The Commerce Department's National Telecommunications and Information Administration (NTIA) today announced rules formalizing reimbursement procedures for new licensees to compensate federal agencies that relocate their operations to make frequency spectrum available for commercial use. Publication in the Federal Register (available on the NTIA Web site at http://www.ntia.doc.gov/ntiahome/frnotices/2002/reimbursefinal6132002.htm) concludes a rulemaking process that began January 17, 2001 and was mandated by the Strom Thurmond National Defense Authorization Act for Fiscal Year 1999. That act required private entities that obtain licenses to use spectrum, which had been used by the military and other federal users, to compensate the incumbent agencies.

The rules would apply to spectrum in the following bands, which have been reallocated from government to commercial use and will be licensed through future Federal Communications Commission (FCC) auctions: 216 to 220 MHz; 1432 to 1435 MHz; 2385 to 2390 MHz; 1710 to 1755 MHz.

Under the rules announced today, federal agencies would prepare an estimate of their relocation costs, and that amount would be provided to potential bidders at future auctions. The new licensees would be bound to pay the actual reimbursement costs, including the costs of planning, equipment, construction, engineering and other costs. Reimbursement costs would be paid in addition to the amount bid at auction. Payment arrangements would be negotiated directly between the federal agency and the new licensee.