[Federal Register Volume 63, Number 63 (Thursday, April 2, 1998)]
[Proposed Rules]
[Pages 16188-16215]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-8459]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Part 1
[MD Docket No. 98-36; FCC 98-40]
Assessment and Collection of Regulatory Fees For Fiscal Year 1998
AGENCY: Federal Communications Commission.
ACTION: Proposed rule.
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SUMMARY: The Commission is proposing to revise its Schedule of
Regulatory Fees in order to recover the amount of regulatory fees that
Congress has required it to collect for fiscal year 1998. Section 9 of
the Communications Act of 1934, as amended, provides for the annual
assessment and collection of regulatory fees. For fiscal year 1998
[[Page 16189]]
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 April 22, 1998 and Reply Comments are due May
4, 1998.
FOR FURTHER INFORMATION CONTACT: Terry Johnson, Office of Managing
Director at (202) 418-0445.
SUPPLEMENTARY INFORMATION:
Adopted: March 13, 1998
Released: March 25, 1998.
Table of Contents
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Paragraph
Topic numbers
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I. Introduction........................................... 1-3
II. Background............................................ 4-7
III. Discussion........................................... 8-42
A. Summary of FY 1998 Fee Methodology................. 8-12
B. Development of FY 1998 Fees........................ 13-29
i. Adjustment of Payment Units.................... 13
ii. Calculation of Revenue Requirements........... 14
iii. Calculation of Regulatory Costs.............. 15-16
iv. Establishment of 25% Revenue Ceilings......... 17-18
v. Recalculation of Fees.......................... 19
vi. Proposed Changes to Fee Schedule.............. 20-28
a. Commercial AM/FM Radio..................... 21-25
b. Alternative Proposed Schedule for AM and FM
Radio Stations............................... 26
vii. Effect of Revenue Redistributions on Major
Constituencies................................... 27
C. Other Issues....................................... 28-33
i. Distinguishing between CMRS Fee Categories..... 28-31
ii. Clarification of Operational LEO System....... 32
iii. Renaming of LEO Fee Category................. 33
D. Procedures for Payment of Regulatory Fees.......... 34-40
i. Annual Payments of Standard Fees............... 35
ii. Installment Payments for Large Fees........... 36
iii. Advance Payments of Small Fees............... 37
iv. Minimum Fee Payment Liability................. 38
v. Standard Fee Calculations and Payments......... 39-40
E. Schedule of FY 1998 Regulatory Fees................ 41
IV. Procedural Matters.................................... 42-46
A. Comment Period and Procedures...................... 42
B. Ex Parte Rules..................................... 43
C. Initial Regulatory Flexibility Analysis............ 44
D. Authority and Further Information.................. 45-46
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Attachment A--Initial Regulatory Flexibility Analysis
Attachment B--Sources of Payment Unit Estimates
Attachment C--Calculation of Revenue Requirements
Attachment D--Calculation of Regulatory Costs
Attachment E--Calculation of FY 1997 Regulatory Fees
Attachment F--Schedule of Regulatory Fees
Attachment G--Comparison Between FY 1997 and FY 1998 Fees
Attachment H--Detailed Guidance on Who Must Pay Regulatory Fees
Attachment I--Description of FCC Activities
Attachment J--Factors, measurements and calculations that go into
determining station signal contours and associated population
coverages
I. Introduction
1. By this Notice of Proposed Rulemaking, the Commission commences
a proceeding to revise its Schedule of Regulatory Fees in order to
collect the amount of regulatory fees that Congress, pursuant to
section 9(a) of the Communications Act, as amended, has required it to
collect for Fiscal Year (FY) 1998. See 47 U.S.C. 159 (a).
2. Congress has required that we collect $162,523,000 through
regulatory fees in order to recover the costs of our enforcement,
policy and rulemaking, international and user information activities
for FY 1998. See Public Law 105-119 and 47 U.S.C. 159(a)(2). This
amount is $10,000,000 or nearly 7% more than the amount that Congress
designated for recovery through regulatory fees for FY 1997. See
Assessment and Collection of Regulatory Fees for Fiscal Year 1997, FCC
97-215, released June 26, 1997, 62 FR 37408 (July 11, 1997). Thus, we
are proposing to revise our fees in order to collect the increased
amount that Congress has required that we collect. Additionally, we
propose to amend the Schedule in order to simplify and streamline the
Fee Schedule. See 47 U.S.C. 159(b)(3).
3. In proposing to revise 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 proposing changes
to the fees pursuant to public interest considerations. The current
Schedule of Regulatory Fees is set forth in sections 1.1152 through
1.1156 of the Commission's rules. See 47 CFR 1.1152 through 1.1156.
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. See 47 U.S.C. 159(a).
See Attachment I for a description of these activities. In our FY 1994
Fee Report and Order, 59 FR 30984 (June 16, 1994), we adopted the
Schedule of Regulatory Fees that Congress established, and we
prescribed rules to govern payment of the fees, as required by
Congress. See 47 U.S.C. 159(b), (f)(1). Subsequently, in
[[Page 16190]]
our FY 1995, FY 1996, and FY 1997 Fee Reports and Orders, 60 FR 34004
(June 29, 1995), 61 FR 36629 (July 12, 1996), and 62 FR 37408 (July 11,
1997), we modified the Schedule to increase by approximately 93
percent, 9 percent and 21 percent, respectively, the revenue generated
by these fees in accordance with the amounts Congress required us to
collect in FY 1995, FY 1996 and FY 1997. Also, in our FY 1995, FY 1996,
and FY 1997 Fee Reports and Orders, we amended certain rules governing
our regulatory fee program based upon our experience administering the
program in prior years. See 47 CFR Secs. 1.1151 et seq.
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. See 47 U.S.C. 159(b)(2), (b)(3).
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. See 47 U.S.C.
159(b)(2).
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.'' See 47 U.S.C. 159(b)(3).
7. Section 9(i) requires that we develop accounting systems
necessary to adjust our fees pursuant to changes in the costs of
regulation of the various services subject to a fee and for other
purposes. See 47 U.S.C. 9(i). 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 in order to 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 costs. This methodology enables us
to develop regulatory fees which more closely reflect our costs of
regulation and also allows us to make annual revisions to our fees
based to 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. See 47 U.S.C. 159(b)(4)(B).
III. Discussion
A. Summary of FY 1998 Fee Methodology
8. As noted above, Congress has required that the Commission
recover $162,523,000 for FY 1998 through the collection of regulatory
fees, representing the costs applicable to our enforcement, policy and
rulemaking, international, and user information activities. See 47
U.S.C. 159(a).
9. In developing our proposed FY 1998 fee schedule, we first
determined that we would continue to use the same general methodology
as we used in developing fees for FY 1997. We next estimated payment
units 1 for FY 1998 in order to determine the aggregate
amount of revenue we would collect without any revision to our FY 1997
fees. Next, we compared this revenue amount to the $162,523,000 that
Congress has required us to collect in FY 1998 and pro-rated the
overage among all the existing fee categories.
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\1\ 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. We then separately projected revenue requirements in each
service category using data generated by our cost accounting system and
established a revenue ceiling in each service no higher than 25 percent
above the revenue that payers within a fee category would have paid if
FY 1998 fees had remained at FY 1997 levels (adjusted only for changes
in volume and the increase required by Congress). This methodology,
described in our FY 1997 Report and Order at paragraph 35, reduces fees
for services whose regulatory costs have declined and increases fees
for services experiencing higher regulatory costs in order to continue
to eliminate disparities disclosed by our cost accounting system
between a service's current costs and fees ascribed to these services
in prior fiscal years. The 25 percent limitation minimizes the impact
of unexpected substantial increases to fees which could affect the
well-being of licensees.
11. Once we established our tentative FY 1998 fees, we evaluated
proposals made by Commission staff concerning other adjustments to the
Fee Schedule and to our collection procedures. These proposals are
discussed in paragraphs 20-30 and are factored into our proposed FY
1998 Schedule of Regulatory Fees, set forth in Attachment F.
12. Finally, we have incorporated, as Attachment H, proposed
Guidance containing detailed descriptions of each fee category,
information on the individual or entity responsible for 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 1998. 2 In the following paragraphs, we
describe in greater detail our proposed methodology for establishing
our FY 1998 regulatory fees.
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\2\ We also will incorporate a similar Attachment in the Report
and Order concluding this rulemaking. That Attachment will contain
updated information concerning any changes made to the proposed fees
adopted by the Report and Order.
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B. Development of FY 1998 Fees
i. Adjustment of Payment Units
13. As the first step in calculating individual service regulatory
fees for FY 1998, we adjusted the estimated payment units for each
service because payment units for many services have changed
substantially since we adopted our FY 1997 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.3
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\3\ It is important to also note that Congress' required revenue
increase in regulatory fee payments of approximately seven percent
in FY 1998 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 our FY 1997 fee amounts in each fee category to determine how much
revenue we would collect without any change to the FY 1997 Schedule of
Regulatory Fees. The amount of revenue we would collect without changes
in the fee schedule is approximately $171.5 million. This amount is
approximately $9 million more than the amount the Commission is
required to collect in FY 1998. We then adjusted these revenue
requirements for each fee category on a
[[Page 16191]]
proportional basis, consistent with section 9(b)(2) of the Act, to
obtain an estimate of revenue requirements for each fee category at the
$162,523,000 level required by Congress for FY 1998. Attachment C
provides detailed calculations showing how we determined the revised
revenue amount for each service.
iii. Calculation of Regulatory Costs
15. In accordance with section 159(i) of the Act, the Commission
utilizes a cost accounting system designed, in part, to provide data
which helps to ensure that fees closely reflect our actual costs of
regulation for each service category. The Commission's cost accounting
system accumulates both personnel and non-personnel costs on a service-
by-service basis and is described in detail in our FY 1997 Report and
Order at paragraph 12.
16. In order to utilize actual costs for fee development purposes,
we first add indirect support costs to direct costs 4 and
then adjust the results to approximate the amount of revenue that
Congress requires us to collect in FY 1998 ($162,523,000).5
In effect, we proportionally adjusted the actual cost data pertaining
to regulatory fee activities recorded for the period October 1, 1996
through September 30, 1997 (Fiscal Year 1997) among all the fee
categories so that total costs approximated $162,523,000. For fee
categories where fees are further differentiated by market (e.g.,
Markets 1-10 under the general VHF and UHF Commercial Television fee
categories), we distributed the costs to each market group by
maintaining the same ratios between the market groups as between the
revenue requirements in the FY 1997 fee schedule. The results of these
calculations are shown in detail in Attachment D and represent our best
estimate of actual total attributable costs relative to each fee
category for FY 1998.
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\4\ One feature of our cost accounting system is that it
separately identifies direct and indirect costs. Direct costs
include salary and expenses for (a) staff directly assigned to our
operating Bureaus and performing regulatory activities and (b) staff
assigned outside the operating Bureaus to the extent that their time
is spent performing regulatory activities pertinent to an operating
Bureau. These costs include rent, utilities and contractual costs
attributable to such personnel. Indirect costs include support
personnel assigned to overhead functions such as field and
laboratory staff and certain staff assigned to the Office of
Managing Director. The combining of direct and indirect costs is
accomplished on a proportional basis among all fee categories as
shown on Attachment D.
\5\ Congress' estimate of costs to be recovered through
regulatory fees is generally determined ten to twelve months before
the end of the fiscal year to which the fees actually apply. As
such, year-end actual activity costs for FY 1997 will not equal
exactly the amount Congress has designated for collection for FY
1998.
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iv. Establishment of 25% Revenue Ceilings
17. Our next step was to establish a ceiling of 25 percent on the
increase in the revenue requirement of each fee category (over and
above the Congressionally mandated increase in the overall revenue
requirement and the difference in unit counts) using the same
methodology we described in detail in our FY 1997 Report and Order.
Capping each fee category's revenue requirement at no more than a 25
percent increase enables us to continue the process of reducing fees
for services with lower costs and increasing fees for services with
higher costs in order to close the gap between actual costs and fees
designed to recover these costs.6
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\6\ We are not suggesting that fee increases are limited to a 25
percent increase over the FY 1997 fees. The 25 percent increase is
over and above the revenue which would be required after adjusting
for projected FY 1998 payment units and the proportional share of
the 6.56 percent increase in the amount that Congress is requiring
us to collect. Thus, FY 1998 fees may increase more than 25 percent
over FY 1997 fees depending upon the number of payment units. We are
also not suggesting that this methodology will always result in a
continuous closing of an existing gap between costs and fees
designed to recover these costs. Since actual costs for a fee
category may increase or decrease in consecutive years, the gap
could either close or widen depending upon whether or not actual
costs go down or up and by how much.
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18. As noted in our FY 1997 Report and Order, an important
consideration in utilizing a revenue ceiling is the impact on other fee
payers. Because the Commission is required to collect a full
$162,523,000 in FY 1998 regulatory fees, the additional revenue
($34,456,724) that would have been collected from licensees subject to
a revenue ceiling had there been no ceiling, needs to be collected
instead from licensees not subject to the ceiling. This results in a
certain amount of subsidization between fee payer classes.7
We believe, however, that the public interest is best served by this
methodology. To do otherwise would subject payers in some fee
categories to unexpected major fee increases which could severely
impact the economic well being of certain licensees. Attachment E
displays the step-by-step process we used to calculate adjusted revenue
requirements for each fee category for FY 1998, including the
reallocation of revenue requirements resulting from the application of
our revenue ceilings.8
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\7\ Revenues from current fee payers already offset costs
attributable to regulatees exempt from payment of a fee or otherwise
not subject to a fee pursuant to section 9(h) of the Act or the
Commission's rules. For example, CB and ship radio station users,
amateur radio licensees, governmental entities, licensees in the
public safety radio services, and all non-profit groups are not
required to pay a fee. The costs of regulating these entities is
borne by those regulatees subject to a fee requirement.
\8\ Application of the 25% ceiling was accomplished by choosing
a ``target'' fee revenue requirement for each individual fee
category. This ``target'' was either the actual calculated (cost-
based) revenue requirement (for those categories at or below the 25%
ceiling) or, in the case where the calculated revenue exceeded the
ceiling, an amount equal to the ceiling. The shortfall created by
reducing the revenue requirement of those whose revenue requirement
exceeded the revenue ceiling was proportionately spread among those
fee categories whose revenue requirements were below the ceiling.
This computation required more than one round of adjustment because
the allocation of this revenue, in a few instances, caused the new
revenue requirement amount to exceed the 25% ceiling. After three
iterations (rounds), all the revenue requirements were at or below
the revenue ceiling. See Attachment E.
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v. Recalculation of Fees
19. Once we determined the amount of fee revenue that it 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 E.
vi. Proposed Changes to Fee Schedule
20. We examined the results of our calculations made in paragraphs
15-19 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). As a result of this
review, we are proposing the following changes to our Fee Schedule:
a. Commercial AM & FM Radio. 21. For FY 1997 we established a
revised methodology for determining AM & FM radio regulatory fees. This
new methodology relies upon a radio station's calculated field strength
signal contour overlaid upon U.S. Census data to obtain an estimate of
population coverage for each station.9 The calculated
population coverages are then used along with a station's class to
[[Page 16192]]
develop a range of fees for both AM and FM radio stations.
