(2) The sole owner of an unincorporated business who has a net worth of not more than $5 million, including both personal and business interests, and not more than 500 employees;

(3) A charitable association as defined in section 501(c)(3) of the Internal Revenue Code (26 U.S.C. 501(c)(3)) with not more than 500 employees;

(4) A cooperative association as defined in section 15(a) of the Agricultural Marketing Act (12 U.S.C. 1141j(a)) with not more than 500 employees;

(5) Any other partnership, corporation, association, or public or private organization with a net worth of not more than $5 million and not more than 500 employees.

(c) For the purpose of eligibility, the net worth and number of employees of an applicant shall be determined as of the date the proceeding was designated.

(d) An applicant who owns an unincorporated business will be considered as an "individual" rather than a "sole owner of an unincorporated business" if the issues on which the applicant prevails are related primarily to personal interests rather than to business interests.

(e) The number of employees of an applicant include all persons who regularly perform services for remuneration for the applicant, under the applicant's direction and control. Parttime employees shall be included on a proportional basis.

(f) The net worth and number of employees of the applicant and all of its affiliates shall be aggregated to determine eligibility. Any individual, corporation or other entity that directly or indirectly controls or owns a majority of the voting shares or other interest, will be considered an affiliate for purposes of this part, unless the Administrative Law Judge determines that such treatment would be unjust and contrary to the purposes of the EAJA in light of the actual relationship between the affiliated entities. In addition, the Administrative Law Judge may determine that financial relationships of the applicant other than those described in this paragraph constitute special circumstances that would make an award unjust.

(g) An applicant that participates in a proceeding primarily on behalf of one or more other persons or entities that would be ineligible is not itself eligible for an award.

§ 1.1505 Standards for awards.

(a) An eligible prevailing applicant shall receive an award for fees and expenses incurred in connection with a proceeding, or in a significant and discrete substantive portion of the proceeding, unless the position of the Commission over which the applicant has prevailed was substantially justified. The burden of proof that an award should not be made to an eligible prevailing applicant is on the appropriate Bureau (see § 1.21 of this chapter) whose representative shall be called “Bureau counsel" in this subpart. The Bureau may avoid an award by showing that its position was reasonable in law and fact. (b) An award will be reduced or denied if the applicant has unduly or unreasonably protracted the proceeding or if special circumstances make the award sought unjust.

§ 1.1506 Allowable fees and expenses.

(a) Awards will be based on rates customarily charged by persons engaged in the business of acting as attorneys, agents and expert witnesses.

(b) No award for the fee of an attorney or agent under these rules may exceed $75.00 per hour. No award to compensate an expert witness may exceed the highest rate at which the

Commission pays expert witnesses. However, an award may also include the reasonable expenses of the attorney; agent, or witness as a separate item, if the attorney, agent or witness ordinarily charges its clients separately for such expenses. (c) In determining the reasonableness of the fee sought for an attorney, agent or expert witness, the Administrative Law Judge shall consider the following:

(1) If the attorney, agent or witness is in private practice, his or her customary fee for similar services, or, if an employee of the applicant, the fully allocated cost of the services;

(2) The prevailing rate for similar services in the community in which the attorney, agent or witness ordinarily performs services;

(3) The time actually spent in the representation of the applicant;

(4) The time reasonably spent in light of the difficulty or complexity of the issues in the proceeding; and

(5) Such other factors as may bear on the value of the service provided.

(d) The reasonable cost of any study, analysis, engineering report, test, project or similar matter prepared on behalf of a party may be awarded, to the extent that the charge for the service does not exceed the prevailing rate for similar services, and the study or other matter was necessary for preparation of the applicant's case.

(e) Fees may be awarded only for work performed after designation of a proceeding or after issuance of a show cause order.

§ 1.1507 Rulemaking on maximum rates for attorney fees. (a) If warranted by an increase in the cost of living or by special circumstances (such as limited availability of attorney's qualified to handle certain types of proceedings), the Commission may adopt regulations providing that attorney fees may be awarded at a rate higher than $75 per hour in some or all of the types of proceedings covered by this part. The Commission will conduct any rulemaking proceedings for this purpose under the informal rulemaking procedures of the Administrative Procedure Act.

