[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[S. 2075 Introduced in Senate (IS)]







107th CONGRESS
  2d Session
                                S. 2075

  To facilitate the availability of electromagnetic spectrum for the 
  deployment of wireless based services in rural areas, and for other 
                               purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             April 9, 2002

  Mr. Baucus introduced the following bill; which was read twice and 
   referred to the Committee on Commerce, Science, and Transportation

_______________________________________________________________________

                                 A BILL


 
  To facilitate the availability of electromagnetic spectrum for the 
  deployment of wireless based services in rural areas, and for other 
                               purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Rural Electromagnetic Spectrum 
Access Act of 2002''.

SEC. 2. FINDINGS AND PURPOSE.

    (a) Findings.--Congress makes the following findings:
            (1) The Federal Communications Commission routinely uses 
        competitive bidding to distribute electromagnetic spectrum to 
        the public sector.
            (2) In establishing and carrying out competitive bidding to 
        distribute spectrum, the Commission fails to ensure the bidding 
        process results in upholding the clear meaning of the law 
        guaranteeing rural telephone companies and rural areas the 
        ability to effectively participate in and benefit from such a 
        method of distributing the spectrum.
            (3) The approach of the Commission to competitive bidding 
        for the distribution of spectrum ensures, for the most part, 
        that entities with significant financial strength, or 
        organizations that are backed by such entities, acquire a 
        majority of available licenses while rural telephone companies 
        lacking significant resources are denied their statutory right 
        to effectively participate in the competitive bidding.
            (4) The Commission, through a broadbrush application of its 
        rules to all potential bidders for electromagnetic spectrum 
        licenses, routinely fails to ensure that small businesses, 
        rural telephone companies, and businesses owned by members of 
        minority groups and women, individually and independent of one 
        another, enjoy the statutorily mandated opportunity to 
        participate in bidding for such licenses, and ultimately to 
        acquire such licenses.
            (5) The approach of the Commission to resolving such 
        inequities--through post-auction methods such as disaggregation 
        and partitioning of licenses and the establishment of build-out 
        requirements which do not in fact require service to rural 
        areas--fails to meet the statutory mandate of equitable, 
        effective, and prompt distribution of spectrum licenses and 
        related services.
            (6) The approach of the Commission to competitive bidding 
        for the distribution of spectrum results in excessive 
        concentration of licenses among a few licensees, leading to 
        timely deployment in urban areas and a delay or denial of 
        service in rural areas.
            (7) The economic and national security of the United States 
        requires that any competitive bidding for the distribution of 
        the spectrum should--
                    (A) provide for the wide dissemination of licenses 
                among a wide variety of applicants, including rural 
                telephone companies;
                    (B) be equitable, effective, and prompt;
                    (C) result in the acquisition of licenses by a wide 
                variety of applicants, including rural telephone 
                companies;
                    (D) promote the rapid deployment of spectrum-based 
                services in rural areas served by rural telephone 
                companies.
    (b) Purpose.--It is the purpose of this Act to require that the 
Commission take immediate steps to ensure that its competitive bidding 
systems distribute electromagnetic spectrum in a manner that complies 
completely with the clear meaning of section 309(j) of the 
Communications Act (47 U.S.C. 309(j)), including the provisions of that 
section that ensure that particular attention is given to the ability 
of rural telephone companies to participate in competitive bidding to 
distribute spectrum.

SEC. 3. AVAILABILITY OF ELECTROMAGNETIC SPECTRUM FOR WIRELESS BASED 
              SERVICES IN RURAL AREAS.