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\9\ In FY 1997 we determined that the signal contour for AM
radio stations would be based upon a calculated signal strength of
0.5 mV/m from the transmitter location. For Class B FM stations the
contour was based upon a signal strength of 54 dBuV/m from the
transmitter location and for Class B1 FM stations the contour was
based upon a signal strength of 57 dBuV/m. For all other FM Classes,
a 60 dBuV/m contour was used. Attachment J describes in detail the
factors, measurements and calculations that go into determining
station signal contours and associated population coverages.
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22. Although the calculated contours used in FY 1997 are consistent
with Commission radio station signal protection policies and rules, we
received several complaints from licensees stating that the contours
exaggerated actual market areas and populations served. In several
instances licensees complained that small, rural stations whose
contours, at the fringe, intersected major metropolitan areas, were
attributed with populations far in excess of what they considered to be
their primary or even secondary market areas. See, for example, letters
from KTXC, dated September 10, 1997; Music Express Broadcasting
Corporation of Northeast Ohio, dated August 28, 1997; and Martin
Broadcasting Company, dated August 26, 1997. To alleviate this
disparity and to ensure that radio stations are assigned population
coverage figures more in line with their actual market areas, we are
proposing for FY 1998 to utilize the same general methodology for
determining regulatory fees as we introduced in FY 1997, but to change
the applicable signal contours to 5 m/V/m for AM radio stations and 70
dBuV/m for FM radio stations. These reduced contours are generally
consistent with the city grade contours of radio stations and should
limit population coverage to only those populations actually within a
station's primary local market area. We seek comment on this proposal.
It should be noted that population coverage is only one factor used to
determine radio station regulatory fees. For example, the number of
stations claiming non-profit exemption from fees impacts the number of
stations which may be assessed regulatory fees. Additionally, the
overall amount that Congress requires the Commission to collect and the
actual costs attributable to radio station regulation also influence
the final determination of fee amounts. The following paragraphs
explain in detail the development of our proposed fee schedule for AM
and FM radio stations.
23. We calculated the revenue requirements for each category of
station (e.g., AM, FM or construction permit) under our existing
methodology for assessing radio station fees as shown in Attachment E.
In order to consider both population and class of station, we then
multiplied the population served by the same ratio between the
individual classes as compared to the original FY 1994 Schedule to
determine the weighted population. The weighted approach also
streamlines the schedule by allowing us to combine AM and FM stations
into a single ``radio'' category.
24. Our next step was to sort the data by compiling a list of every
AM and FM station in descending order by class-weighted population.
Next, we determined actual fees for each station. We designed a
schedule which would place stations in wide bands based upon the
classes of station and total populations served, with different fees
for each band. We established the ranges for the schedule by first
proposing a minimum and a maximum fee amount. In setting a minimum fee,
we are proposing that it should be no less than the AM Construction
Permit fee which we calculated in Attachment E to be $235. Therefore,
we set the lowest radio fee at $250. In order to prevent the fee from
becoming too great a burden for any licensee, we are proposing to limit
the maximum fee to $2,500. At the same time, we are proposing to retain
the number of actual fee classifications at ten as in our FY 1997
Report and Order. This allowed us to establish fee classifications in
$250 increments, with each increment containing the same number of
stations, resulting in a more equitable fee schedule while keeping the
size of the schedule relatively manageable.10 The resulting
schedule of regulatory fees for radio stations (both AM and FM) would
read:
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\10\ The number of stations is not exactly divisible by 10,
leaving group 10 with five less stations than the other groups.
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Number
Classification group of Fee
stations
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1.................................................. 878 $2,500
2.................................................. 878 2,250
3.................................................. 878 2,000
4.................................................. 878 1,750
5.................................................. 878 1,500
6.................................................. 878 1,250
7.................................................. 878 1,000
8.................................................. 878 750
9.................................................. 878 500
10................................................. 873 250
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25. This schedule, which we propose today, results in: (1) same
class stations in different size cities generally having different
fees, (2) different class stations in the same city generally having
different fees, and (3) same class stations in the same city generally
having the same fee. In addition, it is generally true that in using
this methodology: (1) larger stations and those located in larger
metropolitan areas tend to be assessed higher fees and (2) small
stations and those located in rural areas tend to be assessed lower
fees. This proposed fee schedule achieves the objectives of both
assessing fees based on class of station and populations served,
thereby providing a fair and equitable means of distinguishing between
stations located in metropolitan areas and those located in rural
areas. Moreover, if a licensee believes that it has been improperly
placed in a particular fee classification group or that it will suffer
undue financial hardship from the fee assessment, our rules provide for
waiver, reduction or deferral of a fee as described in Sec. 1.1166 of
our rules. 47 U.S.C Sec. 1.1166.
b. Alternative Proposed Schedule for AM and FM Radio Stations.--26.
We also received a number of complaints that licensees could not easily
see how their station class was used in determining their regulatory
fee for FY 1997. Further, several licensees expressed the view that
there was not enough difference between the fees imposed on stations in
the largest population centers and those below. See, for example,
letter from Heckler Broadcasting, Inc. received October 2, 1997; and
Petition for Reduction of Regulatory Fee filed September 18, 1997, from
Family Communications, Inc. The alternative schedule shown below
addresses both of these concerns. However, it should be noted that
although the ratios between the classes in the alternative schedule
would no longer match the original schedule adopted by Congress, which
was implemented in our FY 1994 Report and Order, it addresses licensee
complaints that the differentiations between the size of service and
fee assessed in our existing schedule are inequitable. We invite public
comment on whether this alternative schedule for AM and FM Radio should
be implemented instead of the one proposed in paragraph 24.
AM Radio Station Regulatory Fees
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Population served Class A Class B Class C Class D
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<=20,000.................................................... $500="" $400="" $250="" $300="" 20,001--50,000..............................................="" 1,000="" 750="" 400="" 500="" [[page="" 16193]]="" 50,001--125,000.............................................="" 1,500="" 1,000="" 500="" 750="" 125,001--400,000............................................="" 2,000="" 1,500="" 750="" 1,000="" 400,001--1,000,000..........................................="" 3,000="" 2,500="" 1,250="" 1,750="">1,000,000.................................................. 4,250 3,500 2,000 2,500
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FM Radio Station Regulatory Fees
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Classes A, Classes B,
Population served B1 & C3 C, C1 & C2
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<=20,000...................................... $400="" $500="" 20,001--50,000................................="" 750="" 1,000="" 50,001--125,000...............................="" 1,000="" 1,500="" 125,001--400,000..............................="" 1,500="" 2,000="" 400,001--1,000,000............................="" 2,500="" 3,000="">1,000,000.................................... 3,500 4,250
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vii. Effect of Revenue Redistributions on Major Constituencies
27. The following chart illustrates the relative percentage of the
overall revenue requirements borne by the major constituencies since
inception of regulatory fees in FY 1994.
Percentage of Revenue Collected by Constituency
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Fiscal years--
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1994 1995 1996 1997 1998
(Actual) (Actual) (Actual) (Actual) (Proposed)
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Cable TV Operators (Inc. CARS Licenses)........ 41.4 24.0 33.4 21.8 18.1
Broadcast Licensees............................ 23.8 13.8 14.6 14.1 15.3
Satellite Operators (Inc. Earth Stations)...... 3.3 3.6 4.0 5.0 5.0
Common Carriers................................ 25.0 44.5 40.9 49.8 47.8
Wireless Licensees............................. 6.5 14.1 7.1 9.3 13.8
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Total.................................... 100.0 100.0 100.0 100.0 100.0
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C. Other Issues
i. Distinguishing between CMRS Fee Categories
28. We have received several comments from CMRS fee payers
concerning the difficulty some of them have had in distinguishing
between CMRS Mobile Services fees and CMRS Messaging Services fees. In
our FY 1997 Report and Order (see paragraphs 58-62) we stated that
Congress in its statutory fee schedule distinguished between licensees
that we authorized to provide exclusive use services and those we
authorized to provide only shared use services. Section (g) assesses a
higher fee upon licensees of exclusive use spectrum than upon licensees
of less valuable shared use spectrum. Similarly, the statutory fee
schedule established fees for broadcast licensees that consider the
type of service and class of service authorized. Moreover, since we
established the fee program, our fee schedules have adhered to
Congress' principle that our fee categories are to be based on the
authorization provided to a licensee rather than the use a particular
licensee makes of its authorized spectrum. Thus, we propose that our
fee schedule for CMRS will not consider the particular use made of a
licensee's spectrum and will consider the nature of services offered
only to the extent that services offered on broadband spectrum and
services offered on narrowband spectrum will be subject to different
categories of fee payment. Thus, licenses authorizing operations on
broadband spectrum would be subject to the CMRS Mobile Services fee,
regardless of the services offered on that spectrum by the licensee.
Further, licenses authorizing the provision of services on narrowband
spectrum would be subject to the CMRS Messaging Services fee,
regardless of the services offered on that spectrum. See also
Attachment H, paragraphs 14 and 15. We also tentatively conclude that
the Wireless Communications Service should be classified as CMRS Mobile
Services. We request comments on these matters. We also believe a
further clarification of which entities should be paying which CMRS fee
would be beneficial to licensees and other fee payers. Separately, we
propose to incorporate a clarification as to what is meant by CMRS
``units'' and who is responsible for paying regulatory fees for various
kinds of CMRS units. See also Attachment H, paragraph 16.
29. The following categories of CMRS licensees would be covered by
the CMRS Mobile Services regulatory fee:
Rural Radio Service
Air-ground Radiotelephone Service
Cellular Radiotelephone Service
Offshore Radiotelephone Service
Broadband Personal Communications Services
Wireless Communications Service
Specialized Mobile Radio Service
Public Coast Service
30. The following categories of CMRS licensees would be covered by
the CMRS Messaging Services regulatory fee:
Paging and Radiotelephone Service
Narrowband Personal Communications Services
220-222 MHz Band
Interconnected Business Radio Services
31. Licensees in the Specialized Mobile Radio Service have
requested reconsideration of our determination that FY 1997 CMRS
regulatory fees should be based upon whether a licensee operates on
broadband or
[[Page 16194]]
narrowband spectrum. See FY 1997 Report and Order at para. 60. We
expect to address these concerns in our action on petitions for
reconsideration of the FY 1997 Report and Order. Interested parties may
comment in this proceeding on the appropriate fee structure for CMRS
licensees and, in particular, may present alternatives to the
methodology we established for FY 1997. Commenters should be aware that
we do not believe that a case-by-case determination of the appropriate
fee for a particular SMR licensee would serve the public interest due
to the heavy resource burden it would require.
ii. Clarification of Operational LEO System
32. In our FY 1997 Report and Order at paragraph 75, we reiterated
our requirement that licensees of low earth orbit satellite systems
(LEOS) pay the LEO regulatory fee upon their certification of operation
of a single satellite pursuant to Sec. 25.120(d). We stated that we
require payment of the LEO fee following commencement of operations of
a system's first satellite in order to assure that we recover our
regulatory costs related to LEO systems from licensees of these systems
as early as possible so that regulatees in other services are not
burdened with these costs any longer than necessary. However, because
Sec. 25.120(d) applies to both geostationary and non-geostationary
satellite systems, we believe that we need to clarify our existing
definition of an operational LEO satellite. Non-geostationary satellite
licensees, including licensees of LEO systems, are required to submit
reports pursuant to Secs. 25.142(c), 25.143(e), and 25.145(g) of the
Commission's rules. These reports, annual and filed upon completion of
milestones, report the status of a [the] system and indicate compliance
under Sec. 25.120(d). In our FY 1997 Report and Order at paragraph 75,
we reiterated our requirement that licensees of low earth orbit
satellite systems (LEOS) pay the LEO regulatory fee upon their
certification of operation of a single satellite pursuant to
Sec. 25.120(d). We stated that we require payment of the LEO fee
following commencement of operations of a system's first satellite in
order to assure that we recover our regulatory costs related to LEO
systems from licensees of these systems as early as possible so that
regulatees in other services are not burdened with these costs any
longer than necessary. However, because Sec. 25.120(d) applies to both
geostationary and non-geostationary satellite systems, we believe that
we need to clarify our existing definition of an operational LEO
satellite to prevent misunderstanding of our intent as stated in
paragraph 75 of our FY 1997 Report and Order. As such, we propose to
add the following to our guidance (see Attachment H) relative to
determining whether or not a LEO satellite is operational for fee
assessment purposes:
Licensees of Non-Geostationary Satellite Systems will be assessed
the LEO regulatory fee upon the commencement of operation of a system's
first satellite as reported annually pursuant to Secs. 25.142(c),
25.143(e), 25.145(g) or upon certification of operation of a single
satellite pursuant to Sec. 25.120(d).
iii. Renaming of LEO Fee Category
33. ``Non-Geostationary'' satellite orbits were first introduced in
the early 90's with the filing of applications for non-voice, non-
geostationary satellite service operating below 1 GHz. These satellites
proposed to operate satellites in a ``low earth'' orbit, or a non-
geostationary orbit The term, ``low earth orbit'' was then synonomous
with ``non-geostationary''. As new technologies have evolved, we have
received applications proposing to operate in ``medium'' and ``high''
earth orbit technologies, also non-geostationary orbits[, have been
filed with the FCC]. Thus, we propose to change the name of the ``Low
Earth Orbit Satellite Systems'' fee category to the ``Non-Geostationary
Satellite Systems'' fee category in order to clarify that non-
geostationary satellites, whether operating in low, medium or high
orbits, are covered under this regulatory fee. This is consistent with
current industry use, as well as with Commission rules, which refer to
non-geostationary, not low earth, orbits and satellites. This name
change will have no adverse impact on any entity covered by regulatory
fees in FY 1998.
D. Procedures for Payment of Regulatory Fees
34. Generally, we propose to 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 proposing to establish 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
35. As we have in the past, we are proposing to treat 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 regulatory fee category. The payment dates for each
regulatory fee category will be announced either in the 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
36. While we are mindful that time constraints may preclude an
opportunity for installment payments, we propose that regulatees in any
category of service with a liability of $12,000 or more be eligible to
make installment payments and that eligibility for installment payments
be based upon the amount of either a single regulatory fee payment or
combination of fee payments by the same licensee or regulatee. We
propose that regulatees eligible to make installment payments may
submit their required fees in two equal payments (on dates to be
announced) or, in the alternative, in a single payment on the date that
their final installment payment is due. Due to statutory constraints
concerning notification to Congress prior to actual collection of the
fees, however, it is unlikely that there will be sufficient time for
installment payments, and that 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 installment payments, or a
single payment, will be announced either in the 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
37. As we have in the past, we are proposing to treat regulatory
fee payments by certain licensees as ``small'' fees subject to advance
payment consistent with the requirements of section 9(f)(2). We propose
that advance payments will be required from licensees of those services
that we
[[Page 16195]]
decided would be subject to advance payments in our FY 1994 Report and
Order, and to those additional payers set forth herein.11 We
are also proposing that payers of advance fees 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 would 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 our 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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\11\ 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,
General Mobile Radio Service (GMRS).
