Trump Budget Envisions FCC Operating at $18 Million Less, With 102 Fewer FTEs

The Trump administration FY 2018 budget request would cut FCC funding by about $18 million. The White House unveiled the documents Tuesday, and several stakeholders said Congress won't take up the proposal as drafted. The funding measure comported with a previous outline and moved to nix funding for the CPB, including a small portion of funding as part of a winding-down process.

A GOP appropriator sees the proposed FCC cut as welcome news. “I applaud them for finding ways to reduce their expenses and their needs,” House Appropriations Financial Services Subcommittee Chairman Tom Graves, R-Ga., said in an interview Tuesday. “I look forward to hearing their justification for it and actually applaud them if they’re presenting a budget for less and showing they can get more done for less -- that’s what we’re looking for.”

The FCC posted its justification Tuesday in a 131-page document that called for more than a hundred fewer workers in FY 2018: “In creating a lean, accountable, more efficient Commission that works for the American people, the Commission requests 1,448 Full Time Equivalents (FTE’s) for regulatory fee offsetting collections and the spectrum auctions program. This request represents a decrease of 102 FTEs or 6.6 percent from the FY 2017 enacted level of 1,550.” A chart shows that would be the lowest number of FCC employees since at least 1983. The commission cited the hiring freeze as one element affecting its employee listings.

Among the worker numbers in individual offices and bureaus: FTEs in the chairman and commissioners’ offices would rise from 16 to 20; the Consumer and Governmental Affairs Bureau FTEs would drop from 135 to 126; Enforcement Bureau FTEs from 204 to 189; International Bureau FTEs from 98 to 92; Media Bureau FTEs from 161 to 149; Public Safety Bureau FTEs from 100 to 93; Wireless Bureau FTEs from 208 to 192; Wireline Bureau FTEs from 167 to 155; Office of Engineering and Technology FTEs from 77 to 72; Office of General Counsel also from 77 to 72; Office of Legislative Affairs from 8 to 7; and Office of the Managing Director from 194 to 178.

IT, Spectrum

Former Chairman Tom Wheeler previously lamented the FCC’s frozen funding, locked at $340 million annually for years. The new budget proposes about $322 million for the commission. Wheeler frequently testified of pressing needs, such as overhauling its IT system.

“In moving towards the goal of 100 percent cloud based services, the FCC will continue to modernize its IT systems and applications to ensure the availability, integrity, and confidentiality of the Commission’s systems and support our nation’s communication infrastructure,” the FCC budget document said, listing IT as a priority. The FCC struggled with IT this year in its open internet proceeding, with people encountering difficulties in the online comment system. The Trump administration’s appropriations document included provisions on the 2015 Spectrum Pipeline Act, authorizing Spectrum Relocation Fund money for R&D. “The Budget proposes to require the auction of additional spectrum by 2027 and further extend the FCC's auction authority solely to allow this auction to proceed,” said one administration outline. “Auction proceeds are expected to exceed $6.0 billion in 2027.” The budget “proposes that the FCC either auction or use fee authority to assign spectrum frequencies between 1675-1680 megahertz for flexible use by 2020, subject to sharing arrangements with Federal weather satellites,” the FCC justification said.

The administration also included the perennial provisions about spectrum license user fees, which would yield $4 billion through 2027. Such a proposal had been part of Obama administration budget proposals, too, and was never considered by Congress. “Broadcast stations already pay tens of millions of dollars in regulatory fees every year,” an NAB spokesman said Tuesday: “NAB will strongly oppose proposed new spectrum taxes or fees" on broadcasting.

Congressional Democrats criticized the White House plan but didn’t dwell on the FCC portions. Capitol Hill appropriators will craft their own FCC funding bills in the course of Financial Services subcommittees. Senate Majority Leader Mitch McConnell, R-Ky., called the budget a “recommendation.” Congress will take the plan “into consideration but we’ll write the bills,” Senate Commerce Committee Chairman John Thune, R-S.D., told reporters.

Hearings Ahead

Both GOP chairmen of the Financial Services subcommittees -- Graves in the House and Shelley Moore Capito, R-W.Va., in the Senate -- favor FCC Chairman Ajit Pai and expect to have him for appropriations hearings in the months ahead (see 1702230049). “I assume that the budget request as it relates to the FCC was submitted by the chairman of the FCC and their folks as they prepared it,” Graves told us. “Now that their budget is officially presented, we’ll begin the process of having hearings to discuss.” Office of Management and Budget Director Mick Mulvaney had wanted the agency hearings to wait until the official FY 2018 presentation this week, and now that this has happened, “I think you’ll start seeing committee meetings move forward rather rapidly.” Graves finds the overall budget “pretty impressive and it’s honest,” he said.

Capito “looks forward to continuing her work with Chairman Pai on their shared priorities,” a spokeswoman emailed. “The four goals listed in the FCC's budget -- Closing the Digital Divide, Promoting Innovation, Protecting Consumers and Regulatory Reform -- are all things she supports and is eager to work with him on.” She “will chair a hearing with Chairman Pai in the coming weeks to discuss” whether the funding is sufficient for those priorities, the spokeswoman said.

The FTC budget request is for $306 million, laid out in a 191-page justification. NTIA’s is for $36 million, a cut from past years. The White House also proposed to ax much CPB funding, although it's “technically not eliminating” the CPB, OMB’s Mulvaney said Monday on a call with reporters. He said the White House would account for 15 percent of its funding as part of a wind-down process. GOP appropriators overseeing CPB in both chambers told us this year they foresaw CPB maintaining its funding once Congress processes spending bills.

CPB CEO Pat Harrison called federal funding the “foundation” of the entity’s public-private partnership: “The elimination of federal funding would take away this vital foundation. Local public media stations, beginning with those serving rural communities and small towns, would cease to exist.” America’s Public Television Stations are “disappointed” in the “proposal recommending the elimination of federal funding for public media,” CEO Patrick Butler said. “We will continue to make our case to the White House.”