[Federal Register Volume 63, Number 243 (Friday, December 18, 1998)]
[Proposed Rules]
[Pages 70090-70093]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-33564]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Part 1
[MD Docket No. 98-200; FCC 98-298]
Assessment and Collection of Regulatory Fees For Fiscal Year 1999
AGENCY: Federal Communications Commission.
ACTION: Notice of inquiry.
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SUMMARY: The Commission is seeking proposals to assist it in revising
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.
DATES: Comments are due January 7, 1999 and Reply Comments are due
January 19, 1999.
FOR FURTHER INFORMATION CONTACT: Terry Johnson, Office of Managing
Director at (202) 418-0445, or the Fees Hotline at (202) 418-0192.
SUPPLEMENTARY INFORMATION:
Adopted: November 10, 1998.
Released: December 4, 1998.
Table of Contents
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Paragraph
Topic No.
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I. Introduction............................................ 1
II. Background............................................. 2
III. Discussion............................................ 4
a. Commercial Mobile Radio Services (``CMRS'')........... 5
b. Space Stations
i. Geostationary Orbit Space Stations (``GSOs'')....... 10
ii. Non-geostationary Orbit Space Stations (``NGSOs''). 11
c. Interstate Telephone Service Providers................ 12
d. Treatment of New Services in all Feeable Categories... 16
IV. Procedural Matters
a. Comment Period and Procedures......................... 19
b. Ex Parte Rules........................................ 24
c. Authority and Further Information..................... 25
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I. Introduction
1. By this Notice of Inquiry (``NOI''), the Commission begins a
rulemaking proceeding seeking comments and suggestions for revising its
Schedule of Regulatory Fees in order to recover the amount of
regulatory fees that Congress requires it to collect for Fiscal Year
(``FY'') 1999.1
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\1\ 47 U.S.C. 159(a).
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II. Background
2. 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.2 In our FY
1994 Report and Order,3 we adopted the Schedule of
Regulatory Fees that Congress established and we prescribed rules to
govern payment of the fees, as required by Congress.4
Subsequently, in our FY 1995, FY 1996, FY 1997 and FY 1998 fee
Orders,5 we modified the Schedule to increase by
approximately 93 percent, 9 percent, 21 percent, and 7 percent,
respectively, the revenue generated by these fees in accordance with
the amounts Congress required us to collect for FY 1995, FY 1996, FY
1997 and FY 1998. Also, in our FY 1995, FY 1996, FY 1997 and FY 1998
fee Orders, we amended certain rules governing our regulatory fee
program based upon our experience administering the program in prior
years.6
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\2\ Id.
\3\ 59 FR 30984 (Jun. 16, 1994).
\4\ 47 U.S.C. 159(b), (f)(1).
\5\ 60 FR 34004 (Jun. 29, 1995), 61 FR 36629 (Jul. 12, 1996), 62
FR 37408 (Jul. 11, 1997), and 63 FR 35847 (Jul. 1, 1998),
respectively.
\6\ 47 CFR 1.1151 et seq.
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3. 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.'' 7
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\7\ 47 U.S.C. 159(b)(3).
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III. Discussion
4. Pursuant to its FY 1998 Notice of Proposed Rulemaking
(``NPRM''),8 the Commission received comments from
interested parties concerning its proposed ``permitted amendments'' to
the fee schedule. However, the Commission rejected some and was unable
to resolve several other of the commenters' proposals in time for
inclusion in its FY 1998 Report and Order,9 due to the
statutory 90-day advance notice required by Congress.10
Further, in its FY 1998 Report and Order, the Commission stated its
intention to issue this NOI requesting that interested parties comment
on possible solutions to these unresolved issues.11 Briefly,
the issues for which we seek comment include: (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; (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-
[[Page 70091]]
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 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.
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\8\ 63 FR 16188, (Apr. 2, 1998).
\9\ 63 FR 35847, (Jul. 1, 1998).
\10\ 47 U.S.C. 159(b)(4)(B).
\11\ See FY 1998 Report and Order at paragraaphs 48, 53, 55, and
67.