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iv. Minimum Fee Payment Liability
38. As we have in the past, we are proposing 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 1998.
v. Standard Fee Calculations and Payment Dates
39. As noted, the time for payment of standard fees and any
installment payments 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, we are proposing that fees be
submitted for any authorization held as of October 1, 1997. October 1
is the date to be used for establishing liability for payment of
standard fees.
40. In the case of regulatees whose fees are based upon a
subscriber, unit or circuit count, the number of a regulatees'
subscribers, units or circuits on December 31, 1997, will be used to
calculate the fee payment.12
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\12\ 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: Bulk-Rate
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 1997, rather than on a count as of December 31, 1997.
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E. Schedule of Regulatory Fees
41. The Commission's proposed Schedule of Regulatory Fees for FY
1998 is contained in Attachment F of this NPRM.
IV. Procedural Matters
A. Comment Period and Procedures
42. Pursuant to procedures set forth in Secs. 1.415 and 1.419 of
the Commission's rules, interested parties may file comments on or
before April 22, 1998, and reply comments on or before May 4, 1998. All
relevant comments will be considered by the Commission before final
action is taken in this proceeding. To file formally in this
proceeding, participants must file an original and four copies of all
comments, reply comments and supporting materials. If participants want
each Commissioner to receive a personal copy of their comments, an
original and nine copies must be filed. Comments and reply comments
should be sent to the Office of the Secretary, Federal Communications
Commission, Washington, D.C. 20554. Interested parties, who do not wish
to formally participate in this proceeding, may file informal comments
at the same address or may e-mail their comments to mcontee@fcc.gov.
Comments and reply comments will be available for public inspection
during regular business hours in the FCC Reference Center (Room 239) of
the Federal Communications Commission, 1919 M Street, N.W., Washington,
D.C. 20054.
B. Ex Parte Rules
43. This is a non-restricted notice and comment rulemaking
proceeding. Ex parte presentations are permitted, except during the
Sunshine Agenda period, provided they are disclosed pursuant to the
Commission's rules. See 47 CFR 1.1202, 1.1203 and 1026(a).
C. Initial Regulatory Flexibility Analysis
44. As required by the Regulatory Flexibility Act, see 5 U.S.C.
Sec. 603, the Commission has prepared an Initial Regulatory Flexibility
Analysis (IRFA) of the possible impact on small entities of the
proposals suggested in this document. The IRFA is set forth as
Attachment A. Written public comments are requested with respect to the
IRFA. These comments must be filed in accordance with the same filing
deadlines for comments on the rest of the NPRM, but they must have a
separate and distinct heading, designating the comments as responses to
the IRFA. The Office of Public Affairs, Reference Operations Division,
shall send a copy of this NPRM, including the IRFA, to the Chief
Counsel for Advocacy of the Small Business Administration, in
accordance with the Regulatory Flexibility Act.
D. Authority and Further Information
45. Authority for this proceeding is contained in sections 4(i) and
(j), 9, and 303(r) of the Communications Act of 1934, as amended, 47
U.S.C. Secs. 154(i)-(j), 159, & 303(r). It is ordered that this NPRM is
adopted. It is further ordered that the Commission's Office of Public
Affairs, Reference Operations Division, shall send a copy of this NPRM,
including the Initial Regulatory Flexibility Analysis, to the Chief
Counsel for Advocacy of the Small Business Administration.
46. Further information about this proceeding may be obtained by
contacting the Fees Hotline at (202) 418-0192.
Federal Communications Commission.
Magalie Roman Salas,
Secretary.
Attachment A--Initial Regulatory Flexibility Analysis
1. As required by the Regulatory Flexibility Act
(RFA),13 the Commission has prepared this Initial Regulatory
Flexibility Analysis (IRFA) of the possible significant economic impact
on small entities by the policies and rules proposed in the present
Notice of Proposed Rulemaking, In the Matter of Assessment and
Collection of Regulatory Fees for Fiscal Year 1998. Written public
comments are requested on this IRFA. Comments must be identified as
responses to the IRFA and must be filed by the deadlines for comments
on the IRFA provided above in paragraph 42. The Commission will send a
copy of the NPRM, including this IRFA, to the Chief Counsel for
Advocacy of the Small Business Administration. See 5 U.S.C. 603(a). In
addition, the NPRM and IRFA (or summaries thereof)
[[Page 16196]]
will be published in the Federal Register. See id.
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\13\ See 5 U.S.C. Sec. 603. The RFA, see 5 U.S.C. Sec. 601 et.
seq., has been amended by the Contract With America Advancement Act
of 1996, Pub. L. No. 104-121, 110 Stat. 847 (1996) (CWAAA). Title II
of the CWAAA is the Small Business Regulatory Enforcement Fairness
Act of 1996 (SBREFA).
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I. Need for, and Objectives of, the Proposed Rules:
2. This rulemaking proceeding is initiated to obtain comments
concerning the Commission's proposed amendment of its Schedule of
Regulatory Fees. For Fiscal Year 1998, we intend to collect regulatory
fees in the amount of $162,523,000, the amount that Congress has
required the Commission to recover. The Commission seeks to collect the
necessary amount through its proposed revised fees, as contained in the
attached Schedule of Regulatory Fees, in the most efficient manner
possible and without undue burden to the public.
II. Legal Basis
3. This action, including publication of proposed rules, is
authorized under Sections (4)(i) and (j), 9, and 303(r) of the
Communications Act of 1934, as amended, 47 U.S.C. Secs. 154(i) and (j),
159, and 303(r).
III. Description and Estimate of the Number of Small Entities to
which the Proposed 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.14 The RFA
generally defines the term ``small entity'' as having the same meaning
as the terms ``small business,'' ``small organization,'' and ``small
governmental jurisdiction.'' 15 In addition, the term
``small business'' has the same meaning as the term ``small business
concern'' under the Small Business Act.16 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).17 A small organization is generally ``any not-for-
profit enterprise which is independently owned and operated and is not
dominant in its field.'' 18 Nationwide, as of 1992, there
were approximately 275,801 small organizations.19 ``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.'' 20 As of
1992, there were approximately 85,006 such jurisdictions in the United
States.21 This number includes 38,978 counties, cities, and
towns; of these, 37,566, or 96 percent, have populations of fewer than
50,000.22 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
proposed rules, if adopted.
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\14\ 5 U.S.C. Sec. 603(b)(3).
\15\ Id. Sec. 601(6).
\16\ 5 U.S.C. Sec. 601(3) (incorporating by reference the
definition of ``small business concern'' in 15 U.S.C. Sec. 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. Sec. 601(3).
\17\ Small Business Act, 15 U.S.C. Sec. 632 (1996).
\18\ 5 U.S.C. Sec. 601(4).
\19\ 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).
\20\ 5 U.S.C. Sec. 601(5).
\21\ U.S. Dept. of Commerce, Bureau of the Census, ``1992 Census
of Governments.''
\22\ Id.
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Cable Services or 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 revenue annually. 23 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. 24
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\23\ 13 CFR. Sec. 121.201, SIC code 4841.
\24\ 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).
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6. The Commission has developed its own definition of a small cable
system operator for the purposes of rate regulation. Under the
Commission's rules, a ``small cable company'' is one serving fewer than
400,000 subscribers nationwide.25 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
1995.26 Since then, some of those companies may have grown
to serve over 400,000 subscribers, 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.
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\25\ 47 CFR Sec. 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 (February 27, 1995).
\26\ Paul Kagan Associates, Inc., Cable TV Investor, Feb. 29,
1996 (based on figures for December 30, 1995).
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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.'' 27 The Commission has determined that there
are 66,000,000 subscribers in the United States. Therefore, we found
that an operator serving fewer than 660,000 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.28 Based on available data, we find that the
number of cable operators serving 660,000 subscribers or less totals
1,450. 29 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, 30 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
66,000,000 subcribers, and we have based our fee revenue estimates on
that figure.
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\27\ 47 U.S.C. Sec. 543(m)(2).
\28\ Id. Sec. 76.1403(b).
\29\ Paul Kagan Associates, Inc., Cable TV Investor, Feb. 29,
1996 (based on figures for Dec. 30, 1995).
\30\ 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
Sec. 76.1403(d).
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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),31 multipoint
distribution systems (MDS),32 satellite
[[Page 16197]]
master antenna systems (SMATV), and subscription television services.
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\31\ Direct Broadcast Services (DBS) are discussed with the
international services, infra.
\32\ Multipoint Distribution Services (MDS) are discussed with
the mass media services, infra.
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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 numbers of commercial wireless entities, appears to be data
the Commission publishes annually in its Telecommunications Industry
Revenue report, regarding the Telecommunications Relay Service
(TRS).33 According to data in the most recent report, there
are 3,459 interstate carriers.34 These carriers include,
inter alia, local exchange carriers, wireline carriers and service
providers, interexchange carriers, competitive access providers,
operator service providers, pay telephone operators, providers of
telephone toll service, providers of telephone exchange service, and
resellers.
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\33\ FCC, Telecommunications Industry Revenue: TRS Fund
Worksheet Data, Figure 2 (Number of Carriers Paying Into the TRS
Fund by Type of Carrier) (Nov. 1997) (Telecommunications Industry
Revenue).
\34\ Id.
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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.35 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.
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\35\ 13 CFR Sec. 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).
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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.'' 36
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\36\ See 13 CFR Sec. 121.201, SIC code 4813. Since the time of
the Commission's 1996 decision, Implementation of the Local
Competition Provisions in the Telecommunications Act of 1996, First
Report and Order, 11 FCC Rcd 15499, 16144-45 (1996), 61 FR 45476
(August 29, 1996), the Commission has consistently addressed in its
regulatory flexibility analyses the impact of its rules on such
ILECs.
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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.37 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, personal communications services
providers, covered specialized mobile radio providers, and resellers.
It seems certain that some of those 3,497 telephone service firms may
not qualify as small entities or small ILECs because they are not
``independently owned and operated.'' 38 For example, a PCS
provider that is affiliated with an interexchange carrier having more
than 1,500 employees would not meet the definition of a small business.
It 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 proposed rules, if adopted.
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\37\ 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).
\38\ See generally 15 U.S.C. Sec. 632(a)(1).
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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. 39 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.40 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 or small ILECs that may be affected by the
proposed rules, if adopted.
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\39\ 1992 Census, supra, at Firm Size 1-123.
\40\ 13 CFR Sec. 121.201, SIC code 4813.
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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.41 According to the most recent Telecommunications
Industry Revenue data, 1,371 carriers reported that they were engaged
in the provision of local exchange services.42 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 1,371 providers of local
exchange service are small entities or small ILECs that may be affected
by the proposed rules, if adopted.
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\41\ Id.
\42\ Telecommunications Industry Revenue, Figure 2.
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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.43
According to the most recent Telecommunications Industry Revenue data,
143 carriers reported that they were engaged in the provision of
interexchange services.44 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
[[Page 16198]]
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 143 small entity
IXCs that may be affected by the proposed rules, if adopted.
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\43\ 13 CFR Sec. 121.201, SIC code 4813.
\44\ Telecommunications Industry Revenue, Figure 2.
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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.45 According to the most recent Telecommunications
Industry Revenue data, 109 carriers reported that they were engaged in
the provision of competitive access services.46 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
109 small entity CAPs that may be affected by the proposed rules, if
adopted.
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\45\ 13 CFR Sec. 121.201, SIC code 4813.
\46\ Telecommunications Industry Revenue, Figure 2.
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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.47 According to the most
recent Telecommunications Industry Revenue data, 27 carriers reported
that they were engaged in the provision of operator
services.48 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 27 small entity
operator service providers that may be affected by the proposed rules,
if adopted.
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\47\ 13 CFR Sec. 121.201, SIC code 4813.
\48\ Telecommunications Industry Revenue, Figure 2.
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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.49 According to the most recent
Telecommunications Industry Revenue data, 441 carriers reported that
they were engaged in the provision of pay telephone
services.50 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 441 small entity
pay telephone operators that may be affected by the proposed rules, if
adopted.
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\49\ 13 CFR Sec. 121.201, SIC code 4813.
\50\ Telecommunications Industry Revenue, Figure 2.
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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.51 According to the
most recent Telecommunications Industry Revenue data, 339 reported that
they were engaged in the resale of telephone service.51a 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 339 small entity resellers that may be affected by the proposed
rules, if adopted.
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\51\ 13 CFR Sec. 121.201, SIC code 4813.
\51a\ Telecommunications Industry Revenue, Figure 2.
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20. 800 Service Subscribers.51b Neither the Commission
nor the SBA has developed a definition of small entities specifically
applicable to 800 service (``toll free'') subscribers. The most
reliable source of information regarding the number of 800 service
subscribers appears to be data the Commission collects on the 800
numbers in use.51c According to our most recent data, at the
end of 1995, the number of 800 numbers in use was 6,987,063. Similarly,
the most reliable source of information regarding the number of 888
service subscribers appears to be data the Commission collects on the
888 numbers in use.51d According to our most recent data, at
the end of August 1996, the number of 888 numbers that had been
assigned was 2,014,059. 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 6,987,063 small
entity 800 subscribers and fewer than 2,014,059 small entity 888
subscribers that may be affected by the proposed rules, if adopted.
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\51b\ We include all toll-free number subscribers in this
category, including 888 numbers.
\51c\ FCC, CCB Industry Analysis Division, FCC Releases, Study
on Telephone Trends, Tbl. 20 (May 16, 1996).
\51d\ FCC, CCB Industry Analysis Division, Long Distance Carrier
Code Assignments, p. 80, Tbl. 10B (Oct. 18, 1996).
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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).51e This definition provides that a small
entity is expressed as one with $11.0 million or less in annual
receipts.51f 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.51g The Census report does not provide more precise
data.
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\51e\ An exception is the Direct Broadcast Satellite (DBS)
Service, infra.
\51f\ 13 CFR Sec. 120.121, SIC code 4899.
\51g\ 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).
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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
[[Page 16199]]
international broadcast stations are subject to regulatory fee
payments.
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. There are
approximately 3000 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 3000 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 may
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 of the number of VSAT systems that
would constitute a small business under the SBA definition.
27. Mobile Satellite Earth Stations. There are two licensees. We do
not request nor collect annual revenue information, and thus are unable
to estimate of 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 of 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 46 space station licensees. We do not request nor collect
annual revenue information, and thus are unable to estimate of the
number of geostationary space stations that would constitute a small
business under the SBA definition.
30. Space Stations (Non-Geostationary). There are six 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 of 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.'' 51h This definition
provides that a small entity is one with $11.0 million or less in
annual receipts.51i 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 could 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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\51h\ 13 CFR Sec. 120.121, SIC code 4841.
\51i\ 13 CFR Sec. 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.51j The SBA defines a television
broadcasting station that has $10.5 million or less in annual receipts
as a small business.51k Television broadcasting stations
consist of establishments primarily engaged in broadcasting visual
programs by television to the public, except cable and other pay
television services.51l Included in this industry are
commercial, religious, educational, and other television stations.\52\
Also included are establishments primarily engaged in television
broadcasting and which produce taped television program materials.\53\
Separate establishments primarily engaged in producing taped television
program materials are classified under another SIC number.\54\ There
were 1,509 television stations operating in the nation in 1992.\55\
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.\56\ For 1992,\57\ the number of
television stations that produced less than $10.0 million in revenue
was 1,155 establishments.\58\ Only commercial stations are subject to
regulatory fees.
