Assessment and Collection of Regulatory Fees For Fiscal Year 2007, 24213-24238 [E7-8366]

Agencies

• FEDERAL COMMUNICATIONS COMMISSION

[Federal Register Volume 72, Number 84 (Wednesday, May 2, 2007)]
[Proposed Rules]
[Pages 24213-24238]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-8366]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 1

[MD Docket No. 07-81; FCC 07-55]


Assessment and Collection of Regulatory Fees For Fiscal Year 2007

AGENCY: Federal Communications Commission.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Commission will revise its Schedule of Regulatory Fees in 
order to recover the amount of regulatory fees that Congress has 
required it to collect for fiscal year 2007. Section 9 of the 
Communications Act of 1934, as amended, provides for the annual 
assessment and collection of regulatory fees under sections 9(b)(2) and 
9(b)(3), respectively, for annual ``Mandatory Adjustments'' and 
``Permitted Amendments'' to the Schedule of Regulatory Fees.

DATES: Comments are due May 3, 2007, and reply comments are due May 11, 
2007.

ADDRESSES: You may submit comments, identified by MD Docket No. 07-81, 
by any of the following methods:
     Federal eRulemaking Portal: https://www.regulations.gov. 
Follow the instructions for submitting comments.
     Federal Communications Commission's Web site: https://www.fcc.gov/cgb/ecfs. Follow the instructions for submitting comments.
     E-mail: ecfs@fcc.gov. Include MD Docket No. 07-81 in the 
subject line of the message.
     Mail: 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. U.S. Postal Service first-
class, Express, and Priority mail should be addressed to 445 12th 
Street, SW., Washington, DC 20554.

FOR FURTHER INFORMATION CONTACT: Roland Helvajian, Office of Managing 
Director at (202) 418-0444 or Rob Fream, Office of Managing Director at 
(202) 418-0408.

SUPPLEMENTARY INFORMATION:
    Adopted: April 16, 2007.
    Released: April 18, 2007.
    By the Commission:

Table of Contents

 
                                                              Paragraph
                          Heading                               number
 
I. Introduction............................................            1
II. Discussion.............................................            2
    A. FY 2007 Regulatory Fee Assessment Methodology.......            4
        1. Development of FY 2007 Regulatory Fees..........            4

[[Page 24214]]

 
            a. Calculation of Revenue and Fee Requirements.            4
            b. Additional Adjustments to Payment Units.....            5
        2. Commercial Mobile Radio Service (CMRS) Messaging            7
         Service...........................................
        3. Broadband Radio Service (BRS)/Educational                   8
         Broadband Service (EBS)...........................
        4. International Bearer Circuits...................            9
        5. Interconnected Voice over Internet Protocol                10
         Service Providers.................................
    B. Administrative and Operational Issues...............           11
        1. Use of Fee Filer................................           12
        2. Proposals for Notification and Collection of               13
         Regulatory Fees...................................
            a. Interstate Telecommunications Service                  15
             Providers (ITSPs).............................
            b. Satellite Space Station Licensees...........           17
            c. Additional Service Categories for Billing...           19
            d. Media Services Licensees....................           20
            e. Commercial Mobile Radio Service (CMRS)                 23
             Cellular and Mobile Services Assessments......
            f. Cable Television Subscribers................           28
        3. Streamlined Regulatory Fee Payment Process for             30
         Commercial Mobile Radio Service (CMRS) Cellular
         and Mobile Providers..............................
        4. Future Streamlining of the Regulatory Fee                  32
         Assessment and Collection Process.................
III. Procedural Matters....................................           33
    A. Payment of Regulatory Fees..........................           33
        1. De Minimis Fee Payment Liability................           33
        2. Standard Fee Calculations and Payment Dates.....           34
    B. Enforcement.........................................           35
    C. Initial Regulatory Flexibility Analysis.............           37
    D. Initial Paperwork Reduction Act of 1995 Analysis....           38
    E. Ex Parte Rules......................................           39
    F. Filing Requirements.................................           40
IV. Ordering Clauses.......................................           45
Attachments:
Attachment A Initial Regulatory Flexibility Analysis
Attachment B Sources of Payment Unit Estimates for FY 2007
Attachment C Calculation of Revenue Requirements and Pro-
 Rata Fees
Attachment D Proposed FY 2007 Schedule of Regulatory Fees
Attachment E Factors, Measurements, and Calculations that
 Determine Station Contours and Population Coverages
Attachment F FY 2006 Schedule of Regulatory Fees
 

I. Introduction

    1. In this Notice of Proposed Rulemaking (NPRM), we propose to 
collect $290,295,160 in regulatory fees for Fiscal Year (FY) 2007, 
pursuant to section 9 of the Communications Act of 1934, as amended 
(the Act). These fees are mandated by Congress and are collected to 
recover the regulatory costs associated with the Commission's 
enforcement, policy and rulemaking, user information, and international 
activities.\1\
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    \1\ 47 U.S.C. 159(a).
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II. Discussion

    2. In this NPRM, we seek comment on the development of FY 2007 
regulatory fees collected pursuant to section 9 of the Act. For FY 
2007, we tentatively propose to retain the established methods and 
policies that the Commission has used to collect section 9 regulatory 
fees since FY 2003. In addition to seeking comment on the assessment 
methodology, the Commission typically seeks comment on various 
administrative and operational issues affecting the collection of 
regulatory fees. For the FY 2007 regulatory fee cycle, we propose to 
retain the vast majority of the administrative measures used for 
notification, assessment and pre-billing of regulatory fees in previous 
years, such as generating pre-completed regulatory fee assessment forms 
for certain regulatees. Consistent with past practice, we seek comment 
on ways to improve the Commission's administrative processes for 
notifying entities of their regulatory fee obligations and collecting 
their payments. Finally, we seek comment on applying the same 
regulatory fee obligations applicable to interstate telecommunications 
providers to providers of interconnected voice over Internet Protocol 
services.
    3. The Commission is obligated to collect $290,295,160 in 
regulatory fees during FY 2007 to fund the Commission's operations. 
Consistent with our established practice, we intend to collect these 
regulatory fees in the August-September 2007 time frame in order to 
collect the required amount by the end of the fiscal year.

