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GOP Spectrum Bill Could Get Drawn Into Debt Fracas

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A draft GOP bill to auction off TV broadcast spectrum could become embroiled in the ongoing feud between President Obama and congressional Republicans, according to a prominent telecom analyst. The bill, which would authorize the FCC to auction off valuable radio frequencies to private bidders, has drawn criticism because it would not allocate the so-called “D block” to public safety agencies, unlike its Senate counterpart.

The bill, authored by Rep. Greg Walden, an Oregon Republican, would authorize the FCC to conduct a voluntary “incentive auction” for the the valuable wireless spectrum, but it would not require the D block to be allocated for public safety uses. The U.S. does not have a nation-wide interoperable public safety network, and for years law enforcement officials have called for the D clock to be allocated for that use. The bill would also exempt the spectrum from the FCC’s net neutrality rules, which are fiercely contested by Republicans.

But with the possibility of billions of dollars on the table from the proceeds of the auction, the GOP plan could quickly become embroiled in the debt showdown.

“It is distinctly possible that spectrum legislation could be included if there is a broad measure to extend the federal debt ceiling and reduce the budget deficit,” Stifel Nicolaus analyst Rebecca Arbogast wrote in a note to clients Thursday. “The debt-ceiling bill is currently engulfed in high-level partisan battles over taxation and spending as it faces an Aug. 2 deadline. If that effort looks to spectrum to provide a piece of the larger deficit puzzle, it could increase pressure to raise auction revenue and lower expenditures for public safety.”

Public Knowledge, a Washington, D.C.-based interest group, lambasted the proposal, saying it would allow broadcasters to “choose which rules they will follow and which rules they won’t if they sell their broadcast spectrum at auction.”

Walden’s bill differs starkly from the Senate version, advanced by Sen. Jay Rockefeller, D-WV. The Democrat’s version also would authorize incentive auctions, but would explicitly allocate the D block for public safety and provide $12 billion for a nationwide wireless broadband network for law enforcement.

Given the stakes of the ongoing high-level budget showdown, and the potential for billions of dollars a spectrum auction could generate, it wouldn’t be surprising to see this fairly esoteric — but extremely important — issue become a political casualty.