Assessment and Collection of Regulatory Fees for Fiscal Year 2015, 43019-43031 [2015-17288]
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Federal Register / Vol. 80, No. 139 / Tuesday, July 21, 2015 / Rules and Regulations
will not be costly nor will it materially
interfere with the simplification of the
docket closure process. The
Commission revises the rule to include
a new paragraph that states each month
the Commission will post on its Web
site a list of dockets that will, without
action taken by parties or the
Commission, be subject to automatic
closure in the following month and the
scheduled date of closure for each
docket. This revision is reflected in rule
3001.44(b).
Additional minor correction. The
Commission makes the following minor
correction:
• In paragraphs (a) and (b) of rule
3001.45 ‘‘any interested party or
participant’’ is simplified to read
‘‘interested persons.’’
IV. Ordering Paragraphs
It is ordered:
1. Part 3001 of title 39, Code of
Federal Regulations, is revised as set
forth below the signature of this Order,
effective 30 days after publication in the
Federal Register.
2. The Secretary shall arrange for
publication of this order in the Federal
Register.
List of Subjects in 39 CFR Part 3001
Administrative practice and
procedure, Postal Service.
For the reasons discussed in the
preamble, the Commission amends
chapter III of title 39 of the Code of
Federal Regulations as follows:
§ 3001.45 Motions to Stay Automatic
Closure or Reopen Automatically Closed
Dockets.
(a) Motion to stay automatic closure.
(1) Interested persons, including the
Postal Service or a Public
Representative, may file a motion to stay
automatic closure, pursuant to
§ 3001.21, and request that the docket
remain open for a specified term not to
exceed 12 months. Motions to stay
automatic closure must be filed at least
15 days prior to the automatic closure
date.
(2) The Commission may order a
docket remain open for a specified term
not to exceed 12 months and must file
such order at least 15 days prior to the
automatic closure date.
(b) Motion to reopen automatically
closed docket. (1) If, at any time after a
docket has been automatically closed,
interested persons, including the Postal
Service or a Public Representative, may
file a motion to reopen an automatically
closed docket, pursuant to § 3001.21,
and must set forth with particularity
good cause for reopening the docket.
(2) The Commission may order an
automatically closed docket to be
reopened, and must set forth with
particularity good cause for reopening
the docket.
By the Commission.
Ruth Ann Abrams,
Acting Secretary.
[FR Doc. 2015–17825 Filed 7–20–15; 8:45 am]
BILLING CODE 7710–FW–P
PART 3001—RULES OF PRACTICE
AND PROCEDURE
FEDERAL COMMUNICATIONS
COMMISSION
1. The authority citation of part 3001
continues to read as follows:
47 CFR Part 1
Authority: 39 U.S.C. 404(d); 503; 504;
3661.
[MD Docket Nos. 14–92; 15–121; 15–121;
FCC 15–59]
■
■
2. Add § 3001.44 to read as follows:
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§ 3001.44
Docket.
Automatic Closure of Inactive
(a) The Commission shall
automatically close a docket in which
there has been no activity of record by
any interested person for 12 consecutive
months, except those dockets in which
the Commission must issue a final
determination by rule or statute, or if
the Commission has otherwise indicated
a final order is forthcoming in the
docket and has yet to do so.
(b) Each month the Commission shall
post on the Web site a list of dockets
that will be subject to automatic closure
in the following month and will include
the date on which the docket will
automatically close.
■ 3. Add § 3001.45 to read as follows:
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Assessment and Collection of
Regulatory Fees for Fiscal Year 2015
Federal Communications
Commission.
ACTION: Final rule.
AGENCY:
In this document, the Federal
Communications Commission
(Commission) eliminates the regulatory
fee components of two fee categories,
the amateur radio Vanity Call Sign and
the General Mobile Radio Service
(GMRS); establishes a new Direct
Broadcast Satellite (DBS) regulatory fee
category; provides specific instructions
for RespOrgs (Responsible
Organizations), holders of toll free
numbers that are subject to regulatory
fees, and amends rule provisions to
specify that debts owed to the
SUMMARY:
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43019
Commission that have been delinquent
for a period of 120 days shall be
transferred to the Secretary of the
Treasury.
DATES:
Effective July 21, 2015.
FOR FURTHER INFORMATION CONTACT:
Roland Helvajian, Office of Managing
Director at (202) 418–0444.
SUPPLEMENTARY INFORMATION: This is a
summary of the Commission’s Report
and Order, FCC 15–59, MD Docket No.
15–121, adopted on May 20, 2015 and
released May 21, 2015.
I. Procedural Matters
Final Regulatory Flexibility Analysis
1. As required by the Regulatory
Flexibility Act of 1980 (RFA),1 the
Commission has prepared a Final
Regulatory Flexibility Analysis (FRFA)
relating to this Report and Order.
Congressional Review Act
2. The Commission will send a copy
of this Report and Order and Order to
Congress and the Government
Accountability Office pursuant to the
Congressional Review Act. 5 U.S.C.
801(a)(1)(A).
Final Paperwork Reduction Act of 1995
Analysis
3. This Report and Order 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).
4. Finally, in the Order section of this
document, we amend three sections of
our rules 2 to conform to the Digital
Accountability and Transparency Act
(DATA Act) concerning when claims
should be transferred to the Secretary of
the Treasury.3 In particular, we make
the ministerial change to our rules to
specify that debts owed to the
Commission that have been delinquent
for a period of 120 days shall be
transferred to the Secretary of the
Treasury. The rules previously specified
transfer of delinquent debt to the
Treasury after 180 days.
II. Introduction
5. In the Report and Order, the
Commission adopted a proposal from
1 See 5 U.S.C. 603. The RFA, see 5 U.S.C. 601–
612, has been amended by the Small Business
Regulatory Enforcement Fairness Act of 1996
(SBREFA), Public Law 104–121, Title II, 110 Stat.
847 (1996). The SBREFA was enacted as Title II of
the Contract with America Advancement Act of
1996 (CWAAA).
2 47 CFR 1.1911(d), 1.1912(b)(1), 1.1917(c).
3 31 U.S.C. 3716(c)(6).
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our FY 2014 Further Notice of Proposed
Rulemaking to add a new subcategory in
the existing cable television and Internet
Protocol TV (IPTV) regulatory fee
category for direct broadcast satellite
(DBS) providers.4 In addition, we
provide specific instructions regarding
our new regulatory fee requirement for
toll free numbers.5 We also remove
amateur radio Vanity Call Signs and
General Mobile Radio Service (GMRS)
from the regulatory fee schedule.6 The
addition of DBS to the cable television
and IPTV category and removal of two
wireless categories from the schedule
are permitted amendments to the
regulatory fee schedule and require
Congressional notification.7
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III. Background
6. The Commission is required by
Congress to assess regulatory fees each
year in an amount that can reasonably
be expected to equal the amount of its
appropriation.8 Regulatory 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. . . .’’ 9
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.10 Regulatory fees also cover
the costs incurred in regulating entities
that are statutorily exempt from paying
regulatory fees,11 entities whose
regulatory fees are waived,12 and
entities that provide nonregulated
4 Assessment and Collection of Regulatory Fees
for Fiscal Year 2014, Report and Order and Further
Notice of Proposed Rulemaking, MD Docket No. 14–
92, 79 FR 63883, 63885–63886, paras. 10–15
(October 27, 2014).
5 In 2014, the Commission adopted a regulatory
fee requirement for toll free numbers. See FY 2014
Report and Order, 79 FR 54190, 54195–54196,
paras. 28–31 (September 11, 2014).
6 We sought comment on eliminating these
categories in our FY 2014 NPRM. Assessment and
Collection of Regulatory Fees for Fiscal Year 2014,
Notice of Proposed Rulemaking, Second Further
Notice of Proposed Rulemaking, and Order, MD
Docket No. 14–92, 79 FR 37982, 37989, para. 38
(July 3, 2014).
7 47 U.S.C. 159(b)(3)–(4)(requiring Congressional
notification of permitted amendments not later than
90 days before the effective date of such
amendment).
8 47 U.S.C. 159(b)(1)(B).
9 47 U.S.C. 159(b)(1)(A).
10 See Assessment and Collection of Regulatory
Fees for Fiscal Year 2004, Report and Order, 69 FR
41028, 4103, para. 11 (July 7, 2004).
11 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 CFR
1.1162.
12 47 CFR 1.1166.
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services. Congress sets the amount the
Commission must collect each year in
the Commission’s fiscal year
appropriations, and section 9(a)(2) of
the Communications Act of 1934, as
amended (Communications Act or Act)
requires the Commission to collect fees
sufficient to offset the amount
appropriated.13 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 full time
employees (FTEs) 14 in each regulatory
fee category. Historically, the
Commission has classified FTEs as
‘‘direct’’ if the employee is in one of the
four ‘‘core’’ bureaus; otherwise, that
employee was considered an ‘‘indirect’’
FTE.15 The total FTEs for each fee
category includes the direct FTEs
associated with that category, plus a
proportional allocation of the indirect
FTEs.
7. Section 9 of the Communications
Act requires the Commission to make
certain changes (i.e., mandatory
amendments) to the regulatory fee
schedule if it ‘‘determines that the
Schedule requires amendment to
comply with the requirements’’ of
section 9(b)(1)(A).16 In addition, the
Commission must add, delete, or
reclassify services in the fee schedule to
reflect additions, deletions, or changes
in the nature of its services ‘‘as a
consequence of Commission rulemaking
proceedings or changes in law.’’ 17
These ‘‘permitted amendments’’ require
Congressional notification.18 The
changes in fees resulting from both
U.S.C. 159(a)(2).
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.
15 The core bureaus are the Wireline Competition
Bureau (172 FTEs), Wireless Telecommunications
Bureau (91 FTEs), Media Bureau (155 FTEs), and
part of the International Bureau (28 FTEs), totaling
446 ‘‘direct’’ FTEs. 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 the Managing Director, Office of
General Counsel, Office of the Inspector General,
Office of Communications Business Opportunities,
Office of Engineering and Technology, Office of
Legislative Affairs, Office of Strategic Planning and
Policy Analysis, Office of Workplace Diversity,
Office of Media Relations, and Office of
Administrative Law Judges, totaling 1,037
‘‘indirect’’ FTEs. These totals are as of Oct. 1, 2014
and exclude auctions FTEs.
16 47 U.S.C. 159(b)(3).
17 47 U.S.C. 159(b)(3).
18 47 U.S.C. 159(b)(4)(B).
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mandatory and permitted amendments
are not subject to judicial review.19
8. The Commission continues to
improve the regulatory fee process by
ensuring 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.
For example, in 2013, the Commission
updated the FTE allocations to more
accurately align regulatory fees with the
costs of Commission oversight and
regulation,20 as recommended in the
GAO Report, a report issued by the
Government Accountability Office
(GAO) in 2012.21 The Commission also
reallocated some FTEs from the
International Bureau as ‘‘indirect.’’ 22
Subsequently, in the FY 2014 Report
and Order, the Commission adopted the
new toll free number regulatory fee
category 23 and, in the accompanying FY
2014 Further Notice of Proposed
Rulemaking, the Commission sought
additional comment on a new regulatory
fee category for DBS.24 In this Report
and Order, we now add a subcategory
for DBS providers in the cable television
and IPTV regulatory fee category based
on our finding that Media Bureau FTEs
work on issues and proceedings that
include DBS as well as other
multichannel video programming
distributors (MVPDs).
IV. Discussion
A. Report and Order
1. Eliminating Regulatory Fee Categories
9. In the FY 2014 NPRM,25 we sought
comment on eliminating several of the
smaller regulatory fee categories such as
amateur radio Vanity Call Signs 26 and
13 47
14 One
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19 47 U.S.C. 159(b)(3). But see Comsat Corp. v.
FCC, 114 F.3d 223, 227 (D.C. Cir. 1997) (‘‘Where,
as here, we find that the Commission has acted
outside the scope of its statutory mandate, we also
find that we have jurisdiction to review the
Commission’s action.’’)
20 Assessment and Collection of Regulatory Fees
for Fiscal Year 2013, Report and Order, MD Docket
No. 13–140, 78 FR 52433, 52436–52437, paras. 10–
15 (August 23, 2013).
21 In 2012, the GAO concluded that the
Commission should conduct an overall analysis of
the regulatory fee categories and perform an
updated FTE analysis by fee category. GAO
‘‘Federal Communications Commission Regulatory
Fee Process Needs to be Updated,’’ GAO–12–686
(Aug. 2012) (GAO Report) at 36, (available at
https://www.gao.gov/products/GAO–12–686).
22 FY 2013 Report and Order, 78 FR 52433,
52436–52438, paras. 12–21 (August 23, 2013).
23 FY 2014 Report and Order, 79 FR 54190,
54195–54196, paras. 28–31 (September 11, 2014).
24 FY 2014 Further Notice of Proposed
Rulemaking, 79 FR 63883, 63885–63886, paras. 10–
15 (October 27, 2014).
25 FY 2014 NPRM, 79 FR 37982, 37989, para. 38
(July 3, 2014).
26 Call signs assigned to newly licensed stations,
i.e., a sequential call sign, are assigned based on the
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GMRS.27 In the FY 2014 Report and
Order, we concluded that we did not yet
have adequate support to determine
whether the cost of recovery and burden
on small entities outweighed the
collected revenue or whether
eliminating the fee would adversely
affect the licensing process.28 We stated,
however, that we would reevaluate this
issue in the future. Since adoption of
the FY 2014 Report and Order,
Commission staff have had an
opportunity to obtain and analyze
support concerning the collection of
fees from these regulatees.
10. The GMRS and amateur radio
Vanity Call Sign regulatory fee
categories comprise on average over
20,000 licenses that are newly obtained
or renewed every five and 10 years,
respectively. After five years, the GMRS
licensee is responsible for renewing the
license (or cancelling) and the
Commission is responsible for
maintaining accurate records of licenses
coming up for renewal—an
administrative burden on both GMRS
users and on the Commission for
renewing and maintaining records of
these licenses. After analyzing the costs
of processing fee payments for GMRS,
we conclude that the Commission’s cost
of collecting and processing this fee
exceeds the payment amount of $25.
Our costs have increased over time and
now that the costs exceed the amount of
the regulatory fee, the increased relative
administrative cost supports eliminating
this regulatory fee category.
11. The Vanity Call Sign fee category
has a small regulatory fee ($21.40 in FY
2014) for a 10-year license. The
Commission often receives multiple
applications for the same vanity call
sign, but only one applicant can be
issued that call sign. In such cases, the
Commission issues refunds for all the
licensee’s mailing address and class of operator
license. 47 CFR 97.17(d). The licensee can request
a specific unassigned but assignable call sign,
known as a vanity call sign. 47 CFR 97.19. There
is no fee for the sequential call sign.
27 GMRS (formerly Class A of the Citizens Radio
Service) is a personal radio service available for the
conduct of an individual’s personal and family
communications. See 47 CFR 95.1. We initially
proposed eliminating regulatory fees for GMRS in
the FY 2008 Report and Order and Further Notice.
See Assessment and Collection of Regulatory Fees
for Fiscal Year 2008, Report and Order and Further
Notice of Proposed Rulemaking, 73 FR 50285,
50290–50291, para 33 (August 26, 2008) (FY 2008
Report and Order and Further Notice). The
Commission has an open proceeding to review the
Part 95, Personal Radio Service rules, which
include GMRS. See Review of the Commission’s
Part 95 Personal Radio Services Rules, WT Docket
No. 10–119, Notice of Proposed Rulemaking and
Memorandum Opinion and Order on
Reconsideration, 75 FR 47142, 47143–47144, para.
4 (August 4, 2010).
28 FY 2014 Report and Order, 79 FR 54190,
54195, para. 26 (September 11, 2014).
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remaining applicants. In addition to
staff and computer time to process
payments and issue refunds, there is an
additional expense to issue checks for
the applicants who cannot be refunded
electronically. The Commission spends
more resources on processing the
regulatory fees and issuing refunds than
the amount of the regulatory fee
payment. As our costs now exceed the
regulatory fee, we are eliminating this
regulatory fee category.
12. The Commission will therefore
eliminate the GMRS and Vanity Call
Sign regulatory fee categories after the
required congressional notification is
provided.29 Once eliminated, these
licensees will no longer be financially
burdened with such payments and the
Commission will no longer incur these
administrative costs that exceed the fee
payments. The revenue that the
Commission would otherwise collect
from these regulatory fee categories will
be proportionally assessed on other
wireless fee categories. This is a
‘‘permitted amendment’’ as defined in
section 9(b)(3) of the Act, which,
pursuant to section 9(b)(4)(B, must be
submitted to Congress at least 90 days
before it becomes effective.30
2. Toll Free Numbers
13. Toll free numbers, defined in
section 52.101(f) of our rules,31 allow
callers to reach the called party without
being charged for the call. Instead, the
charge for the call is paid by the called
party (the toll free subscriber).32 Prior to
the FY 2014 Report and Order, the
Commission did not assess regulatory
fees on toll free numbers based on the
assumption that the entities controlling
the numbers—wireline and wireless
common carriers—were paying
regulatory fees based on either revenues
or subscribers.33 In the FY 2014 NPRM,
we observed this was no longer the case
because many toll free numbers are now
29 After the 90-day notification period for a
permitted amendment, these two fee categories will
be eliminated. We will not be issuing refunds to
licensees who have paid the regulatory fee prior to
the elimination of the fee.
30 47 U.S.C. 159(b)(3).
31 Toll free numbers are telephone numbers for
which the toll charges for completed calls are paid
by the toll free subscriber. See 47 CFR 52.101(f).
These are 800, 888, 877, 866, 855, and 844 numbers.
SMS/800 (or the 800 Service Management System)
is a centralized system that performs toll free
number management. For a list of RespOrgs on the
SMS/800, Inc. Web site, see https://
www.sms800.com/Controls/NAC/
Serviceprovider.aspx.
32 47 U.S.C. 52.101 (e), (f).
33 FY 2014 Report and Order, 79 FR 54190,
54195, para. 28, Footnote 76 (citing Universal
Service Contribution Methodology, Further Notice
of Proposed Rulemaking, 77 FR 33896, 33923, para.
227 (June 7, 2012).
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controlled or managed by RespOrgs 34
that are not common carriers.35 In the
FY 2014 Report and Order, we adopted
a regulatory fee obligation for toll free
numbers beginning in FY 2015, finding
that the Commission has both the legal
authority and responsibility to assess
regulatory fees on toll free numbers.36
This regulatory fee assessed on
RespOrgs for toll free numbers managed
by a RespOrg,37 is payable for all toll
free numbers unless calls from only
other countries can be completed using
those toll free numbers.38 This
regulatory fee is assessed on RespOrgs
for each working, assigned, reserved, in
transit, or any other status of toll free
number as defined in section 52.103 of
the Commission’s rules. Interstate
Telecommunications Service Providers
(ITSPs) that are RespOrgs and RespOrgs
that are not ITSPs will be responsible
for this regulatory fee.
14. The decision in 2014 to expand
the pool of regulatory fee obligations to
all RespOrgs created a system in which
there are now numerous entities that
play a role in toll free number
administration and are required to pay
annual regulatory fees but are not
common carriers and therefore may lack
familiarity with the Commission’s rules.
In the FY 2014 Report and Order, we
did not adopt a specific enforcement
mechanism to address circumstances
where RespOrgs do not make regulatory
fee payments but instead, sought further
comment on the additional procedures
34 A RespOrg is a company that manages toll free
telephone numbers for subscribers. RespOrgs use
the SMS/800 data base to verify the availability of
specific numbers and to reserve the numbers for
subscribers. See 47 CFR 52.101(b).
35 FY 2014 NPRM, 79 FR 37982, 37992, para. 57,
Footnote 91 (citing, inter alia, Telseven, LLC,
Calling 10, LLC, Patrick Hines a/k/a P. Brian Hines,
Notice of Apparent Liability for Forfeiture, 27 FCC
Rcd 15558, 15560, para. 3 (2012) (various
corporations, including non-common carrier
RespOrgs, owned and controlled by Patrick Hines,
controlled approximately one million toll free
numbers for Hines’ ‘‘directory assistance’’
operation.))
36 FY 2014 Report and Order, 79 FR 54190,
54195, para. 28–29 (September 11, 2014)
(summarizing the legal rationale for adoption of a
fee on toll free numbers and the FTEs involved in
toll free issues) (citing Toll Free Access Codes,
Second Report and Order and Further Notice of
Proposed Rulemaking, CC Docket No. 95–155, 62
FR 20126, 20127 (April 25, 1997) (Toll Free Second
Report and Order) (Sections 201(b) and 251(e) of
the Act ‘‘empower the Commission to ensure that
toll free numbers . . . are allocated in an equitable
and orderly manner that serves the public
interest.’’)).
37 The proposed fee rate for toll free numbers for
FY 2015 is in Table C (FY 2015 Notice of Proposed
Rulemaking).
38 See FY 2014 Report and Order, 79 FR 54190,
54195–54196, para. 30 (September 11, 2014).
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for enforcement in such instances.39
Instead of adopting additional
enforcement procedures at this time,
however, we direct SMS/800, Inc.40 to
provide the necessary outreach to the
RespOrgs, through its tariff, Web site, or
otherwise, to advise them that: ‘‘The
Federal Communications Commission
(FCC) has adopted a regulatory fee
category for toll free numbers, assessed
for each toll free number managed by a
Responsible Organization (RespOrg).
