standard. Consequently, we estimate 

that there are 7,860,000 or fewer small 

entity 800 subscribers; 5,210,184 or 

fewer small entity 888 subscribers; 

4,388,682 or fewer small entity 877 

subscribers, and 7,029,116 or fewer 

entity 866 subscribers. 

64. International Service Providers. 

There is no small business size standard 

developed specifically for providers of 

international service. The appropriate 

size standards under SBA rules are for 

the two broad census categories of 

‘‘Satellite Telecommunications’’ and 

‘‘Other Telecommunications.’’ Under 

both categories, such a business is small 

if it has $13.5 million or less in average 

annual receipts.80

65. The first category of Satellite 

Telecommunications ‘‘comprises 

establishments primarily engaged in 

providing point-to-point 

telecommunications services to other 

establishments in the 

telecommunications and broadcasting 

industries by forwarding and receiving 

communications signals via a system of 

satellites or reselling satellite 

telecommunications.’’ 81 For this 

category, Census Bureau data for 2002 

show that there were a total of 371 firms 

that operated for the entire year.82 Of 

this total, 307 firms had annual receipts 

of under $10 million, and 26 firms had 

receipts of $10 million to $24,999,999.83

Consequently, we estimate that the 

majority of Satellite 

Telecommunications firms are small 

entities that might be affected by our 

action. 

66. The second category of Other 

Telecommunications ‘‘comprises 

establishments primarily engaged in (1) 

Providing specialized 

telecommunications applications, such 

as satellite tracking, communications 

telemetry, and radar station operations; 

or (2) providing satellite terminal 

stations and associated facilities 

operationally connected with one or 

more terrestrial communications 

systems and capable of transmitting 

telecommunications to or receiving 

telecommunications from satellite 

systems.’’ 84 For this category, Census 

Bureau data for 2002 show that there 

were a total of 332 firms that operated 

for the entire year.85 Of this total, 259 

firms had annual receipts of under $10 

million and 15 firms had annual 

receipts of $10 million to $24,999,999.86

Consequently, we estimate that the 

majority of Other Telecommunications 

firms are small entities that might be 

affected by our action. 

67. Wireless Service Providers. The 

SBA has developed a small business 

size standard for wireless firms within 

the two broad economic census 

categories of ‘‘Paging’’ 87 and ‘‘Cellular 

and Other Wireless 

Telecommunications.’’ 88 Under both 

categories, the SBA deems a wireless 

business to be small if it has 1,500 or 

fewer employees. For the census 

category of Paging, Census Bureau data 

for 2002 show that there were 807 firms 

in this category that operated for the 

entire year.89 Of this total, 804 firms had 

employment of 999 or fewer employees, 

and three firms had employment of 

1,000 employees or more.90 Thus, under 

this category and associated small 

business size standard, the majority of 

firms can be considered small. For the 

census category of Cellular and Other 

Wireless Telecommunications, Census 

Bureau data for 2002 show that there 

were 1,397 firms in this category that 

operated for the entire year.91 Of this 

total, 1,378 firms had employment of 

999 or fewer employees, and 19 firms 

had employment of 1,000 employees or 

more.92 Thus, under this second 

category and size standard, the majority 

of firms can, again, be considered small. 

68. Internet Service Providers. The 

SBA has developed a small business 

size standard for Internet Service 

Providers. This category comprises 

establishments ‘‘primarily engaged in 

providing direct access through 

telecommunications networks to 

computer-held information compiled or 

published by others.’’ 93 Under the SBA 

size standard, such a business is small 

if it has average annual receipts of $21 

million or less.94 According to Census 

Bureau data for 1997, there were 2,751 

firms in this category that operated for 

Federal Register / Vol. 74, No. 104 / Tuesday, June 2, 2009 / Proposed Rules 26339 

95U.S. Census Bureau, 1997 Economic Census, 

Subject Series: ‘‘Information,’’ Table 4, Receipts 

Size of Firms Subject to Federal Income Tax: 1997, 

NAICS code 514191. 96U.S. Census Bureau, 1997 Economic Census, 

Subject Series: ‘‘Information,’’ Table 4, Receipts 

Size of Firms Subject to Federal Income Tax: 1997, 

NAICS code 514191. 97 13 CFR 121.201, NAICS code 517211. 98 13 CFR 121.201, NAICS code 517212. 99U.S. Census Bureau, 2002 Economic Census, 

Subject Series: Information, ‘‘Establishment and 

Firm Size (Including Legal Form of Organization,’’ 

Table 5, NAICS code 517211. 

100 Id. The census data do not provide a more 

precise estimate of the number of firms that have 

employment of 1,500 or fewer employees; the 

largest category provided is for firms with ‘‘1000 

employees or more.’’ 

101U.S. Census Bureau, 2002 Economic Census, 

Subject Series: Information, ‘‘Establishment and 

Firm Size (Including Legal Form of Organization,’’ 

Table 5, NAICS code 517212. 

102 Id. The census data do not provide a more 

precise estimate of the number of firms that have 

employment of 1,500 or fewer employees; the 

largest category provided is for firms with ‘‘1000 

employees or more.’’ 

103 13 CFR 121.201, NAICS code 517212. 

104U.S. Census Bureau, 1997 Economic Census, 

Subject Series: ‘‘Information,’’ Table 5, Employment 

Size of Firms Subject to Federal Income Tax: 1997, 

NAICS code 513321. 

105U.S. Census Bureau, 1997 Economic Census, 

Subject Series: ‘‘Information,’’ Table 5, Employment 

Size of Firms Subject to Federal Income Tax: 1997, 

NAICS code 513321. The census data do not 

provide a more precise estimate of the number of 

firms that have employment of 1,500 or fewer 

employees; the largest category provided is ‘‘Firms 

with 1000 employees or more.’’ 

106Revision of Part 22 and Part 90 of the 

Commission’s Rules to Facilitate Future 

Development of Paging Systems, Second Report and 

Order, 12 FCC Rcd 2732, 2811–2812, paras. 178– 

181 (‘‘Paging Second Report and Order’’); see also 

Revision of Part 22 and Part 90 of the Commission’s 

Rules To Facilitate Future Development of Paging 

Systems, Memorandum Opinion and Order on 

Reconsideration, 14 FCC Rcd 10030, 10085–10088, 

paragraphs 98–107 (1999). 

107Paging Second Report and Order, 12 FCC Rcd 

at 2811, paragraph 179. 

108See Letter from Aida Alvarez, Administrator, 

SBA, to Amy Zoslov, Chief, Auctions and Industry 

Analysis Division, Wireless Telecommunications 

Bureau (‘‘WTB’’), FCC (Dec. 2, 1998) (‘‘Alvarez 

Letter 1998’’). 

109See ‘‘929 and 931 MHz Paging Auction 

Closes,’’ Public Notice, 15 FCC Rcd 4858 (WTB 

2000). 

110See id. 

111See ‘‘Lower and Upper Paging Band Auction 

Closes,’’ Public Notice, 16 FCC Rcd 21821 (WTB 

2002). 

112See ‘‘Lower and Upper Paging Bands Auction 

Closes,’’ Public Notice, 18 FCC Rcd 11154 (WTB 

2003). 

113 ‘‘Trends in Telephone Service’’ at Table 5.3. 

114 ‘‘Trends in Telephone Service’’ at Table 5.3. 

115Amendment of the Commission’s Rules To 

Establish Part 27, the Wireless Communications 

Service (WCS), Report and Order, 12 FCC Rcd 

10785, 10879, para. 194 (1997). 

116See Alvarez Letter 1998. 

the entire year.95 Of these, 2,659 firms 

had annual receipts of under $10 

million, and an additional 67 firms had 

receipts of between $10 million and 

$24,999,999.96 Thus, under this size 

standard, the great majority of firms can 

be considered small entities. 

69. Cellular Licensees. The SBA has 

developed a small business size 

standard for wireless firms within the 

two broad economic census categories 

of ‘‘Paging’’ 97 and ‘‘Cellular and Other 

Wireless Telecommunications.’’ 98

Under both categories, the SBA deems 

a wireless business to be small if it has 

1,500 or fewer employees. For the 

census category of Paging, Census 

Bureau data for 2002 show that there 

were 807 firms in this category that 

operated for the entire year.99 Of this 

total, 804 firms had employment of 999 

or fewer employees, and three firms had 

employment of 1,000 employees or 

more.100 Thus, under this category and 

associated small business size standard, 

the majority of firms can be considered 

small. For the census category of 

Cellular and Other Wireless 

Telecommunications, Census Bureau 

data for 2002 show that there were 1,397 

firms in this category that operated for 

the entire year.101 Of this total, 1,378 

firms had employment of 999 or fewer 

employees, and 19 firms had 

employment of 1,000 employees or 

more.102 Thus, under this second 

category and size standard, the majority 

of firms can, again, be considered small. 

70. Common Carrier Paging. As noted, 

the SBA has developed a small business 

size standard for wireless firms within 

the broad economic census categories of 

‘‘Cellular and Other Wireless 

Telecommunications.’’ 103 Under this 

SBA category, a wireless business is 

small if it has 1,500 or fewer employees. 

For the census category of Paging, U.S. 

Census Bureau data for 1997 show that 

there were 1,320 firms in this category, 

total, that operated for the entire year.104

Of this total, 1,303 firms had 

employment of 999 or fewer employees, 

and an additional 17 firms had 

employment of 1,000 employees or 

more.105 Thus, under this category and 

associated small business size standard, 

the great majority of firms can be 

considered small. 

71. In addition, in the Paging Second 

Report and Order, the Commission 

adopted a size standard for ‘‘small 

businesses’’ for purposes of determining 

their eligibility for special provisions 

such as bidding credits and installment 

payments.106 A small business is an 

entity that, together with its affiliates 

and controlling principals, has average 

gross revenues not exceeding $15 

million for the preceding three years.107

The SBA has approved this 

definition.108 An auction of 

Metropolitan Economic Area (‘‘MEA’’) 

licenses commenced on February 24, 

2000, and closed on March 2, 2000. Of 

the 2,499 licenses auctioned, 985 were 

sold.109 Fifty-seven companies claiming 

small business status won 440 

licenses.110 An auction of MEA and 

Economic Area (‘‘EA’’) licenses 

commenced on October 30, 2001, and 

closed on December 5, 2001. Of the 

15,514 licenses auctioned, 5,323 were 

sold.111 One hundred thirty-two 

companies claiming small business 

status purchased 3,724 licenses. A third 

auction, consisting of 8,874 licenses in 

each of 175 EAs and 1,328 licenses in 

all but three of the 51 MEAs 

commenced on May 13, 2003, and 

closed on May 28, 2003. Seventy-seven 

bidders claiming small or very small 

business status won 2,093 licenses.112

72. Currently, there are approximately 

74,000 Common Carrier Paging licenses. 

According to the most recent Trends in 

Telephone Service, 281 carriers reported 

that they were engaged in the provision 

of ‘‘paging and messaging’’ services.113

Of these, an estimated 279 have 1,500 or 

fewer employees and two have more 

than 1,500 employees.114 We estimate 

that the majority of common carrier 

paging providers would qualify as small 

entities under the SBA definition. 

73. Wireless Communications 

Services. This service can be used for 

fixed, mobile, radiolocation, 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.115 The SBA has 

approved these definitions.116 The 

Commission auctioned geographic area 

licenses in the WCS service. In the 

auction, which commenced on April 15, 

1997 and closed on April 25, 1997, there 

were seven bidders that won 31 licenses 

that qualified as very small business 

entities, and one bidder that won one 

license that qualified as a small business 

entity. 

74. 1670–1675 MHz Services. An 

auction for one license in the 1670–1675 

MHz band commenced on April 30, 

2003 and closed the same day. One 

license was awarded. The winning 

bidder was not a small entity. 

75. Wireless Telephony. Wireless 

telephony includes cellular, personal 

communications services, and 

specialized mobile radio telephony 

carriers. The SBA has developed a small 

business size standard for ‘‘Cellular and 

26340 Federal Register / Vol. 74, No. 104 / Tuesday, June 2, 2009 / Proposed Rules 

117 13 CFR 121.201, NAICS code 517212. 

118 13 CFR 121.201, NAICS code 517212. 

119 ‘‘Trends in Telephone Service’’ at Table 5.3. 

120 ‘‘Trends in Telephone Service’’ at Table 5.3. 

121See Amendment of Parts 20 and 24 of the 

Commission’s Rules—Broadband PCS Competitive 

Bidding and the Commercial Mobile Radio Service 

Spectrum Cap, Report and Order, 11 FCC Rcd 7824, 

7850–7852, paras. 57–60 (1996) (‘‘PCS Report and 

Order’’); see also 47 CFR 24.720(b). 

