Assessment and Collection of Regulatory Fees for Fiscal Year 1999
Federal RegisterJul 1, 1999
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SUMMARY: The Commission has revised its Schedule of Regulatory Fees in
order to recover the amount of regulatory fees that Congress has
required it to collect for fiscal year 1999. Section 9 of the
Communications Act of 1934, as amended, provides for the annual
assessment and collection of regulatory fees. For fiscal year 1999
sections 9(b)(2) and (3) provide for annual ``Mandatory Adjustments''
and ``Permitted Amendments'' to the Schedule of Regulatory Fees. These
revisions will further the National Performance Review goals of
reinventing Government by requiring beneficiaries of Commission
services to pay for such services.
EFFECTIVE DATE: September 10, 1999.
FOR FURTHER INFORMATION CONTACT: Terry Johnson, Office of Managing
Director at (202) 418-0445 or Roland Helvajian, Office of Managing
Director at (202) 418-0444.
SUPPLEMENTARY INFORMATION:
Adopted: June 11, 1999; Released: June 18, 1999
By the Commission.
Table of Contents
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Paragraph
Topic Nos.
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I. Introduction......................................... 1
II. Background.......................................... 4
III. Discussion:........................................
A. Summary of FY 1999 Fee Methodology............... 8
B. Development of FY 1999 Fees
i. Adjustment of Payment Units.................. 13
ii. Calculation of Revenue Requirements......... 14
iii. Recalculation of Fees...................... 15
C. Changes to Fee Schedule.......................... 16
i. FY 1999 Fee Schedule Based on Mandatory 17
Adjustments....................................
ii. Reduction of the FM Construction Permit Fee. 18
iii. Redesignation of Small SMR Systems as CMRS 20
Messaging......................................
iv. Other Comments Regarding Adjustments to CMRS 22
v. Re-Activation of Interactive Video Data 27
Services Fee (now 218-219 MHz Service).........
D. Other Issues Raised by Commenters................ 28
i. Interstate Telephone Service Providers....... 30
ii. New Services Fee Category................... 33
iii. COMSAT and Non-U.S. Licensees.............. 36
iv. Non-Common Carrier Bearer Circuits.......... 40
v. GSO Space Stations........................... 42
vi. NGSO Space Stations......................... 45
vii. Commercial Radio and Television............ 47
viii. Fee Filing Software....................... 51
E. Procedures for Payment of Regulatory Fees........ 54
i. Annual Payments of Standard Fees............. 55
ii. Installment Payments for Large Fees......... 56
iii. Advance Payments of Small Fees............. 57
iv. Minimum Fee Payment Liability............... 58
v. Standard Fee Calculations and Payments....... 59
vi. Improved Fee Collection Systems............. 61
vii. Late or Insufficient Regulatory Fee Payment 62
F. Schedule of FY 1999 Regulatory Fees.............. 63
IV. Procedural Matters:
A. Ordering Clause.................................. 64
B. Authority and Further Information................ 65
Attachment A--Final Regulatory Flexibility Analysis
Attachment B--Sources of Payment Unit Estimates for FY
1999
Attachment C--Calculation of Revenue Requirements and
Pro-Rata Fees
Attachment D--FY 1999 Schedule of Regulatory Fees
Attachment E--Comparison Between FY 1998, FY 1999
Proposed, and FY 1999 Final Regulatory Fees
Attachment F--Detailed Guidance on Who Must Pay
Regulatory Fees
Attachment G--Description of FCC Activities
Attachment H--Factors, Measurements and Calculations
that go into Determining Station Signal Contours and
Associated Population Coverages
Attachment I--Parties Filing Comments and Reply Comments
Attachment J--AM and FM Radio Regulatory Fees
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I. Introduction
1. By this Report and Order, the Commission concludes a proceeding
to revise its Schedule of Regulatory Fees in order to collect the
amount of regulatory fees that Congress has required it to collect for
Fiscal Year (FY) 1999.1
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\1\ Assessment and Collection of Regulatory Fees for Fiscal Year
1999, FCC 98-298, released December 4, 1998, 63 FR 70090 (Dec. 18,
1998) (NOI), and FCC 99-44, released March 24, 1999, 64 FR 16661
(Apr. 6, 1999) (NPRM).
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[[Page 35833]]
2. Congress has required that we collect $172,523,000 through
regulatory fees in order to recover the costs of our enforcement,
policy and rulemaking, international and user information activities
for FY 1999.2 This amount is $10,000,000 or approximately 6%
more than the amount that Congress designated for recovery through
regulatory fees for FY 1998.3 Thus, we are revising our fees
in order to collect the increased amount that Congress has required for
us to collect. Additionally, we are amending the Schedule in order to
simplify and streamline it.4
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\2\ Pub. L. 105-277 and 47 U.S.C. 159(a)(2).
\3\ Assessment and Collection of Regulatory Fees for Fiscal Year
1998, FCC 98-115, released June 16, 1998, 63 FR 35847 (Jul. 1,
1998).
\4\ 47 U.S.C. 159(b)(3).
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3. In revising our fees, we adjusted the payment units and revenue
requirement for each service subject to a fee, consistent with sections
159(b) (2) and (3). In addition, we are making changes to the fees
pursuant to public interest considerations. The current Schedule of
Regulatory Fees is set forth in Secs. 1.1152 through 1.1156 of the
Commission's rules.5
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\5\ 47 CFR 1.1152 through 1.1156.
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II. Background
4. Section 9(a) of the Communications Act of 1934, as amended,
authorizes the Commission to assess and collect annual regulatory fees
to recover the costs, as determined annually by Congress, that it
incurs in carrying out enforcement, policy and rulemaking,
international, and user information activities.6 See
Attachment G for a description of these activities. In our FY 1994 Fee
Order,7 we adopted the Schedule of Regulatory Fees that
Congress established, and we prescribed rules to govern payment of the
fees, as required by Congress.8 Subsequently, we modified
the fee Schedule to increase the fees in accordance with the amounts
Congress required us to collect in each succeeding fiscal year. We also
amended the rules governing our regulatory fee program based upon our
experience administering the program in prior years.9
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\6\ 47 U.S.C. 159(a).
\7\ 59 FR 30984 (Jun. 16, 1994).
\8\ 47 U.S.C. 159(b), (f)(1).
\9\ 47 CFR 1.1151 et seq.
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5. As noted above, for FY 1994 we adopted the Schedule of
Regulatory Fees established in section 9(g) of the Act. For fiscal
years after FY 1994, however, sections 9(b) (2) and (3), respectively,
provide for ``Mandatory Adjustments'' and ``Permitted Amendments'' to
the Schedule of Regulatory Fees.10 Section 9(b)(2), entitled
``Mandatory Adjustments,'' requires that we revise the Schedule of
Regulatory Fees whenever Congress changes the amount that we are to
recover through regulatory fees.11
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\10\ 47 U.S.C. 159(b)(2), (b)(3).
\11\ 47 U.S.C. 159(b)(2).
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6. Section 9(b)(3), entitled ``Permitted Amendments,'' requires
that we determine annually whether additional adjustments to the fees
are warranted, taking into account factors that are reasonably related
to the payer of the fee and factors that are in the public interest. In
making these amendments, we are to ``add, delete, or reclassify
services in the Schedule to reflect additions, deletions or changes in
the nature of its services.'' 12
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\12\ 47 U.S.C. 159(b)(3).
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7. Section 9(i) requires that we develop accounting systems
necessary to adjust our fees pursuant to subsection b(3), and for other
purposes.13 For FY 1997, we relied for the first time on
cost accounting data to identify our regulatory costs and to develop
our FY 1997 fees based upon these costs. Also, for FY 1997, we limited
the increase in the amount of the fee for any service, so that we can
phase in our reliance on cost-based fees for those services, whose
revenue requirement would be more than 25 percent above the revenue
requirement which would have resulted from the ``mandatory
adjustments'' to the FY 1997 fees without incorporation of these costs.
This methodology, which we continued to utilize for FY 1998, enabled us
to develop regulatory fees which we believed to be more reflective of
our costs of regulation, and allowed us to make revisions to our fees
based on the fullest extent possible, and consistent with the public
interest, on the actual costs of regulating those services subject to a
fee. Finally, section 9(b)(4)(B) requires that we notify Congress of
any permitted amendments 90 days before those amendments go into
effect.14
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\13\ 47 U.S.C. 159(i).
\14\ 47 U.S.C. 159(b)(4)(B).
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III. Discussion
A. Summary of FY 1999 Fee Methodology
8. As noted above, Congress has required that the Commission
recover $172,523,000 for FY 1999 through the collection of regulatory
fees, representing the costs applicable to our enforcement, policy and
rulemaking, international, and user information
activities.15 This fact is the overriding principle that
determines how the fee schedule is adjusted. Notwithstanding any
considerations of benefit to the fee payer, it is a zero-sum mandate in
which any adjustment downward must be met with a corresponding
adjustment upward for all others to ensure collection of the aggregate
amount mandated by Congress in its appropriation Act.
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\15\ 47 U.S.C. 159(a).
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9. In developing our FY 1999 fee schedule, we first determined that
we would continue to use the same general methodology for ``Mandatory
Adjustments'' to the Fee Schedule as we used in developing fees for
previous fiscal years. As required by section 9(b)(2), we estimated the
number of payment units 16 for FY 1999 in order to determine
the aggregate amount of revenue we would collect without any revision
to our FY 1998 fees. Next, we compared this revenue amount to the
$172,523,000 that Congress has required us to collect in FY 1999 and
pro-rated the difference among all the existing fee categories.
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\16\ Payment units are the number of subscribers, mobile units,
pagers, cellular telephones, licenses, call signs, adjusted gross
revenue dollars, etc. which represent the base volumes against which
fee amounts are calculated.
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10. Once we established our tentative FY 1999 fees, we evaluated
proposals made by Commission staff concerning ``Permitted Amendments''
to the Fee Schedule and to our collection procedures. However, as
stated in paragraph 8, any permitted amendment made affects all other
feeable categories to ensure the total amount required will still be
collected. These proposals are discussed in paragraphs 16-31 and are
factored into our FY 1999 Schedule of Regulatory Fees, set forth in
Attachment D.
11. It should be further noted that the requirement to derive fees
based on the number of full-time equivalent number of employees is
superseded by the cost accounting system developed pursuant to section
9(i) which is combined with the payroll and benefits system to
incorporate that information. Non-employee contractual activities are
not charged to feeable activities directly, but are factored into
overhead. Also, the primary purpose of the cost accounting system is to
support the making of permitted amendments, and it is not required to
be used in developing the fee schedule.
12. Finally, we have incorporated, as Attachment F, proposed
Guidance containing detailed descriptions of each fee category,
information on the individual or entity responsible for
[[Page 35834]]
paying a particular fee and other critical information designed to
assist potential fee payers in determining the extent of their fee
liability, if any, for FY 1999. In the following paragraphs, we
describe in greater detail our methodology for establishing our FY 1999
regulatory fees.
B. Development of FY 1999 Fees
i. Adjustment of Payment Units
13. In calculating individual service regulatory fees for FY 1999,
we adjusted the estimated payment units for each service because
payment units for many services have changed substantially since we
adopted our FY 1998 fees. We obtained our estimated payment units
through a variety of means, including our licensee data bases, actual
prior year payment records, and industry and trade group projections.
Whenever possible, we verified these estimates from multiple sources to
ensure the accuracy of these estimates. Attachment B provides a summary
of how revised payment units were determined for each fee
category.17
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\17\ It is important to also note that Congress' required
revenue increase in regulatory fee payments of approximately six
percent in FY 1999 will not fall equally on all payers because
payment units have changed in several services. When the number of
payment units in a service increase from one year to another, fees
do not have to rise as much as they would if payment units had
decreased or remained stable. Declining payment units have the
opposite effect on fees.
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ii. Calculation of Revenue Requirements
14. We next multiplied the revised payment units for each service
by the FY 1998 fees in each category to determine how much revenue we
would collect without any change to the FY 1998 Schedule of Regulatory
Fees. The amount of revenue which we would collect without changes to
the Fee Schedule is approximately $157.6 million. This amount is
approximately $14.9 million less than the amount the Commission is
required to collect in FY 1999. We then adjusted the revenue
requirements for each category on a proportional basis, consistent with
Section 9(b)(2) of the Act, to obtain an estimate of the revenue
requirements for each fee category so that the Commission could collect
$172,523,000 as required by Congress. Attachment C provides detailed
calculations showing how we determined the revised revenue amounts to
be raised for each service.
iii. Recalculation of Fees
15. Once we determined the amount of fee revenue that is necessary
to collect from each class of licensee, we divided the revenue
requirement by the number of payment units (and by the license term, if
applicable, for ``small'' fees) to obtain actual fee amounts for each
fee category. These calculated fee amounts were then rounded in
accordance with section 9(b)(3) of the Act. See Attachment C.
C. Changes to Fee Schedule
16. We examined the results of our calculations to determine if
further adjustments of the fees and/or changes to payment procedures
were warranted based upon the public interest and other criteria
established in 47 U.S.C. 159(b)(3).18 As a result of this
review, we are making the following ``Permitted Amendments'' to our Fee
Schedule:
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\18\ In FY 1997 and FY 1998 we limited increases to 25%. For FY
1999, none of the proposed fee increases exceed 25%.
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i. FY 1999 Fee Schedule Based on Mandatory Adjustments
17. The FY 1999 fee schedule is based on the ``Mandatory
Adjustments'' as computed in Attachment C and in accordance with
section 9(b)(2) of the Act. After the Notice of Proposed Rulemaking
(Assessment and Collection of Regulatory Fees for Fiscal Year 1999, FCC
99-44, released March 24, 1999, 64 FR 16661 (Apr. 6, 1999) was issued,
the staff determined that its original estimates of the number of
payment units for Marine (Ship) should be reduced from 16,800 to 7,100
to reflect a reduction in renewal applications caused by the transition
from five-year to ten-year license terms. Likewise, the number of
payment units for Aviation (Aircraft) is being reduced from 4,800 to
4,500.
ii. Reduction of the FM Construction Permit Fee
18. In the original Congressional fee schedule, the FM Construction
Permit fee was set at $500 (five times the AM Construction Permit fee
of $100). In succeeding years' schedules, nearly the same relationship
has prevailed as evidenced by the calculated FM Construction Permit fee
for FY 1999 of $1,250 (compared to the calculated AM Construction
Permit fee for FY 1999 of $260). While the Commission's regulatory
costs in processing FM Construction Permit fees are higher than its
costs for AM Construction Permit fees, several parties have expressed
concern that the FM Construction Permit fee is nevertheless
disproportionately high particularly in less populated areas.
19. In the Notice of Proposed Rulemaking (NPRM), we sought comment
on a staff proposal to make a permitted amendment to the schedule of
regulatory fees for FY 1999 reducing the FM Construction Permit fee to
three times the AM Construction Permit fee. The Commission did not
receive comments on the proposal to reduce the FM Construction Permit
regulatory fee, and is adopting the proposal herein.
iii. Redesignation of Small SMR Systems as CMRS Messaging
20. In the NOI,19 we solicited comment on whether the
Commercial Mobile Radio Services (``CMRS'') fee categories should be
revised to reflect types of service or usage. In FY 1998, the
demarcation of fee categories was based on the authorized bandwidth,
rather than the nature of the service offered. CMRS licensees
authorized to operate on broadband spectrum were classified within the
CMRS Mobile Services fee category, while CMRS licensees authorized to
operate on narrowband spectrum were classified within the CMRS
Messaging fee category. In this context, several parties, including
BellSouth Wireless Data, the Paging Network (``PageNet''), and ARDIS
Company (Ardis) urge the Commission to reclassify the 900 MHz
Specialized Mobile Radio Service (``SMR'') systems for regulatory fee
purposes. Specifically, the commenters assert that SMR systems used for
mobile data services are similar to and compete with CMRS messaging
services, and accordingly, should be classified as such for section 9
purposes. The Council of Independent Communications Suppliers
(``CICS'') and the American Mobile Telecommunications Association, Inc.
(``AMTA'') further maintain that all ``traditional'' SMR are similarly
situated to messaging services in terms of the limited amount of
spectrum utilized and the limited nature of the services offered, and
thus recommend the reclassification of all traditional SMR services.
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\19\ See FY 1999 NOI at paragraph 9.
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21. We are persuaded by the comments that the SMR service is
similar to the CMRS Messaging service, that the SMR service should be
accorded similar treatment with respect to regulatory fee requirements,
and thus that reclassification is warranted. Accordingly, we are
revising our designation of services contained in the CMRS Messaging
fee category. For FY 1999, the CMRS Messaging fee category will also
include all SMR systems authorized for operation with less than 10 MHz
bandwidth.
[[Page 35835]]
iv. Other Comments Regarding Adjustments to CMRS
22. In the NOI,20 we specifically asked commenters to
provide proposals to establish models, or direct us to available
sources of data, that estimate the number of payment units (number of
subscribers) in the CMRS service to enable us to calculate fees that
more accurately reflect the regulatory costs associated with this
service. The Cellular Telecommunications Industry Association (CTIA)
takes issue with the Commission's methodology and projections. CTIA
argues that section 9(i) of the Communications Act of 1934 (``Act''),
as amended, ``requires that [the Commission] develop accounting systems
necessary to adjust [its] fees pursuant to changes in the costs of
regulation of various services that are subject to a fee.''
21 Instead, they argue further, the Commission has adopted a
more complicated, and ultimately unreliable, approach described in
detail in the Notice.22 CTIA argues that the Notice
prescribes fees that raise an additional 6 percent above FY 1998, but
that the proposed increase to CMRS Mobile services is over 10 percent.
CTIA argues that this approach is wrong because it bases fees on growth
in a particular sector of the industry instead of on the costs of
regulating that sector, and it uses a figure that underestimates the
number of wireless subscribers. We disagree and believe our actions are
proper and consistent with the Act. As described above, the Commission
began by estimating the number of units 23 for FY 1999 for
each industry and multiplying that figure by each industry's FY 1998
per unit charge. The amount which resulted was $157.6 million, $14.9
million less than required by Congress.24 To collect the
difference, the Commission ``then adjusted the revenue requirements for
each category on a proportional basis.'' 25 In other words,
each communications sector's proportional contribution percentage was
multiplied by the anticipated shortfall, and the result was added to
that sector's total revenue requirement for FY 1999. Finally, the total
revenue requirement was divided by the total number of estimated units
to determine the per unit fee for each category.26
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\20\ See FY 1999 NOI at paragraph 9.
\21\ CTIA comments at p. 2.
\22\ CTIA comments at p. 2.
\23\ ``Payment units are the number of subscribers, mobile
units, pagers, cellular telephones, licenses, call signs, adjusted
gross revenue dollars, etc. which represent the base volumes against
which fee amounts are calculated.'' Notice at paragraph 9, n.16. For
the purpose of these Comments, the term ``subscribers'' is used
interchangeably with ``units.''
\24\ CTIA comments at p. 2.
\25\ CTIA comments at p. 2-3.
\26\ CTIA comments at p. 3.
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23. Section 9(i) states that ``(t)he Commission shall develop
accounting systems necessary to making the adjustments authorized by
subsection (b)(3).'' Subsection (b)(3) states that ``(i)n addition to
the adjustments required by paragraph (2), the Commission shall, by
regulation, amend the Schedule of Regulatory Fees if the Commission
determines that the Schedule requires an amendment to comply with the
requirements of paragraph (1)(A).'' Paragraph (2) refers to paragraph
(b)(2) which requires that ``the Commission shall, by rule, revise the
Schedule of Regulatory Fees by proportionate increases or decreases to
reflect, in accordance with paragraph (1)(B), changes in the amount
appropriated for the performance of the activities described in
subsection (a) for such fiscal year.'' Subsection (b)(2)(A) requires
the adjustments to be made in accordance with the ``increases or
decreases in the number of licensees or units subject to payment of
such fees.'' Subsection (b)(2)(B) requires that the fees be
``established at amounts that will result in collection of an aggregate
amount of fees pursuant to this section that can reasonably be expected
to equal the aggregate amount of fees that are required to be collected
by appropriations Acts pursuant to paragraph (1)(B).''
24. Given the provisions as a whole, the statute requires that,
first and foremost, we must attempt to collect the aggregate amount
that Congress requires in the appropriation Act, i.e. $172,523,000 for
FY 1999. To achieve this, we must first adjust our estimates of payment
units and apply proportionate shares of the shortfall to all fee
categories until the $172,523,000 total is reached. At this point, we
have the option of making permitted amendments, if we determine that it
is required. Bearing in mind that any reduction in the fee obligations
for any fee category must result in additional increases in the fee
obligations imposed on all other fee categories to insure full
collection of the $173,523,000, we (with one minor exception, namely FM
Construction Permits) did not propose such amendments, and use of the
cost accounting system to support such adjustments was not necessary.
Finally, our cost accounting system has been previously explained in
great detail in our FY 1996 and FY 1997 proceedings. It is the language
of the Act in section (b)(2) which establishes the relationship between
the number of payment units and the costs we must recover for our
regulatory activities. Nothing in CTIA's argument convinces us that we
erred in our methodology.
25. CTIA also argues that we have seriously underestimated the
number of CMRS units. It states that it ``is confident that the number
of CMRS mobile services units has risen dramatically over last year--
enough to result in a substantial decrease in per unit charges.''
27 CTIA states that the ``correct number for FY 1999 is
69,209,000 units, not the 55,540,000 units the Commission has
estimated.'' 28 In its comments, AirTouch also argues that
our estimate is too low.
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\27\ CTIA comments at p. 5
\28\ CTIA comments at p. 5.
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26. In determining its estimates of the number of payment units,
the Commission consults several sources, if available. We have found
that there are often large disparities in the estimates provided by
various industry associations. These differences may be due to the
differences in purposes for which the data is gathered, sampling
methods used, etc. It should be further noted that our experience with
industry estimates in prior years has resulted in high levels of
underpayment in the CMRS category. Given the fact that we are required
by the statute to collect ``an amount that can reasonably be expected
to equal the amount appropriated * * *'' we have proposed to establish
estimates that more closely match the number of units for which
payments have been received. With regard to the CMRS sector, the
following chart shows the number of subscriber payment units estimated
and the actual number based on fee payments per year.
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CMRS
CMRS mobile messaging
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FY 1995 ESTIMATE............................ 23,400,000 19,600,000
FY 1995 ACTUAL.............................. 22,959,273 12,189,094
FY 1996 ESTIMATE............................ 30,000,000 24,500,000
FY 1996 ACTUAL.............................. 24,560,543 18,810,299
FY 1997 ESTIMATE............................ 51,472,190 48,900,000
FY 1997 ACTUAL.............................. 43,553,534 31,047,469
FY 1998 ESTIMATE............................ 55,540,000 39,592,000
FY 1998 ACTUAL.............................. 54,730,365 34,373,200
------------------------------------------------------------------------
Given the data before us, while recognizing it is a conservative
increase over the 1998 actual figure, we continue to believe our
estimate for 1999 is
[[Page 35836]]
reasonable, especially in light of our reclassification of small SMR
systems.
v. Re-Activation of Interactive Video Data Services Fee (Now 218-219
MHz Service)
27. When the NPRM was being developed, it was thought that there
would be no interactive video data service (IVDS) applications received
in FY 1999. No new assignments are available and most previous
authorizations were granted for a ten-year license term (none of which
expire in FY 1999). After release of the NPRM, it was discovered that
there are 513 IVDS licenses that were issued with five-year expiration
dates that will come up for renewal in FY 1999. Therefore, we are re-
activating the regulatory fee for IVDS (now 218-219 MHz Service) and
have calculated it to be $13 on an annual basis. The entire regulatory
fee will be $65 for a five-year term.
D. Other Issues Raised by Commenters
28. On November 10, 1998, the Commission adopted a Notice of
Inquiry in this proceeding seeking comments on five specific
issues.29 Briefly, the issues for which comments were sought
included: (1) Clarification of the Commercial Mobile Radio Services
(``CMRS'') fee categories and demarcation of which types of services or
usage to include in each category; 30 (2) determination of
the appropriate basis for assessing regulatory fees on geostationary
orbit space stations (``GSOs''); (3) determination of the appropriate
method of assessing our regulatory costs associated with non-
geostationary orbit space station systems (``NGSOs'') to licensees
which have launched satellites or to all NGSO licensees; (4) whether we
should base revenues for interstate telephone service providers on the
Universal Services Fund's end user methodology rather than the
Telecommunication Relay Services Fund's adjusted gross revenue
methodology; and (5) whether we should create a ``new services''
category in our cost accounting system in which costs associated with
development of new services, regardless of the service, would be
proportionately assessed to all feeable categories rather than assessed
to existing licensees in the same service category. In the interest of
expediting the NPRM, we deferred analysis of the comments and replies
received pursuant to the NOI for inclusion in this final Report and
Order.
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\29\ 63 FR 70090 (Dec. 18, 1998).
\30\ In this regard we specifically requested additional
comments on a proposal raised by BellSouth Wireless in its Petitions
for Reconsideration of the FY 1997 and FY 1998 Rulemakings, that the
Commission reclassify 900 MHz SMR Service into the CMRS Message
Service.
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29. In addition to the comments which support the changes we are
adopting in this Report and Order, commenters expressed other views
which we intend to address here. These issues cover comments and reply
comments received on both the NOI and the NPRM.
i. Interstate Telephone Service Providers
30. In the NOI,31 we solicited comment on BellSouth
Corporation's (BellSouth) proposal to change the methodology used to
assess fees upon interstate telephone service providers. Specifically,
BellSouth proposed that the regulatory fees imposed upon interstate
telephone service providers be based on their end user revenues (i.e.,
the same contribution base used for the Universal Fund), instead of the
current methodology, which is based on their proportionate share of
industry net revenues (i.e., the same contribution base used for the
TRS Fund). BellSouth contended that its proposal is ``more
competitively neutral,'' given that the current methodology favors
interexchange carriers (``IXCs'') by virtue of the fact that they are
able to deduct payments made to the underlying carriers. The end user
methodology was opposed by MCI WorldCom, Inc. (MCI WorldCom), which
claimed that this methodology effectively would shift regulatory costs
from the local exchange carriers (``LECs'') to the ``highly
competitive, price sensitive'' IXCs (which unlike LECs cannot recover
their costs through regulated rates) and, as such, would not be
competitively neutral. BellSouth supported the end user methodology,
but recommended that the Commission defer consideration on the
appropriate methodology until it concludes the pending rulemaking (CC
Docket No. 98-171, In the Matter of 1998 Biennial Regulatory Review--
Streamlined Contributor Reporting Requirements Associated with
Administration of Telecommunications Relay Services, North American
Numbering Plan, Local Number Portability, and Universal Service Support
Mechanisms), which is examining, among other things, both TRS and
Universal Fund support mechanisms.32 We believe that
properly calculated, the end result should be relatively equivalent
regardless of whether the fee is based on gross revenues less expenses
paid to the underlying carriers or end user revenues.
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\31\ See FY 1999 NOI at paragraph 15.
\32\ FCC 98-233, released September 25, 1998, 63 FR 54090 (Oct.
8, 1998).
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31. We are unpersuaded by MCI WorldCom, Inc.'s contention that the
end-user telecommunications revenue method is not competitively neutral
simply because it will attribute a greater portion of direct
contributions to IXCs.33 As support for its proposal that
the Commission utilize a net telecommunications revenue basis for NANP
and TRS, MCI correctly observes that the portion of contributions paid
by IXCs will likely increase, as compared to that paid directly by
local service providers, under an end-user telecommunications revenue
basis, primarily because toll carriers, including IXCs, will contribute
based on the revenues they collect from their end users to pay
incumbent LECs' access charges. As described above, however, the end-
user basis meets our two prong test for competitive neutrality, as set
out in the LNP Cost Recovery Order.34 The fact that
carriers--whether IXCs or incumbent LECs--providing interstate toll
services to end users may bear a slightly higher portion of
contributions does not alter that analysis, because, even assuming that
MCI's projections are correct, this change would not give one service
provider an appreciable, incremental cost advantage when competing for
a particular subscriber.
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\33\ See MCI Reply Comments at 4.
\34\ See LNP Cost Recovery Order, paragraph 106-107.
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32. Further, we believe that MCI's analysis of the purported burden
shift falls short. We do not believe that this change in revenue basis
will significantly favor one segment of the industry over another. To
the extent that direct contributions are shifted, we note that IXCs
would incur those costs attributable to access revenues under both a
net telecommunications revenue basis and an end-user telecommunications
revenue basis.35 For example, contributions to the TRS
mechanism under the current gross telecommunications revenue basis are
treated as exogenous costs under price cap regulation, meaning that the
overwhelming majority of these costs are passed through to toll
carriers under
[[Page 35837]]
either methodology.36 As the Commission concluded in the LNP
Cost Recovery Order, because the end-user telecommunications revenue
basis reaches the same result, but without the inefficiency and added
complication of the pass-through step, we prefer the end-user
telecommunications revenue basis.37 In any event, we agree
with BellSouth that any decision on the appropriate methodology should
be deferred until the conclusion of the pending rulemaking proceeding.
