[Federal Register Volume 84, Number 63 (Tuesday, April 2, 2019)]
[Proposed Rules]
[Pages 12566-12569]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-06348]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 1

[WT Docket No. 19-38, FCC 19-22]


Partitioning, Disaggregation, and Leasing of Spectrum

AGENCY: Federal Communications Commission.

ACTION: Proposed rule.

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SUMMARY: In this document, the Federal Communications Commission 
explores how potential changes to partitioning, disaggregation, and 
leasing rules might close the digital divide and to increase spectrum 
access by small and rural carriers. The document also satisfies the 
requirement under the Making Opportunities for Broadband Investment and 
Limiting Excessive and Needless Obstacles to Wireless Act (MOBILE

[[Page 12567]]

NOW Act),\1\ which requires that the Commission initiate a rulemaking 
to consider specific questions related to the partitioning or 
disaggregation of spectrum licenses and spectrum leasing as a potential 
means to increase availability of advanced telecommunications services 
in rural areas and spectrum access by small carriers.
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    \1\ MOBILE NOW Act, Public Law 115-141, Division P, Title VI, 
Sec.  601 et seq. (2018). The MOBILE NOW Act became law on March 23, 
2018.

DATES: Interested parties may file comments on or before May 2, 2019, 
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and reply comments on or before June 3, 2019.

ADDRESSES: You may submit comments, identified by WT Docket No. 19-38, 
by any of the following methods:
     Electronic Filers: Comments may be filed electronically 
using the internet by accessing the Commission's Electronic Comment 
Filing System (ECFS): http://fjallfoss.fcc.gov/ecfs2/. See Electronic 
Filing of Documents in Rulemaking Proceedings, 63 FR 24121 (1998).
     Paper Filers: Parties who choose to file by paper must 
file an original and one copy of each filing. Generally if more than 
one docket or rulemaking number appears in the caption of this 
proceeding, filers must submit two additional copies for each 
additional docket or rulemaking number. Commenters are only required to 
file copies in GN Docket No. 13-111.
     Filings can be sent by hand or messenger delivery, by 
commercial overnight courier, or by first-class or overnight U.S. 
Postal Service mail. All filings must be addressed to the Commission's 
Secretary, Office of the Secretary, Federal Communications Commission.
    [cir] All hand-delivered or messenger-delivered paper filings for 
the Commission's Secretary must be delivered to FCC Headquarters at 445 
12th St. SW, Room TW-A325, Washington, DC 20554. The filing hours are 
8:00 a.m. to 7:00 p.m. All hand deliveries must be held together with 
rubber bands or fasteners. Any envelopes and boxes must be disposed of 
before entering the building.
    [cir] Commercial overnight mail (other than U.S. Postal Service 
Express Mail and Priority Mail) must be sent to 9300 East Hampton 
Drive, Capitol Heights, MD 20743.
    [cir] U.S. Postal Service first-class, Express, and Priority mail 
must be addressed to 445 12th Street SW, Washington, DC 20554.
    People with Disabilities: To request materials in accessible 
formats for people with disabilities (Braille, large print, electronic 
files, audio format), send an email to [email protected] or call the 
Consumer & Governmental Affairs Bureau at 202-418-0530 (voice), 202-
418-0432 (TTY).

FOR FURTHER INFORMATION CONTACT: Anna Gentry, [email protected], of 
the Wireless Telecommunications Bureau, Mobility Division, (202) 418-
2887. For additional information concerning the PRA information 
collection requirements contained in this document, contact Cathy 
Williams at (202) 418-2918 or send an email to [email protected].

