Implementation of Section 9 of the Communications ActAssessment and Collection of Regulatory Fees for the 1994 Fiscal Year and Amendment of the Schedule of Application Fees; Rules FEDERAL COMMUNICATIONS COMMISSION

SUMMARY: The Commission has adopted rules to implement section 9 of the

Communications Act of 1934 to provide for the annual assessment and

collection of regulatory fees. For fiscal year 1994, the Commission is

required to utilize the Schedule of Regulatory Fees that Congress

established in section 9(g) of the Act. The implementation of

regulatory fees will further the National Performance Review goals of

reinventing Government by requiring beneficiaries of Commission

services to pay for such services.

EFFECTIVE DATE: July 18, 1994.

FOR FURTHER INFORMATION CONTACT:

H. Walker Feaster, Office of Managing Director at (202) 632-0923.

SUPPLEMENTARY INFORMATION:

Report and Order

Adopted: June 3, 1994.

Released: June 8, 1994.

By the Commission: Commissioner Quello issuing a statement;

Commissioners Ness and Chong not participating.

Table of Contents

I. Introduction

II. Background

III. Discussion

A. Assessment of Regulatory Fees for FY 1994

B. Exemptions from Regulatory Fees

1. Governmental Entities

2. Nonprofit Entities

3. Amateur Licensees

4. Noncommercial Educational Broadcasters

5. Public Safety Services

6. Certification of Exempt Status

C. Waivers, Reductions and Deferments

D. Procedures for Payment

1. Categories of Payors

2. Installment Payments

3. Advance Payments

4. Timing of Payment

5. Method and Location of Payment

6. Multiple Payments

7. Electronic Payments

E. Enforcement

1. Penalties for Late Payment

2. Dismissal of Application

3. Revocation

4. Debt Collection Act Remedies

IV. Regulatory Fee Categories

A. Private Radio Services

1. Exclusive Use

2. Marine (Coast and Ship Stations)

3. General Mobile Radio Service

B. Mass Media Services

1. Broadcast Stations

2. Television Stations

3. Broadcast Auxiliary Stations

4. ITFS and DBS

C. Common Carrier Services

1. Cellular and Public Mobile Licensees

2. Air-Ground Radiotelephone Service

3. Space Stations

4. Earth Stations

5. Services Interexchange and Local Exchange

6. International Bearer Circuits

D. Cable Services

V. Amendments to Application Fee Rules

VI. Confidentiality

VII. Final Regulatory Analysis

VIII. Ordering Clauses

I. Introduction

1. By this Report and Order, the Commission adopts rules to

implement section 9 of the Communications Act, as amended, 47 U.S.C.

159, providing for the annual assessment and collection of regulatory

fees by the Commission.\1\ The Report and Order establishes the amounts

of the regulatory fees for Fiscal Year (FY) 1994 and the rules for the

payment of such fees for fiscal years 1994 and thereafter.\2\ Also, we

are amending several of the rules governing the collection of the fees

to be filed with applications and other filings pursuant to section 8

of the Communications Act, as amended, 47 U.S.C. 158.\3\

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\1\Section 9 of the Act was added by section 6002(a) of the

Omnibus Budget Reconciliation Act of 1993 (hereinafter ``1993 Budget

Act''). See Pub. L. No. 103-66, Title VI, 6002(a), 107 Stat. 397

(approved August 10, 1993). Section 9 is codified at 47 U.S.C.

section 159.

\2\As discussed below, we will establish the accounting systems

necessary to make adjustments in the Schedule of Regulatory Fees

required for the assessment of fees in future years in a subsequent

and separate rulemaking proceeding. See 47 U.S.C. 159(b)(3), (i).

\3\47 U.S.C. Sec. 158. See generally 47 CFR part 1, subpart G;

Establishment of a Fee Collection Program to Implement the

Provisions of the Consolidated Omnibus Budget Reconciliation Act of

1985, 2 FCC Rcd 947 (1987) (hereinafter ``Fees 1''), recon. granted

in part, 3 FCC Rcd 5987 (1988) (hereinafter ``Fees 1

Reconsideration''); Establishment of a Fee Collection Program to

Implement the Provisions of the Omnibus Budget Reconciliation Act of

1989, 5 FCC Rcd 3558 (1990) (hereinafter ``Fees II''), recon.

granted in part, 6 FCC Rcd 5919 (1991) (hereinafter ``Fees II

Reconsideration''). See also section 6003(a)(2) of the 1993 Budget

Act, Pub. L. 103-66, Title VI, Sec. 6003(a)(2), 107 Stat. 401 (1993)

(making conforming amendments to section 8).

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2. The rules we adopt below are designed to ensure that (1)

collection of fees does not adversely affect the Commission's

regulatory activities, (2) the most effective means possible are

employed in the collection and deposit of fees, and (3) the paperwork

(and financial burden) on the public resulting from our collection

process is kept to an absolute minimum. The accomplish this goal, we

have, to the extent possible, modeled our regulatory fee rules upon the

rules that we previously established to govern the collection of fees

filed with applications and other filings. See 47 CFR 1.1101 et seq.

Moreover, in the course of fashioning rules to govern regulatory fees,

we have revised several rules in order to improve the collection

process related to these fees and, wherever possible, to ease the

burden on those entities subject to the payment of these fees.

Implementation of rules governing the collection of regulatory fees

also furthers the National Performance Review goals of reinventing

government by requiring beneficiaries of the Commission's services to

pay the costs associated with these activities.

II. Background

3. Section 9(a) of the Communications Act requires the Commission

to collect regulatory fees to recover the annual cost of its

enforcement activities, policy and rulemaking activities, user

information services, and international activities. 47 U.S.C. 159(a).

47 U.S.C. 159(b)(1)(A). The Schedule of Regulatory Charges sets forth

in section 9(g) the categories of regulated entities subject initially

to the regulatory fee requirement and designates the fees to be

collected for each subject category of regulatee. 47 U.S.C. 159(g). The

Schedule of Fees sets forth annual regulatory fees for specific

categories of regulatees in Private Radio, Mass Media, Common Carrier

and Cable Services.\4\

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\4\Congress included the regulatory fees for cable services in

the Schedule of Regulatory Fees as a subpart of the fees established

to recover appropriations related to the regulation of mass media

services. 47 U.S.C. 159(g). Because we recently established a Cable

Services Bureau to administer the regulation of cable television

operations, we have amended our rules to set forth separately the

regulatory fees applicable to cable services. See section 1.1155, 47

CFR 1.1155.

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4. Section 9(f)(1) requires the Commission to adopt rules to

implement the assessment and collection of the annual regulatory fees.

47 U.S.C. 159(f)(1). On March 4, 1994, we adopted a Notice of Proposed

Rulemaking (``NPRM'') to implement section 9 of the Act.\5\ In the

NPRM, we concluded that Congress intended the Commission to rely upon

the Schedule of Regulatory Fees enacted in section 9(g) to recover

costs for FY 1994.

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\5\See Notice of Proposed Rulemaking in the Implementation of

Section 9 of the Communication Act, FCC 94-46, released March 11,

1994.

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5. In addition, the NPRM proposed rules providing for: (1)

Exemptions from the regulatory fee requirements for governmental

entities, nonprofit entities, amateur licensees, noncommercial

educational broadcasters, and licensees in the public safety services,

(2) standards for waiver, reduction and deferment of regulatory fees,

(3) procedures for the payment of regulatory fees, including the timing

and method of payments, and the location for submission of payments,

and (4) procedures to assure timely payment of regulatory fees,

including announcements in the Federal Register of the filing times for

the fee payments, and penalties for late payment and nonpayment of

fees.

III. Discussion

A. Assessment of Regulatory Fees for FY 1994

6. The NPRM proposed that for FY 1994, the Commission would utilize

the Schedule of Regulatory Fees established by Congress in section 9(g)

of the Act. 47 U.S.C. 159(g). In response to this proposal, several

commenters suggest that we amend the Schedule of Fees for FY 1994. They

contend that fees in the Schedule are too high, that the schedule

provides the wrong mechanism for assessing fees, and that additional

services should be included in the fee schedule.

7. In particular, Fireweed Communications Corp.\6\ (Fireweed)

argues that the regulatory fees impose an unfair and confiscatory

financial burden on broadcast stations in small markets, and impinge on

the constitutional right of freedom of speech of Fireweed and its

listeners. Fireweed contends that the financial burden imposed by the

regulatory fee would cause it to reduce its programming or even to

cease its operations. The Joint Commenters, consisting of several cable

television interests,\7\ argue that we have authority to modify the Fee

Schedule for FY 1994, to add classes of services that Congress did not

include in section 9(g)'s fee schedule. In addition, the Joint

Commenters assert that the Commission is authorized to modify the fee

schedule for FY 1994 because section 9(b)(3), which governs permissive

adjustments to the fee schedule, including addition of services to the

schedule, does not restrict our authority for making changes to fiscal

years after 1994. In particular, the Joint Commenters contend that

Direct Broadcast Satellite, if available later this fiscal year,

Instructional Television Fixed Service, if used for commercial

purposes, and Multi-channel Multipoint Distribution Services, because

it is not expressly enumerated as a service subject to the fee

requirement, should be added to the fee schedule and assessed a fee for

FY 1994. The Joint Commenters also assert that adopting a fee

requirement for these services in this proceeding will avoid the

necessity for immediately initiating a new rulemaking to include these

services in the fee schedule for FY 1995 and thereafter.

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\6\Fireweed filed its comments late. It argues that the

Commission failed to provide proper notice to interested parties and

asserts that we failed to publish the NPRM ``in publications likely

to be obtained by small entities'' or to ``conduct open conferences

and public meetings'' concerning our proposals as provided in 5

U.S.C. Sec. 609 (2) and (4). However, section 609 requires only that

we ``assure that small entities have been given an opportunity to

participate in the rulemaking'' through means ``such as'' those

enumerated in section 609. 5 U.S.C. Sec. 609. We have met that

requirement. The NPRM was published and distributed pursuant to

section 1.412 of our rules and was distributed to over 100 members

of the trade press, newspapers, wire services, broadcasters, and

magazines, including those dealing with consumer, minority and small

business issues. In addition, the Commission's Daily Digest, which

included notice of the NPRM, was published on Internet. We will also

accept and give full consideration to the arguments in Fireweed's

comments even though they were untimely filed. Further, we will

accept the late filed comments of MCI Telecommunications

Corporation.

\7\The Joint Commenters are Blade Communications, Inc.,

Cablevision Industries Corp., Crown Media, Inc., Multivision Cable

TV Corp., Parcable, Inc., Providence Journal Company, Sammons

Communications, Inc., and Star Cable Associates.

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8. Other parties including Sprint, the Cellular Telephone Industry

Association (CTIA), Comsat, and the Utilities Telecommunications

Counsel (UTC), support our conclusion in the NPRM that Congress

intended that the Schedule set forth in section 9(g) would govern the

assessment and collection of fees for FY 1994. UTC states that

Congress' inclusion in section 9(g) of the fee schedule, as well as

other language in the Act, clearly demonstrates that Congress did not

intend that the Commission revise the fee schedule so soon after its

enactment.

9. We are not persuaded by the arguments urging a reduction in the

statutory fees or amendment of the service categories subject to the

regulatory fees. In the NPRM, we concluded that Congress did not intend

that we change the amounts or the services established by the statutory

fee schedule for 1994. Our conclusion is supported by the Conference

Report, which states that we have authority to review and adjust the

fees after one year.\8\ Congress also enacted the fee schedule after

reviewing information that we provided concerning the services subject

to the fees. We do not believe that Congress would have enacted section

9(g) intending that we immediately amend the service classifications or

fee amounts in its schedule.

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\8\H.R. Rep. No. 213, 103 Cong., 1st Sess. 499 (1993)

(Conference Report).

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10. In addition, other provisions of section 9 support our

interpretation. Section 9(i) requires that, before making adjustments

to the services included in the fee schedule, we must develop

accounting systems and provide an opportunity for public comments on

proposed cost allocations. NPRM para. 9. Section 9(b)(4)(B) requires

that any amendment to the services contained in the statutory fee

schedule not be effective until 90 days after Congress is notified of

those revisions. See 47 U.S.C. 159. As a practical matter, the

Commission could not possibly meet these requirements in time to permit

section 9 fee collections in FY 1994. Given these statutory

requirements, we conclude that Congress did not intend that we make any

changes to the services subjected to the regulatory fee requirement or

the amounts contained in the schedule for FY94.\9\

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\9\In view of our conclusion that Congress did not intend us to

make any changes to its Schedule of Fees for FY 1994, we will not at

this time assess fees on lifetime restricted radiotelephone and

radio operator applicants and permittees.

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11. Also, we do not agree with Joint Commenters that this is the

appropriate proceeding to amend the Schedule of Fees for future years.

Such amendments would be premature because we do not now have the

information necessary to establish regulatory fees for FY 1995. As we

stated in the NPRM, we intend to commence a separate proceeding in

connection with the assessment of fees for FY 1995. We will seek in

that proceeding comment concerning the allocation of costs of our

enforcement, policy and rulemaking, information services, and

international services, including any necessary adjustments to the

classes of services set forth in section 9(g)'s fee schedule. See 47

U.S.C. 159(i).

12. Therefore, as we proposed in the NPRM, in order to meet the

congressional directive to implement the collection of regulatory fees

in Fiscal Year 1994, we are adopting without modification the Schedule

of Regulatory Fees enacted by Congress in section 9(g). See 47 U.S.C.

159(b)(1)(C). The Schedule provides a listing of the specific

categories of regulatees in the Private Radio, Mass Media, Common

Carrier and Cable services that are required to pay a regulatory fee.

We have incorporated the schedule into our rules and we have

established separate sections of the rules to provide the payment

schedules for the Private Radio Services (Sec. 1.1152), Mass Media

Services (Sec. 1.1153), Common Carrier Services (Sec. 1.1154) and Cable

Services (Sec. 1.1155). In Appendix A of this Report and Order, we have

included guidelines for the payment of fees for each service subject to

the regulatory fee requirement.

B. Exemptions From Regulatory Fees

13. In the NPRM, we proposed to exempt certain discrete categories

of regulatees from the requirement of file annual regulatory fees.

Section 9(h) explicitly provides and exemption from the fees for

governmental entities, nonprofit entities and amateur radio licensees.

47 U.S.C. 159(h). We concluded that Congress also intended to exempt

all public safety licensees and noncommercial educational broadcasters

from the regulatory fee requirements. In the paragraphs below, we

review each of these categories and consider the comments that address

each exemption.

1. Governmental Entities

14. As provided in section 9(h) and proposed in the NPRM,

governmental entities will exempt from the regulatory fee requirement.

As proposed, our rule implementing the governmental exemption will

conform to existing Sec. 1.1112(f) of the rules, which provides an

exemption for governmental entities from the fee requirements for

applications and other filing fees. See 47 CFR 1.1112(f); see also 47

U.S.C. 158(d)(1) (A), (B). Section 1.1112(f) broadly defines the term

``governmental entity'' to include ``any state, possession, city,

county, town, village, municipal corporation or similar political

organization or subpart controlled by publicly elected officials

exercising sovereign direction and control over their respective

communities or programs.'' The comments generally support our proposals

with regard to the exemption for governmental entities.

