Senate Commerce Leaders Split on Spectrum Authority Timeline; FCC, NTIA Update MOU

Senate Commerce Committee Democratic and Republican leaders divided along party lines during a Tuesday Communications Subcommittee hearing on their preferences for extending the FCC’s spectrum auction authority, the dominant focus during the panel, as expected (see 2208010030). Communications Chairman Ben Ray Lujan, D-N.M., strongly backed a longer-term renewal than the House proposes in its Spectrum Innovation Act (HR-7624). Commerce ranking member Roger Wicker, R-Miss., and Communications ranking member John Thune, R-S.D., back HR-7624’s proposed 18-month renewal.

Lawmakers also eyed the potential for a spectrum legislative package to mandate improvements to coordination between the FCC, NTIA and other federal agencies, citing the Monday signing of the updated FCC-NTIA memorandum of understanding. FCC Chairwoman Jessica Rosenworcel and NTIA Administrator Alan Davidson unveiled the revised MOU, which updates an earlier 2003 agreement, just before the Senate Communications hearing.

“While I support the progress” the House made in passing HR-7624, “I believe we must go further” than that bill proposes, Lujan said: “Kicking the can down the road,” as an 18-month renewal appears to do, “benefits no one.” He demonstrated a clear preference for a “longer-term extension” of the FCC’s authority, saying it would “strengthen” spectrum policymaking at the FCC and NTIA. He later probed witnesses about whether a middle-ground was possible on a renewal time period.

A “short-term extension is needed” given the limited time left before Sept. 30, Wicker said. An 18-month renewal will give lawmakers time to “look to the expert spectrum agencies for guidance” on how to structure a longer-term renewal, including creating a specific pipeline of additional bands the FCC can repurpose for commercial and other uses. There were “22 legislative calendar days” left Tuesday before the current authority expires, Thune said: He supports “a short-term extension” with the idea that it’s “important for Congress” to weigh in on matters like a specified spectrum pipeline as part of a follow-on legislative package.

Thune and other Republicans repeatedly focused on CTIA President Meredith Baker's call for the Senate to make a "technical correction" to language in Democrats' proposed Inflation Reduction Act reconciliation package that would set a 15% minimum corporate tax rate so it doesn't cover carriers' spectrum deployments. Sen. Shelley Moore Capito of West Virginia said she's concerned "this tax increase will delay closing the digital divide."

Baker and Public Knowledge CEO Chris Lewis disagreed on HR-7624's proposed 18-month authority extension, as expected. An 18-month approach will “give all stakeholders the time to contribute towards the development a new spectrum pipeline” that can be combined with a longer-term extension, Baker said: All parties “want a balanced spectrum policy that enables government agencies to meet their missions” while also “enhancing and expanding commercial access.” A “balanced approach applies in equal force to promoting both licensed and unlicensed solutions,” but currently “that balance is out of whack,” particularly when it comes to mid-band spectrum,” she said.

But 18 months “is well short of the long-term commitment we need,” Lewis said. “Limiting the FCC’s auction authority to a time frame that prevents it from conducting even a single auction is unbalanced, short-term thinking.” It “does not promote the best and most efficient use of this valuable public resource,” he said: “It treats spectrum as nothing more than an ATM. Instead, auctions should serve as one of many tools that the FCC can use to secure a sustainable wireless future for America.” Lewis urged lawmakers to use some spectrum auction proceeds to fund a Digital Equity Foundation to help close the digital divide that PK and other groups proposed in February (see 2202230058).

Brattle Group principal Coleman Bazelon cautioned lawmakers against focusing too much on the Congressional Budget Office's potential scoring of a spectrum package. The CBO score "is not an estimate of how much the spectrum is worth or how much bidders will bid," he said: "It is an estimate of the net effects of the proposed auction on the federal budget." The "key with budget scoring is that the legislation is credited with the budgetary impact that the legislation causes," Bazelon said: "Although budget scoring rules can create an incentive for legislation to facilitate reallocations that might not otherwise happen, budget rules will never be the guide for good spectrum policy."

MOU Updates

The updated FCC-NTIA MOU, for the first time, mandates that the FCC chair and NTIA administrator hold “formal meetings to conduct joint spectrum planning at least quarterly.” Staff will meet “at least monthly” and “where possible, the agencies will share their planned spectrum activities for the next 12 months.” The two agencies agreed to more coordination than in the past “including when the agencies are considering taking actions that would create new spectrum adjacencies.” The language codifies the informal agreement Davidson and Rosenworcel reached in February (see 2202150001), which included plans to revise the 2003 MOU.