(b) Any person may file with the Commission a petition for rulemaking to increase the maximum rate for attorney fees, in accordance with Subpart C of this chapter. The petition should identify the rate the petitioner believes this agency should establish and the types of proceedings in which the rate should be used. It should also explain fully the reasons why the higher rate is warranted. This agency will respond to the petition by initiating a rulemaking proceeding, denying the petition, or taking other appropriate action.

§ 1.1508 Awards against other agencies.

If an applicant is entitled to an award because it prevails over another agency of the United States that participates in a proceeding before the Commission and takes a position that is not substantially justified, the award for an appropriate portion of the award shall be made against that agency. Counsel for that agency shall be treated as Bureau counsel for the purpose of this subpart.

INFORMATION REQUIRED FROM APPLICANTS

§ 1.1511 Contents of application.

(a) An application for an award of fees and expenses under EAJA shall identify the applicant and the proceeding for

which an award is sought. The application shall show that the applicant has prevailed and identify the position of an agency or agencies in the proceeding that the applicant alleges was not substantially justified. Unless the applicant is an individual, the application shall also state the number of employees of the applicant and describe briefly the type and purpose of its organization or business.

(b) The application shall also include a statement that the applicant's net worth does not exceed $1 million (if an individual) or $5 million (for all other applicants, including their affiliates). However, an applicant may omit this statement if: (1) It attaches a copy of a ruling by the Internal Revenue Service that it qualifies as an organization described in section 501(c)(3) of the Internal Revenue Code (26 U.S.C. 501(c)(3)) or, in the case of a tax-exempt organization not required to obtain a ruling from the Internal Revenue Service on its exempt status, a statement that describes the basis for the applicant's belief that it qualifies under such section; or

(2) It states that it is a cooperative association as defined in section 15(a) of the Agricultural Marketing Act (12 U.S.C. 1141j(a)).

(c) The application shall state the amount of fees and expenses for which an award is sought.

(d) The application may also include any other matters that the applicant wishes the Commission to consider in determining whether and in what amount an award should be made.

(e) The application shall be signed by the applicant or an authorized officer or attorney of the applicant. It shall also contain or be accompanied by a written verification under oath or under penalty of perjury that the information provided in the application is true and correct.

§ 1.1512 Net worth exhibit.

(a) Each applicant except a qualified tax-exempt organization or cooperative association must provide with its application a detailed exhibit showing the net worth of the applicant and any affiliates (as defined in § 1.1504(f) of this part) at the time the proceeding was designated. The exhibit may be in any form convenient to the applicant that provides full disclosure of the applicant's and its affiliates' assets and liabilities and is sufficient to determine whether the applicant qualifies under the standards in this subpart. The Administrative Law Judge may require an applicant to file additional information to determine its eligibility for an award.

(b) Ordinarily, the net worth exhibit will be included in the public record of the proceeding. However, an applicant that objects to public disclosure of information in any portion of the exhibit and believes there are legal grounds for withholding it from disclosure may submit that portion of the exhibit directly to the Administrative Law Judge in a sealed enevelope labeled "Confidential Financial Information”, accompanied by a motion to withhold the information from public disclosure. The motion shall describe the information sought to be withheld and explain, in detail, why it falls within one or more of the specific exemptions from mandatory disclosure under the Freedom of Information Act, 5 U.S.C. 552(b)(1)-(9), why public disclosue of the information would adversely affect the applicant, and why disclosure is not required in the public interest. The material in question shall be served on Bureau counsel, but need not be served on any other party to the proceeding. If the Administrative Law Judge finds that the information should not be withheld from disclosure, it shall be placed in the public record of the proceeding. Otherwise, any request to inspect or copy the exhibit

shall be disposed of in accordance with the Commission's established procedures under the Freedom of Information Act, § 0.441 through 0.466 of this chapter.

§1.1513 Documentation of fees and expenses.

