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A. 1. a.(1)(a) i) a) I. 1. 1. a.(1)(a) i) a)  SX(1. By this First Report and Order, the Commission modifies its rules to extend first come/first served processing to applications for minor changes to AM, reserved frequency noncommercial educational FM ("NCE FM") and FM translator facilities. We also expand the definition of "minor change" in these services to conform more closely to the commercial FM definition, which includes all changes except changes in community of license and certain changes in frequency and/or class. Finally, we amend the contingent application rule to permit the filing of up to four related and simultaneouslyfiled FM station construction permit applications. These modifications were proposed as part of a broadbased initiative, undertaken in conjunction with the Commission's  S(1998 biennial regulatory review, to streamline Mass Media Bureau radio technical rules.* {O(ԍ See 1998 Biennial Regulatory Review Streamlining of Radio Technical Rules in Parts 73 and 74 of the  {OL(Commission's Rules, Notice of Proposed Rule Making in MM Docket No. 9893, 13 FCC Rcd 14849, 1485051  {O((1998) ("Notice"). The Commission will act on the other proposals set forth in the Notice in a forthcoming  {O(Report and Order. We are adopting the subject proposals now in order to expedite the benefits to the public of the new procedures adopted herein, particularly with regard to AM and FM translator major change applications  {Or(that will be reclassified as minor changes under the new rules. See Implementation of Section 309(j) of the Communications Act Competitive Bidding for Commercial Broadcast and Instructional Television Fixed  {O(Service Licenses, Notice of Proposed Rule Making in MM Docket No. 97234, 12 FCC Rcd 22363, 22388  yO((1997).* After careful review of the comments filed in this proceeding, we are persuaded that these measures will encourage licensees and permittees to propose service improvements by making the AM, commercial FM, NCE FM and FM translator application processes simpler, faster and more efficient."0*''))"  S(u* I. EXTENDING FIRST COME/FIRST SERVED PROCESSING TO AM, NCE FM AND FM TRANSLATOR MINOR CHANGE APPLICATIONS; REVISING THE DEFINITION OF  S(@ "MINOR" CHANGE IN THESE SERVICES x  S`( A. BACKGROUND Đx  S(2. Proposed Rule Changes. Under the first come/first served processing system now used for minor change applications for commercial FM broadcast stations, the filing of a first acceptable  S(application "cuts off" the filing rights of subsequent, conflicting applicants.l  {O* (ԍ 47 C.F.R.  73.3573(f)(1); see Amendment of Sections 73.3572 and 73.3573 Relating to the Processing of  {O (FM and TV Broadcast Applications, Report and Order in MM Docket No. 84750, 50 Fed. Reg. 19936, 19941 {O (42; recon. den., 50 Fed. Reg. 43157 (1985); see also Amendment of the Commission's Rules to Permit FM  {O (Channel and Class Modifications by Application, Report and Order in MM Docket No. 92159, 8 FCC Rcd 4735, 473839 (1993) (minor change applications protected against subsequentlyfiled, conflicting rulemaking petitions). The term "conflicting" refers to applications that cannot both be granted without creating impermissible interference. Conflicting applications are "mutually exclusive" or "competing" if they meet applicable criteria entitling them to equal priority: mutually exclusive applications cannot be disposed of except by elimination of the mutual exclusivity through technical amendment, settlement between the applicants, auction  {O:(or other means. See infra, n. 4 and accompanying text. Under the first come/first served processing system, mutual exclusivity between minor change applications arises only where conflicting minor change applications  {O(are filed on the same day. See 47 C.F.R.  73.3573(f)(1).  Under our present rules, however, minor change applications for AM, NCE FM and FM translator stations remain subject to  Sr(mutually exclusive proposals until the staff disposes of the applications.r  yO(ԍ 47 C.F.R.  73.3571 (Processing of AM broadcast station applications), 73.3573 (NCE FM), and 74.1233  yO((FM translators). As we explained in the  SJ (Notice, this policy exposes minor change applicants in these services to significant uncertainty and delay: at any time during the pendency of an application, a mutually exclusive proposal may be filed that could halt further processing of the application and necessitate a technical amendment, settlement between the applicants, or designation of the applications for comparative hearing to eliminate the  S (mutual exclusivity. T  {O(ԍ See Notice of Proposed Rule Making in MM Docket No. 97234, 12 FCC Rcd 22363, 2236467 (1997), regarding problems with the traditional comparative broadcast hearing process. The Commission concluded in  {O2(the First Report and Order in MM Docket No. 97234, 13 FCC Rcd 15920, 1592830 (1998), that mutually exclusive minor change applications in the commercial radio broadcast services will not be subject to auction procedures and that reserved NCE FM frequencies are statutorily exempted from auction procedures. Parties with mutually exclusive minor change applications are expected to use engineering solutions and negotiations to  {OT (resolve the mutual exclusivities. Id. at 1598990. The Commission presently is considering the possibility of using a lottery or point system to select among mutually exclusive NCE FM new and major change applicants.  {M!(Reexamination of the Comparative Standards for Noncommercial Educational Applicants, Further Notice of  {O"(Proposed Rule Making in MM Docket No. 9531, FCC 98269 (released October 21, 1998).  The prospect of expending significant resources to prosecute an application without any certainty of grant may substantially deter applicants from seeking to improve service.  