Proposed Scope of NTIA's Authority Regarding FirstNet Fees, 77592-77598 [2015-31516]

Download as PDF 77592 Federal Register / Vol. 80, No. 240 / Tuesday, December 15, 2015 / Proposed Rules asabaliauskas on DSK5VPTVN1PROD with PROPOSALS EPA has already completed the first round of allocations of 2015 NUSA allowances for all four CSAPR trading programs, as well as the second round of 2015 NUSA allocations to units subject to the CSAPR Ozone Season Trading Program, as announced in notices previously published in the Federal Register.3 The first and secondround NUSA allocation process was discussed in those previous notices. This notice of availability concerns the second round of NUSA allowance allocations for the CSAPR NOX Annual, SO2 Group 1, and SO2 Group 2 Trading Programs for the 2015 control period.4 The units eligible to receive secondround NUSA allocations for the CSAPR NOX Annual, SO2 Group 1, and SO2 Group 2 Trading Programs are defined in §§ 97.411(b)(1)(iii) and 97.412(a)(9)(i), 97.611(b)(1)(iii) and 97.612(a)(9)(i), and 97.711(b)(1)(iii) and 97.712(a)(9)(i), respectively. Generally, eligible units include any CSAPR-affected unit that commenced commercial operation between January 1 of the year before the control period in question and November 30 of the year of the control period in question. In the case of the 2015 control period, an eligible unit therefore must have commenced commercial operation between January 1, 2014 and November 30, 2015 (inclusive). The total quantity of allowances to be allocated through the 2015 NUSA allowance allocation process for each state and emissions trading program—in the two rounds of the allocation process combined—is generally the state’s 2015 emissions budget less the sum of (1) the total of the 2015 CSAPR FIP allowance allocations to existing units and (2) the amount of the 2015 Indian country NUSA, if any.5 The amounts of CSAPR NOX Annual, SO2 Group 1, and SO2 Group 2 NUSA allowances may be increased in certain circumstances as set forth in §§ 97.412(a)(2), 97.612(a)(2), and 97.712(a)(2), respectively. Second-round NUSA allocations for a given state, trading program, and control period are made only if the NUSA contains allowances after completion of the first-round allocations. The amounts of second-round allocations of CSAPR NOX Annual, SO2 3 80 FR 30988 (June 1, 2015); 80 FR 44882 (July 28, 2015); 80 FR 55061 (September 14, 2015); 80 FR 69883 (November 12, 2015). 4 At this time, EPA is not aware of any unit eligible for a second-round allocation from any Indian country NUSA. 5 The quantities of allowances to be allocated through the NUSA allowance allocation process may differ slightly from the NUSA amounts set forth in §§ 97.410(a), 97.510(a), 97.610(a), and 97.710(a) because of rounding in the spreadsheet of CSAPR FIP allowance allocations to existing units. VerDate Sep<11>2014 16:48 Dec 14, 2015 Jkt 238001 Group 1, and SO2 Group 2 allowances to eligible new units from each NUSA are calculated according to the procedures set forth in §§ 97.412(a)(9), (10) and (12), 97.612(a)(9), (10), and (12), and 97.712(a)(9), (10), and (12), respectively. Generally, the procedures call for each eligible unit to receive a second-round 2015 NUSA allocation equal to the positive difference, if any, between its emissions during the 2015 annual control periods (i.e., January 1, 2015 through December 31, 2015) as reported under 40 CFR part 75 and any first-round allocation the unit received, unless the total of such allocations to all eligible units would exceed the amount of allowances in the NUSA, in which case the allocations are reduced on a pro-rata basis. Any allowances remaining in the CSAPR NOX Annual, SO2 Group 1, or SO2 Group 2 NUSA for a given state and control period after the second round of NUSA allocations to new units will be allocated to the existing units in the state according to the procedures set forth in §§ 97.412(a)(10) and (12), 97.612(a)(10) and (12), and 97.712(a)(10) and (12), respectively. EPA notes that an allocation or lack of allocation of allowances to a given EGU does not constitute a determination that CSAPR does or does not apply to the EGU. EPA also notes that allocations are subject to potential correction if a unit to which NUSA allowances have been allocated for a given control period is not actually an affected unit as of the start of that control period.6 The preliminary lists of units eligible for second-round 2015 NUSA allowance allocations for the three CSAPR annual trading programs are set forth in Excel spreadsheets titled ‘‘CSAPR_NUSA_ 2015_NOx_Annual_2nd_Round_ Prelim_Data,’’ ‘‘CSAPR_NUSA_2015_ SO2_Group_1_2nd_Round_Prelim_ Data,’’ and ‘‘CSAPR_NUSA_2015_SO2_ Group_2_2nd_Round_Prelim_Data’’ available on EPA’s Web site at http:// www.epa.gov/crossstaterule/ actions.html. Each spreadsheet contains a separate worksheet for each state covered by that program showing each unit preliminarily identified as eligible for a second-round NUSA allocation. Each state worksheet also contains a summary showing (1) the quantity of allowances initially available in that state’s 2015 NUSA, (2) the sum of the 2015 NUSA allowance allocations that were made in the first-round to new units in that state (if any), and (3) the quantity of allowances in the 2015 NUSA available for distribution in second-round allocations to new units 6 See PO 00000 40 CFR 97.411(c), 97.611(c), and 97.711(c). Frm 00004 Fmt 4702 Sfmt 4702 (or ultimately for allocation to existing units). Objections should be strictly limited to whether EPA has correctly identified the new units eligible for second-round 2015 NUSA allocations of CSAPR NOX Annual, SO2 Group 1, and SO2 Group 2 allowances according to the criteria described above and should be emailed to the address identified in ADDRESSES. Objections must include: (1) Precise identification of the specific data the commenter believes are inaccurate, (2) new proposed data upon which the commenter believes EPA should rely instead, and (3) the reasons why EPA should rely on the commenter’s proposed data and not the data referenced in this notice of availability. Authority: 40 CFR 97.411(b), 97.611(b), and 97.711(b). Dated: December 7, 2015. Reid P. Harvey, Director, Clean Air Markets Division, Office of Atmospheric Programs, Office of Air and Radiation. [FR Doc. 2015–31461 Filed 12–14–15; 8:45 am] BILLING CODE 6560–50–P DEPARTMENT OF COMMERCE National Telecommunications and Information Administration 47 CFR Chapter V [Docket Number: 151209999–5999–01] RIN 0660–AA30 Proposed Scope of NTIA’s Authority Regarding FirstNet Fees National Telecommunications and Information Administration, U.S. Department of Commerce. ACTION: Notice of proposed rulemaking. AGENCY: The National Telecommunications and Information Administration (NTIA) publishes this notice of proposed rulemaking to request public comment as it develops rules related to its review and approval of fees imposed by the First Responder Network Authority (FirstNet) as authorized by the Middle Class Tax Relief and Job Creation Act of 2012 (the Act). DATES: Submit comments on or before January 14, 2016. ADDRESSES: The public is invited to submit written comments to this proposed rule. Written comments may be submitted electronically through www.regulations.gov or by mail (to Office of Public Safety Communications; National Telecommunications and SUMMARY: E:\FR\FM\15DEP1.SGM 15DEP1 Federal Register / Vol. 80, No. 240 / Tuesday, December 15, 2015 / Proposed Rules Information Administration; U.S. Department of Commerce; 1401 Constitution Avenue NW., Washington, DC 20230.). Comments received related to this proposed rule will be made a part of the public record and will be posted to www.regulations.gov without change. Comments should be machine readable and should not be copy-protected. Comments should include the name of the person or organization filing the comment as well as a page number on each page of the submission. All personally identifiable information (e.g., name, address) voluntarily submitted by the commenter may be publicly accessible. Do not submit confidential business information or otherwise sensitive or protected information. FOR FURTHER INFORMATION CONTACT: Patrick Sullivan; Office of Public Safety Communications; National Telecommunications and Information Administration; U.S. Department of Commerce; 1401 Constitution Avenue NW., Washington, DC 20230; psullivan@ntia.doc.gov; (202) 482–5948. SUPPLEMENTARY INFORMATION: Table of Contents asabaliauskas on DSK5VPTVN1PROD with PROPOSALS I. Introduction, Summary of Proposed Rules II. Background: Relevant Statutory Provisions A. FirstNet-Assessed Fees Must Ensure Self-Funding and be Approved by NTIA. B. FirstNet’s Finances are Subject to Broader, Independent Review. III. NTIA’s Annual Fee Review Focuses on Whether FirstNet Fees and Other Income, In Aggregate, Are Sufficient, and Do Not Exceed the Amount Necessary, to Recoup FirstNet’s Total Expense A. Standard of NTIA Fee Review and Approval. B. NTIA’s Fee Review and Approval Process Does Not Assess the Reasonableness of a Proposed Fee. IV. Methodology of NTIA Fee Review and Approval Process A. Focus of NTIA Fee Review Methodology. B. NTIA’s Fee Review and Approval Process Defers to FirstNet on Necessary Reserves. V. FirstNet-Proposed Fees Subject to NTIA Review Under Section 6208 Must be Addressed Upon NTIA Disapproval A. Fees Subject to NTIA Review and FirstNet Reconsideration Upon NTIA Disapproval. B. Income Other Than Fees is Not Subject to NTIA Fee Review. VI. Ex Parte Communication I. Introduction, Summary of Proposed Rules The Middle Class Tax Relief and Job Creation Act of 2012 (Pub. L. 112–96, Title VI, 126 Stat. 256 (codified at 47 U.S.C. 1401 et seq.)) (Act) established the First Responder Network Authority (FirstNet) as an independent authority within the National VerDate Sep<11>2014 16:48 Dec 14, 2015 Jkt 238001 Telecommunications and Information Administration (NTIA).1 Congress mandated FirstNet ensure the building, deployment, and operation of an interoperable nationwide public safety broadband network (Network).2 In order to meet this critical directive and provide affordable, reliable, and sustainable broadband services for first responders across the United States, FirstNet must operate as a business enterprise. Today, public safety entities procure broadband services from numerous commercial service providers. When it enters the market, FirstNet will start with no market share and will have to compete for customers by distinguishing its product in terms of features, price, and reliability from products offered by commercial providers. To be successful, FirstNet will need to employ business strategies with flexibility and agility commonplace in the private sector. This document proposes rules that will enable NTIA to execute its duty to review specific fees proposed by FirstNet in a manner compatible with FirstNet’s need to operate as a business in a competitive marketplace. NTIA proposes to execute its statutory fee review duties to afford FirstNet as much flexibility as possible to establish its business and budgetary goals and to adjust those goals as necessary to respond to the day-to-day realities of the broader competitive marketplace in which FirstNet must operate. Ultimately, NTIA intends to implement a fee review process that allows FirstNet to respond to changing market conditions and the demands of its vital and dynamic customer base: First responders. The Act requires FirstNet to be permanently self-funding and authorizes it to assess and collect certain types of fees to assure its sustainability. The Act requires that the total amount of FirstNet’s annual fees must be sufficient to recoup FirstNet’s total expenses, but such fees must not exceed the amount necessary to carry out its duties under the Act.3 As part of FirstNet’s self-funding obligations, the Act directs NTIA to review these fees on an annual basis; they may only be assessed if approved by NTIA.4 This notice of proposed rulemaking describes NTIA’s overarching scope, boundaries, and guidelines for NTIA’s fee review and approval process as 1 See 47 U.S.C. 1424(a). 47 U.S.C. 1426(b)(1) (stating FirstNet shall ‘‘. . . take all actions necessary to ensure the building, deployment, and operation of the nationwide public safety broadband network . . .’’). 3 See 47 U.S.C. 1428(b). 4 See 47 U.S.C. 1428(c). 2 See PO 00000 Frm 00005 Fmt 4702 Sfmt 4702 77593 required by law. Section II of this notice of proposed rulemaking details relevant statutory provisions and makes clear that, while NTIA has a distinct role through the fee review and approval process to ensure that FirstNet is selffunded, NTIA’s role is a relatively limited part of broader statutory provisions designed to monitor FirstNet’s financial condition and operational status. Section III defines the scope of NTIA’s proposed fee review and approval process. NTIA has determined that this process is for a particular and limited purpose: it must examine only whether the proposed fees of another federal entity—FirstNet—as set forth under Section 6208 of the Act, are, in aggregate and in combination with any FirstNet non-fee-based income, sufficient, but not in excess of, the projected funds that FirstNet needs to recoup the total expenses required to carry out its statutory obligations in a given year. NTIA acknowledges that, as authorized by the Act, FirstNet might receive income which is separate and distinct from the fee categories defined in Section 6208. NTIA recognizes that such income will impact NTIA’s determination whether FirstNet’s proposed fees, in aggregate and in combination with such non-fee-based income, will meet but not exceed the funds it needs on an annual basis. However, NTIA proposes that the Act affords NTIA no authority to review or approve as a ‘‘fee’’ any other form of income FirstNet may receive beyond those fees listed in Section 6208(a). In Section IV, NTIA proposes a methodology for its fee review that must by law occur annually and prior to FirstNet’s assessment of fees. Because NTIA’s fee review process is for particular and limited purposes focusing on the financial sustainability of another federal entity within the Department of Commerce, NTIA will include in its review a review of FirstNet’s projected expenses as set forth in its approved budgets as well as a review of FirstNet’s prior-year actual expenses and revenues to facilitate FirstNet’s compliance with Section 6208(b). To that end, NTIA proposes to utilize FirstNet’s regular budget process and financial statements. NTIA also proposes to defer to FirstNet on any need for reserves, working capital, or similar fund categories. NTIA, however, will take such fund categories into consideration as part of its determination of whether the total proposed fees under Section 6208(b) meet, but do not exceed, FirstNet’s total expenses. E:\FR\FM\15DEP1.SGM 15DEP1 77594 Federal Register / Vol. 80, No. 240 / Tuesday, December 15, 2015 / Proposed Rules In Section V, NTIA discusses the fees that NTIA has specific jurisdiction to review; if, in its review of aggregate revenues and costs, it determines that FirstNet has not satisfied the legal standard, FirstNet must adjust its fees or otherwise make budgetary changes to ensure that the standard is met. Specifically, NTIA proposes to define the term ‘‘fee,’’ for purposes of its statutory obligations under Section 6208(c) of the Act, to mean FirstNet’s direct collection of money that is generated from the three categories established in Section 6208(a) of the Act: (1) Network user fees; (2) lease fees pursuant to a covered leasing agreement (CLA); and (3) fees from entities seeking access to or use of any network equipment or infrastructure constructed or otherwise owned by FirstNet.5 Under this proposed rule, NTIA can direct FirstNet to address only those proposed fees that fall into one of these three categories. Further, NTIA proposes that it will not evaluate the reasonableness, or similar subjective attributes, of the specific fees assessed by FirstNet or its prospective partner or partners as contemplated in the Act. Specific NTIA rules are proposed in new 47 CFR Chapter V; Subchapter A will be utilized for NTIA rules that relate to FirstNet, and Subchapter B will be reserved for rules promulgated by FirstNet itself. We seek comment on these preliminary proposals. We also look forward to FirstNet’s progress in its procurement process, which may provide additional information relevant to NTIA’s duties under Section 6208(c). With such information from stakeholders and FirstNet, NTIA will be better informed to solidify the scope of its fee review and approval process as appropriate. asabaliauskas on DSK5VPTVN1PROD with PROPOSALS II. Background: Relevant Statutory Provisions A. FirstNet-Assessed Fees Must Ensure Self-Funding and Be Approved by NTIA The Act established FirstNet as an independent authority within NTIA.6 The Act authorizes FirstNet to take all actions necessary to ensure the building, deployment, and operation of the Network.7 To achieve this significant and unprecedented task, FirstNet must operate in many respects as a private sector business enterprise.8 5 See 47 U.S.C. 1428(a). 47 U.S.C. 1424(a). 7 See 47 U.S.C. 1426(b). 8 To that end, the Act set forth several key provisions establishing FirstNet as a business enterprise. For example, the Act requires the creation of the FirstNet Board, which has the 6 See VerDate Sep<11>2014 16:48 Dec 14, 2015 Jkt 238001 FirstNet’s authority to operate as a business can and should further its ability to meet the Act’s mandate that it become a self-sustaining enterprise. Section 6208 of the Act makes clear that FirstNet must establish permanent selffunding and is authorized to collect fees for specified uses of the Network or its components in furtherance of that obligation. The Act established specific parameters for FirstNet’s fee assessments described in Section 6208(a) to drive sustainability and continual reinvestment of FirstNet revenues into the Network. Section 6208(b), entitled, ‘‘Establishment of Fee Amounts; Permanent Self-Funding,’’ requires that the total amount of the fees assessed under Section 6208(c) for each fiscal year shall be sufficient, but cannot exceed, the amount necessary to recoup the total expenses of FirstNet as it carries out its duties under the Act.9 Moreover, FirstNet must reinvest amounts received from the assessment of fees under Section 6208 for constructing, maintaining, operating, or improving the Network.10 Specific to FirstNet’s authority to assess and collect these fees, Section 6208(c) requires that NTIA review such fees ‘‘on an annual basis, and such fees may only be assessed if approved by . . . NTIA.’’ 11 Additionally, the Act makes clear that FirstNet should consider public-private partnerships, affording it additional authority to creatively support the provision of a self-funded broadband network for use by public safety entities.12 Such partnerships might fiduciary and operational functions assigned to boards of corporations. See 47 U.S.C. 1424(b). Furthermore, Board members appointed by the Secretary of Commerce must include individuals with various types of business experience, including expertise in building, deploying, and operating commercial telecommunications networks, and in financing and funding telecommunications networks. See id. FirstNet may only act as authorized by the Board to execute any powers granted by the Act to FirstNet, spend funds, or take other actions deemed necessary, appropriate, or advisable to accomplish the purposes of the Act. See 47 U.S.C. 1426(a)(1); see also 47 U.S.C. 1426(a)(5). As a business enterprise, FirstNet may contract with individuals; private companies; organizations; institutions; and Federal, State, regional, and local agencies. See 47 U.S.C. 1426(a)(3). The Act allows FirstNet to engage in other business activities, including selecting agents, consultants, or experts and hiring a program manager to carry out key aspects of deploying the NPSBN. See 47 U.S.C. 1425(b). 9 See 47 U.S.C. 1428(b). 10 See 47 U.S.C. 1428(d). 11 47 U.S.C. 1428(c). 12 See, e.g., 47 U.S.C. 1428(a) (describing publicprivate arrangements to construct, manage, and operate the nationwide public safety broadband network between FirstNet and a secondary user); see also 47 U.S.C. 1426(b)(3) (requiring that FirstNet requests for proposals, to the maximum extent economically feasible, ‘‘include partnerships with PO 00000 Frm 00006 Fmt 4702 Sfmt 4702 result in FirstNet’s collection of income that does not fall within the fees specified in Section 6208(a).13 B. FirstNet’s Finances are Subject to Broader, Independent Review NTIA’s approach in this proposed rule reflects the scope of its fees review authority in the context of other supervision of FirstNet’s finances and operations, which taken together, ensure a high degree of oversight over FirstNet’s finances under the Act. The Act sets forth multiple methods of oversight of FirstNet well beyond the limited review and approval of fees required of NTIA under Section 6208(c). For example, FirstNet is subject to an independent financial audit. Section 6209 of the Act requires that the Secretary of Commerce engage an independent auditor to conduct an annual audit of all of FirstNet’s commercial corporate transactions which the auditor will submit to Congress, the President, and FirstNet.14 In addition, the Act requires an annual, ‘‘comprehensive and detailed report of the operations, activities, financial condition, and accomplishments of [FirstNet],’’ to be submitted to Congress along with ‘‘recommendations or proposals for legislative or administrative action as [FirstNet] deems appropriate.’’ 15 Furthermore, FirstNet must comply on a day-to-day basis with all other applicable federal financial laws and regulations. In light of these broader oversight provisions, NTIA’s narrow scoping of its fee review authority is appropriate. III. NTIA’s Annual Fee Review Focuses on Whether FirstNet Fees and Other Income, in Aggregate, Are Sufficient, and Do Not Exceed the Amount Necessary, To Recoup FirstNet’s Total Expenses A. Standard of NTIA Fee Review and Approval The Act does not provide a specific standard of review for NTIA’s annual fee review and approval process under Section 6208(c).16 However, examination of other provisions in Section 6208 and the Act at large inform NTIA’s proposed approach to FirstNet existing commercial mobile providers to utilize cost- effective opportunities to speed deployment in rural areas’’). 13 See, e.g., § 1426(a)(3) (referencing ‘‘grants and funds from . . . individuals, private companies, organizations, institutions, and Federal, State, regional, and local agencies’’); § 1426(a)(4) (referencing ‘‘gifts, donations, and bequests of property, both real and personal’’). 14 See 47 U.S.C. 1429. 15 47 U.S.C. 1430. 16 See 47 U.S.C. 1428(c). E:\FR\FM\15DEP1.SGM 15DEP1 Federal Register / Vol. 80, No. 240 / Tuesday, December 15, 2015 / Proposed Rules fee review. FirstNet has a duty under Section 6208(b) to ensure that, during a given fiscal year, the fees it assesses are sufficient, and shall not exceed the amount necessary, to recoup the ‘‘total expenses’’ associated with carrying out its duties as specified under the Act.17 Given this overarching directive in Section 6208(b), which immediately precedes the Act’s assignation of fee review to NTIA in Section 6208(c), NTIA proposes that the Act’s purpose for the fee review is solely to support FirstNet’s obligation under Section 6208(b) to be self-funding. Thus, NTIA intends to base its decisions on FirstNet’s proposed fees by only examining whether the fees are, in aggregate and combined with other nonfee-based income, sufficient, but not in excess, of the projected funds FirstNet needs to carry out its statutory obligations in a given fiscal year. In this way, NTIA’s review and approval of FirstNet-proposed fees under Section 6208 will exclusively focus on FirstNet’s projected income and expenses to further the self-funding requirements and limitations of Section 6208(b). We seek comment on this proposed approach. asabaliauskas on DSK5VPTVN1PROD with PROPOSALS B. NTIA’s Fee Review and Approval Process Does Not Assess the Reasonableness of a Proposed Fee The scope of review of a fee is established by the statute.18 As a result, we propose that NTIA’s fee review is scoped to self-sustainability and does not include review of the reasonableness of any fee assessed by FirstNet or its prospective partner or partners as contemplated in the Act. The wording of the Act itself does not direct NTIA to perform a reasonableness review. Section 6208(b), entitled, ‘‘Establishment Of Fee Amounts; Permanent Self-Funding,’’ requires that the total amount of the fees assessed by FirstNet for each fiscal year must be sufficient, but cannot exceed, the amount necessary to recoup the total expenses of FirstNet as it carries out its duties under the Act.19 NTIA’s mandate to review and approve FirstNet fees directly follows this fee structure requirement in Section 6208(c).20 The Act provides no other direction regarding fee review, but the structure of the statute clearly indicates congressional intent to ensure that the 17 See 47 U.S.C. 1428(b). Principles of Federal Appropriations Law, Volume III, Third Edition, GAO, pp 12–140–12– 181. GAO 08–978 SP (Washington, DC, September 2008). 19 See 47 U.S.C. 1428(b). 20 See 47 U.S.C. 1428(c). 18 See VerDate Sep<11>2014 16:48 Dec 14, 2015 Jkt 238001 assessed fees drive a self-funded network. A review of other provisions of Title 47 demonstrates that when Congress intends for rates to be subject to a review for ‘‘reasonableness’’ or other subjective standards, it states this intention explicitly. For example, Section 201 of the Communications Act directs the Federal Communications Commission (FCC) to determine whether the charges of telecommunications carriers are ‘‘just and reasonable.’’ 21 Similarly, Section 224 of the Communications Act directs the FCC to regulate the rates, terms, and conditions of pole attachments to ensure they are ‘‘just and reasonable.’’ 22 Here, with respect to FirstNet’s assessment of fees under Section 6208, and NTIA’s review and approval of such fees, the Act established no such ‘‘just and reasonable’’ standard. Moreover, a reasonableness review of FirstNet fees is unnecessary as a matter of policy. The Act does not mandate or require any public safety entity to purchase services from FirstNet. FirstNet must compete for subscribers by offering a compelling value proposition to prospective public safety customers. Public safety users themselves will determine whether FirstNet’s proposed user fees are reasonable in comparison to the fees they are offered by competing providers. Thus, NTIA proposes that it will not assess whether individual or total fees in any given category described in Section 6208(a) are reasonable, proportionate, or otherwise subjectively appropriate in light of individual or total fees in that category, or any other category of fees listed in Section 6208(a). With the proposed scope of its fee review, NTIA meets the intent of the self-funding provisions, but does not import ‘‘just and reasonable’’ review parameters that Congress clearly could have, but did not, include in the statute. We seek comment on these preliminary proposals. 21 See 47 U.S.C 201 (stating that, for common carrier services, ‘‘[a]ll charges . . . for and in connection with such communication service, shall be just and reasonable, and any such charge, practice, classification, or regulation that is unjust or unreasonable is hereby declared to be unlawful.’’). 22 See 47 U.S.C 224 (b)(1) (stating that ‘‘the Commission shall regulate the rates, terms, and conditions for pole attachments to provide that such rates, terms, and conditions are just and reasonable, and shall adopt procedures necessary and appropriate to hear and resolve complaints concerning such rates, terms, and conditions.’’) PO 00000 Frm 00007 Fmt 4702 Sfmt 4702 77595 IV. Methodology of NTIA Fee Review and Approval Process A. Focus of NTIA Fee Review Methodology Based on the preliminary conclusions above, NTIA proposes to base its approval of fees upon a determination of whether the proposed fees, in aggregate, when combined with any projected nonfee-based income that FirstNet receives, meet but do not exceed FirstNet’s anticipated total expenses associated with carrying out its duties as specified under the Act in a given year. As required by the Act, NTIA will conduct its fee review and approval process on an annual basis. Further, NTIA’s proposed fee review and approval process will occur before a fee is assessed as required by the Act, and NTIA expects that FirstNet will propose such fees to NTIA in writing. Because FirstNet must compete in a broader marketplace for the opportunity to provide broadband service to public safety entities, it will need the flexibility over the course of a fiscal year to adjust specific fees it wishes to assess pursuant to Section 6208(a). Thus, to empower FirstNet with the flexibility needed to compete in the marketplace, NTIA proposes that, as part of its annual fee review, it will also review FirstNet’s actual fees and expenses from the previous four fiscal quarters. This process will afford FirstNet the opportunity to describe any significant discrepancies between projected and actual expenses and revenue of that previous fiscal year and detail how its projected fees and revenues for the upcoming fiscal year have addressed these discrepancies. In doing so, FirstNet will have an opportunity on an annual basis to ensure that its duty under Section 6208(b) is met. To determine FirstNet’s anticipated expenses, among the specific costs areas that NTIA may consider are: (1) Salaries and Benefits; (2) Travel; (3) Services: Federal Sources; (4) Services: Non-Federal Sources; (5) Facilities Rental; (6) Supplies, Materials, and Printing; (7) Equipment; and (8) Other expenses or obligations incurred for future contract award, capital reserves, or other permitted expenses or obligations. NTIA anticipates deferring to FirstNet to determine the reasonableness of projected obligations in the aforementioned or other categories. Throughout the fee review and approval process, NTIA anticipates utilizing the budget documents and financial statements produced in the normal course of FirstNet’s business. NTIA might also utilize FirstNet’s E:\FR\FM\15DEP1.SGM 15DEP1 77596 Federal Register / Vol. 80, No. 240 / Tuesday, December 15, 2015 / Proposed Rules asabaliauskas on DSK5VPTVN1PROD with PROPOSALS annual budget reports as approved by the FirstNet Board and submitted as part of the President’s Budget and FirstNet’s mandated annual report to Congress. Therefore, NTIA proposes that it will make, on an annual basis, one of three determinations with regard to proposed fees: (1) FirstNet’s proposed fees, in aggregate, when combined with any projected non-fee-based income to be received by FirstNet, meet but do not exceed FirstNet’s projected total expenses; (2) FirstNet’s proposed fees, in aggregate, when combined with any projected non-fee-based income to be received by FirstNet, do not meet FirstNet’s projected total expenses; or (3) FirstNet’s proposed fees, in aggregate, when combined with any projected non-fee-based income to be received by FirstNet, exceed FirstNet’s projected total expenses. Upon making any of these determinations, NTIA will communicate its determination in writing to FirstNet. Should NTIA make the second or third determination listed above, NTIA will not approve FirstNet’s proposed fees, and FirstNet may not assess them. NTIA proposes that it will accept any revised proposed fees or FirstNet approved revised budgets when provided by FirstNet in writing and evaluate them consistent with the scope and methodology proposed above. We seek comment on this proposed approach to NTIA’s fee review and approval process. We also seek comment on alternative methodologies that will further our fee review and approval process consistent with the Act’s directives. B. NTIA’s Fee Review and Approval Process Defers to FirstNet on Necessary Reserves NTIA proposes that it should defer to FirstNet, in the context of its budgetary planning process, regarding the use and retention of reserves or working capital funds. By doing so, NTIA will not, in its fee review and approval process, assess whether or what level of funds FirstNet should maintain in reserves, capital accounts, or other funding categories. FirstNet’s routine budget, auditing, and accounting processes will presumably determine the need for such capital reserve funds. NTIA plans to defer to FirstNet’s determination of need for such funds through these processes. We seek comment on this proposed approach to NTIA’s fee review and approval process. Moreover, NTIA proposes that, in its fee review and approval process, it will take into consideration reserve funds at the levels designated in FirstNet’s budget, to determine whether FirstNet’s proposed fees meet but not exceed VerDate Sep<11>2014 17:18 Dec 14, 2015 Jkt 238001 FirstNet’s total expenses. In doing so, NTIA will deem such funds to be a part of FirstNet’s projected total expenses under Section 6208(b) of the Act. We seek comment on this proposal. V. FirstNet-Proposed Fees Subject to NTIA Review Under Section 6208 Must Be Addressed Upon NTIA Disapproval A. Fees Subject to NTIA Review and FirstNet Reconsideration Upon NTIA Disapproval The Act assigns a clear duty to NTIA under Section 6208: approve or disapprove the specific fees FirstNet aspires to assess under Section 6208. Under Section 6208(a) of the Act, FirstNet is authorized to assess and collect the following fees: 1. A Network User Fee: ‘‘A user or subscription fee from each entity, including any public safety entity or secondary user, that seeks access to or use of the [Network].’’ 23 2. Fees Pursuant to a Covered Leasing Agreement: ‘‘A fee from any entity that seeks to enter into a [CLA].’’ 24 3. Lease Fees Related to Network Equipment and Infrastructure: ‘‘A fee from any entity that seeks access to or use of any equipment or infrastructure, including antennas or towers, constructed or otherwise owned by the First Responder Network Authority resulting from a public-private arrangement to construct, manage, and operate the [Network]’’ 25 As a threshold matter for purposes of this proposed rule and NTIA’s duty under Section 6208 of the Act, the word ‘‘fee,’’ as used in Section 6208(c) of the Act, must be defined. By defining the fees NTIA is to review, NTIA identifies the specific fees FirstNet must address prior to NTIA approval in the event NTIA must disapprove FirstNetapproved fees under the standards set forth above. To implement its fee review obligations under the Act, NTIA must determine the meaning of the term ‘‘fee’’ as used in Section 6208. In the case of the Act, the three sets of fees, which FirstNet may assess, and which NTIA must review if assessed, are clearly defined within Section 6208(a). Thus, NTIA proposes that a ‘‘fee’’ that will be subject to its review and approval under 23 47 U.S.C. 1428(a)(1). U.S.C. 1428(a)(2)(A); See also 47 U.S.C. 1428(a)(2)(B) (stating that the Act defines a CLA as ‘‘a written agreement resulting from a public-private arrangement to construct, manage, and operate the nationwide public safety broadband network between the First Responder Network Authority and secondary user to permit—(i) access to network capacity on a secondary basis for non-public safety services; and (ii) the spectrum allocated to such entity to be used for commercial transmissions along the dark fiber of the long-haul network of such entity.’’). 25 47 U.S.C. 1428(a)(3). 24 47 PO 00000 Frm 00008 Fmt 4702 Sfmt 4702 Section 6208(c) is FirstNet’s collection of money that falls within the three categories in Section 6208(a): (1) Network user fees; (2) lease fees related to network capacity, pursuant to a covered leasing agreement; and (3) fees from entities seeking access to or use of any equipment or infrastructure constructed or otherwise owned by FirstNet.26 Given the clear language in Section 6208(a) defining the fees that FirstNet may assess, and the corresponding language in Section 6208(c) directing NTIA to review fees ‘‘assessed under [Section 6208],’’ NTIA proposes that its fee review authority, and FirstNet’s obligation to address fees upon NTIA disapproval of proposed fees, is scoped to the three abovereferenced categories. We seek comment on this preliminary proposal. B. Income Other Than Fees Is Not Subject to NTIA Fee Review As noted above, NTIA recognizes that, under the Act, FirstNet may receive income that is separate and distinct from the fees defined in Section 6208(a). Such income must be factored into NTIA’s determination of whether proposed fees, in aggregate, will meet but not exceed the funds needed by FirstNet on an annual basis. However, as the Act limits NTIA’s review and approval authority to ‘‘the fees assessed in [Section 6208],’’ NTIA proposes that the Act gives it no authority to review or approve as a ‘‘fee’’ any other form of income FirstNet might receive. NTIA proposes that non-fee-based income, emanating from arrangements allowed by statute, is not a ‘‘fee’’ under Section 6208(a). Furthermore, NTIA proposes that it will consider any non-fee income only as part of its determination of whether such income, when combined in aggregate with the fees defined in Section 6208(a), will be sufficient to recoup FirstNet’s total expenses, but not exceed the amount necessary, to carry out its statutory duties and responsibilities for the fiscal year involved. Moreover, NTIA proposes that it will not analyze the terms and conditions of any CLA, or any other agreement between FirstNet and another entity, beyond those specific terms and conditions which establish any fees that meet the three categories described in Section 6208(a). We seek comment on these preliminary proposals. VI. Ex Parte Communications Any non-public oral presentation to NTIA regarding the substance of this proposed rule will be considered an ex parte presentation, and the substance of 26 See E:\FR\FM\15DEP1.SGM 47 U.S.C. 1428(a). 15DEP1 Federal Register / Vol. 80, No. 240 / Tuesday, December 15, 2015 / Proposed Rules the meeting will be placed on the public record and become part of this docket. No later than two (2) business days after an oral presentation or meeting, an interested party must submit a memorandum to NTIA summarizing the substance of the communication. NTIA reserves the right to supplement the memorandum with additional information as necessary, or to request that the party making the filing do so, if NTIA believes that important information was omitted or characterized incorrectly. Any written presentation provided in support of the oral communication or meeting will also be placed on the public record and become part of this docket. Such ex parte communications must be submitted to this docket as provided in the ADDRESSES section above and clearly labeled as an ex parte presentation. Federal entities are not subject to these procedures. asabaliauskas on DSK5VPTVN1PROD with PROPOSALS Classification This rule has been determined to be not significant for purposes of Executive Order 12866. Regulatory Flexibility Act This proposed rulemaking, issued under the authority of the Act, will not have a significant economic impact on a substantial number of small entities as defined under the Regulatory Flexibility Act (RFA). If implemented, this rule would establish regulations, as required under the Act, for NTIA and FirstNet regarding the process by which NTIA reviews and approves or disapproves fees FirstNet proposes to assess. The RFA requires federal agencies to prepare an analysis of a rule’s impact on small entities whenever the agency is required to publish a notice of proposed rulemaking. However, a federal agency may certify, pursuant to 5 U.S.C. 605(b), that the action will not have a significant economic impact on a substantial number of small entities. The proposed regulations are for the particular and limited purpose of NTIA examining only whether the proposed fees of another federal entity— FirstNet—are, in aggregate and in combination with any FirstNet non-feebased income, sufficient, but not in excess of, the projected funds that FirstNet needs to recoup the total expenses required to carry out its statutory obligations in a given year. No external entities, including any small businesses, small organizations, or small governments, will experience any direct economic impacts from this proposed rule. The only potential effect on any external entities, large or small, would likely be positive, as NTIA’s proposed VerDate Sep<11>2014 16:48 Dec 14, 2015 Jkt 238001 rules will assist in ensuring that FirstNet, as required under the Act, will sustain a nationwide public safety broadband network that provides broadband communications to first responders. Because this action, if adopted, would directly affect only federal entities—NTIA and FirstNet— and not any small entities, the Department of Commerce has concluded that the action would not result in a significant economic impact on a substantial number of small entities. Thus, the Department of Commerce Chief Counsel for Regulations has certified to the Chief Counsel for Advocacy of the Small Business Administration that this rule will not have a significant impact on a substantial number of small entities. Therefore, an initial regulatory flexibility analysis is not required and has not been prepared. Executive Order 13132 It has been determined that this document does not contain policies with Federalism implications as that term is defined in Executive Order 13132. List of Subjects in 47 CFR Part 500 FirstNet, FirstNet Fees, Safety, Telecommunications. Dated: December 10, 2015. Lawrence E. Strickling, Assistant Secretary for Communications and Information. For the reasons set out in the preamble, the National Telecommunications and Information Administration proposes to add 47 CFR Chapter V to read as follows: CHAPTER V—THE FIRST RESPONDER NETWORK AUTHORITY (Parts 500–599) SUBCHAPTER A—NATIONAL TELECOMMUNICATIONS AND INFORMATION ADMINISTRATION REGULATIONS (Parts 500–549) PART 500—REVIEW AND APPROVAL OF FEES PROPOSED BY THE FIRST RESPONDER NETWORK AUTHORITY (FIRSTNET) Sec. 500.1 Purpose and scope. 500.2 General definitions. 500.3 NTIA duty to review FirstNet proposed fees. 500.4 Scope of NTIA review of FirstNet proposed fees. 500.5 Methodology of NTIA fee review and approval process. Authority: 47 U.S.C. 1401. § 500.1 Purpose and scope. Sections 500.2 through 500.5 implement 47 U.S.C. 1428(c) as codified pursuant to the Middle Class Tax Relief PO 00000 Frm 00009 Fmt 4702 Sfmt 4702 77597 and Job Creation Act of 2012 (Pub. L. 112–96, Title VI, 126 Stat. 256 (codified at 47 U.S.C. 1401 et seq.) (the ‘‘Act’’), which requires the National Telecommunications and Information Administration to annually review fees the First Responder Network Authority (FirstNet) proposes to assess. § 500.2 General definitions. Fee means FirstNet’s receipt of money from: (1) A Network User Fee; (2) Lease Fees Related To Network Capacity; or (3) Lease Fees Related To Network Equipment And Infrastructure, as those terms are defined under 47 U.S.C. 1428(a). FirstNet means the First Responder Network Authority. Fiscal Year means the 12-month accounting period for the federal government, which begins on 1 October of a given year and ends on 30 September of the subsequent year. Non-fee-based income received by FirstNet means FirstNet’s receipt of money from any source, transaction, entity, or any other means allowed under 47 U.S.C. 1401 et seq., other than those receipts described above in the definition of ‘‘fee.’’ NTIA means the National Telecommunications and Information Administration. NTIA’s fee review and approval process means the process by which NTIA executes its duties under 47 U.S.C. 1428(c). § 500.3 NTIA’s duty to review FirstNet proposed fees. As required under 47 U.S.C. 1428(c), NTIA shall exclusively review fees, which must be proposed by FirstNet in writing, through NTIA’s review and approval process conducted on an annual basis. § 500.4 Scope of NTIA review of FirstNet proposed fees. NTIA shall approve FirstNet proposed fees only if such fees, when combined with any non-fee-based income projected to be received by FirstNet, are sufficient, but do not exceed the amount necessary, to recoup FirstNet’s total expenses in carrying out its duties and responsibilities under 47 U.S.C. 1401 et seq. for the fiscal year involved. § 500.5 Methodology of NTIA fee review and approval process. (a) Fee review approach. To execute NTIA’s fee review and approval process, NTIA shall utilize FirstNet’s standard financial documentation, which may include but is not limited to: E:\FR\FM\15DEP1.SGM 15DEP1 asabaliauskas on DSK5VPTVN1PROD with PROPOSALS 77598 Federal Register / Vol. 80, No. 240 / Tuesday, December 15, 2015 / Proposed Rules (1) FirstNet’s budget documents produced in the normal course of its business; (2) FirstNet’s financial statements produced in the normal course of its business; (3) FirstNet’s annual budget reports submitted as part of the President’s Budget; and (4) FirstNet’s annual report to Congress. (b) Deference to FirstNet on necessary reserves. In executing NTIA’s fee review and approval process, NTIA shall defer to FirstNet with respect to its use and retention of reserve or working capital funds. NTIA shall consider any such designated funds to be a part of FirstNet’s total expenses in carrying out its duties and responsibilities under 47 U.S.C. 1401 et seq. for the fiscal year involved. (c) Determination of fee review: NTIA shall make one of the following determinations annually upon review of FirstNet’s proposed fees: (1) FirstNet’s proposed fees, in aggregate, when combined with any projected non-fee-based income to be received by FirstNet, meet but do not exceed FirstNet’s projected total expenses; (2) FirstNet’s proposed fees, in aggregate, when combined with any projected non-fee-based income to be received by FirstNet, do not meet FirstNet’s projected total expenses; or (3) FirstNet’s proposed fees, in aggregate, when combined with any projected non-fee-based income to be received by FirstNet, exceed FirstNet’s projected total expenses. Upon making any of these determinations, NTIA will communicate its determination in writing to FirstNet. (d) Outcome of determination of fee review: (1) Should NTIA make the determination listed in paragraph (c)(1) of this section, FirstNet may assess the proposed fees. (2) Should NTIA make one of the determinations listed in paragraph (c)(2) or (3) of this section, NTIA will disapprove FirstNet’s proposed fees, and FirstNet may not assess those proposed fees. (e) Revision of Proposed Fees: Upon a disapproval of FirstNet’s proposed fees as described in paragraph (d)(2) of this section, or upon FirstNet’s determination that it must revise NTIAapproved fees to ensure compliance with 47 U.S.C. 1428(b), FirstNet shall prepare a revised written submission to NTIA, which shall evaluate any proposed fees therein consistent with the rules in §§ 500.1–500.5. VerDate Sep<11>2014 16:48 Dec 14, 2015 Jkt 238001 (f) Communication of NTIA fee approval or disapproval. Approval or disapproval of FirstNet-proposed fees shall be communicated in writing by the Assistant Secretary for Communications and Information and Administrator, National Telecommunications and Information Administration, U.S. Department of Commerce, to the Chair of the FirstNet Board. Subchapter B—[Reserved] [FR Doc. 2015–31516 Filed 12–14–15; 8:45 am] BILLING CODE 3510–60–P DEPARTMENT OF THE INTERIOR Fish and Wildlife Service 50 CFR Part 17 [Docket No. FWS–R5–ES–2015–0015; 4500030113] RIN 1018–BA85 Endangered and Threatened Wildlife and Plants; Endangered Species Status for the Big Sandy Crayfish and the Guyandotte River Crayfish Fish and Wildlife Service, Interior. ACTION: Proposed rule; reopening of comment period. AGENCY: We, the U.S. Fish and Wildlife Service (Service), announce the reopening of the public comment period on our April 7, 2015, proposed rule to list the Big Sandy crayfish (Cambarus callainus) and the Guyandotte River crayfish (C. veteranus) as endangered species under the Endangered Species Act of 1973, as amended. We are taking this action to make the results of the 2015 summer surveys available for public review and comment. The surveys provide updated information on the two species’ distribution and abundance. Comments previously submitted on the April 7, 2015, proposed rule need not be resubmitted, as they will be fully considered in preparation of the final listing determination. SUMMARY: We will consider comments received or postmarked on or before January 14, 2016. Comments submitted electronically using the Federal eRulemaking Portal (see ADDRESSES section, below) must be received by 11:59 p.m. Eastern Time on the closing date. ADDRESSES: Document availability: You may obtain copies of the April 7, 2015, proposed rule and supporting material on the Internet at http:// www.regulations.gov at Docket No. DATES: PO 00000 Frm 00010 Fmt 4702 Sfmt 4702 FWS–R5–ES–2015–0015. Documents may also be obtained by mail from the Northeast Regional Office (see FOR FURTHER INFORMATION CONTACT). Written comments: You may submit written comments by one of the following methods: (1) Electronically: Go to the Federal eRulemaking Portal: http:// www.regulations.gov. In the Search box, enter FWS–R5–ES–2015–0015, which is the docket number for this rulemaking. Then, in the Search panel on the left side of the screen, under the Document Type heading, click on the Proposed Rules link to locate the document. You may submit a comment by clicking on ‘‘Comment Now!’’ (2) By hard copy: Submit by U.S. mail or hand delivery to: Public Comments Processing, Attn: FWS–R5–ES–2015– 0015, U.S. Fish and Wildlife Service, MS: BPHC, 5275 Leesburg Pike, Falls Church, VA 22041–3803. We request that you send comments only by the methods described above. We will post all comments on http:// www.regulations.gov. This generally means that we will post any personal information you provide us (see the Public Comments section, below, for more information). FOR FURTHER INFORMATION CONTACT: Martin Miller, Chief, Endangered Species, U.S. Fish and Wildlife Service, Northeast Regional Office, 300 Westgate Center Drive, Hadley, MA 01035; telephone 413–253–8615; or facsimile 413–253–8482. Persons who use a telecommunications device for the deaf (TDD) may call the Federal Information Relay Service (FIRS) at 800–877–8339. SUPPLEMENTARY INFORMATION: Background In our April 7, 2015, proposed rule (80 FR 18710), we proposed to list the Big Sandy crayfish and the Guyandotte River crayfish as endangered species primarily due to the threats of landdisturbing activities that increase erosion and sedimentation, which degrade the stream habitat required by both species, and the effects of small population size. During the 60-day public comment period on the proposed rule, we received requests to extend the comment period beyond the June 8, 2015, closing date. For rulemaking and financial efficiency, we declined to extend the comment period at that time because we were already planning to reopen the comment period in the fall of 2015 to make available the results of rangewide surveys that would be conducted for each species in the summer of 2015. The final reports for the 2015 summer surveys are now E:\FR\FM\15DEP1.SGM 15DEP1

Agencies

[Federal Register Volume 80, Number 240 (Tuesday, December 15, 2015)]
[Proposed Rules]
[Pages 77592-77598]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-31516]


=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF COMMERCE

National Telecommunications and Information Administration

47 CFR Chapter V

[Docket Number: 151209999-5999-01]
RIN 0660-AA30


Proposed Scope of NTIA's Authority Regarding FirstNet Fees

AGENCY: National Telecommunications and Information Administration, 
U.S. Department of Commerce.

ACTION: Notice of proposed rulemaking.

-----------------------------------------------------------------------

SUMMARY: The National Telecommunications and Information Administration 
(NTIA) publishes this notice of proposed rulemaking to request public 
comment as it develops rules related to its review and approval of fees 
imposed by the First Responder Network Authority (FirstNet) as 
authorized by the Middle Class Tax Relief and Job Creation Act of 2012 
(the Act).

DATES: Submit comments on or before January 14, 2016.

ADDRESSES: The public is invited to submit written comments to this 
proposed rule. Written comments may be submitted electronically through 
www.regulations.gov or by mail (to Office of Public Safety 
Communications; National Telecommunications and

[[Page 77593]]

Information Administration; U.S. Department of Commerce; 1401 
Constitution Avenue NW., Washington, DC 20230.). Comments received 
related to this proposed rule will be made a part of the public record 
and will be posted to www.regulations.gov without change. Comments 
should be machine readable and should not be copy-protected. Comments 
should include the name of the person or organization filing the 
comment as well as a page number on each page of the submission. All 
personally identifiable information (e.g., name, address) voluntarily 
submitted by the commenter may be publicly accessible. Do not submit 
confidential business information or otherwise sensitive or protected 
information.

FOR FURTHER INFORMATION CONTACT: Patrick Sullivan; Office of Public 
Safety Communications; National Telecommunications and Information 
Administration; U.S. Department of Commerce; 1401 Constitution Avenue 
NW., Washington, DC 20230; psullivan@ntia.doc.gov; (202) 482-5948.

SUPPLEMENTARY INFORMATION: 

Table of Contents

I. Introduction, Summary of Proposed Rules
II. Background: Relevant Statutory Provisions
    A. FirstNet-Assessed Fees Must Ensure Self-Funding and be 
Approved by NTIA.
    B. FirstNet's Finances are Subject to Broader, Independent 
Review.
III. NTIA's Annual Fee Review Focuses on Whether FirstNet Fees and 
Other Income, In Aggregate, Are Sufficient, and Do Not Exceed the 
Amount Necessary, to Recoup FirstNet's Total Expense
    A. Standard of NTIA Fee Review and Approval.
    B. NTIA's Fee Review and Approval Process Does Not Assess the 
Reasonableness of a Proposed Fee.
IV. Methodology of NTIA Fee Review and Approval Process
    A. Focus of NTIA Fee Review Methodology.
    B. NTIA's Fee Review and Approval Process Defers to FirstNet on 
Necessary Reserves.
V. FirstNet-Proposed Fees Subject to NTIA Review Under Section 6208 
Must be Addressed Upon NTIA Disapproval
    A. Fees Subject to NTIA Review and FirstNet Reconsideration Upon 
NTIA Disapproval.
    B. Income Other Than Fees is Not Subject to NTIA Fee Review.
VI. Ex Parte Communication

I. Introduction, Summary of Proposed Rules

    The Middle Class Tax Relief and Job Creation Act of 2012 (Pub. L. 
112-96, Title VI, 126 Stat. 256 (codified at 47 U.S.C. 1401 et seq.)) 
(Act) established the First Responder Network Authority (FirstNet) as 
an independent authority within the National Telecommunications and 
Information Administration (NTIA).\1\ Congress mandated FirstNet ensure 
the building, deployment, and operation of an interoperable nationwide 
public safety broadband network (Network).\2\ In order to meet this 
critical directive and provide affordable, reliable, and sustainable 
broadband services for first responders across the United States, 
FirstNet must operate as a business enterprise. Today, public safety 
entities procure broadband services from numerous commercial service 
providers. When it enters the market, FirstNet will start with no 
market share and will have to compete for customers by distinguishing 
its product in terms of features, price, and reliability from products 
offered by commercial providers. To be successful, FirstNet will need 
to employ business strategies with flexibility and agility commonplace 
in the private sector.
---------------------------------------------------------------------------

    \1\ See 47 U.S.C. 1424(a).
    \2\ See 47 U.S.C. 1426(b)(1) (stating FirstNet shall ``. . . 
take all actions necessary to ensure the building, deployment, and 
operation of the nationwide public safety broadband network . . 
.'').
---------------------------------------------------------------------------

    This document proposes rules that will enable NTIA to execute its 
duty to review specific fees proposed by FirstNet in a manner 
compatible with FirstNet's need to operate as a business in a 
competitive marketplace. NTIA proposes to execute its statutory fee 
review duties to afford FirstNet as much flexibility as possible to 
establish its business and budgetary goals and to adjust those goals as 
necessary to respond to the day-to-day realities of the broader 
competitive marketplace in which FirstNet must operate. Ultimately, 
NTIA intends to implement a fee review process that allows FirstNet to 
respond to changing market conditions and the demands of its vital and 
dynamic customer base: First responders.
    The Act requires FirstNet to be permanently self-funding and 
authorizes it to assess and collect certain types of fees to assure its 
sustainability. The Act requires that the total amount of FirstNet's 
annual fees must be sufficient to recoup FirstNet's total expenses, but 
such fees must not exceed the amount necessary to carry out its duties 
under the Act.\3\ As part of FirstNet's self-funding obligations, the 
Act directs NTIA to review these fees on an annual basis; they may only 
be assessed if approved by NTIA.\4\
---------------------------------------------------------------------------

    \3\ See 47 U.S.C. 1428(b).
    \4\ See 47 U.S.C. 1428(c).
---------------------------------------------------------------------------

    This notice of proposed rulemaking describes NTIA's overarching 
scope, boundaries, and guidelines for NTIA's fee review and approval 
process as required by law. Section II of this notice of proposed 
rulemaking details relevant statutory provisions and makes clear that, 
while NTIA has a distinct role through the fee review and approval 
process to ensure that FirstNet is self-funded, NTIA's role is a 
relatively limited part of broader statutory provisions designed to 
monitor FirstNet's financial condition and operational status.
    Section III defines the scope of NTIA's proposed fee review and 
approval process. NTIA has determined that this process is for a 
particular and limited purpose: it must examine only whether the 
proposed fees of another federal entity--FirstNet--as set forth under 
Section 6208 of the Act, are, in aggregate and in combination with any 
FirstNet non-fee-based income, sufficient, but not in excess of, the 
projected funds that FirstNet needs to recoup the total expenses 
required to carry out its statutory obligations in a given year. NTIA 
acknowledges that, as authorized by the Act, FirstNet might receive 
income which is separate and distinct from the fee categories defined 
in Section 6208. NTIA recognizes that such income will impact NTIA's 
determination whether FirstNet's proposed fees, in aggregate and in 
combination with such non-fee-based income, will meet but not exceed 
the funds it needs on an annual basis. However, NTIA proposes that the 
Act affords NTIA no authority to review or approve as a ``fee'' any 
other form of income FirstNet may receive beyond those fees listed in 
Section 6208(a).
    In Section IV, NTIA proposes a methodology for its fee review that 
must by law occur annually and prior to FirstNet's assessment of fees. 
Because NTIA's fee review process is for particular and limited 
purposes focusing on the financial sustainability of another federal 
entity within the Department of Commerce, NTIA will include in its 
review a review of FirstNet's projected expenses as set forth in its 
approved budgets as well as a review of FirstNet's prior-year actual 
expenses and revenues to facilitate FirstNet's compliance with Section 
6208(b). To that end, NTIA proposes to utilize FirstNet's regular 
budget process and financial statements. NTIA also proposes to defer to 
FirstNet on any need for reserves, working capital, or similar fund 
categories. NTIA, however, will take such fund categories into 
consideration as part of its determination of whether the total 
proposed fees under Section 6208(b) meet, but do not exceed, FirstNet's 
total expenses.

[[Page 77594]]

    In Section V, NTIA discusses the fees that NTIA has specific 
jurisdiction to review; if, in its review of aggregate revenues and 
costs, it determines that FirstNet has not satisfied the legal 
standard, FirstNet must adjust its fees or otherwise make budgetary 
changes to ensure that the standard is met. Specifically, NTIA proposes 
to define the term ``fee,'' for purposes of its statutory obligations 
under Section 6208(c) of the Act, to mean FirstNet's direct collection 
of money that is generated from the three categories established in 
Section 6208(a) of the Act: (1) Network user fees; (2) lease fees 
pursuant to a covered leasing agreement (CLA); and (3) fees from 
entities seeking access to or use of any network equipment or 
infrastructure constructed or otherwise owned by FirstNet.\5\ Under 
this proposed rule, NTIA can direct FirstNet to address only those 
proposed fees that fall into one of these three categories. Further, 
NTIA proposes that it will not evaluate the reasonableness, or similar 
subjective attributes, of the specific fees assessed by FirstNet or its 
prospective partner or partners as contemplated in the Act. Specific 
NTIA rules are proposed in new 47 CFR Chapter V; Subchapter A will be 
utilized for NTIA rules that relate to FirstNet, and Subchapter B will 
be reserved for rules promulgated by FirstNet itself.
---------------------------------------------------------------------------

    \5\ See 47 U.S.C. 1428(a).
---------------------------------------------------------------------------

    We seek comment on these preliminary proposals. We also look 
forward to FirstNet's progress in its procurement process, which may 
provide additional information relevant to NTIA's duties under Section 
6208(c). With such information from stakeholders and FirstNet, NTIA 
will be better informed to solidify the scope of its fee review and 
approval process as appropriate.

II. Background: Relevant Statutory Provisions

A. FirstNet-Assessed Fees Must Ensure Self-Funding and Be Approved by 
NTIA

    The Act established FirstNet as an independent authority within 
NTIA.\6\ The Act authorizes FirstNet to take all actions necessary to 
ensure the building, deployment, and operation of the Network.\7\ To 
achieve this significant and unprecedented task, FirstNet must operate 
in many respects as a private sector business enterprise.\8\
---------------------------------------------------------------------------

    \6\ See 47 U.S.C. 1424(a).
    \7\ See 47 U.S.C. 1426(b).
    \8\ To that end, the Act set forth several key provisions 
establishing FirstNet as a business enterprise. For example, the Act 
requires the creation of the FirstNet Board, which has the fiduciary 
and operational functions assigned to boards of corporations. See 47 
U.S.C. 1424(b). Furthermore, Board members appointed by the 
Secretary of Commerce must include individuals with various types of 
business experience, including expertise in building, deploying, and 
operating commercial telecommunications networks, and in financing 
and funding telecommunications networks. See id. FirstNet may only 
act as authorized by the Board to execute any powers granted by the 
Act to FirstNet, spend funds, or take other actions deemed 
necessary, appropriate, or advisable to accomplish the purposes of 
the Act. See 47 U.S.C. 1426(a)(1); see also 47 U.S.C. 1426(a)(5). As 
a business enterprise, FirstNet may contract with individuals; 
private companies; organizations; institutions; and Federal, State, 
regional, and local agencies. See 47 U.S.C. 1426(a)(3). The Act 
allows FirstNet to engage in other business activities, including 
selecting agents, consultants, or experts and hiring a program 
manager to carry out key aspects of deploying the NPSBN. See 47 
U.S.C. 1425(b).
---------------------------------------------------------------------------

    FirstNet's authority to operate as a business can and should 
further its ability to meet the Act's mandate that it become a self-
sustaining enterprise. Section 6208 of the Act makes clear that 
FirstNet must establish permanent self-funding and is authorized to 
collect fees for specified uses of the Network or its components in 
furtherance of that obligation.
    The Act established specific parameters for FirstNet's fee 
assessments described in Section 6208(a) to drive sustainability and 
continual reinvestment of FirstNet revenues into the Network. Section 
6208(b), entitled, ``Establishment of Fee Amounts; Permanent Self-
Funding,'' requires that the total amount of the fees assessed under 
Section 6208(c) for each fiscal year shall be sufficient, but cannot 
exceed, the amount necessary to recoup the total expenses of FirstNet 
as it carries out its duties under the Act.\9\ Moreover, FirstNet must 
reinvest amounts received from the assessment of fees under Section 
6208 for constructing, maintaining, operating, or improving the 
Network.\10\ Specific to FirstNet's authority to assess and collect 
these fees, Section 6208(c) requires that NTIA review such fees ``on an 
annual basis, and such fees may only be assessed if approved by . . . 
NTIA.'' \11\
---------------------------------------------------------------------------

    \9\ See 47 U.S.C. 1428(b).
    \10\ See 47 U.S.C. 1428(d).
    \11\ 47 U.S.C. 1428(c).
---------------------------------------------------------------------------

    Additionally, the Act makes clear that FirstNet should consider 
public-private partnerships, affording it additional authority to 
creatively support the provision of a self-funded broadband network for 
use by public safety entities.\12\ Such partnerships might result in 
FirstNet's collection of income that does not fall within the fees 
specified in Section 6208(a).\13\
---------------------------------------------------------------------------

    \12\ See, e.g., 47 U.S.C. 1428(a) (describing public-private 
arrangements to construct, manage, and operate the nationwide public 
safety broadband network between FirstNet and a secondary user); see 
also 47 U.S.C. 1426(b)(3) (requiring that FirstNet requests for 
proposals, to the maximum extent economically feasible, ``include 
partnerships with existing commercial mobile providers to utilize 
cost- effective opportunities to speed deployment in rural areas'').
    \13\ See, e.g., Sec.  1426(a)(3) (referencing ``grants and funds 
from . . . individuals, private companies, organizations, 
institutions, and Federal, State, regional, and local agencies''); 
Sec.  1426(a)(4) (referencing ``gifts, donations, and bequests of 
property, both real and personal'').
---------------------------------------------------------------------------

B. FirstNet's Finances are Subject to Broader, Independent Review

    NTIA's approach in this proposed rule reflects the scope of its 
fees review authority in the context of other supervision of FirstNet's 
finances and operations, which taken together, ensure a high degree of 
oversight over FirstNet's finances under the Act. The Act sets forth 
multiple methods of oversight of FirstNet well beyond the limited 
review and approval of fees required of NTIA under Section 6208(c). For 
example, FirstNet is subject to an independent financial audit. Section 
6209 of the Act requires that the Secretary of Commerce engage an 
independent auditor to conduct an annual audit of all of FirstNet's 
commercial corporate transactions which the auditor will submit to 
Congress, the President, and FirstNet.\14\ In addition, the Act 
requires an annual, ``comprehensive and detailed report of the 
operations, activities, financial condition, and accomplishments of 
[FirstNet],'' to be submitted to Congress along with ``recommendations 
or proposals for legislative or administrative action as [FirstNet] 
deems appropriate.'' \15\ Furthermore, FirstNet must comply on a day-
to-day basis with all other applicable federal financial laws and 
regulations. In light of these broader oversight provisions, NTIA's 
narrow scoping of its fee review authority is appropriate.
---------------------------------------------------------------------------

    \14\ See 47 U.S.C. 1429.
    \15\ 47 U.S.C. 1430.
---------------------------------------------------------------------------

III. NTIA's Annual Fee Review Focuses on Whether FirstNet Fees and 
Other Income, in Aggregate, Are Sufficient, and Do Not Exceed the 
Amount Necessary, To Recoup FirstNet's Total Expenses

A. Standard of NTIA Fee Review and Approval

    The Act does not provide a specific standard of review for NTIA's 
annual fee review and approval process under Section 6208(c).\16\ 
However, examination of other provisions in Section 6208 and the Act at 
large inform NTIA's proposed approach to FirstNet

[[Page 77595]]

fee review. FirstNet has a duty under Section 6208(b) to ensure that, 
during a given fiscal year, the fees it assesses are sufficient, and 
shall not exceed the amount necessary, to recoup the ``total expenses'' 
associated with carrying out its duties as specified under the Act.\17\
---------------------------------------------------------------------------

    \16\ See 47 U.S.C. 1428(c).
    \17\ See 47 U.S.C. 1428(b).
---------------------------------------------------------------------------

    Given this overarching directive in Section 6208(b), which 
immediately precedes the Act's assignation of fee review to NTIA in 
Section 6208(c), NTIA proposes that the Act's purpose for the fee 
review is solely to support FirstNet's obligation under Section 6208(b) 
to be self-funding. Thus, NTIA intends to base its decisions on 
FirstNet's proposed fees by only examining whether the fees are, in 
aggregate and combined with other non-fee-based income, sufficient, but 
not in excess, of the projected funds FirstNet needs to carry out its 
statutory obligations in a given fiscal year. In this way, NTIA's 
review and approval of FirstNet-proposed fees under Section 6208 will 
exclusively focus on FirstNet's projected income and expenses to 
further the self-funding requirements and limitations of Section 
6208(b). We seek comment on this proposed approach.

B. NTIA's Fee Review and Approval Process Does Not Assess the 
Reasonableness of a Proposed Fee

    The scope of review of a fee is established by the statute.\18\ As 
a result, we propose that NTIA's fee review is scoped to self-
sustainability and does not include review of the reasonableness of any 
fee assessed by FirstNet or its prospective partner or partners as 
contemplated in the Act.
---------------------------------------------------------------------------

    \18\ See Principles of Federal Appropriations Law, Volume III, 
Third Edition, GAO, pp 12-140-12-181. GAO 08-978 SP (Washington, DC, 
September 2008).
---------------------------------------------------------------------------

    The wording of the Act itself does not direct NTIA to perform a 
reasonableness review. Section 6208(b), entitled, ``Establishment Of 
Fee Amounts; Permanent Self-Funding,'' requires that the total amount 
of the fees assessed by FirstNet for each fiscal year must be 
sufficient, but cannot exceed, the amount necessary to recoup the total 
expenses of FirstNet as it carries out its duties under the Act.\19\ 
NTIA's mandate to review and approve FirstNet fees directly follows 
this fee structure requirement in Section 6208(c).\20\ The Act provides 
no other direction regarding fee review, but the structure of the 
statute clearly indicates congressional intent to ensure that the 
assessed fees drive a self-funded network.
---------------------------------------------------------------------------

    \19\ See 47 U.S.C. 1428(b).
    \20\ See 47 U.S.C. 1428(c).
---------------------------------------------------------------------------

    A review of other provisions of Title 47 demonstrates that when 
Congress intends for rates to be subject to a review for 
``reasonableness'' or other subjective standards, it states this 
intention explicitly. For example, Section 201 of the Communications 
Act directs the Federal Communications Commission (FCC) to determine 
whether the charges of telecommunications carriers are ``just and 
reasonable.'' \21\ Similarly, Section 224 of the Communications Act 
directs the FCC to regulate the rates, terms, and conditions of pole 
attachments to ensure they are ``just and reasonable.'' \22\ Here, with 
respect to FirstNet's assessment of fees under Section 6208, and NTIA's 
review and approval of such fees, the Act established no such ``just 
and reasonable'' standard.
---------------------------------------------------------------------------

    \21\ See 47 U.S.C 201 (stating that, for common carrier 
services, ``[a]ll charges . . . for and in connection with such 
communication service, shall be just and reasonable, and any such 
charge, practice, classification, or regulation that is unjust or 
unreasonable is hereby declared to be unlawful.'').
    \22\ See 47 U.S.C 224 (b)(1) (stating that ``the Commission 
shall regulate the rates, terms, and conditions for pole attachments 
to provide that such rates, terms, and conditions are just and 
reasonable, and shall adopt procedures necessary and appropriate to 
hear and resolve complaints concerning such rates, terms, and 
conditions.'')
---------------------------------------------------------------------------

    Moreover, a reasonableness review of FirstNet fees is unnecessary 
as a matter of policy. The Act does not mandate or require any public 
safety entity to purchase services from FirstNet. FirstNet must compete 
for subscribers by offering a compelling value proposition to 
prospective public safety customers. Public safety users themselves 
will determine whether FirstNet's proposed user fees are reasonable in 
comparison to the fees they are offered by competing providers.
    Thus, NTIA proposes that it will not assess whether individual or 
total fees in any given category described in Section 6208(a) are 
reasonable, proportionate, or otherwise subjectively appropriate in 
light of individual or total fees in that category, or any other 
category of fees listed in Section 6208(a). With the proposed scope of 
its fee review, NTIA meets the intent of the self-funding provisions, 
but does not import ``just and reasonable'' review parameters that 
Congress clearly could have, but did not, include in the statute. We 
seek comment on these preliminary proposals.

IV. Methodology of NTIA Fee Review and Approval Process

A. Focus of NTIA Fee Review Methodology

    Based on the preliminary conclusions above, NTIA proposes to base 
its approval of fees upon a determination of whether the proposed fees, 
in aggregate, when combined with any projected non-fee-based income 
that FirstNet receives, meet but do not exceed FirstNet's anticipated 
total expenses associated with carrying out its duties as specified 
under the Act in a given year. As required by the Act, NTIA will 
conduct its fee review and approval process on an annual basis. 
Further, NTIA's proposed fee review and approval process will occur 
before a fee is assessed as required by the Act, and NTIA expects that 
FirstNet will propose such fees to NTIA in writing. Because FirstNet 
must compete in a broader marketplace for the opportunity to provide 
broadband service to public safety entities, it will need the 
flexibility over the course of a fiscal year to adjust specific fees it 
wishes to assess pursuant to Section 6208(a).
    Thus, to empower FirstNet with the flexibility needed to compete in 
the marketplace, NTIA proposes that, as part of its annual fee review, 
it will also review FirstNet's actual fees and expenses from the 
previous four fiscal quarters. This process will afford FirstNet the 
opportunity to describe any significant discrepancies between projected 
and actual expenses and revenue of that previous fiscal year and detail 
how its projected fees and revenues for the upcoming fiscal year have 
addressed these discrepancies. In doing so, FirstNet will have an 
opportunity on an annual basis to ensure that its duty under Section 
6208(b) is met. To determine FirstNet's anticipated expenses, among the 
specific costs areas that NTIA may consider are: (1) Salaries and 
Benefits; (2) Travel; (3) Services: Federal Sources; (4) Services: Non-
Federal Sources; (5) Facilities Rental; (6) Supplies, Materials, and 
Printing; (7) Equipment; and (8) Other expenses or obligations incurred 
for future contract award, capital reserves, or other permitted 
expenses or obligations. NTIA anticipates deferring to FirstNet to 
determine the reasonableness of projected obligations in the 
aforementioned or other categories.
    Throughout the fee review and approval process, NTIA anticipates 
utilizing the budget documents and financial statements produced in the 
normal course of FirstNet's business. NTIA might also utilize 
FirstNet's

[[Page 77596]]

annual budget reports as approved by the FirstNet Board and submitted 
as part of the President's Budget and FirstNet's mandated annual report 
to Congress.
    Therefore, NTIA proposes that it will make, on an annual basis, one 
of three determinations with regard to proposed fees: (1) FirstNet's 
proposed fees, in aggregate, when combined with any projected non-fee-
based income to be received by FirstNet, meet but do not exceed 
FirstNet's projected total expenses; (2) FirstNet's proposed fees, in 
aggregate, when combined with any projected non-fee-based income to be 
received by FirstNet, do not meet FirstNet's projected total expenses; 
or (3) FirstNet's proposed fees, in aggregate, when combined with any 
projected non-fee-based income to be received by FirstNet, exceed 
FirstNet's projected total expenses. Upon making any of these 
determinations, NTIA will communicate its determination in writing to 
FirstNet. Should NTIA make the second or third determination listed 
above, NTIA will not approve FirstNet's proposed fees, and FirstNet may 
not assess them. NTIA proposes that it will accept any revised proposed 
fees or FirstNet approved revised budgets when provided by FirstNet in 
writing and evaluate them consistent with the scope and methodology 
proposed above.
    We seek comment on this proposed approach to NTIA's fee review and 
approval process. We also seek comment on alternative methodologies 
that will further our fee review and approval process consistent with 
the Act's directives.

B. NTIA's Fee Review and Approval Process Defers to FirstNet on 
Necessary Reserves

    NTIA proposes that it should defer to FirstNet, in the context of 
its budgetary planning process, regarding the use and retention of 
reserves or working capital funds. By doing so, NTIA will not, in its 
fee review and approval process, assess whether or what level of funds 
FirstNet should maintain in reserves, capital accounts, or other 
funding categories. FirstNet's routine budget, auditing, and accounting 
processes will presumably determine the need for such capital reserve 
funds. NTIA plans to defer to FirstNet's determination of need for such 
funds through these processes. We seek comment on this proposed 
approach to NTIA's fee review and approval process.
    Moreover, NTIA proposes that, in its fee review and approval 
process, it will take into consideration reserve funds at the levels 
designated in FirstNet's budget, to determine whether FirstNet's 
proposed fees meet but not exceed FirstNet's total expenses. In doing 
so, NTIA will deem such funds to be a part of FirstNet's projected 
total expenses under Section 6208(b) of the Act. We seek comment on 
this proposal.

V. FirstNet-Proposed Fees Subject to NTIA Review Under Section 6208 
Must Be Addressed Upon NTIA Disapproval

A. Fees Subject to NTIA Review and FirstNet Reconsideration Upon NTIA 
Disapproval

    The Act assigns a clear duty to NTIA under Section 6208: approve or 
disapprove the specific fees FirstNet aspires to assess under Section 
6208. Under Section 6208(a) of the Act, FirstNet is authorized to 
assess and collect the following fees:

    1. A Network User Fee: ``A user or subscription fee from each 
entity, including any public safety entity or secondary user, that 
seeks access to or use of the [Network].'' \23\
---------------------------------------------------------------------------

    \23\ 47 U.S.C. 1428(a)(1).
---------------------------------------------------------------------------

    2. Fees Pursuant to a Covered Leasing Agreement: ``A fee from 
any entity that seeks to enter into a [CLA].'' \24\
---------------------------------------------------------------------------

    \24\ 47 U.S.C. 1428(a)(2)(A); See also 47 U.S.C. 1428(a)(2)(B) 
(stating that the Act defines a CLA as ``a written agreement 
resulting from a public-private arrangement to construct, manage, 
and operate the nationwide public safety broadband network between 
the First Responder Network Authority and secondary user to permit--
(i) access to network capacity on a secondary basis for non-public 
safety services; and (ii) the spectrum allocated to such entity to 
be used for commercial transmissions along the dark fiber of the 
long-haul network of such entity.'').
---------------------------------------------------------------------------

    3. Lease Fees Related to Network Equipment and Infrastructure: 
``A fee from any entity that seeks access to or use of any equipment 
or infrastructure, including antennas or towers, constructed or 
otherwise owned by the First Responder Network Authority resulting 
from a public-private arrangement to construct, manage, and operate 
the [Network]'' \25\
---------------------------------------------------------------------------

    \25\ 47 U.S.C. 1428(a)(3).

    As a threshold matter for purposes of this proposed rule and NTIA's 
duty under Section 6208 of the Act, the word ``fee,'' as used in 
Section 6208(c) of the Act, must be defined. By defining the fees NTIA 
is to review, NTIA identifies the specific fees FirstNet must address 
prior to NTIA approval in the event NTIA must disapprove FirstNet-
approved fees under the standards set forth above.
    To implement its fee review obligations under the Act, NTIA must 
determine the meaning of the term ``fee'' as used in Section 6208. In 
the case of the Act, the three sets of fees, which FirstNet may assess, 
and which NTIA must review if assessed, are clearly defined within 
Section 6208(a). Thus, NTIA proposes that a ``fee'' that will be 
subject to its review and approval under Section 6208(c) is FirstNet's 
collection of money that falls within the three categories in Section 
6208(a): (1) Network user fees; (2) lease fees related to network 
capacity, pursuant to a covered leasing agreement; and (3) fees from 
entities seeking access to or use of any equipment or infrastructure 
constructed or otherwise owned by FirstNet.\26\ Given the clear 
language in Section 6208(a) defining the fees that FirstNet may assess, 
and the corresponding language in Section 6208(c) directing NTIA to 
review fees ``assessed under [Section 6208],'' NTIA proposes that its 
fee review authority, and FirstNet's obligation to address fees upon 
NTIA disapproval of proposed fees, is scoped to the three above-
referenced categories. We seek comment on this preliminary proposal.
---------------------------------------------------------------------------

    \26\ See 47 U.S.C. 1428(a).
---------------------------------------------------------------------------

B. Income Other Than Fees Is Not Subject to NTIA Fee Review

    As noted above, NTIA recognizes that, under the Act, FirstNet may 
receive income that is separate and distinct from the fees defined in 
Section 6208(a). Such income must be factored into NTIA's determination 
of whether proposed fees, in aggregate, will meet but not exceed the 
funds needed by FirstNet on an annual basis. However, as the Act limits 
NTIA's review and approval authority to ``the fees assessed in [Section 
6208],'' NTIA proposes that the Act gives it no authority to review or 
approve as a ``fee'' any other form of income FirstNet might receive. 
NTIA proposes that non-fee-based income, emanating from arrangements 
allowed by statute, is not a ``fee'' under Section 6208(a). 
Furthermore, NTIA proposes that it will consider any non-fee income 
only as part of its determination of whether such income, when combined 
in aggregate with the fees defined in Section 6208(a), will be 
sufficient to recoup FirstNet's total expenses, but not exceed the 
amount necessary, to carry out its statutory duties and 
responsibilities for the fiscal year involved. Moreover, NTIA proposes 
that it will not analyze the terms and conditions of any CLA, or any 
other agreement between FirstNet and another entity, beyond those 
specific terms and conditions which establish any fees that meet the 
three categories described in Section 6208(a). We seek comment on these 
preliminary proposals.

VI. Ex Parte Communications

    Any non-public oral presentation to NTIA regarding the substance of 
this proposed rule will be considered an ex parte presentation, and the 
substance of

[[Page 77597]]

the meeting will be placed on the public record and become part of this 
docket. No later than two (2) business days after an oral presentation 
or meeting, an interested party must submit a memorandum to NTIA 
summarizing the substance of the communication. NTIA reserves the right 
to supplement the memorandum with additional information as necessary, 
or to request that the party making the filing do so, if NTIA believes 
that important information was omitted or characterized incorrectly. 
Any written presentation provided in support of the oral communication 
or meeting will also be placed on the public record and become part of 
this docket. Such ex parte communications must be submitted to this 
docket as provided in the ADDRESSES section above and clearly labeled 
as an ex parte presentation. Federal entities are not subject to these 
procedures.

Classification

    This rule has been determined to be not significant for purposes of 
Executive Order 12866.

Regulatory Flexibility Act

    This proposed rulemaking, issued under the authority of the Act, 
will not have a significant economic impact on a substantial number of 
small entities as defined under the Regulatory Flexibility Act (RFA). 
If implemented, this rule would establish regulations, as required 
under the Act, for NTIA and FirstNet regarding the process by which 
NTIA reviews and approves or disapproves fees FirstNet proposes to 
assess. The RFA requires federal agencies to prepare an analysis of a 
rule's impact on small entities whenever the agency is required to 
publish a notice of proposed rulemaking. However, a federal agency may 
certify, pursuant to 5 U.S.C. 605(b), that the action will not have a 
significant economic impact on a substantial number of small entities. 
The proposed regulations are for the particular and limited purpose of 
NTIA examining only whether the proposed fees of another federal 
entity--FirstNet--are, in aggregate and in combination with any 
FirstNet non-fee-based income, sufficient, but not in excess of, the 
projected funds that FirstNet needs to recoup the total expenses 
required to carry out its statutory obligations in a given year. No 
external entities, including any small businesses, small organizations, 
or small governments, will experience any direct economic impacts from 
this proposed rule. The only potential effect on any external entities, 
large or small, would likely be positive, as NTIA's proposed rules will 
assist in ensuring that FirstNet, as required under the Act, will 
sustain a nationwide public safety broadband network that provides 
broadband communications to first responders. Because this action, if 
adopted, would directly affect only federal entities--NTIA and 
FirstNet--and not any small entities, the Department of Commerce has 
concluded that the action would not result in a significant economic 
impact on a substantial number of small entities. Thus, the Department 
of Commerce Chief Counsel for Regulations has certified to the Chief 
Counsel for Advocacy of the Small Business Administration that this 
rule will not have a significant impact on a substantial number of 
small entities. Therefore, an initial regulatory flexibility analysis 
is not required and has not been prepared.

Executive Order 13132

    It has been determined that this document does not contain policies 
with Federalism implications as that term is defined in Executive Order 
13132.

List of Subjects in 47 CFR Part 500

    FirstNet, FirstNet Fees, Safety, Telecommunications.

    Dated: December 10, 2015.
Lawrence E. Strickling,
Assistant Secretary for Communications and Information.

    For the reasons set out in the preamble, the National 
Telecommunications and Information Administration proposes to add 47 
CFR Chapter V to read as follows:

CHAPTER V--THE FIRST RESPONDER NETWORK AUTHORITY (Parts 500-599)

SUBCHAPTER A--NATIONAL TELECOMMUNICATIONS AND INFORMATION 
ADMINISTRATION REGULATIONS (Parts 500-549)

PART 500--REVIEW AND APPROVAL OF FEES PROPOSED BY THE FIRST RESPONDER 
NETWORK AUTHORITY (FIRSTNET)

Sec.
500.1 Purpose and scope.
500.2 General definitions.
500.3 NTIA duty to review FirstNet proposed fees.
500.4 Scope of NTIA review of FirstNet proposed fees.
500.5 Methodology of NTIA fee review and approval process.

    Authority:  47 U.S.C. 1401.


Sec.  500.1  Purpose and scope.

    Sections 500.2 through 500.5 implement 47 U.S.C. 1428(c) as 
codified pursuant to the Middle Class Tax Relief and Job Creation Act 
of 2012 (Pub. L. 112-96, Title VI, 126 Stat. 256 (codified at 47 U.S.C. 
1401 et seq.) (the ``Act''), which requires the National 
Telecommunications and Information Administration to annually review 
fees the First Responder Network Authority (FirstNet) proposes to 
assess.


Sec.  500.2  General definitions.

    Fee means FirstNet's receipt of money from:
    (1) A Network User Fee;
    (2) Lease Fees Related To Network Capacity; or
    (3) Lease Fees Related To Network Equipment And Infrastructure, as 
those terms are defined under 47 U.S.C. 1428(a).
    FirstNet means the First Responder Network Authority.
    Fiscal Year means the 12-month accounting period for the federal 
government, which begins on 1 October of a given year and ends on 30 
September of the subsequent year.
    Non-fee-based income received by FirstNet means FirstNet's receipt 
of money from any source, transaction, entity, or any other means 
allowed under 47 U.S.C. 1401 et seq., other than those receipts 
described above in the definition of ``fee.''
    NTIA means the National Telecommunications and Information 
Administration.
    NTIA's fee review and approval process means the process by which 
NTIA executes its duties under 47 U.S.C. 1428(c).


Sec.  500.3  NTIA's duty to review FirstNet proposed fees.

    As required under 47 U.S.C. 1428(c), NTIA shall exclusively review 
fees, which must be proposed by FirstNet in writing, through NTIA's 
review and approval process conducted on an annual basis.


Sec.  500.4  Scope of NTIA review of FirstNet proposed fees.

    NTIA shall approve FirstNet proposed fees only if such fees, when 
combined with any non-fee-based income projected to be received by 
FirstNet, are sufficient, but do not exceed the amount necessary, to 
recoup FirstNet's total expenses in carrying out its duties and 
responsibilities under 47 U.S.C. 1401 et seq. for the fiscal year 
involved.


Sec.  500.5  Methodology of NTIA fee review and approval process.

    (a) Fee review approach. To execute NTIA's fee review and approval 
process, NTIA shall utilize FirstNet's standard financial 
documentation, which may include but is not limited to:

[[Page 77598]]

    (1) FirstNet's budget documents produced in the normal course of 
its business;
    (2) FirstNet's financial statements produced in the normal course 
of its business;
    (3) FirstNet's annual budget reports submitted as part of the 
President's Budget; and
    (4) FirstNet's annual report to Congress.
    (b) Deference to FirstNet on necessary reserves. In executing 
NTIA's fee review and approval process, NTIA shall defer to FirstNet 
with respect to its use and retention of reserve or working capital 
funds. NTIA shall consider any such designated funds to be a part of 
FirstNet's total expenses in carrying out its duties and 
responsibilities under 47 U.S.C. 1401 et seq. for the fiscal year 
involved.
    (c) Determination of fee review: NTIA shall make one of the 
following determinations annually upon review of FirstNet's proposed 
fees:
    (1) FirstNet's proposed fees, in aggregate, when combined with any 
projected non-fee-based income to be received by FirstNet, meet but do 
not exceed FirstNet's projected total expenses;
    (2) FirstNet's proposed fees, in aggregate, when combined with any 
projected non-fee-based income to be received by FirstNet, do not meet 
FirstNet's projected total expenses; or
    (3) FirstNet's proposed fees, in aggregate, when combined with any 
projected non-fee-based income to be received by FirstNet, exceed 
FirstNet's projected total expenses. Upon making any of these 
determinations, NTIA will communicate its determination in writing to 
FirstNet.
    (d) Outcome of determination of fee review:
    (1) Should NTIA make the determination listed in paragraph (c)(1) 
of this section, FirstNet may assess the proposed fees.
    (2) Should NTIA make one of the determinations listed in paragraph 
(c)(2) or (3) of this section, NTIA will disapprove FirstNet's proposed 
fees, and FirstNet may not assess those proposed fees.
    (e) Revision of Proposed Fees: Upon a disapproval of FirstNet's 
proposed fees as described in paragraph (d)(2) of this section, or upon 
FirstNet's determination that it must revise NTIA-approved fees to 
ensure compliance with 47 U.S.C. 1428(b), FirstNet shall prepare a 
revised written submission to NTIA, which shall evaluate any proposed 
fees therein consistent with the rules in Sec. Sec.  500.1-500.5.
    (f) Communication of NTIA fee approval or disapproval. Approval or 
disapproval of FirstNet-proposed fees shall be communicated in writing 
by the Assistant Secretary for Communications and Information and 
Administrator, National Telecommunications and Information 
Administration, U.S. Department of Commerce, to the Chair of the 
FirstNet Board.

Subchapter B--[Reserved]

[FR Doc. 2015-31516 Filed 12-14-15; 8:45 am]
BILLING CODE 3510-60-P