A. FY 2007 Regulatory Fee Assessment Methodology

1. Development of FY 2007 Regulatory Fees
a. Calculation of Revenue and Fee Requirements
    4. For our FY 2007 regulatory fee assessment, we propose to use 
essentially the same section 9 regulatory fee assessment methodology 
adopted for FY 2006. Each fiscal year, the Commission proportionally 
allocates the total amount that must be collected via section 9 
regulatory fees. The results of our proposed FY 2007 regulatory fee 
assessment methodology (including a comparison to the prior year's 
results) are contained in Appendix C. For FY 2007, we propose to use 
the receipts collected through the FY 2006 regulatory fees as the basis 
for calculating the amount the Commission must collect in FY 2007. To 
collect the $290,295,160 required by law, we propose to adjust the FY 
2006 amount downward by approximately 2.84 percent.\2\ Consistent with 
past practice,

[[Page 24215]]

we propose to divide the FY 2007 amount by the number of payment units 
in each fee category to determine the unit fee.\3\ As in prior years, 
for cases involving small fees (e.g., licenses that are renewed over a 
multiyear term), we propose to divide the resulting unit fee by the 
term of the license. We propose to round these unit fees consistent 
with the requirements of section 9(b)(2).
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    \2\ The percentage decrease of approximately 2.84 percent is 
based on the total amount of regulatory fees that was mandated by 
Congress to be collected in FY 2006, which included an amount of 
$288,771,000 in regulatory fees pursuant to section 9 of the 
Communications Act of 1934, as amended, and an additional 
$10,000,000 as required by section 3013 of the Deficit Reduction Act 
(Public Law 109-171). Together, the total amount of regulatory fees 
mandated by Congress to be collected in FY 2006 was $298,771,000. 
Also, the decrease in regulatory fee payments of approximately 2.84 
percent in FY 2007 is reflected in the revenue that is expected to 
be collected from each service category. Because this expected 
revenue is adjusted each year by the number of estimated payment 
units in a service category, and then adjusted for rounding, the 
actual fee will likely differ by an amount more or less than 2.84 
percent. For example, in industries where the number of payment 
units is declining, the per-unit regulatory fee amount for FY 2007 
may actually be more than the amount for FY 2006.
    \3\ In many instances, the regulatory fee amount is a flat fee 
per licensee or regulatee. However, in some instances the fee amount 
represents a per-unit fee (such as for International Bearer 
Circuits), a per-unit subscriber fee (such as for Cable, Commercial 
Mobile Radio Service (CMRS) Cellular/Mobile and CMRS Messaging), or 
a fee factor per revenue dollar (Interstate Telecommunications 
Service Provider fee). The payment unit is the measure upon which 
the fee is based, such as a licensee, regulatee, subscriber fee, 
etc.
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b. Additional Adjustments to Payment Units
    5. In calculating the FY 2007 regulatory fees proposed in 
Attachment D, we further adjusted the FY 2006 list of payment units 
(Attachment B) based upon licensee databases and industry and trade 
group projections. Whenever possible, we verified these estimates from 
multiple sources to ensure the accuracy of these estimates. In some 
instances, Commission licensee databases were used, while in other 
instances, actual prior year payment records and/or industry and trade 
association projections were used in determining the payment unit 
counts.\4\ Where appropriate, we adjusted and/or rounded our final 
estimates to take into consideration events that may impact the number 
of units for which regulatees submit payment, such as waivers and/or 
exemptions that may be filed in FY 2007, and fluctuations in the number 
of licensees or station operators due to economic, technical, or other 
reasons. Therefore, when we state that our estimated FY 2007 payment 
units are based on FY 2006 actual payment units, the number may have 
been rounded or adjusted slightly to account for these variables.
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    \4\ The databases we consulted include, but are not limited to, 
the Commission's Universal Licensing System (ULS), International 
Bureau Filing System (IBFS), Consolidated Database System (CDBS) and 
Cable Operations and Licensing System (COALS). We also consulted 
industry sources including, but not limited to, Television & Cable 
Factbook by Warren Publishing, Inc. and the Broadcasting and Cable 
Yearbook by Reed Elsevier, Inc., 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 and Annual CMRS Competition 
Report. For additional information on source material, see 
Attachment B.
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    6. Additional factors are considered in determining regulatory fees 
for AM and FM radio stations. These factors are facility attributes and 
the population served by the radio station. The calculation of the 
population served is determined by coupling current U.S. Census Bureau 
data with technical and engineering data, as detailed in Attachment E. 
Consequently, the population served, as well as the class and type of 
service (AM or FM), determines the regulatory fee amount to be paid.\5\
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    \5\ In addition, beginning in FY 2005, we established a 
procedure by which we set regulatory fees for AM and FM radio and 
VHF and UHF television Construction Permits each year at an amount 
no higher than the lowest regulatory fee in that respective service 
category. For example, the regulatory fee for a Construction Permit 
for an AM radio station will never be more than the regulatory fee 
for an AM Class C radio station serving a population of less than 
25,000.
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2. Commercial Mobile Radio Service (CMRS) Messaging Service
    7. Since FY 2003, the Commission has maintained the CMRS Messaging 
regulatory fee at the rate that was established in FY 2002 (i.e., $0.08 
per subscriber) to account for the messaging industry's declining 
subscriber base.\6\ We note that between FY 1997 and FY 2006, the CMRS 
Messaging subscriber base declined 79.7 percent from 40.8 million to 
8.3 million, respectively.\7\ We propose to continue the same approach 
for regulatory fees applicable to the messaging industry in FY 2007, 
thereby maintaining the industry's regulatory fee at $0.08 per 
subscriber. We seek comment on this proposal.
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    \6\ See Assessment and Collection of Regulatory Fees for Fiscal 
Year 2003, MD Docket No. 03-83, Report and Order, 18 FCC Rcd 15985, 
15992, para. 21 (2003).
    \7\ The 40.8 million number represents a unit estimate from 
Assessment and Collection of Regulatory Fees for Fiscal Year 1997, 
MD Docket No. 96-186, Report and Order, 12 FCC Rcd 17161 (1997), and 
the 8.3 million figure represents the number of paid units as of 
fiscal year end 2006.
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3. Broadband Radio Service (BRS)/Educational Broadband Service (EBS)
    8. Recently, the Commission adopted a megahertz-based formula for 
BRS licensees with tiered fees by markets, similar to but more complex 
than the Commission's annual scale of regulatory fees paid by broadcast 
television stations.\8\ According to this formula, annual fees will be 
charged on a per-megahertz basis based upon three categories of Basic 
Trading Areas (BTA) population rankings: \9\ Licensees in BTA rankings 
1-60 will pay the highest fee, licensees in BTA rankings 61-200 will 
pay a lesser fee, and licensees in BTA rankings 201-493 will pay the 
lowest fee.\10\ Because this formula is complex, we are assessing the 
impact of this methodology (using a per-megahertz formula and a BTA 
populating ranking) on the manner in which regulatory fees are 
calculated for this class of licensees. We seek comment on how to 
devise a simple method of calculating regulatory fees that incorporates 
BTA population rankings and a per-megahertz fee for future fiscal 
years. We specifically seek comment on a formula for calculating 
regulatory fees that not only incorporates BTAs and a per-megahertz 
fee, but a formula that is also sensitive to rural operators in less 
densely populated areas. We seek comment on this proposal. Due to the 
complexities mentioned above and the need for detailed analysis, 
however, we will not implement any such changes for FY 2007.
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    \8\ 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, Order on Reconsideration and 
Fifth Memorandum Opinion and Order and Third Memorandum Opinion and 
Order and Second Report and Order, 21 FCC Rcd 5606, 5756-5759, 
paras. 367-376 (2006) (BRS/EBS Second Report and Order).
    \9\ For BRS licensees that are licensed by geographic licensed 
service area (GSA), the BTA is the geographic center point of where 
its GSA is located.
    \10\ BRS/EBS Second Report and Order, 21 FCC Rcd 5759, para. 
376. (Generally, BTAs ranked 1-60 have a population greater than 1 
million, BTAs ranked 61-200 have a population 250,000 to 1 million, 
and BTAs ranked 201-493 have a population of less than 250,000.)
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4. International Bearer Circuits
    9. On February 6, 2006, VSNL Telecommunications (US) Inc. (VSNL) 
filed a Petition for Rulemaking urging the Commission to modify the 
current international bearer circuit fee rules and policies as applied 
to non-common carrier (i.e., private) submarine cable operators.\11\ We 
issued a Public Notice designating the proceeding as RM-11312 and 
requesting comment on the

