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Formula Presumptionspp"(#22  S8-` ` 2. Restrictions on Services Provided over Pole Attachmentspp"(#26  S -` ` 3. Wireless Attachmentspp"(#36  S -` ` 4. Allocating the Cost of Other than Usable Spacepp"(#43  S!-` `  a. Method of Allocationpp"(#43  S"-` `  b.Counting Attaching Entitiespp"(#45  Sp#-` `  (1)hhCTelecommunications Carriers, Cable ` `  hhCOperators and NonIncumbent LECspp"(#45  S %-` `  (2)hhCPole Owners Providing Telecommunications ` `  hhCServices and Incumbent LECspp"(#46  S&-` `  (3)hhCGovernment Attachmentspp"(#52  S'-` `  (4)hhCSpace Occupied on Polepp"(#55 "(,**880*"Ԍ S-x` `  c.Overlashingpp"(#L59  S-x` `  (1)hhBackgroundpp"(#L59  S-x` `  (2)hhDiscussionpp"(#L61  S-x` `  hh(a)@Overlashing One's Own Pole x` `  hh@Attachmentpp"(#L61  S8-x` `  hh(b)@Third Party Overlashingpp"(#L65  S-x` `  hh(c)@Lease and Use of Excess Capacity/ x` `  hh@Dark Fiberpp"(#L70  S-x` `  d.Presumptive Average Number of Attaching Entitiespp"(#L74  S-x` ` 5. Allocating the Cost of Usable Spacepp"(#L80  Sp-x` `  a.Backgroundpp"(#L80  SH -x` `  b.Discussionpp"(#L83  S -x` `  (1)hhApplying the 13.5 Foot Presumption x` `  hhand the One Foot Presumption to x` `  hhTelecommunications Carrierspp"(#L83  S -x` `  (2)hhOverlashing and Dark Fiberpp"(#L92  S -xB.` ` Application of the Pole Attachment Formula to x` ` Telecommunications Carrierspp"(#L96  S0-xC.` ` Application of the Pole Attachment Formula to Conduitsp"(#F103  S-x` ` 1. Backgroundp"(#F103  S-x` ` 2. Discussionp"(#F107  S-x` `  a.Counting Attaching Entities for Purposes of x` `  Allocating Cost of Other than Usable Space p"(#F107  Sh-x` `  b.Unusable Space in a Conduit Systemp"(#F108  S@-x` `  c.HalfDuct Presumption for Determining Usable x` `  Conduit Spacep"(#F112  S-x` `  d.Conduit Pole Attachment Formulap"(#F116  S-xD.` ` RightsofWayp"(#F117  S-V.xCost Elements of the Formula for Poles and Conduitp"(#F122  Sx-VI.xImplementation and Effective Date of Rulesp"(#F125  SP-VII.xFinal Regulatory Flexibility Act Analysisp"(#F131  S(-VIII.xPaperwork Reduction Act of 1995 Analysisp"(#F171  S-IX.xOrdering Clausesp"(#F173  S-Appendix A:` ` Revised Rules  S-Appendix B:` ` List of Commenters "8,`(`(88 "  S- F$F I.xINTRODUCTION  S- ` x1.` ` In this Report and Order ("Order"), the Commission adopts rules implementing Section  S- x703 of the Telecommunications Act of 1996 ("1996 Act")s} yO-ԍPub. L. No. 104104, 110 Stat. 61, 149151, codified at 47 U.S.C.  224.s relating to pole attachments.axX} yO- xԍSection 703 amended Section 224 of the Communications Act. Currently Section 224 defines "pole attachment"  xas any attachment by a cable television system or provider of telecommunications service to a pole, duct, conduit  xJor rightofway owned or controlled by a utility. 47 U.S.C.  224(a)(4). Section 224 defines "utility" as any person  x-who is a local exchange carrier or an electric, gas, water, steam or other public utility, and who owns or controls  x<poles, ducts, conduits or rightsofway used, in whole or in part, for any wire communications, not including any  xrailroad, any person who is cooperatively organized, or any person owned by the federal government or any state. 47 U.S.C. 224(a)(1).a Section 703  x/requires the Commission to prescribe regulations to govern the charges for pole attachments used by  S:- xtelecommunications carriers to provide telecommunications services.A:} yOr-ԍ47 U.S.C. 224(e)(1).A Section 703 also requires that the  xCommission's regulations ensure that a utility charges just, reasonable, and nondiscriminatory rates for  S- x-pole attachments.1( } {O-ԍId.1 We adopt the rules set forth in Appendix A hereto based upon the comments and reply  S- xcomments filed in response to the Notice of Proposed Rulemaking in this docket (the "Notice"). } {O- x;ԍNotice of Proposed Rulemaking, CS Docket No. 97151, 12 FCC Rcd 11725 (1997). In addition, to the extent  {O- x.relevant, we have considered the comments and reply comments filed in response to the Notice of Proposed  {O- x-Rulemaking in CS Docket No. 9798 relating to the existing formula for pole attachments. Notice of Proposed  {Oz- xRulemaking, CS Docket No. 9798 (Amendment of Rules and Policies Governing Pole Attachments), 12 FCC Rcd  {OD- x7449 (1997) ("Pole Attachment Fee Notice"). The Pole Attachment Fee Notice specifically seeks comment on the  xxCommission's use of the current presumptions, on carrying charge and rate of return elements of the formula, on the use of gross versus net data and on a conduit methodology. A list  S- xzof commenters, as well as the abbreviations used in this Order to refer to such parties, is contained in  xAppendix B hereto. The commenters generally represent the interests of one of the following three  SN -categories: (1) utility pole owners;] N } yO- xZԍCommenting utility pole owners generally include American Electric, et al., Carolina Power, et al., Colorado  xSprings Utilities, New York State Investor Owned Electric Utilities, Dayton Power, Duquesne Light, Edison Electric/UTC, Ohio Edison, Texas Utilities and Union Electric.] (2) cable operators;N } yO - xԍCommenting cable operator interests generally include Adelphia, et al., New York Cable Television Assn., Comcast, et al., NCTA, SCBA and Summit. and (3) telecommunications carriers.DXN D} yO2#- xԍCommenting telecommunications carrier interests generally include Ameritech, AT&T, Bell Atlantic, BellSouth,  xwChamplain Valley Telecom, et al., GTE, ICG Communications, KMC Telecom, MCI, Omnipoint, RCN, SBC, Sprint, Teligent, USTA, US West and Winstar.D  S -  F$F " d,`(`(88 "  S- F$F II.xBACKGROUND  S- ` _x2.` ` The purpose of Section 224 of the Communications Act } yO- xԍPub. L. No. 95234 ("1978 Pole Attachment Act") codified at Communications Act of 1934, as amended ("Communications Act"), 224, 47 U.S.C.  224. is to ensure that the deployment  xyof communications networks and the development of competition are not impeded by private ownership  xjand control of the scarce infrastructure and rightsofway that many communications providers must use  S8- xMin order to reach customers. 8 } {O- xԍS. Rep. No. 580, 95th Cong., 1st Sess. 19, 20 (1977) ("1977 Senate Report"), reprinted in 1978 U.S.C.C.A.N. 109, 121. The rules we adopt in this Order further the procompetitive goals of  xSection 224 and the 1996 Act by giving incumbents and new entrants in the telecommunications market  x fair and nondiscriminatory access to poles and other facilities, while safeguarding the interests of the  S-owners of those facilities.  S-  Sr- ` #x3.` ` As originally enacted, Section 224 was designed to ensure that utilities' control over poles  xand rightsofway did not create a bottleneck that would stifle the growth of cable television. Congress  xksought to prohibit utilities from engaging in "unfair pole attachment practices . . . and to minimize the  xeffect of unjust or unreasonable pole attachment practices on the wider development of cable television  S - xLservice to the public."1 z} {O-ԍId.1 As mandated by Section 224, the Commission established a formula to calculate  S - x\maximum rates that utilities could charge cable operators for the installation of attachments on utility  S - xfacilities where such rates are not regulated by a state.  } {O.- xԍFirst Report and Order (Adoption of Rules for the Regulation of Cable Television Pole Attachments), CC  {O- xDocket No. 78144, 68 FCC 2d 1585 (1978) ("First Report and Order"); see also Second Report and Order, 72 FCC  {O- xx2d 59 (1979) ("Second Report and Order"); Third Report and Order, 77 FCC 2d 187 (1980) ("Third Report and  {O- xxOrder"), aff'd Monongahela Power Co. v. FCC, 655 F.2d 1254 (D.C. Cir. 1985) (per curiam); Report and Order,  xwCC Docket No. 86212 (Amendment of Rules and Policies Governing the Attachment of Cable Television Hardware  {O- xto Utility Poles), 2 FCC Rcd 4387, 43874407 (1987) ("Pole Attachment Order"), recon. denied, 4 FCC Rcd 468 (1989). In subsequent proceedings the Commission  SZ-amended and clarified its methodology for establishing rates and its complaint process. ZV } {OP- xԍSecond Report and Order, 72 FCC 2d 59; Memorandum Opinion and Order (Petition to Adopt Rules  {O- xConcerning Usable Space on Utility Poles, RM 4556), FCC 84325 (released July 25, 1984) ("Usable Space Order");  {O- x;see also Alabama Power Co. v. FCC, 773 F.2d 362 (D.C. Cir. 1985) (upholding challenge to the Commission's pole  {O- xattachment formula relating to net pole investment and carrying charges). Following Alabama Power, the  {Ox -Commission revised its rules in the Pole Attachment Order, 2 FCC Rcd 4387. x  S - ` x4.` ` The 1996 Act amended Section 224 in several important respects. While previously the  x[protections of Section 224 had applied only to cable operators, the 1996 Act extended those protections  S- xto telecommunications carriers as well.;} yOj%-ԍ47 U.S.C.  224.; Further, the 1996 Act gave cable operators and  xtelecommunications carriers a mandatory right of access to utility poles, in addition to maintaining a",`(`(88"  S- xscheme of rate regulation governing such attachments.D} yOh-ԍ47 U.S.C.  224(a), (f). D In the Local Competition Order, we adopted a  S-number of rules implementing the new access provisions of Section 224. JX} {O- xԍFirst Report and Order, CC Docket No. 9698 (Implementation of the Local Competition Provisions in the  {O- xX Telecommunications Act of 1996), 11 FCC Rcd 15499, 16058107, paras. 11191240 (1996) (the "Local Competition  {Of- xwOrder"), rev'd on other grounds, Iowa Utilities Board v. FCC, 120 F.3d 753 (8th Cir. 1997), cert. granted sub nom.,  {O0- x;AT&T Corp. v. Iowa Utilities Board, 66 U.S.L.W. 3387, 66 U.S.L.W. 3484, 66 U.S.L.W. 3490 (U.S. Jan. 26, 1998)  x (No. 97826, 97829, 97830, 97831, 971075, 971087, 971099, 971411). In August 1996, the Commission also  {O- xissued a Report and Order in CS Docket No. 96166 (Implementation of Section 703 of the Telecommunications  xAct of 1996), 11 FCC Rcd 9541 (1996), amending its rules to reflect the selfeffectuating additions and revisions to Section 224.   S- ` x5.` ` As amended by the 1996 Act, Section 224 defines a utility as one "who is a local  xexchange carrier or an electric, gas, water, steam, or other public utility and who owns or controls poles,  S:- xducts, conduits, or rightsofway used, in whole or in part, for wire communications.">:j } yOD-ԍ47 U.S.C.  224(a).> The 1996 Act,  x?however, specifically excluded incumbent local exchange carriers ("ILECs") from the definition of  S- xtelecommunications carriers with rights as pole attachers.B } yO-ԍ47 U.S.C. 224(a)(5). B Because, for purposes of Section 224, an ILEC  x[is a utility but is not a telecommunications carrier, an ILEC must grant other telecommunications carriers  xand cable operators access to its poles, even though the ILEC has no rights under Section 224 with respect  x0to the poles of other utilities. This is consistent with Congress' intent that Section 224 promote  SJ -competition by ensuring the availability of access to new telecommunications entrants.J } {Ot- xԍConference Report to S. 652 and Joint Explanatory Statement of the Committee of Conference, 104th Cong.,  {O>-2d Sess. 98100, 113 ("Conf. Rpt.").  S - ` qx6.` ` Section 224 contains two separate provisions governing maximum rates for pole  x/attachments, one of which covers attachments used to provide cable service and one of which covers  xOattachments for telecommunications services (including attachments used jointly for cable and  xtelecommunications). Section 224(b)(1), which was not amended by the 1996 Act, grants the Commission  xauthority to regulate the rates, terms, and conditions governing pole attachments for cable service to ensure  S2- xthat they are just and reasonable.B2} {O- xԍCf. 47 U.S.C.  224(c)(1). The Commission does not have authority where a state regulates pole attachment  xrates, terms, and conditions. Section 224(c)(3) directs that jurisdiction for pole attachments reverts to the  x[Commission generally if the state has not issued and made effective rules implementing the state's regulatory  xauthority over pole attachments. Reversion to the Commission also occurs, with respect to individual cases, if the  xstate does not take final action on a complaint within 180 days after its filing with the state, or within the applicable  x-period prescribed for such final action in the state's rules, as long as that prescribed period does not extend more than 360 days beyond the complaint's filing. 47 U.S.C.  224(c)(3). Section 224(d)(1) defines a just and reasonable rate as ranging from"2,`(`(88"  S- xthe statutory minimum (incremental costs) to the statutory maximum (fully allocated costs).A} yOh-ԍ47 U.S.C.  224(d)(1).A Incremental  xcosts include preconstruction survey, engineering, makeready and changeout costs incurred in preparing  S- xfor cable attachments.X} yO- xԍ"Makeready" generally refers to the modification of poles or lines or the installation of guys and anchors to  {Op- xwaccommodate additional facilities. See 1977 Senate Report at 19. A pole "changeout" is the replacement of a pole  {O:- xto accommodate additional users. Pole Attachment Order, 2 FCC Rcd at 4405 n.3. Congress expected pole  x;attachment rates based on incremental costs to be low because utilities generally recover the makeready or change {O-out charges directly from cable systems. See 1977 Senate Report at 19. Fully allocated costs refer to the portion of operating expenses and capital costs  xjthat a utility incurs in owning and maintaining poles that is equal to the portion of usable pole space that  S`-is occupied by an attacher.;`} {O -ԍId. at 1920.;  S- ` x7.` ` Separately, Section 224(e)(1), the subject of this Order, governs rates for pole attachments  xused in the provision of telecommunications services, including single attachments used jointly to provide  xLboth cable and telecommunications service. Under this section, the Commission must prescribe, no later  xthan two years after the date of enactment of the 1996 Act, regulations "to govern charges for pole  xattachments used by telecommunication carriers to provide telecommunications services, when the parties  SJ - x[fail to resolve a dispute over such charges."pJ } yO-ԍ47 U.S.C.  224(e)(1). The 1996 Act was enacted on February 8, 1996.p Section 224(e)(1) states that such regulations "shall ensure  S" - xMthat a utility charges just, reasonable, and nondiscriminatory rates for such pole attachments."1" 0 } {O-ԍId.1 The  x_section also sets forth a transition schedule for implementation of the new rate formula for  xtelecommunications carriers. Until the effective date of the new formula governing telecommunications  xattachments, the existing pole attachment rate methodology of cable services is applicable to both cable  S -television systems and to telecommunications carriers.  } yO- xԍ47 U.S.C. 224(d)(3); 47 C.F.R.  1.1401. Pursuant to Section 224(d)(3), the current formula will continue  xto be applicable to cable systems providing only cable service and, until February 8, 2001, to cable systems and  xtelecommunications carriers providing telecommunications services. See Section VI below regarding the implementation and the effective date of the rules we adopt herein.  S2- ` Ax8.` ` In the Notice, the Commission sought comment on implementing a methodology to ensure  S - xjust, reasonable, and nondiscriminatory maximum pole attachment and conduit } yOV!- xԍA conduit is a pipe placed in the ground through which cables are pulled. FCC ARMIS Operating Data Report, FCC Report 4308 (January 1992). rates for  S- xtelecommunications carriers.[} {O$-ԍNotice, 12 FCC Rcd at 1173940, paras. 3641.[ Under the present formula, a portion of the total annual cost of a pole is  xincluded in the pole attachment rate based on the portion of the usable space occupied by the attaching",`(`(88"  S- x>entity._} {Oh-ԍSee Third Report and Order, 77 FCC 2d 187 (1980)._ Under the 1996 Act's amendments, the portion of the total annual cost included in the pole  xattachment rate for cable systems and telecommunications carriers providing telecommunications services  xwill be determined under a more delineated method. This method allocates the costs of the portion of the  xtotal pole cost associated with the usable portion of the pole and the portion of the total pole cost  x/associated with the unusable portion of the pole in a different manner. The Commission also sought  x|comment on how to ensure that rates charged for use of rightsofway are just, reasonable, and  S-nondiscriminatory.XZ} {O -ԍNotice, 12 FCC Rcd at 11740, paras. 4243.X  S- ` x9.` ` The rules we adopt today implement the plain language of Section 224. That section  xprovides that the regulations promulgated will apply "when the parties fail to resolve a dispute over such  Sp- xcharges."Ap} yO -ԍ47 U.S.C.  224(e)(1).A Accordingly, and as discussed below, we encourage parties to negotiate the rates, terms, and  x.conditions of pole attachment agreements. Although the Commission's rules will serve as a backdrop to  xsuch negotiations, we intend the Commission's enforcement mechanisms to be utilized only when good  xfaith negotiations fail. Based on the Commission's history of successful implementation and enforcement  xof rules governing attachments used to provide cable service, we believe that the new rules we adopt today  xwill foster competition in the provision of communications services while guaranteeing fair compensation for the utilities that own the infrastructure upon which such competition depends.  S- III.XxPREFERENCE FOR NEGOTIATED AGREEMENTS(#  S-xAND COMPLAINT RESOLUTION PROCEDURES  S-  S-xA.` ` Background   S@-x 10.` ` The 1996 Act amended Section 224 by adding a new subsection (e)(1) to:  ` $XxX` ` . . . govern the charges for pole attachments used by telecommunications providers to  ` provide telecommunications services when the parties fail to resolve a dispute over such  ` 5charges. Such regulations shall ensure that a utility charges just, reasonable and  Sx-nondiscriminatory rates for pole attachments.C x|} yO-ԍ47 U.S.C.  224(e)(1). C(#`  S(- xThe statute,W!( } yO"-ԍ47 U.S.C.  224(b)(1), (d)(1), (e)(1). W legislative policy,h"(} {Od$- 1977 Senate Report at 1920; Conf. Rpt. at 205207.h administrative authority,#^(. } {O%- xԍFirst Report and Order, 68 FCC 2d 1585 (setting initial rules for the complaint process, formula elements and  {O&- xthe use of historical costs); Second Report and Order, 72 FCC 2d 59 (setting spatial presumptions and defined  {O'- xincremental and fully allocated costs for use in formula); Third Report and Order, 72 FCC 2d 187, aff'd"'",`(`('"  {O- xMonongahela Power Co. v. FCC, 655 F.2d 1254; Pole Attachment Order, 2 FCC Rcd 4387, recon. denied, 4 FCC Rcd 468. and current industry practices$("} {O-ԍSee, e.g., Carolina Power, et al., Comments at 11; NCTA Comments at 47; USTA Reply at 2. all make"($,`(`(88{"  xyprivate negotiation the preferred means by which pole attachment arrangements are agreed upon between  S- xa utility pole owner and an attaching entity.%} yO,- xJԍFrom 1979, when the first pole attachment complaint was filed with the Commission, to 1991, approximately  x246 pole attachment complaints were filed. From 1991 through 1996, approximately 44 such complaints were filed.  xKCurrently, there are seven pole attachment complaints under review by the Commission's Cable Services Bureau.  xWe view this number of complaints to the Commission, in light of the penetration of cable service in the nation's communities, to be indicative that most pole attachment rates are negotiated without resort to the Commission. Pursuant to the Commission's authority to provide for just,  S- xreasonable, and nondiscriminatory rates, terms and conditions for pole attachments,W&d } yO -ԍ47 U.S.C.  224(b)(1), (e)(1), (f)(1). W attaching entities  xhave recourse to the Commission when unable to resolve a dispute with a utility pole owner. The  S`- xCommission's rules establish a specific complaint process.K'` } yO-ԍ47 C.F.R.  1.14011.1416. K Under the current rule, in reviewing a  xcomplaint about rates, the Commission will compare the utility's proposed rate to a maximum rate  S-calculated using the statutory formula.C( } yO4-ԍ47 U.S.C.  224(d)(1). C  S- ` x 11.` ` In proposing a methodology to implement Section 224(e), the Commission stated in the  S- xNotice that the Commission's role is limited to circumstances when the parties fail to resolve a dispute  xand that negotiations between a utility and an attacher should continue to be the primary means by which  SJ - xpole attachment issues are resolved.V)J } {O-ԍNotice, 12 FCC Rcd at 11731, para. 12. V The Commission also indicated that Congress recognized the  ximportance of access in enhancing competition in telecommunications markets and that parties in a pole  S - xattachment negotiation do not have equal bargaining positions.2* } {O@-ԍId. 2 To further Congressional intent to foster  xcompetition in telecommunications, the Commission proposed to apply to telecommunications carriers the  xLCommission's existing complaint rules developed to resolve pole attachment rate disputes between cable  S -operators and utilities.t+Z 8} {OZ - xԍId. The current complaint rule provides that "[t]he complaint shall include a brief summary of all steps taken  xxto resolve the problem prior to filing. If no such steps were taken, the complaint shall state the reason(s) why it believed such steps were fruitless." 47 C.F.R.  1.1404(i). t  S2- ` 2x 12.` ` Some telecommunications carriers and utility pole owners agree that negotiations between  xa utility and an attaching entity will continue, under Section 224(e), to be the primary means by which" Z+,`(`(88"  S- xypole attachment issues are resolved.&,$} {Oh- xԍSee Bell Atlantic Reply at 2 (negotiation is essential means to establish just and reasonable rates for pole  xI attachments); Carolina Power, et al., Reply at 11 (private negotiations are the cornerstone of attachment agreements);  {O- xGTE Comments at 45; USTA Reply at 2.  But see MCI Comments at 2 (formula for maximum rate is a necessary condition to making negotiations, and therefore industry resolution of disputes, possible at all). & Several utility pole owners, however, suggest a number of changes  xMto the complaint process, such as adding a mandatory negotiation period and establishing a statute of  S- xlimitations and a minimum amount in controversy.-} {O- xԍSee American Electric, et al., Reply at 30; Carolina Power, et al., Comments at 1819; Duquesne Light Comments at 1820; Edison Electric/UTC Comments at 7; GTE Reply at 45; USTA Comments at 2. American Electric, et al., also contend that  xmeaningful negotiations can occur "only when the default pricing mechanism established by the  S`- x=Commission is somewhere close to the price on which the parties would agree absent such regulation.". `} yO - xԍAmerican Electric, et al., Comments at 1213. American Electric, et al., believe that any default pricing  xformula established pursuant to Section 224(e) should be based on ForwardLooking Economic Pricing Model based  xon economic capital costs. American Electric, et al., Comments at 13,39 and CS Docket No. 9798 Comments at 4, 4246, 9194.   xAttaching entities respond that the American Electric, et al., proposals would eliminate recourse to the  S-Commission, contrary to the content and spirit of the law./ } {O- xԍSee, e.g., NCTA Reply at 4; see also Association for Local Telecommunications Services CS Docket No. 9798 Comments at 2; USTA CS Docket No. 9798 Reply at 6.  S- ` x 13.` ` The Association of Local Telecommunications Services ("ALTS")0P } yO- xԍALTS is a national trade association representing over 30 telecommunications carriers that are facilities based competitive local exchange carriers ("CLECs"). ALTS CS Docket No. 9798 Comments at 1. asserted in its  S- xLcomments in response to the Pole Attachment Fee Notice that its members have experience attempting to  Sr- xobtain pole attachments from numerous utilities,Q1r} yO-ԍALTS CS Docket No. 9798 Comments at 2. Q and many negotiations were unsatisfactory in part due  SJ - xto the intransigence by or blatant refusal of utilities to negotiate.22J 8} {O"-ԍId. 2 USTA, a national trade association  S" - xrepresenting over 1,000 LECs,<3" } yO-ԍUSTA Comments at 1. < contends that while the most efficient manner to determine just and  xreasonable pole attachment rates is that of permitting pole owners and attachers to negotiate reasonable  S -agreements,P4 Z} yO!-ԍUSTA CS Docket No. 9798 Comments at 2. P the proposal by American Electric, et al., contravenes the statute.O5 } yO\#-ԍUSTA CS Docket No. 9798 Reply at 56. O  S - ` x 14.` ` Electric utility pole owners oppose the continued use of the current negotiation process  x>and complaint procedures established for cable operators, claiming the current regulatory scheme has  xresulted in governmentsponsored unilateral contract modification and subsidization of the cable industry"2 z5,`(`(88Y"  S- xyby the electric utility ratepayer.h6} {Oh-ԍSee, e.g., American Electric, et al., Comments at 1820. h American Electric, et al., contend that the Commission must recognize  x>that the bargaining relationship between electric utilities and cable companies has changed since 1978  x.when Congress provided the cable television industry with access to the distribution poles of utilities at  S- xLjust and reasonable rates.7$Z} yO- xJԍAmerican Electric, et al., CS Docket No. 9798 Comments at 8 (stating that since 1977, the cable industry has  {OJ- xgrown to a 67% coverage of homes in America, citing Third Annual Report, CS Docket No. 96133 (In the Matter  xxof Annual Assessment of Status of Competition in the Market for Delivery of Video Programming), 12 FCC Rcd  {O-4358, 4368, para. 14 (1997)); see also American Electric, et al., Reply at 5.  In asserting that attaching entities no longer represent an industry that needs  S`- xrate regulation under Section 224,h8`F} yOF -ԍAmerican Electric, et al., CS Docket No. 9798 Comments at 23. h American Electric, et al., acknowledge that in 1978 "Congress was  xconcerned with the cable companies' inferior bargaining position visavis utilities and wanted to assist  S- x/an industry in its infancy."29} {O-ԍId. 2 USTA interprets Congressional intent as expecting the Commission to  xintervene and rely on the statutory formula only in instances where negotiating parties are unable to reach  S- x{a mutually acceptable agreement.:"h } {O- x-ԍUSTA CS Docket No. 9798 Comments at 2 (quoting the 1977 Senate Report at 3 ("The basic design of S.  xJ1547, as reported, is to empower the [Commission] to exercise regulatory oversight over the arrangements between  xutilities and [cable television] systems in any case where the parties themselves are unable to reach a mutually satisfactory arrangement")). USTA further states that the Commission has established and  x\maintained a casebycase dispute resolution process since 1978, rather than adopting a uniform pole  Sp- xattachment rate prescription process in compliance with that Congressional mandate.Q;pR } yOb-ԍUSTA CS Docket No. 9798 Comments at 2. Q Cable and  xtelecommunications carriers assert that potential and existing attaching entities do still need pole  xjattachment rate regulation because they are still not able to bargain from a level position with utility pole  S - xowners.< } {Oz- xhԍSee Comcast, et al., Reply at 16; NCTA Reply at 36; New York Cable Television Assn. at 23; Teligent Reply at 56. Cable operators and telecommunications carriers urge the Commission to extend the existing  S -negotiation and complaint resolution system to telecommunications carriers.=$ <} {O- xԍSee, e.g., AT&T Comments at 2, Reply at 4; Champlain Valley Telecom, et al., Reply at 6 (objecting to attitude  xof American Electric, et al., reminding the Commission that its authority is not plenary); Comcast, et al., Reply at  {O> - x16; NCTA Reply at 36. Cf. New York Cable Television Assn. at 23 (current rule gives utility pole owner too much leverage); Teligent Reply at 56 (sole reliance on negotiations is not enough).   S - ` _x15.` ` Some attaching entities suggest that the Commission impose on itself a 90day time frame  SX- xin which to issue a decision on a pole attachment complaint.'>ZX(} {O %- xԍSee Ameritech Reply at 34 (complaint process should provide for expeditious resolution of disputes); KMC  xTelecom Comments at 56 (90 days for the Commission to resolve complaints as a means to workable solutions). ' Other cable and telecommunications  xKcarriers request that the Commission impose upon utility pole owners the requirement that pole attachment"0 J>,`(`(88Y"  xzagreements between private parties be on public record so that an attaching entity will have notice of:  S- x\(1) the expectations of the utility; and (2) the terms provided to other attaching entities.?} {O@-ԍSee ICG Communications Comments at 16, Reply at 12; KMC Telecom Comments at 56. The result  xNwould be that the most favored provisions from various agreements would then be available to all  S- xattaching entities.V@Z} {O-ԍSee ICG Communications Comments at 16. V Pole owners assert that attaching entities have no legitimate expectation that all  S`-provisions be available to all attaching entities.A`} {O- xԍSee American Electric, et al., Reply at 34; Duquesne Light Comments at 19; Edison Electric/UTC Comments at 67; Ohio Edison Comments at 18; Union Electric Comments at 17.  S-x B.` ` Discussion   S- ` x16.` ` Our rules for complaint resolution will only apply when the parties are unable to arrive  S- xat a negotiated agreement.ZBZF} {O~- xԍSee American Electric, et al., Comments at 15; AT&T Comments at 2; Bell Atlantic Reply at 2; Carolina  xPower, et al., Reply at 11; GTE Reply at 5; MCI Comments at 2; NCTA Comments at 34; New York State Investor Owned Electric Utilities Comments at 6; USTA Reply at 2. Z We affirm our belief that the existing methodology for determining a  Sp- xpresumptive maximum pole attachment rate, as modified in this Order, facilitates negotiation because the  SJ - xparties can predict an anticipated range for the pole attachment rate.C$J h } {OR- xԍSee, e.g., AT&T Reply at 4; ICG Communications Comments at 11; MCI Comments at 2; NCTA Comments  {O- xat 34; see also Ameritech Reply at 35 (favors transparent maximum rate determinations); GTE Reply at 45  x(uniform and transparent rate formula facilitates private negotiations); KMC Telecom Reply at 12 (clear formula and complaint process supports negotiation).  We further conclude that the current  xcomplaint procedures are adequate to establish just and reasonable rates, terms, and conditions for pole  S - xattachments.nD T } {O-ԍSee AT&T Comments at 2; MCI Comments at 2; NCTA Comments at 34.n No party has demonstrated that the Commission's time for resolution has been a problem  xin the past. While we will not impose a deadline for Commission action, we will continue to endeavor  xto resolve complaints expeditiously. An uncomplicated complaint process and a clear formula for rate  xdetermination are essential to promote the use of negotiations for pole attachment rates, terms, and  SZ- xconditions.HEZ} {O-ԍSee GTE Reply at 45. H We are committed to an environment where attaching entities have enforceable rights, where  xthe interests of pole owners are recognized, and where both parties can negotiate for pole attachment rates, allowing the availability of telecommunications services to expand.  S- ` x17.` ` We agree with attaching entities that time is critical in establishing the rate, terms, and  S- xconditions for attaching.Fx} {O$-ԍSee AT&T Reply at 4; Ameritech Reply at 3; ICG Communications Comments at 11; MCI Reply at 3. Prolonged negotiations can deter competition because they can force a new  xentrant to choose between unfavorable and inefficient terms on the one hand or delayed entry and, thus,"j F,`(`(88"  S- xa weaker position in the market on the other.hGZ} {Oh- x;ԍSee AT&T Reply at 4 (time is of the essence in negotiation); Ameritech Reply at 34 (the Commission should  x provide for expeditious resolutionso that market entry is not delayed); ICG Communications Comments at 11 (timing is important); MCI Reply at 3 (time to market is critical). h For these reasons, we reject a proposal by utilities that  xwe mandate a 180day negotiation period prior to filing a complaint with the Commission. We agree with  xcable and telecommunications carriers that such a requirement would not be conducive to a pro S- xcompetitive, deregulatory environment.~H} {O-ԍSee ICG Communications Reply at 23; KMC Telecom Reply at 4; MCI Reply at 23. ~ Such an extended period of time could delay a  S`-telecommunications carrier's ability to provide service and unnecessarily obstruct the process.I`|} {O| - xԍBut see Duquesne Light Comments at 18; Edison Electric/UTC Comments at 7; Carolina Power, et al., Comments at 1819.  S- ` x18.` ` We disagree with utilities suggesting that, in addition to the existing time frames, the pole  xowner should receive 30 days' notice by a cable operator or telecommunications carrier of any intention  S- x@to file a complaint.J} {O6- x-ԍSee American Electric, et al., Reply at 30; Edison Electric/UTC Reply at 6; GTE Comments at 45; USTA Comments at 2, Reply at 4. Such a notice requirement would be redundant under our rule and would  xjunnecessarily prolong the resolution of disputes. The current rule provides for a 45day period in which  xthe utility pole owner must respond to the request for access filed by a cable operator or  SH - xtelecommunications carrier seeking to install an attachment.CKH 0 } yO-ԍ47 C.F.R.  1.1403(b). C A complaint to the Commission must be  S - xfiled within 30 days of the denial of a request for access.BL } yO-ԍ47 C.F.R.  1.1404(k). B The utility then has an additional 30 days to  S - xrespond to the complaint.BM P } yO-ԍ47 C.F.R.  1.1407(a). B When a cable operator or a telecommunications carrier believes it has cause  S - xto complain that a pole attachment rate, term, or condition is not just or reasonable,UN } yOP-ԍ47 U.S.C.  224(b)(1), (d)(1), (e)(1).U a detailed set of data  S - x and information is required under the current rule.UO p} yO-ԍ47 C.F.R.  1.1404(g)(112), (h), (i).U A utility has 30 days in which to respond to an  xattaching entity's request for the data and information regarding the rate, term, or condition required for  SX- xthe complaint.APX} yO!-ԍ47 C.F.R.  1.1404(h).A Under the present rules, the utility has had communication with the attaching entity prior  xto the filing of the complaint, to such a degree as is necessary to understand the issues in conflict outlined  x]in the complaint. The utility has sufficient notice of the issues involved, making additional notice requirements unnecessary.  S- ` Ax19.` ` GTE suggests that we impose a one year statute of limitations on the filing of a complaint" P,`(`(88"  S- x[and suggests an amount in controversy threshold of $5,000.FQ} {Oh-ԍSee GTE Comments at 45.F We view these proposals as unnecessarily  xrestrictive as they could foreclose remedy of an unjust or unreasonable rate, term, or condition of pole  S- x[attachments, especially for small enterprises.HRZ} {O-ԍSee generally, SCBA Reply.H There is no provision in the statute for such restrictions.  x!Establishing a threshold of any dollar amount could preclude relief to small entities and would be  S`-inconsistent with Section 257 and the pro-competitive goals of the 1996 Act.WSX`} yO- xԍ47 U.S.C.  257. This section requires the Commission to eliminate market entry barriers for entrepreneurs  x,and other small businesses in the provision or ownership of telecommunication services or in the provision of parts or services to telecommunications providers.W  S- ` x20.` ` Utility pole owners must provide access to attaching entities on a nondiscriminatory  S- xbasis.AT } yO-ԍ47 U.S.C.  224(f)(1).A While we do not agree that all pole attachment agreements have to be identical, differing  xZprovisions must not violate the statutory requirement that terms be just, reasonable, and nondiscriminatory. We believe that these statutory standards are enforceable under the current rule.  SH - ` ~x21.` ` We believe it is implicit in our current ruleAUH } yO-ԍ47 C.F.R.  1.1404. A that all parties must negotiate in good faith  S - xfor nondiscriminatory access at just and reasonable pole attachment rates.V~ , } yO- xԍIn furtherance of our original mandate to institute an expeditious procedure for determining pole attachment  xhrates with a minimum of administrative costs and consistent with fair and efficient regulation, we adopted a program  {O|- xfor nondiscriminatory access to poles, ducts, conduits and rightsofway in the Local Competition Order. 11 FCC  {OF- x[Rcd at 16059, para. 1122 (citing the 1977 Senate Report at 19). In the Notice, the Commission affirmed its  xinterpretation of Congressional intent that negotiations between a utility and an attacher should continue to be the  {O- xprimary means by which pole attachment issues are resolved. See Notice, 12 FCC Rcd at 11731, para. 12; see also 47 U.S.C.  224(f)(1). In the Local Competition  S - xOrder, the Commission addressed the requirement of Section 251 that requires an ILEC to provide  xinterconnection and other rights to new entrants, and observed that new entrants have little to offer the  S - xincumbent.IW r} yO-ԍ11 FCC Rcd at 15570, para. 141. I Rather, these new competitors seek to reduce the incumbents subscribership and weaken  xthe incumbents dominant position in the market. An ILEC is likely to have scant, if any, economic  S\- xincentive to reach agreement.XB\} {O!- xԍId. The Commission continued, determining that a request by an incumbent that a new entrant contractually  xwaive its legal rights or remedies could constitute a violation of the duty to negotiate in good faith imposed by  xJSections 251(c)(1) and 252, stating: "We reject the general contention that a request by a party that another party  xLlimit its legal remedies as part of a negotiated agreement will in all cases constitute a violation of the duty to  xnegotiate in good faith. A party may voluntarily agree to limit its legal rights or remedies in order to obtain a  xvaluable concession from another party. . . . [W]e find that it is a per se failure to negotiate in good faith for a party  xhto refuse to include in an agreement a provision that permits the agreement to be amended in the future to take into  xaccount changes in Commission or state rules. Refusing to permit a party to include such a provision would be"x'W,`(`('"  {O-tantamount to forcing a party to waive its legal rights in the future." Id. at 15576, para. 152.  In the Local Competition Order, the Commission determined that a utility"\ ZX,`(`(88Z"  xstood in a position visavis the competitive telecommunications provider seeking pole attachment  xagreements that was virtually indistinguishable from that of the ILEC with respect to a new entrant  S- xseeking interconnection agreements under Sections 251 and 252 of the 1996 Act.JYZ} {O-ԍSee id. at 15570, para. 141.J We find that a utility's  xdemand for a clause waiving the licensee's right to federal, state, or local regulatory relief would be per  xse unreasonable and an act of bad faith in negotiation. In particular, a request that a pole attachment  x>agreement include a clause waiving statutory rights to file a complaint with the Commission is per se  S-unreasonable.Z} {O - xԍSee Letter from Meredith J. Jones, Chief, Cable Services Bureau to Danny E. Adams, Esq., Kelley Drye & Warren LLP, DA No. 97131 (January 17, 1997).  S-  S-IV.xCHARGES FOR ATTACHING  SH -xA.` ` Poles  S -x` ` 1. Formula Presumptions x  S - ` x22.` ` In determining a just and reasonable rate, two elements of the pole are examined: usable  xspace and other than usable space. The costs relating to these elements are allocated to those using the  SX- x.pole. In the Second Report and Order, consistent with Section 224(d)(2), the Commission defined total  S2- x{usable space as the space on the utility pole above the minimum grade level[2F} yO- xxԍIn this context, minimum grade level generally refers to the ground level or elevation above which distances are measured for determining required clearances. that is usable for the  S - xattachment of wires, cables, and related equipment.\\ } {OH-ԍSee 72 FCC 2d at 69; 47 C.F.R.  1.1402(c).\ This determination was based upon survey results,  xLconsideration of the National Electric Safety Code ("NESC"), and practical engineering standards used in  xconstructing utility poles. The Commission found that "the most commonly used poles are 35 and 40 feet  S- x]high, with usable spaces of 11 to 16 feet, respectively."8]0 } yOb-ԍ72 FCC 2d at 69.8 The Commission recognized the NESC  Sj- xguideline that 18 feet of the pole space must be reserved for ground clearance>^j } {O -ԍId. at 68, n.21.> and that six feet of pole  SB- xkspace is for setting the depth of the pole.1_BR } {O4#-ԍId.1 To avoid a pole by pole rate calculation, the Commission  xadopted rebuttable presumptions of an average pole height of 37.5 feet, an average amount of usable space  xLof 13.5 feet, and an average amount of 24 feet of unusable space on a pole. The Commission established  S- xza rebuttable presumption of one foot as the amount of space a cable television attachment occupies.;`} {ON'-ԍId. at 6970.; "v`,`(`(88$"  xyThese presumptions serve as the premise for calculating pole attachment rates under the current formula.  S- ` x23.` ` A group of electric utilities filed a white paper ("White Paper") in anticipation of the  S- xNotice and the Pole Attachment Fee Noticea"} {O- xZԍSee White Paper filed by the law firm of McDermott, Will and Emery on August 28, 1996, on behalf of the  xAmerican Electric Power Service Corporation, Commonwealth Edison Company, Duke Power Company, Entergy  xServices, Inc., Florida Power and Light Company, Northern States Power Company, The Southern Company and Washington Water Power Company. in which they suggest that an increase in the current  Sd- xpresumptive pole height is appropriate. The White Paper asserts that over time, and with increased  S>- xdemand, the average pole height has increased to 40 feet. At the same time, the White Paper contends  S- xthat the usable space presumption should be reduced from 13.5 feet to 11 feet.8b} {Oj -ԍId. at 11.8 The Commission sought  S- xcomment on these presumptions in the Pole Attachment Fee Notice and sought further comment in the  S- x/Notice to establish a full record for attachments made by telecommunications carriers under the 1996  S-Act.TcD} {O-ԍNotice, 12 FCC Rcd at 11733, para. 17.T  ST - ` x24.` ` We will address changing the existing presumptions in the Pole Attachment Fee Notice  S. - xrulemaking.Wd. } {O- x.ԍSee Pole Attachment Fee Notice, 12 FCC Rcd at 745859, paras. 1820. We reserve decision on issues  xregarding the 37.5 ft. presumptive pole height, the 13.5 ft. presumptive amount of usable space, the minimum ground  x,clearance amount, the allocation of the 40inch safety space, and the exclusion of 30 ft. poles from the calculation  xxof costs of a bare pole and the determination as to whether such poles lack a sufficient amount of usable space to accommodate multiple attachments.W Until resolution of that proceeding, we will apply our presumptions as they presently exist  xand proceed with the implementation under the 1996 Act of a methodology used in the provision of telecommunications services by telecommunications carriers and cable operators.  S - ` cx25.` ` The Notice also sought comment on an issue raised by Duquesne Light in its  Sh- xreconsideration petition of the Commission's decision in the Local Competition Order proceeding. eh } {O- xKԍNotice, 12 FCC Rcd at 11733, para. 18 (citing Local Competition Order, 11 FCC Rcd at 16058107, paras.  {OZ-11191240); see also Duquesne Light CC Docket No. 9698 Comments at 1718.   xDuquesne Light advocates that the number of physical attachments of an attaching entity is not necessarily  xreflective of the burden on the pole, and therefore of the costs relating to the attachment. Duquesne Light  xstates that varying attachments place different burdens on the pole and proposes that any presumption  S- xinclude factors addressing weight and wind loads.]f} yON"-ԍDuquesne Light CC Docket No. 9698 Comments at 1718.] We will address whether any presumptions should  S-reflect these factors in the Pole Attachment Fee Notice rulemaking.  ST-x` ` 2. Restrictions on Services Provided over Pole Attachments  S- ` x26.` ` In the Notice, we sought comment on whether the Commission's decision in Heritage"tf,`(`(884"  S- xCablevision Associates of Dallas, L.P. v. Texas Utilities Electric Company ("Heritage")g} {Oh- xԍ6 FCC Rcd 7099 (1991), recon. dismissed, 7 FCC Rcd 4192 (1992), aff'd sub nom. Texas Utilities Electric  {O2-Co. v. FCC, 977 F.2d 925 (D.C. Cir. 1993). should be  S- x\extended.Th$} {O-ԍNotice, 12 FCC Rcd at 11731, para. 13.T In Heritage, a cable operator provided traditional cable services as well as nontraditional  xservices through its facilities. Those facilities consisted of coaxial cable lashed to aerial support strands  S- xjand fiber optic cable overlashed to the aerial support strands.Ji} {O-ԍHeritage, 6 FCC Rcd at 7100.J The nontraditional services provided by  xthe cable operator consisted of non-video broadband communications services, including data transmission  S<- x\services.2j<H} {O$ -ԍId. 2 The pole owner attempted to charge the cable operator an additional, unregulated rate for  S-those poles with pole attachments supporting the facilities transmitting both video signals and data.1k} {O-ԍId.1  S- ` x27.` ` In Heritage, which was decided prior to the 1996 Act, the Commission determined that  xthe provision by a cable operator of both traditional cable services and nontraditional services on a  xcommingled basis over a single network within the cable operator's franchise area justified only a single,  SN - xyregulated pole attachment charge by the utility pole owner.<lN l } {OZ-ԍId. at 7107. < The Commission affirmed its longstanding  xlview of cable as a provider of video and nonvideo broadband services and determined that its pole  xattachment authority includes nonvideo broadband services under Section 224. The Commission stated  x|that its jurisdiction under Section 224 was not limited by definitions emanating from the Cable  S - xCommunications Policy Act of 1984 ("Cable Act of 1984")m } yOL-ԍCable Communications Policy Act of 1984, Pub. L. No. 98549, 98 Stat. 2779 (Oct. 30, 1984). because such definitions apply only for  S - xkpurposes of Title VI.Mn } {O-ԍHeritage, 6 FCC Rcd at 710304.M Further, it stated that, even when Section 224 is read in conjunction with the  xCable Act of 1984, the Cable Act of 1984 and its legislative history indicate that a cable system providing  S6-both video and nonvideo broadband services is not excluded from the benefits of Section 224. o$6 } {O- xԍId. at 7104. The U.S. Court of Appeals for the District of Columbia Circuit upheld the Commission's decision  xon appeal because it was "consistent with the congressional purpose to avoid abusive pole attachment practices by  x-utilities for the FCC to regulate any attachment by a cable operator within its franchise area and within its cable  {OP!-television system." Texas Utilities v. FCC, 977 F.2d at 936.   S- ` x28.` ` Whether Heritage continues to apply raises significant issues as cable operators expand  xinto new service areas, such as Internet services. Generally, commenters disagree as to the applicability  S- x\of Heritage since the passage of the 1996 Act amendments to Section 224. Some utility pole owners  Sr- xcontend that Heritage has been overruled by the 1996 Act, but they do not agree as to the effect of the  xoverruling. Some of the utility pole owners argue that the new Sections 224(d)(3) and 224(e) create a new"L o,`(`(88"  S- xregime requiring new rules,jp} yOh-ԍTexas Utilities Reply at 2; GTE Comments at 8; USTA Comments at 4.j and therefore Heritage is no longer applicable. Some of these commenters  x.also argue that, after the year 2001, a cable company is entitled to the old incremental rate under Section  x=224(d)(3) if the pole attachment is used solely to provide cable services. They contend that the use of a  xcable attachment to provide nonvideo services in addition to video would not be an attachment used solely  xfor cable service and such attachment would be subject to the Section 224(e) telecommunications services  S:- x2rate.Jq:X} yO2-ԍEdison Electric/UTC Comments at 9.J Other utility pole owners argue that the provision of services other than cable and  x>telecommunications services are outside the scope of Section 224 and are therefore not subject to the  S- x1Commission's jurisdiction.r\} {Or - xԍAmerican Electric, et al., Comments at 11 (citing Report and Order, CC Docket No. 9645 (In the Matter of  {O< - xFederalState Joint Board on Universal Service), 12 FCC Rcd 8776 ("Universal Service Order"), 9176, para. 781); Duquesne Light Comments at 21; Ohio Edison Comments at 20; Union Electric Comments at 19.  They contend that such services will be subject to market place  S-negotiations.s } yOn-ԍDuquesne Light Comments at 21; Ohio Edison Comments at 20; Union Electric Comments at 19.  Sr- ` x29.` ` Cable operators generally contend that Heritage has not been overruled by the 1996 Act.  xLThey also contend that high speed Internet access is a cable service and an operator offering such service  S$ - xshould not be assessed the Section 224(e) telecommunications services rate.t$ } yO`- x;ԍComcast, et al., Comments at 18; NCTA Comments at 67, n.9; New York Cable Television Assn. Comments at 8. Telecommunications  S - x]carriers generally agree that Heritage has not been overruled, and therefore the pre1996 Act rules  xcontinue to provide that a utility should not charge different pole attachment rates based on the type of  xservice provided by the cable operator, and further that a utility should be prohibited from placing  S - xunreasonable restrictions on the use of pole attachments by permitted attachers.u } yO- xԍRCN Comments at 56; Sprint Comments at 2, Reply at 12 (citing MCI Comments at 45); US West Comments at 45. Some of the  S^- x\telecommunications carriers, however, oppose any extension of Heritage, arguing that such extension  S8- xwould provide preferential treatment for cable operators.:v8L } yO$-ԍMCI Comments at 6.: At least one telecommunications carrier argues  S- xthat the distinctions established by Congress effectively overrule Heritage and that cable operators  x=providing additional services besides video service are to be treated as telecommunications carriers under  S-Section 224.Jw} {O>"-ԍSee Ameritech Comments at 4.J  Sr- ` x30.` ` We disagree with the utility pole owners who assert that the Heritage decision has been  x"overruled" by the passage of the 1996 Act insofar as it held that a cable system is entitled to a  xCommissionregulated rate for pole attachments that the cable system uses to provide commingled data  xand video. The definition of "pole attachment" does not turn on what type of service the attachment is  x.used to provide. Rather, a "pole attachment" is defined to include any attachment by a "cable television"nw,`(`(883"  S- xsystem."Cx} yOh-ԍ47 U.S.C.  224(a)(4). C Thus, the rates, terms and conditions for all pole attachments by a cable television system  S- xare subject to the Pole Attachment Act.AyX} yO-ԍ47 U.S.C.  224(b)(1).A Under Section 224(b)(1), the Commission has a duty to ensure  S- xthat such rates, terms, and conditions are just and reasonable.Yz} {O8-ԍTexas Utilities v. FCC, 977 F.2d at 93435.Y We see nothing on the face of Section  x224 to support the contention that pole owners may charge any fee they wish for Internet and traditional cable services commingled on one transmission facility.  S- ` x31.` ` The history of Section 224 further supports our conclusion. The purpose of the  xamendments to Section 224 made by the 1996 Act was similar to the purpose behind Section 224 when  S- xit was first enacted in 1978, i.e., to remedy the inequitable position between pole owners and those seeking  S- xpole attachments.K{z} {O-ԍ1977 Senate Report at 19, 20.K The nature of this relationship is not altered when the cable operator seeks to provide  xadditional service. Thus, it would make little sense to conclude that a cable operator should lose its rights  xunder Section 224 by commingling Internet and traditional cable services. Indeed, to accept contentions  xthat cable operators expanding their services to include Internet access no longer are entitled to the benefits  xof Section 224 would penalize cable entities that choose to expand their services in a way that will  xcontribute "to promot[ing] competition in every sector of the communications industry," as Congress  S -intended in the 1996 Act.| } {OV- xiԍPreamble to the 1996 Act; see also 142 Cong. Rec. S68701, S687 (daily ed. February 1, 1996) (Statement of Sen. Hollings).  SZ- ` px32.` ` Having decided that cable operators are entitled to the benefits of Section 224 when  xproviding commingled Internet and traditional cable services, we next turn to the appropriate rate to be  xapplied. We conclude, pursuant to Section 224 (b)(1), that the just and reasonable rate for commingled  xcable and Internet service is the Section 224(d)(3) rate. In specifying this rate, we intend to encourage  S- xkcable operators to make Internet services available to their customers.}&f } yO- xYԍWe have, through social contracts, encouraged cable operators to provide Internet services to their customers.  {O- xSee Social Contract for Continental Cablevision, 10 FCC Rcd 299 (1995), amended by 11 FCC Rcd 11118 (1996);  {OR- xSocial Contract for Time Warner, 11 FCC Rcd 2788 (1995), amended by FCC Rcd 3099 (1995), further amended  {O-by 12 FCC Rcd 14881(1996). We believe that specifying a  xhigher rate might deter an operator from providing nontraditional services. Such a result would not serve  xthe public interest. Rather, we believe that specifying the Section 224(d)(3) rate will encourage greater competition in the provision of Internet service and greater benefits to consumers.  S- ` ax 33.` ` We emphasize that our decision to apply the Section 224(d)(3) rate is based on our  x?regulatory authority under Section 224(b)(1). Several commenters suggested that cable operators  S- xproviding Internet service should be required to pay the Section 224(e) telecommunications rate.~T } {O&- x-ԍSee, e.g., Ameritech Comments at 4; Edison Electric/UTC Comments at 910; GTE Comments at 6; MCI Comments at 6. We"~,`(`(88"  S- xdisagree. The Universal Service Order concluded that Internet service is not the provision of a  S- xtelecommunications service under the 1996 Act. } {OB- x<ԍSee FederalState Joint Board on Universal Service, Report and Order, CC Docket No. 9645, 12 FCC Rcd  yO - x8776, at 918081, para.789 (rel. May 8, 1997), as corrected by FederalState Joint Board on Universal Service,  {O- x-Errata, CC Docket No. 9645, FCC 97157 (rel. June 4, 1997), appeal pending in Texas Office of Public Utility  {O- xCounsel v. FCC and USA, No. 9760421 (5th Cir. 1997); FederalState Joint Board on Universal Service, Order on  {Oh- x;Reconsideration, CC Docket No. 9645, 12 FCC Rcd 10095 (rel. July 10, 1997); Changes to the Board of Directors  {O2- xof the National Exchange Carrier Association Inc., FederalState Joint Board on Universal Service, Report and Order  {O- xand Second Order on Reconsideration, CC Docket Nos. 9721, 9645, FCC 97253 (rel. July 18, 1997), as corrected  {O- xby FederalState Joint Board on Universal Service, Errata, CC Docket No. 9645, DA 972477 (rel. Dec. 3, 1997);  xChanges to the Board of Directors of the National Exchange Carrier Association Inc., FederalState Joint Board on  {OX - xUniversal Service, Order on Reconsideration, Second Report and Order and Further Notice of Proposed Rulemaking,  yO" - xCC Docket Nos. 9721, 9645, FCC 97292, 12 FCC Rcd 12437 (rel. Aug. 15, 1997); FederalState Joint Board on  {O - xUniversal Service, Third Report and Order, CC Docket No. 9645, (rel. Oct. 14, 1997), as corrected by FederalState  {O - x;Joint Board on Universal Service, Erratum, CC Docket Nos. 9645 and 97160 (rel. Oct. 15, 1997); Changes to the  xBoard of Directors of the National Exchange Carrier Association, Inc., FederalState Joint Board on Universal  {OF- xService, Second Order on Reconsideration in CC Docket 9721, CC Docket Nos. 9721, 9645, FCC 97400 (rel.  {O- xNov. 26, 1997); FederalState Joint Board on Universal Service, Third Order on Reconsideration, CC Docket No.  xi9645, FCC 97411 (rel. Dec. 16, 1997); FederalState Joint Board on Universal Service, Access Charge Reform,  x[Price Cap Performance Review for Local Exchange Carriers, Transport Rate Structure and Pricing, End User  {Oj- xCommon Line Charge, Fourth Order on Reconsideration, CC Docket Nos. 9645, 96262, 941, 91213, 9572, FCC  {O4- x97420 (rel. Dec. 30, 1997), as corrected by FederalState Joint Board on Universal Service, Errata, CC Docket Nos. 9645, 96262, 941, 91213, 9572, DA 98158 (rel. Jan 29, 1998). Under this precedent, a cable television system  xproviding Internet service over a commingled facility is not a telecommunications carrier subject to the  x=revised rate mandated by Section 224(e) by virtue of providing Internet service. We note, however, that  x.Congress has directed the Commission to undertake a review of the implementation of the provisions of  xthe 1996 Act relating to universal service, and to submit a report to Congress no later than April 10,  S- x1998.Y} yO-ԍPub. L. 105119, 111 Stat. 2440 (1997), sec. 623.Y That report is to provide a detailed description of, among other things, the extent that the  xCommission's definition of "telecommunications" and "telecommunications service," and its application  S- x=of those definitions to mixed or hybrid services, are consistent with the language of the 1996 Act.1} {O-ԍId.1 We  xzdo not intend, in this proceeding, to foreclose any aspect of the Commission's ongoing examination of those issues.  S" - ` }x!34.` ` We need not decide at this time, however, the precise category into which Internet services  xfit. Such a decision is not necessary in order to determine the pole attachment rate applicable to cable  x television systems using pole attachments to provide traditional cable services and Internet services.  xRegardless of whether such commingled services constitute "solely cable services" under Section  x224(d)(3), we believe that the subsection (d) rate should apply. If the provision of such services over a  xcable television system is a "cable service" under Section 224(d)(3), then the rate encompassed by that  S2- xsection would clearly apply.AX26} yO&- xԍThe legislative history of the 1996 Act may be read to support such a conclusion. See Conf. Rpt. at 206 which  xindicates that, "to the extent that a company seeks pole attachment for a wire used solely to provide cable television  xservices (as defined by Section 602(6) of the Communications Act), that cable company will continue to pay the rate"',`(`('"  xhauthorized under current law (as set forth in subparagraph (d)(1) of the 1978 Act)." Further, the Conference Report  x: states that "[t]he conferees intend the amendment to reflect the evolution of cable to interactive services such as game  x;channels and information services made available to subscribers by the cable operator, as well as enhanced services,"  xbut was not intended to "cause dial-up access to information services over telephone lines to be classified as a cable  {O-service." Conf. Rpt. at 169. A Even if the provision of Internet service over a cable television system"2z,`(`(88"  xis deemed to be neither "cable service" nor "telecommunications service" under the existing definitions,  xthe Commission is still obligated under Section 224(b)(1) to ensure that the "rates, terms and conditions  x[for pole attachments] are just and reasonable," and, as Section 224(a)(4) states, a pole attachment includes  x."any attachments by a cable television system." And we would, in our discretion, apply the subsection  xl(d) rate as a "just and reasonable rate" for the procompetitive reasons discussed above. We again  S8- xemphasize the pervasive purpose of the 1996 Act and the premise of the Commission's Heritage decision,  S- xto encourage expanded services, and that a higher or unregulated rate deters this purpose.dz} {O, -ԍSee also Texas Utilities v. FCC, 977 F.2d at 931933. d We note that  x\in the one case where Congress affirmatively wanted a higher rate for a particular service offered by a  xcable system, it provided for one in section 224(e). In requiring that the Section 224(d) rate apply to any  x\pole attachment used 'solely to provide cable service,' we do not believe Congress intended to bar the  xCommission from determining that the Section 224(d) rate methodology also would be just and reasonable in situations where the Commission is not statutorily required to apply the higher Section 224(e) rate.  S - ` ~x"35.` ` We also disagree with utility pole owners that submit that all cable operators should be  xz"presumed to be telecommunications carriers" and therefore charged at the higher rate unless the cable  S - xjoperator certifies to the Commission that it is not "offering"?X } yOV- xԍTelecommunications services means the offering of telecommunications for a fee directly to the public, or to  xsuch classes of users as to be effectively available directly to the public, regardless of the facilities used. 47 U.S.C.  153(43). ? telecommunications services. , } {Ov- xxԍSee American Electric, et al., Comments at 4647; Bell Atlantic Comments at 3; Colorado Springs Utilities Comments at 3; ICG Communications Comments at 27; MCI Comments at 69. We think  xthat a certification process would add a burden that manifests no benefit. We believe the need for the pole  xowner to be notified is met by requiring the cable operator to provide notice to the pole owner when it  S2- xbegins providing telecommunication services. The rule we adopt in this Order will reflect this required  x]notification. We also reject the suggestions of utility pole owners that the Commission should be  S- xresponsible for monitoring and enforcing a certification of cable operators regarding their status. } {O - xxԍSee American Electric, et al., Comments at 4647; Bell Atlantic Comments at 3; Colorado Springs Utilities Comments at 3; ICG Communications Comments at 27; MCI Comments at 69. The  x.record does not demonstrate that cable operators will not meet their responsibilities. If a dispute arises, the Commission's complaint processes can be invoked.  SD-x` ` 3. Wireless Attachments  S-x` `  a.Background  S- ` x#36.` ` In the Notice, the Commission stated that, although wireless carriers have not historically  xaffixed their equipment to utility poles, the 1996 Act gives them the right to do so and entitles them to"~,`(`(88"  S- xLrates consistent with Commission rules.T} {Oh-ԍNotice, 12 FCC Rcd at 11741, para. 61.T The Local Competition Order held that Section 224 does not  x<describe the specific type of telecommunications equipment that an entity may attach, and that establishing  S-an exhaustive list of equipment is not advisable or even possible.JZ} yO-ԍ11 FCC Rcd at 16085, para. 1186. J  Sb- ` Px$37.` ` Some utility pole owners argue for limiting the type of equipment that a party may attach  xMto facilities and assert that wireless carriers should not have the benefit of Section 224. They rely on  S- xlegislative history accompanying the 1978 Pole Attachment ActA} {O -ԍ1977 Senate Report.A and the failure of Section 224 to include  S- xthe word "wireless" in its language.|} {O - x/ԍSee, e.g., American Electric, et al., Comments at 11; Edison Electric/UTC Reply at 8; Petition for  xkReconsideration by Consolidated Edison Company of NY in CC Docket No. 9698 at 1112; Petition for  xReconsideration by Duquesne Light Co. in CC Docket No. 9698 at 1718; Petition for Reconsideration by American  xiElectric Power, et al., in CC Docket No. 9698 at 118, 2629; Petition for Reconsideration by Florida Power &  {O(- xLight in CC Docket No. 9698 at 2426; see also Carolina Power, et al., CS Docket 9798 Reply at 3437; Edison Electric/UTC CS Docket No. 9798 Comments at 37. According to the pole owners, Congress intended to cover pole  xattachments only for wire communications, and would have explicitly expanded that scope in the 1996  S- xLAct if it wanted to do so.2 } {O2-ԍId. 2 These interests cite the 1977 Senate Report stating, "Federal involvement in  xjpole attachment matters will occur only where space on a utility pole has been designated and is actually  SL - xbeing used for communications services by wire or cable."L } {Ov- xԍ1977 Senate Report at 15; see, e.g., Petition for Reconsideration by American Electric Power, et. al., in CC Docket No. 9698 at 1011. In contrast, wireless providers assert that  S$ - xthey are telecommunications carriers entitled to the protection of Section 224.$ } {O-ԍSee, e.g., Bell Atlantic Reply at 69; Omnipoint Reply at 23; Teligent Comments at 2. These parties cite Section  xj3(44), which defines "telecommunications carrier" as "any provider of telecommunications services," and  xSection 3(46), which defines "telecommunications service" as "the offering of telecommunications for a  S - xfee...regardless of the facilities used." v} {O-ԍ47 U.S.C.  3(44), (46); see, e.g., Bell Atlantic Reply at 69; Omnipoint Reply at 3. Wireless providers contend they do not have easy alternatives  S - xfor placing their equipment because they have had difficulty getting permits to erect antennas.T } {O,!-ԍSee, e.g., Bell Atlantic Reply at 69.T They  xargue that telecommunications competition arises in many forms and the Commission's regulations should  S4- xnot deter any particular method of delivering services.P4} {On$-ԍSee, e.g., Teligent Comments at 2.P In short, they ask the Commission to decide that  S -Section 224 "unambiguously affords all telecommunications providers a legal right of access to poles."= ,} yO&-ԍOmnipoint Reply at 3.=" ,`(`(88I"Ԍ S- ` Qԙx%38.` ` Telecommunications carriers and the utility pole owners acknowledge that determining  S- x-an appropriate formula for wireless attachments is difficult.v} {O@-ԍSee, e.g., Bell Atlantic Reply at 69; Edison Electric/UTC Reply at 2. v Some utility pole owners assert it is beyond  S- x/the scope of this rulemaking.Z} {O- xԍSee, e.g., American Electric, et al., Comments at 56; Carolina Power, et al., Reply at 1718; Edison Electric/UTC Reply at 23. Some telecommunications carriers and utility pole owners agree that  S- x<previous and proposed rate formulas do not lend themselves to the requirements of wireless attachments.} {O- xԍSee, e.g., Bell Atlantic Reply Comments at 69; Comments at Edison Electric/UTC Comments at 3; GTE Reply at 18.  x-On the other hand, wireless interests emphasize that pole attachment fees are assessed for the use of space,  S8- x-and should not depend primarily on what type of equipment occupies that space.V8} {O -ԍSee, e.g., Teligent Comments at 910. V These parties contend  xthat rates for wire and wireless attachments should be the same so that discriminatory pricing does not  S-occur.} {O(-ԍSee, e.g., AT&T Reply at 21; Omnipoint Reply at 3; Teligent Comments at 9; Winstar Comments at 2.  S-x` `  b.Discussion  SH - ` 4x&39.` ` Wireless carriers are entitled to the benefits and protection of Section 224. Section  x=224(e)(1) plainly states: "The Commission shall...prescribe regulations to govern the charges for pole  S - xattachments used by telecommunications carriers to provide telecommunications services."A 2 } yO-ԍ47 U.S.C.  224(e)(1).A This language encompasses wireless attachments.  S - ` x'40.` ` Statutory definitions and amendments by the 1996 Act demonstrate Congress' intent to  xexpand the pole attachment provisions beyond their 1978 origins. Section 224(a)(4) previously defined  xa pole attachment as "any attachment by a cable television system," but now states that a pole attachment  S- xis "any attachment by a cable television system or provider of telecommunications service."Q } yOj-ԍ47 U.S.C. 224(a)(4) (emphasis added).Q Moreover,  x?in Section 224(d)(3), Congress applied the current pole attachment rules as interim rules for "any  S- xtelecommunications carrier...to provide any telecommunications service."@R } yO -ԍ47 U.S.C. 224(d)(3).@ In both sections, the use  xof the word "any" precludes a position that Congress intended to distinguish between wire and wireless  x=attachments. Section 224(e)(1) contains three terms whose definitions support this conclusion. Section  SB- x3(44) defines telecommunications carrier as "any provider of telecommunications services.">B} yO$-ԍ47 U.S.C. 153(44).> Section  x.3(46) states that telecommunications services is the "offering of telecommunications for a fee directly to  xythe public...regardless of the facilities used," and Section 3(43) specifies telecommunications to be "the  xtransmission, between or among points specified by the user, or information of the user's choosing,"r,`(`(88B"  S- xwithout change in the form or content of the information as sent and received."J} yOh-ԍ47 U.S.C.  153(46),(43). J The use of "any" in  xNSection 3(44) precludes limiting telecommunications carriers only to wireline providers. Wireless  x!companies meet the definitions in Sections 3(43) and 3(46). In fact, the Commission has already  S-recognized that cellular telephone, mobile radio, and PCS are telecommunications services.X} {O-ԍSee, e.g., Universal Service Order, 12 FCC Rcd at 9175; Local Competition Order, 11 FCC Rcd at 15997.  S8- ` 4 x(41.` ` There are potential difficulties in applying the Commission's rules to wireless pole  xyattachments, as opponents of attachment rights have argued. They note that previous and proposed rate  S- xformulas do not account for the unusual requirements of wireless attachments.} {Or - xԍSee, e.g., Edison Electric/UTC Comments at 4; see also Petition for Reconsideration filed by Duquesne Light in CC Docket No. 9698 at 1718. These parties assert that  xsuch attachments are usually more than a traditional boxlike device and cable wires strung between poles.  xzThey include an antenna or antenna clusters, a communications cabinet at the base of the pole, coaxial  xNcables connecting antennas to the cabinet, concrete pads to support the cabinet, ground wires and  xtrenching, and wires for telephone and electric service. One commenter noted that there are "far greater  S -costs and operational considerations" for wireless attachments.J D} yO-ԍEdison Electric/UTC Comments at 5.J  S - ` x)42.` ` There is no clear indication that our rules cannot accommodate wireless attachers' use of  xpoles when negotiations fail. When an attachment requires more than the presumptive onefoot of usable  xspace on the pole, or otherwise imposes unusual costs on a pole owner, the onefoot presumption can be  xrebutted. In addition, when wireless devices do not need to use every pole in a utility's inventory, the  x]parties can agree on some reasonable percentage of poles for developing a presumptive number of  xattaching entities. If parties cannot modify or adjust the formula to deal with unique attachments, and the  xparties are unable to reach agreement through good faith negotiations, the Commission will examine the issues on a casebycase basis.  Sh-x` ` 4. Allocating the Cost of Other than Usable Space  S-x` `  a.Method of Allocation  S- ` ~x*43.` ` To determine the rate that a telecommunications carrier must pay for pole attachments, Section 224(e)(2) provides that:  XxA utility shall apportion the cost of providing space on a pole, duct, conduit, or rightof way other than the usable space among entities so that such apportionment equals two thirds of the costs of providing space other than the usable space that would be allocated  S-to such entity under an equal apportionment of such costs among all attaching entities.A} yOL%-ԍ47 U.S.C.  224(e)(2).A   xThis statutory language requires an equal apportionment of twothirds of the costs of providing other than"d ,`(`(88"  xkusable ("unusable") space among all attaching entities. The Commission proposed a methodology to apportion these costs which translates to the following formula:  S-Unusable` `  hh@hppNet Cost of  S`- X Spacex =` ` 2 XUnusable SpacehX ppa Bare Pole  X xxCarrying  S8-Factorx` ` 3 Pole Height@hppNumber of   xxCharge  S-x` `  hh@hppAttachers   xxRateE yOx- xYԍThe final component of the overall pole attachment formula is the carrying charge rate. Carrying charges are  xthe costs incurred by the utility in owning and maintaining poles regardless of the presence of pole attachments. The  xcarrying charges include the utility's administrative, maintenance, and depreciation expenses, a return on investment,  xJand taxes. To help calculate the carrying charge rate, we developed a formula that relate each of these components  {O -to the utility's pole investment. See Pole Attachment Fee Notice at Appendix A.  X   S- ` }x+44.` ` We adopt our proposed methodology to apportion the cost of unusable space. We believe  xthis formula most accurately determines the apportionment of cost of unusable space. As mandated by Congress, it equally apportions twothirds of the costs of unusable space among attaching entities.  S -x` `  b.Counting Attaching Entities  Q -x` `  (1) hhTelecommunications Carriers, Cable Operators(#h  Q -x` `  hhand NonIncumbent LECs  SX- ` x,45.` ` Under Section 224(e)(2), the number of attaching entities is significant because the costs  xof the unusable space assessed to each entity decreases as the number of entities increases. Therefore,  xdetermining which entities are attachers and which are not has a substantial effect on the proper  S- x?apportionment of the costs of unusable space. The Commission proposed in the Notice that any  xjtelecommunications carrier, cable operator, or LEC attaching to a pole be counted as a separate entity for the purposes of the apportionment of twothirds of the costs of the unusable space.  SB- ` Ax-46.` ` We will count as separate entities any telecommunications carrier, any cable operator, and  S- xany nonincumbent LEC.uZz} {O4- xԍSee Adelphia, et al., Comments at 6; American Electric, et al., Comments at 40; AT&T Comments at 9; AT&T  xZReply at 9; Comcast, et al., Reply at 12; KMC Telecom Comments at 6; NCTA Comments at 1718; New York Cable Television Assn. Comments at 22; Summit Comments at 23; U S West Comments at 67.u This approach is consistent with the language of the statute and comports  S- xwith Congress' intent to count all attaching entities when allocating the costs of unusable space.F} {O. -ԍSee Conf. Rpt. at 206. F The  xstatute uses the term "entities" not "telecommunications carriers" when indicating how the costs of  xunusable space should be allocated. We interpret this use to indicate the inclusion of cable operators as well as telecommunications carriers when allocating the cost of unusable space.  S*- ` ~x.47.` ` Some commenters argue that cable operators providing only cable service should not be  xcounted because it would result in requiring the incumbent LEC that owns a pole, but not the competitors". ,`(`(88M"  S- x[of the incumbent LEC, to subsidize "pure" cable attachments.} yOh- xԍAmeritech Comments at 11; Duquesne Light Comments at 39; MCI Comments at 14; Ohio Edison Comments at 37; Union Electric Comments at 34. Similarly, other commenters argue that  xNcable operators that solely provide cable service should not be included in the count because their  xattachments are not subject to rate regulation under Section 224(e)(2). We find these arguments  xjunpersuasive. The statutory language compels a different conclusion. The statute states that the cost of  S`- xunusable space shall be allocated under an equal apportionment "among all attaching entities."A` } yO -ԍ47 U.S.C.  224(e)(2).A While  x=the cable operator rate is different, Congress made no indication that it intended to exclude any attaching  xentity when apportioning the costs of unusable space. On the contrary, the legislative history of the 1996  S- xzAct states that all attaching entities should be counted.B} {O8 -ԍConf. Rpt. at 206. B Congress explicitly provided for a different  x[formula when determining pole attachment rates for cable operators providing cable services, but it made  xno such provision for the exclusion of those operators in the allocation of costs for unusable space.  xMoreover, Section 224(e)(2) does not restrict the use of the term "entities" to those entities that pay rates under Section 224(e).  Q -x` `  (2)hhPole Owners Providing Telecommunications  S -x` `  hhServices and Incumbent LECs  S - ` x/48.` ` In the Notice, the Commission tentatively concluded that, where a poleowning utility is  xproviding telecommunications services, the utility would also be counted as an attaching entity for the  S4- xNpurposes of allocating the costs of unusable space under Section 224(e).T4B} {O-ԍNotice, 12 FCC Rcd at 11734, para. 22.T The Commission also  xtentatively concluded that an ILEC with attachments on a pole should be counted for the purposes of  x/apportionment of the costs of unusable space. The Commission sought comment on how these two  S- xPdefinitions impact its tentative conclusion.E} {O0-ԍId. at 11735, para. 23.E The Commission noted that the definition of  xtelecommunications carrier under Section 224 excludes ILECs, and a pole attachment is defined as any attachment by a cable television system or a provider of telecommunications service.  S- ` x049.` ` American Electric, et al., oppose counting an ILEC with attachments on the pole because  xthe definition of a telecommunications carrier excludes ILECs and the definition of pole attachments  S- xNspecifically includes only attachments made by telecommunications carriers or cable operators.Rf } yO!-ԍAmerican Electric, et al., Comments at 41.R  xInclusion of ILECs in the apportionment of costs of unusable space, they conclude, would improperly  S|- xextend the scope of Section 224 and contradict Congressional intent.1| } {O%-ԍId.1 We disagree. The exclusion in  x{Section 224(a)(5) of ILECs from the term telecommunications carrier is directed to the purpose of  xyamended Section 224, to provide an important means of access. ILECs generally possess that access and", ,`(`(88"  S- xCongress apparently determined that they do not need the benefits of Section 224.} {Oh-ԍSee, e.g., Section 224(f)(1) (requiring utilities to afford telecommunications carriers nondiscriminatory access). The fundamental  xprecept of the 1996 Act was to enhance competition, and the amendments to Section 224, like many of  S- xthe amendments to the 1996 Act,bZ} {O-ԍSee Conf. Rpt at 113 ("Preamble to the 1996 Act"). b are directed to new entrants.h} {O<-ԍLocal Competition Order, 11 FCC Rcd at 15543, para. 83. h In contrast, Section 224(e), which  xdelineates a new means to allocate costs, does not refer to "telecommunications carriers," but to "attaching  S`- xkentities.">`~} yO~ -ԍ47 U.S.C.  224(e).> Moreover, the term pole attachment is defined in terms of attachments by a "provider of  S8- x=telecommunications service" not as an attachment by a "telecommunications carrier."A8} yO -ԍ47 U.S.C.  224(a)(4).A The Conference  xReport confirms that Congress concluded that the unusable space "is of equal benefit to all entities  xattaching to the pole" and intended that the associated costs be apportioned "equally among all such  S- x-attachments."@} {O-ԍConf. Rpt. at 206.@ We thus think the statute draws a clear distinction between those entities that may invoke  S-Section 224 and those entities that count for purposes of allocating the costs of unusable space.;0 } yOh-ԍ47 U.S.C.  224.;  SH - ` 3x150.` ` We affirm our tentative conclusion that any pole owner providing telecommunications  xservices, including an ILEC, should be counted as an attaching entity for the purposes of allocating the  S - xcosts of unusable space under Section 224(e)(2).j } {OX- x;ԍSee Adelphia, et al., Comments at 6; AT&T Comments at 9; AT&T Reply at 9; Comcast, et al., Reply at 12;  xKMC Telecom Comments at 6; MCI Comments at 12; NCTA Comments at 1718; Summit Comments at 23; US  {O- xhWest Comments at 56. But see American Electric, et al., Comments at 41 (the definition of a telecommunications  xcarrier excludes incumbent ILECs and the definition of pole attachments specifically includes only attachments made by telecommunications carriers or cable operator).j This includes pole owners that use only a part of their  x0physical plant capacity to provide these services and is consistent with our recognition that pole  xattachments are defined in terms of attachments by a "provider of telecommunication service." Section  S - x224(e)(2) states that the costs of unusable space shall be allocated on the basis of "all attaching entities."A t} yO-ԍ47 U.S.C.  224(e)(2).A  xThere is no indication from the statutory language or legislative history that any particular attaching entity should not be counted.  S- ` x251.` ` We also believe this conclusion is supported by Section 224(g) which requires that a utility  xproviding telecommunications services impute to its costs of providing service an amount equal to the rate",`(`(88"  S- xkfor which it would be liable under Section 224.} yOh-ԍ47 U.S.C.  224(g) states:   XxA utility that engages in the provision of telecommunications services or cable services shall impute to its   kcosts of providing such services (and charge any affiliate, subsidiary, or associate company engaged in the   provision of such services) an equal amount to the pole attachment rate for which such company would be liable under this section.(# This section reflects Congress' recognition that as a  xprovider of telecommunications services, a pole owner uses and benefits from the unusable space in the  xsame way as the other attaching entities. Section 224(g) also directs the utility to impute the costs relating  x/to these services to the appropriate affiliate, making clear that another entity is using the facility and  xshould be counted as an attaching entity. We will count any pole owner providing telecommunications services, including an ILEC, as an attaching entity for the purpose of allocating costs of unusable space.  Q-x` `  (3)hhGovernment Attachments  S- ` nx352.` ` The Notice proposed that government entities with attachments, like other entities present  xMon the utility pole, be counted as entities on the pole for purposes of allocating the costs of unusable  x?space. A utility may be required under its franchise or statutory authorization to provide certain  xattachments for public use, such as traffic signals, festoon lighting, and specific pedestrian lighting. Often  xthe responsible government agency does not directly pay for the attachment. The Commission proposed  xLthat, since the government agency is using space on the pole, its attachments be counted for purposes of  xallocating the cost of unusable space. This cost would be borne by the pole owner, since it relates to a responsibility under its franchise or statutory authorization.  S2- ` ~x453.` ` Some cable operators and telecommunications carriers agree with our proposal to count  S - x as a separate attaching entity government agencies that have attachments to the pole. @} {O- xԍSee, e.g., AT&T Reply at 9 & 12; Comcast, et al., Reply at 12; KMC Telecom Comments at 6; MCI Comments at 12; NCTA Comments at 19. Utility pole  x=owners and other telecommunications carriers disagree, stating that the utilities would be responsible for  xa cost that should be shared by all users of the pole because all parties benefit from the existence of the  S- xpole as allowed by the government.vZ} {O- xԍSee, e.g., Ameritech Comments at 12; Dayton Power Comments at 2; Duquesne Light Comments at 42; ICG  xKCommunications Comments at 35; New York State Investor Owned Electric Utilities Comments at 2223; Ohio Edison Comments at 36,40, Reply at 911; Union Electric Comments at 33 & 37, Reply at 911. v Since the agencies do not pay fees to the pole owner, the  xcommenters continue, the utility must unfairly absorb the government agency's share of the cost of  xunusable space, in addition to the onethird share of the cost for which the pole owner is automatically  x]liable. Still other utility pole owners disagree, asserting that government attachments are not wire  xattachments, do not provide telecommunications or cable services and are not included in the definition  S- xkof "pole attachment." } {O&$- xԍSee, e.g., American Electric, et al., Comments at 4142; Carolina Power, et al., Comments at 56; New York State Investor Owned Electric Utilities Comments at 2223. In defending its recommendation not to count government attachments, ICG  xCommunications adds that government attachments are normally installed in the pole's unusable space so",`(`(88"  S-as to avoid interference with other parties' use of the pole space.T} {Oh-ԍSee ICG Communications Comments at 35.T  S- ` x554.` ` To the extent that government agencies provide cable or telecommunications service, we  x=affirm our proposal that they be included in the count of attaching entities for purposes of allocating the  xjcost of unusable space. We will not include government agencies in the count as a separate entity if they  xonly provide certain attachments for public use, such as traffic signals, festoon lighting, and specific  xpedestrian lighting. We conclude that, where a government agency's attachment is used to provide cable  x!or telecommunications service, the government attachment can accurately be described as a "pole  S- x=attachment" within the meaning of Section 224(a)(4) of the 1996 Act.CZ} yO -ԍ47 U.S.C.  224(a)(4). C Like a private pole attachment,  x=it benefits equally from the unusable space on the pole and the costs for this benefit are properly placed  xon the government entity or the pole owner. Since the government attacher and the pole owner have a  xrelationship that benefits both parties, we are not persuaded that the pole owner is unfairly absorbing the  x/cost of the government's telecommunications attachments to the extent the pole owner's franchise so  xprovides. We will not include a government agency with an attachment that does not provide cable or  xtelecommunications service as an entity in the count when apportioning the costs of unusable space  S -because such an attachment is not a "pole attachment" within the meaning of Section 224(a)(4).3 } {O2-ԍId. 3  QX-x` `  (4)hhSpace Occupied on Pole x  S- ` x655.` ` The Notice sought information on alternative methodologies to apportion costs of unusable  x=space, such as by allocating to each entity a proportion of the unusable space equal to the proportion of  S- xusable space occupied by the entity's attachment.T|} {O-ԍNotice, 12 FCC Rcd at 11735, para. 23.T Specifically, the Commission sought comment on an  xalternate approach that counts any telecommunications carrier as a separate attaching entity for each foot,  xor partial increment of a foot, it occupies on the pole. The Commission also asked whether such a  xmethodology is consistent with the statutory requirement in Section 224(e)(2) for equal apportionment among all attaching entities.  S- ` }x756.` ` Based on the record, we reject this alternate proposal. U S West, in opposing the alternate  xmethod, argues that if Congress had intended to allocate the costs of unusable space based on space  Sz- x occupied, it would not have distinguished between usable and unusable space.Kz} {O(!-ԍSee U S West Comments at 78.K RCN supports the  xNalternative method because, it argues, not all attaching entities benefit to the same degree from the  S*- xunusable space and those using more space should be allocated more of the costs of unusable space.<*} yOj$-ԍRCN Comments at 34.<  xSimilarly, SBC argues that we should consider the amount of space occupied when allocating the costs  xof unusable space because an attaching entity that occupies two spaces on the pole should be allocated"0 ,`(`(88["  S-twice as much costs as an attaching entity that only occupies one space.>} yOh-ԍSBC Comments at 2425.>  S-x  S- ` ~x857.` ` In suggesting the alternative approach that entities using more than one foot be counted  x=as a separate entity for each foot or increment thereof, we sought to ensure that entities be allocated the  xzcosts of the unusable space through a means reflecting their relative use. The record does not indicate  x[whether use of more than one foot by an entity will be a pervasive or occasional circumstance. We agree  xwith those parties that state that allocating space in such a manner will add a level of complexity, and not  S- xnecessarily produce a fairer allocation of the cost of unusable space.  We are also convinced that the  xalternative proposal is inconsistent with the plain meaning of Section 224(e) which apportions the cost of  S-unusable space "under an equal apportionment of such costs among all attaching entities."AX} yO -ԍ47 U.S.C.  224(e)(2).A  SH - ` x958.` ` As another alternative method to apportioning cost equally, MCI argues that the  xapportionment of twothirds of the costs of unusable space should be based on the number of attachments  S - xrather than the number of attaching entities.; } yO-ԍMCI Comments at 12.; Allocating costs by the number of entities, it argues, would  xnot allocate any unusable space to overlashings and will result in an incentive for "speculative" overlashing  xby existing attachers. We also will not adopt MCI's proposal to count attachments instead of attaching  xentities. The record does not demonstrate that overlashing leads to distortion of the allocation of the costs of the pole.  S-x` `  c.Overlashing x  Q-x` `  (1)hhBackground  Sh- ` x:59.` ` Overlashing, whereby a service provider physically ties its wiring to other wiring already  xsecured to the pole, is routinely used to accommodate additional strands of fiber or coaxial cable on  S- xexisting pole attachments. x} {O0- xxԍSee Comcast, et al., Reply at 8 (cable operators have routinely overlashed for 30 years); NCTA Comments at 5 (overlashing has been a critical component of cable industry's construction strategy for decades).  The Commission sought information in the Notice on how each attaching  xand overlashing entity should be treated for purposes of allocating the costs of unusable and usable  S- x-space.T} {O< -ԍNotice, 12 FCC Rcd at 11732, para. 15.T We observed that each possible "host attachment" may be overlashed with wiring providing other  S- xtypes of services or owned by other types of providers.Zd } yO"- x,ԍFor example, the utility pole owner, an ILEC, a cable operator, and a telecommunications carrier that already  xhave attachments on the pole may expand their services through overlashing their existing lines, or a third party  {O6$-attachment may overlash any existing attachment, under certain circumstances which we will address in this Order.  The Commission also requested that  xcommenters discuss whether and to what extent overlashing facilitates the provision of services other than  SR-cable service by cable operators.TR } {Ox'-ԍNotice, 12 FCC Rcd at 11732, para. 15.T"R,`(`(88"Ԍ S- ` oԙx;60.` ` In addressing overlashing in the cable operator context, the Commission issued a public  S- xznotice in January 1995 (the "Overlashing Public Notice")} {O@-ԍCommon Carrier Bureau Cautions Owners of Utility Poles, Public Notice, DA 9535 (January 11, 1995). cautioning owners of utility poles against  xrestricting cable operators from overlashing their own pole attachments with fiber optic cable. The  xyCommission noted the serious anticompetitive effects of preventing cable operators from adding fiber to  xtheir systems by overlashing. The Commission believed improper constraints were being placed on cable  xsystems that sought to overlash fiber optic lines to their existing coaxial cable lines in order to build out  xtheir facilities. While recognizing concerns regarding engineering specifications and arranging for access  x>and notification in cases of emergencies or modification, the Commission affirmed its commitment to  xensure that the growth and development of cable system facilities are not hindered by an unreasonable  S- xdenial of overlashing by a utility pole owner.3Z} {O -ԍId. 3 Overlashing capability continues to be a facet of a pro Sr-competitive market because it maximizes the usable capacity on a pole.gr} {O -ԍLocal Competition Order, 11 FCC Rcd at 16075, para. 1161.g  Q" -x` `  (2)hhDiscussion  S -x` `  hh(a)@Overlashing One's Own Pole Attachment  S - ` x<61.` ` The 1996 Act ushered in an era of transition from regulation to competition in  xtelecommunications markets. The 1996 Act is grounded in the belief that competition will bring the  x[greatest benefits to consumers and the greatest diversity of telecommunications services to communities.  S - xThese broad aims include those expressed in Section 1 of the Communications Act, to "make available  x. . . to all the people of the United States . . . a rapid, efficient, Nationwide, and worldwide . . .  S- x/communication service,"~} {O- xYԍ47 U.S.C.  151. These goals date to the original passage of the Communications Act of 1934. See H.R. Rep. No. 1918, 73rd Cong., 2d Sess. 1 (1934). and those expressed in the 1996 Act, to establish a "procompetitive, de xregulatory national policy framework designed to accelerate private sector deployment of advanced  xOtelecommunications and information technologies and services to all Americans by opening all  SB- xtelecommunications markets to competition."HB} {O-ԍSee Preamble to 1996 Act. H To implement this framework, the 1996 Act made  xnumerous amendments to the Communications Act, including the expansion of Section 224 jurisdiction  xto pole attachments for telecommunications carriers and expanded access to utility poles for the purposes  S- xof providing cable and telecommunications services.<j } yO!-ԍ1996 Act  703. < As the Commission has made clear, determining  xwhether actions enhance competition requires examining those actions in light of the significant changes  Sz-to the laws governing the provision of telecommunications services made by the 1996 Act.5Zz } {O%- xԍMemorandum Opinion and Order (In the Applications of NYNEX Corporation and Bell Atlantic Corporation  x-for Consent to Transfer Control of NYNEX Corporation and Its Subsidiaries), FCC 97286 (released August 14, 1997) at para. 32, 38.5 "R,`(`(88"Ԍ S- ` x=62.` ` We believe overlashing is important to implementing the 1996 Act as it facilitates and  xexpedites installing infrastructure essential to providing cable and telecommunications services to American  xcommunities. Overlashing promotes competition by accommodating additional telecommunications  S- xproviders and minimizes installing and financing infrastructure facilities.}} {O-ԍSee ICG Communications Comments at 20; NCTA Comments at 7; RCN Comments at 67.} We think that overlashing is  S`- xan important element in promoting the policies of Sections 224 and 257`Z} yOZ- xJԍSection 257 provides that the Commission shall seek to promote policies that eliminate market entry barriers for small business and others. 47 U.S.C. 257. to provide diversity of services  S8- xover existing facilities, fostering the availability of telecommunications services to communities,x8} {O -ԍSee New York Cable Television Assn. Comments at 78; NCTA Comments at 67.x and  S-increasing opportunities for competition in the marketplace.GD} {O -ԍSee Preamble to 1996 Act.G  S- ` x>63.` ` Utility pole owners oppose overlashing as an expansion of their obligation to provide for  S- xpole attachments and, further, as an unsupervised burden on the poles.C|} {O- xiԍSee American Electric, et al., Comments at 46; Carolina Power, et al., Comments at 89; Colorado Springs  x;Utilities Comments at 3; Dayton Power Comments at 1; Duquesne Light Comments at 2627; Edison Electric/UTC  xwComments at 11; New York Investor Owned Electric Utilities Comments at 910; Ohio Edison Comments at 2426;  x SBC Comments at 812; Sprint Comments at 23; Texas Utilities Comments at 6; Union Electric Comments at 2324;  {O0- xYUSTA Comments at 8. Cf. Ameritech Comments at 67; AT&T Comments at 5; New York Cable Television Assn.  x,Comments at 45; Comcast, et al., Comments at 34; ICG Communications Comments at 21; MCI Comments at 8; NCTA Comments at 7.C Cable operators and  x[telecommunications carriers assert that overlashing is a routine construction practice that has gone on for  xdecades without interference from the pole owners until the utilities began entering competitive  S - xbusinesses. } {O- xLԍSee, e.g., Comcast, et al., Comments at 35; NCTA Comments at 7; New York Cable Television Assn. Comments at 45. Some telecommunications carriers urge the Commission to bar utility pole owners from  S -prohibiting overlashing. t} {O -ԍSee, e.g., ICG Communications Comments at 21; New York Cable Television Assn. Comments at 4. x  S - ` Bx?64.` ` We have been presented with no persuasive reason to change the Commission's policy  xthat encourages overlashing, and we agree with representatives of the cable and telecommunications  xkindustries that, to the extent that it does not significantly increase the burden on the pole, overlashing  S0- xone's own pole attachment should be permitted without additional charge.0} {O"- xԍSee AT&T Comments at 6; Comcast, et al., Comments at 34, 11; New York Cable Television Assn.  {O#-Comments at 45. But see ICG Communications Comments at 2021. To the extent that the  x[overlashing does create an additional burden on the pole, any concerns should be satisfied by compliance"b,`(`(88+"  S- xwith generally accepted engineering practices.} {Oh- xԍSee 47 U.S.C.  224(f)(2) (permitting a pole owner to deny access for reasons of safety, reliability and generally applicable engineering purposes). We note that we have deferred decision on the issue of  xythe effect any increased burden may have on the rate the utility pole owner may charge the host attacher.  S- x=As stated above, we believe that the Pole Attachment Fee Notice rulemaking is a more appropriate forum  S- xfor resolution of this issue."} {OL- xԍSee Section IV.A.1. above (Duquesne Light proposes that any presumptions include weight and wind load factors). As also stated above, we affirm our current presumptions for the time being.  xMWe also do not believe that overlashing is an expansion of a pole owners' obligation. Overlashing has  S:- xzbeen in practice for many years.F:|} {OV -ԍSee NCTA Comments at 5. F We believe utility pole owners' concerns are addressed by Section  x>224's assurance that pole owners receive a just and reasonable rate and that pole attachments may be denied for reasons of safety, reliability, and generally applicable engineering purposes.  S-x` `  hh(b)@Third Party Overlashing  SJ - ` Px@65.` ` Telecommunications carriers seeking expeditious means to gain access to poles have begun  S" - xcontracting with existing attaching entities to overlash to existing attachments.n" } {O-ԍLocal Competition Order, 11 FCC Rcd at 1607577, paras. 116164.n In the Notice, the  xCommission inquired whether a third party should be permitted to overlash an existing cable system or  S -telecommunications carrier's attachment without the agreement of the pole owner.V } {O-ԍNotice, 12 FCC Rcd at 11732, para. 15. V  S - ` #xA66.` ` As stated above, NCTA reports that it is current practice for cable operators routinely to  xoverlash their existing attachments without specific prior notification to the pole owners outside of  S4- xprovisions for major modification contained in their pole attachment agreements.E42 } {O-ԍSee NCTA Comments at 6.E Attaching entities  xassert that pole owners can exert a veto to market entry if allowed to restrict overlashing of the pole  S- x=attachment facilities. } {OH- xԍSee AT&T Comments at 6; Comcast, et al., Comments at 34, 11; New York Cable Television Assn. Comments at 48; NCTA Comments at 7. Utility pole owners object to overlashing by third parties unless the pole owner  xyis compensated for what they view as an additional infringement on their property, but comment that, if  xjthird party overlashing is permitted without additional compensation, pole owners should have notice of  Sl-the nature and engineering requirements of the overlasher.yZl} {O*#- xԍSee American Electric, et al., Comments at 46; Bell Atlantic Comments at 2; Dayton Power Comments at 1;  xColorado Springs Utilities Comments at 3; GTE Comments at 7; New York State Investor Owned Electric Utilities Comments at 89; SBC Comments at 1012; Sprint Comments at 23; USTA Comments at 67.y  S- ` xB67.` ` Utility pole owners assert that overlashed attachments must occupy the same amount of  xzspace as the initial attachment, be considered a separate attachment, and that the overlasher should be" @,`(`(88R"  S- xrequired to pay the same rate as though it were an initial attaching entity."} {Oh- xԍSee, e.g., American Electric, et al., Comments at 4650. Also commenting that an overlashing entity should  xbe considered an original attaching entity were: Colorado Springs Utilities Comments at 23; Edison Electric/UTC  xComments at 11; New York State Investor Owned Electric Utilities Comments at 910; Sprint Comments at 2; Texas Utilities Comments at 6.  Cable operator and  xtelecommunications carrier interests voice varying opinions on if and how a third party overlasher should  S- xbe counted as an attaching entity, } {O- xԍSee Comcast, et al., Comments at 11 (attaching entity will likely charge the telecommunications overlasher  xia charge to reflect the unusable space so the overlasher would not be a separate attaching entity); KMC Telecom  xComments at 78 (no separate payment to pole owner); Summit Comments at 23 (charging by number of strands  xon an attachment would be futile, anticompetitive, and ignore the utility's monopoly obligation to operate for the  {O$ - x\common good). But see Bell Atlantic Reply at 21 (consider overlasher an entity for unusable costs); ICG  xCommunications Comments at 2122 (consider overlasher an entity for unusable space only); NCTA Comments at  x1920 (if a third party conductor is overlashed to the strand, count that as an entity but charge it only a portion of  xthe support space shared); USTA Comments at 78 (overlasher should pay host attacher for the unusable space portion but not usable space portion of pole attachment fee).  indicating that cross interests are at stake in facilitating competitive  xaccess to the pole, minimizing disruption to existing attachments, and reducing pole attachment fees for  S`-the existing attachers.` } yO- xԍThe more entities that are counted as attaching entities, generally the lower the pole attachment fee for existing attaching entities is.  S- ` }xC68.` ` The record does not indicate that third party overlashing adds any more burden to the pole  xthan overlashing one's own pole attachment. We do not believe that third party overlashing disadvantages  xpole owners in either receiving fair compensation or in being able to ensure the integrity of the pole.  xFacilitating access to the pole is a tangible demonstration of enhancing competitive opportunities in  Sp- xcommunications.Gp} {O-ԍSee Preamble to 1996 Act.G Allowing third party overlashing will also reduce construction disruption (and the  x-expense associated therewith) which would otherwise likely take place by third parties installing new poles  xyand separate attachments. Accordingly, we will allow third party overlashing subject to the same safety,  xreliability, and engineering constraints that apply to overlashing one's own pole attachment. Concerns that  xthird party overlashing will increase the burden on the pole can be addressed by compliance with generally accepted engineering practices. x  SX- ` xD69.` ` We believe that when a host attaching entity allows an overlashing attachment to be  xzinstalled to its own pole attachment by a third party for the purposes of that third party offering and  xproviding cable or telecommunications services to the public, that third party overlashing entity should  S- xbe classified as a separate attaching entity for purposes of allocating costs of unusable and usable space\p} {O"- x;ԍSee Bell Atlantic Comments at 23; Edison Electric/UTC Comments at 14; Carolina Power, et al., Comments  xhat 11; Colorado Springs Utilities Comments at 23; Dayton Power Comments at 1; Duquesne Comments at 28; GTE  xComments at 7; New York Investor Owned Utilities Comments at 79; Ohio Edison Comments at 26; SBC  xComments at 18, Reply at 19; Sprint Comments at 23; Texas Utilities Comments at 6; Union Electric Comments  {O&-at 24. But see Ameritech Comments at 67.\"!$,`(`(88"  S- xzbecause Congress indicated that the unusable space was of equal benefit to all attaching entities.B} {Oh-ԍConf. Rpt. at 206. B In  xorder to implement the allocation of unusable space, the third party overlasher will necessarily need to  xkhave some understanding or agreement with the pole owner, and an agreement with the host attaching  xentity. Commenters assert that overlashing under these circumstances should be classified as a separate  S`-attachment.7\`Z} {OZ- xԍSee Bell Atlantic Comments at 23; Edison Electric/UTC Comments at 1314; Carolina Power, et al.,  {O$- xComments at 89; GTE at 7; Sprint Comments at 23; Texas Utilities Comments at 5. But see Ameritech Comments at 67.7 We agree.  S-x` `  hh(c)@Lease and Use of Excess Capacity/Dark Fiber  S- ` xE70.` ` Recent technological advances have made it possible for excess capacity within a fiber  x/optic cable, known as "dark fiber," to be leased from an attaching entity by a third party. Dark fiber  xLconsists of the bare capacity and does not involve any of the electronics necessary to transmit or receive  xsignals over that capacity. It thus differs from dim or lit fiber by which the carrier provides some or all  xLof the electronics necessary to power the fiber. The Commission requested comment on whether a third  xparty using dark fiber should be counted as a separate pole attaching entity for purposes of establishing  S -the number of attaching entities on a pole among whom to apportion the costs of unusable space.U ~} {O-ԍNotice, 12 FCC Rcd at 11735, para. 25. U  S - ` xF71.` ` SBC asserts that the Commission should not address the issue of dark fiber because it is  SX- xthe subject of a remand from the U. S. Court of Appeals for the D.C. Circuit.X} {O-ԍSee SBC Comments at 1213 (citing Southwestern Bell Tel. Co. v. FCC, 19 F.3d 1475 (D.C. Cir. 1994)). In Southwestern Bell,  xLECs challenged a series of Commission orders finding that the LECs were offering dark fiber on a  xcommon carrier basis and prescribing tariffed rates for the service. The petitioners claimed that the  xjCommission exceeded its jurisdiction because they had offered dark fiber only on an individualized basis,  xthereby placing this service beyond the Commission's authority over common carrier offerings under Title  S-II of the Communications Act.S} {O-ԍSouthwestern Bell, 19 F.3d at 1484. S  SD- ` xG72.` ` We believe that our jurisdiction to consider the leasing and use of dark fiber to the extent  S- xit is used to provide telecommunications services is consistent with the court's holding in Southwestern  S- x[Bell. The court concluded that the Communications Act delegates broad authority to the Commission to  xregulate constantly evolving communications facilities that have transcended in complexity and power far  S- xjbeyond the specific technologies known to its drafters in 1934.24 } {O|#-ԍId. 2 Section 224 gives the Commission the  x=mandate and the jurisdiction to regulate pole attachment rates for facilities over which cable television or  x.telecommunications services are provided, and therefore our consideration of dark fiber in this context is appropriate for this proceeding. "" ,`(`(88z"Ԍ S- ` QxH73.` ` There is general consensus among cable operators and telecommunications carriers that  x=the leasing and use of dark fiber by third parties places no additional spatial or physical requirements on  S- xythe utility pole.Z} {O- xԍSee Ameritech Comments at 6; AT&T Comments at 6; Comcast, et al., Comments at 18; ICG Communications  xComments at 21; KMC Telecom Comments at 78; MCI Comments at 9; NCTA Comments at 7; RCN Comments at 5.  Cable operators, telecommunications carriers, and utility pole owners all contend that  xthe use of dark fiber is a procompetitive, environmentally sound and economical use of existing  S`- xyfacilities.iZ`} {O- xYԍSee, e.g., AT&T Comments at 6; Edison Electric/UTC Comments at 13, Reply at 15; GTE Comments at 78;  xKMC Telecom Comments at 78; NCTA Comments at 7; New York Cable Television Assn., Comments at 78; New York Investor Owned Electric Utilities Comments at 11; US West Comments at 10.i We agree and conclude that the leasing of dark fiber by a third party is not an individual pole  x\attachment separate from the host attachment. Such use will not require payment to the pole owner  S- xseparate from the payment by the host attaching entity.dZ } {O - xLԍSee AT&T Comments at 6; New York Cable Television Assn. Comments at 78; Edison Electric/UTC  xComments at 13; GTE Comments at 7; ICG Communications Comments at 1719; KMC Telecom Comments at 78; MCI Comments at 6; NCTA Comments at 7; RCN Comments at 5; USWest Comments at 10. d We also agree with cable operators,  S- xtelecommunications carriers, and utility pole owners$. } {O- xԍSee, e.g., Colorado Springs Utilities Comments at 3; Duquesne Light Comments at 29; Edison Electric/UTC  xComments at 13; GTE Comments at 7; NCTA Reply at 12; New York Cable Television Assn., Comments at 78;  {OH- x<SBC Reply at 6; USTA Reply at 15. But see AT&T Comments at 56; Comcast, et al., Comments at 18; Sprint Reply at 26.  that, if an attachment previously used for providing  xsolely cable services would, as a result of the leasing of dark fiber, also be used for providing  xtelecommunications services, the rate for the attachment would be determined under Section 224(e),  Sp-consistent with our discussion regarding restrictions on services provided over pole attachments.Ip} {O*-ԍSee Section IV.A.2 above. I  S -x` `  d.Presumptive Average Number of Attaching Entities x` `  S - ` `xI74.` ` The Commission presently uses rebuttable presumptions in the context of establishing  xreasonable pole attachment rates. These presumptions help to reduce reporting requirements and record xmkeeping, and are more efficient so there is less administrative burden on all parties. The use of  xpresumptions provides a level of predictability and efficiency in calculating the appropriate rate. Fairness  xis preserved because the presumptions may be overcome through contrary evidence. We seek to maintain  S- xypredictability, efficiency and fairness in determining the costs of unusable space on a pole. In the Notice,  xthe Commission stated that a polebypole inventory of the number of entities on each pole would be too  x>costly. The Commission proposed that each utility develop, through the information it possesses, a  xpresumptive average number of attachers on one of its poles. The Commission also proposed that  xtelecommunications carriers be provided the methodology and information underlying a utility's  SB- xpresumption. The Notice sought comment on this proposal and on whether any parameters should be  S- xyestablished in developing the presumptive average. The Notice also sought comment on whether a utility  xshould develop averages for areas that share similar characteristics relating to pole attachments and  S- x/whether different presumptions should exist for urban, suburban, and rural areas. The Notice sought"#,`(`(88"  S-comment on the criteria to develop and evaluate any presumption.T} {Oh-ԍNotice, 12 FCC Rcd at 11735, para. 26.T  S- ` xJ75.` ` The Commission asked whether, as an alternative to polebypole inventory by the facility  xowners, the Commission should determine the average number of attachments. The Commission inquired  x\as to whether it should initiate a survey to develop a rebuttable presumption regarding the number of  xattachments. The Commission also sought comment on the difficulties of administering a survey, any  S- x[additional data required, and parameters of accuracy and reliability required for fair rate determination.EZ} {O -ԍId. at 11735, para. 27.E  S- ` _xK76.` ` Generally, commenters agree with the idea that a presumptive average number of attachers  xshould be developed, but disagree on how this should be accomplished. The utilities generally support  Sp- xdeveloping their own average as the most efficient method.{Zp} {O - x,ԍSee American Electric, et al., Comments at 44; Ameritech Comments at 13; Edison Electric/UTC Comments  xLat 24; Carolina Power, et al., Comments at 7; KMC Telecom Comments at 7; MCI Comments at 15; NCTA Comments at 20; New York State Investor Owned Electric Utilities Comments at 24; USTA Comments at 13.{ Several attaching entities support the  xCommission's development of the presumptive average and encourage the establishment of a rebuttable  S - xpresumption of at least three attachers._ } yO-ԍAT&T Comments at 14; Comcast, et al., Comments at 810._ Comcast, et al., in particular, encourages a presumptive average  x.of six attaching entities as supported by the Commission's Fiber Deployment Update End of Year 1996  S - x("Fiber Deployment Update").O\ } {O- xԍJonathan Kraushaar, Fiber Deployment Update End of Year 1996 released by the Common Carrier Bureau  {O- xof the Federal Communications Commission on August 29, 1997 ("Fiber Deployment Update"); see also Comcast, et al., Comments at 810.O U S West indicates that having the Commission develop the presumptive  S - xyaverage will serve efficiency, minimize complaints, and place the burden of rebuttal on the pole owner.D } yO -ԍU S West Comments at 9 n.25.D  SZ- ` xL77.` ` We believe that the most efficient and expeditious manner to calculate a presumptive  xnumber of attaching entities is for each utility to develop its own presumptive average number of attaching  x entities. Utilities not only possess this information but have familiarity and expertise to structure it  xproperly. Based on the record, we think the alternative of the Commission undertaking a survey is too  S- x.cumbersome and would not necessarily enhance accuracy. We do not believe that the Fiber Deployment  S- xUpdate is an appropriate resource from which to develop the presumptive average. The Fiber Deployment  Sn- x[Update presents data about fiber optic facilities and capacity built or used by interexchange carriers, Bell  xoperating companies, and other LECs and competitive access providers. These data are inadequate for  xthe purposes of creating a presumptive average number of attaching entities because it does not include  xdata pertaining to cable operators. Our decision providing that the utility will establish a presumptive  xnumber of attaching entities is also premised on the information developed reflecting where the service  x is being provided, instead of a broad national average. We think there will be a range of presumptive  x^averages depending on rural, urban, or urbanized areas. To ensure that rates are appropriately  xrepresentative, each utility shall determine a presumptive average for its rural, urban, and urbanized service areas as defined by the United States Census Bureau."0$R ,`(`(88"Ԍ S- ` ԙxM78.` ` We will require each utility to develop, through the information it possesses, a presumptive  xkaverage number of attaching entities on its poles based on location (urban, rural, urbanized) and based  xyupon our discussion herein regarding the counting of attaching entities for allocating the costs of unusable  xspace. A utility shall, upon request, provide all attaching entities and all entities seeking access the  x=methodology and information by which a utility's presumption was determined. We expect a good faith  x effort by a utility in establishing its presumption and updating it when a change is necessitated. For  xexample, when a new attaching entity has a substantial impact on the number of attaching entities, the  xutility's presumptive average should be modified. This method should be consistent with present practice,  xas we understand most pole attachment agreements "provide for periodic field surveys, generally once  S- xevery three to seven years, to determine which entities have attached what facilities to whose poles."A} yO -ԍICG Communications at 37.A  SH - ` xN79.` ` Challenges to the presumptive average number of attaching entities by the  xytelecommunications carrier or cable operator may be made in the same manner as challenges presently are  xundertaken. The challenging party will initially be required to identify and calculate the number of  xattachments on the poles and submit to the utility what it believes to be an appropriate average. Where  x.the number of poles is large, and complete inspection impractical, a statistically sound survey should be  x]submitted. The pole owner will be afforded an opportunity to justify the presumption. Where a  x=presumption is successfully challenged, the resulting figure will be deemed to be the number of attaching entities.  S-x` ` 5. Allocating the Cost of Usable Space  S-x` `  a.Background  S@- ` _xO80.` ` Section 224(e)(3) provides that a utility shall apportion the cost of providing usable space  S- x^among all entities according to the percentage of usable space required for each entity.AX} yO-ԍ47 U.S.C.  224(e)(3).A The  S- xCommission has defined usable space as the space on the utility pole above the minimum grade level} yOx- xԍIn this context, minimum grade level generally refers to ground level or elevation above which distances are measured for determining required clearances.  S- xMthat is usable for the attachment of wires, cable, and related equipment.@@} yO-ԍ47 C.F.R.  1.402(c).@ In the Second Report and  S- xOrder,5} yO!-ԍ72 FCC 2d 59.5 the Commission considered comment regarding the amount of usable space for various size poles  xin different service areas. The Commission subsequently adopted a rebuttable presumption that a pole  ST- xkcontains 13.5 feet of usable space.lT` } {OT$-ԍId. at 69; Third Report and Order, 77 FCC 2d at 191193.l The usable space presumption has been contested in complaint  S,- xkproceedings before the Commission., } {O&- xԍSee, e.g., Cable Information Services, Inc. v. Appalachian Power Co., 81 FCC 2d 383 (1980); Television Cable  {O'-Service, Inc. v. Monongahela Power Co. v. FCC, 655 F.2d 1254 (D.C. Cir. 1981). In 1986, the Commission revisited the usable space issue and",%N ,`(`(88"  S- xupheld the presumption.T} {Oh-ԍPole Attachment Order, 2 FCC Rcd 4387.T In 1997, the Commission sought comment on the presumptive amount of  S- xyusable space in the Pole Attachment Fee Notice.jZ} {O-ԍPole Attachment Fee Notice, 12 FCC Rcd at 745859, para. 18.j In the Notice, we sought comment on the usable space  xpresumption to establish a full record for attachments made by telecommunications carriers under the 1996  S- xAct.T} {O-ԍNotice, 12 FCC Rcd at 11733, para. 17.T The Commission also proposed to modify the current methodology to reflect only the cost  x|associated with usable space to arrive at a factor for apportioning the costs of usable space for  S:- xtelecommunications carriers under Section 224(e)(3).F:~} {OX -ԍId. at 11737, para. 33. F For allocating the costs of usable space to telecommunications carriers, the following basic formula was proposed:  S-   #&a\  P6G;0&P#Usablex` ` Space Occupied by AttachmenthTotal Usable Space  Net Cost of 0Carrying  S-Spacex=` ` Total Usable Spacehh@ X hPole Height X  Bare Pole X 0Charge Rate Factor      S - ` xP81.` ` In the Notice, the Commission sought comment on the amount of usable space occupied  x<by telecommunications carriers and on whether the presumptive one foot used for cable attachments should  S - xbe applicable to telecommunications carriers generally.E } {O\-ԍId. at 11733, para. 19.E Currently, each attaching entity is presumed to  xuse a specific amount of space, and costs are allocated on the proportion of this space to the overall costs  S\- xof the usable space. The 1977 Senate Report evidenced Congress' intent that cable television providers  x\be responsible for 12 inches of usable space on a pole, including actual space on a pole plus clearance  S- x?space.G} {OP-ԍ1997 Senate Report at 20.G In 1979, the Commission established the rebuttable presumption that a cable television  S- xattachment occupies one foot.[4 } {O-ԍSecond Report and Order, 72 FCC 2d at 6970. [ The Commission subsequently refined its methodology for determining  S- xthe amount of usable space and made the one foot presumption permanent.b } {O$-ԍId., see also Usable Space Order at para. 10. b The Commission found  S- xthis result to be consistent with the legislative history of Section 224, as expressed in the 1977 Senate  Sp-Report.MpX } {Oh"-ԍUsable Space Order at para. 10.M  S"- ` PxQ82.` ` Determining the presumptive amount of usable space attributable to each attacher directly  ximpacts the allocation of costs. Section 224(d)(1), which predates the 1996 Act, specifies that the  xMmaximum just and reasonable pole rate shall be determined by multiplying the percentage of the total  xzusable space that is occupied by the pole attachment by the sum of the operating expenses and actual"&,`(`(88#"  S- xcapital costs attributable to the entire pole.A} yOh-ԍ47 U.S.C.  224(d)(1).A Each factor is individually determinable, and in some cases  xzhas been assigned a presumptive average value for purposes of resolving complaints in an expeditious  xmanner. The current pole attachment rate methodology consists of a usable space factor that is the result  xof dividing the space occupied on the pole, or the presumptive one foot assigned to a cable attachment,  S`-by 13.5 feet or the total amount of usable space.`X} {OX-ԍSee Notice, 12 FCC Rcd at 11736, para. 29. The current methodology is represented by the following formula: h ddx !ddx"b~~b~b h  j &g&  Maximum Rate   =   aESpace Occupied by Attachment Total Usable Space   X  Net Cost of Bare Pole   X  Carrying Charge Ratej"g yO -ԁ x  S-  x` `  b.Discussion  Q- hx` `  (1) hhApplying the 13.5 Foot Presumption and the One Foot  Q-Presumption to Telecommunications Carriers(#h x  SH - ` oxR83.` ` The law provides a method for the allocation of costs associated with the usable space.  xkWe believe that the information we received in this proceeding regarding calculation of usable space is  S - xLmore appropriately addressed in the Pole Attachment Fee Notice proceeding and we will thus reserve our  xdecision on the total amount of usable space issue until the resolution of that proceeding. For the present  xtime, the presumption that a pole contains 13.5 feet of usable space will remain applicable. We adopt our  xproposed methodology to apportion the cost of the usable space. We believe this formula most accurately  xdetermines the apportionment of the cost of usable space. As mandated by Congress, it incorporates the  xprinciple of apportioning the cost of such space according to the percentage of space required for each entity. x  S- ` xS84.` ` The Commission's one foot presumption has been in place since 1979. The Commission  xyinitially assigned the one foot presumption to cable television operators based on congressional intent, as  x.expressed in the legislative history of Section 224, that cable television was to be assigned only one foot  xof space, the electric utilities' use of safety space, and an analysis of replacement costs that utilities impose  S- xkon cable television companies.M} {O-ԍUsable Space Order at para. 10.M The Commission concluded in the Usable Space Order that several  x=years of experience in regulating pole attachments had not indicated that cable attachments occupy more  S- xspace than the one foot of usable space as originally contemplated by Congress.1} {O!-ԍId.1 Neither the 1996 Act's  xjamendments to Section 224 nor the record in this proceeding suggest that a different presumption should  xMbe applicable to telecommunications carriers. Circumstances that are unique or that clearly warrant a  xdeparture from the formula may be used to rebut the presumption. We affirm our practice of assigning  xa presumptive one foot of usable space and find that the presumptive one foot used for cable attachments  x[should be applied to attachments by telecommunications carriers generally. We believe that the one foot  xpresumption remains reasonable and continues to provide an expeditious and equitable method for determining reasonable rates."'@ ,`(`(88"Ԍ S- ` #ԙxT85.` ` Some utility pole owners and telecommunications carriers suggest changes to the one foot  S- xpresumption and express other concerns.>x} yO@- x-ԍAdelphia, et al., Comments at 8; Duquesne Light Comments at 3536; Ohio Edison at 33; New York State  xInvestor Owned Electric Utilities Comments at 5 (one foot presumption found appropriate for span wire attachments  xwoccupying no more than one foot of space on the pole, but inappropriate for attachments occupying more than one  xfoot of usable space); New York Cable Television Assn. Comments at 7 (parties with separately stranded attachments  xoccupying their own (one foot) are responsible for their proportionate share of such space, but where facilities are  xaffixed by additional strands, then the party should be responsible for two feet of usable space); RCN Comments at 78.> Some electric utilities have sought to alter the presumptive  xamount of usable space allocated when fiber optic cable is involved. For example, Duquesne Light and  xOhio Edison contend that, in their service areas, tightly pulled fiber optics will be at the same height at  xthe mid span of the pole as a cable television attachment above it that is hung with the normal required  S8- xsag.Z8} {O - xԍSee Duquense Light Comments at 3536; Ohio Edison Comments at 33. But see AT&T Comments at 23 (if  x-the fiber optic is properly deployed, the presumption should remain the same for fiber or any other type cable); Comcast, et al., Reply at 20 (such an approach is an attempt to tax and penalize third party fiber deployment). They argue that this is in violation of the NESC code which requires parallel attachments to be  S- xyseparated by appropriate distances between the spans of the poles as well as on the poles themselves.o* } {O-ԍSee Duquense Light Comments at 3536; Ohio Edison Comments at 33.o  xLDuquesne Light and Ohio Edison further maintain that, because the tensioned fiber optic cable cannot be  xeasily sagged except by cutting and rerunning the cable, the fiber optic cable must be relocated higher on  S- xthe pole.1 } {O-ԍId.1 They recommend that the Commission adopt a rebuttable presumption that fiber optic cable  xrequires, and should be charged for, two feet of usable space to account for the communications  SH -companies' practice of pulling fiber optic cables tightly.1 H N } {O6-ԍId.1  S - ` QxU86.` ` The impact of deploying fiber optic cable is dependent upon how the fiber is attached.  xxThe rebuttable nature of the one foot presumption offers an opportunity for the presentation of information  xin situations outside of the norm. The record does not contain sufficient information to base a decision  x=on the impact of the practice of pulling fiber optics cable tightly, and therefore we will not presume that fiber optics require two feet of usable space.  S- ` xV87.` ` We disagree with ICG Communications' position that the Commission's one foot  S- x?presumption is outdated and should be abandoned.J } yO`!-ԍICG Communications Comments at 39.J ICG Communications maintains that most  S- xcommunications attachments should only be allocated six inches of usable space.  "p} {O#- xԍId. (maintaining that overlashed cable combinations below the safety space should be allocated nine inches of  xusable space); ICG Communications Reply at 22 (if the Commission makes six inches of usable space the basis for  xSection 224(e) rates, utilities may stop imposing unnecessary makeready costs on attaching parties and instead increase their pole attachment revenues by permitting more attaching parties on each pole).  ICG Communications  xnotes that the NESC does not distinguish between cable used for cable operators and cable used for"(Z ,`(`(88"  S- xtelecommunications carriers.8 } {Oh-ԍId. at 21.8 Based on accepted engineering and governmentallyrequired standards,  S- xit advocates six inches of usable space for simple communications attachments below the safety space.   Z} yO- xԍIGG Communications Comments at 4043 (concluding that a utility should charge a telecommunications carrier  x<for a foot of usable space only upon agreement of the carrier or by establishing that an applicable governmental  xrequirement dictates a one foot clearance between communications lines and suggesting that utilities be permitted to seek different usable space allocations in their negotiation of pole attachment agreements).   xICG Communications notes that where communications lines have been installed in electric supply space,  xyespecially fiber optic cables, more than one foot of usable space is required and an allocation of 16 inches  S`-of usable space should be made.2`B} {OB -ԍId. 2  S- ` _xW88.` ` Bell Atlantic contends that there is no factual support for ICG Communications' claims.C} yO-ԍBell Atlantic Reply at 17. C  xBell Atlantic points to Bellcore's Manual of Construction procedures as demonstrating that clearance at  xthe pole between communications cables supported on different strands of suspension must be at least 12  S- x>inches.d } {O-ԍId. (citing Bellcore, Blue Book Manual of Construction Procedure,  3.2 (Issue 2 1996)). SBC maintains that ICG Communications' proposals are based on improper assumptions,  Sp- xespecially regarding overlashing.8p } yO-ԍSBC Reply at 26.8 SBC maintains that the one foot presumption is still valid today.up } {O-ԍId.; see also Edison Electric/UTC Comments at 2526, Reply at 25.u  xWe agree that ICG Communications has not adequately supported its suggested allocation of six inches of space for most communications attachments or 16 inches for fiber optic cables.  S - ` ~xX89.` ` Adelphia, et al., express concern regarding the validity of assigning the cost of a vertical  xonefoot of pole space to cable systems and/or other telecommunications providers without considering  S - xthe horizontal uses of the pole by the pole owner.H } yO8-ԍAdelphia, et al., Comments at 8.H Adelphia, et al., also suggest that the particular side  SX- xof the pole on which the attachment is located is of significance.1X} {O-ԍId.1 RCN observes that the one foot  S0- xpresumption should not apply where extension arms or boxing0:} yO "- x;ԍRCN describes boxing or "bbolting" as a process by which an attachment is bolted through the back of a pole, opposite from an existing attachment. RCN Comments at 8. is used by the attaching entity to install  S- xits facilities.f} {O:%-ԍId. at 78. But see Comcast, et al., Reply at 20.f RCN suggests that where extension arms are used, the communications cable is located  xnot on the pole itself, but farther out on the extension arm. RCN states that this will lead to a situation")$,`(`(88*"  S- xLwhere an entity's physical attachment may occupy as little as six inches of usable space.=} yOh-ԍRCN Comments at 78. = RCN claims  xthat this configuration will still satisfy the 12inch clearance required between communications  S-attachments, if the cable is positioned a certain distance along the extension.aX} {O-ԍId.; see also Bell Atlantic Reply at 18 n.43.a  S- x  S`- ` xY90.` ` Sufficient record has not been presented to change our presumption as a general matter,  xMalthough parties are free to challenge the presumption on a casebycase basis. In striking the proper  x balance, we must weigh any of the suggested modifications against the advantages of procedures and  S- x calculations remaining simple and expeditious.m} {Or -ԍSee 72 FCC 2d at 69 (citing 1977 Senate Report at 2122).m We agree with GTE that changing the usable space  xpresumption would add another layer of complexity to the pole attachment rate formula. As GTE  S-suggests, surveys of the actual space occupied by each attacher would be necessary.8|} yO-ԍGTE Reply at 15.8  SH - ` 2xZ91.` ` We agree with those commenters who have found the presumptive one foot applicable.H } yO- xԍCarolina Power, et al., Comments at 1213; GTE Comments at 13, n.29; MCI Comments at 17 (fiber cable  xand coaxial cable share the same vertical separation requirements in the NESC, therefore there is no need to treat  xthem differently for space allocation purposes); Ameritech Comments at 9 (there are no differences between cable  x system facility attachments and telecommunications attachments to warrant different presumptions in the formula for the space required for each); NCTA Comments at 13; Adelphia, et al., Comments at 7; U S West Comments at 5.  x.We further affirm our decision to continue using the current methodology, modified to reflect only costs  S - x.associated with usable space.&$ } {OT- xԍNotice, 12 FCC Rcd at 11737, para. 33 & n.60 (referencing paras. 1519 regarding comments sought involving  {O- xthe Commission's usable space presumptions); see also Carolina Power, et al., Comments at 15 (asserting that the  xcurrent formula should be used to establish presumptively applicable maximum charges, provided that the formula is further modified for purposes of Section 224(e)); Ameritech Comments at 10; U S West Comments at 5.& Commenters have not persuaded us that the rationale originally used in  xassigning the one foot of space to cable television operators should not be equally applicable to  x1telecommunications carriers generally. We continue to see the need and basis for the one foot  S - xjpresumption due to the impracticality of developing sufficient information applicable to all situations.S } {O-ԍNotice, 12 FCC Rcd at 11733, para 19.S  xWhere use of the one foot presumption would not encourage just and reasonable rates, any party may rebut the presumption. x  Q-x` `  (2)hh Overlashing and Dark Fiber  S- ` x[92.` ` Consistent with our above discussion regarding overlashing, we find that the one foot  Sh- xpresumption shall continue to apply where an attaching entity has overlashed its own pole attachments.9h:} yOB&-ԍSee Section IV.A.9  x[We also determine that facilities overlashed by third parties onto existing pole attachments are presumed"@*,`(`(88"  S- xto share the presumptive one foot of usable space of the host attachment.} {Oh- xԍSee Ohio Edison/Union Electric Reply at 1113; Edison Electric/UTC Comments at 25; USTA Comments at 78. To the extent that the  xoverlashing creates an additional burden on the pole, any concerns should be satisfied by compliance with  S- x{generally accepted engineering practices. We again note that we have deferred decision to the Pole  S- xAttachment Fee Notice proceeding on the issue of the effect any increased burden may have on the rate  xthe utility pole owner may charge the host attacher. As stated above, we believe that that proceeding is  S<- x/a more appropriate forum for resolution of this issue. <"} {O- xԍSee Section IV.A.1. above (Duquesne Light proposes that any presumptions include weight and wind load factors). As also stated above, we affirm our current presumptions for the time being.  S- ` _x\93.` ` Some commenters have suggested that the third party overlasher should be responsible for  xsome portion of the costs associated with overlashing and be responsible for paying a portion of the costs  St- xto the pole owner.!"t|} {O- xjԍSee, e.g., Duquesne Light Comments at 28. But see USTA Comments at 8 and SBC Comments at 913  x(maintaining that the Commission should not establish any requirements regarding third party overlashing and that  xan attacher allowing a third party to overlash is sublicensing or sharing space to be occupied by the facilities owned by the third party). Carolina Power, et al., argue that because the third party has a statutory right under  SL - xSection 224(f) to make a separate attachment of its own, overlashing should be left to negotiation.O"L f } yOR-ԍCarolina Power, et al., Comments at 10.O They  xmaintain that the Commission should recognize that each overlashed wire equals a separate attachment  S - xkfor which the overlasher may be charged a just and reasonable rate.8# } {O-ԍId. at 11.8 KMC Telecom asserts that the  xMallocation of usable space should be onehalf to the original attacher and the remaining onehalf to the  S - xthird party overlasher.A$ } yO-ԍKMC Telecom Reply at 78.A ICG Communications advocates the allocation of four and onehalf inches of  S - xusable space to each party when one party overlashes another's cable.M% } yO<-ԍICG Communications Comments at 2122.M MCI recommends sharing the  x!presumptive one foot of space assigned to cable operators' and telecommunications carriers' pole  S4- xattachments with overlashers.b&4} yO| -ԍMCI Comments at 6; MCI CS Docket No. 9798 Comments at 13.b MCI argues that because overlashing expands usable space, there should  xkbe a presumptive number of two overlashings per original attachment as an estimate of the number of  S- xoverlashings.1'8} {O#-ԍId.1 MCI asks the Commission to further presume that there will be four attachments: one  xfor a cable operator; one for the ILEC; one for an independent competitive LEC; and one for a LEC  S- xaffiliated with the incumbent electric company.:(} yO&-ԍMCI Comments at 9.: It alleges that if there are four nonelectric attachments,"+Z(,`(`(88"  xand two overlashings per original attachment, the same 6.5 feet of space can presumptively accommodate  S- xj12 attachments.D)} yO@-ԍMCI Comments at 10, Table 1.D Ohio Edison and Union Electric argue that there is no rational basis for adopting such  xMan approach under Section 224(e)(3) because the utility pole owner is entitled to charge the attaching  S-entity for one foot of usable space regardless of whether the original attachment is overlashed.R*X} yO-ԍOhio Edison/Union Electric Reply at 1415.R  S8- ` x]94.` ` We disagree with these comments suggesting that the Commission must establish the rate  xand the allocation of cost between the third party overlasher and the host for the use of one foot of usable  xspace. The benefit of third party overlashing as an expeditious means for providers, including new  xentrants, to gain access to poles would be undermined by such procedures. Unlike the pole owner, the  xhost attaching party generally will not have market power visavis the overlasher since the overlasher has  xa statutory right to make an independent attachment. Accordingly, we conclude that it is reasonable to  xallow the host attaching entity to negotiate the sharing of costs of usable space with third party  xoverlashers. In such circumstances the host attaching entity will remain responsible to the pole owner for  xthe use of the one foot of usable space but may collect a negotiated share from the third party overlasher.  xWe have already addressed the counting of third party overlashers as a separate entity and established that  xyif such third party provides cable or telecommunications service it will be required to pay its share of the  xcosts of the unusable space. Further, we find that the record in this proceeding is not sufficient to  xembrace MCI's proposal. While overlashing is frequent, we cannot determine from the record that it is  x<as prevalent as MCI proposes. We are reluctant to conclude that its presumptions are generally applicable.  xNo other party has advocated a similar proposal. Moreover, we see no need to adopt MCI's proposal  xgiven our determination that there is no need to regulate the sharing of costs between the host attaching entity and the overlashing entity.  Sh- ` 4x^95.` ` Regarding the leasing of dark fiber, to the extent that dark fiber is used to provide a  xtelecommunications service within an existing attachment generally, the majority of commenters do not  S- x>believe that such activity constitutes a separate attachment under Section 224.?+Z} {O- xԍSee, e.g., Edison Electric/UTC Reply at 26 (leasing of dark fiber has no impact on the amount of usable  xspace); New York State Investor Owned Electric Utilities Comments at 10; NCTA Comments at 8 (rental of dark fiber is not an attachment). ? As stated above in  xSection IV.A.4.c., we agree. The one foot presumption is therefore only applicable to the host  S-attacher.` `  x  SP-x B.` ` Application of Pole Attachment Formula to Telecommunications Carriers (#`  S-x` ` 1. Background  S- ` x_96.` ` To implement the 1978 Pole Attachment Act, the Commission developed a methodology", +,`(`(88"  S- xand implementing formula to determine a presumptive maximum pole attachment rate.z,~} {Oh- xԍ47 U.S.C.  224(d)(1); 47 C.F.R. 1.1409(c); see Second Report and Order, 72 FCC 2d at 6775, Teleprompter  {O2- xof Fairmont, Inc. v. Chesapeake and Potomac Telephone Co. of West Virginia, PA 790029, 79 FCC 2d 232 (1980);  {O- xxContinental Cablevision of New Hampshire, Inc. v. Concord Electric Co., Mimeo No. 5536 (Com. Car. Bur., July  xw3, 1985). Under the current methodology, cable operators providing only cable services pay a portion of both usable  xand unusable space on the pole. The cable cost of the usable space is directly assigned in proportion to the usable  x-space on a pole. The cost of the unusable space is treated as an indirect cost and is assigned in the same manner as direct costs.z The Commission  S- xyregulates pole attachment rates by applying this formula ("Cable Formula")L-} yO -ԍ47 U.S.C.  224(b)(1), (d). L to disputes between cable  S- xoperators and utilities. The Cable Formula is based on Section 224(d)(1) that stipulates a rate is just and reasonable if it:  ` `XxX` ` . . . assures a utility the recovery of not less than the additional costs of providing pole  ` ~attachments, nor more than an amount determined by multiplying the percentage of the  ` %total usable space, or the percentage of the total duct or conduit capacity, which is  ` occupied by the pole attachment by the sum of the operating expenses and actual capital  S-costs of the utility attributable to the entire pole, duct, conduit, or rightofway.C.} yO-ԍ47 U.S.C.  224(d)(1). C (#`  SL - xLCurrently, application of the Cable Formula results in a rate that is in the range between the incremental  S& -and fully allocated costs of providing pole attachment space./ & . } yO- xwԍIn the pole attachment context, incremental costs are those costs that the utility would not have incurred "but  xfor" the pole attachments in question. Fully allocated costs refer to the portion of operating expenses and capital  xycosts that a utility incurs in owning and maintaining poles that are associated with the space occupied by pole attachments.  S - ` x`97.` ` Section 703(6) of the 1996 Act amended Section 224 by adding a new subsection (d)(3).  S - x~This amendment expanded the scope of Section 224 by applying the Cable Formula to  S - xtelecommunications carriers in addition to cable systemsA0 } yO>-ԍ47 U.S.C.  224(a)(4).A until a separate methodology is established for  S`-telecommunications carriers.1`} {O-ԍSee 47 U.S.C.  224(d)(3) (only to the extent that such carrier is not a party to a pole attachment agreement). We invited further comment on this issue in the Notice.2&`8} {O8!- xԍNotice, 12 FCC Rcd at 11737, para. 33. In the Pole Attachment Fee Notice, the Commission inquired about  {O"- x=certain technical changes proposed for the Cable Formula. Pole Attachment Fee Notice, 12 FCC Rcd 7449,  {O"- xgenerally. Certain changes, if adopted, may require technical corrections to the Cable Formula and new formula. We will examine these issues in the separate rulemaking.   S- ` xa98.` `  Congress directed the Commission to issue a new pole attachment formula under Section  x224(e) relating to telecommunications carriers within two years of the effective date of the 1996 Act, to"-&2,`(`(88"  S-become effective five years after enactment.A3} yOh-ԍ47 U.S.C.  224(e)(1).A In the 1996 Act, Section 224(e)(1) provided:  XxThe Commission shall...prescribe regulations in accordance with this subsection to  Cgovern charges for pole attachments used by telecommunication carriers to provide  telecommunications services, when the parties fail to resolve a dispute over such charges.  #Such regulations shall ensure that a utility charges just, reasonable, and nondiscriminatory  S-rates for pole attachments.A4X} yO -ԍ47 U.S.C. 224(e)(1).A   S- ` xb99.` ` In the Notice, the Commission proposed to modify the Cable Formula to accommodate  S- xthe two statutory components added by the 1996 ActV5} {O" -ԍSee 47 U.S.C.  224(e)(2), (e)(3). V and to develop a maximum pole attachment rate  Sr- xfor telecommunications carriers.V6rz} {O-ԍNotice, 12 FCC Rcd at 11737, para. 33. V These components dictate separate calculations for the equal  SJ -apportionment of unusable spaceC7J } yO-ԍ47 U.S.C.  224(e)(2). C and the allocation of a percentage of usable space.C8J } yO-ԍ47 U.S.C.  224(e)(3). C  S - ` xc100.` ` In paragraphs 41 and 78 above, the Commission affirms its proposals to use certain  xformulas implementing Section 224(e)(2) and Section 224(e)(3) respectively. The formula for Section  S - xL224(e)(2) establishes the unusable space factors for telecommunications carriers,9 , } yOv- xԍFor allocating the cost of unusable space to telecommunications carriers, see discussion at paragraphs 4344 above for the following basic formula: r ddx !dd,X,,,0@@@@@@@@@r    .v .  yO-#C\  P6QIP#Unusable Space   Factor >   d > d   = >  yO-d > d2   3 >   d > d   X >  yO-d > d*Unusable Spaceă   *Pole Height > ك  d > d   X >  yO-d > dNet Cost of Bare Pole   Number of Attachers >   d > d   X >   d > dCarrying   Charge Rate  v premised on an equal  S - xKapportionment of twothirds of the costs of providing unusable space on the utility facility.a: } yO-ԍSee discussion on Unusable Space at Section IV above. a The formula  xMfor Section 224(e)(3) establishes the usable space factors for cable operators and telecommunications  S2- xcarriers providing telecommunications services,';2t} yOF"- x-ԍFor allocating the cost of usable space for telecommunications carriers, see discussion at paragraphs 8082 above for the following basic formula: r ddx !ddx#~~~b~b r  j  .g .  Usable Space Factor@&g  =@&g  aEN$Space Occupied by Attachment Total Usable Space@&g  X@&g  aEN$Total Usable Space Pole Height@&g  X@&g Net Cost of Bare Pole@&g  X@&g Carrying Charge Ratej # g yO@&-' premised on the percentage of usable space required for"2.;,`(`(88;"  S-the attachment on the utility facility.]<} yOh-ԍSee discussion on Usable Space at Section IV above. ]  S- ` xd101.` ` AT&T observes that there was almost unanimous support from cable operators and  x.telecommunications carriers for the Commission's proposed telecommunications carrier pole attachment  S`- xrate formula.E=`X} {OX-ԍSee AT&T Reply at 15. E Several utility pole owners support the Commission's use of its proposed modified  S8- x{formula, but advocate the use of gross book instead of net book costs.>8} {O - xԍSee, e.g., Bell Atlantic Comments at 4; Colorado Springs Utilities Comments at 4; SBC Comments at 2930; USTA Comments at 10. American Electric, et al.,  S- x advocate that when applied the formula should use forwardlooking/replacement costs.t?D} {O -ԍSee American Electric, et al., CS Docket No. 9798 Comments at 4245. t Attaching  xentities urge the Commission to reject the pole owners' call for replacement costs designed to maximize  S-pole attachment rates.p@} {O6-ԍSee, e.g., ICG Communications Reply at 2627, NCTA Reply at 68. p  Sp-x` ` 2. Discussion  S - ` xe102.` ` We agree with cable operators and telecommunications carriers that the continued use of  xja clear formula for the Commission's rate determination is an essential element when parties negotiate for  S - xpole attachment rates, terms and conditions.nA h } {O-ԍSee, e.g., USTA Reply at 2; But see GTE Reply at 45. n We think that a formula encompassing these statutory  xdirectives of how pole owners should be compensated adds certainty and clarity to negotiations as well  x.as assists the Commission when it addresses complaints. We conclude that the addition of the unusable  xjand usable space factors, developed to implement Sections 224(e)(2) and (e)(3), is consistent with a just,  xreasonable, and nondiscriminatory pole attachment rate for telecommunications carriers. We affirm the  x>following formula, to be used to determine the maximum just and reasonable pole attachment rate for  xtelecommunications carriers, including cable operators providing telecommunications services, effective February 8, 2001, encompassing the elements enumerated in the law: ^ ddx!ddh/8Y@@@@@^      ddMaximum   Rate 0   d 0 d=  0   d 0  >Unusable Space Factor 0  + dUsable Space Factor        h    SP- xC.` ` Application of Pole Attachment Formula to Conduits(#`     S`-x` ` 1. Background     Sp- ` #xf103.` ` Conduit systems are structures that provide physical protection for cables and also allow  xnew cables to be added inexpensively along a route, over a long period of time, without having to dig up  xthe streets each time a new cable is placed. Conduit systems are usually multipleduct structures with" / A,`(`(88"  xstandardized duct diameters. The duct diameter is the principal factor for determining the maximum  x}number of cables that can be placed in a duct. Conduit is included in the definition of pole  S- x[attachments,AB yO-ԍ47 U.S.C.  224(a)(4).A therefore, the maximum rate for a pole attachmentBCX yO-ԍ47 U.S.C.  224(e)(1). B in a conduit for telecommunications  S- xcarriers must be established through separate allocations relating to unusable spaceCD yO-ԍ47 U.S.C.  224(e)(2). C and usable space.CEx yO -ԍ47 U.S.C.  224(e)(3). C  S`- xIn the Notice, the Commission sought comment on the differences between conduit owned and/or used  xby cable operators and telecommunications carriers and conduit owned and/or used by electric or other  S- xutilitiesF {O - xԍThe issues regarding conduit systems were initially raised by the Commission in the Pole Attachment Fee  {O-Notice, 12 FCC Rcd 7449 at paras. 3846. to determine if there are inherent differences in the safety aspects or limitations between the two  S- xLwhich should affect the rate for these facilities as discussed below.TGd  {O-ԍNotice, 12 FCC Rcd at 11739, para. 36.T The Commission sought comment  xon the distribution of usable and unusable space within the conduit or duct and how the determination for  S- xjthis space is made.1H  {O0-ԍId.1 Where conduit is shared, we sought information on the mechanism for establishing  Sr-a just and reasonable rate.2Ir  {O-ԍId. 2     S - ` xg104.` ` Section 224(e)(2) requires that twothirds of the cost of the unusable space be apportioned  SZ - x{equally among all attaching entities.CJZ  yO-ԍ47 U.S.C.  224(e)(2). C In the Notice, the Commission proposed a methodology to  S4 - x.apportion the costs of unusable space among attaching entities.VK4  {O~-ԍNotice, 12 FCC Rcd at 11740, para. 40. V The following formula was proposed   as the methodology to determine costs of unusable space in a conduit: r!ddh/8Y@@@@@Add0   r  h &&     XConduit Unusable   eSpace Factor         ^ =     S-u  2 ă    3         /X   {8   LVNet Linear Cost of  S$-:% Unusable Conduit Space    H#Number of Attachers   {8          AX        Carrying   H Charge Rate S - xIn the Notice, the Commission also sought comment on what portions of duct or conduit are "unusable"  S- xwithin the terms of the 1996 Act.3L< {O&-ԍId. 3 The Commission proposed that a presumptive ratio of usable ducts"0L,`(`(88 "  S-to maintenance ducts be adopted to establish the amount of unusable space.2M {Oh-ԍId. 2     S- ` xh105.` ` Section 224(e)(3) states that the cost of providing usable space shall be apportioned  S- xaccording to the percentage of usable space required for the entity using the conduit.CNZ yO-ԍ47 U.S.C.  224(e)(3). C Usable space is  S- xbased on the number of ductsO yOJ -ԍNESC defines the term "duct" as a single enclosed raceway for conductors or cable. NESC at Section 32. and the diameter of the ducts contained in a conduit.VPz {O -ԍNotice, 12 FCC Rcd at 11739, para. 38. V In the Pole  S- xAttachment Fee Notice,jQ  {OF -ԍPole Attachment Fee Notice, 12 FCC Rcd 7449 at paras. 4346.j the Commission sought comment on a proposed conduit methodology for use  St- xin determining a pole attachment rate for conduit under Section 224(d)(3).CRt yO-ԍ47 U.S.C.  224(d)(3). C In the Notice, the  x\Commission sought comment on a proposed halfduct methodology for use in a proposed formula to  S&- xdetermine a conduit usable space factor.VS&.  {O-ԍNotice, 12 FCC Rcd at 11739, para. 38. V The proposed usable space formula under Section 224(e)(3)   for pole attachments in conduits is as follows:    Add0   add 1f,,,,@@@@@@@@@    . .   Y<Conduit \fUsable _Space   ]xFactor      =  S - 1     2      X  S - 1 Duct  Average Number of Ducts, less Adjustments   for maintenance ducts      X Net Linear Cost of Usable Conduit   Space         X   Carrying Charge   Rate      S- xIn the Notice, the Commission sought comment on the halfduct presumption's applicability to determine  S- xusable space and to allocate costs of providing usable space to the telecommunications carrier.JT C {O-ԍId. at 1173940, para. 39. J The  xzCommission also sought comment on how its proposed conduit methodology impacts determining an  S0-appropriate ratio of usable to unusable space within a duct or conduit.FU0R C {O" -ԍId.at 11740, para. 40. F     S@- ` xi106.` ` As with poles, defining what an attaching entity is and establishing how to calculate the  xnumber of attaching entities in conduit is critical. Consistent with the halfduct convention proposed in  S- xthe Pole Attachment Fee Notice,gVC {Ot%-ԍPole Attachment Fee Notice, 12 FCC Rcd 7449 at para. 45. g the Commission stated that each entity using one halfduct should be"1vV,`(`(88 "  S- xcounted as a separate attaching entity.VWC {Oh-ԍNotice, 12 FCC Rcd at 11740, para. 41. V The Commission sought comment on this method of counting  x>attaching entities for the purpose of allocating the cost of the unusable space consistent with Section  S- x224(e).3XZC {O-ԍId. 3 The Commission also sought comment on the use an attaching entity may make of its assigned  S-space, including allowing others to use its dark fiber in the conduit.3YC {O-ԍId. 3     S-x` ` 2. Discussion   x  S-x` `  a.` Counting Attaching Entities for Purposes of(#   x` `  Allocating Cost of Other than Usable Space  S-  S - ` Pxj107.` ` For the purpose of allocating the cost of unusable space, ICG Communications states that  xeach party that actually installs one or more wires in a duct or duct bank should be counted as a single  Sp - x\attaching entity, regardless of the number of cables installed or the amount of duct space occupied.Zp ~C {O- xԍSee ICG Communications Comments at 55; see also Edison Electric/UTC Comments at 29. But see Ameritech Comments at 15.  xOSection 224(e)(2) states that the costs of unusable space shall be allocated ". . . under an equal  S - x-apportionment of such costs among all attaching entities."C[ C yO-ԍ47 U.S.C.  224(e)(2). C We agree that each party that actually installs  xone or more wires in a duct or duct bank should be counted as a single attaching entity, regardless of the  x.number of cables installed or the amount of duct space occupied. The statutory preference for clarity is  x]preeminent and we perceive no generally applicable method that does not involve complexity and   confusion other than counting each entity within the conduit system as a separate attaching entity.     S-x` `  b.Unusable Space in a Conduit System      S- ` xk108.` ` Carolina Power, et al., assert that the only usable space is the duct itself, because the  Sx- x.surrounding structure and supportive infrastructure of the duct is the unusable space.\xh C {O -ԍCarolina Power, et al., Comments at 16; see also American Electric, et al., Comments at 53. To allocate the  x>cost of the unusable space, they argue that twothirds of the costs involved in constructing a conduit  S(- x.system should be apportioned among attaching entities.]( C yO#- xYԍThese costs typically include obtaining permits, excavating rock, shoring trench sides and treating subsurfaces. Carolina Power, et al., Reply at 6. These utility conduit owners reason that the  x.structure surrounding a conduit system exists to make other parts of the system usable in the same way"2R ],`(`(882 "  S-that unusable portions of a pole exist to make other parts of the pole usable.^C {Oh-ԍCarolina Power, et al., Comments at 16; see also American Electric, et al., Comments at 53.     S- ` `xl109.` ` USTA argues that although unusable conduit space differs from unusable pole space in  S- xLthe way it is created, it is possible to allocate the costs of unusable space.G_ZC {O-ԍSee USTA Comments at 45.G According to USTA, space  S- xin a conduit is unusable because it either is reserved for maintenance or has deteriorated.?`C yOL -ԍUSTA Comments at 45. ? The record  x?demonstrates that in some conduit systems not all of the ducts are used; one duct may simply be  Sp- xunoccupied or another may be reserved for maintenance.ap|C {O - xԍSee, e.g., Bell Atlantic Comments at 8; GTE Comments at 14; Carolina Power, et al., Reply at 6; Edison Electric/UTC Reply at 28. We conclude that if a maintenance duct is  xreserved for the benefit of all conduit occupants, such reservation renders that duct unusable and the costs  xlof that space should be allocated to those who benefit from it. To the degree space in a conduit is  xreserved for a maintenance or emergency circumstances, but not generally used, it should be considered   unusable space and its costs allocated appropriately as entities using the conduit benefit by the space.     S - ` pxm110.` ` Commenters representive of all industries suggest that no unusable space exists in a  S - xconduit system.b" C yO.- xYԍAmeritech Comments at 14; AT&T Comments at 16 (even ducts reserved for maintenance and/or emergency  xpurposes are used at times and therefore serve an ongoing purpose); Bell Atlantic Comments at 8; Comcast, et al.,  {O- xComments at 2223; Edison Electric/UTC Comments at 29. But see Carolina Power, et al., Comments at 16; ICG Communications Comments at 5354; USTA Comments at 45. We disagree. There appear to be two aspects to the unusable space within conduit  xsystems. First, there is that space involved in the construction of the system, without which there would  Sh - xkbe no usable space.}cXh C yO- xԍThis space would include the level down to which one must go in order to lay the system, much like one must  xygo up on a pole to reach the usable space there. The costs associated with creating this portion of space may generally include trenching, excavation, supporting structures, concrete, and backfilling.} Second, there is that space within the system which may be unusable after the  xsystem is constructed. We agree with Carolina Power, et al., that the costs for the construction of the  xsystem, which allow the creation of the usable space, should be part of the unusable space allocated among  S- xattaching entities.PdC yOp -ԍCarolina Power, et al., Reply at 610. P We also agree with USTA?epC yO"-ԍUSTA Comments at 45. ? to the extent that maintenance ducts reserved for the  S-benefit and use of all attaching entities should be considered unusable.ffC {Oh$-ԍAs we explained in the Pole Attachment Fee Notice at para 45:   jXx[i]f a utility reserves one duct for maintenance, and if the attacher has the right to utilize that reserved space   zin the event of a cable break or benefits in any way from the reservation of that space, that reserved duct   would be considered unusable space. In that event, it is necessary to include an 'adjustment for reserved"'e,`(`('"   ducts' element in the formula to reduce the average number of ducts in the denominator of the occupied   Nspace component of the formula. The adjustment for reserved ducts element would be the number of   Mreserved ducts that all attachers have the right to use in the event of a cable break or that they otherwise   receive benefit from in any other way. If the attacher has no right to use that space or receives no benefit from that duct, we propose that the denominator should not be reduced.(#f "3xf,`(`(88 "Ԍ S- ` Bԙxn111.` ` With regard to space in a conduit that is deteriorated, the record is less clear. If a duct  xhas deteriorated beyond usability, USTA believes it should be counted in the unusable space category and  S- xtherefore included in allocation of costs for unusable space to attachers.IgxC {O-ԍSee USTA Comments at 45. I We disagree. We are reluctant  x[to require that the costs of space that can not be used by, and provide no benefit to, an existing attaching  x>entity should be allocated beyond the utility conduit owner. In contrast, unusable space on a pole is  xMlargely attributed to safety and engineering concerns, adherence to which benefits the pole owner and  xattaching entities. Space in a conduit that has deteriorated serves no benefit to the existing ratepaying  xattaching entities. Deteriorated duct creates space that has been rendered unused by the utility. If such  x=space could, with reasonable effort and expense, be made available, the space is usable and not unusable.     S-x` `  c.HalfDuct Presumption for Determining Usable Conduit Space  S -x` `    S - ` xo112.` ` Certain telecommunications carriers support the proposed halfduct methodology for  S - xdetermining a conduit rate for usable space.h C yO2-ԍBell Atlantic Comments at 8; GTE Comments at 14; KMC Telecom Comments at 8; SBC Comments at 30. Bell Atlantic and GTE agree with the simplicity and  xLefficiency of our proposed formula, while SBC supports its applicability to telecommunications carriers  S8 - x?as well as cable operators because it is based on "actual figures and presumptions that attempt to  S- x approximate actual figures."RiC yOJ-ԍSBC Comments at 31 (emphasis in original).R GTE estimates that the average conduit consists of four ducts. GTE  xfurther indicates that consideration of the variations in duct diameter ". . . would unduly complicate the  S- xformula with even more nonpublic data, resulting in additional pole attachment disputes.";j* C yO-ԍGTE Comments at 14.; SBC states  x\that the halfduct methodology will adjust easily to telecommunications carriers that may use copper  Sp-facilities that occupy an entire duct.@kp C yO-ԍSBC Comments at 3031. @     S- ` xp113.` ` Other telecommunications carriers and some cable operators oppose the use of the half xLduct methodology asserting that it creates too large a presumption of usable space, resulting in rates that  S0- xcould result in an unreasonably high pole attachment rate.7lX0J C yO$- xԍAT&T Comments at 22, Reply at 1819 & 25; ICG Communications Comments at 55, Reply at 21,2425;  xNCTA Comments at 25; NCTA CS Docket 9798 Comments at 39; TCI CS Docket 9798 Comments at 16; Time Warner Cable CS Docket 9798 Comments at 28.7 Sprint, on the other hand, opposes the  xmethodology, indicating that due to the likelihood of damaging existing cables, it does not allow another"4jl,`(`(884 "  S- x[cable through a duct where there are no innerducts.mC yOh- x-ԍThe term "innerduct" generally refers to small diameter pipe or tubing placed inside conventional duct to allow the installation of multiple wires or cables. Sprint states that once an attacher uses an empty  S-duct, 100% of the space has been effectively used.Qn C yO-ԍSprint Comments in CS Docket 9798 at 11.Q     S- ` 'xq114.` ` Electric utilities oppose the halfduct methodology, stating that electric and  xcommunications cable cannot share the same duct due to practical and safety concerns as evidenced by  S- xjthe NESC.o"C {O - xԍSee American Electric, et al., Comments at 54; Duquesne Light Comments at 4952; Ohio Edison Comments  xat 4749; Union Electric Comments at 4146 (citing NESC Rule 341(A)(6) which states: Supply, control and  xcommunication cables shall not be installed in the same duct unless the cables are maintained or operated by the same utility).  Generally, the electric utilities state that safety considerations compel differences between  Sp- x=electric utility and other conduit systems.ppC yO-ԍAmerican Electric, et al., Comments at 55; Dayton Power Comments at 3; Edison Electric/UTC Reply at 26. American Electric, et al., indicate that underground conduit  SH- xis often used by the electric utilities solely to hold conductors that carry high voltage electric current.WqH* C yO-ԍAmerican Electric, et al., Comments at 5557. W  xFurther, they state that the difference between electric utility conduit systems and other conduit systems  xmakes it impossible to develop a uniform conduit formula that is equally applicable to electric and  S- xtelephone utility conduit systems.Rr C yO*-ԍAmerican Electric, et al., Comments at 55.R NCTA replies that utilities have not demonstrated that sharing of  S - xconduits between telecommunications carriers and electric utilities poses significant safety risks.9s J C yO-ԍNCTA Reply at 23.9 Some  xelectric utilities claim that they do not have the information necessary to apply the formula and that the  SX - x methodology is inappropriate for the pricing of access to electric utility conduit.ytX C yO-ԍAmerican Electric, et al., Comments at 5253; Edison Electric/UTC Comments at 28.y Specifically, the  xLelectric utilities claim that they cannot "readily determine the number of feet of conduit or the number of  S -ducts deployed or available in their system."eu jC yO-ԍAmerican Electric, et al., Comments in CS Docket 9798 at 83.e   x` `   S- ` xr115.` ` We adopt our proposed rebuttable presumption that a cable or telecommunications attacher  xoccupies a halfduct of space in order to determine a reasonable conduit attachment rate. We note that  xthe NESC rule relied on by the electric utilities does not prohibit the sharing of space between electric  xand communications. Rather, the rule conditions the sharing of such space on the maintenance and  Sx- xoperation being performed by the utility.vxC yO&- xZԍNESC Rule 341(A)(6) states that: "Supply, control, and communication cables shall not be installed in the same duct unless the cables are maintained or operated by the same utility." We continue to believe that the halfduct methodology is the"x5Rv,`(`(88 "  S- xZ"simplest and most reasonable approximation of the actual space occupied by an attacher."fwC {Oh-ԍPole Attachment Fee Notice, 12 FCC Rcd 7449 at para. 46.f This method,  S- x<patterned after the one used by the Massachusetts Department of Public Utilities ("MDPU"),xZC {O-ԍSee Greater Media, Inc. v. New England Telephone and Telegraph, Massachusetts D.P.U. 91218 (1992). allows for  xydetermining the cost per foot of one duct and then dividing by two instead of actually measuring the duct  xspace occupied. The MDPU finds, and we agree, that this method is reasonable because an attacher's use  xof a duct does not preclude the use of the other half of the duct so the attacher should not have to pay  xfor the entire duct. In situations where the formula is inappropriate because it has been demonstrated that  xthere are more than two users in the conduit or that one particular attachment occupies the entire duct, so  xas to preclude another from using the duct, our halfduct presumption can be rebutted. If a new entity  x?is installing an attachment in a previously unoccupied duct, we believe that such entity should be   encouraged to place innerduct prior to placing its wires in the duct.     S -x` `  d.Conduit Pole Attachment Formula     S - ` Bxs116.` ` We believe that a formula encompassing statutory directives of how utilities should be  xcompensated for the use of conduit adds certainty and clarity to negotiations as well as assists the  xCommission when it addresses complaints. We conclude that the addition of the conduit unusable and  S@- xconduit usable space factors, developed to implement Section 224(e)(2)yx@C yO- xԍFor allocating the cost of unusable space in a conduit for telecommunications carriers, see discussion at para. 104 above for the following basic formula: add 1f,,,,@@@@@@@@@!dd\     &H&   \\Conduit Unusable fSpace Factorv   c =v   yO$-  2 ă 3v  /Xv {8 NNet Linear Cost of  yO-DUnusable Conduit Space JkNumber of Attachers|H  AX|H   Carrying s Charge Rate \Hܞ and Section 224(e)(3),z@, C yO - xhԍFor allocating the cost of usable space in a conduit for telecommunications carriers, see discussion at para. 105 above for the following basic formula: add 1f,,,,@@@@@@@@@ !dddf,,,,@@@@@@@@@    . .  [WConduit ^~Usable `Space ^FactorL  =L   yO,- 1  2L  XL  yOd- 1 Duct  Average Number of Ducts, less Adjustments for maintenance ductsL  XL  Net Linear Cost of Usable Conduit Space L  XL Carrying Charge Rate d ܤ is  xconsistent with a just, reasonable, and nondiscriminatory pole attachment rate for telecommunications  S- xMcarriers in conduit.B{C yO#-ԍ47 U.S.C.  224(e)(1). B We adopt the following formula to be used to determine the maximum just and  xreasonable pole attachment rate for telecommunications carriers in a conduit system, effective February   8, 2001, encompasses the elements enumerated in the law:  S-Maximum Conduit hhConduithppConduit  S-Rate Per Net Linear Foot =Unusable Space Factor +ppUsable Space Factor"6{,`(`(88 "Ԍ S-ԙx D.` ` RightsofWay     S-x` ` 1. Background     S - ` xt117.` ` The amended Section 224(a)(4) of the Communication Act defines "pole attachment" to  xyinclude ". . . rightofway owned or controlled by a utility." The Commission has previously determined  x"that the access and reasonable rate provisions of Section 224 apply where a cable operator or  xtelecommunications carrier seeks to install facilities in a rightofway but does not intend to make a  S- xphysical attachment to any pole, duct or conduit.|C {O - xԍLocal Competition Order, 11 FCC Rcd at 16058107, paras. 11191240; 47 U.S.C. 224(a)(4); see also AT&T Comments at 18. For example, a utility must provide a requesting cable  xoperator or telecommunications carrier with "nondiscriminatory access" to any rightofway owned or  S0 - xcontrolled by the utility.D}0 "C yO -ԍ47 U.S.C. 224(f)(1). D An electric utility may deny a cable television system or any  xtelecommunications carrier access to its poles, ducts, conduits and rightsofway, on a non-discriminatory  xbasis, where there is "insufficient capacity and for reasons of safety, reliability and generally applicable  S -engineering purposes."~ C {O - xԍ47 U.S.C. 224(f)(2). These considerations were addressed as access issues in the Local Competition Order. 11 FCC Rcd at 16058107, paras. 11191240.     S - ` Cxu118.` ` The Commission's proceedings and cases generally have addressed issues involving  S- xjphysical attachments to poles, ducts, or conduits. The Notice sought information about the frequency at  Sz- xwhich rightsofway rate disputes might arise and the range of circumstances that would be involved.Vz C {O&-ԍNotice, 12 FCC Rcd at 11740, para. 42. V  xWe also asked whether we should adopt a methodology and/or formula to determine a just and reasonable  S*- xmrate, or whether rightsofway complaints should be addressed on a casebycase basis.G*C {Oh-ԍId. at 11740, para. 43. G If a  xzmethodology were recommended, the Commission requested comment on the elements, including any  xpresumptions, that could be used to calculate the costs relating to usable and unusable space in a rightof  way.     S- ` xv119.` ` Generally, cable and telecommunications carriers urge the Commission to establish a set  xof guiding principles against which rightsofway pole attachment complaints would be reviewed to  Sr- xminimize the number of disputes to be resolved through the complaint process.r0 C {OB#- x ԍSee AT&T Comments at 1718, Reply at 20; Bell Atlantic Reply at 27; MCI Reply at 2425; NCTA Comments  {O $-at 2728; But see Winstar Comments at 1112. Attaching entity  x>interests assert that, without some form of established methodology or formula, the parties to a pole  xattachment agreement would be without instruction and the attaching entity would be at the mercy of the""7 ,`(`(88^ "  S-rightofway owner.]C {Oh-ԍSee MCI Reply at 2425; Winstar Reply at 67. ]     S-x` ` 2. Discussion  S-  S - ` ~xw120.` ` The record indicates there have been few instances of attachment to a rightofway that  S- xdid not include attachment to a pole, duct or conduit.ZC {O- xԍSee, e.g., American Electric, et al. Comments at 65; Ameritech Comments at 1516; Carolina Power, et al., Comments at 16; GTE Comments at 1415; USTA Comments at 1415; US West Comments at 10. Comments of cable operators, telecommunications  xcarriers and utility pole owners confirm that there are too many different types of rightsofway, with  xdifferent kinds of restrictions placed on the various kinds of rightsofway, to develop a methodology that  x=would assist a utility and potential attacher in their efforts to arrive at just and reasonable compensation  SX- x=for the attachment.XC {O- xԍSee, e.g., American Electric, et al., Comments at 60; Ameritech Comments at 15; Carolina Power, et al., Comments at 1617. Such restrictions may also vary by state and local laws of real property, eminent  S0 -domain, utility, easements, and from underlying property owner to property owner.0 C {O-ԍSee, e.g., American Electric, et al., Comments at 60; Carolina Power, et al., Comments at 1617.     S@ - ` nxx121.` ` This Order, like the statute and the Local Competition Order, sets forth guiding principles  xto be used in determining what constitutes just, reasonable and nondiscriminatory rates for pole  xyattachments in rightsofway. The information submitted in this proceeding is not sufficient to enable us  x[to adopt detailed standards that would govern all rightofway situations. We thus believe it prudent for  xzthe Commission to gain experience through casebycase adjudication to determine whether additional  Sz- xN"guiding principles" or presumptions are necessary or appropriate.zC yO- xiԍOther rightsofway issues were raised in the comments but are outside the scope of this rulemaking are the  {O- xsubject of petitions of reconsideration, or involve litigation relating to the access provisions of Section 224. See Gulf  {OL- xPower Co. et al. v. United States, C.A. No. 3:96 CV 381 (N.D. Fla.) Until such time as the Commission resolves  xthe petitions for reconsideration, or a court issues a decision addressing Section 224's access provisions, the  xCommission's decisions continue to provide appropriate guidance to both utility pole owners and attaching entities for the purpose of negotiating pole attachments.  Therefore, we will address  x=complaints about just, reasonable, and nondiscriminatory pole attachments to a utility's rightofway on   a casebycase basis.     S:- V.xCOST ELEMENTS OF THE FORMULA FOR POLES AND CONDUIT     SJ- ` R xy122.` ` Section 224 ensures a utility pole owner just and reasonable compensation for pole  S"- xattachments made by telecommunications carriers.S"C yO%-ԍ47 U.S.C  224(b), (d)(1), (e)(1). S When Congress in 1978 directed the Commission  xyto regulate rates for pole attachments used for the provision of cable service, Congress established a zone"8,`(`(88 "  S- x[of reasonableness for such rates, bounded on the lower end by incremental costsC {Oh-ԍ1977 Senate Report at 19; see also Second Report and Order, 72 FCC 2d at 4. and on the upper end  S- x-by fully allocated costs.vZC {O-ԍSee 47 U.S.C.  224(d)(1); see also 1977 Senate Report at 19. v In the pole attachment context, incremental costs are those costs that the utility  S- xwould not have incurred "but for" the pole attachments in question.hC {O<-ԍ1977 Senate Report at 19; see also 72 FCC 2d at 62. h Fully allocated costs refer to the  xLportion of operating expenses and capital costs that a utility incurs in owning and maintaining poles that  S`- xare associated with the space occupied by pole attachments.J`~C {O~ -ԍ1977 Senate Report at 1920.J The Commission has noted that, in arriving  xyat an appropriate rate between these two boundaries, it is important to ensure that the attaching entity is  xnot charged twice for the same costs, once as up-front "makeready" costs and again for the same costs  xif they are placed in the corresponding pole line capital account that is used to determine the recurring   attachment rate.   x  S- ` xz123.` ` In regulating pole attachment rates, the Commission implemented a cost methodology  S - xpremised on historical or embedded costs.A C yOX-ԍ72 FCC 2d at 66, para. 15A These are costs that a firm has incurred in the past for  x providing a good or service and are recorded for accounting purposes as past operating expenses and  SX - xdepreciation. Many parties in this proceeding, as well as in the Pole Attachment Fee Notice proceeding,X C yO- xԍNCTA CS Docket No. 9798 Comments at 3, Reply at 1219; USTA CS Docket No. 9798 Reply at 56; U S West Comments at 2.  xadvocate extension of historical costs, while a number of parties advocate that the Commission adopt a  S - xforwardlooking economic costpricing ("FLEC") methodology for pole attachments. C {O- xԍSee American Electric, et al., Comments at 1118, CS Docket No. 9798 Comments at 1495; Edison Electric/UTC Comments at 8, Reply at 67. Forwardlooking  xcost methodologies seek to consider the costs that an entity would incur if it were to construct facilities   now to provide the good or service at issue.   x  S- ` Cx{124. ` ` We did not raise the issue of forward looking costs in the Notice in this proceeding.  x\While we do not prejudge the arguments raised by the commenters, we decline to address at this time  xproposals to shift to a forward looking cost methodology. Accordingly, we will continue the use of  x-historical costs in our pole attachment rate methodology, specifically as it is applied to telecommunications   carriers and cable operators providing telecommunications services.     S<- VI.xIMPLEMENTATION AND EFFECTIVE DATE OF RULES     SL-x|125.` ` Section 224(e)(4) states that:   "T9R ,`(`(88 "Ԍ ` Xx` ` [t]he regulations under paragraph (1) shall become effective 5 years after the date of   enactment of the Telecommunications Act of 1996. Any increase in the rates for pole attachments   that result from the adoption of the regulations required by this subsection shall be phased in equal  S-  annual increments over a period of 5 years beginning on the effective date of such regulations.AC yO-ԍ47 U.S.C.  224(e)(4).A    (#  xBecause the 1996 Act was enacted on February 8, 1996, Section 224(e)(4) requires the Commission to   implement the telecommunications carrier rate methodology beginning February 8, 2001.     SP- ` nx}126.` ` The Commission proposed that the amount of any rate increase should be phased in at the  S(- xbeginning of the five years, with onefifth of the total rate increase added each year. The Notice sought  xcomment on our proposed fiveyear phasein of the telecommunications carrier rate. It also sought  xcomment on any other proposals that would equitably phase in the telecommunications carrier rate within  S -the five years allotted by Section 224(e)(4).T XC {O-ԍNotice, 12 FCC Rcd at 11741, para. 44.T     S - ` 2  x~127.` ` Commenters request that the Commission clarify its phasein requirement by specifying  xwhen the first phasein increase is to begin or when the first annual increment should go into effect.  xUSTA notes an ambiguity regarding the Commissions proposal that the increment be added to the rate  SJ- x>in each of the subsequent five years.<JC yO-ԍUSTA Comments at 15.< USTA's concern is that the Commission's proposal gives the  ximpression that the phase in would not occur until after the first full year Section 224(e)(4) applies, or  xjFebruary 8, 2002. MCI requests that the Commission clarify that the fiveyear phasein pertains to any  xyrate increase resulting from the absorption of unusable costs by telecommunications carriers. It asks that  xthe Commission affirm that Congress intended only rate increases to be phased in and not rate changes  S- xor reductions.;zC yO-ԍMCI Comments at 23.; New York State Investor Owned Electric Utilities offer a plan to implement the phasein  xwhereby the billing rate would be calculated by applying 1/5, 2/5, 3/5, and 4/5 of the difference between  xthe current Section 224(d)(3) rate and the new Section 224(e) rate calculated each year and adding that  S -amount to the incremental Section 224(d)(3) rate.h  C yO-ԍNew York State Investor Owned Electric Utilities Comments at 27.h   x  S- ` nx128.` ` SBC further recommends that the Commission provide explicit procedures for this phase S- xin in order to avoid disputes over interpretation of Section 224(e)(4)s requirement.>C yO,#-ԍSBC Comments at 3536.> It recommends that  xthe amount of the increase be calculated based on the data available in the previous year, the year 2000,  xand that the amount of the increase not be recalculated during the five year phasein. SBC requests that  xja full share be added in 2001, even though the carrier rate is not effective until February 8, 2001, and that  xjafter the fifth year, for the year 2006, rates be calculated in accordance with the carrier formula, including   any changes in data through the end of the five year period. "*:* ,`(`(88 "Ԍ S- ` Qԙx129.` ` We conclude that the statutory language is explicit in requiring that any increase in the  x.rates for pole attachments shall be phasedin in equal annual increments over five years beginning on the  S- xyeffective date of such regulations.C {O- xԍSee Carolina Power, et al., Comments at 17; GTE Comments at 15; and Edison Electric/UTC Comments at 31. We clarify that the language beginning on the effective date of such  x=regulations refers to February 8, 2001, or five years after the enactment of the 1996 Act. We find New  xNYork State Investor Owned Electric Utilities' plan to implement the phasein consistent with the  xCommissions requirement that the increases be phasedin in equal increments over five years, with the  S-goal to have the entire amount of the increase implemented within five years of February 8, 2001.p"C yO - xԍFor example, if a telecommunications provider pays a Section 224(d)(3) rate on February 7, 2001 of $5.00  xper pole and application of the new formula pursuant to Section 224(e) produces a rate of $7.00 per pole, the  xdifference or increase of $2.00 per pole would be applied in five annual increments of $0.40 (or 20%) until the full amount of the increase is reached in the year 2005. The rate per pole for each year should be as follows:  yO -Beginning February 8, 2001hh$5.40  yO-Beginning February 8, 2002hh$5.80  yOJ-Beginning February 8, 2003hh$6.20  yO-Beginning February 8, 2004hh$6.60  yO-Beginning February 8, 2005hh$7.00p     S - ` x130.` ` We affirm that the fiveyear phasein is to apply to rate increases only and that the amount  xof the increase or the difference between the Section 224(d) rate and the 224(e) rate shall be applied  S- xannually until the full amount of the increase is absorbed within five years of February 8, 2001.C C {O*-ԍSee Conf. Rpt. at 99.C Rate   reductions are not subject to the phasein and are to be implemented immediately.        S - VII.xFINAL REGULATORY FLEXIBILITY ACT ANALYSIS  S -  S- ` Px131.` ` As required by the Regulatory Flexibility Act ("RFA"),{ZL C {O- xԍSee 5 U.S.C.  603. The RFA, see 5 U.S.C.  601 et. seq., has been amended by the Contract With America  xAdvancement Act of 1996, Pub. L. No. 104121, 110 Stat. 847 (1996) ("CWAAA"). Title II of the CWAAA is the Small Business Regulatory Enforcement Fairness Act of 1996 ("SBREFA").{ an Initial Regulatory Flexibility  S- xAnalysis ("IRFA") was incorporated in the Notice.nC {O!-ԍNotice of Proposed Rulemaking, CS Docket No. 97151, 12 FCC Rcd 11725, 1174151, paras. 4574 (1997). The Commission sought written public comment  S- xon the proposals in the Notice including comment on the IRFA. The comments received are discussed  S\-below. This present Final Regulatory Flexibility Analysis ("FRFA") conforms to the RFA.F\C {O$-ԍSee 5 U.S.C.  604. F     Sl-x` ` 1.  Need for, and Objectives of, the Order (# "l;,`(`(88d "Ԍ S- ԙ132.` ` Section 703 of the 1996 Act requires the Commission to prescribe regulations to govern  d(#Mthe charges for pole attachments used by telecommunications carriers to provide telecommunications  d(#services. The objectives of the rules adopted herein are, consistent with the 1996 Act, to promote  d(#competition and the expansion of telecommunications services and to reduce barriers to entry into the  d(#Ntelecommunications market by ensuring that charges for pole attachments are just, reasonable and   nondiscriminatory.     SH- z  ` ` 2.  Summary of Significant Issues Raised by Public Comments In Response to  S -the IRFA (#     S0 - 133.` ` No comments submitted in response to the Notice were specifically identified by the  S - d(#jcommenters as being in response to the IRFA contained in the Notice. Small Cable Business Association  S - d(#("SCBA") filed comments in response to the IRFA contained in the Pole Attachment Fee Notice, and, to  d(#Mthe extent they are relevant to the issues in this proceeding, we incorporate them herein by reference.  d(#zSCBA claims in its IRFA comments that, because of the statutory exclusion of cooperatives from the  Sn - d(#Mdefinition of utility, Section 224 does not minimize market entry barriers for small cable operators.Wn C yO-ԍSCBA IRFA Comments in CS Docket No. 9798 at 2.W  SF-According to SCBA, the IRFA in the Pole Attachment Fee Notice fails to consider this issue.1FXC {O>-ԍId.1     SX- z ` ` 3.  Description and Estimate of the Number of Small Entities To Which Rules  S0-Will Apply (#     S@-  134.` ` The RFA generally defines a "small entity" as having the same meaning as the terms  S- d(#k"small business," "small organization," and "small governmental jurisdiction."=C yO-ԍ5 U.S.C.  601(6).= In addition, the term  d(#"small business" has the same meaning as the term small business concern under the Small Business  S- d(#Act.ozC yO- d(#ԍ5 U.S.C.  601(3) (incorporating by reference the definitions of "small business concern" in 15 U.S.C.  632).  d(#kPursuant to 5 U.S.C.  601(3), the statutory definition of a small business applies "unless an agency, after  d(#-consultation with the Office of Advocacy of the Small Business Administration and after opportunity for public  d(#comment, establishes one or more `definitions' of such term which are appropriate to the activities of the agency and publishes such definitions in the Federal Register."o A "small business concern" is one that: (1) is independently owned and operated; (2) is not  d(#dominant in its field of operation; and (3) satisfies any additional criteria established by the Small Business  Sx- d(#Administration ("SBA").Ox* C yOB#-ԍSmall Business Act, 15 U.S.C.  632.O For many of the entities described below, the SBA has defined small business   categories through Standard Industrial Classification ("SIC") codes.     S`-` `  a.Utilities   "h< ,`(`(88 "Ԍ S-  135.` ` Many of the decisions and rules adopted herein may have a significant effect on a  d(#substantial number of utility companies. Section 224 defines a "utility" as "any person who is a local  d(#Lexchange carrier or an electric, gas, water, steam, or other public utility, and who owns or controls poles,  d(#ducts, conduits, or rightsofway used, in whole or in part, for any wire communications. Such term does  d(#not include any railroad, any person who is cooperatively organized, or any person owned by the Federal  d(#Government or any State." The SBA has provided the Commission with a list of utility firms which may  d(# be effected by this rulemaking. Based upon the SBA's list, the Commission concludes that all of the   following types of utility firms may be affected by the Commission's implementation of Section 224.     Q-` `  (1)hhCElectric Utilities (SIC 4911, 4931 & 4939)     S -  P136.` ` Electric Services (SIC 4911). The SBA has developed a definition for small electric utility  S - d(#firms. C yOJ - d(#ԍExecutive Office of the President, Office of Management and Budget, Standard Industrial Classification Manual (1987). The Census Bureau reports that a total of 1379 electric utilities were in operation for at least one  d(#=year at the end of 1992. According to SBA, a small electric utility is an entity whose gross revenues did  S - d(#not exceed five million dollars in 1992.? C yOR-ԍ13 C.F.R.  121.201.? The Census Bureau reports that 447 of the 1379 firms listed  Sj -had total revenues below five million dollars.j C yO- d(#ԍU.S. Department of Commerce, Bureau of the Census, 1992 Economic Census Industry and Enterprise Receipts Size Report, Table 2D (Bureau of Census data under contract to the Office of Advocacy of the SBA).     Sz-  137.` ` Electric and Other Services Combined (SIC 4931). The SBA has classified this entity as  ST- d(#ya utility whose business is less than 95% electric in combination with some other type of service.ATC {O-ԍSee supra note 416.A The  d(#LCensus Bureau reports that a total of 135 such firms were in operation for at least one year at the end of  d(#1992. The SBA's definition of a small electric and other services combined utility is a firm whose gross  S- d(#revenues did not exceed five million dollars in 1992.?C yO-ԍ13 C.F.R.  121.201.? The Census Bureau reported that 45 of the 135  S-firms listed had total revenues below five million dollars.A* C {O~-ԍSee supra note 418.A     S- 138.` ` Combination Utilities, Not Elsewhere Classified (SIC 4939). The SBA defines this utility  S- d(#as providing a combination of electric, gas, and other services which are not otherwise classified.A C {O#-ԍSee supra note 416.A The  d(#Census Bureau reports that a total of 79 such utilities were in operation for at least one year at the end  d(#of 1992. According to SBA's definition, a small combination utility is a firm whose gross revenues did"N=N ,`(`(88 "  S- d(#Lnot exceed five million dollars in 1992.?C yOh-ԍ13 C.F.R.  121.201.? The Census Bureau reported that 63 of the 79 firms listed had  S-total revenues below five million dollars.AXC {O-ԍSee supra note 418.A     Q-` `  (2) hhCGas Production and Distribution(#h  Q-` `  hhC(SIC 4922, 4923, 4924, 4925 & 4932)     S- 139.` ` Natural Gas Transmission (SIC 4922). The SBA's definition of a natural gas transmitter  S- d(#.is an entity that is engaged in the transmission and storage of natural gas.AC {Od -ԍSee supra note 416.A The Census Bureau reports  d(#kthat a total of 144 such firms were in operation for at least one year at the end of 1992. According to  d(#\SBA's definition, a small natural gas transmitter is an entity whose gross revenues did not exceed five  Sb - d(#jmillion dollars in 1992.?b |C yO~-ԍ13 C.F.R.  121.201.? The Census Bureau reported that 70 of the 144 firms listed had total revenues  S: -below five million dollars.A: C {O-ԍSee supra note 418.A     SJ - 140.` ` Natural Gas Transmission and Distribution (SIC 4923). The SBA has classified this entity  S$ - d(#as a utility that transmits and distributes natural gas for sale.A$ C {Ob-ԍSee supra note 416.A The Census Bureau reports that a total  d(#of 126 such entities were in operation for at least one year at the end of 1992. The SBA's definition of  d(#a small natural gas transmitter and distributer is a firm whose gross revenues did not exceed five million  S- d(# dollars.?0 C yO|-ԍ13 C.F.R.  121.201.? The Census Bureau reported that 43 of the 126 firms listed had total revenues below five  S-million dollars.A C {O-ԍSee supra note 418.A     S-  141.` ` Natural Gas Distribution (SIC 4924). The SBA defines a natural gas distributor as an  Sn- d(#entity that distributes natural gas for sale.AnR C {O`"-ԍSee supra note 416.A The Census Bureau reports that a total of 478 such firms  d(# were in operation for at least one year at the end of 1992. According to the SBA, a small natural gas  S- d(#distributor is an entity whose gross revenues did not exceed five million dollars in 1992.?C yO%-ԍ13 C.F.R.  121.201.? The Census">t,`(`(88S "  S-Bureau reported that 267 of the 478 firms listed had total revenues below five million dollars.AC {Oh-ԍSee supra note 418.A     S- ~142.` ` Mixed, Manufactured, or Liquefied Petroleum Gas Production and/or Distribution (SIC  S- d(#4925). The SBA has classified this entity as a utility that engages in the manufacturing and/or distribution  S- d(#.of the sale of gas. These mixtures may include natural gas.AZC {O-ԍSee supra note 416.A The Census Bureau reports that a total of  d(#=43 such firms were in operation for at least one year at the end of 1992. The SBA's definition of a small  d(#mixed, manufactured or liquefied petroleum gas producer or distributor is a firm whose gross revenues  SL- d(#.did not exceed five million dollars in 1992.?LC yO -ԍ13 C.F.R.  121.201.? The Census Bureau reported that 31 of the 43 firms listed  S$-had total revenues below five million dollars.A$|C {O@-ԍSee supra note 418.A     S4 -  o143.` ` Gas and Other Services Combined (SIC 4932). The SBA has classified this entity as a  S - d(#gas company whose business is less than 95% gas, in combination with other services.A C {O-ԍSee supra note 416.A The Census  d(#zBureau reports that a total of 43 such firms were in operation for at least one year at the end of 1992.  d(#[According to the SBA, a small gas and other services combined utility is a firm whose gross revenues did  S - d(#Lnot exceed five million dollars in 1992.? C yO-ԍ13 C.F.R.  121.201.? The Census Bureau reported that 24 of the 43 firms listed had  Sn -total revenues below five million dollars.An 0 C {O>-ԍSee supra note 418.A     Q~-` `  (3)hhCWater Supply (SIC 4941)     S-  Q144.` ` The SBA defines a water utility as a firm who distributes and sells water for domestic,  Sf- d(#=commercial and industrial use.Af C {O-ԍSee supra note 416.A The Census Bureau reports that a total of 3,169 water utilities were in  d(#operation for at least one year at the end of 1992. According to SBA's definition, a small water utility  S- d(#is a firm whose gross revenues did not exceed five million dollars in 1992.?T C yO #-ԍ13 C.F.R.  121.201.? The Census Bureau reported  S-that 3065 of the 3169 firms listed had total revenues below five million dollars.AC {Or%-ԍSee supra note 418.A     Q-` `  (4)hhCSanitary Systems (SIC 4952, 4953 & 4959) "?v,`(`(88Q "Ԍ    S-  n145.` ` Sewerage Systems (SIC 4952). The SBA defines a sewage firm as a utility whose business  S- d(#.is the collection and disposal of waste using sewage systems.AC {OJ-ԍSee supra note 416.A The Census Bureau reports that a total  d(#!of 410 such firms were in operation for at least one year at the end of 1992. According to SBA's  S- d(#definition, a small sewerage system is a firm whose gross revenues did not exceed five million dollars.?ZC yO-ԍ13 C.F.R.  121.201.?  d(#{The Census Bureau reported that 369 of the 410 firms listed had total revenues below five million  SB-dollars.ABC {O -ԍSee supra note 418.A     SR-  4146.` ` Refuse Systems (SIC 4953). The SBA defines a firm in the business of refuse as an  d(#Lestablishment whose business is the collection and disposal of refuse "by processing or destruction or in  d(#!the operation of incinerators, waste treatment plants, landfills, or other sites for disposal of such  S - d(#materials."A |C {O-ԍSee supra note 416.A The Census Bureau reports that a total of 2287 such firms were in operation for at least one  d(#year at the end of 1992. According to SBA's definition, a small refuse system is a firm whose gross  S - d(#revenues did not exceed six million dollars.? C yO:-ԍ13 C.F.R.  121.201.? The Census Bureau reported that 1908 of the 2287 firms  Sd -listed had total revenues below six million dollars.Ad C {O-ԍSee supra note 418.A     St- 147.` ` Sanitary Services, Not Elsewhere Classified (SIC 4959). The SBA defines these firms as  SN- d(#engaged in sanitary services.AN0 C {O-ԍSee supra note 416.A The Census Bureau reports that a total of 1214 such firms were in  d(#operation for at least one year at the end of 1992. According to SBA's definition, a small sanitary service  S- d(#Lfirms gross revenues did not exceed five million dollars.? C yO`-ԍ13 C.F.R.  121.201.? The Census Bureau reported that 1173 of the  S-1214 firms listed had total revenues below five million dollars.AR C {O -ԍSee supra note 418.A     Q-` `  (5)hhCSteam and Air Conditioning Supply (SIC 4961)     S-  148.` ` The SBA defines a steam and air conditioning supply utility as a firm who produces  S- d(#and/or sells steam and heated or cooled air.AC {OR'-ԍSee supra note 416.A The Census Bureau reports that a total of 55 such firms"@v,`(`(88 "  d(#were in operation for at least one year at the end of 1992. According to SBA's definition, a steam and  S- d(#=air conditioning supply utility is a firm whose gross revenues did not exceed nine million dollars.?C yO@-ԍ13 C.F.R.  121.201.? The  S-Census Bureau reported that 30 of the 55 firms listed had total revenues below nine million dollars.AXC {O-ԍSee supra note 418.A     Q-` `  (6)hhCIrrigation Systems (SIC 4971)     S- 149.` ` The SBA defines irrigation systems as firms who operate water supply systems for the  S- d(#purpose of irrigation.AC {O2 -ԍSee supra note 416.A The Census Bureau reports that a total of 297 firms were in operation for at least  d(#/one year at the end of 1992. According to SBA's definition, a small irrigation service is a firm whose  SX- d(#gross revenues did not exceed five million dollars.?X|C yOt-ԍ13 C.F.R.  121.201.? The Census Bureau reported that 286 of the 297  S0 -firms listed had total revenues below five million dollars.A0 C {O-ԍSee supra note 418.A     S@ -` `  b.Telephone Companies (SIC 4813)     SP -  150.` ` Many of the decisions and rules adopted herein may have a significant effect on a  d(#substantial number of small telephone companies. The SBA has defined a small business for SIC code  d(#4813 (Telephone Communications, except Radiotelephone) to be a small entity when it has no more than  S- d(#.1500 employees.?C yO-ԍ13 C.F.R.  121.201.? The Census Bureau reports that, at the end of 1992, there were 3497 firms engaged  S- d(#in providing telephone services, as defined therein, for at least one year.. C {O~- d(#]ԍUnited States Department of Commerce, Bureau of the Census, 1992 Census of Transportation,  {OH-Communications, and Utilities: Establishment and Firm Size, at Firm Size 1123 (1995) ("1992 Census").  This number contains a variety  d(#lof different categories of carriers, including local exchange carriers ("LECs"), interexchange carriers  d(#("IXCs"), competitive access providers ("CAPs"), cellular carriers, mobile service carriers, operator service  d(#providers, pay telephone operators, personal communications service ("PCS") providers, covered SMR  d(#.providers and resellers. Some of those 3497 telephone service firms may not qualify as small entities or  S- d(#small incumbent LECs because they are not "independently owned and operated."A C yO#-ԍ15 U.S.C.  632(a)(1).A We therefore  d(#conclude that fewer than 3497 telephone service firms are small entity telephone service firms or small  S- d(#.incumbent LECs that may be affected by this Order. Below, we estimate the potential number of small  d(#entity telephone service firms or small incumbent LEC's that may be affected by the rules adopted herein   in this service category.   "RA,`(`(88 "Ԍ Q-` `  (1)hhCWireline Carriers and Service Providers     S- 151.` ` The SBA has developed a definition of small entities for telephone communications  d(#Lcompanies other than radiotelephone (wireless) companies. The Census Bureau reports that, there were  S- d(#\2321 such telephone companies in operation for at least one year at the end of 1992.TC {O(-ԍ1992 Census, supra at Firm size 1123.T According to  d(#SBA's definition, a small business telephone company other than a radiotelephone company is one  Sp- d(#-employing no more than 1500 persons.?pZC yOj -ԍ13 C.F.R.  121.201.? Of the 2321 nonradiotelephone companies listed by the Census  d(#Bureau, 2295 were reported to have fewer than 1000 employees. Thus, at least 2295 nonradiotelephone  d(#.companies that might qualify as small entities or small incumbent LECs, or small entities based on these  d(#employment statistics. Although some of these carriers are likely not independently owned and operated,  d(#we are unable at this time to estimate with greater precision the number of wireline carriers and service  d(#providers that would qualify as small business concerns under SBA's definition. Consequently, we  d(#\estimate that there are fewer than 2295 small entity telephone communications companies other than  SX -radiotelephone companies that may be affected by the decisions or rules adopted in this Order.     Qj -` `  (2)hhCLocal Exchange Carriers     Sz- ~152.` ` Neither the Commission nor SBA has developed a definition of small providers of local  d(#exchange services. The closest applicable definition under SBA rules is for telephone communications  S*- d(#companies other than radiotelephone (wireless) companies (SIC 4813).1*C {O-ԍId.1 The most reliable source of  d(#information regarding the number of LECs nationwide appears to be the data that the Commission  S- d(#publishes annually in its Telecommunications Industry Revenue report, regarding the Telecommunications  S- d(#Relay Service ("TRS"). According to "TRS Worksheet" data released in November 1997, there are 1371  S- d(#kcompanies reporting that they categorize themselves as LECs.|C yO- d(#ԍFederal Communications Commission, Telecommunications Industry Revenue: TRS Fund Worksheet Data,  {Or-Figure 2 (Number of Carriers Paying Into the TRS Fund by Type of Carrier) (Nov. 1997) ("TRS Worksheet" data). Although some of these carriers are  d(#likely not independently owned and operated, or have more than 1500 employees, we are unable at this  d(#time to estimate with greater precision the number of LECs that would qualify as small business concerns  d(#under SBA's definition. Consequently, we estimate that there are fewer than 1371 small incumbent LECs   that may be affected by the rules adopted herein.     Q-` `  (3)hhCInterexchange Carriers     S- 153.` ` Neither the Commission nor SBA has developed a definition of small entities specifically  d(#applicable to providers of interexchange services. The closest applicable definition under SBA rules is  d(#for telephone communications companies other than radiotelephone (wireless) companies (SIC 4813). The  d(#most reliable source of information regarding the number of IXCs nationwide of which we are aware  d(#appears to be the data that we collect annually in connection with TRS. According to our most recent"nB,`(`(88 "  S- d(#data, 143 companies reported that they were engaged in the provision of interexchange services.<C {Oh-ԍTRS Worksheet.<  d(#Although some of these carriers are likely not independently owned and operated, or have more than 1500  d(#employees, we are unable at this time to estimate with greater precision the number of IXCs that would  d(#qualify as small business concerns under SBA's definition. Consequently, we estimate that there are fewer  S`-than 143 small entity IXCs that may be affected by the decisions and rules adopted in this Order.     Qr-` `  (4)hhCCompetitive Access Providers     S- 154.` ` Neither the Commission nor SBA has developed a definition of small entities specifically  d(#applicable to providers of competitive access services. The closest applicable definition under SBA rules  d(#=is for telephone communications companies other than radiotelephone (wireless) companies (SIC 4813).  d(#yThe most reliable source of information regarding the number of CAPs nationwide of which we are aware  S - d(#Lappears to be the data that we collect annually in connection with the TRS Worksheet. According to our  d(#=most recent data, 109 companies reported that they were engaged in the provision of competitive access  S - d(#services. ZC {O-ԍId. This TRS Worksheet category also includes Competitive Local Exchange Carriers ("CLECs"). Although some of these carriers are likely not independently owned and operated, or have  d(#more than 1500 employees, we are unable at this time to estimate with greater precision the number of  d(#jCAPs that would qualify as small business concerns under SBA's definition. Consequently, we estimate  d(#Lthat there are fewer than 109 small entity CAPs that may be affected by the decisions and rules adopted   herein.     Q-` `  (5)hhCCellular Service Carriers     S- 155.` ` Neither the Commission nor SBA has developed a definition of small entities specifically  d(#applicable to providers of cellular services. The closest applicable definition under SBA rules is for  d(#telephone communications companies other than radiotelephone (wireless) companies (SIC 4812). The  d(#most reliable source of information regarding the number of cellular service carriers nationwide of which  St- d(#ywe are aware appears to be the data that we collect annually in connection with the TRS Worksheet. The  SN- d(#TRS Worksheet places cellular licensees and Personal Communications Service ("PCS") licensees in one  d(#group. According to the most recent data, there are 804 carriers reporting that they categorize themselves  S- d(#as either PCS or cellular carriers.1C {O-ԍId.1 Although it seems certain that some of these carriers are not  d(#\independently owned and operated, or have more than 1500 employees, we are unable at this time to  d(#estimate with greater precision the number of cellular service carriers that would qualify as small business  d(#concerns under SBA's definition. Consequently, we estimate that there are fewer than 804 small entity  S`-cellular service carriers that may be affected by the decisions and rules adopted in this Order.     Qr-` `  (6)hhCMobile Service Carriers     S!- 156.` ` Neither the Commission nor SBA has developed a definition of small entities specifically"!C~,`(`(88" "  d(#applicable to mobile service carriers, such as paging companies. The closest applicable definition under  d(#SBA rules is for telephone communications companies other than radiotelephone (wireless) companies  d(#(SIC 4813). The most reliable source of information regarding the number of mobile service carriers  d(#=nationwide of which we are aware appears to be the data that we collect annually in connection with the  S`- d(#TRS Worksheet. According to our most recent data, 172 companies reported that they were engaged in  S:- d(#the provision of mobile services.1:C {O-ԍId.1 Although it seems certain that some of these carriers are not  d(#\independently owned and operated, or have more than 1500 employees, we are unable at this time to  d(#/estimate with greater precision the number of mobile service carriers that would qualify under SBA's  d(#definition. Consequently, we estimate that there are fewer than 172 small entity mobile service carriers  S-that may be affected by the decisions and rules adopted in this Order.   F$F   Q -` `  (7)hhCBroadband Personal Communications  Q -` `  hhCServices ("PCS") Licensees     S - 157.` ` The broadband PCS spectrum is divided into six frequency blocks designated A through  d(#[F, and the Commission has held auctions for each block. The Commission has defined "small entity" for  d(#jBlocks C and F as an entity that has average gross revenues of less than $40 million in the three previous  d(#calendar years. For Block F, an additional classification for "very small business" was added and is  d(#defined as an entity that, together with their affiliates, has average gross revenues of not more than $15  S- d(#=million for the preceding three calendar years.FZZC {O- d(#ԍSee Report and Order (Amendment of Parts 20 and 24 of the Commission's Rules Broadband PCS  d(#Competitive Bidding and the Commercial Mobile Radio Service Spectrum Cap), WT Docket No. 9659, FCC 96278 (1996) at para. 60, 61 FR 33859 (July 1, 1996).F These regulations defining "small entity" in the context  S- d(#zof broadband PCS auctions has been approved by the SBA.|C {O- d(#ԍSee Fifth Report and Order (Implementation of Section 309(j) of the Communications Act Competitive Bidding), PP Docket No.93253, 9 FCC Rcd 5532, 558184 (1994). No small businesses within the SBA d(#japproved definition bid successfully for licenses in Blocks A and B. There were 90 winning bidders that  d(#\qualified as small entities in the Block C auction. A total of 93 small and very small business bidders  S\- d(#won approximately 40% of the 1479 licenses for Blocks D, E, and F.\C {O-ԍFCC News, Broadband PCS, D, E and F Block Auction Closes, No. 71744 (released January 14, 1997). However, licenses for blocks C  d(#?through F have not been awarded fully, therefore there are few, if any, small businesses currently  d(#providing PCS services. Based on this information, we conclude that the number of broadband PCS  d(#\licensees will include the 90 winning C Block bidders and the 93 qualifying bidders in the D, E, and F  d(#blocks, for a total of 183 small PCS providers as defined by the SBA and the Commission's auction rules.  S- d(#=We note that the TRS Worksheet data track PCS licensees in the reporting category "Cellular or Personal  Sn- d(#=Communications Service Carrier." As noted supra in the paragraph regarding cellular carriers, according   to the most recent data, there are 804 carriers reporting that they place themselves in this category.     QX-` `  (8)hhCSpecialized Mobile Radio ("SMR") Licensees   "`Dh ,`(`(88 "Ԍ S- 158.` ` Pursuant to 47 C.F.R.  90.814(b)(1) and 90.912(b)(1), the Commission has defined  d(#>small entity in auctions for geographic area 800 MHz and 900 MHz SMR licenses as a firm that had  d(#average annual gross revenues of less than $15 million in the three previous calendar years. This  d(#zdefinition of a small entity in the context of 800 MHz and 900 MHz SMR has been approved by the  S`- d(#SBA.`C {O- d(#ԍSee Second Order on Reconsideration and Seventh Report and Order (Amendment of Parts 2 and 90 of the  d(#-Commission's Rules to Provide for the Use of 200 Channels Outside the Designated Filing Areas in the 896901  d(#,MHz and the 935940 MHz Bands Allotted to the Specialized Mobile Radio Pool), PR Docket No. 89583, 11 FCC  {O"- d(#Rcd 2639, 2693702 (1995); First Report and Order, Eighth Report and Order, and Second Further Notice of  {O- d(#wProposed Rulemaking (Amendment of Part 90 of the Commission's Rules to Facilitate Future Development of SMR Systems in the 800 MHz Frequency Band), PR Docket No. 93144, 11 FCC Rcd 1463 (1995). The rules adopted in this Order may apply to SMR providers in the 800 MHz and 900 MHz  d(#Lbands that either hold geographic area licenses or have obtained extended implementation authorizations.  d(#We do not know how many firms provide 800 MHz or 900 MHz geographic area SMR service pursuant  d(#to extended implementation authorizations, nor how many of these providers have annual revenues of less  d(#than $15 million. We assume, for purposes of this FRFA, that all of the extended implementation  d(#authorizations may be held by small entities which may be affected by the decisions and rules adopted  Sr- d(#in this Order. We note that the TRS Worksheet data track SMR licensees in the reporting category  d(#"Paging and Other Mobile Carriers." According to the most recent data, there are 172 carriers, including   SMR carriers, reporting that they place themselves in this category.     S4 - _159.` ` The Commission recently held auctions for geographic area licenses in the 900 MHz SMR  d(#band. There were 60 winning bidders that qualified as small entities in the 900 MHz auction. Based on  d(#this information, we conclude that the number of 900 MHz geographic area SMR licensees affected by  S- d(#the rules adopted in this Order includes these 60 small entities. The Commission also recently held  d(#>auctions for the 525 licenses for the upper 200 channels in the 800 MHz SMR band. There were 10  d(#winning bidders that qualified as small entities in that auction. Based on this information, we conclude  SF- d(#that the number of geographic area SMR licensees that may be affected by the rules adopted in this Order  d(#also includes these 10 small entities. However, the Commission has not yet determined how many  d(#licenses will be awarded for the lower 230 channels in the 800 MHz geographic area SMR auction. There  d(#is no basis, moreover, on which to estimate how many small entities will win these licenses. Given that  d(#[nearly all radiotelephone companies have fewer than 1000 employees and that no reliable estimate of the  d(#number of prospective 800 MHz licensees for the lower 230 channels can be made, we assume, for  d(#Lpurposes of this FRFA, that all of the licenses may be awarded to small entities that may be affected by  S0-the decisions and rules adopted in this Order.     QB-` `  (9)hhCResellers     SR- 160.` ` Neither the Commission nor SBA has developed a definition of small entities specifically  d(#applicable to resellers. The closest applicable definition under SBA rules is for all telephone  d(#communications companies (SIC 4812 and 4813). The most reliable source of information regarding the  d(#number of resellers nationwide of which we are aware appears to be the data that we collect annually in  S- d(#connection with the TRS Worksheet. According to our most recent data, 339 companies reported that they  S- d(#=were engaged in the resale of telephone services.<FC {Or'-ԍTRS Worksheet.< Although it seems certain that some of these carriers"E,`(`(88 "  d(#are not independently owned and operated, or have more than 1500 employees, we are unable at this time  d(#to estimate with greater precision the number of resellers that would qualify as small business concerns  d(#under SBA's definition. Consequently, we estimate that there are fewer than 339 small entity resellers  S-that may be affected by the decisions and rules adopted in this Order.     S-` `  c.Wireless (Radiotelephone) Carriers (SIC 4812)     S- ~161.` ` Although wireless carriers have not historically affixed their equipment to utility poles,  d(#pursuant to the terms of the 1996 Act, such entities are entitled to do so with rates consistent with the  d(#Commission's rules discussed herein. SBA has developed a definition of small entities for radiotelephone  d(#[(wireless) companies. The Census Bureau reports that there were 1176 such companies in operation for  S - d(#at least one year at the end of 1992.P C {Or -ԍSee 1992 Census supra at note 460.P According to SBA's definition, a small business radiotelephone  S - d(#company is one employing no more than 1500 persons.? ZC yO-ԍ13 C.F.R.  121.201.? The Census Bureau also reported that 1164 of  d(#those radiotelephone companies had fewer than 1000 employees. Thus, even if all of the remaining 12  d(#companies had more than 1500 employees, there would still be 1164 radiotelephone companies that might  d(#.qualify as small entities if they are independently owned and operated. Although some of these carriers  d(#are likely not independently owned and operated, we are unable at this time to estimate with greater  d(#precision the number of radiotelephone carriers and service providers that would qualify as small business  d(#Lconcerns under SBA's definition. Consequently, we estimate that there are fewer than 1164 small entity   radiotelephone companies that may be affected by the rules adopted herein.     S-` `  d.Cable System Operators (SIC 4841)     S-  Q162.` ` The SBA has developed a definition of small entities for cable and other pay television  S- d(#Lservices, which includes all such companies generating less than $11 million in revenue annually.?C yOL-ԍ13 C.F.R.  121.201.? This  d(#definition includes cable systems operators, closed circuit television services, direct broadcast satellite  d(#services, multipoint distribution systems, satellite master antenna systems and subscription television  d(#services. According to the Census Bureau, there were 1423 such cable and other pay television services  S"-generating less than $11 million in revenue.A"zC {O< -ԍSee supra note 416.A     S2- `163.` ` The Commission has developed its own definition of a small cable system operator for  d(#the purposes of rate regulation. Under the Commission's rules, a "small cable company," is one serving  S- d(#fewer than 400,000 subscribers nationwide.\ C yO%- d(#Zԍ47 C.F.R.  76.901(e). The Commission developed this definition based on its determinations that a small  {OV&- d(#icable system operator is one with annual revenues of $100 million or less. Sixth Report and Order and Eleventh  {O '- d(#Order on Reconsideration (Implementation of Sections of the 1992 Cable Act: Rate Regulation), 10 FCC Rcd 7393. " ',`(`(A'"  Based on our most recent information, we estimate that"FX,`(`(88 "  S- d(#there were 1439 cable systems that qualified as small cable system operators at the end of 1995.XC {O-ԍPaul Kagan Associates, Inc., Cable TV Investor, Feb. 29, 1996 (based on figures for Dec. 30, 1995). Since  d(#=then, some of those companies may have grown to serve over 400,000 subscribers, and others may have  d(#[been involved in transactions that caused them to be combined with other cable systems. Consequently,  d(#we estimate that there are fewer than 1439 small entity cable system operators that may be affected by  S`-the decisions and rules adopted in this Order.     Sr- 164.` ` The Communications Act also contains a definition of a small cable system operator,  d(#/which is "a cable operator that, directly or through an affiliate, serves in the aggregate fewer than one  d(#percent of all subscribers in the United States and is not affiliated with any entity or entities whose gross  S- d(#annual revenues in the aggregate exceed $250,000,000."AC yO -ԍ47 U.S.C. 543(m)(2).A The Commission has determined that there  d(#are 61,700,000 subscribers in the United States. Therefore, we found that an operator serving fewer than  d(#617,000 subscribers shall be deemed a small operator, if its annual revenues, when combined with the total  S - d(#annual revenues of all of its affiliates, do not exceed $250 million in the aggregate.B zC yO-ԍ47 C.F.R.  76.1403(b).B Based on available  d(#data, we find that the number of cable systems serving 617,000 subscribers or less totals 1450. Although  d(#Lit seems certain that some of these cable system operators are affiliated with entities whose gross annual  d(#revenues exceed $250,000,000, we are unable at this time to estimate with greater precision the number  d(#of cable system operators that would qualify as small cable systems under the definition in the   Communications Act.     S-` ` e.Municipalities     S- 3165.` ` The term "small governmental jurisdiction" is defined as "governments of . . . districts,  S- d(#with a population of less than 50,000."= C yO\-ԍ5 U.S.C.  601(5).= There are 85,006 governmental entities in the United States.C {O-ԍUnited States Dept. of Commerce, Bureau of the Census, 1992 Census of Governments.  d(#This number includes such entities as states, counties, cities, utility districts and school districts. We note  d(#jthat Section 224 specifically excludes any utility which is cooperatively organized, or any person owned  d(#.by the Federal Government or any State. For this reason, we believe that Section 224 will have minimal  d(#\if any affect upon small municipalities. Further, there are 18 states and the District of Columbia that  d(#regulate pole attachments pursuant to Section 224(c)(1). Of the 85,006 governmental entities, 38,978 are  d(#counties, cities and towns. The remainder are primarily utility districts, school districts, and states. Of   the 38,978 counties, cities and towns, 37,566 or 96%, have populations of fewer than 50,000.  S-  S-  D.` ` Description of Projected Reporting, Recordkeeping, and Other Compliance  S-Requirements (#` "G, ,`(`(88 "Ԍ S- ԙ166.` ` The rules adopted in this Order will require a change in certain recordkeeping  d(#requirements. A utility pole owner will now have to maintain specific records relating to the number of  d(#attachers for purposes of determining and updating its presumptive average number of attachers for  d(#computing the unusable space calculation for the telecommunications carrier rate formula. The utility pole  d(#owner may also require the services of an accountant to determine the new telecommunications rate. In  d(#addition, our rules adopted herein will require cable operators to notify the pole owner(s) if and when the  S- d(#cable operator begins providing telecommunications services. We sought comment in the Notice on  d(#whether small entities may be required to hire additional staff and expend additional time and money to  S- d(#comply with the proposals set forth in the Notice. In addition, we sought comment as to whether there  d(#will be a disproportionate burden placed on small entities in complying with the proposals set forth in this  Sv-Order.     S -  167.` ` We did not receive any comments asserting that small entities will be required to hire  d(#additional staff and expend additional time and money to determine the appropriate rate for  d(#ytelecommunications carriers under our new rules. SCBA was the only commenter to claim that there will  d(#>be a disproportionate burden placed on small entities. SCBA claims that small cable systems will be  d(#.particularly hurt by the statutory exemption of cooperatives from the definition of utility because small  d(#cable systems often operate in rural areas and therefore necessarily attach their plant to rural telephone  S- d(#and electric cooperatives.WC yO-ԍSBCA IRFA Comments in CS Docket No. 9798 at 2.W We note that SBCA does not appear to be claiming that our rules will  d(#disproportionately burden small cable systems, but that where our rules do not apply, small cable system  d(#operators will be disproportionately harmed. Because the exemption for cooperatives was set forth by  d(#Congress clearly in Section 224(a)(1), the Commission is unable to address SBCA's concerns in this   regard. We conclude that our rules will not disproportionately burden small entities.     S- / E.` ` Steps Taken to Minimize Significant Economic Impact on Small Entities, and   Significant Alternatives Considered(#`     S-  168.` ` The 1996 Act requires the Commission to adopt a telecommunications carrier methodology  S- d(#within two years of the enactment of the 1996 Act.CXC {O-ԍSee Section VI above.C We sought comment in the Notice on various  d(#Malternative ways of implementing the statutory requirements and any other potential impact of these  d(#proposals on small business entities. We sought comment on the implementation of a methodology to  d(#=ensure just, reasonable and nondiscriminatory pole attachment and conduit rates for telecommunications  d(#carriers. We also sought comment on how to develop a rightsofway rate methodology for   telecommunications carriers.     S- 169.` ` In accordance with the RFA, the Commission has endeavored to minimize significant  d(#[impact on small entities. With regard to our pole attachments complaint process, we rejected a proposal  d(#that we establish an amount in controversy as a minimum threshold for filing a complaint because, among  d(#^other things, it might preclude small entities from obtaining relief from unjust, unreasonable or"!H,`(`(88" "  S- d(#discriminatory pole attachment rates.FC {Oh-ԍSee Section III.B above.F We also rejected as too burdensome the suggestion that cable  S- d(#operators be required to certify annually as to whether they are providing telecommunications services.GZC {O-ԍSee Section IV.A.2 above.G  d(#To minimize the burden on utility pole owners, including those that qualify as small entities, and to  d(#ypromote certainty and efficiency in determining the pole attachment rate for telecommunications carriers,  S`- d(#we have maintained our formula presumptions, including our onefoot presumption of usable space.S`C {O-ԍSee Sections IV.A.1 and IV.A.5 above.S  d(#We also determined that, as an alternative to requiring utility pole owners to conduct potentially expensive  d(#polebypole inventories for the number of attachers on each pole, we would require pole owners to  d(#[develop, through information it possesses, a presumptive average number of attachers, based on location  S-(i.e., urban, rural and urbanized).J~C {O -ԍSee Section IV.A.4.d. above.J     S-  170.` ` Report to Congress: The Commission will send a copy of the Order, including this  d(#FRFA, in a report to be sent to Congress pursuant to the Small Business Regulatory Enforcement Fairness  S - d(#Act of 1996, see 5 U.S.C.  801(a)(1)(A). A copy of the Order and this FRFA (or summary thereof) will  S\ - d(#\also be published in  the Federal Register, see 5 U.S.C. 604(b), and will be sent to the Chief Counsel  S6 -for Advocacy of the Small Business Administration.         SN- VIII.PAPERWORK REDUCTION ACT OF 1995 ANALYSIS     S^- 171.` ` The requirements adopted in this Order have been analyzed with respect to the Paperwork  d(#Reduction Act of 1995 (the "1995 Act") and found to impose modified information collection requirements  d(#on the public. The Commission, as part of its continuing effort to reduce paperwork burdens, invites the  d(#[general public to take this opportunity to comment on the information collection requirements contained  S- d(#in this Order, as required by the 1995 Act. Public comments are due 60 days from date of publication  S- d(#yof this Order in the Federal Register. Comments should address: (1) whether the proposed collection of  d(#-information is necessary for the proper performance of the functions of the Commission, including whether  d(#the information shall have practical utility; (2) the accuracy of the Commission's burden estimates; (3)  d(#ways to enhance the quality, utility, and clarity of the information collected; and (4) ways to minimize  d(#=the burden of the collection of information on the respondents, including the use of automated collection   techniques or other forms of information technology.  S-  S- 172.` ` As stated above, written comments by the public on the modified information collection  S- d(#requirements are due 60 days from date of publication of this Order in the Federal Register. Comments  d(#on the information collections contained herein should be submitted to Judy Boley, Federal  d(#Communications Commission, Room 234, 1919 M Street, NW, Washington, DC 20554, or via the  d(#Internet to jboley@fcc.gov. For additional information on the information collection requirements, contact   Judy Boley at 2024180214 or via the Internet at the above address." I,`(`(88u! "Ԍ  ԙ  S- IX.ORDERING CLAUSES     S-  173.` ` IT IS ORDERED that, pursuant to Sections 1, 4(i) and 224 of the Communications Act  d(#of 1934, as amended, 47 U.S.C.  151, 154(i) and 224, the Commission's rules are hereby amended as   set forth in Appendix A.     S- 174.` ` IT IS FURTHER ORDERED that Section 1.1402 of the Commission's rules, as amended  S- d(#in Appendix A hereto, will become effective 30 days after the date of publication of this Report and  S- d(#lOrder in the Federal Register, and that Sections 1.1403, 1.1404, 1.1409, 1.1417 and 1.1418 of the  d(#Commission's rules, as amended in Appendix A hereto, will become effective 140 days after the date of  S< - d(#publication of this Report and Order in the Federal Register, unless the Commission publishes a notice  d(#before that date stating that the Office of Management and Budget ("OMB") has not approved the   information collection requirements contained in the rules.     S - 175.` ` IT IS FURTHER ORDERED that the Commission's Office of Public Affairs, Reference  S- d(#kOperations Division, SHALL SEND a copy of this Report and Order, including the Final Regulatory   Flexibility Analyses, to the Chief Counsel for Advocacy of the Small Business Administration.            ` ` hhCFEDERAL COMMUNICATIONS COMMISSION         ` `  hhC   ` `  hhCMagalie Roman Salas   ` `  hhCSecretary   "J,`(`(88 "  S- K ` APPENDIX Aă      ]Revised Rules     S - Part 1 of title 47 of the Code of Federal Regulations is amended as follows:      PART 1 PRACTICE AND PROCEDURE     S@-1.` ` The authority citation for Part 1 continues to read as follows:     SP -AUTHORITY: 47 U.S.C. 151, 154, 303, and 309(j) unless otherwise noted.  )     S` - `2.` ` Section 1.1402 is amended by revising paragraph (c) and by adding new paragraphs (i),   (j), (k), (l) and (m) to read as follows:     SH-Sec. 1.1402` ` Definitions.      * * * * *     v (c) With respect to poles, the term usable space means the space on a utility pole above the  d(#minimum grade level which can be used for the attachment of wires, cables, and associated equipment.  d(#With respect to conduit, the term usable space means space within a conduit system which is available,  d(#or which could, with reasonable effort and expense, be made available, for the purpose of installing wires,   cable and associated equipment for telecommunications services.      * * * * *     v (i) The term conduit means a pipe placed in the ground in which cables and/or wires may be   installed.     v (j) The term conduit system means structures that provide physical protection for cable and/or   wires that allow new cables to be added along a route.     S - (k) The term duct means a single enclosed raceway for conductors, cable and/or wire.     v (l) With respect to poles, the term unusable space means the space on a utility pole below the  d(#usable space, including the amount required to set the depth of the pole. With respect to conduit, the term  d(#unusable space means space involved in the construction of a conduit system, without which there would   be no usable space, and maintenance ducts reserved for the benefit of all conduit users.  SX&-  v (m) The term attaching entity includes cable operators, telecommunications carriers, incumbent   local exchange carriers, utilities and governmental entities providing cable or telecommunications services."8(K,**88O) "Ԍ S-  ԙ3.` ` Section 1.1403 is amended by retitling the section and by adding new paragraph (e) to   read as follows:     S- %Sec. 1.1403` ` Duty to provide access; modifications; notice of removal, increase or modification;   petition for temporary stay; and cable operator notice.(#`      * * * * *      (e) Cable operators must notify pole owners upon offering telecommunications services.     S -  o4.` ` Section 1.1404 is amended to add a new subsection (g)(12) and new paragraphs (h), (i),  d(#\and (j) to read as follows, and to redesignate old paragraphs (g)(12), (h), (i), (j) and (k) as (g)(13), (k),   (l), (m) and (n), respectively:     S -Sec. 1.1404` ` Complaint.      * * * * *      (g) * * * * *     S- v  (12) The average amount of unusable space per pole for those poles used for pole attachments  d(#(a 24 foot presumption may be used in lieu of actual measurement, but the presumption may be rebutted);   and      * * * * *     v (h) With respect to attachments within a duct or conduit system, where it is claimed that either  d(#.a rate is unjust or unreasonable, or a term or condition is unjust or unreasonable and examination of such  d(#jterm or condition requires review of the associated rate, the complaint shall provide data and information  d(#in support of said claim. The data and information shall include, where applicable, equivalent information   as specified in paragraph (g) of this section.     v (i) With respect to rightsofway, where it is claimed that either a rate is unjust or unreasonable,  d(#or a term or condition is unjust or unreasonable and examination of such term or condition requires review  d(#of the associated rate, the complaint shall provide data and information in support of said claim. The data  d(#and information shall include, where applicable, equivalent information as specified in paragraph (g) of   this section.     v (j) If any of the information and data required in paragraphs (g), (h) and (i) of this section is not  d(#zprovided to the cable television operator or telecommunications carrier by the utility upon reasonable  d(#request, the cable television operator or telecommunications carrier shall include a statement indicating  d(#the steps taken to obtain the information from the utility, including the dates of all requests. No complaint"'L,`(`(88A( "  d(#Lfiled by a cable television operator or telecommunications carrier shall be dismissed where the utility has  d(#failed to provide the information required under paragraphs (g), (h) or (i) of this section, as applicable,  d(#after such reasonable request. A utility must supply a cable television operator or telecommunications  d(#carrier the information required in paragraph (g), (h) or (i) of this section, as applicable, along with the  d(#.supporting pages from its FERC Form 1, FCC Form M, or other report to a regulatory body, within 30  d(#days of the request by the cable television operator or telecommunications carrier. The cable television  d(#operator or telecommunications carrier, in turn, shall submit these pages with its complaint. If the utility  d(#did not supply these pages to the cable television operator or telecommunications carrier in response to   the information request, the utility shall supply this information in its response to the complaint.     S-  B5.` ` Section 1.1409 is amended by revising paragraph (e) and adding a new paragraph (f) to   read as follows:     S -Sec. 1.1409` ` Commission consideration of the complaint.      * * * * *     v (e) When parties fail to resolve a dispute regarding charges for pole attachments and the  d(#Commission's complaint procedures under Section 1.1404 are invoked, the Commission will apply the   following formulas for determining a maximum just and reasonable rate:     v (1) The following formula shall apply to attachments by cable operators providing cable services.  d(#This formula shall also apply to attachments by any telecommunications carrier (to the extent such carrier  d(#is not a party to a pole attachment agreement) or cable operator providing telecommunications services   until February 8, 2001:     S0- !d(#PMaximum Rate = Space Occupied by Attachment  X Net Cost of X Carrying  S-` `  Total Usable Spaceqpp Bare Pole Charge Rate     v (2) Subject to subsection (f) the following formula shall apply to pole attachments on a pole by  d(#.any telecommunications carrier (to the extent such carrier is not a party to a pole attachment agreement)   or cable operator providing telecommunications services beginning on February 8, 2001:      Maximum Pole Rate = Unusable Space Factor + Usable Space Factor     d(#For purposes of this formula, the unusable space factor, as defined under Section 1.1417(b), and the usable   space factor, as defined under Section 1.1418(b), shall apply per pole.      "#M,`(`(88$ "  v (3) Subject to subsection (f) the following formula shall apply to pole attachments within a   conduit system beginning on February 8, 2001:     S-Maximum` `  ConduithhCqppConduit  S-Conduit Rate = Unusable Space Factorq+Usable Space Factor     d(#=For purposes of this formula, the conduit unusable space factor, as defined under Section 1.1417(c), and  d(#lthe conduit usable space factor, as defined under Section 1.1418(c), shall apply to each linear foot   occupied.     v ?(f) Subsections (e)(2) and (e)(3) of this section shall become effective February 8, 2001 (i.e., five  d(#yyears after the effective date of the Telecommunications Act of 1996). Any increase in the rates for pole  d(#attachments that result from the adoption of such regulations shall be phased in over a period of five years  d(#kbeginning on the effective date of such regulations in equal annual increments. The fiveyear phasein  d(#is to apply to rate increases only. Rate reductions are to be implemented immediately. The determination  d(#>of any rate increase shall be based on data currently available at the time of the calculation of the rate   increase.     S-6.` ` Section 1.1417 is added to read as follows:     S-Sec. 1.1417` ` Allocation of Unusable Space Costs.     v 1(a) A utility shall apportion the cost of providing unusable space on a pole, duct, conduit, or  d(#jrightofway so that such apportionment equals twothirds of the costs of providing unusable space that   would be allocated to such entity under an equal apportionment of such costs among all entities.     v }(b) With respect to poles, the following formula shall be used to establish the allocation of  d(#unusable space costs on a pole for telecommunications carriers and cable operators providing   telecommunications services:     S-Pole Unusable = 2 X Unusable Space X Net Cost of Bare Pole X Carrying  S-Space Factor` `  3 Pole Heightq  F$F0   F$F0 Number of Attachers Charge Rate     d(#All attaching entities shall be counted as separate attaching entities for purposes of apportioning the costs   of unusable space.   "x!N,`(`(88t" "     v (c) With respect to conduit, the following formula shall be used to establish the allocation of  d(#unusable space costs for telecommunications carriers and cable operators providing telecommunications   services within a conduit:     S-X` hp x (#%'0*,.8135@8: