WASHINGTON-President Clinton last week proposed levying $200 million in analog broadcast spectrum lease fees this year to fund upgrades of federal public safety wireless systems as part of a technology-weighted, $1.84 trillion budget for 2001.
The broadcast lease fee initiative drew a swift rebuke from the powerful broadcast lobby.
“The Clinton administration proposal would jeopardize a public-private partnership between government and free, over-the-air local broadcasters that dates back to the 1934 Communications Act,” said Edward Fritts, president of the National Association of Broadcasters.
Fritts, noting broadcasters two years ago provided $6.8 billion in annual public service programming and fund raising for local charities, said for the White House to suggest that level of public service “is somehow inadequate for use of a sliver of the spectrum is nothing short of sheer folly.”
Broadcasters, which enjoy the political benefit of having TV stations in every lawmaker’s district, have killed previous attempts by the White House to assess fees on broadcast spectrum.
But the administration appears to have bought political cover this time by linking its analog spectrum lease fee proposal to a public safety initiative.
The cellular industry did much the same by getting limited liability protection for carriers and vendors in legislation touted as a wireless 911 public safety bill last year.
In recent years, skepticism has grown that broadcasters will not relinquish their six-megahertz analog channels after converting to digital technology. Indeed, the rollout of digital TV is occurring slower than federal regulators would like.
In budgetary and political contexts, the situation creates a dilemma for the Office of Management and Budget and Clinton. OMB anticipates raising more than $20 billion from spectrum auctions during the next 10 years. Uncertainty about the availability of analog TV spectrum (which accounts for a big chunk of the $20 billion-plus because of its quantity and quality) complicates budgetary and political planning for the administration.
Sabre rattling between the administration and the GOP-controlled Congress over the president’s 2001 budget began in earnest last week in this year of presidential and congressional elections.
Each side wants to get as much political mileage as possible from the budget battle. The Republicans want a big tax cut, while the Democrats-seeking to reclaim the House of Representatives and retain the White House-support spending for popular social programs and paying down the national debt.
The debate is driven by how to spend the huge, multibillion dollar budget surplus, but it is complicated by differences about just how large the surplus actually is or will be several years from now.
Because of the money at stake, the White House’s analog spectrum lease fee could resonate with Republicans and Democrats alike.
Some of the $200 million minimum the administration is counting on from analog broadcast lease fees in fiscal 2001 will help offset increasing funding for federal public safety communications. The money will help pay for mandated Justice Department accelerated conversion to narrowband communications and for other wireless-related expenditures.
State and local public safety agencies will not be able to tap into the $200 million fund.
“What I continue to hear from public safety officials is there’s an urgent need for funds,” said Kathleen Wallman, who heads the national committee responsible for coordinating the migration of public safety radio systems to new 700 MHz spectrum.
Wallman said a working group has been organized to look into funding issues.
On a related front, the president proposed a $105 million increase (over last year’s $15 million request) for the Justice Department to reimburse wireless carriers and others for making digital wiretap upgrades under the Communications Assistance for Law Enforcement Act of 1994.
Another $120 million for CALEA is included in the Pentagon’s budget, making for $240 million in total CALEA-requested funding for 2001.
The Defense Department, according to Clinton’s budget plan, can use the funds to repay Justice for CALEA payments to the telecommunications industry.
The president’s budget plan seeks $237 million for the Federal Communications Commission and $20 million for the National Telecommunications and Information Administration. The president has requested $45 million for information infrastructure technology grants.
Another $175 million has been set aside by the White House to help bridge the “Digital Divide” by connecting low-income households to the Internet and to promote e-commerce in general.
Unlike past years, the new Clinton budget does not include proposed legislation to enable the FCC to retrieve licenses from bankrupt wireless firms.
Early indications are that a bureaucratic snafu, created in part over confusion about the status of wireless bankruptcy litigation, resulted in the omission of the provision. Its absence in Clinton’s 2001 budget could make it more difficult for FCC Chairman William Kennard to sell the bankruptcy change on Capitol Hill this year.
The Clinton budget plan signals the administration is more optimistic than it was previously about collecting some of the $10 billion pledged in the 1996 C-block personal communications services auction by top bidders that subsequently filed for bankruptcy.
White House budgeteers now expect to collect about $1.8 billion more than what they previously believed they could collect for licenses awarded to C-block personal communications services firms that pay on an installment basis.
Clinton’s budget also is seeking congressional approval for buyouts of federal workers, a proposal that could give agency heads more of a hand in downsizing rather then being at the mercy of lawmakers.
The $10 million in mobile phone cancer research that Sen. Patrick Leahy (D-Vt.) had sought was not included in the President’s budget. However, a Leahy aide said that funding will be a high priority of the Vermont lawmaker, who is a senior member of the Senate Appropriations Committee.
