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FY 2014 Regulatory Fees NPRM

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Released: June 13, 2014
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Federal Communications Commission

FCC 14-88

Before the

Federal Communications Commission

Washington, DC 20554

In the Matter of

)

)

Assessment and Collection of Regulatory Fees

)

MD Docket No. 14-92

for Fiscal Year 2014

)

)

Assessment and Collection of Regulatory Fees

)

MD Docket No. 13-140

for Fiscal Year 2013

)

)

Procedures for Assessment and Collection of

)

MD Docket No. 12-201

Regulatory Fees

)

NOTICE OF PROPOSED RULEMAKING,

SECOND FURTHER NOTICE OF PROPOSED RULEMAKING, AND ORDER

Adopted: June 12, 2014

Released: June 13, 2014

By the Commission:

Comment Date: July 7, 2014

Reply Comment Date: July 14, 2014

I. INTRODUCTION AND EXECUTIVE SUMMARY ........................................................................... 1

II. BACKGROUND.................................................................................................................................... 4

III. CHANGES ADOPTED IN FY 2013 (OR EARLIER) THAT WILL APPLY IN FY 2014................ 10

IV. ORDER AND ADMINISTRATIVE CHANGES FOR FY 2014........................................................ 15

V. NOTICE OF PROPOSED RULEMAKING ........................................................................................ 18

VI. SECOND FURTHER NOTICE OF PROPOSED RULEMAKING.................................................... 20

A. FTE Reallocations.......................................................................................................................... 22

1. Enforcement Bureau and Consumer & Governmental Affairs Bureau................................... 22

2. Office of Engineering & Technology and Other Reallocation Proposals.................................26

3. Reallocations within Fee Categories.…………………………………………………………28

B. Improving the Regulatory Fee Process.......................................................................................... 30

C. Revising Our De Minimis Threshold and Eliminating Categories................................................ 31

D. A Cap or Limitation on Increases of Regulatory Fees for FY 2014.............................................. 34

E. Additional Regulatory Fee Reform................................................................................................ 35

F. Combining Existing Regulatory Fee Categories............................................................................ 36

G. New Regulatory Fee Categories .................................................................................................... 41

1. DBS ......................................................................................................................................... 41

2. Non-U.S.-Licensed Space Stations Serving the United States................................................ 48

3. Toll Free Numbers…………………………………………………………………...……….52

VII. PROCEDURAL MATTERS ......................................................................................................... 53

A. Payment of Regulatory Fees .......................................................................................................... 53

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1. Manner of Payment………………………………………………………………………..….54

2. Lock Box Bank........................................................................................................................ 55

3. Receiving Bank for Wire Payments ........................................................................................ 56

4. De Minimis Regulatory Fees................................................................................................... 57

5. Standard Fee Calculations....................................................................................................... 58

B. Enforcement................................................................................................................................... 59

C. Initial Regulatory Flexibility Analysis........................................................................................... 61

D. Initial Paperwork Reduction Act of 1995 Analysis ....................................................................... 62

E. Filing Instructions.......................................................................................................................... 63

F. Ex Parte Information...................................................................................................................... 65

IX. ORDERING CLAUSES....................................................................................................................... 66

ATTACHMENT A—Calculation of FY 2014 Revenue Requirements and Pro-Rata Fees

ATTACHMENT B—Proposed FY 2014 Regulatory Fees

ATTACHMENT C—Sources of Payment Unit Estimates for FY 2014

ATTACHMENT D—Signal Contours and Associated Population Coverage

ATTACHMENT E—Initial Regulatory Flexibility Analysis

ATTACHMENT F—FY 2013 Regulatory Fees

ATTACHMENT G—Rules (electronic payment requirement)

I.

INTRODUCTION AND EXECUTIVE SUMMARY

1.

In this Notice of Proposed Rulemaking, Second Further Notice of Proposed Rulemaking,

and Order (Notice) we seek comment on the Federal Communication Commission’s (FCC’s or

Commission’s) proposed regulatory fees for fiscal year (FY) 2014 and we continue our efforts to improve

the Commission’s regulatory fee process. In 2013, the Commission sought comment1 on several proposals

to revise the regulatory fee process to more accurately reflect the regulatory activities of current

Commission full time employees (FTEs).2

In the FY 2013 Report and Order,3 released on August 12,

2013, the Commission adopted a number of these proposals, including updating the number of FTEs in the

core bureaus, reallocating certain FTEs in the International Bureau for regulatory fee purposes,

establishing a new regulatory fee category to include Internet Protocol TV (IPTV), and consolidating UHF

and VHF Television stations into one fee category.

2.

This Notice seeks comment on the regulatory fees proposed for FY 2014, set forth in

Attachment B, and on whether AM expanded band radio stations should remain exempt from regulatory

fees. In addition, we explain that, for calculating FY 2014 regulatory fees, the following previously

adopted provisions will apply: (1) UHF/VHF regulatory fees will be combined into one digital television

fee category and (2) IPTV will be included in the cable television systems category for regulatory fee

purposes. In addition, we find it in the public interest to maintain the Commercial Mobile Radio Service

(CMRS) messaging rate at $.08 per subscriber.

1 Procedures for Assessment and Collection of Regulatory Fees; Assessment and Collection of Regulatory Fees for

Fiscal Year 2013, Notice of Proposed Rulemaking and Further Notice of Proposed Rulemaking, 28 FCC Rcd 7790

(2013) (FY 2013 NPRM). Regulatory fees are mandated by Congress in section 9 of the Communications Act of

1934, as amended (Communications Act or Act), and collected to recover the regulatory costs associated with the

Commission’s enforcement, policy and rulemaking, user information, and international activities.

47 U.S.C. §

159(a).

2 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.

3 Assessment and Collection of Regulatory Fees for Fiscal Year 2013, Report and Order, 28 FCC Rcd 12351 (2013)

(FY 2013 Report and Order).

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3.

In the attached Second Further Notice of Proposed Rulemaking, we seek comment on

additional reform measures to improve the regulatory fee process, including the adoption of methodologies

tailored to ensure a more equitable distribution of the regulatory fee burden among categories of

Commission licensees under the statutory framework in section 9 of the Communications Act.4

Some of

the issues for which we seek comment were raised by commenters in FY 2013 (or earlier) and we now

tailor our inquiry, in response to the more developed record, to further examine these proposals.

Proposals

for which we seek further comment include: (1) reallocating some of the FTEs from the Enforcement

Bureau, the Consumer & Governmental Affairs Bureau (CGB), and the Office of Engineering and

Technology (OET) as direct FTEs for regulatory fee purposes; (2) reapportioning the fee allocations

between groups of International Bureau regulatees; (3) periodically updating FTE allocations; (4) applying

a cap on any regulatory fee increases for FY 2014; (5) improving access to information through our

website; (6) establishing a higher de minimis threshold, such as $100, $500, or $1,000; (7) eliminating

certain regulatory fee categories that account for a small amount of regulatory fee payments; (8)

combining Interstate Telecommunications Service Providers (ITSP) and wireless voice services into one

fee category; (9) adding direct broadcast satellite (DBS) operators to the cable television and IPTV

category; (10) creating a new regulatory fee category for non-U.S. licensed space stations, or, alternatively,

reallocating some FTEs assigned to work on non-U.S. licensed space station issues as indirect for

regulatory fee purposes; and (11) adding a new regulatory fee category for toll free numbers.

Some of

these reforms would constitute mandatory amendments pursuant to section 9(b)(2) of the Act. To the

extent that some of the reforms and other changes would constitute permitted amendments, Congressional

notification pursuant to sections 9(b)(3) and 9(b)(4)(B) would be required. In addition, we are adopting

revisions to sections 1.1112, 1.1158, 1.1161, and 1.1164 of our rules,5 to correspond with the

Commission’s FY 2013 Report and Order requiring electronic payment of regulatory fees.6

II.

BACKGROUND

4.

Congress requires the Commission to collect regulatory fees “to recover the costs of …

enforcement activities, policy and rulemaking activities, user information services, and international

activities.”7 The fees assessed each fiscal year are to “be derived by determining the full-time equivalent

number of employees performing” these activities, “adjusted to take into account factors that are

reasonably related to the benefits provided to the payer of the fee by the Commission’s activities….”8

Regulatory fees recover direct costs, such as salary and expenses; indirect costs, such as overhead

functions; and support costs, such as rent, utilities, or equipment.9 Regulatory fees also cover the costs

incurred by entities that are exempt from paying regulatory fees,10 entities whose regulatory fees are

waived,11 and entities that provide nonregulated services.12 Congress sets the amount the Commission

must collect each year in the Commission’s fiscal year appropriations, and section 9(a)(2) of the Act

4 47 U.S.C. § 159.

5 47 C.F.R. §§ 1.1112, 1.1158, 1.1161, 1.1164. See Attachment G for the revised rules.

6 See FY 2013 Report and Order, 28 FCC Rcd at 12365-66, para. 44.

7 47 U.S.C. § 159(a).

8 47 U.S.C. § 159(b)(1)(A).

9 See Assessment and Collection of Regulatory Fees for Fiscal Year 2004, Report and Order, 19 FCC Rcd 11662,

11666, para. 11 (2004) (FY 2004 Report and Order).

10 For example, governmental and nonprofit entities are exempt from regulatory fees under section 9(h) of the Act.

47 U.S.C. § 159(h); 47 C.F.R. § 1.1162.

11 47 C.F.R. § 1.1166.

12 For example, broadband services.

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requires us to collect fees sufficient to offset, but not exceed, the amount appropriated. For FY 2014, this

amount is $339,844,000.

5.

To calculate regulatory fees, the Commission allocates the total collection target, as

mandated by Congress each year, across all regulatory fee categories. The allocation of fees to fee

categories is based on the Commission’s calculation of FTEs in each regulatory fee category. Historically,

the Commission allocated FTEs as “direct” if the employee is in one of the four “core” bureaus; otherwise,

that employee was considered an “indirect” FTE.13 The total FTEs for each fee category includes the

direct FTEs associated with that category, plus a proportional allocation of the indirect FTEs. Each

regulatee within those fee categories then pays a proportionate share based on some objective measure,

e.g., revenues, subscribers, or licenses.

6.

In the FY 2012 NPRM,14 the Commission proposed updating the FTE allocations for the

first time since 1998.15 After examining updated FTE data, the Commission determined that the

International Bureau employed 22 percent of FTEs considered as direct in 2012, yet that bureau’s

regulatees contributed only 6.3 percent of the total regulatory fee collection for that year. In contrast,

ITSPs (interexchange carriers (IXCs), incumbent local exchange carriers (LECs), toll resellers, and other

IXC service providers regulated by the Wireline Competition Bureau) contributed 47 percent of the total

regulatory fee collection in 2012, yet that bureau employed 29 percent of the FTEs considered direct in

2012.

7.

With respect to updating the FTE allocations, the Commission recognized that, in most of

the core bureaus, the work of most of its FTEs predominantly benefits that bureau’s own licensees or

regulatees. The Commission found, however, that the work performed by most of the International

Bureau’s FTEs benefitted other bureaus’ licensees or the Commission as a whole.16

Based on extensive

review, the Commission determined that 28 of the FTEs from the Policy Division, Satellite Division, and

Bureau front office of the International Bureau should be considered direct FTEs because they are engaged

primarily in oversight and regulation of International Bureau licensees, such as satellite systems and

submarine cable systems.17 The remaining International Bureau FTEs, however, were considered indirect

for regulatory fee purposes.

13 The core bureaus are the Wireline Competition Bureau, Wireless Telecommunications Bureau, Media Bureau, and

part of the International Bureau. The “indirect” FTEs are the employees from the following bureaus and offices:

Enforcement Bureau, Consumer & Governmental Affairs Bureau, Public Safety and Homeland Security Bureau,

Chairman and Commissioners’ offices, Office of 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, and Office of Administrative Law Judges, totaling 954 FTEs (excluding auctions FTEs).

14 See Assessment and Collection of Regulatory Fees for Fiscal Year 2012, Notice of Proposed Rulemaking, 27 FCC

Rcd 8458 (2012) (FY 2012 NPRM).

15 FY 2012 NPRM, 27 FCC Rcd at 8461, para. 8. This issue was also examined by the GAO. See GAO, Federal

Communications Commission, “Regulatory Fee Process Needs to be Updated,” Aug. 2012, GAO-12-686 (GAO

Report). The GAO concluded that the Commission should perform an updated FTE analysis to determine whether

the fee categories should be revised.

16 FY 2013 Report and Order, 28 FCC Rcd at 12355-56, para. 14.

For example, the International Bureau’s largest

division, Strategic Analysis and Negotiation Division (SAND), is responsible for intergovernmental and regional

leadership, negotiation, and planning and oversight of the Commission’s participation in international forums and

conferences. SAND’s activities also cover telecommunications services outside of the International Bureau’s

oversight and regulatory activities; e.g., coordination of wireless services with Canada and Mexico. Because the

activities of the SAND FTEs benefit the licensees in other bureaus in addition to its own licensees, the Commission

reallocated the FTEs in SAND as indirect FTEs.

17 FY 2013 Report and Order, 28 FCC Rcd at 12355-56, para. 14.

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8.

In the FY 2013 Report and Order, the Commission committed to additional regulatory

fee reform and to issuing a Second Further Notice of Proposed Rulemaking, stating:

Various other issues relevant to revising our regulatory fee program were also raised in either the

FY 2013 NPRM or in comments submitted in response to it. Because we require further

information to best determine what action to take on these complex issues, we will consolidate

them for consideration in a Second Further Notice of Proposed Rulemaking that we will issue

shortly. We recognize that these are complex issues and that resolving them will be difficult.

Nevertheless, we intend to conclusively readjust regulatory fees within three years.18

9.

To accomplish this goal, Commission staff continues its efforts to better align the work

performed by its FTEs and the regulatees that benefit from such work, as required by section 9(b) of the

Act. As part of these efforts, Commission staff engaged in extensive discussions with a number of

Commission regulatees to obtain input concerning regulatory fee reform, including additional suggestions

for FTE reallocation.19

We now seek comment, or further comment, on additional regulatory fee changes

we should adopt for FY 2014 and beyond.

III.

CHANGES ADOPTED IN FY 2013 (OR EARLIER) THAT WILL APPLY IN FY 2014

10.

As we discuss below, a number of substantive and procedural changes have previously

been adopted and will apply to the calculation of regulatory fees in FY 2014. For the reasons discussed

previously, we combine UHF/VHF regulatory fees into one digital television fee category20 and include

IPTV in the cable television systems category.21 In addition, we find it in the public interest to retain the

CMRS messaging rate at $.08 per subscriber.22

11.

Combining UHF/VHF Television Regulatory Fees into One Digital Television Fee

Category. In the FY 2013 Report and Order, the Commission combined the VHF and UHF stations in the

same market area into one fee category (with five tiered market segments) beginning in FY 2014 and

eliminated the fee disparity between VHF and UHF stations. 23

12.

Internet Protocol TV is included in the Cable Television Systems Category. In the FY

2013 Report and Order, the Commission concluded that IPTV providers should be subject to the same

regulatory fees as cable providers and, beginning in FY 2014, we are assessing regulatory fees on IPTV

18 Id., 28 FCC Rcd at 12352, para. 5.

19 See, e.g., Enterprise Wireless Alliance, Notice of Ex Parte Presentation (Nov. 1, 2013); Competitive Carriers

Association, Notice of Ex Parte Presentation (Nov. 8, 2013); Critical Messaging Association, Ex Parte

Memorandum (Nov. 14, 2013); CTIA—The Wireless Association, AT&T, Verizon, and T-Mobile, Notice of Ex

Parte Presentation (Nov. 15, 2013); United States Telecom Association (USTelecom), Notice of Ex Parte

Presentation (Nov. 15, 2013); Satellite Industry Association (SIA), Notice of Oral Ex Parte Presentation (Nov. 22,

2013); American Cable Association (ACA), Notice of Ex Parte Presentation (Nov. 22, 2013); Independent

Telephone and Telecommunications Alliance (ITTA), Notice of Ex Parte Communication (Nov. 22, 2013); North

American Submarine Cable Association (NASCA), Notice of Ex Parte Presentation (Dec. 5, 2013); Intelsat

Corporation Notice of Oral Ex Parte Presentation (Dec. 13, 2013); SES, Inmarsat, and Telesat, Notice of Oral Ex

Parte Presentation (Dec. 13, 2013); DIRECTV, DISH Network Corp., Hughes Network Systems, and Echostar

Corp., Notice of Ex Parte Presentation (Dec. 13, 2013), National Association of Broadcasters (NAB), Notice of

Late-Filed Ex Parte Communication (Jan. 24, 2014).

20 FY 2013 Report and Order, 28 FCC Rcd at 12361-62, paras. 29-31.

21 Id., 28 FCC Rcd at 12362-63, paras. 32-33.

22 Id., 28 FCC Rcd at 12363-64, paras. 35-36.

23 Id., 28 FCC Rcd at 12362, para. 30.

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providers in the same manner as we assess fees on cable television providers; we are not, however, stating

that IPTV providers are cable television providers.24

13.

Congressional notification. As required by sections 9(b)(3) and 9(b)(4)(B) of the Act,25

the Commission notified Congress on March 27, 2014 of the addition of IPTV to the cable television

system fee category and the combination of UHF and VHF stations in the same market into a single fee

category.26 The pending 90-day congressional notification period expires on June 25, 2014, upon which

these changes will become effective.

14.

Commercial Mobile Radio Service (CMRS) Messaging. CMRS Messaging Service,

which replaced the CMRS One-Way Paging fee category in 1997, includes all narrowband services.27

Initially, the Commission froze the regulatory fee for this fee category at the FY 2002 level to provide

relief to the paging industry by setting an applicable rate of $0.08 per subscriber beginning in FY 2003.28

At that time the Commission noted that CMRS Messaging units had significantly declined from 40.8

million in FY 1997 to 19.7 million in FY 2003—a decline of 51.7 percent.29 We continue to observe a

gradual decline in subscribership, which indicates that this decrease is not temporary. We will maintain

the CMRS Messaging fee rate at $.08 per subscriber in FY 2014.30 If we adopt a new de minimis

threshold, as discussed below, some of the CMRS Messaging providers will no longer be required to pay

regulatory fees.

IV.

ORDER AND ADMINISTRATIVE CHANGES FOR FY 2014

15.

We have previously adopted several procedural changes that will apply to this year’s fee

collection. In particular, in the FY 2013 Report and Order we stated the Commission will no longer accept

checks (including cashier’s checks) and the accompanying hardcopy forms (e.g., Form 159’s, Form 159-

B’s, Form 159-E’s, Form 159-W’s) for the payment of regulatory fees.31 This new paperless procedure

will require that all payments be made by online ACH payment, online credit card, or wire transfer.

24 See FY 2013 Report and Order, 28 FCC Rcd at 12363, para. 33. For purposes of this fee, IPTV providers include

the AT&T U-Verse service and other wireline providers that deliver multiple channels of video using Internet

protocol. We note that this regulatory fee will not apply to online video distributors (OVDs), e.g., over-the-top

video providers See Annual Assessment of the Status of Competition in the Market for the Delivery of Video

Programming, 28 FCC Rcd 10496, 10499 n.4 (2013).

25 47 U.S.C. § 159(b)(3); 47 U.S.C. § 159(b)(4)(B).

26 47 U.S.C. § 159(b)(4)(B); Letter concerning permitted amendment from Office of Managing Director, Federal

Communications Commission to Chair and Ranking Members of U.S. House of Representatives’ Committees on

Energy and Commerce and Appropriations and applicable Subcommittees and to Chair and Ranking Members of

the United States Senate Committees on Commerce, Science, and Transportation and Appropriations and applicable

Subcommittees (Mar. 27, 2014).

27 See Assessment and Collection of Regulatory Fees for Fiscal Year 1997, Report and Order, 12 FCC Rcd 17161,

17184-85, para. 60 (1997) (FY 1997 Report and Order).

28 Assessment and Collection of Regulatory Fees for Fiscal Year 2003, Report and Order, 18 FCC Rcd 15985,

15992, para. 22 (2003) (FY 2003 Report and Order).

29 FY 2003 Report and Order, 18 FCC Rcd at 15992, para. 21. The subscriber base in the paging industry declined

93 percent from 40.8 million to 2.97 million between FY 1997 and FY 2013, according to FY 2013 collection data

as of Sept. 30, 2013.

30 If the fee rate were not frozen at $.08 per subscriber, the actual fee rate for the CMRS Messaging fee category

would have been $.46 per subscriber (.39% of all fees with a projected unit count of 2.9 million).

31 See FY 2013 Report and Order, 28 FCC Rcd at 12365-66, para. 44.

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Accordingly, we revise sections 1.1112, 1.1158, 1.1161, and 1.1164 of our rules32 to correspond with the

Commission’s FY 2013 Report and Order requiring electronic payment of regulatory fees.33

16.

Carriers seeking to revise their subscriber counts can do so by accessing Fee Filer.

Providers should follow the prompts in Fee Filer to record their subscriber revisions, along with any

supporting documentation. 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. The Commission will then review the revised

count and supporting documentation and either approve or disapprove the revision.

17.

For purposes of determining a CMRS provider’s subscriber count, the Commission

determines the quantity of assigned telephone numbers from the provider’s Numbering Resource

Utilization Forecast (NRUF) report and adjusts for porting to account for numbers that have been marked

as assigned in their numbering systems but that reflect telephone numbers being served by another

carrier.34 The CMRS count is based on the carrier’s Operating Company Numbers (OCNs) aggregate

subscriber total. For carriers that do not file an NRUF report, the Commission will not calculate an initial

CMRS subscriber total. In these instances, the carriers should compute their fee payment based on

subscriber counts as of December 31, 2013. Regardless of whether the Commission calculates a carrier’s

initial CMRS subscriber count, or the carrier self-reports its subscriber count based on December 31, 2013

totals, the Commission reserves the right to audit the number of subscribers for which regulatory fees are

paid. In the event that the Commission determines that the number of subscribers paid is inaccurate, the

Commission will bill the carrier for the difference between what was paid and what should have been paid,

along with applicable penalties and interest. Finally, beginning this year, the Commission will no longer

mail out initial CMRS assessment letters to CMRS providers.

V.

NOTICE OF PROPOSED RULEMAKING

18.

Proposed regulatory fees. As noted in paragraph four, in FY 2014 we are required to

collect $339,844,000 in regulatory fees.35 Based on the new proposals below and the earlier adopted

changes discussed in Section III, above, we seek comment on the resulting proposed regulatory fees in

Attachment B, which are based on the allocations listed in Table 1 below.

32 47 C.F.R. §§ 1.1112, 1.1158, 1.1161, 1.1164.

33 See Attachment G.

34 See Assessment and Collection of Regulatory Fees for Fiscal Year 2005 and Assessment and Collection of

Regulatory Fees for Fiscal Year 2004, MD Docket Nos. 05-59 and 04-73, Report and Order and Order on

Reconsideration, 20 FCC Rcd 12259, 12264, paras. 38-44 (2005).

35 Attachment A lists the proposed regulatory fees for FY 2014 if none of the changes proposed in the Notice are

adopted. In FY 2013, the Commission was also required to collect $339,844,000 in regulatory fees. The final

collection amount was $10.9 million over this total, which the Commission deposited into the U.S. Treasury. The

year-to-date accumulated total is $81.9 million.

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Table 1: FY 2013 and FY 2014 Allocations of FTEs by Bureau

Bureau

FY 2013 FTE

FY 2013 FTE

FY 2014 FTE

FY 2014

Allocation

Allocation

Allocation

FTE

(uncapped)36

(capped)37

(uncapped)38

Allocation

(capped)39

International

6.13%

6.91%

6.14%

6.13%

Wireless

21.44%

19.59%

20.39%

20.00%

Telecommunica

tions

Wireline

35.01%

39.81%

38.60%

39.17%

Competition

Media

37.42%

33.69%

34.87%

34.70%

19.

AM Expanded Band Radio Stations. The AM Expanded Band licensing rules were

adopted in the 1990’s to promote the cancellation of licenses of “high interfering” stations in the AM

standard band. Migration to the AM Expanded Band was voluntary, and a migrating licensee was allowed

a five-year period to operate in both bands, after which it was to relinquish either its lower band or

expanded band frequency, at its option. As an incentive to move to the expanded band, the Commission

decided not to subject these AM radio stations to regulatory fees. In the FY 2008 FNPRM, however, the

Commission stated that “[t]here is no compelling reason to permanently exempt AM expanded band

licensees from paying regulatory fees. As a general matter, it would be appropriate to treat the AM

expanded band and the AM standard band similarly for regulatory fee purposes.”40 There is no longer a

reason to provide a regulatory incentive to AM broadcasters in the expanded band. A number of those

broadcasters relinquished their standard band licenses and have chosen to operate exclusively in the

expanded band; at least two opted to retain their standard band licenses. There is no reason why

broadcasters who have retained both their standard and expanded band licenses should continue to be

exempt from paying regulatory fees.41 We therefore propose adopting a section 9 regulatory fee obligation

for all AM Expanded Band radio stations, beginning in FY 2014. We seek comment on this proposal.

VI.

SECOND FURTHER NOTICE OF PROPOSED RULEMAKING

20.

In this Second Further Notice of Proposed Rulemaking, we seek comment on additional

proposals for regulatory fee reform. Several of the issues discussed below were previously raised by

36 The FY 2013 (uncapped) column represents the allocation percentages before a fee increase cap of 7.5% was

applied to regulatory fee categories.

37 The FY 2013 (capped) column represents the allocation percentages after a fee increase cap of 7.5% was applied

to regulatory fee categories.

38 The FY 2014 (uncapped) column represents the allocation percentages using updated FY 2014 FTE counts

(through September 30, 2013).

39 The FY 2014 (capped) column represents the allocation percentages using updated FY 2014 FTE counts (through

September 30, 2013), if a cap is applied, e.g. a cap of 7.5%.

40 See Assessment and Collection of Regulatory Fees for Fiscal Year 2008, Report and Order and Further Notice of

Proposed Rulemaking, 24 FCC Rcd 6388, 6393, para. 13 (2008) (FY 2008 FNPRM).

41 FY 2008 FNPRM, 24 FCC Rcd at 6393, para.13 & n.24.

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commenters but were not adopted because we either did not have the opportunity to fully evaluate the

proposals or we determined that additional comments would be useful.42

21.

Our proposals to further reform the regulatory fee process involve consideration of the

following concepts: (1) combining certain regulatory fee categories; (2) creating new fee categories;

and/or (3) reallocating direct or indirect FTEs. In addition, we seek to make the regulatory fee calculation,

collection, and appeal procedures more efficient, transparent, and user friendly. We also seek comment on

adopting a cap on regulatory fee increases, increasing the de minimis threshold, eliminating some

regulatory fee categories, and reexamining FTE allocations periodically.

A.

FTE Reallocations

1.

Enforcement Bureau and Consumer & Governmental Affairs Bureau

22.

We have historically considered the FTEs in the core bureaus to be direct FTEs for

regulatory fee purposes. The FTEs in the non-core bureaus and offices have been considered “indirect,”

and allocated as such across all Commission regulatory fee payors in proportion to their allocated share of

the overall regulatory fee burden. We have not designated any FTEs outside the core bureaus as direct or

used the FTEs of the non-core bureaus to determine regulatory fee allocations. Commenters, however,

have suggested that the work of FTEs in two of the non-core bureaus—the Enforcement Bureau and

CGB—is more focused on certain core bureau(s), and that reallocation of such indirect FTEs as “direct”

for regulatory fee purposes may be appropriate.

23.

In our FY 2013 NPRM we sought comment on “whether the work of indirect FTEs is

focused disproportionately on one or more core bureaus, and if we should allocate indirect FTEs among

the core bureaus on this basis.”43 In response, SIA proposed that we reallocate Enforcement Bureau and

CGB FTEs as direct FTEs to the Wireline Competition Bureau, Wireless Telecommunications Bureau, and

Media Bureau.44 We seek comment on this proposal.

24.

SIA’s argument concerning reallocating indirect FTEs is based on the assumption that

the FTEs in the Enforcement Bureau and CGB spend little time on matters affecting International Bureau

regulatees. Based on our examination into the work done by these bureaus, we believe SIA’s reallocation

proposal deserves further consideration. The Enforcement Bureau regional and field offices, 114 FTEs,

located throughout the Nation,45 are responsible for handling investigations and inspections in response to

complaints (such as pirate radio complaints and wireless interference complaints) and conducting on-site

inspections of radio facilities, cable systems, and antenna structures to determine compliance with

applicable Commission rules.46 The regional and field offices also conduct wireless coordination with

Canada and Mexico, to address potential wireless interference issues for wireless and broadcast services.

Table 2, below, shows the change in FTE allocation if we adopt this proposal and allocate the field and

regional offices FTEs equally to the Wireless Telecommunications Bureau and the Media Bureau. We

seek comment on this proposal, including the appropriate reallocations of FTEs between the two bureaus.

