Reallocation of the 216-220 MHz, 1390-1395 MHz, 1427-1429 MHz, 1429-1432 MHz, 1432-1435 MHz, 1670-1675 MHz, and 2385-2390 MHz Government Transfer Bands

AGENCY:

Federal Communications Commission.

ACTION:

Proposed rule.

SUMMARY:

In this document, the Commission proposes to establish new service rules for licensing a total of 27 megahertz of spectrum transferred from Government to non-Government use. The Commission seeks comment on the flexibility that should be afforded new or incumbent licensees, and the technical and other service rules that should govern the range of existing and proposed services. The comments will aid the Commission on how best to utilize these bands to provide valuable services to the public. Additionally, the Commission seeks comments on a petition for rulemaking filed on March 6, 2000, by Data Flow Systems, Inc., requesting amendment of the Commission's rules. The Commission also seeks comments on a proposal filed by Securicor Wireless Holdings, Inc.

DATES:

Written comments on the proposed rule are due on or before March 4, 2002, and reply comments are due on or before March 18, 2002.

ADDRESSES:

Parties who choose to file comments by paper must file an original and four copies to William F. Caton, Acting Secretary, Office of the Secretary, Federal Communications Commission, 445 12th St., SW., Room TW-A325, Washington, DC 20554. Comments may also be filed using the Commission's Electronic Filing System, which can be accessed via the Internet at www.fcc.gov/e-file/ecfs.html.

FOR FURTHER INFORMATION CONTACT:

Zenji Nakazawa, Wireless Telecommunications Bureau, at (202) 418-0680, via e-mail at znakazaw@fcc.gov, via TTY (202) 418-7233 or Nese Guendelsberger, Wireless Telecommunications Bureau, Auctions and Industry Analysis Division, at (202) 418-0660.

SUPPLEMENTARY INFORMATION:

This is a summary of the Federal Communications Commission's Notice of Proposed Rule Making, FCC 02-15, adopted on January 22, 2002, and released on February 06, 2002. The full text of this Notice of Proposed Rule Making is available for inspection and copying during normal business hours in the FCC Reference Center, Room CY-A257, 445 12th Street, SW., Washington, DC 20554. The complete text with the summarized band plan chart may be purchased from the Commission's copy contractor, Qualex International, 445 12th Street, SW., Room CY-B402, Washington, DC 20554. The full text may also be downloaded at: www.fcc.gov. Alternative formats are available to persons with disabilities by contacting Brian Millin at (202) 418-7426 or TTY (202) 418-7365.

1. In this Notice of Proposed Rulemaking (NPRM), we propose new service rules for licensing a total of 27 megahertz of spectrum from the 216-220 MHz, 1390-1395 MHz, 1427-1429 MHz, 1429-1432 MHz, 1432-1435 MHz, 1670-1675 MHz, and 2385-2390 MHz bands. This spectrum was transferred from Government to non-Government use pursuant to the provisions of the Omnibus Budget Reconciliation Act of 1993 (OBRA-93) and the Balanced Budget Act of 1997 (BBA-97).

2. The service rules proposed in the NPRM include provisions for licensing, technical (and operating) rules, competitive bidding, and interference standards. We note that portions of this spectrum are currently available and utilized by existing non-Government licensees. We solicit public comment on the flexibility that should be afforded new or incumbent licensees, and the technical and other service rules that should govern the range of existing and proposed services. We also anticipate authorizing new primary services in the paired 1392-1395 MHz and 1432-1435 MHz bands and the unpaired 1390-1392 MHz, 1670-1675 MHz, and 2385-2390 MHz bands.

3. We generally seek comment on the following issues under consideration for all of these bands:

• Whether to authorize new services under part 27 or part 101 of our rules;
• Whether to license new services by geographic service areas;
• Whether to license band managers in any of these bands;
• Whether to provide for partitioning and disaggregation of licensed spectrum; and
• Whether to adopt technical rules in order to prevent in-band and out-of-band interference.

4. We also address several issues relating to existing services currently operating in these bands. We seek comment on the following issues:

• Whether secondary telemetry in the 217-220 MHz and 1427-1429.5 MHz bands should be licensed on a site-by-site basis;
• Whether primary telemetry in the 1429.5-1432 MHz band should be licensed on a site-by-site basis;
• Whether to add technical specifications to Part 90 of our Rules for telemetry operations;
• Whether to apply the frequency coordination procedures of Section 90.175 to authorization of future secondary telemetry operations.

5. Additionally, we propose service rules to augment the framework established in the Reallocation Report and Order, 67 FR 6172, February 11, 2002, ET Docket 00-221, FCC 01-382, that requires non-Federal Government users to coordinate with co-primary Federal Government incumbents. In this regard, we seek comment on the following issues:

• Blanket coordination for LPRS;
• Coordination of site-by-site and geographic area licensees with Federal Government incumbents;
• Coordination procedures for licensees operating in the 1670-1675 MHz band near the METSAT station located at Greenbelt, MD.

6. With respect to non-Government incumbents who will remain in these bands, we seek comment on the following issues:

• Coordination procedures for licensees in the 2385-2390 MHz band operating near non-Government aeronautical flight test telemetry sites;
• Interim coordination procedures for terrestrial licensees along the Canadian and Mexican borders.

7. In accordance with section 309(j) of the Communications Act, if we adopt a licensing scheme under which mutually exclusive applications are accepted for filing, we must resolve such mutually exclusive applications by competitive bidding. We propose to conduct the auction of such licenses in conformity with the general competitive bidding rules set forth in part 1, subpart Q, of the Commission's rules. We also propose the use of bidding credits for small entities that participate in auctions of licenses in the paired 1392-1395 MHz and 1432-1435 MHz bands and the unpaired 1390-1392 MHz, 1670-1675 MHz, and 2385-2390 MHz bands as well as the unpaired 1429.5-1432 MHz portion and seven geographic carved out areas for primary telemetry in the 1427-1429.5 MHz portion of the 1.4 GHz band.

8. Additionally, we seek comment on a petition for rulemaking filed on March 6, 2000, by Data Flow Systems, Inc., requesting that the Commission amend §§ 90.35 and 90.259 of the Commission's Rules to allow the use of fixed telemetry in the 216-220 MHz band. We also seek comment on a proposal filed by Securicor Wireless Holdings, Inc. (Securicor) in response to the Reallocation Notice, 66 FR 7443, January 23, 2001. Securicor seeks to license “white-space” in the 216-220 MHz band similar to the paradigm established for land mobile use of the 220-222 MHz band. Lastly, we request comment on a proposal submitted by Warren Havens (Havens) that seeks the creation of a new “Advanced Technologies 220 MHz” Service in the 216-225 MHz band.

9. In a companion proceeding in ET Docket 00-221, the Commission recently reallocated the spectrum that is the subject of this NPRM. In response to that rulemaking, various parties recommended proposals on how best to utilize these bands to provide valuable services to the public. Because we now consider service rules regarding this spectrum, we hereby incorporate by reference the record previously developed in that proceeding leading to the Reallocation Report and Order.

I. Procedural Matters

10. Ex Parte Rules. For purposes of this permit-but-disclose notice and comment rulemaking proceeding, members of the public are advised that ex parte presentations are permitted, except during the Sunshine Agenda period, provided they are disclosed under the Commission's rules.

11. Pleading Dates. Pursuant to applicable procedures set forth in §§ 1.415 and 1.419 of the Commission's rules, interested parties may file comments on or before March 4, 2002, and reply comments on or before March 18, 2002. Comments and reply comments should be filed in WT Docket No. 02-08. All relevant and timely comments will be considered by the Commission before final action is taken in this proceeding. To file formally in this proceeding, interested parties must file an original and four copies of all comments, reply comments, and supporting comments. If interested parties want each Commissioner to receive a personal copy of their comments, they must file an original plus nine copies. Interested parties should send comments and reply comments to the Office of the Secretary, Federal Communications Commission, Room TW-A325, 445 Twelfth Street, SW., Washington, DC 20554, with a copy to Dana Davis, Wireless Telecommunications Bureau, Room 4-C216, 445 Twelfth Street, SW., Washington, DC 20554.

12. Comments may also be filed using the Commission's Electronic Comment Filing System (ECFS). Comments filed through the ECFS can be sent as an electronic file via the Internet to <http://www.fcc.gov/e-file/ecfs.html>. Generally, only one copy of an electronic submission must be filed. In completing the transmittal screen, commenters should include their full name, Postal Service mailing address, and the applicable docket or rulemaking number. Parties may also submit an electronic comment by Internet e-mail. To obtain filing instructions for e-mail comments, commenters should send an e-mail to ecfs@fcc.gov, and should include the following words in the body of the message, “get form <your e-mail address>.” A sample form and directions will be sent in reply.

13. Comments and reply comments will be available for public inspection during regular business hours at the FCC Reference Information Center, Room CY-A257, at the Federal Communications Commission, 445 Twelfth Street, SW., Washington, DC 20554. Copies of comments and reply comments are available through the Commission's duplicating contractor: Qualex International, Portals II, 445 12th Street, SW., Room CY-B402, Washington, DC, 20554, telephone 202-863-2893, facsimile 202-863-2898, or via e-mail qualexint@aol.com.

II. Initial Regulatory Flexibility Analysis for Notice of Proposed Rule Making

14. As required by the Regulatory Flexibility Act (RFA), the Commission has prepared this present Initial Regulatory Flexibility Analysis (IRFA) of the possible significant economic impact on small entities by the policies and rules proposed in the (NPRM), WT Docket No. 02-08. Written public comments are requested on this IRFA. Comments must be identified as responses to the IRFA and must be filed by the deadlines for comments on the NPRM as provided previously. The Commission will send a copy of the NPRM, including the IRFA, to the Chief Counsel for Advocacy of the Small Business Administration. In addition, the NPRM and IRFA (or summaries thereof) will be published in the Federal Register.

A. Legal Basis for Proposed Rules

15. The proposed action is authorized under sections 1, 4(i), 302, 303(f) and (r), and 332 of the Communications Act of 1934, as amended, 47 U.S.C. 1, 154(i), 302, 303(f) and (r), and 332.

B. Description and Estimate of the Number of Small Entities To Which the Proposed Rules Will Apply

16. 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, if adopted. The RFA 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: (i) Is independently owned and operated; (ii) is not dominant in its field of operation; and (iii) satisfies any additional criteria established by the Small Business Administration (SBA). A small organization is generally “any not-for-profit enterprise which is independently owned and operated and is not dominant in its field.” Nationwide, as of 1992, there were approximately 275,801 small organizations. “Small governmental jurisdiction” generally means “governments of cities, counties, towns, townships, villages, school districts, or special districts, with a population of less than 50,000.” As of 1992, there were approximately 85,006 governmental entities in the United States. This number includes 38,978 counties, cities, and towns; of these, 37,566, or 96%, have populations of fewer than 50,000. The Census Bureau estimates that this ratio is approximately accurate for all governmental entities. Thus, of the 85,006 governmental entities, we estimate that 81,600 (96%) are small entities.

17. With respect to the 1390-1395 MHz, 1432-1435 MHz, 1670-1675 MHz, and 2385-2390 MHz bands, the Commission has not yet determined how many licenses will be awarded and does not know how many licensees will partition their license areas or disaggregate their spectrum blocks, if partitioning and disaggregation are allowed. Moreover, the Commission does not yet know how many applicants or licensees in these bands will be small entities. We therefore assume that, for purposes of our evaluations and conclusions in the IRFA, all prospective licensees are small entities, as that term is defined by the SBA or by our proposed small business definitions for these bands. We invite comment on this analysis.

18. Existing services in other bands include entities that might be affected by the proposed rules, either as existing licensees or potential applicants or licensees. Incumbent services in the 216-220 MHz band include the Automated Maritime Telecommunications Service (AMTS), the “218-219 MHz” Service, the Low Power Radio Service (LPRS) and telemetry. Incumbent services in the 1427-1429.5 MHz and 1429.5-1432 MHz bands include wireless medical telemetry (WMTS) and general telemetry.

19. AMTS. For future auctions in the AMTS, the Commission has proposed to define small businesses as those entities, together with their affiliates and controlling interests, with not more than $15 million in average gross revenues for the preceding three years, and very small businesses as those entities, together with their affiliates and controlling interests, with not more than $3 million in average gross revenues for the preceding three years. Currently, there are only three AMTS licensees, none of whom are small businesses. However, potential licensees in AMTS include all public coast stations, which are classified by the Small Business Administration as Radiotelephone Service Providers, Standard Industrial Classification Code 4812. The Commission does not yet know how many applicants or licensees in these bands will be small entities. We therefore assume that, for purposes of our evaluations and conclusions in the IRFA, all prospective licensees are small entities, as that term is defined by the SBA or by our proposed small business definitions for these bands.

20. “218-219 MHz” Service. For the first auction of the “218-219 MHz” Service the Commission defined a small business as an entity, together with its affiliates, that has no more than a $6 million net worth and, after federal income taxes (excluding any carry over losses), has no more than $2 million in annual profits each year for the previous two years. For that auction, 170 entities won licenses for 594 Metropolitan Statistical Area (MSA) licenses. Of the 594 licenses, 557 were won by entities qualifying as a small business. Subsequently, the Commission changed the service rules and defined small businesses as those entities, together with their affiliates and controlling interests, with not more than $15 million in average gross revenues for the preceding three years, and very small businesses as those entities, together with their affiliates and controlling interests, with not more than $3 million in average gross revenues for the preceding three years. We cannot estimate, however, the number of licenses that will be won by entities qualifying as small businesses under our rules in future auctions of 218-219 MHz spectrum licenses. Given the success of small businesses in the first auction, we assume for purposes of this IRFA that in future auctions all of the licenses in the “218-219 MHz” Service may be awarded to small businesses.

21. Low Power Radio Service. The Low Power Radio Service permits licensees to use the 216-217 MHz segment for auditory assistance, medical devices, and law enforcement tracking devices. Users are likely to be theaters, auditoriums, churches, schools, banks, hospitals, and medical care facilities. The primary manufacturer of auditory assistance estimates that it has sold 25,000 pieces of auditory assistance equipment. Many if not most LPRS users are likely to be small businesses or individuals. However, because the LPRS is licensed by rule, with no requirement for individual license applications or documents, the Commission is unable to estimate how many small businesses make use of LPRS equipment.

22. Telemetry. Incumbent telemetry operators in the 216-220 MHz band include entities such as Fairfield Industries, Inc. which perform geophysical exploration for underground oil and natural gas reserves. Incumbent non-medical telemetry operators in the 1427-1429.5 MHz and 1429.5-1432 MHz bands include Itron, Inc., Pueblo Service Company of Colorado and E Prime, Inc., and large manufacturers such as Deere and Company, Caterpillar, and General Dynamics. None of these licensees are likely to be small businesses. Itron, Inc. is the primary user of the 1427-1429.5 MHz and 1429.5-1432 MHz bands. Itron, Inc., with an investment of $100 million in equipment development, is not likely to be a small business. One licensee, Zytex, a manufacturer of high-speed telemetry systems, may be a small business. The Commission does not yet know how many applicants or licensees in these bands will be small entities. We therefore assume that, for purposes of our evaluations and conclusions in the IRFA, all prospective licensees are small entities.

23. WMTS. Users of medical telemetry are hospitals and medical care facilities, some of which are likely to be small businesses. According to the SBA's regulations, hospitals and nursing homes must have annual gross receipts of $5 million or less in order to qualify as a small business concern. There are approximately 11,471 nursing care firms in the nation, of which 7,953 have annual gross receipts of $5 million or less. There are approximately 3,856 hospital firms in the nation, of which 294 have gross receipts of $5 million or less. Thus, the approximate number of small confined setting entities to which the Commission's new rules will apply is 8,247.

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

24. Applicants for licenses to provide terrestrial fixed and mobile services in the paired 1392-1395 MHz and 1432-1435 MHz bands, the unpaired 1390-1392 MHz band, the unpaired 1670-1675 MHz band, and the unpaired 2385-2390 MHz band will be required to submit short-form auction applications using FCC Form 175. In addition, winning bidders must submit long-form license applications through the Universal Licensing System using FCC Form 601, and other appropriate forms. Licensees will also be required to apply for an individual station license by filing FCC Form 601 for those individual stations that (i) require submission of an Environmental Assessment under Section 1.1307 of our Rules; (ii) require international coordination; (iii) would operate in the quiet zones listed in Section 1.924 of our Rules; or (iv) require coordination with the Frequency Assignment Subcommittee (FAS) of the Interdepartment Radio Advisory Committee (IRAC). We invite comment on how these filing requirements can be modified to reduce the burden on small entities.

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

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

26. We have reduced burdens wherever possible. To minimize any negative impact, however, we propose certain incentives for small entities that will redound to their benefit. These special provisions include partitioning and spectrum disaggregation. These provisions will allow smaller entities to overcome entry barriers. In addition, we seek comment on whether it would be appropriate to license the paired 1392-1395 MHz and 1432-1435 MHz bands and the unpaired 1390-1392 MHz, 1670-1675 MHz and 2385-2390 MHz bands for fixed and mobile services using smaller geographical licensing areas. The use of smaller licensing areas could benefit small entities by reducing costs and build-out expenses.

27. We also propose the use of bidding credits for small entities that participate in auctions of licenses that are conducted pursuant to the rules proposed in this Notice. Thus, for the paired 1392-1395 MHz and 1432-1435 MHz bands and the unpaired 1390-1392 MHz, 1670-1675 MHz, and 2385-2390 MHz bands, we propose to define an “entrepreneur” as an entity with average annual gross revenues not exceeding $40 million for the three preceding years and we propose to define a “small business” as an entity with average annual gross revenues not exceeding $15 million for the three preceding years. With respect to the 1427-1432 MHz band, in which we believe that the capital costs of providing primary telemetry service will in general be lower than the capital costs for the bands discussed above, we propose to define a “small business” as an entity with average annual gross revenues not exceeding $15 million for the three preceding years and a “very small business” as an entity with average annual gross revenues not exceeding $3 million for the three preceding years. We further propose to provide entrepreneurs with a bidding credit of 15 percent, small businesses with a bidding credit of 25 percent, and very small businesses with a bidding credit of 35 percent. We believe that these bidding credits will help small entities compete in our auctions and acquire licenses. We seek comment on our proposed small business definitions and bidding credits, including information on factors that may affect the capital requirements of the type of services a licensee may seek to provide.

28. The regulatory burdens we have retained, such as filing applications on appropriate forms, are necessary in order to ensure that the public receives the benefits of innovative new services in a prompt and efficient manner. We will continue to examine alternatives in the future with the objectives of eliminating unnecessary regulations and minimizing any significant economic impact on small entities. We seek comment on significant alternatives commenters believe we should adopt.

E. Report to Small Business Administration

29. The Commission will send a copy of this Notice of Proposed Rulemaking, including a copy of the IRFA to the Chief Counsel for Advocacy of the Small Business Administration.

F. Federal Rules That May Duplicate, Overlap, or Conflict With the Proposed Rules

30. None.

III. Ordering Clauses

31. Pursuant to sections 1, 4(i), 302, 303(f) and (r), and 332 of the Communications Act of 1934, as amended, 47 U.S.C. 1, 154(i), 302, 303(f) and (r), and 332, Notice is hereby given of the proposed regulatory changes described in this Notice of proposed rulemaking, and that comment is sought on these proposals.

32. Pending applications to use the frequencies listed in § 90.259 of the Commission's Rules, 47 CFR 90.259, Will be processed provided that (i) they are not mutually exclusive with other applications as of February 6, 2002, nor with respect to the frequencies listed in Section 90.259, part of a proposed system that does not meet the requirements of our rules, without reference to any applications that are mutually exclusive with other applications as of February 6, 2002, and (ii) the relevant period for filing competing applications has expired as of that date. Pending applications to use those frequencies not meeting the above criteria Will be held in abeyance until the conclusion of this proceeding. We will determine later, in accordance with such new rules as are adopted, whether to process or return any such pending applications.

33. The Commission's Consumer Information Bureau, Reference Information Center, Shall send a copy of this Notice of proposed rulemaking including the Initial Regulatory Flexibility Analysis, to the Chief Counsel for Advocacy of the Small Business Administration.

List of Subjects

47 CFR Part 1

• Administrative, practice and procedure
• Radio

47 CFR Part 2

• Communications equipment
• Radio

47 CFR Part 27

• Communications common carriers
• Radio

47 CFR Part 90

• Communications equipment
• Radio
• Reporting, recordkeeping requirements

47 CFR Part 95

• Communications equipment
• Radio
• Reporting, recordkeeping requirements

Rule Changes

For the reasons discussed in the preamble the Federal Communications Commission proposes to amend 47 CFR parts 1, 2, 27, 90 and 95 as follows:

PART 1—PRACTICE AND PROCEDURE

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

Authority:47 U.S.C. 151, 154(i), 154(j), 155, 225, 303(r), 309 and 325(e), unless otherwise noted.

2. Section 1.924(g)(1), (g)(2) and (g)(3) is revised to read as follows:

PART 2—FREQUENCY ALLOCATIONS AND RADIO TREATY MATTERS; GENERAL RULES AND REGULATIONS

3. The authority citation for part 2 continues to read as follows:

Authority:47 U.S.C. 154, 302a, 303, and 336 unless otherwise noted.

4. Section 2.106 is amended by revising footnotes US350 and US362 to read as follows:

PART 27—MISCELLANEOUS WIRELESS COMMUNICATIONS SERVICES

5. The authority citation for part 27 continues to read as follows:

Authority:47 U.S.C. 154, 301, 302, 303, 307, 309, 332, 336, and 337 unless otherwise noted.

6. Section 27.4 is amended by adding the following definition in alphabetical order to read as follows:

Subpart I—1.4 GHz Service

Subpart J—1670-1675 MHz Service

Subpart K—2385-2390 MHz Service

Subpart L—Band Managers

PART 90—PRIVATE LAND MOBILE RADIO SERVICE

11. The authority citation for part 90 continues to read as follows:

Authority:Sections 4(i), 11, 303(g), 303(r), and 302(c)(7) of the Communications Act of 1934, as amended, 47 U.S.C. 154(i), 161, 303(g), 303(r), 332(c)(7).

12. Section 90.175 is amended by revising paragraph (i)(13) to read as follows:

PART 95—PERSONAL RADIO SERVICES

14. The authority citation for part 95 continues to read as follows:

Authority:Secs. 4, 303, 48 Stat. 1066, 1082, as amended; 47 U.S.C. 154, 303.

15. Section 95.630 is revised to read as follows: