Assessment and Collection of Regulatory Fees for Fiscal Year 2015

AGENCY:

Federal Communications Commission.

ACTION:

Final rule.

SUMMARY:

In this document the Commission revises its Schedule of Regulatory Fees to recover an amount of $339,844,000 that Congress has required the Commission to collect for fiscal year 2015. Section 9 of the Communications Act of 1934, as amended, provides for the annual assessment and collection of regulatory fees under sections 9(b)(2) and 9(b)(3), respectively, for annual “Mandatory Adjustments” and “Permitted Amendments” to the Schedule of Regulatory Fees.

DATES:

Effective September 17, 2015. To avoid penalties and interest, regulatory fees should be paid by the due date of September 24, 2015.

FOR FURTHER INFORMATION CONTACT:

Roland Helvajian, Office of Managing Director at (202) 418-0444.

SUPPLEMENTARY INFORMATION:

This is a summary of the Commission's Report and Order (R&O), FCC 15-108, MD Docket No. 15-121, adopted on September 1, 2015 and released on September 2, 2015.

I. Administrative Matters

A. Final Regulatory Flexibility Analysis

1. As required by the Regulatory Flexibility Act of 1980 (RFA), the Commission has prepared a Final Regulatory Flexibility Analysis (FRFA) relating to this Report and Order. The FRFA is contained towards the end of this document.

B. Final Paperwork Reduction Act of 1995 Analysis

2. This document does not contain new or modified information collection requirements subject to the Paperwork Reduction Act of 1995 (PRA), Public Law 104-13. In addition, therefore, it does not contain any new or modified information collection burden for small business concerns with fewer than 25 employees, pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4).

C. Congressional Review Act

3. The Commission will send a copy of this Report and Order to Congress and the Government Accountability Office pursuant to the Congressional Review Act. 5 U.S.C. 801(a)(1)(A).

II. Introduction and Executive Summary

4. This Report and Order adopts a schedule of regulatory fees to assess and collect $339,844,000 in regulatory fees for Fiscal Year (FY) 2015, pursuant to Section 9 of the Communications Act of 1934, as amended (the Act or Communications Act) and the Commission's FY 2015 Appropriation. The schedule of regulatory fees for FY 2015 adopted here is attached in Table C. These regulatory fees are due in September 2015.

5. The FY 2015 regulatory fees are based on the proposals in the FY 2015 NPRM, considered in light of the comments received and Commission analysis. The FY 2015 regulatory fee schedule includes the following noteworthy changes from prior years: (1) A reduction in regulatory fees for the submarine cable/terrestrial and satellite bearer circuit (IBC) category relative to other fee categories in the International Bureau; (2) the first fee rate for Direct Broadcast Satellite (DBS) as a subcategory of the cable television and Internet Protocol Television (IPTV) regulatory fee category; (3) the first fee rate for toll free numbers; and (4) the elimination of the regulatory fee component of two fee categories: amateur radio Vanity Call Signs and General Mobile Radio Service (GMRS). In addition, for FY 2015, in calculating the fee schedule, the Commission also reallocated four International Bureau full time employees (FTEs) from direct to indirect.

III. Background

6. Congress adopted a regulatory fee schedule in 1993 and authorized the Commission to assess and collect annual regulatory fees pursuant to the schedule, as amended by the Commission. As a result, the Commission annually reviews the regulatory fee schedule, proposes changes to the schedule to reflect changes in the amount of its appropriation, and proposes increases or decrease to the schedule of regulatory fees. The Commission makes changes to the regulatory fee schedule “if the Commission determines that the schedule requires amendment to comply with the requirements” of section 9(b)(1)(A) of the Act. The Commission may also add, delete, or reclassify services in the fee schedule to reflect additions, deletions, or changes in the nature of its services “as a consequence of Commission rulemaking proceedings or changes in law.” Thus, for each fiscal year, the proposed fee schedule in the annual Notice of Proposed Rulemaking (NPRM) will reflect changes in the amount appropriated for the performance of the FCC's regulatory activities, changes in the industries represented by the regulatory fee payers, changes in Commission FTE levels, and any other issues of relevance to the proposed fee schedule. After receipt and review of comments, the Commission issues a Report and Order adopting the fee schedule for the fiscal year and sets out the procedures for payment of fees.

7. The Commission calculates the fees by first determining the FTE number of employees performing the regulatory activities specified in section 9(a), “adjusted to take into account factors that are reasonably related to the benefits provided to the payor of the fee by the Commission's activities . . . .” FTEs are categorized as “direct” if they are performing regulatory activities in one of the “core” bureaus, i.e., the Wireless Telecommunications Bureau, Media Bureau, Wireline Competition Bureau, and part of the International Bureau. All other FTEs are considered “indirect.” The total FTEs for each fee category is calculated by counting the number of direct FTEs in the core bureau that regulates that category, plus a proportional allocation of indirect FTEs. Next, the Commission allocates the total amount to be collected among the various regulatory fee categories. This allocation is based on the number of FTEs assigned to work in each regulatory fee category. Each regulatee within a fee category pays its proportionate share based on an objective measure, e.g., revenues, number of subscribers, or licenses.

8. As part of its annual review, the Commission regularly seeks to improve its regulatory fee analysis. For example, in the FY 2013 Report and Order, the Commission adopted updated FTE allocations to more accurately reflect the number of FTEs working on regulation and oversight of the regulatees in the various fee categories, combined the UHF and VHF television stations into one regulatory fee category, and created a fee category to include IPTV. Subsequently, in the FY 2014 Report and Order and FNPRM, the Commission adopted a new fee category for toll free numbers, increased the de minimis threshold, and eliminated several categories from the regulatory fee schedule. Earlier this year, in our FY 2015 Fee Reform Report and Order, we added a subcategory for DBS providers in the cable television and IPTV regulatory fee category.

9. In our FY 2015 NPRM, we proposed to collect $339,844,000 in regulatory fees and included a detailed, proposed fee schedule. We also sought comment on (1) a proposal revising the apportionment between the submarine cable/terrestrial and satellite bearer circuits fee category and the space station/earth station fee category; (2) revising an apportionment of regulatory fees among broadcasters; (3) a request for relief from regulatory fee assessments for radio stations in Puerto Rico filed by the Puerto Rico Broadcasters Association (PRBA); (4) raising earth station regulatory fees relative to space station fees; (5) a new regulatory fee for toll free numbers; (6) a new regulatory fee for DBS (as a subcategory in the cable television and IPTV regulatory fee category); and (7) whether certain FTEs should be allocated as direct instead of indirect. We received 13 comments and eight reply comments. The list of commenters is attached in Table A.

IV. Report And Order

A. Discussion

1. FY 2015 Regulatory Fees

10. In this Report and Order, we adopt a regulatory fee schedule for FY 2015, pursuant to Section 9 of the Communications Act and our FY 2015 appropriation statute in order to collect $339,844,000 in regulatory fees. Of this amount, we project approximately $18.56 million (5.45 percent of the total FTE allocation) in fees from the International Bureau regulatees; $69.07 million (20.28 percent of the total FTE allocation) in fees from the Wireless Telecommunications Bureau regulatees; $132.81 million (38.99 percent of the total FTE allocation) from Wireline Competition Bureau regulatees; and $120.15 million (35.28 percent of the total FTE allocation) from the Media Bureau regulatees. These regulatory fees are due in September 2015. The schedule of regulatory fees for FY 2015 adopted here is attached as Table C.

