Federal Communications Commission FCC 21-49 Before the Federal Communications Commission Washington, DC 20554 In the Matter of ) ) Assessment and Collection of Regulatory Fees for ) MD Docket No. 21-190 Fiscal Year 2021 ) ) Assessment and Collection of Regulatory Fees for MD Docket No. 20-105 Fiscal Year 2020 REPORT AND ORDER AND NOTICE OF PROPOSED RULEMAKING Adopted: May 3, 2021 Released: May 4, 2021 By the Commission: Comment Date: June 3, 2021 Reply Comment Date: June 18, 2021 Table of Contents Heading Paragraph # I. INTRODUCTION...................................................................................................................................1 II. BACKGROUND.....................................................................................................................................3 III. REPORT AND ORDER – NEW REGULATORY FEE CATEGORIES FOR CERTAIN NGSO SPACE STATIONS ....................................................................................................................6 IV. NOTICE OF PROPOSED RULEMAKING .........................................................................................21 A. Methodology for Allocating FTEs..................................................................................................21 B. Calculating Regulatory Fees for Commercial Mobile Radio Services...........................................24 C. Direct Broadcast Satellite Regulatory Fees ....................................................................................30 D. Television Broadcaster Issues.........................................................................................................32 E. NGSO Regulatory Fees...................................................................................................................35 F. Continued Flexibility in FY 2021 for Regulatory Payors Seeking Waivers Due to Financial Hardship Caused by the COVID-19 Pandemic...............................................................37 G. Additional Regulatory Fee Reform.................................................................................................41 V. PROCEDURAL MATTERS.................................................................................................................42 VI. ORDERING CLAUSES........................................................................................................................58 APPENDIX A - CALCULATION OF FY 2021 REVENUE REQUIREMENTS AND PRO-RATA FEES APPENDIX B - FY 2021 SCHEDULE OF REGULATORY FEES APPENDIX C - SOURCES OF PAYMENT UNIT ESTIMATES FOR FY 2021 APPENDIX D - FACTORS, MEASUREMENTS, AND CALCULATIONS THAT DETERMINE STATION SIGNAL CONTOURS AND ASSOCIATED POPULATION COVERAGES APPENDIX E - SATELLITE CHARTS FOR FY 2021 REGULATORY FEES APPENDIX F - FY 2021 FULL-SERVICE BROADCAST TELEVISION STATIONS BY CALL SIGN APPENDIX G - FY 2020 SCHEDULE OF REGULATORY FEES APPENDIX H - FINAL REGULATORY FLEXIBILITY ANALYSIS APPENDIX I - INITIAL REGULATORY FLEXIBILITY ANALYSIS Federal Communications Commission FCC 21-49 I. INTRODUCTION 1. In this Report and Order and Notice of Proposed Rulemaking we seek comment on the Commission’s proposed regulatory fees for fiscal year (FY) 2021. Specifically, we propose to collect $374,000,000 in regulatory fees for FY 2021,1 pursuant to sections 9 and 9A of the Communications Act of 1934, as amended (Act or Communications Act), and the Commission’s FY 2021 Appropriation.2 2. In light of our review of the record in response to the Further Notice of Proposed Rulemaking (FNPRM) attached to the FY 2020 Report and Order,3 we adopt a new distinction between non-geostationary orbit (NGSO) satellite systems, as further described below, by creating two new fee subcategories, one for “less complex” NGSO systems and a second for all other NGSO systems identified as “other” NGSO systems, both under the broader category of “Space Stations (Non-Geostationary Orbit)” in the Report and Order.4 In the Notice of Proposed Rulemaking, we seek comment on several specific regulatory fee issues: (i) including non-geographic numbers in the calculation of the number of subscribers for each commercial mobile radio service (CMRS) provider; (ii) ending our phase in of direct broadcast satellite (DBS) regulatory fees, and instead including the Media Bureau-based DBS regulatory fee in the same fee category as cable television and Internet Protocol Television (IPTV); (iii) assessing regulatory fees for full service broadcast television using the same population-based methodology that we used for FY 2020 and continuing the changes we adopted previously for stations in Puerto Rico; (iv) adopting new regulatory fees for the new NGSO fee subcategories for “less complex” NGSO systems and “other” NGSO systems; and (v) extending our streamlined waiver provisions adopted last year for FY 2021. II. BACKGROUND 3. The Commission is required by Congress to assess regulatory fees each year in an amount that can reasonably be expected to equal the amount of its appropriation.5 Regulatory fees recover direct costs, such as salary and expenses; indirect costs, such as overhead functions; and support costs, such as rent, utilities, and equipment.6 Regulatory fees also cover the costs incurred in regulating 1 Fiscal year 2021 started on October 1, 2020. The proposed regulatory fee schedule for FY 2021 is set forth in Appendices A and B. For comparison purposes, the FY 2020 regulatory fee rates are listed in Appendix G. 2 47 U.S.C. § 159. Division E—Financial Services and General Government Appropriations Act, 2021, Title V— Independent Agencies, Federal Communications Commission of the Consolidated Appropriations Act, 2021, Public Law No: 116-260 (12/27/2020) (appropriating to the Commission $374,000,000 for its annual salaries and expense and directing the Commission to collect $374,000,000 in offsetting collections for fiscal year 2021). Of the $374,000,000 appropriation, Congress directed that “$33,000,000 shall be made available until expended for implementing title VIII of the Communications Act of 1934 (47 U.S.C. 641 et seq.), as added by the Broadband DATA Act (Public Law 116–130).” Id. 3 Assessment and Collection of Regulatory Fees for Fiscal Year 2020, Report and Order and Further Notice of Proposed Rulemaking, __ FCC Rcd __, __ paras. 88-93 (2020) (FY 2020 Report and Order). 4 Previously, in the Small Satellite Report and Order, the Commission adopted a regulatory fee category for small satellites and small spacecraft. Streamlining Licensing Procedures for Small Satellites, Report and Order, 34 FCC Rcd 13077, 13118-19, para. 105 (2019) (Small Satellite Report and Order). There are no small satellite or small spacecraft systems that were licensed or granted market access and operational for which we would assess FY 2021 regulatory fees; however, we anticipate that regulatory fees for some small satellite systems will be due for FY 2022. We will seek comment later on the proposed fee for FY 2022. 5 47 U.S.C. § 159(a) (“shall assess and collect regulatory fees”); 47 U.S.C. § 159(b) (“Commission shall assess and collect regulatory fees at such rates as the Commission shall establish in a schedule of regulatory fees that will result in the collection, in each fiscal year, of an amount that can reasonably be expected to equal the amounts described in subsection (a) with respect to such fiscal year.”). 6 Assessment and Collection of Regulatory Fees for Fiscal Year 2004, Report and Order, 19 FCC Rcd 11662, 11666, para. 11 (2004) (FY 2004 Report and Order). Federal Communications Commission FCC 21-49 entities that are statutorily exempt from paying regulatory fees (e.g., governmental and nonprofit entities, amateur radio operators, and noncommercial radio and television stations)7 and entities whose regulatory fees are waived.8 For the FY 2021 appropriation, the Commission must recover $374,000,000, as set forth in the 2021 Appropriations Act.9 4. The Commission’s methodology for assessing and amending regulatory fees must “reflect the full-time equivalent number of employees within the bureaus and offices of the Commission, 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.”10 Since 2012, the Commission has assessed the allocation of full- time equivalents (FTEs)11 by first determining the number of direct FTEs in each “core” bureau that carries out licensing activities (i.e., the Wireless Telecommunications Bureau, Media Bureau, Wireline Competition Bureau, and International Bureau) and then attributing all other non-auction FTEs, or indirect FTEs, to payor categories based on these core FTE allocations.12 5. Each year the Commission issues a Notice of Proposed Rulemaking to seek comment on its regulatory fee methodology and proposed regulatory fees for the fiscal year. The Commission also seeks to improve the regulatory fee methodology. Since 2013, the Commission has made numerous reforms to the regulatory fee schedule.13 In 2019, the Commission adopted several rule amendments14 to conform them to the RAY BAUM’S Act of 2018.15 Last year, the Commission added non-U.S. licensed space stations with United States market access grants to the regulatory fee schedule.16 The Commission concluded that assessing the same regulatory fees on all space stations with U.S. market access, whether U.S. licensed or non-U.S. licensed, would better reflect the benefits received by these operators through the Commission’s adjudicatory, enforcement, regulatory,