Lake and Peninsula Agenda Regular Assembly Meeting
Tuesday, March 17, 2020 @ 9:30 AM King Salmon Alaska
NOTICE AND AGENDA
Notice is hereby given that the Lake and Peninsula Borough Assembly will hold its regular meeting on March 17, 2020 at 8:30 am via teleconference.
NOTE: The time is subject to change. The meeting will not begin before the posted time, but it is possible the meeting may begin after the posted time due to travel, weather and/or scheduling inconsistencies.
This is a public meeting and the public is invited and welcome to participate. This meeting may be accessed by teleconference. The teleconference number is 1-866-339-5580. Enter the pass code *2288317*. Any questions, please contact Borough Clerk, Kate Conley at 907- 246-3421 or 1-800-764-3421 or [email protected].
NOTE: Due to telephone service inconsistency, inherent to rural Alaska, the Borough meeting may not always be available in all locations or audible.
1. CALL TO ORDER
2. ROLL CALL
3. APPROVAL OF AGENDA
4. ADOPTION OF MINUTES
Regular Assembly Meeting - 18 Feb 2020 - Minutes 5 - 9 4.a.
5. MANAGER'S & STAFF REPORTS
5.a. Introduction of Guests
11 5.b. Manager's Report
Page 1 of 188 Manager March 2020 Report
13 - 45 5.c. Consultant's Report Hirsch March2020 Cotten March Report Loeffler - PFEIS response to Borough (sm) Loeffler In-river Hydro
47 5.d. Community Development Coordinator's Report CDC Report 3.9.2020
49 - 50 5.e. Fisheries Report FISHERY ADVISOR REPORT March 2020
51 - 52 5.f. Finance Report Finance Report - March 2020
53 - 88 5.g. Lobbyist Report Legislative Report #20-03 Legislative Report #20-04
89 - 92 5.h. Clerk's Report Clerk March 2020
93 - 94 5.i. Superintendent's Report Superintendent Assembly Report 2020
5.j. SWAMC Update - Myra Olsen
6. NEW BUSINESS
95 - 188 6.a. Broadband Licensing 2020-01-03 Memo re Tribal Priority Window to Apply for Wireless Spectrum License CNET Article on Wireless Spectrum FCC Public Announcement Rural Tribal Window FCC_2.5GHz Tribal Priority Window Report and Order -19-62A1
7. TIME AND PLACE OF NEXT MEETING
7.a. Friday April 17, 2020 in King Salmon
8. CITIZEN'S COMMENTS
Page 2 of 188 9. ASSEMBLY COMMENTS
10. MAYOR'S COMMENTS
11. ADJOURNMENT
12. INFORMATION
Page 3 of 188 Page 4 of 188
MINUTES Regular Assembly Meeting Tuesday, February 18, 2020 via teleconference 8:30 AM
1 CALL TO ORDER Meeting was called to order by Mayor Alsworth at 8:31 am via teleconference.
2 ROLL CALL ASSEMBLY PRESENT: Glen R. Alsworth, Sr., Mayor Myra J. Olsen, Deputy Mayor Randy Alvarez, Assembly Member Scott Anderson, Assembly Member Alvin Pedersen, Assembly Member Michelle Pope-Ravenmoon, Assembly Member Christina Salmon-Bringhurst, Assembly Member STAFF PRESENT: Nathan Hill, Borough Manager Kate Conley, Borough Clerk Mark Stahl, Finance Officer Danica Wilson, Community Development Coordinator GUESTS PRESENT Chuck McCallum, Fishery Advisor Bob Loeffler, Jade North, LLC
3 APPROVAL OF AGENDA Motion was made by Assembly member Alvarez to approve the agenda as presented. Motion was seconded by Assembly member Pedersen. There were no changes proposed. Motion passed unanimously by voice vote.
4 ADOPTION OF MINUTES Motion was made by Assembly member Pedersen to adopt the minutes of November 14, 2019 and January 21, 2020. Motion was seconded by Assembly member Alvarez. The Mayor called for changes or corrections. It was noted that the January 21 minutes, page 4, item 7d, Letter of Support to Denali - "Letter & Obligate" should say does not; and page 3 under finance, item G – should say PILD and PILT. Motion passed unanimously by voice vote
Page 5 of 188 Regular Assembly Meeting February 18, 2020
with scrivener’s errors noted.
5 MANAGER'S & STAFF REPORTS a) Introduction of Guests – no guests were present. b) Manager's Report Mr. Nathan Hill presented a written report. In addition to the written report, he asked the Assembly for permission to continue working on law enforcement in the villages and on the escapement and regulation changes on the Kvichak. The Assembly did not have any objection to Mr. Hill’s suggestions. c) Consultant's Report Cotten - no questions Hirsch - no questions Loeffler – Mr. Bob Loeffler told the Assembly the Army Corps of Engineers has been working on a draft of the final EIS for cooperating agencies. Comments are due in 6 weeks. Mr. Loeffler has been working with Assembly members Ravenmoon and Salmon, and with Nathan Hill to identify cultural resources at the Amakdedori site. Assembly member Salmon said that the Igiugig Village Council had a good meeting with the Corps of Engineers about the Amakdedori site. She asked about an item on page 74 of the executive summary that says the Igiugig hydro will cause a cumulative effect on development. Mr. Loeffler said this could just be a catalog of unrelated projects. Mayor Alsworth said it may be that, because the hydro project is present before the Pebble site development, it be something Pebble is required to consider into the cumulative effect. Mr. Loeffler said he will get a better definition and pass along the information. A final EIS will likely be issued by the Army Corps by the first of summer. In the fall, they will rule on the wetlands permit, which is the only permit of consequence. No State permits have been requested by Pebble. d) Community Development Coordinator's Report Ms. Danica Wilson presented a written report. She highlighted the flooding in Newhalen and said there is not an emergency response procedure in the code. This needs to be discussed and developed in the future. Mayor Alsworth asked to see what other Boroughs have in their code. Assembly member Alvarez said to put it on the future agenda. e) Planning Commission Minutes - none f) Fisheries Report Mr. Chuck McCallum had presented a written report. He noted there is an upcoming Board of Fish meeting on March 8. Three proposals have been submitted from residents. One is about crab limits in Chignik, the other two are about Bristol Bay fishing areas. Mr. McCallum said he will 2 OF 5
Page 6 of 188 Regular Assembly Meeting February 18, 2020
attend the Board meetings. Assembly member Alvarez said he attended the Fish and Game advisory meeting last week where they discussed the Bristol Bay fishing proposals. The proposals are about using two hundred fathom nets and two permits in one boat. The proposal would allow use in Nushagak & Ugashik, but not Aleknagik or Naknek.
g) Finance Report Mr. Mark Stahl presented a written report. He noted revenue is 120% of budget. This will help to offset the bond debt reimbursement the State is not paying this year. PILT, PILD, and raw fish tax bonuses will still come in later this year. The Borough may hit $3 million revenue on raw fish tax this year. Assembly expenses are at 75% of budget. and administration costs will come in under budget. Assembly member Alvarez asked about federal PILT payments. Mark explained it is from the Fed Govt for the park lands. PILT payments were $301,000 last year. Assembly member Ravenmoon said she had a lot of complaints last year about reporting and paying taxes online. Mr. Stahl said the form has been changed, but the finance department is looking at revamping the entire form.
h) Lobbyist Report Assembly member Olsen said she is concerned about bills the Governor has introduced. She asked if the Borough would comment on any of the proposals. The Mayor said the Alaska Municipal League is on top of a lot of this. They provide information on upcoming hearings. Mr. Hill said that our lobbyist, Mark Hickey is keeping him apprised.
i) Clerk's Report Ms. Kate Conley submitted a written report. She emphasized the importance of getting financial disclosure statements to APOC by March 15th. She also asked the Assembly to take a survey about the website.
j) Superintendent's Report Mr. Ty Mase submitted a written report. There was no further discussion.
6 CONSENT AGENDA - none
7 NEW BUSINESS a) Ordinance 20-01 5 year set net lease - Schleizer - public hearing & decision Motion was made by Assembly member Olsen to open the public hearing for Ordinance 20-01, An Ordinance Authorizing a Transfer and Five-Year Lease of Real Property Containing 1.0 Acres, More or Less to Jason Schleizer for the operation of a Commercial Set Net Operation. Motion was seconded by Assembly member Alvarez. The public hearing was open at 9:14 am. The Clerk informed the Assembly the 3 OF 5
Page 7 of 188 Regular Assembly Meeting February 18, 2020
ordinance was properly noticed, and no comments had been received. The Mayor called for comments. There were none. Motion was made by Assembly member Alvarez to close the public hearing for Ordinance 20-01. Motion was seconded by Assembly member Salmon. Motion passed unanimously by voice vote. The public hearing was closed at 9:16 am.
Motion was made by Assembly member Anderson to adopt Ordinance 20-01, An Ordinance Authorizing a Transfer and Five-Year Lease of Real Property Containing 1.0 Acres, More or Less to Jason Schleizer for the operation of a Commercial Set Net Operation. Motion was seconded by Assembly member Salmon. The motion passed unanimously by voice vote. b) Ordinance 20-02 5-year personal use lease - Carroll - public hearing & decision Motion was made by Assembly member Olsen to open the public hearing for Ordinance 20-02, An Ordinance Authorizing a Transfer and Five-Year Lease of Real Property Containing 1.0 acres, more or less to James Carroll and Samuel Carroll for a personal use cabin. Motion was seconded by Assembly member Salmon. The public hearing was open at 9:17 am. The Clerk informed the Assembly the ordinance was properly noticed, and no comments had been received. The Mayor called for comments. There were none. Motion was made by Assembly member Olsen to close the public hearing for Ordinance 20-01. Motion was seconded by Assembly member Anderson. Motion passed unanimously by voice vote. The public hearing was closed at 9:19 am.
Motion was made by Assembly member Alvarez to adopt Ordinance 20- 02. Motion was seconded by Assembly member Salmon. The Mayor called for conflict of interest. None was declared. The Mayor called for comments, there was none. Motion passed unanimously by voice vote. c) Resolution 20-08 Borough CIP Motion was made by Assembly member Salmon to adopt resolution 20- 08, A Resolution Establishing and Adopting a Borough Capital Improvement Program (CIP) List for 2020. Motion was seconded by Assembly member Alvarez. The Mayor called for discussion; there was none. Motion passed unanimously by voice vote. d) Department of Interior - Kijik Village Land Transfer Mayor Alsworth said, from reading the documents, BIA sounds like they oppose the changes. Assembly member Ravenmoon said she was on the Kijik board in the past. There is a cabin built on top of graves. Not sure what protection BIA provides. It is better that the people of Nondalton have ownership. The have been trying to purchase the
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Page 8 of 188 Regular Assembly Meeting February 18, 2020
property for twenty years. Assembly member Ravenmoon said she will help Ms. Wilson draft a letter. Mr. Hill acknowledged that this is a sensitive issue. He recommended it also be put before the Planning Commission as well as seeking input from Assembly member Ravenmoon.
8 UNFINISHED BUSINESS - none
9 TIME AND PLACE OF NEXT MEETING a) Regular Assembly meeting March 17, 2020 Mayor Alsworth recommended meeting in King Salmon. The Assembly agreed by consensus.
10 CITIZEN'S COMMENTS
11 ASSEMBLY COMMENTS Myra Olsen – Assembly member Olsen said she would be glad to help with quality control on election ballots and asked the Clerk to send it over to her. The Mayor said he would review them as well. Michelle Ravenmoon – Assembly member Ravenmoon asked about Pedro Bay School. She said she wants to keep it on the radar.
12 MAYOR'S COMMENTS - none
13 ADJOURNMENT Motion was made by Assembly member Alvarez to adjourn the Assembly meeting. Motion was seconded by Assembly member Ravenmoon. The meeting was adjourned at 9:42 am.
14 INFORMATION - none
CAO
Mayor
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Page 9 of 188 Page 10 of 188 Lake and Peninsula Borough P.O. Box 495 King Salmon, Alaska 99613
Telephone: (907) 246-3421 Fax: (907) 246-6602
March 11, 2020 To: Mayor Alsworth Assembly members From: Nathan Hill Re: Managers Report
Since the last time we met, I have been in touch with some combination of staff, consultants, assembly and Borough residents on a regular basis with a range of topics. I also travelled into Anchorage for the Southwest Alaska Municipal Conference as well as touching bases with numerous other agencies.
While in Anchorage I met with IES regarding Kokhanok wind. We have committed to a schedule that is a little less aggressive with a few steps that are more likely to ensure success. First, we are going to get the wind turbines and turbine controllers installed and have them work to prove a low to medium penetration of electricity over an extended period. After some success is proven we will pull the trigger on purchasing and shipping batteries. We are going to work with IES to order batteries that can be shipped outside of barging season by air.
I also had a day trip to Levelock at the end of February. I met with our Superintendent and Levelock staff. We had a productive community conversation about school safety and education. In talking with residents, I encouraged them to invite us for a visit to Levelock to discuss any community priority or concern with the Assembly.
I continue to maintain contact with the Denali Commission and SWAMC on previously mentioned Iliamna dock and Tazimina hydro improvements. We are hoping to pave a path forward for these projects. We want to at least get the design on Iliamna dock done so we are shovel ready and hopefully attain funding for the Tazimina Obermeyer dam project.
On the Pebble front, Bob has been keeping me posted on the cooperating agency meetings and the on goings with the COE. I also attended the Resource Development Council breakfast where Tom Collier presented an update regarding the Pebble Project and their current plans to move forward. Pebble still has interest in presenting to the Assembly. It looks like the April meeting might be the best time to host them as we will be meeting in person in King Salmon.
COVID-19 has been on the forefront in the last weeks. I have been in touch with staff, the state and media regarding the concern. As it turns out our PCE training in Iliamna was cancelled until further notice in response to the concern. There are other events in region that are being cancelled due to the pandemic. The current Borough meeting is being held by teleconference this month so there was no need to contemplate the issue, but stay tuned for further updates on our tracking of the virus.
Chignik Bay • Chignik Lagoon• Chignik Lake• Egegik • Igiugig• Iliamna • Ivanof Bay• Kokhanok• Levelock • Newhalen • Nondalton• Pedro Bay• Perryville• Pilot Point• Pope Vannoy• Port Alsworth• Port Heiden• Ugashik
Page 11 of 188 Page 12 of 188 Progress Report - Renewable Energy Initiatives Submitted to: Lake and Peninsula Borough Submitted by: Brian Hirsch, Deerstone Consulting, 7 March 2020
Recent Activities
Kokhanok Wind-Battery-Diesel Project:
Received hardware proposal and diesel powerplant maintenance/upgrade proposals from IES. These were not exactly as we had expected, which has resulted in a decision to hold off on immediate purchase of major equipment (specifically, battery, inverter, and system controls), and instead focus on repairing the diesel plant and getting the wind turbines operational with variable speed drives. This will result in yet another delay of the project but we felt it was necessary to prepare the village and the existing power system to be ready for a much more sophisticated operating system and equipment.
This decision has been relayed to both the University of Alaska Fairbanks and the contractor, Intelligent Energy Systems.
Pilot Point Solar and Wind Projects:
Under separate funding provided by SWAMC, I was able to conduct a site visit, along with Connie Fredenberg, of the existing wind system in Pilot Point. The community has been having significant challenges with the project, including potential impact to the diesel power house resulting from the wind turbines operating and the diesel engines running at too low of output and an unknown cause of loss of heat recovery from the power plant to the school. We also investigated the community’s power metering challenges that have the potential for them to lose out on Power Cost Equalization payments from the state. This issue could also affect Kokhanok and any other community that installs large amounts of renewable energy, which is why we are researching the causes and trying to prevent this in the future. There are also several power quality issues the community is having related to large electric loads turning off and on and spiking the system, causing outages. This is expected to get worse with a new fish processing plant unless the issue is addressed with soft starts on motors and other modifications. Some technical and operational suggestions have been made to resolve the issues and the community is considering taking out a loan to purchase and install a battery, which has the potential to solve several of the technical problems if it is handled properly, but cost and project management issues remain.
Denali Commission Outreach:
An application to the Denali Commission for an Obermeyer Dam for the INNEC hydro project was prepared and is under review for submission.
Regional Energy Service Provider Project:
Page 13 of 188 No new activity, other than rescheduling the training for mid-March
British American Energy (BAE):
No new activity other than learning that Levelock has signed a contract with BAE to pursue a battery-based diesel microgrid project.
Funding Opportunity:
The US Department of Agriculture, Rural Utilities Service, has posted a grant opportunity under their High Energy Cost Grant (HECG) Program, which has been successfully pursued previously in the region, including the Kokhanok Wind project. The grant deadline is April 27, 2020, and can provide for up to $3 million per project, with a total budget for the program of $10 million nationwide. For more information, the grant announcement and details can be found at the following website: https://www.grants.gov/web/grants/view-opportunity.html?oppId=324819
Communities are encouraged to please contact the Borough if you are interested in pursuing this grant and we can discuss if this is a good fit and what limited support might be available to pursue this.
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To: Glen Alsworth, Mayor Assembly members
Nathan Hill, Manager
From: Lamar Cotten
Date: March 11, 2020
______
Below is a summary of my work for the month of February.
1. Worked with Nathan on CQE fishing matters.
2. Worked with Nathan with the Denali Commission on future CIP projects and efforts
3. Communicated with ANTHC staff about programs for LPB villages.
Page 15 of 188 Page 16 of 188
MEMORANDUM March 12, 2020 Phone: 250-4621 E-mail: [email protected] To: Lake and Peninsula Borough Nathan Hill, Manager
From: Bob Loeffler
Subject: Response to Borough Comments on the draft EIS
The U.S. Army Corps of Engineers distributed a preliminary version of the final EIS (PFEIS) for the Cooperating Agencies to review. This memo describes how the PFEIS responded to the Borough’s comments on the draft.
Ferry Impacts to Juvenile Salmon in Lake Iliamna. The PFEIS significantly expanded its description of the fish and other values in Lake Iliamna. It used the information on salmon distribution and salmon behavior in that section to increase the specificity of their discussion of potential ferry impact on salmon.
While the PFEIS includes more research, it comes to the same conclusion as the draft EIS about the effect of the ferry on juvenile salmon. Specifically, it concludes that juvenile salmon would not concentrate in the path of the ferry, but would avoid the ferry due to the salmon’s preference to avoid daylight, avoid cold water, and having the size and ability to avoid the noise and vibration from the ferry. More information is provided in Attachment 1.
Cultural Resources at the Amakdedori Port. While our letter described concern about the potential for additional cultural resources at the Amakdedori Port site, particularly grave sites, the Borough is pursuing our concerns about this outside the formal EIS process but gathering information and potentially identifying on-the-ground resources itself.
Other Specific Changes. The borough made other requests for changes in wording. The PFEIS reflects most but not all of the Borough’s requests. In discussion with AECOM, it appears that the omissions were more inadvertent than intentional. Nathan and I can work with the Corps to have the Corps fix the errors before issuing the final EIS. (See Attachment 2).
Attachments. 1. Borough questions on the draft EIS about ferry impacts, and PFEIS response. 2. Other Borough comments on the draft EIS and PFEIS response. 3. PFEIS pages 3.24-76 through 3.24-85: expanded information about Iliamna Lake fish resources. 4. PFEIS pages 4.24-26 through 4.24-38: the environmental impact of the ferry.
PFEIS response to Borough Comments Page 1
Page 17 of 188
Attachment 1. Borough Questions and PFEIS Responses about Ferry Impacts
The Borough’s comments letter on the draft EIS had specific request for more information about potential ferry impacts on juvenile salmon. Specifically, we asked the following questions:
Borough Questions about Distribution of salmon. Our letter asks: “What is the distribution of juvenile salmon in the water column in the winter? Specifically, do juvenile salmon concentrate near the surface of the lake?” Our letter also asks: “Does an open lead during the iced-over season increase the concentration of the salmon near the surface because of greater oxygen, more light, or other reasons?”
PFEIS Information. Below is a summary of the new information. The relevant portions of the PFEIS which have more information are included as Attachments 3 and 4. o General distribution: “sockeye fry were the dominant fish species in the eastern portion of Iliamna Lake, with reduced abundance in the western basin. In contrast, yearling sockeye (fish over 80 millimeters fork length) were more prevalent in the central and western basins...” [page 3.24-80]. o Diurnal distribution. The PFEIS has a discussion about diurnal distribution. It indicates that in general, juvenile salmon stay relatively deep (>20 meters), and migrate to shallow water during the night, though the PFEIS acknowledges mixed information with respect to this behavior under ice [page 3.24-80]. o Light-avoiding behavior. “Although not directly applicable to Iliamna Lake, numerous studies have consistently demonstrated that stream-dwelling juvenile salmonids in periods of low water temperatures exhibit a strong negative phototaxis response, where they hide in dense, light-blocking cover during the day and emerge into the open water column at night” [page 3-24-81]. o Cold-avoiding behavior. The PFEIS indicates that studies of Coho salmon indicate that they are avoid colder water and are likely to remain in areas with lower dissolved oxygen but warmer water (near the bottom of Chignik Lake) [page 3-24-81].
Borough questions about juveniles avoiding the noise and vibrations of a ferry. Our letter asks: Do juvenile salmon avoid the noise and vibration of a boat, such as the ferry? That is, will the size and noise of the ferry scare the juveniles away and thereby minimize the propeller- induced effects?
PFEIS Information. The PFEIS cites fisheries research, though none on salmon, about fish avoiding noise-generating activity. The PFEIS indicates that “Based on the reports in the literature and the predicted sound levels from these vessels, there may be some avoidance by fish in the immediate area.” [page 4.24-31]. Further, The PFEIS concludes that fry less than 10 millimeters in length are most susceptible to damage by entrainment by the propellers. It also concludes that “Sockeye fry hatch-out much larger than 10 millimeters in length (Beacham and Murray 1991), and typically remain nearshore until early summer (Hoag 1972)....In contrast, yearling sockeye exhibit pelagic, open-water behavior; however, they are larger (i.e., bigger than 70 millimeters) (Rich 2006) and stronger swimmers, and would be expected to detect and avoid propeller-related impacts.” [Page 4.24-30].
PFEIS response to Borough Comments Page 2 Attachment 1. Ferry Impacts
Page 18 of 188
Borough questions about Potential Mitigation. Our letter asks: “Is there increased predation of juvenile salmon in the propwash of a boat from birds or other species? If so, is there mitigation measures that can be implemented to minimize this problem. (An example might be a water spray out the back of the boat to decrease bird concentration to provide some time for stunned juvenile salmon to re-orient themselves and swim away from the surface).”
PFEIS Information. The PFEIS lists our proposed monitoring and mitigation in their list of possible mitigation measures: “Monitor the ferry crossing for evidence of smolt/fish impacts. If birds are observed feeding on disoriented fish, require the ferry to use deterrents such as water spray or streamers to reduce bird predation.” However, they also erroneously provided that there is no clear agency jurisdiction for that measure. They are wrong, and we can suggest that a stipulation can be included as part of the State of. Alaska’s Plan of Operation Approval or possibly as part of the Borough’s permit. [Appendix M, Page M-36].
PFEIS Conclusion. The PFEIS comes to a similar conclusion as the draft EIS about the ferry’s impact on juvenile salmon. • Propeller strikes or entrainment: based on the information above, the PFEI determined that impacts are possible, but that they would be localized to individual fish i.e., impacts would not be frequent enough to have a significant effect on the overall population.
• Wake impacts on shore: modelling indicates that at a 6-knot speed approaching shore perpendicularly (therefore affecting limited shoreline) would generate a 4-inch wake which would dissipate within 30 feet of the hull. “Consequently, any impacts on juvenile and adult fish due to boat wake would be limited both spatially and temporally.”
• Noise and vibration: Based on the above information, the PFEIS concludes that the noise and vibration would cause fish to avoid the immediate area of the ferry, but the “disturbance to fish species would be short-term, and fish would return to their pre- disturbance behavior once the activity ceases.”
PFEIS response to Borough Comments Page 3 Attachment 1. Ferry Impacts
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Attachment 2. Other Changes
This attachment describes each change the Borough requested in the Draft EIS and the changes made in the PFEIS (not including impacts about ferry impacts).
Borough comment: Section 4.2. Land Ownership, Management, and Use. From the Borough comments on the draft EIS: Page 4.2-3 includes the sentence “Any permits from a borough would only be used with permit stipulations that would address potential land use conflicts.” That is not the case. The Borough has a large project permit which addresses socioeconomic and fiscal impacts on residents and villages. Please change to reflect that. Similarly, the sentence in Table 4.2-1 should be changed “Permits and authorizations may will be required by the LPB.”
Change made in PFEIS. With respect to borough permits only addressing potential land-use conflict, the PFEIS added “...as well as socioeconomic and fiscal impacts to residents and villages” [Page 4.2-7]. With respect to changing may to will in the offending sentence, the PFEIS changed the sentence to read, “LPB also issues permits and authorizations” [Page 4.2-2]. These changes appear to accommodate our requests.
Borough Comment: Socioeconomic Section 4.3 Population. Borough suggested additional information about potential population change which was part of the InterGroup repor.
Change mostly made in PFEIS. The PFEIS expands the section on population change and includes much of the information we suggested. [Page 4.3-9]
Borough Comment: Socioeconomic Section 4.3 Transportation. The Draft EIS had the sentence, “Although the mine and port access roads and port are described as private, PLP has stated that they would work with all local communities to identify the best solutions for controlled use of the access roads and ferry for community transportation needs, which would help reduce the local cost of living.” Borough letter indicated that it expects to work with landowners, the state, and project applicant to develop a road management agreement which provides rules for how the road will accommodate use by Borough residents and businesses.
Change not made in PFEIS. The PFEIS made no changes that I can find to respond to our comment. The Corps may have missed the implications of our comment. I explain to AECOM that the existing languages makes it seem that decisions around road use are within the discretion of PLP. They are not. Road use agreements will be developed in cooperation with the Borough in order to get the large project permit from the Borough. I expect that it will be fixed before the final EIS [Page 4.3-7]
Borough Comment: Socioeconomic Section 4.3 Transportation. Borough comment indicated that it may require that the applicant mark open-water and cross-lake ice roads during the winter for safety of Borough travelers.
Change made in PFEIS. PFEIS adds the following: “PLP would work with communities (and supply funding) to provide for the marking and maintenance of snowmachine trails between communities across Iliamna Lake and around the ferry route
PFEIS response to Borough Comments Page 4 Attachment 2. Other (non-ferry) Comments
Page 20 of 188
when lake ice is sufficient enough to support such traffic (PLP 2018-RFI 071a).” [Page 4.12-10]
Borough Comment: Socioeconomic Section 4.3 Employment. Borough commented that it “would expect the company to designate all communities within the Borough as pick-up points where employees are transported free of charge to the Project. In addition, the Borough would expect the company designate areas outside the Borough such as Kenai or Anchorage, as pick-up points so that employees do not have an incentive to move to the Borough to avoid transportation costs.”
Change partially made in PFEIS. Borough’s suggestion was included exactly as we submitted it as a potential mitigation measure. However, they also added the internally contradictory statement: “Designating all communities in the LPB would not be practicable; however, it is likely that PLP would transport workers to the mine site at no cost to the employee.” Since transporting workers to the mine at no cost is designating the communities as a pick-up point, their comment does not make sense. After explanation, I expect they will fix it before the final EIS. [Appendix M, Page M-36]
Borough Comment. Socioeconomics 4.3 Education. Our comment letter stated, “K-12 education is a Borough responsibility, the Lake and Peninsula Borough School District, not a responsibility of a mining company. Nevertheless, the Borough would expect to coordinate in some fashion with the company so that Borough vocational and other educational initiatives would help Borough students increase employability at the mine or elsewhere.” The letter went on to state, “Similar to above the Borough would expect to coordinate with the mining company so that post-K-12 vocation education is available to Borough residents to increase their increase employability at the mine or elsewhere.”
Change made in PFEIS, but wrong. It appears that the PFEIS tried to accommodate our request, but it did so badly. The PFEIS added the sentence, “Training and education programs provided by PLP at schools would require the agreement of the school district.” This does not capture our intent. I’ll work with the Corps to revise the sentence. [Page 4.3-7]
Borough Comment. Socioeconomics 4.3 Education. Borough commented that the “Fiscal impact portion of the Borough’s Large Project Ordinance would ensure that any expansion of school facilities due to the project would be paid for by the project through increased tax revenues.”
Change made in PFEIS. The PFEIS added our suggested language. [Page 4.3-7]
Action Item. The Borough should send a letter to the Corps asking them to fix the four omitted or partial responses to the Borough’s previous comments. I will work with Nathan on the letter.
PFEIS response to Borough Comments Page 5 Attachment 2. Other (non-ferry) Comments
Page 21 of 188 PEBBLE PROJECT CHAPTER 3: AFFECTED ENVIRONMENT PRELIMINARY FINAL ENVIRONMENTAL IMPACT STATEMENT
3.24.4.3 Natural Gas Pipeline Corridor Along the Alternative 2 pipeline route, the road and adjacent pipeline would cross numerous stream channels, some of which are listed in the AWC as anadromous waters (Table 3.24-14), and others are inhabited by resident fish species. As noted previously, the Newhalen River provides a migratory connection between Iliamna Lake and Lake Clark for large numbers of adult and juvenile sockeye salmon. Beyond the Newhalen River, the road and pipeline skirt the western and southern flanks of Roadhouse Mountain, where the road turns south to Eagle Bay, and the pipeline continues east towards Williamsport. Under the Applicant’s Preferred Alternative, the natural gas pipeline route remains the same, with the exception of a new Iliamna Lake crossing route and an overland route to connect with the mine access road where it crosses the existing Newhalen River Road. After crossing Iliamna Lake, the pipeline route is the same for the Applicant’s Preferred Alternative and Alternative 1 (see Figure 3.24-15 and Figure 3.24-16). The pipeline for these alternatives is co-located with the port access road for Alternative 1. Under Alternative 3, the stand-alone overland portions of the natural gas pipeline corridor are north of Iliamna Lake between Eagle Bay and Pile Bay ferry terminals (see Chapter 2, Alternatives). The gas pipeline would cross waters supporting anadromous and resident fish habitat, and numerous small channels designated as fishless (Table 3.24-14). In addition to the anadromous channels crossed by the natural gas pipeline, the transportation corridor passes within 0.25 mile upslope of several other anadromous waters, including a tributary to Pedro Bay (AWC 324-10-10150-2317-3035), Russian Creek (AWC 324-10-10150-2323), and a tributary to Lonesome Bay (AWC 324-10-10150-2335), each is designated as sockeye spawning habitat. The natural gas pipeline under this alternative would be buried adjacent to the road alignment to Diamond Point, then would cross Cook Inlet to the Kenai Peninsula, as previously described. The affected environment associated with the natural gas pipeline described under Alternative 2 is applicable to the transportation and pipeline route in Alternative 3. The number of road and pipeline crossings for Alternative 3 is very similar to Alternative 2 (Table 3.24-14), with one fewer crossing of an anadromous channel. Alternative 2 crosses Eagle Bay Creek at two locations (one for the road, one for the natural gas pipeline); the Alternative 3 road and adjacent natural gas pipeline cross it in a single location.
3.24.4.4 Iliamna Lake The Iliamna Lake bottom would be crossed by a natural gas pipeline, and the surface crossed by an ice-breaking ferry under the Applicant’s Preferred Alternative, Alternative 1, and Alternative 2. The lake entry and exit points and crossing alignments would differ for each alternative as shown in Figure 3.24-19. The following subsections describe general attributes of the lake, including aquatic habitat, anadromous and resident fish, lake productivity and MDNs, aquatic invertebrates, and trace metal analyses.
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Page 22 of 188 Nondalton ! MINE SITE Koktuli River Russia
Alaska EAGLE BAY Canada Mine Access Road FERRY TERMINAL ! North Fork Koktuli R. Iliamna Spur Road MINE SITE North Access Road
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Sources: PLP 2019-RFI153; Morstad 2003; Action Alternatives Alternative 1 Kokhanok East ADF&G; ADNR (! Zooplankton Sample Sites Sockeye Salmon Adult Counts !!!! Ferry Routes Ferry Terminal Variant Median Count Natural Gas Pipelines Alternative 2 (! < 2,000 Applicant's Preferred Alternative 2 Newhalen River North Crossing Variant (! 2,000 - 5,000 Alternative Alternative 1 Alternative 3 (! 5,000 - 10,000 FERRY ROUTES, SOCKEYE SALMON BEACH F 10,000 - 20,000 SPAWNING AREAS, AND ZOOPLANKTON
Page 23 of 188 (! 5 0 5 10 Anadromous Stream SAMPLING SITES IN ILIAMNA LAKE
Miles PEBBLE PROJECT EIS FIGURE 3.24-19 I:\Pebble_EIS_GIS\FEIS\Mxd\Chp3\3_24_Fish\Figure_03_24_19_Iliamna_Lake_Alternatives.mxd; thomas.schultz; 1/30/2020 1:25:15 PM PEBBLE PROJECT CHAPTER 3: AFFECTED ENVIRONMENT PRELIMINARY FINAL ENVIRONMENTAL IMPACT STATEMENT
Aquatic Habitat Iliamna Lake is a large lake with a surface area of 1,012 square miles. Iliamna Lake and its numerous tributaries provide spawning and rearing habitat for all five species of Pacific salmon and resident salmonid species, including Dolly Varden and rainbow trout. Major tributaries associated with the analysis area include the Newhalen River, UTC, and the Gibraltar River. The western half of Iliamna Lake is wide, with linear margins and few islands; whereas the eastern half (particularly the far northeastern end) has a contorted shoreline with an abundance of bays, islands, and rocky shoals. The majority of tributaries, including those supporting anadromous species, enter Iliamna Lake on the northern shoreline and surrounding the eastern basin, including Kokhanok Bay; tributaries are less common on the western shoreline. The difference in physical characteristics of eastern, central, and western basins is also reflected in other notable parameters. Summer water temperatures in the eastern portion of Iliamna Lake can be slightly cooler than the western basin, which is shallower and warmer and supports higher densities of zooplankton than the eastern basin (Rich 2006). Although cooler in the summer, ice breakup in the spring tends to occur at an earlier date in the eastern basin. Additional physical characteristics of Iliamna Lake are described in Section 3.16, Surface Water Hydrology. Of the anadromous salmonids, sockeye is the most common species in Iliamna Lake, where they are known to use shoreline habitat for spawning (EPA 2014), particularly in the northeastern portion of the lake (Figure 3.24-19). Juveniles also immigrate into the lake from spawning tributaries to use lacustrine rearing habitats. Iliamna Lake is also heavily used by adfluvial rainbow trout, which use a variety of lake habitats for summer foraging (PLP 2018b; Minard et al. 1992).
Anadromous and Resident Fish Distribution Over 20 fish species have been reported from Iliamna Lake and the Kvichak system (Metsker 1967; Hauser et al. 2008; Johnson and Blossom 2018), including all five anadromous Pacific salmon (Chinook salmon, coho salmon, chum salmon, pink salmon, and sockeye salmon), Arctic char, and lamprey species. Eight non-anadromous salmonids (adfluvial populations of rainbow trout, Dolly Varden, lake trout, Arctic grayling, humpback whitefish, round whitefish, pygmy whitefish (P. coulterii), and least cisco) occur in Iliamna Lake, along with numerous non-salmonid species, including northern pike, slimy sculpin, threespine and ninespine stickleback, burbot, Alaska blackfish (Dallia pectoralis), longnose sucker, and pond smelt (Hypomesus olidus). The most common subsistence fishery is for sockeye salmon; but targeted fisheries also include Arctic grayling and whitefish (Holen and Lemons 2012). See Section 3.9, Subsistence, for more information on subsistence use. Many of these fish species, whether as juveniles or adults, rely on Iliamna Lake’s plankton resources for food and growth. Bristol Bay is renowned for producing the world’s largest runs of sockeye salmon, up to 50 percent of which may return to the Kvichak Basin (Dann et al. 2009). Escapement of adult sockeye salmon to the Kvichak Basin from 2012 to 2018 ranged from 2.1 million to 7.3 million fish (ADF&G escapement data). Most of these fish migrate into Iliamna Lake from July through September on the way to spawning grounds in numerous Iliamna Lake tributaries (including UTC), to beach spawning areas along Iliamna Lake shorelines and islands, or to tributaries of Lake Clark upstream of Iliamna Lake. A radio telemetry study of upstream migrating sockeye salmon in Lake Clark indicated that most sockeye swam directly to spawning locations (Young 2004), and noted that >90 percent migrated during the day (Poe and Rogers 1984, cited by Young 2004). In Iliamna Lake, Blair and Quinn (1991) noted that sockeye salmon tended to migrate along the shoreline and were more likely to move into tributary habitats than beach habitat, a finding similar to that of Young (2004).
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Iliamna Lake is particularly noted for supporting still-water spawning by large numbers of sockeye salmon. With some exceptions, annual ground, boat, and aerial surveys of spawning salmon areas have been conducted in the basin by ADF&G and the University of Washington since 1920 (Morstad 2003). Widespread aerial surveys have detected shoreline spawning in many areas of Iliamna Lake, with heaviest spawning along island and bay shoreline habitats in the eastern lake basin (Figure 3.24-19). Aerial counts have shown wide annual and spatial variability, with index estimates for Woody Island (for example) ranging from 500 spawners in 1963 to over 194,000 fish in 1970. Index counts along Knutson Bay’s shoreline have ranged from 1,000 fish in 1990 to 1,000,000 in 1960. Although survey sites varied somewhat from year-to-year, overall index counts of adult spawners along Iliamna Lake’s shoreline or island beaches from 1965 to 2002 have typically represented between one percent and 7 percent of sockeye counted in Kvichak Basin index sites (Morstad 2003). Of the 93 documented spawning locations in Iliamna Lake, 46 are found east of Eagle Bay (Rich 2006). The majority of Iliamna Lake’s freshwater seal population also resides in the eastern basin, where adult sockeye are the principal prey item during the summer months (Hauser et al. 2008). The majority of beach spawning occurs in the eastern end of the lake (Figure 3.24-19), where spawner densities are highest on exposed points of land at narrows between islands and on reefs (Kerns and Donaldson 1968). Upwelling was not noted at these locations, but eggs were exposed to wind-driven lake currents and seiches, which have been shown to influence subgravel flow in known spawning locations (Leonetti 1997). Kerns and Donaldson (1968) identified four types of spawning bottom: 1) coarse gravel mixture of rocks with little or no sand; 2) irregular small broken rock; 3) large broken rock and irregular rocks; and 4) round boulders; irregular rocks with compact fine material in between. Ninety percent of observed spawning locations were at depths from 6 to 20 feet, with slopes of 15 to 25 degrees. Studies have demonstrated site fidelity of returning adult spawners in Iliamna Lake, whether to specific tributaries or to beach habitats (Quinn et al. 1999; Quinn et al. 2009). Differences in body morphology and life-history characteristics have been detected between sockeye spawning in tributaries to Iliamna Lake versus fish spawning in the lake’s beaches (Blair and Quinn 1991; Habicht et al. 2007). A variety of life history types and multiple distinct, locally adapted populations has been reported by Dann et al. (2013). They noted hierarchical distribution between ecotypes, among drainages in ecotypes, and among populations in drainages. Genetic studies have also shown differentiation between sockeye entering the Kvichak Basin and those spawning in the Nushagak Basin, with at least eight distinct populations identified in the Nushagak and 14 in the Kvichak (Dann et al. 2013). Habicht et al. (2007), using the microsatellite data, examined the population genetic diversity and structure of sockeye salmon spawning in tributaries of Bristol Bay. They found: 1) significant variation over all lakes and in all drainages except Ugashik, Egegik, Wood, and Igushik rivers; 2) genetic structure among sockeye stocks from the large, southeastern Bristol Bay lakes was shallow, whereas structure among stocks upstream of obstacles to migration and among stocks from northwestern Bristol Bay was more typical of the species; 3) similarity among populations rearing in the four largest lake systems on the southeastern side of the bay (upper and lower Ugasik, Becharof, Naknek-Grosvenor-Coville, and Iliamna lakes); and 4) the Iliamna Lake site collections clustered most closely with site collections from Naknek River (excluding Brooks Lake). Eight genetically discrete reporting groups were identified. Juvenile sockeye in Iliamna Lake originate from shoreline or island spawning, from tributaries to Iliamna Lake, and from Lake Clark. After spawning, a protracted period of embryonic development follows, and fry emerge from the gravel in streams and lake beaches around the time when ice breaks up in May and June. Juveniles rear in a lake for 1 or 2 years prior to seaward migration, but a number of populations over the range of the species migrate to sea in their first year. In Bristol Bay, those migrating to sea in their first year are uncommon and are almost exclusively in
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Page 25 of 188 PEBBLE PROJECT CHAPTER 3: AFFECTED ENVIRONMENT PRELIMINARY FINAL ENVIRONMENTAL IMPACT STATEMENT the Nushagak River itself (Quinn et al. 2009). While in the near shore areas, sockeye fry feed primarily on zooplankton and aquatic insects, shifting to zooplankton as they move to offshore areas later in the summer. The date of emigration of juveniles may depend on the prevailing environmental conditions. In general, warming temperatures in spring may initiate early emigration. Monitoring studies of juvenile sockeye salmon have been undertaken to assess abundance, distribution, growth, and vertical migration (Schuerell and Schindler 2003; Nemeth et al. 2014; and University of Washington). In Iliamna Lake proper, the University of Washington has been sampling juvenile sockeye salmon in June through July since the 1960s using tow nets and beach seines. Both the number and size of juveniles captured varied between years. Rich (2006) found that sockeye fry were the dominant fish species in the eastern portion of Iliamna Lake, with reduced abundance in the western basin. In contrast, yearling sockeye (fish over 80 millimeters fork length) were more prevalent in the central and western basins, where zooplankton densities also tend to be higher (Rich 2006). Rich (2006) also assessed historical growth data and found that mean size of juveniles averaged almost 10 millimeters longer in the western lake basin (86.2 millimeters) than in the eastern basin (76.8 millimeters). A similar east-to-west trend was observed for fry where fish in the western and central regions averaged 53.4 to 55.2 millimeters, while fry in the eastern basin averaged 51.0 millimeters. Both temperature and fish density were factors affecting fish length, with spring air temperatures exerting the most influence on fry length at the conclusion of the growing season. Juvenile sockeye are known to exhibit diel vertical migration in oligotrophic lakes. This migration involves juvenile sockeye moving up in the water column during night and moving down the water column during daylight hours. Schuerell and Schindler (2003) studied three lakes on the Wood River system and found a strong positive relationship between the amount of incident light at the lake surface and the depth of the juvenile salmon during the crepuscular periods and night. As the light level increased, the mean depth of the juvenile sockeye salmon also increased. In their study, juvenile sockeye began their upward migration around 2200 hours from their daytime depth near 75 meters They then reached their average nighttime depth of 15 meters around 0230 hours, where they remained for 1 hour before migrating back down again. Relatively few juveniles were observed at depths less than 10 meters during summer or fall sampling. Their results tended to support Clark and Levy’s (1988) antipredation window hypothesis, whereby juveniles balance feeding opportunities with predation risk by using shallower water during periods of reduced light intensity, such as early morning hours in midsummer at northern latitudes, or at dawn and dusk in spring or fall, or at lower latitudes. Less research is available on the vertical or horizontal distributions of juvenile salmonids in large lakes under winter conditions, particularly in comparison to ice-covered or open-water areas. Long-winter conditions can result in depletion of energy stores among juvenile salmon, due in part to a reduction in zooplankton abundance. Juvenile kokanee in three Idaho lakes continued to feed over the winter months despite complete ice coverage, which blocked 99 percent of light penetration (Steinhart and Wurtsbaugh 2003). Positive growth did occur in one year of study when zooplankton abundance was high going into the winter, but salmon did not grow over the previous winter when plankton densities were lower. Ruggerone (1992), however, found very little feeding during winter, ice-covered conditions in two Alaskan lakes. Evidence of diel vertical migrations during winter months also showed variable results. In one of the three Idaho lakes (Stanley Lake) studied by Steinhart and Wurtsbaugh (1999), juvenile kokanee used deep water (>20 meters) during the day, and migrated into shallower water (<8 meters) at night, similar to that seen in summer in the Wood River study (Schuerell and Schindler 2003); however, juveniles in nearby Redfish Lake remained at relatively shallow depths (2 to 5 meters) throughout the day and night. Juvenile kokanee in Alturas Lake did show vertical
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Page 26 of 188 PEBBLE PROJECT CHAPTER 3: AFFECTED ENVIRONMENT PRELIMINARY FINAL ENVIRONMENTAL IMPACT STATEMENT migration, but only within a relatively narrow range of depths (<14 meters). The authors suspected that differences in density and composition of predator species between the three lakes may have been a factor, with a higher predator index in Stanley Lake, which also showed the most prominent vertical migrations. The Alaskan study by Ruggerone (1992) revealed a strong relationship between under-ice depth choice by juvenile salmon and water quality parameters. Black Lake and Chignik Lake are small lakes in comparison to Iliamna Lake, but both support populations of sockeye and coho salmon. Black Lake is very shallow (average under ice depth 1.1 meters), whereas Chignik Lake has depths exceeding 45 meters. In Chignik Lake, sockeye were more abundant in the lake outlet followed by offshore and inshore sampling areas. Near the outlet of Chignik Lake, traps set near the surface caught significantly more sockeye than bottom traps; however, sockeye in the offshore sampling area were six times more abundant at 20 meters than at 10 meters, and three times more abundant than at the surface. No juvenile sockeye were captured in baited traps in Black Lake; however, catches of juvenile coho showed a response to water quality trade-offs. Catches of juvenile coho were significantly higher in traps set near the lake bottom compared to traps set near the surface. Water quality data showed that coho preferred warmer (2°C) bottom habitat, despite low levels of dissolved oxygen (3 mg/L), rather than surface waters that had high dissolved oxygen (8 mg/L) but were colder (0.6°C). Although not directly applicable to Iliamna Lake, numerous studies have consistently demonstrated that stream-dwelling juvenile salmonids in periods of low water temperatures exhibit a strong negative phototaxis response, where they hide in dense, light-blocking cover during the day and emerge into the open water column at night (Griffith and Smith 1993; Contor and Griffith 1995). In the Kvichak River, sockeye smolts were sampled during their seaward migration in mid-May through mid-June in 2008 to 2013 at two sites after ice had stopped flowing from Iliamna Lake, mostly in May (Nemeth et al. 2014). Variability in abundance estimates was observed both between sites and years. At one site, abundance estimates of smolts ranged from 30.8 million to 57.3 million, and at the other site estimates ranged from 26.9 million to 47.0 million. This monitoring established the run timing between May 22 and June 9 (midpoint of May 27). Most smolts migrated down the left side of the channel over relatively deep water, although smolts were also detected across the entire river. Most smolts in the Kvichak River migrated within the upper 1.0 meter of the water column, and approximately half the run migrated during the daylight hours. Limited information is available describing the distribution, abundance, or general ecology of resident fish species in Iliamna Lake; however, stickleback are frequently the most abundant fish species observed in trawl surveys, particularly in shallow, nearshore environments in the eastern lake basin (Rich 2006). Stickleback and juvenile salmon are likely the predominant prey species for larger piscivorous fish species, such as northern pike, rainbow trout, lake trout, Arctic char, Dolly Varden, and burbot. Sticklebacks, juvenile salmon, whitefish, sculpin, and lamprey are known or suspected prey species for the lake-resident seal population, particularly during periods when adult sockeye are absent (Hauser et al. 2008). Sculpin are a common inhabitant of the benthic zone and are known to be significant predators of sockeye salmon eggs and newly emerged fry (Kline et al. 1993). Sculpin in Iliamna Lake, as well as stickleback, rainbow trout, and char (species not identified), have all shown enhanced levels of marine-derived nitrogen, and benefit from the abundance of post-spawn sockeye carcasses in Iliamna Lake (Mathisen et al. 1988). Of the non-anadromous species present in Iliamna Lake, rainbow trout provide an important sport fishery in the lake and associated tributaries, including UTC, the Newhalen River, and the Gibraltar River. The adfluvial form of rainbow trout are widely distributed in the Iliamna Lake basin.
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Seventy fish of 97 radio-tagged adult trout were tracked throughout the western half of Iliamna Lake and many of the lake’s western tributaries through spring of 2009 (PLP 2018b). UTC-tagged trout migrated from 10 tributaries to western Iliamna Lake, with most detections in UTC, lower Talarik Creek, Pete Andrews Creek, the Newhalen River, and the Kvichak River. Migration patterns included spring immigration into tributaries (presumably for spawning), and summer foraging throughout the western half of Iliamna Lake or in several tributaries, followed by fall immigration and overwintering in the lower mainstem reaches or outlet lagoon habitats of the five tributaries listed previously (Minard et al. 1992). Relatively few tag detections in Iliamna Lake occurred east of the line between Gibraltar Creek and the Newhalen River; however, a large proportion of detections occurred in offshore areas of western Iliamna Lake, suggesting a pelagic migratory pattern.
Lake Productivity and Marine-Derived Nutrients Input of MDN from carcasses of spawned-out salmon (particularly sockeye) is an important factor in the productivity of Iliamna Lake and its primary spawning tributaries (Mathisen et al. 1988; EPA 2014). Nutrients support productivity of phytoplankton, which in turn supports zooplankton, the primary diet of juvenile sockeye in Iliamna Lake. A simulation of the effects of MDN on the productivity of an Idaho lake concluded that adult sockeye carcasses would have been responsible for 3 percent of the annual phosphorus load, and positive effects would be transitory (Gross et al. 1998). This result was due in part to the relatively high flushing rate of Redfish Lake, as well as low smolt-to-adult survival and conservative estimates of pre-dam escapement of sockeye salmon. Given a more liberal escapement estimate that would be comparable to a comparable Alaskan lake (Karluk Lake), MDN could contribute up to 17 percent of total phosphorus and 11 percent of total nitrogen. Comparison of MDN effects in Iliamna Lake with several nearby lakes without anadromous fish demonstrated that sampled fish in Iliamna Lake contained higher levels of a marine-origin nitrogen isotope than did fish in the control lakes (Klein et al. 1993).
Aquatic Invertebrates Zooplankton are a primary source of food for plankton-eating juvenile fishes, including sockeye salmon (Quinn 2018). Hoag (1972) found that sockeye fry most often fed on Bosmina (a genus of copepod), whereas yearling prey mostly consisted the cladoceran Cyclops. Given the importance of zooplankton to the growth and survival of juvenile salmon rearing in Iliamna Lake, the primary and secondary productivity of Iliamna Lake has been intensively studied, including recent data collected for this project (R2 et al. 2011a). Project baseline studies were conducted in the northeastern portion of Iliamna Lake, which extended from the mouth of UTC to just beyond Whistlewing Bay (Figure 3.24-19). Monthly samples taken in Iliamna Lake in May through October 2005 and 2007 at five sites in proximity to the Alternative 2 and Alternative 3 transportation corridor showed six groups of zooplankton: Copepoda (copepod crustaceans), Cladocera (water fleas), Ostracoda (seed shrimp), Rotifera (rotifers or wheel animals), Laevicaudata (clam shrimp), and Anostraca (fairy shrimp). These groups are similar to those documented in previous studies of Iliamna Lake and other lakes in the region (Hoag 1972; Biesinger 1984; Lenarz 1966 [in R2 et al. 2011a]). Seasonal variations in relative abundance of these groups were observed in both years and between sites. Although variations occurred, copepods were most common. Ostracoda, Anostraca, and Laevicaudata were seldom found and comprised less than 1 percent of the overall population of zooplankton. Rich (2006) found that zooplankton densities increased from spring to summer, and noted a declining trend from the western basin to the eastern basin. As part of the Iliamna Lake Study (HDR 2011a, Appendix B), freshwater mussels were collected at Bucket Lake, Finn Bay, Flat Island, and Whistlewing Bay on Iliamna Lake from 2005-2007
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(HDR Alaska 2011a, Appendix B). Samples were analyzed for contaminants, and no distribution or abundance data were collected. The closest site to project infrastructure was at Bucket Lake, approximately 2.5 miles east of the Applicant’s Preferred Alternative natural gas pipeline corridor (Figure 3.24-15). No other mussels were documented in the analysis area.
3.24.4.5 Ferry Terminal Locations and Ferry Crossing Routes As shown in Figure 3.24-19, five potential ferry terminal locations have been identified on the shores of Iliamna Lake. The figure also depicts the potential ferry and pipeline crossing routes associated with each of the alternatives. In general, the ferry terminal locations and crossing routes are not heavily used by spawning sockeye salmon (Figure 3.24-19). Aerial and snorkel surveys were conducted in July and August near potential ferry terminal sites (Paradox Natural Resources 2018c, d). Aerial surveys indicated that adult sockeye salmon were consistently found at or near the ferry terminal locations, and were often swimming in an easterly direction along shore toward spawning locations in an eastern portion of Iliamna Lake or its tributaries. However, with the exception of test redd excavations (incomplete redds without egg deposition) at Eagle Bay North in August, no other signs of spawning or pre-spawning behavior were observed during the aerial or snorkel surveys. There was evidence of concurrent spawning activity at Knutson Bay east of Eagle Bay. As shown on the figure, the largest sockeye salmon spawning aggregations are in the eastern areas of Iliamna Lake. None of the ferry terminal sites appear to be consistently used for spawning by sockeye salmon. The following subsections provide additional information on the affected environment related to fish values at each of the ferry terminal locations.
Eagle Bay Eagle Bay would be the site of a ferry terminal under the Applicant’s Preferred Alternative and Alternative 2 (see Figure 3.24-19). Index sites were sampled intermittently in Eagle Bay, where counts of adult salmon ranged from 15 fish to about 5,000 fish. Counts were highly variable among the Eagle Bay Islands, just offshore from Eagle Bay, averaging over 6,000 fish across 21 annual surveys. Adult sockeye were observed swimming along the northern and southern shorelines of the Eagle Bay terminal site in July and August, with greater abundance of fish along the northern margin, and reduced numbers of fish in August (Paradox 2018c, d). Although small areas of cleaned substrate were observed by snorkelers along the margin near the terminal site, none were subsequently developed into redds. A repeat survey in September revealed few adult sockeye along the northern margin, and no further evidence of spawning or spawning behaviors was observed, although heavy spawning activities had already commenced in Knutson Bay during August. Additional information on fish resources in Iliamna Lake is described above. Two anadromous tributaries flow into Eagle Bay, including Eagle Bay Creek (AWC 324-10-10150- 2239), which is listed for coho rearing, sockeye spawning, and the presence of Arctic char. The AWC tributary 324-10-10150-2235 is on the opposite shore of Eagle Bay from the port site, and is listed for sockeye spawning and presence of Arctic char. Historical spawner counts in Eagle Bay Creek have ranged from zero in 1963 to over 30,000 fish in 1975 (Morstad 2003). Geomorphic studies conducted in 2018 describe beaches and nearshore lake habitats at potential ferry terminal locations, including Eagle Bay North and Eagle Bay South (Paradox 2018b). Two habitat transects were measured at the Eagle Bay North location, which revealed an average slope of 13 percent, and substrates dominated by clean rounded gravel with few fines. The two Eagle Bay South transects had average gradients of 10 and 11 percent, with substrates ranging from well-rounded gravel on the beach and nearshore areas to sub-angular cobbles and boulders at depths greater than 5 feet.
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As depicted in Figure 3.24-19, spawning surveys have shown heavy use of the northeastern arm of Iliamna Lake, with highest densities associated with the main island archipelagos, Pedro Bay, and the Newhalen shoreline. Lower densities of spawning have been observed near Eagle Bay. The 29-mile ferry route for Alternative 2 traverses the eastern portion of Iliamna Lake, including Eagle Bay and the islands important to spawning sockeye salmon (Porcupine Island, Flat Island, Ross Island, Triangle Island, and Eagle Island), as well as the full length of Pile Bay (see Figure 3.24-19). Lower densities of spawning have been observed near Eagle Bay or along the southern beaches of Pile Bay (Southeast Beaches and Finger Beaches), which possesses minimal littoral habitat, than in other bays and islands in the eastern basin (Morstad 2003). Although the islands contain extensive littoral shoal habitat, the ferry route would remain well offshore, where depths range from 200 to over 900 feet.