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Notice 
of Proposed Rulemaking (NPRM) in WT Docket No. 19-38, FCC 19-22, 
released on March 15, 2019. The complete text of the NPRM is available 
for viewing via the Commission's ECFS website by entering the docket 
number, WT Docket No. 19-38. The complete text of the NPRM is also 
available for public inspection and copying from 8:00 a.m. to 4:30 p.m. 
Eastern Time (ET) Monday through Thursday or from 8:00 a.m. to 11:30 
a.m. ET on Fridays in the FCC Reference Information Center, 445 12th 
Street SW, Room CY-B402, Washington, DC 20554, telephone 202-488-5300, 
fax 202-488-5563.
    This proceeding shall continue to be treated as a ``permit-but-
disclose'' proceeding in accordance with the Commission's ex parte 
rules (47 CFR 1.1200 et seq.). Persons making ex parte presentations 
must file a copy of any written presentation or a memorandum 
summarizing any oral presentation within two business days after the 
presentation (unless a different deadline applicable to the Sunshine 
period applies). Persons making oral ex parte presentations are 
reminded that memoranda summarizing the presentation must (1) list all 
persons attending or otherwise participating in the meeting at which 
the ex parte presentation was made, and (2) summarize all data 
presented and arguments made during the presentation. If the 
presentation consisted in whole or in part of the presentation of data 
or arguments already reflected in the presenter's written comments, 
memoranda or other filings in the proceeding, the presenter may provide 
citations to such data or arguments in his or her prior comments, 
memoranda, or other filings (specifying the relevant page and/or 
paragraph numbers where such data or arguments can be found) in lieu of 
summarizing them in the memorandum. Documents shown or given to 
Commission staff during ex parte meetings are deemed to be written ex 
parte presentations and must be filed consistent with rule 1.1206(b). 
In proceedings governed by rule 1.49(f) or for which the Commission has 
made available a method of electronic filing, written ex parte 
presentations and memoranda summarizing oral ex parte presentations, 
and all attachments thereto, must be filed through the electronic 
comment filing system available for that proceeding, and must be filed 
in their native format (e.g., .doc, .xml, .ppt, searchable .pdf). 
Participants in this proceeding should familiarize themselves with the 
Commission's ex parte rules.

I. Notice of Proposed Rulemaking

    Rulemaking Requirement. Section 616 of the MOBILE NOW Act requires 
that, within a year of its enactment, the Commission must ``initiate a 
rulemaking proceeding to assess whether to establish a program, or 
modify existing programs, under which a licensee that receives a 
license for exclusive use of spectrum in a specific geographic area 
under Section 301 of the Communications Act of 1934 (47 U.S.C. 301) may 
partition or disaggregate the license by sale or long-term lease.'' \2\ 
The purpose of any such new or modified program for partitioning and 
disaggregation would be to provide services consistent with the license 
and make unused spectrum available to ``(I) an unaffiliated small 
carrier; or (II) an unaffiliated carrier to serve a rural area.'' \3\ 
Section 616 conditions the adoption of a new or modified program on the 
Commission making a finding that it would ``promote (i) the 
availability of advanced telecommunications services in rural areas; or 
(ii) spectrum availability for covered small carriers.'' \4\
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    \2\ Id. Sec.  616(b)(1).
    \3\ Id. Sec.  616(b)(1)(A).
    \4\ Id. Sec.  616(b)(1)(B).
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    Considerations. Section 616 requires the Commission to consider 
four key questions in conducting the rulemaking. First, the Commission 
must examine whether reduced performance requirements with respect to 
the spectrum obtained through the program would facilitate deployment 
of advanced wireless services in rural areas.\5\ Second, the rulemaking 
must explore what conditions may be needed on transfers of spectrum 
under the program to allow covered small carriers to build out spectrum 
obtained under the program in a reasonable period of

[[Page 12568]]

