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                          DA 98-2052Released:   October 9, 1998

BY FACSIMILE AND FIRST CLASS MAIL

Thomas Gutierrez, Esq.
1111 Nineteenth Street, N.W.
Suite 1200
Washington, D.C. 20036

Re:  Lancaster Communications, Inc.

Dear Mr. Gutierrez:

     This letter is in response to the requests for waiver of 47 C.F.R.  1.2110(e)(4) filed on
behalf of your client Lancaster Communications, Inc. (Lancaster).  On August 16, 1996, the
Commission granted Lancaster twenty-four 900 MHz Specialized Mobile Radio (SMR) licenses
for which Lancaster was the winning bidder in the auction that concluded on April 15, 1996. 
Grant of these licenses was conditioned upon Lancaster paying its bids in quarterly installment
payments.  Under the Commission's rules in effect at the time, an entity that was more than 90
days delinquent in any installment payment was in default; however, upon default or in
anticipation of default, licensees were permitted to request a grace period of three to six months. 
47 C.F.R.  1.2110(e)(4) (1997).

     Lancaster paid its first, second, and third installment payments more than 90 days after the
due date.  It did not timely request grace periods for these payments, except with respect to the
second installment payment for its Dallas license, station KNNY305.  However, Lancaster
subsequently submitted various requests for waiver of section 1.2110(e)(4) with respect to these
payments.  To date, Lancaster has paid its first installment in full ($49,474.47) and its second and
third installments in the amount of $38,096.77; the portion not paid represents the installment
payment for the Dallas license.  Pending resolution of its waiver requests, Lancaster has not paid
its subsequent installment payments.
.
     Although the Commission's current Part 1 competitive bidding rules allow licensees to pay
installment payments up to 180 days late, as long as they submit a late payment fee, these rules
were not in effect at the time Lancaster missed its payment deadlines.  See 47 C.F.R.
 1.2110(f)(4); Amendment of Part 1 of the Commission's Rules -- Competitive Bidding
Procedures, Third Report and Order, 13 FCC Rcd. 374 (l997).  Under the Commission's rules in
effect at the time, all of Lancaster's 900 MHz SMR licenses should have automatically cancelled
when it failed to pay its first installment payment within 90 days of the deadline and also failed to
timely submit a grace period request.  However, the Wireless Telecommunications Bureau
(Bureau) recognizes that the acceptance of Lancaster's late payments could have been construed
as a waiver of the payment deadlines.   The Bureau therefore grants Lancaster's request for a
waiver of 47 C.F.R.  1.2110(e)(4).  However, we also believe that it is every licensee's
responsibility to ensure that its payments are submitted on time and that Lancaster should have
been more attentive to its payment obligations.  Therefore, Lancaster should not receive a
complete waiver of the payment deadlines.  In light of this finding, we assess Lancaster a late
payment fee of 15 percent of the total amount due in one quarterly installment payment.  Such a
fee is consistent with our policy of giving licensees adequate financial incentives to make
installment payments on time while also providing them with procedures that allow them to
pursue private market solutions to their financing difficulties.  

     In sum, Lancaster will not be deemed in default on its twenty-four 900 MHz SMR licenses
if it makes the following payments no later than 30 days from the issuance of this letter:  (1) full
payment of all unpaid quarterly installment payments for these licenses due through August 31,
1998, including all payments due for the Dallas license; and (2) 15 percent of one installment
payment for all licenses, i.e., $7,421.17.  The total amount due on November 9, 1998, is
$277,548.87.  Failure to timely submit this amount in full will result in the automatic cancellation
of Lancaster's 900 MHz SMR licenses.  This action is taken in accordance with delegated
authority pursuant to 47 C.F.R.  0.331.

     We note that if Lancaster meets these conditions and thus retains its 900 MHz SMR
licenses, it must also resume making regularly scheduled installment payments beginning with the
payment that is due on November 30, 1998, and it will henceforth be subject to the Commission's
amended installment payment rules set forth in 47 C.F.R.  1.2110(f)(4).  We also emphasize that
these rules will be strictly enforced, and we will not entertain repeated requests for waiver of an
installment payment deadline by a single licensee.         
                               
                         Sincerely,



                                        Daniel B. Phythyon                                                 
                         Chief, Wireless Telecommunications Bureau