North and South Ferry Terminal Sites Alternative 1 would include a north ferry terminal just west of the UTC mainstem outlet to the lake, and a south ferry terminal situated west of Kokhanok and the Gibraltar River. The south ferry terminal site would also be used under the Applicant’s Preferred Alternative. Geomorphic studies conducted in 2018 describe beaches and nearshore lake habitats of the terminal locations (Paradox 2018b). The north ferry terminal site is characterized by a wide, gently sloping sand/gravel beach. Beach slopes averaged 13 to 18 percent at three measured transects; substrate consists of sand and rounded gravel with some cobbles at depth. The south terminal site consists of a gravel beach backed by a 20- to 30-foot bluff that transitions to a boulder beach at the bedrock point to the east. Average gradients at the three transects range from 11 to 17 percent. A small stream to the west of the terminal infiltrates the gravelly beach and provides a potential source of upwelling groundwater in the lake. Fish and habitat surveys were conducted in 2018 near the ferry terminal locations in Iliamna Lake (Figure 3.24-19). Nearshore fish were surveyed May through August near the ferry terminal locations using seine nets, snorkel surveys, and aerial visual surveys from a helicopter (Paradox 2018b, c, d). The two most abundant species captured or observed in the seine and snorkel surveys were threespine stickleback and sockeye salmon. Other species captured or observed near the ferry terminal sites were chum salmon, coho salmon, pink salmon, Dolly Varden, longnose sucker, ninespine stickleback, pond smelt, and sculpin. No salmon spawning or pre- spawning behaviors were observed at the north or south ferry terminal locations, although adult sockeye salmon were observed from aerial surveys at every location in July and August. The natural gas pipeline segment under the Applicant’s Preferred Alternative would cross the lake from Newhalen to the south ferry terminal, as compared to the route across the lake from the north to south ferry terminals described for Alternative 1 (Figure 3.24-19). Neither the ferry crossing from the Eagle Bay terminal to the south terminal under the Applicant’s Preferred Alternative, nor the crossing from the north terminal to the south terminal under Alternative 1 would intersect known sockeye spawning habitat. However, the ferry route under the Applicant’s Preferred Alternative would pass within 0.35 to 0.5 mile of the Eagle Bay Island and Rabbit Island groups, each of which have supported beach spawning of up to 20,000 to 40,000 sockeye in some years (Morstad 2003).
Kokhanok East A variant to Alternative 1 would place the ferry terminal in the more protected waters of Kokhanok Bay, approximately 10 miles east of the south terminal (Figure 3.24-19). The ferry route would pass within 0.2 to 1.5 miles of several islands and Lookout Peninsula, over depths mostly between 60 and 150 feet. The shoreline here is generally rocky and deepens rapidly, suggesting that it is
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Page 30 of 188 PEBBLE PROJECT CHAPTER 3: AFFECTED ENVIRONMENT PRELIMINARY FINAL ENVIRONMENTAL IMPACT STATEMENT unlikely to be preferred spawning habitat (PLP 2018-RFI 078). The pipeline corridor in Iliamna Lake would mostly follow the same path as Alternative 1, but would come ashore east of Kokhanok, joining a road corridor extending east 5.4 miles to the ferry terminal variant, then south 6 miles to join the Alternative 1 route to Amakdedori port, 21 miles to the east. Specific fish sampling data are not currently available on fish resources for the Kokhanok East Ferry Terminal Variant or the seven channels that would be crossed via culverts along the Kokhanok East section of the transportation and natural gas pipeline corridor; however, a single bridge crossing occurs over AWC stream 324-10-10150-2206, which is listed as supporting sockeye spawning and the presence of Arctic char.
Pile Bay Under Alternative 2, the ferry would cross from the Eagle Bay terminal to a ferry terminal at Pile Bay (see Figure 3.24-19). As described for Eagle Bay, the midwater route of the alternative ferry crossing would not intersect known sockeye spawning habitat, except at the ferry terminal site in Eagle Bay. Lower densities of spawning salmon have been observed along most of the southern shore of Pile Bay, which possesses minimal littoral habitat. However, Pile Bay serves as a migration route for upstream migrant salmon (and trout) to the Iliamna River, Pile River, and several other anadromous tributaries, as well as an outmigration pathway for ocean-bound juvenile salmon.
3.24.4.6 Cook Inlet Portion of the Natural Gas Pipeline Corridor The affected environment of the Cook Inlet portion of the natural gas pipeline is the same for all alternatives.
Aquatic Habitat Cook Inlet is a semi-enclosed estuary in southcentral Alaska that extends northeast approximately 180 miles from the Gulf of Alaska north to Anchorage. Cook Inlet is fed by a wide variety of rivers, the largest being the Susitna River at the northern end of the inlet, and the Kenai River draining into the middle reach of the inlet. The substrate composition of Cook Inlet is mostly mudflats along the margins, with sand, clay, pebbles, and cobbles farther offshore. Rocky outcrops and shoals occur in many areas, especially in association with bays and islands. An assessment of nearshore substrate composition between Cook Inlet and Shelikof Strait showed extensive boulder armoring, with approximately 49 percent exposed rocky shore, 31 percent mixed sand and gravel, 12 percent gravel beaches, 3 percent exposed tidal flats, and 2 percent coarse-grained sand (BOEM 2016b). General flow patterns include a net inflow along the eastern side of the inlet, including the Alaska Coastal Current, with net outflow along the western side (Burbank 1977). Inflow of turbid glacial streams generally produces low visibility, particularly in proximity to river mouths and along the western outflow. Cook Inlet is subject to large tidal fluctuations (up to 40 feet), which results in strong rips and currents in many locations. Winter temperatures result in extensive ice formation in the upper inlet and in isolated bays, with maximum ice coverage in January; breakup typically occurs between March and May. The natural areas of Cook Inlet most likely to be affected by the pipeline are the Lower Cook Inlet central zone and Kamishak Bay (Science Applications, Inc. 1977). The lower central zone is defined as the region north of the Barren Islands between Kamishak and Kachemak bays, and south of a line from Anchor Point to Chinitna Bay. This zone is an area dominated by tidal circulation, with mostly poorly sorted sands as bottom sediments (Science Applications, Inc.1977). Approximately half of the 104 mile pipeline route would traverse depths of 200 feet or more, with a substrate largely composed of sand, shells, and pebbles.
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Direct Loss of Aquatic Habitat
Mine and Port Access Roads and Overland Gas Pipeline In terms of magnitude and extent, the road and onshore pipeline corridors of the Applicant’s Preferred Alternative would cross anadromous and resident fish streams, directly impacting 3.5 acres of perennial stream habitat (Table 4.24-1). The Anadromous Fish Act (Alaska Statute [AS] 16.05.871-.901) requires that an individual or government agency provide prior notification and obtain permit approval from the Alaska Department of Fish and Game (ADF&G) before altering or affecting “the natural flow or bed” of a specified waterbody, or fish stream. Bridge and culvert design, streamflows, and habitat loss would be reviewed by ADF&G during the permitting process. ADF&G permit stipulations could include seasonal restrictions on instream activities to avoid impacts to habitat during critical life stages (e.g., spawning and egg development). Single- span bridge crossings would be designed to maintain a riparian buffer between the bridge abutments and the active channel. Under the Applicant’s Preferred Alternative there would be large multi-span bridges across the Newhalen and Gibraltar rivers. There would be a permanent loss of some habitat within the direct footprint of bridge piers on these rivers. Free passage of resident and anadromous fish may be temporarily interrupted, but would continue unimpeded after construction is completed. Construction of all stream crossings would avoid spawning migration windows as much as possible; and where potential in-stream work could obstruct passage of fish for longer than 48 hours, diversion methods could be employed under the guidance of the ADF&G. Juvenile and adult fish passage facilities may be incorporated on all water diversion projects (e.g., fish bypass systems). Habitat at the immediate location of culverts would be altered, but fish would continue to use the streams. The duration of habitat disturbance from construction effects would be short- term and temporary, but would be expected to occur if the project is permitted and built.
Iliamna Lake—Ferry Terminals and Natural Gas Pipeline Aquatic Lake Habitat Lost due to Ferry Terminal Construction—Facilities at the Eagle Bay and south ferry terminals would extend into bay or lake waters. The magnitude and extent of impacts to aquatic lake habitat are such that the ramps would cover approximately 0.56 acre of Eagle Bay benthic habitat and 1.1 acres of benthic habitat at the south terminal. Discharge of fill material to construct the ferry terminals and ramps would permanently remove this aquatic habitat. As described in Section 3.24, Fish Values, adult sockeye were documented along the northern and southern shorelines at the Eagle Bay ferry terminal location. Spawning surveys have shown heavy use of the northeastern arm of Iliamna Lake, with highest densities associated with the main island archipelagos, Knutson Bay, Pedro Bay, and Pile Bay. Lower densities of spawning have been observed near Eagle Bay or in the eastern extremity of Pile Bay. Surveys indicate that the habitat lost at the south ferry terminal receives limited use as rearing habitat by juvenile Pacific salmon, and is not used for spawning by Pacific salmon (Paradox 2018b). The combined loss for the two terminals of less than 2 acres is minimal relative to the approximately 300 linear miles of littoral habitat that will remain undisturbed in Iliamna Lake, particularly given the limited use for salmonid rearing and absence of adult spawning in these locations (Owl Ridge 2019). No freshwater mussels have been documented in the Eagle Bay and south ferry terminal footprints. Riprap placed around the landing ramp would be similar in size and character to the boulder habitat currently present in both locations, and would not represent a novel habitat feature. Riprap would be colonized in the short-term, and subsequently used by fish and their prey organisms. Habitat abutting fill locations may be disturbed or degraded during construction,
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Page 32 of 188 PEBBLE PROJECT CHAPTER 4: ENVIRONMENTAL CONSEQUENCES PRELIMINARY FINAL ENVIRONMENTAL IMPACT STATEMENT but the duration of the impact would be short-term, because habitat is expected to recover after construction activities are completed. Aquatic Lake Habitat Lost due to Natural Gas Pipeline Construction—Construction of the natural gas pipeline across Iliamna Lake would have permanent and temporary effects on lake habitat. Horizontal directional drilling (HDD) and trenching from lay barges would be used to install the pipeline segments from the lakeshore into waters deep enough to avoid navigational hazards. HDD fluid potentially lost through subsurface fractures (frac-out) could bury lake benthic habitat. Details regarding prevention, detection, and response to a potential frac-out or drilling fluid release would be addressed in site-specific HDD plans (see Chapter 5, Mitigation). Discharges of drill fluid and drill cutting water are regulated by the APDES General Permit AKG320000 – Statewide Oil and Gas Pipelines. Trenching methods for pipe laying would include an extended-reach backhoe working from a small barge with spuds to maintain position (effective in water depths up to 30 feet [9.1 meters]) or a jet sled operated from the lay barge. A 30-foot (9.1-meter-)-wide corridor would be disturbed during trenching to install the submerged portions of the natural gas pipeline plus any areas where spoils would be temporarily side cast. Sections of pipe up to several miles in length would be welded on shore and pulled out into Iliamna Lake along the bottom, and/or using floats. Long segments of pipe would be joined using divers and underwater welding. The pulling of pipe along the lake bottom has the potential to harm habitat in areas where the pipe encounters the lake substrate; other areas (e.g., lake substrate depressions and areas where the pipe does not make complete contact with the substrate) would be left relatively intact. Areas affected by the pipe pulling would be expected to recolonize; therefore, the duration of impacts would be temporary. There would be permanent, direct mortality of any benthic organisms beneath the pipeline footprint on the bottom of Iliamna Lake. However, given the water depths, lack of light, and oligotrophic status of Iliamna Lake, impacts to deep-water benthic areas and invertebrates are not expected to be substantial, and this habitat would be expected to recolonize in 1 to 2 years. For example, pelagic, open-water areas are the dominant habitat used by sockeye salmon juveniles in the lake (Paradox 2018c). To the extent this benthic habitat has value to salmon and resident fish species, the benthic habitat under the pipeline would be permanently lost, but the pipeline itself would provide additional areas that can be colonized by invertebrates. Pipe-laying operations may result in temporary habitat disturbance in and near the construction area, but fish habitat adjacent to the pipeline would be expected return to pre-activity conditions after the activity ceases. These impacts would be certain to occur if the project is permitted and the natural gas pipeline is installed.
Cook Inlet Potion of the Natural Gas Pipeline The magnitude and extent of impacts from construction and operations would include long-term impacts to 11 acres of benthic habitat during construction and into operations, and short-term impacts to 628 acres of benthic habitat during construction. The short-term impacts area would include approximately 6.8 acres of weathervane scallop (Patinopecten caurinus, also known as the Pacific giant scallop) habitat. An additional 21 acres of aquatic benthic habitat would be temporarily impacted during construction from anchor and cable sweeps. The 104-mile-long, 12-inch-diameter natural gas pipeline would be constructed on the floor of Cook Inlet between the Kenai Peninsula and Amakdedori port. HDD would be used to install the pipeline segments from the shoreline into waters deep enough to avoid navigational hazards, and potential impacts are similar to those described previously. Pipeline construction would involve temporary displacement of approximately 628 acres of substrate material along with the
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Page 33 of 188 PEBBLE PROJECT CHAPTER 4: ENVIRONMENTAL CONSEQUENCES PRELIMINARY FINAL ENVIRONMENTAL IMPACT STATEMENT associated benthic organisms. However, with installation of the pipeline directly on the seabed, the artificial, solid surface of the pipeline would change approximately 11 acres of seabed from natural, sandy/silty substrate to an artificial solid surface. It is expected that the pipeline would be quickly recolonized by marine life, and soft substrate areas disturbed by the construction would also recolonize. The magnitude and extent of potential impacts from the placement of anchors for the pipe-laying barge would include disruption to the seafloor habitat structure. Impact sources include anchor scarring each time an anchor is set, and the scraping or sweeping of the seafloor from the movement of the anchor cables across the seafloor (cable sweep). The typical sea anchor footprint is generally small, but the depression could be 7 to 8 feet in soft bottom (Owl Ridge 2019). The weight of the anchor and potential depth of the scar could potentially result in disruption to the habitat structure within the footprint of the scar. These scars would be short-term, because they would fill in with marine sediments once the disturbance ends. Habitat losses resulting from the natural gas pipeline installation would be permanent.
Displacement, Injury, and Mortality of Fish and Benthic Organisms
Mine and Port Access Roads and Overland Gas Pipeline Direct displacement, injury, or mortality of fish could occur during construction of bridges, culverts, and the overland portions of the natural gas pipeline. Culverts and Bridges—Temporary water diversions or dewatering of stream reaches during construction could result in direct mortality of fish due to stranding and desiccation. Entrainment or impingement at intake screens during water withdrawals could also result in direct mortality or injury. Increased sedimentation may cause displacement or injury, and is discussed below and in Section 4.18, Water and Sediment Quality. ADF&G is responsible for review and verification of bridge and culvert designs. Permit stipulations could include seasonal restrictions to protect critical life stages (e.g., spawning and incubation) to avoid or minimize injury or mortality. Construction of stream crossings may avoid spawning migration windows as much as possible, and where potential in-stream work could obstruct passage of fish for longer than 48 hours, diversion methods may be employed under the guidance of the ADF&G. Juvenile and adult fish passage facilities would be incorporated for all water diversion projects (e.g., fish bypass systems) as per ADF&G permit stipulations. Fish could also be directly impacted by noise and vibration during backhoe use to install culverts and bridges, and by vibration and noise from traffic using those bridges. Noise and vibration studies and impact evaluations in the Point Mackenzie Rail Extension Final Environmental Impact Statement used the Federal Transit Administration general assessment method (FTA 2018). As summarized in the Port MacKenzie EIS, peak particle velocities for bulldozer operations during construction were estimated to range from 0.000056 to 0.006372 inch per second (in/s) 145 to 3,400 feet away from the construction activity. These velocities are less than the ADF&G peak particle velocity limit of no more than 2.0 in/s in spawning gravels during the early stages of embryo incubation (Timothy 2013). Based on the foregoing data, particle velocities during bulldozer use transferred to spawning substrates through bridge piers or culverts or from truck traffic during mine operations are unlikely to result in a detectable effect on incubating salmonid eggs, survival to emergence, or juvenile and adult abundance. Blasting—Fish could be injured or killed due to blasting near anadromous and resident fish streams. Effects of blasting on fish are described below. Blasting would be needed for road and pipeline construction. Blasting would occur along approximately 25 miles of the south access road between Amakdedori port and the south ferry terminal, and along 1.8 miles on the mine access
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Page 34 of 188 PEBBLE PROJECT CHAPTER 4: ENVIRONMENTAL CONSEQUENCES PRELIMINARY FINAL ENVIRONMENTAL IMPACT STATEMENT road between the mine site and the Eagle Bay ferry terminal. Estimated pressure and vibration forces generated by blasting at gravel mine sites and along the transportation corridor have not been calculated, pending future blasting plans; however, blasting during construction would be done following the guidelines established in the 2013 ADF&G Technical Report (No. 13-03) Alaska Blasting Standard for the Proper Protection of Fish. Trenching and HDD—Direct displacement, injury, or mortality of fish could occur during HDD and trenching activities associated with construction of the natural gas pipeline. Fish could be directly impacted (smothered or buried) by the loss of HDD drilling fluid through subsurface fractures (frac-out). Drilling fluid is typically composed of only water and bentonite, and poses a low risk to aquatic life. However, fluid loss may result in a temporary increase in turbidity or siltation that can negatively impact aquatic life by covering spawning and feeding areas, and clogging fish and invertebrate gills. Monitoring would be conducted throughout the HDD process to determine whether a subsurface fluid loss had occurred. To ensure that the pressure on the drilling fluid is set to match the geological formations encountered, the pressure levels would be set as low as possible to be effective, and would be closely monitored. The pressure should not exceed what is needed to penetrate the formation. A significant drop in pressure or drop in mud return could indicate a potential fluid loss, and drilling would be halted immediately. Details regarding prevention, detection, and response to a potential frac-out or drilling fluid release would be addressed in the HDD plan and SWPPP. Trenching impacts could include mortality of fish related to diversion and dewatering activities and displacement due to temporary increases in turbidity. Juvenile and adult fish passage facilities (e.g., fish bypass systems) may be incorporated on all water diversion project as per permit stipulations. Water Withdrawals—The Alaska Department of Natural Resources (ADNR) and ADF&G are responsible for permitting water withdrawals from fish-bearing waters. Permit conditions would be protective of fish migration and critical life stages. Permit conditions would also restrict rates, volumes, and total withdrawals to protect fish and fish habitat. Water pump intake screens used for dewatering and water withdrawal would be designed, constructed, and certified according to ADF&G standards to prevent fish impingement to reduce impacts. Fish would not be expected to be exposed to injury, displacement, or mortality due to water withdrawals.
Iliamna Lake—Ferry Terminals and Natural Gas Pipeline Iliamna Lake Ferry Terminals—As described in Section 3.24, Fish Values, the Eagle Bay and south ferry terminal locations are used for rearing by juvenile salmonids in the spring. Although low densities of spawning salmon have been observed near Eagle Bay, the terminal locations are not important for sockeye salmon rearing, adult sockeye salmon spawning, or the rearing of other salmonid species (Hart Crowser 2018a; Hart Crowser 2018b; Paradox 2018a). Threespine stickleback are the most common species at the terminal locations. Construction of the ferry terminal docking facilities is not likely to cause widespread injury or mortality to fish, but may temporarily displace them from the immediate area. These impacts are certain to occur if the project is permitted and the ferry terminals are constructed. Natural Gas Pipeline Crossing Iliamna Lake—The natural gas pipeline segment under the Applicant’s Preferred Alternative would cross the lake from Newhalen to the south ferry terminal, as compared to Alternative 1, with the route across the lake from the north to south ferry terminals, as described in Section 3.24, Fish Values. Construction of the natural gas pipeline across Iliamna Lake using HDD, trenching, and pipe pulling methods previously described could lead to displacement of fish, but is not likely to cause widespread direct injury or mortality of fish. Sockeye
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Page 35 of 188 PEBBLE PROJECT CHAPTER 4: ENVIRONMENTAL CONSEQUENCES PRELIMINARY FINAL ENVIRONMENTAL IMPACT STATEMENT salmon are known to use shoreline habitat for spawning (see Section 3.24, Fish Values), and therefore could be potentially affected by disturbance and increased turbidity during construction. Nearshore trenching at Iliamna Lake has the potential to temporarily disturb and displace sockeye salmon fry and adults during construction, but fish use is expected to return to previously existing conditions after the activity ceases.
Iliamna Lake Ferry Operations As described in Section 3.24, Fish Values, neither the ferry crossing from the Eagle Bay terminal to the south ferry terminal under the Applicant’s Preferred Alternative, nor the crossing from the north ferry terminal to the south ferry terminal under Alternative 1 would intersect known sockeye spawning habitat. However, the ferry route under the Applicant’s Preferred Alternative would pass within 0.35 to 0.5 mile of the Eagle Bay Island and Rabbit Island groups, each of which have supported beach spawning of up to 20,000 to 40,000 sockeye in some years (Morstad 2003). Juvenile sockeye have the highest potential to interact with the ferry operations due to their relative abundance and wide distribution throughout Iliamna Lake. Propeller Entrainment or Injury—Assessment of the potential for direct injury or mortality of anadromous or resident fish from vessel propellers is limited to a few studies (Holland 1986; Killgore et al. 2011; Whitfield and Becker 2014). A review of these publications indicated that the potential exists for chronic, direct adverse interaction of ferry propeller blades and various life stages of migratory and non-migratory fish species throughout the 20-year operations phase. The ferry has the potential to entrain fish into the turbulent zone created by propeller blades, although benthic species or midwater species larger than 10 millimeters are less susceptible to entrainment (Killgore et al. 2011). Sockeye fry hatch-out much larger than 10 millimeters in length (Beacham and Murray 1991), and typically remain nearshore until early summer (Hoag 1972). Rich (2006) found that fry densities were highest in the eastern basin east of Eagle Bay. In contrast, yearling sockeye exhibit pelagic, open-water behavior; however, they are larger (i.e., bigger than 70 millimeters) (Rich 2006) and stronger swimmers, and would be expected to detect and avoid propeller-related impacts. Also, as described in Section 3.24, Fish Values, juvenile sockeye typically occupy deeper water during daylight hours, then ascend into shallower water (although often deeper than propeller depths) at night or at dusk (Clark and Levy 1988; Schuerell and Schindler 2003). Consequently, direct interaction between juvenile sockeye and the ferry, which would operate during the day, is expected to be limited due to the fish’s diel vertical migration patterns as described in Section 3.24, Fish Values. Although sockeye are known to exhibit diel movement patterns in winter (Steinhart and Wurtsbaugh 1999), it is unknown if juveniles would be more likely to encounter the ferry during the winter season, when light intensity remains low during daylight hours. Although light penetration would be greater in the ice-free path of the ferry, it is likely that surface waters would also be colder in the ferry’s path, which could discourage occupation of near-surface depths by juvenile sockeye. Although possible, propeller strikes or shear forces could result in fish injury or mortality. Impacts are expected to be localized at the individual level, and would be expected to occur if the project is permitted and constructed. Wake Impacts—Ship wake can cause fish to be stranded and suffer mortality (Pearson et al. 2006). Pearson et al. (2006) noted that fish stranding occurred primarily during nighttime vessel passages, and no stranding occurred at the same locations during daytime passages. A radio telemetry study by Otter Tail (2010) on the Kuskokwim River reported no evidence of stranding of seaward-emigrating salmon when the prevailing wake height was less than 1.5 inches along the gravel bars surveyed; however, these fish did not occupy confined segments of the river. Habitat descriptions for the Applicant’s Preferred Alternative ferry terminal locations are provided in Section 3.24, Fish Values. In contrast to studies conducted on rivers, stranding of fry from ferry
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Page 36 of 188 PEBBLE PROJECT CHAPTER 4: ENVIRONMENTAL CONSEQUENCES PRELIMINARY FINAL ENVIRONMENTAL IMPACT STATEMENT wake is not expected to be a source of mortality in Iliamna Lake due to the perpendicular route of ferry travel in relation to the shoreline. The magnitude of the wake produced by the Iliamna Lake ferry is expected to be 4 inches at the ferry’s 6-knot approach speed; however, the wake would dissipate within 30 feet of the hull (PLP 2018-RFI 013). Consequently, any impacts on juvenile and adult fish due to boat wake would be limited both spatially and temporally. Noise and Vibration Impacts—Fish have been shown to react when engine and propeller sounds exceeds a certain level (Olsen et al. 1983; Ona 1988; Ona and Godo 1990). Avoidance reactions have been observed in fish such as cod and herring when vessel sound levels were 110 to 130 dB re 1 µPa rms (Olsen 1979; Ona and Godo 1990; Ona and Toresen 1988). Vessel sound source levels in the audible range for fish are typically 150 to 170 dB re 1 μPa/Hz (Richardson et al. 1995). The vessels used during the activities would be expected to produce levels of 170 to 175 dB re 1 µPa rms when in transit. Based on the reports in the literature and the predicted sound levels from these vessels, there may be some avoidance by fish in the immediate area. Where fish or invertebrates responded to noise, the affects were temporary and of short duration (Popper et al. 2005). Consequently, disturbance to fish species would be short- term, and fish would return to their pre-disturbance behavior once the activity ceases.
Cook Inlet Portion of the Natural Gas Pipeline Marine fish would not be expected to suffer direct mortality or injury during pipe-laying operations, but could be temporarily displaced from the immediate vicinity of construction activity. As described under direct loss of aquatic habitat, there would be permanent, direct mortality of benthic organisms beneath the natural gas pipeline footprint on the seabed of Cook Inlet, including about approximately 6.8 acres of weathervane scallop beds that would be temporarily impacted by placement of the pipeline. Scallop surveys of these beds showed scallop densities ranging from 0.01 scallop per square meter (scallop/m2) to 0.21 scallop/m2 (Gustafson and Goldman 2012). Weathervane scallops have limited ability to avoid the impacted area, which may result in weathervane scallop mortality. Assuming a similar density for the natural gas pipeline construction area, construction could result in injury or mortality of 466 to 9,774 scallops. The area of weathervane scallop beds permanently affected is about 0.2 acre, and is small considering the weathervane scallop range in Cook Inlet. Because the area of localized effects of the actions is small compared to the weathervane scallop range in Cook Inlet that would not be affected, and estimated low number of potential injured or killed scallops, impacts would be undetectable. The impacts on weathervane scallop beds would be certain to occur if the project is permitted and the natural gas pipeline is constructed. Benthic infauna individuals would likely suffer mortality from the placement of anchors for the pipe-lay barge. Impact sources include anchor scarring each time an anchor is set, and the scraping or sweeping of the seafloor from the movement of the anchor cables across the seafloor (cable sweep). The weight of the anchor and potential depth of the scar could potentially result in mortality of benthic fauna, including weathervane scallops. The benthic fauna would be expected to recover; therefore, the duration of the impacts would be short-term.
Changes in Surface Water Flows and Iliamna Lake Circulation
Mine and Port Access Roads and Overland Gas Pipeline Access Road Construction—Except temporarily during construction, potential impacts on streamflows are not expected to occur at bridge and culvert crossings. As discussed previously, the ADF&G is responsible for activities in fish-bearing waters. Bridge and culvert design, streamflows, fish passage requirements, and habitat loss will be reviewed by ADF&G per the State’s Anadromous Fish Act (AS 16.05.871-.901) during the permitting process. Permit
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Page 37 of 188 PEBBLE PROJECT CHAPTER 4: ENVIRONMENTAL CONSEQUENCES PRELIMINARY FINAL ENVIRONMENTAL IMPACT STATEMENT stipulations may include seasonal restrictions on instream activities to avoid impacts to habitat during critical life stages (e.g., spawning and egg development). Unimpaired passage of Pacific salmon species may be temporarily interrupted, but would continue unimpeded after construction. Routine inspection and maintenance of culverts, bridges, and roads would be regularly conducted in compliance with right-of-way (ROW) and ADF&G permit conditions, if issued, to ensure that culvert-related erosion, wash-out, or debris blockage do not result in permanent impacts to streamflow or downstream habitat. More stringent monitoring and maintenance standards may be required by ROW lease stipulations from state and local governments. Water Withdrawals—Water withdrawals would be expected to temporarily affect streamflows. Water withdrawals would occur at lakes, ponds, and streams along the road corridor for dust control and hydrostatic testing during the summer construction seasons. The ADNR and ADF&G are responsible for permitting water withdrawals from fish-bearing waters. ADF&G reviews permit applications to ensure that water withdrawals are protective of fish by verifying that adequate flows for fish passage are available, particularly during critical life stages, and water levels are sufficient to avoid stranding juveniles and dewatering redds. Permit conditions would set limits on water withdrawal (typically maximum pumping rate, maximum gallons per day, and total volume withdrawn per stream) necessary to protect fish and their habitat, and would require the installation of screens at water intake points to prevent fish entrapment. Disposal methods for hydrostatic test water would be developed in accordance with ADEC APDES General Permit AKG320000 for implementing the federal Clean Water Act with respect to energy dissipation and sediment control. No chemicals would be added to the hydrostatic test waters. The degree of impact is temporary. Overland Natural Gas Pipeline Construction—The final configuration of the natural gas pipeline would generally be in the prism of the access road. Stream crossings would be open cut or HDD at culvert crossings, and attached to bridges at large river crossings. This configuration would reduce the risk of ponding, interception of surface water flows, and sedimentation, as related to the pipeline ditch. The magnitude and extent of potential impacts to groundwater and surface water during pipeline construction would involve interception of shallow groundwater and surface water during trenching activities, which would be captured and locally flow along the trench backfill. Ditch plugs are typically installed to intercept shallow groundwater flows. Backfilling would occur immediately following end of construction. Permits would stipulate that surface water flows would be returned to their normal condition. Typical BMPs for surface water management could include maintaining natural surface water patterns; crowning of ditch backfill to allow for settlement to original ground level; contouring of surrounding terrain; construction of settlement infiltration basins; and prompt revegetation of riparian and wetlands and a robust monitoring and maintenance program (see Chapter 5, Mitigation). Ditch dewatering and hydrotest water would be discharged to approved sites as per ADEC requirements. As stated previously, ADF&G is responsible for all work in fish-bearing streams. Pipeline construction would be subject to design considerations, restoration requirements, and timing windows, as specified by ADF&G. The duration of impacts could extend beyond the life of the project (i.e., permanent), because the pipeline would be abandoned in place. The likelihood of the impact would be certain if the project is permitted and the pipeline is constructed.
Iliamna Lake Fill placed in the nearshore zone to construct ramps at Eagle Bay and south ferry terminal locations could modify water circulation patterns by changing the direction or velocity of water
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Page 38 of 188 PEBBLE PROJECT CHAPTER 4: ENVIRONMENTAL CONSEQUENCES PRELIMINARY FINAL ENVIRONMENTAL IMPACT STATEMENT flow; alter the location, structure, and dynamics of aquatic communities, including prey; and alter shoreline and substrate erosion and deposition rates.
Changes to Stream and Lake Productivity
Access Roads and Overland Gas Pipeline The access roads and pipeline would cross anadromous and resident fish streams. In some locations, such as culvert crossings, the road/pipeline footprint would impact riparian and floodplain connectivity in the 100-year floodplain. This could reduce the input of terrestrial nutrients, thereby affecting downstream productivity. The duration of impacts would be permanent. Loss of riparian vegetation can also result in increased erosion and stream sedimentation and reduction in stormwater retention capacity, and can increase flows and alter instream functions, including productivity. In terms of magnitude and extent, the road/pipeline footprint and associated crossing structures would directly impact riparian vegetation, and interrupt floodplain connectivity in certain locations. The duration of the impact to riparian vegetation would be for the life of the project, and would be expected to occur if the project is permitted and built. BMPs such as road fill drain culverts may be considered during design and permitting to maintain floodplain connectivity, and to maintain riparian habitat functions.
Iliamna Lake—Ferry Terminals and Natural Gas Pipeline In terms of magnitude, duration, and extent, there would be short-term, indirect disturbance effects from the construction of ramps at the ferry terminals, including the loss of less than 2 acres of benthic habitat under the Eagle Bay and south ferry terminal footprints combined. As described previously, riprap placed around the landing ramps would be similar in size and character to existing boulders in Iliamna Lake, and would be colonized in the short-term, and subsequently used by prey organisms. The aquatic food web in Iliamna Lake would not be expected to be impacted by terminal construction and ferry operations. HDD would be used to install the natural gas pipeline segments from the lakeshore into waters deep enough to avoid navigational hazards, then laid and secured on the lake bottom. In terms of magnitude, duration, and extent of impacts, there would be local, temporary impacts during construction, and permanent impacts to Iliamna Lake benthos, zooplankton, and overall productivity. However, the impact would be certain to occur if the project is permitted and constructed.
Changes to Marine Productivity
Cook Inlet Portion of the Natural Gas Pipeline In terms of magnitude, duration, and extent, construction of the natural gas pipeline would temporarily impact approximately 6.8 acres of the northern Kamishak Bay weathervane scallop beds during pipeline construction. A literature review of studies of benthic community change around platforms suggests that benthic communities may return to baseline conditions 1 year after construction (Neff 2016). Long-term changes to benthic habitat would affect rearing and adult Pacific salmon and marine species in depths of less than 80 meters. Fish assemblages both on and off pipelines were found to be similar; however, two to three times higher biomass of large-body commercial species were found to be associated with proximity to pipelines (Bond et al. 2018). Pelagic and semi-pelagic
FEBRUARY 2020 PAGE | 4.24-33
Page 39 of 188 PEBBLE PROJECT CHAPTER 4: ENVIRONMENTAL CONSEQUENCES PRELIMINARY FINAL ENVIRONMENTAL IMPACT STATEMENT fishes may re-inhabit the pipeline corridor within hours to days after construction operations cease and the trenched areas have refilled. Pipeline construction activities would be expected to have impacts on individual fish and shellfish, but would not be expected to have population-level impacts. Consequently, the overall effects of pipeline construction and operations activities on fish and shellfish productivity would likely be undetectable. Long-term impacts to 11 acres of benthic habitat would be expected. This impact would occur if the project is permitted and the pipeline is built.
Increased Stream and Lake Sedimentation and Turbidity
Mine and Port Access Roads In terms of magnitude, duration, extent, and likelihood, road construction, maintenance, and use can result in short- and long-term impacts to streams and drainages from increased surface erosion and deposition of fine sediments; alteration of water temperature; delays or barriers to fish migration at culverts; changes in streamflow and hydrologic processes; and introduction of invasive plant species (Limpinsel et al. 2017). Surface erosion can also result from clearing and grading activities; and from poorly surfaced or maintained roads with steep grades, high traffic volume, and insufficient stormwater management facilities. Accumulations of fine sediments in streams have been associated with decreased fry emergence, reductions in winter carrying capacity and benthic production, and changes in species composition in benthic invertebrate communities (NMFS 2011a). The transportation corridor road would be constructed through existing bedrock and glacial fluvial surface deposits using locally processed materials with low erosion potential. Therefore, the increased water turbidity due to erosion and sedimentation are expected to be limited to bridge or culvert crossings. As stated previously, ADF&G is responsible for permitting any activities in fish-bearing waters. Bridge and culvert construction activities in anadromous waters would be authorized by ADF&G and documented in ADF&G permit requirements to avoid impact to critical fish life stages (e.g., spawning and egg incubation). Routine inspection and maintenance of culverts, bridges, and roads as required by ADF&G permit conditions would be conducted to ensure that drainage-structure–related erosion, wash-out, or debris blockage do not result in impacts to water quality or downstream habitat. The duration of construction-related sedimentation would be temporary and short-term, due to mitigation and control measures, State of Alaska permit stipulations, and timing windows. Additional monitoring, BMPs, and maintenance standards may be required by ROW lease stipulations from state and local governments. Operations are expected to require 35 truck round trips per day, which would result in dust impacts in proximity to roads, including at stream crossings. See Section 4.20, Air Quality, for additional discussion on extent and magnitude of fugitive dust generation. Implementation of dust suppression and enforcement of slow speed limits at all stream crossings would minimize dust- related impacts to aquatic ecosystems.
Overland Gas Pipeline The three construction techniques that would be used to cross waterbodies during the onshore installation of the natural gas pipe line are discussed below. Suspend Pipeline Beneath Bridges—This crossing method would place the pipeline and fiber- optic cable over the stream, suspended or secured to bridges; no sedimentation or turbidity impacts to fish or aquatic habitat would be expected.
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Page 40 of 188 PEBBLE PROJECT CHAPTER 4: ENVIRONMENTAL CONSEQUENCES PRELIMINARY FINAL ENVIRONMENTAL IMPACT STATEMENT
Horizontal Directional Drilling—This technique would place the pipeline beneath the stream bed. HDD typically results in minimal disruption to riparian vegetation adjacent to the stream, and no disturbance to the stream bed. Temporary turbidity or sedimentation impacts could occur due to frac-out. Potential impacts and mitigation measures were discussed previously. Stream Trenching—Water would be diverted, and a trench would be excavated using chain excavators, wheel trenchers, and/or backhoes. Side-cast material from the excavation of the trench would be temporary stored at an elevation greater than the Ordinary High Water mark of the creek, within the abutting 30-foot road construction buffer. The trench would be deep enough to provide the design soil/sediment cover depth over the top of the pipeline and fiber-optic cable. Construction and water diversion methods would vary, depending on soil type and stream channel characteristics. Excavators would generally be used in areas of steep slopes, high water tables, soils with cobbles and boulders, or deep trench areas such as river and stream crossings. Temporary turbidity and sedimentation impacts could occur from diverting rivers or streams, removing riparian vegetation, and excavating streambed materials (typical trench width is 8 feet). Juvenile and adult fish passage facilities would be incorporated on all water diversion projects (e.g., fish bypass systems) as required by permit. Turbidity and sedimentation impacts would be temporary during construction, and short-term until riparian vegetation becomes re-established.
Iliamna Lake—Ferry Terminals and Natural Gas Pipeline In terms of magnitude, duration, extent, likelihood, there would be local, short-term turbidity increases to the water column that could indirectly affect fish and benthic organisms during construction of the ramps at the south and north ferry terminals. As described in Section 4.16, Surface Water Hydrology, transport of suspended sediment by wind-driven currents along the shore would not be expected to persist or to cover a large geographic area. The increased water turbidity and indirect impacts on fish and aquatic life would be expected to occur if the project is permitted and constructed. Drilling mud (fluid) that would be used in the HDD pipeline crossing of Iliamna Lake poses a low chemical risk to waterbodies and wetlands (PLP 2018-RFI 051). However, loss of drilling fluid due to frac-out may result in a temporary increase in water turbidity or suspended solids that could negatively impact aquatic life by covering spawning/feeding areas and clogging fish gills.
Impacts to Fish Migration
Access Roads and Overland Gas Pipeline Potential impacts on fish passage are not expected to occur at stream crossings, except temporarily during construction. During construction, installation of culverts and open cuts for pipeline installation may increase water turbidity and suspended sediments; fish may avoid the turbid areas, thereby impacting migration. Culverts and water diversion projects would be designed to facilitate juvenile and adult fish passage (e.g., fish bypass systems) as per permit stipulations. The duration of impact would be that unimpaired passage of fish may be temporarily interrupted during construction activities, but would resume unimpeded after construction is complete. Implementation of BMPs would minimize the magnitude of impact on fish migration resulting from such disturbances. The culverts would be reviewed and verified by ADF&G during the permitting process. Migration disturbance from construction effects would be short-term, lasting only during the construction phase. The magnitude and extent of impacts would be such that fish may be temporarily disturbed or displaced from migrating, but would return to their prior patterns after the activity ceases; functional changes to habitat are not expected. Routine inspection and
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Page 41 of 188 PEBBLE PROJECT CHAPTER 4: ENVIRONMENTAL CONSEQUENCES PRELIMINARY FINAL ENVIRONMENTAL IMPACT STATEMENT maintenance of culverts, bridges, and mine and port access roads would be regularly conducted and reported, in compliance with regulatory requirements, to ensure that culvert-related erosion, wash-out, or debris blockage do not result in impediments to fish passage or degradation of downstream habitat. Short-term disturbance to fish and fish habitat would be expected to occur if the project is permitted and the access roads and pipeline are constructed.
Iliamna Lake—Ferry Terminals The short rock and gravel ramps required for the ice-breaking ferry at the Eagle Bay and south ferry terminals would not be expected to block fish passage or migration patterns in Iliamna Lake. ABR (2007) assessed the effects associated with two causeways extending approximately 2 miles from shore into the Beaufort Sea near Prudhoe Bay Alaska. The study found that the Arctic cisco population was more sensitive to environmental variability than to development activities; breaching of causeways had little effect on Arctic cisco migration; and overall, the effects of causeways were not detectable in the Arctic cisco population. The spatial and temporal extent of the causeways in Prudhoe Bay project is of a much larger scale (2 miles versus 155 feet) as compared to the ferry terminal ramps; therefore, impacts of the physical presence of the ramps to fish migration would be expected to be undetectable.
Cook Inlet Portion of the Natural Gas Pipeline The length of the natural gas pipeline in Cook Inlet would be 104 miles but would not be expected to impact fish passage or migration patterns in Cook Inlet. The diameter of the pipe resting on top of the sea floor would be within in the natural range of seafloor topography, and would therefore not be expected to hinder marine macroinvertebrate (e.g., crabs) or fish migration patterns. HDD methods would be used to install the pipeline at the terrestrial-marine interface with Cook Inlet to a subsurface depth that would prevent navigational hazards; this in turn would not impede fish passage or migration in nearshore areas. As described in Section 4.6, Commercial and Recreational Fisheries, the salmon fishery occurs in the top 30 feet of the water column; and once in place, the pipeline would not be expected to directly interact with Cook Inlet commercial fisheries.
Changes to Surface Water Temperatures and Chemistry Changes to surface water temperature and water chemistry in streams, Iliamna Lake, or Cook Inlet are not expected during construction and operations of the transportation and natural gas pipeline corridor. Potential water quality impacts are discussed in Section 4.18, Water and Sediment Quality.
Summary of Transportation and Natural Gas Pipeline Corridors Impacts— Applicant’s Preferred Alternative
Direct Effects In terms of magnitude and extent, the road and onshore pipeline corridors would directly impact about 13.5 acres of perennial stream habitat. There would be a permanent loss of aquatic habitat within the footprint of bridge piers on the Newhalen and Gibraltar rivers. Unimpaired passage of resident and anadromous fish may be temporarily interrupted, but would continue unimpeded after construction is complete. Construction of stream crossings would avoid spawning migration windows; and where necessary, diversion methods—including juvenile and adult fish passage facilities—may be employed under the guidance of the ADF&G. Habitat at the immediate location of culverts would be altered, but fish would continue to use the streams. The duration of habitat
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Page 42 of 188 PEBBLE PROJECT CHAPTER 4: ENVIRONMENTAL CONSEQUENCES PRELIMINARY FINAL ENVIRONMENTAL IMPACT STATEMENT disturbance from construction effects would be short-term and temporary, but would be expected to occur if the project is permitted and built. The magnitude, duration, and extent of direct impacts to Iliamna Lake aquatic habitat would include permanent loss of small amounts of littoral (shallow and shoreline habitat) at the Eagle Bay and south ferry terminals. Surveys indicate that the habitat lost receives limited use for rearing by juvenile Pacific salmon, and the immediate area of the terminals is not used for spawning by any species of Pacific salmon (Paradox 2018b). The combined loss of littoral zone habitat at the two terminals is minimal relative to the available littoral habitat that would remain undisturbed in Iliamna Lake. Riprap placed around the landing ramps would be colonized in the short-term, and subsequently used by fish and their prey organisms. Construction of the natural gas pipeline across Iliamna Lake would have both permanent and temporary direct effects on lake habitat. There would be permanent, direct mortality of any benthic organisms beneath the pipeline footprint on the bottom of Iliamna Lake. However, given the water depths, lack of light, and oligotrophic status of Iliamna Lake, impacts to deep-water benthic areas and invertebrates are not expected to be substantial, with recolonization expected in 1 to 2 years. The pipeline itself would provide a hard surface that would be colonized by benthic macroinvertebrates and algae. The Cook Inlet portion of the natural gas pipeline would temporarily impact 628 acres, including about 6.8 acres of weathervane scallop habitat. Long-term impacts would be expected for 11 acres of benthic marine habitat. An additional 21 acres of Cook Inlet marine benthic habitat would be temporarily impacted during construction from anchor and cable sweeps. It is expected that the pipeline itself would be quickly colonized by marine life, and soft substrate areas disturbed by construction would also recolonize. Direct displacement, injury, or mortality of fish could occur during construction of bridges, culverts, and the overland portions of the natural gas pipeline. Potential impacts on fish passage are not expected to occur at stream crossings, except temporarily during construction activities; the duration of impact would be that unimpaired passage of fish may be temporarily interrupted during construction activities at stream crossings, but would resume unimpeded after construction is complete. Mitigation measures described in Chapter 5, Mitigation, including the use of HDD, construction timing windows, culvert design and maintenance, and ADF&G permit stipulations would be expected to reduce the extent and severity of impacts to fish migration. The ferry terminals would be situated on beaches with no documented sockeye beach spawning habitat in the immediate vicinity; therefore, ferry operations would not be expected to directly impact adult sockeye salmon through propeller entrainment or injury, wake impacts, or due to noise and vibration from vessels. The short rock-and-gravel ramps required for the ice-breaking ferry at the Eagle Bay and south ferry terminals would not be expected to block fish passage or migration patterns in Iliamna Lake. Juvenile sockeye have the highest potential to interact with the ferry operations due to their relative abundance and wide distribution throughout the Iliamna Lake system. Marine fish would not be expected to suffer direct mortality or injury during pipe-laying operations in Cook Inlet, but could be temporarily displaced from the immediate vicinity of construction activity. The presence of 104 miles of natural gas pipeline would not be expected to impact fish passage or migration patterns in Cook Inlet, or to hinder marine macroinvertebrates (e.g., crabs). The diameter of the pipe resting on top of the sea floor would be within in the natural range of seafloor topography. There would be direct mortality of weathervane scallops due to pipeline construction. Weathervane scallops have limited ability to avoid the impacted area, which may result in weathervane scallop mortality. Because the impact area would be small compared to the
FEBRUARY 2020 PAGE | 4.24-37
Page 43 of 188 PEBBLE PROJECT CHAPTER 4: ENVIRONMENTAL CONSEQUENCES PRELIMINARY FINAL ENVIRONMENTAL IMPACT STATEMENT unaffected weathervane scallop range in Cook Inlet, and the estimated low number of potential injured or killed scallops, impacts would not be noticeable. Direct effects on surface water flows at stream crossings are not expected except temporarily during culvert installation, HDD, or trenching. Water withdrawals at lakes, ponds, and streams along the road corridor would be expected to temporarily affect streamflows. Water withdrawals from fish-bearing streams require authorization from ADNR and ADF&G so that water levels and resident fish in the targeted waterbodies would not be permanently affected. The magnitude and extent of potential impacts to groundwater and surface water during pipeline construction would involve interception of shallow groundwater and surface water during trenching activities, which would be captured and locally flow along the trench backfill. Fill placed in the nearshore zone to construct ramps at the north and south ferry terminal locations could modify water circulation patterns by changing the direction or velocity of water flow; alter the location, structure, and dynamics of aquatic communities, including prey; and alter shoreline and substrate erosion and deposition rates. Mitigation measures in Chapter 5, Mitigation, would reduce impacts to streamflow and lake circulation.
Indirect Effects In terms of magnitude and extent, the road/pipeline footprint and associated crossing structures would impact riparian vegetation and interrupt floodplain connectivity in certain locations. This could reduce the input of terrestrial nutrients, thereby affecting downstream productivity. The duration of the impact to riparian vegetation would be permanent, and would be expected to occur if the project is permitted and built. However, additional non-impacted riparian habitat is available throughout the watersheds, and BMPs and mitigation measures described in Chapter 5, Mitigation, would reduce impacts. Littoral habitat at the ferry terminals in Iliamna Lake would be lost due to construction of the ramps, but installed riprap and disturbed areas would be expected to recolonize. The aquatic food bed and overall productivity in the lake would not be expected to be impacted. In terms of magnitude, duration, extent, and likelihood, road construction, maintenance, and use can result in short- and long-term impacts to streams and drainages from increased surface erosion and deposition of fine sediments. As described in Chapter 2, Alternatives, operations are expected to require 35 truck round trips per day, which would result in dust impacts in proximity to roads, including at stream crossings. The increased water turbidity due to erosion and sedimentation and effects of dust generation are expected to be limited to bridge or culvert crossings, and mitigated by measures described in Chapter 5, Mitigation. Temporary turbidity and sedimentation impacts could occur from diverting rivers or streams, removing riparian vegetation, and excavating streambed materials during overland pipeline installation. Turbidity and sedimentation impacts would be temporary during construction, and short-term until riparian vegetation becomes re-established. In terms of magnitude, duration, extent, and likelihood, there would be local, short-term turbidity increases to the water column in Iliamna Lake that could indirectly affect fish and benthic organisms during construction of the ramps at the south and north ferry terminals; this turbidity and increased water column suspended sediments would not be expected to persist, or to cover a large geographic area. Pipeline construction activities in Iliamna Lake and Cook Inlet would be expected to have short- term impacts on individual fish and shellfish, but would not be expected to have population-level impacts, or to impact overall marine or lake productivity. In addition, changes to surface water temperature and water chemistry in streams, Iliamna Lake, or Cook Inlet are not expected during construction and operations of the transportation and natural gas pipeline corridor.
FEBRUARY 2020 PAGE | 4.24-38
Page 44 of 188 MEMORANDUM February 25, 2020 Phone: 250-4621 E-mail: [email protected] To: Lake and Peninsula Borough Assembly Nathan Hill, Manager
From: Bob Loeffler
Subject: Igiugig In-river Hydro and Pebble Permitting: No Effect
Summary. At the last Assembly meeting I was asked about the reference to Igiugig’s in-river hydro in the Pebble Preliminary Final Environmental Impact Statement (PFEIS). • Question: Will it affect the assessment of Pebble’s environmental consequence? Will it affect in any way Pebble’s permitting? • Answer: No. It will affect neither of these. It is mentioned in the PFEIS but has no effect on the assessment of Pebble’s environmental consequences or its permitting.
Detail. The EIS is required to review Reasonably Foreseeable Future Actions. According to the EIS, these are “existing plans, permit applications, and fiscal appropriations that are likely (or reasonably certain) to occur.1” The review is intended to illustrate whether events expected in the future will cumulatively – with Pebble – have an a direct or indirect effect on a specific resource such as hydrology, fish, or wildlife.
Chapter 4 of the PFEIS analyzes the environmental consequence of Pebble. The chapter includes a list of other activities that are likely to occur. Table 4-1-12 describes Igiugig’s in-river hydroproject: “The Igiugig Hydrokinetic Pilot Project is a proposed in-river 35kW RivGen Power system Turbine generator unit, 52-foot long, 12-foot high,47-foot wide place in the Kvichak River in roughly 16 feet of water 100 feet off the river bank near Igiugig. The facility would be anchored and connected with a series of power/data monitoring cables to a prefabricated shore facility. Igiugig Village Council proposes maintaining between 3.5 and 7 feet of water over the top of the device. Upon expiration of the license, the project would be removed, and the site restored.” The table concludes that the project is reasonably foreseeable in that it is expected to receive permits and be installed.
Later in the chapter, the PFEIS evaluates the potential effect of the in-river project on surface water hydrology. In doing so, it concludes that the project “is not expected to have any affect on surface water hydrology.3” Because the PFEIS concludes that it will have no effect on surface water hydrology, the document effectively concludes that it does not make Pebble’s environmental impacts any better or worse. Therefore, it will have no effect on Pebble's environmental impacts or permitting.
1 Page 4.1-5 2 Page 4.1-19 3 Table 4.16-8 on Page 4.16-58. The information is also summarized on page 50 of the Executive Summary.
Page 45 of 188 Page 46 of 188 Lake and Peninsula Borough P.O. Box 495 King Salmon, Alaska 99613
Telephone: (907) 246-3421 Fax: (907) 246-6602
Date: March 9, 2020
To: Mayor and Assembly
From: Danica Wilson, Community Development Coordinator
Re: CDC Report
Comprehensive Plan Update- We have a final draft of the comp plan update ready for the planning commission to review at their meeting later this month. I’ll be working on re- structuring the format of the comprehensive plan to simplify it for future updates. We’ve also planned for me to travel to 3-4 villages a year to meet with communities in person and gather information and pictures to prep for the next comp plan update.
COVID-19- I’ve been in contact with the State of Alaska Emergency Operations Center and Department of Health and Humans Services keeping up to date on the current Coronavirus situation. We have put together a press release and have been forwarding information to our communities as we receive it. The best place for up to date in formation on the Coronavirus situation is the Centers for Disease Control and Prevention website (www.cdc.gov).
Emergency Response Plan- We’ve signed a letter of commitment to start working on updating LPB’s Hazard Mitigation Plan with the Division of Homeland Security and Emergency Management in the near future. This will tie in nicely with developing an emergency response plan (ERP) and criteria for disasters in our borough. I’ve also been in touch with other planners around the state for advice on how to develop an ERP.
Kijik Land Sale- I’ve been working with both Michelle and Nathan on developing a letter of support regarding the Kijik land sale. We will have one drafted and ready to send to BIA today.
Planning- I have been working on updating LPB’s development permit and creating a subdivision/platting application to put on our new website. We have also been looking into options for developing an interactive map to add to our website. I’ve been in touch with a representative at InterDev who is helping with recommendations and the logistics of developing the type of map that we’re looking for. These conversations have made it apparent that an in-house GIS/mapping system would be beneficial to the Borough, especially the planning department. I’ve reached out to a representative at ESRI to discuss training options and what it will take to develop and manage this type of system.
Chignik Bay • Chignik Lagoon• Chignik Lake• Egegik • Igiugig• Iliamna • Ivanof Bay• Kokhanok• Levelock • Newhalen • Nondalton• Pedro Bay• Perryville• Pilot Point• Pope Vannoy• Port Alsworth• Port Heiden• Ugashik
Page 47 of 188 Page 48 of 188 Fishery Advisor Report Lake and Peninsula Borough | March 2020
Board of Fisheries Proposal 279 – Bristol Bay On a vote of 4 to 0 with 3 recusals, the Board passed proposal 279 to allow two Bristol Bay drift gillnet CFEC permit holders to fish concurrently from the same vessel and jointly operate up to 200 fathoms of drift gillnet gear when the Naknek River Special Harvest Area is open. The Nushagak Advisory Committee opposed this proposal and six public comments were in favor. The Nushagak AC argued that the proposal should wait until the next regular cycle. The Board found it compelling that enough new information had come out of the 2018 and 2019 seasons to warrant considering it out of cycle. Proposal 259 – Chignik Red King Crab Proposal 259 would create a new super-exclusive Chignik Registration Area for the commercial king crab fishery and provide for registration, seasons, size limits, lawful gear, pot storage requirements, inspection, and vessel length restrictions. The proposal failed 0-7, in part because no one expects to see a King crab opening in their lifetime. Proposal 260 – Chignik Tanner Crab There has not been a Tanner Crab fishery since 2012. Proposal 260 would give greater opportunities for a Chignik small boat fishery to participate if and when the fishery does open. The
Page 49 of 188 proposal asks that the boundary for the Tanner crab fishery match the Kupreanof Point to Kilokak Rocks boundaries of the Lake and Peninsula Borough, Chignik salmon, cod, rockfish, shrimp, and Dungeness crab. Currently, Chignik only has a small wedge shaped area and Kodiak can fish in the light grey “Semidi Island Overlap Area” when Chignik fishermen can’t. On a clear day you can see Sutwik Island from Chignik Bay. Sutwik Island is in the Semidi overlap area. It is galling to know that this area, traditionally Chignik waters, can be fished by Kodiak crab boats but not Chignik boats. The borough has ownership interest in the new Chignik dock and encourages the development of small boat fisheries for the local Chignik residents. Fishermen are frustrated because fishable amounts of crab are available but the department has been afraid of over fishing the crab because the fishable amounts are historically small. Proposal 260 would fold the Semidi Overlap Area into a super-exclusive Chignik Tanner Crab fishery. As written the proposal was strongly opposed by Kodiak stakeholders but they put forward a compromise to make the overlap area open to fishing to Kodiak and Chignik whenever Chignik or the Southwest Section of Kodiak District was open. While this was less than asked for it was judged to be politically achievable, and the compromise was accepted by the author of the proposal. The amended proposal passed 7 – 0. Now the department is rethinking its whole approach to fishing crab and is open to considering making smaller amounts available if the fishing pressure can be appropriately controlled. It is expected that next year at this same meeting that a whole new management plan may be up for consideration.
Fishery Disaster Update Chignik 2018 Sockeye Disaster The State is beginning to reach out to Chignik stakeholders on what the spending plan should be for the $10.3M that has been allocated to the 2018 Chignik sockeye disaster. It is likely that a significant portion will be set aside for research – perhaps 20% or more. It is still unclear how the State intends to conduct their outreach. It is recommended that the community leaders reach out to the State (ADF&G Headquarters) as a stakeholder and representative of Chignik stakeholders.
