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Proposed Rule2026-09838

Auction of FM Broadcast Construction Permits Scheduled for February 2, 2027; Comment Sought on Competitive Bidding Procedures for Auction 114

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Published

May 15, 2026

Issuing agencies

Federal Communications Commission

Abstract

In this document, the Federal Communications Commission (the Commission or FCC) announces an auction of certain FM broadcast construction permits. The Office of Economics and Analytics (OEA) and the Media Bureau (MB) seek comment on minimum opening bid amounts and the procedures to be used for this auction, which is designated as Auction 114.

Full Text

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<title>Federal Register, Volume 91 Issue 94 (Friday, May 15, 2026)</title>
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[Federal Register Volume 91, Number 94 (Friday, May 15, 2026)]
[Proposed Rules]
[Pages 27887-27895]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2026-09838]

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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Parts 1 and 73

[AU Docket No. 26-105; DA 26-444; FR ID 346335]

Auction of FM Broadcast Construction Permits Scheduled for
February 2, 2027; Comment Sought on Competitive Bidding Procedures for
Auction 114

AGENCY: Federal Communications Commission.

ACTION: Proposed rule; proposed auction procedures.

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SUMMARY: In this document, the Federal Communications Commission (the
Commission or FCC) announces an auction of certain FM broadcast
construction permits. The Office of Economics and Analytics (OEA) and
the Media Bureau (MB) seek comment on minimum opening bid amounts and
the procedures to be used for this auction, which is designated as
Auction 114.

DATES: Comments are due on or before June 9, 2026, and reply comments
are due on or before June 24, 2026.

ADDRESSES: Pursuant to Sec. Sec. 1.415 and 1.419 of the Commission's
rules, 47 CFR 1.415, 1.419, interested parties may file comments and
reply comments on or before the dates indicated in the DATES section of
this document. Commenters are requested to also submit a copy of their
comments and reply comments electronically to the following address:
<a href="/cdn-cgi/l/email-protection#1c7d697f687573722d2d285c7a7f7f327b736a">[email&#160;protected]</a>. You may submit comments, identified by, identified
by AU Docket No. 26-105, by any of the following methods:
<bullet> Electronic Filers: Comments may be filed electronically
using the internet by accessing the Commission's Electronic Comment
Filing System (ECFS) at <a href="https://www.fcc.gov/ecfs/">https://www.fcc.gov/ecfs/</a>.
<bullet> Paper Filers: Parties who choose to file by paper must
file an original and one copy of each filing.
<bullet> Filings can be sent by hand or messenger delivery, by
commercial courier, or by the U.S. Postal Service mail. All filings
must be addressed to

[[Page 27888]]

the Commission's Secretary, Office of the Secretary, Federal
Communications Commission.
<bullet> Hand-delivered or messenger-delivered paper filings for
the Commission's Secretary are accepted between 8 a.m. and 4 p.m. by
the FCC's mailing contractor at 9050 Junction Drive, Annapolis
Junction, MD 20701. All hand deliveries must be held together with
rubber bands or fasteners. Any envelopes and boxes must be disposed of
before entering the building.
<bullet> Commercial courier mail (any not sent by the U.S. Postal
Service) must be sent to 9050 Junction Drive, Annapolis Junction, MD
20701.
<bullet> Filings sent by U.S. Postal Service First-Class Mail,
Express, and Priority mail must be sent to 45 L Street NE, Washington,
DC 20554.
<bullet> People With Disabilities: To request materials in
accessible formats for people with disabilities (braille, large print,
electronic files, audio format), send an email to <a href="/cdn-cgi/l/email-protection#e2848181d7d2d6a2848181cc858d94">[email&#160;protected]</a> or
call the Consumer and Governmental Affairs Bureau at (202) 418-0530.

FOR FURTHER INFORMATION CONTACT: Auction legal questions: Lyndsey
Grunewald, (202) 418-0660, <a href="/cdn-cgi/l/email-protection#d19da8bfb5a2b4a8ff96a3a4bfb4a6b0bdb591b7b2b2ffb6bea7">[email&#160;protected]</a>. General auction
questions: Auctions Hotline at (717) 338-2868 or <a href="/cdn-cgi/l/email-protection#f2938791869b9d9cc3c3c6b2949191dc959d84">[email&#160;protected]</a>. FM
service questions: James Bradshaw, (202) 418-2700,
<a href="/cdn-cgi/l/email-protection#064c676b63752844746762756e67714660656528616970">[email&#160;protected]</a>, Rodolfo Bonacci, (202) 418-2700,
<a href="/cdn-cgi/l/email-protection#085a676c67646e67264a6766696b6b61486e6b6b266f677e">[email&#160;protected]</a>, Lisa Scanlan, (202) 418-2700,
<a href="/cdn-cgi/l/email-protection#3f73564c5e116c5c5e51535e517f595c5c11585049">[email&#160;protected]</a>, or Ariane Rangel, (202) 418-2700,
<a href="/cdn-cgi/l/email-protection#cf8ebda6aea1aae19daea1a8aaa38fa9acace1a8a0b9">[email&#160;protected]</a>.

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's
document (Auction 114 Comment Public Notice), in AU Docket No. 26-105,
DA 26-444, released on May 11, 2026. The Auction 114 Comment Public
Notice includes the following attachment: Attachment A, Construction
Permits in Auction 114. The complete text of this document, including
its attachment, is available on the Commission's website at
<a href="http://www.fcc.gov/auction/114">www.fcc.gov/auction/114</a> or by using the search function for AU Docket
No. 26-105 on the Commission's ECFS web page at <a href="http://www.fcc.gov/ecfs">www.fcc.gov/ecfs</a>.
Paperwork Reduction Act of 1995 Analysis. The Auction 114 Comment
Public Notice seeks comment on proposed requirements that may result in
new or modified information collection requirements. The Commission, as
part of its continuing effort to reduce paperwork burdens, invites the
general public and the Office of Management and Budget to comment on
the information collection requirements contained in this document, as
required by the Paperwork Reduction Act of 1995. In addition, pursuant
to the Small Business Paperwork Relief Act of 2002, specific comment is
sought on how the Commission might further reduce the information
collection burden for small business concerns with fewer than 25
employees.
Providing Accountability Through Transparency Act. The Providing
Accountability Through Transparency Act, Pub. L. 118-9, requires each
agency, in providing notice of a rulemaking, to post online a brief
plain-language summary of the proposed rule. The required summary of
the Auction 114 Comment Public Notice is available at <a href="https://www.fcc.gov/proposed-rulemakings">https://www.fcc.gov/proposed-rulemakings</a>.
Ex Parte Requirements. This proceeding has been designated as a
``permit-but-disclose'' proceeding in accordance with the Commission's
ex parte rules. Persons making ex parte presentations must file a copy
of any written presentation or a memorandum summarizing any oral
presentation within two business days after the presentation (unless a
different deadline applicable to the Sunshine period applies). Persons
making oral ex parte presentations are reminded that memoranda
summarizing the presentations must (1) list all persons attending or
otherwise participating in the meeting at which the ex parte
presentation was made, and (2) summarize all data presented and
arguments made during the presentation. If the presentation consisted
in whole or in part of the presentation of data or arguments already
reflected in the presenter's written comments, memoranda, or other
filings in the proceeding, the presenter may provide citations to such
data or arguments in his or her prior comments, memoranda, or other
filings (specifying the relevant page and/or paragraph numbers where
such data or arguments can be found) in lieu of summarizing them in the
memorandum. Documents shown or given to the Commission staff during ex
parte meetings are deemed to be written ex parte presentations and must
be filed consistent with 47 CFR 1.1206(b). In proceedings governed by
47 CFR 1.49(f) or for which the Commission has made available a method
of electronic filing, written ex parte presentations and memoranda
summarizing oral ex parte presentations, and all attachments thereto,
must be filed through the ECFS available for that proceeding, and must
be filed in their native format (e.g., .doc, .xml, .ppt, searchable
.pdf). Participants in this proceeding should familiarize themselves
with the Commission's ex parte rules.

Synopsis

I. Introduction

1. In the Auction 114 Comment Public Notice, the Office of
Economics and Analytics (OEA) and the Media Bureau (MB) seek comment on
the procedures to be used for an auction of construction permits for
full power FM broadcast stations, which they designate as Auction 114.
The bidding for Auction 114 is tentatively scheduled to commence on
February 2, 2027.

II. Construction Permits To Be Offered in Auction 114

2. Auction 114 will offer 132 construction permits in the FM
broadcast service, including 33 construction permits that were offered
but not sold or were defaulted upon in prior auctions. Attachment A to
the Auction 114 Comment Public Notice lists the specific vacant FM
allotments for which the Commission will offer construction permits in
this auction, along with the reference coordinates for each vacant FM
allotment. The construction permits to be auctioned are for FM channels
added to the Table of FM Allotments, 47 CFR 73.202(b), pursuant to the
Commission's established rulemaking procedures, and assigned at the
indicated communities.

III. Implementation of Part 1 and Part 73 Competitive Bidding Rules and
Requirements

3. Consistent with the provisions of 47 U.S.C. 309(j)(3)(E)(i), OEA
and MB seek comment on a variety of auction-specific procedures
relating to the conduct of Auction 114.
4. The Commission's part 1 and part 73 competitive bidding rules
require each applicant seeking to bid to acquire a construction permit
in a broadcast auction to provide certain information in a short-form
application (FCC Form 175), including ownership details and numerous
certifications. The competitive bidding rules in part 1, subpart Q, and
part 73 also contain a framework for the implementation of a
competitive bidding design, application and certification procedures,
reporting requirements, and the prohibition of certain communications.

A. Certification of Notice of Auction 114 Requirements and Procedures

5. OEA and MB propose to require any party seeking to participate
in Auction 114 to certify in its short-form application, under penalty
of perjury, that it has read the public notice

[[Page 27889]]

adopting procedures for the auction and that it has familiarized itself
both with the auction procedures and with the requirements for
obtaining a construction permit for an FM station. OEA and MB believe
that this requirement, which has been implemented in other recent
auctions, would help ensure that the applicant has reviewed the
procedures for participation in the auction process and has
investigated and evaluated those technical and marketplace factors that
may have a bearing on its potential use of any permits won at auction.
Consequently, OEA and MB believe this requirement would promote an
applicant's successful participation in the auction and minimize its
risk of defaulting on its auction obligations. As with other
certifications required under 47 CFR 1.2105, an auction applicant's
failure to make the required certification in its short-form
application by the applicable filing deadline would render its
application unacceptable for filing, and its application would be
dismissed with prejudice. OEA and MB seek comment on this proposal. OEA
and MB also seek comment on whether there are additional steps the
Commission should take with respect to the filing of short-form
applications to further ensure and promote auction integrity.

B. Information Procedures During the Auction Process

6. OEA and MB propose to limit information available in Auction 114
to discourage unproductive and anti-competitive strategic behavior.
With respect to bidding, OEA and MB will not identify bidders placing
particular bids until after the bidding has closed, that is, they will
implement anonymous bidding. In addition, while OEA and MB generally
make available to the public information provided in each applicant's
short-form application following an initial review by Commission staff,
they propose to not make public until after bidding has closed: (1) the
permits that an applicant selects for bidding in its short-form
application, (2) the amount of any upfront payment made by or on behalf
of an applicant, (3) an applicant's bidding eligibility, and (4) any
other bidding-related information that might reveal the identity of the
bidder placing a bid. OEA and MB note that an applicant in a broadcast
auction that is seeking a new entrant bidding credit and has an
attributable interest in no more than three mass media facilities is
required to disclose those facilities in its short-form application and
to indicate whether any such facility is in the ``same area'' as the
permit(s) selected in its short-form application. Because this could
reveal the permits selected by an applicant, OEA and MB also propose to
not make public until after bidding has closed any applicant's response
to the question of whether a disclosed existing mass media facility is
in the ``same area'' as a selected permit.
7. Under this proposal, OEA and MB would also not make public any
real-time information on bidder-specific activity until after the close
of bidding. However, bidders would have access to additional
information related to their own bidding and bidding eligibility before
and during the bidding via the FCC auction bidding system.
8. Under this proposal, after the close of bidding, bidders' permit
selections, upfront payment amounts, bidding eligibility, bids, and
other bidding-related information would be made publicly available.
9. OEA and MB seek comment on the above details of their proposal
for implementing limited information procedures, or anonymous bidding,
in Auction 114. Commenters opposing the use of limited information
procedures in Auction 114 should explain their reasoning and propose
alternative information rules.