Both pledge in the updated agreement to “share information, concerns, or views as early in the spectrum planning process as possible, supported by technical data and analysis that is based on sound engineering principles,” the MOU says: “For NTIA, this includes sharing information, concerns, or views of other federal agencies as well.” The agencies also agreed to “work together to develop and implement a process for escalating any disputes for consideration by agency leadership.”

The MOU update represents "real progress, but the work is just beginning," Lujan said: "I think that needs to be emphasized," in part because the agreement's implementation will be important to ensuring its success. Congress needs to ensure the FCC and NTIA are both "empowered" to ensure smoother spectrum policy coordination. Thune pointed to the need for Senate Commerce to move on the Improving Spectrum Coordination Act (S-1472), which would require the FCC and NTIA regularly update the MOU, including to add language on a process for addressing interagency policy differences and instituting a resolution process. Wicker pulled S-1472 from a May Senate Commerce markup (see 2205250063) amid an amendment dispute with Sen. Deb Fischer, R-Neb.

Industry experts said the new MOU could help address the need for coordination, in light of numerous high-profile spectrum fights, capped by the dispute between the FAA and airlines and the FCC and the wireless industry over the C band, which has become the key spectrum for Verizon and AT&T as they build out 5G (see 2201180065). The Commerce Spectrum Management Advisory Committee approved a prototype MOU last year for the agencies to consider (see 2101140048).

Former FCC Commissioner Mike O’Rielly expressed some skepticism. “There appears to be little inherently problematic with the updated MOU, except to suggest that it will have all that much practical impact,” O’Rielly told us: “FCC and NTIA already have strong, positive interactions. I’m having trouble seeing how this gets more spectrum bands into the commercial marketplace or curtails federal agencies from ignoring NTIA’s role.”

The test will be how well the agencies adhere to the agreement, said Information Technology and Innovation Foundation Broadband and Spectrum Policy Director Joe Kane. “There are a number of specific processes that … will be helpful in building trust and cooperation between the agencies, which will yield more positive-sum agreements and less adversarial competitiveness,” he said: “It is good that it preserves the language from the 2003 MOU that the FCC does not need approval from NTIA to make spectrum policy.”

The major adds to the earlier MOU “seem to be about providing evidence-based contributions to each other's proceedings using high-quality data,” Kane said: “This is an encouraging sign that the agencies will use their own considerable engineering expertise to resolve interference disputes in rigorous and transparent ways that maximize what we can do with spectrum rather than fighting for turf.”

'Institutionalizing' Collaboration

The efficacy of the new agreement “will need to be proven in practice,” emailed Free State Foundation Policy Studies Director Seth Cooper. “Success will depend critically on agencies acting in good faith to resolve their disputes through the new MOU framework rather than employing hyperbolic attacks on contested spectrum proposals using outside channels,” he said: “The new MOU's formal requirements that the FCC and NTIA give each other 20-day advance notice regarding interference concerns and final actions on spectrum matters may help stop dubious process-based attacks on Commission spectrum decisions like the ones made against the 2020 L-band Order."

“Alan and Jessica are the kind of dedicated and collegial public servants who would not need a document to engage in this kind of collaboration,” said New Street’s Blair Levin: “The history of the FCC and NTIA suggests that institutionalizing this kind of collaboration is a good idea.”

The big change is that under the new MOU the FCC must give NTIA notice of “all proposed actions” a minimum of 20 days before final action, emailed New America Open Technology Institute Wireless Future Program Director Michael Calabrese. The previous MOU required only 15 days' notice before final action, he noted. “It’s very important that the FCC is now committed to giving notice of proposed and not just final actions,” Calabrese said: “The updated MOU effectively puts NTIA on notice at the outset of a proceeding, giving NTIA a strong nudge to consult impacted federal agencies and to participate in the proceeding by filing comments and its own technical data, where appropriate.” Another big advance is the MOU recognizes that “critical commercial spectrum uses, such as flight safety, are heavily regulated and so NTIA should be notified when an FCC proposal or action would impact those services, even if they are in an adjacent band,” he said. That would help “ahead of scenarios such as the claimed interference by mobile carrier C-band operations with flight safety altimeters,” he said.

The MOU is “a long needed update to promote cooperation and coordination between these two important spectrum expert agencies,” said Jonathan Cannon, R Street Institute fellow-technology and innovation. “It's imperative they balance the need of both federal and government spectrum to ensure a robust spectrum pipeline in the future,” he said: “There is only so much these two agencies can do alone, and hopefully Congress and other executive agencies will work with the FCC and NTIA to avoid some of the recent spectrum disagreements from happening in the future."