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\51j\ 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 (August
27, 1996), citing 5 U.S.C. Sec. 601(3).
\51k\ 13 CFR Sec. 121.201, SIC code 4833.
\51l\ 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).
\52\ 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.
\53\ 1992 Census, Series UC92-S-1, at Appendix A-9.
\54\ 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).
\55\ FCC News Release No. 31327 (Jan. 13, 1993); 1992 Census,
Series UC92-S-1, at Appendix A-9.
\56\ FCC News Release, ``Broadcast Station Totals as of December
31, 1997.''
\57\ 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.
\58\ 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.\59\ A radio broadcasting station is an establishment
primarily engaged in broadcasting aural programs by radio to the
public.\60\ Included in this industry are commercial, religious,
educational,
[[Page 16200]]
and other radio stations.\61\ Radio broadcasting stations which
primarily are engaged in radio broadcasting and which produce radio
program materials are similarly included.\62\ However, radio stations
which are separate establishments and are primarily engaged in
producing radio program material are classified under another SIC
number.\63\ The 1992 Census indicates that 96 percent (5,861 of 6,127)
radio station establishments produced less than $5 million in revenue
in 1992.\64\ Official Commission records indicate that 11,334
individual radio stations were operating in 1992.\65\ As of December
31, 1997, Commission records indicate that 12,27 radio stations were
operating, of which 7,465 were FM stations.\66\ Only commercial
stations are subject to regulatory fees.
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\59\ 13 CFR Sec. 121.201, SIC code 4832.
\60\ 1992 Census, Series UC92-S-1, at Appendix A-9.
\61\ Id.
\62\ Id.
\63\ Id.
\64\ 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.
\65\ FCC News Release, No. 31327 (Jan. 13, 1993).
\66\ FCC News Release, ``Broadcast Station Totals as of December
31, 1997.''
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34. Thus, the proposed rules, if adopted, will affect approximately
1,558 full power television stations, approximately 1,200 of which are
considered small businesses.\67\ Additionally, the proposed rules will
affect some 12,156 full power radio stations, approximately 11,670 of
which are small businesses.\68\ 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).\69\ 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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\67\ 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.
\68\ 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.
\69\ 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.\70\ Thus, radio or
television stations with fewer than five full-time employees are
exempted from certain EEO reporting and record keeping
requirements.\71\ We estimate that the total number of broadcast
stations with 4 or fewer employees is approximately 4,239.\72\
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\70\ 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. Sec. 632(a), as amended by section 222
of the Small Business Credit and Business Opportunity Enhancement
Act of 1992, Public Law 102-366, Sec. 222(b)(1), 106 Stat. 999
(1992), as further amended by the Small Business Administration
Reauthorization and Amendments Act of 1994, Public Law 103-403,
Sec. 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 (June 6, 1970).
\71\ See, e.g., 47 CFR Sec. 73.3612 (Requirement to file annual
employment reports on Form 395 applies to licensees with five or
more full-time employees); First Report and Order in Docket No.
21474 (Amendment of Broadcast Equal Employment Opportunity Rules and
FCC Form 395), 70 FCC 2d 1466 (1979), 50 FR 50329 (December 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 (March 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.
\72\ 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.\73\
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\73\ 13 C.F.R. Sec. 121.201, SIC code 4832.
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37. There are currently 2,720 FM translators and boosters, 4,952 TV
translators.\74\ 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.\75\
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\74\ FCC News Release, Broadcast Station Totals as of December
31, 1996, No. 71831 (Jan. 21, 1997).
\75\ 15 U.S.C. Sec. 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.\76\ 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.\77\ This definition of a small entity in the context of MDS
auctions has been approved by the SBA.\78\ These stations were licensed
prior to implementation of Section 309(j) of the Communications Act of
1934, as amended, 47 U.S.C. Sec. 309(j). Licenses for new MDS
facilities are now awarded to auction winners in Basic Trading Areas
(BTAs) and BTA-like areas.\79\ 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 1,878 MDS licensees are
subject to regulatory
[[Page 16201]]
fees and the number which are small businesses is unknown.
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\76\ For purposes of this item, MDS includes both the single
channel Multipoint Distribution Service (MDS) and the Multichannel
Multipoint Distribution Service (MMDS).
\77\ See 47 C.F.R. Sec. 1.2110 (a)(1).
\78\ 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 (July 17, 1995).
\79\ 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.\80\ According to the
Bureau of the Census, only twelve radiotelephone firms out of a total
of 1,178 such firms which operated during 1992 had 1,000 or more
employees.\81\ 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, 804 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.\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 cellular service carriers that
would qualify as small business concerns under the SBA's definition.
Consequently, we estimate that there are fewer than 804 small cellular
service carriers that may be affected by the proposed rules, if
adopted.
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\80\ 13 C.F.R. Sec. 121.201, SIC code 4812.
\81\ 1992 Census, Series UC92-S-1, at Table 5, SIC code 4812.
\82\ Telecommunications Industry Revenue, Figure 2.
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40. 220 MHz Radio Services. Because the Commission has not yet
defined a small business with respect to 220 MHz services, we will
utilize the SBA definition applicable to radiotelephone companies,
i.e., an entity employing no more than 1,500 persons.\83\ With respect
to 220 MHz services, the Commission has proposed a two-tiered
definition of small business for purposes of auctions: (1) for Economic
Area (EA) licensees, a firm with average annual gross revenues of not
more than $6 million for the preceding three years and (2) for regional
and nationwide licensees, a firm with average annual gross revenues of
not more than $15 million for the preceding three years. Given that
nearly all radiotelephone companies under the SBA definition employ no
more than 1,500 employees (as noted supra), we will consider the
approximately 1,500 incumbent licensees in this service as small
businesses under the SBA definition.
---------------------------------------------------------------------------
\83\ 13 C.F.R. Sec. 121.201, SIC code 4812.
---------------------------------------------------------------------------
41. 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.\84\ 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, 172 carriers
reported that they were engaged in the provision of either paging or
``other mobile'' services, which are placed together in the data.\85\
We do not have data specifying the number of these carriers that are
not independently owned and operated or have more than 1,500 employees,
and thus are unable at this time to estimate with greater precision the
number of paging carriers that would qualify as small business concerns
under the SBA's definition. Consequently, we estimate that there are
fewer than 172 small paging carriers that may be affected by the
proposed rules, if adopted. We estimate that the majority of private
and common carrier paging providers would qualify as small entities
under the SBA definition.
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\84\ 13 C.F.R. Sec. 121.201, SIC code 4812.
\85\ Telecommunications Industry Revenue, Figure 2.
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42. 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,\86\ and the most recent Telecommunications Industry Revenue
data shows that 172 carriers reported that they were engaged in the
provision of either paging or ``other mobile'' services.\87\
Consequently, we estimate that there are fewer than 172 small mobile
service carriers that may be affected by the proposed rules, if
adopted.
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\86\ 13 C.F.R. Sec. 121.201, SIC code 4812.
\87\ Telecommunications Industry Revenue, Figure 2.
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43. 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.\88\ 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. \89\ These
regulations defining ``small entity'' in the context of broadband PCS
auctions have been approved by the SBA.\90\ 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.\91\ 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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\88\ 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 June 24, 1996), 61 FR 33859 (July
1, 1996); see also 47 C.F.R. Sec. 24.720(b).
\89\ 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 (July 1, 1996).
\90\ 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).
\91\ FCC News, Broadband PCS, D, E and F Block Auction Closes,
No. 71744 (released January 14, 1997).
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44. Narrowband PCS. The Commission has auctioned nationwide and
regional licenses for narrowband PCS. There are 11 nationwide and 30
regional licensees for narrowband PCS.
[[Page 16202]]
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.
45. Rural Radiotelephone Service. The Commission has not adopted a
definition of small entity specific to the Rural Radiotelephone
Service.92 A significant subset of the Rural Radiotelephone
Service is the Basic Exchange Telephone Radio Systems
(BETRS).93 We will use the SBA's definition applicable to
radiotelephone companies, i.e., an entity employing no more than 1,500
persons.94 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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\92\ The service is defined in Section 22.99 of the Commission's
Rules, 47 C.F.R. Sec. 22.99.
\93\ BETRS is defined in Sections 22.757 and 22.759 of the
Commission's Rules, 47 C.F.R. Secs. 22.757, 22.759.
\94\ 13 C.F.R. Sec. 121.201, SIC code 4812.
---------------------------------------------------------------------------
46. Air-Ground Radiotelephone Service. The Commission has not
adopted a definition of small entity specific to the Air-Ground
Radiotelephone Service.95 Accordingly, we will use the SBA's
definition applicable to radiotelephone companies, i.e., an entity
employing no more than 1,500 persons.96 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.
---------------------------------------------------------------------------
\95\ The service is defined in Section 22.99 of the Commission's
Rules, 47 C.F.R. Secs. 22.99.
\96\ 13 C.F.R. Sec. 121.201, SIC code 4812.
---------------------------------------------------------------------------
47. 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.97 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.
---------------------------------------------------------------------------
\97\ See 47 C.F.R. Sec. 90.814(b)(1).
---------------------------------------------------------------------------
48. 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.
49. The Commission has held auctions for geographic area licenses
in the 900 MHz SMR band, and recently completed an auction for
geographic area 800 MHz SMR licenses. There were 60 winning bidders who
qualified as small entities in the 900 MHz auction. In the recently
concluded 800 MHz SMR auction there were 524 licenses awarded to
winning bidders, of which 38 were won by small or very small entities.
50. 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.
51. 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 98 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.
---------------------------------------------------------------------------
\98\ Federal Communications Commission, 60th Annual Report,
Fiscal Year 1994, at 116.
---------------------------------------------------------------------------
52. Amateur Radio Service. We estimate that 10,000 applicants will
apply for vanity call signs in FY 1998. All are presumed to be
individuals. All other amateur licensees are exempt from payment of
regulatory fees.
53. 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.99
---------------------------------------------------------------------------
\99\ 13 C.F.R. Sec. 121.201, SIC code 4812.
---------------------------------------------------------------------------
54. 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 16,500 will be subject to FY 1998 regulatory fees.
55. Fixed Microwave Services. Microwave services include common
carrier,100 private-operational fixed,101 and
broadcast auxiliary radio services.102 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
[[Page 16203]]
companies--i.e., an entity with no more than 1,500
persons.103 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.
---------------------------------------------------------------------------
\100\ 47 C.F.R. Sec. 101 et seq. (formerly, Part 21 of the
Commission's Rules).
\101\ Persons eligible under Parts 80 and 90 of the Commission's
rules can use Private Operational-Fixed Microwave services. See 47
C.F.R. 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.
\102\ Auxiliary Microwave Service is governed by Part 74 of
Title 47 of the Commission's Rules. See 47 C.F.R. Sec. 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.
\103\ 13 C.F.R. Sec. 121.201, SIC 4812.
---------------------------------------------------------------------------
56. Public Safety Radio Services. Public Safety radio services
include police, fire, local government, forestry conservation, highway
maintenance, and emergency medical services.104 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.105 All
licensees in this category are exempt from the payment of regulatory
fees.
---------------------------------------------------------------------------
\104\ With the exception of the special emergency service, these
services are governed by Subpart B of Part 90 of the Commission's
Rules, 47 C.F.R. Secs. 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 C.F.R. Secs. 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 C.F.R. Secs. 90.33-
90.55.
\105\ 5 U.S.C. Sec. 601(5).
---------------------------------------------------------------------------
57. 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).106 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.
---------------------------------------------------------------------------
\106\ 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 C.F.R. Secs. 95.401-95.428; Secs. 95.1-
95.181; Secs. 95.201-95.225; 47 C.F.R. Secs. 95.191-95.194.
---------------------------------------------------------------------------
58. 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.
107 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.
---------------------------------------------------------------------------
\107\ This service is governed by Subpart I of Part 22 of the
Commission's Rules. See 47 C.F.R. Secs. 22.1001--22.1037.
---------------------------------------------------------------------------
59. 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
60. 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. 108 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.
---------------------------------------------------------------------------
\108\ 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.
---------------------------------------------------------------------------
61. 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. Licensees who pay small fees in advance
supply fee information as part of their application and do not need to
use the FCC Form 159.
62. 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% in addition to the required fee.
109 Until payment is received, no new or pending
[[Page 16204]]
applications will be processed, and existing authorizations may be
subject to rescission. 110 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. 111 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. 112
---------------------------------------------------------------------------
\109\ 47 U.S.C. 1.1164(a).
\110\ 47 U.S.C. 1.1164(c).
\111\ Public Law 104-134, 110 Stat. 1321 (1996).
\112\ 31 U.S.C. 7701(c)(2)(B).
---------------------------------------------------------------------------
63. 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. 113 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.
---------------------------------------------------------------------------
\113\ 47 U.S.C. Sec. 1.1166.
---------------------------------------------------------------------------
V. Steps Taken to Minimize Significant Economic Impact on Small
Entities, and Significant Alternatives Considered
64. The Omnibus Consolidated Appropriation Act, Public Law 105-119,
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) 1998. See 47 U.S.C.
Sec. 159(a). We seek comment on the proposed methodology for
implementing these statutory requirements and any other potential
impact of these proposals on small entities.
65. 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
proposed in this NPRM minimizes this impact by limiting the amount of
increase and shifting costs to other services which, for the most part,
are larger entities.
66. Several categories of licensees and regulatees are exempt from
payment of regulatory fees. See, e.g., footnote 108, supra, and
Attachment H of the NPRM, infra.
VI. Federal Rules that May Duplicate, Overlap, or Conflict with the
Proposed Rules
67. None.
Attachment B--Sources of Payment Unit Estimates for FY 1998
In order to calculate individual service fees for FY 1998, we
adjusted FY 1997 payment units for each service to more accurately
reflect expected FY 1998 payment liabilities. We obtained our updated
estimates through a variety of means. For example, we used Commission
licensee data bases, actual prior year payment records and industry and
trade association projections when available. We tried to obtain
verification for these estimates from multiple sources and, in all
cases, we compared FY 1998 estimates with actual FY 1997 payment units
to ensure that our revised estimates were reasonable. Where it made
sense, we adjusted and/or rounded our final estimates to take into
consideration the fact that certain variables that impact on the number
of payment units cannot yet be estimated exactly. These include an
unknown number of waivers and/or exemptions that may occur in FY 1998
and the fact that, in many services, the number of actual licensees or
station operators fluctuates from time to time due to economic,
technical or other reasons. Therefore, when we note, for example, that
our estimated FY 1998 payment units are based on FY 1997 actual payment
units, it does not necessarily mean that our FY 1998 projection is
exactly the same number as FY 1997. It means that we have either
rounded the FY 1998 number or adjusted it slightly to account for these
variables.
