New Spectrum Auction Emerging as Possibility in Infrastructure Discussions

Trump personally raised “the possibility of auctioning the broadcast spectrum to wireless carriers,” speaking Wednesday during a private infrastructure meeting at the White House that the Journal was permitted to attend and report. The newspaper didn’t directly quote Trump’s inquiry about spectrum auctions. A White House spokeswoman wouldn't offer further updates or details Thursday, and NAB declined comment. Broadcast spectrum was the subject of the FCC's latest broadcast TV incentive auction. Trump met Monday with FCC Chairman Ajit Pai (see 1703060055). The administration hasn't released any details of the infrastructure plan or indicated how it would pay for it.

A senior Senate Republican sees potential for spectrum auctioning to be a part of the infrastructure efforts. “I haven’t been part of those discussions yet, but that’s a possibility,” Senate Commerce Committee Chairman John Thune, R-S.D., said in an interview Thursday of a new auction. “That’s how it’s happened in the past.”

“It’s March -- this is usually the month I get a phone call from someone in the federal government saying, ‘We need money out of spectrum,’” said David Redl, chief telecom counsel for House Commerce Committee Republicans, citing getting such a call this time every year for six years on House Commerce. “What are the prospects? Honestly, I don’t know.” He spoke Thursday during an FCBA luncheon. Over the past six years, lawmakers have gone after the “easy stuff” to “put into statute,” with the “lower hanging fruit” of the 2012 Spectrum Act and then “again doubling down” as part of the 2015 budget law, said Redl. “Every time, we push the window out just a little bit further. Realistically, we can’t expect to go back every two years and say to government agencies, ‘Hey, I know we just did this two years ago, let’s rejigger everything one more time.’” Expect more information later in the year, Redl said. “We’re trying to take a more comprehensive look.”

Spectrum auctions “are reliable money makers as Americans have an insatiable demand for wireless voice and data services,” emailed Recon Analytics analyst Roger Entner. “A new spectrum auction would be a bipartisan way to pay for some of the infrastructure programs that the President envisions. I think there is bipartisan support to release more licensed and unlicensed spectrum.”

A Democratic House staffer questioned how much of an offset an auction would really provide. Lawmakers long objected to elements of Congressional Budget Office scoring of spectrum proposals. Those numbers tend to underestimate the returns, the staffer said, suggesting there might be an expected CBO score of no more than $1 billion to $5 billion. Even if an auction earned tens of billions of dollars, that amount is still a fraction of a $1 trillion price tag for an infrastructure proposal, the staffer said.

House Republicans plan to revive the broadband deployment proposals they considered last Congress, which never advanced into law, said Redl, arguing that broadband should be part of Trump's infrastructure plan. Redl is considered a leading contender to become NTIA administrator and has met with Commerce Secretary Wilbur Ross about the position (see 1703060047). This would give him a direct role over such siting and spectrum issues.

“We’re working on a draft bill that doubles down on many of the efforts the subcommittee made last year to accelerate the permitting process so that companies are allocating their resources to trenching fiber, attaching antennas and constructing towers,” Redl said at the FCBA event. “Our bill last Congress proposed establishing an easily searchable federal assets for antennas and other network attachments. It proposed a dedicated point person for each federal agency tasked with improving the permitting process so that companies can use the resources that are out there. And it proposed that federal land management agencies hold themselves to a shot clock and standardize their permitting procedures in a manner that would offer broadband network providers certainty in deployment timelines.”

Redl spoke in place of House Communications Subcommittee Chairman Marsha Blackburn, R-Tenn., who was unable to attend. Pai and Commissioner Mike O’Rielly were among its attendees. Redl is believed to have recused himself from dealing on House Commerce’s NTIA reauthorization efforts due to his application to lead NTIA. But in delivering Blackburn’s message, he described NTIA reauthorization goals in detail. “It’s time to set the goal posts accordingly,” Redl said, calling for NTIA to make more efficient use of government spectrum and freeing more for industry. “Our goal is to cultivate a stronger coordinating role for NTIA and support its efforts to encourage deployment and streamlining federal permitting and improving access to federal rights of way.” During an NTIA reauthorization hearing, subcommittee lawmakers considered whether to elevate the authority of NTIA administrator to subcabinet level. A House Commerce spokesman didn’t comment Thursday on what standards of recusal may apply.

Blackburn intends a “step-by-step approach” to Communications Act overhaul, Redl said. His initial thought during a 2014 rewrite attempt would have been to “do a big bill,” but the thought now is to “take a look at individual pieces” revisiting telecom law and “aggregate them up and move forward,” Redl said. He cited an attempt last year to package eight noncontroversial telecom bills and package them using the Senate’s S-253 legislation as a vehicle. “We’re trying to find as many of those as possible,” Redl said. Last month, Blackburn said the House lacked the capacity to revisit the act in 2017 but may do so next year (see 1702080076).