The First Responder Network (FirstNet) and Next-Generation Communications for Public Safety: Issues for Congress
Released: 2017-01-26T00:00:00

Introduction

The First Responder Network Authority (FirstNet) is a federal agency that includes private sector and other non-federal representation on its board of directors. FirstNet was created by Congress with provisions in Title VI (Spectrum Act) of the Middle Class Tax Relief and Job Creation Act of 2012 ( P.L. 112-96 ) to ensure the deployment and operation of a nationwide, broadband network for public safety communications. It is established as an "independent authority" within the National Telecommunications and Information Administration (NTIA), part of the Department of Commerce.

In addition to establishing the structure and goals for FirstNet, Congress provided $7 billion for costs related to planning and deploying the broadband network, and a $135 million grant program to assist states with plans to connect to FirstNet's broadband network. These funds are provided from revenue realized through auctioning licenses for radio frequency spectrum, as designated in the act. The anticipated cost of building and operating a nationwide core broadband network—and the interoperable radio networks that connect to it—is significantly in excess of the amount appropriated. The act therefore provides for public-private partnerships with FirstNet or with states, and for fees (charged to states and other users) to ensure that FirstNet becomes self-sustaining. To attract private sector partners, FirstNet can offer access to its assets, including radio frequency spectrum capacity, in return for financial payment or other support. FirstNet holds a license for 20 MHz of broadband spectrum, assigned by the Federal Communications Commission (FCC), as required by the act. The act allows states that meet specified requirements to lease spectrum from FirstNet and thereby negotiate their own partnerships that share spectrum in Radio Area Networks for their state or region. The act requires that FirstNet deploy its network using the fourth-generation wireless technologies of Long Term Evolution (LTE). LTE is a powerful cellular technology with industry standards that are consistently being upgraded to expand its capabilities. LTE is also a platform for commercial carrier-expansion into fifth-generation (5G) wireless communications and the Internet of Things.

There are many challenges for public safety leaders and policymakers in establishing the framework for a nationwide network that meets state, local, tribal, and territorial needs for robust, interoperable emergency communications. Currently, for example, state emergency communications needs are typically met by separate networks using different technologies. Furthermore, each state has its own laws and procedures for building, managing, and funding communications infrastructure. Among the challenges facing FirstNet is establishing a governance model that accommodates current investments and future needs of its clients without compromising the coherence of a national network.

The Request for Proposal and Latest Developments

FirstNet officials face enormous pressure to produce a functional network in a timely manner, reflecting widespread concerns that public safety communications will not be adequate for response and recovery if a catastrophic national emergency occurs. Among the timelines that the winning bidder must meet is geographical coverage for 95% of the country within six months of receiving the contract. This obligation suggests that participation of one of the four nationwide carriers (Verizon, AT&T, Sprint, T-Mobile) to carry FirstNet traffic will be essential, even if the carrier acts as a subcontractor and not a lead partner. Agreements with rural carriers may also be used to meet rural coverage goals. The winning contractor must guarantee priority access to public safety on the 20 MHz of spectrum capacity that FirstNet brings to the table. The requirements for buildout using FirstNet spectrum (referred to as Band 14) are 20% coverage of population within the first year of operation and 60% coverage within two years.

Also within six months, the winning contractor is expected to submit simultaneously to 56 states and territories, as required by the act, a plan for how FirstNet would be deployed within that state or territory (tribal areas are covered in state plans). FirstNet will make available $6.5 billion of its federal funding for the buildout. The bidder must indicate the cost of each state's buildout within the context of its cost model. States that successfully meet the criteria to build their own network within FirstNet will be eligible for a proportionate share of the $6.5 billion, provided in the form of a grant. The total cost to build out the network is estimated by most experts to be in excess of $30 billion over 10 years.

The successful bidder will sign a contract for 25 years, expiring in FY2042. Annual payments totaling at least $5.625 billion over the period of the contract are required as a guarantee that FirstNet will be financially self-sustaining.

On October 17, 2016, two of the bidders—Rivada Mercury and pdvWireless—were informed by the U.S. government that their proposals had been eliminated from consideration. This leaves AT&T as the one publically known bidder still in consideration.

On November 21, 2016, Rivada Mercury filed a lawsuit against the U.S. government in the U.S. Court of Appeals of Federal Claims over what Rivada says is the illegal and wrongful exclusion of the consortium from the FirstNet procurement process. The lawsuit is expected to delay the contract award until March 1, 2017, at the earliest, although further delays are possible depending on the resolution of the lawsuit.

FirstNet Network Strategy

Achievements since the FirstNet board first met officially in September 2012 include a number of Requests for Information (RFI), notably the September 2014 Request for Information for Comprehensive Network Solution(s). This document proposed a comprehensive broadband network solution for FirstNet that would reach from core network management requirements to include local area networks in many communities, as well as some devices used to access the network. A Second Notice , issued by the Department of Commerce for comment on March 9, 2015, provided FirstNet's perspective on the intent of Congress in enacting language that allows states to build their own networks. The discussion in the Second Notice also supplemented the Public Notice on Statutory Interpretations , issued in September 2014. A number of important issues are raised in these formal statements of proposed interpretation, including possible definitions of "public safety" and "rural."

A third public notice concerning the definition of "public safety" was released after a FirstNet board meeting on April 24, 2015. Also on April 24, the proposed acquisition approach and the draft Request for Proposal(s) (RFP) were considered in a closed meeting. The draft RFP builds on proposals from previous notices and RFIs. The planning process for 2015-2016 centered on circulating the draft Request for Proposal(s) and a final RFP. FirstNet concluded that the contract or contracts would be awarded through the Federal Acquisition Regulation (FAR) process.

According to FirstNet, "key goals are to meet the needs of public safety and to provide extensive coverage so Federal subscribers and other public safety users can count on the network when they are on the job." Network coverage includes deployable units, such as vehicles equipped to connect with the network, and local area networks operated by FirstNet. "Incident commanders and officials will have local control over the network so, for example, they can assign users and talk groups and determine who can access applications." The underlying premise of the strategy is that the chosen network solutions will allow FirstNet to "control and operate" national and regional core network infrastructure, Radio Access Networks (RANs) in states that opt in, as well as devices, applications, and other functions. To achieve this level of coverage, FirstNet's "acquisition strategy centers on maximizing the network's value to public safety while meeting its financial sustainability obligations under the Act."