S\(Therefore, we proposed in the Notice to extend first come/first served processing to AM, NCE FM and"\0*&&)) "  S(FM translator minor change applications.K {Oh(ԍ Notice, 13 FCC Rcd at 14870.K  S(3. Our current rules also treat proposed facilities changes in the different radio services inconsistently. In the commercial FM service, only proposed changes in community of license and  S`(changes to a nonadjacent or nonintermediate frequency channel are defined as major changes.$`Z yOZ(ԍ 47 C.F.R.  73.3573(a)(1). Adjacent channels include the three channels above and the three channels below the existing channel. Intermediate frequency channels are channels that are 10.6 or 10.8 MHz (53 or 54  {O(channels) apart in frequency. See Review of Technical Parameters For FM Allocation Rules of Part 73, Subpart  {O (B, FM Broadcast Stations, Third Report and Order in MM Docket No. 86144, 4 FCC Rcd 3557 (1989). In the other radio services, however, the following changes are so defined: (1) for AM stations, most proposed increases in power, as well as any changes in frequency, hours of operation and community of license; (2) for NCE FM stations, changes in power, antenna location and/or antenna height above average terrain that would result in a change of 50 percent or more in the station's predicted 1 mV/m (60 dBu) coverage area, as well as any changes in frequency and community of license; and (3) for FM translators, changes in area to be served greater than 10 percent of the authorized 1 mV/m  SH (coverage area and changes in frequency.H F {O.(ԍ See 47 C.F.R.  73.3571(a)(1), 73.3573(a)(1), 74.1233. Section 73.3571 establishes an exception where  {O(the AM station's radiation levels in all directions remain the same due to a reduction of antenna efficiency. Id. at  73.3571(a)(1). A proposal by a Class D AM station to increase nighttime power up to 250 watts (and 141  {O(mV/m at 1 kilometer equivalent) is treated as a minor change. Id. FM translators, as a secondary service, may  {OT(seek community of license changes by filing minor change applications. Id. at  74.1233(a)(1); see infra, n. 23.  With the exception of proposed changes in community of license and certain channel changes, these "major" changes are fundamentally technical and minor in nature: review of them is primarily an engineering function, and they do not have a significant preclusionary impact on other potential radio spectrum uses. Accordingly, we tentatively concluded in  S (the Notice that the additional administrative procedures imposed as a result of their "major change"  S (classification under the current rules are unnecessarily burdensome.$  {O (ԍ See Notice, 13 FCC Rcd at 1487172. Unlike minor changes, major change applications are subject to a number of statutory requirements. These include providing both a thirtyday public notice period following the acceptance of a major change application and the opportunity to file petitions to deny and mutually exclusive  {Oz(applications within this thirtyday period. See 47 U.S.C.  309(b); 47 C.F.R.  73.3573(e), 73.3580. We proposed to expand the definitions of minor change for the AM, NCE FM and FM translator services to conform more closely  S2(to the commercial FM definition.K 2 {O(ԍ Notice, 13 FCC Rcd at 14872.K To prevent NCE FM and FM translator stations from abandoning their present service areas, however, we proposed to limit "minor changes" in these services to proposals that would continue to provide 1 mV/m service to some portion of the stations' presently  S(authorized 1 mV/m service areas.< | {O#(ԍ Id. at 14872.< " 0*&&))"Ԍ S(4. Overview of Comments. The comments filed in response to the subject proposals were overwhelmingly favorable, with all of the respondents favoring some form of the proposals. Thirteen commenters support the Commission's proposal to extend cutoff protection to AM and NCE FM minor change applications, and eleven support the proposal with regard to FM translator minor change  Sb(applications. b {O(ԍ See comments and reply comments filed by VSoft Communications, Sound of Life, Inc., West Virginia Radio Corporation, du Treil Lundin & Rackley, Inc., Hardy & Carey, Communications Technologies, Inc., National Public Radio, Inc. ("NPR"), the Association of Federal Communications Consulting Engineers, Hatfield & Dawson Consulting Engineers, LLC ("Hatfield & Dawson"), Educational Information Corporation ("EIC"), Radio Property Ventures, South Central Communications Corporation and Press Communications, LLC. Hatfield & Dawson and EIC argue that the first come/first served processing system should not be extended to the FM translator service because it is a secondary service. In reply, NPR contends that cutoff protection is appropriate despite the FM translator service's secondary status, and particularly important for NCE FM translators, because  {O (the Commission currently lacks standards to resolve mutually exclusive NCE FM applications. See supra, n. 4. The fourteen respondents that addressed the Commission's proposal to expand the minor change definition in the AM, NCE FM and FM translator services also favor the proposal,  S(although several do not support it with regard to all three services.S  {ON(ԍ See comments and reply comments filed by National Association of Broadcasters, Sound of Life, Inc., Radio Property Ventures, Communications Technologies, Inc., VSoft Communications, FullerJeffrey Broadcasting Companies, Inc., NPR, Mullaney Engineering, Inc., Graham Brock, Inc., South Central Communications Corporation, West Virginia Radio Corporation ("WVRC") (supporting proposal with regard to AM only), Hardy & Carey (AM and FM translator only), EIC (NCE FM only) and Press Communications, LLC. WVRC and EIC do not explain their reasons for not supporting this proposal with regard to all three services.  {O(Hardy & Carey's objection to expanding the NCE FM minor change definition is discussed infra,  5 and 9. None of the comments specifically addressed our proposal to limit minor changes in the NCE FM and FM translator services to proposals that would continue to provide 1 mV/m service to some portion of the stations'  {OZ(presently authorized 1 mV/m service areas. See infra,  8.S The commenters generally agree  S(with the description of the public interest benefits in the Notice. Several commenters suggest that we also treat proposed community of license changes in the AM, NCE FM and FM translator services as minor changes, pointing out that the Commission's rules permit commercial FM licensees or permittees to seek community of license changes without facing mutually exclusive or competing  SL (applications under certain circumstances. (L : {O&(ԍ See comments filed by West Virginia Radio Corporation (AM only), Communications Technologies, Inc.  {O((AM only) and Radio Property Ventures; 47 C.F.R.  1.420(i); Amendment of the Commission's Rules Regarding  {O(Modification of FM and TV Authorizations to Specify a New Community of License in MM Docket 88526, 4  {O(FCC Rcd 4870 (1989) ("New Community of License R&O"); see also infra,  9.  S (5. Four commenters express concern that the new procedures could facilitate abuses by  S (applicants, and several suggest additional safeguards in order to prevent "warehousing" of spectrum.$ * {O"(ԍ See comments filed by Hardy & Carey, NPR, EIC and VSoft Communications. The Commission's rules and policies are intended to encourage the timely construction and prompt initiation of service by new and  {O0$(modified broadcast facilities. See Construction of Broadcast Stations, 102 FCC 2d 1054, 1057 (1985). Permittees who do not demonstrate a willingness to construct their authorized facilities are, in effect,"$ 0*&&$" "warehousing" spectrum, which precludes service by other potential broadcasters and, therefore, disserves the  {OX(public interest. See id.  " "0*&&))J " For example, NPR worries that the new procedures "may encourage a few broadcasters with extensive resources to flood the Commission with minor change applications immediately after the conclusion of this proceeding, regardless of whether they have plans to modify their facilities. This in turn could limit the ability of stations with actual upgrade plans to make necessary modifications when they need  S`(to do so." NPR suggests that we delay implementation of the new procedures for six months, in order to allow stations to assess their future needs and provide a meaningful opportunity to file for facility improvements under the first come/first served procedures. Hardy & Carey opposes expansion of the NCE FM minor change definition, arguing that many NCE FM licensees lack the resources or sophistication to monitor spectrum availability and "need time to arrange financing and obtain  S(institutional approval to file an application." It is also concerned that licensees with multiple authorizations could take unfair advantage of the new procedures by filing minor change applications immediately after surrendering other authorizations, before the issuance of public notice alerts other  S (parties to the availability of spectrum. VSoft Communications suggests strict application of construction permit extension rules to address warehousing concerns, and EIC recommends that we take a "hard look" at applicants' financial ability to implement proposed modifications.  S (+ B. DISCUSSION Đx  S0(6. After careful review of the record in this proceeding, and in light of our experience in administering the commercial FM application process, we conclude that our AM, NCE FM, and FM  S(translator application processing rules should be amended as proposed in the Notice. Accordingly, we will extend first come/first served processing to AM, NCE FM and FM translator minor change applications. Furthermore, we will expand the definition of "minor change" for these services to conform more closely to the commercial FM definition. Under the modified rules we are adopting, nonexpanded band AM, NCE FM and FM translator licensees or permittees will be able to propose changing their frequencies to adjacent channels, and for FM translators to intermediate frequencies  S(("IF"), by filing minor change applications.0Z" yO(ԍ First, second and third adjacent channels will be considered "adjacent." Two FM stations are IFrelated  {O|(when their assigned frequencies are 10.6 or 10.8 MHz (53 or 54 channels) apart in frequency. See supra, n. 6.  0 Proposed changes in power, antenna height and/or antenna location for stations in these services (including expanded band stations) also will be classified as minor changes, provided that NCE FM and FM translator stations proposing antenna location changes would continue to provide 1 mV/m service to some portion of their authorized 1 mV/m  SR(service areas.ARD {O6!(ԍ See infra,  8.A In addition, AM stations will be able to propose changes in authorized hours of  S*(operation by filing minor change applications.* yO#(ԍ Proposals by AM stations to add nighttime service will be classified as minor changes. Proposed AM and NCE FM facility changes that would result in station class changes will be classified as minor changes provided that they meet the "f 0*&&))Z" abovestated standards. Amendments to applications also will be classified as minor in accordance  S(with these standards.    