Assessment and Collection of Regulatory Fees for Fiscal Year 1996

Federal RegisterJul 12, 1996

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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Parts 1 and 64

[MD Docket No. 96-84; FCC 96-295]

Assessment and Collection of Regulatory Fees for Fiscal Year 1996

AGENCY: Federal Communications Commission.

ACTION: Final rule.

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SUMMARY: The Commission has revised its Schedule of Regulatory Fees in

order to recover the amount of regulatory fees that Congress has

required it to collect for fiscal year 1996. Section 9 of the

Communications Act of 1934, as amended, provides for the annual

assessment and collection of regulatory

[[Page 36630]]

fees. For fiscal year 1996 sections 9(b)(2) and (3) provide for annual

``Mandatory Adjustments'' and ``Permitted Amendments'' to the Schedule

of Regulatory Fees. These revisions will further the National

Performance Review goals of reinventing Government by requiring

beneficiaries of Commission services to pay for such services.

EFFECTIVE DATE: September 10, 1996.

FOR FURTHER INFORMATION CONTACT: Peter W. Herrick, Office of Managing

Director at (202) 418-0443, or Terry D. Johnson, Office of Managing

Director at (202) 418-0445.

SUPPLEMENTARY INFORMATION:

Adopted: July 1, 1996;

Released: July 5, 1996.

By the Commission: Commissioner Chong concurring and issuing a

statement in which Commissioner Quello joins at a later date.

Table of Contents

Paragraph

Topic Nos.

I. Introduction............................................ 1-4

II. Background............................................. 5-7

III. Discussion............................................ 8-73

A. Overall Methodology................................... 8-11

B. Adjustment of Payment Units........................... 12

C. Adjustment of Television Station Fees................. 13

D. Recalculation of Fees--Mandatory Adjustments.......... 14

E. Proposed Permitted Amendments......................... 15-50

1. Commercial Mobile Radio Service....................... 16-22

2. Commercial AM/FM Radio................................ 23-29

3. Commercial VHF/UHF Television Stations................ 30-32

4. Auxiliary Broadcast Stations.......................... 33-36

5. Intelsat & Inmarsat Signatory......................... 37-47

6. Low Earth Orbit (LEO) Satellite Systems............... 48-49

7. Minimum Fee Payment Liability......................... 50

F. Additional Regulatory Fee Issues...................... 51-68

1. Cable Television Systems.............................. 51-57

2. International Bearer Circuits......................... 58-65

3. National Exchange Carriers Association................ 66-67

4. Mobile Satellite Service (MSS)........................ 68

G. Procedures for Payment of Regulatory Fees............. 69-74

1. Annual Payments of Standard Fees...................... 70-72

2. Installment Payments for Large Fees................... 73

3. Advance Payments of Small Fees........................ 74

H. Schedule of Regulatory Fees........................... 75

IV. Ordering Clause........................................ 76

V. Authority and Further Information....................... 77-78

Appendix A--Final Regulatory Flexibility Analysis

Appendix B--Sources of Payment Unit Estimates

Appendix C--Calculation of Pro-Rata Adjustments

Appendix D--Schedule of Regulatory Fees

Appendix E--Comparison Between FY 1995, Proposed FY 1996 and Final

FY 1996 Fees

Appendix F--Detailed Guidance on Who Must Pay Regulatory Fees

Appendix G--Description of FCC Activities

Appendix H--Parties Filing Comments and Reply Comments

Final Rules

I. Introduction

1. By this Report and Order, the Commission completes its

rulemaking proceeding to revise its Schedule of Regulatory Fees in

order to recover the amount of regulatory fees that Congress, pursuant

to Section 9(a) of the Communications Act, has required it to collect

for Fiscal Year (FY) 1996. See 47 U.S.C. Sec. 159(a).

2. For FY 1996, Congress has required that we collect $126,400,000

in regulatory fees in order to recover the costs of our enforcement,

policy and rulemaking, international and user information activities

for FY 1996. Public Law No. 104-134 and 47 U.S.C. Sec. 159(a)(2). This

is $10 million more than Congress designated for recovery through

regulatory fees for FY 1995. See Assessment and Collection of

Regulatory Fees for Fiscal Year 1995, FCC 95-227, released June 19,

1995, 60 FR 34004 (June 29, 1995). See FY 1995 Report and Order, 10 FCC

Rcd 13531. It is also $10 million more than Congress initially required

us to collect in regulatory fees for FY 1996.\1\ See Notice of Proposed

Rulemaking in the Matter of Assessment and Collection of Regulatory

Fees for Fiscal Year 1996, FCC 96-153, released April 9, 1996, 61 FR

16432 (April 15, 1996). The current Schedule of Regulatory Fees

(``Schedule'') is set forth in Sections 1.1152 through 1.1156 of the

Commission's rules. 47 CFR Secs. 1.1152-1.1156.

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\1\ Subsequent to the April 9, 1996 release of our NPRM in this

proceeding, the Congress passed and the President signed on April

26, 1996, H.R. 3019 (Public Law No. 104-134), 110 STAT. 1321, which

changed the total amount of regulatory fees to be collected in FY

1996 from $116.4 million (contained in Public Law No. 104-99) to

$126.4 million.

3. In addition to adjusting our Section 9 regulatory fees to ensure

collection of the $126.4 million that Congress requires us to collect

in FY 1996, we are also adjusting the Schedule and associated payment

procedures to reflect changes to certain fee amounts recently mandated

by Congress in Public Law No. 104-134, to reflect changes in the

estimated number of payment units associated with services subject to a

fee and to incorporate certain public interest considerations. See 47

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U.S.C. 159(b).

4. Finally, we are amending the Schedule in order to assess

regulatory fees upon licensees and/or regulatees of services not

currently subject to payment of a fee, to simplify and streamline the

Schedule and to clarify and/or revise certain payment procedures. 47

U.S.C. Sec. 159(b)(3). Except where noted, in those instances where we

received no comments on a proposal set forth in our NPRM, we are

adopting the proposal without further discussion.

II. Background

5. Section 9(a) of the Communications Act of 1934, as amended,

requires us to assess and collect annual regulatory fees to recover the

costs, as determined annually by Congress, that we incur in carrying

out enforcement, policy and rulemaking, international, and user

information activities. 47 U.S.C. 159(a). In our FY 1994 Report and

Order, 59 FR 30984 (June 16, 1994), 9 FCC Rcd 5333, we adopted the

Schedule of Regulatory Fees that Congress established and we prescribed

rules to govern payment of the fees, as required by Congress. 47 U.S.C.

Sec. 159(b), (f)(1). Subsequently, in our FY 1995 Report and Order, we

modified the Schedule to increase by approximately 93 percent the

revenue generated by our regulatory fees due to the increased amount

that Congress required us to collect in FY 1995. 60 FR 34004 (June 29,

1995). Also, in the FY 1995 Report and Order, we amended certain rules

governing our regulatory fee program based upon our experience

administering the program in FY 1994. See 47 CFR Secs. 1.1151 et seq.

6. As noted above, for FY 1994 we adopted the Schedule of

Regulatory Fees established in Section 9(g) of the Act. For fiscal

years after FY 1994, however, Sections 9(b)(2) and (3), respectively,

provide that we adjust our fees by making ``Mandatory Adjustments'' and

``Permitted Amendments'' to the Schedule of Regulatory Fees. 47 U.S.C.

159(b)(2), (b)(3). Section 9(b)(2), entitled

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``Mandatory Adjustments'', requires that we revise the Schedule of

Regulatory Fees whenever Congress changes the amount that we are to

recover. 47 U.S.C. 159(b)(2).

7. Section 9(b)(3), entitled ``Permitted Amendments,'' requires

that we determine annually whether to adjust the fees to take into

account factors that are reasonably related to the benefits provided to

the payors of the fees and factors that are in the public interest. In

making these amendments, we are to ``add, delete, or reclassify

services in the Schedule to reflect additions, deletions or changes in

the nature of its services.'' 47 U.S.C. 159(b)(3). Section 9(i)

requires that we develop accounting systems necessary to making

permitted amendments. 47 U.S.C. 159(i). Finally, we are required to

notify Congress of any permitted amendments 90 days before those

amendments go into effect. 47 U.S.C. 159(b)(4)(B).

III. Discussion

A. Overall Methodology

8. As noted above, Congress has required that we recover

$126,400,000 for FY 1996 through the collection of regulatory fees,

representing the costs applicable to our enforcement, policy and

rulemaking, international, and user information activities. 47

Sec. U.S.C. 159(a).

9. In our NPRM, we proposed to develop our fees for FY 1996 by

first adjusting our estimates of payment units so that we could

determine how much revenue we would collect even if we did not change

any individual fee amounts. We then compared the total estimated

revenue that we would collect at the existing fee amounts to the total

revenues that we are required to collect in FY 1996 ($126.4 million),

and pro-rated the difference among all the existing fee categories.\2\

We then intended to compare these projected revenues with cost data

accumulated from our new cost accounting system and to make any further

adjustments necessary to ensure that costs generally correlated with

revenues in each fee category. As discussed in the NPRM, this step was

not performed due to implementation problems associated with our new

cost accounting system.

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\2\ As noted earlier, Congress increased the amount to be

collected in FY 1996 from $116.4 million to $126.4 million

subsequent to release of our NPRM in this proceeding.

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10. We next considered various recommendations made by our Bureaus'

and Offices' managers concerning adjustments to the fees and to our

collection procedures. The results of these actions, the detailed steps

we followed in the development of our proposed FY 1996 regulatory fees,

and a proposed new Schedule of Regulatory Fees were presented in our

NPRM.\3\ In addition, we provided detailed descriptions of each fee

category, information on the entity responsible for payment of each

fee, and other critical information designed to assist potential fee

payers in determining the extent of fee liability, if any, for FY 1996.

We invited interested parties to comment on our proposed methodology

and on our various proposals to revise the Schedule of Regulatory Fees.

We are adopting the same general methodology, as set forth in

Paragraphs 12-14 below, for developing FY 1996 regulatory fees as we

proposed in our NPRM.

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\3\ Permitted amendments are being made pursuant to Section

9(b)(3) to incorporate CMRS Mobile Services, CMRS One-Way Paging,

Intelsat & Inmarsat Signatory, and Low Earth Orbit (LEO) Satellite

Systems regulatory fee categories and to make related changes to

Geosynchronous Space Station fees. These new permitted amendments

will require 90 days Notice to Congress prior to implementation. 47

U.S.C. 159(b)(4)(B). However, it should be noted that for the CMRS

Mobile Services, licensees who have not elected to convert their

stations from private to commercial status will not be subject to

payment of a CMRS Mobile Services regulatory fee for FY 1996.

Therefore, for stations licensed as commercial on or before the date

of determination of fee liability the fee will become effective 60

days from the date of publication in the Federal Register. See para.

17-22.

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11. While we received no comments specifically supporting or

opposing the proposed methodology, the law firm of Bernstein and

McVeigh contends that regulatees are entitled to a fee payment credit

because the Federal government, including the Commission, was closed

for business for significant periods due to budget disputes and

snowstorms resulting in substantially lower regulatory expenditures

than anticipated. However, we have no discretion in the amount that we

are required to collect since it is Congress that annually establishes

the amount that we are to collect through regulatory fees. See 47

U.S.C. 159(a). Thus, Bernstein and McVeigh's pleading requires no

further discussion.

B. Adjustment of Payment Units

12. In order to calculate individual service fees for FY 1996, we

first adjusted the estimated payment units for each service because, in

many services, payment units have changed substantially since last

year. We obtained our estimates through a variety of means, including

our licensee data bases, actual prior year payment records, and

industry and trade group projections. Herein, we are further adjusting

certain payment units to reflect refinements to our unit counts since

adoption of our NPRM. Appendix B provides a summary of how payment

units were determined for each fee category.

C. Adjustment of Television Station Fees

13. On April 26, 1996, the President signed H.R. 3019 (Public Law

No. 104-134), ``The Balanced Budget Downpayment Act.'' This

legislation, in addition to requiring that we collect $126.4 million in

regulatory fees, revised the fees for television broadcast licensees

set forth in Section 1.1153 of our rules.\4\ As Congress has required,

we have incorporated its revised television station fees into our

Schedule of Regulatory Fees for FY 1996.

D. Recalculation of Fees--Mandatory Adjustments

14. We next determined the amount of revenue to be collected from

television station licensees based on the new fee amounts established

by Congress, as discussed in Paragraph 13. See Appendix C. We

subtracted our estimated television revenues ($10,060,000) from the

total amount that Congress requires us to collect in FY 1996

($126,400,000). The difference ($116,340,000) is the amount to be

recovered from all other regulatees in order to meet Congress'

requirement for FY 1996. We then multiplied the revised payment unit

estimates for FY 1996 by the corresponding FY 1995 fee amounts in each

non-television fee category to determine the revenue we would collect

in FY 1996, assuming no other change to the FY 1995 fees. Next, we

adjusted the revenue requirements for each fee category on a

proportional basis, consistent with Section 9(b)(2) of the Act, in

order to insure that we would collect approximately $116,340,000 from

these fee categories. Finally, we recalculated the individual fee

amounts in order to collect the adjusted amount in each service, and

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\4\ Specifically, Public Law No. 104-134 made the following changes to

Section 1.1153:

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FY 1995 New FY

Fee category (VHF/UHF Television stations) fee 1996 fee

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VHF Markets 1-10.................................... $22,420 $32,000

VHF Markets 11-25................................... 19,925 26,000

VHF Markets 26-50................................... 14,950 17,000

VHF Markets 51-100.................................. 9,975 9,000

Remaining VHF Markets............................... 6,225 2,500

UHF Markets 1-10.................................... 17,925 25,000

UHF Markets 11-25................................... 15,950 20,000

UHF Markets 26-50................................... 11,950 13,000

UHF Markets 51-100.................................. 7,975 7,000

Remaining UHF Markets............................... 4,975 2,000

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[[Page 36632]]

rounded each fee amount as provided by Section 9(b)(2).\5\ Appendix C

provides detailed calculations describing how the revised fee amounts

were determined.

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\5\ Section 9(b)(2) requires that we round fees to the nearest

$5 in the case of fees under $1,000, or to the nearest $25 in the

case of fees of $1,000 or more. 47 U.S.C. 159(b)(2).

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E. Proposed Permitted Amendments

15. In our NPRM, we proposed certain changes and additions to our

current fee categories and to our methodologies for assessing fees in

individual service categories. We have given full consideration to the

comments by interested parties and, in certain instances, we have

decided that further adjustments to the Schedule of Regulatory Fees are

warranted based upon the public interest and other criteria established

in 47 U.S.C. 159(b)(3). Each of these changes is discussed below

together with any comments we received in response to our NPRM.

However, as noted above, we will not discuss further any of our

proposals from the NPRM which received no comments. Instead, these

proposals are incorporated as proposed in our NPRM or are not adopted

in those cases in which we proposed not to change our current rules and

procedures. These include: Commercial AM/FM/TV Construction Permits,

where we considered and rejected including the revenue requirement in

the fees for the broadcast station licensees; Wireless Cable, where we

considered and rejected the idea of basing the payment units on

subscriber counts instead of on a per license basis; Direct Broadcast

Satellite (DBS) Service, where we also considered and rejected a

proposal to establish payment units on a subscriber basis rather than

per satellite; Interstate Telephone Service Providers, where we

proposed to consolidate several service categories into one category;

and Earth Stations, where we also proposed to consolidate several

service categories into one category.

1. Commercial Mobile Radio Service (CMRS)

16. In the NPRM, we proposed to establish a CMRS Mobile Services

fee category and to include in the category cellular providers and CMRS

service licensees authorized to provide interconnected mobile radio

services for profit to the public, or to such classes of eligible users

as to be effectively available to a substantial portion of the public.

See NPRM at para. 19. We stated that the new CMRS Mobile Services

category was intended to replace the Public Mobile/Cellular Radio

regulatory fee category and that certain mobile services assigned to

the Private Land Mobile Radio Service fee category for FY 1995 would be

included in the new CMRS category for FY 1996.\6\ Also, we proposed to

defer assessing a regulatory fee upon licensees in the Personal

Communications Service (PCS) because PCS is in a very early start-up

phase. Finally, we proposed that CMRS Mobile Services fee payors

calculate their annual regulatory fee based on their total mobile or

cellular unit (mobile or cellular call sign or telephone number) count,

or on their total per unit (two-way pager) count, as determined on

December 31, 1995.

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\6\ Specifically, we proposed that the CMRS Mobile Service fee

category would include cellular providers (Part 22) and Business

Radio Services, 220-222 MHz Land Mobile Systems, Specialized Mobile

Radio Services (Part 90); Public Coast Stations (Part 80); Public

Mobile Radio, 800 MHz Air-Ground Radiotelephone, and Offshore Radio

Services (Part 22). Licensees who have not elected to convert from

private to commercial operations will be exempt from payment of the

annual CMRS Mobile Services fee for FY 1996. Existing commercial

licensees and those who elected to convert prior to December 31,

1995, must pay the annual CMRS Mobile Services fee for FY 1996.

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17. The American Mobile Telecommunications Association, Inc. (AMTA)

and Nextel Communications, Inc. (Nextel) oppose including Specialized

Mobile Radio (SMR) licensees and other mobile communications providers,

previously assigned to one of the Private Mobile Radio Services (PMRS)

fee categories, in the CMRS Mobile Services fee category for FY 1996.

The parties contend that these mobile service providers are not

properly subject to the CMRS Mobile Services fee because their

operations were not a part of the CMRS service on December 31, 1995,

the date for calculating the CMRS Mobile Services fee, and, in fact,

will not convert to CMRS status until August 10, 1996. AMTA and Nextel

also urge that we exclude from the CMRS Mobile Services category any

mobile units that do not have full interconnection capability with the

public switched network. In addition, Nextel contends that, given the

competitive status of CMRS providers, we should not subject some new

mobile service providers to a CMRS Mobile Services fee and defer

imposition of the requirement on other new providers, such as PCS.

Instead, AMTA and Nextel urge that current mobile service providers pay

no fee or remain in the PMRS fee category. Finally, AMTA contends that

existing mobile licensees who have paid their regulatory fees in

advance should not be subject to a CMRS Mobile Services fee until they

file applications for renewal or reinstatement. In the alternative,

AMTA and Nextel contend that current licensees that become subject to

the CMRS Mobile Services fee before their existing licenses expire are

entitled to a credit for the remaining years of their advance fee

payments.

18. In the Omnibus Budget Reconciliation Act of 1993, Congress

provided that private carrier systems, including 220-222 MHz and SMR

services, providing interconnected mobile radio services for profit to

the public, or to such classes of eligible users as to be effectively

available to a substantial portion of the public, were to be

reclassified as CMRS licensees.\7\ Congress provided a three year

transition period pursuant to which private carrier licensees

authorized prior to August 10, 1993, would continue to be regulated as

private carriers until August 10, 1996. Therefore, we agree with the

commenters that we should not require licensees that will not become

subject to CMRS regulation until August 10, 1996, to pay a CMRS Mobile

Services fee for FY 1996. Further, we agree with the parties that

existing CMRS licensees should include in their calculations of the

CMRS Mobile fee only those units operational on December 31, 1995.

Also, as a result of this decision, we have reduced our estimate of the

number of payment units for this category.

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\7\ See Omnibus Budget Reconciliation Act of 1993, Public Law

No. 103-66, Title VI Sec. 6002(b), 107 Stat. 312, 392.

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19. However, we do not agree that CMRS units that do not fully

connect with the public switched network should not be subject to the

CMRS fee. Consistent with Sections 9(a) and 9(b), our CMRS Mobile

Services fee is based upon the costs of our regulatory oversight. As

such, we will require mobile providers to submit a CMRS Mobile Services

fee based upon our regulatory costs rather than the particular use that

a provider makes of its frequencies. Therefore, mobile operators,

otherwise subject to the CMRS Mobile Services fee, should submit a CMRS

Mobile services fee for any unit operating under the authority of a

license authorizing the operator to provide ``for profit'' service to

the public and to interconnect its services with the public switched

network, without limitation, or to such classes of eligible users as to

be effectively available to a substantial portion of the public, as

[[Page 36633]]

described in Section 20.3 of our Rules.\8\ 47 CFR 20.3.

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\8\ For regulatory fee purposes, ``distress'' traffic is not

included as part of a public coast station licensee's subscriber

count.

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20. In addition, we reject Nextel's argument that, because we have

decided that PCS licensees should not be subject to the fee for FY

1996, all new providers of CMRS service should be excepted from payment

of the CMRS Mobile Services fee. Unlike other services within the CMRS

category of services, PCS has only recently been established and few

PCS providers are now operational. In contrast, SMR licensees, such as

Nextel, have long been eligible to provide mobile service, including

interconnection with the public switched network, and thus, although

they may be newly assigned to CMRS, these operators cannot be said to

be new providers of mobile services.

21. We recognize that some current mobile service providers have

paid Private Land Mobile fees covering the length of their license

term. However, we decline to defer assessing a CMRS fee on these

licensees until the expiration of their current licenses.\9\ In our

NPRM, we stated that payors of advance fees would not have these fees

``adjusted'' during their license term. See NPRM at para. 56. Our clear

purpose was to assure payors of advance fees that we would not require

any additional payment if we increased the fee amount required for the

fee category in which the payment was made. It was not our intent that

licensees transferred from one fee category to another would not be

subject to the fee payment required by their new fee category until the

expiration of their current license. Nevertheless, under our Rules, a

licensee is entitled to a refund of an advance payment, upon request,

whenever we ``adopt new rules that nullify a license or other

authorization.'' 47 CFR 1.1159(2)(i). Therefore, any licensee that

converts from private to CMRS and has paid its fees in advance for a

period of years, may file a request for refund with its initial CMRS

regulatory fee payment. Detailed procedures for refund requests will be

issued by Public Notice.

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\9\ Because Private Land Mobile regulatory fees are submitted

with license applications and paid for the number of years in the

term of the license, these licensees have paid their regulatory fees

several years in advance. See 47 U.S.C. 159(f)(2).

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22. Destineer, Inc., a PCS licensee, asks that we establish a CMRS

Messaging Service fee category to replace our CMRS One-Way Paging fee

category. Destineer recognizes that, as a PCS provider, it is not

subject to any fee payment for FY 1996. However, it states that, with

the exception of two-way paging services, our CMRS Mobile category

includes only broadband services and that broadband services, unlike

paging services, provide for real time two-way interactive voice

communications. We agree with Destineer that there are important

regulatory, technical and competitive differences between the two

narrowband and broadband services that may warrant establishing a fee

category that would include all narrowband services, including two-way

paging. However, Destineer has provided us with no information

concerning how to structure its proposed fee category, e.g., estimated

units that would be included in the category for FY 1996 or the impact

of the new fee category on revenues from our CMRS Mobile fee category.

Therefore, we will adopt our proposed CMRS Mobile Services and CMRS

One-Way Paging fee categories for FY 1996, but we invite interested

parties to file proposals and comments on alternative methods to assess

CMRS fees in our proceeding to establish regulatory fees for FY 1997.

2. Commercial AM/FM Radio

23. In our NPRM, we discussed a proposal to assess regulatory fees

for Commercial AM and FM radio licensees according to the size of a

station's market, but concluded that development of a market-based fee

assessment methodology for radio broadcast stations appeared to be not

cost effective. See FCC 96-153 at para. 20.\10\ As a result, we

proposed to assess radio broadcast fees solely on the basis of class of

license, utilizing the statutory fee structure that we adopted for FY

1994 and FY 1995. 47 U.S.C. 159(g). In our NPRM, we invited comments

proposing alternatives to the current radio fee structure. Id. at para.

21.

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\10\ In our FY 1995 NPRM, we recognized ``that the population

density of a station's geographic location was also a public

interest factor warranting recognition in the fee schedule.'' FCC

95-14 at para. 29. Subsequently, we declined to adopt a market-based

fee structure for AM and FM radio because we were unable to develop

a reliable and accurate method for differentiating among radio

markets. See FY 1995 Report and Order, 10 FCC Rcd at 13531-532.

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24. The Montana Broadcasters Association (Montana) filed comments

proposing a radio broadcast service fee structure based on class of

station and on market size. Montana maintains that its proposed fee

structure is similar to the fee structure that Congress enacted for

television broadcast stations and that it would more fairly allocate

regulatory fees among radio stations by reducing the fees for small

market radio stations and increasing them for larger stations. See 47

U.S.C. 159(g).

25. Montana's proposed fee structure takes into account both a

station's market size and the classification of its facilities. The

proposed fee structure establishes broad groupings of radio broadcast

markets determined by market size. It assigns a different level of fees

for each market grouping predicated on the ratios between fees that

Congress initially assessed for licensees in different sized television

markets. Montana proposes four specific market classifications: Markets

1 through 25, Markets 26 through 50, Markets 51 through 100, and

Remaining Markets. Stations are assigned to a market grouping based

upon Arbitron Rating Co. (Arbitron) market designations. Montana

proposes ratios between fees paid by larger market radio broadcast

stations and fees paid by remaining market radio broadcast stations as

follows:

Markets 1 through 25--1 to 3.4\11\

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\11\ See Montana's petition, n. 4 at p 4. The ratios that

Montana employs are those that Congress established in its fee

structure for television broadcast regulatory fees. See 47 U.S.C.

Sec. 159(g). The Montana proposal would raise the fees for stations

in larger markets and reduce the fees in smaller markets. For

example the NPRM proposed a regulatory fee for Class A AM stations

of $1,125. Utilizing the proposed Montana Schedule, Class A stations

in remaining markets would have their fees reduced to $850; while

Class A stations in Markets 1 through 25 would pay $2,890; in

Markets 26 through 50 they would pay $2,040 and in Markets 51-100

they would pay $1,360. We note that Congress recently directed the

Commission to modify the regulatory fee schedule to increase the

differential between the fees paid by major market television

stations and fees paid by television stations located outside of the

top 50 markets. Utilizing new ratios between fees paid by television

in larger and smaller markets based on the relationship between the

fees Congress has established would further increase the

differential between payments by radio stations in larger and

smaller markets.

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Markets 26 through 50--1 to 2.4

Markets 51 through 100--l to 1.6

26. Montana assigns different classes of stations to each market by

relying on an analysis of the broadcast markets conducted by Dataworld

MediaXpert Service. According to Montana, its proposed rate structure

would result in aggregate revenue to the Commission approximating the

amount to be recovered from AM and FM licensees through the fee

structure proposed in our NPRM. Although the Montana proposal would

raise the fees for radio stations in the top 100 markets, no comments

were filed by parties who would be adversely affected by the proposal.

27. Montana proposes to utilize the Dataworld data base which in

turn is based on Arbitron market rankings. Inour

[[Page 36634]]

FY 1995 Report and Order, we found that a proposal to base fees on

Arbitron data did not provide a sufficiently accurate and equitable

methodology for determining fees. 10 FCC Rcd at 531-532. Moreover,

because Congress recently mandated that we amend the regulatory fee

schedule for television stations, we believe that further evaluation of

the proposal is necessary in order to determine the proper ratio

between fees for radio stations in different markets and to evaluate

the impact of this change. See H.R. 3019, H. Rept. 104-537.

28. As a result, for FY 1996, we have decided to adopt the basic

fee structure proposed in our NPRM, which differentiates between

licensees based on the class of a station's license. The fees therein

are low enough so that they should not be an onerous burden on most

licensees, and our policy is to grant waivers of the fees where our

licensees can make a showing of a compelling case of financial

hardship.

29. We agree, however, that there may be inequities in requiring

all radio stations of the same class to pay the same fee without regard

to the size of their market, particularly since stations serving

greater populations generally have greater revenues than stations

serving smaller markets. Thus, we believe that the Montana proposal

warrants further study and consideration. It is our intention to

consider the Montana proposal, or some modification thereof, for

assessment of the FY 1997 fees. We will be commencing, subsequent to

this proceeding, a Notice of Inquiry in order to develop a more

appropriate methodology for assessing AM and FM fees. We invite

interested parties to comment on Montana's proposal and to submit

alternative AM and FM fee methodologies for our consideration in the

context of that proceeding.

3. Commercial VHF/UHF Television Stations

30. Subsequent to the release of the FY 1996 NPRM, Congress

required that we revise Section 1.1153 of the rules in order to

increase the fees for VHF and UHF Television Stations located in the

top 50 markets and to reduce the fees for stations in the 51 to 100

largest markets and in the remaining markets category. Public Law No.

104-134. Therefore, as required by Congress, we will amend Section

1.1153 of our rules to include the specific fees that Congress

determined should be assessed licensees in the Television Broadcast

Service for FY 1996. See Appendix D for a listing of the FY 1996

Television Broadcast fees.

31. In our NPRM we proposed to rely on Nielsen DMA rankings to

determine the appropriate regulatory fee for television licensees in FY

1996 because Arbitron has ceased publication of its Areas of Dominant

Influence that we formerly relied upon. See NPRM at para. 27. Southern

Broadcast Corporation of Sarasota (Southern), licensee of Station

WWSB(TV), Sarasota, Florida, opposes reliance on Nielsen DMA's because,

as calculated by the DMA, its market rank would change to the 15th

largest DMA market from the 153rd ADI market. As a result, Southern

will be subject to a substantially higher fee than it has previously

been assessed.

32. We have decided to rely on Nielsen's DMA market rankings, as

proposed. As noted above, current Arbitron data for assessing

television regulatory fees is no longer available. Nielsen data is

generally accepted throughout the industry and will be updated and

published annually by Warren Publishing in its Television and Cable

Factbook. While the change may result in some licensees being assigned

to new markets, this is not a basis for rejecting Nielsen markets.

Nielsen markets may, in fact, provide a more accurate reflection of an

applicant's service area than do Arbitron markets. We will consider the

equities concerning the fees of licensees that change markets on a

case-by-case basis, upon request, and, where a licensee demonstrates

that it does not serve its assigned market, we will consider reducing

the assigned fees to a more equitable level, based upon the area

actually served by the licensee.

4. Auxiliary Broadcast Stations

33. This fee category includes licensees of Remote Pickup Stations,

Aural Broadcast Auxiliary Stations, Television Broadcast Auxiliary

Stations, and Low Power Auxiliary Stations, authorized under Part 74 of

the Commission's Rules. These stations are generally associated with a

particular television or radio broadcast station or cable television

system.

34. In an attempt to simplify the Fee Schedule, our NPRM considered

the feasibility and equity of combining Auxiliary Broadcast Station

fees with the primary fees paid by broadcast station licensees and

cable television operators into a single, consolidated fee. Although a

consolidated fee has certain advantages, there are significant problems

with using this approach and we found that such a fee would likely

result in serious inequities since larger commercial broadcast stations

and cable systems in the most profitable markets are more likely to

utilize multiple auxiliary stations. While a consolidated fee would

have little impact on stations serving larger populations, it could

result in less profitable stations in smaller markets subsidizing

regulatory fees for stations serving larger markets. Thus, our NPRM

proposed to retain Auxiliary Broadcast Station fees as a separate

category in FY 1996.

35. The Society of Broadcast Engineers (SBE) urges reduction or

elimination of the Auxiliary Broadcast Station fee. It contends that

frequency coordination and regulation of these facilities are in large

part conducted by volunteers and supported by voluntary contributions

from the industry. In SBE's view, imposition of a regulatory fee on

broadcast auxiliary stations could ``possibly place the entire program

of SBE-affiliated frequency committees in jeopardy.''

36. We have decided to not reduce or eliminate the Auxiliary

Broadcast Station fee. We cannot conclude that our proposed regulatory

fee would adversely impact voluntary coordination of auxiliary

stations. Moreover, the relatively small fee for Auxiliary Broadcast

Stations already takes into account volunteer efforts, including those

described by SBE. Accordingly, we will retain a separate Auxiliary

Broadcast Station fee as proposed in the NPRM. See Appendix F,

Paragraph 27.

5. Intelsat and Inmarsat Signatory

37. In our NPRM, we proposed to establish a Signatory fee category

to recover our costs of regulating the U.S. Signatories to the

International Telecommunications Satellite Organization (Intelsat) and

to the International Mobile Satellite Organization (Inmarsat). See FY

1996 NPRM at para. 43. We stated that the new fee was warranted due to

the unique role of the U.S. Signatories in Intelsat's and Inmarsat's

structure and our regulatory role with respect to these entities. The

U.S. Signatory to Intelsat is the Communications Satellite Corporation

(Comsat), the entity designated, pursuant to the Communications

Satellite Act, as the sole operating entity to participate in Intelsat

in order to construct and operate the space segment of the global

commercial telecommunications satellite system established under the

Interim Agreement and Special Agreement signed by the Governments on

August 20, 1964. See 47 U.S.C. 731. Also, pursuant to the

Communications Satellite Act, Comsat is solely designated to

participate in the Inmarsat. See 47 U.S.C. 751. Because Comsat is the

entity that Congress

[[Page 36635]]

designated as the U.S. Signatory to both Intelsat and Inmarsat, the fee

would apply only to Comsat.

38. Comsat has opposed our adoption of the Signatory Fee,

contending that the proposed fee is unlawful and, even if lawful,

excessive. GE American Communication, Inc. (GE Americom) has filed

comments supporting our adoption of the Signatory fee and reply

comments responding to certain of Comsat's arguments.

39. Comsat believes that the Signatory fee is beyond our authority

in light of Congress' intention not to assess a fee upon space stations

operated by international organizations. See FY 1995 Report and Order

at para. 110. In addition, Comsat argues that we are authorized to

establish new fee categories only in those instances in which there has

been a change in our regulation or in the law. Comsat also claims that

the Signatory fee is prohibited by Article I, Section 8, Clause 1 of

the United States Constitution as an unauthorized and unconstitutional

tax because it bears no relationship to any specific regulatory benefit

that Comsat receives from the Commission. Instead, Comsat argues,

Congress alone conferred upon Comsat its ``special benefit'' of

Signatory status. Finally, Comsat maintains that, even assuming that we

have authority to establish a Signatory fee, the total amount to be

recovered by the fee is grossly excessive.

40. We reject Comsat's contention that the Signatory fee

contravenes Congressional intent reflected in Section 9. In the

Conference Report accompanying Section 9, Congress stated with respect

to space station fees that--

the Committee intends that fees in this category be assessed on

operations of U.S. facilities, consistent with U.S. jurisdiction.

Therefore, these fees will only apply to space stations directly

licensed by the Commission under Title III of the Communications

Act. Fees will not be applied to space stations operated by

international organizations subject to the International

Organizations Immunities Act, 22 U.S.C. Section 288 et seq.\12\

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\12\ See H.R. Rept. No. 213, 103d Cong., 1st Sess. 499 (1993);

see also H.R. Rep. No. 102-207, 102d Cong., 1st Sess. 26. Both

Intelsat and Inmarsat are subject to the International Organizations

Immunities Act. See Exec. Order No. 11,996, 42 Fed. Reg. 4331

(1977); Exec. Order No. 12,238, 45 Fed. Reg. 60,877 (1980).

In contrast to the space stations referred to in the Conference Report,

however, the Signatory fee will not be imposed on Intelsat and

Inmarsat, or on their operation of international space stations. The

fee applies only to Comsat, a private, for-profit, U.S. corporation

that receives benefits from its special role in international satellite

communications. Moreover, in contrast to Congress' rejection of a fee

on Intelsat's and Inmarsat's space stations as inconsistent with U.S.

jurisdiction, nothing in Section 9 limits our authority to recover our

costs of regulating Comsat, a U.S. Corporation.

41. Comsat is also mistaken that the second sentence in subsection

9(b)(3) limits our authority to establish new fee categories.

Specifically, subsection 9(b)(3) states that ``the Commission shall

add, delete, or reclassify services in the Schedule to reflect

additions, deletions, or changes in the nature of its services as a

consequence of Commission rulemaking proceedings or changes in law.''

47 U.S.C. 159(b)(3). The subsection provides that we must add new fees

to the Schedule to reflect changes in the nature of our services. The

statement does not purport to limit our statutory authority, and duty,

to otherwise modify fees as provided in Section 9.

42. In that regard, subsection 9(b)(3) requires that we ``amend the

Schedule of Regulatory Fees if the Commission determines that the

Schedule requires amendment to comply with the requirements of

paragraph (1)(A).'' Paragraph (1)(A), in turn, requires that we assess

and collect regulatory fees to cover the costs of regulatory

activities, including international activities, by ``tak[ing] into

account factors that are reasonably related to the benefits provided to

the payor of the fee by the Commission's activities and other factors

that the Commission determines are necessary in the public interest.''

47 U.S.C. 159(b)(1)(A). Thus, Section 9 both authorizes and requires

amendment of the Schedule when, as here, we determine that such action

is necessary to recover our regulatory costs for international

activities, taking into account the benefits that we provide the payor

and other public interest factors.

43. Further, we find no merit in Comsat's argument that our

proposed Signatory fee constitutes an unauthorized and unconstitutional

tax. Relying on National Cable Television Association v. United States,

(NCTA), Comsat claims that the fee is an unconstitutional tax, rather

than a fee, because it bears no relationship to any regulatory benefit

conferred by the Commission on Comsat as a signatory. Comsat also

asserts that Congress may not delegate the power to levy a tax. Comsat,

however, misstates the law concerning delegations of taxing authority.

In Skinner v. Mid-America Pipe Line Co., the Supreme Court made clear

that, even if agency fees are a form of taxation, the delegation of

discretionary authority under Congress' taxing power is subject to no

constitutional scrutiny greater than applied to other nondelegation

challenges. 490 U.S. 212, 224; 109 S.Ct. 1762, 1733 (1989). Thus, so

long as the fees in question are within the scope of Congress' lawful

delegation of authority in Section 9, they are constitutional. No

requirement exists to establish that all of the administrative costs

recovered through the signatory fee are not a tax in that they ``inure

directly to the benefit of regulated parties,'' rather than to the

public generally. Id. at 223-24.

44. Consistent with the Supreme Court's guidance in Skinner,

Congress in Section 9 of the Act declared that the fees are to be

assessed in a rulemaking proceeding, based upon our costs of performing

enforcement, policy and rulemaking, international and user information

activities, ``taking into account'' the benefits provided to the payor

of the fee by these activities, as well as other public interest

factors, and that we are to recover our costs only in the aggregate

amount annually appropriated by Congress.

45. We believe that the fee in question fully satisfies the

statutory requirements in Section 9. As noted in the NPRM, our review

of our Signatory activities disclosed that approximately 14.7% of the

costs attributable to space station regulatory oversight ($3,175,850)

\13\, as determined in Appendix C, is directly related to Intelsat and

Inmarsat Signatory activities (5.25 FTEs \14\ out of a total of 35.7

direct FTEs). As a result, $466,850 (rounded) must be collected from

the Signatories to offset the regulatory costs attributed to them

($3,175,850 x 14.7%). Dividing this revenue requirement by two (there

are Signatories to two separate organizations), yields a Signatory fee

of $233,425. See Appendix F, Paragraph 37. We also have no doubt that

Comsat benefits significantly from its status as signatory and the

regulatory oversight that is necessitated by that status.\15\

[[Page 36636]]

Therefore, taking into account these benefits, we perceive no public

interest basis for relieving Comsat of the costs that the Commission

incurs in regulating its activities.

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\13\ Revenue requirements have been adjusted throughout the

satellite fee categories as a result of adjustments to the

assessable payment units for some fee categories and the

Congressionally imposed fees for VHF and UHF television stations.

Therefore, the amounts will not match the amounts shown in the NPRM.

\14\ Full Time Equivalent (FTE) employment is the total number

of regular straight-time hours (i.e., not including overtime or

holiday hours) worked or to be worked by current and future

employees divided by the number of compensable hours applicable to

each fiscal year.

\15\ For example, we are currently conducting several

proceedings concerning Comsat's authority to provide services via

Intelsat and Inmarsat, its authority to participate in the

procurement or leasing of various Intelsat and Inmarsat space

stations, and its authority to participate in certain Intelsat and

Inmarsat-associated businesses. There also are proceedings pending

before us related to whether Comsat has conformed to applicable

structural and financial separation rules. In addition, we actively

participate on an ongoing basis with the Executive Branch in the

oversight of Comsat's representations of U.S. policy at the Intelsat

and Inmarsat governing boards through the U.S. Government

Instructional process.

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46. Since the Signatory fee will recover our costs attributable to

our Signatory oversight, we are able to reduce the space station fee.

The new space station fee is computed by reducing the revenue

requirement for space stations calculated in Appendix C ($3,175,850) by

the $466,850 to be collected from signatories and dividing the reduced

space station revenue requirement ($2,709,000) by the number of payment

units (38 operational space stations). The result of these calculations

is a new fee of $71,300 (rounded) for each operational space

station.\16\

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\16\ This fee is further adjusted in Paragraph 47.

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47. Finally, although we have imposed a Signatory fee in our FY

1996 Schedule of Regulatory Fees, we intend in FY 1997 to explore

alternative means of recovering these costs. We may, for example,

conclude that it is more efficient to recover these regulatory costs

through increases in the fees for international bearer circuits.

However, before making such changes, we will seek public comment in the

rulemaking proceeding to implement the FY 1997 Schedule of Regulatory

Fees.

6. Low Earth Orbit (LEO) Satellite Systems

48. In our NPRM, we proposed for the first time to adopt a fee for

Low Earth Orbit (LEO) Satellite Systems.\17\ In developing that fee, we

proposed to apportion the total revenue requirement for all space

stations between LEO systems and geosynchronous space station

licensees. In so doing, we also proposed to preserve the same relative

relationship between the fees established by the Congress in Section

9(g) of the Act for geosynchronous space stations and LEO systems;

i.e., an approximate 38.5% differential between the fee for LEO systems

and the fee for geosynchronous space stations. 47 U.S.C. 159(g). After

reducing the space station revenue requirement by the amount of the

Signatory fees, the resultant LEO fee is $97,725 (rounded) and the new

geosynchronous fee is $70,575 (rounded).\18\

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\17\ Congress' Schedule of Regulatory Fees contains a fee for

LEO systems. However, for FY 1994 and FY 1995, we determined that no

LEO systems were operational on the effective date of the fee

requirement for these years. See FY 1995 Report and Order at para.

15.

\18\ The FY 1996 adjusted revenue requirement for all space

stations has been determined to be $2,709,000. See Paragraph 46. For

FY 1996, there is only one LEO system, and there are 37

geosynchronous (including DBS) space stations subject to fee

payment. The formula for computing the new LEO and geosynchronous

space station fees is as follows:

(a) We have assigned ``L'' to represent the LEO system fee and

``G'' to represent geosynchronous space station fee.

(b) The relationship between the LEO fee and the geosynchronous

fee may be expressed as:

L=1.385G (i.e., the LEO fee needs to be 38.5% higher than the

corresponding geosynchronous space station fee).

(c) The total revenue to be collected from LEOs and

geosynchronous space stations may be expressed as:

L+37G=$2,709,000 (i.e., the one existing LEO system and 37

geosynchronous space stations together must account for $2,709,000

in revenues).

(d) Substituting the value of ``L'' in (b) above into the

formula in (c) above yields the following:

1.385G+37G=$2,709,000

38.385G=$2,709,000

G=$470,574

(e) Therefore, ``G'' (Geosynchronous space station fee) is

$70,575 (rounded).

(f) Substituting the computed value of ``G'' in (d) above into

the formula in (c) above yields the following:

L+37(70,575)=2,709,000

L+2,611,275=2,709,000

L=97,725

(g) Therefore, ``L'' (LEO fee) is $97,725.

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49. Motorola requests that we defer imposing any regulatory fee on

a LEO system until an entire planned constellation has been launched

and is fully operational. In our FY 1994 Report and Order, we decided

that a LEO system would become subject to a fee payment when its first

satellite became operational upon certification by its licensee that

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

terms and conditions of its authorization pursuant to 47 CFR

Sec. 25.120(d). Nothing in Motorola's comments persuades us otherwise.

It may take several years for an entire constellation to be completed.

However, a system is capable of providing commercial customer services

prior to full deployment of all authorized satellites. Thus, because

our regulatory oversight of a LEO system begins when its initial

satellite is launched and placed in operation, we will require that a

LEO system licensee submit a fee once it certifies to the operation of

its initial satellite pursuant to Section 25.120(d) of our rules.

7. Minimum Fee Payment Liability

50. As proposed in our NPRM at para. 57, we will adopt a minimum

fee payment policy in order to minimize the cost of our regulatory fee

program because our collection and verification costs for small

payments are considerably more than our revenues from these

collections. A regulatee will be relieved of its fee payment

requirement if its total fee due, including all categories of fees for

which payment is due by the entity, amounts to less than $10. We have

reconsidered our proposal to submit the Form FCC 159 and have

determined that we will not require those entities qualifying for the

minimum fee liability exemption to file Form FCC 159. Those qualifying

for exemption, however, are advised that as part of our verification

program, it may be necessary for them to provide proof of exemption

should we choose to audit their fee liability.

F. Additional Regulatory Fee Issues

1. Cable Television Systems

51. The National Cable Television Association (NCTA) has filed

comments objecting to our proposed fee for cable television systems.

NCTA asserts that we failed to discuss in our NPRM the basis for our

proposed fee and that we did not demonstrate that the fee is reasonably

related to our costs of regulating cable television. NCTA also believes

that with deregulation, the fee for cable television should decrease

rather than increase, particularly in light of our ``social contract''

resolution of rate complaints, ongoing deregulation of small cable

systems and its expectation of further rate deregulation. Further, NCTA

contends that the cable television per subscriber fee should not be set

as high relative to the proposed fee for Wireless Cable (MMDS)

licensees.

