Lawmakers Question FCC’s Decision to Hold 2.5 GHz Licenses

Reinstating the FCC’s auction authority, fully funding Rip & Replace and spending broadband infrastructure deployment funding wisely were the main hot topics at yesterday’s FCC oversight hearing. Leaders of the House Communications and Technology Subcommittee noted it’s been more than a year since the Commissioners came before lawmakers on Capitol Hill.

House Energy and Commerce Committee Chair Cathy McMorris Rodgers (R-WA) zeroed in on what lawmakers have been doing to restore the FCC’s auction authority, which expired for the first time ever in March. She said she’s been working with her House and Senate colleagues “for over a year” to extend the authority.

“Earlier this year, the Committee unanimously passed H.R. 3565, the Spectrum Auction Reauthorization Act, to extend the FCC’s auction authority for three years, fund the shortfall in the Rip & Replace program, and support our first responders through upgraded 911 networks,” said Rodgers. “We’re continuing to work on advancing this legislation out of the House, through the Senate, and to the President’s desk to sign.”  

Subcommittee Ranking Member Doris Matsui (D-CA) called the lapse of the FCC’s auction authority “a completely avoidable failure” by lawmakers. “Allowing this [lapse] to continue is unacceptable.”

“I can’t emphasize enough how vital it is that the FCC’s spectrum auction authority is renewed,” said FCC Chairwoman Jessica Rosenworcel.

Lawmakers Rodgers and Anna Eshoo (D-CA) challenged whether the agency really cannot issue licenses won in its 2.5 GHz auction, noting that T-Mobile bid just over $300 million on 7,156 licenses last summer. “It’s stunning to me that someone pays for something they don’t get,” said Eshoo. She noted that four former FCC General Counsels wrote to the agency, saying they believe the Commission has the authority to issue the licenses. Eshoo said the situation “sets a chill in many ways on auctions that have been extraordinarily successful.”

Rosenworcel called the situation “totally unfair,” and said that to the CEO of T-Mobile. “This is an area where the law is extremely clear. We continue to look at every law that we can,” to rectify the situation, Rosenworcel explained.

Rosenworcel added that her other concern is that by issuing the licenses, agency officials could violate the “Anti-Deficiency Act, which is a criminal law.” The Act prohibits federal agencies from spending federal funds in advance or in excess of an appropriation.

The last time the agency was accused of doing this, the Chairwoman explained, the GAO investigated and “FCC employees had to hire lawyers to defend themselves. I don’t want any of that nonsense to happen again.”

Turning to Rip & Replace, Subcommittee Chair Bob Latta (R-OH) asked Commissioner Carr about potential consequences if Congress doesn’t fully fund the program to reimburse small carriers for removing Huawei and ZTE gear from their networks. Carr said, “There will be real-world consequences. We could see small rural ISPs go out of business. Others could stay in business if they leave holes in their coverage.”

Latta, too, cited the full House Energy & Commerce Committee’s passage of HR 3565, which would make up the $3 billion shortfall in Rip & Replace. Latta said lawmakers “have had talks …We’ve got to get this thing done. We need to ensure it gets out of the House and into the Senate.”

Matsui agreed, noting that without additional money the FCC will be forced to pro-rate funding on July 17. “Congress didn’t mandate the removal of some of this gear. We mandated removal of every last piece,” she emphasized.

By Leslie Stimson, Inside Towers Washington Bureau Chief

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