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Federal Register / Vol. 86, No. 41 / Thursday, March 4, 2021 / Proposed Rules
and other relevant competitive bidding orders.
53. The Auction 109 Comment Public Notice provides notice of proposed auction procedures and adequate time for Auction 109 applicants to comment on those proposed procedures. See 47
U.S.C. 309j3Ei. To promote the efficient and fair administration of the competitive bidding process for all Auction 109 participants, including small businesses, the Auction 109
Comment Public Notice seeks comment on the following proposed procedures:
Use of a simultaneous multiple-round auction format, consisting of sequential bidding rounds with a simultaneous stopping rule with discretion to exercise alternative stopping rules under certain circumstances; a specific minimum opening bid amount for each construction permit to be offered in this auction; a specific number of bidding units for each construction permit; a specific upfront payment amount for each construction permit; establishment of a bidders initial bidding eligibility in bidding units based on that bidders upfront payment through assignment of a specific number of bidding units for each construction permit; use of an activity requirement so that bidders must bid actively during the auction rather than waiting until late in the auction before participating; a singlestage auction in which a bidder is required to be active on 100% of its bidding eligibility in each bidding round; provision of three activity waivers for each bidder to allow it to preserve eligibility during the course of the auction; use of minimum acceptable bid amounts and additional bid increments, along with a proposed methodology for calculating such amounts, while retaining discretion to change the methodology if circumstances dictate; a procedure for breaking ties if identical high bid amounts are submitted on a construction permit in a given round;
whether to permit use of bid withdrawals; establishment of an interim bid withdrawal percentage of 20% of the withdrawn bid in the event bid withdrawals are allowed in Auction 109; and establishment of an additional default payment of 20% under 47 CFR
1.2104g2 in the event that a winning bidder defaults or is disqualified after the auction closes.
54. Legal Basis. The Commissions statutory obligations to small businesses participating in a spectrum auction are found in 47 U.S.C. 309j3B and 309j4D. The statutory basis for the Commissions competitive bidding rules is found in 47 U.S.C. 154i, 301, 303e, 303f, 303r, 304, 307, and 309j. The
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Commission has established a framework of competitive bidding rules pursuant to which it has conducted auctions since the inception of the auction program in 1994 and would conduct Auction 109, including 47 CFR
part 1, subpart Q. See 47 CFR 73.5000, 73.500273.5003, 73.500573.5009. In promulgating those rules, the Commission conducted numerous Initial Regulatory Flexibility Act Analyses IRFAs to consider the possible impact of those rules on small businesses that might seek to participate in Commission auctions. In addition, multiple Final Regulatory Flexibility Analyses FRFAs were included in the rulemaking orders which adopted or amended rule provisions relevant to Auction 109 Comment Public Notice.
The Commission has directed that OEA, in conjunction with MB, under delegated authority, seek comment on a variety of auction-specific procedures prior to the start of bidding in each auction. See 47 CFR 1.2104c, d, e, f, g, i.
55. Description and Estimate of the Number of Small Entities to Which the Proposed Procedures Will Apply. 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 procedures, if adopted. 5 U.S.C.
603b3. The RFA generally defines the term small entity as having the same meaning as the terms small business, small organization, and small government jurisdiction. 5 U.S.C.
6016. In addition, the term small business has the same meaning as the term small business concern under the Small Business Act. See 5 U.S.C. 6013
adopting by reference the definition of small business concern in the Small Business Act, 15 U.S.C. 632. 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. See 15 U.S.C.
632.
56. The specific procedures and minimum opening bid amounts on which comment is sought in the Auction 109 Comment Public Notice will directly affect all applicants participating in Auction 109. The number of entities that may apply to participate in Auction 109 is unknown.
Based on the number of applicants in prior FM auctions, OEA and MB
estimate that the number of applicants for Auction 109 may range from approximately 130 to 260. This estimate is based on the number of applicants who filed short-form applications to participate in previous open auctions of
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FM construction permits held to date, an average of 1.8 short-form applications were filed per construction permit offered, with a median of 1.2
applications per permit. The actual number of applicants for Auction 109
could vary significantly as any individuals or entitys decision to participate may be affected by a number of factors beyond the Commissions control.
57. Radio Stations. This U.S.
Economic Census category comprises establishments primarily engaged in broadcasting aural programs by radio to the public. Programming may originate in their own studio, from an affiliated network, or from external sources.
According to the most recent Report and Order, 85 FR 37364, June 22, 2020, to assess annual regulatory fees, Commission staff identified from the Media Bureaus licensing databases 9,636 licensed radio facilities subject to annual regulatory fees as of October 1, 2019, excluding from this count radio stations exempt from required annual regulatory fees.
58. In 13 CFR 121.201, the SBA
established a small business size standard for this category, NAICS code 515112, as firms having $41.5 million or less in annual receipts. Economic Census data from 2012 shows that 2,849
radio station firms operated during that year. Of that number, 2,806 firms operated with annual receipts of less than $25 million per year, 17 with annual receipts between $25 million and $49,999,999, and 26 with annual receipts of $50 million or more.
Therefore, based on the SBAs size standard, the majority of such entities are small entities.
59. According to Commission staff review of the BIA/Kelsey, LLCs Media Access Pro Radio Database BIA as of January 26, 2021, nearly all AM and FM
full-service radio stations approximately 15,478 of 15,483 total stations, or 99.97% had revenues of $41.5 million or less and thus qualify as small entities under the SBA definition.
The SBA size standard data, however, does not enable a meaningful estimate of the number of small entities who may participate in Auction 109.
60. Also, in assessing whether a business entity qualifies as small under the SBA definition, 13 CFR
121.103a1, business control affiliations must be included. Business concerns are affiliates of each other when one concern controls or has the power to control the other, or a third party or parties controls or has the power to control both. The estimate therefore likely overstates the number of small entities that might be affected by
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