---------------------------------------------------------------------------
\35\ See Telecommunications Relay Services and the Americans
with Disabilities Act of 1990, Second Order on Reconsideration and
Fourth Report and Order, FCC 93-463, Docket No. 90-571, 9 FCC Rcd
1637 (rel. Sept. 29, 1993) (clarifying that TRS Fund contributions
may be treated as exogenous costs under price cap regulation). To
this end, we believe that AT&T suggestion concerning price cap
reductions would be more appropriately considered in access charge
proceedings. See CFR section 69.1. See also LNP Cost Recovery Order,
paragraph 109 (suggesting that incumbent LECs would like pass on
shared costs of number portability to IXCs through exogenous
treatment in their access rates).
\36\ Id.
\37\ See LNP Cost Recovery Order, paragraph 109.
---------------------------------------------------------------------------
ii. New Serices Fee Category
33. In the NOI we sought comments on establishing a new services
fee category. The regulatory costs associated with the policy and
rulemaking to establish new and emerging technologies and services were
to be charged to the new services activity. The costs attributed to the
new services category were then to be distributed proportionally to all
other feeable activities, and would not be borne by a specific,
established service.
34. GE American Communications, Inc. (GE) argues in support of
establishing a new services fee category on the basis that until an
authorization is granted, licensees are unknown and it would be unfair
to attribute the costs to existing licensees. BellSouth, Personal
Communications Industry Association (PCIA), and Lockheed Martin, on the
other hand, disagree that it would be appropriate to charge costs to
licensees in other unrelated service categories in the form of overhead
when it is clear that they derive no benefit from the regulatory
activity. Indeed, as BellSouth points out, under section 9(a)(1), the
Commission shall assess and collect regulatory fees for rulemaking
proceedings, which would include the costs associated with the
introduction of new services. However, section 9(b)(1)(A) provides that
the fees assessed must be adjusted ``to take into account factors that
are reasonably related to the payor of the fee.'' BellSouth thus
asserts that an ``across-the-board'' new service fee category would not
comply with section 9(b)(1)(A), because it would impose fees on payers
who are not benefited by the introduction of the new service.
35. We are not persuaded that creation of a new services category
is appropriate at this time. Further, this concept presents technical
and policy problems with respect to our current cost accounting system
which cannot be resolved for FY 1999 fee collections. Data is not
available in its present form and costs cannot be reallocated as would
be necessary to implement a new services fee category now. We are in
the planning stages for rewriting the software for our cost accounting
system, and this issue will become part of those discussions.
iii. COMSAT and Non-U.S. Licensees
36. PanAmSat and GE American Communications argue that we should
impose fees on COMSAT Corporation (COMSAT) to recover the Signatory and
other expenses created by COMSAT. Loral Space & Communications states
that because COMSAT competes with other U.S. satellite operators that
are subject to regulatory fees, it is given a clear advantage over its
competitors. Loral Space and Communications, therefore, contends that
the Commission should impose fair and equitable fees on COMSAT. This
issue has been considered and dismissed several times. In addition, GE,
the Satellite Industry Association (SIA), and PanAmSat contend that the
cost of regulation should be borne by all satellite service providers,
which in light of the recent privatization of Inmarsat Limited, should
include fair share payments from COMSAT and foreign-licensed satellite
providers. Previously, because of the International Organization
Immunities Act, COMSAT was exempt from paying regulatory fee payments
for Inmarsat space stations. In its reply comments, COMSAT argues to
the contrary that neither COMSAT, INTELSAT, nor Inmarsat are subject to
Section 9 of the Communications Act of 1934, and neither Inmarsat nor
its satellites are subject to Title III of the Act. In short, COMSAT
argues that the FCC lacks jurisdiction in imposing space station or any
new category of fees on COMSAT because ``regulatory fees apply only to
space stations directly licensed by the FCC under Title III of the
Communications Act.'' Finally, SIA questions the estimate of 42.5 GSO
space stations.
37. COMSAT has in the past and continues to be responsible for
payment of regulatory fees for its licensed facilities. For example, in
FY 1998, COMSAT paid regulatory fees for two geostationary space
stations, 142 earth stations, and 53,957 international bearer circuits
for a total of $585,172. With respect to the estimate of 42.5 GSO space
stations, based on the October 1, 1998 cut-off date, there are 43
satellites in operation. However, Columbia received a waiver for one-
half the capacity for one of its satellites. The waiver was granted
because Columbia established that, unlike other U.S. fixed satellite
service licensees, it was under contract with NASA, its satellite
capacity was not entirely within its control, and its use was secondary
to NASA's.38 Therefore, the GSO fees was formulated based on
42.5 satellites.
---------------------------------------------------------------------------
\38\ 1999 Westlaw 22920. In regarding Application of Columbia
Communications Corporation, FCC 98-299 (January 22, 1999) (WESTLAW,
FCOM-FCC library).
---------------------------------------------------------------------------
38. The space station facilities owned by INTELSAT and Inmarsat are
not licensed to COMSAT. COMSAT has been designated to represent the
United States as its signatory agent. As COMSAT argues, the courts have
ruled that we may not assess a fee upon COMSAT for its role in the
administration of the INTELSAT and Inmarsat space stations. Moreover,
commenters have argued that since Inmarsat space stations were
converted ``to a newly created private company, Inmarsat Limited
(incorporated in the United Kingdom), COMSAT's exemption from payment
in relation to the Inmarsat system should be eliminated. Legislation
requiring INTELSAT to privatize is currently pending before Congress,
and full privatization is not complete. At present, it is not clear who
will hold the license after privatization. Therefore, COMSAT presently
remains as the designated U.S. Signatory to INTELSAT. Regardless of
COMSAT's interest in the INTELSAT satellites in question, they are not
licensed under Title III and, therefore, not subject to regulatory
fees.39
---------------------------------------------------------------------------
\39\ Assessment and Collection of Regulatory Fees for Fiscal
Year 1995, 60 FR 30004 (June 29, 1995) and Assessment and Collection
of Regulatory Fees for Fiscal Year 1997, 62 FR 37408 (July 11,
1997); COMSAT Corp v. Federal Communications Commission, 114 F. 3d
223 (D.C. Cir. 1997).
---------------------------------------------------------------------------
39. It has also been suggested that non-U.S. licensed satellite
service providers who operate in the U.S. should be assessed regulatory
fees. Clearly, legislative history provides that only space stations
licensed under Title III may be subject to regulatory fees. Although
non-U.S.-licensed satellite operators do compete with U.S.-licensed
satellite operators, they are not licensed under Title III. Therefore,
we cannot include operators of non-U.S.-licensed satellite space
stations among regulatory fee payers.
iv. Non-Common Carrier Bearer Circuits
40. The Satellite Industry Association (``SIA'') maintains that the
Commission should revisit whether it is authorized to assess
international bearer circuit regulatory fees on non-common carrier
satellite operators. According to SIA, because section 9 of the
Communications Act specifies that carriers are required to pay
international
[[Page 35838]]
bearer circuit fees, the Commission is only authorized to collect such
fees from common carriers, not non-common carrier satellite operators.
PanAmSat, in support of SIA, asserts that because non-common carrier
bearer circuits are offered on a private basis and not subject to Title
II regulations, they do not exact the same regulatory costs and should
not be subject to the same regulatory fees as common carrier satellite
operators.
41. In response to SIA's position that international bearer circuit
regulatory fees be imposed only on common carriers, the Commission
contends that SIA's argument is a matter of terminology. When section 9
was initially drafted, the fee schedule was divided along the lines of
the existing bureaus and offices at the time. Since then, the
Commission has undergone reorganizations and shifting of
responsibilities for administering several services. When the original
legislation was drafted, international bearer circuits were
administered by the Common Carrier Bureau--thus in the Common Carrier
Bureau section of the original schedule. With the creation of the
International Bureau, international bearer circuits became the
responsibility of the International Bureau. Moreover, justification for
including non-common carrier circuits, which serve users
internationally, was provided in previous years'
proceedings.40
---------------------------------------------------------------------------
\40\ See FY 1998 Report & Order at paragraphs 57-63.
---------------------------------------------------------------------------
v. Geostationary Orbit Space Stations (``GSOs'')
42. In the NOI,41 we noted that the method of
calculating and assessing the regulatory fees imposed on GSO licensees
on a ``per satellite basis'' has been controversial and the subject of
comments for several years. Therefore, we solicited comment on
alternative methods for calculating and assessing GSOs regulatory fees.
In this connection, we specifically requested commenters to ``specify
the data upon which we can base any alternative approach and the most
feasible method for obtaining the data necessary to calculate fees''.
42 However, notwithstanding alternative methods for
calculating regulatory fees, it is important to note that the
percentage of increase in FY 1999 fees will not exactly match the
overall Congressional increase of 6 percent. For most fee categories,
the increase will be less than 10 percent, which is necessary to cover
the costs of services that are exempt from payment of regulatory fees.
In our FY 1998 Report and Order at paragraph 51, we explained that the
costs used to develop our fees were derived from our cost accounting
system which separates application processing costs from regulatory
costs. We find nothing in the arguments put forth by the Satellite
Industry Association (``SIA'') and GE American Communications (``GE'')
which persuade us that our methodology is incorrect.
---------------------------------------------------------------------------
\41\ See FY 1999 NOI at paragraph 10.
\42\ See FY 1999 NOI at paragraph 10.
---------------------------------------------------------------------------
43. PanAmSat, Loral and GE argue that the regulatory fees imposed
on in-orbit GSOs bear scant relationship to the Commission's costs.
Specifically, they argue that the Commission's costs are primarily
incurred at the application stage, and are recovered through the
substantial application fees imposed on GSO licensees. Because the
Commission's oversight is very limited once the GSO space station is in
orbit, they urge the Commission to re-examine the assessment of
regulatory fees in this context to ensure that GSO licensees are not
subsidizing other services.
44. The Commission incurs costs for satellite policy and
rulemaking, enforcement and user information activities. As directed by
Congress, these costs must be recovered through the collection of
regulatory fees. In accordance with the provisions of Section 9, the
Commission's overall goal is to recover all of the costs associated
with satellite regulatory activities and to distribute these costs
fairly amongst fee payers, taking into account factors reasonably
related to the benefits provided by the payer, as well as ``other
factors we determine are necessary in the public interest.''
vi. Non-Geostationary Orbit Space Stations (``NGSOs'')
45. In our NOI,43 we noted that Orbital Communications
Corporation (``ORBCOMM'') had submitted comments in our FY 1998
rulemaking proceeding, challenging the Commission's practice of
requiring each NGSO licensee to pay regulatory fees upon commencement
or certification of its first satellite's operation.44
ORBCOMM contended that because all NGSOs licensees benefit from the
Commission's policy, enforcement and information activities and
services, they all should be required to pay regulatory fees,
irrespective of whether they have launched their first satellite. Space
Imaging L.P. (Space Imaging) suggests that the Commission should create
a new regulatory fee category for small constellations of non-
geostationary orbit (NGSO) satellites. Further, Space Imaging
recommends that the two categories be: (1) systems of up to five
satellites and (2) systems of more than five satellites. Orbital
Communications Corporation (ORBCOMM) argues that all NGSO systems
authorized should pay regulatory fees regardless of whether or not
there is at least one satellite launched and operational. L/Q Licensee,
Inc. (LQL) and Globalstar LP (Globalstar) contend that a NGSO system is
not operational until more than one satellite is capable of operating.
LQL and Globalstar recommend that we delay requiring fee payment until
the full constellation is completed, or that we establish a lower fee
of 25% when only the first satellite becomes operational.
---------------------------------------------------------------------------
\43\ See FY 1999 NOI at paragraph 11.
\44\ See FY 1998 Report & Order at paragraph 55.
---------------------------------------------------------------------------
46. For the reasons stated above, we believe that the methodology
for establishing the fee increase is reasonable. Regarding L/QL's and
Globalstar's proposal to delay fee payments, we decline to adopt the
proposal. We have previously dismissed the idea of waiting until the
full constellation is completed because of the potentially lengthy time
that it takes to construct the entire system.45 The amount
of revenue required for commercial viability will also vary from system
to system, particularly since there is no standard time-frame to
achieve commercial viability. Further, we are concerned that any
attempt to establish a lower percentage fee will be fraught with
endless discussion of what that percentage should be. The concept of
establishing separate categories for small and large constellations may
warrant consideration. However, further study is needed and more
systems need to be operational before we can properly evaluate its
appropriateness. For FY 1999, the fee payment criteria for NGSO systems
will remain unchanged.
---------------------------------------------------------------------------
\45\ Assessment and Collections of Regulatory Fees for Fiscal
Year 1997, 62 FR 37408 (July 11, 1997), at paragraph 75.
---------------------------------------------------------------------------
vii. Commercial Radio and Television
47. The National Association of Broadcasters (NAB) supports the
Commission's use of allocating fees for AM and FM stations based on
station class and population served by each station. According to NAB,
it received fewer complaints in 1998 after the Commission revised its
AM and FM station fee methodology. Although NAB acknowledges that the
Commission's 1998 fee methodology is a noticeable improvement from
1997, NAB argues that stations located in suburban areas, but close to
larger urban centers, are assessed a larger licensing fee simply
[[Page 35839]]
because they are located near larger advertising markets. For equitable
reasons, NAB urges the Commission to entertain requests for partial fee
waivers from stations that are located close to a larger listening
audience.
48. Although NAB supports the Commission on its allocation of fees
on an individual station basis, NAB disagrees with the Commission for
increasing the broadcast industry's overall fees by 9.4 percent rather
than by the 6% that Congress required the Commission to collect. NAB
acknowledges that the increase is a congressional requirement, but
feels that the 9.4% increase for the broadcast industry as a whole is
far greater than what Congress required of the Commission, particularly
since the number of payment units in the broadcast industry has
increased from the previous year. Furthermore, NAB also argues that the
Commission does not explain the basis of its costs in regulating the
broadcast industry, except by showing that the number of FY 1999
estimated units were multiplied by the FY 1998 fee, and pro-rated among
all existing fee categories. Hence, according to NAB, without these
calculations, it is not easily apparent whether the cost of regulating
the broadcast industry has actually increased or decreased, or whether
the broadcast industry is bearing the costs of regulating other aspects
of the communication industry. Finally, NAB also argues that the fruits
of the Commission's streamlining efforts should be incorporated into
the fee methodology, resulting in lower application and regulatory
fees.
49. With respect to NAB's request that partial fee waivers be
granted, the Commission's rules already provide for petitions for
waivers. We will consider such requests on an individual basis and on
the particular merits of the situation. Absent specific information to
indicate whether a waiver is warranted, it would be inappropriate to
guarantee results in favor of any group of broadcast licensees in
general herein.
