Rule2022-27820
Facilitating Shared Use in the 3100-3550 MHz Band
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
December 22, 2022
Effective
January 23, 2023
Issuing agencies
Federal Communications Commission
Abstract
In this document, the Wireless Telecommunication Bureau (Bureau) selects the four entities that will represent the interest of the new entrants to the 3.45-3.55 GHz band in selecting the Reimbursement Clearinghouse. The four entities selected are NBCUniversal, Nexstar Broadcasting (Nexstar), CTIA-The Wireless Association (CTIA), and the Competitive Carriers Association (CCA). In addition, the Bureau adopts certain requirements regarding the Clearinghouse search committee process and the operation of the Clearinghouse. These requirements support the prevention of waste, fraud, and abuse in the handling of reimbursement funds and will protect confidential information.
Full Text
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<title>Federal Register, Volume 87 Issue 245 (Thursday, December 22, 2022)</title>
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[Federal Register Volume 87, Number 245 (Thursday, December 22, 2022)]
[Rules and Regulations]
[Pages 78573-78579]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2022-27820]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Parts 1, 2 and 27
[WT Docket No. 19-348; DA 22-1188; FR ID 116794]
Facilitating Shared Use in the 3100-3550 MHz Band
AGENCY: Federal Communications Commission.
ACTION: Final action.
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SUMMARY: In this document, the Wireless Telecommunication Bureau
(Bureau) selects the four entities that will represent the interest of
the new entrants to the 3.45-3.55 GHz band in selecting the
Reimbursement Clearinghouse. The four entities selected are
NBCUniversal, Nexstar Broadcasting (Nexstar), CTIA-The Wireless
Association (CTIA), and the Competitive Carriers Association (CCA). In
addition, the Bureau adopts certain requirements regarding the
Clearinghouse search committee process and the operation of the
Clearinghouse. These requirements support the prevention of waste,
fraud, and abuse in the handling of reimbursement funds and will
protect confidential information.
DATES: This final agency action is effective January 23, 2023.
ADDRESSES: Federal Communications Commission, 45 L Street NE,
Washington, DC 20554.
FOR FURTHER INFORMATION CONTACT: Morgan Mendenhall, Wireless
Telecommunications Bureau, Mobility Division, (202) 418-0154 or
<a href="/cdn-cgi/l/email-protection#a1ccced3c6c0cf8fccc4cfc5c4cfc9c0cdcde1c7c2c28fc6ced7"><span class="__cf_email__" data-cfemail="b1dcdec3d6d0df9fdcd4dfd5d4dfd9d0ddddf1d7d2d29fd6dec7">[email protected]</span></a>. For information regarding the Paperwork
Reduction Act information collection requirements, contact Cathy
Williams, Office of Managing Director, at 202-418-2918 or
<a href="/cdn-cgi/l/email-protection#8deeecf9e5f4a3fae4e1e1e4ece0fecdebeeeea3eae2fb"><span class="__cf_email__" data-cfemail="462527322e3f68312f2a2a2f272b350620252568212930">[email protected]</span></a>.
SUPPLEMENTARY INFORMATION: This summary of the 3.45 GHz Clearinghouse
Order in WT Docket No. 19-348, DA 22-1188, adopted and released
November 10, 2022. The full text of the 3.45 GHz Clearinghouse Order,
including all Appendices, is available for public inspection at the
following internet address: <a href="https://docs.fcc.gov/public/attachments/DA-22-1188A1.pdf">https://docs.fcc.gov/public/attachments/DA-22-1188A1.pdf</a>. Alternative formats are available for people with
disabilities (Braille, large print, electronic files, audio format), by
sending an email to <a href="/cdn-cgi/l/email-protection#b8fefbfb8d888cf8dedbdb96dfd7ce"><span class="__cf_email__" data-cfemail="f9bfbabaccc9cdb99f9a9ad79e968f">[email protected]</span></a> or calling the Consumer and
Governmental Affairs Bureau at 202-418-0530 (voice) or 202-418-0432
(TTY).
Final Regulatory Flexibility Analysis
The Regulatory Flexibility Act of 1980, as amended (RFA), requires
that an agency prepare a regulatory flexibility analysis for notice and
comment rulemakings, unless the agency certifies that ``the rule will
not, if promulgated, have a significant economic impact on a
substantial number of small entities.'' 5 U.S.C. 605(b). Accordingly,
the Commission has prepared a Final Regulatory Flexibility Analysis
(FRFA) concerning the possible impact of the rule changes contained in
the 3.45 GHz Band Second Report and Order (R&O) (86 FR 17920, April 7,
2021) on small entities. As required by the RFA, an Initial Regulatory
Flexibility Analysis (IRFA) was incorporated in the Further Notice of
Proposed Rulemaking (FNPRM) released in October 2020 in this proceeding
(85 FR 66888, October 21, 2020). The Commission sought written public
comment on the proposals in the FNPRM, including comments on the IRFA.
No comments were filed addressing the IRFA. This FRFA conforms to the
RFA. The Commission will send a copy of the 3.45 GHz Clearinghouse
Order, including the FRFA, to the Chief Counsel for Advocacy of the
Small Business Administration.
Paperwork Reduction Act
This document contains new or modified information collection
requirements subject to the Paperwork Reduction Act of 1995, Public Law
104-13. In addition, it contains new or modified information collection
burden for small business concerns with fewer than 25 employees,
pursuant to the Small Business Paperwork Relief Act of 2002, Public Law
107-198, see 44 U.S.C. 3506(c)(4).
Congressional Review Act
The Commission will send a copy of the 3.45 GHz Clearinghouse Order
(Order) to Congress and the Government Accountability Office pursuant
to the Congressional Review Act, see 5 U.S.C. 801(a)(1)(A).
Synopsis
I. Introduction
With this final action, the Wireless Telecommunications Bureau
(Bureau) identifies four entities that will form a search committee to
select a Reimbursement Clearinghouse (Clearinghouse) to oversee the
reimbursement of relocation expenses for certain secondary, non-Federal
radiolocation licensees in the 3.45-3.55 GHz band (3.45 GHz band).
These entities are NBCUniversal, Nexstar Broadcasting (Nexstar), CTIA,
and the Competitive Carriers Association (CCA). In addition, the Bureau
adopts certain requirements regarding the Clearinghouse search
committee process and the operation of the Clearinghouse. These
requirements support the prevention of waste, fraud, and abuse in the
handling of reimbursement funds and will protect confidential
information.
II. Background
In the 3.45 GHz Band Second R&O, the Commission adopted rules to
make 100 megahertz of mid-band spectrum available for flexible use
throughout the contiguous United States. To facilitate this goal, the
Commission previously had determined that secondary, non-Federal
radiolocation licensees in the band would be relocated to the 2.9-3.0
GHz band. In the 3.45 GHz Band Second R&O, the Commission further
determined that secondary, non-Federal radiolocation authorizations
would sunset 180 days after new 3.45 GHz Service licenses are granted
in the band. Because these licenses were granted on May 4, 2022, the
non-Federal radiolocation authorizations sunset on October 31, 2022. In
addition, the Commission in the 3.45 GHz Band Second R&O required ``new
flexible-use licensees in the 3.45 GHz Service to reimburse secondary,
non-federal radiolocation licensees for reasonable costs related to the
relocation of those
[[Page 78574]]
operations to the 2.9-3.0 GHz band, including the costs of a relocation
clearinghouse's administration of the reimbursement.'' 36 FCC Rcd 5987,
6042, para 155 (2021), 86 FR 60775 . Specifically, each new 3.45 GHz
Service licensee will be responsible for reimbursement of a pro rata
share of reasonable relocation costs of non-Federal radiolocation
operations.
The Commission in the 3.45 GHz Band Second R&O delegated authority
to the Bureau, working in coordination with the Office of the Managing
Director, to develop and implement a clearinghouse selection process
similar to the process used in the 3.7 GHz proceeding. The Commission's
delegation also included the authority to seek notice and comment on
the parameters of additional considerations that should inform the
creation and administration of the cost-sharing plan to help implement
the Commission's decision and, if necessary for the purposes of the
more limited relocation in the 3.45 GHz Service, to adjust the
procedures adopted in the 3.7 GHz proceeding to tailor them to the
relocation in the 3.45 GHz proceeding. As in the 3.7 GHz proceeding,
the Commission in the 3.45 GHz Band Second R&O provided for the
creation of a neutral, independent clearinghouse to oversee the
collection and distribution of relocation reimbursement payments from
new 3.45 GHz Service licensees to non-Federal secondary radiolocation
incumbents. Unlike in the 3.7 GHz context, however, in the 3.45 GHz
proceeding, the Commission did not identify the specific industry
stakeholders who would compose the search committee to select the
Clearinghouse.
On August 20, 2021, the Bureau released a Public Notice (Search
Committee Public Notice) seeking comment on the selection process for,
and operation of, the Clearinghouse. Comments and replies were due on
September 30, 2021, and October 12, 2021, respectively (86 FR 51335,
September 15, 2021). The Bureau received comments from Nexstar,
NBCUniversal, and CTIA; a reply from the Wireless Infrastructure
Association (WIA); and a subsequent ex parte letter from CCA.
III. Discussion
A. Composition of the Clearinghouse Search Committee
As noted above, the Commission delegated authority to the Bureau to
implement a clearinghouse selection process similar to the process used
in the 3.7 GHz band transition. In the 3.7 GHz proceeding, the
Commission determined that the clearinghouse search committee would be
composed of nine members appointed by nine entities that the Commission
found, collectively, reasonably represented the interests of the
stakeholders in the 3.7 GHz band transition. These entities represented
incumbents in the band (space station operators--three entities, and
earth station operators--three entities) as well as prospective
flexible-use licensees (three entities). The Commission determined that
the range of entities it had chosen would fairly represent the broad
interests of the relevant stakeholders in the 3.7 GHz band transition.
Since the clearinghouse search committee was not similarly identified
in the 3.45 GHz Band Second R&O, the Bureau sought comment on the
optimal number of members and which appropriate industry stakeholders
should be included on the search committee for the 3.45 GHz band
transition.
NBCUniversal and Nexstar, the two secondary, non-Federal incumbents
in the 3.45 GHz band, both seek representation on the search committee.
