1998 Biennial Regulatory ReviewStreamlined Contributor Reporting Requirements

FEDERAL COMMUNICATIONS COMMISSION

47 CFR Parts 1, 43, 52, 54, and 64

[FCC 98-233]

1998 Biennial Regulatory Review--Streamlined Contributor

Reporting Requirements

AGENCY: Federal Communications Commission.

ACTION: Notice of proposed rulemaking.

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SUMMARY: On September 25, 1998, the Federal Communications Commission

released a Notice of Proposed Rulemaking (NPRM) that proposed to

consolidate four Commission reporting requirements so that carriers

need only file one worksheet to satisfy the reporting requirements

associated with: the universal service support mechanisms; the

telecommunications relay services support mechanism; the cost recovery

mechanism for numbering administration; and the cost recovery mechanism

for shared costs of long-term local number portability. Part of the

Commission's 1998 biennial regulatory review, the item proposes limited

changes to the Commission's rules to facilitate the introduction of a

unified worksheet. The NPRM contains proposed or modified information

collections subject to the Paperwork Reduction Act of 1995 (PRA). It

has been submitted to the Office of Management and Budget (OMB) for

review under the PRA. OMB, the general public, and other Federal

agencies are invited to comment on the proposed or modified information

collections contained in this proceeding.

DATES: Comments are due on or before October 30, 1998. Reply comments

are due on or before November 16, 1998. Written comments by the public

on the proposed information collections are due October 30, 1998, and

reply comments are due November 16, 1998. Written comments must be

submitted by the Office of Management and Budget (OMB) on the proposed

information collections on or before December 7, 1998.

ADDRESSES: Comments and reply comments should be sent to the Office of

the Secretary, Federal Communications Commission, 1919 M Street, NW,

Suite 222, Washington, DC 20554, with a copy to Scott Bergmann of the

Common Carrier Bureau, Federal Communications Commission, 2033 M

Street, NW, Suite 500, Washington, DC 20554. Parties should also file

one copy of any documents filed in this docket

[[Page 54091]]

with the Commission's copy contractor, International Transcription

Services, Inc. (ITS), 1231 20th St., NW, Washington, DC 20037. In

addition to filing comments with the Secretary, a copy of any comments

on the information collections contained herein should be submitted to

Judy Boley, Federal Communications Commission, Room 234, 1919 M Street,

NW, Washington, DC 20554, or via the Internet to [email protected] and to

Timothy Fain, OMB Desk Officer, 10236 NEOB, 725--17th Street, NW

Washington, DC 20503 or via the Internet to [email protected].

FOR FURTHER INFORMATION CONTACT: Thomas J. Beers, Deputy Chief of the

Industry Analysis Division, Common Carrier Bureau, at (202) 418-0952,

or Scott K. Bergmann, Industry Analysis Division, Common Carrier

Bureau, at (202) 418-7102.

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Notice

of Proposed Rulemaking and Notice of Inquiry released September 25,

1998 (FCC 98-233). The full text of the Notice of Proposed Rulemaking

and Notice of Inquiry is available for inspection and copying during

normal business hours in the FCC Reference Center, Room 239, 1919 M

Street, Washington, DC 20554. The complete text also may be purchased

from the Commission's copy contractor, International Transcription

Service, Inc. (202) 857-3800, 1231 20th St., NW, Washington, DC 20036.

Paperwork Reduction Act

This Notice of Proposed Rulemaking contains a proposed or modified

information collection subject to the Paperwork Reduction Act of 1995

(PRA). It has been submitted to the Office of Management and Budget

(OMB) for review under Section 3507(d) of the PRA. OMB, the general

public, and other Federal agencies are invited to comment on the

proposed information collections contained in this proceeding.

The Commission, as part of its continuing effort to reduce

paperwork burdens, invites the general public and the Office of

Management and Budget to comment on the information collections in this

NPRM. Public and agency comments are due at the same time as other

comments on the Notice of Proposed Rulemaking; OMB notification of

action is due December 7, 1998. Comments should address: (a) whether

the proposed collection of information is necessary for the proper

performance of the functions of the Commission, including whether the

information shall have practical utility; (b) the accuracy of the

Commission's burden estimates; (c) ways to enhance the quality,

utility, and clarity of the information collected; and (d) ways to

minimize the burden of collection of information on respondents,

including the use of automated collection techniques or other forms of

information technology.

OMB Approval Number: None.

Title: ``Telecommunications Reporting Worksheet and Associated

Requirements, CC Docket No. 98-171, NPRM''.

Form Number: FCC Form 499.

Type of Review: Proposed New Collection.

Respondents: Business or other for profit, including small

businesses.

Burden Estimate:

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Section/title Respondents Est. time per resp. Annual burden

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(1) Telecommunications:

Reporting Worksheet............. 5,000 6 hour...................... 30,000 hours.

(2) De minimis and Documenting

Procedures:

Recordkeeping Requirement....... 1000 .25......................... 250 hours.

(3) Notification Req................ 3000 .25......................... 750 hours.

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Frequency: On occasion; annual; semi-annual; third party

disclosures.

Total Annual Burden: 31,000 total hours.

Estimated Costs Per Respondent: Approximately $1.15.

Needs and Uses: The information collections for which approval is

sought would be used by the Commission and the administrators to

calculate contributions to the universal service support mechanisms,

the telecommunications relay services support mechanisms, the cost

recovery for numbering administration, and the cost recovery for the

shared costs of long-term local number portability. If the Commission

adopts its proposal in the Streamlined Contributor Reporting

Requirements NPRM, the proposed worksheet would replace four existing

forms and the information requested in the proposed worksheet would not

be otherwise available. Without such information, the Commission could

not determine contributions to the support and cost recovery mechanisms

and, therefore, could not fulfill its statutory responsibilities in

accordance with the Communications Act of 1934, as amended.

Summary of the Notice of Proposed Rulemaking

1. In the Notice of Proposed Rulemaking (NPRM) summarized here, we

propose to simplify the Commission's filing requirements so that a

single worksheet will replace several different forms currently filed

with similar information. Under our existing rules, different filing

and reporting requirements are associated with the Telecommunications

Relay Services (TRS) Fund,1 federal universal service

support mechanisms,2 the cost recovery mechanism for the

North American Numbering Plan (NANP) administration,3 and

the cost recovery mechanism for long-term local number portability

(LNP) administration.4 Carriers and certain other providers

of telecommunications services must satisfy these various requirements

by filing different forms or worksheets, containing similar but not

identical information, at different times, at different intervals, and

in different locations.

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\1\ 47 CFR 64.601 et seq.

\2\ 47 CFR 54.1 et seq., 69.1 et seq.

\3\ 47 CFR 52.1 et seq.

\4\ 47 CFR 52.21 et seq.

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2. Our existing multiple filing requirements impose real burdens on

affected parties--burdens that we can significantly reduce by combining

current contributor reporting worksheets into one unified

Telecommunications Reporting Worksheet. Besides benefiting reporting

entities, adopting a single worksheet also will reduce the public costs

of regulation by conserving Commission staff resources associated with

auditing and cross-checking data submissions. Such public cost

reductions benefit not only regulated parties and the Commission, but

American taxpayers generally. We initiate this proceeding and review of

our rules as part of our 1998 biennial review of regulations as

required by section 11 of the

[[Page 54092]]

Communications Act, as amended.5 Section 11 of the Act

requires us to review all of our regulations applicable to providers of

telecommunications services and determine whether any rule is no longer

in the public interest as the result of meaningful economic competition

between providers of telecommunications service.

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\5\ 47 USC 161. The Communications Act of 1934, as amended, (the

Communications Act or the Act) is codified at 47 USC 151 et seq.

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3. In order to facilitate introduction of a unified

Telecommunications Reporting Worksheet,6 we propose to: (1)

Adopt a uniform schedule and location for filing contribution data; (2)

encourage electronic filing of worksheets; (3) harmonize procedures for

future changes to the proposed Telecommunications Reporting Worksheet;

(4) authorize administrators to share contributor data in certain

circumstances; (5) alter the revenue basis for assessing contributions

to the TRS Fund and the NANP administration cost recovery mechanism;

and (6) revise the minimum contribution requirements of the TRS Fund

and the NANP administration cost recovery mechanism. In order to

accomplish these changes, we propose limited changes to our rules

7 governing the administration of the TRS Fund, the

administration of universal service support mechanisms, the cost

recovery for the NANP administration, and the cost recovery for local

number portability administration. Finally, we seek to further reduce

carrier filing burdens by allowing carriers to use the proposed

Telecommunications Reporting Worksheet to designate agents for service

of process pursuant to section 413 of the Communications Act of 1934,

as amended,8 as well as to satisfy the reporting

requirements of section 43.21(c) of our rules.9

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\6\ The proposed Telecommunications Reporting Worksheet and

accompanying instructions are attached to the Notice of Proposed

Rulemaking as Appendix B.

\7\ Proposed Rules are attached to the Notice of Proposed

Rulemaking as Appendix A.

\8\ 47 USC 413.

\9\ 47 CFR 43.21(c). The Commission's rules are codified at

Title 47 of the Code of Federal Regulations. 47 CFR 0.1 et seq.

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4. With the limited exceptions noted above, we do not seek to

revisit the substantive requirements of the four support and cost

recovery mechanisms, the class of contributors to each mechanism, or

the services whose revenues are included in contribution bases. Rather,

the rulemaking focuses on steps to reduce burdens on contributors by

improving the data collection process. In the Notice of Inquiry (NOI)

portion of the proceeding, we request broader public comment on the

feasibility and desirability of adopting other means to reduce

contributor burdens, including possible use of a single billing and

collection administrator for the TRS, universal service, NANP, and LNP

support and cost recovery mechanisms.

II. Consolidating Contributor Reporting Requirements

A. Telecommunications Reporting Worksheet

5. To consolidate collection of contribution data for the universal

service support mechanism, the TRS Fund, and the cost recovery

mechanisms for NANP and LNP administrations, we propose a unified

worksheet. The proposed Telecommunications Reporting Worksheet would

replace the existing worksheets, forms, or other methods of collecting

data for contributions to these support and cost recovery mechanisms,

and could be used by carriers to identify agents for service of process

as required by section 413 of the Act and to provide the revenue and

plant data required under Sec. 43.21(c) of the Commission's rules. We

ask commenters to address the desirability of this proposal and to

indicate whether such a unified worksheet would reduce the regulatory

and administrative burden on reporting carriers and providers of

telecommunications services. Alternatively, commenters should state

whether any of these cost recovery mechanisms would be better served

were we to continue collecting information through separate forms. We

seek detailed comment on whether the items, set out in our proposed

worksheet, are necessary and adequate to satisfy the underlying

regulatory requirements on which contributions are based.

6. We ask commenters to quantify any savings that would be realized

by these efforts to consolidate the data reporting process. We

encourage commenters to indicate whether there might be any class of

contributors whose burden would be increased by the combined worksheet.

In addition, we ask commenters to specify any information in our

proposed worksheet that is either unnecessary or duplicative, as well

as any information that is omitted from our proposal but that must be

obtained for one of the above purposes. We direct commenters to

consider whether any of the changes proposed below would alter existing

contracts with any respective administrators, such that the Commission

might need to revisit those contracts. In assessing the desirability of

this proposal, we ask commenters to state whether any potential risks

or problems might outweigh the benefits of this proposal.

B. Uniform Schedule and Location for Filing Contribution Data

7. In our view, the utility of a consolidated worksheet would be

significantly enhanced if carriers are able to file the form only once.

As required in the filing instructions of the existing worksheets,

currently contributors file the required worksheets at different times

of the year. While the adoption of a single Telecommunications

Reporting Worksheet makes possible a single filing date, we note that

the universal service rules require that contributors file twice a year

so that the Commission can develop contribution factors using

relatively current information. We do not propose to disturb this

procedure. Thus, carriers that are required to contribute to the

universal service support mechanisms will continue to be required to

file the new Telecommunications Reporting Worksheet on a semi-annual

basis, in accordance with 47 CFR 54.711(a). Carriers exempt from

contribution to the universal service support mechanism, but required

to file for other purposes, would only file once a year. We propose

that all carriers file the unified worksheet on April 1 of each year.

We observe that most firms have closed their books for the prior

calendar year in February or March. Thus, the April 1 date should allow

most reporting carriers to prepare their submissions using audited data

from closed books of account. While this would advance the date of

filing for TRS purposes, we do not believe that this change would

create a significant burden on contributors, particularly in light of

the expected benefits of a uniform worksheet. We seek comment on this

proposal. We also propose to revise the payment schedules for certain

mechanisms so that payments to the TRS Fund and the NANPA and LNPA cost

recovery mechanisms must be received by the first day of each month. If

we adopt the proposed form, the Commission will incorporate this

revised payment schedule when determining funding requirements and

developing contribution factors. We seek comment on this proposal.

C. Basis for Assessing Contributions

8. Contributions to each of the four support or cost recovery

mechanisms are based on some measure of revenue. In each case, carriers

or other contributors calculate the amount of

[[Page 54093]]

their contribution to a particular mechanism by determining their

proportion of a specified funding basis (or revenue basis). Under our

current rules, contributions to these mechanisms are not calculated

using the same funding basis. Thus, for example, contributions to the

universal service support mechanisms and the LNPA cost recovery are

based on the contributor's end-user telecommunications revenues. In

contrast, contributions to the TRS Fund are based on gross

telecommunications revenue and contributions to the NANPA cost recovery

are based on net telecommunications revenue.

9. Telecommunications Relay Services. Congress, in section 225 of

the Act, mandated that costs for interstate TRS be ``recovered from all

subscribers for every interstate service.'' The Commission, in the TRS

Third Report and Order, concluded that recovering interstate relay

costs from all common carriers that provide interstate service on the

basis of their gross interstate revenues would satisfy the statutory

directive in section 225. As discussed below, the Commission considered

basing TRS contribution on end-user telecommunications revenues, but,

for reasons that we now reconsider, declined to adopt that revenue

basis. Thus, contributions to the TRS Fund currently are made on the

basis of the contributor's relative share of gross interstate

telecommunications revenues.

10. In light of the Commission's experience since the TRS Third

Report and Order, we propose to change the revenue basis for the TRS

Fund, so that contributors will base their contribution on end-user

telecommunications revenue, instead of gross telecommunications

revenue. We believe that basing contributions on an end-user

telecommunications revenue basis is consistent with the statutory

language of section 225 and its requirement that ``costs caused by

interstate telecommunications relay services shall be recovered from

all subscribers for every interstate service.'' The Commission has

previously defined the term ``end-user telecommunications revenues'' to

include not only all revenues from end-users, but also revenues derived

from other sources, such as subscriber lines charges and revenues

collected from carriers that purchase telecommunications services for

their own internal use. We tentatively conclude that basing

contributions to the TRS Fund on end-user telecommunications revenue

will effectively carry out the mandate in section 225 that ``all

subscribers'' of interstate services bear the cost of funding the

interstate telecommunications relay services. We recognize that the TRS

Fund administrator must collect and validate more data to administer

contributions based on end-user telecommunications revenue, compared

with contributions based on gross telecommunications revenue; however,

this additional data will already be on the combined worksheet and

therefore should represent little, if any, added burden to either

contributors or the administrator. We seek comment on this tentative

conclusion.

11. North American Numbering Plan Administration. In the case of

NANPA cost recovery, section 251(e) of the Act directs that ``[t]he

cost of establishing telecommunications numbering administration

arrangements and number portability shall be borne by all

telecommunications carriers on a competitively neutral basis as

determined by the Commission.'' The Commission, in the Local

Competition Second Report and Order, required all telecommunications

carriers to base their contributions to the NANPA cost recovery

mechanism on net telecommunications revenues. That is, contributors

must subtract from their gross telecommunications services revenues

expenditures for all telecommunications services and facilities that

had been paid to other telecommunications carriers. As described above,

the Commission subsequently determined in the Universal Service Order

that both a net telecommunications revenue basis, as currently used in

numbering administration cost recovery, and an end-user

telecommunications revenue basis, as used to calculate contributions

for the universal service support mechanisms, are competitively

neutral. The Commission opted to base contributions to the universal

service support mechanisms on an end-user telecommunications revenues

basis at least in part on the finding that calculating end-user

telecommunications revenue would be more administratively efficient for

reporting carriers and telecommunications providers.

12. On the basis of the analysis contained in the Universal Service

Order, we reconsider our earlier decision and tentatively conclude that

we should adopt an end-user telecommunications revenue basis for the

purposes of NANPA cost recovery mechanism. We believe that an end-user

telecommunications revenue basis would satisfy the requirement in

section 251(e) that telecommunications carriers contribute to the NANPA

cost recovery mechanism on a competitively neutral basis. Because

section 251(e)(2) requires that we select a competitively neutral basis

for contributions, but specifies no other criteria that must be used in

the selection, we tentatively conclude that we have discretion under

the statute to choose among competitively neutral mechanisms based upon

other valid regulatory goals, such as administrative efficiency. We

seek comment on this tentative conclusion.

D. Minimum and Fixed Annual Contributions to NANPA and TRS Mechanisms

13. We propose to revise our current requirements for minimum

annual contributions by telecommunications carriers to the NANPA cost

recovery. We propose a two-part structure for determining minimum

contributions. We propose that telecommunications carriers with no end-

user telecommunications revenues make a fixed contribution of one

hundred dollars ($100) per year to the NANPA cost recovery mechanism.

We tentatively conclude that this proposal satisfies the statutory

language in section 251(e)(2) that the ``cost of establishing

telecommunications numbering administration arrangements * * * shall be

borne by all telecommunications carriers on a competitively neutral

basis * * *.''

14. For those telecommunications carriers with any end-user

telecommunications revenues, we propose to eliminate the minimum

contribution rule because we are not certain that this amount is

necessary to support the administrative costs of processing the

worksheet and because of our desire to minimize burdens on the smallest

carriers. Thus, we propose that these carriers simply calculate what

they owe under our contribution formula and remit that amount, even if

that amount is less than one hundred dollars ($100). We revisit, in the

NPRM, the NANP Billing and Collection Agent's earlier decision

regarding minimum contributions based on our experience with the NANPA

and TRS mechanisms. We expect the administrative cost to process the

NANPA worksheet to be less than one hundred dollars ($100) per

worksheet. We further anticipate that the actions proposed here to

streamline the contributor reporting process, particularly our

proposals regarding electronic filing and sharing of information

between administrators, will reduce administrative costs to process

these worksheets. We seek comment about whether the costs to process

this worksheet justify a

[[Page 54094]]

mandatory minimum contribution for the purposes of NANPA, other than

that fixed contribution described above for carriers with no end-user

telecommunications revenue.

15. Telecommunications Relay Services. Pursuant to

Sec. 64.604(c)(4)(iii) of the Commission's rules, every carrier

providing interstate telecommunications services ``must contribute at

least $100 per year.'' The Commission adopted this minimum contribution

to maintain an ``efficiency of administration.''

16. We propose to eliminate the one hundred dollar ($100) minimum

contribution rule as applied to the TRS Fund. Under our proposal,

subject carriers (i.e., those providing interstate telecommunications

services) would simply calculate what they owe under our contribution

formula and remit that amount. Our experience with the TRS Fund and the

NANPA cost recovery mechanism has indicated that, under our current

rules, many small carriers are required to make a minimum contribution

that is disproportionately large based on their total

telecommunications revenues. We believe that this proposed change will

provide a significant benefit to small telecommunications carriers. We

realize that in the rarest instances the amount of a carrier's

contribution may actually be smaller than the cost to process the

application. We believe, however, that this inefficiency is outweighed

by the benefits received by small carriers. We seek comment on this

proposal.

E. Procedures for Future Changes to the Telecommunications Reporting

Worksheet

17. We propose to delegate authority to make future changes to the

Telecommunications Reporting Worksheet to the Chief of the Common

Carrier Bureau. Should we adopt our proposal to combine the TRS Fund,

NANP administration, LNP administration, and universal service support

mechanism worksheets into one unified worksheet, it would be important

to have a single, predetermined procedure for altering that worksheet.

We believe that such changes will be necessary as an ordinary matter.

For example, for the purposes of both the TRS Fund and the NANPA cost

recovery, the Commission will need to revise the payment formulas on

which contributions are based for each year. We believe it unnecessary

for the Commission to review changes to the Telecommunications

Reporting Worksheet that relate to these payment formulas or other

ministerial tasks. Thus, we propose to amend our rules for the TRS

Fund, NANP administration, LNP administration, and universal service

support mechanisms, to include a specific delegation of authority to

the Chief of the Common Carrier Bureau to make certain future changes

to the combined worksheet. We seek comment on this proposal.

F. Authorize Sharing of Information Between Administrators

18. We propose to permit the sharing of billing and collection

information between the TRS, universal service, NANP, and LNP

administrators. This proposal would permit administrators to cross-

check filed data and collection information where contributors are

required to file for more than one purpose. We tentatively conclude

that the administrators will benefit significantly from this

flexibility. This proposal should reduce audit costs dramatically and

should increase greatly the reliability of data on which contributions

to these mechanisms are based. As an additional benefit, we also

contemplate that this proposal might allow administrators to delegate

certain functions, such that, e.g., one administrator might fulfill

data entry and verification functions for more than one mechanism. At

the same time, we propose to limit such sharing arrangements so as to

ensure that proprietary information is not used for any improper

purpose. Our proposed rule language would require that such agreements

be approved by the Chief of the Common Carrier Bureau. We seek comment

on this proposal.

19. We further propose, as currently allowed under the Universal

Service Worksheet, to permit carriers filing the Telecommunications

Reporting Worksheet to certify that the revenue data contained in their

submissions are privileged or confidential commercial or financial

information and that disclosure of such information would likely cause

substantial harm to the competitive position of the entity filing the

worksheet. Carriers would be able to make this certification on their

Telecommunications Reporting Worksheet and request Commission

nondisclosure of information contained in the worksheet by checking a

box on the Worksheet, in lieu of submitting a separate request pursuant

to Sec. 0.459 of the Commission's rules. If the Commission receives a

request for or proposes to disclose the information, the carrier would

be required, of course, to make the full showing that our rules require

in a request for withholding from public inspection information

submitted to the Commission. All sharing arrangements entered into

among administrators would have to provide that the administrators will

comply with requests for confidential treatment of their data. We seek

comment on this proposal.

G. Electronic Filing

20. We propose to require the administrators to provide for and

encourage electronic filing of the consolidated form. Electronic filing

reduces data entry expenses for the administrator, reduces confusion,

and might allow some mistakes to be detected before carriers file data.

We anticipate that the administrators would be able to develop an

electronic filing package that assists carriers with the compilation of

data, calculation of totals and contribution amounts, and that provides

contextual help. Such a package would greatly reduce the filing burden

on small carriers and would greatly reduce data entry and validation

costs for the administrators. We expect that electronic filing would

reduce burdens on reporting carriers because they would be able to work

from the electronic copy of their prior year's filing and modify only

the information that has changed, rather than reentering all of the

information for every filing. Also, we envision that electronic filing

software could eventually calculate TRS, NANPA, and LNPA contributions

for the filers. We note that this proposal is consistent with the

directives of the Office of Management and Budget (OMB).

21. We expect that any transition to an electronic filing system

would require considerable coordination between the administrators, the

telecommunications industry, and the Commission. We note that the

technical details of how electronic filing is accomplished can be

complex and expensive for both the administrators and reporting

carriers. We seek comment on the nature and extent of these

administrative costs. We seek specific recommendations on the

appropriate time frame for development of electronic filing mechanisms

and we ask commenters to consider any increased burden on the

administrators and whether the Commission might need to adjust existing

contracts with administrators to provide for this function.

22. In addition, we are committed to making electronic filing and

other electronic applications accessible to persons with disabilities

to the fullest extent possible. We note that electronic filing is

subject to program accessibility requirements of section 1.850 of our

rules. In addition Congress has revised the requirements for access by

persons with disabilities to federal information

[[Page 54095]]

technology programs in the Workforce Investment Act of

1998.10 We recognize that, in some instances, it may be

difficult for persons with disabilities to access components of the

proposed electronic filing. In particular, the accessibility of forms

and certain types of electronic files raises complex technical issues.

We will continue to work on these issues and fully expect that with

advances in technology, we will be able to enhance the accessibility to

persons with disabilities.

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\10\ Workforce Investment Act of 1998, Pub. L. 105-220, 112

Stat. 936 (Aug. 7, 1998). Section 508 of the Act provides that

persons with disabilities and non-disabled persons must have

comparable access and ability to use technology and electronic

information, and federal agencies must take steps to ensure such

comparable access for persons with disabilities unless an undue

burden would be imposed. If an undue burden would be imposed, the

agency must provide an alternative means of access that allows for

persons with disabilities to access and use the information.

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III. Notice of Inquiry

23. We issue the Notice of Inquiry to investigate additional steps

we could take that might allow us to further rationalize the

contribution mechanisms currently in place and reduce filing burdens on

parties. We invite commenters to bring to our attention any such

suggestions that would reduce burdens and maximize the efficiency of

the contributor reporting requirements process, while maintaining

accuracy and accountability in the administration of the mechanisms. In

particular, we ask commenters to consider whether the Commission should

consolidate all billing and collection functions for the four support

and cost recovery mechanisms with a single agent. Under such a plan, a

single billing and collection agent would have no responsibilities over

the administration of the TRS Fund, the maintenance of universal

service, the administration of numbering resources, or the maintenance

of local number portability databases. A billing and collection agent

would be charged with efficiently collecting contributions from all

subject contributors.

24. We note that the Commission has taken other actions to promote

efficiency and accountability in administration of the support and cost

recovery mechanisms. For example, in the universal service proceeding,

the Commission recently proposed that a single entity, USAC, administer

universal service support for rural health care providers and schools

and libraries, as well as the high cost and low income support

mechanisms. We ask commenters to consider whether adoption of a single

agent to perform billing and collection functions on a consolidated

basis for the four support and cost recovery mechanisms would reduce

administrative costs, lead to greater accountability, and promote the

efficient and effective administration of the support and cost recovery

mechanisms. In the NPRM, we ask parties to address a number of specific

questions related to this proposal.

IV. Procedural Matters

A. Initial Paperwork Reduction Act Analysis

25. The Notice of Proposed Rulemaking contains a proposal to reduce

existing information collections. As part of our continuing effort to

reduce paperwork burdens, we invite the general public and the Office

of Management and Budget (OMB) to take this opportunity to comment on

the proposals contained in the Notice of Proposed Rulemaking, as

required by the Paperwork Reduction Act of 1995, Pub. L. 104-13. Public

and agency comments are due at the same time as other comments on the

Notice of Proposed Rulemaking; OMB comments are due 60 days from the

date of the publication of this summary of the Notice of Proposed

Rulemaking in the Federal Register. Comments should address: (a)

whether the proposed collection of information is necessary for the

proper performance of the functions of the Commission, including

whether the information shall have practical utility; (b) the accuracy

of the Commission's burden estimates; (c) ways to enhance the quality,

utility, and clarity of the information collected; and (d) ways to

minimize the burden of collection of information on respondents,

including the use of automated collection techniques or other forms of

information technology.

B. Initial Regulatory Flexibility Act Analysis

26. As required by the Regulatory Flexibility Act

(RFA),11 the Commission has prepared an Initial Regulatory

Flexibility Analysis (IRFA) of the possible significant economic impact

on small entities of the policies and rules proposed in the NPRM. A

copy of the IRFA is attached to this summary. Written public comments

are requested with respect to the IRFA. These comments must be filed in

accordance with the same filing deadlines for comments on the rest of

the NPRM and they must have a separate and distinct heading,

designating the comments as responses to the IRFA. The Office of Public

Affairs, Reference Operations Division, will send a copy of the NPRM

and Notice of Inquiry, including the IRFA, to the Chief Counsel for

Advocacy of the Small Business Administration.

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\11\ See 5 U.S.C. 603. The RFA, see 5 U.S.C. 601 et. seq., has

been amended by the Contract With America Advancement Act of 1996,

Public Law 104-121, 110 Stat. 847 (1996) (CWAAA). Title II of the

CWAAA is the Small Business Regulatory Enforcement Fairness Act of

1996 (SBREFA).

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C. Ex Parte Presentations

27. This proceeding will be treated as a ``permit-but-disclose''

proceeding subject to the ``permit-but-disclose'' requirements under

Sec. 1.1206 of the Commission's rules, as revised.12

Additional rules pertaining to oral and written presentations are set

forth in section 1.1206.

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\12\ 47 CFR 1.1206.

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D. Comment Filing Procedures

28. General. Pursuant to Secs. 1.415 and 1.419 of the Commission's

rules, 47 CFR 1.415, 1.419, interested parties may file comments on

before October 30, 1998, and reply comments on or before November 16,

1998. Comments may be filed using the Commission's Electronic Comment

Filing System (ECFS) or by filing paper copies.

29. Comments filed through the ECFS can be sent as an electronic

file via the Internet to http://www.fcc.gov/e-file/ecfs.html>.

Generally, only one copy of an electronic submission must be filed. If

multiple docket or rulemaking numbers appear in the caption of this

proceeding, however, commenters must transmit one electronic copy of

the comments to each docket or rulemaking number referenced in the

caption. In completing the transmittal screen, commenters should

include their full name, Postal Service mailing address, and the

applicable docket or rulemaking number. Parties may also submit an

electronic comment by Internet e-mail. To get filing instructions for

e-mail comments, commenters should send an e-mail to [email protected], and

should include the following words in the body of the message, ``get

form .'' A sample form and directions will be sent

in reply.

30. Parties who choose to file by paper must file an original and

four copies of each filing. If more than one docket or rulemaking

number appear in the caption of this proceeding, commenters must submit

two additional copies for each additional docket or rulemaking number.

All filings must be sent to the Commission's Secretary, Magalie Roman

Salas, Office of the Secretary, Federal Communications Commission, 1919

M St. NW, Room 222, Washington, DC 20554, with a copy

[[Page 54096]]

to: Scott K. Bergmann, Common Carrier Bureau, Industry Analysis

Division, 2033 M Street, NW, Room 500, Washington, DC 20554.

31. Parties who choose to file by paper should also submit their

comments on diskette. These diskettes should be submitted to: Ms. Terry

Conway, Common Carrier Bureau, Industry Analysis Division, 2033 M

Street, NW, Room 500, Washington, DC 20554. Such a submission should be

on a 3.5 inch diskette formatted in an IBM compatible format using

WordPerfect 5.1 for Windows or compatible software. The diskette should

be accompanied by a cover letter and should be submitted in ``read

only'' mode. The diskette should be clearly labelled with the

commenter's name, proceeding (including the lead docket number in this

case (CC Docket No. 98-171)), type of pleading (comment or reply

comment), date of submission, and the name of the electronic file on

the diskette. The label should also include the following phrase ``Disk

Copy--Not an Original.'' Each diskette should contain only one party's

pleadings, preferably in a single electronic file. In addition,

commenters must send diskette copies to the Commission's copy

contractor, International Transcription Service, Inc., 1231 20th

Street, NW, Washington, DC 20037.

List of Subjects

47 CFR Parts 1 and 43

Communications common carriers, Reporting and recordkeeping

requirements, Telecommunications, Telephone.

47 CFR Part 52

Communications common carriers, Numbering administration, Number

portability, Reporting and recordkeeping requirements,

Telecommunications, Telephone.

