[Federal Register Volume 74, Number 104 (Tuesday, June 2, 2009)]
[Proposed Rules]
[Pages 26329-26360]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-12594]


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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.

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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:
    <bullet> Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
    <bullet> Federal Communications Commission's Web Site: http://www.fcc.gov/cgb/ecfs. Follow the instructions for submitting comments.
    <bullet> E-mail: <a href="/cdn-cgi/l/email-protection#c4a1a7a2b784a2a7a7eaa3abb2"><span class="__cf_email__" data-cfemail="187d7b7e6b587e7b7b367f776e">[email protected]</span></a>. Include MD Docket No. 09-65 in the 
subject line of the message.
    <bullet> 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
 
                                                               Paragraph
                           Heading                                No.
 
I. INTRODUCTION.............................................           1
II. NOTICE OF PROPOSED RULEMAKING...........................           2
    A. FY 2009 Regulatory Fee Assessment Methodology--                 2
     Development of FY 2009 Regulatory Fees.................
    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

[[Page 26330]]

 
            b. Future Streamlining of the Regulatory Fee              17
             Assessment and Collection Process..............
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            27
         (``ITSP'').........................................
    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
    <bullet> Initial Regulatory Flexibility Analysis........
    <bullet> Proposed Letter to Submarine Cable Operators...
    <bullet> Sources of Payment Unit Estimates for FY 2009..
    <bullet> Calculation of FY 2009 Revenue Requirements and
     Pro-Rata Fees..........................................
    <bullet> Proposed FY 2009 Schedule of Regulatory Fees...
    <bullet> Factors, Measurements, and Calculations That Go
     Into Determining Station Signal Contours and Associated
     Population Coverages...................................
    <bullet> FY 2008 Schedule of Regulatory Fees............
    <bullet> 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 
nation-wide digital transition date.
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    \1\ 47 U.S.C. 159(a)(1).
    \2\ See Omnibus Appropriations Act, 2009, Public Law 111-8.
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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 August-September 2009 time frame in order to collect the 
required amount by the end of the fiscal year.
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    \3\ See Omnibus Appropriations Act, 2009, Public Law 111-8.
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    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

[[Page 26331]]

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.
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    \4\ We 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 non-common 
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.
    \5\ See Appendix H for the proposed FY 2009 regulatory fee 
assessment methodology, including a comparison to the FY 2008 
results.
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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.
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    \6\ See 47 CFR 1.1153.
    \7\ See 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'').
    \8\ FY 2008 Report and Order at paragraphs 44-46.
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    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 full-power 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.
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    \9\ See 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'').
    \10\ See 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'').
    \11\ The 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.
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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\
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    \12\ We 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.
    \13\ See 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).
    \14\ See 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).
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    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

[[Page 26332]]

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.
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    \15\ On 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.
    \16\ See 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.
    \17\ See 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).
    \19\ A carrier may have both common carrier and non-common 
carrier circuits.
    \20\ Terrestrial 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.
    \21\ See 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/.
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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.
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    \22\ Fee Filer can be accessed at http://www.fcc.gov/fees/feefiler.html.
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    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 Non-Geostationary (``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, pre-bill 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 pre-bills to ITSP providers, GSO and NGSO

[[Page 26333]]

licensees, CARS licensees, and earth station licensees.
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    \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.
    \24\ An 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.
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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, e-mail, 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 per-facility 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 fee-exempt status.\28\
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    \25\ An 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.
    \26\ Some 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 fee-
exempt 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.
    \27\ We 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.
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    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.
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    \29\ See 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.
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    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

[[Page 26334]]

initial assessment letter, the Commission will assess the carrier for 
the difference between what was paid and what should have been paid.
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    \31\ See, e.g., Federal Communications Commission, Regulatory 
Fees Fact Sheet: What You Owe--Commercial Wireless Services for FY 
2008 at 1 (rel. Aug. 2008).
---------------------------------------------------------------------------

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.
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    \32\ See 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).
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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:
    <bullet> 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.
    <bullet> 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\
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    \33\ Audio 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'').
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    <bullet> 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.
    <bullet> 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.
    <bullet> 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.
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    \34\ Cable 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.
---------------------------------------------------------------------------

    <bullet> 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

[[Page 26335]]

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.
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    \35\ See Submarine Cable Order.
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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.
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    \36\ 47 U.S.C. 159(c).
    \37\ See 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).
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    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).
---------------------------------------------------------------------------