50. Although the overall regulatory fee increase is approximately
6%, factoring in costs for exempt entities, overhead, and changes due
to increases or decreases in payment units could cause some shifting or
cross-subsidization, which means that application of the required
increase may not fall equally on every group of fee payers. Cost data
from our cost accounting system was reviewed before making the decision
not to apply the data across-the-board to all services as wholesale
permitted amendments. The use of the cost data in implementing this
cost shifting proved too extreme and would have required significantly
higher increases in several fee categories than the 9.4 percent that
NAB questions. This occurs because the actual costs attributable to
several other services would require fees that are as much as several
thousand percent above what it would be reasonable and fair to charge.
Also, a few services would have decreases in fees which would require
adding more costs to other services in order to collect the amount that
Congress requires us. Finally, as many other commenters, NAB argues
that its industry is being streamlined or deregulated. Nearly all
commenters have argued that deregulation has benefited one industry
over another. However, ultimately, it does not change the fact that we
must collect the full $172.5 million proportionately from all payers.
viii. Fee Filing Software
51. The Walt Disney Company states that while the Commission
prefers that payers of multiple fees file using FCC software, that
software has been plagued with errors and released too near the payment
deadline.
52. The Commission recognizes, and is striving to remedy, the
problems associated with the software and the late release last year.
We are planning to conduct beta testing and to release the ``fee
filer'' user software in July 1999, well in advance of the filing
deadline of mid-September. A Public Notice will be released including a
detailed description of the software application. Anyone wishing to
participate in the beta testing may contact Linwood Jenkins at (202)
418-1995.
53. Regulatees paying for more than 50 licenses may utilize the
``fee filer'' software, or complete the individual copies of the FCC
Form 159 and 159C. The FCC Form 159 must be completed in its entirety.
Improperly completing the FCC Form 159 and 159C will result in a delay
in crediting your account. These are the only two acceptable methods of
submission. The Commission will not accept any attachments listing call
signs. Each call sign must be listed separately on the Form 159/159C in
order to receive proper credit.
E. Procedures for Payment of Regulatory Fees
54. Generally, we will retain the procedures that we have
established for the payment of regulatory fees. Section 9(f) requires
that we permit ``payment by installments in the case of fees in large
amounts, and in the case of small amounts, shall require the payment of
the fee in advance for a number of years not to exceed the term of the
license held by the payer.'' See 47 U.S.C. 159(f)(1). Consistent with
section 9(f), we are again establishing three categories of fee
payments, based upon the category of service for which the fee payment
is due and the amount of the fee to be paid. The fee categories are (1)
``standard'' fees, (2) ``large'' fees, and (3) ``small'' fees.
i. Annual Payments of Standard Fees
55. As we have in the past, we are treating regulatory fee payments
by certain licensees as ``standard fees'' which are those regulatory
fees that are payable in full on an annual basis. Payers of standard
fees are not required to make advance payments for their full license
term and are not eligible for installment payments. All standard fees
are payable in full on the date we establish for payment of fees in
their respective regulatory fee category. The payment dates for each
regulatory fee category will be announced either in this Report and
Order terminating this proceeding or by public notice in the Federal
Register pursuant to authority delegated to the Managing Director.
ii. Installment Payments for Large Fees
56. As we noted in the NPRM, time constraints will preclude an
opportunity for installment payments. Due to statutory constraints
concerning notification to Congress prior to actual collection of the
fees, there will not be sufficient time for installment payments, and
regulatees eligible to make installment payments will be required to
pay these fees on the last date that fee payments may be submitted. The
dates for a single payment will be announced either in this Report and
Order terminating this proceeding or by public notice published in the
Federal Register pursuant to authority delegated to the Managing
Director.
iii. Advance Payments of Small Fees
57. As we have in the past, we are treating regulatory fee payments
by certain licensees as ``small'' fees subject to advance payment
consistent with the requirements of section 9(f)(2). Advance payments
will be required from licensees of those services that we decided would
be subject to advance payments in our FY 1994 Report and Order, and to
those additional payers set forth herein.46 Payers of
advance fees
[[Page 35840]]
will submit the entire fee due for the full term of their licenses when
filing their initial, renewal, or reinstatement application. Regulatees
subject to a payment of small fees shall pay the amount due for the
current fiscal year multiplied by the number of years in the term of
their requested license. In the event that the required fee is adjusted
following their payment of the fee, the payer would not be subject to
the payment of a new fee until filing an application for renewal or
reinstatement of the license. Thus, payment for the full license term
must be made based upon the regulatory fee applicable at the time the
application is filed. The effective date for payment of small fees
established in this proceeding will be announced in this Report and
Order terminating this proceeding or by public notice published in the
Federal Register pursuant to authority delegated to the Managing
Director.
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\46\ Applicants for new, renewal and reinstatement licenses in
the following services will be required to pay their regulatory fees
in advance: Land Mobile Services, Microwave Services, Marine (Ship)
Service, Marine (Coast) Service, Private Land Mobile (Other)
Services, Aviation (Aircraft) Service, Aviation (Ground) Service,
218-219 MHz Service (previously IVDS), and General Mobile Radio
Service (GMRS).
---------------------------------------------------------------------------
iv. Minimum Fee Payment Liability
58. As we have in the past, we are establishing that regulatees
whose total regulatory fee liability, including all categories of fees
for which payment is due by an entity, amounts to less than $10 will be
exempted from fee payment in FY 1999.
v. Standard Fee Calculations and Payment Dates
59. As noted, the time for payment of standard fees and any
installment payments will be announced in this Report and Order
terminating this proceeding or will be published in the Federal
Register pursuant to authority delegated to the Managing Director. For
licensees, permittees and holders of other authorizations in the Common
Carrier, Mass Media, and Cable Services, whose fees are not based on a
subscriber, unit, or circuit count, fees must be paid for any
authorization issued on or before October 1, 1998.47
---------------------------------------------------------------------------
\47\ Where a license or authorization is transferred or assigned
after October 1, 1998, the fee shall be paid by the licensee or
holder of the authorization on the date that the payment is due.
---------------------------------------------------------------------------
60. In the case of regulatees whose fees are based upon a
subscriber, unit or circuit count, the number of the regulatees'
subscribers, units or circuits on December 31, 1998, will be used to
calculate the fee payment.48
---------------------------------------------------------------------------
\48\ Cable system operators are to compute their subscribers as
follows: Number of single family dwellings + number of individual
households in multiple dwelling unit (apartments, condominiums,
mobile home parks, etc.) paying at the basic subscriber rate + bulk
rate customers + courtesy and free service. Note: BulkRate Customers
= Total annual bulk-rate charge divided by basic annual subscription
rate for individual households. Cable system operators may base
their count on ``a typical day in the last full week'' of December
1998, rather than on a count as of December 31, 1998.
---------------------------------------------------------------------------
vi. Improved Fee Collection Systems
61. The Commission is taking several steps to improve its fee
collection program. Development of a new fee collections system is
currently underway that will provide a single improved internal source
of information for all of the Commission's financial transactions. In
addition, we are establishing procedures that will require assignment
of a unique identifier code to each entity doing business with the FCC
to enable it to track payments and other transactions made by the
entity, even when its name or ownership changes. These enhancements
will assist the FCC in identifying all feeable entities and ensuring
that proper payments are received and recorded accurately.
vii. Late or Insufficient Regulatory Fee Payment
62. As a reminder, in accordance with section 1.1164 of the
Commission's Rules, regulatees will be subject to a 25 percent penalty
for late or insufficient regulatory fee payment. All payments not
received by the due date shall be assessed the penalty.
F. Schedule of Regulatory Fees
63. The Commission's Schedule of Regulatory Fees for FY 1999 is
contained in Attachment D of this Report and Order.
IV. Procedural Matters
A. Ordering Clause
64. Accordingly, it is ordered that the rule changes specified
herein are adopted. It is further ordered that the rule changes made
herein will become effective 60 days from the date of publication in
the Federal Register, except that changes to the Schedule of Regulatory
Fees made pursuant to section 9(b)(3) of the Communications Act, and
incorporating regulatory fees for FY 1999, will become effective
September 10, 1999, which is 90 days from the date of notification to
Congress. A Final Regulatory Flexibility Analysis (FRFA) has been
performed and is found in Attachment A, and it is ordered that the
Office of Public Affairs send this to Small Business Administration.
Finally, it is ordered that this proceeding is Terminated.
B. Authority and Further Information
65. This action is taken pursuant to sections 4(i) and (j), 9, and
303(r) of the Communications Act of 1934, as amended,49 47
U.S.C. 154(i) and (j), 9, and 303(r).
---------------------------------------------------------------------------
\49\ 47 U.S.C. 154(i)-(j), 159, & 303(r).
---------------------------------------------------------------------------
66. Further information about this proceeding may be obtained by
contacting the Fees Hotline at (202) 418-0192.
List of Subjects in 47 CFR Part 1
Administrative practice and procedure, Communications common
carriers, Radio, Telecommunications, Television.
Federal Communications Commission.
Magalie Roman Salas,
Secretary.
Rule Changes
For the reasons discussed in the preamble, part 1 of Title 47 of
the Code of Federal Regulations is amended as follows:
PART 1--PRACTICE AND PROCEDURE
1. The authority citation for Part 1 continues to read as follows:
Authority: 15 U.S.C. 79 et seq.; 47 U.S.C. 151, 154(i), 154(j),
155, 225, and 303(r).
2. Sec. 1.1152 is revised to read as follows:
Sec. 1.1152 Schedule of annual regulatory fees and filing locations
for wireless radio services.
------------------------------------------------------------------------
Exclusive use services (per
license) Fee amount \1\ Address
------------------------------------------------------------------------
1. Land Mobile (Above 470 MHz,
Base Station and SMRS) (47
CFR, Part 90).
(a) 800 MHz, New, Renewal, $13.00 FCC, 800 MHz, P.O. Box
Reinstatement (FCC 600). 358130, Pittsburgh, PA
15251-5130.
[[Page 35841]]
(b) 900 MHz, New, Renewal, 13.00 FCC, 900 MHz, P.O. Box
Reinstatement (FCC 600). 358130, Pittsburgh, PA
15251-5130.
(c) 470-512,800,900, 220 13.00 FCC, 470-512, P.O. Box
MHz, 220 MHz Nationwide 358245, Pittsburgh, PA
Renewal (FCC 574R, FCC 15251-5245.
405A).
(d) Correspondence Blanket 13.00 FCC, Corres., P.O. Box
Renewal (470- 358130, Pittsburgh, PA
512,800,900,220 MHz) 15251-5130.
(Remittance Advice,
Correspondence).
(e) 220 MHz, New, Renewal, 13.00 FCC, 220 MHz, P.O. Box
Reinstatement (FCC 600). 358130, Pittsburgh, PA
15251-5130.
(f) 470-512 MHz New, 13.00 FCC, 470-512 P.O. Box
Renewal, Reinstatement 358130, Pittsburgh, PA
(FCC 600). 15251-5130.
(g) 220 MHz Nationwide, 13.00 FCC, Nationwide, P.O.
New, Renewal, Box 358130,
Reinstatement (FCC 600). Pittsburgh, PA 15251-
5130.
2. Microwave (47 CFR Pt. 101):
(a) Microwave, New, 13.00 FCC, Microwave, P.O.
Renewal, Reinstatement Box 358130,
(FCC 415). Pittsburgh, PA 15251-
5130.
(b) Microwave, Renewal (FCC 13.00 FCC, Microwave, P.O.
402R). Box 358255,
Pittsburgh, PA 15251-
5255.
(c) Correspondence,s 13.00 FCC, Corres., P.O. Box
Blanket Renewal 358130, Pittsburgh, PA
(Microwave) (Remittance 15251-5130.
Advice, Correspondence).
3. 218-219 MHz Service:
(a) New, Renewal (FCC 574 13.00 FCC, 218-219 MHz
or FCC 600). Service, P.O. Box
358130, Pittsburgh, PA
15251-5130.
4. Shared Use Services:
(a) Land Transportation 7.00 FCC, Land Trans., P.O.
(LT), New, Renewal, Box 358130,
Reinstatement (FCC 600). Pittsburgh, PA 15251-
5130.
(b) Business (Bus.) New, 7.00 FCC, Business, P.O. Box
Renewal, Reinstatement 358130, Pittsburgh, PA
(FCC 600). 15251-5130.
(c) Other Industrial (OI), 7.00 FCC, Other Indus., P.O.
New, Renewal, Box 358130,
Reinstatement (FCC 600). Pittsburgh, PA 15251-
5130.
(d) General Mobile Radio 7.00 FCC, GMRS P.O. Box
Service (GMRS), New, 358130, Pittsburgh, PA
Renewal, Modifications 15251-5130.
(RM) (FCC 605).
(e) Business, Other 7.00 FCC, Bus., OI, LT, P.O.
Industrial, Land Box 358245,
Transportation, Renewal Pittsburgh, PA 15251-
(FCC 574R, FCC 405A). 5245.
(f) GMRS Renewal (RO) (FCC 7.00 FCC,GMRS, P.O. Box
605). 358245, Pittsburgh, PA
15251-5245.
(g) Ground, New, Renewal, 7.00 FCC, Ground, P.O. Box
Reinstatement (FCC 406). 358130, Pittsburgh, PA
15251-5130.
(h) Coast, New, Renewal, 7.00 FCC, Coast, P.O. Box
Reinstatement (FCC 503). 358130, Pittsburgh, PA
15251-5130.
(i) Ground, Renewal (FCC 7.00 FCC, Ground, P.O. Box
452R). 358270, Pittsburgh, PA
15251-5270.
(j) Coast, Renewal (FCC 7.00 FCC, Coast, P.O. Box
452R). 358270, Pittsburgh, PA
15251-5270.
(k) Ship, New, Renewal, 7.00 FCC, Ship, P.O. Box
Reinstatement (FCC 506). 358130, Pittsburgh, PA
15251-5130.
(l) Aircraft, New, 7.00 FCC, Aircraft, P.O. Box
Renewal,Modification (RM), 358130 Pittsburgh, PA
Reinstatement (FCC 605). 15251-5130.
(m) Ship, Renewal (FCC 7.00 FCC, Ship, P.O. Box
405B). 358290, Pittsburgh, PA
15251-5290.
(n) Aircraft, Renewal (RO) 7.00 FCC, Aircraft, P.O. Box
(FCC 605). 358245, Pittsburgh, PA
15251-5245.