47 CFR Part 54

Communications common carriers, Reporting and recordkeeping

requirements, Telecommunications, Telephone, Universal service.

47 CFR Part 64

Communications common carriers, Reporting and recordkeeping

requirements, Telecommunications, Telecommunications relay services,

Telephone.

Federal Communications Commission.

Magalie Roman Salas,

Secretary.

Attachment--Initial Regulatory Flexibility Act Analysis

1. As required by the Regulatory Flexibility Act

(RFA),1 the Commission has prepared an Initial Regulatory

Flexibility Analysis (IRFA) of the possible significant economic

impact on small entities by the policies and rules proposed in the

NPRM. Written public comments are requested on the IRFA. Comments

must be identified as responses to the IRFA and must be filed by the

deadlines for comments on the NPRM provided above on the first page.

The Commission will send a copy of the NPRM, including the IRFA, to

the Chief Counsel for Advocacy of the Small Business

Administration.2

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\1\ See 5 U.S.C. 603. The RFA, see 5 U.S.C. 601 et. seq., has

been amended by the Contract With America Advancement Act of 1996,

Pub. L. 104-121, 110 Stat. 847 (1996) (CWAAA). Title II of the CWAAA

is the Small Business Regulatory Enforcement Fairness Act of 1996

(SBREFA).

\2\ See 5 U.S.C. 603(a).

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I. Need for, and Objectives of, the Proposed Action

2. The Commission undertakes this examination of its contributor

reporting requirements 3 as a part of its 1998 biennial

review of regulations as required by section 11 of the

Communications Act, as amended.4 The NPRM proposes to

simplify the Commission's filing requirements so that a single

worksheet will replace several different forms currently filed under

our existing rules associated with the Telecommunications Relay

Services (TRS) Fund,5 federal universal service support

mechanisms,6 the cost recovery mechanism for the North

American Numbering Plan (NANP) administration,7 and the

cost recovery mechanism for long-term local number portability (LNP)

administration.8 Our objective is to reduce or eliminate

unnecessary or duplicative regulatory requirements as competition

supplants the need for such requirements, consistent with section 11

of the Communications Act, as amended,9 and the

Telecommunications Act of 1996.10 The Commission

tentatively concludes that it can reduce regulatory burdens imposed

by the existing multiple filing requirements by combining current

contributor reporting worksheets into one unified Telecommunications

Reporting Worksheet.

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\3\ See 47 CFR 64.601 et seq.; 47 CFR 54.1 et seq.; 47 CFR 52.1

et seq.; 47 CFR 52.21 et seq.

\4\ 47 U.S.C. 161.

\5\ 47 CFR 64.601 et seq.

\6\ 47 CFR 54.1 et seq., 69.1 et seq.

\7\ 47 CFR 52.1 et seq.

\8\ 47 CFR 52.21 et seq.

\9\ 47 U.S.C. 161.

\10\ Telecommunications Act of 1996, Pub. L. 104-104, 110 Stat.

56 (1996 Act), codified at 47 U.S.C. 151 et seq. See Joint

Explanatory Statement of the Committee of Conference, S. Conf. Rep.

No. 230, 104th Cong., 2d Sess. 113 (1996) (Joint Explanatory

Statement).

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II. Legal Basis

3. The legal basis for the action as proposed for this

rulemaking is contained in sections 1, 4(i), 4(j), 11, 201-205, 210,

214, 218, 225, 251, 254, 303(r), 332, and 403 of the Communications

Act of 1934, as amended, 47 U.S.C. 151, 154(i), 154(j), 161, 201-

205, 210, 214, 218, 225, 251, 254, 303(r), 332 and 403.

III. Description and Estimate of the Number of Small Entities to

Which the Proposed Action May Apply

4. The Commission's contributor reporting requirements apply to

a wide rage of entities, including all telecommunications carriers

and other providers of interstate telecommunications that offer

telecommunications for a fee.11 Thus, we expect that the

proposals set forth in this proceeding may have an economic impact

on a substantial number of small entities. The economic impact of

these proposals would, of course, be a positive and beneficial

impact, in the form of reduced regulatory burdens and recordkeeping

requirements, for these entities.

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\11\ 47 CFR 52.17 (applying to all telecommunications carriers),

52.32 (applying to all telecommunications carriers), 54.703

(applying to every telecommunications carrier that provides

interstate telecommunications services, every provider of interstate

telecommunications that offers telecommunications for a fee on a

non-common carrier basis, and certain payphone providers),

64.604(c)(4)(iii)(A) (applying to every carrier providing interstate

telecommunications services). We note that the Commission's rules

for universal service exempt certain small contributors, i.e.,

contributors that have revenue below a stated threshold. 47 CFR

54.705.

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5. To estimate the number of small entities that would benefit

from this positive economic impact, we first consider the statutory

definition of ``small entity'' under the RFA. The RFA generally

defines ``small entity'' as having the same meaning as the term

``small business,'' ``small organization,'' and ``small governmental

jurisdiction.'' 12 In addition, the term ``small

business'' has the same meaning as the term ``small business

concern'' under the Small Business Act, unless the Commission has

developed one or more definitions that are appropriate to its

activities.13 Under the Small Business Act, a ``small

business concern'' is one that: (1) Is independently owned and

operated; (2) is not dominant in its field of operation; and (3)

meets any additional criteria established by the Small Business

Administration (SBA).14 The SBA has defined a small

business for Standard Industrial Classification (SIC) categories

4812 (Radiotelephone

[[Page 54097]]

Communications) and 4813 (Telephone Communications, Except

Radiotelephone) to be small entities when they have no more than

1,500 employees.15 We first discuss the number of small

telephone companies falling within these SIC categories, then

attempt to refine further those estimates to correspond with the

categories of telephone companies that are commonly used under our

rules. We expect that not all of the entities within a given

category necessarily offer carrier services or interstate

telecommunications services for a fee. Nevertheless, out of an

abundance of caution, we analyze a wide range of categories in an

effort to identify the greatest number of small entities possible

that could be effected by the proposals in the NPRM.

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\12\ 5 U.S.C. 601(6).

\13\ 5 U.S.C. 601(3) (incorporating by reference the definition

of ``small business concern'' in 5 U.S.C. 632). Pursuant to 5 U.S.C.

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

``unless an agency after consultation with the Office of Advocacy of

the Small Business Administration and after opportunity for public

comment, establishes one or more definitions of such term which are

appropriate to the activities of the agency and publishes such

definition in the Federal Register.''

\14\ 15 U.S.C. 632. See, e.g., Brown Transport Truckload, Inc.

v. Southern Wipers, Inc., 176 B.R. 82 (N.D. Ga. 1994).

\15\ 13 CFR 121.201.

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6. The most reliable source of information regarding the total

numbers of certain common carrier and related providers nationwide,

as well as the numbers of commercial wireless entities, appears to

be data the Commission publishes annually in its Telecommunications

Industry Revenue report, regarding the Telecommunications Relay

Service (TRS).16 According to data in the most recent

report, there are 3,459 interstate carriers.17 These

carriers include, inter alia, local exchange carriers, wireline

carriers and service providers, interexchange carriers, competitive

access providers, operator service providers, pay telephone

operators, providers of telephone toll service, providers of

telephone exchange service, and resellers.

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\16\ FCC, Telecommunications Industry Revenue: TRS Fund

Worksheet Data, Figure 2 (Number of Carriers Paying Into the TRS

Fund by Type of Carrier) (Nov. 1997) (Telecommunications Industry

Revenue).

\17\ Id.

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7. Although some affected incumbent local exchange carriers

(ILECs) may have 1,500 or fewer employees, we do not believe that

such entities should be considered small entities within the meaning

of the RFA because they are either dominant in their field of

operations or are not independently owned and operated, and

therefore by definition not ``small entities'' or ``small business

concerns'' under the RFA. Accordingly, our use of the terms ``small

entities'' and ``small businesses'' does not encompass small ILECs.

Out of an abundance of caution, however, for regulatory flexibility

analysis purposes, we will separately consider small ILECs within

this analysis and use the term ``small ILECs'' to refer to any ILECs

that arguably might be defined by the SBA as ``small business

concerns.'' 18

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\18\ See 13 CFR 121.201, SIC Code 4813. Since the time of the

Commission's 1996 decision, Implementation of the Local Competition

Provisions in the Telecommunications Act of 1996, First Report and

Order, 11 FCC Rcd 15499, 16144-45 (1996), 61 FR 45476 (August 29,

1996), the Commission has consistently addressed in its regulatory

flexibility analyses the impact of its rules on such ILECs.

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8. Total Number of Telephone Companies Affected. The United

States Bureau of the Census (``the Census Bureau'') reports that, at

the end of 1992, there were 3,497 firms engaged in providing

telephone services, as defined therein, for at least one

year.19 This number contains a variety of different

categories of carriers, including local exchange carriers,

interexchange carriers, competitive access providers, cellular

carriers, mobile service carriers, operator service providers, pay

telephone operators, PCS providers, covered SMR providers, and

resellers. It seems certain that some of those 3,497 telephone

service firms may not qualify as small entities or small incumbent

LECs because they are not ``independently owned and operated.''

20 For example, a PCS provider that is affiliated with an

interexchange carrier having more than 1,500 employees would not

meet the definition of a small business. It seems reasonable to

conclude, therefore, that fewer than 3,497 telephone service firms

are small entity telephone service firms or small incumbent LECs

that may be affected by the NPRM.

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\19\ United States Department of Commerce, Bureau of the Census,

1992 Census of Transportation, Communications, and Utilities:

Establishment and Firm Size, at Firm Size 1-123 (1995) (1992

Census).

\20\ 15 U.S.C. 632(a)(1).

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9. Wireline Carriers and Service Providers. SBA has developed a

definition of small entities for telephone communications companies

other than radiotelephone companies. The Census Bureau reports that,

there were 2,321 such telephone companies in operation for at least

one year at the end of 1992.21 According to SBA's

definition, a small business telephone company other than a

radiotelephone company is one employing no more than 1,500

persons.22 All but 26 of the 2,321 non-radiotelephone

companies listed by the Census Bureau were reported to have fewer

than 1,000 employees. Thus, even if all 26 of those companies had

more than 1,500 employees, there would still be 2,295 non-

radiotelephone companies that might qualify as small entities or

small incumbent LECs. Although it seems certain that some of these

carriers are not independently owned and operated, we are unable at

this time to estimate with greater precision the number of wireline

carriers and service providers that would qualify as small business

concerns under SBA's definition. Consequently, we estimate that

there are fewer than 2,295 small entity telephone communications

companies other than radiotelephone companies that may be affected

by the proposals recommended for adoption in the NPRM.

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

\21\ 1992 Census, supra, at Firm Size 1-123.

\22\ 13 CFR 121.201, SIC Code 4813.

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

10. Local Exchange Carriers. Neither the Commission nor SBA has

developed a definition of small providers of local exchange services

(LECs). The closest applicable definition under SBA rules is for

telephone communications companies other than radiotelephone

(wireless) companies. The most reliable source of information

regarding the number of LECs nationwide of which we are aware

appears to be the data that we collect annually in connection with

the Telecommunications Relay Service (TRS).23 According

to our most recent data, 1,371 companies reported that they were

engaged in the provision of local exchange services.24

Although it seems certain that some of these carriers are not

independently owned and operated, or have more than 1,500 employees,

we are unable at this time to estimate with greater precision the

number of LECs that would qualify as small business concerns under

SBA's definition. Consequently, we estimate that there are fewer

than 1,371 small entity LECs or small incumbent LECs that may be

affected by the proposals recommended for adoption in the NPRM.

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

\23\ See 47 CFR 64.601 et seq.

\24\ Telecommunications Industry Revenue at Fig. 2.

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

11. Interexchange Carriers. Neither the Commission nor SBA has

developed a definition of small entities specifically applicable to

providers of interexchange services (IXCs). The closest applicable

definition under SBA rules is for telephone communications companies

other than radiotelephone companies.25 The most reliable

source of information regarding the number of IXCs nationwide of

which we are aware appears to be the data that we collect annually

in connection with TRS. According to our most recent data, 143

companies reported that they were engaged in the provision of

interexchange services.26 Although it seems certain that

some of these carriers are not independently owned and operated, or

have more than 1,500 employees, we are unable at this time to

estimate with greater precision the number of IXCs that would

qualify as small business concerns under SBA's definition.

Consequently, we estimate that there are fewer than 143 small entity

IXCs that may be affected by the proposals recommended for adoption

in the NPRM.

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\25\ 13 CFR 121.210, SIC Code 4813.

\26\ Telecommunications Industry Revenue at Fig. 2.

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

12. Competitive Access Providers. Neither the Commission nor SBA

has developed a definition of small entities specifically applicable

to providers of competitive access services (CAPs). The closest

applicable definition under SBA rules is for telephone

communications companies other than radiotelephone companies. The

most reliable source of information regarding the number of CAPs

nationwide of which we are aware appears to be the data that we

collect annually in connection with the TRS. According to our most

recent data, 109 companies reported that they were engaged in the

provision of competitive access services.27 Although it

seems certain that some of these carriers are not independently

owned and operated, or have more than 1,500 employees, we are unable

at this time to estimate with greater precision the number of CAPs

that would qualify as small business concerns under SBA's

definition. Consequently, we estimate that there are fewer than 109

small entity CAPs that may be affected by the proposals recommended

for adoption in the NPRM.

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\27\ Telecommunications Industry Revenue at Fig. 2.

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

13. Operator Service Providers. Neither the Commission nor SBA

has developed a definition of small entities specifically applicable

to providers of operator services.

[[Page 54098]]

The closest applicable definition under SBA rules is for telephone

communications companies other than radiotelephone companies. The

most reliable source of information regarding the number of operator

service providers nationwide of which we are aware appears to be the

data that we collect annually in connection with the TRS. According

to our most recent data, 27 companies reported that they were

engaged in the provision of operator services.28 Although

it seems certain that some of these companies are not independently

owned and operated, or have more than 1,500 employees, we are unable

at this time to estimate with greater precision the number of

operator service providers that would qualify as small business

concerns under SBA's definition. Consequently, we estimate that

there are fewer than 27 small entity operator service providers that

may be affected by the proposals recommended for adoption in the

NPRM.

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

\28\ Telecommunications Industry Revenue at Fig. 2.

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

14. Resellers. Neither the Commission nor SBA has developed a

definition of small entities specifically applicable to resellers.

The closest applicable definition under SBA rules is for all

telephone communications companies.29 The most reliable

source of information regarding the number of resellers nationwide

of which we are aware appears to be the data that we collect

annually in connection with the TRS. According to our most recent

data, 339 companies reported that they were engaged in the resale of

telephone services.30 Although it seems certain that some

of these carriers are not independently owned and operated, or have

more than 1,500 employees, we are unable at this time to estimate

with greater precision the number of resellers that would qualify as

small business concerns under SBA's definition. Consequently, we

estimate that there are fewer than 339 small entity resellers that

may be affected by the proposals recommended for adoption in the

NPRM.

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\29\ 13 CFR 121.210, SIC Code 4813.

\30\ Telecommunications Industry Revenue at Fig. 2.

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

15. Wireless (Radiotelephone) Carriers. SBA has developed a

definition of small entities for radiotelephone (wireless)

companies. The Census Bureau reports that there were 1,176 such

companies in operation for at least one year at the end of

1992.31 According to SBA's definition, a small business

radiotelephone company is one employing no more than 1,500

persons.32 The Census Bureau also reported that 1,164 of

those radiotelephone companies had fewer than 1,000 employees. Thus,

even if all of the remaining 12 companies had more than 1,500

employees, there would still be 1,164 radiotelephone companies that

might qualify as small entities if they are independently owned and

operated. Although it seems certain that some of these carriers are

not independently owned and operated, we are unable at this time to

estimate with greater precision the number of radiotelephone

carriers and service providers that would qualify as small business

concerns under SBA's definition. Consequently, we estimate that

there are fewer than 1,164 small entity radiotelephone companies

that may be affected by the proposals recommended for adoption in

the NPRM.

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\31\ 1992 Census, supra, at Firm Size 1-123.

\32\ 13 CFR 121.201, SIC Code 4812.

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

16. Cellular and Mobile Service Carriers. In an effort to

further refine our calculation of the number of radiotelephone

companies affected by the rules adopted herein, we consider the

categories of radiotelephone carriers, Cellular Service Carriers and

Mobile Service Carriers. Neither the Commission nor the SBA has

developed a definition of small entities specifically applicable to

Cellular Service Carriers and to Mobile Service Carriers. The

closest applicable definition under SBA rules for both services is

for telephone companies other than radiotelephone (wireless)

companies.33 The most reliable source of information

regarding the number of Cellular Service Carriers and Mobile Service

Carriers nationwide of which we are aware appears to be the data

that we collect annually in connection with the TRS. According to

our most recent data, 804 companies reported that they are engaged

in the provision of cellular services and 117 companies reported

that they are engaged in the provision of mobile

services.34 Although it seems certain that some of these

carriers are not independently owned and operated, or have more than

1,500 employees, we are unable at this time to estimate with greater

precision the number of Cellular Service Carriers and Mobile Service

Carriers that would qualify as small business concerns under SBA's

definition. Consequently, we estimate that there are fewer than 804

small entity Cellular Service Carriers and fewer than 138 small

entity Mobile Service Carriers that might be affected by the

proposals recommended for adoption in the NPRM.

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\33\ Id.

\34\ Telecommunications Industry Revenue at Fig. 2.

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

17. Broadband PCS Licensees. The broadband PCS spectrum is

divided into six frequency blocks designated A through F, and the

Commission has held auctions for each block. The Commission defined

``small entity'' for Blocks C and F as an entity that has average

gross revenues of less than $40 million in the three previous

calendar years. For Block F, an additional classification for ``very

small business'' was added, and is defined as an entity that,

together with its affiliates, has average gross revenues of not more

than $15 million for the preceding three calendar

years.35 These regulations defining ``small entity'' in

the context of broadband PCS auctions have been approved by

SBA.36 No small businesses within the SBA-approved

definition bid successfully for licenses in Blocks A and B. There

were 90 winning bidders that qualified as small entities in the

Block C auctions. A total of 93 small and very small business

bidders won approximately 40% of the 1,479 licenses for Blocks D, E,

and F. However, licenses for Blocks C through F have not been

awarded fully, therefore there are few, if any, small businesses

currently providing PCS services. Based on this information, we

conclude that the number of small broadband PCS licenses will

include the 90 winning C Block bidders and the 93 qualifying bidders

in the D, E, and F blocks, for a total of 183 small PCS providers as

defined by the SBA and the Commissioner's auction rules.

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\35\ Id., at para. 60.

\36\ Implementation of Section 309(j) of the Communications

Act--Competitive Bidding, PP Docket No. 93-253, Fifth Report and

Order, 9 FCC Rcd 5532, 5581-84 (1994).

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18. SMR Licensees. Pursuant to 47 CFR 90.814(b)(1), the

Commission has defined ``small entity'' in auctions for geographic

area 800 MHz and 900 MHz SMR licenses as a firm that had average

annual gross revenues of less than $15 million in the three previous

calendar years. The definition of a ``small entity'' in the context

of 800 MHz SMR has been approved by the SBA,37 and

approval for the 900 MHz SMR definition has been sought. The rules

proposed in the NPRM may apply to SMR providers in the 800 MHz and

900 MHz bands that either hold geographic area licenses or have

obtained extended implementation authorizations. We do not know how

many firms provide 800 MHz or 900 MHz geographic area SMR service

pursuant to extended implementation authorizations, nor how many of

these providers have annual revenues of less than $15 million. We

assume, for purposes of this IRFA, that all of the extended

implementation authorizations may be held by small entities, that

may be affected by the proposals recommended for adoption in the

NPRM.

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\37\ See Amendment of Parts 2 and 90 of the Commission's Rules

to Provide for the Use of 200 Channels Outside the Designated Filing

Areas in the 896-901 MHz and the 935-940 MHz Bands Allotted to the

Specialized Mobile Radio Pool, PR Docket No. 89-583, Second Order on

Reconsideration and Seventh Report and Order, 11 FCC Rcd 2639, 2693-

702 (1995); Amendment of Part 90 of the Commission's Rules to

Facilitate Future Development of SMR Systems in the 800 MHz

Frequency Band, PR Docket No. 93-144, First Report and Order, Eighth

Report and Order, and Second Further Notice of Proposed Rulemaking,

11 FCC Rcd 1463 (1995).

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19. The Commission recently held auctions for geographic area

licenses in the 900 MHz SMR band. There were 60 winning bidders who

qualified as small entities in the 900 MHz auction. Based on this

information, we conclude that the number of geographic area SMR

licensees that may be affected by the proposals in the NPRM includes

these 60 small entities. No auctions have been held for 800 MHz

geographic area SMR licenses. Therefore, no small entities currently

hold these licenses. A total of 525 licenses will be awarded for the

upper 200 channels in the 800 MHz geographic area SMR auction. The

Commission, however, has not yet determined how many licenses will

be awarded for the lower 230 channels in the 800 MHz geographic area

SMR auction. There is no basis, moreover, on which to estimate how

many small entities will win these licenses. Given that nearly all

radiotelephone companies have fewer than 1,000 employees and that no

reliable estimate of the number of prospective 800 MHz licensees can

be made, we assume, for purposes of this IRFA, that all of the

licenses may be awarded to small entities who may

[[Page 54099]]

be affected by the proposals recommended for adoption in the NPRM.

20. 220 MHz Radio Services. Because the Commission has not yet

defined a small business with respect to 220 MHz services, we will

utilize the SBA definition applicable to radiotelephone companies,

i.e., an entity employing no more than 1,500 persons.38

With respect to 220 MHz services, the Commission has proposed a two-

tiered definition of small business for purposes of auctions: (1)

for Economic Area (EA) licensees, a firm with average annual gross

revenues of not more than $6 million for the preceding three years

and (2) for regional and nationwide licensees, a firm with average

annual gross revenues of not more than $15 million for the preceding

three years. Given that nearly all radiotelephone companies under

the SBA definition employ no more than 1,500 employees (as noted

supra), we will consider the approximately 1,500 incumbent licensees

in this service as small businesses under the SBA definition.

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\38\ 13 CFR 121.201, SIC Code 4812.

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

21. Private and Common Carrier Paging. The Commission has

proposed a two-tier definition of small businesses in the context of

auctioning licenses in the Common Carrier Paging and exclusive

Private Carrier Paging services.39 Under the proposal, a

small business will be defined as either (1) an entity that,

together with its affiliates and controlling principals, has average

gross revenues for the three preceding years of not more than $3

million, or (2) an entity that, together with affiliates and

controlling principals, has average gross revenues for the three

preceding calendar years of not more than $15 million. Because the

SBA has not yet approved this definition for paging services, we

will utilize the SBA's definition applicable to radiotelephone

companies, i.e., an entity employing no more than 1,500

persons.40 At present, there are approximately 24,000

Private Paging licenses and 74,000 Common Carrier Paging licenses.

According to the most recent TRS data, 172 carriers reported that

they were engaged in the provision of either paging or ``other

mobile'' services, which are placed together in the

data.41 We do not have data specifying the number of

these carriers that are not independently owned and operated or have

more than 1,500 employees, and thus are unable at this time to

estimate with greater precision the number of paging carriers that

would qualify as small business concerns under the SBA's definition.

Consequently, we estimate that there are fewer than 172 small paging

carriers that may be affected by the proposed rules, if adopted. We

estimate that the majority of private and common carrier paging

providers would qualify as small entities under the SBA definition.

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\39\ See 47 CFR 20.9(a)(1) (noting that private paging services

may be treated as common carriage services).

\40\ 13 CFR 121.201, SIC Code 4812.

\41\ Telecommunications Industry Revenue at Fig. 2.

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22. Narrowband PCS. The Commission has auctioned nationwide and

regional licenses for narrowband PCS. There are 11 nationwide and 30

regional licensees for narrowband PCS. The Commission does not have

sufficient information to determine whether any of these licensees

are small businesses within the SBA-approved definition for

radiotelephone companies. At present, there have been no auctions

held for the major trading area (MTA) and basic trading area (BTA)

narrowband PCS licenses. The Commission anticipates a total of 561

MTA licenses and 2,958 BTA licenses will be awarded by auction. Such

auctions have not yet been scheduled, however. Given that nearly all

radiotelephone companies have no more than 1,500 employees and that

no reliable estimate of the number of prospective MTA and BTA

narrowband licensees can be made, we assume, for purposes of this

IRFA, that all of the licenses will be awarded to small entities, as

that term is defined by the SBA.

23. Rural Radiotelephone Service. The Commission has not adopted

a definition of small entity specific to the Rural Radiotelephone

Service.42 A significant subset of the Rural

Radiotelephone Service is the Basic Exchange Telephone Radio Systems

(BETRS).43 We will use the SBA's definition applicable to

radiotelephone companies, i.e., an entity employing no more than

1,500 persons.44 There are approximately 1,000 licensees

in the Rural Radiotelephone Service, and we estimate that almost all

of them qualify as small entities under the SBA's definition.

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\42\ The service is defined in section 22.99 of the Commission's

rules, 47 CFR 22.99.

\43\ BETRS is defined in sections 22.757 and 22.759 of the

Commission's rules, 47 CFR 22.757, 22.759.

\44\ 13 CFR 121.201, SIC Code 4812.

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24. Air-Ground Radiotelephone Service. The Commission has not

adopted a definition of small entity specific to the Air-Ground

Radiotelephone Service.45 Accordingly, we will use the

SBA's definition applicable to radiotelephone companies, i.e., an

entity employing no more than 1,500 persons.46 There are

approximately 100 licensees in the Air-Ground Radiotelephone

Service, and we estimate that almost all of them qualify as small

entities under the SBA definition.

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\45\ The service is defined in section 22.99 of the Commission's

rules, 47 CFR 22.99.

\46\ 13 CFR 121.201, SIC Code 4812.

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25. Private Land Mobile Radio (PLMR). PLMR systems serve an

essential role in a range of industrial, business, land

transportation, and public safety activities.47 These

radios are used by companies of all sizes operating in all U.S.

business categories. The Commission has not developed a definition

of small entity specifically applicable to PLMR licensees due to the

vast array of PLMR users. For the purpose of determining whether a

licensee is a small business as defined by the SBA, each licensee

would need to be evaluated within its own business area.

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\47\ See 47 CFR 20.9(a)(2) (noting that certain Industrial/

Business Pool service may be treated as common carriage service).

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26.The Commission is unable at this time to estimate the number

of, if any, small businesses which could be impacted by the rules.

However, the Commission's 1994 Annual Report on PLMRs 48

indicates that at the end of fiscal year 1994 there were 1,087,267

licensees operating 12,481,989 transmitters in the PLMR bands below

512 MHz. Because any entity engaged in a commercial activity is

eligible to hold a PLMR license, the proposed rules in this context

could potentially impact every small business in the United States.

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\48\ Federal Communications Commission, 60th Annual Report,

Fiscal Year 1994, at 116.

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27. Fixed Microwave Services. Microwave services include common

carrier,49 private-operational fixed,50 and

broadcast auxiliary radio services.51 At present, there

are approximately 22,015 common carrier fixed licensees in the

microwave services. The Commission has not yet defined a small

business with respect to microwave services. For purposes of this

IRFA, we will utilize the SBA's definition applicable to

radiotelephone companies--i.e., an entity with no more than 1,500

persons.52 We estimate, for this purpose, that all of the

Fixed Microwave licensees (excluding broadcast auxiliary licensees)

would qualify as small entities under the SBA definition for

radiotelephone companies.

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\49\ 47 CFR 101 et seq. (formerly, Part 21 of the Commission's

Rules).

\50\ Persons eligible under Parts 80 and 90 of the Commission's

rules can use Private Operational-Fixed Microwave services. See 47

CFR Parts 80 and 90. Stations in this service are called

operational-fixed to distinguish them from common carrier and public

fixed stations. Only the licensee may use the operational-fixed

station, and only for communications related to the licensee's

commercial, industrial, or safety operations.

\51\ Auxiliary Microwave Service is governed by Part 74 of

Title 47 of the Commission's Rules. See 47 CFR 74 et seq. Available

to licensees of broadcast stations and to broadcast and cable

network entities, broadcast auxiliary microwave stations are used

for relaying broadcast television signals from the studio to the

transmitter, or between two points such as a main studio and an

auxiliary studio. The service also includes mobile TV pickups, which

relay signals from a remote location back to the studio.

\52\ 13 CFR 121.201, SIC Code 4812.

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28. Offshore Radiotelephone Service. This service operates on

several UHF TV broadcast channels that are not used for TV

broadcasting in the coastal area of the states bordering the Gulf of

Mexico.53 At present, there are approximately 55

licensees in this service. We are unable at this time to estimate

the number of licensees that would qualify as small entities under

the SBA's definition for radiotelephone communications.

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\53\ This service is governed by Subpart I of Part 22 of the

Commission's Rules. See 47 CFR 22.1001-22.1037.

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29. Wireless Communications Services. This service can be used

for fixed, mobile, radiolocation and digital audio broadcasting

satellite uses. The Commission defined ``small business'' for the

wireless communications services (WCS) auction as an entity with

average gross revenues of $40 million for each of the three

preceding years, and a ``very small business'' as an entity with

average gross revenues of $15 million for each of the three

preceding years. The Commission auctioned geographic area licenses

in the WCS service. In the auction, there were seven winning bidders

that qualified as very small business entities, and

[[Page 54100]]

one that qualified as a small business entity. We conclude that the

number of geographic area WCS licensees affected includes these

eight entities.

IV. Description of Proposed Reporting, Recordkeeping, and Other

Compliance Requirements

30. The proposals under consideration in the NPRM would reduce

the reporting and recordkeeping requirements on telecommunications

service providers regulated under the Communications Act. The

Commission proposes to reduce regulatory burdens imposed by the

existing multiple filing requirements by combining current

contributor reporting worksheets into one unified Telecommunications

Reporting Worksheet. In addition, the Commission seeks to further

reduce carrier filing burdens by allowing carriers to use the

proposed Telecommunications Reporting Worksheet to designate agents

for service of process pursuant to section 413 of the Communications

Act of 1934, as amended,54 as well as to satisfy the

reporting requirements of section 43.21 of our rules.55

Should the Commission adopt these proposals, we expect that

telecommunications service providers would experience a significant

reduction in reporting, recordkeeping, and other compliance burdens.

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\54\ 47 USC 413.

\55\ 47 CFR 43.21(c). The Commission's rules are codified at

Title 47 of the Code of Federal Regulations. 47 CFR 0.1 et seq.

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V. Steps Taken To Minimize Significant Economic Impact on Small

Entities, and Significant Alternatives Considered

31. The impact of this proceeding should be beneficial to small

businesses because the proposals set out in the NPRM would reduce

the reporting or recordkeeping requirements on all communications

common carriers. As noted above in the NPRM,56 we seek

comment on the desirability of this proposal and ask commenters to

indicate whether a unified worksheet would reduce regulatory and

administrative burden on reporting carriers. Alternatively, we ask

commenters to indicate whether there might be any class of

contributors whose burden would be increased by the unified

worksheet.57

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\56\ See NPRM at para. 19, supra.

\57\ See NPRM at para. 20, supra.

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VI. Federal Rules That May Duplicate, Overlap, or Conflict With the

Proposed Rule

32. None.

[FR Doc. 98-27060 Filed 10-7-98; 8:45 am]

BILLING CODE 6712-01-P