2. Toll Free Numbers

11. In the FY 2014 Report and Order and FNPRM, we adopted a regulatory fee category for each toll free number managed by a RespOrg. In the FY 2015 NPRM, we sought comment on a regulatory fee of 12 cents per toll free number. In this Report and Order, we adopt the proposed fee of 12 cents per toll free number.

3. Submarine Cable

12. In the FY 2014 Report and Order and FNPRM, we concluded that the regulatory fee assessment for the submarine cable/terrestrial and satellite bearer circuits fee category did not fairly take into account the Commission's minimal oversight and regulation of the international bearer circuit (IBC) industry. Accordingly, we reduced the total regulatory fee apportionment for submarine cable/terrestrial and satellite bearer circuits by five percent and stated that we would revisit the issue to determine if additional adjustment is warranted. Subsequently, in the FY 2015 NPRM, we sought comment on further reducing the regulatory fee allocation for the submarine cable/terrestrial and satellite bearer circuit fee category. In particular, we observed that after the initial licensing process, the regulatory activity concerning submarine cable/terrestrial and satellite bearer circuit systems is primarily limited to reviewing the Circuit Capacity Reports and quarterly reports filed by licensees. Based on our tentative conclusion that the fee remained excessive relative to the minimal Commission oversight and regulation of this industry, we proposed another five percent decrease in fees.

13. NASCA, representing submarine cable operators, argues that the proposed fee remains excessive because the industry would be responsible for 27.6 percent of all International Bureau regulatory fees. Commenters also contend that the apportionment of regulatory fees for submarine cable operators and terrestrial and satellite bearer circuits remains too high due to the small number of FTEs working on those services. Some commenters observe as well that the high regulatory fees imposed on the submarine cable operators can place the United States at a competitive disadvantage because Canada and Mexico have much lower fees and the submarine cable industry may choose to land new cables in those countries instead. Commenters suggest that this could pose national security issues if the submarine cable operators choose to build out in Canada and Mexico, because those facilities would not be subject to the Communications Assistance for Law Enforcement Act, commonly known as CALEA. EchoStar contends that we have not supported our proposal to reduce the IBC fees with sufficient facts.

14. In 2009, the Commission adopted a new regulatory fee methodology for submarine cable based on a proposal by a large group of submarine cable operators. Under this methodology, after we apportion the IBC revenue requirement between the terrestrial and satellite facilities and submarine cable, we assess the submarine cable systems on a per cable landing license basis, with higher fees for larger systems and lower fees for smaller systems (the regulatory fees for terrestrial and satellite facilities are still assessed on a per bearer circuit basis). The regulatory fees that are now paid by the submarine cable operators cover the services provided to common carriers using the submarine cable circuits in addition to the services that the International Bureau provides to submarine cable operators. The International Bureau's regulatory activity concerning submarine cable includes licensing, reviewing the Circuit Capacity Reports and filed quarterly reports. In addition, all International Bureau services provided to common carriers using the submarine cable circuits, such as benchmarks enforcement, protection from anticompetitive actions by foreign carriers, foreign ownership rulings (Petitions for Declaratory Rulings, or PDRs), section 214 authorizations, and bilateral and multilateral negotiations and representation of U.S. interests at international organizations, are all provided by the International Bureau on behalf of the common carriers using submarine cable circuits. Upon this further analysis, we conclude that our previous estimate of two FTEs working on IBC issues discussed in FY 2014 Report and Order, did not take these issues into account. Nevertheless, as we have discussed previously in the FY 2013 NPRM, FY 2014 NPRM, and the FY 2015 NPRM, the oversight and regulation of the IBC industry may warrant additional adjustment to the fee allocation. For the reasons discussed above, we reduce the regulatory fee apportionment for submarine cable/terrestrial and satellite bearer circuits by 7.5 percent to more accurately reflect the regulation and oversight for the industry. This analysis reflects both the direct work on submarine cable/terrestrial and satellite bearer circuit issues and other common carrier issues by International Bureau FTEs and the indirect FTEs that devote their time to International Bureau regulatees as a whole. We find that this decrease in the regulatory fees paid by IBCs more accurately reflects the level of regulation and oversight for this industry. Also, we reject the speculation that failure to reduce regulatory fees as much as the submarine cable operators might prefer could lead to a change in the cable landing locations. We also reject EchoStar's statement that our proposal lacked factual support. As noted above, the regulatory oversight of this fee category has been explained in detail in this, and prior proceedings, and has been the subject of comments by submarine cable operators for a number of years.

4. Earth Stations

15. In the FY 2014 NPRM, the Commission recognized that the International Bureau's oversight and regulation of the satellite industry involves FTEs working on legal, technical, and policy issues pertaining to both space station and earth station operations and is therefore interdependent to some degree. For that reason, we sought comment on whether we should increase the earth station regulatory fee allocation in order to reflect more appropriately the number of FTEs devoted to the regulation and oversight of the earth station portion of the satellite industry. In the FY 2014 regulatory fee proceeding, we increased the regulatory fees paid by earth station licensees by approximately 7.5 percent based on our analysis and review of the record.

16. In the FY 2015 NPRM, we sought comment on whether to raise the earth station regulatory fees again. We find, however, that this issue requires further analysis. In particular, due to comments suggesting that we adopt different regulatory fees for different types of earth stations and an ongoing proceeding concerning Part 25 (Satellite Communications) of the Commission's rules which may affect the distribution of FTE work, we plan to further examine and consider this issue for FY 2016. In doing so, we intend to seek comment on EchoStar's proposal to assess different levels of regulatory fees on different types of earth station licenses.

5. FTE Reallocations

17. As explained above in paragraph five, we calculate regulatory fees by classifying FTEs either as direct or indirect. FTEs classified as direct are further associated with one of the core bureaus. The Commission now updates FTE allocations on an annual basis to more accurately reflect the number of FTEs working on regulation and oversight of the regulatees in the various fee categories. The Commission has also previously determined that some of the International Bureau FTEs should be considered indirect instead of direct. We find that apart from the unique nature of the International Bureau FTEs, the work of all the FTEs in a core bureau contributes to the cost of regulating and overseeing the licensees of that bureau. Therefore, we may reasonably expect that the work of the FTEs in the core bureaus would remain focused on the industry segment regulated by each of those bureaus. The work of the FTEs in the remaining (i.e., indirect) bureaus and offices benefits the Commission and the telecommunications industry and is not specifically focused on the licensees of a particular core bureau. Given the significant implications of reassignment of FTEs in our fee calculation, we make changes to FTE classifications only after performing considerable analysis and finding the clearest case for reassignment.

a. Request To Characterize Indirect FTEs as Direct FTEs

18. SIA and EchoStar propose that we consider FTEs working in certain divisions of the Enforcement Bureau and the Consumer & Governmental Affairs Bureau and the Office of Engineering & Technology (i.e., indirect FTEs) as direct FTEs, associated with a core bureau for purposes of regulatory fee calculation. SIA contends that the work in the Market Disputes Resolution Division “is limited to complaints against common carriers and pole attachment disputes” and the “Telecommunications Consumers Division focuses on protecting consumers from fraudulent, misleading, and other harmful practices involving telecommunications, such as slamming.” SIA's description of these two Enforcement Bureau divisions underestimates the range of issues that they investigate. EchoStar argues that the Office of Engineering & Technology's regulatory work suggests that “no more than 7 percent of the applicable FTEs for the OET should be allocated to space-related IB licensees.” This proposal raised by SIA and EchoStar involves more than an analysis of two divisions and one office but rather would require an assessment of how all work done by FTEs in a bureau or office not classified as a core bureau could be associated with the work of a core bureau, such that additional FTEs could be allocated to the core bureau. However, FTEs are assigned as indirect in our regulatory fee calculation where the FTEs work on a variety of issues that cannot be attributed to one particular type of industry or regulatee at this time.