(o) Correspondence, Blanket 7.00 FCC, Corres. P.O. Box
Renewal (Bus.,OI,LT) 358130, Pittsburgh, PA
(Remittance Advice, 15251-5130.
Correspondence).
(p) Correspondence, Blanket 7.00 FCC, Corres., P.O. Box
Renewal (Ground) 358130, Pittsburgh, PA
(Remittance Advice, 15251-5130.
Correspondence).
(q) Correspondence, Blanket 7.00 FCC, Corres., P.O. Box
Renewal (Coast) 358130, Pittsburgh, PA
(Remittance Advice, 15251-5130.
Correspondence).
(r) Correspondence, Blanket 7.00 FCC, Corres., P.O. Box
Renewal (Ship) (Remittance 358130, Pittsburgh, PA
Advice, Correspondence). 15251-5130.
5. Amateur Vanity Call Signs... 1.40 FCC, Amateur Vanity,
P.O. Box 358924,
Pittsburgh, PA 15251-
5924.
6. CMRS Mobile Services, (per .32 FCC, Cellular, P.O. Box
unit). 358835, Pittsburgh, PA
15251-5835.
7. CMRS Messaging Services (per .04 FCC, Messaging, P.O.
unit). Box 358835,
Pittsburgh, PA 15251-
5835.
------------------------------------------------------------------------
\1\ Note that small fees are collected in advance for the entire license
term. Therefore, the annual fee amount shown in this table must be
multiplied by the 5-or 10-year license term, as appropriate, to arrive
at the total amount of regulatory fees owed. It should be further
noted that application fees may also apply as detailed in Section
1.1102 of this chapter.
3. Sec. 1.1153 is revised to read as follows:
Sec. 1.1153 Schedule of annual regulatory fees and filing locations
for mass media services.
------------------------------------------------------------------------
Fee amount Address
------------------------------------------------------------------------
I. Radio [AM and FM] (47 CFR,
Part 73)
1. AM Class A:
1,000,000 population.. 4,400
2. AM Class B:
1,000,000 population.. 3,600
3. AM Class C:
1,000,000 population.. 1,750
4. AM Class D:
1,000,000 population.. 2,250
5. AM Construction Permit.. 260
6. FM Classes A, B1 and C3:
1,000,000 population.. 3,600
7. FM Classes B, C, C1 and
C2:
1,000,000 population.. 4,400
8. FM Construction Permits. 780
II. TV (47 CFR, Part 73) VHF
Commercial:
1. Markets 1 thru 10....... 41,225 FCC, TV Branch, P.O.
Box 358835,
Pittsburgh, PA, 15251-
5835.
2. Markets 11 thru 25...... 34,325
3. Markets 26 thru 50...... 23,475
4. Markets 51 thru 100..... 13,150
5. Remaining Markets....... 3,400
6. Construction Permits.... 2,775
III. TV (47 CFR, Part 73) UHF
Commercial:
1. Markets 1 thru 10....... 15,550 FCC, UHF Commercial,
P.O. Box 358835,
Pittsburgh, PA, 15251-
5835.
2. Markets 11 thru 25...... 11,775
3. Markets 26 thru 50...... 7,300
4. Markets 51 thru 100..... 4,350
5. Remaining Markets....... 1,175
6. Construction Permits.... 2,900
IV. TV (47 CFR, Part 73)
Satellite UHF/VHF Commercial:
1. All Markets............. 1,300 FCC Satellite TV, P.O.
Box 358835 Pittsburgh,
PA 15251-5835.
2. Construction Permits.... 460
V. Low Power TV, TV/FM 290 FCC, Low Power, P.O.
Translator,& TV/FM Booster (47 Box 358835,
CFR, Part 74). Pittsburgh, PA 15251-
5835.
VI. Broadcast Auxiliary........ 12 FCC, Auxiliary, P.O.
Box 358835,
Pittsburgh, PA 15251-
5835.
VII. Multipoint Distribution... 285 FCC, Multipoint, P.O.
Box 358835,
Pittsburgh, PA 15251-
5835.
------------------------------------------------------------------------
4. Sec. 1.1154 is revised to read as follows:
Sec. 1.1154 Schedule of annual regulatory charges and filing locations
for common carrier services.
------------------------------------------------------------------------
Fee amount Address
------------------------------------------------------------------------
I. Radio Facilities:
1. Microwave (Domestic $13 FCC, Common Carrier,
Public Fixed). P.O. Box 358130,
Pittsburgh, PA 15251-
5130.
II. Carriers:
[[Page 35843]]
1. Interstate Telephone .00121 FCC, Carriers, P.O. Box
Service Providers (per 358835, Pittsburgh,
dollar contributed to TRS PA.
Fund).
------------------------------------------------------------------------
5. Sec. 1.1155 is revised to read as follows:
Sec. 1.1155 Schedule of regulatory fees and filing locations for cable
television services.
------------------------------------------------------------------------
Fee amount Address
------------------------------------------------------------------------
1. Cable Antenna Relay Service. $55 FCC, Cable, P.O. Box
358835, Pittsburgh, PA
15251-5835
2. Cable TV System (per .48
subscriber).
------------------------------------------------------------------------
6. Section 1.1156 is revised to read as follows:
Sec. 1.1156 Schedule of regulatory fees and filing locations for
international services.
------------------------------------------------------------------------
Fee amount Address
------------------------------------------------------------------------
I. Radio Facilities:
1. International (HF) $520 FCC, International,
Broadcast. P.O. Box 358835,
Pittsburgh, PA 15251-
5835.
2. International Public 410 FCC, International,
Fixed. P.O. Box 358835
Pittsburgh, PA 15251-
5835.
II. Space Stations 130,550 FCC, Space Stations,
(Geostationary Orbit). P.O. Box 358835,
Pittsburgh, PA 15251-
5835.
III. Space Stations (Non- 180,800 FCC, Space Stations,
Geostationary Orbit). P.O. Box 358835,
Pittsburgh, PA 15251-
5835.
IV. Earth Stations Transmit/ 180 FCC, Earth Station,
Receive and Transmit Only (per P.O. Box 358835,
authorization or registration). Pittsburgh, PA 15251-
5835.
V. Carriers:
1. International Bearer 7.00 FCC, International,
Circuits (per active 64KB P.O. Box 358835,
circuit or equivalent). Pittsburgh, PA 15251-
5835.
------------------------------------------------------------------------
Note: The following attachments will not appear in the Code of
Federal Regulations.
Attachment A--Final Regulatory Flexibility Analysis
1. As required by the Regulatory Flexibility Act (RFA),
50-51 an Initial Regulatory Flexibility Analysis (IRFA)
was incorporated in the Notice of Proposed Rulemaking, In the Matter
of Assessment and Collection of Regulatory Fees for Fiscal Year
1999, 64 FR 16661 (Apr. 6, 1999). The Commission sought written
public comments on the proposals in its FY 1999 regulatory fees
NPRM, including on the IRFA. This present Final Regulatory
Flexibility Analysis (FRFA) conforms to the RFA, as amended (see 5
U.S.C. 604).
---------------------------------------------------------------------------
\50-51\ 5 U.S.C. 603. The RFA, 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).
---------------------------------------------------------------------------
I. Need for, and Objectives of, the Rules
2. This rulemaking proceeding was initiated in order to collect
regulatory fees in the amount of $172,523,000, the amount that
Congress has required the Commission to recover through the
collection of regulatory fees in FY 1999. The Commission seeks to
collect the necessary amount through its revised regulatory fees, as
contained in the attached Schedule of Regulatory Fees, in the most
efficient manner possible and without undue burden on the public.
II. Summary of Significant Issues Raised by Public Comments in Response
to the IRFA
3. None.
III. Description and Estimate of the Number of Small Entities to Which
the Rules Will Apply
4. The RFA directs agencies to provide a description of and,
where feasible, an estimate of the number of small entities that may
be affected by the proposed rules, if adopted.52 The RFA
generally defines the term ``small entity'' as having the same
meaning as the terms ``small business,'' ``small organization,'' and
``small governmental jurisdiction.'' 53 In addition, the
term ``small business'' has the same meaning as the term ``small
business concern'' under the Small Business Act.54 A
small business concern is one which: (1) is independently owned and
operated; (2) is not dominant in its field of operation; and (3)
satisfies any additional criteria established by the Small Business
Administration (SBA).55 A small organization is generally
``any not-for-profit enterprise which is independently owned and
operated and is not dominant in its field.'' 56
Nationwide, as of 1992, there were approximately 275,801 small
organizations.57 ``Small governmental jurisdiction''
generally means ``governments of cities, counties, towns, townships,
villages, school districts, or special districts, with a population
of less than 50,000.'' 58 As of 1992, there were
approximately 85,006 such jurisdictions in the United
States.59 This number includes 38,978 counties, cities,
and towns; of these, 37,566, or 96 percent, have populations of
fewer than 50,000.60 The Census Bureau estimates that
this ratio is approximately accurate for all governmental entities.
Thus, of the 85,006 governmental entities, we estimate that 81,600
(91 percent) are small entities. Below, we further describe and
estimate the number of small entity licensees and regulatees that
may be affected by the rules, herein adopted.
---------------------------------------------------------------------------
\52\ 5 U.S.C. 603(b)(3).
\53\ Id. 601(6).
\54\ 5 U.S.C. 601(3) (incorporating by reference the definition
of ``small business concern'' in 15 U.S.C. 632). Pursuant to the
RFA, the statutory definition of a small business applies ``unless
an agency, after consultation with the Office of Advocacy of the
Small Business Administration and after opportunity for public
comment, establishes one or more definitions of such term which are
appropriate to the activities of the agency and publishes such
definition(s) in the Federal Register.'' 5 U.S.C. 601(3).
\55\ Small Business Act, 15 U.S.C. 632 (1996).
\56\ 5 U.S.C. 601(4).
\57\ 1992 Economic Census, U.S. Bureau of the Census, Table 6
(special tabulation of data under contract to Office of Advocacy of
the U.S. Small Business Administration).
\58\ 5 U.S.C. 601(5).
\59\ U.S. Dept. of Commerce, Bureau of the Census, ``1992 Census
of Governments.''
\60\ Id.
---------------------------------------------------------------------------
Cable Services for Systems
5. The SBA has developed a definition of small entities for
cable and other pay television services, which includes all such
companies generating $11 million or less in
[[Page 35844]]
revenue annually.61 This definition includes cable
systems operators, closed circuit television services, direct
broadcast satellite services, multipoint distribution systems,
satellite master antenna systems and subscription television
services. According to the Census Bureau data from 1992, there were
1,788 total cable and other pay television services and 1,423 had
less than $11 million in revenue.62
---------------------------------------------------------------------------
\61\ 13 CFR 121.201, SIC code 4841.
\62\ 1992 Economic Census Industry and Enterprise Receipts Size
Report, Table 2D, SIC code 4841 (U.S. Bureau of the Census data
under contract to the Office of Advocacy of the U.S. Small Business
Administration).
---------------------------------------------------------------------------
6. The Commission has developed its own definition of a small
cable system operator for purposes of rate regulation. Under the
Commission's rules, a ``small cable company'' is one serving fewer
than 400,000 subscribers nationwide.63 Based on our most
recent information, we estimate that there were 1,439 cable
operators that qualified as small cable system operators at the end
of 1995.64 Since then, some of those companies may have
grown, and others may have been involved in transactions that caused
them to be combined with other cable operators. Consequently, we
estimate that there are fewer than 1,439 small entity cable system
operators.
---------------------------------------------------------------------------
\63\ 47 CFR 76.901(e). The Commission developed this definition
based on its determination that a small cable system operator is one
with annual revenues of $100 million or less. Implementation of
Sections of the 1992 Cable Act: Rate Regulation, Sixth Report and
Order and Eleventh Order on Reconsideration, 10 FCC Rcd 7393 (1995),
60 FR 10534 (Feb. 27, 1995).
\64\ Paul Kagan Associates, Inc., Cable TV Investor, Feb. 29,
1996 (based on figures for Dec. 30, 1995).
---------------------------------------------------------------------------
7. The Communications Act also contains a definition of a small
cable system operator, which is ``a cable operator that, directly or
through an affiliate, serves in the aggregate fewer than 1 percent
of all subscribers in the United States and is not affiliated with
any entity or entities whose gross annual revenues in the aggregate
exceed $250,000,000.'' 65 The Commission has determined
that there are 64,000,000 subscribers in the United States.
Therefore, we found that an operator serving fewer than 617,000
subscribers shall be deemed a small operator, if its annual
revenues, when combined with the total annual revenues of all of its
affiliates, do not exceed $250 million in the aggregate.
66 Based on available data, we find that the number of
cable operators serving 617,000 subscribers or less totals 1,450.
67 We do not request nor do we collect information
concerning whether cable system operators are affiliated with
entities whose gross annual revenues exceed $250,000,000,
68 and thus are unable at this time to estimate with
greater precision the number of cable system operators that would
qualify as small cable operators under the definition in the
Communications Act. It should be further noted that recent industry
estimates project that there will be a total 64,000,000 subscribers,
and we have based our fee revenue estimates on that figure.
---------------------------------------------------------------------------
\65\ 47 U.S.C. 543(m)(2).
\66\ Id. 76.1403(b).
\67\ Paul Kagan Associates, Inc., Cable TV Investor, Feb. 29,
1996 (based on figures for Dec. 30, 1995).
\68\ We do receive such information on a case-by-case basis only
if a cable operator appeals a local franchise authority's finding
that the operator does not qualify as a small cable operator
pursuant to section 76.1403(b) of the Commission's rules. See 47 CFR
76.1403(d).
---------------------------------------------------------------------------
8. Other Pay Services. Other pay television services are also
classified under Standard Industrial Classification (SIC) 4841,
which includes cable systems operators, closed circuit television
services, direct broadcast satellite services (DBS), 69
multipoint distribution systems (MDS), 70 satellite
master antenna systems (SMATV), and subscription television
services.
---------------------------------------------------------------------------
\69\ Direct Broadcast Services (DBS) are discussed with the
international services, infra.
\70\ Multipoint Distribution Services (MDS) are discussed with
the mass media services, infra.
---------------------------------------------------------------------------
Common Carrier Services and Related Entities
9. The most reliable source of information regarding the total
numbers of certain common carrier and related providers nationwide,
as well as the number of commercial wireless entities, appears to be
data the Commission publishes in its Trends in Telephone Service
report.71 According to data in the most recent report,
there are 3,528 interstate carriers.72 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.
---------------------------------------------------------------------------
\71\ FCC, Common Carrier Bureau, Industry Analysis Division,
Trends in Telephone Service, Table 19.3 (February 19, 1999).
\72\ Id.
