Once the reverse and forward auctions are complete and the repacking process finalized, the FCC will reauthorize and relicense the facilities of the remaining broadcast television stations that receive new channel assignments in the repacking, or because they have won their auction bid to move to a lower frequency band or to channel share.
Transitioning Broadcasters After the Auctions
Once the reverse and forward auctions are complete and the repacking process is finalized, the FCC will reauthorize and relicense the facilities of the remaining broadcast television stations that receive new channel assignments in the repacking, or because they have won their auction bid to move to a different frequency band or to channel share. The results of the repacking process will be announced by public notice and will include any new channel assignments for television stations.
Reassigned stations will have three months to file construction permit applications for any minor changes to their facilities necessary to operate on their new channels. After all stations have filed their initial applications, stations will be permitted to request alternate channels or expanded facilities on their new channels. Following the three-month application filing deadline, stations will have up to 36 months to transition to their new channels. Licensees that successfully bid to relinquish their licenses or to share a channel will have three months from their receipt of auction proceeds to cease operations on their pre-auction channels.
The Commission will assign stations construction deadlines within the 36 month transition period based on the unique circumstances of each station’s move. For example, we will consider the technical challenges involved in a station’s transition recognizing that the process may be relatively simple for some stations (i.e., retuning existing equipment), and more complicated for others (i.e., replacing equipment and retrofitting or replacing a tower). Among other factors, we will also look at whether the modification needs to be coordinated with other stations. Stations may request extensions of time to construct their new facilities, but no station will be allowed to continue operating on their pre-auction channel more than 39 months after the repacking process becomes effective.
Reimbursement of Relocation Costs
The Spectrum Act requires that the FCC “reimburse costs reasonably incurred by” broadcast television licensees that are reassigned to new channels, as well as by multichannel video programming distributors (“MVPDs”) that incur costs in order to carry the signals of reassigned licensees.
The Spectrum Act provides $1.75 billion to be expended for reimbursements. It also mandates that the FCC make all reimbursement payments within three years of the completion of the auction. Therefore, the FCC places great importance on conducting a fast and efficient reimbursement process. Of the broadcast stations that may be reassigned in the auction and repacking processes, only full power and Class A licensees that are involuntarily assigned to new channels in the repacking process are eligible for reimbursement. Winning auction bidders that remain on the air and incur relocation costs because of their chosen bid option (i.e. stations that move from UHF to VHF or “sharee” stations that move in order to share a channel with another licensee) will be expected to cover their own relocation costs. Broadcasters assigned new channels in the repacking process that apply for and receive a flexible use waiver of the FCC's service rules will also forgo reimbursement for their relocation costs.
The FCC will reimburse broadcasters and MVPDs by providing initial allocations of funds based on their estimated costs followed by a subsequent allocation, to the extent necessary, prior to the end of the three-year reimbursement period. All entities seeking reimbursement will be required to provide an estimate of their eligible channel relocation costs after the auction. Subject to timing constraints, the Media Bureau intends to issue NCE broadcasters initial allocations equivalent to up to 90% of their estimated costs eligible for reimbursement, and all other eligible broadcasters and MVPDs initial allocations equivalent to up to 80% of their estimated costs eligible for reimbursement. Prior to the end of the three-year reimbursement period, the Media Bureau will issue a final allocation, if appropriate, based on broadcasters’ and MVPDs’ actual documented costs.
Finally, in order to provide transparency, the FCC will make disbursement amounts publicly available. The Commission will also validate data and conduct audits and site visits in order to guard against waste, fraud, and abuse of these public funds.