[[Page 24216]]

Petition.\12\ We continue to review the record in that proceeding.
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    \11\ See Petition for Rulemaking of VSNL Telecommunications (US) 
Inc., RM-11312 (filed Feb. 6, 2006) (VSNL Petition).
    \12\ See Consumer and Governmental Affairs Bureau, Reference 
Information Center, Public Notice, Report No. 2759 (rel. Feb. 15, 
2006).
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5. Interconnected Voice Over Internet Protocol Service Providers
    10. We tentatively conclude that providers of interconnected voice 
over Internet Protocol (``VoIP'') service \13\ should pay regulatory 
fees. During FY 2006, the Commission concluded that providers of 
interconnected VoIP services should contribute to the Universal Service 
Fund.\14\ Based on section 9's broad mandate that the Commission 
``assess and collect regulatory fees to recover the costs'' of 
regulatory activities \15\ and our analysis in the 2006 Interim 
Contribution Methodology Order, we tentatively conclude that the 
Commission has the legal authority to extend regulatory fee obligations 
to interconnected VoIP service providers.\16\ We seek comment on 
whether we should assess regulatory fees on providers of interconnected 
VoIP services based on their revenue, which would be consistent with 
the regulatory fee methodology used for interstate telecommunications 
service providers, or whether we should assess regulatory fees using a 
numbers-based approach, which would be consistent with the methodology 
used for CMRS providers.
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    \13\ See 47 CFR 9.3 for the definition of interconnected VoIP 
service.
    \14\ See Universal Service Contribution Obligations for 
Providers of Interconnected Voice Over Internet Protocol (VoIP) 
Service, WC Docket No. 06-122, Report and Order and Notice of 
Proposed Rulemaking, 21 FCC Rcd 7518, 7541, para. 46 (2006) (2006 
Interim Contribution Methodology Order).
    \15\ 47 U.S.C. 159(1).
    \16\ See 2006 Interim Contribution Methodology Order 21 FCC Rcd 
at 7541, paras. 46-47 (finding that Title I gives the Commission 
subject matter jurisdiction over interconnected VoIP services and 
that imposition of a universal service contribution obligation is 
reasonably ancillary to effective performance of the Commission's 
obligations under section 254 of the Act). Here, the regulatory fee 
obligation would be reasonably ancillary to the Commission's 
obligations under section 9 of the Act.
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B. Administrative and Operational Issues

    11. We seek comment on the administrative and operational processes 
used to collect the annual section 9 regulatory fees. Although these 
issues do not affect the amount of regulatory fees parties are 
obligated to submit, the administrative and operational issues affect 
the process of submitting payment. We invite comment on ways to improve 
these processes.
1. Use of Fee Filer
    12. We continue to encourage regulatees to use the Commission's 
online electronic Fee Filer application. Using the Commission's Fee 
Filer application reduces paperwork burdens on payors because it 
eliminates the need to file a FCC Form 159. Regulatees submitting more 
than twenty-five (25) Form 159-Cs are strongly encouraged to use Fee 
Filer when sending their regulatory fee payment. We note that Fee Filer 
will accept credit card payments of up to $99,999.99.
2. Proposals for Notification and Collection of Regulatory Fees
    13. In this section, we seek comment on the administrative 
processes that the Commission uses to notify regulatees and collect 
regulatory fees. Each year, we generate public notices and fact sheets 
that notify regulatees of the fee payment due date and provide 
additional information regarding regulatory fee payment procedures. 
Consistent with our established practice, we propose to provide public 
notices, fact sheets and all other relevant material on our Web site at 
https://www.fcc.gov/fees/regfees.html for the FY 2007 regulatory fee 
cycle. Regulatees are then expected to pay their yearly regulatory fees 
by filing FCC Form 159 or by accessing the Commission's Fee Filer web 
application. As a general practice, we will not send regulatory fee 
material to regulatees via surface mail. However, in the event that 
regulatees do not have access to the Internet, we will mail public 
notices and other relevant material upon request. Regulatees and the 
general public may request such information by contacting the FCC 
Financial Operations HelpDesk at (877) 480-3201, Option 4. We seek 
comment on ways to improve our administrative processes.
    14. As discussed above, we do not send public notices and fact 
sheets to regulatees en masse. We propose, however, to continue to send 
specific regulatory fee pre-bills or assessment notifications via 
surface mail to the select fee categories discussed below.\17\ Pre-
bills are hardcopy billing statements that the Commission mails to 
certain regulatees. Currently, the Commission only sends pre-bills to 
interstate telecommunications service providers (ITSPs) and satellite 
space station licensees. The remaining regulatees do not receive pre-
bills. We are pursuing our pre-billing initiatives as part of our 
effort to modernize our financial practices. These initiatives also 
provide licensees with notification of upcoming regulatory fees. We 
seek comment on expanding our pre-billing initiatives to include other 
regulatory fee service categories.
a. Interstate Telecommunications Service Providers (ITSPs)
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    \17\ An assessment is a proposed statement of the amount of 
regulatory fees owed by an entity to the Commission (or proposed 
subscriber count to be ascribed for purposes of setting the entity's 
regulatory fee) but it is not entered into the Commission's 
accounting system as a current debt. A pre-bill is considered an 
account receivable in the Commission's accounting system. Pre-bills 
reflect the amount owed and have a payment due date of the last day 
of the regulatory fee payment window. Consequently, if a pre-bill is 
not paid by the due date, it becomes delinquent and is subject to 
our debt collection procedures. See also 47 CFR 1.1161(c), 
1.1164(f)(5), and 1.1910.
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    15. In FY 2001, we began mailing pre-completed FCC Form 159-W 
assessments to carriers in an effort to assist them in paying their 
Interstate Telecommunications Service Provider (ITSP) regulatory fee. 
The fee amount on FCC Form 159-W was calculated from the FCC Form 499-A 
worksheet. Beginning in FY 2004, we mailed the completed FCC Form 159-W 
as a pre-bill, rather than as an assessment of amount due. Other than 
the manner in which Form 159-W payments were entered into our financial 
system, carriers experienced no procedural changes regarding the use of 
the FCC Form 159-W when submitting payment of their ITSP regulatory 
fees. We seek comment on continuing this pre-billing process in FY 
2007.
    16. We also propose to round lines 14 (total subject revenues) and 
16 (total regulatory fee owed) on FCC Form 159-W to the nearest dollar. 
Line 14 must be rounded to a whole dollar amount because this data 
field is linked to the FCC Form 159 Remittance Advice Block 25A 
(quantity), which can only accept whole numbers. It logically follows 
that if line 14 must be rounded, then the form's final line that 
calculates the total fee owed (line 16) should be rounded to the 
nearest dollar, as well. Also, rounding lines 14 and 16 will nominally 
ease the filing and payment burdens of our Form 159-W filers. We seek 
comment on these proposals and on other ways that we could improve our 
pre-billing initiative for ITSPs.
b. Satellite Space Station Licensees
    17. Beginning in FY 2004, we mailed regulatory fee pre-bills via 
surface mail to licensees in our two satellite space station service 
categories. Specifically, geostationary orbit space station (GSO) 
licensees receive bills requesting regulatory fee payment for 
satellites that (1) were licensed by the Commission and operational on 
or before October 1

[[Page 24217]]

of the respective fiscal year; and (2) were not co-located with and 
technically identical to another operational satellite on that date 
(i.e., were not functioning as a spare satellite). Non-geostationary 
orbit space station (NGSO) licensees received pre-bills requesting 
regulatory fee payment for systems that were licensed by the Commission 
and operational on or before October 1 of the respective fiscal year.
    18. For FY 2007, we propose to continue mailing pre-bills for our 
GSO and NGSO satellite space station categories. We seek comment on 
this proposal. We emphasize that the pre-bills that we propose to 
generate for our GSO and NGSO licensees will only be for the satellite 
or system aspects of their respective operations. GSO and NGSO 
licensees typically have regulatory fee obligations in other service 
categories (such as earth stations, broadcast facilities, etc.), and we 
expect satellite operators to meet their full fee payment obligation 
for all of their FCC holdings. We seek comment on our proposal to 
generate regulatory fee pre-bills for our two satellite space station 
service categories.
c. Additional Service Categories for Billing
    19. We propose to expand our section 9 regulatory fee pre-billing 
initiative to include the service categories for Earth Stations and 
Cable Television Relay Service (CARS) Stations, beginning in FY 2007. 
Pre-billing can be accomplished for these categories because they are 
comprised of relatively few payment units (relative to many other 
categories in our Schedule of Regulatory Fees), and because the 
Commission maintains licensing databases for both categories. We seek 
comment on our proposal to send regulatory fee pre-bills via surface 
mail to licensees of Earth Stations and CARS.
d. Media Services Licensees
    20. Beginning in FY 2003, we sent fee assessment notifications via 
surface mail to media services entities on a per-facility basis. The 
notifications provided the assessed fee amount for the facility in 
question, as well as the data attributes that determined the fee 
amount. We have since refined this initiative with improved 
results.\18\ We propose to continue our assessment initiative for media 
services licensees this year.\19\ We seek comment on this proposal.
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    \18\ Some of those refinements have been to provide licensees 
with a Commission-authorized web site to update or correct any 
information concerning their facilities, and to amend their fee-
exempt status, if need be. Also, our notifications now provide 
licensees with a telephone number to call in the event that they 
need customer assistance. The notifications themselves have been 
refined so that licensees of fewer than four facilities receive 
individual fee assessment postcards for their facilities; whereas 
licensees of four or more facilities now receive a single assessment 
letter that lists all of their facilities and the associated 
regulatory fee obligation for each facility.
    \19\ Fee assessments are proposed again to be issued for AM and 
FM Radio Stations, AM and FM Construction Permits, FM Translators/
Boosters, VHF and UHF Television Stations, VHF and UHF Television 
Construction Permits, Satellite Television Stations, Low Power 
Television (LPTV) Stations and LPTV Translators/Boosters, to the 
extent that applicants, permittees and licensees of such facilities 
do not qualify as government entities or non-profit entities. Fee 
assessments have not been issued for broadcast auxiliary stations in 
prior years, nor will they be issued in FY 2007.
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    21. Consistent with procedures used last year, we propose to mail 
assessment notifications to licensees to their primary record of 
contact populated in CDBS (Consolidated Database System) and to their 
secondary record of contact, if available. We will continue to make the 
Commission-authorized web site available to licensees to update or 
correct any information concerning their facilities and to amend their 
fee-exempt status, if need be.\20\ We seek comment on this proposal.
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    \20\ The Commission-authorized web site for media services 
licensees is https://www.fccfees.com.
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    22. Under our proposal, licensees must still submit a completed FCC 
Form 159 Remittance Advice with their fee payments. The assessment 
notifications cannot be used as a substitute for a completed Form 159.
e. Commercial Mobile Radio Service (CMRS) Cellular and Mobile Services 
Assessments
    23. As we have done in prior years, we propose to mail an 
assessment letter to Commercial Mobile Radio Service (CMRS) providers 
using data that is based on the Numbering Resource Utilization Forecast 
(NRUF) form, which includes a list of the carrier's Operating Company 
Numbers (OCNs) upon which the assessment is based.\21\ Consistent with 
existing practice, the letters will not include OCNs with their 
respective assigned number counts, but rather, an aggregate total of 
assigned numbers for each carrier. We also propose to continue our 
procedure of giving entities an opportunity to amend their subscriber 
counts by sending two rounds of assessment letters--an initial 
assessment and a final assessment letter. We seek comment on this 
proposal.
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    \21\ 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) (FY 2005 R&O and Order on Recon).
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    24. If the number of subscribers on the initial assessment letter 
differs from the subscriber count the service provider provided on its 
NRUF form, the carrier can correct its subscriber count by returning 
the assessment letter or by contacting the Commission and stating a 
reason for the change, such as the purchase or the sale of a 
subsidiary, including the date of the transaction, and any other 
information that will help to justify a reason for the change.
    25. If we receive no response or correction to our initial 
assessment letter, we will expect the fee payment to be based on the 
number of subscribers listed on the initial assessment. We will review 
all responses to initial assessment letters and determine whether a 
change in the number of subscribers is warranted. We will then generate 
and mail a final assessment letter. The final assessment letter will 
inform carriers as to whether or not we accept the changed number of 
subscribers. As in previous years, operators will certify their 
subscriber counts in Block 30 of the FCC Form 159 Remittance Advice 
when making their regulatory fee payments. We seek comment on our 
current procedures of assessing CMRS subscriber counts (for NRUF 
filers), and other ways to improve the process.
    26. Although an initial and a final assessment letter will be 
mailed to carriers that have filed an NRUF form, some carriers may not 
be sent a letter of assessment because they did not file the NRUF form. 
We propose that these carriers compute their fee payment using the 
standard methodology \22\ that is currently in place for CMRS Wireless 
services (e.g., compute their subscriber counts as of December 31, 
2006), and submit their payment accordingly on FCC Form 159. However, 
regardless of whether a carrier receives an assessment letter or 
computes the subscriber count itself, the Commission may audit the 
number of subscribers for which regulatory fees are paid. In the event 
that the Commission determines that the number of subscribers is 
inaccurate or that an insufficient reason is given for making a 
correction on the initial assessment letter, the Commission will assess 
the carrier for the difference between what was paid and what should 
have been paid.
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    \22\ Federal Communications Commission, Regulatory Fees Fact 
Sheet: What You Owe--Commercial Wireless Services for FY 2005 at 1 
(rel. Jul. 2005).
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    27. We, therefore, propose to (1) derive the subscriber count from 
NRUF