time.\6\ Third, the Commission must consider whether certain incentives 
may be appropriate to encourage licensees to lease or sell spectrum, 
including (i) extending the term of a license; or (ii) modifying the 
performance requirements of the license relating to the leased or sold 
spectrum.\7\ Section 616 provides, however, that the Commission may 
offer incentives or reduced performance requirements only if it finds 
that doing so would be likely to result in increased availability of 
advanced telecommunications services in a rural area.\8\ Additionally, 
if a party fails to meet any buildout requirements set by the 
Commission for any spectrum sold or leased under a new or modified 
partitioning and disaggregation program, ``the right to the spectrum 
shall be forfeited to the Commission unless the Commission finds that 
there is good cause for the failure of the party.'' \9\ Finally, the 
Commission must evaluate the administrative feasibility of those or any 
other incentives the Commission might consider that further the goals 
of the rulemaking requirement.\10\
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    \5\ Id. Sec.  616(b)(2)(A).
    \6\ MOBILE NOW Act, Sec.  616(b)(2)(B).
    \7\ Id. Sec.  616(b)(2)(C).
    \8\ Id. Sec.  616(b)(3).
    \9\ Id. Sec.  616(b)(3).
    \10\ Id. Sec.  616(b)(2)(D).
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    Definitions. In establishing its dual goals of making spectrum 
available to small carriers and promoting the availability of advanced 
telecommunications services in rural areas, Section 616 defines two key 
terms. First, the term ``covered small carrier'' is defined as a 
carrier \11\ that ``(A) has not more than 1,500 employees (as 
determined under section 121.106 of title 13, Code of Federal 
Regulations, or any successor thereto); and (B) offers services using 
the facilities of the carrier.''\12\ Second, Section 616 defines the 
term ``rural area'' as any area other than ``(A) a city, town, or 
incorporated area that has a population of more than 20,000 
inhabitants; or (B) any urbanized area contiguous and adjacent to a 
city or town that has a population of more than 50,000 
inhabitants.''\13\ As a result, these definitions will apply to any use 
of the terms ``covered small carrier'' or ``rural area'' in this NPRM, 
notwithstanding any definitions of these terms in other Commission 
proceedings that may differ from those described by Section 616.\14\
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    \11\ Section 616 directs the Commission to use the definition of 
``carrier'' contained in section 3 of the Communications Act of 
1934, which defines a carrier as ``any person engaged as a common 
carrier for hire, in interstate or foreign communication by wire or 
radio or interstate or foreign radio transmission of energy . . . 
but a person engaged in radio broadcasting shall not, insofar as 
such person is so engaged, be deemed a common carrier.'' 47 U.S.C. 
153 (11).
    \12\ MOBILE NOW Act, Sec.  616(a)(1).
    \13\ Id. Sec.  616(a)(2).
    \14\ For example, in many proceedings, the Commission has 
defined a ``rural'' county or census block as one with a population 
density of less than 100 people per square mile. See, e.g., 
Facilitating the Provision of Spectrum-Based Services to Rural Areas 
and Promoting Opportunities for Rural Telephone Companies To Provide 
Spectrum-Based Services, Report and Order and Further Notice of 
Proposed Rulemaking, 19 FCC Rcd 19078, 19086-88, paragraphs. 10 
through12 (2004).
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    The Commission's existing partitioning, disaggregation, and leasing 
rules are designed to facilitate spectrum access and encourage 
secondary market transactions that will lead to efficient use of 
spectrum. The NPRM seeks comment on whether to establish a program, or 
modify existing programs, for the partitioning, disaggregation, and 
leasing of licenses. The NPRM also seeks comment on what, if any, 
changes would promote the availability of advanced telecommunications 
services in rural areas or spectrum availability for covered small 
carriers--such as allowing additional time to meet performance 
obligations under certain circumstances. The NPRM also asks commenters 
to address three considerations set forth in Section 616, including 
addressing the administrative feasibility of each consideration; they 
are: (1) Whether reduced performance requirements applicable to 
partitioned or disaggregated licenses would promote the availability of 
advanced telecommunications services in rural areas or spectrum 
availability for covered small carriers; (2) what conditions may be 
needed to eliminate impediments to transfers of spectrum to covered 
small carriers to allow them to build out in a reasonable period of 
time; and (3) what incentives may encourage licensees to lease or sell 
spectrum to covered small carriers or unaffiliated carriers that will 
serve rural areas. The NPRM seeks to develop a record on the success of 
the Commission's existing rules and therefore seek comment on whether 
further Commission action would likely promote the availability of 
advanced telecommunications services in rural areas and facilitate 
access to spectrum by covered small carriers.
    Reduced Performance Requirements in Rural Areas. The NPRM seeks 
comment on whether reduced performance requirements for partitioned or 
disaggregated licenses would facilitate the deployment of advanced 
telecommunications services in rural areas. The Commission's rules 
permit parties to a partition or disaggregation to agree either to 
share the responsibility for meeting performance requirements or to 
satisfy the requirements individually. The NPRM seeks comment on 
potential modifications to these requirements that may be likely to 
increase service to rural areas, and on how to ensure that reduced 
performance requirements do not lead to reduced service in rural areas. 
The NPRM seeks comment on, for example, extending by one year a 
receiving party's construction deadline for a partitioned or 
disaggregated license when (i) the receiving party is a rural carrier 
or is acquiring spectrum that includes ``rural areas,'' as defined by 
Section 616, and (ii) the receiving party elects to meet the 
construction requirement independently for its partitioned or 
disaggregated license area. The NPRM seeks comment on various aspects 
of implementing such an approach, or any other approach that commenters 
advocate.
    The NPRM asks commenters advocating for these specific approaches, 
or for other approaches involving reduced performance requirements, to 
discuss how they would be implemented, including how and when they 
would take effect, to whom they would apply, and any specific 
conditions that should apply. Commenters should also describe in detail 
how any such implementation would serve to promote the availability of 
advanced telecommunications services in rural areas. Further, in light 
of Section 616's requirement that the Commission consider the 
administrative feasibility of implementing reduced performance 
requirements, commenters should discuss the costs and benefits of any 
proposed implementation.
    Conditions on Transfers of Spectrum to Covered Small Carriers. As a 
threshold matter, the MOBILE NOW Act directs the Commission to focus on 
programs that would promote spectrum availability for ``covered small 
carriers,'' a term that encompasses only common carriers.\15\ While the 
NPRM seeks comment below on issues relating to ``covered small 
carriers,'' as required, the Commission also seeks comment on whether 
it should consider applying any rule revisions to an expanded class of 
licensees beyond those Congress requires the Commission to consider. 
The NPRM also seeks comment on what conditions may be needed on 
transfers of spectrum to allow covered small carriers to build out in a 
reasonable period. The NPRM asks whether there are procedural barriers 
to partitioning or disaggregation that limit the utility of those 
programs for covered small carriers, and if so, the nature of those 
barriers and the types of entities that are

