How Government Error Affected Some TV and Radio Broadcasters

Last spring, the Federal Communications Commission (FCC) recast radio-frequency spectrum for modern technology.

Sadly, however, a bureaucratic flub tempers the gains from this move.

The FCC held its first-ever “incentive auction,” in which some companies with radio-frequency spectrum rights sold those rights to the commission, which then auctioned them to new buyers. Most of the auction entailed spectrum reallocation toward mobile and internet service. The auction reportedly generated $7 billion in revenue.

The result was a “repacked” radio-frequency spectrum allocated by market demand. But in the process, some radio and television broadcasters were repacked into this new spectrum, imposing extraneous costs on their operations. Funds raised during the auction could have alleviated these costs, but the money was instead sent to the U.S. Department of the Treasury for “deficit reduction.”

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And that’s precisely the problem. An auction that produced great results generated unexpected consequences for some television and radio broadcasters. Given that radio-frequency spectrum is a scarce, state-controlled resource, government should remedy problems it causes while managing this asset.

Before auction proceeds fund federal deficits, the FCC should pay for costs imposed on broadcasters incidentally through repacking. Television broadcasters will now need to relocate stations or install transmitters that comply with new spectrum allocations. Congress authorized the Television Broadcaster Relocation Fund, which provides $1.75 billion for repacking — but this falls short of the projected $2.1 billion cost.

Radio broadcasters also face bleak challenges, such as the possibility of “going dark” during repacking installations. Many radio broadcasters share towers and site locations with television stations. To repack television stations, workers must climb towers and perform their duties. Any radio station on a site undergoing repacking will need to temporarily turn off to guarantee a safe working environment.

Estimates conclude that 678 FM radio stations could end up “going dark” due to repacking.

Unlike with television, there’s no relocation fund for radio broadcasters. This is seemingly a bureaucratic error, in which Congress didn’t realize radio would potentially be impacted so seriously by the auction. Popular radio stations and emergency services could be permanently harmed without aid. Locals could lose their favorite channels for their everyday commutes.

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Two bipartisan bills in Congress would fix this gaping error if passed. The Viewer and Listener Protection Act of 2017, sponsored by Sen. Jerry Moran (R-Kan.), would allocate auction funds toward repacking compliance in both radio and television broadcasting. The Radio Consumer Protection Act, sponsored by Reps. Bill Flores (R-Texas) and Gene Green (D-Texas), also provides funds to radio stations affected by repacking.

Authorizing full use of incentive auction proceeds for repacking damages would alleviate externalities imposed on television and radio broadcasters.

Remaining funds can return to the Treasury only after government accounts for its own actions.

Andrew Magloughlin is deeply involved in the conservative and libertarian movements. He has think tank and political campaign experience and previously led the Young Americans for Liberty chapter at American University in Washington, D.C.

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