52. In our NPRM, we discussed in detail our methodology for

developing our proposed fees for FY 1996, including our cable

television fees. See NPRM at Paras. 8-12 and Appendix C. Therein, we

set forth both our steps used to develop the fees and our mathematical

calculations underlying the development of specific fee proposals. We

also explained that, for various reasons, our cost accounting system

was not yet able to provide reliable information to assist us in

developing our fees. See NPRM at paras. 13-17. Thus, for FY 1996, we

were unable to compare the individual fee category revenues with actual

data accumulated from our new cost accounting system.

53. Even though we were not able to use our new cost accounting

system, we

[[Page 36637]]

believe the fees for cable systems are reasonably related to our costs

attributable to cable television regulation which consist of several

different categories of costs. Direct staff costs are those costs

attributable to staff assigned to the Cable Services Bureau engaged in

activities described in Section 9(a)(1) of the Act. Indirect or

overhead support staff costs are those costs attributable to staff

assigned to other Bureaus and Offices within the Commission who support

direct staff working in the Cable Services Bureau. Support staff

accounts for approximately 40% of staff costs attributable to cable

television oversight. Other obligations costs are non-personnel costs

such as office space rental, equipment, contractual services, supplies,

etc. which are attributable to the Cable Services Bureau. In total,

these costs have not changed significantly from FY 1995.

54. Additionally, we must recover from our regulatory fees other

costs that cannot be specifically attributed to a particular class of

licensee. These costs, in the interest of fairness, are allocated on a

pro-rata basis to all fee payors. For example, Congress has exempted

several classes of licensees from regulatory fees, including amateur

radio licensees, non-commercial radio and television stations, non-

profit entities and public safety licensees. Although these entities

are exempt from payment of a fee, Congress requires that our regulatory

costs associated with these entities be borne by those regulatees not

exempt from the fee requirement. Additionally, in making the mandatory

adjustments to the fee amounts required by Section 9(b)(2)(a), an

overall revenue shortfall occurs due to changes in the number of

payment units from FY 1995 to FY 1996. This shortfall (over $1 million)

is allocated on a pro rata basis to all fee categories, including cable

television system operators.

55. Also, we disagree with NCTA's contention that our regulatory

costs related to cable television systems should be lower at this stage

of the industry's deregulation. Based on the foregoing, our costs

attributable to the regulatory categories for which we are required to

recover our costs through regulatory fees are actually much higher than

they may appear due to overhead and indirect costs. Second, although we

are deregulating the cable television industry, our regulatory costs

related to cable television have not diminished for FY 1996. Since the

Telecommunications Act of 1996 became law, we have commenced several

important rulemaking proceedings to further our cable deregulatory

policies, requiring significant personnel resources. In addition,

because of the large volume of work required of the Commission under

the 1996 Act, the Cable Bureau has taken on significant new

responsibilities in a number of areas related to the provision of video

programming services. For example, the Bureau is responsible for

developing and enforcing rules concerning open video systems pursuant

to new section 653 of the Communications Act, over-the-air reception

devices under section 207 of the 1996 Act and telecommunications

navigation devices under new section 629. And the Bureau has been

assigned the responsibility to implement the amendments to section 224

(Regulation of Pole Attachments) of the Communications Act of 1934, as

well as new section 713 of the Communications Act concerning video

programming accessibility. These proceedings (whose costs must be

offset by regulatory fees) are in addition to our on-going oversight

responsibilities involving rate complaints, program access complaints,

informational services, and adjudicatory proceedings work, which must

continue even as we implement the Telecommunications Act. Thus, while

we agree with NCTA that our ``social contracts'' with cable operators

and the deregulation of small cable operators and similar policy

initiatives reduce certain costs of regulation, we cannot conclude that

our overall costs of cable regulation or those additional regulatory

costs that we must recover from cable operators justify a reduction in

the cable television fee for FY 1996.

56. Finally, we reject NCTA's complaint that the cable subscriber

fee is too high relative to the regulatory fees paid by Wireless Cable

(MMDS) licensees. NCTA estimates that MMDS fees would be $.20 per

subscriber if its fee were assessed on a per subscriber basis rather

than a call sign basis. As NCTA is aware, cable and MMDS are subject to

substantially different regulatory oversight programs. As a consequence

of our oversight of these services, our estimated total cost to

regulate the cable television industry in FY 1996 is $31 million as

opposed to an estimated total cost to regulate MMDS entities in FY 1996

of $158,000. In view of these estimated costs, in large part due to

their different regulatory regimes, we see no unreasonable disparity

between the revenue requirement that we have assigned to the two

services. NCTA should note that MMDS regulatory fees have increased

nearly twice as much as cable television fees since Congress

established its Schedule of Regulatory Fees in 1993. See 47 U.S.C.

159(g).

57. In summary, we expect that our deregulatory activities will

result in reduced oversight costs in future years, but those costs have

not and will not diminish for FY 1996. Thus, for FY 1996, we will adopt

the cable television fee shown in Appendix D.

2. International Bearer Circuits

58. International Bearer Circuit fees are assessed upon facilities-

based common carriers activating a circuit in any transmission facility

for the provision of service to an end user or a resale carrier. In our

NPRM, we proposed a fee of $4.00 per bearer circuit upon facilities-

based common carriers activating a circuit in any transmission facility

for the provision of service to an end user or a resale carrier.

59. Comsat contends that our proposed fee for international bearer

circuits is approximately twice the appropriate fee amount necessary to

recover the revenue requirement that we assigned to this fee category.

Comsat states that the revenue requirement associated with bearer

circuits has increased significantly in one year without any

explanation. In Comsat's view, the increase in the revenue requirement

for bearer circuits arises from underforecasting payment units in FY

1995 and the use of actual payment units as the basis for our FY 1996

forecast. Comsat states that, since there is no evidence that the costs

which the bearer circuit fee is designed to recover have increased, our

proposed retention of the $4.00 per circuit fee, based on our

underestimate of bearer circuit payment units for FY 1995, is

unjustified.

60. The Commission, in its FY 1995 NPRM, estimated that there were

62,000 international bearer circuits susceptible to regulatory fee

payment (based on estimated counts as of December 1994). As a result of

comments received from interested parties in that rulemaking, we more

than doubled (to 125,000) the number of estimated circuits applicable

to our development of FY 1995 regulatory fees in our FY 1995 Report and

Order. Based on actual numbers of bearer circuits for which fee

payments were made in FY 1995, we proposed in our FY 1996 NPRM a total

of 228,000 circuits for FY 1996 (based on estimated counts as of

December 31, 1995).

61. The Commission knows of no reliable source of bearer circuit

counts. We do not maintain this data at the Commission nor do we know

of any central repository of this information. As such, we must rely on

industry estimates or actual prior year payment information in order to

determine the

[[Page 36638]]

number of payment units for any particular fiscal year. The payment

unit estimate for FY 1995 was based on the best information available

to us and relied upon information provided by regulatees. The same is

true for FY 1996. Although Comsat questions our estimate of payment

units for FY 1996, it did not provide its own estimate of circuits, nor

did any other commentor. As such, we believe our FY 1996 payment unit

estimate based on actual circuits paid for in FY 1995 is appropriate.

62. Comsat's concerns relative to the total revenues being

collected from bearer circuits are not persuasive. The methodology for

calculating regulatory fees established by the Congress requires that

prior year fee amounts be proportionally adjusted in order to ensure

that the total amount to be collected is apportioned fairly among our

regulatees. The Congress also provided that further adjustments to the

fees (``permitted amendments'') should be supported by costs derived

from our cost accounting system. As noted elsewhere in this item, we

were unable to utilize cost data from our new cost accounting system

this year and were therefore unable to determine the total costs

attributable to bearer circuit regulation and to compare this to our

estimate of revenue requirements. This data should be available for

development of our FY 1997 regulatory fees. In the absence of reliable

cost accounting information, we performed an informal review of bearer

circuit costs and found that our costs may significantly exceed the

revenue requirement for bearer circuits established in this rulemaking.

Estimated staff resources devoted to bearer circuit oversight also seem

to support a higher revenue requirement. As such, we believe that our

revenue requirement and estimated payment units are based on the most

accurate information available, and we will utilize these estimates for

FY 1996.

63. In addition, Comsat states that our estimated unit count for

bearer circuits may also be low because we failed to consider that we

recently authorized domestic satellites to provide international bearer

circuits. See FCC 96-14 (released Jan. 22, 1996), summary published 61

FR 9946 (Mar. 12, 1996), 11 FCC Rcd 2429, (DISCO-I Order). Also, Comsat

contends that our definition of bearer circuits should include all

bearer circuits, not only those provided by common carriers, because

the statutory fee schedule contemplates that the bearer circuit fee

will be collected from common and private carriers alike.

64. Nothing in Section 9 of our implementing rules limits payment

of international bearer circuit fees to international common carriers.

Therefore, any common carrier, including domestic satellite licensees

providing international bearer circuits, as described in our FY 1995

Report and Order at paras. 115 through 117, is subject to the bearer

circuit fee. However, because our DISCO-I Order did not become

effective until after the calculation date for bearer circuits (October

1, 1995), domestic satellite licensees were not authorized to provide

international bearer circuits at the time for calculating the bearer

circuit regulatory fee, and, therefore, we have not included bearer

circuits provided by domestic satellite carriers in our estimates of

bearer circuit payment units for FY 1996.

65. Finally, Comsat contends that Section 9 provides for the

payment of a bearer circuit fee by private carriers. However, our NPRM,

as well as prior year NPRMs, did not propose to collect international

bearer circuit fees from other than common carriers. We do not have any

information in the record of this proceeding on which to calculate a

fee applicable to bearer circuits provided directly to end users over

non-common carrier international facilities. As a result, we have no

other viable alternative but to adopt the fee as proposed in the NPRM.

However, we believe that Comsat's proposal warrants further

consideration. It is our intention to consider Comsat's proposal, or

some modification thereof, for assessment of the FY 1997 fees.

3. National Exchange Carrier Association (NECA)

66. NECA has requested by comments in this proceeding that we amend

our rules governing confidentiality of information NECA receives in its

role as administrator of the Telecommunications Relay Service (TRS)

Fund to permit it to use TRS data for the sole additional purpose of

aggregating regulatory fees from local exchange carriers (LECs) in

accordance with our requirements for assessment of their fees.\19\ See

47 CFR Sec. 64.604(c)(4)(iii)(I). There were no other comments filed

addressing NECA's proposal.

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\19\ NECA is a not-for-profit, membership association,

consisting of all local exchange carriers in the United States,

Puerto Rico, the U.S. Virgin Islands and Micronesia. NECA is

responsible, under Subpart G of our Rules, for preparation of access

charge tariffs on behalf of all local telephone companies that do

not file separate tariffs, collection and distribution of access

charge revenues, administration of the Universal Service and

Lifeline Assistance programs, and the administration of the TRS

fund. See 47 CFR Sec. 69.603 and Sec. 64.604.

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

67. Currently, our rules prohibit NECA from using the TRS data it

collects for any purpose other than administration of the TRS fund. See

47 CFR 64.604(c)(4)(iii)(I). Because our assessment of regulatory fees

from LECs and other common carriers is modeled in large part upon the

methodology that we adopted for contributions by these carriers to the

TRS fund, we believe that a specific limited modification of the rule

governing NECA's use of TRS information would increase NECA's

efficiency in determining the appropriate regulatory fee due from any

carrier that avails itself of NECA's services in paying its regulatory

fee. Thus, we will amend our rules to permit NECA to use TRS

information for determining a carrier's fee. Section

64.604(c)(4)(iii)(i) will be amended to state that NECA may also use

TRS information ``to calculate the regulatory fees of interstate common

carriers and to aggregate their fee payments for submission to the

Commission.''

4. Mobile Satellite Service (MSS)

68. Motorola Satellite Communications, Inc's. (``Motorola'') has

requested clarification that hand-held transmit and transmit/receive

units used in the mobile satellite service (MSS) are within the

category of MSS ``blanket'' earth station licenses subject to a single

fee for all authorized units on one license. We have incorporated

language in Appendix F that MSS ``blanket'' earth station licenses

include hand-held transmit and transmit/receive units as well as

vehicle-based transceivers and are, therefore, subject to a fee

payment.

G. Procedures for Payment of Regulatory Fees

69. Section 9(f) requires that we permit ``payment by installments

in the case of fees in large amounts, and in the case of small amounts,

shall require the payment of the fee in advance for a number of years

not to exceed the term of the license held by the payor.'' See 47

U.S.C. Sec. 159(f)(1). Consistent with the section, we are again

establishing three categories of fee payments, based upon the category

of service for which the fee payment is due and the amount of the fee.

In general, we are retaining the procedures that we have established

for the payment of regulatory fees.

1. Annual Payments of Standard Fees

70. Standard fees are those regulatory fees that are payable in

full on an annual basis. Payers of standard fees are not required to

make advance payments

[[Page 36639]]

for their full license term and are not eligible for installment

payments. All standard fees are payable in full on the date we

establish for payment of fees in their regulatory fee category.

71. The payment due date for standard fees will be announced by

Public Notice in the Federal Register following Congressional

notification. For licensees, permittees and holders of various

authorizations in the Common Carrier, Mass Media, International, and

Cable Television Services whose fees are not based on a subscriber,

unit, or circuit count, liability for fee payment is established for

any authorization held as of October 1, 1995, the first day of FY 1996.

However, the licensee, permittee, or other regulatee at the time a fee

payment is due is the individual or entity legally liable for the fee

payment.

72. In the case of regulatees whose fees are based upon a

subscriber, unit, or circuit count, the number of a regulatee's

subscribers or circuits on December 31, 1995, will be used to calculate

the fee payment.\20\ As noted in the preceding paragraph, the licensee,

permittee, or other regulatee at the time a fee payment is due is

legally liable for the fee payment.

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

\20\ Cable systems have been calculating their regulatory fees

using subscriber data submitted to the Commission in their Annual

Report of Cable Television Systems (Form FCC 325). Consistent with

this methodology, we ask that cable system operators compute their

subscribers as follows: Number of single family dwellings + number

of individual households in multiple dwelling unit (apartments,

condominiums, mobile home parks, etc.) paying at the basic

subscriber rate + bulk rate customers + courtesy and free service.

Note: Bulk-Rate Customers = Total annual bulk-rate charge divided by

basic annual subscription rate for individual households.

Accordingly, the number of cable subscribers will not necessarily be

based on a count as of December 31, 1995, but rather on ``a typical

day in the last full week'' of December 1995.

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

2. Installment Payments for Large Fees

73. There will be insufficient time following the effective date of

our FY 1996 Schedule of Regulatory Fees to permit implementation of an

installment payment program for large fees. All entities who would

otherwise have been eligible for installments, i.e., whose fee

liability exceeds our previously established level of $12,000, must

submit their fee payments on the date we will announce by Public Notice

in the Federal Register.

3. Advance Payments of Small Fees

74. As we have in the past, we are treating regulatory fee payments

by certain licensees as small fees subject to advance payments. Advance

payments will be required from licensees of those services that have

been required to make advance payments in the past.\21\ Payers of

advance fees are required to submit the entire regulatory fee for the

full term of their license when filing their initial, renewal or

reinstatement application. Regulatees subject to a payment of small

fees shall pay the amount due for the current fiscal year multiplied by

the number of years in the term of their requested license. In the

event that the regulatory fee is adjusted following payment of the fee,

the new fee will not become effective until the expiration of the

licensing term. Thus, payment for the full license term would be made

based upon the regulatory fee applicable at the time the application is

filed. The effective date for the payment of all small fees pursuant to

the FY 1996 Schedule will be announced by Public Notice in the Federal

Register following Congressional notification.

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

\21\ Applicants for new, renewal and reinstatement licenses in

the following services are required to pay their regulatory fees in

advance: Land Mobile Services, Microwave Services, Interactive Video

Data Services (IVDS), Marine (Ship) Service, Marine (Coast) Service,

Private Land Mobile (Other) Services, Aviation (Aircraft) Service,

Aviation (Ground) Service, General Mobile Radio Service (GMRS). In

addition, applicants for Amateur Radio vanity call signs are

required to submit an advance payment.

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

H. Schedule of Regulatory Fees

75. The Commission's Schedule of Regulatory Fees for FY 1996 is

contained in Appendix D of this Report and Order.

IV. Ordering Clause

76. Accordingly, it is ordered that the rule changes as specified

herein are adopted. It is further ordered that the rule changes made

herein will become effective September 10, 1996, except that changes to

the Schedule of Regulatory Fees, made pursuant to Section 9(b)(3) of

the Communications Act, and incorporating regulatory fees for CMRS

Mobile Services, CMRS One-Way Paging, Geosynchronous Space Stations,

Intelsat and Inmarsat Signatories, and Low Earth Orbit Satellite

Systems, will become effective 90 days from notification to Congress.

However, it should be noted that for the CMRS Mobile Services,

licensees who did not elect to convert their stations from private to

commercial status prior to December 31, 1995, will not be subject to

payment of a regulatory fee for FY 1996. Therefore, for stations

licensed as commercial on or before the date of determination of fee

liability the fee will become effective September 10, 1996. See para.

17-22 supra. As noted above, the date payment of the regulatory fee is

due will be announced by Public Notice in the Federal Register.

V. Authority and Further Information

77. Authority for this proceeding is contained in Sections 4 (i)

and (j), 9, and 303(r) of the Communications Act of 1934, as amended,

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

78. Further information about this proceeding may be obtained by

contacting the Fees Hotline at (202) 418-0192.

List of Subjects

47 CFR Part 1

Administrative practice and procedure, Communications common

carriers, Federal Communications Commission, Radio, Telecommunications,

Television.

47 CFR Part 64

Communications common carriers, Federal Communications Commission,

Radio, Telegraph, Telephone.

Federal Communications Commission.

William F. Caton,

Acting Secretary.

Rule Changes

Parts 1 and 64 of Chapter I of Title 47 of the Code of Federal

Regulations are amended as follows:

PART 1--PRACTICE AND PROCEDURE

1. The authority citation for Part 1 continues to read as follows:

Authority: Sec. 5, 48 Stat. 1068, as amended; 47 U.S.C. 155,

225, unless otherwise noted.

2. Section 1.1152 is revised to read as follows:

Sec. 1.1152 Schedule of annual regulatory fees and filing locations

for wireless radio services.

[[Page 36640]]

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

Exclusive use services (per license) Fee amount Address

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

1. Land Mobile (Above 470 MHz, Base

Station & SMRS)(47 CFR, Part 90)

(a) 800 MHz New, Renewal, Reinstatement $7.00 FCC, 800 MHz, P.O. Box 358235, Pittsburgh, PA 15251-5235.

(FCC 574).

(b) 900 MHz New, Renewal, Reinstatement 7.00 FCC, 900 MHz, P.O. Box 358240, Pittsburgh, PA 15251-5240.

(FCC 574).

(c) 470-512,800,900, 220 MHz, 220 MHz 7.00 FCC, 470-512, P.O. Box 358245, Pittsburgh, PA 15251-5245.

Nationwide Renewal (FCC 574R, FCC 405A).

(d) Correspondence Blanket Renewal (470- 7.00 FCC, Corres., P.O. Box 358305, Pittsburgh, PA 15251-5305.

512,800,900,220 MHz) (Remittance

Advice, Correspondence).

(e) 220 MHz New, Renewal, Reinstatement 7.00 FCC, 220 MHz, P.O. Box 358360, Pittsburgh, PA 15251-5360.

(FCC 574).

(f) 470-512 MHz New, Renewal, 7.00 FCC, 470-512, P.O. Box 358810, Pittsburgh, PA 15251-5810.

Reinstatement (FCC 574).

(g) 220 MHz Nationwide New, Renewal, 7.00 FCC, Nationwide, P.O. Box 358820, Pittsburgh, PA 15251-

Reinstatement (FCC 574). 5820.

2. Microwave (47 CFR Part 101)

(a) Microwave New, Renewal, 7.00 FCC, Microwave, P.O. Box 358250, Pittsburgh, PA 15251-

Reinstatement (FCC 402). 5250.

(b) Microwave Renewal (FCC 402R)........ 7.00 FCC, Microwave, P.O. Box 358255, Pittsburgh, PA 15251-

5255.

(c) Correspondence Blanket Renewal 7.00 FCC, Corres., P.O. Box 358305, Pittsburgh, PA 15251-5305.

(Microwave) (Remittance Advice,

Correspondence).

3. Interactive Video Data Service

(a) IVDS Renewal (FCC 574R, FCC 405A)... 7.00 FCC, IVDS, P.O. Box 358245, Pittsburgh, PA 15251-5245.

(b) Correspondence Blanket Renewal 7.00 FCC, Corres., P.O. Box 358305, Pittsburgh, PA 15251-5305.

(IVDS) (Remittance Advice,

Correspondence).

(c) IVDS New, Renewal, Reinstatement 7.00 FCC, IVDS, P.O. Box 358365, Pittsburgh, PA 15251-5365.

(FCC 574).

4. Shared Use Services

(a) Land Transportation (LT) New, 3.00 FCC, Land Trans., P.O. Box 358215, Pittsburgh, PA 15251-

Renewal, Reinstatement (FCC 574). 5215.

(b) Business (Bus.) New, Renewal, 3.00 FCC, Business, P.O. Box 358220, Pittsburgh, PA 15251-

Reinstatement (FCC 574). 5220.

(c) Other Industrial (OI) New, Renewal, 3.00 FCC, Other Indus., P.O. Box 358225, Pittsburgh, PA 15251-

Reinstatement (FCC 574). 5225.

(d) General Mobile Radio Service (GMRS) 3.00 FCC, GMRS, P.O. Box 358230, Pittsburgh, PA 15251-5230.

New, Renewal, Reinstatement (FCC 574).

(e) Business, Other Industrial, Land 3.00 FCC, Bus., OI, LT, GMRS, P.O. Box 358245, Pittsburgh, PA

Transportation, GMRS Renewal (FCC 574R, 15251-5245.

FCC 405A).

(f) Ground New, Renewal, Reinstatement 3.00 FCC, Ground, P.O. Box 358260, Pittsburgh, PA 15251-5260.

(FCC 406).

(g) Coast New, Renewal, Reinstatement 3.00 FCC, Coast, P.O. Box 358265, Pittsburgh, PA 15251-5265.

(FCC 503).

(h) Ground Renewal (FCC 452R)........... 3.00 FCC, Ground, P.O. Box 358270, Pittsburgh, PA 15251-5270.

(i) Coast Renewal (FCC 452R)............ 3.00 FCC, Coast, P.O. Box 358270, Pittsburgh, PA 15251-5270.

(j) Ship New, Renewal, Reinstatement 3.00 FCC, Ship, P.O. Box 358275, Pittsburgh, PA 15251-5275.

(FCC 506).

(k) Aircraft New, Renewal, Reinstatement 3.00 FCC, Aircraft, P.O. Box 358280, Pittsburgh, PA 15251-

(FCC 404). 5280.

(l) Ship Renewal (FCC 405B)............. 3.00 FCC, Ship, P.O. Box 358290, Pittsburgh, PA 15251-5290.

(m) Aircraft Renewal (FCC 405B)......... 3.00 FCC, Aircraft, P.O. Box 358290, Pittsburgh, PA 15251-

5290.

(n) Correspondence Blanket Renewal 3.00 FCC, Corres., P.O. Box 358305, Pittsburgh, PA 15251-5305.

(Bus., OI, LT, GMRS) (Remittance

Advice, Correspondence).

(o) Correspondence Blanket Renewal 3.00 FCC, Corres., P.O. Box 358305, Pittsburgh, PA 15251-5305.

(Ground) (Remittance Advice,

Correspondence).

(p) Correspondence Blanket Renewal 3.00 FCC, Corres., P.O. Box 358305, Pittsburgh, PA 15251-5305.

(Coast) (Remittance Advice,

Correspondence).

(q) Correspondence Blanket Renewal 3.00 FCC, Corres., P.O. Box 358305, Pittsburgh, PA 15251-5305.

(Aircraft) (Remittance Advice,

Correspondence).

(r) Correspondence Blanket Renewal 3.00 FCC, Corres., P.O. Box 358305, Pittsburgh, PA 15251-5305.

(Ship) (Remittance Advice,

Correspondence).

5. Amateur Vanity Call Signs............ 3.00 FCC, Amateur Vanity, P.O. Box 358924, Pittsburgh, PA

15251-5924.

6. CMRS Mobile Services (per unit)...... .17 FCC, Cellular, P.O. Box 358835, Pittsburgh, PA 15251-

5835.

[[Page 36641]]

7. CMRS One-Way Paging (per unit)....... .02 FCC, Paging, P.O. Box 358835, Pittsburgh, PA 15251-5835.

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

3. Sec. 1.1153 is revised to read as follows:

Sec. 1.1153 Schedule of annual regulatory fees and filing locations

for mass media services.

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

Fee amount Address

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

AM Radio (47 CFR, Part 73)

1. Class D Daytime...................... $345 FCC, AM Branch, P.O. Box 358835, Pittsburgh, PA, 15251-

5835.

2. Class A Fulltime..................... 1,250

3. Class B Fulltime..................... 690

4. Class C Fulltime..................... 280

5. Construction Permits................. 140

FM Radio (47 CFR, Part 73)

1. Classes C,C1,C2,B.................... $1,250 FCC, FM Branch, P.O. Box 358835, Pittsburgh, PA.

2. Classes A,B1,C3...................... 830

3. Construction Permits................. 690

TV (47 CFR, Part 73) VHF Commercial

1. Markets 1 thru 10.................... $32,000 FCC, TV Branch, P.O. Box 358835, Pittsburgh, PA, 15251-

5835.

2. Markets 11 thru 25................... 26,000

3. Markets 26 thru 50................... 17,000

4. Markets 51 thru 100.................. 9,000

5. Remaining Markets.................... 2,500

6. Construction Permits................. 5,550

UHF Commercial

1. Markets 1 thru 10.................... $25,000 FCC, UHF Commercial, P.O. Box 358835, Pittsburgh, PA,

15251-5835.

2. Markets 11 thru 25................... 20,000

3. Markets 26 thru 50................... 13,000

4. Markets 51 thru 100.................. 7,000

5. Remaining Markets.................... 2,000

6. Construction Permits................. 4,425

Satellite UHF/VHF Commercial

1. All Markets.......................... $690 FCC Satellite TV, P.O. Box 358835, Pittsburgh, PA, 15251-

5835

2. Construction Permits................. 250

Low Power TV, TV/FM Translator, & TV/FM $190 FCC, Low Power, P.O. Box 358835, Pittsburgh, PA, 15251-

Booster (47 CFR, Part 74). 5835.

Broadcast Auxiliary..................... 35 FCC, Auxiliary, P.O. Box 358835, Pittsburgh, PA, 15251-

5835.

Multipoint Distribution................. 155 FCC, Multipoint, P.O. Box 358835, Pittsburgh, PA, 15251-

5835.

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

4. Sec. 1.1154 is revised to read as follows:

Sec. 1.1154 Schedule of annual regulatory charges and filing locations

for common carrier services.

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

Fee amount Address

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

Radio Facilities

1. Domestic Public Fixed................ $155 FCC, Dom. Pub. Fixed, P.O. Box 358835, Pittsburgh, PA,

15251-5835.

Carriers

1. Interstate Telephone Service .00098 FCC, Carriers, P.O. Box 358835, Pittsburgh, PA.

Providers (per dollar contributed to

TRS Fund).

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

5. Sec. 1.1155 is revised to read as follows:

Sec. 1.1155 Schedule of regulatory fees and filing locations for cable

television services.

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

Fee amount Address

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

1. Cable Antenna Relay Service.......... $325 FCC, Cable,

[[Page 36642]]

2. Cable TV System (per subscriber)..... .55 P.O. Box 358835, Pittsburgh, PA, 15251-5835.

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

6. Section 1.1156 is revised to read as follows:

Sec. 1.1156 Schedule of regulatory fees and filing locations for

international services.

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

Fee amount Address

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

Radio Facilities

1. International (HF):

Broadcast........................... $280 FCC, International, P.O. Box 358835, Pittsburgh, PA,

15251-5835.

2. International Public:

Fixed............................... 225 FCC, International, P.O. Box 358835, Pittsburgh, PA,

15251-5835.

Space Stations (Geosynchronous Orbit)... 70,575 FCC, Space Stations, P.O. Box 358835, Pittsburgh, PA,

15251-5835.

Low Earth Orbit Satellite............... 97,725 FCC, Space Stations, P.O. Box 358835, Pittsburgh, PA,

15251-5835.

INMARSAT/INTELSAT Signatory............. 233,425 FCC, Space Stations, P.O. Box 358835, Pittsburgh, PA,

15251-5835.

Earth Stations:

Transmit/Receive & Transmit Only 370 FCC, Earth Station, P.O. Box 358835, Pittsburgh, PA,

(per authorization or registration). 15251-5835.

Carriers:

1. International Circuits (per active 4.00 FCC, International, P.O. Box 358835, Pittsburgh, PA,

64KB circuit or equivalent) 15251-5835.

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

PART 64--MISCELLANEOUS RULES RELATING TO COMMON CARRIERS

1. The authority citation for Part 64 continues to read as follows:

Authority: Sections 4, 48 Stat. 1066, as amended; 47 U.S.C. 154,

unless otherwise noted. Interpret or apply Sections 201, 218, 226,

228, 48 Stat. 1070, as amended, 1077; 47 U.S.C. 201, 218, 226, 228,

unless otherwise noted.

2. Section 64.604(c)(4)(iii)(I) is revised to read as follows:

Sec. 64.604 Mandatory minimum standards.

* * * * *

(c) * * *

(4) * * *

(iii) * * *

(I) Information filed with the administrator. The administrator

shall keep all data obtained from contributors and TRS providers

confidential and shall not disclose such data in company-specific form

unless directed to do so by the Commission. The administrator shall not

use such data except for purposes of administering the TRS Fund,

calculating the regulatory fees of interstate common carriers, and

aggregating such fee payments for submission to the Commission. The

Commission shall have access to all data reported to the administrator,

and authority to audit TRS providers.

* * * * *

Appendix A--Final Regulatory Flexibility Analysis

[This Appendix A will not be published in the Code of Federal

Regulations.]