[[Page 24218]]

data based on ``assigned'' number counts that have been adjusted for 
porting to net Type 0 ports (``in'' and ``out''); (2) provide carriers 
with an opportunity to revise their subscriber counts at the time when 
the initial assessment letter is mailed; and (3) require carriers to 
confirm their subscriber counts at the aggregate level using data in 
the NRUF report. We seek comment on these proposals.
f. Cable Television Subscribers
    28. We propose to continue to permit cable television operators to 
base their regulatory fee payment on their company's aggregate year-end 
subscriber count, rather than requiring them to sub-report subscriber 
counts on a per community unit identifier (CUID) basis on the FCC Form 
159 Remittance Advice. We seek comment on this proposal. Operators, 
after providing their company's aggregate subscriber count in Block 25A 
of the FCC Form 159, will still be required to certify the accuracy of 
the subscriber count in Block 30. This practice has worked well for the 
Commission the past three fiscal years and has eased administrative 
burdens for the cable television industry.
    29. Last year, for the first time, we sent a message to e-mail 
addresses populated in the Media Bureau's Cable Operations and 
Licensing System (COALS) to notify recipients of the FY 2006 regulatory 
fee payment due date and the fee amount for basic cable television 
subscribers. We propose to continue this effort for FY 2007. We also 
propose to discontinue our practice of sending fee assessment letters 
via surface mail to cable television operators who are on file as 
having paid regulatory fees the previous fiscal year. We seek comment 
on our proposals.
3. Streamlined Regulatory Fee Payment Process for Commercial Mobile 
Radio Service (CMRS) Cellular and Mobile Providers
    30. In FY 2006, we streamlined the CMRS payment process by 
eliminating the requirement for CMRS providers to identify their 
individual call signs when making their regulatory fee payment, 
requiring instead for CMRS providers to pay their regulatory fees only 
at the aggregate subscriber level without having to identify their 
various call signs.\23\ We propose to continue this practice in FY 
2007. We seek comment on this proposal. As an additional measure to 
reduce the administrative burden on CMRS licensees, we propose to 
consolidate the CMRS cellular and CMRS mobile fee categories into one 
fee category, thereby eliminating the requirement for CMRS providers to 
separate their subscriber counts into CMRS cellular and CMRS mobile fee 
categories during the regulatory fee payment process. We seek comment 
on this proposal.
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    \23\ See Assessment and Collection of Regulatory Fees for Fiscal 
Year 2006, MD Docket No. 06-68, Report and Order, 21 FCC Rcd 8092, 
8105, para. 48 (2006).
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    31. In our FY 1998 Report and Order, the Commission classified 
Wireless Communications Service (WCS), which included Personal 
Communications Services (Part 24), as a CMRS Mobile Service, stating 
that the Commercial Mobile Radio Service (CMRS) is ``an `umbrella' 
descriptive term attributed to various existing broadband services 
authorized to provide interconnected mobile radio services.'' \24\ 
However, beginning in FY 1998, a separate fee code was provided for 
Personal Communications Service (PCS) to monitor the number of units in 
this category of service. In recent years, the need to track the number 
of units for CMRS cellular and CMRS mobile separately has become 
unnecessary, especially for regulatory fee purposes. Therefore, 
beginning in FY 2007, we propose to consolidate the CMRS cellular and 
CMRS mobile fee categories into one CMRS fee category. To illustrate, 
in FY 2007 the CMRS cellular fee category of ``0711'' and the CMRS 
mobile fee category of ``0712'' would be consolidated into the fee 
category of ``0711.'' Licensees paying regulatory fees for CMRS 
cellular and CMRS mobile will need only to identify their aggregate 
subscriber unit totals under the fee code of ``0711.'' We seek comment 
on this proposal.
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    \24\ See Assessment and Collection of Regulatory Fees for Fiscal 
Year 1998, MD Docket No. 98-36, Report and Order, 63 FR 35847, para. 
49, and in Attachment H, Detailed Guidance on Who Must Pay 
Regulatory Fees, para. 14 (1998).
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4. Future Streamlining of the Regulatory Fee Assessment and Collection 
Process
    32. We continue to welcome comments concerning our commitment to 
reviewing, streamlining, and modernizing our statutorily required fee 
assessment and collection procedures. Our areas of particular interest 
include: (1) The process for notifying licensees about changes in the 
annual Schedule of Regulatory Fees and how it can be improved; (2) the 
most effective way to disseminate regulatory fee assessments and bills, 
e.g., through surface mail, e-mail, online Web site, or some other 
mechanism; (3) the fee payment process, including how the agency's 
online regulatory fee filing system (Fee Filer) can be enhanced; (4) 
the timing of fee payments, including whether we should alter the 
existing section 9 regulatory fee payment window in any way; and (5) 
the timing of fee assessments and pre-bills.

III. Procedural Matters

 A. Payment of Regulatory Fees

1. De Minimis Fee Payment Liability
    33. Consistent with past practice, regulatees whose total FY 2006 
regulatory fee liability, including all categories of fees for which 
payment is due, amounts to less than $10 will be exempted from payment 
of FY 2007 regulatory fees.
2. Standard Fee Calculations and Payment Dates
    34. The Commission will, for the convenience of payers, accept fee 
payments made in advance of the window for the payment of regulatory 
fees. Licensees are reminded that, under our current rules, the 
responsibility for payment of fees by service category is as follows:
    (a) Media Services: Regulatory fees must be paid for initial 
construction permits that were granted on or before October 1, 2006 for 
AM/FM radio stations, VHF/UHF television stations and satellite 
television stations. Regulatory fees must be paid for all broadcast 
facility licenses granted on or before October 1, 2006. In instances 
where a permit or license is transferred or assigned after October 1, 
2006, responsibility for payment rests with the holder of the permit or 
license as of the fee due date.
    (b) Wireline (Common Carrier) Services: Regulatory fees must be 
paid for authorizations that were granted on or before October 1, 2006. 
In instances where a permit or license is transferred or assigned after 
October 1, 2006, responsibility for payment rests with the holder of 
the permit or license as of the fee due date.
    (c) Wireless Services: Commercial Mobile Radio Service (CMRS) 
cellular, mobile, and messaging services (fees based upon a subscriber, 
unit or circuit count): Regulatory fees must be paid for authorizations 
that were granted on or before October 1, 2006. The number of 
subscribers, units or circuits on December 31, 2006 will be used as the 
basis from which to calculate the fee payment.
    The first eleven regulatory fee categories in our Schedule of 
Regulatory Fees (see Attachment D) pay what we refer to as ``small 
multi-year wireless regulatory fees.'' Entities pay these regulatory 
fees in advance for the entire amount of their 5-year or 10-year term

[[Page 24219]]

of initial license, and only pay regulatory fees again for the license 
at the time of its next renewal. So while we include these eleven 
categories in our Schedule of Regulatory Fees to publicize the fee 
amounts, we do not actually collect these fees on an annual basis.
    (d) Multichannel Video Programming Distributor Services (cable 
television operators and CARS licensees): Regulatory fees must be paid 
for the number of basic cable television subscribers as of December 31, 
2006.\25\ Regulatory fees also must be paid for CARS licenses that were 
granted on or before October 1, 2006. In instances where a CARS license 
is transferred or assigned after October 1, 2006, responsibility for 
payment rests with the holder of the license as of the fee due date.
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    \25\ Cable television system operators should compute their 
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 2006, rather than on a count as of December 31, 
2006.
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    (e) International Services: Regulatory fees must be paid for earth 
stations, geostationary orbit space stations and non-geostationary 
orbit satellite systems that were licensed and operational on or before 
October 1, 2006. In instances where a license is transferred or 
assigned after October 1, 2006, responsibility for payment rests with 
the holder of the license as of the fee due date. Regulatory fees must 
be paid for international bearer circuits, the payments of which are 
determined by the number of active circuits as of December 31, 
2006.\26\
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    \26\ Regulatory fees for International Bearer Circuits are to be 
paid by facilities-based common carriers that have active 
international bearer circuits in any 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. Non-common carrier submarine cable operators are 
also to pay fees for any and all international bearer circuits sold 
on an indefeasible right of use (IRU) basis or leased to any 
customer, including themselves or their affiliates, other than an 
international common carrier authorized by the Commission to provide 
U.S. international common carrier services. See Assessment and 
Collection of Regulatory Fees for Fiscal Year 2001, MD Docket No. 
01-76, Report and Order, 16 FCC Rcd 13525, 13593 (2001); Regulatory 
Fees Fact Sheet: What You Owe--International and Satellite Services 
Licensees for FY 2004 at 3 (rel. July 2004) (the fact sheet is 
available on the FCC web-site at: https://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-249904A4.pdf). On February 6, 2006, VSNL 
Telecommunications (US) Inc. filed a Petition for Rulemaking urging 
the Commission to reform the current International Bearer Circuit 
Fee rules and policies as applied to non-common carrier submarine 
cable operators. See Petition for Rulemaking of VSNL 
Telecommunications (US) Inc., RM-11312 (filed February 6, 2006). 
This Petition remains pending before the Commission, which has 
issued a Public Notice requesting comment on the petition. See 
Consumer and Governmental Affairs Bureau, Reference Information 
Center, Public Notice, Report No. 2759 (released February 15, 2006). 
The Commission intends to resolve the complex issues presented by 
this Petition separately, and any comments on these issues filed in 
the instant proceeding will be incorporated into, and addressed, 
with those filed on the Petition for Rulemaking.
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B. Enforcement