C. Upfront Payments and Bidding Eligibility

10. In keeping with the usual practice in spectrum auctions, OEA
and MB propose that applicants be required to submit upfront payments
as a prerequisite to becoming qualified to bid. As described below, the
upfront payment is a refundable deposit made by an applicant to
establish its eligibility to bid on construction permits. Upfront
payments protect against frivolous or insincere bidding and provide the
Commission with a source of funds from which to collect payments owed
at the close of the bidding.
11. OEA and MB seek comment on an appropriate upfront payment for
each construction permit being auctioned, taking into account such
factors as the efficiency of the auction process and the potential
value of similar construction permits. With these considerations in
mind, OEA and MB propose the upfront payments set forth in Attachment A
to the Auction 114 Comment Public Notice and seek comment on those
proposed upfront payment amounts.
12. OEA and MB further propose that the amount of the upfront
payment submitted by a bidder will determine its initial bidding
eligibility in bidding units, which are a measure of bidder eligibility
and bidding activity. OEA and MB propose to assign each construction
permit a specific number of bidding units, equal to one bidding unit
per dollar of the upfront payment listed in Attachment A on the Auction
114 website at <a href="http://www.fcc.gov/auction/114">www.fcc.gov/auction/114</a>. The number of bidding units for
a given construction permit is fixed and does not change during the
auction as prices change. If an applicant is found to be qualified to
bid on more than one permit being offered in Auction 114, such bidder
may place bids on multiple construction permits, provided that the
total number of bidding units associated with those construction
permits does not exceed that bidder's current eligibility. A bidder
cannot increase its eligibility during the auction; it can only
maintain or decrease its eligibility. In calculating its upfront
payment amount, and hence its initial bidding eligibility, an applicant
must determine the maximum number of bidding units on which it may wish
to bid (or hold provisionally winning bids) in any single round and
submit an upfront payment amount covering that total number of bidding
units. OEA and MB request comment on these proposals.

Example--Upfront Payments, Bidding Eligibility, and Bidding Flexibility
----------------------------------------------------------------------------------------------------------------
Construction permit Market name Bidding units Upfront payment
----------------------------------------------------------------------------------------------------------------
MM-FM1228-A................................ Keeseville, NY............... 25,000 $25,000
MM-FM1232-A................................ Wayne, OK.................... 10,000 10,000
----------------------------------------------------------------------------------------------------------------
If a bidder wishes to bid on both construction permits in a round, it must have selected both on its FCC Form
175 and purchased at least 35,000 bidding units (25,000 + 10,000) of bidding eligibility. If it only wishes to
bid on one, but not both, purchasing 25,000 bidding units would meet the eligibility requirement for either
construction permit, and consequently the bidder would be able to bid on either construction permit, but not
both at the same time. If the bidder purchased only 10,000 bidding units, the bidder would have enough
eligibility for the Wayne, OK construction permit but not for the Keeseville, NY construction permit.

[[Page 27890]]

D. Minimum Opening Bids or Reserve Prices

13. As part of the pre-bidding process for each auction, OEA and MB
seek comment on the use of a minimum opening bid amount and/or reserve
price, as mandated by the Act. OEA and MB propose to establish minimum
opening bid amounts for Auction 114. Based on their experience in past
broadcast auctions, OEA and MB have found that setting a minimum
opening bid amount judiciously is an effective bidding tool for
accelerating the competitive bidding process. In the most recent FM
broadcast auction, Auction 109, OEA and MB similarly proposed
establishing minimum opening bids but not reserve prices; in that
auction, no comments opposed the proposal, and OEA and MB adopted it.
Based on these facts, OEA and MB propose establishing minimum opening
bids for Auction 114. OEA and MB do not propose to establish separate
reserve prices for any of the construction permits to be offered in
Auction 114, nor do they see any reason to propose an aggregate reserve
price for this auction.
14. For Auction 114, OEA and MB propose minimum opening bid amounts
determined by taking into account the type of service and class of
facility offered, market size, population covered by the proposed
broadcast facility, and recent broadcast transaction data, to the
extent such information is available. OEA and MB seek comment on the
proposed minimum opening bid amounts for Auction 114, which are
specified in Attachment A on the Auction 114 website at <a href="http://www.fcc.gov/auction/114">www.fcc.gov/auction/114</a>. If commenters believe that these minimum opening bid
amounts will result in unsold construction permits, are not reasonable
amounts at which to start bidding, or should not preclude lower bids
but instead operate as a form of reserve prices, they should explain
why this is so and comment on the desirability of an alternative
approach. Commenters should support their claims with valuation
analyses and provide suggested amounts or formulas in connection with
their proposed alternatives. In establishing the minimum opening bid
amounts, OEA and MB particularly seek comment on factors that could
reasonably have an impact on bidders' valuation of the broadcast
spectrum, including the type of service and class of facility offered,
market size, population covered by the proposed FM broadcast facility,
and any other relevant factors. Commenters also may wish to address the
general role of minimum opening bids in managing the pace of the
auction. For example, commenters could compare using minimum opening
bids--e.g., by setting higher minimum opening bids to reduce the number
of rounds it takes for construction permits to reach their final
prices--to other means of controlling auction pace, such as changes to
bidding schedules, percentage increments, or activity requirements.

E. Auction Delay, Suspension, or Cancellation

15. For Auction 114, OEA and MB propose that at any time before or
during the bidding process, they may delay, suspend, or cancel bidding
in the auction in the event of a natural disaster, technical obstacle,
network interruption, administrative or weather necessity, evidence of
an auction security breach or unlawful bidding activity, or for any
other reason that affects the fair and efficient conduct of competitive
bidding. OEA and MB will notify participants of any such delay,
suspension, or cancellation by public notice and/or through the FCC
auction bidding system's messages function. If bidding is delayed or
suspended, OEA and MB may, in their sole discretion, elect to resume
the auction starting from the beginning of the current round or from
some previous round, or cancel the auction in its entirety. OEA and MB
emphasize that they will exercise this authority solely at their
discretion, and not as a substitute for situations in which bidders may
wish to apply activity rule waivers. OEA and MB seek comment on this
proposal.

