SMART Act

II 116TH CONGRESS 2D SESSION S. 3246 To amend the Communications Act of 1934 to direct the Federal Communica- tions Commission to conduct a public auction of the C-band, and for other purposes. IN THE SENATE OF THE UNITED STATES JANUARY 28, 2020 Mr. KENNEDY (for himself, Mr. SCHATZ, and Ms. CANTWELL) introduced the following bill; which was read twice and referred to the Committee on Commerce, Science, and Transportation A BILL To amend the Communications Act of 1934 to direct the Federal Communications Commission to conduct a public auction of the C-band, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Spectrum Management 4 And Reallocation for Taxpayers Act’’ or the ‘‘SMART 5 Act’’. 6 SEC. 2. DEFINITIONS. 7 In this Act: 8 VerDate Sep 11 2014 00:01 Jan 29, 2020 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S3246.IS S3246 pamtmann on DSKBC07HB2PROD with BILLS 2 •S 3246 IS (1) C-BAND REIMBURSEMENT AND IMPLEMEN- 1 TATION FUND; C-BAND FUND.—The term ‘‘C-Band 2 Reimbursement and Implementation Fund’’ or ‘‘C- 3 Band Fund’’ means the fund established under sec- 4 tion 5(a). 5 (2) COMMISSION.—The term ‘‘Commission’’ 6 means the Federal Communications Commission. 7 (3) DIGITAL DIVIDE TRUST FUND.—The term 8 ‘‘Digital Divide Trust Fund’’ means the trust fund 9 established under section 4(a)(1)(A). 10 (4) NATIVE AMERICANS.—The term ‘‘Native 11 Americans’’ has the meaning given the term in sec- 12 tion 736(g) of the Public Health Service Act (42 13 U.S.C. 293(g)). 14 (5) NEXT GENERATION 9–1–1 TRUST FUND.— 15 The term ‘‘Next Generation 9–1–1 Trust Fund’’ 16 means the trust fund established under section 17 4(a)(1)(B). 18 (6) TRUST LAND.—The term ‘‘trust land’’ has 19 the meaning given the term in section 3765 of title 20 38, United States Code. 21 SEC. 3. PUBLIC AUCTION OF C-BAND SPECTRUM. 22 (a) IN GENERAL.—Not later than 1 year after 23 issuing rules for reallocating a portion of the electro- 24 magnetic spectrum described in subsection (b) through a 25 VerDate Sep 11 2014 00:01 Jan 29, 2020 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S3246.IS S3246 pamtmann on DSKBC07HB2PROD with BILLS 3 •S 3246 IS public auction, if the Commission issues such rules during 1 the year 2020, the Commission shall— 2 (1) identify 300 megahertz of that spectrum for 3 reallocation consistent with this section; 4 (2) clear the spectrum identified under para- 5 graph (1) consistent with subsection (d); 6 (3) reallocate the spectrum identified under 7 paragraph (1) for terrestrial broadband use, reserv- 8 ing 20 megahertz of the spectrum as a guard band; 9 and 10 (4) notwithstanding paragraph (15)(A) of sec- 11 tion 309(j) of the Communications Act of 1934 (47 12 U.S.C. 309(j)), commence a system of competitive 13 bidding under that section to grant new initial li- 14 censes for the use of the spectrum identified under 15 paragraph (1) of this subsection, subject to— 16 (A) flexible-use service rules; and 17 (B) the requirement to protect incumbent 18 uses of the spectrum not otherwise cleared 19 under paragraph (2) of this subsection from 20 harmful interference. 21 (b) ELECTROMAGNETIC SPECTRUM DESCRIBED.— 22 The electromagnetic spectrum described in this subsection 23 is the spectrum between 3700 megahertz and 4200 mega- 24 hertz, inclusive. 25 VerDate Sep 11 2014 00:01 Jan 29, 2020 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S3246.IS S3246 pamtmann on DSKBC07HB2PROD with BILLS 4 •S 3246 IS (c) AUCTION PROCEEDS.