    35. As a reminder to all licensees, section 159(c) of the 
Communications Act requires us to impose an additional charge as a 
penalty for late payment of any regulatory fee. As in years past, a 
late payment penalty of 25 percent of the amount of the required 
regulatory fee will be assessed on the first day following the deadline 
date for filing of these fees. Regulatory fee payment must be received 
and stamped at the lockbox bank by the last day of the regulatory fee 
filing window, and not merely postmarked by the last day of the window. 
Failure to pay regulatory fees and/or any late penalty will subject 
regulatees to sanctions, including the Commission's Red Light Rule (see 
47 CFR 1.1910) and the provisions set forth in the Debt Collection 
Improvement Act of 1996 (DCIA). 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 47 CFR 1.1940(d) of the Commission's rules. 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 
licensee 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.
    36. Furthermore, our regulatory fee rules provide that 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 ultimately dismiss 
those applications or other requests if payment of the delinquent debt 
or other satisfactory arrangement for payment is not made. See 47 CFR 
1.1161(c), 1.1164(f)(5), and 1.1910. Failure to pay regulatory fees can 
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

    37. With respect to this NPRM, an Initial Regulatory Flexibility 
Analysis (IRFA), is contained in Attachment A of the Appendix.\27\ 
Comments must be identified as responses to the IRFA and must be filed 
by the deadlines for comments on the NPRM specified infra. The 
Commission will send a copy of the NPRM, including the IRFA, to the 
Chief Counsel for Advocacy of the Small Business Administration.
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    \27\ See 5 U.S.C. 603. In addition, the NPRM and the IRFA (or 
summaries thereof) will be published in the Federal Register.
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D. Initial Paperwork Reduction Act of 1995 Analysis

    38. This NPRM does not contain proposed or modified information 
collection(s) subject to the Paperwork Reduction Act of 1995 (PRA), 
Public Law 104-13. In addition, therefore, it does not contain any new 
or modified ``information collection burden for small business concerns 
with fewer than 25 employees,'' pursuant to the Small Business 
Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 
3506(c)(4). Completion of the 159 family of forms required by the 
Commission's regulatory fee payment process is already approved by the 
Office of Management and Budget under information collections 3060-0589 
and 3060-0949.

E. Ex Parte Rules

    39. Permit-But-Disclose. This proceeding will be treated as a 
``permit-but-disclose'' proceeding subject to the ``permit-but-
disclose'' requirements under section 1.1206(b) of the Commission's 
rules.\28\ Ex parte presentations are permissible if disclosed in 
accordance with Commission rules, except during the Sunshine Agenda 
period when presentations, ex parte or otherwise, are generally 
prohibited. Persons making oral ex parte presentations are reminded 
that a memorandum summarizing a presentation must contain a summary of 
the substance of the presentation and not merely a listing of the 
subjects discussed. More than a one- or two-sentence description of the 
views and arguments presented is generally

[[Page 24220]]

required.\29\ Additional rules pertaining to oral and written 
presentations are set forth in section 1.1206(b).
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    \28\ See 47 CFR 1.1206(b); see also 47 CFR 1.1202, 1.1203.
    \29\ See 47 CFR 1.1206(b)(2).
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F. Filing Requirements

    40. Comments and Replies. Pursuant to sections 1.415 and 1.419 of 
the Commission's rules,\30\ interested parties may file comments on or 
before the dates indicated on the first page of this document. Comments 
may be filed using: (1) the Commission's Electronic Comment Filing 
System (ECFS), (2) the Federal Government's eRulemaking Portal, or (3) 
procedures for filing paper copies.\31\
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    \30\ See id. 1.415, 1419.
    \31\ Electronic Filing of Documents in Rulemaking Proceedings, 
13 FCC Rcd 11322 (1998).
---------------------------------------------------------------------------

    41. Electronic Filers: Comments may be filed electronically using 
the Internet by accessing the ECFS: https://www.fcc.gov/cgb/ecfs or the 
Federal eRulemaking Portal: https://www.regulations.gov. Filers should 
follow the instructions provided on the Web site for submitting 
comments. For ECFS filers, if multiple docket or rulemaking numbers 
appear in the caption of this proceeding, filers must transmit one 
electronic copy of the comments for each docket or rulemaking number 
referenced in the caption. In completing the transmittal screen, filers 
should include their full name, U.S. Postal Service mailing address, 
and the applicable docket or rulemaking number. Parties may also submit 
an electronic comment by Internet e-mail. To get filing instructions, 
filers should send an e-mail to ecfs@fcc.gov, and include the following 
words in the body of the message, ``get form.'' A sample form and 
directions will be sent in response.
    42. Paper Filers: Parties who choose to file by paper must file an 
original and four copies of each filing. If more than one docket or 
rulemaking number appears in the caption of this proceeding, filers 
must submit two additional copies for each additional docket or 
rulemaking number. Filings can be sent by hand or messenger delivery, 
by commercial overnight courier, or by first-class or overnight U.S. 
Postal Service mail (although we continue to experience delays in 
receiving U.S. Postal Service mail). All filings must be addressed to 
the Commission's Secretary, Office of the Secretary, Federal 
Communications Commission.
     The Commission's contractor will receive hand-delivered or 
messenger-delivered paper filings for the Commission's Secretary at 236 
Massachusetts Avenue, NE., Suite 110, Washington, DC 20002. The filing 
hours at this location are 8 a.m. to 7 p.m. All hand deliveries must be 
held together with rubber bands or fasteners. Any envelopes must be 
disposed of before entering the building.
     Commercial overnight mail (other than U.S. Postal Service 
Express Mail and Priority Mail) must be sent to 9300 East Hampton 
Drive, Capitol Heights, MD 20743.
     U.S. Postal Service first-class, Express, and Priority 
mail should be addressed to 445 12th Street, SW., Washington, DC 20554.
    43. Availability of Documents. Comments, reply comments, and ex 
parte submissions will be available for public inspection during 
regular business hours in the FCC Reference Center, Federal 
Communications Commission, 445 12th Street, SW., CY-A257, Washington, 
DC, 20554. These documents will also be available free online, via 
ECFS. Documents will be available electronically in ASCII, Word 97, 
and/or Adobe Acrobat.
    44. Accessibility Information. To request information in accessible 
formats (computer diskettes, large print, audio recording, and 
Braille), send an e-mail to fcc504@fcc.gov or call the FCC's Consumer 
and Governmental Affairs Bureau at (202) 418-0530 (voice), (202) 418-
0432 (TTY). This document can also be downloaded in Word and Portable 
Document Format (PDF) at: https://www.fcc.gov.

