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Commercial Spectrum Enhancement Act of 2004

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Citation Edit

Commercial Spectrum Enhancement Act of 2004 (CSEA), Title II of H.R. 5419, Pub. L. No. 108-494, 118 Stat. 3986, 3991 (codified at 47 U.S.C. §§151, 301, 302, 303).

Overview Edit

The Act sought to make more spectrum available for wireless broadband and other services by facilitating the reallocation of spectrum from government to commercial users. While the Act provided a foundation for promoting more efficient use of spectrum, its limitations — a lack of support for up-front planning, cost estimation, design and procurement preparation funds and an absence of more concrete incentives for agencies to change their use of spectrum — need to be addressed to better incentivize government agencies to change their existing usage of spectrum.

The Act facilitated the reallocation of 45 megahertz (MHz) of spectrum at 1710-1755 MHz from Federal use to commercial use.

The Act created the Spectrum Relocation Fund to provide a centralized and streamlined funding mechanism through which federal agencies can recover the costs associated with relocating their radio communications systems from certain spectrum bands, which were authorized to be auctioned for commercial purposes. Funds for compensation are only available when the federal entities relocate from spectrum awarded to nonfederal entities through a competitive bidding, or auction process. A portion of the revenues obtained in the auction of the spectrum to nonfederal entities is then credited to the Spectrum Relocation Fund to pay the relocation costs of federal entities.

2012 Amendments Edit

The CSEA was amended by the Middle Class Tax Relief and Job Creation Act of 2012 to facilitate the transfer of spectrum rights to commercial purchasers from the agencies relinquishing spectrum. Expenditures incurred by federal agencies for planning may now be included among those costs eligible for reimbursement as part of the transfer of spectrum to the commercial sector. Other reimbursable costs cover a wide range of technical options, including spectrum sharing.[1]

The Act requires the establishment of a Technical Panel within the NTIA to review transition plans that each federal agency must prepare in accordance with provisions in the Act.[2] The Technical Panel is required to have three members qualified as a radio engineer or technical expert. The Director of the Office of Management and Budget, the Assistant Secretary of Commerce for Communications and Information, and the Chairman of the FCC have been required to appoint one member each.[3] Spectrum sharing to facilitate the transition from federal to commercial use is supported in the Act's provisions. However, the NTIA has been required to give priority to reallocation options that assign spectrum for exclusive, non-federal uses through competitive bidding.[4]

The CSEA put in place statutory rules for covering the costs to federal agencies of relocating wireless communications facilities to new spectrum assignments. The Act created the Spectrum Relocation Fund to provide a means for federal agencies to recover relocation costs directly from auction proceeds when they are required to vacate spectrum slated for auction. In effect, successful commercial bidders cover the costs of relocation.

Among key provisions of the Act were requirements that the auctions must recoup at least 110% of the costs projected by the NTIA, and that unused funds would revert to the Treasury after eight years. These provisions remain in effect. Specific frequencies were designated for immediate auction by the CSEA but the law was written to apply to any federally used frequencies scheduled for reallocation and possible auction.

References Edit

  1. Middle Class Tax Relief and Job Creation Act of 2012, Pub. L. No. 112-96, §6701(a)(1)(D)(3).
  2. Id. §6701(a)(3)(h).
  3. Id. §6701(a)(3)(h)(3)(B).
  4. Id. §6701(a)(3)(j).

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