[Federal Register Volume 80, Number 93 (Thursday, May 14, 2015)]
[Rules and Regulations]
[Pages 27572-27587]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-11653]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Parts 1 and 73

[AU Docket No. 15-3; DA 15-452]


Auction of FM Broadcast Construction Permits Scheduled for July 
23, 2015; Notice and Filing Requirements, Minimum Opening Bids, Upfront 
Payments, and Other Procedures for Auction 98

AGENCY: Federal Communications Commission.

ACTION: Final rule; requirements and procedures.

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SUMMARY: This document announces the procedures, upfront payment 
amounts, and minimum opening bids for the upcoming auction of certain 
FM broadcast construction permits. This document is intended to 
familiarize prospective applicants with the procedures and other 
requirements for participation in Auction 98, as well as provide an 
overview of the post-auction application and payment processes.

DATES: Applications to participate in Auction 98 must be filed prior to 
6:00 p.m. Eastern Time (ET) on May 28, 2015. Bidding in Auction 98 is 
scheduled to begin on July 23, 2015.

FOR FURTHER INFORMATION CONTACT:  Wireless Telecommunications Bureau, 
Auctions and Spectrum Access Division: For legal and general auction 
questions: Lynne Milne or Howard Davenport at (202) 418-0660; For 
auction process and procedures: Jeff Crooks or Sue Sterner at (202) 
418-0660. Media Bureau, Audio Division: For licensing information, 
service rule and other questions: Lisa Scanlan or Tom Nessinger at 
(202) 418-2700. To request materials in accessible formats (Braille, 
large print, electronic files, or audio format) for people with 
disabilities, send an email to [email protected] or call the Consumer and 
Governmental Affairs Bureau at (202) 418-0530 or (202) 418-0432 (TTY).

[[Page 27573]]


SUPPLEMENTARY INFORMATION: This is a summary of the Auction 98 
Procedures Announcement released on April 22, 2015. The complete texts 
of the Auction 98 Procedures Announcement, including its attachment and 
related Commission documents, are available for public inspection and 
copying from the FCC Reference Information Center, 445 12th Street SW., 
Room CY-A257, Washington, DC 20554 during the regular business hours of 
the FCC Reference Information Center. The Auction 98 Procedures 
Announcement and related documents also are available on the Internet 
at the Commission's Web site: http://wireless.fcc.gov/auctions/98/ auctions/98/, or 
by using the search function for AU Docket No. 15-3 on the Commission's 
Electronic Comment Filing System (ECFS) Web page at http://www.fcc.gov/cgb/ecfs/.

I. General Information

A. Introduction

    1. On March 16, 2015, the Wireless Telecommunications Bureau and 
the Media Bureau (collectively, the Bureaus) released a public notice 
seeking comment on specific competitive bidding procedures to be used 
in Auction 98. The Bureaus received comments from four individuals in 
response to the Auction 98 Request for Comment, 80 FR 15715, March 25, 
2015.
i. Construction Permits in Auction 98
    2. Auction 98 will offer 131 construction permits in the FM 
broadcast service, as listed in Attachment A of the Auction 98 
Procedures Announcement. These construction permits are for vacant FM 
allotments, and are designated for use in the indicated communities.
    3. Applicants may apply for any vacant FM allotment listed in 
Attachment A to the Auction 98 Procedures Announcement. When two or 
more short-form applications (FCC Form 175) are submitted specifying 
the same FM allotment in Auction 98, mutual exclusivity exists for 
auction purposes and that construction permit must be awarded by 
competitive bidding procedures. Once mutual exclusivity exists for 
auction purposes, even if only one applicant is qualified to bid for a 
particular construction permit, that applicant is required to submit a 
bid in order to obtain the construction permit. Any applicant that 
submits a short-form application but fails to become a qualified bidder 
for any reason, including a failure to timely submit an upfront 
payment, will retain its status as an Auction 98 applicant and will 
remain subject to the Commission's rules prohibiting certain 
communications, 47 CFR 1.2105(c) and 73.5002(d).
    4. Attachment A of the Auction 98 Procedures Announcement lists the 
reference coordinates for each vacant FM allotment offered in this 
auction. An applicant for FM stations has the option to submit a set of 
coordinates as an alternative to the reference coordinates for the 
vacant FM allotment upon which they intend to bid.

B. Rules and Disclaimers

i. Relevant Authority
    5. Prospective applicants must familiarize themselves thoroughly 
with the Commission's general competitive bidding rules, including 
recent amendments and clarifications, as well as Commission decisions 
in proceedings regarding competitive bidding procedures, application 
requirements, and obligations of Commission licensees. Broadcasters 
should also familiarize themselves with the Commission's FM broadcast 
service rules contained in 47 CFR 73.201-73.333 and 73.1001-73.5009. 
Prospective bidders must also be familiar with the broadcast auction 
and competitive bidding rules contained in 47 CFR 1.2101-1.2112 and 
73.5000-73.5009. All bidders must also be thoroughly familiar with the 
procedures, terms and conditions contained in the Auction 98 Procedures 
Announcement and the public notices and orders referenced in it.
    6. The terms contained in the Commission's rules, relevant orders, 
and public notices are not negotiable. The Commission may amend or 
supplement the information contained in its public notices at any time, 
and will issue public notices to convey any new or supplemental 
information to applicants. It is the responsibility of all applicants 
to remain current with all Commission rules and with all public notices 
pertaining to this auction. Copies of most auction-related Commission 
documents, including public notices, can be retrieved from the FCC 
Auctions Internet site at http://wireless.fcc.gov/auctions.
ii. Prohibited Communications and Compliance With Antitrust Laws
    7. 47 CFR 1.2105(c) prohibits auction applicants for construction 
permits in any of the same geographic license areas from communicating 
with each other about bids, bidding strategies, or settlements unless 
such applicants have identified each other on their short-form 
applications (FCC Form 175) as parties with whom they have entered into 
agreements pursuant to 47 CFR 1.2105(a)(2)(viii).
a. Entities Subject to 47 CFR 1.2105
    8. The prohibition on certain communications specified in 47 CFR 
1.2105(c) will apply to any applicant that submits a short-form 
application seeking to participate in a Commission auction for 
construction permits in the same geographic license area. Thus, unless 
they have identified each other on their short-form applications as 
parties with whom they have entered into agreements under 47 CFR 
1.2105(a)(2)(viii), applicants for any of the same geographic license 
areas must affirmatively avoid all communications with or disclosures 
to each other that affect or have the potential to affect bids or 
bidding strategy. In some instances, this prohibition extends to 
communications regarding the post-auction market structure. This 
prohibition applies to all applicants regardless of whether such 
applicants become qualified bidders or actually bid. For the FM 
service, the geographic license area is the market designation, which 
is the particular vacant FM allotment (e.g., Hermitage, Arkansas, 
Channel 300A, MM-FM979-A). In Auction 98, this rule would apply to 
applicants designating any of the same FM allotments on the short-form 
application.
    9. For purposes of this prohibition on certain communications, 47 
CFR 1.2105(c)(7)(i) defines applicant as including all officers and 
directors of the entity submitting a short-form application to 
participate in the auction, all controlling interests of that entity, 
as well as all holders of partnership and other ownership interests and 
any stock interest amounting to 10 percent or more of the entity, or 
outstanding stock, or outstanding voting stock of the entity submitting 
a short-form application. For example, where an individual served as an 
officer for two or more applicants, the Bureaus have found that the 
bids and bidding strategies of one applicant are conveyed to the other 
applicant, and, absent a disclosed bidding agreement, an apparent 
violation of 47 CFR 1.2105(c) occurs. Individuals and entities subject 
to 47 CFR 1.2105(c) should take special care in circumstances where 
their employees may receive information directly or indirectly relating 
to any competing applicant's bids or bidding strategies.
    10. 47 CFR 1.2105(c)(4) allows a non-controlling interest holder to 
obtain an interest in more than one competing applicant without 
violating 47 CFR 1.2105(c) provided specified conditions

[[Page 27574]]

are met (including a certification that no prohibited communications 
have occurred or will occur), but that exception does not extend to a 
controlling interest holder.
    11. Auction 98 applicants are encouraged not to use the same 
individual as an authorized bidder. A violation of 47 CFR 1.2105(c) 
could occur if an individual acts as the authorized bidder for two or 
more competing applicants, and conveys information concerning the 
substance of bids or bidding strategies between such applicants. 
Similarly, if the authorized bidders are different individuals employed 
by the same organization (e.g., law firm, engineering firm or 
consulting firm), a violation could occur. In such a case, at a 
minimum, applicants should certify on their applications that 
precautionary steps have been taken to prevent communication between 
authorized bidders, and that the applicant and its bidders will comply 
with 47 CFR 1.2105(c).
b. Prohibition Applies Until Down Payment Deadline
    12. 47 CFR 1.2105(c)'s prohibition on certain communications begins 
at the short-form application filing deadline and ends at the down 
payment deadline after the auction closes, which will be announced in a 
future public notice.
c. Prohibited Communications
    13. Applicants must not communicate directly or indirectly about 
bids or bidding strategy to other applicants in this auction. 47 CFR 
1.2105(c) prohibits not only communication about an applicant's own 
bids or bidding strategy, it also prohibits communication of another 
applicant's bids or bidding strategy. While 47 CFR 1.2105(c) does not 
prohibit non-auction-related business negotiations among auction 
applicants, each applicant must remain vigilant so as not to directly 
or indirectly communicate information that affects, or could affect, 
bids, bidding strategy, or the negotiation of settlement agreements.
    14. Applicants are cautioned that the Commission remains vigilant 
about prohibited communications taking place in other situations, 
including capital calls or requests for additional funds in support of 
bids or bidding strategies. An applicant also may not use the 
Commission's bidding system to disclose its bidding strategy. 
Applicants also should use caution in their dealings with other 
parties, such as members of the press, financial analysts, or others 
who might become conduits for the communication of prohibited bidding 
information. For example, an applicant's statement to the press that it 
intends to stop bidding in the auction could give rise to a finding of 
a 47 CFR 1.2105(c) violation. Similarly, an applicant's public 
statement of intent not to participate in Auction 98 bidding could also 
violate the rule. Applicants are hereby placed on notice that public 
disclosure of information relating to bids, or bidding strategies, or 
to post auction market structures may violate 47 CFR 1.2105(c).
d. Disclosure of Bidding Agreements and Arrangements
    15. The Commission's rules do not prohibit applicants from entering 
into otherwise lawful bidding agreements before filing their short-form 
applications, as long as they disclose the existence of the 
agreement(s) in their short-form applications. Applicants must identify 
in their short-form applications all parties with whom they have 
entered into any agreements, arrangements, or understandings of any 
kind relating to the construction permits being auctioned, including 
any agreements relating to post-auction market structure.
    16. If parties agree in principle on all material terms prior to 
the short-form application filing deadline, each party to the agreement 
must identify the other party or parties to the agreement on its short-
form application under 47 CFR 1.2105(c), even if the agreement has not 
been reduced to writing. If the parties have not agreed in principle by 
the short-form filing deadline, they should not include the names of 
parties to discussions on their applications, and they may not continue 
negotiation, discussion or communication with any other applicants 
after the short-form application filing deadline.
    17. 47 CFR 1.2105(c) does not prohibit non-auction-related business 
negotiations among auction applicants. However, certain discussions or 
exchanges could touch upon impermissible subject matters because they 
may convey pricing information and bidding strategies. Such subject 
areas include, but are not limited to, issues such as management, 
sales, local marketing agreements, rebroadcast agreements, and other 
transactional agreements.
e. 47 CFR 1.2105(c) Certification
    18. By electronically submitting a short-form application, each 
applicant in Auction 98 certifies its compliance with 47 CFR 1.2105(c) 
and 73.5002. In particular, an applicant must certify under penalty of 
perjury it has not entered and will not enter into any explicit or 
implicit agreements, arrangements or understandings of any kind with 
any parties, other than those identified in the application, regarding 
the amount of the applicant's bids, bidding strategies, or the 
particular construction permits on which it will or will not bid. 
However, the Bureaus caution that merely filing a certifying statement 
as part of an application will not outweigh specific evidence that a 
prohibited communication has occurred, nor will it preclude the 
initiation of an investigation when warranted. Any applicant found to 
have violated 47 CFR 1.2105(c) may be subject to sanctions.
f. Duty To Report Prohibited Communications
    19. 47 CFR 1.2105(c)(6) provides that any applicant that makes or 
receives a communication that appears to violate 47 CFR 1.2105(c) must 
report such communication in writing to the Commission immediately, and 
in no case later than five business days after the communication 
occurs. The Commission has clarified that each applicant's obligation 
to report any such communication continues beyond the five-day period 
after the communication is made, even if the report is not made within 
the five-day period.
    20. In addition, 47 CFR 1.65 requires an applicant to report to the 
Commission any communication the applicant has made to or received from 
another applicant after the short-form application filing deadline that 
affects or has the potential to affect bids or bidding strategy, unless 
such communication is made to or received from a party to an agreement 
identified under 47 CFR 1.2105(a)(2)(viii). 47 CFR 1.65(a) and 
1.2105(c) require each applicant in competitive bidding proceedings to 
furnish additional or corrected information within five business days 
of a significant occurrence, or to amend its short-form application no 
more than five business days after the applicant becomes aware of the 
need for amendment.
g. Procedure for Reporting Prohibited Communications
    21. A party reporting any communication pursuant to 47 CFR 1.65, 
1.2105(a)(2), or 1.2105(c)(6) must take care to ensure that any report 
of a prohibited communication does not itself give rise to a violation 
of 47 CFR 1.2105(c). For example, a party's report of a prohibited 
communication could violate the rule by communicating prohibited 
information to other applicants through the use of Commission filing 
procedures that

[[Page 27575]]

would allow such materials to be made available for public inspection.
    22. 47 CFR 1.2105(c) requires a party to file only a single report 
concerning a prohibited communication and to file that report with the 
Chief of the Auctions and Spectrum Access Division, Wireless 
Telecommunications Bureau, by the most expeditious means available. Any 
such report should be submitted by email to Margaret W. Wiener at the 
following email address: [email protected]. If a party chooses instead 
to submit a report in hard copy, any such report must be delivered only 
to: Margaret W. Wiener, Chief, Auctions and Spectrum Access Division, 
Wireless Telecommunications Bureau, Federal Communications Commission, 
445 12th Street SW., Room 6423, Washington, DC 20554.
    23. A party seeking to report such a prohibited communication 
should consider submitting its report with a request that the report or 
portions of the submission be withheld from public inspection by 
following the procedures specified in 47 CFR 0.459. Such parties also 
are encouraged to coordinate with the Auctions and Spectrum Access 
Division staff about the procedures for submitting such reports.
h. Winning Bidders Must Disclose Terms of Agreements
    24. Each applicant that is a winning bidder will be required to 
disclose in its long-form application the specific terms, conditions, 
and parties involved in any agreement it has entered into. This 
requirement applies to any bidding consortia, joint venture, 
partnership, or agreement, understanding, or other arrangement entered 
into relating to the competitive bidding process, including any 
agreement relating to the post-auction market structure. Failure to 
comply with the Commission's rules can result in enforcement action.
i. Additional Information Concerning Rule Prohibiting Certain 
Communications
    25. A summary listing of documents issued by the Commission and the 
Bureaus addressing the application of 47 CFR 1.2105(c) may be found in 
Attachment E of the Auction 98 Procedures Announcement. These documents 
are available on the Commission's auction Web page at http://wireless.fcc.gov/auctions/prohibited_communications.
j. Antitrust Laws
    26. Regardless of compliance with the Commission's rules, 
applicants remain subject to the antitrust laws, which are designed to 
prevent anticompetitive behavior in the marketplace. Compliance with 
the disclosure requirements of 47 CFR 1.2105(c) will not insulate a 
party from enforcement of the antitrust laws.
    27. To the extent the Commission becomes aware of specific 
allegations that suggest that violations of the federal antitrust laws 
may have occurred, the Commission may refer such allegations to the 
United States Department of Justice for investigation. If an applicant 
is found to have violated the antitrust laws or the Commission's rules 
in connection with its participation in the competitive bidding 
process, it may be subject to forfeiture of its upfront payment, down 
payment, or full bid amount and may be prohibited from participating in 
future auctions, among other sanctions.
iii. Due Diligence
    28. Each potential bidder is solely responsible for investigating 
and evaluating all technical and marketplace factors that may have a 
bearing on the value of the construction permits for broadcast 
facilities it is seeking in this auction. Each bidder is responsible 
for assuring that, if it wins a construction permit, it will be able to 
build and operate facilities in accordance with the Commission's rules. 
The FCC makes no representations or warranties about the use of this 
spectrum for particular services. Applicants should be aware that an 
FCC auction represents an opportunity to become an FCC permittee in a 
broadcast service, subject to certain conditions and regulations. These 
conditions include, but are not limited to, the condition that FCC 
licenses and other authorizations (whether awarded through competitive 
bidding or otherwise) are subject to the authority of the FCC, under 
the Communications Act of 1934, as amended, to modification through 
rulemaking and adjudicative proceedings. An FCC auction does not 
constitute an endorsement by the FCC of any particular service, 
technology, or product, nor does an FCC construction permit or license 
constitute a guarantee of business success.
    29. An applicant should perform its due diligence research and 
analysis before proceeding, as it would with any new business venture. 
Each potential bidder to review all underlying Commission orders, such 
as the specific order amending the FM Table of Allotments and allotting 
the FM channel(s) on which it plans to bid. An order adopted in an FM 
allotment rulemaking proceeding may include information unique to the 
allotment such as site restrictions or expense reimbursement 
requirements. Each potential bidder should perform technical analyses 
or refresh their previous analyses to assure itself that, should it 
become a winning bidder for any Auction 98 construction permit, it will 
be able to build and operate facilities that will fully comply with all 
applicable technical and legal requirements. Each applicant should 
inspect any prospective transmitter sites located in, or near, the 
service area for which it plans to bid, confirm the availability of 
such sites, and to familiarize itself with the Commission's rules 
regarding the National Environmental Policy Act at 47 CFR 1.1301-
1.1319.
    30. Each applicant should conduct its own research prior to Auction 
98 in order to determine the existence of pending administrative or 
judicial proceedings, including pending allocation rulemaking 
proceedings, that might affect its decision to participate in the 
auction. Each participant in Auction 98 to continue such research 
throughout the auction. The due diligence considerations mentioned in 
the Auction 98 Procedures Announcement do not comprise an exhaustive 
list of steps that should be undertaken prior to participating in this 
auction. As always, the burden is on the potential bidder to determine 
how much research to undertake, depending upon specific facts and 
circumstances related to its interests.
    31. Pending and future judicial proceedings, as well as certain 
pending and future proceedings before the Commission--including 
applications, applications for modification, petitions for rulemaking, 
requests for special temporary authority, waiver requests, petitions to 
deny, petitions for reconsideration, informal objections, and 
applications for review--may relate to particular applicants, incumbent 
permittees, incumbent licensees, or the construction permits available 
in Auction 98. Each prospective applicant is responsible for assessing 
the likelihood of the various possible outcomes and for considering the 
potential impact on construction permits available in this auction.
    32. Applicants are solely responsible for identifying associated 
risks and for investigating and evaluating the degree to which such 
matters may affect their ability to bid on, otherwise acquire, or make 
use of the construction permits available in Auction 98. Each potential 
bidder is responsible for undertaking research to ensure that any 
permits won in this auction will be suitable for its business plans and 
needs. Each potential bidder must undertake its own

[[Page 27576]]

assessment of the relevance and importance of information gathered as 
part of its due diligence efforts.
    33. Applicants may research the Media Bureau's licensing database 
in order to determine which channels are already licensed to incumbent 
licensees or previously authorized to construction permittees. 
Licensing records are contained in the Consolidated Database System 
(CDBS) and may be researched on the Internet from http://www.fcc.gov/encyclopedia/media-bureau-filing-systems-and-databases.
    34. The Commission makes no representations or guarantees regarding 
the accuracy or completeness of information in its databases or any 
third party databases, including, for example, court docketing systems. 
To the extent the Commission's databases may not include all 
information deemed necessary or desirable by an applicant, it must 
obtain or verify such information from independent sources or assume 
the risk of any incompleteness or inaccuracy in said databases. 
Furthermore, the Commission makes no representations or guarantees 
regarding the accuracy or completeness of information that has been 
provided by incumbent licensees and incorporated into its databases.
iv. Use of FCC Auction System
    35. Bidders will be able to participate in Auction 98 over the 
Internet using the Commission's web-based FCC Auction System. The 
Commission makes no warranty whatsoever with respect to the FCC Auction 
System. In no event shall the Commission, or any of its officers, 
employees, or agents, be liable for any damages whatsoever (including, 
but not limited to, loss of business profits, business interruption, 
loss of business information, or any other loss) arising out of or 
relating to the existence, furnishing, functioning, or use of the FCC 
Auction System that is accessible to qualified bidders in connection 
with this auction. Moreover, no obligation or liability will arise out 
of the Commission's technical, programming, or other advice or service 
provided in connection with the FCC Auction System.
v. Environmental Review Requirements
    36. Permittees or licensees must comply with the Commission's rules 
regarding implementation of the National Environmental Policy Act and 
other federal environmental statutes. The construction of a broadcast 
facility is a federal action, and the permittee or licensee must comply 
with the Commission's environmental rules at 47 CFR 1.1301-1.1319 for 
each such facility.

C. Auction Specifics

i. Bidding Methodology
    37. The bidding methodology for Auction 98 will be a simultaneous 
multiple round format. The Commission will conduct this auction over 
the Internet using the FCC Auction System. Qualified bidders are 
permitted to bid electronically via the Internet or by telephone using 
the telephonic bidding option. All telephone calls are recorded.
ii. Pre-Auction Dates and Deadlines
    38. The following dates and deadlines apply: (1) The Auction 
Tutorial will be available (via Internet) on May 18, 2015; (2) the 
Short-Form Application (FCC Form 175) Filing Window opens on May 18, 
2015 (12:00 noon ET); (3) the Short-Form Application (FCC Form 175) 
Filing Window deadline ends on May 28, 2015 (prior to 6:00 p.m. ET); 
(4) the Upfront Payments (via wire transfer) are due by June 29, 2015 
(6:00 p.m. ET); and (5) the Mock Auction will be held on July 20, 2015.
iii. Requirements for Participation
    39. Those wishing to participate in this auction must: (1) Submit a 
short-form application (FCC Form 175) electronically prior to 6:00 p.m. 
ET, on May 28, 2015, following the electronic filing procedures set 
forth in Attachment B to the Auction 98 Procedures Announcement; (2) 
Submit a sufficient upfront payment and an FCC Remittance Advice Form 
(FCC Form 159) by 6:00 p.m. ET, on June 29, 2015, following the 
procedures and instructions set forth in Attachment C to the Auctions 
98 Procedures Announcement; and (3) Comply with all provisions outlined 
in the Auction 98 Procedures Announcement and applicable Commission 
rules.

II. Short-Form Application (FCC Form 175) Requirements

A. General Information Regarding Short-Form Applications

    40. An application to participate in an FCC auction, referred to as 
a short-form application or FCC Form 175, provides information used to 
determine whether the applicant is legally, technically, and 
financially qualified to participate in Commission auctions for 
licenses or permits. The short-form application is the first part of 
the Commission's two-phased auction application process. In the first 
phase, parties desiring to participate in the auction must file a 
streamlined, short-form application in which they certify under penalty 
of perjury as to their qualifications. Eligibility to participate in 
bidding is based on the applicant's short-form application and 
certifications, and on its upfront payment. In the second phase of the 
process, each winning bidder must file a more comprehensive long-form 
application.
    41. Every entity and individual seeking a construction permit 
available in Auction 98 must file a short-form application 
electronically via the FCC Auction System prior to 6:00 p.m. ET on May 
28, 2015, following the procedures prescribed in Attachment B of the 
Auction 98 Procedures Announcement. If an applicant claims eligibility 
for a bidding credit, the information provided in its FCC Form 175 will 
be used to determine whether the applicant is eligible for the claimed 
bidding credit. Applicants filing a short-form application are subject 
to the Commission's rules against prohibited communications beginning 
at the deadline for filing.
    42. Every applicant bears full responsibility for submitting an 
accurate, complete and timely short-form application. An applicant must 
certify on its short-form application under penalty of perjury that it 
is legally, technically, financially and otherwise qualified to hold a 
license. Each applicant should read carefully the instructions set 
forth in Attachment B of the Auction 98 Procedures Announcement and 
should consult the Commission's rules to ensure that all the 
information required is included within its short-form application.
    43. An individual or entity may not submit more than one short-form 
application for a single auction. If a party submits multiple short-
form applications, only one application may be accepted for filing.
    44. Submission of a short-form application (and any amendments 
thereto) constitutes a representation by the certifying official that 
he or she is an authorized representative of the applicant, that he or 
she has read the form's instructions and certifications, and that the 
contents of the application, its certifications, and any attachments 
are true and correct. Applicants are not permitted to make major 
modifications to their applications; such impermissible changes include 
a change of the certifying official to the application. Submission of a 
false certification to the Commission may result in penalties, 
including monetary forfeitures, license forfeitures, ineligibility to 
participate in future auctions, and/or criminal prosecution.

[[Page 27577]]

B. Permit Selection

    45. An applicant must select the construction permits on which it 
wants to bid from the Eligible Permits list on its short-form 
application. To assist in identifying construction permits of interest 
that will be available in Auction 98, the FCC Auction System includes a 
filtering mechanism that allows an applicant to filter the Eligible 
Permits list. Selections for one or more of the filter criteria can be 
made and the system will produce a list of construction permits 
satisfying the specified criteria. Any or all of the construction 
permits in the filtered results may be selected. Applicants will also 
be able to select construction permits from one set of filtered results 
and then filter on different criteria to select additional construction 
permits.
    46. Applicants interested in participating in Auction 98 must have 
selected construction permit(s) available in this auction by the short-
form application filing deadline. Applicants must review and verify 
their construction permit selections before the deadline for submitting 
short-form applications. Construction permit selections cannot be 
changed after the short-form application filing deadline. The FCC 
Auction System will not accept bids on construction permits that were 
not selected on the applicant's short-form application.

C. New Entrant Bidding Credit

    47. The interests of the applicant, and of any individuals or 
entities with an attributable interest in the applicant, in other media 
of mass communications are considered when determining an applicant's 
eligibility for the New Entrant Bidding Credit. In Auction 98, the 
applicant's attributable interests and, thus, its maximum new entrant 
bidding credit eligibility are determined as of the short-form 
application filing deadline. An applicant intending to divest a media 
interest or make any other ownership changes, such as resignation of 
positional interests, in order to avoid attribution for purposes of 
qualifying for the New Entrant Bidding Credit must have consummated 
such divestment transactions or have completed such ownership changes 
by no later than the short-form filing deadline. Each applicant is 
reminded, however, that events occurring after the short-form filing 
deadline, such as the acquisition of attributable interests in media of 
mass communications, may cause diminishment or loss of the bidding 
credit, and must be reported immediately (no less than five business 
days after the event occurs). In this context, each applicant has a 
duty to continuously maintain the accuracy of information submitted in 
its auction application. Moreover, an applicant cannot qualify for a 
bidding credit, or upgrade a previously-claimed bidding credit, based 
on an ownership or positional change occurring after the short-form 
application filing deadline.
    48. Under traditional broadcast attribution rules, including 47 CFR 
73.3555 Note 2, those entities or individuals with an attributable 
interest in a bidder include: (1) All officers and directors of a 
corporate bidder; (2) Any owner of 5 percent or more of the voting 
stock of a corporate bidder; (3) All partners and limited partners of a 
partnership bidder, unless the limited partners are sufficiently 
insulated; and (4) All members of a limited liability company, unless 
sufficiently insulated.
    49. In cases where an applicant's spouse or close family member 
holds other media interests, such interests are not automatically 
attributable to the bidder. The Commission decides attribution issues 
in this context based on certain factors traditionally considered 
relevant.
    50. In the New Entrant Bidding Credit Reconsideration Order, 64 FR 
44856, Aug. 18, 1999, the Commission further refined the eligibility 
standards for the New Entrant Bidding Credit, judging it appropriate to 
attribute the media interests held by very substantial investors in, or 
creditors of, an applicant claiming new entrant status. Specifically, 
the attributable mass media interests held by an individual or entity 
with an equity and/or debt interest in an applicant shall be attributed 
to that applicant for purposes of determining its eligibility for the 
New Entrant Bidding Credit, if the equity and debt interests, in the 
aggregate, exceed 33 percent of the total asset value of the applicant, 
even if such an interest is non-voting.
    51. In the Diversity Order, 73 FR 28400, May 16, 2008, the 
Commission relaxed the equity/debt plus (EDP) attribution standard, to 
allow for higher investment opportunities in entities meeting the 
definition of eligible entities, 47 CFR 73.3555 Note 2(i). Consistent 
with a 2011 court decision, the relaxed equity and/or debt plus 
attribution standard for eligible entities as the basis for the New 
Entrant Bidding Credit will be unavailable in Auction 98.
    52. A medium of mass communications is defined in 47 CFR 
73.5008(b). Full power noncommercial educational stations, on both 
reserved and non-reserved channels, are included among media of mass 
communications as defined in 47 CFR 73.5008(b). Generally, media 
interests will be attributable for purposes of the New Entrant Bidding 
Credit to the same extent that such other media interests are 
considered attributable for purposes of the broadcast multiple 
ownership rules. However, attributable interests held by a winning 
bidder in existing low power television, television translator or FM 
translator facilities will not be counted among the applicant's other 
mass media interests in determining its eligibility for a New Entrant 
Bidding Credit. Further, any bidder asserting eligibility for new 
entrant bidding credit must have de facto as well as de jure control of 
the entity claiming the bidding credit.

D. Application Requirements

    53. In addition to the ownership information required pursuant to 
47 CFR 1.2105 and 1.2112, an applicant seeking a New Entrant Bidding 
Credit is required to establish on its short-form application that it 
satisfies the eligibility requirements to qualify for the bidding 
credit. In such case, a certification under penalty of perjury must be 
provided in completing the short-form application. An applicant 
claiming that it qualifies for a 35 percent New Entrant Bidding Credit 
must certify that neither it nor any of its attributable interest 
holders have any attributable interests in any other media of mass 
communications. An applicant claiming that it qualifies for a 25 
percent New Entrant Bidding Credit must certify that neither it nor any 
of its attributable interest holders has any attributable interests in 
more than three media of mass communications, and must identify and 
describe such media of mass communications.
i. Bidding Credits
    54. Applicants that qualify for the New Entrant Bidding Credit, as 
specified in 47 CFR 73.5007, are eligible for a bidding credit that 
represents the amount by which a bidder's winning bid is discounted. 
The size of a New Entrant Bidding Credit depends on the number of 
ownership interests in other media of mass communications that are 
attributable to the bidder-entity and its attributable interest-
holders. A 35 percent bidding credit will be given to a winning bidder 
if it, and/or any individual or entity with an attributable interest in 
the winning bidder, has no attributable interest in any other media of 
mass communications, as defined in 47 CFR 73.5008. A 25 percent bidding 
credit will be given to a winning bidder if it, and/or any individual 
or entity with an attributable interest in the

[[Page 27578]]

winning bidder, has an attributable interest in no more than three mass 
media facilities, as defined in 47 CFR 73.5008. No bidding credit will 
be given if any of the commonly owned mass media facilities serve the 
same area as the broadcast permit proposed in the auction, as defined 
in 47 CFR 73.5007(b), or if the winning bidder, and/or any individual 
or entity with an attributable interest in the winning bidder, has 
attributable interests in more than three mass media facilities. For 
purposes of determining whether a broadcast permit offered in this 
auction is in the same area as an applicant's existing mass media 
facilities, the coverage area of the to-be-auctioned facility is 
calculated using maximum class facilities at the allotment reference 
coordinates, not any applicant-specified preferred site coordinates.
    55. Bidding credits are not cumulative; qualifying applicants 
receive either the 25 percent or the 35 percent bidding credit, but not 
both. Attributable interests are defined in 47 CFR 73.3555 and note 2 
of that section. Applicants should note that unjust enrichment 
provisions apply to a winning bidder that utilizes a bidding credit and 
subsequently seeks to assign or transfer control of its license or 
construction permit to an entity not qualifying for the same level of 
bidding credit.

E. Ownership Disclosure Requirements

    56. For purposes of determining eligibility to participate in a 
broadcast auction, all applicants must comply with the uniform Part 1 
ownership disclosure standards and provide information required by 47 
CFR 1.2105 and 1.2112. Specifically, in completing the short-form 
application, applicants will be required to fully disclose information 
on the real party- or parties-in-interest and ownership structure of 
the applicant, including both direct and indirect ownership interests 
of 10 percent or more. The ownership disclosure standards for the 
short-form application are prescribed in 47 CFR 1.2105 and 1.2112. Each 
applicant is responsible for ensuring that information submitted in its 
short-form application is complete and accurate.
    57. In certain circumstances, an applicant's most current ownership 
information on file with the Commission, if in an electronic format 
compatible with the short-form application (FCC Form 175) (such as 
information submitted in an FCC Form 602 or in an FCC Form 175 filed 
for a previous auction using the FCC Auction System), will 
automatically be entered into its short-form application. Each 
applicant must carefully review any information automatically entered 
to confirm that it is complete and accurate as of the deadline for 
filing the short-form application. Any information that needs to be 
corrected or updated must be changed directly in the short-form 
application.

F. Provisions Regarding Former and Current Defaulters

    58. Current defaulters or delinquents are not eligible to 
participate in Auction 98, but former defaulters or delinquents can 
participate so long as they are otherwise qualified and make upfront 
payments that are fifty percent more than would otherwise be necessary. 
An applicant is considered a current defaulter or a current delinquent 
when it, any of its affiliates, any of its controlling interests, or 
any of the affiliates of its controlling interests, is in default on 
any payment for any Commission construction permit or license 
(including a down payment) or is delinquent on any non-tax debt owed to 
any Federal agency as of the filing deadline for short-form 
applications. An applicant is considered a former defaulter or a former 
delinquent when it, any of its affiliates, any of its controlling 
interests, or any of the affiliates of its controlling interests, have 
defaulted on any Commission construction permit or license or been 
delinquent on any non-tax debt owed to any Federal agency, but have 
since remedied all such defaults and cured all of the outstanding non-
tax delinquencies.
    59. On the short-form application, an applicant must certify under 
penalty of perjury that it, its affiliates, its controlling interests, 
and the affiliates of its controlling interests, as defined by 47 CFR 
1.2110, are not in default on any payment for a Commission construction 
permit or license (including down payments) and that it is not 
delinquent on any non-tax debt owed to any Federal agency. Each 
applicant must also state under penalty of perjury whether it, its 
affiliates, its controlling interests, and the affiliates of its 
controlling interests, have ever been in default on any Commission 
construction permit or license or have ever been delinquent on any non-
tax debt owed to any Federal agency. Submission of a false 
certification to the Commission is a serious matter that may result in 
severe penalties, including monetary forfeitures, license revocations, 
exclusion from participation in future auctions, and/or criminal 
prosecution.
    60. Applicants are encouraged to review the Bureaus' previous 
guidance on default and delinquency disclosure requirements in the 
context of the short-form application process. For example, to the 
extent that Commission rules permit late payment of regulatory or 
application fees accompanied by late fees, such debts will become 
delinquent for purposes of 47 CFR 1.2105(a) and 1.2106(a) only after 
the expiration of a final payment deadline. Therefore, with respect to 
regulatory or application fees, the provisions of 47 CFR 1.2105(a) and 
1.2106(a) regarding default and delinquency in connection with 
competitive bidding are limited to circumstances in which the relevant 
party has not complied with a final Commission payment deadline. 
Failure to comply, however, with the terms of a demand letter in the 
time period specified may render the subject debt delinquent, 
notwithstanding rules generally permitting late payment. Parties are 
encouraged to consult with the Wireless Telecommunications Bureau's 
Auctions and Spectrum Access Division staff if they have any questions 
about default and delinquency disclosure requirements.
    61. The Commission considers outstanding debts owed to the United 
States Government, in any amount, to be a serious matter. The 
Commission adopted rules, including a provision referred to as the red 
light rule, that implement its obligations under the Debt Collection 
Improvement Act of 1996, which governs the collection of debts owed to 
the United States. Under the red light rule, applications and other 
requests for benefits filed by parties that have outstanding debts owed 
to the Commission will not be processed. In the same rulemaking order, 
the Commission explicitly declared, however, that its competitive 
bidding rules are not affected by the red light rule. As a consequence, 
the Commission's adoption of the red light rule does not alter the 
applicability of any of its competitive bidding rules, including the 
provisions and certifications of 47 CFR 1.2105 and 1.2106, with regard 
to current and former defaults or delinquencies.
    62. Applicants are reminded, however, that the Commission's Red 
Light Display System, which provides information regarding debts 
currently owed to the Commission, may not be determinative of an 
auction applicant's ability to comply with the default and delinquency 
disclosure requirements of 47 CFR 1.2105. Thus, while the red light 
rule ultimately may prevent the processing of long-form applications by 
auction winners, an auction applicant's lack of current red light 
status is not necessarily determinative of its

[[Page 27579]]

eligibility to participate in an auction or of its upfront payment 
obligation.
    63. Moreover, prospective applicants in Auction 98 should note that 
any long-form applications filed after the close of bidding will be 
reviewed for compliance with the Commission's red light rule, and such 
review may result in the dismissal of a winning bidder's long-form 
application. Further, an applicant that has its long-form application 
dismissed will be deemed to have defaulted and will be subject to 
default payments under 47 CFR 1.2104(g) and 1.2109(c).

G. Optional Applicant Status Identification

    64. Applicants owned by members of minority groups and/or women, as 
defined in 47 CFR 1.2110(c)(3), and rural telephone companies, as 
defined in 47 CFR 1.2110(c)(4), may identify themselves regarding this 
status in filling out their short-form applications. This applicant 
status information is collected for statistical purposes only and 
assists the Commission in monitoring the participation of designated 
entities in its auctions.

H. Noncommercial Educational Status Election

    65. If an FCC Form 175 filed during the Auction 98 filing window 
identifying the application's proposed station as noncommercial 
educational (NCE) is mutually exclusive with any application filed 
during that window for a commercial station, the NCE application will 
be returned as unacceptable for filing. Auction applications selecting 
the same FM station construction permit are considered mutually 
exclusive. Each prospective applicant in this auction should consider 
carefully if it wishes to propose NCE operation for any FM station 
acquired in this auction. This NCE election cannot be reversed after 
the initial application filing deadline.

I. Minor Modifications to Short-Form Applications

    66. After the deadline for filing initial applications, an Auction 
98 applicant is permitted to make only minor changes to its 
application. Permissible minor changes include, among other things, 
deletion and addition of authorized bidders (to a maximum of three) and 
revision of addresses and telephone numbers of the applicants and their 
contact persons. An applicant is not permitted to make a major 
modification to its application (e.g., change of construction permit 
selection, change control of the applicant, change the certifying 
official, claim eligibility for a higher percentage of bidding credit, 
or change the identification of the application's proposed facilities 
as noncommercial educational) after the initial application filing 
deadline. Thus, any change in control of an applicant, resulting from a 
merger, for example, will be considered a major modification, and the 
application will consequently be dismissed. If an applicant's short-
form application is dismissed, the applicant would remain subject to 
the communication prohibitions of 47 CFR 1.2105(c) until the down 
payment deadline, which will be established after the auction closes.
    67. If an applicant wishes to make permissible minor changes to its 
short-form application, such changes should be made electronically to 
its short-form application using the FCC Auction System whenever 
possible. For the change to be submitted and considered by the 
Commission, be sure to click on the SUBMIT button. After the revised 
application has been submitted, a confirmation page will be displayed 
stating the submission time, submission date, and a unique file number.
    68. An applicant cannot use the FCC Auction System outside of the 
initial and resubmission filing windows to make changes to its short-
form application for other than administrative changes (e.g., changing 
certain contact information or the name of an authorized bidder). If 
these or other permissible minor changes need to be made outside of 
these windows, the applicant must submit a letter briefly summarizing 
the changes and subsequently update its short-form application in the 
FCC Auction System once it is available. Moreover, after the filing 
window has closed, the system will not permit applicants to make 
certain changes, such as the applicant's legal classification and the 
identification of the application's proposed facilities as 
noncommercial educational.
    69. Any letter describing changes to an applicant's short-form 
application must be submitted by email to [email protected]. The email 
summarizing the changes must include a subject or caption referring to 
Auction 98 and the name of the applicant, for example, Re: Changes to 
Auction 98 Short-Form Application of ABC Corp. The Bureaus request that 
parties format any attachments to email as Adobe[supreg] 
Acrobat[supreg] (pdf) or Microsoft[supreg] Word documents. Questions 
about short-form application amendments should be directed to the 
Auctions and Spectrum Access Division at (202) 418-0660.
    70. Any application amendment and related statements of fact must 
be certified by an authorized representative of the applicant having 
authority to bind the applicant.
    71. Applicants must not submit application-specific material 
through the Commission's Electronic Comment Filing System, which was 
used for submitting comments regarding Auction 98.

J. Maintaining Current Information in Short-Form Applications

    72. 47 CFR 1.65 and 1.2105(b) require an applicant to maintain the 
accuracy and completeness of information furnished in its pending 
application and in competitive bidding proceedings to furnish 
additional or corrected information to the Commission within five 
business days of a significant occurrence, or to amend a short-form 
application no more than five business days after the applicant becomes 
aware of the need for the amendment. Changes that cause a loss of or 
reduction in the percentage of bidding credit specified on the 
originally-submitted application must be reported immediately, and no 
later than five business days after the change occurs. If an amendment 
reporting changes is a major amendment, as defined by 47 CFR 1.2105, 
the major amendment will not be accepted and may result in the 
dismissal of the application. For example, if ownership changes result 
in the attribution of new interest holders that affect the applicant's 
qualifications for a new entrant bidding credit, such information must 
be clearly stated in the applicant's amendment. After the short-form 
filing deadline, applicants may make only minor changes to their 
applications. For changes to be submitted and considered by the 
Commission, be sure to click on the SUBMIT button in the FCC Auction 
System. In addition, an applicant cannot update its short-form 
application using the FCC Auction System after the initial and 
resubmission filing windows close. If information needs to be submitted 
pursuant to 47 CFR 1.65 after these windows close, a letter briefly 
summarizing the changes must be submitted by email to 
[email protected]. This email must include a subject or caption 
referring to Auction 98 and the name of the applicant. The Bureaus 
request that parties format any attachments to email as Adobe[supreg] 
Acrobat[supreg] (pdf) or Microsoft[supreg] Word documents.

[[Page 27580]]

III. Pre-Auction Procedures

A. Online Auction Tutorial--Available May 18, 2015

    73. By Monday, May 18, 2015, an interactive auction tutorial will 
be available on the Auction 98 Web page for prospective bidders to 
familiarize themselves with the auction process. This online tutorial 
will provide information about pre-auction procedures, completing 
short-form applications, auction conduct, the FCC Auction Bidding 
System, auction rules, and broadcast services rules. The tutorial will 
also provide an avenue to ask FCC staff questions about the auction, 
auction procedures, filing requirements, and other matters related to 
this auction.
    74. The auction tutorial will be accessible through a Web browser 
with Adobe Flash Player from the FCC's Auction 98 Web page at http://wireless.fcc.gov/auctions/98/ through an Auction Tutorial link. Once 
posted, this tutorial will remain available and accessible anytime for 
reference in connection with the procedures outlined in the Auction 98 
Procedures Announcement.

B. Short-Form Applications--Due Prior to 6:00 p.m. ET on May 28, 2015

    75. In order to be eligible to bid in this auction, applicants must 
first follow the procedures set forth in Attachment B to the Auction 98 
Procedures Announcement to submit a short-form application (FCC Form 
175) electronically via the FCC Auction System. This short-form 
application must be submitted prior to 6:00 p.m. ET on May 28, 2015. 
Late applications will not be accepted. No application fee is required, 
but an applicant must submit a timely and sufficient upfront payment to 
be eligible to bid.
    76. Applications may generally be filed at any time beginning at 
noon ET on May 18, 2015, until the filing window closes at 6:00 p.m. ET 
on May 28, 2015. Applicants are strongly encouraged to file early and 
are responsible for allowing adequate time for filing their 
applications. Applications can be updated or amended multiple times 
until the filing deadline on May 28, 2015.
    77. An applicant must always click on the SUBMIT button on the 
Certify & Submit screen to successfully submit its FCC Form 175 and any 
modifications; otherwise the application or changes to the application 
will not be received or reviewed by Commission staff. Additional 
information about accessing, completing, and viewing the FCC Form 175 
is included in Attachment B to the Auction 98 Procedures Announcement. 
FCC Auctions Technical Support is available at (877) 480-3201, option 
nine; (202) 414-1250; or (202) 414-1255 (text telephone (TTY)); hours 
of service are Monday through Friday, from 8:00 a.m. to 6:00 p.m. ET. 
In order to provide better service to the public, all calls to 
Technical Support are recorded.

C. Application Processing and Minor Corrections

    78. After the deadline for filing FCC Form 175 applications, the 
Commission will process all timely submitted applications to determine 
which are complete, and subsequently will issue a public notice 
identifying (1) those that are complete; (2) those that are rejected; 
and (3) those that are incomplete or deficient because of minor defects 
that may be corrected. That public notice will include the deadline for 
resubmitting corrected applications.
    79. Non-mutually exclusive applications will be listed in a 
subsequent public notice to be released by the Bureaus. Such 
applications will not proceed to auction, but will proceed in 
accordance with instructions set forth in that public notice. All 
mutually exclusive applications will be considered under the relevant 
procedures for conflict resolution. Mutually exclusive applications 
proposing commercial stations will proceed to auction.
    80. After the application filing deadline on May 28, 2015, 
applicants can make only minor corrections to their applications. They 
will not be permitted to make major modifications (e.g., change 
construction permit selection, change control of the applicant, change 
the certifying official, claim eligibility for a higher percentage of 
bidding credit, or change identification of the application's proposed 
facilities as NCE).
    81. Commission staff will communicate only with an applicant's 
contact person or certifying official, as designated on the short-form 
application, unless the applicant's certifying official or contact 
person notifies the Commission in writing that applicant's counsel or 
other representative is authorized to speak on its behalf. 
Authorizations may be sent by email to [email protected].

D. Upfront Payments--Due June 29, 2015

    82. In order to be eligible to bid in this auction, an upfront 
payment must be submitted and accompanied by an FCC Remittance Advice 
Form (FCC Form 159). After completing its short-form application, an 
applicant will have access to an electronic version of the FCC Form 159 
that can be printed and sent by fax to U.S. Bank in St. Louis, 
Missouri. All upfront payments must be made as instructed in the 
Auction 98 Procedures Announcement and must be received in the proper 
account at U.S. Bank before 6:00 p.m. ET on June 29, 2015.
i. Making Upfront Payments by Wire Transfer
    83. An applicant must initiate its wire transfer through its bank, 
authorizing the bank to wire funds from the applicant's account to the 
Commission's auction payment lockbox bank, the U.S. Bank in St. Louis, 
Missouri. Wire transfer payments must be received before 6:00 p.m. ET 
on June 29, 2015. No other payment method is acceptable. To avoid 
untimely payments, applicants should discuss arrangements (including 
bank closing schedules) with their bankers several days before they 
plan to make the wire transfer, and allow sufficient time for the 
transfer to be initiated and completed before the deadline.
    84. At least one hour before placing the order for the wire 
transfer (but on the same business day), applicants must fax a 
completed FCC Form 159 (Revised 2/03) to U.S. Bank at (314) 418-4232. 
On the fax cover sheet, write Wire Transfer--Auction Payment for 
Auction 98. In order to meet the upfront payment deadline, an 
applicant's payment must be credited to the Commission's account for 
Auction 98 before the deadline.
    85. Each applicant is responsible for ensuring timely submission of 
its upfront payment and for timely filing of an accurate and complete 
FCC Remittance Advice Form (FCC Form 159). An applicant should 
coordinate with its financial institution well ahead of the due date 
regarding its wire transfer and allow sufficient time for the transfer 
to be initiated and completed prior to the deadline. The Commission 
repeatedly has cautioned auction participants about the importance of 
planning ahead to prepare for unforeseen last-minute difficulties in 
making payments by wire transfer. Each applicant also is responsible 
for obtaining confirmation from its financial institution that its wire 
transfer to U.S. Bank was successful and from Commission staff that its 
upfront payment was timely received and that it was deposited into the 
proper account. To receive confirmation from Commission staff, contact 
Gail Glasser of the Office of Managing Director's Revenue & Receivables 
Operations Group/Auctions at (202) 418-0578, or

[[Page 27581]]

alternatively, Theresa Meeks at (202) 418-2945.
    86. All payments must be made in U.S. dollars. All payments must be 
made by wire transfer. Upfront payments for Auction 98 go to a lockbox 
number different from the lockboxes used in previous FCC auctions. 
Failure to deliver a sufficient upfront payment as instructed in the 
Auction 98 Procedures Announcement by the deadline on June 29, 2015 
will result in dismissal of the short-form application and 
disqualification from participation in the auction. Any applicant that 
submits a short-form application but fails to timely submit an upfront 
payment will retain its status as an Auction 98 applicant and will 
remain subject to 47 CFR 12105(c) and 73.5002(d), but, having purchased 
no bidding eligibility, will not be eligible to bid.
ii. FCC Form 159
    87. An accurate and complete FCC Remittance Advice Form (FCC Form 
159, Revised 2/03) must be faxed to U.S. Bank to accompany each upfront 
payment. Proper completion of this form is critical to ensuring correct 
crediting of upfront payments. Detailed instructions for completion of 
FCC Form 159 are included in Attachment C of the Auction 98 Procedures 
Announcement. An electronic pre-filled version of the FCC Form 159 is 
available after submitting the FCC Form 175. Payers using the pre-
filled FCC Form 159 are responsible for ensuring that all of the 
information on the form, including payment amounts, is accurate. The 
FCC Form 159 can be completed electronically, but it must be filed with 
U.S. Bank by fax.
iii. Upfront Payments and Bidding Eligibility
    88. An applicant must make an upfront payment sufficient to obtain 
bidding eligibility on the construction permits on which it will bid. 
The amount of the upfront payment will determine a bidder's initial 
bidding eligibility, the maximum number of bidding units on which a 
bidder may place bids. In order to bid on a particular construction 
permit, a qualified bidder must have selected the construction permit 
on its FCC Form 175 and must have a current eligibility level that 
meets or exceeds the number of bidding units assigned to that 
construction permit. At a minimum, therefore, an applicant's total 
upfront payment must be enough to establish eligibility to bid on at 
least one of the construction permits selected on its FCC Form 175, or 
else the applicant will not be eligible to participate in the auction. 
An applicant does not have to make an upfront payment to cover all 
construction permits the applicant selected on its FCC Form 175, but 
only enough to cover the maximum number of bidding units that are 
associated with construction permits on which they wish to place bids 
and hold provisionally winning bids in any given round. (A 
provisionally winning bid is a bid that would become a final winning 
bid if the auction were to close after a specific round.) The total 
upfront payment does not affect the total dollar amount the bidder may 
bid on any given construction permit.
    89. The specific upfront payment amounts and bidding units for each 
construction permit in Auction 98 are set forth in Attachment A of the 
Auction 98 Procedures Announcement.
    90. In calculating its upfront payment amount, an applicant should 
determine the maximum number of bidding units on which it may wish to 
be active (bid on or hold provisionally winning bids on) in any single 
round, and submit an upfront payment amount covering that number of 
bidding units. In order to make this calculation, an applicant should 
add together the bidding units for all construction permits on which it 
seeks to be active in any given round. Applicants should check their 
calculations carefully, as there is no provision for increasing a 
bidder's eligibility after the upfront payment deadline.
    91. 47 CFR 1.2106(a) requires that an applicant that is a former 
defaulter must submit an upfront payment 50 percent greater than other 
applicants. For purposes of this calculation, the applicant includes 
the applicant itself, its affiliates, its controlling interests, and 
affiliates of its controlling interests, as defined by 47 CFR 1.2110. 
If an applicant is a former defaulter, it must calculate its upfront 
payment for all of its identified construction permits by multiplying 
the number of bidding units on which it wishes to be active by 1.5. In 
order to calculate the number of bidding units to assign to former 
defaulters, the Commission will divide the upfront payment received by 
1.5 and round the result up to the nearest bidding unit. If a former 
defaulter fails to submit a sufficient upfront payment to establish 
eligibility to bid on at least one of the construction permits selected 
on its FCC Form 175, the applicant will not be eligible to participate 
in bidding. This applicant will retain its status as an applicant in 
Auction 98 and will remain subject to 47 CFR 1.2105(c) and 73.5002(d).

E. Applicant's Wire Transfer Information for Purposes of Refunds of 
Upfront Payments

    92. To ensure that refunds of upfront payments are processed in an 
expeditious manner, the Commission is requesting that all pertinent 
information specified in the Auction 98 Procedures Announcement be 
submitted. Applicants can provide the information electronically during 
the initial short-form application filing window after the form has 
been submitted. (Applicants are reminded that information submitted as 
part of an FCC Form 175 will be available to the public; for that 
reason, wire transfer information should not be included in an FCC Form 
175.) Instructions for submission of refund wire transfer information 
by fax were provided in the Auction 98 Procedures Announcement. All 
refunds will be returned to the payer of record as identified on the 
FCC Form 159 unless the payer submits written authorization instructing 
otherwise.

F. Auction Registration

    93. Approximately ten days before the auction, the Bureaus will 
issue a public notice announcing all qualified bidders for the auction. 
Qualified bidders are those applicants with submitted FCC Form 175 
applications that are deemed timely-filed, accurate, and complete, 
provided that such applicants have timely submitted an upfront payment 
that is sufficient to qualify them to bid.
    94. All qualified bidders are automatically registered for the 
auction. Registration materials will be distributed prior to the 
auction by overnight mail. The mailing will be sent only to the contact 
person at the contact address listed in the FCC Form 175 and will 
include the SecurID[supreg] tokens that will be required to place bids, 
the FCC Auction System Bidder's Guide, and the Auction Bidder Line 
telephone number.
    95. Qualified bidders that do not receive this registration mailing 
will not be able to submit bids. Therefore, if this mailing is not 
received by noon on Thursday, July 16, 2015, a qualified bidder must 
call the Auctions Hotline at (717) 338-2868. Receipt of this 
registration mailing is critical to participating in the auction, and 
each applicant is responsible for ensuring it has received all of the 
registration materials.
    96. In the event that SecurID[supreg] tokens are lost or damaged, 
only a person who has been designated as an authorized bidder, the 
contact person, or the certifying official on the applicant's short-
form application may request replacements. To request replacement of

[[Page 27582]]

these items, call Technical Support at (877) 480-3201, option nine; 
(202) 414-1250; or (202) 414-1255 (TTY).

G. Remote Electronic Bidding

    97. The Commission will conduct this auction over the Internet, and 
telephonic bidding will be available as well. Only qualified bidders 
are permitted to bid. Each applicant should indicate its bidding 
preference--electronic or telephonic--on its FCC Form 175. In either 
case, each authorized bidder must have its own SecurID[supreg] token, 
which the Commission will provide at no charge. Each applicant with one 
authorized bidder will be issued two SecurID[supreg] tokens, while 
applicants with two or three authorized bidders will be issued three 
tokens. For security purposes, the SecurID[supreg] tokens, the 
telephonic bidding telephone number, and the FCC Auction System 
Bidder's Guide are only mailed to the contact person at the contact 
address listed on the FCC Form 175. Each SecurID[supreg] token is 
tailored to a specific auction. SecurID[supreg] tokens issued for other 
auctions or obtained from a source other than the FCC will not work for 
Auction 98.

H. Mock Auction--July 20, 2015

    98. All qualified bidders will be eligible to participate in a mock 
auction on Monday, July 20, 2015. The mock auction will enable bidders 
to become familiar with the FCC Auction System prior to the auction. 
The Bureaus strongly recommend that all bidders participate in the mock 
auction. Details will be announced by public notice.

IV. Auction

    99. The first round of bidding for Auction 98 will begin on 
Thursday, July 23, 2015. The initial bidding schedule will be announced 
in a public notice listing the qualified bidders, which is released 
approximately 10 days before the start of the auction.

A. Auction Structure

i. Simultaneous Multiple Round Auction
    100. In Auction 98, all construction permits will be auctioned in a 
single auction using the Commission's standard simultaneous multiple-
round auction format. This type of auction offers every construction 
permit for bid at the same time and consists of successive bidding 
rounds in which eligible bidders may place bids on individual 
construction permits. A bidder may bid on, and potentially win, any 
number of construction permits. Unless otherwise announced, bids will 
be accepted on all construction permits in each round of the auction 
until bidding stops on every construction permit.
ii. Eligibility and Activity Rules
    101. The Bureaus will use upfront payments to determine initial 
(maximum) eligibility (as measured in bidding units) for Auction 98. 
The amount of the upfront payment submitted by a bidder determines 
initial bidding eligibility, the maximum number of bidding units on 
which a bidder may be active. Each construction permit is assigned a 
specific number of bidding units as listed in Attachment A to the 
Auction 98 Procedures Announcement. Bidding units assigned to each 
construction permit do not change as prices rise during the auction. 
Upfront payments are not attributed to specific construction permits. 
Rather, a bidder may place bids on any of the construction permits 
selected on its FCC Form 175 as long as the total number of bidding 
units associated with those construction permits does not exceed the 
bidder's current eligibility. Eligibility cannot be increased during 
the auction; it can only remain the same or decrease. Thus, in 
calculating its upfront payment amount, an applicant must determine the 
maximum number of bidding units it may wish to bid on or hold 
provisionally winning bids on in any single round, and submit an 
upfront payment amount covering that total number of bidding units. At 
a minimum, an applicant's upfront payment must cover the bidding units 
for at least one of the construction permits it selected on its short-
form application. The total upfront payment does not affect the total 
dollar amount a bidder may bid on any given construction permit.
    102. In order to ensure that an auction closes within a reasonable 
period of time, an activity rule requires bidders to bid actively 
throughout the auction, rather than wait until late in the auction 
before participating. Bidders are required to be active on a specific 
percentage of their current bidding eligibility during each round of 
the auction. A bidder's activity level in a round is the sum of the 
bidding units associated with construction permits covered by the 
bidder's new and provisionally winning bids from the previous round.
    103. The minimum required activity is expressed as a percentage of 
the bidder's current eligibility, and increases by stage as the auction 
progresses. Failure to maintain the requisite activity level will 
result in the use of an activity rule waiver, if any remain, or a 
reduction in the bidder's eligibility, possibly curtailing or 
eliminating the bidder's ability to place additional bids in the 
auction.
iii. Auction Stages
    104. In Auction 98, a bidder desiring to maintain its current 
bidding eligibility will be required to be active on construction 
permits representing at least 80 percent of its current eligibility, 
during each round of Stage One, and at least 95 percent of its current 
bidding eligibility on Stage Two.
    105. Failure to maintain the required activity level will result in 
the use of an activity rule waiver or, if the bidder has no activity 
rule waivers remaining, a reduction in the bidder's bidding eligibility 
in the next round. During Stage One, reduced eligibility for the next 
round will be calculated by multiplying the bidder's current round 
activity (the sum of bidding units of the bidder's provisionally 
winning bids and bids during the current round) by five-fourths (\5/
4\). During Stage Two, reduced eligibility for the next round will be 
calculated by multiplying the bidder's current round activity (the sum 
of bidding units of the bidder's provisionally winning bids and bids 
during the current round) by twenty-nineteenths (\20/19\).
    CAUTION: Since activity requirements increase in Stage Two, bidders 
must carefully check their activity during the first round following a 
stage transition to ensure that they are meeting the increased activity 
requirement. This is especially critical for bidders that have 
provisionally winning bids and do not plan to submit new bids. In past 
auctions, some bidders have inadvertently lost bidding eligibility or 
used an activity rule waiver because they did not re-verify their 
activity status at stage transitions. Bidders may check their activity 
against the required activity level by logging into the FCC Auction 
System.
    106. When the Bureaus move the auction from Stage One to Stage Two, 
they will first alert bidders by announcement in the bidding system. 
The stage of the auction does not affect the auction stopping rules; 
the auction may conclude in Stage One. The Bureaus have the discretion 
to further alter the activity requirements before and/or during the 
auction as circumstances warrant.
iv. Stage Transitions
    107. Auction 98 will start in Stage One. The Bureaus will regulate 
the pace of the auction by announcement. The Bureaus retain the 
discretion to transition the auction to Stage Two, to add an additional 
stage with a higher

[[Page 27583]]

activity requirement, not to transition to Stage Two, and to transition 
to Stage Two with an activity requirement that is higher or lower than 
95 percent. This determination will be based on a variety of measures 
of auction activity, including, but not limited to, the number of new 
bids and the percentages of construction permits (as measured in 
bidding units) on which there are new bids.
v. Activity Rule Waivers
    108. Each qualified bidder in the auction will be provided with 
three activity rule waivers. Bidders may use an activity rule waiver in 
any round during the course of the auction. Use of an activity rule 
waiver preserves the bidder's eligibility despite its activity in the 
current round being below the required minimum activity level. An 
activity rule waiver applies to an entire round of bidding and not to a 
particular construction permit. Waivers can be either proactive or 
automatic and are principally a mechanism for auction participants to 
avoid the loss of bidding eligibility in the event that exigent 
circumstances prevent them from placing a bid in a particular round.
    109. The FCC Auction System assumes that a bidder with insufficient 
activity would prefer to apply an activity rule waiver (if available) 
rather than lose bidding eligibility. Therefore, the system will 
automatically apply a waiver at the end of any bidding round in which a 
bidder's activity level is below the minimum required unless (1) the 
bidder has no activity rule waivers remaining or (2) the bidder 
overrides the automatic application of a waiver by reducing 
eligibility. If no waivers remain and the activity requirement is not 
satisfied, the FCC Auction System will permanently reduce the bidder's 
eligibility, possibly curtailing or eliminating the ability to place 
additional bids in the auction.
    110. A bidder with insufficient activity may wish to reduce its 
bidding eligibility rather than use an activity rule waiver. If so, the 
bidder must affirmatively override the automatic waiver mechanism 
during the bidding round by using the reduce eligibility function in 
the FCC Auction System. In this case, the bidder's eligibility is 
permanently reduced to bring it into compliance with the activity rule. 
Reducing eligibility is an irreversible action; once eligibility has 
been reduced, a bidder will not be permitted to regain its lost bidding 
eligibility, even if the round has not yet closed.
    111. Finally, a bidder may apply an activity rule waiver 
proactively as a means to keep the auction open without placing a bid. 
If a proactive waiver is applied (using the apply waiver function in 
the FCC Auction System) during a bidding round in which no bids are 
placed, the auction will remain open and the bidder's eligibility will 
be preserved. However, an automatic waiver applied by the FCC Auction 
System in a round in which there are no new bids or proactive waivers 
will not keep the auction open. A bidder cannot submit a proactive 
waiver after bidding in a round, and applying a proactive waiver will 
preclude it from placing any bids in that round. Applying a waiver is 
irreversible; once a bidder submits a proactive waiver, the bidder 
cannot unsubmit the waiver even if the round has not yet ended.
vi. Auction Stopping Rules
    112. For Auction 98, the Bureaus will employ a simultaneous 
stopping rule approach, which means all construction permits remain 
available for bidding until bidding stops simultaneously on every 
construction permit. More specifically, bidding will close on all 
construction permits after the first round in which no bidder submits 
any new bids or applies a proactive waiver.
    113. The Bureaus also adopted alternative versions of the 
simultaneous stopping rule for Auction 98. Option 1: The auction would 
close for all construction permits after the first round in which no 
bidder applies a proactive waiver or places any new bids on any 
construction permit on which it is not the provisionally winning 
bidder. Thus, absent any other bidding activity, a bidder placing a new 
bid on a construction permit for which it is the provisionally winning 
bidder would not keep the auction open under this modified stopping 
rule. Option 2: The auction would close for all construction permits 
after the first round in which no bidder applies a waiver or places any 
new bids on any construction permit that is not FCC held. Thus, absent 
any other bidding activity, a bidder placing a new bid on a 
construction permit that does not already have a provisionally winning 
bid (an FCC-held construction permit) would not keep the auction open 
under this modified stopping rule. Option 3: The auction would close 
using a modified version of the simultaneous stopping rule that 
combines options 1 and 2 above. Option 4: The auction would end after a 
specified number of additional rounds. If the Bureaus invoke this 
special stopping rule, it will accept bids in the specified final 
round(s), after which the auction will close. Option 5: The auction 
would remain open even if no bidder places any new bids or applies a 
waiver. In this event, the effect will be the same as if a bidder had 
applied a waiver. Thus, the activity rule will apply as usual, and a 
bidder with insufficient activity will either lose bidding eligibility 
or use a waiver.
    114. The Bureaus proposed to exercise these options only in certain 
circumstances, for example, where the auction is proceeding unusually 
slowly or quickly, there is minimal overall bidding activity, or it 
appears likely that the auction will not close within a reasonable 
period of time or will close prematurely. Before exercising these 
options, the Bureaus are likely to attempt to change the pace of the 
auction. For example, the Bureaus may adjust the pace of bidding by 
changing the number of bidding rounds per day and/or the minimum 
acceptable bids. The Bureaus retained the discretion to exercise any of 
these options with or without prior announcement during the auction.
vii. Auction Delay, Suspension, or Cancellation
    115. By public notice or by announcement during the auction, the 
Bureaus may delay, suspend, or cancel the auction in the event of 
natural disaster, technical obstacle, administrative or weather 
necessity, evidence of an auction security breach or unlawful bidding 
activity, or for any other reason that affects the fair and efficient 
conduct of competitive bidding. In such cases, the Bureaus, in their 
sole discretion, may elect to resume the auction starting from the 
beginning of the current round or from some previous round, or cancel 
the auction in its entirety. Network interruption may cause the Bureaus 
to delay or suspend the auction. The Bureaus will exercise this 
authority solely at its discretion, and not as a substitute for 
situations in which bidders may wish to apply their activity rule 
waivers.

B. Bidding Procedures

i. Round Structure
    116. The initial schedule of bidding rounds will be announced in 
the public notice listing the qualified bidders, which is released 
approximately 10 days before the start of the auction. Each bidding 
round is followed by the release of round results. Multiple bidding 
rounds may be conducted each day.
    117. The Bureaus have the discretion to change the bidding schedule 
in order to foster an auction pace that reasonably balances speed with 
the bidders' need to study round results and adjust their bidding 
strategies. The Bureaus may

[[Page 27584]]

change the amount of time for the bidding rounds, the amount of time 
between rounds, or the number of rounds per day, depending upon bidding 
activity and other factors.
ii. Reserve Price and Minimum Opening Bids
    118. The Bureaus did not establish reserve prices for the 
construction permits in Auction 98. The Bureaus did, however, establish 
minimum opening bids for each construction permit in this auction. 
After further consideration, the Bureaus adjusted the minimum opening 
bid amount for one construction permit, MM-FM1076-A, at Maysville, 
Georgia, in response to concerns raised by a commenter. The Bureaus 
made corresponding changes to the upfront payment amount and the 
bidding units associated with this construction permit. The specific 
minimum opening bid amount for each construction permit available in 
Auction 98 is specified in Attachment A of the Auction 98 Procedures 
Announcement.
iii. Bid Amounts
    119. In each round of Auction 98, an eligible bidder will be able 
to place a bid on a given construction permit in any of up to nine 
different amounts, if the bidder has sufficient eligibility to place a 
bid on the particular construction permit. The FCC Auction System 
interface will list the nine acceptable bid amounts for each 
construction permit. In the event of duplicate bid amounts due to 
rounding, the FCC Auction System will omit the duplicates and will list 
fewer acceptable bid amounts for that permit.
    120. The first of the acceptable bid amounts is called the minimum 
acceptable bid amount. The minimum acceptable bid amount for a 
construction permit will be equal to its minimum opening bid amount 
until there is a provisionally winning bid for the construction permit. 
After there is a provisionally winning bid for a permit, the minimum 
acceptable bid amount will be a certain percentage higher. That is, the 
minimum acceptable bid amount will be calculated by multiplying the 
provisionally winning bid amount times one plus the minimum acceptable 
bid percentage. Bureaus will begin the auction with a minimum 
acceptable bid percentage of 10 percent. Thus, the minimum acceptable 
bid amount will equal (provisionally winning bid amount) * (1.10), 
rounded.
    121. The eight additional bid amounts will be calculated using the 
minimum acceptable bid amount and a bid increment percentage, which 
will be 5 percent for the beginning of Auction 98. The first additional 
acceptable bid amount equals the minimum acceptable bid amount times 
one plus the bid increment percentage, rounded. For Auction 98, the 
calculation is (minimum acceptable bid amount) * (1 + 0.05), rounded, 
or (minimum acceptable bid amount) * 1.05, rounded; the second 
additional acceptable bid amount equals the minimum acceptable bid 
amount times one plus two times the bid increment percentage, rounded, 
or (minimum acceptable bid amount) * 1.10, rounded; the third 
additional acceptable bid amount equals the minimum acceptable bid 
amount times one plus three times the bid increment percentage, 
rounded, or (minimum acceptable bid amount) * 1.15, rounded; etc. The 
Bureaus will round the results of these calculations using the standard 
rounding procedures for auctions. The Bureaus retain the discretion to 
change the minimum acceptable bid amounts, the minimum acceptable bid 
percentage, the bid increment percentage, and the number of acceptable 
bid amounts if the Bureaus determine that circumstances so dictate. 
Further, the Bureaus retain the discretion to do so on a construction 
permit-by-construction permit basis. The Bureaus also retain the 
discretion to limit (a) the amount by which a minimum acceptable bid 
for a construction permit may increase compared with the corresponding 
provisionally winning bid, and (b) the amount by which an additional 
bid amount may increase compared with the immediately preceding 
acceptable bid amount. For example, the Bureaus could set a $10,000 
limit on increases in minimum acceptable bid amounts over provisionally 
winning bids. Thus, if calculating a minimum acceptable bid using the 
minimum acceptable bid percentage results in a minimum acceptable bid 
amount that is $12,000 higher than the provisionally winning bid on a 
construction permit, the minimum acceptable bid amount would instead be 
capped at $10,000 above the provisionally winning bid. If the Bureaus 
exercise this discretion to retain the discretion to change bid amounts 
if they determine that circumstances so dictate, it will alert bidders 
by announcement in the FCC Auction System during the auction.
iv. Provisionally Winning Bids
    122. At the end of each bidding round, a provisionally winning bid 
will be determined based on the highest bid amount received for each 
construction permit. A provisionally winning bid will remain the 
provisionally winning bid until there is a higher bid on the same 
construction permit at the close of a subsequent round. Provisionally 
winning bids at the end of the auction become the winning bids. 
Provisionally winning bids count toward activity for purposes of the 
activity rule.
    123. The Bureaus will use a random number generator to select a 
single provisionally winning bid in the event of identical high bid 
amounts being submitted on a construction permit in a given round 
(i.e., tied bids). Specifically, the FCC Auction System will assign a 
random number to each bid upon submission. The tied bid with the 
highest random number wins the tiebreaker, and becomes the 
provisionally winning bid. Bidders, regardless of whether they hold a 
provisionally winning bid, can submit higher bids in subsequent rounds. 
However, if the auction were to end with no other bids being placed, 
the winning bidder would be the one that placed the provisionally 
winning bid.
v. Bidding
    124. All bidding will take place remotely either through the FCC 
Auction System or by telephonic bidding. There will be no on-site 
bidding during Auction 98. Telephonic bid assistants are required to 
use a script when entering bids placed by telephone. Telephonic bidders 
must allow sufficient time to bid by placing their calls well in 
advance of the close of a round. The length of a call to place a 
telephonic bid may vary; please allow a minimum of ten minutes.
    125. A bidder's ability to bid on specific construction permits is 
determined by two factors: (1) the construction permits selected on the 
bidder's FCC Form 175 and (2) the bidder's eligibility. The bid 
submission screens will allow bidders to submit bids on only those 
construction permits the bidder selected on its FCC Form 175.
    126. In order to access the bidding function of the FCC Auction 
System, bidders must be logged in during the bidding round using the 
passcode generated by the SecurID[supreg] token and a personal 
identification number (PIN) created by the bidder. Bidders are strongly 
encouraged to print a round summary for each round after they have 
completed all of their activity for that round.
    127. In each round, an eligible bidder will be able to place bids 
on a given construction permit in any of up to nine pre-defined bid 
amounts if the bidder has sufficient eligibility to place a bid on the 
particular construction permit. For each construction permit, the FCC 
Auction System will list the acceptable bid amounts in a drop-down box.

[[Page 27585]]

Bidders use the drop-down box to select from among the acceptable bid 
amounts. The FCC Auction System also includes an upload function that 
allows text files containing bid information to be uploaded.
    128. Until a bid has been placed on a construction permit, the 
minimum acceptable bid amount for that permit will be equal to its 
minimum opening bid amount. Once there are bids on a permit, minimum 
acceptable bids for the following round will be determined.
    129. During a round, an eligible bidder may submit bids for as many 
construction permits as it wishes (providing that it is eligible to bid 
on the specific permits), remove bids placed in the current bidding 
round, or permanently reduce eligibility. If multiple bids are 
submitted for the same construction permit in the same round, the 
system takes the last bid entered as that bidder's bid for the round. 
Bidding units associated with construction permits for which the bidder 
has removed bids do not count towards current activity.
vi. Bid Removal and Bid Withdrawal
    130. In Auction 98, each bidder will have the option of removing 
any bids placed in a round provided that such bids are removed before 
the close of that bidding round. By using the remove bids function in 
the FCC Auction System, a bidder may effectively unsubmit any bid 
placed within that round. A bidder removing a bid placed in the same 
round is not subject to withdrawal payments. Removing a bid will affect 
a bidder's activity because a removed bid no longer counts toward 
bidding activity for the round. Once a round closes, a bidder may no 
longer remove a bid.
    131. In Auction 98, the Bureaus will prohibit bidders from 
withdrawing any bids after the round in which the bids were placed has 
closed. Bidders are cautioned to select bid amounts carefully because 
no bid withdrawals will be allowed, even if a bid was mistakenly or 
erroneously made.
vii. Round Results
    132. Reports reflecting bidders' identities for Auction 98 will be 
available before and during the auction. Thus, bidders will know in 
advance of this auction the identities of the bidders against which 
they are bidding.
    133. Bids placed during a round will not be made public until the 
conclusion of that round. After a round closes, the Bureaus will 
compile reports of all bids placed, current provisionally winning bids, 
new minimum acceptable bid amounts for the following round, whether the 
construction permit is FCC held, and bidder eligibility status (bidding 
eligibility and activity rule waivers), and will post the reports for 
public access.
viii. Auction Announcements
    134. The Commission will use auction announcements to report 
necessary information such as schedule changes. All auction 
announcements will be available by clicking a link in the FCC Auction 
System.

V. Post-Auction Procedures

    135. Shortly after bidding has ended, the Commission will issue a 
public notice declaring the auction closed, identifying the winning 
bidders, and establishing the deadlines for submitting down payments, 
final payments, and the long-form applications (FCC Forms 301).

A. Down Payments

    136. Within ten business days after release of the auction closing 
public notice, each winning bidder must submit sufficient funds (in 
addition to its upfront payment) to bring its total amount of money on 
deposit with the Commission for Auction 98 to twenty percent of the net 
amount of its winning bids (gross bids less any applicable new entrant 
bidding credits).

B. Final Payments

    137. Each winning bidder will be required to submit the balance of 
the net amount of its winning bids within ten business days after the 
applicable deadline for submitting down payments.

C. Long-Form Application (FCC Form 301)

    138. The Commission's rules currently provide that within thirty 
days following the close of bidding and notification to the winning 
bidders, unless a longer period is specified by public notice, winning 
bidders must electronically submit a properly-completed long-form 
application (FCC Form 301, Application for Construction Permit for 
Commercial Broadcast Station), and required exhibits for each 
construction permit won through Auction 98. Winning bidders claiming 
new entrant status must include an exhibit demonstrating their 
eligibility for the bidding credit. 47 CFR 1.2107(c) requires that a 
winning bidder for a commercial broadcast station submit an application 
filing fee with its post-auction long-form application. Further 
instructions on these and other filing requirements will be provided to 
winning bidders in the auction closing public notice.

D. Default and Disqualification

    139. Any winning bidder that defaults or is disqualified after the 
close of the auction (i.e., fails to remit the required down payment 
within the prescribed period of time, fails to submit a timely long-
form application, fails to make full payment, or is otherwise 
disqualified) will be subject to the payments described in 47 CFR 
1.2104(g)(2). This default payment consists of a deficiency payment, 
equal to the difference between the amount of the Auction 98 bidder's 
winning bid and the amount of the winning bid the next time a 
construction permit covering the same allotment is won in an auction, 
plus an additional payment equal to a percentage of the defaulter's bid 
or of the subsequent winning bid, whichever is less. The percentage of 
the applicable bid to be assessed as an additional payment for defaults 
in Auction 98 was established at twenty percent of the applicable bid.
    140. Finally, in the event of a default, the Commission has the 
discretion to re-auction the construction permit or offer it to the 
next highest bidder (in descending order) at its final bid amount. In 
addition, if a default or disqualification involves gross misconduct, 
misrepresentation, or bad faith by an applicant, the Commission may 
declare the applicant and its principals ineligible to bid in future 
auctions, and may take any other action that it deems necessary, 
including institution of proceedings to revoke any existing 
authorizations held by the applicant.

VI. Procedural Matters

    141. Paperwork Reduction Act Analysis. This document contains no 
new or modified information collection requirements subject to the 
Paperwork Reduction Act of 1995, Public Law 104-13. Therefore, it does 
not contain any new or modified information collection burden for small 
business concerns with fewer than 25 employees, pursuant to the Small 
Business Paperwork Relief Act of 2002, Public Law 107-198, 44 U.S.C. 
3506(c)(4).
    142. Congressional Review Act. Consistent with the requirements of 
the Congressional Review Act, 5 U.S.C. 801(a)(1)(A), the Commission 
will send a copy of the Auction 98 Procedures Announcement to Congress 
and the Government Accountability Office.
    143. Supplemental Regulatory Flexibility Analysis. Consistent with 
the Regulatory Flexibility Act of 1980, as amended (RFA), as well as 
the Commission's obligations to small businesses under sections 
309(j)(3)(B)

[[Page 27586]]

and 309(j)(4)(D) of the Communications Act of 1934, as amended, the 
Auction 98 Request for Comment included an additional analysis to 
supplement the Commission's Initial and Final Regulatory Flexibility 
analyses completed in the underlying notices of proposed rulemaking and 
rulemaking orders, including the Broadcast First Report and Order and 
associated orders which are hereby incorporated by reference. The 
Commission sought written public comment on the proposals in the 
Auction 98 Request for Comment, including comment on the supplemental 
analysis. None of the filed comments directly responded to the 
supplemental analysis in the Auction 98 Request for Comment. This 
supplemental analysis conforms to the RFA.
    144. Need for, and Objectives of, the Proposed Competitive Bidding 
Procedures. The Commission has established a framework of competitive 
bidding rules pursuant to which it has conducted auctions since the 
inception of the auction program in 1994 and will conduct Auction 98. 
The Commission has directed the Bureaus, under delegated authority, to 
promulgate the procedures, terms, and conditions of Commission auctions 
after seeking comment on a variety of auction-specific procedures prior 
to the start of each auction. The Auction 98 Procedures Announcement 
establishes the procedures and minimum opening bid amounts for the 
upcoming auction of certain FM broadcast construction permits. As 
stated in the Auction 98 Request for Comment, this process is intended 
to implement the Commission's duty under section 309(j)(3)(e)(i) of the 
Communications Act of 1934, as amended, to provide notice and adequate 
time for potential applicants, including small businesses, to comment 
on some proposed auction procedures. The Bureaus received four 
comments, with none directly addressing the Supplemental Regulatory 
Flexibility Analysis (SRFA) in the Auction 98 Request for Comment. The 
objective of the Auction 98 Procedures Announcement is to provide an 
overview of, and guidance on compliance with, the procedures, terms, 
and conditions governing Auction 98 and the post-auction application 
and payment processes for all potential Auction 98 participants, 
including small businesses.
    145. Under the procedures adopted to govern the conduct of Auction 
98, each auction applicant must submit electronically through the FCC 
Auction System a complete, accurate and timely FCC Form 175, submit a 
timely and sufficient upfront payment, and use the FCC Auction System 
to place any bids. Auction 98 will be conducted using a simultaneous 
multiple-round auction format. Each bidder must place bids within 
bidding eligibility and activity requirements using minimum acceptable 
bid amounts and bid increments, and subject to bid removal procedures 
and a simultaneous stopping rule. In addition, any winning bidder that 
defaults or is disqualified after the auction must submit an additional 
default payment of 20 percent of the applicable bid under 47 CFR 
1.2104(g)(2).
    146. Summary of Significant Issues Raised by Public Comments in 
Response to the SRFA. There were no comments directly addressing the 
supplemental analysis in the Auction 98 Request for Comment, and thus 
specific alternative procedures were not raised for consideration by 
the Bureaus. Nonetheless, the Bureaus carefully considered the 
potential impact of the auction procedures proposed in the SRFA on all 
potential participants, including small entities.
    147. Description and Estimate of the Number of Small Entities to 
which Specified Auction 98 Procedures Will Apply. The RFA directs 
agencies to provide a description of and, where feasible, an estimate 
of the number of small entities that may be affected by rules proposed 
in that rulemaking proceeding, if adopted. The RFA generally defines 
the term small entity as having the same meaning as the terms small 
business, small organization, and small governmental jurisdiction. In 
addition, the term small business has the same meaning as the term 
small business concern under the Small Business Act. A small business 
concern is one which: (1) Is independently owned and operated; (2) is 
not dominant in its field of operation; and (3) satisfies any 
additional criteria established by the Small Business Administration 
(SBA). Moreover, the SBA has created a small business size standard of 
$38.5 million or less in annual receipts for establishments primarily 
engaged in broadcasting aural programs. The size data provided by the 
SBA, however, does not enable the Bureaus to make a meaningful estimate 
of the number of small entities who may apply to participate in Auction 
98.
    148. The procedures, terms, and conditions governing Auction 98 in 
the Auction 98 Procedures Announcement will affect directly all 
applicants participating in Auction 98, including small businesses. The 
number of entities which may apply to participate in Auction 98 is 
unknown. However, the procedures, terms, and conditions described in 
this Public Notice will affect the same individuals and entities set 
forth in paragraphs 51 through 53 of the supplemental analysis 
undertaken in the Auction 98 Request for Comment. In that Request for 
Comment, the Bureaus estimated that the number of applicants for 
Auction 98 may range from approximately 175 to 260 based on the numbers 
of applicants who filed short-form applications to participate in 
previous auctions of FM radio station construction permits (exclusive 
of closed auctions). However, the Bureaus also recognized that the 
number of auction applicants in Auction 98 could vary significantly as 
an applicant's decision to participate at auction may be affected by 
factors outside of the Commission's knowledge or control.
    149. The Bureaus are unable to accurately ascertain the estimated 
number of small businesses that will participate in the Auction 98 
based on the participation in previous auctions because the information 
collected does not correlate to a bidding credit based on businesses 
size (as is the case in auctions of licenses for wireless services). 
However, recent estimates by the Bureaus are instructive. The Bureaus 
recently estimated that 97 percent of radio broadcasters met the SBA's 
prior definition of small business concern, based on annual revenues of 
$7 million. Moreover, the SBA has since increased that revenue 
threshold to $38.5 million. Based on this assessment, the Bureaus 
conclude that nearly all of Auction 98 applicants will likely meet the 
SBA's definition of a small business concern.
    150. Description of Projected Reporting, Recordkeeping, and Other 
Compliance Requirements. The Bureaus do not propose to implement any 
new reporting requirements, recordkeeping requirements or any other 
compliance requirements in this proceeding. Any individual or entity 
seeking to participate in an auction must submit electronically a 
short-form application (FCC Form 175). Additionally, if an applicant 
applies for a New Entrant Bidding Credit, the Commission uses 
information collected on its FCC Form 175 to determine whether the 
applicant is eligible for the Bidding Credit. If an applicant is a 
winning bidder, it is required to submit a more detailed long-form 
application (such as an FCC Form 301 for an FM station), including any 
additional information to demonstrate its eligibility for any bidding 
credit it may have claimed.
    151. Steps Taken to Minimize Significant Economic Impact on Small 
Entities, and Significant Alternatives Considered. The RFA requires an

[[Page 27587]]

agency to describe any significant alternatives beneficial to small 
entities considered in reaching a proposed approach, which may include 
the following four alternatives (among others): (1) Establishment of 
differing compliance or reporting requirements or timetables that take 
into account the resources available to small entities; (2) 
clarification, consolidation, or simplification for small entities of 
compliance and reporting requirements; (3) use of performance, rather 
than design, standards; and (4) an exemption for small entities.
    152. In the Auction 98 Procedures Announcement, the Bureaus 
describe the procedures, terms, and conditions governing Auction 98 and 
the post-auction process, which are summarized above in this 
supplemental analysis. Throughout the auction process the Bureaus 
remain mindful of the Commission's statutory obligations to ensure that 
small businesses, rural telephone companies, and businesses owned by 
members of minority groups and women are given the opportunity to 
participate in the provision of spectrum-based services. The statute 
also directs the Commission to promote economic opportunity and 
competition by avoiding excessive concentration of licenses and by 
disseminating licenses among a wide variety of applicants, including 
small businesses.
    153. Since the inception of the auction program in 1994, the 
Bureaus have taken steps to minimize the administrative burdens for 
applicants throughout the auction process while providing small 
businesses with the opportunity to participate in the provisioning of 
spectrum-based services. In Auction 98, these steps include, but are 
not limited to: (1) Administration of a two-phase application process 
to minimize reporting and compliance requirements as well as to 
expedite the auction process, which in turn minimizes administrative 
costs for all applicants, including small businesses; (2) establishment 
of an Auctions Web site, CDBS, and other online resources containing 
guidance for prospective applicants available at no charge for auction 
applicants to conduct research concerning construction permits, auction 
mechanics, and Commission decisions and regulations; (3) operation of a 
Web-based, interactive online tutorial and a mock auction online at no 
charge to facilitate applicant familiarization of the auction software 
and procedures; (4) conduct of bidding for Auction 98 electronically 
over the Internet, including online availability of round results and 
auction announcements; (5) availability of Commission staff to answer 
technical, legal, and other auction-related questions; and (6) a 
procedure for expedited return of an applicant's upfront payment by 
providing an online capability to request a refund before the close of 
the auction.
    154. The Bureaus also notes that most of the Auction 98 rules would 
apply to all entities that choose to participate in FM broadcast 
auctions. However, based on the Bureaus' experience, applying the same 
rules equally in this context provides consistency and predictability 
to the auction process, and minimizes administrative burdens for all 
auction participants, including small businesses. For instance, the 
Bureaus will issue several further public notices prior to and after 
Auction 98 that seek to, among other things, clarify short-form 
application requirements and to clearly articulate the applicable 
procedures, Commission rules, and Federal statutes, in order to 
facilitate compliance by all applicants, including small businesses.
    155. The Auction 98 process is designed to support the 
participation of small businesses. For instance, the Bureaus will 
publish public notices at key points of the auction process to keep 
applicants informed of auctions requirements and relevant deadlines. 
The Auction 98 Procedures Announcement provides detailed guidance on 
how a small business can participate at auction and to ensure 
compliance with the Commission's competitive bidding rules. After the 
short-form application filing deadline, the Bureaus will inform 
applicants as to whether their short-form applications are complete, 
timely, and accurate, and will provide applicants with an opportunity 
to correct minor application deficiencies. About two weeks prior to the 
beginning of bidding in Auction 98, the Bureaus will announce the 
identities of those applicants that are qualified to bid in Auction 98. 
The timeline from the announcement of Auction 98 to the execution of 
Auction 98, including the publication of public notices, is designed to 
lower costs and burdens of compliance with the Commission's competitive 
bidding rules for all applicants, including small businesses.
    156. Auction 98 will offer a New Entrant Bidding Credit for 
qualified entities, many of which may be small businesses. The New 
Entrant Biding Credit provides a qualifying new entrant with a 
percentage discount on auction winning bids and is designed to promote 
new entrant participation in the auction and the provision of FM 
broadcast service. Although the New Entrant Bidding Credit does not 
specifically target small businesses the Bureaus estimate that the 
majority of Auction 98 applicants will be small businesses.
    157. Once Auction 98 bidding has closed, the Bureaus will continue 
to provide information and services to auction applicants to facilitate 
compliance with their competitive bidding and media rules in the form 
of an additional public notice and continued support by Commission 
staff. At the conclusion of Auction 98, the Bureaus will release a 
public notice declaring the auction closed, identifying winning 
bidders, and establishing deadlines for submitting down payments, final 
payments and long-form applications, as well as posting on the Auction 
Web site the auction results which will include the auction's winning 
bidders and winning bid amounts. In summary, a number of procedures 
which will be implemented in Auction 98 facilitate auction 
participation by all interested prospective FM applicants, including 
small entities.
    158. Federal Rules that May Duplicate, Overlap, or Conflict with 
the Procedures for which Comment was Solicited in the Auction 98 
Request for Comment. None. These procedures for the conduct of Auction 
98 constitute more specific implementation of the competitive bidding 
rules contemplated by Parts 1 and 73 of the Commission's rules and the 
foregoing orders, including the Broadcast First Report and Order and 
associated orders, and are fully consistent therewith.
    159. Notice to Small Business Administration. The Bureaus will send 
a copy of the Auction 98 Procedures Announcement, including this 
supplemental analysis, to the Chief Counsel for Advocacy of the Small 
Business Administration. A summary of the Auction 98 Procedures 
Announcement, including this supplemental analysis, will also be 
published in the Federal Register.

    Federal Communications Commission.
Gary D. Michaels,
Deputy Chief, Auctions and Spectrum Access Division, WTB.
[FR Doc. 2015-11653 Filed 5-13-15; 8:45 am]
BILLING CODE 6712-01-P