F. Additional Default Payment Percentage

16. Any winning bidder that defaults or is disqualified after the
close of an auction (i.e., fails to remit the required down payment by
the specified deadline, fails to submit a timely long-form application,
fails to make a full and timely final payment, or is otherwise
disqualified) is liable for a default payment under 47 CFR
1.2104(g)(2). This payment consists of a deficiency payment, equal to
the difference between the amount of the Auction 114 bidder's winning
bid and the amount of the winning bid the next time a construction
permit covering the same spectrum is won in an auction, plus an
additional payment equal to a percentage of the defaulter's bid or of
the subsequent winning bid, whichever is less.
17. The Commission's rules provide that, in advance of each
auction, it will establish a percentage between 3% and 20% of the
applicable winning bid to be assessed as an additional default payment.
As the Commission has indicated, the level of this additional payment
in each auction will be based on the nature of the service and the
construction permits being offered.
18. For Auction 114, OEA and MB propose to establish an additional
default payment of 20%, which is consistent with the percentage in
prior auctions of broadcast construction permits. As the Commission has
noted, defaults weaken the integrity of the auction process and may
impede the deployment of service to the public, and an additional 20%
default payment will be more effective in deterring defaults than the
3% used in some earlier auctions. In light of these considerations, OEA
and MB propose for Auction 114 an additional default payment of 20% of
the relevant bid. OEA and MB seek comment on this proposal.

IV. Proposed Bidding Procedures

A. Simultaneous Multiple-Round Auction Design

19. OEA and MB propose to use the Commission's simultaneous
multiple-round auction format for Auction 114. As described further
below, this type of auction offers every construction permit for bid at
the same time and consists of successive bidding rounds in which
qualified bidders may place bids on individual construction permits. In
this type of auction, which OEA and MB have used in all recent
broadcast auctions, bidding typically remains open on all construction
permits until bidding stops on every construction permit. OEA and MB
seek comment on this proposal.

B. Bidding Rounds

20. Under OEA's and MB's proposal, Auction 114 will consist of
sequential bidding rounds, each of which would be followed by the
release of round results. A bidder will be able to place, and remove, a
bid during a round, but will not be able to withdraw the bid once the
round closes. The initial bidding schedule will be announced in a
public notice to be released at least one week before the start of
bidding. Details on viewing round results, including the location and
format of downloadable round results files for each round, will be
included in that same public notice.
21. OEA and MB propose that the initial bidding schedule may be
adjusted in order to foster an auction pace that reasonably balances
speed with the bidders' need to study round results and adjust their
bidding strategies. Under this proposal, such changes may include the
amount of time

[[Page 27891]]

for the bidding rounds, the amount of time between rounds, or the
number of rounds per day, depending upon bidding activity and other
factors. OEA and MB seek comment on this proposal. Commenters should
address the efficacy of the bidding schedule in managing the pace of
the auction. Specifically, commenters should compare and contrast
changes to the bidding schedule with changes to other parameters used
to manage the auction's pace, such as the activity requirement or bid
amount parameters.
22. The Commission will conduct Auction 114 over the internet using
the FCC auction bidding system. A bidder will also have the option of
placing bids by telephone through a dedicated auction bidder line.

C. Stopping Rule

23. OEA and MB have discretion to establish stopping rules before
or during multiple round auctions in order to complete the auction
within a reasonable time. For Auction 114, OEA and MB propose to employ
a simultaneous stopping rule approach, which means all construction
permits remain available for bidding until bidding stops on every
construction permit. Specifically, bidding will close on all
construction permits after the first round in which no bidder submits
any new bid on a construction permit for which the bidder is not the
provisionally winning bidder. Consequently, under this approach, it is
not possible to determine in advance how long the bidding in this
auction will last.
24. In certain circumstances, for example, where the auction is
proceeding unusually slowly or quickly, there is minimal overall
bidding activity, or it appears likely that the auction will not close
within a reasonable period of time or will close prematurely, OEA and
MB are likely to attempt to change the pace of the auction. For
example, OEA and MB may adjust the pace of bidding by changing the
number of bidding rounds per day or the minimum acceptable bids. OEA
and MB propose to retain the discretion to exercise any of these
options with or without prior announcement during the auction. OEA and
MB seek comment on these proposals. Commenters should provide specific
reasons for supporting or objecting to these proposals.

D. Availability of Bidding Information

25. OEA and MB intend to make available, after each round closes,
for each permit its current provisionally winning bid amount, the
minimum acceptable bid amount for the following round, and the number
of bids placed on the permit during the round. These reports would be
publicly accessible. Moreover, after the auction closes, OEA and MB
propose to make available complete reports of all bids placed during
each round of the auction, including bidder identities.
26. OEA and MB also will provide bidders with secure access to
certain non-public bidding information while bidding is ongoing.
Specifically, after each round ends, and before the next round begins,
OEA and MB will make the following information available to individual
bidders:
<bullet> The bidder's activity, based on all bids in the previous
round; and
<bullet> Summary statistics of the bidder's bidding and other
bidding-related actions in each round, including the permits on which
it bid and the price it bid for each of those permits, the result of
each of its bids, whether it has any provisionally winning bids, and
remaining activity rule waivers.
27. OEA and MB believe that limiting the availability of bidding
information during the auction balances their interest in providing
bidders with sufficient information about the status of their own bids
and the general level of bidding on all permits to allow them to bid
confidently and effectively, while restricting the availability of
information that may facilitate identification of bidders placing
particular bids, which could potentially lead to undesirable strategic
bidding. OEA and MB seek comment on this view.

E. Activity Rule

28. To ensure that the auction closes within a reasonable period of
time, an activity rule requires bidders to bid actively throughout the
auction, rather than wait until late in the auction before
participating. For purposes of the activity rule, the FCC auction
bidding system calculates a bidder's activity in a round as the sum of
the bidding units associated with any construction permits upon which
the bidder places bids during the current round and the bidding units
associated with any construction permits for which the bidder holds
provisionally winning bids. Bidders are required to be active on a
specific percentage of their current bidding eligibility during each
round of the auction. OEA and MB propose that in each bidding round, a
bidder desiring to maintain its current bidding eligibility be required
to be active on 100% of its bidding eligibility. Thus, the activity
requirement would be satisfied when a bidder has bidding activity on
construction permits with bidding units that sum to 100% of the
bidder's current eligibility in the round. If the activity rule is met,
then the bidder's eligibility does not change in the next round.
Failure to maintain the requisite activity level will result in the use
of an activity rule waiver, if any remain, or a reduction in the
bidder's eligibility for the next round of bidding, possibly curtailing
or eliminating the bidder's ability to place additional bids in the
auction. OEA and MB seek comment on this proposal. OEA and MB encourage
commenters that oppose a 100% activity requirement to explain their
reasons with specificity.

F. Activity Rule Waivers and Reducing Eligibility

29. For their proposed simultaneous multiple-round auction format,
OEA and MB propose that when a bidder's activity in the current round
is below the required minimum level, the bidder may preserve its
current level of eligibility through an activity rule waiver, if
available. An activity rule waiver applies to an entire round of
bidding, not to a particular construction permit. Activity rule waivers
are primarily a mechanism for a bidder to avoid the loss of bidding
eligibility in the event that exigent circumstances prevent it from
bidding in a particular round.
30. The FCC auction bidding system will assume that a bidder that
does not meet the activity requirement would prefer to use an activity
rule waiver (if available) rather than lose bidding eligibility.
Therefore, the system will automatically apply a waiver at the end of
any bidding round in which a bidder's activity level is below the
minimum required level unless: (1) the bidder has no activity rule
waiver remaining; or (2) the bidder overrides the automatic application
of a waiver by electing to reduce eligibility, thereby meeting the
activity requirement. If a bidder has no waivers remaining and does not
satisfy the required activity level, the bidder's current eligibility
will be permanently reduced, possibly curtailing or eliminating the
ability to place additional bids in the auction.
31. A bidder with insufficient activity may wish to reduce its
bidding eligibility rather than use an activity rule waiver. If so, the
bidder must affirmatively override the automatic waiver mechanism
during the bidding round by using the reduce eligibility function in
the FCC auction bidding system. In this case, the bidder's eligibility
would be permanently reduced to bring it into compliance with the
activity rule described above. Reducing eligibility is an irreversible

[[Page 27892]]

action; once eligibility has been reduced, a bidder cannot regain its
lost bidding eligibility.
32. Consistent with prior Commission auctions of broadcast
construction permits, OEA and MB propose that each bidder in Auction
114 be provided with three activity rule waivers that may be used as
set forth above at the bidder's discretion during the course of the
auction. OEA and MB seek comment on this proposal.

G. Bid Amounts

33. OEA and MB propose that, in each round, a qualified bidder will
be able to place a bid on a given construction permit in any of up to
nine different amounts: the minimum acceptable bid amount or one of
eight additional bid amounts.
34. Minimum Acceptable Bid Amounts. The first of the acceptable bid
amounts is called the minimum acceptable bid amount. The minimum
acceptable bid amount for a construction permit will be equal to its
minimum opening bid amount until there is a provisionally winning bid
for the construction permit. Once there is a provisionally winning bid
for a construction permit, the minimum acceptable bid amount for that
construction permit will be equal to the amount of the provisionally
winning bid plus a specified percentage of that bid amount. The
percentage used for this calculation, the minimum acceptable bid
increment percentage, is multiplied by the provisionally winning bid
amount, and the resulting amount is added to the provisionally winning
bid amount. If, for example, the minimum acceptable bid increment
percentage is 10%, then the provisionally winning bid amount is
multiplied by 10%. The result of that calculation is added to the
provisionally winning bid amount, and that sum is rounded using the
Commission's standard rounding procedure for auctions.
35. Additional Bid Amounts. Under this proposal, the Commission
will calculate the eight additional bid amounts using the minimum
acceptable bid amount and an additional bid increment percentage. The
minimum acceptable bid amount is multiplied by the additional bid
increment percentage, and that result (rounded) is the additional
increment amount. The first additional acceptable bid amount equals the
minimum acceptable bid amount plus the additional increment amount. The
second additional acceptable bid amount equals the minimum acceptable
bid amount plus two times the additional increment amount; the third
additional acceptable bid amount is the minimum acceptable bid amount
plus three times the additional increment amount; etc. If, for example,
the additional bid increment percentage is 5%, then the calculation of
the additional increment amount would be (minimum acceptable bid
amount) * (0.05), rounded. The first additional acceptable bid amount
equals (minimum acceptable bid amount) + (additional increment amount);
the second additional acceptable bid amount equals (minimum acceptable
bid amount) + (2 * (additional increment amount)); the third additional
acceptable bid amount equals (minimum acceptable bid amount) + (3 *
(additional increment amount)); etc.
36. For Auction 114, OEA and MB propose to use a minimum acceptable
bid increment percentage of 10%. This means that the minimum acceptable
bid amount for a construction permit will be approximately 10% greater
than the provisionally winning bid amount for the construction permit.
To calculate the additional acceptable bid amounts, OEA and MB propose
to use a bid increment percentage of 5%. OEA and MB have used a minimum
acceptable bid increment percentage of 10% coupled with an additional
bid increment percentage of 5% in past broadcast auctions and have
found that these percentages allow bidders to express their valuations
in sufficient granularity while also assuring that the auction moves at
a satisfactory pace. OEA and MB seek comment on these proposals.
37. Bid Amount Changes. OEA and MB propose to retain the discretion
to change the minimum acceptable bid amounts, the minimum acceptable
bid increment percentage, the additional bid increment percentage, and
the number of acceptable bid amounts if they determine, consistent with
past practice, that circumstances so dictate. OEA and MB propose to
retain the discretion to do so on a construction permit-by-construction
permit basis. OEA and MB also propose to retain the discretion to
limit, in dollars, (a) the amount by which a minimum acceptable bid for
a construction permit may increase compared with the corresponding
provisionally winning bid, and (b) the amount by which an additional
bid amount may increase compared with the immediately preceding
acceptable or additional bid amount. For example, OEA and MB could set
a $1,000 limit on increases in minimum acceptable bid amounts over
provisionally winning bids. In this example, if calculating a minimum
acceptable bid using the minimum acceptable bid increment percentage
results in a minimum acceptable bid amount that is $1,200 higher than
the provisionally winning bid on a construction permit, the minimum
acceptable bid amount would instead be capped at $1,000 above the
provisionally winning bid. OEA and MB seek comment on the circumstances
under which they should employ such a limit, factors OEA and MB should
consider when determining the dollar amount of the limit, and the
tradeoffs in setting such a limit or changing other parameters, such as
changing the minimum acceptable bid increment percentage, the
additional bid increment percentage, or the number of acceptable bid
amounts. If OEA and MB exercise this discretion, they will alert
bidders by announcement in the FCC auction bidding system during the
auction.
38. OEA and MB seek comment on these proposals. If commenters
disagree with the proposal to begin the auction with nine acceptable
bid amounts per construction permit, they should suggest an alternative
number of acceptable bid amounts to use. Commenters may wish to address
the role of the minimum acceptable bids and the number of acceptable
bid amounts in managing the pace of the auction, and compare how these
parameters manage the auction's pace relative to decisions regarding
the bidding schedule, activity requirement, minimum opening bid
amounts, or other parameters.

H. Provisionally Winning Bids

39. The FCC auction bidding system will determine provisionally
winning bids consistent with practice in past auctions. Specifically,
at the end of a bidding round, the bidding system will determine a
provisionally winning bid for each construction permit based on the
highest bid amount received for that permit. The FCC auction bidding
system will advise bidders of the status of their bids when round
results are released. A provisionally winning bid cannot be withdrawn
and will remain the provisionally winning bid until there is a higher
bid on the same construction permit at the close of a subsequent round.
Provisionally winning bids at the end of the auction become the winning
bids. As a reminder, provisionally winning bids count toward activity
for purposes of the activity rule.
40. The FCC auction bidding system assigns a pseudo-random number
generated by an algorithm to each bid when the bid is entered. If
identical high bid amounts are submitted on a construction permit in
any given round (i.e., tied bids), the FCC auction bidding system will
use a pseudo-random number generator to select a single

[[Page 27893]]

provisionally winning bid from among the tied bids. The tied bid with
the lowest pseudo-random number wins the tiebreaker and becomes the
provisionally winning bid. The remaining bidders, as well as the
provisionally winning bidder, can submit higher bids in subsequent
rounds. However, if the auction were to end with no other bids being
placed, the winning bidder would be the one that placed the
provisionally winning bid. If the construction permit receives any bids
in a subsequent round, the provisionally winning bid again will be
determined by the highest bid amount received for the construction
permit.

V. Tutorial and Additional Information for Applicants

41. The Commission intends to provide additional information on the
bidding system and to offer demonstrations and other educational
opportunities for applicants in Auction 114 to familiarize themselves
with the FCC auction application system and the auction bidding system.
For example, OEA and MB intend to release an online tutorial that will
help applicants understand the procedures to be followed in the filing
of their short-form applications and on the bidding procedures for
Auction 114.

VI. Initial Regulatory Flexibility Analysis

42. As required by the Regulatory Flexibility Act of 1980, as
amended (RFA), the Commission prepared Initial Regulatory Flexibility
Analyses (IRFAs) in connection with the Broadcast Competitive Bidding
Notice of Proposed Rulemaking (NPRM), 62 FR 65392, December 12, 1997,
and other Commission NPRMs (collectively, Competitive Bidding NPRMs)
pursuant to which Auction 114 will be conducted. Final Regulatory
Flexibility Analyses (FRFAs) likewise were prepared in the Broadcast
Competitive Bidding Order, 63 FR 48615, September 11, 1998, and other
Commission rulemaking orders (collectively, Competitive Bidding Orders)
pursuant to which Auction 114 will be conducted. OEA and MB have
prepared this Initial Regulatory Flexibility Analysis (IRFA) of the
procedures proposed in the Auction 114 Comment Public Notice, assessing
the possible significant economic impact on a substantial number of
small entities. The Commission requests written public comments on the
IRFA. Comments must be identified as responses to the IRFA and must be
filed by the same deadlines for comments specified in the DATES section
of this document. The Commission will send a copy of the Auction 114
Comment Public Notice, including this IRFA, to the Chief Counsel for
the Small Business Administration (SBA) Office of Advocacy.
43. Need for, and Objectives of, the Proposed Procedures. The
proposed procedures for the conduct of Auction 114 as described in the
Auction 114 Comment Public Notice would constitute the more specific
implementation of the competitive bidding rules contemplated by parts 1
and 73 of the Commission's rules, adopted by the Commission in multiple
notice-and-comment rulemaking proceedings, including the delegation of
authority to establish additional procedures to be adopted prior to a
broadcast auction. The Auction 114 Comment Public Notice seeks comment
on proposed procedures, terms, and conditions governing Auction 114,
including the minimum opening bid amounts for the specified
construction permits, and is fully consistent with the underlying
rulemaking orders, including the Broadcast Competitive Bidding Order
and other relevant competitive bidding orders.
44. The Auction 114 Comment Public Notice provides notice to
Auction 114 applicants, some of which are small entities, of proposed
auction procedures and provides adequate time for applicants to comment
on those proposed procedures. To promote the efficient and fair
administration of the competitive bidding process for all Auction 114
participants, the Auction 114 Comment Public Notice seeks comment on
the following proposed procedures:
<bullet> A requirement that any applicant seeking to participate in
Auction 114 certify in its short-form application, under penalty of
perjury, that it has read the public notice adopting procedures for
Auction 114 that will be released in advance of the short-form
application deadline, and that it has familiarized itself with those
procedures and the requirements for obtaining a construction permit for
an FM station;
<bullet> Use of anonymous bidding/limited information procedures,
which will not make public until after bidding has closed: (1) the
permits that an applicant selects for bidding in its short-form
application, (2) the amount of any upfront payment made by or on behalf
of an applicant, (3) any applicant's bidding eligibility, and (4) any
other bidding-related information that might reveal the identity of the
bidder placing a bid;
<bullet> Establishment of an additional default payment of 20%
under 47 CFR 1.2104(g)(2) in the event a winning bidder defaults or is
disqualified after the auction closes;
<bullet> Use of a simultaneous multiple-round auction format,
consisting of sequential bidding rounds with a simultaneous stopping
rule;
<bullet> Provision of delegated authority to OEA, in conjunction
with MB, to exercise its discretion to delay, suspend, or cancel
bidding in Auction 114 for any reason that affects the ability of the
competitive bidding process to be conducted fairly and efficiently;
<bullet> Retention by OEA of discretion to adjust the bidding
schedule in order to manage the pace of Auction 114;
<bullet> A specific minimum opening bid amount for each
construction permit to be offered in this auction;
<bullet> A specific number of bidding units for each construction
permit;
<bullet> A specific upfront payment amount for each construction
permit;
<bullet> Establishment of a bidder's initial bidding eligibility in
bidding units based on that bidder's upfront payment;
<bullet> Establishment of an activity rule requiring the bidder to
be active on 100% of its bidding eligibility in each bidding round;
<bullet> Provision of three activity waivers for each bidder to
allow it to preserve eligibility during the course of the auction;
<bullet> Use of minimum acceptable bid amounts and additional bid
increments, along with a proposed methodology for calculating such
amounts, while retaining discretion to change the methodology if
circumstances dictate; and
<bullet> A procedure for breaking ties if identical high bid
amounts are submitted on a construction permit in a given round.
45. Legal Basis. The Commission's statutory obligations to small
businesses participating in a spectrum license auction under the Act
are found in 47 U.S.C. 309(j)(3)(B) and 309(j)(4)(D). The statutory
basis for the Commission's competitive bidding rules is found in
various provisions of the Act, including 47 U.S.C. 154(i), 301, 303(e),
303(f), 303(r), 304, 307, and 309(j). The Commission has established a
framework of competitive bidding rules pursuant to which it has
conducted auctions since the inception of the auction program in 1994
and would conduct Auction 114. The Commission has directed that OEA and
MB, under delegated authority, seek comment on a variety of auction-
specific procedures prior to the start of bidding in each auction.
46. Description and Estimate of the Number of Small Entities to
Which the

[[Page 27894]]

Proposed Procedures Will Apply. The RFA directs agencies to provide a
description of and, where feasible, an estimate of the number of small
entities that may be affected by the proposed procedures, if adopted.
The RFA generally defines the term ``small entity'' as having the same
meaning as the terms ``small business,'' ``small organization,'' and
``small government jurisdiction.'' In addition, the term ``small
business'' has the same meaning as the term ``small business concern''
under the Small Business Act. A ``small business concern'' is one
which: (1) is independently owned and operated, (2) is not dominant in
its field of operation, and (3) satisfies any additional criteria
established by the SBA. The SBA establishes small business size
standards that agencies are required to use when promulgating
regulations relating to small businesses; agencies may establish
alternative size standards for use in such programs, but must consult
and obtain approval from SBA before doing so.
47. OEA's and MB's actions, over time, may affect small entities
that are not easily categorized at present. OEA and MB therefore
describe three broad groups of small entities that could be directly
affected by their actions. In general, a small business is an
independent business having fewer than 500 employees. These types of
small businesses represent 99.9% of all businesses in the United
States, which translates to 34.75 million businesses. Next, ``small
organizations'' are not-for-profit enterprises that are independently
owned and operated and not dominant in their field. While OEA and MB do
not have data regarding the number of non-profits that meet that
criteria, over 99 percent of nonprofits have fewer than 500 employees.
Finally, ``small governmental jurisdictions'' are defined as cities,
counties, towns, townships, villages, school districts, or special
districts with populations of less than fifty thousand. Based on the
2022 U.S. Census of Governments data, OEA and MB estimate that at least
48,724 out of 90,835 local government jurisdictions have a population
of less than 50,000.
48. The specific procedures and minimum opening bid amounts on
which comment is sought in the Auction 114 Comment Public Notice will
directly affect all applicants participating in Auction 114. The number
of entities that may apply to participate in Auction 114 is unknown.
Based on the number of applicants in prior FM auctions, OEA and MB
estimate that the number of applicants for Auction 114 may range from
approximately 130 to 260. This estimate is based on the number of
applicants who filed short-form applications to participate in previous
open auctions of FM construction permits held to date, an average of
1.7 short-form applications were filed per construction permit offered,
with a median of 1.2 applications per permit. The actual number of
applicants for Auction 114 could vary significantly as any individual's
or entity's decision to participate may be affected by a number of
factors beyond the Commission's control.
49. The proposed procedures in the Auction 114 Comment Public
Notice will apply to small entities in the industries identified in the
chart below by their six-digit North American Industry Classification
System (NAICS) codes and corresponding SBA size standard. Where
available, OEA and MB also provide additional information regarding the
number of potentially affected entities in the industries identified
below.

Table 1--2022 U.S. Census Bureau Data by NAICS Code
--------------------------------------------------------------------------------------------------------------------------------------------------------
SBA size
Regulated Industry (Footnotes specify potentially affected entities NAICS code standard Total firms Total small % Small firms
within a regulated industry where applicable) (millions) firms
--------------------------------------------------------------------------------------------------------------------------------------------------------
Radio Broadcasting Stations........................................ 516110 $47 2,616 2,136 81.65
--------------------------------------------------------------------------------------------------------------------------------------------------------

Table 2--Broadcast Entity Data
----------------------------------------------------------------------------------------------------------------
Broadcast Station Owners (as of August 8, 2025) SBA size standard ($47 Million)
----------------------------------------------------------------------------------------------------------------
Number of
Affected entity commercial Small firms % Small
licensed entities
----------------------------------------------------------------------------------------------------------------
Radio Stations (AM & FM) Groups.............................. 2,881 2,863 99.38
----------------------------------------------------------------------------------------------------------------

50. Description of Economic Impact and Projected Reporting,
Recordkeeping, and Other Compliance Requirements for Small Entities.
The RFA directs agencies to describe the economic impact of proposed
rules on small entities, as well as projected reporting, recordkeeping
and other compliance requirements, including an estimate of the classes
of small entities which will be subject to the requirements and the
type of professional skills necessary for preparation of the report or
record.
51. In the Auction 114 Comment Public Notice, OEA and MB do not
propose any new reporting, recordkeeping, or other compliance
requirements for small entities or other auction applicants. Moreover,
the auction application process is designed to minimize reporting and
compliance requirements for applicants, some of which are small
entities. To participate in this auction, parties will file
streamlined, short-form applications in which they certify their
qualifications under penalty of perjury. Eligibility to participate in
bidding is based on an applicant's short-form application and
certifications, as well as its upfront payment. In the second phase of
the auction process, there are additional compliance requirements for
winning bidders. Thus, a small business that fails to become a winning
bidder does not need to file a long-form application and provide the
additional showings and more detailed demonstrations required of a
winning bidder.
52. OEA and MB do not expect the processes and procedures proposed
in the Auction 114 Comment Public Notice will require small entities to
hire attorneys, engineers, consultants, or other professionals to
participate in Auction 114 and comply with the procedures they
ultimately adopt because of the information, resources, and guidance
OEA and MB make available to potential and actual

[[Page 27895]]

participants at no cost. For example, OEA and MB intend to release an
online tutorial that will help applicants understand the procedures for
filing the short-form application (FCC Form 175). OEA and MB also
intend to make information on the bidding system available and to offer
demonstrations and other educational opportunities for applicants in
Auction 114 to familiarize themselves with the FCC auction application
system and the auction bidding system. By providing these resources, as
well as the resources discussed below, OEA and MB expect small entities
who use the available resources to experience lower participation and
compliance costs. Nevertheless, while OEA and MB cannot quantify the
cost of compliance with the proposed procedures, they do not believe
that the costs of compliance will unduly burden small entities that
choose to participate in the auction because the proposals for Auction
114 are similar in many respects to the procedures in recent broadcast
auctions conducted by the Commission.
53. Discussion of Significant Alternatives Considered That Minimize
the Significant Economic Impact on Small Entities. The RFA directs
agencies to provide a description of any significant alternatives to
the proposed rules that would accomplish the stated objectives of
applicable statutes, and minimize any significant economic impact on
small entities. The discussion is required to include alternatives such
as: ``(1) the establishment of differing compliance or reporting
requirements or timetables that take into account the resources
available to small entities; (2) the clarification, consolidation, or
simplification of compliance and reporting requirements under the rule
for such small entities; (3) the use of performance rather than design
standards; and (4) an exemption from coverage of the rule, or any part
thereof, for such small entities.''
54. In the Auction 114 Comment Public Notice, the Commission sets
forth proposals to facilitate participation in Auction 114 and result
in both operational and administrative cost savings for small entities
and other auction participants. In developing these proposals, OEA and
MB also consider alternatives that could minimize significant economic
impact on small entities. For example, given the numerous resources
that will be made available from the Commission at no cost, the
processes and procedures proposed in the Auction 114 Comment Public
Notice should result in minimal economic impact on small entities.
Prior to the start of bidding, the Commission will hold a mock auction
to allow qualified bidders the opportunity to familiarize themselves
with both the bidding processes and systems that will be used in
Auction 114. During the auction, participants will be able to access
and participate in bidding via the internet using a web-based system,
or telephonically, providing two cost-effective methods of
participation and avoiding the cost of travel for in-person
participation. Further, small entities as well as other auction
participants will be able to avail themselves of a telephone hotline
for assistance with auction processes and procedures as well as a
telephone technical support hotline to assist with issues such as
access to or navigation within the electronic FCC Form 175 and use of
the FCC's auction system. All auction participants, including small
business entities, will also have access to various other sources of
information and databases through the Commission that will aid in both
their understanding of and participation in the process. These
mechanisms are made available to facilitate participation by all
qualified bidders and may result in significant cost savings for small
business entities that utilize these mechanisms. Alternatively, OEA and
MB consider other ways in which to assist small entities, many of which
have limited resources, to more efficiently participate in Auction 114
and seek comment on such proposals. These steps, coupled with the
advanced description of the bidding procedures, should ensure that the
auction will be administered efficiently and fairly, thus providing
certainty for small entities.
55. In addition, consistent with previous Commission auctions of
broadcast construction permits, the Auction 114 Comment Public Notice
proposes that each bidder in Auction 114 be provided with three
activity rule waivers, which serve to allow the bidder to avoid the
loss of bidding eligibility should exigent circumstances prevent it
from bidding in a particular round. These waivers may be used at the
bidder's discretion during the auction. Alternatively, OEA and MB
consider whether this proposal of three activity rule waivers is
sufficient for small entities or if more are needed and seek comment on
this issue.
56. To assist with the Commission's evaluation of the economic
impact on small entities that may result from the actions and
alternatives that have been discussed in this proceeding, the Auction
114 Comment Public Notice seeks alternative proposals, and requests
information on the potential costs of such alternatives to small
entities. The Commission expects to consider more fully the economic
impact on small entities following its review of comments filed in
response to the Auction 114 Comment Public Notice, including costs and
benefits information. The Commission's evaluation of the comments filed
in this proceeding will shape the final conclusions it reaches, the
final alternatives it considers, and the actions it ultimately takes in
this proceeding to minimize any significant economic impact on small
entities resulting from the final procedures that are ultimately
adopted.
57. Federal Rules that May Duplicate, Overlap, or Conflict with the
Proposed Rules. None.

Federal Communications Commission.
Gary Michaels,
Senior Deputy Chief, Auctions Division, Office of Economics and
Analytics.
[FR Doc. 2026-09838 Filed 5-14-26; 8:45 am]
BILLING CODE 6712-01-P

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