S(7. We recognize, as a general matter, the benefits of a processing policy that facilitates the  Sb(filing of mutually exclusive or competing applications,b {O(ԍ See Modification of FM and TV Authorizations to Specify a New Community of License, 4 FCC Rcd at  {O(4873, citing Cheyenne, Wyoming, 62 FCC 2d 63 (1976). and that these modifications will limit the opportunities for such filings. Nevertheless, we believe that the public interest weighs in favor of the measures we are adopting. The current policy of not providing cutoff protection to minor change applications in the AM, NCE FM and FM translator services exposes applicants to significant uncertainty, expense and delay, and may substantially deter applicants from seeking to improve service. The current broad classification of proposed technical facility changes as "major changes" in these services imposes on applicants administrative burdens and delays that we believe are unnecessary in light of the technical and minor nature of many such proposals. The measures that we are adopting here have made the commercial FM application process simpler, faster and more efficient, without undermining the administration of any Commission rule or policy. We anticipate that they will prove to be similarly beneficial in the AM, NCE FM and FM translator services, thereby encouraging potential applicants to file for improved facilities and speeding the introduction of improved services  S (to the public.IZ $ yOF(ԍ We concur with NPR that application of these measures to FM translators is appropriate: the secondary status of this service does not diminish the material improvement these measures will bring to the FM translator  {O(application process. See supra, n. 11. I  S2(8. Continuity of Service Requirement. We believe it is necessary to impose a continuity of service requirement on both NCE FM and FM translator stations proposing facility modifications.  S(Unlike commercial AM and FM stations,V\F {O(ԍ See supra,  6. No such requirement is necessary for commercial FM and AM stations because these stations presently are required to maintain 3.16 mV/m and 5 mV/m contours, respectively, over their  {O\(communities of license. See 47 C.F.R.  73.24(i), 73.315(a).V our rules have not required NCE FM and FM translator stations to provide any level of service to their communities of license. Our approach here provides NCE FM and FM translator stations with maximum flexibility in proposing facility changes, while preventing them from completely abandoning their present service areas. We anticipate that this restriction rarely will come into play, because stations have a disincentive to abandon existing service areas with established audiences; instead, they are to likely to propose service increases as a result of the rule changes we are adopting. Midsize and large NCE FM stations also are unlikely to be able to propose substantial coverage changes due to contour protection requirements, TV Channel 6 protection requirements and other limitations. In practice, therefore, only FM translators and small, Class A NCE FM stations are likely to be able to propose antenna location changes that approach the limit of this restriction. In such cases, the potential preclusive impact of a proposed change is limited by the small service area of the station involved, and we believe that our minor change application processing",j 0*&&))"  S(procedures provide adequate safeguards for public participation.\ {Oh(ԍ As discussed in the Notice, the Commission provides public notice of the tendering of minor change applications and the public has the opportunity to file informal objections and seek reconsideration of staff  {O(actions. See Notice, 13 FCC Rcd at 14871; 47 U.S.C.  405; 47 C.F.R.  1.106, 73.3564, 73.3587.  We note, however, that our  S(proposal in the Notice to require NCE FM stations to maintain 1 mV/m contours over at least a portion of their communities of license would impose an additional restriction on NCE FM station  S(antenna location changes.R {O(ԍ See Notice, 13 FCC Rcd at 1487576.R As an interim measure until the Commission acts on that proposal, we shall process proposed NCE FM antenna location changes as minor changes only if the proposed changes do not diminish the stations' present 1 mV/m service to their communities of license.   S(9. AM and NCE FM Community of License Changes. We decline to adopt the suggestion of several commenters that we treat community of license changes in the AM and NCE FM services as  S(minor changes.&~ {O(ԍ See supra, n. 13 and accompanying text. As mentioned earlier, FM translators, as a secondary service, are exempted from local service obligations and, therefore, may request community of license changes as minor  {OL(changes. 47 C.F.R.  74.1233; see Amendment of Part 74 of the Commission's Rules Concerning FM Translator  {O(Stations, Report and Order in MM Docket No. 88140, 5 FCC Rcd 7212, 7220 (1990). Unlike the proposed technical facility changes that we are reclassifying as minor changes, proposed AM or NCE FM community of license changes are not fundamentally technical in nature; rather, they raise important statutory and policy issues under Section 307(b) of the  S$ (Communications Act, issues that require substantive legal analysis.aZ$ l  {O0(ԍ See 47 U.S.C.  307(b) (obligating Commission to license broadcast facilities in a fair, efficient, and equitable manner). Under this statutory provision, the association of a broadcast station with a community of license is a basic tenet of the Commission's allocation scheme for broadcast stations. a As the commenters have pointed out, there is a procedure by which commercial FM licensees and permittees may request a new  S (community of license without being subject to mutually exclusive proposals.G  yO(ԍ 47 C.F.R.  1.420(i).G Such requests are not processed as minor change applications, however. Rather, this procedure takes place in the context of rule making proceedings to amend the FM table of allotments, and it ensures that proposed community  S\(of license changes receive the consideration warranted by their significance under Section 307(b).\ {O(ԍ Modification of FM and TV Authorizations to Specify a New Community of License, 4 FCC Rcd at 4873. In order to amend an allotment using this procedure, the Commission compares the proposed allotment plan to the existing state of allotments for the communities involved, applying FM allotment standards in order to determine whether adoption of the proposed allotment plan would result in a preferential distribution of radio services among the affected communities. Given the important statutory and policy issues raised by proposed community of license changes, we conclude that it would be inappropriate to reclassify them as minor changes for AM and NCE FM stations. "0*&&))"Ԍ S( 10. "Warehousing" concerns. With regard to the spectrum "warehousing" concerns expressed by some commenters, we are not persuaded that additional safeguards are necessary. The commenters' stated fears of widespread warehousing and other abuses have not come to pass in the  S(commercial FM service, notwithstanding size and resource disparities among broadcasters.