42 See supra para. 9.

43 FY 2013 NPRM, 28 FCC Rcd at 7803, para. 29.

44 SIA Comments at 10 (filed June 19, 2013).

45 For the locations of the regional and field offices, see http://transition.fcc.gov/eb/rfo/.

46 In FY 2013, the Enforcement Bureau database shows that investigations done by the regional and field offices

were almost evenly split between wireless and broadcast-related cases. The regional and field offices’ work

involving wireline carriers is limited to disaster relief efforts. In addition, the regional and field offices as a whole

employ one engineer responsible for addressing all of the Enforcement Bureau’s satellite interference issues. Thus,

the regional and field offices of the Enforcement Bureau devote nearly all of their work (with the exception of one

FTE) to media/broadcast and wireless enforcement.

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In addition, the Enforcement Bureau47 as a whole (i.e., all the Enforcement Bureau divisions including the

regional and field offices)48 is primarily focused on enforcement activity in the wireline, wireless, and

broadcast or media industries, and only occasionally addresses Act and rule violations by International

Bureau licensees.49 We seek comment on this proposal and also seek proposals concerning the appropriate

percentages of FTEs among the three bureaus. Similarly, CGB,50 the bureau responsible for, among other

things, processing informal consumer complaints, received a total of 316,430 informal complaints in 2013

of which 3,682 (approximately one percent of the total informal complaints) were filed against DBS

providers; only a very small number of informal complaints dealt with issues handled by the International

Bureau.51 We seek comment on this proposal and also seek other proposals concerning appropriate

reallocation percentages of FTEs among the three bureaus.

25.

We seek comment on all aspects of SIA’s proposal. We ask commenters for input

concerning whether our analysis accurately attributes the full range of work done by the Enforcement

Bureau and CGB, and whether those two bureaus are more focused on licensees and regulatees of the

Wireline Competition Bureau, Wireless Telecommunications Bureau, and Media Bureau than the

International Bureau.52 Commenters should specify proposed reallocations concerning the Enforcement

Bureau and CGB, and explain the legal and policy reasoning for such support.

2.

Office of Engineering & Technology and Other Reallocation Proposals

26.

We recognize that sometimes the work of the FTEs in a core or non-core bureau may

affect the regulatees of another core bureau or bureaus. We seek comment on whether, in addition to

those divisions affected by the proposed FTE reallocations discussed above, there are other divisions

within the core or non-core bureaus that should be treated as direct FTEs to another bureau. For example,

the Office of Engineering and Technology (OET) advises the Commission on technical and engineering

matters, develops and administers Commission decisions regarding spectrum allocations, develops

technical rules for the operation of unlicensed radio devices, authorizes the marketing of radio frequency

devices as compliant with Commission technical rules, grants experimental radio licenses, and is the

agency’s liaison to the National Telecommunications and Information Administration (NTIA) for

coordinating policy decisions and frequency assignments between Federal agency and non-Federal

spectrum users. OET also manages the FCC’s program to perform broadband speed measurements and

supports inter-bureau broadband projects such as the Technology Transitions Task Force. OET FTEs

provide direct support to the equipment authorization and experimental radio licensing programs, as well

47 The Enforcement Bureau has 262 FTEs as of September 30, 2013.

48 The Enforcement Bureau consists of the following: Office of the Bureau Chief, the Investigations and Hearings

Division, the Market Disputes Resolution Division, the Spectrum Enforcement Division, the Telecommunications

Consumers Division, and the Regional and Field Offices (discussed above). The bureau’s efforts are primarily

focused on enforcement activity in the wireline, wireless, and broadcast or media industries.

49 See, e.g., Intelsat License, LLC, Notice of Apparent Liability for Forfeiture, 28 FCC Rcd 17183 (2013) (apparent

violation of section 25.158(e) of the Commission’s rules).

50 CGB has 156 FTEs. The division responsible for informal complaints is the Consumer Inquiries and Complaints

Division, with 55 FTEs.

CGB develops and implements the Commission’s consumer policies, including disability

access issues; provides outreach and education to consumers; and responds to consumer inquiries and informal

complaints. CGB also maintains partnerships with state, local, and Tribal governments on issues of emergency

preparedness and implementation of new technologies.

51 Although DBS providers are licensed by the International Bureau, the Media Bureau is responsible for overseeing

DBS providers’ compliance with the Commission’s rules. Informal complaints filed by consumers against DBS

providers could therefore be considered Media Bureau issues rather than International Bureau issues.

52 We also note that one of the CGB divisions, the Reference Information Center, contains public filings from all

telecommunications industries, including International Space Station files.

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as indirectly to the Commission’s overall spectrum policy planning processes (e.g., spectrum allocations).

We seek comment on whether and to what extent commenters believe OET’s work is focused on the

licensees and regulatees of the Wireless Telecommunications Bureau, Wireline Competition Bureau,

Media Bureau, and International Bureau, and whether a portion of OET FTEs should be directly allocated

to those bureaus for determining regulatory fees. Commenters should specify proposed reallocations and

the legal and policy reasoning for such support.

27.

Of the proposals presented above, for illustrative purposes, the following Table 2

approximates the impact based on adopting two of these proposals—reallocating the CGB and EB

regional and field offices—as direct to certain core bureaus.

Table 2: Reallocating the CGB and EB Regional and Field offices

Bureau

Current FTE

Current FTE

CGB FTEs

EB Regional

FTE total

53

Direct

Indirect

and Field

Offices FTEs

International

28 FTEs

47.5 FTEs

0 FTEs

0 FTEs

75.5 FTEs

(6.14%)

(6.14%)

(0.00%)

(0.00%)

(5.03%)

Wireless

93 FTEs

157.9 FTEs

52 FTEs

57 FTEs

359.9 FTEs

(20.39%)

(20.39%)

(33.33%)

(50.00%)

(24%)

Wireline

176 FTEs

298.7 FTEs

52 FTEs

0 FTEs

526.7 FTEs

(38.60%)

(38.60%)

(33.33%)

(0.00%)

(35.11%)

Media

159 FTEs

269.9 FTEs

52 FTEs

57 FTEs

537.9 FTEs

(34.87%)

(34.87%)

(33.33%)

(50.00%)

(35.86%)

Total

456

774

156

114

1,500

3.

Reallocations within Fee Categories

28.

Submarine Cable. Submarine cable systems transport data, as well as voice services, for

international carriers, Internet providers, wholesale operators, corporate customers, and governments. As

discussed in the FY 2013 NPRM, international submarine cable service involves minimal regulation and

oversight from the Commission after the initial licensing process.54 For example, such activity is limited to

filing Traffic and Revenue Reports regarding international services and for U.S. facilities based

international common carriers, and Circuit Status Reports.55 Several commenters in response to the FY

2013 NPRM suggested that the regulatory fees among International Bureau licensees should be adjusted to

reflect this minimal oversight.56 The satellite operators and earth stations pay 59 percent of regulatory fees

allocated to International Bureau licensees, and the submarine cable and bearer circuit fee categories pay

41 percent. We tentatively conclude that we should revise the apportionment between the satellite/earth

station operators and the submarine cable operators/terrestrial/satellite circuits to reduce the proportional

allocation for submarine cable operators/terrestrial/satellite circuits and increase the allocation for

53 This illustration is based on the adoption of the proposals to allocate the FTEs from the Enforcement Bureau

Regional and Field offices and CGB.

54 FY 2013 NPRM, 28 FCC Rcd at 7802, para. 27.

55 Id.

56 See, e.g., NASCA Comments at 8-9 (filed June 19, 2013); Telstra Comments at 2 (filed June 19, 2013); ICC

Reply Comments at 2 (filed June 19, 2013).

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satellite/earth station operators to more accurately reflect the amount of oversight and regulation for these

industries.57

29.

Earth Stations. An earth station transmits or receives messages from a satellite.

Currently, earth station licensees pay regulatory fees of $275 per year while satellite operators pay

$139,100 (for space stations, per operational system in geostationary orbit) and $149,875 (for space

stations, per operational system in non-geostationary orbit) per year. We recognize that earth station and

satellite oversight and regulation, although using different quantities of FTEs, is interdependent to some

degree and also involves issues pertaining to non-U.S.-licensed space stations. Commenters suggest that

we increase the percentage of regulatory fees assigned to earth stations. We therefore seek comment on

whether we should increase this allocation in order to reflect more appropriately the regulation and

oversight of this industry. Commenters should also discuss whether the type of earth station authorization

should affect the relative allocation for regulatory fees. We invite comment on whether any material

distinction should be drawn concerning the appropriate allocation of regulatory fees among various types

of earth station authorizations.

B.

Improving the Regulatory Fee Process

30.

Following this analysis for FY 2014, how often should we conduct an in depth review in

the future? How often should we revisit our methodology for allocation of direct FTEs? Absent any

changes in methodology, how often should we update the number of FTEs in the core bureaus in order to

calculate regulatory fees? Commenters should recommend an appropriate time frame, such as every three

years, that balances the need for stability for industry sectors to budget for regulatory fees against the need

to reflect the changing work of the Commission FTEs.

C.

Revising Our De Minimis Threshold and Eliminating Regulatory Fee Categories

31.

Under the Commission’s present policy on de minimis regulatory fee payments, a

regulatee is exempt from paying regulatory fees if the sum total of all of its regulatory fee liabilities for the

fiscal year is less than $10. For example, using FY 2013 fee data, an ITSP would be exempt if the total

calendar year revenues did not exceed $2,881. A cell phone operator would be exempt if the number of

subscribers did not exceed 55; a cable television operator would be exempt if the subscriber number did

not exceed nine. We propose increasing the de minimis threshold to provide more relief to smaller

entities. We seek comment whether we should establish a higher de minimis amount, such as $100, $500,

$750, or $1,000. In doing so, we seek comment on whether the administrative burden on small regulatees

and the FCC’s operational costs associated with processing and collecting these fees outweigh the benefits

of such payments. Commenters should discuss whether certain categories of licensees, such as those who

are subject to frequency coordination by private industry groups, should be excluded from regulatory fees

due to limited Commission regulation, among other things. Commenters should also discuss whether

smaller entities with limited funds are more likely to be unable to budget for regulatory fees on a timely

basis and therefore incur late fees and use more Commission resources for fee collection. In addition,

commenters should address whether we should phase in a higher de minimis threshold over two or more

years.

32.

Similarly, we seek comment on whether to include certain fee categories (e.g., broadcast

and multi-year licenses) in a new de minimis threshold. Commenters should discuss whether adding a new

tier for broadcast, for smaller stations, would be feasible. Concerning multi-year licenses, we propose

excluding two categories whose regulatory fees for the term of the license would be under $100: vanity

57 The revenue allocation between submarine cable operators and common carrier terrestrial/satellite circuits is 87.6

percent/12.4 percent. This was adopted in the Submarine Cable Order. See Assessment and Collection of

Regulatory Fees for Fiscal Year 2008, Second Report and Order, 24 FCC Rcd 4208 (2009) (Submarine Cable

Order). We do not propose any change to the 87.6/12.4 allocation between submarine cable operators and common

carrier terrestrial/satellite circuits.

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call signs ($21.60 for a 10-year license) and General Mobile Radio Service (GMRS) ($25 for a five-year

license).58 We also seek comment on eliminating certain other regulatory fee categories, such as Satellite

TV, Satellite TV Construction Permits, Broadcast Auxiliaries, LPTV/Class A Television and FM

Translators/Boosters, and CMRS Messaging (Paging), from regulatory fees because the categories account

for such a small amount of regulatory fees. We seek comment on the benefits of discontinuing such

collections. Commenters should discuss how other multi-year licenses should be treated with respect to a

de minimis threshold. We note that some licensees may hold many multi-year licenses; commenters

should address whether it would be burdensome for such licensees to have some multi-year licenses above

the de minimis threshold and some below.

33.

We tentatively conclude that eliminating categories from our regulatory fee schedule

would be a permitted amendment as defined in section 9(b)(3) of the Act,59 and pursuant to section

9(b)(4)(B) must be submitted to Congress at least 90 days before it would become effective.60

D.

A Cap or Limitation on Increases of Regulatory Fees for FY 2014

34.

For FY 2014, unlike last year, it is unlikely regulatees will experience substantial increases

in their regulatory fees.61 Nevertheless, out of an abundance of caution, we seek comment on the

appropriateness of a cap to prevent, “unexpected, substantial increases which could severely impact the

economic wellbeing of these licensees.”62

We seek comment on whether to continue to apply a cap of 7.5

percent, or a higher cap, such as 10 percent, on the amount by which regulatory fee rates increase in FY 2014

over the FY 2013 fee rates, before rounding FY 2014 rates, for any category resulting solely from the

reallocations of FTEs or our reform measures adopted in the FY 2013 Report and Order or in this

proceeding.63 Therefore, if adopting our proposals would create a substantial increase in the fee rate for any

category of regulatees we would cap such an increase. We seek comment on the reasonableness of a 7.5

percent or 10 percent cap for FY 2014. We also invite proposals for higher or lower percentages.

Commenters suggesting a different cap should explain how such proposals would prevent a severe impact on

the economic wellbeing of licensees yet remain consistent with the goal to more accurately align FTEs with

their areas of work. A cap limiting increases, if adopted, would be effective for FY 2014.

E.

Additional Regulatory Fee Reform

35.

We also seek comment on ways to further improve our regulatory fee process to make it

less burdensome for all entities, specifically smaller entities. We recognize that the Commission is

currently seeking comment on Commission-wide “Process Reform.”64 Any comments relating specifically

to the regulatory fee processes could also be filed in this docket for implementation for FY 2014 and we

will coordinate such suggestions with the Process Reform proceeding. Commenters should suggest ways

we can further streamline our processes to make it easier for regulatory fee payors. Commenters should

58 Our proposal would exclude these two categories from regulatory fees going forward, not just for FY 2014.

59 47 U.S.C. § 159(b)(3).

60 47 U.S.C. § 159(b)(4)(B).

61 See, e.g., Table 1 at para. 18.

62 See Assessment and Collection of Regulatory Fees for Fiscal Year 1997, Report and Order, 12 FCC 17161,

17176, para. 37 (1997).

63 This cap would apply to an increase to an entire fee category as a result of FTE reallocations or reform measures;

such cap would not apply to limit changes in regulatory fees for a particular payor resulting from other factors, such

as increased or decreased revenues, changes in subscriber numbers, number of licenses, etc.

For example, UHF

television fees in Markets 1-10 will increase from $38,000 (FY 2013) to $44,875 (FY 2014) as a result of our

regulatory reform measure in combining the UHF and VHF fee categories.

64 http://transition.fcc.gov/Daily_Releases/Daily_Business/2014/db0214/DA-14-199A2.pdf.

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also address the timing of our annual regulatory fee process. Commenters should suggest ways in which

we could improve our website to make it easier for the public to obtain information about regulatory fees.

We propose making regulatory fee waiver decisions public and accessible on our website. We seek

comment on the feasibility of an automated online waiver process. We seek comment on other ways to

make information more accessible on the Commission’s website.

F.

Combining Existing Regulatory Fee Categories

36.

