**PUBLIC NOTICE**

**FEDERAL COMMUNICATIONS COMMISSION**

**445 12th STREET, SW**

**WASHINGTON, DC 20554**

#######  {#section .unnumbered}

####### DA 01-477 {#da-01-477 .unnumbered}

**February 23, 2001**

###### AUCTION OF LICENSES FOR THE  {#auction-of-licenses-for-the .unnumbered}

**VHF PUBLIC COAST AND**

**LOCATION AND MONITORING SERVICES SPECTRUM**

##### SCHEDULED FOR JUNE 6, 2001 {#scheduled-for-june-6-2001 .unnumbered}

**COMMENT SOUGHT**

**ON RESERVE PRICES OR MINIMUM OPENING BIDS AND**

###### OTHER AUCTION PROCEDURAL ISSUES {#other-auction-procedural-issues .unnumbered}

**Report No. AUC‑39-A (Auction No. 39)**

By this Public Notice, the Wireless Telecommunications Bureau ("Bureau")
announces the auction of 16 VHF public coast licenses[^1] and 241
multilateration Location and Monitoring Service ("LMS") licenses[^2]
("Auction No. 39") to commence on June 6, 2001. This auction will
include the licenses that remained unsold in Auctions No. 20 and No. 21,
which closed on December 14, 1998 and March 5, 1999, respectively.
Auction No. 39 will include the following:

-   **VHF Public Coast**. Specifically, sixteen licenses will be
    available in geographic areas known as VHF Public Coast Areas
    (VPCs). There are two categories of VPCs: maritime VPCs and inland
    VPCs. All of the VHF Public Coast licenses to be offered in Auction
    No. 39 are inland VPC licenses. Inland VPCs are identical to the
    Commerce Department's Economic Areas[^3], no part of which is within
    100 miles of a major waterway. Each VPC license has seven 25 kHz
    channel pairs, adding up to 350 kHz.

> [Inland VPCs:]{.underline} [Channel Pairs]{.underline} (total kHz
> available)
>
> Inland Border VPCs:, 24, 26, 27, 28, 85, 86, 87 (350 kHz)
>
> VPCs 10, 11
>
> Inland Non-Border VPCs:
>
> VPCs 12-15, 23, 26, 38 24, 26, 27, 28, 85, 86, 87 (350 kHz)
>
> VPCs 16, 18, 19, 20, 21, 22, 40 24, 26, 27, 28, 84, 86, 87 (350 kHz)

-   **LMS**. Three blocks of spectrum are allocated for LMS systems:

\(1\) Block A 904.000 -- 909.750 MHz and 927.750 -- 928.000 MHz

\(2\) Block B 919.750 -- 921.750 MHz and 927.500 -- 927.750 MHz

\(3\) Block C 921.750 -- 927.250 MHz and 927.250 -- 927.500 MHz

A geographic licensing area is comprised of each of these spectrum
blocks. LMS spectrum is licensed in 176 Economic Areas (EAs). In Auction
No. 39, 241 LMS licenses will be available: 117 licenses will be
auctioned in Block A, 61 licenses will be auctioned in Block B, and 63
licenses will be auctioned in Block C.

A list of licenses available for this auction is included in Attachment
A.

The Balanced Budget Act of 1997 requires the Commission to "ensure that,
in the scheduling of any competitive bidding under this subsection, an
adequate period is allowed . . . before issuance of bidding rules, to
permit notice and comment on proposed auction procedures . . . ."[^4]
Consistent with the provisions of the Balanced Budget Act and to ensure
that potential bidders have adequate time to familiarize themselves with
the specific rules that will govern the day-to-day conduct of an
auction, the Commission directed the Bureau, under its existing
delegated authority,[^5] to seek comment on a variety of
auction-specific procedures prior to the start of each auction.[^6] We
therefore seek comment on the following issues relating to Auction No.
39.

# Auction Structure

##  Simultaneous Multiple Round Auction Design

We propose to award the licenses in a single, simultaneous
multiple-round auction. As described further below, this methodology
offers every license for bid at the same time in successive bidding
rounds. We seek comment on this proposal.