    (a) Restatement of Certain Authority on Competitive Bidding With 
Requirements on Wireless Based Services in Rural Areas.--Section 309(j) 
of the Communications Act of 1934 (47 U.S.C. 309(j)) is amended by 
striking paragraphs (3) and (4) and inserting the following new 
paragraphs (3) and (4):
            ``(3) Geographic area licensing.--
                    ``(A) In general.--In order to facilitate the 
                deployment of wireless based services in rural areas, 
                the Commission shall, when more  than one license is 
available (as determined by the Commission) within a single block of 
the electromagnetic spectrum, award at least one license in such block 
of spectrum for a rural service area (RSA) or similarly sized 
geographic area.
                    ``(B) Construction of requirement.--Nothing in 
                subparagraph (A) shall be construed to prohibit the 
                Commission from--
                            ``(i) awarding spectrum for any particular 
                        rural service area or similarly sized 
                        geographic area in addition to the spectrum 
                        awarded under that paragraph; or
                            ``(ii) making spectrum available for rural 
                        service areas or similarly sized geographic 
                        areas when only one license is available within 
                        a single block of spectrum.
            ``(4) Ensuring public access to spectrum.--
                    ``(A) In general.--For each class of licenses or 
                permits that the Commission grants through the use of a 
                competitive bidding system, the Commission shall, by 
                regulation, establish a competitive bidding 
                methodology. The Commission shall seek to design and 
                test multiple alternative methodologies under 
                appropriate circumstances. The Commission shall, 
                directly or by contract, provide for the design and 
                conduct (for purposes of testing) of competitive 
                bidding using a contingent combinatorial bidding system 
                that permits prospective bidders to bid on combinations 
                or groups of licenses in a single bid and to enter 
                multiple alternative bids within a single bidding 
                round. In identifying classes of licenses and permits 
                to be issued by competitive bidding, in specifying 
                eligibility and other characteristics of such licenses 
                and permits, and in designing the methodologies for use 
                under this subsection, the Commission shall include 
                safeguards to protect the public interest in the use of 
                the spectrum.
                    ``(B) Avoiding excessive concentration of 
                licenses.--The Commission shall seek to promote the 
                purposes of paragraphs (1) and (2) and the following 
                objectives:
                            ``(i) The development and rapid deployment 
                        of new technologies, products, and services for 
                        the benefit of the public, including those 
                        residing in rural areas, without administrative 
                        or judicial delays.
                            ``(ii) Promoting economic opportunity and 
                        competition and ensuring that new and 
                        innovative technologies are readily accessible 
                        to the American people by avoiding excessive 
                        concentration of licenses and by disseminating 
                        licenses among a wide variety of applicants, 
                        including small businesses, rural telephone 
                        companies, and businesses owned by members of 
                        minority groups and women.
                            ``(iii) Recovery for the public of a 
                        portion of the value of the public spectrum 
                        resource made available for commercial use and 
                        avoidance of unjust enrichment through the 
                        methods employed to award uses of that 
                        resource.
                            ``(iv) Efficient and intensive use of the 
                        electromagnetic spectrum.
                            ``(v) Ensuring that, in the scheduling of 
                        any competitive bidding under this subsection, 
                        an adequate period is allowed--
                                    ``(I) before issuance of bidding 
                                rules, to permit notice and comment on 
                                proposed auction procedures; and
                                    ``(II) after issuance of bidding 
                                rules, to ensure that interested 
                                parties have a sufficient time to 
                                develop business plans, assess market 
                                conditions, and evaluate the 
                                availability of equipment for the 
                                relevant services.
                    ``(C) Availability of wireless based services in 
                rural areas.--
                            ``(i) Studies.--Not later than 12 months 
                        after the date of the enactment of the Rural 
                        Electromagnetic Spectrum Access Act of 2002, 
                        and every 24 months thereafter, the Commission 
                        shall conduct a study to determine the 
                        following:
                                    ``(I) The extent to which licenses 
                                and permits have been awarded to 
                                facilitate the deployment of wireless 
                                based services in rural areas.
                                    ``(II) The extent to which licenses 
                                and permits for wireless based services 
                                have been awarded to small businesses, 
                                rural telephone companies, and 
                                businesses owned by minority groups or 
                                women.
                                    ``(III) The extent to which 
                                wireless based services are available 
                                in rural areas pursuant to licenses and 
                                permits referred to in subclauses (I) 
                                and (II).
                            ``(ii) Report.--The Commission shall submit 
                        to Congress a report on each study conducted 
                        under clause (i).
                            ``(iii) Actions.--If the Commission 
                        determines as a result of a study under clause 
                        (i) that financial or regulatory barriers are 
                        impeding the availability of wireless based 
                        services in rural areas (whether through 
                        limitation on the capacity of eligible entities 
                        to bid for licenses or permits, limitation on 
                        the capacity of licensees or permittees to 
                        deploy wireless based services, or otherwise), 
                        the Commission shall, to the maximum extent 
                        practicable, take appropriate actions to remove 
                        such barriers.
                    ``(D) Design of systems of competitive bidding.--In 
                prescribing regulations pursuant to subparagraph (A), 
                the Commission shall--
                            ``(i) consider alternative payment 
                        schedules and methods of calculation, including 
                        lump sums or guaranteed installment payments, 
                        with or without royalty payments, or other 
                        schedules or methods that promote the 
                        objectives described in subparagraph (B)(ii), 
                        and combinations of such schedules and methods;
                            ``(ii) develop requirements, including 
                        deadlines and penalties, for the prompt 