19. The Enforcement Bureau and Consumer & Governmental Affairs FTEs and other indirect FTEs, such as those in the Office of Engineering & Technology, work on a wide range of matters, not all directly assignable to a particular core bureau. We recognize that before the Enforcement Bureau was created, the core bureaus each had an enforcement division and those FTEs would have been assigned to those core bureaus. Currently, however, most enforcement activity is consolidated into the Enforcement Bureau, therefore the FTEs may work on a range of issues and many of their investigations cannot be assigned to a specific core bureau, e.g., investigations that involve more than one service. While SIA suggests that we might track informal complaints filed in the Consumer & Governmental Affairs Bureau and associate them with a core licensing bureau based on the number of informal complaints in each category over a certain time period, we find that this would not be feasible at this time because the types of informal complaints can vary considerably and often cover areas that are not specifically correlated with one core bureau, e.g., billing issues for bundled services. For these reasons, we conclude that reallocating indirect FTEs as direct as suggested by EchoStar and SIA is not feasible at this time. However, we will continue to analyze this issue in future regulatory fee proceedings.

b. Request To Associate Direct FTEs With a Different Core Bureau

20. NAB notes that the FTEs in the Media Bureau who work on issues pertaining to the upcoming spectrum incentive auction to repurpose broadcast television spectrum to wireless use should be reallocated to the Wireless Telecommunications Bureau for regulatory fee purposes. SIA asks us to “re-evaluate whether it is appropriate to exclude auction FTEs in assessing direct costs.” FTE time devoted to developing and implementing the upcoming spectrum incentive auction-direct and indirect costs-is not included in the calculation of fees and is not offset by the collection of regulatory fees. Instead, time devoted to developing and implementing the incentive auction is tracked separately from other work performed by Media Bureau and other FTEs and is offset by the auction proceeds that the Commission is permitted to retain pursuant to section 309(j)(8) of the Communications Act and the Commission's annual appropriation statute. Thus, the Commission is unable, as a legal matter, to implement these proposals.

6. DBS Rate Issues

21. In the FY 2015 NPRM, we sought comment on setting the initial rate for DBS regulatory fees, as a subset of the cable television and IPTV category, at 12 cents per year, or one cent per month. Several commenters contend that we should require DBS operators to pay the same rate as cable television and IPTV. DBS commenters contend that paying the same rate as cable television/IPTV would cause “rate shock” and if we adopt a fee it should be 12 cents as proposed.

22. When adopting the new regulatory fee subcategory for DBS within the cable and IPTV category, we determined a variety of regulatory developments have increased the amount of regulatory activity by the Media Bureau FTEs involving regulation and oversight of MVPDs, including DBS providers. For example, DBS providers (and cable television operators) are permitted to file program access complaints and complaints seeking relief under the retransmission consent good faith rules. In addition, DBS providers are subject to MVPD requirements such as those pertaining to program carriage and the requirement to negotiate retransmission consent in good faith. More recently, the Commission adopted a host of requirements that apply to all MVPDs and thus equally apply to DBS providers as part of its implementation of the Commercial Advertisement Loudness Mitigation Act (CALM Act), the Twenty-First Century Communications and Video Accessibility Act of 2010 (CVAA), as well as the Satellite Television Extension and Localism Act (STELA) Reauthorization Act of 2014 (STELAR). Moreover, we recognize that FY 2015 would be the first time the Commission would be applying this regulatory fee subcategory for DBS. Thus, for the above reasons, we find that for FY 2015 the proposed rate of 12 cents per subscriber per year is a sensible fee supported by data and analysis. In the FY 2016 regulatory fee proceeding, we will update this rate for future years, based on relevant information, as necessary for ensuring an appropriate level of regulatory parity and considering the resources dedicated to this new regulatory fee subcategory.

7. Other Rate Issues

23. Aviation Ground Licenses. In the FY 2015 NPRM, we proposed an increase in regulatory fees for aviation ground licenses. Commenters contend that we have proposed an unjustified and disproportionate fee increase for aviation ground licensees. The Aviation Joint Commenters disagree with our contention that the payment units should be adjusted and they observe that we failed to explain why the revenue requirement was increased. These commenters observe that despite no increase in regulation of this industry, the Commission has significantly increased the regulatory fees in FY 2014 and FY 2015. We agree with the Aviation Joint Commenters and, after reviewing additional information, have adjusted the payment units and rate accordingly based on current fiscal year renewals.

24. Satellite. Several commenters have raised issues pertaining to the proposed space station fees. SIA and EchoStar object to the proposed increase in fees, contending that we should cap any increases at 7.5 percent. These commenters argue that we should adopt the same cap we adopted for FY 2013. In FY 2013, the 7.5% cap was instituted to address the initial changes in the FTE allocations (not fee rate changes resulting from changes in the unit counts) as a result of GAO recommendations. Such FTE allocation changes could have caused some regulatory fee rates to increase dramatically. To address this issue, the Commission capped the fee rate increase to 7.5% from the prior year. In the current proceeding, some satellite commenters requested that the Commission adopt a 7.5% cap on FY 2015 regulatory fee increases as the Commission did in FY 2013 with respect to the Non-Geostationary Space Station fee category. Although the circumstances in which we instituted the cap in FY 2013 are different than now, any discussion of imposing a cap at this time is not necessary because the satellite fee rate in the FY 2015 Report and Order is nearly the same or slightly lower than in FY 2014. We therefore decline to adopt a cap in this instance.

25. Intelsat asks that we take satellite application fees into consideration in calculating our regulatory fees. We are required to assess and collect $339,844,000 in regulatory fees for FY 2015, pursuant to Section 9 of the Communications Act and the Commission's FY 2015 Appropriation. Thus, we are not able to collect less than mandated by Congress in order to take into account section 8 application fees, as Intelsat requests.

26. In addition, Intelsat argues that U.S.-licensed satellite operators should not have to subsidize the non-U.S.-licensed satellite operators' ability to serve the U.S. market. We have sought comment previously on this issue because the number of International Bureau FTEs working on non-U.S.-licensed space stations increases the regulatory fees for the International Bureau regulatees. We also note that non-U.S.-licensed space stations that have been granted access to the U.S. market will eventually communicate with earth stations in the United States, and therefore aspects of the interrelated communications system are apportioned to earth station licensees when accounting for FTE time spent processing requests to access the non-U.S. licensed space station. We conclude that due to: (i) The time spent by International Bureau FTEs in working on these issues; and (ii) the significant number of requests to access the U.S. market by non-U.S.-licensed space stations, the FTEs working on petitions or other matters involving non-U.S.-licensed space stations should be removed from the regulatory fee assessments for U.S.-licensed space stations and considered indirect for regulatory fee purposes. Non-U.S.-licensed space stations granted access to the market in the United States provide a variety of services. Attributing such FTE work as indirect appropriately attributes the regulatory fee burden to the wider telecommunications industry that benefits from such grants of market access. We have reviewed the number of FTEs working on the non-U.S.-licensed space stations and have determined that approximately four FTEs are devoted to this work at this time, therefore, we are reallocating four International Bureau FTEs as indirect FTEs for regulatory fee purposes.

8. Puerto Rico Broadcasters Association Petition

27. In the FY 2015 NPRM, we sought comment on the petition filed by the Puerto Rico Broadcaster's Association (PRBA) seeking regulatory fee relief. We recognize the challenging circumstances described in the PRBA petition. Due to the complexities of this proposal and time constraints imposed by the annual regulatory fee process, additional time is needed to further consider this petition. We intend to address the PRBA petition in a separate proceeding outside of the regulatory fee rulemaking process. We understand that PRBA is contending that the costs associated with preparing and filing a waiver request would be overly burdensome. We do not agree that PRBA's assertion, that requesting a waiver is a burden, eliminates that option. Our waiver process, is available to PRBA members and any aggrieved party seeking a waiver of our rules.

9. Effective Date of Elimination of the Vanity Call Sign and General Mobile Radio Service Regulatory Fee

28. In the Commission's FY 2015 Fee Reform Report and Order, the Commission eliminated the regulatory fee component of two fee categories: amateur radio Vanity Call Signs and General Mobile Radio Service (GMRS). The elimination of regulatory fee categories constitutes a “permitted amendment” as defined in section 9(b)(3) of the Act. As required by section 9(b)(4)(B) of the Act, “permitted amendment” letters dated June 4, 2015 were mailed to congressional officials informing them of the elimination of these two fee categories and adoption of the new DBS fee category. Consistent with section 9(b)(4)(B) of the Act, these amendments will take effect 90 days after congressional notification of the permitted amendment letter, dated June 4, 2015. Thus, effective September 3, 2015, the Vanity Call Sign and GMRS regulatory fee categories will be eliminated and licensees will not be required to pay additional regulatory fees for these licenses. Regulatees are still responsible for the payment of all application fees associated with these licenses.

V. Procedural Matters

A. Payment of Regulatory Fees

1. Payments by Check Will Not Be Accepted for Payment of Annual Regulatory Fees

29. Pursuant to an Office of Management and Budget (OMB) directive, the Commission is moving towards a paperless environment, extending to disbursement and collection of select federal government payments and receipts. The initiative to reduce paper and curtail check payments for regulatory fees is expected to produce cost savings, reduce errors, and improve efficiencies across government. Accordingly, the Commission will no longer accept checks (including cashier's checks and money orders) and the accompanying hardcopy forms (e.g., Forms 159, 159-B, 159-E, 159-W) for the payment of regulatory fees. This new paperless procedure will require that all payments be made by online ACH payment, online credit card, or wire transfer. Any other form of payment (e.g., checks, cashier's checks, or money orders) will be rejected. For payments by wire, a Form 159-E should still be transmitted via fax so that the Commission can associate the wire payment with the correct regulatory fee information. This change will affect all payments of regulatory fees.

2. Revised Credit Card Transaction Levels

30. In accordance with U.S. Treasury Announcement No. A-2014-04 (July 2014), the amount that can be charged on a credit card for transactions with federal agencies has been reduced to $24,999.99. Previously, the credit card limit was $49,999.99. This lower transaction amount is effective June 1, 2015. Transactions greater than $24,999.99 will be rejected. This limit applies to single payments or bundled payments of more than one bill. Multiple transactions to a single agency in one day may be aggregated and treated as a single transaction subject to the $24,999.99 limit. Customers who wish to pay an amount greater than $24,999.99 should consider available electronic alternatives such as Visa or MasterCard debit cards, Automated Clearing House (ACH) debits from a bank account, and wire transfers. Each of these payment options is available after filing regulatory fee information in Fee Filer. Further details will be provided regarding payment methods and procedures at the time of FY 2015 regulatory fee collection in Fact Sheets, available at https://www.fcc.gov/regfees .

3. Lock Box Bank

31. During the fee season for collecting FY 2015 regulatory fees, regulatees can pay their fees by credit card through Pay.gov, ACH, debit card, or by wire transfer. Additional payment instructions are posted at http://transition.fcc.gov/fees/regfees.html .

4. Receiving Bank for Wire Payments

32. The receiving bank for all wire payments is the Federal Reserve Bank, New York, New York (TREAS NYC). When making a wire transfer, regulatees must fax a copy of their Fee Filer generated Form 159-E to the Federal Communications Commission at (202) 418-2843 at least one hour before initiating the wire transfer (but on the same business day) so as not to delay crediting their account. Regulatees should discuss arrangements (including bank closing schedules) with their bankers several days before they plan to make the wire transfer to allow sufficient time for the transfer to be initiated and completed before the deadline. Complete instructions for making wire payments are posted at http://transition.fcc.gov/fees/wiretran.html .

5. De Minimis Regulatory Fees

33. Regulatees whose total FY 2015 annual regulatory fee liability, including all categories of fees for which payment is due, is $500 or less are exempt from payment of FY 2015 regulatory fees. The de minimis threshold applies only to filers of annual regulatory fees (not regulatory fees paid through multi-year filings), and it is not a permanent exemption. Rather, each regulate will need to reevaluate their total fee liability each fiscal year to determine whether they meet the de minimis exemption.

6. Standard Fee Calculations and Payment Dates

34. The Commission will accept fee payments made in advance of the window for the payment of regulatory fees. The responsibility for payment of fees by service category is as follows:

• Media Services: Regulatory fees must be paid for initial construction permits that were granted on or before October 1, 2014 for AM/FM radio stations, VHF/UHF full service television stations, and satellite television stations. Regulatory fees must be paid for all broadcast facility licenses granted on or before October 1, 2014. For providers of Direct Broadcast Service (DBS) service, regulatory fees should be paid based on a subscriber count on or about December 31, 2014. In instances where a permit or license is transferred or assigned after October 1, 2014, responsibility for payment rests with the holder of the permit or license as of the fee due date.
• Wireline (Common Carrier) Services: Regulatory fees must be paid for authorizations that were granted on or before October 1, 2014. In instances where a permit or license is transferred or assigned after October 1, 2014, responsibility for payment rests with the holder of the permit or license as of the fee due date. Audio bridging service providers are included in this category. For Responsible Organizations (RespOrgs) that manage Toll Free Numbers (TFN), regulatory fees should be paid on all working, assigned, and reserved toll free numbers, including those toll free numbers that are in transit status, or any other status as defined in section 52.103 of the Commission's rules. The unit count should be based on toll free numbers managed by RespOrgs on or about December 31, 2014.

• Wireless Services: CMRS cellular, mobile, and messaging services (fees based on number of subscribers or telephone number count): Regulatory fees must be paid for authorizations that were granted on or before October 1, 2014. The number of subscribers, units, or telephone numbers on December 31, 2014 will be used as the basis from which to calculate the fee payment. In instances where a permit or license is transferred or assigned after October 1, 2014, responsibility for payment rests with the holder of the permit or license as of the fee due date.
• Wireless Services, Multi-year fees: The first eight regulatory fee categories in our Schedule of Regulatory Fees pay “small multi-year wireless regulatory fees.” Entities pay these regulatory fees in advance for the entire amount period covered by the five-year or ten-year terms of their initial licenses, and pay regulatory fees again only when the license is renewed or a new license is obtained. We include these fee categories in our rulemaking (see Table B) to publicize our estimates of the number of “small multi-year wireless” licenses that will be renewed or newly obtained in FY 2015.
• Multichannel Video Programming Distributor Services (cable television operators and CARS licensees): Regulatory fees must be paid for the number of basic cable television subscribers as of December 31, 2014. Regulatory fees also must be paid for CARS licenses that were granted on or before October 1, 2014. In instances where a permit or license is transferred or assigned after October 1, 2014, responsibility for payment rests with the holder of the permit or license as of the fee due date.

