109 HR 2512 IH: Digital Opportunity Investment Trust Act U.S. House of Representatives 2005-05-19 text/xml EN Pursuant to Title 17 Section 105 of the United States Code, this file is not subject to copyright protection and is in the public domain.

I 109th CONGRESS 1st Session H. R. 2512 IN THE HOUSE OF REPRESENTATIVES May 19, 2005 Mr. Regula (for himself, Mr. Markey, and Mr. Gillmor) introduced the following bill; which was referred to the Committee on Energy and Commerce, and in addition to the Committee on Education and the Workforce, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned A BILL To provide for the establishment of a Digital Opportunity Investment Trust.

1.

Short title

This Act may be cited as the Digital Opportunity Investment Trust Act.

2.

Findings

The Congress finds the following: (1)The United States stands to benefit in the global economy by reallocating additional airwave assets to the private sector for innovative wireless services. (2)Congress previously mandated reallocation of over 200 megahertz of frequency spectrum from Government use to the Federal Communications Commission for private sector licensing. (3)This previous reallocation spurred deployment of new digital wireless services, Government action that helped to lower prices, create jobs, and increase consumer choice. (4)In addition, the use of auctions as an efficient mechanism to assign licenses generated funds that were deposited for general revenue purposes in the United States Treasury. (5)Auction proceeds from the competitive bidding for wireless licenses can additionally be utilized to foster the use of educational technology, promote deployment of public telecommunications infrastructure, and establish a self-sustaining trust fund for grants to transform education, skills training, and lifelong learning. (6)While more and more Americans are utilizing electronic tools in every aspect of their lives, a digital divide still remains in many areas of our country and many citizens lack the skill set necessary to compete for jobs in a 21st Century digital economy. (7)Educational preparedness will be critical if the United States is to have a technologically savvy workforce to fuel growth of our high tech economy in the global marketplace. (8)Utilizing spectrum auction proceeds to enhance the use of educational technology and to increase public access to advanced telecommunications underscores our commitment to ensuring that all of our citizens are prepared for the new economy. (9)The creation of a self-sustaining mechanism to make available annual funding for needed public access and educational technology grants is an appropriate use of revenue generated from corporate use of the public's airwaves and consistent with the public interest. (10)A policy that promotes investment in wireless technology and services along with a concomitant investment in the educational, cultural, and telecommunications resources available to all our citizens is in the national economic interest of the United States.

3.

Establishment of Trust Fund

(a)

Amendment

Part I of title III of the Communications Act of 1934 is amended by inserting after section 309 (47 U.S.C. 309) the following new section:

309A.

Digital Opportunity Investment Trust Fund

(a)

Establishment

There is established a nonprofit corporation to be known as the Digital Opportunity Investment Trust (referred to in this Act as the Trust) which shall not be an agency or establishment of the United States Government. The Trust shall be subject to the provisions of this section, and, to the extent consistent with this section, to theDistrict of Columbia Nonprofit Corporation Act (D.C. Code, section 29–501 et seq.). (b)

Funding

(1)

In general

There is established in the Treasury a separate fund to be known as the Digital Opportunity Investment Trust Fund (referred to in this Act as the Trust Fund). The Trust Fund shall contain such amounts as are credited to the Trust Fund under paragraph (2) and any interest earned on the investment of amounts in the Trust Fund under subsection (g). (2)

Deposit of funds

The Trust Fund shall be credited with the amounts specified in— (A)section 309(j)(8)(E) of this Act; and (B)section 118(d)(3) of the National Telecommunications and Information Administration Organization Act. (c)

Board of Directors; functions, and duties

(1)

In general

A board of directors of the Trust (referred to in this Act as the Board) shall be established to oversee the administration of the Trust. Such Board shall consist of 9 members to be appointed by the President, who— (A)reflect representation from the public and private sectors; (B)are not regular full-time employees of the Federal Government; (C)are eminent in such fields as telecommunications, information technology, labor and workforce development, education, cultural and civic affairs, or the arts and humanities; and (D)shall provide, as nearly as practicable, a broad representation of various regions of the United States, various professions and occupations, and various kinds of talent and experience appropriate to the functions and responsibilities of the Trust. (2)

Recommendations

The Majority Leader of the Senate, the Minority Leader of the Senate, the Speaker of the House of Representatives, and the Minority Leader of the House of Representatives shall submit to the President recommendations of individuals to serve as members of the Board. (3)

Terms of appointment

(A)

Date

Members of the Board shall be appointed not later than 90 days after the date of enactment of this Act. (B)

Terms

(i)

In general

Except as provided in clause (ii), each member of the Board shall be appointed for a 3-year term with terms set to expire in non-Federal election years. (ii)

Staggered terms

With respect to the initial members of the Board— (I)3 members shall serve for a term of 3 years; (II)3 members shall serve for a term of 2 years; and (III)3 members shall serve for a term of 1 year. (C)

Vacancies

A vacancy in the membership of the Board shall not affect the Board’s powers, and shall be filled in the same manner as the original member was appointed. (4)

Chair and vice-chair

(A)

Selection

The Board shall select, from among the members of the Board, an individual to serve for a 2-year term as Chair of the Board and an individual to serve for a 2-year term as vice-Chair of the Board. (B)

Consecutive terms

An individual may not serve for more than 3 consecutive terms as Chair of the Board. (5)

Meetings

(A)

First meeting

Not later than 30 days after the date on which all of the members of the Board have been appointed by the President, the Chair of the Board shall call the first meeting of the Board. (B)

Quorum

A majority of the members of the Board shall constitute a quorum, but a lesser number of members may hold hearings. (6)

Board personnel matters

(A)

Compensation

Members of the Board shall not receive compensation, allowances, or benefits by reason of the members’ service on the Board. (B)

Travel expenses

The members of the Board shall be allowed travel expenses, including per diem in lieu of subsistence, at rates authorized for employees of agencies under subchapter I of chapter 57 of title 5, United States Code, while away from their homes or regular places of business in the performance of services for the Board. (C)

Salaries and expenses

No officer or employee of the Trust may be compensated by the Trust at an annual rate of pay which exceeds the rate of basic pay in effect for level I of the Executive Schedule under section 5312 of Title 5, United States Code. (7)

Director

A majority of the members of the Board shall select a Director of the Trust who shall serve at the discretion of the Board and shall be responsible for instituting procedures to carry out the policies and priorities established by the Board, and for hiring all personnel of the Trust. (8)

Additional requirements and limitations

(A)

Fidelity

No individual other than a citizen of the United States may be an officer of the Trust. No officer of the Trust may receive any salary or other compensation (except for compensation for services on boards of directors of other organizations that do not receive funds from the Trust, on committees of such boards, and in similar activities for such organizations) from any sources other than the Trust for services rendered during the period of his or her employment by the Trust. Service by any officer on boards of directors of other organizations, on committees of such boards, and in similar activities for such organizations shall be subject to annual advance approval by the Board and subject to the provisions of the Trust's Statement of Ethical Conduct. All officers shall serve at the pleasure of the Board. (B)

Nonpartisanship

No political test or qualification shall be used in selecting, appointing, promoting, or taking other personnel actions with respect to officers, agents, and employees of the Trust. The Trust may not contribute to or otherwise support any political party or candidate for elective public office. (C)

Nonprofit nature of the trust

The Trust shall have no power to issue any shares of stock, or to declare or pay any dividends. No part of the income or assets of the Trust shall inure to the benefit of any director, officer, employee, or any other individual except as salary or reasonable compensation for services. (d)

Trust Fund uses

(1)

Uses of funds

To achieve the objectives of this Act, the Director of the Trust, after consultation with the Board, may use Trust funds— (A)to help underwrite the digitization of the collections in the Nation’s universities, museums, libraries, public broadcasting stations, and cultural institutions; (B)to support basic and applied research, development, and demonstrations of innovative learning and assessment systems as well as the components and tools needed to create them; and (C)to use the research results developed under subparagraph (B) to create prototype applications designed to meet learning objectives in a variety of subject areas and designed for learners with many different educational backgrounds, including— (i)strengthening instruction in reading, science, mathematics, history, and the arts in elementary and secondary schools, particularly in academically struggling school districts; (ii)providing the training needed for people now in the workplace to advance in a constantly changing work environment; (iii)training needed for teachers to utilize new tools and technologies in the classroom; and (iv)instruction in community centers, libraries, community colleges, universities, other institutions of higher education, and through public television and radio stations; (v)supporting projects that enhance the access of individuals with disabilities to advanced telecommunications services; and (vi)supporting after-school programs with youths focused on computer literacy and education. (2)

Contracts and grants

(A)

In general

In order to carry out the activities described in paragraph (1), the Director of the Trust, with the agreement of a majority of the members of the Board, may award contracts and grants to nonprofit organizations and public institutions (with or without private partners). (B)

Public domain

(i)

In general

The research and development properties and materials associated with a project in which a majority of the funding used to carry out the project is from a grant or contract under this Act shall be freely and nonexclusively available to the general public in a timely manner. (ii)

Exemption

The Director of the Trust may exempt specific projects from the requirement of clause (i) if the Director of the Trust and a majority of the members of the Board determine that the general public will benefit significantly due to the project not being freely and nonexclusively available to the general public in a timely manner. (C)

Peer review

To the extent practicable, proposals for grants or contracts shall be evaluated on the basis of comparative merit by panels of experts who represent diverse interests and perspectives, and who are appointed by the Director of the Trust from recommendations from the fields served and from the Board of Directors. (e)

Special account for distribution to educational television stations

(1)

Reservation

An amount equivalent to 21 percent of the interest derived from the investment proceeds of the amounts deposited in the Trust Fund under section 309(j)(8)(E) of this Act shall be reserved in a special account within the Trust Fund for distribution on a regular basis to those noncommercial educational television broadcast stations (as defined in section 397(6) of this Act that are qualified to receive grants from the Corporation for Public Broadcasting pursuant to section 396(k)(6)(B) of this Act and to the Public Broadcasting Service in partnership with such stations. (2)

Responsibility for distribution

The Director of the Trust shall— (A)through a special contract, designate the Corporation for Public Broadcasting as the sole agent responsible for the distribution of funds under this section; and (B)transfer the funds referred to in paragraph (1) to the Corporation for Public Broadcasting on a regular basis. (3)

Grants

In making the distribution referred to in paragraph (1), the Corporation for Public Broadcasting shall utilize a competitive grant application process that is governed by criteria that ensures that funds are directed to the creation of locally delivered digital education and learning services, ensures the diversity of licensee types, and ensures that geographic service areas are adequately served. The Corporation for Public Broadcasting shall develop such criteria in consultation with public television licensee permittees and representatives designated by their national organizations. (f)

Accountability and reporting

(1)

Report

(A)

In general

Not later than April 30 of each year, the Director of the Trust shall prepare a report for the preceding fiscal year that contains the information described in subparagraph (B). (B)

Contents

A report under subparagraph (A) shall include— (i)a comprehensive and detailed report of the Trust’s operations, activities, financial condition, and accomplishments, and such recommendations as the Director of the Trust determines appropriate; (ii)a comprehensive and detailed inventory of funds distributed from the Trust during the fiscal year for which the report is being prepared; and (iii)an independent audit of the Trust Fund’s finances and operations, and of the implementation of the goals established by the Board. (C)

Statement of the Board

Each report under subparagraph (A) shall include a statement from the Board containing— (i)a clear description of the plans and priorities of the Board for the subsequent 5-year period for expenditures from the Trust Fund; and (ii)an estimate of the funds that will be available for such expenditures from the Trust Fund. (D)

Submission to the President and Congress

A report under this subsection shall be submitted to the President and the Committee on Energy and Commerce of the House of Representatives and the Committee on Commerce, Science, and Transportation of the Senate. (2)

Testimony

The Director and principal officers of the Trust shall testify before the appropriate committees of Congress, upon request of such committees, with respect to— (A)a report prepared under paragraph (1)(A); and (B)any other matter that such committees may determine appropriate. (g)

Investment of Trust Funds

(1)

In general

The Secretary of the Treasury, after consultation with the Director of the Trust, shall invest the funds of the Trust in interest-bearing obligations of the United States or in obligations guaranteed as to both principal and interest by the United States. (2)

Expenditures

(A)

In general

The Director of the Trust shall not undertake grant or contract activities under this Act until the Trust has received the interest or other proceeds from the investment of the Trust Funds for not less than 1 year’s duration. Thereafter, upon Board approval of the annual budget of the Trust, the Director of the Trust may commence such grant or contract activities at the start of each fiscal year. (B)

Obligation of funds

(i)

In general

Except as provided in clauses (ii) and (iii), in awarding grants or contracts or making other expenditures under this Act, the Director of the Trust shall not obligate funds from the Trust that exceed the proceeds received from the investment of the funds in the Trust Fund during the preceding fiscal year. (ii)

Carry over

Funds from the Trust Fund that are available for obligation for a fiscal year that are not obligated for such fiscal year shall remain available for obligation for the succeeding fiscal year. (iii)

Availability for audit

A portion of the proceeds received from the investment of the funds in the Trust Fund during any fiscal year shall be available for the conduct of the audit for such fiscal year required by subsection (f)(1)(B)(iii). (h)

Use of funds subject to appropriations

The authority to make grants or enter into contracts or otherwise to expend funds under this section is subject to such amounts as are provided in advance in appropriations Acts.

. (b)

Conforming amendments

(1)

Communications Act of 1934

Section 309(j)(8) of the Communications Act of 1934 (47 U.S.C. 309(j)(8)) is amended— (A)in subparagraph (A), by striking subparagraph (B) or subparagraph (D) and inserting subparagraph (B), (D), or (E); and (B)by adding at the end the following new subparagraph: (E)

Additional disposition

Except as provided in subparagraph (D), 30 percent of the cash proceeds of each auction completed after September 30, 2007, and through the last quarter of fiscal year 2027, shall be deposited in the Digital Opportunity Trust Fund established under section 309A of this Act, and shall be available in accordance with that section.. (2)

NTIAO Act

Paragraph (3) of section 118(d) of the National Telecommunications and Information Administration Organization Act is amended to read as follows: (3)

Transfer of unused funds

Any auction proceeds in the Fund that are remaining after the payment of the relocation costs that are payable from the Fund shall, not later than 8 years after the date of the deposit of such proceeds to the Relocation Trust Fund, be transferred to the Digital Opportunity Trust Fund established under section 309A of this Act, and shall be available in accordance with that section..