Washington

New Bill Would Provide $1 Billion Auction Emergency Fund

Broadcasters would get help replicating coverage in repack 1/05/2016 01:40:00 PM Eastern

The National Association of Broadcasters says it is a big supporter of a draft bill that would try to ensure a consumer-friendly repack of TV stations after the upcoming incentive auction, including by apparently providing a cushion if the FCC's $1.75 billion post-auction channel moving expenses is not enough.

Rep. Frank Pallone (D-N.J.), ranking member of the House Energy & Commerce Committee has circulated a draft of the Viewer Protection Act, a bill that would 1) fund a viewer education effort about where to find their TV channel after the repack of stations; 2) create a $1 billion emergency fund the FCC could access "if viewers are at risk of losing their broadcast signal; and 3) put the FCC on a five-month clock to come up with the repack plan after the auction to speed the spectrum's transfer to wireless bidders in the forward auction. The FCC would also get limited authority to modify the repack to "protect broadcast viewers."

The emergency fund would be available to supplement the $1.75 billion Congress allocated in the spectrum auction legislation to make sure broadcasters were held harmless, at least for expenses, for having to move to new channels in the post-auction repack and replicate their coverage areas so viewers would not lose signals. The spectrum legislation said the FCC had to make its best effort to replicate those coverage areas, but broadcasters have been concerned the $1.75 billion might not cover all the tower and transmitter and other moves necessary to accomplish that.

But a source familiar with Pallone's thinking said the point of the fund is to make sure viewers still get their signals, rather than broadcasters get more money.

According to a source in contact with the committee, the $1 Billion for the fund comes from the Treasury, not the auction proceeds (though that is where the left-over proceeds are going anyway), so it would not raise the price of closing the incentive auction.  

“As we approach the Broadcast Incentive Auction, it is critical that we make this transition as seamless as possible for consumers without interruptions in their service,” said Pallone in circulating the draft. “When Superstorm Sandy hit, we saw firsthand how critical it is to have access to local news and information. The Viewer Protection Act will help to ensure that viewers’ TVs do not go dark because we never know when another emergency might occur. At the same time, my bill will ensure consumers of mobile broadband reap the benefits of the incentive auction as soon as possible.”

In a statement, NAB spokesman Dennis Wharton said the NAB "strongly supports" what he called the "pro-consumer" draft. "Millions of viewers reliant on broadcast television could be seriously harmed if this auction is not handled correctly," he said in a statement. "Ranking Member Pallone is proposing a smart, consumer-friendly approach that addresses urgent ‘repacking’ issues that must be addressed to achieve a successful and truly voluntary incentive auction. NAB looks forward to working in bipartisan fashion to protect broadcast viewers in communities across the country."

The bill does not have any co-sponsors yet, but it is early in the process. The source said there was no timetable for the bill's official introduction and that it was still in the discussion draft phase.

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