FCC 92·27 Federal Communications Commission Record 7 FCC Red No. 3 
Before the 
Federal Communications Commission 
Washington, D.C. 20554 
PR Docket No. 89-552 
In the Matter of 
Amendment of Part 90 of the 
Commission's Rules to Provide 
for the Use of the 220-222 MHz 
Band by the Private Land Mobile 
Radio Services 
FURTHER NOTICE OF PROPOSED RULE MAKING 
Adopted: January 21, 1992; Released: January 30, 1992 
Comment Date: March 2, 1992 
Reply Comment Date: March 23, 1992 
By the Commission: 
I. INTRODUCTION 
I. We are issuing this Further Notice of Proposed Rule 
Making to solicit the public"s views regarding the best 
available means for selecting licensees for the 220-222 
MHz nationwide authorizations. Specifically. commenters 
are requested to address whether the use of comparative 
hearings is preferred to random selection as a mechanism 
for determining which nationwide applicants are best 
qualified to become licensees. Commenters are also asked 
to discuss whether the distinctions between the nation­
wide commercial and non-commercial set-asides 1 render 
any particular selection procedure preferable in either 
context. Finally, we are proposing certain general criteria 
to be used in the event that we choose to employ com-
Commercial nationwide licensees will be permitted to pro­
vide entrepreneurial communications service to any Part 90 
eligible. Non-commercial licensees, in contrast. will be 
permitted to use the nationwide system only for their own 
internal communications purposes. 
2 Notice of Proposed Rule Making, PR Docket No. 89-552. 4 
FCC Red 8593. 8599 (1989); Report and Order. 6 FCC Red 2356. 
2365 (1991) [hereinafter Report and OrderJ. 
3 Report and Order, 6 FCC Red at 2365. 
4 For example, for nationwide applicants. we adopted rules (I) 
prohibiting a person or entity from holding any interest in 
mutually exclusive applications; (2) requiring the submission of 
certified financial data showing that the applicant has the fi­
nances to construct 40 percent of the system and operate it for 
four years; (3) imposing stringent construction requirements; 
and (4) prohibiting license transfers and the leasing of excess 
capacity until certain specified conditions have been satisfied. 
With respect to the local channels, we adopted cross-ownership 
and construction requirements similar to those adopted for the 
nationwide authorizations. For example. we require that li­
censees must construct and have local systems in operation 
within eight months of the license grant, and we prohibit li­
cense transfers until the facilities are fully constructed. 
898 
parative selection procedures. Commenters are requested 
to discuss the utility of these criteria as well as to suggest 
additional criteria designed to identify the best qualified 
applicants. 
II. BACKGROUND/DISCUSSION 
2. In the Notice of Proposed Rule Making and Report 
and Order adopted in this proceeding, we concluded that 
the lottery process was the best available alternative for 
the selection of licensees.2 In substantial part, this decision 
was premised upon our view that, because of the difficulty 
inherent in attempting to devise meaningful comparative 
criteria where private land mobile services are involved, 
the time and expense associated with comparative hear­
ings would not likely produce a result more enlightened 
or more in the public interest than selection via lottery.3 
Because we recognized that an undesirable characteristic 
of lotteries is their appeal to speculators, we took several 
steps designed to minimize the number of speculative 
applications filed. and thus to restrict lottery entry to 
entities with legitimate communications plans. 4 Neverthe­
less, we received approximately 60.000 applications, the 
majority of which are for the local channels.5 In our view, 
the considerable number of applications filed demon­
strates that despite the adoption of measures specifically 
designed to prevent such a result. the 220-222 MHz lot­
tery was perceived as a "treasure hunt" by a number of 
entities that have no apparent legitimate interest in devel­
oping and operating communications systems.h 
3. In light of the above. we have been prompted to 
reexamine our decision and to consider whether the use 
of comparative hearings would be advantageous in guar­
anteeing that only the most qualified entities are selected 
for the nationwide 220-222 MHz authorizations. Although 
the number of local applications filed leads us to believe 
that the principal amount of speculation occurred at the 
local level. we remain convinced that the substantial 
similarities between the proposed systems of local ap­
plicants make it impracticable to attempt to compare 
their relative qualifications. 7 Moreover. in view of the 
volume of local applications filed and the small amount 
Of the nearly 60,000 applications filed. only 174 are for 
nationwide authorizations. 
0 Our alarm with regard to speculative filings is particularly 
acute because of our recent experience in the 900 MHz private 
land mobile context. Specifically. our records reflect that in 
response to the allocation of channels in the 900 MHz band for 
use by Specialized Mobile Radio systems (SMRs). we received 
58.480 applications for Q20 possible license grants. Of the 822 
SMR licenses granted, 265 have been cancelled for failure to 
meet the Commission's construction requirements. 