—Section 309(j)(8) of the 1 Communications Act of 1934 (47 U.S.C. 309(j)(8)) is 2 amended— 3 (1) in subparagraph (A), by striking ‘‘and (G)’’ 4 and inserting ‘‘(G), and (H)’’; 5 (2) in subparagraph (C)(i), by striking ‘‘and 6 (G)’’ and inserting ‘‘(G), and (H)’’; and 7 (3) by adding at the end the following: 8 ‘‘(H) CERTAIN PROCEEDS DESIGNATED 9 FOR C-BAND REALLOCATION, BROADBAND IN- 10 FRASTRUCTURE DEPLOYMENT, AND NEXT GEN- 11 ERATION 9–1–1 SERVICES.—Notwithstanding 12 subparagraph (A) and except as provided in 13 subparagraph (B), of the proceeds (including 14 deposits and upfront payments from successful 15 bidders) from the use of a system of competitive 16 bidding under this subsection pursuant to sec- 17 tion 3 of the Spectrum Management And Re- 18 allocation for Taxpayers Act— 19 ‘‘(i) the Commission shall use such 20 amounts as are necessary to reimburse the 21 general fund of the Treasury for any 22 amounts borrowed under section 5(b) of 23 that Act; 24 VerDate Sep 11 2014 00:01 Jan 29, 2020 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S3246.IS S3246 pamtmann on DSKBC07HB2PROD with BILLS 5 •S 3246 IS ‘‘(ii) after compliance with clause (i) 1 of this subparagraph, the Commission shall 2 deposit the next $5,000,000,000 in the 3 general fund of the Treasury for the sole 4 purpose of deficit reduction; and 5 ‘‘(iii) after compliance with clauses (i) 6 and (ii) of this subparagraph, the Commis- 7 sion shall deposit all amounts remaining in 8 accordance with section 4(b) of that Act.’’. 9 (d) CLEARING OF C-BAND SPECTRUM FOR AUC- 10 TION.— 11 (1) LICENSES.— 12 (A) ISSUANCE.—The Commission shall 13 issue any new licenses or license modifications 14 required to clear electromagnetic spectrum 15 under subsection (a)(2) as expeditiously as pos- 16 sible after the date of enactment of this Act. 17 (B) PROTESTS.—The right of a licensee to 18 protest a proposed order of modification of its 19 license under section 316 of the Communica- 20 tions Act of 1934 (47 U.S.C. 316) shall not 21 apply in the case of a modification made under 22 subparagraph (A) of this paragraph. 23 (2) PROTECTION OF C-BAND USERS.—The 24 Commission shall clear electromagnetic spectrum 25 VerDate Sep 11 2014 00:01 Jan 29, 2020 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S3246.IS S3246 pamtmann on DSKBC07HB2PROD with BILLS 6 •S 3246 IS under subsection (a)(2) in a manner that ensures 1 that persons or entities that used the spectrum be- 2 fore the clearing of the spectrum receive— 3 (A) service that is equivalent to or better 4 than the service received before the clearing of 5 the spectrum; and 6 (B) service at a level described in subpara- 7 graph (A) continuously throughout the clearing 8 of the spectrum. 9 (e) ADDITIONAL PROTECTIONS.—In promulgating 10 rules regarding the use of spectrum in the covered band, 11 the Commission shall ensure that aviation safety and other 12 safety-of-life uses operating in the covered band or in adja- 13 cent spectrum bands are protected from harmful inter- 14 ference. 15 SEC. 4. TRUST FUNDS. 16 (a) ESTABLISHMENT.— 17 (1) IN GENERAL.—There is established in the 18 Treasury of the United States— 19 (A) a trust fund to be known as the ‘‘Dig- 20 ital Divide Trust Fund’’; and 21 (B) a trust fund to be known as the ‘‘Next 22 Generation 9–1–1 Trust Fund’’. 23 VerDate Sep 11 2014 00:01 Jan 29, 2020 Jkt 099200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S3246.IS S3246 pamtmann on DSKBC07HB2PROD with BILLS 7 •S 3246 IS (2) AVAILABILITY.—Amounts deposited in the 1 trust funds established under paragraph (1) shall re- 2 main available until expended. 