122See PCS Report and Order, 11 FCC Rcd at 

7852, para. 60. 

123See Alvarez Letter 1998. 

124FCC News, ‘‘Broadband PCS, D, E and F Block 

Auction Closes,’’ No. 71744 (rel. Jan. 14, 1997). 

125See ‘‘C, D, E, and F Block Broadband PCS 

Auction Closes,’’ Public Notice, 14 FCC Rcd 6688 

(WTB 1999). 

126See ‘‘C and F Block Broadband PCS Auction 

Closes; Winning Bidders Announced,’’ Public 

Notice, 16 FCC Rcd 2339 (2001). 

127See ‘‘Broadband PCS Spectrum Auction 

Closes; Winning Bidders Announced for Auction 

No. 58,’’ Public Notice, 20 FCC Rcd 3703 (2005). 

128See ‘‘Auction of Broadband PCS Spectrum 

Licenses Closes; Winning Bidders Announced for 

Auction No. 71,’’ Public Notice, 22 FCC Rcd 9247 

(2007). 

129 Id. 

130 Implementation of Section 309(j) of the 

Communications Act—Competitive Bidding 

Narrowband PCS, Third Memorandum Opinion and 

Order and Further Notice of Proposed Rulemaking, 

10 FCC Rcd 175, 196, para. 46 (1994). 

131See ‘‘Announcing the High Bidders in the 

Auction of Ten Nationwide Narrowband PCS 

Licenses, Winning Bids Total $617,006,674,’’ Public 

Notice, PNWL 94–004 (rel. Aug. 2, 1994); 

‘‘Announcing the High Bidders in the Auction of 30 

Regional Narrowband PCS Licenses; Winning Bids 

Total $490,901,787,’’ Public Notice, PNWL 94–27 

(rel. Nov. 9, 1994). 

132Amendment of the Commission’s Rules to 

Establish New Personal Communications Services, 

Narrowband PCS, Second Report and Order and 

Second Further Notice of Proposed Rule Making, 15 

FCC Rcd 10456, 10476, para. 40 (2000) 

(‘‘Narrowband PCS Second Report and Order’’). 

133Narrowband PCS Second Report and Order, 

15 FCC Rcd at 10476, para. 40. 

134 Id. 

135See Alvarez Letter 1998. 

136See ‘‘Narrowband PCS Auction Closes,’’ 

Public Notice, 16 FCC Rcd 18663 (WTB 2001). 

137See Reallocation and Service Rules for the 

698–746 MHz Spectrum Band (Television Channels 

52–59), Report and Order, 17 FCC Rcd 1022 (2002) 

(‘‘Channels 52–59 Report and Order’’). 

138See Channels 52–59 Report and Order, 17 FCC 

Rcd at 1087–88, paragraph 172. 

139See id. 

140See id, 17 FCC Rcd at 1088, paragraph 173. 

141See Letter from Aida Alvarez, Administrator, 

SBA, to Thomas Sugrue, Chief, WTB, FCC (Aug. 10, 

1999) (‘‘Alvarez Letter 1999’’). 

Other Wireless Telecommunications’’ 

services.117 Under the SBA small 

business size standard, a business is 

small if it has 1,500 or fewer 

employees.118 According to Trends in 

Telephone Service data, 434 carriers 

reported that they were engaged in 

wireless telephony.119 Of these, an 

estimated 222 have 1,500 or fewer 

employees and 212 have more than 

1,500 employees.120 We have estimated 

that 222 of these are small under the 

SBA small business size standard. 

76. Broadband Personal 

Communications Service. The 

broadband personal communications 

services (‘‘PCS’’) spectrum is divided 

into six frequency blocks designated A 

through F, and the Commission has held 

auctions for each block. The 

Commission has created a small 

business size standard for Blocks C and 

F as an entity that has average gross 

revenues of less than $40 million in the 

three previous calendar years.121 For 

Block F, an additional small business 

size standard 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.122 These small business 

size standards, in the context of 

broadband PCS auctions, have been 

approved by the SBA.123 No small 

businesses within the SBA-approved 

small business size standards 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 percent of the 1,479 

licenses for Blocks D, E, and F.124 On 

March 23, 1999, the Commission 

reauctioned 155 C, D, E, and F Block 

licenses; there were 113 small business 

winning bidders.125

77. On January 26, 2001, the 

Commission completed the auction of 

422 C and F Broadband PCS licenses in 

Auction No. 35. Of the 35 winning 

bidders in this auction, 29 qualified as 

‘‘small’’ or ‘‘very small’’ businesses.126

Subsequent events, concerning Auction 

35, including judicial and agency 

determinations, resulted in a total of 163 

C and F Block licenses being available 

for grant. On February 15, 2005, the 

Commission completed an auction of 

188 C block licenses and 21 F block 

licenses in Auction No. 58. There were 

24 winning bidders for 217 licenses.127

Of the 24 winning bidders, 16 claimed 

small business status and won 156 

licenses. On May 21, 2007, the 

Commission completed an auction of 33 

licenses in the A, C, and F Blocks in 

Auction No. 71.128 Of the 14 winning 

bidders, six were designated entities.129

78. Narrowband Personal 

Communications Services. The 

Commission held an auction for 

Narrowband PCS licenses that 

commenced on July 25, 1994, and 

closed on July 29, 1994. A second 

auction commenced on October 26, 

1994 and closed on November 8, 1994. 

For purposes of the first two 

Narrowband PCS auctions, ‘‘small 

businesses’’ were entities with average 

gross revenues for the prior three 

calendar years of $40 million or less.130

Through these auctions, the 

Commission awarded a total of 41 

licenses, 11 of which were obtained by 

four small businesses.131 To ensure 

meaningful participation by small 

business entities in future auctions, the 

Commission adopted a two-tiered small 

business size standard in the 

Narrowband PCS Second Report and 

Order.132 A ‘‘small business’’ is an 

entity that, together with affiliates and 

controlling interests, has average gross 

revenues for the three preceding years of 

not more than $40 million.133 A ‘‘very 

small business’’ is an entity that, 

together with affiliates and controlling 

interests, has average gross revenues for 

the three preceding years of not more 

than $15 million.134 The SBA has 

approved these small business size 

standards.135 A third auction 

commenced on October 3, 2001 and 

closed on October 16, 2001. Here, five 

bidders won 317 (Metropolitan Trading 

Areas and nationwide) licenses.136

Three of these claimed status as a small 

or very small entity and won 311 

licenses. 

79. Lower 700 MHz Band Licenses. 

The Commission previously adopted 

criteria for defining three groups of 

small businesses for purposes of 

determining their eligibility for special 

provisions such as bidding credits.137

The Commission defined a ‘‘small 

business’’ as an entity that, together 

with its affiliates and controlling 

principals, has average gross revenues 

not exceeding $40 million for the 

preceding three years.138 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 $15 

million for the preceding three years.139

Additionally, the lower 700 MHz 

Service had a third category of small 

business status for Metropolitan/Rural 

Service Area (‘‘MSA/RSA’’) licenses. 

The third category is ‘‘entrepreneur,’’ 

which 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.140

The SBA approved these small size 

standards.141 An auction of 740 licenses 

(one license in each of the 734 MSAs/ 

RSAs and one license in each of the six 

Economic Area Groupings (EAGs)) 

commenced on August 27, 2002, and 

closed on September 18, 2002. Of the 

740 licenses available for auction, 484 

licenses were sold to 102 winning 

bidders. Seventy-two of the winning 

Federal Register / Vol. 74, No. 104 / Tuesday, June 2, 2009 / Proposed Rules 26341 

142See ‘‘Lower 700 MHz Band Auction Closes,’’ 

Public Notice, 17 FCC Rcd 17272 (WTB 2002). 143See ‘‘Lower 700 MHz Band Auction Closes,’’ 

Public Notice, 18 FCC Rcd 11873 (WTB 2003). 144See id. 145Service Rules for the 698–746, 747–762 and 

777–792 MHz Bands, WT Docket No. 06–150, 

Revision of the Commission’s Rules to Ensure 

Compatibility with Enhanced 911 Emergency 

Calling Systems, CC Docket No. 94–102, Section 

68.4(a) of the Commission’s Rules Governing 

Hearing Aid-Compatible Telephones, WT Docket 

No. 01–309, Biennial Regulatory Review— 

Amendment of Parts 1, 22, 24, 27, and 90 to 

Streamline and Harmonize Various Rules Affecting 

Wireless Radio Services, WT Docket 03–264, 

Former Nextel Communications, Inc. Upper 700 

MHz Guard Band Licenses and Revisions to Part 27 

of the Commission’s Rules, WT Docket No. 06–169, 

Implementing a Nationwide, Broadband, 

Interoperable Public Safety Network in the 700 MHz 

Band, PS Docket No. 06–229, Development of 

Operational, Technical and Spectrum 

Requirements for Meeting Federal, State and Local 

Public Safety Communications Requirements 

Through the Year 2010, WT Docket No. 96–86, 

Second Report and Order, FCC 07–132 (2007) (‘‘700 

MHz Second Report and Order’’). 

146See ‘‘Auction of 700 MHz Band Licenses 

Scheduled for January 16, 2008; Comment Sought 

on Competitive Bidding Procedures For Auction 

73,’’ Public Notice, FCC Rcd 15004 (WTB 2007). 

147See id. 

148See Service Rules for the 746–764 MHz Bands, 

and Revisions to Part 27 of the Commission’s Rules, 

Second Report and Order, 15 FCC Rcd 5299 (2000) 

(‘‘746–764 MHz Band Second Report and Order’’). 

149See 746–764 MHz Band Second Report and 

Order, 15 FCC Rcd at 5343, para. 108. 

150See id. 

151See id., 15 FCC Rcd 5299, 5343, para. 108 

n.246 (for the 746–764 MHz and 776–794 MHz 

bands, the Commission is exempt from 15 U.S.C. 

632, which requires Federal agencies to obtain SBA 

approval before adopting small business size 

standards). 

152See ‘‘700 MHz Guard Bands Auction Closes: 

Winning Bidders Announced,’’ Public Notice, 15 

FCC Rcd 18026 (2000). 

153See ‘‘700 MHz Guard Bands Auction Closes: 

Winning Bidders Announced,’’ Public Notice, 16 

FCC Rcd 4590 (WTB 2001). 

154 47 CFR 90.814(b)(1). 

155 47 CFR 90.814(b)(1). 

156See Alvarez Letter 1999. 

157See ‘‘Correction to Public Notice DA 96–586 

‘FCC Announces Winning Bidders in the Auction 

of 1020 Licenses to Provide 900 MHz SMR in Major 

Trading Areas,’’’ Public Notice, 18 FCC Rcd 18367 

(WTB 1996). 

158See ‘‘Multi-Radio Service Auction Closes,’’ 

Public Notice, 17 FCC Rcd 1446 (WTB 2002). 

159See ‘‘800 MHz Specialized Mobile Radio 

(SMR) Service General Category (851–854 MHz) and 

Upper Band (861–865 MHz) Auction Closes; 

Winning Bidders Announced,’’ Public Notice, 15 

FCC Rcd 17162 (2000). 

160See, ‘‘800 MHz SMR Service Lower 80 

Channels Auction Closes; Winning Bidders 

Continued 

bidders claimed small business, very 

small business or entrepreneur status 

and won a total of 329 licenses.142 A 

second auction commenced on May 28, 

2003, and closed on June 13, 2003, and 

included 256 licenses: 5 EAG licenses 

and 476 Cellular Market Area 

licenses.143 Seventeen winning bidders 

claimed small or very small business 

status and won 60 licenses, and nine 

winning bidders claimed entrepreneur 

status and won 154 licenses.144 On July 

26, 2005, the Commission completed an 

auction of 5 licenses in the Lower 700 

MHz band (Auction No. 60). There were 

three winning bidders for five licenses. 

All three winning bidders claimed small 

business status. 

80. The Commission recently 

reexamined its rules governing the 700 

MHz band in the 700 MHz Second 

Report and Order.145 An auction of 700 

MHz licenses commenced January 24, 

2008. For the Lower 700 MHz band, 176 

licenses over Economic Areas in the A 

Block, 734 licenses over Cellular Market 

Areas in the B Block, and 176 licenses 

over EAs in the E Block are available for 

licensing.146 Winning bidders may be 

eligible for small business status (those 

with attributable average annual gross 

revenues that exceed $15 million and do 

not exceed $40 million for the preceding 

three years), or very small business 

status (those with attributable average 

annual gross revenues that do not 

exceed $15 million for the preceding 

three years). 

81. Upper 700 MHz Band Licenses. In 

the 700 MHz Second Report and Order, 

the Commission revised its rules 

regarding Upper 700 MHz licenses. On 

January 24, 2008, the Commission 

commenced Auction 73 in which 

several licenses in the Upper 700 MHz 

band are available for licensing: 12 

licenses over Regional Economic Area 

Groupings (‘‘REAGs’’) in the C Block, 

and one nationwide license in the D 

Block.147 Winning bidders may be 

eligible for small business status (those 

with attributable average annual gross 

revenues that exceed $15 million and do 

not exceed $40 million for the preceding 

three years), or very small business 

status (those with attributable average 

annual gross revenues that do not 

exceed $15 million for the preceding 

three years). 

82. 700 MHz Guard Band Licenses. In 

the 700 MHz Guard Band Order, the 

Commission adopted size standards for 

‘‘small businesses’’ and ‘‘very small 

businesses’’ for purposes of determining 

their eligibility for special provisions 

such as bidding credits and installment 

payments.148 A small business in this 

service is an entity that, together with 

its affiliates and controlling principals, 

has average gross revenues not 

exceeding $40 million for the preceding 

three years.149 Additionally, a very 

small business is an entity that, together 

with its affiliates and controlling 

principals, has average gross revenues 

that are not more than $15 million for 

the preceding three years.150 SBA 

approval of these definitions is not 

required.151 An auction of 52 Major 

Economic Area (‘‘MEA’’) licenses 

commenced on September 6, 2000, and 

closed on September 21, 2000.152 Of the 

104 licenses auctioned, 96 licenses were 

sold to nine bidders. Five of these 

bidders were small businesses that won 

a total of 26 licenses. A second auction 

of 700 MHz Guard Band licenses 

commenced on February 13, 2001, and 

closed on February 21, 2001. All eight 

of the licenses auctioned were sold to 

three bidders. One of these bidders was 

a small business that won a total of two 

licenses.153

83. Specialized Mobile Radio. The 

Commission awards ‘‘small entity’’ 

bidding credits in auctions for 

Specialized Mobile Radio (SMR) 

geographic area licenses in the 800 MHz 

and 900 MHz bands to firms that had 

revenues of no more than $15 million in 

each of the three previous calendar 

years.154 The Commission awards ‘‘very 

small entity’’ bidding credits to firms 

that had revenues of no more than $3 

million in each of the three previous 

calendar years.155 The SBA has 

approved these small business size 

standards for the 900 MHz Service.156

The Commission has held auctions for 

geographic area licenses in the 800 MHz 

and 900 MHz bands. The 900 MHz SMR 

auction began on December 5, 1995, and 

closed on April 15, 1996. Sixty bidders 

claiming that they qualified as small 

businesses under the $15 million size 

standard won 263 geographic area 

licenses in the 900 MHz SMR band. The 

800 MHz SMR auction for the upper 200 

channels began on October 28, 1997, 

and was completed on December 8, 

1997. Ten bidders claiming that they 

qualified as small businesses under the 

$15 million size standard won 38 

geographic area licenses for the upper 

200 channels in the 800 MHz SMR 

band.157 A second auction for the 800 

MHz band was held on January 10, 2002 

and closed on January 17, 2002 and 

included 23 BEA licenses. One bidder 

claiming small business status won five 

licenses.158

84. The auction of the 1,053 800 MHz 

SMR geographic area licenses for the 

General Category channels began on 

August 16, 2000, and was completed on 

September 1, 2000. Eleven bidders won 

108 geographic area licenses for the 

General Category channels in the 800 

MHz SMR band qualified as small 

businesses under the $15 million size 

standard.159 In an auction completed on 

December 5, 2000, a total of 2,800 

Economic Area licenses in the lower 80 

channels of the 800 MHz SMR service 

were awarded.160 Of the 22 winning 

26342 Federal Register / Vol. 74, No. 104 / Tuesday, June 2, 2009 / Proposed Rules 

Announced,’’ Public Notice, 16 FCC Rcd 1736 

(2000). 

161 13 CFR 121.201, NAICS code 517212. 

162Amendment of Part 90 of the Commission’s 

Rules to Provide For the Use of the 220–222 MHz 

Band by the Private Land Mobile Radio Service, 

Third Report and Order, 12 FCC Rcd 10943, 11068– 

70, paras. 291–295 (1997). 

163 Id. at 11068, para. 291. 

164 Id. 

165See Letter from Aida Alvarez, Administrator, 

SBA, to Daniel Phythyon, Chief, WTB, FCC (Jan. 6, 

1998) (‘‘Alvarez to Phythyon Letter 1998’’). 

166 See generally ‘‘220 MHz Service Auction 

Closes,’’ Public Notice, 14 FCC Rcd 605 (1998). 

167See ‘‘FCC Announces It is Prepared to Grant 

654 Phase II 220 MHz Licenses After Final Payment 

is Made,’’ Public Notice, 14 FCC Rcd 1085 (1999). 

168See ‘‘Phase II 220 MHz Service Spectrum 

Auction Closes,’’ Public Notice, 14 FCC Rcd 11218 

(1999). 

169See ‘‘Multi-Radio Service Auction Closes,’’ 

Public Notice, 17 FCC Rcd 1446 (2002). 

170See ‘‘Auction of Phase II 220 MHz Service 

Spectrum Licenses Closes,’’ Public Notice, 22 FCC 

Rcd 11573 (WTB 2007). 

171See 13 CFR 121.201, NAICS code 517212. 

172See generally 13 CFR 121.201. 

173Federal Communications Commission, 60th 

Annual Report, Fiscal Year 1994, at paragraph 116. 

174See 47 CFR 101 et seq. for common carrier 

fixed microwave services (except Multipoint 

Distribution Service). 

175Persons eligible under parts 80 and 90 of the 

Commission’s Rules can use Private OperationalFixed Microwave services. See 47 CFR Parts 80 and 

90. Stations in this service are called operationalfixed to distinguish them from common carrier and 

public fixed stations. Only the licensee may use the 

operational-fixed station, and only for 

communications related to the licensee’s 

commercial, industrial, or safety operations. 

176Auxiliary Microwave Service is governed by 

Part 74 of Title 47 of the Commission’s Rules. See 

47 CFR Part 74. This service is available to licensees 

of broadcast stations and to broadcast and cable 

network entities. Broadcast auxiliary microwave 

stations are used for relaying broadcast television 

signals from the studio to the transmitter, or 

between two points such as a main studio and an 

auxiliary studio. The service also includes mobile 

television pickups, which relay signals from a 

remote location back to the studio. 

bidders, 19 claimed small business 

status and won 129 licenses. Thus, 

combining all three auctions, 40 

winning bidders for geographic licenses 

in the 800 MHz SMR band claimed 

status as small business. 

85. In addition, there are numerous 

incumbent site-by-site SMR licensees 

and licensees with extended 

implementation authorizations in the 

800 and 900 MHz bands. We do not 

know how many firms provide 800 MHz 

or 900 MHz geographic area SMR 

pursuant to extended implementation 

authorizations, nor how many of these 

providers have annual revenues of no 

more than $15 million. One firm has 

over $15 million in revenues. We 

assume, for purposes of this analysis, 

that all of the remaining existing 

extended implementation 

authorizations are held by small 

entities, as that small business size 

standard is approved by the SBA. 

86. 220 MHz Radio Service—Phase I 

Licensees. The 220 MHz service has 

both Phase I and Phase II licenses. Phase 

I licensing was conducted by lotteries in 

1992 and 1993. There are approximately 

1,515 such non-nationwide 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 small business size standard 

under the SBA rules applicable to 

‘‘Cellular and Other Wireless 

Telecommunications’’ companies. This 

category provides that a small business 

is a wireless company employing no 

more than 1,500 persons.161 The 

Commission estimates that most such 

licensees are small businesses under the 

SBA’s small business standard. 

87. 220 MHz Radio Service—Phase II 

Licensees. The 220 MHz service has 

both Phase I and Phase II licenses. The 

Phase II 220 MHz service is a new 

service, and is subject to spectrum 

auctions. In the 220 MHz Third Report 

and Order, the Commission adopted a 

small business size standard for 

defining ‘‘small’’ and ‘‘very small’’ 

businesses for purposes of determining 

their eligibility for special provisions 

such as bidding credits and installment 

payments.162 This small business 

standard indicates that a ‘‘small 

business’’ is an entity that, together with 

its affiliates and controlling principals, 

has average gross revenues not 

exceeding $15 million for the preceding 

three years.163 A ‘‘very small business’’ 

is defined as an entity that, together 

with its affiliates and controlling 

principals, has average gross revenues 

that do not exceed $3 million for the 

preceding three years.164 The SBA has 

approved these small size standards.165

Auctions of Phase II licenses 

commenced on September 15, 1998, and 

closed on October 22, 1998.166 In the 

first auction, 908 licenses were 

auctioned in three different-sized 

geographic areas: three nationwide 

licenses, 30 Regional Economic Area 

Group (‘‘EAG’’) Licenses, and 875 

Economic Area (EA) Licenses. Of the 

908 licenses auctioned, 693 were 

sold.167 Thirty-nine small businesses 

won 373 licenses in the first 220 MHz 

auction. A second auction included 225 

licenses: 216 EA licenses and 9 EAG 

licenses. Fourteen companies claiming 

small business status won 158 

licenses.168 A third auction included 

four licenses: 2 BEA licenses and 2 EAG 

licenses in the 220 MHz Service. No 

small or very small business won any of 

these licenses.169 The Commission 

conducted a fourth auction in 2007 with 

three of the five winning bidders 

claiming small or very small business 

status.170

88. 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, and are 

often used in support of the licensee’s 

primary (non-telecommunications) 

business operations. For the purpose of 

determining whether a licensee of a 

PLMR system is a small business as 

defined by the SBA, we use the broad 

census category, ‘‘Cellular and Other 

Wireless Telecommunications.’’ This 

definition provides that a small entity is 

any such entity employing no more than 

1,500 persons.171 The Commission does 

not require PLMR licensees to disclose 

information about number of 

employees, so the Commission does not 

have information that could be used to 

determine how many PLMR licensees 

constitute small entities under this 

definition. We note that PLMR licensees 

generally use the licensed facilities in 

support of other business activities, and 

therefore, it would also be helpful to 

assess PLMR licensees under the 

standards applied to the particular 

industry subsector to which the licensee 

belongs.172

89. The Commission’s 1994 Annual 

Report on PLMRs 173 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. We note that any 

entity engaged in a commercial activity 

is eligible to hold a PLMR license, and 

that the revised rules in this context 

could therefore potentially impact small 

entities covering a great variety of 

industries. 

90. Fixed Microwave Services. Fixed 

microwave services include common 

carrier,174 private operational-fixed,175

and broadcast auxiliary radio 

services.176 At present, there are 

approximately 22,015 common carrier 

fixed licensees and 61,670 private 

operational-fixed licensees and 

broadcast auxiliary radio licensees in 

the microwave services. The 

Commission has not created a size 

standard for a small business 

specifically with respect to fixed 

microwave services. For purposes of 

this analysis, the Commission uses the 

SBA small business size standard for the 

Federal Register / Vol. 74, No. 104 / Tuesday, June 2, 2009 / Proposed Rules 26343 

177 13 CFR 121.201, NAICS code 517212. 

178See Amendment of the Commission’s Rules 

Regarding the 37.0–38.6 GHz and 38.6–40.0 GHz 

Bands, ET Docket No. 95–183, Report and Order, 12 

FCC Rcd 18600 (1997). 

179 Id. 

180See Letter from Aida Alvarez, Administrator, 

SBA, to Kathleen O’Brien Ham, Chief, Auctions and 

Industry Analysis Division, WTB, FCC (Feb. 4, 

1998); See Letter from Hector Barreto, 

Administrator, SBA, to Margaret Wiener, Chief, 

Auctions and Industry Analysis Division, WTB, 

FCC (Jan. 18, 2002). 

181See Rulemaking to Amend Parts 1, 2, 21, 25, 

of the Commission’s Rules to Redesignate the 27.5– 

29.5 GHz Frequency Band, Reallocate the 29.5–30.5 

Frequency Band, to Establish Rules and Policies for 

Local Multipoint Distribution Service and for Fixed 

Satellite Services, Second Report and Order, Order 

on Reconsideration, and Fifth Notice of Proposed 

Rule Making, 12 FCC Rcd 12545, 12689–90, 

paragraph 348 (1997) (‘‘LMDS Second Report and 

Order’’). 

182See LMDS Second Report and Order, 12 FCC 

Rcd at 12689–90, paragraph 348. 

183See id. 

184See Alvarez to Phythyon Letter 1998. 

185See ‘‘Interactive Video and Data Service 

(IVDS) Applications Accepted for Filing,’’ Public 

Notice, 9 FCC Rcd 6227 (1994). 