In the FY 2013 NPRM, the Commission sought comment on combining wireline and

wireless voice services into one category and assessing regulatory fees based on voice revenues for this

new category.65 The Commission explained that because wireless services are comparable to wireline

services, both services encompass similar regulatory policies and programs, such as universal service and

number portability.66 The Independent Telephone and Telecommunications Alliance (ITTA) contends that

wireline companies bear a disproportionately high burden in regulatory fees because these companies no

longer require the same expenditure of Commission resources as when regulatory fees were first adopted.67

ITTA further observes that issues addressed by FTEs in the Wireline Competition Bureau also affect the

providers of other voice services, such as wireless and VoIP; for example, the Wireline Competition

Bureau oversees contributions to the universal service fund by wireless providers and programs that

benefit and provide disbursements to wireless providers, such as Lifeline, high-cost, and E-rate.68

37.

We seek comment on combining wireless cellular services with the ITSP category to

create one regulatory fee category whose regulatory fees are calculated based on the combined number of

FTEs in the Commission’s Wireline Competition Bureau and Wireless Telecommunications Bureau. We

also seek comment on whether we should combine any portion of other service categories with ITSP. Any

combination of categories proposed by commenters should address the need to reconcile different

assessment methodologies for ITSP, which pay fees based on revenues and wireless, which pay fees based

on handsets. If ITSP is combined with another category, a uniform method would need to be applied to

calculate the fees (e.g., revenues, subscribers, handsets, telephone numbers). Commenters should propose

and discuss uniform methods for calculating regulatory fees in a combined regulatory fee category.

Although revenues appear to be the most appealing methodology because this information is available in

FCC Form 499 filings and is already used in other FCC programs to determine obligations, such as

universal service contributions, commenters advocating using revenues for assessing regulatory fees in a

combination of categories should take into account whether all revenues should be assessed, or whether

only the proportion of revenues allocated to voice be used.69

65 FY 2013 NPRM, 28 FCC Rcd at 7796, para. 12. See, e.g., ITTA Comments at 2-3 (filed June 19, 2013). ITTA’s

proposal was also discussed in the FY 2008 FNPRM, 24 FCC Rcd at 6404-05, paras. 40-41. In that proceeding, the

Commission stated that “ITTA recommends that the Commission extend the process by which it added

interconnected Voice over Internet Protocol (‘VoIP’) providers to the ITSP category and also include wireless

providers in the ITSP category.” Id., 24 FCC Rcd at 6404, para. 40.

66 FY 2013 NPRM, 28 FCC Rcd at 7796, para. 12.

67 ITTA Comments at 4 (filed June 19, 2013).

68 47 C.F.R. § 54.706; Schools and Libraries Universal Support Mechanism, Eligible Services List, CC Docket No.

02-6, GN Docket No. 09-51, Order, 28 FCC Rcd 14534 (WCB 1993); Federal Communications Commission

Consumer Guide, Lifeline: Affordable Telephone Service for Income-Eligible Consumers (2013), available at

http://transition.fcc.gov/cgb/consumerfacts/lllu.pdf; Connect America Fund, et al., WC Docket No. 10-90, Report

and Order and Further Notice of Proposed Rulemaking, 26 FCC Rcd 17633 (2011), petitions for review pending sub

nom, In Re Federal Communications Commission 11-161, No. 11-9900 (10th Cir, filed Dec. 18, 2011).

69 Commenters advocating using revenues for assessing regulatory fees in a combination of services should take into

account that wireless carriers provide “voice” service without charge for customers with data plans.

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38.

Depending on the revenues that are included in the base, combining wireless cellular and

the historic ITSP fee categories together could result in a sizeable change in the wireline regulatory fee

rate. We seek comment on transitioning to a combined category and capping any increase to 7.5 or 10

percent, annually. If we combine the wireless cellular and ITSP fee categories into a new category as

proposed by ITTA, the effect of a cap on increases, and the reduction in fees for the wireline industry,

could cause significant fee increases for the remaining regulatory fee categories. Alternatively, we could

start our transition by keeping wireless and ITSP separate categories based on revenue and phasing in an

increase in wireless and decrease in ITSP fee rates before combining the two categories.70 We seek

comment on ways to transition to a combined wireless and wireline category without causing hardship on

the wireless industry and other fee categories.

39.

For example, if the cellular wireless and ITSP fee categories were combined into one fee

category based on 499-A revenues, the fee rate and collections amount would be projected as follows.

Table 3: Combined Wireless and ITSP Fee Rate and Projected Revenue (without cap)

Revenue Source

499-A Projected

Combined

Estim. Revenue

% of

Diff. Paid w/

(FCC Form 499-

Revenue

Rev.

Collected

Rev.

Combined

A 2013 Revenue)

2014 Fee Rate

Collected

Rate

ITSP

$38,800,000,000

.00287

$111,356,000

32.77%

($20,569,314)

Wireless

$27,715,500,000

.00287

$79,543,485

23.41%

$20,139,689

(Cellular)

Total

$66,515,500,000

$190,899,485

56.18%

Note: The combined revenue fee rate of .00287 was calculated on an ITSP allocation (FTE)

percentage of 38.60% and a cellular wireless percentage of 17.34%.

40.

We tentatively conclude that combining two fee categories into one new fee category

constitutes a reclassification of services in the regulatory fee schedule, and thus a permitted amendment as

defined in section 9(b)(3) of the Act,71 which pursuant to section 9(b)(4)(B) must be submitted to Congress

at least 90 days before it becomes effective.72

G.

New Regulatory Fee Categories

1.

DBS

41.

DBS providers are multichannel video programming distributors (MVPDs), pursuant to

section 522(13) of the Act. These operators of U.S.-licensed geostationary space stations used to provide

one way subscription television service to consumers in the United States pay a fee under the category

“Space Station (Geostationary Orbit)” in the regulatory fee schedule. Such providers of one-way

subscription satellite television service to consumers in the United States do not pay a per-subscriber

regulatory fee. DBS services are similar to cable services because both services offer multi-channel video

70 By way of illustration, if we capped the increase at 10%, the cellular wireless projected regulatory fee revenue

would increase from approximately $58.9M to $64.8M for FY 2014, to $71.3M for FY 2015, to $78.4M for FY

2016, to $86.2 for FY 2017, and to $94.9M for FY 2018, at which point the two categories would be combined into

one ITSP category. During this phase-in process, the wireline regulatory fee revenues would decrease each year,

from approximately $131.2M to $125.3M for FY 2014, to $118.8M for FY 2015, to $111.7M for FY 2016, to

$103.8M for FY 2017, and to $95.2M in FY 2018.

71 47 U.S.C. § 159(b)(3).

72 47 U.S.C. § 159(b)(4)(B).

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programming to end-users. DBS services, however, also differ from cable because programming is

transmitted to end users by satellites stationed in geosynchronous orbit and not by terrestrial cable.

42.

Commenters, in response to the FY 2013 NPRM, proposed that DBS providers pay

regulatory fees based on Media Bureau FTEs due to the similar regulatory work devoted to cable operators

and DBS providers.73 For example, DBS providers (and cable operators) are permitted to file program

access complaints74 and complaints seeking relief under the retransmission consent good faith rules;75 and

DBS providers are required to comply with Media Bureau oversight and regulation such as Commercial

Advertisement Loudness Mitigation Act (CALM Act),76 the Twenty-First Century Video Accessibility Act

(CVAA),77 and the closed captioning and video description rules.78 DBS providers argue, however, that

they are not cable television operators and they are not subject to all of the regulations historically imposed

on the cable industry by the Media Bureau; instead, their business model is based on satellite technology

and is subject to satellite licensing rules through the International Bureau.79

43.

We invite further comment on whether regulatory fees paid by DBS providers should be

included in the cable television and IPTV category and assessed in the same manner as cable television

system operators. We also seek comment on a new name for this category. For example, we invite

comment on whether “MVPD” or “subscription television fees” or other names would be appropriate for

this category. We also ask commenters to further address the impact of this on the cable industry and the

satellite industry.

Table 4: Change in cable/IPTV regulatory fees when DBS added

Fee Service

Subscriber

FY 14 Fee

FY 14 Fee

Projected

Projected

Diff. Paid

Count

Per

Not

Revenue

Rev. Not

with

Subscriber

Combined

Combined

Combined

Combined

Combined

Cable/IPTV

65,400,000

$.68

$1.00 per

$44,472,000

$65,400,000

($20,928,000)

Subscribers

subscriber

DBS

34,000,000

$.68

$114,025

$23,120,000

$2,052,450

$21,067,550

Subscribers

per satellite

Total

99,400,000

$67,592,000

$67,452,450

44.

When DBS video providers are included in the cable and IPTV subscriber count, the FY

2014 regulatory fee rate for cable television (and IPTV and DBS video service) reduces from a fee rate of

$1.00 per subscriber (cable and IPTV subscribers) to $.68 per subscriber. This would affect only the 18

satellites that provide video programming, EchoStar and DIRECTV. The GSO Space Stations will be

73 Previously, when this issue has been proposed by the cable industry, we declined to modify our methodology.

See, e.g., FY 2013 NPRM, 28 FCC Rcd at 7810-11, paras. 50-52; FY 2008 FNPRM, 24 FCC Rcd at 6407, para. 50.

For FY 2014, we adopted a new category that includes cable television and IPTV.

We now seek further comment

whether DBS providers should also be included in the cable television and IPTV category.

74 47 U.S.C. § 548; 47 C.F.R. § 76.1000-1004.

75 47 U.S.C. §§ 325(b)(1), (3)(C)(ii); 47 C.F.R. § 76.65(b).

76 See Implementation of the Commercial Advertisement, Loudness Mitigation (CALM) Act, Report and Order, 26

FCC Rcd 17222 (2011).

77 47 U.S.C. § 618(b).

78 47 C.F.R. Part 79.

79 See, e.g., DIRECTV Comments at 8-17 (filed June 19, 2013); EchoStar Corporation and DISH Network Reply

Comments at 4-6 (filed June 26, 2013).

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reduced by 18 satellites, and $2.5 million in projected revenue. This would add $2.5 million to cable’s

projected revenue, i.e., 34,000,000 new subscribers, totaling 99,400,000 subscribers.

45.

We also note that one-way satellite television subscription service is provided by a

variety of satellites in the United States.80 As a result, there are multiple definitions of DBS in our rules.81

Commenters should also explain how they would define DBS satellite television service providers for

regulatory fee purposes.

46.

Commenters should also discuss the relationship between regulatory fees that would be

paid by DBS satellite television service providers and the regulatory fees paid by operators of GSO

satellites, which are used to provide satellite television service to consumers in the United States. At the

same time, we recognize that non-U.S.-licensed satellites are also used to provide one-way satellite

television service to consumers in the United States, but do not pay a regulatory fee.82 Commenters may

wish to address this point in any discussion of the relationship between the two fee categories and the

impact of this fee category on the satellite industry.

2.

Non-U.S.-Licensed Space Stations Serving the United States

47.

To recover the costs associated with policy and rulemaking activities associated with

space stations, section 1.1156 of the Commission’s rules includes “Space Station (Geostationary Orbit)”

and “Space Stations (Non-Geostationary Orbit)” in the regulatory fee schedule.83 These fees are assessed

only for U.S.-licensed space stations. Regulatory fees are not assessed for non-U.S.-licensed space

stations that have been granted access to the market in the United States.84 We previously sought comment

on a proposal to assess regulatory fees on non-U.S.-licensed space stations that have been granted access to

the market in the United States and we incorporate that discussion by reference.85 Intelsat supports

creating this new category.86 Most commenters addressing this issue do not support assessing regulatory

fees on non-U.S.-licensed satellites and contend that the Commission does not have authority to do so;

such fees would conflict with international treaties; and that a fee assessment could lead to a proliferation

of fees from other countries that would have a serious impact on global satellite services.87

48.

We seek additional comment on whether regulatory fees should be assessed on non-U.S.

licensed space station operators granted access to the market in the United States. Commenters should

discuss whether the Commission should revisit the Commission’s 1999 conclusion that the regulatory fee

category for Space Stations (Geostationary Orbit) and Space Stations (Non-Geostationary Orbit) in section

80 For example, DIRECTV operates a number of Ka-band satellites used to provide satellite television services to

consumers in the United States in addition to its fleet of DBS satellites.

81 Compare definition of DBS in Section 25.103 used for satellite licensing with the definition for DBS in Section

25.701 used for other public interest obligations. 47 C.F.R. §§ 25.103, 25.701.

82 See, e.g., EchoStar Satellite, LLC, Order and Authorization, 20 FCC Rcd 20083 (International Bureau 2005).

83 47 C.F.R. §1.1156.

84 This issue was raised in the FY 1999 Report and Order where the Commission observed that that the legislative

history provides that only space stations licensed under Title III—which does not include non-U.S.-licensed satellite

operators—may be subject to regulatory fees. Assessment and Collection of Regulatory Fees for Fiscal Year 1999,

Report and Order, 14 FCC Rcd 9896, 9882, para. 39 (1999) (FY 1999 Report and Order).

85 See FY 2013 NPRM, 28 FCC Rcd at 7809-810, paras. 47-49.

86 Intelsat Comments (June 19, 2013).

87 See, e.g., EchoStar Corporation and DISH Network Comments at 15-18 (contending that the Commission lacks

the authority to impose such regulatory fees and that doing so would also be inconsistent with established

multilateral trade agreements) (June 19, 2013); SES Americom, Inc., Inmarsat, Inc., and Telesat Canada Comments

at 2-12) (June 19, 2013).

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1.1156(a) of the Commission’s rules covers only Title III license holders, including the Commission’s

finding that it “cannot include operators of non-U.S.-licensed satellite space stations among regulatory fee

payors.”88 Commenters should also discuss any negative policy implications that may arise from taking

such action, such as the likelihood that other countries will choose to assess fees on U.S.-licensed satellite

systems. Table 3 below illustrates the number of feeable (U.S. licensed) versus non-feeable (non-U.S.

licensed) satellites that require agency resources to be expended.

Table 5: Projected Number of Satellites that are Regulatory Feeable and Non-Feeable

Regulatory Feeable

Market Access List

K-Band List

ISAT List

Permitted List

Total

GSO & NGSO

(Not Feeable)

(Not Feeable)

(Not Feeable)

(Not Feeable)

(Not Feeable)

Satellites

100

19

6

6

38

69

49.

Commenters advocating the assessment of regulatory fees on non-U.S.-licensed space

stations granted access to the market in the United States should propose how the fees should be calculated

and applied. Because market access is granted through a variety of procedural mechanisms, commenters

should address each situation. For example, how would fees be calculated and applied in instances where

the non-U.S.-licensed space station operator accesses the U.S. market solely through grant of an

application by a U.S.-licensed earth station operator identifying the non-U.S. licensed space station as a

point of communication? Commenters should also provide specific information as to whether other

countries already assess fees in one form or another on U.S.-licensed satellite systems accessing their

markets.

