2019-10922. Assessment and Collection of Regulatory Fees for Fiscal Year 2019  

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    AGENCY:

    Federal Communications Commission.

    ACTION:

    Proposed rule.

    SUMMARY:

    In this document, the Federal Communications Commission (Commission) proposes to revise its Schedule of Regulatory Fees to recover an amount of $339,000,000 that Congress has required the Commission to collect for fiscal year 2019.

    DATES:

    Submit comments on or before June 7, 2019; and reply comments on or before June 24, 2019.

    ADDRESSES:

    You may submit comments, identified by MD Docket No. 19-105, by any of the following methods:

    • Federal eRulemaking Portal: http://www.regulations.gov. Follow the instructions for submitting comments.
    • Federal Communications Commission's website: http://www.fcc.gov/​cgb/​ecfs. Follow the instructions for submitting comments.
    • People with Disabilities: Contact the FCC to request reasonable accommodations (accessible format documents, sign language interpreters, CART, etc.) by email: FCC504@fcc.gov or phone: 202-418-0530 or TTY: 202-418-0432.

    For detailed instructions for submitting comments and additional information on the rulemaking process, see the SUPPLEMENTARY INFORMATION section of this document.

    Start Further Info

    FOR FURTHER INFORMATION CONTACT:

    Roland Helvajian, Office of Managing Director at (202) 418-0444.

    End Further Info End Preamble Start Supplemental Information

    SUPPLEMENTARY INFORMATION:

    This is a summary of the Commission's Notice of Proposed Rulemaking (NPRM), MD Docket No. 19-105, FCC 19-37, adopted on May 7, 2019 and released on May 8, 2019. The full text of this document is available for inspection and copying during normal business hours in the FCC Reference Center, 445 12th Street SW, Room CY-A257, Portals II, Washington, DC 20554. This document is available in alternative formats (computer diskette, large print, audio record, and Braille). Persons with disabilities who need documents in these formats may contact the FCC by email: FCC504@fcc.gov or phone: 202-418-0530 or TTY: 202-418-0432.

    I. Procedural Matters

    A. Ex Parte Information

    1. This proceeding shall be treated as a “permit-but-disclose” proceeding in accordance with the Commission's ex parte rules.[1] Persons making ex parte presentations must file a copy of any written presentation or a memorandum summarizing any oral presentation within two business days after the presentation (unless a different deadline applicable to the Sunshine period applies). Persons making oral ex parte presentations are reminded that memoranda summarizing the presentation must (1) list all persons attending or otherwise participating in the meeting at which the ex parte presentation was made, and (2) summarize all data presented and arguments made during the presentation. If the presentation consisted in whole or in part of the presentation of data or arguments already reflected in the presenter's written comments, memoranda, or other filings in the proceeding, the presenter may provide citations to such data or arguments in his or her prior comments, memoranda, or other filings (specifying the relevant page and/or paragraph numbers where such data or arguments can be found) in lieu of summarizing them in the memorandum. Documents shown or given to Commission staff during ex parte meetings are deemed to be written ex parte presentations and must be filed consistent with § 1.1206(b) of the Commission's rules. In proceedings governed by § 1.49(f) of the Commission's rules or for which the Commission has made available a method of electronic filing, written ex parte presentations and memoranda summarizing oral ex parte presentations, and all attachments thereto, must be filed through the electronic comment filing system available for that proceeding, and must be filed in their native format (e.g., .doc, .xml, .ppt, searchable .pdf). Participants in this proceeding should familiarize themselves with the Commission's ex parte rules.

    B. Filing Instructions

    2. Pursuant to §§ 1.415 and 1.419 of the Commission's rules, 47 CFR 1.415, 1.419, interested parties may file comments and reply comments on or before the dates indicated on the first page of this document. Comments may be filed using the Commission's Electronic Comment Filing System (ECFS). See Electronic Filing of Documents in Rulemaking Proceedings, 63 FR 24121 (1998).

    • Electronic Filers: Comments may be filed electronically using the internet by accessing the ECFS: http://apps.fcc.gov/​ecfs/​.
    • Paper Filers: Parties who choose to file by paper must file an original and one copy of each filing. If more than one docket or rulemaking number appears in the caption of this proceeding, filers must submit two additional copies for each additional docket or rulemaking number.

    Filings can be sent by hand or messenger delivery, by commercial overnight courier, or by first-class or overnight U.S. Postal Service mail. All filings must be addressed to the Commission's Secretary, Office of the Secretary, Federal Communications Commission.

    • All hand-delivered or messenger-delivered paper filings for the Commission's Secretary must be delivered to FCC Headquarters at 445 12th St. SW, Room TW-A325, Washington, DC 20554. The filing hours are 8:00 a.m. to 7:00 p.m. All hand deliveries must be held together with rubber bands or fasteners. Any envelopes and boxes must be disposed of before entering the building.
    • Commercial overnight mail (other than U.S. Postal Service Express Mail and Priority Mail) must be sent to FCC, 9050 Junction Drive, Annapolis Junction, MD 20701.
    • U.S. Postal Service first-class, Express, and Priority mail must be addressed to 445 12th Street SW, Washington, DC 20554.

    3. People with Disabilities: To request materials in accessible formats for people with disabilities (braille, large print, electronic files, audio format), send an email to fcc504@fcc.gov or call the Consumer & Governmental Affairs Bureau at 202-418-0530 (voice), 202-418-0432 (tty).

    C. Initial Regulatory Flexibility Analysis

    4. An initial regulatory flexibility analysis (IRFA) is contained in this summary. Comments to the IRFA must be identified as responses to the IRFA and filed by the deadlines for comments on the Notice of Proposed Rulemaking. The Commission will send a copy of the Notice of Proposed Rulemaking, including the IRFA, to the Chief Counsel for Advocacy of the Small Business Administration.

    D. Initial Paperwork Reduction Act of 1995 Analysis

    5. This document does not contain new or modified information collection requirements subject to the Paperwork Start Printed Page 26235Reduction Act of 1995 (PRA), Public Law 104-13. In addition, therefore, it does not contain any new or modified information collection burden for small business concerns with fewer than 25 employees, pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4).

    II. Introduction

    6. In this Notice of Proposed Rulemaking (NPRM), we seek comment on the Commission's proposed regulatory fees for fiscal year (FY) 2019. Specifically, we propose to collect $339,000,000 in regulatory fees for FY 2019,[2] pursuant to sections 9 and 9A of the Communications Act of 1934, as amended (Act or Communications Act), and the Commission's FY 2019 Appropriation.[3] The proposed regulatory fee schedule for FY 2019 is set forth in Tables 2 and 3. For comparison purposes, the FY 2018 regulatory fee rates are listed in Table 7. In this NPRM, we also seek comment on modifications to the Commission's regulatory fee authority under the RAY BAUM'S Act of 2018.

    III. Background

    7. In 2018, as part of the RAY BAUM'S Act, Congress revised the Commission's regulatory fee authority by modifying section 9 and adding section 9A to the Communications Act.[4] In making such changes, Congress deleted outdated language from the statute, removed the now obsolete statutory schedule of regulatory fees originally adopted in 1993,[5] redirected the Commission on how to update regulatory fees, and revised and reformatted other provisions of the statute.[6] Congress directed the Commission to complete a regulatory fee rulemaking under the modified statute by October 2019.[7]

    8. Congress established the Commission's regulatory fee authority in 1993 when Congress adopted a statutory schedule of regulatory fees and charged the Commission with updating and amending the schedule pursuant to statutory guidance on an annual basis.[8] The Commission discharged its statutory obligation by (1) adopting regulatory fee rules [9] and descriptions of each fee category listed in the statute [10] and (2) annually making adjustments to the fee schedule through a notice and comment rulemaking proceeding.[11] Such annual reviews of the fee schedule proposed revisions to the schedule to reflect changes in the amount of the Commission's appropriation and other changes based upon the criteria included in section 9 of the Communications Act.

    9. Since 1993, the Commission has made numerous changes to the schedule. In making such changes, the Commission used the statutory criterion that the fee reflect the benefits provided to the payor of the fee and factors reasonably related to that criterion. For example, in the FY 2013 Report and Order, the Commission updated the full-time equivalents (FTE) [12] allocations to more accurately reflect the number of FTEs working on regulation and oversight of regulatees in the fee categories.[13] The Commission has since updated the FTE allocations annually. Other recent examples include the FY 2015 NPRM, where the Commission adopted a regulatory fee category for Direct Broadcast Satellite (DBS), as a subcategory of the cable television and IPTV fee category.[14] In explaining the change, the Commission described both the change in the service and the Commission's regulation thereof in the decades since adoption of the original fee schedule and how DBS providers benefited from the work of Media Bureau FTEs on multichannel video programming distributors (MVPDs).[15] And in the FY 2016 Report and Order, the Commission adjusted regulatory fees for radio and television broadcasters, based on the type and class of service and on the population served.[16] The Commission has also made other improvements to its regulatory fee analysis as part of its annual review. For example, in the FY 2017 Report and Order, the Commission included non-common carrier terrestrial international bearer circuits in the regulatory fee methodology and increased the de minimis threshold to $1,000 for annual regulatory fee payors.[17]

    IV. Discussion

    10. In this NPRM, we (1) explain and seek comment on the RAY BAUM'S Act modifications to the Commission's regulatory fee authority; (2) propose and seek comment on a schedule, as set forth in Tables 2 and 3, of FY 2019 regulatory fees, which are due in September 2019; and (3) propose and seek comment on granular aspects of the regulatory fee calculation for DBS Start Printed Page 26236providers, full-power broadcast television, and international bearer circuits. Finally, we reaffirm and restate certain rules that are fundamental to the enforcement and collection aspects of the Commission's regulatory fee regime.

    A. RAY BAUM'S Act Modifications to the Commission's Regulatory Fee Authority

    11. Although aspects of section 9 of the Communications Act have been modified by the RAY BAUM'S Act, the Commission's core responsibilities under the statute remain unchanged. The Commission remains charged with ensuring that regulatory fees will result in collections of amounts that can reasonably be expected to equal amounts appropriated by Congress for each fiscal year.[18]

    12. In the RAY BAUM'S Act modifications, Congress deleted the obsolete schedule of regulatory fees codified in the former section 9(g) of the Act [19] and directed the Commission to establish a new schedule of regulatory fees and to provide annual updates thereafter.[20] In plain terms, Congress directed the Commission to establish a new schedule of regulatory fees by amending “the schedule of regulatory fees established under this section if the Commission determines that the schedule requires amendment so that such fees reflect the full-time equivalent number of employees within the bureaus and offices of the Commission, adjusted to take into account factors that are reasonably related to the benefits provided to the payor of the fee by the Commission's activities.” [21] Each year thereafter, the Commission is required to adjust the schedule of regulatory fees established under this section to “(A) reflect unexpected increases or decreases in the number of units subject to the payment of such fees; and (B) result in the collection of the amount required” by the Commission's annual appropriation.[22] In such annual regulatory fee adjustments, the Commission may make further amendments to the schedule if the Commission determines that the statutory criteria are satisfied.

    13. The scheme as articulated under the RAY BAUM'S Act is closely aligned to how the Commission implemented its authority under the prior version of section 9 of the Communications Act. Under both old and new versions of the statute, the Commission is charged with assessing and collecting regulatory fees that will result in collections of amounts that can reasonably be expected to equal amounts appropriated by Congress for each fiscal year.[23] Again, under both old and new versions of the statute, regulatory fees are initially apportioned across fee categories based on the number of FTEs and adjusted “to take into account factors that are reasonably related to the benefits provided to the payor of the fee by the Commission's activities.” [24] Not surprisingly, the Commission's consideration of changes, additions, or deletions to its fee schedule since 1993 have been focused on the FTE burdens related to the regulatory fee category at issue. As exercised, the Commission's fee determinations have been carefully considered.[25] Thus, in this NPRM we are proposing to hew closely to our prior annual process for adjusting and amending fee categories and the fee schedule. We seek comment on this proposal.

    14. Certain language was, however, deleted from section 9 in the RAY BAUM'S Act. First, the prior statute identified three bureaus that have since been renamed.[26] Second, the prior statute included a list of examples of factors relevant to the Commission's inquiry into benefits provided the payor of the fee; those examples were “service area coverage, shared use versus exclusive use, and other factors that the Commission determines are necessary in the public interest.” [27] Third, while both versions of the statute require the Commission to take into consideration in its annual review unexpected increases or decreases in the “number of units” subject to the payment of regulatory fees, the prior statute specifically mentioned licensees.[28] Finally, under the prior version of section 9, in amending the schedule of regulatory fees, the Commission could take into consideration “additions, deletions, or changes in the nature of its services as a consequence of Commission rulemaking proceedings or changes in law.” [29] The old version of the statute described the annual changes as either mandatory amendments [30] or permitted amendments; [31] under the RAY BAUM'S Act, the changes are described as adjustments [32] or amendments.[33] We seek comment on how these deletions and changes impact the Commission's responsibilities in assessing and collecting regulatory fees. Commenters should discuss any effect on the Commission's proposed regulatory fee methodology due to deletion of language or the reformulation of the requirements under section 9.[34]

    15. We remind commenters of certain unvarying aspects of the Commission's assessment and collection of regulatory fees that they should take into consideration when making comments on our proposals. Regulatory fees, mandated by Congress, are collected to recover the Commission's costs “to the extent, and in the total amounts, provided for in Appropriation Acts.” [35] Thus, the Commission has no discretion regarding the total amount to be collected in any given fiscal year. Regulatory fees are to reflect “the full-time equivalent number of employees Start Printed Page 26237within the bureaus and offices of the Commission, adjusted to take into account factors that are reasonably related to the benefits provided to the payor of the fee by the Commission's activities.” [36] Thus the calculation and allocation of FTEs across regulatory fee categories is, by statute, at the heart of the Commission's methodology in calculating regulatory fees. Regulatory fees recover the Commission's direct costs—that is, costs attributable to a specific regulatory activity (e.g., the salaries and benefits of Commission employees that work on the oversight and regulation of local exchange carriers). Regulatory fees also recover indirect costs, i.e., common costs that are not attributable to a specific regulatory activity. These costs are for general overhead, administration, and support, such as rent, utilities, salaries, and benefits of information technology and other employees whose work supports the core bureaus, and general-purpose equipment.[37] Regulatory fees also cover the costs incurred in regulating entities that are statutorily exempt from paying regulatory fees [38] and entities whose regulatory fees are waived.[39] We also remind commenters that FTE time devoted to developing and implementing the Commission's spectrum auctions is not included in the calculation of regulatory fees and is not offset by the collection of regulatory fees. Instead, such FTE time is offset by the auction proceeds that the Commission is permitted to retain pursuant to section 309(j)(8)(B) [40] of the Communications Act and the Commission's annual appropriation.[41]

    B. Allocating FTEs Across Categories for FY 2019

    16. Applying the section 9 requirements to calculate regulatory fees, we propose to allocate the total collection target across all regulatory fee categories. We propose that for FY 2019 the allocation of fees to fee categories will be based on the Commission's calculation of FTEs in each regulatory fee category. Our proposed methodology is generally consistent with that employed in FY 2018. As a general matter, we reasonably expect that the work of the FTEs in the four “core” bureaus (i.e., Wireline Competition Bureau, Wireless Telecommunications Bureau, International Bureau, and Media Bureau) [42] will remain focused on the industry segment regulated by each of those bureaus. The work of the FTEs in the indirect bureaus and offices benefits the Commission and the telecommunications industry and is not specifically focused on the regulatees and licensees of a core bureau. The total FTEs for each fee category includes the direct FTEs associated with that category, plus a proportional allocation of indirect FTEs.[43]

    17. Historically, the Commission allocates the total amount to be collected among the various regulatory fee categories within each of the core bureaus. Each regulatee within a fee category then pays its proportionate share based on an objective measure of size (e.g., revenues or number of subscribers).[44] We propose that non-auctions FTEs will be classified as “direct” if the employee is in one of the four core bureaus; otherwise, the FTEs will be classified as “indirect.” [45] We propose that each regulatee within a fee category pays its proportionate share based on an objective measure (e.g., revenues or number of subscribers). Our proposed calculations are illustrated in Table 1. The sources for the unit estimates that are used in these calculations are listed in Table 4.

    18. We propose to allocate the total amount to be collected among the regulatory fee categories within each of the core bureaus and base the FY 2019 FTE allocations on a percentage that proportionally reflects the changes in FTEs in the core bureaus over the course of FY 2019.[46] We project approximately $25.39 million (7.49% of the total FTE allocation) in fees from International Bureau regulatees; $85.15 million (25.12% of the total FTE allocation) in fees from Wireless Telecommunications Bureau regulatees; $106.64 million (31.46% of the total FTE allocation) from Wireline Competition Bureau regulatees; and $121.82 million (35.93% of the total FTE allocation) from Media Bureau regulatees. We seek comment on our calculation for the FY 2019 FTEs.

    19. The above allocations across the core bureaus are further allocated across the regulatory fee categories within each core bureau to reflect FTE use. The specific fee proposals and the specific Start Printed Page 26238mechanism for calculating them can be viewed in Tables 1, 2, 3, 4, and 5. Presented as a percentage of each bureau's allocation, our FY 2019 regulatory fee proposals can be viewed as follows: The International Bureau regulatory fees allocated across International Bureau services: Bearer Circuits (3.76%), Submarine Cable (24.85%), GSO Space Stations (61.61%), NGSO Space Stations (4.27%), and Earth Stations (5.51%); the Wireless Telecommunications Bureau regulatory fees allocated across Wireless services: CMRS (Cell and Messaging) (87.67%), BRS/LMDS (1.14%), and Multi-Year Wireless regulatory fees (11.19%); the Wireline Competition Bureau regulatory fees allocated across Wireline services: ITSP as 100% with the Toll Free Number regulatory fee subcategory as 12 cents per toll free number (which can be viewed as 3.71% of the total Wireline Competitive Bureau allocation this year); and the Media Bureau regulatory fees allocated across media services: Broadcast Radio Station fees (24.52%), Television (20.48%), and Cable TV Systems (including IPTV) and DBS (55%).