186 Implementation of Section 309(j) of the 

Communications Act—Competitive Bidding, Fourth 

Report and Order, 9 FCC Rcd 2330 (1994). 

187Amendment of Part 95 of the Commission’s 

Rules to Provide Regulatory Flexibility in the 218– 

219 MHz Service, Report and Order and 

Memorandum Opinion and Order, 15 FCC Rcd 1497 

(1999). 

188 Id. 

189See Alvarez to Phythyon Letter 1998. 

190Amendment of Part 90 of the Commission’s 

Rules to Adopt Regulations for Automatic Vehicle 

Monitoring Systems, Second Report and Order, 13 

FCC Rcd 15182, 15192, paragraph 20 (1998) 

(‘‘Automatic Vehicle Monitoring Systems Second 

Report and Order’’); see also 47 CFR 90.1103. 

191Automatic Vehicle Monitoring Systems 

Second Report and Order, 13 FCC Rcd at 15192, 

para. 20; see also 47 CFR 90.1103. 

192See Alvarez Letter 1998. 

193The service is defined in section 22.99 of the 

Commission’s rules, 47 CFR 22.99. 

194BETRS is defined in section 22.757 and 22.759 

of the Commission’s rules, 47 CFR 22.757 and 

22.759. 

195 13 CFR 121.201, NAICS code 517212. 

category ‘‘Cellular and Other 

Telecommunications,’’ which is 1,500 

or fewer employees.177 The Commission 

does not have data specifying the 

number of these licensees that have no 

more than 1,500 employees, and thus 

are unable at this time to estimate with 

greater precision the number of fixed 

microwave service licensees that would 

qualify as small business concerns 

under the SBA’s small business size 

standard. Consequently, the 

Commission estimates that there are 

22,015 or fewer common carrier fixed 

licensees and 61,670 or fewer private 

operational-fixed licensees and 

broadcast auxiliary radio licensees in 

the microwave services that may be 

small and may be affected by the rules 

and policies proposed herein. We note, 

however, that the common carrier 

microwave fixed licensee category 

includes some large entities. 

91. 39 GHz Service. The Commission 

created a special small business size 

standard for 39 GHz licenses—an entity 

that has average gross revenues of $40 

million or less in the three previous 

calendar years.178 An additional size 

standard for ‘‘very small business’’ is: an 

entity that, together with affiliates, has 

average gross revenues of not more than 

$15 million for the preceding three 

calendar years.179 The SBA has 

approved these small business size 

standards.180 The auction of the 2,173 

39 GHz licenses began on April 12, 2000 

and closed on May 8, 2000. The 18 

bidders who claimed small business 

status won 849 licenses. 

92. Local Multipoint Distribution 

Service. Local Multipoint Distribution 

Service (‘‘LMDS’’) is a fixed broadband 

point-to-multipoint microwave service 

that provides for two-way video 

telecommunications.181 The auction of 

the 986 LMDS licenses began on 

February 18, 1998 and closed on March 

25, 1998. The Commission established a 

small business size standard for LMDS 

licenses as an entity that has average 

gross revenues of less than $40 million 

in the three previous calendar years.182

An additional small business size 

standard for ‘‘very small business’’ was 

added as an entity that, together with its 

affiliates, has average gross revenues of 

not more than $15 million for the 

preceding three calendar years.183 The 

SBA has approved these small business 

size standards in the context of LMDS 

auctions.184 There were 93 winning 

bidders that qualified as small entities 

in the LMDS auctions. A total of 93 

small and very small business bidders 

won approximately 277 A Block 

licenses and 387 B Block licenses. On 

March 27, 1999, the Commission reauctioned 161 licenses; there were 32 

small and very small businesses 

winning that won 119 licenses. 

93. 218–219 MHz Service. The first 

auction of 218–219 MHz (previously 

referred to as the Interactive and Video 

Data Service or IVDS) spectrum resulted 

in 178 entities winning licenses for 594 

Metropolitan Statistical Areas 

(‘‘MSAs’’).185 Of the 594 licenses, 567 

were won by 167 entities qualifying as 

a small business. For that auction, the 

Commission defined a small business as 

an entity that, together with its affiliates, 

has no more than a $6 million net worth 

and, after Federal income taxes 

(excluding any carry over losses), has no 

more than $2 million in annual profits 

each year for the previous two years.186

In the 218–219 MHz Report and Order 

and Memorandum Opinion and Order, 

we defined a small business as an entity 

that, together with its affiliates and 

persons or entities that hold interests in 

such an entity and their affiliates, has 

average annual gross revenues not 

exceeding $15 million for the preceding 

three years.187 A very small business is 

defined as an entity that, together with 

its affiliates and persons or entities that 

hold interests in such an entity and its 

affiliates, has average annual gross 

revenues not exceeding $3 million for 

the preceding three years.188 The SBA 

has approved of these definitions.189 A 

subsequent auction is not yet scheduled. 

Given the success of small businesses in 

the previous auction, and the 

prevalence of small businesses in the 

subscription television services and 

message communications industries, we 

assume for purposes of this analysis that 

in future auctions, many, and perhaps 

most, of the licenses may be awarded to 

small businesses. 

94. Location and Monitoring Service 

(‘‘LMS’’). Multilateration LMS systems 

use non-voice radio techniques to 

determine the location and status of 

mobile radio units. For purposes of 

auctioning LMS licenses, the 

Commission has defined ‘‘small 

business’’ as an entity that, together 

with controlling interests and affiliates, 

has average annual gross revenues for 

the preceding three years not exceeding 

$15 million.190 A ‘‘very small business’’ 

is defined as an entity that, together 

with controlling interests and affiliates, 

has average annual gross revenues for 

the preceding three years not exceeding 

$3 million.191 These definitions have 

been approved by the SBA.192 An 

auction for LMS licenses commenced on 

February 23, 1999, and closed on March 

5, 1999. Of the 528 licenses auctioned, 

289 licenses were sold to four small 

businesses. 

95. Rural Radiotelephone Service. The 

Commission has not adopted a size 

standard for small businesses specific to 

the Rural Radiotelephone Service.193 A 

significant subset of the Rural 

Radiotelephone Service is the Basic 

Exchange Telephone Radio System 

(‘‘BETRS’’).194 In the present context, 

we will use the SBA’s small business 

size standard applicable to ‘‘Cellular 

and Other Wireless 

Telecommunications,’’ i.e., an entity 

employing no more than 1,500 

persons.195 There are approximately 

1,000 licensees in the Rural 

Radiotelephone Service, and the 

Commission estimates that there are 

1,000 or fewer small entity licensees in 

the Rural Radiotelephone Service that 

26344 Federal Register / Vol. 74, No. 104 / Tuesday, June 2, 2009 / Proposed Rules 

196The service is defined in section 22.99 of the 

Commission’s rules, 47 CFR 22.99. 

197 13 CFR 121.201, NAICS codes 517212. 

198Amendment of Part 22 of the Commission’s 

Rules to Benefit the Consumers of Air-Ground 

Telecommunications Services, Biennial Regulatory 

Review—Amendment of Parts 1, 22, and 90 of the 

Commission’s Rules, Amendment of Parts 1 and 22 

of the Commission’s Rules to Adopt Competitive 

Bidding Rules for Commercial and General Aviation 

Air-Ground Radiotelephone Service, WT Docket 

Nos. 03–103 and 05–42, Order on Reconsideration 

and Report and Order, 20 FCC Rcd 19663, 

paragraphs 28–42 (2005). 

199 Id. 

200See Letter from Hector V. Barreto, 

Administrator, SBA, to Gary D. Michaels, Deputy 

Chief, Auctions and Spectrum Access Division, 

WTB, FCC (Sept. 19, 2005). 

201 Vessels that are not required by law to carry 

a radio and do not make international voyages or 

communications are not required to obtain an 

individual license. See Amendment of Parts 80 and 

87 of the Commission’s rules to Permit Operation 

of Certain Domestic Ship and Aircraft Radio 

Stations Without Individual Licenses, Report and 

Order, WT Docket No. 96–82, 11 FCC Rcd 14849 

(1996). 

202 13 CFR 121.201, NAICS code 517212. 

203A licensee may have a license in more than 

one category. 

204Amendment of the Commission’s Rules 

Concerning Maritime Communications, PR Docket 

No. 92–257, Third Report and Order and 

Memorandum Opinion and Order, 13 FCC Rcd 

19853 (1998). 

205See ‘‘Automated Maritime 

Telecommunications System Spectrum Auction 

Scheduled for September 15, 2004, Notice and 

Filing Requirements, Minimum Opening Bids, 

Upfront Payments and Other Auction Procedures,’’ 

Public Notice, 19 FCC Rcd 9518 (WTB 2004); 

‘‘Auction of Automated Maritime 

Telecommunications System Licenses Scheduled 

for August 3, 2005, Notice and Filing Requirements, 

Minimum Opening Bids, Upfront Payments and 

Other Auction Procedures for Auction No. 61,’’ 

Public Notice, 20 FCC Rcd 7811 (WTB 2005). 

206 47 CFR 80.1252. 

207This service is governed by Subpart I of Part 

22 of the Commission’s Rules. See 47 CFR 22.1001– 

22.1037. 

208 13 CFR 121.201, NAICS code 517212. 

209 Id. 

210See Amendment of the Commission’s Rules 

Regarding Multiple Address Systems, Report and 

Order, 15 FCC Rcd 11956, 12008, paragraph 123 

(2000). 

211 Id. 

212See Alvarez Letter 1999. 

213See ‘‘Multiple Address Systems Spectrum 

Auction Closes,’’ Public Notice, 16 FCC Rcd 21011 

(2001). 

may be affected by the rules and 

policies proposed herein. 

96. Air-Ground Radiotelephone 

Service.196 The Commission has 

previously used the SBA’s small 

business definition applicable to 

‘‘Cellular and Other Wireless 

Telecommunications,’’ i.e., an entity 

employing no more than 1,500 

persons.197 There are approximately 100 

licensees in the Air-Ground 

Radiotelephone Service, and under that 

definition, we estimate that almost all of 

them qualify as small entities under the 

SBA definition. For purposes of 

assigning Air-Ground Radiotelephone 

Service licenses through competitive 

bidding, the Commission has defined 

‘‘small business’’ as an entity that, 

together with controlling interests and 

affiliates, has average annual gross 

revenues for the preceding three years 

not exceeding $40 million.198 A ‘‘very 

small business’’ is defined as an entity 

that, together with controlling interests 

and affiliates, has average annual gross 

revenues for the preceding three years 

not exceeding $15 million.199 These 

definitions were approved by the 

SBA.200 In May 2006, the Commission 

completed an auction of nationwide 

commercial Air-Ground Radiotelephone 

Service licenses in the 800 MHz band 

(Auction No. 65). On June 2, 2006, the 

auction closed with two winning 

bidders winning two Air-Ground 

Radiotelephone Services licenses. 

Neither of the winning bidders claimed 

small business status. 

97. Aviation and Marine Radio 

Services. There are approximately 

26,162 aviation, 34,555 marine (ship), 

and 3,296 marine (coast) licensees.201

The Commission has not developed a 

small business size standard specifically 

applicable to all licensees. For purposes 

of this analysis, we will use the SBA 

small business size standard for the 

category ‘‘Cellular and Other 

Telecommunications,’’ which is 1,500 

or fewer employees.202 We are unable to 

determine how many of those licensed 

fall under this standard. For purposes of 

our evaluations in this analysis, we 

estimate that there are up to 

approximately 62,969 licensees that are 

small businesses under the SBA 

standard.203 In December 1998, the 

Commission held an auction of 42 VHF 

Public Coast licenses in the 157.1875– 

157.4500 MHz (ship transmit) and 

161.775–162.0125 MHz (coast transmit) 

bands. For this auction, the Commission 

defined a ‘‘small’’ business as an entity 

that, together with controlling interests 

and affiliates, has average gross 

revenues for the preceding three years 

not to exceed $15 million dollars. In 

addition, a ‘‘very small’’ business is one 

that, together with controlling interests 

and affiliates, has average gross 

revenues for the preceding three years 

not to exceed $3 million dollars.204

Further, the Commission made available 

Automated Maritime 

Telecommunications System (‘‘AMTS’’) 

licenses in Auctions 57 and 61.205

Winning bidders could claim status as 

a very small business or a very small 

business. A very small business for this 

service is defined as an entity with 

attributed average annual gross revenues 

that do not exceed $3 million for the 

preceding three years, and a small 

business is defined as an entity with 

attributed average annual gross revenues 

of more than $3 million but less than 

$15 million for the preceding three 

years.206 Three of the winning bidders 

in Auction 57 qualified as small or very 

small businesses, while three winning 

entities in Auction 61 qualified as very 

small businesses. 