Calendar Mar 11-12. NMFS. Alaska Groundfish and Halibut Seabird Working Group, Juneau Mar 17-19. NPRB Science Panel Meeting Mar 30-Apr 7. NPFMC, Anchorage Apr 2-4. 2020 Western Alaska Interdisciplinary Science Conference and Forum, Dillingham Apr 8-9. NPRB Advisory Panel Apr 10. BOF 2020/2021 proposal deadline May 5. ASMI Board, Juneau May 11-14. IPHC Management Strategy Advisory Board, Seattle Jun 1-9. NPFMC, Juneau Jun 23-25. IPHC Scientific Review Board, Seattle Aug 13. BOF ACR deadline
Page 50 of 188 Lake and Peninsula Borough
March 2020 Finance Report
3/5/2020
To: Mayor Alsworth & Borough Assembly CC: Nathan Hill, Borough Manager
Revenue:
Revenue has reached 120% of the annual budget. That is a positive variance of $740,211.84. This will make up for the cut in debt reimbursement from the State of Alaska this fiscal year which is costing the borough $482,548.46 in unreimbursed bond payments. There is still over $350,000 in revenue that will is expected this year from Payment in Lieu of Development (PILD), Payment in Lieu of Taxes (PILT), Business Licensing, and SOA Shared Fishing Tax. The PILD Payment of $77,500 is received typically in May, PILT of $250,000-$300,000 arrives
Page 51 of 188 Lake and Peninsula Borough in June, and Shared Fish Tax normally arrives in March. Business Licenses are coming in on almost a daily basis at this time of the year.
Tax Revenue: The bulk of the tax revenue has been received for the fiscal year. There will be more trickling in from Bed Tax and Guide Tax for 4th Quarter. We will receive more in adjustments to the Raw Fish Tax filings as total dollar values are finalized and the fishermen are paid for their bonuses. As of February 29, 2020, the Borough has received over $2.6 Million (MM) in Raw Fish Tax. This is a positive variance of $892,857. Bed Tax and Guide tax are continuing to arrive. Those taxes have reached 96.7% of the annual budget as of the end of February.
The Investment Portfolio ended February with an interest income at 146% of budget and Market Gain/(Loss) on investments at a gain of $69,0082 or a gain of 230% of budget.
Expenses Expenses are on target for the year. Overall, Expenses are at 66% of the budget with 67% of the year being completed. There are quite a few expenses that are one-time expenses that have already been completed such as PERS Salary Floor Contribution, Auditor Expenses, Office Equipment, and Computer Hardware and Software. The Assembly Expenses are estimated to be under budget by 20% by year end due to the majority of meetings being conducted telephonically.
Page 52 of 188 LEGISLATIVE REPORT #20-03
House Moves to Approve FY 2021 Operating Budget • The Alaska House of Representatives remains on schedule to approve its version of the FY 2021 operating budget by early March. All Finance Subcommittees concluded closeouts by February 17. Four days of public testimony concluded on February 22. Amendments and final action by the full House Finance Committee is expected during the upcoming week.
• Highlights from the Finance Subcommittees include the following items:
• Nearly $19 million more for the Alaska Marine Highway System (AMHS), which restores about 50% of the FY 2020 budget cut (current year). While it’s not clear what this amount will fund, the intent is to eliminate the most severe disruptions in service particularly during winter months. • Rejected $10.5 million reduction of the proposed $25 million reduction for the University of Alaska. • Added $1 million for public broadcasting grants to radio stations. More adjustments are expected. • Denied governor’s proposal to send prisoners out-of-state. Restored funding to reopen Palmer Correctional Center. Added $1 million for VPSO grants,
• Issues raised during public testimony before the full House Finance Committee have covered a wide range of topics: support for more AMHS funding, early and forward funding of K-12 public education, public broadcasting, new revenue (income or state sales tax, increasing motor fuel taxes, oil and gas tax reform), support for University of Alaska and funding Medicaid programs.
AMHS Reshaping Work Group, Public Corporation Proposal • On February 19 Governor Dunleavy announced the names of the nine-member AMHS Reshaping Work Group. The role of this group is to make recommendations on the future finances and services level of the AMHS. Retired US Coast Guard Admiral Tom Barrett will chair this group.
• Recommendations are due by September 30, 2020, with the goal to begin implementation in FY 2023 (or starting July 1, 2022). The group consists of nine members, including two legislators (Senator Bert Stedman (R-Sitka) and Rep. Louise Stutes (R-Kodiak)), one union member and three public members.
• House Bill No. 249 was introduced this week by Rep. Stutes to establish a public corporation to manage the operations of the AMHS. The bill is modeled in part after the law establishing the Alaska Railroad Corporation. This proposal has been debated as an idea since the early 1980’s. An Issue Analysis I prepared in 1989 is one of the documents included in the bill package – much to my surprise. What I find of particular interest is that most of the challenges facing the System today were concerns then.
1 Mark Hickey February 23, 2020
Page 53 of 188 New Dunleavy PFD Payback Proposal • On February 19 Governor Dunleavy introduced new legislation to pay $1,304 to every eligible Alaskan (HB 259/SB 205) to make up the difference to comply with the statutory dividend formula for last year’s PFD (2019 dividend). More than $800 million would be needed from the Permanent Fund Earnings Reserve Account to pay for it. Legislators from both parties offered a lukewarm reception at best.
Governor Recall Effort Developments • Efforts to recall Governor Dunleavy gained momentum this week with a ruling by the Alaska Supreme Court to allow the campaign in favor to begin collecting signatures. Although a final ruling may stop the process, the Court’s order stated that to stop signature gathering the Stand Tall with Mike group needed to show that it would likely win its appeal of the Superior Court decision in favor of the recall proceeding but failed to do so. Following this ruling, the Stand Tall with Mike group withdrew from the court case, leaving the state challenging this effort.
Other Capitol News • The governor’s proposal to establish the Alaska State Lottery Corporation was introduced this week. The new entity would decide what specific games to offer but could include Powerball, scratch-off games and video lottery terminals. Revenue estimates range from $25 million to more than $100 million annually once the lottery is up and running. Proceeds would be deposit in a special fund with the its purpose to be decided.
• Smaller revenue measures are gaining some traction this year. Senate Bill No. 115 by Senator Click Bishop (R-Fairbanks) to double the state’s motor fuel and watercraft fuel taxes passed out of the Senate Finance Committee this week. This measure could generate about $35 million per year in additional revenue. Other measures receiving consideration include Senator Bishop’s proposal to reestablish the education head tax (SB 50) and a bill by Senator Gary Stevens (R-Kodiak) to add e-cigarettes to the state’s tax on other tobacco products (SB 182).
• Another bill gaining attention is House Bill No. 221 by Rep. Chuck Kopp (R-Anchorage) to provide state recognition of federally recognized tribes. There are currently 229 federally recognized tribes in Alaska. The measure moved out of the House Special Committee on Tribal Affairs this week and is scheduled next week for a hearing in the House Community & Regional Affairs Committee. The implications of this measure are viewed as sending an important, but largely symbolic message.
• On February 21 Governor Dunleavy introduced a measure to establish the PFD Land Voucher program. The bill allows any eligible PFD recipient to take a voucher in lieu of the traditional PFD to use for the purchase of state land. The vouchers will be worth twice the monetary value of the statutory PFD calculation for that year. Vouchers do not expire, can be transferred, and can be used in combination with the veterans’ land purchase program or separately toward a land purchase.
2 Mark Hickey February 23, 2020
Page 54 of 188 Summary of State Legislation
Below is a list of legislative measures of interest, divided into five main topics: fiscal measures, general municipal issues, education measures, fishery & resource issues, and energy matters. House measures are described first, followed by Senate measures. Companion bills (measures in both bodies) are listed together, with priority given to bills sponsored by majority members. More information about these measures can be found at Alaska State Legislature.
Check out what your legislators are doing in Juneau! New bills are in BLUE, change in status in RED, and passed bills in GREEN.
Fiscal Measures
Measure Summary Status HJR 1 by Proposes a constitutional amendment to prohibit a HJR 1 pending House Rauscher broad-based individual income or statewide sales State Affairs tax without the approval of the voters in Alaska.
HJR 3 by Tuck Proposes a constitutional amendment to enshrine HJR 3 pending House dividend in the constitution and require use of State Affairs “prudent investor rule” for Permanent Fund corpus.
HJR 15 by Proposes a constitutional amendment to make veto HJR 15 passed House Josephson overrides for all governor actions subject to a two- Judiciary 2/10, pending SJR 14 by Senate thirds vote of the membership of the legislature. House Finance Judiciary Includes any bills to raise revenue or appropriations. SJR 14 scheduled Senate State Affairs 2/25 HJR 16 by Tuck Proposes a constitutional amendment to establish a HJR 16 pending House biennial state budget. State Affairs
HJR 18 by Kreiss- Proposes a constitutional amendment consolidating HJR 18 pending House Tomkins the Permanent Fund into a single account, thereby Judiciary eliminating the earnings reserve account. Sets the POMV draw from the Permanent Fund to no more than 5% of the Fund’s market value.
HJR 22 by Kreiss- Proposes constitutional amendment to repeal HJR 22 pending House Tompkins requirement to repay funds to the CBR fund. State Affairs
HB 132 by Wool Ties value of future PFD’s directly to the price and HB 132 pending House production of oil and its revenues. Reserves POMV Finance draw for state services. Eliminates mandatory inflation-proofing.
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Page 55 of 188 Measure Summary Status HB 141 by Kreiss- Changes the PFD from an annual disbursement to HB 141 pending House Tomkins quarterly payments for all eligible individuals. State Affairs . HB 239 by Establishes a state lottery and provides for HB 239 scheduled House Thompson participation in multi-state lotteries. Establishes a State Affairs 2/25 state lottery board.
HB 246 by Establishes the Alaska Lottery Corporation to HB 246 referred House governor oversee new state lottery. Corporation decides State Affairs, Finance SB 188 by what games to offer. Potential revenue estimated to SB 188 referred Senate governor range from $25 to $100 million per year. State Affairs, Finance
HB 259 by Provides an additional 2019 PFD payment of $1,304 HB 259 referred to House governor to every individual who received a 2019 PFD and is Finance SB 205 by eligible for a 2020 PFD. SB 205 referred to Senate governor Finance
SJR 1 by Proposes a constitutional amendment to guarantee SJR 1 pending Senate Wielechowski a Permanent Fund (PF) dividend using a Percent of State Affairs Market Value (POMV) method.
SJR 2 by Begich Proposes a constitutional amendment for annual SJR 2 pending Senate dividends and to support state services. Sets draw State Affairs at 5% of POMV, with 40% for dividends, 40% for services and 20% for inflation-proofing.
SJR 4 by Proposing a constitutional amendment requiring the SJR 4 pending Senate governor vote of the people for new taxes or an increase to Finance HJR 5 by existing taxes. HJR 5 pending House governor State Affairs SJR 5 by Proposing a constitutional amendment to enshrine SJR 5 pending Senate governor the PF dividend formula in the Constitution. Finance HJR 6 by Requires subsequent vote of the people to change HJR 6 pending House governor the program in the future. State Affairs
SJR 6 by Proposing a constitutional amendment that creates SJR 6 pending Senate governor a new spending cap that permits minimal increases Finance HJR 7 by based on population and 50% of inflation. HJR 7 pending House governor State Affairs
SB 14 by Repeals per barrel oil tax credit. May generate SB 14 pending Senate Wielechowski between $1 to $1.5 billion annually. Resources
SB 17 by Proposes a special appropriation of $2.39 billion to SB 17 pending Senate Wielechowski pay supplemental PF dividends. State Affairs
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Page 56 of 188 Measure Summary Status SB 23 by Funds back payment of PF dividends for years SB 23 pending Senate governor 2016, 2017 & 2018. Amounts range from $1,100 to Finance HB 46 by $1,300 per year. Payment spread over three years. HB 46 pending House governor Passage is contingent on enactment of SB 24. State Affairs
SB 24 by Sets eligibility requirement for recipients of back SB 24 pending Senate governor payment for PF dividends. Must be eligible both in Finance HB 47 by current year and the previous year HB 47 pending House governor State Affairs
SB 50 by Bishop Establishes an annual employment tax of $30 on SB 50 scheduled Senate wages and net earnings from self-employment. Finance 2/28 Permits use of proceeds to fund education facilities.
SB 92 by D. Expands the permanent fund dividend application to SB 92 pending Senate Wilson allow an applicant to direct all or a part of their PFD Finance to the general fund.
SB 103 by Senate Amends use of Earning Reserve POMV draw SB 103 pending Senate Finance splitting it 50/50 between Permanent Fund Rules dividends and use for government services. Limits annual POMV draw to 5%.
SB 104 by Senate Proposes new statutory spending limit formula of $5 SB 104 scheduled Senate Finance billion annually in unrestricted general funds. Finance 2/21 (cancelled) HB 131 by House Provision included for inflation adjustments and HB 131 pending House Finance disasters. Finance
SB 115 by Bishop Increases motor fuel tax from 8 cents to 16 cents a SB 115 passed Senate gallon and the tax on all watercraft motor fuel from 5 Finance 2/21 cents to 10 cents a gallon.
SB 129 by Omnibus bill to amend oil and gas production taxes, SB 129 pending Senate Wielechowski reversing many of the changes adopted under SB Resources 21 passed in 2014.
SB 152 by FY 2021 Operating Budget: Proposes status quo SB 152 pending Senate governor budget compared to FY 2020 budget with a few Finance HB 205 by additions reversing cuts. Provides flat funding for K- HB 205 scheduled House governor 12 but doesn’t include the $30 million in one-time Finance 2/24 -2/29 for money provided in current year. School debt amendments, final action reimbursement funded at 50%. $28 million deposit proposed for Community Assistance fund
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Page 57 of 188 Measure Summary Status SB 174 by FY 20 supplemental appropriations bill: Requests SB 174 scheduled Senate governor $262.5 million for wildfire suppression, Medicaid Finance 2/27 HB 234 by requirements, AMHS operations and vessel repairs HB 234 heard & held governor and miscellaneous costs. House Finance 2/21, scheduled 2/24
General Municipal Issues
Measure Summary Status HJR 2 by Claman Proposes constitutional amendment to limit regular HJR 2 pending House legislative sessions to ninety days. State Affairs
HB 2 by Rauscher Proposes relocation of the legislature and regular HB 2 pending House legislative sessions to Anchorage. C&RA
HB 17 by Rauscher Repeals the certificate of need (CON) program for HB 17 pending House SB 1 by Wilson health care facilities. H&SS SB 1 pending Senate FIN
HB 25 by Sullivan- Amends definition of “peace officers” to include HB 25 pending House Leonard employees of a private police organization and C&RA places such groups under regulation by the Alaska Police Standards Council.
HB 43 by Exempts state from observing daylight savings HB 43 pending House Rauscher time. Requires petition to U.S. Dept. of State Affairs Transportation to place Alaska in all or part of the Pacific Standard Time zone.
HB 76 by Adopts the 2018 International Residential Code as HB 76 pending House Rasmussen the state residential code. If a municipality has its C&RA own construction code, it has to meet or exceed the state code within two years.
HB 79 by Kopp Allows firefighters and peace officers to join a HB 79 pending House defined benefit retirement plan. Establishes Finance medical benefits eligibility requirements and payment for past service provisions.
6 Mark Hickey February 23, 2020
Page 58 of 188 Measure Summary Status HB 81 by Prohibits use of disposable plastic shopping bags HB 81 pending House Josephson and provides for an administrative fine against a Labor & Commerce retail seller who is in violation.
HB 82 by Expands duties of State Commission for Human HB 82 pending House Josephson Rights with new provisions prohibiting Judiciary SB 82 by discrimination based on sexual orientation or SB 82 pending Senate Kawasaki gender identity. Applies to political subdivisions. State Affairs
HB 83 by Kreiss- Prohibits return of absentee ballots by fax to the HB 83 passed House Tomkins Division of Elections. 2/12, referred Senate STA
HB 84 by Expands coverage to include emergency medical HB 84 scheduled House Josephson technicians, paramedics, and peace officers when it Labor & Commerce 2/24, comes to the presumption of compensability for a 2/26, 2/28 disability resulting from certain diseases.
HB 106 by T. Extends moratorium on school bond debt HB 106 heard & held Wilson reimbursement program until July 1, 2025. Senate Finance 2/14
HB 107 by Allows a first class or home rule city to petition the HB107 pending H. C&RA Sullivan-Leonard ABC Board to authorize and regulate alcoholic SB 96 pending Senate SB 96 by D. beverage licenses for a municipal restaurant or Labor & Commerce Wilson eating-place or a municipal package store.
HB 110 by Establishes authority to transfer a boat or vehicle HB 110 pending House Spohnholz title on death of the owner to a designated Judiciary beneficiary.
HB 115 by Tuck Allows voters to receive absentee ballots by mail for HB 115 passed House SB 105 by future state elections for a four-year period, versus 2/12, referred Senate STA Kawasaki having to reapply each election cycle. SB 105 pending Senate STA HB 142 by Kreiss- Authorizes Alaska Native entities to appoint, train, HB 142 passed House Tomkins supervise and retain village public safety officers 2/7, referred Senate (VPSO). C&RA
HB 145 by House Omnibus crime bill providing increased sentencing HB 145 pending House Judiciary ranges, stronger penalties for drug dealers, Judiciary additional tools to prosecute theft, and closes sex offense and offender registration loopholes. HB 187 by Fields Prohibits prisoners from being sent out of state with HB 187 pending House SB 138 by Gray- narrow exceptions related to medial treatment Finance Jackson needs. Prohibits use of a private facility within SB 138 pending Senate Alaska. State Affairs
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Page 59 of 188 Measure Summary Status HB 200 by Tarr Known as the Wage Disclosure Act, employers HB 200 pending House cannot use an applicant’s past wages/benefits for State Affairs determining future wages/benefits. Adds other provisions to counter gender-based wage discrimination. HB 221 by Kopp Requires state recognition of Alaska’s 229 federally Moved from House TRB, recognized tribes. scheduled House C&RA 2/27 HB 229 by Creates the Alaska Health Care Transformation HB 229 heard & held Spohnholz Corporation with intent to provide more trans- House L&C 2/21 SB 201 by Von parency to see providers’ health care charges. SB 201 referred Senate Imhof Includes a municipal seat on board. L&C, Finance
HB 232 by Allows certain municipalities to provide a property HB 232 passed House Hopkins tax credit for air quality improvements and energy Energy 2/20, scheduled SB 175 by Bishop efficient new construction. House L&C 2/26 SB 175 referred to Senate C&RA HB 249 by Stutes Establishes the Alaska Marine Highway System HB 249 referred to House Corporation to manage AMHS using a seven- TRA, Labor & Commerce, member board. It provides transitional language heard & held House TRA throughout the statutes to effect this change. 2/20 HB 253 by Kreiss- Prohibits the selling, transfer, or otherwise disposal HB 253 referred to House Tomkins of a state-owned ferry without legislative approval. TRA, State Affairs, scheduled TRA 2/25 HB 262 by Sets the date of regular municipal elections is the HB 262 referred House Rasmussen first Tuesday of October or November. Eliminates C&RA, State Affairs option to use a different month (such as what Anchorage has done).
HB 268 by LeBon Prohibits the Alaska Municipal Bond Bank Authority HB 268 referred House from assisting the University of Alaska (UA) to fund Finance heating or energy projects. Increases bonding amounts for other UA or regional health entity projects. SB 5 by Stevens Requires Permanent Fund Corporation to manage SB 5 pending Senate certain municipal investment assets if requested. C&RA
SB 45 by Shower Authorizes a municipality or Regional Educational SB 45 pending Senate Attendance Area (REAA) to impose term limits on Education school board members. Requires a vote of qualified voters for REAAs. SB 46 by Kiehl Allows teachers and other public employees a SB 46 pending Senate choice between a defined benefit pension versus C&RA the current defined contribution 401(k) plan. Same bill introduced in previous legislatures.
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Page 60 of 188 Measure Summary Status SB 52 by Micciche Omnibus bill relating to the manufacture, distri- SB 52 passed Senate bution, bartering, licensing, possession and the sale Finance 2/19, referred of alcoholic beverages in Alaska. Provides that Rules only the ABC Board may issue, renew, transfer, relocate, suspend or revoke a license under Title 4.
SB 57 by governor Repeals ability of municipalities to levy tax on oil SB 57 pending Senate HB 59 by governor and gas exploration, production, and pipeline C&RA property. Excludes value in determining required HB 59 pending House local contribution for education. Resources
SB 58 by governor Repeals the Senior Benefits Program on June 30, SB 58 pending Senate HB 60 by governor 2019. Currently, program expires on June 30, 2024. H&SS HB 60 pending House C&RA SB 59 by governor Repeals statutes requiring state reimbursement of SB 59 pending Senate HB 61 by governor debt for various programs, including certain port Finance and harbor and power projects. Impacts Kodiak HB 61 pending House Electric, Aleutians East and Lake and Peninsula Education Boroughs.
SB 62 by governor Permits the legislature to appropriate half of the SB 62 pending Senate HB 64 by governor proceeds from the Alcoholic Beverage Excise Tax C&RA to be directed for Community Assistance program. HB 64 pending House H&SS SB 63 by governor Repeals the statutes that provide revenue sharing SB 63 pending Senate HB 65 by governor to municipalities from the Fisheries Business Tax C&RA and the Fishery Resource Landing Tax. HB 65 pending House Fisheries SB 64 by governor Repeals all statutory authority that requires state SB 64 pending Senate HB 66 by governor aid to municipalities for reimbursement of school Finance construction bonded debt. HB 66 pending House C&RA SB 67 by governor Repeals the Alaska Public Broadcasting Com- SB 67 pending Senate HB 69 by governor mission as of June 30, 2019, transferring its assets State Affairs to Alaska non-profit public broadcasting entities. HB 69 pending House C&RA SB 102 by Allows employers to adopt a retirement incentive SB 102 pending Senate Kawasaki program (RIP) for both TRS and PERS members of State Affairs a defined benefit plan.
SB 107 by Gray- Expands state law to include emergency medical SB 107 pending Senate Jackson technicians, paramedics, and a peace officer so Labor & Commerce that a presumption exists for a claim regarding disability compensation.
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Page 61 of 188 Measure Summary Status SB 110 by Removes funding mechanism from Community SB 110 pending Senate governor Assistance Fund. Repeals the following funds: Civil C&RA HB 130 by Legal Services, PCE Endowment, PCE and Rural HB 130 pending House governor Electric Cap., Curriculum Improvement and Best Energy Practices, and the Alaska Higher Education Investment Fund.
SB 128 by Prohibits Dept. of Transportation & Public Facilities SB 128 pending Senate Costello from increasing any fees or imposing new charges Transportation related to aviation unless they first obtain legislative approval.
SB 135 by Hughes Provides enhanced access to payment information SB 135 pending Senate from health care insurers, incentive programs and Labor & Commerce out-of-network providers. Preempts municipalities from regulating disclosure or reporting of such information.
SB 157 by Authorizes 6-month temporary licensing for over SB 157 pending Senate governor 100 professions. Repeals registration of other Labor & Commerce HB 216 by types of businesses. HB 216 pending House governor Labor & Commerce
SB 218 by Coghill Allows for consolidation of road service areas SB 218 referred Senate without voter approval if two or more service area C&RA boards request consolidation for the purpose of creating a single new service area that includes all parcels from both areas and no additional parcels.
Penguin “State of the State”
10 Mark Hickey February 23, 2020
Page 62 of 188 Education Measure
Measure Summary Status HJR 17 by Kopp Urges Congress to repeal federal law prohibiting HJR 17 pending House Indian Self-Determination and Education Tribal Affairs Assistance funds for use by tribes for education.
HB 11 by Rauscher Allows current or former state troopers to elect HB 11 pending House participation in a defined benefit retirement plan. Labor & Commerce Does not apply to teachers, other law enforcement or other public employees. HB 24 by Kreiss- Expands scope of teacher certificates for teachers HB 24 scheduled House Tompkins fluent in an Alaska Native or foreign language L&C 2/28 SB 203 by Olson initially for a one-year period. SB 203 referred Senate EDC, L&C HB 67 by governor Adds responsibility to Department of Labor & HB 67 pending House SB 65 by governor Workforce Development to coordinate and monitor Education state career and technical education programs with SB 65 pending Senate DEED, UA and others. Finance
HB 75 by HB 75 expands download requirements and HB 75 pending House Rasmussen funding options for Internet services for school Finance SB 74 by Hoffman districts. SB 74 contains funding piece only. SB 74 passed House Finance 2/13 SSHB 108 by Establishes a required K through 3rd grade reading HB 108 pending House LeDoux program in all schools or districts. Specifies Education mandatory student retention in grade 3.
HB 109 by LeDoux Amends school count requirements for K-12 HB 109 scheduled Senate foundation formula to include military dependents State Affairs 2/25 recently transferred or expected.
HB 128 by Kreiss- Sets goal that by 2025 at least 4% of public school HB 128 pending House Tomkins teachers will achieve national board certification. C&RA SB 113 by Hughes Requires schools display the name of teachers SB 113 pending Senate who have achieved this certification. Education HB 136 by Hopkins Requires school districts to allocate .5% of state HB 136 scheduled House aid to social and emotional learning. Education 2/28
HB 155 by Story Makes career/technical education work eligible for HB 155 scheduled House Alaska performance scholarship program. Education 2/28
HB 181 by Claman Directs Board of Education and Early Development HB 181 scheduled House SB 197 by to develop guidelines for instruction in mental Education 2/28 Gray-Jackson health in consultation with the HSS department. SB 197 referred Senate EDC, Finance
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Page 63 of 188 Measure Summary Status HB 188 by Fields Clarifies that cash or equipment contributions can HB 188 pending House be accepted for a range of childcare and similar Education facilities as a credit against any lawful tax.
HB 196 by Fields Specifies that first award for Alaska Performance HB 196 pending House Scholarships will be an amount equal to the Education average cost of resident tuition at the U of A.
HB 236 by Story Increases the Base Student Allocation (BSA) by HB 236 scheduled House $115 in FY 2021 and another $110 in FY 2022. Education 2/26 Translates into a total increase of over $50 million in K-12 funding by second year.
HB 237 by Story Proposes special appropriations of $20 million as HB 237 pending House grants to school districts for early literacy programs Education over next two fiscal years.
HB 254 by Replaces the Professional Teaching Practices HB 254 referred House Johnston Commission with the Alaska Educator Standards EDC, Finance Commission. Mandates additional training requirements for teacher certifications.
HB 256 by Hopkins Creates a Teacher Workforce Enhancement HB 256 referred House Program to address the growing shortage of EDC, Labor & Commerce teachers in the state.
HB 260 by Tarr Adds the principles of early childhood and youth HB 260 referred House brain development to the state’s education EDC, HSS, scheduled policy requirements under Title 14. House EDC 2/28
HB 269 by Hopkins Requires larger school districts to give teachers HB 269 referred House who are nursing mothers’ reasonable breaks and EDC, Labor & Commerce a location to express breast milk.
SJR 9 by Costello Proposes constitutional amendment requiring SJR 9 pending Senate governor to submit separate K-12 funding bill and Finance legislative approval by 45th day of session. Amended to require forward funding.
SSSB 6 by Begich Proposes statewide K-3 reading program and CSSB 6 passed Senate expands pre-K program for 4 & 5-year olds. EDU 2/14, scheduled Retention at grade 3 likely unless exempt by Senate Finance 2/26 school board. Senate Education CS adds annual review panel with teachers and a teacher retention task force.
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Page 64 of 188 Measure Summary Status SB 30 by Stevens Establishes new middle college program for public SB 30 pending Senate school students at the University of Alaska. This Finance bill was rolled into SB 114.
SB 31 by Stevens Requires establishment of a foundational SB 31 pending Senate curriculum for first year of lower division courses to Education ensure more transferability of credits between programs at the University of Alaska.
SB 53 by Stevens Requires biennial report to the legislature SB 53 pending Senate regarding accreditation status of the University of Finance Alaska. This bill was rolled into SB 114.
SB 56 by Costello Amends state law to require school districts to SB 56 pending Senate HB 70 by provide physical education. Education Rasmussen HB 70 pending House C&RA SB 79 by Hughes Requires DEED to establish a virtual education SB 79 pending Senate consortium, provides for more stringent standards Education for Praxis tests, and expands reporting of school district and employee’s performance. Most portions of this bill rolled into SB 114.
SB 114 by Senate Omnibus education bill combining HB 108 (Read SB 114 pending Senate Education By 9) without mandatory retention, SB 30, SB 53, Education most portions of SB 79 and creates a virtual education consortium task force.
SB 126 by Shower Mandates consolidation of school districts, SB 126 pending Senate HB 194 by Vance reducing number from 54 to 18. Includes REAAs. Education HB 194 pending House C&RA
SB 127 by Shower Requires conversion of 9 community colleges SB 127 pending Senate across the state to “virtual learning centers” & Education “higher education portals” by June 30, 2023.
SB 136 by Stevens Allows establishment of public schools through SB 136 scheduled Senate state-tribal compacts. Provides authority for Education 2/27 creation of a state-tribal compact school and defines scope and other requirements.
SB 142 by Begich Mandates the reporting of radiofrequency radiation SB 142 pending Senate exposure in schools by the HSS department to Education DEED.
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Page 65 of 188 Measure Summary Status SB 149 by Costello Requires every public high school to begin each SB 149 heard & held session at 8:30 a.m. or later. Senate Education 2/20
SB 151 by Referred to as the “Alaska Reads Act”, bill creates SB 151 pending Senate governor a statewide K-3 reading policy and program. Education HB 204 by Program includes early education grants, literacy HB 204 pending House governor and reading intervention. Specifies mandatory Education student retention in grade 3. Expands pre-K program for 4 and 5-year olds similar to Begich proposal in SB 6.
SB 211 by Costello Provides an annual bonus of at least $10,000 a SB 211 referred Senate year for a national board certificated teacher EDC, Finance employed as a classroom teacher in a public school.
Fishery & Resources Issues
Measure Summary Status HB 19 by Knopp Exempts some water taxi operators from regulation HB 19 pending House as transportation services by the Big Game Transportation Commercial Services Board.
HB 35 by Stutes Allows members of the Board of Game or Fisheries HB 35 pending Senate to deliberate and participate on certain matters even State Affairs if they or an immediate family member have a personal or financial interest.
HB 74 by Repeals the Ocean Rangers Program providing HB 74 heard & held governor observers onboard large commercial vessels to House Finance 2/11, 2/18 SB 70 by monitor compliance with marine discharge and SB 70 heard & held governor pollution laws. Senate Resources 2/17
HB 116 by Story Clarifies statutes to streamline renewal or extension HB 116 pending Senate of aquatic farming and hatchery site leases. Finance
HB 117 by Authorizes municipalities to regulate trapping for the HB 117 pending House Josephson limited purpose of preventing injury to persons or Resources property.
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Page 66 of 188 Measure Summary Status HB 137 by Tuck Requires use of permit system to limit the taking of HB 137 heard & held big game by nonresidents whenever restrictions are House Resources 2/21 needed for residents.
HB 138 by Kopp Clarifies that the process for classifying water HB 138 schedule House bodies as Outstanding National Resource Waters Resources 2/24 (ONRW) rests with the legislature. HB 185 by Stutes Exempts certain commercial vessels that have a HB 185 heard & held SB 145 by valid license under AS 16.05 from the numbering House TRA 2/13 Micciche and registration provisions of AS 05.25. SB 145 scheduled Senate Resources 2/24 HB 199 by Establishes a fisheries rehabilitation permitting HB 199 scheduled House Talerico process and specifies what an applicant must Fisheries 2/25 provide to DF&G.
HB 203 by Knopp Removes transport restrictions on the transportation HB 203 passed House of live King, Dungeness and Tanner crab species Resources 2/21, pending taken commercially. House Rules
HB 231 by Vance Allows for the display of fishing, hunting and HB 231 pending House trapping licenses on electronic devices. Resources
HB 252 by Tuck Proposes new “mentoring” program for limited entry HB 252 referred House permit holders allowing a second name to be added Fisheries, Resources subject to certain restrictions. Provides unlimited emergency transfer authority for a surviving spouse.
HB 258 by Gives the Dept. of Natural Resources (DNR) sole HB 258 referred House governor platting authority over state-owned lands regardless Resources, Finance SB 204 by of location. Other provisions relate to leasing and SB 204 referred Senate governor sale of state lands and repeals establishment of Resources, Finance recreational rivers and corridors.
HB 270 by Establishes state land vouchers in lieu of a PFD that HB 270 referred House governor can be used to purchase state land. Value would Resources, Finance SB 217 by be set at twice the monetary value of that year’s SB 217 referred Senate governor statutory PFD calculation. Vouchers do not expire Resources, Finance and can be sold.
SB 22 by Stevens Relates to management of enhances stocks of SB 22 pending Senate HB 41 by Ortiz shellfish, authorizes certain nonprofits to engage in Finance shellfish enhancement projects, and increases HB 41 pending Senate salmon hatchery permit fees from $100 to $1000. Finance
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Page 67 of 188 Measure Summary Status SB 87 by Coghill Mandates use of permit system limitations on taking SB 87 pending Senate of big game by nonresidents whenever state Resources residents face sustained yield restrictions. SB 90 by Micciche Establishes Cook Inlet buy-back program for set net SB 90 pending Senate entry permits and provides for a vote by permit Finance holders whether to be included. Broadens CFEC authority to establish management areas.
SB 99 by Requires the Board of Fish to place restrictions on SB 99 pending Senate Kawasaki all other fisheries before restricting personal use Resources fisheries except when the harvest of a stock or species is limited to achieve a management goal. SB 130 by Add pollock and cod to the product development tax SB 130 pending Senate Stevens credit up to 50% of the taxpayer’s tax liability. Resources Extends date to take credit for property first placed into service by Dec. 31, 2025.
SB 150 by Revak Repeals the termination date for the intensive SB 150 scheduled Senate HB 230 by Lincoln management hunting license surcharge. Resources 2/24 HB 230 pending House Finance
SB 214 by Kiehl Authorizes issuance of a permanent identification SB 214 referred Senate card for fishing, hunting, or trapping to an individual Resources, Finance honorably discharged from military service who incurred a 50% or greater disability during such service.
A new dawn for AMHS?
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Page 68 of 188 Energy Matters
Measure Summary Status HJR 26 by Tuck A resolution that urges Alaska’s delegation in HJR 26 referred to House Congress to implement and support a renewable Energy energy testing program in the state.
HB 32 by Kreiss- Makes federally recognized tribes and non-profits HB 32 pending House Tompkins eligible for loans from the Alaska energy efficiency Rules revolving loan fund.
SB 48 by Begich Adds goal to the state energy policy that at least 50 SB 48 pending Senate percent of the energy used by the state be obtained C&RA from clean energy sources by 2025.
SB 49 by Begich Sets goal to spend $100 million to retrofit public SB 49 pending Senate facilities and schools by 2025 and adds public C&RA schools to energy audit program.
SB 143 by Begich Allows a utility providing natural gas or electrical SB 143 pending Senate service to install a smart meter. Utilities must send Labor & Commerce the customer a written notice first. Customer can elect not to have a smart meter installed.
SB 194 by Senate Adds advanced nuclear reactors to the list of other SB 194 referred Senate C&RA nuclear facilities requiring a DEC permit to allow C&RA, Resources construction in Alaska.
SB 207 by Establishes the Electric Vehicle Infrastructure Fund SB 207 referred Senate Wielechowski within the Dept. of Commerce, Community & L&C, Finance Economic Development for the purpose of grants and loans.
SB 208 by Appropriates the balance of the Alaska Capstone SB 208 referred Senate Wielechowski Avionics revolving loan fund to the Electric Vehicle L&C, Finance Infrastructure Fund.
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Page 69 of 188 Page 70 of 188 LEGISLATIVE REPORT #20-04
House Approves FY 2021 Operating Budget in Record Time • The Alaska House of Representatives passed its version of the FY 2021 operating budget on March 3, apparently the earliest an operating budget was passed by the House since 1993. Little changes occurred on the House floor. The vote split along caucus lines.
• Total general fund spending on those items controlled by the legislature is $4.45 billion, or about $9.7 million more than what the governor proposed. The bill does not include money for the 2020 Permanent Fund dividend. House members expect to address the PFD in a different appropriations bill.
• Highlights from the approved House version of the FY 2021 operating budget include the following items:
• An increase of nearly $19 million more for the Alaska Marine Highway System (AMHS), restoring about 50% of the FY 2020 budget cut (current year). Details on what this amount will fund remain elusive, but the intent is to eliminate or reduce the most severe disruptions in service particularly during winter months for PWS and Kodiak. • Full funding of K-12 public education at the same level for FY 2020. This does not include forward funding for FY 2022 or the one-time $30 million provided this year. • Municipal school debt reimbursement is funded at 50%. Harbor debt reimbursement under AS 29.60.700 funded at 100%. • $30 million deposit into the Community Assistance Fund included to increase FY 2022 amount, but nothing added to increase FY 2021 distribution from $20 to $30 million. • Accepted the proposed $25 million reduction for the University of Alaska agreed to by the governor and Board of Regents last August. • Added $1 million for public broadcasting grants to radio stations. An attempt to add more money failed in the full House Finance Committee. • Denied governor’s proposal to send prisoners out-of-state but increased budget by $27.6 million to address prison population increases. Restored funding to reopen Palmer Correctional Center. • Added $1 million for VPSO grants.
• Action now moves to the Senate, which has begun Finance Subcommittee work.
Motor Fuel Tax Bill Passes the Senate • Senate Bill No. 115 by Senator Click Bishop (R-Fairbanks) passed the Senate on March 3 by a vote of 12 to 5. The bill increases the state’s tax on motor fuel by 8.95 to 16.95 cents per gallon and on watercraft motor fuel from 5 to 10 cents per gallon. All aviation fuel taxes are unchanged.
• The bill is scheduled for two hearings during the upcoming week in the House Transportation Committee. The bill would move to the House Finance Committee next.
1 Mark Hickey March 8, 2020
Page 71 of 188 Alaska Permanent Fund Board Worries About Fund’s Future • On March 5 the Alaska Permanent Fund (APF) Board voted to recommend choosing one of two proposals to reform its structure, with the intent to avoid what they called a 50% chance of “catastrophic fiscal failure” within the next twenty years. The current structure of splitting the fund between the corpus and Earnings Reserve Account (ERA) means the state may not have any funds in the ERA in a given year following bad market performance in preced- ing years. The result would be no funding for essential services or the PFD in that year.
• The first suggestion is to blend the two accounts into a single fund and limit the annual use from the APF based on the funds long-term real rate of return (or no more than 5% annually). The other idea is to keep the ERA but require a reserve large enough to absorb stock market impacts and the annual needs of the state (4X the annual state draw which is running around $3 billion). These actions could be adopted through a constitutional amendment or possibly through laws passed by the legislature.
• Some state lawmakers support further transfers from the ERA into the corpus to remove the temptation to spend these funds in any given year. $4 billion was moved into the corpus in last year’s budget. After this year’s draw of $3.1 billion to fund services and some level of a PFD, the balance in the ERA will be about $10 billion. This level is below the recommended size of reserve suggested in the second proposal.
Other Capitol News • On March 2 the Alaska Marine Highway System (AMHS) released the 2020 AMHS summer schedule and announced it is open for booking. Service to Kodiak restarts on April 25 and continues through September. Travel will be on the M/V Tustumena mostly, with periodic M/V Kennicott trips. There are 5 trips down the Alaska Peninsula and the Aleutian Chain, with the first trip scheduled for May 6 through May 12. The other four trips will be once a month with the last trip scheduled for September 8 through 15.
• The State of Alaska continues preparations to handle impacts from the coronavirus. There are no confirmed cases in Alaska, but some are expected in time. The state is working to stretch its test kits by combining low to medium risk cases under a bulk testing process.
• Work continues on the “Alaska Reads Act” (Senate Bill No. 6 by Senator Tom Begich (D- Anchorage)). The bill is now in the Senate Finance Committee which has heard public testimony on the bill. Next week the House Education Committee plans to begin hearings on House Bill No. 153 by Representative Harriet Drummond (D-Anchorage) and the governor’s version (House Bill No. 204). A presentation by DEED Commissioner Michael Johnson and Senator Begich will start this effort in the House on March 9.
• A bill to increase the Base Student Allocation (BSA) by Representative Andi Story (D- Juneau) passed out of its first committee on March 6. House Bill No. 236 increases the BSA by $115 in FY 2021 and another $110 in FY 2022, which translates into an increase of over $50 in K-12 funding by year two.
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Page 72 of 188 Summary of State Legislation
Below is a list of legislative measures of interest, divided into five main topics: fiscal measures, general municipal issues, education measures, fishery & resource issues, and energy matters. House measures are described first, followed by Senate measures. Companion bills (measures in both bodies) are listed together, with priority given to bills sponsored by majority members. More information about these measures can be found at Alaska State Legislature.
Check out what your legislators are doing in Juneau! New bills are in BLUE, change in status in RED, and passed bills in GREEN.
Fiscal Measures
Measure Summary Status HCR 13 by House Resolves that the Alaska State Legislature vows to HCR 13 passed House Rules defend the Alaska Permanent Fund, to maintain a 3/2, referred Senate PFD and to safeguard our oil and investment Rules wealth.
HJR 1 by Proposes a constitutional amendment to prohibit a HJR 1 pending House Rauscher broad-based individual income or statewide sales State Affairs tax without the approval of the voters in Alaska.
HJR 3 by Tuck Proposes a constitutional amendment to enshrine HJR 3 pending House dividend in the constitution and require use of State Affairs “prudent investor rule” for Permanent Fund corpus.
HJR 15 by Proposes a constitutional amendment to make veto HJR 15 heard & held Josephson overrides for all governor actions subject to a two- House Finance 3/4 SJR 14 by Senate thirds vote of the membership of the legislature. SJR 14 heard & held Judiciary Includes any bills to raise revenue or appropriations. Senate State Affairs 2/25
HJR 16 by Tuck Proposes a constitutional amendment to establish a HJR 16 pending House biennial state budget. State Affairs
HJR 18 by Kreiss- Proposes a constitutional amendment consolidating HJR 18 pending House Tomkins the Permanent Fund into a single account, thereby Judiciary eliminating the earnings reserve account. Sets the POMV draw from the Permanent Fund to no more than 5% of the Fund’s market value.
HJR 22 by Kreiss- Proposes constitutional amendment to repeal HJR 22 pending House Tompkins requirement to repay funds to the CBR fund. State Affairs
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Page 73 of 188 Measure Summary Status HB 132 by Wool Ties value of future PFD’s directly to the price and HB 132 pending House production of oil and its revenues. Reserves POMV Finance draw for state services. Eliminates mandatory inflation-proofing.
HB 141 by Kreiss- Changes the PFD from an annual disbursement to HB 141 pending House Tomkins quarterly payments for all eligible individuals. State Affairs . HB 239 by Establishes a state lottery and provides for HB 239 heard & held Thompson participation in multi-state lotteries. Establishes a House State Affairs 2/25 state lottery board.
HB 246 by Establishes the Alaska Lottery Corporation to HB 246 pending House governor oversee new state lottery. Corporation decides State Affairs SB 188 by what games to offer. Potential revenue estimated to SB 188 pending Senate governor range from $25 to $100 million per year. State Affairs
HB 259 by Provides an additional 2019 PFD payment of $1,304 HB 259 scheduled House governor to every individual who received a 2019 PFD and is Finance 3/9 SB 205 by eligible for a 2020 PFD. SB 205 pending Senate governor Finance
HB 300 by Wool Allows money from the Earnings Reserve Account HB 300 referred House (ERA) to be appropriated to the Community Finance, scheduled Assistance Fund, but sets an annual $1,200 per Finance 3/10, 3/11, 3/12, capita limit on payments. Prohibits distributions 3/13 from the ERA that exceed the available balance.
HB 306 by House Proposes an 80/20 distribution of Permanent Fund HB 306 referred House Rules earnings between general fund and dividends. Finance, scheduled Establishes a Permanent Fund Dividend Task Force Finance 3/10, 3/11, 3/12, to start work in 2026. 3/13
SJR 1 by Proposes a constitutional amendment to guarantee SJR 1 pending Senate Wielechowski a Permanent Fund (PF) dividend using a Percent of State Affairs Market Value (POMV) method.
SJR 2 by Begich Proposes a constitutional amendment for annual SJR 2 pending Senate dividends and to support state services. Sets draw State Affairs at 5% of POMV, with 40% for dividends, 40% for services and 20% for inflation-proofing.
SJR 4 by Proposing a constitutional amendment requiring the SJR 4 pending Senate governor vote of the people for new taxes or an increase to Finance HJR 5 by existing taxes. HJR 5 pending House governor State Affairs
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Page 74 of 188 Measure Summary Status SJR 5 by Proposing a constitutional amendment to enshrine SJR 5 pending Senate governor the PF dividend formula in the Constitution. Finance HJR 6 by Requires subsequent vote of the people to change HJR 6 pending House governor the program in the future. State Affairs
SJR 6 by Proposing a constitutional amendment that creates SJR 6 pending Senate governor a new spending cap that permits minimal increases Finance HJR 7 by based on population and 50% of inflation. HJR 7 pending House governor State Affairs
SJR 20 by Shower Proposes constitutional amendment requiring a SJR 20 referred Senate biennial state budget with a regular and budget State Affairs, Finance session in odd-numbered years and the option of a budget session only in even-numbered years. Sets new, shorter time limits on sessions and restricts how certain bills are introduced.
SB 14 by Repeals per barrel oil tax credit. May generate SB 14 pending Senate Wielechowski between $1 to $1.5 billion annually. Resources
SB 17 by Proposes a special appropriation of $2.39 billion to SB 17 pending Senate Wielechowski pay supplemental PF dividends. State Affairs
SB 23 by Funds back payment of PF dividends for years SB 23 pending Senate governor 2016, 2017 & 2018. Amounts range from $1,100 to Finance HB 46 by $1,300 per year. Payment spread over three years. HB 46 pending House governor Passage is contingent on enactment of SB 24. State Affairs
SB 24 by Sets eligibility requirement for recipients of back SB 24 pending Senate governor payment for PF dividends. Must be eligible both in Finance HB 47 by current year and the previous year HB 47 pending House governor State Affairs
SB 50 by Bishop Establishes an annual employment tax of $30 on SB 50 heard & held wages and net earnings from self-employment. Senate Finance 2/28 Permits use of proceeds to fund education facilities.
SB 92 by D. Expands the permanent fund dividend application to SB 92 pending Senate Wilson allow an applicant to direct all or a part of their PFD Finance to the general fund.
SB 103 by Senate Amends use of Earning Reserve POMV draw SB 103 pending Senate Finance splitting it 50/50 between Permanent Fund Rules dividends and use for government services. Limits annual POMV draw to 5%.
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Page 75 of 188 Measure Summary Status SB 104 by Senate Proposes new statutory spending limit formula of $5 SB 104 pending Senate Finance billion annually in unrestricted general funds. Finance HB 131 by House Provision included for inflation adjustments and HB 131 pending House Finance disasters. Finance
SB 115 by Bishop Increases motor fuel tax from 8 cents to 16 cents a SB 115 passed Senate gallon and the tax on all watercraft motor fuel from 5 3/2, scheduled House cents to 10 cents a gallon. Transportation 3/10, 3/12
SB 129 by Omnibus bill to amend oil and gas production taxes, SB 129 pending Senate Wielechowski reversing many of the changes adopted under SB Resources 21 passed in 2014.
SB 152 by FY 2021 Operating Budget: Proposes status quo SB 152 pending Senate governor budget compared to FY 2020 budget with a few Finance HB 205 by additions reversing cuts. Provides flat funding for K- HB 205 passed House 3/3 governor 12 but doesn’t include the $30 million in one-time with minimal changes money provided in current year. School debt Referred Senate Finance reimbursement funded at 50%. $30 million deposit proposed for Community Assistance fund. SB 174 by FY 20 supplemental appropriations bill: Requests SB 174 heard & held governor $262.5 million for wildfire suppression, Medicaid Senate Finance 2/27 HB 234 by requirements, AMHS operations and vessel repairs HB 234 passed House governor and miscellaneous costs. 2/26, heard & held Senate Finance 3/4 SB 227 by Establishes the amount of the PFD at $1,600 for SB 227 referred Senate Hoffman 2020 and 2021. Establishes a 50/50 split from the Finance earnings reserve account (ERA) between appropriations for dividends and the general fund.
General Municipal Issues
Measure Summary Status HJR 2 by Claman Proposes constitutional amendment to limit regular HJR 2 pending House legislative sessions to ninety days. State Affairs
HB 2 by Rauscher Proposes relocation of the legislature and regular HB 2 pending House legislative sessions to Anchorage. C&RA HB 17 by Rauscher Repeals the certificate of need (CON) program for HB 17 pending House SB 1 by Wilson health care facilities H&SS SB 1 pending Senate FIN
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Page 76 of 188 Measure Summary Status HB 25 by Sullivan- Amends definition of “peace officers” to include HB 25 pending House Leonard employees of a private police organization and C&RA places such groups under regulation by the Alaska Police Standards Council.
HB 43 by Exempts state from observing daylight savings HB 43 pending House Rauscher time. Requires petition to U.S. Dept. of State Affairs Transportation to place Alaska in all or part of the Pacific Standard Time zone.
HB 76 by Adopts the 2018 International Residential Code as HB 76 pending House Rasmussen the state residential code. If a municipality has its C&RA own construction code, it has to meet or exceed the state code within two years.
HB 79 by Kopp Allows firefighters and peace officers to join a HB 79 heard & held defined benefit retirement plan. Establishes House Finance 3/4 medical benefits eligibility requirements and payment for past service provisions.
HB 81 by Prohibits use of disposable plastic shopping bags HB 81 pending House Josephson and provides for an administrative fine against a Labor & Commerce retail seller who is in violation.
HB 82 by Expands duties of State Commission for Human HB 82 pending House Josephson Rights with new provisions prohibiting Judiciary SB 82 by discrimination based on sexual orientation or SB 82 pending Senate Kawasaki gender identity. Applies to political subdivisions. State Affairs
HB 83 by Kreiss- Prohibits return of absentee ballots by fax to the HB 83 heard & held Tomkins Division of Elections. Senate STA 3/3
HB 84 by Expands coverage to include emergency medical HB 84 heard & held Josephson technicians, paramedics, and peace officers when it House Labor & comes to the presumption of compensability for a Commerce 2/24, 2/28 disability resulting from certain diseases.
HB 106 by T. Extends moratorium on school bond debt HB 106 pending Senate Wilson reimbursement program until July 1, 2025. Finance
HB 107 by Allows a first class or home rule city to petition the HB107 pending House Sullivan-Leonard ABC Board to authorize and regulate alcoholic C&RA SB 96 by D. beverage licenses for a restaurant, eating-place or SB 96 pending Senate Wilson a package store within that municipality. Labor & Commerce
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Page 77 of 188 Measure Summary Status HB 110 by Establishes authority to transfer a boat or vehicle HB 110 pending House Spohnholz title on death of the owner to a designated Judiciary beneficiary.
HB 115 by Tuck Allows voters to receive absentee ballots by mail for HB 115 passed House, SB 105 by future state elections for a four-year period, versus pending Senate STA Kawasaki having to reapply each election cycle. SB 105 pending Senate STA HB 142 by Kreiss- Authorizes Alaska Native entities to appoint, train, HB 142 passed House, Tomkins supervise and retain village public safety officers pending Senate C&RA (VPSO). HB 145 by House Omnibus crime bill providing increased sentencing HB 145 pending House Judiciary ranges, stronger penalties for drug dealers, Judiciary additional tools to prosecute theft, and closes sex offense and offender registration loopholes. HB 187 by Fields Prohibits prisoners from being sent out of state with HB 187 heard & held SB 138 by Gray- narrow exceptions related to medial treatment House Finance 3/6 Jackson needs. Prohibits use of a private facility within SB 138 pending Senate Alaska. State Affairs HB 200 by Tarr Known as the Wage Disclosure Act, employers HB 200 pending House cannot use an applicant’s past wages/benefits for State Affairs determining future wages/benefits. Adds other provisions to counter gender-based wage discrimination. HB 221 by Kopp Requires state recognition of Alaska’s 229 federally HB 221 passed House recognized tribes. C&RA 3/3, referred Rules HB 229 by Creates the Alaska Health Care Transformation HB 229 pending House Spohnholz Corporation with intent to provide more trans- L&C SB 201 by Von parency to see providers’ health care charges. SB 201 pending Senate Imhof Includes a municipal seat on board. L&C
HB 232 by Allows certain municipalities to provide a property HB 232 passed House Hopkins tax credit for air quality improvements and energy L&C 3/3, referred Rules SB 175 by Bishop efficient new construction. SB 175 pending Senate C&RA HB 249 by Stutes Establishes the Alaska Marine Highway System HB 249 pending House Corporation to manage AMHS using a seven- Transportation member board. Provides transitional language throughout the statutes to effect this change. HB 253 by Kreiss- Prohibits the selling, transfer, or otherwise disposal HB 253 heard & held Tomkins of a state-owned ferry without legislative approval. House TRA 2/25, scheduled 3/10 HB 262 by Sets the date of regular municipal elections is the HB 262 pending House Rasmussen first Tuesday of October or November. Eliminates C&RA option to use a different month (such as what Anchorage has done).
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Page 78 of 188 Measure Summary Status HB 268 by LeBon Prohibits the Alaska Municipal Bond Bank Authority HB 268 scheduled House from assisting the University of Alaska (UA) to fund Finance 3/12 heating or energy projects. Increases bonding amounts for other UA or regional health entity projects. HB 287 by Kopp Implements nine recommendations of the Village HB 287 referred House SB 231 by Olson Public Safety Officers (VPSO) Working Group, Tribal Affairs, JUD, FIN transfers grant management to Dept. of Commerce, Scheduled TRB 3/10, Community and Economic Development, and 3/11, 3/13 mandates background investigations of VPSO SB 231 referred Senate applicants. See presentation for more details. State Affairs, Finance Scheduled STA 3/10 HB 292 by Ortiz Allows the state to observe daylight saving time HB 292 referred House throughout a calendar year. This change can only State Affairs, Finance take effect if the US Congress amends federal law.
SB 5 by Stevens Requires Permanent Fund Corporation to manage SB 5 pending Senate certain municipal investment assets if requested. C&RA
SB 45 by Shower Authorizes a municipality or Regional Educational SB 45 pending Senate Attendance Area (REAA) to impose term limits on Education school board members. Requires a vote of qualified voters for REAAs. SB 46 by Kiehl Allows teachers and other public employees a SB 46 pending Senate choice between a defined benefit pension versus C&RA the current defined contribution 401(k) plan. Same bill introduced in previous legislatures. SB 52 by Micciche Omnibus bill relating to the manufacture, distri- SB 52 passed Senate bution, bartering, licensing, possession and the sale 2/26, scheduled House of alcoholic beverages in Alaska. Provides that L&C 3/9, 3/11 only the ABC Board may issue, renew, transfer, relocate, suspend or revoke a license under Title 4. SB 57 by governor Repeals ability of municipalities to levy tax on oil SB 57 pending Senate HB 59 by governor and gas exploration, production, and pipeline C&RA property. Excludes value in determining required HB 59 pending House local contribution for education. Resources
SB 58 by governor Repeals the Senior Benefits Program on June 30, SB 58 pending Senate HB 60 by governor 2019. Currently, program expires on June 30, 2024. H&SS HB 60 pending House C&RA SB 59 by governor Repeals statutes requiring state reimbursement of SB 59 pending Senate HB 61 by governor debt for various programs, including certain port Finance and harbor and power projects. Impacts Kodiak HB 61 pending House Electric, Aleutians East and Lake and Peninsula Education Boroughs.
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Page 79 of 188 Measure Summary Status SB 62 by governor Permits the legislature to appropriate half of the SB 62 pending Senate HB 64 by governor proceeds from the Alcoholic Beverage Excise Tax C&RA to be directed for Community Assistance program. HB 64 pending House H&SS SB 63 by governor Repeals the statutes that provide revenue sharing SB 63 pending Senate HB 65 by governor to municipalities from the Fisheries Business Tax C&RA and the Fishery Resource Landing Tax. HB 65 pending House Fisheries SB 64 by governor Repeals all statutory authority that requires state SB 64 pending Senate HB 66 by governor aid to municipalities for reimbursement of school Finance construction bonded debt. HB 66 pending House C&RA SB 67 by governor Repeals the Alaska Public Broadcasting Com- SB 67 pending Senate HB 69 by governor mission as of June 30, 2019, transferring its assets State Affairs to Alaska non-profit public broadcasting entities. HB 69 pending House C&RA SB 102 by Allows employers to adopt a retirement incentive SB 102 pending Senate Kawasaki program (RIP) for both TRS and PERS members of State Affairs a defined benefit plan.
SB 107 by Gray- Expands state law to include emergency medical SB 107 pending Senate Jackson technicians, paramedics, and a peace officer so Labor & Commerce that a presumption exists for a claim regarding disability compensation.