Due to the difference between the use and size of their operations,
NBCUniversal and Nexstar favor each company having its own seat, rather
than a shared incumbent representative. Similarly, CTIA volunteered to
represent traditional wireless providers on the search committee. CTIA
also acknowledged the need for another representative to advocate for
new entrants in the band that would not be covered by its own
membership. WIA likewise supported representation for both small- and
large-market new entrants, in addition to incumbents, suggesting two
seats for the incumbents and two for new entrants to represent small
and large auction winners. Although CCA did not initially file comments
in this portion of the proceeding, CCA has since indicated an interest
in serving on the search committee to represent the small-market
segment of new entrants.
1. Representation of Interests
The Bureau finds that equal representation of both interest groups
present in the instant transition--incumbent radiolocation systems and
new-entrant flexible-use licensees--is both consistent with the 3.7 GHz
band transition and will ensure a fair and transparent Clearinghouse
selection process in this proceeding. Specifically, each interest group
will have two seats: two incumbent seats to represent NBCUniversal's
and Nexstar's differing business models, and two new-entrant seats to
represent both small- and large-market flexible-use licensees.
First, the Bureau finds that equal representation of both interest
groups is consistent with the approach used in the 3.7 GHz band
proceeding. There, the search committee was comprised of nine members
representing three distinct interest groups: incumbent space station
operators, incumbent earth station operators, and prospective flexible-
use licensees. Each interest group received three representatives on
the search committee, which included seats for smaller and larger
interests within each interest group segment. The corollary of the 3.7
GHz band approach here is thus equal representation of the two interest
groups in the 3.45 GHz transition: non-Federal radiolocation incumbents
and new entrants, with two seats on each side. The Bureau agrees with
WIA that new entrants are a diverse group that would be best served by
representatives for both smaller and larger new entrants.
Second, the Bureau finds that equal representation will foster
compromise. By having equal representation from both interest groups on
the search committee, no one group can act unilaterally in the
selection process, ensuring that the resulting Clearinghouse fairly
facilitates the transition process. WTB agreed with WIA that having
equal representation for both interest groups on the search committee
will provide ``confidence that the clearinghouse selected remains
impartial and will seek an equitable outcome for all the parties
involved in the relocation.''
While this approach deviates from our proposal in the Search
Committee Public Notice to have an odd number of members on the search
committee, the Bureau sought comment on the optimal number of members
to include on the search committee. Further, the Bureau specifically
recognized that the 3.45 GHz relocation would be less complex than that
in the 3.7 GHz band, and suggested that a smaller committee might be
more efficient. The Bureau finds that a search committee comprised of
four members, two incumbent representatives and two new entrant
representatives, will accurately reflect the interests present in the
3.45 GHz band, is responsive to suggestions raised by commenters, and
is well-positioned to facilitate compromise. In the event that equal
representation leads to deadlock despite our instruction to proceed by
consensus, the search committee shall inform the Bureau and the Bureau
may then consider additional measures, including resolution by majority
vote or
[[Page 78575]]
appointment of an additional search committee member. The Bureau shall
act on such request within 30 days, and the search process shall
continue consistent with this final action and the Commission's rules.
The Bureau disagrees with Nexstar that the approach most consistent
with the 3.7 GHz band process would be to have two-thirds of the search
committee seats here represented by incumbent interests. While two-
thirds of the 3.7 GHz band search committee was comprised of
incumbents, the incumbent space station operators and earth station
operators represent distinct industry segments. For example, in the 3.7
GHz band space station operators provide downlink signals to various
types of earth stations, and the earth station operators in turn
deliver programming to television and radio broadcasters and telephone
and data services to consumers. Each incumbent group was given its own
equal representation on the 3.7 GHz band search committee to reflect
the differences in their interests with respect to the transition
process. The Bureau applies the same logic here, and thus have
designated equal representation of both the incumbent and new entrant
interest groups in the 3.45 GHz band.
1. Number of Seats and Membership
As discussed above, the Bureau finds that here the appropriate
implementation of equal representation is two search committee seats
for the incumbents and two for the new entrants. Specifically, the
Bureau finds that the four-member Clearinghouse search committee will
be comprised of representatives from NBCUniversal, Nexstar, CTIA, and
CCA. As proposed in the Search Committee Public Notice, each entity
shall nominate one individual to serve on the search committee. WIA,
the commenter to most directly address this issue, supports this
process, and states that such representation will promote confidence
that the selected clearinghouse will be fair to all parties in the
transition.
NBCUniversal and Nexstar, both of which volunteered to be on the
search committee, will represent their own respective interests as
secondary incumbent radiolocation service users. The Bureau finds that
CTIA and CCA together will best represent the interests of new entrants
given their diverse memberships. CTIA, which also volunteered to be on
the search committee, will represent the larger- new entrant interests
to the band. CCA indicated an interest in serving on the search
committee and will represent the interests of smaller and rural
entities.
The Bureau finds that CCA is best positioned to serve as the second
new-entrant representative on the search committee. The Bureau agrees
with WIA that the new entrants' interests are diverse and that it is
important to have the interests of smaller and rural providers
represented on the search committee. CCA notes that its members include
``small, rural carriers serving fewer than 5,000 customers'' and also
indicates that some of its members are license winners in the 3.45 GHz
band. Thus, the Bureau finds that CCA is well-situated to represent the
smaller and rural new entrants in the band.
B. Search Committee's Selection of the Clearinghouse
In the 3.7 GHz proceeding, the Commission directed the search
committee to proceed by consensus, but noted that if a vote on the
selection of a clearinghouse was required, it would be by a majority
vote. Likewise here, as proposed in the Search Committee Public Notice,
the Bureau directs the search committee to proceed by consensus. In the
event of deadlock, however, the Bureau directs the search committee to
notify the Bureau. As noted above, in the event of deadlock under the
current composition, the search committee shall inform the Bureau and
the Bureau may then consider additional measures to resolve the
deadlock. Further, the Bureau shall act on such request within 30 days
of the search committee's request, and the search process shall
continue consistent with the Commission's rules.
The Bureau requires each search committee member to certify that
they have reviewed and understand the Commission's rules and
requirements contained in this final action and the 3.45 GHz Band
Second R&O. Such certifications must be filed in the docket of this
proceeding prior to the first meeting of the selection committee, but
no later than January 5, 2023. In the event that a new search committee
member is added, its certification must be filed in the docket of this
proceeding no later than 30 days after the Bureau releases a Public
Notice identifying the new search committee member.
The search committee must meet no later than January 5, 2023. In
addition, by March 6, 2023, the search committee must release and file
with the Bureau a Request for Proposal (RFP), or similar solicitation
for Clearinghouse applications. Such solicitation must explain in
detail the selection criteria for the position of Clearinghouse and
must be consistent with the qualifications, roles, and duties of the
Clearinghouse as set forth in the Commission's rules and this final
action. Entities responding to the RFP must describe how they will
comply with these criteria and rules adopted by the Commission. The
search committee should ensure that the Clearinghouse meets the
relevant best practices and standards in its operation to ensure an
effective and efficient transition.
Thus, at a minimum, the search committee's solicitation for the
Clearinghouse must include the following requirements to: (1) engage in
strategic planning and adopt goals and metrics to evaluate its
performance; (2) adopt internal controls for its operations; (3) use
enterprise risk management practices; and (4) use best practices to
protect against improper payments and to prevent fraud, waste, and
abuse in its handling of funds. In addition, the Clearinghouse must be
required to create written procedures for its operations, using the
Government Accountability Office's (GAO) Green Book to serve as a guide
in satisfying such requirements.
CTIA asks that the selected Clearinghouse be required to enter into
contracts with stakeholders--i.e., with incumbents and new entrants.
CTIA explains that ``contracts between new 3.45 GHz Service licensees
and the Clearinghouse help ensure that the Clearinghouse's management
of clearing funds has appropriate oversight.'' CTIA notes, however,
that requiring contracts between the Clearinghouse and all stakeholders
may stall the reimbursement process if some parties are hold outs
because they lack the incentives to undertake the cost of negotiating a
contract, which could significantly exceed their reimbursement
liability. Instead, CTIA maintains that ``appropriate oversight of the
Clearinghouse can be assured by confirming that licensees covering some
reasonable proportion of the total relocation liability have negotiated
contracts with the Clearinghouse.'' In addition, CTIA proposes that
``the Clearinghouse should be required to contract with any licensee
that so desires on terms and conditions that are materially the same as
those negotiated by other licensees.''
The Bureau believe this proposal has merit and will require such
contracts here. Thus, the Bureau requires the Clearinghouse to enter
into contracts with both incumbents and sufficient licensees that hold
the majority of 3.45 GHz Service licenses. The Bureau notes that while
contracts were not required in the 3.7 GHz band context, that framework
``expected'' that contracts
[[Page 78576]]
would be entered into between the selected Clearinghouse and the
stakeholders. Accordingly, the Bureau finds that it is both consistent
with past precedent and appropriate here to require the Clearinghouse
to enter into contracts with the two incumbents and a sufficient number
of new entrant licensees holding the majority of 3.45 Service licenses.
In addition, the Clearinghouse must enter into a contract with any
licensee that so requests on terms and conditions that are materially
the same as those negotiated by other licensees. To this end, the
Bureau requires the search committee to include a requirement in its
RFP or other similar solicitation document that the selected
Clearinghouse will be required to enter into contracts with
stakeholders based on and consistent with the Commission's rules and
this final agency action, the terms of the RFP, and the applicant's
responses to the RFP, as described herein. Further, as part of its
response to the RFP, the Clearinghouse selectee must affirmatively
represent that it will enter into such contracts with two incumbents
and a sufficient number of new entrant licensees holding the majority
of 3.45 Service licenses.
The Bureau notes that CTIA also asks that such contracts ``be on
based on commercially reasonable terms for fiduciaries acting in the
capacity of the 3.45 GHz Clearinghouse'' and that the Clearinghouse
recognize ``that it owes fiduciary duties to both incumbents and new
entrants.'' The Bureau believes that requiring contracts between the
Clearinghouse and licensee stakeholders has merit in the context of
this proceeding, and such contractual relationships and obligations
will provide appropriate safeguards. Thus, the Bureau does not need to
reach a decision on CTIA's request for imposing a fiduciary duty.
The search committee's solicitation shall also require that the
Clearinghouse adopt robust privacy and data security best practices in
its operations, given that it will receive and process information
critical to ensuring a successful and expeditious transition. The
Clearinghouse shall therefore also comply with, on an ongoing basis,
all applicable laws and Federal Government guidance on privacy and
information security requirements such as relevant provisions in the
Federal Information Security Management Act (FISMA), National Institute
of Standards and Technology (NIST) publications, and Office of
Management and Budget guidance. The Clearinghouse must hire a third-
party firm to independently audit and verify, on an annual basis, the
Clearinghouse's compliance with privacy and information security
requirements and to provide recommendations based on any audit
findings; to correct any negative audit findings and adopt any
additional practices suggested by the auditor; and to report the
results to the Bureau annually beginning April 1, 2024.
The Bureau will issue a Public Notice notifying the public that the
search committee has published criteria for the selection of the
Clearinghouse. The Public Notice will announce a closing date of April
2, 2023 for submission of responses to the RFP.
The search committee shall notify the Bureau of its tentative
choice for the Clearinghouse by May 2, 2023. This notification shall:
(1) be contingent on the selectee's agreement to enter into contracts
with incumbent and new, flexible-use licensee stakeholders prior to
finalization of the selection; (2) fully disclose any actual or
potential organizational or personal conflicts of interest or
appearance of such conflict of interest of the Clearinghouse or its
officers, directors, employees, and/or contractors; and (3) set out in
detail the salary and benefits associated with each position. The
Clearinghouse shall have an ongoing obligation to update this
information as soon as possible after any relevant changes are made.
Once the search committee has notified the Bureau of its tentative
selection, the selectee must negotiate one or more contracts with
stakeholder licensees. Specifically, by July 3, 2023, the selectee must
submit negotiated and executed contracts to the search committee. The
contracts should be consistent with the requirements of this final
agency action and the Commission's rules, the RFP, and the selectee's
RFP responses. Such contracts should address issues such as any
limitations on liability, audits, and any such other commercially
reasonable terms as may be expected to be included in contracts of this
nature. After submission of contracts to the search committee, the
search committee must review the contracts for compliance with the
Commission's rules, the RFP, and the selectee's proposal by August 1,
2023. If the search committee determines contracts are in compliance,
the search committee will notify the Bureau that it has finalized the
selection of the Clearinghouse and will submit copies of the selectee's
RFP response and contracts in the docket. The Bureau acknowledges that
requiring contracts for all 3.45 GHz Service licensees to be executed
prior to the finalization of the Clearinghouse selectee may unduly
delay the selection process. Thus, if the search committee has
determined that the submitted contracts are in compliance and such
contracts have been submitted for both incumbents and sufficient
licensees that hold the majority of 3.45 GHz Service licenses, the
search committee may submit the Clearinghouse selectee for final
confirmation by the Bureau.
After receipt of the search committee's notification of its final
selection, the Bureau will issue a Public Notice announcing the entity
selected and inviting public comment on whether the selectee satisfies
the criteria set out in this final agency action and in the
Commission's rules. Following the comment period and submission of the
RFP response and contracts in the docket, the Bureau will issue a
determination as to whether the criteria for the Clearinghouse either
have or have not been satisfied. Should the Bureau be unable to find
the criteria have been satisfied, the selection process will start over
and the search committee will submit a new proposed entity. The search
committee shall remain in place at least until the Bureau issues its
determination confirming the selection of the Clearinghouse.
In the event that: (1) the Clearinghouse selectee has not reached
agreement with the two incumbent radiolocation service licensees and
sufficient licensees that hold the majority of 3.45 GHz Service
licenses; (2) the Bureau determines that the submitted contracts do not
comply with the relevant requirements; or (3) the Bureau determines
that the Clearinghouse selectee has otherwise not satisfied the
selection criteria, the Bureau may in its discretion elect to give the
parties 30 days to cure such noncompliance or instruct the search
committee to reconvene and select a new Clearinghouse candidate, thus
restarting the above process.
C. Clearinghouse Selection Process Deadlines
Consistent with the terms of this final agency action and the
Commission's rules, the Clearinghouse selection process must comply
with the following deadlines:
<bullet> January 5, 2023, or prior to first meeting: search
committee members must file certifications in WT Docket No. 19-348.
<bullet> January 5, 2023: the search committee must meet.
<bullet> March 6, 2023: the search committee must prepare and
submit the RFP to the Bureau.
[[Page 78577]]
<bullet> April 3, 2023: deadline for applicants to submit responses
to the RFP.
<bullet> May 2, 2023: the search committee must notify the Bureau
of its tentative Clearinghouse selectee.
<bullet> July 3, 2023: the Clearinghouse selectee must enter into
contracts with incumbents and new entrants and submit such contracts to
the search committee. For good cause shown, the search committee may
request one brief extension of this deadline.
<bullet> August 1, 2023: the search committee must review contracts
and notify the Bureau whether or not the contracts are approved and
whether or not the Clearinghouse selection is finalized, subject to the
Bureau determination that the selection criteria have been satisfied.
D. Duties of the Clearinghouse
Consistent with the delegation of authority in the 3.45 GHz Band
Second R&O and the Commission's rules, the Bureau herein sets forth the
duties of the Clearinghouse. As in other spectrum band transition
processes, the Bureau finds that an independent clearinghouse that
oversees the reimbursement process for the 3.45 GHz band transition in
a ``fair, and transparent manner will best serve the public interest.''
To that end, below the Bureau establishes procedures to prevent waste,
fraud, and abuse in connection with relocation reimbursement
disbursements.
Collection of reimbursement requests and supporting documentation.
The Clearinghouse will be responsible for collecting from the two
incumbent radiolocation operators a showing of their relocation costs
for the transition as well as a demonstration of the reasonableness of
those costs. The Clearinghouse will determine in the first instance
whether costs submitted for reimbursement are reasonable. Parties
seeking reimbursement for actual costs must submit to the Clearinghouse
a claim for reimbursement, complete with sufficient documentation to
justify the amount. The Clearinghouse shall review reimbursement
requests to determine whether the costs are reasonable and to ensure
they comply with the requirements adopted in the 3.45 GHz Band Second
R&O. The Clearinghouse shall give parties the opportunity to supplement
any reimbursement claims that the Clearinghouse deems deficient.
Incumbents seeking reimbursement for their actual costs shall
provide justification for those costs. The Clearinghouse shall specify
a procedure for the submission of relocation cost documentation.
Entities must document their actual expenses and shall submit such
documentation pursuant to the procedures specified by the Clearinghouse
at any time after those expenses have been incurred. The Clearinghouse
may conduct audits of entities that receive reimbursements. Incumbents
receiving reimbursements must make available all relevant documentation
upon request from the Clearinghouse.
To determine the reasonableness of reimbursement requests, the
Clearinghouse may consider the submission and supporting documentation
and any relevant comparable reimbursement submissions. If the
Clearinghouse determines that the amount sought for reimbursement is
impermissible or unreasonable, it shall notify the party of any amount
that it deems eligible for reimbursement. Approved, adjusted, or denied
claims shall be simultaneously invoiced to the relevant claimant and
the 3.45 Service licensees, allowing 30 days for review. To the extent
that either a claimant or an 3.45 Service licensee wishes to dispute a
final Clearinghouse decision, it may do so by providing written notice
to the Bureau in the above-captioned docket within 30 days of invoice
issuance. The Bureau shall resolve any such dispute. To the extent
necessary, the Bureau may establish supplemental procedures for the
resolution of any disputes that may arise during the transition. Once
the 30-day invoice review period has run and absent any dispute, the
Clearinghouse shall disburse approved claims from the reimbursement
fund.
Apportionment of Costs Among 3.45 GHz Service Licensees. The
Clearinghouse shall apportion costs among 3.45 GHz Service licensees
and distribute payments to incumbent radiolocation licensees pursuant
to the cost allocation structure established in the 3.45 GHz Band
Second R&O and the Commission's rules. Specifically, each 3.45 GHz
Service licensee that is granted an initial license (not a renewal)
``must pay a pro rata portion to reimburse the costs incurred by
authorized non-federal, secondary radiolocation licensees for
relocating from the 3.3-3.55 GHz band.'' These costs shall include
``the cost of a clearinghouse's administration of the reimbursement,
which the radiolocation licensees will pay initially and include in
their reimbursable costs.'' The Clearinghouse shall determine a
licensee's pro rata share of relocation costs by dividing the total
actual costs of the incumbents' relocation (as approved by the
Clearinghouse), ``by the total number of 3.45 GHz Service licenses
granted, multiplied by the number of such licenses [a] Licensee will
hold.'' Forty-five days after the Clearinghouse has entered into
contracts with incumbents and new licensees, the Clearinghouse shall
calculate the share of each 3.45 Service licensee based upon the
reimbursement documentation received from the incumbents. The initial
share shall incorporate any relocation-related costs incurred prior to
the issuance of new flexible-use licenses (May 4, 2022) as well as from
the time of issuance until the time of calculation. 3.45 GHz Service
licensees shall pay their share of the initial relocation payments into
a reimbursement fund, administered by the Clearinghouse, within 30 days
of receiving an invoice or other written notification of the
calculation of their initial share. The Clearinghouse shall draw from
the reimbursement fund to pay approved, invoiced claims that are not
subject to a dispute before the Bureau.
Going forward, the Clearinghouse shall calculate the 3.45 GHz
Service licensees' share of relocation costs at least every six months,
with the discretion to calculate the share on a more frequent basis as
needed, and provide each licensee with the amount it owes no more than
30 days after each period that it calculates the licensees' share of
relocation costs. Within 30 days of receiving the invoice or other
written notification of the calculation of its share, each 3.45 GHz
Service licensee shall pay its share of costs into the reimbursement
fund. The Clearinghouse shall draw from the reimbursement fund to pay
approved reimbursement claims. The Clearinghouse shall pay approved
claims 30 days after invoice submission to the relevant claimant and
3.45 GHz Service licensees for their review so long as: (1) funding is
available; and (2) there is no dispute regarding the underlying
Clearinghouse decision before the Bureau. If the reimbursement fund
does not have sufficient funds to pay approved claims before a six-
month replenishment, the Clearinghouse shall provide 3.45 GHz Service
licensees with 30 days' notice of the additional shares each must
contribute. Any interest arising from the reimbursement fund shall be
used to defray the costs of the transition for all 3.45 GHz Service
licensees on a pro rata basis. At the end of the transition, the
Clearinghouse shall return any unused amounts to the 3.45 GHz Service
licensees according to their pro rata shares.
If a 3.45 GHz Service license is relinquished to the Commission
prior to all relocation cost reimbursements being paid, the remaining
payments will be distributed among the remaining 3.45 GHz Service
licensees. If a new license
[[Page 78578]]
is issued for the previously relinquished rights prior to final
transition payments becoming due, the new 3.45 GHz Service licensee
will be responsible for the same pro rata share of relocation costs as
the initial 3.45 GHz Service licensee on a going forward basis from the
new license grant date. If a 3.45 GHz Service licensee assigns its
rights through the secondary market, the new 3.45 GHz Service licensee
will be obligated to fulfill all outstanding and future transition
payment obligations associated with the license.
3.45 GHz Service licensees will, collectively, pay for the services
of the Clearinghouse and staff. The Clearinghouse shall include and
itemize its own reasonable costs in the cost estimates it uses to
collect reimbursement fund payments from 3.45 GHz Service licensees. To
ensure the Clearinghouse's costs are reasonable, the Clearinghouse
shall provide to the Office of the Managing Director and the Wireless
Telecommunications Bureau, by April 1 of each year beginning in 2024,
an audited statement of funds expended to date, including salaries and
expenses of the Clearinghouse. It shall also provide additional
financial information as requested by the Office or Bureau to satisfy
the Commission's oversight responsibilities and/or agency-specific and
government-wide reporting obligations.
Dispute Resolution. As in the 3.7 GHz transition and consistent
with our rules, the Clearinghouse here will serve in an administrative
role and in a function similar to a special master in a judicial
proceeding. In contrast with the 3.7 GHz Band R&O (85 FR 64062, October
9, 2020), which enabled the Clearinghouse to mediate any cost disputes
or refer the parties to alternative dispute resolution fora, here the
Commission directed that any disputes arising from Clearinghouse
decisions shall be decided by the Bureau. The Bureau reiterates that to
the extent that either a claimant or a 3.45 Service licensee wishes to
dispute a final Clearinghouse decision, it may do so by providing
written notice to the Bureau in the above-captioned docket within 30
days of invoice issuance. To the extent that a 3.45 Service licensee
wishes to dispute the calculation of its pro rata contributions to the
reimbursement fund, or any transition-related payment obligation other
than a reimbursement claim invoice, it may do so by providing written
notice to the Bureau in the above-captioned docket within 30 days of
invoice issuance or other written notification of its payment
obligation. To the extent necessary, the Bureau may establish
supplemental procedures for the resolution of any disputes that may
arise during the transition.
Reports to the Bureau. The Clearinghouse shall provide certain
information and reports to the Commission to facilitate our oversight
of the transition. Each quarter, the Clearinghouse shall submit
progress reports to the Bureau that detail the status of reimbursement
funds available, the payments issued, and the amounts collected from
licensees. The first such report must be filed no later than April 1,
2024. The reports must account for all funds spent, including the
Clearinghouse's own expenses (including salaries and fees paid to law
firms, accounting firms, and other consultants). The Clearinghouse
shall provide to the Wireless Telecommunications Bureau and the Office
of the Managing Director additional information upon request.
No later than 18 months after the release of this final agency
action, the Clearinghouse must issue a special, audited report
identifying any issues that have not already been referred to the
Commission as well as what actions, if any, need to be taken for the
Clearinghouse to complete its obligations (including the estimated
costs and time frame for completing that work).
Bureau Oversight. To ensure the timely and efficient transition of
the band, the Bureau will provide the Clearinghouse with any needed
clarifications or interpretations of the Commission's rules or orders
issued by the Commission or Bureau. As noted above, the Bureau and the
Office of the Managing Director may request any documentation from the
Clearinghouse necessary to provide guidance or carry out oversight.
The Bureau will issue a Public Notice upon receipt of a request of
the Clearinghouse to wind down and suspend operations. If no material
issues are raised within 15 days of the release of said Public Notice,
the Bureau may grant the Clearinghouse's request to suspend operations
on a specific date. 3.45 GHz Service licensees must pay all transition
costs incurred and invoiced prior to the date set forth in the Public
Notice.
E. Safeguards for Clearinghouse Operation
In the 3.7 GHz Band R&O, the Commission stated that the
Clearinghouse should operate ``pursuant to Commission rules and
oversight, to mitigate financial disputes among stakeholders, and to
distribute payments in a timely manner.'' 35 FCC Rcd 2343, 2446, para.
255 (2020). In addition, the Commission concluded that it needed to
``establish measures to prevent waste, fraud, and abuse with respect to
reimbursement disbursements'' and that the Clearinghouse should adopt
``robust privacy and data security best practices in its operations.''
Id. para. 277. The Bureau agrees that such measures are likewise
appropriate as part of the 3.45 GHz transition.
CTIA proposes a series of ``appropriate safeguards'' to protect all
involved stakeholders and ``ensure the integrity of the process.''
Given the Commission's directive in this proceeding to develop and
implement a Clearinghouse selection process similar to the process used
in the 3.7 GHz proceeding, the Bureau concludes those safeguards
proposed by CTIA, which are consistent with the processes articulated
in the 3.7 GHz Band R&O, should be adopted here. Thus, the
Clearinghouse here must:
<bullet> Process claims consistent with the 3.45 GHz Band Second
R&O, and any clarifications issued by the Commission or the Bureau;
<bullet> Operate in a fair and transparent manner;
<bullet> Adopt a process for protecting confidential information;
<bullet> Hold deposits to minimize the risk of loss, (e.g., all
funds collected for reimbursement must be placed in a reputable
financial institution and may only be invested in U.S. Treasury bonds);
and
<bullet> Specify timing for the reimbursement process.
In addition, consistent with the need to prevent waste, fraud, and
abuse in its handling of reimbursement funds, all Clearinghouse
accounting related to such funds is subject to an annual audit to be
performed by an independent third party selected by the Clearinghouse.
The Clearinghouse shall report to the FCC all evidence and/or
allegations of suspected fraud, waste, or abuse related to the 3.45 GHz
relocation program, along with an initial assessment of their
credibility and substantiality. Further, the Clearinghouse shall
establish procedures enabling outside parties to report allegations of
fraud, waste, or abuse to the RPC, and maintain a log of all such
allegations that it receives. Parties seeking to report claims of
fraud, waste, and abuse directly to the FCC may do so either by phone
(202-418-1940) or electronically (<a href="/cdn-cgi/l/email-protection#f4c7c0c197989195869d9a939c9b818791b4929797da939b82"><span class="__cf_email__" data-cfemail="596a6d6c3a353c382b30373e31362c2a3c193f3a3a773e362f">[email protected]</span></a>).
To the extent that any adjustments to the Clearinghouse process or
administration are necessary going forward, the Commission delegated
authority to the Bureau to make such
[[Page 78579]]
necessary modifications. Should the Clearinghouse violate or otherwise
fail to comply with the Commission's rules, the Clearinghouse's
authority to operate may be terminated and, subject to the delegated
authority discussed above, the selection of a new clearinghouse may be
initiated.
F. CTIA Waiver Requests
CTIA requests that certain rules relating to the operation of the
Clearinghouse be waived in order to allow reimbursement payments
directly from 3.45 GHz Service licensees to incumbent radiolocation
service operators and to permit the Bureau to determine allowable costs
for reimbursement as an initial matter. If granted, CTIA's requests
would strip the Clearinghouse of its core functions--determining
reasonable reimbursement costs, billing and collecting reimbursement
funds from new entrants, and disbursing payments to incumbents--and
would reduce the Clearinghouse's role to essentially an accounting
function. The Bureau finds that CTIA's requests are not for waivers but
rather appear to seek rule changes. As such, they are essentially
untimely requests to reconsider decisions made by the Commission in the
3.45 GHz Band Second R&O and are beyond the scope of the authority
delegated to the Bureau in establishing procedures to select and
administer a Clearinghouse. The Bureau therefore dismisses CTIA's
requests.
IV. Ordering Clauses
Accordingly, it is ordered that, pursuant to sections 2, 4(i),
5(c), 157, 301, 303, 307, 308, 309, of the Communications Act of 1934,
as amended, as well as the Commercial Spectrum Enhancement Act, Public
Law 108-494, 118 Stat. 3986 (Dec. 23, 2004) as amended, and the MOBILE
NOW Act, Public Law 115-141, 132 Stat. 1098, Div. P, Title VI, sec. 603
(Mar. 23, 2018), 47 U.S.C. 152, 154(i), 155(c), 157, 301, 303, 307,
308, 309, 309(j)(3)(B), 309(j)(4)(D), 923(g), 928, 1502, by the Beat
China by Harnessing Important, National Airwaves for 5G Act of 2020,
Public Law 116-260, Division FF, Title IX, Sec. 905, and by the
authority delegated in paragraph 163 of the 3.45 GHz Second R&O, the
Order is hereby adopted.
It is further ordered, that, pursuant to the authority delegated in
Sec. Sec. 0.131 and 0.331 of the Commission's rules, 47 CFR 0.131,
0.331, CTIA's Waiver Requests are denied.
It is further ordered that the Commission's Consumer and
Governmental Affairs Bureau, Reference Information Center, shall send a
copy of the Order, including the Supplemental Final Regulatory
Flexibility Analysis, to the Chief Counsel for Advocacy of the Small
Business Administration.
It is further ordered that the Order shall be effective 30 days
after publication in the Federal Register.
Federal Communications Commission.
Amy Brett,
Acting Chief of Staff, Wireless Telecommunications Bureau.
[FR Doc. 2022-27820 Filed 12-21-22; 8:45 am]
BILLING CODE 6712-01-P
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