98. Offshore Radiotelephone Service. 

This service operates on several ultra 

high frequencies (‘‘UHF’’) television 

broadcast channels that are not used for 

television broadcasting in the coastal 

areas of States bordering the Gulf of 

Mexico.207 There is presently 1 licensee 

in this service. We do not have 

information whether that licensee 

would qualify as small under the SBA’s 

small business size standard for 

‘‘Cellular and Other Wireless 

Telecommunications’’ services.208

Under that SBA small business size 

standard, a business is small if it has 

1,500 or fewer employees.209

99. Multiple Address Systems 

(‘‘MAS’’). Entities using MAS spectrum, 

in general, fall into two categories: (1) 

Those using the spectrum for profitbased uses, and (2) those using the 

spectrum for private internal uses. With 

respect to the first category, the 

Commission defines ‘‘small entity’’ for 

MAS licenses as an entity that has 

average gross revenues of less than $15 

million in the three previous calendar 

years.210 ‘‘Very small business’’ is 

defined as an entity that, together with 

its affiliates, has average gross revenues 

of not more than $3 million for the 

preceding three calendar years.211 The 

SBA has approved of these 

definitions.212 The majority of these 

entities will most likely be licensed in 

bands where the Commission has 

implemented a geographic area 

licensing approach that would require 

the use of competitive bidding 

procedures to resolve mutually 

exclusive applications. The 

Commission’s licensing database 

indicates that, as of January 20, 1999, 

there were a total of 8,670 MAS station 

authorizations. Of these, 260 

authorizations were associated with 

common carrier service. In addition, an 

auction for 5,104 MAS licenses in 176 

EAs began November 14, 2001, and 

closed on November 27, 2001.213 Seven 

winning bidders claimed status as small 

or very small businesses and won 611 

licenses. On May 18, 2005, the 

Commission completed an auction 

(Auction No. 59) of 4,226 MAS licenses 

in the Fixed Microwave Services from 

the 928/959 and 932/941 MHz bands. 

Twenty-six winning bidders won a total 

Federal Register / Vol. 74, No. 104 / Tuesday, June 2, 2009 / Proposed Rules 26345 

214See 13 CFR 121.201, NAICS code 517212. 

215See ‘‘Auction of 1.4 GHz Bands Licenses 

Scheduled for February 7, 2007,’’ Public Notice, 21 

FCC Rcd 12393 (WTB 2006). 

216See ‘‘Auction of 1.4 GHz Band Licenses 

Closes; Winning Bidders Announced for Auction 

No. 69,’’ Public Notice, 22 FCC Rcd 4714 (2007) 

(‘‘Auction No. 69 Closing PN’’). 

217Auction No. 69 Closing PN, Attachment C. 

218See Auction No. 69 Closing PN. 

219 13 CFR 121.201, NAICS code 517212. 

220U.S. Census Bureau, 2002 Economic Census, 

Subject Series: Information, ‘‘Establishment and 

Firm Size (Including Legal Form of Organization,’’ 

Table 5, NAICS code 517211. 

221 Id. The census data do not provide a more 

precise estimate of the number of firms that have 

employment of 1,500 or fewer employees; the 

largest category provided is for firms with ‘‘1000 

employees or more.’’ 

222U.S. Census Bureau, 2002 Economic Census, 

Subject Series: Information, ‘‘Establishment and 

Firm Size (Including Legal Form of Organization,’’ 

Table 5, NAICS code 517212. 

223 Id. The census data do not provide a more 

precise estimate of the number of firms that have 

employment of 1,500 or fewer employees; the 

largest category provided is for firms with ‘‘1000 

employees or more.’’ 

224Teligent acquired the DEMS licenses of 

FirstMark, the only licensee other than TRW in the 

24 GHz band whose license has been modified to 

require relocation to the 24 GHz band. 

225Amendments to Parts 1, 2, 87 and 101 of the 

Commission’s Rules To License Fixed Services at 24 

GHz, Report and Order, 15 FCC Rcd 16934, 16967, 

paragraph 77 (2000) (‘‘24 GHz Report and Order’’); 

see also 47 CFR 101.538(a)(2). 

226 24 GHz Report and Order, 15 FCC Rcd at 

16967, para. 77; see also 47 CFR 101.538(a)(1). 

227See Letter from Gary M. Jackson, Assistant 

Administrator, SBA, to Margaret W. Wiener, Deputy 

Chief, Auctions and Industry Analysis Division, 

WTB, FCC (July 28, 2000). 

228Amendment of Parts 21 and 74 of the 

Commission’s Rules with Regard to Filing 

Procedures in the Multipoint Distribution Service 

and in the Instructional Television Fixed Service 

and Implementation of Section 309(j) of the 

Communications Act—Competitive Bidding, MM 

Docket No. 94–131 and PP Docket No. 93–253, 

Report and Order, 10 FCC Rcd 9589, 9593, 

paragraph 7 (1995) (‘‘MDS Auction R&O’’). 

229 47 CFR 21.961(b)(1). 

230 47 U.S.C. 309(j). Hundreds of stations were 

licensed to incumbent MDS licensees prior to 

implementation of Section 309(j) of the 

Communications Act of 1934, 47 U.S.C. 309(j). For 

these pre-auction licenses, the applicable standard 

is SBA’s small business size standard. 

of 2,323 licenses. Of the 26 winning 

bidders in this auction, five claimed 

small business status and won 1,891 

licenses. 

100. With respect to the second 

category, which consists of entities that 

use, or seek to use, MAS spectrum to 

accommodate internal communications 

needs, we note that MAS serves an 

essential role in a range of industrial, 

safety, business, and land transportation 

activities. MAS radios are used by 

companies of all sizes, operating in 

virtually all U.S. business categories, 

and by all types of public safety entities. 

For the majority of private internal 

users, the small business size standard 

developed by the SBA would be more 

appropriate. The applicable size 

standard in this instance appears to be 

that of ‘‘Cellular and Other Wireless 

Telecommunications’’. This definition 

provides that a small entity is any such 

entity employing no more than 1,500 

persons.214 The Commission’s licensing 

database indicates that, as of January 20, 

1999, of the 8,670 total MAS station 

authorizations, 8,410 authorizations 

were for private radio service, and of 

these, 1,433 were for private land 

mobile radio service. 

101. 1.4 GHz Band Licensees. The 

Commission conducted an auction of 64 

1.4 GHz band licenses, beginning on 

February 7, 2007,215 and closing on 

March 8, 2007.216 In that auction, the 

Commission defined ‘‘small business’’ 

as an entity that, together with its 

affiliates and controlling interests, had 

average gross revenues that exceed $15 

million but do not exceed $40 million 

for the preceding three years, and a 

‘‘very small business’’ as an entity that, 

together with its affiliates and 

controlling interests, has had average 

annual gross revenues not exceeding 

$15 million for the preceding three 

years.217 Neither of the two winning 

bidders sought designated entity 

status.218

102. Incumbent 24 GHz Licensees. 

This analysis may affect incumbent 

licensees who were relocated to the 24 

GHz band from the 18 GHz band, and 

applicants who wish to provide services 

in the 24 GHz band. The applicable SBA 

small business size standard is that of 

‘‘Cellular and Other Wireless 

Telecommunications’’ companies. This 

category provides that such a company 

is small if it employs no more than 

1,500 persons.219 For the census 

category of Paging, Census Bureau data 

for 2002 show that there were 807 firms 

in this category that operated for the 

entire year.220 Of this total, 804 firms 

had employment of 999 or fewer 

employees, and three firms had 

employment of 1,000 employees or 

more.221 Thus, under this category and 

associated small business size standard, 

the majority of firms can be considered 

small. For the census category of 

Cellular and Other Wireless 

Telecommunications, Census Bureau 

data for 2002 show that there were 1,397 

firms in this category that operated for 

the entire year.222 Of this total, 1,378 

firms had employment of 999 or fewer 

employees, and 19 firms had 

employment of 1,000 employees or 

more.223 Thus, under this second 

category and size standard, the majority 

of firms can, again, be considered small. 

These broader census data 

notwithstanding, we believe that there 

are only two licensees in the 24 GHz 

band that were relocated from the 18 

GHz band, Teligent 224 and TRW, Inc. It 

is our understanding that Teligent and 

its related companies have fewer than 

1,500 employees, though this may 

change in the future. TRW is not a small 

entity. There are approximately 122 

licensees in the Rural Radiotelephone 

Service, and the Commission estimates 

that there are 122 or fewer small entity 

licensees in the Rural Radiotelephone 

Service that may be affected by the rules 

and policies proposed herein. 

103. Future 24 GHz Licensees. With 

respect to new applicants in the 24 GHz 

band, we have defined ‘‘small business’’ 

as an entity that, together with 

controlling interests and affiliates, has 

average annual gross revenues for the 

three preceding years not exceeding $15 

million.225 ‘‘Very small business’’ in the 

24 GHz band is defined as an entity that, 

together with controlling interests and 

affiliates, has average gross revenues not 

exceeding $3 million for the preceding 

three years.226 The SBA has approved 

these definitions.227 The Commission 

will not know how many licensees will 

be small or very small businesses until 

the auction, if required, is held. 

104. Broadband Radio Service. 

Broadband Radio Service systems, 

previously referred to as Multipoint 

Distribution Service (‘‘MDS’’) and 

Multichannel Multipoint Distribution 

Service (‘‘MMDS’’) systems, and 

‘‘wireless cable,’’ transmit video 

programming to subscribers and provide 

two-way high speed data operations 

using the microwave frequencies of the 

Broadband Radio Service (‘‘BRS’’) and 

Educational Broadband Service (‘‘EBS’’) 

(previously referred to as the 

Instructional Television Fixed Service 

(‘‘ITFS’’)).228 In connection with the 

1996 BRS auction, the Commission 

established a small business size 

standard as an entity that had annual 

average gross revenues of no more than 

$40 million in the previous three 

calendar years.229 The BRS auctions 

resulted in 67 successful bidders 

obtaining licensing opportunities for 

493 Basic Trading Areas (‘‘BTAs’’). Of 

the 67 auction winners, 61 met the 

definition of a small business. BRS also 

includes licensees of stations authorized 

prior to the auction. At this time, we 

estimate that of the 61 small business 

BRS auction winners, 48 remain small 

business licensees. In addition to the 48 

small businesses that hold BTA 

authorizations, there are approximately 

392 incumbent BRS licensees that are 

considered small entities.230 After 

26346 Federal Register / Vol. 74, No. 104 / Tuesday, June 2, 2009 / Proposed Rules 

231 13 CFR 121.201, NAICS code 517510. 

232U.S. Census Bureau, 2002 Economic Census, 

Subject Series: Information, Table 4, Receipts Size 

of Firms for the United States: 2002, NAICS code 

517510. 

233 Id. An additional 61 firms had annual receipts 

of $25 million or more. 

234The term ‘‘small entity’’ within SBREFA 

applies to small organizations (nonprofits) and to 

small governmental jurisdictions (cities, counties, 

towns, townships, villages, school districts, and 

special districts with populations of less than 

50,000). 5 U.S.C. 601(4)–(6). We do not collect 

annual revenue data on EBS licensees. 

235U.S. Census Bureau, 2002 NAICS Definitions, 

‘‘515120 Television Broadcasting’’ (partial 

definition); http://www.census.gov/epcd/naics02/ 

def/NDEF515.HTM. 

236 13 CFR 121.201, NAICS code 515120. 

237 ‘‘Concerns are affiliates of each other when 

one concern controls or has the power to control 

the other or a third party or parties controls or has 

the power to control both.’’ 13 CFR 21.103(a)(1). 

238FCC News Release, ‘‘Broadcast Station Totals 

as of September 30, 2007.’’ 

239See OMB, North American Industry 

Classification System: United States, 1997, at 509 

(1997) (Radio Stations) (NAICS code 515112). 

240 Id. 

241 ‘‘Concerns are affiliates of each other when 

one concern controls or has the power to control 

the other, or a third party or parties controls or has 

the power to control both.’’ 13 CFR 121.103(a)(1). 

242 ‘‘SBA counts the receipts or employees of the 

concern whose size is at issue and those of all its 

domestic and foreign affiliates, regardless of 

whether the affiliates are organized for profit, in 

determining the concern’s size.’’ 13 CFR 121(a)(4). 

243 13 CFR 121.201, NAICS codes 513111 and 

513112. 

244See supra note 242. 

245 15 U.S.C. 632. 

adding the number of small business 

auction licensees to the number of 

incumbent licensees not already 

counted, we find that there are currently 

approximately 440 BRS licensees that 

are defined as small businesses under 

either the SBA or the Commission’s 

rules. 

105. In addition, the SBA has 

developed a small business size 

standard for Cable and Other Program 

Distribution, which includes all such 

companies generating $13.5 million or 

less in annual receipts.231 According to 

Census Bureau data for 2002, there were 

a total of 1,191 firms in this category 

that operated for the entire year.232 Of 

this total, 1,087 firms had annual 

receipts of under $10 million, and 43 

firms had receipts of $10 million or 

more but less than $25 million.233

Consequently, we estimate that the 

majority of providers in this service 

category are small businesses that may 

be affected by the rules and policies 

adopted herein. This SBA small 

business size standard is applicable to 

EBS. There are presently 2,032 EBS 

licensees. All but 100 of these licenses 

are held by educational institutions. 

Educational institutions are included in 

this analysis as small entities.234 Thus, 

we estimate that at least 1,932 licensees 

are small businesses. 

106. Television Broadcasting. The 

Census Bureau defines this category as 

follows: ‘‘This industry comprises 

establishments primarily engaged in 

broadcasting images together with 

sound. These establishments operate 

television broadcasting studios and 

facilities for the programming and 

transmission of programs to the 

public.’’ 235 The SBA has created a small 

business size standard for Television 

Broadcasting entities, which is: such 

firms having $13 million or less in 

annual receipts.236 According to 

Commission staff review of the BIA 

Financial Network, Inc., Media Access 

Pro Television Database as of December 

7, 2007, about 825 (66 percent) of the 

1,250 commercial television stations in 

the United States have revenues of $13 

million or less. However, in assessing 

whether a business entity qualifies as 

small under the above definition, 

business control affiliations 237 must be 

included. Our estimate, therefore, likely 

overstates the number of small entities 

that might be affected by our action, 

because the revenue figure on which it 

is based does not include or aggregate 

revenues from affiliated companies. 

107. In addition, an element of the 

definition of ‘‘small business’’ is that the 

entity not be dominant in its field of 

operation. We are unable at this time to 

define or quantify the criteria that 

would establish whether a specific 

television station is dominant in its field 

of operation. Accordingly, the estimate 

of small businesses to which rules may 

apply do not exclude any television 

station from the definition of a small 

business on this basis and are therefore 

over-inclusive to that extent. Also as 

noted, an additional element of the 

definition of ‘‘small business’’ is that the 

entity must be independently owned 

and operated. We note that it is difficult 

at times to assess these criteria in the 

context of media entities and our 

estimates of small businesses to which 

they apply may be over-inclusive to this 

extent. 

108. There are also 2,117 low power 

television stations (‘‘LPTV’’).238 Given 

the nature of this service, we will 

presume that all LPTV licensees qualify 

as small entities under the above SBA 

small business size standard. 

109. Radio Broadcasting. The SBA 

defines a radio broadcast entity that has 

$6 million or less in annual receipts as 

a small business.239 Business concerns 

included in this industry are those 

‘‘primarily engaged in broadcasting 

aural programs by radio to the public.240

According to Commission staff review 

of the BIA Publications, Inc., Master 

Access Radio Analyzer Database, as of 

May 16, 2003, about 10,427 of the 

10,945 commercial radio stations in the 

United States have revenue of $6 

million or less. We note, however, that 

many radio stations are affiliated with 

much larger corporations with much 

higher revenue, and that in assessing 

whether a business concern qualifies as 

small under the above definition, such 

business (control) affiliations 241 are 

included.242 Our estimate, therefore 

likely overstates the number of small 

businesses that might be affected by our 

action. 

110. Auxiliary, Special Broadcast and 

Other Program Distribution Services. 

This service involves a variety of 

transmitters, generally used to relay 

broadcast programming to the public 

(through translator and booster stations) 

or within the program distribution chain 

(from a remote news gathering unit back 

to the station). The Commission has not 

developed a definition of small entities 

applicable to broadcast auxiliary 

licensees. The applicable definitions of 

small entities are those, noted 

previously, under the SBA rules 

applicable to radio broadcasting stations 

and television broadcasting stations.243

111. The Commission estimates that 

there are approximately 5,618 FM 

translators and boosters.244 The 

Commission does not collect financial 

information on any broadcast facility, 

and the Department of Commerce does 

not collect financial information on 

these auxiliary broadcast facilities. We 

believe that most, if not all, of these 

auxiliary facilities could be classified as 

small businesses by themselves. We also 

recognize that most commercial 

translators and boosters are owned by a 

parent station which, in some cases, 

would be covered by the revenue 

definition of small business entity 

discussed above. These stations would 

likely have annual revenues that exceed 

the SBA maximum to be designated as 

a small business ($6.5 million for a 

radio station or $13.0 million for a TV 

station). Furthermore, they do not meet 

the Small Business Act’s definition of a 

‘‘small business concern’’ because they 

are not independently owned and 

operated.245

112. Cable and Other Program 

Distribution. The Census Bureau defines 

this category as follows: ‘‘This industry 

comprises establishments primarily 

engaged as third-party distribution 

systems for broadcast programming. The 

establishments of this industry deliver 

visual, aural, or textual programming 

received from cable networks, local 

television stations, or radio networks to 

Federal Register / Vol. 74, No. 104 / Tuesday, June 2, 2009 / Proposed Rules 26347 

246U.S. Census Bureau, 2002 NAICS Definitions, 

‘‘517510 Cable and Other Program Distribution’’; 

http://www.census.gov/epcd/naics02/def/ 

NDEF517.HTM. 

247 13 CFR 121.201, NAICS code 517510. 

248U.S. Census Bureau, 2002 Economic Census, 

Subject Series: Information, Table 4, Receipts Size 

of Firms for the United States: 2002, NAICS code 

517510. 

249 Id. An additional 61 firms had annual receipts 

of $25 million or more. 

250 47 CFR 76.901(e). The Commission 

determined that this size standard equates 

approximately to a size standard of $100 million or 

less in annual revenues. Implementation of Sections 

of the 1992 Cable Act: Rate Regulation, Sixth Report 

and Order and Eleventh Order on Reconsideration, 

10 FCC Rcd 7393, 7408 (1995). 

251These data are derived from: R.R. Bowker, 

Broadcasting & Cable Yearbook 2006, ‘‘Top 25 

Cable/Satellite Operators,’’ pages A–8 & C–2; 

Warren Communications News, Television & Cable 

Factbook 2006, ‘‘Ownership of Cable Systems in the 

United States,’’ pages D–1805 to D–1857. 

252 47 CFR 76.901(c). 

253Warren Communications News, Television & 

Cable Factbook 2006, ‘‘U.S. Cable Systems by 

Subscriber Size,’’ page F–2. The data do not include 

718 systems for which classifying data were not 

available. 

254 47 U.S.C. 543(m)(2); see 47 CFR 76.901(f) & 

nn. 1–3. 255 47 CFR 76.901(f); see ‘‘FCC Announces New 

Subscriber Count for the Definition of Small Cable 

Operator,’’ Public Notice, 16 FCC Rcd 2225 (Cable 

Services Bureau, 2001). 256These data are derived from: R.R. Bowker, 

Broadcasting & Cable Yearbook 2006, ‘‘Top 25 

Cable/Satellite Operators,’’ pages A–8 & C–2 (data 

current as of June 30, 2005); Warren 

Communications News, Television & Cable 

Factbook 2006, ‘‘Ownership of Cable Systems in the 

United States,’’ pages D–1805 to D–1857. 257The Commission does receive such 

information on a case-by-case basis if a cable 

operator appeals a local franchise authority’s 

finding that the operator does not qualify as a small 

cable operator pursuant to section 76.901(f) of the 

Commission’s rules. See 47 CFR 76.909(b). 

258See 47 U.S.C. 573. 

259 13 CFR 121.201, NAICS code 517510. 

260 See http://www.fcc.gov/csb/ovs/ 

csovscer.html. 

261 13 CFR 121.201, NAICS code 517510. 

262U.S. Census Bureau, 2002 Economic Census, 

Subject Series: Information, Table 4, Receipts Size 

of Firms for the United States: 2002, NAICS code 

517510. 

263 Id. An additional 61 firms had annual receipts 

of $25 million or more. 

264Amendment of Parts 2 and 25 of the 

Commission’s Rules to Permit Operation of NGSO 

FSS Systems Co-Frequency with GSO and 

Terrestrial Systems in the Ku-Band Frequency 

Range; Amendment of the Commission’s Rules to 

Authorize Subsidiary Terrestrial Use of the 12.2– 

12.7 GHz Band by Direct Broadcast Satellite 

Licenses and their Affiliates; and Applications of 

Broadwave USA, PDC Broadband Corporation, and 

Satellite Receivers, Ltd. to provide A Fixed Service 

in the 12.2–12.7 GHz Band, ET Docket No. 98–206, 

Memorandum Opinion and Order and Second 

Report and Order, 17 FCC Rcd 9614, 9711, 

paragraph 252 (2002). 

265See Letter from Hector V. Barreto, 

Administrator, U.S. Small Business Administration, 

to Margaret W. Wiener, Chief, Auctions and 

Industry Analysis Division, WTB, FCC (Feb.13, 

2002). 

consumers via cable or direct-to-home 

satellite systems on a subscription or fee 

basis. These establishments do not 

generally originate programming 

material.’’ 246 The SBA has developed a 

small business size standard for Cable 

and Other Program Distribution, which 

is: all such firms having $13.5 million 

or less in annual receipts.247 According 

to Census Bureau data for 2002, there 

were a total of 1,191 firms in this 

category that operated for the entire 

year.248 Of this total, 1,087 firms had 

annual receipts of under $10 million, 

and 43 firms had receipts of $10 million 

or more but less than $25 million.249

Thus, under this size standard, the 

majority of firms can be considered 

small. 

113. Cable Companies and Systems. 

The Commission has also developed its 

own small business size standards, for 

the purpose of cable rate regulation. 

Under the Commission’s rules, a ‘‘small 

cable company’’ is one serving 400,000 

or fewer subscribers, nationwide.250

Industry data indicate that, of 1,076 

cable operators nationwide, all but 

eleven are small under this size 

standard.251 In addition, under the 

Commission’s rules, a ‘‘small system’’ is 

a cable system serving 15,000 or fewer 

subscribers.252 Industry data indicate 

that, of 7,208 systems nationwide, 6,139 

systems have under 10,000 subscribers, 

and an additional 379 systems have 

10,000–19,999 subscribers.253 Thus, 

under this second size standard, most 

cable systems are small. 

114. Cable System Operators. The 

Communications Act of 1934, as 

amended, also contains a size standard 

for small cable system operators, which 

is ‘‘a cable operator that, directly or 

through an affiliate, serves in the 

aggregate fewer than 1 percent of all 

subscribers in the United States and is 

not affiliated with any entity or entities 

whose gross annual revenues in the 

aggregate exceed $250,000,000.’’ 254 The 

Commission has determined that an 

operator serving fewer than 677,000 

subscribers shall be deemed a small 

operator, if its annual revenues, when 

combined with the total annual 

revenues of all its affiliates, do not 

exceed $250 million in the aggregate.255

Industry data indicate that, of 1,076 

cable operators nationwide, all but ten 

are small under this size standard.256

We note that the Commission neither 

requests nor collects information on 

whether cable system operators are 

affiliated with entities whose gross 

annual revenues exceed $250 

million,257 and therefore we are unable 

to estimate more accurately the number 

of cable system operators that would 

qualify as small under this size 

standard. 

115. Open Video Services. Open 

Video Service (‘‘OVS’’) systems provide 

subscription services.258 The SBA has 

created a small business size standard 

for Cable and Other Program 

Distribution.259 This standard provides 

that a small entity is one with $13.5 

million or less in annual receipts. The 

Commission has certified approximately 

25 OVS operators to serve 75 areas, and 

some of these are currently providing 

service.260 Affiliates of Residential 

Communications Network, Inc. (‘‘RCN’’) 

received approval to operate OVS 

systems in New York City, Boston, 

Washington, D.C., and other areas. RCN 

has sufficient revenues to assure that 

they do not qualify as a small business 

entity. Little financial information is 

available for the other entities that are 

authorized to provide OVS and are not 

yet operational. Given that some entities 

authorized to provide OVS service have 

not yet begun to generate revenues, the 

Commission concludes that up to 24 

OVS operators (those remaining) might 

qualify as small businesses that may be 

affected by the rules and policies 

proposed herein. 

116. Cable Television Relay Service. 

This service includes transmitters 

generally used to relay cable 

programming within cable television 

system distribution systems. The SBA 

has developed a small business size 

standard for Cable and Other Program 

Distribution, which is: all such firms 

having $13.5 million or less in annual 

receipts.261 According to Census Bureau 

data for 2002, there were a total of 1,191 

firms in this category that operated for 

the entire year.262 Of this total, 1,087 

firms had annual receipts of under $10 

million, and 43 firms had receipts of 

$10 million or more but less than $25 

million.263 Thus, under this size 

standard, the majority of firms can be 

considered small. 

117. Multichannel Video Distribution 

and Data Service. MVDDS is a terrestrial 

fixed microwave service operating in 

the 12.2–12.7 GHz band. The 

Commission adopted criteria for 

defining three groups of small 

businesses for purposes of determining 

their eligibility for special provisions 

such as bidding credits. It defined a very 

small business as an entity with average 

annual gross revenues not exceeding $3 

million for the preceding three years; a 

small business as an entity with average 

annual gross revenues not exceeding 

$15 million for the preceding three 

years; and an entrepreneur as an entity 

with average annual gross revenues not 

exceeding $40 million for the preceding 

three years.264 These definitions were 

approved by the SBA.265 On January 27, 

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266See ‘‘Multichannel Video Distribution and 

Data Service Auction Closes,’’ Public Notice, 19 

FCC Rcd 1834 (2004). 

267See ‘‘Auction of Multichannel Video 

Distribution and Data Service Licenses Closes; 

Winning Bidders Announced for Auction No. 63,’’ 

Public Notice, 20 FCC Rcd 19807 (2005). 

268 13 CFR 121.201, NAICS code 517212. 

269 Amendment of the Commission’s Rules 

Concerning Maritime Communications, Third 

Report and Order and Memorandum Opinion and 

Order, 13 FCC Rcd 19853 (1998). 

270 47 CFR Part 90. 

271The Citizens Band Radio Service, General 

Mobile Radio Service, Radio Control Radio Service, 

Family Radio Service, Wireless Medical Telemetry 

Service, Medical Implant Communications Service, 

Low Power Radio Service, and Multi-Use Radio 

Service are governed by Subpart D, Subpart A, 

Subpart C, Subpart B, Subpart H, Subpart I, Subpart 

G, and Subpart J, respectively, of Part 95 of the 

Commission’s rules. See generally 47 CFR Part 95. 

272 13 CFR 121.201, NAICS Code 517212. 

273With the exception of the special emergency 

service, these services are governed by Subpart B 

of part 90 of the Commission’s rules, 47 CFR 90.15– 

90.27. The police service includes approximately 

27,000 licensees that serve State, county, and 

municipal enforcement through telephony (voice), 

telegraphy (code) and teletype and facsimile 

(printed material). The fire radio service includes 

approximately 23,000 licensees comprised of 

private volunteer or professional fire companies as 

well as units under governmental control. The local 

government service that is presently comprised of 

approximately 41,000 licensees that are State, 

county, or municipal entities that use the radio for 

official purposes not covered by other public safety 

services. There are approximately 7,000 licensees 

within the forestry service which is comprised of 

licensees from State departments of conservation 

and private forest organizations who set up 

communications networks among fire lookout 

towers and ground crews. The approximately 9,000 

State and local governments are licensed to 

highway maintenance service provide emergency 

and routine communications to aid other public 

safety services to keep main roads safe for vehicular 

traffic. The approximately 1,000 licensees in the 

Emergency Medical Radio Service (‘‘EMRS’’) use 

the 39 channels allocated to this service for 

emergency medical service communications related 

to the delivery of emergency medical treatment. 47 

CFR 90.15–90.27. The approximately 20,000 

licensees in the special emergency service include 

medical services, rescue organizations, 

veterinarians, handicapped persons, disaster relief 

organizations, school buses, beach patrols, 

establishments in isolated areas, communications 

standby facilities, and emergency repair of public 

communications facilities. 47 CFR 90.33–90.55. 

274 47 CFR 1.1162. 

275 5 U.S.C. 601(5). 

276See 47 CFR 1.1162 for the general exemptions 

from regulatory fees. E.g., Amateur radio licensees 

(except applicants for vanity call signs) and 

operators in other non-licensed services (e.g., 

Personal Radio, part 15, ship and aircraft). 

Governments and non-profit (exempt under section 

501(c) of the Internal Revenue Code) entities are 

exempt from payment of regulatory fees and need 

not submit payment. Non-commercial educational 

broadcast licensees are exempt from regulatory fees 

as are licensees of auxiliary broadcast services such 

as low power auxiliary stations, television auxiliary 

service stations, remote pickup stations and aural 

broadcast auxiliary stations where such licenses are 

used in conjunction with commonly owned non2004, the Commission completed an 

auction of 214 MVDDS licenses 

(Auction No. 53). In this auction, ten 

winning bidders won a total of 192 

MVDDS licenses.266 Eight of the ten 

winning bidders claimed small business 

status and won 144 of the licenses. The 

Commission also held an auction of 

MVDDS licenses on December 7, 2005 

(Auction 63). Of the three winning 

bidders who won 22 licenses, two 

winning bidders, winning 21 of the 

licenses, claimed small business 

status.267

118. Amateur Radio Service. These 

licensees are held by individuals in a 

noncommercial capacity; these licensees 

are not small entities. 

119. Aviation and Marine Services. 

Small businesses in the aviation and 

marine radio services use a very high 

frequency (‘‘VHF’’) marine or aircraft 

radio and, as appropriate, an emergency 

position-indicating radio beacon (and/or 

radar) or an emergency locator 

transmitter. The Commission has not 

developed a small business size 

standard specifically applicable to these 

small businesses. For purposes of this 

analysis, the Commission uses the SBA 

small business size standard for the 

category ‘‘Cellular and Other 

Telecommunications,’’ which is 1,500 

or fewer employees.268 Most applicants 

for recreational licenses are individuals. 

Approximately 581,000 ship station 

licensees and 131,000 aircraft station 

licensees operate domestically and are 

not subject to the radio carriage 

requirements of any statute or treaty. 

For purposes of our evaluations in this 

analysis, we estimate that there are up 

to approximately 712,000 licensees that 

are small businesses (or individuals) 

under the SBA standard. In addition, 

between December 3, 1998 and 

December 14, 1998, the Commission 

held an auction of 42 VHF Public Coast 

licenses in the 157.1875–157.4500 MHz 

(ship transmit) and 161.775–162.0125 

MHz (coast transmit) bands. For 

purposes of the auction, the 

Commission defined a ‘‘small’’ business 

as an entity that, together with 

controlling interests and affiliates, has 

average gross revenues for the preceding 

three years not to exceed $15 million. In 

addition, a ‘‘very small’’ business is one 

that, together with controlling interests 

and affiliates, has average gross 

revenues for the preceding three years 

not to exceed $3 million.269 There are 

approximately 10,672 licensees in the 

Marine Coast Service, and the 

Commission estimates that almost all of 

them qualify as ‘‘small’’ businesses 

under the above special small business 

size standards. 

120. Personal Radio Services. 

Personal radio services provide shortrange, low power radio for personal 

communications, radio signaling, and 

business communications not provided 

for in other services. The Personal Radio 

Services include spectrum licensed 

under Part 95 of our rules.270 These 

services include Citizen Band Radio 

Service (‘‘CB’’), General Mobile Radio 

Service (‘‘GMRS’’), Radio Control Radio 

Service (‘‘R/C’’), Family Radio Service 

(‘‘FRS’’), Wireless Medical Telemetry 

Service (‘‘WMTS’’), Medical Implant 

Communications Service (‘‘MICS’’), Low 

Power Radio Service (‘‘LPRS’’), and 

Multi-Use Radio Service (‘‘MURS’’).271

There are a variety of methods used to 

license the spectrum in these rule parts, 

from licensing by rule, to conditioning 

operation on successful completion of a 

required test, to site-based licensing, to 

geographic area licensing. Under the 

RFA, the Commission is required to 

make a determination of which small 

entities are directly affected by the rules 

being proposed. Since all such entities 

are wireless, we apply the definition of 

cellular and other wireless 

telecommunications, pursuant to which 

a small entity is defined as employing 

1,500 or fewer persons.272 Many of the 

licensees in these services are 

individuals, and thus are not small 

entities. In addition, due to the mostly 

unlicensed and shared nature of the 

spectrum utilized in many of these 

services, the Commission lacks direct 

information upon which to base an 

estimation of the number of small 

entities under an SBA definition that 

might be directly affected by the 

proposed rules. 

121. Public Safety Radio Services. 

Public Safety radio services include 

police, fire, local government, forestry 

conservation, highway maintenance, 

and emergency medical services.273

There are a total of approximately 

127,540 licensees in these services. 

Governmental entities 274 as well as 

private businesses comprise the 

licensees for these services. All 

governmental entities with populations 

of less than 50,000 fall within the 

definition of a small entity.275

IV. Description of Projected Reporting, 

Recordkeeping and Other Compliance 

Requirements 

122. With certain exceptions, the 

Commission’s Schedule of Regulatory 

Fees applies to all Commission 

licensees and regulatees. Most licensees 

will be required to count the number of 

licenses or call signs authorized, 

complete and submit an FCC Form 159 

Remittance Advice, and pay a regulatory 

fee based on the number of licenses or 

call signs.276 Interstate telephone 

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commercial educational stations. Emergency Alert 

System licenses for auxiliary service facilities are 

also exempt as are instructional television fixed 

service licensees. Regulatory fees are automatically 

waived for the licensee of any translator station 

that: (1) Is not licensed to, in whole or in part, and 

does not have common ownership with, the 

licensee of a commercial broadcast station; (2) does 

not derive income from advertising; and (3) is 

dependent on subscriptions or contributions from 

members of the community served for support. 

Receive only earth station permittees are exempt 

from payment of regulatory fees. A regulatee will 

be relieved of its fee payment requirement if its 

total fee due, including all categories of fees for 

which payment is due by the entity, amounts to less 

than $10. 

277 47 CFR 1.1164. 

278 47 CFR 1.1164(c). 

279Public Law 104–134, 110 Stat. 1321 (1996). 

280 31 U.S.C. 7701(c)(2)(B). 

281 47 CFR 1.1166. 

282 5 U.S.C. 603. 

service providers must compute their 

annual regulatory fee based on their 

interstate and international end-user 

revenue using information they already 

supply to the Commission in 

compliance with the Form 499–A, 

Telecommunications Reporting 

Worksheet, and they must complete and 

submit the FCC Form 159. Compliance 

with the fee schedule will require some 

licensees to tabulate the number of units 

(e.g., cellular telephones, pagers, cable 

TV subscribers) they have in service, 

and complete and submit an FCC Form 

159. Licensees ordinarily will keep a list 

of the number of units they have in 

service as part of their normal business 

practices. No additional outside 

professional skills are required to 

complete the FCC Form 159, and it can 

be completed by the employees 

responsible for an entity’s business 

records. 

123. Each licensee must submit the 

FCC Form 159 to the Commission’s 

lockbox bank after computing the 

number of units subject to the fee. 

Licensees may also file electronically to 

minimize the burden of submitting 

multiple copies of the FCC Form 159. 

Applicants who pay small fees in 

advance and provide fee information as 

part of their application must use FCC 

Form 159. 

124. Licensees and regulatees are 

advised that failure to submit the 

required regulatory fee in a timely 

manner will subject the licensee or 

regulatee to a late payment penalty of 25 

percent in addition to the required 

fee.277 If payment is not received, new 

or pending applications may be 

dismissed, and existing authorizations 

may be subject to rescission.278 Further, 

in accordance with the DCIA, Federal 

agencies may bar a person or entity from 

obtaining a Federal loan or loan 

insurance guarantee if that person or 

entity fails to pay a delinquent debt 

owed to any Federal agency.279

Nonpayment of regulatory fees is a debt 

owed the United States pursuant to 31 

U.S.C. 3711 et seq., and the DCIA. 

Appropriate enforcement measures as 

well as administrative and judicial 

remedies, may be exercised by the 

Commission. Debts owed to the 

Commission may result in a person or 

entity being denied a Federal loan or 

loan guarantee pending before another 

Federal agency until such obligations 

are paid.280

125. The Commission’s rules 

currently provide for relief in 

exceptional circumstances. Persons or 

entities may request a waiver, reduction 

or deferment of payment of the 

regulatory fee.281 However, timely 

submission of the required regulatory 

fee must accompany requests for 

waivers or reductions. This will avoid 

any late payment penalty if the request 

is denied. The fee will be refunded if 

the request is granted. In exceptional 

and compelling instances (where 

payment of the regulatory fee along with 

the waiver or reduction request could 

result in reduction of service to a 

community or other financial hardship 

to the licensee), the Commission will 

defer payment in response to a request 

filed with the appropriate supporting 

documentation. 

V. Steps Taken To Minimize Significant 

Economic Impact on Small Entities, and 

Significant Alternatives Considered 

126. 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: (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.282 In the NPRM, we 

have sought comment on alternatives 

that might simplify our fee procedures 

or otherwise benefit filers, including 

small entities, while remaining 

consistent with our statutory 

responsibilities in this proceeding. 

127. Several categories of licensees 

and regulatees are exempt from payment 

of regulatory fees. Also, waiver 

procedures provide regulatees, 

including small entity regulatees, relief 

in exceptional circumstances. 

VI. Federal Rules That May Duplicate, 

Overlap, or Conflict With the Proposed 

Rules 

None. 

Proposed Letter to Submarine Cable 

Operators 

[insert address of submarine cable 

operator] 

Re: Regulatory Fees for Fiscal Year 

[insert year] 

Our annual regulatory fee assessment 

for submarine cable operators is based 

on the total capacity for the submarine 

cable system. For this reason, we require 

submarine cable operators to advise us 

of the appropriate category for 

determining regulatory fees. Please 

indicate below the correct category and 

return this letter to us by February 15, 

20_. 

Submarine Cable Systems 

(capacity as of December 31) 

Please 

check the 

appropriate category 

< 2.5 Gbps ................

2.5 Gbps or greater, but less than 

5 Gbps ................

5 Gbps or greater, but less than 

10 Gbps ................

10 Gbps or greater, but less than 

20 Gbps ................

20 Gbps or greater ................

Thank you for your assistance in this 

matter. 

CERTIFICATION STATEMENT 

I llllllllllllcertify under 

penalty of perjury that the foregoing and 

supporting information is true and 

correct to the best of my knowledge, 

information and belief. 

SIGNATURE llllllllllll

DATE lllllllllllllll

Sources of Payment Unit Estimates for 

FY 2009 

In order to calculate individual 

service fees for FY 2009, we adjusted FY 

2008 payment units for each service to 

more accurately reflect expected FY 

2009 payment liabilities. We obtained 

our updated estimates through a variety 

of means. For example, we used 

Commission licensee databases, actual 

prior year payment records and industry 

and trade association projections when 

available. The databases we consulted 

include our Universal Licensing System 

(‘‘ULS’’), International Bureau Filing 

System (‘‘IBFS’’), Consolidated Database 

System (‘‘CDBS’’) and Cable Operations 

and Licensing System (‘‘COALS’’), as 

well as reports generated within the 

Commission such as the Wireline 

26350 Federal Register / Vol. 74, No. 104 / Tuesday, June 2, 2009 / Proposed Rules 

Competition Bureau’s Trends in 

Telephone Service and the Wireless 

Telecommunications Bureau’s 

Numbering Resource Utilization 

Forecast. 

We tried to obtain verification for 

these estimates from multiple sources 

and, in all cases; we compared FY 2009 

estimates with actual FY 2008 payment 

units to ensure that our revised 

estimates were reasonable. Where 

appropriate, we adjusted and/or 

rounded our final estimates to take into 

consideration the fact that certain 

variables that impact on the number of 

payment units cannot yet be estimated 

exactly. These include an unknown 

number of waivers and/or exemptions 

that may occur in FY 2009 and the fact 

that, in many services, the number of 

actual licensees or station operators 

fluctuates from time to time due to 

economic, technical, or other reasons. 

When we note, for example, that our 

estimated FY 2009 payment units are 

based on FY 2008 actual payment units, 

it does not necessarily mean that our FY 

2009 projection is exactly the same 

number as FY 2008. We have either 

rounded the FY 2009 number or 

adjusted it slightly to account for these 

variables. 

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1 47 CFR 73.150 and 73.152. 

2See Map of Estimated Effective Ground 

Conductivity in the United States, 47 CFR 73.190 

Figure R3. 

Factors, Measurements, and 

Calculations That Go Into Determining 

Station Signal Contours and Associated 

Population Coverages 

AM Stations 

For stations with nondirectional 

daytime antennas, the theoretical 

radiation was used at all azimuths. For 

stations with directional daytime 

antennas, specific information on each 

day tower, including field ratio, 

phasing, spacing and orientation was 

retrieved, as well as the theoretical 

pattern root-mean-square of the 

radiation in all directions in the 

horizontal plane (‘‘RMS’’) figure 

milliVolt per meter (mV/m) @ 1 km) for 

the antenna system. The standard, or 

modified standard if pertinent, 

horizontal plane radiation pattern was 

calculated using techniques and 

methods specified in sections 73.150 

and 73.152 of the Commission’s rules.1

Radiation values were calculated for 

each of 360 radials around the 

transmitter site. Next, estimated soil 

conductivity data was retrieved from a 

database representing the information in 

FCC Figure R3.2 Using the calculated 

horizontal radiation values, and the 

retrieved soil conductivity data, the 

distance to the principal community (5 

mV/m) contour was predicted for each 

of the 360 radials. The resulting 

distance to principal community 

contours were used to form a 

geographical polygon. Population 

counting was accomplished by 

determining which 2000 block centroids 

were contained in the polygon. (A block 

centroid is the center point of a small 

area containing population as computed 

by the U.S. Census Bureau.) The sum of 

the population figures for all enclosed 

blocks represents the total population 

for the predicted principal community 

coverage area. 

FM Stations 

The greater of the horizontal or 

vertical effective radiated power 

(‘‘ERP’’) (kW) and respective height 

above average terrain (‘‘HAAT’’) (m) 

combination was used. Where the 

antenna height above mean sea level 

(‘‘HAMSL’’) was available, it was used 

in lieu of the average HAAT figure to 

calculate specific HAAT figures for each 

of 360 radials under study. Any 

available directional pattern information 

was applied as well, to produce a radialspecific ERP figure. The HAAT and ERP 

figures were used in conjunction with 


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3 47 CFR 73.313. 

the Field Strength (50–50) propagation 

curves specified in 47 CFR section 

73.313 of the Commission’s rules to 

predict the distance to the principal 

community (70 dBu (decibel above 1 

microVolt per meter) or 3.17 mV/m) 

contour for each of the 360 radials.3 The 

resulting distance to principal 

community contours were used to form 

a geographical polygon. Population 

counting was accomplished by 

determining which 2000 block centroids 

were contained in the polygon. The sum 

of the population figures for all enclosed 

blocks represents the total population 

for the predicted principal community 

coverage area. 


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283As discussed previously herein, we recently 

revised the Commission’s IBC fee rules by adopting 

a new methodology for calculating regulatory fees 

on both common carrier and non-common carrier 

international submarine cable systems based on a 

per system fee. See Submarine Cable Order. Under 

section 9(b)(4)(B) of the Act, we must notify 

Congress 90 days before a permitted amendment to 

the regulatory fees can take effect. The 90 day 

period will elapse as of July 15, 2009. For this 

reason, we are calculating proposed regulatory fees 

for FY 2009 for this service using both the new 

methodology and the old (pre-FY 2009) 

methodology. Appendix A contains the proposed 

regulatory fees for international based on the new 

methodology adopted in the Submarine Cable 

Order. See Appendix I for the proposed regulatory 

fees for international submarine cable systems 

based on the current methodology which remains 

in effect pending the Congressional notification 

process. If the 90 day period elapses without 

Congressional objection to the permitted 

amendment, we will use the new methodology 

contained in Appendix A to calculate submarine 

cable fees in our FY 2009 report and order. 

Terrestrial and satellite facilities do not have cable 

landing licenses and will continue to pay regulatory 

fees on a per 64KB circuit basis, under our historic 

methodology as revised in the Submarine Cable 

Order. See Submarine Cable Order at paragraph 20. 

Statement of Acting Chairman Michael 

J. Copps 

Re: Assessment and Collection of 

Regulatory Fees for Fiscal Year 

2009, MD Docket No. 09–65, 

Assessment and Collection of 

Regulatory Fees for Fiscal Year 

2008, MD Docket No. 08–65. 

This item begins the process of 

assessing regulatory fees for this fiscal 

year (FY 2009) pursuant to Section 9 of 

the Communications Act. Section 9 

requires that the Commission collect 

fees each year to recover the regulatory 

costs that are associated with its 

enforcement, policy and rulemaking, 

user information, and international 

activities. 

I am particularly pleased that the 

Notice of Proposed Rulemaking 

includes the new methodology for 

calculating regulatory fees for 

submarine cable operators finally 

adopted by the Commission in March. 

Implementing this new methodology, 

however, is only a precursor of our 

completion of a long overdue, 

comprehensive review of the 

Commission’s regulatory fee framework, 

a project that my colleague Jonathan 

Adelstein and I have been pushing for 

years and that was finally launched by 

the Commission last August. As I have 

said before, it is hard to believe that we 

are still generally assessing fees based 

on the communications marketplace as 

it existed in 1994. To be frank, we are 

not yet able to say what a modernized 

fee structure will look like. But I do 

intend to press the Commission for 

action on this before we issue next 

year’s Notice of Proposed Rulemaking 

for FY 2010. I look forward to working 

with my fellow Commissioners and 

interested stakeholders to update our 

rules to accurately and equitably reflect 

today’s regulatory practices. 

Federal Communications Commission. 

Marlene H. Dortch, 

Secretary. 

Proposed Rules for FY 2009 

International Bearer Circuit Fees 283

List of Subjects in 47 CFR Part 1 

Administrative practice and 

procedure, Claims, Communications 

common carriers, Penalties, Reporting 

and recordkeeping requirements. 

For the reasons discussed in the 

preamble, the Federal Communications 

Commission proposes to amend 47 CFR 

part 1 as follows: 

PART 1—PRACTICE AND 

PROCEDURE 

1. The authority citation for Part 1 

continues to read as follows: 

Authority: 47 U.S.C. 151, 154(i), 154(j), 

155, 225, 303, 309. 

2. The FCC proposes to further amend 

the final rule published at 74 FR 22110, 

May 12, 2009, and effective July 13, 

2009, in § 1.1156, by revising 

paragraphs (b) and (c) to read as follows: 

§ 1.1156 Schedule of regulatory fees and 

filing locations for international services 

* * * * * 

(b) International Terrestrial and 

Satellite. Regulatory fees for 

International Bearer Circuits are to be 

paid by facilities-based common carriers 

that have active (used or leased) 

international bearer circuits as of 

December 31, of the prior year in any 

terrestrial or satellite transmission 

facility for the provision of service to an 

end user or resale carrier, which 

includes active circuits to themselves or 

to their affiliates. 

In addition, non-common carrier 

satellite operators must pay a fee for 

each circuit sold or leased to any 

customer, including themselves or their 

affiliates, other than an international 

common carrier authorized by the 

Commission to provide U.S. 

international common carrier services. 

‘‘Active circuits’’ for these purposes 

include backup and redundant circuits. 

In addition, whether circuits are used 

specifically for voice or data is not 

relevant in determining that they are 

active circuits. 

Note to paragraph (b): The fee amount, per 

active 64 KB circuit or equivalent will be 

determined for each fiscal year. Payment, if 

mailed, shall be sent to: FCC, International, 

P.O. Box 979084, St. Louis, MO 63197–9000. 

International Terrestrial and Satellite 

(capacity as of December 31, 2008) Fee amount Address 

Terrestrial Common Carrier ................................

Satellite Common Carrier 

Satellite Non-Common Carrier 

$0.75 per 64 KB Circuit ................................... FCC, International, P.O. Box 979084, St. 

Louis, MO 63197–9000. 

(c) Submarine cable: Regulatory fees 

for submarine cable systems will be 

paid annually, per cable landing license, 

for all submarine cable systems 

operating as of December 31 of the prior 

year. The fee amount will be determined 

by the Commission for each fiscal year. 

Payment, if mailed, shall be sent to: 

FCC, International, P.O. Box 979084, St. 

Louis, MO 63197–9000. 

Submarine Cable Systems 

(capacity as of December 31) Fee amount Address 

< 2.5 Gbps .................................................................................. $14,189 FCC, International, P.O. Box 979084, St. Louis, MO 63197– 

9000. 

2.5 Gbps or greater, but less than 5 Gbps ................................ 28,379 FCC, International, P.O. Box 979084, St. Louis, MO 63197– 

9000. 

5 Gbps or greater, but less than 10 Gbps ................................. 56,757 FCC, International, P.O. Box 979084, St. Louis, MO 63197– 

9000. 

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Submarine Cable Systems 

(capacity as of December 31) Fee amount Address 

10 Gbps or greater, but less than 20 Gbps ............................... 113,514 FCC, International, P.O. Box 979084, St. Louis, MO 63197– 

9000. 

20 Gbps or greater ..................................................................... 227,029 FCC, International, P.O. Box 979084, St. Louis, MO 63197– 

9000. 

[FR Doc. E9–12594 Filed 6–1–09; 8:45 am] 

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