Network Design

Although many details have not been made public, the general architecture of FirstNet's broadband network has been presented at numerous public events and is available on the FirstNet website. The network design shows what is referred to as a heterogeneous network, or HetNet. It depicts the Radio Access Network to include both macro and micro networks. In simple terms, high towers with base stations, known as eNodeB in LTE network design, are referred to by the wireless industry as a macro network; a variety of small cell network designs are referred to as micro networks. The macro network is often described as providing coverage over distance and the micro network as providing capacity as well as extra coverage at the local level.

The trend in the evolution of network coverage is depicted in Figure 1 . In this configuration, the micro network has become the predominate provider of mobile communications coverage and capacity through contiguous small cell networks. The tower of the macro network (eNodeB) assures nationwide connectivity and provides additional coverage. Small cell networks are by and large autonomous, providing coverage for their area and connecting to other small cell networks or cellular towers when needed. These micro networks are local in nature but fully interoperable across wide geographic areas. For FirstNet, a network strategy that shifts the majority of routine, public safety mobile communications onto shared spectrum in small cell networks will free much of the 20 MHz spectrum license for secondary use by commercial carriers. Only in times of a major emergency would public safety users make heavy demands on the macro network and spectrum licensed to FirstNet.

In an LTE network, it is the eNodeB macro coverage infrastructure—not the micro network—that requires a significant spectrum assignment to operate efficiently. During the period 2011-2012, when the Spectrum Act was drafted and enacted, the Radio Area Network would have consisted primarily of high-site towers with base stations (eNodeB). Since the Spectrum Act was passed, communications technologies have evolved in ways not fully anticipated at the time. Congress, therefore, may have assumed that a state with a successful plan to opt out and create its own public-private partnership would be granted a statewide license for 20 MHz to operate a Radio Area Network using eNodeB towers and base stations. Micro networks, however, can operate within the 20 MHz assignment, essentially sharing the spectrum, but may require no more than 1.5 x 1.5 MHz for a basic LTE network. Therefore, if FirstNet decides that only micro network capacity will be made available for a state-operated Radio Area Network, then the state will have a sub-license for a relatively small amount of spectrum that may be difficult—perhaps impossible—to leverage in a public-private partnership.

State Public Safety Radio Networks

Since September 11, 2001, state and local agencies—aided by federal grant programs—have invested in improving the reliability and interoperability of mission critical voice communications over Land Mobile Radio (LMR) networks. The 2014 National Emergency Communications Plan prepared by the Department of Homeland Security emphasizes the need to continue investment in these networks to provide communication for first responders until such time as FirstNet is deployed and capable of handling mission-critical voice communications over broadband. These networks may also be essential for local and state backup service when access to FirstNet has been preempted by a large-scale emergency, or they may be an alternative to using FirstNet.

State Participation: The Opt-Out Provision

FirstNet is required to consult with regional, state, tribal, and local authorities regarding decisions such as those concerning the costs of the policies it formulates, as required in the law, including expenditures for the core network, placement of towers, coverage areas, security, and priority access for local users. Consultation will be through a state-selected coordinator as specified in the act. Appointment of an individual or governmental body as the Single Point of Contact (SPOC) is required as a condition of state participation and eligibility to receive grants established by the act.

Every state has one or more agencies that plan for public safety, homeland security, and emergency communications. To be eligible for grants from the Department of Homeland Security, a state establishes a Statewide Interoperability Coordinator (SWIC) to administer its Statewide Communication Interoperability Plan (SCIP). SCIPs are written to conform with federal guidelines and requirements, such as the National Emergency Communications Plan. States may decide to use the existing SWIC as the required single point-of-contact or may choose to appoint a separate coordinator. Each state and other participants have appointed a coordinator to work directly with FirstNet. The coordinator (SPOC) is responsible for managing FirstNet activities in his or her state. Often this includes revising the existing SCIP to include broadband communications.

The governor of each state is to be notified by FirstNet when it has completed its requests for proposals regarding construction, operation, maintenance, and improvement of a nationwide network. The governor or his designee will receive the details of the proposed plans and notification of the amount of funding available to the state if it participates in the FirstNet program.

The act only identifies two options for a state: join FirstNet or build a statewide Radio Access Network subject to the provisions of the act. The act does not include specific provisions for a state that chooses to build its own Radio Access Network without opting out of FirstNet, although providing such an option may be within FirstNet's charter. A state might, for example, choose to build its own data management center or mobile access routers while also sharing FirstNet's infrastructure for regional and national coverage. The act also is silent on whether states may choose to opt out of the broadband network entirely, choosing neither to join FirstNet nor to build a broadband network on the frequencies assigned to FirstNet. Some states may prefer to concentrate their resources on improving mission-critical voice networks and acquire broadband access from a commercial provider or through other means. FirstNet, through its partners, intends to provide service in all states, even if a state chooses not to be a customer or otherwise participate in the network.

The Spectrum Act specifies that a state that chooses to build its own Radio Access Network must submit an alternative plan for construction, operation, maintenance, and improvement of the Radio Access Network within the state. The state has 90 days to agree to participate or to notify FirstNet, the NTIA, and the FCC of its intent to deploy its own part of the Radio Access Network, and an additional 180 days to provide its plan to the FCC. The state must demonstrate to the FCC, which the law requires to review the plan, that its planned Radio Access Network would comply with minimum technical requirements and be interoperable with FirstNet.

If a state's plan is approved it will be eligible to apply for a grant, administered by the NTIA, that will be funded from the Network Construction Fund created by the act. The amount available may be less than what would have been provided if the state had opted in to the FirstNet program, because the grant will be applied only toward building the Radio Access Network and may be subject to matching grant requirements. Approval of the grant is contingent on meeting additional requirements established by the NTIA, including sustainability, timeliness, cost-effectiveness, security, coverage, and services that are comparable to FirstNet. The state would be required to pay a user fee for access to FirstNet's core network. It would not be permitted to enter commercial markets or lease access to its network except through a public-private partnership. FirstNet has determined that any revenue to the state from a partnership must be used only for costs associated with its participation in FirstNet. If a state's plan meets FCC and NTIA requirements, then the NTIA may approve lease authority for FirstNet to grant a sub-license to a state, to operate on some portion of the FirstNet spectrum.

On July 19, 2016, the NTIA published notice of its proposal for evaluating State Alternative Plan Programs for states that wish to opt out of FirstNet. If a state's plan has met the initial approval of the FCC, it must then demonstrate to the NTIA that it meets technical and financial requirements. To the general parameters provided in the Spectrum Act, the NTIA has added several specific criteria for states that parallel requirements for contractors, including:

The State Alternative Plan Proposal submission and the related request for a spectrum lease will be treated as a single request for a grant (even though the state may choose not to request a grant as described in the Spectrum Act) in accordance with provisions of the Federal Grants and Cooperative Agreement Act of 1977 ( P.L. 95-224 ). The forthcoming Federal Funding Opportunity announcement will include additional details regarding the technical capabilities required of a state, in addition to those published in the July 19 notice. States must submit their application to the NTIA within 60 days of FCC approval of the alternative plan. State network plans must adhere to the same policies as those applied to FirstNet. States will be required to provide information on how it will manage its Radio Access Network, including, for example, its staffing plan and budget documents. States must disclose partnership agreements and address funding risks; NTIA may require surety bonds to ensure network construction is completed. Deadlines for the state plan must match those presented in FirstNet's plan for the state. A state plan that relies on new buildouts of the network ("greenfield") might not qualify as cost effective. In evaluating the cost-effectiveness of a state's alternative plan, NTIA will include as a factor its assessment of the value of cross-border economies of scale that may be lost.

State and Community Network Participation

The following discussion focuses on key statements from FirstNet that seem to indicate the agency's current plans for state, tribal, territorial, and local participation in the network. FirstNet may later choose to alter its plans.

FirstNet's deployment strategy reportedly will

Include state-based eNodeB's in FirstNet's core services, thereby bringing the entire 20 MHz spectrum license under the full control of FirstNet and its federal contractors. This decision, if implemented, represents a change in an earlier statement that proposes including the eNode B as part of the Radio Area Network. Provide local area network capacity and connections as an extension of FirstNet, limiting state authority to providing fill-in capacity for some under-served areas. Assign to FirstNet contractors the responsibility of identifying additional partners or subcontractors to act under the authority of the contractor; this might include, for example, negotiating an agreement with a local power company for access to its infrastructure. Assign negotiations for access to existing state, local, or tribal infrastructure to contractors, to be pursued after the contract has been issued. Extend coverage to rural areas where there is currently little or no commercial service through new, federally funded build-out to the commercial networks of partners chosen through the RFP process.

A major goal of this network design is to maximize the value of spectrum by capturing its full value, nationwide, in order to provide sufficient funding for rural coverage. FirstNet therefore believes that allowing states to build their own RANs "potentially takes with it subscriber fees and/or excess network capacity fees that would have helped fund the FirstNet network in all other states."

Apparently not included in FirstNet's planning process is an analysis of the costs to be assumed by states as a consequence of its business plan. These costs include the continued operation and possible expansion of state and local LMR voice networks; the cost of integration of LMR and broadband infrastructure; the costs of forfeiting to FirstNet the potential economies of scale in network construction and operation; and the cost of lost opportunities for competition and innovation in wireless services at the state and local level. It remains to be seen what the winning contractor to deploy FirstNet will offer to states to offset costs that states are likely to bear in order to participate in FirstNet.

Risks and Rewards

FirstNet appears to be making decisions about the network design that are evolving as new information is gathered and analyzed. It claims that a federalized network is the "only solution" that meets its goals of providing nationwide coverage, interoperability, and assured access. In the Second Notice it concludes that allowing populous states to opt out of FirstNet and build their own public safety broadband networks, monetizing the value of the 20 MHz of spectrum assigned for that purpose, will beggar their more rural neighbors who cannot so readily capture the value of excess capacity. This is a presumption of market failure that is not supported by information made public by FirstNet and is inconsistent with the many positive analyses of the economic value of small cell networks, community broadband, and the Internet of Things.

The value of economies of scale in building and operating wireless networks has long been recognized by telecommunications experts and policymakers. The FCC, for example, has modified its policies to make it easier for wireless companies to expand through mergers and acquisitions in order to benefit from scale economies. These and related FCC decisions are based on, among other considerations, improving coverage through macro networks to customers for wireless services. When FirstNet refers to the importance of economies of scale, it is apparently referring to geographic coverage through macro networks.

The economics for small cell networks, however, enable profitability by providing economies of scope, with many different types of services to multiple customer segments in a small area. Economies are provided not through macro network coverage but by micro network capacity to accommodate many customers with different technology needs. Many wireless network experts believe that dense deployments of small cells in an area served by a single eNodeB tower will increase efficiency and reduce costs while increasing capacity to handle many different markets.

Although urbanized areas are seen by many as the primary market for expanding small cell services, the benefits may also be important in rural or remote areas. Experts suggest that, in addition to serving public safety, a rural small cell configuration could support, for example, transportation improvements, education, job search, agricultural and forestry management, new efficiencies in municipal government and services, and economic growth. Economies of scale at the macro level may also be available in states with a low population density. A cost-effective network solution may be achieved by adjacent states combining their resources to provide coverage with eNodeBs and maximizing the utility of small cell networks at the local level. For state and local public safety agencies, maximizing the value of spectrum may be less important than achieving sufficient levels of scale and scope to meet their requirements.

FirstNet refers to the need to monetize the value of its spectrum holdings to expand coverage, based on the existing commercial footprint for LTE, not the footprint of statewide or local public safety networks. It does not estimate the value to states and communities of small cell networks and the wireless component of community broadband that may be transferred to FirstNet's commercial partners. FirstNet's plans appear to capture for its own use most of the value of spectrum used to provide both coverage and capacity. This value is unknown but potentially far greater than what FirstNet can lawfully spend on improving its network or by reducing user fees. The excess value of the spectrum and access to local markets that FirstNet is using to barter for goods and services, therefore, will in most cases go to FirstNet's contractual partners, not to the states and communities intended by the act to be the primary beneficiaries of FirstNet's actions. Economists might describe this as a monopoly surplus.

Advantages of FirstNet's Comprehensive Network Strategy

Advantages of a federalized network, cited by FirstNet, include

Swift execution. Adding public safety access to existing commercial LTE infrastructure provides a turn-key solution for immediate access to a potentially large number of public safety agencies, federal agencies, and others; Extension of LTE service to rural areas that currently have no commercial broadband service and might not have public safety communications coverage; Streamlined access for federal partners. Instead of negotiating with each state or regional network, federal agencies need only negotiate with FirstNet to gain immediate access to the entire network; National reach in times of emergency and assured access to federal incident commanders and officials; Economies of Scale. FirstNet requires full control of many assets in order to maximize their value throughout the network; and Sustainability. Development of small cell networks under FirstNet's control allows for most traffic to be off-loaded onto local networks that require minimal spectrum, freeing spectrum for customers with a higher dollar-value for FirstNet.

Other Advantages

A number of advantages offered by FirstNet could be available in many other governance or business models. These include

Operation of core network (Evolved Packet Core) services such as enforcement of rules for interoperability and other policies and rules, operations, performance and security management, and subscriber databases; Purchasing power. Negotiated discounts for equipment through buying cooperatives; Research and development, standardization, and negotiations with standards bodies; Widespread adoption of broadband technologies to improve, enhance, and extend the effectiveness of emergency responders; and Development of best practices for cybersecurity and enforcement of network security procedures.

Disadvantages of FirstNet's Comprehensive Network Strategy

Some disadvantages of a federalized network might be

Loss of state autonomy. States have a consultative role but many decisions rest with FirstNet. States also lose control of spectrum assets, potentially limiting their ability to develop capabilities and services that are of value to them but not to FirstNet's customers for nationwide service; Devaluation of state and federally funded investments in existing public safety communications networks. Although contractors may, after receiving a contract, negotiate with states and localities for access to their assets, the value and availability of those assets have not been openly stated in the FirstNet planning process; Displacement of local competitors by the FirstNet contractor in local and state broadband development. Smaller communities may not be able to generate sufficient business for two or more broadband service providers. To achieve financially viable programs, they might be restricted to using the incumbent (FirstNet) provider; Displacement of partners for broadband development. Desirable partners (such as a rural utility) may not be available for local projects because of contractual obligations to FirstNet; Loss of market power for state public safety customers. If fees from state and local public safety agencies are a small part of FirstNet's revenue stream, states lose some of their bargaining power in negotiating for improved services or other requests; and Increased risk through lack of diversified assets. Risks include operational risks such as a system-wide failure or cyberattack; financial risks such as monopoly pricing; competitive risks in some markets controlled by FirstNet contractors that may lead to reduced innovation; and the risk of poor management decisions with system-wide impact.

State reactions in weighing risks and rewards of network participation may lead to another risk: limited participation, negating much of the intended value of FirstNet.

NTIA Grant Programs

The NTIA, in consultation with FirstNet, has responsibility for carrying out two grant programs: the State and Local Implementation Grant Program (SLIGP); and grants from the Network Construction Fund to states that are permitted to build their own Radio Access Networks.

State and Local Implementation Grant Program

The State and Local Implementation Fund was allocated $135 million from the Public Safety Trust Fund for grants to be made available to all 56 states and territories to develop a plan on how to use a nationwide public safety broadband network to meet their emergency communications needs. The distribution of available funds among the states is established by the NTIA, which administers the State and Local Implementation Grant Program in consultation with FirstNet. The program is conceived as a matching grant program. Federal grants from the fund are not to exceed 80% of the projected cost to the state; however, the NTIA may make the decision to waive the matching funds requirement.

The NTIA decided to plan for funding in two phases. Grants for both phases totaled over $116 million. Grants for the initial phase were awarded to 54 of the 56 eligible states and territories in FY2013. The state of Mississippi and the territory of the Northern Mariana Islands did not receive grants. The first phase of funding, totaling about $58 million, has helped states conduct outreach with public safety and state and local officials to determine their needs, gaps, and priorities for public safety wireless broadband and to prepare for formal consultations with FirstNet. Grants in the second phase may be used by states to collect data identifying and prioritizing where public safety broadband coverage is needed; identifying potential users and their capacity needs; detailing current providers and procurement mechanisms; and similar needs. Reportedly,

NTIA has recently decided no federal grant monies (SLIGP) can be used to explore any option other than "opt in". FirstNet itself recently asked for review of its interpretations of the Law ("second notice"), and those interpretations also tend to restrict the ability of states to explore options to build their own. It is clear NTIA does not want states doing coverage and financial modeling, even though such work would result in improved FirstNet plans for each state.

The second phase of grants, also for $58 million, was announced in 2015. Awards went to states to collect data identifying and prioritizing where coverage is needed and identifying potential users and other information to facilitate network deployment.

Network Construction Fund

The Spectrum Act requires that $7 billion, reduced by the amount needed to establish FirstNet, be available for a Network Construction Fund established in the Treasury to be used by FirstNet for costs associated with building the nationwide network and for grants to states that qualify to build their own networks. The amount to be made available for the fund has been set at $6.5 billion by FirstNet and the NTIA.

The act effectively creates three types of expenditures from the Network Construction Fund but does not specify how funds would be allocated for (1) expenditures by FirstNet on construction, maintenance, and related expenses to build the nationwide network required in the act; (2) by the NTIA to make payments to states that are participating in FirstNet; and (3) by the NTIA for grants to those states that qualify to build their own Radio Access Networks.

GAO Study

The Spectrum Act requires that, before the end of FY2022, the Government Accountability Office (GAO) is to recommend to Congress what actions should be taken in regard to the ending of FirstNet's authority, mandated to occur in 2027. Additionally, at the request of the Senate Committee on Commerce, Science, and Transportation, GAO has prepared an evaluation of FirstNet's organization, including business decisions contained in the request for proposal; use of commercial, federal, state, local, and tribal infrastructure in deploying the network nationwide; and financial sustainability. GAO presented preliminary findings as testimony at a Commerce Committee hearing on March 11, 2015, and issued a final report on some of these issues on April 28, 2015.

In testimony, GAO summarized the progress FirstNet has made in meeting its responsibilities but noted that it had not put in place a number of measures that GAO considers important. Notably, GAO found that FirstNet has not fully assessed the risks associated with its planning efforts (such as conflict of interest); has not established Standards of Conduct; and is not fully evaluating the information from five "early builder" projects.

