# 1998 Biennial Regulatory ReviewStreamlined Contributor Reporting Requirements > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/fr%3A98-27060 ## Record - **Collection:** Federal Register - **Document type:** Proposed Rule - **Published:** October 8, 1998 - **Citation:** 63 FR 54090 ## Text 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. ----------------------------------------------------------------------- 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: ---------------------------------------------------------------------------------------------------------------- Section/title Respondents Est. time per resp. Annual burden ---------------------------------------------------------------------------------------------------------------- (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. ---------------------------------------------------------------------------------------------------------------- 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. --------------------------------------------------------------------------- \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. --------------------------------------------------------------------------- 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. --------------------------------------------------------------------------- \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. --------------------------------------------------------------------------- 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 --------------------------------------------------------------------------- \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. --------------------------------------------------------------------------- 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. --------------------------------------------------------------------------- \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. --------------------------------------------------------------------------- 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. --------------------------------------------------------------------------- \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). --------------------------------------------------------------------------- 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. --------------------------------------------------------------------------- \12\ 47 CFR 1.1206. --------------------------------------------------------------------------- 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 --------------------------------------------------------------------------- \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). --------------------------------------------------------------------------- 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. --------------------------------------------------------------------------- \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). --------------------------------------------------------------------------- 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. --------------------------------------------------------------------------- \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. --------------------------------------------------------------------------- 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. --------------------------------------------------------------------------- \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. --------------------------------------------------------------------------- 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. --------------------------------------------------------------------------- \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. --------------------------------------------------------------------------- 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 --------------------------------------------------------------------------- \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. --------------------------------------------------------------------------- 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. --------------------------------------------------------------------------- \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). --------------------------------------------------------------------------- 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. --------------------------------------------------------------------------- \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. --------------------------------------------------------------------------- \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. --------------------------------------------------------------------------- \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. --------------------------------------------------------------------------- \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. --------------------------------------------------------------------------- \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. --------------------------------------------------------------------------- \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). --------------------------------------------------------------------------- 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. --------------------------------------------------------------------------- \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). --------------------------------------------------------------------------- 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. --------------------------------------------------------------------------- \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. --------------------------------------------------------------------------- \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. --------------------------------------------------------------------------- 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. --------------------------------------------------------------------------- \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. --------------------------------------------------------------------------- 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. --------------------------------------------------------------------------- \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. --------------------------------------------------------------------------- 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. --------------------------------------------------------------------------- \47\ See 47 CFR 20.9(a)(2) (noting that certain Industrial/ Business Pool service may be treated as common carriage service). --------------------------------------------------------------------------- 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. --------------------------------------------------------------------------- \48\ Federal Communications Commission, 60th Annual Report, Fiscal Year 1994, at 116. --------------------------------------------------------------------------- 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. --------------------------------------------------------------------------- \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. --------------------------------------------------------------------------- 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. --------------------------------------------------------------------------- \53\ This service is governed by Subpart I of Part 22 of the Commission's Rules. See 47 CFR 22.1001-22.1037. --------------------------------------------------------------------------- 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. --------------------------------------------------------------------------- \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. --------------------------------------------------------------------------- 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 --------------------------------------------------------------------------- \56\ See NPRM at para. 19, supra. \57\ See NPRM at para. 20, supra. --------------------------------------------------------------------------- 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 --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/fr%3A98-27060. Public record. Not legal advice.