[Congressional Record Volume 143, Number 63 (Wednesday, May 14, 1997)]
[Senate]
[Pages S4485-S4487]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. BREAUX:
  S. 741. A bill to amend the Communications Act of 1934 to enable the 
Federal Communications Commission to enhance its spectrum management 
program capabilities through the collection of lease fees for new 
spectrum for radio services that are statutorily excluded from 
competitive bidding, and to enhance law enforcement and public safety 
radio communications; to the Committee on Commerce, Science, and 
Transportation.


             THE PRIVATE WIRELESS SPECTRUM AVAILABILITY ACT

 Mr. BREAUX. Mr. President, I introduce the Private Wireless 
Spectrum Availability Act of 1997. This legislation will help the more 
than 300,000 U.S. companies, both large and small, that have invested 
$25 billion in internally owned and operated wireless communications 
systems. It will provide these companies with critically needed 
spectrum and will do so through an equitable lease fee system.
  The private wireless communications community includes industrial, 
land transportation, business, educational, and philanthropic 
organizations that own and operate communications systems for their 
internal use. The top 10 U.S. industrial companies have more than 6,000 
private wireless licenses. Private wireless systems also serve 
America's small businesses in the utility, contracting, taxi, and 
livery industries.
  These internal-use communications facilities greatly enhance public 
safety and the quality of American life. They also support global 
competitiveness for American firms. For example, private wireless 
systems support: the efficient production of goods and services; the 
safe transportation of passengers and products by land and air; the 
exploration, production, and distribution of energy; agricultural 
enhancement and production; the maintenance and development of 
America's infrastructure;

[[Page S4486]]

and compliance with various local, State, and Federal operational 
government statutes.
  Current regulatory policy inadequately recognizes the public interest 
benefits that private wireless licensees provide to the American 
public. Consequently, allocations of spectrum to these private wireless 
users has been deficient. Private wireless entities received spectrum 
in 1974 and 1986 when the FCC allocated channels in the 800 megahertz 
and 900 megahertz bands. Over time, however, the FCC has significantly 
reduced the number of channels available to industrial and business 
entities in those allocations. Private wireless entities now have 
access to only 299 channels, or 32 percent of the channels of the 
original allocation.
  Spectrum auctions have done a great job of speeding up the licensing 
of interpersonal communications services and have generated significant 
revenues for the U.S. Treasury. They have also unfortunately skewed the 
spectrum allocation process toward subscriber-based services and away 
from critical radio services such as private wireless which are 
exempted from auctions. Nearly 200 megahertz of spectrum has been 
allocated for the provision of commercial telecommunications services, 
virtually all of which has been assigned by the FCC through competitive 
bidding.

  Competitive bidding is not the proper assignment methodology for 
private wireless telecommunications users. Private wireless operations 
are site-specific systems which vary in size based on that user's 
particular needs, and are seldom mutually exclusive from other private 
wireless applicants. Auctions, which depend on mutually exclusive 
applications and use market areas based on population, simply cannot be 
designed for private wireless systems.
  This legislation mandates that the FCC allocate no less than 12 
megahertz of new spectrum for private wireless use as a measure to 
maintain our industrial and business competitiveness in the global 
arena, as well as to protect the welfare of the employees in the 
American workplace. Research indicates that private wireless companies 
are willing to pay a reasonable fee in return for use of spectrum. They 
recognize that their access to spectrum increases with their 
willingness to pay fair value for the use of this national asset.
  My bill grants the FCC legislative authority to charge efficiency-
based spectrum lease fees in this new spectrum allocation. These lease 
fees should encourage the efficient use of spectrum by the private 
wireless industry, generate recurring annual revenues as compensation 
for the use of spectrum, and retain spectrum ownership by the public. 
Furthermore, the fees should be easy for private frequency advisory 
committees to calculate and collect.
  Mr. President, I am mindful that some peripheral concerns expressed 
by small businesses that service private wireless users are not 
addressed in this bill. I assure these companies that I will work with 
them through the legislative process to address these issues. I urge my 
colleagues to join me in supporting this bill and ask unanimous consent 
that the full text of the bill be printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 741

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Private Wireless Spectrum 
     Availability Act''.

     SEC. 2. DEFINITIONS.

       As used in this Act--
       (1) Commission.--The term ``Commission'' means the Federal 
     Communications Commission.
       (2) Public safety.--The term ``public safety'' means fire, 
     police, or emergency medical service including critical care 
     medical telemetry, and such other services related to public 
     safety as the Commission may include within the definition of 
     public safety for purposes of this Act.
       (3) Private wireless.--The term ``private wireless'' 
     encompasses all land mobile telecommunications systems 
     operated by or through industrial, business, transportation, 
     educational, philanthropic or ecclesiastical organizations 
     where these systems, the operation of which may be shared, 
     are for the licensees' internal use, rather than subscriber-
     based Commercial Mobile Radio Services (CMRS) systems.
       (4) Spectrum lease fee.--The term ``spectrum lease fee'' 
     means a periodic payment for the use of a given amount of 
     electromagnetic spectrum in a given area in consideration of 
     which the user is granted a license for such use.

     SEC. 3. FINDINGS.

       The Congress finds that:
       (1) Private wireless communications systems enhance the 
     competitiveness of American industry and business in 
     international commerce, promote the development of national 
     infrastructure, improve the delivery of products and services 
     to consumers in the United States and abroad, and contribute 
     to the economic and social welfare of citizens of the United 
     States.
       (2) The highly specialized telecommunications requirements 
     of licensees in the private wireless services would be 
     served, and a more favorable climate would be created for the 
     allocation of additional electromagnetic spectrum for those 
     services if an alternative license administration 
     methodology, in addition to the existing competitive bidding 
     process, were made available to the Commission.

     SEC. 4. SPECTRUM LEASING FEES.

       Title I of the Communications Act of 1934 (47 U.S.C. 151 et 
     seq.) is amended by adding at the end thereof the following:

     ``SEC. 12. SPECTRUM LEASE FEE PROGRAM.

       ``(a) Spectrum Lease Fees.--
       ``(1) In general.--Within 6 months after the date of 
     enactment of the Private Wireless Spectrum Availability Act, 
     the Commission shall by rule--
       ``(A) implement a system of spectrum lease fees applicable 
     to newly allocated frequency bands, as described in section 5 
     of the Private Wireless Spectrum Availability Act, assigned 
     to systems (other than public safety systems (as defined in 
     section 2(2) of the Private Wireless Spectrum Availability 
     Act)) in private wireless service;
       ``(B) provide appropriate incentives for licensees to 
     confine their radio communication to the area of operation 
     actually required for that communications; and
       ``(C) permit private land mobile frequency advisory 
     committees certified by the Commission to assist in the 
     computation, assessment, collection, and processing of 
     amounts received under the system of spectrum lease fees.
       ``(2) Formula.--The Commission shall include as a part of 
     the rulemaking carried out under paragraph (1)--
       ``(A) a formula to be used by private wireless licensees 
     and certified frequency advisory committees to compute 
     spectrum lease fees; and
       ``(B) an explanation of the technical factors included in 
     the spectrum lease fee formula, including the relative weight 
     given to each factor.
       ``(b) Fee Basis.--
       ``(1) Initial fees.--Fees assessed under the spectrum lease 
     fee system established under subsection (a) shall be based on 
     the approximate value of the assigned frequencies to the 
     licensees. In assessing the value of the assigned frequencies 
     to licensees under this subsection, the Commission shall take 
     into account all relevant factors, including the amount of 
     assigned bandwidth, the coverage area of a system, the 
     geographic location of the system, and the degree of 
     frequency sharing with other licensees in the same area. 
     These factors shall be incorporated in the formula described 
     in subsection (a)(2).
       ``(2) Adjustment of fees.--The Commission may adjust the 
     formula developed under subsection (a)(2) whenever it 
     determines that adjustment is necessary in order to calculate 
     the lease fees more accurately or fairly.
       ``(3) Fee cap.--The spectrum lease fees shall be set so 
     that, over a 10-year license term, the amount of revenues 
     generated will not exceed the revenues generated from the 
     auction of comparable spectrum. For purposes of this 
     paragraph, the `comparable spectrum' shall mean spectrum 
     located within 500 megahertz of that spectrum licensed in a 
     concluded auction for mobile radio communication licenses.
       ``(c) Application to Private Wireless Systems.--After the 
     Commission has implemented the spectrum leasing fee system 
     under subsection (a) and provided licensees access to new 
     spectrum as defined in section 5(c)(2) of the Private 
     Wireless Spectrum Availability Act, it shall assess the fees 
     established for that system against all licensees authorized 
     in any new frequency bands allocated for private wireless 
     use.''.

     SEC. 5. SPECTRUM LEASE FEE PROGRAM INITIATION.

       (a) In General.--The Commission shall allocate for use in 
     the spectrum lease fee program under section 12 of the 
     Communications Act of 1934 (47 U.S.C. 162) not less than 12 
     megahertz of electromagnetic spectrum, previously unallocated 
     to private wireless, located between 150 megahertz and 1000 
     megahertz on a nationwide basis.
       (b) Existing Incumbents.--In allocating electromagnetic 
     spectrum under subsection (a), the Commission shall ensure 
     that existing incumbencies do not inhibit effective access to 
     use of newly allocated spectrum to the detriment of the 
     spectrum lease fee program.
       (c) Timeframe.--
       (1) Allocation.--The Commission shall allocate 
     electromagnetic spectrum under subsection (a) within 6 months 
     after the date of enactment of this Act.
       (2) Access.--The Commission shall take such reasonable 
     action as may be necessary to ensure that initial access to 
     electromagnetic spectrum allocated under subsection (a) 
     commences not later than 12

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     months after the date of enactment of this Act.

     SEC. 6. DELEGATION OF AUTHORITY.

       Section 5 of the Communications Act of 1934 (47 U.S.C. 155) 
     is amended by adding at the end thereof the following:
       ``(f) Delegation to Certified Frequency Advisory 
     Committees.--
       ``(1) In general.--The Commission may, by published rule or 
     order, utilize the services of certified private land mobile 
     frequency advisory committees to assist in the computation, 
     assessment, collection, and processing of funds generated 
     through the spectrum lease fee program under section 12 of 
     this Act. Except as provided in paragraph (3), a decision or 
     order made or taken pursuant to such delegation shall have 
     the same force and effect, and shall be made, evidenced, and 
     enforced in the same manner, as decisions or orders of the 
     Commission.
       ``(2) Processing and depositing of fees.--A frequency 
     advisory committee shall deposit any spectrum lease fees 
     collected by it under Commission authority with a banking 
     agent designated by the Commission in the same manner as it 
     deposits application filing fees collected under section 8 of 
     this Act.
       ``(3) Review of actions.--A decision or order under 
     paragraph (1) is subject to review in the same manner, and to 
     the same extent, as decisions or orders under subsection 
     (c)(1) are subject to review under paragraphs (4) through (7) 
     of subsection (c).

     SEC. 7. PROHIBITION OF USE OF COMPETITIVE BIDDING.

       Section 309(j)(6) of the Communications Act of 1934 (47 
     U.S.C. 309(j)(6)) is amended--
       (1) by striking ``or'' at the end of subparagraph (G);
       (2) by striking the period at the end of subparagraph (H) 
     and inserting a semicolon and ``or''; and
       (3) by adding at the end thereof the following:
       ``(I) preclude the Commission from considering the public 
     interest benefits of private wireless communications systems 
     (as defined in section 2(3) of the Spectrum Efficiency Reform 
     Act of 1977) and making allocations in circumstances in 
     which--
       ``(i) the pre-defined geographic market areas required for 
     competitive bidding processes are incompatible with the needs 
     of radio services for site-specific system deployment;
       ``(ii) the unique operating characteristics and 
     requirements of Federal agency spectrum users demand, as a 
     prerequisite for sharing of Federal spectrum, that 
     nongovernment access to the spectrum be restricted to radio 
     systems that are non subscriber-based;
       ``(iii) licensee concern for operational safety, security, 
     and productivity are of paramount importance and, as a 
     consequence, there is no incentive, interest, or intent to 
     use the assigned frequency for producing subscriber-based 
     revenue; or
       ``(iv) the Commission, in its discretion, deems competitive 
     bidding processes to be incompatible with the public 
     interest, convenience, and necessity.''.

     SEC. 8. USE OF PROCEEDS FROM SPECTRUM LEASE FEES.

       (a) Establishment of Account.--There is hereby established 
     on the books of the Treasury an account for the spectrum 
     license fees generated by the spectrum license fee system 
     established under section 12 of the Communications Act of 
     1934 (47 U.S.C. 162). Except as provided in subsections (b) 
     and (c), all proceeds from spectrum lease fees shall be 
     deposited in the Treasury in accordance with chapter 33 of 
     title 31, United States Code, and credited to the account 
     established by this subsection.
       (b) Administrative Expenses.--Out of amounts received from 
     spectrum lease payments a fair and reasonable amount, as 
     determined by the Commission, may be retained by a certified 
     frequency advisory committee acting under section 5(f) of the 
     Communications Act of 1934 (47 U.S.C. 155(f)) to cover costs 
     incurred by it in administering the spectrum lease fee 
     program.

     SEC. 9. LEASING NOT TO AFFECT COMMISSION'S DUTY TO ALLOCATE.

       The implementation of spectrum lease fees as a license 
     administration mechanism is not a substitute for effective 
     spectrum allocation procedures. The Commission shall continue 
     to allocate spectrum to various services on the basis of 
     fulfilling the needs of these services, and shall not use 
     fees or auctions as an allocation mechanism.
                                 ______