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

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.''
---------------------------------------------------------------------------

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

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 two-sentence 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).
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    \42\ See 47 CFR 1.1206(b); see also 47 CFR 1.1202, 1.1203.
    \43\ See 47 CFR 1.1206(b)(2).
---------------------------------------------------------------------------

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\
---------------------------------------------------------------------------

    \44\ See 47 CFR 1.415, 1.419.
    \45\ See Electronic Filing of Documents in Rulemaking 
Proceedings, 13 FCC Rcd 11322 (1998).
---------------------------------------------------------------------------

    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 e-mail to <a href="/cdn-cgi/l/email-protection#fd989e9b8ebd9b9e9ed39a928b"><span class="__cf_email__" data-cfemail="4f2a2c293c0f292c2c61282039">[email protected]</span></a>, and include the

[[Page 26336]]

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.
    <bullet> The Commission's contractor will receive hand-delivered or 
messenger-delivered 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.
    <bullet> 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.
    <bullet> 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 e-mail to <a href="/cdn-cgi/l/email-protection#4e282d2d7b7e7a0e282d2d60292138"><span class="__cf_email__" data-cfemail="20464343151014604643430e474f56">[email protected]</span></a> 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\
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    \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.
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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\
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    \49\ 47 U.S.C. 154(i) and (j), 159, and 303(r).
---------------------------------------------------------------------------

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\
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    \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.
---------------------------------------------------------------------------

    51. Small Businesses. Nationwide, there are a total of 22.4 million 
small businesses, according to SBA data.\54\
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    \54\ See SBA, Programs and Services, SBA Pamphlet No. CO-0028, 
at p. 40 (July 2002).
---------------------------------------------------------------------------

    52. Small Organizations. Nationwide, there are approximately 1.6 
million small organizations.\55\
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    \55\ Independent Sector, The New Nonprofit Almanac & Desk 
Reference (2002).
---------------------------------------------------------------------------

    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

[[Page 26337]]

most governmental jurisdictions are small.
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    \56\ 5 U.S.C. 601(5).
    \57\ U.S. Census Bureau, Statistical Abstract of the United 
States: 2006, Section 8, p. 272, Table 415.
    \58\ We 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 governments nationwide was 
38,967, of which 35,819 were small. Id.
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    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.
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    \59\ 15 U.S.C. 632.
    \60\ Letter 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).
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    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.
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    \61\ 13 CFR 121.201, North American Industry Classification 
System (NAICS) code 517110.
    \62\ FCC, 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'').
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    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, 
``Shared-Tenant Service Providers,'' and ``Other Local Service 
Providers'' are small entities that may be affected by our proposed 
action.
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    \63\ 13 CFR 121.201, NAICS code 517110.
    \64\ ``Trends in Telephone Service'' at Table 5.3.
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    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.
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    \65\ 13 CFR 121.201, NAICS code 517310.
    \66\ ``Trends in Telephone Service'' at Table 5.3.
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    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.
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    \67\ 13 CFR 121.201, NAICS code 517310.
    \68\ ``Trends in Telephone Service'' at Table 5.3.
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    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.
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    \69\ 3 CFR 121.201, NAICS code 517110.
    \70\ ``Trends in Telephone Service'' at Table 5.3.
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    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.
---------------------------------------------------------------------------

    \71\ 13 CFR 121.201, NAICS code 517110.
    \72\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    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.
---------------------------------------------------------------------------

    \73\ 13 CFR 121.201, NAICS code 517110.
    \74\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    62. Prepaid Calling Card Providers. Neither the Commission nor the 
SBA

[[Page 26338]]

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.
---------------------------------------------------------------------------

    \75\ 13 CFR 121.201, NAICS code 517310.
    \76\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    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.
---------------------------------------------------------------------------

    \77\ We 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.
---------------------------------------------------------------------------

    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\
---------------------------------------------------------------------------

    \80\ 13 CFR 121.201, NAICS codes 517410 and 517910.
---------------------------------------------------------------------------

    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.
---------------------------------------------------------------------------

    \81\ U.S. Census Bureau, 2002 NAICS Definitions, ``517410 
Satellite Telecommunications''; http://www.census.gov/epcd/naics02/def/NDEF517.HTM.
    \82\ U.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.
---------------------------------------------------------------------------