50.

Based on Commission filings over the past three years, there were eleven applications

filed each year for U.S. space station authorization, eight applications per year to add a non-U.S.-licensed

space station to the Permitted List, and ten applications per year from U.S. earth stations to communicate

with non-U.S.-licensed space stations that are not on the Permitted List. Thus, over half of the space

station applications and notifications during this three year period pertained to non-U.S.-licensed space

stations. As Intelsat observes, “[t]he Satellite Division’s work on behalf of non-U.S.-licensed satellite

operators with U.S. market access generates regulatory costs.”89 As an alternative to adopting a new

regulatory fee category for non-U.S.-licensed space stations, as discussed above, FTEs working on

petitions or other matters involving non-U.S.-licensed satellites could be removed from the regulatory fee

assessments for U.S.-licensed satellites and considered indirect for regulatory fee purposes. We seek

comment on whether these FTEs should be considered indirect FTEs because their responsibilities

concerning non-U.S.-licensed satellite operators are of general benefit to the United States public, as well

as other entities, including the United States government, who uses these satellite services. Indirect

treatment may be further warranted because U.S. earth stations utilize these foreign satellites. We seek

comment on whether these FTEs should be considered “indirect” FTEs instead of direct International

Bureau FTEs.

3.

Toll free numbers

51.

We seek comment on whether toll free numbers, as defined in section 52.101(f) of our

rules,90 should be added to the regulatory fee schedule set forth in section 9. Toll free numbers are not

currently subject to regulatory fees. These numbers are managed by a RespOrg, or Responsible

88 FY 1999 Report and Order, 14 FCC Rcd at 9882, para. 39.

89 Intelsat Comments at 4 (June 19, 2013).

90 Toll free numbers are telephone numbers for which the toll charges for completed calls are paid by the toll free

subscriber. See 47 C.F.R. § 52.101(f).

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Organization, for toll free subscribers. Commission resources are used in enforcement activities,91 as well

as rulemakings and other policy making proceedings,92 pertaining to the use of these numbers.

Historically, the Commission has not assessed regulatory fees on toll free numbers, under the rationale

that the entities controlling the numbers, wireline and wireless carriers, were paying regulatory fees based

on either revenues or subscribers.93 This may no longer be a realistic assumption today as there appear to

be many toll free numbers controlled or managed by entities that are not carriers. We therefore seek

comment on whether we should assess regulatory fees on RespOrgs, for each toll free number managed

by a RespOrg. We seek comment on whether we should assess regulatory fees on working, assigned, and

reserved toll free numbers. In addition, should we assess regulatory fees 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?

Commenters should discuss an appropriate regulatory fee for this new category; e.g., one cent per month,

or twelve cents per year. Using this figure, the amount of fees collected could total approximately $4

million per year, depending on how many toll free numbers continued to be managed by RespOrgs if the

regulatory fee were to be imposed. The FTEs involved in toll free issues are primarily from the Wireline

Competition Bureau;94 therefore, this additional fee would reduce the ITSP regulatory fee total.

4.

Permitted Amendments

52.

We tentatively conclude that including the three categories discussed above: DBS, non-

U.S.-licensed space stations, and toll free numbers, in new or revised regulatory fee categories would

constitute a reclassification of services in the regulatory fee schedule as defined in section 9(b)(3) of the

Act,95 and pursuant to section 9(b)(4)(B) must be submitted to Congress at least 90 days before it becomes

effective.96

VII.

PROCEDURAL MATTERS

A.

Payment of Regulatory Fees

53.

In order to help regulatory fee payors better understand the process for payment of

regulatory fees, we restate important information below.

1.

Manner of Payment

54.

As of October 1, 2013, the Commission no longer accepts checks (including cashier’s

checks) and the accompanying hardcopy forms (e.g., Form 159’s, Form 159-B’s, Form 159-E’s, Form

159-W’s) for payment of regulatory fees. All payments must now be made by online ACH payment,

online credit card, or wire transfer. Any other form of payment (e.g., checks) will be rejected and sent

back to the payor. So that the Commission can associate the wire payment with the correct regulatory fee

information, an accompanying Form 159-E must still be transmitted via fax for wire transfers.97

91 See, e.g., Richard Jackowitz, IT Connect, Inc., Notice of Apparent Liability for Forfeiture, 29 FCC Rcd 3318

(2014); Richard Jackowitz, IT Connect, Inc., Notice of Apparent Liability for Forfeiture, 28 FCC Rcd 6692 (2013);

Telseven, LLC, et al., Notice of Apparent Liability for Forfeiture, 27 FCC Rcd 15558 (2013).

92 See, e.g., Toll Free Access Codes, Second Report and Order and Further Notice of Proposed Rulemaking, 12 FCC

Rcd 11162 (1997).

93 See generally, Universal Service Contribution Methodology, Further Notice of Proposed Rulemaking, 27 FCC

Rcd 5357, 5463-64, para. 306 (2012).

94 Enforcement Bureau staff also work on toll free issues.

95 47 U.S.C. § 159(b)(3).

96 47 U.S.C. § 159(b)(4)(B).

97 We incorporate this change into our rules at Attachment G.

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2.

Lock Box Bank

55.

All lock box payments to the Commission for FY 2014 will be processed by U.S. Bank,

St. Louis, Missouri, and payable to the FCC. During the fee season for collecting FY 2014 regulatory fees,

regulatees can pay their fees by credit card through Pay.gov,98 by ACH or debit card,99 or by wire transfer.

Additional payment options and instructions are posted at http://transition.fcc.gov/fees/regfees.html">http://transition.fcc.gov/fees/regfees.html.

3.

Receiving Bank for Wire Payments

56.

The receiving bank for all wire payments is the Federal Reserve Bank, New York, New

York (TREAS NYC). So that the processing bank can properly associate the wire payment with the fee

payment details, regulatees making a wire transfer must fax a copy of their Fee Filer generated Form 159-

E to U.S. Bank, St. Louis, Missouri at (314) 418-4232 at least one hour before initiating the wire transfer

(but on the same business day) so as not to delay crediting their account. The use of the Form 159-E is

permissible with wire transfer. 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">http://transition.fcc.gov/fees/wiretran.html.

4.

De Minimis Regulatory Fees

57.

Regulatees whose total FY 2014 regulatory fee liability, including all categories of fees

for which payment is due, is less than an established de minimis amount are exempted from payment of

FY 2014 regulatory fees. The de minimis amount to date has been $10 (ten dollars); however, such

amount could change as a result of this Notice.

5.

Standard Fee Calculations

58.

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, 2013 for AM/FM radio stations, VHF/UHF full service television

stations, and satellite television stations. Regulatory fees must be paid for all broadcast facility

licenses granted on or before October 1, 2013. In instances where a permit or license is

transferred or assigned after October 1, 2013, responsibility for payment rests with the holder of

the permit or license as of the fee due date.

Wireline (Common Carrier) Services: Regulatory fees must be paid for authorizations that were

granted on or before October 1, 2013. In instances where a permit or license is transferred or

98 In accordance with U.S. Treasury Financial Manual Announcement No. A-2012-02, the U.S. Treasury will reject

credit card transactions greater than $49,999.99 from a single credit card in a single day. This includes online

transactions conducted via Pay.gov, transactions conducted via other channels, and direct-over-the counter

transactions made at a U.S. Government facility.

Individual credit card transactions larger than the $49,999.99 limit

may not be split into multiple transactions using the same credit card, whether or not the split transactions are

assigned to multiple days. Splitting a transaction violates card network and Financial Management Service (FMS)

rules. However, credit card transactions exceeding the daily limit may be split between two or more different credit

cards.

Other alternatives for transactions exceeding the $49,999.99 credit card limit include payment by check,

electronic debit from your bank account, and wire transfer.

99 In accordance with U.S. Treasury Financial Manual Announcement No. A-2012-02, the maximum dollar-value

limit for debit card transactions will be eliminated. It should also be noted that only Visa and MasterCard branded

debit cards are accepted by Pay.gov.

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assigned after October 1, 2013, 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.100

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, 2013. The number of subscribers or telephone numbers on

December 31, 2013 will be used as the basis for calculating the fee payment. In instances where

a permit or license is transferred or assigned after October 1, 2013, responsibility for payment

rests with the holder of the permit or license as of the fee due date.

The first eleven regulatory fee categories in our Schedule of Regulatory Fees (see Attachment B)

pay “small multi-year wireless regulatory fees.” Entities pay these regulatory fees in advance

for the entire amount of their five-year or ten-year term of initial license, and only pay regulatory

fees again when the license is renewed or a new license is obtained. We include these fee

categories in our Schedule of Regulatory Fees to publicize our estimates of the number of “small

multi-year wireless” licenses that will be renewed or newly obtained in FY 2014.

Multichannel Video Programming Distributor Services (cable television operators and CARS

licensees) and Internet Protocol Television (IPTV): Regulatory fees must be paid for the number

of basic cable television subscribers as of December 31, 2013.101 In addition, beginning in FY

2014, IPTV providers that had subscribers as of December 31, 2013 are also obligated to pay

regulatory fees. Holders of CARS licenses that were granted on or before October 1, 2013 must

also pay regulatory fees. In instances where a permit or license is transferred or assigned after

October 1, 2013, 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 earth stations that were authorized

(licensed) on or before October 1, 2013. Geostationary orbit space stations and non-

geostationary orbit satellite systems that were licensed and operational on or before October 1,

2013 are subject to regulatory fees. In instances where a permit or license is transferred or

assigned after October 1, 2013, 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,

2013. In instances where a license is transferred or assigned after October 1, 2013,

responsibility for payment rests with the holder of the license as of the fee due date. For

regulatory fee purposes, the allocation in FY 2014 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 International

Bearer Circuits are to be paid by facilities-based common carriers that have active (used or

leased) international bearer circuits as of December 31, 2013 in any terrestrial or satellite

100 Audio bridging services are toll teleconferencing services.

101 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 2013, rather than on a count as

of December 31, 2013.

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transmission facility for the provision of service to an end user or resale carrier, which includes

active circuits to themselves or to their affiliates. In addition, non-common carrier satellite

operators must pay a fee for each circuit sold or leased to any customer, including themselves or

their affiliates, other than an international common carrier authorized by the Commission to

provide U.S. international common carrier services. “Active circuits” for these purposes include

backup and redundant circuits as of December 31, 2013. Whether circuits are used specifically

for voice or data is not relevant for purposes of determining that they are active circuits. In

instances where a permit or license is transferred or assigned after October 1, 2013,

responsibility for payment rests with the holder of the permit or license as of the fee due date.

For regulatory fee purposes, the allocation in FY 2014 will remain at 87.6 percent for submarine

cable and 12.4 percent for satellite/terrestrial facilities.

Clarification regarding DTV Replacement Translators. Because these TV translators do not

extend the coverage of the primary station, but operate solely within the primary station's

protected contour, these special TV translators are deemed to be "replacement translators" and

are not subject to a separate TV translator regulatory fee.

Clarification regarding TV Translator/Booster Facilities Operating in Analog, Digital, or in an

Analog/Digital Simulcast Mode. With respect to Low Power, Class A, and TV

Translator/Booster facilities that may be operating in analog, digital, or in an analog and digital

simulcast mode, the Commission assesses a fee for each facility operating either in an analog or

digital mode. In instances in which a licensee is simulcasting in both analog and digital modes,

a single regulatory fee will be assessed for the analog facility and its corresponding digital

component, but not for both facilities.

B.

Enforcement

59.

To be considered timely, regulatory fee payments must be received and stamped at the

lockbox bank by the due date of regulatory fees. Section 9(c) of the Act requires us to impose a late

payment penalty of 25 percent of the unpaid amount to be assessed on the first day following the deadline

date for filing of these fees.102 Failure to pay regulatory fees and/or any late penalty will subject regulatees

to sanctions, including those set forth in section 1.1910 of the Commission’s rules103 and in the Debt

Collection Improvement Act of 1996 (DCIA).104 We also assess administrative processing charges on

delinquent debts to recover additional costs incurred in processing and handling the related debt pursuant

to the DCIA and section 1.1940(d) of the Commission’s rules.105 These administrative processing charges

will be assessed on any delinquent regulatory fee, in addition to the 25 percent late charge penalty. In case

of partial payments (underpayments) of regulatory fees, the payor will be given credit for the amount paid,

but if it is later determined that the fee paid is incorrect or not timely paid, then the 25 percent late charge

penalty (and other charges and/or sanctions, as appropriate) will be assessed on the portion that is not paid

in a timely manner.

60.

We will withhold action on any applications or other requests for benefits filed by anyone

who is delinquent in any non-tax debts owed to the Commission (including regulatory fees) and will

102 47 U.S.C. § 159(c).

103 See 47 C.F.R. § 1.1910.

104 Delinquent debt owed to the Commission triggers application of the “red light rule” which requires offsets or

holds on pending disbursements. 47 C.F.R. § 1.1910. In 2004, the Commission adopted rules implementing the

requirements of the DCIA. See Amendment of Parts 0 and 1 of the Commission’s Rules, MD Docket No. 02-339,

Report and Order, 19 FCC Rcd 6540 (2004); 47 C.F.R. Part 1, Subpart O, Collection of Claims Owed the United

States.

105 47 C.F.R. § 1.1940(d).

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ultimately dismiss those applications or other requests if payment of the delinquent debt or other

satisfactory arrangement for payment is not made.106 Failure to pay regulatory fees may also result in the

initiation of a proceeding to revoke any and all authorizations held by the entity responsible for paying the

delinquent fee(s).

C.

Initial Regulatory Flexibility Analysis

61.

An initial regulatory flexibility analysis (IRFA) is contained in Attachment E. Comments

to the IRFA must be identified as responses to the IRFA and filed by the deadlines for comments on the

Notice. The Commission will send a copy of the Notice, including the IRFA, to the Chief Counsel for

Advocacy of the Small Business Administration.

D.

Initial Paperwork Reduction Act of 1995 Analysis

62.

This document solicits possible proposed information collection requirements. The

Commission, as part of its continuing effort to reduce paperwork burdens, invites the general public and

the Office of Management and Budget (OMB) to comment on the possible proposed information collection

requirements contained in this document, as required by the Paperwork Reduction Act of 1995, Public

Law 104-13. In addition, pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-

198, see 44 U.S.C. 3506(c)(4), we seek specific comment on how we might further reduce the information

collection burden for small business concerns with fewer than 25 employees.

E.

Filing Instructions

63.

Pursuant to sections 1.415 and 1.419 of the Commission’s rules, 47 C.F.R. §§ 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://fjallfoss.fcc.gov/ecfs2/">http://fjallfoss.fcc.gov/ecfs2/.

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.

o

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.

o

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.

o

Commercial overnight mail (other than U.S. Postal Service Express Mail and

Priority Mail) must be sent to 9300 East Hampton Drive, Capitol Heights, MD

20743.

o

U.S. Postal Service first-class, Express, and Priority mail must be addressed to

445 12th Street, SW, Washington DC 20554.

106 See 47 C.F.R. §§ 1.1161(c), 1.1164(f)(5), and 1.1910.

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64.

People with Disabilities: To request materials in accessible formats for people with

disabilities (braille, large print, electronic files, audio format), send an e-mail to file://C:\Users\Thomas\AppData\Local\Microsoft\Windows\Temporary Internet Files\Content.IE5\AppData\Local\Microsoft\Windows\Temporary Internet Files\Content.IE5\Users\Mika.Savir\AppData\Local\Microsoft\Windows\Temporary Internet Files\AppData\Local\Microsoft\Windows\Temporary Internet Files\Content.IE5\Users\Roland.Helvajian\AppData\Local\Microsoft\Windows\Temporary Internet Files\Content.Outlook\Users\Mika.Savir\AppData\Local\Microsoft\Windows\Temporary Internet Files\Content.Outlook\Local Settings\Temporary Internet Files\Users\Mika.Savir\AppData\Local\Microsoft\Windows\Temporary Internet Files\AppData\Local\Microsoft\Windows\Temporary Internet Files\Content.IE5\Local Settings\Temporary Internet Files\AppData\Local\Microsoft\Windows\Temporary Internet Files\Content.IE5\Users\Mika.Savir\AppData\Local\Microsoft\Windows\Temporary Internet Files\Content.Outlook\204T2IWP\fcc504@fcc.gov">fcc504@fcc.gov or call

the Consumer & Governmental Affairs Bureau at 202-418-0530 (voice), 202-418-0432 (tty).

F.

Ex Parte Information

65.

The proceeding this Notice and Second Further Notice initiates shall be treated as a

“permit-but-disclose” proceeding in accordance with the Commission’s ex parte rules. 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 list all persons attending or otherwise participating in the meeting at

which the ex parte presentation was made, and 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

rule 1.1206(b). In proceedings governed by rule 1.49(f) 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.

VIII.

ORDERING CLAUSES

66.

Accordingly, IT IS ORDERED that, pursuant to Sections 4(i) and (j), 9, and 303(r) of

the Communications Act of 1934, as amended, 47 U.S.C. §§ 154(i), 154(j), 159, and 303(r), this Second

Further Notice of Proposed Rulemaking, Notice of Proposed Rulemaking, and Order ARE HEREBY

ADOPTED.

67.

IT IS FURTHER ORDERED that the Commission’s Consumer and Governmental

Affairs Bureau, Reference Information Center, SHALL SEND a copy of this Second Further Notice of

Proposed Rulemaking and Notice of Proposed Rulemaking, including the Initial Regulatory Flexibility

Analysis in Attachment E, to the Chief Counsel for Advocacy of the U.S. Small Business Administration.

FEDERAL COMMUNICATIONS COMMISSION

Marlene H. Dortch

Secretary

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ATTACHMENT A

Calculation of FY 2014 Revenue Requirements and Pro-Rata Fees

Regulatory fees for the categories shaded in gray are collected by the Commission in advance to

cover the term of the license and are submitted at the time the application is filed.

Fee Category

FY 2014

FY 2013

Pro-Rated

Computed

Rounded

Expected

Payment Units

Years

Revenue

FY 2014

New FY

New

FY 2014

Estimate

Revenue

2014

FY 2014

Revenue

Require-

Regulatory

Regula-

ment

Fee

tory Fee

PLMRS (Exclusive

1,700

10

560,000

578,582

34

35

595,000

Use)

PLMRS (Shared

30,000

10

2,250,000

2,768,930

9

10

3,000,000

use)

Microwave

17,000

10

2,640,000

2,727,603

16

15

2,550,000

218-219 MHz

5

10

3,750

4,133

83

85

4,250

(Formerly IVDS)

Marine (Ship)

5,200

10

655,000

909,201

17

15

780,000

GMRS

8,900

5

197,500

330,619

7

5

222,500

Aviation (Aircraft)

4,200

10

290,000

413,273

10

10

420,000

Marine (Coast)

300

10

156,750

165,309

55

55

165,000

Aviation (Ground)

450

10

135,000

165,309

37

35

157,500

Amateur Vanity

11,500

10

230,230

247,964

2.16

2.16

248,400

Call Signs

AM Class A

4a

67

1

286,000

276,418

4,126

4,125

276,375

AM Class B

4b

1,483

1

3,435,250

3,439,404

2,319

2,325

3,447,975

AM Class C

4c

882

1

1,201,500

1,227,453

1,392

1,400

1,234,800

AM Class D

4d

1,522

1

3,862,500

4,071,166

2,675

2,675

4,071,350

FM Classes A, B1

3,107

1

8,379,375

8,528,907

2,745

2,750

8,544,250

& C34e

FM Classes B, C,

3,139

1

10,597,500

10,461,550

3,333

3,325

10,437,175

C0, C1 & C24f

AM Construction

30

1

30,090

17,700

590

590

17,700

Permits

FM Construction

185

1

142,500

138,750

750

750

138,750

Permits1

Satellite TV

127

1

190,625

197,208

1,553

1,550

196,850

Satellite TV

3

1

2,880

3,944

1,315

1,325

3,975

Construction Permit

Digital TV Markets

138

1

6,235,725

6,193,664

44,882

44,875

6,192,750

1-10

Digital TV Markets

138

1

5,636,875

5,838,689

42,309

42,300

5,837,400

11-25

Digital TV Markets

182

1

4,965,225

4,931,531

27,096

27,100

4,932,200

26-50

Digital TV Markets

290

1

4,645,275

4,547,390

15,681

15,675

4,545,750

25

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Federal Communications Commission

FCC 14-88

Fee Category

FY 2014

FY 2013

Pro-Rated

Computed

Rounded

Expected

Payment Units

Years

Revenue

FY 2014

New FY

New

FY 2014

Estimate

Revenue

2014

FY 2014

Revenue

Require-

Regulatory

Regula-

ment

Fee

tory Fee

51-100

Digital TV

380

1

1,769,975

1,814,316

4,775

4,775

1,814,500

Remaining Markets

Digital TV

5

1

20,950

23,875

4,775

4,775

23,875

Construction

Permits1

Broadcast

25,800

1

254,000

315,533

12.23

10

258,000

Auxiliaries

LPTV/Translators/

3,830

1

1,527,250

1,577,667

412

410

1,570,300

Boosters/Class A

TV

CARS Stations

325

1

165,750

197,262

607

605

196,625

Cable TV Systems,

65,400,000

1

61,200,000

65,293,695

.9984

1.00

65,400,000

including IPTV

Interstate

$38,800,000,00

1

135,330,000

131,835,683

0.003398

0.00340

131,920,000

Telecommunication

0

Service Providers

CMRS Mobile

330,000,000

1

58,680,000

60,312,520

0.1828

0.18

59,400,000

Services

(Cellular/Public

Mobile)

CMRS Messag.

2,900,000

1

240,000

232,000

0.0800

0.080

232,000

Services

BRS

2

900

1

469,200

646,718

719

720

648,000

LMDS

190

1

86,700

136,529

719

720

136,800

Per 64 kbps Int’l

4,484

,000

1

1,032,277

1,073,199

.2393

.24

1,076,160

Bearer Circuits

Terrestrial

(Common) &

Satellite (Common

& Non-Common)

Submarine Cable

39.19

1

8,530,139

7,554,010

192,766

192,775

7,554,370

Providers (see chart

in Appendix C)3

Earth Stations

3,400

1

935,000

829,539

244

245

833,000

Space Stations

94

1

12,101,700

10,717,648

114,018

114,025

10,716,750

(Geostationary)

Space Stations

6

1

899,250

796,358

132,726

132,725

796,350

(Non-Geostationary

****** Total

339,965,741 341,541,247

340,598,280

Estimated Revenue

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FCC 14-88

Fee Category

FY 2014

FY 2013

Pro-Rated

Computed

Rounded

Expected

Payment Units

Years

Revenue

FY 2014

New FY

New

FY 2014

Estimate

Revenue

2014

FY 2014

Revenue

Require-

Regulatory

Regula-

ment

Fee

tory Fee

to be Collected

****** Total

339,844,000

339,844,000

339,844,000

Revenue

Requirement

121,741

1,697,247

754,280

Difference

1 The FM Construction Permit revenues and the VHF and UHF Construction Permit revenues were adjusted to set

the regulatory fee to an amount no higher than the lowest licensed fee for that class of service. The reductions in the

FM Construction Permit revenues are offset by increases in the revenue totals for FM radio stations. Similarly,

reductions in the VHF and UHF Construction Permit revenues are offset by increases in the revenue totals for VHF

and UHF television stations, respectively.

2 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, para. 6 (2004).

3 The chart at the end of Appendix B lists the submarine cable bearer circuit regulatory fees (common and non-

common carrier basis) that resulted from the adoption of the Submarine Cable Order.

4 The fee amounts listed in the column entitled “Rounded New FY 2013 Regulatory Fee” constitute a weighted

average media regulatory fee by class of service. The actual FY 2014 regulatory fees for AM/FM radio station are

listed on a grid located at the end of Attachment B.

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ATTACHMENT B

FY 2014 Schedule of Regulatory Fees

Regulatory fees for the categories shaded in gray are collected by the Commission in advance to cover the

term of the license and are submitted at the time the application is filed.

Annual

Fee Category

Regulatory Fee

(U.S. $'s)

PLMRS (per license) (Exclusive Use) (47 CFR part 90)

35

Microwave (per license) (47 CFR part 101)

15

218-219 MHz (Formerly Interactive Video Data Service) (per license) (47 CFR

85

part 95)

Marine (Ship) (per station) (47 CFR part 80)

15

Marine (Coast) (per license) (47 CFR part 80)

55

General Mobile Radio Service (per license) (47 CFR part 95)

5

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)

35

Amateur Vanity Call Signs (per call sign) (47 CFR part 97)

2.16

CMRS Mobile/Cellular Services (per unit) (47 CFR parts 20, 22, 24, 27, 80 and

.18

90)

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

720

27)

Local Multipoint Distribution Service (per call sign) (47 CFR, part 101)

720

AM Radio Construction Permits

590

FM Radio Construction Permits

750

Digital TV (47 CFR part 73) VHF and UHF Commercial

Markets 1-10

44,875

Markets 11-25

42,300

Markets 26-50

27,100

Markets 51-100

15,675

Remaining Markets

4,775

Construction Permits

4,775

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Annual

Fee Category

Regulatory Fee

(U.S. $'s)

Satellite Television Stations (All Markets)

1,550

Construction Permits – Satellite Television Stations

1,325

Low Power TV, Class A TV, TV/FM Translators & Boosters (47 CFR part 74)

410

Broadcast Auxiliaries (47 CFR part 74)

10

CARS (47 CFR part 78)

605

Cable Television Systems (per subscriber) (47 CFR part 76), Including IPTV

1.00

Interstate Telecommunication Service Providers (per revenue dollar)

.00340

Earth Stations (47 CFR part 25)

245

Space Stations (per operational station in geostationary orbit) (47 CFR part 25)

also includes DBS Service (per operational station) (47 CFR part 100)

114,025

Space Stations (per operational system in non-geostationary orbit) (47 CFR part

132,725

25)

International Bearer Circuits - Terrestrial/Satellites (per 64KB circuit)

.24

International Bearer Circuits - Submarine Cable

See Table Below

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FY 2014 SCHEDULE OF REGULATORY FEES: Maintain Allocation (continued)

FY 2014 RADIO STATION REGULATORY FEES

Population

AM Class

AM Class

AM

AM

FM Classes

FM Classes

Served

A

B

Class C

Class D

A, B1 & C3

B, C, C0, C1

& C2

<=25,000

$775

$645

$590

$670

$750

$925

25,001 – 75,000

$1,550

$1,300

$900

$1,000

$1,500

$1,625

75,001 – 150,000

$2,325

$1,625

$1,200

$1,675

$2,050

$3,000

150,001 – 500,000

$3,475

$2,750

$1,800

$2,025

$3,175

$3,925

500,001 – 1,200,000

$5,025

$4,225

$3,000

$3,375

$5,050

$5,775

1,200,001 – 3,000,00

$7,750

$6,500

$4,500

$5,400

$8,250

$9,250

>3,000,000

$9,300

$7,800

$5,700

$6,750

$10,500

$12,025

FY 2014 SCHEDULE OF REGULATORY FEES

International Bearer Circuits - Submarine Cable

Submarine Cable Systems

Fee amount

Address

(capacity as of December 31, 2013)

< 2.5 Gbps

FCC, International, P.O. Box

$12,050

979084, St. Louis, MO 63197-

9000

2.5 Gbps or greater, but less

than 5 Gbps

$24,100

FCC, International, P.O. Box

979084, St. Louis, MO 63197-

9000

5 Gbps or greater, but less than

10 Gbps

$48,200

FCC, International, P.O. Box

979084, St. Louis, MO 63197-

9000

10 Gbps or greater, but less

than 20 Gbps

$96,400

FCC, International, P.O. Box

979084, St. Louis, MO 63197-

9000

FCC, International, P.O. Box

20 Gbps or greater

$192,775

979084, St. Louis, MO 63197-

9000

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ATTACHMENT C

Sources of Payment Unit Estimates for FY 2014

In order to calculate individual service fees for FY 2014, we adjusted FY 2013 payment units for each

service to more accurately reflect expected FY 2014 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 Wireline Competition Bureau’s Trends in Telephone

Service and 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 2014

estimates with actual FY 2013 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 2014 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 2014 payment

units are based on FY 2013 actual payment units, it does not necessarily mean that our FY 2014 projection

is exactly the same number as in FY 2013. We have either rounded the FY 2014 number or adjusted it

slightly to account for these variables.

FEE CATEGORY

SOURCES OF PAYMENT UNIT ESTIMATES

Land Mobile (All), Microwave,

Based on Wireless Telecommunications Bureau (“WTB”)

218-219 MHz, Marine (Ship &

projections of new applications and renewals taking into

Coast), Aviation (Aircraft &

consideration existing Commission licensee data bases. Aviation

Ground), GMRS, Amateur

(Aircraft) and Marine (Ship) estimates have been adjusted to take

Vanity Call Signs, Domestic

into consideration the licensing of portions of these services on a

Public Fixed

voluntary basis.

CMRS Cellular/Mobile Services

Based on WTB projection reports, and FY 13 payment data.

CMRS Messaging Services

Based on WTB reports, and FY 13 payment data.

AM/FM Radio Stations

Based on CDBS data, adjusted for exemptions, and actual FY 2013

payment units.

Digital TV Stations

Based on CDBS data, adjusted for exemptions, and actual FY 2013

(Combined VHF/UHF units)

payment units.

AM/FM/TV Construction Permits

Based on CDBS data, adjusted for exemptions, and actual FY 2013

payment units.

LPTV, Translators and Boosters,

Based on CDBS data, adjusted for exemptions, and actual FY 2013

Class A Television

payment units.

Broadcast Auxiliaries

Based on actual FY 2013 payment units.

BRS (formerly MDS/MMDS)

Based on WTB reports and actual FY 2013 payment units.

LMDS

Based on WTB reports and actual FY 2013 payment units.

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Cable Television Relay Service

Based on data from Media Bureau’s COALS database and actual

(CARS) Stations

FY 2013 payment units.

Cable Television System

Based on publicly available data sources for estimated subscriber

Subscribers, Including IPTV

counts and actual FY 2013 payment units.

Subscribers

Interstate Telecommunication

Based on FCC Form 499-Q data for the four quarters of calendar

Service Providers

year 2013, the Wireline Competition Bureau projected the amount

of calendar year 2013 revenue that will be reported on 2014 FCC

Form 499-A worksheets in April, 2014.

Earth Stations

Based on International Bureau (“IB”) licensing data and actual FY

2013 payment units.

Space Stations (GSOs & NGSOs)

Based on IB data reports and actual FY 2013 payment units.

International Bearer Circuits

Based on IB reports and submissions by licensees, adjusted as

necessary.

Submarine Cable Licenses

Based on IB license information.

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ATTACHMENT D

Factors, Measurements, and Calculations That Determines 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 C.F.R. §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.

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ATTACHMENT E

Initial Regulatory Flexibility Analysis

1.

As required by the Regulatory Flexibility Act (RFA),107 the Commission prepared this

Initial Regulatory Flexibility Analysis (IRFA) of the possible significant economic impact on small entities

by the policies and rules proposed in this Notice of Proposed Rulemaking, Second Further Notice of

Proposed Rulemaking, and Order (FNPRM). 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

FNPRM. The Commission will send a copy of the FNPRM, including the IRFA, to the Chief Counsel for

Advocacy of the Small Business Administration (SBA).108 In addition, the FNPRM and IRFA (or

summaries thereof) will be published in the Federal Register.109

A.

Need for, and Objectives of, the Notice

2.

The FNPRM seeks comment concerning adoption and implementation of proposals to

reallocate regulatory fees to more accurately reflect the subject areas worked on by current Commission

FTEs for FY 2014. As such, we seek comment on, among other things, (1) adopting a regulatory fee

obligation for AM Expanded Band radio stations; (2) reallocating certain indirect FTEs in the

Enforcement Bureau and/or the Consumer & Governmental Affairs Bureau and certain direct FTEs in the

International Bureau; (3) periodically updating FTE allocations; (4) applying a 7.5 or 10 percent cap on

any regulatory fee increases for FY 2014; (5) improving the Commission’s website for regulatory fee

payors; (6) adopting a higher de minimis threshold to provide relief for small carriers; and (7) eliminating

certain regulatory fee categories.

4.

The FNPRM also seeks comment concerning adoption and implementation of proposals

which include: (1) combining Interstate Telecommunications Service Providers (ITSPs) with wireless

telecommunications services, or other services such as cable television services, and using revenues,

subscribers, telephone numbers, or another means as the basis for calculating regulatory fees; and (2)

creating new categories for non-U.S.-Licensed Space Stations; Direct Broadcast Satellite service; and toll

free numbers in our regulatory fee process. We invite comment on these topics to better inform the

Commission concerning whether and/or how these services should be assessed under our regulatory fee

methodology in future years.

II.

Legal Basis:

5.

This action, including publication of proposed rules, is authorized under Sections (4)(i) and

(j), 9, and 303(r) of the Communications Act of 1934, as amended.110

III.

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

Apply:

107 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), Pub. L. No. 104-121, Title II, 110 Stat. 847 (1996).

108 5 U.S.C. § 603(a).

109 Id.

110 47 U.S.C. §§ 154(i) and (j), 159, and 303(r).

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6.

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.111 The RFA

generally defines the term “small entity” as having the same meaning as the terms “small business,” “small

organization,” and “small governmental jurisdiction.”112

In addition, the term “small business” has the same

meaning as the term “small business concern” under the Small Business Act.113 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.114

7.

Small Businesses. Nationwide, there are a total of approximately 27.9 million small

businesses, according to the SBA.115

8.

Wired Telecommunications Carriers. 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. Census data for 2007 shows that there were 31,996 establishments that operated that year.

Of this total, 1,818 operated with more than 100 employees, and 30,178 operated with fewer than 100

employees.116 Thus, under this size standard, the majority of firms can be considered small.

9.

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 applicable

size standard under SBA rules is for Wired Telecommunications Carriers. Under that size standard, such a

business is small if it has 1,500 or fewer employees.117 According to Commission data, census data for 2007

shows that there were 31,996 establishments that operated that year. Of this total, 1,818 operated with more

than 100 employees, and 30,178 operated with fewer than 100 employees.118 The Commission estimates

that most providers of local exchange service are small entities that may be affected by the rules and policies

proposed in the FNPRM.

10.

Incumbent LECs. Neither the Commission nor the SBA has developed a small business

size standard specifically for incumbent local exchange services. The closest applicable size standard under

SBA rules is for the category Wired Telecommunications Carriers. Under that size standard, such a

business is small if it has 1,500 or fewer employees.119 According to Commission data, 1,307 carriers

reported that they were incumbent local exchange service providers.120 Of this total, an estimated 1,006

111 5 U.S.C. § 603(b)(3).

112 5 U.S.C. § 601(6).

113 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.”

114 15 U.S.C. § 632.

115 See SBA, Office of Advocacy, “Frequently Asked Questions,”

http://www.sba.gov/sites/default/files/FAQ_Sept_2012.pdf.

116 See id.

117 13 C.F.R. § 121.201, NAICS code 517110.

118 See id.

119 13 C.F.R. § 121.201, NAICS code 517110.

120 See Trends in Telephone Service, Federal Communications Commission, Wireline Competition Bureau, Industry

Analysis and Technology Division at Table 5.3 (Sept. 2010) (Trends in Telephone Service).

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have 1,500 or fewer employees and 301 have more than 1,500 employees.121 Consequently, the

Commission estimates that most providers of incumbent local exchange service are small businesses that

may be affected by the rules and policies proposed in the FNPRM.

11.

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 size standard under SBA rules is for the category Wired Telecommunications

Carriers. Under that size standard, such a business is small if it has 1,500 or fewer employees.122

According to Commission data, 1,442 carriers reported that they were engaged in the provision of either

competitive local exchange services or competitive access provider services.123 Of these 1,442 carriers, an

estimated 1,256 have 1,500 or fewer employees and 186 have more than 1,500 employees.124 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.125 In addition, 72 carriers have reported that they are Other Local Service

Providers.126 Of this total, 70 have 1,500 or fewer employees and two have more than 1,500 employees.127

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 adopted pursuant to the proposals in this FNPRM.

12.

Interexchange Carriers (IXCs). Neither the Commission nor the SBA has developed a

small business size standard specifically applicable to interexchange services. The applicable size standard

under SBA rules is for the Wired Telecommunications Carriers. Under that size standard, such a business is

small if it has 1,500 or fewer employees.128 According to Commission data, 359 companies reported that

their primary telecommunications service activity was the provision of interexchange services.129 Of this

total, an estimated 317 have 1,500 or fewer employees and 42 have more than 1,500 employees.130

Consequently, the Commission estimates that the majority of interexchange service providers are small

entities that may be affected by rules adopted pursuant to the FNPRM.

13.

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 size standard

under SBA rules is for the category Telecommunications Resellers. Under that size standard, such a

business is small if it has 1,500 or fewer employees.131 Census data for 2007 show that 1,523 firms

provided resale services during that year. Of that number, 1,522 operated with fewer than 1000 employees

121 Id.

122 13 C.F.R. § 121.201, NAICS code 517110.

123 See Trends in Telephone Service, at tbl. 5.3.

124 Id.

125 Id.

126 Id.

127 Id.

128 13 C.F.R. § 121.201, NAICS code 517110.

129 See Trends in Telephone Service, at tbl. 5.3.

130 Id.

131 13 C.F.R. § 121.201, NAICS code 517911.

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and one operated with more than 1,000.132 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.133 All 193 carriers have 1,500 or fewer employees and none have more than 1,500 employees.134

Consequently, the Commission estimates that the majority of prepaid calling card providers are small

entities that may be affected by rules adopted pursuant to the FNPRM.

14.

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.135 Census data for 2007 show that 1,523 firms provided resale services during that year. Of

that number, 1,522 operated with fewer than 1000 employees and one operated with more than 1,000.136

Under this category and the associated small business size standard, 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.137 Of this total, an estimated 211 have 1,500 or fewer

employees and two have more than 1,500 employees.138 Consequently, the Commission estimates that the

majority of local resellers are small entities that may be affected by rules adopted pursuant to the proposals

in this FNPRM.

15.

Toll 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.139 Census data for 2007 show that 1,523 firms provided resale services during that year. Of

that number, 1,522 operated with fewer than 1,000 employees and one operated with more than 1,000.140

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.141 Of this total, an estimated 857 have 1,500 or fewer

employees and 24 have more than 1,500 employees.142 Consequently, the Commission estimates that the

majority of toll resellers are small entities that may be affected by our proposals in the FNPRM.

16.

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 size standard under SBA rules is

for Wired Telecommunications Carriers. Under that size standard, such a business is small if it has 1,500 or

132 Id.

133 See Trends in Telephone Service, at tbl. 5.3.

134 Id.

135 13 C.F.R. § 121.201, NAICS code 517911.

136 Id.

137 See Trends in Telephone Service, at tbl. 5.3.

138 Id.

139 13 C.F.R. § 121.201, NAICS code 517911.

140 Id.

141 Trends in Telephone Service, at tbl. 5.3.

142 Id.

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fewer employees.143 Census data for 2007 shows that there were 31,996 establishments that operated that

year. Of this total, 1,818 operated with more than 100 employees, and 30,178 operated with fewer than 100

employees.144 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.145 Of these, an

estimated 279 have 1,500 or fewer employees and five have more than 1,500 employees.146 Consequently,

the Commission estimates that most Other Toll Carriers are small entities that may be affected by the rules

and policies adopted pursuant to the FNPRM.

17.

Wireless Telecommunications Carriers (except Satellite). Since 2007, the SBA has

recognized wireless firms within this new, broad, economic census category.147 Prior to that time, such

firms were within the now-superseded categories of Paging and Cellular and Other Wireless

Telecommunications.148 Under the present and prior categories, the SBA has deemed a wireless business to

be small if it has 1,500 or fewer employees.149 For this category, census data for 2007 show that there were

11,163 establishments that operated for the entire year.150 Of this total, 10,791 establishments had

employment of 999 or fewer employees and 372 had employment of 1000 employees or more.151 Thus,

under this category and the associated small business size standard, the Commission estimates that the

majority of wireless telecommunications carriers (except satellite) are small entities that may be affected by

our proposed action.

18.

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) Telephony services.152 Of this total, an estimated 261 have 1,500 or

fewer employees and 152 have more than 1,500 employees.153 Consequently, the Commission estimates

that approximately half or more of these firms can be considered small. Thus, using available data, we

estimate that the majority of wireless firms can be considered small.

19.

Cable Television and other Program Distribution. Since 2007, these services have

been defined within the broad economic census category of Wired Telecommunications Carriers; that

143 13 C.F.R. § 121.201, NAICS code 517110.

144 Id.

145 Trends in Telephone Service, at tbl. 5.3.

146 Id.

147 13 C.F.R. § 121.201, NAICS code 517210.

148 U.S. Census Bureau, 2002 NAICS Definitions, “517211 Paging,” available at http://www.census.gov/cgibin/

sssd/naics/naicsrch?code=517211&search=2002%20NAICS%20Search; U.S. Census Bureau, 2002 NAICS

Definitions, “517212 Cellular and Other Wireless Telecommunications,” available at http://www.census.gov/cgi-

bin/sssd/naics/naicsrch?code=517212&search=2002%20NAICS%20Search.

149 13 C.F.R. § 121.201, NAICS code 517210. The now-superseded, pre-2007 C.F.R. citations were 13 C.F.R. §

121.201, NAICS codes 517211 and 517212 (referring to the 2002 NAICS).

150 U.S. Census Bureau, Subject Series: Information, Table 5, “Establishment and Firm Size: Employment Size of

Firms for the United States: 2007 NAICS Code 517210” (issued Nov. 2010).

151 Id. Available census data do not provide a more precise estimate of the number of firms that have employment of

1,500 or fewer employees; the largest category provided is for firms with “100 employees or more.”

152 Trends in Telephone Service, at tbl. 5.3.

153 Id.

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category is defined as follows: “This 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 a combination of technologies.”154 The SBA has

developed a small business size standard for this category, which is: all such firms having 1,500 or fewer

employees.155 Census data for 2007 shows that there were 31,996 establishments that operated that year.

Of this total, 1,818 had more than 100 employees, and 30,178 operated with fewer than 100 employees.

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 adopted pursuant to the FNPRM.

20.

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.156 Industry data indicate that, of 1,076

cable operators nationwide, all but eleven are small under this size standard.157

In addition, under the

Commission’s rules, a “small system” is a cable system serving 15,000 or fewer subscribers.158 Industry

data indicate that, of 6,635 systems nationwide, 5,802 systems have under 10,000 subscribers, and an

additional 302 systems have 10,000-19,999 subscribers.159 Thus, under this second size standard, most

cable systems are small and may be affected by rules adopted pursuant to the FNPRM.

21.

All Other Telecommunications. The Census Bureau defines this industry as including

“establishments 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.”160 The SBA has developed a small business size standard for this category; that size standard

is $30.0 million or less in average annual receipts.161 According to Census Bureau data for 2007, there were

154 U.S. Census Bureau, 2007 NAICS Definitions, “517110 Wired Telecommunications Carriers” (partial

definition), available at http://www.census.gov/cgi-

bin/sssd/naics/naicsrch?code=517110&search=2007%20NAICS%20Search.

155 13 C.F.R. § 121.201, NAICS code 517110.

156 See 47 C.F.R. § 76.901(e). The Commission determined that this size standard equates approximately to a size

standard of $100 million or less in annual revenues. See Implementation of Sections of the 1992 Cable Television

Consumer Protection and Competition Act: Rate Regulation, MM Docket Nos. 92-266, 93-215, Sixth Report and

Order and Eleventh Order on Reconsideration, 10 FCC Rcd 7393, 7408, para. 28 (1995).