Final Analysis of the Report and Order

1. As required by Section 603 of the Regulatory Flexibility Act,

5 U.S.C. 603, an Initial Regulatory Flexibility Analysis (IRFA) was

provided in the Notice of Proposed Rulemaking (NPRM). The Commission

sought written public comments on the proposals in the NPRM,

including the IRFA.

2. Need for and Objective of the Report and Order: Congress has

directed the Commission to collect $126,400,000 in regulatory fees

for fiscal year (FY) 1996. The Commission, pursuant to 47 U.S.C.

159, is modifying its Schedule of Regulatory Fees in order to comply

with the Congressional directive.

3. Summary of Significant Issues Raised by the Public in

response to the IRFA: No comments were submitted in response to the

IRFA.

4. Description and Estimate of Number of Small Businesses to

Which the Modifications of the Schedule of Fees Will Apply: The

Regulatory Flexibility Act generally defines the term ``small

business'' as having the same meaning as the term ``small business

concern'' under the Small Business Act, 15 U.S.C. Sec. 632. A small

business concern is one which (1) is independently owned and

operated; (2) is not dominant in its field of operations; and

satisfies additional criteria established by the Small Business

Administration (SBA). Id. According to the SBA's regulations,

entities engaged in the provision of communications services may

have maximum revenues of $11 million in order to qualify as a small

business concern. 13 CFR Sec. 121.201. Therefore, this standard also

applies in determining whether an entity is a small business for

purposes of the Regulatory Flexibility Act.

5. The Report and Order creates a Commercial Mobile Radio

Services (CMRS) category of fees which replaces the Cellular/Public

Mobile category in our FY 1995 Schedule of Regulatory Fees. Creation

of the new category does not affect any fees payable by licensees

nor the manner in which these fees are paid. Cellular and Public

Mobile Service licensees representing an estimated 30 million

assessable units will continue to pay an annual fee as they have in

the past. Business Radio, Special Mobile Radio Services and 220-222

Land Mobile Systems, which are regulated under Part 90 of the Rules,

and Public Coast Stations, which are regulated under Part 80,

currently pay small fees in advance for the full period of their

license terms, when filing their initial, reinstatement or renewal

application. Certain of these licensees may now elect to become CMRS

licensees. However, they are not required to make that choice before

August 10, 1996. When and if they do, those licensees which have

converted from the Private Mobile Radio Services (PMRS) to CMRS will

be required to pay annual regulatory fees predicated on the number

of units they have in service. Based on survey responses from

licensees, we estimate that roughly 120,000 stations will be

eligible for conversion from PMRS to CMRS. Although we know that

many entities hold licenses for

[[Page 36643]]

multiple stations and not all licensees are small entities, we

estimate the number of small entities that will be affected in the

future to be approximately 20,000. However, because these

conversions will not occur until the end of FY 1996 and were not

effective on our established date for fee liability, no annual fee

is being imposed on them for FY 1996.

6. With certain exceptions not relevant here, the Commission's

Regulatory Fee Schedule applies to all Commission licensee and

regulatees. The only other changes in the fee schedule, consist of

adjustments in the assessments for various entities necessitated by

the Congressionally mandated increase in the amount of fees to be

recovered and new fees for Low Earth Orbit Satellite Systems, and

Intelsat and Inmarsat Signatory Fees. There is only one Low Earth

Orbit System, and Comsat is the sole Intelsat and Inmarsat

Signatory. They are dominant carriers. Thus, we certify that these

new fees are not subject to the Regulatory Flexibility Act of 1980,

as amended, because they do not apply to small entities as defined

by Section 601(3) of the Regulatory Flexibility Act. We further

certify that the changes in the amounts of the other regulatory fees

to be collected are not subject to the Act because they are

relatively small and not likely to have a significant economic

impact on a substantial number of small entities. Moreover, the

Commission's policy is to waive the regulatory fee for licensees

which can establish that payment of the regulatory fees would create

a compelling case of financial hardship.

7. Description of Projected Reporting, Record Keeping and Other

Compliance Requirements: Compliance with the fee schedule requires

CMRS licensees to tabulate the number of units they have in service,

complete and file a form FCC 159, and pay an annual regulatory fee

based on the number of units in service. Licensees ordinarily will

keep a list of the number of units they have in service as part of

their normal business practices. No outside professional skills are

required to complete the form FCC 159, and it can be completed by

the employees responsible for an entity's business records. The

Commission estimates that it will take each licensee about 5-15

minutes to fill in and file a form FCC 159 after computing the

number of units subject to the fee. As an option, licensees are

permitted to file electronically or on computer diskette to ease the

burden of filing information which would require multiple forms FCC

159. Although not mandatory, the latter may require additional

professional skills. For Cellular and Public Mobile Services

licensees there is no change to these requirements. Licensees who

paid small fees in advance supplied fee information as part of their

application and did not use form FCC 159. When and if they convert

to CMRS, they must use the form FCC 159, but the impact would be

minimal since the basic information is the same as was on the

application form.

8. Minimizing the Impact on Small Entities and Consistent with

Stated Objectives: Although no comments were submitted on the IRFA,

we have amended our procedures in a manner calculated to minimize

the impact on small entities. The fee schedule will assess the fees

to be paid by those who choose to convert from PMRS to CMRS in the

future, and require that the fees be paid on an annual basis. These

new CMRS licensees will also be required to make annual fee

payments, since single advance payments would no longer be

practicable because of fluctuations in the numbers of units a

licensee may have in service over the length of its license term.

Additionally, the economic burden of annual fee payments would be

substantially less than would be the burden of requiring advance

payment of larger fees. Moreover, the conversion is voluntary, and

any licensee can avoid the burden by remaining a private carrier. In

addition, because the conversion of existing stations will not take

effect until August 10, 1996, licensees who have not converted will

be exempt from the fee for FY 1996. Finally, in order to ease the

burden on small entities, licensees with fee obligations of less

than $10 will be exempt from the fees.

[This Appendix B will not be published in the Code of Federal

Regulations]

Appendix B--Sources of Payment Unit Estimates for FY 1996

In order to calculate individual service fees for FY 1996, we

adjusted FY 1995 payment units for each service to more accurately

reflect expected FY 1996 payment liabilities. We obtained our

updated estimates through a variety of means. For example, we used

Commission licensee data bases, actual prior year payment records

and industry and trade association projections when available. We

tried to obtain verification for these estimates from multiple

sources and, in all cases, we compared FY 1996 estimates with actual

FY 1995 payment units to ensure that our revised estimates were

reasonable. Where it made sense, we adjusted and/or rounded our

final estimates to take into consideration the fact that certain

variables that impact on the number of payment units yet cannot be

estimated exactly. These include an unknown number of waivers and/or

exemptions that may occur in FY 1996 and the fact that, in many

services, the number of actual licensees or station operators

fluctuates from time to time due to economic, technical or other

reasons. Therefore, when we note, for example, that our estimated FY

1996 payment units are based on FY 1995 actual payment units, it

does not necessarily mean that our FY 1996 projection is exactly the

same number as FY 1995. It means that we have either rounded the FY

1995 number or adjusted it slightly to account for these variables.

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

Sources of payment unit

Fee Category estimates

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

Land Mobile (All), Microwave, IVDS, Marine Based on Wireless

(Ship & Coast), Aviation (Aircraft & Telecommunications Bureau

Ground), GMRS, Amateur Vanity Call Signs, (WTB) projections of new

Domestic Public Fixed. applications and renewals

taking into consideration

existing Commission

licensee data bases.

Aviation (Aircraft) and

Marine (Ship) estimates

have been adjusted to take

into consideration

proposals to license

portions of these services

on a voluntary basis.

CMRS Mobile Services (incl. Cellular/ Based on actual FY 1995

Public Mobile Radio Services and Two Way payment units adjusted to

Paging Services). take into consideration

industry estimates of

growth between FY 1995 and

FY 1996 and Wireless

Telecommunications Bureau

projections of new

applications and average

number of mobile units

associated with each

application.

CMRS One Way Paging Services.............. Based on industry estimates

of the number of pager

units in operation.

AM/FM Radio Stations...................... Based on actual FY 1995

payment units.

UHF/VHF Television Stations............... Based on actual FY 1995

payment units.

AM/FM/TV Construction Permits............. Based on actual FY 1995

payment units.

LPTV, Translators and Boosters............ Based on actual FY 1995

payment units.

Auxiliaries............................... Based on actual FY 1995

payment units.

MDS/MMDS.................................. Based on actual FY 1995

payment units.

Cable Antenna Relay System (CARS)......... Based on actual FY 1995

payment units.

Cable Television System Subscribers....... Based on Cable Services

Bureau and industry

estimates of

subscribership.

[[Page 36644]]

IXCs/LECs, CAPs, Other Service Providers.. Based on actual FY 1995

interstate revenues

associated with

contributions to the

Telecommunications Relay

System (TRS) Fund adjusted

to take into consideration

FY 1996 revenue growth in

this industry as estimated

by the Common Carrier

Bureau.

Earth Stations............................ Based on actual FY 1995

payment units.

Space Stations & LEOs..................... Based on International

Bureau licensee data bases.

International Bearer Circuits............. Based on actual FY 1995

payment units.

International HF Broadcast Stations, Based on actual FY 1995

International Public Fixed Radio Service. payment units.

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

[[Page 36645]]

Appendix C

[This Appendix C will not be published in the Code of Federal Regulations]

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

FY 1996 Regulatory fees-calculation of mandatory adjustments

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

Fee category (times) (equals) Recalculated Rounded fee New FY 1996

FY 1996 Payment (times) Adj. FY Applicable Computed FY Pro-rated fee revenue

units 1995 fee years 1996 revenue revenue **

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

LM (220 MHz. > 470 MHZ-Base, SMRS....................... 1,350 6 5 $40,500 45,125 7 7 47,250

Microwave............................................... 7,025 6 10 421,500 469,635 7 7 491,750

IVDS.................................................... 10 6 5 300 334 7 7 350

Marine (Ship)........................................... 24,650 3 10 739,500 823,951 3 3 739,500

GMS..................................................... 1,025 3 5 15,375 17,131 3 3 15,375

LM (Other).............................................. 75,000 3 5 1,125,000 1,253,475 3 3 1,125,000

Aviation (Aircraft)..................................... 12,050 3 10 361,500 402,783 3 3 361,500

Marine (Coast).......................................... 1,800 3 5 27,000 30,083 3 3 27,000

Aviation (Ground)....................................... 17,00 3 5 25,500 28,412 3 3 25,500

Amateur Vanity Calls Signs.............................. 20,000 3 10 600,000 668,520 3 3 600,000

AM Class A.......................................... 110 1,120 1 123,200 137,269 1,248 1,250 137,500

AM Class B.......................................... 1,350 620 1 837,000 932,585 691 690 931,500

AM Class C.......................................... 1,080 250 1 270,000 300,824 279 280 302,400

AM Class D.......................................... 1,450 310 1 449,500 500,833 345 345 500,250

AM Construction Permits............................. 35 125 1 4,375 4,875 139 140 4,900

FM Classes C, C1, C2, B............................. 2,220 1,120 1 2,486,400 2,770,347 1,248 1,250 2,775,000

FM Classes A, B1, C3................................ 2,200 745 1 1,639,000 1,826,174 830 830 1,826,000

FM Construction Permits............................. 350 620 1 217,000 241,781 691 690 241,500

TV Satellites........................................... 90 620 1 55,800 62,172 691 690 62,100

VHF Construction Permits............................ 10 4,975 1 49,750 55,431 5,543 5,550 55,500

UHF Construction Permits............................ 60 3,975 1 238,500 265,737 4,429 4,425 265,500

Auxilliaries............................................ 20,000 30 1 600,000 668,520 33 35 700,000

International HF Broadcast.............................. 4 250 1 1,000 1,114 279 280 1,120

LPTV/Translators/Boosters............................... 2,000 170 1 340,000 378,828 189 190 380,000

Satellite TV Construction Permit........................ 5 225 1 1,125 1,253 251 250 1,250

CARS.................................................... 2,200 290 1 638,000 710,860 323 325 715,000

Cable Systems........................................... 62,000,000 0.49 1 30,380,000 33,849,396 0.55 0.55 34,100,000

IXC, LECs, CAPS, Others................................. 56,467,000,000 0.00088 1 49,690,960 55,365,668 0.00098 0.00098 55,337,660

CMRS Mobile Services (Cellular/Public Mobile)........... 30,000,000 0.15 1 4,500,000 5,013,900 0.17 0.17 5,100,000

CMRAS--One Way Paging................................... 24,500,000 0.02 1 490,000 545,958 0.02 0.02 490,000

Domestic Public Fixed................................... 16,000 140 1 2,240,000 2,495,808 156 155 2,480,000

MDS/MMDS................................................ 1,130 140 1 158,200 176,266 156 155 175,150

International Circuits.................................. 228,000 4 1 912,000 1,016,150 4 4 912,000

International Public Fixed.............................. 15 200 1 3,000 3,343 223 225 3,375

Earth Stations.......................................... 5,700 330 1 1,881,000 2,095,810 368 370 2,109,000

Space Stations (Geosynchronous)......................... 38 75,000 1 2,850,000 3,175,470 83,565 83,575 3,175,850

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

****** Total Estimated Revenue Collected.......... ............... ............... ............... $104,411,985 $116,335,834 ............... ............... $116,215,780

****** Total Revenue Requirement.................. ............... ............... ............... $116,340,000 $116,340,000 ............... ............... $116,340,000

Difference........................................ ............... ............... ............... ($11,928,015) ($4,166) ............... ............... ($124,220)

** 1.1142 factor applied to other than TV............... ............... ............... ............... ............... ............... ............... ............... ...............

Television stations:

VHF Markets 1-10.................................... 40 32,000 1 1,280,000 ............... ............... 32,000 1,280,000

VHF Markets 11-25................................... 45 26,000 1 1,170,000 ............... ............... 26,000 1,170,000

VHF Markets 26-50................................... 80 17,000 1 1,360,000 ............... ............... 17,000 1,360,000

VHF Markets 51-100.................................. 110 9,000 1 990,000 ............... ............... 9,000 990,000

VHF Remaining Markets............................... 200 2,500 1 500,000 ............... ............... 2,500 500,000

[[Page 36646]]

UHF Markets 1-10.................................... 65 25,000 1 1,625,000 ............... ............... 25,000 1,625,000

UHF Markets 11-25................................... 60 20,000 1 1,200,000 ............... ............... 20,000 1,200,000

UHF Markets 26-50................................... 65 13,000 1 845,000 ............... ............... 13,000 845,000

UHF Markets 51-100.................................. 110 7,000 1 770,000 ............... ............... 7,000 770,000

UHF Remaining Markets............................... 160 2,000 1 320,000 ............... ............... 2,000 320,000

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

**** Total Estimated Revenue-Television (less Sat.

TV).............................................. ............... ............... ............... $10,060,000 ............... ............... ............... $10,060,000

Total Estimated Fee Revenue....................... ............... ............... ............... ............... ............... ............... ............... $126,275,780

Total Revenue Requirement......................... ............... ............... ............... ............... ............... ............... ............... $126,400,000

Difference........................................ ............... ............... ............... ............... ............... ............... ............... ($124,220)

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

[[Page 36647]]

Appendix D--FY 1996 Schedule of Regulatory Fees

[This Appendix D will not be published in the Code of Federal

Regulations]

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

Annual

Fee category regulatory

fee

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

Land Mobile (per license) (220-222 Mhz, above 470 Mhz, Base

Station and SMRS) (47 CFR Part 90)........................ 7

Microwave (per license) (47 CFR Part 101).................. 7

Interactive Video Data Service (per license) (47 CFR Part

95)....................................................... 7

Marine (Ship) (per station) (47 CFR Part 80)............... 3

Marine (Coast) (per license) (47 CFR Part 80).............. 3

General Mobile Radio Service (per license) (47 CFR Part 95) 3

Land Mobile (per license) (all stations not covered above). 3

Aviation (Aircraft) (per station) (47 CFR Part 87)......... 3

Aviation (Ground) (per license) (47 CFR Part 87)........... 3

Amateur Vanity Call Signs (per call sign) (47 CFR Part 97). 3

CMRS Mobile Services (per unit) (47 CFR Parts 20, 22, 80

and 90)................................................... .17

CMRS One-Way Paging (per unit) (47 CFR Parts 20, 22 and 90) .02

Domestic Public Fixed Radio & Multipoint Distribution

Services (per call sign) (47 CFR Part 21)................. 155

AM Radio (47 CFR Part 73):

Class A................................................ 1,250

Class B................................................ 690

Class C................................................ 280

Class D................................................ 345

Construction Permits................................... 140

FM Radio (47 CFR Part 73):

Classes C, C1, C2, B................................... 1,250

Classes A, B1, C3...................................... 830

Construction Permits................................... 690

TV (47 CFR Part 73) VHF Commercial:

Markets 1-10........................................... 32,000

Markets 11-25.......................................... 26,000

Markets 26-50.......................................... 17,000

Markets 51-100......................................... 9,000

Remaining Markets...................................... 2,500

Construction Permits................................... 5,550

TV (47 CFR Part 73) UHF Commercial:

Markets 1-10........................................... 25,000

Markets 11-25.......................................... 20,000

Markets 26-50.......................................... 13,000

Markets 51-100......................................... 7,000

Remaining Markets...................................... 2,000

Construction Permits................................... 4,425

Satellite Television Stations (All Markets)................ 690

Construction Permits--Satellite Television Stations........ 250

Low Power TV, TV/FM Translators & Boosters (47 CFR Part 74) 190

Broadcast Auxiliary (47 CFR Part 74)....................... 35

Cable Antenna Relay Service (47 CFR Part 78)............... 325

Cable Television Systems (per subscriber) (47 CFR Part 76). .55

Interstate Telephone Service Providers (per revenue dollar) .00098

Earth Stations (47 CFR Part 25)............................ 370

Space Stations (per operational station in geosynchronous

orbit) (47 CFR Part 25) also includes Direct Broadcast

Satellite Service (per operational station) (47 CFR Part

100)...................................................... 70,575

Low Earth Orbit Satellite (per operational system) (47 CFR

Part 25).................................................. 97,725

INMARSAT/INTELSAT Signatory (per signatory)................ 233,425

International Circuits (per active 64KB circuit)........... 4

International Public Fixed (per call sign) (47 CFR Part 23) 225

International (HF) Broadcast (47 CFR Part 73).............. 280

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

Appendix E--Comparison Between FY 1995, FY 1996 Proposed and FY 1996 Final Regulatory Fees

[This Appendix E will not be published in the Code of Federal Regulations]

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

Annual Annual

Fee category regulatory fee NPRM proposed regulatory fee

FY 1995 fee FY 1996 FY 1996

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

Land Mobile (per license) (220-222 Mhz, above 470 Mhz, Base

Station and SMRS) (47 CFR Part 90)........................... 6 6 7

Microwave (per license) (47 CFR Part 101)..................... 6 6 7

Interactive Video Data Service (per license) (47 CFR Part 95). 6 6 7

Marine (Ship) (per station) (47 CFR Part 80).................. 3 3 3

Marine (Coast) (per license) (47 CFR Part 80)................. 3 3 3

General Mobile Radio Service (per license) (47 CFR Part 95)... 3 3 3

Land Mobile (per license) (all stations not covered above).... 3 3 3

Aviation (Aircraft) (per station) (47 CFR Part 87)............ 3 3 3

[[Page 36648]]

Aviation (Ground) (per license) (47 CFR Part 87).............. 3 3 3

Amateur Vanity Call Signs (per call sign) (47 CFR Part 97).... 3 3 3

CMRS Mobile Services (per unit) (47 CFR Parts 20, 22, 80 and

90).......................................................... .15 .15 .17

CMRS One-Way Paging (per unit) (47 CFR Parts 20, 22, and 90).. .02 .02 .02

Domestic Public Fixed Radio & Multipoint Distribution Services

(per call sign) (47 CFR Part 21)............................. 140 140 155

AM Radio (47 CFR Part 73):

Class A................................................... 1,120 1,125 1,250

Class B................................................... 620 630 690

Class C................................................... 250 255 280

Class D................................................... 310 315 345

Construction Permits...................................... 125 125 140

FM Radio (47 CFR Part 73):

Classes C, C1, C2, B...................................... 1,120 1,125 1,250

Classes A, B1, C3......................................... 745 755 830

Construction Permits...................................... 620 625 690

TV (47 CFR Part 73) VHF Commercial:

Markets 1-10.............................................. 22,420 22,700 32,000

Markets 11-25............................................. 19,925 20,175 26,000

Markets 26-50............................................. 14,950 15,125 17,000

Markets 51-100............................................ 9,975 10,100 9,000

Remaining Markets......................................... 6,225 6,300 2,500

Construction Permits...................................... 4,975 5,025 5,550

TV (47 CFR Part 73) UHF Commercial:

Markets 1-10.............................................. 17,925 18,150 25,000

Markets 11-25............................................. 15,950 16,150 20,000

Markets 26-50............................................. 11,950 12,100 13,000

Markets 51-100............................................ 7,975 8,075 7,000

Remaining Markets......................................... 4,975 5,025 2,000

Construction Permits...................................... 3,975 4,025 4,425

Satellite Television Stations (All Markets)................... 620 625 690

Construction Permits--Satellite Television Stations........... 225 230 250

Low Power TV, TV/FM Translators & Boosters (47 CFR Part 74)... 170 170 190

Broadcast Auxiliary (47 CFR Part 74).......................... 30 30 35

Cable Antenna Relay Service (47 CFR Part 78).................. 290 295 325

Earth Stations (47 CFR Part 25)............................... 330 335 370

Cable Television Systems (per subscriber) (47 CFR Part 76).... .49 .50 .55

Interstate Telephone Service Providers (per revenue dollar)... .00088 .00089 .00098

Space Stations (per operational station in geosynchronous

orbit) (47 CFR............................................... 75,000 63,500 70,575

Part 25) also includes Direct Broadcast Satellite Service (per

operational station) (47 CFR Part 100)....................... n/a 63,500 70,575

Low Earth Orbit Satellite (per operational system) (47 CFR

Part 25)..................................................... n/a 87,725 97,725

INMARSAT/INTELSAT Signatory (per signatory)................... n/a 217,575 233,425

International Circuits (per active 64KB circuit).............. 4 4 4

International Public Fixed (per call sign) (47 CFR Part 23)... 200 200 225

International (HF) Broadcast (47 CFR Part 73)................. 250 255 280

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

[This Appendix F will not be published in the Code of Federal

Regulations]

Appendix F--FY 1996 Guidelines for Regulatory Fee Categories

1. The guidelines below provide an explanation of regulatory fee

categories established by the Schedule of Regulatory Fees in section

9 (g) of the Communications Act, 47 U.S.C. 159(g) as modified in the

instant Report and Order. Where regulatory fee categories need

interpretation or clarification, we have relied on the legislative

history of section 9, our own experience in establishing and

regulating the Schedule of Regulatory Fees for Fiscal Years (FY)

1994 and 1995 and the services subject to the fee schedule, and the

comments of the parties in our proceeding to adopt fees for FY 1995.

The categories and amounts set out in the schedule have been

modified to reflect changes in the number of payment units,

additions and changes in the services subject to the fee requirement

and the benefits derived from the Commission's regulatory

activities, and to simplify the structure of the schedule. The

schedule may be similarly modified or adjusted in future years to

reflect changes in the Commission's budget and in the services

regulated by the Commission. See 47 U.S.C. 159(b)(2), (3).

2. Exemptions. Most licensees and other entities regulated by

the Commission must pay regulatory fees in 1996. However,

governments and nonprofit (exempt under Section 501 of the Internal

Revenue Code) entities are exempt from paying regulatory fees and

should not submit payment, but may be asked to submit a current IRS

Determination Letter documenting its nonprofit status, a

certification of governmental authority, or certification

[[Page 36649]]

from a governmental entity attesting to its exempt status. The

governmental exemption applies even where the government-owned or

community-owned facility is in direct competition with commercial

stations. Other specific exemptions are discussed below in association

with a particular service category or group.

I. Private Wireless Radio Services

3. Two levels of statutory fees were established for the Private

Wireless Radio Services--exclusive use services and shared use

services. Thus, licensees who generally receive a higher quality

communication channel due to exclusive or lightly shared frequency

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

quality assignments. This dichotomy is consistent with the directive

of section 9 that the regulatory fees reflect the benefits provided

to the licensees. See 47 U.S.C. Sec. 159(b)(1)(A). In addition,

because of the generally small amount of the fees assessed against

Private Wireless Radio Service licensees, applicants for new

licenses and reinstatements and for renewal of existing licenses are

required to pay a regulatory fee covering the entire license term,

with only a percentage of all licensees paying a regulatory fee in

any one year. Applications for modification or assignment of

existing authorizations do not require the payment of regulatory

fees. The expiration date of those authorizations will reflect only

the unexpired term of the underlying license rather than a new

license term.

a. Exclusive Use Services

4. Land Mobile Services: Regulatees in this category include

those authorized under Part 90 of the Commission's Rules to provide

limited access Wireless Radio service that allows high quality voice

or digital communications between vehicles or to fixed stations to

further the business activities of the licensee. These services,

using the 220-222 MHz band and frequencies at 470 MHz and above, may

be offered on a private carrier basis in the Specialized Mobile

Radio Services (SMRS).\1\ For FY 1996, Land Mobile licensees will

pay a $7 annual regulatory fee per license, payable for an entire

five or ten year license term at the time of application for a new,

renewal or reinstatement license.\2\ The total regulatory fee due is

either $35 for a license with a five year term or $70 for a license

with a 10 year term.

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

\1\ This category only applies to licensees of shared-use

private 220-222 MHz and 470 MHz and above in the Specialized Mobile

Radio (SMR) service who have elected not to change to the Commercial

Mobile Radio Service (CMRS). Those who have elected to change to the

CMRS are referred to paragraph 14 of this Appendix.

\2\ Although this fee category includes licenses with ten year

terms, the estimated volume of ten year license applications in FY

1996 is less than one tenth of one percent and, therefore, is

statistically insignificant.

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

5. Microwave Services: These services include private microwave

systems and private carrier systems authorized under Part 101 of the

Commission's Rules to provide telecommunications services between

fixed points on a high quality channel of communications. Microwave

systems are often used to relay data and to control railroad,

pipeline and utility equipment. For FY 1996, Microwave licensees

will pay a $7 annual regulatory fee per license, payable for an

entire ten year license term at the time of application for a new,

renewal or reinstatement license. The total regulatory fee due is

$70 for the ten year license term.

6. Interactive Video Data Service (IVDS): The IVDS is a two-way

point-to-multi-point radio service allocated high quality channels

of communications and authorized under Part 95 of the Commission's

Rules. The IVDS provides information, products and services, and

also the capability to obtain responses from subscribers in a

specific service area. The IVDS is offered on a private carrier

basis. For FY 1996, IVDS licensees will pay a $7 annual regulatory

fee per license, payable for an entire five year license term at the

time of application for a new, renewal, or reinstatement license.

The total regulatory fee due is $35 for the five year term of the

license.

b. Shared Use Services

7. Marine (Ship) Service: This service is a shipboard radio

service authorized under Part 80 of the Commission's Rules to

provide telecommunications between watercraft or between watercraft

and shore-based stations. Radio installations are required by

domestic and international law for large passenger or cargo vessels.

Radio equipment may be voluntarily installed on smaller vessels,

such as recreational boats. The recently enacted Telecommunications

Act of 1996 gave the Commission the authority to license certain

ship stations by rule rather than by individual license. Private

boat operators sailing entirely within domestic U.S. waters and who

are not otherwise required by treaty or agreement to carry a radio,

may no longer be required to hold a marine license if the Commission

enacts rules to that effect, and they will not be required to pay a

regulatory fee. For FY 1996, parties required to be licensed and

those choosing to be licensed for Marine (Ship) Stations will pay a

$3 annual regulatory fee per station, payable for an entire ten year

license term at the time of application for a new, renewal or

reinstatement license. The total regulatory fee due is $30 for the

ten year license term.

8. Marine (Coast) Service: This service includes land-based

stations in the maritime services, authorized under Part 80 of the

Commission's Rules, to provide communications services to ships and

other watercraft in coastal and inland waterways. For FY 1996,

licensees of Marine (Coast) Stations will pay a $3 annual regulatory

fee per call sign, payable for the entire five year license term at

the time of application for a new, renewal or reinstatement license.

The total regulatory fee due is $15 per call sign for the five year

license term.

9. Private Land Mobile (Other) Services: These services include

Land Mobile Radio Services operating under Parts 90 and 95 of the

Commission's Rules. Services in this category provide one or two way

communications between vehicles, persons or to fixed stations on a

shared basis and include radiolocation services, industrial radio

services and land transportation radio services. For FY 1996,

licensees of services in this category will pay a $3 annual

regulatory fee per call sign, payable for an entire five year

license term at the time of application for a new, renewal or

reinstatement license. The total regulatory fee due is $15 for the

five year license term.

10. Aviation (Aircraft) Service: These services include stations

authorized to provide communications between aircraft and from

aircraft to ground stations and includes frequencies used to

communicate with air traffic control facilities pursuant to Part 87

of the Commission's Rules. The recently enacted Telecommunications

Act of 1996 gave the Commission the authority to license certain

aircraft radio stations by rule rather than by individual license.

Private aircraft operators flying entirely within domestic U.S.

airspace and who are not otherwise required by treaty or agreement

to carry a radio, may no longer be required to hold an aircraft

license if the Commission enacts rules to that effect, and they will

not be required to pay a regulatory fee. For FY 1996, parties

required to be licensed and those choosing to be licensed for

Aviation (Aircraft) Stations will pay a $3 annual regulatory fee per

station, payable for the entire ten year license term at the time of

application for a new, renewal or reinstatement license. The total

regulatory fee due is $30 per station for the ten year license term.

11. Aviation (Ground) Service: This service includes stations

authorized to provide ground-based communications to aircraft for

weather or landing information, or for logistical support pursuant

to Part 87 of the Commission's Rules. Certain ground-based stations

which only serve itinerant traffic; i.e., possess no actual units on

which to assess a fee, are exempt from payment of regulatory fees.

For FY 1996, licensees of Aviation (Ground) Stations will pay a $3

annual regulatory fee per license, payable for the entire five year

license term at the time of application for a new, renewal or

reinstatement license. The total regulatory fee is $15 per call sign

for the five year license term.

12. General Mobile Radio Service (GMRS): These services include

Land Mobile Radio licensees providing personal and limited business

communications between vehicles or to fixed stations for short-

range, two-way communications pursuant to Part 95 of the

Commission's Rules. For FY 1996, GMRS licensees will pay a $3 annual

regulatory fee per license, payable for an entire five year license

term at the time of application for a new, renewal or reinstatement

license. The total regulatory fee due is $15 per license for the

five year license term.

c. Amateur Radio Vanity Call Signs

13. Amateur Vanity Call Signs: This fee covers voluntary

requests for specific call signs in the Amateur Radio Service

authorized under part 97 of the Commission's Rules. For FY 1996,

applicants for Amateur Vanity Call-Signs will pay a $3 annual

regulatory fee per call sign, payable for an entire ten year license

term at the time of application for a vanity call sign. The total

[[Page 36650]]

regulatory fee due would be $30 per license for the ten year license

term.\3\

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

\3\ Section 9(h) exempts ``amateur radio operator licenses under

Part 97 of the Commission's rules (47 CFR Part 97)'' from the

requirement. However, Section 9(g)'s fee schedule explicitly

includes ``Amateur vanity call signs'' as a category subject to the

payment of a regulatory fee.

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

d. Commercial Wireless Radio Services

14. Commercial Mobile Radio Services (CMRS) Mobile Services: The

Commercial Mobile Radio Service (CMRS) is a new ``umbrella''

descriptive term attributed to various existing services authorized

to provide interconnected mobile radio services for profit to the

public, or to such classes of eligible users as to be effectively

available to a substantial portion of the public. CMRS Mobile

Services include certain licensees which formerly were licensed as

part of the Private Radio Services (e.g., Specialized Mobile Radio

Services) and others formerly licensed as part of the Common Carrier

Radio Services (e.g., Public Mobile Services and Cellular Radio

Service). While specific rules pertaining to each covered service

remain in separate Parts 22, 80 and 90; general rules for CMRS are

contained in Part 20. We have replaced the Public Mobile/Cellular

Radio regulatory fee category with a CMRS Mobile Services category

for regulatory fee collection purposes. CMRS Mobile Services will

include: qualifying Business Radio Services, 220-222 MHz Land Mobile

Systems, Specialized Mobile Radio Services (Part 90); \4\ Public

Coast Stations (Part 80); Public Mobile Radio, Cellular, 800 MHz

Air-Ground Radiotelephone, and Offshore Radio Services (Part 22).

Licensees who have not elected to convert from private to commercial

operations will be exempt from payment of the annual CMRS Mobile

Services fee for FY 1996. Existing commercial licensees and those

who converted prior to December 31, 1995, must pay the annual CMRS

Mobile Services fee for FY 1996. Each licensee in this group will

pay an annual regulatory fee for each mobile or cellular unit

(mobile or cellular call sign or telephone number), including two-

way paging units, assigned to its customers, including resellers of

its services. For FY 1996, the regulatory fee is $.17 per unit.

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

\4\ This category does not include licensees of private shared-

use 220 MHz and 470 MHz and above in the Specialized Mobile Radio

(SMR) service who have elected to remain non-commercial. Those who

have elected not to change to the Commercial Mobil Radio Service

(CMRS) are referred to paragraph 4 of this Appendix. Further,

Congress provided for a three year transition period until August

10, 1996, for conversion to CMRS. See Omnibus Budget Reconciliation

Act of 1993, Public Law No. 103-66, Title VI Sec. 6002(b), 107 Stat.

312,392. Therefore, licensees who had not converted to CMRS prior to

December 31, 1995, are not subject to the CMRS Mobile Services fee

for FY 1996.

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

15. Personal Communications Service (PCS): For FY 1996, the

Personal Communications Service (PCS) covered by Part 24 of the

rules is exempt from payment of regulatory fees.

16. Commercial Mobile Radio Services (CMRS) One-Way Paging

Services: The Commercial Mobile Radio Service (CMRS) is a new

``umbrella'' descriptive term attributed to various existing

services authorized to provide interconnected mobile radio services

for profit to the public, or to such classes of eligible users as to

be effectively available to a substantial portion of the public.

CMRS One-Way Paging Services include certain licensees which

formerly were licensed as part of the Private Radio Services (e.g.,

Private Paging) and others formerly licensed as part of the Common

Carrier Radio Services (e.g., Public Mobile One-Way Paging). While

specific rules pertaining to each covered service remain in separate

Parts 22 and 90; general rules for CMRS are contained in Part 20. We

have replaced the Public Mobile One-Way Paging regulatory fee

category with a CMRS One-Way Paging Services category for regulatory

fee collection purposes. Licensees who have not elected to convert

from private to commercial operations will be exempt from payment of

the annual CMRS One-Way Paging Services fee for FY 1996. Existing

commercial licensees and those who converted prior to December 31,

1995, must pay the annual CMRS One-Way Paging Services fee for FY

1996. Each licensee in the CMRS One-Way Paging Services will pay an

annual regulatory fee for each paging unit, assigned to its

customers, including resellers of its services. For FY 1996, the

regulatory fee is $.02 per unit.

II. Mass Media Services

17. The regulatory fees for the Mass Media fee category apply to

broadcast licensees and permittees. Noncommercial Educational

Broadcasters are exempt from regulatory fees.

a. Commercial AM and FM Radio

18. These categories include licensed Commercial AM (Classes A,

B, C, and D) and FM (Classes A, B, B1, C, C1, C2, and C3) Radio

Stations operating under Part 73 of the Commission's Rules.\5\ The

regulatory fees for AM and FM Stations for FY 1996 are as follows:

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

\5\ The Commission acknowledges that certain stations operating

in Puerto Rico and Guam have been assigned a higher level station

class than would be expected if the station were located on the

mainland. Although this results in a higher regulatory fee, we

believe that the increased interference protection associated with

the higher station class is necessary and justifies the fee.

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AM Radio

Class A..........................................................$1,250

Class B.............................................................690

Class C.............................................................280

Class D.............................................................345

FM Radio

Classes C, C1, C2, B.............................................$1,250

Classes A, B1, C3...................................................830

b. Construction Permits--Commercial AM Radio

19. This category includes holders of permits to construct new

Commercial AM Stations. For FY 1996, permittees will pay a fee of

$140 for each permit held. Upon issuance of an operating license,

this fee would no longer be applicable and licensees would be

required to pay the applicable fee for the designated class of the

station.

c. Construction Permits--Commercial FM Radio

20. This category includes holders of permits to construct new

Commercial FM Stations. For FY 1996, permittees will pay a fee of

$690 for each permit held. Upon issuance of an operating license,

this fee would no longer be applicable. Instead, licensees would pay

a regulatory fee based upon the designated class of the station.

d. Commercial Television Stations

21. This category includes licensed Commercial VHF and UHF

Television Stations covered under Part 73 of the Commission's Rules,

except commonly owned Television Satellite Stations, addressed

separately below. Markets are Nielsen Designated Market Areas (DMA)

as listed in the Television & Cable Factbook, Stations Volume No.

63, 1995 Edition, Warren Publishing, Inc. The fees for each category

of station are as follows:

VHF Markets 1-10................................................$32,000

VHF Markets 11-25................................................26,000

VHF Markets 26-50................................................17,000

VHF Markets 51-100................................................9,000

VHF Remaining Markets.............................................2,500

UHF Markets 1-10................................................$25,000

UHF Markets 11-25................................................20,000

UHF Markets 26-50................................................13,000

UHF Markets 51-100................................................7,000

UHF Remaining Markets.............................................2,000

e. Commercial Television Satellite Stations

22. Commonly owned Television Satellite Stations in any market

(authorized pursuant to Note 5 of Section 73.3555 of the

Commission's Rules) that retransmit programming of the primary

station are assessed a fee of $690 annually. Those stations

designated as Television Satellite Stations in the 1995 Edition of

the Television and Cable Factbook are subject to the fee applicable

to Television Satellite Stations. All other television licensees are

subject to the regulatory fee payment required for their class of

station and market.

f. Construction Permits--Commercial VHF Television Stations

23. This category includes holders of permits to construct new

Commercial VHF Television Stations. For FY 1996, VHF permittees will

pay an annual regulatory fee of $5,550. Upon issuance of an

operating license, this fee would no longer be applicable. Instead,

licensees would pay a fee based upon the designated market of the

station.

g. Construction Permits--Commercial UHF Television Stations

24. This category includes holders of permits to construct new

UHF Television Stations. For FY 1996, UHF Television permittees will

pay an annual regulatory fee of $4,425. Upon issuance of an

operating license, this fee would no longer be applicable. Instead,

licensees would pay a fee based upon the designated market of the

station.

h. Construction Permits--Satellite Television Stations

25. The fee for UHF and VHF Television Satellite Station

construction permits for FY

[[Page 36651]]

1996 is $250. An individual regulatory fee payment is to be made for

each Television Satellite Station construction permit held.

i. Low Power Television, FM Translator and Booster Stations, TV

Translator and Booster Stations

26. This category includes Low Power UHF/VHF Television stations

operating under Part 74 of the Commission's Rules with a transmitter

power output limited to 1 kW for a UHF facility and, generally, 0.01

kW for a VHF facility. Low Power Television (LPTV) stations may

retransmit the programs and signals of a TV Broadcast Station,

originate programming, and/or operate as a subscription service.

This category also includes translators and boosters operating under

Part 74 which rebroadcast the signals of full service stations on a

frequency different from the parent station (translators) or on the

same frequency (boosters). The stations in this category are

secondary to full service stations in terms of frequency priority.

We have also received requests for waivers of the regulatory fees

from operators of community based Translators. These Translators are

generally not affiliated with commercial broadcasters, they are

nonprofit, nonprofitable, or only marginally profitable, serve small

rural communities, and are supported financially by the residents of

the communities served. We are aware of the difficulties these

Translators have in paying even minimal regulatory fees, and we have

addressed those concerns in the ruling on reconsideration of the FY

1994 Report and Order. Community based Translators are exempt from

regulatory fees. For FY 1996, licensees in this category will pay a

regulatory fee of $190 for each license held.

j. Broadcast Auxiliary Stations

27. This category includes licensees of remote pickup stations,

Aural Broadcast Auxiliary Stations, Television Broadcast Auxiliary

Stations, and Low Power Auxiliary Stations, authorized under Part 74

of the Commission's Rules. Auxiliary Stations are generally

associated with a particular television or radio broadcast station

or cable television system. For FY 1996, licensees of Commercial

Auxiliary Stations will pay a $35 annual regulatory fee on a per

call sign basis.

k. Multipoint Distribution Service

28. This service is included in the Domestic Public Fixed

Service category and covers Multipoint Distribution Service (MDS),

and Multichannel Multipoint Distribution Service (MMDS), authorized

under Part 21 of the Commission's Rules to use microwave frequencies

for video and data distribution within the United States. For FY

1996, MDS and MMDS stations will pay an annual regulatory fee of

$155 per call sign. See para. 31 below.

III. Cable Services

a. Cable Television Systems

29. This category includes operators of Cable Television

Systems, providing or distributing programming or other services to

subscribers under Part 76 of the Commission's Rules. For FY 1996

Cable Systems will pay a regulatory fee of $.55 per subscriber.\6\

Payments for Cable Systems are to be made on a per subscriber by

community unit basis as of December 31, 1995. Cable Systems should

determine their subscriber numbers by calculating the number of

single family dwellings, the number of individual households in

multiple dwelling units, e.g., apartments, condominiums, mobile home

parks, etc., paying at the basic subscriber rate, the number of bulk

rate customers and the number of courtesy or fee customers. In order

to determine the number of bulk rate subscribers, a system should

divide its bulk rate charge by the annual subscription rate for

individual households. See FY 1994 Report and Order, Appendix B at

para. 31.

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\6\ Cable systems are to pay their regulatory fees on a per

subscriber basis rather than per 1,000 subscribers as set forth in

the statutory fee schedule. See FY 1994 Report and Order at para.

100.

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b. Cable Antenna Relay Service

30. This category includes Cable Antenna Relay Service (CARS)

stations used to transmit television and related audio signals,

signals of AM and FM Broadcast Stations and cablecasting from the

point of reception to a terminal point from where the signals are

distributed to the public by a Cable Television System. For FY 1996,

licensees will pay an annual regulatory fee of $325 per CARS

license.

IV. Common Carrier Services

a. Fixed Radio Services

31. Domestic Public Fixed Radio Service: This category includes

licensees in the Point-to-Point Microwave Radio Service, Local

Television Transmission Radio Service, Digital Electronic Message

Service, Multipoint Distribution Service (MDS), and Multichannel

Multipoint Distribution Service (MMDS),\7\ authorized under Part 21

of the Commission's Rules to use microwave frequencies for video and

data distribution within the United States. For FY 1996, Domestic

Public Fixed Radio Service licensees pay a $155 annual regulatory

fee per call sign.

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\7\ MDS and MMDS are regulated by the Mass Media Bureau.

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

b. Interstate Telephone Service Providers

32. This category includes Inter-Exchange Carriers (IXCs), Local

Exchange Carriers (LECs), Competitive Access Providers (CAPs),

domestic and international carriers that provide operator services,

Wide Area Telephone Service (WATS), 800, 900, telex, telegraph,

video, other switched, interstate access, special access, and

alternative access services either by using their own facilities or

by reselling facilities and services of other carriers or telephone

carrier holding companies, and companies other than traditional

local telephone companies that provide interstate access services to

long distance carriers and other customers. This category also

includes pre-paid calling card providers. These common carriers,

including resellers, must submit fee payments based upon their

proportionate share of gross interstate revenues using the

methodology that we have adopted for calculating contributions to

the TRS fund. See Telecommunications Relay Services, 8 FCC Rcd 5300

(1993), 58 FR 39671 (1993). In order to avoid imposing any double

payment burden on resellers, we will permit carriers to subtract

from their gross interstate revenues, as reported to NECA in

connection with their TRS contribution, any payments made to

underlying common carriers for telecommunications facilities and

services, including payments for interstate access service, that are

sold in the form of interstate service. For this purpose, resold

telecommunications facilities and services are only intended to

include payments that correspond to revenues that will be included

by another carrier reporting interstate revenue. For FY 1996,

carriers should multiply their adjusted gross revenue figure (gross

revenue reduced by the total amount of their payments to underlying

common carriers for telecommunications facilities or services) by

the factor 0.00098 to determine the appropriate fee for this

category of service. You may want to use the following worksheet to

determine your fee payment:

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

Total Interstate

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

(1) Revenue reported in TRS Fund worksheets

(2) Less: Access charges paid

(3) Less: Other telecommunications facilities and

services taken for resale

(4) Adjusted revenues (1)minus (2)minus(3)

(5) Fee factor................................... ......... 0.00098

(6) Fee due (4)times(5)

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

V. International Services

a. Earth Stations

33. Very Small Aperture Terminal (VSAT) Earth Stations,

equivalent C-Band Earth Stations and antennas, and earth station

systems comprised of very small aperture terminals operate in the 12

and 14 GHz bands and provide a variety of communications services to

other stations in the network. VSAT systems consist of a network of

technically-identical small Fixed-Satellite Earth Stations which

often include a larger hub station. VSAT Earth Stations and C-Band

Equivalent Earth Stations are authorized pursuant to Part 25 of the

Commission's Rules. Mobile Satellite Earth Stations, operating

pursuant to Part 25

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