This regulatory fee, assessed on
RespOrgs for toll free numbers managed
by a RespOrg, is payable for all toll free
numbers unless calls from only other
countries can be completed using those
toll free numbers. A RespOrg that fails
to pay the regulatory fee assessed by the
FCC will be subject to penalties.’’ 41
15. The imposition of a regulatory fee
on RespOrgs is a new rule, adopted in
the FY 2014 Report and Order, and noncommon carriers may be unfamiliar
with our regulatory fee process and
unaware that delinquencies can result
in penalties imposed by SMS/800, Inc.,
penalties imposed by the Commission
pursuant to the Debt Collection
Improvement Act of 1996 (DCIA), and/
or enforcement action by the
Enforcement Bureau, pursuant to
delegated authority, or by the
Commission.42 As a result, OMD will
coordinate with SMS/800, Inc. to ensure
that all RespOrgs owing regulatory fees
39 FY 2014 Report and Order, 79 FR 63883,
63885, paras. 8–9 (October 27, 2014).
40 SMS/800, Inc. provides administration and
routing for all toll free numbers in North America.
The Commission has the ultimate authority over
numbering resources and oversees the SMS Tariff
and SMS/800 Board. See 47 U.S.C. 251 (e)(1); see
generally Toll Free Service Access Codes, CC Docket
No. 95–155; Petition to Change the Composition of
SMS/800, Inc., WC Docket No. 12–260, 28 FCC Rcd
15328 (2013) (SMS Reauthorization Order).
Previously the Commission required SMS/800, Inc.
to include language prohibiting toll free number
hoarding and warehousing in the SMS Tariff. See
Toll Free Service Access Codes, Second Report and
Order and Further Notice of Proposed Rulemaking,
62 FR 20126, 20127, para. 1 (April 25, 1997).
41 See Toll Free Second Report and Order, 62 FR
20126 (April 25, 1997) (‘‘We also may limit any
RespOrg’s allocation of toll free numbers or
possibly decertify it as a RespOrg under section
251(e)(1) or section 4(i) [of the Communications
Act].’’)
42 The Commission has a number of generally
applicable mechanisms to ensure collection of
delinquent debt which would also apply to
RespOrgs. See generally FY 2014 Report and Order,
79 FR 54190, 54199, paras. 47–48 (September 11,
2014) (summarizing the late payment penalty on
unpaid regulatory fees under 47 U.S.C. 159(c), the
red-light rule set forth in section 1.1910 of the
Commission’s rules, 47 CFR 1.1910, and additional
provisions contained in the Debt Collection
Improvement Act of 1996 (DCIA), 31 U.S.C. 3701
et seq., See Amendment of Parts 0 and 1 of the
Commission’s Rules, MD Docket No. 02–339, Report
and Order, 69 FR 27843 (May 17, 2004); 47 CFR
part 1, subpart O, Collection of Claims Owed the
United States).
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have sufficient information about this
process and opportunity to pay the
regulatory fee before the RespOrg is
placed in red light status and
enforcement procedures are initiated.43
16. The basis for identifying the toll
free number count upon which a
regulatory fee will be assessed for each
RespOrg will be derived from data
provided by SMS/800, Inc.44 The toll
free number data will be determined by
the toll free number count as of or
around December 31st of each year. In
addition to maintaining contact
information with SMS/800, Inc.,
RespOrgs are also responsible for: (i)
Obtaining an FRN (FCC Registration
Number); 45 (ii) maintaining current
contact information in the Commission
Registration System (CORES); 46 (iii)
reviewing the Commission’s Regulatory
Fees Home Page for updates on
regulatory fees; 47 and (iv) making
timely regulatory fee payments using
the Commission’s Electronic Filing and
Payment System (Fee Filer) located at:
www.fcc.gov/feefiler. SMS/800, Inc. will
provide the Commission with up-to-date
contact information for the RespOrgs as
needed to facilitate the timely payment
of regulatory fees for toll free numbers.
Under our bill collection procedures,
delinquent RespOrgs will receive notice
from the Commission before the matter
is referred to the Enforcement Bureau
for enforcement action and/or penalties
imposed by SMS/800, Inc.
17. Any payments RespOrgs must pay
SMS/800, Inc. for toll free number
management and administration are
unrelated to regulatory fees assessed by
the Commission. Payment of regulatory
fees to the Commission does not relieve
a RespOrg from any payment obligations
to SMS/800, Inc.
43 Hypercube Telecom contends that the
consumer end-users would be affected by our
enforcement action against a RespOrg. Hypercube
Telecom Reply Comments at 3–5. The notifications
that are part of our delinquent bill collection
process will give RespOrgs multiple opportunities
to pay any delinquency before enforcement action.
44 SMS/800, Inc. observes that some of its billing
and contact information may contain additional
proprietary and confidential data and that it would
require the Commission to ensure the
confidentiality of any such information provided.
See SMS/800, Inc. Comments at 6. If SMS/800, Inc.
is unable to provide the necessary information
without including any confidential information it
should submit, along with the responsive
information and/or documents, a statement in
accordance with section 0.459 of the Commission’s
rules. 47 CFR 0.459.
45 Commission FRN numbers can be obtained by
registering in the Commission’s Registration System
(CORES) located at: https://apps.fcc.gov/coresWeb/
publicHome.do.
46 Commission’s Registration System (CORES)
located at: https://apps.fcc.gov/coresWeb/
publicHome.do.
47 The Commission’s Regulatory Fees Home Page
is located at: https://www.fcc.gov/regfees.
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3. Direct Broadcast Satellite Providers
18. DBS service is a nationally
distributed subscription service that
delivers video and audio programming
via satellite to a small parabolic ‘‘dish’’
antenna at the subscriber’s location.
DBS providers are multichannel video
programming distributors (MVPDs), as
defined in section 602(13) of the Act.48
These operators of U.S. licensed
geostationary space stations, which are
used to provide one-way subscription
video service to consumers in the
United States, currently pay a fee per
U.S.-licensed satellite under the
category ‘‘Space Station (Geostationary
Orbit)’’ in the regulatory fee schedule
based on the International Bureau FTEs
work associated with satellite
regulation. Cable television and IPTV,
also MVPDs, similarly provide
subscription video services to
consumers in the United States. These
regulated entities pay a regulatory fee
per subscriber under the fee category
‘‘Cable TV System, Including IPTV.’’ 49
In the Further Notice of Proposed
Rulemaking accompanying the FY 2014
Report and Order, the Commission
proposed to adopt a fee to recover the
costs incurred by the Media Bureau for
regulation of DBS.50 Under our
proposal, DBS providers would be
subject to two regulatory fees. The first
fee would recover the burden of
regulation and oversight by
International Bureau FTEs incurred as a
result of its operation of satellites, and
the other fee would recover the burden
of regulation and oversight by Media
Bureau FTEs as a result of DBS status
as a MVPD. We conclude that DBS
providers are subject to regulation and
oversight of the Media Bureau and
should share in the Media Bureau FTE
burden attributed to MVPDs.
Accordingly, pursuant to section 9(b)(3),
we amend the regulatory fee schedule to
replace the category ‘‘Cable TV System,
Including IPTV’’ with the ‘‘Cable TV
System, Including IPTV and DBS’’
category. This category will now have
two rates: One for DBS (a subcategory)
and another for cable television and
IPTV.
19. Background. The Commission has
considered the appropriate methodology
for assessing regulatory fees on DBS
providers on multiple occasions. The
48 47
U.S.C. 522(13).
FY 2014, the regulatory fee for ‘‘Cable TV
System, Including IPTV’’ was $0.99 per subscriber.
FY 2014 Report and Order, 79 FR 54190, 54208–
54212 (September 11, 2014). Cumulatively, the
Cable TV System, Including IPTV fee category paid
$64.35 million in regulatory fees for FY 2014.
50 FY 2014 Further Notice of Proposed
Rulemaking, 79 FR 63883, 63886–63887, paras. 10–
15 (October 27, 2014).
49 In
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original fee schedule adopted by
Congress in 1993, when the DBS service
was a nascent industry,51 did not
include a specific fee category for DBS
providers.52 The Commission
recognized this and declined to adopt a
regulatory fee for DBS until fiscal year
1996.53 In the FY 1996 NPRM, the
Commission determined that including
the fledgling DBS service in the
regulatory fee imposed on geostationary
orbit geosynchronous satellite category
best reflected the regulatory burden
born by the Commission at that time.54
51 Implementation of Section 9 of the
Communications Act, Assessment and Collection of
Regulatory Fees for the 1994 Fiscal Year, Report
and Order, 59 FR 30984, 30994, para. 85 (June 16,
1994) (FY 1994 Report and Order) (declining to
adopt a regulatory fee for DBS under the Mass
Media fees and noting that DBS service is not
expected to be offered prior to the time for
calculating fee payments for FY 1994).
52 In the Appendix to the FY 1994 Report and
Order published in the Federal Register, the
Commission noted that DBS was not included in
the original fee schedule adopted by Congress and
observed ‘‘that the omission of DBS and FM
translators and boosters was inadvertent and that
Congress did not intend to exempt all DBS
permittees and licensees and licensees of FM
translators and boosters from regulatory fees as
these services result in the Commission incurring
costs for necessary regulatory functions. . . . we
intend to add regulatory fee categories for DBS
licenses and for FM translators and boosters. . . .’’
59 FR 30984, 31006, note 2.
53 Assessment and Collection of Regulatory Fees
for Fiscal Year 1996, Report and Order, 61 FR
36629, 36652, para 35 in Appendix F (July 12, 1996)
(FY 1996 Report and Order) (imposing regulatory
fee for the first time on DBS relying on the analysis
in the FY 1996 NPRM); Assessment and Collection
of Regulatory Fees for Fiscal Year 1996, Notice of
Proposed Rulemaking, 61 FR 16432, 16436, para.
41(April 15, 1996) (FY 1996 NPRM) (proposing to
assess DBS licensees the fee applicable to all
geostationary orbit geosynchronous satellite
licensees and, therefore, to include DBS for
regulatory fee purposes in the Space Station fee
category).
54 FY 1996 NPRM, 61 FR 16432, 16436, para.41
(April 15, 1996).
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In the 2005,55 2006,56 and 2008 57
regulatory fee proceedings, the
Commission also considered whether
DBS should pay a subscriber-based
regulatory fee related to Media Bureau
oversight instead of being included in
the geosynchronous satellite category
related to International Bureau
oversight. In those proceedings, the
Commission either declined to adopt a
change or made no decision on the
issue. In the FY 2005 Report and Order,
in declining to make a change, the
Commission noted its FY 2005 NPRM
had not contained a proposal on the
issue.58 In the FY 2006 Report and
Order, the Commission decided not to
change the fee. In the FY 2009 Report
and Order, the Commission declined to
address the issue raised in the FY 2008
Report and Order and Further Notice.59
20. In August of 2012, the GAO
Report concluded that regulatory fee
reform at the Commission was long
overdue.60 The GAO Report observed,
among other things, that questions had
been raised by commenters regarding
whether the Commission’s regulatory
55 Assessment and Collection of Regulatory Fees
for Fiscal Year 2005, Report and Order and Order
on Reconsideration, 70 FR 41967, 41969, para 11
(July 21, 2005) (FY 2005 Report and Order). In 2005,
the Commission declined to adopt changes in the
regulatory fee assessment methodology for DBS
providers in response to the comments of the
National Cable and Telecommunications
Association and American Cable Association. Id.
The FY 2005 NPRM did not contain a proposal on
this issue. See generally, Assessment and Collection
of Regulatory Fees for Fiscal Year 2005, Notice of
Proposed Rulemaking, 70 FR 9575 (February 28,
2005).
56 Assessment and Collection of Regulatory Fees
for Fiscal Year 2006, Report and Order, 71 FR
43842, 43844–43845, paras. 10–16 (August 2, 2006)
(FY 2006 Report and Order) (declining to change
the DBS regulatory fee from a per operational space
station fee to a subscriber based fee); Assessment
and Collection of Regulatory Fees for Fiscal Year
2006, Notice of Proposed Rulemaking, 71 FR 17410,
17411–17412, para. 8 (June 6, 2006) (FY 2006
NPRM) (seeking comment on the appropriate
regulatory fee structure for both cable operators and
DBS providers).
57 FY 2008 Report and Order and Further Notice,
73 FR 50285, 50290, para. 26 (August 26, 2008)
(seeking comment on whether the Commission
should impose the same per subscriber fee on DBS
that cable providers pay, or continue to assess a
space station regulatory fee for the DBS industry
and a subscriber-based structure for the cable
industry).
58 FY 2005 Report and Order, 70 FR 41967,
41969, para. 11 (July 21, 2005).
59 Assessment and Collection of Regulatory Fees
for Fiscal Year 2009, Report and Order, 74 FR
40089, 40089, para 3 (August 11, 2009) (FY 2009
Report and Order) (the Commission noted that the
remaining outstanding issues from the FY 2008
Report and Order and Further Notice would be
decided at a later time).
60 See note 22, supra. We have adopted
significant regulatory fee reforms in our annual
regulatory fee proceedings in response to the GAO
Report. See, e.g., FY 2013 Report and Order, 78 FR
52433, 52436, para. 12–14 (August 23, 2013) (using
current FTE data to calculate regulatory fees).
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fee analysis was based on a ‘‘valid FTE
analysis’’ of Media Bureau FTEs work
related to the MVPDs including DBS.61
Following the GAO Report, in the fiscal
year 2013 regulatory fee proceeding, the
Commission considered and adopted a
number of significant regulatory fee
reforms such as updating the FTEs
allocated to each of the core bureaus
and reclassifying most of the
International Bureau FTEs as indirect.62
The Commission also adopted other
reforms such as broadening the cable
television category to include IPTV
providers as a ‘‘permitted
amendment.’’ 63 As part of its overall
analysis of the cable television systems
category, the Commission considered a
change to the DBS fee schedule.64 While
the Commission declined to do so in
2013 to allow additional time to
examine the proposal as part of larger
reform efforts, the Commission noted its
intent to revisit the issue in the future.65
In 2014, the Commission again
proposed to adopt a fee to recover the
costs incurred by the Media Bureau for
regulation of DBS in the FY 2014 NPRM
and the FY 2014 Further Notice of
Proposed Rulemaking.66 Alternatively,
the Commission sought comment on
whether Media Bureau FTEs working on
DBS issues be assigned to the
International Bureau as direct FTEs or
assigned as indirect FTEs for regulatory
fee purposes.67
21. Discussion. Under section 9 of the
Act, the Commission may make a
permitted amendment to the fee
schedule if it ‘‘determines that the
61 GAO
Report at 18–20.
FY 2013 Report and Order, 78 FR 52433,
52436–52438, para. 12–22 (August 23, 2013).
63 FY 2013 Report and Order, 78 FR 52433,
52439, 52444, paras. 31, 36 (August 23, 2013).
64 FY 2013 Report and Order, 78 FR 52433,
52443–52444, paras. 35–36 (August 23, 2013);
Assessment and Collection of Regulatory Fees for
Fiscal Year 2013, Notice of Proposed Rulemaking
and Further Notice of Proposed Rulemaking, 78 FR
34612, 34627–34628, paras. 56–58 (June 10, 2013)
(FY 2013 NPRM).
65 FY 2013 Report and Order, 78 FR 52433,
52439, para. 31 (August 23, 2013) (‘‘We will
continue to examine these suggestions as we
continue our regulatory fee reform, as well as our
proposals that we do not reach in this Report and
Order: To combine the ITSP and wireless
categories, to use revenues in calculating all
regulatory fees, and to include DBS providers in a
new MVPD category. We find additional time is
necessary and appropriate to examine these
proposals under Section 9 of the Communications
Act and analyze how these proposals account for
changes in the communications industry and the
Commission’s regulatory processes and staffing.’’)
(footnotes omitted) and para. 33.
66 FY 2014 Further Notice of Proposed
Rulemaking, 79 FR 63883, 63885–63886, paras. 10–
15 (October 27, 2014); FY 2014 NPRM, 79 FR 37982,
37990–37991, paras. 47–52 (July 3, 2014).
67 FY 2014 Further Notice of Proposed
Rulemaking, 79 FR 63883, 63886, para. 13 (October
27, 2014).
62 See
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Schedule requires amendment to
comply with the requirements of’’
paragraph (1)(A) which mandates that
the Commission allocate fees to cover
the costs of certain regulatory activities
in accordance with the benefits
provided to the payor and other factors
that the Commission determines are in
the public interest.68 The statute also
provides, however, that, ‘‘[i]n making
such amendments, the Commission
shall add, delete, or reclassify services
in the Schedule to reflect additions,
deletions or changes in the nature of its
services as a consequence of
Commission rulemaking proceedings or
changes in law.’’ 69 We have conducted
a review of the Media Bureau work
devoted to MVPD matters and find that
the recommendations in the GAO
Report were correct.70 Analysis of the
oversight and regulation of MVPDs
(including the DBS industry) by the
Media Bureau in various rulemaking
proceedings reveal a cumulative effect
of changes in law that have taken effect
since the Commission adopted the
current DBS regulatory fee structure in
1996. Due to these changes, we find that
the DBS providers should be included
in the same fee category as the other
MVPDs, such as cable television and
IPTV. There are certain rules that both
DBS providers and cable operators
including IPTV are subject to, and
Media Bureau FTEs provide the
oversight and regulation of the DBS
industry as required by these rules.71
For example, DBS providers (and cable
television operators) are permitted to
file program access complaints 72 and
complaints seeking relief under the
retransmission consent good faith
rules.73 In addition, DBS providers are
subject to MVPD requirements such as
those pertaining to program carriage 74
and the requirement to negotiate
retransmission consent in good faith.75
More recently, the Commission adopted
a host of requirements that apply to all
MVPDs and thus equally apply to DBS
providers as part of its implementation
68 47
U.S.C. 159(b)(3).
U.S.C. 159(b)(3).
70 The GAO Report did not have a specific
recommendation with respect to the DBS regulatory
fee, but observed that the National Cable and
Telecommunications Association had argued that
our regulatory fee process was competitively
disadvantaging the cable television industry. GAO
Report at 18–19. Competition per se is not part of
the permitted amendment analysis; however, in this
case the Media Bureau FTEs work on MVPD issues
that include DBS.
71 See, e.g., 47 CFR 76.65(b); 76.1000–1004; 47
U.S.C. 618(b).
72 47 U.S.C. 548; 47 CFR 76.1000–1004.
73 47 U.S.C. 325(b)(1), (3)(C)(ii); 47 CFR 76.65(b).
74 47 U.S.C. 536; 47 CFR 76.1300–1302.
75 47 U.S.C. 325(b)(3)(C)(iii); 47 CFR 76.65(a)–(b).
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of the Commercial Advertisement
Loudness Mitigation Act (CALM Act),76
the Twenty-First Century
Communications and Video
Accessibility Act of 2010 (CVAA),77 as
well as the Satellite Television
Extension and Localism Act (STELA)
Reauthorization Act of 2014
(STELAR).78 These regulatory
developments increased the amount of
regulatory activity by the Media Bureau
FTEs involving regulation and oversight
of MVPDs, including the DBS providers.
The Media Bureau has been responsible
for adopting many of these regulations
and overseeing the MVPD industry. As
MVPDs, DBS providers actively
participate in Media Bureau
proceedings involving MVPD oversight
and regulation.79
22. DIRECTV and DISH disagree that
a permitted amendment is justified,
contending that there has been no
‘‘meaningful increase in the regulation
of DBS.’’ 80 To the contrary, as discussed
above, implementation of the CALM
Act, CVAA, and STELAR should alone
provide adequate justification for a
permitted amendment in this case. A
permitted amendment under section
9(b)(3), however, does not require a
sudden increase in regulation or
oversight over a defined period of time.
Circumstances have changed in the
almost 20 years since the Commission
first addressed the issue of DBS
regulatory fees.81 At the time we
Implementation of the Commercial
Advertisement, Loudness Mitigation (CALM) Act,
Report and Order, 77 FR 40276 (July 9, 2012)
(CALM Act Report and Order).
77 Public Law 111–260, 124 Stat. 2751 (2010). See
also Amendment of Twenty-First Century
Communications and Video Accessibility Act of
2010, Public Law 111–265, 124 Stat. 2795 (2010)
(making corrections to the CVAA); 47 CFR part 79.
78 The STELA Reauthorization Act of 2014
(STELAR), 102, Public Law 113–200, 128 Stat.
2059, 2060–62 (2014) (codified at 47 U.S.C. 338(1)).
The STELAR was enacted on Dec. 4, 2014 (H.R.
5728, 113th Cong.). Implementation of Section 102
of the STELA Reauthorization Act of 2014, Notice
of Proposed Rulemaking, MB Docket No. 15–71,
FCC 15–34 (rel. Mar. 26, 2015) proposes satellite
television ‘‘market modification’’ rules to
implement section 102 of STELAR.
79 NCTA and ACA Comments at 7, 10–11; ITTA
Comments at 3. DIRECTV and DISH filed comments
and ex parte statements in numerous Commission
proceedings, in the Media Bureau dockets as well
as other dockets. As of Mar. 17, 2015, in the past
12 months, DIRECTV filed 109 comments and ex
parte statements in Media Bureau (and other)
dockets. There are other proceedings, such as
mergers, in which DIRECTV and DISH have
participated. Regardless of whether the proceeding
is merger-related or pertains strictly to MVPD
regulation, DBS participation, and Media Bureau
staff involvement, support our conclusion that DBS
providers should be added to the cable television
and IPTV category.
80 DIRECTV and DISH Comments at 8–9.
81 The Commission’s annual MVPD Competition
Report provides a history of MVPD services. Annual
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adopted a DBS regulatory fee, it was a
fledging service where the business
model was uncertain and there were
questions concerning whether it would
operate as a subscription based service
or a free to air broadcaster.82 The first
DBS satellite was not launched until
1993 and did not become operational
until 1994.83 In 2015, however, DBS had
developed into a large MVPD 84 and as
such significant Media Bureau FTE
resources are used in regulation and
oversight of DBS. The GAO Report
correctly noted that an evaluation of
Media Bureau FTEs was long overdue 85
and the result of such evaluation leads
us to the conclusion that the Media
Bureau FTEs regulate the DBS industry
together with the other MVPDs. Thus,
there is no reasonable basis to exclude
DBS providers from sharing in the cost
of MVPD oversight and regulation. With
this Report and Order, we recognize the
changes in fact and law since the
adoption of the DBS fee in 1996
cumulatively require us to adopt a
permitted amendment to ensure that
DBS providers contribute equitably to
the FTE burden of MVPD oversight.86
23. We also reject the argument raised
by DIRECTV and DISH that section 9 of
the Act requires us to ‘‘show that DBS
and cable occupy a comparable number
of FTEs.’’ 87 The commenters’ argument
that DBS is not involved in certain
matters such as petitions for effective
Assessment of the Status of Competition in the
Market for the Delivery of Video Programming,
Report, 9 FCC Rcd 7442 (1994) (First Report); 11
FCC Rcd 2060 (1996) (Second Report); 12 FCC Rcd
4358 (1997) (Third Report); 13 FCC Rcd 1034 (1998)
(Fourth Report); 13 FCC Rcd 24284 (1998) (Fifth
Report); 15 FCC Rcd 978 (2000) (Sixth Report); 16
FCC Rcd 6005 (2001) (Seventh Report); 17 FCC Rcd
1244 (2002) (Eighth Report); 17 FCC Rcd 26901
(2002) (Ninth Report); 19 FCC Rcd 1606 (2004)
(Tenth Report); 20 FCC Rcd 2755 (2005) (Eleventh
Report); 21 FCC Rcd 2503 (2006) (Twelfth Report);
24 FCC Rcd 542 (2007) (Thirteenth Report); 27 FCC
Rcd 8610 (2012) (Fourteenth Report); 28 FCC Rcd
10496 (2013) (Fifteenth Report).
82 FY 1996 Report and Order, 61 FR 36629,
36652, Appendix F, para. 35 (July 12, 1996). DBS
space stations applicants must indicate in their
license application whether they seek to operate on
a broadcast or non-broadcast basis, which affects
the length of their license terms. Inquiry into the
Development of Regulatory Policy in regard to
Direct Broadcast Satellites for the Period Following
the 1982 Regional Administrative Radio
Conference, Report and Order, 90 FCC 2d 676
(1982), aff’d sub nom National Association of
Broadcasters v. F.C.C., 740 F.2d 1190 (1984). To
date, neither DIRECTV nor DISH has elected to
operate as a broadcaster.
83 First Report, 59 FR 64657, 64659, paras. 21–22
(December 15, 1994).
84 Fifteenth Report, 28 FCC Rcd at 10546–49,
paras. 110–117 (describing DBS MVPD business
models and competitive strategies).
85 GAO Report at 17–20.
86 47 U.S.C. 159(b)(3). See, e.g., 47 CFR 76.65(b);
76.1000–1004; Part 79; 47 U.S.C. 618(b).
87 DIRECTV and DISH Comments at 11 & Reply
Comments at 4–9.
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competition,88 or other requirements
that do not pertain to DBS,89
demonstrates that DBS is not identical
to cable television. It does not, however,
refute our conclusion that a significant
number of Media Bureau FTEs work on
MVPD issues that include DBS.90 The
Commission has determined in other
proceedings that services that are not
technologically identical nevertheless
warrant placement in the same
regulatory fee category. Other fee
categories, such as Interstate
Telecommunications Service Providers
(ITSP), also include a range of carriers
that may not be regulated identically.91
For example, when interconnected
Voice over Internet Protocol (VoIP)
providers were added to the ITSP
category in a permitted amendment the
Commission observed that ‘‘the costs
and benefits associated with our
regulation of interconnected VoIP
providers are not identical as those
associated with regulating interstate
telecommunications service and
CMRS.’’ 92 The Commission stated that
‘‘Section 9 is clear, however, that
regulatory fee assessments are based on
the burden imposed on the Commission,
not benefits realized by regulatees.’’ 93
Concerning many aspects of MVPD
regulation, Media Bureau FTEs bear the
same burden regardless of the specific
technology used by the service provider.
Thus, although DBS is not identical to
cable television and IPTV, the services
all receive oversight and regulation as a
result of the work of Media Bureau FTEs
on MVPD issues. The burden imposed
on the Commission is therefore similar.
24. DIRECTV and DISH also observe
that there are more cable operators and
cable systems than DBS operators, and
that the cable industry has a larger filing
88 DIRECTV
and DISH Comments at 12.
and DISH Comments at 12 (these are
(1) a requirement to encrypt the basic service tier,
(2) the viewability requirements in sections 614 and
615 of the Act, and (3) the requirement to include
certain digital interfaces on high definition set-top
boxes).
90 See, e.g., Closed Captioning Report and Order,
79 FR 17911 (March 31, 2014), 79 FR 17093 (March
31, 2014); CALM Act Report and Order, 77 FR
40276 (July 9, 2012); 76.1000–1004; part 79; 47
U.S.C. 618(b).
91 ITSP, regulated by the Wireline Competition
Bureau, includes interexchange carriers (IXCs),
incumbent local exchange carriers (LECs), toll
resellers, Voice over Internet Providers (VoIP), and
other service providers, all of which involve
different degrees of regulatory oversight. See NCTA
and ACA Comments at 9 & Reply Comments at
8–9.
92 See Assessment and Collection of Regulatory
Fees for Fiscal Year 2007, Report and Order and
Further Notice of Proposed Rulemaking, 72 FR
45908, 45912, para. 19 (August 16, 2007) (FY 2007
Report and Order).
93 FY 2007 Report and Order, 72 FR 45908,
45912, para. 19 (August 16, 2007).
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and recordkeeping requirement than
DBS.94 While we agree that the two DBS
providers and their trade association
had fewer filings than the top 25 cable
operators and their two trade
associations (combined), we are not
persuaded that this demonstrates a lack
of Media Bureau oversight and
regulation of the DBS industry.95 We are
therefore including DBS providers into
the same regulatory fee category as cable
television and IPTV because many
Media Bureau issues involve the entire
MVPD industry. We find that it is
appropriate under section 9 of the Act
to recover the costs associated with
Media Bureau FTE work.96 As we
explain below, however, DBS will have
an opportunity to raise questions
concerning the rate calculation between
it and other members of the same fee
category for fiscal year 2015 and in the
future.97 The video programming and
distribution industry continues to
change 98 and the appropriate allocation
between and among regulatees with
respect to Media Bureau FTEs working
on MVPD issues may change over time
as different regulatory and legal issues
are presented to the Commission.
25. To the extent that DIRECTV and
DISH are suggesting by these arguments
that the number of FTEs dedicated to a
service is wholly determinative of their
regulatory fees, we disagree. Although
the statute requires us to calculate FTEs
initially, we are also required to
‘‘adjust[]’’ that number ‘‘to take into
94 DIRECTV and DISH Comments at 13. DIRECTV
and DISH compare the number of filings in our
electronic comment filing system (ECFS) and
observe that over a two year period DIRECTV and
DISH and their trade association filed 4,870 pages
in 401 proceedings and the top 25 cable companies
and their two trade associations filed 93,673 pages
in 2,217 proceedings. DIRECTV and DISH
Comments at 13, note 53.
95 In the 12 months prior to Mar. 17, 2015,
Comcast Corporation (the largest cable company in
the country) had 297 total ECFS filings, DIRECTV
had 109, and DISH Network had 134 (some filings
were by DIRECTV and DISH together), a not
unexpected relative volume of ECFS filings for the
top three MVPDs in the country.
96 47 U.S.C. 159(a)(1).
97 Even when an industry has oversight generally
by one organizational unit within the Commission,
we are sensitive to the fact that balance between
members of the same industry may require
adjustments to FTE allocations. See, e.g., recent
changes in FTE allocations between space station
and earth stations even though such systems are
may operate in the same spectrum and be part of
the same telecommunication system. FY 2014
Report and Order, 79 FR 54190, 54192–54193,
paras. 11–15 (September 11, 2014).
98 See, e.g., Promoting Innovation and
Competition in the Provision of Multichannel Video
Programming Distribution Services, Notice of
Proposed Rulemaking, 29 FCC Rcd 15995 (2014)
(seeking comment on, inter alia, expanding the
definition of MVPD to include providers of multiple
linear streams of video programming, regardless of
the technology used to distribute it.)
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account factors that are reasonably
related to the benefits provided to the
payor of the fee by the Commission’s
activities.’’ 99 Since DBS providers
generally benefit from the regulatory
activities of the Media Bureau, much
like cable operators and IPTV providers,
the Commission can attribute Media
Bureau FTEs to DBS providers and
require them to pay Media Bureau
regulatory fees.
26. DIRECTV and DISH also argue
that because we declined to include
DBS in the cable television and IPTV
regulatory fee category previously, we
must provide a reasoned explanation for
changing our fee determination.100 We
agree that it serves the public interest to
explain our rationale. A prior decision,
however, does not preclude us from
making a different determination in
light of the facts and circumstances
presented to the Commission in 2015.
When the Commission first determined
to include DBS in the geosynchronous
satellite regulatory fee, DBS was a new
service with an uncertain business
model. Imposing a subscription based
fee derived from Media Bureau FTEs
risked failing to compensate the
Commission for the substantive work
regulating DBS as a satellite industry.101
When we examined the issue again in
2005, 2006, and 2008,
contemporaneously there was a
significant amount of regulatory work
being done by the International Bureau
related to making new spectrum
available for satellite based video
services.102 Thus, it is not surprising
that the Commission concluded in 2006
that the existing methodology
99 47
U.S.C. 159(b)(1)(A).
and DISH Comments at 15–17 &
Reply Comments at 10–11.
101 FY 1996 NPRM, 61 FR 16432, 16436, para. 41
(April 15, 1996) (‘‘Moreover, because DBS licensees
are not restricted to the provision of video
programming, but rather may provide various nonvideo services, we concluded that a facility-based
fee would ensure that each DBS licensee
contributed equitably to the cost of DBS regulation
without the need to impose possibly burdensome
and overly intrusive reporting requirements
necessary to gather information identifying the
services offered by individual DBS operators.’’)
102 Establishment of Policies and Service Rules for
the Broadcasting Satellite Service at the 17.3–17.7
GHz Frequency Band and at the 17.7–17.8 GHz
Frequency Band Internationally, and at the 24.75–
25.25 GHz Frequency Band for Fixed Satellite
Services Providing Feeder Links to the
Broadcasting-Satellite Service and for the
Broadcasting Satellite Service Operating
Bidirectionally in the 17.3–17.7 GHz Frequency
Band, Notice of Proposed Rulemaking, 72 FR 46939
(August 22, 2007), Report and Order and Further
Notice of Proposed Rulemaking, 72 FR 50000
(August 29, 2007); Amendment of the Commission’s
Policies and Rules for Processing Applications in
the Direct Broadcast Satellite Service, Notice of
Proposed Rulemaking, 21 FCC Rcd 9443 (2006). See
Thirteenth Report, 74 FR 11102, at para. (March 16,
2009).
100 DIRECTV
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adequately ensured recovery of
International Bureau FTE burden of
oversight and regulation. Further,
removing DBS from the geosynchronous
satellite regulatory fee category at a time
when that fee category bore the burden
of substantial rulemakings relating to
new satellite spectrum would have been
a complex issue. While the burden of
new satellite rulemakings was not
mentioned by the Commission in the FY
2006 Report and Order, review of the
context in which decisions are made is
appropriate here. Further, in the past,
changes to the DBS regulatory fee was
frequently described as either a fee
assessed based on International Bureau
FTEs or a fee based on Media Bureau
FTEs. In contrast, our proposal presents
a more nuanced approach of recognizing
that the work of both the International
Bureau FTEs and the Media Bureau
FTEs provide oversight and regulation
of DBS. As a result, while the decisions
made in the past are understandable in
their context, we are not bound to
disregard the FTE burden born by the
Media Bureau in regulating DBS as a
MVPD simply because we previously
declined to change the methodology of
assessing fees on DBS providers.
27. Regulatory fee reform is a
logistical challenge due to the time
constraints in regulatory fee proceedings
which typically must be completed in a
year in order to satisfy our statutory
mandate. Unfortunately, at times we
must decline to adopt a proposal or take
an incremental approach, not because a
proposal lacks merit, but simply
because there is insufficient time to
address the substantive comments
raised in the record in the time
allotted.103 In this instance, however,
we have the benefit of comments
regarding this issue from the FY 2013
NPRM, the FY 2014 NPRM, and the FY
2014 Further Notice of Proposed
Rulemaking. As a result, unlike prior
review of this issue, we have had more
time within which to review the
significant issue of adopting an
additional fee category for DBS
providers. The GAO Report also brought
new focus to conducting the necessary
analysis of Media Bureau FTEs as part
of our overall regulatory fee reform.104
Had the Commission performed this
analysis of Media Bureau FTEs and
103 See, e.g., FY 2006 Report and Order, 71 FR
43842, 43845, para 16 (August 6, 2006) (‘‘Finally,
as a practical matter, we do not have sufficient time
available to modify the section 9 regulatory fee
classification and methodology as proposed by
NCTA and still comply with the 90-day
congressional notification requirement before we
start our regulatory fee collections in the August/
September time frame.’’)
104 See, e.g., FY 2013 Report and Order, 78 FR
52433, 52436, paras. 12–14 (August 23, 2013).
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regulation and oversight of DBS earlier,
we may have reached this result at that
time. The Commission may update its
regulatory fee methodology when,
among other things, it is supported by
updated data, analysis, and changes in
the regulation and oversight of the
industry. As the GAO Report observed,
it is important to ‘‘regularly update
analyses to ensure that fees are set based
on relevant information.’’ 105
28. Finally, DISH and DIRECTV
contend that a ‘‘fee increase will cause
rate shock’’ 106 and argue that we must
explain the basis of any regulatory fee
increase exceeding 7.5 percent relying
upon a cap we adopted for FY 2013.107
We note first that it is somewhat
premature to address this concern since
the rate for DBS providers is merely
proposed in the accompanying NPRM,
and DISH and DIRECTV, the two DBS
providers, may provide comments on
the rate for this year and in subsequent
years. As to the substance of the
complaint, we note that this cap was
adopted due to the significant regulatory
fee changes adopted that year and our
concern on the impact on small entities;
neither DISH nor DIRECTV claim that
they are small entities. We are not
required to adopt a cap every year and
we are not seeking comment on such a
cap for FY 2015 in our NPRM above.
Due to their concern that the regulatory
fee would have such an impact on their
customers, we have decided to phase in
the DBS fee and introduce it initially as
a subcategory of the cable television and
IPTV category.108 This phased approach
is consistent with the interim approach
the Commission took in the FY 2013
Report and Order to ‘‘avoid sudden and
large changes in the amount of fees’’ 109
and addresses DIRECTV and DISH’s
concerns.110
29. We also note that we sought
comment on whether the operator of the
satellite or the provider of DBS service
should be the entity that pays the
regulatory fee.111 As the fee is based on
Report at 12.
and DISH Comments at 11.
107 DIRECTV and DISH Comments at 15–17 &
Reply Comments at 10–11.
108 Commenters propose a three-year phase-in
period. See NCTA and ACA Comments at 14–15.
109 FY 2013 Report and Order, 78 FR 52433,
52439, para. 28 (August 23, 2013).
110 In FY 2014, DIRECTV and DISH paid
approximately $2.49 million in international
regulatory fees for 20 satellites and 141 earth
stations. Assuming these DBS providers pay for the
same number of satellite and earth station units, the
Commission estimates that in FY 2015 their total
fees paid would be $2.72 million (satellites and
earth stations) plus $2.72 million (media services)
for a total of $5.44 million.
111 FY 2014 Further Notice of Proposed
Rulemaking, 79 FR 63883, 63886, para. 13 (October
27, 2014).
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105 GAO
106 DIRECTV
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subscriber numbers, the DBS service
provider would be the entity with this
information and it would be more
efficient for those DBS providers to be
responsible for the regulatory fee. For
purposes of calculating regulatory fees,
the subscriber count includes single
family dwellings as well as individuals
in multiple dwelling units (e.g.,
apartments, condominiums, mobile
home parks) based on the formula in the
footnote below.112
30. In the FY 2014 Further Notice of
Proposed Rulemaking, we further
sought comment on whether, in lieu of
a permitted amendment, Media Bureau
FTEs working on DBS issues should be
assigned to the International Bureau as
direct FTEs or assigned as indirect
FTEs.113 These alternatives would, in
some ways, allocate the Media Bureau
FTEs for regulatory fee purposes in a
way that is fairer than the current
allocation. DBS providers would be
paying regulatory fees for some of the
Media Bureau FTEs, if reallocated as
direct FTEs to the International Bureau.
If we reallocated some Media Bureau
FTEs as indirect, the regulatory fee
burden would be spread among all
regulatory fee payors, which would
relieve the burden on the cable
television and IPTV industry. Although
these two alternatives would serve to
reallocate a portion of the Media Bureau
FTEs, such reallocation would either
shift the burden to all International
Bureau regulatees or to all regulatory fee
payors, instead of to the DBS providers.
Thus, although those two alternative
proposals might be an improvement
over the status quo, including DBS in
the same category as cable television
and IPTV, and basing the regulatory fee
on Media Bureau FTEs, is the more
straightforward and equitable approach
because the DBS regulation and
oversight is done by the Media Bureau
FTEs.
31. Under section 9 of the Act, the
Commission must add, delete, or
reclassify services in the fee schedule to
reflect additions, deletions, or changes
in the nature of its services ‘‘as a
112 DBS providers, cable television system
operators, and IPTV providers 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. Providers and operators may base their
count on ‘‘a typical day in the last full week’’ of
December 2014, rather than on a count as of
December 31, 2014.
113 FY 2014 Further Notice of Proposed
Rulemaking, 79 FR 63883, 63886, para. 13 (October
27, 2014).
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consequence of Commission rulemaking
proceedings or changes in law.’’ 114 As
explained above, after analyzing the
oversight and regulation of MVPDs
(including DBS) by the Media Bureau in
various rulemaking proceedings,
MVPDs (including DBS providers) are
subject to increased regulation and
oversight due to changes in law, and
therefore DBS should be included in the
same fee category as cable television
and IPTV, as a permitted amendment.
Since two different sets of FTE
resources are involved, the Commission
is assessing two separate fees on DBS
providers, a satellite fee based on
International Bureau FTEs and a fee
based on Media Bureau FTEs, assessed
per DBS subscriber. This adoption of a
fee subcategory for DBS within the cable
television and IPTV category is a
permitted amendment as defined in
section 9(b)(3) of the Act, which,
pursuant to section 9(b)(4)(B), must be
submitted to Congress at least 90 days
before it becomes effective.115
32. In the Order portion of the
rulemaking, the Commission makes
ministerial changes to sections 1.911(d),
1.1912(b)(1), and 1.1917(c) of the
Commission’s rules 116 to conform to the
Digital Accountability and
Transparency Act (DATA Act).117 In
particular, the Commission amends the
rule provisions to specify that debts
owed to the Commission that have been
delinquent for a period of 120 days shall
be transferred to the Secretary of the
Treasury.118 These amendments are to
conform the Commission’s rules to the
DATA Act and the notice and comment
and effective date provisions of the
Administrative Procedure Act are
inapplicable.119
Final Regulatory Flexibility Analysis
1. As required by the Regulatory
Flexibility Act of 1980, as amended
(RFA),120 an Initial Regulatory
Flexibility Analysis (IRFA) was
included in the Report and Order and
Further Notice of Proposed
Rulemaking.121 The Commission sought
written public comment on these
proposals including comment on the
114 47
U.S.C. 159(b)(3).
U.S.C. 159(b)(4)(B).
116 47 CFR 1.1911(d), 1.1912(b)(1), 1.1917(c).
117 31 U.S.C. 3716(c)(6).
118 The full text of the new rules is contained in
the Rule Change section of this document.
119 5 U.S.C. 553(b)(3)(A).
120 5 U.S.C. 603. The RFA, 5 U.S.C. 601–612 has
been amended by the Small Business Regulatory
Enforcement Fairness Act of 1996 (SBREFA), Public
Law 104–121, Title II, 110 Stat. 847 (1996).
121 Assessment and Collection of Regulatory Fees
for Fiscal Year 2014, Report and Order and Further
Notice of Proposed Rulemaking, MD Docket No. 14–
92, 79 FR 63883 (October 27, 2014) (Further Notice).
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115 47
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IRFA. This Final Regulatory Flexibility
Analysis (FRFA) conforms to the
IRFA.122
A. Need for, and Objectives of, the
Report and Order
2. In this Report and Order, we
eliminate two categories from the
regulatory fee schedule: Amateur radio
Vanity Call Signs and General Mobile
Radio Service (GMRS). We also include
direct broadcast satellite (DBS)
providers in the cable television and
IPTV regulatory fee category, as a
subcategory. To aid in the
implementation of new regulatory fees
for Responsible Organizations
(RespOrgs) adopted in the fiscal year
2014 proceeding, we direct the
Managing Director to coordinate with
SMS/800, Inc. to ensure that all
RespOrgs owing regulatory fees have
sufficient information about this process
and opportunity to pay the regulatory
fee before the RespOrg is placed in red
light status and enforcement procedures
are initiated.
3. Our regulatory fee for DBS
providers, adopted herein, will include
DBS providers in the category of cable
television operators and IPTV providers,
but at a lower regulatory fee rate. This
rule was adopted because the Media
Bureau staff spend approximately as
much time working on issues that
include DBS as cable television and
IPTV. For the most part, the rules and
policies addressed by the Media Bureau
include DBS and cable television, as
well as IPTV. Under section 9 of the
Commission’s rules, the DBS industry
should contribute to these regulatory
fees, otherwise the cable television and
IPTV industries are paying for costs that
should be shared with DBS.
B. Summary of the Significant Issues
Raised by the Public Comments in
Response to the IRFA
4. None.
C. Description and Estimate of the
Number of Small Entities to Which the
Rules Will Apply
5. 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.123 The RFA generally defines
the term ‘‘small entity’’ as having the
same meaning as the terms ‘‘small
business,’’ ‘‘small organization,’’ and
‘‘small governmental jurisdiction.’’ 124
In addition, the term ‘‘small business’’
PO 00000
122 5
U.S.C. 604.
U.S.C. 603(b)(3).
124 5 U.S.C. 601(6).
123 5
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has the same meaning as the term
‘‘small business concern’’ under the
Small Business Act.125 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.126 Nationwide,
there are a total of approximately 27.9
million small businesses, according to
the SBA.127
6. Wired Telecommunications
Carriers. The U.S. Census Bureau
defines this industry as ‘‘establishments
primarily engaged in operating and/or
providing access to transmission
facilities and infrastructure that they
own and/or lease for the transmission of
voice, data, text, sound, and video using
wired communications networks.
Transmission facilities may be based on
a single technology or a combination of
technologies. Establishments in this
industry use the wired
telecommunications network facilities
that they operate to provide a variety of
services, such as wired telephony
services, including VoIP services, wired
(cable) audio and video programming
distribution, and wired broadband
internet services. By exception,
establishments providing satellite
television distribution services using
facilities and infrastructure that they
operate are included in this
industry.’’ 128 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.129 Census
data for 2007 shows that there were
3,188 firms that operated that year. Of
this total, 3,144 operated with less than
1,000 employees.130 Thus, under this
size standard, the majority of firms in
this industry can be considered small.
7. Local Exchange Carriers (LECs).
Neither the Commission nor the SBA
has developed a size standard for small
125 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.’’
126 15 U.S.C. 632.
127 See SBA, Office of Advocacy, ‘‘Frequently
Asked Questions,’’ https://www.sba.gov/sites/
default/files/FAQ_Sept_2012.pdf.
128 https://www.census.gov/cgi-bin/sssd/naics/
naicsrch.
129 See 13 CFR 120.201, NAICS Code 517110.
130 https://factfinder.census.gov/faces/
tableservices/jsf/pages/
productview.xhtml?pid=ECN_2007_US_
51SSSZ5&prodType=table.
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businesses specifically applicable to
local exchange services. The closest
applicable NAICS Code category is
Wired Telecommunications Carriers as
defined in paragraph 6 of this FRFA.
Under the applicable SBA size standard,
such a business is small if it has 1,500
or fewer employees.131 According to
Commission data, census data for 2007
shows that there were 3,188 firms that
operated that year. Of this total, 3,144
operated with fewer than 1,000
employees.132 The Commission
therefore estimates that most providers
of local exchange carrier service are
small entities that may be affected by
the rules adopted.
8. Incumbent LECs. Neither the
Commission nor the SBA has developed
a small business size standard
specifically for incumbent local
exchange services. The closest
applicable NAICS Code category is
Wired Telecommunications Carriers as
defined in paragraph 6 of this FRFA.
Under that size standard, such a
business is small if it has 1,500 or fewer
employees.133 According to
Commission data, 3,188 firms operated
in that year. Of this total, 3,144 operated
with fewer than 1,000 employees.134
Consequently, the Commission
estimates that most providers of
incumbent local exchange service are
small businesses that may be affected by
the rules and policies adopted. Three
hundred and seven (307) Incumbent
Local Exchange Carriers reported that
they were incumbent local exchange
service providers.135 Of this total, an
estimated 1,006 have 1,500 or fewer
employees.136
9. Competitive Local Exchange
Carriers (Competitive LECs),
Competitive Access Providers (CAPs),
Shared-Tenant Service Providers, and
Other Local Service Providers. Neither
the Commission nor the SBA has
developed a small business size
standard specifically for these service
providers. The appropriate NAICS Code
category is Wired Telecommunications
Carriers, as defined in paragraph 6 of
this FRFA. Under that size standard,
131 13
137 13
CFR 121.201, NAICS code 517110.
132 https://factfinder.census.gov/faces/
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such a business is small if it has 1,500
or fewer employees.137 U.S. Census data
for 2007 indicate that 3,188 firms
operated during that year. Of that
number, 3,144 operated with fewer than
1,000 employees.138 Based on this data,
the Commission concludes that the
majority of Competitive LECS, CAPs,
Shared-Tenant Service Providers, and
Other Local Service Providers, are small
entities. According to Commission data,
1,442 carriers reported that they were
engaged in the provision of either
competitive local exchange services or
competitive access provider services.139
Of these 1,442 carriers, an estimated
1,256 have 1,500 or fewer employees.140
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.141 Also,
72 carriers have reported that they are
Other Local Service Providers.142 Of this
total, 70 have 1,500 or fewer
employees.143 Consequently, based on
internally researched FCC data, 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 the rules
adopted.
10. Interexchange Carriers (IXCs).
Neither the Commission nor the SBA
has developed a definition for
Interexchange Carriers. The closest
NAICS Code category is Wired
Telecommunications Carriers as defined
in paragraph 6 of this FRFA. The
applicable size standard under SBA
rules is that such a business is small if
it has 1,500 or fewer employees.144 U.S.
Census data for 2007 indicates that
3,188 firms operated during that year.
Of that number, 3,144 operated with
fewer than 1,000 employees.145
According to internally developed
Commission data, 359 companies
reported that their primary
telecommunications service activity was
the provision of interexchange
services.146 Of this total, an estimated
tableservices/jsf/pages/
productview.xhtml?pid=ECN_2007_US_
51SSSZ5&prodType=table.
133 13 CFR 121.201, NAICS code 517110.
134 https://factfinder.census.gov/faces/
tableservices/jsf/pages/
productview.xhtml?pid=ECN_2007_US_
51SSSZ5&prodType=table.
135 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).
136 Id.
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CFR 121.201, NAICS code 517110.
138 https://factfinder.census.gov/faces/
tableservices/jsf/pages/
productview.xhtml?pid=ECN_2007_US_
51SSSZ5&prodType=table.
139 See Trends in Telephone Service, at tbl. 5.3.
140 Id.
141 Id.
142 Id.
143 Id.
144 13 CFR 121.201, NAICS code 517110.
145 https://factfinder.census.gov/faces/
tableservices/jsf/pages/
productview.xhtml?pid=ECN_2007_US_
51SSSZ5&prodType=table.
146 See Trends in Telephone Service, at Table 5.3.
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317 have 1,500 or fewer employees.147
Consequently, the Commission
estimates that the majority of
interexchange service providers are
small entities that may be affected by
the rules adopted.
11. Prepaid Calling Card Providers.
Neither the Commission nor the SBA
has developed a small business size
standard specifically for prepaid calling
card providers. The appropriate NAICS
Code category for prepaid calling card
providers is Telecommunications
Resellers. This industry comprises
establishments engaged in purchasing
access and network capacity from
owners and operators of
telecommunications networks and
reselling wired and wireless
telecommunications services (except
satellite) to businesses and households.
Mobile virtual networks operators
(MVNOs) are included in this
industry.148 Under the applicable SBA
size standard, such a business is small
if it has 1,500 or fewer employees.149
U.S. 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.150 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.151 All 193 carriers
have 1,500 or fewer employees.152
Consequently, the Commission
estimates that the majority of prepaid
calling card providers are small entities
that may be affected by the rules
adopted.
12. 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.153 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.154 Under this category
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147 Id.
148 https://www.census.gov/cgi-bin/ssd/naics/
naicsrch.
149 13 CFR 121.201, NAICS code 517911.
150 https://factfinder.census.gov/faces/
tableservices/jsf/pages/
productview.xhtml?pid=ECN_2007_US_
51SSSZ5&prodType=table.
151 See Trends in Telephone Service, at Table 5.3.
152 Id.
153 13 CFR 121.201, NAICS code 517911.
154 https://factfinder.census.gov/faces/
tableservices/jsf/pages/
productview.xhtml?pid=ECN_2007_US_
51SSSZ5&prodType=table.
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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.155 Of this total, an estimated
211 have 1,500 or fewer employees.156
Consequently, the Commission
estimates that the majority of local
resellers are small entities that may be
affected by the rules adopted.
13. Toll Resellers. The Commission
has not developed a definition for Toll
Resellers. The closest NAICS Code
Category is Telecommunications
Resellers, and the SBA has developed a
small business size standard for the
category of Telecommunications
Resellers. Under that size standard, such
a business is small if it has 1,500 or
fewer employees.157 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.158 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.159 Of this total, an estimated
857 have 1,500 or fewer employees.160
Consequently, the Commission
estimates that the majority of toll
resellers are small entities that may be
affected by the rules adopted.
14. Other Toll Carriers. Neither the
Commission nor the SBA has developed
a definition for small businesses
specifically applicable to Other Toll
Carriers. This category includes toll
carriers that do not fall within the
categories of interexchange carriers,
operator service providers, prepaid
calling card providers, satellite service
carriers, or toll resellers. The closest
applicable NAICS Code category is for
Wired Telecommunications Carriers as
defined in paragraph 6 of this FRFA.
Under the applicable SBA size standard,
such a business is small if it has 1,500
or fewer employees.161 Census data for
2007 shows that there were 3,188 firms
that operated that year. Of this total,
3,144 operated with fewer than 1,000
155 See
Trends in Telephone Service, at tbl. 5.3.
156 Id.
157 https://factfinder.census.gov/faces/
tableservices/jsf/pages/
productview.xhtml?pid=ECN_2007_US_
51SSSZ5&prodType=table.
158 Id.
159 Trends in Telephone Service, at Table 5.3.
160 Id.
161 13 CFR 121.201, NAICS code 517110.
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employees.162 Thus, under this category
and the associated small business size
standard, the majority of Other Toll
Carriers can be considered small.
According to internally developed
Commission data, 284 companies
reported that their primary
telecommunications service activity was
the provision of other toll carriage.163 Of
these, an estimated 279 have 1,500 or
fewer employees.164 Consequently, the
Commission estimates that most Other
Toll Carriers are small entities that may
be affected by the rules and policies
adopted.
15. Wireless Telecommunications
Carriers (except Satellite). This industry
comprises establishments engaged in
operating and maintaining switching
and transmission facilities to provide
communications via the airwaves, such
as cellular services, paging services,
wireless internet access, and wireless
video services.165 The appropriate size
standard under SBA rules is that such
a business is small if it has 1,500 or
fewer employees. For this industry,
Census data for 2007 show that there
were 1,383 firms that operated for the
entire year. Of this total, 1,368 firms had
fewer than 1,000 employees. Thus
under this category and the associated
size standard, the Commission estimates
that the majority of wireless
telecommunications carriers (except
satellite) are small entities. Similarly,
according to internally developed
Commission data, 413 carriers reported
that they were engaged in the provision
of wireless telephony, including cellular
service, Personal Communications
Service (PCS), and Specialized Mobile
Radio (SMR) services.166 Of this total,
an estimated 261 have 1,500 or fewer
employees.167 Consequently, the
Commission estimates that
approximately half of these firms can be
considered small. Thus, using available
data, we estimate that the majority of
wireless firms can be considered small.
16. Cable Television and Other
Subscription Programming.168 Since
162 https://factfinder.census.gov/faces/
tableservices/jsf/pages/
productview.xhtml?pid=ECN_2007_US_
51SSSZ5&prodType=table.
163 Trends in Telephone Service, at Table 5.3.
164 Id.
165 NAICS Code 517210. See https://
www.census.gov/cgi-bin/ssd/naics/naiscsrch.
166 Trends in Telephone Service, at Table 5.3.
167 Id.
168 In 2014, ‘‘Cable and Other Subscription
Programming,’’ NAICS Code 515210, replaced a
prior category, now obsolete, which was called
‘‘Cable and Other Program Distribution.’’ Cable and
Other Program Distribution, prior to 2014, was
placed under NAICS Code 517110, Wired
Telecommunications Carriers. Wired
Telecommunications Carriers is still a current and
valid NAICS Code Category. Because of the
PO 00000
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Fmt 4700
Sfmt 4700
43029
2007, these services have been defined
within the broad economic census
category of Wired Telecommunications
Carriers. That 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.’’ 169 The SBA has
developed a small business size
standard for this category, which is: all
such firms having 1,500 or fewer
employees.170 Census data for 2007
shows that there were 3,188 firms that
operated that year. Of this total, 3,144
had fewer than 1,000 employees.171
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.
17. Cable Companies and Systems.
The Commission has developed its own
small business size standards, for the
similarity between ‘‘Cable and Other Subscription
Programming’’ and ‘‘Cable and other Program
Distribution,’’ we will, in this proceeding, continue
to use Wired Telecommunications Carrier data
based on the U.S. Census. The alternative of using
data gathered under Cable and Other Subscription
Programming (NAICS Code 515210) is unavailable
to us for two reasons. First, the size standard
established by the SBA for Cable and Other
Subscription Programming is annual receipts of
$38.5 million or less. Thus to use the annual
receipts size standard would require the
Commission either to switch from existing
employee based size standard of 1,500 employees
or less for Wired Telecommunications Carriers, or
else would require the use of two size standards.
No official approval of either option has been
granted by the Commission as of the time of the
release of this Regulatory Fees NPRM and its
associated Report and Order and Order. Second, the
data available under the size standard of $38.5
million dollars or less is not applicable at this time,
because the only currently available U.S. Census
data for annual receipts of all businesses operating
in the NAICS Code category of 515210 (Cable and
other Subscription Programming) consists only of
total receipts for all businesses operating in this
category in 2007 and of total annual receipts for all
businesses operating in this category in 2012. The
data do not provide any basis for determining, for
either year, how many businesses were small
because they had annual receipts of $38.5 million
or less. See https://factfinder.census.gov/faces/
tableservices/jsf/pages/
productview.xhtml?pid=ECN_2012_US_
51I2&prodType=table.
169 U.S. Census Bureau, 2007 NAICS Definitions,
‘‘517110 Wired Telecommunications Carriers’’
(partial definition), (Full definition stated in
paragraph 6 of this IRFA) available at https://
www.census.gov/cgi-bin/sssd/naics/naicsrch.
170 13 CFR 121.201, NAICS code 517110.
171 https://factfinder.census.gov/faces/
tableservices/jsf/pages/
productview.xhtml?pid=ECN_2007_US51SSSZ5&prodType=Table.
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Federal Register / Vol. 80, No. 139 / Tuesday, July 21, 2015 / Rules and Regulations
purpose of cable rate regulation. Under
the Commission’s rules, a ‘‘small cable
company’’ is one serving 400,000 or
fewer subscribers, nationwide.172
Industry data indicate that at the end of
June 2012, 1,141 cable companies were
in operation.173 Of this total, all but ten
cable operators were small under this
size standard. In addition, under the
Commission’s rules, a ‘‘small system’’ is
a cable system serving 15,000 or fewer
subscribers.174 Industry data indicate
that of 4,945 systems nationwide, 4,380
systems have fewer than 20,000.175
Thus, under this second size standard,
most cable systems are small and may
be affected by the rules adopted.
18. All Other Telecommunications.
‘‘All Other Telecommunications’’ is
defined as follows: This U.S. industry is
comprised of establishments that are
primarily engaged in providing
specialized telecommunications
services, such as satellite tracking,
communications telemetry, and radar
station operation. This industry also
includes establishments primarily
engaged in providing satellite terminal
stations and associated facilities
connected with one or more terrestrial
systems and capable of transmitting
telecommunications to, and receiving
telecommunications from, satellite
systems. Establishments providing
Internet services or voice over Internet
protocol (VoIP) services via clientsupplied telecommunications
connections are also included in this
industry.176 The SBA has developed a
small business size standard for ‘‘All
Other Telecommunications,’’ which
consists of all such firms with gross
annual receipts of $32.5 million or
less.177 For this category, census data for
2007 show that there were 2,383 firms
that operated for the entire year. Of
these firms, a total of 2,346 had gross
annual receipts of less than $25
million.178 Thus, a majority of ‘‘All
asabaliauskas on DSK5VPTVN1PROD with RULES
172 See
47 CFR 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, 60
FR 35854, 35855, para. 7 (July 12, 1995).
173 NCTA, Industry Data, Number of Cable
Operating Companies. See https://www.ncta.com/
Statistics.aspx.
174 See 47 CFR 76.901(c).
175 The number of active, registered cable systems
comes from the Commission’s Cable Operations
Licensing System (COALS) database on August 28,
2013.
176 https://www.census.gov/cgi-bin/ssssd/naics/
naicsrch.
177 13 CFR 121.201; NAICS Code 517919.
178 https://factfinder.census.gov/faces/
tableservices/jsf/pages/
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Other Telecommunications’’ firms
potentially affected by the rules adopted
can be considered small.
D. Description of Projected Reporting,
Recordkeeping and Other Compliance
Requirements
19. This Report and Order does not
adopt any new reporting, recordkeeping,
or other compliance requirements, other
than the requirement that DBS providers
pay regulatory fees based on Media
Bureau FTEs, as a subcategory of the
cable television operators and IPTV
category. These two companies are
already subject to our regulatory fee
requirements.
E. Steps Taken To Minimize Significant
Economic Impact on Small Entities, and
Significant Alternatives Considered
20. 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.179
21. This Report and Order does not
adopt any new reporting requirements.
Therefore no adverse economic impact
on small entities will be sustained based
on reporting requirements. There will be
a regulatory fee increase on DBS
providers, but these companies are not
small entities. We are also advising
SMS/800, Inc. to provide information to
Responsible Organizations, or RespOrgs,
to ensure that they comply with their
new previously adopted regulatory fee
requirements. These entities may be
small entities; however, the regulatory
fee per toll free number is very small
and could easily be paid and then
passed on to the subscriber if the
number is in use, in which case
compliance would not be an issue. (We
also note that there is a previously
adopted de minimis threshold of $500,
per year.) If the toll free number is not
used by a subscriber, the RespOrg can
either choose to pay the regulatory fee
or return the toll free number to the 800/
SMS, Inc. database. The Commission
expends resources to address toll free
productview.xhtml?pid=ECN_2007_US_
51SSSZ5&prodType=table.
179 5 U.S.C. 603(c)(1)–(c)(4).
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Frm 00024
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issues, and so parties should either be
responsible for the payment of the
resources used or the toll free numbers
should be returned for others to use.
22. 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. In addition, the Commission’s
rules provide a process by which
regulatory fee payors may seek waivers
or other relief on the basis of financial
hardship. See 47 CFR 1.1166.
F. Federal Rules That May Duplicate,
Overlap, or Conflict
23. None.
V. Ordering Clauses
24. 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 Report and
Order and Order is hereby adopted.
25. It is further ordered that Part 1 of
the Commission’s rules are amended as
set forth in paragraph 32 and in the rule
change section of this document,
effective upon publication in the
Federal Register.
26. It is further ordered that the
Commission’s Consumer and
Governmental Affairs Bureau, Reference
Information Center, shall send a copy of
this Report and Order and Order,
including the Final Regulatory
Flexibility Analysis, to the Chief
Counsel for Advocacy of the U.S. Small
Business Administration.
List of Subjects in 47 CFR Part 1
Administrative practice and
procedure.
Federal Communications Commission.
Marlene H. Dortch,
Secretary.
Rule Changes
For the reasons discussed in the
preamble, the Federal Communications
Commission amends 47 CFR part 1 as
follows:
PART 1—PRACTICE AND
PROCEDURE
1. The authority citation for part 1
continues to read as follows:
■
Authority: 15 U.S.C. 79 et seq., 47 U.S.C.
151, 154(i), 154(j), 155, 157, 225, 303, and
309.
Subpart O—Collection of Claims Owed
the United States
2. Revise § 1.1911(d) to read as
follows:
■
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Federal Register / Vol. 80, No. 139 / Tuesday, July 21, 2015 / Rules and Regulations
§ 1.1911
Demand for payment.
*
*
*
*
*
(d) The Commission may, as
circumstances and the nature of the debt
permit, include in demand letters such
items as the Commission’s willingness
to discuss alternative methods of
payment; its policies with respect to the
use of credit bureaus, debt collection
centers, and collection agencies; the
Commission’s remedies to enforce
payment of the debt (including
assessment of interest, administrative
costs and penalties, administrative
garnishment, the use of collection
agencies, Federal salary offset, tax
refund offset, administrative offset, and
litigation); the requirement that any debt
delinquent for more than 120 days be
transferred to the Department of the
Treasury for collection; and, depending
on applicable statutory authority, the
debtor’s entitlement to consideration of
a waiver. Where applicable, the debtor
will be provided with a period of time
(normally not more than 15 calendar
days) from the date of the demand in
which to exercise the opportunity to
request a review.
*
*
*
*
*
■ 3. Revise § 1.1912(b)(1) to read as
follows:
§ 1.1912
offset.
Collection by administrative
*
*
*
*
*
(b) Mandatory centralized
administrative offset. (1) The
Commission is required to refer past
due, legally enforceable nontax debts
which are over 120 days delinquent to
the Treasury for collection by
centralized administrative offset. Debts
which are less than 120 days delinquent
also may be referred to the Treasury for
this purpose. See FCCS for debt
certification requirements.
*
*
*
*
*
■ 4. Revise § 1.1917(c) to read as
follows:
§ 1.1917 Referrals to the Department of
Justice and transfer of delinquent debt to
the Secretary of Treasury.
asabaliauskas on DSK5VPTVN1PROD with RULES
*
*
*
*
*
(c) All non-tax debts of claims owed
to the Commission that have been
delinquent for a period of 120 days shall
be transferred to the Secretary of the
Treasury. Debts which are less than 120
days delinquent may also be referred to
the Treasury. Upon such transfer the
Secretary of the Treasury shall take
appropriate action to collect or
terminate collection actions on the debt
or claim. A debt is past-due if it has not
been paid by the date specified in the
Commission’s initial written demand for
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payment or applicable agreement or
instrument (including a postdelinquency payment agreement) unless
other satisfactory payment arrangements
have been made.
[FR Doc. 2015–17288 Filed 7–20–15; 8:45 am]
BILLING CODE 6712–01–P
NATIONAL AERONAUTICS AND
SPACE ADMINISTRATION
48 CFR Parts 1837 and 1852
43031
removed in error and need to be
restored. NASA is not altering these
policies and regulations, but rather,
correcting an inadvertent deletion. This
document corrects the final rule by
revising these sections.
List of Subject in 48 CFR Parts 1837 and
1852
Government procurement.
Cynthia Boots,
Alternate Federal Register Liaison.
RIN 2700–AE01 and 2700–AE09
Accordingly, 48 CFR parts 1837 and
1852 are amended as follows:
NASA Federal Acquisition Regulation
Supplement; Correction
PART 1837—SERVICE CONTRACTING
National Aeronautics and
Space Administration.
ACTION: Correcting amendments.
AGENCY:
The National Aeronautics and
Space Administration (NASA)
published a final rule in the Federal
Register on Thursday, March 12, 2015
(80 FR 12935), as part of the NASA
Federal Acquisition Regulation
Supplement (NFS) regulatory review.
That document (80 FR 12835)
inadvertently removed sections of the
NFS that relate to access and release of
sensitive information in the
performance of advisory and assistance
services in NFS parts 1837 and 1852.
This document corrects the final rule by
reinstating these original sections of the
regulation.
DATES: Effective: July 21, 2015.
FOR FURTHER INFORMATION CONTACT:
Marilyn J. Seppi, NASA, Office of
Procurement, Contract and Grant Policy
Division, via email at marilyn.j.seppi-1@
nasa.gov, or telephone (202) 358–0447.
SUPPLEMENTARY INFORMATION:
SUMMARY:
1. The authority citation for part 1837
is revised to read as follows:
■
Authority: 51 U.S.C. 20113(a) and 48 CFR
chapter 1.
2. Revise subpart 1837.2 to read as
follows:
■
Subpart 1837.2—Advisory and Assistance
Services
Sec.
1837.203 Policy.
1837.203–70 Providing contractors access
to sensitive information.
1837.303–71 Release of contractors’
sensitive information.
1837.203–72 NASA contract clauses.
Subpart 1837.2—Advisory and
Assistance Services
1837.203
Policy.
(c) Advisory and assistance services of
individual experts and consultants shall
normally be obtained by appointment
rather than by contract (see NPR 3300.1,
Appointment of Personnel To/From
NASA, Chapter 4, Employment of
Experts and Consultants).
I. Background
1837.203–70 Providing contractors access
to sensitive information.
NASA published a final rule in the
Federal Register on March 12, 2015,
inadvertently removing from the Code
of Federal Regulations (CFR) those
sections of the NASA FAR Supplement
that contained information related to
access and release of sensitive
information while performing
contracted advisory and assistance
contracts. As published, the rule
contains errors due to inadvertent
deletion of text that needs to be
corrected. Specifically, in amendatory
instruction 49 on page 12944 of that
final rule, NFS sections 1837.203–70,
1837.203–71, and 1837.203–72 were
erroneously deleted and need to be
restored. In addition, in amendatory
instruction 94 on page 12953 of the final
rule, the associated clauses at NFS
1852.237–72 and 1852.237–73 were also
(a)(1) As used in this subpart,
‘‘sensitive information’’ refers to
information that the contractor has
developed at private expense or that the
Government has generated that qualifies
for an exception to the Freedom of
Information Act, which is not currently
in the public domain, may embody
trade secrets or commercial or financial
information, and may be sensitive or
privileged, the disclosure of which is
likely to have either of the following
effects: To impair the Government’s
ability to obtain this type of information
in the future; or to cause substantial
harm to the competitive position of the
person from whom the information was
obtained. The term is not intended to
resemble the markings of national
security documents as in sensitivesecret-top secret.
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]]>Agencies
[Federal Register Volume 80, Number 139 (Tuesday, July 21, 2015)]
[Rules and Regulations]
[Pages 43019-43031]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-17288]
=======================================================================
-----------------------------------------------------------------------
FEDERAL COMMUNICATIONS COMMISSION
47 CFR Part 1
[MD Docket Nos. 14-92; 15-121; 15-121; FCC 15-59]
Assessment and Collection of Regulatory Fees for Fiscal Year 2015
AGENCY: Federal Communications Commission.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: In this document, the Federal Communications Commission
(Commission) eliminates the regulatory fee components of two fee
categories, the amateur radio Vanity Call Sign and the General Mobile
Radio Service (GMRS); establishes a new Direct Broadcast Satellite
(DBS) regulatory fee category; provides specific instructions for
RespOrgs (Responsible Organizations), holders of toll free numbers that
are subject to regulatory fees, and amends rule provisions to specify
that debts owed to the Commission that have been delinquent for a
period of 120 days shall be transferred to the Secretary of the
Treasury.
DATES: Effective July 21, 2015.
FOR FURTHER INFORMATION CONTACT: Roland Helvajian, Office of Managing
Director at (202) 418-0444.
SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Report
and Order, FCC 15-59, MD Docket No. 15-121, adopted on May 20, 2015 and
released May 21, 2015.
I. Procedural Matters
Final Regulatory Flexibility Analysis
1. As required by the Regulatory Flexibility Act of 1980 (RFA),\1\
the Commission has prepared a Final Regulatory Flexibility Analysis
(FRFA) relating to this Report and Order.
---------------------------------------------------------------------------
\1\ See 5 U.S.C. 603. The RFA, see 5 U.S.C. 601-612, has been
amended by the Small Business Regulatory Enforcement Fairness Act of
1996 (SBREFA), Public Law 104-121, Title II, 110 Stat. 847 (1996).
The SBREFA was enacted as Title II of the Contract with America
Advancement Act of 1996 (CWAAA).
---------------------------------------------------------------------------
Congressional Review Act
2. The Commission will send a copy of this Report and Order and
Order to Congress and the Government Accountability Office pursuant to
the Congressional Review Act. 5 U.S.C. 801(a)(1)(A).
Final Paperwork Reduction Act of 1995 Analysis
3. This Report and Order 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).
4. Finally, in the Order section of this document, we amend three
sections of our rules \2\ to conform to the Digital Accountability and
Transparency Act (DATA Act) concerning when claims should be
transferred to the Secretary of the Treasury.\3\ In particular, we make
the ministerial change to our rules to specify that debts owed to the
Commission that have been delinquent for a period of 120 days shall be
transferred to the Secretary of the Treasury. The rules previously
specified transfer of delinquent debt to the Treasury after 180 days.
---------------------------------------------------------------------------
\2\ 47 CFR 1.1911(d), 1.1912(b)(1), 1.1917(c).
\3\ 31 U.S.C. 3716(c)(6).
---------------------------------------------------------------------------
II. Introduction
5. In the Report and Order, the Commission adopted a proposal from
[[Page 43020]]
our FY 2014 Further Notice of Proposed Rulemaking to add a new
subcategory in the existing cable television and Internet Protocol TV
(IPTV) regulatory fee category for direct broadcast satellite (DBS)
providers.\4\ In addition, we provide specific instructions regarding
our new regulatory fee requirement for toll free numbers.\5\ We also
remove amateur radio Vanity Call Signs and General Mobile Radio Service
(GMRS) from the regulatory fee schedule.\6\ The addition of DBS to the
cable television and IPTV category and removal of two wireless
categories from the schedule are permitted amendments to the regulatory
fee schedule and require Congressional notification.\7\
---------------------------------------------------------------------------
\4\ Assessment and Collection of Regulatory Fees for Fiscal Year
2014, Report and Order and Further Notice of Proposed Rulemaking, MD
Docket No. 14-92, 79 FR 63883, 63885-63886, paras. 10-15 (October
27, 2014).
\5\ In 2014, the Commission adopted a regulatory fee requirement
for toll free numbers. See FY 2014 Report and Order, 79 FR 54190,
54195-54196, paras. 28-31 (September 11, 2014).
\6\ We sought comment on eliminating these categories in our FY
2014 NPRM. Assessment and Collection of Regulatory Fees for Fiscal
Year 2014, Notice of Proposed Rulemaking, Second Further Notice of
Proposed Rulemaking, and Order, MD Docket No. 14-92, 79 FR 37982,
37989, para. 38 (July 3, 2014).
\7\ 47 U.S.C. 159(b)(3)-(4)(requiring Congressional notification
of permitted amendments not later than 90 days before the effective
date of such amendment).
---------------------------------------------------------------------------
III. Background
6. The Commission is required by Congress to assess regulatory fees
each year in an amount that can reasonably be expected to equal the
amount of its appropriation.\8\ Regulatory 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. . .
.'' \9\ 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.\10\ Regulatory fees also
cover the costs incurred in regulating entities that are statutorily
exempt from paying regulatory fees,\11\ entities whose regulatory fees
are waived,\12\ and entities that provide nonregulated services.
Congress sets the amount the Commission must collect each year in the
Commission's fiscal year appropriations, and section 9(a)(2) of the
Communications Act of 1934, as amended (Communications Act or Act)
requires the Commission to collect fees sufficient to offset the amount
appropriated.\13\ 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 full time
employees (FTEs) \14\ in each regulatory fee category. Historically,
the Commission has classified FTEs as ``direct'' if the employee is in
one of the four ``core'' bureaus; otherwise, that employee was
considered an ``indirect'' FTE.\15\ The total FTEs for each fee
category includes the direct FTEs associated with that category, plus a
proportional allocation of the indirect FTEs.
---------------------------------------------------------------------------
\8\ 47 U.S.C. 159(b)(1)(B).
\9\ 47 U.S.C. 159(b)(1)(A).
\10\ See Assessment and Collection of Regulatory Fees for Fiscal
Year 2004, Report and Order, 69 FR 41028, 4103, para. 11 (July 7,
2004).
\11\ 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 CFR 1.1162.
\12\ 47 CFR 1.1166.
\13\ 47 U.S.C. 159(a)(2).
\14\ 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.
\15\ The core bureaus are the Wireline Competition Bureau (172
FTEs), Wireless Telecommunications Bureau (91 FTEs), Media Bureau
(155 FTEs), and part of the International Bureau (28 FTEs), totaling
446 ``direct'' FTEs. 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 the Managing
Director, Office of General Counsel, Office of the Inspector
General, Office of Communications Business Opportunities, Office of
Engineering and Technology, Office of Legislative Affairs, Office of
Strategic Planning and Policy Analysis, Office of Workplace
Diversity, Office of Media Relations, and Office of Administrative
Law Judges, totaling 1,037 ``indirect'' FTEs. These totals are as of
Oct. 1, 2014 and exclude auctions FTEs.
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7. Section 9 of the Communications Act requires the Commission to
make certain changes (i.e., mandatory amendments) to the regulatory fee
schedule if it ``determines that the Schedule requires amendment to
comply with the requirements'' of section 9(b)(1)(A).\16\ In addition,
the Commission must add, delete, or reclassify services in the fee
schedule to reflect additions, deletions, or changes in the nature of
its services ``as a consequence of Commission rulemaking proceedings or
changes in law.'' \17\ These ``permitted amendments'' require
Congressional notification.\18\ The changes in fees resulting from both
mandatory and permitted amendments are not subject to judicial
review.\19\
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\16\ 47 U.S.C. 159(b)(3).
\17\ 47 U.S.C. 159(b)(3).
\18\ 47 U.S.C. 159(b)(4)(B).
\19\ 47 U.S.C. 159(b)(3). But see Comsat Corp. v. FCC, 114 F.3d
223, 227 (D.C. Cir. 1997) (``Where, as here, we find that the
Commission has acted outside the scope of its statutory mandate, we
also find that we have jurisdiction to review the Commission's
action.'')
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8. The Commission continues to improve the regulatory fee process
by ensuring 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. For example, in 2013, the
Commission updated the FTE allocations to more accurately align
regulatory fees with the costs of Commission oversight and
regulation,\20\ as recommended in the GAO Report, a report issued by
the Government Accountability Office (GAO) in 2012.\21\ The Commission
also reallocated some FTEs from the International Bureau as
``indirect.'' \22\ Subsequently, in the FY 2014 Report and Order, the
Commission adopted the new toll free number regulatory fee category
\23\ and, in the accompanying FY 2014 Further Notice of Proposed
Rulemaking, the Commission sought additional comment on a new
regulatory fee category for DBS.\24\ In this Report and Order, we now
add a subcategory for DBS providers in the cable television and IPTV
regulatory fee category based on our finding that Media Bureau FTEs
work on issues and proceedings that include DBS as well as other
multichannel video programming distributors (MVPDs).
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\20\ Assessment and Collection of Regulatory Fees for Fiscal
Year 2013, Report and Order, MD Docket No. 13-140, 78 FR 52433,
52436-52437, paras. 10-15 (August 23, 2013).
\21\ In 2012, the GAO concluded that the Commission should
conduct an overall analysis of the regulatory fee categories and
perform an updated FTE analysis by fee category. GAO ``Federal
Communications Commission Regulatory Fee Process Needs to be
Updated,'' GAO-12-686 (Aug. 2012) (GAO Report) at 36, (available at
https://www.gao.gov/products/GAO-12-686).
\22\ FY 2013 Report and Order, 78 FR 52433, 52436-52438, paras.
12-21 (August 23, 2013).
\23\ FY 2014 Report and Order, 79 FR 54190, 54195-54196, paras.
28-31 (September 11, 2014).
\24\ FY 2014 Further Notice of Proposed Rulemaking, 79 FR 63883,
63885-63886, paras. 10-15 (October 27, 2014).
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IV. Discussion
A. Report and Order
1. Eliminating Regulatory Fee Categories
9. In the FY 2014 NPRM,\25\ we sought comment on eliminating
several of the smaller regulatory fee categories such as amateur radio
Vanity Call Signs \26\ and
[[Page 43021]]
GMRS.\27\ In the FY 2014 Report and Order, we concluded that we did not
yet have adequate support to determine whether the cost of recovery and
burden on small entities outweighed the collected revenue or whether
eliminating the fee would adversely affect the licensing process.\28\
We stated, however, that we would reevaluate this issue in the future.
Since adoption of the FY 2014 Report and Order, Commission staff have
had an opportunity to obtain and analyze support concerning the
collection of fees from these regulatees.
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\25\ FY 2014 NPRM, 79 FR 37982, 37989, para. 38 (July 3, 2014).
\26\ Call signs assigned to newly licensed stations, i.e., a
sequential call sign, are assigned based on the licensee's mailing
address and class of operator license. 47 CFR 97.17(d). The licensee
can request a specific unassigned but assignable call sign, known as
a vanity call sign. 47 CFR 97.19. There is no fee for the sequential
call sign.
\27\ GMRS (formerly Class A of the Citizens Radio Service) is a
personal radio service available for the conduct of an individual's
personal and family communications. See 47 CFR 95.1. We initially
proposed eliminating regulatory fees for GMRS in the FY 2008 Report
and Order and Further Notice. See Assessment and Collection of
Regulatory Fees for Fiscal Year 2008, Report and Order and Further
Notice of Proposed Rulemaking, 73 FR 50285, 50290-50291, para 33
(August 26, 2008) (FY 2008 Report and Order and Further Notice). The
Commission has an open proceeding to review the Part 95, Personal
Radio Service rules, which include GMRS. See Review of the
Commission's Part 95 Personal Radio Services Rules, WT Docket No.
10-119, Notice of Proposed Rulemaking and Memorandum Opinion and
Order on Reconsideration, 75 FR 47142, 47143-47144, para. 4 (August
4, 2010).
\28\ FY 2014 Report and Order, 79 FR 54190, 54195, para. 26
(September 11, 2014).
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10. The GMRS and amateur radio Vanity Call Sign regulatory fee
categories comprise on average over 20,000 licenses that are newly
obtained or renewed every five and 10 years, respectively. After five
years, the GMRS licensee is responsible for renewing the license (or
cancelling) and the Commission is responsible for maintaining accurate
records of licenses coming up for renewal--an administrative burden on
both GMRS users and on the Commission for renewing and maintaining
records of these licenses. After analyzing the costs of processing fee
payments for GMRS, we conclude that the Commission's cost of collecting
and processing this fee exceeds the payment amount of $25. Our costs
have increased over time and now that the costs exceed the amount of
the regulatory fee, the increased relative administrative cost supports
eliminating this regulatory fee category.
11. The Vanity Call Sign fee category has a small regulatory fee
($21.40 in FY 2014) for a 10-year license. The Commission often
receives multiple applications for the same vanity call sign, but only
one applicant can be issued that call sign. In such cases, the
Commission issues refunds for all the remaining applicants. In addition
to staff and computer time to process payments and issue refunds, there
is an additional expense to issue checks for the applicants who cannot
be refunded electronically. The Commission spends more resources on
processing the regulatory fees and issuing refunds than the amount of
the regulatory fee payment. As our costs now exceed the regulatory fee,
we are eliminating this regulatory fee category.
12. The Commission will therefore eliminate the GMRS and Vanity
Call Sign regulatory fee categories after the required congressional
notification is provided.\29\ Once eliminated, these licensees will no
longer be financially burdened with such payments and the Commission
will no longer incur these administrative costs that exceed the fee
payments. The revenue that the Commission would otherwise collect from
these regulatory fee categories will be proportionally assessed on
other wireless fee categories. This is a ``permitted amendment'' as
defined in section 9(b)(3) of the Act, which, pursuant to section
9(b)(4)(B, must be submitted to Congress at least 90 days before it
becomes effective.\30\
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\29\ After the 90-day notification period for a permitted
amendment, these two fee categories will be eliminated. We will not
be issuing refunds to licensees who have paid the regulatory fee
prior to the elimination of the fee.
\30\ 47 U.S.C. 159(b)(3).
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2. Toll Free Numbers
13. Toll free numbers, defined in section 52.101(f) of our
rules,\31\ allow callers to reach the called party without being
charged for the call. Instead, the charge for the call is paid by the
called party (the toll free subscriber).\32\ Prior to the FY 2014
Report and Order, the Commission did not assess regulatory fees on toll
free numbers based on the assumption that the entities controlling the
numbers--wireline and wireless common carriers--were paying regulatory
fees based on either revenues or subscribers.\33\ In the FY 2014 NPRM,
we observed this was no longer the case because many toll free numbers
are now controlled or managed by RespOrgs \34\ that are not common
carriers.\35\ In the FY 2014 Report and Order, we adopted a regulatory
fee obligation for toll free numbers beginning in FY 2015, finding that
the Commission has both the legal authority and responsibility to
assess regulatory fees on toll free numbers.\36\ This regulatory fee
assessed on RespOrgs for toll free numbers managed by a RespOrg,\37\ is
payable for all toll free numbers unless calls from only other
countries can be completed using those toll free numbers.\38\ This
regulatory fee is assessed on RespOrgs for each working, assigned,
reserved, in transit, or any other status of toll free number as
defined in section 52.103 of the Commission's rules. Interstate
Telecommunications Service Providers (ITSPs) that are RespOrgs and
RespOrgs that are not ITSPs will be responsible for this regulatory
fee.
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\31\ Toll free numbers are telephone numbers for which the toll
charges for completed calls are paid by the toll free subscriber.
See 47 CFR 52.101(f). These are 800, 888, 877, 866, 855, and 844
numbers. SMS/800 (or the 800 Service Management System) is a
centralized system that performs toll free number management. For a
list of RespOrgs on the SMS/800, Inc. Web site, see https://www.sms800.com/Controls/NAC/Serviceprovider.aspx.
\32\ 47 U.S.C. 52.101 (e), (f).
\33\ FY 2014 Report and Order, 79 FR 54190, 54195, para. 28,
Footnote 76 (citing Universal Service Contribution Methodology,
Further Notice of Proposed Rulemaking, 77 FR 33896, 33923, para. 227
(June 7, 2012).
\34\ A RespOrg is a company that manages toll free telephone
numbers for subscribers. RespOrgs use the SMS/800 data base to
verify the availability of specific numbers and to reserve the
numbers for subscribers. See 47 CFR 52.101(b).
\35\ FY 2014 NPRM, 79 FR 37982, 37992, para. 57, Footnote 91
(citing, inter alia, Telseven, LLC, Calling 10, LLC, Patrick Hines
a/k/a P. Brian Hines, Notice of Apparent Liability for Forfeiture,
27 FCC Rcd 15558, 15560, para. 3 (2012) (various corporations,
including non-common carrier RespOrgs, owned and controlled by
Patrick Hines, controlled approximately one million toll free
numbers for Hines' ``directory assistance'' operation.))
\36\ FY 2014 Report and Order, 79 FR 54190, 54195, para. 28-29
(September 11, 2014) (summarizing the legal rationale for adoption
of a fee on toll free numbers and the FTEs involved in toll free
issues) (citing Toll Free Access Codes, Second Report and Order and
Further Notice of Proposed Rulemaking, CC Docket No. 95-155, 62 FR
20126, 20127 (April 25, 1997) (Toll Free Second Report and Order)
(Sections 201(b) and 251(e) of the Act ``empower the Commission to
ensure that toll free numbers . . . are allocated in an equitable
and orderly manner that serves the public interest.'')).
\37\ The proposed fee rate for toll free numbers for FY 2015 is
in Table C (FY 2015 Notice of Proposed Rulemaking).
\38\ See FY 2014 Report and Order, 79 FR 54190, 54195-54196,
para. 30 (September 11, 2014).
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14. The decision in 2014 to expand the pool of regulatory fee
obligations to all RespOrgs created a system in which there are now
numerous entities that play a role in toll free number administration
and are required to pay annual regulatory fees but are not common
carriers and therefore may lack familiarity with the Commission's
rules. In the FY 2014 Report and Order, we did not adopt a specific
enforcement mechanism to address circumstances where RespOrgs do not
make regulatory fee payments but instead, sought further comment on the
additional procedures
[[Page 43022]]
for enforcement in such instances.\39\ Instead of adopting additional
enforcement procedures at this time, however, we direct SMS/800,
Inc.\40\ to provide the necessary outreach to the RespOrgs, through its
tariff, Web site, or otherwise, to advise them that: ``The Federal
Communications Commission (FCC) has adopted a regulatory fee category
for toll free numbers, assessed for each toll free number managed by a
Responsible Organization (RespOrg). This regulatory fee, assessed on
RespOrgs for toll free numbers managed by a RespOrg, is payable for all
toll free numbers unless calls from only other countries can be
completed using those toll free numbers. A RespOrg that fails to pay
the regulatory fee assessed by the FCC will be subject to penalties.''
\41\
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\39\ FY 2014 Report and Order, 79 FR 63883, 63885, paras. 8-9
(October 27, 2014).
\40\ SMS/800, Inc. provides administration and routing for all
toll free numbers in North America. The Commission has the ultimate
authority over numbering resources and oversees the SMS Tariff and
SMS/800 Board. See 47 U.S.C. 251 (e)(1); see generally Toll Free
Service Access Codes, CC Docket No. 95-155; Petition to Change the
Composition of SMS/800, Inc., WC Docket No. 12-260, 28 FCC Rcd 15328
(2013) (SMS Reauthorization Order). Previously the Commission
required SMS/800, Inc. to include language prohibiting toll free
number hoarding and warehousing in the SMS Tariff. See Toll Free
Service Access Codes, Second Report and Order and Further Notice of
Proposed Rulemaking, 62 FR 20126, 20127, para. 1 (April 25, 1997).
\41\ See Toll Free Second Report and Order, 62 FR 20126 (April
25, 1997) (``We also may limit any RespOrg's allocation of toll free
numbers or possibly decertify it as a RespOrg under section
251(e)(1) or section 4(i) [of the Communications Act].'')
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15. The imposition of a regulatory fee on RespOrgs is a new rule,
adopted in the FY 2014 Report and Order, and non-common carriers may be
unfamiliar with our regulatory fee process and unaware that
delinquencies can result in penalties imposed by SMS/800, Inc.,
penalties imposed by the Commission pursuant to the Debt Collection
Improvement Act of 1996 (DCIA), and/or enforcement action by the
Enforcement Bureau, pursuant to delegated authority, or by the
Commission.\42\ As a result, OMD will coordinate with SMS/800, Inc. to
ensure that all RespOrgs owing regulatory fees have sufficient
information about this process and opportunity to pay the regulatory
fee before the RespOrg is placed in red light status and enforcement
procedures are initiated.\43\
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\42\ The Commission has a number of generally applicable
mechanisms to ensure collection of delinquent debt which would also
apply to RespOrgs. See generally FY 2014 Report and Order, 79 FR
54190, 54199, paras. 47-48 (September 11, 2014) (summarizing the
late payment penalty on unpaid regulatory fees under 47 U.S.C.
159(c), the red-light rule set forth in section 1.1910 of the
Commission's rules, 47 CFR 1.1910, and additional provisions
contained in the Debt Collection Improvement Act of 1996 (DCIA), 31
U.S.C. 3701 et seq., See Amendment of Parts 0 and 1 of the
Commission's Rules, MD Docket No. 02-339, Report and Order, 69 FR
27843 (May 17, 2004); 47 CFR part 1, subpart O, Collection of Claims
Owed the United States).
\43\ Hypercube Telecom contends that the consumer end-users
would be affected by our enforcement action against a RespOrg.
Hypercube Telecom Reply Comments at 3-5. The notifications that are
part of our delinquent bill collection process will give RespOrgs
multiple opportunities to pay any delinquency before enforcement
action.
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16. The basis for identifying the toll free number count upon which
a regulatory fee will be assessed for each RespOrg will be derived from
data provided by SMS/800, Inc.\44\ The toll free number data will be
determined by the toll free number count as of or around December 31st
of each year. In addition to maintaining contact information with SMS/
800, Inc., RespOrgs are also responsible for: (i) Obtaining an FRN (FCC
Registration Number); \45\ (ii) maintaining current contact information
in the Commission Registration System (CORES); \46\ (iii) reviewing the
Commission's Regulatory Fees Home Page for updates on regulatory fees;
\47\ and (iv) making timely regulatory fee payments using the
Commission's Electronic Filing and Payment System (Fee Filer) located
at: www.fcc.gov/feefiler. SMS/800, Inc. will provide the Commission
with up-to-date contact information for the RespOrgs as needed to
facilitate the timely payment of regulatory fees for toll free numbers.
Under our bill collection procedures, delinquent RespOrgs will receive
notice from the Commission before the matter is referred to the
Enforcement Bureau for enforcement action and/or penalties imposed by
SMS/800, Inc.
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\44\ SMS/800, Inc. observes that some of its billing and contact
information may contain additional proprietary and confidential data
and that it would require the Commission to ensure the
confidentiality of any such information provided. See SMS/800, Inc.
Comments at 6. If SMS/800, Inc. is unable to provide the necessary
information without including any confidential information it should
submit, along with the responsive information and/or documents, a
statement in accordance with section 0.459 of the Commission's
rules. 47 CFR 0.459.
\45\ Commission FRN numbers can be obtained by registering in
the Commission's Registration System (CORES) located at: https://apps.fcc.gov/coresWeb/publicHome.do.
\46\ Commission's Registration System (CORES) located at:
https://apps.fcc.gov/coresWeb/publicHome.do.
\47\ The Commission's Regulatory Fees Home Page is located at:
https://www.fcc.gov/regfees.
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17. Any payments RespOrgs must pay SMS/800, Inc. for toll free
number management and administration are unrelated to regulatory fees
assessed by the Commission. Payment of regulatory fees to the
Commission does not relieve a RespOrg from any payment obligations to
SMS/800, Inc.
3. Direct Broadcast Satellite Providers
18. DBS service is a nationally distributed subscription service
that delivers video and audio programming via satellite to a small
parabolic ``dish'' antenna at the subscriber's location. DBS providers
are multichannel video programming distributors (MVPDs), as defined in
section 602(13) of the Act.\48\ These operators of U.S. licensed
geostationary space stations, which are used to provide one-way
subscription video service to consumers in the United States, currently
pay a fee per U.S.-licensed satellite under the category ``Space
Station (Geostationary Orbit)'' in the regulatory fee schedule based on
the International Bureau FTEs work associated with satellite
regulation. Cable television and IPTV, also MVPDs, similarly provide
subscription video services to consumers in the United States. These
regulated entities pay a regulatory fee per subscriber under the fee
category ``Cable TV System, Including IPTV.'' \49\ In the Further
Notice of Proposed Rulemaking accompanying the FY 2014 Report and
Order, the Commission proposed to adopt a fee to recover the costs
incurred by the Media Bureau for regulation of DBS.\50\ Under our
proposal, DBS providers would be subject to two regulatory fees. The
first fee would recover the burden of regulation and oversight by
International Bureau FTEs incurred as a result of its operation of
satellites, and the other fee would recover the burden of regulation
and oversight by Media Bureau FTEs as a result of DBS status as a MVPD.
We conclude that DBS providers are subject to regulation and oversight
of the Media Bureau and should share in the Media Bureau FTE burden
attributed to MVPDs. Accordingly, pursuant to section 9(b)(3), we amend
the regulatory fee schedule to replace the category ``Cable TV System,
Including IPTV'' with the ``Cable TV System, Including IPTV and DBS''
category. This category will now have two rates: One for DBS (a
subcategory) and another for cable television and IPTV.
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\48\ 47 U.S.C. 522(13).
\49\ In FY 2014, the regulatory fee for ``Cable TV System,
Including IPTV'' was $0.99 per subscriber. FY 2014 Report and Order,
79 FR 54190, 54208-54212 (September 11, 2014). Cumulatively, the
Cable TV System, Including IPTV fee category paid $64.35 million in
regulatory fees for FY 2014.
\50\ FY 2014 Further Notice of Proposed Rulemaking, 79 FR 63883,
63886-63887, paras. 10-15 (October 27, 2014).
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19. Background. The Commission has considered the appropriate
methodology for assessing regulatory fees on DBS providers on multiple
occasions. The
[[Page 43023]]
original fee schedule adopted by Congress in 1993, when the DBS service
was a nascent industry,\51\ did not include a specific fee category for
DBS providers.\52\ The Commission recognized this and declined to adopt
a regulatory fee for DBS until fiscal year 1996.\53\ In the FY 1996
NPRM, the Commission determined that including the fledgling DBS
service in the regulatory fee imposed on geostationary orbit
geosynchronous satellite category best reflected the regulatory burden
born by the Commission at that time.\54\ In the 2005,\55\ 2006,\56\ and
2008 \57\ regulatory fee proceedings, the Commission also considered
whether DBS should pay a subscriber-based regulatory fee related to
Media Bureau oversight instead of being included in the geosynchronous
satellite category related to International Bureau oversight. In those
proceedings, the Commission either declined to adopt a change or made
no decision on the issue. In the FY 2005 Report and Order, in declining
to make a change, the Commission noted its FY 2005 NPRM had not
contained a proposal on the issue.\58\ In the FY 2006 Report and Order,
the Commission decided not to change the fee. In the FY 2009 Report and
Order, the Commission declined to address the issue raised in the FY
2008 Report and Order and Further Notice.\59\
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\51\ Implementation of Section 9 of the Communications Act,
Assessment and Collection of Regulatory Fees for the 1994 Fiscal
Year, Report and Order, 59 FR 30984, 30994, para. 85 (June 16, 1994)
(FY 1994 Report and Order) (declining to adopt a regulatory fee for
DBS under the Mass Media fees and noting that DBS service is not
expected to be offered prior to the time for calculating fee
payments for FY 1994).
\52\ In the Appendix to the FY 1994 Report and Order published
in the Federal Register, the Commission noted that DBS was not
included in the original fee schedule adopted by Congress and
observed ``that the omission of DBS and FM translators and boosters
was inadvertent and that Congress did not intend to exempt all DBS
permittees and licensees and licensees of FM translators and
boosters from regulatory fees as these services result in the
Commission incurring costs for necessary regulatory functions. . . .
we intend to add regulatory fee categories for DBS licenses and for
FM translators and boosters. . . .'' 59 FR 30984, 31006, note 2.
\53\ Assessment and Collection of Regulatory Fees for Fiscal
Year 1996, Report and Order, 61 FR 36629, 36652, para 35 in Appendix
F (July 12, 1996) (FY 1996 Report and Order) (imposing regulatory
fee for the first time on DBS relying on the analysis in the FY 1996
NPRM); Assessment and Collection of Regulatory Fees for Fiscal Year
1996, Notice of Proposed Rulemaking, 61 FR 16432, 16436, para.
41(April 15, 1996) (FY 1996 NPRM) (proposing to assess DBS licensees
the fee applicable to all geostationary orbit geosynchronous
satellite licensees and, therefore, to include DBS for regulatory
fee purposes in the Space Station fee category).
\54\ FY 1996 NPRM, 61 FR 16432, 16436, para.41 (April 15, 1996).
\55\ Assessment and Collection of Regulatory Fees for Fiscal
Year 2005, Report and Order and Order on Reconsideration, 70 FR
41967, 41969, para 11 (July 21, 2005) (FY 2005 Report and Order). In
2005, the Commission declined to adopt changes in the regulatory fee
assessment methodology for DBS providers in response to the comments
of the National Cable and Telecommunications Association and
American Cable Association. Id. The FY 2005 NPRM did not contain a
proposal on this issue. See generally, Assessment and Collection of
Regulatory Fees for Fiscal Year 2005, Notice of Proposed Rulemaking,
70 FR 9575 (February 28, 2005).
\56\ Assessment and Collection of Regulatory Fees for Fiscal
Year 2006, Report and Order, 71 FR 43842, 43844-43845, paras. 10-16
(August 2, 2006) (FY 2006 Report and Order) (declining to change the
DBS regulatory fee from a per operational space station fee to a
subscriber based fee); Assessment and Collection of Regulatory Fees
for Fiscal Year 2006, Notice of Proposed Rulemaking, 71 FR 17410,
17411-17412, para. 8 (June 6, 2006) (FY 2006 NPRM) (seeking comment
on the appropriate regulatory fee structure for both cable operators
and DBS providers).
\57\ FY 2008 Report and Order and Further Notice, 73 FR 50285,
50290, para. 26 (August 26, 2008) (seeking comment on whether the
Commission should impose the same per subscriber fee on DBS that
cable providers pay, or continue to assess a space station
regulatory fee for the DBS industry and a subscriber-based structure
for the cable industry).
\58\ FY 2005 Report and Order, 70 FR 41967, 41969, para. 11
(July 21, 2005).
\59\ Assessment and Collection of Regulatory Fees for Fiscal
Year 2009, Report and Order, 74 FR 40089, 40089, para 3 (August 11,
2009) (FY 2009 Report and Order) (the Commission noted that the
remaining outstanding issues from the FY 2008 Report and Order and
Further Notice would be decided at a later time).
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20. In August of 2012, the GAO Report concluded that regulatory fee
reform at the Commission was long overdue.\60\ The GAO Report observed,
among other things, that questions had been raised by commenters
regarding whether the Commission's regulatory fee analysis was based on
a ``valid FTE analysis'' of Media Bureau FTEs work related to the MVPDs
including DBS.\61\ Following the GAO Report, in the fiscal year 2013
regulatory fee proceeding, the Commission considered and adopted a
number of significant regulatory fee reforms such as updating the FTEs
allocated to each of the core bureaus and reclassifying most of the
International Bureau FTEs as indirect.\62\ The Commission also adopted
other reforms such as broadening the cable television category to
include IPTV providers as a ``permitted amendment.'' \63\ As part of
its overall analysis of the cable television systems category, the
Commission considered a change to the DBS fee schedule.\64\ While the
Commission declined to do so in 2013 to allow additional time to
examine the proposal as part of larger reform efforts, the Commission
noted its intent to revisit the issue in the future.\65\ In 2014, the
Commission again proposed to adopt a fee to recover the costs incurred
by the Media Bureau for regulation of DBS in the FY 2014 NPRM and the
FY 2014 Further Notice of Proposed Rulemaking.\66\ Alternatively, the
Commission sought comment on whether Media Bureau FTEs working on DBS
issues be assigned to the International Bureau as direct FTEs or
assigned as indirect FTEs for regulatory fee purposes.\67\
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\60\ See note 22, supra. We have adopted significant regulatory
fee reforms in our annual regulatory fee proceedings in response to
the GAO Report. See, e.g., FY 2013 Report and Order, 78 FR 52433,
52436, para. 12-14 (August 23, 2013) (using current FTE data to
calculate regulatory fees).
\61\ GAO Report at 18-20.
\62\ See FY 2013 Report and Order, 78 FR 52433, 52436-52438,
para. 12-22 (August 23, 2013).
\63\ FY 2013 Report and Order, 78 FR 52433, 52439, 52444, paras.
31, 36 (August 23, 2013).
\64\ FY 2013 Report and Order, 78 FR 52433, 52443-52444, paras.
35-36 (August 23, 2013); Assessment and Collection of Regulatory
Fees for Fiscal Year 2013, Notice of Proposed Rulemaking and Further
Notice of Proposed Rulemaking, 78 FR 34612, 34627-34628, paras. 56-
58 (June 10, 2013) (FY 2013 NPRM).
\65\ FY 2013 Report and Order, 78 FR 52433, 52439, para. 31
(August 23, 2013) (``We will continue to examine these suggestions
as we continue our regulatory fee reform, as well as our proposals
that we do not reach in this Report and Order: To combine the ITSP
and wireless categories, to use revenues in calculating all
regulatory fees, and to include DBS providers in a new MVPD
category. We find additional time is necessary and appropriate to
examine these proposals under Section 9 of the Communications Act
and analyze how these proposals account for changes in the
communications industry and the Commission's regulatory processes
and staffing.'') (footnotes omitted) and para. 33.
\66\ FY 2014 Further Notice of Proposed Rulemaking, 79 FR 63883,
63885-63886, paras. 10-15 (October 27, 2014); FY 2014 NPRM, 79 FR
37982, 37990-37991, paras. 47-52 (July 3, 2014).
\67\ FY 2014 Further Notice of Proposed Rulemaking, 79 FR 63883,
63886, para. 13 (October 27, 2014).
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21. Discussion. Under section 9 of the Act, the Commission may make
a permitted amendment to the fee schedule if it ``determines that the
[[Page 43024]]
Schedule requires amendment to comply with the requirements of''
paragraph (1)(A) which mandates that the Commission allocate fees to
cover the costs of certain regulatory activities in accordance with the
benefits provided to the payor and other factors that the Commission
determines are in the public interest.\68\ The statute also provides,
however, that, ``[i]n making such amendments, the Commission shall add,
delete, or reclassify services in the Schedule to reflect additions,
deletions or changes in the nature of its services as a consequence of
Commission rulemaking proceedings or changes in law.'' \69\ We have
conducted a review of the Media Bureau work devoted to MVPD matters and
find that the recommendations in the GAO Report were correct.\70\
Analysis of the oversight and regulation of MVPDs (including the DBS
industry) by the Media Bureau in various rulemaking proceedings reveal
a cumulative effect of changes in law that have taken effect since the
Commission adopted the current DBS regulatory fee structure in 1996.
Due to these changes, we find that the DBS providers should be included
in the same fee category as the other MVPDs, such as cable television
and IPTV. There are certain rules that both DBS providers and cable
operators including IPTV are subject to, and Media Bureau FTEs provide
the oversight and regulation of the DBS industry as required by these
rules.\71\ For example, DBS providers (and cable television operators)
are permitted to file program access complaints \72\ and complaints
seeking relief under the retransmission consent good faith rules.\73\
In addition, DBS providers are subject to MVPD requirements such as
those pertaining to program carriage \74\ and the requirement to
negotiate retransmission consent in good faith.\75\ More recently, the
Commission adopted a host of requirements that apply to all MVPDs and
thus equally apply to DBS providers as part of its implementation of
the Commercial Advertisement Loudness Mitigation Act (CALM Act),\76\
the Twenty-First Century Communications and Video Accessibility Act of
2010 (CVAA),\77\ as well as the Satellite Television Extension and
Localism Act (STELA) Reauthorization Act of 2014 (STELAR).\78\ These
regulatory developments increased the amount of regulatory activity by
the Media Bureau FTEs involving regulation and oversight of MVPDs,
including the DBS providers. The Media Bureau has been responsible for
adopting many of these regulations and overseeing the MVPD industry. As
MVPDs, DBS providers actively participate in Media Bureau proceedings
involving MVPD oversight and regulation.\79\
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\68\ 47 U.S.C. 159(b)(3).
\69\ 47 U.S.C. 159(b)(3).
\70\ The GAO Report did not have a specific recommendation with
respect to the DBS regulatory fee, but observed that the National
Cable and Telecommunications Association had argued that our
regulatory fee process was competitively disadvantaging the cable
television industry. GAO Report at 18-19. Competition per se is not
part of the permitted amendment analysis; however, in this case the
Media Bureau FTEs work on MVPD issues that include DBS.
\71\ See, e.g., 47 CFR 76.65(b); 76.1000-1004; 47 U.S.C. 618(b).
\72\ 47 U.S.C. 548; 47 CFR 76.1000-1004.
\73\ 47 U.S.C. 325(b)(1), (3)(C)(ii); 47 CFR 76.65(b).
\74\ 47 U.S.C. 536; 47 CFR 76.1300-1302.
\75\ 47 U.S.C. 325(b)(3)(C)(iii); 47 CFR 76.65(a)-(b).
\76\ See Implementation of the Commercial Advertisement,
Loudness Mitigation (CALM) Act, Report and Order, 77 FR 40276 (July
9, 2012) (CALM Act Report and Order).
\77\ Public Law 111-260, 124 Stat. 2751 (2010). See also
Amendment of Twenty-First Century Communications and Video
Accessibility Act of 2010, Public Law 111-265, 124 Stat. 2795 (2010)
(making corrections to the CVAA); 47 CFR part 79.
\78\ The STELA Reauthorization Act of 2014 (STELAR), 102, Public
Law 113-200, 128 Stat. 2059, 2060-62 (2014) (codified at 47 U.S.C.
338(1)). The STELAR was enacted on Dec. 4, 2014 (H.R. 5728, 113th
Cong.). Implementation of Section 102 of the STELA Reauthorization
Act of 2014, Notice of Proposed Rulemaking, MB Docket No. 15-71, FCC
15-34 (rel. Mar. 26, 2015) proposes satellite television ``market
modification'' rules to implement section 102 of STELAR.
\79\ NCTA and ACA Comments at 7, 10-11; ITTA Comments at 3.
DIRECTV and DISH filed comments and ex parte statements in numerous
Commission proceedings, in the Media Bureau dockets as well as other
dockets. As of Mar. 17, 2015, in the past 12 months, DIRECTV filed
109 comments and ex parte statements in Media Bureau (and other)
dockets. There are other proceedings, such as mergers, in which
DIRECTV and DISH have participated. Regardless of whether the
proceeding is merger-related or pertains strictly to MVPD
regulation, DBS participation, and Media Bureau staff involvement,
support our conclusion that DBS providers should be added to the
cable television and IPTV category.
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22. DIRECTV and DISH disagree that a permitted amendment is
justified, contending that there has been no ``meaningful increase in
the regulation of DBS.'' \80\ To the contrary, as discussed above,
implementation of the CALM Act, CVAA, and STELAR should alone provide
adequate justification for a permitted amendment in this case. A
permitted amendment under section 9(b)(3), however, does not require a
sudden increase in regulation or oversight over a defined period of
time. Circumstances have changed in the almost 20 years since the
Commission first addressed the issue of DBS regulatory fees.\81\ At the
time we adopted a DBS regulatory fee, it was a fledging service where
the business model was uncertain and there were questions concerning
whether it would operate as a subscription based service or a free to
air broadcaster.\82\ The first DBS satellite was not launched until
1993 and did not become operational until 1994.\83\ In 2015, however,
DBS had developed into a large MVPD \84\ and as such significant Media
Bureau FTE resources are used in regulation and oversight of DBS. The
GAO Report correctly noted that an evaluation of Media Bureau FTEs was
long overdue \85\ and the result of such evaluation leads us to the
conclusion that the Media Bureau FTEs regulate the DBS industry
together with the other MVPDs. Thus, there is no reasonable basis to
exclude DBS providers from sharing in the cost of MVPD oversight and
regulation. With this Report and Order, we recognize the changes in
fact and law since the adoption of the DBS fee in 1996 cumulatively
require us to adopt a permitted amendment to ensure that DBS providers
contribute equitably to the FTE burden of MVPD oversight.\86\
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\80\ DIRECTV and DISH Comments at 8-9.
\81\ The Commission's annual MVPD Competition Report provides a
history of MVPD services. Annual Assessment of the Status of
Competition in the Market for the Delivery of Video Programming,
Report, 9 FCC Rcd 7442 (1994) (First Report); 11 FCC Rcd 2060 (1996)
(Second Report); 12 FCC Rcd 4358 (1997) (Third Report); 13 FCC Rcd
1034 (1998) (Fourth Report); 13 FCC Rcd 24284 (1998) (Fifth Report);
15 FCC Rcd 978 (2000) (Sixth Report); 16 FCC Rcd 6005 (2001)
(Seventh Report); 17 FCC Rcd 1244 (2002) (Eighth Report); 17 FCC Rcd
26901 (2002) (Ninth Report); 19 FCC Rcd 1606 (2004) (Tenth Report);
20 FCC Rcd 2755 (2005) (Eleventh Report); 21 FCC Rcd 2503 (2006)
(Twelfth Report); 24 FCC Rcd 542 (2007) (Thirteenth Report); 27 FCC
Rcd 8610 (2012) (Fourteenth Report); 28 FCC Rcd 10496 (2013)
(Fifteenth Report).
\82\ FY 1996 Report and Order, 61 FR 36629, 36652, Appendix F,
para. 35 (July 12, 1996). DBS space stations applicants must
indicate in their license application whether they seek to operate
on a broadcast or non-broadcast basis, which affects the length of
their license terms. Inquiry into the Development of Regulatory
Policy in regard to Direct Broadcast Satellites for the Period
Following the 1982 Regional Administrative Radio Conference, Report
and Order, 90 FCC 2d 676 (1982), aff'd sub nom National Association
of Broadcasters v. F.C.C., 740 F.2d 1190 (1984). To date, neither
DIRECTV nor DISH has elected to operate as a broadcaster.
\83\ First Report, 59 FR 64657, 64659, paras. 21-22 (December
15, 1994).
\84\ Fifteenth Report, 28 FCC Rcd at 10546-49, paras. 110-117
(describing DBS MVPD business models and competitive strategies).
\85\ GAO Report at 17-20.
\86\ 47 U.S.C. 159(b)(3). See, e.g., 47 CFR 76.65(b); 76.1000-
1004; Part 79; 47 U.S.C. 618(b).
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\23.\ We also reject the argument raised by DIRECTV and DISH that
section 9 of the Act requires us to ``show that DBS and cable occupy a
comparable number of FTEs.'' \87\ The commenters' argument that DBS is
not involved in certain matters such as petitions for effective
[[Page 43025]]
competition,\88\ or other requirements that do not pertain to DBS,\89\
demonstrates that DBS is not identical to cable television. It does
not, however, refute our conclusion that a significant number of Media
Bureau FTEs work on MVPD issues that include DBS.\90\ The Commission
has determined in other proceedings that services that are not
technologically identical nevertheless warrant placement in the same
regulatory fee category. Other fee categories, such as Interstate
Telecommunications Service Providers (ITSP), also include a range of
carriers that may not be regulated identically.\91\ For example, when
interconnected Voice over Internet Protocol (VoIP) providers were added
to the ITSP category in a permitted amendment the Commission observed
that ``the costs and benefits associated with our regulation of
interconnected VoIP providers are not identical as those associated
with regulating interstate telecommunications service and CMRS.'' \92\
The Commission stated that ``Section 9 is clear, however, that
regulatory fee assessments are based on the burden imposed on the
Commission, not benefits realized by regulatees.'' \93\ Concerning many
aspects of MVPD regulation, Media Bureau FTEs bear the same burden
regardless of the specific technology used by the service provider.
Thus, although DBS is not identical to cable television and IPTV, the
services all receive oversight and regulation as a result of the work
of Media Bureau FTEs on MVPD issues. The burden imposed on the
Commission is therefore similar.
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\87\ DIRECTV and DISH Comments at 11 & Reply Comments at 4-9.
\88\ DIRECTV and DISH Comments at 12.
\89\ DIRECTV and DISH Comments at 12 (these are (1) a
requirement to encrypt the basic service tier, (2) the viewability
requirements in sections 614 and 615 of the Act, and (3) the
requirement to include certain digital interfaces on high definition
set-top boxes).
\90\ See, e.g., Closed Captioning Report and Order, 79 FR 17911
(March 31, 2014), 79 FR 17093 (March 31, 2014); CALM Act Report and
Order, 77 FR 40276 (July 9, 2012); 76.1000-1004; part 79; 47 U.S.C.
618(b).
\91\ ITSP, regulated by the Wireline Competition Bureau,
includes interexchange carriers (IXCs), incumbent local exchange
carriers (LECs), toll resellers, Voice over Internet Providers
(VoIP), and other service providers, all of which involve different
degrees of regulatory oversight. See NCTA and ACA Comments at 9 &
Reply Comments at 8-9.
\92\ See Assessment and Collection of Regulatory Fees for Fiscal
Year 2007, Report and Order and Further Notice of Proposed
Rulemaking, 72 FR 45908, 45912, para. 19 (August 16, 2007) (FY 2007
Report and Order).
\93\ FY 2007 Report and Order, 72 FR 45908, 45912, para. 19
(August 16, 2007).
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24. DIRECTV and DISH also observe that there are more cable
operators and cable systems than DBS operators, and that the cable
industry has a larger filing and recordkeeping requirement than
DBS.\94\ While we agree that the two DBS providers and their trade
association had fewer filings than the top 25 cable operators and their
two trade associations (combined), we are not persuaded that this
demonstrates a lack of Media Bureau oversight and regulation of the DBS
industry.\95\ We are therefore including DBS providers into the same
regulatory fee category as cable television and IPTV because many Media
Bureau issues involve the entire MVPD industry. We find that it is
appropriate under section 9 of the Act to recover the costs associated
with Media Bureau FTE work.\96\ As we explain below, however, DBS will
have an opportunity to raise questions concerning the rate calculation
between it and other members of the same fee category for fiscal year
2015 and in the future.\97\ The video programming and distribution
industry continues to change \98\ and the appropriate allocation
between and among regulatees with respect to Media Bureau FTEs working
on MVPD issues may change over time as different regulatory and legal
issues are presented to the Commission.
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\94\ DIRECTV and DISH Comments at 13. DIRECTV and DISH compare
the number of filings in our electronic comment filing system (ECFS)
and observe that over a two year period DIRECTV and DISH and their
trade association filed 4,870 pages in 401 proceedings and the top
25 cable companies and their two trade associations filed 93,673
pages in 2,217 proceedings. DIRECTV and DISH Comments at 13, note
53.
\95\ In the 12 months prior to Mar. 17, 2015, Comcast
Corporation (the largest cable company in the country) had 297 total
ECFS filings, DIRECTV had 109, and DISH Network had 134 (some
filings were by DIRECTV and DISH together), a not unexpected
relative volume of ECFS filings for the top three MVPDs in the
country.
\96\ 47 U.S.C. 159(a)(1).
\97\ Even when an industry has oversight generally by one
organizational unit within the Commission, we are sensitive to the
fact that balance between members of the same industry may require
adjustments to FTE allocations. See, e.g., recent changes in FTE
allocations between space station and earth stations even though
such systems are may operate in the same spectrum and be part of the
same telecommunication system. FY 2014 Report and Order, 79 FR
54190, 54192-54193, paras. 11-15 (September 11, 2014).
\98\ See, e.g., Promoting Innovation and Competition in the
Provision of Multichannel Video Programming Distribution Services,
Notice of Proposed Rulemaking, 29 FCC Rcd 15995 (2014) (seeking
comment on, inter alia, expanding the definition of MVPD to include
providers of multiple linear streams of video programming,
regardless of the technology used to distribute it.)
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25. To the extent that DIRECTV and DISH are suggesting by these
arguments that the number of FTEs dedicated to a service is wholly
determinative of their regulatory fees, we disagree. Although the
statute requires us to calculate FTEs initially, we are also required
to ``adjust[]'' that number ``to take into account factors that are
reasonably related to the benefits provided to the payor of the fee by
the Commission's activities.'' \99\ Since DBS providers generally
benefit from the regulatory activities of the Media Bureau, much like
cable operators and IPTV providers, the Commission can attribute Media
Bureau FTEs to DBS providers and require them to pay Media Bureau
regulatory fees.
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\99\ 47 U.S.C. 159(b)(1)(A).
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26. DIRECTV and DISH also argue that because we declined to include
DBS in the cable television and IPTV regulatory fee category
previously, we must provide a reasoned explanation for changing our fee
determination.\100\ We agree that it serves the public interest to
explain our rationale. A prior decision, however, does not preclude us
from making a different determination in light of the facts and
circumstances presented to the Commission in 2015. When the Commission
first determined to include DBS in the geosynchronous satellite
regulatory fee, DBS was a new service with an uncertain business model.
Imposing a subscription based fee derived from Media Bureau FTEs risked
failing to compensate the Commission for the substantive work
regulating DBS as a satellite industry.\101\ When we examined the issue
again in 2005, 2006, and 2008, contemporaneously there was a
significant amount of regulatory work being done by the International
Bureau related to making new spectrum available for satellite based
video services.\102\ Thus, it is not surprising that the Commission
concluded in 2006 that the existing methodology
[[Page 43026]]
adequately ensured recovery of International Bureau FTE burden of
oversight and regulation. Further, removing DBS from the geosynchronous
satellite regulatory fee category at a time when that fee category bore
the burden of substantial rulemakings relating to new satellite
spectrum would have been a complex issue. While the burden of new
satellite rulemakings was not mentioned by the Commission in the FY
2006 Report and Order, review of the context in which decisions are
made is appropriate here. Further, in the past, changes to the DBS
regulatory fee was frequently described as either a fee assessed based
on International Bureau FTEs or a fee based on Media Bureau FTEs. In
contrast, our proposal presents a more nuanced approach of recognizing
that the work of both the International Bureau FTEs and the Media
Bureau FTEs provide oversight and regulation of DBS. As a result, while
the decisions made in the past are understandable in their context, we
are not bound to disregard the FTE burden born by the Media Bureau in
regulating DBS as a MVPD simply because we previously declined to
change the methodology of assessing fees on DBS providers.
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\100\ DIRECTV and DISH Comments at 15-17 & Reply Comments at 10-
11.
\101\ FY 1996 NPRM, 61 FR 16432, 16436, para. 41 (April 15,
1996) (``Moreover, because DBS licensees are not restricted to the
provision of video programming, but rather may provide various non-
video services, we concluded that a facility-based fee would ensure
that each DBS licensee contributed equitably to the cost of DBS
regulation without the need to impose possibly burdensome and overly
intrusive reporting requirements necessary to gather information
identifying the services offered by individual DBS operators.'')
\102\ Establishment of Policies and Service Rules for the
Broadcasting Satellite Service at the 17.3-17.7 GHz Frequency Band
and at the 17.7-17.8 GHz Frequency Band Internationally, and at the
24.75-25.25 GHz Frequency Band for Fixed Satellite Services
Providing Feeder Links to the Broadcasting-Satellite Service and for
the Broadcasting Satellite Service Operating Bidirectionally in the
17.3-17.7 GHz Frequency Band, Notice of Proposed Rulemaking, 72 FR
46939 (August 22, 2007), Report and Order and Further Notice of
Proposed Rulemaking, 72 FR 50000 (August 29, 2007); Amendment of the
Commission's Policies and Rules for Processing Applications in the
Direct Broadcast Satellite Service, Notice of Proposed Rulemaking,
21 FCC Rcd 9443 (2006). See Thirteenth Report, 74 FR 11102, at para.
(March 16, 2009).
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27. Regulatory fee reform is a logistical challenge due to the time
constraints in regulatory fee proceedings which typically must be
completed in a year in order to satisfy our statutory mandate.
Unfortunately, at times we must decline to adopt a proposal or take an
incremental approach, not because a proposal lacks merit, but simply
because there is insufficient time to address the substantive comments
raised in the record in the time allotted.\103\ In this instance,
however, we have the benefit of comments regarding this issue from the
FY 2013 NPRM, the FY 2014 NPRM, and the FY 2014 Further Notice of
Proposed Rulemaking. As a result, unlike prior review of this issue, we
have had more time within which to review the significant issue of
adopting an additional fee category for DBS providers. The GAO Report
also brought new focus to conducting the necessary analysis of Media
Bureau FTEs as part of our overall regulatory fee reform.\104\ Had the
Commission performed this analysis of Media Bureau FTEs and regulation
and oversight of DBS earlier, we may have reached this result at that
time. The Commission may update its regulatory fee methodology when,
among other things, it is supported by updated data, analysis, and
changes in the regulation and oversight of the industry. As the GAO
Report observed, it is important to ``regularly update analyses to
ensure that fees are set based on relevant information.'' \105\
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\103\ See, e.g., FY 2006 Report and Order, 71 FR 43842, 43845,
para 16 (August 6, 2006) (``Finally, as a practical matter, we do
not have sufficient time available to modify the section 9
regulatory fee classification and methodology as proposed by NCTA
and still comply with the 90-day congressional notification
requirement before we start our regulatory fee collections in the
August/September time frame.'')
\104\ See, e.g., FY 2013 Report and Order, 78 FR 52433, 52436,
paras. 12-14 (August 23, 2013).
\105\ GAO Report at 12.
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28. Finally, DISH and DIRECTV contend that a ``fee increase will
cause rate shock'' \106\ and argue that we must explain the basis of
any regulatory fee increase exceeding 7.5 percent relying upon a cap we
adopted for FY 2013.\107\ We note first that it is somewhat premature
to address this concern since the rate for DBS providers is merely
proposed in the accompanying NPRM, and DISH and DIRECTV, the two DBS
providers, may provide comments on the rate for this year and in
subsequent years. As to the substance of the complaint, we note that
this cap was adopted due to the significant regulatory fee changes
adopted that year and our concern on the impact on small entities;
neither DISH nor DIRECTV claim that they are small entities. We are not
required to adopt a cap every year and we are not seeking comment on
such a cap for FY 2015 in our NPRM above. Due to their concern that the
regulatory fee would have such an impact on their customers, we have
decided to phase in the DBS fee and introduce it initially as a
subcategory of the cable television and IPTV category.\108\ This phased
approach is consistent with the interim approach the Commission took in
the FY 2013 Report and Order to ``avoid sudden and large changes in the
amount of fees'' \109\ and addresses DIRECTV and DISH's concerns.\110\
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\106\ DIRECTV and DISH Comments at 11.
\107\ DIRECTV and DISH Comments at 15-17 & Reply Comments at 10-
11.
\108\ Commenters propose a three-year phase-in period. See NCTA
and ACA Comments at 14-15.
\109\ FY 2013 Report and Order, 78 FR 52433, 52439, para. 28
(August 23, 2013).
\110\ In FY 2014, DIRECTV and DISH paid approximately $2.49
million in international regulatory fees for 20 satellites and 141
earth stations. Assuming these DBS providers pay for the same number
of satellite and earth station units, the Commission estimates that
in FY 2015 their total fees paid would be $2.72 million (satellites
and earth stations) plus $2.72 million (media services) for a total
of $5.44 million.
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29. We also note that we sought comment on whether the operator of
the satellite or the provider of DBS service should be the entity that
pays the regulatory fee.\111\ As the fee is based on subscriber
numbers, the DBS service provider would be the entity with this
information and it would be more efficient for those DBS providers to
be responsible for the regulatory fee. For purposes of calculating
regulatory fees, the subscriber count includes single family dwellings
as well as individuals in multiple dwelling units (e.g., apartments,
condominiums, mobile home parks) based on the formula in the footnote
below.\112\
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\111\ FY 2014 Further Notice of Proposed Rulemaking, 79 FR
63883, 63886, para. 13 (October 27, 2014).
\112\ DBS providers, cable television system operators, and IPTV
providers 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. Providers and operators
may base their count on ``a typical day in the last full week'' of
December 2014, rather than on a count as of December 31, 2014.
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30. In the FY 2014 Further Notice of Proposed Rulemaking, we
further sought comment on whether, in lieu of a permitted amendment,
Media Bureau FTEs working on DBS issues should be assigned to the
International Bureau as direct FTEs or assigned as indirect FTEs.\113\
These alternatives would, in some ways, allocate the Media Bureau FTEs
for regulatory fee purposes in a way that is fairer than the current
allocation. DBS providers would be paying regulatory fees for some of
the Media Bureau FTEs, if reallocated as direct FTEs to the
International Bureau. If we reallocated some Media Bureau FTEs as
indirect, the regulatory fee burden would be spread among all
regulatory fee payors, which would relieve the burden on the cable
television and IPTV industry. Although these two alternatives would
serve to reallocate a portion of the Media Bureau FTEs, such
reallocation would either shift the burden to all International Bureau
regulatees or to all regulatory fee payors, instead of to the DBS
providers. Thus, although those two alternative proposals might be an
improvement over the status quo, including DBS in the same category as
cable television and IPTV, and basing the regulatory fee on Media
Bureau FTEs, is the more straightforward and equitable approach because
the DBS regulation and oversight is done by the Media Bureau FTEs.
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\113\ FY 2014 Further Notice of Proposed Rulemaking, 79 FR
63883, 63886, para. 13 (October 27, 2014).
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31. Under section 9 of the Act, the Commission must add, delete, or
reclassify services in the fee schedule to reflect additions,
deletions, or changes in the nature of its services ``as a
[[Page 43027]]
consequence of Commission rulemaking proceedings or changes in law.''
\114\ As explained above, after analyzing the oversight and regulation
of MVPDs (including DBS) by the Media Bureau in various rulemaking
proceedings, MVPDs (including DBS providers) are subject to increased
regulation and oversight due to changes in law, and therefore DBS
should be included in the same fee category as cable television and
IPTV, as a permitted amendment. Since two different sets of FTE
resources are involved, the Commission is assessing two separate fees
on DBS providers, a satellite fee based on International Bureau FTEs
and a fee based on Media Bureau FTEs, assessed per DBS subscriber. This
adoption of a fee subcategory for DBS within the cable television and
IPTV category is a permitted amendment as defined in section 9(b)(3) of
the Act, which, pursuant to section 9(b)(4)(B), must be submitted to
Congress at least 90 days before it becomes effective.\115\
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\114\ 47 U.S.C. 159(b)(3).
\115\ 47 U.S.C. 159(b)(4)(B).
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32. In the Order portion of the rulemaking, the Commission makes
ministerial changes to sections 1.911(d), 1.1912(b)(1), and 1.1917(c)
of the Commission's rules \116\ to conform to the Digital
Accountability and Transparency Act (DATA Act).\117\ In particular, the
Commission amends the rule provisions to specify that debts owed to the
Commission that have been delinquent for a period of 120 days shall be
transferred to the Secretary of the Treasury.\118\ These amendments are
to conform the Commission's rules to the DATA Act and the notice and
comment and effective date provisions of the Administrative Procedure
Act are inapplicable.\119\
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\116\ 47 CFR 1.1911(d), 1.1912(b)(1), 1.1917(c).
\117\ 31 U.S.C. 3716(c)(6).
\118\ The full text of the new rules is contained in the Rule
Change section of this document.
\119\ 5 U.S.C. 553(b)(3)(A).
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Final Regulatory Flexibility Analysis
1. As required by the Regulatory Flexibility Act of 1980, as
amended (RFA),\120\ an Initial Regulatory Flexibility Analysis (IRFA)
was included in the Report and Order and Further Notice of Proposed
Rulemaking.\121\ The Commission sought written public comment on these
proposals including comment on the IRFA. This Final Regulatory
Flexibility Analysis (FRFA) conforms to the IRFA.\122\
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\120\ 5 U.S.C. 603. The RFA, 5 U.S.C. 601-612 has been amended
by the Small Business Regulatory Enforcement Fairness Act of 1996
(SBREFA), Public Law 104-121, Title II, 110 Stat. 847 (1996).
\121\ Assessment and Collection of Regulatory Fees for Fiscal
Year 2014, Report and Order and Further Notice of Proposed
Rulemaking, MD Docket No. 14-92, 79 FR 63883 (October 27, 2014)
(Further Notice).
\122\ 5 U.S.C. 604.
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A. Need for, and Objectives of, the Report and Order
2. In this Report and Order, we eliminate two categories from the
regulatory fee schedule: Amateur radio Vanity Call Signs and General
Mobile Radio Service (GMRS). We also include direct broadcast satellite
(DBS) providers in the cable television and IPTV regulatory fee
category, as a subcategory. To aid in the implementation of new
regulatory fees for Responsible Organizations (RespOrgs) adopted in the
fiscal year 2014 proceeding, we direct the Managing Director to
coordinate with SMS/800, Inc. to ensure that all RespOrgs owing
regulatory fees have sufficient information about this process and
opportunity to pay the regulatory fee before the RespOrg is placed in
red light status and enforcement procedures are initiated.
3. Our regulatory fee for DBS providers, adopted herein, will
include DBS providers in the category of cable television operators and
IPTV providers, but at a lower regulatory fee rate. This rule was
adopted because the Media Bureau staff spend approximately as much time
working on issues that include DBS as cable television and IPTV. For
the most part, the rules and policies addressed by the Media Bureau
include DBS and cable television, as well as IPTV. Under section 9 of
the Commission's rules, the DBS industry should contribute to these
regulatory fees, otherwise the cable television and IPTV industries are
paying for costs that should be shared with DBS.
B. Summary of the Significant Issues Raised by the Public Comments in
Response to the IRFA
4. None.
C. Description and Estimate of the Number of Small Entities to Which
the Rules Will Apply
5. 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.\123\ The RFA
generally defines the term ``small entity'' as having the same meaning
as the terms ``small business,'' ``small organization,'' and ``small
governmental jurisdiction.'' \124\ In addition, the term ``small
business'' has the same meaning as the term ``small business concern''
under the Small Business Act.\125\ 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.\126\ Nationwide, there are a total of
approximately 27.9 million small businesses, according to the SBA.\127\
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\123\ 5 U.S.C. 603(b)(3).
\124\ 5 U.S.C. 601(6).
\125\ 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.''
\126\ 15 U.S.C. 632.
\127\ See SBA, Office of Advocacy, ``Frequently Asked
Questions,'' https://www.sba.gov/sites/default/files/FAQ_Sept_2012.pdf.
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6. Wired Telecommunications Carriers. The U.S. Census Bureau
defines this industry as ``establishments primarily engaged in
operating and/or providing access to transmission facilities and
infrastructure that they own and/or lease for the transmission of
voice, data, text, sound, and video using wired communications
networks. Transmission facilities may be based on a single technology
or a combination of technologies. Establishments in this industry use
the wired telecommunications network facilities that they operate to
provide a variety of services, such as wired telephony services,
including VoIP services, wired (cable) audio and video programming
distribution, and wired broadband internet services. By exception,
establishments providing satellite television distribution services
using facilities and infrastructure that they operate are included in
this industry.'' \128\ 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.\129\ Census data for
2007 shows that there were 3,188 firms that operated that year. Of this
total, 3,144 operated with less than 1,000 employees.\130\ Thus, under
this size standard, the majority of firms in this industry can be
considered small.
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\128\ https://www.census.gov/cgi-bin/sssd/naics/naicsrch.
\129\ See 13 CFR 120.201, NAICS Code 517110.
\130\ https://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ECN_2007_US_51SSSZ5&prodType=table.
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7. Local Exchange Carriers (LECs). Neither the Commission nor the
SBA has developed a size standard for small
[[Page 43028]]
businesses specifically applicable to local exchange services. The
closest applicable NAICS Code category is Wired Telecommunications
Carriers as defined in paragraph 6 of this FRFA. Under the applicable
SBA size standard, such a business is small if it has 1,500 or fewer
employees.\131\ According to Commission data, census data for 2007
shows that there were 3,188 firms that operated that year. Of this
total, 3,144 operated with fewer than 1,000 employees.\132\ The
Commission therefore estimates that most providers of local exchange
carrier service are small entities that may be affected by the rules
adopted.
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\131\ 13 CFR 121.201, NAICS code 517110.
\132\ https://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ECN_2007_US_51SSSZ5&prodType=table.
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8. Incumbent LECs. Neither the Commission nor the SBA has developed
a small business size standard specifically for incumbent local
exchange services. The closest applicable NAICS Code category is Wired
Telecommunications Carriers as defined in paragraph 6 of this FRFA.
Under that size standard, such a business is small if it has 1,500 or
fewer employees.\133\ According to Commission data, 3,188 firms
operated in that year. Of this total, 3,144 operated with fewer than
1,000 employees.\134\ Consequently, the Commission estimates that most
providers of incumbent local exchange service are small businesses that
may be affected by the rules and policies adopted. Three hundred and
seven (307) Incumbent Local Exchange Carriers reported that they were
incumbent local exchange service providers.\135\ Of this total, an
estimated 1,006 have 1,500 or fewer employees.\136\
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\133\ 13 CFR 121.201, NAICS code 517110.
\134\ https://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ECN_2007_US_51SSSZ5&prodType=table.
\135\ 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).
\136\ Id.
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9. Competitive Local Exchange Carriers (Competitive LECs),
Competitive Access Providers (CAPs), Shared-Tenant Service Providers,
and Other Local Service Providers. Neither the Commission nor the SBA
has developed a small business size standard specifically for these
service providers. The appropriate NAICS Code category is Wired
Telecommunications Carriers, as defined in paragraph 6 of this FRFA.
Under that size standard, such a business is small if it has 1,500 or
fewer employees.\137\ U.S. Census data for 2007 indicate that 3,188
firms operated during that year. Of that number, 3,144 operated with
fewer than 1,000 employees.\138\ Based on this data, the Commission
concludes that the majority of Competitive LECS, CAPs, Shared-Tenant
Service Providers, and Other Local Service Providers, are small
entities. According to Commission data, 1,442 carriers reported that
they were engaged in the provision of either competitive local exchange
services or competitive access provider services.\139\ Of these 1,442
carriers, an estimated 1,256 have 1,500 or fewer employees.\140\ 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.\141\ Also, 72 carriers have reported that they are Other
Local Service Providers.\142\ Of this total, 70 have 1,500 or fewer
employees.\143\ Consequently, based on internally researched FCC data,
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 the rules adopted.
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\137\ 13 CFR 121.201, NAICS code 517110.
\138\ https://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ECN_2007_US_51SSSZ5&prodType=table.
\139\ See Trends in Telephone Service, at tbl. 5.3.
\140\ Id.
\141\ Id.
\142\ Id.
\143\ Id.
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10. Interexchange Carriers (IXCs). Neither the Commission nor the
SBA has developed a definition for Interexchange Carriers. The closest
NAICS Code category is Wired Telecommunications Carriers as defined in
paragraph 6 of this FRFA. The applicable size standard under SBA rules
is that such a business is small if it has 1,500 or fewer
employees.\144\ U.S. Census data for 2007 indicates that 3,188 firms
operated during that year. Of that number, 3,144 operated with fewer
than 1,000 employees.\145\ According to internally developed Commission
data, 359 companies reported that their primary telecommunications
service activity was the provision of interexchange services.\146\ Of
this total, an estimated 317 have 1,500 or fewer employees.\147\
Consequently, the Commission estimates that the majority of
interexchange service providers are small entities that may be affected
by the rules adopted.
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\144\ 13 CFR 121.201, NAICS code 517110.
\145\ https://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ECN_2007_US_51SSSZ5&prodType=table.
\146\ See Trends in Telephone Service, at Table 5.3.
\147\ Id.
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11. Prepaid Calling Card Providers. Neither the Commission nor the
SBA has developed a small business size standard specifically for
prepaid calling card providers. The appropriate NAICS Code category for
prepaid calling card providers is Telecommunications Resellers. This
industry comprises establishments engaged in purchasing access and
network capacity from owners and operators of telecommunications
networks and reselling wired and wireless telecommunications services
(except satellite) to businesses and households. Mobile virtual
networks operators (MVNOs) are included in this industry.\148\ Under
the applicable SBA size standard, such a business is small if it has
1,500 or fewer employees.\149\ U.S. 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.\150\ 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.\151\ All
193 carriers have 1,500 or fewer employees.\152\ Consequently, the
Commission estimates that the majority of prepaid calling card
providers are small entities that may be affected by the rules adopted.
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\148\ https://www.census.gov/cgi-bin/ssd/naics/naicsrch.
\149\ 13 CFR 121.201, NAICS code 517911.
\150\ https://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ECN_2007_US_51SSSZ5&prodType=table.
\151\ See Trends in Telephone Service, at Table 5.3.
\152\ Id.
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12. 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.\153\ 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.\154\ Under this category
[[Page 43029]]
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.\155\ Of this total, an
estimated 211 have 1,500 or fewer employees.\156\ Consequently, the
Commission estimates that the majority of local resellers are small
entities that may be affected by the rules adopted.
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\153\ 13 CFR 121.201, NAICS code 517911.
\154\ https://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ECN_2007_US_51SSSZ5&prodType=table.
\155\ See Trends in Telephone Service, at tbl. 5.3.
\156\ Id.
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13. Toll Resellers. The Commission has not developed a definition
for Toll Resellers. The closest NAICS Code Category is
Telecommunications Resellers, and the SBA has developed a small
business size standard for the category of Telecommunications
Resellers. Under that size standard, such a business is small if it has
1,500 or fewer employees.\157\ 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.\158\ 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.\159\ Of this total, an estimated
857 have 1,500 or fewer employees.\160\ Consequently, the Commission
estimates that the majority of toll resellers are small entities that
may be affected by the rules adopted.
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\157\ https://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ECN_2007_US_51SSSZ5&prodType=table.
\158\ Id.
\159\ Trends in Telephone Service, at Table 5.3.
\160\ Id.
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14. Other Toll Carriers. Neither the Commission nor the SBA has
developed a definition for small businesses specifically applicable to
Other Toll Carriers. This category includes toll carriers that do not
fall within the categories of interexchange carriers, operator service
providers, prepaid calling card providers, satellite service carriers,
or toll resellers. The closest applicable NAICS Code category is for
Wired Telecommunications Carriers as defined in paragraph 6 of this
FRFA. Under the applicable SBA size standard, such a business is small
if it has 1,500 or fewer employees.\161\ Census data for 2007 shows
that there were 3,188 firms that operated that year. Of this total,
3,144 operated with fewer than 1,000 employees.\162\ Thus, under this
category and the associated small business size standard, the majority
of Other Toll Carriers can be considered small. According to internally
developed Commission data, 284 companies reported that their primary
telecommunications service activity was the provision of other toll
carriage.\163\ Of these, an estimated 279 have 1,500 or fewer
employees.\164\ Consequently, the Commission estimates that most Other
Toll Carriers are small entities that may be affected by the rules and
policies adopted.
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\161\ 13 CFR 121.201, NAICS code 517110.
\162\ https://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ECN_2007_US_51SSSZ5&prodType=table.
\163\ Trends in Telephone Service, at Table 5.3.
\164\ Id.
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15. Wireless Telecommunications Carriers (except Satellite). This
industry comprises establishments engaged in operating and maintaining
switching and transmission facilities to provide communications via the
airwaves, such as cellular services, paging services, wireless internet
access, and wireless video services.\165\ The appropriate size standard
under SBA rules is that such a business is small if it has 1,500 or
fewer employees. For this industry, Census data for 2007 show that
there were 1,383 firms that operated for the entire year. Of this
total, 1,368 firms had fewer than 1,000 employees. Thus under this
category and the associated size standard, the Commission estimates
that the majority of wireless telecommunications carriers (except
satellite) are small entities. Similarly, according to internally
developed Commission data, 413 carriers reported that they were engaged
in the provision of wireless telephony, including cellular service,
Personal Communications Service (PCS), and Specialized Mobile Radio
(SMR) services.\166\ Of this total, an estimated 261 have 1,500 or
fewer employees.\167\ Consequently, the Commission estimates that
approximately half of these firms can be considered small. Thus, using
available data, we estimate that the majority of wireless firms can be
considered small.
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\165\ NAICS Code 517210. See https://www.census.gov/cgi-bin/ssd/naics/naiscsrch.
\166\ Trends in Telephone Service, at Table 5.3.
\167\ Id.
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16. Cable Television and Other Subscription Programming.\168\ Since
2007, these services have been defined within the broad economic census
category of Wired Telecommunications Carriers. That 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.'' \169\ The SBA has developed a small
business size standard for this category, which is: all such firms
having 1,500 or fewer employees.\170\ Census data for 2007 shows that
there were 3,188 firms that operated that year. Of this total, 3,144
had fewer than 1,000 employees.\171\ 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.
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\168\ In 2014, ``Cable and Other Subscription Programming,''
NAICS Code 515210, replaced a prior category, now obsolete, which
was called ``Cable and Other Program Distribution.'' Cable and Other
Program Distribution, prior to 2014, was placed under NAICS Code
517110, Wired Telecommunications Carriers. Wired Telecommunications
Carriers is still a current and valid NAICS Code Category. Because
of the similarity between ``Cable and Other Subscription
Programming'' and ``Cable and other Program Distribution,'' we will,
in this proceeding, continue to use Wired Telecommunications Carrier
data based on the U.S. Census. The alternative of using data
gathered under Cable and Other Subscription Programming (NAICS Code
515210) is unavailable to us for two reasons. First, the size
standard established by the SBA for Cable and Other Subscription
Programming is annual receipts of $38.5 million or less. Thus to use
the annual receipts size standard would require the Commission
either to switch from existing employee based size standard of 1,500
employees or less for Wired Telecommunications Carriers, or else
would require the use of two size standards. No official approval of
either option has been granted by the Commission as of the time of
the release of this Regulatory Fees NPRM and its associated Report
and Order and Order. Second, the data available under the size
standard of $38.5 million dollars or less is not applicable at this
time, because the only currently available U.S. Census data for
annual receipts of all businesses operating in the NAICS Code
category of 515210 (Cable and other Subscription Programming)
consists only of total receipts for all businesses operating in this
category in 2007 and of total annual receipts for all businesses
operating in this category in 2012. The data do not provide any
basis for determining, for either year, how many businesses were
small because they had annual receipts of $38.5 million or less. See
https://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ECN_2012_US_51I2&prodType=table.
\169\ U.S. Census Bureau, 2007 NAICS Definitions, ``517110 Wired
Telecommunications Carriers'' (partial definition), (Full definition
stated in paragraph 6 of this IRFA) available at https://www.census.gov/cgi-bin/sssd/naics/naicsrch.
\170\ 13 CFR 121.201, NAICS code 517110.
\171\ https://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ECN_2007_US-51SSSZ5&prodType=Table.
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17. Cable Companies and Systems. The Commission has developed its
own small business size standards, for the
[[Page 43030]]
purpose of cable rate regulation. Under the Commission's rules, a
``small cable company'' is one serving 400,000 or fewer subscribers,
nationwide.\172\ Industry data indicate that at the end of June 2012,
1,141 cable companies were in operation.\173\ Of this total, all but
ten cable operators were small under this size standard. In addition,
under the Commission's rules, a ``small system'' is a cable system
serving 15,000 or fewer subscribers.\174\ Industry data indicate that
of 4,945 systems nationwide, 4,380 systems have fewer than 20,000.\175\
Thus, under this second size standard, most cable systems are small and
may be affected by the rules adopted.
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\172\ See 47 CFR 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, 60 FR 35854, 35855,
para. 7 (July 12, 1995).
\173\ NCTA, Industry Data, Number of Cable Operating Companies.
See https://www.ncta.com/Statistics.aspx.
\174\ See 47 CFR 76.901(c).
\175\ The number of active, registered cable systems comes from
the Commission's Cable Operations Licensing System (COALS) database
on August 28, 2013.
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18. All Other Telecommunications. ``All Other Telecommunications''
is defined as follows: This U.S. industry is comprised of
establishments that are primarily engaged in providing specialized
telecommunications services, such as satellite tracking, communications
telemetry, and radar station operation. This industry also includes
establishments primarily engaged in providing satellite terminal
stations and associated facilities connected with one or more
terrestrial systems and capable of transmitting telecommunications to,
and receiving telecommunications from, satellite systems.
Establishments providing Internet services or voice over Internet
protocol (VoIP) services via client-supplied telecommunications
connections are also included in this industry.\176\ The SBA has
developed a small business size standard for ``All Other
Telecommunications,'' which consists of all such firms with gross
annual receipts of $32.5 million or less.\177\ For this category,
census data for 2007 show that there were 2,383 firms that operated for
the entire year. Of these firms, a total of 2,346 had gross annual
receipts of less than $25 million.\178\ Thus, a majority of ``All Other
Telecommunications'' firms potentially affected by the rules adopted
can be considered small.
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\176\ https://www.census.gov/cgi-bin/ssssd/naics/naicsrch.
\177\ 13 CFR 121.201; NAICS Code 517919.
\178\ https://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ECN_2007_US_51SSSZ5&prodType=table.
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D. Description of Projected Reporting, Recordkeeping and Other
Compliance Requirements
19. This Report and Order does not adopt any new reporting,
recordkeeping, or other compliance requirements, other than the
requirement that DBS providers pay regulatory fees based on Media
Bureau FTEs, as a subcategory of the cable television operators and
IPTV category. These two companies are already subject to our
regulatory fee requirements.
E. Steps Taken To Minimize Significant Economic Impact on Small
Entities, and Significant Alternatives Considered
20. 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.\179\
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\179\ 5 U.S.C. 603(c)(1)-(c)(4).
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21. This Report and Order does not adopt any new reporting
requirements. Therefore no adverse economic impact on small entities
will be sustained based on reporting requirements. There will be a
regulatory fee increase on DBS providers, but these companies are not
small entities. We are also advising SMS/800, Inc. to provide
information to Responsible Organizations, or RespOrgs, to ensure that
they comply with their new previously adopted regulatory fee
requirements. These entities may be small entities; however, the
regulatory fee per toll free number is very small and could easily be
paid and then passed on to the subscriber if the number is in use, in
which case compliance would not be an issue. (We also note that there
is a previously adopted de minimis threshold of $500, per year.) If the
toll free number is not used by a subscriber, the RespOrg can either
choose to pay the regulatory fee or return the toll free number to the
800/SMS, Inc. database. The Commission expends resources to address
toll free issues, and so parties should either be responsible for the
payment of the resources used or the toll free numbers should be
returned for others to use.
22. 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. In addition,
the Commission's rules provide a process by which regulatory fee payors
may seek waivers or other relief on the basis of financial hardship.
See 47 CFR 1.1166.
F. Federal Rules That May Duplicate, Overlap, or Conflict
23. None.
V. Ordering Clauses
24. 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 Report and Order and Order
is hereby adopted.
25. It is further ordered that Part 1 of the Commission's rules are
amended as set forth in paragraph 32 and in the rule change section of
this document, effective upon publication in the Federal Register.
26. It is further ordered that the Commission's Consumer and
Governmental Affairs Bureau, Reference Information Center, shall send a
copy of this Report and Order and Order, including the Final Regulatory
Flexibility Analysis, to the Chief Counsel for Advocacy of the U.S.
Small Business Administration.
List of Subjects in 47 CFR Part 1
Administrative practice and procedure.
Federal Communications Commission.
Marlene H. Dortch,
Secretary.
Rule Changes
For the reasons discussed in the preamble, the Federal
Communications Commission amends 47 CFR part 1 as follows:
PART 1--PRACTICE AND PROCEDURE
0
1. The authority citation for part 1 continues to read as follows:
Authority: 15 U.S.C. 79 et seq., 47 U.S.C. 151, 154(i), 154(j),
155, 157, 225, 303, and 309.
Subpart O--Collection of Claims Owed the United States
0
2. Revise Sec. 1.1911(d) to read as follows:
[[Page 43031]]
Sec. 1.1911 Demand for payment.
* * * * *
(d) The Commission may, as circumstances and the nature of the debt
permit, include in demand letters such items as the Commission's
willingness to discuss alternative methods of payment; its policies
with respect to the use of credit bureaus, debt collection centers, and
collection agencies; the Commission's remedies to enforce payment of
the debt (including assessment of interest, administrative costs and
penalties, administrative garnishment, the use of collection agencies,
Federal salary offset, tax refund offset, administrative offset, and
litigation); the requirement that any debt delinquent for more than 120
days be transferred to the Department of the Treasury for collection;
and, depending on applicable statutory authority, the debtor's
entitlement to consideration of a waiver. Where applicable, the debtor
will be provided with a period of time (normally not more than 15
calendar days) from the date of the demand in which to exercise the
opportunity to request a review.
* * * * *
0
3. Revise Sec. 1.1912(b)(1) to read as follows:
Sec. 1.1912 Collection by administrative offset.
* * * * *
(b) Mandatory centralized administrative offset. (1) The Commission
is required to refer past due, legally enforceable nontax debts which
are over 120 days delinquent to the Treasury for collection by
centralized administrative offset. Debts which are less than 120 days
delinquent also may be referred to the Treasury for this purpose. See
FCCS for debt certification requirements.
* * * * *
0
4. Revise Sec. 1.1917(c) to read as follows:
Sec. 1.1917 Referrals to the Department of Justice and transfer of
delinquent debt to the Secretary of Treasury.
* * * * *
(c) All non-tax debts of claims owed to the Commission that have
been delinquent for a period of 120 days shall be transferred to the
Secretary of the Treasury. Debts which are less than 120 days
delinquent may also be referred to the Treasury. Upon such transfer the
Secretary of the Treasury shall take appropriate action to collect or
terminate collection actions on the debt or claim. A debt is past-due
if it has not been paid by the date specified in the Commission's
initial written demand for payment or applicable agreement or
instrument (including a post-delinquency payment agreement) unless
other satisfactory payment arrangements have been made.
[FR Doc. 2015-17288 Filed 7-20-15; 8:45 am]
BILLING CODE 6712-01-P