• International Services: Regulatory fees must be paid for (1) earth stations and (2) geostationary orbit space stations and non-geostationary orbit satellite systems that were licensed and operational on or before October 1, 2014. In instances where a permit or license is transferred or assigned after October 1, 2014, responsibility for payment rests with the holder of the permit or license as of the fee due date.
• International Services: (Submarine Cable Systems): Regulatory fees for submarine cable systems are to be paid on a per cable landing license basis based on circuit capacity as of December 31, 2014. In instances where a license is transferred or assigned after October 1, 2014, responsibility for payment rests with the holder of the license as of the fee due date. For regulatory fee purposes, the allocation in FY 2015 will remain at 87.6 percent for submarine cable and 12.4 percent for satellite/terrestrial facilities.
• International Services: (Terrestrial and Satellite Services): Regulatory fees for Terrestrial and Satellite International Bearer Circuits are to be paid by facilities-based common carriers that have active (used or leased) international bearer circuits as of December 31, 2014 in any terrestrial or satellite transmission facility for the provision of service to an end user or resale carrier. When calculating the number of such active circuits, the facilities-based common carriers must include circuits used by themselves or their affiliates. In addition, non-common carrier satellite operators must pay a fee for each circuit they and their affiliates hold and each circuit sold or leased to any customer, other than an international common carrier authorized by the Commission to provide U.S. international common carrier services. For these purposes, “active circuits” include backup and redundant circuits as of December 31, 2014. Whether circuits are used specifically for voice or data is not relevant for purposes of determining that they are active circuits. In instances where a permit or license is transferred or assigned after October 1, 2014, responsibility for payment rests with the holder of the permit or license as of the fee due date. For regulatory fee purposes, the allocation in FY 2015 will remain at 87.6 percent for submarine cable and 12.4 percent for satellite/terrestrial facilities.

B. Commercial Mobile Radio Service (CMRS) Cellular and Mobile Services Assessments

35. The Commission will compile data from the Numbering Resource Utilization Forecast (NRUF) report that is based on “assigned” telephone number (subscriber) counts that have been adjusted for porting to net Type 0 ports (“in” and “out”). This information of telephone numbers (subscriber count) will be posted on the Commission's electronic filing and payment system (Fee Filer) along with the carrier's Operating Company Numbers (OCNs).

36. A carrier wishing to revise its telephone number (subscriber) count can do so by accessing Fee Filer and follow the prompts to revise their telephone number counts. Any revisions to the telephone number counts should be accompanied by an explanation or supporting documentation. The Commission will then review the revised count and supporting documentation and either approve or disapprove the submission in Fee Filer. If the submission is disapproved, the Commission will contact the provider to afford the provider an opportunity to discuss its revised subscriber count and/or provide additional supporting documentation. If we receive no response from the provider, or we do not reverse our initial disapproval of the provider's revised count submission, the fee payment must be based on the number of subscribers listed initially in Fee Filer. Once the timeframe for revision has passed, the telephone number counts are final and are the basis upon which CMRS regulatory fees are to be paid. Providers can view their final telephone counts online in Fee Filer. A final CMRS assessment letter will not be mailed out.

37. Because some carriers do not file the NRUF report, they may not see their telephone number counts in Fee Filer. In these instances, the carriers should compute their fee payment using the standard methodology that is currently in place for CMRS Wireless services (i.e., compute their telephone number counts as of December 31, 2014), and submit their fee payment accordingly. Whether a carrier reviews its telephone number counts in Fee Filer or not, the Commission reserves the right to audit the number of telephone numbers for which regulatory fees are paid. In the event that the Commission determines that the number of telephone numbers that are paid is inaccurate, the Commission will bill the carrier for the difference between what was paid and what should have been paid.

C. Enforcement

38. To be considered timely, regulatory fee payments must be made electronically by the payment due date for regulatory fees. Section 9(c) of the Act requires us to impose a late payment penalty of 25 percent of the unpaid amount to be assessed on the first day following the deadline for filing these fees. Failure to pay regulatory fees and/or any late penalty will subject regulatees to sanctions, including those set forth in section 1.1910 of the Commission's rules, which generally requires the Commission to withhold action on “applications, including on a petition for reconsideration or any application for review of a fee determination, or requests for authorization by any entity found to be delinquent in its debt to the Commission” and in the DCIA. We also assess administrative processing charges on delinquent debts to recover additional costs incurred in processing and handling the debt pursuant to the DCIA and section 1.1940(d) of the Commission's rules. These administrative processing charges will be assessed on any delinquent regulatory fee, in addition to the 25 percent late charge penalty. In the case of partial payments (underpayments) of regulatory fees, the payor will be given credit for the amount paid, but if it is later determined that the fee paid is incorrect or not timely paid, then the 25 percent late charge penalty (and other charges and/or sanctions, as appropriate) will be assessed on the portion that is not paid in a timely manner.

39. Pursuant to the “red light rule,” we will withhold action on any applications or other requests for benefits filed by anyone who is delinquent in any non-tax debts owed to the Commission (including regulatory fees) and will ultimately dismiss those applications or other requests if payment of the delinquent debt or other satisfactory arrangement for payment is not made. Failure to pay regulatory fees can also result in the initiation of a proceeding to revoke any and all authorizations held by the entity responsible for paying the delinquent fee(s). Pursuant to a pilot program, we have initiated procedures to transfer debt to the Centralized Receivables Service at the U.S. Treasury, as described below.

D. Transfers of Unpaid Debt to Centralized Receivables Service, U.S. Treasury

40. Under section 9 of the Act, Commission's rules, and federal debt collection laws, a licensee's regulatory fee is due on the first day of the fiscal year and payable at a date established in the Commission's annual regulatory fee Report and Order. Beginning on or after October 1, 2015, under revised procedures, the Commission will begin transferring unpaid regulatory fee receivables directly to the CRS at the U.S. Treasury instead of working to collect the debt and then transferring the remaining unpaid debts to Treasury. The Commission can transfer delinquent debt to Treasury for further collection action within 120 days after the date of delinquency. We anticipate that the transfer of FY 2015 debts to Treasury will occur much sooner than our current process. Regulatees, however, will not likely see any substantial change in the current procedures of how past due debts are to be paid, except that the debts will be handled by CRS (U.S. Treasury) rather than by the Commission.

E. Effective Date

41. Providing a 30 day period after Federal Register publication before this Report and Order becomes effective as required by 5 U.S.C. 553(d) will not allow sufficient time for the Commission to collect the FY 2015 fees before FY 2015 ends on September 30, 2015. For this reason, pursuant to 5 U.S.C. 553(d)(3), the Commission finds there is good cause to waive the requirements of section 553(d), and this Report and Order and Further Notice of Proposed Rulemaking will become effective upon publication in the Federal Register. Because payments of the regulatory fees will not actually be due until the middle of September, persons affected by this Report and Order will still have a reasonable period in which to make their payments and thereby comply with the rules established herein.

VI. Additional Tables

Table D—Sources of Payment Unit Estimates for FY 2015

In order to calculate individual service fees for FY 2015, we adjusted FY 2014 payment units for each service to more accurately reflect expected FY 2015 payment liabilities. We obtained our updated estimates through a variety of means. For example, we used Commission licensee data bases, actual prior year payment records and industry and trade association projections when available. The databases we consulted include our Universal Licensing System (ULS), International Bureau Filing System (IBFS), Consolidated Database System (CDBS) and Cable Operations and Licensing System (COALS), as well as reports generated within the Commission such as the Wireless Telecommunications Bureau's Numbering Resource Utilization Forecast report.

We sought verification for these estimates from multiple sources and, in all cases, we compared FY 2015 estimates with actual FY 2014 payment units to ensure that our revised estimates were reasonable. Where appropriate, we adjusted and/or rounded our final estimates to take into consideration the fact that certain variables that impact on the number of payment units cannot yet be estimated with sufficient accuracy. These include an unknown number of waivers and/or exemptions that may occur in FY 2015 and the fact that, in many services, the number of actual licensees or station operators fluctuates from time to time due to economic, technical, or other reasons. When we note, for example, that our estimated FY 2015 payment units are based on FY 2014 actual payment units, it does not necessarily mean that our FY 2015 projection is exactly the same number as in FY 2014. We have either rounded the FY 2015 number or adjusted it slightly to account for these variables.

Table E—Factors, Measurements, and Calculations That Determines Station Signal Contours and Associated Population Coverages

AM Stations

For stations with nondirectional daytime antennas, the theoretical radiation was used at all azimuths. For stations with directional daytime antennas, specific information on each day tower, including field ratio, phase, spacing, and orientation was retrieved, as well as the theoretical pattern root-mean-square of the radiation in all directions in the horizontal plane (RMS) figure (milliVolt per meter (mVm) @1 km) for the antenna system. The standard, or augmented standard if pertinent, horizontal plane radiation pattern was calculated using techniques and methods specified in sections 73.150 and 73.152 of the Commission's rules. Radiation values were calculated for each of 360 radials around the transmitter site. Next, estimated soil conductivity data was retrieved from a database representing the information in FCC Figure R3. Using the calculated horizontal radiation values, and the retrieved soil conductivity data, the distance to the principal community (5 mVm) contour was predicted for each of the 360 radials. The resulting distance to principal community contours were used to form a geographical polygon. Population counting was accomplished by determining which 2010 block centroids were contained in the polygon. (A block centroid is the center point of a small area containing population as computed by the U.S. Census Bureau.) The sum of the population figures for all enclosed blocks represents the total population for the predicted principal community coverage area.

FM Stations

The greater of the horizontal or vertical effective radiated power (ERP) (kW) and respective height above average terrain (HAAT) (m) combination was used. Where the antenna height above mean sea level (HAMSL) was available, it was used in lieu of the average HAAT figure to calculate specific HAAT figures for each of 360 radials under study. Any available directional pattern information was applied as well, to produce a radial-specific ERP figure. The HAAT and ERP figures were used in conjunction with the Field Strength (50-50) propagation curves specified in 47 CFR 73.313 of the Commission's rules to predict the distance to the principal community (70 dBu (decibel above 1 microVolt per meter) or 3.17 mVm) contour for each of the 360 radials. The resulting distance to principal community contours were used to form a geographical polygon. Population counting was accomplished by determining which 2010 block centroids were contained in the polygon. The sum of the population figures for all enclosed blocks represents the total population for the predicted principal community coverage area.

VII. Regulatory Flexibility Analysis

1. As required by the Regulatory Flexibility Act of 1980, as amended (RFA), an Initial Regulatory Flexibility Analysis (IRFA) was included in the Notice of Proposed Rulemaking. The Commission sought written public comment on these proposals including comment on the IRFA. This Final Regulatory Flexibility Analysis (FRFA) conforms to the IRFA.

A. Need for, and Objectives of, the Report and Order

2. In this Report and Order, we conclude the Assessment and Collection of Regulatory Fees for Fiscal Year (FY) 2015 proceeding to collect $339,844,000 in regulatory fees for FY 2015, pursuant to section 9 of the Communications Act of 1934, as amended. These regulatory fees will be due in September 2015. Under section 9 of the Communications Act, regulatory fees are mandated by Congress and collected to recover the regulatory costs associated with the Commission's enforcement, policy and rulemaking, user information, and international activities in an amount that can be reasonably expected to equal the amount of the Commission's annual appropriation.

3. This FY 2015 Report and Order adopts a regulatory fee schedule that includes the following noteworthy changes from prior years: (1) A reduction in regulatory fees for the submarine cable/terrestrial and satellite bearer circuit category relative to other fee categories in the International Bureau; (2) the first fee rate for Direct Broadcast Satellite (DBS) as a subcategory of the cable television and Internet Protocol Television (IPTV) regulatory fee category; (3) the first fee rate for toll free numbers; and (4) the elimination of the regulatory fee component of two fee categories: Amateur Radio Vanity Call Signs and General Mobile Radio Service (GMRS). In addition, in calculating the FY 2015 fee schedule, the Commission also reallocated four International Bureau full time employees (FTEs) as indirect.

4. With respect to the submarine cable/terrestrial and satellite bearer circuit fee category, after additional review, the Commission concluded that the fee assessed on the submarine cable/terrestrial and satellite bearer circuit fee category was excessive relative to the Commission's oversight and regulation of this industry. As a result, the Commission reduced the percentage of total fees paid by this fee category by 7.5 percent. With respect to the DBS fee category, the Commission instituted the DBS fee after realizing that Media Bureau resources were being used to address DBS and MVPD issues, but these costs were not being recovered from DBS providers. Therefore, the DBS fee is instituted to recover the cost of Media Bureau resources that is spent on MVPD and DBS issues. Similarly, a toll free number regulatory fee is instituted to recover the cost of resources expended by the Wireline Bureau on issues relating to toll free numbers. With respect to Amateur Radio Vanity Call Signs and General Mobile Radio Service (GMRS), the Commission concluded that the administrative costs of processing, reviewing, and enforcing the thousands of Vanity Call Sign and GMRS licenses far exceeds the $21.40 and $25 per license regulatory fee rate that is collected, respectively. Many of the Amateur Vanity Call Signs and GMRS licensees are small businesses and/or individuals. Finally, in calculating the FY 2015 fee schedule, the Commission reallocated four International Bureau full time employees (FTEs) as indirect to reflect work performed by International Bureau staff on non-U.S.-licensed space stations, who are not required to pay regulatory fees.

B. Summary of the Significant Issues Raised by the Public Comments in Response to the IRFA

5. None.

C. Description and Estimate of the Number of Small Entities to Which the Rules Will Apply

6. The RFA directs agencies to provide a description of, and where feasible, an estimate of the number of small entities that may be affected by the proposed rules and policies, if adopted. The RFA generally defines the term “small entity” as having the same meaning as the terms “small business,” “small organization,” and “small governmental jurisdiction.” In addition, the term “small business” has the same meaning as the term “small business concern” under the Small Business Act. A “small business concern” is one which: (1) Is independently owned and operated; (2) is not dominant in its field of operation; and (3) satisfies any additional criteria established by the SBA. Nationwide, there are a total of approximately 27.9 million small businesses, according to the SBA.

1. Wired Telecommunications Carriers. The U.S. Census Bureau defines this industry as “establishments primarily engaged in operating and/or providing access to transmission facilities and infrastructure that they own and/or lease for the transmission of voice, data, text, sound, and video using wired communications networks. Transmission facilities may be based on a single technology or a combination of technologies. Establishments in this industry use the wired telecommunications network facilities that they operate to provide a variety of services, such as wired telephony services, including VoIP services, wired (cable) audio and video programming distribution, and wired broadband internet services. By exception, establishments providing satellite television distribution services using facilities and infrastructure that they operate are included in this industry.” The SBA has developed a small business size standard for Wired Telecommunications Carriers, which consists of all such companies having 1,500 or fewer employees. Census data for 2007 shows that there were 3,188 firms that operated that year. Of this total, 3,144 operated with less than 1,000 employees. Thus, under this size standard, the majority of firms in this industry can be considered small.

2. Local Exchange Carriers (LECs). Neither the Commission nor the SBA has developed a size standard for small businesses specifically applicable to local exchange services. The closest applicable NAICS Code category is Wired Telecommunications Carriers as defined in paragraph 6 of this FRFA. Under the applicable SBA size standard, such a business is small if it has 1,500 or fewer employees. According to Commission data, census data for 2007 shows that there were 3,188 firms that operated that year. Of this total, 3,144 operated with fewer than 1,000 employees. The Commission therefore estimates that most providers of local exchange carrier service are small entities that may be affected by the rules adopted.

3. Incumbent LECs. Neither the Commission nor the SBA has developed a small business size standard specifically for incumbent local exchange services. The closest applicable NAICS Code category is Wired Telecommunications Carriers as defined in paragraph 6 of this FRFA. Under that size standard, such a business is small if it has 1,500 or fewer employees. According to Commission data, 3,188 firms operated in that year. Of this total, 3,144 operated with fewer than 1,000 employees. Consequently, the Commission estimates that most providers of incumbent local exchange service are small businesses that may be affected by the rules and policies adopted. Three hundred and seven (307) Incumbent Local Exchange Carriers reported that they were incumbent local exchange service providers. Of this total, an estimated 1,006 have 1,500 or fewer employees.

4. Competitive Local Exchange Carriers (Competitive LECs), Competitive Access Providers (CAPs), Shared-Tenant Service Providers, and Other Local Service Providers. Neither the Commission nor the SBA has developed a small business size standard specifically for these service providers. The appropriate NAICS Code category is Wired Telecommunications Carriers, as defined in paragraph 6 of this FRFA. Under that size standard, such a business is small if it has 1,500 or fewer employees. U.S. Census data for 2007 indicate that 3,188 firms operated during that year. Of that number, 3,144 operated with fewer than 1,000 employees. Based on this data, the Commission concludes that the majority of Competitive LECS, CAPs, Shared-Tenant Service Providers, and Other Local Service Providers, are small entities. According to Commission data, 1,442 carriers reported that they were engaged in the provision of either competitive local exchange services or competitive access provider services. Of these 1,442 carriers, an estimated 1,256 have 1,500 or fewer employees. In addition, 17 carriers have reported that they are Shared-Tenant Service Providers, and all 17 are estimated to have 1,500 or fewer employees. Also, 72 carriers have reported that they are Other Local Service Providers. Of this total, 70 have 1,500 or fewer employees. Consequently, based on internally researched FCC data, the Commission estimates that most providers of competitive local exchange service, competitive access providers, Shared-Tenant Service Providers, and Other Local Service Providers are small entities that may be affected by the rules adopted.

5. Interexchange Carriers (IXCs). Neither the Commission nor the SBA has developed a definition for Interexchange Carriers. The closest NAICS Code category is Wired Telecommunications Carriers as defined in paragraph 6 of this FRFA. The applicable size standard under SBA rules is that such a business is small if it has 1,500 or fewer employees. U.S. Census data for 2007 indicates that 3,188 firms operated during that year. Of that number, 3,144 operated with fewer than 1,000 employees. According to internally developed Commission data, 359 companies reported that their primary telecommunications service activity was the provision of interexchange services. Of this total, an estimated 317 have 1,500 or fewer employees. Consequently, the Commission estimates that the majority of interexchange service providers are small entities that may be affected by the rules adopted.

6. Prepaid Calling Card Providers. Neither the Commission nor the SBA has developed a small business size standard specifically for prepaid calling card providers. The appropriate NAICS Code category for prepaid calling card providers is Telecommunications Resellers. This industry comprises establishments engaged in purchasing access and network capacity from owners and operators of telecommunications networks and reselling wired and wireless telecommunications services (except satellite) to businesses and households. Mobile virtual networks operators (MVNOs) are included in this industry. Under the applicable SBA size standard, such a business is small if it has 1,500 or fewer employees. U.S. Census data for 2007 show that 1,523 firms provided resale services during that year. Of that number, 1,522 operated with fewer than 1,000 employees. Thus, under this category and the associated small business size standard, the majority of these prepaid calling card providers can be considered small entities. According to Commission data, 193 carriers have reported that they are engaged in the provision of prepaid calling cards. All 193 carriers have 1,500 or fewer employees. Consequently, the Commission estimates that the majority of prepaid calling card providers are small entities that may be affected by the rules adopted.

7. Local Resellers. The SBA has developed a small business size standard for the category of Telecommunications Resellers. Under that size standard, such a business is small if it has 1,500 or fewer employees. Census data for 2007 show that 1,523 firms provided resale services during that year. Of that number, 1,522 operated with fewer than 1,000 employees. Under this category and the associated small business size standard, the majority of these local resellers can be considered small entities. According to Commission data, 213 carriers have reported that they are engaged in the provision of local resale services. Of this total, an estimated 211 have 1,500 or fewer employees. Consequently, the Commission estimates that the majority of local resellers are small entities that may be affected by the rules adopted.

8. Toll Resellers. The Commission has not developed a definition for Toll Resellers. The closest NAICS Code Category is Telecommunications Resellers, and the SBA has developed a small business size standard for the category of Telecommunications Resellers. Under that size standard, such a business is small if it has 1,500 or fewer employees. Census data for 2007 show that 1,523 firms provided resale services during that year. Of that number, 1,522 operated with fewer than 1,000 employees. Thus, under this category and the associated small business size standard, the majority of these resellers can be considered small entities. According to Commission data, 881 carriers have reported that they are engaged in the provision of toll resale services. Of this total, an estimated 857 have 1,500 or fewer employees. Consequently, the Commission estimates that the majority of toll resellers are small entities that may be affected by the rules adopted.

9. Other Toll Carriers. Neither the Commission nor the SBA has developed a definition for small businesses specifically applicable to Other Toll Carriers. This category includes toll carriers that do not fall within the categories of interexchange carriers, operator service providers, prepaid calling card providers, satellite service carriers, or toll resellers. The closest applicable NAICS Code category is for Wired Telecommunications Carriers as defined in paragraph 6 of this FRFA. Under the applicable SBA size standard, such a business is small if it has 1,500 or fewer employees. Census data for 2007 shows that there were 3,188 firms that operated that year. Of this total, 3,144 operated with fewer than 1,000 employees. Thus, under this category and the associated small business size standard, the majority of Other Toll Carriers can be considered small. According to internally developed Commission data, 284 companies reported that their primary telecommunications service activity was the provision of other toll carriage. Of these, an estimated 279 have 1,500 or fewer employees. Consequently, the Commission estimates that most Other Toll Carriers are small entities that may be affected by the rules and policies adopted.

10. Wireless Telecommunications Carriers (except Satellite). This industry comprises establishments engaged in operating and maintaining switching and transmission facilities to provide communications via the airwaves, such as cellular services, paging services, wireless internet access, and wireless video services. The appropriate size standard under SBA rules is that such a business is small if it has 1,500 or fewer employees. For this industry, Census data for 2007 show that there were 1,383 firms that operated for the entire year. Of this total, 1,368 firms had fewer than 1,000 employees. Thus under this category and the associated size standard, the Commission estimates that the majority of wireless telecommunications carriers (except satellite) are small entities. Similarly, according to internally developed Commission data, 413 carriers reported that they were engaged in the provision of wireless telephony, including cellular service, Personal Communications Service (PCS), and Specialized Mobile Radio (SMR) services. Of this total, an estimated 261 have 1,500 or fewer employees. Consequently, the Commission estimates that approximately half of these firms can be considered small. Thus, using available data, we estimate that the majority of wireless firms can be considered small.

11. Cable Television and Other Subscription Programming. Since 2007, these services have been defined within the broad economic census category of Wired Telecommunications Carriers. That category is defined as follows: “This industry comprises establishments primarily engaged in operating andor providing access to transmission facilities and infrastructure that they own andor lease for the transmission of voice, data, text, sound, and video using wired telecommunications networks. Transmission facilities may be based on a single technology or a combination of technologies.” The SBA has developed a small business size standard for this category, which is: All such firms having 1,500 or fewer employees. Census data for 2007 shows that there were 3,188 firms that operated that year. Of this total, 3,144 had fewer than 1,000 employees. Thus under this size standard, the majority of firms offering cable and other program distribution services can be considered small and may be affected by rules adopted.

12. Cable Companies and Systems. The Commission has developed its own small business size standards for the purpose of cable rate regulation. Under the Commission's rules, a “small cable company” is one serving 400,000 or fewer subscribers nationwide. Industry data indicate that there are currently 4,600 active cable systems in the United States. Of this total, all but ten cable operators nationwide are small under the 400,000-subscriber size standard. In addition, under the Commission's rate regulation rules, a “small system” is a cable system serving 15,000 or fewer subscribers. Current Commission records show 4,600 cable systems nationwide. Of this total, 3,900 cable systems have less than 15,000 subscribers, and 700 systems have 15,000 or more subscribers, based on the same records. Thus, under this standard as well, we estimate that most cable systems are small entities.

13. Cable System Operators (Telecom Act Standard). The Communications Act of 1934, as amended, also contains a size standard for small cable system operators, which is “a cable operator that, directly or through an affiliate, serves in the aggregate fewer than 1 percent of all subscribers in the United States and is not affiliated with any entity or entities whose gross annual revenues in the aggregate exceed $250,000,000.” There are approximately 52,403,705 cable video subscribers in the United States today. Accordingly, an operator serving fewer than 524,037 subscribers shall be deemed a small operator if its annual revenues, when combined with the total annual revenues of all its affiliates, do not exceed $250 million in the aggregate. Based on available data, we find that all but nine incumbent cable operators are small entities under this size standard. We note that the Commission neither requests nor collects information on whether cable system operators are affiliated with entities whose gross annual revenues exceed $250 million. Although it seems certain that some of these cable system operators are affiliated with entities whose gross annual revenues exceed $250,000,000, we are unable at this time to estimate with greater precision the number of cable system operators that would qualify as small cable operators under the definition in the Communications Act.

14. All Other Telecommunications. “All Other Telecommunications” is defined as follows: This U.S. industry is comprised of establishments that are primarily engaged in providing specialized telecommunications services, such as satellite tracking, communications telemetry, and radar station operation. This industry also includes establishments primarily engaged in providing satellite terminal stations and associated facilities connected with one or more terrestrial systems and capable of transmitting telecommunications to, and receiving telecommunications from, satellite systems. Establishments providing Internet services or voice over Internet protocol (VoIP) services via client-supplied telecommunications connections are also included in this industry. The SBA has developed a small business size standard for “All Other Telecommunications,” which consists of all such firms with gross annual receipts of $32.5 million or less. For this category, census data for 2007 show that there were 2,383 firms that operated for the entire year. Of these firms, a total of 2,346 had gross annual receipts of less than $25 million. Thus, a majority of “All Other Telecommunications” firms potentially affected by the rules adopted can be considered small.

D. Description of Projected Reporting, Recordkeeping and Other Compliance Requirements

15. This Report and Order does not adopt any new reporting, recordkeeping, or other compliance requirements.

E. Steps Taken To Minimize Significant Economic Impact on Small Entities, and Significant Alternatives Considered

16. The RFA requires an agency to describe any significant alternatives that it has considered in reaching its approach, which may include the following four alternatives, among others: (1) The establishment of differing compliance or reporting requirements or timetables that take into account the resources available to small entities; (2) the clarification, consolidation, or simplification of compliance or reporting requirements under the rule for small entities; (3) the use of performance, rather than design, standards; and (4) an exemption from coverage of the rule, or any part thereof, for small entities.

17. This Report and Order does not adopt any new reporting requirements. Therefore no adverse economic impact on small entities will be sustained based on reporting requirements. There will be a regulatory fee instituted on DBS providers due to the adoption of a new fee category, but we anticipate that the two primary DBS companies required to pay these fees are not small entities. Similarly, a new regulatory fee for Responsible Organizations (Resp. Org) has also been instituted in FY 2015 for the toll free number fee category that was previously adopted—the fee rate adopted is 12 cents per year. This is not a new reporting requirement, and should not have any adverse economic impact on small Resp. Org. entities because they are able to recover these assessed fees from their customers.

18. In keeping with the requirements of the Regulatory Flexibility Act, we have considered certain alternative means of mitigating the effects of fee increases to a particular industry segment. For example, beginning in FY 2015 the Commission has increased the de minimis threshold from under $10 to $500 (the total of all regulatory fees), which will impact many small entities that pay regulatory fees for ITSP, paging, cellular, cable, and Low Power Television/FM Translators. Historically, many of these small entities have been late in making their fee payments to the Commission by the due date. This increase in the de minimis threshold to $500 will relieve regulatees both financially and administratively. Finally, regulatees may also seek waivers or other relief on the basis of financial hardship. See 47 CFR 1.1166.

F. Federal Rules That May Duplicate, Overlap, or Conflict

19. None.

VIII. Ordering Clauses

20. Accordingly, it is ordered that, pursuant to sections 4(i) and (j), 9, and 303(r) of the Communications Act of 1934, as amended, 47 U.S.C. 154(i), 154(j), 159, and 303(r), this Report and Order and Further Notice of Proposed Rulemaking is hereby adopted.

21. It is further ordered that, as provided in paragraph 41, this Report and Order and Further Notice of Proposed Rulemaking shall be effective September 17, 2015.

22. It is further ordered that the Commission's Consumer & Governmental Affairs Bureau, Reference Information Center, shall send a copy of this Report and Order, including the Final Regulatory Flexibility Analysis, to the Chief Counsel for Advocacy of the U.S. Small Business Administration.

List of Subjects in 47 CFR Part 1

• Administrative practice and procedure Lawyers
• Metric system
• Penalties
• Reporting and recordkeeping requirements
• Telecommunications

Rule Changes

For the reasons discussed in the preamble, the Federal Communications Commission amends 47 CFR, part 1 as follows:

PART 1—PRACTICE AND PROCEDURE

1. The authority citation for part 1 continues to read as follows:

Authority: 15 U.S.C. 79, et seq.; 47 U.S.C. 151, 154(i), 154(j), 155, 157, 160, 201, 225, 227, 303, 309, 332, 1403, 1404, 1451, 1452, and 1455.

2. Section 1.1152 is revised to read as follows:

3. Section 1.1153 is revised to read as follows:

4. Section 1.1154 is revised to read as follows:

5. Section 1.1155 is revised to read as follows:

6. Section 1.1156 is revised to read as follows: