Spectrum Legislation Not Included In Year-End Omnibus, Tax Extenders Bills

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By Paul Barbagallo  

In the end, Senate leaders did not include spectrum policy legislation in either their two-month extension of the existing payroll tax cut or the $1 trillion omnibus spending bill.

It was believed that both legislative packages offered an opportunity to advance a bill authorizing the Federal Communications Commission to hold voluntary “incentive auctions” of spectrum, in which television broadcasters, who license spectrum through the FCC, could voluntarily release some of it back to the government in exchange for a share of the auction proceeds.

As part of such legislation, Congress would also dedicate a 10 megahertz block of spectrum and a portion of the auction revenues for the building a nationwide emergency communications network that would tie fire, police, and emergency first-responders together in the event of a national emergency, such as the terrorist attacks of Sept. 11, 2001.

The idea has garnered support from both Democrats and Republicans, as well as from the wireless industry, which is eager to bid on spectrum at auction to solve capacity demands created by smartphones and tablet computers; and from emergency first-responder agencies, which still do not have a nationwide interoperable communications network. But recent efforts to incorporate such a measure in broader spending packages ultimately failed, leaving both chambers to proceed through regular order.

The Senate approved its tax measure Dec. 17 on a 89-10 vote. The omnibus also cleared the chamber Dec. 17.

“Although we didn't get this done within today's [Dec. 17] agreement, I intend to push hard in the coming weeks to work out a suitable compromise with the House,” Senate Commerce Committee Chairman John D. Rockefeller, sponsor of spectrum legislation (S. 911) said in an e-mailed statement Dec. 17. “Build out of a public safety communications network is in our national interest. We cannot afford further inaction.”

In the weeks leading up to the Senate's vote, House Republicans had included a bill in its tax extenders package from Rep. Greg Walden (R-Ore.), the Jumpstarting Opportunity with Broadband Spectrum Act of 2011 (JOBS), to help offset the cost of unemployment insurance benefits, Medicare payments to doctors, and an extension of a payroll tax reduction. But Rockefeller and other Senate leaders disagreed sharply with their approach.

The points of contention continue to be how the Federal Communications Commission should structure incentive auctions; how much should be appropriated for the building of a nationwide emergency communications network; how the new network should be governed; how much spectrum should be set aside for “unlicensed” use; whether the FCC should be allowed to impose so-called net neutrality mandates on auction bidders; and whether the agency should ban larger carriers from auctions altogether.

In an e-mail Dec. 17, Vincent Morris, communications director for Rockefeller, confirmed that there are still a “handful of unresolved issues relating to the structure, cost, etc.” and that the extra time “works in our favor.”

“Our take on things is that this provides us more time to sort out a better version of the legislation with the House,” he said.

Several sources close to the matter told BNA that while Democrats and Republicans are still at odds over the legislation, there is a chance for compromise on the issue of funding and governance in the near term.

The House bill would provide between $5 billion and $6.5 billion for the network, depending on auction revenues, while S. 911 would set aside $11.75 billion. Rockefeller has indicated that he would be willing to compromise at $7.5 billion.

While Rockefeller has complained publicly that House Commerce Republicans have broken off talks, the failure of Senate leaders to include spectrum provisions in their year-end packages will force the sides to try to iron out the differences in their bills.

House Republicans have argued that the House has passed its legislation, and it is time now for the Senate to act.

Due to the recent developments, industry observers now expect the Senate and House to make spectrum policy reform a top priority early in 2012.

By Paul Barbagallo