Future of Spectrum (U.S. Senate Committee on Commerce, Science, and Transportation, Subcommittee on Communications, Media, and Broadband)

Hearing	Future of Spectrum
Committee	U.S. Senate Committee on Commerce, Science, and Transportation, Subcommittee on Communications, Media, and Broadband
Date	August 2, 2022

 

Hearing Takeaways:

• The U.S. Federal Communications Commission’s (FCC) Expiring Spectrum Auction Authority: The hearing largely focused on the impending expiration of the FCC’s authority to conduct spectrum auctions. Absent Congressional action, this authority is currently set to expire on September 30, 2022. There was widespread support for extending this authority from both Subcommittee Members and the hearing’s witnesses. They discussed how these auctions had raised more than $230 billion for the U.S. government since 1993, had funded many federal telecommunications programs, and had supported the U.S.’s deployment of wireless technologies. They warned that a lapse in this authority could create uncertainty for the U.S. wireless industry and hamper the U.S.’s deployment of wireless technologies, which would ultimately harm the U.S.’s global competitiveness. They further warned that a lapsed in authority could harm spectrum auctions currently in progress (such as the 2.5 GHz band auction).
  • Impact on the U.S.’s Spectrum Pipeline: Subcommittee Member and the hearing’s witnesses discussed how Congress routinely used extensions of the FCC’s spectrum auction authority to direct the FCC to auction off certain bands of spectrum. Ms. Baker asserted that this Congressional direction was critical for ensuring the completion of the spectrum auctions. Subcommittee Member and the hearing’s witnesses noted how the U.S.’s spectrum pipeline would be empty following the completion of the 2.5 GHz band auction and stated that the reauthorization could help to replenish this pipeline.
  • Duration of the Extension Under Consideration: A key area of debate involved how long Congress should extend the FCC’s spectrum auction authority. Most Subcommittee Members, Ms. Baker, and Dr. Bazelon expressed support for an 18-month extension of the authority (as was recently approved in the U.S. House of Representatives). They contended that this approach would provide both policymakers and stakeholders with sufficient time to develop a longer-term extension of the authority that would direct the FCC to auction off specific specific bands of spectrum. Mr. Lewis raised concerns however that an 18-month extension was too short and would prevent the FCC and the U.S. National Telecommunications and Information Administration (NTIA) from engaging in longer-term spectrum policy planning. He advocated for a longer-term extension of the authority.
  • Use of Revenues Raised from Spectrum Auctions: Subcommittee Members and the hearing’s witnesses highlighted how the monies raised by the FCC’s spectrum auctions were and could be used to support various federal telecommunications programs focused on bolstering public safety and supporting underserved communities. These programs include the First Responder Network Authority (FirstNet), Next Generation 911 (NG911), the FCC’s Rip-and-Replace program, and the FCC’s Emergency Connectivity Fund (ECF).
  • Impact on Infrastructure Investment and Jobs Act (IIJA) Investments: Sen. Jacky Rosen (D-NV) expressed concerns that a lapse in the FCC’s spectrum auction authority would impact the implementation of the IIJA’s broadband infrastructure programs. Ms. Baker, Mr. Lewis, and Dr. Bazelon asserted that a lapse in the FCC’s spectrum auction authority would harm the wireless sector’s development and the rollout of IIJA broadband infrastructure programs.
• Federal Agency Coordination on Spectrum Policy Issues: Subcommittee Members and the hearing’s witnesses expressed concerns that communications breakdowns between the FCC, the NTIA, and other federal agencies were undermining the U.S.’s spectrum management system. Under this system, the FCC makes spectrum reallocation decisions and the NTIA represents the interest of federal agencies in these proceedings. Subcommittee Members and the hearing’s witnesses raised concerns that communications breakdowns led federal agencies to distrust the process and attempt to circumvent it. They called for improved coordination on spectrum policy matters between the FCC, the NTIA, and federal agencies.
  • NTIA Representation of Federal Agencies in Spectrum Reallocation Proceedings: Mr. Von Ah discussed the U.S. Government Accountability Office’s (GAO) recommendations for the NTIA to better advocate on behalf of federal agencies during spectrum reallocation proceedings. He testified that the GAO had found the NTIA lacked a documented process in place to plan its reallocation efforts from start to finish. He commented that this led some federal agencies to believe that their views were not adequately represented in some instances, which led the federal agencies to bypass the NTIA on spectrum policy matters. He stated that documented procedures could provide clarity on several points, including the level of technical detail that agencies should be submitting to the NTIA and the reasons for why an agency’s comments are or are not incorporated in the NTIA’s final submission to the FCC.
  • Status of the NTIA Administrator Position: Ms. Baker recommended that the NTIA Administrator be elevated to the Under Secretary level at the U.S. Department of Commerce. She commented that this action would bolster the Administrator’s credibility when negotiating with other federal agencies. Subcommittee Chairman Ben Ray Luján (D-NM) expressed his receptiveness to the recommendation.
  • Use of the U.S. Institute for Telecommunications Services (ITS) to Resolve Disputes: Ms. Baker noted that many of the U.S.’s spectrum management problems were technical in nature. She expressed support for increasing the ITS’s funding and commented that the ITS could provide neutral technical input for spectrum policy disputes.
  • New Memorandum of Understanding (MOU) Between the FCC and the NTIA on Spectrum Coordination: Subcommittee Members and the hearing’s witnesses applauded the FCC and the NTIA for their new a MOU on spectrum coordination. They noted that this MOU would provide a structure for resolving conflicts between the agencies on spectrum policy and reaffirm the roles of the federal agencies in managing the U.S.’s spectrum resources. Mr. Von Ah stated that this MOU was aligned with the GAO’s recommendations and called the MOU “a good first step” for the agencies.
  • Federal Inventory of Spectrum: Sen. Marsha Blackburn (R-TN) called for the establishment of an inventory of all the spectrum held by federal agencies. Mr. Von Ah noted that the NTIA did maintain an inventory of federal spectrum uses in a government master file. He acknowledged however that this master file might lack certain information, such as where the spectrum was being used and the time at which the spectrum was being used.
  • Impact on U.S. Participation in International Bodies: Sen. Jerry Moran (R-KS) expressed interest in ensuring the U.S.’s leadership at international standard setting bodies, including the International Telecommunication Union (ITU). He expressed concerns that an absence of leadership at these bodies left space for adversarial nations to set the standards that would underpin future communications technology. Mr. Von Ah and Ms. Baker stated that conflicts amongst federal agencies had often undermined the U.S.’s credibility within international forums and contended that improving interagency coordination would help to bolster the U.S.’s participation in these forums.
• Efficient Spectrum Use: Subcommittee Members, Mr. Lewis, and Dr. Bazelon all remarked that the U.S. must promote more efficient spectrum use in response to the growing demand for spectrum. They indicated that this would entail striking an appropriate balance between licensed and unlicensed spectrum use. They noted that the U.S. had few spectrum greenfield opportunities, which will make new infrastructure, spectrum reallocations, and spectrum sharing increasingly important. Dr. Bazelon further asserted that policymakers needed to account for the fact that new and emerging technologies will likely have different spectrum demand profiles.
  • Impact of the U.S. Congressional Budget Office (CBO) Scoring Process on Spectrum Allocations: Dr. Bazelon remarked that budget rules played a key role in influencing spectrum policy and discussed how policymakers often focused on CBO scores when considering federal spectrum auction legislation. He noted that CBO scores did not estimate the value of the spectrum, the expected bids for the spectrum, or the net benefits of the spectrum auction to society. He indicated that CBO scores merely estimated the net effects of a proposed spectrum auction on the federal budget. He stated that while budget scoring rules could create an incentive for legislation to facilitate spectrum reallocations that might not otherwise happen, he asserted that budget rules alone did not constitute a sufficient substitute for thoughtful and deliberate spectrum management.
• Additional Policy Issues: Subcommittee Members and the hearing’s witnesses used the hearing to address additional policy issues related to spectrum policy and broadband internet deployment.
  • Improving Broadband Internet Access for Tribes: Subcommittee Chairman Ben Ray Luján (D-NM), Mr. Lewis, and Mr. Von Ah all expressed interest in ensuring that Tribes were provided with sufficient opportunities to participate in the FCC’s spectrum auctions and to deploy broadband internet. They highlighted the important role that the FCC’s Tribal Window Program played in providing spectrum auction participation opportunities for Tribes. Mr. Von Ah noted how the GAO had recommended that the Executive Office of the President include a Tribal focus in a national broadband strategy. He also highlighted how the GAO had recommended that the NTIA’s Office of Internet Connectivity and Growth (OICG) be cognizant of Tribal issues in their interactions with other federal agencies.
  • Use of Spectrum for Precision Agriculture: Sen. Amy Klobuchar (D-MN) mentioned how she had previously introduced the Precision Agriculture Connectivity Act, which sought to identify gaps in broadband coverage and encourage broadband deployment on farms and ranches. She stated that this broadband coverage and deployment would help farmers to manage water levels. Mr. Lewis noted how farmers were already making use of the Citizens Broadband Radio Service (CBRS) band and WiFi to support their precision agriculture activities.
  • Proposed Minimum Corporate Tax’s Impact on Spectrum Holdings: Subcommittee Republicans and Ms. Baker expressed concerns that a proposed 15 percent tax on book income would harm spectrum license holders. Ms. Baker remarked that the tax on book income currently under consideration would slow the U.S.’s build out of 5G infrastructure, exacerbate broadband access disparities, undermine the U.S.’s global competitiveness, and reduce the U.S.’s spectrum pipeline. Subcommittee Chairman Luján stated however that that this proposed tax would only impact companies with $1 billion in profit, which was a very small minority of spectrum license holders.
  • The U.S.’s Wireless Workforce: Sen. Jacky Rosen (D-NV) highlighted how the wireless communications industry relied upon highly skilled workers to run and maintain its broadband networks. She raised concerns that this workforce was aging and expressed particular interest in efforts to diversify the U.S.’s wireless workforce. Mr. Lewis stated that the U.S. could influence spectrum auction winners to use vendors that adhered to certain standards. He also remarked that the U.S. must design spectrum auctions in a manner that would allow for small women- and minority-owned businesses to participate. He suggested that smaller licensed areas and bidding credits could support this objective. 
  • Net Neutrality: Sen. Ed Markey (D-MA) and Mr. Lewis called for the adoption of net neutrality policies and contended that these policies were key to guarding against discrimination from broadband providers.

Hearing Witnesses:

1. Mr. Chris Lewis, President and CEO, Public Knowledge
2. Ms. Meredith Baker, President and CEO, CTIA
3. Mr. Andrew Von Ah, Director of Physical Infrastructure, U.S. Government Accountability Office
4. Dr. Coleman Bazelon, Principal, The Brattle Group

Member Opening Statements:

Subcommittee Chairman Ben Ray Luján (D-NM):

• He discussed how licensed and unlicensed spectrum served as the foundation for the U.S.’s broadband network.
  • He highlighted how the broadband network supported communications, education, telehealth, national security, natural disaster recovery efforts, and scientific research.
• He stated that the hearing would consider various challenges related to spectrum management, including commercial licensing, intergovernmental conflicts over spectrum claims, and technical and engineering challenges.
  • He noted how many uses of spectrum lacked a clear market value and asserted that it was difficult to precisely quantify the benefits that spectrum provides in terms of national security, public safety, and scientific research.
• He then discussed how spectrum was one of the few policy areas under the Committee’s jurisdiction that generated revenue and mentioned how spectrum auctions had raised over $230 billion for the U.S. government to date.
• He noted how the authority granted to the FCC to conduct spectrum auctions was set to expire on September 30, 2022.
• He remarked that Congress must act to ensure that spectrum use would best meet the public interest and specifically suggested that a portion of the revenues raised from spectrum auctions ought to be dedicated to updating the U.S.’s 911 systems and promoting digital equity.
  • He commented that structures and efforts like the CBRS and the FCC’s Tribal Priority Window have demonstrated that spectrum policy could promote competition and be tailored to meet the needs of rural areas.
• He applauded the U.S. House of Representatives for its recent passage of bipartisan legislation to extend the FCC’s spectrum auction authority.
  • He also noted how this legislation would also restore the NTIA as the lead agency for spectrum decisions.
• He mentioned how FCC Chairman Jessica Rosenworcel and NTIA Administrator Alan Davidson had just signed an updated MOU to structure how the FCC and the NTIA would resolve spectrum challenges.
  • He stated that this MOU reaffirmed the roles of the FCC and the NTIA in managing the U.S.’s spectrum resources.
  • He also stated that this MOU would promote better coordination between the agencies and emphasize evidence-based policymaking.

Full Committee Ranking Member Roger Wicker (R-MS):

• He called the hearing timely considering the impending expiration of the FCC’s spectrum auction authority and emphasized that spectrum was a critical component for enabling innovation in the U.S.’s wireless economy.
  • He highlighted how the provision of spectrum for commercial use had helped to support the development of new commercial technologies and applications for consumers.
• He discussed how there was increasing demand for spectrum from both the private sector and federal agencies and stated that the scarce nature of spectrum made effective spectrum management essential.
• He remarked that auctions had proven to be a “winning solution” for allocating spectrum frequencies and noted how these auctions had raised more than $230 billion for the U.S. government since their creation in 1993.
  • He indicated that the funding from these auctions had supported the creation of the FirstNet and reductions in the federal budget deficit.
• He reiterated that the FCC’s spectrum auction authority was soon set to expire and called on Congress to extend this authority.
  • He mentioned how the FCC had recently commenced a spectrum auction of the 2.5 GHz band and commented that the expiration of the FCC’s auction authority could jeopardize the completion of the auction.
• He largely attributed the success of FCC spectrum auctions to the fact that auction bidders had certainty that they would receive their spectrum licenses within a promised time frame.
  • He asserted that any action or inaction that reduces this certainty would risk depressing the value of spectrum.
• He stated that a short-term extension of the FCC’s auction authority would enable the Committee to continue working with stakeholders to develop legislation that would identify specific bands of spectrum to be made available for auction.
  • He commented that legislating which spectrum bands would be auctioned had proven to be a particularly successful approach and added that this approach would enable stakeholders to plan ahead.
• He then stated that Congress should look to the expert spectrum management agencies for guidance regarding the U.S.’s efforts to deploy 5G technology and successor technologies.
  • He indicated that these expert spectrum management agencies were the FCC and the NTIA.
• He contended that the FCC and the NTIA ought to make the U.S.’s spectrum policy decisions and commented that high profile spectrum policy disputes and disagreements would weaken the U.S.’s spectrum management system.
  • He further expressed interest in working to develop legislation to improve coordination and communication between federal agencies, the FCC, and the NTIA on spectrum management issues.

Subcommittee Ranking Member John Thune (R-SD):

• He discussed the important role that spectrum plays in terms of supporting next generation telecommunications networks and asserted that spectrum management was especially important in the global race to deploy these networks.
  • He stated that spectrum management was particularly important for rural states and commented that these states were more vulnerable to not receiving next generation telecommunications services.
• He then mentioned how the FCC had recently commenced its auction of the 2.5 GHz band and commented that this auction would support the deployment of 5G services to more rural and tribal areas.
• He called on Congress to provide a short-term extension of the FCC’s spectrum auction authority so that the U.S. could ensure the on-time completion of the current 2.5 GHz auction.
  • He also remarked that Congress should build upon the success of the Making Opportunities for Broadband Investment and Limiting Excessive and Needless Obstacles to Wireless (MOBILE NOW) Act and the Beat China by Harnessing Important, National Airwaves (CHINA) for 5G Act of 2020 through developing legislation to keep spectrum in the auction pipeline.
  • He further mentioned how he had introduced the bipartisan Spectrum Innovation Act of 2022, which would free up spectrum in the lower 3 GHz band for auction in mobile services.
• He stated that legislation to keep spectrum in the auction pipeline would provide regulatory certainty and predictability for stakeholders.
• He acknowledged that spectrum pipeline legislation would take time to develop and would require government agencies, industry, and other stakeholders to work together.
• He recounted how Congress had last extended the FCC’s general spectrum auction authority in 2012 and noted how Congress had provided the FCC with specific direction on the spectrum bands that should be considered for auction.
  • He commented that it had taken Congress several years to identify the spectrum bands that should be placed up for auction during this 2012 extension.
• He expressed hope that the Committee could work in a bipartisan manner to develop more comprehensive spectrum legislation.
• He then remarked that sound spectrum management would require proper coordination between the NTIA, the FCC, and other affected federal agencies.
  • He applauded the NTIA and the FCC for its recent agreement to update their spectrum coordination processes.
  • He also called on the Committee to advance the Improving Spectrum Coordination Act of 2021 to support these coordination efforts.
• He further stated that the Committee must recognize the important role that unlicensed spectrum plays in the communications landscape.
  • He explained that unlicensed spectrum was responsible for transmitting a significant amount of the data in existing networks and stated that unlicensed spectrum would play a significant role in the development of the internet of things (IoT).
• He lastly called on the Committee to remove barriers to large scale 5G deployment and mentioned how he had proposed the Streamlining the Rapid Evolution And Modernization of Leading-edge Infrastructure Necessary to Enhance (STREAMLINE) Small Cell Deployment Act to expedite the deployment of the small cells needed for 5G installation.
  • He commented that the STREAMLINE Small Cell Deployment Act would make it more affordable to bring 5G to rural areas.

Witness Opening Statements:

Mr. Chris Lewis (Public Knowledge):

• He proposed four guideposts for a national spectrum policy strategy that could drive innovation and promote quality access to communications.
• He indicated that the first guidepost was that the U.S. should center its national spectrum policy around public interest objectives set by Congress.
• He mentioned how Congress had directed the FCC to design spectrum auctions with safeguards to protect the public interest and to make robust communications services available for all Americans.
  • He noted how the FCC’s public interest objectives included the promotion of competition and economic opportunity, the prevention of excessive consolidation, the provision of opportunities for small businesses, and the serving of the public’s communications needs.
• He remarked that Congress, the FCC, and the NTIA needed to work to advance public interest objectives.
  • He commended the FCC for its recent modifications of spectrum licensing rules to increase spectrum access for small carriers and tribes.
  • He also suggested that Congress could further bolster tribal connectivity through mandating expanded use of the FCC’s Tribal Priority Windows in spectrum auctions and the use of CBRS-style spectrum sharing.
• He indicated that the second guidepost was that the U.S. must adopt a balanced approach for spectrum access models.
• He noted how the average number of connected devices per home had risen from 11 in 2019 to 25 in 2021.
  • He indicated that these devices included smart televisions, doorbells, and home appliances and highlighted how these devices mostly relied upon unlicensed spectrum.
  • He also mentioned how even licensed services were increasingly relying upon unlicensed technology to offload their data on their congested airwaves.
• He remarked that the demand for both licensed and unlicensed spectrum demonstrated the importance of using a mix of access regimes for meeting national connectivity demands.
• He stated however that there existed very few spectrum greenfield opportunities remaining and asserted that spectrum stakeholders must therefore work together to enhance efficiency.
  • He commented that the success of the CBRS as a sharing regime demonstrated how future spectrum band plans could create more opportunities for innovation and competition through a balance of shared licensed and unlicensed allocations.
• He indicated that the third guidepost was that the U.S. should commit to a long-term spectrum plan.
  • He applauded Congress, the Biden administration, and the Trump administration for giving wireless providers with sufficient access to spectrum for deploying “state of the art” 5G systems.
• He remarked that an 18-month extension of the FCC’s auction authority would limit the abilities of the FCC and the NTIA to engage in long-term spectrum planning.
• He contended that Congress should instead provide the FCC with a longer-term extension of its auction authority.
  • He commented that such an extension would support federal agencies and private stakeholders in developing thoughtful plans for spectrum commercialization.
• He also suggested that Congress consider directing the NTIA to issue a report that would identify potential bands for auction and address how these bands might be structured for commercial use.
• He indicated that the fourth guidepost was that the U.S. must prioritize public interest needs when spending the revenue generated from spectrum auctions.
• He stated that there were several national priorities in communications policy that private investment either would not or could not fund.
  • He highlighted the benefits of digital equity programs and asserted that a more sustainable source of funding would be needed to support these programs.
  • He expressed the support of his organization, Public Knowledge, for the Airwaves for Equity intuitive, which proposed to set aside spectrum auction revenues to fund digital inclusion efforts.

Ms. Meredith Baker (CTIA):

• She remarked that the U.S. could be the global leader in 5G technology and innovative industries through a national commitment to spectrum policy.
  • She stated that this global leadership would be built on greater licensed mid-band spectrum access.
• She discussed how 5G technology was currently being deployed in the U.S. at a rate that was almost twice as fast as the deployment of 4G technology.
• She stated that the deployment of 5G technology will drive $1.5 trillion more into the U.S. economy and create over 4 million new jobs.
  • She highlighted how 5G technology will lead to fewer cars, improved manufacturing processes, and better delivery of health care.
• She also contended that 5G technology would spur broadband competition and noted how the fastest growing home broadband company was a wireless provider.
  • She asserted that 5G home internet would play a key role in closing the U.S.’s digital divide.
• She remarked however that the U.S. had not yet fully deployed 5G technology and asserted that more spectrum would be needed to support these deployment efforts.
  • She discussed how the FCC’s spectrum auctions played a key role in supporting the U.S.’s 5G deployment efforts and noted how the U.S. had invested over $115 billion in new mid-band spectrum over the previous three years alone.
• She highlighted how the FCC’s authority to conduct spectrum auctions was set to expire very shortly and asserted that Congress must provide the FCC with the authority to hold future spectrum auctions.
  • She recommended that Congress package this extension of FCC spectrum auction authority with designated future spectrum auctions.
  • She highlighted how Congress’s last extension of FCC spectrum auction authority had explicitly directed the FCC to hold three separate auctions.
• She expressed support for the U.S. House of Representatives’s bipartisan approach to extend FCC spectrum auction authority for 18 months to provide stakeholders with sufficient time to provide input on the development of a new spectrum pipeline.
  • She mentioned how the current 2.5 GHz auction was the last defined auction and stated that the Committee was uniquely situated to propose the FCC’s next set of spectrum auctions.
• She then remarked that the U.S.’s approach to mid-band spectrum currently lacked balance and noted how the U.S. Government currently holds roughly two-thirds of this spectrum.
• She contended that maximizing the amount of commercial access in the 3 GHz, 4 GHz, and 7 GHz bands should be the U.S.’s immediate focus.
  • She expressed support for the Spectrum Innovation Act and commented that this legislation would immediately address spectrum access in the lower 3 GHz band.
• She stated that the identification of specific spectrum for auction would provide the Committee with the opportunity to fund key policy priorities, such as NG911 and the Rip-and-Replace program.
• She then remarked that the U.S. needed to empower the FCC and the NTIA to adjudicate spectrum matters and applauded the agencies for their work to enhance coordination and improve spectrum management.
• She further called on the Committee to address the impact of the proposed corporate minimum tax on spectrum.
  • She noted that this proposal would impose a 15 percent tax on spectrum holdings and asserted that this proposal could undermine spectrum development efforts.

Mr. Andrew Von Ah (U.S. Government Accountability Office):

• He discussed how both the FCC and the NTIA were responsible for regulating and managing the U.S.’s diverse uses of spectrum.
  • He explained that the FCC oversaw the commercial and non-federal use of spectrum and that the NTIA oversaw the federal use of spectrum.
• He noted how federal legislation to reauthorize the FCC’s spectrum auction authority was seeking to make 200 MHz of spectrum currently being used by federal agencies available for 5G mobile communications.
• He stated that NTIA must work with federal agencies to examine the suitability of spectrum bands for reallocations from federal use to non-federal use.
  • He discussed how the NTIA coordinated with the FCC and other affected federal agencies to examine the potential impact of a proposed reallocation.
• He noted how any spectrum reallocation might require existing users to end or modify their spectrum use, update or modify existing equipment, move their affected services to other bands, or accommodate sharing of the spectrum.
• He mentioned how the FCC and the NTIA had successfully reallocated and auctioned hundreds of MHz of spectrum across several bands.
  • He highlighted how some of the reallocations were highly complex and had taken many years to complete.
• He also stated that some spectrum reallocations could be very contentious in nature as they might impact the operations of several agencies or critical safety systems.
• He noted that his testimony before the Committee was based on two recent GAO reports on spectrum management activities.
  • He indicated that the first report looked at NTIA’s spectrum reallocation process and the extent to which the NTIA had developed a planning process to guide its efforts.
  • He indicated that the second report looked at the spectrum coordination activities of federal agencies and whether the FCC, the NTIA, and other federal agencies followed leading practices in their collaboration on potential spectrum interference issues.
• He testified that the GAO had found the NTIA lacked a documented process in place to plan its reallocation efforts from start to finish.
• He noted that the GAO had identified three practices for program management that could benefit the NTIA’s efforts.
  • He indicated that these practices included having a program management plan in place that was updated regularly, having a master schedule updated regularly, and conducting risk management throughout the life of the program.
• He stated that the absence of the aforementioned practices made it difficult for the NTIA and the stakeholders involved in spectrum reallocation efforts to be assured that they were fully prepared for the process.
  • He further stated that the absence of these practices provided the NTIA and stakeholders with no basis to judge whether reallocation work could have been performed faster and undermined their ability to respond to risks.
• He also mentioned how the GAO had found that the NTIA lacked documented procedures for effectively presenting Executive Branch views on spectrum-related matters to the FCC.
  • He commented that this dynamic often led some federal agencies to believe that their views were not adequately represented.
• He stated that documented procedures could provide clarity on several points, including the level of technical detail that agencies should be submitting to the NTIA and the reasons for why an agency’s comments are or are not incorporated in the final submission to the FCC.
• He then testified that the GAO had found that the collaboration mechanisms used by the FCC, the NTIA, and other federal agencies did not always meet leading collaboration practices.
  • He noted how both the Memorandum of Agreement (MOA) between the FCC and the NTIA and the General Guidance Document that guides general and other preparatory work for international proceedings lacked defined and agreed upon processes for resolving matters when agencies could not do so.
• He mentioned how the FCC and the NTIA had just announced an updated MOU that would address the aforementioned issues and had begun meeting regularly under their spectrum coordination initiative.
• He further noted how the GAO had found that the mechanisms of the FCC and the NTIA lacked agreed upon procedures for conducting and reviewing feasibility and potential interference studies.
  • He commented that this lack of agreed upon procedures had adversely impacted spectrum reallocation efforts involving the U.S. Federal Aviation Administration (FAA), the U.S. National Aeronautics and Space Administration (NASA), and the U.S. National Oceanic and Atmospheric Administration (NOAA).
• He testified that the GAO had made several recommendations to both the FCC and the NTIA to address the aforementioned issues and indicated that the two agencies had begun to implement the GAO’s recommendations.

Dr. Coleman Bazelon (The Brattle Group):

• He discussed how the FCC and the NTIA managed a fixed pool of spectrum and noted how these agencies must deal with incumbent spectrum users during spectrum reallocations.
• He remarked that spectrum allocations will become increasingly difficult, more expensive, and require more creativity moving forward.
  • He commented that new tools, such as incentive auctions and innovative sharing regimes, would be increasingly important in terms of meeting future spectrum needs.
• He stated that a band of spectrum should be made available for new uses when the value in the new use exceeded the cost of making the spectrum available.
• He remarked that a broad set of considerations ought to inform U.S. spectrum policy.
  • He highlighted how unlicensed spectrum uses created value for society in a way that did not create bidders with market demand for spectrum.
  • He mentioned that mobile broadband operators by contrast regularly bid billions of dollars for spectrum licenses.
  • He further commented that governmental uses of spectrum were difficult to value, which meant that primary goal of government users should be to use spectrum efficiently.
• He remarked that budget rules played a key role in influencing spectrum policy and commented that policymakers often focused on CBO scores when considering federal spectrum auction legislation.
  • He noted that CBO scores did not estimate the value of the spectrum, the expected bids for the spectrum, or the net benefits of the spectrum auction to society.
  • He indicated that CBO scores merely estimated the net effects of a proposed spectrum auction on the federal budget.
• He stated that while budget scoring rules could create an incentive for legislation to facilitate spectrum reallocations that might not otherwise happen, he asserted that budget rules alone did not constitute a sufficient substitute for thoughtful and deliberate spectrum management.
• He then remarked that the tools used to reallocate spectrum from lower value uses to higher value uses will change over the next decade.
  • He commented that the easier methods for spectrum reallocation have been exhausted and noted how demand for spectrum was continuing to grow.
• He predicted that the traditional clear and auction approach will become less attractive and that the net budgetary incentives for legislating spectrum auctions will likely decrease over time.
• He stated making existing bands available for new uses without having to clear all existing users first might help to avoid the largest of the clearing costs.
  • He commented that new spectrum sharing approaches could have high net benefits for users if such approaches could preserve user value.
• He remarked that Congress and the Executive Branch should work to foster cooperation between the FCC and the NTIA to engage in long-term spectrum policy planning.

Congressional Question Period:

Subcommittee Chairman Ben Ray Luján (D-NM):

• Chairman Luján discussed how many of his constituents relied upon wireless technologies to connect to critical services through broadband internet. He noted how the FCC’s ability to conduct spectrum auctions was set to expire in September 2022. He stated that Congress must ensure that the FCC would begin working on future spectrum auctions as part of its legislative efforts to extend the FCC’s spectrum auction authority. He commented that these efforts would involve having the FCC commence technical evaluations and negotiations with incumbent spectrum users. He asked Mr. Lewis to indicate whether a longer-term extension of the FCC’s spectrum auction authority would strengthen the ability of the FCC and the NTIA to make spectrum available for connecting all Americans to high-speed, reliable, and affordable broadband services.
  • Mr. Lewis responded affirmatively.
• Chairman Luján asked Mr. Lewis to explain how a longer reauthorization of the FCC’s spectrum auction authority would support the Committee’s mission to connect all Americans to high-speed, reliable, and affordable broadband services.
  • Mr. Lewis remarked that longer spectrum auction authorization periods would enable the FCC and the NTIA to better identify which spectrum bands ought to be made available and determine the guidelines for making these bands available. He stated that greenfield spectrum opportunities were decreasing, which necessitated the U.S. to be efficient and creative with its spectrum policy. He recommended that the U.S. consider spectrum sharing and a mix of licensed and unlicensed spectrum in response to these reduced opportunities. He commented that these strategies would entail significant planning from the FCC and the NTIA.
• Chairman Luján then stated that one of the most important current tasks for the FCC and the NTIA was the development of a national coordinated strategy on spectrum management. He commented that poor coordination between federal agencies could delay the construction of critical infrastructure. He asked Ms. Baker to indicate whether Congress should invest in bolstering the technical expertise at both the FCC and the NTIA.
  • Ms. Baker answered affirmatively.
• Chairman Luján expressed agreement with Ms. Baker. He then mentioned how the FCC and the NTIA had recently announced an updated MOU so that they could better coordinate their spectrum management efforts. He asked Mr. Von Ah to indicate whether the current law had clearly identified the FCC and the NTIA as leaders in managing and regulating the U.S.’s spectrum use.
  • Mr. Von Ah answered affirmatively.
• Chairman Luján highlighted how the GAO had made recommendations to the FCC and the NTIA and expressed interest in exploring these recommendations later during the hearing.

Subcommittee Ranking Member John Thune (R-SD):

• Ranking Member Thune noted how Congress had never allowed for the FCC’s spectrum auction authority to lapse. He asked Ms. Baker and Mr. Lewis to discuss the potential impact of having this auction authority lapse. He specifically asked Ms. Baker and Mr. Lewis to address whether lapsed spectrum auction authority would harm the U.S.’s ability to lead on the deployment of next generation telecommunications services.
  • Mr. Lewis remarked that having the FCC’s spectrum auction authority lapse would constitute the “worst case scenario.” He stated that such a lapse would signal that the U.S. was moving away from a regulatory structure that fostered competition and diverse spectrum uses. He called on Congress to provide a longer-term extension of the FCC’s spectrum auction authority to signal the U.S.’s intention to hold future spectrum auctions.
  • Ms. Baker remarked that having the FCC’s spectrum auction authority lapse would create uncertainty for stakeholders, which would hamper the U.S.’s deployment of 5G capabilities. She stated that these issues would ultimately impact the U.S.’s global competitiveness. She called for an 18-month extension of the FCC’s spectrum auction authority.
• Ranking Member Thune expressed support for a short-term extension of the FCC’s spectrum auction authority. He commented that a short-term extension would provide the Committee with sufficient time to develop a more comprehensive strategy to build out the U.S.’s spectrum pipeline. He asked Mr. Lewis to indicate whether he supported a short-term extension of the FCC’s spectrum auction authority.
  • Mr. Lewis expressed his preference for a longer-term or permanent extension of the FCC’s spectrum auction authority.
• Ranking Member Thune commented that while most Committee Members preferred a longer-term or permanent extension of the FCC’s spectrum auction authority, he stated that such an approach might not be viable at the present time. He then asked Ms. Baker to discuss how Congressional direction on which spectrum bands would be made available provided certainty to commercial entities.
  • Ms. Baker remarked that it was important for Congress to provide the FCC with direction on which spectrum bands to make available as part of any long-term extension of spectrum auction authority. She stated that this approach had proven to be effective and stated that future spectrum bands would be increasingly complex.to reallocate. She specifically called on Congress to direct the FCC to make available the lower 3 GHz band, the 4 GHz band, and the 7 GHz band. She noted how the U.S. government currently controlled two-thirds of the U.S.’s prime mid-band spectrum and commented that federal agencies tended to not be self-motivated to repurpose their spectrum. She asserted that federal legislation would therefore play a key role in spurring spectrum reallocations. She also noted how Congress could dictate where the proceeds of a spectrum auction went if they specified which bands would be put up for auction. She noted how spectrum auctions had raised $100 billion during the previous two years and indicated that none of these funds had gone towards Congressional priorities.
• Ranking Member Thune then mentioned how Congressional Democrats were currently working on a proposal that would tax book income. He noted how the U.S. Tax Code allowed for spectrum to be amortized. He asked Ms. Baker to project the impact that this proposed tax would have on wireless services providers.
  • Ms. Baker remarked that the tax on book income currently under consideration would slow the U.S.’s build out of 5G infrastructure, exacerbate broadband access disparities, undermine the U.S.’s global competitiveness, and reduce the U.S.’s spectrum pipeline. She asserted that spectrum ought to be treated the same as other infrastructure assets for the purposes of federal taxation.
• Ranking Member Thune commented that the Tax Cuts of Jobs Act of 2017 (TCJA) was intended to encourage companies to invest in new technologies. He asserted that the proposal to tax book income would therefore not constitute the closing of a “loophole” in the U.S. Tax Code. He then noted how there existed significant federal funding being made available to construct and deploy fixed and mobile networks. He asked Ms. Baker to indicate whether she supported efforts to streamline permitting requests to enable consumers to more quickly benefit from these wireless technologies.
  • Ms. Baker expressed support for Ranking Member Thune’s efforts to streamline permitting requests to build 5G networks.

Sen. Deb Fischer (R-NE):

• Sen. Fischer asked Ms. Baker to discuss how Congress’s failure to reauthorize the FCC’s spectrum auction authority would adversely impact U.S. taxpayers.
  • Ms. Baker remarked that the U.S. was still competing with other countries to deploy 5G technology. She noted how other countries had twice as much mid-band spectrum as the U.S. and explained that mid-band spectrum was where 5G capabilities were being built out. She stated that the U.S. needed to make more mid-band spectrum available to support these 5G technology deployment efforts. She remarked that the FCC needed to hold spectrum auctions in order to supply the U.S. with this necessary spectrum. She stated that the U.S.’s previous success in deploying 4G technology was responsible for the U.S.’s global technology leadership. She contended that U.S. leadership in 5G technology would enable the U.S. to continue its global technology leadership.
• Sen. Fischer then stated how recent spectrum conflicts had demonstrated a lack of trust in the NTIA’s Interdepartment Radio Advisory Committee (IRAC) process. She commented that this lack of trust led many federal agencies to bypass the NTIA on spectrum policy matters. She asked Mr. Von Ah to provide recommendations for strengthening the integrity of NTIA’s management of federal spectrum needs and rebuilding the trust of federal stakeholders.
  • Mr. Von Ah remarked that the recently announced MOU between the FCC and the NTIA would help to address many of the NTIA’s coordination and trust issues. He stated that the GAO had called on the NTIA to proactively communicate with other federal agencies. He commented that this communication would ensure that federal agencies would have sufficient opportunities to raise spectrum reallocation concerns during the NTIA’s IRAC process. He stated that the GAO had found that the FCC and the NTIA had previously failed to engage in robust coordination efforts on spectrum policy issues. He noted that the MOU would require the FCC and the NTIA to meet more frequently. He expressed optimism that this MOU would lead to increased coordination and trust between the two agencies.
• Sen. Fischer then expressed concerns with proposals to reallocate spectrum away from the U.S. Department of Defense (DoD) and suggested that such reallocations might reduce the U.S.’s ability to respond to foreign military threats. She asked Mr. Von Ah to address how the U.S. could ensure that it continued to prioritize its security in spectrum reallocation discussions.
  • Mr. Von Ah called the MOU between the FCC and the NTIA a “good first step” and expressed the GAO’s interest in monitoring the MoU’s implementation. He also noted how the GAO had recommended that the NTIA better explain to other federal agencies how it worked to represent the views of the agencies before the FCC. He commented that such explanations would foster more confidence in spectrum reallocation decisions.

