FCC Sets July Deadline for Calculating Sprint 800 MHz True-Up Payment
Sprint Nextel’s could have to pay the FCC after July 1, not after the 800 MHz rebanding is complete as the company had asked, for spectrum it received in rebanding, under a commission order released Wednesday. But the FCC may extend the date for calculating the amount the carrier owes, based in part on the recommendation of the 800 MHz Transition Administrator, the commission said. The original deadline for setting an “anti-windfall” true-up payment was Friday (CD Dec 22 p1).
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“While we continue to review the details of the Order, we're pleased that the FCC has decided to defer the true-up process,” a Sprint spokesman said Wednesday. “We look forward to continuing to work with public safety to complete rebanding as soon as possible with minimal disruption to all licensees.”
When the FCC approved the landmark 800 MHz rebanding order in July 2004, it set the value of the 10 MHz national license that Nextel was to receive for spectrum it was giving up at $4.8 billion. The commission set the value of spectrum that Nextel had agreed to contribute at $2 billion. That left $2.8 billion in costs for Nextel to cover, to be largely offset by its rebanding expenses. Sprint has spent $1.6 billion, mostly to pay for retuning public-safety transmitters across the U.S. The carrier estimates it will eventually have spent as much as $3.4 billion. The process is taking longer than expected, and during the summer the FCC gave more than 500 public safety licensees extra time to complete their moves to other spectrum.
“We decline to postpone the true-up process until the conclusion of rebanding as Sprint proposes,” the order said. “Because the final completion date for rebanding remains uncertain, Sprint’s proposal would create similar uncertainty with respect to the timing of the true-up process.” The FCC said “while we believe that initiating the true up as originally scheduled would be premature, it may be appropriate to conduct the true-up before rebanding is complete.”
The TA is directed to file a report by May 1 stating whether rebanding has advanced enough that a July 1 true-up date is appropriate and “whether the true-up deadline should be extended for an additional period.” The Public Safety Bureau is delegated by commissioners to decide whether to put off the deadline further.
The order also rejects a request by Sprint for a new schedule to finish 800 MHz Phase II rebanding. It also denies several petitions for reconsideration by licensees asking that Sprint have to cover their post-mediation litigation costs when rebanding disputes are brought before the FCC for review. And it orders the Public Safety Bureau to adopt an alternative rebanding plan for the U.S. Virgin Islands, as it has for Puerto Rico.