IATF Allocates $1 Billion of Repacking Reimbursement Funds; Bipartisan Legislators Urge On-Time Repack

The allocation is based on verified cost estimates from broadcasters and MVPDs, and after that verification process and some adjustment of broadcaster repacking plans, the projected cost of the repacking is now estimated at $1.86 billion, down from a previous estimate of $2.12 billion, the IATF said. That number will continue to change during the repacking, the IATF conceded, and one broadcast attorney told us he believes it likely will go back up. “Those costs are still out there,” the attorney said. “We emphasize that the verified estimates used for purposes of this initial allocation are likely to rise,” the IATF said. As broadcasters and MVPDs “are able to produce adequate justification for their unverified initial estimates,” the realities of actual construction and tower work bring more costs, and equipment costs rise over the course of the repacking, the estimate is likely to go back up, the IATF said. “Based on our initial review of reimbursement estimates, commercial broadcast stations require approximately $1.6136 billion, NCEs [noncommercial educationals] require approximately $294.9 million, and MVPDs require approximately $17.9 million,” the PN said.

House Republican Conference Chairman Cathy McMorris Rodgers, R-Wash., and Rep. Anna Eshoo, D-Calif., ultimately got 54 other House members to sign their letter urging the FCC not to allow any exemptions to the 39-month repacking timeline. Broadcasters asked Congress to give the FCC more leeway to grant exemptions to broadcasters who can’t meet the timeline because of circumstances outside their control (see 1709070058). Eshoo, McMorris Rodgers and the other lawmakers said they're “concerned that delays to the 39-month repacking timeline established by the FCC will impede the billions of dollars of private sector investments in infrastructure necessary” to increase deployment of broadband in rural areas.

The letter is controversial for favoring a position mainly voiced by T-Mobile, which favored strict adherence to the 39-month timeline, but probably doesn’t affect the trajectory of legislation aimed at allocating funds to supplement the existing Broadcaster Relocation Fund, several industry lobbyists said. “Even some of the wireless advocates who were pushing people to sign the letter were telling members ‘sign the letter but also sign up’” to support the Viewer Protection Act (HR-3347), the main House vehicle for additional repack funding, a communications sector lobbyist said.

Top House Commerce Committee Democrats are seeking to attach the funding language from HR-3347 as an amendment to the draft FCC Reauthorization Act, which the House Communications Subcommittee cleared last week (see 1710110070). Telecom-focused House Commerce Democrats and Republicans appear to “have a lot of agreement on the basic intentions” of adding additional repacking funding into a final FCC reauthorization bill before a full committee markup, “but the details still matter,” a Democratic House aide told us.

The IATF plans to release more of the reimbursement money depending on the rate the first billion is drawn down, the PN said. The agency anticipates making a second allocation “in the near future,” likely before the Phase One testing deadline in September. Multiple stages of reimbursement allocation will allow the agency “to make timely allocations to keep the process moving forward, while reducing the likelihood that excess funds are allocated that would require the Commission to reduce future allocations or claw-back payments that have already been drawn down,” the PN said. “It is therefore especially important that entities seeking reimbursement timely submit invoices after incurring cost,” the PN said.

NAB, Ion and public TV groups asked the FCC to release a larger portion of the funds upfront. Though the IATF was authorized to release up to 80 percent of reimbursable expenses upfront for commercial stations and 90 percent for noncommercial, the PN releases 52 percent and 62 percent, respectively. If upfront costs exceed the initial allocation, stations may not be able to pay for repacking efforts, and stations can’t be sure bills won’t come due before additional allocations are parceled out, said PBS, CPB and America’s Public Television Stations in meetings with the IATF and Media Bureau last week. That would put stations “in an untenable position” the groups said in ex parte filings.

APTS “recognizes the difficult position the FCC is in given the insufficiency of the repacking reimbursement fund, and we are hopeful that Congress will appropriate more funding quickly,” said an APTS spokeswoman: “We are confident that the FCC will recognize the need to get the remaining amount of funding due to our Phase 1 public television stations as quickly as possible.” NAB is “pleased the FCC is releasing money so stations can have reasonable repacking costs covered,” an association spokesman said. “We believe, however, the repack would be accomplished more efficiently if the Commission would release more of the $1.75 billion so stations can reasonably afford moves they are being required to make.”

Release of the PN means broadcasters and MVPDs are now able to see their individual allocations and begin submitting invoices, the IATF said. That's expected to lead to a spate of orders at equipment manufacturers, said Dielectric Antenna Sales Executive Christine Zuba. Though Dielectric has received hundreds of orders and requests for estimates, many broadcasters have been holding off spending money until they know the amount they’d be allocated up front, she said. Releasing the money is expected to remove a barrier to broadcasters meeting their expected repacking timelines, a broadcast attorney said.