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a. Commercial Mobile Radio Services (``CMRS'')
5. For FY 1998, CMRS licensees authorized for operation on
broadband spectrum 12 are subject to payment of the CMRS
Mobile Services fee 13 and licensees authorized for
operation on narrowband spectrum 14 are subject to payment
of the CMRS Messaging Services fee.15 Our fee schedule
considers the nature of the services offered only to the extent that
services offered on broadband spectrum and services offered on
narrowband spectrum are subject to different categories of fee payment.
In our FY 1998 NPRM, we invited interested parties to comment on our
proposal to continue this fee structure for CMRS services.
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\12\ Includes specialized mobile radio services (part 90),
personal communications services (part 24), wireless communications
services (part 27), public coast stations (part 80), and public
mobile radio stations (cellular radio, 800 MHz air-ground
radiotelephone, and offshore radio services (part 22)). See FY 1998
Report and Order at Attachment H, paragraph 14.
\13\ For FY 1998, this fee is $0.29 per feeable unit. See FY
1998 Report and Order at Attachment F.
\14\ Includes licensees formerly licensed as part of the
private radio services (private paging, qualifying interconnected
business radio services, and 220-222 MHz land mobile systems (part
90)), and licensees formerly licensed as part of the common carrier
radio services (public mobile one-way paging (part 22)) and
licensees of personal communications services (one-way and two-way
paging (part 24)). See FY 1998 Report and Order at Attachment H,
paragraph 15.
\15\ For FY 1998, this fee is $0.04 per feeable unit. See FY
1998 Report and Order at Attachment F.
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6. Several parties filed comments, in particular, concerning the
demarcation between the CMRS Mobile Services and CMRS Messaging
Services fee categories. SBC Communications Inc. (``SBC'') urged us to
adopt only a single CMRS fee covering all CMRS services, contending
that both Congress and the Commission intended to create regulatory
symmetry among the CMRS services, and, thereby avoid any competitive
advantage to narrowband personal communication service (``PCS'') and
specialized mobile radio (``SMR'') service over cellular and broadband
PCS.16 In contrast, Paging Network, Inc. (``Pagenet'')
supported retention of the existing fee category structure, but
recommended adoption of a subcategory for non-voice networks and
services within the CMRS Mobile Services fee category which would be
subject to the same fee payment as licensees within the CMRS Messaging
Services fee category.17 Pagenet argued that there are
significant differences in network efficiency and the level of
Commission regulation required between voice and non-voice operations
such that non-voice services are being charged a disproportionate share
of the CMRS Mobile Services costs.
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\16\ See Comments of SBC Communications, Inc. at p. 7.
\17\ See Comments of Paging Network, Inc. at p. 2.
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7. BellSouth Wireless Data (``BellSouth WD'') suggested that 900
MHz SMR licensees should be classified in the CMRS Messaging Services
fee category, and not in the CMRS Mobile Services fee category in which
900 MHz SMR licensees are currently classified.18 BellSouth
WD argued that regulatory fees should be governed by how the service
bands are predominantly used on a licensee by licensee basis. BellSouth
WD stated that the Commission has allocated 5 MHz of spectrum in each
geographic region for 900 MHz SMR systems and that, in practice, this
spectrum is licensed in 20 blocks, each consisting of 10 two-way 12.5
kHz paths, or 0.25 MHz per 10-channel block. Further, BellSouth WD
contended that 900 MHz SMR systems do not have the capacity to compete
with true broadband systems, lacking the amount of spectrum of those
services included in the CMRS Mobile Services fee category. Thus,
BellSouth WD suggested that either we include any authorization
providing 25 kHz or less spectrum in the CMRS Messaging Services fee
category, or we establish a third CMRS fee payment category for systems
that operate in the 900 MHz SMR band and other CMRS services that are
allocated no more than 5 MHz of spectrum. American Mobile
Telecommunications Association (``AMTA'') supported BellSouth WD's
proposal.19
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\18\ See Comments of BellSouth Wireless Data, L.P. at p. 2.
\19\ See Reply Comments of American Mobile Telecommunications
Association, Inc. at pp. 2-4.