157 These data are derived from R.R. BOWKER, BROADCASTING & CABLE YEARBOOK 2006, “Top 25

Cable/Satellite Operators,” pages A-8 & C-2 (data current as of June 30, 2005); WARREN COMMUNICATIONS

NEWS, TELEVISION & CABLE FACTBOOK 2006, “Ownership of Cable Systems in the United States,” pages

D-1805 to D-1857.

158 See 47 C.F.R. § 76.901(c).

159 WARREN COMMUNICATIONS NEWS, TELEVISION & CABLE FACTBOOK 2006, “U.S. Cable Systems

by Subscriber Size,” page F-2 (data current as of Oct. 2007). The data do not include 851 systems for which

classifying data were not available.

160 U.S. Census Bureau, “2007 NAICS Definitions: 517919 All Other Telecommunications,” available at

http://www.census.gov/cgi-bin/sssd/naics/naicsrch?code=517919&search=2007%20NAICS%20Search.

161 13 C.F.R. § 121.201, NAICS code 517919.

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2,623 firms in this category that operated for the entire year.162 Of this total, 2478 establishments had annual

receipts of under $10 million and 145 establishments had annual receipts of $10 million or more.163

Consequently, we estimate that the majority of these firms are small entities that may be affected by our

action in this FNPRM.

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

22.

This FNPRM seeks comment on changes to the Commission’s current regulatory fee

methodology and schedule which may result in additional information collection, reporting, and

recordkeeping requirements. Specifically, the FNPRM seeks comment on combining fee categories and

possibly using revenues or some other means to calculate regulatory fees. If a revenue-based option is

adopted, this may require entities that do not currently file a Form 499-A to provide the Commission with

revenue information. The FNPRM seeks comment on using subscribers, telephone numbers, or another

method of calculating regulatory fees, which may involve additional recordkeeping, if such proposals are

adopted. The FNPRM also seeks comment on adding categories to our regulatory fee schedule by changing

the treatment of non-U.S.-Licensed Space Stations; Direct Broadcast Satellite; and toll free number

subscribers in our regulatory fee process. If adopted, those entities that currently do not pay regulatory

fees, such as non-U.S.-Licensed Space Stations and toll free number subscribers, would be required to pay

regulatory fees to the Commission and DBS providers would pay regulatory fees in a different category.

The FNPRM also seeks comment on increasing our de minimis threshold and eliminating certain fee

categories, which, if adopted, would result in more carriers not paying regulatory fees to the Commission.

V. Steps Taken to Minimize Significant Economic Impact on Small Entities, and Significant

Alternatives Considered

23.

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.164

24.

With respect to reporting requirements, the Commission is aware that some of the

proposals under consideration will impact small entities by imposing costs and administrative burdens if

these entities will be required to calculate regulatory fees under a different methodology. For example, if

the Commission were to adopt a revenue-based approach for calculating regulatory fees, certain entities that

currently do not report revenues to the Commission—or that only report some revenues and not others—

may have to report such information.

25.

This FNPRM seeks to reform the regulatory fee methodology. We specifically seek

comment on ways to lessen the regulatory fee burden on small companies by, for example, adopting a

higher de minimis threshold or exempting certain categories from regulatory fees. We also seek comment

on ways to improve the regulatory fee process for companies that have difficulty with the Commission’s

rules, by, for example, improving our website.

162 U.S. Census Bureau, 2007 Economic Census, Subject Series: Information, Table 4, “Establishment and Firm

Size: Receipts Size of Firms for the United States: 2007 NAICS Code 517919” (issued Nov. 2010).

163 Id.

164 5 U.S.C. § 603(c)(1)–(c)(4).

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26.

It is possible that some of our proposals, if adopted, would result in increasing or

imposing a regulatory fee burden on small entities. For example, our reallocations, if adopted, may result

in higher regulatory fees for certain categories of regulatory fee payors. We anticipate that if that should

occur the increase would be minimal and we intend to mitigate any inequities that might result from such

increases, by, for example, limiting the annual increase. In keeping with the requirements of the Regulatory

Flexibility Act, we have considered certain alternative means of mitigating the effects of fee increases to a

particular industry segment. The FNPRM seeks comment on capping any regulatory fee increases at 7.5 or

10 percent. This FNPRM also proposes adopting a higher de minimis standard to exempt the smaller

entities from paying any regulatory fees and to eliminate certain regulatory fee categories entirely. The

Commission seeks comment on the abovementioned, and any other, means and methods that would

minimize any significant economic impact of our proposed rules on small entities.

VI. Federal Rules that May Duplicate, Overlap, or Conflict with the Proposed Rules

27.

None.

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ATTACHMENT F

Revised FTE (as of 9/30/12) Allocations,

Fee Rate Increases Capped at 7.5%

FY 2013 Schedule of Regulatory Fees

Regulatory fees for the categories shaded in gray are collected by the Commission in advance to cover the

term of the license and are submitted at the time the application is filed.

Annual

Fee Category

Regulatory

Fee

(U.S. $'s)

PLMRS (per license) (Exclusive Use) (47 CFR part 90)

40

Microwave (per license) (47 CFR part 101)

20

218-219 MHz (Formerly Interactive Video Data Service) (per license) (47 CFR part

75

95)

Marine (Ship) (per station) (47 CFR part 80)

10

Marine (Coast) (per license) (47 CFR part 80)

55

General Mobile Radio Service (per license) (47 CFR part 95)

5

Rural Radio (47 CFR part 22) (previously listed under the Land Mobile category)

15

PLMRS (Shared Use) (per license) (47 CFR part 90)

15

Aviation (Aircraft) (per station) (47 CFR part 87)

10

Aviation (Ground) (per license) (47 CFR part 87)

15

Amateur Vanity Call Signs (per call sign) (47 CFR part 97)

1.61

CMRS Mobile/Cellular Services (per unit) (47 CFR parts 20, 22, 24, 27, 80 and 90)

.18

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)

510

Local Multipoint Distribution Service (per call sign) (47 CFR, part 101)

510

AM Radio Construction Permits

590

FM Radio Construction Permits

750

TV (47 CFR part 73) VHF Commercial

Markets 1-10

86,075

Markets 11-25

78,975

Markets 26-50

42,775

Markets 51-100

22,475

Remaining Markets

6,250

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Annual

Fee Category

Regulatory

Fee

(U.S. $'s)

Construction Permits

6,250

TV (47 CFR part 73) UHF Commercial

Markets 1-10

38,000

Markets 11-25

35,050

Markets 26-50

23,550

Markets 51-100

13,700

Remaining Markets

3,675

Construction Permits

3,675

Satellite Television Stations (All Markets)

1,525

Construction Permits – Satellite Television Stations

960

Low Power TV, Class A TV, TV/FM Translators & Boosters (47 CFR part 74)

410

Broadcast Auxiliaries (47 CFR part 74)

10

CARS (47 CFR part 78)

510

Cable Television Systems (per subscriber) (47 CFR part 76)

1.02

Interstate Telecommunication Service Providers (per revenue dollar)

.00347

Earth Stations (47 CFR part 25)

275

Space Stations (per operational station in geostationary orbit) (47 CFR part 25) also

includes DBS Service (per operational station)

139,100

Space Stations (per operational system in non-geostationary orbit) (47 CFR part 25)

149,875

International Bearer Circuits - Terrestrial/Satellites (per 64KB circuit)

.27

International Bearer Circuits - Submarine Cable

See Table

Below

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FY 2013 SCHEDULE OF REGULATORY FEES: Fee Rate Increases Capped at 7.5%

(continued)

FY 2013 RADIO STATION REGULATORY FEES

Population

AM Class

AM Class

AM

AM

FM Classes

FM Classes

Served

A

B

Class C

Class D

A, B1 & C3

B, C, C0, C1

& C2

<=25,000

$775

$645

$590

$670

$750

$925

25,001 – 75,000

$1,550

$1,300

$900

$1,000

$1,500

$1,625

75,001 – 150,000

$2,325

$1,625

$1,200

$1,675

$2,050

$3,000

150,001 – 500,000

$3,475

$2,750

$1,800

$2,025

$3,175

$3,925

500,001 – 1,200,000

$5,025

$4,225

$3,000

$3,375

$5,050

$5,775

1,200,001 – 3,000,00

$7,750

$6,500

$4,500

$5,400

$8,250

$9,250

>3,000,000

$9,300

$7,800

$5,700

$6,750

$10,500

$12,025

FY 2013 SCHEDULE OF REGULATORY FEES: Fee Rate Increases

Capped at 7.5%

International Bearer Circuits - Submarine Cable

Submarine Cable Systems

Fee amount

Address

(capacity as of December 31, 2012)

FCC, International, P.O. Box

< 2.5 Gbps

$13,600

979084, St. Louis, MO 63197-

9000

2.5 Gbps or greater, but less

FCC, International, P.O. Box

than 5 Gbps

$27,200

979084, St. Louis, MO 63197-

9000

5 Gbps or greater, but less than

FCC, International, P.O. Box

10 Gbps

$54,425

979084, St. Louis, MO 63197-

9000

10 Gbps or greater, but less

FCC, International, P.O. Box

than 20 Gbps

$108,850

979084, St. Louis, MO 63197-

9000

FCC, International, P.O. Box

20 Gbps or greater

$217,675

979084, St. Louis, MO 63197-

9000

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ATTACHMENT G

PART 1 – PRACTICE AND PROCEDURE

1. The authority citation for Part 0 continues to read as follows:

Authority: Secs. 5, 48 Stat. 1068, as amended; 47 U.S.C. 155.

2. Section 1.1112(a) is amended to read as follows:

§ 1.1112 Form of payment.

(a) Annual and multiple year regulatory fees must be paid electronically as described below in Section

1.1112(e). Fee payments, other than annual and multiple year regulatory fee payments, should be in the

form of a check, cashier’s check, or money order denominated in U.S. dollars and drawn on a United

States financial institution and made payable to the Federal Communications Commission or by a Visa,

MasterCard, American Express, or Discover credit card. No other credit card is acceptable. Fees for

applications and other filings paid by credit card will not be accepted unless the credit card section of

FCC Form 159 is completed in full. The Commission discourages applicants from submitting cash and

will not be responsible for cash sent through the mail. Personal or corporate checks dated more than six

months prior to their submission to the Commission's lockbox bank and postdated checks will not be

accepted and will be returned as deficient. Third party checks (i.e., checks with a third party as maker or

endorser) will not be accepted.

3. Paragraph (a)(1) is renumbered paragraph (a)(2), paragraph (a)(2) is renumbered paragraph (a)(3), and

a new paragraph (a)(1) is added, to read as follows:

(1) Although payments (other than annual and multiple year regulatory fee payments) may be

submitted in the form of a check, cashier’s check, or money order, payors of these fees are encouraged to

submit these payments electronically under the procedures described in Section 1.1112 (e).

4. Paragraph (a)(3) is renumbered paragraph (a)(4), and is amended to read as follows:

(4) To insure proper credit, applicants making wire transfer payments must follow the instructions

set out in the appropriate Bureau/Office fee filing guide.

5.

Paragraph (b) is amended to read as follows:

(b) Applicants are required to submit one payment instrument (check, cashier’s check, or money order)

and FCC Form 159 with each application or filing; multiple payment instruments for a single application

or filing are not permitted. A separate Fee Form (FCC Form 159) will not be required once the

information requirements of that form (the Fee Code, fee amount, and total fee remitted) are incorporated

into the underlying application form.

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6. Paragraph (e) is renumbered paragraph (f), paragraph (f) is renumbered paragraph (g), and a new

paragraph (e) is added, to read as follows:

(e) Annual and multiple year regulatory fee payments shall be submitted by online ACH payment, online

Visa, MasterCard, American Express, or Discover credit card payment, or wire transfer payment

denominated in U.S. dollars and drawn on a United States financial institution and made payable to the

Federal Communications Commission. No other credit card is acceptable. Any other form of payment

for regulatory fees (e.g., paper checks) will be rejected and sent back to the payor.

************

7. Section 1.1158 is amended to read as follows:

§ 1.1158 Form of payment for regulatory fees.

Any annual and multiple year regulatory fee payment must be submitted by online Automatic Clearing

House (ACH) payment, online Visa, MasterCard, American Express, or Discover credit card payment, or

wire transfer payment denominated in U.S. dollars and drawn on a United States financial institution and

made payable to the Federal Communications Commission. No other credit card is acceptable. Any

other form of payment for annual and multiple year regulatory fees (e.g., paper checks, cash) will be

rejected and sent back to the payor. The Commission will not be responsible for cash, under any

circumstances, sent through the mail.

8. Paragraph (a) is amended to read as follows:

(a) Payors making wire transfer payments must submit an accompanying FCC Form 159-E via facsimile.

* * * * *

9. Section 1.1161 (a) is amended to read as follows:

§1.1161 Conditional license grants and delegated authorizations.

(a)

Grant of any application or an instrument of authorization or other filing for which an annual or

multiple year regulatory fee is required to accompany the application or filing will be conditioned

upon final payment of the current or delinquent regulatory fees. Current annual and multiple year

regulatory fees must be paid electronically as described in Section 1.1112(e). For all other fees,

(e.g., application fees, delinquent regulatory fees) final payment shall mean receipt by the U.S.

Treasury of funds cleared by the financial institution on which the check, cashier’s check, or

money order is drawn. Electronic payments are considered timely when a wire transfer was

received by the Commission’s bank no later than 6:00 pm on the due date; confirmation to

pay.gov that a credit card payment was successful no later than 11:59 pm (EST) on the due date;

or confirmation an ACH was credited no later than 11:59 pm (EST) on the due date.

* * * * *

10. Section 1.1164 is amended to read as follows:

§ 1.1164 Penalties for late or insufficient regulatory fee payments.

Electronic payments are considered timely when a wire transfer was received by the Commission’s bank

no later than 6:00 pm on the due date; confirmation to pay.gov that a credit card payment was successful

no later than 11:59 pm (EST) on the due date; or confirmation an ACH was credited no later than 11:59

pm (EST) on the due date. In instances where a non-annual regulatory payment (i.e., delinquent payment)

is made by check, cashier’s check, or money order, a timely fee payment or installment payment is one

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received at the Commission's lockbox bank by the due date specified by the Commission or by the

Managing Director. Where a non-annual regulatory fee payment is made by check, cashier’s check, or

money order, a timely fee payment or installment payment is one received at the Commission’s lockbox

bank by the due date specified by the Commission or the Managing Director. Any late payment or

insufficient payment of a regulatory fee, not excused by bank error, shall subject the regulatee to a 25

percent penalty of the amount of the fee of installment payment which was not paid in a timely manner.

A payment will also be considered late filed if the payment instrument (check, money order, cashier’s

check, or credit card) is uncollectible.

47

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