    20. The Commission first provided full descriptions of the regulatory fee categories in the 1994 Report and Order.[47] These categories have changed over time through rulemaking and Table 6 contains an enumeration of the regulatory fee categories the Commission used to assess regulatory fees for FY 2018. We propose to use the same categories for FY 2019 and seek comment on each fee category in Table 6.

    C. Direct Broadcast Satellite (DBS) Regulatory Fees

    21. DBS service is a nationally distributed subscription service that delivers video and audio programming via satellite to a small parabolic dish antenna at the subscriber's location. The two DBS providers, AT&T and DISH Network, are MVPDs.[48] The Media Bureau oversees the regulation of MVPDs, i.e., regulated companies that make available for purchase, by subscribers or customers, multiple channels of video programming. The Media Bureau relies on a common pool of FTEs to carry out its oversight of MVPDs and other video distribution providers.[49] These responsibilities include market modifications, local-into-local, must-carry and retransmission consent disputes, program carriage and program access complaints, over-the-air reception device declaratory rulings and waivers, media rule modernization, media ownership, and proposed transactions.[50]

    22. For Media Bureau activities in FY 2019, the Commission must collect $67.02 million in regulatory fees from cable TV systems, IPTV providers, and DBS operators. Based on our prior regulatory fee decisions, the Commission proposes to assess cable TV systems and IPTV providers at the same rate for regulatory fee purposes—with the total fee due being based on subscribership. The Commission has previously taken a different approach when it adopted Media Bureau-based regulatory fees on DBS operators. Specifically, in FY 2015, the Commission decided to phase in the new Media Bureau-based regulatory fee for DBS, starting at 12 cents per subscriber per year, as a subcategory in the cable television and IPTV category.[51] At the same time, the Commission committed to updating the regulatory fee rate in future years “as necessary for ensuring an appropriate level of regulatory parity and considering the resources dedicated to this new regulatory fee subcategory.” [52] Accordingly, the Commission increased the regulatory fee for DBS operators to 24 cents and then 36 cents per subscriber per year, with the regulatory fees paid by DBS operators reducing those paid by other MVPDs.[53] For FY 2018, the Commission continued the transition by increasing the DBS regulatory fee rate to 48 cents per subscriber per year.[54] The Commission explained that the DBS regulatory fee is based on the significant number of Media Bureau FTEs that work on MVPD issues that include DBS, “not a particular number of FTEs focused solely on DBS” or “specific recent proceedings.” [55]

    23. The Commission previously concluded that the continued participation of DBS operators in Commission proceedings, and the use of a pool of Media Bureau FTEs to oversee MVPD issues, justifies increasing the DBS regulatory fee rate.[56] We seek comment on whether Media Bureau resources working on MVPD proceedings, including DBS, support continuing to phase in the DBS regulatory fee rate to bring it closer to the cable television/IPTV rate, which, for FY 2019, is proposed to be 86 cents per subscriber, per year. We recognize that DBS is not identical to cable television and IPTV; however, services that are not technologically identical nevertheless can warrant placement in the same regulatory fee category, e.g., the ITSP category includes a range of carriers that are not regulated identically.[57] Cable television, IPTV, and DBS all receive oversight and regulation by Media Bureau FTEs working on MVPD issues.[58]

    24. We propose to continue the phase in and set a DBS regulatory fee rate of 60 cents per subscriber per year, a 12-cent increase from the rate we used in FY 2018. In doing so, we invite comment concerning whether this continued “phase in” is still permissible under the RAY BAUM'S Act and whether this continued “phase in” is still good policy. In the alternative, we seek comment on including DBS fully in the cable television/IPTV rate, which would then be approximately 77 cents per subscriber per year, or adopting a different rate for DBS.Start Printed Page 26239

    D. Broadcast Television Stations

    25. Historically, regulatory fees for full-power television stations were based on the Nielsen Designated Market Area (DMA) groupings 1-10, 11-25, 26-50, 51-100, and remaining markets (DMAs 101-210). In the FY 2018 NPRM, we sought comment on whether using the actual population covered by the station's contours instead of using DMAs would more accurately reflect the actual market served by a full-power broadcast television station for purposes of assessing regulatory fees.[59] We proposed this change in methodology, which was consistent with the methodology used for AM and FM broadcasters and would better “take into account factors that are reasonably related to the benefits provided to the payor of the fee by the Commission's activities.” [60] We sought comment on whether, for FY 2019 and going forward, regulatory fees should be assessed for full-power broadcast television stations based on the actual population covered by the station's contour, instead of DMAs.[61] We also sought comment on whether to phase in the implementation of this methodology.[62]

    26. In the FY 2018 Report and Order, we adopted the proposed methodology and stated that in order to facilitate the transition to this new fee structure, for FY 2019, we planned to adopt a fee based on an average of the historical DMA methodology and the population covered by a full-power broadcast station's contour for FY 2019.[63] The RAY BAUM'S Act instructs the Commission, when considering its annual review, to “take into account factors that are reasonably related to the benefits provided to the payor of the fee by the Commission's activities.” [64] Because the standard considered when adopting the proposed methodology for establishing full-power television station regulatory fees and the related transition in the FY 2018 Report and Order parallels the RAY BAUM'S Act standard, we tentatively conclude that the new methodology adopted last year is consistent with the RAY BAUM'S Act. Accordingly, consistent with our FY 2018 analysis, we propose FY 2019 fees for full-power broadcast television stations based on an average of the DMA methodology and the population covered by a full-power broadcast television station's contour. We also propose adopting a factor of .72 of one cent ($.007224) for FY 2019 full-power broadcast television station fees.[65] As in the FY 2018 Report and Order, the population data for broadcasters' service areas is extracted from the TVStudy database, based on a station's projected noise-limited service contour.[66] Table 3 lists this population data for each licensee. Table 3 also lists the DMA-based fee, the population-based fee (population multiplied by $.007224), and the resulting proposed regulatory fee for FY 2019 (i.e., the average of the DMA-based fee and population-based fee) for each full-power broadcast television station, including each satellite station. We seek comment on these proposed fees.[67]

    E. Terrestrial and Satellite International Bearer Circuits (IBCs)

    27. The Commission previously sought comment on adopting a tiered methodology for assessing terrestrial and satellite international bearer circuit regulatory fees.[68] For FY 2018, the Commission assessed terrestrial and satellite common carrier and non-common carrier IBC regulatory fees on a per-circuit basis, using Gbps as the measurement rather than 64 kbps and stated in the FY 2018 NPRM that it expected to have sufficient circuit information from payors in September 2018 to consider a tiered rate structure for FY 2019.[69]

    28. Now that we have FY 2018 circuit information for common carrier and non-common carrier terrestrial circuits, we believe that we should not move to a tiered structure for assessing IBC regulatory fees. Due to the wide range of numbers of circuits among carriers, particularly between the satellite and the terrestrial carriers—a tiered system, such as the two-tiered system previously proposed by CenturyLink,[70] would result in large increases in fees for the smaller carriers that do not appear to be “reasonably related to the benefits provided to the payor of the fee[ ] by the Commission's activities,” as required by section 9(d) of the Act.[71] More specifically, FY 2019 IBC fees that would be assessed on the 13 carriers currently in this fee category using the existing per-Gbps methodology would range from approximately $121 all the way to $355,000 per carrier, and condensing such a large range of fees to two tiers would require a substantial fee increase for the smaller carriers. To avoid such increases, we believe that we would need to adopt a complex tiering system of at least seven tiers, and several of these tiers would apply to only one carrier. We believe that such a complex tiered system would not be an improvement over the current methodology. Accordingly, we propose to continue to base non-common carrier and common carrier satellite and terrestrial IBC fees on the per Gbps rate in Table 2, which would be $121 for FY 2019. We seek comment on this proposal.

    29. To the extent that commenters nevertheless believe that we should adopt a tiered structure for assessing IBC regulatory fees, we seek comment on what that structure should look like. For example, notwithstanding the concerns discussed above, should we adopt the following seven-tiered system, and if so, why?

    • Systems with capacities less than 5 Gbps would pay a flat $150 fee.
    • Systems with capacities equal to 5 Gbps or greater, but less than 50 Gbps, would pay a flat $750 fee.
    • Systems with capacities equal to 50 Gbps or greater, but less than 250 Gbps, would pay a flat $11,200 fee.
    • Systems with capacities equal to 250 Gbps or greater, but less than 750 Gbps, would pay a flat $45,000 fee.
    • Systems with capacities equal to 750 Gbps or greater, but less than 1,200 Gbps, would pay a flat $135,000 fee.Start Printed Page 26240
    • Systems with capacities equal to 1,200 Gbps or greater, but less than 2,500 Gbps, would pay a flat $270,000 fee.
    • Systems with capacities equal to or greater than 2,500 Gbps would pay a flat $345,000 fee.

    30. For any tiered structure proposed, commenters should explain why their proposal would be an improvement over the current methodology and how the resulting fees would be “reasonably related to the benefits provided to the payor of the fee[ ] by the Commission's activities.” [72]

    F. De Minimis Regulatory Fees

    31. Section 9(e)(2) of the RAY BAUM'S Act provides the Commission with discretion to exempt a party from paying regulatory fees when the Commission determines that the cost of collection exceeds the amount collected.[73] Specifically, section 9(e)(2) provides that the Commission may exempt a party from paying regulatory fees if “in the judgment of the Commission, the cost of collecting a regulatory fee established under this section from a party would exceed the amount collected from such party. . . .” [74] Below, we seek comment on how to implement section 9(e)(2).

    32. Since 1996, the Commission has provided a de minimis threshold for regulatory fee payments by exempting a regulatee from paying regulatory fees if the sum total of all of its annual regulatory fee liabilities was less than the threshold for a given fiscal year. In adopting the first de minimis threshold for regulatory fees of $10.00, the Commission found that the cost of processing small payments resulted in a net loss to the U.S. Department of the Treasury.[75] The Commission subsequently revised the de minimis threshold in 2014 to $500.00 based in part on the costs of assessing and collecting regulatory fees from non-payers.[76] The Commission estimated that the cost of collection of an unpaid regulatory fee was at least $350.00.[77] The Commission explained that the increase in the de minimis threshold to $500.00 would provide financial relief to small entities and reduce the administrative burden on the Commission that would result from attempting to collect unpaid fees.[78] The Commission noted that smaller entities are at greater risk of missing regulatory fee deadlines and that many such entities are subject to little Commission oversight and regulation.[79] The Commission increased the de minimis threshold to $1,000.00 in 2017, observing that the cost of researching and creating a bill to send to a non-payor, and completing follow-up discussion and correspondence, had increased since the FY 2014 regulatory fee proceeding.[80] The Commission further found that the $350.00 estimate of collection costs in the FY 2014 Report and Order did not include the Commission's overhead costs.[81]

    33. We view new section 9(e)(2) as codifying our authority to adopt a de minimis exemption. Section 9(e)(2) provides the Commission with discretion to exempt a “party” and to provide relief based on the cost of collection, both of which were factors considered in the existing de minimis exemption. The adoption of a monetary threshold applied against the total amount due in a given fiscal year continues to be, in our estimation, an efficient mechanism for reducing the Commission's costs in assessing and collecting regulatory fees.

    34. We have analyzed an average cost of collection of a delinquent bill today and estimate that the cost to the Commission would exceed $1,000.00. For delinquent bills, the Commission's administrative process includes various functions such as gathering data from the bureaus and external sources (e.g., the Universal Service Administrative Company (USAC)); validating data and preparing the data for billing; validating outstanding bills; preparing delinquency bills for transfer to collection agent for processing; discussing bills with regulatees when they call with questions; addressing bill disputes (e.g., Centralized Receivable Service (CRS), U.S. Department of the Treasury, and FCC Help Desks); and processing payments received from CRS and U.S. Department of the Treasury. We thus seek comment on a section 9(e)(2) annual regulatory fee de minimis exemption of $1,000.00.

    35. We also propose to exclude multi-year regulatory fees from the proposed section 9(e)(2) exemption. Historically, the de minimis threshold has applied only to annual regulatory fee filers and did not include regulatory fees paid through multi-year filings. The Commission excluded multi-year wireless fees from the de minimis exemption because the process of paying multi-year regulatory fees is a separate process from annual regulatory fee filings, and including multi-year fees in the threshold would significantly increase the Commission's administrative costs.[82] Section 9(e)(2) provides the Commission with discretion as to whether and how to provide this exemption; specifically, it states that the Commission “may exempt” a party from paying regulatory fees. We propose to exclude multi-year licenses from the new section 9(e)(2) exemption due to the administrative costs associated with implementing such an exemption for these fees. We seek comment on this proposal.

    G. Additional Regulatory Fee Reform

    36. We also seek comment on additional regulatory fee reform and ways to further improve our regulatory fee process to make it less burdensome for all entities. In particular, we seek comment on whether our fee setting methodologies could be improved or updated to ensure that our regulatory fees are more equitable or otherwise streamlined to make the fee schedule simpler. As part of this analysis, we seek comment on the costs and benefits of reforming our fee-setting process.

    H. Restatement of Certain Rules Fundamental to Waiver, Enforcement and Collection of Regulatory Fees

    37. The RAY BAUM'S Act moved and reformatted certain provisions of prior section 9 relating to waiver, enforcement and collection of regulatory fees.[83] Because these provisions are Start Printed Page 26241essential to the Commission's exercise of its statutory authority here, we take this opportunity to explain essential aspects of the statute and also note that our application of these provisions remains unchanged.

    1. Waiver, Reduction and Deferral of Regulatory Fees

    38. Section 9A of the Communications Act, as amended by the RAY BAUM'S Act, permits the Commission to waive, reduce, or defer payment of a regulatory fee and associated interest charges and penalties for good cause if the waiver, reduction, or deferral (collectively, waiver or waive) would serve the public interest.[84] The Commission interprets this provision narrowly to permit only those waivers “unambiguously articulating `extraordinary circumstances' outweighing the public interest in recouping the cost of the Commission's regulatory services for a particular regulatee.” [85] Within this standard, the Commission recognizes that in exceptional circumstances, financial hardship may justify waiving and/or deferring a party's regulatory fees.[86] Financial inability, however, must be conclusively proven and the burden of proof for doing so lies solely with the regulatee seeking relief. Mere allegations of financial loss will not support a waiver request. Rather, as the Commission has stated, “it is incumbent upon each regulatee to fully document its financial position and show that it lacks sufficient funds to pay the regulatory fees and to maintain its service to the public.” [87] The Commission has suggested that documents that may be relevant to prove financial inability include balance sheets and profit and loss statements (audited if available), twelve month cash flow projections (with an explanation of how calculated), a list of officers and highest paid employees other than officers, and each individual's compensation, or similar information.[88] We emphasize, however, that the foregoing list of documents is not exhaustive and it is up to each regulatee to determine the documentation required to prove financial hardship in its own case.

    39. The Commission has previously stated that with respect to waiver, reduction, and deferral requests based on financial hardship, the Commission will base its decision on the information submitted with the request as well as “any additional information available in the Commission's records.” [89] We are not bound, nor is it an efficient use of the Commission's time, to search our records for information or documents that might be relevant to a request for waiver, reduction or deferral of a regulatory fee. Therefore, we propose to eliminate consideration of information and documents available in our records and instead, require that any party seeking regulatory fee relief, regardless of the basis for its request, must include with its request all documents and information the requestor believes to be relevant to prove its case, regardless of whether or not such documentation or information exists in Commission records.[90]

    40. The Commission frequently receives requests to waive regulatory fees owed by regulatees in bankruptcy or receivership, who cite the fact of the bankruptcy or receivership as proof of the regulatee's financial hardship, justifying waiver. Here we wish to emphasize the standard to which the Commission hews in determining whether to grant relief in such cases. While the Commission recognizes that the fact of a bankruptcy or receivership filing may be sufficient evidence of financial hardship, we consider such cases individually,[91] taking into account a number of other factors that are relevant to the question of whether the regulatee lacks sufficient funds to pay the regulatory fees and to maintain its service to the public. Although the factors we consider are case-specific, they might include for example, whether the regulatee intends to reorganize or liquidate in bankruptcy, the reason for the bankruptcy or receivership filing, the regulatee's ability or plan to obtain post-petition financing, the number, type and amount of other claims asserted against the regulatee in the bankruptcy or receivership case, and the priority accorded under bankruptcy or receivership law to the Commission's regulatory fee claim.

    41. We also remind regulatees that requests to waive their regulatory fees must be properly filed by the date on which such fees are due.[92]

    2. Enforcement

    42. Late payment penalty and interest. Regulatory fee payments must be paid by their due date. Section 9A(c)(1) of the Act requires the Commission to impose a late payment penalty of 25 percent of unpaid regulatory fee debt, to be assessed on the first day following the deadline for payment of the fees. Section 9A(c)(2) of the Act requires the Commission to assess interest at the rate set forth in 31 U.S.C. 3717 on all unpaid regulatory fees, including the 25 percent penalty, until the debt is paid in full.[93] The RAY BAUM'S Act, however, prohibits the Commission from assessing the administrative costs of collecting delinquent regulatory fee debt.[94] Thus, while section 9A(c) of the Act leaves intact those parts of § 1.1940 of the Commission's rules pertaining to penalty and interest charges, the Commission will no longer assess administrative costs on delinquent regulatory fee debts.[95]

    43. Collection and offset. The Commission will pursue collection of all past due regulatory fees, including penalties and accrued interest, using collection remedies available to it under the Debt Collection Improvement Act of 1996, its implementing regulations and federal common law. These remedies include offsetting regulatory fee debt against monies owed to the debtor by the Commission, and referral of the debt to the United States Treasury for further collection efforts, including centralized offset against monies other federal agencies may owe the debtor.[96]

    44. Red light. Failure to timely pay regulatory fees, penalties or accrued interest will also subject regulatees to the Commission's “red light” rule, which generally requires the Commission to withhold action on and subsequently dismiss applications and other requests for benefits by any entity owing debt, including regulatory fee debt, to the Commission.[97]

    45. Revocation. In addition to financial penalties, section 9(c)(3) of the Start Printed Page 26242Act,[98] and § 1.1164(f) of the Commission's rules [99] grant the Commission the authority to revoke authorizations for failure to pay regulatory fees in a timely fashion. Should a fee delinquency not be rectified in a timely manner the Commission may require the licensee to file with documented evidence within sixty (60) calendar days that full payment of all outstanding regulatory fees has been made, plus any associated penalties as calculated by the Secretary of Treasury in accordance with § 1.1164(a) of the Commission's rules,[100] or show cause why the payment is inapplicable or should be waived or deferred. Failure to provide such evidence of payment or to show cause within the time specified may result in revocation of the station license.[101]

    V. Procedural Matters

    46. Included below are procedural items as well as our current payment and collection methods. We include these payments and collection procedures here as a useful way of reminding regulatory fee payers and the public about these aspects of the annual regulatory fee collection process.

    A. Payment of Regulatory Fees

    47. Credit Card Transaction Levels. Since June 1, 2015, in accordance with U.S. Treasury Announcement No. A-2014-04 (July 2014), the highest amount that can be charged on a credit card for transactions with federal agencies is $24,999.99.[102] Transactions greater than $24,999.99 will be rejected. This limit applies to single payments or bundled payments of more than one bill. Multiple transactions to a single agency in one day may be aggregated and treated as a single transaction subject to the $24,999.99 limit. Customers who wish to pay an amount greater than $24,999.99 should consider available electronic alternatives such as Visa or MasterCard debit cards, ACH debits from a bank account, and wire transfers. Each of these payment options is available after filing regulatory fee information in Fee Filer. Further details will be provided regarding payment methods and procedures at the time of FY 2019 regulatory fee collection in Fact Sheets, https://www.fcc.gov/​regfees.

    48. Payment Methods. Pursuant to an Office of Management and Budget (OMB) directive,[103] the Commission is moving towards a paperless environment, extending to disbursement and collection of select federal government payments and receipts.[104] In 2015, the Commission stopped accepting checks (including cashier's checks and money orders) and the accompanying hardcopy forms (e.g., Forms 159, 159-B, 159-E, 159-W) for the payment of regulatory fees.[105] During the fee season for collecting regulatory fees, regulatees can pay their fees by credit card through Pay.gov,[106] ACH, debit card,[107] or by wire transfer. Additional payment instructions are posted on the Commission's website at http://transition.fcc.gov/​fees/​regfees.html. The receiving bank for all wire payments is the U.S. Treasury, New York, NY (TREAS NYC). Any other form of payment (e.g., checks, cashier's checks, or money orders) will be rejected. For payments by wire, a Form 159-E should still be transmitted via fax so that the Commission can associate the wire payment with the correct regulatory fee information. The fax should be sent to the Federal Communications Commission at (202) 418-2843 at least one hour before initiating the wire transfer (but on the same business day) so as not to delay crediting their account. Regulatees should discuss arrangements (including bank closing schedules) with their bankers several days before they plan to make the wire transfer to allow sufficient time for the transfer to be initiated and completed before the deadline. Complete instructions for making wire payments are posted at http://transition.fcc.gov/​fees/​wiretran.html.

    49. Standard Fee Calculations and Payment Dates.—The Commission will accept fee payments made in advance of the window for the payment of regulatory fees. The responsibility for payment of fees by service category is as follows:

    • Media Services: Regulatory fees must be paid for initial construction permits that were granted on or before October 1, 2018 for AM/FM radio stations, VHF/UHF broadcast television stations, and satellite television stations. Regulatory fees must be paid for all broadcast facility licenses granted on or before October 1, 2018.
    • Wireline (Common Carrier) Services: Regulatory fees must be paid for authorizations that were granted on or before October 1, 2018. In instances where a permit or license is transferred or assigned after October 1, 2018, responsibility for payment rests with the holder of the permit or license as of the fee due date. Audio bridging service providers are included in this category.[108] For Responsible Organizations (RespOrgs) that manage Toll Free Numbers (TFN), regulatory fees should be paid on all working, assigned, and reserved toll free numbers as well as toll free numbers in any other status as defined in § 52.103 of the Commission's rules.[109] The unit count should be based on toll free numbers managed by RespOrgs on or about December 31, 2018.
    • Wireless Services: CMRS cellular, mobile, and messaging services (fees based on number of subscribers or telephone number count): Regulatory fees must be paid for authorizations that were granted on or before October 1, 2018. The number of subscribers, units, or telephone numbers on December 31, 2018 will be used as the basis from which to calculate the fee payment. In instances where a permit or license is transferred or assigned after October 1, 2018, responsibility for payment rests with the holder of the permit or license as of the fee due date.
    • Wireless Services, Multi-year fees: The first eight regulatory fee categories in our Schedule of Regulatory Fees pay “small multi-year wireless regulatory fees.” Entities pay these regulatory fees in advance for the entire amount period covered by the five-year or ten-year terms of their initial licenses, and pay regulatory fees again only when the license is renewed or a new license is Start Printed Page 26243obtained. We include these fee categories in our rulemaking to publicize our estimates of the number of “small multi-year wireless” licenses that will be renewed or newly obtained in FY 2019.
    • Multichannel Video Programming Distributor Services (cable television operators, CARS licensees, DBS, and IPTV): Regulatory fees must be paid for the number of basic cable television subscribers as of December 31, 2018.[110] Regulatory fees also must be paid for CARS licenses that were granted on or before October 1, 2018. In instances where a permit or license is transferred or assigned after October 1, 2018, responsibility for payment rests with the holder of the permit or license as of the fee due date. For providers of DBS service and IPTV-based MVPDs, regulatory fees should be paid based on a subscriber count on or about December 31, 2018. In instances where a permit or license is transferred or assigned after October 1, 2018, responsibility for payment rests with the holder of the permit or license as of the fee due date.
    • International Services: Regulatory fees must be paid for (1) earth stations and (2) geostationary orbit space stations and non-geostationary orbit satellite systems that were licensed and operational on or before October 1, 2018. In instances where a permit or license is transferred or assigned after October 1, 2018, responsibility for payment rests with the holder of the permit or license as of the fee due date.
    • International Services (Submarine Cable Systems): Regulatory fees for submarine cable systems are to be paid on a per cable landing license basis based on circuit capacity as of December 31, 2018. In instances where a license is transferred or assigned after October 1, 2018, responsibility for payment rests with the holder of the license as of the fee due date. For regulatory fee purposes, the allocation in FY 2019 will remain at 87.6 percent for submarine cable and 12.4 percent for satellite/terrestrial facilities.
    • International Services (Terrestrial and Satellite Services): Regulatory fees for terrestrial and satellite IBCs are to be paid based on active (used or leased) international bearer circuits as of December 31, 2018 in any terrestrial or satellite transmission facility for the provision of service to an end user or resale carrier. When calculating the number of such active circuits, entities must include circuits used by themselves or their affiliates. For these purposes, “active circuits” include backup and redundant circuits as of December 31, 2018. Whether circuits are used specifically for voice or data is not relevant for purposes of determining that they are active circuits.[111] In instances where a permit or license is transferred or assigned after October 1, 2018, responsibility for payment rests with the holder of the permit or license as of the fee due date. For regulatory fee purposes, the IBC allocation in FY 2019 will remain at 87.6 percent for submarine cable and 12.4 percent for satellite/terrestrial facilities.

    B. Commercial Mobile Radio Service (CMRS) and Mobile Services Assessments

    50. The Commission will compile data from the Numbering Resource Utilization Forecast (NRUF) report that is based on “assigned” telephone number (subscriber) counts that have been adjusted for porting to net Type 0 ports (“in” and “out”).[112] This information of telephone numbers (subscriber count) will be posted on the Commission's electronic filing and payment system (Fee Filer) along with the carrier's Operating Company Numbers (OCNs).

    51. A carrier wishing to revise its telephone number (subscriber) count can do so by accessing Fee Filer and follow the prompts to revise their telephone number counts. Any revisions to the telephone number counts should be accompanied by an explanation or supporting documentation.[113] The Commission will then review the revised count and supporting documentation and either approve or disapprove the submission in Fee Filer. If the submission is disapproved, the Commission will contact the provider to afford the provider an opportunity to discuss its revised subscriber count and/or provide additional supporting documentation. If we receive no response from the provider, or we do not reverse our initial disapproval of the provider's revised count submission, the fee payment must be based on the number of subscribers listed initially in Fee Filer. Once the timeframe for revision has passed, the telephone number counts are final and are the basis upon which CMRS regulatory fees are to be paid. Providers can view their final telephone counts online in Fee Filer. A final CMRS assessment letter will not be mailed out.

    52. Because some carriers do not file the NRUF report, they may not see their telephone number counts in Fee Filer. In these instances, the carriers should compute their fee payment using the standard methodology that is currently in place for CMRS Wireless services (i.e., compute their telephone number counts as of December 31, 2018), and submit their fee payment accordingly. Whether a carrier reviews its telephone number counts in Fee Filer or not, the Commission reserves the right to audit the number of telephone numbers for which regulatory fees are paid. In the event that the Commission determines that the number of telephone numbers that are paid is inaccurate, the Commission will bill the carrier for the difference between what was paid and what should have been paid.

    VI. Tables

    Regulatory fees for the first seven fee categories below shaded are collected by the Commission in advance to cover the term of the license and are submitted at the time the application is filed.

    Table 1—Calculation of FY 2019 Revenue Requirements and Pro-Rata Fees

    Fee categoryFY 2019 payment unitsYrsFY 2018 revenue estimatePro-rated FY 2019 revenue requirementComputed FY 2019 regulatory feeRounded FY 2019 reg. feeExpected FY 2019 revenue
    PLMRS (Exclusive Use)45010$85,000$112,500$25.00$25$112,500
    Start Printed Page 26244
    PLMRS (Shared use)12,400101,250,0001,239,99910.00101,240,000
    Microwave10,000101,937,5002,500,00025.00252,500,000
    Marine (Ship)7,100101,072,5001,065,00015.00151,065,000
    Aviation (Aircraft)4,50010400,000450,00010.0010450,000
    Marine (Coast)601030,00024,00040.004024,000
    Aviation (Ground)1,10010200,000220,00020.0020220,000
    AM Class A 1611266,175285,6284,6824,675285,175
    AM Class B 11,38913,274,4503,543,9842,5512,5503,541,950
    AM Class C 177311,177,2001,268,9091,6421,6501,275,450
    AM Class D 11,25613,907,8004,192,0653,3383,3504,207,600
    FM Classes A, B1 & C3 12,90418,152,4508,809,9703,0383,0258,784,600
    FM Classes B, C, C0, C1 & C2 13,075110,009,60010,794,5783,5103,50010,762,500
    AM Construction Permits 2314,9501,9806606601,980
    FM Construction Permits 2671105,18577,0501,1501,15077,050
    Satellite TV1251189,000202,8471,6231,625203,125
    Digital TV Mkt 1-1014317,164,0007,722,29354,00254,0007,722,000
    Digital TV Mkt 11-2514015,243,0005,693,04740,66540,6755,694,500
    Digital TV Mkt 26-5018614,729,7255,052,12627,16227,1505,049,900
    Digital TV Mkt 51-10029113,617,7503,939,71713,53913,5503,943,050
    Digital TV Remaining Markets37511,594,9001,668,9914,4514,4501,668,750
    Digital TV Construction Permits 23112,30013,3504,4504,45013,350
    LPTV/Translators/Boosters/Class A TV4,10011,515,8201,622,772345.33451,621,500
    CARS Stations1751188,125201,0181,2181,225202,125
    Cable TV Systems, including IPTV57,000,000146,970,00048,767,045.8556.8649,020,000
    Direct Broadcast Satellite (DBS)30,000,000115,360,00018,011,242.6004.6018,000,000
    Interstate Telecommunication Service Providers$32,200,000,0001100,686,000102,695,1890.0031890.00319102,718,000
    Toll Free Numbers33,000,00013,320,0003,954,2110.11980.123,960,000
    CMRS Mobile Services (Cellular/Public Mobile)421,000,000180,800,00078,424,2170.18630.1979,990,000
    CMRS Messag. Services1,900,000180,000152,0000.08000.080152,000
    BRS/ 31,2601705,000869,400690690869,400
    LMDS1401240,00096,60069069096,600
    Per Gbps circuit Int'l Bearer Circuits—Terrestrial (Common & Non-Common) & Satellite (Common & Non-Common)7,4401685,102900,785121.073121900,240
    Submarine Cable Providers (See chart at bottom of Table 2) 438.0014,959,0356,363,608167,463167,4756,364,050
    Earth Stations3,30011,105,0001,399,0504244251,402,500
    Space Stations (Geostationary)98112,401,45015,643,457159,627159,62515,643,250
    Space Stations (Non-Geostationary)71859,4251,084,200154,886154,8751,084,125
    ****** Total Estimated Revenue to be Collected324,365,671339,062,828340,866,270
    ****** Total Revenue Requirement322,035,000339,000,000339,000,000
    Difference2,330,67162,8281,866,270
    Notes on Table 1:
    1 The fee amounts listed in the column entitled “Rounded New FY 2019 Regulatory Fee” constitute a weighted average broadcast regulatory fee by class of service. The actual FY 2019 regulatory fees for AM/FM radio station are listed on a grid located at the end of Table 2.
    2 The AM and FM Construction Permit revenues and the Digital (VHF/UHF) Construction Permit revenues were adjusted, respectively, to set the regulatory fee to an amount no higher than the lowest licensed fee for that class of service. Reductions in the Digital (VHF/UHF) Construction Permit revenues, and in the AM and FM Construction Permit revenues, were offset by increases in the revenue totals for Digital television stations by market size, and in the AM and FM radio stations by class size and population served, respectively.
    3 MDS/MMDS category was renamed Broadband Radio Service (BRS). See Amendment of Parts 1, 21, 73, 74 and 101 of the Commission's Rules to Facilitate the Provision of Fixed and Mobile Broadband Access, Educational and Other Advanced Services in the 2150-2162 and 2500-2690 MHz Bands, Report & Order and Further Notice of Proposed Rulemaking, 19 FCC Rcd 14165, 14169, paragraph 6 (2004).
    4 The chart at the end of Table 2 lists the submarine cable bearer circuit regulatory fees (common and non-common carrier basis) that resulted from the adoption of the Assessment and Collection of Regulatory Fees for Fiscal Year 2008, Report and Order and Further Notice of Proposed Rulemaking, 24 FCC Rcd 6388 (2008) and Assessment and Collection of Regulatory Fees for Fiscal Year 2008, Second Report and Order, 24 FCC Rcd 4208 (2009).

    Regulatory fees for the first eight fee categories below are collected by the Commission in advance to cover the term of the license and are submitted at the time the application is filed.

    Table 2—Proposed Regulatory Fees for FY 2019

    Fee categoryAnnual regulatory fee (U.S. $'s)
    PLMRS (per license) (Exclusive Use) (47 CFR part 90)25
    Microwave (per license) (47 CFR part 101)25
    Marine (Ship) (per station) (47 CFR part 80)15
    Marine (Coast) (per license) (47 CFR part 80)40
    Rural Radio (47 CFR part 22) (previously listed under the Land Mobile category)10
    PLMRS (Shared Use) (per license) (47 CFR part 90)10
    Aviation (Aircraft) (per station) (47 CFR part 87)10
    Start Printed Page 26245
    Aviation (Ground) (per license) (47 CFR part 87)20
    CMRS Mobile/Cellular Services (per unit) (47 CFR parts 20, 22, 24, 27, 80 and 90).19
    CMRS Messaging Services (per unit) (47 CFR parts 20, 22, 24 and 90).08
    Broadband Radio Service (formerly MMDS/MDS) (per license) (47 CFR part 27)690
    Local Multipoint Distribution Service (per call sign) (47 CFR, part 101)690
    AM Radio Construction Permits660
    FM Radio Construction Permits1,150
    AM and FM Broadcast Radio Station FeesSee Table Below
    Digital TV (47 CFR part 73) VHF and UHF Commercial(*)
    Construction Permits4,450
    Low Power TV, Class A TV, TV/FM Translators & Boosters (47 CFR part 74)345
    CARS (47 CFR part 78)1,225
    Cable Television Systems (per subscriber) (47 CFR part 76), Including IPTV.86
    Direct Broadcast Service (DBS) (per subscriber) (as defined by section 602(13) of the Act).60
    Interstate Telecommunication Service Providers (per revenue dollar).00319
    Toll Free (per toll free subscriber) (47 C.F.R. 52.101 (f) of the rules).12
    Earth Stations (47 CFR part 25)425
    Space Stations (per operational station in geostationary orbit) (47 CFR part 25) also includes DBS Service (per operational station) (47 CFR part 100)159,625
    Space Stations (per operational system in non-geostationary orbit) (47 CFR part 25)154,875
    International Bearer Circuits—Terrestrial/Satellites (per Gbps circuit)121
    Submarine Cable Landing Licenses Fee (per cable system)See Table Below
    (*) See Table 3; also available at https://www.fcc.gov/​licensing-databases/​fees/​regulatory-fees.

