Spectrum Bill Part of GOP Legislative Package

Would launch the process of broadcaster relocation and spectrum auctioning
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As expected, providing the FCC with authority to compensate broadcasters for moving off spectrum was included in the Republican's end-of-year legislative package, which was released Friday.

The package, which includes Democrat must-pass legislation like the payroll tax holiday extension and unemployment benefits, generally incorporates the Jumpstarting Opportunity with Broadband Spectrum (JOBS) Act, a House Communications Subcommittee version of spectrum incentive auction authority that passed out of that committee last week.

The bill gives the FCC the authority to pay broadcasters for reclaiming some of their spectrum -- it already has the authority to reclaim it, just not to pay for the privilege -- and sets up a mechanism to auction it for wireless broadband, though technically anyone could bid on it. It uses some of the proceeds from that auction to compensate broadcasters -- it does not say how much -- and to build a broadband emergency communications network, with the rest, an estimated $15 billion going to deficit reduction.

The legislation provides for up to $3 billion in relocation funding to broadcasters for being moved to another channel or for sharing channels in the repacking of spectrum to free it up for auction, although lost revenues will be reimbursed. It does not allow the FCC to force broadcasters on more DTV-friendly UHF channels to relocate to VHF. The FCC has to make "all reasonable efforts" to preserve the coverage areas of the stations left after reclamation and relocation.

The relocation fund, which includes up to $1,000,000 in borrowing authority, also goes to cable and satellite operators for any cost of carrying the reconfigured broadcast channels.

Also included was language in an amendment to the JOBS bill from Rep. Marsha Blackburn (R-Tenn.) that prohibits the FCC from putting wholesaling or network neutrality conditions on the spectrum or to prevent any company, including large incumbent wireless spectrum holders, from bidding.

The bill gives the FCC until 2021 to reclaim and auction the spectrum.  

It requires the FCC to hold only one reverse auction and only one repacking of broadcast spectrum. Broadcasters have pushed for only a single auction and further dislocation after the recent repacking for the DTV transition in 2009.

According to the bill, broadcaster's relinquishing of spectrum rights must be voluntary , the FCC must conduct a reverse auction -- broadcasters offer up spectrum to government, lowest price wins -- and at least two competing licensees must participate in that auction. The FCC must take "all reasonable steps" to protect the confidentiality, including withholding the identity, of stations offering up spectrum for the auction. A station that agrees to share channels will get the same must-carry rights they are otherwise entitled to.

A station can opt to use some of its spectrum for nonbroadcast uses in lieu of a relocation fund payout, so long as it maintains at least one free, over-the-air channel.

Now the question is how much of the bill remains by the time the package is voted on.  For example, some House Democrats took issue with the $3 billion for relocation, arguing $1 billion should be the figure. And the network neutrality conditions could be a poison pill with Senate Democrats, who control that body.

"It's good policy and good process that my amendment was included as part of the spectrum language in the overall package," Blackburn told B&C Fridaty in an e-mail. "Hopefully Democrats won't object to middle class tax relief and job creation just because they're dedicated to giving more power and control to the FCC - that would really show their true colors."

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