    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.
---------------------------------------------------------------------------

    \84\ U.S. Census Bureau, 2002 NAICS Definitions, ``517910 Other 
Telecommunications''; http://www.census.gov/epcd/naics02/def/NDEF517.HTM.
    \85\ U.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.
---------------------------------------------------------------------------

    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.
---------------------------------------------------------------------------

    \87\ 13 CFR 121.201, NAICS code 517211.
    \88\ 13 CFR 121.201, NAICS code 517212.
    \89\ U.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.''
    \91\ U.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.''
---------------------------------------------------------------------------

    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

[[Page 26339]]

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.
---------------------------------------------------------------------------

    \93\ Office 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.
    \95\ U.S. Census Bureau, 1997 Economic Census, Subject Series: 
``Information,'' Table 4, Receipts Size of Firms Subject to Federal 
Income Tax: 1997, NAICS code 514191.
    \96\ U.S. Census Bureau, 1997 Economic Census, Subject Series: 
``Information,'' Table 4, Receipts Size of Firms Subject to Federal 
Income Tax: 1997, NAICS code 514191.
---------------------------------------------------------------------------

    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.
---------------------------------------------------------------------------

    \97\ 13 CFR 121.201, NAICS code 517211.
    \98\ 13 CFR 121.201, NAICS code 517212.
    \99\ U.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.''
    \101\ U.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.''
---------------------------------------------------------------------------

    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.
---------------------------------------------------------------------------

    \103\ 13 CFR 121.201, NAICS code 517212.
    \104\ U.S. Census Bureau, 1997 Economic Census, Subject Series: 
``Information,'' Table 5, Employment Size of Firms Subject to 
Federal Income Tax: 1997, NAICS code 513321.
    \105\ U.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.''
---------------------------------------------------------------------------

    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\
---------------------------------------------------------------------------

    \106\ Revision 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).
    \107\ Paging Second Report and Order, 12 FCC Rcd at 2811, 
paragraph 179.
    \108\ See 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'').
    \109\ See ``929 and 931 MHz Paging Auction Closes,'' Public 
Notice, 15 FCC Rcd 4858 (WTB 2000).
    \110\ See id.
    \111\ See ``Lower and Upper Paging Band Auction Closes,'' Public 
Notice, 16 FCC Rcd 21821 (WTB 2002).
    \112\ See ``Lower and Upper Paging Bands Auction Closes,'' 
Public Notice, 18 FCC Rcd 11154 (WTB 2003).
---------------------------------------------------------------------------

    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.
---------------------------------------------------------------------------

    \113\ ``Trends in Telephone Service'' at Table 5.3.
    \114\ ``Trends in Telephone Service'' at Table 5.3.
---------------------------------------------------------------------------

    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.
---------------------------------------------------------------------------

    \115\ Amendment 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).
    \116\ See Alvarez Letter 1998.
---------------------------------------------------------------------------

    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

[[Page 26340]]

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.
---------------------------------------------------------------------------

    \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.
---------------------------------------------------------------------------

    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\
---------------------------------------------------------------------------

    \121\ See 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).
    \122\ See PCS Report and Order, 11 FCC Rcd at 7852, para. 60.
    \123\ See Alvarez Letter 1998.
    \124\ FCC News, ``Broadband PCS, D, E and F Block Auction 
Closes,'' No. 71744 (rel. Jan. 14, 1997).
    \125\ See ``C, D, E, and F Block Broadband PCS Auction Closes,'' 
Public Notice, 14 FCC Rcd 6688 (WTB 1999).
---------------------------------------------------------------------------

    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\
---------------------------------------------------------------------------

    \126\ See ``C and F Block Broadband PCS Auction Closes; Winning 
Bidders Announced,'' Public Notice, 16 FCC Rcd 2339 (2001).
    \127\ See ``Broadband PCS Spectrum Auction Closes; Winning 
Bidders Announced for Auction No. 58,'' Public Notice, 20 FCC Rcd 
3703 (2005).
    \128\ See ``Auction of Broadband PCS Spectrum Licenses Closes; 
Winning Bidders Announced for Auction No. 71,'' Public Notice, 22 
FCC Rcd 9247 (2007).
    \129\ Id.
---------------------------------------------------------------------------

    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.
---------------------------------------------------------------------------

    \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).
    \131\ See ``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).
    \132\ Amendment 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'').
    \133\ Narrowband PCS Second Report and Order, 15 FCC Rcd at 
10476, para. 40.
    \134\ Id.
    \135\ See Alvarez Letter 1998.
    \136\ See ``Narrowband PCS Auction Closes,'' Public Notice, 16 
FCC Rcd 18663 (WTB 2001).
---------------------------------------------------------------------------

    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

[[Page 26341]]

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.
---------------------------------------------------------------------------

    \137\ See 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'').
    \138\ See Channels 52-59 Report and Order, 17 FCC Rcd at 1087-
88, paragraph 172.
    \139\ See id.
    \140\ See id, 17 FCC Rcd at 1088, paragraph 173.
    \141\ See Letter from Aida Alvarez, Administrator, SBA, to 
Thomas Sugrue, Chief, WTB, FCC (Aug. 10, 1999) (``Alvarez Letter 
1999'').
    \142\ See ``Lower 700 MHz Band Auction Closes,'' Public Notice, 
17 FCC Rcd 17272 (WTB 2002).
    \143\ See ``Lower 700 MHz Band Auction Closes,'' Public Notice, 
18 FCC Rcd 11873 (WTB 2003).
    \144\ See id.
---------------------------------------------------------------------------

    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).
---------------------------------------------------------------------------

    \145\ Service 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'').
    \146\ See ``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).
---------------------------------------------------------------------------

    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).
---------------------------------------------------------------------------

    \147\ See id.
---------------------------------------------------------------------------

    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\
---------------------------------------------------------------------------

    \148\ See 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'').
    \149\ See 746-764 MHz Band Second Report and Order, 15 FCC Rcd 
at 5343, para. 108.
    \150\ See id.
    \151\ See 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).
    \152\ See ``700 MHz Guard Bands Auction Closes: Winning Bidders 
Announced,'' Public Notice, 15 FCC Rcd 18026 (2000).
    \153\ See ``700 MHz Guard Bands Auction Closes: Winning Bidders 
Announced,'' Public Notice, 16 FCC Rcd 4590 (WTB 2001).
---------------------------------------------------------------------------

    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\
---------------------------------------------------------------------------

    \154\ 47 CFR 90.814(b)(1).
    \155\ 47 CFR 90.814(b)(1).
    \156\ See Alvarez Letter 1999.
    \157\ See ``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).
    \158\ See ``Multi-Radio Service Auction Closes,'' Public Notice, 
17 FCC Rcd 1446 (WTB 2002).
---------------------------------------------------------------------------

    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

[[Page 26342]]

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.
---------------------------------------------------------------------------

    \159\ See ``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).
    \160\ See, ``800 MHz SMR Service Lower 80 Channels Auction 
Closes; Winning Bidders Announced,'' Public Notice, 16 FCC Rcd 1736 
(2000).
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    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.
---------------------------------------------------------------------------

    \161\ 13 CFR 121.201, NAICS code 517212.
---------------------------------------------------------------------------

    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\
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    \162\ Amendment 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.
    \165\ See 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).
    \167\ See ``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).
    \168\ See ``Phase II 220 MHz Service Spectrum Auction Closes,'' 
Public Notice, 14 FCC Rcd 11218 (1999).
    \169\ See ``Multi-Radio Service Auction Closes,'' Public Notice, 
17 FCC Rcd 1446 (2002).
    \170\ See ``Auction of Phase II 220 MHz Service Spectrum 
Licenses Closes,'' Public Notice, 22 FCC Rcd 11573 (WTB 2007).
---------------------------------------------------------------------------

    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\
---------------------------------------------------------------------------

    \171\ See 13 CFR 121.201, NAICS code 517212.
    \172\ See generally 13 CFR 121.201.
---------------------------------------------------------------------------

    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.
---------------------------------------------------------------------------

    \173\ Federal Communications Commission, 60th Annual Report, 
Fiscal Year 1994, at paragraph 116.
---------------------------------------------------------------------------

    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

[[Page 26343]]

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.
---------------------------------------------------------------------------

    \174\ See 47 CFR 101 et seq. for common carrier fixed microwave 
services (except Multipoint Distribution Service).
    \175\ Persons eligible under parts 80 and 90 of the Commission's 
Rules can use Private Operational-Fixed Microwave services. See 47 
CFR Parts 80 and 90. Stations in this service are called 
operational-fixed 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.
    \176\ Auxiliary 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.
    \177\ 13 CFR 121.201, NAICS code 517212.
---------------------------------------------------------------------------

    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.
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    \178\ See 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.
    \180\ See 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).
---------------------------------------------------------------------------

    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 re-auctioned 161 licenses; 
there were 32 small and very small businesses winning that won 119 
licenses.
---------------------------------------------------------------------------

    \181\ See 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'').
    \182\ See LMDS Second Report and Order, 12 FCC Rcd at 12689-90, 
paragraph 348.
    \183\ See id.
    \184\ See Alvarez to Phythyon Letter 1998.
---------------------------------------------------------------------------

    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.
---------------------------------------------------------------------------

    \185\ See ``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).
    \187\ Amendment 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.
    \189\ See Alvarez to Phythyon Letter 1998.
---------------------------------------------------------------------------

    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.
---------------------------------------------------------------------------

    \190\ Amendment 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.
    \191\ Automatic Vehicle Monitoring Systems Second Report and 
Order, 13 FCC Rcd at 15192, para. 20; see also 47 CFR 90.1103.
    \192\ See Alvarez Letter 1998.
---------------------------------------------------------------------------

    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

[[Page 26344]]

may be affected by the rules and policies proposed herein.
---------------------------------------------------------------------------

    \193\ The service is defined in section 22.99 of the 
Commission's rules, 47 CFR 22.99.
    \194\ BETRS 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.
---------------------------------------------------------------------------

    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.
---------------------------------------------------------------------------

    \196\ The service is defined in section 22.99 of the 
Commission's rules, 47 CFR 22.99.
    \197\ 13 CFR 121.201, NAICS codes 517212.
    \198\ Amendment 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.
    \200\ See Letter from Hector V. Barreto, Administrator, SBA, to 
Gary D. Michaels, Deputy Chief, Auctions and Spectrum Access 
Division, WTB, FCC (Sept. 19, 2005).
---------------------------------------------------------------------------

    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.
---------------------------------------------------------------------------

    \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.
    \203\ A licensee may have a license in more than one category.
    \204\ Amendment 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).
    \205\ See ``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.
---------------------------------------------------------------------------

    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\
---------------------------------------------------------------------------

    \207\ This 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.
---------------------------------------------------------------------------

    99. Multiple Address Systems (``MAS''). Entities using MAS 
spectrum, in general, fall into two categories: (1) Those using the 
spectrum for profit-based 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

[[Page 26345]]

of 2,323 licenses. Of the 26 winning bidders in this auction, five 
claimed small business status and won 1,891 licenses.
---------------------------------------------------------------------------

    \210\ See Amendment of the Commission's Rules Regarding Multiple 
Address Systems, Report and Order, 15 FCC Rcd 11956, 12008, 
paragraph 123 (2000).
    \211\ Id.
    \212\ See Alvarez Letter 1999.
    \213\ See ``Multiple Address Systems Spectrum Auction Closes,'' 
Public Notice, 16 FCC Rcd 21011 (2001).
---------------------------------------------------------------------------

    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.
---------------------------------------------------------------------------

    \214\ See 13 CFR 121.201, NAICS code 517212.
---------------------------------------------------------------------------

    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\
---------------------------------------------------------------------------

    \215\ See ``Auction of 1.4 GHz Bands Licenses Scheduled for 
February 7, 2007,'' Public Notice, 21 FCC Rcd 12393 (WTB 2006).
    \216\ See ``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'').
    \217\ Auction No. 69 Closing PN, Attachment C.
    \218\ See Auction No. 69 Closing PN.
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    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.
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    \219\ 13 CFR 121.201, NAICS code 517212.
    \220\ U.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.''
    \222\ U.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.''
    \224\ Teligent 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.
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    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.
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    \225\ Amendments 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).
    \227\ See Letter from Gary M. Jackson, Assistant Administrator, 
SBA, to Margaret W. Wiener, Deputy Chief, Auctions and Industry 
Analysis Division, WTB, FCC (July 28, 2000).
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    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

[[Page 26346]]

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.
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    \228\ Amendment 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.
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    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.
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    \231\ 13 CFR 121.201, NAICS code 517510.
    \232\ U.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.
    \234\ The 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.
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    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.
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    \235\ U.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).
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    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.
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    \238\ FCC News Release, ``Broadcast Station Totals as of 
September 30, 2007.''
---------------------------------------------------------------------------

    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.
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    \239\ See 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).
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    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\
---------------------------------------------------------------------------

    \243\ 13 CFR 121.201, NAICS codes 513111 and 513112.
---------------------------------------------------------------------------

    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\
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    \244\ See supra note 242.
    \245\ 15 U.S.C. 632.
---------------------------------------------------------------------------

    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

[[Page 26347]]

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.
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    \246\ U.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.
    \248\ U.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.
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    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.
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    \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).
    \251\ These 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).
    \253\ Warren 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.
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    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.
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    \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).
    \256\ These 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.
    \257\ The 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).
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    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.
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    \258\ See 47 U.S.C. 573.
    \259\ 13 CFR 121.201, NAICS code 517510.
    \260\ \\ See http://www.fcc.gov/csb/ovs/csovscer.html.
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    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.
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    \261\ 13 CFR 121.201, NAICS code 517510.
    \262\ U.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.
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    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,

[[Page 26348]]

2004, 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\
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    \264\ Amendment 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).
    \265\ See 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).
    \266\ See ``Multichannel Video Distribution and Data Service 
Auction Closes,'' Public Notice, 19 FCC Rcd 1834 (2004).
    \267\ See ``Auction of Multichannel Video Distribution and Data 
Service Licenses Closes; Winning Bidders Announced for Auction No. 
63,'' Public Notice, 20 FCC Rcd 19807 (2005).
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    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.
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    \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).
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    120. Personal Radio Services. Personal radio services provide 
short-range, 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.
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    \270\ 47 CFR Part 90.
    \271\ The 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.
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    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\
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    \273\ With 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).
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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

[[Page 26349]]

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.
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    \276\ See 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 non-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.
---------------------------------------------------------------------------

    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\
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    \277\ 47 CFR 1.1164.
    \278\ 47 CFR 1.1164(c).
    \279\ Public Law 104-134, 110 Stat. 1321 (1996).
    \280\ 31 U.S.C. 7701(c)(2)(B).
---------------------------------------------------------------------------

    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.
---------------------------------------------------------------------------

    \281\ 47 CFR 1.1166.
---------------------------------------------------------------------------

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.
---------------------------------------------------------------------------

    \282\ 5 U.S.C. 603.
---------------------------------------------------------------------------

    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--.

------------------------------------------------------------------------
                                                                Please
                                                              check the
    Submarine Cable Systems (capacity as of December 31)     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 ------------------------certify under penalty of perjury that the 
foregoing and supporting information is true and correct to the best of 
my knowledge, information and belief.

SIGNATURE--------------------------------------------------------------

DATE-------------------------------------------------------------------

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

[[Page 26350]]

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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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.
---------------------------------------------------------------------------

    \1\ 47 CFR 73.150 and 73.152.
    \2\ See Map of Estimated Effective Ground Conductivity in the 
United States, 47 CFR 73.190 Figure R3.
---------------------------------------------------------------------------

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 radial-specific ERP figure. The HAAT and ERP figures 
were used in conjunction with

[[Page 26357]]

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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    \3\ 47 CFR 73.313. 
    [GRAPHIC] [TIFF OMITTED] TP02JN09.008
    

[[Page 26358]]


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BILLING CODE 6712-01-C

[[Page 26359]]

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\
---------------------------------------------------------------------------

    \283\ As 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.
---------------------------------------------------------------------------

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 Sec.  1.1156, 
by revising paragraphs (b) and (c) to read as follows:


Sec.  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       Fee amount              Address
    of December 31, 2008)
------------------------------------------------------------------------
Terrestrial Common Carrier..  $0.75 per 64 KB       FCC, International,
Satellite Common Carrier....   Circuit.              P.O. Box 979084,
Satellite Non-Common Carrier                         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            28,379  FCC, International,
 than 5 Gbps.                                     P.O. Box 979084, St.
                                                  Louis, MO 63197-9000.
5 Gbps or greater, but less              56,757  FCC, International,
 than 10 Gbps.                                    P.O. Box 979084, St.
                                                  Louis, MO 63197-9000.

[[Page 26360]]

 
10 Gbps or greater, but less            113,514  FCC, International,
 than 20 Gbps.                                    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]
BILLING CODE 6712-01-P


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