15. Cellular Communications of Puerto Rico (CCPR) contends that we

should limit the government exemption so that only usual and customary

governmental functions would be exempt. In particular, CCPR argues that

the Puerto Rico Telephone Company (PRTC) which is controlled by the

Commonwealth of Puerto Rico and operates a cellular telephone system,

should be required to pay a regulatory fee to the extent that it

engages in for profit or competitive operations. Further, CCPR argues

that exempting PRTC from the regulatory fees for cellular telephone

systems would give PRTC an unfair competitive advantage. In opposition,

PRTC argues that Congress did not distinguish between different

activities, and that as a result all of its operations are subject to

the governmental exemption.

16. The governmental exemption is mandated by Congress. Congress

did not distinguish between various governmental functions, nor did it

restrict the exemption's availability for any specific governmental

entities. Therefore, we do not accept CCPR's proposal.

2. Nonprofit Entities

17. Section 9(h) also exempts nonprofit entities from the

requirement to file regulatory fees. In the NPRM, we tentatively found

that Congress intended its exemption for nonprofit entities to cover

any entity possessing nonprofit, tax exempt status pursuant to section

501 of the Internal Revenue Code, 26 U.S.C. 501. Congress' exemption of

nonprofit entities from regulatory fees is substantially broader than

the limited exemption from the payment of application filing fees that

Congress afforded in section 8(d)(1) to nonprofit entities licensed in

the Public Safety Radio Services and tax exempt under section

501(c)(3). See 47 U.S.C. 158(d)(1); see also 47 CFR 1.1112(b). The

comments generally support our interpretation of the exemption, and we

will adopt the exemption as proposed in the NPRM. The nonprofit

exemption will be available only to those licensees who have

established their nonprofit status under section 501.

3. Amateur Licensees

18. Pursuant to section 9(h), we proposed to establish an exemption

from regulatory fees for amateur radio operators licensed under part 97

of our rules. However, Congress included in the Schedule of Fees an

annual regulatory fee covering vanity call signs, and we proposed to

establish a fee for amateur vanity call signs. We proposed that this

fee would be assessed if our proposed rules to establish vanity call

signs become effective. See Notice of Proposed Rulemaking, 9 FCC Rd 105

(1993).

19. We will adopt the exemption for amateur licensees as set forth

in NPRM. If our proposal to issue vanity calls signs is adopted, we

will also assess a regulatory fee in FY 1994 upon persons filing

applications, pursuant to the charges listed in Congress' fee

schedule.\10\

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\10\The American Radio Relay League, Incorporated asserts that

it has requested Congress to change the vanity call sign annual

regulatory fee to a one time application fee. We, of course, will

modify our fee schedule to be consistent with any congressional

amendment of the fees.

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4. Noncommercial Educational Broadcasters

20. In the NPRM, we concluded that regulatory fees are not

applicable to noncommercial educational broadcasters. Congress included

commercial television and AM and FM radio broadcast licensees and

permittees in its Schedule of Fees. In contrast, Congress omitted the

noncommercial educational stations from the category of stations

subject to the regulatory fee. In addition, and consistent with

existing section 1.1112(d) of the rules governing application fees, we

proposed to exempt from the regulatory fee requirement any secondary

and auxiliary broadcast services, such as low power television

(``LPTV'') stations, television translators and boosters, remote pickup

stations and intercity relay stations and other Mass Media, Common

Carrier, and Private Radio facility authorizations used with

noncommercial radio, television and instructional services qualifying

for the exemption. See 47 CFR 1.1112(d). The comments supported the

exemption for nonprofit educational broadcast stations and we will

adopt the exemption as set forth in the NPRM.

21. Further, we affirm the tentative conclusion of the NPRM that

noncommercial international short-wave will be subject to the

regulatory fees. Congress did not provide an express exemption for

these stations and none of the commenters urged us to exempt the

international short-wave stations. In addition, unlike noncommercial

LPTV and translator stations, the government does not provide financial

support to noncommercial international short wave stations through the

Corporation for Public Broadcasting (CPB) or the National

Telecommunications and Information Administration (NTIA). Thus, the

considerations that led us to conclude that Congress intended to exempt

noncommercial educational LPTV and translator stations are not present

with respect to international short-wave stations. See Fee Collection

Program, 6 FCC Rcd 5919, 5925 (1991).

5. Public Safety Services

22. We have received no comments opposing our proposal to exempt

all licensees in the Special Emergency Radio and Public Safety Radio

services from regulatory fees even where the licensee does not qualify

for an exemption as a governmental or nonprofit entity. In the NPRM, we

noted that the legislative history states that Congress intended to

exempt public safety licensees from regulatory fees. APCO, in

supporting our proposal, urges that we limit the public safety

exemption to entities eligible for Public Safety Radio Service licenses

pursuant to the provisions of part 90, subpart B, and not exempt

licensees merely because they are authorized to operate on a public

safety channel. We agree with APCO that only entities eligible to

operate as public safety licensees should be entitled to an exemption.

Therefore, we will restrict the public safety exemption to entities

eligible to operate in the Special Emergency Radio or Public Safety

Radio Services.\11\ Under this definition, the fact that a licensee is

authorized to use a frequency allocated to these services is

insufficient to gain an exemption as a public safety entity.

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\11\Moreover, we will not assess a regulatory fee upon Emergency

Broadcast Service (EBS) licenses for auxiliary service facilities

that use government-provided equipment because these stations are

dedicated for EBS and are used solely for public safety purposes.

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6. Certification of Exempt Status

23. In order to implement our congressional mandate concerning

exemptions, the NPRM asked the parties to comment on the appropriate

method for establishing exemptions from regulatory fees. Our goal is to

minimize the burden on applicants and licensees seeking exemption from

the regulatory fees. See NPRM at 13, 16, and 21. The commenters

supported our efforts and urged reporting and exemption certifications

designed to minimize their paperwork burdens.

24. Forest Industries Telecommunications (FIT) proposed that the

Commission allow nonprofit entities to establish their exempt status by

submitting a Determination Letter issued by the Internal Revenue

Service (IRS) stating that the applicant has qualified for tax exempt

status under Section 501 of the Internal Revenue Act. The Utilities

Telecommunications Council (UTC) urges that we reduce the burden on

entities seeking to obtain a nonprofit exemption by requiring only that

they file their employer identification numbers (EINs). UCC asserts

that EINs are sufficient to permit verification of an entity's

nonprofit status. The National Telephone Cooperative Association (NTCA)

urges that we also exempt entities that have applied for IRS

Determination Letters so that IRS administrative delays do not result

in the denial of exemption from the regulatory fee requirement. NTCA

requests that our determination of nonprofit status remain effective

until a change in such status is determined by the IRS.

25. PRTC urges us to rely upon existing exemptions from application

fee payments held by governmental entities rather than require these

entities to provide additional certifications to obtain exemptions from

the regulatory fee requirement. Similarly, UCC contends that no

additional certification of exempt status should be required from

governmental applicants in the Private Radio services since

applications for these services require information disclosing their

exempt status.

26. We agree with PRTC and UCC that we can rely on the data in

private radio service applications and in the Commission's files to

determine a regulatee's exempt status. Further, licensees and other

regulatees for whom we have such data will not be required to file

documentation to support their exempt status. If, after reviewing the

information already on file, we are unable to determine a regulatee's

exempt status we will issue a request that an applicant or licensee

further document its claim of exempt status. With respect to amateur,

noncommercial educational broadcast stations and public safety

licensees, we do not anticipate any problem in establishing their

eligibility for exempt status because their exempt status is based on

the nature of their licenses.

27. When our records contain no evidence of a governmental entity's

exempt status, we will accept a certification of its governmental

status. Nonprofit licensees may submit section 501 Determination

Letters. Because these documents are readily available in the files of

nonprofit entities, we decline at this time to establish a mechanism to

verify nonprofit status through EINs. We will also require that an

entity with a pending request for an IRS Determination Letter submit a

regulatory fee because the IRS may deny the request for tax exempt

status. However, we will refund the fee for the period covered by a

subsequently issued Determination Letter.\12\

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\12\To obtain a refund a regulatee must demonstrate that the

period covered by the Determination Letter's finding of tax exempt

status includes the date that we established for the calculation of

its fee in the fiscal year for which the refund is requested.

Further, an entity will be subject to a regulatory fee for the

fiscal year that the IRS terminates its tax exempt status if the

termination is made prior to the date for calculating its fees.

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28. We caution that we expect regulatees to act in good faith. In

any instance in which payment is overdue, and the licensee or permittee

cannot establish its entitlement to an exemption, we will assess a 25

percent penalty for late payment as authorized by Congress.

C. Waivers, Reductions and Deferments

29. Section 9(d) provides that ``[t]he Commission may waive,

reduce, or defer payment of a fee in any specific instance for good

cause shown, where such action would promote the public interest.'' 47

U.S.C. 159(d). Section 9(d) is similar to, if not identical with

section 8(d)(2) of the Act related to waivers and deferments of

application fees. 47 U.S.C. 158(d)(2). Pursuant to section 8(d)(2), we

have permitted waivers only on a case-by-case basis following a

demonstration that the public interest clearly overrides the private

interest of the requester. Thus, in our NPRM, we proposed to restrict

similarly waivers to encompass only those requests unambiguously

articulating ``extraordinary and compelling circumstances'' outweighing

the public interest in recouping the cost of the Commission's

regulatory services from a particular regulatee.

30. For those entities required to file regulatory fees with their

applications, such as licensees in the private radio service, we

proposed procedures for filing waiver, deferral and reduction requests

similar to those we have fashioned for application fee waiver requests.

See 47 CFR 1.1115(e). Persons seeking waiver or reduction of a

regulatory fee would submit the required fees and forms along with

their requests for waiver or reduction. We noted that this procedure

assures efficient collection of necessary fees and avoids the possible

imposition of a late fee in the event that the licensee's request for

waiver or reduction is denied. In the case of standard regulatory fees,

we further proposed that the required fee accompany any request for

waiver or reduction. In either case, we proposed to return or modify

the tendered fee upon grant of the waiver or reduction request.

Finally, we proposed that a request for deferred payment of the

required fee should be submitted 60 days in advance of the date

established for the payment of the fee in order to permit review and

action prior to the fee's due date.

31. Several state broadcasting associations (State Broadcasters) in

their joint comments, suggest that the public interest would be served

by granting permanent or temporary waivers or reduction or deferment of

fees to Mass Media licensees who can demonstrate that payment of the

fees would impair their service to the public. The State Broadcasters

contend that our authority to waive, reduce or defer fee payments in

such cases is clear if a showing is made that payment of the fee would

result in degradation of service to the public, citing NBC v. United

States, 319 U.S. 190 (1943); FCC v. Sanders Bros. Radio Station, 309

U.S. 470 (1940). In order to demonstrate financial hardship, the State

Broadcasters urge that they be allowed to submit any relevant evidence,

including tax records, unaudited balance sheets or any other financial

statements. Further, the State Broadcasters argue that the fee should

be automatically waived if a Mass Media licensee is in bankruptcy,

receivership or trusteeship because this status is a clear signal of

financial hardship.

32. The Broadcasters, joined by the National Association of

Broadcasters (NAB), contend further that the requirement to file the

regulatory fee payment with a request for waiver is irrational where

the basis for the waiver request is the financial hardship of the

licensee. Further, the NAB states that it will be impossible to dispose

of waiver requests before the fee payments are due for FY 1994 because

of the short period between the completion of this proceeding and the

date for submission of fees. Moreover, the NAB stresses that Congress

contemplated that there would be situations where the financial burden

imposed by the fee requirement would be so onerous that payment should

be waived. According to the NAB, if Congress' purpose in providing for

waiver, reduction or deferment is to have any practical effect,

according to NAB, we should not require applicants requesting waivers

for financial hardship to suffer additional financial burden that they

cannot afford.

33. We are not persuaded that we should modify our proposal to

generally require the filing of the regulatory fee with each waiver or

reduction request. Rather, we continue to believe that our current

procedure will help ensure efficient collections.

34. Nevertheless, we recognize that there may be exceptional

instances in which requiring payment of the regulatory fee along with a

waiver or reduction request could result in the reduction of service to

a community or other financial hardship to the licensee or other

regulatee. In those instances, the licensee should submit, together

with its waiver request, a petition to defer payment until the waiver

request is resolved. In order to reduce the burden on regulatees, we

will accept petitions for waiver, reduction and deferment so long as

they are filed no later than by the date payment is due. The filing of

the deferment request will toll the requirement to pay the regulatory

fee until disposition of the deferment request.\13\

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\13\We deny NABER's request that we modify the fee that Congress

required for filing a petition for waiver of a private radio service

rule. Section 8 of the Communications Act empowers us only to adjust

fees for applications and other filings based upon changes in the

Consumer Price Index.

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35. Petitioners seeking a waiver, deferral or reduction of a

regulatory fee based upon financial hardship may submit any relevant

information in support of their request. We will review the supporting

documents and base our ruling upon the information submitted and any

additional information available in our records. If a petitioner

presents a compelling case of financial hardship, no payment of the

regulatory fee will be due. If the supporting materials do not present

sufficient evidence of hardship, we will deny the petition. If the fee

has not already been submitted, the petitioner will then have 30 days

to file its regulatory fee in order to avoid the assessment of penalty

charges and the invocation of any other available remedy. The filing of

a petition for reconsideration will not toll this 30-day period.

D. Procedures for Payment

1. Categories of Payors

36. Pursuant to section 9(f), we proposed to establish three

classes of regulatory fee payments, standard, small and large, based

upon the size of the payment required by the Schedule. The time for

submitting the fee would be determined by the class of fee payment.

Persons making ``large'' fee payments for Fiscal Year 1994 would be

eligible to complete their fee payment in two installments. Moreover,

we stated that consideration would be given to allowing four

installment payments for Fiscal Year 1995 and thereafter. We proposed,

however, that small fee payments be remitted when an application for a

license of a facility subject to the fee is filed and the payment

amount is the fee due for the entire term of the license or other

authorization. We proposed that regulatees subject to a standard fee

are to submit the fee in a single, annual payment. The specific date

for the payment of a standard fee would be announced by public notice

and published in the Federal Register well before the payment's due

date.\14\

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\14\GTE has urged that we allow licensees that transfer or

assign licenses during FY 1994 to pro-rate their fee payments for

the subject licenses on the basis of the amount of time the license

was held by each party. The law authorizing section 9 was enacted in

August 1993 and we believe that the negotiation between the parties

to a transfer or assignment that occurred this fiscal year would

ordinarily have included consideration of expenses related to the

payment of regulatory fees. The party holding the license on the

date the fees are due will be the party responsible for its payment.

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37. Brown and Schwaninger (B&S) states that Congress intended to

establish only two, not three, categories of regulatory fees--large

fees and small fees--because section 9(f) enumerates only two such

categories of fee payments. B&S contends that Congress would have

included in section 9 explicit authority to establish a third category

if it had intended to provide such authority. In the absence of any

language in section 9 indicative of a third category, B&S contend that

we are precluded from adopting a standard fee category and collecting

standard fees. Instead, B&S reasons that our authority under section 9

is limited to determining that a particular fee is either large, and

establishing an installment plan, or the fee is small and collecting it

in advance for a number of years not to exceed the term of the license.

38. We reject B&S's interpretation of section 9(f). In section

9(a), the general authority provision, Congress broadly empowered us

``to assess and collect regulatory fees. . . .'' Subsection 9(f)

requires only that our rules include specific provisions providing for

advance payments in the case of small fees and installment payments for

larger ones. Nothing in that section, or in logic, compels a conclusion

that every fee must necessarily fall within a category of either

``large'' or ``small.'' Section 9(f) is simply silent regarding any

other substantive aspect of our fee collection system, including

whether other categories of fee payments may be established. Moreover,

our conclusion that some regulatees are subject to payment of neither

large nor small fees and, consequently, are only subject to a single

annual regulatory ``standard'' fee payment, in no way conflicts with

Congress' directive to include specific consideration of those payors

of large and small fees. Therefore, we adopt our proposal to establish

three categories of regulatory fees.