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8. Small Business in Telecommunications (``SBT'') argued that,
because we classify narrowband PCS, which operates on 50 kHz paired
channels, in the CMRS Messaging Services fee category,20 we
should clarify that all CMRS stations which are authorized with channel
bandwidth not exceeding 50 kHz are within the CMRS Messaging Services
fee category. Moreover, SBT contended we should clarify that SMR
systems and public coast stations are within the CMRS Messaging
Services fee category since these stations are authorized with
substantially less channel capacity than narrowband PCS
stations.21
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\20\ See FY 1998 Report and Order at Attachment H, paragraph 15.
\21\ See Comments of Small Business in Telecommunications at pp.
5-6.
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9. We must be able to determine, or estimate with some degree of
precision, the number of feeable units that are within each fee payment
category and be able to determine the pro rata share of our regulatory
costs that must be assessed per feeable unit. We are not aware of any
existing records or other sources of information that would permit
development of any of the proposals offered by the commenters as
summarized above. Therefore, we seek comments on these and solicit any
other proposals to revise the methodology the Commission uses to
determine its CMRS fee categories. Further, we ask that all comments on
the above and any new proposals include data (or available sources for
data) that would enable the Commission to definitively assign each type
of service to the appropriate proposed fee category and provide an
estimate of the number of feeable units contained in each category for
FY 1999.
b. Space Stations
i. Geostationary Orbit Space Stations (``GSOs'')
10. In the past, we have adopted the statutory fee schedule's ``per
satellite'' method for assessment of fees upon licensees of
geostationary (GSOs) space stations, 47 U.S.C. 159(g). The calculation
of annual regulatory fees for GSOs has however been a matter of dispute
for several years during which proposals for alternate methods of
calculation have been presented. Therefore, we are seeking alternative
methods of calculating fees based on different criteria and/or
information from affected parties. We ask commentors to suggest
alternative methods for assessing regulatory fees for GSO space
stations. Along with suggestions, we ask commentors 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.
[[Page 70092]]
ii. Non-geostationary Orbit Space Stations (``NGSOs'')
11. In our FY 1998 Report and Order, we continued to require that
NGSO licensees pay for NGSO systems by requiring a fee payment ``upon
the commencement of operation of a system's first satellite as reported
annually pursuant to sections 25.142(c), 25.143(e), 25.145(g) or upon
certification of operation of a single satellite pursuant to section
25.121(d).'' In our FY 1998 proceeding, Orbital Communications
Corporation (``ORBCOMM'') contended that, because all NGSO licensees
benefit from our policy, enforcement and information activities and
services, the Commission should recover its NGSO space station
regulatory costs from all NGSO licensees, rather than from only those
that have launched their initial satellite.22 As we stated
in our FY 1998 Report and Order, we are including ORBCOMM's proposal in
this NOI and seek comment here on ORBCOMM's proposal, as well as
alternative proposals.
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\22\ See Comments of Orbital Communications Corporation at p. 3.
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c. Interstate Telephone Service Providers
12. For FY 1998 we adopted the methodology for assessing fees upon
interstate telephone service providers that we had employed in past
years. Under this methodology, interstate telephone service providers
calculate their regulatory fees based upon their proportionate share of
interstate revenues using the methodology we developed for contribution
to the TRS Fund.23 However, in order to avoid imposing a
double fee payment upon certain interstate telephone service providers
(e.g, resellers), we permit those interstate telephone service
providers to remove, from their gross interstate revenue, payments made
to underlying carriers for telecommunications facilities and services,
including payments for interstate access services.
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\23\ See Telecommunications Relay Services, 8 FCC Rcd 5300
(1993).
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13. In our FY 1998 proceeding, SBC contended that our methodology
imposes an undue burden upon the local exchange carriers (``LECs'')
because we permit interexchange carriers (``IXCs'') to deduct payments
made to underlying common carriers from their gross interstate revenues
while LECs do not have such payments to deduct. SBC suggested that use
of end user revenues--the same contribution base used for the Universal
Service Fund--to calculate the annual fees would alleviate that burden
and be more competitively neutral.24
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\24\ See Report and Order In the Matter of Universal Service, 62
FR 32861 (Jun. 17, 1997).
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14. In our FY 1998 proceeding, we declined to adopt SBC's proposal.