##  Upfront Payments and Initial Maximum Eligibility 

The Bureau has delegated authority and discretion to determine an
appropriate upfront payment for each license being auctioned taking into
account such factors as the population in each geographic license area,
and the value of similar spectrum.[^7] As described further below, the
upfront payment is a refundable deposit made by each bidder to establish
eligibility to bid on licenses. Upfront payments related to the specific
spectrum subject to auction protect against frivolous or insincere
bidding and provide the Commission with a source of funds from which to
collect payments owed at the close of the auction.[^8] With these
guidelines in mind, we propose for Auction No. 39, to calculate upfront
payments on a license-by-license basis using the following formulas:

-   **VHF Public Coast**

Inland VPC Licenses: \$.075 \* MHz \* Pops (the result rounded to the
nearest

hundred for results less than \$10,000) with a

minimum upfront payment of \$2,500 per license.

-   **LMS**

Block A: \$0.0004 \* MHz \* Pops (the result rounded to the nearest

hundred for results less than \$10,000) with a

> minimum upfront payment of \$1,000 per license.

Block B: \$0.0005 \* MHz \* Pops (the result rounded to the nearest

hundred for results less than \$10,000) with a

minimum upfront payment of \$1,000 per license.

Block C: \$0.0005 \* MHz \* Pops (the results rounded to the nearest

hundred for results less than \$10,000 and to the nearest

thousand for results greater than \$10,000) with a

minimum upfront payment of \$1,000 per license.

A complete list of all licenses, including the related license area
population and upfront payment, are listed herein as Attachment A. We
seek comment on this proposal.

We further propose that the amount of the upfront payment submitted by a
bidder will determine the initial maximum eligibility (as measured in
bidding units) for each bidder. Upfront payments will not be attributed
to specific licenses, but instead will be translated into bidding units
to define a bidder\'s initial maximum eligibility, which cannot be
increased during the auction. The maximum eligibility will determine the
licenses on which a bidder may bid in each round of the auction. Thus,
in calculating its upfront payment amount, an applicant must determine
the *maximum* number of bidding units it may wish to bid on (or hold
high bids on) in any single round, and submit an upfront payment
covering that number of bidding units. We seek comment on this proposal.

## Activity Rules

In order to ensure that the auction closes within a reasonable period of
time, an activity rule requires bidders to either place a valid bid
and/or be the standing high bidder during each round of the auction
rather than waiting until the end to participate. A bidder that does not
satisfy the activity rule will either use an activity rule waiver, if
any remain, or lose bidding eligibility in the auction.

We propose to divide the auction into two stages: Stage One and Stage
Two--- each characterized by an increased activity requirement. The
auction will start in Stage One. We propose that the auction will
generally advance to the next stage when the auction activity level, as
measured by the percentage of bidding units receiving new high bids, is
approximately thirty percent or below for three consecutive rounds of
bidding. However, we further propose that the Bureau retain the
discretion to change stages unilaterally by announcement during the
auction. In exercising this discretion, the Bureau will consider a
variety of measures of bidder activity, including, but not limited to,
the auction activity level, the percentage of licenses (as measured in
bidding units) on which there are new bids, the number of new bids, and
the percentage increase in revenue. We seek comment on these proposals.

For Auction No. 39, we propose the following activity requirements:

**Stage One:** In each round of Stage One, a bidder desiring to maintain
its current eligibility is required to be active on licenses
encompassing at least 80 percent of its current bidding eligibility.
Failure to maintain the requisite activity level will result in a
reduction in the bidder's bidding eligibility in the next round of
bidding (unless an activity rule waiver is used). During Stage One,
reduced eligibility for the next round will be calculated by multiplying
the current round activity by five-fourths (5/4).

**Stage Two:** In each round of Stage Two, a bidder desiring to maintain
its current eligibility is required to be active on 98 percent of its
current bidding eligibility. In this final stage, reduced eligibility
for the next round will be calculated by multiplying the current round
activity by fifty-fortyninths (50/49).

We seek comment on these proposals. If commenters believe that these
activity rules should be changed, they should explain their reasoning
and comment on the desirability of an alternative approach. Commenters
are advised to support their claims with analyses and suggested
alternative activity rules.

## Activity Rule Waivers and Reducing Eligibility

Use of an activity rule waiver preserves the bidder\'s current bidding
eligibility despite the bidder\'s activity in the current round being
below the required minimum level. An activity rule waiver applies to an
entire round of bidding and not to a particular license. Activity
waivers are principally a mechanism for auction participants to avoid
the loss of auction eligibility in the event that exigent circumstances
prevent them from placing a bid in a particular round.

The FCC auction system assumes that bidders with insufficient activity
would prefer to use an activity rule waiver (if available) rather than
lose bidding eligibility. Therefore, the system will automatically apply
a waiver (known as an "automatic waiver") at the end of any bidding
period where a bidder\'s activity level is below the minimum required
unless: (1) there are no activity rule waivers available; or (2) the
bidder overrides the automatic application of a waiver by reducing
eligibility, thereby meeting the minimum requirements.

A bidder with insufficient activity may wish to reduce its bidding
eligibility rather than use an activity rule waiver. If so, the bidder
must affirmatively override the automatic waiver mechanism during the
bidding period by using the reduce eligibility function in the bidding
software. In this case, the bidder\'s eligibility is permanently reduced
to bring the bidder into compliance with the activity rules as described
above. Once eligibility has been reduced, a bidder will not be permitted
to regain its lost bidding eligibility.

A bidder may proactively use an activity rule waiver as a means to keep
the auction open without placing a bid. If a bidder submits a proactive
waiver (using the proactive waiver function in the bidding software)
during a bidding period in which no bids are submitted, the auction will
remain open and the bidder\'s eligibility will be preserved. An
automatic waiver invoked in a round in which there are no new valid bids
will not keep the auction open.

We propose that each bidder in Auction No. 39 be provided with five
activity rule waivers that may be used at the bidder's discretion during
the course of the auction as set forth above. We seek comment on this
proposal.

## Information Relating to Auction Delay, Suspension, or Cancellation

For Auction No. 39, we propose that, by public notice or by announcement
during the auction, the Bureau may delay, suspend, or cancel the auction
in the event of natural disaster, technical obstacle, evidence of an
auction security breach, unlawful bidding activity, administrative or
weather necessity, or for any other reason that affects the fair and
competitive conduct of competitive bidding.[^9] In such cases, the
Bureau, in its sole discretion, may elect to resume the auction starting
from the beginning of the current round, resume the auction starting
from some previous round, or cancel the auction in its entirety. Network
interruption may cause the Bureau to delay or suspend the auction. We
emphasize that exercise of this authority is solely within the
discretion of the Bureau, and its use is not intended to be a substitute
for situations in which bidders may wish to apply their activity rule
waivers. We seek comment on this proposal.

# Bidding Procedures

##  Round Structure

The Commission will use its Automated Auction System to conduct the
electronic simultaneous multiple round auction format for Auction No.
39. The initial bidding schedule will be announced in a public notice to
be released at least one week before the start of the auction, and will
be included in the registration mailings. The auction format will
consist of sequential bidding rounds, each followed by the release of
round results. Details regarding the location and format of round
results will be included in the same public notice.

The Bureau has discretion to change the bidding schedule in order to
foster an auction pace that reasonably balances speed with the bidders'
need to study round results and adjust their bidding strategies. The
Bureau may increase or decrease the amount of time for the bidding
rounds and review periods, or the number of rounds per day, depending
upon the bidding activity level and other factors. We seek comment on
this proposal.

## Reserve Price or Minimum Opening Bid

The Balanced Budget Act calls upon the Commission to prescribe methods
by which a reasonable reserve price will be required or a minimum
opening bid established when FCC licenses are subject to auction
(*i.e.*, because the Commission has accepted mutually exclusive
applications for those licenses), unless the Commission determines that
a reserve price or minimum bid is not in the public interest.[^10]
Consistent with this mandate, the Commission has directed the Bureau to
seek comment on the use of a minimum opening bid and/or reserve price
prior to the start of each auction.[^11]

Normally, a reserve price is an absolute minimum price below which an
item will not be sold in a given auction. Reserve prices can be either
published or unpublished. A minimum opening bid, on the other hand, is
the minimum bid price set at the beginning of the auction below which
*no bids* are accepted. It is generally used to accelerate the
competitive bidding process. Also, in a minimum opening bid scenario,
the auctioneer generally has the discretion to lower the amount later in
the auction. It is also possible for the minimum opening bid and the
reserve price to be the same amount.

In light of the Balanced Budget Act, the Bureau proposes to establish
minimum opening bids for Auction No. 39. The Bureau believes a minimum
opening bid, which has been utilized in other auctions, is an effective
bidding tool.[^12] A minimum opening bid, rather than a reserve price,
will help to regulate the pace of the auction and provides flexibility.