The application shall be accompanied by full documentation of the fees and expenses, including the cost of any study, analysis, engineering report, test, project or similar matter, for which and award is sought. A separate itemized statement shall be submitted for each professional firm or individual whose services are covered by the application, showing hours spent in connection with the proceeding by each individual, a description of this specific services performed, the rate at which each fee has been computed, any expenses for which reimbursement is sought, the total amount claimed, and the total amount paid or payable by the applicant or by any other person or entity for the services provided. The Administrative Law Judge may require the applicant to provide vouchers, receipts, or other substantiation for any expenses claimed.

§ 1.1514 When an application may be filed.

(a) An application may be filed whenever the applicant has prevailed in the proceeding or in a significant and discrete substantive portion of the proceeding, but in no case later than 30 days after the Commission's final disposition of the proceeding.

(b) If review or reconsideration is sought or taken of a decision as to which an applicant believes it has prevailed, proceedings for the award of fees shall be stayed pending final disposition of the underlying controversy.

(c) For purposes of this rule, final disposition means the later of (1) the date on which an initial decision or other recommended disposition of the merits of the proceeding by an Administrative Law Judge or the Review Board becomes administratively final; (2) issuance of an order disposing of any applications for review or petitions for reconsideration of the Commission's order in the proceeding; (3) if no application for review or petition for reconsideration is filed, the last date on which such an application or petition could have been filed; (4) issuance of a final order by the Commission or any other final resolution of a proceeding, such as settlement or voluntary dismissal, which is not subject to a petition for reconsideration, or to a petition for judicial review; or (5) completion of judicial action on the underlying controversy and any subsequent Commission action pursuant to judicial mandate.

PROCEDURES For Considering APPLICATIONS

§ 1.1521 Filing and service of documents.

Any application for an award or other pleading relating to an application shall be filed and served on all parties to the proceeding in the same manner as other pleadings in the proceeding, except as provided in /S 1.1512(b) for confidential financial information.

§ 1.1522 Answer to application.

(a) Within 30 days after service of an application Bureau counsel may file an answer to the application. Unless Bureau counsel requests an extension of time for filing or files a statement of intent to negotiate under paragraph

(b) of this section, failure to file an answer within the 30-day period may be treated as a consent to the award request. (b) If Bureau counsel and the applicant believe that the

issues in the fee application can be settled, they may jointly file a statement of their intent to negotiate a settlement. The filing of this statement shall extend the time for filing an answer for an additional 30 days, and further extensions may be granted by the Administrative Law Judge upon request by Bureau counsel and the applicant.

(c) The answer shall explain in detail any objections to the award requested and identify the facts relied on in support of Bureau counsel's position. If the answer is based on any alleged facts not already in the record of the proceeding, Bureau counsel shall include with the answer either supporting affidavits or a request for further proceedings under § 1.1526.

$1.1523 Reply.

Within 15 days after service of an answer, the applicant may file a reply. If the reply is based on any alleged facts not already in the record of the proceeding, the applicant shall include with the reply either supporting affidavits or a request for further proceedings under § 1.1526.

§1.1524 Comments by other parties.

Any party to a proceeding other than the applicant and Bureau counsel may file comments on an application within 30 days after it is served or an answer within 15 days often it is served. A commenting party may not participate further in proceedings on the application unless the Administrative Law Judge determines that the public interest requires such participation in order to permit full exploration of matters raised in the comments.

§ 1.1525 Settlement.

The applicant and Bureau counsel may agree on a proposed settlement of the award before final action on the application, either in connection with a settlement of the underlying proceeding, or after the underlying proceeding has been concluded. If a prevailing party and Bureau counsel agree on a proposed settlement of an award before an application has been filed, the application shall be filed with the proposed settlement. If the Administrative Law Judge approves the proposed settlement, it shall be forwarded to the Commission for final approval.

§1.1526 Further proceedings.

(a) Ordinarily, the determination of an award will be made on the basis of the written record. However, on request of either the applicant or Bureau counsel, or on his or her own initiative, the Administrative Law Judge may order further proceedings, such as an informal conference, oral argument, additional written submissions or an evidentiary hearing. Such further proceedings shall be held only when necessary for full and fair resolution of the issues arising from the application, and shall be conducted as promptly as possible.

(b) A request that the Administrative Law Judge order further proceedings under this section shall specifically identify the information sought or the disputed issues and shall explain why the additional proceedings are necessary to resolve the issues.

§1.1527 Decision.

The Administrative Law Judge shall issue an initial decision on the application as soon as possible after completion of proceedings on the application. The decision shall include

written findings and conclusions on the applicant's eligibility and status as a prevailing party, and an explanation of the reasons for any difference between the amount requested and the amount awarded. The decision shall also include, if at issue, findings on whether the Commission's position was substantially justified, whether the applicant unduly protracted the proceedings, or whether special circumstances make an award unjust. If the applicant has sought an award against more than one agency, the decision shall allocate responsibility for payment of any award made among the agencies, and shall explain the reasons for the allocation made.

§1.1528 Commission review.

Either the applicant or Bureau counsel may seek Commission review of the initial decision on the fee application, or the Commission may decide to review the decision on its own initiative, in accordance with § 1.276 through 1.282 of this chapter. Except as provided in § 1.1525, if neither the applicant nor Bureau counsel seeks review and the Commission does not take review on its own initiative, the initial decision on the application shall become a final decision of the Commission 50 days after it is issued. Whether to review a decision is a matter within the discretion of the Commission. If review is taken, the Commission will issue a final decision on the application or remand the application to the Administrative Law Judge for further proceedings.

subject to random selection and hearing in accordance with any relevant rules. Competing applications for an initial license or construction permit shall be designated for random selection and hearing in accordance with the procedures set forth in § 1.1603 through 1.1623 and § 73.3572 of this chapter.

§1.1603 Conduct of random selection.

The random selection probabilities will be calculated in accordance with the formula set out in rules § 1.1621 through 1.1623.

[48 FR 27202, June 13, 1983, as amended at 48 FR 43330, Sept. 23, 1983] §1.1604 Post-selection hearings.

(a) Following the random selection, the Commission shall announce the "tentative selectee" and, where permitted by § 73.3584 invite Petitions to Deny its application. Following the responsive pleadings thereto, the Commission shall: (1) In the case of low power television stations, take action pursuant to either § 73.3591, 73.3592 or 73.3593.

(b) If, after such hearing as may be necessary, the Commission determines that the "tentative selectee" has met the requirements of § 73.3591(a) it will make the appropriate grant. If the Commission is unable to make such a determination, it shall order that another random selection be conducted from among the remaining mutually exclusive applicants, in accordance with the provisions of this subpart.

(c) If, on the basis of the papers before it, the Commission determines that a substantial and material question of fact exists, it shall designate that question for hearing. Hearings may be conducted by the Commission or, in the case of a matter which requires oral testimony for its resolution, an Administrative Law Judge.

§ 1.1621 Definitions.

(a) Medium of mass communications means: (1) A daily newspaper;

(2) A cable television system; and (3) A license or construction permit for

(i) A television station, including low power TV or TV translator, (ii) A standard (AM) radio station, (iii) An FM radio station, (iv) A direct broadcast satellite transponder under the editorial control of the licensee, and (v) A Multipoint Distribution Service station.

(b) Minority group means: (1) Blacks, (2) Hispanics (3) American Indians,

(4) Alaska Natives, (5) Asians, and (6) Pacific Islanders. (c) Owner means the applicant and any individual, partnership, trust, unincorporated association, or corporation which: (1) If the applicant is a proprietorship, is the proprietor, (2) If the applicant is a partnership, holds any partnership interest,

(3) If the applicant is a trust, is the beneficiary thereof, (4) If the applicant is an unincorporated association or nonstock corporation, is a member, or, in the case of a nonmembership association or corporation, a director,

(5) If the applicant is a stock corporation, is the beneficial owner of voting shares.

Note 1: For purposes of applying the diversity preference to such entities only the other ownership interests of those with a 1% or more beneficial interest in the entity will be cognizable.

Note 2: For the purposes of this section, a daily newspaper is one which is published four or more days per week, which

is in the English language, and which is circulated generally in the community of publication. A college newspaper is not considered as being circulated generally.

Note 3: For the purposes of applying the diversity preference, the ownership interests of the spouse of an applicant's principal will not presumptively be attributed to the applicant.

(50 FR 5992, Feb. 13, 1985, eff. Feb. 13, 1985)

§ 1.1622 Preferences.

(a) Any applicant desiring a perference in the random selection shall so indicate as part of its application. Such an applicant shall list any owner who owns all or part of a medium of mass communications or who is a member of a minority group, together with a precise identification of the ownership interest held in such medium of mass communications or name of the minority group, respectively. Such an applicant shall also state whether more than 50% of the ownership interests in it are held by members of minority groups and the number of media of mass communications more than 50% of whose ownership interests are held by the applicant and/or its

owners.

(b) Preference factors as incorporated in the percentage calculations in § 1.1623, shall be granted as follows: (1) Applicants, more than 50% of whose ownership interests are held by members of minority groups-2:1.

(2) Applicants whose owners in the aggregate hold more than 50% of the ownership interests in no other media of mass communications-2:1.

(3) Applicants whose owners in the aggregate hold more than 50% of the ownership interest in one, two or three other media of mass communications-1.5:1.

(c) Applicants may receive preferences pursuant to § 1.1622(b)(1) and either § 1.1622 (b)(2) or (b)(3).

(d) Preferences will be determined on the basis of ownership interests as of the date of release of the latest Public Notice announcing the acceptance of the last-filed mutually exclusive application.

(e) No preferences pursuant to § 1.1622(b)(2) or (b)(3) shall be granted to any LPTV or MDS applicant whose owners, when aggregated, have an ownership interest of more than 50 percent in the following media of mass communications, if the service areas of those media as described herein wholly encompass or are encompassed by the protected predicted contour, computed in accordance with § 74.707(a), of the low power TV or TV translator station for which the license or permit is sought, or computed in accordance with § 21.902(d), of the MDS station for which the license or permit is sought. (1) AM broadcast station-predicted or measured 2 mV/m groundwave contour, computed in accordance with § 73.183 or 73.186;

(2) FM broadcast station-predicted 1 mV/m contour, computed in accordance with § 73.313;

(3) TV broadcast station-Grade A contour, computed in accordance with § 73.684;

(4) Low power TV or TV translator station-protected predicted contour, computed in accordance with § 74.707(a); (5) Cable television system franchise area, nor will the diversity preference be available to applicants whose proposed transmitter site is located within the franchise area of a cable system in which its owners, in the aggregate, have an ownership interest of more than 50 percent.

(6) Daily newspaper community of publication, nor will the

diversity preference be available to applicants whose proposed transmitter site is located within the community of publication of a daily newspaper in which its owners, in the aggregate, have an ownership interest of more than 50 percent.

(7) Multipoint Distribution Service- station service area, computed in accordance with § 21.902(d)

(50 FR 5992, Feb. 13, 1985, eff. Feb. 13, 1985)

§1.1623 Probability calculation.

(a) All calculations shall be computed to no less than three significant digits. Probabilities will be truncated to the number of significant digits used in a particular lottery.

(b) Divide the total number of applicants into 1.00 to determine pre-preference probabilities.

(c) Multiply each applicant's pre-preference probability by the applicable preference from § 1.1622 (b)(2) or (b)(3). (d) Divide each applicant's probability pursuant to paragraph (c) of this section by the sum of such probabilities to determine intermediate probabilities.

(e) Add the intermediate probabilities of all applicants who received a preference pursuant to § 1.1622 (b)(2) or (b)(3).

(f)(1) If the sum pursuant to paragraph (e) of this section is .40 or greater, proceed to paragraph (g) of this section.

(2) If the sum pursuant to paragraph (e) of this section is less than .40, then multiply each such intermediate probability by the ratio of .40 to such sum. Divide .60 by the number of applicants who did not receive a preference pursuant to § 1.1622 (b)(2) or (b)(3) to determine their new intermediate probabilities.

(g) Multiply each applicant's probability pursuant to paragraph (f) of this section by the applicable preference ratio from § 1.1622(b)(1).

(h) Divide each applicant's probability pursuant to paragraph (g) of this section by the sum of such probabilities to determine the final selection percentage.

Subpart M-Implementation of Section 7 of the Radio Broadcasting to Cuba Act: Compensation of Costs of Mitigating Cuban Interference

SOURCE: 49 FR 12271, Mar. 29, 1984, unless otherwise noted.

§ 1.1701 Purpose.

(a) The regulations in this subpart implement section 7 of the Radio Broadcasting to Cuba Act, Pub. L. 98-111, 97 Stat. 749 (1983). That statute is referred to in this subpart as "the Act."

(b) Section 7 of the Act provides for the payment of compensation by the United States Information Agency (USIA) to radio broadcast station licensees for allowable expenses they incur in mitigating interference from Cuba to the broadcast service they provide. Subsection 7(c) directs the Federal Communications Commission to issue appropriate regulations and establish procedures for carrying out section 7.

(c) The regulations in this Subpart M establish the standards, requirements, and procedures that the Federal Communications Commission will apply in making findings as to whether applicants for compensation under section 7 of the Radio Broadcasting to Cuba Act qualify for it, and if they do, in what amounts. The Commission will transmit those findings to the USIA for guidance in the discharge of the

responsibility that the Act places upon the USIA to make such compensation payments.

§ 1.1702 Definition of Cuban interference.

For the purposes of this Subpart M, Cuban interference to a United States AM broadcast station is radiation from a radio transmitter in Cuba at a level that, under the provisions of the Final Acts of the Regional Administrative Radio Conference, Rio de Janeiro 1981, ("the Rio AM Agreement") would be treated as causing objectionable interference if it occurred between signatory countries.

§ 1.1703 Method for calculating the level of Cuban interference.

(a) The FCC will prepare, periodically update, and make publicly available a list of Cuban stations known to be operating on the 107 channels allocated for AM broadcasting. The list will show the location and calculated operating power of each Cuban station.

(b) In order to obtain the data needed to calculate the power of Cuban stations, the Commission will arrange for the monitoring of the groundwave signals of Cuban AM stations at suitable locations. The field strengths of the signals of Cuban stations operating on all 107 AM channels and the directions from which they are transmitted will be logged as nearly semi-monthly as practicable. The data so obtained will be used in making studies on the basis of which the location and transmitter power of each Cuban station will be calculated.

(c) In order to determine the existence and level of interference to United States AM radio broadcast stations for the purposes of this subpart, Cuban stations will be presumed to be operating at the locations and with the powers determined in the manner stated in paragraphs (a) and (b) of this section; and the methods for calculating interference prescribed in the "Rio AM Agreement" referred to in § 1.1702 will be used.

§ 1.1704 Minimum level and duration of interference qualifying licensees for compensation.

In order to be eligible for compensation under section 7 of the Act, the licensee of a United States AM radio broadcast station that does not come within the exception under § 1.1706(b) of this subpart must:

(a) Using the methods provided in § 1.1703(c), and treating the station's primary and secondary service areas separately, show that a Cuban station causes objectionable interference to the affected station's signals in a portion of its primary and secondary service area where at least 10 of the total population within that otherwise interference-free primary or secondary service area reside;

(b) Using the methods provided in § 1.1705, show that the signals of a Cuban station have been detected within the service area of the affected station on at least half of the days during a prescribed test period. The reception of such Cuban signals must be separately shown to occur during that part or those parts of the day (i.e., during daytime hours, nighttime hours, or both) when the interference pertinent to an application for compensation occurs.

§ 1.1705 Method for determining duration of Cuban interference.

(a) Section 1.1703 prescribes how the existence and level