We disagreed with SBC's description that end user revenues are more
competitively neutral than our current methodology. Specifically,
assuming that all fees are recovered from customers, including
customers of interstate telephone service providers that purchase their
service for resale, retail customers would still pay the same rates. To
the extent that services are provided in competition with other
interstate telephone service providers, those interstate telephone
service providers would pay the same percentage amounts when providing
the same services to the same customers. Additionally, in the FY 1998
proceeding, we said we do not have adequate data to estimate total
common carrier interstate end user revenue.25
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\25\ See FY 1998 Report and Order at paragraph 67.
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15. As we indicated in our FY 1998 Report and Order, we are
revisiting SBC's proposal here. Thus, we ask the common carrier
industry to comment on the feasibility of relying on end user revenues
as provided to the Universal Services Fund, as opposed to net revenues
based upon the TRS Fund. Further, we ask that commenters specify the
data upon which we can base this or any other alternative approach and
the most feasible method for obtaining this information.
d. Treatment of New Services in All Feeable Categories
16. In our FY 1998 proceeding, a number of payors of GSO fees
argued that licensees in existing GSO satellite services unfairly bear
the cost of our policy and rulemaking activities related to the
development of rules and procedures for ``new'' GSO satellite services.
They suggested that we create a separate regulatory category in our
regulatory cost accounting system for ``new services'' where the
Commission has not yet authorized a licensee. Regulatory costs
associated with the development of policy and rules for such new
services throughout the Commission would be charged to this cost
category and distributed across all fee payors when calculating
regulatory fee rates for any given fiscal year. Regulatory costs
associated with these new services would be charged to the appropriate
service, as they are now, upon the grant of the first authorization or
license for that service.
17. In our FY 1998 Report and Order, we concluded that due to a
tight collection schedule, as a practical matter, we had no viable
alternative other than adoption of the fees as proposed in the NPRM,
without any of the amendments proposed by commenters. However, as
indicated in our FY 1998 Report and Order, we seek comment on this and
other alternative approaches to our current regulatory fee cost
recovery methodology for new and developmental services. Specifically,
we seek comment on whether a regulatory category for ``new services,''
which would impact payors in all services, should be added to our cost
accounting system.
18. In addition, in our FY 1998 proceeding, some parties suggested
that the Commission identify more clearly costs related to those
activities intended to be covered by regulatory fees. We seek comment
on whether and how we should further distinguish our costs, in
particular those costs related to regulatory activities and ongoing
regulation of licensees. Further, we seek suggestions as to how we can
ensure that the amounts collected are distributed properly among our
fee categories.
IV. Procedural Matters
a. Comment Period and Procedures
19. Pursuant to sections 1.415 and 1.419 of the Commission's rules,
47 CFR 1.415, 1.419, interested parties may file comments on or before
January 7, 1999, and reply comments on or before July 19, 1999.
Comments may be filed using the Commission's Electronic Comment Filing
System (ECFS) or by filing paper copies. See Electronic Filing of
Documents in Rulemaking Proceedings, 63 FR 24121 (1998).
20. Comments filed through the ECFS can be sent as an electronic
file via the Internet to http://www.fcc.gov/e-file/ecfs.html>.
Generally, only one copy of an electronic submission must be filed. If
multiple docket or rulemaking numbers appear in the caption of this
proceeding, however, commenters must transmit one electronic copy of
the comments to each docket or rulemaking number referenced in the
caption. In completing the transmittal screen, commenters should
include their full name, Postal Service mailing address, and the
applicable docket or rulemaking number. Parties may also submit an
electronic comment by Internet e-mail. To get filing instructions for
e-mail comments, commenters should send an e-mail to ecfs@fcc.gov, and
should include the following words in the body of the message, ``get
form 26
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\26\ 47 CFR 1.204(b)(1).
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c. Authority and Further Information
25. Authority for this proceeding is contained in sections 4(i) and
(j), 9, and 303(r) of the Communications Act of 1934, as amended, 47
U.S.C. 154(i)--(j), 159, and 303(r). It is ordered that this NOI is
adopted.
26. Further information about this proceeding may be obtained by
contacting the Fees Hotline at (202) 418-0192, or you may e-mail your
questions to mcontee@fcc.gov.
Federal Communications Commission.
Magalie Roman Salas,
Secretary.
[FR Doc. 98-33564 Filed 12-17-98; 8:45 am]
BILLING CODE 6712-01-P