---------------------------------------------------------------------------
10. The SBA has defined establishments engaged in providing
``Radiotelephone Communications'' and ``Telephone Communications,
Except Radiotelephone'' to be small businesses when they have no
more than 1,500 employees.73 Below, we discuss the total
estimated number of telephone companies falling within the two
categories and the number of small businesses in each, and we then
attempt to refine further those estimates to correspond with the
categories of telephone companies that are commonly used under our
rules.
---------------------------------------------------------------------------
\73\ 13 CFR 121.201, Standard Industrial Classification (SIC)
codes 4812 and 4813. See also Executive Office of the President,
Office of Management and Budget, Standard Industrial Classification
Manual (1987).
---------------------------------------------------------------------------
11. 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.'' 74
---------------------------------------------------------------------------
\74\ 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 (Aug. 29,
1996), the Commission has consistently addressed in its regulatory
flexibility analyses the impact of its rules on such ILECs.
---------------------------------------------------------------------------
12. Total Number of Telephone Companies Affected. The U.S.
Bureau of the Census (``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.75
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,
covered specialized mobile radio providers, and resellers. It seems
certain that some of these 3,497 telephone service firms may not
qualify as small entities or small ILECs because they are not
``independently owned and operated.'' 76 For example, a
reseller that is affiliated with an interexchange carrier having
more than 1,500 employees would not meet the definition of a small
business. It is reasonable to conclude that fewer than 3,497
telephone service firms are small entity telephone service firms or
small ILECs that may be affected by the rules, herein adopted.
---------------------------------------------------------------------------
\75\ U.S. 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).
\76\ See generally 15 U.S.C. 632(a)(1).
---------------------------------------------------------------------------
13. Wireline Carriers and Service Providers. The SBA has
developed a definition of small entities for telephone
communications companies except radiotelephone (wireless) companies.
The Census Bureau reports that there were 2,321 such telephone
companies in operation for at least one year at the end of
1992.77 According to the SBA's definition, a small
business telephone company other than a radiotelephone company is
one employing no more than 1,500 persons.78 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 ILECs. We do not have data specifying the
number of these carriers that are not independently owned and
operated, and thus 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 the SBA's definition.
Consequently, we estimate that fewer than 2,295 small telephone
communications companies other than radiotelephone companies are
small entities
[[Page 35845]]
or small ILECs that may be affected by the rules, herein adopted.
---------------------------------------------------------------------------
\77\ 1992 Census, supra, at Firm Size 1-123.
\78\ 13 CFR 121.201, SIC code 4813.
---------------------------------------------------------------------------
14. Local Exchange Carriers. Neither the Commission nor the SBA
has developed a definition for small providers of local exchange
services (LECs). The closest applicable definition under the SBA
rules is for telephone communications companies other than
radiotelephone (wireless) companies.79 According to the
most recent Telecommunications Industry Revenue data, 1,410 carriers
reported that they were engaged in the provision of local exchange
services.80 We do not have data specifying the number of
these carriers that are either dominant in their field of
operations, 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 LECs that would qualify as
small business concerns under the SBA's definition. Consequently, we
estimate that fewer than 1,410 providers of local exchange service
are small entities or small ILECs that may be affected by the rules,
herein adopted.
---------------------------------------------------------------------------
\79\ Id.
\80\ Trends in Telephone Service, Table 19.3 (February 19,
1999).
---------------------------------------------------------------------------
15. Interexchange Carriers. Neither the Commission nor the SBA
has developed a definition of small entities specifically applicable
to providers of interexchange services (IXCs). The closest
applicable definition under the SBA rules is for telephone
communications companies other than radiotelephone (wireless)
companies.81 According to the most recent Trends in
Telephone Service data, 151 carriers reported that they were engaged
in the provision of interexchange services.82 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 IXCs that would qualify as small business concerns
under the SBA's definition. Consequently, we estimate that there are
fewer than 151 small entity IXCs that may be affected by the rules,
herein adopted.
---------------------------------------------------------------------------
\81\ 13 CFR 121.201, SIC code 4813.
\82\ Trends in Telephone Service, Table 19.3 (February 19,
1999).
---------------------------------------------------------------------------
16. Competitive Access Providers. Neither the Commission nor the
SBA has developed a definition of small entities specifically
applicable to competitive access services providers (CAPs). The
closest applicable definition under the SBA rules is for telephone
communications companies other than except radiotelephone (wireless)
companies.83 According to the most recent Trends in
Telephone Service data, 147 carriers reported that they were engaged
in the provision of competitive local exchange
services.84 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 CAPs that would
qualify as small business concerns under the SBA's definition.
Consequently, we estimate that there are fewer than 147 small entity
CAPs that may be affected by the rules, herein adopted.
---------------------------------------------------------------------------
\83\ 13 CFR 121.201, SIC code 4813.
\84\ Trends in Telephone Service, Table 19.3 (February 19,
1999).
---------------------------------------------------------------------------
17. Operator Service Providers. Neither the Commission nor the
SBA has developed a definition of small entities specifically
applicable to providers of operator services. The closest applicable
definition under the SBA rules is for telephone communications
companies other than radiotelephone (wireless)
companies.85 According to the most recent Trends in
Telephone Service data, 32 carriers reported that they were engaged
in the provision of operator services.86 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 operator service providers that would qualify as small
business concerns under the SBA's definition. Consequently, we
estimate that there are fewer than 32 small entity operator service
providers that may be affected by the rules, herein adopted.
---------------------------------------------------------------------------
\85\ 13 CFR 121.201, SIC code 4813.
\86\ Trends in Telephone Service, Table 19.3 (February 19,
1999).
---------------------------------------------------------------------------
18. Pay Telephone Operators. Neither the Commission nor the SBA
has developed a definition of small entities specifically applicable
to pay telephone operators. The closest applicable definition under
SBA rules is for telephone communications companies other than
radiotelephone (wireless) companies.87 According to the
most recent Trends in Telephone Service data, 509 carriers reported
that they were engaged in the provision of pay telephone
services.88 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 pay telephone
operators that would qualify as small business concerns under the
SBA's definition. Consequently, we estimate that there are fewer
than 509 small entity pay telephone operators that may be affected
by the rules, herein adopted.
---------------------------------------------------------------------------
\87\ 13 CFR 121.201, SIC code 4813.
\88\ Trends in Telephone Service, Table 19.3 (February 19,
1999).
---------------------------------------------------------------------------
19. Resellers (including debit card providers). Neither the
Commission nor the SBA has developed a definition of small entities
specifically applicable to resellers. The closest applicable SBA
definition for a reseller is a telephone communications company
other than radiotelephone (wireless) companies.89
According to the most recent Trends in Telephone Service data, 358
reported that they were engaged in the resale of telephone
service.90 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 resellers that would
qualify as small business concerns under the SBA's definition.
Consequently, we estimate that there are fewer than 358 small entity
resellers that may be affected by the rules, herein adopted.
---------------------------------------------------------------------------
\89\ 13 CFR 121.201, SIC code 4813.
\90\ Trends in Telephone Service, Table 19.3 (February 19,
1999).
---------------------------------------------------------------------------
20. 800 and 800-Like Service Subscribers.91 Neither
the Commission nor the SBA has developed a definition of small
entities specifically applicable to 800 and 800-like service (``toll
free'') subscribers. The most reliable source of information
regarding the number of these service subscribers appears to be data
the Commission collects on the 800, 888, and 877 numbers in
use.92 According to our most recent data, at the end of
January 1999, the number of 800 numbers assigned was 7,692,955; the
number of 888 numbers that had been assigned was 7,706,393; and the
number of 877 numbers assigned was 1,946,538. We do not have data
specifying the number of these subscribers 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 toll free subscribers that would qualify as small
business concerns under the SBA's definition. Consequently, we
estimate that there are fewer than 7,692,955 small entity 800
subscribers, fewer than 7,706,393 small entity 888 subscribers, and
fewer than 1,946,538 small entity 877 subscribers may be affected by
the rules, herein adopted.
---------------------------------------------------------------------------
\91\ We include all toll-free number subscribers in this
category, including 888 numbers.
\92\ FCC, CCB Industry Analysis Division, FCC Releases, Study on
Telephone Trends, Tbls. 21.2, 21.3 and 21.4 (February 19, 1999).
---------------------------------------------------------------------------
International Services
21. The Commission has not developed a definition of small
entities applicable to licensees in the international services.
Therefore, the applicable definition of small entity is generally
the definition under the SBA rules applicable to Communications
Services, Not Elsewhere Classified (NEC).93 This
definition provides that a small entity is expressed as one with
$11.0 million or less in annual receipts.94 According to
the Census Bureau, there were a total of 848 communications services
providers, NEC, in operation in 1992, and a total of 775 had annual
receipts of less than $9.999 million.95 The Census report
does not provide more precise data.
---------------------------------------------------------------------------
\93\ An exception is the Direct Broadcast Satellite (DBS)
Service, infra.
\94\ 13 CFR 120.121, SIC code 4899.
\95\ 1992 Economic Census Industry and Enterprise Receipts Size
Report, Table 2D, SIC code 4899 (U.S. Bureau of the Census data
under contract to the Office of Advocacy of the U.S. Small Business
Administration).
---------------------------------------------------------------------------
22. International Broadcast Stations. Commission records show
that there are 20 international broadcast station licensees. We do
not request nor collect annual revenue information, and thus are
unable to estimate the number of international broadcast licensees
that would constitute a small business under the SBA definition.
However, the Commission estimates that only six international
broadcast stations are subject to regulatory fee payments.
[[Page 35846]]
23. International Public Fixed Radio (Public and Control
Stations). There are 3 licensees in this service subject to payment
of regulatory fees. We do not request nor collect annual revenue
information, and thus are unable to estimate the number of
international broadcast licensees that would constitute a small
business under the SBA definition.
24. Fixed Satellite Transmit/Receive Earth Stations. Based on
actual payments from FY 1998, there are approximately 3,100 earth
station authorizations, a portion of which are Fixed Satellite
Transmit/Receive Earth Stations. We do not request nor collect
annual revenue information, and thus are unable to estimate the
number of the earth stations that would constitute a small business
under the SBA definition.
25. Fixed Satellite Small Transmit/Receive Earth Stations. There
are 3,100 earth station authorizations, a portion of which are Fixed
Satellite Small Transmit/Receive Earth Stations. We do not request
nor collect annual revenue information, and thus are unable to
estimate the number of fixed satellite transmit/receive earth
stations that would constitute a small business under the SBA
definition.
26. Fixed Satellite Very Small Aperture Terminal (VSAT) Systems.
These stations operate on a primary basis, and frequency
coordination with terrestrial microwave systems is not required.
Thus, a single ``blanket'' application may be filed for a specified
number of small antennas and one or more hub stations. The
Commission has processed 377 applications. We do not request nor
collect annual revenue information, and thus are unable to estimate
the number of VSAT systems that would constitute a small business
under the SBA definition.
27. Mobile Satellite Earth Stations. There are 11 licensees. We
do not request nor collect annual revenue information, and thus are
unable to estimate the number of mobile satellite earth stations
that would constitute a small business under the SBA definition.
28. Radio Determination Satellite Earth Stations. There are four
licensees. We do not request nor collect annual revenue information,
and thus are unable to estimate the number of radio determination
satellite earth stations that would constitute a small business
under the SBA definition.
29. Space Stations (Geostationary). Commission records reveal
that there are 43 Geostationary Space Station licensees. We do not
request nor collect annual revenue information, and thus are unable
to estimate the number of geostationary space stations that would
constitute a small business under the SBA definition.
30. Space Stations (Non-Geostationary). There are 12 Non-
Geostationary Space Station licensees, of which only two systems are
operational. We do not request nor collect annual revenue
information, and thus are unable to estimate the number of non-
geostationary space stations that would constitute a small business
under the SBA definition.
31. Direct Broadcast Satellites. Because DBS provides
subscription services, DBS falls within the SBA-recognized
definition of ``Cable and Other Pay Television Services.''
96 This definition provides that a small entity is one
with $11.0 million or less in annual receipts.97 As of
December 1996, there were eight DBS licensees. However, the
Commission does not collect annual revenue data for DBS and,
therefore, is unable to ascertain the number of small DBS licensees
that would be impacted by these proposed rules. Although DBS service
requires a great investment of capital for operation, there are
several new entrants in this field that may not yet have generated
$11 million in annual receipts, and therefore may be categorized as
small businesses, if independently owned and operated.
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\96\ 13 CFR 120.121, SIC code 4841.
\97\ 13 CFR 121.201, SIC code 4841.
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Mass Media Services
32. Commercial Radio and Television Services. The proposed rules
and policies will apply to television broadcasting licensees and
radio broadcasting licensees.98 The SBA defines a
television broadcasting station that has $10.5 million or less in
annual receipts as a small business.99 Television
broadcasting stations consist of establishments primarily engaged in
broadcasting visual programs by television to the public, except
cable and other pay television services.100 Included in
this industry are commercial, religious, educational, and other
television stations.101 Also included are establishments
primarily engaged in television broadcasting and which produce taped
television program materials.102 Separate establishments
primarily engaged in producing taped television program materials
are classified under another SIC number.103 There were
1,509 television stations operating in the nation in
1992.104 That number has remained fairly constant as
indicated by the approximately 1,564 operating television
broadcasting stations in the nation as of December 31,
1997.105 For 1992,106 the number of television
stations that produced less than $10.0 million in revenue was 1,155
establishments.107 Only commercial stations are subject
to regulatory fees.
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\98\ While we tentatively believe that the SBA's definition of
``small business'' greatly overstates the number of radio and
television broadcast stations that are small businesses and is not
suitable for purposes of determining the impact of the proposals on
small television and radio stations, for purposes of this Notice we
utilize the SBA's definition in determining the number of small
businesses to which the proposed rules would apply. We reserve the
right to adopt, in the future, a more suitable definition of ``small
business'' as applied to radio and television broadcast stations or
other entities subject to the proposed rules in this Notice, and to
consider further the issue of the number of small entities that are
radio and television broadcasters or other small media entities. See
Report and Order in MM Docket No. 93-48 (Children's Television
Programming), 11 FCC Rcd 10660, 10737-38 (1996), 61 FR 43981 (Aug.
27, 1996), citing 5 U.S.C. 601(3).
\99\ 13 CFR 121.201, SIC code 4833.
\100\ Economics and Statistics Administration, Bureau of Census,
U.S. Department of Commerce, 1992 Census of Transportation,
Communications and Utilities, Establishment and Firm Size, Series
UC92-S-1, Appendix A-9 (1995) (1992 Census, Series UC92-S-1).
\101\ Id.; see Executive Office of the President, Office of
Management and Budget, Standard Industrial Classification Manual
(1987), at 283, which describes ``Television Broadcasting Stations''
(SIC code 4833) as:
Establishments primarily engaged in broadcasting visual programs
by television to the public, except cable and other pay television
services. Included in this industry are commercial, religious,
educational and other television stations. Also included here are
establishments primarily engaged in television broadcasting and
which produce taped television program materials.
\102\ 1992 Census, Series UC92-S-1, at Appendix A-9.
\103\ Id., SIC code 7812 (Motion Picture and Video Tape
Production); SIC code 7922 (Theatrical Producers and Miscellaneous
Theatrical Services) (producers of live radio and television
programs).
\104\ FCC News Release No. 31327 (Jan. 13, 1993); 1992 Census,
Series UC92-S-1, at Appendix A-9.
\105\ FCC News Release, ``Broadcast Station Totals as of Dec.
31, 1997.''
\106\ A census to determine the estimated number of
Communications establishments is performed every five years, in
years ending with a ``2'' or ``7.'' See 1992 Census, Series UC92-S-
1, at III.
\107\ The amount of $10 million was used to estimate the number
of small business establishments because the relevant Census
categories stopped at $9,999,999 and began at $10,000,000. No
category for $10.5 million existed. Thus, the number is as accurate
as it is possible to calculate with the available information.
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33. Additionally, the Small Business Administration defines a
radio broadcasting station that has $5 million or less in annual
receipts as a small business.108 A radio broadcasting
station is an establishment primarily engaged in broadcasting aural
programs by radio to the public.109 Included in this
industry are commercial, religious, educational, and other radio
stations.110 Radio broadcasting stations which primarily
are engaged in radio broadcasting and which produce radio program
materials are similarly included.111 However, radio
stations which are separate establishments and are primarily engaged
in producing radio program material are classified under another SIC
number.112 The 1992 Census indicates that 96 percent
(5,861 of 6,127) radio station establishments produced less than $5
million in revenue in 1992.113 Official Commission
records indicate that 11,334 individual radio stations were
operating in 1992.114 As of December 31, 1997, Commission
records indicate that 12,270 radio stations were operating, of which
7,465 were FM stations.115 Only commercial stations are
subject to regulatory fees.
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\108\ 13 CFR 121.201, SIC code 4832.
\109\ 1992 Census, Series UC92-S-1, at Appendix A-9.
\110\ Id.
\111\ Id.
\112\ Id.
\113\ The Census Bureau counts radio stations located at the
same facility as one establishment. Therefore, each co-located AM/FM
combination counts as one establishment.
\114\ FCC News Release, No. 31327 (Jan. 13, 1993).
\115\ FCC News Release, ``Broadcast Station Totals as of
December 31, 1997.''
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34. Thus, the rules may affect approximately 1,558 full power
television stations, approximately 1,200 of which are considered
small businesses.116 Additionally,
[[Page 35847]]
the proposed rules will affect some 12,156 full power radio
stations, approximately 11,670 of which are small
businesses.117 These estimates may overstate the number
of small entities because the revenue figures on which they are
based do not include or aggregate revenues from non-television or
non-radio affiliated companies. There are also 1,952 low power
television stations (LPTV).118 Given the nature of this
service, we will presume that all LPTV licensees qualify as small
entities under the SBA definition.
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\116\ We use the 77 percent figure of TV stations operating at
less than $10 million for 1992 and apply it to the 1997 total of
1558 TV stations to arrive at 1,200 stations categorized as small
businesses.
\117\ We use the 96% figure of radio station establishments with
less than $5 million revenue from the Census data and apply it to
the 12,088 individual station count to arrive at 11,605 individual
stations as small businesses.
\118\ FCC News Release, No. 7033 (Mar. 6, 1997).
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Alternative Classification of Small Stations
35. An alternative way to classify small radio and television
stations is by number of employees. The Commission currently applies
a standard based on the number of employees in administering its
Equal Employment Opportunity Rule (EEO) for
broadcasting.119 Thus, radio or television stations with
fewer than five full-time employees are exempted from certain EEO
reporting and record keeping requirements.120 We estimate
that the total number of broadcast stations with 4 or fewer
employees is approximately 4,239.121
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\119\ The Commission's definition of a small broadcast station
for purposes of applying its EEO rules was adopted prior to the
requirement of approval by the SBA pursuant to section 3(a) of the
Small Business Act, 15 U.S.C. 632(a), as amended by section 222 of
the Small Business Credit and Business Opportunity Enhancement Act
of 1992, Pub. L. 102-366, 222(b)(1), 106 Stat. 999 (1992), as
further amended by the Small Business Administration Reauthorization
and Amendments Act of 1994, Pub. L. 103-403, 301, 108 Stat. 4187
(1994). However, this definition was adopted after public notice and
the opportunity for comment. See Report and Order in Docket No.
18244, 23 FCC 2d 430 (1970), 35 FR 8925 (Jun. 6, 1970).
\120\ See, e.g., 47 CFR 73.3612 (Requirement to file annual
employment reports on Form 395 applies to licensees with five or
more full-time employees); First Report and 0rder in Docket No.21474
(Amendment of Broadcast Equal Employment Opportunity Rules and FCC
Form 395), 70 FCC 2d 1466 (1979), 50 FR 50329 (Dec. 10, 1985). The
Commission is currently considering how to decrease the
administrative burdens imposed by the EEO rule on small stations
while maintaining the effectiveness of our broadcast EEO
enforcement. Order and Notice of Proposed Rule Making in MM Docket
No. 96-16 (Streamlining Broadcast EEO Rule and Policies, Vacating
the EEO Forfeiture Policy Statement and Amending Section 1.80 of the
Commission's Rules to Include EEO Forfeiture Guidelines), 11 FCC Rcd
5154 (1996), 61 FR 9964 (Mar. 12, 1996). One option under
consideration is whether to define a small station for purposes of
affording such relief as one with ten or fewer full-time employees.
\121\ Compilation of 1994 Broadcast Station Annual Employment
Reports (FCC Form B), Equal Opportunity Employment Branch, Mass
Media Bureau, FCC.
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Auxiliary, Special Broadcast and Other Program Distribution Services
36. This service involves a variety of transmitters, generally
used to relay broadcast programming to the public (through
translator and booster stations) or within the program distribution
chain (from a remote news gathering unit back to the station). The
Commission has not developed a definition of small entities
applicable to broadcast auxiliary licensees. Therefore, the
applicable definitions of small entities are those, noted
previously, under the SBA rules applicable to radio broadcasting
stations and television broadcasting stations. 122
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\122\ 13 CFR 121.201, SIC code 4832.
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37. There are currently 2,720 FM translators and boosters, and
4,952 TV translators.123 The FCC does not collect
financial information on any broadcast facility, and the Department
of Commerce does not collect financial information on these
auxiliary broadcast facilities. We believe, however, that most, if
not all, of these auxiliary facilities could be classified as small
businesses by themselves. We also recognize that most translators
and boosters are owned by a parent station which, in some cases,
would be covered by the revenue definition of small business entity
discussed above. These stations would likely have annual revenues
that exceed the SBA maximum to be designated as a small business
(either $5 million for a radio station or $10.5 million for a TV
station). Furthermore, they do not meet the Small Business Act's
definition of a ``small business concern'' because they are not
independently owned and operated.124
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\123\ FCC News Release, Broadcast Station Totals as of December
31, 1996, No. 71831 (Jan. 21, 1997).
\124\ 15 U.S.C. 632.
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38. Multipoint Distribution Service (MDS). This service involves
a variety of transmitters, which are used to relay programming to
the home or office, similar to that provided by cable television
systems.125 In connection with the 1996 MDS auction, the
Commission defined small businesses as entities that had annual
average gross revenues for the three preceding years not in excess
of $40 million.126 This definition of a small entity in
the context of MDS auctions has been approved by the
SBA.127 These stations were licensed prior to
implementation of Section 309(j) of the Communications Act of 1934,
as amended.128 Licenses for new MDS facilities are now
awarded to auction winners in Basic Trading Areas (BTAs) and BTA-
like areas.129 The MDS auctions resulted in 67 successful
bidders obtaining licensing opportunities for 493 BTAs. Of the 67
auction winners, 61 meet the definition of a small business. There
are 1,573 previously authorized and proposed MDS stations currently
licensed. Thus, we conclude that there are 1,634 MDS providers that
are small businesses as deemed by the SBA and the Commission's
auction rules. It is estimated, however, that only 1,650 MDS
licensees are subject to regulatory fees, and the number which are
small businesses is unknown.
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\125\ For purposes of this item, MDS includes both the single
channel Multipoint Distribution Service (MDS) and the Multichannel
Multipoint Distribution Service (MMDS).
\126\ 47 CFR 1.2110 (a)(1).
\127\ Amendment of Parts 21 and 74 of the Commission's Rules
with Regard to Filing Procedures in the Multipoint Distribution
Service and in the Instructional Television Fixed Service and
Implementation of Section 309(j) of the Communications Act--
Competitive Bidding, 10 FCC Rcd 9589 (1995), 60 FR 36524 (Jul. 17,
1995).
\128\ 47 U.S.C. 309(j).
\129\ Id. A Basic Trading Area (BTA) is the geographic area by
which the Multipoint Distribution Service is licensed. See Rand
McNally 1992 Commercial Atlas and Marketing Guide, 123rd Edition,
pp. 36-39.
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Wireless and Commercial Mobile Services
39. Cellular Licensees. Neither the Commission nor the SBA has
developed a definition of small entities applicable to cellular
licensees. Therefore, the applicable definition of small entity is
the definition under the SBA rules applicable to radiotelephone
(wireless) companies. This provides that a small entity is a
radiotelephone company employing no more than 1,500
persons.130 According to the Bureau of the Census, only
twelve radiotelephone firms from a total of 1,178 such firms which
operated during 1992 had 1,000 or more employees.131
Therefore, even if all twelve of these firms were cellular telephone
companies, nearly all cellular carriers were small businesses under
the SBA's definition. In addition, we note that there are 1,758
cellular licenses; however, a cellular licensee may own several
licenses. In addition, according to the most recent
Telecommunications Industry Revenue data, 732 carriers reported that
they were engaged in the provision of either cellular service or
Personal Communications Service (PCS) services, which are placed
together in the data.132 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 cellular
service carriers that would qualify as small business concerns under
the SBA's definition. Consequently, we estimate that there are fewer
than 732 small cellular service carriers that may be affected by the
rules, herein adopted.
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\130\ 13 CFR 121.201, SIC code 4812.
\131\ 1992 Census, Series UC92-S-1, at Table 5, SIC code 4812.
\132\ Trends in Telephone Service, Table 19.3 (February 19,
1999).
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40. 220 MHz Radio Service--Phase I Licensees. The 220 MHz
service has both Phase I and Phase II licenses. Phase I licensing
was conducted by lotteries in 1992 and 1993. There are approximately
1,515 such non-nationwide licensees and four nationwide licensees
currently authorized to operate in the 220 MHz band. The Commission
has not developed a definition of small entities specifically
applicable to such incumbent 220 MHz Phase I licensees. To estimate
the number of such licensees that are small businesses, we apply the
definition under the SBA rules applicable to Radiotelephone
Communications companies. This definition provides that a small
entity
[[Page 35848]]
is a radiotelephone company employing no more than 1,500
persons.133 According to the Bureau of the Census, only
12 radiotelephone firms out of a total of 1,178 such firms which
operated during 1992 had 1,000 or more employees.134
Therefore, if this general ratio continues in 1999 in the context of
Phase I 220 MHz licensees, we estimate that nearly all such
licensees are small businesses under the SBA's definition.
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\133\ 13 CFR 121.201, Standard Industrial Classification (SIC)
code 4812.
\134\ U.S. Bureau of the Census, U.S. Department of Commerce,
1992 Census of Transportation, Communications, and Utilities, UC 92-
S-1, Subject Series, Establishment and Firm Size, Table 5,
Employment Size of Firms; 1992, SIC code 4812 (issued May 1995).
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41. 220 MHz Radio Service--Phase II Licensees. The Phase II 220
MHz service is a new service, and is subject to spectrum auctions.
In the 220 MHz Third Report and Order, we adopted criteria for
defining small businesses and very small businesses for purposes of
determining their eligibility for special provisions such as bidding
credits and installment payments.135 We have defined a
small business as an entity that, together with its affiliates and
controlling principals, has average gross revenues not exceeding $15
million for the preceding three years. Additionally, a very small
business is defined as an entity that, together with its affiliates
and controlling principals, has average gross revenues that are not
more than $3 million for the preceding three years.136
The SBA has approved these definitions.137 An auction of
Phase II licenses commenced on September 15, 1998, and closed on
October 22, 1998.138 Nine hundred and eight (908)
licenses were auctioned in 3 different-sized geographic areas: three
nationwide licenses, 30 Regional Economic Area Group Licenses, and
875 Economic Area (EA) Licenses. Of the 908 licenses auctioned, 693
were sold. Companies claiming small business status won: one of the
Nationwide licenses, 67% of the Regional licenses, and 54% of the EA
licenses. As of January 22, 1999, the Commission announced that it
was prepared to grant 654 of the Phase II licenses won at
auction.139 A re-auction of the remaining, unsold
licenses is likely to take place during calendar year 1999.
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\135\ 220 MHz Third Report and Order, 12 FCC Rcd 10943, 11068-
70, at paras. 291-295 (1997).
\136\ 220 MHz Third Report and Order, 12 FCC Rcd at 11068-69,
para. 291.
\137\ See Letter from A. Alvarez, Administrator, SBA, to D.
Phythyon, Chief, Wireless Telecommunications Bureau, FCC (Jan. 6,
1998).
\138\ See generally Public Notice, ``220 MHz Service Auction
Closes,'' Report No. WT 98-36 (Wireless Telecom. Bur. Oct. 23,
1998).
\139\ Public Notice, ``FCC Announces It is Prepared to Grant 654
Phase II 220 MHz Licenses After Final Payment is Made,'' Report No.
AUC-18-H, DA No. 99-229 (Wireless Telecom. Bur. Jan. 22, 1999).
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42. 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. 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.140 At
present, there are approximately 24,000 Private Paging licenses and
74,000 Common Carrier Paging licenses. According to the most recent
Telecommunications Industry Revenue data, 137 carriers reported that
they were engaged in the provision of either paging or ``other
mobile'' services, which are placed together in the
data.141 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 137 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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\140\ 13 CFR 121.201, SIC code 4812.
\141\ Trends in Telephone Service, Table 19.3 (February 19,
1999).
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43. Mobile Service Carriers. Neither the Commission nor the SBA
has developed a definition of small entities specifically applicable
to mobile service carriers, such as paging companies. As noted above
in the section concerning paging service carriers, the closest
applicable definition under the SBA rules is that for radiotelephone
(wireless) companies,142 and the most recent
Telecommunications Industry Revenue data shows that 23 carriers
reported that they were engaged in the provision of SMR dispatching
and ``other mobile'' services.143 Consequently, we
estimate that there are fewer than 23 small mobile service carriers
that may be affected by the rules, herein adopted.
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\142\ 13 CFR 121.201, SIC code 4812.
\143\ Trends in Telephone Service, Table 19.3 (February 19,
1999).
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44. Broadband Personal Communications Service (PCS). 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.144 For
Block F, an additional classification for ``very small business''
was added and is defined as an entity that, together with their
affiliates, has average gross revenues of not more than $15 million
for the preceding three calendar years.145 These
regulations defining ``small entity'' in the context of broadband
PCS auctions have been approved by the SBA.146 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.147 Based on this
information, we conclude that the number of small broadband PCS
licensees 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 entity PCS providers as defined by the SBA and the
Commission's auction rules.
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\144\ See Amendment of Parts 20 and 24 of the Commission's
Rules--Broadband PCS Competitive Bidding and the Commercial Mobile
Radio Service Spectrum Cap, Report and Order, FCC 96-278, WT Docket
No. 96-59, paras. 57-60 (released Jun. 24, 1996), 61 FR 33859 (Jul.
1, 1996); see also 47 CFR 24.720(b).
\145\ See Amendment of Parts 20 and 24 of the Commission's
Rules--Broadband PCS Competitive Bidding and the Commercial Mobile
Radio Service Spectrum Cap, Report and Order, FCC 96-278, WT Docket
No. 96-59, para. 60 (1996), 61 FR 33859 (Jul. 1, 1996).
\146\ See, e.g., 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).
\147\ FCC News, Broadband PCS, D, E and F Block Auction Closes,
No. 71744 (released Jan. 14, 1997).
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45. 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.
46. Rural Radiotelephone Service. The Commission has not adopted
a definition of small entity specific to the Rural Radiotelephone
Service.148 A significant subset of the Rural
Radiotelephone Service is the Basic Exchange Telephone Radio Systems
(BETRS).149 We will use the SBA's definition applicable
to radiotelephone companies, i.e., an entity employing no more than
1,500 persons.150 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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\148\ The service is defined in 47 CFR 22.99.
\149\ BETRS is defined in 47 CFR 22.757 and 22.759.
\150\ 13 CFR 121.201, SIC code 4812.
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47. Air-Ground Radiotelephone Service. The Commission has not
adopted a definition of small entity specific to the Air-Ground
Radiotelephone Service.151 Accordingly, we
[[Page 35849]]
will use the SBA's definition applicable to radiotelephone
companies, i.e., an entity employing no more than 1,500
persons.152 There are approximately 100 licensees in the
Air-Ground Radiotelephone Service, and we estimate that almost all
of them qualify as small under the SBA definition.
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\151\ The service is defined in 47 CFR 22.99.
\152\ 13 CFR 121.201, SIC code 4812.
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48. Specialized Mobile Radio (SMR). The Commission awards
bidding credits in auctions for geographic area 800 MHz and 900 MHz
SMR licenses to firms that had revenues of no more than $15 million
in each of the three previous calendar years.153 In the
context of 900 MHz SMR, this regulation defining ``small entity''
has been approved by the SBA; approval concerning 800 MHz SMR is
being sought.
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\153\ 47 CFR 90.814(b)(1).
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49. The proposed fees in the NPRM 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 no more than $15
million. One firm has over $15 million in revenues. We assume, for
purposes of this IRFA, that all of the remaining existing extended
implementation authorizations are held by small entities, as that
term is defined by the SBA.
50. For geographic area licenses in the 900 MHz SMR band, there
are 60 who qualified as small entities. For the 800 MHz SMR's, 38
are small or very small entities.
51. Private Land Mobile Radio (PLMR). PLMR systems serve an
essential role in a range of industrial, business, land
transportation, and public safety activities. These radios are used
by companies of all sizes operating in all U.S. business categories.
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.
52. The Commission is unable at this time to estimate the number
of small businesses which could be impacted by the rules. However,
the Commission's 1994 Annual Report on PLMRs 154
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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\154\ Federal Communications Commission, 60th Annual Report,
Fiscal Year 1994, at 116.
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53. Amateur Radio Service. We estimate that 6,800 applicants
will apply for vanity call signs in FY 1999. All are presumed to be
individuals. All other amateur licensees are exempt from payment of
regulatory fees.
54. Aviation and Marine Radio Service. Small businesses in the
aviation and marine radio services use a marine very high frequency
(VHF) radio, any type of emergency position indicating radio beacon
(EPIRB) and/or radar, a VHF aircraft radio, and/or any type of
emergency locator transmitter (ELT). The Commission has not
developed a definition of small entities specifically applicable to
these small businesses. Therefore, the applicable definition of
small entity is the definition under the SBA rules for
radiotelephone communications.155
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\155\ 13 CFR 121.201, SIC code 4812.
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55. Most applicants for recreational licenses are individuals.
Approximately 581,000 ship station licensees and 131,000 aircraft
station licensees operate domestically and are not subject to the
radio carriage requirements of any statute or treaty. Therefore, for
purposes of our evaluations and conclusions in this IRFA, we
estimate that there may be at least 712,000 potential licensees
which are individuals or are small entities, as that term is defined
by the SBA. We estimate, however, that only 11,600 will be subject
to FY 1999 regulatory fees.
56. Fixed Microwave Services. Microwave services include common
carrier,156 private-operational fixed,157 and
broadcast auxiliary radio services.158 At present, there
are approximately 22,015 common carrier fixed licensees and 61,670
private operational-fixed licensees and broadcast auxiliary radio
licensees in the microwave services. The Commission has not 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.159 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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\156\ 47 CFR 101 et seq. (formerly, part 21 of the Commission's
Rules).
\157\ 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.
\158\ 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.
\159\ 13 CFR 121.201, SIC 4812.
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57. Public Safety Radio Services. Public Safety radio services
include police, fire, local government, forestry conservation,
highway maintenance, and emergency medical services.160
There are a total of approximately 127,540 licensees within these
services. Governmental entities as well as private businesses
comprise the licensees for these services. As indicated supra in
paragraph four of this IRFA, all governmental entities with
populations of less than 50,000 fall within the definition of a
small entity.161 All licensees in this category are
exempt from the payment of regulatory fees.
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\160\ With the exception of the special emergency service, these
services are governed by Subpart B of part 90 of the Commission's
Rules, 47 CFR 90.15-90.27. The police service includes 26,608
licensees that serve state, county, and municipal enforcement
through telephony (voice), telegraphy (code) and teletype and
facsimile (printed material). The fire radio service includes 22,677
licensees comprised of private volunteer or professional fire
companies as well as units under governmental control. The local
government service that is presently comprised of 40,512 licensees
that are state, county, or municipal entities that use the radio for
official purposes not covered by other public safety services. There
are 7,325 licensees within the forestry service which is comprised
of licensees from state departments of conservation and private
forest organizations who set up communications networks among fire
lookout towers and ground crews. The 9,480 state and local
governments are licensed to highway maintenance service provide
emergency and routine communications to aid other public safety
services to keep main roads safe for vehicular traffic. The 1,460
licensees in the Emergency Medical Radio Service (EMRS) use the 39
channels allocated to this service for emergency medical service
communications related to the delivery of emergency medical
treatment. 47 CFR 90.15-90.27. The 19,478 licensees in the special
emergency service include medical services, rescue organizations,
veterinarians, handicapped persons, disaster relief organizations,
school buses, beach patrols, establishments in isolated areas,
communications standby facilities, and emergency repair of public
communications facilities. 47 CFR 90.33-90.55.
\161\ 5 U.S.C. 601(5).
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58. Personal Radio Services. Personal radio services provide
short-range, low power radio for personal communications, radio
signalling, and business communications not provided for in other
services. The services include the citizen's band (CB) radio
service, general mobile radio service (GMRS), radio control radio
service, and family radio service (FRS).162 Inasmuch as
the CB, GMRS, and FRS licensees are individuals, no small business
definition applies for these services. We are unable at this time to
estimate the number of other licensees that would qualify as small
under the SBA's definition; however, only GMRS licensees are subject
to regulatory fees.
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\162\ Licensees in the Citizens Band (CB) Radio Service, General
Mobile Radio Service (GMRS), Radio Control (R/C) Radio Service and
Family Radio Service (FRS) are governed by Subpart D, Subpart A,
Subpart C, and Subpart B, respectively, of part 95 of the
Commission's Rules. 47 CFR 95.401-95.428; 95.1-95.181; 95.201-
95.225; 47 CFR 95.191-95.194.
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59. 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.163 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 under the SBA's
definition for radiotelephone communications.
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\163\ 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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[[Page 35850]]
60. 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 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 Projected Reporting, Recordkeeping and Other
Compliance Requirements
61. With certain exceptions, the Commission's Schedule of
Regulatory Fees applies to all Commission licensees and regulatees.
Most licensees will be required to count the number of licenses or
call signs authorized, complete and submit an FCC Form 159 (``FCC
Remittance Advice''), and pay a regulatory fee based on the number
of licenses or call signs.164 Interstate telephone
service providers must compute their annual regulatory fee based on
their adjusted gross interstate revenue using information they
already supply to the Commission in compliance with the
Telecommunications Relay Service (TRS) Fund, and they must complete
and submit the FCC Form 159. Compliance with the fee schedule will
require some licensees to tabulate the number of units (e.g.,
cellular telephones, pagers, cable TV subscribers) they have in
service, and complete and submit an FCC Form 159. Licensees
ordinarily will keep a list of the number of units they have in
service as part of their normal business practices. No additional
outside professional skills are required to complete the FCC Form
159, and it can be completed by the employees responsible for an
entity's business records.
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\164\ The following categories are exempt from the Commission's
Schedule of Regulatory Fees: Amateur radio licensees (except
applicants for vanity call signs) and operators in other non-
licensed services (e.g., Personal Radio, part 15, ship and
aircraft). Governments and non-profit (exempt under section 501(c)
of the Internal Revenue Code) entities are exempt from payment of
regulatory fees and need not submit payment. Non-commercial
educational broadcast licensees are exempt from regulatory fees as
are licensees of auxiliary broadcast services such as low power
auxiliary stations, television auxiliary service stations, remote
pickup stations and aural broadcast auxiliary stations where such
licenses are used in conjunction with commonly owned non-commercial
educational stations. Emergency Alert System licenses for auxiliary
service facilities are also exempt as are instructional television
fixed service licensees. Regulatory fees are automatically waived
for the licensee of any translator station that: (1) is not licensed
to, in whole or in part, and does not have common ownership with,
the licensee of a commercial broadcast station; (2) does not derive
income from advertising; and (3) is dependent on subscriptions or
contributions from members of the community served for support.
Receive only earth station permittees are exempt from payment of
regulatory fees. A regulatee will be relieved of its fee payment
requirement if its total fee due, including all categories of fees
for which payment is due by the entity, amounts to less than $10.
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62. Each licensee must submit the FCC Form 159 to the
Commission's lockbox bank after computing the number of units
subject to the fee. As an option, licensees are permitted to file
electronically or on computer diskette to minimize the burden of
submitting multiple copies of the FCC Form 159. This latter,
optional procedure may require additional technical skills.
Applicants who pay small fees in advance supply fee information as
part of their application or by attaching FCC Form 159, where
applicable.
63. Licensees and regulatees are advised that failure to submit
the required regulatory fee in a timely manner will subject the
licensee or regulatee to a late payment fee of 25 percent in
addition to the required fee.165 Until payment is
received, no new or pending applications will be processed, and
existing authorizations may be subject to rescission.166
Further, in accordance with the Debt Collection Improvement Act of
1996, federal agencies may bar a person or entity from obtaining a
federal loan or loan insurance guarantee if that person or entity
fails to pay a delinquent debt owed to any federal
agency.167 Thus, debts owed to the Commission may result
in a person or entity being denied a federal loan or loan guarantee
pending before another federal agency until such obligations are
paid.168
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\165\ 47 U.S.C. 1.1164(a).
\166\ 47 U.S.C. 1.1164(c).
\167\ Pub. L. 104-134, 110 Stat. 1321 (1996).
\168\ 31 U.S.C. 7701(c)(2)(B).
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64. The Commission's rules currently provide for relief in
exceptional circumstances. Persons or entities that believe they
have been placed in the wrong regulatory fee category or are
experiencing extraordinary and compelling financial hardship, upon a
showing that such circumstances override the public interest in
reimbursing the Commission for its regulatory costs, may request a
waiver, reduction or deferment of payment of the regulatory
fee.169 However, timely submission of the required
regulatory fee must accompany requests for waivers or reductions.
This will avoid any late payment penalty if the request is denied.
The fee will be refunded if the request is granted. In exceptional
and compelling instances (where payment of the regulatory fee along
with the waiver or reduction request could result in reduction of
service to a community or other financial hardship to the licensee),
the Commission will accept a petition to defer payment along with a
waiver or reduction request.
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\169\ 47 U.S.C. 1.1166.
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V. Steps Taken To Minimize Significant Economic Impact on Small
Entities, and Significant Alternatives Considered
65. The Omnibus Consolidated and Emergency Supplemental
Appropriations Act for FY 1999, Public Law 105-277 requires the
Commission to revise its Schedule of Regulatory Fees in order to
recover the amount of regulatory fees that Congress, pursuant to
Section 9(a) of the Communications Act, as amended, has required the
Commission to collect for Fiscal Year (FY) 1999.170 We
have sought comment on the proposed methodology for implementing
these statutory requirements and any other potential impact of these
proposals on small business entities.
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\170\ 47 U.S.C. 159(a).
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66. With the use of actual cost accounting data for computation
of regulatory fees, we found that some fees which were very small in
previous years would have increased dramatically. The methodology we
are adopting in this Report and Order minimizes this impact by
limiting the amount of increase and shifting costs to other services
which, for the most part, are larger entities.
67. Several categories of licensees and regulatees are exempt
from payment of regulatory fees. See, e.g., footnote 164, supra, and
Attachment F of the Report and Order, infra.
Report to Small Business Administration: The Commission will
send a copy of this Report and Order, including a copy of the Final
Regulatory Flexibility Analysis (FRFA), to the Chief Counsel for
Advocacy of the Small Business Administration.
Report to Congress: The Commission shall include a copy of this
Final Regulatory Flexibility Analysis, along with the Report and
Order, in a report to Congress pursuant to the Small Business
Regulatory Enforcement F
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