[[Page 12569]]

currently foreclosed. In addition to procedural barriers to 
partitioning and disaggregation, the NPRM seeks comment on whether 
there are substantive barriers with respect to covered small carriers' 
ability to satisfy performance requirements applicable to the 
partitioned or disaggregated spectrum, and whether reduced construction 
obligations or extended performance deadlines could increase the number 
of covered small carriers that are willing and able to obtain spectrum 
through partitioning, disaggregation, or lease arrangements.
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    \15\ See 47 U.S.C. 153(11).
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    The NPRM seeks comment on these and any other relevant 
considerations regarding special conditions for covered small carriers 
that obtain access to spectrum through partition or disaggregation. 
Commenters should discuss in detail both the necessity and the 
likelihood of any such conditions resulting in increased spectrum 
availability for covered small carriers. Further, in light of the 
Section 616 requirement that the Commission consider the administrative 
feasibility of special conditions for covered small carriers, 
commenters should also discuss the costs and benefits of any conditions 
they advocate.
    Incentives to Encourage Lease or Sale. The NPRM seeks comment on 
what, if any, incentives might be appropriate to encourage licensees to 
lease or sell spectrum to covered small carriers or unaffiliated 
carriers that will serve rural areas, including license term extensions 
or modified performance requirements. The NPRM seeks comment on whether 
the Commission's existing secondary markets rules are sufficiently 
flexible to provide adequate incentives for licensees to sell or lease 
their spectrum rights to covered small carriers or unaffiliated 
carriers that seek to provide service to rural areas. The NPRM asks 
commenters to discuss the effectiveness of existing benefits of sale or 
lease, and whether further incentives would be likely to encourage 
licensees to lease or sell spectrum. For example, the NPRM seeks 
comment on whether and how modified performance requirements or longer 
license terms might encourage more licensees to sell or lease their 
spectrum rights. The Commission asks commenters to discuss the 
incremental benefits of increasing the number of spectrum sales or 
leases relative to the potential collateral effects that such 
incentives may have. For example, while reduced buildout requirements 
may increase the number of licensees willing to lease spectrum, it may 
also decrease deployment of advanced wireless services in those license 
areas as a result of the reduced performance requirements. The NPRM 
therefore seeks comment on the specific costs and benefits of any 
incentives that commenters advocate and the relative weight the 
Commission should apply in evaluating whether those incentives would be 
likely to result in increased availability of advanced 
telecommunications services in rural areas.
    The NPRM also seeks comment on whether allowing spectrum 
``reaggregation'' for spectrum that has been partitioned or 
disaggregated on the secondary market--up to the size of the original 
market area--would increase the incentives of parties to lease or sell 
spectrum in the first place, and thus ultimately meet the dual goals of 
increasing the availability of advanced telecommunications services in 
rural areas and facilitating access to spectrum by covered small 
carriers. Under the Commission's current rules, while licensees may 
partition and disaggregate their licenses through spectrum 
transactions, there is no provision for reaggregating spectrum, even 
when the partitioned or disaggregated portions of an original market 
area are acquired by a single entity. Holding multiple licenses for 
what was once a single license may impose certain regulatory and 
administrative burdens on licensees, including construction 
requirements, renewal showings, continuous service requirements, and 
the need to maintain up-to-date information in ULS. In the context of 
other proceedings, some parties have asked the Commission to allow 
reaggregation of spectrum to ease these burdens.\16\ The NPRM seeks 
comment on the relationship between reducing these burdens and 
incentivizing spectrum transactions.
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    \16\ See, e.g., Sprint Comments, WT Docket No. 10-112, at 19-20 
(filed Aug. 6, 2010); AT&T Reply Comments, WT Docket No. 10-112, at 
12 (filed Aug. 23, 2010).
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    If commenters advocate for incentives such as modified performance 
requirements, longer license terms, spectrum reaggregation, or another 
incentive, the Commission directs them to describe in detail how the 
incentive would likely increase the availability of advanced 
telecommunications services in rural areas or facilitate access to 
spectrum by covered small carriers. Further, in light of the Section 
616 requirement that the Commission consider the administrative 
feasibility of providing incentives to lease or sell spectrum, 
commenters should also discuss the costs and benefits of any incentives 
they advocate.

II. Procedural Matters

Initial Regulatory Flexibility Act Analysis

    As required by the Regulatory Flexibility Act of 1980 (RFA), the 
Commission has prepared an Initial Regulatory Flexibility Analysis 
(IRFA) of the possible significant economic impact on small entities of 
the policies and rules proposed in this document. We request written 
public comment on the IRFA. Comments must be filed in accordance with 
the same deadlines as comments filed in response to the NPRM as set 
forth on the first page of this document, and have a separate and 
distinct heading designating them as responses to the IRFA. The 
Commission's Consumer and Governmental Affairs Bureau, Reference 
Information Center, will send a copy of the NPRM, including the IRFA, 
to the Chief Counsel for Advocacy of the Small Business Administration.

Initial Paperwork Reduction Act Analysis

    The NPRM contains proposed new information collection requirements. 
The Commission, as part of its continuing effort to reduce paperwork 
burdens, invites the general public and OMB to comment on the 
information collection requirements contained in this document, as 
required by PRA. In addition, pursuant to the Small Business Paperwork 
Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4), the 
Commission seeks specific comment on how it might ``further reduce the 
information collection burden for small business concerns with fewer 
than 25 employees.''

Federal Communications Commission.
Katura Jackson,
Federal Register Liaison Officer, Office of the Secretary.
[FR Doc. 2019-06348 Filed 4-1-19; 8:45 am]
 BILLING CODE 6712-01-P