Sen. Jacky Rosen (D-NV):

• Sen. Rosen discussed how the IIJA contained various investments in broadband infrastructure. She commented that these investments had the potential to eliminate the U.S.’s broadband access disparities. She asked the witnesses to project how a lapse in the FCC’s spectrum auction authority would impact the implementation of the IIJA’s broadband infrastructure programs.
  • Ms. Baker noted how wireless broadband service had two main components: infrastructure and spectrum. She remarked that the FCC’s inability to provide additional spectrum would therefore limit the build out of broadband infrastructure. She stated that extending the FCC’s spectrum auction authority would be key for deploying fixed mobile services and highlighted how 5G technology could help to connect rural and unserved areas to broadband internet.
  • Mr. Von Ah commented that the GAO had not considered how a lapse in the FCC’s spectrum auction authority would impact the implementation of the IIJA’s broadband infrastructure programs.
  • Mr. Lewis commented that while a lapse in the FCC’s spectrum auction authority would not have a direct impact on the implementation of the IIJA’s broadband infrastructure programs, he stated that such a lapse would have a complimentary effect on broadband infrastructure programs. He elaborated that access to spectrum was a necessary condition for rural broadband deployment.
  • Dr. Bazelon remarked that spectrum auction authority was an integral part of the U.S.’s spectrum management strategy. He asserted that a lapse in the FCC’s spectrum auction authority would harm the wireless sector’s development and the rollout of IIJA broadband infrastructure programs.
• Sen. Rosen then discussed how the wireless communications industry relied upon highly skilled workers to run and maintain its broadband networks. She raised concerns that this workforce was aging and commented that the U.S. lacked enough younger workers that could fill these job vacancies. She noted how Mr. Lewis had suggested that the FCC could design its auctions in a way that encouraged greater participation of underrepresented communities in the wireless communications industry. She asked Mr. Lewis to discuss the impact that U.S. spectrum policy could have on hiring, retaining, and training workers in the wireless communications industry. She expressed particular interest in efforts to diversify the U.S.’s wireless workforce.
  • Mr. Lewis remarked that U.S. spectrum policy could impact both the wireless workforce and the ownership of spectrum. He stated that the U.S. could influence spectrum auction winners to use vendors that adhered to certain standards. He also remarked that the U.S. must design spectrum auctions in a manner that would allow for small women- and minority-owned businesses to participate. He suggested that smaller license areas and bidding credits could support this objective. He also applauded FCC Chairman Jessica Rosenworcel for reinstating the FCC’s Advisory Committee on Diversity and Digital Empowerment and commented that this Committee could develop additional tactics to promote diversity within the spectrum space.

Sen. Marsha Blackburn (R-TN):

• Sen. Blackburn remarked that there needed to exist an inventory of all the spectrum held by federal agencies. She asked Ms. Baker to address why Congress needs to create such an inventory as part of its efforts to extend the FCC’s spectrum auction authority. She specifically asked Ms. Baker to discuss how this inventory would be useful to policymakers in their deployment of 5G technology.
  • Ms. Baker remarked that the next spectrum that the U.S. allocates ought to be mid-band spectrum and noted how two-thirds of the mid-band spectrum was U.S. government spectrum. She stated that an inventory of the U.S. government’s spectrum would be very helpful for assessing whether existing federal agency spectrum was being used efficiently and for informing spectrum reallocation decisions.
• Sen. Blackburn then noted how there had recently occurred conflicts over spectrum involving the FCC, the NTIA, the DoD, the FAA, and the U.S. Department of Transportation. She asked Mr. Von Ah to provide recommendations for minimizing these conflicts. She also asked Mr. Von Ah to address how an inventory of all of the spectrum held by federal agencies would help to reduce these conflicts.
  • Mr. Von Ah first noted that the NTIA did maintain an inventory of federal spectrum uses in a government master file. He mentioned how the most recent National Defense Authorization Act (NDAA) had required the GAO to review and consider updates to the maintenance of this master file. He acknowledged however that this master file might lack certain information, such as where the spectrum was being used and the time at which the spectrum was being used. He commented that this missing information could be useful for reallocating spectrum in certain circumstances or identifying opportunities for spectrum sharing. He then remarked that increased coordination amongst federal agencies could help to prevent interagency spectrum conflicts. He specifically recommended that the NTIA proactively engage federal agencies during spectrum reallocation processes to identify potential areas of conflict. He applauded the recent MOU between the FCC and the NTIA and commented that this MOU would support interagency coordination on spectrum matters.
• Sen. Blackburn stated that many federal agencies had unused spectrum and commented that this spectrum could be shared. She then expressed interest in how the CBO scoring process could impact the upcoming reauthorization of the FCC’s spectrum auction authority. She asked Mr. Bazelon to identify the benefits and drawbacks of an 18-month reauthorization of the FCC’s spectrum auction authority.
  • Dr. Bazelon remarked that an 18-month reauthorization of the FCC’s spectrum auction authority could be useful. He commented however that there was broad agreement that the FCC ought to be permitted to conduct spectrum auctions for a long time. He stated that Congress could always direct spectrum reallocations as part of standalone bills. He noted however that these standalone bills would have lower CBO scores than more comprehensive bills that included reauthorizations of the FCC’s spectrum auction authority.

Sen. Amy Klobuchar (D-MN):

• Sen. Klobuchar mentioned how she was a co-chair of the Next Generation 911 Caucus and noted how an estimated 240 million calls were made to 911 centers annually. She expressed concerns that 911 centers often relied upon outdated technology and noted how some places did not allow for people to access 911 centers via text messages. She mentioned how she had introduced legislation to modernize the U.S.’s 911 systems to accommodate text messages, pictures, videos, and other information sent by smartphones. She asked Mr. Lewis to indicate whether the U.S.’s 911 infrastructure was in “dire” need of modernization.
  • Mr. Lewis answered affirmatively. He stated that modernizing the U.S.’s 911 infrastructure should be considered a public interest objective that was worthy of the funds raised from spectrum auctions.
• Sen. Klobuchar also noted how Ms. Baker’s testimony had highlighted the benefits of 5G technology in terms of improving the U.S.’s public safety. She asked Ms. Baker to discuss how 5G and other technologies could be leveraged to advance public communications.
  • Ms. Baker first thanked Sen. Klobuchar for her leadership on 911 issues. She then noted that Congress had complete discretion over how money raised by the FCC’s spectrum auctions would be spent. She commented that the use of this money for 911 modernization constituted a worthy cause. She mentioned how the U.S. had previously used spectrum auctions to fund the creation of FirstNet.
• Sen. Klobuchar then mentioned how she had previously introduced the Precision Agriculture Connectivity Act, which sought to identify gaps in broadband coverage and encourage broadband deployment on farms and ranches. She stated that this broadband coverage and deployment would help farmers to manage water levels. She asked Mr. Lewis to discuss how the U.S. could ensure that farmers had access to modern broadband capabilities. She also asked Mr. Lewis to address the role that broadband internet played in supporting precision agriculture.
  • Mr. Lewis remarked that spectrum policy could play an important role in promoting precision agriculture in rural areas. He noted how farmers were already making use of the CBRS band and WiFi to support their precision agriculture activities. He stated that the U.S. should set up future spectrum auctions that would allow for the sharing of licensed and unlicensed spectrum. He commented that these sharing capabilities were important considering the U.S.’s lack of greenfield spectrum.
• Sen. Klobuchar lastly asked Dr. Bazelon to discuss how new spectrum sharing techniques could help to deliver more consistent broadband service for consumers.
  • Dr. Bazelon remarked that more creatively designed incentive auctions and database-managed sharing systems would enable spectrum to be used more efficiently.

Sen. Jerry Moran (R-KS):

• Sen. Moran expressed support for extending the FCC’s spectrum auction authority for 18 months. He also remarked that Congress should have a role in determining which bands of spectrum would be put up for auction and how the proceeds of these auctions would be spent. He then stated that reallocated spectrum was not always deployed smoothly and commented that this issue was present with the recent C-band 5G deployment delay. He noted how the GAO had found there to be inadequate coordination between the FCC and the NTIA on spectrum reallocation issues. He asked Mr. Von Ah to address whether the GAO’s recommendations had accounted for the recent challenges related to the C-Band 5G deployment. He also asked Mr. Von Ah to provide recommendations for improving federal agency coordination so that these types of issues did not arise moving forward.
  • Mr. Von Ah remarked that the GAO’s recommendations were applicable to the recent challenges related to the C-Band 5G deployment. He noted how the FAA had failed to express their concerns regarding this spectrum reallocation early on in the reallocation process. He stated that more and earlier coordination between the FCC and the NTIA would enable the NTIA to better express the concerns of federal agencies in FCC spectrum reallocation proceedings.
• Sen. Moran then mentioned how he had sponsored an amendment in the United States Innovation and Competition Act of 2021 (USICA) that sought to ensure the U.S.’s leadership at international standard setting bodies, including the ITU. He expressed concerns that an absence of leadership at these bodies left space for adversarial nations to set international technology standards. He indicated that his amendment was ultimately included as part of the recently passed Creating Helpful Incentives to Produce Semiconductors (CHIPS) and Science Act of 2022. He asked Mr. Von Ah to elaborate on how the federal government’s lack of coordination on spectrum matters was harming the U.S. at international standards bodies. He also asked Mr. Von Ah to provide recommendations for Congress for ensuring U.S. leadership at international standards bodies.
  • Mr. Von Ah noted how the GAO had studied the negotiations surrounding the 24 GHz band. He stated that there was no technical basis for the U.S.’s positions at the international proceeding regarding this band. He commented that this lack of a technical basis had undermined the U.S.’s position in this proceeding. He mentioned how the GAO had recommended that other federal agencies also improve their coordination processes when working with the FCC and the NTIA. He also mentioned how the GAO had recommended that the FCC and the NTIA update the General Guidance Document, which governs international proceedings.
• Sen. Moran asked Mr. Von Ah to indicate whether the GAO’s aforementioned recommendations were being followed.
  • Mr. Von Ah stated that the General Guidance Document had not yet been updated. He indicated however that the FCC and the NTIA had recently developed an MOU.
• Sen. Moran asked Mr. Von Ah to discuss the importance of having the U.S. play a leadership role in international standards setting bodies.
  • Mr. Von Ah commented that the GAO was ill-suited to opine on this topic.
  • Ms. Baker remarked that the NTIA ought to serve as the final arbiter on spectrum policy decisions. She stated that the status quo allowed for different federal agencies to take conflicting positions on spectrum policy matters, which undermined the U.S.’s credibility in international forums.
• Sen. Moran mentioned how he served on the Subcommittee of the U.S. Senate Committee on Appropriations that had jurisdiction over the NTIA. He expressed interest in using the Congressional appropriations process to improve the NTIA’s operations.

Sen. Ed Markey (D-MA):

• Sen. Markey asked Mr. Lewis to discuss how recent technological changes were making more spectrum available.
  • Mr. Lewis remarked that recent technological changes were making more spectrum available and allowing for the more efficient use of spectrum. He stated that many of the recent agency conflicts surrounding spectrum could have been resolved through early planning and engagement. He also asserted that improved equipment standards could have helped to resolve these conflicts. He remarked that a longer-term reauthorization of the FCC’s spectrum auction authority could signal Congress’s desire for proactive stakeholder coordination on spectrum matters.
• Sen. Markey also discussed the importance of unlicensed spectrum use and stated that Congress must ensure access to this unlicensed use. He then highlighted how spectrum auctions raised “significant” amounts of money. He noted how the COVID-19 pandemic had exposed the fact that between 12 million and 17 million children lacked access to home broadband internet services. He mentioned how he had led the effort to establish the FCC’s ECF to provide broadband internet services for these children. He noted however that the ECF was beginning to run out of money. He asked Mr. Lewis to discuss whether some of the revenues raised from spectrum auctions ought to be dedicated to supporting a permanent ECF.
  • Mr. Lewis thanked Sen. Markey for his work on the ECF and stated that there existed several sources of funding that could support the ECF. He suggested that some of the spectrum auction funds dedicated to digital equity initiatives could be set aside to support the ECF. He also stated that Congress could always appropriate more funds to the ECF.
• Sen. Markey contended that the ECF should receive a portion of the revenues raised from the FCC’s spectrum auctions. He then asked Mr. Lewis to discuss the importance of net neutrality for ensuring that the U.S. had a competitive marketplace.
  • Mr. Lewis remarked that net neutrality was important for preventing harmful discrimination from the broadband providers. He noted that while broadband providers had committed to adhering to the principles of net neutrality, he stated that there were several examples of these broadband providers not adhering to these principles. He contended that Congress ought to empower the FCC to issue net neutrality rules.
• Sen. Markey remarked that net neutrality was key to preventing internet discrimination and expressed his support for the adoption of net neutrality policies.

Sen. Shelley Moore Capito (R-WV):

• Sen. Capito noted how the Tax Foundation had estimated that imposing a 15 percent minimum tax on book income will increase the tax liability for spectrum license owners by $7.2 billion over 10 years. She expressed concerns that this tax increase will limit companies in deploying 5G technology, which will exacerbate broadband access disparities. She asked Ms. Baker to indicate whether enacting the 15 percent minimum tax on book income will raise taxes on spectrum license holders, which will in turn lead to higher consumer prices.
  • Ms. Baker answered affirmatively. She expressed CITA’s hope that Congress would amend the tax proposals under development so that spectrum auction holdings would be considered the same as other infrastructure holdings.
• Sen. Capito asked Ms. Baker to confirm that a 15 percent minimum tax on book income would raise taxes for spectrum license owners.
  • Ms. Baker confirmed that such a tax would raise taxes for spectrum license owners. She also noted how this policy would impose retroactive taxes on spectrum license owners through forcing them to pay new taxes on their existing holdings. She commented that these new taxes will harm the deployment of broadband internet and exacerbate broadband access disparities. She further stated that companies will need to account for these new taxes when determining their bids for future spectrum auctions.
• Sen. Capito then mentioned how the IIJA had made “significant” investments in broadband internet, which were leading more Americans to access this internet. She asked Ms. Baker to address how Congress could ensure that the U.S. had sufficient spectrum for both consumers and businesses to fully utilize broadband networks.
  • Ms. Baker expressed appreciation for the Committee’s work on the IIJA and for the Committee’s focus on making the IIJA technology neutral. She stated that CITA was working with states to promote the use of wireless technologies (including 5G home broadband) in their implementation of the IIJA. She commented that these wireless technologies would enable states to more efficiently connect underserved areas to broadband internet.
• Sen. Capito asked the witnesses to address whether the U.S. possessed sufficient spectrum to handle the expected increase in demand for broadband services. She also asked the witnesses to indicate whether this spectrum would be robust enough for the more difficult areas to reach.
  • Dr. Bazelon noted how spectrum in rural areas tended to be less constrained because there were few spectrum users in these areas. He stated that the main challenge of deploying spectrum in rural areas was that it was often not economical to deploy spectrum to these areas.
• Sen. Capito interjected to ask Dr. Bazelon to indicate whether these challenges were attributable to affordability, a lack of customers, and other related issues.
  • Dr. Bazelon stated that infrastructure deployment was needed to ensure that rural Americans would have sufficient access to broadband internet services. He also stated that companies required certainty that rural customers could afford broadband internet in order to justify broadband infrastructure deployment expenditures. He suggested that consumer-side subsidies could foster this certainty.
  • Mr. Von Ah expressed agreement with Dr. Bazelon’s response. He also discussed how there was great demands for spectrum, which underscored the importance of sound spectrum management. 
  • Ms. Baker expressed agreement with the previous responses. She also remarked that the U.S. needed to make more spectrum available. She commented that while the current 2.5 GHz band auction was very important, she noted that this auction constituted the end of the U.S.’s spectrum pipeline. She called on Congress to extend the FCC’s spectrum auction authority.
  • Mr. Lewis remarked that the U.S.’s spectrum policy ought to encourage the efficient and timely use of spectrum. He stated that the FCC should allow for the sharing or partitioning of spectrum that was not being used.

Sen. John Hickenlooper (D-CO):

• Sen. Hickenlooper mentioned how the ITS was located in his state of Colorado and called it the premier research laboratory for spectrum issues. He indicated that the ITS was currently supporting the DoD and the FAA in their efforts to prevent spectrum interference on radar systems. He asked Ms. Baker to discuss how modernizing the use of monies within the Spectrum Relocation Fund (SRF) would support the ITS’s research mission to inform future spectrum policy decisions.
  • Ms. Baker noted how there was a school of thought that monies in the SRF could not be used for the purposes of future spectrum management. She elaborated that monies in the SRF could only be used for scheduled spectrum auctions. She suggested that the Committee consider potential improvements for the SRF that would allow for monies in the SRF to be used for the purposes of future spectrum management. She also noted how the NTIA was uniquely barred from using the SRF. She further expressed support for increased funding for the ITS and highlighted how the ITS served as a neutral arbiter for spectrum decisions.
• Sen. Hickenlooper then asked Dr. Bazelon to identify use cases for how unlicensed spectrum benefited society. He also asked Dr. Bazelon to address how the value of unlicensed spectrum ought to be factored into spectrum reallocation decisions.
  • Dr. Bazelon remarked that the wireless uses of unlicensed spectrum did not create bidding demand for spectrum at auctions. He stated however that unlicensed spectrum still provided a significant amount of value for consumers. He commented that this value could not simply be measured through the number of WiFi-connected devices being sold. He stated that policymakers ought to consider these intangible benefits when determining the amount of licensed and unlicensed spectrum that ought to be made available.
• Sen. Hickenlooper then noted how the GAO had found that there did not exist a collaboration process for agencies on spectrum policy matters. He asked Mr. Von Ah to indicate whether the GAO had recommendations for resolving these interagency spectrum policy disputes that would involve the use of independent third-party analysis. 
  • Mr. Von Ah stated that the GAO did not have any recommendations specific to using an independent third-party. He indicated that the GAO had traditionally deferred to the agencies to determine amongst themselves which technical studies they will use. He commented that the GAO would likely be supportive of federal agencies that sought out third-party arbiters to settle technical disputes. He mentioned how the recent MOU between the FCC and the NTIA had discussed the importance of increased technical information sharing between the agencies. He indicated that this information sharing would involve the agencies sitting on the advisory committees of other agencies.

Sen. Todd Young (R-IN):

• Sen. Young mentioned how the FCC and the NTIA had just released a new MOU on spectrum coordination. He asked Mr. Von Ah and Ms. Baker to discuss the importance of interagency spectrum coordination and to provide recommendations for how the U.S. could improve current interagency coordination efforts.
  • Mr. Von Ah remarked that interagency collaboration on spectrum policy matters was needed to prevent conflicts. He commented that these conflicts can often jeopardize national security or public safety. He called it important for federal agencies to understand how proposed spectrum reallocations might impact users in adjacent bands. He commended the new MOU between the FCC and the NTIA and stated that it was aligned with the GAO’s recommendations.
  • Ms. Baker applauded the leadership of the FCC and the NTIA for reaching the MOU and called the MOU a “good first step.” She stated however that the FCC and the NTIA had to take additional actions to promote spectrum coordination. She recommended that the NTIA Administrator position ought to be raised to the Under Secretary level and commented that this move would signal the NTIA’s role as the final arbiter in federal spectrum arguments.
• Sen. Young then called the FCC’s spectrum auction authority one of the Agency’s most powerful tools. He noted how this auction authority was currently set to expire on September 30, 2022. He asked Dr. Bazelon and Ms. Baker to discuss the importance of extending the FCC’s spectrum auction authority.
  • Ms. Baker called it “critical” for Congress to extend the FCC’s spectrum auction authority. She expressed support for an 18-month extension of this authority. She remarked that this approach would provide policymakers and stakeholders with sufficient time to develop a longer-term spectrum strategy and to develop a plan to replenish the U.S.’s spectrum pipeline. She contended that replenishing this pipeline was critical considering how other countries were making spectrum available.
  • Dr. Bazelon remarked that allowing the FCC’s spectrum auction authority to expire would be counterproductive and called this auction authority critical for the U.S.’s spectrum management capabilities. He stated that spectrum auctions helped to spur spectrum reallocations through creating budgetary incentives. He commented that these incentives would exist regardless of whether there was a long-term extension of this authority. He stated however that this budgetary incentive would be stronger if Congress were to enact an 18-month extension of this authority and were to plan directed spectrum reallocations after the 18-month extension’s enactment.
• Sen. Young also noted how the FCC was currently conducting a spectrum auction. He asked Ms. Baker to address what would happen if the FCC’s spectrum auction authority were to expire.
  • Ms. Baker remarked that the impact of allowing the FCC’s spectrum auction authority to expire was unknown as Congress had never permitted this authority to expire. She stated that the expiration of this authority would therefore create uncertainties for bidders, which could harm spectrum the bidders.

Full Committee Chairman Maria Cantwell (D-WA):

• Chairman Cantwell noted how Dr. Bazelon had contended that the Committee was focused on spectrum policy matters from a budgetary perspective. She asked Dr. Bazelon to provide recommendations for how the Committee ought to approach spectrum policy matters.
  • Dr. Bazelon discussed how spectrum was used because of the commercial value it creates and stated that wireless network capacity was critical. He noted that wireless network capacity could be increased through adding spectrum to the network, more efficient technologies (such as 5G technologies), and investing in infrastructure. He stated that future IoT technologies and currently inconceivable technologies would likely have different spectrum demand profiles.
• Chairman Cantwell asked Dr. Bazelon to confirm that the demand for spectrum was not slowing down.
  • Dr. Bazelon remarked that the demand for communications technology was growing significantly. He asserted that more spectrum alone would not be sufficient for meeting this growing demand. He stated that more infrastructure investment and more efficient spectrum uses would be needed to meet this demand.
• Chairman Cantwell asked Dr. Bazelon to confirm that he was arguing that the U.S. ought to prioritize efficiency in spectrum allocation and reallocation decisions.
  • Dr. Bazelon answered affirmatively. He stated that budgetary benefits were not the primary reason that the U.S. government held spectrum auctions and commented that these auctions were meant to reallocate spectrum in an efficient manner.
• Chairman Cantwell then expressed interest in how the monies raised from the FCC’s spectrum auctions were being used.
  • Dr. Bazelon remarked that using the money raised from the spectrum auctions for communications services, such as NG911, was reasonable. He also stated that policymakers needed to take a broader perspective on the value being created by spectrum auctions. He elaborated that a bidder might bid less for a given portion of spectrum in order to afford the infrastructure investments needed to make use of the spectrum. 
• Chairman Cantwell remarked that the U.S. needed to better understand the growing demand for spectrum.
  • Dr. Bazelon remarked that the U.S. wireless sector would continue to grow and that the U.S. would face challenges in terms of meeting the increased demand for spectrum.

Sen. Mike Lee (R-UT):

• Sen. Lee noted how federal agencies often made objections to spectrum reallocation decisions late in the spectrum reallocation process. He commented that these objections were often based on unspecified public safety and national security claims. He asked Ms. Baker to discuss how these late objections from federal agencies impacted the deployment of wireless networks.
  • Ms. Baker stated that the FAA’s recent objections to a spectrum reallocation decision had delayed the U.S.’s deployment of 5G technology by over six months. She noted how the next bands of spectrum set to be reallocated were mid-band spectrum, which were currently being used by government agencies. She called it important for either the NTIA or the FCC to be empowered to be the final arbiter in spectrum reallocation decisions and to stop federal agencies from lodging late objections to these decisions.
• Sen. Lee contended that the U.S. needed to fix the current spectrum reallocation process. He then applauded the FCC and the NTIA for their update of their MOU on spectrum coordination. He expressed concerns however that other federal agencies were abusing the spectrum reallocation process. He suggested that other federal agencies might be withholding relevant and necessary information from public view, the FCC, or the NTIA in some instances. He asked Ms. Baker to indicate whether other federal agencies needed to cooperate and be transparent with both the FCC and the NTIA on spectrum reallocation decisions.
  • Ms. Baker answered affirmatively. She stated that the IRAC process had broken down in the years since she had left the NTIA and called for fixing this process.
• Sen. Lee asked Ms. Baker to identify the risks associated with Congress’s failure to address the spectrum reallocation process.
  • Ms. Baker stated that Congress ought to explicitly state that the FCC and the NTIA were the final arbiters in spectrum policy disputes and commented that such direction would help to prevent problems from other federal agencies.
• Sen. Lee remarked that the U.S. was trailing other countries in terms of its clearing of mid-band spectrum and that the U.S.’s spectrum pipeline was “nearly depleted.” He asked Ms. Baker to discuss how the U.S.’s current spectrum policy coordination process and lack of a spectrum pipeline were impacting the U.S.’s global competitiveness.
  • Ms. Baker remarked that the U.S. needed a spectrum pipeline so that it could remain globally competitive. She stated the most recent C-band spectrum dispute involving the FAA had undermined efforts to identify spectrum for future auctions.
• Sen. Lee remarked that Congress should not allow for the FCC’s spectrum auction authority to lapse. He also commented that Congress’s failure to address the current challenges related to spectrum would undermine the U.S.’s long-term global competitiveness. He also Ms. Baker to indicate whether the U.S. required “pro-growth” spectrum polices moving forward.
  • Ms. Baker stated that Congress needed to direct the FCC to auction off specific spectrum bands as part of its reauthorization of the FCC’s spectrum auction authority. She commented that Congressional direction would ensure that these spectrum auctions would occur. She warned that the U.S.’s failure to maintain a spectrum pipeline would lead innovation to move abroad.

Sen. Ted Cruz (R-TX):

• Sen. Cruz remarked that the FCC’s spectrum auction program had been a success for the American people and noted how the FCC’s auction design and automated system had been studied, licensed, or copied worldwide. He stated that the FCC’s spectrum auctions had generally led to increased competition, opportunities for new market entrants, and benefits for customers. He lamented however that the number and volume of fights over proposed uses for bands of spectrum had grown. He commented that these fights involving federal agencies and stakeholders were injecting uncertainty into the marketplace and undermining the spectrum auction system. He asked the witnesses to indicate whether the U.S.’s spectrum management process was broken.
  • Mr. Lewis expressed hope that the U.S.’s spectrum management process was “on the mend” and commended the FCC and the NTIA for reaching a new MOU. He stated that policymakers should take additional actions to address technical issues related to spectrum and to ensure that the FCC and the NTIA would serve as the final authorities on technical issues related to spectrum. He called for increased cooperation between agencies on spectrum policy matters.
  • Ms. Baker remarked that the U.S.’s spectrum management process could be improved. She noted that many of the U.S.’s spectrum management problems were technical in nature. She stated that these problems needed to be raised earlier during spectrum policy discussions. She expressed support for increasing the ITS’s funding and commented that the ITS could provide neutral technical input for spectrum policy disputes. She further called for empowering the FCC and the NTIA to serve as the final authorities in spectrum disputes. She lastly suggested that policymakers look at the SRF to proactively identify future spectrum reallocations. She commented that this proactive identification could inform the research that would be conducted.
  • Mr. Von Ah remarked that while the U.S.’s spectrum management process was not broken, he commented that the process had failed in several instances. He stated that federal agencies generally believed that the NTIA was appropriately representing them in routine spectrum disputes. He remarked however that the U.S.’s spectrum management process tended to breakdown when there were more complicated disputes involving multiple federal agencies and unresolved technical questions. He mentioned how the GAO had made recommendations to address these issues and applauded the FCC and the NTIA for their recent MOU.
  • Dr. Bazelon called the U.S.’s current spectrum management process “clunky” and “inefficient.” He stated that while this process was currently working, he warned that the process’s inefficiencies were becoming increasingly problematic.