3 (b) DEPOSIT OF FUNDS.—With respect to the 4 amounts described in subparagraph (H)(i)(II) of section 5 309(j)(8) of the Communications Act of 1934 (47 U.S.C. 6 309(j)(8)), as added by section 3 of this Act, the Commis- 7 sion shall deposit— 8 (1) one-third of those amounts, but not to ex- 9 ceed $12,500,000,000, in the Next Generation 9–1– 10 1 Trust Fund; and 11 (2) any remaining amounts in the Digital Di- 12 vide Trust Fund. 13 (c) USE OF DIGITAL DIVIDE TRUST FUND.— 14 (1) IN GENERAL.—The Commission shall use 15 the amounts deposited in the Digital Divide Trust 16 Fund for the deployment of— 17 (A) wireless broadband infrastructure in 18 areas that the Commission has determined are 19 underserved or unserved with respect to wire- 20 less broadband internet access service, including 21 areas located on trust land or used to deliver 22 services to Native Americans; 23 (B) wired broadband infrastructure in 24 areas that the Commission has determined are 25 VerDate Sep 11 2014 00:01 Jan 29, 2020 Jkt 099200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S3246.IS S3246 pamtmann on DSKBC07HB2PROD with BILLS 8 •S 3246 IS underserved or unserved with respect to wired 1 broadband internet access service, including 2 areas located on trust land or used to deliver 3 services to Native Americans; and 4 (C) broadband infrastructure to support 5 other technologies, including telehealth, tele- 6 medicine, e-government, and educational oppor- 7 tunities at home. 8 (2) LIMITATIONS.— 9 (A) RULEMAKING REQUIRED.— 10 (i) TIMING.—Not earlier than Janu- 11 ary 1, 2023, the Commission shall conduct 12 a rulemaking to determine how to imple- 13 ment paragraph (1). 14 (ii) OBLIGATION OF AMOUNTS.—The 15 Commission may not obligate any amounts 16 from the Digital Divide Trust Fund under 17 paragraph (1) until the Commission has 18 completed the rulemaking under clause (i) 19 of this subparagraph. 20 (B) RELATION TO UNIVERSAL SERVICE 21 PROGRAMS.—The amounts provided under 22 paragraph (1) are not intended to supplant, or 23 be commingled with, the funds collected by the 24 Commission and distributed through any pro- 25 VerDate Sep 11 2014 00:01 Jan 29, 2020 Jkt 099200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S3246.IS S3246 pamtmann on DSKBC07HB2PROD with BILLS 9 •S 3246 IS gram established under section 254 of the Com- 1 munications Act of 1934 (47 U.S.C. 254). 2 (d) USE OF NEXT GENERATION 9–1–1 TRUST 3 FUND.—The National 911 Program overseen by the Na- 4 tional Telecommunications and Information Administra- 5 tion and the National Highway Traffic Safety Administra- 6 tion shall use the amounts deposited in the Next Genera- 7 tion 9–1–1 Trust Fund for the deployment of Next Gen- 8 eration 9–1–1 services. 9 SEC. 5. C-BAND REIMBURSEMENT AND IMPLEMENTATION 10 FUND. 11 (a) ESTABLISHMENT.—There is established in the 12 Treasury of the United States a fund to be known as the 13 ‘‘C-Band Reimbursement and Implementation Fund’’ (re- 14 ferred to in this section as the ‘‘C-Band Fund’’). 15 (b) BORROWING AUTHORITY.—The Commission may 16 borrow from the Treasury of the United States an amount 17 not to exceed $6,000,000,000 to use for payments re- 18 quired under subsections (d) and (e). 19 (c) DEPOSIT OF FUNDS.—Any amounts borrowed 20 under subsection (b) shall be deposited in the C-Band 21 Fund. 22 (d) PAYMENT OF COSTS.—The Commission shall use 23 the amounts in the C-Band Fund to reimburse costs rea- 24 sonably incurred by— 25 VerDate Sep 11 2014 00:01 Jan 29, 2020 Jkt 099200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\S3246.IS S3246 pamtmann on DSKBC07HB2PROD with BILLS 10 •S 3246 IS (1) incumbent holders of licenses or market ac- 1 cess rights for use of the electromagnetic spectrum 2 identified under paragraph (1) of section 3(a), to re- 3 duce the usage of that spectrum by those entities in 4 accordance with that section; 5 (2) licensees or registrants of an earth station 6 receiving signals over the spectrum identified under 7 section 3(a)(1); and 8 (3) the relocation of other incumbent uses of 9 the spectrum identified under section 3(a)(1). 10 (e) IMPLEMENTATION.—The Commission shall use 11 not more than $1,000,000,000 of the amounts in the C- 12 Band Fund for payments to incentivize incumbent holders 13 of licenses or market access rights for use of the electro- 14 magnetic spectrum identified under paragraph (1) of sec- 15 tion 3(a) to reduce their usage of that spectrum in accord- 16 ance with that section in a more timely fashion. 17 (f) TRANSFER OF UNUSED FUNDS.—If any amounts 18 remain in the C-Band Fund after the date that is 3 years 19 after the completion of the system of competitive bidding 20 conducted under section 3, the Secretary of the Treasury 21 shall transfer those amounts to the Digital Divide Trust 22 Fund. 23 VerDate Sep 11 2014 00:01 Jan 29, 2020 Jkt 099200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\S3246.IS S3246 pamtmann on DSKBC07HB2PROD with BILLS 11 •S 3246 IS SEC. 6. SPECTRUM AUCTION PARTICIPATION. 1 (a) IN GENERAL.—Section 309(j) of the Communica- 2 tions Act of 1934 (47 U.S.C. 309(j)) is amended— 3 (1) in paragraph (17)(A), in the matter pre- 4 ceding clause (i), by striking ‘‘Notwithstanding’’ and 5 inserting ‘‘Subject to paragraph (19) and notwith- 6 standing’’; and 7 (2) by adding at the end the following: 8 ‘‘(19) PROHIBITION ON AUCTION PARTICIPA- 9 TION BY ENTITIES POSING A NATIONAL SECURITY 10 RISK.— 11 ‘‘(A) IN GENERAL.—An entity posing a na- 12 tional security risk may not participate in any 13 system of competitive bidding under this sub- 14 section. 15 ‘‘(B) DEFINITION.— 16 ‘‘(i) IN GENERAL.—For purposes of 17 this paragraph, the term ‘entity posing a 18 national security risk’ means an entity that 19 the Commission determines poses a na- 20 tional security risk. 21 ‘‘(ii) DETERMINATION.—In deter- 22 mining which entities qualify as entities 23 posing a national security risk under this 24 paragraph, the Commission shall rely sole- 25 ly upon a determination by— 26 VerDate Sep 11 2014 00:01 Jan 29, 2020 Jkt 099200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\S3246.IS S3246 pamtmann on DSKBC07HB2PROD with BILLS 12 •S 3246 IS ‘‘(I) an appropriate national se- 1 curity agency; 2 ‘‘(II) an interagency body that 3 includes appropriate national security 4 expertise, including the Federal Ac- 5 quisition Security Council established 6 under section 1322 of title 41, United 7 States Code; 8 ‘‘(III) Congress; or 9 ‘‘(IV) the Secretary of Commerce 10 under the program established under 11 Executive Order 13873 (84 Fed. Reg. 12 22689; relating to securing informa- 13 tion and communications technology 14 and services supply chain) or by an 15 agency under any successor pro- 16 gram.’’. 17 (b) IMPLEMENTATION.—Not later than 1 year after 18 the date of enactment of this Act, the Commission shall 19 take all steps necessary to implement the amendments 20 made by subsection (a). 21 Æ VerDate Sep 11 2014 00:01 Jan 29, 2020 Jkt 099200 PO 00000 Frm 00012 Fmt 6652 Sfmt 6301 E:\BILLS\S3246.IS S3246 pamtmann on DSKBC07HB2PROD with BILLS