------------------------------------------------------------------------
Fee category Sources of payment unit estimates
------------------------------------------------------------------------
Land Mobile (All), Microwave, IVDS Based on Wireless Telecommunications
\114\, Marine (Ship & Coast), Bureau (WTB) projections of new
Aviation (Aircraft & Ground), applications and renewals taking
GMRS, Amateur Vanity Call Signs, into consideration existing
Domestic Public Fixed. Commission licensee data bases.
Aviation (Aircraft) and Marine
(Ship) estimates have been adjusted
to take into consideration the
licensing of portions of these
services on a voluntary basis.
CMRS Mobile Services.............. Based on actual FY 1997 payment
units adjusted to take into
consideration industry estimates of
growth between FY 1997 and FY 1998
and Wireless Telecommunications
Bureau projections of new
applications and average number of
mobile units associated with each
application.
CMRS Messaging Services........... Based on industry estimates of the
number of units in operation.
AM/FM Radio Stations.............. Based on actual FY 1997 payment
units.
UHF/VHF Television Stations....... Based on actual FY 1997 payment
units.
AM/FM/TV Construction Permits..... Based on actual FY 1997 payment
units.
LPTV, Translators and Boosters.... Based on actual FY 1997 payment
units.
Auxiliaries....................... Based on actual FY 1997 payment
units.
MDS/MMDS.......................... Based on actual FY 1997 payment
units.
Cable Antenna Relay Service (CARS) Based on actual FY 1997 payment
units.
Cable Television System Based on Cable Services Bureau and
Subscribers. industry estimates of
subscribership.
Interstate Telephone Service Based on actual FY 1997 interstate
Providers. revenues associated with
contributions to the
Telecommunications Relay System
(TRS) Fund, adjusted to take into
consideration FY 1998 revenue
growth in this industry as
estimated by the Common Carrier
Bureau.
Earth Stations.................... Based on actual FY 1997 payment
units.
Space Stations (GEOs & NGEOs)..... Based on International Bureau
licensee data bases.
International Bearer Circuits..... Based on International Bureau
estimate.
[[Page 16205]]
International HF Broadcast Based on actual FY 1997 payment
Stations, International Public units.
Fixed Radio Service.
------------------------------------------------------------------------
\114\ The Wireless Telecommunications Bureau's staff advises that they
do not anticipate receiving any applications for IVDS in FY 1998.
Therefore, since there is no volume, there will be no regulatory, fee
in the IVDS category for FY 1998.
Attachment C--Calculation of Revenue Requirements
--------------------------------------------------------------------------------------------------------------------------------------------------------
Computed FY 1998 Pro-rated
Fee category FY 1998 payment x FY 1997 Fee x Payment years = revenue revenue
units requirement requirement
--------------------------------------------------------------------------------------------------------------------------------------------------------
LM (220 MHz, >470 MHZ-Base, SMRS)............... 4,645 10 5 232,250 225,691
Private Microwave............................... 3,830 10 10 383,000 372,184
Domestic Public Fixed/Commercial Microwave...... 5,150 10 10 515,000 500,456
IVDS............................................ 0 0 5 0 0
Marine (Ship)................................... 16,500 5 10 825,000 801,702
GMRS/Other LM................................... 72,465 5 5 1,811,625 1,760,465
Aviation (Aircraft)............................. 3,500 5 10 175,000 170,058
Marine (Coast).................................. 1,370 5 5 34,250 33,283
Aviation (Ground)............................... 1,865 5 5 46,625 45,308
Amateur Vanity Call Signs....................... 10,000 5 10 500,000 485,880
AM/FM Radio..................................... 8,646 1,126 1 9,735,396 9,460,469
AM Construction Permits......................... 62 195 1 12,090 11,749
FM Construction Permits......................... 473 950 1 449,350 436,660
Satellite TV.................................... 105 950 1 99,750 96,933
Satellite TV Construction Permit................ 10 345 1 3,450 3,353
VHF Markets 1-10................................ 42 35,025 1 1,471,050 1,429,508
VHF Markets 11-25............................... 61 28,450 1 1,735,450 1,686,441
VHF Markets 26-50............................... 71 18,600 1 1,320,600 1,283,306
VHF Markets 51-100.............................. 118 9,850 1 1,162,300 1,129,477
VHF Remaining Markets........................... 207 2,725 1 564,075 548,146
VHF Construction Permits........................ 10 4,800 1 48,000 46,644
UHF Markets 1-10................................ 94 16,850 1 1,583,900 1,539,171
UHF Markets 11-25............................... 96 13,475 1 1,293,600 1,257,069
UHF Markets 26-50............................... 124 8,750 1 1,085,000 1,054,360
UHF Markets 51-100.............................. 172 4,725 1 812,700 789,749
UHF Remaining Markets........................... 182 1,350 1 245,700 238,761
UHF Construction Permits........................ 50 2,975 1 148,750 144,549
Auxiliaries..................................... 20,000 25 1 500,000 485,880
International HF Broadcast...................... 4 390 1 1,560 1,516
LPTV/Translators/Boosters....................... 2,290 220 1 503,800 489,573
CARS............................................ 1,800 65 1 117,000 113,696
Cable Systems................................... 66,000,000 0.54 1 35,640,000 34,633,530
Interstate Telephone Service Providers.......... 70,103,000,000 0.00116 1 81,319,480 79,023,026
CMRS Mobile Services (Cellular/Public Mobile)... 55,540,000 0.24 1 13,329,600 12,953,173
CMRS--Messaging................................. 39,592,000 0.03 1 1,187,760 1,154,218
MDS/MMDS........................................ 1,878 215 1 403,770 392,368
International Circuits.......................... 325,000 5 1 1,625,000 1,579,110
International Public Fixed...................... 3 310 1 930 904
Earth Stations.................................. 3,000 515 1 1,545,000 1,501,369
Space Stations (Geostationary Orbit)............ 46 97,975 1 4,506,850 4,379,577
Space Stations (Non-Geostationary Orbit)........ 2 135,675 1 271,350 263,687
---------------------------------------
****** Total Estimated Revenue Collected.... ................ ................ ................ 167,246,011 162,523,000
****** Total Revenue Requirement............ ................ ................ ................ 162,523,000 162,523,000
Difference.............................. ................ ................ ................ 4,723,011 0
** 0.971760098 factor applied
--------------------------------------------------------------------------------------------------------------------------------------------------------
[[Page 16206]]
Attachment D.--Calculation of Regulatory Costs
----------------------------------------------------------------------------------------------------------------
Total costs
Actual FY 1997 Overhead and with overhead Total costs
Fee category regulatory other indirect and other pro-rated to Adjusted pro-
costs pro rated indirect pro $162 million** rated costs***
rated
----------------------------------------------------------------------------------------------------------------
LM (220 MHz, >470 MHZ-Base,
SMRS)........................ 1,952,428 98,195 2,050,623 2,113,136 2,113,136
Microwave..................... 4,860,809 244,469 5,105,277 5,260,912 5,260,912
IVDS.......................... 2,122,499 106,749 2,229,248 2,297,206 2,297,206
Marine (Ship)................. 2,754,238 138,521 2,892,759 2,980,945 2,980,945
GMRS/Other LM................. 5,943,682 298,930 6,242,612 6,432,918 6,432,918
Aviation (Aircraft)........... 980,895 49,333 1,030,228 1,061,635 1,061,635
Marine (Coast)................ 685,608 34,482 720,090 742,041 742,041
Aviation (Ground)............. 562,239 28,277 590,516 608,518 608,518
Amateur Vanity Call Signs..... 88,615 4,457 93,072 95,909 95,909
AM/FM Radio................... 14,125,529 710,427 14,835,955 15,288,230 14,396,926
AM Construction Permits... ............... .............. ............... .............. 103,960
FM Construction Permits... ............... .............. ............... .............. 787,344
Satellite TV.................. ............... .............. ............... .............. 70,397
Satellite TV Construction
Permit....................... ............... .............. ............... .............. 11,690
VHF Television................ 4,957,533 249,333 5,206,866 5,365,598 ..............
VHF Markets 1-10.......... ............... .............. ............... .............. 1,291,499
VHF Markets 11-25......... ............... .............. ............... .............. 1,129,458
VHF Markets 26-50......... ............... .............. ............... .............. 1,371,983
VHF Markets 51-100........ ............... .............. ............... .............. 1,000,147
VHF Remaining Markets..... ............... .............. ............... .............. 502,757
VHF Construction Permits.. ............... .............. ............... .............. 30,584
UHF Television................ 2,954,865 148,611 3,103,476 3,198,086 ..............
UHF Markets 1-10.......... ............... .............. ............... .............. 1,023,388
UHF Markets 11-25......... ............... .............. ............... .............. 756,347
UHF Markets 26-50......... ............... .............. ............... .............. 531,842
UHF Markets 51-100........ ............... .............. ............... .............. 484,190
UHF Remaining Markets..... ............... .............. ............... .............. 202,119
UHF Construction Permits.. ............... .............. ............... .............. 166,940
Auxiliaries................... 146,460 7,366 153,826 158,515 158,515
International HF Broadcast.... 217,931 10,961 228,891 235,869 235,869
LPTV/Translators/Boosters..... 736,547 37,044 773,590 797,173 797,173
CARS.......................... 61,797 3,108 64,905 66,883 66,883
Cable Systems................. 20,125,023 1,012,164 21,137,187 21,781,555 21,781,555
Interstate Telephone Service
Providers.................... 53,234,026 2,677,341 55,911,367 57,615,828 57,615,828
CMRS Mobile Services (Cellular/
Public Mobile)............... 11,273,798 567,002 11,840,801 12,201,768 12,201,768
CMRS--One Way Paging.......... 6,015,701 302,552 6,318,254 6,510,866 6,510,866
MDS/MMDS...................... 1,357,260 68,262 1,425,521 1,468,979 1,468,979
International Circuits........ 8,253,772 415,114 8,668,886 8,933,157 8,933,157
International Public Fixed.... 193,436 9,729 203,165 209,358 209,358
Earth Stations................ 339,999 17,100 357,099 367,985 367,985
Space Stations (Geostationary
Orbit)....................... 5,677,889 285,563 5,963,452 6,145,248 6,145,248
Space Stations (Non-
Geostationary Orbit)......... 540,215 27,169 567,385 584,681 584,681
Overhead & Other Indirect
Costs........................ 7,552,257 .............. ............... .............. ..............
---------------------------------------------------------------------------------
*****Total............ 157,715,049 7,552,257 157,715,049 162,523,000 162,532,656
*****Total Revenue
Requirement.......... 162,523,000 .............. 162,523,000 162,523,000 162,523,000
Difference............ (4,807,951) .............. (4,807,951) .............. 9,656
----------------------------------------------------------------------------------------------------------------
**1.046987 factor applied
***The pro rated costs shown in the previous column needed to be adjusted to sub-allocate TV and radio costs.
Note: Columns may not add due to rounding.
[[Page 16207]]
Attachment E.--Calculation of FY 1998 Regulatory Fees
----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Costs vs.