SB 110 by Removes funding mechanism from Community SB 110 pending Senate governor Assistance Fund. Repeals the following funds: Civil C&RA HB 130 by Legal Services, PCE Endowment, PCE and Rural HB 130 pending House governor Electric Capitalization, Curriculum Improvement and Energy Best Practices, and the Alaska Higher Education Investment Funds. SB 128 by Prohibits Dept. of Transportation & Public Facilities SB 128 pending Senate Costello from increasing any fees or imposing new charges Transportation related to aviation unless they first obtain legislative approval.
SB 135 by Hughes Provides enhanced access to payment information SB 135 pending Senate from health care insurers, incentive programs and Labor & Commerce out-of-network providers. Preempts municipalities from regulating disclosure or reporting of such information.
SB 157 by Authorizes 6-month temporary licensing for over SB 157 pending Senate governor 100 professions. Repeals registration of other Labor & Commerce HB 216 by types of businesses. HB 216 pending House governor Labor & Commerce
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Page 80 of 188 Measure Summary Status SB 218 by Coghill Allows for consolidation of road service areas SB 218 scheduled Senate HB 289 by Wool without voter approval if two or more service area C&RA 3/10 boards request consolidation for the purpose of HB 289 referred House creating a single new service area that includes all C&RA, Resources parcels from both areas and no additional parcels.
Education Measure
Measure Summary Status HJR 17 by Kopp Urges Congress to repeal federal law prohibiting HJR 17 pending House Indian Self-Determination and Education Tribal Affairs Assistance funds for use by tribes for education.
HB 11 by Rauscher Allows current or former state troopers to elect HB 11 pending House participation in a defined benefit retirement plan. Labor & Commerce Does not apply to teachers, other law enforcement or other public employees.
HB 24 by Kreiss- Expands scope of teacher certificates for teachers HB 24 passed House L&C Tompkins fluent in an Alaska Native or foreign language 2/28, scheduled House SB 203 by Olson initially for a one-year period. House CS adds Finance 3/10 clarity and limitations. SB 203 pending Senate EDC HB 67 by governor Adds responsibility to Department of Labor & HB 67 pending House SB 65 by governor Workforce Development to coordinate and monitor Education state career and technical education programs with SB 65 pending Senate DEED, UA and others. Finance
HB 75 by HB 75 expands download requirements and HB 75 pending House Rasmussen funding options for Internet services for school Finance SB 74 by Hoffman districts. SB 74 contains funding piece only. SB 74 pending House Rules SSHB 108 by Establishes a required K through 3rd grade reading HB 108 pending House LeDoux program in all schools or districts. Specifies Education mandatory student retention in grade 3.
HB 109 by LeDoux Amends school count requirements for K-12 HB 109 passed Senate foundation formula to include military dependents State Affairs 2/25, heard recently transferred or expected. & held Senate EDC 3/3
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Page 81 of 188 Measure Summary Status HB 128 by Kreiss- Sets goal that by 2025 at least 4% of public school HB 128 pending House Tomkins teachers will achieve national board certification. C&RA SB 113 by Hughes Requires schools display the name of teachers SB 113 scheduled Senate who have achieved this certification. EDC 3/12 HB 136 by Hopkins Requires school districts to allocate .5% of state HB 136 heard & held aid to social and emotional learning. House Education 2/28, 3/2 HB 155 by Story Makes career/technical education work eligible for HB 155 passed House Alaska performance scholarship program. Education 2/28, scheduled Finance 3/10 HB 181 by Claman Directs Board of Education and Early Development HB 181 passed House SB 197 by to develop guidelines for instruction in mental EDC 2/28, scheduled Gray-Jackson health in consultation with the HSS department. Finance 3/10 SB 197 pending Senate EDC HB 188 by Fields Clarifies that cash or equipment contributions can HB 188 pending House be accepted for a range of childcare and similar Education facilities as a credit against any lawful tax.
HB 196 by Fields Specifies that first award for Alaska Performance HB 196 pending House Scholarships will be an amount equal to the Education average cost of resident tuition at the U of A.
HB 236 by Story Increases the Base Student Allocation (BSA) by HB 236 passed House $115 in FY 2021 and another $110 in FY 2022. Education 3/6 Translates into a total increase of over $50 million in K-12 funding by second year.
HB 237 by Story Proposes special appropriations of $20 million as HB 237 scheduled House grants to school districts for early literacy programs Education 3/11 over next two fiscal years.
HB 254 by Replaces the Professional Teaching Practices HB 254 pending House Johnston Commission with the Alaska Educator Standards EDC Commission. Mandates additional training requirements for teacher certification.
HB 256 by Hopkins Creates a Teacher Workforce Enhancement HB 256 pending House Program to address the growing shortage of EDC teachers in the state.
HB 260 by Tarr Adds the principles of early childhood and youth HB 260 heard & held brain development to the state’s education House EDC 2/28, 3/2 policy requirements under Title 14.
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Page 82 of 188 Measure Summary Status HB 269 by Hopkins Requires larger school districts to give teachers HB 269 pending House who are nursing mothers’ reasonable breaks and Education a location to express breast milk.
SJR 9 by Costello Proposes constitutional amendment requiring SJR 9 pending Senate governor to submit separate K-12 funding bill and Finance legislative approval by 45th day of session. Amended to require forward funding.
SSSB 6 by Begich Proposes statewide K-3 reading program and CSSB 6 heard & held HB 153 by expands pre-K program for 4 & 5-year olds. Senate Finance 2/26 Drummond Retention at grade 3 likely unless exempt by HB 153 scheduled House school board. Senate Education CS adds annual EDC 3/9, 3/11, public reading program review panel with teachers and a testimony 3/14 teacher retention task force.
SB 30 by Stevens Establishes new middle college program for public SB 30 heard & held school students at the University of Alaska. This Senate Finance 3/6 bill was rolled into SB 114.
SB 31 by Stevens Requires establishment of a foundational SB 31 pending Senate curriculum for first year of lower division courses to Education ensure more transferability of credits between programs at the University of Alaska.
SB 53 by Stevens Requires biennial report to the legislature SB 53 pending Senate regarding accreditation status of the University of Finance Alaska. This bill was rolled into SB 114. SB 56 by Costello Amends state law to require school districts to SB 56 pending Senate HB 70 by provide physical education. Education Rasmussen HB 70 pending House C&RA SB 79 by Hughes Requires DEED to establish a virtual education SB 79 pending Senate consortium, provides for more stringent standards Education for Praxis tests, and expands reporting of school district and employee’s performance. Most portions of this bill rolled into SB 114. SB 114 by Senate Omnibus education bill combining HB 108 (Read SB 114 pending Senate Education By 9) without mandatory retention, SB 30, SB 53, Education most portions of SB 79, and creates a virtual education consortium task force.
SB 126 by Shower Mandates consolidation of school districts, SB 126 pending Senate HB 194 by Vance reducing number from 54 to 18. Includes REAAs. Education HB 194 pending House C&RA
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Page 83 of 188 Measure Summary Status SB 127 by Shower Requires conversion of 9 community colleges SB 127 pending Senate across the state to “virtual learning centers” & Education “higher education portals” by June 30, 2023.
SB 136 by Stevens Allows establishment of public schools through SB 136 heard & held state-tribal compacts. Provides authority for Senate Education 2/27 creation of state-tribal compact schools and defines scope and other requirements.
SB 142 by Begich Mandates reporting of radiofrequency radiation SB 142 pending Senate exposure in schools by the HSS department to EDC DEED.
SB 149 by Costello Requires every public high school to begin each SB 149 scheduled Senate HB 294 by session at 8:30 a.m. or later. EDC 3/12 Rasmussen HB 294 referred House EDC, C&RA SB 151 by Referred to as the “Alaska Reads Act”, bill creates SB 151 pending Senate governor a statewide K-3 reading policy and program. Education HB 204 by Program includes early education grants, literacy HB 204 scheduled House governor and reading intervention. Specifies mandatory Education 3/9 student retention in grade 3. Expands pre-K program for 4 and 5-year olds similar to Begich proposal in SB 6.
SB 211 by Costello Provides an annual bonus of at least $10,000 a SB 211 pending Senate year for a national board certificated teacher EDC employed as a classroom teacher in a public school.
SB 233 by Prohibits public employers from deducting union SB 233 referred Senate Reinbold dues, fees and political campaign contributions, or Judiciary, Labor & including union “security” provisions in a collective Commerce bargaining agreement.
SB 235 by Adds new DEED reporting on collection, handling SB 235 referred Senate Reinbold and publication of student data. Creates new EDC, Finance restrictions on student data collection/storage.
SB 236 by Prohibits expenditure of state money on common SB 236 referred Senate Reinbold core curriculum and adds a fine of $10,000 for a EDC, Finance violation.
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Page 84 of 188 Fishery & Resources Issues
Measure Summary Status HB 19 by Knopp Exempts some water taxi operators from regulation HB 19 pending House as transportation services by the Big Game Transportation Commercial Services Board.
HB 35 by Stutes Allows members of the Board of Game or Fisheries HB 35 pending Senate to deliberate and participate on certain matters even State Affairs if they or an immediate family member have a personal or financial interest.
HB 74 by Repeals the Ocean Rangers Program providing HB 74 pending House governor observers onboard large commercial vessels to Finance SB 70 by monitor compliance with marine discharge and SB 70 pending Senate governor pollution laws. Resources
HB 116 by Story Clarifies statutes to streamline renewal or extension HB 116 pending Senate of aquatic farming and hatchery site leases. Finance
HB 117 by Authorizes municipalities to regulate trapping for the HB 117 pending House Josephson limited purpose of preventing injury to persons or Resources property.
HB 137 by Tuck Requires use of permit system to limit the taking of HB 137 pending House big game by nonresidents whenever restrictions are Resources needed for residents.
HB 138 by Kopp Clarifies that the process for classifying water HB 138 schedule House bodies as Outstanding National Resource Waters Resources 3/9, 3/11 (ONRW) rests with the legislature. HB 185 by Stutes Exempts certain commercial vessels that have a HB 185 passed House SB 145 by valid license under AS 16.05 from the numbering TRA 2/25, scheduled Micciche and registration provisions of AS 05.25. Finance 3/9 SB 145 passed Senate Resources 2/24, referred Finance HB 199 by Establishes a fisheries rehabilitation permitting HB 199 passed House Talerico process and specifies what an applicant must Fisheries 2/25, referred provide to DF&G. Resources
HB 203 by Knopp Removes transport restrictions on the transportation HB 203 passed House of live King, Dungeness and Tanner crab species 3/5, referred Senate taken commercially. Resources
HB 231 by Vance Allows for the display of fishing, hunting and HB 231 pending House trapping licenses on electronic devices. Resources
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Page 85 of 188 Measure Summary Status HB 252 by Tuck Proposes new “mentoring” program for limited entry HB 252 pending House SB 220 by permit holders allowing a second name to be added Fisheries Hoffman subject to certain restrictions. Provides unlimited Sb 220 referred Senate emergency transfer authority for a surviving spouse. Resources, Finance
HB 258 by Gives the Dept. of Natural Resources (DNR) sole HB 258 pending House governor platting authority over state-owned lands regardless Resources SB 204 by of location. Other provisions relate to leasing and SB 204 pending Senate governor sale of state lands and repeals establishment of Resources recreational rivers and corridors.
HB 270 by Establishes state land vouchers in lieu of a PFD that HB 270 pending House governor can be used to purchase state land. Value would Resources SB 217 by be set at twice the monetary value of that year’s SB 217 heard & held governor statutory PFD calculation. Vouchers do not expire Senate Resources 3/2 and can be sold.
HB 280 by Tarr Establishes the Alaska Invasive Species Council in HB 280 referred House the Dept. of Fish & Game. Creates the operating Resources, Finance parameters and how members are selected.
HB 286 by Shaw Requires the Board of Game to establish a week- HB 286 referred House long early season opening in each hunting area for Military & Veterans veterans in receipt of a purple heart or vets certified Affairs, Resources having incurred a 50 percent or greater disability rating during military service.
HB 293 by Rewrites the qualifications and conditions under HB 293 referred House Talerico which the department may issue a trapping cabin Resources, Finance permit.
SB 22 by Stevens Relates to management of enhances stocks of SB 22 pending Senate HB 41 by Ortiz shellfish, authorizes certain nonprofits to engage in Finance shellfish enhancement projects, and increases HB 41 pending Senate salmon hatchery permit fees from $100 to $1000. Finance
SB 87 by Coghill Mandates use of permit system limitations on taking SB 87 pending Senate of big game by nonresidents whenever state Resources residents face sustained yield restrictions.
SB 90 by Micciche Establishes Cook Inlet buy-back program for set net SB 90 pending Senate entry permits and provides for a vote by permit Finance holders whether to be included. Broadens CFEC authority to establish management areas.
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Page 86 of 188 Measure Summary Status SB 99 by Requires the Board of Fish to place restrictions on SB 99 pending Senate Kawasaki all other fisheries before restricting personal use Resources fisheries except when the harvest of a stock or species is limited to achieve a management goal. SB 130 by Add pollock and cod to the product development tax SB 130 scheduled, but Stevens credit up to 50% of the taxpayer’s tax liability. cancelled Senate Extends date to take credit for property first placed Resources 3/4 into service by Dec. 31, 2025.
SB 150 by Revak Repeals the termination date for the intensive SB 150 scheduled Senate HB 230 by Lincoln management hunting license surcharge. Finance 3/12 HB 230 heard & held House Finance 3/5
SB 214 by Kiehl Authorizes issuance of a permanent identification SB 214 pending Senate card for fishing, hunting, or trapping to an individual Resources honorably discharged from military service who incurred a 50% or greater disability during such service.
SB 232 by Creates “personal use fishing permits” and sets the SB 232 referred Senate Micciche fee at $5. Requires the Dept. of Fish & Game to Resources, Finance charge this fee and then account for receipts Scheduled Senate separately. Resources 3/6
Energy Matters
Measure Summary Status HJR 26 by Tuck A resolution that urges Alaska’s delegation in HJR 26 pending House Congress to implement and support a renewable Energy energy testing program in the state.
HB 32 by Kreiss- Makes federally recognized tribes and non-profits HB 32 pending House Tompkins eligible for loans from the Alaska energy efficiency Rules revolving loan fund.
SB 48 by Begich Adds goal to the state energy policy that at least 50 SB 48 pending Senate percent of the energy used by the state be obtained C&RA from clean energy sources by 2025.
17 Mark Hickey March 8, 2020
Page 87 of 188 Measure Summary Status SB 49 by Begich Sets goal to spend $100 million to retrofit public SB 49 pending Senate facilities and schools by 2025 and adds public C&RA schools to energy audit program.
SB 143 by Begich Allows a utility providing natural gas or electrical SB 143 pending Senate service to install a smart meter. Utilities must send Labor & Commerce the customer a written notice first. Customer can elect not to have a smart meter installed.
SB 194 by Senate Adds advanced nuclear reactors to the list of other SB 194 heard & held C&RA nuclear facilities requiring a DEC permit to allow Senate C&RA 3/3, construction in Alaska. scheduled 3/10
SB 207 by Establishes the Electric Vehicle Infrastructure Fund SB 207 pending Senate Wielechowski within the Dept. of Commerce, Community & L&C Economic Development for the purpose of grants and loans.
SB 208 by Appropriates the balance of the Alaska Capstone SB 208 pending Senate Wielechowski Avionics revolving loan fund to the Electric Vehicle L&C Infrastructure Fund.
18 Mark Hickey March 8, 2020
Page 88 of 188 Lake and Peninsula Borough P.O. Box 495 King Salmon, Alaska 99613
Telephone: (907) 246-3421 Fax: (907) 246-6602
March 11, 2020 To: Mayor Alsworth Assembly members From: Kate Conley Re: Clerk’s Report
Meetings & Schedules – Obviously this month’s meeting is by teleconference. April – April 15th and 16th – The Assembly will attend the SNAP meet in Newhalen on Thursday April 15. Southern Assembly members will fly to King Salmon on the 14th, northern members will be picked up on our way to Newhalen on the 15th. We will then all return to King Salmon on Thursday afternoon. Our Assembly meeting will be Friday morning, and everyone should be able to return home on Friday. May – May 12th. The third Tuesday of May is actually the 19th, but we usually like to have this meeting early, so I am recommending the 12th in King Salmon, as we will need to approve the budget.
Website – Did anyone do a survey? Anyone? We are now working on assigning templates to the pages. The wire frame (like an outline) keeps getting streamlined. It really does look nice, and I think you will be impressed with the final product. This has also brought us to think outside the box on our mapping and Danica and Natalie are working on some interesting options.
Iliamna Barge – I have been working with DCCED to establish the site control at the barge landing. As we learned last year at the public hearing, there is municipal land trust property between our lease from DNR and the road. Travis Neff at DNR has been invaluably helpful in navigating these problems. Bob Loeffler is helping me to decipher the technicalities. The good news is there is progress! We are hoping Travis will be able to be in Iliamna the same day as we are in Newhalen and he will hold a public hearing seeking resident approval of the lease to the borough. One minor annoyance is that there is also a campsite mapped directly on the barge landing site in an old BLM map. This particular legal category of camping site can only exist on ANCSA land, and there is none in the area; therefore, the site is moot. We will take argument to BLM and ask them to officially acknowledge this logic. I will keep you informed of the progress. POFD Reports – As of yesterday morning, I only had five people who had not yet filed. That’s 5 of 22, so I was pretty impressed with how early you all have filed. Nice job.
Archiving – I will be posting for a surplus property next week, so hopefully all this extra furniture will be gone by the time you all visit in April.
Chignik Bay • Chignik Lagoon• Chignik Lake• Egegik • Igiugig• Iliamna • Ivanof Bay• Kokhanok• Levelock • Newhalen • Nondalton• Pedro Bay• Perryville• Pilot Point• Pope Vannoy• Port Alsworth• Port Heiden• Ugashik
Page 89 of 188 COVID19 – I have spent been working closely with Danica on our response. I have attached the press release we did earlier this week. This is unfolding daily. Today the Governor declared and emergency and in my inbox this afternoon is multiple notices of conference cancellations. We sat in on the White House teleconference for tribal and local leaders this morning. There were 5000 people on the conference call! My takeaway was 1) individual responsibility, 2) social distancing, 3) empowering schools and businesses to implement quarantines when necessary. To each of you I encourage you to do your part. Remember if you are young and healthy, you still must be vigilant to protect others in your community who are elderly or immunocompromised.
Chignik Bay • Chignik Lagoon• Chignik Lake• Egegik • Igiugig• Iliamna • Ivanof Bay• Kokhanok• Levelock • Newhalen • Nondalton• Pedro Bay• Perryville• Pilot Point• Pope Vannoy• Port Alsworth• Port Heiden• Ugashik
Page 90 of 188 Lake and Peninsula Borough P.O. Box 495 King Salmon, Alaska 99613
Telephone: (907) 246-3421 Fax: (907) 246-6602
TO: Residents of Lake and Peninsula Borough FROM: Mayor Glen R. Alsworth, Sr. DATE: March 9, 2020 RE: Coronavirus (COVID-19)
Dear Fellow Residents,
Since the December 2019 discovery of the Coronavirus, its spread has dominated news reports. We are all concerned about the spread of the coronavirus and its impact on our community, our families, and our loved ones. For that reason, I’m writing to share with you several things that the Borough is doing, and that we can all do to take care of ourselves and each other. The purpose of this notice is to emphasize and acknowledge the concern, inform the residents of current efforts, and to assure everyone to take preventative measures.
First, over the last couple of weeks we have been in touch with the State of Alaska Emergency Operations Center, and Department of Health and Social Services, the Lake and Peninsula School District, and have reached out to BBAHC and Southwest Regional Health. We are all working together to secure the health and safety of all Alaskans.
Second, before I get to the steps all of us can and should take, let me tell you some of the practical facts everyone should know: It’s important for all of us to align our efforts around a single lead agency. In Alaska, that is the Department of Health and Social Services (DHSS). Because it is expected that DHSS will have a heavy workload in the near future, they have formed a division of Emergency Operations to respond to the COVID-19 outbreak. Please note this is DHSS EOC, and not the State Emergency Operations Center (SEOC). DHSS EOC email is [email protected] and non-medical information hotline is 907-269-3046. At the moment there are no confirmed cases of the coronavirus in Alaska. Obviously, that’s subject to change, but you need to know where we are, as of now. While the complete clinical picture of the coronavirus is not fully understood, the main symptoms are fever, cough, and shortness of breath. Most of the illnesses so far have been mild and have not required hospitalization. Those most at risk are older persons and people with chronic medical conditions. At this point our shared priority is prevention. Each of us can play a role in preventing the spread of germs.
Chignik Bay • Chignik Lagoon• Chignik Lake• Egegik • Igiugig• Iliamna • Ivanof Bay• Kokhanok• Levelock • Newhalen • Nondalton• Pedro Bay• Perryville• Pilot Point• Pope Vannoy• Port Alsworth• Port Heiden• Ugashik
Page 91 of 188 Lake and Peninsula Borough residents will all pull together, we will all work together, because we all care for each other. It’s just who we are—and we should all be proud of that.
As we learn more, and as the situation changes and evolves, Borough staff will continue to put out more letters and emails.
Sincerely,
Mayor Glen R. Alsworth, Sr.
Prevention tips
Avoid close contact with people who are sick. Avoid touching your eyes, nose, and mouth. Stay home when you are sick. Cover your cough or sneeze with a tissue, then throw the tissue in the trash. Clean and disinfect frequently touched objects and surfaces using a regular household cleaning spray or wipe. Wash your hands often with soap and water for at least 20 seconds, especially after going to the bathroom; before eating; and after blowing your nose, coughing, or sneezing. If soap and water are not readily available, use an alcohol-based hand sanitizer with at least 60% alcohol. Always wash hands with soap and water if hands are visibly dirty.
Coronavirus Resources
(To access the links below, click the text while pressing down on the CTRL button on your keyboard) Latest from the CDC Latest from Alaska Department of Health Preventing COVID-19 Spread in Communities What to do if someone is sick Cleaning and Disinfecting Recommendations Preparing your household Community Events & COVID-19
Page 92 of 188 THE LAKE AND PENINSULA SCHOOL DISTRICT 101 Jensen Drive P.O. Box 498 King Salmon, Alaska 99613 Phone (907) 246-4280 / Fax (907) 246- 4473
Date: March 9, 2020 To: Lake and Peninsula Borough Assembly From: Ty Mase Re: Superintendent’s Report – March 2020
Looking Forward
While it seems that we still struggle to maintain daily operations within our allotted budget, two new grants have allowed us to breathe a bit of energy and excitement back into LPSD. Looking toward next year we are excited to have many innovative initiatives / events slated:
Library Refresh – This summer we will begin the first phase of our “library refresh” program and we will be weeding, updating and refreshing our north site libraries. Next summer we will begin the same process with our south sites.
Summer Activities for Students – Igiugig is in the last year of their ANE Grant and will once again be offering many exciting cultural/educational programs throughout LPSD this summer. In addition, our federal literacy grant will be providing each student K-12 with STEM activities and summer bridge resources to work on over the summer (there will be incentives for those who finish these). Lastly, LPSD has 18 middle school applicants for the BBNC ANSEP academy in Anchorage from May 25 through June 6 – an outstanding science and engineering camp.
Literacy Professional Development – We haven’t been able to afford much professional development over the past 5 or 6 years so it is exciting to offer our staff summer college course stipends, a summer early literacy conference, early literacy training in Katmai and further literacy training in January. Add to this, monies to take folks to the RTI conference and our teachers will be exposed to some outstanding educational training.
Katmai Inservice – Through our Library/Literacy grants, we are excited to kick next year off with an all- staff inservice at the Katmai Lodge on the Alagnak River. We will be joined by Lexi Domaradzki and Shelby Skaanes who are touted as two of the premier early literacy trainers in Alaska. In addition to literacy, we will focus on each and every child as we go through our data review improvement process with each school site. We are looking forward to starting off the 2020/2021 school year with the excitement and energy that comes with brining our staff together.
October Inservice – In conjunction with our partner, Bristol Bay School District, we look forward to time together to share expertise and strengthen our instructional methodology. We plan to take this time to reflect on and strengthen many of the programs and techniques that make LPSD the strong instructional
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Page 93 of 188 district that it is – our standards based system, self-regulation, current online offerings, core curriculum, etc.
Online Offerings – We will enter our second year with our small school online math and language arts classes. So far that data has shown that these courses are working well and our kids are benefiting. We will however, closely monitor the PEAK scores (in comparison to last year) and we will also be surveying students at the end of the year to collect anecdotal data to assess the program further.
Literacy Mentoring – With the plan to offer intensive literacy professional development over the next five years we want to make sure everyone, especially new staff, are supported. Out of this need came our literacy coaching program where experienced LPSD educators will be assigned to non-tenured (new) staff to work with them throughout the school year. Our mentors for next school year are:
• Cassie Broscious (Nondalton) • Sara Erickson (Chignik Lagoon) • Dana Wolff (Kokhanok) • Barbra Donachy (Chignik Lake) • Matt Stark (Chignik Lake) • Nicole Metzgar (Port Alsworth)
Candice’s Books for Kids – With over 10,000 books delivered, we are celebrating a decade of sending books into the homes of our littlest Lake and Penners. With our new federal grant we are stocking up our supply of new books (and bags) with a budget of $10,000 a year.
Grants – While we currently have our hands full with our current awards, Zach is writing CTE grants and we are also hoping to pursue a counseling grant if a competition is announced. Lastly, we hope to pursue a teacher housing grant for a possible duplex in Igiugig.
CTE – While this program is now almost 10 years old, it is still exciting to watch it evolve with each passing year. Zach Stenson has many exciting opportunities on the horizon, we look forward to watching the program grow under his leadership.
Subsistence Calendar – It’s hard to believe that we are finishing up our third year with our new calendar! We have been approved by EED for another three-year waiver, allowing us to continue to measure learning based on performance and not the time that our students sit in a classroom chair.
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Page 94 of 188 Page 95 of 188 Memorandum January 3, 2020 Page 2 of 2
1. Applicant must be a federally-recognized American Indian Tribe or Alaska Native Village, or an entity owned or controlled by a federally recognized Tribe or Village or consortium of federally-recognized Tribes and Villages; 2. The requested license area is Tribal Land, which includes, as relevant to our clients, Native Allotments and AlaskaNative regions established pursuant to ANCSA; 3. The requested area is within a rural area, which is de?ned as lands that are not part of an urbanized area with a population equal to or greater than 50,000; and 4. The Tribe has a local presence on that Tribal Land.
Tribes determine the extent of the geographic area within their Tribal Land they wish include in their application. If multiple Tribes or Tribal entities bid for the same licenses in the same areas, those licenses automatically go out for commercial bidding. If there are not multiple Tribal bidders, FCC will award the license to the eligible Tribe or Tribal entity.
The FCC has divided the possible licenses into three groups for bid. The applications are accepted using FCC’s Universal Licensing System portal. Applicants will need to obtain an FCC Registration Number to apply. The FCC’s web page for tribal applicants is helpful: it is available at: hnps://www.fcc.gov/25»ghz-rural—1ribal-wind ow. Attached are some basic informational documents.
We are available to help with the application process, as requested.
Enclosures: Article on Wireless Spectrum; FCC Public Announcement Rural Tribal Window; FCC Report and Order October 19, 2019 (email only)
Page 96 of 188 Wireless spectrum: What it is, and why you should care
By Marguerite Reardon CNET.com News August 13, 2012
There has been a lot of talk over the past year about spectrum shortages, spectrum interference, companies proposing mergers just to get their hands on spectrum and even spectrum auctions that will help bail the nation out of debt.
But what exactly is wireless spectrum? And why are people in the wireless industry talking about it in apocalyptic terms?
These are good questions, so let's step back and explain what wireless spectrum is, why it's become increasingly scarce, and what regulators are supposed to (or not) do about it.
All wireless communications signals travel over the air via radio frequency, aka spectrum. The TV broadcast you watch, the radio program you listen to, the GPS device that helps get you where you're going, and the wireless phone service you use to make phone calls and check Facebook from your smartphone -- all use invisible airwaves to transmit bits of data through the air.
The easiest way to understand what spectrum really is and how it provides services is to look at your radio. When you tune your radio to 93.9 FM, you are tuning into a station that is broadcasting at 93.9 megahertz. If you want to a listen to a different station, like one that only plays country music or jazz, you turn the dial to another frequency like 104.7 FM. And a different radio station will be transmitting over that particular frequency on a different setting on your radio dial. No two stations transmit over the same spectrum at the same time in the same area, because if they did, they'd cause interference with one another.
And because wireless signals only transmit over a certain distance, you won't be able to tune in a radio station you like that broadcasts out of New York City when you are in Philadelphia or Chicago or anywhere beyond the distance that those broadcast signals can travel via spectrum over the air to your radio.
Mobile phones work much the same way. Wireless operators, such as AT&T and Verizon, cannot transmit wireless signals over the same frequencies in the same markets at the same time.
Page 97 of 188
The Federal Communications Commission is the government agency that keeps track of who's using which slivers of spectrum. The agency grants companies licenses to use the spectrum. In the mobile phone market, the FCC has auctioned off spectrum, generating billions of dollars in revenue for the government.
The FCC also decides which frequencies of spectrum can be used for which purposes. For mobile phones, it has allocated spectrum generally between 700 MHz and 2.6 GHz. Most of the spectrum in this range has already been allocated for use. This means that when a wireless company wants to add more spectrum to its service to boost its capacity, it may well be disappointed: there isn't much more available spectrum that can be used.
Spectrum is the lifeblood of the industry. And as more consumers buy smartphones, which according to the FCC, use 24 times more data than a traditional cell phone, and tablets, which can consume 122 times more data than old traditional phones, there is a greater need for spectrum. The question is, where's it going to come from? Much of the best spectrum for transmitting mobile signals has already been licensed to wireless carriers, or it's being used by TV broadcasters or government agencies, which hold the rights to these licenses. As a result, the industry and the FCC have declared a spectrum shortage.
The FCC is working on ways to free up additional spectrum:
• with other government agencies to hand over spectrum for commercial use. • with TV broadcasters to develop incentive auctions that will allow TV stations to put their unused or underused spectrum up for sale and get a cut of the proceeds. • and in various ways to change the rules for certain blocks of spectrum used for things like satellite communications so that they can be used for mobile broadband services. In the National Broadband Plan presented to Congress in 2010, the agency set a goal of freeing up an additional 500 MHz of spectrum for wireless broadband use by 2020.
But the process to free up additional spectrum has been slow, and it's unclear whether the agency will meet this goal. What's more, many industry insiders believe 500 MHz by 2020 is still not enough spectrum to fuel such a fast-growing industry.
Page 98 of 188 With an essential resource in high demand and low supply, FCC commissioners are also staring at a classic regulators' quandary: When they do auction off this additional spectrum, should they allow the market to sort itself out in the Darwinian sense and allow the spoils to go to the highest bidder? Or do they intercede, in the process protecting small carriers and protecting, in theory, consumer choice? And would it even matter if they did?
These are the questions with which the FCC is currently wrestling. There are no easy answers, but the policies that the agency sets today will have a lasting effect well into the future, whether those policies result in fewer competitors or they help preserve the many wireless competitors that exist today.
Page 99 of 188 Page 100 of 188 PUBLIC NOTICE Federal Communications Commission 445 12th St., S.W. News Media Information 202 / 418-0500 Internet: https://www.fcc.gov Washington, D.C. 20554 TTY: 1-888-835-5322
DA 19-1226 Released: December 2, 2019
FEDERAL COMMUNICATIONS COMMISSION ANNOUNCES 2.5 GHZ RURAL TRIBAL WINDOW AND TECHNICAL WORKSHOP
WT Docket No. 18-120
In July 2019, the Commission modernized the regulatory framework for the 2.5 GHz band to make this vital mid-band spectrum available for advanced wireless services, including 5G. A significant part of this action included establishing a Rural Tribal Priority Window that will provide federally recognized Tribal entities with an opportunity to address the communications needs of their rural communities by applying for unassigned 2.5 GHz spectrum in what was formerly designated as the Educational Broadband Service (EBS).1 By this Public Notice, the Wireless Telecommunications Bureau announces that the Rural Tribal Priority Window will open on Monday, February 3, 2020, and will close on Monday, August 3, 2020. The Commission establishes this 182-day window, coupled with six months of outreach and education that will have preceded the window, to allow eligible Tribes the opportunity to assess their needs, determine if spectrum is available in their communities, and prepare to file their applications.2
The Commission already has begun an extensive outreach program to ensure that all interested, eligible Tribes have the information they need to be able to apply for this spectrum during this window. We have established a dedicated website (www.fcc.gov/RuralTribalWindow) that provides access to information regarding the window, including the location and dates of outreach and education opportunities. We have also created a dedicated mapping tool (https://www.fcc.gov/25-ghz-rural-tribal- maps) to assist Tribes in assessing their eligibility and the amount of unassigned 2.5 GHz spectrum over their Rural Tribal Lands.
As part of its outreach efforts, the Commission will host a workshop at its headquarters in Washington, DC, on January 14, 2020. Further information the Rural Tribal Window, including the specifics about the application filing process, and the upcoming workshop, will be announced and posted to the Rural Tribal Window website on or before January 6, 2020.
Any questions or requests for additional information regarding the Rural Tribal Window can be submitted via email at [email protected] or via phone by calling Cecilia Sulhoff, Wireless Telecommunications Bureau, at (202) 418-0587.
1 Transforming the 2.5 GHz Band, Report and Order, 34 FCC Rcd 5446, 5463-69, paras. 47-65 (2019). 2 The window we adopt today is consistent with requests for an 180-day window. See Letter from Kevin Shendo, Education Director, Pueblo of Jemez, to Marlene H. Dortch, Secretary, Federal Communications Commission, WT Docket No. 18-120 (filed Nov. 20, 2019) at 1 and Attachment (The National Conference of American Indians, Resolution #ABQ-19-86C).
Page 101 of 188 Page 102 of 188 Federal Communications Commission FCC 19-62
Before the Federal Communications Commission Washington, D.C. 20554
In the Matter of ) ) Transforming the 2.5 GHz Band ) WT Docket No. 18-120
REPORT AND ORDER
Adopted: July 10, 2019 Released: July 11, 2019
By the Commission: Chairman Pai and Commissioners O’Rielly and Carr issuing separate statements; Commissioners Rosenworcel and Starks approving in part, dissenting in part and issuing separate statements.
TABLE OF CONTENTS
Heading Paragraph #
I. INTRODUCTION...... 1 II. BACKGROUND...... 4 III. DISCUSSION...... 13 A. Rationalizing Incumbent 2.5 GHz Band Holdings ...... 14 1. Eliminating Eligibility Restrictions...... 15 2. Educational Use Requirements...... 26 3. Eliminating Leasing Restrictions ...... 32 4. Modifying Existing License Areas...... 36 B. Local Priority Filing Windows ...... 45 1. Tribal Priority Window ...... 47 2. Educational Institution Priority Windows...... 66 C. Licensing Areas Containing EBS White Spaces ...... 75 1. Auction of EBS White Space Licenses ...... 75 2. Description of Licenses Being Offered ...... 93 3. Requirements for New 2.5 GHz Licensees ...... 101 4. Dismissal of Pending Waiver Requests...... 113 D. Cleaning up the 2.5 GHz Rules...... 114 E. Effective Date of Rule Changes...... 117 IV. PROCEDURAL MATTERS...... 118 V. ORDERING CLAUSES...... 122 Appendix A—Final Rules Appendix B—Final Regulatory Flexibility Analysis Appendix C—List of Commenters
I. INTRODUCTION 1. Establishing American leadership in the fifth generation of wireless services, or 5G, is critical to our economy, security, and quality of life. 5G networks will be much faster and carry more data than current wireless networks, enabling numerous potential applications, such as telemedicine, smart transportation, and the Internet of Things (IoT). Fostering the development of these applications, as well as innovations that are yet to be imagined, will be critical to future national competitiveness in a multitude of industries. Indeed, according to one study, 5G has the potential to create three million new
Page 103 of 188 Federal Communications Commission FCC 19-62 jobs, $275 billion in private investment, and $500 billion in new economic growth.1 Additionally, 5G applications that are useful in rural areas, such as precision agriculture, may help us to close the digital divide. 2. An essential part of enabling 5G services is making more spectrum available for the commercial marketplace. Spectrum is a critical input for all wireless services, and making additional spectrum available will ensure that wireless providers are able to deploy 5G networks as soon as the technology is ready. With that in mind, the Commission has a comprehensive strategy to make additional high-band,2 mid-band,3 and low-band4 spectrum available. The demand for mid-band spectrum for 5G networks has especially increased in recent years, as more countries have recognized that mid-band spectrum offers favorable characteristics for enabling wireless networks to achieve coverage and capacity. 3. In this Report and Order, we take another step towards implementing the Commission’s strategy by making more mid-band spectrum available. Specifically, we transform the regulatory framework governing the 2.5 GHz band (2496-2690 MHz), which is the single largest band of contiguous spectrum below 3 gigahertz. Too much of this spectrum, which is prime spectrum for next generation mobile operations, including 5G,5 has lain fallow for more than twenty years. That ends today. In order to move this spectrum into the hands of those who will provide service, including 5G, to Americans across the country, and particularly in rural and Tribal areas, we are replacing an outdated regulatory regime, developed in the days when educational TV was the only use envisioned for this spectrum, with one that not only gives incumbent users more flexibility in how they use the spectrum, but also provides opportunities for additional entities to obtain access to unused 2.5 GHz spectrum. Importantly, the reforms we adopt in this Report and Order will make valuable mid-band spectrum available for the mobile services on which consumers increasingly rely and which is critical to maintaining American leadership in the next generation of wireless connectivity. II. BACKGROUND 4. The 2.5 GHz band, which extends from 2496 to 2690 MHz, is comprised of 20 channels designated for Educational Broadband Service (EBS),6 13 channels designated for commercial Broadband Radio Service (BRS), and a number of small guard band channels.7 EBS licensees are authorized to
1 See Accenture Strategy, Smart Cities How 5G Can Help Municipalities Become Vibrant Smart Cities, https://newsroom.accenture.com/content/1101/files/Accenture_5G-Municipalities-Become-Smart-Cities.pdf (last visited May 13, 2019). 2 See, e.g., Use of Spectrum Bands Above 24 GHz For Mobile Radio Services, et al., Fourth Report and Order, 33 FCC Rcd 12168 (2018), Fifth Report and Order, FCC 19-30 (rel. Apr. 15, 2019). 3 See, e.g., Expanding Flexible Use of the 3.7 to 4.2 GHz Band et al., Notice of Proposed Rulemaking and Order, 33 FCC Rcd 6915 (2018). 4 See, e.g., Review of the Commission’s Rules Governing the 896-901/935-940 MHz Band, Notice of Proposed Rulemaking, FCC 19-18 (Mar. 14, 2019). 5 See Amendment of Parts 1, 21, 73, 74 and 101 of the Commission’s Rules to Facilitate the Provision of Fixed and Mobile Broadband Access, Educational and Other Advanced Services in the 2150-2162 and 2500-2690 MHz Bands; Transforming the 2.5 GHz Band, Notice of Proposed Rulemaking, 33 FCC Rcd 4687, 4687-88, para. 1 (2018) (NPRM). 6 See Amendment of Parts 1, 21, 73, 74 and 101 of the Commission’s Rules to Facilitate the Provision of Fixed and Mobile Broadband Access, Educational and Other Advanced Services in the 2150-2162 and 2500-2690 MHz Bands, Report and Order and Further Notice of Proposed Rulemaking, 19 FCC Rcd 14165, 14169-70, para. 6 (2004) (BRS/EBS R&O or BRS/EBS FNPRM). The Instructional Television Fixed Service (ITFS) was an analog television- like service, while EBS is a broadband service. 7 EBS licensees operate in 112.5 megahertz of the 2.5 GHz band, 73.5 megahertz is assigned to BRS, and eight megahertz is assigned to guard band channels.
2
Page 104 of 188 Federal Communications Commission FCC 19-62 operate on the A, B, C, D, and G channel groups,8 with each group comprised of three 5.5 megahertz- wide channels in the lower or upper band segment and one 6 megahertz-wide channel in the middle band segment.9 Currently, there are 1,300 EBS licensees holding 2,193 licenses.10 5. Only specified entities are eligible to hold an EBS license, specifically (1) accredited public and private educational institutions, (2) governmental organizations engaged in the formal education of enrolled students, and (3) nonprofit organizations whose purpose is educational and include providing educational and instructional television materials to accredited institutions and governmental organizations.11 6. Our rules permit EBS licensees to lease their excess capacity to non-educational entities to use for non-educational purposes.12 And most EBS licensees do so. There are 2,087 active leases of EBS spectrum, compared with 2,193 licenses.13 7. There are special requirements applicable to EBS excess capacity leases that do not apply in other services. Because the Commission’s rules require EBS licensees to use their spectrum to further their educational missions,14 any excess capacity lease entered into by an EBS licensee must reserve a minimum of 5% of its spectrum capacity for the licensee/lessor and the licensee must use that capacity to provide 20 hours of educational usage per channel per week.15 Under existing rules, the Commission generally prohibits EBS licensees from leasing their facilities for a term longer than 30 years.16 Also, lessees are required to provide EBS lessors with the opportunity to revisit their lease terms at years 15, 20, and 25 to review their “educational use requirements in light of changes in educational needs, technology, and other relevant factors and to obtain access to such additional services, capacity, support, and/or equipment as the parties shall agree upon in the spectrum leasing arrangement to advance the EBS licensee’s educational mission.”17 Those rules do not apply to leases that were entered into before
8 BRS is assigned the E, F, and H channel groups and BRS 1 and BRS 2. Id. 9 47 CFR § 27.5(i). In addition, a few grandfathered ITFS licensees, whose licenses were issued before 1983, are authorized to operate on the E and F channel groups, but these licensees may not apply for major modifications to their licenses. In 1983, the Commission redesignated the E and F channel groups for use by the Multichannel Distribution Service (MDS). Amendment of Parts 2, 21, 74 and 94 of the Commission’s Rules and Regulations in regard to frequency allocation to the Instructional Television Fixed Service, the Multipoint Distribution Service, and the Private Operational Fixed Microwave Service, Report and Order, 94 FCC 2d 1203, 1206-07, para. 4 (1983) (First Leasing Decision). MDS was renamed BRS, and currently the E, F, and H channel groups are assigned to BRS. See BRS/EBS R&O, 19 FCC Rcd at 14183-84, paras. 37-38; see also Amendment of Parts 21, 43, 74, 78, and 94 of the Commission's Rules Governing Use of the Frequencies in the 2.1 and 2.5 GHz Bands Affecting: Private Operational-Fixed Microwave Service, Multipoint Distribution Service, Multichannel Multipoint Distribution Service, Instructional Television Fixed Service, & Cable Television Relay Service, Order on Reconsideration, 6 FCC Rcd 6792, 6794, para. 9 (1991), recon. denied, 7 FCC Rcd 5648 (1992) (OFS Order). 10 These numbers are based on a review of the Universal Licensing System conducted on May 13, 2019. 11 47 CFR § 27.1201(a). The entity also must be “otherwise qualified under the statutory provisions of the Communications Act of 1934, as amended.” Id. EBS licenses are held by state government agencies, state universities and university systems, public community and technical colleges, private universities and colleges, public elementary and secondary school districts, private schools (including Catholic school systems and other religious schools), public television and radio stations, hospitals and hospital associations, and other non-profit educational entities. The listed entities we identified are based on a review of the Universal Licensing System conducted on May 13, 2019. 12 47 CFR § 27.1214. 13 Based on a review of the Universal Licensing System conducted on May 13, 2019. A station may have multiple leases associated with it, so the number of licenses that are leased out is slightly smaller. 14 47 CFR § 27.1203. 15 47 CFR § 27.1214.
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January 10, 2005; such leases were grandfathered under the previous ITFS rules, which allowed a term of no more than fifteen years. 8. EBS presents two special challenges which are largely not present in other bands: a long- standing failure to make spectrum available, particularly in rural areas, and an unusual licensing scheme. Incumbent EBS licenses cover only about one half of the geographic area of the United States in any given channel.18 The 2.5 GHz spectrum remains largely unassigned in much of the rest of the country, especially in rural areas west of the Mississippi River.19 9. The Commission suspended the processing of applications for new EBS licenses (and for major changes to existing EBS licenses) in 1993.20 Since then, the Commission has only opened two filing windows for EBS applications—in 1995, for new construction permits and major changes to existing EBS facilities, and in 1996, to allow for the filing of EBS modification applications and amendments to pending EBS applications proposing to co-locate with an authorized wireless cable facility.21 Thus, the last regular opportunity to apply for a new EBS license was in 1995. 10. In general, each EBS license is based on a circular Geographic Service Area (GSA) with a 35-mile radius (with an area of approximately 3,850 square miles). Due to a historical license modification process the Commission adopted in 2005, however, many EBS licenses have much smaller, irregular GSAs. Specifically, many EBS licenses had their 35-mile radius circles reduced when the Commission converted their Protected Service Areas (PSAs) to GSAs through the “splitting-the-football” process.22 11. On May 10, 2018, the Commission released the NPRM in this proceeding that explored ways to make this unused spectrum available for more flexible use to facilitate the deployment of next
(Continued from previous page) 16 BRS/EBS R&O, 19 FCC Rcd at 14233-34, paras. 177-181. 17 47 CFR § 27.1214(e). With respect to pre-2005 grandfathered leases, which have a maximum term of 15 years, the Commission has given guidance on how to interpret the 15-year limitation to leases which have a start date after the date the lease is signed. Amendment of Parts 1, 21, 73, 74 and 101 of the Commission’s Rules to Facilitate the Provision of Fixed and Mobile Broadband Access, Educational and Other Advanced Services in the 2150-2162 and 2500-2690 MHz Bands, Fifth Memorandum Opinion and Order and Third Further Notice of Proposed Rulemaking, 24 FCC Rcd 12258, 12259-65 paras. 4-16 (2009) (BRS/EBS Fifth MO&O). 18 This estimate is based on a review of the Universal Licensing System conducted on May 13, 2019. 19 Id. 20 See Amendment of Part 74 of the Commission’s Rules with Regard to the Instructional Television Fixed Service, Notice of Proposed Rulemaking, 8 FCC Rcd 1275, 1277, para. 9 (1993). 21 See Notice of Instructional Television Fixed Service Filing Window from October 16, 1995, through October 20, 1995, Public Notice, Report No. 23565A (rel. Aug. 4, 1995); see also Mass Media Bureau Announces Commencement of Sixty (60) Day Period for Filing ITFS Modifications and Amendments Seeking to Co-Locate Facilities with Wireless Cable Operations, Public Notice, 11 FCC Rcd 22422, 22422-23 (1996). 22 BRS/EBS R&O, 19 FCC Rcd at 14192-94, paras. 60-65. “Splitting-the-football” refers to a process initially used informally by licensees in the MDS and ITFS industry to handle interference issues in GSAs that overlap. Id; 47 CFR § 27.1206(a) (“The area for incumbent site-based licensees that is bounded by a circle having a 35 mile radius and centered at the station’s reference coordinates, which was the previous PSA entitled to incumbent licensees prior to January 10, 2005, and is bounded by the chord(s) drawn between intersection points of the licensee’s previous 35- (continued….) 4
Page 106 of 188 Federal Communications Commission FCC 19-62 generation wireless services, including 5G, to all Americans.23 The NPRM proposed to rationalize the geographic service areas of EBS licenses and to provide additional flexibility to current EBS licensees in the use of the spectrum. It also sought comment on opening up priority windows for access to the spectrum by certain groups, such as Tribal Nations; and it proposed to assign the remaining white space through geographic area licenses for commercial use subject to competitive bidding; and sought comment on regulatory requirements for new EBS licensees. 12. The Commission received 304 comments (including express comments) and 29 reply comments on the NPRM.24 III. DISCUSSION 13. To further our goal of ensuring that this fallow spectrum is used to provide high-speed broadband service, particularly in rural areas, we move quickly to assign the remaining spectrum in this band to those who will use it to provide service.25 Specifically, we will hold a Tribal priority window to enable Tribal nations an opportunity to obtain 2.5 GHz licenses to provide service on rural Tribal lands. This window will be followed immediately by a system of competitive bidding for the remaining white spaces. In conjunction with our effort to quickly license the remaining spectrum in this band to entities that will use it, we also will replace the outdated regulatory regime for EBS with one of flexible use, thus making this valuable mid-band spectrum more available for advanced wireless services, including 5G. A. Rationalizing Incumbent 2.5 GHz Band Holdings 14. We take a series of steps to provide existing EBS licensees with additional flexibility. First, in order to provide EBS licensees with additional flexibility and to facilitate the most efficient use of the EBS spectrum through a market-based mechanism, we adopt the NPRM’s proposal to eliminate the EBS eligibility requirements, including for licenses granted via waiver of the filing freeze.26 Second, as part of our efforts to remove unnecessary regulatory barriers and align the EBS licenses with the flexible use policies used in similar spectrum bands, we adopt our proposal in the NPRM to eliminate the educational use requirements for EBS licenses.27 Third, we adopt the NPRM’s proposal to eliminate
(Continued from previous page) mile PSA and those of respective adjacent market, co-channel licensees.”); see also BRS/EBS R&O, 19 FCC Rcd at 14192-94, paras. 60-65; Amendment of Parts 1, 21, 73, 74 and 101 of the Commission’s Rules to Facilitate the Provision of Fixed and Mobile Broadband Access, Educational and Other Advanced Services in the 2150-2162 and 2500-2690 MHz Bands, Order on Reconsideration and Fifth Memorandum Opinion and Order and Third Memorandum Opinion and Order and Second Report and Order, 21 FCC Rcd 5606, 5612, para. 5 n.7 (2006), recon. in part, 23 FCC Rcd 5992 (2008) (BRS/EBS Second R&O). 23 NPRM, 33 FCC Rcd 4687. 24 A list of commenters, reply commenters, and ex parte filings in this proceeding is contained in Appendix C. When citing comments, we will use the short name of the commenter contained in Appendix C, followed by the words “Comments” or “Reply.” Similarly, for ex parte filings, we will use the name of the commenter along with the date the ex parte was filed as listed in ECFS (this date may be different from the date on the actual ex parte letter). 25 On May 13, 2019, SHLB, NACEPF, Mobile Beacon, Voqal, National Digital Inclusion Alliance and Public Knowledge filed a request that the Commission seek further comment and delay a decision in this proceeding. See SHLB, NACEPF, Mobile Beacon, Voqal, National Digital Inclusion Alliance and Public Knowledge May 13 Ex Parte, see also Dept. of Ed. June 7 Ex Parte at 8. Further delay in this proceeding is not warranted. All parties have had ample opportunity to provide information through comments, reply comments, and ex parte presentations. Indeed, SHLB and its partners were free to provide economic analysis and information on educational use at the comment or reply comment stage. The actions we take today were clearly identified in the NPRM. Given the critical need to make additional mid-band spectrum available, it is entirely appropriate to act now. 26 NPRM, 33 FCC Rcd at 4694, paras. 20-21. 27 Specifically, we remove section 27.1203 from our rules.
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Page 107 of 188 Federal Communications Commission FCC 19-62 restrictions on EBS leases entered into under our Secondary Markets policies on a going forward basis. We clarify that nothing in our decisions is intended to affect or change the terms of any private contractual arrangement or any provisions in existing leases. Finally, we decline to adopt the NPRM’s proposal to rationalize incumbent licenses to align with pre-existing geographic areas. 1. Eliminating Eligibility Restrictions 15. As noted by commenters that support elimination of the eligibility restrictions,28 eliminating eligibility restrictions will promote more efficient use of the spectrum,29 improve the industry’s ability to attract capital,30 and make this spectrum more appealing for commercial operators to include in their long term service plans.31 Therefore, once the rules become effective, both incumbent EBS licenses and new EBS licenses once issued will be free of the eligibility restrictions, and EBS licensees may assign or transfer their licenses freely. In taking this step, we better align these licenses with the flexible use licensing policies used in similar spectrum bands, which generally feature open eligibility.32 Moreover, taking this step is also consistent with the Commission’s historical progression of granting increasing flexibility to EBS licensees, which has been an effective means of promoting more efficient use of the 2.5 GHz band.33 16. The circumstances that led to the creation of a dedicated educational service no longer exist. Substantial technological changes over the last 30 years enable any educator with a broadband connection to access a myriad of educational resources—a content distribution model that does not require dedicated educational spectrum licensed to educational institutions.34 Only a handful of EBS licensees have deployed their own networks or use their EBS licenses in a way that requires dedicated spectrum.35 Instead, most licensees rely on lessees to deploy and operate broadband networks and use the leases as a source for revenues or devices.36 Moreover, as noted below, today there are a multiplicity of other sources of educational programming available to institutions with broadband connections. All of these factors support eliminating the eligibility restrictions at this time. 17. We do not believe that eliminating EBS eligibility restrictions will result in negative consequences for the educational community.37 Despite some claims to the contrary, eliminating
28 Bridge the Divide Comments at 5; CCA Comments at 3; Colville Comments at 3; Gallatin Comments at 4; NTCA Comments at 4; NTTA Comments at 3; R Street Institute Comments at 5; Sprint Comments at 9-10 (with a one-year delay); TPI Comments at 1-2; VIYA Comments at 4; WCAI Comments at 15-16; WISPA Comments at 12-13; AT&T Reply at 4. 29 Bridge the Divide Comments at 5; CCA Comments at 3; Gallatin Reply at 4-6. 30 Bridge the Divide Comments at 5; Gallatin Comments at 5-6; WCAI Comments at 16. 31 Bridge the Divide Reply at 2-3. 32 See, e.g., Expanding Flexible Use of the 3.7 to 4.2 GHz Band, Order and Notice of Proposed Rulemaking, 33 FCC Rcd 6915, 6963, para. 145, n.256 (2018); Service Rules for Advanced Wireless Services in the 2000-2020 MHz and 2180-2200 MHz Bands, Report and Order and Order of Proposed Modification, 27 FCC Rcd 16102, 16193, paras. 241-42 (2012); Service Rules for the 698-746, 747-762 and 777-792 MHz Bands, Report and Order, 22 FCC Rcd 15289, 15381, 15383-84 paras. 253, 256 (2007); Allocations and Service Rules for the 71-76 GHz, 81-86 GHz and 92-95 GHz Bands, Report and Order, 18 FCC Rcd 23318, 23346-47, para. 70 (2003). 33 NPRM, 33 FCC Rcd at 4693, para. 19. 34 Bridge the Divide Reply at 2-3; WCAI Comments at 7-8; WISPA Reply at 3-5. 35 WCAI Comments at 16, n.37; WCAI Reply at 15, n.29. 36 Gallatin Comments at 2-3; Gallatin Reply at 1-3. 37 AASA/AESA Comments at 4-6; Adam Miller Comments at 1; AIHEC Comments at 2; APTS-CPB Comments at 5; CA K-12 HSN Comments at 20-21; Chester County Comments at 1; Digital Wish Comments at 3; EBPARC Comments at 9; EBC Comments at 2; Friday Institute Comments at 7; HITN Comments at 5-7; Lawrence County (continued….) 6
Page 108 of 188 Federal Communications Commission FCC 19-62 eligibility requirements will not disrupt existing arrangements.38 Granting incumbent licensees additional flexibility to transfer or assign their licenses will not affect existing leases because: (1) the decision about whether to lease or transfer or assign a license remains with the EBS licensee,39 and (2) our actions in this Report and Order do not affect the validity of existing leases and other contractual arrangements. The services currently provided by EBS licensees will continue uninterrupted, including those provided by Mobile Beacon and Mobile Citizen pursuant to their leases with Sprint,40 unless the parties themselves decide otherwise. We are not persuaded that eliminating the eligibility restrictions will jeopardize the public-private partnerships promoted by the Commission’s leasing rules that have facilitated the construction of networks,41 which have benefitted both the educational institutions and their network partners.42 Providing additional flexibility to incumbent EBS licensees by eliminating the eligibility restrictions will help ensure that the licensee retains control of decisions about how the license is to be used, including decisions about whether, under what terms, and to whom to transfer or assign the license.43 Incumbent EBS licensees that wish to retain their licenses44 and continue participating in public-private partnerships may do so; incumbent EBS licensees that wish to transfer or assign their licenses will now have greater ability to do so. 18. We therefore reject as speculative and unpersuasive the assertions of some commenters that eliminating eligibility restrictions will lead to existing EBS licensees’ losing negotiating leverage and will give commercial entities the incentive and ability to offer licensees unfavorable sale terms rather than new or renewed leases.45 For the same reasons, we reject allegations that permitting transfer or assignment of incumbent EBS licensees will hurt education generally, even if it benefits individual licensees.46 Providing licensees with additional flexibility to transfer or assign their licenses gives them greater power to put the licenses to use in the manner that suits their educational objectives. We expect that incumbent licensees will make decisions about assigning or transferring their licenses based on the best interests of their educational institution.
(Continued from previous page) Comments at 1-2; Mural Net Comments at 4; NDIA Comments at 3; NACEPF Comments at 6-10; Nebraska Comments at 10-11; NEBSA/CTN Comments at 16-18; North Carolina Comments at 6; NAUF Comments at 8-9; NMU Comments at 9-10, PCs for People Comments at 4; Rural EBS Coalition Comments at 4-5; SHLB Comments at 9; South Florida EBS Comments at 3-5; SETDA Comments at 4; TechSoup Global Comments at 3; Utah Comments at 5-6; Voqal Comments at 8-15; EBS Parties Reply at 4; SFL Reply at 1; VOL Reply at 1; Dept. of Ed. June 7 Ex Parte at 3-4. 38 NEBSA/CTN Reply at 8 (raising concerns that existing leases will be negatively impacted). 39 Sprint Comments at 9; Bridge the Divide Reply at 4. 40 Several educational and non-profit entities filed comments describing the importance of the inexpensive, unlimited broadband services provided by Mobile Citizen and Mobile Beacon to their mission. Mobile Beacon and Mobile Citizen are comprised of various incumbent EBS licensees that lease spectrum to Sprint. As part of their lease agreements, Mobile Beacon and Mobile Citizen obtain low-cost, unlimited broadband service, which they provide to educational institutions and other non-profit entities. NACEPF Comments at 15; Voqal Comments at 7. Braswell Memorial Library in Nash County, North Carolina describes the hotspot lending program that it started with assistance from Mobile Beacon, which now makes broadband access available 24/7 to the library’s patrons. Phillip Whitford, Braswell Memorial Library Comments; see also, e.g., Jamie Brambley, Fulton County Library Comments; Jolene Franciskovich Comments; Enoch Kindseth, Normal Public Library Comments; Barbara Laub, Maplewood Public Library Comments; Samantha Milsap, Roselle Public Library District Comments; Victoria Sandin Comments; Ted Stark, Menomonie Public Library Comments Ann Stovall, Indian Prairie Public Library Comments; Stephanie R. Sullivan, Reddick Public Library Comments; Phillip Whitford, Braswell Memorial Library Comments. Teachers also described their reliance on these services. See, e.g., David Asbury Comments (describing reliance of Gadsden City Schools in Gadsden, Alabama on Mobile Beacon’s service); Akiba Byrd Comments (describing reliance on Mobile Citizen to provide affordable high speed internet to its members); Davida Elsbree Comments (describing the reliance of Pathways Charter School on Mobile Beacon’s service); Louise Lee Comments (continued….) 7
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19. Contrary to the concerns of some commenters,47 we do not believe that continuing to apply EBS eligibility restrictions is necessary to ensure that commercial entities meet the needs of underserved communities. Appropriate performance requirements, such as those adopted herein, can ensure that licensees actually use their spectrum to offer service. Moreover, nothing in this proceeding affects the ability of commercial entities to provide broadband to entities eligible for E-Rate funding,48 which is another way to ensure that schools and libraries in underserved communities are provided with broadband access. In addition, those incumbent EBS licensees that retain their licenses can continue to meet the educational and other needs of their communities. Finally, the priority window and competitive bidding mechanisms adopted herein will provide additional opportunities for the deployment of broadband service to rural unserved market areas using 2.5 GHz spectrum. 20. We reject claims that the Commission’s prior decisions to establish ITFS in 1963 and to maintain the eligibility restrictions in 2004 support continuation of the EBS eligibility restriction.49 When the 2.5 GHz band originally was designated for educational use in 1963, there was a demonstrated need for dedicated spectrum for educational television services.50 When, in 2004—three years before the introduction of the smartphone—the Commission decided against revising the eligibility restrictions, the 2.5 GHz band was just beginning a major transition, as it moved from an analog television service to a broadband service accompanied by substantial technical changes.51 In that context, the Commission concluded that it was premature to eliminate the restrictions at that time.52 In contrast, this band now is used primarily for broadband, and it resembles flexible use bands such as the PCS or AWS bands more than it resembles the ITFS band of old.53 Indeed, even the current educational use requirements—to retain 5% of capacity for educational use and to use each channel at least 20 hours per week for educational purposes—have little relevance to the way this band is being used today. In the exercise of our spectrum management responsibilities, we believe that it is more appropriate in these circumstances
(Continued from previous page) (describing the reliance of Butte College in Northern California on Mobile Beacon’s service); Rebecca Evans Comments (describing the reliance of Sanislo Elementary School, in Seattle, Washington on Mobile Beacon’s service). 41 NEBSA/CTN Comments at 3-8; CTNI/METL Reply at 7. 42 HITN Comments at 2-3; EBPARC Reply at 12. For example, CTNI asserts that the ability to lease excess capacity was essential to deployment of a 2.5 GHz network covering 4 million people in the Metropolitan Detroit area, as CTNI’s member institutions did not have the wherewithal to deploy the network on their own. According to CTNI, commercial services are being provided across the area on EBS spectrum, and CTNI and its member institutions have been able to bridge the digital divide and the homework gap, providing broadband access to students at home, for thousands of low-income households. CTNI/METL Reply at 7. 43 Bridge the Divide Reply at 4; WISPA Comments at 12-13. 44 We caution incumbent EBS licensees concerning the eligibility and other requirements of our existing EBS rules, including the licensee’s educational purposes, the provision of educational and instructional television material to accredited institutions and government organizations, the reception and use by receive sites of the licensee’s educational usage, the specific additional obligations of nonlocal applicants, and the minimum 5% reservation of channel capacity. 47 CFR §§ 27.1201(a), 27.1214. Based on recent allegations that several national, non-profit licensees have not complied with the Commission’s eligibility and other rules, see, e.g., Letter from Commissioner Brendan Carr to George Bott, President, Rockne Educational TV (July 3, 2019), we direct the Wireless Telecommunications Bureau and the Enforcement Bureau to investigate such allegations and take appropriate action based on their findings. 45 NEBSA/CTN Oct. 5 Ex Parte at 2-3. 46 NEBSA/CTN Comments at 16-18. 47 CoSN Comments at 2-4; NEBSA/CTN Comments at 17; Friday Institute Reply at 14; CA K-12 HSN Reply at 14; EBPARC Reply at 7-8; NEBSA/CTN Oct. 5 Ex Parte at 2-3. 48 Midco Comments at 13-14; WCAI Reply at 18.
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Page 110 of 188 Federal Communications Commission FCC 19-62 to address the critical shortage of flexible use mid-band spectrum necessary to promote the deployment of wireless broadband devoted to the wide range of 5G uses. 21. Further, we are not persuaded by the economic study submitted on behalf of SHLB in support of maintaining the eligibility requirements, which we find to be premised on an unrealistic deployment model.54 The SHLB Economic Study discusses the services offered by Mobile Citizen and Mobile Beacon pursuant to their agreement with Sprint, as well as those offered by self-deployed EBS networks, and it constructs a framework to measure the economic benefit of retaining eligibility restrictions assuming that educational licensees offer broadband service at $15/month.55 However, as noted previously, most educational licensees have chosen not to deploy their own networks. Indeed, none of the self-deployed educational networks identified by SHLB offer service on a regular basis to the general public at $15/month.56 While economic and social benefits would flow from increased broadband adoption, SHLB has not shown that educators could sustain a broadband system at the $15/month price point they studied.57 Finally, the study in our view does not adequately address the problem of the digital divide. Specifically, while Mobile Citizen and Mobile Beacon offer access at $10/month pursuant to their agreement with Sprint, their associated companies hold EBS spectrum licenses in major and more densely populated markets. We cannot infer from this that new EBS licenses in rural areas would be able to negotiate similar agreements with Sprint or another provider, particularly given the higher cost of deploying mid-band spectrum in rural areas. 22. Further, the SHLB Economic Study claims that the economic and social benefits from assigning the 2.5 GHz spectrum via an overlay auction are less than if the licenses were assigned to educational institutions and/or Tribal nations.58 We disagree. We find that auctioning overlay licenses for remaining white spaces will be a more efficient and effective means of addressing the digital divide,
(Continued from previous page) 49 See, e.g., NACEPF Comments at 7-8; Voqal Reply at 8. Both NACPEF and Voqal cite the 2004 decision, which is a decade-and-a-half old, in BRS/EBS R&O (19 FCC Rcd at 14222, para. 152) as justification to not eliminate the eligibility requirements now. 50 MDS R&O, 39 FCC at 846-847, paras. 1-2. 51 See generally, BRS/EBS R&O, 19 FCC Rcd at 14224-25, paras. 156-157. 52 Id. 53 AASA/AESA requests that the Commission issue a further notice of proposed rulemaking stating what the Commission’s EBS policy is and maps showing the unassigned EBS white space. AASA/AESA Comments at 6,7- 8, 13, 15, and 16. The Commission sees no need to take either action. The NPRM gave clear notice of our contemplated actions, and unassigned EBS white space can be determined based on existing information available in our databases. In addition, no other commenter argues that such additional actions are necessary. Finally, any value in this (unnecessary) additional administrative process is significantly outweighed by the cost of the resulting delay in putting this critical mid-band spectrum to use for the benefit of the public. 54 The Economic Benefit of Keeping the “E” in EBS: A Comparison of Licensing Unassigned EBS to Educators and Nonprofits Vs. Commercial Auctions (filed June 3, 2019) (SHLB Economic Study). 55 See SHLB Economic Study at 42 (Table 4-5).at 22 (Table 2-3). 56 SHLB identifies seven “infrastructure-based” EBS networks. SHLB Economic Study at 22 (Table 2-3). Two of the networks (Havasupai Tribal Council and Nisqually Indian Tribe) are tribal networks that are not relevant here. NMU charges $34.95/month to the general public, $24.95/month for alumni and veterans, and $19.95/month for students. See https://www.nmu.edu/ean/. Kings County charges $30/month for fixed access and $40/month for mobile access, with 50% discounts for students. See https://www.kingscoe.org/domain/45 (Internet Fees, Prepaid Service). Imperial County, California’s network is still in the pilot phase and is seeking donations to support its operations. See https://www.icoe.org/about-icoe/borderlink. It is unclear that the Louisa County, Virginia network is in fact operating. In its most recent filing concerning its special temporary authority, Louisa County reported that it was working to construct its system. See File No. 0008360114, Extension Request (filed Sep. 7, 2018). Finally, based on press reports, Albemarle County’s system is only available to students. See Alison DeNisco, High speed (continued….) 9
Page 111 of 188 Federal Communications Commission FCC 19-62 as new EBS licensees will have both the market incentives and flexibility to pursue the most efficient deployment of this spectrum. We note that the Commission for over a quarter-century has successfully assigned spectrum via auction. It has recognized that spectrum auctions allow market forces to determine the highest and best use of scarce spectrum and the highest value user. The SHLB Economic Study not only fails to recognize the efficiency of spectrum auctions, but it also understates the potential benefits of an overlay auction because its commercial deployment model only considers deployment to entire counties, and it precludes deployment to parts of counties, which would greatly expand the potential scope of commercial deployment after an auction.59 The SHLB Economic Study also fails to consider complementarities that EBS spectrum may have with other spectrum bands. As noted above, the Commission has a comprehensive strategy to make additional high-band, mid-band, and low-band spectrum available, and wireless providers can combine these different bands to better achieve the best 5G coverage and capacity possible. Finally, the SHLB Economic Study is mistaken in concluding that there is no “economic surplus” from an overlay auction because it “would not allow commercial carriers to launch more affordable offerings.”60 Additional spectrum may lower network costs for service providers (e.g., by eliminating the need for cell-splitting), thus leading to more affordable plans for American consumers. 23. In addition, to the extent that SHLB suggests that the Commission impose some sort of rate regulation on new EBS licensees, it fails to consider the disincentive that such a requirement would create to using these licenses to provide broadband service, especially in conjunction with similar bands used for broadband.61 That disincentive would be particularly significant given the fact that today’s networks use a mixture of spectrum bands, and the 2.5 GHz band represents key mid-band spectrum for the deployment of 5G. Indeed, while CTN and NEBSA support the existing eligibility requirements, they do not see the proposal around which the SHLB Economic Study is based as workable.62 To be clear, nothing we adopt today prevents existing EBS licensees from pursuing opportunities with commercial service providers to provide broadband to the public; in fact, our action today allows current EBS licensees flexible use of the full amount of spectrum they hold. Finally, the desire of entities such as Mobile Citizen and Mobile Beacon to expand their broadband service offerings to the general public using 2.5 GHz spectrum underscores the importance of making this spectrum available as quickly as possible. 24. There is no reason why those who hold licenses granted pursuant to waiver of the filing freeze should not have the same rights to transfer or assign or lease their licenses as other incumbent EBS
(Continued from previous page) internet and free internet meet (July 25, 2017), https://districtadministration.com/high-speed-internet-and-free- internet-meet/. 57 We note that the SHLB Economic Study itself questions the nationwide applicability of the $15/month price point. SHLB Economic Study at 37-38. Further, the SHLB Economic Study assumes an educational use requirement of 20%, as well as a local-priority window for educational entities. Id. at 38. We note that the Commission is today eliminating the educational use which further increase the unreliability of the SHLB Economic Study results. 58 See SHLB Economic Study at 8-10. 59 Id. at 32-34. The SHLB Economic Study also precludes any commercial buildout of EBS spectrum in counties with partial coverage, but the SHLB Economic Study itself estimates that these counties have a population of almost 14 million. Id. at 25, Table 3-1. 60 Id. at 9, 51. 61 SHLB Comments at 5. 62 CTN/NEBSA Reply at 8-9.
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Page 112 of 188 Federal Communications Commission FCC 19-62 licensees,63 and thus we will permit those who hold licenses granted pursuant to waiver to freely assign or transfer their licenses. The existence of the filing freeze justified treating these licenses differently at the time they were granted, including subjecting the licenses to significant conditions such as prompt build- out and a prohibition on leasing. Now that these licensees have been operating and providing service in compliance with these conditions, and the filing freeze is being lifted with the upcoming Tribal priority window and competitive bidding opportunity, we see no reason to continue to apply different rules to them.64 25. To effectuate our decision to eliminate the EBS eligibility restriction, we will eliminate existing section 27.1201 of the Commission’s rules. In addition, we will amend our secondary market leasing rules to eliminate the EBS-specific exception to the rule that a lessee must be eligible to hold a license in the service in which it is leasing spectrum.65 Since EBS will now be a service with open eligibility, the exception will no longer be necessary. 2. Educational Use Requirements 26. We find it in the public interest to give licensees flexibility to put 2.5 GHz spectrum to its most efficient use, rather than maintaining or updating outmoded educational use requirements that have not been changed since 1998. Licensees holding licenses in the 2.5 GHz band, whether obtained before or after the adoption of this Report and Order, will not be required to use these licenses to fulfill an educational mission, although they are still permitted to do so. 27. This decision is consistent with our other decisions in this item to increase flexibility and eliminate outdated EBS requirements. The primary purpose of the educational use requirements was to ensure that educational licensees were using the spectrum for educational purposes, in order to “safeguard[] the primary educational purpose of the ITFS spectrum allocation.”66 If we are allowing non- educators to hold licenses directly, it makes little sense to retain these restrictions on spectrum use. Furthermore, we believe that eliminating these requirements is the best means of promoting flexibility, which ultimately will promote the deployment of broadband and allow markets to direct spectrum to its most productive use, for the benefit of educational institutions and all Americans.67 28. As the Commission stated in the NPRM, the educational use requirements have not been updated since 1998 and were based on the use of analog video.68 Circumstances have changed radically since the Commission established ITFS. In 1963, there were very limited means of distributing
63 See, e.g., Colville Comments at 3; Sprint Comments at 9; VIYA Comments at 14. Some Commenters do suggest that licenses granted via waiver should not have the same rights. EBS Comments at 2; Nez Perce Comments at 3. As discussed above, we disagree. 64 Some commenters assert that the EBS application filing freeze, and not EBS eligibility restrictions, is the main cause of the inefficient use of EBS spectrum. CoSN Comments at 2-4; EBPARC Comments at 9-10; NEBSA/CTN Comments at 3-8. Without question, the EBS filing freeze contributed to underuse of the EBS band in some locations. By our actions in this item, including eliminating eligibility restrictions and education use requirements, establishing a priority filing window for new licenses for rural Tribal lands, and determining to assign the remaining unassigned frequencies through competitive bidding, we are providing a path forward to remedy this longstanding situation. However, the fact remains that with limited exception, most EBS licensees lease their spectrum to commercial operators, and meet their educational requirements providing services that do not require dedicated EBS spectrum. 65 See 47 CFR §§ 1.9020(d)(2), 1.9030(d)(2). 66 See Amendment of Parts 21 and 74 to Enable Multipoint Distribution Service and Instructional Television Fixed Service Licensees to Engage in Fixed Two-Way Transmissions, Report and Order, 13 FCC Rcd 19112, 19158, para. 89 (1998), modified by Report and Order on Reconsideration, 14 FCC Rcd 12764 (1999) (Two-Way Order). 67 See R Street Institute Comments at 5-6. 68 NPRM, 33 FCC Rcd at 4694, para. 22.
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Page 113 of 188 Federal Communications Commission FCC 19-62 educational programming to students, and a dedicated means of distributing such programming made sense. Now, as WCAI notes, “broadband gives all educators—not just those lucky enough to be EBS licensees—the ability to provide access to educational materials to whomever they choose.”69 The Internet is a far more prevalent and efficient mechanism for distributing content. T-Mobile compares the efficiency of Internet video streaming (for live events) or the downloading of compressed video files (for recorded material) over generic broadband digital connections versus using dedicated video transmissions.70 Furthermore, educators also use broadband to communicate with peers, collaborate across platforms, and research.71 Moreover, most current EBS licensees have abandoned use of EBS as a closed, dedicated means of distributing educational content. Today, the educational use of the 2.5 GHz band has become indistinguishable from the commercial broadband service offered by the commercial lessee,72 with most EBS licensees or their commercial lessees providing digital broadband service, offered 24/7, at the school itself, at home, or anywhere within the licensee’s GSA.73 Even if there were a rationale for maintaining the educational use requirements in the absence of eligibility restrictions, we see no workable set of requirements in this record. Commenters recommend that the Commission adopt a large and diverse set of potential requirements, ranging from new metrics differentiated by institution size to certification requirements to price mandates.74 29. But the alternative educational use requirements proposed by commenters would neither facilitate broadband deployment nor be workable for licensees or commercial operators. Requiring a commercial operator to designate a fixed percentage of capacity for educational use is not an appropriate requirement when it is not clear how much capacity future networks will have or how much capacity most educational institutions will need or be able to use.75 Similarly, imposing rate regulation on new EBS licensees offering broadband service to consumers likely would create a disincentive to providing broadband service and would establish a regulatory requirement that would make it more difficult to use the band in conjunction with similar bands used for broadband.76 There is a large difference between the voluntary partnership entities such as Mobile Citizen and Mobile Beacon have negotiated to facilitate discounted broadband access and a regulatory mandate that would be a form of price control. We also agree with NEBSA/CTN that it is difficult to see how such a requirement would be defined and enforced.77 30. We are sensitive to the concerns raised by Sprint and NEBSA/CTN that any changes we make not disrupt any existing leases. We clarify that nothing in our decision to remove the educational use requirement is intended to affect or change the terms of any private contractual arrangement or any provisions in existing leases that may provide a licensee with airtime, equipment, or capacity. In other words, if a lease negotiated under the old rules provides that a licensee shall receive services or equipment from a lessee, our decision does not change or nullify the provisions of that lease. 31. Finally, we disagree with NACEPF that the educational use requirements are one of the
69 WCAI Comments at 8. 70 T-Mobile Comments at 3. 71 Id. 72 WISPA Comments at 13. 73 NPRM, 33 FCC Rcd at 4694, para. 22. 74 See, e.g., HITN Reply at 5-6; Sprint Reply at 7-8; SHLB Comments at 5; NACEPF Comments at 4, 28-34; Voqal Comments at 15; Dept. of Ed. June 7 Ex Parte at 4-5. 75 NACEPF Comments at 4, 28-34; see also Voqal Comments at 16. 76 SHLB Comments at 5. 77 NEBSA/CTN Reply at 9.
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Page 114 of 188 Federal Communications Commission FCC 19-62 few tools the Commission has that can address the homework gap.78 There are many other spectrum bands that educators may use if they do not have access to 2.5 GHz spectrum, such as 5 GHz Wi-Fi or General Authorized Access in the 3.5 GHz CBRS band, and as mentioned above, commercial services developed using licensed spectrum are broadly deployed (certainly more so than services relying on current EBS spectrum).79 In addition, the Commission has for years focused on providing connectivity to millions of students and library patrons through its E-Rate program. 3. Eliminating Leasing Restrictions 32. Given our decision to eliminate eligibility requirements, and the fact that broadband is the predominant use of the EBS band, we see no value in maintaining special lease restrictions that only apply to EBS. Eliminating the leasing restrictions that only apply to EBS licenses will make the rules for the 2.5 GHz band consistent with other Wireless Radio Services,80 incentivize build-out in rural areas and provide additional flexibility to both EBS licensees and lessees to enter into mutually beneficial arrangements. 33. We agree with commenters81 that argue that these lease restrictions are unique to EBS82 and that they constrain commercial operations and deter investment, particularly in rural areas.83 We concur with VIYA that, if eligibility restrictions are eliminated, the restrictions on lease terms serve no purpose.84 34. We acknowledge that many educational institutions oppose eliminating restrictions on lease terms, with a split between educational institutions that support the current leasing rules and those that want to impose additional restrictions on leasing. Supporters of the current leasing rules argue that the lease term limitations allow educational institutions to review their leases periodically in light of changing needs and technology.85 In contrast, Educational Broadband Corp. (EBC) urges the Commission to eliminate lease terms that transfer too much control to the lessee,86 while Havasupai and Utah would prohibit leasing to commercial providers so that use of the spectrum can be focused on education.87 We agree with those commenters arguing that our actions should not harm or invalidate existing leases, and we emphasize that nothing in this Report and Order is intended to invalidate existing lease provisions. Leases are a form of contract, and the parties retain the ability to exercise their rights under state contract law. Indeed, there is broad agreement among both educational institutions and commercial providers that the Commission should not take any action to invalidate or harm existing leases. As HITN writes, “[b]oth commercial lessees and educational lessors, have invested in services
78 NACEPF Comments at 3-4. 79 See WCAI Reply at 19-20. We decline to consider WCAI’s recommendation that we consider ways to reform or clarify rules outside the scope of this proceeding. See WCAI Reply at 18-19. 80 See 47 CFR §§ 1.9020, 1.9030. 81 Colville Comments at 4; Gallatin Comments at 6; Nez Perce Comments at 3 (supports elimination of leasing restrictions only if tied to build-out requirements); Sprint Comments at 8; VIYA Comments at 13; WCAI Comments at 21-22; WISPA Comments at 13; NTTA Reply at 3. 82 WISPA Comments at 13. 83 WCAI Comments at 21-22. See also Gallatin Comments at 5-6 (lease restrictions "restrain or chill the ability of commercial lessees to plan for, develop and implement business plans that depend on long term full availability of the spectrum"). 84 VIYA Comments at 13. 85 EBPARC Comments at 6; NEBSA/CTN Comments at 19-20; Voqal Reply at 16-18. 86 EBC Comments at 2. 87 Havasupai Comments at 3; Utah Comments at 9.
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Page 115 of 188 Federal Communications Commission FCC 19-62 and equipment, in substantial reliance on the negotiated terms of their existing leases, and the Commission should make no rule changes that would interfere with or substantially alter such contractual rights and obligations.”88 WCAI and Sprint take a similar view.89 To the extent some argue for additional restrictions on leasing, we find that such additional restrictions would be inconsistent with our goals of promoting broadband deployment using EBS spectrum and maximizing flexibility for EBS licensees. 35. We therefore eliminate section 27.1214 of the Commission’s rules, except for subsection (d).90 In addition, we will eliminate section 1.9047, which is a cross-reference in the secondary market rules to section 27.1214. 4. Modifying Existing License Areas 36. To ensure that the fallow spectrum in this band is made available for use quickly, we have decided to leave existing license boundaries for incumbent 2.5 GHz licenses intact, rather than imposing a complex and protracted rationalization process on incumbents. In the NPRM, the Commission proposed to rationalize the current point-and-radius license areas held by incumbents to a defined geographic area and sought comment on a number of issues related to this proposal.91 Upon review of the record, however, and in light of the unique circumstances posed by licensing of this 2.5 GHz band as discussed below, we find that engaging in the complex, and potentially confusing process of rationalizing current licenses to a geographic area (such as counties or census tracts) would delay making the white spaces available in this band and would not likely result in the potential benefits explored in the NPRM. 37. With regard to the NPRM’s proposal to modify each existing license to include all of the census tracts covered by each current geographic service area,92 we are persuaded by opponents’ argument that census tract-based rationalization would not necessarily result in more easily-determined license boundaries and therefore would not facilitate service by either existing licensees or new entrants.93 As the EBC and other commenters point out, any method of assigning census tracts to incumbents is likely to leave license areas with edges like “saw teeth”—irregular zig-zagging lines with frequent, small protrusions.94 Given the propagation characteristics of the 2.5 GHz band, it would be difficult to provide services to these areas as a technical matter,95 and this difficulty may result in significant degradation of service near market boundaries, as each licensee decreased power in order to remain within power limits, resulting in lower signal strength and lower service quality in the area.96 This issue does not arise to the
88 HITN Comments at 4. See also NAUF Comments at 8; NEBSA/CTN Reply at 7; NMU Comments at 9-10; South Florida EBS Comments at 8; University of Cincinnati Reply at 1 (expressing concern that rule changes could nullify its lease agreement with Sprint); Voqal Comments at 6; VOL Reply at 1. 89 See WCAI Comments at 30 (“The Commission should very clearly state that leases entered into prior to the effective date of any new rules pursuant to this proceeding should continue to be enforceable in the courts according to their terms for the duration of the lease (including any renewal terms.”); Sprint Reply at 6-7. 90 We will retain current section (d) concerning grandfathering of pre-2005 leases. 91 NPRM, 33 FCC Rcd at 4692, paras. 10-11. 92 Id. at 4692, para. 11. 93 See AASA/AESA Comments at 12-13; Bridge the Divide Comments at 3-4; EBC Comments at 1-2; Havasupai Comments at 4; HITN Comments at 4-5; NCTA Comments at 2-3; South Florida EBS Comments at 9-10; Sprint Comments at 4-5; Voqal Comments at 17-18; WISPA Comments at 8-9; EBPARC Reply at 10-11; WCAI Reply at 10. 94 EBC Comments at 1-2; HITN Comments at 4-5; South Florida EBS Comments at 9-10; Sprint Comments at 4-5; WCAI Reply at 10; WISPA Reply at 8. 95 See AASA/AESA Comments at 9-11; Bridge the Divide Comments at 3-4; Havasupai Comments at 4; WCAI Comments at 13-14; EBPARC Reply at 10-11. 96 See South Florida EBS Comments at 9-10.
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Page 116 of 188 Federal Communications Commission FCC 19-62 same degree with the current license areas, as their smooth, circular contours are more consistent with signal propagation patterns.97 In addition, any problems caused by these irregular boundaries necessarily also would affect the white space available for licensing subject to competitive bidding, at the borders between incumbents and new entrants. Because the potential for operational problems far outweighs the small potential for improvement in the regularity of the resulting white space, we therefore decline to adopt a census tract-based rationalization scheme. 38. We also reject the proposal by commenters to expand existing GSAs to include the counties covered by or that intersect the geographic service area, based on a coverage threshold determined by the percentage of the geographic area of the county covered by the licensee.98 While the Commission has recognized the benefits of adopting county-based licensing in other bands,99 we decline to adopt a county boundary-based rationalization scheme for incumbents in the 2.5 GHz band for several reasons. First, we are concerned about the potential for some licensees to receive a much larger GSA, with no corresponding requirement to provide service in the expanded area. For example, San Bernardino County, the largest county in the United States, covers over 20,000 square miles, compared to the maximum incumbent license area of approximately 3,850 square miles.100 Since we are not applying updated performance requirements to existing EBS licenses, there is no guarantee that existing licensees would use the expanded area.101 Alternatively, were we to adopt NACEPF’s suggestion to expand incumbents’ licenses to county boundaries subject to additional build-out requirements, incumbents with no interest in serving additional geographic areas, especially in very large counties, could ultimately lose their entire license based on a failure to expand service.102 39. Second, implementing county-based expansion in situations with multiple incumbent licenses in the same county raises complex issues that likely reduce significantly the benefits of county expansion. To handle such situations, several commenters suggest “splitting the football,”103 the methodology that the Commission previously employed in this band to address the issue of overlapping circular GSAs104 or alternative methods to deal with multiple incumbents expanding into the same
97 See AASA/AESA Comments at 12-13. 98 APTS-CPB Comments at 5-6; AT&T Comments at 6; Bridge the Divide Comments at 3-4; CA K-12 HSN Comments at 20; CCA Comments at 2-3; Chickasaw Nation Comments at 7; EBC Comments at 1-2; Gallatin Comments at 3-4; HITN Comments at 4-5; Maria Hadden Comments at 1; Midco Comments at 9; NACEPF Comments at 34-35; NMU Comments at 6; NCTA Comments at 2-3; South Florida EBS Comments at 9-10; Sprint Comments at 4-5; Voqal Comments at 17-18; WCAI Comments at 10; WISPA Comments at 8-9; EBPARC Reply at 8; EBS Parties Reply at 2-3; Friday Institute Reply at 7-8; CTNI/MTEL Reply at 8-9; NEBSA/CTN Reply at 4; NTUA/Mescalero Reply at 3; Views on Learning Reply at 1. 99 See, e.g., Promoting Investment in the 3550-3700 MHz Band; Report and Order; GN Docket No. 17-258, at paras.19-41 (rel. Oct. 24, 2018); Use of Spectrum Bands Above 24 GHz For Mobile Radio Services et al., Report and Order and Further Notice of Proposed Rulemaking, 31 FCC Rcd 8014, 8029, para. 35 (2016) (Spectrum Frontiers R&O). 100 2018 U.S. Gazetteer Files, census.gov, last accessed February 28, 2019. The area of a circle with a 35-mile radius, the basis for incumbent GSAs, is approximately 3,848 square miles. 101 See part III.D.6 infra. 102 See NACEPF April 25, 1019 Ex Parte at 15-16. Incumbents would have the option to partition their license and return the undesired portion to the Commission, but this would leave the county with irregular license boundaries, destroying the claimed benefit of county expansion in the first place. 103 Bridge the Divide Comments at 3-4; EBC Comments at 1; South Florida EBS Comments at 9-10; WISPA Comments at 9; EBS Parties Reply at 2-3. 104 See supra n. 22.
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Page 117 of 188 Federal Communications Commission FCC 19-62 county.105 While “splitting the football,” or using a similar method to establish a border between multiple incumbents expanding into the same county, might be equitable for current licensees, it would not result in regular, mappable license areas based on geographic boundaries. The resulting borders would not correspond to any official boundaries or natural features; instead, they could only be calculated by referencing the previous license areas—either the “point” of the point-and-radius GSA, or the edge of the previously-calculated circle—neither of which would be immediately visible after rationalization. All of the problems cited by commenters, including the difficulty of administering these arbitrary license areas in ULS, would persist. CA K-12 HSN’s suggestion of splitting counties by spectrum is also problematic.106 Wider channel width is important for many advanced wireless applications, including 5G, and dividing spectrum among multiple incumbents may reduce its usefulness significantly. 40. Third, using a percentage threshold based on existing geographic area coverage of a county relative to the total area of the county limits the amount of rationalization that actually takes place. Commenters originally proposed a wide array of threshold levels of geographic coverage within a county that an incumbent licensee would be required to meet to qualify for expansion to the county’s boundaries, including 10%,107 20%,108 30%,109 35%,110 or 80%111 of the geographic area of the license. Sprint, WISPA, MidCo, WCAI, CTN, NEBSA, Voqal, and NACEPF subsequently agreed on using a 25% threshold.112 To the extent the Commission adopted any threshold for county-based expansion, however, many incumbent licenses would remain at least partially “un-rationalized,” because if the GSA is in more than one county (as many are), some sections of the license would expand to county borders and some sections of the license would not expand to county borders, but rather would remain bounded by the circle arc.113 Counties with un-rationalized license sections still would be subject to all the problems and continuing coverage gaps cited in the record. In addition, as WCAI notes, expanding licenses to county boundaries in some cases, while leaving vestigial circle arcs in other counties, with respect to the same GSA license, would result in “significant confusion as to what areas are white space,” as well as “exacerbat[ing] the [current] problem by adding a second, geographic area-based approach.”114 41. Although some commenters point to certain alleged advantages of county-based rationalization, including eliminating coverage gaps between current license areas115 better aligning
105 Gallatin suggests setting the border along census tract lines. Gallatin Comments at 3-4. CA K-12 HSN advocates for giving all incumbents the full geographic area of the county but dividing the spectrum. CA K-12 HSN Comments at 20. The Nez Perce proposed dividing overly large counties along natural features, such as rivers (Nez Perce Comments at 7-8), while the Friday Institute advocates capping expansion of any incumbent at 1,0000 square miles to limit windfall situations. Friday Institute Reply at 7-8. 106 See CA K-12 HSN Comments at 20. 107 Gallatin Comments at 3-4; Sprint Comments at 5; NEBSA/CTN Reply at 4-5; Voqal Reply at 23-24. 108 EBPARC Reply at 8. 109 Friday Institute Reply at 7-8. 110 WISPA Comments at 9. 111 Midco Comments at 10. 112 See Sprint/MidCo/WISPA/WCAI/CTN/NEBSA/Voqal/NACEPF/Mobile Beacon June 14 Ex Parte. 113 As an example, the license for Station WND283 covers all or portions of 14 different counties. The GSA completely covers three of those 14 counties. Depending on the threshold established, the GSA could remain as an irregular area in up to nine of the counties. 114 WCAI Reply at 12-13. See also Bridge the Divide Reply at 2. 115 APTS-CPB Comments at 5-6; HITN Comments at 4-5; NMU Comments at 6; WCAI Comments at 12; Voqal Reply at 22.
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Page 118 of 188 Federal Communications Commission FCC 19-62 licenses with typical school districts,116 and other claimed advantages,117 we conclude that the problems associated with county-based rationalization outlined above outweigh any of these potential benefits. NACEPF also mentions faster 5G deployment in the 2.5 GHz band as a benefit of county expansion, primarily due to the resulting increase in the license areas available to Sprint.118 While Sprint supports county-based rationalization,119 it does not make any commitments to deploy in expanded license areas. 42. We also reject other alternative rationalization schemes suggested by commenters, such as self-defined GSAs,120 GSAs based on granular population data,121 or GSAs that vary from state to state based on local school district size.122 Those methods of rationalizing licenses would be both unpredictable and difficult to implement. We also reject rationalization of existing EBS licenses to “correspond with the geographic areas where existing licensees currently provide service,”123 because such an approach: (1) would take years to implement, as it would require an extensive analysis of where service was being provided, (2) would be prone to litigation, and (3) would be inconsistent with the goal of quickly getting unused spectrum into the hands of those who will provide service, including 5G, to Americans across the country. 43. Similarly, any of the rationalization schemes described in the NPRM or suggested by commenters would require considerable time to implement and would have to be completed before any auction of remaining spectrum could take place. In addition to the necessary changes to the licensing system, the process of resolving whether the required threshold had been met and dealing with situations where multiple incumbents met the threshold would be complex. Adding a complicated and lengthy rationalization process before the auction could delay the deployment of 2.5 GHz services in currently unlicensed areas. In the interest of expeditiously moving this important mid-band spectrum into the hands of those best able to develop it, we conclude that the likelihood of considerable delay for such a limited result is not in the public interest. 44. Given the complications and drawbacks inherent in all the rationalization schemes proposed in the record with respect to licensing of this band, we decline to adopt any of the proposals. Instead, we conclude that the best mechanism of putting unassigned spectrum to use as quickly and efficiently as possible is to offer overlay licenses subject to competitive bidding. Such an overlay license approach also addresses any concerns regarding irregular gaps between license areas, allowing overlay licensees to take existing EBS license contours into account when bidding for such license.124
116 Bridge the Divide Comments at 3-4; CA K-12 HSN Comments at 20; South Florida EBS Comments at 9-10; Dept. of Ed. June 7 Ex Parte at 5. 117 The other claimed advantages include increase the regularity of remaining white space (EBC Comments at 1-2), promoting easier market entry for prospective new licensees (APTS-CPB Comments at 5-6), clarifying coverage areas for consumers (CCA Comments at 2-3; WCAI Comments at 10; Bridge the Divide Reply at 1-2), reducing time to auction and speeding deployment (CCA Comments at 2-3; Maria Hadden Comments at 1; NACEPF Comments at 53), providing consistency with newly auctioned licenses (Midco Comments at 7; NCTA Comments at 2-3; South Florida EBS Comments at 9-10; WCAI Comments at 13-14), and better fitting the technical realities of providing service in the 2.5 GHz band (NCTA Comments at 2-3; WCAI Comments at 13-14; Bridge the Divide Reply at 1-2). 118 NACEPF April 25 Ex Parte at 6-7, 11, 13. 119 Sprint Comments at 4-8; Sprint Reply at 6. 120 Havasupai Comments at 4. 121 Nez Perce Comments at 2. 122 Dept. of Ed. June 7 Ex Parte at 5. 123 Charter Comments at 2. 124 APTS-CPB Comments at 5-6; NMU Comments at 6.
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B. Local Priority Filing Windows 45. In the NPRM, the Commission proposed to use geographic area licensing to assign the remaining unassigned portions of the 2.5 GHz band. 125 Envisioning that these geographic licenses would be assigned by auction,126 the Commission also sought comment on whether it first should open up to three priority filing windows to give Tribal Nations, other non-licensee educational institutions, and existing licensees an opportunity to file applications for 2.5 GHz licenses to serve their local communities, in advance of any auction for these frequencies.127 The Commission explained that, in each filing window, qualifying applicants would have the opportunity to apply for one or more vacant channels of EBS spectrum in areas where the applicant can demonstrate that it has a local presence.128 46. In this Report and Order, we adopt a priority window for Tribal Nations to obtain access to the 2.5 GHz band on rural Tribal lands. The priority window will operate as an overlay license, with Tribal priority window applicants obtaining geographic area licenses subject to protecting incumbent operations within the relevant geographic area.129 We decline to adopt priority windows for non- incumbent educational institutions or incumbent licensees. 1. Tribal Priority Window 47. We find that adoption of a Tribal priority window for Tribal entities to obtain EBS licenses on Tribal lands that are located in rural areas is in the public interest. Consistent with the Commission’s suggestion in the NPRM, we conclude that opening a priority filing window for rural Tribal Nations will provide Tribal Nations with an opportunity to obtain unassigned EBS spectrum to address the communications needs of their communities and of residents on rural Tribal lands, including the deployment of advanced wireless services to unserved or underserved areas.130 The Commission has recognized that “members of federally-recognized American Indian Tribes and Alaska Native Villages and other residents of Tribal lands have lacked meaningful access to wired and wireless communications services.”131 The EBS spectrum offers sufficient bandwidth to give rural Tribal entities an opportunity to provide broadband wireless service.132 As proposed in the NPRM, applicants in the Tribal priority window will be able to acquire all available EBS spectrum on their rural Tribal lands.133 48. Our decision to adopt a Tribal priority window finds broad support in the record, including from many Tribal and Tribal-related commenters, who argue that opening a priority filing window for Tribal Nations would provide rural Tribal Nations with a way to obtain spectrum that could
125 NPRM, 33 FCC Rcd at 4695, para. 25. 126 Id. 127 Id. 128 Id. at 4696, para. 27. 129 See section C.1, infra. 130 NPRM, 33 FCC Rcd at 4698, para. 35. 131 Id. (citing Improving Communications Services for Tribal Nations by Promoting Greater Utilization of Spectrum over Tribal Lands, Notice of Proposed Rulemaking, 26 FCC Rcd 2623, 2624, para. 1 (2011)); see also Inquiry Concerning Deployment of Advanced Telecommunications Capability to All Americans In a Reasonable and Timely Fashion, 2018 Broadband Deployment Report, 33 FCC Rcd 1660, 1662, 1687-88, paras. 6, 57-58 (2018) (2018 Broadband Deployment Report) (noting that Tribal lands continue to lag behind with respect to broadband deployment). 132 Mural Net suggests Tribal licensees will need channels to cover 20 megahertz of contiguous bandwidth. Mural Net Reply at 2. Several Tribal entities express support for making all EBS channels available on Tribal lands available to Tribal applicants. See Ak-Chin Comments at 1; Chemehuevi Comments at 1; Colville Comments at 9; Pueblo de Cochiti Reply at 2; Santa Fe Indian School Reply at 2. 133 NPRM, 33 FCC Rcd at 4699, para. 38.
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Page 120 of 188 Federal Communications Commission FCC 19-62 be used to provide needed advanced wireless and broadband services.134 In addition, those commenters who support local priority filing windows in general also support a Tribal priority window.135 Even among commenters who oppose local priority windows in general136 WCAI acknowledges a need for a Tribal priority window.137 We disagree with MidCo’s assertion that priority windows would “not further any national policy objectives”138 because, as explained above, a Tribal priority window would facilitate access to high-speed broadband, including 5G, on rural Tribal lands. 49. Eligibility. As proposed in the NPRM, eligibility for the Tribal priority window will be limited to federally-recognized American Indian Tribes and Alaska Native Villages on rural Tribal lands.139 As of September 24, 2018, there were 573 federally-recognized Indian tribes.140 Federally- recognized Tribes have a government-to-government relationship with the United States and are eligible to receive certain protections, services, and benefits by virtue of their federally-recognized status.141 While the Commission’s rules with respect to Tribal eligibility in various contexts vary somewhat, they universally limit eligibility to those Tribes that are “federally-recognized,”142 so we will do so with respect to the Tribal priority window. 50. We will extend eligibility in the Tribal priority window to communications providers and other entities that provide communications and other services, provided that that they are owned and controlled by federally-recognized Tribes or a consortium of such Tribes.143 To permit these entities to be eligible to hold EBS licenses and use those licenses to provide broadband service on rural Tribal lands, we will permit those entities and others that are owned and controlled by a federally-recognized Tribe or a consortium of federally-recognized Tribes to participate in the Tribal filing window and to hold EBS licensees.144 AIHEC requests that the 38 Tribal Colleges and Universities (TCUs) be classified as eligible to apply for available EBS spectrum.145 To the extent TCUs or other educational entities146 are owned and controlled by a federally-recognized Tribe or a consortium of federally-recognized Tribes as well as the other requirements we establish for participation, they would also qualify as applicants in the Tribal
134 Bad River Comments at 1 (arguing that the Commission should “ensure that this mechanism will provide Tribes and their members with the meaningful access to spectrum that has long been lacking in Tribal areas, and take steps to facilitate access to 2.5 GHz spectrum for Tribes whose lands are covered, but not served by existing licensees.”); NTTA Reply at 3 (asserting that “the Tribal nation priority window could help certain Tribal Nations obtain access to spectrum for the purposes of serving their members.”). 135 See, e.g., APT-CPB Comments at 6; Bridge the Divide Comments at 7-8; CA K12 HSN Comments at 24; CTNI/METC Comments at 7; EBPARC Comments at 10-11; NTCA Comments at 4, n.7; SHLB Comments at 7; South Florida EBS Comments at 10; University of Cincinnati Comments at 1; NACEPF Reply at 21; Rural EBS Coalition Reply at 7; Voqal Reply at 26-27; NEBSA/CTN Oct. 5 Ex Parte at 2. 136 See MidCo March 5 Ex Parte at 5. 137 WCAI Comments at 18, n.42, 25, n.61 (suggesting limiting Tribal windows to Tribal Nations on Tribal Lands and limiting use to purely non-commercial purposes). 138 MidCo March 5 Ex Parte at 5. 139 NPRM, 33 FCC Rcd at 4695-96, para. 36. 140 U.S. General Accountability Office, Tribal Broadband: FCC Should Undertake Effort to Better Promote Tribal Access to Spectrum, GAO-19-75, at 1, n.1 (Nov. 2018). 141 Id. 142 See, e.g., 47 CFR § 54.5 (definition of Tribal Lands); id. § 73.7000 (definition of tribe); id.§ 1.2110(f)(3)(i) (definition of Qualifying tribal land). 143 Bad River Comments at 5, n.9; Chickasaw Nation Comments at 2; Coeur D’Alene Tribe Comments at 1; NTUA/Mescalero Reply at 6-7; NTTA Reply at 1. 144 Specifically, the provider must be more than 50% owned by one or more federally recognized Tribal Nations or Tribal consortia and actually controlled by one or more federally recognized Tribal Nations or Tribal consortia.
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Page 121 of 188 Federal Communications Commission FCC 19-62 priority window. 51. Tribal Lands. For purposes of the Tribal filing window, we adopt the broad definition of Tribal lands contained in our Part 54 rules.147 We do so because, in both the Universal Service and EBS contexts, the Commission is assisting Tribes in obtaining necessary communications services. We decline to adopt the part 73 definitions proposed by some commenters148 because broadcast definitions were adopted to permit comparison between non-commercial educators applying for broadcast stations, while the Part 54 definition has a similar purpose to the Tribal priority window, to encourage provision of broadband service on rural lands. 52. We will include in the Tribal priority window Tribal lands on-reservation in all situations and off-reservation lands in certain situations. Consistent with the Commission’s ongoing effort to close the digital divide on rural Tribal lands, the purpose of this filing window is to provide broadband access to Tribal lands that historically have been unserved or underserved. It is important to ensure that entities acquiring spectrum in this window will use it to meet the needs of Tribal members. 53. In the NPRM, the Commission requested comment on the appropriate geographic area for such licenses and whether county-based or census tract based license areas might be appropriate.149 While some commenters support county-based or census tract-based licensing for Tribal entities,150 most Tribal entities favor a geographic license area that tracks reservation boundaries.151 In addition, some Tribal entities have members who don’t reside on a reservation, but live beyond the boundaries of Tribal lands on off-reservation lands.152 In addition, some federally-recognized tribes do not have reservations at all.153 These commenters ask that we include in this priority window licenses that cover “counties bordering the licensees’ reservations”154 or counties in which Tribal lands cover some minimum percentage of a county (such as 10%).155 54. We agree with commenters that including off-reservation lands in the Tribal priority window can help promote our goal of facilitating access to wireless service to underserved Tribal populations, and that the Commission must define eligible off-reservation lands in a way that promotes this goal. With respect to including off-reservation land in the Tribal priority window, the Havasupai propose that Tribal entities be licensed on an “ad hoc” basis using a variety of criteria such as: the services to be provided, the location of the target recipients, the amount of EBS spectrum that will be used to provide the service, the broadcast or distribution capabilities of the applicant, and the percentage of the target population that will be served by the proposed size of the service area.156 The Chickasaw Nation (Continued from previous page) 145 AIHEC Comments at 1-2. 146 Ak-Chin Comments at 2; Chemehuevi Comments at 2. 147 See 47 CFR § 54.5. 148 NCAI Comments at 3. 149 NPRM, 33 FCC Rcd at 4699, para. 37. 150 NTUA/Mescalero Comments at 3-4, n.3. 151 Ak-Chin Comments at 1; AIHEC Comments at 2; Chemehuevi Comments at 1; Coeur D’Alene Tribe Comments at 1; Mural Net Comments at 2; Pueblo de Cochiti Reply at 2. 152 Bad River Comments at 6 (describing that many of their Tribal members live in and attend schools in communities outside of the boundaries of the Tribal lands); Colville Comments at 8. 153 Chickasaw Nation/Trace Fiber Networks Oct. 5 Ex Parte at 2 (explaining that the Chickasaw Nation does not have a reservation). 154 Bad River Comments at 6; NTUA/Mescalero Reply at 3-4, n.3; Pueblo de Cochiti Reply at 2. 155 NTUA/Mescalero Reply at 5-6. 156 Havasupai Comments at 4.
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Page 122 of 188 Federal Communications Commission FCC 19-62 suggest that the service area should be based on whether a “portion of the Tribe’s population will be served by licensing that proposed” service area.157 Instead of relying on the “ad-hoc” processes proposed by Tribes, we will rely on an existing Commission process and designate off-reservation Tribal lands as eligible for the Tribal priority window if they have already been designated (as of the adoption date of this Report and Order) as Tribal lands pursuant to the designation process contained in section 54.412 of the universal service rules.158 We find that using the existing process would be efficient and facilitate prompt processing of Tribal priority applications. We find that limiting eligible off-reservation lands as of the adoption date of this Report and Order will provide certainty to Tribal applicants and facilitate administration of the Tribal priority window. 55. While Midco may be correct that, in some cases, “irregularly shaped” reservation-based Tribal lands will complicate the geographic landscape for EBS licenses awarded through competitive bidding,159 we do not see this potential complication as a reason not to make all reservation lands available for the Tribal priority window. EBS licensees that acquire their licenses through competitive bidding will have to protect existing EBS licensees, many of which already have irregularly shaped geographic service areas. More importantly, we find that the need to provide Tribal lands with broadband service outweighs this additional complexity. 56. Rural. To be included in the Tribal priority window, we adopt the proposal from the NPRM that, in addition to being designated as Tribal Lands, an area must also be rural.160 We understand that not all Tribes are located in areas that are considered rural and that by limiting eligibility to rural Tribal lands, some tribes may be excluded from the window.161 However, as the Commission has previously made clear, bringing broadband access to rural Americans is critical to providing them with the same economic, employment, education and civic opportunities that people in urban areas enjoy.162 Because the problem of access to wireless communications services is most acute in rural areas, and because the purpose of the Tribal priority window should be to promote service to areas that are currently unserved or underserved,163 we believe that limiting this priority window to rural Tribal lands will provide the most effective and targeted way to achieve the Commission’s goal of closing the digital divide in Tribal lands. 57. First, we are not persuaded by the objections raised to limiting the Tribal priority window to rural areas. For example, we disagree with the assertion that such a limitation is inconsistent with the “federal government’s trust relationship with Indian tribes,” as that relationship is not limited to rural areas.164 The Commission is committed to honoring its trust relationship with Tribal Nations through, among other things, policies facilitating broadband deployment on Tribal lands. Individual policies
157 Chickasaw Nation Comments at 7. The Chickasaw Nation also suggests that the Commission should not put “unnecessary restrictions” on the definition of Tribal lands and should include lands that are not inhabited by Tribal members or lands held by private citizens. Chickasaw Nation Reply at 2, n.6. 158 47 CFR § 54.412. 159 Midco March 5 Ex Parte at 5. 160 NPRM, 33 FCC Rcd at 4698-99, para. 36. 161 NCAI Comments at 3; NTUA/Mescalero Reply at 4-5; Pueblo de Cochiti Reply at 2; Santa Fe Indian School Reply at 2. While NTUA/Mescalero supports the proposed definition of rural, they do not support limiting eligibility to rural Tribal lands. NTUA/Mescalero Reply at 4-5. 162 Connect America Fund ETC Annual Reports and Certifications Establishing Just and Reasonable Rates for Local Exchange Carriers Developing a Unified Intercarrier Compensation Regime, Report and Order, Further Notice of Proposed Rulemaking, Order on Reconsideration, FCC 18-176, at 2, para. 2 (rel. Dec. 13, 2018). 163 Havasupai Comments at 3 (suggesting that the window only be “available to tribal governments that are not already served by broadband). 164 NCAI Comments at 3; NPM Comments at 2; Pueblo de Cochiti Reply at 2; Santa Fe Indian School Reply at 2.
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Page 123 of 188 Federal Communications Commission FCC 19-62 tailored to specific deployment issues, such as increasing access to spectrum over unserved rural areas, positively contribute to this overall effort. Nor are we persuaded that limiting access to rural areas will reduce flexibility for Tribal Nations to use this spectrum, create definitional uncertainty for Tribal Nations, or create separate classes of Tribal governments, which is inconsistent with the intent of Congress.165 Priority window applicants seeking access to 2.5 GHz spectrum on rural Tribal lands will not be limited in how they use the spectrum; rather they will have the same flexibility as other licensees. Since we are adopting an objective definition of what land will be considered rural, Tribes will be able to determine whether the lands for which they seek licenses are eligible for this window and make the appropriate demonstration. 58. We are, however, persuaded that, in establishing what constitutes rural Tribal lands for purposes of a Tribal priority window, we should set a population limit that is higher than the one we proposed in the NPRM. Although in the NPRM we proposed using the definition of rural Tribal lands from the E-rate and Lifeline programs: i.e., Tribal Lands that are not part of “an urbanized area or urban cluster area with a population equal to or greater than 25,000,”166 we note that, as the Chickasaw Nation asserts, some clusters within historically rural Tribal lands have populations very close to or perhaps just over 25,000.167 We therefore adopt the proposed definition but modify the population threshold for an urbanized area or urban cluster from 25,000 to 50,000. Therefore, Tribal lands will be considered rural if they are not part of an urbanized area or urban cluster area with a population equal to or greater than 50,000. In this specific instance, we find that using the population threshold of 50,000 will provide certainty to Tribes in bona fide rural areas that they can take advantage of the Tribal priority window while ensuring that the Tribal priority window is appropriately targeted and limited. Some commenters suggest other definitions of rural for the Tribal priority window.168 We find that by focusing on areas that are not part of urbanized clusters, as the Commission does in the E-rate and Lifeline programs, we will best target those areas that are most difficult to serve and are therefore likely in greatest need of high- speed broadband service. We find that using this population limit is consistent with our goal of targeting underserved and unserved Tribal areas. 59. Local Presence. We adopt the NPRM’s proposal to require that all applicants for the Tribal priority window have a local presence in any area for which they apply.169 We believe Tribal entities with a local presence better understand the needs of their communities and are better able to serve those needs. Further, there is no opposition to this proposal with respect to Tribal entities, and thus, we will require applicants for the Tribal priority window to demonstrate that they have a local presence in the Tribal land area for which they seek licenses. 60. Timing. To ensure that federally-recognized Tribes have access to the maximum amount of unassigned EBS spectrum available on rural Tribal lands, we will open the Tribal priority window before we make unassigned EBS spectrum generally available to all entities through competitive bidding.170 61. Procedures. While few commenters address the application process for the Tribal
165 NCAI Comments at 3; Pueblo de Cochiti Reply at 2; Santa Fe Indian School Reply at 2. 166 NPRM, 33 FCC Rcd at 4698-99, para. 36; see 47 CFR § 54.505(b)(3). 167 Chickasaw Nation March 26 Ex Parte at 3-4. 168 Havasupai Comments at 3 (arguing that rural places should be defined by their distance from urban centers and not by population density because some Reservation communities are small and densely populated). 169 NPRM, 33 FCC Rcd at 4696-97, paras. 29-31; see section III.C.2, infra. 170 Ak-Chin Comments at 1; Bad River Comments at 5-6; Chemehuevi Comments at 1; Chickasaw Nation Comments at 5-7; Colville Comments at 4-5; Havasupai Comments at 3; Mural Net Comments at 2; NCAI Comments at 3; Nez Perce Comments at 1; NPM Comments at 1; NTTA Reply at 5; Pueblo de Cochiti Reply at 2; Santa Fe Indian School Reply at 2.
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Page 124 of 188 Federal Communications Commission FCC 19-62 window, several Tribal entities propose a 90-day notice period prior to the opening of the priority filing window with a 60-day window for the filing of applications.171 In accordance with the process we use for competitive bidding172 and with our notice and comment requirements, we direct the Wireless Telecommunications Bureau to announce procedures for the Tribal priority window through one or more Public Notices and other appropriate outreach to potentially eligible Tribal applicants. 62. We reject Colville’s suggestion that the Commission rank applicants eligible for the Tribal window based on a “tribe’s reservation size and location, with the largest, most sparsely populated, and currently least ‘wired’ reservations receiving top priority.”173 We do not believe it necessary to rank Tribal eligibility. We find it unlikely that applications filed in the Tribal priority window will be mutually exclusive in light of our criteria requiring that: (1) Tribal applicants be federally-recognized; (2) the area to be licensed be based on a Tribe’s reservation or qualified off-reservation lands; (3) the area be rural; and (4) the Tribe have a local presence. To the extent that we do receive mutually exclusive applications, we are required by statute to subject such applications to competitive bidding.174 63. Other Issues. Because we are eliminating the educational use requirements for EBS spectrum generally, 175 we find that it would make little sense to apply those requirements to new Tribal licensees. To that end, we will not impose educational use requirements on the EBS spectrum available in the Tribal filing window. 64. Consistent with our general decision to eliminate leasing restrictions generally for EBS licenses, we will not impose such restrictions on Tribal licensees’ ability to lease spectrum to third parties. According to certain Tribal commenters, doing otherwise might “impede the Commission’s goal of timely and efficient build out in rural areas.”176 Tribal entities may not have the “know-how or resources to build out a broadband network” and leasing will increase the likelihood that the spectrum is “used for its highest and best use.”177 In addition, the Tribes should be able to lease unused spectrum to “bring in much needed revenue.”178 Although we are generally eliminating restrictions on assignment and transfer of existing EBS licenses,179 we believe it necessary to impose some restrictions on assignment and transfers of licenses acquired in the Tribal priority window.180 Because proponents of the Tribal priority window have indicated an urgent need for the spectrum to provide service to underserved tribal
171 Ak-Chin Comments at 2; Chemehuevi Indian Tribe Comments at 2; Colville Comments at 10 (also suggesting that notice period be extended for 60 days based upon Tribal request); Mural Net Comments at 4; Nez Perce Comments at 6; Pueblo de Cochiti Reply at 3; Santa Fe Indian School Reply at 3. But see MuralNet May 24 Ex Parte at 2 (proposing a twelve month rolling window). 172 See, e.g., Use of Spectrum Bands Above 24 GHz For Mobile Radio Services, Fourth Report and Order, FCC 18- 180, at 4, para. 10 (Dec. 12, 2018). “As in the prior broadcast television spectrum incentive auction, and in all Commission auctions, we will develop and detail all the procedures necessary to implement our decisions in a pre- auction process framed by an Auction Comment Public Notice and Auction Procedures Public Notice;” Creation of Interstitial 12.5 Kilohertz Channels in the 800 MHz Band Between 809-817/854-862 MHz, Report and Order, FCC 18-143, at 15, paras. 59-60 (Oct. 22, 2018). 173 Colville Comments at 4-5. 174 See para. 75, infra. 175 See section A.2A.2, supra. 176 Chickasaw Nation Comments at 7-8. 177 Id. at 8. 178 NTTA Reply at 6. 179 See section A.3A.3, supra. 180 NPRM, 33 FCC Rcd at 4701-02, para. 47 (asking “Should we require the licensee to demonstrate completion of certain buildout requirements before allowing a transfer of control?”).
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Page 125 of 188 Federal Communications Commission FCC 19-62 communities, we believe it is appropriate to limit, and will accordingly restrict, Tribal licensees’ ability to assign or transfer their licenses until after they have met the build-out requirements applicable to these licenses.181 65. The Tribal window will include only unassigned EBS spectrum. We reject suggestions from several Tribal commenters that we permit Tribal entities to apply for already-licensed spectrum.182 Not only would such an action be beyond the scope of the NPRM, but it also would have a substantial effect on existing licenses that are in compliance with our rules. However, since licenses granted to Tribal entities will be overlay licenses, if an incumbent license that covers rural Tribal lands is cancelled or terminated, any spectrum that becomes available over time will revert to the Tribal licensee. Similarly, Tribal licensees are authorized to lease, partition, or disaggregate their spectrum, including in areas in or near rural Tribal lands. We do not require that incumbent licensees do so, but we encourage those who have holdings covering, or adjacent to, rural Tribal lands to work cooperatively with new Tribal licensees to facilitate deployment of needed service to these areas. 2. Educational Institution Priority Windows 66. We decline to establish a priority filing window for educational institutions, either for educational institutions that do not currently hold EBS licenses or for existing licensees.183 Adopting a priority window restricted to educational institutions would be at odds with our other decisions to provide greater flexibility for more providers to make use of the 2.5 GHz band to offer high-speed broadband service to the public. Given our experience with service deployment to date in EBS, with the vast majority of licensees leasing their spectrum to commercial providers, we believe that making the unassigned EBS spectrum available for flexible use is the best way of getting broadband service deployed to the public more quickly and extensively. While we understand the desire of certain educational institutions to gain additional access to spectrum, our decision is guided by the goal of facilitating broadband deployment and spectrum use, and perpetuating an outdated regulatory regime in this band will not further this goal.184 67. If we adopted a priority window open to all educational institutions, it is highly likely that the Commission will receive mutually exclusive applications.185 Commenters have identified circumstances that raise substantial doubts about the legal authority of certain EBS licensees, particularly public school districts and local governments, to participate in a spectrum auction.186 Specifically, commenters claim that a number of states (approximately 36) have adopted Dillon’s Rule,187 which
181 Nez Perce Comments at 6 (proposing that tribal entities not be permitted to assign their licenses). 182 Several Tribal commenters suggest that we should revoke licenses or mandate disaggregation of spectrum from incumbent EBS licensees with spectrum covering Tribal lands, or that we otherwise should force them to provide service to the Tribal lands or give their spectrum to the Tribal entity. Bad River asks us for a clarification that EBS licenses can be disaggregated. Bad River Comments at 7, n.12. As section 27.15 permits disaggregation for EBS licenses, such clarification is not necessary. However, nothing in that rule mandates such disaggregation. Bad River Comments at 6-7; Chickasaw Nation Reply at 3; Mural Net Comments at 4; Nez Perce Comments at 3, 5; Pueblo de Cochiti Reply at 2; Santa Fe Indian School Reply at 2. Colville asks that the Commission reassign incumbent EBS licenses that are not being used by the incumbent licensee and make them available for application during the filing window. Colville Comments at 5. 183 Although we refer to educational institutions, in this section, the term can also include other entities that are described in current 47 CFR § 27.1201. 184 NEBSA/CTN Comments at 8; EBPARC Comments at 4; NAUF Comments at 3; Voqal Comments at 5; Dept. of Ed. June 7 Ex Parte at 6-7. 185 NEBSA/CTN Comments at 11-12; WCAI Comments at 27-29. 186 See AASA/AESA Comments at 15. See also discussion at para. 84, infra. 187 AASA/AESA Comments at 15; see also Comments of AASA, Docket 03-66 at 10 (filed Sep.22, 2008).
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Page 126 of 188 Federal Communications Commission FCC 19-62 provides that a municipality may exercise only those powers expressly conferred by statute, necessarily or fairly implied by the expressed power in the statute, or essential and not merely convenient.188 Applied to the auction situation, Dillon’s Rule may limit the ability of many municipal educational entities, including counties and school districts that hold EBS licenses, from participating in an auction. We note that no commenter has attempted to show that Dillon’s Rule is not an impediment to auction participation. 68. Those problems become important because, under section 309(j) of the Communications Act of 1934, as amended, if mutually exclusive EBS applications are accepted for filing, we must use competitive bidding to resolve the mutual exclusivity.189 Educational institutions propose various workarounds to address that issue, including using a first-come, first-served filing system,190 placing strict limits on the number of channels an applicant can apply for,191 forcing applicants to form consortia,192 or basing license grants on the number of enrolled students in a service area.193 These proposals are inconsistent either with the Communications Act’s requirement that the Commission use competitive bidding to resolve mutually exclusive applications194 or with the public interest test applicable to alternatives that avoid mutual exclusivity.195 Placing strict limits on the number of channels for which an educational institution could apply could constrain severely the capacity any individual educational institution could provide.196 Finally, choosing between mutually exclusive applicants on a basis other than competitive bidding or requiring applicants that have applied individually to form a joint venture or consortium is plainly inconsistent with the requirement to use competitive bidding.197 69. Although EBPARC argues that the use of priority filing windows would quickly put EBS spectrum in the hands of schools and local operator partners that are eager and ready to build out, we do not see a way to avoid the receipt of mutually exclusive applications.198 And even though SETDA touts the ability of certain educational institutions to provide broadband to unserved and underserved areas, these limited identified examples, among the thousands of EBS licensees, do not persuade us to establish a priority window for all educational institutions. Given the time and effort and delay that would be
188 See Matthew Sellers, County Authority: A State by State Report at 6, 204-5 (Dec. 2010), http://www.nvnaco.org/wp-content/uploads/County-Authority-a-State-by-State-Report.pdf. 189 See NPRM, 33 FCC Rcd at 4701, para. 45. 190 Amelia Academy Comments at 2; CSN Comments at 6; EBS Parties Comments at 3; Hackett School District Comments at 2; Lawrence County Comments at 2; NEBSA/CTN Comments at 13-14; South Florida EBS Comments at 10-11, n.16; Voqal Comments at 21. 191 NEBSA/CTN Comments at 12. 192 AASA/AESA Comments at 17; SHLB Comments at 10. 193 AASA/AESA Comments at 17. 194 47 U.S.C. § 309(j)(1). 195 47 U.S.C. § 309(j)(6)(e). Voqal, NACEPF, and Mobile Beacon incorrectly accuse the Commission of misinterpreting and failing to comply with Section 309(j). See Voqal, et al. July 3 Ex Parte at 2. We have reviewed the alternatives suggested by parties that would avoid mutual exclusivity and find that they would not comply with the public interest test of 47 U.S.C. § 309(j)(6)(e). 196 For example, while NEBSA and CTN propose that applicants apply for only two channel groups (NEBSA/CTN Comments at 12), it has been the experience of NMU and Kings County that they need access to all EBS channels to meet demand for robust broadband service. See Kings County Comments at 6-8; NMU Comments at 8. 197 We note that API has requested that the Commission provide a filing window for critical infrastructure and allow preemptory use of the 2.5 GHz spectrum in certain emergency situations related to oil and gas disasters. API Comments at 3-4. As we determine herein, open eligibility is the best option for assigning unassigned EBS spectrum. API has not demonstrated a critical need for this spectrum and API’s members are free to participate in the auction of overlay licenses that we will conduct. See section C, infra. 198 EBPARC April 30 Ex Parte.
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Page 127 of 188 Federal Communications Commission FCC 19-62 involved in establishing and running the priority window, and the likelihood that such a window for all educational institutions would result in having to auction the spectrum anyway, we find that moving directly to flexible use and open eligibility would be the most expeditious method of making spectrum available to provide broadband service in rural and underserved areas, consistent with our statutory objective to ensure “the development and rapid deployment of new technologies, products, and services for the benefit of the public, including those residing in rural areas, without administrative or judicial delays. . . .”199 We find that the advantages to the public of making critical mid-band spectrum available for flexible commercial use on a prompt basis far outweigh the detriment to those educational institutions. 70. We recognize that some institutions have a desire to provide broadband service to rural, underserved areas. In establishing a priority window for Tribal entities—sovereign nations seeking to bring broadband service to the members of their Tribal Nations but which historically have not had access to such spectrum—but declining to establish a new priority window for educational institutions, we are exercising our considered judgment about which proposals will most effectively and expeditiously achieve our statutory obligations and objectives.200 We believe the Tribal priority window will be a more focused solution than an educational window, since Tribal entities will have a clear incentive to target areas lacking broadband, and Tribes must already work with providers that want to deploy broadband on rural Tribal lands. 71. The Commission has noted that Tribal lands, in comparison to comparable non-Tribal lands (including in rural areas), frequently have characteristics that increase the cost of entry and reduce the profitability of providing service, including cultural and language barriers, a lack of existing infrastructure, and a predominance of low-income residential customers rather than business subscribers.201 A recent report to Congress on broadband coverage on Tribal lands recognized that there is a considerable gap between Tribal lands and non-Tribal areas in terms of population covered by mobile LTE service.202 Further, the report noted that people residing on Tribal lands currently have access to fewer providers that offer 4G LTE coverage.203 In contrast, the fact that a small fraction of educational institutions might be positioned to provide broadband service in rural areas is not a sufficient basis for establishing a general priority window for all eligible educational institutions. 72. Thus, in the context of the federally-recognized Tribes’ unique status, their relationship of trust with the Commission, and their right to set their own communications policies, as well as the unique and significant obstacles to offering service in Tribal areas and the fact that they have not previously had access to this spectrum, we conclude that they have an interest in obtaining additional 2.5 GHz spectrum that is greater than and distinguishable from the interests of educational entities. Beyond Tribal areas, we believe that auctioning overlay licenses for remaining white spaces will be a more effective means of addressing the digital divide. Specifically, new EBS licensees will have market incentives to provide service and will also be required to meet new performance requirements. 73. We also note most rural Tribal lands areas will likely be associated with a single Tribal entity, whereas many localities have a wide variety of educational institutions that could have a local presence. Accordingly, a Tribal priority window is less likely to trigger mutual exclusivity in a significant number of license areas than a priority window for educational institutions (or a priority window that includes Tribal entities and educational institutions).
199 47 U.S.C. § 309(j)(3)(A). 200 See, e.g., 47 U.S.C. 309(j)(3). 201 Connect American Fund, Report and Order, WC Docket 10-90, paras. 2-3 (2018); 202 Report on Broadband Deployment in Indian Country, Pursuant to the Repack Airwaves Yielding Better Access for Users of Modern Services Act of 2018, at 2 (May 2019). 203 Id.
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74. We also do not adopt a priority window for existing licensees. We decline to open a priority window for existing licensees to expand to county boundaries for many of the same reasons that we decline to expand those licensees’ footprints to census tract or county boundaries; we expect that such a window would be needlessly complicated and delay the deployment of critical mid-band spectrum. Existing licensees have already had the opportunity to avail themselves of the benefits of EBS spectrum. For this reason, we reject the recommendations of Bridge the Divide and EBC to open a window for incumbent EBS licensees.204 C. Licensing Areas Containing EBS White Spaces 1. Auction of EBS White Space Licenses 75. As proposed in the NPRM, any remaining unassigned EBS spectrum will be made available for commercial use via competitive bidding immediately following the completion of the Tribal priority filing window.205 Section 309(j) generally requires the Commission to employ competitive bidding to award licenses when mutually exclusive applications have been accepted for filing.206 With the elimination of the eligibility and educational use requirements, the potential for mutually exclusive applications for unassigned EBS spectrum should increase dramatically. While commenters have suggested various ways to avoid mutual exclusivity, in this case, we find that accepting mutually exclusive applications and using competitive bidding to resolve the mutual exclusivity is the best way to assign spectrum quickly and efficiently for its highest-valued use.207 Commercial operators strongly support competitive bidding for unassigned EBS spectrum.208 76. We are not persuaded by the educational community’s concerns about the use of competitive bidding for unassigned EBS spectrum.209 First, we reject claims that assigning licenses by auction will lead to the abandonment of educational services and a worsening of the digital divide.210 To
204 Bridge the Divide Comments at 5 (permit existing licenses to add channel blocks); EBC Comments at 3 (permit existing licensees to expand into adjacent counties). 205 NPRM, 33 FCC Rcd at 4702, 4705, paras. 49, 61. 206 47 U.S.C. § 309(j)(1). 207 See, e.g., FCC National Broadband Plan, at 5 (Mar. 17, 2010), https://www.fcc.gov/general/national-broadband- plan (“Auctions for public spectrum promoted competitive wireless markets, prompting continual upgrades that first delivered mobile phones and, now, mobile broadband.”); id. at 81 (“Congress enabled the FCC to develop procedures for assigning hundreds of megahertz more quickly and efficiently by providing the Commission with auction authority in 1993.”); Expanding the Economic and Innovation Opportunities of Spectrum Though Incentive Auctions, Report and Order, 29 FCC Rcd 6567, 6570, para. 2 (2014) (“Our central objective in designing this incentive auction is to harness the economics of demand for spectrum in order to allow market forces to determine its highest and best use.”) (Incentive Auction R&O). 208 AT&T Comments at 5-6; CCA Comments at 4; Gallatin Comments at 9 (suggesting unassigned white space be repurposed as BRS and put into an “ordinary” auction); Midco Comments at 17; NTCA Comments at 5-6; R Street Comments at 11; Sprint Comments at 10-12; Verizon Comments at 5; WCAI Comments at 18-25; WISPA Comments at iv, 14-17. 209 See, e.g., AASA/AESA Comments at 15; CA K-12 HSN Comments at 21; Colville Comments at 1; CoSN Comments at 6; NACEPF Comments at 49-53; NAUF Comments at 8; Nebraska Comments at 13; NEBSA/CTN Comments at 12; North Carolina Comments at 5; SETDA Comments at 9; SHLB Comments at 3; Voqal Comments at 25-26; Chickasaw Nation Reply at 2-4 (opposing an auction but stating that if the Commission must auction the spectrum, it should provide “heightened deference” to Tribal entities on Tribal lands); EBS Parties Reply at 3-4; Friday Institute Reply at 7; Rural EBS Coalition Reply at 2-3. Some educational commenters do not oppose competitive bidding, provided that it occurs after any priority filing window(s). EBPARC Reply at 3-5; Select Spectrum Comments at 4; South Florida EBS Comments at 11. 210 CoSN Comments at 6 (if market forces were sufficient, this connectivity problem would not exist in so many rural and other hard to serve areas”); CTNI/METL Comments at 8 (if the spectrum is auctioned to commercial (continued….) 27
Page 129 of 188 Federal Communications Commission FCC 19-62 the contrary, we believe this approach is far more likely to deliver value to educational institutions and to help close the digital divide than the status quo, in which EBS spectrum either has lain fallow or has generally not been used for the purpose of providing educational services. We find that assigning licenses by auction will not displace or impair existing incumbent licenses or leases, nor will the assignment of overlay licenses impair existing services, since new 2.5 GHz licensees will be required to protect existing incumbent operators from harmful interference. Nothing in this Report and Order requires incumbent licensees to abandon their current educational use or to change how they use their spectrum. Finally, we find that entities that acquire their licenses by auction will have an incentive to provide services to address the digital divide because all new EBS licensees will have to meet the performance requirements that we establish in this Report and Order in markets that they acquire. Licensees, whether incumbent or new, can provide any services the market requires, without limitation. 77. Auction of Overlay Licenses. To make the unlicensed EBS spectrum as attractive as possible to potential entrants, while protecting the rights of incumbent EBS licensees and their lessees, we conclude that offering geographic overlay licenses that are subject to competitive bidding in those markets where white spaces (i.e., spectrum that is not associated with an active license) exist is the best mechanism for assigning this spectrum. With overlay licenses, the licensees obtain the rights to geographic area licenses “overlaid” on top of the existing incumbent licenses. As with an ordinary flexible use license, the overlay licensee may operate anywhere within its geographic area, subject to protecting the licensed areas (i.e., GSAs) of incumbent licensees. If an incumbent licensee in a county cancels or terminates its license, the overlay licensee obtains the rights to operate in the geographic area and on the channel of the cancelled license.211 An overlay licensee may clear its geographic area by purchasing the incumbent licenses, but it does not have the exclusive right to negotiate with the incumbent licensee for its spectrum rights or to purchase an incumbent license in the geographic area in which it has the overlay rights.212 An auction of overlay licenses would make the unassigned EBS spectrum available expeditiously to potential bidders and would provide a mechanism for those bidders to acquire additional spectrum usage rights within their geographic area when and if an incumbent licensee desires to make its spectrum available. For these reasons, we believe that assigning overlay licenses for vacant and available EBS spectrum by competitive bidding is the best method for assigning such spectrum, because it will maximize the potential for expansion, without disrupting existing licensees and lessees.213
(Continued from previous page) entities, they will not build where service is needed most); NACEPF Comments at 50-51 (“an incentive auction would also reduce educational use by drawing licenses away from existing educational licensees to commercial users that are less invested in the educational mission”); South Florida EBS Comments at 12 (an “incentive auction would actively promote the abandonment of educational services on this band as well as the bridging of the digital divide achieved from such services”); Voqal Reply at 33. 211 Sprint Comments at 12; see also Amendment of Part 90 of the Commission’s Rules to Facilitate Future Development of SMR Systems in the 800 MHz Frequency Band; Implementation of Sections 3(n) and 322 of the Communications Act Regulatory Treatment of Mobile Services; Implementation of Section 309(j) of the Communications Act – Competitive Bidding, First Report and Order, Eighth Report and Order, and Second Further Notice of Proposed Rulemaking, 11 FCC Rcd 1463, 1469, para. 3 (1995) (giving EA licensees the right to use any spectrum within the EA block that is recovered by the Commission from an incumbent SMR licensee in the event of termination of the incumbent’s license); TPI Comments at 4. 212 TPI Comments at 4. 213 AT&T suggests that the Commission hold two separate auctions for EBS spectrum: an incentive auction for licensed spectrum and a regular auction for unassigned white space licenses; this would allow bidders to “assemble spectrum from the combined pool of assigned and unassigned EBS licenses (via coincident and coordinated regular and incentive auctions), which would induce greater carrier participation and more vigorous bidding.” AT&T Comments at 5-6 (emphasis original). For the reasons discussed in this item, we do not believe that an incentive auction would be a viable alternative for the EBS spectrum.
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78. It does not make sense to limit the auction to licenses covering only unlicensed EBS spectrum. Given the large number of existing incumbent EBS geographic service areas, that is 35-mile radius circles, there may not be enough vacant and available EBS spectrum in many markets to encourage competition for those markets in an auction limited to these white space areas. As noted in the NPRM, in many markets all that is available are “small, irregularly shaped areas between GSAs.”214 Another factor that may affect interest in licenses that are not overlay licenses, but rather cover vacant and available spectrum only is that, although the total available geographic area of the EBS vacant and available spectrum might be substantial (50%), the percentage of population covered by the vacant and available (slightly over 15%)215 may not be. 79. Another distinguishing characteristic of the EBS band is the preponderance of leasing by existing EBS incumbent licensees. While there are 2,193 active, regular EBS licenses, there are 2,046 long-term de facto control leases involving EBS licenses.216 The majority of those leases are with Sprint, but there are other lessees in the 2.5 GHz band.217 These leases are authorized to have terms of up to 30 years218 and often contain rights of first refusal or purchase options.219 While one commenter appears to suggest that we consider terminating EBS leases to facilitate transition of the band,220 we continue to believe that such an action would serve as an undue deterrent to the negotiation of spectrum leasing, in this as well as other bands, “thus creating uncertainty among all parties that have entered into or are contemplating agreements under our Secondary Markets rules and policies.”221 Thus, we must consider the impact of those leases on a potential auction. 80. We are not persuaded by the objections raised in the record to offering overlay licenses at auction. For example, there is no evidence in the record supporting the allegation that the winning bidders would be motivated “to undermine existing EBS licenses serving the area, in order to obtain access to that EBS spectrum under the overlay license without having to lease it.”222 Moreover, incumbent EBS licensees will retain control over their licenses and the right to protection from interference from the operations of overlay licensees, their lessees, and other successors in interest. 81. Nor are we persuaded by alleged disadvantages of overlay licensees. For example, Voqal asserts that in many, particularly urban and suburban, markets, only slivers of areas are available for new licensing, and that, as a result, there will be “significant technical complexity engineering a network to operate without impacting adjacent licensees.”223 The technical complexities that may result from an auction of overlay licenses are a by-product of its most important advantage, namely the protection of the rights and interests of incumbent licensees. As such, potential bidders will need to consider carefully these technical issues as they decide whether to participate in the auction. Voqal further argues that
214 NPRM, 33 FCC Rcd at 4689-90, para. 5. 215 This information is based on a review of the Universal Licensing System conducted on May 13, 2019. 216 This information is based on a review of the Universal Licensing System conducted on May 13, 2019. 217 This information is based on a review of the Universal Licensing System conducted on May 13, 2019. Sprint indicates that it has leases covering approximately 1,600 call signs in the 2.5 GHz band. Sprint Comments at 14. 218 47 CFR § 27.1214(e). 219 Sprint Comments at 14; WCAI Comments at 33. 220 AT&T Comments at 8. 221 BRS/EBS Fourth MO&O, 23 FCC Rcd at 6044, para. 137. 222 EBS Parties Reply at 3-4; NACEPF Comments at 51-52; South Florida EBS Comments at 11-12 (stating that overlay licenses would likely be purchased by the current lessees giving them an incentive to terminate leases and work toward the failure of educational services on current licenses where they would hold an exclusive right to licensing of the spectrum in the event of such failure). 223 Voqal Comments at 26.
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“allowing a new buyer to purchase this spectrum would foreclose opportunities for existing providers to cover these areas just outside the current GSAs, and that this could lead to very different levels of service in the two adjacent GSAs, which could include residents of the same county.”224 We note that overlay licensees will have an incentive to put to use licenses they acquired at auction and also will be required to provide service in order to meet their performance requirements. Proceeding to auction of the vacant and available EBS spectrum will permit market forces to determine the highest and best use of this spectrum.225 82. Incentive Auction. We find that conducting an incentive auction226 could be particularly challenging for purposes of assigning flexible use licenses for EBS white spaces because: (1) the majority of the licensed EBS spectrum is already leased, (2) incumbent EBS licensees and potential bidders have demonstrated little interest in participating in an incentive auction, and (3) many EBS licensees do not have authorization under state law to participate in any kind of auction.227 Commenters note that such “[t]wo-sided auctions are complicated, costly to the government as well as to participants, and take a long time to complete;”228 moreover, any repacking process would be disruptive for incumbent EBS licensees that wish to continue to provide educational services.229 We therefore conclude that our policy objectives are better served by assigning overlay licenses subject to auction as described above. 83. Most commenters oppose an incentive auction because the vast majority of EBS spectrum is subject to long-term leases that would preclude most EBS licensees from participating in the reverse auction.230 They note that an incentive auction would not work from a legal or practical perspective because it would require participation from both existing licensees and their lessees.231 Further, commenters note that even if the terms of leases permitted licensees to participate in an incentive auction to relinquish their spectrum usage rights, and forward auction participants bid on licenses subject to the existing leases,232 the prevalence of long-term leases could severely limit bidders’ interest in the new licenses offered. Commenters contend that the existence of the leases lessens the likelihood that entities other than the current lessee would bid,233 and that it would “badly distort a potential forward
224 Id. 225 See, e.g., Promoting Investment in the 3550-3700 MHz Band, Report and Order, 33 FCC Rcd 10598, 10652, para. 102 (2018). 226 An incentive auction is an auction in which an incumbent license holder is encouraged to “relinquish voluntarily some or all of its spectrum usage rights” to permit the assignment of new flexible use licenses and in return to receive a portion of auction proceeds from an FCC-conducted auction. 47 U.S.C. § 309(j)(8)(G). The statute requires that a portion of proceeds to be shared with the incumbent be based on the value of the relinquished spectrum rights, as determined in a reverse auction. Id. 227 HITN Comments at 2; NACEPF Comments at 49-51; Sprint Comments at 13-15; TPI Comments at 4 (“[A]rgument for a two-sided auction is stronger for something like the recent TV band auction, which involved significant repacking and band coordination issues. These issues are less important with the EBS licenses, most of which are already leased for non-educational purposes. This suggests that participation in a reverse auction might be minimal. Participation might also be complicated by the licensee-lessee relationship, which would have to be resolved before a licensee could participate”); Voqal Comments at 25-26; WCAI Comments at 32 (“an incentive auction would be wholly inappropriate in the EBS context”); EBPARC Reply at 4 (“Clearly if a license holder or licensee has constructed its own system and is using it, then they cannot expect to sell the license and keep operating. Additionally, demand from buyers for spectrum that is already leased to Sprint, or another party would also be limited, since the lease would prevent construction of another system by the buyer. Finally, the EBS licensing rules have encouraged an environment where EBS spectrum leases can occur easily, which obviates the need for an incentive auction”). 228 TPI Comments at 4 (“[S]pectrum from the recent TV band incentive auction, proposed in the 2010 National Broadband Plan, will only become available in 2020 and less than 60% of the amount targeted will actually become available”); see also NACEPF Comments at 50; Voqal Comments at 25-26 (describing that the Broadcast Incentive Auction was authorized in 2012, completed in 2018, and that it is likely that the repack will not be completed until 2025).
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Page 132 of 188 Federal Communications Commission FCC 19-62 auction.”234 84. AT&T claims that EBS licensees would be able to participate in an incentive auction, despite existing leases, because they could negotiate a price at which lessees would give up their rights.235 We expect that it likely would be difficult or impossible for many EBS licensees to pay commercial lessees to break their leases, as most EBS licensees are educational, non-profit entities. Although TechKnowledge suggests that the Commission could invalidate lease provisions that would prevent EBS licensees from participating in an incentive auction,236 unilaterally modifying contractual provisions agreed to as part of an agreement between a licensee and lessee raises serious questions of fairness and legality. Moreover, even if such lease provisions were invalidated, many EBS licensees may still be unable to participate in an incentive auction because they lack the legal authority under state law to do so.237 85. AT&T contends that the majority of entities opposing incentive auctions “have a powerful self-interest” in doing so because keeping EBS licensees confined to the secondary market prevents interested parties from knowing the value of the licenses, especially after eligibility and use restrictions are eliminated.238 While AT&T likely is correct that lessors and lessees have an interest in protecting existing leases, we find that such an interest is legitimate where they have relied on those leases to build their networks and where such leases have long been permitted under our rules. 86. While there is limited support in the record for an incentive auction as a way to “encourage incumbents to relinquish voluntarily some or all of their spectrum usage rights,”239 we conclude that we can achieve much the same result with less disruption to existing licensees and lessees through an auction of overlay licenses.240 For example, commenters allege that, if we act on our proposals to eliminate eligibility restrictions and make EBS licenses readily transferable, an incentive auction will not be necessary to promote the transition of the band to commercial use, since the use of the spectrum is not changing. 241 As WCAI notes, EBS licensees that wish to sell their licenses and have the ability to do
(Continued from previous page) 229 NACEPF Comments at 51; TPI Comments at 4. 230 Sprint Comments at 14 (an “incentive auction at 2.5 GHz is not feasible from a commercial or regulatory perspective given that most existing EBS spectrum is subject to long-term leases that would legally prohibit licensee participation in the reverse auction. Sprint in particular has long-term lease arrangements involving approximately 1600 call signs in the 2.5 GHz band, which covers over 60% of the current EBS licenses. These licensees cannot return this spectrum to the Commission without implicating Sprint’s contractual rights. Notably, EBS leases typically include provisions such as rights of first refusal on the sale of the license and the lease of the spectrum following expiration of the lease and exclusivity terms, which preclude any negotiations regarding alternative spectrum uses”); Voqal Comments at 26 (noting that “roughly 90% of all EBS licenses are leased to a commercial provider. On average, these lease agreements do not expire for approximately two decades. Were the Commission to pursue an incentive auction, very few licensees would participate because of their contracts with commercial providers”); WCAI Comments at 33 (EBS leases often contain rights of first refusal and other provisions that govern situations when an the EBS licensee wants to assign its license). 231 EBS Parties Reply at 3. 232 AT&T Reply at 8-9. 233 Voqal Comments at 26. 234 NACEPF Comments at 51; see also Sprint Reply at 10; Voqal Reply at 33; TechKnowledge March 27 Ex Parte, White Paper at 29-30 (noting that, if the Commission does not invalidate lease terms, there would be an impact on the auction process). 235 AT&T Reply at 8. 236 TechKnowledge March 27 Ex Parte, White Paper at 20-28. 237 See para. 67, supra for a discussion of Dillon’s Rule and the alleged inability of many local government entities to participate in a spectrum auction. See also University of Cincinnati Comments at 1; see also Comments of North (continued….) 31
Page 133 of 188 Federal Communications Commission FCC 19-62 so will be able to sell quickly and efficiently, and without administrative costs, via secondary markets, due to the lifting of the eligibility restrictions.242 In addition, as WCAI explains, not all EBS spectrum is fungible.243 In these circumstances, given our decision to eliminate eligibility restrictions, an auction of overlay licenses will quickly assign licenses for EBS white spaces and promote the transition of the band with little disruption to existing users of the spectrum. 87. Applicability of Part 1 Competitive Bidding Rules. Substantially consistent with the NPRM, we adopt our proposal to conduct any auction of EBS licenses in conformity with the general competitive bidding rules in part 1, Subpart Q, including any modifications that the Commission may adopt for its part 1 general competitive bidding rules in the future.244 We believe that the Commission’s general competitive bidding rules are suitable to conduct an auction of EBS licenses. The limited comment we received on these issues generally supports use of the general part 1 competitive bidding rules.245 We believe our part 1 rules will allow market forces to determine its highest and best use, and thus will enable the Commission to meet its goal of spurring more efficient and effective use of the 2.5 GHz band.246 These rules have proven successful in numerous spectrum auctions and establish an auction process that promotes “efficient and intensive use” of this spectrum and the “development and rapid deployment of new technologies, products, and services for the benefit of the public, including those residing in rural areas,” and that “recover[s] for the public . . . a portion of the value of the public spectrum resource made available for commercial use.247 88. We will adopt bidding credits for EBS, although the NPRM proposed not to apply any designated entity preferences.248 Based on our experience with the use of bidding credits in recent spectrum auctions, we now conclude that using bidding credits in competitive bidding for the 2.5 GHz band is an effective tool to achieve our statutory objective of promoting the participation of designated entities in the provision of spectrum-based service.249 In designing auction rules and procedures, the Commission takes into account both the nature of the service and the nature of the parties most likely to be interested in using the spectrum.250 Bidding credits have been successful in other auctions, including
(Continued from previous page) Carolina Association of Community College Presidents, Docket 03-66 at 2 (filed Aug. 8, 2008); Reply Comments of North Carolina Association of Community College Presidents, Docket 03-66 at 2 (filed Oct. 14, 2008). 238 AT&T Reply at 7-8. 239 Midco Comments at 17; AT&T Reply at 6-10; TechKnowledge March 27 Ex Parte, White Paper at 15-18. TechKnowledge suggests that licenses not offered in an incentive auction could remain subject to the existing educational use and eligibility restrictions as a way to encourage licensees to participate. TechKnowledge March 27 Ex Parte, White Paper at 20. Maintaining such restrictions would be inconsistent with our goal of increasing the use and flexibility of EBS licenses. 240 While Midco suggests that the Commission consider using auction proceeds to fund programs to close the homework gap, Midco Comments at 17, Voqal correctly notes that the Commission lacks the authority to disburse auction funds in this way. Voqal Comments at 20 n.55. Although we agree that closing the homework gap is a laudable goal, our current auction authority does not permit us to use auction revenues this way. See 47 U.S.C. § 309(j)(8). 241 WCAI contends that an “incentive auction is best utilized where there is a need for the Commission to organize the market and match the demand of buyers with the supply from sellers . . . In the case of EBS spectrum, the market has worked efficiently since the Commission’s 1983 decision permitting leasing . . .” WCAI Comments at 34-35. T-Mobile agrees with WCAI and suggests that an incentive auction works well when the use of spectrum is changing substantially, and that it is unlikely to be the case here-most EBS spectrum is already being used for mobile broadband. T-Mobile Reply at 3-4. According to T-Mobile, incentive auctions are “invaluable to resolve situations where secondary markets do not function well” but that the due to the amount of leasing of EBS spectrum, that is clearly not the case here. T-Mobile Reply at 2. 242 WCAI Comments at 35.
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Page 134 of 188 Federal Communications Commission FCC 19-62 prior auctions of the 2.5 GHz band.251 The removal of the eligibility restriction and educational use requirements will attract more commercial operators to the 2.5 GHz band and bidding credits should help to facilitate greater participation in any auction of EBS licenses.252 We now conclude that offering bidding credits to designated entities, along with the updates to the 2.5 GHz band that we adopt today, strike the appropriate balance and should improve the ability of small businesses to attract the capital necessary to meaningfully participate in an auction of 2.5 GHz spectrum, best satisfying our congressional objectives.253 We therefore agree with the comments we received supporting the use of bidding credits in an EBS auction.254 89. Consistent with our other recent auctions, we will adopt the high two of three thresholds in the Commission’s standardized schedule of bidding credits for auction of spectrum well suited for 5G deployment.255 Accordingly, an entity with average annual gross revenues for the preceding five years not exceeding $55 million will qualify as a “small business,” while an entity with average annual gross revenues for the preceding five years not exceeding $20 million will qualify as a “very small business.”256 In the Competitive Bidding Second Memorandum Opinion and Order, the Commission stated that it would define eligibility requirements for small businesses on a service-specific basis, taking into account the capital requirements and other characteristics of each particular service in establishing the appropriate threshold.257 While the capital requirements of the services to be deployed in these bands is not yet known, we believe that using these gross revenue thresholds will enhance the ability of small businesses to acquire and retain capital and thereby complete meaningfully at auction. We also believe that these thresholds are not overly inclusive, and prevent designated entity benefits from flowing to entities for which such credits are not necessary. We will provide qualifying “small businesses” with a bidding credit of 15% and qualifying “very small businesses” with a bidding credit of 25%, consistent with the standardized schedule in Part 1 of our rules.258 We reject the proposal for the use of three tiers of small business bidding credits because we believe that this two-tiered approach has been successful in the past,
(Continued from previous page) 243 Id. at 33-34 (depending on what licenses a commercial operator already owns and/or leases, certain EBS channel groups may be more or less valuable to them). 244 NPRM, 33 FCC Rcd at 4702, para. 49. 245 See Sprint Comments at 11; WCAI Comments at 18. 246 See e.g., Incentive Auction Report and Order, 29 FCC Rcd at 6570, para. 2. 247 47 U.S.C. §§ 309(j)(3)(A), (C), (D). 248 NPRM, 33 FCC Rcd at 4702, para. 49. 249 See e.g. Select Spectrum Comments at 4 (“the Commission should use the designated entity rules that have been successful in attracting smaller companies to bid and win in past auctions including the 700 MHz Auction and the 600 MHz Auction”). 250 See Amendment of the Commission’s Rules with Regard to Commercial Operations in the 3550-3650 MHz Band, GN Docket No. 12-354, Further Notice of Proposed Rulemaking, 29 FCC Rcd 4273, 4313, para. 131 (2014). 251 See Spectrum Frontiers R&O, 31 FCC Rcd at 8089-8100, paras. 248-250 (applying high two bidding credits to auctions of Upper Microwave Flexible Use Service licenses). See also BRS/EBS Fourth MO&O, 23 FCC Rcd at 6006-07, paras. 26-28. 252 See WCAI Comments at 16 (“Eliminating the eligibility requirements in Section 27.1201 of the Rules and permitting commercial entities to directly hold EBS licenses without the costs associated with leasing will promote intensive and efficient spectrum use by providing EBS licensees to those who ultimately place the greatest value on the spectrum.”).
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Page 135 of 188 Federal Communications Commission FCC 19-62 and will once again use it.259 We believe the use of the small business definitions and associated bidding credits set forth in the Part 1 bidding credit schedule will provide consistency and predictability for small businesses.260 90. The rural service provider bidding credit awards a 15% bidding credit to those servicing predominantly rural areas and that have fewer than 250,000 combined wireless, wireline, broadband and cable subscribers.261 We will apply the rural service provider bidding credit to auction of EBS licenses in the 2.5 GHz band. We believe that a targeted bidding credit will better enable rural service providers to compete for spectrum licenses at auction and in doing so, will increase the availability of 5G service in rural areas. The comments we received support the use of the rural service provider bidding credit.262 91. In the Competitive Bidding Update Report and Order, the Commission adopted a process for establishing a reasonable monetary limit or cap on the amount of bidding credits that an eligible small business or rural service provider may be awarded in any particular auction.263 It established the parameters to implement a bidding credit cap for future auctions on an auction-by-auction basis.264 Consistent with the Commission's longstanding approach, we will initiate a public notice process to solicit public input on certain details of auction design and the auction procedures for the auction of EBS licenses. As part of that process, we will solicit public input on the appropriate amount of the bidding credit cap and subsequently establish the cap that will apply for that auction, based on an evaluation of the expected capital requirements presented by the particular spectrum being auctioned and the inventory of licenses to be auctioned.265 92. The tribal lands bidding credit program awards a discount to a winning bidder for serving qualifying tribal land that have a wireline telephone subscription rate equal to or less than 85% of the population.266 We believe that tribal entities involved in the telecommunications industry face unique challenges in participating in spectrum auctions and that the tribal lands bidding credit will promote further deployment and use of spectrum over tribal lands.267 While we are also adopting a Tribal priority
(Continued from previous page) 253 In authorizing the Commission to use competitive bidding, the Communications Act sets forth a number of requirements that the Commission must take into account, including “that small businesses, rural telephone companies, and businesses owned by members of minority groups and women are given the opportunity to participate in the provision of spectrum-based services.” 47 U.S.C. § 309(j)(4)(D). Additionally, the Commission is required to seek to promote “efficient and intensive use” of spectrum, allow for the “development and rapid deployment of new technologies, products, and services for the benefit of the public, including those residing in rural areas,” and “recover[] for the public . . . a portion of the value of the public spectrum resource made available for commercial use. 47 U.S.C. §§ 309(j)(3)(A), (C), (D). 254 See Select Spectrum Comments at 4; EBPARC Reply at 3; Midco March 5 Ex Parte; WISPA June 28 Ex Parte. 255 See Spectrum Frontiers R&O, 31 FCC Rcd at 8089-8100, paras. 248-250; 3.5 GHz Update Order, 33 FCC Rcd at 10645-47, paras. 85-89. 256 The standardized schedule of bidding credits provided in section 1.2110(f)(2)(i) defines small businesses based on average gross revenues for the preceding three years. In December 2018, Congress revised the standard set out in the Small Business Act for categorizing a business concern as a “small business concern,” by changing the annual average gross receipts benchmark from a three-year period to a five-year period. Thus, as a general matter, a Federal agency cannot propose to categorize a business concern as a “small business concern” for Small Business Act purposes unless the size of the concern is based on its annual average gross receipts “over a period of not less than 5 years.” 15 U.S.C. § 632(a)(2)(C)(ii)(II), as amended by Small Business Runway Extension Act of 2018, Pub. L. No. 115-324 (Dec. 17, 2018). We therefore adopt the Small Business Act’s revised five-year average gross receipts benchmark for purposes of determining which entities qualify for small business bidding credits. But because the SBA has not yet revised its regulations to update the definition of “small business concern,” for purposes of compliance with the Regulatory Flexibility Act, the Commission will continue to use the SBA’s current definition of “small business,” which is based on a three-year benchmark. See infra App. B.
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Page 136 of 188 Federal Communications Commission FCC 19-62 window, we believe the priority window and bidding credit can complement each other and help facilitate service on Tribal lands. No commenters oppose the tribal land bidding credit nor suggest that the tribal lands bidding credit is unnecessary. Accordingly, a winning bidder for a market will be eligible to receive a credit for serving qualifying Tribal lands within that market, provided it complies with the applicable competitive bidding rules.268 2. Description of Licenses Being Offered 93. Geographic Area. We adopt counties as the appropriate geographic size for new licenses.269 We find that a county-based license will afford overlay licensees the flexibility to develop localized services, allow for targeted deployments based on market forces and customer demand, and facilitate access by both smaller and larger providers.270 As noted by several commenters, counties also “nest” into Basic Trading Areas (BTA)s, and thus they are congruent with the current footprint of BRS licensees, creating consistency with the existing BRS licensing framework.271 As noted by supporters, licensing by county accommodates a wide variety of business models: it enables rural providers to obtain spectrum just in the area that they intend to serve, while allowing larger providers to aggregate spectrum in multiple counties as part of a larger business plan. 94. We reject the alternative of census tracts as the geographic area licensing unit. We agree with commenters opposing the use of census tracts272 that census tracts are extremely numerous and are dynamic in size and location, which makes them difficult to manage and organize.273 These commenters contend that “the numerous boundaries make RF containment problematic, a problem that would be exacerbated by the relatively higher field strength limits involved with 2.5 GHz equipment that can operate at hundreds of watts of power.”274 Because many census tracts would be smaller than the average coverage area of a single 2.5 GHz base station, we conclude that census tracts would be unworkable. 95. We also find Sprint’s proposal to offer large-area licenses, based on either Partial Economic Areas or BTAs, inferior to basing licenses on counties.275 While Sprint notes that “BTA
(Continued from previous page) 257 Implementation of Section 309(j) of the Communications Act—Competitive Bidding, Second Memorandum Opinion and Order, PP Docket No. 93-253, 9 FCC Rcd 7245, 7269, para. 145 (1994); 47 CFR § 1.2110(c)(1). 258 47 CFR § 1.2110(f)(2)(i)(B), (C). 259 See WISPA June 28, 2019 Ex Parte at 1-2. The proposal for the use of three tiers of bidding credits lacks the necessary justification of why a third tier of bidding credits is necessary to enhance the ability of small businesses to acquire and retain the capital necessary to compete meaningfully at auction for EBS licenses. See Incentive Auction R&O, 29 FCC Rcd at 6763-64, para. 477. While the Commission previously adopted three tiers of bidding credits for auction of BRS licenses, the Commission has adopted two tiers of bidding credits in the vast majority of service rule proceedings in which it has adopted small business bidding credits. Given the smaller license size of county than the BRS BTA license, and the lack of information on how a third bidding credit is necessary, we believe the two tiers adopted are appropriate. 260 We direct the Wireless Telecommunications Bureau in conjunction with the Office of Economics and Analytics to seek further comment on the two specific small business standards we adopt today for determining an entity’s eligibility for small business bidding credits in an auction of unlicensed EBS spectrum. Specifically, we direct WTB in conjunction with OEA to seek comment on defining a “small business” as a business with average gross revenues for the preceding five years not exceeding $55 million, and a “very small business” as a business with average gross revenues for the preceding five years not exceeding $20 million. We further direct that WTB and OEA should consult with the Small Business Administration and obtain its approval of the adopted small business size standards in advance of any auction of 2.5 GHz EBS white spaces licenses. 15 U.S.C. § 632(a)(2)(C); 47 CFR § 121.903. 261 Updating Part 1 Competitive Bidding Rules, WT Docket No. 14-170, Report and Order; Order on Reconsideration of the First Report and Order, Third Order on Reconsideration of the Second Report and Order; Third Report and Order, Competitive Bidding Update Report and Order, 30 FCC Rcd 7493, 7530, para. 88 (2015) (Competitive Bidding Update Report and Order). 262 See WISPA June 28, 2019 Ex Parte at 1-2.
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Page 137 of 188 Federal Communications Commission FCC 19-62 licensing in particular has the benefit of consistency with the existing BRS licensing framework,”276 we are not persuaded that consistency with the BRS framework alone warrants adopting a larger license size for EBS spectrum. 96. Band Plan. We adopt a band plan that will include three overlay licenses: the first license will include channels A1-A-3, B1-B3, C1-C3 (49.5 megahertz); the second license will include channels D1-D3, the J channels, and channels A4-G4 (50.5 megahertz); and the third license will include channels G1-G3 and the relevant EBS K channels (16.5 megahertz of contiguous spectrum and 1 megahertz of the K channels associated with the G channel group). A group of small rural carriers supports this band plan.277 By providing applicants the flexibility to bid on three different licenses we also will provide opportunity for entities of various sizes and spectrum needs to participate in an auction. As commenters note, it is important that wide channel blocks of contiguous spectrum be available because wider blocks are necessary to provide high-speed broadband access.278 By creating two new wider channel blocks of 49.5 megahertz and 50.5 megahertz of contiguous spectrum, respectively, we have done just that. Moreover, by creating two new licenses of almost equal size while keeping channel groups together, we have made it easier for the new overlay licensees to coordinate with the incumbent EBS licensees.279 97. In the NPRM, we asked commenters to address the appropriate channel block size for future licensing and to discuss why such a channel block size would serve the public interest, and we received a variety of proposals in response.280 While some commenters argue that we should license the current middle band segment as a separate license, we conclude that such an approach would be spectrally inefficient.281 The middle band segment was originally designed for legacy video services,282 which have virtually disappeared from the band. Licensing the middle band channels separately creates discontiguity, which is ill-suited for wireless broadband use in general and Time Division Duplexing (TDD)—the predominant use of the band currently—in particular. For this reason, while we agree with WCAI and
(Continued from previous page) 263 Competitive Bidding Update Report and Order, 30 FCC Rcd at 7539-44, paras. 110-21. 264 Id. 265 Id. at 7541, para. 114. 266 47 CFR § 1.2110(f)(3). 267 See Midco Mar. 5, 2019 Ex Parte at 6 (advocating that the Commission offer robust bidding credits in an EBS auction to “encourage development in Tribal areas.”). 268 Id. 269 NTCA Comments at 6; WCAI Comments at 5; T-Mobile Reply at 7-8; TechKnowledge March 27 Ex Parte, White Paper at 30. 270 NTCA Comments at 6. 271 Id. 272 Midco finds either census tracts or counties acceptable, although it maintains that counties would be easier to administer. Midco Comments at 8-9. 273 T-Mobile Reply at 7-8. 274 Id. 275 Sprint Comments at 11. 276 Id. 277 Carolina West, et al. July 3 Ex Parte at 2. 278 Midco Comments at 17-18; Sprint Comments at 11; WCAI Comments at 19-20; WISPA Comments at 20-21.
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Sprint that having three different licenses is appropriate, we do not adopt their specific proposed band plans. WCAI suggests licenses for the lower band (A1-3, B1-3, C1-3, D1-3 and the J channels), the middle band (A-G4) and the upper band. (G1-G3 and the K channels), while Sprint proposes three licenses at (1) A1-4 and B1-4, (2) C1-4 and (3) D1-4 and G1-4.283 We also reject WISPA’s proposal, supported by US Cellular, for four channel blocks, (1) A1-3 and B1-3, (2) C1-3 and (3) D1-3, A4, B4, C,4, D4 and G4 and (4) G1-G3.284 By creating separate licenses for the lower and middle parts of the band, these proposals would not maximize the 2.5 GHz band’s potential to be used for high-speed wireless broadband services. The band plan we adopt today will also create two wide channel blocks of almost equal size. We note that WISPA would find the band plan we adopt today acceptable as an alternative,285 and we also believe the band plan we adopt today is responsive to U.S. Cellular’s argument that fixed wireless providers generally need 45 megahertz of spectrum to deploy in the 2.5 GHz band.286 98. We further find that the EBS white space discounts from the spectrum screen also should be eliminated. In the NPRM, we sought comment on whether any rule changes adopted here would warrant modification of our treatment of EBS spectrum in the spectrum screen.287 Although one commenter, opposing revision of the screen, argues that changes are unnecessary,288 several others support revising the spectrum screen.289 WCAI, for example, argues that retaining a spectrum screen discount “based on outdated educational use requirements and eligibility would not reflect the new reality that all EBS spectrum can be used for commercial purposes.”290 AT&T similarly argues that changing the EBS spectrum rules and repurposing EBS spectrum would require the Commission to revise the spectrum screen to include all EBS spectrum because the changes would make all EBS spectrum “‘used and useful’ for the provision of mobile broadband services.”291 99. Although the Commission previously excluded 16.5% of EBS spectrum from the spectrum screen to account for the fact that commercial providers did not have an opportunity to gain access to EBS white space spectrum, this discount is no longer necessary.292 Accordingly, we find that EBS white space spectrum should be considered “available,” for purposes of the spectrum screen. 100. Finally, we conclude that it is no longer necessary to exclude 5% of EBS spectrum from
279 The J channels account for an additional 4 megahertz of lower guard band EBS spectrum which will be newly added to the spectrum screen. 280 NPRM, 33 FCC Rcd at 4702, para. 50. 281 Select Spectrum Comments at 3; WCAI Comments at 18-19; WISPA Comments at 20-21. 282 BRS/EBS R&O, 19 FCC Rcd at 14184, para. 39. 283 Sprint Comments at 11. 284 WISPA Comments at 20-21; see also U.S. Cellular July 1 Ex Parte. 285 WISPA July 2 Ex Parte at 2. 286 U.S. Cellular July 2 Ex Parte at 2. 287 NPRM, 33 FCC Rcd at 4695, para. 24. 288 Select Spectrum Comments at 5. 289 WCAI Comments at 23-24; Midco Comments at 19, AT&T Comments at 8 n.16. 290 WCAI Comments at 23-24. 291 AT&T Comments at 8 n.16. 292 Nebraska notes that the spectrum screen depends on white space and how it is used. Nebraska Joint Agency Comment at 11; see also AT&T Comments at 8, n.16 (asserting that if the Commission decides to repurpose EBS spectrum, by, among other things, conducting a regular spectrum auction of unlicensed EBS spectrum, it should revise the spectrum screen).
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Page 139 of 188 Federal Communications Commission FCC 19-62 the spectrum screen in light of our decision to eliminate the educational use requirement.293 While we recognize that some existing EBS spectrum leases may include terms with educational use restrictions,294 we believe that if there are such aspects of EBS spectrum leases that warrant further consideration, our case-by-case review of secondary market transactions is the best way to assess the impact of such spectrum lease contractual provisions in particular local markets.295 3. Requirements for New 2.5 GHz Licensees 101. Performance Requirements. We adopt the performance requirements that the Commission proposed in the NPRM,296 replacing the existing substantial service regime297 with a menu of specific performance requirements for EBS licensees that depend on the specific service they are offering.298 Going forward, EBS licensees that are required to make a build-out showing under these new standards299 may fulfill their final performance requirements by showing any of the following: (1) 80% population coverage for mobile or point-to-multipoint service (50% interim); (2) 40 links per million persons (one link per 25,000) for fixed point-to-point service (20 links per million interim (one link per 50,000)); or (3) 80% population coverage for broadcast service (50% interim). No other types of showing or levels of coverage will be accepted.300 These benchmarks will apply to both licenses won at auction and licenses granted through the Tribal priority window. 102. These benchmarks are similar to those for the AWS-3 and WCS bands (which have similar propagation characteristics) but are slightly higher (an additional 5%) to account for the maturity of technologies already developed and deployed in the 2.5 GHz band.301 Specifically, while the AWS-3 and WCS performance requirements were established before there were extensive operations in those bands, there are currently extensive operations and ample equipment in the 2.5 GHz band. These increased requirements will help to address the concerns of some commenters that current licensees of this spectrum are not deploying to all communities within their license areas.302 This approach to
293 Mobile Spectrum Holdings Report and Order, 29 FCC Rcd at 6186, para. 123. 294 Several commenters note extensive leasing arrangements in the EBS band and want those leases to be preserved. HITN Comments at 4; NAUF Comments at 8; Voqal Comments at 6, 10. We agree with commenters that our actions should not harm or invalidate existing leases, and we emphasize that nothing in our actions is intended to invalidate existing lease provisions. 295 Mobile Spectrum Holdings Report and Order, 29 FCC Rcd at 6239, paras 284-85. 296 NPRM, 33 FCC Rcd at 4703-04, para. 54. 297 Currently, licensees in the 2.5 GHz band, including EBS licensees, are subject to a substantial service regime of performance requirements, which were set forth in 2006 as part of the ongoing efforts to transition the band to the new band plan established in 2004. Licensees were required to demonstrate compliance by May 1, 2011. This requirement includes specific safe harbors, including 30% population coverage for mobile or point-to-multipoint use, six permanent links per million for fixed point-to-point services, and an educational safe harbor for EBS licensees specifically, consisting of 20 hours of educational use per channel, per week. See BRS/EBS Second R&O, 21 FCC Rcd at 5719-33, paras. 276-304; see also BRS/EBS FNPRM, 19 FCC Rcd at 14282-84, paras. 321-22. 297 NPRM, 33 FCC Rcd at 4703-04, paras. 54-55. 298 Id. at 4703-04, para. 54. 299 As we discuss below, this does not include existing licensees who have already fulfilled their performance requirements under the previous standards. 300 Licensees may continue to apply for extensions and waivers, per the Commission’s usual policies on such requests. 301 See 47 CFR § 27.14(p), (s). AWS-3 and WCS licensees must provide coverage of 75% of the population in their license areas as a final buildout requirement. Id. 302 See Bad River Comments at 6; Nez Perce Tribe Comments at 7; Friday Institute Reply at 8-9.
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Page 140 of 188 Federal Communications Commission FCC 19-62 performance requirements is supported by several commenters who advocate for robust performance requirements, including the NPRM proposal specifically,303 as well as other commenters who generally support build-out requirements without providing specifics.304 103. Some commenters suggest a more relaxed approach to performance requirements, including retaining the current substantial service regime.305 Other commenters support adoption of the same performance requirements as those currently applicable to BRS licensees,306 which are similar to the current EBS substantial service standard.307 We reject retaining the existing substantial service requirement for new EBS licenses, as the existing requirements are inconsistent with the build-out requirements we have adopted for similar bands such as AWS. We agree with WISPA that those substantial service standards are too vague, particularly in the context of a band that has a developed equipment ecosystem.308 The existing substantial service requirements were adopted prior to the transition to the new band plan and at a time when there was substantial uncertainty about how the band would be used in the future. Now, the ability to use EBS for broadband is well established. Given the maturity of the ecosystem in this band, and the low thresholds and vague requirements of the previous standards, we decline to continue with the substantial service regime or to adopt any minor modification thereof.309 In other bands, the Commission has determined that a substantial service regime, which lacks firm minimum requirements, does not adequately safeguard effective use of the relevant spectrum, and we extend that conclusion to EBS.310 The increased requirements we adopt in this Report and Order will address that concern more effectively than the current requirements. 104. A few commenters suggest alternatives to the NPRM proposal beyond retention of substantial service. The Nez Perce Tribe suggests that the “coverage target” should be 100% area coverage, but that the actual benchmark should be determined by each licensee according to the specific terrain and circumstances of each license.311 Other commenters propose imposing various standards of service, such as speed or affordability, as part of the performance requirement.312 We decline to
303 EBC Comments at 4 (supporting Commission proposal if limited to commercial licenses); Friday Institute Reply at 6-9 (urging “more robust” requirements); Midco Comments at 14 (supporting Commission proposal), North Carolina Comments at 6 (suggesting 50% interim area coverage and 95% final); WISPA Comments at 22-23 (supporting Commission proposal). 304 CA K-12 HSN Comments at 20 (supporting “a good process to ensure license holders are meeting minimal use requirements”); CCA Comments at 6-7 (suggesting “reasonable” standards); SETDA Comments at 8 (urging adoption of “build-out requirements that lead to timely service delivery for marginalized students”). 305 CTN/NESBA Comments at 20 (supporting substantial service); NACEPF Comments at 49 (opposing any requirement more stringent than those in place for commercial operators in other bands, including BRS); R Street Institute Comments at 9-11 (urging use of secondary markets instead), Select Spectrum Comments at 6 (supporting substantial service); Sprint Comments at 12-13 (supporting substantial service); Utah Comments at 2-3 (supporting substantial service); WCAI Comments at 30 -31 (supporting using existing standards for BRS, which provide for 30% population coverage); EBPARC Reply at 5-6 (supporting substantial service). 306 Sprint Comments at 12; WCAI Comments at 30. 307 See 47 CFR § 27.14(o)(1), (2). 308 WISPA Reply at 22. 309 For the reasons discussed in this item, we will continue to use the old substantial service requirements for the limited purpose of applying the renewal standard to existing EBS licensees. See para. 112, infra. 310 See Use of Spectrum Bands Above 24 GHz for Mobile Radio Services, et al., Report and Order, 31 FCC Rcd 8014, 8088, para. 203 (2016). 311 Nez Perce Comments at 7. 312 Midco Comments at 14-15 (minimum speed threshold of 25 Mbps down and 3 Mbps up, no data caps); SHLB Comments at 5-7, n.11 (20% of all customers should have affordable, uncapped wireless broadband service).