$ {O(ԍ Cf. Applications of Temple University, FCC 98-128 at  12 (released June 29, 1998) ("public interest goals of furthering the prompt construction of broadcast facilities within a reasonable time frame and providing incentives for permittees to inaugurate new service as quickly as possible" apply equally to commercial FM and  {OL(NCE FM stations), quoting Golden Eagle, 6 FCC Rcd 5127, 5129 (1991).  Mechanisms for preventing abuse will continue to exist under the new rules, in the form of careful staff review of applications, the opportunity to file informal objections and seek reconsideration and  S(review of staff actions, and strict time limits on authorized construction periods. {Of (ԍ See 47 U.S.C.  1.106, 73.3564, 73.3587; 1998 Bienniel Regulatory Review Streamlining of Mass  {O0 (Media Applications, Rules and Processes, Report and Order in MM Docket No. 9843, 13 FCC Rcd ____ at  {O ( 7790 (released November 25, 1998) (modifying construction permit extension procedures); see also Matter of  {O (Revision of Sections 73.3571, 73.3572 and 73.3573 of the Commission's Rules, First Report and Order in MM Docket No. 831377, 56 Rad. Reg. 2d 941, 94344 (1984) (employing similar analysis in classifying commercial FM station facilities increases as minor changes).  In addition, the enhancements that an applicant may request are necessarily limited by the operation of stations on  S(adjacent and cochannels in neighboring communities and city grade coverage requirements.uZ4  {O(ԍ See 47 C.F.R.  73.37(a) (AM daytime contour protection requirements); 73.182(q) (AM nighttime contour protection requirements); 73.509 (NCE FM stations must protect 1 mV/m contour of NCE FM stations); 74.1204 (FM translators must protect primary service contours of existing FM and FM translator stations).u Furthermore, we do not believe that the new rules will operate to the unfair advantage of certain broadcasters. These are mature services and many licensees have had opportunities to evaluate and  SJ (file applications for enhanced facilities. As we observed in the Notice, prospective applicants have the ability to predict whether other area stations have the potential to seek facilities improvements based  S (on applicable contour protection requirements, and to file first for enhanced facilities.c V  {O(ԍ Notice, 13 FCC Rcd at 14872; see supra, n. 29.c Potential applicants in the AM, NCE FM and FM translator services have been on notice concerning these  S (proposals since the release of the Notice approximately six months ago and, therefore, have had ample opportunity to assess the availability of spectrum, their foreseeable needs and other factors that may enter into preparing and/or filing applications for improved facilities. We see no reason why this notice and opportunity should not prove sufficient to protect the expansion plans of broadcasters in  S(these services. yO (ԍ With regard to NPR's and VSoft Communications' suggestions regarding strict application of construction permit extension rules to address warehousing concerns, we note that the Commission recently adopted modified construction permit extension procedures lengthening the time period for construction and imposing strict criteria  {O"(for tolling the new extended construction period. See 1998 Biennial Regulatory Review Streamlining of Mass  {O#(Media Applications, Rules, and Processes, Report and Order in MM Docket 9843, 94149, FCC 98281 at  7790 (released November 25, 1998). "d0*&&))P"  S( ! II. AGREEMENTS INVOLVING APPLICATIONS  S( ,FOR COORDINATED FM STATION CHANGES ă  S( A. BACKGROUND ă  S8( 11. Proposed Rule Changes. Section 73.3517 of the Commission's rules prohibits the filing  S(of contingent new station and modification applications in the broadcast services. X yOz(ԍ 47 C.F.R.  73.3517. This section applies to all Part 73 broadcast services. Section 74.780 of the rules prohibits the filing of contingent TV translator, low power television and television booster stations. 47 C.F.R.  74.780. The Commission  S(first announced this policy in a 1961 Public Notice\! {Or (ԍ Public Notice, FCC 611286, 22 RR 299 (1961).\ and subsequently codified the restriction."z {O (ԍ Amendment of Section 1.517 and 1.520 of the Commission's Rules, Report and Order, 61 FCC 2d 238 (1976). It was adopted to bring greater administrative orderliness to the broadcast licensing process. The Commission found that it was frequently holding applications in pending status that were contingent  Sr(on the grant of other applications involved in lengthy hearings.4#Zr yO(ԍ "The volume of contingent applications, the long time they were on file, and their relationship to other  {O(pending applications all served to create a substantial administrative problem." Selma Television, Inc., 29 FCC 2d 522, 525 n.5 (1971).4 An application is "contingent" when it cannot be granted unless and until a second application, also pending before the Commission, is granted. In the FM service, Section 73.208 requires an applicant to protect all outstanding  S (construction permits and licenses.?$  yO(ԍ 47 C.F.R.  73.208.? Thus, when an FM application is contingent on the effectuation of a second station's facility modification application, in most instances the first station must wait for the grant of the second station's covering license application before filing a construction permit application. This rule effectively requires stations to undertake "coordinated" facility improvements through a series of application and construction cycles, a risky, lengthy and sometimes infeasible procedure, particularly where a station downgrade or facility relocation is required to permit expanded service by a second station.  