Sen. Dan Sullivan (R-AK):

• Sen. Sullivan noted how the FCC’s spectrum auction authority had been in existence since 1993 and had never experienced a lapse in authorization. He asked Ms. Baker to address how allowing this spectrum auction authority to lapse would impact the 2.5 GHz band auction currently in progress. He also asked Ms. Baker to project how a lapse in this authority would impact the wireless communications industry.
  • Ms. Baker emphasized that the FCC’s spectrum auction authority had never lapsed, which meant that the consequences of a lapse were currently unknown. She contended that no one wanted to find out what would occur in the event of the authority lapsing. She also discussed how the wireless communications industry was growing rapidly in the U.S., which would require more spectrum to be made available. She stated that the FCC would therefore require spectrum auction authority to make this spectrum available.
• Sen. Sullivan asked Ms. Baker, Mr. Lewis, and Dr. Bazelon to recommend policy priorities for a longer-term spectrum reauthorization bill.
  • Ms. Baker remarked that there needed to be spectrum pipeline legislation to accompany spectrum auction authority reauthorization. She contended that this spectrum pipeline legislation ought to focus on making mid-band spectrum available and noted how federal agencies currently owned two-thirds of mid-band spectrum. She stated that Congress should specify which bands of mid-band spectrum should be made available for auction. She specifically suggested that Congress focus on the 3.1-3.45 GHz band, the 4 GHz band, and the 7 GHz band.
  • Mr. Lewis remarked that longer-term reauthorization of the FCC’s spectrum auction authority would signal to federal agencies that the U.S. was committed to building out its spectrum pipeline. He also stated that a longer-term reauthorization of this auction authority would provide certainty to spectrum bidders, the wireless communications industry, innovators, the U.S. government, and other sectors.
  • Dr. Bazelon remarked that the U.S.’s spectrum pipeline needed to be filled. He stated that the FCC, the NTIA, and federal agencies needed to perform analyses to identify which bands of spectrum were optimal for reallocation. He asserted that it was therefore critical for these agencies to have sufficient resources and authority to perform such analyses so that Congress could make more informed spectrum policy decisions.
• Sen. Sullivan then remarked that the U.S. required better interagency coordination for allocating spectrum and IIJA funds. He mentioned how the GAO had released several reports on federal spectrum coordination, which had provided recommendations to the FCC and the NTIA. He asked Mr. Von Ah to discuss these GAO reports. He also asked Mr. Von Ah to comment on the new MOU between the FCC and the NTIA on spectrum coordination. He further asked Mr. Von Ah to provide recommendations for addressing interagency coordination issues beyond the area of spectrum policy.
  • Mr. Von Ah remarked that the GAO’s recommendations sought to encourage the FCC and the NTIA to improve their coordination processes and commented that the new MOU between the agencies would be helpful. He also mentioned how GAO had issued a recommendation to the NTIA regarding the Agency’s coordination with other federal agencies during the IRAC process. He indicated that the GAO had recommended that the NTIA explain and document its procedures for representing the views of federal agencies in FCC proceedings. He commented that such explanations and documentations would foster federal agency confidence in the NTIA and the broader spectrum reallocation process.
• Sen. Sullivan lastly expressed interest in how the FCC and the NTIA were coordinating on broadband deployment issues.

Subcommittee Chairman Ben Ray Luján (D-NM):

• Chairman Luján applauded the FCC and the NTIA for their new MOU on spectrum coordination. He asserted however that this MOU should only be viewed as an initial step. He also remarked that the FCC and the NTIA ought to be empowered to prioritize the public interest in their future spectrum policy discussions. He then noted how Ms. Baker had recommended that the NTIA Administrator position be promoted to the Under Secretary level at the U.S. Department of Commerce. He asked Ms. Baker to elaborate on this recommendation.
  • Ms. Baker stated that Assistant Secretaries often faced challenges in terms of interacting with Cabinet-level officials because of their differences in ranks. She remarked that evaluating the NTIA Administrator to the Under Secretary level would provide the NTIA Administrator with more credibility in their interactions with other government officials.
• Chairman Luján expressed his receptiveness to the recommendation to elevate the NTIA Administrator position to the Under Secretary level. He then asked Mr. Lewis to provide recommendations for how Congress could prioritize public safety needs in its development of national spectrum policy.
  • Mr. Lewis remarked that there were several ways that Congress could prioritize public safety needs, including through investments in NG911. He stated that Congress ought to emphasize resiliency of communications networks so that people will have confidence in the availability of these networks during natural disasters and emergency situations. He further discussed the importance of setting rules for prioritization on communications networks and commented that emergency and other public safety communications ought to be prioritized.
• Chairman Luján then discussed the FCC’s Enhanced Competition Incentive Program (ECIP), which sought to increase access to advanced wireless services in rural and Tribal communities. He asked Mr. Lewis to discuss how Congress could expand on ECIP to better promote competition within the wireless technology space.
  • Mr. Lewis remarked that Congress should extend ECIP’s concepts and values to more areas. He stated that Congress should incentivize licensed services to partition off spectrum not in use so that underserved communities could use the spectrum.
• Chairman Luján remarked that ECIP could play a key role in improving broadband internet access for states with topography and geography challenges. He then discussed how there were often wireless technology connection and adoption challenges in Tribal areas due to short timeline and build out requirements. He asked Mr. Von Ah to provide recommendations for ensuring that Tribes would be able to make use of federal broadband internet connectivity programs.
  • Mr. Von Ah mentioned how the GAO had recently reissued a report on Tribal broadband issues. He stated that the FCC’s Tribal Priority Window program had helped to provide Tribes with access to spectrum licenses. He noted however that many of the Tribes that had obtained spectrum licenses under this program did not receive funding to build out their spectrum capabilities associated with the licenses, which had led to frustrations. He stated that federal programs that could support wireless technology infrastructure build outs had their own timeframes. He further noted how many Tribes that received spectrum licenses under the Tribal Priority Window often lacked telecommunications providers or utilities that could readily deploy the spectrum. He stated that the GAO’s recommendations were focused on leveraging federal programs and investments to address the aforementioned challenges. He noted how the GAO had recommended that the Executive Office of the President include a Tribal focus in a national broadband strategy. He also highlighted how the GAO had recommended that the NTIA’s OICG be cognizant of Tribal issues in their interactions with other federal agencies.
• Chairman Luján expressed hope that several Committees would demonstrate interest in Tribal broadband internet connectivity issues. He then noted that legislation from the U.S. House of Representatives would extend the FCC’s spectrum auction authority for 18 months. He asked the witnesses to indicate whether they would support extensions of this authority that were greater than 18 months.
  • Mr. Lewis expressed his preference for a longer-term extension of the FCC’s spectrum auction authority.
  • Ms. Baker expressed support for the proposed 18-month extension of the FCC’s spectrum auction authority. She stated that this short-term extension would provide policymakers and stakeholders with enough time to develop a longer-term extension that would identify specific bands of spectrum for auction. She asserted that this approach would enable the U.S. to build a robust spectrum pipeline. She commented that the development of this pipeline was especially important given how other countries were currently working to deploy 5G communications technology.
  • Mr. Von Ah expressed the GAO’s view that the extension of the FCC’s spectrum auction authority was very important. He stated that proposed spectrum reallocations ought to undergo the existing review processes involving the FCC, the NTIA, and affected federal agencies.
  • Dr. Bazelon remarked that the U.S. needed both long-term spectrum auction authority and a robust spectrum auction pipeline. He argued that policymakers should be open to an 18-month extension of the FCC’s spectrum authority if the extension were to enable the development of a more robust spectrum pipeline. He stated however that an 18-month extension was still very short and would limit the planning capabilities of the FCC and the NTIA.
• Chairman Luján expressed hope that Congress will extend the FCC’s spectrum auction authority. He then asked Ms. Baker to confirm that not all CITA members would be impacted by a proposed 15 percent minimum tax on book income. He commented that this proposed tax would only impact companies with $1 billion in profit based on his understanding.
  • Ms. Baker criticized the proposed 15 percent minimum tax on book income for retroactively taxing the input for critical infrastructure. She asserted that this proposed tax would impede the U.S.’s buildout of broadband internet services.
• Chairman Luján commented that the proposed tax under consideration would impact either five or six of CITA’s over 200 members.
  • Ms. Baker confirmed Chairman Luján’s comment and stated that this proposed tax would impact CITA’s members that were working to deploy broadband internet services nationwide. She also expressed interest in following up with the Committee on this issue.