[Senate Hearing 114-407]
[From the U.S. Government Publishing Office]
S. Hrg. 114-407
FIRSTNET OVERSIGHT: AN UPDATE
ON THE STATUS OF THE
PUBLIC SAFETY BROADBAND NETWORK
=======================================================================
HEARING
before the
SUBCOMMITTEE ON COMMUNICATIONS, TECHNOLOGY, INNOVATION, AND THE
INTERNET
of the
COMMITTEE ON COMMERCE,
SCIENCE, AND TRANSPORTATION
UNITED STATES SENATE
ONE HUNDRED FOURTEENTH CONGRESS
SECOND SESSION
__________
JUNE 21, 2016
__________
Printed for the use of the Committee on Commerce, Science, and Transportation
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SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION
ONE HUNDRED FOURTEENTH CONGRESS
SECOND SESSION
JOHN THUNE, South Dakota, Chairman
ROGER F. WICKER, Mississippi BILL NELSON, Florida, Ranking
ROY BLUNT, Missouri MARIA CANTWELL, Washington
MARCO RUBIO, Florida CLAIRE McCASKILL, Missouri
KELLY AYOTTE, New Hampshire AMY KLOBUCHAR, Minnesota
TED CRUZ, Texas RICHARD BLUMENTHAL, Connecticut
DEB FISCHER, Nebraska BRIAN SCHATZ, Hawaii
JERRY MORAN, Kansas EDWARD MARKEY, Massachusetts
DAN SULLIVAN, Alaska CORY BOOKER, New Jersey
RON JOHNSON, Wisconsin TOM UDALL, New Mexico
DEAN HELLER, Nevada JOE MANCHIN III, West Virginia
CORY GARDNER, Colorado GARY PETERS, Michigan
STEVE DAINES, Montana
Nick Rossi, Staff Director
Adrian Arnakis, Deputy Staff Director
Rebecca Seidel, General Counsel
Jason Van Beek, Deputy General Counsel
Kim Lipsky, Democratic Staff Director
Chris Day, Democratic Deputy Staff Director
Clint Odom, Democratic General Counsel and Policy Director
------
SUBCOMMITTEE ON COMMUNICATIONS, TECHNOLOGY, INNOVATION, AND THE
INTERNET
ROGER F. WICKER, Mississippi, BRIAN SCHATZ, Hawaii, Ranking
Chairman MARIA CANTWELL, Washington
ROY BLUNT, Missouri CLAIRE McCASKILL, Missouri
MARCO RUBIO, Florida AMY KLOBUCHAR, Minnesota
KELLY AYOTTE, New Hampshire RICHARD BLUMENTHAL, Connecticut
TED CRUZ, Texas EDWARD MARKEY, Massachusetts
DEB FISCHER, Nebraska CORY BOOKER, New Jersey
JERRY MORAN, Kansas TOM UDALL, New Mexico
DAN SULLIVAN, Alaska JOE MANCHIN III, West Virginia
RON JOHNSON, Wisconsin GARY PETERS, Michigan
DEAN HELLER, Nevada
CORY GARDNER, Colorado
STEVE DAINES, Montana
C O N T E N T S
----------
Page
Hearing held on June 21, 2016.................................... 1
Statement of Senator Wicker...................................... 1
Statement of Senator Schatz...................................... 2
Statement of Senator Gardner..................................... 28
Statement of Senator Daines...................................... 30
Statement of Senator Fischer..................................... 32
Statement of Senator Blumenthal.................................. 36
Statement of Senator Klobuchar................................... 38
Witnesses
Michael Poth, Chief Executive Officer, First Responder Network
Authority (FirstNet)........................................... 3
Prepared statement........................................... 5
Jeffrey S. McLeod, Director, Homeland Security and Public Safety
Division, National Governors Association's Center for Best
Practices...................................................... 9
Prepared statement........................................... 11
Major General Arthur J. Logan, Hawaii Adjutant General, State of
Hawaii......................................................... 14
Prepared statement........................................... 16
Andrew Katsaros, Principal Assistant Inspector General for Audit
and Evaluation, U.S. Department of Commerce Office of Inspector
General........................................................ 18
Prepared statement........................................... 20
Appendix
Hon. Bill Nelson, U.S. Senator from Florida, prepared statement.. 41
Response to written questions submitted to Michael Poth by:
Hon. Kelly Ayotte............................................ 41
Hon. Ron Johnson............................................. 43
Hon. Cory Gardner............................................ 43
Hon. Bill Nelson............................................. 46
Hon. Cory Booker............................................. 47
Hon. Joe Manchin............................................. 48
Hon. Gary Peters............................................. 49
Response to written questions submitted by Hon. Joe Manchin to:
Jeffrey S. McLeod............................................ 51
General Arthur J. Logan...................................... 51
Response to written questions submitted to Andrew Katsaros by:
Hon. Kelly Ayotte............................................ 52
Hon. Joe Manchin............................................. 54
FIRSTNET OVERSIGHT: AN UPDATE
ON THE STATUS OF THE
PUBLIC SAFETY BROADBAND NETWORK
----------
TUESDAY, JUNE 21, 2016
U.S. Senate,
Subcommittee on Communications, Technology,
Innovation, and the Internet,
Committee on Commerce, Science, and Transportation,
Washington, DC.
The subcommittee met, pursuant to notice, at 9:33 a.m. in
room SR-253, Russell Senate Office Building, Hon. Roger Wicker,
Chairman of the Subcommittee, presiding.
Present: Senators Wicker [presiding], Schatz, Gardner,
Daines, Fischer, Klobuchar, Blumenthal, Ayotte, Heller, and
Manchin.
OPENING STATEMENT OF HON. ROGER F. WICKER,
U.S. SENATOR FROM MISSISSIPPI
Senator Wicker. Good morning. I'm glad to convene today's
hearing with my friend and colleague Ranking Member Schatz.
We would like to focus on the progress FirstNet has made
and the challenges that lie ahead in deploying a nationwide
public safety network. The First Responder Network Authority,
also known as FirstNet, was established under the Middle Class
Tax Relief and Job Creation Act of 2012. It is intended to
address communication failures that slowed recovery efforts
during major national emergencies, including the 9/11 attacks
and Hurricane Katrina.
In Mississippi, we saw firsthand the consequences of
communication network breakdown. FEMA, Red Cross, and others
were hindered from providing the emergency recovery services
needed during and after Katrina.
Tasked with building and operating a Nationwide Public
Safety Broadband Network, the 2012 Act allocated $7 billion
from spectrum auction proceeds to launch FirstNet. The AWS-3
spectrum auction, which concluded in January 2015, raised the
$7 billion needed to begin the planning and development stage.
Although FirstNet has made commendable progress in the
first year, questions linger about the future viability of the
network. I appreciate FirstNet's commitment to providing our
rural communities with the same services as larger urban
cities, but rural and remote coverage remains a major concern
of mine.
The cost of coverage and maintenance of the network in
these hard-to-reach areas needs to be addressed on the front
end of deployment. An accurate inventory of towers and
equipment is critical to ensuring that infrastructure is
capable of withstanding 200-mile-per-hour winds during storms
similar to Katrina.
Each region of the country faces a unique set of
challenges, and addressing these challenges is critical to
fulfilling Congress's goal of creating FirstNet. We should
ensure that FirstNet's plan for deployment includes the
technical requirements that may be necessary.
However, we recognize that nationwide deployment will not
occur overnight. Over the next several months, FirstNet will be
reviewing bids to award a contract for all aspects of
deployment. As this process moves forward, I urge FirstNet and
all stakeholders to look carefully at the long-term viability
of the network.
With a limited user base, FirstNet must have the
sophistication to determine who has not only the technical
capacity, but also the ability to monetize the network in order
to keep it running in the future. The costs placed on public
safety entities to use the network are also a major concern
with regard to long-term sustainability.
Last year's oversight hearing examined the progress that
had been made and FirstNet's plan for outreach to stakeholders
in each State and territory. Today, I look forward to hearing
about FirstNet's accomplishment in the past year, what
benchmarks have been met, and what work still needs to be done.
I want to welcome all of our witnesses and thank them for
testifying this morning. Our panel today includes a number of
stakeholders overseeing the deployment process who can help
shed light on the challenges ahead.
Senator Schatz.
STATEMENT OF HON. BRIAN SCHATZ,
U.S. SENATOR FROM HAWAII
Senator Schatz. Thank you, Mr. Chairman. And thank you to
our witnesses. I especially want to offer my welcome to
Hawaii's Adjutant General, General Logan.
We are here today to discuss the progress FirstNet has made
toward creating an interoperable nationwide wireless broadband
network for first responders. In 2012, when Congress created
FirstNet, we made an important commitment to public safety. The
new Federal entity we created is a unique public-private
partnership mandated to deploy this network for first
responders. At the time this legislation was passed, we still
lacked a nationwide interoperable public safety communication
network in spite of the glaring communications problems that
had been exposed following the tragedies of September 11th and
Hurricane Katrina.
Until this network is built, our first responders will have
to carry their bulky land mobile radios for their mission-
critical voice communications and carry around a commercial
smartphone for their data needs. There is really no reason that
a 16-year-old with a smartphone should have more technology at
their fingertips than our first responders.
FirstNet will provide first responders mission-critical
data use for the first time. This network will be built and
hardened to public safety specifications. It will have rugged
eyes and competitive devices and specific public safety
applications. For example, firefighters could download the
blueprint of a burning building before they enter; a police
officer arriving at the scene can run a background check or get
pictures of a suspect by accessing a Federal law enforcement
database; most importantly, emergency personnel will not be
competing with commercial users for bandwidth. They will have
priority on this network.
FirstNet's staff and board should be congratulated for
releasing its RFP earlier this year, which is a real milestone
toward construction of the network. They have received bids and
will be evaluating potential vendors during the next several
months while continuing to work with states on their
participation. As they progress, FirstNet and its commercial
partner will have to make sure that first responders and each
State sees the value in the network.
As General Logan may touch upon today, we need to ensure
that the specific needs of all states and territories are
respected in order to accommodate for geographic and other
differences across our great country.
While Congress will continue to keep a close eye on
FirstNet's work, the reality is that we are in a wait-and-see
mode until FirstNet chooses its private sector partner, and so
I expect that Mr. Poth may not be able to address every issue
raised today, as they are in the middle of a procurement
process. Once the vendor has been chosen, FirstNet and all of
its partners can begin in earnest to build the network that
delivers on the promise that Congress made to public safety in
2012.
Again, I want to thank the witnesses for appearing before
the Committee, and I look forward to hearing your testimony.
Senator Wicker. Thank you, Senator Schatz. Our witnesses
today are Mr. Michael Poth, CEO of FirstNet; Mr. Jeffrey
McLeod, Director of Homeland Security and Public Safety
Division of the National Governors Association; Senator Schatz
has already mentioned Major General Arthur J. Logan, the Single
Point of Contact, State of Hawaii, and the Hawaii Adjutant
General; and, fourthly, Mr. Andrew Katsaros, Assistant
Inspector General for Audit, U.S. Department of Commerce,
Washington, D.C.
Gentlemen, we appreciate all of you being with us today,
and we'll begin with the testimony of Mr. Poth and ask each of
you if you could limit your verbal testimony to 5 minutes.
Thank you.
Mr. Poth.
STATEMENT OF MICHAEL POTH, CHIEF EXECUTIVE OFFICER,
FIRST RESPONDER NETWORK AUTHORITY (FirstNet)
Mr. Poth. Thank you, Chairman Wicker, Ranking Member
Schatz, and Members of the Subcommittee. Thank you for inviting
me to testify today.
Since I began at FirstNet a little over 10 months ago, I've
seen firsthand the dedication that the FirstNet board and staff
have toward the successful deployment of the nationwide public
safety broadband network. Public safety, that's who we work for
every day, and we have never taken our focus off the goal of
delivering the best possible network for the men and women who
keep us safe and put themselves in harm's way every single day.
We are the stewards for their network.
I'd like to take just a moment and thank those public
safety personnel who are in the audience today. Senators, their
presence are an indication that they are keeping all of our
feet to the fire as we work together in making FirstNet a
reality.
We've accomplished a great deal over the past 12 months:
wrapped up our initial consultation meetings with every State
and territory partner who requested one; kicked off 2016
consultation with our single points of contacts meetings,
SPOCs; and are well underway in the State governance board
meetings in coordination with our SPOCs. Then we released the
RFP and are now moving forward aggressively toward award.
It is around the RFP that I would like to focus the
majority of my comments today. When the FirstNet chairwoman,
Sue Swenson, testified before the full committee around 15
months ago, she laid out the roadmap that FirstNet was planning
to move along in order to successfully conduct consultation
with the states and develop a procurement strategy that would
ultimately result in a public-private partnership with the
vendor. FirstNet continues to honor our commitments to do what
we set out to do on time and under budget.
We have to ensure not only that our 16 core objectives,
including rural build-out, cybersecurity, public safety
adoption, and financial sustainability, could be met by the
vendor community, but we had to propose a business opportunity
model that would ultimately be a win for public safety, a win
for the states, a win for FirstNet, and a win for our
commercial partner: a true public-private partnership across
the board.
Based on what we've seen in the past, the financial
incentive was not enough for the commercial community to do
this on their own, and we know that the taxpayer funds are
simply not there to do this by ourselves. In essence, we had to
develop a business proposition that fulfilled the needs of both
parties. In developing the RFP, we met with hundreds of
commercial entities, educating them on the business
proposition, listening to their concerns, while trying to
establish best methods and bringing the commercial world to the
table.
We're in the marketing mode to create the demand. In the
buildup to the release, FirstNet held numerous industry days,
informational sessions with the investment community,
educational webinars for the vendor community, and public
speaking engagements on both the draft RFP documents and the
final RFP.
Ultimately, after a year of intense work, we were able to
release the RFP back in January of this year. The RFP was open
to the vendor community for a little over 5 months, and was
closed on this May 31st. We are confident that the RFP will
lead to the successful public-private partnership that Congress
envisioned.
We're also confident the value proposition we have put
forward will enable our partner to achieve the public safety
user adoption targets, the coverage goals, the price points,
and financial sustainability that we need. We will maximize the
value of the $7 billion and the 20 megahertz spectrum that
Congress and the American taxpayer provided FirstNet.
We also know that the public safety user base exists, and
``user adoption targets'' will become a contract term. We have
designed the RFP to incentivize our partner to achieve the
goals, and so we are allowing the market to work in both our
and public safety's advantage. We have structured financial
safeguards and operational oversight controls over our partner
to ensure that we have the ability to keep them accountable
throughout the duration of the contract.
Today, we are in the evaluation phase of the project. Due
to the rules that the Federal Acquisition Regulations, or FAR,
places on FirstNet, I cannot comment on any aspects of the
current actions of the organization related to the procurement.
In 2016, we still continue consultation efforts with the
States, conduct outreach with State, local, tribal, and Federal
public safety agencies. We will select the partner from the
procurement phase of the project and begin development of the
State plans. Our previously established partnerships with the
states will be critical for this phase of the effort.
While we are proud of our efforts thus far, we cannot
afford to rest for one moment. Too much work needs to be done.
Public safety has long been demanding a broadband network, and
now we are in reach of achieving this goal. The men and women
who protect us from harm's way are counting on us to deliver
the network, and we must do so for the sake of all first
responders around the country. The need for this network has
never been higher, and in order to meet the lofty expectations
of public safety everywhere, I and the organization is
committed to achieving the goals that Congress laid out for us
just a few short years ago.
Thank you again for your support, and I look forward to
your questions.
[The prepared statement of Mr. Poth follows:]
Prepared Statement of Michael Poth, Chief Executive Officer,
First Responder Network Authority (FirstNet)
Introduction
Chairman Wicker, Ranking Member Schatz, and all Members of the
Subcommittee, I would like to thank you for the opportunity to appear
here today to provide an update on the progress we are making at
FirstNet toward the deployment of an interoperable nationwide public
safety broadband network (NPSBN). I also want to thank all of the
Members of this Subcommittee who were pivotal in creating FirstNet. We
look forward to your continued support and to working with the
Subcommittee and full Committee as FirstNet moves forward with our
vital mission to improve public safety's access to broadband wireless
communications across the country.
Progress Toward a Network
FirstNet intends to provide cutting-edge, prioritized, and
preemptive wireless broadband communications to millions of first
responders at the local, state, tribal, and Federal levels across all
states, territories and the District of Columbia, consistent with the
vision laid out in the Middle Class Tax Relief and Job Creation Act of
2012 (P.L. 112-96) (Act). By enabling the deployment of the dedicated
NPSBN, FirstNet will provide a ubiquitous solution to decades-long
interoperability and communications challenges and help make our
communities and first responders safer with advanced communications
services, devices, and applications.
FirstNet's goal of enabling the deployment of the network and
thereby meeting the needs of first responders is a matter of critical
importance for public safety. Since our inception, FirstNet has taken
the necessary steps to build an organization, execute a vigorous
consultation and outreach strategy, develop and produce a comprehensive
request for proposals (RFP), and lay the groundwork for a successful
deployment of the NPSBN. Much has been accomplished. However, as it is
with any such undertaking, every step forward presents new challenges,
and requires that innovative solutions be identified. The past three
years have involved thousands of working hours to solve the various
challenges FirstNet has faced. I am proud to say that today we have an
organization of people who are dedicated to public safety and to
fulfilling our mission; a culture of hard work, openness, and
transparency; a procurement strategy that we believe is attractive to
the vendor community and will lead to a successful public-private
agreement; and a robust consultation and outreach program to educate,
inform, and obtain input from our stakeholders. With these
accomplishments, we have sowed the seeds of success as FirstNet strives
to develop the public safety broadband market here in the United States
and to influence public safety around the world.
The Procurement Strategy and Development
FirstNet has engaged in an acquisition process in accordance with
the Federal Acquisition Regulation (FAR). FirstNet began its market
research into the development of the comprehensive RFP in early 2013.
The research included meetings with vendors as well as the issuance of
13 Requests for Information (RFIs), with the last RFI and corresponding
draft Statement of Objectives (SOO) released on September 17, 2014 in
the form of a Special Notice. These RFIs addressed technical questions
regarding the available offerings for equipment and services needed to
implement the NPSBN, as well as questions regarding the acquisition
approach and specific program objectives.
We developed the final RFP using information and data gathered
throughout this process, as well as from our vendor meetings and
``Industry Days,'' stakeholder consultation, and public notice
processes including the release of draft RFP documents in April, 2015.
Our vendor outreach program aimed to obtain a better understanding of
industry's capabilities and analyzed the recommendations and
alternative approaches suggested by the public to determine how to best
leverage existing capabilities and best practices in order to meet
public safety needs.
Following two successful ``Industry Days'' in 2015, FirstNet hosted
a pre-proposal conference on March 10, 2016 with local participation
and a simultaneous webcast. A total of 437 individuals participated
representing 260 organizations, including industry, local government,
media, states and territories, Federal agencies, and trade
associations. The pre-proposal conference also provided key information
pertaining to solicitation highlights and included upcoming key
milestones and the overall phased evaluation approach contained in the
solicitation.
In addition to the ``Industry Days'' and the pre-proposal
conference, FirstNet conducted one-on-one sessions with interested
vendors. These sessions were held to discuss a vendor's capabilities,
current commercial offerings, and major program objectives and to learn
more about industry capabilities to meet those objectives.
Through this acquisition, and the 16 objectives identified in the
SOO as set forth in the solicitation, FirstNet is seeking a
comprehensive network and a service solution that provides as much
coverage and functionality as feasible. FirstNet's goal is to maximize
the network's value to public safety while meeting our financial
sustainability obligations under the Act. The objectives included in
the SOO will ensure that the NPSBN operates as a single network
guaranteeing seamless interoperability between states and territories,
regardless of whether FirstNet or the state/territory deploys the Radio
Access Network (RAN). FirstNet issued the RFP for the deployment of the
NPSBN on January 13, 2016 and subsequently answered 447 industry and
stakeholder questions pertaining to the solicitation and issued 14
amendments to address the questions and feedback received.
The evaluation is being conducted in a multi-phased approach. In
Phase I, interested parties were given the opportunity to provide a
``capability statement'' demonstrating they are capable of performing
the work. The submission of a capability statement afforded FirstNet
the opportunity to review and evaluate the experience and capability of
potential offerors while providing viable potential offerors an
opportunity to receive feedback. Notifications were issued to all
parties who submitted a capability statement on April 8, 2016, and
feedback sessions with those determined to be viable competitors were
held on April 20th and 21st.
Proposals for the comprehensive RFP were submitted by May 31, 2016.
Following receipt of proposals, the Source Selection Team has commenced
with the remaining evaluation phases (Phase II through Phase IV), as
stated in the RFP and described below.
During Phase II, the Source Selection Team will conduct an initial
review of the proposals received to verify conformance and completeness
with the RFP instructions. Those proposals that have been verified as
complete and conform to the RFP instructions will move into Phase III--
Pass/Fail.
As stated in the RFP, under Phase III, an offeror must demonstrate
its ability to sustain the annual payments to FirstNet for the life of
the contract and provide coverage in each of the 56 states and
territories including rural areas. Those offerors whose proposed
solutions have been determined to conform to the RFP in Phase II and
successfully pass Phase III will move into Phase IV. During this final
phase, FirstNet will conduct a detailed evaluation of all information
and documentation received from the offerors based on the evaluation
factors identified within the RFP.
FirstNet currently anticipates making an award of the NPSBN
contract by November 1, 2016, although the ultimate timing is dependent
on the amount of time it takes to comprehensively complete the
evaluation and award process in accordance with the Federal Acquisition
Regulation.
Consultation and Outreach
The consultation and outreach efforts undertaken by FirstNet over
the past few years have been crucial to establishing lasting
partnerships with the states, territories, tribal nations, Federal
agencies, and public safety users. The information FirstNet has
gathered through these efforts has informed our work to develop and
deploy public safety's network and our comprehensive RFP. Consultation
brings together the states and territories as partners in the
development of the NPSBN by having the organization work with the State
Single Point of Contacts (SPOCs) to ensure that FirstNet captures not
only the needs and wishes of the local, state, and tribal public safety
stakeholders, but the data that states and territories have collected
through the funding provided by the National Telecommunication and
Information Administration's (NTIA) State and Local Implementation
Grant Program (SLIGP). Ultimately, we believe that consultation efforts
will lead to the provision of better planned public safety
communications services and products, and increase adoption of the
NPSBN.
Initial Consultation
FirstNet's initial consultation efforts focused on working with
states and territories to facilitate a forum where public safety
officials could discuss real-life examples and use-cases to illustrate
how the FirstNet network could be used once deployed to improve
incident and emergency response. These meetings confirmed to FirstNet
just how diverse and locally focused the network will need to be.
States were especially eager to demonstrate how their day-to-day
challenges were, in the majority of cases, unique to that particular
geographic area or region. For example, the western states have vast
areas of terrain that, at this point, have proven difficult, if not
impossible to cover. So, the issue of rural coverage was a topic that
multiple states and territories raised with FirstNet on numerous
occasions.
A key takeaway from FirstNet's initial consultation efforts in 2015
was that the network is an absolute necessity and that public safety
today uses significant amounts of data to carry out their duties. Time
and time again, states, territories, and public safety personnel
throughout the Nation emphasized the need for the network and urged
that FirstNet work as quickly as possible. By the end of the initial
consultation process, FirstNet had held an in-state meeting with all
states and territories that had requested one.
Phase 2 Consultation
Building on the success of the initial consultation meetings,
FirstNet developed a more focused second phase of consultation with the
states and territories. And while FirstNet consulted with an impressive
number of public safety personnel and groups during the initial
consultation process, it was clear that more work needed to be done
with the states and territories on the planning front. FirstNet decided
to expand outreach efforts to reach a larger audience and to further
educate the public safety community on our goals while concurrently
focusing our consultation on individuals that will likely influence or
contribute to a governor's decision on the RAN deployment to ensure
such decision is informed.
FirstNet has held SPOC follow-up meetings with 54 states and
territories and completed Governance Body Consultation Meetings with 18
states. These meetings are designed to connect with the states and
territories on important network planning and implementation issues,
such as State Plan development and a governor's decision whether to
assume responsibility for RAN deployment and to have a discussion about
the key influencers and key issues that the state/territory and
FirstNet need to consider over the next year.
Data Collection
As part of FirstNet's consultation efforts, states collected data
from local, state, territory, and tribal public safety agencies, which
provided FirstNet with substantial input from public safety
stakeholders across the country. This data, also collected from Federal
agencies, informed our comprehensive RFP in areas such as coverage,
capacity, and public safety incident locations, and this information
was made available to all potential offerors. FirstNet received data
from over 11,600 public safety entities representing 1.6 million public
safety personnel from 54 states and territories and seven Federal
agencies. We are continuing to build on that effort this year, as all
states and territories that choose to do so will be able to update
their information using available SLIGP funds. All data that is
voluntarily collected will continue to inform FirstNet's network
planning and implementation efforts.
Outreach
Throughout the consultation process, FirstNet has simultaneously
engaged in extensive outreach to public safety stakeholders, including
tribal communities, to educate and inform them about FirstNet and the
NPSBN. As part of those efforts, FirstNet has coordinated with state
and territories to support their outreach activities to public safety
practitioners within their borders. FirstNet's tribal outreach team
participated in the primary national and regional tribal organizations'
conferences and meetings and state-hosted tribal engagements in an
effort to educate tribes about FirstNet and encourage tribal
participation in the state and Federal consultation and data collection
process.
Federal Consultation
Although the Act focuses on engagement and planning at the state,
territory, tribal, and local levels, the NPSBN will also serve public
safety personnel at the Federal level. As such, FirstNet has made it a
priority to consult with Federal agencies that provide public safety
services to account for the needs and objectives of those potential
users. FirstNet staff has conducted numerous engagements with a variety
of Federal organizations across the country. FirstNet also worked
closely with Federal agency points of contact to complete an initial
data collection effort that we intentionally aligned with the data
collection effort conducted with the states.
Tribal Outreach
FirstNet is committed to continuing its engagement with sovereign
tribal nations. Tribes have a great need for the NPSBN and FirstNet's
tribal outreach team have been traveling throughout the country to
speak at tribal gatherings, meet with tribal nations regarding
FirstNet, and support SPOC efforts to engage tribal communities
In the past two years, FirstNet's tribal outreach team participated
in the primary national and regional tribal organizations' conferences
and meetings and state-hosted tribal engagements in an effort to
educate tribes about FirstNet and encourage tribal participation in the
state and Federal consultation and data collection process.
In addition, through FirstNet's Public Safety Advisory Committee
(PSAC) Tribal Working Group (TWG), FirstNet has continued to conduct
regular dialogue with delegates and representatives from numerous
tribal organizations.
The TWG, comprised of representatives from a broad cross-section of
multi-tribal associations, was established to provide FirstNet advice
on tribal outreach, education, and inclusive consultation strategies to
ensure participation by tribal jurisdictions in planning for the NPSBN.
State Plans
Following the completion of the RFP process, the Act requires
FirstNet to deliver a plan to each state and territory's governor.
These ``State Plans'' will be used to guide and inform the governors on
FirstNet's intended build-out of the RAN in each state or territory.
The Act clearly requires the governor to decide whether FirstNet will
deploy, maintain, and operate the RAN or whether the state or territory
will assume such responsibility. Indeed, under the Act, until the
governor makes this decision, there can be no early deployment, or any
other action or decision related to the RAN in the state or territory.
Together, FirstNet and our network partner will develop all 56
State Plans. This is an enormous task given a number of factors,
including: the finite resources that are available to FirstNet; the
diverse and varied needs of each individual state and territory; the
wide-ranging goals of the NPSBN; and public safety's expectations that
FirstNet will deploy in a timely manner. To succeed in providing plans
that are representative of not only the discussions that FirstNet has
conducted with the states and territories, but also responsive to
public safety's needs, FirstNet and our partner will need to make this
process a top priority.
Following the development of draft State Plans, FirstNet plans to
provide each state and territory with an opportunity to review and
discuss the draft plans with FirstNet prior to the delivery of the
final plan to the governor. FirstNet will strive to provide State Plans
that are detailed, accurate, and comprehensive, with the information
necessary for each governor to make an informed decision whether to
assume responsibility for the RAN and for the Federal Communications
Commission (FCC) and NTIA to perform their respective statutory
responsibilities of evaluating any state or territory-proposed
alternative RAN plans. States and territories have been advised that
the opportunity to make wholesale changes to these plans will be
minimal and the time to review will be constrained due in part to the
Act's directive to speed deployment of the network.
FirstNet's goal is to deliver final State Plans to the governors in
2017. Understandably, this date must remain flexible given the time
constraints and fluidity of the procurement process as well as the
tight timelines that FirstNet has preliminarily established to develop
all 56 State Plans with our partner post-award.
Innovative and Economic Impact of the Network
Innovation will be a hallmark of FirstNet. Not only will innovation
occur at the outset of this network, it will continue in perpetuity for
the benefit of public safety. If we could see into the future, five,
ten, 20 years from now and beyond, I believe we would be amazed at the
devices and applications that will be running on this network in
support of public safety. In the commercial world we have long heard of
the benefits of the Internet of Things (IOT), but imagine the benefits
to public safety throughout the Nation once an ``Internet of Public
Safety Things'' has been created. I believe that FirstNet can be that
catalyst.
Several other countries are already looking to the United States
and FirstNet as a model for deploying a broadband network for public
safety. Australia, Canada, Mexico, South Korea, and the United Kingdom
are all looking to deploy their own version of FirstNet. Just like
other industries and markets, it is vital that the United States lead
and be at the forefront of public safety broadband. When we lead, we
grow not only our economy, but we continue to have a leading presence
in global markets that will influence future generations of technology
and public safety innovation.
Conclusion
I am grateful to the Subcommittee for the opportunity to update you
on FirstNet's progress. As you can see, FirstNet has established an
innovative business model that strikes the balance between providing
public safety the network that it needs and deserves and incentivizing
industry to participate in the development and deployment. FirstNet is
not simply another government program. We have taken the framework
provided under the Act and developed a unique startup that will
leverage the best of the public safety community with the best of
industry. Indeed, it is this public-private model that has driven much
of our success to date and will lead to the win-win-win solution that
we are striving to achieve; most importantly a win for public safety,
but also a win for the private sector and a win for FirstNet.
Notwithstanding this success and all that we have accomplished in a
relatively short period of time, there remains an enormous amount of
work ahead. FirstNet will continue to meet our statutory obligations,
partner with those who will use and benefit from the network, and work
toward the successful development, deployment, and operation of the
NPSBN.
I ask that this Subcommittee continue to support the organization
as we move through our procurement and the selection of a network
partner. I give you my commitment that FirstNet will continue to
redouble our efforts in order to achieve our objectives, but we can
only do so with the support of Congress, public safety, local
governments, states, territories, tribal jurisdictions, Federal
agencies, and our other stakeholders. Finally, it is important to
remember that this is not FirstNet's network; this is public safety's
network. The public safety community fought for the creation of
FirstNet, and it is up to us to achieve their vision.
Senator Wicker. Thank you very much.
Mr. McLeod.
STATEMENT OF JEFFREY S. McLEOD, DIRECTOR, HOMELAND
SECURITY AND PUBLIC SAFETY DIVISION, NATIONAL
GOVERNORS ASSOCIATION'S CENTER FOR BEST PRACTICES
Mr. McLeod. Chairman Wicker, Ranking Member Schatz,
distinguished members of the Subcommittee, my name is Jeff
McLeod. I'm Director of the Homeland Security and Public Safety
Division at the National Governors Association's Center for
Best Practices.
I appreciate the opportunity to appear before you as a
representative of our Nation's Governors to discuss our shared
commitment to building and sustaining a nationwide broadband
network dedicated to public safety. NGA was a leading advocate
of the public safety spectrum provisions in the legislation
that led to the creation of FirstNet. NGA has represented
Governors before Congress and FirstNet officials on key
implementation issues and challenges facing states.
My testimony today will address factors that Governors must
weigh in reaching a decision whether to join in the deployment
of the public safety broadband network, as referred by
FirstNet, or to opt out and take on the responsibility of
deploying, operating, and maintaining a radio access network in
their state.
Specifically, I'm going to focus on three issues: one,
coverage; two, cost; and three, the consultation process
through which FirstNet is required to engage State leaders. I
would like to summarize my remarks and ask my full written
testimony be submitted to the record.
Our primary consideration for Governors in reaching their
decision is the network's ability to offer reliable coverage
statewide. This is a top concern in states with large rural
areas and in states with challenging geography. FirstNet has
stated that build-out and maintenance of the network in rural
areas will be funded primarily from access fees generated from
the user based in more densely populated areas. Thus, they are
likely to prioritize build-out in metropolitan areas before
rural areas. However, the financial needs of the network must
be balanced with the needs of the public safety community.
State will require that the network be built out in rural
areas, where commercial access is more limited.
In addition to concerns about coverage, questions of cost
top the agenda for many Governors. Governors want to know, one,
whether the network can be built within existing cost models;
two, what the user fee to connect the network will be; and
three, what are the long-term administrative and operation
costs?
The financial models that underpin the network's long-term
sustainability requires a robust and diverse user base. If fees
are too high and public safety users do not utilize the
network, the financial success of the network could be in
jeopardy. States remain concerned that this could lead to user
fees that exceed current outlays on public safety
communications technology. Given the unprecedented nature of
building and maintaining a network of this size and complexity,
states are concerned about the possibility of unforeseen costs
being shifted to them.
Regarding FirstNet's outreach to Governors on the
consultation piece, some have expressed concern about the tone
of the engagement. During the consultation process, FirstNet
has referred to states as constituents. While this may appear
to be mere word choice, it alters the tenor of the engagement
and lessens the focus on partnership. FirstNet must view states
as full partners in this endeavor. States have key information,
processes, and expertise that must be brought to bear on the
full range of FirstNet activities.
In closing, to many states, the opt-out scenario is a false
choice. While there are a number of unknowns associated with
opting in, very few states are in a position to consider taking
on the unknowable and likely significant financial liabilities
associated with building, operating, and maintaining, and
upgrading a full radio access network in their states if they
choose to opt out.
Finally, I would like to note that transition in Governors'
administrations with the coming election cycles presents a
continuing communication and education challenge for FirstNet.
On behalf of NGA and our members, thank you for the
opportunity to testify. I look forward to any questions the
Committee may have.
[The prepared statement of Mr. McLeod follows:]
Prepared Statement of Jeffrey S. McLeod, Director, Homeland Security
and Public Safety Division, National Governors Association's Center for
Best Practices
Overview
Chairman Wicker, Ranking Member Schatz and distinguished members of
the Subcommittee, my name is Jeffrey McLeod, Director of the National
Governors Association's Center for Best Practices' Homeland Security
and Public Safety Division. The National Governors Association (NGA) is
the bipartisan organization of the Nation's governors. Through NGA,
governors share best practices, speak with a collective voice on
national policy, and develop innovative solutions that improve state
government and support the principles of federalism.
I appreciate the opportunity to appear before you today on the
implementation of the First Responder Network Authority (FirstNet). NGA
was a leading advocate of the public safety spectrum provisions in the
legislation that led to the creation of FirstNet, and NGA remains
dedicated to implementing those provisions. Over the last four years,
NGA has continued to represent governors before Congress and FirstNet
officials on key implementation issues and challenges facing states. My
testimony today will focus on the remaining factors governors and
states must consider before reaching their respective decisions on
broadband deployment.
As you may already know, governors are engaged in efforts to
develop and deploy a nationwide public safety broadband network.
Pursuant to FirstNet's authorizing statute, the state planning process
gives governors the decision to either participate in FirstNet's
deployment or follow the necessary steps to provide an alternative plan
for the construction, maintenance, operation and improvements of a
state radio access network.\1\ That decision affects the entire state,
including all individual jurisdictions.
---------------------------------------------------------------------------
\1\ See 47 U.S.C. 1442(e)(2).
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Each state has unique needs for network coverage, which requires
extensive consultation with FirstNet and other stakeholders. Although
states still await FirstNet's plan for deployment, they continue to
engage with FirstNet on the development of network policies and their
respective plans.
Throughout the last several years of planning, states have clearly
identified potential obstacles and challenges surrounding the
implementation of FirstNet, primarily issues of coverage, cost and
consultation. For governors, these factors are critical considerations
in developing a nationwide public safety broadband network that
enhances emergency response and is sustainable over the long term. My
testimony today will focus on these three issues. Before I go any
further, however, I would like to provide some background on the
development of state plans thus far.
State Plans and Governor Decision
As I alluded to earlier, governors are faced with the decision to
opt in or opt out of the FirstNet network. In the lead up to that
decision, FirstNet and states have been engaging in a data collection
and consultation process to prepare individual state plans. After the
request for proposals (RFP) process concludes with the selection of
FirstNet's commercial vendor in late 2016, state plans will be
presented to governors and their state single point of contact (SPOC).
This proposal will detail FirstNet and its commercial vendor's plan
for the buildout of the radio access network (RAN) within a state. Its
intention is to give the governor the information he or she needs to
make the decision to opt in or opt out.
Upon receiving the final plan, governors have 90 days to notify
FirstNet of their decision. If they choose to opt in, there is no
additional action required. FirstNet and its commercial vendor will
build out the network and bear the associated cost of constructing,
operating, and upgrading it. State and local first responders will then
pay a user fee to access the network.\2\
---------------------------------------------------------------------------
\2\ See 47 U.S.C. 1428(a)(1).
---------------------------------------------------------------------------
Alternatively, governors may choose to do nothing upon receiving
the state plan, letting the 90-day deadline for a decision lapse
without action. According to FirstNet, this is considered de facto opt-
in. Even if governors do not affirmatively opt in, they will be
automatically opted into having the RAN built by FirstNet and their
commercial vendor in their state.\3\
---------------------------------------------------------------------------
\3\ Final Interpretations of Parts of the Middle Class Tax Relief
and Job Creation Act of 2012, Federal Register 80, no. 202 (Oct. 20,
2015): 63506.
---------------------------------------------------------------------------
As a third option, governors may also choose to opt out of FirstNet
and its commercial vendor building the RAN. In that case, governors
must notify FirstNet within 90 days of receiving the plan that they
plan to opt-out. Then, within 180 days, they must complete an RFP,
receive any necessary legislative approval, and submit an alternative
plan to the FCC. States must then submit a plan to the National
Telecommunications and Information Administration (NTIA) to lease
spectrum and may apply for RAN construction grant funding. Opt-out
states then have to negotiate a spectrum lease with FirstNet and,
finally, build out their own RAN, all within the timeframes outlined in
the statute. At any point in this process, FirstNet, NTIA, or the
Federal Communications Commission (FCC) can deny the state's plan to
build its own RAN.\4\
---------------------------------------------------------------------------
\4\ Ibid.
---------------------------------------------------------------------------
States that opt out are responsible for all building, maintenance,
operation and upgrade costs associated with the state RAN.
Additionally, state and local users will still have to pay a fee to
connect to the core FirstNet network.\5\
---------------------------------------------------------------------------
\5\ Ibid.
---------------------------------------------------------------------------
For many states, the opt-out scenario is a false choice. Though
there are a number of unknowns associated with opting in, very few
states are in a position to consider taking on the unknowable and
likely significant financial liabilities associated with building,
operating, maintaining, and upgrading a full RAN in their states if
they opt-out.
Coverage
Going back to my three points of focus for today--coverage, cost
and consultation--a primary concern for governors is the network's
ability to offer sufficient and reliable coverage statewide.
Specifically, they are concerned with how extensive coverage will be in
rural areas and how it will differ from commercial options. This is a
particular concern in states with substantial rural areas and in those
with challenging geography and topography. Questions that must be
adequately answered in the state plan for governors to make a fully
informed decision to opt in or opt out include:
What service will be offered in rural areas?
When will it be offered?
What are estimates of the cost of that service?
During the data collection phase of consultation, states provided
FirstNet extensive data and maps detailing their unique coverage needs
and challenges, including areas of critical concern for state and local
first responders. FirstNet has said it has a duty to protect excess
fees generated from densely populated areas to fund the network's
buildout in rural areas. According to FirstNet, this approach ensures
resources are available to build out and maintain the network in rural
areas, where fees generated from the user base would otherwise be
insufficient.\6\ However, the financial needs of the network must be
balanced with the needs of the public safety community in underserved
areas.
---------------------------------------------------------------------------
\6\ Further Proposed Interpretations of the Parts of the Middle
Class Tax Relief and Job Creation Act of 2012, Federal Register 80, no.
49 (Oct. 20, 2015): 13348.
---------------------------------------------------------------------------
Additionally, the FirstNet RFP outlines a number of rural buildout
milestones that any commercial vendor must meet. The final milestone
calls for achieving 100 percent of a vendor's proposed coverage in
rural areas within five years of the contract award.\7\ Including these
milestones in the RFP provides evidence of FirstNet's statutorily
required consideration of rural needs; however, until states have a
clear understanding of what the contractor's proposed coverage looks
like, the milestones are essentially meaningless. Without additional
information, the milestones offer no assurances of widespread and
reliable coverage.
---------------------------------------------------------------------------
\7\ FirstNet Solicitation No. D15PS00295--Section J, Attachment J-
8, IOC/FOC Target Timeline, (Jan. 13, 2016), 5.
---------------------------------------------------------------------------
Many states have existing contracts with commercial communication
providers that offer some coverage in these areas. In the state plans,
FirstNet will need to show governors that their proposed coverage
provides a value-add over existing commercial options, both in terms of
user cost and coverage reliability.
Finally, states are concerned that the costs associated with
building and maintaining a network with sufficient rural coverage will
drive a significant increase in user fees, which will then have an
impact on the rural communities that need this coverage. In building
this network and structuring user fees, states must be assured that
sufficient coverage will not lead to burdensome user fees for resource-
scarce state and local first responders.
Costs
In addition to concerns about coverage, questions of cost top the
agenda of many governors and state policymakers. Governors are
concerned about (1) what the user fees to connect to the network will
be; (2) whether the network can be built within existing cost models;
and (3) what any long-term administrative management and operation
costs may be. States understand that these questions cannot be answered
at this time. However, they expect increased clarity from FirstNet and
its commercial vendor before deciding whether to opt in.
Chief among states' concerns is the user fee structure. It is
expected that FirstNet will reinvest user fees into maintaining and
upgrading the national network. Given the size and scope of this
network, supporting it will require significant financial investment
throughout its lifecycle.
The financial models that underpin the network's long-term
sustainability require a robust and diverse user base. If fees are too
high and public safety users do not utilize the network, the financial
success of the network could be in jeopardy. States remain concerned
that this could lead to user fees in excess of the amount currently
spent on public safety communications technology.
States and municipalities operate within constrained budgets, and
user fees for this network remain largely unknown. Additionally,
municipalities have vastly disparate budget requirements. In other
words, what one city can afford may be far different from what another
can. In particular, this affects rural communities, which frequently
operate in a severely constrained budget environment.
There are also significant questions as to how the FirstNet user
fees will compare with existing commercial user fees. Where commercial
providers can offer a similar service at a lower cost, users will be
less inclined to utilize FirstNet's services. Again, though states
recognize these questions cannot be answered at this time, these
concerns factor significantly into the governor's decision-making
process.
Beyond user fees, governors seek further assurance that states will
not incur unforeseen costs from FirstNet down the road. FirstNet has
asserted that if states make the decision to opt in to the network, the
costs associated with building and maintaining the network will be the
sole responsibility of FirstNet and its commercial vendor. Given the
unprecedented nature of building and maintaining a network of this size
and complexity, states are concerned about the possibility of
unforeseen costs being shifted to them. Though the costs of opting out
of the network are almost certain to be greater than opting in,
governors will have to consider this financial uncertainty as they
weigh their decision to opt in or out.
Finally, states are also grappling with the difficulty of
determining the operational and administrative costs that will be
incurred by state communications agencies when operating on the
FirstNet network. Operating a statewide communications network requires
significant administrative and personnel costs, and this will certainly
be the case when FirstNet is fully deployed. Costs may include
purchasing new equipment or upgrading existing equipment to fully
utilize the services offered on the network. States must consider how
those costs compare with existing commercial solutions and current
state systems.
Consultation and Partnership
That brings me to my last point: consultation. Throughout the
mandated consultation and data collection process, FirstNet has engaged
state leaders on the planned buildout of the nationwide network.