                        delivery of wireless based services to rural 
                        areas in order to prevent the stockpiling or 
                        warehousing of spectrum by licensees or 
                        permittees;
                            ``(iii) consistent with the public 
                        interest, convenience, and necessity, the 
                        purposes of this Act, and the characteristics 
                        of the proposed service, prescribe area 
                        designations and bandwidth assignments that 
                        promote (I) an equitable distribution of 
                        licenses and services among geographic areas, 
                        (II) economic opportunity for a wide variety of 
                        applicants, including small businesses, rural 
                        telephone companies, and businesses owned by 
                        members of minority groups and women, and (III) 
                        investment in and rapid deployment of new 
                        technologies and services;
                            ``(iv) ensure that small businesses, rural 
                        telephone companies, and businesses owned by 
                        members of minority groups and women are all 
                        given the opportunity to participate in the 
                        provision of spectrum-based services, and, for 
                        such purposes, consider the use of tax 
                        certificates, bidding preferences, bidding 
                        credits, and other procedures;
                            ``(v) require such transfer disclosures and 
                        antitrafficking restrictions and payment 
                        schedules as may be necessary to prevent unjust 
                        enrichment as a result of the methods employed 
                        to issue licenses and permits; and
                            ``(vi) prescribe methods by which a 
                        reasonable reserve price will be required, or a 
                        minimum bid will be established, to obtain any 
                        license or permit being assigned pursuant to 
                        the competitive bidding, unless the Commission 
                        determines that such a reserve price or minimum 
                        bid is not in the public interest.
                    ``(E) Facilitation of deployment of wireless based 
                services in rural areas.--
                            ``(i) Reports on deployment.--The 
                        Commission shall require each licensee or 
                        permittee of a license or permit granted under 
                        this subsection to submit to the Commission 
                        each year a map or other analysis showing the 
                        following:
                                    ``(I) The area covered by the 
                                license or permit.
                                    ``(II) The portions of such area in 
                                which infrastructure to provide 
                                wireless based services under the 
                                license or permit is in place, and such 
                                services are commercially available.
                            ``(ii) Deployment through first half of 
                        license period.--Not later than the end of the 
                        first half of the period of a license or permit 
                        granted under this subsection for the 
                        deployment of services to a rural service area, 
                        or a similarly sized geographic area within a 
                        larger license or permit area, the Commission 
                        shall, utilizing maps or other analysis under 
                        clause (i), determine whether or not the 
                        licensee or permittee--
                                    ``(I) has made wireless based 
                                services available throughout such 
                                rural service area or similar 
                                geographic area, as the case may be; or
                                    ``(II) has demonstrated a 
                                commitment to provide wireless based 
                                services in such rural service area or 
                                similarly sized geographic area, as the 
                                case may be, in a substantial portion 
                                of such area.
                            ``(iii) Substantial portion.--For purposes 
                        of clause (ii), a substantial portion of an 
                        area shall consist of both, taking into 
                        account--
                                    ``(I) the geographic portion of 
                                such area that is capable of receiving 
                                the services to be available through 
                                the license or permit; and
                                    ``(II) the portion of the 
                                population residing in such area who 
                                would be capable of receiving such 
                                services.
                            ``(iv) Action on negative determinations.--
                        If the Commission determines under clause (ii) 
                        that a licensee or permittee has not satisfied 
                        either of the actions described by subclauses 
                        (I) and (II) of that clause in a rural service 
                        area or similarly sized geographic area, the 
                        Commission shall permit a party which petitions 
                        the Commission to provide wireless based 
                        services in such area to provide such services 
                        in such area. In the absence of such a petition 
                        with respect to an area, the Commission shall 
                        make such services available to the public in 
                        such area through mandatory partitioning of 
                        such area, the disaggregation of the portion of 
                        such area that is unserved by wireless based 
                        services from the license or permit, or both.
                            ``(v) Deployment through end of license 
                        period.--If at the end of the period of a 
                        license or permit granted under this subsection 
                        for the deployment of wireless based services 
                        to a rural service area, or a similarly sized 
                        geographic area within a larger license or 
                        permit area, the Commission determines that 
                        such services are not available in such rural 
                        service area or similarly sized geographic 
                        area, as the case may be, the Commission will 
                        reclaim such license or permit and, subject to 
                        clause (vi), make such license or permit 
                        available through use of a competitive bidding 
                        system under this subsection.
                            ``(vi) Preference for original licensees.--
                        In the case of an action under clause (iii) or 
                        (iv), the Commission may grant the right of 
                        first refusal to the original licensee or 
                        permitee, as the case may be, if the Commission 
                        determines that such licensee or permittee has 
                        in place an appropriate plan for the immediate 
                        and complete deployment of wireless based 
                        services in the area covered by the action 
                        under such clause.''.
    (b) Conforming Amendments.--Paragraph (7) of that section is 
amended--
            (1) in subparagraph (A), by striking ``paragraph (4)(C)'' 
        and inserting ``paragraph (4)(D)(iii)''; and
            (2) in subparagraph (B), by striking ``paragraph (4)(A)'' 
        and inserting ``paragraph (4)(D)(i)''.
                                 <all>