Lawmakers Seen Nearing Deal to Extend FCC Spectrum Auction Authority Through Dec. 16

Telecom-focused lawmakers are hopeful they will be able to reach a final deal in the coming days to include a short-term extension of the FCC’s expiring spectrum auction authority in a potential continuing resolution to extend federal appropriations past Sept. 30 (see 2209090053). Talks Wednesday appeared to be strongly coalescing around a stopgap reauthorization through Dec. 16 -- in line with the likely expiration of the overall CR -- but there’s been no final deal, lawmakers and lobbyists told us. Lawmakers believe the temporary renewal will give them more breathing room to reach a deal on a broader spectrum legislative package during the lame-duck session (see 2208090001).

There was diminishing likelihood Wednesday of final CR text appearing this week as previously expected, lobbyists said. Congressional leaders cited an impasse on whether the measure will include permitting overhaul language Senate Majority Leader Chuck Schumer, D-N.Y., previously agreed to attach in exchange for backing from Sen. Joe Manchin, D-W.Va., to pass the Inflation Reduction Act budget reconciliation package (see 2208160051). Manchin planned to release his proposal Wednesday night.

An extension through Dec. 16 “may be what happens” but isn’t a formal offer yet, said Senate Commerce Chair Maria Cantwell, D-Wash. “We’re still trying to figure out a big-picture deal that we can get to.” A broader spectrum package is preferable, “but I don’t think that’s possible in this period of time,” she said: “The question is what’s the next step to keep the discussions going?” Cantwell expects “things will come more to a head as we get closer" to the Sept. 30 deadline.

The Dec. 16 date “is getting to be in place” as a CR element but lawmakers haven't finalized it yet, said Senate Commerce Committee ranking member Roger Wicker, R-Miss. “It’s nine days until the end of the fiscal year” and negotiations remain very fluid, said Communications Subcommittee ranking member John Thune, R-S.D. “We haven’t gotten much visibility” into what current text on the auction authority extension or other CR elements will look like.

House Communications Subcommittee Chairman Mike Doyle, D-Pa., is putting the onus on Senate Commerce leaders to reach a consensus due to House passage of the Spectrum Innovation Act (HR-7624), which would renew the FCC’s authority for 18 months (see 2207280052). “The ball’s in their court right now” and a “deal could happen really quick if they wanted to,” he told us: “They don’t seem to be in a hurry” now, but “I can’t believe” senators actually “want to allow the auction authority to expire. We’ve never let that happen before.”

Doyle Expects Stopgap

Doyle has warmed to including a short-term authority renewal in the CR as a temporary solution, a shift from his more vocal insistence before the August recess that Senate leaders affirm HR-7624 without significant changes (see 2208010030). “That’s not an ideal situation, but it’s better than letting” the FCC’s remit expire, he said: “It seems to me there’s still a chance to get something done and maybe more than just that” as part of a broader measure.

“We’re running out of time” to reach a deal on any kind of extension “and if we don’t have it, we’re in big trouble because there are a lot of priorities that depend on” the FCC’s authority remaining in place, said House Communications ranking member Bob Latta, R-Ohio.

New Street’s Blair Levin and other officials believe a deal on a temporary renewal remains likely despite the rapidly closing legislative window before Sept. 30. Lobbyists noted Congress frequently waits until the brink of a government shutdown to reach deals on CRs. “The presumption” remains the CR will have language to extend the auction authority into December “and then address it during the lame-duck session as part of a four-corners” negotiation between Democratic and GOP leadership on the House and Senate Commerce panels, said New America’s Open Technology Institute Wireless Future Project Director Michael Calabrese.

Lobbyists emphasized Cantwell and other lawmakers all have an interest in allowing more time for negotiations. Cantwell hopes a final spectrum package would allocate some auction revenue to pay for her Grant to Rapidly Invest and Deploy (Grid) Broadband Act (S-4763), which aims to incentivize building a nationwide middle-mile broadband backbone along the existing U.S. electricity grid (see 2208100062), lobbyists said: Senate Communications Chairman Ben Ray Lujan, D-N.M., will likely seek to use some auction money to pay for the Digital Equity Foundation Act (HR-8858/S-4865) to create a nonprofit foundation to disburse funding for digital equity, inclusion and literacy projects and support related activities (see 2209160047). Wicker wants to also have an impact on a broader spectrum package as part of his legacy as lead panel Republican before he leaves in January to take on the top role on the Armed Services Committee, lobbyists said.

“One of the most successful” bipartisan policy changes “in the last 30 years has been” the federal government’s shift from “awarding spectrum through a lottery to an auction process” and no one is seeking to “go back to what we did before,” Levin told us: Congress is highly unlikely to reach a deal before Sept. 30 on a “long-term plan for that authority,” but they likely will agree to “keep it going” until they can have “a more thoughtful, thorough kind of change.’”

FCC Chairwoman Jessica Rosenworcel and NTIA Administrator Alan Davidson “are particularly well suited” to collaborating on “a long-term spectrum plan that will have bipartisan support and open the door to” a potentially rare piece of bipartisan legislation in 2023 if there’s divided control of Congress via “a Spectrum Reform Act,” Levin said: That is a distinct possibility.”

Ex-Commissioners

Cooley's Robert McDowell and two other former FCC commissioners said during a Hudson Institute hybrid event Wednesday that they remain hopeful Congress will vote soon on a full extension, noting the commission still must wrap up work on the 2.5 GHz auction. McDowell and former Commissioners Harold Furchtgott-Roth and Mike O’Rielly disagreed on how long an extension should run.

Congress time-limited the FCC’s authority in 1994 because at the time spectrum auctions were controversial, Furchtgott-Roth said. “I don’t know of anyone who thinks auctioning spectrum has been a bad idea,” he said. Furchtgott-Roth believes the FCC’s authority should be permanent.

“It is a bit of a head scratcher -- everybody knew since the spectrum act of 2012 there was 10 years to get another extension of the authority and refill the spectrum pipeline, but here we are nonetheless,” McDowell said. “We shouldn’t be at this point,” McDowell said. “This is normally a bipartisan no-brainer,” he said. McDowell expects Congress to act by the end of the month but “these things can fall apart.”

O’Rielly said he expects Congress will extend the FCC's authority, though he supports time limits like the 18 months proposed in HR-7624. “I like to keep Congress in the mix,” he said: “I don’t believe in permanent authority. … It’s always appropriate for Congress to be involved in the [spectrum] pipeline issue.”

McDowell said he spoke with FCC officials months ago about the implications for the 2.5 GHz auction, which ended last month (see 2208290043). “I think they are confident that the tying up of loose ends from that auction can happen after an expiration has happened -- that the auction has concluded and they would not be in violation of the law,” he said.

The FCC’s 2.5 GHz spectrum auction yielding $427.8 million, below earlier forecasts, is unlikely to diminish the need for renewing the commission’s remit, McDowell told us. “Spectrum will continue to yield tens of billions of dollars” in revenue “and the modest yield from the 2.5 GHz auction shouldn’t deter Congress from marching forward,” McDowell said: “America needs more spectrum.” The commissioners also addressed 13 GHz and other issues Wednesday (see 220921005). Rosenworcel said in August it could take several months to complete post-auction work (see 2208050023).

McDowell and former Commissioner Mignon Clyburn raised concerns about the potential authority expiration in a Wednesday Roll Call opinion piece. “What if the federal government stopped auctioning the radio frequency spectrum that fuels consumers’ wireless devices?” they asked. “Far from hyperbole, this could actually happen.” A "powerful tool in the FCC’s toolbox we used often was the ability to auction spectrum,” the ex-commissioners said: “Our work helped pave the way for the evolution from 3G to 4G and we helped set the stage to forge ahead into the 5G frontier by working with Congress to shape the FCC’s auction authority" via the 2012 spectrum law, but that statute's "auction provisions expire in a matter of days.”