7 See In re Amendment of Part 22 to Provide for Filing and 
Processing of Applications for Unsened Areas in the Cellular 
Service. CC Docket Nos. 90-6, 85-388. 69 RR2d 1277 ( 1991 )(com­
parative hearings are particularly ill-suited where the differ­
ences between applicants and their proposed systems are 
relatively negligible); see also In re Amendment of the Commis­
sion's Rules to Allow the Selection from Among Mutually Ex­
clusive Competing Cellular Applications Using Random 
Selection or Lotteries Instead of Comparative Hearings. CC 
Docket No. 83-1096. 98 FCC 2d 175, 186 (lQ8-t)(same), modified. 
101 FCC 2d 577, further modified, 59 RR2d 407 (1985), aff'd in 
part and rev'd in part, Maxcell Telecom Plus. Inc. v. FCC, 815 
F.2d 1551 (D.C. Cir. 1987). 
7 FCC Red No. 3 Federal Communications Commission Record FCC 92-27 
of spectrum associated with each local license, it would be 
markedly inefficient for us to devote our resources to the 
comparative evaluation of local applicants. 
4. In contrast, the potential value of the nationwide 
authorizations, the small number of nationwide licenses 
available, and the amount of spectrum associated with 
each nationwide license cause us to question whether the 
public interest would be better served by the use of proce­
dures more exacting than the lottery process to select 
nationwide applicants. Consequently, we solicit 
commenters' views regarding the best means, using the 
tools currently available to us, to ensure that only the 
most qualified entities are selected for nationwide licens­
ing. Specifically, commenters are requested to address the 
relative advantages and disadvantages of comparative pro­
cedures as opposed to random selection. and to discuss 
the likelihood that comparative hearings will successfully 
identify significant distinctions between applicants and 
their ability to use the nationwide authorizations effec­
tively. Commenters are also requested to discuss whether 
the benefits of employing comparative procedures to se­
lect nationwide licensees outweigh the cost and time asso­
ciated with the comparative hearing process. In particular 
in this regard, we solicit comment with respect to the 
administrative workability of using comparative proce­
dures to evaluate the number of applicants seeking na­
tionwide licensing, and request commenters' views as to 
the best means, from an administrative standpoint, for 
conducting comparative proceedings. 
5. As indicated. we also seek comment with respect to 
whether the distinctions between the nationwide commer­
cial and non-commercial authorizations cause a particular 
selection process to be more or less suitable in either 
context. For example. commenters are asked to address 
the significance of the fact that the commercial nation­
wide authorizations will be available to the licensees· nu­
merous customers, whereas the noncommercial channels 
will be used almost exclusively by four single entities for 
the purpose of satisfying their internal nationwide com­
munications needs. and to discuss whether this or any 
other characteristics unique to either set-aside render se­
lection via lottery or comparative procedures particularly 
appropriate. 
6. In addition. in recognition of the special status of the 
non-commercial nationwide channels. we solicit comment 
as to the efficacy of adopting stricter operating and con­
struction standards as a means for narrowing the non­
commercial pool of applicants to only those entities with 
the greatest interest and demonstrated capability to de­
velop a non-commercial nationwide communications sys­
tem. In particular, commenters are asked to discuss the 
merits of rule changes that would ( l) require nationwide 
8 The rule adopted in the Report and Order contains a IO-year 
construction requirement. See -17 C.F.R. § 90.725(a). 
9 If we decide to use comparative procedures to select nation­
wide licensees, the entry criteria adopted in the Report and 
Order, see, e.g., -17 C.F.R. §§ 90.713, 90.725, would serve as basic 
~alifications each applicant would be required to meet. 
We also ask commenters to discuss whether application 
filing fees should be refunded to applicants for nationwide com­
mercial or non-commercial authorizations who, in light of any 
rule changes stemming from this proceeding, voluntarily with­
draw prior to commencement of the selection process. In this 
connection. we note that we interpret -17 C.F.R. § l. I l I l(a)(4) to 
899 
non-commercial licensees to construct at least one base 
station in a minimum of 70 markets within five rather 
than ten years of licensing;8 and (2) require applicants for 
nationwide non-commercial licensing to demonstrate an 
actual presence or long-term business plan that necessi­
tates internal communications capacity in the 70 or more 
markets identified in the license application. Commenters 
favoring the imposition of a requirement that applicants 
demonstrate an actual presence or long-term business 
plan necessitating internal communications capacity in 70 
or more markets are further requested to suggest a meth­
odology for making this showing. Although we believe the 
adoption of the rule changes set forth in the preceding 
paragraph would be useful in conjunction with either 
random selection procedures (as entry criteria) or com­
parative hearings (as additional basic qualifications),9 
commenters are asked to discuss whether, in their view, 
the strengthening of the construction and operational re­
quirements would be more effective in the context of a 
particular form of selection procedure. 10 
7. In the event that we decide to use comparative 
selection procedures in either the commercial or non­
commercial nationwide context or both. we propose to 
adopt specific comparative criteria that will focus on the 
following three general areas: (I) the applicant's ability to 
demonstrate that it can provide service more quickly than 
required by the basic qualifications: (2) the applicant's 
ability to construct more than the minimum of one base 
station in a greater number of geographic areas than the 
70 required as a basic qualification: and (3) the appli­
cant's ability to demonstrate that its proposed use or 
system design is exceptionally innovative or proficient. 
Under the first of these three criteria. we propose to 
require applicants to submit documentation reflecting that 
they have a firm financial commitment and business plan 
that will allow them to construct and operate base stations 
sooner than required under the basic qualification con­
struction benchmarks. 11 Similarly. an applicant seeking 
comparative credit for providing expanded service pursu­
ant to the second factor set forth above would be required 
to submit an additional financial showing demonstrating 
that it will in fact be able to serve additional markets. We 
also propose to provide comparative credit under the 
second general area to an applicant able to demonstrate 
that its system can readily expand service within a market 
to satisfy growing service demand and expansions in pop­
ulation.12 Applicants seeking to obtain comparative credit 
under the third factor. technological innovation, would 
also be credited for prior experience in operating commu­
nications systems or manufacturing communications 
permit us to refund the application fees paid by any such entity. 
1 See 47 C.F.R. § 90.725. We propose to require applicants 
seeking comparative credit to produce a new accelerated con­
struction schedule. Applicants seeking comparative credit for 
expedited construction would be required to fulfill the new 
construction obligation or forfeit their license and all construc­
tion completed to that point. 
12 A similar criterion was adopted when the Commission used 
comparative procedures in the cellular context. See, e.g., An 
Inquiry into the Use of the Bands 825-8-15 and 870-890 MHz for 
Cellular Communications Systems, CC Docket No. 79-318, FCC 
No. 81-161, 86 FCC 2d -169, 502-03 (1981). 
FCC 92-27 Federal Communications Commission Record 7 FCC Red No. 3 
equipment in a manner indicative of their ability to op­
erate effectively a nationwide system of the type 
proposed. 13 
8. We request co·mmenters to discuss the effectiveness of 
these three general areas of focus in terms of the likeli­
hood (that they will produce meaningful distinctions be­
tween applicants as well as their administrative 
workability. Commenters are also requested to discuss 
whether different comparative criteria should be formu­
lated for the commercial and non-commercial channels. 
For example, the ability to provide service to expanded 
areas of population may be a criterion of little utility in 
the non-commercial setting. By the same token, it may be 
useful in the non-commercial context to give comparative 
credit to applicants able to demonstrate that their pro­
posed communications plan will be of value to their 
business by causing quantitative increases in efficiency 
and productivity. Furthermore, although we propose that 
each comparative factor be given equal weight, we solicit 
commenters' views as to whether certain criteria should 
be weighed more heavily than others. In addition, 
commenters are asked to set forth their views as to how 
applicants should be required to make the various 
showings needed to obtain comparative credit pursuant to 
each factor set forth above, and to suggest any additional 
criteria that will be of assistance in identifying the best 
qualified applicants. Finally, we request commenters to 
suggest a methodology for the assignment of comparative 
credits in a manner that takes into account various com­
binations in the three areas of focus. Specifically, 
commenters are asked to discuss the feasibility of design­
ing a method that will reduce the various criteria to a 
single common denominator or ranking procedure. there­
by permitting meaningful comparison. 
III. CONCLUSION 
9. In summary. we are issuing this Further Notice of 
Proposed Rule Afoking to solicit commenters' views and to 
create a record for ascertaining the best means within our 
statutory authority for selecting nationwide 220-222 MHz 
licensees. In addition. we take action proposing general 
comparative criteria to be used in the event that compara­
tive selection procedures are chosen. An appendix reflect­
ing the proposed rule changes is attached. 
IV. PROCEDURAL MATTERS 
Exparte Rules - Non-Restricted Proceeding 
10. This is a non-restricted notice and comment rule 
making proceeding. Ex parte presentations are permitted 
except during the Sunshine Agenda period. provided that 
they are disclosed as provided in the Commission's Rules. 
See generally 47 C.F.R. §§ 1.1202. l.1203. 1.1206(a). 
Initial Regulatory Flexibility Analysis 
11. We certify that the Regulatory Flexibility Act of 
1980 does not apply to this proceeding. Any action taken 
as the result of this Further Notice of Proposed Rule Afok-
13 Commenters are asked to set forth specific proposals as to 
how an applicant's prior experience should be given compara­
tive credit. For example. we request commenters to discuss 
900 
ing is unlikely to have a significant economic effect on a 
substantial number of small business entities, as defined 
by Section 601(3) of the Regulatory Flexibility Act, be­
cause the significant capital expenditures involved in ap­
plying for the 220-222 MHz nationwide authorizations 
generally renders these channels suitable only for large 
enterprises. The Secretary shall send a copy of this Further 
Notice of Proposed Rule Making, including the certifica­
tion. to the Chief Counsel for Advocacy of the Small 
Business Administration in accordance with paragraph 
603(a) of the Regulatory Flexibility Act. Pub. L. No. 
96-354, 94 Stat. 1164, 5 U.S.C. § 601 et seq. (1981). 
Comment Dates 
12. Pursuant to applicable procedures set forth in Sec­
tions 1.415 and 1.419 of the Commission's Rules, 47 
C.F.R. §§ 1.415, 1.419, interested parties may file com­
ments on or before March 2, 1992, and reply comments 
on or before March 23, 1992. To file formally in this 
proceeding, you must file an original and five copies of 
all comments, reply comments, and supporting com­
ments. If you wish for each Commissioner to receive a 
personal copy of your comments. you must file an origi­
nal plus nine copies. You should send comments and 
reply comments to Office of the Secretary, Federal Com­
munications Commission, Washington. D.C. 20554. Com­
ments and reply comments will be available for public 
inspection during regular business hours in the Dockets 
Reference Room of the Federal Communications Com­
mission. 1919 M Street, N.W., Washington. D.C. 20554. 
13. For further information concerning this proceeding, 
contact Karen Kincaid, Private Radio Bureau. Room 
5202. Federal Communications Commission, Washington. 
D.C. 20554, telephone (202) 634-2443. 
14. Authority for issuance of this Further Notice of 
Proposed Rule Making is contained in Sections 4(i) and 
303(r) of the Communications Act of 1934, as amended. 
47 U.S.C. §§ 154(i) and 303(r). 
FEDERAL COMMUNICATIONS COMMISSION 
Donna R. Searcy 
Secretary 
APPENDIX 
47 C.F.R. Part 90 is proposed to be amended as follows: 
1. The authority citation for Part 90 continues to read 
as follows: 
Authority: Sections 4, 303, 48 Stat. 1066, 1082, as 
amended; 47 U.S.C. 154, 303. 
2. 47 C.F.R. § 90.711 is amended by revising 
paragaraph (a) to read as follows: 
whether a point credit system is appropriate for this criterion 
and. if so, how points would best be awarded. 
7 FCC Red No. 3 Federal Communications Commission Record 
§ 90.711 Processing of applications. 
(a) Applications will be processed on a first-come, first­
served basis. When multiple applications are filed on the 
same day for frequencies in the same geographic area, and 
insufficient frequencies are available to grant all applica­
tions (i.e., if all applications were granted, violation of the 
provisions of § 90.723(f) of this part would result), or 
when multiple applications for nationwide systems are 
filed on the same day for a number of systems in excess of 
those available in the relevant category (10-channel non­
commercial, 5-channel non-commercial or 5-channel 
commercial), these applications will be considered mutu­
ally exclusive. All mutually exclusive nationwide applica­
tions will be resolved through the use of comparative 
procedures. 
* * * * * 
3. 47 C.F.R. § 90.713 is amended by adding paragraph 
(a)(6) to read as follows: 
§ 90.713 Entry Criteria. 
(a) * * * 
(6) Applicants for non-commercial nationwide licensing 
must also submit a written certification demonstrating an 
actual presence or long-term business plan necessitating 
internal communications capacity in the 70 or more mar­
kets identified in the license application. 
* * * * * 
4. 47 C.F.R. § 90.725 is amended by revising paragraph 
( h) to read as follows: 
§ 90.725 Construction requirements. 
* * * * * 
(h) Licensees granted non-commercial nationwide au­
thorizations will be required to construct base stations in 
a minimum of 70 markets designated in the license ap­
plication within five years of the initial license grant. 
901 
FCC 92-27