    Proposed FY 2019 Radio Station Regulatory Fees

    Population servedAM Class AAM Class BAM Class CAM Class DFM Classes A, B1 & C3FM Classes B, C, C0, C1 & C2
    <= 25,000$1,000$760$660$725$1,150$1,325
    25,001-75,0001,5751,1509901,0001,7252,000
    75,001-150,0002,3751,7001,4751,6252,6002,975
    150,001-500,0003,5502,5752,2252,4503,8754,475
    500,001-1,200,0005,3253,8503,3503,6755,8256,700
    1,200,001-3,000,0007,9755,7755,0255,5008,75010,075
    3,000,001-6,000,00011,9508,6507,5258,25013,10015,100
    >6,000,00017,95013,00011,27512,40019,65022,650

    FY 2019 International Bearer Circuits—Submarine Cable Systems

    Submarine cable systems (capacity as of December 31, 2018)Proposed fee amount for FY 2019
    Less than 50 Gbps$12,575
    50 Gbps or greater, but less than 250 Gbps25,150
    250 Gbps or greater, but less than 1,000 Gbps50,300
    1,000 Gbps or greater, but less than 4,000 Gbps100,600
    4,000 Gbps or greater201,225

    Table 31—FY 2019 Full-Power Broadcast Television Regulatory Fees by Call Sign

    Call signPopulationPopulation based feeDMA based feeBlended: 1/2 Pop. fee 1/2 DMA fee
    KAAL52,021$376$4,450$2,413
    KAAS-TV220,2621,59113,5507,571
    KABB2,474,29617,87527,15022,513
    KABC-TV17,791,505128,53254,00091,266
    KABY-TV137,3319924,4502,721
    KAUT-TV1,608,47611,62027,15019,385
    KAUZ-TV381,6712,7574,4503,604
    KAVU-TV320,4842,3154,4503,383
    KAWE136,03398340,67520,829
    KAYU-TV809,4645,84813,5509,699
    KADN-TV877,9656,3434,4505,396
    Start Printed Page 26246
    KAEF-TV138,0859984,4502,724
    KAII-TV188,8101,36413,5507,457
    KAIL1,967,74414,21613,55013,883
    KAIT861,1496,2214,4505,336
    KAJB383,8862,7734,4503,612
    KAKE803,9375,80813,5509,679
    KAKW-DT2,615,95618,89927,15023,024
    KALB-TV943,3076,8154,4505,632
    KALO948,6836,85413,55010,202
    KAZD6,747,91548,7494,45026,600
    KAZQ1,097,0107,92527,15017,538
    KAZT-TV436,9253,15740,67521,916
    KBAK-TV1,510,40010,9124,4507,681
    KBCA463,0753,3454,4503,898
    KBCB1,256,1939,07540,67524,875
    KBCW8,020,42457,94354,00055,971
    KBFD-DT953,2076,88613,55010,218
    KBIM-TV205,7011,48627,15014,318
    KBJR-TV275,5851,9914,4503,220
    KAMC391,5262,8294,4503,639
    KAME-TV611,9814,4214,4504,436
    KAMR-TV366,4762,6484,4503,549
    KAPP319,7972,3104,4503,380
    KARD703,2345,0804,4504,765
    KARE3,924,94428,35540,67534,515
    KARK-TV1,212,0388,75613,55011,153
    KARZ-TV1,186,5798,57213,55011,061
    KASA-TV1,161,7898,39327,15017,772
    KASN1,117,4038,07313,55010,811
    KBLN-TV297,3842,1484,4503,299
    KBLR1,964,97914,19627,15020,673
    KBMT743,0095,3684,4504,909
    KBMY119,9938674,4502,658
    KBOI-TV716,7545,1784,4504,814
    KBRR149,8691,0834,4502,766
    KBSD-DT155,0121,12013,5507,335
    KBSH-DT102,78174313,5507,146
    KBSI752,3665,43513,5509,493
    KBSL-DT49,81436013,5506,955
    KASW4,170,50530,12940,67535,402
    KASY-TV1,140,9168,24227,15017,696
    KATC1,348,8979,7454,4507,097
    KATN97,4667044,4502,577
    KATU2,978,04321,51440,67531,095
    KATV1,257,7779,08713,55011,318
    KCBD414,8042,9974,4503,723
    KDKA-TV3,611,79626,09340,67533,384
    KDKF71,4135164,4502,483
    KDLH263,4221,9034,4503,177
    KBSV1,352,1669,76940,67525,222
    KBTV-TV734,0085,3034,4504,876
    KBTX-TV4,048,51629,24813,55021,399
    KBVO1,498,01510,82227,15018,986
    KBVU135,2499774,4502,714
    KBZK116,4858424,4502,646
    KCAL-TV17,734,310128,11954,00091,060
    KCAU-TV783,6555,6614,4505,056
    KCBA3,094,77822,3584,45013,404
    KCBS-TV17,595,935127,12054,00090,560
    KDLO-TV208,3541,5054,4502,978
    KDLT-TV645,3914,6634,4504,556
    KDLV-TV96,8737004,4502,575
    KDMD374,9512,7094,4503,579
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    Start Printed Page 26247
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    Start Printed Page 26248
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    Start Printed Page 26249
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    Start Printed Page 26250
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    Start Printed Page 26251
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    Start Printed Page 26252
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    Start Printed Page 26253
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    Start Printed Page 26254
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    Start Printed Page 26255
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    Start Printed Page 26256
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    Start Printed Page 26257
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    Start Printed Page 26258
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    Start Printed Page 26261
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    Start Printed Page 26262
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    Start Printed Page 26263
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    Start Printed Page 26264
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    WXII-TV3,434,63724,81327,15025,982
    WXIN2,721,63919,66227,15023,406
    WXIX-TV2,825,57020,41327,15023,781
    WXLV-TV4,362,76131,51827,15029,334
    WXMI191,1071,38127,15014,265
    WXOW425,3783,0734,4503,762
    WXPX-TV4,566,03732,98740,67536,831
    WWSI11,012,27979,55754,00066,778
    WWTI196,5311,4204,4502,935
    WWTV1,034,1747,4714,4505,961
    WXCW1,749,84712,64213,55013,096
    WXIA-TV6,179,68044,64454,00049,322
    WYOU3,553,76125,67413,55019,612
    WYOW91,2336594,4502,555
    WYPX-TV1,167,9758,43813,55010,994
    WYTV2,068,93514,9474,4509,698
    WYZZ-TV1,042,1407,5294,4505,989
    WXTX700,1235,0584,4504,754
    WXXA-TV1,775,66712,82813,55013,189
    WXXV-TV1,178,2518,5124,4506,481
    WXYZ-TV5,591,43440,39540,67540,535
    WYDC393,8432,8454,4503,648
    WYDO1,097,7457,93113,55010,740
    WYFF2,586,88818,68927,15022,919
    WYMT-TV1,180,2768,52713,55011,038
    WZBJ1,606,84411,60813,55012,579
    WZDX1,557,49011,25213,55012,401
    WZMQ73,4235304,4502,490
    WZPX-TV2,094,02915,12827,15021,139
    WZRB952,2796,88013,55010,215
    WZTV2,311,14316,69727,15021,923
    WZVI55,8044034,4502,427
    WZVN-TV1,916,09813,84313,55013,696
    WZZM1,574,54611,37527,15019,263
    1 Table 3 is also available as a spreadsheet on the Commission's website at https://www.fcc.gov/​licensing-databases/​fees/​regulatory-fees,, including the Facility Identification number and DMA for each call sign.

    Table 3 Continued—Additional Call Signs Not Included Previously in Appendix C

    Call signPopulationPopulation based feeDMA based feeBlended 1/2 Pop. fee & 1/2 DMA fee
    KAZA-TV11,151,141$80,560$54,000$67,280
    KBEH17,343,236125,29454,00089,647
    KEMO-TV5,097,70136,82854,00045,414
    KHSL-TV627,2564,5324,4504,491
    KOFY-TV5,097,70136,82854,00045,414
    KPNX4,216,95030,46540,67535,570
    KSMS-TV1,251,0459,0384,4506,744
    KTLN-TV5,209,08737,63254,00045,816
    KTNC-TV8,048,42758,14554,00056,072
    KXLN-DT6,078,07143,91054,00048,955
    WBMM577,6534,1734,4504,312
    WCWG3,434,63724,81327,15025,982
    WDCW8,155,99858,92254,00056,461
    WGGN-TV1,991,46214,38740,67527,531
    WGGS-TV2,163,32115,62913,55014,589
    Start Printed Page 26265
    WJAL8,970,52664,80654,00059,403
    WLLA2,041,93414,75227,15020,951
    WLOO917,9986,63213,55010,091
    WLVI7,319,65952,88054,00053,440
    WLWC3,281,53223,70713,55018,628
    WMLW-TV1,822,29713,16527,15020,157
    WPMT2,412,56117,42927,15022,290
    WSPA-TV3,393,07224,51313,55019,031
    WTCV3,254,48123,5124,45013,981
    WTVE4,027,24829,09454,00041,547
    WUAB3,821,23327,60640,67534,140
    WUTB8,509,75761,47827,15044,314
    WUVN1,132,4458,18127,15017,666
    WUVP-DT10,421,21675,28754,00064,643
    WWJE-DT7,209,57152,08554,00053,042
    WXBU3,046,41822,00827,15024,579
    WXFT-DT10,174,46473,50454,00063,752
    WXTV-DT19,992,096144,43054,00099,215
    WYCI34,16924713,5506,898
    WYCW3,393,07224,51313,55019,031
    WZME5,996,40843,32054,00048,660

    In order to calculate individual service fees for FY 2019, we adjusted FY 2018 payment units for each service to more accurately reflect expected FY 2019 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. The databases we consulted include our Universal Licensing System (ULS), International Bureau Filing System (IBFS), Consolidated Database System (CDBS) and Cable Operations and Licensing System (COALS), as well as reports generated within the Commission such as the Wireless Telecommunications Bureau's Numbering Resource Utilization Forecast.

    We sought verification for these estimates from multiple sources and, in all cases, we compared FY 2019 estimates with actual FY 2018 payment units to ensure that our revised estimates were reasonable. Where appropriate, 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 with sufficient accuracy. These include an unknown number of waivers and/or exemptions that may occur in FY 2019 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. When we note, for example, that our estimated FY 2019 payment units are based on FY 2018 actual payment units, it does not necessarily mean that our FY 2019 projection is exactly the same number as in FY 2018. We have either rounded the FY 2019 number or adjusted it slightly to account for these variables.

    Table 4—Sources of Payment Unit Estimates for FY 2019

    Fee categorySources of payment unit estimates
    Land Mobile (All), Microwave, Marine (Ship & Coast), Aviation (Aircraft & Ground), Domestic Public Fixed (Units are Licenses)Based on Wireless Telecommunications Bureau (WTB) projections of new applications and renewals taking into consideration existing 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 Cellular/Mobile Services (Units are Subscribers or Telephone #s)Based on WTB projection reports, and FY 2018 payment data.
    CMRS Messaging Services (Units are Subscribers or Telephone #s)Based on WTB reports, and FY 2018 payment data.
    AM/FM Radio Stations (Units are Licensed Stations)Based on CDBS data, adjusted for exemptions, and actual FY 2018 payment units.
    Digital TV Stations (Combined VHF/UHF units) (Units are Licensed Stations)Based on CDBS data, adjusted for exemptions, and actual FY 2018 payment units.
    AM/FM/TV Construction Permits (Units are Holders of Permits)Based on CDBS data, adjusted for exemptions, and actual FY 2018 payment units.
    LPTV, Translators and Boosters, Class A Television (Units are Licensed Stations or Facilities)Based on CDBS data, adjusted for exemptions, and actual FY 2018 payment units.
    BRS (formerly MDS/MMDS)Based on WTB reports and actual FY 2018 payment units.
    LMDS (Units are Holders of Licenses)Based on WTB reports and actual FY 2018 payment units.
    Cable Television Relay Service (CARS) Stations (Units are Holders of Licenses)Based on data from Media Bureau's COALS database and actual FY 2018 payment units.
    Cable Television System Subscribers, Including IPTV Subscribers (Units are Subscribers)Based on publicly available data sources for estimated subscriber counts and actual FY 2018 payment units.
    Start Printed Page 26266
    Interstate Telecommunication Service Providers (Units are Revenues)Based on FCC Form 499-Q data for the four quarters of calendar year 2018, the Wireline Competition Bureau projected the amount of calendar year 2018 revenue that will be reported on 2018 FCC Form 499-A worksheets due in April 2019.
    Earth Stations (Units are Licensed Earth Stations)Based on International Bureau (“IB”) licensing data and actual FY 2018 payment units.
    Space Stations (GSOs & NGSOs) (Units are Licensed and Operational Satellites)Based on IB data reports and actual FY 2018 payment units.
    International Bearer Circuits (Units are Gbps Circuits)Based on IB reports and submissions by licensees, adjusted as necessary.
    Submarine Cable Licenses (Units are Submarine Cable Systems)Based on IB license information.

    Table 5

    Factors, Measurements, and Calculations That Determine Station Signal Contours and Associated Population Coverages

    AM Stations

    For stations with nondirectional daytime antennas, the theoretical radiation was used at all azimuths. For stations with directional daytime antennas, specific information on each day tower, including field ratio, phase, spacing, and orientation was retrieved, as well as the theoretical pattern root-mean-square of the radiation in all directions in the horizontal plane (RMS) figure (milliVolt per meter (mV/m) @ 1 km) for the antenna system. The standard, or augmented standard if pertinent, horizontal plane radiation pattern was calculated using techniques and methods specified in §§ 73.150 and 73.152 of the Commission's rules. Radiation values were calculated for each of 360 radials around the transmitter site. Next, estimated soil conductivity data was retrieved from a database representing the information in FCC Figure R3. Using the calculated horizontal radiation values, and the retrieved soil conductivity data, the distance to the principal community (5 mV/m) contour was predicted for each of the 360 radials. The resulting distance to principal community contours were used to form a geographical polygon. Population counting was accomplished by determining which 2010 block centroids were contained in the polygon. (A block centroid is the center point of a small area containing population as computed by the U.S. Census Bureau.) The sum of the population figures for all enclosed blocks represents the total population for the predicted principal community coverage area.

    FM Stations

    The greater of the horizontal or vertical effective radiated power (ERP) (kW) and respective height above average terrain (HAAT) (m) combination was used. Where the antenna height above mean sea level (HAMSL) was available, it was used in lieu of the average HAAT figure to calculate specific HAAT figures for each of 360 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 Field Strength (50-50) propagation curves specified in 47 CFR 73.313 of the Commission's rules to predict the distance to the principal community (70 dBu (decibel above 1 microVolt per meter) or 3.17 mV/m) contour for each of the 360 radials. The resulting distance to principal community contours were used to form a geographical polygon. Population counting was accomplished by determining which 2010 block centroids were contained in the polygon. The sum of the population figures for all enclosed blocks represents the total population for the predicted principal community coverage area.

    Table 6

    Summary of Regulatory Fee Categories

    Media Bureau

    The fee categories associated with the Media Bureau are as follows:

    AM and FM Broadcast Radio Stations

    1. The AM/FM broadcast radio station regulatory fees are based on population served and class of station. This grid showing the AM and FM regulatory fees based on population served and class of station has been modified over time to take into account a trend toward increases in population and more powerful signal strength.[1] In general, stations with greater populations (e.g., Metropolitan areas) pay higher fees than stations located in rural areas with lower populations.

    AM and FM Construction Permits That Were Granted for AM/FM Radio Stations

    2. AM and FM Construction Permits (CP) are precursors to obtaining a license. These permits are granted so that the studio, the antenna, and other relevant aspects of the station can be constructed before a license is issued by the Commission.

    Digital Full Service Television Broadcast Stations (Including Satellite Stations)

    3. Digital full-service television broadcast stations, including satellite stations, are historically categorized by their Nielsen Designated Market Areas (DMA). In section D, below, we seek comment on changing this methodology for FY 2019.

    Low Power TV, Class A TV, and TV/FM Translators and Boosters

    4. 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 of the Commission's rules 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.

    5. Translators are generally not affiliated with commercial broadcasters, are nonprofit, unprofitable, or only marginally profitable, serve small rural communities, and are supported financially by the residents of the communities served.Start Printed Page 26267

    Cable Antenna Relay Service (CARS)

    6. CARS stations are 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.

    Cable Television, IPTV, and DBS (Currently, a Subcategory of Cable Television and IPTV)

    7. Regulatory fees for FY 2019 for cable television, internet Protocol Television (IPTV), and DBS are based on the number of subscribers as of December 31, 2018. The cable television category includes operators of Cable Television Systems, providing or distributing programming or other services to subscribers under part 76 of the Commission's rules. IPTV is digital television delivered through a high speed internet connection, instead of by the traditional cable method. IPTV service generally is offered bundled with the customer's internet and telephone or VoIP services. DBS service is a nationally distributed subscription service that delivers video and audio programming via satellite to a small parabolic dish antenna at the subscriber's location. The two DBS providers, AT&T [2] and DISH Network, are MVPDs.[3] This regulatory fee subcategory was based on Media Bureau FTE activity involving regulation and oversight of all MVPDs, which included DBS providers.[4] In 2015, the Commission included DBS as a subcategory of the cable television/IPTV regulatory fee. In section C, supra, we seek comment in this proceeding on adopting new regulatory fees for FY 2019 for DBS.

    Wireline Competition Bureau

    8. The regulatory fees for Wireline Competition Bureau regulatees are in the ITSP fee category. Toll Free Numbers are a subcategory of the ITSP category. Audio bridging service providers are also included in the ITSP category.

    ITSP

    9. The regulatory fees for ITSP are based on revenues from interexchange service. On April 1st of each year, ITSP providers file FCC Form 499-A with USAC based on their FCC Form 499-Q (Quarterly) information. The FCC Form 499-A filing is the basis for the total amount of revenues upon which regulatory fees will be assessed, excluding exempt revenue from cooperatives, satellites, and wireless companies. For FY 2019, the ITSP fee rate is calculated by dividing the target revenue goal by the non-exempt revenue reported in the FCC Form 499-A.[5] The resulting figure is the ITSP fee factor that regulatees will multiply against specific revenue lines on FCC Form 499-A to determine their regulatory fee assessment.

    Toll Free

    10. In the FY 2014 Report and Order,[6] the Commission adopted a regulatory fee category for each toll free number managed by a Responsible Organization or RespOrg.[7] In the FY 2015 Report and Order, the Commission first adopted a regulatory fee to be assessed per toll free number.[8] The Commission obtains a specific toll-free number count from SOMOS [9] for each operating RespOrg.

    Wireless Telecommunications Bureau

    11. The fee categories associated with the Wireless Telecommunications Bureau are as follows:

    CMRS

    12. CMRS is a service providing 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. Each licensee in this group pays an annual regulatory fee for each mobile or cellular unit (mobile or telephone number) assigned to its customers, including resellers of its services. The most common use of cellular spectrum is mobile voice and data services, including cell phone, text messaging, and internet service. Cellular licenses are issued by market areas and channel blocks. Part 22 paging (messaging services) [10] is also considered a CMRS service. Because the customer base continues on a long-term decline, the paging services fee has been frozen at eight cents per subscriber since FY 2002.[11]

    Other Wireless Services, Subject to Multiyear Fees

    13. In addition to CMRS, there are eight wireless services whose licensees pay regulatory fees. These multiyear fees are paid in advance and for the amount of the ten year term of the license.[12]

    14. Microwave. Common carrier microwave stations, authorized under part 101 of the Commission's rules, are generally used in a point-to-point configuration for long-haul backbone connections or to connect points on the telephone network which cannot be connected using standard wire line or fiber optic because of cost or terrain. These systems are also used to connect cellular sites to the telephone network and to relay television signals.

    15. Marine, ship and coast. Maritime Mobile Services are authorized in part 80 of the Commission's rules.[13] A ship station includes all the transmitting and receiving equipment installed aboard a ship for communications afloat. Depending on the size and other factors, the ship radio station must meet certain Start Printed Page 26268requirements established by law or treaty. Marine coast stations serve the maritime community as commercial mobile radio service providers, permitting ships to send and receive messages and to interconnect with the public switched telephone network. In addition to providing needed services for a fee, public coast stations have obligations to monitor distress frequencies and to relay messages free of charge to search and rescue personnel.

    16. Rural Radio. The Rural Radiotelephone Service is in the 152-159 MHz and 454-460 MHz spectrum bands and authorized under part 22 of the Commission's rules. Rural Radiotelephone spectrum is used to provide analog telephone service to subscribers in locations too remote for traditional wireline service.

    17. PLMRS, exclusive use and shared use. Private land mobile radio systems (PLMRS), authorized under Part 90 of the Commission's rules, are used by companies, local governments, and other organizations to meet a wide range of communication requirements. 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 and include radiolocation services, industrial radio services, and land transportation radio services.[14]

    18. Aviation, aircraft and ground. The Aviation Services are authorized in part 87 of the Commission's rules.[15] Aircraft radio stations include all types of radio transmitting equipment used aboard an aircraft, e.g., two-way radiotelephones, radar, radio navigation equipment, and emergency locator transmitters. The primary purpose of aircraft radio equipment is to ensure safety of aircraft in flight.

    Broadband Radio Service (BRS) and Local Multipoint Distribution Service (LMDS)

    19. Broadband Radio Service and Local Multipoint Distribution Services are authorized under parts 27 and 101 of the Commission's Rules to use microwave frequencies for video and data distribution within the United States. BRS and LMDS fees are assessed at the same fee rate and on a per license basis.

    International Bureau

    20. The fee categories associated with the International Bureau are as follows:

    Space Stations and Earth Stations

    21. The International Bureau's oversight and regulation of the satellite industry involves FTEs working on legal, technical, and policy issues pertaining to both space station and earth station operations and is therefore interdependent to some degree.[16] For FY 2019, regulatory fees must be paid for licensed earth stations and for geostationary orbit space stations and non-geostationary orbit satellite systems that were licensed and operational on or before October 1, 2018.

    International Bearer Circuits

    22. We assess regulatory fees on international bearer circuits (IBCs) which consist of terrestrial and satellite [17] and submarine cable.[18] The IBC regulatory fees are calculated by apportioning the revenue requirement between (1) terrestrial and satellite [19] and (2) submarine cable; [20] 12.4 percent of total IBC fees are allocated for terrestrial and satellite IBC fees and 87.6 per cent are allocated for submarine cable fees. The proposed FY 2019 submarine cable regulatory fees are paid on a per cable landing license basis [21] based on circuit capacity as of December 31, 2018. The submarine cable regulatory fee methodology is based on an industry proposal adopted in 2009.[22] The proposed methodology for the FY 2019 terrestrial and satellite IBC regulatory fees is discussed in detail in section E below.

    FY 2018 regulatory fees for the first eight fee categories below are collected by the Commission in advance to cover the term of the license and are submitted at the time the application is filed.

    Start Printed Page 26269

    Table 7—FY 2018 Schedule of Regulatory Fees

    Fee categoryFY 2018 annual regulatory fee (U.S. $s)
    PLMRS (per license) (Exclusive Use) (47 CFR part 90)$25
    Microwave (per license) (47 CFR part 101)25
    Marine (Ship) (per station) (47 CFR part 80)15
    Marine (Coast) (per license) (47 CFR part 80)40
    Rural Radio (47 CFR part 22) (previously listed under the Land Mobile category)10
    PLMRS (Shared Use) (per license) (47 CFR part 90)10
    Aviation (Aircraft) (per station) (47 CFR part 87)10
    Aviation (Ground) (per license) (47 CFR part 87)20
    CMRS Mobile/Cellular Services (per unit) (47 CFR parts 20, 22, 24, 27, 80 and 90).20
    CMRS Messaging Services (per unit) (47 CFR parts 20, 22, 24 and 90).08
    Broadband Radio Service (formerly MMDS/MDS) (per license) (47 CFR part 27)600
    Local Multipoint Distribution Service (per call sign) (47 CFR, part 101)600
    AM Radio Construction Permits550
    FM Radio Construction Permits965
    Digital TV (47 CFR part 73) VHF and UHF Commercial
    Markets 1-1049,750
    Markets 11-2537,450
    Markets 26-5025,025
    Markets 51-10012,475
    Remaining Markets4,100
    Construction Permits4,100
    Satellite Television Stations (All Markets)1,500
    Low Power TV, Class A TV, TV/FM Trans. & Boosters (47 CFR part 74)380
    CARS (47 CFR part 78)1,075
    Cable Television Systems (per subscriber) (47 CFR part 76), Including IPTV.77
    Direct Broadcast Service (DBS) (per subscriber) (as defined by section 602(13) of the Act).48
    Interstate Telecommunication Service Providers (per revenue dollar).00291
    Toll Free (per toll free subscriber) (47 CFR 52.101(f) of the rules).10
    Earth Stations (47 CFR part 25)325
    Space Stations (per operational station in geostationary orbit) (47 CFR part 25) also includes DBS Service (per operational station) (47 CFR part 100)127,850
    Space Stations (per operational system in non-geostationary orbit) (47 CFR part 25)122,775
    International Bearer Circuits—Terrestrial/Satellites (per Gbps circuit)176
    Submarine Cable Landing Licenses Fee (per cable system)See Table Below

    FY 2018 Radio Station Regulatory Fees

    Population servedAM Class AAM Class BAM Class CAM Class DFM Classes A, B1 & C3FM Classes B, C, C0, C1 & C2
    <= 25,000$880$635$550$605$965$1,100
    25,001-75,0001,3259508259101,4501,650
    75,001-150,0001,9751,4251,2501,3502,1752,475
    150,001-500,0002,9752,1501,8502,0503,2503,725
    500,001-1,200,0004,4503,2252,7753,0504,8755,575
    1,200,001-3,000,006,7004,8254,1754,6007,3258,350
    3,000,001-6,000,0010,0257,2256,2756,90011,00012,525
    >6,000,00015,05010,8509,40010,32516,50018,800

    FY 2018 International Bearer Circuits—Submarine Cable

    Submarine cable systems (capacity as of December 31, 2017)Fee amount for FY 2018
    <50 Gbps$9,850
    50 Gbps or greater, but less than 250 Gbps19,725
    250 Gbps or greater, but less than 1,000 Gbps39,425
    1,000 Gbps or greater, but less than 4,000 Gbps78,875
    4000 Gbps or greater157,750

    VII. Initial Regulatory Flexibility Analysis

    53. As required by the Regulatory Flexibility Act of 1980, as amended (RFA),[1] the Commission prepared this Initial Regulatory Flexibility Analysis Start Printed Page 26270(IRFA) of the possible significant economic impact on small entities by the policies and rules proposed in the Notice of Proposed Rulemaking (NPRM). Written comments are requested on this IRFA. Comments must be identified as responses to the IRFA and must be filed by the deadline for comments on this NPRM. The Commission will send a copy of the NPRM, including the IRFA, to the Chief Counsel for Advocacy of the Small Business Administration (SBA).[2] In addition, the NPRM and IRFA (or summaries thereof) will be published in the Federal Register.[3]

    A. Need for, and Objectives of, the Notice

    54. The NPRM seeks comment regarding adopting proposed regulatory fees for Fiscal Year 2019. The proposed regulatory fees are attached to the NPRM in Tables 2 and 3. This regulatory fee NPRM is needed each year because the Commission is required by Congress to adopt regulatory fees each year “to recover the costs of carrying out the activities described in section 6(a) only to the extent, and in the total amounts, provided for in Appropriation Acts.” [4] The objective of the NPRM is to propose regulatory fees for fiscal year 2019 and adopt regulatory fee reform to improve the regulatory fee process. The NPRM seeks comment on the Commission's proposed regulatory fees for fiscal year (FY) 2019. The NPRM proposes to collect $339,000,000 in regulatory fees for FY 2019, as detailed in the proposed fee schedules in Table 2, including a proposed increase in the DBS fee rate to 60 cents per subscriber and proposed fees for full-power broadcast televisions using an average of the actual population covered by the station's contour and the Nielsen Designated Market Area (DMA)-based fee, as set forth in Table 3. Historically, the regulatory fee for full-power broadcast television stations was based on the DMA groupings 1-10, 11-25, 26-50, 51-100, and the remaining markets (101-210), as well as satellite stations that traditionally pay a much lower fee. Additionally, the NPRM seeks comment on replacing our existing annual de minimis threshold of $1000 with a new section 9(e)(2) annual regulatory fee exemption of $1,000.

    B. Legal Basis

    55. This action, including publication of proposed rules, is authorized under sections (4)(i) and (j), 9, 9A, and 303(r) of the Communications Act of 1934, as amended.[5]

    C. Description and Estimate of the Number of Small Entities to Which the Rules Will Apply

    56. 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 and policies, if adopted.[6] The RFA generally defines the term “small entity” as having the same meaning as the terms “small business,” “small organization,” and “small governmental jurisdiction.” [7] In addition, the term “small business” has the same meaning as the term “small business concern” under the Small Business Act.[8] 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 SBA.[9]

    57. Small Entities. Our actions, over time, may affect small entities that are not easily categorized at present. We therefore describe here, at the outset, three comprehensive small entity size standards that could be directly affected by the proposals under consideration.[10] As of 2009, small businesses represented 99.9 percent of the 27.5 million businesses in the United States, according to the SBA.[11] In addition, a “small organization is generally any not-for-profit enterprise which is independently owned and operated and not dominant in its field.[12] In addition, the term “small governmental jurisdiction” is defined generally as “governments of cities, towns, townships, villages, school districts, or special districts, with a population of less than fifty thousand.” [13] U.S. Census Bureau data for 2011 indicate that there were 90,056 local governmental jurisdictions in the United States.[14] We estimate that, of this total, as many as 89,327 entities may qualify as “small governmental jurisdictions.” [15] Thus, we estimate that most local government jurisdictions are small.

    58. Wired Telecommunications Carriers. The U.S. Census Bureau defines this industry as “establishments primarily engaged in operating and/or providing access to transmission facilities and infrastructure that they own and/or lease for the transmission of voice, data, text, sound, and video using wired communications networks. Transmission facilities may be based on a single technology or a combination of technologies. Establishments in this industry use the wired telecommunications network facilities that they operate to provide a variety of services, such as wired telephony services, including VoIP services, wired (cable and IPTV) audio and video programming distribution, and wired broadband internet services. By exception, establishments providing satellite television distribution services using facilities and infrastructure that they operate are included in this industry.” [16] The SBA has developed a small business size standard for Wired Telecommunications Carriers, which consists of all such companies having 1,500 or fewer employees.[17] Census data for 2012 shows that there were 3,117 firms that operated that year. Of this total, 3,083 operated with fewer than 1,000 employees.[18] Thus, under this size standard, the majority of firms in this industry can be considered small.

    59. Local Exchange Carriers (LECs). Neither the Commission nor the SBA has developed a size standard for small businesses specifically applicable to local exchange services. The closest Start Printed Page 26271applicable NAICS code category is for Wired Telecommunications Carriers. Under that size standard, such a business is small if it has 1,500 or fewer employees.[19] According to census data from 2012, there were 3,117 establishments that operated that year. Of this total, 3,083 operated with fewer than 1,000 employees.[20] The Commission estimates that most providers of local exchange service are small entities that may be affected by the rules proposed in the NPRM.

    60. Incumbent LECs. Neither the Commission nor the SBA has developed a small business size standard specifically for incumbent local exchange services. The closest applicable NAICS code category is Wired Telecommunications Carriers. Under that size standard, such a business is small if it has 1,500 or fewer employees.[21] According to census data from 2012, 3,117 firms operated in that year. Of this total, 3,083 operated with fewer than 1,000 employees.[22] According to Commission data, 1,307 carriers reported that they were incumbent local exchange service providers.[23] Of this total of 1,307 incumbent local exchange service providers, an estimated 1,006 operated with 1,500 or fewer employees.[24] Consequently, the Commission estimates that most providers of incumbent local exchange service are small businesses that may be affected by the rules proposed in this NPRM.

    61. Competitive Local Exchange Carriers (Competitive LECs), Competitive Access Providers (CAPs), Shared-Tenant Service Providers, and Other Local Service Providers. Neither the Commission nor the SBA has developed a small business size standard specifically for these service providers. The appropriate NAICS code category is Wired Telecommunications Carriers. Under that size standard, such a business is small if it has 1,500 or fewer employees.[25] U.S. Census data for 2012 indicate that 3,117 firms operated during that year. Of that number, 3,083 operated with fewer than 1,000 employees.[26] Based on this data, the Commission concludes that the majority of Competitive LECs, CAPs, Shared-Tenant Service Providers, and Other Local Service Providers are small entities. According to the Commission data, 1,442 carriers reported that they were engaged in the provision of either competitive local exchange services or competitive access provider services.[27] Of these 1,442 carriers, an estimated 1,256 have 1,500 or fewer employees. In addition, 17 carriers have reported that they are Shared-Tenant Service Providers, and all 17 are estimated to have 1,500 or fewer employees.[28] Also, 72 carriers have reported that they are Other Local Service Providers.[29] Of this total, 70 have 1,500 or fewer employees.[30] Consequently, the Commission estimates that most providers of competitive local exchange service, competitive access providers, Shared-Tenant Service Providers, and Other Local Service Providers are small entities that may be affected by rules proposed in this NPRM.

    62. Interexchange Carriers (IXCs). Neither the Commission nor the SBA has developed a definition for Interexchange Carriers. The closest NAICS code category is Wired Telecommunications Carriers as defined in paragraph 6 of this IRFA. The applicable size standard under SBA rules is that such a business is small if it has 1,500 or fewer employees.[31] U.S. Census data for 2012 indicate that 3,117 firms operated during that year. Of that number, 3,083 operated with fewer than 1,000 employees.[32] According to Commission data, 359 companies reported that their primary telecommunications service activity was the provision of interexchange services.[33] Of this total, an estimated 317 have 1,500 or fewer employees. Consequently, the Commission estimates that the majority of interexchange service providers are small entities that may be affected by rules proposed in this NPRM.

    63. Prepaid Calling Card Providers. Neither the Commission nor the SBA has developed a small business size standard specifically for prepaid calling card providers. The appropriate NAICS code category for prepaid calling card providers is Telecommunications Resellers. This industry comprises establishments engaged in purchasing access and network capacity from owners and operators of telecommunications networks and reselling wired and wireless telecommunications services (except satellite) to businesses and households. Establishments in this industry resell telecommunications; they do not operate transmission facilities and infrastructure. Mobile virtual networks operators (MVNOs) are included in this industry.[34] Under the applicable SBA size standard, such a business is small if it has 1,500 or fewer employees.[35] U.S. Census data for 2012 show that 1,341 firms provided resale services during that year. Of that number, 1,341 operated with fewer than 1,000 employees.[36] Thus, under this category and the associated small business size standard, the majority of these prepaid calling card providers can be considered small entities. According to Commission data, 193 carriers have reported that they are engaged in the provision of prepaid calling cards.[37] All 193 carriers have 1,500 or fewer employees.[38] Consequently, the Commission estimates that the majority of prepaid calling card providers are small entities that may be affected by rules proposed in this NPRM.

    64. Local Resellers. Neither the Commission nor the SBA has developed a small business size standard specifically for Local Resellers. The SBA has developed a small business size standard for the category of Telecommunications Resellers. Under that size standard, such a business is small if it has 1,500 or fewer employees.[39] Census data for 2012 show that 1,341 firms provided resale services during that year.[40] Of that number, 1,341 operated with fewer than 1,000 employees.[41] Under this category and the associated small business size Start Printed Page 26272standard, the majority of these local resellers can be considered small entities. According to Commission data, 213 carriers have reported that they are engaged in the provision of local resale services.[42] Of this total, an estimated 211 have 1,500 or fewer employees.[43] Consequently, the Commission estimates that the majority of local resellers are small entities that may be affected by rules proposed in this NPRM.

    65. Toll Resellers. The Commission has not developed a definition for Toll Resellers. The closest NAICS code Category is Telecommunications Resellers, and the SBA has developed a small business size standard for the category of Telecommunications Resellers.[44] Under that size standard, such a business is small if it has 1,500 or fewer employees.[45] Census data for 2012 show that 1,341 firms provided resale services during that year.[46] Of that number, 1,341 operated with fewer than 1,000 employees.[47] Thus, under this category and the associated small business size standard, the majority of these resellers can be considered small entities. According to Commission data, 881 carriers have reported that they are engaged in the provision of toll resale services.[48] Of this total, an estimated 857 have 1,500 or fewer employees.[49] Consequently, the Commission estimates that the majority of toll resellers are small entities that may be affected by the rules proposed in the NPRM.

    66. Other Toll Carriers. Neither the Commission nor the SBA has developed a size standard for small businesses specifically applicable to Other Toll Carriers. This category includes toll carriers that do not fall within the categories of interexchange carriers, operator service providers, prepaid calling card providers, satellite service carriers, or toll resellers. The closest applicable NAICS code category is for Wired Telecommunications Carriers, as defined in paragraph 6 of this IRFA. Under that size standard, such a business is small if it has 1,500 or fewer employees.[50] Census data for 2012 shows that there were 3,117 firms that operated that year.[51] Of this total, 3,083 operated with fewer than 1,000 employees.[52] Thus, under this category and the associated small business size standard, the majority of Other Toll Carriers can be considered small. According to Commission data, 284 companies reported that their primary telecommunications service activity was the provision of other toll carriage.[53] Of these, an estimated 279 have 1,500 or fewer employees.[54] Consequently, the Commission estimates that most Other Toll Carriers are small entities that may be affected by the rules proposed in the NPRM.

    67. Wireless Telecommunications Carriers (except Satellite). This industry comprises establishments engaged in operating and maintaining switching and transmission facilities to provide communications via the airwaves. Establishments in this industry have spectrum licenses and provide services using that spectrum, such as cellular services, paging services, wireless internet access, and wireless video services.[55] The appropriate size standard under SBA rules is that such a business is small if it has 1,500 or fewer employees. For this industry, Census Data for 2012 show that there were 967 firms that operated for the entire year.[56] Of this total, 955 firms had fewer than 1,000 employees.[57] Thus under this category and the associated size standard, the Commission estimates that the majority of wireless telecommunications carriers (except satellite) are small entities. Similarly, according to Commission data, 413 carriers reported that they were engaged in the provision of wireless telephony, including cellular service, Personal Communications Service (PCS), and Specialized Mobile Radio (SMR) services.[58] Of this total, an estimated 261 have 1,500 or fewer employees.[59] Thus, using available data, we estimate that the majority of wireless firms can be considered small and may be affected by rules proposed in this NPRM.

    68. Television Broadcasting. This Economic Census category “comprises establishments primarily engaged in broadcasting images together with sound. These establishments operate television broadcasting studios and facilities for the programming and transmission of programs to the public.” [60] These establishments also produce or transmit visual programming to affiliated broadcast television stations, which in turn broadcast the programs to the public on a predetermined schedule. Programming may originate in their own studio, from an affiliated network, or from external sources. The SBA has created the following small business size standard for Television Broadcasting firms: Those having $38.5 million or less in annual receipts.[61] The 2012 Economic Census reports that 751 television broadcasting firms operated during that year. Of that number, 656 had annual receipts of less than $25 million per year. Based on that Census data we conclude that a majority of firms that operate television stations are small. The Commission has estimated the number of licensed commercial television stations to be 1,387.[62] In addition, according to Commission staff review of the BIA Advisory Services, LLC's Media Access Pro Television Database on March 28, 2012, about 950 of an estimated 1,300 commercial television stations (or approximately 73 percent) had revenues of $14 million or less.[63] We therefore estimate that the majority of commercial television broadcasters are small entities.

    69. In assessing whether a business concern qualifies as small under the above definition, business (control) affiliations [64] must be included. Our estimate, therefore, likely overstates the number of small entities that might be affected by our action, because the revenue figure on which it is based does not include or aggregate revenues from affiliated companies. In addition, an element of the definition of “small business” is that the entity not be Start Printed Page 26273dominant in its field of operation. We are unable at this time to define or quantify the criteria that would establish whether a specific television station is dominant in its field of operation. Accordingly, the estimate of small businesses to which rules may apply does not exclude any television station from the definition of a small business on this basis and is therefore possibly over-inclusive to that extent.

    70. In addition, the Commission has estimated the number of licensed noncommercial educational (NCE) television stations to be 396.[65] These stations are non-profit, and therefore considered to be small entities.[66] There are also 2,528 low power television stations, including Class A stations (LPTV).[67] Given the nature of these services, we will presume that all LPTV licensees qualify as small entities under the above SBA small business size standard.

    71. Radio Broadcasting. This Economic Census category “comprises establishments primarily engaged in broadcasting programs by radio to the public. Programming may originate in their own studio, from an affiliated network, or from external sources.” [68] The SBA has established a small business size standard for this category, which is: Such firms having $38.5 million or less in annual receipts.[69] U.S. Census data for 2012 show that 2,849 radio station firms operated during that year.[70] Of that number, 2,806 operated with annual receipts of less than $25 million per year.[71] According to Commission staff review of BIA Advisory Services, LLC's Media Access Pro Radio Database on March 28, 2012, about 10,759 (97 percent) of 11,102 commercial radio stations had revenues of $38.5 million or less. Therefore, the majority of such entities are small entities.

    72. In assessing whether a business concern qualifies as small under the above size standard, business affiliations must be included.[72] In addition, to be determined to be a “small business,” the entity may not be dominant in its field of operation.[73] It is difficult at times to assess these criteria in the context of media entities, and our estimate of small businesses may therefore be over-inclusive.

    73. Cable Television and other Subscription Programming. This industry comprises establishments primarily engaged in operating studios and facilities for the broadcasting of programs on a subscription or fee basis. The broadcast programming is typically narrowcast in nature, e.g., limited format, such as news, sports, education, or youth-oriented. These establishments produce programming in their own facilities or acquire programming from external sources. The programming material is usually delivered to a third party, such as cable systems or direct-to-home satellite systems, for transmission to viewers.[74] The SBA has established a size standard for this industry of $38.5 million or less. Census data for 2012 shows that there were 367 firms that operated that year.[75] Of this total, 319 operated with annual receipts of less than $25 million.[76] Thus under this size standard, the majority of firms offering cable and other program distribution services can be considered small and may be affected by rules proposed in this NPRM.

    74. Cable Companies and Systems. The Commission has developed its own small business size standards for the purpose of cable rate regulation. Under the Commission's rules, a “small cable company” is one serving 400,000 or fewer subscribers nationwide.[77] Industry data indicate that there are currently 4,600 active cable systems in the United States.[78] Of this total, all but ten cable operators nationwide are small under the 400,000-subscriber size standard.[79] In addition, under the Commission's rate regulation rules, a “small system” is a cable system serving 15,000 or fewer subscribers.[80] Current Commission records show 4,600 cable systems nationwide.[81] Of this total, 3,900 cable systems have less than 15,000 subscribers, and 700 systems have 15,000 or more subscribers, based on the same records.[82] Thus, under this standard as well, the Commission estimates that most cable systems are small entities.

    75. Cable System Operators (Telecom Act Standard). The Communications Act also contains a size standard for small cable system operators, 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.” [83] There are approximately 52,403,705 cable video subscribers in the United States today.[84] Accordingly, an operator serving fewer than 524,037 subscribers shall be deemed a small operator if its annual revenues, when combined with the total annual revenues of all its affiliates, do not exceed $250 million in the aggregate.[85] Based on available data, we find that all but nine incumbent cable operators are small entities under this size standard.[86] The Commission neither requests nor collects information on whether cable system operators are affiliated with entities whose gross annual revenues exceed $250 million.[87] Although it seems certain that some of these cable system operators are affiliated with entities whose gross annual revenues exceed $250,000,000, we 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.

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    76. Direct Broadcast Satellite (DBS) Service. DBS Service is a nationally distributed subscription service that delivers video and audio programming via satellite to a small parabolic dish antenna at the subscriber's location. DBS is now included in SBA's economic census category “Wired Telecommunications Carriers.” The Wired Telecommunications Carriers industry comprises establishments primarily engaged in operating and/or providing access to transmission facilities and infrastructure that they own and/or lease for the transmission of voice, data, text, sound, and video using wired telecommunications networks. Transmission facilities may be based on a single technology or combination of technologies. Establishments in this industry use the wired telecommunications network facilities that they operate to provide a variety of services, such as wired telephony services, including VOIP services, wired (cable) audio and video programming distribution; and wired broadband internet services. By exception, establishments providing satellite television distribution services using facilities and infrastructure that they operate are included in this industry.[88] The SBA determines that a wireline business is small if it has fewer than 1500 employees.[89] Census data for 2012 indicate that 3,117 wireline companies were operational during that year. Of that number, 3,083 operated with fewer than 1,000 employees.[90] Based on that data, we conclude that the majority of wireline firms are small under the applicable standard. However, currently only two entities provide DBS service, which requires a great deal of capital for operation: AT&T and DISH Network.[91] AT&T and DISH Network each report annual revenues that are in excess of the threshold for a small business. Accordingly, we must conclude that DBS service is provided only by large firms.

    77. All Other Telecommunications. “All Other Telecommunications” is defined as follows: This U.S. industry is comprised of establishments that are primarily engaged in providing specialized telecommunications services, such as satellite tracking, communications telemetry, and radar station operation. This industry also includes establishments primarily engaged in providing satellite terminal stations and associated facilities connected with one or more terrestrial systems and capable of transmitting telecommunications to, and receiving telecommunications from, satellite systems. Establishments providing internet services or Voice over internet Protocol (VoIP) services via client-supplied telecommunications connections are also included in this industry.[92] The SBA has developed a small business size standard for “All Other Telecommunications,” which consists of all such firms with gross annual receipts of $32.5 million or less.[93] For this category, census data for 2012 show that there were 1,442 firms that operated for the entire year. Of these firms, a total of 1,400 had gross annual receipts of less than $25 million.[94] Thus, a majority of “All Other Telecommunications” firms potentially affected by the proposals in the NPRM can be considered small.

    78. RespOrgs. Responsible Organizations, or RespOrgs, are entities chosen by toll free subscribers to manage and administer the appropriate records in the toll free Service Management System for the toll free subscriber.[95] Although RespOrgs are often wireline carriers, they can also include non-carrier entities. Therefore, in the definition herein of RespOrgs, two categories are presented, i.e., Carrier RespOrgs and Non-Carrier RespOrgs.

    79. Carrier RespOrgs. Neither the Commission, the U.S. Census, nor the SBA have developed a definition for Carrier RespOrgs. Accordingly, the Commission believes that the closest NAICS code-based definitional categories for Carrier RespOrgs are Wired Telecommunications Carriers,[96] and Wireless Telecommunications Carriers (except satellite).[97]

    80. The U.S. Census Bureau defines Wired Telecommunications Carriers as establishments primarily engaged in operating and/or providing access to transmission facilities and infrastructure that they own and/or lease for the transmission of voice, data, text, sound, and video using wired communications networks. Transmission facilities may be based on a single technology or a combination of technologies. Establishments in this industry use the wired telecommunications network facilities that they operate to provide a variety of services, such as wired telephony services, including VoIP services, wired (cable) audio and video programming distribution, and wired broadband internet services. By exception, establishments providing satellite television distribution services using facilities and infrastructure that they operate are included in this industry.[98] The SBA has developed a small business size standard for Wired Telecommunications Carriers, which consists of all such companies having 1,500 or fewer employees.[99] Census data for 2012 show that there were 3,117 Wired Telecommunications Carrier firms that operated for that entire year. Of that number, 3,083 operated with less than 1,000 employees.[100] Based on that data, we conclude that the majority of Carrier RespOrgs that operated with wireline-based technology are small.

    81. The U.S. Census Bureau defines Wireless Telecommunications Carriers (except satellite) as establishments engaged in operating and maintaining switching and transmission facilities to provide communications via the airwaves, such as cellular services, paging services, wireless internet access, and wireless video services.[101] The appropriate size standard under SBA rules is that such a business is small if it has 1,500 or fewer employees.[102] Census data for 2012 show that 967 Wireless Telecommunications Carriers operated in that year. Of that number, 955 operated with less than 1,000 employees.[103] Based on that data, we conclude that the majority of Carrier RespOrgs that operated with wireless-based technology are small.

    82. Non-Carrier RespOrgs. Neither the Commission, the U.S. Census, nor the SBA have developed a definition of Non-Carrier RespOrgs. Accordingly, the Commission believes that the closest NAICS code-based definitional categories for Non-Carrier RespOrgs are “Other Services Related to Start Printed Page 26275Advertising” [104] and “Other Management Consulting Services.” [105]

    83. The U.S. Census defines Other Services Related to Advertising as comprising establishments primarily engaged in providing advertising services (except advertising agency services, public relations agency services, media buying agency services, media representative services, display advertising services, direct mail advertising services, advertising material distribution services, and marketing consulting services).[106] The SBA has established a size standard for this industry as annual receipts of $15 million dollars or less.[107] Census data for 2012 show that 5,804 firms operated in this industry for the entire year. Of that number, 5,612 operated with annual receipts of less than $10 million.[108] Based on that data we conclude that the majority of Non-Carrier RespOrgs who provide toll-free number (TFN)-related advertising services are small.

    84. The U.S. Census defines Other Management Consulting Services as establishments primarily engaged in providing management consulting services (except administrative and general management consulting; human resources consulting; marketing consulting; or process, physical distribution, and logistics consulting). Establishments providing telecommunications or utilities management consulting services are included in this industry.[109] The SBA has established a size standard for this industry of $15 million dollars or less.[110] Census data for 2012 show that 3,683 firms operated in this industry for that entire year. Of that number, 3,632 operated with less than $10 million in annual receipts.[111] Based on this data, we conclude that a majority of non-carrier RespOrgs who provide TFN-related management consulting services are small.[112]

    85. In addition to the data contained in the four (see above) U.S. Census NAICS code categories that provide definitions of what services and functions the Carrier and Non-Carrier RespOrgs provide, Somos, the trade association that monitors RespOrg activities, compiled data showing that as of July 1, 2016 there were 23 RespOrgs operational in Canada and 436 RespOrgs operational in the United States, for a total of 459 RespOrgs currently registered with Somos.

    D. Description of Projected Reporting, Recordkeeping and Other Compliance Requirements

    86. This NPRM does not propose any changes to the Commission's current information collection, reporting, recordkeeping, or compliance requirements.

    E. Steps Taken To Minimize Significant Economic Impact on Small Entities, and Significant Alternatives Considered

    87. The RFA requires an agency to describe any significant alternatives that it has considered in reaching its approach, which may include the following four alternatives, among others: (1) The establishment of differing compliance or reporting requirements or timetables that take into account the resources available to small entities; (2) the clarification, consolidation, or simplification of compliance or reporting requirements under the rule for small entities; (3) the use of performance, rather than design, standards; and (4) an exemption from coverage of the rule, or any part thereof, for small entities.[113]

    88. This NPRM seeks comment on the Commission's regulatory fee collection for Fiscal Year 2019, as required by Congress each year. Specifically, the Commission asks for comment each year in the Regulatory Flexibility Analysis on how to minimize adverse economic impact, imposed by our proposed rules, on small entities. Additionally, this year the Commission sought comment on how modifications to section 9 of the Communications Act in the RAY BAUM'S Act, impacted the Commission's core responsibilities under the statute. As discussed in the order, the Commission remains charged with ensuring that regulatory fees will result in collections of amounts that can reasonably be expected to equal amounts appropriated by Congress for each fiscal year.[114] We find that the scheme as articulated under the RAY BAUM'S Act is closely aligned to how the Commission implemented its authority under the prior version of section 9 of the Communications Act.

    89. The NPRM seeks comment on the Commission's proposed regulatory fees for fiscal year (FY) 2019. The NPRM proposes to collect $339,000,000 in regulatory fees for FY 2019, as detailed in the proposed fee schedules in Table 2, including an increase in the DBS fee rate to 60 cents per subscriber. DBS providers are not small entities. The NPRM seeks comment on changing the methodology for assessing regulatory fees for full-power broadcast television stations to use an average of the actual population and the DMA-based rate. The NPRM also seeks comment on its proposal to continue to base non-common carrier and common carrier satellite and terrestrial IBC fees on the per Gbps rate in Table 2, which would be $121 for FY 2019. This proposal would ensure that satellite and terrestrial IBC fees remain proportional to the size of the regulated entity and avoid unreasonable increases in such regulatory fees on small entities. The NPRM also seeks comment on replacing our existing annual de minimis threshold of $1,000 with a new section 9(e)(2) annual regulatory fee exemption of $1,000. This exemption will reduce burdens on small entities with regulatory fees that total $1,000 or less than $1,000.