2. Installment Payments

39. In the NPRM, we proposed that some fees would be classified as

``large'' fees and, therefore, eligible for payment by installment. For

FY 1994, we identified the following fee amounts in the specified

categories as eligible for payment on the installment plan.

------------------------------------------------------------------------

Regulatory fee category Large fee

------------------------------------------------------------------------

VHF and UHF Commercial Television Station........ Above $12,000.

Cable Television System.......................... Above $18,500.

Inter-Exchange Carrier........................... Above $500,000.

Local Exchange Carrier........................... Above $700,000.

------------------------------------------------------------------------

40. Several parties urge that we expand significantly our proposed

installment payment eligibility standards. GTE and Sprint request that

we establish an installment fee benchmark of $250,000 for all classes

of services that are not allowed to make installment payments under our

proposal. The Broadcasting Association argues that all mass media

licensees should be eligible for installment payments and the New

Jersey Broadcasting Association (New Jersey Association) argues that

all radio broadcasting licensees, or in the alternative, licensees

encountering financial hardship should be permitted to make installment

payments. GE American Communications, Inc. contends that licensees of

satellite space stations should be afforded installment payment

eligibility.

41. For FY 1994, we intend to permit installment payments by a

reasonable number of regulatees whose fees greatly exceed the average

fee in a particular service category. Through this means we can ensure

that we are able to structure a fee collection system that can be

fairly and efficiently administered, given our available resources and

our relative inexperience with the regulatory fee program and its

installment component.\15\

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\15\Because our fee collection program is not yet capable of

accounting for installment payments aggregated on other than a

single service basis, regulatees must pay their fee payments on a

service by service basis.

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42. Since little time is left in which to collect fees for FY 1994,

the practical impact of permitting licensees to make installment

payments this year should be minimal in any event. In these

circumstances, we thus find it both fair and prudent to decline to

expand significantly installment payment eligibility for FY 1994. Also,

we decline to permit installment payments for radio licensees, since no

fee greater than $900.00 is imposed on these licensees.

43. As we gain experience with the regulatory fee program and, in

particular, with its installment payment component, we will consider

increasing eligibility to make installment payments. Therefore, with a

limited exception, we will adopt our proposed installment fee

standards. As discussed above, if a licensee concludes that payment of

a fee in its entirety would constitute a financial hardship or if it

cannot otherwise submit a full payment, the licensee may submit a

partial payment of the fee with a petition to defer payment of the

remaining portion of the fee. Interested parties may renew their

arguments for increased installment opportunities in their comments

concerning the assessment and collection of regulatory fees for 1995.

44. Notwithstanding our decision not to expand significantly

installment payment eligibility this year, we have decided to permit

space station and system licensees to submit their fees in

installments. These licensees are relatively few in number, and the

uniform fee structure for this service does not lend itself to the

mechanism we used to establish installment payments in categories of

services with progressive fee structures. Thus, we will permit

licensees of geosynchronous satellite space stations and low earth

orbit satellite systems to file their fee payments in installments.

45. As proposed, regulatees qualifying for installment payments for

FY 1994 may make their fee payments in two separate and equally divided

payments with the first payment due on the date set for paying standard

annual fees. The date for each installment will be announced by Public

Notice and in the Federal Register. For future fiscal years, we plan to

permit four installments annually. We have decided not to impose an

administrative fee with each installment payment. However, any late

filed installment payment will be subject to a 25 percent late fee and

the payment of interest for the delinquent amount. Further, any

regulatee paying its fees by installment will automatically lose its

eligibility to pay by installments if it fails to make any of its

payments in a timely fashion.

3. Advance Payments

46. FIT and UTC support our proposal to require that regulatory fee

payments in the Private Radio services be made in advance. We will

require that full payment for Private Radio service regulatory fees due

over the entire term of the authorization be submitted at the time an

applicant in the Private Radio service submits its new, renewal or

reinstatement application.\16\ For example, regulatees in the private,

shared use services would submit a one time regulatory fee of $35.00

per license to cover the entire five-year term of their license or

authorization. Moreover until expiration of that authorization, we will

not subject regulatees submitting advance fee payments to submit

another (supplementary) fee payment for the same authorization until

expiration of that authorization, notwithstanding any subsequent

increase in the applicable annual fee. In instances in which a license

is transferred to another service and, therefore, becomes subject to a

different annual fee, as in the case of Private Radio licensees as they

become Commercial Mobile Radio Service licensees, we have generally

decided to apply any advance payment to the new annual fee requirement

resulting from that reclassification. Thus, the licensee would become

subject to payment of the difference between its initial fee payment

and the amount required under the fee schedule for its new service.

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\16\Regulatory fee payments submitted with applications that are

subsequently dismissed or denied will be returned upon request.

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47. For FY 1994, no Mass Media or Common Carrier regulatory fees

will be subject to collection as small fees. However, in future years,

we may decide to collect advance payments of fees in these services in

the event that we conclude that the fee required is small and our

experience shows that it is inefficient to collect the fee on an annual

basis.

4. Timing of Payment

48. As noted, the date for payment of standard fees will be

announced by public notice and published in the Federal Register. For

licensees, permittees and holders of other authorizations in the Common

Carrier, Mass Media and Cable Services whose fees are not based on a

subscriber, line or circuit count, fees should be submitted for any

authorization held as of October 1, 1993. We have selected October 1 as

the date for calculating these fees since October 1 is the first day of

the fiscal year and, therefore, current licensees subject to the fees

would have benefited from out regulatory activities since the beginning

of the period covered by their payment.\17\

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\17\In light of this decision, the comments by Orbital

Communications Corporation, GE American Communications, Inc. and

Starsys Global Positioning, Inc. concerning appropriate payments for

satellites that became operational after commencement of the fiscal

year are moot.

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49. In the case of regulatees whose fee payments are based upon a

subscriber, line or circuit count, we have decided that the number of a

regulatee's subscribers, lines or circuits on December 31, 1993 will be

used to calculate the fee. We have selected the last date of the

calendar year because many of these entities file reports with us as of

that date. Others calculate their subscriber numbers as of the last day

of the calendar year for internal purposes. Therefore, calculation of

the subscriber fee as of that date will facilitate both an entity's

computation of its fee payment and our verification that the correct

fee payment has been submitted. Cable systems should calculate their FY

1994 regulatory fees using the subscriber data that was provided to the

Commission for the 1993 Annual Report of Cable Television Systems (FCC

Form 325A) submission. Accordingly, the number of subscribers will not

necessarily be based on December 31, 1993, but rather on ``a typical

day in the last full week of December 1993.'' (See FCC Form 325

Instructions at page 1). Finally, since entities in the Private Radio

services pay their fees when applying for an new, renewal or

reinstatement license, we will require Private Radio applicants to

submit a regulatory fee with new, renewal and reinstatement

applications filed following the effective date of these rules.

5. Method and Location of Payment

50. We proposed to adopt generally the same methods of payment for

regulatory fees as we established for application fees. See 47 CFR

1.1108(a). In addition, we proposed to establish a process to permit

the electronic filing of fee payments, initially on an experimental

basis. Further, we proposed to permit payment of fees by credit card

(VISA and Mastercard) in some circumstances subject to the requirement

that, when a credit card payment is made, the entire fee payment must

be made in a single credit card transaction.

51. Several parties have requested clarification of our

requirements for multiple fee payments by Private Radio licensees.\18\

Other parties support our proposals concerning payment methods,

particularly our decision to accept credit cards and electronic

payments.\19\

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\18\See comments filed by FIT, Naber and UTC.

\19\See comments filed by SWB and Bell Atlantic.

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52. We have designed FCC Forms 159 (Remittance Advice) and 159-C

(Continuation sheet) to replace Form 155. We are satisfied that the

forms, and our rules, provide sufficient clarification of our

requirements concerning multiple fee payments. These forms are to be

submitted with any regulatory fee payment in the mass media, common

carrier and cable services. Payors, in the Private Radio services

making a single regulatory fee payment, other than by electronic means

or credit card, are not required to file a Form 159 as long as their

accompanying application form provides the information necessary to

accomplish the payment.

6. Multiple Payments

53. Generally, we will permit any entity, including licensees in

the private radio services, to make multiple section 9 regulatory (and

section 8 application) fee payments within the same lockbox, including,

where applicable, installment payments. Under this procedure, a single

payment form and a single instrument of payment may be used to cover

multiple regulatory fee payments.\20\ A multiple regulatory fee payment

also may cover payments by more than a single regulatee. Regulatees

making combined payments of regulatory fees and application fees within

the same lockbox for the Private Radio services may make payment with a

single payment instrument and are to submit with the multiple payment a

Form 159 and, if needed, a Form 159-C. Also, any regulatee making

payment by credit card, including licensees in the private radio

services, must submit a Form 159. See the specific instructions

concerning the use of Forms 159 and 159-C. A copy of the forms and

instructions may be obtained from the Federal Communications

Commission, Forms Distribution Center, 2803 52d Avenue, Hyattsville, MD

20781.

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\20\Payors of regulatory fees for vanity call signs must submit

a Form 159 with their applications.

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54. Each regulatee will remain solely responsible for assuring that

its applications and authorizations are properly accounted for and

listed, and for submitting the full, cumulative payment covering each

of its licenses and authorizations.\21\ As described below, payment

deficiencies could lead to penalty charges, dismissal of applications

and revocation of authorizations.

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\21\Payment of a regulatory fee may be made by a third party, as

NABER and NECA request. However, the entity subject to the

requirement to pay the fee will remain responsible for ensuring

correct and timely payment.

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55. As proposed in our NPRM, we are establishing a single lockbox

at our lockbox bank for the receipt of mass media, common carrier and

cable regulatory fees. The single lockbox will accept Mass Media,

Common Carrier and Cable Services regulatory fee payments, and will

enable regulatees to submit fee payments for these services to the same

lockbox and to combine their fee payments for these service categories.

However, Private Radio fees will not be accepted at this lockbox and,

instead, should be submitted to the lockbox designated for application

fees covering the category of license or authorization for which the

payment is made. See sections 1.1152 through 1.1155 for the address,

including lockbox number regarding payment of regulatory fees for the

specific categories of service.

7. Electronic Payments

56. We have decided to proceed cautiously with our implementation

of electronic fee payments. We require that regulatees intending to

make fee payments electronically submit a written request to the

Managing Director and obtain his written authorization or that of his

designee prior to making their initial electronic payment.\22\

Following authorization by the Office of the Managing Director, a payor

may either instruct its bank to make payment of a regulatory fee

directly to our lockbox bank or authorize us to direct our lockbox bank

to withdraw funds directly from the payor's bank account. It is the

responsibility of the entity subject to the regulatory fee payment to

assure compliance with our electronic payment procedures. We will

announce specific procedures for electronic payment by public notice.

Failure to comply with these procedures will result in the return of

the fee payment and a penalty of 25 percent if the subsequent refiling

of the payment is late. Any late payment resulting from a failure to

comply with our electronic fee payment procedures will also subject the

payor to the penalties set forth in Sec. 1.1163 of the rules.

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\22\NYNEX has suggested that responsibility for recommending

rules and procedures relating to the electronic payment of

regulatory fees by common carriers be given to the proposed advisory

committee that would be established to assist the Common Carrier

Bureau in the development and implementation of an electronic filing

system. See Public Notice, 9 FCC Rcd 1293 (1994). Since our system

for the electronic payment of fees will soon be operational, we

decline to combine these tasks into a single project. However, the

Commission staff involved in these undertakings will closely

coordinate their activities.

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57. Credit card payments may be made only with Mastercard and Visa

since at this time these are the only credit cards authorized for

payments to the United States Treasury. Credit card payments must be

accompanied by a Form 159. Failure to accurately enter an authorized

signature and the credit card name, number and date of expiration in

blocks 22 and 23 of Form 159 will result in the return of the credit

card payment and any associated filing.

E. Enforcement

58. As provided in section 9(c) of the Act, we proposed to enforce

payment of regulatory fees by: (1) Assessing monetary penalties for

late payment, (2) dismissal of applications and, (3) in egregious

cases, revocation of existing licenses and authorizations. 47 U.S.C.

159(c). In addition, we proposed to pursue delinquent regulatees under

the Debt Collection Act, 31 U.S.C. 3711 et seq., and related statutory

provisions.

1. Penalties for Late Payment

59. Any regulatee that fails timely to pay its regulatory fee or

make an installment payment shall be assessed a 25 percent penalty. See

47 U.S.C. 159(c)(1). A regulatory fee is untimely paid when it is not

received at the lockbox bank by the date we establish for payment.\23\

A fee payment is also considered late filed if an instrument of payment

is not collectible. A 25 percent penalty will be assessed against any

outstanding amount due on a fee, including any amount past due on an

installment payment.

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\23\The NAB and the Society of Broadcast Engineers have proposed

that we consider a regulatory fee payment to be timely submitted if

the payment is postmarked by the date it is due. At least for FY

1994, we have decided to continue our practice of requiring fee

submissions to be received by the date due. We believe retention of

this practice for regulatory fee payments for FY 1994 is necessary

to enable us to process these payments efficiently.

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2. Dismissal of Application

60. We will dismiss any application, group of applications or other

filings in the private radio services when a regulatee fails timely to

submit any regulatory fee or associated penalty. 47 U.S.C. 159(c)(2). A

fee payment will be considered to be late filed if a timely filed

instrument of payment is uncollectible and the deficiency is not the

result of bank error.\24\ Thus, an application required to be submitted

with a regulatory fee will be returned without action if the fee is not

filed with the application. Moreover, if the returned application is

mutually exclusive and must be filed by a date certain (or is required

to be filed by a date certain for any other reason), the application

will be dismissed as untimely if resubmitted subsequent to the filing

deadline.\25\

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\24\As noted in the NNPRM, we will not accept instruments of

payment other than cashier's checks for payors who are notified that

payment will not be accepted by other payment methods. Of course,

while we discourage the use of cash for the payment of fees

generally, payment by cash is permissible. See 31 U.S.C. 5193. We

will not be responsible for cash lost or stolen in the process of

delivery to our lockbox bank.

\25\In any case in which a fee payor believes that a monetary or

other penalty has been wrongfully imposed, the fee payor may file a

petition requesting that the penalty be set aside.

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3. Revocation

61. Section 9(c)(3) provides the Commission with authority to

revoke an existing license or other authorization for nonpayment of a

regulatory fee. 47 U.S.C. 159(c)(3). We proposed to reserve our

revocation remedy for egregious cases of nonpayment. Section (9)(c)(3)

does not require a finding of ``willful or repeated'' failure to make

payment before a license or authorization may be revoked. Further, the

section affords the right to a hearing only if a regulatee's response

to our notice of revocation presents a ``substantial and material

question of fact.''

62. Consistent with the statutory framework for revocation, any

revocation hearing will be resolved by written evidence only and the

burden of proceeding and the burden of proof will be on the respondent.

As proposed, we will provide a period of 60 days for a regulatee to

respond to our notice of revocation in order to assure that the subject

regulatee will have a full opportunity to obtain the funds needed to

make payment and to prepare its case. Further, we will assess the

regulatee for the costs for the conduct of any revocation proceeding

unless the regulatee ``substantially'' prevails at the hearing. 47

U.S.C. 159(c)(3). Finally, pursuant to section 9(c)(3), an order of

revocation will not become final until the respondent regulatee has had

an opportunity to exhaust its rights to judicial review under section

402(b)(5) of the Act. 47 U.S.C. 402(b)(5).

63. MCI recognizes that we should use our authority to revoke

licenses and assess penalties as tools to enforce payment of fees.

However, MCI urges that we restrict their use to cases where a licensee

``willfully'' has acted in bad faith in not paying the required fee.

MCI states that this is particularly important for licensees with large

and complex operations in services where licensing information

currently is not included in our records since licensees with numerous

authorizations may have no other way to confirm existing licenses. In

these instances, according to MCI, we should attempt to resolve

nonpayment issues informally since most fee payment disputes should be

quickly and easily resolved.

64. We agree with MCI that our revocation powers should not be

lightly invoked. We stated in the NPRM that we would reserve the right

to revoke licenses held by a delinquent regulatee, but that we did not

foresee the need for revocation, except in egregious circumstances. We

will not consider a failed payment to be egregious as long as the

regulatee demonstrates that its deficiency was not due to gross neglect

in maintaining its records or in preparing to meet its obligation to

make the fee payments. However, we intend to automatically assess

delinquent payors a 25 percent penalty for late or missing payments,

and such assessments will be strictly enforced.

4. Debt Collection Act Remedies

65. In addition to those specific remedies for nonpayment or

untimely payment of regulatory fees provided in section 9, we will

invoke our powers under the Debt Collection Act against any regulatee

failing to pay a regulatory fee. See 31 U.S.C. 3711 et seq. We will

afford a regulatee a 30-day period to respond to our notice of

delinquency before invoking the procedures provided in the Debt

Collection Act. Moreover, when necessary, we will refer outstanding

debts of delinquent regulatees to the Internal Revenue Service for

offset. See 31 U.S.C. 3720A. Included in the recovery of any delinquent

fee will be an assessment of interest on the debt due, a penalty for

nonpayment, and the allowable cost incurred due to the federal

government in the collection process. See 31 U.S.C. 3717.

IV. Regulatory Fee Categories

66. In our NPRM, we provided an explanation of the regulatory fee

categories subject to the payment of a fee under the schedule

established by Congress. 47 U.S.C. 159(g). Where a regulatory fee

category required additional interpretation or clarification, we relied

on the legislative history of section 9 and our experience in

establishing and regulating the various services. The categories and

amounts set out in the schedule may, by the next fiscal year and in

subsequent fiscal years, be amended, adjusted, or modified to reflect

changes in our appropriations, costs and changes in the nature of our

regulated services. See 447 U.S.C. 159(b) (2), (3).

67. Several parties have submitted comments regarding the

regulatory fee categories. Generally, the comments addressed issues

concerning possible adjustment of the required fees, the absence of

certain services from the fee schedule, and definitions of terms

important to payment of the fees. We address these comments below. In

certain instances, we have clarified our explanation of a fee category

based upon the comments of the parties. See Appendix B.

A. Private Radio Services

68. The two basic levels of statutory fees allocated for Private

Radio Services, exclusive use and shared use services, were established

on the premise that those licensees who generally receive a higher

quality communications channel, due to exclusive or lightly shared

frequency assignments, will pay a higher fee than those who share

channels of marginal quality.\26\ House Report at 17. In addition,

because of the relatively small fee amounts levied in the Private Radio

Services, as we proposed in the Notice, applicants for new licenses,

reinstatement and renewal licenses will be required to pay a regulatory

fee covering an entire license term. Applications for modification or

assignment of an existing authorization do not require payment of a

regulatory fee since the expiration date of modified or assigned

licenses will not reflect a new license term.

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\26\As noted, for FY 1994, we will not impose a regulatory fee

upon applicants for lifetime restricted radiotelephone permits and

radio operator licenses.

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1. Exclusive Use

69. B&S disputes our interpretation of the fee schedule's

requirement for Private Radio Service fees. Essentially, B&S contends

that the term ``shared use services,'' as it appears in the Schedule of

Regulatory Fees, applies to systems that share use of their licensed

facilities with others. According to B&S, an 800 MHz Specialized Mobile

Radio Service licensee providing service to end users is an example of

a shared use service because the SMRs customers are sharing the same

base station facility. B&S argues that their analysis is consistent

with 47 CFR 90.179 and precedent interpreting that provision of our

rules. According to B&S, it follows that ``exclusive use services'' are

comprised of licensed facilities that are used only by the licensee. An

example of what B&S considers an exclusive use service is a licensee in

the Taxicab Radio service that operates an internal communications

system in the 470-512 MHz band.

70. B&S confuses the concept of shared use of a particular licensed

facility with that of shared channel assignments. Under 47 CFR 90.179,

a licensee or group of licensees may choose to share base station

facilities on a non-profit or not-for-profit basis. In contrast, shared

channel assignments require licensees to be licensed for the same

channel for the same geographic area, and it is this latter concept

that the Schedule of regulatory fees clearly addresses. As we have

recently explained in our Notice of Proposed Rulemaking in PR Docket

No. 92-235,\27\ the private land mobile radio services licensed below

470 MHz\28\ do not enjoy exclusive use of their channel assignments in

a particular geographic area, and must accept a greater degree of co-

channel interference.\29\ In contrast, channel assignments above 470

MHz, including the SMR service, are granted on either an exclusive

basis, with no other co-channel use authorized in a geographic area, or

are licensed on an ``earned exclusivity'' basis, where co-channel use

is capped. Thus, licensees of services above 470 MHz enjoy a lesser

degree of interference than those below 470 MHz, and, accordingly, are

required to pay the higher regulatory fee. To accept B&S's

interpretation would ignore the established demarcation point between

``shared'' and ``exclusive'' channel assignments that 470 MHz

represents.

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\27\8 FCC Rcd 8105, paras 11-13 (1992).

\28\The 220-222 MHz band is the sole exception, where we have

created exclusive use channels below 470 MHz.

\29\While there may be rare instances where a particular

licensee below 470 MHz does not share its channel assignment with

other licensees in a geographic area, these licensees have no

ability to preclude new licensees from requesting the same channel

assignment.

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71. RAM Mobile Data USA Limited Partnership (RMD) states that 900

MHz SMR licensees should be required to pay a fee based upon their

total number of licensed Designated Filing Areas (DFA) rather than

their number of base station and frequencies individually licensed with

a DFA. RMD contends that an assessment based upon total DFAs licensed

is more consistent with Congress' intention that regulatory fees be

``reasonably related to the benefits provided to the payor of the fee

by the Commission's activities.'' 47 U.S.C. 159(b)(1)(A). Further, RMD

states that section 9(g)'s fee requirements will compel a consolidation

of its licenses in order to minimize its fee payments. Similarly, the

Utilities Telecommunications Council (UTC) objects to the requirement

that 220 MHz licensees submit fees on a per license basis.

72. We decline to consider amending the section 9(g) fee schedule

for FY 1994. As we have stated, Congress did not intend that we adjust

any aspect of the fee schedule for FY 1994. RMD and UTC may submit

their proposals for amending the fee schedule in our proceeding to

establish regulatory fees for FY 1995.\30\

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\30\RMD asks that we waive our requirement that SMR licensees

pay their fees in advance and, instead, permit them to submit these

fees on an annual basis. RMD contends that the overall fees that may

be imposed on SMR systems are not ``small'' and, therefore, fall

outside the category of fees that Congress authorized us to collect

in advance. We decline to allow RMD to pay its fees on an annual

basis because Congress specifically indicated that fees for private

radio services licensees, including licensees of SMR systems, would

be considered small and subject to the payment of fees in advance.

See H.R. Rep. No. 207, 102d Cong., 1st Sess. 11 (1991).

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Of course, RMD and any other licensee may surrender or modify their

licenses and other authorizations in order to minimize their regulatory

fee burden.

2. Marine (Coast and Ship Stations)

73. Numerous formal and informal commenters, including the United

States Coast Guard, raise concerns about our proposal to collect a

regulatory fee from licensees in the marine service, including

licensees using radio equipment voluntarily installed on small vessels,

such as recreational boats.\31\ These parties contend that a waiver, or

exemption, for vessels that voluntarily carry radio equipment would

enhance maritime safety and promote the public interest. As support,

the parties state that marine radio provides a vital link between

recreational boaters and emergency safety entities, as well as an

important source for weather and navigational information. Further,

they contend that the regulatory fee, added to the existing application

fee, will act as a substantial disincentive for recreational boaters to

carry, maintain and operate marine communications equipment.

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\31\In addition to the USCG, the commenters include the National

Marine Electronics Association, Radio Technical Commission for

Maritime Services, State of Nevada, Division of Wildlife and the

United States Power Squadrons. We also received and considered

informal comments filed by numerous parties concerned about the

regulatory fee required from recreational boaters.

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74. We recognize that radio communication between recreational

boaters and various emergency safety entities provides an important

public service. However, our authority to waive a fee requirement is

limited to ``narrow'' and ``compelling circumstances.'' 2 FCC Rcd 947,

961 (1987); H.R. 3128, H.R. Rep. No. 453, 99th Cong., 1st Sess. 39-42,

423 (1985). In view of this strict Congressional limitation, we do not

believe that a ``blanket waiver'' granted to boaters operating marine

radios is permissible, absent legislative amendment.

3. General Mobile Radio Service

75. The Personal Radio Steering Group (PRSG) requests that we lower

the annual fee for licensees in the General Mobile Radio Service

(GMRS). PRSG states that, because the Schedule of Regulatory Fees does

not explicitly include a fee for GMRS, we have authority to reduce its

fee. Moreover, PRSG contends that the service should be subject to a

lower fee than that for other shared use services because it is

intended primarily for personal communications, similar to the Amateur

Radio Service.

76. We agree with PRSG that section 9(g)'s fee schedule contains no

explicit terms regarding the GMRS. However, that section does require

the payment of a fee by ``shared use'' services in the private radio

service. GMRS is within that category of service and was explicitly

mentioned in the House Report as a service that would be subject to a

fee. Therefore, we conclude that GMRS licensees are subject to a $7.00

fee for each year of the license term, payable in advance upon the

filing of a GMRS application. We decline to rule on the merits of

PRSG's argument that its fees should be lowered because, as discussed

above, we conclude that Congress for FY 1994 intended us to assess fees

in accordance with its Schedule.

B. Mass Media Services

1. Broadcast Stations

77. The regulatory fees in the Schedule for Mass Media services

generally include broadcast licensees, permittees and other regulatees.

As discussed above, we have exempted noncommercial educational

broadcasters from regulatory fees. To the extent possible, we intend to

use the Bureau's computer data bases to verify the identity of

regulatees subject to regulatory fees in the Mass Media services.

78. Several commenters contend that the statutory fee schedule is

unfair to certain categories of licensees in the Mass Media services

and complain that the schedule fails to impose a fee on other

categories of regulatees. De La Hunt Broadcasting Corporation and the

Broadcasting Associations believe that radio broadcaster licensees

should be assessed regulatory fees on a market-size basis, in a manner

similar to the fees mandated for television stations. The NAB urges

that we adjust the schedule for radio broadcast licensees when we

consider appropriate fees for future years. Further, the Broadcasting

Associations contends that we should not include a television station

as being in a major market unless that station serves the metropolitan

area of that particular market.

79. We decline to consider any adjustments to the schedule for FY

1994 for radio and television stations. As we explained above, we

believe that Congress did not intend that we adjust any aspect of the

fee schedule it established for FY 1994. Interested parties may submit

comments, however, addressed to modifying the method for assessment of

radio and television broadcasting fees at the time we issue our

proposed schedule of fees for FY 1995.

2. Television Stations

80. Section (9)(g) provides that the regulatory fee charged a

television licensee will be determined by the size of its market. We

recognized in our NPRM that Arbitron no longer provides television

rating information. However, no party has proposed that we rely on

another mechanism for determining market size. Therefore, we will

utilize Arbitron's ADI rankings for 1993-1994 for the determination of

television markets for assessing our FY 1994 regulatory fees since it

appears, at this time, that these are the most familiar and readily

available tools for determining the relative ranking of television

markets.

81. KBS License L.P. (KBS) and the NAB argue that satellite

television stations should not be subject to the same regulatory fee

payment as fully powered television stations. The NAB contends that

satellite television stations should be assessed as if they were

television translator stations. KBS argues that our proposal to assess

fees for satellite stations at the same level as full powered stations

is inconsistent with section 9. First, in KBS's view, Congress

established regulatory fees for commercial television stations, and did

not set any fee requirement for satellite television stations. Second,

according to KBS, Congress intended the Commission to charge licensees

fees based on the regulatory burden they impose, yet satellite stations

require much less regulatory oversight than full powered stations.

Also, KBS contends that the fee would place an unfair and illogical

burden on small market licensees who use satellite television stations

to reach remote areas in their markets.

82. Section 9(g)'s fee schedule establishes specific fees for

commercial television stations. These fees are to be assessed against a

licensee solely on the basis of the market in which the station

operates. The text of the schedule makes no distinction between

commercial stations that are fully operational and those that are

satellite stations. It is also clear that these satellite stations are

not ``translator stations,'' which are also listed in the schedule. TV

translator stations are low-powered facilities that rebroadcast the

signals of a full service television broadcast station, including a

satellite station, and are afforded secondary status vis-a-vis full

service television stations. Also, unlike satellite stations, they are

not subject to the technical, operational and program service

obligations that are imposed on all full service broadcast stations,

including satellite stations.\32\ Consequently, we find that in

establishing fees for commercial stations, Congress assessed the same

fee for both commercial fully operational and commercial satellite

television stations. We therefore reject KBS's argument that Congress

failed to establish a fee for television satellite stations. However,

there are anomalies concerning the treatment of satellite stations that

are a matter of concern to us and that we believe would be appropriate

for consideration on a case-by-case basis. First, where a licensee

would be required under the fee schedule to pay a higher fee for its

satellite station than for the parent station, we will entertain

petitions to reduce the satellite station's fee to the same amount as

the fee due for the parent station. In such a case, the licensee would

be required to submit with its request an amount no greater than the

fee due from the parent station. Second, in any situation in which

payment of the fee would cause a diminishment of a licensees ability to

continue to serve the public, we will entertain requests for waiver or

reduction of the fee upon an appropriate showing. In this instance, the

licensee would not be obligated to pay the fee until resolution of its

waiver request.

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\32\Unlike other full service television broadcast stations,

satellite stations have not been subject to the Commission's

multiple ownership restrictions. However, that distinction is

currently under review in our Second Further Notice of Proposed

Rulemaking in MM Docket No. 87-8, 6 FCC Rcd 5010 (1991).

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83. KBS and the NAB may submit comments in our future proceeding to

establish regulatory fees for FY 1995, supporting their positions

concerning the need to distinguish between satellite and fully

operational stations when assessing regulatory fees. As explained

above, for FY 1994, we shall make no adjustments to Congress' fee

schedule pursuant to section 9(b).

3. Broadcast Auxiliary Stations

84. The Society of Broadcast Engineers, Inc. (SBE) believes that

broadcast auxiliary facilities, such as remote pick-up stations, and

aural, television and low power auxiliary stations, should not be

subject to any regulatory fee. SBE explains that there is no

justification to apply a regulatory fee to these facilities since they

are essentially self-regulating and impose little burden on our

resources. As indicated above, we shall not modify any of section

9(g)'s fee requirements for FY 1994, but SBE may raise these issues in

future proceedings.

4. ITFS and DBS

85. Finally, the Joint Parties contend that we should amend the fee

schedule to add several services not subject to fees for FY 1994. These

services include the commercial offering of Instructional Television

Fixed Services (ITFS) and Direct Broadcast Satellite Service (DBS). We

decline the Joint Parties' request to add these services to the

schedule for 1994 since Congress did not provide us the authority to

add any service to the schedule for FY 1994. Moreover, we are aware

that ITFS is a predominantly nonprofit service with limited commercial

use and, further, that DBS is not expected to become operational prior

to the time for calculating fee payments for FY 1994.\33\ To the extent

that the Joint Parties wish to renew their arguments concerning the

inclusion of these services for future years, they may do so when we

consider our fee payment schedule for FY 1995.

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\33\The Joint Parties point out that the fee schedule contains

no explicit fee requirement for Multipoint Distribution Service

(MMDS). However, our schedule, modeled on the schedule contained in

section 9(g) of the Act, explicitly requires the payment of a

regulatory fee by Domestic Public Fixed licensees, operating under

Part 21 of our rules. Since MMDS is a Part 21 service, it is fully

subject to the regulatory fee prescribed for Part 21 licensees.

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C. Common Carrier Bureau

86. Most common carrier regulatory fees are based on the size of a

regulatee's communications operation as determined by its number of

stations, subscribers, access lines, or antennas. We intend to rely

upon the Common Carrier Bureau's licensing data bases to confirm the

identity and fee amount for most radio common carriers to the extent

possible. We also intend to perform periodic, random audits to

determine whether individual regulatees have reported the correct

multiplier.

1. Cellular and Public Mobile Licensees

87. The Personal Communications Industry Association (PCIA) states

that we should define the term ``subscriber'' as it applies to Part 22

and personal communications services licensees. PCIA suggests that we

require Part 22 licensees to pay their fees based on the number of

customers on their billing lists and urges that we permit Part 22

licensees to submit their fee payments pursuant to systemwide

aggregations of subscribers. Also, PCIA contends that we should permit

paging licensees to calculate their fees by aggregating their total

subscribers, rather determining their fee payments by call sign, as

required by section 9(g), and to submit one instrument of payment per

carrier system.\34\

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\34\PCIA also requests that we recalculate the regulatory fee

for CMRS for FY 1995. PCIA may submit its comments regarding the fee

for CMRS in the proceeding we establish to prescribe fees for FY

1995.

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88. Our rules do not define a mobile service subscriber. For

purposes of calculating regulatory fees, we will define a subscriber to

a mobile service as an individual or entity authorized by the mobile

service provider to operate under its blanket license in exchange for

monetary consideration. Further, any Part 22 licensee may submit a

single, aggregate payment to cover the regulatory fees due for each of

its individual systems. However, each individual system and service

should be clearly enumerated on the payor's FCC Form 159 accompanying

the fee payment. PCIA may submit its proposal to modify the method for

calculating fee payments by paging licensees in our proceeding for

establishing fees for FY 1995.

2. Air-Ground Radiotelephone Service

89. Claircom Communications Group, L.P., GTE and In-Flight Phone

Corporation request clarification of the definition of ``subscriber''

in section 9(g) when applied to the payment of regulatory fees for the

Air-Ground Telephone Service. Unlike conventional telephone service,

subscribers to that service, usually operators of commercial aircraft,

lease their service for the purpose of making it available to their own

customers. There is no contractual relationship between the air-ground

service operator and the end user of its service. Consequently, as

suggested by the parties, we will treat the operator of an aircraft in

which its service is installed as the subscriber to the service and

charge the fee based upon the number of transceivers leased by the

operator. Similarly, licensees in the air-ground service should include

in their total fee a payment on a transceiver basis for service they

provide to users other than commercial aircraft, such as private

aircraft.

3. Space Stations

90. Comsat General Corporation (Comsat), GE American

Communications, Inc. (GE American), Orbital Communications Corporation

(Orbital), PanAmSat, L.P. (Panamsat) and Starsys Global Postioning,

Inc. (Starsys) have submitted comments addressed to our proposals

concerning the requirements of satellite licensees to submit regulatory

fees. Comsat and GTE state that the regulatory fee for a geosynchronous

orbit space station is excessive. Comsat argues that the fee

requirement should be lowered for FY 1994 because these systems no

longer require the regulatory attention they received in their earlier

developmental stage. It argues that the fee also is a disincentive to

maintaining older and underutilized satellites in orbit for back-up

purposes and is anticompetitive and anticonsumer. As we have stated

earlier, we shall not adjust the schedule of fees that Congress has

enacted for the assessment of fees for FY 1994. Comsat may submit its

comments in the future proceeding that we will initiate in order to

establish appropriate fees for FY 1995.

91. We also received comments from Orbital and a reply comment from

Starsys concerning when a satellite space station becomes subject to

the fee requirement. Section 9(g) requires that the payment of a

regulatory fee by the operator of any ``operational'' space station in

geosynchronous orbit. We agree with the commenters that a satellite

does not become ``operational'' immediately upon its launch. Therefore,

as proposed by the commenters, we will consider a space station in

geosynchronous orbit to be subject to the fee when it has been

certified by its operator to be operational in accordance with section

25.120(d) of the rules. This certification indicates that the satellite

has been placed in its authorized orbit and is operating in the

authorized frequency bands at the authorized power levels. Similarly, a

space station or system will be considered to have terminated its

operation when its licensee certifies to us that the satellite has

ceased to operate.

92. Also, we will consider a space system in low earth orbit (LEO)

subject to the fee payment when its first satellite becomes operational

even though all its space stations are not yet operational. Similar to

our treatment of geosynchronous satellites, the system will become

subject to a fee payment upon the certification by the licensee that

the operations of the first satellite in its system conform to the

terms and conditions of its authorization pursuant to 47 CFR 25.120(d).

4. Earth Stations

93. AMSC Subsidiary Corporation contends that no payment of

regulatory fees for earth stations and mobile terminals should be

required until their related satellite system is operational.\35\

However, we observe that the licensing of satellite earth stations is

entirely separate from the licensing of space stations and that fixed-

satellite earth stations are generally licensed to operate with any and

all domestic satellite systems located in that portion of the

geostationary orbit for which the earth station has been frequency

coordinated. It is common practice for a satellite system to provide

preliminary service via unrelated space stations before its own

stations are launched and operational.

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\35\AMSC states that its satellite will be launched in December

1995, but that its earth and mobile stations will likely be licensed

before September 1994.

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94. We will require the licensee of an earth station to pay a fee

once it has certified that the earth station's construction is

completed. However, in those rare instances in which a license limits

an earth station's operational authority to a particular satellite

system and that system is not operational on the date for calculating

the fee, the fee will not be due until the first satellite of the

related system becomes ``operational'' within the meaning of our fee

rules.

5. Interexchange and Local Exchange Services

95. Generally, the comments of local exchange carriers (LECs) and

interexchange carriers (IXCs) raise issues concerning the basis upon

which they are to calculate their fee payments, the need for a

definition of the term ``subscriber,'' and a date for calculating their

fee payments.\36\

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\36\Allnet and MCI point out that resellers and pay telephone

operators are not among those regulatees listed in the fee schedule.

We will review whether these entities should be directly subject to

a fee payment in the course of our proceeding to determine

regulatory fees for FY 1995.

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96. We will adopt our proposal to permit the holding company of

local exchange carriers to aggregate fee payments due by its operating

companies and submit a single payment to cover the fee requirements of

its subsidiaries.\37\ We have considered the proposals of several

commenters, including Ameritech, Nynex and SWB, that LECs submit fees

based upon ARMIS data. However, ARMIS data is required from

comparatively few LECs and we would still need a mechanism to calculate

the fees due from the vast majority of LECs. Therefore, we have decided

that all LECs are to calculate the amount of their regulatory fees

based upon the number of working loops as described in section 36.611

of our rules, governing the submission of Information to the National

Exchange Carrier Association (NECA).\38\ We believe that this

definition will be simple to administer since the LECs currently

compile subscriber loop data, and it will provide a consistent

formulation for the assessment of fees from all LECs.\39\ As noted, for

FY 1994, we will require LECs to calculate their fee payments for FY

1994 as of December 31, 1993.\40\

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\37\We agree with Allnet that entities operating as both LECs

and IXCs are subject to a regulatory fee for both categories of

service. However, as GTE suggests, we will require a carrier to

submit only a single payment when a single commonly-owned line

serves as both a presubscribed line and an access line.

\38\NECA has proposed to process regulatory fees on behalf of

its pooling exchange carriers and to submit their consolidated fees

to our lockbox bank in a single instrument of payment. We have no

objection to NECA's submission of the fee on behalf of its pooling

exchange carriers or others. However, we remind entities subject to

the payment of a regulatory fee that the regulatee, not an agent,

such as NECA, is responsible for ensuring that the payment is made

that it is subject to penalty for failure to submit the entire fee

due in a timely manner. LECs will be expected to pay their fees

based upon the number of access lines as determined by NECA. In case

of a dispute between a carrier and NECA concerning the carrier's

line count as of December 31, 1993, NECA will certify its

calculation of the carrier's line count and the basis for its

calculation.

\39\We expect competitive access providers (CAPs) to submit fee

payments based upon their line count as required under section 9(g).

Ameritech, GTE and other interested parties may submit their views

on the proper method of assessing regulatory fees for CAPs in our

proceeding to establish fees for FY 1995.

\40\Several LECs, including Ameritech, GTE, NYNEX and Bell

South, opposed by Allnet, contend that their regulatory fee payments

qualify for exogenous treatment under the price cap rules and ask

that we allow their regulatory fee expense to be charged directly to

their subscribers. Their request is beyond the scope of this

proceeding. LECs seeking to charge their regulatory fees directly to

subscribers should petition for a waiver of the Commission's rules.

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97. In the NPRM, we invited comments concerning section 9(g)'s

assessment of regulatory fees from IXCs on a subscriber basis. In

response, AT&T, opposed by Wiltel, Inc., argues that fee payments by

IXCs should be based on gross revenues, not by the number of a

carrier's subscribers. We decline to reach the merits of AT&T's

argument at this time because, as indicated above, we shall not adjust

the fee schedule for FY 1994. Any reformulation of the basis upon which

IXCs are to base their fee payments would constitute a substantial

adjustment to the fee schedule that Congress enacted. IXCs shall file

fees based on the total number of common lines presubscribed to that

IXC as determined pursuant to section 69.116 of the rules. 47 C.F.R.

Sec. 69.116. AT&T may submit its views concerning the appropriate

method of assessing fees from IXCs in our proceeding to establish

regulatory fees for FY 1995.

6. International Bearer Circuits

98. Panamsat requests clarification concerning the assessment of

regulatory fees for international circuits. Section 9(g)'s Schedule

provides that the fee is to be computed ``per 100 active 64 KB circuits

or equivalent.'' The fee is to be paid by the facilities-based common

carrier activating the circuit in any transmission facility for the

provision of service to an end user or resale carrier. Private

submarine cable operators also are to pay fees for circuits sold on an

indefeasable right of use (IRU) basis or leased in their private

submarine cables to any customer of the private cable operator. In the

NPRM, we stated that the fee would be based upon active 64 KB circuits,

or equivalent circuits. Under this formulation, 64 KB circuits or their

equivalent will be assessed a fee. Equivalent circuits include the 64

KB circuit equivalent of larger bit stream circuits. For example, the

64 KB circuit equivalent of a 2.048 MB circuit is 30 64 KB circuits.

Analog circuits such as 3 and 4 KHz circuits used for international

services are also included as equivalent 64 KB circuits. However,

circuits derived from 64 KB circuits such as circuits derived by the

use of digital circuit multiplication systems are not equivalent 64 KB

circuits. Such circuits are not subject to fees. Only the 64 KB circuit

from which they have been derived will be subject to payment of a fee.

For analog television channels we will assess fees as follows:

------------------------------------------------------------------------

Analog television channel size in Number of equivalent 64 KB circuits

MHz

------------------------------------------------------------------------

36................................. 630

24................................. 288

18................................. 240

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D. Cable Services

99. Several commenters contend that the fee prescribed for cable

television services should be paid on an exact per subscriber count

rather than per 1,000 subscribers, as we proposed.\41\ These commenters

argue that the latter formulation would cause small cable systems to

pay a disproportionately high regulatory fee. For example, a cable

system with 100 subscribers would be subject to the same fee as a

system with 1,000 subscribers.

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\41\These commenters include the United States Small Business

Administration, Cable Services, Inc., the Cable Telecommunications

Association, the National Cable Television Associations, Nationwide

Communications, Inc. and the Small Cable Business Association.

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100. The text of section 9(g)'s fee schedule provides for the

assessment of a fee for cable television systems at the rate of $370.00

per 1,000 subscribers. Upon further consideration, we agree with the

commenters that Congress did not intend that this provision required

that a system pay its fee as if it served 1,000 subscribers when in

fact it provides services to fewer than 1,000 subscribers.\42\

Following this formulation to its logical extreme would impose on small

cable systems a disproportionate burden of the aggregate cable service

regulatory fee since it would result in the assessment of larger fees

upon small systems, particularly those with fewer than 1,000

subscribers. Thus, we believe Congress' purpose was to require cable

systems to formulate their fee based on the schedule's assessment of

$370.00 per 1000 subscribers, but to pay the fee on an exact per

subscriber count. Payment of the cable fee on the basis of the exact

count of a system's subscribers will eliminate the inequity perceived

by the commenters.

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\42\We reject the Joint Commenters' argument that the regulatory

fee for cable systems be reduced when any of a system's channels are

made available to competitors pursuant to 47 U.S.C. Sec. 532.

Congress has based the regulatory fee for cable systems upon the

number of subscribers served, not the number of a system's channels

available for the system's direct use.

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101. NCTA and Nationwide support our proposal to permit cable

systems to submit their regulatory fees on the basis of the aggregate

fee payable by commonly owned systems.\43\ Therefore, we will permit

commonly-owned cable systems to combine their fee payments for

submission to our lockbox bank. Finally, for purposes of calculating

the fee due from cable operators, we will adopt the definition of a

cable subscriber, including bulk rate subscriber, used for FCC Form

325. See FCC Form 325 Instructions (Page 3).

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\43\NCTA, the Joint Commenters and Continental request authority

for cable systems to pass through their regulatory fees to cable

television subscribers as extenal costs. Only those items currently

itemized in the rule as external costs may be passed through to

cable subscribers. Regulatory fees are not among the enumerated

items and the pass through process is not the subject of this

proceeding. Therefore, this matter should be addressed separately.

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V. Amendments to Application Fee Rules

102. In addition to the new rules for regulatory fees, we are

revising several sections of our rules governing fees associated with

applications and other filings. Filing fees are required pursuant to

section 8 of the Communications Act and are administered separately

from the regulatory fees authorized under section 9.\44\

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\44\We will publish in the FCC Record actions, including actions

taken on delegated authority, related to the application and

regulatory fee rules that have precedential value.

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A. Fees for Resubmitted Applications

103. We have amended Sec. 1.1107(d) of the rules, as proposed.

Section 1.1107(d) governs fee payments relating to applications and

other filings when resubmitted in the appropriate timeframe following a

staff request for additional or corrected information. We have amended

Sec. 1.1107(d) to require persons submitting applications or other

filings that have been returned for additional information or

corrections and that do not require any additional fees to submit these

applications and other filings directly to the Bureau/Office making the

request. Applications requiring additional fees must be filed at our

lockbox bank with the remittance for the entire additional amount due.

