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Report and Order and Notice of Proposed Rulemaking – MD Docket Nos

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Report and Order and Notice of Proposed Rulemaking – MD Docket Nos April 22, 2020 FACT SHEET* Assessment and Collection of Regulatory Fees for Fiscal Year 2020 Report and Order and Notice of Proposed Rulemaking – MD Docket Nos. 20-105 and 19-105 Background: Section 9 of the Communications Act requires the Commission to assess and collect annual regulatory fees to recover the costs specified by Congress for the agency’s policy, rulemaking, enforcement, and other activities. With this Notice of Proposed Rulemaking, the Commission would begin the process of assessing fees for Fiscal Year (FY) 2020 by proposing and seeking comment on a schedule of regulatory fees. In the Report and Order, the Commission would resolve certain outstanding issues from last year’s Further Notice of Proposed Rulemaking on regulatory fees. What the Report and Order Would Do: • Follow through on the Commission’s proposal to level the playing field between domestic and foreign licensed space stations by assessing a regulatory fee on commercial space stations licensed by other administrations (non-U.S. licensed space stations) with United States market access and including those space stations in the existing space station regulatory fee categories for FY 2020. • Reallocate fees within the International Bureau for International Bureau licensees and regulatees. What the Notice Would Do: • Propose and seek comment on a fee schedule to collect $339,000,000 in regulatory fees, consistent with the Commission’s FY 2020 appropriation from Congress. • Seek comment on the following proposals for the FY 2020 fee schedule: o Continuing to phase in the DBS regulatory fee rate by increasing it by 12 cents over last year; o Assessing regulatory fees for satellite and terrestrial international bearer circuits and submarine cable systems using a revised tiered methodology; and o Assessing FY 2020 regulatory fees for full-power broadcast television stations by using a population-based methodology, based on terrain limited population. * This document is being released as part of a “permit-but-disclose” proceeding. Any presentations or views on the subject expressed to the Commission or its staff, including by email, must be filed in MD Dockets No. 20-105 and 19- 105, which may be accessed via the Electronic Comment Filing System (https://www.fcc.gov/ecfs/). Before filing, participants should familiarize themselves with the Commission’s ex parte rules, including the general prohibition on presentations (written and oral) on matters listed on the Sunshine Agenda, which is typically released a week prior to the Commission’s meeting. See 47 CFR § 1.1200 et seq. Federal Communications Commission FCC-CIRC2005-04 Before the Federal Communications Commission Washington, DC 20554 In the Matter of ) ) Assessment and Collection of Regulatory Fees for ) MD Docket No. 20-105 Fiscal Year 2020 ) ) Assessment and Collection of Regulatory Fees for ) MD Docket No. 19-105 Fiscal Year 2019 ) REPORT AND ORDER AND NOTICE OF PROPOSED RULEMAKING∗ Adopted: [] Released: [] By the Commission: Comment Date: [30 days from Release Date] Reply Comment Date: [45 days from Release Date] TABLE OF CONTENTS I. INTRODUCTION .................................................................................................................................. 1 II. BACKGROUND .................................................................................................................................... 2 III. REPORT AND ORDER ........................................................................................................................ 6 A. Assessing Regulatory Fees on Non-U.S. Licensed Space Stations with U.S. Market Access .............................................................................................................................................. 6 B. Apportionment of Fees among International Bureau Regulatees .................................................. 32 C. Regulatory Fees Paid by VHF Broadcasters .................................................................................. 46 IV. NOTICE OF PROPOSED RULEMAKING ........................................................................................ 50 A. Allocating FTEs for FY 2020 ........................................................................................................ 53 B. International Bearer Circuits .......................................................................................................... 56 C. Television Broadcaster Issues ........................................................................................................ 63 D. Direct Broadcast Satellite Regulatory Fees ................................................................................... 68 E. Additional Regulatory Fee Reform ................................................................................................ 70 V. PROCEDURAL MATTERS ................................................................................................................ 71 VI. ORDERING CLAUSE ......................................................................................................................... 83 APPENDIX A—List of Commenters and Reply Commenters ∗ This document has been circulated for tentative consideration by the Commission at its May 2020 open meeting. The issues referenced in this document and the Commission’s ultimate resolution of those issues remain under consideration and subject to change. This document does not constitute any official action by the Commission. However, the Chairman has determined that, in the interest of promoting the public’s ability to understand the nature and scope of issues under consideration, the public interest would be served by making this document publicly available. The FCC’s ex parte rules apply and presentations are subject to “permit-but-disclose” ex parte rules. See, e.g., 47 C.F.R. §§ 1.1206, 1.1200(a). Participants in this proceeding should familiarize themselves with the Commission’s ex parte rules, including the general prohibition on presentations (written and oral) on matters listed on the Sunshine Agenda, which is typically released a week prior to the Commission’s meeting. See 47 CFR §§ 1.1200(a), 1.1203. Federal Communications Commission FCC-CIRC2005-04 APPENDIX B—Calculation of FY 2020 Revenue Requirements and Pro-Rata Fees APPENDIX C—FY 2020 Schedule of Regulatory Fees APPENDIX D—Sources of Payment Unit Estimates for FY 2020 APPENDIX E—Factors, Measurements, and Calculations that Determine Signal Contours and Associated Population Coverages APPENDIX F—Space Station Satellite Charges for FY 2020 Regulatory Fees APPENDIX G—FY 2020 Full-Service Broadcast Television Stations, by Call Sign APPENDIX H—FY 2019 Regulatory Fees APPENDIX I—Final Regulatory Flexibility Analysis APPENDIX J—Initial Regulatory Flexibility Analysis I. INTRODUCTION 1. In this Report and Order and Notice of Proposed Rulemaking, we follow through on our proposal in the FY 2019 Report and Order and Further Notice of Proposed Rulemaking1 to level the playing field between domestic and foreign licensed space stations by assessing a regulatory fee on commercial space stations licensed by other administrations (non-U.S. licensed space stations) with United States market access, among other things. We also seek comment on the Commission’s proposed regulatory fees for fiscal year (FY) 2020. Specifically, we propose to collect $339,000,000 in regulatory fees for FY 2020,2 pursuant to sections 9 and 9A of the Communications Act of 1934, as amended (Act or Communications Act), and the Commission’s FY 2020 Appropriation.3 II. BACKGROUND 2. 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.4 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.5 Regulatory fees also cover the costs incurred in regulating entities that are statutorily exempt from paying regulatory fees (e.g., governmental and nonprofit entities, amateur radio operators, and noncommercial radio and television stations)6 and entities whose regulatory fees are waived.7 1 Assessment and Collection of Regulatory Fees for Fiscal Year 2019, Report and Order and Further Notice of Proposed Rulemaking, 34 FCC Rcd 8199 (2019) (FY 2019 Report and Order). 2 Fiscal year 2020 started on October 1, 2019. 3 47 U.S.C. § 159. Consolidated Appropriations Act, 2020, Public Law 116-93 (appropriating $339,000,000.00 to the FCC for salaries and expenses and directing the FCC to assess and collect the same amount in offsetting collections) (FY 2020 Appropriation). Congress supplemented the FY 2020 salaries and expenses appropriation in the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), Public Law 116-136 (March 27, 2020), Division B, entitled “Emergency Appropriations for Coronavirus Health Response and Agency Operations,” Title V. Congress, however, did not direct the Commission to include the CARES supplemental funding in the offsetting collection of regulatory fees. 4 47 U.S.C. §§ 159(a) (“shall assess and collect regulatory fees”), 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.”); see also 47 U.S.C. §
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