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

    90. None.

    VIII. Ordering Clause

    91. Accordingly, it is ordered that, pursuant to the authority found in Sections 4(i) and (j), 9, 9A, and 303(r) of the Communications Act of 1934, as amended, 47 U.S.C. 154(i), 154(j), 159, 159A, and 303(r), this Notice of Proposed Rulemaking is hereby adopted.

    Start Signature

    Federal Communications Commission.

    Marlene Dortch,

    Secretary.

    End Signature End Supplemental Information

    Footnotes

    2.  Fiscal year 2019 started on October 1, 2018.

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    3.  47 U.S.C. 159. Consolidated Appropriations Act, 2019, Public Law Number 116-6, Division D—Financial Services and General Government Appropriations Act, 2019, Title V—Independent Agencies (2019) (FY 2019 Appropriation).

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    4.  Consolidated Appropriations Act, 2018, Division P—RAY BAUM'S Act of 2018, Title I, FCC Reauthorization, Public Law Number 115-141, section 102, 132 Stat. 348, 1082-86 (2018) (codified at 47 U.S.C. 159, 159A). Congress provided an effective date of October 1, 2018 for such changes.

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    5.  As explained below, the Commission annually conducts a rulemaking proceeding to update the schedule of regulatory fees—adding, deleting, and adjusting fee categories and fee rates pursuant to guidance provided in section 9. Thus, the schedule found in prior section 9 represents the initial baseline schedule of regulatory fee categories and rates.

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    6.  The changes are discussed in detail below. Table 8 contains the full text of section 9 before and after the effective date of the RAY BAUM'S Act modifications.

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    7.  See section 102(e)(1) of the RAY BAUM'S Act of 2018 (“Not later than 1 year after the effective date described in section 103 of this title, the Commission shall complete a rulemaking proceeding under subsection (d) of section 9 of the Communications Act of 1934, as amended by subsection (b) of this section.”). Congress also provided that the Commission should file a progress report with Congress. See uncodified provision of section 102(e)(2) of the RAY BAUM'S Act of 2018 (“If the Commission has not completed the rulemaking proceeding required by paragraph (1) by the date that is 6 months after the effective date described in section 103 of this title, the Commission shall submit to Congress a report on the progress of such rulemaking proceeding.”).

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    8.  Section 6002(a) of the Omnibus Budget Reconciliation Act of 1993 (hereinafter, “1993 Budget Act”). See Public Law Number 103-66, Title VI, 6002(a), 107 Stat. 397 (approved August 10, 1993). Congress made subsequent minor amendments to the schedule.

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    9.  Currently codified in 47 CFR 1.1152-1.1156.

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    10.  Implementation of Section 9 of the Communications Act, Assessment and Collection of Regulatory Fees for the 1994 Fiscal Year, Report and Order, 9 FCC Rcd 5333, 5344 and Appendix B (1994), recon. denied, 10 FCC Rcd 12759 (1995) (1994 Report and Order) (providing the full descriptions of the fee categories).

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    11.  For a summary of recent changes and improvements to the regulatory fee schedule, see Assessment and Collection of Regulatory Fees for Fiscal Year 2018, Report and Order and Notice of Proposed Rulemaking, 33 FCC 5091, 5093-94, paragraph 5 (2018) (FY 2018 NPRM).

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    12.  One FTE, a “Full Time Equivalent” or “Full Time Employee,” is a unit of measure equal to the work performed annually by a full-time person (working a 40 hour workweek for a full year) assigned to the particular job, and subject to agency personnel staffing limitations established by the U.S. Office of Management and Budget.

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    13.  Assessment and Collection of Regulatory Fees for Fiscal Year 2013, Report and Order, 28 FCC Rcd 12351, 12354-58, paragraphs 10-20 (2013) (FY 2013 Report and Order).

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    14.  Assessment and Collection of Regulatory Fees for Fiscal Year 2015, Notice of Proposed Rulemaking, Report and Order, and Order, 30 FCC Rcd 5354, 5364-5373, paragraphs 28-41 (2015) (FY 2015 NPRM).

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    15.  The Commission stated “[s]ince DBS providers generally benefit from the regulatory activities of the Media Bureau, much like cable operators and IPTV providers, the Commission can attribute Media Bureau FTEs to DBS providers and require them to pay Media Bureau regulatory fees.” FY 2015 NPRM, 30 FCC at 5370, paragraph 35. MVPD is defined in section 602(13) of the Act, 47 U.S.C. 522(13).

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    16.  Assessment and Collection of Regulatory Fees for Fiscal Year 2016, Report and Order, 31 FCC Rcd 10339, 10350-51, paragraphs 31-33 (2016) (FY 2016 Report and Order).

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    17.  Assessment and Collection of Regulatory Fees for Fiscal Year 2017, Report and Order and Further Notice of Proposed Rulemaking, 32 FCC Rcd 7057, 7071-74, paragraphs 34-35, 38-42 (2017) (FY 2017 Report and Order).

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    18.  47 U.S.C. 159(a) (“shall assess and collect regulatory fees”), 159(b) (“Commission shall assess and collect regulatory fees at such rates as the Commission shall establish in a schedule of regulatory fees that will result in the collection, in each fiscal year, of an amount that can reasonably be expected to equal the amounts described in subsection (a) with respect to such fiscal year.”). See also 47 U.S.C. 156(b).

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    19.  Although the Commission adopts a new schedule of regulatory fees each fiscal year in the Commission's rules, the initial (obsolete) schedule remained in former section 9(g) of the Act.

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    20.  47 U.S.C. 159(b) (requirement to establish a schedule); see supra n.7 (citing uncodified provision of section 102(e)(1) of the RAY BAUM'S Act of 2018, which directs the Commission to “complete a rulemaking proceeding under subsection (d) of section 9 of the Communications Act of 1934, as amended by subsection (b) of this section”).

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    21.  47 U.S.C. 159(d). Such changes are referred to as amendments under section 9(d) in section 9A(a) referencing adjustments under section 9(d).

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    22.  47 U.S.C. 159(c). Such changes are referred to as adjustments under section 9(c) in section 9A(a) referencing adjustments under section 9(c).

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    23.  Compare prior section 9(a) with new sections 9(a) and (b).

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    24.  Compare prior section 9(b)(1)(A) with new section new 9(d).

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    25.  See supra paragraph 4 (summarizing several prior Commission regulatory fee orders making revisions to our methodology).

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    26.  The Private Radio Bureau, Mass Media Bureau, Common Carrier Bureau.

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    27.  See prior section 9(b)(1)(A).

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    28.  Compare prior section 9(b)(2) “be adjusted to reflect . . . unexpected increases or decreases in the number of licensees or units” with new section 9(c)(1)(A) “reflect unexpected increases or decreases in the number of units subject to the payment of such fees. . . .”

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    29.  See prior section 9(b)(3).

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    30.  See prior section 9(b)(2) entitled “Mandatory Adjustment of Schedule.” These adjustments occurred if the Commission determined “that the Schedule requires amendment to comply with the requirements” of prior section 9(b)(1)(A).

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    31.  See prior section 9(b)(3) entitled “Permitted Amendments.”

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    32.  47 U.S.C. 159(c) Adjustment of Schedule.

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    33.  47 U.S.C. 159(d) Amendments to Schedule.

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    34.  The Commission has stated that three overarching goals for assessing regulatory fees are fairness, administrability, and sustainability. See Procedures for Assessment and Collection of Regulatory Fees, Notice of Proposed Rulemaking, 27 FCC Rcd 8458, 8464-65, paragraphs 14-16 (2012) (FY 2012 NPRM). Commenters should discuss whether these three goals are still applicable under the new sections 9 and 9A in the RAY BAUM'S Act. The concept of administrability would include the difficulty in collecting regulatory fees under a system that could have unpredictable dramatic shifts in assessed fees in certain categories from year to year.

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    37.  Assessment and Collection of Regulatory Fees for Fiscal Year 2004, Report and Order, 19 FCC Rcd 11662, 11666, paragraph 11 (2004) (FY 2004 Report and Order). As the Commission explained, adjustments to the fee schedule due to increases or decreases in the amount of units or licensees may not implicate costs. FY 2004 Report and Order, 19 FCC Rcd at 11666, paragraph 9. Further, an attempt to adjust fees to mirror costs would be unworkable because any reduction in one category must be counterbalanced by increases in other categories. Id., 19 FCC Rcd at 11666, paragraph 10.

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    38.  For example, governmental and nonprofit entities, amateur radio operators, and noncommercial radio and television stations are exempt from regulatory fees under section 9(e)(1). 47 U.S.C. 159(e)(1); 47 CFR 1.1162.

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    40.  47 U.S.C. 309(j)(8)(B) (providing that “the salaries and expenses account of the Commission shall retain as an offsetting collection such sums as may be necessary from such proceeds for the costs of developing and implementing the program required by this subsection.”)

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    41.  See, e.g., FY 2019 Appropriation (“proceeds from the use of a competitive bidding system that may be retained and made available for obligation shall not exceed $130,284,000 for fiscal year 2019”).

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    42.  The phrase “core” bureaus was first adopted in the FY 2012 NPRM where the Commission explained that under (prior) section 9(b)(1)(A), the Commission was instructed to calculate the regulatory fees by determining the FTEs performing the activities enumerated in section 9(a)(1) within the Private Radio Bureau, Mass Media Bureau, and Common Carrier Bureau, and other offices of the Commission, and those bureaus had subsequently been renamed as the Wireless Telecommunications Bureau, Media Bureau, and Wireline Competition Bureau, and a new International Bureau had been formed. FY 2012 NPRM, 27 FCC Rcd at 8460, paragraph 5 & n.5. The Commission explained that “[f]or simplicity and ease of reference, in this Notice we will refer to these four bureaus as the `core' bureaus or the `core licensing' bureaus.” Id.

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    43.  The Commission observed in the FY 2013 Report and Order that “the high percentage of the indirect FTEs is indicative of the fact that many Commission activities and costs are not limited to a particular fee category and instead benefit the Commission as a whole.” See FY 2013 Report and Order, 28 FCC Rcd at 12357, paragraph 17. The new Office of Economics and Analytics consists of indirect FTEs.

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    44.  See FY 2012 NPRM, 27 FCC Rcd at 8461-62, paragraphs 8-11.

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    45.  The indirect FTEs are the non-auctions employees from the following bureaus and offices: Enforcement Bureau, Consumer & Governmental Affairs Bureau, Public Safety and Homeland Security Bureau, part of the International Bureau, part of the Wireline Competition Bureau, Chairman and Commissioners' offices, Office of the Managing Director, Office of General Counsel, Office of the Inspector General, Office of Communications Business Opportunities, Office of Engineering and Technology, Office of Legislative Affairs, Office of Strategic Planning and Policy Analysis, Office of Workplace Diversity, Office of Media Relations, Office of Economics and Analytics, and Office of Administrative Law Judges.

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    46.  In the past, we have based the FTE count in the core bureaus on the number of FTEs in the beginning of the fiscal year. The Commission took two actions during FY 2019 that significantly impacted the numbers of FTEs in the core bureaus. First, staff reassignments to the Office of Economics and Analytics (OEA) were formally effective on December 11, 2018. See Establishment of the Office of Economics and Analytics, Order, 33 FCC Rcd 1539 (2018); FCC Opens Office Of Economics And Analytics, Federal Communications Commission News Release, December 11, 2018, https://www.fcc.gov/​document/​fcc-opens-office-economics-and-analytics. The creation of OEA resulted in the reassignment of 95 FTEs (of which 64 were not auctions-funded) to the new OEA as indirect FTEs. Second, staff reassignments for Equal Employment Opportunity enforcement moved seven FTEs from the Media Bureau to the Enforcement Bureau effective March 15, 2019. See Transfer of EEO Audit and Enforcement Responsibilities to Enforcement Bureau, Public Notice, DA 19-186 (released Mar. 15, 2019). Our calculation accounts for (1) the direct FTEs in the four core bureaus prior to the formation of OEA, (2) the direct FTEs in the four core bureaus following the formation of OEA, and (3) the direct FTEs in the four core bureaus following the reorganization that moved seven FTEs from the Media Bureau to the Enforcement Bureau, and thus from direct to indirect, on March 15, 2019.

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    47.  1994 Report and Order, 9 FCC Rcd at 5344.

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    48.  MVPD is defined in section 602(13) of the Act, 47 U.S.C. 522(13).

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    49.  Assessment and Collection of Regulatory Fees for Fiscal Year 2018, Report and Order and Order, 33 FCC Rcd 8497, 8944, paragraph 8 (2018) (FY 2018 Report and Order).

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    50.  FY 2018 Report and Order, 33 FCC Rcd at 8944-8500, paragraph 8.

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    51.  Assessment and Collection of Regulatory Fees for Fiscal Year 2015, Report and Order and Further Notice of Proposed Rulemaking, 30 FCC Rcd 10268, 10277, paragraph 20 (2015) (FY 2015 Report and Order).

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    52.  FY 2015 Report and Order, 30 FCC Rcd at 10277, paragraph 20.

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    53.  FY 2017 Report and Order, 32 FCC Rcd at 7067, paragraph 20; FY 2016 Report and Order, 31 FCC Rcd at 10350, paragraph 30. In each of these years, the Commission also assessed a separate one-time fee on DBS operators on a per-subscriber basis to account for moving expenses.

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    54.  FY 2018 NPRM, 33 FCC Rcd at 5099, paragraph 19.

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    55.  FY 2018 Report and Order, 33 FCC Rcd at 8501, paragraph 11; FY 2017 Report and Order, 32 FCC Rcd at 7067-68, paragraphs 22-23; see also FY 2015 NPRM, 30 FCC Rcd at 5369, paragraph 33 (“We also reject the argument raised by DIRECTV and DISH that section 9 of the Act requires us to `show that DBS and cable occupy a comparable number of FTEs.' ”).

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    56.  FY 2018 Report and Order, 33 FCC Rcd at 8501, paragraph 11.

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    57.  ITSP, regulated by the Wireline Competition Bureau, includes interexchange carriers (IXCs), incumbent local exchange carriers (LECs), toll resellers, Voice over Internet Providers (VoIP), and other service providers, all of which involve different degrees of regulatory oversight.

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    58.  As the Commission observed in the FY 2018 Report and Order, “Although a common pool of FTEs work on MVPD and related issues for DBS operators, IPTV providers, and cable TV systems, . . . we believe it is prudent to adopt our proposal to increase such rates by less than one cent per subscriber per month. . . .” FY 2018 Report and Order, 33 FCC Rcd at 8500, paragraph 10. The Commission has consistently observed that the Media Bureau FTEs work on the regulation and oversight of MVPDs, that includes DBS, cable television, and IPTV. See FY 2017 Report and Order, 32 FCC Rcd at 7065, paragraph 19; FY 2016 Report and Order, 31 FCC Rcd at 10350, paragraph 30.

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    59.  FY 2018 NPRM, 33 FCC Rcd at 5102, paragraph 28.

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    60.  Id. (quoting prior section 9(b)(1)(A)).

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    63.  FY 2018 Report and Order, 33 FCC Rcd at paragraph 14.

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    65.  The factor of .72 of one cent was derived by taking the revenue amount required from all television fee categories and dividing it by the total population count of all “feeable” call signs.

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    67.  See 47 U.S.C. 159(d) (“the Commission shall by rule amend the schedule of regulatory fees established under this section if the Commission determines that the schedule requires amendment so that such fees reflect the full-time equivalent number of employees within the bureaus and offices of the Commission, adjusted to take into account factors that are reasonably related to the benefits provided to the payor of the fee by the Commission's activities.”).

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    68.  FY 2018 NPRM, 33 FCC Rcd at 5100-5101, paragraphs 22-26.

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    69.  FY 2018 NPRM, 33 FCC Rcd at 5100-5101, paragraphs 22-26. In the FY 2017 Report and Order, the Commission concluded that IBCs should be assessed regulatory fees for non-common carrier, as well as common carrier, terrestrial circuits. FY 2017 Report and Order, 32 FCC Rcd at 7071-7072, paragraphs 34-35. This new fee was first assessed in FY 2018.

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    70.  Level 3 Communications (now, CenturyLink) proposed a “flat, per provider fee, with a reduced amount for the smaller providers” and argued that this “two-tier methodology . . . is more efficient than a multi-tier methodology because the Commission need identify only one break point, and is less burdensome for providers because, once they pass the `small provider' threshold, they will simply pay the `large' fee category each year.” See Comments of Level 3 Communications, MD Docket No. 16-166 at 3-4 (filed June 23, 2016; see also Comments of CenturyLink, MD Docket No. 18-175, at 2-3 (filed June 21, 2018). CenturyLink did not define the “break point” between small and large provider.

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    73.  47 U.S.C. 159(e)(2). Similarly, section 9(e)(1) exempts from regulatory fees governmental and nonprofit entities, amateur radio operators, and noncommercial radio and television stations. Governmental entities, nonprofits, and amateur radio operators were exempt under the prior version of section 9(h). Under § 1.1162 of our rules, governmental entities, nonprofits, amateur radio operators, special emergency radio and public safety radio licensees, and noncommercial educational radio and television licensees are exempt from regulatory fees. 47 CFR 1.1162. The new section 9(e)(1) incorporated this exemption from our rules into the statute.

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    75.  Assessment and Collection of Regulatory Fees for Fiscal Year 1996, Notice of Proposed Rulemaking, 11 FCC Rcd 16515, 16530, paragraphs 50-51 (1996) (FY 1996 NPRM); Assessment and Collection of Regulatory Fees for Fiscal Year 1996, Report and Order, 11 FCC Rcd 18774, 18792, paragraph 50 (1996) (FY 1996 Report and Order).

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    76.  See Assessment and Collection of Regulatory Fees for Fiscal Year 2014, Report and Order and Further Notice of Proposed Rulemaking, 29 FCC Rcd 10767, 10775-76, paragraph 21 (2014) (FY 2014 Report and Order).

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    78.  Id., 29 FCC Rcd at 10775, paragraph 20.

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    80.  FY 2017 Report and Order, 32 FCC Rcd at 7073, paragraph 40.

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    82.  For example, all annual regulatory fees are due and payable in September of each fiscal year allowing for tracking by fee category and FRN within a single database (Fee Filer). The multi-year regulatory fees due dates are spread throughout each year and these fee categories are not included in the annual regulatory fee database.

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    83.  Compare old sections 9(c) and (d) with new section 9A(c) and (d). In addition to the rule changes discussed below, we propose to delete § 1.1163 of the Commission's rules as redundant given the statutory language and plan to adopt changes in our Report and Order to § 1.1166 of the Commission's rules that track the revised statutory language.

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    85.  FY 1994 Report and Order, 9 FCC Rcd at 5344, paragraph 29.

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    86.  Implementation of Section 9 of the Communications Act, Memorandum Opinion and Order, 10 FCC Rcd 12759, 12761-12762, paragraphs 12-14 (1995).

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    87.  Id. at 12762, paragraph 13.

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    89.  FY 1994 Report and Order, 9 FCC Rcd at 5346.

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    90.  We would except from this requirement administrative and judicial decisions and orders, for which a citation would be sufficient.

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    91.  FY 2003 Report and Order, 18 FCC Rcd. at 15990, paragraph 13.

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    92.  FY 1994 Report and Order, 9 FCC Rcd at 5345, paragraph 34.

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    94.  Section 9A(c)(2) provides that “section 3717 shall not otherwise apply to such a fee or penalty.”

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    95.  See FY 2018 Report and Order, 33 FCC Rcd at 8502-8503, paragraphs 16-17 (adopting this amendment to § 1.1940 of our rules to conform to the RAY BAUM'S Act).

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    101.  See, e.g., Cortaro Broadcasting Corp., Order to Pay or Show Cause, 32 FCC Rcd 9336 (MB 2017).

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    102.  Customers who owe an amount on a bill, debt, or other obligation due to the federal government are prohibited from splitting the total amount due into multiple payments. Splitting an amount owed into several payment transactions violates the credit card network and Fiscal Service rules. An amount owed that exceeds the Fiscal Service maximum dollar amount, $24,999.99, may not be split into two or more payment transactions in the same day by using one or multiple cards. Also, an amount owed that exceeds the Fiscal Service maximum dollar amount may not be split into two or more transactions over multiple days by using one or more cards.

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    103.  Office of Management and Budget (OMB) Memorandum M-10-06, Open Government Directive, Dec. 8, 2009; see also http://www.whitehouse.gov/​the-press-office/​2011/​06/​13/​executive-order-13576-delivering-efficient-effective-and-accountable-gov.

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    104.  See U.S. Department of the Treasury, Open Government Plan 2.1, September 2012.

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    105.  FY 2015 Report and Order, 30 FCC Rcd at 10282-83, paragraph 35. See 47 CFR 1.1158.

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    106.  In accordance with U.S. Treasury Financial Manual Announcement No. A-2014-04 (July 2014), the amount that may be charged on a credit card for transactions with federal agencies has been reduced to $24,999.99.

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    107.  In accordance with U.S. Treasury Financial Manual Announcement No. A-2012-02, the maximum dollar-value limit for debit card transactions is eliminated. Only Visa and MasterCard branded debit cards are accepted by Pay.gov.

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    108.  Audio bridging services are toll teleconferencing services.

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    110.  Cable television system operators should compute their number of basic 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. Operators may base their count on “a typical day in the last full week” of December 2018, rather than on a count as of December 31, 2018.

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    111.  We encourage terrestrial and satellite service providers to seek guidance from the International Bureau's Telecommunications and Analysis Division to verify their particular IBC reporting processes to ensure that their calculation methods comply with our rules.

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    112.  See FY 2005 Report and Order, 20 FCC Rcd at 12264, paragraphs 38-44.

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    113.  In the supporting documentation, the provider will need to state a reason for the change, such as a purchase or sale of a subsidiary, the date of the transaction, and any other pertinent information that will help to justify a reason for the change.

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    1.  See, e.g., FY 2017 Report and Order, 32 FCC Rcd at 7069, paragraph 28; FY 2016 Report and Order, 31 FCC Rcd at 10351, paragraph 33; Assessment and Collection of Regulatory Fees for Fiscal Year 2003, Report and Order, 18 FCC Rcd 15985, 15986-87, paragraph 4 (2003) (FY 2003 Report and Order).

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    2.  AT&T and DIRECTV merged in 2015. See Applications of AT&T and DIRECTV for Consent to Assign or Transfer Control of Licenses and Authorizations, Memorandum Opinion and Order, 30 FCC Rcd 9131 (2015).

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    3.  MVPD is defined in section 602(13) of the Act, 47 U.S.C. 522(13).

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    4.  FY 2015 NPRM, 30 FCC Rcd at 5367-68, paragraph 31.

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    5.  The ITSP fee category represents 30.41% of the total regulatory fees assessed, which when multiplied by the overall regulatory fee goal of $339 million, results in the ITSP target revenue goal of $103.107 million. The Commission in FY 2019 estimates that the ITSP unit count is $32.2 billion. The revenue target goal of $103.107 divided by $32.2 billion results in an ITSP fee factor of $.00320.

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    6.  See Assessment and Collection of Regulatory Fees for Fiscal Year 2014, Report and Order and Further Notice of Proposed Rulemaking, 29 FCC Rcd 10767, 10777-79, paragraphs 25-28 (2014) (FY 2014 Report and Order). We adopted this category for working, assigned, and reserved toll free numbers and for toll free numbers that are in the “transit” status, or any other status as defined in section 52.103 of the Commission's rules. The regulatory fee is limited to toll free numbers that are accessible within the United States.

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    7.  A RespOrg is a company that manages toll free telephone numbers for subscribers. RespOrgs use the SMS/800 database to verify the availability of specific numbers and to reserve the numbers for subscribers. See 47 CFR 52.101(b). Commission FTEs in the Wireline Competition Bureau and the Enforcement Bureau work on toll free numbering issues and other related activities. As a result, the Commission adopted a regulatory fee for each toll free number controlled or managed by a RespOrg because many toll free numbers are controlled or managed by RespOrgs that are not carriers, and therefore, had not been paying regulatory fees. In the FY 2014 Report and Order, the Commission stated that: “Based on evaluation, the FTEs involved in toll free issues are primarily from the Wireline Competition Bureau. . . . Accordingly, a regulatory fee assessed on toll free numbers reduces the ITSP regulatory fee total.” FY 2014 Report and Order, 29 FCC Rcd at 10778, paragraph 27 (footnote omitted).

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    8.  FY 2015 Report and Order, 30 FCC Rcd at 10271-72, paragraph 9.

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    9.  SOMOS is an organization that grants toll-free numbers to Responsible Organizations.

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    10.  CMRS messaging replaced the CMRS one-way paging fee category. See Assessment and Collection of Regulatory Fees for Fiscal Year 1997, Report and Order, 12 FCC Rcd 17161, 17184-85, paragraph 60 (1997) (FY 1997 Report and Order).

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    11.  See FY 2003 Report and Order, 18 FCC Rcd at 15992, paragraph 21.

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    12.  See Assessment and Collection of Regulatory Fees for Fiscal Year 2005, Report and Order, 20 FCC Rcd 12259, 12267, paragraph 26 (2005) (FY 2005 Report and Order).

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    14.  We note that prior section 9(b)(1)(A) listed as examples of factors related to “benefits provided” a regulate to include “service area coverage, shared use versus exclusive use, and other factors that the Commission determines are necessary in the public interest.” Current sections 9 and 9A do not mention shared use versus exclusive use.

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    16.  Assessment and Collection of Regulatory Fees for Fiscal Year 2014, Notice of Proposed Rulemaking, Second Further Notice of Proposed Rulemaking, and Order, 29 FCC Rcd 6417, 6428, paragraph 29 (2014) (FY 2014 NPRM).

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    17.  Regulatory fees for terrestrial and satellite IBCs are paid based on active (used or leased) international bearer circuits as of December 31, 2018 in any terrestrial or satellite transmission facility for the provision of service to an end user or resale carrier. Active circuits include backup and redundant circuits as of December 31, 2018. Whether circuits are used specifically for voice or data is not relevant for purposes of determining that they are active circuits.

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    18.  Submarine cables provide the primary means of connectivity—voice, data and internet—between the United States and the rest of the world as well as connectivity between the mainland United States and consumers in Alaska, Hawaii, Guam, American Samoa, the Northern Mariana Islands, Puerto Rico, and the U.S. Virgin Islands.

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    19.  Initially, this fee category was for common carrier IBCs. The Commission added non-common carrier satellite IBCs in this regulatory fee category in 1997. See FY 1997 Report and Order, 12 FCC Rcd at 17189, paragraph 71. More recently, the Commission added non-common carrier terrestrial IBCs in this regulatory fee category in 2017. See FY 2017 Report and Order, 32 FCC Rcd at 7071-72, paragraphs 34-35.

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    20.  The submarine cable regulatory fee includes services provided to common carriers using the submarine cables, in addition to the International Bureau's regulatory activity concerning submarine cables, such as the bureau's review, analysis, and grant of applications for submarine cable landing license applications, as well as transfers, assignments, and modifications. See FY 2015 Report and Order, 30 FCC Rcd at 10273, paragraph 12. The bureau also coordinates processing of submarine cable landing license applications with the relevant Executive Branch agencies. and the bureau's services provided to common carriers using the submarine cable circuits, include benchmarks enforcement, protection from anticompetitive actions by foreign carriers, foreign ownership rulings (Petitions for Declaratory Rulings, or PDRs), section 214 authorizations, and bilateral and multilateral negotiations and representation of U.S. interests at international organizations. See FY 2015 Report and Order, 30 FCC Rcd at 10273, paragraph 12.

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    21.  A cable landing license must be obtained prior to landing a submarine cable to connect the continental United States with any foreign country; Alaska, Hawaii or the U.S. territories or possessions with a foreign country, the continental United States, or with each other; and points within the continental United States, Alaska, Hawaii or a territory or possession in which the cable is laid within international waters.

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    22.  See Assessment and Collection of Regulatory Fees for Fiscal Year 2008, Second Report and Order, 24 FCC Rcd 4208 (2009) (Submarine Cable Order).

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    1.  5 U.S.C. 603. The RFA, 5 U.S.C. 601-612 has been amended by the Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA), Public Law Number 104-121, Title II, 110 Stat. 847 (1996).

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    8.  5 U.S.C. 601(3) (incorporating by reference the definition of “small-business concern” in the Small Business Act, 15 U.S.C. 632). Pursuant to 5 U.S.C. 601(3), the statutory definition of a small business applies “unless an agency, after consultation with the Office of Advocacy of the Small Business Administration and after opportunity for public comment, establishes one or more definitions of such term which are appropriate to the activities of the agency and publishes such definition(s) in the Federal Register.”

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    11.  See SBA, Office of Advocacy, “Frequently Asked Questions,” available at https://www.sba.gov/​sites/​default/​files/​advocacy/​SB-FAQ-2016_​WEB.pdf.

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    14.  See SBA, Office of Advocacy, “Frequently Asked Questions,” available at https://www.sba.gov/​sites/​default/​files/​advocacy/​SB-FAQ-2016_​WEB.pdf.

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    15.  The 2011 U.S. Census Data for small governmental organizations are not presented based on the size of the population in each organization. As stated above, there were 90,056 local governmental organizations in 2011. As a basis for estimating how many of these 90,056 local governmental organizations were small, we note that there were a total of 729 cities and towns (incorporated places and civil divisions) with populations over 50,000. See http://factfinder.census.gov/​faces/​tableservices/​jsf/​pages/​productview.xhtml?​pid=​ECN_​2012_​US_​51SSSZ5&​prodType=​table. If we subtract the 729 cities and towns that exceed the 50,000 population threshold, we conclude that approximately 789,237 are small.

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    17.  See 13 CFR 120.201, NAICS code 517110.

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    19.  13 CFR 121.201, NAICS code 517110.

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    21.  13 CFR 121.201, NAICS code 517110.

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    23.  See Trends in Telephone Service, Federal Communications Commission, Wireline Competition Bureau, Industry Analysis and Technology Division at Table 5.3 (September 2010) (Trends in Telephone Service).

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    24.  See id.

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    25.  13 CFR 121.201, NAICS code 517110.

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    27.  See Trends in Telephone Service, at Table 5.3.

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    31.  13 CFR 121.201, NAICS code 517110.

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    33.  See Trends in Telephone Service, at Table 5.3.

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    35.  13 CFR 121.201, NAICS code 517911.

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    37.  See Trends in Telephone Service, at Table 5.3.

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    39.  13 CFR 121.201, NAICS code 517911.

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    42.  See Trends in Telephone Service, at Table 5.3.

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    44.  13 CFR 121.201, NAICS code 517911.

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    48.  Trends in Telephone Service, at Table 5.3.

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    50.  13 CFR 121.201, NAICS code 517110.

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    53.  Trends in Telephone Service, at Table 5.3.

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    58.  Trends in Telephone Service, at Table 5.3.

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    60.  U.S. Census Bureau, 2012 NAICS code Economic Definitions, http://www.census.gov.cgi-bin/​sssd/​naics/​naicsrch.

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    61.  13 CFR 121.201, NAICS code 515120.

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    62.  See FCC News Release, “Broadcast Station Totals as of December 31, 2011,” dated January 6, 2012; http://transition.fcc.gov/​Daily_​Releases/​Daily_​Business/​2012/​db0106/​DOC-311837A1.pdf.

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    63.  We recognize that BIA's estimate differs slightly from the FCC total given supra.

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    64.  “[Business concerns] are affiliates of each other when one concern controls or has the power to control the other or a third party or parties controls or has to power to control both.” 13 CFR 21.103(a)(1).

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    65.  See FCC News Release, “Broadcast Station Totals as of December 31, 2011,” dated January 6, 2012; http://transition.fcc.gov/​Daily_​Releases/​Daily_​Business/​2012/​db0106/​DOC-311837A1.pdf.

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    66.  See generally 5 U.S.C. 601(4), (6). Noncommercial television stations are not required to pay regulatory fees. 47 U.S.C. 159(e)(1)(C).

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    67.  See FCC News Release, “Broadcast Station Totals as of December 31, 2011,” dated January 6, 2012; http://transition.fcc.gov/​Daily_​Releases/​Daily_​Business/​2012/​db0106/​DOC-311837A1.pdf.

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    69.  13 CFR 121.201, NAICS code 515112.

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    72.  “Concerns and entities are affiliates of each other when one controls or has the power to control the other, or a third party or parties controls or has the power to control both. It does not matter whether control is exercised, so long as the power to control exists.” 13 CFR 121.103(a)(1).

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    73.  13 CFR 121.102(b) (an SBA regulation).

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    78.  August 15, 2015 Report from the Media Bureau based on data contained in the Commission's Cable Operations and Licensing System (COALS). See www/fcc.gov/coals.

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    79.  See SNL KAGAN at www.snl.com/​interactiveX/​top cableMSOs aspx?period2015Q1&sortcol=subscribersbasic&sortorder=desc.

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    81.  See footnote 2, supra.

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    82.  August 5, 2015 report from the Media Bureau based on its research in COALS. See www.fcc.gov/​coals.

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    83.  47 CFR 76.901 (f) and notes ff. 1, 2, and 3.

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    85.  47 CFR 76.901(f) and notes ff. 1, 2, and 3.

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    87.  The Commission does receive such information on a case-by-case basis if a cable operator appeals a local franchise authority's finding that the operator does not qualify as a small cable operator pursuant to 47 CFR 76.901(f) of the Commission's rules. See 47 CFR 76.901(f).

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    89.  NAICs code 517110; 13 CFR 121.201.

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    91.  See 15th Annual Video Competition Report, 28 FCC Rcd at 1057, section 27.

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    93.  13 CFR 121.201; NAICs code 517919.

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    96.  13 CFR 121.201, NAICS code 517110.

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    99.  13 CFR 120,201, NAICS code 517110.

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    102.  13 CFR 120.201, NAICS code 517120.

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    104.  13 CFR 120.201, NAICS code 541890.

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    105.  13 CFR 120.201, NAICS code 541618.

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    107.  13 CFR 120.201, NAICS code 541890.

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    110.  13 CFR 120.201, NAICS code 514618.

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    112.  The four NAICS code-based categories selected above to provide definitions for Carrier and Non-Carrier RespOrgs were selected because as a group they refer generically and comprehensively to all RespOrgs.

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    114.  47 U.S.C. 159(a) (“shall assess and collect regulatory fees”), 159(b) (“Commission shall assess and collect regulatory fees at such rates as the Commission shall establish in a schedule of regulatory fees that will result in the collection, in each fiscal year, of an amount that can reasonably be expected to equal the amounts described in subsection (a) with respect to such fiscal year.”). See also 47 U.S.C. 156(b).

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    [FR Doc. 2019-10922 Filed 6-4-19; 8:45 am]

    BILLING CODE 6712-01-P

Document Information

Published:
06/05/2019
Department:
Federal Communications Commission
Entry Type:
Proposed Rule
Action:
Proposed rule.
Document Number:
2019-10922
Dates:
Submit comments on or before June 7, 2019; and reply comments on or before June 24, 2019.
Pages:
26234-26275 (42 pages)
Docket Numbers:
MD Docket Nos. 19-105, FCC 19-37
PDF File:
2019-10922.Pdf
CFR: (1)
47 CFR 1