IV. Ordering Clauses

    45. 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 Notice of Proposed 
Rulemaking is hereby adopted.
    46. It is further ordered that the Commission's Consumer and 
Governmental Affairs Bureau, Reference Information Center, shall send a 
copy of this Notice of Proposed Rulemaking, including the Initial 
Regulatory Flexibility Analysis, to the Chief Counsel for Advocacy of 
the Small Business Administration.

Federal Communications Commission.
Marlene H. Dortch,
Secretary.

Attachment A--Initial Regulatory Flexibility Analysis

    47. As required by the Regulatory Flexibility Act (RFA),\32\ the 
Commission has prepared this Initial Regulatory Flexibility Analysis 
(IRFA) of the possible significant economic impact on small entities by 
the policies and rules in the present NPRM. Written public comments are 
requested on this IRFA. Comments must be identified as responses to the 
IRFA and must be filed on or before the dates indicated on the first 
page of this NPRM. The Commission will send a copy of the NPRM, 
including the IRFA, to the Chief Counsel for Advocacy of the Small 
Business Administration.\33\ In addition, the NPRM and IRFA (or 
summaries thereof) will be published in the Federal Register.\34\
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    \32\ 5 U.S.C. 603. The RFA, 5 U.S.C. 601-612 has been amended by 
the Contract With America Advancement Act of 1996, Public Law 104-
121, 110 Stat. 847 (1996) (CWAAA). Title II of the CWAAA is the 
Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA).
    \33\ 5 U.S.C. 603(a).
    \34\ Id.
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I. Need for, and Objectives of, the Proposed Rules

    48. This rulemaking proceeding is initiated to obtain comments 
concerning the Commission's proposed amendment of its Schedule of 
Regulatory Fees in the amount of $290,295,160, the amount that Congress 
has required the Commission to recover. The Commission seeks to collect 
the necessary amount through its proposed Schedule of Regulatory Fees 
in the most efficient manner possible and without undue public burden.

II. Legal Basis

    49. 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.\35\
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    \35\ 47 U.S.C. 154(i) and (j), 159, and 303(r).
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III. Description and Estimate of the Number of Small Entities to Which 
the Proposed Rules Will Apply

    50. 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.\36\ The RFA 
generally defines the term ``small entity'' as having the same meaning 
as the terms ``small business,'' ``small organization,'' and ``small 
governmental jurisdiction.'' \37\ In addition, the term ``small 
business'' has the same meaning as the term ``small business concern'' 
under the Small Business Act.\38\ A ``small business

[[Page 24221]]

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.\39\
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    \36\ 5 U.S.C. 603(b)(3).
    \37\ 5 U.S.C. 601(6).
    \38\ 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.''
    \39\ 15 U.S.C. 632.
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    51. Small Businesses. Nationwide, there are a total of 22.4 million 
small businesses, according to SBA data.\40\
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    \40\ SBA, Programs and Services, SBA Pamphlet No. CO-0028, at 
page 40 (July 2002).
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    52. Small Organizations. Nationwide, there are approximately 1.6 
million small organizations.\41\
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    \41\ Independent Sector, The New Nonprofit Almanac & Desk 
Reference (2002).
---------------------------------------------------------------------------

    53. Small Governmental Jurisdictions. The term ``small governmental 
jurisdiction'' is defined generally as ``governments of cities, towns, 
townships, villages, school districts, or special districts, with a 
population of less than fifty thousand.'' \42\ Census Bureau data for 
2002 indicate that there were 87,525 local governmental jurisdictions 
in the United States.\43\ We estimate that, of this total, 84,377 
entities were ``small governmental jurisdictions.'' \44\ Thus, we 
estimate that most governmental jurisdictions are small.
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    \42\ 5 U.S.C. 601(5).
    \43\ U.S. Census Bureau, Statistical Abstract of the United 
States: 2006, Section 8, page 272, Table 415.
    \44\ We assume that the villages, school districts, and special 
districts are small, and total 48,558. U.S. Census Bureau, 
Statistical Abstract of the United States: 2006, section 8, page 
273, Table 417. For 2002, Census Bureau data indicate that the total 
number of county, municipal, and township governments nationwide was 
38,967, of which 35,819 were small. Id.
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    54. We have included small incumbent local exchange carriers in 
this present RFA analysis. As noted above, a ``small business'' under 
the RFA is one that, inter alia, meets the pertinent small business 
size standard (e.g., a telephone communications business having 1,500 
or fewer employees), and ``is not dominant in its field of operation.'' 
\45\ The SBA's Office of Advocacy contends that, for RFA purposes, 
small incumbent local exchange carriers are not dominant in their field 
of operation because any such dominance is not ``national'' in 
scope.\46\ We have therefore included small incumbent local exchange 
carriers in this RFA analysis, although we emphasize that this RFA 
action has no effect on Commission analyses and determinations in 
other, non-RFA contexts.
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    \45\ 15 U.S. C. 632.
    \46\ Letter from Jere W. Glover, Chief Counsel for Advocacy, 
SBA, to William E. Kennard, Chairman, FCC (May 27, 1999). The Small 
Business Act contains a definition of ``small-business concern,'' 
which the RFA incorporates into its own definition of ``small 
business.'' See 15 U.S.C. 632(a) (Small Business Act); 5 U.S.C. 
601(3) (RFA). SBA regulations interpret ``small business concern'' 
to include the concept of dominance on a national basis. See 13 CFR 
121.102(b).
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    55. Incumbent Local Exchange Carriers (ILECs). Neither the 
Commission nor the SBA has developed a small business size standard 
specifically for incumbent local exchange services. 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.\47\ According to 
Commission data,\48\ 1,303 carriers have reported that they are engaged 
in the provision of incumbent local exchange services. Of these 1,303 
carriers, an estimated 1,020 have 1,500 or fewer employees and 283 have 
more than 1,500 employees. Consequently, the Commission estimates that 
most providers of incumbent local exchange service are small businesses 
that may be affected by our proposed action.
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    \47\ 13 CFR 121.201, North American Industry Classification 
System (NAICS) code 517110.
    \48\ FCC, Wireline Competition Bureau, Industry Analysis and 
Technology Divisio