Debt ceiling deal nixes spectrum auction provisions

Legislation to raise the nation's debt ceiling that President Obama signed into law Tuesday does not include any provisions on incentive auctions for broadcast spectrum, delivering a victory to broadcasters and a blow to the wireless industry. However, the auctions and other spectrum-related bills could be revived before the year is over.

The 11th-hour deal was stripped of language that Senate Majority Leader Harry Reid (D-Nev.) had inserted to authorize the incentive auctions, which the Congressional Budget office estimates could raise up to $12 billion. The final legislation also says nothing about allocating the D Block of the 700 MHz band directly to public safety, a provision that was also part of Reid's plan. Many lawmakers have been pushing for a resolution on both issues, and Reid's bill would have set aside $7 billion through 2017 for the construction of a nationwide, interoperable public-safety broadband network using the D Block.

Incentive auctions would allow broadcasters to voluntarily relinquish spectrum in exchange for a portion of the proceeds, although broadcasters have been hesitant to sign on and worried that the auctions will not be strictly voluntary.

In the aftermath of the deal, the National Association of Broadcasters crowed of its victory while lawmakers expressed disappointment that spectrum issues were not wrapped into the final bill. Lawmakers have expressed particular frustration over the unresolved fate of the D Block, especially as the 10-year anniversary of the Sept. 11 terrorist attacks approaches.

"I am disappointed that the debt compromise reached yesterday does not include provisions that will better allow first responders to communicate with each other and hope the special committee will consider it in its recommendations," Sen. Joseph Lieberman (I-Conn.) said. "Despite this temporary setback, we still must fulfill the 9/11 Commission's recommendation and pass legislation dedicating the D Block spectrum to first responders."

Despite the setbacks for proponents of the auctions and the D-Block reallocation, there is some optimism that the proposals could become law later this year. Sen. Jay Rockefeller (D-W.Va.) has vowed to fight for the D Block language in a standalone bill. Additionally, as part of the deal, Congress agreed to form a supercommittee charged with finding $1.2 trillion to $1.5 trillion in additional defect-reductions, and spectrum auctions could be a part of that.

"Even if the deficit-reduction super committee fails to include public safety/incentive auction language in legislation (it must report by Thanksgiving and that is subject to a straight up-or-down vote), it is still possible spectrum provisions could be woven into stop-gap funding (continuing resolution) before the new fiscal year begins Sept. 1 in order to pay for extended unemployment benefits and/or other programs not included in the debt relief bill," Medley Global Advisors analyst Jeffrey Silva wrote in a research note.

For more:
- see this National Journal article
- see this The Hill article
- see this separate The Hill article
- see this Broadcasting & Cable article

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