A bipartisan legislative package that would reauthorize the Federal Communications Commission and resolve several issues related to spectrum auctions is on a fast track to becoming law after its inclusion in Congress' $1.3 trillion spending bill.
The larger omnibus bill, counting roughly 2,300 pages in length, includes the Repack Airwaves Yielding Better Access for Users of Modern Services Act, or RAY BAUM'S Act, which allocates $333.1 million for fiscal year 2019 to the FCC. The amount is in line with the commission's budget request, released in February, which noted that $333.1 million represents a decrease of $21.2 million or 6% from the 2018 annualized continuing appropriation level of $354.3 million. For fiscal 2020, the bill allocates $339.6 million for the agency.
In addition, the legislation authorizes a spectrum repack fund to address the shortfall in funding available to relocate broadcasters being displaced following the 600 MHz incentive auction. During the auction, broadcasters sold their spectrum, and it was eventually acquired by mobile network operators. Now, to clear the bands into usable blocks, the FCC must reorganize broadcasters into remaining TV bands. Though Congress initially allocated $1.75 billion for the repacking process, the amount is widely expected to prove insufficient. The new spending bill allocates an additional $600 million for fiscal 2018 and $400 million for 2019.
In terms of spectrum, the legislation also includes a provision that allows the FCC to deposit upfront auction payments directly with the U.S. Treasury Department. The Communications Act currently requires the FCC to deposit any upfront payments from bidders in spectrum auctions in an interest-bearing account at a financial institution. However, private banks have told the FCC they do not want to hold these upfront payments, and public institutions have declined to set up the special purpose accounts necessary to offer such services. FCC Chairman Ajit Pai has said the commission cannot hold any further spectrum auctions until Congress changes the law so that deposits from spectrum auctions bidders can be sent to the Treasury Department. Pai said he hoped to hold an auction in November for high-band spectrum in the 28 GHz band, followed immediately by a second auction for spectrum in the 24 GHz band, making the need for a legislative fix for the handling of upfront auction payments quite pressing.
The omnibus bill also includes the Making Opportunities for Broadband Investment and Limiting Excessive and Needless Obstacles to Wireless Act, or MOBILE NOW Act, which directs the National Telecommunications and Information Administration of the Department of Commerce to identify a total of at least 255 MHz of federal and non-federal spectrum for mobile and fixed wireless broadband use.
The House passed the spending bill 256-167 on March 22 and the Senate is set to pass it before the government shuts down March 23.