108TH CONGRESS
1ST SESSION
H. R. 1320
AN ACT
To amend the National Telecommunications and
Information Administration Organization Act to
facilitate the reallocation of spectrum from gov-
ernmental to commercial users.
108TH CONGRESS
1ST SESSION
H. R. 1320
AN ACT
To amend the National Telecommunications and Information
Administration Organization Act to facilitate the re-
allocation of spectrum from governmental to commercial
users.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Commercial Spectrum
Enhancement Act’’.
SEC. 2. RELOCATION OF ELIGIBLE FEDERAL ENTITIES FOR
THE 
REALLOCATION 
OF 
SPECTRUM 
FOR
COMMERCIAL PURPOSES.
Section 113(g) of the National Telecommunications
and Information Administration Organization Act (47
U.S.C. 923(g)) is amended by striking paragraphs (1)
through (3) and inserting the following:
‘‘(1) ELIGIBLE FEDERAL ENTITIES.—Any Fed-
eral entity that operates a Federal Government sta-
tion assigned to a band of frequencies specified in
paragraph (2) and that incurs relocation costs be-
cause of the reallocation of frequencies from Federal
use to non-Federal use shall receive payment for
such costs from the Spectrum Relocation Fund, in
accordance with section 118 of this Act. For pur-
poses of this paragraph, Federal power agencies ex-
empted under subsection (c)(4) that choose to relo-
cate from the frequencies identified for reallocation
pursuant to subsection (a), are eligible to receive
payment under this paragraph.
‘‘(2) ELIGIBLE FREQUENCIES.—The bands of
eligible frequencies for purposes of this section are
as follows:
‘‘(A) the 216–220 megahertz band, the
1432–1435 megahertz band, the 1710–1755
megahertz band, and the 2385–2390 megahertz
band of frequencies; and
‘‘(B) any other band of frequencies reallo-
cated from Federal use to non-Federal use after
January 1, 2003, that is assigned by competi-
tive bidding pursuant to section 309(j) of the
Communications Act of 1934 (47 U.S.C.
309(j)), except for bands of frequencies pre-
viously identified by the National Telecommuni-
cations and Information Administration in the
Spectrum Reallocation Final Report, NTIA
Special Publication 95–32 (1995).
‘‘(3) DEFINITION OF RELOCATION COSTS.—For
purposes of this subsection, the term ‘relocation
costs’ means the costs incurred by a Federal entity
to achieve comparable capability of systems, regard-
less of whether that capability is achieved by relo-
cating to a new frequency assignment or by utilizing
an alternative technology. Such costs include—
‘‘(A) the costs of any modification or re-
placement of equipment, software, facilities, op-
erating manuals, training costs, or regulations
that are attributable to relocation;
‘‘(B) the costs of all engineering, equip-
ment, software, site acquisition and construc-
tion costs, as well as any legitimate and pru-
dent transaction expense, including outside con-
sultants, and reasonable additional costs in-
curred by the Federal entity that are attrib-
utable to relocation, including increased recur-
ring costs associated with the replacement fa-
cilities;
‘‘(C) the costs of engineering studies, eco-
nomic analyses, or other expenses reasonably
incurred in calculating the estimated relocation
costs that are provided to the Commission pur-
suant to paragraph (4) of this subsection;
‘‘(D) the one-time costs of any modifica-
tion of equipment reasonably necessary to ac-
commodate commercial use of such frequencies
prior to the termination of the Federal entity’s
primary allocation or protected status, when the
eligible frequencies as defined in paragraph (2)
of this subsection are made available for private
sector uses by competitive bidding and a Fed-
eral entity retains primary allocation or pro-
tected status in those frequencies for a period
of time after the completion of the competitive
bidding process; and
‘‘(E) the costs associated with the acceler-
ated replacement of systems and equipment if
such acceleration is necessary to ensure the
timely relocation of systems to a new frequency
assignment.
‘‘(4) NOTICE TO COMMISSION OF ESTIMATED
RELOCATION COSTS.—
‘‘(A) The Commission shall notify the
NTIA at least 18 months prior to the com-
mencement of any auction of eligible fre-
quencies defined in paragraph (2). At least 6
months prior to the commencement of any such
auction, the NTIA, on behalf of the Federal en-
tities and after review by the Office of Manage-
ment and Budget, shall notify the Commission
of estimated relocation costs and timelines for
such relocation.
‘‘(B) Upon timely request of a Federal en-
tity, the NTIA shall provide such entity with in-
formation regarding an alternative frequency
assignment or assignments to which their
radiocommunications operations could be relo-
cated for purposes of calculating the estimated
relocation costs and timelines to be submitted
to the Commission pursuant to subparagraph
(A).
‘‘(C) To the extent practicable and con-
sistent with national security considerations,
the NTIA shall provide the information re-
quired by subparagraphs (A) and (B) by the ge-
ographic location of the Federal entities’ facili-
ties or systems and the frequency bands used
by such facilities or systems.
‘‘(5) NOTICE TO CONGRESSIONAL COMMITTEES
AND GAO.—The NTIA shall, at the time of providing
an initial estimate of relocation costs to the Commis-
sion under paragraph (4)(A), submit to the Commit-
tees on Appropriations and Energy and Commerce
of the House of Representatives, the Committees on
Appropriations and Commerce, Science, and Trans-
portation of the Senate, and the Comptroller Gen-
eral a copy of such estimate and the timelines for re-
location.
‘‘(6) IMPLEMENTATION OF PROCEDURES.—The
NTIA shall take such actions as necessary to ensure
the timely relocation of Federal entities’ spectrum-
related operations from frequencies defined in para-
graph (2) to frequencies or facilities of comparable
capability. Upon a finding by the NTIA that a Fed-
eral entity has achieved comparable capability of sys-
tems by relocating to a new frequency assignment or
by utilizing an alternative technology, the NTIA
shall terminate the entity’s authorization and notify
the Commission that the entity’s relocation has been
completed. The NTIA shall also terminate such enti-
ty’s authorization if the NTIA determines that the
entity has unreasonably failed to comply with the
timeline for relocation submitted by the Director of
the Office of Management and Budget under section
118(d)(2)(B).’’.
SEC. 3. MINIMUM AUCTION RECEIPTS AND DISPOSITION OF
PROCEEDS.
(a) AUCTION DESIGN.—Section 309(j)(3) of the
Communications Act of 1934 (47 U.S.C. 309(j)(3)) is
amended—
(1) by striking ‘‘and’’ at the end of subpara-
graph (D);
(2) by striking the period at the end of sub-
paragraph (E) and inserting ‘‘; and’’; and
(3) by adding at the end the following new sub-
paragraph:
‘‘(F) for any auction of eligible frequencies
described in section 113(g)(2) of the National
Telecommunications and Information Adminis-
tration Organization Act (47 U.S.C. 923(g)(2)),
the recovery of 110 percent of estimated reloca-
tion costs as provided to the Commission pursu-
ant to section 113(g)(4) of such Act.’’.
(b) SPECIAL AUCTION PROVISIONS FOR ELIGIBLE
FREQUENCIES.—Section 309(j) of such Act is further
amended by adding at the end the following new para-
graph:
‘‘(15) SPECIAL AUCTION PROVISIONS FOR ELI-
GIBLE FREQUENCIES.—
‘‘(A) SPECIAL REGULATIONS.—The Com-
mission shall revise the regulations prescribed
under paragraph (4)(F) of this subsection to
prescribe methods by which the total cash pro-
ceeds from any auction of eligible frequencies
described in section 113(g)(2) of the National
Telecommunications and Information Adminis-
tration Organization Act (47 U.S.C. 923(g)(2))
shall at least equal 110 percent of the total esti-
mated relocation costs provided to the Commis-
sion pursuant to section 113(g)(4) of such Act.
‘‘(B) CONCLUSION OF AUCTIONS CONTIN-
GENT ON MINIMUM PROCEEDS.—The Commis-
sion shall not conclude any auction of eligible
frequencies described in section 113(g)(2) of
such Act if the total cash proceeds attributable
to such spectrum are less than 110 percent of
the total estimated relocation costs provided to
the Commission pursuant to section 113(g)(4)
of such Act. If the Commission is unable to
conclude an auction for the foregoing reason,
the Commission shall cancel the auction, return
within 45 days after the auction cancellation
date any deposits from participating bidders
held in escrow, and absolve such bidders from
any obligation to the United States to bid in
any subsequent reauction of such spectrum.
‘‘(C) AUTHORITY TO ISSUE PRIOR TO DE-
AUTHORIZATION.—In any auction conducted
under the regulations required by subparagraph
(A), the Commission may grant a license as-
signed for the use of eligible frequencies prior
to the termination of an eligible Federal entity’s
authorization. However, the Commission shall
condition such license by requiring that the li-
censee cannot cause harmful interference to
such Federal entity until such entity’s author-
ization has been terminated by the National
Telecommunications and Information Adminis-
tration.’’.
(c) DEPOSIT OF PROCEEDS.—Paragraph (8) of sec-
tion 309(j) of the Communications Act of 1934 (47 U.S.C.
309(j)) is amended—
(1) in subparagraph (A), by inserting ‘‘or sub-
paragraph (D)’’ after ‘‘subparagraph (B)’’; and
(2) by adding at the end the following new sub-
paragraph:
‘‘(D) DISPOSITION OF CASH PROCEEDS.—
Cash proceeds attributable to the auction of any
eligible 
frequencies 
described 
in 
section
113(g)(2) of the National Telecommunications
and Information Administration Organization
Act (47 U.S.C. 923(g)(2)) shall be deposited in
the Spectrum Relocation Fund established
under section 118 of such Act, and shall be
available in accordance with that section.’’.
SEC. 4. ESTABLISHMENT OF FUND AND PROCEDURES.
Part B of the National Telecommunications and In-
formation Administration Organization Act is amended by
adding after section 117 (47 U.S.C. 927) the following
new section:
‘‘SEC. 118. SPECTRUM RELOCATION FUND.
‘‘(a) ESTABLISHMENT OF SPECTRUM RELOCATION
FUND.—There is established on the books of the Treasury
a separate fund to be known as the ‘Spectrum Relocation
Fund’ (in this section referred to as the ‘Fund’), which
shall be administered by the Office of Management and
Budget (in this section referred to as ‘OMB’), in consulta-
tion with the NTIA.
‘‘(b) CREDITING OF RECEIPTS.—The Fund shall be
credited 
with 
the 
amounts 
specified 
in 
section
309(j)(8)(D) of the Communications Act of 1934 (47
U.S.C. 309(j)(8)(D)).
‘‘(c) USED
TO
PAY
RELOCATION
COSTS.—The
amounts in the Fund from auctions of eligible frequencies
are authorized to be used to pay relocation costs, as de-
fined in section 113(g)(3) of this Act, of an eligible Fed-
eral entity incurring such costs with respect to relocation
from those frequencies.
‘‘(d) FUND AVAILABILITY.—
‘‘(1) APPROPRIATION.—There are hereby ap-
propriated from the Fund such sums as are required
to pay the relocation costs specified in subsection
(c).
‘‘(2) TRANSFER
CONDITIONS.—None of the
funds provided under this subsection may be trans-
ferred to any eligible Federal entity—
‘‘(A) unless the Director of OMB has de-
termined, in consultation with the NTIA, the
appropriateness of such costs and the timeline
for relocation; and
‘‘(B) until 30 days after the Director of
the OMB has submitted to the Committees on
Appropriations and Energy and Commerce of
the House of Representatives, the Committees
on Appropriations and Commerce, Science, and
Transportation of the Senate, and the Comp-
troller General a detailed plan describing how
the sums transferred from the Fund will be
used to pay relocation costs in accordance with
such subsection and the timeline for such relo-
cation.
‘‘(3) REVERSION
OF
UNUSED
FUNDS.—Any
auction proceeds in the Fund that are remaining
after the payment of the relocation costs that are
payable from the Fund shall revert to and be depos-
ited in the general fund of the Treasury not later
than 8 years after the date of the deposit of such
proceeds to the Fund.
‘‘(e) TRANSFER TO ELIGIBLE FEDERAL ENTITIES.—
‘‘(1) TRANSFER.—
‘‘(A) Amounts made available pursuant to
subsection (d) shall be transferred to eligible
Federal entities, as defined in section 113(g)(1)
of this Act.
‘‘(B) An eligible Federal entity may receive
more than one such transfer, but if the sum of
the subsequent transfer or transfers exceeds 10
percent of the original transfer—
‘‘(i) such subsequent transfers are
subject to prior approval by the Director of
OMB as required by subsection (d)(2)(A);
‘‘(ii) the notice to the committees con-
taining the plan required by subsection
(d)(2)(B) shall be not less than 45 days
prior to the date of the transfer that
causes such excess above 10 percent;
‘‘(iii) such notice shall include, in ad-
dition to such plan, an explanation of need
for such subsequent transfer or transfers;
and
‘‘(iv) the Comptroller General shall,
within 30 days after receiving such plan,
review such plan and submit to such com-
mittees an assessment of the explanation
for the subsequent transfer or transfers.
‘‘(C) Such transferred amounts shall be
credited to the appropriations account of the el-
igible Federal entity which has incurred, or will
incur, such costs, and shall, subject to para-
graph (2), remain available until expended.
‘‘(2) RETRANSFER TO FUND.—An eligible Fed-
eral entity that has received such amounts shall re-
port its expenditures to OMB and shall transfer any
amounts in excess of actual relocation costs back to
the Fund immediately after the NTIA has notified
the Commission that the entity’s relocation is com-
plete, or has determined that such entity has unrea-
sonably failed to complete such relocation in accord-
ance with the timeline required by subsection
(d)(2)(A).’’.
SEC. 5. TELECOMMUNICATIONS DEVELOPMENT FUND.
Section 714(f) of the Communications Act of 1934
(47 U.S.C. 614(f)) is amended to read as follows:
‘‘(f) LENDING AND CREDIT OPERATIONS.—Loans or
other extensions of credit from the Fund shall be made
available to an eligible small business on the basis of—
‘‘(1) the analysis of the business plan of the eli-
gible small business;
‘‘(2) the reasonable availability of collateral to
secure the loan or credit extension;
‘‘(3) the extent to which the loan or credit ex-
tension promotes the purposes of this section; and
‘‘(4) other lending policies as defined by the
Board.’’.
SEC. 6. CONSTRUCTION.
Nothing in this Act is intended to modify section
1062(b) of the National Defense Authorization Act for
Fiscal Year 2000 (Public Law 106–65).
SEC. 7. ANNUAL REPORT.
The National Telecommunications and Information
Administration shall submit an annual report to the Com-
mittees on Appropriations and Energy and Commerce of
the House of Representatives, the Committees on Appro-
priations and Commerce, Science, and Transportation of
the Senate, and the Comptroller General on—
(1) the progress made in adhering to the
timelines applicable to relocation from eligible fre-
quencies required under section 118(d)(2)(A) of the
National Telecommunications and Information Ad-
ministration Organization Act, separately stated on
a communication system-by-system basis and on an
auction-by-auction basis; and
(2) with respect to each relocated communica-
tion system and auction, a statement of the estimate
of relocation costs required under section 113(g)(4)
of such Act, the actual relocations costs incurred,
and the amount of such costs paid from the Spec-
trum Relocation Fund.
SEC. 8. PRESERVATION OF AUTHORITY; NTIA REPORT RE-
QUIRED.
(a) SPECTRUM
MANAGEMENT
AUTHORITY
RE-
TAINED.—Except as provided with respect to the bands
of frequencies identified in section 113(g)(2)(A) of the Na-
tional Telecommunications and Information Administra-
tion Organization Act (47 U.S.C. 923(g)(2)(A)) as amend-
ed by this Act, nothing in this Act or the amendments
made by this Act shall be construed as limiting the Fed-
eral Communications Commission’s authority to allocate
bands of frequencies that are reallocated from Federal use
to non-Federal use for unlicensed, public safety, shared,
or non-commercial use.
(b) NTIA REPORT REQUIRED.—Within 1 year after
the date of enactment of this Act, the Administrator of
the National Telecommunications and Information Ad-
ministration shall submit to the Energy and Commerce
Committee of the House of Representatives and the Com-
merce, Science, and Transportation Committee of the Sen-
ate a report on various policy options to compensate Fed-
eral entities for relocation costs when such entities’ fre-
quencies are allocated by the Commission for unlicensed,
public safety, shared, or non-commercial use.
Passed the House of Representatives June 11, 2003.
Attest:
Clerk.