NTIA, FCC Clash Over Reimbursement Requirements for 3.5 GHz Auction
The FCC apparently missed a deadline to notify NTIA 18 months before the start of the 3.5 GHz auction that an auction would be scheduled. Commissioners approved a public notice on bidding procedures for the citizens broadband radio service auction, to start June 25, at their meeting Thursday. But the FCC denied the band is even subject to Commercial Spectrum Enhancement Act (CSEA) requirements. Earlier this year, the Commerce Department and FCC engaged in a battle over 24 GHz band. (see 1908090070).
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In a letter, NTIA reminded the FCC of the importance of the 18-month notice to its planning process. NTIA doesn’t want to slow or block the auction, but wanted to get into the record that reimbursement provisions apply to the auction of priority access licenses (PALs) and that’s not mentioned in the PN, its officials told us. NTIA says in a footnote then-Chairman Julius Genachowski sent a letter to NTIA in March 2013, notifying NTIA it planned to launch an auction of AWS-3 spectrum, as early as September 2014.
“The claim that the Department of Commerce did not know this auction was coming is absurd,” an FCC spokesperson emailed. The commission has been working with NTIA “since at least 2012 to make this auction a reality,” the spokesperson said. As the FCC told Commerce “repeatedly, the long-shared frequencies in the 3550-3650 MHz band are not ‘eligible frequencies’” under the CSEA “so the law’s notice provisions don’t apply in the first place.”
“Unfortunately, this is just the latest attempt by the Department of Commerce since NTIA Administrator David Redl was forced to ‘resign’ to delay, if not obstruct, the commission’s efforts to promote United States leadership in 5G,” the FCC spokesperson said.
“We have been working for months with the FCC to make this auction a reality and fully support the administration’s efforts to promote U.S. leadership in 5G,” an NTIA spokesperson told us: The CSEA “was amended to permit government agencies to recover reasonable costs associated with sharing valuable spectrum with new entrants, which does apply to the 3550-3650 MHz band. The Department of Defense has identified recoverable costs which can and should be paid from auction proceeds, rather than by U.S. taxpayers.”
NTIA said it faces a deadline in three months to notify the FCC of relocation and sharing costs and associated timelines. NTIA filed the letter Wednesday. It posted Thursday in docket 19-244. “The frequencies in the 3550-3650 MHz band are ‘eligible frequencies’ as described in Section 113(g)(2) of the NTIA Organization Act,” NTIA said: “The FCC must notify NTIA 18 months prior to the anticipated commencement of an auction of such frequencies.”
The same provision requires that six months before the auction, after review by OMB, NTIA must “notify the FCC of estimated relocation or sharing costs and timelines for such relocation or sharing.” The times in the NTIA Organization Act “are necessary to allow NTIA and Federal agencies to meet the transition planning milestones in the statute and to provide transparency and critical information to bidders in advance of an auction,” NTIA said. It told the FCC the Navy, Marine Corps and Army “intend to submit a transition plan to identify these Federal entities' estimated sharing costs that have or will be incurred in connection with the sharing of these eligible frequencies.”
NTIA officials said Friday they're working to address the reimbursement requirements discussed in the letter and will work within the FCC timeline.
“As far as I can tell, the law doesn't specify how the FCC is required to notify the NTIA” under the Spectrum Act, said Tom Struble, R Street Institute tech policy manager. “The FCC's orders are all published in the Federal Register, so I think the FCC would argue that the NTIA has constructive notice about the FCC's upcoming 3.5 GHz PAL auctions, even if there wasn't a personal letter sent from one agency head to the other.” If the commission rushed the process, “that wouldn't give the NTIA enough time to fulfill its obligation under the law, so although everyone wants to get more mid-band spectrum into the marketplace as soon as possible, there is a limit on just how quickly the FCC can move here,” Struble told us. “Perhaps the NTIA wanted a formal letter like the one Chairman Genachowski wrote, but I think the manner in which the FCC provided notice and the proposed timeline it gave for the 3.5 GHz PAL auctions is all in compliance."
Other FCC and industry officials said they don’t expect the fight over the notice to delay the auction. “It’s an oversight," said Roger Entner, analyst at Recon Analytics. "The auction will proceed as expected.”
The Wireless ISP Association Friday applauded some of the PN's language. “The proposal to require bidders for a CMA [cellular market area] to forego bidding on individual counties in that CMA appears to incentivize sincere bidding and deter price manipulation for counties,” said Louis Peraertz, vice president-policy. “The CMA bidding proposal also appears to require that in order for a CMA bidder to win a license, it must be the highest bidder in all of the counties in a given CMA." He said the safeguards "will assist small companies, such as WISPA members, who are interested in PALs for counties.”