Specifically, for Auction No. 39, the Commission proposes the following
formulae for calculating minimum opening bids on a license-by-license
basis:

-   **VHF Public Coast**

Inland VPC Licenses: \$.011 \* MHz \* Pops (the result rounded to the
nearest

hundred for results less than \$10,000) with a

minimum of no less than \$2,500 per license.

-   **LMS**

Block A: \$0.0004 \* MHz \* Pops (the result rounded to the nearest

hundred for results less than \$10,000) with a

minimum of no less than \$1,000 per license.

Block B: \$0.0005 \* MHz \* Pops (the result rounded to the nearest

hundred for results less than \$10,000) with a

> minimum of no less than \$1,000 per license.

Block C: \$0.0005 \* MHz \* Pops (the result rounded to the nearest

> hundred for results less than \$10,000 and to the nearest
>
> thousand for results greater than \$10,000) with a minimum of no less
> than \$1,000 per license.

The specific minimum opening bid for each license available in Auction
No. 39 is set forth in Attachment A herein. Comment is sought on this
proposal. If commenters believe that these minimum opening bids will
result in substantial numbers of unsold licenses, or are not reasonable
amounts, or should instead operate as reserve prices, they should
explain why this is so, and comment on the desirability of an
alternative approach. Commenters are advised to support their claims
with valuation analyses and suggested reserve prices or minimum opening
bid levels or formulas. In establishing the minimum opening bids, we
particularly seek comment on such factors as, among other things, the
amount of spectrum being auctioned, levels of incumbency, the
availability of technology to provide service, the size of the
geographic service areas, issues of interference with other spectrum
bands and any other relevant factors that could reasonably have an
impact on valuation of the VHF public coast station and the LMS
spectrum. Alternatively, comment is sought on whether, consistent with
the Balanced Budget Act, the public interest would be served by having
no minimum opening bid or reserve price.

## Minimum Accepted Bids and Bid Increments 

Once there is a standing high bid on a license, a bid increment will be
applied to that license to establish a minimum acceptable bid for the
following round. For Auction No. 39, we propose to use a smoothing
methodology to calculate bid increments, as we have done in several
other auctions. The Bureau retains the discretion to change the minimum
bid increment if it determines that circumstances so dictate. The Bureau
will do so by announcement in the Automated Auction System. We seek
comment on these proposals.

The exponential smoothing formula calculates the bid increment for each
license based on a weighted average of the activity received on each
license in all previous rounds. This methodology will tailor the bid
increment for each license based on activity, rather than setting a
global increment for all licenses. For every license that receives a
bid, the bid increment for the next round for that license will be
established using the exponential smoothing formula.

The calculation of the percentage bid increment for each license in a
given round is made at the end of the previous round. The computation is
based on an activity index, which is calculated as the weighted average
of the activity in that round and the activity index from the prior
round. The activity index at the start of the auction (round 0) will be
set at 0. The current activity index is equal to a weighting factor
times the number of new bids received on the license in the most recent
bidding round plus one minus the weighting factor times the activity
index from the prior round. The activity index is then used to calculate
a percentage increment by multiplying a minimum percentage increment by
one plus the activity index with that result being subject to a maximum
percentage increment. The Commission will initially set the weighting
factor at 0.5, the minimum percentage increment at 0.1 (10%), and the
maximum percentage increment at 0.2 (20%).

########  {#section-1 .unnumbered}

######## Equations {#equations .unnumbered}

A~i~ = (C \* B~i~) + ( (1-C) \* A~i-1~)

I~i+1~ = smaller of ( (1 + A~i~) \* N) and M

where,

A~i~ = activity index for the current round (round i)

C = activity weight factor

B~i~ = number of bids in the current round (round i)

A~i-1~ = activity index from previous round (round i-1), A~0~ is 0

I~i+1~ = percentage bid increment for the next round (round i+1)

N = minimum percentage increment or bid increment floor

M = maximum percentage increment or bid increment ceiling

Under the exponential smoothing methodology, once a bid has been
received on a license, the minimum acceptable bid for that license in
the following round will be the new high bid plus the dollar amount
associated with the percentage increment (variable I~i+1~ from above
times the high bid). This result will be rounded to the nearest thousand
if it is over ten thousand or to the nearest hundred if it is under ten
thousand.[^13]

########  {#section-2 .unnumbered}

######## Examples {#examples .unnumbered}

License 1

C=0.5, N = 0.1, M = 0.2

[Round 1 (2 new bids, high bid = \$1,000,000)]{.underline}

1\. Calculation of percentage increment for round 2 using exponential
smoothing:

A~1~ = (0.5 \* 2) + (0.5 \* 0) = 1

I~2~ = The smaller of ( (1 + 1) \* 0.1) = 0.2 or 0.2 (the maximum
percentage increment)

2\. Minimum bid increment for round 2 using the percentage increment
(I~2~ from above)

0.2 \* \$1,000,000 = \$200,000

3\. Minimum acceptable bid for round 2 = \$1,200,000

[Round 2 (3 new bids, high bid = \$2,000,000)]{.underline}

1\. Calculation of percentage increment for round 3 using exponential
smoothing:

A~2~ = (0.5 \* 3) + (0.5 \* 1) = 2

I~3~ = The smaller of ( (1 + 2) \* 0.1) = 0.3 or 0.2 (the maximum
percentage increment)

2\. Minimum bid increment for round 3 using the percentage increment
(I~3~ from above)

0.2 \* \$2,000,000 = \$400,000

3\. Minimum acceptable bid for round 3 = \$2,400,000

[Round 3 (1 new bid, high bid = \$2,400,000)]{.underline}

1\. Calculation of percentage increment for round 4 using exponential
smoothing:

A~3~ = (0.5 \* 1) + (0.5 \* 2) = 1.5

I~4~ = The smaller of ( (1 + 1.5) \* 0.1) = 0.25 or 0.2 (the maximum
percentage increment)

2\. Minimum bid increment for round 4 using the percentage increment
(I~4~ from above)

0.2 \* \$2,400,000 = \$480,000

3\. Minimum acceptable bid for round 4 = \$2,880,000

##  Information Regarding Bid Withdrawal and Bid Removal

For Auction No. 39, we propose the following bid removal and bid
withdrawal procedures. Before the close of a bidding period, a bidder
has the option of removing any bid placed in that round. By using the
remove bid function in the bidding software, a bidder may effectively
"unsubmit" any bid placed within that round. A bidder removing a bid
placed in the same round is not subject to a withdrawal payment. Once a
round closes, a bidder may no longer remove a bid. We seek comment on
this bid removal procedure.

Once a round closes, a bidder may no longer remove a bid. However, in
the next round, a bidder may withdraw standing high bids from previous
rounds using the withdraw bid function. A high bidder that withdraws its
standing high bid from a previous round is subject to the bid withdrawal
payment provisions.[^14] We seek comment on these bid removal and bid
withdrawal procedures.

In the *Part 1 Third Report and Order*, the Commission explained that
allowing bid withdrawals facilitates efficient aggregation of licenses
and the pursuit of efficient backup strategies as information becomes
available during the course of an auction. The Commission noted,
however, that, in some instances, bidders may seek to withdraw bids for
improper reasons. The Bureau, therefore, has discretion, in managing the
auction, to limit the number of withdrawals to prevent any bidding
abuses. The Commission stated that the Bureau should assertively
exercise its discretion, consider limiting the number of rounds in which
bidders may withdraw bids, and prevent bidders from bidding on a
particular market if the Bureau finds that a bidder is abusing the
Commission's bid withdrawal procedures.[^15]

Applying this reasoning, we propose to limit each bidder in Auction No.
39 to withdraw standing high bids in no more than two rounds during the
course of the auction. To permit a bidder to withdraw bids in more than
two rounds would likely encourage insincere bidding or the use of
withdrawals for anti-competitive strategic purposes. The two rounds in
which withdrawals are utilized will be at the bidder's discretion;
withdrawals otherwise must be in accordance with the Commission's rules.
There is no limit on the number of standing high bids that may be
withdrawn in either of the rounds in which withdrawals are utilized.
Withdrawals will remain subject to the bid withdrawal payment provisions
specified in the Commission's rules. We seek comment on this proposal.

## Stopping Rule

For Auction No. 39, the Bureau proposes to employ a simultaneous
stopping rule approach. The Bureau has discretion "to establish stopping
rules before or during multiple round auctions in order to terminate the
auction within a reasonable time."[^16] A simultaneous stopping rule
means that all licenses remain open until the first round in which no
new acceptable bids, proactive waivers, or withdrawals are received.
After the first such round, bidding closes simultaneously on all
licenses. Thus, unless circumstances dictate otherwise, bidding would
remain open on all licenses until bidding stops on every license.

The Bureau seeks comment on a modified version of the simultaneous
stopping rule. The modified stopping rule would close the auction for
all licenses after the first round in which no bidder submits a
proactive waiver, a withdrawal, or a new bid on any license on which it
is not the standing high bidder. Thus, absent any other bidding
activity, a bidder placing a new bid on a license for which it is the
standing high bidder would not keep the auction open under this modified
stopping rule. The Bureau further seeks comment on whether this modified
stopping rule should be used unilaterally or only in stage two of the
auction.

The Bureau proposes to retain the discretion to keep an auction open
even if no new acceptable bids or proactive waivers are submitted and no
previous high bids are withdrawn. In this event, the effect will be the
same as if a bidder had submitted a proactive waiver. The activity rule,
therefore, will apply as usual, and a bidder with insufficient activity
will either lose bidding eligibility or use a remaining activity rule
waiver.

Finally, we propose that the Bureau reserve the right to declare that
the auction will end after a specified number of additional rounds
("special stopping rule"). If the Bureau invokes this special stopping
rule, it will accept bids in the final round(s) only for licenses on
which the high bid increased in at least one of the preceding specified
number of rounds. The Bureau proposes to exercise this option only in
certain circumstances, such as, for example, where the auction is
proceeding very slowly, there is minimal overall bidding activity, or it
appears likely that the auction will not close within a reasonable
period of time. Before exercising this option, the Bureau is likely to
attempt to increase the pace of the auction by, for example, moving the
auction into the next stage (where bidders would be required to maintain
a higher level of bidding activity), increasing the number of bidding
rounds per day, and/or increasing the amount of the minimum bid
increments for the limited number of licenses where there is still a
high level of bidding activity. We seek comment on these proposals.

# Conclusion

Comments are due on or before March 9, 2001, and reply comments are due
on or before March 16, 2001. An original and four copies of all
pleadings must be filed with the Commission\'s Secretary, Magalie Roman
Salas, Office of the Secretary, Federal Communications Commission, 445
Twelfth Street, SW, TW-A325, Washington, DC 20554, in accordance with
Section 1.51(c) of the Commission\'s rules. See 47 C.F.R. § 1.51(c). In
addition, one copy of each pleading must be delivered to each of the
following locations: (1) the Commission\'s duplicating contractor,
International Transcription Service, Inc. (ITS), 1231 20th Street, N.W.,
Washington, DC 20036; (2) Office of Media Relations, Public Reference
Center, 445 Twelfth Street, SW, Suite CY-A257, Washington, DC 20554; (3)
Rana Shuler, Auctions and Industry Analysis Division, Wireless
Telecommunications Bureau, 445 Twelfth Street, SW, Suite 4-A628,
Washington, DC 20554. Comments and reply comments will be available for
public inspection during regular business hours in the FCC Public
Reference Room, Room CY-A257, 445 12th Street, SW, Washington, DC 20554.

For further information concerning this proceeding, contact the Auctions
and Industry Analysis Division, Wireless Telecommunications Bureau,
Kenneth Burnley, Auctions Attorney, or Lyle Ishida, Auctions Analyst, at
(202) 418-0660; or Linda Sanderson, Project Manager, at (717) 338-2888.

**-- FCC-**

[^1]: The Commission adopted service and competitive bidding rules for
    the VHF public coast station service. *See* Amendment of the
    Commission's Rules Concerning Maritime Communications*, Third Report
    and Order and Memorandum Opinion and Order*, 13 FCC Rcd 19853
    (1998).

[^2]: The Commission adopted service and competitive bidding rules for
    the Location and Monitoring Service. *See* Amendment of the
    Commission's Rules to Adopt Regulations for Automatic Vehicle
    Monitoring Systems, *Second Report and Order*, 13 FCC Rcd 15182
    (1998) ("*LMS Second Report and Order*").

[^3]: The Bureau of Economic Analysis of the Department of Commerce has
    divided the U.S. into 172 Economic Areas ("EAs"), effective April
    10, 1995, to facilitate regional economic analysis. Each EA consists
    of one or more economic nodes -- metropolitan areas or similar areas
    that serve as centers of economic activity -- and the surrounding
    counties that are economically related to the nodes. Final
    Redefinition of the BEA Economic Areas, Department of Commerce,
    Docket No. 950-3020-64-5064-01, 60 Fed. Reg. 13114 (Mar. 10, 1995).

[^4]: *See* Section 3002(a)(E)(i), Balanced Budget Act of 1997, Pub. L.
    105-33, 111 Stat. 251 (1997) ("Balanced Budget Act"), amending
    Section 309(j) of the Communications Act, 47 U.S.C. § 309(j).

[^5]: *See* Amendment of Part 1 of the Commission\'s Rules ---
    Competitive Bidding Proceeding, WT Docket No. 97-82, *Order,
    Memorandum Opinion and Order, and Notice of Proposed Rule Making*,
    12 FCC Rcd 5686, 5697, ¶ 16 (1997) ("*Part 1 Order*") ("We also
    clarify that pursuant to Section 0.131 of our rules, the Chief,
    Wireless Telecommunications Bureau, has delegated authority to
    implement all of the Commission\'s rules pertaining to auctions
    procedures").

[^6]: *See* Amendment of Part 1 of the Commission\'s Rules ---
    Competitive Bidding Procedures, Allocation of Spectrum Below 5 GHz
    Transferred from Federal Government Use, 4660-4685 MHz, WT Docket
    No. 97-82, ET Docket No. 94-32, *Third Report and Order and Second
    Further Notice of Proposed Rule Making*, 13 FCC Rcd 374, 448, ¶ 124
    (1998) ("*Part 1 Third Report and Order*"). The Commission directed
    the Bureau to seek comment on specific mechanisms related to
    day-to-day auction conduct including, for example, the structure of
    bidding rounds and stages, establishment of minimum opening bids or
    reserve prices, minimum accepted bids, initial maximum eligibility
    for each bidder, activity requirements for each stage of the
    auction, activity rule waivers, criteria for determining reductions
    in eligibility, information regarding bid withdrawal and bid
    removal, stopping rules, and information relating to auction delay,
    suspension or cancellation. *Id.* at ¶ 125.

[^7]: *See Part 1 Order,* 12 FCC Rcd at 5697-98, ¶ 16 (1997); s*ee also
    Part 1 Third Report and Order*, 13 FCC Rcd at 425, ¶ 86.

[^8]: *See* Implementation of Section 309(j) of the Communications Act -
    Competitive Bidding, PP Docket No. 93-253, *Second Report and
    Order*, 9 FCC Rcd 2348, 2378-79, ¶¶ 171-176 (1994).

[^9]: *See* 47 C.F.R. § 1.2104(i).

[^10]: *See* Balanced Budget Act, Section 3002(a). The Commission\'s
    authority to establish a reserve price or minimum opening bid is set
    forth in 47 C.F.R. § 1.2104(c) and (d).

[^11]: *See* *Part 1 Third Report and Order,* 13 FCC Rcd at 454-455, ¶
    141 (1998).

[^12]: *S*e*e*, *e.g.*, Auction of 800 MHz SMR Upper 10 MHz Band,
    Minimum Opening Bids or Reserve Prices, DA 97-2147, *Order*, 12 FCC
    Rcd 16354 (1997); Auction of the Phase II 220 MHz Service Licenses,
    Auction Notice and Filing Requirements for 908 Licenses Consisting
    of Economic Area (EA), Economic Area Grouping (EAG), and Nationwide
    Licenses, Scheduled for September 15, 1998, Minimum Opening Bids and
    Other Procedural Issues, *Public Notice*, 13 FCC Rcd 16445 (1998).

[^13]: Multiple increment bids are not rounded according to the
    previously stated rounding rule; they are received, displayed, and
    stored by the Automated Auction System as non-rounded dollar amounts
    resulting from the following formula: Amount Bid = High Bid + (Bid
    Multiplier \* Bid Increment).

[^14]: *See* 47 C.F.R. §§ 1.2104(g); 1.2109.

[^15]: *Part 1 Third Report and Order*, 13 FCC Rcd at 460, ¶ 150.

[^16]: *See* 47 C.F.R. § 1.2104(e).