Pro-rated Adjusted revenue Pro-revenue Round 1 Round 1 Round 1 Pro- Round 2 Round 2 Round 2 Pro- Computed Rounded new
Fee category revenue activity requirement requirement Target Adjustable rated Target Adjustable rated new FY 1998 FY 1998 Expected FY
requirement costs difference plus 25% revenue target target revenue target target regulatory regulatory 1998 revenue
(percent) ceiling revenue revenue revenue revenue fee fee
----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
LM (220 MHz, >470MHZ-Base, SMRS)........................... 225,691 2,113,136 836.30 282,114 282,114 ........... 282,114 282,114 ........... 282,114 12 12 278,700
Microwave.................................................. 872,640 5,260,912 502.87 1,090,800 1,090,800 ........... 1,090,800 1,090,800 ........... 1,090,800 12 12 1,077,600
IVDS....................................................... 0 2,297,206 ........... 0 0 ........... 0 0 ........... 0 0 0 0
Marine (Ship).............................................. 801,702 2,980,945 271.83 1,002,128 1,002,128 ........... 1,002,128 1,002,128 ........... 1,002,128 6 6 990,000
GMRS/Other LM.............................................. 1,760,465 6,432,918 265.41 2,200,581 2,200,581 ........... 2,200,581 2,200,581 ........... 2,200,581 6 6 2,173,950
Aviation (Aircraft)........................................ 170,058 1,061,635 524.28 212,573 212,573 ........... 212,573 212,573 ........... 212,573 6 6 210,000
Marine (Coast)............................................. 33,283 742,041 2129.49 41,604 41,604 ........... 41,604 41,604 ........... 41,604 6 6 41,100
Aviation (Ground).......................................... 45,308 608,518 1243.07 56,635 56,635 ........... 56,635 56,635 ........... 56,635 6 6 55,950
Amateur Vanity Call Signs.................................. 485,880 95,909 -80.26 607,350 607,350 95,909 128,310 128,310 128,310 128,757 1.29 1.29 128,757
AM/FM Radio................................................ 9,460,469 14,396,926 52.18 11,825,586 11,825,586 ........... 11,825,586 11,825,586 ........... 11,825,586 1,368 1,375 11,888,250
AM Construction Permits.................................... 11,749 103,960 784.84 14,686 14,686 ........... 14,686 14,686 ........... 14,686 237 235 14,570
FM Construction Permits.................................... 436,660 787,344 80.31 545,825 545,825 ........... 545,825 545,825 ........... 545,825 1,154 1,150 543,950
Satellite TV............................................... 96,933 70,397 -27.38 121,166 121,166 70,397 94,179 94,179 94,179 94,508 900 900 94,500
Satellite TV Construction Permit........................... 3,353 11,690 248.64 4,191 4,191 ........... 4,191 4,191 ........... 4,191 419 420 4,200
VHF Markets 1-10........................................... 1,429,508 1,291,499 -9.65 1,786,885 1,291,499 1,291,499 1,727,804 1,727,804 1,727,804 1,733,829 41,282 41,275 1,733,550
VHF Markets 11-25.......................................... 1,686,441 1,129,458 -33.03 2,108,051 1,129,458 1,129,458 1,511,021 1,511,021 1,511,021 1,516,290 24,857 24,850 1,515,850
VHF Markets 26-50.......................................... 1,283,306 1,371,986 6.91 1,604,133 1,371,986 1,371,986 1,835,481 1,604,133 ........... 1,604,133 22,593 22,600 1,604,600
VHF Markets 51-100......................................... 1,129,477 1,000,147 -11.45 1,411,846 1,000,147 1,000,147 1,338,025 1,338,025 1,338.025 1,342,691 11,379 11,375 1,342,250
VHF Remaining Markets...................................... 548,146 502,757 -8.28 685,183 502,757 502,757 672,602 672,602 672,602 674,948 3,261 3,250 672,750
VHF Construction Permits................................... 46,644 30,584 -34.43 58,305 30,584 30,584 40,916 40,916 40,916 41,059 4,106 4,100 41,000
UHF Markets 1-10........................................... 1,539,171 1,023,388 -33.51 1,923,964 1,023,388 1,023,388 1,369,117 1,369,117 1,369,117 1,373,892 14,616 14,625 1,374,750
UHF Markets 11-25.......................................... 1,257,069 756,347 -39.83 1,571,336 756,347 756,347 1,011,862 1,011,862 1,011,862 1,015,391 10,577 10,575 1,015,200
UHF Markets 26-50.......................................... 1,054,360 531,842 -49.56 1,317,950 531,842 531,842 711,513 711,513 711,513 713,994 5,758 5,750 713,000
UHF Markets 51-100......................................... 789,749 484,190 -38.69 987,186 484,190 484,190 647,763 647,763 647,763 650,022 3,779 3,775 649,300
UHF Remaining Markets...................................... 238,761 202,119 -15.35 298,451 202,119 202,119 270,400 270,400 270,400 271,343 1,491 1,500 273,000
UHF Construction Permits................................... 144,549 166,940 15.49 180,686 166,940 166,940 223,337 180,686 ........... 180,686 3,614 3,625 181,250
Auxiliaries................................................ 485,880 158,515 -67.38 607,350 158,515 158,515 212,066 212,066 212,066 212,805 11 11 220,000
International HF Broadcast................................. 1,516 235,869 15458.64 1,895 1,895 ........... 1,895 1,895 ........... 1,895 474 475 1,900
LPTV/Translators/Boosters.................................. 489,573 797,173 62.83 611,966 611,966 ........... 611,966 611,966 ........... 611,966 267 265 606,850
CARS....................................................... 113,696 66,883 -41.17 142,120 66,883 66,883 89,478 89,478 89,478 89,790 50 50 90,000
Cable Systems.............................................. 34,633,530 21,781,555 -37.11 43,291,913 21,781,555 21,781,555 29,139,975 29,139,975 29,139,975 29,241,595 0.44 0.44 29,241,595
Interstate Telephone Service Providers..................... 79,023,026 57,615,828 -27.09 98,778,783 57,615,828 57,615,828 77,080,070 77,080,070 77,080,070 77,348,871 0.00110 0.00110 77,348,871
CMRS Mobile Services (Cellular/Public Mobile).............. 12,953,173 12,201,768 -5.80 16,191,466 12,201,768 12,201,768 16,323,867 16,191,466 ........... 16,191,466 0.29 0.29 16,191,466
CMRS Messaging Services.................................... 1,154,218 6,510,866 464.09 1,442,773 1,442,773 ........... 1,442,773 1,442,773 ........... 1,442,773 0.04 0.04 1,442,773
MDS/MMDS................................................... 392,368 1,468,979 274.39 490,460 490,460 ........... 490,460 490,460 ........... 490,460 261 260 488,280
International Circuits..................................... 1,579,110 8,933,157 465.71 1,973,888 1,973,888 ........... 1,973,888 1,973,888 ........... 1,973,888 6 6 1,950,000
International Public Fixed................................. 904 209,358 23059.07 1,130 1,130 ........... 1,130 1,130 ........... 1,130 377 375 1,125
Earth Stations............................................. 1,501,369 367,985 -75.49 1,876,711 367,985 367,985 492,301 492,301 492,301 494,017 165 165 495,000
Space Stations (Geostationary Orbit)....................... 4,379,577 6,145,248 40.32 5,474,471 5,474,471 ........... 5,474,471 5,474,471 ........... 5,474,471 119,010 119,000 5,474,000
Space Stations (Non-Geostationary Orbit)................... 263,687 584,681 121.73 329,609 329,609 ........... 329,609 329,609 ........... 329,609 164,804 164,800 329,600
****** Total Estimated Revenue Collected............... 162,522,999 162,532,659 ........... 203,153,749 128,453,011 100,850,097 162,523,000 162,116,000 116,537,401 162,523,000 ........... ........... 162,499,486
****** Total Revenue Requirement....................... 162,523,000 162,523,000 ........... 162,523,000 162,523,000 ........... 162,523,000 162,523,000 ........... 162,523,000 ........... ........... 162,523,000
Difference........................................... (1) 9,659 ........... 40,630,749 (34,069,989) ........... 0 (406,400) ........... 0 ........... ........... (23,514)
----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
** 1.33782803 factor applied
*** 1.003487295 factor applied
[[Page 16208]]
Attachment F.--Proposed FY 1998 Schedule of Regulatory Fees
------------------------------------------------------------------------
Annual
Fee category regulatory
fee
------------------------------------------------------------------------
PMRS (per license) (Formerly Land Mobile--Exclusive Use at
220-222 MHz, above 470 MHz, Base Station and SMRS) (47 CFR
Part 90).................................................. 12
Microwave (per license) (47 CFR Part 101).................. 12
Interactive Video Data Service (per license) (47 CFR Part
95)....................................................... (\1\)
Marine (Ship) (per station) (47 CFR Part 80)............... 6
Marine (Coast) (per license) (47 CFR Part 80).............. 6
General Mobile Radio Service (per license) (47 CFR Part 95) 6
Land Mobile (per license) (all stations not covered by PMRS
and CMRS)................................................. 6
Aviation (Aircraft) (per station) (47 CFR Part 87)......... 6
Aviation (Ground) (per license) (47 CFR Part 87)........... 6
Amateur Vanity Call Signs (per call sign) (47 CFR Part 97). 1.29
CMRS Mobile Services (per unit) (47 CFR Parts 20, 22, 24,
27, 80 and 90)............................................ .29
CMRS One-Way Paging (per unit) (47 CFR Parts 20, 22 and 90) .04
Multipoint Distribution Services (per call sign) (47 CFR
Part 21).................................................. 260
AM & FM Radio (47 CFR Part 73):
Group 1................................................ 2,500
Group 2................................................ 2,250
Group 3................................................ 2,000
Group 4................................................ 1,750
Group 5.................................................... 1,500
Group 6................................................ 1,250
Group 7................................................ 1,000
Group 8................................................ 750
Group 9................................................ 500
Group 10............................................... 250
AM Construction Permits................................ 235
FM Construction Permits................................ 1,150
TV (47 CFR Part 73) VHF Commercial:
Markets 1-10........................................... 41,275
Markets 11-25.......................................... 24,850
Markets 26-50.......................................... 22,600
Markets 51-100......................................... 11,375
Remaining Markets...................................... 3,250
Construction Permits................................... 4,100
TV (47 CFR Part 73) UHF Commercial:
Markets 1-10........................................... 14,625
Markets 11-25.......................................... 10,575
Markets 26-50.......................................... 5,750
Markets 51-100......................................... 3,775
Remaining Markets...................................... 1,500
Construction Permits................................... 3,625
Satellite Television Stations (All Markets)................ 900
Construction Permits--Satellite Television Stations........ 420
Low Power TV, TV/FM Translators & Boosters (47 CFR Part 74) 265
Broadcast Auxiliary (47 CFR Part 74)....................... 11
Cable Antenna Relay Service (47 CFR Part 78)............... 50
Cable Television Systems (per subscriber).................. .44
Interstate Telephone Service Providers (per revenue dollar) .0011
Earth Stations (47 CFR Part 25)............................ 165
Space Stations (per operational station in geostationary
orbit) (47 CFR Part 25) also includes Direct Broadcast
Satellite Service (per operational station) (47 CFR Part
100)...................................................... 119,000
Space Stations (per operational system in non-geostationary
orbit) (47 CFR Part 25)................................... 164,800
International Circuits (per active 64KB circuit)........... 6
International Public Fixed (per call sign) (47 CFR Part 23) 375
International (HF) Broadcast (47 CFR Part 73).............. 475
------------------------------------------------------------------------
\1\ No fee.
Attachment G.--Comparison Between FY 1997 and Proposed FY 1998
Regulatory Fees
------------------------------------------------------------------------
Annual Proposed
regulatory regulatory
Fee category fee FY fee FY
1997 1998
------------------------------------------------------------------------
PMRS (per license) (Formerly Land Mobile-
Exclusive Use at 220-222 Mhz, above 470 Mhz,
Base Station and SMRS) (47 CFR Part 90)...... 10 12
Microwave (per license) (47 CFR Part 101)..... 10 12
Marine (Ship) (per station) (47 CFR Part 80).. 5 6
Marine (Coast) (per license) (47 CFR Part 80). 5 6
General Mobile Radio Service (per license) (47
CFR Part 95)................................. 5 6
[[Page 16209]]
Land Mobile (per license) (all stations not
covered by PMRS and CMRS).................... 5 6
Aviation (Aircraft) (per station) (47 CFR Part
87).......................................... 5 6
Aviation (Ground) (per license) (47 CFR Part
87).......................................... 5 6
Amateur Vanity Call Signs (per call sign) (47
CFR Part 97)................................. 5 1.29
CMRS Mobile Services (per unit) (47 CFR Parts
20, 22, 24, 27, 80 and 90)................... .24 .29
CMRS Messaging Services [formerly One Way
Paging] (per unit) (47 CFR Parts 20, 22, and
90).......................................... .03 .04
Multipoint Distribution Services (per call
sign) (47 CFR Part 21)....................... 215 260
Radio (47 CFR Part 73):
Group 1................................... 2,000 2,500
Group 2................................... 1,800 2,250
Group 3................................... 1,600 2,000
Group 4................................... 1,400 1,750
Group 5................................... 1,200 1,500
Group 6................................... 1,000 1,250
Group 7................................... 800 1,000
Group 8................................... 600 750
Group 9................................... 400 500
Group 10.................................. 200 250
AM Construction Permits....................... 195 235
FM Construction Permits....................... 950 1,150
TV (47 CFR Part 73) VHF Commercial:
Markets 1-10.............................. 35,025 41,275
Markets 11-25............................. 28,450 24,850
Markets 26-50............................. 18,600 22,600
Markets 51-100............................ 9,850 11,375
Remaining Markets......................... 2,725 3,250
Construction Permits...................... 4,800 4,100
TV (47 CFR Part 73) UHF Commercial:
Markets 1-10.............................. 16,850 14,625
Markets 11-25............................. 13,575 10,575
Markets 26-50............................. 8,750 5,750
Markets 51-100............................ 4,725 3,775
Remaining Markets......................... 1,350 1,500
Construction Permits...................... 2,975 3,625
Satellite Television Stations (All Markets)... 950 900
Construction Permits--Satellite Television
Stations..................................... 345 420
Low Power TV, TV/FM Translators & Boosters (47
CFR Part 74)................................. 220 265
Broadcast Auxiliary (47 CFR Part 74).......... 25 11
Cable Antenna Relay Service (47 CFR Part 78).. 65 50
Earth Stations (47 CFR Part 25)............... 515 165
Cable Television Systems (per subscriber) (47
CFR Part 76)................................. .54 .44
Interstate Telephone Service Providers (per
revenue dollar).............................. .00116 .0011
Space Stations (per operational station in
geostationary orbit) (47 CFR Part 25) also
includes Direct Broadcast Satellite Service
(per operational station) (47 CFR Part 100).. 97,975 119,000
Space Stations (per operational system in non-
geostationary orbit) (47 CFR Part 25)........ 135,675 164,800
International Bearer Circuits (per active 64KB
circuit)..................................... 5 6
International Public Fixed (per call sign) (47
CFR Part 23)................................. 310 375
International (HF) Broadcast (47 CFR Part 73). 390 475
------------------------------------------------------------------------
Attachment H--Detailed Guidance on Who Must Pay Regulatory Fees
1. The guidelines below provide an explanation of regulatory fee
categories established by the Schedule of Regulatory Fees in section 9
(g) of the Communications Act, 47 U.S.C. Sec. 159(g) as modified in the
instant NPRM. Where regulatory fee categories need interpretation or
clarification, we have relied on the legislative history of section 9,
our own experience in establishing and regulating the Schedule of
Regulatory Fees for Fiscal Years (FY) 1994, 1995, 1996, and 1997 and
the services subject to the fee schedule. The categories and amounts
set out in the schedule have been modified to reflect changes in the
number of payment units, additions and changes in the services subject
to the fee requirement and the benefits derived from the Commission's
regulatory activities, and to simplify the structure of the schedule.
The schedule may be similarly modified or adjusted in future years to
reflect changes in the Commission's budget and in the services
regulated by the Commission. See 47 U.S.C. 159(b)(2), (3).
2. Exemptions. Governments and nonprofit entities are exempt from
paying regulatory fees and should not submit payment. A nonprofit
entity may be asked to submit a current IRS Determination Letter
documenting that it is exempt from taxes under section 501 of the
Internal Revenue Code or the certification of a governmental authority
attesting to its nonprofit status. The governmental exemption applies
even where the government-owned or community-owned facility is in
competition with a commercial operation. Other specific exemptions are
discussed below in the descriptions of other particular service
categories.
[[Page 16210]]
1. Private Wireless Radio Services
3. Two levels of statutory fees were established for the Private
Wireless Radio Services--exclusive use services and shared use
services. Thus, licensees who generally receive a higher quality
communication channel due to exclusive or lightly shared frequency
assignments will pay a higher fee than those who share marginal quality
assignments. This dichotomy is consistent with the directive of section
9, that the regulatory fees reflect the benefits provided to the
licensees. See 47 U.S.C. Sec. 159(b)(1)(A). In addition, because of the
generally small amount of the fees assessed against Private Wireless
Radio Service licensees, applicants for new licenses and reinstatements
and for renewal of existing licenses are required to pay a regulatory
fee covering the entire license term, with only a percentage of all
licensees paying a regulatory fee in any one year. Applications for
modification or assignment of existing authorizations do not require
the payment of regulatory fees. The expiration date of those
authorizations will reflect only the unexpired term of the underlying
license rather than a new license term.
a. Exclusive Use Services
4. Private Mobile Radio Services (PMRS) (Formerly Land Mobile
Services): Regulatees in this category include those authorized under
part 90 of the Commission's Rules to provide limited access Wireless
Radio service that allows high quality voice or digital communications
between vehicles or to fixed stations to further the business
activities of the licensee. These services, using the 220-222 MHz band
and frequencies at 470 MHz and above, may be offered on a private
carrier basis in the Specialized Mobile Radio Services
(SMRS).115 For FY 1998, PMRS licensees will pay a $12 annual
regulatory fee per license, payable for an entire five or ten year
license term at the time of application for a new, renewal, or
reinstatement license.116 The total regulatory fee due is
either $60 for a license with a five year term or $120 for a license
with a 10 year term.
---------------------------------------------------------------------------
\115\ This category only applies to licensees of shared-use
private 220-222 MHz and 470 MHz and above in the Specialized Mobile
Radio (SMR) service who have elected not to change to the Commercial
Mobile Radio Service (CMRS). Those who have elected to change to the
CMRS are referred to paragraph 14 of this Attachment.
\116\ Although this fee category includes licenses with ten-year
terms, the estimated volume of ten-year license applications in FY
1998 is less than one-tenth of one percent and, therefore, is
statistically insignificant.
---------------------------------------------------------------------------
5. Microwave Services: These services include private and
commercial microwave systems and private and commercial carrier systems
authorized under part 101 of the Commission's Rules to provide
telecommunications services between fixed points on a high quality
channel of communications. Microwave systems are often used to relay
data and to control railroad, pipeline, and utility equipment.
Commercial systems typically are used for video or data transmission or
distribution. For FY 1998, Microwave licensees will pay a $12 annual
regulatory fee per license, payable for an entire ten year license term
at the time of application for a new, renewal, or reinstatement
license. The total regulatory fee due is $120 for the ten year license
term.