S( 12. In the Notice we proposed to permit on a limited basis the filing of contingent  S(applications.O%  {O (ԍ See Notice, 13 FCC Rcd at 14856.O Specifically, we proposed to amend the rules to allow parties to submit up to four  Sl("related"@&l {O$#(ԍ See infra, n. 43.@ minor change FM construction permit applications, including onestep upgrade and  SD(downgrade applications. We asked whether a different number of applications should be permitted where stations are under common ownership. With regard to NCE FM stations, we noted some" &0*&&))<" concern about coordinated facility changes that would result in the loss of a community's only NCE FM transmission service. Nevertheless, we tentatively proposed to permit such proposals, provided no  S(gray or white area would be created.' yO(ԍ A "white" area receives no fulltime aural service, a "gray" area receives one fulltime aural service. We also asked for comment on whether to establish additional NCE FM local service floor requirements. We proposed to grant proposals that meet these criteria and are otherwise in the public interest. Stations seeking to take advantage of these new procedures would be required to file all applications on the same day and include in each application a copy of the agreement that references all related applications. Applications would be processed as a group and granted simultaneously. If any of the applications is unacceptable, the entire group of applications would be dismissed.  Sp( 13. Overview of Comments. Most commenters strongly support increased flexibility for  SJ (coordinated FM station facility improvements.(J X {OB (ԍ See comments and reply comments of the Association of Federal Communications Consulting Engineers ("AFCCE"), NAB, du Treil Lundin & Rackley, Inc. ("du Treil"), Graham Brock, Inc. ("Graham Brock"), Communications Technologies, Inc. ("CTI"), Reynolds Technical Associates, FullerJeffrey Broadcasting Companies, Inc., West Virginia Radio Corporation ("WVRC"), Big River Broadcasting Corporation, The Rutherford Group, Inc., Hardy & Carey and NPR.  Several commenters favor permitting groups of more  S" (than four related applications.z)"  {O(ԍ See comments of CTI, WVRC, and Graham Brock and reply comments of Reynolds.z Reynolds proposes that applicants be given a 30day period to cure  S (application defects, arguing that the "harsh" dismissal procedure proposed in the Notice could generate greenmail opportunities by subsequentlyfiled blocking applications. The Rutherford Group, Inc., licensee of WGNS(AM), Rutherford, Tennessee ("WGNS"), requests that standalone AM stations be permitted to use FM translators to improve service in their communities of license. One commenter, D. Michael Self Broadcasting ("Self"), argues that permitting contingent applications could thwart the  S4(objectives of Section 307(b) of the Communications Act.*X4 yOp(ԍ 47 U.S.C.  307(b) (mandating that "the Commission shall make such distribution of licenses . . . among the several states and communities as to provide for a fair, efficient and equitable distribution of radio service. . . .").  This would occur, contends Self, where contingent service improvements are authorized that would block mutually exclusive and Section 307(b)preferred proposals. No commenter opposes the proposal to permit the cancellation of NCE FM licenses. However, NPR urges the Commission to carefully consider all proposed service  S(reductions, including changes in public radio service levels. NPR also supports the Notice proposal to prohibit NCE FM license cancellations that would create white or gray areas. du Treil requests that we make clear that a white/gray area analysis in this context should consider only NCE FM services. Reynolds argues that alternative signal propagation models should be permitted to determine whether a proposal would create gray or white areas." *0*&&))"  S(+ B. DISCUSSION  S(  14. We continue to believe that certain revisions to our contingent application rule are  S(warranted and that the proposal set forth in the Notice strikes a proper balance between the desire of broadcasters for additional flexibility and the limited staff resources that are available to review the substantially more complex facilities change applications that these rule changes will permit. Based on the record developed in this proceeding, we shall adopt rule changes to permit applicants to file up to  S(four related,>+X yOR(ԍ Two applications are "related" if the grant of one is necessary to permit the grant of the second application. Thus, the "lead" application in a group typically will not be "contingent" on any other application but nevertheless will be counted as a "related" application. > simultaneouslyfiled and crossreferenced minor change FM station construction permit  S(applications., yOJ (ԍ We adopt no change in our current policy of not accepting any application filed "contingent" on the grant of a license application to cover an outstanding permit of another station. We believe that it is prudent to limit the scope of these new procedures, both to limit the potential for significant service losses and/or disruptions and to ensure that there is sufficient staff to complete review of interrelated proposals expeditiously. Thus, we exclude major change  SJ (applications. Proposals may include onestep upgrade and downgrade applications.9-J @ {O*(ԍ We take this opportunity to correct the erroneous statement in the Notice that when a onestep FM construction permit application is granted, the formerlyauthorized facilities are no longer protected from  {O(subsequently filed applications. See Notice, 13 FCC Rcd at 14855, n. 22. Piedmont Broadcasting Corporation correctly notes that when a onestep application is granted to downgrade an existing FM authorization to a lower class, the Commission will continue to protect the authorized facilities until the modified facilities are licensed.  {O(See Revision of Section 73.3573(a)(1) of the Commission's Rules Concerning the Lower Classification of an FM  {O(Allotment, 4 FCC Rcd 2413, 2415 (1989).9 Applicants will be required to submit a copy of the agreement to undertake the coordinated facility changes with each application. Applications will be processed together and, if grantable, will be granted simultaneously. Granted applications will contain conditions, as necessary, to prevent interference during the construction period leading to full implementation of all related facility modifications. If one or more applications is unacceptable, all related applications will be dismissed. Thus, the staff will dismiss an otherwise grantable noncontingent "lead" application if a related contingent application is found to be unacceptable.  S(15. We reject the suggestion that we permit the filing of more than four related applications, even if the stations are under common ownership. We are concerned about the technical complexity of proposals that involve more than four station changes. Furthermore, we believe that the likelihood of an unforeseen event precluding the effectuation of a coordinated facility change increases with the number of interdependent proposals. Accordingly, we also are concerned that significant Commission resources may be expended processing proposals that would never be constructed if we were to permit the filing of more than four related applications.  S(16. We believe a strict dismissal policy is warranted. The plain quid pro quo for creating this greater technical flexibility for broadcasters is that applicants bear sole responsibility for developing"| -0*&&))" proposals that fully comply with the Commission's rules. However, we wish to correct Reynolds' erroneous assumption in its comments that applicants would be prohibited from filing curative amendments. Our current commercial and NCE FM amendment procedures will apply to contingent  S(applications..$ yO(ԍ Commercial FM application amendment procedures are set forth at 47 C.F.R.  73.3564. An NCE FM  {O(applicant is given one opportunity to cure all acceptability defects and resubmit its application nunc pro tunc.  {M(See Commission States Future Policy on Incomplete and Patently Defective AM and FM Construction Permit  {OJ(Applications, Public Notice, FCC 84366, 49 Fed.Reg. 47331 (released August 2, 1984). The one processing policy change is that the staff will dismiss all related applications if one application remains unacceptable after the opportunity for filing curative amendments has closed.  S(17. We find unpersuasive Self's Section 307(b) arguments against this proposal. The  S(Commission has faced similar policy concerns previously../\ {O (ԍ See, e.g., Modification of FM and TV Authorizations to Specify a New Community of License, 4 FCC Rcd  {O (at 4870; Modification of FM Broadcast Licenses to Higher Class Cochannel or Adjacent Channels, 60 RR 2d 114 (1986).. Then, as now, we recognized the potential benefits of permitting the filing of competing proposals and that a processing rule which limits the  Sr(opportunity to file mutually exclusive applications is prima facie inconsistent with this statutory mandate. Nevertheless, we concluded that the public interest was better served by promoting FM  S$ (license upgrades and certain FM and TV city of license modifications.`0$  {O(ԍ See 47 C.F.R.  1.420(g)(3) and 1.420(i).` With regard to the contingent  S (application issues discussed in the Notice, Section 73.3517 discourages coordinated facility changes that could increase service. Furthermore, permitting contingent applications does not, as a practical  S (matter, deprive potential applicants and/or rulemaking petitioners of bona fide filing opportunities.  S (Broadcasters will undertake coordinated facility improvements based on the assumption that each of the interrelated modifications can, and will, be built. A potential applicant's "opportunity" to file a competing proposal is premised on the conflicting assumption that these broadcasters would make some but not all of the changes in the facilities improvement package. We conclude that the public interest benefits of a rule change to permit coordinated FM station service improvements outweighs any concern that such improvements may preclude theoreticallyfavored but unachievable competing  S(service proposals.1j  yO(ԍ WGNS's FM translator station fillin proposal, which is outside the scope of this proceeding, also is being  {Ol(separately considered. See Public Notice, DA 982527 (released December 10, 1998).  Sr(18. Finally, with regard to contingent NCE FM applications, we will permit proposals that  SJ(include station cancellations except those that would create gray or white areas, i.e., areas that receive service from one or no NCE FM stations, respectively. Although we decline to establish other fulltime NCE FM service floor guidelines, any proposal to cancel a community's sole NCE FM station  S(license, i.e., its sole transmission service, will be treated as prima facie inconsistent with the public interest and must include a public interest justification. We will consider Reynolds' proposal to permit alternative signal propagation methodologies to measure NCE FM service levels in a subsequent order  S^(in this proceeding in connection with our evaluation of the supplemental pointtopoint ("PTP") signal"^ 10*&&))"  S(propagation model.D2 {Oh(ԍ We note, however, that we proposed in the Notice to limit the PTP methodology to certain narrow  {O2(circumstances. Notice, 13 FCC Rcd at 1486465. Moreover, we tentatively rejected the use of this model to determine the number of available signals for purposes of complying with the multiple ownership requirements  {O(of Section 73.3555, a context similar to that which Reynolds proposes here. 47 C.F.R.  73.3555; see Notice, 13  {O(FCC Rcd at 1486465.D   S(  III. PROCEDURAL MATTERS AND ORDERING CLAUSES  x  S`(19. Effective Date. The new procedures we are adopting will become effective 30 days after the date of publication of this Order in the Federal Register. We believe that this 30day period will provide adequate notice and opportunity to potential applicants, while expediting the benefits to the public of the new procedures.  S(20. In order to ensure a smooth transition to the new procedures, we wish to clarify our procedures for processing applications filed prior to the effective date that are subject to the Order.  SJ (First, with regard to applications originally filed as minor changes, as of the effective date they will be accorded cutoff protection based on their actual filing dates, provided that they are not mutually  S (exclusive with any other applications filed prior to the effective date. Mutually exclusive applications will be handled under our existing procedures. Second, with regard to major change applications subject to reclassification as minor changes, as of the effective date such applications will be  S (reclassified automatically as minor changes, provided that: (1) they are not mutually exclusive with any other applications filed prior to the effective date; and (2) no petition to deny was filed against them in accordance with the requirements of Section 309(d) of the Communications Act prior to the  S (effective date.93~  {O*(ԍ 47 U.S.C.  309(d); see 47 C.F.R.  73.3584. Reclassified applications will be accorded cutoff protection as of their actual filing dates. Applicants whose applications are so reclassified may seek refund of the difference between fees paid for major and minor change application processing through the Office of the Managing Director, and will be deemed entitled to such refunds under 47 C.F.R.  1.1113(a)(4). AM and FM translator major change applicants seeking waiver of the Commission's interim policy concerning processing of  {O(such applications will not be reclassified automatically. See Notice of Proposed Rule Making in MM Docket No.  {O(97234, 12 FCC Rcd at 22388; infra, n. 53 and accompanying text.9 Applications that fail to satisfy these two conditions will be handled under our  S(existing application processing procedures.4  {OH(ԍ See 47 C.F.R.  73.3564(d), 73.3571(c), 73.3573(d). For applications in this category that have not achieved cutoff protection, we will announce by public notice "B" cutoff list filing periods for the acceptance of petitions to deny only, and thereafter process them under our existing procedures. We shall not issue any "A" cutoff lists for the acceptance of competing applications, because to do so would be inconsistent with our purpose of reducing unnecessary administrative burdens and delays associated with certain proposed technical  yO2"(facility changes.  AM and FM translator applicants with major change applications on file that seek waiver of the Commission's interim policy concerning processing of such applications may request dismissal of their applications and resubmit minor change applications as of" @40*&&))"  S(the effective date of the Order.V5B {Oh(ԍ See Notice of Proposed Rule Making in MM Docket 97234, 12 FCC Rcd at 22388 (imposing temporary freeze on the filing of major change applications in all commercial broadcast and secondary broadcast services). Such applicants may seek refund of their application processing fees through the Office of the Managing Director, and will be deemed entitled to such refunds under 47 C.F.R.  1.1113(a)(4). If any such applications remain pending following the effective date, we will consider the waiver requests and, should they demonstrate compelling grounds for waiver, process the applications in accordance with the abovestated standards. No waivers will be granted on the ground that an application is subject to reclassification as a minor change as of the effective date of the Order. V Finally, applications pending as of the adoption date of the Order and seeking waivers of Section 73.3517 will be considered on a casebycase basis. Contingent applications filed between the adoption and effective dates of the Order shall be returned.   S`(21. Paperwork Reduction Act of 1995 Analysis. The action contained herein has been analyzed with respect to the Paperwork Reduction Act of 1995 and found to impose new or modified reporting and recordkeeping requirements or burdens on the public. Implementation of these new or modified reporting and recordkeeping requirements will be subject to approval by the Office of Management and Budget as prescribed by the Act.  Sr(22. The Final Regulatory Flexibility Analysis, pursuant to the Regulatory Flexibility Act, 5 U.S.C.  604, is contained in Appendix B.  S (23. Accordingly, IT IS ORDERED that, pursuant to the authority contained in Sections 4(i), 4(j), 303, 308 and 309 of the Communications Act of 1934, as amended, 47 U.S.C.  4(i), 4(j), 303, 308 and 309, Sections 73.3517, 73.3571, 73.3573 and 74.1233 of the Commission's rules, 47 C.F.R.  73.3517, 73.3571, 73.3573 and 74.1233, ARE AMENDED as set forth in Appendix C.  S2(24. IT IS FURTHER ORDERED that the rule amendments set forth in Appendix C WILL  S (BECOME EFFECTIVE 30 days after their publication in the Federal Register, and the information  S(collection contained in these rules will become effective 30 days after publication in the Federal  S(Register, following Office of Management and Budget approval, unless a notice is published in the  S(Federal Register stating otherwise.  SJ(25. IT IS FURTHER ORDERED that the Commission's Office of Public Affairs, Reference  S"(Operations Division, SHALL SEND a copy of this First Report and Order, including the Final Regulatory Flexibility Analysis, to the Chief Counsel for Advocacy of the Small Business"50*&&))n" Administration. ` `  ,hhhFEDERAL COMMUNICATIONS COMMISSION ` `  ,hhhMagalie Roman Salas ` `  ,hhhSecretary"50*&&))x"  S(  @A-@ APPENDIX A   LIST OF COMMENTERS AND REPLY COMMENTERS REGARDING THE SUBJECT  S(D PROPOSALS IN MM DOCKET No. 9893. x  S(X` hp x (#%'0*,.8135@8: