II 113th CONGRESS 2d Session S. 2473 IN THE SENATE OF THE UNITED STATES June 12, 2014 Mr. Rubio introduced the following bill; which was read twice and referred to the Committee on Commerce, Science, and Transportation A BILL To reallocate Federal Government-held spectrum for commercial use, to promote wireless innovation and enhance wireless communications, and for other purposes.

1. Short title; table of contents (a) In general This Act may be cited as the Wireless Innovation Act of 2014 . (b) Table of contents The table of contents for this Act is as follows: Sec. 1. Short title; table of contents. Sec. 2. Findings; statement of policy. Sec. 3. Definitions. Sec. 4. Reallocation of Federal Government spectrum. Sec. 5. Spectrum pipeline. Sec. 6. Reallocation incentive. Sec. 7. Expediting routine secondary market transactions. Sec. 8. Analysis of spectrum requirements. Sec. 9. Federal spectrum transparency and value. 2. Findings; statement of policy (a) Findings Congress finds the following: (1) The United States is the global leader in wireless communications and broadband technologies, both of which are vital parts of daily life in the United States, key components of the national infrastructure of the United States, and a significant driver of the United States economy. (2) Wireless communications and broadband services have become critical for individuals to improve their economic well-being, businesses to compete in the 21st century, first responders to protect individuals in emergencies, and Federal agencies to service their missions, such as national defense. (3) Because of the proliferation of broadband connected wireless devices and consumer applications, the volume of data traffic traveling over wireless networks has been growing substantially, and with the pace of innovation accelerating, the demand for wireless data services will continue to increase exponentially. (4) The Council of Economic Advisors has concluded that the only feasible way to realize the full potential of wireless broadband is to make new spectrum available for wireless services, and considerable spectrum is underused or used in less economically valuable ways, and could be repurposed and reallocated for wireless broadband use. (5) If the United States does not make more spectrum available, scarcity of spectrum could lead to higher prices for wireless services, poor service quality, the inability of the United States to compete internationally, constrained mobile broadband growth, and ultimately, a drag on innovation and individual economic mobility. (6) The National Broadband Plan, created by the Federal Communications Commission, set a goal of making 500 megahertz of spectrum newly available for commercial mobile broadband use by 2020, including making 300 megahertz between 225 megahertz and 3.7 gigahertz newly available for mobile use within 5 years, and stated that reallocating this spectrum where possible for mobile broadband use should be a priority. (7) Reallocating and auctioning spectrum produces multiple benefits. A Federal licensee can upgrade to comparable or superior communications technology, an auction raises money for the United States Treasury, and taxpayers benefit from increased access to, and better use of, spectrum. (8) In addition to reallocating spectrum, the United States should pursue a comprehensive approach to spectrum policy that includes expanding the capacity of wireless networks, promoting secondary spectrum markets, expanding unlicensed networks and Wi-Fi systems, and increasing efficiency and transparency among Federal users. (9) The Federal Government, as the largest user of spectrum, must also promote the efficient use of spectrum resources, and the National Telecommunications and Information Administration must ensure that Federal agencies use this valuable public resource in the most efficient and effective manner possible. (10) The National Broadband Plan states that Federal spectrum users can be more efficient with the airwaves allocated to them by the National Telecommunications and Information Administration, especially as wireless needs and technology evolve over time. (b) Purpose The purpose of this Act is— (1) to pursue comprehensive solutions to expand mobile broadband and utilize wireless services and technologies to create jobs, grow the economy, and improve individual economic mobility; and (2) to ensure that the Federal Government— (A) utilizes its spectrum in the most efficient and effective way; and (B) repurposes spectrum for commercial use wherever possible. 3. Definitions In this Act: (1) Commission The term Commission means the Federal Communications Commission. (2) NIST The term NIST means the National Institute of Standards and Technology. (3) NTIA The term NTIA means the National Telecommunications and Information Administration. 4. Reallocation of Federal Government spectrum Section 113 of the National Telecommunications and Information Administration Organization Act (47 U.S.C. 923) is amended by adding at the end the following: (m) Further reallocation report (1) Report required (A) In general Not later than 1 year after the date of enactment of this subsection, the Secretary shall prepare and submit to the President and Congress a report (referred to in this subsection as the reallocation report ) that identifies and recommends for reallocation bands of frequencies— (i) that, in the aggregate, span not less than 200 megahertz; (ii) that are located below 5 gigahertz; (iii) that are not covered by the proceeding of the Commission in GN Docket No. 12–354; (iv) that, as of the date of submission of the reallocation report, are allocated on an exclusive or primary basis for Federal Government use; (v) from which Federal Government stations may be relocated pursuant to subsection (g) or for which Federal Government stations may be replaced by commercially available substitutes; (vi) that, as of the date of submission of the reallocation report or at any time during the 10-year period beginning on that date, may feasibly be made available for the uses described in subparagraph (B); (vii) the transfer of which from, or the sharing of which with, Federal Government use will not result in costs to the Federal Government, or losses of services or benefits to the public, that are excessive in relation to the benefits to the public that may be provided by non-Federal licensees; and (viii) that are most likely to have the greatest potential economic benefit to the United States if reallocated and licensed for non-Federal use. (B) Allocation of spectrum Of the spectrum described in subparagraph (A)— (i) 140 megahertz shall— (I) be allocated for commercial mobile use on an exclusive, licensed basis; and (II) be located below 3.7 gigahertz; (ii) not more than 20 megahertz may be allocated for unlicensed use if— (I) such use protects licensed services from harmful interference; and (II) the spectrum allocated for such use is located— (aa) in guard bands below 3.7 gigahertz— (AA) that are no larger than technically necessary to prevent harmful interference between licensed services outside the guard bands; and (BB) the unlicensed use of which does not cause harmful interference to licensed services; or (bb) between 3.7 gigahertz and 5 gigahertz; and (iii) not more than 40 megahertz may be shared with Federal Government stations if— (I) the President limits the assignment of the Federal Government stations so that the use of the spectrum by those stations is restricted by geographic area, by time, or by other means so as to guarantee that the continued use by those stations is substantially less than the use made by non-Federal stations; and (II) the operational sharing authorized under this clause is subject to— (aa) interference regulations prescribed by the Commission under section 305(a) of the 1934 Act; (bb) coordination procedures that the Commission and the Secretary shall jointly establish and implement to ensure against harmful interference; and (cc) the sharing arrangements in a transition plan applicable to the spectrum that the Technical Panel finds sufficient under subsection (h)(4). (C) Relocation of Federal Government stations; costs The Secretary shall include in the reallocation report— (i) recommendations for spectrum bands to which Federal Government stations may be relocated; and (ii) the costs, as determined by the Secretary in consultation with the Office of Management and Budget, of the relocation described in clause (i). (2) Direct discussions (A) In general The Secretary shall consult with the Federal Government users of the spectrum and work through established processes of the NTIA to encourage and provide opportunity for direct discussions among commercial representatives and Federal Government users of the spectrum to aid the Secretary in determining which frequencies to recommend for reallocation under this subsection. (B) Notice The Secretary shall provide notice to the public and the Commission of any discussion held under subparagraph (A), including the name of each business or other person represented in the discussion. (C) Representative of commission A representative of the Commission (and of the Secretary, at the election of the Secretary) may attend any discussion held under subparagraph (A). (D) Opportunity for comment Before the Secretary submits the reallocation report, the Secretary shall provide the public and the Commission with an opportunity to comment on the results of any discussion held under subparagraph (A). (3) Timetable for withdrawal or limitation of assignments (A) Recommended deadlines The Secretary shall include in the reallocation report a timetable that recommends effective dates by which the President shall— (i) withdraw the assignment to Federal Government stations of the frequencies specified in the reallocation report (other than the frequencies identified under paragraph (1)(B)(iii)); and (ii) in the case of the spectrum identified under paragraph (1)(B)(iii), limit the assignment of that spectrum to Federal Government stations as required under subclause (I) of that paragraph. (B) Absolute deadlines (i) In general Notwithstanding the effective dates recommended by the Secretary under subparagraph (A), not later than the date described in clause (ii) of this subparagraph, the President shall— (I) withdraw the assignment to Federal Government stations of the frequencies specified in the reallocation report (other than the frequencies identified under paragraph (1)(B)(iii)); and (II) in the case of the spectrum identified under paragraph (1)(B)(iii), limit the assignment to Federal Government stations as required under subclause (I) of that paragraph. (ii) Date The date described in this clause is the earlier of— (I) the date that is 3 years after the beginning of the auction of the frequencies specified in the reallocation report pursuant to section 309(j)(15)(C)(vii) of the 1934 Act; or (II) the date as of which— (aa) each Federal Government station has been relocated from the frequencies specified in the reallocation report (other than the frequencies identified under paragraph (1)(B)(iii)); and (bb) the assignment of the frequencies identified under paragraph (1)(B)(iii) to each Federal Government station has been limited as required under subclause (I) of that paragraph. (4) Department of Defense stations Section 1062(b) of the National Defense Authorization Act for Fiscal Year 2000 ( Public Law 106–65 ; 113 Stat. 768) shall apply to the relocation of stations operated by the Department of Defense in the spectrum described in paragraph (1)(A) of this subsection. . 5. Spectrum pipeline (a) Deadline Section 309(j)(15)(C) of the Communications Act of 1934 ( 47 U.S.C. 309(j)(15)(C) ) is amended by adding at the end the following: (vii) Deadlines for the auction of frequency bands under the Wireless Innovation Act of 2014 The Commission shall conduct an auction of— (I) 80 megahertz of the spectrum recommended for reallocation in the reallocation report under section 113(m) of the National Telecommunications and Information Administration Organization Act not later than December 31, 2018; (II) an additional 60 megahertz of the spectrum recommended for reallocation in the reallocation report described in subclause (I) not later than 18 months after the completion of the auction required under subclause (I); and (III) an additional 40 megahertz of the spectrum recommended for reallocation in the reallocation report described in subclause (I) not later than 18 months after the completion of the auction required under subclause (II). . (b) Regulations Not later than 6 months before the Commission commences each auction required under section 309(j)(15)(C)(vii) of the Communications Act of 1934, as added by subsection (a), the Commission shall promulgate regulations necessary to conduct the auction. (c) Technical and conforming amendment Section 6401(b)(2) of the Middle Class Tax Relief and Job Creation Act of 2012 (47 U.S.C. 1451(b)(2)) is amended— (1) by striking subparagraph (C); and (2) by redesignating subparagraphs (D) and (E) as subparagraphs (C) and (D), respectively. 6. Reallocation incentive (a) Definitions In this section— (1) the term Director means the Director of the Office of Management and Budget; and (2) the term Federal entity has the meaning given the term in section 113(l) of the National Telecommunications and Information Administration Organization Act ( 47 U.S.C. 923(l) ). (b) Deposit of proceeds Notwithstanding section 309(j)(8)(D) of the Communications Act of 1934 ( 47 U.S.C. 309(j)(8)(D) ), if the first 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) ) that takes place after the date of enactment of this Act meets the requirements established under section 309(j)(16) of the Communications Act of 1934 (47 U.S.C. 309(j)(16)), an amount equal to 1 percent of the proceeds attributable to the auction shall be deposited in the Spectrum Relocation Fund established under section 118 of the National Telecommunications and Information Administration Organization Act ( 47 U.S.C. 928 ) for use in accordance with subsection (c) of this section. (c) Payments for advance planning and enhanced spectrum efficiency (1) In general The Director, in consultation with the NTIA, may use the amount made available under subsection (b) to make payments to any Federal entity— (A) to conduct research and development, and operational, technical, cost, and schedule-feasibility analyses, regarding the potential future reallocation of additional spectrum from Federal use to exclusive non-Federal use or to shared use; and (B) to develop and incorporate spectrum efficiency guidelines and spectrally efficient advanced or unique technology or techniques into the budget and procurement processes of the Federal entity to facilitate the design and procurement of Federal spectrum-dependent systems that increase flexibility through means such as multiple-band tuning capabilities and the use of commercial systems as appropriate, including through public-private partnerships. (2) Conditions (A) Use of payment to estimate costs A Federal entity that receives a payment under subparagraph (A) of paragraph (1) to conduct the analyses described in that paragraph shall use the payment to estimate the costs specified in clauses (i) through (v) of section 113(g)(3)(A) of the National Telecommunications and Information Administration Organization Act ( 47 U.S.C. 923(g)(3)(A) ) with respect to frequencies identified by the Federal entity for potential reallocation. (B) Relocation or sharing costs The Director may not make a payment under paragraph (1) if the amount made available under subsection (b) is otherwise necessary to cover relocation or sharing costs (as defined in section 113(g)(3)) of the National Telecommunications and Information Administration Organization Act ( 47 U.S.C. 923(g)(3) )). (C) Notification required The Director may not make a payment under paragraph (1) until 30 days after the date as of which the Director has notified the Committee on Commerce, Science, and Transportation of the Senate and the Committee on Energy and Commerce of the House of Representatives of the intent of the Director to make the payment. (D) Emission levels A Federal entity that receives a payment under paragraph (1) shall, to the extent possible, procure systems described in subparagraph (B) of that paragraph such that emission levels resulting from reasonable use of adjacent spectrum will not impair the functioning of the systems, consistent with any applicable radio receiver performance criteria and international obligations. (3) Annual report Each year, the Director shall submit to the Committee on Commerce, Science, and Transportation of the Senate and the Committee on Energy and Commerce of the House of Representatives a report that— (A) describes each payment that the Director made to a Federal entity under this subsection during the preceding year; and (B) details how each Federal entity used each payment described in subparagraph (A). 7. Expediting routine secondary market transactions Section 310 of the Communications Act of 1934 ( 47 U.S.C. 310 ) is amended by striking subsection (d) and inserting the following: (d) Assignment and transfer of construction permit or station license (1) In general (A) Application required No construction permit or station license, or any rights thereunder, shall be transferred, assigned, or disposed of in any manner, voluntarily or involuntarily, directly or indirectly, or by transfer of control of any corporation holding such permit or license, to any person except upon application to the Commission and upon finding by the Commission that the public interest, convenience, and necessity will be served thereby. (B) Action upon application Any application under subparagraph (A) shall be disposed of as if the proposed transferee or assignee were making application under section 308 for the permit or license in question; but in acting thereon the Commission may not consider whether the public interest, convenience, and necessity might be served by the transfer, assignment, or disposal of the permit or license to a person other than the proposed transferee or assignee. (2) Presumption An application to the Commission under paragraph (1) shall be deemed to be in the public interest, convenient, and necessary, and shall be granted not later than 90 days after the date on which the Commission issues a public notice of the application, unless the Commission acts to deny the application, if the application— (A) does not involve an entity described in subsection (b); (B) does not require premerger notification and waiting period under section 7a of the Clayton Act (15 U.S.C. 18a); and (C) is not a covered transaction under section 721 of the Defense Production Act of 1950 (50 U.S.C. App. 2170). . 8. Analysis of spectrum requirements Section 104(d) of the National Telecommunications and Information Administration Organization Act ( 47 U.S.C. 903(d) ) is amended— (1) in paragraph (1)— (A) by striking In assigning and inserting the following: (A) In general In assigning ; and (B) by adding at the end the following: (B) Required analysis Before the Secretary may assign frequencies for mobile radio services and other radio services, and subject to subparagraph (C), each Federal agency seeking a new or modified frequency assignment for a mobile service or other radio service shall submit to the Secretary and the Director of the Office of Management and Budget (referred to in this paragraph as the Director ) a report analyzing— (i) whether the Federal agency may use commercial services for the operation of the service rather than obtain a new or modified frequency assignment consistent with national security, public safety and overall ability to reliably perform the Federal mission, including an explicit consideration of the cost of contracting for the commercial service against the cost of the agency operating on the new or modified frequency assignment; (ii) whether the proposed spectrum requirements of the Federal agency could— (I) use an existing or planned service operated by the Federal agency or another Federal agency; or (II) share a frequency allocation with an existing Federal agency, including the use of dynamic and opportunistic spectrum sharing; (iii) whether the Federal agency could— (I) use unlicensed spectrum; or (II) lease capacity from commercial providers; (iv) if the Federal agency cannot use a commercial or other Federal service, how much spectrum the Federal agency needs to operate the service; (v) whether the service requires a frequency assignment below 3 gigahertz; and (vi) whether, once the allocation is made, the Federal agency may share the spectrum with non-Federal users. (C) Review of analysis (i) In general The Secretary, in consultation with the Director and any Federal agency that the Secretary may determine appropriate, shall determine whether to grant a request of a Federal agency for a new or modified frequency assignment for a mobile service or other radio service. (ii) Alteration of allocation If the Secretary determines that a request described in clause (i) is better met through sharing frequencies or systems with another Federal agency, the Secretary, in consultation with the Director, the requesting Federal agency, the Federal agency with whom the requesting Federal agency will share systems or allocation, and any other Federal agency that the Secretary may determine appropriate, shall alter the previously granted allocation accordingly. (D) Budget and procurement processes (i) In general A Federal agency shall include spectrum efficiency when considering procurement of spectrum-dependent systems and hardware, as a technical requirement, an evaluation criterion for award, or both. (ii) Spectrum efficiency guidelines The NTIA and the Director shall develop and incorporate spectrum efficiency guidelines into budget and procurement processes. (iii) Purpose and content of guidelines The guidelines developed under clause (ii) shall— (I) facilitate, as appropriate, the design and procurement of systems that increase flexibility through means such as multiple-band tuning capabilities and the use of commercial systems; and (II) require, to the extent possible, procurement of Federal systems such that emission levels resulting from reasonable use of adjacent spectrum will not impair the functioning of such systems, consistent with any applicable radio receiver performance criteria and international obligations. (E) Transparency of Federal spectrum allocations (i) Public availability All requests for allocation made under this Act shall be published in the Federal Register. (ii) Database The NTIA shall maintain a database of all requests for allocation made under this Act that is searchable electronically and available to the public. (iii) Public comment permissible At the discretion of the Secretary, the Secretary may seek public comment on any requested allocation. (iv) National security protected Where necessary to protect the interests of national security, the Assistant Secretary shall redact a request for allocation made under this Act from the public. ; and (2) in paragraph (2), by striking The Secretary and inserting In addition to the circumstances described in paragraph (1)(C), the Secretary . 9. Federal spectrum transparency and value (a) Analysis of economic opportunity cost (1) Development of framework Not later than 1 year after the date of enactment of this Act, the NTIA, in consultation with the Commission and the Director of the Office of Management and Budget, shall develop a framework for determining the annual economic opportunity cost of each specific Federal spectrum band assigned or otherwise allocated for use by Federal entities. (2) Scope The framework developed under paragraph (1) shall cover all federally allocated spectrum bands between 150 megahertz and 6000 megahertz, inclusive. (3) Goals The goals of the framework developed under paragraph (1) are— (A) to provide Federal entities with a sustained long-term signal of spectrum value to inform the spectrum management decisions of such entities; and (B) to provide the public with increased transparency about how Federal entities use a scarce physical resource. (4) Requirements The framework developed under paragraph (1) shall— (A) define the term opportunity cost as the value of the spectrum, in dollar terms, as if such spectrum were to be reallocated on a licensed basis to the highest commercial alternative use that currently does not have access to that spectrum; (B) be updated, on an annual basis, to take into account observed market valuations from spectrum auctions, secondary spectrum trading, and other market indicators of spectrum value; (C) determine the opportunity costs borne by each Federal entity for each spectrum band that is entirely under the control of a single agency; and (D) determine the opportunity costs for spectrum assigned or otherwise allocated to Federal entities for both primary use and secondary use. (b) Report on opportunity costs Each Federal entity that has been assigned or otherwise allocated use of a Federal spectrum band shall report, as an off-budget item, the opportunity cost borne by the entity for each spectrum band the entity uses— (1) in the budget of the entity to be included in the budget of the United States Government submitted by the President under section 1105 of title 31, United States Code; and (2) in the annual financial statement of the Federal entity required to be filed under section 3515 of title 31, United States Code. (c) Spectrum value analysis Not later than 5 years after the date of enactment of this Act, and every 5 years thereafter, each Federal entity that has been assigned or otherwise allocated use of a Federal spectrum band, or otherwise utilizes such spectrum, shall engage in an analysis comparing the opportunity cost of that spectrum, as such cost is determined by the framework developed by the NTIA under subsection (a), to the projected costs of the entity relocating to other government spectrum holdings, co-locating with other government agencies, leasing other non-Federal spectrum, or contracting out for its spectrum activities. (d) Spectrum technology study (1) In general Not later than 18 months after the date of enactment of this Act, and every 5 years thereafter, the Chief Technology Officer, in consultation with the Assistant Secretary of Commerce for Communications and Information and the Comptroller General of the United States, shall examine the technologies and equipment used by Federal entities operating on Federal spectrum allocations and determine if such technologies and equipment are the most spectrum-efficient available. (2) Certain determinations made If the results of any study required under paragraph (1) determine that the technologies and equipment of Federal entities operating on Federal spectrum allocations are not the most spectrum-efficient available, the Comptroller General shall determine— (A) what the costs would be to upgrade such systems to more up-to-date and readily available systems; (B) what benefits would be gained from upgrading, particularly any cost savings or increases in spectrum utilization efficiency; and (C) if there are any possible problems with upgrading to more up-to-date systems. (e) Spectrum opportunity cost and framework study (1) In general The Comptroller General of the United States, in consultation with the NTIA, shall— (A) conduct a review of the framework developed under subsection (a); (B) conduct a review of the reports required under subsection (b) and the processes that Federal entities use to evaluate the opportunity cost borne for each spectrum band the Federal entities use; and (C) make recommendations on how to improve such framework and reporting. (2) Report Not later than 2 years after the date of enactment of this Act, and every 2 years thereafter, the Comptroller General of the United States shall submit to the appropriate committees in Congress a report on the review and recommendations required under paragraph (1).