6. Interactive Video Data Service (IVDS): The IVDS is a two-way,
point-to-multi-point radio service allocated high quality channels of
communications and authorized under part 95 of the Commission's Rules.
The IVDS provides information, products, and services, and also the
capability to obtain responses from subscribers in a specific service
area. The IVDS is offered on a private carrier basis. The Commission
does not anticipate receiving any applications in the IVDS during FY
1998. Therefore, for FY 1998, there is no regulatory fee for IVDS
licensees.
b. Shared Use Services
7. Marine (Ship) Service: This service is a shipboard radio service
authorized under part 80 of the Commission's Rules to provide
telecommunications between watercraft or between watercraft and shore-
based stations. Radio installations are required by domestic and
international law for large passenger or cargo vessels. Radio equipment
may be voluntarily installed on smaller vessels, such as recreational
boats. The Telecommunications Act of 1996 gave the Commission the
authority to license certain ship stations by rule rather than by
individual license. The Commission exercises that authority. Thus,
private boat operators sailing entirely within domestic U.S. waters and
who are not otherwise required by treaty or agreement to carry a radio,
are no longer required to hold a marine license, and they will not be
required to pay a regulatory fee. For FY 1998, parties required to be
licensed and those choosing to be licensed for Marine (Ship) Stations
will pay a $6 annual regulatory fee per station, payable for an entire
ten-year license term at the time of application for a new, renewal, or
reinstatement license. The total regulatory fee due is $60 for the ten
year license term.
8. Marine (Coast) Service: This service includes land-based
stations in the maritime services, authorized under part 80 of the
Commission's Rules, to provide communications services to ships and
other watercraft in coastal and inland waterways. For FY 1998,
licensees of Marine (Coast) Stations will pay a $6 annual regulatory
fee per call sign, payable for the entire five-year license term at the
time of application for a new, renewal, or reinstatement license. The
total regulatory fee due is $30 per call sign for the five-year license
term.
9. Private Land Mobile (Other) Services: These services include
Land Mobile Radio Services operating under parts 90 and 95 of the
Commission's Rules. Services in this category provide one- or two-way
communications between vehicles, persons or fixed stations on a shared
basis and include radiolocation services, industrial radio services,
and land transportation radio services. For FY 1998, licensees of
services in this category will pay a $6 annual regulatory fee per call
sign, payable for an entire five-year license term at the time of
application for a new, renewal, or reinstatement license. The total
regulatory fee due is $30 for the five-year license term.
10. Aviation (Aircraft) Service: These services include stations
authorized to provide communications between aircraft and between
aircraft and ground stations and include frequencies used to
communicate with air traffic control facilities pursuant to part 87 of
the Commission's Rules. The Telecommunications Act of 1996 gave the
Commission the authority to license certain aircraft radio stations by
rule rather than by individual license. The commission exercises that
authority. Thus, private aircraft operators flying entirely within
domestic U.S. airspace and who are not otherwise required by treaty or
agreement to carry a radio are no longer required to hold an aircraft
license, and they will not be required to pay a regulatory fee. For FY
1998, parties required to be licensed and those choosing to be licensed
for Aviation (Aircraft) Stations will pay a $6 annual regulatory fee
per station, payable for the entire ten-year license term at the time
of application for a new, renewal, or reinstatement license. The total
regulatory fee due is $60 per station for the ten-year license term.
11. Aviation (Ground) Service: This service includes stations
authorized to provide ground-based communications to aircraft for
weather or landing information, or for logistical support pursuant to
part 87 of the Commission's Rules. Certain ground-based stations
[[Page 16211]]
which only serve itinerant traffic, i.e., possess no actual units on
which to assess a fee, are exempt from payment of regulatory fees. For
FY 1998, licensees of Aviation (Ground) Stations will pay a $6 annual
regulatory fee per license, payable for the entire five-year license
term at the time of application for a new, renewal, or reinstatement
license. The total regulatory fee is $30 per call sign for the five-
year license term.
12. General Mobile Radio Service (GMRS): These services include
Land Mobile Radio licensees providing personal and limited business
communications between vehicles or to fixed stations for short-range,
two-way communications pursuant to part 95 of the Commission's Rules.
For FY 1998, GMRS licensees will pay a $6 annual regulatory fee per
license, payable for an entire five-year license term at the time of
application for a new, renewal or reinstatement license. The total
regulatory fee due is $30 per license for the five-year license term.
c. Amateur Radio Vanity Call Signs
13. Amateur Vanity Call Signs: This category covers voluntary
requests for specific call signs in the Amateur Radio Service
authorized under part 97 of the Commission's Rules. Applicants for
Amateur Vanity Call-Signs will continue to pay a $5 annual regulatory
fee per call sign, as prescribed in the FY 1997 fee schedule, payable
for an entire ten-year license term at the time of application for a
vanity call sign until the FY 1998 fee schedule becomes effective. The
total regulatory fee due would be $50 per license for the ten-year
license term.117 For FY 1998, Amateur Vanity Call Sign
applicants will pay a $1.29 annual regulatory fee per call sign,
payable for an entire ten-year term at the time of application for a
new, renewal or reinstatement license. The total regulatory fee due is
$12.90 per call sign for the ten-year license term. We propose that
there will be no refunds to applicants who submit applications before
implementation of the FY 1998 fee.
---------------------------------------------------------------------------
\117\ Section 9(h) exempts ``amateur radio operator licenses
under part 97 of the Commission's rules (47 CFR part 97)'' from the
requirement. However, section 9(g)'s fee schedule explicitly
includes ``Amateur vanity call signs'' as a category subject to the
payment of a regulatory fee.
---------------------------------------------------------------------------
d. Commercial Wireless Radio Services
14. Commercial Mobile Radio Services (CMRS) Mobile Services: The
Commercial Mobile Radio Service (CMRS) is an ``umbrella'' descriptive
term attributed to various existing broadband services authorized to
provide interconnected mobile radio services for profit to the public,
or to such classes of eligible users as to be effectively available to
a substantial portion of the public. CMRS Mobile Services include
certain licensees which formerly were licensed as part of the Private
Radio Services (e.g., Specialized Mobile Radio Services) and others
formerly licensed as part of the Common Carrier Radio Services (e.g.,
Public Mobile Services and Cellular Radio Service). While specific
rules pertaining to each covered service remain in separate parts 22,
24, 80 and 90, general rules for CMRS are contained in part 20. CMRS
Mobile Services will include: Specialized Mobile Radio Services (part
90); 118 Broadband Personal Communications Services (part
24), Public Coast Stations (part 80); Public Mobile Radio (Cellular,
Rural Radio Service, 800 MHz Air-Ground Radiotelephone, and Offshore
Radio Services) (part 22); and Wireless Communications Service (part
27). Each licensee in this group will pay an annual regulatory fee for
each mobile or cellular unit (mobile or telephone number), assigned to
its customers, including resellers of its services. For FY 1998, the
regulatory fee is $.29 per unit.
---------------------------------------------------------------------------
\118\ This category does not include licensees of private
shared-use 220 MHz and 470 MHz and above in the Specialized Mobile
Radio (SMR) service who have elected to remain non-commercial. Those
who have elected not to change to the Commercial Mobile Radio
Service (CMRS) are referred to paragraph 4 of this Attachment.
---------------------------------------------------------------------------
15. Commercial Mobile Radio Services (CMRS) Messaging Services: The
Commercial Mobile Radio Service (CMRS) is an ``umbrella'' descriptive
term attributed to various existing narrowband services authorized to
provide interconnected mobile radio services for profit to the public,
or to such classes of eligible users as to be effectively available to
a substantial portion of the public. CMRS Messaging Services include
certain licensees which formerly were licensed as part of the Private
Radio Services (e.g., Private Paging and Radiotelephone Service),
licensees formerly licensed as part of the Common Carrier Radio
Services (e.g., Public Mobile One-Way Paging), licensees of Narrowband
Personal Communications Service (PCS) (e.g., one-way and two-way
paging), and 220-222 MHz Band and Interconnected Business Radio
Service. While specific rules pertaining to each covered service remain
in separate parts 22, 24 and 90, general rules for CMRS are contained
in part 20. Each licensee in the CMRS Messaging Services will pay an
annual regulatory fee for each unit (pager, telephone number, or
mobile) assigned to its customers, including resellers of its services.
For FY 1998, the regulatory fee is $.04 per unit.
16. Finally, we are reiterating our definition of CMRS payment
units to make it clear that fees are assessable on each PCS or cellular
telephone and each one-way or two-way pager capable of receiving or
transmitting information, whether or not the unit is ``active'' on the
``as-of'' date for payment of these fees. The unit becomes ``feeable''
if the end user or assignee of the unit has possession of the unit and
the unit is capable of transmitting or receiving voice or non-voice
messages or data and the unit is either owned and operated by the
licensee of the CMRS system or a reseller, or the end user of a unit
has a contractual agreement for the provision of a CMRS service from a
licensee of a CMRS system or a reseller of a CMRS service. The
responsible payer of the regulatory fee is the CMRS licensee. For
example, John Doe purchases a pager and contractually obtains paging
services from Paging Licensee X. Paging Licensee X is responsible for
paying the applicable regulatory fee for this unit. Likewise, Cellular
Licensee Y donates cellular phones to a high school and the high school
either pays for or obtains free cellular service from Cellular Licensee
Y. In this situation, Cellular Licensee Y is responsible for paying the
applicable regulatory fees for these units.
2. Mass Media Services
17. The regulatory fees for the Mass Media fee category apply to
broadcast licensees and permittees. Noncommercial Educational
Broadcasters are exempt from regulatory fees.
a. Commercial Radio
18. These categories include licensed Commercial AM (Classes A, B,
C, and D) and FM (Classes A, B, B1, C, C1, C2, and C3) Radio Stations
operating under part 73 of the Commission's Rules.119 We
have combined class of station and city grade contour population data
to formulate a schedule of radio fees which differentiate between
stations based on class of station and population served. In general,
higher class stations and stations in metropolitan areas will pay
higher fees than lower class stations and
[[Page 16212]]
stations located in rural areas. The specific fee that a station must
pay is determined by where it ranks after weighting its fee requirement
(determined by class of station) with its population. The regulatory
fee classifications for Radio Stations for FY 1998 are as follows:
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\119\ The Commission acknowledges that certain stations
operating in Puerto Rico and Guam have been assigned a higher level
station class than would be expected if the station were located on
the mainland. Although this results in a higher regulatory fee, we
believe that the increased interference protection associated with
the higher station class is necessary and justifies the fee.
Group 1........................................................ $2,500
Group 2........................................................ 2,250
Group 3........................................................ 2,000
Group 4........................................................ 1,750
Group 5........................................................ 1,500
Group 6........................................................ 1,250
Group 7........................................................ 1,000
Group 8........................................................ 750
Group 9........................................................ 500
Group 10....................................................... 250
19. Licensees may determine the appropriate fee payment by
referring to a list which will be provided as an attachment to the
final Report and Order in this proceeding. This same information will
be available on the FCC's internet world wide web site (http://
www.fcc.gov), by calling the FCC's National Call Center (1-888-225-
5322), and may be included in Public Notices mailed to each licensee.
b. Construction Permits--Commercial AM Radio
20. This category includes holders of permits to construct new
Commercial AM Stations. For FY 1998, permittees will pay a fee of $235
for each permit held. Upon issuance of an operating license, this fee
would no longer be applicable and licensees would be required to pay
the applicable fee for the designated group within which the station
appears.
c. Construction Permits--Commercial FM Radio
21. This category includes holders of permits to construct new
Commercial FM Stations. For FY 1998, permittees will pay a fee of
$1,150 for each permit held. Upon issuance of an operating license,
this fee would no longer be applicable. Instead, licensees would pay a
regulatory fee based upon the designated group within which the station
appears.
d. Commercial Television Stations
22. This category includes licensed Commercial VHF and UHF
Television Stations covered under part 73 of the Commission's Rules,
except commonly owned Television Satellite Stations, addressed
separately below. Markets are Nielsen Designated Market Areas (DMA) as
listed in the Television & Cable Factbook, Stations Volume No. 66, 1998
Edition, Warren Publishing, Inc. The fees for each category of station
are as follows:
VHF Markets 1-10.............................................. $41,275
VHF Markets 11-25............................................. 24,850
VHF Markets 26-50............................................. 22,600
VHF Markets 51-100............................................ 11,375
VHF Remaining Markets......................................... 3,250
UHF Markets 1-10.............................................. 14,625
UHF Markets 11-25............................................. 10,575
UHF Markets 26-50............................................. 5,750
UHF Markets 51-100............................................ 3,775
UHF Remaining Markets......................................... 1,500
e. Commercial Television Satellite Stations
23. Commonly owned Television Satellite Stations in any market
(authorized pursuant to Note 5 of Sec. 73.3555 of the Commission's
Rules) that retransmit programming of the primary station are assessed
a fee of $900 annually. Those stations designated as Television
Satellite Stations in the 1998 Edition of the Television and Cable
Factbook are subject to the fee applicable to Television Satellite
Stations. All other television licensees are subject to the regulatory
fee payment required for their class of station and market.
f. Construction Permits--Commercial VHF Television Stations
24. This category includes holders of permits to construct new
Commercial VHF Television Stations. For FY 1998, VHF permittees will
pay an annual regulatory fee of $4,100. Upon issuance of an operating
license, this fee would no longer be applicable. Instead, licensees
would pay a fee based upon the designated market of the station.
g. Construction Permits--Commercial UHF Television Stations
25. This category includes holders of permits to construct new UHF
Television Stations. For FY 1998, UHF Television permittees will pay an
annual regulatory fee of $3,625. Upon issuance of an operating license,
this fee would no longer be applicable. Instead, licensees would pay a
fee based upon the designated market of the station.
h. Construction Permits--Satellite Television Stations
26. The fee for UHF and VHF Television Satellite Station
construction permits for FY 1998 is $420. An individual regulatory fee
payment is to be made for each Television Satellite Station
construction permit held.
i. Low Power Television, FM Translator and Booster Stations, TV
Translator and Booster Stations
27. This category includes Low Power UHF/VHF Television stations
operating under part 74 of the Commission's Rules with a transmitter
power output limited to 1 kW for a UHF facility and, generally, 0.01 kW
for a VHF facility. Low Power Television (LPTV) stations may retransmit
the programs and signals of a TV Broadcast Station, originate
programming, and/or operate as a subscription service. This category
also includes translators and boosters operating under part 74 which
rebroadcast the signals of full service stations on a frequency
different from the parent station (translators) or on the same
frequency (boosters). The stations in this category are secondary to
full service stations in terms of frequency priority. We have also
received requests for waivers of the regulatory fees from operators of
community based Translators. These Translators are generally not
affiliated with commercial broadcasters, are nonprofit, nonprofitable,
or only marginally profitable, serve small rural communities, and are
supported financially by the residents of the communities served. We
are aware of the difficulties these Translators have in paying even
minimal regulatory fees, and we have addressed those concerns in the
ruling on reconsideration of the FY 1994 Report and Order. Community
based Translators are exempt from regulatory fees. For FY 1998,
licensees in low power television, FM translator and booster, and TV
translator and booster category will pay a regulatory fee of $265 for
each license held.
j. Broadcast Auxiliary Stations
28. This category includes licensees of remote pickup stations
(either base or mobile) and associated accessory equipment authorized
pursuant to a single license, Aural Broadcast Auxiliary Stations
(Studio Transmitter Link and Inter-City Relay) and Television Broadcast
Auxiliary Stations (TV Pickup, TV Studio Transmitter Link, TV Relay)
authorized under part 74 of the Commission's Rules. Auxiliary Stations
are generally associated with a particular television or radio
broadcast station or cable television system. This category does not
include translators and boosters (see paragraph 26 infra). For FY 1998,
licensees of Commercial Auxiliary Stations will pay an $11 annual
regulatory fee on a per call sign basis.
k. Multipoint Distribution Service
29. This category includes Multipoint Distribution Service (MDS),
and Multichannel Multipoint Distribution Service (MMDS), authorized
under part 21 of the Commission's Rules to use microwave frequencies
for video and data distribution within the United States. For FY 1998,
MDS and MMDS
[[Page 16213]]
stations will pay an annual regulatory fee of $260 per call sign.
