**A BILL**

To amend the Communications Act of 1934 to terminate the
Telecommunications Development Fund; to provide the Federal
Communications Commission with permanent authority to auction spectrum
licenses, and with new authority to charge fees for unauctioned spectrum
licenses and construction permits; and to clarify the Commission's
authority to auction licenses for domestic satellite communications
services and terrestrial services on frequencies allocated for mobile
satellite services.

***Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled, That***

**S[ection]{.smallcaps}. 1. [Termination of the Telecommunications
Development Fund. ]{.smallcaps}**

\(a\) Section 714 of the Communications Act of 1934, as amended,
(47 U.S.C. § 614) is amended by adding the following new subsection at
the end thereof:

> "(l) [termination**.**]{.smallcaps} -- As of the date of enactment of
> this act, the Fund is dissolved and shall cease to undertake
> activities pursuant to this section. Remaining assets and balances of
> the accounts of the Fund shall be returned and deposited into the
> general fund of the Treasury.".

\(b\) Section 309(j)(8)(C)(iii) of the Communications Act of 1934, as
amended, (47 U.S.C. § 309(j)(8)(C)(iii)), is amended by striking
everything after "transferred" and inserting in lieu thereof "to the
Treasury."

**S[ec.]{.smallcaps} 2. [Permanent Extension of Auction
Authority.]{.smallcaps}**

Section 309(j) of the Communications Act of 1934 is amended by repealing
paragraph (11).

**[Sec. 3. Authority to Establish Spectrum License User
Fees.]{.smallcaps}**

Section 309 of the Communications Act of 1934 is amended by adding the
following new subsection at the end thereof:

> "(m) [Use of Spectrum License User Fees.]{.smallcaps} -- For licenses
> or construction permits or renewals thereof which are not granted
> through the use of competitive bidding as set forth in subsection (j),
> the Commission is authorized to establish, assess, and collect annual
> user fees on holders of spectrum licenses or construction permits,
> including their successors or assignees, in order to promote efficient
> and effective use of the electromagnetic spectrum.
>
> "(1) [Development of Fee Regulations]{.smallcaps}. --
>
> "(A) The Commission shall, by regulation, establish a methodology for
> assessing annual user fees and a schedule for collection of such fees
> on classes of spectrum licenses or construction permits consistent
> with the public interest, convenience and necessity. The Commission
> may determine over time different classes of spectrum licenses or
> construction permits upon which such fees may be assessed. In
> establishing the fee methodology, the Commission may consider the
> following factors:
>
> "(i) scope and type of permissible services and uses;
>
> "(ii) amount of spectrum and licensed coverage area;
>
> "(iii) shared versus exclusive use;
>
> "(iv) level of demand for spectrum licenses or construction permits
> within a certain spectrum band or geographic area; and
>
> "(v) other such factors that the Commission determines, in its
> discretion, are necessary to promote efficient and effective spectrum
> use.
>
> "(B) Within 60 days of enactment of this Act, the Commission shall
> commence a rulemaking to develop the fee methodology and regulations.
> The Commission shall take all actions necessary so that it can collect
> fees from the first class or classes of spectrum license or
> construction permit holders no later than September 30, 2008.
>
> "(C) The Commission, from time to time, may commence further
> rulemakings (separate from or in connection with other rulemakings or
> proceedings involving spectrum-based services, licenses, permits and
> uses) and modify the fee methodology or revise its rules required by
> paragraph (B) to add or modify classes of spectrum license or
> construction permit holders that must pay fees to reflect appropriate
> increases or decreases in fees as a result of the addition, deletion,
> reclassification or other change in a spectrum-based service or use,
> including changes in the nature of a spectrum-based service or use as
> a consequence of Commission rulemaking proceedings or changes in law.
> Any resulting changes in the classes of spectrum licenses,
> construction permits or fees shall take effect upon the dates
> established in the Commission's rulemaking proceeding or by law.
>
> "(D) The Commission shall exempt from such fees public safety
> licensees, including emergency response providers. The term "emergency
> response providers" includes State, local, and tribal, emergency
> public safety, law enforcement, firefighter, emergency response,
> emergency medical (including hospital emergency facilities), and
> related personnel, agencies and authorities.
>
> "(2) [Penalties for Late Payment]{.smallcaps}. -- The Commission shall
> prescribe by regulation an additional charge which shall be assessed
> as a penalty for late payment of fees required by this subsection.
>
> "(3) [Revocation of License or Permit]{.smallcaps}. -- The Commission
> may revoke any spectrum license or construction permit for a
> licensee's or permitee's failure to pay in a timely manner any fee or
> penalty to the Commission under this subsection.
>
> "(4) [Treatment of Revenues]{.smallcaps}. -- All proceeds obtained
> pursuant to the regulations required by this subsection shall be
> deposited in the general fund of the Treasury."

[**Sec. 4. Authority to Auction licenses for domestic satellite
services**.]{.smallcaps}

Section 309(j) of the Communications Act of 1934 is amended adding the
following new subsections at the end thereof:

> "(17) Notwithstanding any other provision of law, the Commission shall
> use competitive bidding to assign any license, construction permit,
> reservation, or similar authorization or modification thereof, to the
> extent that it is used solely or predominantly for domestic satellite
> communications services, including satellite-based television or radio
> services. A service is defined to be predominantly for domestic
> services if the majority of customers or revenue associated with the
> service results from use within the geographic boundaries of the
> United States. The Commission may, however, use an alternative
> approach to assignment of licenses or similar authorities if it finds
> that such an alternative to competitive bidding would serve the public
> interest, convenience, and necessity. This paragraph shall be
> effective on the date of its enactment and shall apply to all current
> and future Commission assignments or reservations of spectrum for
> domestic satellite services, including, but not limited to, all
> assignments or reservations for satellite-based broadcasting of
> television or radio services as of the effective date.
>
> "(18) Notwithstanding any other provision of law, the Commission shall
> assign by competitive bidding any license, construction permit,
> reservation, or similar authorization or modification thereof, that
> grants authority to provide the ancillary terrestrial component to
> mobile satellite services, if the Commission finds that the provision
> of the ancillary terrestrial component by a provider distinct from the
> satellite component is technically feasible, such finding to be made
> within fifteen months of enactment of this provision. If the
> Commission finds that separate operation of the terrestrial and
> satellite components to mobile satellite services is not technically
> feasible, such finding shall be re-examined on a periodic basis,
> consistent with technological development. This provision shall apply
> to any assignment made after the date of enactment for mobile
> satellite services to which terrestrial operations may be authorized,
> including reassignment of a current authorization. The Commission may
> reassign any authorization for international or global communications
> service or domestic satellite communications service if the licensee
> or permit holder fails to meet service milestones and other
> requirements as required by the Commission."