The full report expands on the information provided in testimony. The full report includes, for example, a timeline and other information regarding the development of FirstNet; more details about the "early builder" program; and some insight into FirstNet's planning process. Regarding the interaction of planning and the cost of building the network, GAO's comments include these observations:

"As part of its planning and market research, FirstNet has developed a cost estimate for its public safety network that met most of the best practices against which we evaluated it." "FirstNet's cost estimate, including the assumptions it is based on, are not public because of the highly sensitive nature of the information it contains." "We did not assess FirstNet's cost estimate against all the characteristics established in our Cost Estimating and Assessment Guide. Specifically, we did not assess whether FirstNet's estimate was 'credible' or 'accurate' because the estimate and its associated documentation were deemed business sensitive." "We did not analyze the quantitative input and output of the cost model because the data included procurement sensitive information, and we would therefore be unable to report our findings in a public report." "Therefore we cannot say if the estimate is in line with the credible and accurate characteristics of our Cost Estimating and Assessment Guide."

OIG Report on FirstNet

Criticism by a member of the board of FirstNet, in April 2013—regarding a lack of transparency in information provided to the Board and other issues—led to a review of practices by the Office of Inspector General (OIG.). The primary focus of the review had two main objectives, to determine whether the Department of Commerce (DOC)

had adequate processes in place to ensure that FirstNet Board members properly filed financial disclosures and identified potential conflicts of interest; and used appropriate contracting processes and requirements.

The overall finding is that some monitoring procedures were inadequate, including, for example, a finding that "FirstNet contracting practices lacked transparent award competition, sufficient oversight of hiring, adequate monitoring, and procedures to prevent erroneous costs.... "

In its review, the OIG looked at the roles of the NTIA, the DOC Office of General Counsel, and two agencies within DOC that were assigned direct responsibilities to assist FirstNet; the Bureau of the Census and NIST were asked to award and manage contracts with outside entities to provide assistance to FirstNet. The OIG did not specifically review activities of the NTIA Office of Public Safety Communications, created to assist FirstNet with administrative tasks, including staffing.

The OIG review determined that nearly $11 million had been inappropriately spent, much of it going for consulting work that did not meet contractual definitions of deliverables. The OIG referred to this consulting work as "work products" and questioned the expenditures. The DOC responded that it conducted relevant contracting activities in accordance with federal procurement laws and regulations and monitored performance, and that the contracts produced "first-rate feasibility research, technical analysis, strategic planning, and outreach services from highly specialized consultants, whose work product has laid the groundwork for executing FirstNet's mission."

The OIG made recommendations to the Secretary, the General Counsel, the Chair of FirstNet, and the DOC's Senior Procurement Official regarding various procedures and responsibilities. A joint response from FirstNet, the NTIA, and the General Counsel concurred with the specific recommendations from the OIG, although not all the findings. In general, they defended their actions in the context of unique requirements and time constraints in setting up FirstNet.

The OIG review covered a limited range of issues linked to oversight procedures. Although it did not go into detail, the OIG noted "inconsistent administration" and several instances of significant time lags in the performance of DOC officials. For example, "6 months after the Board began regular meetings, senior NTIA and Office of General Counsel officials were still debating [the monitoring] of potential conflicts of interest." OIG found that most of the lapses occurred in the year after the FirstNet board held its first official meeting in September 2012. The review observed that "neither a business plan nor a network plan were completed or delivered to FirstNet during the 1-year performance period of the contracts.... "

The OIG has established a team to audit and evaluate FirstNet activities. Additionally, it operates a fraud, waste, and abuse hotline for the Department of Commerce, which has received complaints regarding FirstNet. The OIG conducts follow-up on these complaints.

Testimony at a Senate hearing on June 21, 2016, provided an update of OIG oversight of FirstNet activities. OIG reported ongoing improvements in implementing internal controls and risk assessment at FirstNet. Testimony highlighted several short- and long-term risks for FirstNet, such as the need for successfully managing the choice of contractor; setting competitive prices; and effective consultation with state and other authorities that are FirstNet's target customer base.

Discussion of Other Provisions in the Spectrum Act to Improve Public Safety Communications

Following is a discussion of other major provisions in the act that pertain to public safety communications, including provisions to improve the nation's 911 emergency call system.

Among federal agencies designated by the act to provide consultation and support are the Federal Communications Commission (FCC), the National Telecommunications and Information Administration (NTIA), the National Institute of Standards and Technology (NIST), and the Office of Emergency Communications (OEC). The FCC manages commercial and non-federal spectrum use, including spectrum allocated to public safety. The NTIA manages federal spectrum resources and, along with NIST, is an agency within the Department of Commerce. OEC is part of the Office of Cybersecurity and Communications, Department of Homeland Security.

Spectrum Assignment

Radio frequency spectrum is an essential resource for wireless communications. The energy in electronic telecommunications transmissions converts electro-magnetic spectrum (airwaves) into signals to deliver voice, text, and images. These signal frequencies are allocated for specific purposes, such as television broadcasting or WiFi, and assigned to specific users through licenses. Allocating sufficient spectrum for wireless emergency communications has long been a concern for Congress. The Balanced Budget Act of 1997 ( P.L. 105-33 ), for example, directed the FCC to allocate 24 MHz of spectrum in the 700 MHz band for public safety use.

With the passage of the Spectrum Act, some existing public safety licenses in the 700 MHz band and an additional license for commercial use (known as the D Block) —together totaling 22 MHz—have been re-designated by Congress for a federal license for paired spectrum at 758-768 MHz and 788-798 MHz, plus guard bands at 768-769 MHz and 798-799 MHz to mitigate interference from adjacent channels. As required by the act, the initial, 10-year license to use these frequencies was assigned by the FCC to FirstNet. It is renewable for an additional 10 years, on condition that FirstNet has met its duties and obligations under the act.

A total of 34 MHz of spectrum capacity will therefore be available for public safety networks within the 700 MHz band: the 22 MHz designated for broadband, and 12 MHz allocated for narrowband communications, primarily voice. Additionally, there are public safety networks on adjacent frequencies within the 800 MHz band. Time and technological advances may someday bring these spectrum assets together, but at present there are three distinct public safety network technologies in use or planned within the 700 MHz and 800 MHz bands. These are broadband communications at 700 MHz; interoperable narrowband communications at 700 MHz; and narrowband communications at 800 MHz. Some of the narrowband networks at 700 MHz and 800 MHz can share infrastructure and radios but older narrowband networks at 800 MHz are often not easily integrated with narrowband networks being built on 700 MHz frequencies.

The act also gives the FCC the authority to " ... allow the narrowband spectrum to be used in a flexible manner, including usage for public safety broadband communications ... " subject to technical and interference protection measures. States, therefore, might be able to convert some existing narrowband networks to broadband use in addition to service from FirstNet.

The act requires that public safety users return frequencies known as the T-Band. These are frequencies between 470 and 512 MHz allocated for television that have been made available for public safety use in 11 urban areas. Since the transition to digital television, radio transmissions on some of these frequency assignments have experienced interference and the public safety agencies that use them are considering moving to new networks at 700 MHz. Other areas have recently invested to upgrade networks built on the T-Band frequencies and are concerned about the loss of this communications capacity. The act requires that the FCC act by February 2021 to establish a relocation plan that would free up the T-Band for reassignment through competitive bidding. Proceeds from the auctions of T-Band frequencies are to be available for grants to cover relocation costs. There are no requirements in the law as to how the NTIA, the designated grants administrator, is to structure the grant program or determine eligible costs. The law also does not address technical complications that may arise because of adjacent commercial assignments not included in the rebanding.

Some of the earliest spectrum assignments for public safety are in channels below 512 MHz. Public safety and other license-holders in designated channels below 512 MHz are required to reband their holdings to conform to an FCC mandate to improve spectrum efficiency. This narrowbanding requirement, as it is called, requires that assigned channels be reduced from a width of 25 kHz to 12.5 kHz, thereby freeing up new spectrum capacity for public safety and other uses. The deadline to meet the narrowbanding requirement was January 1, 2013. To accommodate public safety license holders in the T-Band that now fall under requirements established in the act, the FCC has ruled to exempt them from the narrowbanding requirements.

Public Safety Trust Fund

The law provides for transfers from a Public Safety Trust Fund, which is established in the Treasury by the act, to receive revenues from designated auctions of spectrum licenses. The designated amounts are to remain available through FY2022, after which any remaining funds are to revert to the Treasury, to be used for deficit reduction. Auction proceeds are to be distributed in the following order of priority:

To the NTIA, to reimburse the Treasury for funds advanced to cover the initial costs of establishing FirstNet: not to exceed $2 billion. To the State and Local Implementation Fund for a grant program: $135 million. To the Network Construction Fund for costs associated with building the nationwide network and for grants to states that qualify to build their own networks: $7 billion, reduced by the amount advanced to establish FirstNet. To NIST for public safety research: $100 million. To the Treasury for deficit reduction: $20.4 billion. To the NTIA and the National Highway Traffic Safety Administration for a grant program to improve 911 services: $115 million. To NIST for public safety research, phase two: $200 million. To the Treasury for deficit reduction: any remaining amounts from designated auction revenues.

In compliance with the act, the FCC conducted two auctions in 2014-2015 (Auctions 96 and 97) that generated sufficient revenue to meet the funding requirements of the act summarized above.

FirstNet: Limit on Expenditures

The act caps FirstNet's administrative expenses at $100 million in total over the first 10 years of operation. Costs attributed to oversight and audits are not included in the expense cap.

FirstNet: Fee Income and Other Revenue

Congress gave FirstNet the authority to obtain grants, and to receive payment for the use of network capacity licensed to FirstNet and of network infrastructure "constructed, owned, or operated" by FirstNet. Specifically, FirstNet is authorized to collect network user fees from public safety and secondary users and to receive payments under leasing agreements in public-private partnerships. These partnerships may be formed between FirstNet and a secondary user for the purpose of constructing, managing, and operating the network. The agreements may allow access to the network on a secondary basis for services other than public safety. The act requires that these fees be sufficient each year to cover annual expenses of FirstNet to carry out required activities, with any remaining revenue going to network construction, operation, maintenance, and improvement. There is a prohibition on providing service directly to consumers; this does not impact the right to collect fees from a secondary user or enter into leasing agreements.

Planning Authority

The Spectrum Act created FirstNet as an independent entity within the NTIA. FirstNet is required to plan for and establish an interoperable broadband network for public safety. The act requires that state and local agencies and tribal authorities have a consulting role in the development, deployment, and operation of the nationwide network. The act further provides an opportunity for states to plan and build their own Radio Access Networks within the framework of the nationwide broadband network. Unless renewed, this authority expires in 2027.

When Congress creates an independent entity within the federal government, it may have the obligation to achieve a specific goal, usually within a specific time frame. As an independent entity, FirstNet—the First Responder Network Authority—has been given both goals and time frames. It has been instructed by Congress to exercise all powers specifically granted by the act and "such incidental powers as shall be necessary" to create a nationwide broadband network for public safety. The law requires FirstNet to become a self-funding entity, independent of government subsidies. FirstNet is to take "all actions necessary to ensure the building, deployment, and operation" of the network in consultation with federal, state, tribal, and local public safety entities, the Director of NIST, the FCC, and the public safety advisory committee. FirstNet appears therefore to be an autonomous organization, with broad powers to carry out its mandate, within the requirements established by the law. It has, for example, sole power to select the program's manager and its agents, consultants, and other experts subject to the requirement that they be chosen "in a fair, transparent, and objective manner." However, FirstNet, except for certain exemptions provided in the act, must follow federal agency requirements, notably in hiring and procurement, slowing down the process for establishing FirstNet as a going concern.

FirstNet is headed by a board of 15 members of which 12 are appointed by the Secretary of Commerce according to criteria established by the act, which are intended to provide both representation from key stakeholders and expertise. The other three members of the board are designees of the Secretary of the Department of Homeland Security, the Attorney General of the United States, and the Director of the Office of Management and Budget. The Secretary of Commerce is required to appoint a chairman of the board for an initial term of two years.

As part of its management of the network, FirstNet is required, at a minimum

To establish network policies, including development of detailed requests for proposals to build the network, and operational matters such as terms of service and billing practices. To consult with states on network-related expenditures, as part of the preparation of policies and requests for proposals. To enter into agreements to use existing communications infrastructure, including commercial and federal infrastructure, "to the maximum extent economically desirable." To ensure the construction, maintenance, operation, and improvement of the broadband network, taking into account new and evolving technologies. To enter into agreements with commercial networks to allow public safety roaming on their networks. To represent the interests of the network's users before standards-setting boards, in consultation with NIST, the FCC, and its own Public Safety Advisory Committee.

FirstNet is required to create a public safety advisory committee to assist in carrying out its mandate. There are no requirements in the statute as to the composition of the committee. By-laws adopted at the organizing meeting of the FirstNet Board of Directors on September 25, 2012, created a Public Safety Advisory Committee. It was further agreed that the members of the committee would be chosen from the Advisory Committee to SAFECOM, within the Department of Homeland Security, in consultation with the Secretary of Homeland Security. The organizations chosen to be represented on the committee were announced on February 20, 2013. State and local government interests are represented through a subcommittee of PSAC.

Statutory Obligations

Examples of statutory obligations for Congress and the Administration in the direction of FirstNet include the following.

Membership on FirstNet b oard . The members of the FirstNet board are to be chosen by the Secretary of Commerce, within the parameters established in the act. The Department of Homeland Security, the Attorney General, and the Office of Management and Budget each have one member on the board in permanence. The Secretary of Commerce is required to appoint a chairman of the board for an initial term of two years.

Grant p rograms for planning . The NTIA is to establish and administer the State and Local Implementation Fund. Grant provisions are to be decided in consultation with FirstNet, but not necessarily in accordance with decisions made by the FirstNet board and executive management.

Grant programs for state networks . The NTIA is to administer grants from the Network Construction Fund to states that qualify to build their own Radio Access Networks and choose to apply for a grant.

Funding for FirstNet and participating states through the Network Construction Fund. The NTIA is to determine the funding level available to each state for the buildout of the nationwide broadband network, if the state chooses to participate in FirstNet.

Spectrum leases for state networks. The NTIA sets the terms and is responsible for enforcing the requirement that states qualifying to build their Radio Access Networks must sublease spectrum through FirstNet, the assigned license-holder.

License r eview. The FCC is required to review the initial 10-year license assigned to FirstNet and consider its renewal based on performance criteria.

Performance r eview . The Government Accountability Office (GAO), within 10 years, is to prepare a report providing recommendations on "what action Congress should take" regarding the mandated termination of authority of FirstNet in 2027.

Fee schedule . The NTIA is to review and approve the annual schedule of fees charged to public safety agencies and other users for access to FirstNet's resources.

Annual audit . The Secretary of Commerce is to contract for an annual audit of FirstNet's finances and activities. The reports are to be submitted to Congress, the President, and FirstNet.

Report to Congress . FirstNet is required to submit annual reports to Congress on its "operations, activities, financial conditions, and accomplishments." The designated appropriate congressional committees are, in the Senate, the Committee on Commerce, Science, and Transportation; in the House, the Committee on Energy and Commerce.

Time Frame

The requirements of the Spectrum Act must be substantially met and the viability of the project demonstrated no later than the end of FY2022, if not sooner. The State and Local Implementation Fund and the Network Construction Fund expire in 2022, with any balances reverting to the Treasury. By 2022, GAO must have assessed the performance of FirstNet and provided a report to Congress; and the FCC must decide whether or not to renew the licenses for the public safety broadband network. Within this 10-year time frame, there are few deadlines beyond requirements for the initial establishment of the planning and implementation framework.

Many of the important steps for building the network have no required deadline. Some milestones, such as rural coverage, are mandated in the act, but the deadlines are not specified. There are, for example, no deadlines in provisions that require FirstNet to

Develop requests for proposals that include a requirement for timetables. Consult with states on establishing state and local planning processes. Complete the request for proposal process that is to be given to each state governor regarding the request for proposal and its details, and the funding level for each state as determined by the NTIA.

Mandated deadlines for states include

Within 90 days of receipt of notice from FirstNet, the governor shall choose either to participate in deployment of FirstNet or to conduct its own Radio Access Network deployment within the state. Within 180 days of giving notice to opt out of FirstNet, the governor shall complete requests for proposals for a state network.

No deadline is established in the statute for the FCC to approve or disapprove state proposals for their own portion of the nationwide broadband network. There are also no specified deadlines for a state to apply to the NTIA for a grant to construct the Radio Access Network and to lease spectrum capacity from FirstNet, if FCC approval is received for a state network. However, one condition of eligibility for a grant to a state to build its own Radio Access Network is that the state's plan must demonstrate "the ability to complete the project within specified comparable deadlines.... "

Next Generation 9-1-1

Today's 911 system is built on an infrastructure of analog technology that does not support many of the features that most Americans expect to be part of an emergency response. Efforts to splice newer, digital technologies onto this aging infrastructure have created points of failure where a call can be dropped or misdirected, sometimes with tragic consequences. Callers to 911, however, generally assume that the newer technologies they are using to place a call are matched by the same level of technology at the 911 call centers, known as Public Safety Answering Points (PSAPs). However, this is not always the case. To modernize the system to provide the quality of service that approaches the expectations of its users will require that the PSAPs and state, local, and possibly federal emergency communications authorities invest in new technologies. As envisioned by most stakeholders, these new technologies—collectively referred to as Next Generation 911 or NG9-1-1—should incorporate Internet Protocol standards. An IP-enabled emergency communications network that supports 911 will facilitate interoperability and system resilience; improve connections between 911 call centers; provide more robust capacity; and offer flexibility in receiving and managing calls. The same network can also serve wireless broadband communications for public safety and other emergency personnel, as well as other purposes.

Recognizing the importance of providing effective 911 services, Congress has previously passed three major bills supporting improvements in the handling of 911 emergency calls. The Wireless Communications and Public Safety Act of 1999 ( P.L. 106-81 ) established 911 as the number to call for emergencies and gave the Federal Communications Commission (FCC) authority to regulate many aspects of the service. The most recent of these laws, the NET 911 Improvement Act of 2008 ( P.L. 110-283 ), required the preparation of a National Plan for migrating to an IP-enabled emergency network. Responsibility for the plan was assigned to the E-911 Implementation Coordination Office (ICO), created to meet requirements of an earlier law, the ENHANCE 911 Act of 2004 ( P.L. 108-494 ). Authorization for the ICO terminated on September 30, 2009. ICO was jointly administered by the National Telecommunications and Information Administration and the National Highway Traffic Safety Administration.

Spectrum Act provisions re-establish the federal 9-1-1 Implementation Coordination Office (ICO) to advance planning for next-generation systems and to administer a grant program. ICO is to provide matching grants to eligible state or local governments or tribal organizations for the implementation, operation, and migration of various types of 911 and IP-enabled emergency services, and for public safety personnel training. States that have diverted fees collected for 911 services are not eligible for grants under the program.

Provisions in the act regarding 911 programs include

GAO is required to study how states assess fees on 911 services and how those fees are used. The General Services Administration is required to prepare a report on 911 capabilities of multi-line telephone systems in federal facilities and the FCC is to seek comment on the feasibility of improving 911 identification for calls placed through multi-line telephone systems. The FCC is to assess the legal and regulatory environment for development of NG9-1-1 and barriers to that development, including state regulatory roadblocks. The FCC is also to (1) initiate a proceeding to create a specialized Do-Not-Call registry for public safety answering points, and (2) establish penalties and fines for autodialing (robocalls) and related violations. ICO, in consultation with NHTSA and DHS, is to report on costs for requirements and specifications of NG9-1-1 services, including an analysis of costs, and assessments and analyses of technical uses. Immunity and liability protections are provided—to the extent consistent with specified provisions of the Wireless Communications and Public Safety Act of 1999—for various users and providers of Next Generation 911 and related services, including for the release of subscriber information.

The act also requires FirstNet to promote integration of the nationwide public safety broadband network with PSAPs.

Roaming and Priority Access Within the 700 MHz Band

In its National Broadband Plan , the FCC indicated that it wanted to make commercial networks in the 700 MHz band available for public safety use and requested that Congress confirm the FCC's authority to act. The Spectrum Act provides the FCC with statutory authority to establish rules in the public interest to improve the ability of public safety networks to roam on commercial space and to gain priority access.

FirstNet is empowered by the act to enter into agreements with commercial providers that would allow public safety network users to roam on partnering networks. The act does not state whether roaming agreements may be negotiated by states that opt out and receive spectrum leases from the NTIA to operate their own Radio Access networks. Agreements might also cover rules for priority access in times of high demand for network capacity. Priority access can take several forms, such as "ruthless pre-emption," in which non-public-safety transmissions are immediately terminated to make way for emergency communications, or negotiated priority agreements that might, for example, place public safety users at the head of the line for network access as capacity becomes available. The act stipulates that the FCC's authority may not require roaming or priority access unless (1) the public safety and commercial networks are technically compatible; (2) the commercial network is reasonably compensated; and (3) access does not preempt or otherwise terminate or degrade existing traffic on the commercial network. Within these limits, the FCC appears to have some leeway to use its regulatory authority to support public safety in negotiations with partners. The FCC cannot, under the act, mandate ruthless pre-emption, although the act does not preclude contractual negotiations that would allow it.

The act's provisions for roaming and priority access do not require a commercial vendor to make additional investments to insure technical compatibility, and the act's language might be interpreted as precluding an FCC mandate to that effect. Full-spectrum roaming is considered by many to provide advantages for public safety and also for the public at large. For example, it makes more network capacity available for shared emergency communications of all types, not just for first responders. Many believe that full-spectrum access supports competitiveness among wireless carriers—in particular assisting small wireless carriers serving rural areas to offer new broadband services—by providing access to all customers within the band.

Legislation in the 115th Congress

Legislation in the 115 th Congress addressing public safety communications issues includes the following.

H.R. 588 (Pallone). Securing Access to Networks in Disasters Act. Directs the FCC to conduct a study on network resiliency during times of emergency. Requires the FCC to submit within three years a study on the public safety benefits and technical feasibility and cost of (1) making telecommunications service provider-owned WiFi access points, and other communications technologies operating on unlicensed spectrum, available to the general public for access to 9-1-1 services, without requiring any login credentials during times of emergency when mobile service is unavailable; (2) the provision by non-telecommunications service provider-owned WiFi access points of public access to 9-1-1 services during times of emergency when mobile service is unavailable; and (3) other alternative means of providing the public with access to 9-1-1 services during times of emergency when mobile service is unavailable. Also amends the Stafford Act to include all communications providers as essential service providers during federally declared emergencies. Introduced January 17, 2017; passed by House (voice vote) on January 23, 2017.

S. 102 (Cantwell). Securing Access to Networks in Disasters Act of 2017. Directs the FCC to conduct a study on alternative access to 9-1-1 services during times of emergency. Requires the FCC to submit within three years a study on the public safety benefits and technical feasibility and cost of (1) making telecommunications service provider-owned WiFi access points, and other telecommunications service provider-owned communications technologies operating on unlicensed spectrum, available to the general public for access to 9–1–1 services without requiring any login credentials during times of emergency when mobile service is unavailable; (2) the provision by non-telecommunications service provider-owned WiFi access points of public access to 9-1-1 services during times of emergency when mobile service is unavailable; and (3) other alternative means of providing the public with access to 9-1-1 services during times of emergency when mobile service is unavailable. Directs GAO to conduct a study on how executive departments can better ensure essential communications services remain operational during times of emergency; any legislative matters Congress could consider to help promote the resiliency of essential communications services; and whether a nationwide directory of points of contact among providers of essential communications services is needed to facilitate the rapid restoration of such services damaged during times of emergency. Also amends the Stafford Act to expand list of essential service providers during federally declared emergencies to include all communications providers. Introduced January 11, 2017; ordered to be reported with an amendment in the nature of a substitute favorably by the Committee on Commerce, Science, and Transportation on January 24, 2017.

H.R. 582 (Gohmert). Kari's Law Act of 2017. Amends the Communications Act of 1934 to require multi-line telephone systems to have a configuration that permits users to directly initiate a call to 9-1-1 without dialing any additional digit, code, prefix, or post-fix. Introduced January 17, 2017; passed by House (408-0) on January 23, 2017.

S. 123 (Klobuchar). Kari's Law Act of 2017. Amends the Communications Act of 1934 to require multi-line telephone systems to have a default configuration that permits users to directly initiate a call to 9-1-1 without dialing any additional digit, code, prefix, or post-fix. Ordered to be reported favorably by the Committee on Commerce, Science, and Transportation on January 24, 2017.