3. Cable Services
a. Cable Television Systems
30. This category includes operators of Cable Television Systems,
providing or distributing programming or other services to subscribers
under part 76 of the Commission's Rules. For FY 1998, Cable Systems
will pay a regulatory fee of $.44 per subscriber.120
Payments for Cable Systems are to be made on a per subscriber basis as
of December 31, 1997. Cable Systems should determine their subscriber
numbers by calculating the number of single family dwellings, the
number of individual households in multiple dwelling units, e.g.,
apartments, condominiums, mobile home parks, etc., paying at the basic
subscriber rate, the number of bulk rate customers and the number of
courtesy or fee customers. In order to determine the number of bulk
rate subscribers, a system should divide its bulk rate charge by the
annual subscription rate for individual households. See FY 1994 Report
and Order, Appendix B at paragraph 31.
---------------------------------------------------------------------------
\120\ Cable systems are to pay their regulatory fees on a per
subscriber basis rather than per 1,000 subscribers as set forth in
the statutory fee schedule. See FY 1994 Report and Order at
paragraph 100.
---------------------------------------------------------------------------
b. Cable Antenna Relay Service
31. This category includes Cable Antenna Relay Service (CARS)
stations used to transmit television and related audio signals, signals
of AM and FM Broadcast Stations, and cablecasting from the point of
reception to a terminal point from where the signals are distributed to
the public by a Cable Television System. For FY 1998, licensees will
pay an annual regulatory fee of $50 per CARS license.
4. Common Carrier Services
a. Commercial Microwave (Domestic Public Fixed Radio Service)
32. This category includes licensees in the Point-to-Point
Microwave Radio Service, Local Television Transmission Radio Service,
and Digital Electronic Message Service, authorized under part 101 of
the Commission's Rules to use microwave frequencies for video and data
distribution within the United States. These services are now included
in the Microwave category (see paragraph 5 infra).
b. Interstate Telephone Service Providers
33. This category includes Inter-Exchange Carriers (IXCs), Local
Exchange Carriers (LECs), Competitive Access Providers (CAPs), domestic
and international carriers that provide operator services, Wide Area
Telephone Service (WATS), 800, 900, telex, telegraph, video, other
switched, interstate access, special access, and alternative access
services either by using their own facilities or by reselling
facilities and services of other carriers or telephone carrier holding
companies, and companies other than traditional local telephone
companies that provide interstate access services to long distance
carriers and other customers. This category also includes pre-paid
calling card providers. These common carriers, including resellers,
must submit fee payments based upon their proportionate share of gross
interstate revenues using the methodology that we have adopted for
calculating contributions to the TRS fund. See Telecommunications Relay
Services, 8 FCC Rcd 5300 (1993), 58 FR 39671 (July 26, 1993). In order
to avoid imposing any double payment burden on resellers, we will
permit carriers to subtract from their gross interstate revenues, as
reported to NECA in connection with their TRS contribution, any
payments made to underlying common carriers for telecommunications
facilities and services, including payments for interstate access
service, that are sold in the form of interstate service. For this
purpose, resold telecommunications facilities and services are only
intended to include payments that correspond to revenues that will be
included by another carrier reporting interstate revenue. For FY 1998,
carriers must multiply their adjusted gross revenue figure (gross
revenue reduced by the total amount of their payments to underlying
common carriers for telecommunications facilities or services) by the
factor 0.0011 to determine the appropriate fee for this category of
service. Regulatees may want to use the following worksheet to
determine their fee payment:
------------------------------------------------------------------------
Total Interstate
------------------------------------------------------------------------
(1) Revenue reported in TRS Fund worksheets...
(2) Less: Access charges paid.................
(3) Less: Other telecommunications facilities
and services taken for resale................
(4) Adjusted revenues (1) minus (2) minus (3).
(5) Fee factor................................ 0.0011
(6) Fee due (4)times(5).......................
------------------------------------------------------------------------
5. International Services
a. Earth Stations
34. Very Small Aperture Terminal (VSAT) Earth Stations, equivalent
C-Band Earth Stations and antennas, and earth station systems comprised
of very small aperture terminals operate in the 12 and 14 GHz bands and
provide a variety of communications services to other stations in the
network. VSAT systems consist of a network of technically-identical
small Fixed-Satellite Earth Stations which often include a larger hub
station. VSAT Earth Stations and C-Band Equivalent Earth Stations are
authorized pursuant to part 25 of the Commission's Rules. Mobile
Satellite Earth Stations, operating pursuant to part 25 of the
Commission's Rules under blanket licenses for mobile antennas
(transceivers), are smaller than one meter and provide voice or data
communications, including position location information for mobile
platforms such as cars, buses, or trucks. 121 Fixed-
Satellite Transmit/Receive and Transmit-Only Earth Station antennas,
authorized or registered under part 25 of the Commission's Rules, are
operated by private and public carriers to provide telephone,
television, data, and other forms of communications. Included in this
category are telemetry, tracking and control (TT&C) earth stations, and
earth station uplinks. For FY 1998, licensees of VSATs, Mobile
Satellite Earth Stations, and Fixed-Satellite Transmit/Receive and
Transmit-Only Earth Stations will pay a fee of $165 per authorization
or registration as well as a separate fee of $165 for each associated
Hub Station.
---------------------------------------------------------------------------
\121\ Mobile earth stations are hand-held or vehicle-based
units capable of operation while the operator or vehicle is in
motion. In contrast, transportable units are moved to a fixed
location and operate in a stationary (fixed) mode. Both are assessed
the same regulatory fee for FY 1998.
---------------------------------------------------------------------------
35. Receive-only earth stations. For FY 1998, there is no
regulatory fee for receive-only earth stations.
b. Space Stations (Geostationary Orbit)
36. Geostationary Orbit (also referred to as Geosynchronous) Space
Stations are domestic and international satellites positioned in orbit
to remain approximately fixed relative to the
[[Page 16214]]
earth. Most are authorized under part 25 of the Commission's Rules to
provide communications between satellites and earth stations on a
common carrier and/or private carrier basis. In addition, this category
includes Direct Broadcast Satellite (DBS) Service which includes space
stations authorized under part 100 of the Commission's rules to
transmit or re-transmit signals for direct reception by the general
public encompassing both individual and community reception. For FY
1998, entities authorized to operate geostationary space stations
(including DBS satellites) will be assessed an annual regulatory fee of
$119,000 per operational station in orbit. Payment is required for any
geostationary satellite that has been launched and tested and is
authorized to provide service.
c. Space Stations (Non-Geostationary Orbit)
37. Non-Geostationary Orbit Systems (such as Low Earth Orbit (LEO)
Systems) are space stations that orbit the earth in non-geosynchronous
orbit. They are authorized under part 25 of the Commission's rules to
provide communications between satellites and earth stations on a
common carrier and/or private carrier basis. For FY 1998, entities
authorized to operate Non-Geostationary Orbit Systems (NGSOs) will be
assessed an annual regulatory fee of $164,800 per operational system in
orbit. Payment is required for any NGSO System that has one or more
operational satellites operational. In our FY 1997 Report and Order at
paragraph 75 we retained our requirement that licensees of LEOs pay the
LEO regulatory fee upon their certification of operation of a single
satellite pursuant to section 25.120(d). We require payment of this fee
following commencement of operations of a system's first satellite to
insure that we recover our regulatory costs related to LEO systems from
licensees of these systems as early as possible so that other
regulatees are not burdened with these costs any longer than necessary.
Because section 25.120(d) has significant implications beyond
regulatory fees (such as whether the entire planned cluster is
operational in accordance with the terms and conditions of the license)
we are clarifying our current definition of an operational LEO
satellite to prevent misinterpretation of our intent as follows:
Licensees of Non-Geostationary Satellite Systems (such as LEOs) are
assessed a regulatory fee 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 25.120(d).
d. International Bearer Circuits
38. Regulatory fees for International Bearer Circuits are to be
paid by facilities-based common carriers (either domestic or
international) activating the circuit in any transmission facility for
the provision of service to an end user or resale carrier. Payment of
the fee for bearer circuits by non-common carrier submarine cable
operators is required for circuits sold on an indefeasible right of use
(IRU) basis or leased to any customer, including themselves or their
affiliates, other than an international common carrier authorized by
the Commission to provide U.S. international common carrier services.
Compare FY 1994 Report and Order at 5367. Payment of the international
bearer circuit fee is also required by non-common carrier satellite
operators for circuits sold or leased to any customer, including
themselves or their affiliates, other than an international common
carrier authorized by the Commission to provide U.S. international
common carrier services. The fee is based upon active 64 Kbps circuits,
or equivalent circuits.
Under this formulation, 64 Kbps circuits or their equivalent will
be assessed a fee. Equivalent circuits include the 64 Kbps circuit
equivalent of larger bit stream circuits. For example, the 64 Kbps
circuit equivalent of a 2.048 Mbps circuit is 30 64 Kbps circuits.
Analog circuits such as 3 and 4 KHz circuits used for international
service are also included as 64 Kbps circuits. However, circuits
derived from 64 Kbps circuits by the use of digital circuit
multiplication systems are not equivalent 64 Kbps circuits. Such
circuits are not subject to fees. Only the 64 Kbps circuit from which
they have been derived will be subject to payment of a fee. For FY
1998, the regulatory fee is $6.00 for each active 64 Kbps circuit or
equivalent. For analog television channels we will assess fees as
follows:
------------------------------------------------------------------------
No. of
equivalent
Analog television channel size in MHz 64 Kbps
circuits
------------------------------------------------------------------------
36......................................................... 630
24......................................................... 288
18......................................................... 240
------------------------------------------------------------------------
e. International Public Fixed
39. This fee category includes common carriers authorized under
part 23 of the Commission's Rules to provide radio communications
between the United States and a foreign point via microwave or HF
troposcatter systems, other than satellites and satellite earth
stations, but not including service between the United States and
Mexico and the United States and Canada using frequencies above 72 MHz.
For FY 1998, International Public Fixed Radio Service licensees will
pay a $375 annual regulatory fee per call sign.
f. International (HF) Broadcast
40. This category covers International Broadcast Stations licensed
under part 73 of the Commission's Rules to operate on frequencies in
the 5,950 KHz to 26,100 KHz range to provide service to the general
public in foreign countries. For FY 1998, International HF Broadcast
Stations will pay an annual regulatory fee of $475 per station license.
Attachment I--Description of FCC Activities
Authorization of Service: The authorization or licensing of radio
stations, telecommunications equipment, and radio operators, as well as
the authorization of common carrier and other services and facilities.
Includes policy direction, program development, legal services, and
executive direction, as well as support services associated with
authorization activities.122
---------------------------------------------------------------------------
\122\ Although Authorization of Service is described in this
exhibit, it is not one of the activities included as a feeable
activity for regulatory fee purposes pursuant to section 9(a)(1) of
the Act. 47 U.S.C. 159(a)(1).
---------------------------------------------------------------------------
Policy and Rulemaking: Formal inquiries, rulemaking proceedings to
establish or amend the Commission's rules and regulations, action on
petitions for rulemaking, and requests for rule interpretations or
waivers; economic studies and analyses; spectrum planning, modeling,
propagation-interference analyses, and allocation; and development of
equipment standards. Includes policy direction, program development,
legal services, and executive direction, as well as support services
associated with policy and rulemaking activities.
Enforcement: Enforcement of the Commission's rules, regulations and
authorizations, including investigations, inspections, compliance
monitoring, and sanctions of all types. Also includes the receipt and
disposition of formal and informal complaints regarding common carrier
rates and services, the review and acceptance/rejection of carrier
tariffs, and the review, prescription and audit of carrier accounting
practices. Includes policy
[[Page 16215]]
direction, program development, legal services, and executive
direction, as well as support services associated with enforcement
activities.
Public Information Services: The publication and dissemination of
Commission decisions and actions, and related activities; public
reference and library services; the duplication and dissemination of
Commission records and databases; the receipt and disposition of public
inquiries; consumer, small business, and public assistance; and public
affairs and media relations. Includes policy direction, program
development, legal services, and executive direction, as well as
support services associated with public information activities.
Attachment J--Factors, Measurements and Calculations That Go Into
Determining Station Signal Contours and Associated Population
Coverages
AM Stations
Specific information on each day tower, including field ratio,
phasing, spacing and orientation was retrieved, as well as the
theoretical pattern RMS figure (mV/m @ 1 km) for the antenna system.
The standard, or modified standard if pertinent, horizontal plane
radiation pattern was calculated using techniques and methods specified
in Secs. 73.150 and 73.152 of the Commission's rules. See 47 U.S.C.
73.150 and 73.152. Radiation values were calculated for each of 72
radials around the transmitter site (every 5 degrees of azimuth). Next,
estimated soil conductivity data was retrieved from a database
representing the information in FCC Figure M3. Using the calculated
horizontal radiation values, and the retrieved soil conductivity data,
the distance to the city grade (5 mV/m) contour was predicted for each
of the 72 radials. The resulting distance to city grade contours were
used to form a geographical polygon. Population counting was
accomplished by determining which 1990 block centroids were contained
in the polygon. The sum of the population figures for all enclosed
blocks represents the total population for the predicted city grade
coverage area.
FM Stations
The maximum of the horizontal and vertical HAAT (m) and ERP (kW)
was used. Where the antenna HAMSL was available, it was used in lieu of
the overall HAAT figure to calculate specific HAAT figures for each of
72 radials under study. Any available directional pattern information
was applied as well, to produce a radial-specific ERP figure. The HAAT
and ERP figures were used in conjunction with the propagation curves
specified in Sec. 73.313 of the Commission's rules to predict the
distance to the city grade (70 dBuV/m or 3.17 mV/m) contour for each of
the 72 radials. See 47 U.S.C. 73.313. The resulting distance to city
grade contours were used to form a geographical polygon. Population
counting was accomplished by determining which 1990 block centroids
were contained in the polygon. The sum of the population figures for
all enclosed blocks represents the total population for the predicted
city grade coverage area.
[FR Doc. 98-8459 Filed 4-1-98; 8:45 am]
BILLING CODE 6712-01-P