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Page 141 of 188 Federal Communications Commission FCC 19-62 incorporate these concepts into the new performance requirements we adopt today. The Nez Perce Tribe’s case-by-case suggestion would result in requirements that would vary across licenses, and that, if based on a licensee’s own analysis, could not be determined prior to auction. The resulting uncertainty would be unfair to auction participants, who could not reasonably anticipate the construction obligation that would accompany their new licenses. This system also would place a significant burden on licensees to justify their particular level of construction as adequate in their circumstances, rather than giving licensees a set benchmark on which to rely. We also decline to incorporate any quality of service measure into the performance requirements. We do not include such a requirement in any other wireless service as a condition of license renewal, and the commenters suggesting it have not provided evidence that EBS as a service is uniquely situated so as to require it. 105. We decline to adopt any educational use metric for performance requirements. The potential for wireless services to support education is clear; nevertheless, this goal will be supported best by adopting stringent build-out requirements that encourage wider deployment of all broadband services, rather than by attempting to define what constitutes acceptable levels or types of educational use specifically. The few comments received on this issue illustrate the difficulty of finding a specific educational metric that encourages deployment without placing an undue regulatory burden on licensees.313 The robust mobile, fixed, and broadcast metrics we adopt in this Report and Order will promote deployment of wireless services that can be used for all purposes, including education. We recognize that incumbent licensees may have relied on the educational use standard to fulfill their performance requirements in the past. Those licensees may continue to use the substantial service standard in order to make their renewal showing, but the substantial service standard, including the educational safe harbor, will not be available to new licensees in the band. 106. The Commission also sought comment in the NPRM on the appropriate timeline for the interim benchmark, and the appropriate penalty for failure to meet a benchmark.314 In this regard, we will apply the interim benchmark after four years, and the final benchmark after eight years. The penalty for failure to meet the interim benchmark will be the acceleration of the final benchmark deadline by two years, to six years rather than eight. This timeline is slightly more aggressive than WISPA’s suggestion of a five-year interim and a ten-year final deadline,315 but the critical role of mid-band spectrum in today’s spectrum environment warrants such an approach. The existing ecosystem of equipment already available in the band, and the success of recipients of waivers and STAs with expeditious deployment, also suggest that a more compressed timeline is appropriate here.316 This timeline and the two-year acceleration penalty are also largely consistent with our rules in other bands317 and will help harmonize the regulatory regime of the 2.5 GHz band with other commercial wireless services. Apart from WISPA, no other commenters offer suggestions for the timing of benchmarks or the acceleration penalty. 107. As with other wireless services, a license will automatically terminate if the licensee fails to meet the final construction benchmark.318 We reject as unnecessary Midco’s suggestion to allow one or
313 See South Florida EBS Comments at 7 (acknowledging that the current hour-based metric is a poor fit for the broadband context but cautioning that any new metric must not overburden licensees); Friday Institute Reply at 6-7 (suggesting that the metric be based on the percentage of K-20 students served, as geographic area is insufficient to describe the educational reach of a deployment). 314 NPRM, 33 FCC Rcd at 4703-04, para. 54. 315 WISPA Comments at 22-23. 316 See para. 106 infra. 317 See 47 CFR § 27.14(q) (AWS-4, interim showing four years after initial license grant, final accelerated from seven to six years if interim not met); (s) (AWS-3, final accelerated by two years if interim not met); (t) (600 MHz, same as AWS-3). 318 See 47 CFR §§ 1.946(c), 1.955(a)(2).
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Page 142 of 188 Federal Communications Commission FCC 19-62 two 90-day cure periods in order to accommodate “difficult conditions” or “other unknown impediments.”319 We expect applicants to conduct their due diligence and plan to meet these buildout deadlines. In extraordinary circumstances, the Commission may consider waiver requests to accommodate unanticipated difficulties requiring short-term accommodations. 108. For licenses acquired via the Tribal priority window described above, we adopt a different timeline. These licenses must demonstrate compliance with interim build-out levels after two years, and final build-out levels after five years. The penalty for missing the interim deadline will be an acceleration of the final deadline by one year. This timeline will encourage deployment in underserved areas, while discouraging speculation or application mills. 320 The equipment ecosystem in this band has matured considerably since potential licensees last had a routine opportunity to apply for this spectrum, and the cost and difficulty of deployment have eased significantly.321 Recent recipients of waivers and STAs in this band have been able to deploy and begin service well within a five-year timeframe.322 This timeline is also consistent with the recommendation from MuralNet, which developed and deployed the network for the Havasupai Tribe.323 109. There are also considerations specific to the Tribal window that support this timeline for those licensees. Because Tribal applicants will be able to specify their own service area, this timeline will encourage those applicants to estimate accurately the level of deployment they will be able to achieve, rather than over-claiming and thereby precluding any other potential licensee. We therefore reject Colville’s suggestion that requirements should not be “more robust” than for other licensees, 324 and Havasupai’s suggestion that Tribes should not be subject to any build-out requirement whatsoever. 325 In addition, a five-year Tribal deployment timeline will enable an auction-based overlay licensee to reclaim unbuilt spectrum before the end of its ten-year overlay license term if a Tribe is unable to build, helping to ensure that the spectrum is put to use. 110. Renewal Standards. In 2017, the Commission adopted a unified regulatory framework for the Wireless Radio Services (WRS) that replaced the existing patchwork of service-specific rules regarding renewal, comparative renewal, continuity of service, and partitioning and disaggregation, with clear and consistent rules of the road for WRS licensees.326 We adopt the NPRM’s proposal to apply the
(Continued from previous page) 319 Midco Comments at 18. 320 See EBC Comments at 3-4 (suggesting a short initial build-out period to discourage application mills). See also CoSN, SHLB, and EBPARC July 3 Ex Parte at 3. 321 See MuralNet Comments at 2, NMU Comments at 4. 322 NMU received a waiver of the filing freeze and was granted additional, geographically-adjacent license areas in November 2015; Kings County was granted an STA for additional channel groups in May 2017; and the Havasupai were granted an STA for one channel group in February 2018. Each of these entities has since deployed across the additional spectrum it was granted (Kings County has deployed in two of three channel groups) and is currently providing service. See Kings County Comments at 2-3; NMU Comments at 4; Havasupai March 29 Ex Parte at 2. 323 See MuralNet May 24 Ex Parte at 2 (advocating for a buildout requirement for existing licenses of 60% population coverage “at broadband speeds” after three years, and 90% coverage after five years). 324 Colville Comments at 12. This suggestion is also consistent with the Nez Perce Tribe’s suggested performance requirements for all licensees. Nez Perce Comments at 7. 325 Havasupai Comments at 3. 326 See Amendment of Parts 1, 22, 24, 27, 74, 80, 90, 95, and 101 To Establish Uniform License Renewal, Discontinuance of Operation, and Geographic Partitioning and Spectrum Disaggregation Rules and Policies for Certain Wireless Radio Services, Second Report and Order and Further Notice of Proposed Rulemaking, 32 FCC Rcd 8874 (2017) (WRS Second R&O or WRS FNPRM, as appropriate). This framework did not change existing performance requirement obligations. Rather, it clarified the relationship between “performance requirements” (sometimes referred to as “construction requirements” or “buildout requirements”) and “renewal standards.” Id. at (continued….) 41
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WRS framework of renewal standards to new EBS licenses, including licenses granted via the Tribal priority window.327 With the actions we take today to make EBS more flexible and similar to other bands where the WRS rules apply, we find it is now appropriate to apply the WRS rules to EBS. This change will harmonize the regulatory regime of the 2.5 GHz band with other bands that support commercial wireless services,328 and it will give licensees more clarity on their regulatory requirements and options, including the flexibility to partition or disaggregate their licenses. The record supports applying the WRS framework to new EBS licensees.329 We believe that updating the renewal standards in this manner will encourage more rapid deployment of next generation wireless services, including 5G. 111. We also apply the WRS framework to existing EBS licensees.330 The Commission sought comment on this issue in the NPRM, and several commenters support this idea.331 Applying the renewal standard to existing licenses will ensure that the licensees who hold them will continue to provide some level of service and that the frequencies covered by those licenses do not lie fallow. Consistent with our treatment of other incumbent licenses that did not have a prior renewal standard, we will require compliance with the renewal standard for renewal applications filed after January 1, 2023.332 112. In evaluating existing licensees under these new renewal standards, however, we will apply new WRS build-out standards if the Commission promulgates them.333 Without prejudging the outcome of that open proceeding, we seek to harmonize the 2.5 GHz band with other bands that support commercial wireless services, recognizing that this Order transitions the band to more flexible use. For clarity, we emphasize that the old, substantial service build-out standard contained in section 27.14(o) of the Commission’s rules will apply to existing EBS license renewals, unless the Commission alters the WRS build-out standards upon renewal. We further clarify that, for purposes of meeting the old renewal
(Continued from previous page) 8883, paras. 20-21. Performance requirements are specified for each service or band (not in the WRS proceeding) and are one component of renewal standards. Id. at 8883, para. 21. Licenses subject to WRS must meet the renewal standards at the end of every license term, including the initial one. Id. The discussion of “performance requirements” in this and the above section refers to the performance/construction requirements themselves, not to the separate issue of renewal standards. 327 See NPRM, 33 FCC Rcd at 4705, para. 55. 328 See WISPA Comments at 22-23. 329 Midco Comments at 19; Utah Comments at 2; WCAI Comments at 32; WISPA Comments at 22; Bad River Comments at 7, n.12. 330 This includes the WRS discontinuance of service rule, Section 1.953 of the Commission’s rules. WCAI objects to applying the new WRS discontinuance of service rule to existing licensees, arguing that such a proposal was not made in the NPRM. WCAI July 2 Ex Parte at 1-2. In seeking comment on applying WRS to EBS, the Commission noted that WRS “replaced the existing patchwork of service-specific rules regarding renewal, comparative renewal, continuity of service, and partitioning and disaggregation, with clear, consistent rules of the road for WRS licensees.” NPRM, 33 FCC Rcd at 4703, para. 53. Furthermore, in its comments, “WCA agrees with Commission that it should apply the standard WRS rules for permanent discontinuance and renewal to all 2.5 GHz licensed spectrum, incumbent EBS licenses and any new EBS licenses issued pursuant to this rulemaking.” WCAI Comments at 32. As for WCAI’s alternative request that it defer applying the discontinuance of service rule until January 1, 2021, we find that our general deferral of the effective date of rules in this proceeding should be sufficient, particularly since the rule will also apply to commercial BRS spectrum in the 2.5 GHz band. 331 Midco Comments at 19; Utah Comments at 2; WCAI Comments at 32. Other commenters support the idea under certain conditions. See CTN/NESBA Comments at 20-21 (suggesting a five-year transition period); Colville Comments at 12 (supporting renewal standards if Tribes are provided “sufficient time” to construct facilities); EBS Parties Reply at 4. 332 See 47 CFR § 1.949(c). While NEBSA and CTN ask for a five-year transition period (see NEBSA/CTN Comments at 21), we find that the January 1, 2023 date will provide adequate time for current EBS licensees to prepare.
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Page 144 of 188 Federal Communications Commission FCC 19-62 standard, the educational use safe harbor contained in section 27.14(o)(2) is available only to licensees that meet the old EBS eligibility standard, since that safe harbor was based on service to accredited educational institutions. If such a licensee transfers its license to an entity that does not meet that standard, the new licensee will be required to make future showings using one of the other safe harbor provisions contained in section 27.14(o). 4. Dismissal of Pending Waiver Requests 113. Upon adoption of this Report and Order, we will dismiss, without prejudice, any pending applications for new EBS licenses.334 A freeze on the filing of new EBS applications was instituted in 2003 in conjunction with the Commission’s proposing new technical rules and band plan for the 2.5 GHz band.335 The Commission has granted some waiver requests to permit the filing of applications for new EBS licenses while the freeze remained in place.336 There are a handful of additional requests for waiver of the EBS freeze currently pending that seek new EBS licenses.337 Since this Report and Order is instituting a new process for the assignment of EBS spectrum, we see no need to grant requests for waiver of the freeze, and therefore we dismiss these pending applications without prejudice. The applicants are free to participate in the license assignment processes adopted herein through the Tribal priority window or competitive bidding, as applicable. D. Cleaning up the 2.5 GHz Rules 114. Because the transition from the interleaved channel plan under the former ITFS to the new channel plan under BRS and EBS was completed in 2011, the Commission proposed to remove those rule sections that addressed the transition. 338 In light of the fact that the transition has been completed, we find that the rules are obsolete and no longer necessary, and that elimination of the rules is therefore in the public interest. We also received no comments objecting to the removal of these rules. We therefore adopt our proposal to remove sections 27.1230 through 27.1239 of our rules.339 115. We also received no comments objecting to the Commission’s proposal to make non-
(Continued from previous page) 333 In 2017, the Commission sought comment “on whether renewal term construction obligations beyond those applicable during a licensee’s initial license term would help achieve our goal of increasing the number of Americans with access to wireless communications services.” See WRS FNPRM, 32 FCC Rcd at 8911, para. 100. The WRS FNPRM remains pending. 334 Monterey Peninsula Unified School District (File Number 0007664266) and Duckwater Shoshone Tribe (File Numbers 0007768145 and 0007768146. 335 See Amendment of Parts 1, 21, 73, 74 and 101 of the Commission’s Rules to Facilitate the Provision of Fixed and Mobile Broadband Access, Educational and Other Advanced Services in the 2150-2162 and 2500-2690 MHz Bands. Notice of Proposed Rulemaking and Memorandum Opinion and Order, WT Docket No. 03-66, 18 FCC Rcd 6722, 6813, para. 226; 6825, para. 260 (2003) (NPRM and MO&O). 336 See, e.g., Application of The Board of Trustees of Northern Michigan University For a New Educational Broadband Service Station, Memorandum Opinion and Order, 23 FCC Rcd 11832 (WTB 2008); Application of The Nisqually Indian Tribe, Memorandum Opinion and Order, 28 FCC Rcd 15569 (WTB BD 2013); The Board of Trustees of Northern Michigan University, Memorandum Opinion and Order, 28 FCC Rcd 15576 (WTB BD 2013); The Board of Trustees of Northern Michigan University, Memorandum Opinion and Order, 28 FCC Rcd 15583 (WTB BD 2013); Application of The Board of Trustees of Northern Michigan University For a New Educational Broadband Service Station, Memorandum Opinion and Order, 31 FCC Rcd 3371 (WTB BD 2016). 337 See Monterey Peninsula Unified School District, File No. 0007664266; Duckwater Shoshone Tribe, File Nos. 0007768145 and 0007768146. 338 NPRM, 33 FCC Rcd at 4704, para. 56. 339 A few Multichannel Video Programming Distributors (MVPD) have received waivers to opt out of the transition so that they can continue providing service. Should an MVPD operator decide that it wishes to discontinue video service and transition to the new band plan, it can follow the process established by the Wireless (continued….) 43
Page 145 of 188 Federal Communications Commission FCC 19-62 substantive clarifying amendments to section 27.1206 of our rules.340 In light of our decisions to adopt a Tribal priority window with GSAs based on rural Tribal lands, as well as our decision not to rationalize existing licenses, we will amend section 27.1206 to reflect the decisions we have made. We also reorganize sections 27.1207, 27.1208, and 27.1209 to place similar subjects together, reduce duplication, and incorporate the rule changes we have adopted for EBS. These changes do not result in any substantive changes for existing BRS or EBS licenses. 116. Several commenters have made proposals that are outside of the scope of the subject proceeding or that have been made moot by our changes to the EBS band, and thus, we are not addressing those proposals herein.341 E. Effective Date of Rule Changes 117. In order to provide applicants in the Tribal priority window with a stable licensing environment unaffected by changes to the band, we will defer the effective date of the rule changes we adopt in this proceeding342 (other than the rules adopting the Tribal priority window and the construction requirements rule, which will apply to the Tribal priority window) until six months from the date of Federal Register publication of this Report and Order. IV. PROCEDURAL MATTERS 118. Final Regulatory Flexibility Analysis. The Regulatory Flexibility Act (RFA)343 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.”344 Accordingly, we have prepared a Final Regulatory Flexibility Analysis (FRFA) concerning the possible impact of the rule changes contained in this Report and Order on small entities. The FRFA is set forth in Appendix B.
(Continued from previous page) Telecommunications Bureau in Antilles Wireless, LLC d/b/a USA Digital, et al., Order on Reconsideration, 25 FCC Rcd 8052, 8058, paras. 13-14 (WTB 2010). 340 NPRM, 33 FCC Rcd at 4704, para. 57. 341 For example, EIBASS and NAB request that we make clear that EBS licensees are obligated to protect BAS stations in the 2483.5-2500 MHz band. NAB Comments at 1-2; EIBASS Reply at 2. EBS spectrum starts at 2502 MHz and is not adjacent to BAS spectrum. Nothing in the NPRM proposes changes to the technical or operational rules. Thus, there is nothing in this NPRM that would impact BAS stations and what EIBASS and NAB request is outside the scope of this proceeding. In addition, some commenters request that we make changes to the E-Rate program in ways that would assist educators and students. See, e.g., Midco Comments at 13-14; SETDA Comments at 9-10; Utah Comments at 4; WCAI Comments at 18-19. Nothing in the NPRM proposed any changes to the E- Rate program. Other commenters ask that we adopt new rules-such as imposing a local presence requirement on existing EBS licensees, SETDA Comments at 7, or instituting new procedures for renewal or lease approval processes for EBS licensees. Utah Comments at 2-6. With the elimination of the eligibility and educational use requirements, we see no reason to address these requests, as they are now moot. VIYA asks that we automatically provide entities providing service via special temporary authority (STA) with full licenses based on their outlay of resources. VIYA Comments at 9-12. We note that VIYA’s subsidiary Choice Communications has filed an application for permanent authority for the frequencies in questions. See File No. 0008700428 (filed June 18, 2019). The NPRM did not propose this, and we believe this issue is better addressed in the context of Choice’s pending application. Accordingly, we will not address this issue in the rulemaking. 342 We are also deferring the modification of the spectrum screen until six months from the date of Federal Register publication. 343 See 5 U.S.C. §§ 601–612. The RFA has been amended by the Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA), Pub. L. No. 104-121, Title II, 110 Stat. 857 (1996). 344 5 U.S.C. § 605(b).
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119. Paperwork Reduction Act. This document contains new or modified collection requirements subject to the Paperwork Reduction Act of 1995 (PRA), Public Law 104-13. It will be submitted to the Office of Management and Budget (OMB) for review under section 3507(d) of the PRA. OMB, the general public, and other Federal agencies are invited to comment on the new or modified information collection requirements contained in this proceeding. In addition, we note that, pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4), we previously sought, but did not receive, specific comment on how the Commission might further reduce the information collection burden for small business concerns with fewer than 25 employees. We describe impacts that might affect small businesses, which includes more businesses with fewer than 25 employees, in the Final Regulatory Flexibility Analysis in Appendix B. 120. Congressional Review Act. The Commission will send a copy of this Report & Order to Congress and the Government Accountability Office pursuant to the Congressional Review Act. See 5 U.S.C. § 801(a)(1)(A). 121. Further Information. For further information, contact John Schauble of the Wireless Telecommunications Bureau, Broadband Division, at 202-418-0797 or [email protected]. V. ORDERING CLAUSES 122. Accordingly, IT IS ORDERED, pursuant to Sections 1, 2, 3, 4, 5, 7, 301, 302, 303, 304, 307, 309, and 310 of the Communications Act of 1934, 47 U.S.C. §§ 151, 152, 153, 154, 155, 157, 301, 302a, 303, 304, 307, 309, and 310, and Section 706 of the Telecommunications Act of 1996, as amended, 47 U.S.C. § 1302, that this Report and Order IS HEREBY ADOPTED. 123. IT IS FURTHER ORDERED that the Commission’s Consumer and Governmental Affairs Bureau, Reference Information Center, SHALL SEND a copy of this Report and Order, including the Final Regulatory Flexibility Analysis, to the Chief Counsel for Advocacy of the Small Business Administration. 124. IT IS FURTHER ORDERED that the rules and requirements adopted herein WILL BECOME EFFECTIVE six months from the date of publication in the Federal Register with the exception of Sections 27.14(u) and 27.1204 of the rules, which contain new or modified information collection requirements that require review by the OMB under the PRA and which WILL BECOME EFFECTIVE after OMB review and approval, on the date specified in a notice that the Commission will publish in the Federal Register announcing such approval and effective date. 125. IT IS FURTHER ORDERED, pursuant to Sections 4(i) and 309 of the Communications Act of 1934, 47 U.S.C. §§ 154(i), 309, and Section 1.934(d)(2) of the Commission’s Rules, 47 CFR § 1.934(d)(2), that the requests for waiver of the freeze on the filing of new EBS applications filed by Monterey Peninsula Unified School District and the Duckwater Shoshone Tribe ARE DENIED, and the applications filed by Monterey Peninsula Unified School District (File No. 0007664266) and Duckwater Shoshone Tribe (File Nos. 0007768145 and 0007768146) ARE DISMISSED WITHOUT PREJUDICE.
FEDERAL COMMUNICATIONS COMMISSION
Marlene H. Dortch Secretary
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Page 147 of 188 Federal Communications Commission FCC 19-62
APPENDIX A
Final Rules
The Federal Communications Commission amends 47 CFR parts 1 and 27 as follows:
PART 1 – PRACTICE AND PROCEDURE
1. The authority citation for part 1 is revised to read as follows:
Authority: 47 U.S.C. chs. 2, 5, 9, 13; 28 U.S.C. 2461, unless otherwise noted.
2. Amend § 1.907 by revising the definition for “Covered Geographic Licenses” to read as follows:
§ 1.907 Definitions.
* * * * *
Covered Geographic Licenses. Covered geographic licenses consist of the following services: 1.4
GHz Service (part 27, subpart I of this chapter); 1.6 GHz Service (part 27, subpart J); 24 GHz Service and
Digital Electronic Message Services (part 101, subpart G); 218-219 MHz Service (part 95, subpart F);
220-222 MHz Service, excluding public safety licenses (part 90, subpart T); 600 MHz Service (part 27, subpart N); 700 MHz Commercial Services (part 27, subparts F and H); 700 MHz Guard Band Service
(part 27, subpart G); 800 MHz Specialized Mobile Radio Service (part 90, subpart S); 900 MHz
Specialized Mobile Radio Service (part 90, subpart S); Advanced Wireless Services (part 27, subparts K and L); Air-Ground Radiotelephone Service (Commercial Aviation) (part 22, subpart G); Broadband
Personal Communications Service (part 24, subpart E); Broadband Radio Service (part 27, subpart M);
Cellular Radiotelephone Service (part 22, subpart H); Citizens Broadband Radio Service (part 96, subpart
C, of this chapter); Dedicated Short Range Communications Service, excluding public safety licenses
(part 90, subpart M); Educational Broadband Service (part 27, subpart M); H Block Service (part 27, subpart K); Local Multipoint Distribution Service (part 101, subpart L); Multichannel Video Distribution and Data Service (part 101, subpart P); Multilateration Location and Monitoring Service (part 90, subpart
M); Multiple Address Systems (EAs) (part 101, subpart O); Narrowband Personal Communications
Service (part 24, subpart D); Paging and Radiotelephone Service (part 22, subpart E; part 90, subpart P);
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VHF Public Coast Stations, including Automated Maritime Telecommunications Systems (part 80, subpart J); Upper Microwave Flexible Use Service (part 30); and Wireless Communications Service (part
27, subpart D).
* * * * *
3. Amend § 1.9020 by revising paragraph (d)(2)(i) to read as follows:
§ 1.9020 Spectrum Manager Leasing Arrangements.
* * * * *
(d) * * *
(2) * * *
(i) The spectrum lessee must meet the same eligibility and qualification requirements that are applicable to the licensee under its license authorization, with the following exceptions. A spectrum lessee entering into a spectrum leasing arrangement involving a licensee in the
Public Safety Radio Services (see part 90, subpart B and §90.311(a)(1)(i) of this chapter) is not required to comply with the eligibility requirements pertaining to such a licensee so long as the spectrum lessee is an entity providing communications in support of public safety operations (see §90.523(b) of this chapter). A spectrum lessee entering into a spectrum leasing arrangement involving a licensee in the
Mobile Satellite Service with ATC authority (see part 25) is not required to comply with the eligibility requirements pertaining to such a licensee so long as the spectrum lessee meets the other eligibility and qualification requirements of paragraphs (d)(2)(ii) and (d)(2)(iv) of this section.
* * * * *
4. Amend § 1.9030 by revising paragraph (d)(2)(i) to read as follows:
§ 1.9030 Long-term de facto transfer leasing arrangements.
* * * * *
(d) * * *
(2) * * *
(i) The spectrum lessee must meet the same eligibility and qualification
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Page 149 of 188 Federal Communications Commission FCC 19-62 requirements that are applicable to the licensee under its license authorization. A spectrum lessee entering into a spectrum leasing arrangement involving a licensee in the Public Safety Radio Services (see part 90, subpart B and §90.311(a)(1)(i) of this chapter) is not required to comply with the eligibility requirements pertaining to such a licensee so long as the spectrum lessee is an entity providing communications in support of public safety operations (see §90.523(b) of this chapter).
* * * * *
§ 1.9047 [Removed and Reserved]
5. Remove and reserve § 1.9047.
PART 27 – MISCELLANEOUS WIRELESS COMMUNICATIONS SERVICES
6. The authority citation for part 27 continues to read as follows:
Authority: 47 U.S.C. 154, 301, 302a, 303, 307, 309, 332, 336, 337, 1403, 1404, 1451, and 1452, unless otherwise noted.
7. Amend § 27.4 by removing the definition for “Commercial EBS licensee” and revising the definition of “Educational Broadband Service” to read as follows:
§ 27.4 Definitions.
* * * * *
Educational Broadband Service (EBS). A radiocommunication service licensed under this part for the frequency bands specified in Sec. 27.5(i).
* * * * *
8. Amend § 27.5 by removing and reserving paragraph (i)(3).
9. Amend § 27.14 by revising paragraphs (o) introductory language, (o)(2) introductory language, (o)(2)(iii) and (o)(3) adding paragraphs (u) and (v) to read as follows:
§ 27.14 Construction Requirements.
* * * * *
(o) With respect to initial BRS licenses issued on or after November 6, 2009, the licensee must make a showing of substantial service within four years from the date of issue of the license. With respect
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Page 150 of 188 Federal Communications Commission FCC 19-62 to EBS licenses issued after [insert date of publication in the Federal Register], the licensee must comply with paragraph (u) of this section. “Substantial service” is defined as service which is sound, favorable, and substantially above a level of mediocre service which just might minimally warrant renewal. Substantial service for BRS and EBS licensees is satisfied if a licensee meets the requirements of paragraph (o)(1), (o)(2), or (o)(3) of this section. If a licensee has not met the requirements of paragraph
(o)(1), (o)(2), or (o)(3) of this section, then demonstration of substantial service shall proceed on a case- by-case basis. Except as provided in paragraphs (o)(4) and (o)(5) of this section, all substantial service determinations will be made on a license-by-license basis. Failure by any licensee to demonstrate substantial service will result in forfeiture of the license and the licensee will be ineligible to regain it.
(1) * * *
(2) An EBS license initially issued prior to [insert date of publication in the Federal
Register] has provided “substantial service” when:
* * * * *
(iii) the level of service provided by the EBS licensee meets or exceeds the minimum usage requirements specified in § 27.1214 contained in the edition of 47 CFR parts 20 through
39, revised as of October 1, 2017.
(3) An EBS or BRS licensee may be deemed to provide substantial service through a leasing arrangement if the lessee is providing substantial service under paragraph (o)(1) of this section.
(u) This section enumerates performance requirements for EBS licenses initially issued after
[insert date of publication in the Federal Register]. Licensees shall demonstrate compliance with performance requirements by filing a construction notification with the Commission, within 15 days of the expiration of the applicable benchmark, in accordance with the provisions set forth in § 1.946(d) of this chapter.
(1) All EBS licenses initially issued after [insert date of publication in the Federal
Register], must demonstrate compliance with the performance requirements described in this paragraph.
All equipment used to demonstrate compliance must be in use and actually providing service, either for
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Page 151 of 188 Federal Communications Commission FCC 19-62 internal use or to unaffiliated customers, as of the interim deadline or final deadline, whichever is applicable.
(2) Except for licensees with licenses applied for in the Tribal Priority Window, licensees providing mobile or point-to-multipoint service must demonstrate reliable signal coverage of 50% of the population of the geographic service area within four years of initial license grant, and 80% of the population of the geographic service area within eight years of initial license grant.
(3) Except for licensees with licenses applied for in the Tribal Priority Window, licensees providing fixed point-to-point service must demonstrate operation of one link for each 50,000 persons in the geographic service area within four years of initial license grant, and one link for each 25,000 persons in the geographic service area within eight years of initial license grant.
(4) Licensees with licenses applied for in the Tribal Priority Window must make an interim showing under paragraphs (o)(2) or (o)(3) of this section within two years of initial license grant.
Licensees with licenses applied for in the Tribal Priority Window must make a final showing under paragraphs (o)(2) or (o)(3) of this section within five years of initial license grant.
(5) If an EBS licensee (other than the licensee of a license issued pursuant to the Tribal
Priority Window) fails to meet interim performance requirements described in paragraphs (o)(2) or (o)(3) of this section, the deadline for that authorization to meet its final performance requirement will be advanced by two years. If an EBS licensee of a license issued pursuant to the Tribal Priority Window fails to meet interim performance requirements described in paragraphs (o)(2) or (o)(3) of this section, the deadline for that authorization to meet its final performance requirement will be advanced by one year. If an EBS licensee fails to meet its final performance requirement, its license shall automatically terminate without specific
Commission action.
(v) Paragraph (u) of this section contains new or modified information-collection and recordkeeping requirements. Compliance with these information-collection and recordkeeping requirements will not be required until after approval by the Office of Management and Budget. The
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Commission will publish a document in the Federal Register announcing that compliance date and revising this paragraph accordingly.
§ 27.1201 [Removed and Reserved]
10. Remove and reserve § 27.1203.
§ 27.1203 [Removed and Reserved]
11. Remove and reserve § 27.1203.
12. Add § 27.1204 to read as follows:
§ 27.1204 EBS Tribal Priority Filing Window
(a) The Commission will specify by Public Notice a window filing period for applications for new EBS stations on rural Tribal Lands. EBS applications for new facilities will be accepted only during this window. Applications submitted prior to the window opening date identified in the Public Notice will be returned as premature. Applications submitted after the deadline will be dismissed with prejudice as untimely.
(b) Applicants in the Tribal Priority Filing Window must demonstrate that they are eligible to file in that window. To be considered eligible for the Tribal Priority Window, an applicant must be:
(1) a federally recognized American Indian tribe or Alaska Native Village; or an entity that is owned and controlled by a federally-recognized Tribe or a consortium of federally-recognized
Tribes;
(2) requesting a license on Tribal land, which is defined to be any federally recognized
Indian tribe's reservation, pueblo or colony, including former reservations in Oklahoma, Alaska Native regions established pursuant to the Alaska Native Claims Settlement Act (85 Stat. 688) and Indian
Allotments, see §54.400(e), as well as Hawaiian Home Lands—areas held in trust for native Hawaiians by the state of Hawaii, pursuant to the Hawaiian Homes Commission Act, 1920, July 9, 1921, 42 Stat
108, et seq., as amended; and any lands designated as Tribal lands pursuant to the designation process contained in Section 54.412 of our rules prior to July 10, 2019;
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(3) requesting a GSA in a rural area, which is defined to be lands that are not part of an urbanized area or urban cluster area with a population equal to or greater than 50,000; and
(4) have a local presence on the Tribal land for which they are applying.
(c) Following the close of the Tribal Priority window, the Commission will issue a Public Notice of acceptance for filing of applications submitted pursuant to paragraph (b) of this section that meet technical and legal requirements and that are not in conflict with any other application filed during the window. Petitions to deny such applications may be filed within 30 days of such public notice. A copy of any petition to deny must be served on the applicant.
(d) If applications are filed in the Tribal Priority window that are mutually exclusive, the
Commission will use competitive bidding to resolve the mutual exclusivity. Two or more pending applications are mutually exclusive if the grant of one application would effectively preclude the grant of one or more of the others under Commission rules.
(e) For non-mutually exclusive applications, the applications will be processed in accordance with procedures to be specified by the Wireless Telecommunications Bureau.
(f) This section contains new or modified information-collection and recordkeeping requirements.
Compliance with these information-collection and recordkeeping requirements will not be required until after approval by the Office of Management and Budget. The Commission will publish a document in the
Federal Register announcing that compliance date and revising this paragraph accordingly.
13. Add § 27.1205 to read as follows:
§ 27.1205 EBS Renewal Standard.
In applying the renewal standard contained in § 1.949 of this chapter to EBS, for licenses initially issued after [insert date of publication in the Federal Register], the applicable safe harbors are the buildout standards contained in § 27.14(u) of this part. For licenses initially issued before [insert date of publication in the Federal Register], the applicable safe harbors are the buildout standards contained in
§ 27.14(o) of this part; provided, however, that the educational use safe harbor contained in § 27.14(o)(2)
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Page 154 of 188 Federal Communications Commission FCC 19-62 may only be used by a licensee that meets the eligibility requirements to hold an EBS license pursuant to the provisions of § 27.1201(a) contained in the edition of 47 CFR parts 20 through 39, revised as of
October 1, 2017.
14. Revise § 27.1206 to read as follows:
§ 27.1206 Geographic Service Area.
(a) BRS:
(1) For BRS incumbent licenses granted before September 15, 1995, the geographic service area
(GSA) is the area that is bounded by a circle having a 35 mile radius and centered at the station's reference coordinates, which was the previous PSA entitled to incumbent licensees prior to January 10, 2005, and is bounded by the chord(s) drawn between intersection points of the licensee's previous 35 mile PSA and those of respective adjacent market, co-channel licensees;
(2) For BRS BTA authorization holders, the GSA for a channel is the BTA, subject to the exclusion of overlapping, co-channel incumbent GSAs created on January 10, 2005.
(3) If an incumbent BRS license is cancelled or is forfeited, the GSA area of the incumbent station shall dissolve and the right to operate in that area automatically reverts to the GSA licensee that held the corresponding BTA.
(b) EBS:
(1) Existing EBS licensees.
(i) The GSA of EBS licenses on the E and F channel groups is defined in § 27.1216 of this part.
EBS licensees on the E and F channel groups are prohibited from expanding their GSAs.
(ii) For incumbent EBS licenses not in the E and F channel groups in effect as of [insert date of publication in the Federal Register], the geographic service area (GSA) is the area that is bounded by a circle having a 35 mile radius and centered at the station's reference coordinates, which was the previous PSA entitled to incumbent licensees prior to January 10, 2005, and is bounded by the chord(s) drawn between intersection points of the licensee's previous 35 mile PSA and those of respective adjacent market, co-channel licensees.
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(2) New initial EBS licenses.
(i) For EBS licenses issued in the Tribal Priority Window, the GSA consists of the rural Tribal land (as defined in § 27.1201(b)(2)) specified in the application.
(ii) For all other new initial licenses issued after [insert date six months after publication in the
Federal Register], the GSA is the county for which the license is issued, subject to the exclusion of overlapping, co-channel incumbent GSAs.
15. Revise § 27.1207 to read as follows:
§ 27.1207 Service Areas and Authorizations.
(a) Initial authorizations for BRS granted after January 1, 2008, shall be blanket licenses for all BRS frequencies identified in § 27.5(i)(2). Except for incumbent BRS licenses, BRS service areas are Basic
Trading Areas (BTAs) or additional service areas similar to BTAs adopted by the Commission. BTAs are based on the Rand McNally 1992 Commercial Atlas & Marketing Guide, 123rd Edition, at pages 38-39. The following are additional BRS service areas in places where Rand McNally has not defined BTAs: American
Samoa; Guam; Gulf of Mexico Zone A; Gulf of Mexico Zone B; Gulf of Mexico Zone C; Northern Mariana
Islands; Mayaguez/Aguadilla-Ponce, Puerto Rico; San Juan, Puerto Rico; and the United States Virgin Islands.
The boundaries of Gulf of Mexico Zone A are from an area twelve nautical miles from the shoreline at mean high tide on the north and east, to the limit of the Outer Continental Shelf to the south, and to longitude 91°00′ to the west. The boundaries of Gulf of Mexico Zone B are from an area twelve nautical miles from the shoreline at mean high tide on the north, to the limit of the Outer Continental Shelf to the south, to longitude
91°00′ to the east, and to longitude 94°00′ to the west. The boundaries of Gulf of Mexico Zone C are from an area twelve nautical miles from the shoreline at mean high tide on the north and west, to longitude 94°00′ to the east, and to a line 281 kilometers from the reference point at Linares, N.L., Mexico on the southwest. The
Mayaguez/Aguadilla-Ponce, PR, service area consists of the following municipios: Adjuntas, Aguada,
Aguadilla, Anasco, Arroyo, Cabo Rojo, Coamo, Guanica, Guayama, Guayanilla, Hormigueros, Isabela,
Jayuya, Juana Diaz, Lajas, Las Marias, Maricao, Maunabo, Mayaguez, Moca, Patillas, Penuelas, Ponce,
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Quebradillas, Rincón, Sabana Grande, Salinas, San German, Santa Isabel, Villalba and Yauco. The San Juan service area consists of all other municipios in Puerto Rico.
(b) For EBS initial licenses issued after [insert date of publication in the Federal Register], except for licenses issued in the Tribal Priority Window, the GSA is the county for which the license is issued, subject to the exclusion of overlapping, co-channel incumbent GSAs. For purposes of this subpart, counties are defined using the United States Census Bureau's data reflecting county legal boundaries and names valid through January 1, 2017. Except for licenses issued in the Tribal Priority Window, there shall be three initial authorizations issued in each county: one authorization for channels A1, A2, A3, B1, B2, B3,
C1, C2, and C3; the second authorization for channels D1, D2, D3, JA1, JA2, JA3, JB1, JB2, JB3, JC1,
JC2, JC3, JD1, JD2, JD3, A4, B4, C4, D4, and G4; the third authorization for channels G1, G2, G3, KG1,
KG2, and KG3.
16. Revise § 27.1208 to read as follows:
§ 27.1208 Geographic Area Licensing.
(a) All BRS and EBS licenses are geographic area licenses. Blanket licenses cover all mobile and response stations. Pursuant to that geographic area license, incumbent licensees may modify their systems provided the modified system complies with the applicable rules. The blanket license covers all fixed stations anywhere within the authorized service area, except a station must be individually licensed if:
(1) International agreements require coordination;
(2) Submission of an Environmental Assessment is required under § 1.1307 of this chapter;
(3) The station would affect the radio quiet zones under § 1.924 of this chapter.
(b) Any antenna structure that requires notification to the Federal Aviation Administration (FAA) must be registered with the Commission prior to construction under § 17.4 of this chapter.
17. Revise § 27.1209 to read as follows:
§ 27.1209 Reversion and Overlay Rights.
(a) The frequencies associated with BRS incumbent authorizations that have cancelled automatically or otherwise recovered by the Commission automatically revert to the applicable BRS BTA licensee.
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(b) The frequencies associated with EBS incumbent authorizations with a geographic service area that have cancelled automatically or otherwise recovered by the Commission automatically revert to a co- channel EBS county-based licensee, except that if the area in question is Tribal Land as defined in
§ 27.1201(b)(2) and is contiguous to the GSA of a co-channel authorization issued in the Tribal Priority
Window, the area consisting of Tribal Land reverts to the co-channel license issued in the Tribal Priority
Window.
(c) The frequencies associated with EBS authorizations issued in the Tribal Priority Window with a geographic service area that have cancelled automatically or otherwise recovered by the Commission automatically revert to a co-channel EBS county-based authorization.
18. Revise § 27.1214 to read as follows:
§ 27.1214 EBS grandfathered leases.
All leases of current EBS spectrum entered into prior to January 10, 2005 and in compliance with leasing rules formerly contained in part 74 of this chapter may continue in force and effect, notwithstanding any inconsistency between such leases and the rules applicable to spectrum leasing arrangements set forth in this chapter. Such leases entered into pursuant to the former part 74 rules of this chapter may be renewed and assigned in accordance with the terms of such lease. All spectrum leasing arrangements leases entered into after January 10, 2005, under the rules set forth in part 1 and part 27 of this chapter, must comply with the rules in those parts.
19. Revise § 27.1217 to read as follows:
§ 27.1217 Competitive bidding procedures for the Broadband Radio Service and the Educational
Broadband Service.
(a) Mutually exclusive initial applications for BRS and EBS licenses are subject to competitive bidding. For BRS auctions, the designated entity provisions of § 27.1218 of this part apply. For EBS auctions, the designated entity provisions of § 27.1219 of this part apply. The general competitive bidding procedures set forth in part 1, subpart Q of this chapter apply unless otherwise provided in this subpart.
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20. Amend § 27.1218 by revising the section heading to read as follows:
§ 27.1218 Broadband Radio Service Designated Entity Provisions.
* * * * *
21. Add § 27.129 to Read as follows:
§ 27.1219 Educational Broadband Service Designated Entity Provisions.
(a) Eligibility for small business provisions.
(1) A small business is an entity that, together with its affiliates, its controlling interests and the affiliates of its controlling interests, have average gross revenues that are not more than $55 million for the preceding five (5) years.
(2) A very small business is an entity that, together with its affiliates, its controlling interests and the affiliates of its controlling interests, has average gross revenues that are not more than
$20 million for the preceding five (5) years.
(b) Bidding credits. A winning bidder that qualifies as a small business, as defined in this section, or a consortium of small businesses may use a bidding credit of 15 percent, as specified in §
1.2110(f)(2)(i)(C) of this chapter. A winning bidder that qualifies as a very small business, as defined in this section, or a consortium of very small businesses may use a bidding credit of 25 percent, as specified in § 1.2110(f)(2)(i)(B) of this chapter.
(c) A rural service provider, as defined in § 1.2110(f)(4) of this chapter, who has not claimed a small business bidding credit may use a bidding credit of 15 percent bidding credit, as specified in §
1.2110(f)(4)(i) of this chapter
22. Remove §§ 27.1230 through 27.1239.
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APPENDIX B
Final Regulatory Flexibility Analysis
1. As required by the Regulatory Flexibility Act of 1980, as amended (RFA),1 an Initial Regulatory Flexibility Analysis (IRFA) was incorporated in the Notice of Proposed Rulemaking (NPRM) released in May 2018 in this proceeding.2 The Commission sought written public comment on the proposals in the NPRM, including comments on the IRFA. No comments were filed addressing the IRFA. This present Final Regulatory Flexibility Analysis (FRFA) conforms to the RFA.3 A. Need for, and Objectives of, the Report and Order 2. In the Report and Order, the Commission takes steps to permit more flexible use of the 2496-2690 MHz (2.5 GHz) band by current Educational Broadband Service (EBS) licensees and to provide new opportunities for EBS eligible entities, Tribal Nations, and commercial entities to obtain unused 2.5 GHz spectrum to facilitate improved access to next generation wireless broadband, including 5G, for both educational and commercial uses. EBS spectrum currently is assigned in geographic areas of various sizes and shapes and is subject to unique use and transfer restrictions. Consistent with the Commission’s goal of making additional spectrum available for flexible use, and to promote use of EBS frequencies that have been unassigned for far too long, we take steps to encourage and facilitate more efficient use of the 2.5 GHz band. These steps are not intended to curtail the spectrum usage rights of existing EBS licensees, nor to annul or disturb existing agreements between such licensees and commercial operators. Additionally, since the process for transitioning Broadband Radio Service (BRS) and EBS licensees to the new band plan was completed in 2011, we eliminate the BRS/EBS transition rules. We believe it is in the public interest to eliminate these regulations that are out of date and no longer necessary. B. Summary of Significant Issues Raised by Public Comments in Response to the IRFA 3. There were no comments filed that specifically addressed the proposed rules and policies presented in the IRFA. C. Response to Comments by the Chief Counsel for Advocacy of the Small Business Administration 4. Pursuant to the Small Business Jobs Act of 2010, which amended the RFA, the Commission is required to respond to any comments filed by the Chief Counsel for Advocacy of the Small Business Administration (SBA), and to provide a detailed statement of any change made to the proposed rules as a result of those comments.4 5. The Chief Counsel did not file comments in response to the proposed rules in this proceeding.
1 See 5 U.S.C. § 603. The RFA, see 5 U.S.C. § 601-612, has been amended by the Small Business Regulatory Enforcement Fairness Act of 1996, (SBREFA) Pub. L. No. 104-121, Title II, 110 Stat. 857 (1996). 2 See Amendment of Parts 1, 21, 73, 74 and 101 of the Commission’s Rules to Facilitate the Provision of Fixed and Mobile Broadband Access, Educational and Other Advanced Services in the 2150-2162 and 2500-2690 MHz Bands; Transforming the 2.5 GHz Band, Notice of Proposed Rulemaking, 33 FCC Rcd 4687 (2018) (NPRM). 3 See 5 U.S.C. § 604. 4 5 U.S.C. § 604(a)(3).
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D. Description and Estimate of the Number of Small Entities To Which the Proposed Rules Will Apply 6. 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 rules adopted herein.5 The RFA generally defines the term “small entity” as having the same meaning as the terms “small business,” “small organization,” and “small governmental jurisdiction.”6 In addition, the term “small business” has the same meaning as the term “small business concern” under the Small Business Act.”7 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.8 7. Small Businesses, Small Organizations, Small Governmental Jurisdictions. Our actions, over time, may affect small entities that are not easily categorized at present. We therefore describe here, at the outset, three broad groups of small entities that could be directly affected herein.9 First, while there are industry specific size standards for small businesses that are used in the regulatory flexibility analysis, according to data from the SBA’s Office of Advocacy, in general a small business is an independent business having fewer than 500 employees.10 These types of small businesses represent 99.9% of all businesses in the United States which translates to 28.8 million businesses.11 8. Next, the type of small entity described as a “small organization” is generally “any not- for-profit enterprise which is independently owned and operated and is not dominant in its field.”12 Nationwide, as of August 2016, there were approximately 356,494 small organizations based on registration and tax data filed by nonprofits with the Internal Revenue Service (IRS).13 9. Finally, the small entity described as a “small governmental jurisdiction” is defined generally as “governments of cities, counties, towns, townships, villages, school districts, or special districts, with a population of less than fifty thousand.”14 U.S. Census Bureau data from the 2012 Census of Governments15 indicate that there were 90,056 local governmental jurisdictions consisting of general
5 Id. 6 5 U.S.C. § 601(6). 7 5 U.S.C. § 601(3) (incorporating by reference the definition of “small-business concern” in the Small Business Act, 15 U.S.C. § 632). Pursuant to 5 U.S.C. § 601(3), the statutory definition of a small business applies “unless an agency, after consultation with the Office of Advocacy of the Small Business Administration and after opportunity for public comment, establishes one or more definitions of such term which are appropriate to the activities of the agency and publishes such definition(s) in the Federal Register.” Although the Small Business Runway Extension Act of 2018, Pub. L. No. 115-324 (Dec. 17, 2018), revised the standard set out in the Small Business Act for categorizing a “small business concern” to be based on annual average gross receipts of the previous five (rather than previous three) years, the SBA has not yet revised the definition of “small business concern” in its regulations to reflect this change. Thus, for purposes of compliance with the Regulatory Flexibility Act the Commission will continue to use the definitions provided by the SBA to determine which entities qualify as a “small business,” even though we adopt a five year average gross revenue standard for purposes of qualifying for small business bidding credits. 8 15 U.S.C. § 632. 9 See 5 U.S.C. § 601(3)-(6). 10 See SBA, Office of Advocacy, “Frequently Asked Questions, Question 1 – What is a small business?” https://www.sba.gov/sites/default/files/advocacy/SB-FAQ-2016_WEB.pdf (June 2016) 11 See SBA, Office of Advocacy, “Frequently Asked Questions, Question 2- How many small businesses are there in the U.S.?” https://www.sba.gov/sites/default/files/advocacy/SB-FAQ-2016_WEB.pdf (June 2016). 12 5 U.S.C. § 601(4). 13 Data from the Urban Institute, National Center for Charitable Statistics (NCCS) reporting on nonprofit organizations registered with the IRS was used to estimate the number of small organizations. Reports generated (continued….) 59
Page 161 of 188 Federal Communications Commission FCC 19-62 purpose governments and special purpose governments in the United States.16 Of this number there were 37, 132 General purpose governments (county17, municipal and town or township18) with populations of less than 50,000 and 12,184 Special purpose governments (independent school districts19 and special districts20) with populations of less than 50,000. The 2012 U.S. Census Bureau data for most types of governments in the local government category show that the majority of these governments have populations of less than 50,000.21 Based on this data we estimate that at least 49,316 local government jurisdictions fall in the category of “small governmental jurisdictions.”22 10. Wireless Telecommunications Carriers (except Satellite). This industry comprises establishments engaged in operating and maintaining switching and transmission facilities to provide communications via the airwaves. Establishments in this industry have spectrum licenses and provide services using that spectrum, such as cellular services, paging services, wireless internet access, and wireless video services.23 The appropriate size standard under SBA rules is that such a business is small if it has 1,500 or fewer employees.24 For this industry, U.S. Census Bureau data for 2012 show that there were 967 firms that operated for the entire year.25 Of this total, 955 firms had employment of 999 or fewer employees and 12 had employment of 1,000 employees or more.26 Thus, under this category and the associated size standard, the Commission estimates that the majority of wireless telecommunications carriers (except satellite) are small entities. 11. Broadband Radio Service and Educational Broadband Service. Broadband Radio Service (BRS) systems, previously referred to as Multipoint Distribution Service (MDS) and Multichannel Multipoint Distribution Service (MMDS) systems, and “wireless cable,” transmit video programming to subscribers and provide two-way high-speed data operations using the microwave frequencies of the BRS and Educational Broadband Service (EBS) (previously referred to as the Instructional Television Fixed Service (ITFS)).27 12. BRS. In connection with the 1996 BRS auction, the Commission established a small
(Continued from previous page) using the NCCS online database indicated that as of August 2016 there were 356,494 registered nonprofits with total revenues of less than $100,000. Of this number, 326,897 entities filed tax returns with 65,113 registered nonprofits reporting total revenues of $50,000 or less on the IRS Form 990-N for Small Exempt Organizations and 261,784 nonprofits reporting total revenues of $100,000 or less on some other version of the IRS Form 990 within 24 months of the August 2016 data release date. See http://nccs.urban.org/sites/all/nccs-archive/html//tablewiz/tw.php where the report showing this data can be generated by selecting the following data fields: Report: “The Number and Finances of All Registered 501(c) Nonprofits”; Show: “Registered Nonprofits”; By: “Total Revenue Level (years 1995, Aug to 2016, Aug)”; and For: “2016, Aug” then selecting “Show Results”. 14 5 U.S.C. § 601(5). 15 See 13 U.S.C. § 161. The Census of Government is conducted every five (5) years compiling data for years ending with “2” and “7”. See also Program Description Census of Government https://factfinder.census.gov/faces/affhelp/jsf/pages/metadata.xhtml?lang=en&type=program&id=program.en.COG# . 16 See U.S. Census Bureau, 2012 Census of Governments, Local Governments by Type and State: 2012 - United States-States. https://factfinder.census.gov/bkmk/table/1.0/en/COG/2012/ORG02.US01. Local governmental jurisdictions are classified in two categories - General purpose governments (county, municipal and town or township) and Special purpose governments (special districts and independent school districts). 17 See U.S. Census Bureau, 2012 Census of Governments, County Governments by Population-Size Group and State: 2012 - United States-States. https://factfinder.census.gov/bkmk/table/1.0/en/COG/2012/ORG06.US01. There were 2,114 county governments with populations less than 50,000. 18 See U.S. Census Bureau, 2012 Census of Governments, Subcounty General-Purpose Governments by Population- Size Group and State: 2012 - United States – States. https://factfinder.census.gov/bkmk/table/1.0/en/COG/2012/ORG07.US01. There were 18,811 municipal and 16,207 town and township governments with populations less than 50,000.
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Page 162 of 188 Federal Communications Commission FCC 19-62 business size standard as an entity that had annual average gross revenues of no more than $40 million in the previous three calendar years.28 The BRS auctions resulted in 67 successful bidders obtaining licensing opportunities for 493 Basic Trading Areas (BTAs). Of the 67 auction winners, 61 met the definition of a small business. BRS also includes licensees of stations authorized prior to the auction. At this time, we estimate that of the 61 small business BRS auction winners, 48 remain small business licensees. In addition to the 48 small businesses that hold BTA authorizations, there are approximately 86 incumbent BRS licensees that are considered small entities (18 incumbent BRS licensees do not meet the small business size standard).29 After adding the number of small business auction licensees to the number of incumbent licensees not already counted, there are currently approximately 133 BRS licensees that are defined as small businesses under either the SBA or the Commission’s rules. 13. In 2009, the Commission conducted Auction 86, the sale of 78 licenses in the BRS areas.30 The Commission offered three levels of bidding credits: (i) a bidder with attributed average annual gross revenues that exceed $15 million and do not exceed $40 million for the preceding three years (small business) received a 15% discount on its winning bid; (ii) a bidder with attributed average annual gross revenues that exceed $3 million and do not exceed $15 million for the preceding three years (very small business) received a 25% discount on its winning bid; and (iii) a bidder with attributed average annual gross revenues that do not exceed $3 million for the preceding three years (entrepreneur) received a 35% discount on its winning bid.31 Auction 86 concluded in 2009 with the sale of 61 licenses.32 Of the ten winning bidders, two bidders that claimed small business status won 4 licenses; one bidder that claimed very small business status won three licenses; and two bidders that claimed entrepreneur status won six licenses. 14. EBS. Educational Broadband Service has been included within the broad economic census category and SBA size standard for Wired Telecommunications Carriers since 2007. Wired Telecommunications Carriers are comprised of establishments primarily engaged in operating and/or
(Continued from previous page) 19 See U.S. Census Bureau, 2012 Census of Governments, Elementary and Secondary School Systems by Enrollment-Size Group and State: 2012 - United States-States. https://factfinder.census.gov/bkmk/table/1.0/en/COG/2012/ORG11.US01. There were 12,184 independent school districts with enrollment populations less than 50,000. 20 See U.S. Census Bureau, 2012 Census of Governments, Special District Governments by Function and State: 2012 - United States-States. https://factfinder.census.gov/bkmk/table/1.0/en/COG/2012/ORG09.US01. The U.S. Census Bureau data did not provide a population breakout for special district governments. 21 See U.S. Census Bureau, 2012 Census of Governments, County Governments by Population-Size Group and State: 2012 - United States-States - https://factfinder.census.gov/bkmk/table/1.0/en/COG/2012/ORG06.US01; Subcounty General-Purpose Governments by Population-Size Group and State: 2012 - United States–States - https://factfinder.census.gov/bkmk/table/1.0/en/COG/2012/ORG07.US01; and Elementary and Secondary School Systems by Enrollment-Size Group and State: 2012 - United States-States. https://factfinder.census.gov/bkmk/table/1.0/en/COG/2012/ORG11.US01. While U.S. Census Bureau data did not provide a population breakout for special district governments, if the population of less than 50,000 for this category of local government is consistent with the other types of local governments the majority of the 38, 266 special district governments have populations of less than 50,000. 22 Id. 23 U.S. Census Bureau, 2012 NAICS Definitions, “517210 Wireless Telecommunications Carriers (Except Satellite),” See https://factfinder.census.gov/faces/affhelp/jsf/pages/metadata.xhtml?lang=en&type= ib&id=ib.en./ECN.NAICS2012.517210. 24 13 CFR § 121.201, NAICS code 517210. 25 U.S. Census Bureau, 2012 Economic Census of the United States, Table EC1251SSSZ5, Information: Subject Series: Estab and Firm Size: Employment Size of Firms for the U.S.: 2012 NAICS Code 517210. https://factfinder.census.gov/bkmk/table/1.0/en/ECN/2012_US/51SSSZ5//naics~517210.
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Page 163 of 188 Federal Communications Commission FCC 19-62 providing access to transmission facilities and infrastructure that they own and/or lease for the transmission of voice, data, text, sound, and video using wired telecommunications networks. Transmission facilities may be based on a single technology or a combination of technologies.”33 The SBA’s small business size standard for this category is all such firms having 1,500 or fewer employees.34 U.S. Census Bureau data for 2012 show that there were 3,117 firms that operated that year.35 Of this total, 3,083 operated with fewer than 1,000 employees.36 Thus, under this size standard, the majority of firms in this industry can be considered small. 15. In addition to U.S. Census Bureau data, the Commission’s Universal Licensing System indicates that as of March 2019 there are 1,300 licensees holding over 2,190 active EBS licenses. The Commission estimates that of these 2,190 licenses, the majority are held by non-profit educational institutions and school districts, which are by statute defined as small businesses.37 E. Description of Projected Reporting, Recordkeeping, and Other Compliance Requirements 16. We expect the rules adopted in the Report and Order will impose new or additional reporting or recordkeeping and/or other compliance obligations on small entities as well as other applicants and licensees. The Commission is not in a position to determine whether the adopted rule changes will require small entities to hire attorneys, engineers, consultants, or other professionals, and
(Continued from previous page) 26 Id. Available census data does not provide a more precise estimate of the number of firms that have employment of 1,500 or fewer employees; the largest category provided is for firms with “1000 employees or more.” 27 Amendment of Parts 21 and 74 of the Commission’s Rules with Regard to Filing Procedures in the Multipoint Distribution Service and in the Instructional Television Fixed Service and Implementation of Section 309(j) of the Communications Act—Competitive Bidding, Report and Order, 10 FCC Rcd 9589, 9593, para. 7 (1995). 28 47 CFR § 21.961(b)(1). 29 47 U.S.C. § 309(j). Hundreds of stations were licensed to incumbent MDS licensees prior to implementation of Section 309(j) of the Communications Act of 1934, 47 U.S.C. § 309(j). For these pre-auction licenses, the applicable standard is SBA’s small business size standard of 1500 or fewer employees. 30 Auction of Broadband Radio Service (BRS) Licenses, Scheduled for October 27, 2009, Notice and Filing Requirements, Minimum Opening Bids, Upfront Payments, and Other Procedures for Auction 86, Public Notice, 24 FCC Rcd 8277 (2009). 31 Id. at 8296, para. 73. 32 Auction of Broadband Radio Service Licenses Closes, Winning Bidders Announced for Auction 86, Down Payments Due November 23, 2009, Final Payments Due December 8, 2009, Ten-Day Petition to Deny Period, Public Notice, 24 FCC Rcd 13572 (2009). 33 U.S. Census Bureau, 2017 NAICS Definitions, “517311 Wired Telecommunications Carriers,” (partial definition), http://www.census.gov/cgi-bin/sssd/naics/naicsrch?code=517311&search=2017. 34 See, 13 CFR § 121.201. The Wired Telecommunications Carrier category formerly used the NAICS code of 517110. As of 2017 the U.S. Census Bureau definition shows the NAICs code as 517311 for Wired Telecommunications Carriers. See, https://www.census.gov/cgi- bin/sssd/naics/naicsrch?code=517311&search=2017. 35 See U.S. Census Bureau, 2012 Economic Census of the United States, Table No. EC1251SSSZ5, Information: Subject Series - Estab & Firm Size: Employment Size of Firms: 2012 (517110 Wired Telecommunications Carriers). https://factfinder.census.gov/bkmk/table/1.0/en/ECN/2012_US/51SSSZ5//naics~517110. 36 Id. 37 The term “small entity” within SBREFA applies to small organizations (non-profits) and to small governmental jurisdictions (cities, counties, towns, townships, villages, school districts, and special districts with populations of less than 50,000). 5 U.S.C. §§ 601(4)-(6).
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Page 164 of 188 Federal Communications Commission FCC 19-62 cannot quantify the cost of compliance with these rule changes. We do not believe however, that the costs of compliance or the administrative requirements associated with any of the rule changes will unduly burden small entities. We note that several of the rule changes are consistent with and mirror existing policies and requirements used in similar spectrum bands. Therefore, small entities with existing licenses in may already be familiar with such policies and requirements and have the processes and procedures in place to facilitate compliance resulting in minimal incremental costs to comply with the Report and Order. F. Steps Taken to Minimize the Significant Economic Impact on Small Entities, and Significant Alternatives Considered 17. The RFA requires an agency to describe any significant, specifically small business, alternatives that it has considered in reaching its approach, which may include the following four alternatives (among others): (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 or reporting requirements under the rule for 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 small entities.38 18. The Commission does not believe that the rule changes adopted in the Report and Order will have a significant economic impact on small entities. The proposed changes expanding the use of the 2.5 GHz band will benefit small entities as well as entities of other sizes by reducing unnecessary regulatory burdens on licensees, promoting greater spectrum efficiency, and facilitating the full use of EBS spectrum to provide advanced mobile broadband services, particularly in rural areas where this spectrum currently sits idle. Moreover, the adopted reforms will permit more flexible use of this spectrum by small and other sized entities that currently hold EBS licenses and will provide new opportunities for EBS eligible entities, Tribal Nations, and commercial entities to obtain unused 2.5 GHz spectrum to facilitate improved access to next generation wireless broadband, including 5G, for both educational and commercial uses. We discuss the alternatives considered to the rules adopted below. 19. Rationalizing the GSAs of incumbent EBS Licensees. In the NPRM, the Commission proposed to rationalize the current point-and-radius license areas held by incumbents to a defined geographic area. There was both support for this approach and alternatives proposed by commenters. The alternatives considered by the Commission included expansion to county borders, using self-defined GSAs, GSAs based on granular population data, and rationalization but not any expansion of geographic area coverage. Finding the benefits the Commission believed would result from its NPRM proposals are unlikely to materialize to any significant degree, and the process of rationalizing licenses is likely to be complex, time-consuming, and potentially confusing to incumbent and future licensees, the Commission declined to adopt any rationalization scheme for incumbent EBS licenses and left the existing license boundaries intact. 20. Additional Flexibility for EBS Licensees. The Commission adopted the NPRM’s proposal to eliminate the EBS eligibility requirements contained in section 27.1201 of the rules for incumbent EBS licenses, including licenses granted via waiver instead of maintaining the current requirements. This alternative allows the Commission to bring these licenses into better alignment with the flexible use licensing policies used in similar spectrum bands, which feature open eligibility absent a compelling showing that regulatory intervention to exclude potential participants is necessary and has been an effective means of promoting more efficient and better use of the 2.5 GHz band. Small entities should benefit from this increased flexibility to assign or transfer control of their licenses to entities that are not EBS-eligible. We believe that, at this point in time, licensees are in the best position to determine how to use their licenses, or, alternatively, whether to transfer their licenses to a third party in the secondary market.
38 5 U.S.C. § 603(c)(1)-(4).
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21. The Commission also eliminated the educational use requirement contained in section 27.1203 of the rules as proposed in the NPRM after considering alternative proposals to revise and/or update the requirements to reflect the current broadband use of the spectrum. In doing so the Commission did not find that any these alternatives would facilitate broadband deployment or be workable for licensees or commercial operators. Additionally, after considering alternative proposals to maintain and increase restriction on lease terms, the Commission adopted the NPRM’s proposal to eliminate restrictions on EBS leases entered into under its secondary markets policies on a going forward basis which will make the rules for the 2.5 GHz band consistent with other Part 27 services, incentivize build-out in rural areas, and provide additional flexibility to both EBS licensees and lessees. 22. Local Priority Filing Window. The Commission adopted a Tribal priority window for Tribal entities to obtain 2.5 GHz licenses on Tribal lands that are located in rural areas as proposed in the NPRM, enabling these entities to acquire all available EBS spectrum on their Tribal lands. This window will allow Tribal entities to address the educational and communication needs of their communities and provide much needed services such advanced wireless services, in areas that are devoid of such services. Conversely, after considering the priority filing window option for existing EBS licensees and for educational institutions that do not currently hold any EBS licenses, the Commission declined to adopt these windows based on a belief that windows for these entities are not the best way to achieve rapid expansion and deployment of broadband in the band. 23. Licensing of White Spaces. As proposed in the NPRM, the Commission will use competitive bidding to resolve mutually exclusive applications for the unassigned EBS spectrum after the completion of the rural Tribal priority window, finding the competitive bidding alternative is consistent with the other changes made in the Report and Order to align EBS licenses more closely with flexible use service rules. An overlay auction was determined to be the best mechanism for assigning EBS spectrum due to, among other things, the costly nature of an incentive auction to government and other participants. Thus, the overlay auction should help minimize participation costs for small entities. 24. The procedures we have adopted contain provisions to assist small entities in competitive bidding.39 The Commission will employ the Part 1 rules governing competitive bidding design, designated entity preferences, unjust enrichment, application and payment procedures, reporting requirements, and the prohibition on certain communications between auction applicants. Furthermore, qualifying “small businesses” – those with gross revenues for the preceding five years not exceeding $55 million – will be provided with a bidding credit of 15%, and “very small businesses” – those with average annual gross revenues for the preceding five years not exceeding $20 million – with a bidding credit of 25%. Providing small businesses and very small businesses with bidding credits will provide an economic benefit to small entities by making it easier for small entities to acquire spectrum or access to spectrum in these bands. 25. Geographic Area and the Band Plan for New Licenses. The band plan adopted in the Report and Order will include three overlay licenses - the first license will include channels A1-A-3, B1- B3, C1-C3 (49.5 MHz); the second license will include channels D1-D3, the J channels, and channels A4- G4 (50.5 MHZ); and the third license channels G1-G3 and the relevant EBS K channels (16.5 megahertz of contiguous spectrum and 1 megahertz of the K channel associated with the G channel group). This arrangement will give applicants two wide blocks and one small block from which to choose, providing opportunity for small entities participate as well as medium and large entities with different needs. 26. Requirements for New 2.5 GHz Licenses. Regarding performance requirements, the alternatives considered by the Commission were broadly speaking, robust requirements (including the Commission’s proposal), relaxed requirements (including the current substantial service standard), or the general concept of a build-out requirement without specifics. The Commission adopted the robust mobile, fixed and broadcast performance requirement metrics from the NPRM for new licensees in the
39 See Report and Order, paras. 213-214.
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Page 166 of 188 Federal Communications Commission FCC 19-62 band, which will promote the deployment of wireless services for multiple purposes including education. With respect to the timeline for evaluating build-out, the Commission required that the interim benchmark be applied after four years, and that the penalty for failure to make this showing be the acceleration of the final benchmark deadline to six years, rather than eight years. This approach is largely consistent with our rules for other bands and will help harmonize the regulatory regime of the 2.5 GHz band with other commercial wireless services. Additionally, the Commission will apply the Wireless Radio Services (WRS) framework of renewal standards to both new and existing EBS licensees. The Commission anticipates that updating the performance requirements in this manner will encourage rapid deployment of next generation wireless services, including 5G, which will benefit small entities and the industry as a whole. 27. Pending Waiver Requests and Cleaning Up the 2.5 GHz Rules. Small entities should benefit from the Commission’s removal of the filing freeze for new EBS licenses, which will provide them greater opportunity to obtain EBS spectrum to meet the needs of their communities. In conjunction with removing the filing freeze, the Commission will dismiss three pending requests to waive the freeze for new EBS licenses. Small entities should also benefit from the Commission’s clean-up of the 2.5 GHz rules by eliminating the BRS/EBS transition rules which were completed in 2011 and making non- substantive, clarifying amendments to Section 27.1206, making it is easier to understand. Report to Congress 28. The Commission will send a copy of the Report and Order, including this FRFA, in a report to Congress pursuant to the Congressional Review Act.40 In addition, the Commission will send a copy of the Report and Order, including this FRFA, to the Chief Counsel for Advocacy of the SBA. A copy of the Report and Order, and FRFA (or summaries thereof) will also be published in the Federal Register.41
40 See 5 U.S.C. § 801(a)(1)(A). 41 See 5 U.S.C. § 604(b).
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APPENDIX C
List of Commenters to NPRM
Comments
Adam Miller Ak-Chin Indian Community (Ak-Chin) American Indiana Higher Education Consortium (AIHEC) Amelia Academy American Petroleum Institute (API) American’s Public Television Stations and Corporation for Public Broadcasting (APTS-CPB) AT&T Bad River Band of the Lake Superior Tribe of Chippewa Indians (Bad River) Bridge the Divide Foundation, Inc. and Rocky Mountain Broadband, LLC (Bridge the Divide) Competitive Carriers Association (CCA) Charter Communications, Inc. Chemehuevi Indian Tribe (Chemehuevi) Chester County Interlink Chickasaw Nation Coeur D'Alene Tribe Confederated Tribes of the Colville Reservation (Colville) Consortium for School Networking (CoSN) Digital Wish Educators and Broadband Providers for American Rural Communities (EBPARC) Educational Broadband Corp. (EBC) Gallatin Wireless Internet, LLC (Gallatin) Hackett School District Happy House Daycare Havasupai Tribal Council (Havasupai) Hispanic Information and Telecommunications Network, Inc. (HITN) Hopkins Public Schools Imperial County Office of Educational/California K-12 High Speed Network (CA K-12 HSN) Kings County Superintendent of Schools (Kings County) King George County Schools Kristen Perry Nebraska Department of Education, Nebraska Educational Television, and State of Nebraska Office of the Chief Information Officer (Nebraska) Lawrence County School System Love Covenant Christian School Maria Hadden Midcontinent Communications (Midco) Mural Net Northern Arizona University Foundation (NAUF) National Association of Broadcasters (NAB) National EBS Association and Catholic Technology Network (NEBSA/CTN) National Congress of American Indians (NCAI) National Digital Inclusion Alliance (NDIA) Native Public Media (NPM) Nez Perce Tribe (Nez Perce) North American Catholic Educational Programming Foundation and Mobile Beacon (NACEPF) North Carolina Department of Information Technology, Broadband Infrastructure Office (North Carolina) 66
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Northern Michigan University (NMU) NTCA-The Rural Broadband Association (NTCA) PCs for People R Street Institute Rural EBS Coalition: Adams Telephone Co-Op, Cass Cable TV, Central Texas Communications, Coleman County Telephone Coop, Colorado Valley Communications, Etex Communications, Mahaska Communication Group, Mark Twain Communications Company, Public Service Wireless, Texas RSA 7B3 LLC dba Peoples Wireless (Rural EBS Coalition) Schools, Health & Libraries Broadband Coalition (SHLB) School Superintendents Association and Association of Educational Service Agencies (AASA/AESA) Select Spectrum LLC (Select Spectrum) South Florida EBS Licensees: School Board of Miami-Dade County, School Board of Broward County, School Board of Palm Beach County, Florida Atlantic University, Florida Gateway College (South Florida EBS) Sprint Corporation (Sprint) State Educational Technology Directors Association (SETDA) Technology Policy Institute (TPI) TechSoup Global T-Mobile USA, Inc. (T-Mobile) Torstrick Ministries, Inc. Utah Education and Telehealth Network (Utah) Verizon Virgin Islands Telephone Corp. (VIYA) Voqal Wireless Communications Association, International (WCAI) Wireless Internet Service Providers Association (WISPA)
Reply Comments
AT&T Bridge the Divide Chickasaw Nation Community Telecommunications Network, Inc. and Michigan Educational Technology Leaders (CTNI/METL) EBPARC EBS Parties Friday Institute for Educational Innovation at North Carolina State University (Friday Institute) Gallatin HITN Midco Mural Net NEBSA/CTN NACEPF National Tribal Telecommunications Association (NTTA) Northern Arizona University Foundation (NAUF) NTCA Pueblo de Cochiti Rural EBS Coalition Santa Fe Indian School Select Spectrum Source for Learning, Inc. (SFL) Sprint
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T-Mobile Tribally-Owned and Tribally-Controlled Rural Telecom Entities: NTUA Wireless, LLC and Mescalero Apache Telecom, Inc. (NTUA/Mescalero) University of Cincinnati Views on Learning, Inc. (VOL) Voqal WCAI WISPA
Ex Parte Comments
A Better Wireless American Library Association (ALA) API APTS APTS, Vegas PBS, South Carolina Educational Television Commission, Detroit Public Television AT&T BeamSpeed, LLC, Evertek, Inc., Redzone Wireless, Rise Broadband, SiouxLan Communications, Watch Communications Carolina West Wireless, Cellular Network Partnership d/b/a Pioneer Cellular, Viaero Wireless, AST Telecom, Inc. d/b/a BlueSky Chickasaw Nation/Trace Fiber Networks CoSN, SETDA, SHLB, ALA, National Digital Inclusion Alliance, EBPARC Countrymen Communications, Inc. CTNI/METL United States Department of Education, Office of Planning, Evaluation, and Policy Development (Dept. of Ed.) EBPARC Etex Communications, L.P. Intel Corporation Mark Twain Communications Midco MuralNet MuralNet, Northern Arizona University, Office of Native American Initiatives, Southern California Tribal Chairmen's Association Tribal Digital Village NACEPF National Association of State Boards of Education/Council of Chief State School Officers National Collaborative for Digital Equality NCAI Nebraska NEBSA/CTN NTCA NTTA, Mescalero Apache Telecom, Cheyenne River Sioux Tribe Telephone Authority, Tohono O’odham Utility Authority, Gila River Telecommunications, Saddleback Communications, Sovereign Council of Hawaiian Homestead Association, Alexico NMU ONE Media 3.0, LLC PCs for People Robert Kramer Rural EBS Coalition “Save EBS Sign on Letter” SETDA
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SETDA and CoSN SHLB, Nebraska, Virginia Department of Education SHLB, NACEPF, Mobile Beacon, Voqal, National Digital Inclusion Alliance and Public Knowledge Sprint Sprint/MidCo/WISPA/WCAI/CTN/NEBSA/Voqal/NACEPF/Mobile Beacon Tech Knowledge U.S. Cellular Corp. Verizon VIYA Voqal Wayne State University, CTNI and NEBSA Wayne State University, NMU, Newaygo County (MI) Regional Educational Service Agency, Mecosta- Osceola (MI) Intermediate School District WCAI WISPA WISPA, JAB Wireless
Express Comments Aaron Read, Rhode Island Public Radio Aaron Velky Ahren Sievers, Elmwood Park Public Library Akiba Byrd Alan Gibbons-Cache Country School District Aleph Bet Jewish Day School Allan Schneider Amanda Lange Amy Baker, Pyper Powell, Shyra Merial, Ben Paz, Jim Saxon, Pam Dean, Scott Kenyon, Amanda Chaloux, Meghan McKee, Clatsop Behavioral Healthcare Amy Sieving, Wilkinson Public Library Amy Smift Andrew Moore Andrew Wallace Andy Boell Andy Coleman Ann Stovall, Indian Prairie Public Library Annmarie Lehner, Rochester City School District April Leese April Soltis Arline Pique Ashley from Moline, IL Barbara Haeffner Barbara K Iverson, Chicago Instructional Technology Foundation Barbara Laub, Maplewood Memorial Library Becky Rohr Head, Lucius Beebe Memorial Library Becky Schott Beth Franke, John Stark Regional HS Beverly Horner Bill Heimann Bo Thomas Brad Ecret Brian Tobin Carolyn Primeau
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Cassie Bair Cathy Laliberte, Tina Swarr, Mary Gomez Center for the Advancement for Healthcare Education and Delivery Chantall Manahan Charles Marr, PRETC Charles Meyers, Secret Expressions, Inc Chillicothe Public Library Chris Kauffman, Wayfinders Churches Cindy Bingham Closing The Digital Gap (501c3 Non Profit) Coby Culbertson, Dubuque Community School District Coffee County Schools Cole Ferrier Colin Webb, Oklahoma Technology Association Courtney Hayden, Alliance for Innovation, Craig Chatterton Craig Liggett Creighton Community Foundation, Inc., Jeff Boles Custom Collaborative Cynthia Farrell Damien Bertwell Dan Ellsworth Daniel Matthews Daniel X. O’Neil, Chicago Instructional Technology Foundation David Asbury, Gadsden City Schools David Camara David Fringer David Hartz, University of Cincinnati Blue Ash College David L. Charles, Colorado Computer Museum David Liss David Long David McGeary David Powell David Vincent, U.S. Crisis Care David Wu Davida Elsbree Pathways Charter School Debbie Werbrouck, Patchwork Dance Company Deborah Ketring, Copper Country Intermediate School District Denise Blok Denise Robinson, Brownsburg Public Library Diane Johnson Don Ringelstein West Aurora School District 128 Doug Brubaker Douglas H. Hawley, AHA Board of Directors Douglas Kiang Dr John Vandewalle Dr Rich Contartesi Dr. Michael Christianson, M. Esq., JUD Dr. Susan M. Clair, Bobby F. Keener, Jr., Virginia Department of Education Edward Garcia, Cranston Public Library Emily Faulkner Emmanuel Zapata, Top of Form Foundation Communities
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Enoch Kindseth, Normal Public Library ERHAN SAYGIN Eric Lochtefeld Erika Verplanck Family Bridges Francisco Zavala George C. Avent, Jr. Giuseppina Azzolini Grover Dailey Hays County Food Bank, Hearts for Hearing Foundation International Cancer Advocacy Network (satellite office) J. Todd Watkins, Huntsville City Schools Jackie Icenhower James Martin James Traynor, Instructional Telecommunications Foundation Jamie Brambley, Fulton County Library Jane Lenser, Cherry Valley Public Library District Jared Hardy Jason Eyre Jason Genovese Jason Karabulut, Ali Cingilli, Sonoran Science Academy - Phoenix campus Jazz@STJ Jeff Hauser, Hands In Motion Jeff Osborn, Windemere Ranch Middle School Jennifer Rowan Jered Weber Jerome Browning Jill McConnell, Community Library Association Jim Hoerricks, Towcester Abbey Joe Dusenbery Joe McGrath Joe Saponare John Petersen John Riner Jolene Franciskovich, Coal City Public Library District Joon Kim, Brentwood School Josh Claseman, Pineview Park BMX Josh Snow, Chickasaw Nation Joshua Luckhaupt Julia Delpino Julie O'Neill, Mercer Veterinary Clinic for Pets of the Homeless Karen Dini, Addison Public Library Karen Marchese, Be Proud Foundation Karen Nave Kate Tranquada Keely Gilliland, UnifiEd Kelly Dumont, Kelly May, Vollmar Kent County, MD, Kent County Government Kevin Slusher Kim Browning
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Kris Hagel Kurt Bernhardt Kyle Gunning, Center for Head Injury Services Lane Education Service District Laura Kindsvater Lauren Jenkins LeRoy Rose, Jr., Campus Safety & Security at the Providence Campus of Johnson & Wales University Linda Conn, Cary Area Public Library Lois Neustadt, Elyssa's Mission Louise Lee, Butte College Luann Hughes Lynn Dennis, Roselle Public Library District M. Jill Davis, Hope Distributed Community Development Corp Madeira Historical Society Maine Educational Technology Directors Association Margie Padilla Marty Mosley, Legacy Christian Academy Mary Klimack, Sand Lake Town Library Matthew Tavianini, Boxtales Theatre Company Megan Juenemann Michael Wagman Michelle R Mears Miranda Lee, Word of Grace Chinese School Mitch Randall Mitchell Owens Molly Fohn Nancy Rose Natalie DeJarlais Nayat M'hamed Neal Gosman Nick Claypool Nick Ziegler, PhD Nicole Steeves, Fox River Grove Library Nicole Trimble University of Cincinnati Blue Ash College Open Access Connections Pamela Leffler, Morton Grove Public Library Patricia Castillo Patricia Hall, The North Carolina Music Educators Association Patrick Babcock Peggy Ganong, The New Milford Public Library Pennye Nixon, Etta Projects Phil Carolan, Lenawee/Monroe Technology Consortium Phillip Whitford, Braswell Memorial Library Portland Community College Randall Wood Rayna Freedman, MassCUE Rebecca Evans, Sanislo Elementary School Richard J. Muller Richard White, Central Berkshire Regional School District Robbie Smith, Safe Harbor Haven Inc Robin Adkins, Edward Chipman Public Library Rod Carnill
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Rodney Fielding, Virginia Search & Rescue Rodney Rowland, Dunn Police Athletic & Activities League, Inc. Ronald E. Pleasant Ronald L. Cone Ryan McDowell Samantha Millsap, Roselle Public Library District Samuel Jordan, Alaska Department of Education and Early Development Sarah Loudermilk, Houston Youth Symphony Scott Pierce Shane Alexander, Bloomfield Community Schools Sheila Ailes Someone in Grand Prairie, TX St. Charles Borromeo Catholic School St. Michaels Academy Stan Freeda Stan Schulman, Our Bedford Riding Lanes Association Stefan Peierls Stefanie R Sullivan, Reddick Public Library Stephen Jacobs Steve Hargis, City of Moreno Valley, California, Public Library Stuart Long SunCoast School Susan Moore Suz Rice Suzanne Banas, Ph.D Ted Stark, Menomonie Public Library Telecommunications Users Group Terrance McCreary and Brandie Abraham-McCreary The Learning Accelerator The River Line Historic Area, Inc. The S.A.V.E Program Thom Hartmann, Portland Regional Educational Telecommunications Corporation Tim Fears Tim Lucas, Lewiston Consolidated School District #69 Timothy Allchin Tom Ingram Tracy Oster Vedic Cultural Center of San Diego Vic Spain, Tidewater Oyster Gardeners Association Vicki Bates Victoria Sandin, Technology Librarian Rodgers Memorial Library Wayne Beasley Wayne Wiens Wilhelmina Bandler
Informal Comments filed after the deadline
David Foemmel Krista Gromalski, Coal Cracker Kids Opera MODO Ron Taylor, Patterson Historical Society Rutland Northeast Supervisory Union
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STATEMENT OF CHAIRMAN AJIT PAI
Re: Transforming the 2.5 GHz Band, WT Docket No. 18-120
In 1963, a band from Liverpool released their debut studio album, Please Please Me, hoping to revolutionize the music industry.1 That same year, the FCC fell in love with a different band—the 2.5 GHz band—and decided to establish rules to allocate that band for educational television services. Over half a century later, one band continues to occupy the airwaves, while in large part, the other is nowhere to be found. If you need a hint as to which band is which, I’ll just say, sadly, that the FCC doesn’t have jurisdiction over the Beatles.
But we do have control over the 2.5 GHz band. This is the single largest contiguous swath of mid-band spectrum below 3 gigahertz in the nation. And given its combination of coverage and capacity, it presents a big opportunity for 5G. But today, this valuable public resource is dramatically underused— especially west of the Mississippi River. That’s partly because technological advances have rendered the original intended uses outdated, and partly because arcane rules have hampered providers from putting the spectrum to its highest-valued use.
Just as making available high-band spectrum for commercial use is critical to the development and deployment of 5G in the United States, so too is opening up mid-band spectrum. As Commissioner Rosenworcel has noted, “[f]or the United States to have secure 5G service available to everyone, everywhere, . . . [w]e need to make it a priority to auction mid-band airwaves right now.”2 I agree. She has advocated for this agency to “explore innovative opportunities for making more efficient use of the 2.5 GHz band.”3 I agree. And she has observed that the 2.5 GHz band “is the spectrum that can make 5G happen in our rural communities,” and that it “is a really big piece of the puzzle for 5G.”4 I agree.
So today, the Commission majority takes a major step toward freeing up critical mid-band spectrum for 5G. At long last, we remove the burdensome restrictions on this band, allowing incumbents greater flexibility in their use of the spectrum, and introduce a spectrum auction that will ensure that this public resource is finally devoted to its highest-valued use. These groundbreaking reforms will result in more efficient and effective use of these airwaves and represent the latest step in advancing U.S. leadership in 5G.
We also give rural Indian tribes an exclusive window to obtain this spectrum to serve Tribal lands. Here’s why. As I’ve seen for myself—from the Rosebud Sioux Reservation in South Dakota to the Navajo Nation in Arizona, from the Coeur D’Alene Reservation in Idaho to the Jemez and Zia Pueblos in New Mexico—the digital divide is most keenly felt in Indian Country. I want to make sure that those committed to connecting Tribal members in rural areas are given a strong opportunity to
1 THE BEATLES, PLEASE PLEASE ME (EMI Studios 1963).
2 Jessica Rosenworcel, Choosing the Wrong Lane in the Race to 5G, WIRED (June 10, 2019), https://www.wired.com/story/choosing-the-wrong-lane-in-the-race-to-5g/. 3 Allocation and Service Rules for the 1675-1680 MHz Band, Notice of Proposed Rulemaking and Order, FCC 19- 43, 2019 WL 2098514 (May 13, 2019) (Statement of Commissioner Rosenworcel), https://docs.fcc.gov/public/attachments/FCC-19-43A4.pdf.
4 Monica Alleven, Rosenworcel: 2.5 GHz spectrum key for 5G in rural areas, FIERCEWIRELESS (Jan. 23, 2019), https://www.fiercewireless.com/wireless/rosenworcel-2-5-ghz-spectrum-key-for-5g-rural-areas.
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Following the Tribal priority window, the remaining unassigned 2.5 GHz spectrum will be made available for commercial use through a spectrum auction. The 2.5 GHz auction, which the FCC intends to hold next year, will put this spectrum to its most valuable use for the American people.
Accordingly, we decline to adopt priority windows for non-incumbent educational institutions or incumbent licensees. Here’s why. Experience suggests that the past is highly likely to be prologue. And today, an overwhelming number of today’s EBS licensees lease an overwhelming amount of EBS spectrum out to wireless companies. They don’t use it for educational purposes. Indeed, over 95% of current license-holders for our 2,193 EBS licenses today lease much of this spectrum to non-educators. The FCC abiding this longstanding arbitrage has been unhelpful to consumers for many years. Given today’s imperative of 5G leadership and consumer demand for advanced wireless services, the FCC extending this middleman model even further would be nonsensical. And as Commissioner Carr’s recent inquiries have suggested, the FCC would be foolish, if not derelict in its duty, to allow entities to monetize this spectrum nationwide for purposes that have little to nothing to do with educating children. That would exacerbate rather than close the homework gap.
One other point. It’s been 427 days—fourteen months to the day—since we started the 2.5 GHz proceeding. One of my colleagues suggested—yesterday—that we hold an incentive auction in this band with no details offered whatsoever on how to do so. Of the many problems with that suggestion, one stands out: It would delay an auction of this key mid-band spectrum by several years, according to our career staff, thus substantially slowing down progress on 5G. I believe that we need to make it a priority to auction mid-band airwaves right now—not in several years’ time—and accordingly, I am not willing to support such a delay.
Moreover, it is important to remember the significant public interest benefits that follow from the approach we take today. We adopt an overlay auction with county-size licenses. We adopt a band plan that benefits small and large entities alike. And we also adopt bidding credits for small entities. This approach would encourage small companies to participate—companies like Midco, Carolina West Wireless, Pioneer Cellular, Viaero Wireless, AST Telecom, Waive Wireless, and Paladin Wireless. You may not have heard or some or any of these providers. And that’s kind of the point. These are the foot soldiers of the digital revolution in rural and low-income America. These are the entities that will use this public resource to benefit the entire public. These are the companies that support the approach we’re taking today.
Of course, today’s milestone in mid-band spectrum does not stand alone. Later this summer, we aim to approve initial commercial deployments in the 3.5 GHz band, and we intend to hold an auction in the 3.5 GHz band next year. Moreover, thanks to the reforms we adopted last year, carriers that win licenses in that auction will be able to efficiently deploy 5G in the band. We’re also working on the complicated task of freeing up spectrum for 5G in the 3.7-4.2 GHz band, commonly called the C-band. I’m optimistic that we will have results to show on this front this fall. And of course, our work on low- and high-band spectrum opportunities continues apace.
My thanks to those staffers working to help make the 5G digital revolution a reality. Today’s important steps would not be possible without the help of Erin Boone, Stephen Buenzow, Jonathan Campbell, Melvin Del Rosario, Diane Dupert, Garnet Hanly, Tim Hilfiger, Chris Miller, Darrel Pae,
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Matthew Pearl, John Schauble, Catherine Schroeder, Becky Schwartz, Blaise Scinto, Christiaan Segura, Dana Shaffer, Nadja Sodos-Wallace, Cecilia Sulhoff, and Nancy Zaczek from the Wireless Telecommunications Bureau; Catherine Matraves, Jonathan McCormack, Giulia McHenry, Patrick Sun, Emily Talaga, and Margaret Wiener from the Office of Economics and Analytics; Matthew Duchesne, Barbara Esbin, and Sayuri Rajapakse from the Consumer and Governmental Affairs Bureau; Chana Wilkerson from the Office of Communications Business Opportunities; and David Horowitz, Keith McCrickard, and Bill Richardson from the Office of General Counsel.
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STATEMENT OF COMMISSIONER MICHAEL O’RIELLY
Re: Transforming the 2.5 GHz Band, WT Docket No. 18-120
In many areas of the U.S., the Educational Broadband Service (EBS) band never lived up to expectations. After a protracted history of wishful thinking that included educational broadcasting and then broadband opportunities for schools and non-profit institutions, we are mostly left with an inefficient system of commercial broadband leases, continuous licensing freezes, and underutilized spectrum. I recognize that certain educational institutions took advantage of their licenses and constructed networks, but they are few and far between. This situation warrants a new approach, one that moves the pendulum towards the Commission’s well-established flexible use policies.
Today’s item takes such a step by removing the educational restrictions on these licenses, fostering a more vibrant secondary market, and dusting off the bandwidth sitting in the FCC inventory by ordering an overlay auction where there is currently unlicensed spectrum. As such, the item generally moves in the right direction, and I applaud the Chairman for his leadership, even if I may have opted for tribal bidding credits rather than a tribal priority window. However, I certainly appreciate that the Chairman added stringent buildout requirements for licenses obtained in this set-aside. Every tribal EBS licensee should be on notice: if you don’t build, the license will be cancelled.
On a broader note, it is fair to say no one can truly predict who will be interested in participating in this auction, and there is unlikely to be a mad rush for these licenses. While a winning bidder would obtain an overlay license, the only guarantee is the right and obligation to serve 80 percent of the white space population, not a larger area such as the unserved portion of a market. This may ultimately discourage some of our largest providers from participating in the auction.
Moreover, this proceeding is fundamentally about making slivers of spectrum available in those areas where it is not licensed. While additional spectrum opportunities in rural – or non-urban – markets are important, the lack of available spectrum in the largest markets makes it hard to characterize this as a true mid-band play for 5G or next-generation services. Accordingly, I certainly welcome and appreciate the Chairman’s statements from last week indicating that the 3.5 GHz auction will occur in the first half of 2020; that there is likely to be a C-band item this fall; and that progress is being made on commercial use in the entire 3.1 to 3.55 GHz band. These are issues I have been working on for years to effectuate, and this is very welcome news for America’s 5G outlook. I look forward to engaging further on these matters and reviewing the forthcoming items.
On this item, I approve.
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STATEMENT OF COMMISSIONER BRENDAN CARR
Re: Transforming the 2.5 GHz Band, WT Docket No. 18-120
Today’s vote brings more good news for U.S. leadership in 5G.
The Order before us helps clear a massive amount of prime, mid-band spectrum for 5G—200 MHz in total. This spectrum is an important input to a successful 5G deployment because it has capacity and coverage characteristics that make it well-suited for next-gen connectivity. In fact, one nationwide carrier is using parts of this very spectrum today for 5G. It’s providing uninterrupted coverage to people traveling across a city, with continuous streams of hundreds of megabits per second on the go.
Of course, mid-band spectrum is not the only necessary input for a successful 5G build in the U.S., even though you might think that based on the latest D.C. talking points. Here’s the reality. For the U.S. to win the race to 5G—to see not only the full range of next-gen services but to see them in communities across the country—we need a strategy that opens up high-, mid-, and low-band spectrum. And that’s why this FCC has executed on an all-of-the-above approach.
Take our efforts on high-band spectrum. Several carriers have already gone live with 5G offerings using this spectrum. They’re hitting peak speeds of two gigabits per second to customers’ phones. And they’re providing many families with their first taste of competition for in-home broadband. Bringing this new competition to home broadband is wildly popular with everyday Americans. And this 5G service works best with high-band spectrum. Carriers are not hitting multi-gig, fiber-like speeds in these markets on mid-band spectrum.
Low-band spectrum, in turn, is one key to making sure rural America is not left behind in our upgrade to 5G. One carrier alone has committed to covering 90 percent of rural households with 5G using its low-band holdings. This will mean at least 50 megabits per second for farms and ranches that today don’t have a single option for broadband. Bringing 5G to these sparsely populated communities is not a mid- or high-band play alone.
And that brings me to today’s decision, which complements all these efforts. A lot of work went into opening up this 200 MHz of mid-band spectrum. And that work didn’t even start until 2018 when this FCC launched this rulemaking. Prior FCCs probably put off this effort because the path forward presented challenges. A lot of that has to do with the history of this band. It’s a history that tracks the evolution of the FCC, from an agency that placed too much weight on its own predictive judgments to one that prefers flexibility and bottom-up experimentation.
These 2.5 GHz licenses were created in 1963 for schools to transmit video programming. The idea was that a school district might have instructional videos that it wanted to beam from a central office to a neighborhood school. Educators, on tight budgets, weren’t likely to have the capacity or know-how to self-provision a niche technology. And so the original service, called ITFS, stagnated. Over the next 55 years, companies figured out ways to make use of the band often in spite of our rules, first for commercial video networks, and later for mobile broadband.
Creative entrepreneurs deserve credit for stitching together this spectrum. They have layered narrow bands of circular-shaped licenses—which reflected the band’s original purpose, television transmission—to create wider channels for broadband. Yet because of the FCC’s decades-old history in the band, it’s still saddled with ribbons of white spaces and rules that encumber its most valuable uses. Indeed, about half of the U.S. is not even covered by a 2.5 GHz license today.
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The Order frees the spectrum from the misguided choices of FCCs past. It makes the licenses flexible-use, which technology and the market show us will power 5G. It modernizes the licenses’ shapes by auctioning the white spaces and encouraging geographic consolidation. And it relies on market forces—rather than a protracted or reticulated FCC process—to quickly and fully rationalize the spectrum for 5G. This means mid-band for 5G today.
Now, some will tell you that we shouldn’t take these steps to free up mid-band spectrum. They say this spectrum is for kids and schools. They pit winning the race to 5G against education, creating the illusion of a binary choice. But when you scratch the surface of their claim and see what’s underneath it, I can tell you it’s not the kids.
The original 2.5 GHz licenses were given only to accredited educational institutions and government entities engaged in the formal education of enrolled students. The FCC later opened a small window of license eligibility but only for nonprofits and only if their purposes were educational and they produced instructional video content. The idea was that valuable spectrum should be given away only to entities that need it to educate kids.
In the course of examining the 2.5 GHz licenses at issue in this order, I discovered that many of these national organizations are using this valuable public spectrum that they got for free for activities far removed from kids and schools. They are not laser-focused on closing any homework gap. They are not devoting all of their energy to kids still stuck on the wrong side of the digital divide. It turns out, they’re liquidating the spectrum and spending cash on pet projects. Political campaigns. Buying a non-GMO farm. Even pocketing millions of this tax-free money for themselves. These practices may not only violate FCC rules, but, in some cases, federal tax law as well.
So last week, I started an inquiry by sending letters to some of these national organizations. We need to get to the bottom of their shady practices. And we need to hold them accountable for any wrongdoing.
To further my efforts, I am glad my colleagues agreed to include language in today’s decision that directs the Enforcement Bureau and the Wireless Telecommunications Bureau to review these existing license holders for compliance with our rules and other applicable laws. Strong enforcement is especially important now because this Order allows national nonprofits and all other 2.5 GHz holders to sell their licenses, potentially at great profit. Those resources should go to kids and schools, not shady middlemen, not rent-seekers, and not scam artists.
I also think the FCC should demand much more from these and other EBS license holders than we’ve been getting. The current 30 percent buildout obligation is out of step with the performance requirements we impose on other wireless licensees. I proposed that we increase buildout on existing EBS licensees to 80 percent, and although we do not take that step in this Order, the Order now creates the procedural path to accomplishing that in a pending rulemaking.
With these changes in place, a vote for this item is a vote to return the focus to kids and schools. It’s a vote for 5G. And a vote for the next item up on our agenda is another vote for more 5G. Together, these two items put up for auction more spectrum than at any time in the FCC’s history, and they enable the clearing of prime 5G spectrum to rival any country in the world.
I am proud of the work this FCC has done on spectrum and infrastructure to secure U.S. leadership in 5G. I am glad to vote in favor of more mid-band spectrum for 5G today. I want to thank the Wireless Bureau for its work on this item. It has my support.
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STATEMENT OF COMMISSIONER JESSICA ROSENWORCEL APPROVING IN PART, DISSENTING IN PART
Re: Transforming the 2.5 GHz Band, WT Docket No. 18-120
In 1960, when Senator John F. Kennedy was roaming the country, campaigning for the highest office in the land, he described television as having “the potential to teach more things to more people in less time than anything yet devised.” I’m struck by those words about the educational power of television. That’s because they sound so much like the ones we use today to describe the power of broadband for our schools and students.
His enthusiasm for educational television did not end with the presidential campaign. In 1962, President Kennedy signed the Educational Television Facilities Act, which provided the first funds to noncommercial broadcasting. At the signing ceremony, he was accompanied by Newton Minow, his hand-picked chairman of the Federal Communications Commission. Of course, Newton Minow famously had his doubts. A year before the passage of this law he called television “a vast wasteland.” But a year after passage, Chairman Minow set out to make educational television a reality. Under his leadership, in fact, this agency introduced Instructional Fixed Television Service, or ITFS.
ITFS made its home in the 2.5 GHz band. Licenses were distributed to educational institutions committed to delivering instructional television services to schools. It was a grand idea. Use the power of broadcasting to teach. Remake education. But history shows that even with all this enthusiasm for instructional television, many ITFS licensees had difficulty making full use of their spectrum. So over time the FCC permitted educational licensees to use these airwaves in another way and lease excess capacity for commercial use.
Fast forward to 2004. The FCC took another look at ITFS. It renamed it the Educational Broadband Service, or EBS. But it did more than just rebrand these airwaves, it sought to reimagine their possibilities by encouraging their use not just for instructional television, but for educational broadband. Some truly promising efforts to ensure online access for students followed, in communities as diverse as Albermarle County, Virginia; Marquette, Michigan; and Desert Sands, California. But not every licensee has been able to put this spectrum to the educational use the FCC imagined. So last year, the FCC released yet another rulemaking to address the 2.5 GHz band.
This brings us to the present and this decision. This order turns its back on the schools and educational institutions that have made the 2.5 GHz band their home since 1962. Today the FCC takes the innovative effort to infuse this band with learning opportunities—an initiative that dates back to the Kennedy Administration—and reverts to uninspired and stale commercial spectrum policy.
This is a shame. Instead of using these airwaves in creative ways, we take the 2.5 GHz band, cut education from its mission and collapse this spectrum into an overlay auction system that structurally advantages a single nationwide carrier.
It didn’t have to be this way.
I think the educational history of this band is important. I think it should inform our effort to put this band to greater use for next generation wireless services. I think instead of this uninspired overlay auction we should be doing something bold. We should be doing something creative. We should be doing something that honors the past in this band but takes it firmly into the 5G future.
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There’s a way to do this. Let me describe how.
In 2012, Congress gave the FCC the authority to use innovative market mechanisms to nudge more spectrum into commercial wireless markets. We used this authority for the first time in 2016 to do something that had never been tried before. We tested the proposition that existing spectrum licensees might voluntarily relinquish their rights in exchange for a portion of the proceeds of the subsequent reauction of their airwaves for new flexible use. We dubbed this effort—which took place in the 600 MHz band—a voluntary incentive auction.
That auction concluded in 2017. Regulators globally took note. But we didn’t stop there. We didn’t hang up our hats after addressing only the spectrum needs of our private companies. We recognized that we had public problems to solve and that this auction process could help.
So we blazed a trail for another first. With the blessing of Congress, we took the revenues raised from our first-ever incentive auction and used them to connect first responders across the country to a nationwide network for public safety with blazing-fast facilities. This first responder network is helping law enforcement, firefighters, and emergency medical technicians save lives and protect communities across the country.
I don’t think there is any shame in copying a good idea. We should take this model and reimagine it for education in the digital age. While our first incentive auction connected first responders, our next could free mid-band spectrum for 5G and connect students.
Here’s why this is important. Today, seven in ten teachers assign homework that requires access to broadband. But FCC data show that as many as one in three households do not subscribe to broadband service. Where these numbers overlap is what I call the Homework Gap.
The Homework Gap is real. The Associated Press tells us that it affects nearly one in five students in the United States. For students in homes without broadband, just getting nightly schoolwork done is hard. I’ve seen it firsthand in rural areas, urban areas, and everywhere in between. Kids sitting in parking lots late into the evening just to get a signal to do their nightly schoolwork. Students sliding into booths at fast food restaurants every afternoon to do their homework with fizzy drinks and fries. Parents cobbling together connectivity trips to the homes of relatives and libraries with limited hours just to help their children get their assignments done.
It shouldn’t be this hard. We should do something about it—and the 2.5 GHz band presents a perfect place to start.
This is how it would work. The FCC has unused 2.5 GHz licenses in inventory. It has the authority to hold another voluntary incentive auction. Existing EBS licensees could then make a choice, keeping what they have today or returning their airwaves for compensation they could use to get the resources they need for education in the digital age. Doing so would require addressing license size, long-term leasing, and other issues unique to the band. But if we were to combine these two sources of 2.5 GHz spectrum, we would be able to hold a substantial nationwide auction for new, flexible, commercial use of key mid-band airwaves vital to 5G service.
Then, we could take the funds raised in this nationwide auction and solve the educational challenge that affects students all across the country. We could close the Homework Gap. These funds could be use to support connectivity for millions of students who lack broadband at home—through loans of wi-fi hotspots at school libraries and other creative programs—to ensure that no child is left offline.
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Here's the kicker. We could do this in short order. Just look at the 37, 39, and 47 GHz bands, where we moved from public notice to a modified incentive auction in just nine months. In fact, the innovative voucher mechanism we adopted for these bands could be used in the 2.5 GHz band as well.
In short, we could honor what President Kennedy and his allies tried to do decades ago when they sought to spark educational use in the 2.5 GHz band. We have an opportunity now to nod to his history but do it in a way that is thoroughly modern and helps make sure every student has the connectivity they need for schoolwork. I regret that we do not do it here. So I dissent.
However, there is one thing I think today’s order gets right and that’s the decision to preserve a filing window for Tribal entities seeking spectrum licenses. For too long those in these communities have lacked meaningful access to modern communications. Native Americans should not be the last Americans with access to broadband. Addressing this problem will take more than what we do here, but it’s an initiative that I support and the lone aspect of today’s decision that I approve.
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STATEMENT OF COMMISSIONER GEOFFREY STARKS APPROVING IN PART, DISSENTING IN PART
Re: Transforming the 2.5 GHz Band, WT Docket No. 18-120
“Today our schools and colleges face a crisis of appalling proportions in terms of deficits in dollars, teachers, classrooms and services. American progress and even our national survival is directly dependent on what we as a nation do now….”
Those words were written in 1960 by President Kennedy, and unfortunately, they still ring true today. Our children’s education is one of the most important investments that we as a society can make. President Kennedy saw the potential of television spectrum, calling it “a device which has the potential to teach more things to more people in less time than anything yet devised.” That insight led the FCC to set aside the 2.5 GHz spectrum to support schools and educational programming in 1963. Meanwhile, ARPANET, the precursor to the modern Internet, was just in its embryonic stages. We had no idea what it would someday become or how our world would soon change in dramatic ways. But what we knew then, and what hasn’t changed since, is that we have a duty to ensure that our communications networks serve our students and our schools. As President Kennedy said, our national survival depends on it.
Today’s Report and Order is a missed opportunity. There’s no question that the EBS program has its flaws and that it doesn’t look quite the way it was envisioned all those years ago. But rather than embracing the positive aspects of the program and improving upon it, we instead set up a regulatory framework that may lead to its ultimate demise. This is a regrettable outcome, and one that could have been avoided.
Like television in the 1960s, the internet today has the potential to teach more things to more people than ever before. Similarly, the EBS program has grown from a program for closed-circuit educational television to a nationwide broadband program for schools and other educational institutions. EBS licensees use 2.5 GHz spectrum to teach online classes and provide hotspots to students. They’re using it to keep students connected while they’re in the hospital or when extreme weather events keep them from attending class. They’re using it to build out their own networks, such as Northern Michigan University’s WiMAX network, which provides broadband access to rural students in the Upper Peninsula. It’s not what we imagined in 1963, but only because before the internet these kinds of programs couldn’t be imagined.
Critics of the EBS program suggest that the educational institution licensees should receive little sympathy for today’s decision. These critics point out that, despite several innovative programs, EBS spectrum remains unused in large parts of the country and is usually leased by licensees to commercial entities. But while these facts are indisputable, they don’t tell the whole story. What they fail to account for is the Commission’s role in the lack of EBS licenses in much of the country. As the item grudgingly acknowledges, the Commission suspended the processing of applications for new EBS licenses in 1993. Back then, the Commission claimed that this suspension would be “for a short period of time” and that the agency would “resume accepting applications expeditiously.”390 The Commission instituted this freeze, not because it believed the spectrum could be put to better use, but to allow it to determine an equitable way to award licenses because the demand for the program was so great. With the exception of
390 See Amendment of Part 74 of the Commission’s Rules with Regard to the Instructional Television Fixed Service, Notice of Proposed Rulemaking, 8 FCC Rcd 1275, 1277 para. 9 (1993).
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Page 185 of 188 Federal Communications Commission FCC 19-62 a brief window in 1995, however, it has been about a quarter-century since educational institutions could obtain new EBS licenses. And while the Commission has periodically discussed the EBS program, the agency’s failure to resume issuance of EBS licenses has created a cloud over the program that is no fault of the licensees.
EBS critics also make a great deal of the fact that most EBS licensees lease their spectrum. But those critics fail to acknowledge that it was the Reagan-era FCC that encouraged licensees to lease their spectrum. Back in 1983, the Commission realized that most EBS licensees – educational institutions with little technical expertise or access to capital – lacked the resources to build out their own facilities, and that they needed additional resources for the service to grow. To quote the agency, “when the amount of money available to public schools is being reduced by taxpayers, expenses for educational technologies … are usually among the first to be reduced or eliminated.”391 The Commission therefore approved the leasing of this spectrum to allow licensees to generate revenue that “would widen [the program’s] base of support and contribute to the service’s ability to withstand a diminution in any one source of funding without being forced to significantly reduce its overall service to the community.”392
Indeed, even after the FCC authorized the spectrum for use in wireless broadband, the agency continued to point to the value of lease arrangements in putting the spectrum to use. As the agency stated in its 2004 order: “it is well established that revenue from leasing to commercial interests has, in many instances, effectively funded and financed … buildout and operations. The Commission has always considered the leasing of excess capacity a legitimate source of funding for the educational mission, and has taken numerous steps over the years to facilitate and encourage these secondary market transactions.”393
So it was with the Commission’s blessing that most EBS licensees entered into lease arrangements with commercial providers. Nevertheless, a few EBS licensees have built out their own networks and done an outstanding job providing services to their communities. And although most have not built their own networks, many have obtained lease terms that provide benefits for their institutions and communities like those cited earlier.
Thus, the EBS program today may not be what the Commission intended when it first established the program, but it does reflect the broad intent of the agency when it last considered its merits. To quote then-Commissioner Kevin Martin, “Encouraging and supporting education is a crucial value to our society, and that value is reflected in the reservation of spectrum for educational users. While some argue that educational spectrum is currently not being used efficiently, we must remember that this spectrum
391 See Amendment of Parts 2, 21, 74 and 94 of the Commission’s Rules and Regulations, 94 F.C.C. 2d 1203, 1218 para. 36 (1983). 392 Id. at 1250 para. 117. 393 See Amendment of Parts 1, 21, 73, 74 and 101 of the Commission’s Rules to Facilitate the Provision of Fixed and Mobile Broadband Access, Educational and Other Advanced Services in the 2150-2162 and 2500-2690 MHz Bands, Report and Order and Further Notice of Proposed Rulemaking, 19 FCC Rcd 14165, 14225, para. 157 (2004) (BRS/EBS R&O or BRS/EBS FNPRM). See also id. at 14226 para. 53 (“our … leasing and secondary market rules for spectrum leasing arrangements are sufficiently flexible to allow market forces to push the … spectrum towards its highest valued use, and educators will continue to enjoy considerable flexibility to lease their excess capacity spectrum. Further, educators can enter into partnerships with commercial interests to improve the capacity and efficiency of their systems, which in turn could free up more spectrum for commercial operators to work towards the development of ubiquitous broadband.”).
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Page 186 of 188 Federal Communications Commission FCC 19-62 has been under the cloud of major proposed changes for a number of years.”394 Given the Commission’s failure to address the long-standing freeze on new EBS licenses, it’s hard to argue that the cloud was ever fully lifted.
Rather than acknowledging this point, however, the current item dismisses it as ancient history and pushes instead for an approach that will not only result in most of the unassigned spectrum going to commercial providers but also establishes a “one-way ratchet” system by which existing licenses are likely to end up with those same providers.
The Report and Order justifies its approach as necessary to establishing American leadership in 5G and providing service to underserved areas. But this item falls far short of these lofty goals. The order appears likely to result in a windfall of spectrum for current lessors that already control much of the 2.5 GHz spectrum. First, while the item has been revised, the spectrum blocks continue to be sized in a manner that will make it difficult for parties – like educational institutions -- to compete at auction. Moreover, even among such parties, current lessors have a huge advantage because of their superior knowledge of the existing leases, which could significantly affect the valuation of any new overlay licenses. Given the advantage held by current lessors with existing substantial spectrum resources in the 2.5 GHz band, I have doubts that these companies will use any new spectrum for services they weren’t already planning to offer, particularly in rural areas.
As for existing licenses, the item dismisses the EBS community’s concerns about the impact of removing the educational use requirement and allowing non-educational entities to obtain them. The item says that the licensees will retain their licenses and can always reject any unreasonable offers from would- be lessees. But the item ignores the asymmetrical bargaining power of the parties here. For example, as the Commission acknowledged in its 1983 order, educational institutions have limited resources and technological budgets are often the first to be cut. Suggesting that a local school district and a multi- billion-dollar corporation have equal bargaining power, particularly if existing leases restrict a school district’s alternatives through first right of refusal clauses, is simply not credible. Moreover, even those licensees who can theoretically turn down a would-be lessee have limited alternatives. Unfortunately, the situation has not changed much since the 1980s -- most school districts lack access to the resources needed to build out their own networks. And given the existence of long-standing lease arrangements, it’s unlikely that an alternative provider will be willing to pick up an existing lease and build out its own network. In effect, current commercial lessees can simply tell an EBS licensee to “take it or leave it.”
Instead of sunsetting the EBS program, the Commission could have improved it, as the President’s Department of Education recently urged.395 For example, we could have: attached conditions to new licensees for the provision of uncapped low-cost service to educational institutions or students; created a Priority Filing Window for educational institutions in rural areas to obtain new licenses where competing applications are unlikely; or broken the spectrum blocks into small enough segments that smaller carriers or educational institutions could have had a shot at getting some of this spectrum.
These changes could have encouraged development of 5G and rural services while remaining true
394 Id., Separate Statement of Commissioner Kevin J. Martin. 395 Letter from Jim Blew, Assistant Secretary for Planning, Evaluation and Policy Development, U.S. Department of Education, to Marlene Dortch, Secretary, Federal Communications Commission, WT Docket 18-120, dated June 7, 2019 at 4-5.
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Page 187 of 188 Federal Communications Commission FCC 19-62 to President Kennedy’s call to action all those years ago. Instead, we have a lost opportunity and a program that has been fundamentally undermined.
For now, the EBS program remains in place and I wish the licensees the best. They do incredible work, and they have my support. But this item leaves me with grave concerns about the future of this program.
Finally, while I disagree with much of the approach taken in this item, I support the item’s adoption of a Priority Filing Window for Tribes. I think this is a tremendously beneficial result and should lead to increased broadband availability for this community. I look forward to hearing how these licenses will help address this critical need.
Thanks to WTB for their work on this item.
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