[Federal Register Volume 70, Number 143 (Wednesday, July 27, 2005)]
[Rules and Regulations]
[Pages 43322-43323]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-14841]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 1

[WT Docket No. 05-211; FCC 05-123]


Implementation of the Commercial Spectrum Enhancement Act

AGENCY: Federal Communications Commission.

ACTION: Declaratory ruling.

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SUMMARY: In order to implement the auction revenue requirement in 
Commercial Spectrum Enhancement Act (CSEA) for any auction of 
frequencies subject to CSEA, the Commission interprets the meaning of 
the term ``total cash proceeds'' as used in CSEA to mean winning bids 
net of any applicable bidding credit discounts.

DATES: Effective August 26, 2005.

ADDRESSES: Federal Communications Commission, 445 Twelfth Street, SW., 
Washington, DC 20554. People with Disabilities: Contact the FCC to 
request materials in accessible formats (Braille, large print, 
electronics files, audio format, etc.) by e-mail at [email protected] or 
call the Consumer & Governmental Affairs Bureau at 202-418-0531 
(voice), 202-418-7365 (TTY).

FOR FURTHER INFORMATION CONTACT: Audrey Bashkin or Gary Michaels, 
Auctions and Spectrum Access Division, Wireless Telecommunications 
Bureau, (202) 418-0660.

SUPPLEMENTARY INFORMATION: This is a synopsis of the Commission's 
Declaratory Ruling in WT Docket No. 05-211 adopted June 9, 2005, and 
released June 14, 2005. The full text of this Commission decision is 
available for inspection and copying during regular business hours at 
the FCC's Reference Information Center, Portals II, 445 Twelfth Street, 
SW., Room CY-A257, Washington, DC 20554. The complete text of this 
decision may also be purchased from the Commission's duplicating 
contractor, Best Copy and Printing, Inc., 445 12th Street, SW., Room 
CY-B402, Washington, DC 20054, telephone 1-800-378-3160 or http://www.BCPIWEB.com. The Declaratory Ruling is also available on the FCC's 
Web site at http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-05-123A1.doc or http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-05-123A1.pdf. The Commission will send a copy of this Declaratory Ruling 
in a report to be sent to Congress and the Government Accountability 
Office pursuant to the Congressional Review Act, see 5 U.S.C. 
801(a)(1)(A).
    1. CSEA establishes a mechanism to use spectrum auction proceeds to 
reimburse Federal agencies operating on ``eligible frequencies'' (the 
216-220 MHz, 1432-1435 MHz, 1710-1755 MHz, and 2385-2390 MHz bands, and 
certain other frequency bands) that may be reallocated from Federal to 
non-Federal use, for the cost of relocating operations. CSEA requires 
that the ``total cash proceeds'' from any auction of eligible 
frequencies equal at least 110 percent of estimated relocation costs of 
eligible Federal entities. CSEA prohibits the Commission from 
concluding any auction of eligible frequencies that falls short of this 
revenue requirement. CSEA requires the Commission, if it is unable to 
conclude an auction for this reason, to cancel the auction, return any 
deposits from participating bidders held in escrow, and absolve such 
bidders from any obligation to bid in any subsequent reauction of the 
spectrum.
    2. In order to implement CSEA's revenue requirement, the Commission 
must determine the meaning of the term ``total cash proceeds'' as used 
in the statute. For the following reasons, the Commission interprets 
``total cash proceeds'' for purposes of CSEA to mean winning bids net 
of any applicable bidding credit discounts. Under the Commission's 
competitive bidding rules, winning bids in an auction do not 
necessarily translate into amounts actually owed by bidders. The 
discrepancy between gross and net winning bid amounts arises from the 
award of bidding credits--i.e., discounts on gross winning bids--to 
eligible designated entities, new entrants into the broadcast 
marketplace, and winning bidders that undertake to serve previously 
underserved tribal lands. In this context, the plain language of the 
statute appears to refer to an auction's net winning bids rather than 
gross

[[Page 43323]]

winning bids. The word ``cash'' is defined as ``money or its 
equivalent;'' or ``ready money'' and ``proceeds'' is defined as ``the 
money obtained from a commercial or fund-raising venture: yield.''
    3. In addition to the language of the statute, the purpose 
underlying the revenue requirement of CSEA supports a determination 
that ``total cash proceeds'' is based on winning bids net of bidding 
credits. Given that Congress's purpose was to provide a mechanism for 
making sufficient funds available to relocating Federal agencies, it is 
reasonable to assume that Congress did not intend the Commission, in 
determining whether the ``total cash proceeds'' requirement has been 
met, to count those portions of winning bids for which the bidder would 
receive credit and not have to pay. Accordingly, the Commission does 
not read CSEA to equate the amount of the gross winning bids with the 
total cash proceeds of the auction.

Federal Communications Commission.
Marlene H. Dortch,
Secretary.
[FR Doc. 05-14841 Filed 7-26-05; 8:45 am]
BILLING CODE 6712-01-P