However, states have had some concerns regarding the tone of this
engagement. As NGA has previously emphasized, FirstNet must view states
as partners in this endeavor. The reason for that is not only to meet
the statutory requirements for state consultations, but more important
to ensure that key information, processes and expertise within states
can be appropriately brought to bear on the full range of FirstNet
activities.\8\
---------------------------------------------------------------------------
\8\ Governor Martin O'Malley and Governor Mary Fallin, ``FirstNet
Hearing Letter to Chairman Greg Walden and the Honorable Anna Eshoo,''
(Mar. 13, 2013), available at: http://www
.nga.org/cms/home/federal-relations/nga-letters/homeland-
security_public-safety/col2-content/main-content-list/march-13-2013-
letter_firstnet.html.
---------------------------------------------------------------------------
Since 2013, FirstNet has engaged in extensive consultation with
state, local, county and tribal leaders across the Nation. However,
some states have described this engagement as largely focused on
satisfying the statutory consultation requirement, rather than
developing genuine partnerships with states. Further, some states
remain concerned they are viewed as mere customers of an eventual
national broadband network. During the consultation process, FirstNet
refers to states as ``constituents.'' Althought this may appear to be
mere word choice, it alters the tenor of the engagement and lessens the
focus on partnership. For the network to succeed, states must be viewed
as full-fledged partners.
Additionally, outreach to states must be done in a consistent
fashion and should rely on the existing Single Point of Contact network
that was developed at the outset of this process. Communication with
senior state leaders outside of this framework may result in mixed
messages and duplicative efforts within states. Using this network is
the most effective way for FirstNet to reach governors and their senior
staff. Going through these channels ensures that all the necessary
information is available for governors to make their decision.
Finally, transition in gubernatorial administrations with the
coming election cycles presents a communication and education challenge
for FirstNet. Given the long-term timeline associated with building
this network and delivering services, FirstNet should ensure it is
prepared for eventual turnover in a number of governors' offices,
including key homeland security, public safety, and information
technology staff during the 2016, 2017 and 2018 election cycles.
Conclusion
Governors appreciate the support of this committee in ensuring
progress toward implementation of a nationwide public safety broadband
network. If implemented in a manner that ensures maximum coverage at a
reasonable, certain, and fair cost to states, and with a consultation
process focused on establishing partnerships, FirstNet has the
potential to enhance the ability of first responders to protect states
and localities from harm and provide timely responses to requests for
emergency assistance.
On behalf of the National Governors Association and our members,
thank you for the opportunity to testify. Governors and NGA stand ready
to work with this committee to ensure the successful implementation and
deployment of a national public safety broadband network for first
responders.
Senator Wicker. Well, thank you very much.
General Logan.
STATEMENT OF MAJOR GENERAL ARTHUR J. LOGAN, HAWAII ADJUTANT
GENERAL, STATE OF HAWAII
General Logan. Chairman Wicker, Ranking Member Schatz, all
the Members of the Senate committee, thank you very much for
the opportunity to be here today. I'm Major General Arthur
Logan. I'm the Adjutant General for the State of Hawaii, and
the Governor appointed me as the State's single point of
contact for FirstNet in January 2015. And when he first called
me the ``SPOC,'' I had to think back to Star Trek in 1970s and
I had to touch the top of my ears to make sure they weren't
pointed. But I gather they're rounded, so everything was good.
[Laughter.]
General Logan. But I'm also the Director of Emergency
Management and I'm the Homeland Security Adviser to the
Governor. And if that's not enough, I also oversee the Hawaii
Army and Air National Guard. From those perspectives and my 20
years of law enforcement experience, I want to share with the
Members of this committee the importance of FirstNet.
At the time I was appointed in January 2015, the team had
already been engaged in Hawaii in preparing for the deployment
of FirstNet. Much of the effort focused on education and
outreach to public safety and public policy stakeholders as
well as working toward establishing governance, a Governor's
model, and strengthening Hawaii's current public safety
communications infrastructure.
My first year and a half on the job involved briefings from
key staff in Hawaii, meeting with FirstNet leadership, and
attendance to the biannual FirstNet SPOC meetings and leading
State efforts to develop key public safety communications
plans. So let me just cover a few of the brief activities.
Hawaii sponsored the first FirstNet forum for non-
contiguous states and territories in July 2014. So Hawaii had
the foresight to anticipate the needs and concerns of non-
contiguous states, such as Hawaii, Alaska, Guam, American
Samoa, the Commonwealth of the Northern Mariana Islands, Puerto
Rico, and Virgin Islands. And we know we're different than our
sister states of the Lower 48, who are connected by borders and
could share coverage.
To that end, in 2014, Hawaii sponsored the first ever non-
contiguous states and territories meeting on the island of
Kauai. The attendees included policymakers in government and
public safety and communication subject matter experts from
Hawaii and Alaska and the territories from the Virgin Islands,
Puerto Rico, Guam, and American Samoa.
FirstNet's leadership and the leadership of the Department
of Homeland Security, Office of Emergency Communications,
walked participants through the evolution of technologies used
in public safety communications, from the current standard of
land mobile radios to the future of public safety broadband.
FirstNet heard directly from these jurisdictions and actively
participated in our dialog.
A year later, in July 2015, Governor Ige and I sponsored
executive level FirstNet briefings. We invited the CEO, T.J.
Kennedy, and the Director of Government Affairs, Ed Parkinson,
who flew to Hawaii and engaged in the Governor's Cabinet to
bring the new leaders up to date on the concept of FirstNet and
how it may add value to public safety in Hawaii.
And then in August 2015 was our FirstNet State
consultation. FirstNet brought its technical and state plan
staff to Hawaii for a day and a half meetings with all Hawaii
stakeholders. While FirstNet updated the attendees on the
progress of the project, Hawaii stakeholders of over 90 county,
State, and Federal partners also had the opportunity to inform
FirstNet directly about the challenges in public safety and
communications that arise in Hawaii.
Over the time of the meeting, there was an active
participation by the community, and good questions were
generated. It was said that it's the first meeting I've been to
in Hawaii where people stayed the whole time, they were not out
on the beach enjoying the fine weather.
Later on, the FirstNet environmental team came out to
Hawaii and proposed a problematic environment impact statement,
held public meetings on Oahu, and shared their findings to the
public.
And, last, data submissions. We've worked within our state,
county, public safety, and community throughout Hawaii to
supply FirstNet with a great deal of data regarding specific
communications needs for public safety throughout the State,
and FirstNet will use that data in putting together our state
plan.
So in conclusion, as the State's single point of contact,
I'm grateful to the Committee for the opportunity to share
Hawaii's perspectives and look forward to any questions.
Thank you.
[The prepared statement of General Logan follows:]
Prepared Statement of Major General Arthur J. Logan,
Hawaii Adjutant General, State of Hawaii
Chairman Wicker and Ranking Member Schatz, and all Members of the
Senate Commerce Committee subcommittee on Communications, Technology,
Innovation and the Internet, I would like to thank you for the
opportunity to appear before this subcommittee to provide the
perspective of the State of Hawaii with regard to the progress of
FirstNet.
I am Major General Arthur J. Logan, Adjutant General for the State
of Hawaii. Governor Ige appointed me as the State Point of Contact
(SPOC) for FirstNet, a designation I have held since January 2015. I am
also the Director of Emergency Management, and the Homeland Security
Advisor to the Governor, and if that isn't enough, I also oversee the
Hawaii Army and Air National Guard. From those perspectives, and my
twenty years of Law Enforcement experience, I want share with members
of this committee the importance of a Nationwide Public Safety
Broadband Network (NPSBN), also referred to as FirstNet.
Background: At the time I was appointed Adjutant General in January
2015, Hawaii's team was already engaged in preparing for the potential
deployment of FirstNet in Hawaii. Much of that effort was focused on
education and outreach to public safety and public policy stakeholders,
as well as working toward establishing a governance model to strengthen
Hawaii's current public safety communications infrastructure. My first
year and one-half on the job involved briefings from key staff in
Hawaii, meetings with FirstNet leadership, attendance at the bi-annual
FirstNet SPOC meetings and leading state efforts to develop key public
safety communications plans.
Provided below is a brief summary of activities in Hawaii to engage
stakeholders:
1. Hawaii Sponsored FirstNet Forum for Non-Contiguous States and
Territories in July 2014. Hawaii had the foresight to
anticipate that the needs and concerns of the non-contiguous
states (HI and AK) and territories (GU, AS, CNMI, PR, and VI)
were different than those of sister states on the mainland. To
that end, in 2014, Hawaii sponsored the first ever meeting of
the non-contiguous states and territories in the county of
Kaua`i: ``Bodies of Water/Bodies of Land: The NPSBN
Challenge''. Attendees included policy makers in government and
public safety and communications subject matter experts from
Hawaii and Alaska and from the territories of the U.S. Virgin
Islands, Puerto Rico, Guam, American Samoa, and the
Commonwealth of the Northern Marianna Islands. FirstNet
leadership and leadership of the Department of Homeland
Security Office of Emergency Communications (DHS/OEC) walked
participants through the evolution of technologies used in
public safety communications, from the current standard of land
mobile radios to the future of public safety broadband.
FirstNet heard directly from these jurisdictions and actively
participated in dialogue with leadership as to the challenges.
2. Governor Ige Sponsored an Executive level FirstNet briefing to
his new cabinet appointees in July 2015. As the newly elected
Governor, Governor Ige felt it important to have key cabinet
directors understand FirstNet and its importance to public
safety. FirstNet CEO TJ Kennedy and the Director of Government
Affairs, Ed Parkinson, flew to Hawaii and made a presentation
to the Cabinet to help bring these new leaders up to date on
the concept of FirstNet, and how it may add value to public
safety in Hawaii.
3. FirstNet State Consultation Meeting, August 2015. FirstNet
brought its technical and state plan staff to Hawaii for the
day and one-half meeting with Hawaii stakeholders. While
FirstNet updated the attendees as to the progress of the
project, Hawaii stakeholders (over 90 from the counties, state
agencies, Federal partners), also had the opportunity to inform
FirstNet directly about the challenges in public safety
communications that arise in Hawaii. Over the time of the
meeting, there was active participation by the community and
good questions were generated. It was said that ``it's the
first meeting I've been to in Hawaii where people stayed for
the whole time!''
4. Programmatic Environmental Impact Statement (PEIS). The FirstNet
Environmental team prepared a PEIS report and held a public
meeting in O`ahu to share findings with the public. The Report
was sent for public comment as well.
5. Data submissions. We have worked with our state and county public
safety community throughout Hawaii to supply FirstNet with a
great deal of data regarding the specific communications needs
of public safety throughout the State. FirstNet will use this
data in putting together the State Plan for Hawaii.
Opportunities Created
Governance: Good governance means support of innovation. As we
stand up strong governance for our current environment, the foundation
is laid for governance of FirstNet in Hawaii. Hawaii formed the
Statewide Interoperable Communications Executive Board (SIEB); the
focus of which is specifically public safety interoperable
communications. We look to build upon its charter to include planning
for FirstNet and considering Cyber challenges.
Focus on Public Safety Communications: Hawaii is focusing now, more
than ever, on public safety communications. FirstNet precipitated that
discussion.
National Governors Association (NGA) Policy Academy on Public
Safety Interoperable Communications: As one of five states selected to
participate in the NGA Policy Academy, sponsored in collaboration with
DHS/OEC, the Governor tasked me to further develop a Governance entity
that will drive the success of our public safety communications
operations, both in our current environment of land mobile radios and
into the future with FirstNet/public safety broadband.
Federal Communications Commission (FCC): Working on FirstNet has
opened the door to opportunities to better understand the role of this
regulatory body in all aspects of our communications environment.
State E911 Board: My office is forging a collaborative relationship
with the State E911 Board to look at synergies among stakeholders.
Statewide Communications Interoperability Plan (SCIP) and SCIP
meetings: Stakeholder driven meetings to discuss, in the context of the
big picture of homeland security, how our communications system(s) are
working, where are the gaps, what are the strengths--all of these are
elements of planning for FirstNet.
The Governor and State role in FirstNet
These and similar efforts around the country assist FirstNet in the
development of State Plans. Once an individual state plan is developed
by FirstNet and presented to a state, the governor has the critical
role of accepting the FirstNet plan for network coverage within the
state--known as ``opt-in''--or deciding to seek approval and funding
for construction of an alternative radio access network (RAN)--known as
``opt-out.''
Opt-in/opt-out: There is no decision nor a basis for the decision
at this time. Hawaii will work with FirstNet in the development of the
State plan as long as the dollars are available to support staff. The
State intends to continue collaborating with other states now issuing
requests for information; we believe such information will help Hawaii
develop its own business plan and more fully inform our review of a
proposed state plan.
Funding: There is not enough money available to perform due
diligence on the Hawaii State Plan that will be provided by FirstNet.
Hawaii's Federal grant dollars for FirstNet will likely be exhausted
before receipt of the draft state plan expected in the first or second
quarter of 2017. The Federal formula for allocating money to the states
consistently understates the cost of travel for stakeholders in Hawaii
where counties are separated by water, the cost to attend meetings on
the mainland is exorbitant, and there is a lack of full time resources
to perform the type of work needed to prepare an informed
recommendation to the Governor with regard to a decision to ``opt-in''
or ``opt-out.'' We want to ensure that the Plan provides the necessary
coverage in all areas of the state, including rural and high risk
areas, such as tourist locations and port facilities. Thus, Hawaii
believes FirstNet should make available additional funding for the
state so we can properly evaluate our state plan before its
presentation to the governor for a decision. Such funding will allow
for a truly collaborative effort in the design of the state plan to
best serve our public safety stakeholders.
Issues Specific to Hawaii
Relevant Information Meetings are not held in Hawaii: Hawaii is a
remote and beautiful archipelago in the middle of the Pacific Ocean
with its some 1.2 million inhabitants. Holding relevant national
meetings in the state, which would help educate our constituents, is
frowned upon. It is often said: ``we can't meet there; it's the
optics.'' On the other side, there is inadequate funding to send our
stakeholders to the types of meetings that will help increase their
skills and knowledge. This may present a challenge to deployment of
FirstNet.
Geographical Diversity. Hawaii has urged FirstNet to consider the
isolated nature, diverse geography and unique characteristics of the
State in designing a solution to meet the public safety broadband
requirements. Hawaii is the most isolated population center on the face
of the earth with almost 2,400 hundred miles of ocean separating Hawaii
from the west coast of the continental United States.
The Hawaiian Archipelago consists of scattered points of land
stretching over 1,600 miles, making communications extremely important
and difficult. As a chain of islands, Hawaii does not have an adjoining
state to share support and coverage.
Hawaii has four counties that encompass the eight named islands.
The State Capital and largest city is Honolulu, located on the island
of Oahu. The consolidated City and County of Honolulu includes an urban
area on Oahu with a population of approximately one million. Although
Honolulu is a densely populated urban center, there are many rural
areas of low population throughout the State. Such areas have critical
public safety needs that require the same access to FirstNet.
Tourism: Tourist population impacts state services. Each day, on
average, the State entertains some 300,000 tourists from all over the
world. Many enjoy the natural beauty of Hawaii by visiting beaches,
mountains, hiking trails and remote areas throughout the state.
Accidents, medical incidents, and other public safety emergencies
involving tourists are inevitable and must be dealt with effectively by
public safety responders.
Military: Hawaii also houses approximately 70,000 military
personnel from all branches of the Armed Forces stationed at bases
throughout the State. Protection of Hawaii's Critical Infrastructure
Sectors, including the Hawaii's port facilities is essential as some 80
percent of all Hawaii's goods and commodities flow through our harbors.
Weather: According to the National Oceanic and Atmospheric
Administration (``NOAA''), Hawaii is the state at greatest risk from
hurricane, tsunami, severe flooding, high surf, and volcanic activity.
Many of our inhabitants live in remote areas where communications and
response will be extremely difficult.
Hawaii public safety responders include the whole community. In an
emergency, first and secondary responders, such as utilities and non-
governmental organizations, are a crucial part of the communications
community. This is a consideration we will look for in the FirstNet
State Plan.
Conclusion
As the State Point of Contact for Hawaii, I am grateful to the
Committee for the opportunity to share the Hawaii perspective with
regard to FirstNet. We will continue to work toward educating our
stakeholders and reinforcing our current public safety communications
infrastructure to prepare to be a part of the first Nationwide Public
Safety Broadband Network, also known as FirstNet. We are pleased to
have a good team in Hawaii dedicated to the best interests of our
community.
Senator Wicker. And thank you very much.
And, Mr. Katsaros.
STATEMENT OF ANDREW KATSAROS, PRINCIPAL ASSISTANT
INSPECTOR GENERAL FOR AUDIT AND EVALUATION,
U.S. DEPARTMENT OF COMMERCE OFFICE OF
INSPECTOR GENERAL
Mr. Katsaros. Good morning, Chairman Wicker, Ranking Member
Schatz, and distinguished members of the Subcommittee. Thank
you for providing me the opportunity to talk to you today about
FirstNet more than 4 years since the passage of the Act that
established the authority. I appreciate the invitation to be
here to discuss this important topic.
I am the Principal Assistant Inspector General for Audit
and Evaluation at the Department of Commerce Office of
Inspector General. Our testimony today will focus on three
areas that we have identified as ongoing risks that FirstNet
will face. We believe that these challenges will become
apparent during their efforts to ensure implementation of a
nationwide interoperable wireless broadband network for the
public safety community. Specifically, these three areas of
risk include: one, acquisition management; two, consultations
with states and other localities; and three, internal control.
Our office believes that if these three areas of short- and
long-term risk are not addressed between now and the launch in
approximately midyear 2018, the implementation may not succeed.
The first of the three topics I would like to discuss is
that FirstNet must effectively manage its acquisitions. The
deadline for bidders responding to FirstNet's request for
proposal has passed, and they plan to issue a final award as
soon as November of this year. The approach to final issuance
of this award may prove difficult with everything left to
accomplish, and we believe that this schedule is aggressive. We
also believe that successfully managing the request for
proposal, including evaluating vendor proposals and avoiding
conflicts of interest, is critical to the development and
implementation of the network, and in executing that
implementation, we believe that FirstNet will face geographical
challenges in providing service to all 56 states and
territories at a competitive cost. Finally, for FirstNet to
succeed, multiple Federal agencies will have to collaborate
efficiently over the 25-year term of the complex contract.
The second topic I would like to discuss is that effective
consultation with states and other localities is critical to
FirstNet's success. The Act requires FirstNet to consult with a
variety of stakeholders as it builds a network, including, but
not limited to, Federal, State, tribal, and local public safety
entities. FirstNet has made progress in its discussion and
outreach efforts in a variety of ways, to include conducting
visits with 55 states and territories, attending conferences,
speaking at tribal gatherings, attending national public safety
association events and State-hosted outreach meetings, working
with law enforcement leaders, and engaging in social media. For
the network to succeed, we believe that FirstNet must continue
its consultation and outreach efforts to identify public safety
needs. While doing this, FirstNet must use input from its
consultations to develop individual plans for each State and
territory which uniquely satisfy their needs.
And, finally, the third potential risk I would like to
discuss is that FirstNet must continue to strength its internal
control. In each of our audit reports, we have identified
control weaknesses. Similarly, as part of FirstNet's annual
financial statement audit, independent auditing firms also
identified areas where controls need strengthening. When made
aware of these issues, FirstNet management responded
appropriately stating their plans to address the areas of
concerns and has, in many instances, begun to implement change.
In conclusion, our office feels that these three areas are
short- and long-term risks to FirstNet and that the group's
efforts to minimize the potential impacts must be both ongoing
and attentive.
Chairman Wicker, Ranking Member Schatz, and Members of the
Subcommittee, thank you again for this opportunity to appear
before you today. I ask that my testimony be entered into the
record. And I will be happy to answer your questions.
[The prepared statement of Mr. Katsaros follows:]
Prepared Statement of Andrew Katsaros, Principal Assistant Inspector
General for Audit and Evaluation, U.S. Department of Commerce Office of
Inspector General
Chairman Wicker, Ranking Member Schatz, and Members of the
Subcommittee:
We appreciate the opportunity to testify about the current status
of, and challenges encountered by, the First Responder Network
Authority (FirstNet). Our testimony today--more than 4 years after the
passage of the Middle Class Tax Relief and Job Creation Act of 2012 \1\
(the Act) that established FirstNet--will focus on (1) the history of
the organization and its work to date; (2) the Office of Inspector
General's (OIG's) oversight efforts; and (3) ongoing risks FirstNet
faces in their efforts to ensure implementation of a nationwide,
interoperable, wireless broadband network for the public safety
community.
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\1\ Middle Class Tax Relief and Job Creation Act of 2012, Pub. L.
No. 112-96.
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1. Introduction to FirstNet
Establishment and purpose
Signed into law on February 22, 2012, the Act established FirstNet
as an independent authority within the Department of Commerce's
National Telecommunications and Information Administration (NTIA). The
Act authorized up to $7 billion in funding for the establishment of an
interoperable Nationwide Public Safety Broadband Network (NPSBN). The
Act also provided $135 million under the State and Local Implementation
Grant Program (SLIGP) to promote state outreach, data collection
efforts, and planning for the NPSBN.
The Federal Communications Commission (FCC) spectrum auction,
completed in January 2015, raised about $45 billion--enough to cover
the $7 billion targeted for FirstNet under the Act. FirstNet holds the
single Public Safety Wireless Network License for use of the 700 MHz D
block spectrum and a pre-existing block of public safety broadband
spectrum.
Organization and implementation
FirstNet is governed by a 15-member Board consisting of the
Attorney General of the United States, the Secretary of Homeland
Security, the Director of the Office of Management and Budget, and 12
nonpermanent members, including representatives from state and local
governments, the public safety community, and technical fields. For
roughly the first year and a half of its existence, certain FirstNet
Board members functioned in management roles. The Board eventually
assembled a management team, which assumed all operational
responsibilities. As of June 2016, a management team has been assembled
to complete FirstNet's mission, including a Chief Executive Officer,
President, Chief Counsel, Chief Technology Officer, Chief Information
Officer, Chief Administrative Officer, Chief Financial Officer, and
Chief Procurement Officer, supported by a cadre of professionals.
So far, implementation of the NPSBN has occurred in the following
areas:
Establishing an organizational structure. FirstNet hired key
leadership and support staff for its day-to-day operations;
developed controls; established its headquarters in Reston,
Virginia, and its technical headquarters in Boulder, Colorado;
awarded contracts to obtain project management and planning
support, professional and subject matter support, and network
and business plan development; and signed interagency
agreements with other Federal entities to provide key services.
Conducting initial consultation and outreach. FirstNet
launched a website, conducted conference calls and webinars
with state single points of contact (SPOCs), coordinated with
NTIA's SLIGP team, and established its Public Safety Advisory
Committee (PSAC).\2\ In July 2014, FirstNet began to hold a
series of state and U.S. territory consultation meetings. As of
May 31, 2016, initial state consultations and data had been
received from nearly all the states and U.S. territories. Also,
FirstNet has held consultations with tribal nations and Federal
users as well as held other discretionary outreach events
(speaking engagements at conferences, expositions, town hall
meetings and summits) in order to educate and engage
stakeholders from the public safety community.
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\2\ The Middle Class Tax Relief and Job Creation Act of 2012
required FirstNet to establish the PSAC. It was created in February
2013 and consists of 40 members representing all disciplines of public
safety as well as state, territorial, tribal, and local governments.
See ``Public Safety Advisory Committee'' at www.firstnet.gov/about/
publicsafety-advisory-committee.
Implementing a network solution. In January 2016, FirstNet
issued a request for proposals (RFP) for the purpose of seeking
a vendor to build and operate the NPSBN. Proposals were due by
the end of May 2016. Prior to issuing the RFP, FirstNet sought
input from vendors and other stakeholders, issuing multiple
requests for information (RFIs), public notices and requests
for comment seeking input regarding interpretations of
FirstNet's enabling legislation, and a draft RFP. It also has
spectrum lease agreements with four public-safety projects
funded by grants awarded via NTIA's Broadband Technology
Opportunities Program (BTOP) and with the State of Texas/Harris
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County to provide FirstNet with lessons learned.
FirstNet's expenditures have increased as it has moved toward
building the NPSBN. FirstNet reported that it spent less than $250,000
in Fiscal Year (FY) 2012. In FY 2013, it spent about $17 million. In FY
2014, FirstNet incurred operating expenses of $24 million, and $49
million in FY 2015. FirstNet's current focus is on consultation and the
acquisition/RFP processes.
2. OIG's FirstNet Oversight
FirstNet's authorizing legislation and subsequent enacted
appropriations did not contain an explicit provision for funding
permanent, ongoing oversight to prevent and detect waste, fraud, and
abuse for FirstNet. In May 2014, OIG entered into a memorandum of
understanding (MOU) under the Economy Act with FirstNet to provide
specific oversight services that FirstNet sought, such as conducting
oversight of FirstNet acquisition processes. Specifically, the FirstNet
Chairman of the Board had requested that OIG review ethics and
procurement concerns raised by a FirstNet Board member. The agreement
was amended in November 2014, providing additional funds and extending
the MOU through September 30, 2016. On May 27, 2016, FirstNet moved to
terminate the MOU, which we are now closing out over a subsequent 90-
day period. This will end all FirstNet requests for OIG services. As a
result of the cancelling of the MOU, future OIG audits of FirstNet
programs and operations will be conducted using OIG's direct
appropriation for general oversight--and prioritized along with the
Department of Commerce's other 11 bureaus and agencies.\3\
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\3\ Commerce agencies and bureaus are made up of the Bureau of
Industry and Security, Economic and Statistics Administration (includes
the Bureau of Economic Analysis and U.S. Census Bureau), Economic
Development Administration, International Trade Administration,
Minority Business Development Agency, National Institute of Standards
and Technology, National Technical Information Service, National
Oceanic and Atmospheric Administration, U.S. Patent and Trademark
Office, and NTIA.
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Building on OIG's experience with broadband and public safety
programs (for example, the Public Safety Interoperable Communications
(PSIC) grant program and BTOP), the team's initial audit and evaluation
activities have included:
tracking the progress of FirstNet by regularly interacting
with staff members and covering agency proceedings, as well as
monitoring FirstNet and NTIA for key actions taken to implement
the network;
developing an initial risk assessment in FY 2013 and
routinely reassessing risk as part of annual Department-wide
assessments;
identifying FirstNet as a management challenge in our FYs
2013-2016 Top Management Challenges reports, noting challenges
related to procurement, internal control, staffing, and
stakeholder consultation; and
providing an information memorandum for FirstNet in February
2014 to identify FirstNet's initial management challenges,
including establishing an effective organization, fostering
cooperation among various state and local public safety
agencies, integrating existing grants to enhance public
communications capabilities into FirstNet, and creating a
nationwide long-term evolution network.
In December, 2014, we issued our first audit of FirstNet.\4\ Our
findings addressed financial disclosure, the monitoring of potential
conflicts of interest, contracting practices, and oversight of hiring.
We made nine recommendations. In our opinion, FirstNet took the
findings seriously and has made progress towards implementing our
recommendations. Subsequent audits covered FirstNet's hiring
challenges, need for comprehensive planning and monitoring, and
inconsistent implementation of controls,\5\ and identified
opportunities to improve the effectiveness of the Federal consultation
program, including strengthening accountability, and increasing Federal
input.\6\
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\4\ FirstNet Must Strengthen Management of Financial Disclosures
and Monitoring of Contracts (OIG-15-013-A), December 5, 2014.
\5\ Audit of FirstNet's Workforce and Recruiting Challenges,
Participation at Discretionary Outreach Events, and Internal Control
(OIG-15-036-A), August 14, 2015.
\6\ Audit of FirstNet's Efforts to Include Federal Agencies in its
NPSBN (OIG-16-017-A), February 8, 2016.
In March 2015, we submitted written testimony to the United States
Senate Committee on Commerce, Science, and Transportation, which
contained information regarding FirstNet's implementation of the NPSBN,
the establishment of an OIG audit team dedicated to FirstNet oversight,
and continuing challenges facing the program.\7\
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\7\ First Responder Network Authority's Progress and Challenges in
Establishing a Public Safety Broadband Network (OIG-15-019-T), March
11, 2015.
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In January 2016, we initiated an audit of FirstNet's management of
interagency agreements, which provide important services such as human
resources, financial management, and procurement and accounted for
approximately 30 percent of incurred FY 2015 expenses. Finally, we have
also prepared a risk-based analysis of potential future audit areas.
3. Ongoing Risks Facing FirstNet
More than 4 years since the passage of the Act, FirstNet faces a
wide range of short and long-term risks.
A. FirstNet Must Effectively Manage its Acquisitions
FirstNet's award schedule is aggressive. The May 31, 2016, deadline
for bidders responding to FirstNet's RFP has passed. FirstNet intends
to make a final award as soon as November 2016. To meet a November
goal, FirstNet must now have an approach to evaluate proposals
received, including identifying qualified personnel to evaluate the
proposals and ensuring that these personnel do not have conflicts of
interest.
The successful bid must meet the goals established by the RFP.
FirstNet adopted an objectives-based approach in its RFP--rather than a
traditional requirements-driven model--to provide industry the maximum
opportunity and flexibility in the development of innovative solutions
for the NPSBN. According to FirstNet, providing this flexibility
enables offerors to illustrate their intent in their proposals to meet
or exceed the high-level objectives illustrated within the RFP.
As the RFP points out, FirstNet must provide services at
competitive prices given constrained local, state, and Federal budgets.
It must also be self-sustaining. FirstNet must leverage existing
infrastructure, obtain optimal value for excess network capacity, and
optimize its pricing structure in order to deliver a high-quality,
affordable broadband network and services to the Nation's first
responders. In addition, local emergency communications needs are
typically met by separate networks using different technologies, and
each jurisdiction has its own laws and procedures for building,
managing, and funding communications infrastructure. Among the
challenges facing FirstNet is accommodating current emergency response
systems of localities and their future needs without compromising the
benefits of a national network. FirstNet officials have stated that the
evaluation process will also include negotiations with potential
contractors. Successfully managing the RFP--evaluating vendor proposals
and avoiding conflicts of interest--is critical to the development and
implementation of the NPSBN.
FirstNet is a nationwide network with geographical challenges.
FirstNet has identified what it refers to as ``the coverage
challenge.'' That is, the geography of the 56 jurisdictions is varied,
with the bulk of the population residing in about 5 percent of the U.S.
land mass. The rest of the population resides in rural and wilderness
settings. The 3.8 million square miles to be covered by the network
will include urban, suburban, rural, and wilderness areas, as well as
islands. FirstNet must offer public safety grade services at a cost
that is competitive to all users and pay particular attention to
coverage of rural areas, a subject specifically prioritized by the Act.
Multiple Federal Government stakeholders must effectively
coordinate. The contract is complex and has a 25 year term. The RFP was
issued by the Department of the Interior on behalf of FirstNet. For
FirstNet to succeed, all parties at Commerce and Interior must
collaborate harmoniously and efficiently over the course of a lengthy
contract term.
B. Effective Consultation with States and Localities is Critical to
FirstNet's Success
FirstNet must continue its consultation efforts to identify public
safety needs for the NPSBN. The Act requires FirstNet to consult with a
variety of stakeholders as it builds the network, including, but not
limited to, federal, state, tribal, and local public safety entities.
The Act also requires FirstNet to consult with SPOCs from each state
and territory, and the Act authorizes the SLIGP, which provides
resources to those states and territories to consult with FirstNet and
plan for the NPSBN. NTIA administers SLIGP and awarded grants totaling
$116.56 million.\8\ FirstNet must incorporate consultation input into
an effective network design that meets public safety needs.
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\8\ The State of Mississippi did not receive SLIGP funds.
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FirstNet must use input from consultation in order to develop
individual State Plans for each state and territory. After the
completion of the RFP award process, a key next step is for FirstNet to
deliver these State Plans to each governor regarding FirstNet's plan to
deploy the Radio Access Network (RAN) within the state or territory.\9\
Each governor will decide whether it will opt-in to the delivered plan
(that is, FirstNet takes on the responsibility of building the RAN) or
opt-out (the state or territory takes on the responsibility to deploy,
operate, and maintain the RAN within its jurisdiction.) Effective
consultation and outreach will increase the likelihood that FirstNet
(1) develops State Plans that meet the unique needs of the state or
territory; (2) designs a nationwide network that receives adoption and
support from the public safety community nationwide; and (3) provides
effective guidance to opt-out states regarding RAN design and NPSBN
requirements.
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\9\ FirstNet has estimated it will complete draft state plans
around May 2017 and will finalize and deliver state plans by the end of
2017.
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FirstNet has made progress in its consultation efforts. FirstNet
established a state consultation process, completed initial
consultation visits with 55 states and territories, and has begun to
hold follow-up meetings. FirstNet received data from 54 states and
territories to better understand their network public safety needs,
including data on (1) network coverage, (2) users and operational
areas, (3) network capacity, and (4) current services and procurement.
FirstNet conducted outreach to the public safety community by, for
example, attending conferences, speaking at tribal gatherings,
attending national public safety association events and state-hosted
outreach meetings, working with law enforcement leaders, and engaging
social media. FirstNet also established a Federal consultation process
to seek input from Federal agencies and departments across the country.
C. FirstNet Must Continue to Strengthen Its Internal Control
As FirstNet's administrative processes have evolved to meet
continuing challenges, it has needed to balance expediency and
accountability. In order to meet its goals, FirstNet has grown
rapidly--Federal employees and contractors increased from 123 to 198 in
FY 2015.\10\ And adding to its many challenges, FirstNet is limited by
the Act to a maximum of $100 million for administrative costs over a 10
year period.
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\10\ FirstNet, February 2016. FY 2015: Annual Report to Congress,
p. 7.
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The Government Accountability Office (GAO) has defined internal
control as ``. . .a process effected by the entity's oversight body,
management, and other personnel that provides reasonable assurance that
the objectives of the entity will be achieved. . ..'' \11\ GAO
recognizes that internal control procedures can be operational-,
reporting-, or compliance-based.
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\11\ GAO, September 2014. Standards for Internal Control in the
Federal Government, GAO-14-704G, OV1.01, p. 5.
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OIG and independent audit firms have identified areas for
improvement. FirstNet continues to implement and strengthen internal
control throughout the organization; however, opportunities for
improvement remain. In each of our FirstNet audit reports, OIG has
identified areas needing improvement, specifically in regards to
processes and controls. These reports have resulted in numerous
recommendations for improvement across FirstNet and the Department of
Commerce. Similarly, independent auditing firms, as part of FirstNet's
required yearly audit,\12\ have identified areas where FirstNet
controls needed strengthening. The Independent Auditor's report for FY
2014 and 2015 noted that Commerce's annual financial statement audit
included findings regarding information system access and configuration
management, which the auditor noted as a FirstNet significant
deficiency due to its reliance on Commerce information systems. It
recommended that FirstNet develop a general ledger transaction review
processes to compensate for the deficiency. In all instances, FirstNet
management responded appropriately, stating their plans to address the
issues.
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\12\ See 47 U.S.C. Sec. 1429.
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FirstNet has, in many instances, begun to implement changes to its
process prior to issuance of the reports, and OIG has reviewed and
accepted FirstNet's action plans addressing all report findings.
FirstNet has taken steps to improve internal control. At the March
16, 2016, meeting of the Board, FirstNet's Chief Financial Officer
reported the actions FirstNet has taken to improve its internal control
process included:
Adoption of an Internal Control Implementation Plan
Completion of its first risk assessment
Enhancement of FirstNet's financial management procedures
Development of a Core Assessment Team to evaluate internal
controls
FirstNet faces additional award challenges. For example, FirstNet
must prudently manage the Band 14 Incumbent Spectrum Relocation Grant
Program, established to clear spectrum for the NPSBN. FirstNet has
begun the process for awarding grant funds to public safety entities.
In addition, as a fairly new organization requiring extensive travel
and small purchases, travel and procurement card expenditures pose a
risk.
FirstNet has noted several upcoming milestones for the deployment
of the NPSBN. See figure 1. As FirstNet moves towards these next phases
of implementing the NPSBN, continued improvement and oversight of
FirstNet's processes will be critical.
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Source: FirstNet, March 2016 Board Meeting
We will continue to keep the Committee informed of FirstNet's
progress with respect to the challenges discussed here--and any others
we identify through our audits and investigations.
I will be pleased to take your questions.
Senator Wicker. Well, thank you very, very much. And let's
do 5-minute rounds of questioning.
Mr. Poth, let's talk about the fact that $7 billion doesn't
go as far as it used to go. The $7 billion really was startup
fundings not intended to sustain the network for very long.
With vastly rural populations having differing emergency needs,
what challenges do you have there, and what are your thoughts
about covering the rural areas of this Nation? And also with
regard to that, once FirstNet is deployed, it's going to charge
user fees. Do you think the user fees will generate enough
revenue to sustain FirstNet? And is this going to be a problem
for rural areas in terms of a cost burden?
Mr. Poth. Thank you very much for the question. And you're
exactly right, Senator Wicker, $7 billion doesn't go as far as
it used to.
So what we have done with the $7 billion, but more
importantly, the 20 megahertz of spectrum that Congress gave
FirstNet, that becomes the true value prop to then sit at the
table with a partner to come together with their assets and our
assets, and we believe the 20 megahertz of spectrum is
beachfront property, and we should and will maximize the value
of that for public safety. We expect that the commercial
partners will come with X amount of capital on their side to
start the nationwide buildout of the broadband network.
Part of the components that we've built into the RFP also
we are not satisfied just to attack the densely populated
areas, we are also very focused on the rural coverage. And even
though it's a statutory requirement, we've built into the RFP
that every phase of the buildout, at least a rural coverage
component, will be contained in there.
We expect our commercial partners, who are typically
incentivized, by only going out as far as economically
feasible, we'll have to look at that mandate, and we're
expecting, through the responses, exactly what the coverage
components can be.
We've also required in the RFP with each phase of the
build-out rural coverage components with by the fifth year of
the build-out, 100 percent of what they have proposed in rural
coverage will be accomplished.
We've also, to address concerns about cost out in the rural
areas, we are driving in through the RFP, and with our partner
for public safety, preferred pricing, and we expect the
commercial partner to be very successful, and we hope that they
are, in commoditizing the excess spectrum on the commercial
side that will keep the fees and the revenues coming into
FirstNet for not only the sustainability but also keep the
costs down for public safety users, whether they're in rural,
urban, or suburban areas.
So we think with all those various factors together, we
have provided a platform for success for both the public safety
and the partner to be successful on this contract.
Senator Wicker. OK. Well, continue to keep us posted on
that.
You know, in the 1 minute 42 seconds remaining, I don't
know if I can ask you to respond to Mr. Katsoros's testimony,
but he did mention some concerns, no doubt about it,
particularly about FirstNet continuing to strengthen its
internal control, and I think the clear message is that it's
not where it needs to be. That's the way I took the testimony.
So let me ask you, what--your team has participated in
outreach efforts throughout the country to assess the needs of
each State. What do you--do you believe the decisionmaking
process, as it stands today, is as good as it should be?
Mr. Poth. There is obviously room for improvement in
anything that you do, but I'll make a run at trying to answer
some of the concerns. So on the acquisition management, we have
a very rigorous process in place to ensure that the ultimate
evaluation----
Senator Wicker. Well, let me just--let's go then to the one
that I specifically mentioned----
Mr. Poth. OK.
Senator Wicker.--which FirstNet must continue to strengthen
its internal control. And I do believe I've characterized the
testimony as that it's not where it should be.
Mr. Poth. Right. I think we believe that the internal
controls that have been in place, and thanks to the work of
working collaboratively with the Inspector General, we've
instituted even more rigor in the internal controls and audits,
both within FirstNet with compliance committee reviews, people,
and processes, we've strengthened those, and with the Inspector
General's audits, I think we believe now that the controls that
are in place are allowing us to be successful for the future,
for the partnership going forward.
Senator Wicker. And do you think the decisionmaking
process, as it stands today, is as good as it should be?
Mr. Poth. I believe so. I have a very strong team that I'm
extremely proud of, and I'm buffered by a Board of Directors
that the statute is enabled that takes expertise from both the
Federal Government, from the wireless community, and financial
communities, and when you bring those two together, I think the
decisionmaking process is solid. Obviously, as we are forging
new territory, there may be twists and turns, but I am fully
confident with the team that is in place, we'll be able to
navigate those turns.
Senator Wicker. Thank you very much.
Senator Schatz.
Senator Schatz. Thank you, Mr. Chairman.
My first question is for Mr. Poth. Mr. McLeod, from NGA,
talked about sort of a ``choice of words'' question with
respect to whether or not states and Governors and single
points of contacts are constituents or partners. And as a
former Lieutenant Governor and a former member of the State
administration, I'm kind of sensitive to that on behalf of
State governments. And I would just like your assurance that
you're listening to Mr. McLeod, and by virtue of listening to
Mr. McLeod, hearing that concern, and that we have your
commitment working on a going-forward basis with the State
administrations and TAGs and others that we really are going to
be in a partnership situation rather than sort of a grantee/
grantor relationship.
Mr. Poth. No, absolutely. The states and the people that
are leading those efforts in the States for public safety and
for FirstNet are a critical component. They are truly the tip
of the spear of what we're trying to enable, and the
partnership is very, very important to us. We spend a lot of
time trying to overcommunicate to the States. We don't view
them as constituents, but they are critical partners, just like
public safety and just like our Federal partners.
Senator Schatz. Thank you. And to General Logan, and this
is to the question of opting in versus opting out. What Mr.
McLeod said was essentially that under the statute, opting out
is a mirage. I don't know if that's an overstatement or not,
but that's the gist of it, it is very tough to opt out. So I
want to actually focus on opting in. I understand you went
through a pretty good process with Governor Ige and your team.
And I would like you to kind of explain how you came to opting
in and how much support you thought you got from FirstNet in
that process.
General Logan. Senator, thank you very much for the
question. I would say, going back to one of your--the earlier
question, when FirstNet came out to brief the Governor's
Cabinet, I kind of got with the team beforehand and I sat down
and gave some of the interesting nuances of localism and how
we, in Hawaii, perceive people that come from D.C. into our
state, and I asked them not to wear a suit and tie, I asked
them to come in an Aloha shirt when they briefed the Governor,
and they did that. And so that kind of warmed over the crowd.
Senator Schatz. We appreciate that.
[Laughter.]
General Logan. Yes. But also back to this question, I think
after they presented to the Cabinet, the Governor and I and
Todd Nacapuy, the State CIO, we got together and we kind of
went through it pretty quickly, and the Governor's background,
I think being a telecommunications engineer and working for
telecom companies in the state, I think it was kind of obvious
to him that opting in was probably the best solution, although
we have not made a final decision. We wanted to wait to see
what our state plan is.
Part of the issue the states are having, I think, or at
least some of the anxiety the states are having, is we don't
know what the RFP is yet, we don't know what the State plan is,
so we can only guess at how we can--or what we think is going
to happen. So without all the knowledge, it creates some
anxiety, so states are somewhat unprepared for what may happen.
But I think we're a lot better off than we were with all the
communications going on, and FirstNet would be the--they'll--
they are an overabundance of communication. If you need
something, they will answer your questions. And so they're very
receptive to at least--I know in my State they are, and we have
a conversation with them.
And so I think, looking at it from the State's IT
perspective, what we haven't done yet and what the State CIO
and I have discussed a couple weeks ago, was meeting with some
of the local vendors within the state, like your Verizons, your
AT&T, and just kind of talk through that to see what their
perspective is, and maybe we could do it all by ourselves, but
I don't think we're there.
Senator Schatz. Can you talk a little bit about--I know
you've had meetings with other non-contiguous States, but I
think some of these concerns that come through the non-
contiguous states affiliation also apply to a lot of our rural
areas in the continental United States. Can you talk
specifically about what the technical needs are and then how
you see the kind of revenue distribution and maybe very
quickly, General Logan, so I can hear from Mr. Poth as well.
General Logan. OK. Well, I have talked to the fellow SPOCs
from the other states that are non-contiguous states, and we
all have generally the same issue. It's we have, you know, like
Oahu is your center of the city and county of Honolulu. That's
the major metropolitan area, almost a million people live
there. But the neighbor islands, not that many, I think we have
140,000 on the big island, maybe fifty to sixty thousand on the
island of Kauai, and close to a hundred on Maui. So how do we--
they are generally rural areas, and so how do we guarantee
coverage?
One of the things I look at FirstNet is if it's good for
the city cop, it's got to be good for the rural cop, firemen,
and EMT. So we can't say, well, because you live in the city,
you get first priority and we're going to get these guys last.
That's not a fair system across the board. So we've got make
sure public safety is covered across the board.
Senator Schatz. And, Mr. Poth, we have your commitment to
work on these issues, not just for non-contiguous states, but
for rural areas across the country?
Mr. Poth. Absolutely, and that's a basic premise of our
revenue-sharing model.
Senator Schatz. Thank you.
Senator Wicker. Thank you.
Senator Gardner.
STATEMENT OF HON. CORY GARDNER,
U.S. SENATOR FROM COLORADO
Senator Gardner. Thank you, Mr. Chairman. And thank you to
the witnesses for your time and testimony today.
Obviously, the potential to revolutionize public safety
communications is extremely important. I'm very excited that
FirstNet shows Boulder, Colorado, as home of its technical
headquarters. It's a great tech community in Colorado, a great
tech corridor. Just down the road from FirstNet in Boulder, of
course, is the National Institute of Standards and Technology,
which is doing great work on public safety communications
research at the Communications Technology Laboratory, so we've
got a great tech and vibrant economy running in Colorado, and
we appreciate you being there.
Mr. McLeod, I want to start with you first. You, in your
testimony, talked about FirstNet, ``must view states as
partners rather than constituents in the consultation process''
and mentioned that some states don't believe FirstNet is
interested in developing genuine partnerships with the states
is how you said it. So following up on a little bit of what
Senator Schatz was talking about, could you talk a little bit
further about that point and talk about the nature of the
meetings that you mentioned and that that nature that have
caused the concern in developing those genuine partnerships,
that desire to create them, and then talk about the obligation
to take that state advice.
Mr. McLeod. Thank you for the question, Senator. So I
think--I will say that FirstNet stepped up their efforts over
the last year to communicate with states, and as the General
said, if there is a question that States have, they've been
more than willing to answer those questions. I think my
statement reflects the feeling among states that although they
may be complying with the letter of the law, that at the end of
the day, states don't feel that they are necessarily viewed as
full partners.
And maybe just as a quick example, during the development
of the State plan, states will be seeing drafts of those plans,
but the final plan that will be submitted to them, they will
not have an opportunity really to suggest revisions or at least
that many revisions would be made. So I think that goes to the
sense that were it a true partnership, that states would be
more engaged in the development of that plan beyond just the
consultations that have been happening.
Senator Gardner. Please continue if you have anything else.
Mr. McLeod. No.
Senator Gardner. Mr. Poth, do you want to respond to that?
And then I can get back to you with an additional question.
Mr. Poth. Sure. Part of the thing that we have to do with
the State plans is we're going to be at that point under a
contract with our partner. We have submitted into the RFP all
the State data unfiltered, what each State and territory felt
was important. We're expecting the vendor community now has
responded in each particular state how they would go about
deploying the network in that state, the random radio access
network.
We are then, as Mr. McLeod said, planning on giving a draft
to the states so that they have plenty of time to understand
the coverage, the cost, and what is being proposed. There are
opportunities for feedback, but we are going to have some
limitations since it will already be under a contract term as
to how much variations, if a state felt it was important, but
it is our commitment, as we've always done, to work with the
States, and we want to provide that before we turn and have the
state plan go final, which then starts the 90-day clock for the
Governors because we don't want the states to be surprised at
what the plan is with our partner.
But Mr. McLeod is correct. There may be some limitations as
to what changes could be done from the draft to the final.
Senator Gardner. And I think one of the concerns that we
have, of course, in Colorado is the geography and the
limitations that geography can pose to coverage and the
challenges it can pose to that coverage. So are you concerned
at all that the approach that you're talking about would--
you're not concerned that it would undermine the State
consultation process then.
Mr. Poth. No.
Senator Gardner. And if first it's not relying on that, if
you end up with this time crunch that Mr. McLeod is talking
about, though, and that you just identified, and you have these
unique challenges to geography in the states, who are you
looking for, for the expertise then to fill the gap to make
sure that you don't have a problem?
Mr. Poth. So if we're in the State of Colorado, for
example, all the data and what the State committee felt was
important, and public safety, what they felt important, was
submitted to the vendors, and it's in the reading room, so they
understand what the state's position is and what's important
both in the urban and the rural areas, and the Rocky Mountains
and those types of areas.
What we're expecting back is how the vendor is proposing to
facilitate all of that both with terrestrial and possibly with
deployable coverage and what that scenario and the phasing and
the build-out would look like for the state. We continue to
work with all of the states, and we want to make sure that they
understand, you know, the limitations of what may be possible
from the contract, although we are absolutely committed to
maximize the value for public safety in the states. There will
be some limitations probably that we'll expect, but we're going
to continue to work with the states.
And the other important thing in the room is we're
envisioning--and this will be a 25-year contract--in excess
revenues, we are going to reinvest back into the network to
where we can advance technology, hopefully expand the rural
footprint, so it may not be day one that a state or a public
safety agency gets everything they want, but we do have a
mechanism in place to continue to fund, not only for our
financial sustainability, but to grow the network and with the
technology.
Senator Gardner. Mr. Chairman, can I ask one follow-up
question to what he just said?
Senator Wicker. Absolutely.
Senator Gardner. Thank you. With this revenue issue, and
I'm just curious, the prioritization of those funds, network
maintenance over network expansion, how will you make that
determination?
Mr. Poth. As the excess spectrum funds come in, we're going
to be evaluating what's the latest technology. We're building
in the contract that we're expecting our partner to evolve and
change as the technology without us funding that. That is just
part and table stakes for part of this contract. We'll then
evaluate what the priorities are with the technological
advancements or possibly coverage advancements.
Senator Gardner. Thank you, Mr. Chairman.
Senator Wicker. Thank you.
We now--we have Daines, Fischer, and then Manchin.
Senator Daines.
STATEMENT OF HON. STEVE DAINES,
U.S. SENATOR FROM MONTANA
Senator Daines. Thank you, Mr. Chairman.
I think in places like Montana technology really removes
geography as a constraint. This extends not only to our
businesses and our schools, but, of course, to first responders
as well. And it's especially important in states like Montana
and states like Colorado where we have significant rural areas,
first responders can be 50 miles or more away from an accident.
So the goal here, I understand, is to provide coverage in 99
percent of the country. As we've seen with mobile wireless
coverage, the remaining 1 percent of the country often includes
places like Montana.
Mr. Poth, tell me about the future plans, if any, to
eventually cover that 1 percent of the country.
Mr. Poth. We hope to--to expect 100 percent coverage is
probably a very steep mountain to climb, no pun intended. With
the coverage that's required, we're really expecting industry
to come back and the technology to evolve to where deployables,
satellite technology, and those types of things will enable
public safety, especially in remote areas, to still maintain
connectivity. The goal of getting to 100 percent coverage
throughout the 56 states and territories I think is going to be
a pretty aggressive goal.
Senator Daines. And related to the issue of technology--and
I spent a lot of years in the technology business, where it
moves at the speed of business versus the speed of government--
as you think about the future of where it's headed, how will
you keep at FirstNet as it relates to when technology changes?
About the time the project is completed, I'm guessing
technology will be well ahead of where you end.
Mr. Poth. Right. And that's one of the big focuses and
basic tenets of us. As an independent authority, we are going
to continue to grow and we are going to continue to push
technology. The mention of our labs in Boulder, we are going to
be advancing and trying to push public safety innovation and
technology for years to grow and with the NIST lab also focused
on that, we believe that we are going to be able to optimize
the benefits to public safety of what's available.
If you can envision, we don't even know what technology is
going to be like in 10 years. I often think--people will say,
well, your Android or your iPhones, that was the cutting edge
technology, because it is going to go so fast. We're going to
have in the contract the ability to grow and push the
technology as it goes from 3G, 4G, to 5G, and grow with it, and
we're going to have the organization in place to remain the
advocates and stewards for public safety with our partner so
that they don't lose focus on what's important.
Senator Daines. We heard today that FirstNet plans to use
fees generated from densely populated areas to help fund the
build-out in more rural areas. We've had similar funding
programs like the Universal Service Fund in place since the
1990s, and we still haven't achieved universal service. How is
FirstNet's plan different? And why is your plan going to
succeed when others haven't?
Mr. Poth. We have a pretty focused mandate and mission,
it's to serve public safety regardless of jurisdiction,
regardless of state, and so that's one of our driving forces.
The other thing that we are going to do is we are going to
remain responsible and accountable to public safety. They're
not going to let us allow for anything less than that. And our
independent board that oversees FirstNet is also going to
ensure for years to come that we don't lose focus on what the
investments and what the priorities are.
Senator Daines. As you can imagine, the broadband and the
wireless coverage that we do have in Montana is often provided
by our rural telecom providers, so I certainly appreciate the
requirement that the prime contractor partner with these rural
companies. But it's still unclear to me what accountability
measures FirstNet has in place to ensure that these
partnerships happen with these rural teleco providers.
So maybe you can elaborate what plan FirstNet has in place
to ensure that the prime contractors follow through on its
commitment to partner with the rural providers.
Mr. Poth. Once we have the bids that are submitted in and
evaluated and we get to a contract award, we are going to have
specific milestones both on the rural partnership participation
and the coverage. Then those milestones become measurable that
we are going to enforce, and we try to incentivize through the
contract the right behavior, but there are disincentives to
ensure that our commercial partner is achieving the coverage
and the cost control measures that we've asked for.
Senator Daines. Now, I understand the selling excess
network capacity is key to paying for the network. How will
FirstNet ensure that selling its capacity does not end up
competing with our existing providers?
Mr. Poth. We believe with the infusion of the new spectrum
and the needs of spectrum throughout the country and all
different bands, we think that there is going to be sufficient
demand on all the spectrums where we don't believe that that
will be necessarily a competition or a takeaway for those
providers.
Senator Daines. All right. Thank you, Mr. Poth.
Thank you, Mr. Chairman.
Senator Wicker. You know, it occurs to me when Members come
before this committee, they're going to get a lot of questions
about rural areas, and it just makes me feel very good about
the brilliance of the Founding Fathers. They created a Senate
that wasn't totally population based. And it's my pleasure to
recognize now the Senator from another rural state, Senator
Fischer.
STATEMENT OF HON. DEB FISCHER,
U.S. SENATOR FROM NEBRASKA
Senator Fischer. Thank you, Mr. Chairman. And I won't let
you down, I have a couple more questions about rural areas.
[Laughter.]
Senator Fischer. So, Mr. Poth, I've heard concerns from
stakeholders in Nebraska that FirstNet is going to rely heavily
on what's referred to as deployable networks in rural areas
rather than deploying a fixed network. For example, instead of
building a tower in the Nebraska panhandle, perhaps FirstNet is
going to bring in a communications vehicle to provide temporary
coverage during an emergency.
When we look at tornadoes and fires, all these emergencies
that happen in very rural areas, how can we be assured that
these deployable networks are really going to be a viable tool
for our first responders, and can they move quickly enough to
be useful during really these very, very critical times when we
have to have a quick response?
Mr. Poth. Right. What we did with the RFP, with it being
objectives based, we asked--one of the particular objectives is
rural coverage, and we have asked industry, ``You tell us what
is the best way to solve that requirement.'' It could be
deployables, it could be terrestrial. We don't know how they
have come up with the answer yet, but when we get to that
point, that could be part of the solution set, but we're asking
industry to do what they do best, come up with the most
creative solution to solve and that, as previously discussed
and pointed out, and hopefully industry has been listening for
the last 3 years, rural and rural coverage is a significant
component to the success of this network. So we're hoping and
very optimistic that there will be some solutions that can
address some of those concerns.
Senator Fischer. And we've also heard some concerns from
stakeholders about the deployment of the broadband network that
could possibly result in overbuilding, especially of existing
commercial networks, and in Nebraska, you and I discussed this
previously, that our telecommunications carriers are doing a
really good job of bringing service to our rural areas and our
underserved areas. Do you have any specific steps that FirstNet
is taking to ensure that this overbuilding or what I would
consider maybe an inappropriate use of limited funds, might be
addressed?
Mr. Poth. We're not expecting nor anticipating an
overbuilding, even in the rural areas. If you envision what is
happening in technology today, you've heard the term ``Internet
of Things,'' and the number of devices that are going to be
required to have access to a spectrum, not to mention,
obviously, our most important customer, public safety. So we
believe as devices and the Internet of things, Internet of
public safety things, grows, that the spectrum needs that are
currently in use will be saturated. And then also with our--the
additional Band 14 that will come into place will just
complement that.
Senator Fischer. OK. Mr. McLeod, have you heard anything
from Governors that are concerned about maybe overbuilding
existing commercial networks?
Mr. McLeod. Thank you for the question, Senator. I think
the big concern for Governors is making sure that to the extent
possible, using existing resources and infrastructure to build
out the network, just to be mindful stewards of taxpayer
dollars. I have not heard specifically that that is a big
concern for them.
Senator Fischer. OK. And, Mr. Katsaros, in your written
testimony, you list FirstNet's operating expenses for Fiscal
Years 2012 through 2015, and you note that while FirstNet spent
less than $250,000 in 2012, it spent $17 million in 2013, $24
million in 2014, and $49 million in Fiscal Year 2015. Can you
please clarify if all of these numbers reflect spending that
would be considered administrative expenses under the Act? And
if so, does this upward trend in funding not suggest that
FirstNet is going to exceed its allowable authorization for
those administrative costs? And what's going to happen in case
it does?
Mr. Katsaros. Thank you for the question. That's an
excellent question. Those costs, per our understanding, those
are the total costs, so they are not their administrative
costs. Their administrative costs are much less than that. They
have been trending over the 10-year period at less than $10
million already, so--but there are no concerns on that area at
the moment.
Senator Fischer. So that should be within the $100 million
that's been authorized then if that current trend continues for
the administrative costs. Is that correct?
Mr. Katsaros. Correct. They are under--they are well under
that.
Senator Fischer. And, Mr. Poth, do you anticipate that that
will happen, that you will be under that $100 million?
Mr. Poth. We will absolutely be under that $100 million.
Senator Fischer. OK. Thank you very much.
Thank you, Mr. Chair.
Senator Wicker. Thank you, Senator Fischer.
Mr. Katsaros, the 2012 Act established FirstNet as an
independent authority within NTIA. Is that, in fact, working
out? How is that arrangement working? And what, if any, role
does NTIA have?
Mr. Katsaros. Yes, thank you. That's another good question.
We are not aware of another independent authority that is
housed within a Federal department other than FirstNet, so when
it was created as----
Senator Wicker. It doesn't compute to an IG----
Mr. Katsaros. Correct. It did not initially. So when we
were confronted with an oversight challenge, we were informed
that this is an independent authority under NTIA, the National
Telecommunications and Information Administration.
So it maintains some of the sort of capacity,
administrative capacity, of the NTIA. It allows it to partner
with NTIA, allows for us to partner with NTIA, and initially it
caused us to sign a Memorandum of Understanding to fund our
oversight activity for FirstNet, which we have now canceled,
and now we are considering FirstNet under our general
appropriation for funding oversight. But the relationship with
NTIA exists, and it is part of the law, so we work with both
offices.
Senator Wicker. Were you referring to the MOU with Commerce
OIG?
Mr. Katsaros. Correct.
Senator Wicker. OK. Well, OK, now, as I understand it,
FirstNet and Commerce OIG agreed to terminate the memorandum of
understanding because FirstNet felt that all of the issues had
been adequately addressed. Are you satisfied that that in fact
is the case?
Mr. Katsaros. Well, I don't believe that all of the issues
would have been adequately addressed. I believe what the
cancellation of the MOU was contemplating was that all of the
requests for services that were originally considered under the
MOU had been addressed. So to the extent that the request,
FirstNet's request, for OIG services were included in that MOU,
those services have been--we believe those services have been
completed. There are many, many more things obviously to do
from an oversight perspective of FirstNet that are still to be
accomplished.
Senator Wicker. Mr. Poth, would you respond particularly
with regard to this independent authority aspect of my question
just now?
Mr. Poth. Yes. So while we enjoy certain rights with the
independent authority, we do find ourselves from time to time
bogged down with some clunky, well-intended Federal processes
that do not enable us to remain as quick and nimble and agile
as we need to be, you know, for the true public-private
partnership. We've had a lot of success sometimes by brute
force to work around within the rules.
A lot of times people confuse our need for independence as
clouded as that we are trying to not be accountable or
responsible, and that's not the case. We have to move very
fast. As the Senator earlier mentioned, technology and
technology companies are moving very fast, and to be a true
private-public partnership, we're going to still need to have
more streamlining and more of the constraints that sometimes
placed upon an agency within another agency have. So we
continue to work with Commerce and with NTIA to streamline
those areas, but it is still sometimes constraining.
Senator Wicker. Would it be fair to say that there's a
difference of opinion between your shop and NTIA as to what
that term actually means, ``independent authority''?
Mr. Poth. I don't think there's necessarily a difference of
opinion, it's a difference in how it needs to be applied,
because NTIA has been a great partner, but they also feel that
they are responsible since it is within their organization. So
that conflicting wording sometimes creates a little havoc.
We've been very successful working in partnership with them,
but it does add sometimes additional layers of oversight and
checks that sometimes we don't believe necessarily is going to
help us get to the value add. We certainly welcome and always
will respond to being responsible and accountable for all our
actions, but we do look forward to continuing to work with them
to streamline it.
Senator Wicker. I don't want to start a fight----
[Laughter.]
Senator Wicker.--but I think you said there was a
clunkiness.
Mr. Poth. Yes.
Senator Wicker. I think it would be helpful if you
enlightened the Committee about that. What would be an example?
Mr. Poth. Well, there are certain processes. For example,
when we submit our annual report to Congress, which is a
requirement, and there are up to 10 agencies that this gets
circulated and signed off before we can hit the Send button to
your offices. We welcome additional recommendations in
oversight on certain things and participation, but that
introduction of a delay of X amount of time, while it's not
fatal, it does push against reports and obligations. If you
envision next, as we work in partnership with our private
sector partner as we deploy this nationwide network, as certain
twists and turns come up with any major effort like this, if we
have that same sort of process to make sure that everyone is
comfortable with the decision, that clunkiness may result in
some certain delays where decisions need to be made, you know,
in a more real-time fashion.
Senator Wicker. OK. You know what? I'm going to give you a
chance to expand on that answer for the record, and you'll be
able to choose your words. But, again, I'm not trying to create
strife here.
Mr. McLeod and General Logan, I think I've characterized
Mr. Katsaros's testimony as correctly as saying that there are
shortcomings and that FirstNet needs to step up its game. Would
either of you care to respond to the testimony from the IG as
to some of the challenges that he has outlined?
General Logan. Sir, I'm not sure I really understand the
question.
Senator Wicker. OK. Well, let me ask you this, Mr.
Katsaros, have I mischaracterized your testimony? It seems that
your testimony is that you have some serious doubts about this
all coming together as planned and required and as written on
paper. Is that correct?
Mr. Katsaros. I think that's fairly well summarized. I
think there are still a lot unknown especially in this pre-
award phase. And then with respect to your comments earlier on
internal control, in a lot of ways, FirstNet is still a startup
organization, and they experienced sort of the typical
operational challenges that a startup organization would
encounter. And I do appreciate working with FirstNet that they
have adjusted and made those changes that were necessary to
kind of move them forward so that it's not a distraction, and I
think that's the important thing, that these operational
challenges and acquisition challenges and procurement issues
are not a challenge as they try to do this important work.
Senator Wicker. Are you optimistic that the goals could be
met this year?
Mr. Katsaros. That's a great question, and it's going to be
very difficult to answer. Like we keep talking about this pre-
award phase in our office, and during this phase, we're looking
at a November 1st timeline. We state that that is aggressive.
This is going to be--consultations in several phases are going
to be ongoing over the next several months, and there are a lot
of variables that need to fall in place for this to be
successful. So it's a great question.
Senator Wicker. Let us know if the Committee can be
helpful.
Now, do either of you care to respond to that? If not,
we'll----
Mr. McLeod. Sure.
Senator Wicker. Yes, Mr. McLeod.
Mr. McLeod. To your original question, I can say that
Governors are fully committed to this being successful, and
they pushed hard to get the legislation passed in 2012, and
they want to see this work and be successful.
I think certainly going forward a big question is just the
unknowns. There is--this is--as I said, this is unprecedented
in terms of its size, complexity, and scope. So to the extent
there are unanswered questions about, for example, Can it be
built within existing cost models? What will the user fees be
to connect to the network? And are there any long-term
administrative and operation costs that States are looking at
that maybe aren't anticipated right now?
So I think with just keeping in mind that States want to
see it successful, just concerns about just the unknown, and
until they get that State plan at the end of this year, States
are going to probably hold back and wait to see if they want to
opt in or opt out.
Senator Wicker. Thank you very much.
I had a hint that Senators Blumenthal and Klobuchar might
be on their way.
Senator Blumenthal.
STATEMENT OF HON. RICHARD BLUMENTHAL,
U.S. SENATOR FROM CONNECTICUT
Senator Blumenthal. Thank you, Mr. Chairman, and thank you
for enabling us to participate.
Senator Wicker. We learned quite a bit actually.
Senator Blumenthal. So I gathered. Thank you.
[Laughter.]
Senator Blumenthal. And the reason is it's--we have a very
distinguished panel, and thank you for having this hearing and
thank you all for being here today.
I don't need to tell anybody here that during emergencies,
local resources are strained and communities depend on the
support of outside organizations in addition to first
responders, the United Way, the Red Cross, all kinds of
organizations that play a vital role in protecting property and
restoring and maintaining the health and safety of individuals.
One example, when Connecticut's shoreline was ravaged recently
by Superstorm Sandy, disaster relief organizations mobilized
quickly, they helped displaced families, they provided them
with food and shelter, and the nonprofit United Way of
Connecticut supports the state's 2-1-1, a 24/7 Health and Human
Services information referral helpline, which plays a critical
role in the kinds of emergencies that we encountered in
Superstorm Sandy, and other disasters or emergencies. Whether
it's snowstorms or hurricanes, floods, clearly there's a need
for such organizations to have access to a dependable national
public safety broadband network in order to operate as
effectively as possible.
But I understand that the states currently lack clarity as
to what entities will be able to use FirstNet. I'm concerned
about that fact. In fact, according to the statute, all,
``public safety entities,'' shall have access, but it's not
clear what that term means, ``all public safety entities.''
So let me ask you, Mr. Poth, in addition to our first
responders, which is law enforcement, fire, EMS, police, what
other entities are encompassed in the definition of ``public
safety entity''? Would it include in Connecticut our United
Way, our Red Cross, our community organizations, and the like?
Mr. Poth. Thank you very much for the question. That's a
great one. What we've done, and you're correct, the definition
is in our statute, and we've leaned upon our Public Safety
Advisory Committee led by Chief Chairman Harlin McEwen to help
us sort through some of these questions, and as that relates to
what's called local control, we've asked them--they represent
40 public safety agencies and associations, international
chiefs of police, IFF, international city/county management
associations, volunteer firefighters, ``What would be, based on
public safety's needs, the hierarchy of control?''
So everyone will have access to the network. Where it
becomes important is, What is that priority? You mentioned some
of the three traditional, police, fire, EMS, and it can also
extend to hospitals all the way down to schools and to those
volunteers.
So they're helping us work through that as to what is
important for local control, and then when we work with our
partner, those things will be kind of set up. I think they have
up to 19 tiers of priority that they've identified through
local control, because you're exactly right, Senator, in a time
of crisis, it's not just the first responders that are needed,
it is a true community-wide effort that relies on both public
and private partnerships volunteers to be an integral part of
that response fiber.
Senator Blumenthal. And the structure or fabric of an
emergency response also includes hospitals, health care
providers, transit authorities, and so forth. They are public
safety entities in a sense as well.
Mr. Poth. Oh, absolutely. There are states that have
already standing agreements with bus companies if they have to
move mass quantities of people out of their area due to
flooding and those types of things. That becomes part of the
response fabric that you mentioned.
Senator Blumenthal. Let me ask you in the short time I have
remaining, at the last hearing on FirstNet, I asked, What can
be done to make sure that FirstNet is not hampered by a
sluggish hiring process, I don't know whether you recall that
question, and that it has the authority needed to hire the best
and the brightest most efficiently? And I would like to revisit
that question. Have your hiring processes changed or improved?
Mr. Poth. Yes, they have improved, and we like to think
that we do have the best and brightest that we've brought to
bear. Our technical and our operational and management teams
are, I would say, second to none. We do have some of the
traditional challenges in the Federal system, but we have
developed, working closely with the other agencies and human
resources, to streamline that as effective as possible. But we
are, you know, competing with a commercial market for some of
that talent. We've been very lucky. Because of the mission and
the passion our employees have for this mission, that it has
become an easier sell.
Senator Blumenthal. Thank you very much. And, again, my
thanks to this panel for your contributions to this area of
public policy and for your being here today. Thank you very
much.
Mr. Poth. Thank you.
Senator Wicker. Thank you, Senator Blumenthal.
Senator Klobuchar.
STATEMENT OF HON. AMY KLOBUCHAR,
U.S. SENATOR FROM MINNESOTA
Senator Klobuchar. Well, thank you very much, Mr. Chairman.
And thank you to all of you. I'm sorry I wasn't here earlier.
We have the Canadians in town, and Senator Crapo and I head up
the Inter-Parliamentarian Group. And actually I have a Canada
question to cap that off.
But this means a lot to me, this issue. I'm a former
prosecutor. Senator Burr and I head up the 9-1-1 Caucus and
Next Generation 9-1-1. You know, we've worked hard to update
some of our systems and make them more interoperable. This was
really called home in my State when we had the I-35W bridge
collapse. Despite the fact that there were dozens and dozens of
cars in the water when an eight-lane bridge collapsed in the
middle of one of the biggest rivers in the country, 13 people
died. It could have been so much worse if not for our emergency
responders. And I think what doesn't always get a lot of
attention was the reason they were able to get people to safety
and get them to hospitals so immediately was that the
Minneapolis Emergency Community Center--Communications Center
received and processed over 500 calls, 51 of which came
directly from the scene of the disaster. Seventy-seven men and
women were handling those calls, and, of course, no warning
whatsoever, not even the warning you would have with a storm,
and were able to get those people help. It's an incredible
story of work that had been done for years leading into it
anticipating some kind of a disaster between our area
hospitals.
So my first question would be about interoperability. We
had a major shooting of a police officer, and it really changed
the way we looked at it because when the police from many
jurisdictions were chasing the deranged man who had killed the
police officer, they were using 13 different systems, and many
of them couldn't communicate with each other. And so that
really spurred us on to make some changes. And I know that
we've been working on this since 2004.
Mr. Poth, what guarantees can you give the Committee that
the feedback gathered from stakeholders in State consultations
as States are developing these State plans will be
incorporated? And how will FirstNet respond as States continue
to gather and provide updated data?
Mr. Poth. Great. Thank you so much for the question. And
just those two small examples demonstrated the need and why
public safety demanded that this network and that FirstNet
deploy this network. What we've done is in the State
consultations and the outreach to both the States, to cities
and counties and public safety entities, is make sure that they
understand the value proposition and the interoperability that
is the cornerstone of what we are trying to accomplish with
this network. The interoperability even with Canada will be
critical because of the border States and those needs and
initiatives.
We're expecting that as we continue even post-acquisition
and award, to continue the consultation and champion the cause
for the States and for public safety with our partner and in
the technology world to keep pushing advancements. You
mentioned the dependency and interconnectivity with the
dispatch centers. The public safety answering points are key
components into that first response on a lot of different
incidents, and we work closely with APCO and NENA to make sure
that their efforts and what's going on with NG9-1-1 is closely
tied into what we're trying to accomplish with the broadband
network.
Senator Klobuchar. Well, and since you brought up Canada,
thank you, so I can report back to our 15 members of the
Canadian Parliament who are in town.
[Laughter.]
Senator Klobuchar. Obviously, we're concerned about the
level of interoperability since we are right on the Canadian
border in Minnesota, as are so many of our States, and you've
got the Great Lakes right there, and there's a vast expanse
between our two countries. And could you give us an update on
the coordination between the two countries and these border
areas?
Mr. Poth. Yes. We spend a lot of time with our Canadian
counterparts updating them on our progress and what they're
doing. We also have the luxury with Canada in that the Band 14
spectrum is the same bandwidth that they also have allocated
for their public safety. So although I get outside my comfort
level on the technical side, I believe that makes it even more
seamless. But we have ongoing exchanges and updates with the
Canadian team as they are trying to implement this on their
side to ensure timely response for both parties.
Senator Klobuchar. Thank you.
Mr. McLeod, Sheriff Stanek of Hennepin County, our biggest
county in our state, serves on the FirstNet board representing
law enforcement. And are there some specific needs that
firefighters hope to see incorporated into the design of
FirstNet? And what do you think can be done to incorporate some
of the law enforcement and firefighter concerns?
Mr. McLeod. Thank you for the question, Senator. I think
states certainly look to the network as being available to a
wide range of first responders, so that would include fire,
police. I think that goes back to making sure that there is
real value there and that they demonstrate the value to States
and to those first responders.
Senator Klobuchar. Thank you.
I just had one last question, and maybe I'll put one more
on the record.
But I'll get back to you, Mr. Poth. Newcore Wireless, which
is based in Saint Cloud, Minnesota, recently participated in a
pilot project with FirstNet in Elk River. The pilot project
tested a public safety LTE network in urban and rural areas,
and I'm glad that you're looking at those partnerships with
rural companies, that's where a lot of our gaps are. I've seen
this, and we've got--you know, it's everything from a major
case of a fugitive to someone with a snowmobile that broke down
in the middle of--and it's a small thing, but it's not a small
thing because they are completed isolated and they can't get
through even though they have a cell phone.
And it's my hope that FirstNet will not only share the
public safety community--serve the public safety community but
can also share and spur on these kinds of additional wireless
broadband and infrastructure deployment like we've seen in this
pilot. Could you talk about this pilot in particular and what
you learned from it?
Mr. Poth. The particulars I'm not exactly up to speed on,
but I do know that we use that, as we've done with all the
early builders, as lessons learned, and we incorporate every
one of those events, and we take copious notes to make sure as
we work with our new partner, still yet unidentified, to learn
from those lessons as we begin the deployment into the Nation.
We also are expecting, as you've already noted, through the RFP
process, the rural partnerships to be clearly articulated, and
the value proposition to go out to the rural areas will be
clearly stated in all the State plans.
Senator Klobuchar. All right. Very good. Well, thank you.
Thank all of you for your good work.
Mr. Poth. Thank you.
Senator Klobuchar. Sorry I didn't get to everyone, but the
Canadians await me. Thank you.
Senator Wicker. Thank you, Senator Klobuchar.
And thank you, gentlemen. I think this has been a very
knowledgeable panel and a very enlightening hearing. Thank you
very much. And the hearing is closed.
[Whereupon, at 10:51 a.m., the hearing was adjourned.]
A P P E N D I X
Prepared Statement of Hon. Bill Nelson, U.S. Senator from Florida
FirstNet is at a critical juncture. The nationwide network is
closer to reality than ever before, and yet much remains to be decided.
Just a few weeks ago, FirstNet received responsive bids to its requests
for proposal (RFP) for deployment of the network. The carefully crafted
RFP, which was the result of extensive preparation and consultation,
set forth detailed objectives for the first responder network that any
private sector partner has to meet. I know we are all anxious for
FirstNet to complete its review of those bids--something it plans to
accomplish before the end of this year.
We are not allowed to know the number of bids FirstNet received,
nor the specifics of those bids. Indeed, Mr. Poth cannot give us any
insight into those bids while we are in this sensitive review period.
We all want to know how the private sector responded to the RFP. What
do the bids say about how rural areas will be covered? How will
FirstNet become self-sustaining? What insights can the bidders provide
about how the network will be deployed in states and territories? These
are all questions for another day. In fact, one wonders about the
timing of today's hearing given the legal and practical constraints on
all parties, including FirstNet, who can offer the most insight about
network planning and other questions.
Broadly speaking, the legislation creating FirstNet built in a
great deal of flexibility in how the network was to be deployed,
leaving actual implementation to the private sector partner. The RFP
rightly set forth broad objectives to meet the statutory directives,
but leaves the details to the private part of what will be the first-
of-its-kind, public-private partnership. Selecting a private sector
partner likely will not be easy. Will FirstNet's eventual decision make
everyone happy? Of course not--that's a given. But is it critical that
we get this done? You bet.
When we came together in a bipartisan way more than four years ago
to take the important step of creating FirstNet, it was because we knew
we needed to give our Nation's first responders--who put their lives on
the line each and every day--the tools they need to communicate
effectively during emergencies. Governors, mayors, and public safety
officials from across the country all joined us to put aside individual
parochial concerns and recognize that we all had to work as partners to
create a new paradigm if we were to make a truly interoperable network
for first responders a reality.
As it's taken several years to get to the RFP stage, that
collective will in support of FirstNet may have faded into skepticism
in some corners. I fear that some may try to exploit such feelings at
the expense of our Nation's first responders. Now is not the time to
jump to conclusions or make rash decisions with regard to FirstNet. The
process Congress created is working and we will soon know the
parameters of the private sector's response to the RFP.
As I have said before, we knew the mission we gave FirstNet would
not be easy--but the stakes of inaction were too high. That's why we
cannot lose sight of what brought Congress to create FirstNet three
years ago--our nation's first responders deserve an advanced nationwide
interoperable wireless broadband network to help them do their jobs to
protect us all.
______
Response to Written Questions Submitted by Hon. Kelly Ayotte to
Michael Poth
Question 1. Since our last oversight hearing, we have seen
increasingly advanced cyberattacks target major companies, government
agencies, and critical infrastructure owners and operators around the
world. Given these constantly evolving threats, does FirstNet have a
plan to ensure its cybersecurity strategy is able to keep pace with new
security innovations and technologies in order to remain relevant well
into the future?
Answer. Cybersecurity is one of the sixteen key objectives that
every offeror of the RFP must demonstrate to meet the requirements of
deploying the NPSBN. Included in a cybersecurity solution, an offeror
must provide an end-to-end solution for cybersecurity covering
everything from devices, to connectivity, physical security to network
operations, to applications and other software. The difference with the
NPSBN and other networks is that cybersecurity will be considered from
the very beginning of the network design, instead of in an ad-hoc or
patchwork way. This enables FirstNet and our future partner(s) to
consider how to approach threats like malicious attacks in ways before
the network is designed.
While there will be no perfect solution to cybersecurity, the
benefit of doing this with a private-sector partner is that we can
aggregate the lessons, processes, and responses from multiple agencies,
companies, and other sources, to become smarter, more proactive, and
better informed to protect the FirstNet network. FirstNet intends to
leverage expertise from the public and private sector for the benefit
of public safety.
The contract term is 25 years, and the RFP requires that the
partner show that it has a way to continuously upgrade, maintain, and
secure the network throughout the life of the program. FirstNet is
still evaluating RFP responses at this time and therefore cannot
discuss any specific proposed solutions to the NPSBN. Through the RFP,
however, FirstNet has communicated that it fully expects its future
partner to have solutions to all cyber threats, including malicious
attacks.
Question 2. Additionally, a key challenge to designing
cybersecurity into complex systems is doing so without negatively
affecting speed and function. Building a national public safety
broadband network presents similar challenges. How is FirstNet
designing a secure system that also preserves rapid response time and
robust functionality?
Answer. FirstNet staff includes those who have served in public
safety, from the wireless industry, and, in some cases, both. This has
given us the perspective to appreciate the technical challenges and
opportunities with deploying the NPSBN, while also focus on meeting the
needs of public safety. Through consultation, many States provided us
with case studies of how their first responders used data and wireless
technologies in everyday activities and during incident responses. This
was also extremely beneficial in helping us understand the particulars
of each State and geographical challenges that FirstNet will have to
meet.
During the New Hampshire initial consultation, the State shared the
challenges it faces when responding along its border and throughout its
rural and diverse geography. These comments will inform FirstNet's work
with its private sector partner(s) to help determine the best possible
solution.
We also understand there is a balance between accessibility, speed,
and reliability while still achieving security. We have looked at
commercial deployments of networks as examples and will be working with
our partner(s) to develop a secure network that is usable during
incident response. Over time, as we learn from our users about how they
have accessed the network, we will continue to work with our partner(s)
to improve how the network serves its users.
Question 3. I appreciate FirstNet's diligence to make sure rural
areas of the country have access to FirstNet, including the 15 percent
geographic requirement for prime contractors to partner with existing
rural telecom providers. I have noticed, though, that the 15 percent
rural partnership requirement will only be evaluated at a single
preliminary stage in the RFP selection process. How will FirstNet
ensure that the final accepted contract still includes the rural
partnership stipulation? And, once implemented, that the winning bidder
follows through on its assurance to partner with rural
telecommunications providers for at least 15 percent of the total
coverage nationwide?
Answer. Including rural coverage and rural providers are key
evaluating factors in the RFP. In the RFP, we ask an offeror to meet 15
percent of its nationwide rural coverage objective with rural
providers. When responding to the RFP, an offeror was to provide, on a
state-by-state basis, its proposed partnerships with rural providers,
and show that on a nationwide-level they met or exceeded the 15 percent
minimum target. Fulfilment of this requirement will be monitored
throughout deployment and over the lifetime of the contract with
FirstNet. The 15 percent rural partnership requirement was a minimum
threshold in an early stage of the evaluation process. However, that
was not the only time that the offerors' rural partnerships will be
evaluated. An additional evaluation factor for the RFP is the offerors'
rural partnerships over and above the 15 percent minimum threshold as a
means of fulfilling the utilization of existing infrastructure, as
mandated by Congress, which is one of the sixteen objectives outlined
in the RFP.
______
Response to Written Questions Submitted by Hon. Ron Johnson to
Michael Poth
Question 1. Mr. Poth, I have heard that FirstNet is ``ahead of
schedule and under budget'' as it moves to implement the Public Safety
Network. Is this true?
Answer. Financial responsibility is one of the key tenants of
FirstNet's obligations to deploying a nationwide network. In the Act,
FirstNet was given a one-time allocation of up to $7 billion as seed
capital and explicit direction that the network and our organization
are to be self-sustaining. To be solvent, FirstNet was licensed 20 MHz
of spectrum, has the ability to monetize excess spectrum capacity via
covered leasing agreements, and can assess certain fees (e.g., for
network use or access).
FirstNet has a responsibility to the American people, and public
safety in particular, to use these assets wisely. Every day FirstNet
does not provide service and maximize the spectrum availability is a
day lost to serving public safety and the communities they serve. And
for this cause the FirstNet organization is driven to fulfill its
mission, which fuels the urgency to deploy this network.
To date, FirstNet has stuck to our announced deadlines, outlined in
our publicly available roadmap, and remains within budget. Any delays
of the network would be a delay to serving public safety.
Question 2. Mr. Poth, can you commit that FirstNet has no plans to
seek additional funds, outside of what has already been authorized,
from Congress? Will FirstNet commit to a model that is self-sustaining
moving forward?
Answer. FirstNet commits to staying within our budgetary authority
and has developed a business plan that we believe will maintain
financial sustainability. Being self-sustaining is a factor in driving
the speed at which we are executing. We are extremely mindful of our
fiscal and legal obligations and do not intend to veer from those
responsibilities.
______
Response to Written Questions Submitted by Hon. Cory Gardner to
Michael Poth
Question 1. You indicated in your response to one of my questions
at the hearing that FirstNet will send states a draft plan so that they
``have plenty of time to understand the coverage, the cost and what is
being proposed.'' And you say further that while there is opportunity
for feedback, there will be some limitations since the plan will
already be under a contract term, but regardless, FirstNet will work
with the states. In light of those comments, do you agree that states
should have the ability to alter components of the plan if it will not
work for their state?
Answer. FirstNet's mission is to ensure the deployment and
operation of a nationwide, interoperable communications system for
public safety. This has been demanded by first responders, who desire
priority, pre-emption and expanded coverage from what they currently
have on existing commercial networks. As FirstNet has limited resources
to accomplish this mission, we aim to achieve the best solution for
public safety in every state and territory within our financial means.
This public-safety focused mission is at the core of FirstNet's
consultations with the States and is reflected in the request for
proposals (RFP) we issued this year, which seeks a nationwide partner
to deploy and operate this system.
FirstNet's goal is to provide the best possible network to meet
public safety's needs throughout the Nation. We have been working with
our State partners for the better part of two years to understand their
unique needs so that the State Plans reflect the desires of each State.
FirstNet intends to work with the RFP awardee to tailor the draft State
Plans to these State requirements as best we can. Our goal is to
produce State Plans that are a product of States' data collection
efforts, ongoing consultation activities, and coverage objectives
balanced with Congress' mandate for a self-sustaining network. Thus, it
is our hope that we can address issues identified by States, without
compromising the financial sustainability of the network, through a
draft State Plan process in consultation with our State partners.
Question 2. Does FirstNet intend to preempt any state and/or local
zoning or other laws in order to implement the network?
Answer. The Act does not contain any express exemption for FirstNet
from State and/or local zoning laws. Therefore, FirstNet's commercial
partner(s) will be expected to comply with applicable Federal, State,
and local zoning laws and their associated regulations. FirstNet will
work with States or localities that want to share information on zoning
requirements or associated regulations that may impact deployment,
operation, and maintenance of the network.
Question 3. Will FirstNet outline the secondary costs to states in
the state plan, including for example, the costs to connect a public
safety answering point (PSAP) to the network?
Answer. The State Plan will include information on the deployment
of the radio access network (RAN) within a State's geographical
boundaries. If a Governor chooses to opt-in to the FirstNet State Plan
or chooses to take no action at all during the 90-day Governor's
decision period, all RAN deployment costs will be borne by FirstNet and
not the State.
The State Plan will also outline and describe specific fees and
costs that a State would bear, if it were to opt-out of FirstNet's
State Plan and decide to deploy, operate, and maintain the RAN with
State funds. Due to the State having to then develop its own RFP and
execute its own procurement to bring on a private sector partner,
FirstNet cannot definitively know what the State's costs would be for
interconnection and interoperability before a State selects its own
partner.
Additionally, the State Plan will include the optional costs for
public safety entities to subscribe to FirstNet services if the network
meets public safety's needs and is determined by the public safety
entity to be its best choice for service.
Question 4. I know that there have been public notices and that you
have solicited feedback from states and interested parties throughout
the drafting process. Is that feedback available to the public? If not,
will it be made available? If so, when? If not, why not?
Answer. FirstNet takes transparency of its operational decision-
making very seriously, which is why it has frequently chosen to ask for
and has received public comments on its actions. The links below are
publicly accessible and represent examples of FirstNet's solicited
public feedback:
The Draft RFP documents are all public documents, along with
the answers and responses to over six hundred (600) received
questions. Those documents may be accessed here: https://
www.fbo.gov/index?s=opportunity&mode=form&tab=
core&id=3107e180a6f34e13df3f4fa7f86d55df&_cview=1
FirstNet's first public notice and associated comments can
be found here: https://www.federalregister.gov/articles/2014/
09/24/2014-22536/first-respon
der-network-authority-proposed-interpretations-of-parts-of-the-
middle-class-tax-relief
FirstNet's second public notice and associated comments can
be found here: https://www.regulations.gov/document?D=NTIA-
2015-0001-0001
FirstNet's third public notice and associated comments can
be found here: https://www.regulations.gov/document?D=NTIA-
2015-0002-0001
FirstNet's final interpretations and responses to associated
comments can be found here: https://www.federalregister.gov/
articles/2015/10/20/2015-26621
/first-responder-network-authority-final-interpretations-of-
parts-of-the-middle-class-tax-relief-and
https://www.federalregister.gov/articles/2015/10/20/2015-26622/
final-inter
pretations-of-parts-of-the-middle-class-tax-relief-and-job-
creation-act-of-2012
FirstNet solicited another round of questions for its final
RFP. The associated responses and changes to the RFP made
because of the public's immense response (400+ questions) can
be found here: http://www.firstnet.gov/news/firstnet-issues-
rfp-nationwide-public-safety-broadband-network
Question 5. Colorado is a state known for its outdoor recreation
and isolated population centers. With these facts in mind, Colorado
proposed that 97 percent of the state's area be covered under FirstNet.
I cannot blame my state for aiming as high as they possibly could,
thinking that FirstNet would propose something slightly lower that they
could agree upon. However, FirstNet ultimately proposed coverage of 24
percent of the state's land area. Did FirstNet take into account
significant outdoor recreation areas, seasonal population, or isolated
population centers when determining its proposed coverage area? Given
that Colorado is relatively unique in these respects, do you believe
that 24 percent of the state's area is a reasonable coverage goal?
Answer. FirstNet has not proposed any coverage to Colorado or any
state at this time. Partner proposed Coverage maps for each state will
be available after FirstNet has awarded a contract from its nationwide
Request for Proposals (RFP) and draft State Plans have been developed
and presented to each State. Current timelines estimate this date to be
in calendar year 2017.
In its FirstNet ``data collection'' submission, the State of
Colorado expressed its priorities for timing of the deployment and the
need to cover 97 percent of the state geographically. This data, along
with other states' data collection efforts, are in the RFP Reading Room
for each of the offerors to review and respond to, focusing on the true
needs and priority areas of each State. Because there are costs
involved in any network deployment and FirstNet must be a self-
sustaining entity, these priority areas were meant to help the
offerors' business planning needs so that the States' rural area
deployment priorities could be addressed in as near to the order
requested by the State as possible (for instance, some States
prioritized deployment in their rural State/national parks and
recreation areas before other rural locations due to the seasonal
visitor spikes that occur in the parks/recreation areas).
The stated ``24 percent'' coverage cited above was a starting point
for State to develop their Coverage Objective for the state and the
data collection that FirstNet presented to Colorado (and all other
States) based on known highways, population centers, and other public
safety needs. This Coverage Objectives baseline was then used by States
to supplement where they saw additional areas of needed coverage and
was not intended as a proposed coverage objective. This information was
presented to the bidder community to allow them to properly price the
network deployment in their proposals and to identify the cost
associated with the states desires.
Question 6. What are the options for a state that opts into the
network but then, prior to the expiration of the partnership contract,
realizes that it does not meet the state's needs?
Answer. The Act only contemplates a single Governor's decision once
presented with the final FirstNet State Plan. However, FirstNet intends
to work with States and their local/State public safety entities
throughout the 25-year contract, and further throughout the life of the
network, to ensure that FirstNet is meeting the needs of public safety.
FirstNet had developed a Chief Customer Office (CCO) position to ensure
that satisfaction with the deployment by subscribers to the network. It
is the FirstNet's goal to ensure that the provider is providing
superior service to public safety within each state but staying within
the fiscal limitations of sustainably. Even after the network is
deployed, there is no mandate for public safety or the States to use
the network.
Question 7. What mechanisms will be in place, apart from the
financial penalties identified in the RFP, to assure state and local
leaders that the public safety network will meet their needs for the
next 25 years? How will the operational and oversight models ensure
local responders will have a say in the evolvement and review of the
network performance (upgrades, expanded coverage & capacity, new
features, etc.)?
Answer. State and local public safety users have the ultimate
market-driven tool to ensure their needs are being met: the ability to
walk away and switch to another service available in the market.
FirstNet intends to work directly with State and local public safety
entities to meet their needs of expanded coverage and capacity, feature
and device upgrades, etc. as they arise. FirstNet and its future
partner must listen to and adapt to public safety's evolving
situational awareness and operational needs over the next 25+ years to
be successful.
Additionally, FirstNet recently announced the creation of a Chief
Customer Office (CCO) to prepare for a customer-centric operating
environment with a focus of evolving the organization so it is in the
best position to work with and serve the public safety marketplace. The
CCO includes many of FirstNet's current ``User Advocacy'' programs,
such as Outreach, Consultation, State Plans, and Communications. The
office will also encompass future customer service programs, product
management, marketing, training, and will continue to evolve to meet
FirstNet's public safety customers' needs.
Question 8. Given the difficulty in constructing new sites on
Federal land and the lack of existing carrier coverage in much of this
area, how will FirstNet achieve significant rural coverage in states
with large percentages of Federal land?
Answer. FirstNet appreciates the need for improved connectivity on
Federal land across the country and recognizes the difficulty and
coordination needed in the construction of new sites. FirstNet will
work in close coordination with its Federal, State, Tribal County and
local partners to explore deployment opportunities and public
infrastructure in these areas. While many solutions will be looked at,
in some areas FirstNet may utilize alternative solutions, such as high
power equipment (as allowed by the act) deployables and vehicular
network solutions to assist in remote areas. FirstNet will be working
with States and its RFP awardee to understand the possibilities of
deployable coverage in areas with coverage needs that may not be static
or as easy to build permanent structures.
Question 9. Are there contingency plans in case the partner is
unable to fulfill the obligations required for buildout?
Answer. FirstNet will be fully engaged with our partner to deploy
the NPSBN to ensure a timely and effective deployment throughout the
lifetime of the contract. While we will work intently to avoid any
missteps in the program, there is always the possibility of project
delays or the partner missing buildout targets. This is one of the
primary reasons why FirstNet is consulting with States, setting the
proper expectations on deployment timelines and coverage, we don't want
to over extend our financial position or induce financial risk into the
project.
For such contingencies, the Request for Proposals (RFP) outlines a
system where FirstNet would intervene and assess the degree to which
there may be possible failures to meet deployment targets. Depending on
the severity of the missed targets, the partner will be obligated to
make disincentive payments back to FirstNet. The disincentive payments
are on a sliding scale, and will continue until the program is back on
track. If for whatever reason the partner cannot return back to meeting
targets in a mutually agreed way, then there is an option for FirstNet
to step in and recover the deployment planning.
Question 10. What efforts has FirstNet taken to ensure that its
network incorporates strong cybersecurity measures to protect against
malicious cyberattacks? How does FirstNet intend to maintain an up-to-
date system capable of resisting constantly evolving cyber threats?
Answer. Cybersecurity is one of the sixteen key objectives that
every offeror of the RFP must demonstrate to meet the requirements of
deploying the NPSBN. Included in a cybersecurity solution, an offeror
must provide an end-to-end solution for cybersecurity covering
everything from devices, to connectivity, physical security to network
operations, to applications and other software. The difference with the
NPSBN and other networks is that cybersecurity will be considered from
the very beginning of the network design, instead of in an ad-hoc or
patchwork way. This enables FirstNet and our future partner(s) to
consider how to approach threats like malicious attacks in ways before
the network is designed.
While there will be no perfect solution to cybersecurity, the
benefit of doing this with a private-sector partner is that we can
aggregate the lessons, processes, and responses from multiple agencies,
companies, and other sources, to become smarter, more proactive, and
better informed to protect the FirstNet network. FirstNet intends to
leverage expertise from the public and private sector for the benefit
of public safety. A prime example of how we intend to accomplish this
is our forth public notice on cybersecurity which was released in
October, 2015. The public notice sought solicit input from industry,
public safety, and other interested parties as part of our RFP process
by asking industry to provide some of the key considerations and
concerns with respect to how cyber security should be designed,
established, and sustained as the foundation of the NPSBN.
The contract term is 25 years, and the RFP requires that the
partner show that it has a way to continuously upgrade, maintain, and
secure the network throughout the life of the program. FirstNet is
still evaluating RFP responses at this time and therefore cannot
discuss any specific proposed solutions to the NPSBN. Through the RFP,
however, FirstNet has communicated that it fully expects its future
partner(s) to have solutions to all cyber threats, including malicious
attacks.
______
Response to Written Question Submitted by Hon. Bill Nelson to
Michael Poth
Question. FirstNet has engaged with numerous public sector
stakeholders related to public safety, such as local governments and
law enforcement entities. There are also private sector stakeholders in
the public safety ecosystem, such as alarm service providers, who are
willing to engage with FirstNet on potential use of the network to
assist communication with public safety officials and first responders.
What is the definition of public safety that FirstNet is using? In
addition, how has FirstNet defined the difference between primary and
secondary users of the FirstNet network?
Answer. The Middle Class Tax Relief and Job Creation Act of 2012
(Act) defines a ``public safety entity'' as ``an entity that provides
public safety services.'' 47 U.S.C. Sec. 1401(26). In turn, the Act
defines ``public safety services'' as having ``(A) the meaning given
the term in section 337(f) of the Communications Act of 1934 (47 U.S.C.
337(f)); and (B) includes services provided by emergency response
providers, as that term is defined in section 2 of the Homeland
Security Act of 2002 (6 U.S.C. 101).'' 47 U.S.C. Sec. 1401(27). Thus,
under the Act, the definition includes, at minimum, the traditional
public safety disciplines (law enforcement, fire, and EMS), as well as
any other entities that provide ``public safety services.''
FirstNet issued public notices providing preliminary guidance and
seeking public comment on the ``public safety entity'' definition,
among 63 other key interpretations of the Act that impact operational
and economic issues regarding the planning, deployment, operation, and
sustainability of Nationwide Public Safety Broadband Network (NPSBN).
[See First Responder Network Authority Proposed Interpretations of
Parts of the Middle Class Tax Relief and Job Creation Act of 2012, 79
Fed. Reg. 57058 (September 24, 2014); Further Proposed Interpretations
of Parts of the Middle Class Tax Relief and Job Creation Act of 2012,
80 Fed. Reg. 25663 (May 5, 2015).] The responses helped inform
FirstNet's network planning, including development of our request for
proposals (RFP) for the deployment of the NPSBN.
At this time, FirstNet does not plan to announce any final
interpretation regarding the definition of ``public safety entity'' and
will rely on the plain-language definition provided by Congress in the
Act. However, FirstNet continues to analyze the scope of the
definition, the needs of the public safety community, and the likely
changing nature of those needs over time in determining whether it is
necessary to provide additional guidance.
Pursuant to the Act and FirstNet's Final Interpretations, a
``secondary user'' is any user that seeks access to or use of the NPSBN
for non-public safety services. See 47 U.S.C. Sec. 1428(a); Final
Interpretations of Parts of the Middle Class Tax Relief and Job
Creation Act of 2012, 80 Fed. Reg. 63523 (Oct. 20, 2015). Accordingly,
while the Act does not use that terminology, public safety entities (as
defined by the Act), as a whole, are the ``primary'' users of the
NPSBN.
FirstNet is focusing on developing priority and preemption
capabilities so public safety voice, video, and data communications
will not be in a figurative ``traffic jam'' caused by network
congestion, which is what happens today in areas or events with a high
concentration of users. As part of our work in this area, FirstNet is
coordinating with the Public Safety Advisory Committee (PSAC) and the
states and territories to help develop a Quality of Service, Priority
and Preemption (QPP) framework for the NPSBN. The QPP framework seeks
to ensure that the NPSBN remains a ``wide open freeway'' for public
safety, so when public safety traffic increases, the NPSBN should, as
quickly and seamlessly as possible, move non-public safety traffic onto
other network roadways.
Quality of Service (QoS) is needed to protect access to public
safety mission critical services and applications at the required level
of quality corresponding to their individual needs. QoS requires
assignment of properties such as bandwidth guarantees, usage limits,
latency, accuracy, accessibility, and retention.
Priority is the means by which users, applications, traffic
streams, or individual packets take precedence over others in
establishing a service session or forwarding packets during periods of
congestion in the network. Public safety users will require priority
access to the NPSBN resources to make their communications (at the
required level of QoS) an effective tool in their management of
incidents and emergencies.
Lastly, preemption is used together with priority to control use of
resources by removing lower priority user active sessions and allowing
allocation of resources to higher priority users when network resources
are scarce or fully occupied.
For further information on QPP, FirstNet authored a white paper on
the subject, which is available in the RFP Reading Room. See http://
www.firstnet.gov/resources/request-reading-room-access. This paper has
served as a reference document, explaining FirstNet's vision regarding
QPP, so that potential bidders to FirstNet's RFP were able to develop
proposals around these principles.
______
Response to Written Question Submitted by Hon. Cory Booker to
Michael Poth
Question. New Jersey is using FirstNet spectrum for an exciting
public safety broadband project known as ``JerseyNet.'' This project is
overseen by Fred Scalera, a recognized expert in emergency
communications. The project, which is spread throughout the state and
includes areas in the Route 21 corridor between Camden and Atlantic
City, explores the use of mobile systems to be deployed in case of an
emergency. This project will address a problem that arose during
Superstorm Sandy, when storm damage brought down critical
telecommunications systems.
This project could be a model for the country, greatly contributing
to network functionality in times of crisis. Additionally, because the
units are mobile, they can be deployed to assist other states when
needed. These mobile units were deployed and successfully used during
Pope Francis's visit to Philadelphia last September, and they continue
to be tried and tested at large scale events in the region.
What has FirstNet learned from the JerseyNet project? What role
does FirstNet envision for the use of deployable assets in a future
first responder telecommunications network?
How will you ensure that FirstNet, when deployed, will take
advantage of the latest mobile broadband technologies?
Answer. FirstNet acknowledges the contributions of Mr. Scalera and
the JerseyNet team. JerseyNet and the other early builder projects that
FirstNet supports provide valuable key lessons that have been leveraged
in the creation of the FirstNet Request for Proposal. As documented in
FirstNet's Fiscal Year (FY) 2014 and FY 2015 Annual Reports to
Congress, deployable assets will likely be a key element of the
FirstNet network, and FirstNet continues to leverage the collaborative
work with the State of New Jersey and NTIA to support planning and
implementation of these deployable capabilities. The unique deployable
design elements engineered by the JerseyNet team, such as sizing to
quickly enable parking garage rooftop deployments, and rack mount
assets to provide rooftop deployment flexibility, have been
particularly useful. We expect the future network will leverage the
important lessons gleaned from the JerseyNet project.
Over the past year, substantial progress was made by the JerseyNet
project team, highlighted by successful procurement, design,
engineering, and deployment of multiple classes of deployable assets.
The JerseyNet deployable assets have already successfully deployed to
support many in-state communications initiatives, as well as
neighboring states' response efforts when required. Of special note,
the project successfully supported the September 2015 Papal visit to
Philadelphia using their System on Wheels (SOW) trailers and van and
Sports Utility Vehicle (SUV)-based Vehicular Network Systems (VNS). The
project also successfully supported concerts and other annual events in
Atlantic City, multiple exercises validating the value of public-safety
specific applications and network resources, and, most recently,
support of the PGA Championship in Springfield, NJ.
Public safety agency use of the JerseyNet broadband network
continues to increase. In the remainder of 2016, FirstNet anticipates
that JerseyNet will attract a substantial population of public safety
users and further exercise the Key Learning Conditions (KLCs) defined
in their Spectrum Management Lease Agreement (SMLA) with FirstNet.
These KLCs are:
1. Demonstration and documentation of the use and capabilities of
rapidly deployable assets;
2. Conducting emergency management exercises and training activities
with these deployable assets; and
3. Documenting best practice Network Operations Center (NOC)
notification approaches, including trouble ticketing,
prioritization, reporting, and ticket close-out.
The network as a whole will continue to evolve and grow with
changing technology similar to a traditional commercial network. This
was the vision of Congress, and FirstNet intends to work with its
eventual partner to manage continual advancement of the network,
devices, and services to meet ongoing public safety needs. Because the
Act does not mandate that public safety entities use FirstNet services,
FirstNet and our future partner will have to provide public safety a
value proposition and competitive offerings, featuring the latest
technology, including deployable systems like those in the JerseyNet
system.
______
Response to Written Question Submitted by Hon. Joe Manchin to
Michael Poth
Question. It is my understanding that in addition to FirstNet, any
state that chooses to opt out and build its own radio access network is
also required to reinvest any fees they collect back into the
operation, maintenance, and improvement of the nationwide network.
Although Congress intended to balance the goal of building a nationwide
network with an opportunity for states to build their own, it certainly
did not intend to create an incentive for states to opt out of
FirstNet's network. However, it has been brought to my attention that
there is still some debate about whether higher-density states that
have opted out would be able to divert some fees into state general
funds.
Could the panel clarify if both FirstNet and the states that have
opted out are required to reinvest any fees they collect back into the
network?
Does the panel believe states could divert surplus fees into state
general funds under the authorizing language?
Answer. It is Congress' vision of bringing mission critical
broadband capabilities to public safety in all of the Nation's 56
states and territories that drives FirstNet's work. The task that
Congress has given the organization is vast, not only because it has
never been accomplished before, but also because FirstNet is working
with limited resources. Accordingly, based on the language and intent
of the Act and in consideration of the funding mechanisms available,
FirstNet has interpreted the Act to require that all revenues,
including user/subscriber fees or fees from any public-private
partnership, received by either FirstNet or a state that successfully
assumes responsibility for radio access network deployment must be
reinvested in the network. See Final Interpretations of Parts of the
Middle Class Tax Relief and Job Creation Act of 2012, 80 Fed. Reg.
63504 (Oct. 20, 2015).
More specifically, while not subject to the requirements of the
Administrative Procedure Act (5 U.S.C. Chapter 5), FirstNet conducted
an open, public comment process on this matter to obtain input from
stakeholders leading to final legal interpretations of the Act. See id.
Through this open proceeding and with the support of a majority of
commenters, FirstNet concluded that network revenue gained by an opt-
out state must be reinvested in that state's RAN, and any excess
revenue (beyond what is reasonably necessary to build, operate,
maintain, or upgrade the state's RAN) must be reinvested into the
nationwide network. This conclusion is based on Congress' directive to
ensure the fiscal sustainability, and ultimately the success of the
project, nationwide inclusive of rural areas.
______
Response to Written Questions Submitted by Hon. Gary Peters to
Michael Poth
Question 1. Nearly one-third of Michigan's population lives in non-
urban areas, many of which lack reliable access to broadband. Cities
and towns in these regions, especially in Northern Michigan and the
Upper Peninsula, are popular tourist destinations and can multiply
their populations during the high season. I am concerned that FirstNet,
to date, has focused its planning and coordination efforts in areas
with existing broadband coverage, rather than first working to fill the
gap in areas with no reliable access.
What is FirstNet doing to address these rural gaps and assure that
public safety officials in our Nation's most rural areas will have
access to FirstNet's broadband network?
Answer. To accomplish its mission to ensure the establishment of a
Nationwide Public Safety Broadband Network (NPSBN) that is self-
sustainable, is re-capitalized, and meets rural deployment
requirements, Congress provided FirstNet three fundamental tools: a
one-time allocation of $7 billion generated from spectrum auctions held
by the Federal Communications Commission (FCC), 20 MHz of spectrum in
the 700 MHz band known as Band 14, and the authority to assess fees and
enter into covered leasing agreements (CLAs) to monetize the excess
capacity of Band 14 spectrum.
FirstNet recognizes that rural deployment of the NPSBN is a part of
its mission and that rural coverage will be needed in Michigan's rural
areas and throughout rural America. FirstNet aims to identify and
improve rural coverage gaps for public safety throughout the deployment
of the NPSBN and FirstNet's intended 25-year contract with the RFP
awardee.
As part of its planning efforts, FirstNet has taken a number of
actions to ensure rural deployment of the network, including:
consulting with and collecting data from states and territories
(including Michigan) to identify coverage needs and objectives, setting
rural deployment milestones as an evaluating factor in FirstNet's RFP
to deploy the NPSBN, and incorporating technical solutions to address
coverage in rural areas (e.g., deployable capabilities) as part of the
RFP.
Consultation and Data Collection:
FirstNet has consulted with local, state/territory, tribal, and
Federal public safety entities to ensure that the NPSBN is designed to
meet the needs of public safety across the country. FirstNet has and
will continue to work through the SPOCs to gather feedback from key
stakeholders for reviewing its deployment plan.
FirstNet will deliver a state plan to each governor regarding
FirstNet's plan to deploy the RAN within the state or territory.
Throughout the development of our RFP, FirstNet sought firsthand,
original data from the states to ensure that the information passed
onto the vendor community was state driven with accurate, local
information. The RFP that the vendor community bid on, was built with
the data received to ensure that the states had significant input into
the development of the NPSBN. The State data collection was also made
available in whole to all potential bidders.
FirstNet requested the following information from the states:
1. Coverage: Identify desired coverage within the state or territory
and proposed build out phases.
2. Users and Operational Areas: Gather information on the eligible
user base and their respective operational areas.
3. Capacity Planning: Estimate current data usage today from typical
users with indicators of potential growth.
4. Current Providers/Procurement: Identify current service providers
and plans, procurement vehicles, and barriers to adoption.
5. State Plan Decision Process: Document the final state plan review
process prior to submission to the Governor and any potential
barriers/issues FirstNet should be aware of.
Rural as Evaluating Factor in the RFP:
The Act also requires that FirstNet meet substantial rural
milestones in each phase of NPSBN deployment to ensure that deployment
in rural parts of the country were achieved at a similar speed as urban
deployment. See 47 U.S.C. Sec. 1426(b)(3). In the RFP, offerors were
asked to propose solutions to reach rural milestones using Band 14
spectrum. The proposals should follow these phases, where IOC is the
Initial Operating Capacity, and FOC is the Final Operating Capacity.
RFP Solicitation No. D15PS00295--Section J, Attachment J-8 IOC/FOC
Timeline
------------------------------------------------------------------------
IOC-1
6
Phase months IOC-2 12 IOC-3 24 IOC-4 36 IOC-5 48 FOC 60
from months months months months months
award
------------------------------------------------------------------------
Substant Achieveme Achieveme Achieveme Achieveme Achieveme
ial nt of nt of nt of nt of nt of
Rural 20% of 60% of 80% of 95% of 100% of
Mileston Contract Contract Contract Contract Contract
es or's or's or's or's or's
proposed proposed proposed proposed proposed
Band 14 Band 14 Band 14 Band 14 Band 14
coverage coverage coverage coverage coverage
------------------------------------------------------------------------
FirstNet is in the process of RFP evaluation, and will be
evaluating offerors' proposals on their proposed rural coverage and how
they intend to meet those milestones.
Question 2. Once built, will FirstNet facilitate opportunities for
spectrum sharing with local governments so FirstNet's network can be
leveraged to provide consumer broadband services, on a secondary basis,
for purposes such as business development, education, and telemedicine?
Answer. FirstNet's enabling legislation limits access to network
capacity on a secondary basis for non-public safety services to those
entities that enter into a Covered Leasing Agreement (CLA) with
FirstNet. A CLA results from a ``public-private arrangement'' (i.e.,
not government to government) in which the secondary user agrees to
construct, manage, or operate all or a portion of the nationwide public
safety broadband network and in return is permitted to access network
capacity on a secondary basis for non-public safety services. See 47
U.S.C. Sec. 1428. Consequently, it is not permissible under the Act for
FirstNet to enter into a CLA (i.e., ``spectrum sharing arrangement'')
directly with or provide access to a local government for secondary use
of the spectrum for non-public safety services. Further, to the extent
that a local government entity provides a public safety service that
qualifies it as a public safety entity under the Act, such an entity
would be able to receive services directly from FirstNet.
FirstNet also understands that Michigan has amended state law to
allow for private entities to co-locate at state owned sites. This was
a forward looking action and is applauded by FirstNet. In the future,
FirstNet, along with the private sector entity that is selected through
the procurement process, will continue to look for opportunities that
would allow for the expansion and deployment of the network in a cost-
effective manner that leverage new partnerships that may not exist
today.
Question 3. Companies that provide products and services in areas
such as public safety, defense, and cybersecurity could greatly benefit
from having access to the FirstNet network for research and development
work as a way to address operational and technical challenges in their
fields.
Do you expect that interested companies will be able to work with
FirstNet to test new products and services on the FirstNet network?
Answer. As indicated above, the Act limits the access to and use of
the FirstNet network to (1) public safety entities and (2) secondary
users that enter into a CLA with FirstNet to construct, manage, or
operate all or a portion of the nationwide public safety broadband
network.
With respect to researching and testing products and services, the
Act provided the Public Safety Communications Research (PSCR) program
with $300 million for research and to assist in ``the development of
standards, technologies, and applications to advance wireless public
safety communications,'' including for use on the FirstNet network.
[See 47 U.S.C. Sec. Sec. 1443, 1457.] PSCR has begun an innovative set
of prize competitions to spur innovation and technical research in
these focus areas. For additional information regarding PSCR's schedule
and priority areas for research, please contact PSCR.
Additionally, in the RFP, FirstNet asked offerors to propose
certification and compliance mechanisms for devices, applications, and
services that will run on the network. FirstNet is developing a
laboratory in Boulder, CO that will supplement our partner's proposed
certification processes in order to support the integrity of the
network and build public safety's confidence in FirstNet's devices and
services. For more information on this topic relative to devices, see
the following FirstNet blog: Kameron Behnan, Tech Talk: Intro to
FirstNet's Device Approval Process, (Apr. 4, 2016), available at http:/
/www.firstnet.gov/newsroom/blog/tech-talk-intro-firstnets-device-
approval-process
______
Response to Written Questions Submitted by Hon. Joe Manchin to
Jeffrey S. McLeod
Question 1. It is my understanding that in addition to FirstNet,
any state that chooses to opt out and build its own radio access
network is also required to reinvest any fees they collect back into
the operation, maintenance, and improvement of the nationwide network.
Although Congress intended to balance the goal of building a nationwide
network with an opportunity for states to build their own, it certainly
did not intend to create an incentive for states to opt out of
FirstNet's network. However, it has been brought to my attention that
there is still some debate about whether higher-density states that
have opted out would be able to divert some fees into state general
funds.
Could the panel clarify if both FirstNet and the states that have
opted out are required to reinvest any fees they collect back into the
network?
Answer. NGA does not have sufficient information to offer
substantive answers.
Question 2. Does the panel believe states could divert surplus fees
into state general funds under the authorizing language?
Answer. NGA does not have sufficient information to offer
substantive answers.
______
Response to Written Questions Submitted by Hon. Joe Manchin to
General Arthur J. Logan
Question 1. It is my understanding that in addition to FirstNet,
any state that chooses to opt out and build its own radio access
network is also required to reinvest any fees they collect back into
the operation, maintenance, and improvement of the nationwide network.
Although Congress intended to balance the goal of building a nationwide
network with an opportunity for states to build their own, it certainly
did not intend to create an incentive for states to opt out of
FirstNet's network. However, it has been brought to my attention that
there is still some debate about whether higher-density states that
have opted out would be able to divert some fees into state general
funds.
Could the panel clarify if both FirstNet and the states that have
opted out are required to reinvest any fees they collect back into the
network?
Answer.
FirstNet
Sec.6208 (a-d) authorizes FirstNet to assess and collect fees,
establish fee amounts and receive annual approval from NTIA as to the
fees assessed and that such fees may only be assessed with the approval
of NTIA. Part (d) of the section states: ``Required Reinvestment of the
Funds--The First Responder Network Authority shall reinvest amounts
received from the assessment of fees under this section in the
nationwide public safety broadband network by using such funds only for
constructing, maintaining, operating, or improving the network.''
(emphasis added).
By that language, FirstNet is required to reinvest back into the
network any fees collected.
Opt-Out States:
Section 6302 (f) indicates if a State chooses to build its own
radio access network, the State shall pay any user fees associated with
State use of elements of the core network. Subparagraph (g)
Prohibition, subsection (2) Rule of Construction states: Any revenue
gained by the State from such a leasing agreement shall be used only
for constructing, maintaining, operating, or improving the radio access
network of the State.
The language of this section appears to contemplate that a State
choosing to build its own RAN, upon approval of its alternative plan by
the FCC, must still pay FirstNet for the use of the NPSBN and any
revenue it may gain from a leasing agreement as part of any public-
private partnership derived from its approved alternate plan shall be
used only for constructing, maintaining, operating or improving the
radio access network of the State.
Conclusion: The language in both sections requires that any fees
generated, either by FirstNet or an Opt-Out State, must be reinvested
back into the network.
Question 2. Does the panel believe states could divert surplus fees
into state general funds under the authorizing language?
Answer. The intent of the legislation was to create a Nationwide
Public Safety Broadband Network (NPSBN) to fully support the unique
communications needs of first responders. FirstNet is charged with
taking all actions necessary to ensure the building, deployment, and
operation of the NPSBN. The language of the statute does provide states
the opportunity to ``opt-out'' and build their own RAN if conditions
under the law are met and their alternate plans are approved.
What is consistent is that neither FirstNet nor the States which
may elect to ``opt-out'' may use any fees collected for anything other
than constructing, maintaining, operating or improving the radio access
network.
Nothing in the language of the statute indicates States should be
able to divert surplus fees into their respective state's general fund.
______
Response to Written Questions Submitted by Hon. Kelly Ayotte to
Andrew Katsaros
Question 1. As you highlighted in your testimony, FirstNet has a
coverage challenge with ``the geography of 56 jurisdictions . . . and
the bulk of the population residing in about 5 percent of the U.S. land
mass. The rest of the population resides in rural and wilderness
settings.'' The enormous task of balancing costs and fees in densely
populated areas versus sparsely populated areas is not going unnoticed
in my home state of New Hampshire. Concerns remain that FirstNet's
footprint will remain small and constrained to southern New Hampshire's
more densely populated cities. Do you believe that FirstNet has a
viable path forward to provide sufficient buildout in rural areas that
would enable effective first responder communications?
Answer.
Short Answer
It is OIG's understanding that, as of August 26, 2016, FirstNet
continues to develop, but has not yet finalized, a specific path
forward for the Nationwide Public Safety Broadband Network (NPSBN)
build-out of rural and non-rural areas. FirstNet and its yet-to-be
selected vendor must still propose a viable, sufficient plan that
enables effective first responder communications in rural areas.
Background
As of August 26, 2016, FirstNet has not finalized a specific path
forward for the NPSBN build-out of rural and non-rural areas. The path
forward will become clearer after (1) FirstNet selects a NPSBN build-
out vendor through its Request for Proposals (RFP) process, which is
expected by the end of calendar year 2016; and (2) States decide
whether to opt-in or opt-out of the Radio Access Network (RAN) State
Plans. After these decisions are made, FirstNet and its vendor will be
able to better estimate costs and fees, which will allow it to develop
a specific plan for the build-out and deployment in rural and non-rural
areas.
``By law, FirstNet is responsible for working through the
designated State points of contact to consult with states, local
communities, tribal governments, and first responders to gather
requirements for developing RAN . . . State Plans.'' \1\ Accordingly,
FirstNet has developed a consultation process to discuss and understand
State's rural coverage needs and other priorities. It will be critical
that States communicate their needs during the consultation process and
that FirstNet addresses those needs, especially during the development
of RAN State Plans.
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\1\ National Telecommunications and Information Administration.
``The Process for Working with FirstNet.'' See https://
www.ntia.doc.gov/files/ntia/publications/fact_sheet_process-9-19-13.pdf
(accessed August 31, 2016).
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The Middle Class Tax Relief and Job Creation Act of 2012 (the Act)
states that the nationwide network shall require deployment phases with
substantial rural coverage milestones as part of each phase of the
construction and deployment of the network. To the maximum extent
economically desirable, such proposals shall include partnerships with
existing commercial mobile providers to utilize cost-effective
opportunities to speed deployment in rural areas.\2\
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\2\ See Middle Class Tax Relief and Job Creation Act of 2012 (The
Act), Pub. L. No. 112-96, Sec. 6206(b)(3), 126 Stat. 212.
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Consistent with the Act, FirstNet established substantial rural
milestones in its RFP that require coverage in rural areas in each
phase of the build-out. FirstNet will also evaluate potential vendors
on a variety of factors, including the vendor's capability of providing
rural coverage. For example, FirstNet will evaluate, in part, a
potential vendor's capability of providing coverage and capacity in
each of the 56 States and territories, including rural and non-rural
areas. In addition, FirstNet will evaluate potential vendors ``based on
their demonstration of their existing and planned partnerships with
rural telecommunications providers, including commercial mobile
providers, utilizing existing infrastructure to the maximum extent
economically desirable to speed deployment in rural areas.'' \3\
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\3\ U.S. Department of the Interior, Interior Business Center,
January 13, 2016. FirstNet Nationwide Public Safety Broadband Network
(NPSBN), Solicitation Number: D15PS00295. Herndon, VA: DOI, Sect M, M-
2.
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Question 2. Additionally, how can FirstNet provide cost certainty
and transparent billing to states with concerns that there will be
unforeseen costs--especially that buildout to rural areas may fall on
their shoulders?
Answer.
Short Answer
Although FirstNet has made progress in establishing the NPSBN, OIG
believes it is too early for FirstNet to be able to provide cost
certainty and transparent billing to States and territories.
Background
Public safety entity (PSE) NPSBN user cost is dependent on
FirstNet's upcoming selection of a vendor to partner with on the
design, build, and implementation of the NPSBN. ``In January 2016,
FirstNet issued a RFP for the purpose of seeking a vendor to build and
operate the NPSBN.'' \4\ Included within the RFP is an objective to
``[e]stablish (i) compelling, differentiated, and competitively priced
service packages and (ii) sales, distribution, and marketing
capabilities to ensure adoption of FirstNet products and services by a
majority of eligible PSEs within four years of award.'' \5\ Since PSEs
are not required to subscribe to FirstNet services, the pricing
schedule developed by FirstNet and its contracted vendor will affect
whether PSEs choose to subscribe to FirstNet services. FirstNet plans
to award the contract by the end of calendar year 2016.
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\4\ U.S. Department of Commerce Office of Inspector General, June
21, 2016. Ongoing Activities and Challenges Facing the First Responder
Network Authority in their Establishment of a Nationwide Public Safety
Broadband Network, OIG-16-034-T. Washington, DC: DOC OIG, 2.
\5\ DOI Interior Business Center, January 13, 2016. FirstNet
Nationwide Public Safety Broadband Network (NPSBN), Solicitation
Number: D15PS00295E. Herndon, VA: DOI, Section C.
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Additionally, State decisions regarding whether to opt-in or opt-
out of FirstNet's NPSBN will affect the cost of using FirstNet's core
network. Following the award of the contract, FirstNet is required to
provide States with a plan that describes its approach to provide NPSBN
coverage in the State. To obtain the information necessary to develop
State Plans, FirstNet has consulted with--and requested information
from--States and territories.
Under the Act, Governors will be given the opportunity to review
the FirstNet-provided State Plan to determine if it meets the State's
needs.\6\ If a State decides to opt-in, FirstNet will be responsible
for deploying, operating, and upgrading the RAN in that State,
including getting PSEs to purchase its service. If a State decides that
the plan does not meet its PSE needs and opts-out, the State can then
deploy its own RAN by providing an alternative plan to the Federal
Communications Commission (FCC) and National Telecommunications and
Information Administration (NTIA) for approval and by negotiating a
spectrum lease agreement with FirstNet to tie into the NPSBN core
network. Under this option, the State would determine the build-out to
rural areas, associated prices to PSEs, and related costs.
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\6\ See Middle Class Tax Relief and Job Creation Act of 2012 (The
Act), Pub. L. No. 112-96, Sec. 6302(e)(2), 126 Stat. 219-220.
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FirstNet has acknowledged the challenges of balancing costs and
fees from densely populated areas versus sparsely populated areas. In
considering network funding and revenue reinvestment provisions,
FirstNet noted that
Congress mandated that FirstNet deploy a self-sustaining,
nationwide network, irrespective of if a State opts-in or opts-out.
Given the finite funding sources and Congress' mandate that FirstNet
meet substantial rural milestones, it is critical that FirstNet
leverages the high-density, high-revenue-generating areas of all
States. This nationwide solution achieves expeditious delivery of
dedicated, wireless broadband services to public safety in all areas of
the country.\7\
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\7\ FirstNet. ``FirstNet Network Funding and Revenue Reinvestment
Provisions.'' See http://www.firstnet.gov/sites/default/files/FirstNet-
Network-Funding-Revenue-Reinvestment-Provisions.pdf (accessed August
31, 2016).
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As it must meet the massive costs of deploying the nationwide
network, FirstNet has stated that it has a duty to protect the fees
generated in high-density areas in excess of what is needed to
reasonably maintain the RAN for use in building-out rural coverage
areas.\8\
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\8\ FirstNet, September 2015. ``Use of State and Local
Infrastructure, Rural Coverage, `Early Builders' and Pilots, Frequently
Asked Questions (FAQs).'' Page 2. See http://www.firstnet.gov/sites/
default/files/Use%20of%20local-state-infrastructure%20FAQs_150902.pdf
(accessed August 31, 2016).
Question 3. Lastly, what do you believe are the most important
aspects for states to consider when deciding whether to opt-in or opt-
out of FirstNet's proposal?
Answer.
Short Answer
When deciding whether to opt-in or opt-out of FirstNet's proposal
for an individual State or territory, governors of States and
territories must weigh how well the provided State Plan meets their
public safety needs against the responsibilities (deploying, operating,
and upgrading) and accompanying risks associated with deploying the
State RAN on their own.
Background
Consistent with the Act, FirstNet will provide a State Plan to
governors so they can decide whether FirstNet (opt-in) or the State/
territory (opt-out) takes on the responsibility to deploy, operate, and
maintain the RAN that will interconnect with the nationwide core
network. This decision has serious implications in terms of the
responsibilities and accompanying risks a State will assume, including:
For opt-in entities, no additional action is needed as
FirstNet provides funds to deploy, operate, and upgrade the
network for that State or territory.
For opt-out entities, States and territories are responsible
for funding the network deployment (with potential grant
money), operation, and maintenance. If this option is selected,
States and territories must develop an alternative plan to be
approved by the FCC and obtain NTIA approval that the plan
meets the requirements of the Act (e.g., ongoing
interoperability, cost effectiveness, and comparable security,
coverage, timeliness, and quality of service). States and
territories would then need to negotiate a spectrum capacity
lease with FirstNet.
To facilitate the development of responsive State Plans, FirstNet
has conducted ongoing efforts such as initial consultations, State data
submissions, public notices, and governance body meetings to capture
the needs and wishes of local, State, and tribal public safety
stakeholders. FirstNet will provide State Plan information related to
(1) extent of coverage; (2) services (e.g., plans, pricing, and
security); (3) applications and features; and (4) devices and
accessories to be considered in deciding whether to opt-in or opt-out.
As FirstNet has acknowledged in its June 21, 2016 testimony before this
Committee, the goal of getting to 100 percentage of coverage throughout
the 56 States and territories is aggressive; we believe coverage,
particularly in rural areas, to be a key variable in each State's
decision.
______
Response to Written Questions Submitted by Hon. Joe Manchin to
Andrew Katsaros
Question 1. It is my understanding that in addition to FirstNet,
any state that chooses to opt out and build its own radio access
network is also required to reinvest any fees they collect back into
the operation, maintenance, and improvement of the nationwide network.
Although Congress intended to balance the goal of building a nationwide
network with an opportunity for states to build their own, it certainly
did not intend to create an incentive for states to opt out of
FirstNet's network. However, it has been brought to my attention that
there is still some debate about whether higher-density states that
have opted out would be able to divert some fees into state general
funds.
Could the panel clarify if both FirstNet and the states that have
opted out are required to reinvest any fees they collect back into the
network?
Answer.
Short Answer
Our understanding is that both the First Responder Network
Authority (FirstNet) and the States that opt out are required to
reinvest excess fees back into the network.
Background
The Middle Class Tax Relief and Job Creation Act of 2012 (the Act)
authorizes FirstNet to be a permanent self-funding entity, assessing
and collecting network user fees, lease fees related to network
capacity, and lease fees related to network equipment and
infrastructure.\1\ The Act states that the total amount of fees
assessed for each Fiscal Year shall be sufficient, and not exceed the
amount necessary, to recoup the total expenses of FirstNet in carrying
out its duties and responsibilities.\2\ FirstNet must reinvest amounts
received from the assessment of fees in the Nationwide Public Safety
Broadband Network (NPSBN) by using such funds only for constructing,
maintaining, operating, or improving the network.\3\
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\1\ See Middle Class Tax Relief and Job Creation Act of 2012 (The
Act), Pub. L. No. 112-96, Sec. 6208(a), 126 Stat. 215-16.
\2\ Id. at Sec. 6208(b), 126 Stat. 216.
\3\ Id. at Sec. 6208(d), 126 Stat. 216.
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The Act further requires that those States that wish to opt out of
FirstNet and build their own Radio Access Network (RAN) to submit their
alternative plans for the RAN to the Federal Communications Commission
(FCC). Upon approval of the plan by the FCC, the States are required to
apply to the National Telecommunications and Information Administration
(NTIA) to lease spectrum capacity from FirstNet.\4\ Those States must
demonstrate the cost-effectiveness of their alternative plans, among
other requirements.\5\ FirstNet, as the designated licensee of the
spectrum and an independent authority within NTIA, must ultimately
decide the terms for entering into spectrum capacity leases and whether
to enter into a lease with a State.\6\ Similar to FirstNet
requirements, the Act states that ``[a]ny revenue gained by the State
from such a leasing agreement shall be used only for constructing,
maintaining, operating, or improving the radio access network of the
State.'' \7\
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\4\ Id. at Sec. 6302(e)(3), 126 Stat. 220-21.
\5\ Id. at Sec. 6302(e)(3)(D), 126 Stat. 220-21.
\6\ Final Interpretations of Parts of the Middle Class Tax Relief
and Job Creation Act of 2012, 80 Fed. Reg. 63,504, 63519 (Oct. 20,
2015).
\7\ The Act, Pub. L. No. 112-96 Sec. 6302(g)(2), 126 Stat. 221.
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FirstNet has published its Final Interpretations of Parts of the
Middle Class Tax Relief and Job Creation Act of 2012 in the Federal
Register.\8\ Below, we highlight FirstNet's interpretations that
indicate States will be required to reinvest fees back into the NPSBN.
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\8\ 80 Fed. Reg. 63,504 (Oct. 20, 2015).
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FirstNet explained that it ``has an obligation to ensure the
establishment of a nationwide network and must take into consideration
the interests of all States rather than only a single State.'' \9\
FirstNet then determined that ``as a part of its decision to enter into
a spectrum capacity lease it must take into account the cost-
effectiveness of the proposed alternative State plan, including the
impact of the plan on the nationwide network.'' \10\
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\9\ Id. at 63,520
\10\ Ibid.
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FirstNet concluded that as part of the cost-effective analysis in
determining whether and under what terms to enter into a spectrum
capacity lease, it ``may require that amounts generated within a State
in excess of those required to reasonably sustain the State RAN, be
utilized to support the Act's requirement to deploy the NPSBN on a
nationwide basis.'' \11\ FirstNet also concluded that the Act requires
opt-out States--i.e., ones that assume the responsibilities for RAN
deployment and charge user fees--to reinvest such fees into the
network.\12\ Finally, FirstNet concluded that, as part of its cost-
effectiveness analysis, it must consider State reinvestment and
distribution of any user fees assessed to public safety entities or
spectrum capacity revenues in determining whether and under what terms
to enter into a spectrum capacity lease.\13\
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\11\ Id. at 63,519.
\12\ Id. at 63,506.
\13\ Id. at 63,519.
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FirstNet, in making its final interpretation regarding its
analyzing funding considerations as part of its determination to enter
into a spectrum capacity lease, stated that:
States seeking and receiving approval of alternative RAN plans
could materially affect FirstNet's funding sources and thus its
ability to serve public safety, particularly in rural States.
More precisely, a State that assumes RAN deployment
responsibilities could benefit from, or supplant, these funding
sources by generating and retaining amounts in excess of that
necessary to reasonably maintain the particular State RAN
through monetization of FirstNet's licensed spectrum. By doing
so, the excess value above that reasonably needed to operate
and maintain the RAN would no longer be available to help
ensure that nationwide deployment, particularly in higher cost
rural areas, will occur. This undermines the intent of the Act
and the express requirement for FirstNet to deploy in rural
areas as part of each phase of implementation.\14\
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\14\ Id. at 63,518-19.
Accordingly, FirstNet concludes, based on the language and intent
of the Act that Congress did not intend to permit alternative RAN plans
that inefficiently utilize scarce spectrum resources to hinder the
nationwide deployment of the NPSBN by depriving it of needed financial
support. FirstNet further concludes that it must thus consider the
effect of any such material inefficiencies, among other things, on the
NPSBN in determining whether and what terms to enter into a spectrum
capacity lease.\15\
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\15\ Id. at 63,519.
Question 2. Does the panel believe states could divert surplus fees
into state general funds under the authorizing language?
Answer. Based on our response to the previous question, we do not
believe States are able to divert surplus fees into State general funds
under the authorizing language and FirstNet's interpretations.
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