In the event that the staff discovers, within 30 days after the

resubmission, that the additional fee payment was not submitted, the

application or other filing will be dismissed as deficient and the

previously submitted section 8 fee payment will be retained under this

proposal. A new fee payment (covering the entire amount of the revised

fee) will be required with any future filing of the application or

other filing. However, if the staff discovers the fee payment

deficiency more than thirty days subsequent to the resubmission, the

application or other filing will be retained, but a 25 percent late fee

will be assessed on the deficient amount even if we have completed our

action on the application or other filing involved.

B. Stale Checks

104. Our lockbox bank will not process a personal or business check

dated more than six months prior to its submission. Therefore, we have

revised Sec. 1.1108(a) of the rules to make clear that these ``stale''

checks will not be accepted as fee payments. Under this revision, we

will not accept any instrument of payment dated more than six months

prior to the date of its filing with the lockbox bank, and we will

return to the filer any application or other filing submitted with a

stale payment instrument. Further, we will not accept any third party

checks (i.e., checks with the name of any third party as the maker or

endorser).

C. Receipts

105. Our practice with regard to stamped receipts for application

fee payments is to furnish receipts only upon specific request of the

submitter rather than to provide receipts automatically for all fee

payments received. We are clarifying these procedures by amending

Sec. 1.1108 of the rules. In order to obtain a receipt for a fee

payment, section 1.1108 will require that the application and fee

package include a copy of the first page of the application or other

filing, clearly marked ``copy,'' submitted expressly for the purpose of

serving as a receipt of the filing. The copy should be the top document

in the fee payment package. The staff will date-stamp the copy

immediately and provide it to the bearer of the submission, if hand

delivered. For submissions by mail, the receipt copy will be provided

through return mail if the filer has attached to the receipt copy a

stamped self-addressed envelope of sufficient size to contain the date-

stamped copy of the application. We will provide a receipt for

regulatory fee payments, upon request, if we are furnished with a copy

of Form 159 or the first page of an application in the private radio

services accompanying the fee payment and the request otherwise

conforms with the procedures we have adopted for receipts of

application fees.

D. Electronic Application Fee Payments

106. We are adopting rules regarding the submission of regulatory

fee payments by electronic means. Revised Secs. 1.1107 and 1.1108 of

the rules allow the payment of application and other filing fees by

electronic means, although our system for electronic payment is not yet

fully in place. In our NPRM, we stated our concern about matching

electronically paid fees with submitted hard-copy applications.\45\ If

a party chooses to pay its application filing fee electronically, we

will require that the entity follow existing procedures for filing its

application at the lockbox bank. However, in lieu of the current

payment methods, the party will indicate on its remittance advice (FCC

Form 159 or the underlying application form with fee information

incorporated therein) that payment is being sent to the bank

electronically. The electronic payment must be made on or before the

day the application is filed. Upon receipt of an application, the bank

will confirm that a fee payment has been received electronically. If

the electronic payment is not received on the filing date, the

application or request will be returned without processing. We believe

these procedures are necessary to ensure the most efficient processing

of electronic fee payments (when authorized) and applications or other

filings. Finally, during the pilot phase of our electronic payment

program, regulatees will be required to obtain our prior authorization

before making electronic fee payments. (See paragraphs 56 and 57,

above.)

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\45\We note that some parts of the Commission are currently

experimenting with electronic filing of applications.

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E. One Check/One Application Rule

107. We are modifying our rules to allow the use of a single

payment instrument or method to cover multiple applications for the

same or different applicants, so long as all the applications are filed

at the same time at the same lockbox. Any applicant desiring to pay for

multiple regulatory/application filings in the same lockbox with a

single payment instrument, or when paying by credit card, must also

complete FCC Form 159, FCC Remittance Advice. Each item must be listed

separately on the form with its own Payment Type Code. If another space

is needed for multiple filings, the applicant must use FCC Form 159-C,

FCC Remittance Advice Continuation Sheet.\46\

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\46\All non-private radio section 9 regulatory fee payors must

use FCC Form 159/159C when submitting single or multiple regulatory

fees.

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F. Payment by Cashier's Check

108. To ensure that payment instruments will result in a final

payment being made to the Commission, we believe that our cashier's

check safeguard should be strengthened. Accordingly, as proposed, when

a person or organization has, on one or more occasions, submitted a

payment instrument on which final payment is not received (and is not

excused by bank error), we will immediately notify the party that

future fee payments must be made by cashier's check until further

notice. If, subsequent to such notice, payment is not made by a

cashier's check (or cash), that party's other payment instrument will

not be accepted and its application or other filing will be returned.

47 CFR 1.1108(d)(1)(i); see also 47 CFR 1.1110(a).

G. Filing Locations for Petitions and Applications for Review

109. We have revised Secs. 1.1109(a)(3) and 1.1115 to clarify that

any petition for reconsideration, application for review, and any

petition for waiver or deferral of a fee payment, accompanied by an

application or regulatory fee payment, must be submitted to our lockbox

bank. If no fee payment is required and the matter is within the scope

of either the application or regulatory fee rules, the request should

be filed with the Secretary and clearly marked to the attention of the

Managing Director.

VI. Confidentiality

110. The Cellular Telecommunications Industry Association, GTE and

Southwestern Bell Corporation urge that we amend Sec. 0.457 of our

rules to safeguard the confidentiality of data submitted with

regulatory fees, including fee amounts that are calculated on a per

line or subscriber basis. 47 CFR 0.457. At this time, we will not amend

our rules to include a provision affording automatic confidentiality

for information submitted with regulatory fees. Generally, regulatees

are required to submit very little data with their fee payments and it

is premature for us to determine whether the disclosure of any

information submitted, including the fee amounts calculated on a per

subscriber basis, will warrant the protection afforded by Sec. 0.457.

Payments of regulatory fees may be accompanied by requests for

confidentiality pursuant to Sec. 0.459 of the Commission's rules. 47

CFR 0.459.

VII. Final Regulatory Analysis

111. Pursuant to the Regulatory Flexibility Act of 1980, the

Commission's final analysis is as follows:

A. Need and Purpose of This Action

112. This Report and Order adopts the Schedule of Regulatory Fees

enacted by Congress for the assessment and collection of the

Commission's regulatory fees for FY 1994 and adopts rules to govern the

assessment and collection of regulatory fees for FY 1994 and future

years. The rules, as required by Congress, include provisions for the

advance payment of small fees, the payment of large fees by

installment, and procedures for waiver, reduction and deferral of fees

by regulatees that demonstrate that payment of the fee would be a

financial hardship, as well as penalties for late or nonpayment of

fees.

B. Summary of Comments Raised by the Public Comments in Response to the

Initial Regulatory Flexibility Analysis

113. The Chief Counsel for Advocacy of the United States Small

Business Administration (SBA) filed comments urging that cable

television system operators be permitted to pay their fees on a per

subscriber basis ($.37) rather than in increments of 1,000 subscribers

($370.00) or any portion thereof. The Report and Order adopts the SBA's

proposal.

C. Significant Alternatives Considered

114. The Notice of Proposed Rulemaking in this proceeding offered

many proposals, including reliance on the Schedule of Regulatory Fees

as established by Congress in section 9(g) of the Communications Act,

47 U.S.C. 159(g), exemptions from regulatory fees, installment payments

for large fees, advance payments for small fees, payment procedures,

including payment by electronic transfer and credit card, procedures

for waiver, reduction and deferment of fees, and penalties for late or

nonpayment of fees. Our proposals to adopt the service categories and

fee amounts in Congress' fee schedule and for waiver, reduction and

deferment of fees were discussed by many commenters. Fireweed and the

Joint Commenters urged that we amend the fee schedule to reduce the

fees and add services subject to a fee payment. NAB and the State

Broadcasters urged that we modify our proposed procedures for

requesting a waiver, reduction or deferment of a fee payment. Upon

review, we affirmed that Congress intended that we utilize section

9(g)'s fee schedule for FY 1994. However, we adopted more flexible

procedures for obtaining a waiver, reduction or deferment of the fees

in order to afford more regulatees the opportunity to obtain a waiver,

reduction or deferment of the fees and we clarified the showing

required for adjustment of a fee based on financial hardship.

VIII. Ordering Clauses

115. Accordingly, it is ordered that the rule changes as specified

below are adopted.

116. It is further ordered that the rule changes made herein will

become effective 30 days after publication in the Federal Register.

This action is taken pursuant to sections 4(i), 4(j), 8, 9, and 303(r)

or the Communications Act, as amended, 47 U.S.C. Secs. 154(i) 154(j),

158, 159, 303(r).

List of Subjects

47 CFR Part 0

Authority delegations (Government agencies), Freedom of

information, Government publications, Reporting and recordkeeping

requirements.

47 CFR Part 1

Administrative practice and procedure, Communications common

carriers, Investigations, Penalties, Radio, Reporting and recordkeeping

requirements, Telecommunications, Television.

Federal Communications Commission.

William F. Caton,

Acting Secretary.

Rule Changes

47 CFR Parts 0 and 1 are amended as follows:

PART 0--COMMISSION ORGANIZATION

1. The authority citation for Part 0 continues to read:

Authority: Sec. 5, 48 Stat. 1068, as amended, 47 U.S.C. 155,

225, unless otherwise noted.

2. Section 0.231 is amended by revising paragraph (a) to read as

follows:

Sec. 0.231 Authority delegated.

(a) The Managing Director, or his designee, upon securing

concurrence of the General Counsel, is delegated authority to act upon

requests for waiver, reduction or deferment of fees, establish payment

dates, and issue notices proposing amendments or adjustments to the fee

schedules established under part 1, subpart G, of this chapter.

* * * * *

3. Section 0.406 is amended by revising paragraph (b)(2) to read as

follows:

Sec. 0.406 The rules and regulations.

* * * * *

(b) * * *

(2) Part 1 of this chapter, practice and procedure. Part 1, subpart

A, of this chapter contains the general rules of practice and

procedure. Except as expressly provided to the contrary, these rules

are applicable in all Commission proceedings and should be of interest

to all persons having business with the Commission. Part 1, subpart A

of this chapter also contains certain other miscellaneous provisions.

Part 1, subpart B, of this chapter contains the procedures applicable

in formal hearing proceedings (see Sec. 1.201 of this chapter). Part 1,

subpart C, of this chapter contains the procedures followed in making

or revising the rule or regulations. Part 1, subpart D, of this chapter

contains rules applicable to applications for licenses in the Broadcast

Radio Services, including the forms to be used, the filing

requirements, the procedures for processing and acting upon such

applications, and certain other matters. Part 1, subpart E, of this

chapter contains general rules and procedures applicable to common

carriers. Additional procedures applicable to certain common carriers

by radio are set forth in Part 21 of this chapter. Part 1, subpart F,

of this chapter contains rules applicable to applications for licenses

in the Private Radio Services, including the forms to be used, the

filing requirements, the procedures for processing and acting on such

applications, and certain other matters. Part 1, subpart G, of this

chapter contains rules pertaining to the application processing fees

established by the Consolidated Omnibus Budget Reconciliation Act of

1985 (Pub. L. 99-272, 100 Stat. 82 (1986)) and also contains rules

pertaining to the regulatory fees established by the Omnibus Budget

Reconciliation Act of 1993 (Pub. L. 103-66, 107 Stat. 397 (1993)). Part

1, subpart H, of this chapter, concerning ex parte presentations, sets

forth standards governing communications with commission personnel in

hearing proceedings and contested application proceedings. Part 1,

subparts G and H, of this chapter will be of interest to all

regulatees, and Part 1, subpart H, of this chapter will, in addition,

be of interest to all persons involved in hearing proceedings.

* * * * *

PART 1--PRACTICE AND PROCEDURE

4. The authority citation for Part 1 continues to read as follows:

Authority: 47 U.S.C. 151, 154, 303, and 309(j), unless otherwise

noted.

5. Section 1.742 is revised to read as follows:

Sec. 1.742 Place of filing, fees and number of copies.

All applications which do not require a fee shall be filed at the

Commission's main office in Washington, DC., Attention: Office of the

Secretary. Hand-delivered applications will be dated by the Secretary

upon receipt (mailed applications will be dated by the Mail Branch) and

then forwarded to the Common Carrier Bureau. All applications

accompanied by a fee payment should be filed with the Commission's

lockbox bank in accordance with Sec. 1.1105, Schedule of Fees. The

number of copies required for each application and the nonrefundable

processing fees and any applicable regulatory fees (see subpart G of

this part) which must accompany each application in order to qualify it

for acceptance for filing and consideration are set forth in the rules

in this Chapter relating to various types of applications. However, if

any application is not of the type covered by this Chapter, an original

and two copies of each such application shall be submitted.

5a. Sections 1.1106 through 1.1117 are redesignated as Secs. 1.1107

through 1.1118, respectively.

5b. In the list below, for each newly designated section indicated

in the left column, remove the reference indicated in the middle column

everywhere it appears, and add the reference indicated in the right

column:

------------------------------------------------------------------------

Section Remove Add

------------------------------------------------------------------------

1.1107................. Sec. 1.1105............ Sec. 1.1106.

1.1107................. Sec. 1.1111............ Sec. 1.1112.

1.1113 introductory Sec. 1.1105............ Sec. 1.1106.

text.

1.1113(d) and (e) Sec. 1.1112(c)......... Paragraph (c) of this

introductory text. section.

1.1113(e)(3)........... Sec. 1.1112(e)(2)...... Paragraph (e)(2) of

this section.

1.1114(a).............. Sec. 1.1105............ Sec. 1.1106.

1.1115(a).............. Sec. 1.1107(b)......... Sec. 1.1108(b).

1.1116(e).............. Sec. 1.1107............ Sec. 1.1108.

1.1118(b).............. Sec. 1.1110............ Sec. 1.1111.

------------------------------------------------------------------------

6. Newly designated Sec. 1.1108 is amended by revising paragraphs

(a) through (d) to read as follows:

Sec. 1.1108 Payment of charges.

(a) Electronic fee payments do not require the use of a FCC Form

159, Remittance Advice. An electronic fee payment must be made on or

before the day the application and appropriate processing form are

filed.

(b) The schedule of fees for applications and other filings lists

those applications and other filings that must be accompanied by a FCC

Form 159, Remittance Advice. A separate FCC Form 159 will not be

required once the information requirements of that form (payor

information) is incorporated into the underlying application form.

(c) Applications and other filings that are not submitted in

accordance with these instructions will be returned as unprocessable.

Note: This requirement for the simultaneous submission of fee

forms with applications or other filings does not apply to the

payment of fees for which the Commission has established a billing

process. See Sec. 1.1118 of this subpart.

(d) Applications returned to applicants for additional information

or corrections will not require an additional fee when resubmitted,

unless the additional information results in an increase of the

original fee amount. Those applications not requiring an additional fee

should be resubmitted directly to the Bureau/Office requesting the

additional information. The original fee will be forfeited if the

additional information or corrections are not resubmitted to the

appropriate Bureau/Office by the prescribed deadline. If an additional

fee is required, the original fee will be returned and the application

must be resubmitted with a new remittance in the amount of the required

fee to the Commission's lockbox bank. Applicants should attach a copy

of the Commission request for additional or corrected information to

their resubmission.

(1) If the Bureau/Office staff discovers within 30 days after the

resubmission that the required fee was not submitted, the application

will be dismissed.

(2) If after 30 days the Bureau/Office staff discovers the required

fee has not been paid, the application will be retained and a 25

percent late fee will be assessed on the deficient amount even if the

Commission has completed its action on the application. Any Commission

actions taken prior to timely payment of these charges are contingent

and subject to recession.

* * * * *

7. Newly designated Sec. 1.1109 is amended by revising paragraphs

(a), (d) and (f) to read as follows:

Sec. 1.1109 Form of payment.

(a) Fee payments should be in the form of a check, bank draft, on

money order denominated in U.S. dollars and drawn on a United States

financial institution and made payable to the Federal Communications

Commission or by a Visa or MasterCard credit card. No other credit card

is acceptable. Fees for applications and other filings paid by credit

card will not be accepted unless the credit card section of FCC Form

159 is completed in full. The Commission discourages applicants from

submitting cash and will not be responsible for cash sent through the

mail. Personal or corporate checks dated more than six months prior to

their submission to the Commission's lockbox bank and postdated checks

will not be accepted and will be returned as deficient. Third party

checks (i.e., checks with a third party as maker or endorser) will not

be accepted.

(1) Specific procedures for electronic payment will be announced by

Public Notice. Applicants must submit a written request to the

Commission for authorization to make electronic payments of a fee for

applications and other filings, as follows.

(2) No electronic payment of an application fee will be accepted

unless the payor has obtained the written authorization of the

Commission to submit application fees electronically. It is the

responsibility of the payor to insure that any electronic payment is

made in the manner required by the Commission. Failure to comply with

the Commission's procedures will result in the return of the

application or other filing and the fee payment.

(3) Payments by wire transfer will be accepted. Prior to making a

payment by wire, the payor shall obtain the approval of the Managing

Director or his designee. A completed FCC Form 159 shall be submitted

to the Managing Director or his designee prior to initiating the wire

transfer.

* * * * *

(d) The Commission may require payment of fees with a cashier's

check upon notification to an applicant or filer or prospective group

of applicants under the conditions set forth below in paragraphs (d)

(1) and (2) of this section.

(1) Payment by cashier's check may be required when a person or

organization has made payment, on one or more occasions with a payment

instrument on which the Commission does not receive final payment and

such failure is not excused by bank error.

(2) The Commission will notify the party in writing that future

payments must be made by cashier's check until further notice. If,

subsequent to such notice, payment is not made by cashier's check, the

party's payment will not be accepted and its application or other

filing will be returned.

* * * * *

(f) The Commission will furnish a stamped receipt of an application

only upon request. In order to obtain a stamped receipt for an

application (or other filing), the application package must include a

copy of the first page of the application, clearly marked ``copy'',

submitted expressly for the purpose of serving as a receipt of the

filing. The copy should be the top document in the package. The copy

will be date-stamped immediately and provided to the bearer of the

submission, if hand delivered. For submissions by mail, the receipt

copy will be provided through return mail if the filer has attached to

the receipt copy a stamped self-addressed envelope of sufficient size

to contain the date stamped copy of the application. No remittance

receipt copies will be furnished.

8. Newly designated Sec. 1.1110 is amended by revising paragraph

(a) to read as follows:

Sec. 1.1110 Filing locations.

(a) Except as noted in this section applications and other filings,

with attached fees and FCC Form 159, must be submitted to the locations

and addresses set forth in Secs. 1.1102 through 1.1106.

(1) Tariff filings shall be filed with the Secretary, Federal

Communications Commission, Washington, DC 20554. On the same day, the

filer should submit a copy of the cover letter, the FCC Form 159, and

the appropriate fee to the Commission's lockbox bank at the address

established in Sec. 1.1105.

(2) Bills for collection will be paid at the Commission's lockbox

bank at the address for the appropriate service as established in

Secs. 1.1102 through 1.1106, as set forth on the bill sent by the

Commission. Payments must be accompanied by the bill and a FCC Form 159

to ensure proper credit.

(3) Petitions for reconsideration or applications for review of fee

decisions pursuant to Sec. 1.1117(b) of this subpart must be

accompanied by the required fee for the application or other filing

being considered or reviewed.

(4) Applicants claiming an exemption from a fee requirement for an

application or other filing under 47 U.S.C. 158(d)(1) or Sec. 1.1113 of

this subpart shall file their applications in the appropriate location

as set forth in the rules for the service for which they are applying,

except that request for waiver accompanied by a tentative fee payment

should be filed at the Commission's lockbox bank at the address for the

appropriate service set forth in Secs. 1.1102 through 1.1105.

* * * * *

9. Newly designated Sec. 1.1116 is amended by revising the section

heading and paragraph (c) to read as follows:

Sec. 1.1116 Petitions and applications for review.

* * * * *

(c) Petitions for waivers, deferrals, fee determinations,

reconsideration and applications for review will be acted upon by the

Managing Director. Petitions and applications for review submitted with

a fee must be submitted to the Commission's lockbox bank at the address

for the appropriate service set forth in Secs. 1.1102 through 1.1105.

If no fee payment is required, and the matter is within the scope of

the fee rules in this subpart, the petition or application for review

should be filed with the Commission's Secretary and clearly marked to

the attention of the Managing Director. Requests for deferral of a fee

payment for financial hardship must be accompanied by supporting

documentation.

* * * * *

10. Section 1.1151 is added to read as follows:

Sec. 1.1151 Authority to prescribe and collect regulatory fees.

Authority to impose and collect regulatory fees is contained in

title VI, section 6002(a) of the Omnibus Budget Reconciliation Act of

1993 (Pub. L. 103-66, 107 Stat. 397), enacting section 9 of the

Communications Act, 47 U.S.C. 159, which directs the Commission to

prescribe and collect annual regulatory fees from designated regulatees

in order to recover the costs of certain of its regulatory activities

in the private radio, mass media, common carrier, and cable television

services.

11. Section 1.1152 is added to read as follows:

Sec. 1.1152 Schedule of annual regulatory fees and filing locations

for private radio service.

------------------------------------------------------------------------

Fee

Services amount Address

------------------------------------------------------------------------

Exclusive use services (per

license)

1. Land Mobile (Above 470 MHZ, $16.00 FCC, Land Mobile, P.O. Box

Base Station and SMRS) (47 ____\1\ Pittsburgh, PA 15251-

CFR Part 90). 5---

2. Microwave (47 CFR Part 94). 16.00 FCC, Microwave, P.O. Box

____\1\ Pittsburgh, PA 15251-

5---

3. Interactive Video Data 16.00 FCC, IVDS, P.O. Box ____\1\

Service. Pittsburgh, PA 15251-5---

Shared Use Services........... 7.00 FCC, Shared Use Services, P.O.

Box ____\1\ Pittsburgh, PA

15251-5---

Amateur Vanity Call Signs..... 7.00 FCC, Amateur Vanity Call

Signs, P.O. Box ____\1\

Pittsburgh, PA 15251-5---

------------------------------------------------------------------------

Note 1: Refer to Private Radio Service Fee Filing Guide for

appropriate Post Office Box. Fee Filing Guides may be obtained by

writing to the Federal Communications Commission, Public Service

Division, room 254, Washington, DC 20554.

12. Section 1.1153 is added to read as follows:

Sec. 1.1153 Schedule of annual regulatory fees and filing locations

for mass media services.

------------------------------------------------------------------------

Fee

Services amount Address

------------------------------------------------------------------------

AM Radio (47 CFR Part 73):

1. Class D Daytime.......... $250.00 FCC, AM Branch, P.O. Box

358835, Pittsburgh, PA 15251-

5835.

2. Class A Fulltime......... 900.00 ..............................

3. Class B Fulltime......... 500.00 ..............................

4. Class C Fulltime......... 200.00 ..............................

5. Construction Permits..... 100.00 ..............................

FM Radio (47 CFR Part 73):

1. Classes C, C1, C2, B..... 900.00 FCC, FM Branch, P.O. Box

358835, Pittsburgh, PA 15252-

5835.

2. Classes A, B1, C3........ 600.00 ..............................

3. Construction Permits..... 500.00 ..............................

TV (47 CFR Part 73) VHF

Commercial:

1. Markets 1 thru 10........ 18,000 FCC, TV Branch, P.O. Box

358835, Pittsburgh, PA 15251-

5835.

2. Markets 11 thru 25....... 16,000 ..............................

3. Markets 26 thru 50....... 12,000 ..............................

4. Markets 51 thru 100...... 8,000 ..............................

5. Remaining Markets........ 5,000 ..............................

6. Construction Permits..... 4,000 ..............................

UHF Commercial:

1. Markets 1 thru 10........ 14,400 FCC, UHF Commercial, P.O. Box

358835, Pittsburgh, PA 15251-

5835.

2. Markets 11 thru 25....... 12,800 ..............................

3. Markets 26 thru 50....... 9,600 ..............................

4. Markets 51 thru 100...... 6,400 ..............................

5. Remaining Markets........ 4,000 ..............................

6. Construction Permits..... 3,200 ..............................

Low Power TV, TV Translator, 135 FCC, Low Power, P.O. Box

and TV Booster (47 CFR Part 358835, Pittsburgh, PA 15251-

74). 5835.

Broadcast Auxiliary........... 25 FCC, Auxiliary, P.O. Box

358835, Pittsburgh, PA 15251-

5835.

International (HF) Broadcast.. 200 FCC, International, P.O. Box

358835, Pittsburgh, PA 15251-

5835.

------------------------------------------------------------------------

13. Sec. 1.1154 is added to read as follows:

Sec. 1.1154 Schedule of annual regulatory charges and filing locations

for common carrier services.

------------------------------------------------------------------------

Fee

Services amount Address

------------------------------------------------------------------------

Radio Facilities:

1. Cellular Radio (per 1,000 $60 FCC, Cellular, P.O. Box

subscribers). 358835, Pittsburgh, PA 15251-

5835.

2. Personal Communications.. 60 ..............................

3. Space Station (geo orbit) 65,000 ..............................

4. Space Station (low earth) 90,000

5. Public Mobile (per 1,000 60 ..............................

subscribers).

6. Domestic Public Fixed.... 55 ..............................

7. International Public 110

Fixed.

Earth Stations:

1. VSAT and Equivalent C- 6 FCC, Earth Station, P.O. Box

Band antennas (per 100 358835, Pittsburgh, PA 15251-

antennas). 5835.

2. Mobile Satellite Earth 6

Stations (per 100 antennas).

3. Less than 9 meters (per 6

100 antennas).

4. 9 Meters or More Transmit/ 85 ..............................

Receive and Transmit Only

(per meter).

Receive Only (per meter).... 55 ..............................

Carriers:

1. Inter-Exchange Carrier 60 FCC, Carriers, P.O. Box

(per 1,000 presubscribed 358835, Pittsburgh, PA 15251-

lines). 5835.

2. Local Exchange Carrier 60 ..............................

(per 1,000 access lines).

3. Competitive Access 60 ..............................

Provider (per 1,000

subscribers).

4. International Circuits 220 ..............................

(per 100 active 64 KB

circuit or equivalent).

------------------------------------------------------------------------

14. Sec. 1.1155 is added to read as follows:

Sec. 1.1155 Schedule of regulatory fees and filing locations for cable

television services

------------------------------------------------------------------------

Fee

Services amount Address

------------------------------------------------------------------------

1. Cable Antenna Relay Service $220 FCC, Cable, P.O. Box 358835,

Pittsburgh, PA 15251-5835.

2. Cable TV System (per 1,000 370

subscribers).

------------------------------------------------------------------------

15. Section 1.1156 is added to read as follows:

Sec. 1.1156 Payment of charges for regulatory fees.

Payment of a regulatory fee, required under Secs. 1.1152 through

1.1155, shall be filed in the following manner:

(a) Payments of regulatory fees shall be submitted with the filing

of any application for a new, renewal or reinstatement of a license or

other authorization in the private radio services.

(1) Any regulatory fee submitted with an application in the private

radio services shall include an advance payment of the total annual

regulatory fee payment due for the entire term of the license or other

authorization. The amount of the regulatory fee payment due with any

application in the private radio service shall be the multiple of the

number of years in the entire term of the requested license or other

authorization multiplied by the annual fee payment required in the

Schedule of Regulatory Fees, effective at the time the application is

filed. Except as set forth in Sec. 1.1159, advance payments shall be

final and shall not be readjusted during the term of the license or

authorization, notwithstanding any subsequent increase or decrease in

the annual amount of a fee required under the Schedule of Regulatory

Fees.

(2) Failure to file the appropriate regulatory fee with an

application in the private radio service will result in the return of

the accompanying application, including an application for which the

Commission has assigned a specific filing deadline.

(b)(1) Payments of standard regulatory fees, applicable to mass

media, common carrier and cable services, shall be filed in full on an

annual basis at a time announced by the Commission or the Managing

Director, pursuant to delegated authority, and published in the Federal

Register.

(2) Large regulatory fees, as annually defined by the Commission,

may be submitted in installment payments.

(i) For Fiscal Year 1994, large regulatory fees may be submitted in

two (2) equal installment payments at times announced by the Commission

or the Managing Director, pursuant to delegated authority, and

published in the Federal Register.

(ii) For Fiscal Year 1994, installment payments may be submitted

for:

(A) VHF and UHF Commercial Television Stations with a fee

requirement above $12,000;

(B) Cable Television Systems whose community units' fee payments

total more than $18,500;

(C) Inter-Exchange Carriers with a fee requirement above $500,000;

(D) Local Exchange Carriers or Holding Companies with a fee

requirement above $700,000; and

(E) Space Stations with a fee of $65,000 or above.

(iii) Beginning in Fiscal Year 1995, payors of a large standard

regulatory fee, as annually defined by the Commission, may submit their

fee payments in four (4) equal installments at times to be announced by

the Commission or by the Managing Director, pursuant to delegated

authority, and published in the Federal Register.

(c) Standard regulatory fee payments, as well as any installment

payment, must be filed with a FCC Form 159, FCC Remittance Advice, and

a FCC Form 159C, Remittance Advice Continuation Sheet, if additional

space is needed. Failure to submit a copy of FCC Form 159 with a

standard regulatory fee payment, or an installment payment, will result

the return of the submission and a 25 percent penalty if the payment is

resubmitted after the date the Commission establishes for the payment

of standard regulatory fees and for any installment payment.

(1) Any late filed regulatory fee payment will be subject to the

penalties set forth in Sec. 1.1163.

(2) If one or more installment payments are untimely submitted or

not submitted at all, the eligibility of the subject regulatee to

submit installment payments may be cancelled and the regulatee required

to pay its fee in a single annual payment.

16. Section 1.1157 is added to read as follows:

Sec. 1.1157 Form of payment for regulatory fees.

Any regulatory fee payment must be submitted in the form of a

check, bank draft or money order denominated in U.S. dollars and drawn

on a United States financial institution and made payable to the

Federal Communications Commission or by Visa or Mastercard credit cards

only. The Commission discourages applicants from submitting cash

payments and will not be responsible for cash sent through the mail.

Personal or corporate checks dated more than six months prior to their

submission to the Commission's lockbox bank and postdated checks will

not be accepted and will be returned as deficient.

(a) Upon authorization from the Commission following a written

request, electronic payment of a regulatory fee may be made as follows:

(1)(i) The payor may instruct its bank to make payment of the

regulatory fee directly to the Commission's lockbox bank; or

(ii) The payor may authorize the Commission to direct its lockbox

bank to withdraw funds directly from the payor's bank account.

(2) No electronic payment of a regulatory fee will be accepted

unless the payor has obtained the written authorization of the

Commission to submit regulatory fees electronically. Procedures for

electronic payment of regulatory fees will be announced by Public

Notice. It is the responsibility of the payor to insure that any

electronic payment is made in the manner required by the Commission.

Failure to comply with the Commission's procedures for electronic fee

payment will result in the return of the fee payment, and a penalty fee

of 25 percent if the subsequent refiling of the fee payment is late.

Failure to comply will also subject the payor to the penalties set

forth in section 1.1163.

(b) Multiple payment instruments for a single regulatory fee are

not permitted, except that the Commission will accept multiple money

orders in payment of any fee where the fee exceeds the maximum amount

for a money order established by the issuing entity and the use of

multiple money orders is the only practicable means available for

payment.

(c) Payment of multiple standard regulatory fees (including an

installment payment) due on the same date, may be made with a single

payment instrument and cover mass media, common carrier and cable

service fee payments. Each regulatee is solely responsible for

accurately accounting for and listing each license or authorization and

the number of subscribers, access lines, or other relevant units on the

accompanying FCC Form 159 and, if needed, FCC Form 159C and for making

full payment for every regulatory fee listed on the accompanying form.

Any omission or payment deficiency of a regulatory fee will result in a

25 percent penalty of the amount due and unpaid.

(d) Any regulatory fee payment (including a regulatory fee payment

submitted with an application in the private radio service) made by

credit card or money order must be submitted with a completed FCC Form

159. Failure to accurately enter the credit card number and date of

expiration and the payor's signature in blocks number 22 and 23 of FCC

Form 159 will result in rejection of the credit card payment.

17. Section 1.1158 is added to read as follows:

Sec. 1.1158 Filing locations and receipts for regulatory fees.

(a) Regulatory fee payments must be directed to the location and

address set forth in sections 1.1152 through 1.1155 for the specific

category of fee involved. Any regulatory fee required to be submitted

with an application must be filed as a part of the application package

accompanying the application. The Commission will not take

responsibility for matching fees, forms and applications submitted at

different times or locations.

(b) Petitions for reconsideration or applications for review of fee

decisions submitted with a standard regulatory fee payment pursuant to

Secs. 1.1153 through 1.1155 are to be filed with the Commission's

lockbox bank in the manner set forth in Secs. 1.1153 through 1.1155 for

payment of the fee subject to the petition for reconsideration or the

application for review. Petitions for reconsideration and applications

for review that are submitted with no accompanying payment should be

filed with the Secretary, Federal Communications Commission, Attention:

Managing Director, Washington, DC 20554.

(c) Any request for exemption from a regulatory fee shall be filed

with the Secretary, Federal Communications Commission, Attention:

Managing Director, Washington, DC 20554, except that requests for

exemption accompanied by a tentative fee payment shall be filed at the

lockbox set forth for the appropriate service in Secs. 1.1152 through

1.1155.

(d) The Commission will furnish a receipt for a regulatory fee

payment only upon request. In order to obtain a receipt for a

regulatory fee payment, the package must include an extra copy of the

Form FCC 159 or, if a Form 159 is not required with the payment, a copy

of the first page of the application or other filing submitted with the

regulatory fee payment, submitted expressly for the purpose of serving

as a receipt for the regulatory fee payment and application fee

payment, if required. The document should be clearly marked ``copy''

and should be the top document in the package. The copy will be date

stamped immediately and provided to the bearer of the submission, if

hand delivered. For submissions by mail, the receipt copy will be

provided through return mail if the filer has attached to the receipt

copy a stamped self-addressed envelope of sufficient size to contain

the receipt document.

18. Section 1.1159 is added to read as follows:

Sec. 1.1159 Refunds of regulatory fees.

(a) Regulatory fees will be refunded, upon request, only in the

following instances:

(1) When no regulatory fee is required or an excessive fee has been

paid. In the case of an overpayment, the refund amount will be based on

the applicants', permittees', or licensees' entire submission. All

refunds will be issued to the payor named in Block Number 3 of the FCC

Form 159.

(2) In the case of advance payment of regulatory fees, subject to

Sec. 1.1152, a refund will be issued based on unexpired full years:

(i) When the Commission adopts new rules that nullify a license or

other authorization, or a new law or treaty renders a license or other

authorization useless;

(ii) When a licensee in the private radio service surrenders the

license or other authorization subject to a fee payment to the

Commission; or

(iii) When the Commission declines to grant an application

submitted with a regulatory fee payment.

(3) When a waiver is granted in accordance with Sec. 1.1165 of this

subpart.

(b) No pro-rata refund of an annual fee will be issued.

(c) No refunds will be issued based on unexpired partial years.

(d) No refunds will be processed without a written request from the

applicant, permittee, licensee or agent.

19. Section 1.1160 is added to read as follows:

Sec. 1.1160 Conditional license grants and delegated authorizations.

(a) Grant of any application or an instrument of authorization or

other filing, for which a regulatory fee is required to accompany the

application or filing, will be conditioned upon final payment of the

regulatory fee. Final payment shall mean receipt by the U.S. Treasury

of funds cleared by the financial institution on which the check, bank

draft, money order, credit card, wire or electronic payment is drawn.

(1) If, prior to a grant of an instrument of authorization, the

Commission is notified that final payment of the regulatory fee has not

been made, the application or filing:

(i) Will be dismissed and returned;

(ii) Shall lose its place in the processing line; and

(iii) Will not be treated as timely filed if resubmitted after the

relevant filing deadline.

(2) If, subsequent to a grant of an instrument of authorization or

other filing, the Commission is notified that final payment has not

been made, the Commission will:

(i) Automatically rescind that instrument of authorization;

(ii) Notify the grantee of this action; and

(iii) Treat as late filed any application resubmitted after the

original deadline for filing the application.

(3) Upon receipt of a notification of rescission of the

authorization, the grantee will immediately cease operations initiated

pursuant to the authorization.

(b) In those instances where the Commission has granted a request

for deferred payment of a regulatory fee, further processing of the

application or filing or the grant of authority shall be conditioned

upon final payment of the regulatory fee and any required penalties for

late payment prescribed by the deferral decision. Failure to comply

with the terms of the deferral decision shall result in the automatic

dismissal of the submission or rescission of the Commission

authorization. Further, the Commission shall:

(1) Notify the grantee that the authorization has been rescinded.

Upon such notification, the grantee will immediately cease operations

initiated pursuant to the authorization; and

(2) Treat as late filed any application resubmitted after the

original deadline for filing the application.

(c) Where the procedures described in paragraphs (a) and (b) of

this section would not provide a meaningful incentive to pay a

regulatory fee that is due or would not be a meaningful sanction for

failure to pay such a fee, the Commission may, in its discretion,

whether the regulatory fee is required to be paid with an application

for an instrument of authorization or otherwise, withhold processing

and/or grant of any application or filing made by a person or

organization who has failed to make full payment of any regulatory fee

due.

(1) Before taking such action, the staff will make a written

request for the fee, together with any penalties that may be rendered

under this subpart. Such request shall inform the regulatee that

failure to pay may result in the Commission withholding action on any

application or request filed by the applicant. The staff shall also

inform the regulatee of the procedures for seeking Commission review of

the staff's fee determination.

(2) If, after final determination that the fee is due, payment is

not made in a timely manner, the staff may terminate processing and/or

withhold any grant or petition requested by the person or organization

subject to the fee payment requirement, until the matter is resolved.

20. Section 1.1161 is added to read as follows:

Sec. 1.1161 General exemptions from regulatory fees.

No regulatory fee established in Secs. 1.1152 through 1.1155 of

this subpart, unless otherwise qualified in this section shall be

required for:

(a) Applicants, permittees or licensees in the Amateur Radio

Service, except that any person requesting a vanity call-sign,

following July 18, 1994 shall be subject to the payment of a regulatory

fee, as prescribed in Sec. 1.1152 of this Subpart.

(b) Applicants, permittees, or licensees who qualify as government

entities. For purposes of this exemption, a government entity is

defined as any state, possession, city, county, town, village,

municipal corporation, or similar political organization or subpart

thereof controlled by publicly elected or duly appointed public

officials exercising sovereign direction and control over their

respective communities or programs.

(c) Applicants, permittees or licensees who qualify as nonprofit

entities. For purposes of this exemption, a nonprofit entity is defined

as an organization possessing nonprofit, tax exempt status under

section 501 of the Internal Revenue Code, 26 U.S.C. 501.

(d) Applicants, permittees or licensees in the Special Emergency

Radio and Public Safety Radio services.

(e) Applicants, permittees or licensees of noncommercial

educational broadcast stations in the FM or TV services, as well as AM

applicants permittees or licensees operating in accordance with

Sec. 73.503 of this chapter.

(f) Applicants, permittees or licensees qualifying under

Sec. 1.1161(e) requesting Commission authorization in any other mass

media radio service (except the international broadcast (HF) service),

private radio service, or common carrier communications service

requiring payment of a regulatory fee, if the service is used in

conjunction with their noncommercial educational broadcast station on a

noncommercial educational basis.

(g) Other applicants, permittees or licensees providing, or

proposing to provide, a noncommercial educational or instructional

service, but not qualifying under Sec. 1.1161(e), may be exempt from

regulatory fees, or be entitled to a refund, in the following

circumstances:

(1) The applicant, permittee or licensee is an organization that,

like the Public Broadcasting Service or National Public Radio, receives

funding directly or indirectly through the Public Broadcasting Fund, 47

U.S.C. 396(k), distributed by the Corporation for Public Broadcasting,

where the authorization requested will be used in conjunction with the

organization on a noncommercial educational basis;

(2) An applicant, permittee or licensee of a translator or low

power television station operating proposing a noncommercial

educational service who, after grant, provides proof that it has

received funding for the construction of the station through the

National Telecommunications and Information Administration (NTIA) or

other showings as required by the Commission; or

(3) An applicant, permittee, or licensee provided a fee refund

under Sec. 1.1159 and operating as a noncommercial education station,

is exempt from fees for broadcast auxiliary stations (Part 74, Subparts

D, E, and F, of this chapter) or stations in the private radio or

common carrier services where such authorization is to be used in

conjunction with the noncommercial educational translator or low power

station.

(h) An applicant, permittee or licensee that is the licensee of an

instructional television fixed station is exempt from regulatory fees

where the authorization requested will be used by the applicant in

conjunction with the provision of the instructional service.

(i) Applications filed in the private radio service for the sole

purpose of modifying an existing authorization (or a pending

application for authorization). However, if the applicant also requests

a renewal or reinstatement of its license or other authorization for

which the submission of a regulatory fee is required, the appropriate

regulatory fee for such additional request must accompany the

application.

21. Section 1.1162 is added to read as follows:

Sec. 1.1162 Adjustments to regulatory fees.

(a) For Fiscal Year 1994, the amounts assessed for regulatory fees

are set forth in Secs. 1.1152 through 1.1155.

(b) For Fiscal Year 1995 and thereafter, the Schedule of Regulatory

Fees, contained in Secs. 1.1152 through 1.1155, may be adjusted

annually by the Commission pursuant to section 9 of the Communications

Act. 47 U.S.C. 159. Adjustments to the fees established for any

category of regulatory fee payment shall include of projected cost

increases or decreases of the in volume of licensees or units upon

which the regulatory fee is calculated.

(c) The fees assessed shall:

(1) Be derived by determining the full-time equivalent number of

employees performing enforcement activities, policy and rulemaking

activities, user information services, and international activities

within the Private Radio Bureau, Mass Media Bureau, Common Carrier

bureau, Cable Services Bureau and other offices of the Commission,

adjusted to take into account factors that are reasonably related to

the benefits provided to the payor of the fee by the Commission's

activities, including such factors as service coverage area, shared use

versus exclusive use, and other factors that the Commission determines

are necessary in the public interest;

(2) Be established at amounts that will result in collection,

during each fiscal year, of an amount that can reasonably be expected

to equal the amount appropriated for such fiscal year for the

performance of the activities described in paragraph (c)(1) of this

section.

(d) The Commission shall by rule amend the Schedule of Regulatory

Fees by proportionate increases or decreases that reflect, in

accordance with paragraph (c)(2) of this section changes in the amount

appropriated for the performance of the activities described in

paragraph (c)(1) of this section for such fiscal year. Such

proportionate increases or decreases shall be adjusted to reflect

unexpected increases or decreases in the number of licensees or units

subject to payment of such fees and result in collection of an

aggregate amount of fees that will approximately equal the amount

appropriated for the subject regulatory activities.

(e) The Commission shall, by rule, amend the Schedule of Regulatory

Fees if the Commission determines that the Schedule requires amendment

to comply with the requirements of paragraph (c)(1) of this section. In

making such amendments, the Commission shall add, delete or reclassify

services in the Schedule to reflect additional deletions or changes in

the nature of its services as a consequence of Commission rulemaking

proceedings or changes in law.

(f) In making adjustments to regulatory fees, the Commission will

round such fees to the nearest $5.00 in the case of fees under

$1,000.00, or to the nearest $25.00 in the case of fees of $1,000.00 or

more.

22. Section 1.1163 is added to read as follows:

Sec. 1.1163 Penalties for late or insufficient regulatory fee

payments.

Any late payment or insufficient payment of a regulatory fee, not

excused by bank error, shall subject the regulatee to a 25 percent

penalty of the amount of the fee or installment payment which was not

paid in a timely manner. A timely fee payment or installment payment is

one received at the Commission's lockbox bank by the due date specified

by the Commission or by the Managing Director. A payment will also be

considered late filed if the payment instrument (check, money order,

bank draft or credit card) is uncollectible.

(a) The Commission may, in its discretion, following one or more

late filed installment payments, require a regulatee to pay the entire

balance of its regulatory fee by a date certain, in addition to

assessing a 25 percent penalty.

(b) In cases where a fee payment fails due to error by the payor's

bank, as evidenced by an affidavit of an officer of the bank, the date

of the original submission will be considered the date of filing.

(c) If a regulatory fee is not paid in a timely manner, the

regulatee will be notified of its deficiency. This notice will

automatically assess a 25 percent penalty, subject the delinquent

payor's pending applications to dismissal, and may require a delinquent

payor to show cause why its existing instruments of authorization

should not be subject to rescission.

(d)(1) Where a regulatee's new, renewal or reinstatement

application is required to be filed with a regulatory fee (as is the

case with private radio services), the application will be dismissed if

the regulatory fee is not included with the application package. In the

case of a renewal or reinstatement application, the application may not

be refiled unless the appropriate regulatory fee plus the 25 percent

penalty charge accompanies the refiled application.

(2) If the application that must be accompanied by a regulatory fee

is a mutually exclusive application with a filing deadline, or any

other application that must be filed by a date certain, the application

will be dismissed if not accompanied by the proper regulatory fee and

will be treated as late filed if resubmitted after the original date

for filing the application.

(e) Any pending or subsequently filed application submitted by a

party will be dismissed if that party is determined to be delinquent in

paying a standard regulatory fee or an installment payment. The

application may be resubmitted only if accompanied by the required

regulatory fee and by any assessed penalty payment.

(f) In instances where the Commission may revoke an existing

instrument of authorization for failure to file a regulatory fee, the

Commission will provide prior notice to the regulatee of such action

and shall allow the licensee no less than 60 days to either pay the fee

or show cause why the payment assessed is inapplicable or should

otherwise be waived or deferred.

(1) An adjudicatory hearing will not be designated unless the

response by the regulatee to the Order to Show Cause presents a

substantial and material question of fact.

(2) Disposition of the proceeding shall be based upon written

evidence only and the burden of proceeding with the introduction of

evidence and the burden of proof shall be on the respondent regulatee.

(3) Unless the regulatee substantially prevails in the hearing, the

Commission may assess costs for the conduct of the proceeding against

the respondent regulatee. See 47 U.S.C. 402(b)(5).

(4) Any regulatee failing to submit a regulatory fee, following

notice to the regulatee of failure to submit the required fee, is

subject to collection of the fee, including interest thereon, any

associated penalties, and the full cost of collection to the F

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