Auction of FM Broadband Radio Service (BRS) Licenses Scheduled for October 27, 2009; Comment Sought on Competitive Bidding Procedures for Auction 86, 22166-22170 [E9-11076]

Download as PDF 22166 Federal Register / Vol. 74, No. 90 / Tuesday, May 12, 2009 / Notices rwilkins on PROD1PC63 with NOTICES comments to the EPA Administrator and testimony to the U.S. Congress on the adequacy of the EPA’s research budget. The purpose of this teleconference will be to allow the SAB to discuss with Agency representatives the research priorities that are covered by the Fiscal Year 2010 research budget. Previous SAB budget advisories are on the SAB Web site at https://www.epa.gov/sab. Availability of Meeting Materials: The agenda and other materials in support of this teleconference will be placed on the SAB Web site at https://www.epa.gov/sab in advance of this teleconference. Procedures for Providing Public Input: Interested members of the public may submit relevant written or oral information for the SAB to consider on the topics included in this advisory activity. Oral Statements: In general, individuals or groups requesting an oral presentation at a public teleconference will be limited to three minutes per speaker, with no more than a total of one-half hour for all speakers. Interested parties should contact Mr. Miller, DFO, in writing (preferably via e-mail) at the contact information noted above, by May 21, 2009 to be placed on a list of public speakers for the teleconference. Written Statements: Written statements should be received in the SAB Staff Office by May 21, 2009 so that the information may be made available to the SAB Panel members for their consideration and placed on the SAB Web site for public information. Written statements should be supplied to the DFO in the following formats: one hard copy with original signature, and one electronic copy via e-mail (acceptable file format: Adobe Acrobat PDF, WordPerfect, MS Word, MS PowerPoint, or Rich Text files in IBM-PC/Windows 98/2000/XP format). Submitters are asked to provide versions of each document submitted with and without signatures, because the SAB Staff Office does not publish documents with signatures on its Web sites. Accessibility: For information on access or services for individuals with disabilities, please contact Mr. Thomas Miller at (202) 343–9982, or miller.tom@epa.gov. To request accommodation of a disability, please contact Mr. Miller, preferably at least 10 days prior to the meeting, to give EPA as much time as possible to process your request. Dated: May 7, 2009. Vanessa T. Vu, Director, EPA Science Advisory Board Staff Office. [FR Doc. E9–11106 Filed 5–11–09; 8:45 am] BILLING CODE 6560–50–P VerDate Nov<24>2008 17:14 May 11, 2009 Jkt 217001 FEDERAL COMMUNICATIONS COMMISSION [AU Docket No. 09–56; DA 09–843] Auction of FM Broadband Radio Service (BRS) Licenses Scheduled for October 27, 2009; Comment Sought on Competitive Bidding Procedures for Auction 86 AGENCY: Federal Communications Commission. ACTION: Notice. SUMMARY: This document announces the auction of unassigned Broadband Radio Service (BRS) licenses scheduled to commence on October 27, 2009 (Auction 86). This document also seeks comments on competitive bidding procedures for Auction 86. DATES: Comments are due on or before May 15, 2009, and reply comments are due on or before May 29, 2009. ADDRESSES: Comments and reply comments must be identified by AU Docket No. 09–56. Comments may be filed electronically using the Internet by accessing the Federal Communications Commission’s Electronic Comment Filing System (ECFS) at https:// www.fcc.gov/cgb/ecfs. Filers should follow the instructions provided on the Web site for submitting comments. The Wireless Telecommunications Bureau requests that a copy of all comments and reply comments be submitted electronically to the following address: auction86@fcc.gov. In addition, comments and reply comments may be submitted by any of the following methods: • Paper Filers: Parties who choose to file by paper must file an original and four copies of each filing. Filings can be sent by hand or messenger delivery, by commercial overnight courier, or by first-class or overnight U.S. Postal Service mail (although the Bureaus continue to experience delays in receiving U.S. Postal Service mail). All filings must be addressed to the Commission’s Secretary, Attn: WTB/ ASAD, Office of the Secretary, Federal Communications Commission. • The Commission’s contractor will receive hand-delivered or messengerdelivered paper filings for the Commission’s Secretary at 236 Massachusetts Avenue, NE., Suite 110, Washington, DC 20002. The filing hours at this location are 8 a.m. to 7 p.m. Eastern Time (ET). All hand deliveries must be held together with rubber bands or fasteners. Commercial overnight mail (other than U.S. Postal Service Express Mail and Priority Mail) must be sent to 9300 East Hampton Drive, Capitol Heights, MD 20743. PO 00000 Frm 00015 Fmt 4703 Sfmt 4703 • U.S. Postal Service first-class, Express, and Priority mail should be addressed to 445 12th Street, SW., Washington, DC 20554. • People With Disabilities: Contact the FCC to request reasonable accommodations (accessible format documents, sign language interpreters, CART, etc.) by e-mail: FCC504@fcc.gov or telephone: 202–418–0530 or TTY: 202–418–0432. FOR FURTHER INFORMATION CONTACT: Wireless Telecommunications Bureau, Auctions and Spectrum Access Division: For auction legal questions: Sayuri Rajapakse at (202) 418–0660. For general auction questions: Jeff Crooks at (202) 418–0660 or Lisa Stover at (717) 338–2868; Broadband Division: For BRS service rule questions: Nancy Zaczek (legal) or Stephen Zak (technical) at (202) 418–2487. SUPPLEMENTARY INFORMATION: This is a summary of the Auction 86 Comment Public Notice released on April 24, 2009. The complete text of the Auction 86 Comment Public Notice, including Attachments A and B, and related Commission documents, are available for public inspection and copying from 8 a.m. to 4:30 p.m. ET Monday through Thursday or from 8 a.m. to 11:30 a.m. ET on Fridays in the FCC Reference Information Center, 445 12th Street, SW., Room CY–A257, Washington, DC 20554. The Auction 86 Comment Public Notice and related Commission documents also may be purchased from the Commission’s duplicating contractor, Best Copy and Printing, Inc. (BCPI), 445 12th Street, SW., Room CY– B402, Washington, DC 20554, telephone 202–488–5300, facsimile 202–488–5563, or you may contact BCPI at its Web site: https://www.BCPIWEB.com. When ordering documents from BCPI, please provide the appropriate FCC document number, for example, DA 09–843. The Auction 86 Comment Public Notice and related documents also are available on the Internet at the Commission’s website: https://wireless.fcc.gov/ auctions/86/, or by using the search function for AU Docket No. 09–56 on the ECFS Web page at https:// www.fcc.gov/cgb/ecfs/. I. Licenses To Be Offered in Auction 86 1. The licenses to be offered in Auction 86 consist of the available spectrum in 78 BRS service areas. BRS service areas are BTAs or additional service areas similar to BTAs adopted by the Commission. Overlay licenses for 75 of the BTAs originally offered in Auction 6 are available now as a result of default, cancellation, or termination. This auction will also include three E:\FR\FM\12MYN1.SGM 12MYN1 rwilkins on PROD1PC63 with NOTICES Federal Register / Vol. 74, No. 90 / Tuesday, May 12, 2009 / Notices additional licenses for BRS service areas in the Gulf of Mexico. A complete list of licenses available for Auction 86 is included as Attachment A of the Auction 86 Comment Public Notice. 2. Where unencumbered, the licenses to be auctioned consist of 76.5 megahertz of spectrum at 2496–2502, 2602–2614, 2614–2615, 2616–2618, and 2618–2673.5 MHz. The Bureau notes that the licenses issued pursuant to this auction will be issued pursuant to the post-transition band plan contained in 47 CFR 27.5(i)(2). A table showing the channelization of this spectrum is included as Attachment B of the Auction 86 Comment Public Notice. 3. Incumbency Issues. There are preexisting BRS incumbent licenses. The service area for each of those site-based licenses is a 35-mile circle centered at the station’s reference coordinates, and is bounded by the chord(s) drawn between the intersection points of the licensee’s previous protected service area and those of respective adjacent market, co-channel licensees. Any licenses granted pursuant to this auction will not include the geographic service areas of any overlapping, co-channel incumbent licenses. If an incumbent license cancels or is forfeited, however, the right to operate within that area shall revert to the overlay licensee that holds the license for the BRS service area that encompasses that BTA. BRS incumbent licenses are entitled to interference protection in accordance with the applicable technical rules. 4. In addition, on the E and F channel groups, grandfathered Educational Broadband Service licenses originally issued on those channels prior to 1983 may continue to operate indefinitely. Such grandfathered EBS licenses must be protected in accordance with the applicable technical rules. 5. Operations within the 2614–2618 MHz band are secondary to adjacent channel operations. 6. Finally, in the 2496–2500 MHz band, BRS licensees must share the band on a co-primary basis with the Code Division Multiple Access Mobile Satellite Service, grandfathered Broadcast Auxiliary Service stations, and grandfathered land mobile and microwave licenses licensed under Parts 90 and 101 of the Commission’s rules, respectively. In addition, the 2400–2500 MHz band is allocated for use by Industrial, Scientific, and Medical equipment under Part 18 of the Commission’s rules. VerDate Nov<24>2008 17:14 May 11, 2009 Jkt 217001 II. Bureau Seeks Comment on Auction Procedures A. Auction Structure i. Simultaneous Multiple-Round Auction Design 7. The Bureau proposed to auction all licenses included in Auction 86 using the Commission’s standard simultaneous multiple-round auction format. This type of auction offers every license for bid at the same time and consists of successive bidding rounds in which eligible bidders may place bids on individual licenses. Typically, bidding remains open on all licenses until bidding stops on every license. The Bureau seeks comment on this proposal. ii. Anonymous Bidding 8. The Bureau proposes to conduct Auction 86 using certain procedures for limited information disclosure or anonymous bidding. Specifically, the Bureau proposes to withhold, until after the close of bidding, public release of (1) Bidders’ license selections on their short-form applications (FCC Form 175), (2) the amounts of bidders’ upfront payments and bidding eligibility, and (3) information that may reveal the identities of bidders placing bids and taking other bidding-related actions. 9. The Bureau seeks comment on the details regarding our proposal for implementation of anonymous bidding in Auction 86, and on alternative proposals for anonymous bidding or other information disclosure procedures. iii. Bidding Rounds 10. Auction 86 will consist of sequential bidding rounds. The initial bidding schedule will be announced in a public notice to be released at least one week before the start of the auction. 11. The Commission will conduct Auction 86 over the Internet, and telephonic bidding will be available as well. The toll-free telephone number for the Auction Bidder Line will be provided to qualified bidders. 12. The Bureau proposes to retain the discretion to change the bidding schedule in order to foster an auction pace that reasonably balances speed with the bidders’ need to study round results and adjust their bidding strategies. Under this proposal, the Bureau may change the amount of time for bidding rounds, the amount of time between rounds, or the number of rounds per day, depending upon bidding activity and other factors. The Bureau seeks comment on this proposal. Commenters may wish to address the PO 00000 Frm 00016 Fmt 4703 Sfmt 4703 22167 role of the bidding schedule in managing the pace of the auction and the tradeoffs in managing auction pace by bidding schedule changes, by changing the activity requirements or bid amount parameters, or by using other means. iv. Stopping Rule 13. For Auction 86, the Bureau proposes to employ a simultaneous stopping rule approach. A simultaneous stopping rule means that all licenses remain available for bidding until bidding closes simultaneously on all licenses. More specifically, bidding will close simultaneously on all licenses after the first round in which no bidder submits any new bids, applies a proactive waiver, or withdraws any provisionally winning bids. Thus, unless the Bureau announces alternative stopping procedures, bidding will remain open on all licenses until bidding stops on every license. Consequently, it is not possible to determine in advance how long the auction will last. 14. Further, the Bureau proposes to retain the discretion to exercise any of the following options during Auction 86: (1) Use a modified version of the simultaneous stopping rule. The modified stopping rule would close the auction for all licenses after the first round in which no bidder applies a waiver, withdraws a provisionally winning bid, or places any new bids on any license for which it is not the provisionally winning bidder. Thus, absent any other bidding activity, a bidder placing a new bid on a license for which it is the provisionally winning bidder would not keep the auction open under this modified stopping rule; (2) declare that the auction will end after a specified number of additional rounds (special stopping rule). If the Bureau invokes this special stopping rule, it will accept bids in the specified final round(s) after which the auction will close; and (3) keep the auction open even if no bidder submits any new bids, applies a waiver, or withdraws any provisionally winning bids. In this event, the effect will be the same as if a bidder had applied a waiver. The activity rule, therefore, will apply as usual and a bidder with insufficient activity will either lose bidding eligibility or use a waiver. 15. The Bureau proposed to exercise these options only in certain circumstances, for example, where the auction is proceeding unusually slowly or quickly, there is minimal overall bidding activity, or it appears likely that the auction will not close within a reasonable period of time or will close E:\FR\FM\12MYN1.SGM 12MYN1 22168 Federal Register / Vol. 74, No. 90 / Tuesday, May 12, 2009 / Notices prematurely. Before exercising certain of these options, the Bureau is likely to attempt to change the pace of the auction by, for example, changing the number of bidding rounds per day and/ or changing minimum acceptable bids. The Bureau proposes to retain the discretion to exercise any of these options with or without prior announcement during the auction. The Bureau seeks comment on these proposals. v. Information Relating to Auction Delay, Suspension, or Cancellation 16. For Auction 86, the Bureau proposes that, by public notice or by announcement during the auction, the Bureau may delay, suspend, or cancel the auction in the event of natural disaster, technical obstacle, administrative or weather necessity, evidence of an auction security breach or unlawful bidding activity, or for any other reason that affects the fair and efficient conduct of competitive bidding. The Bureau seeks comment on this proposal. B. Auction Procedures i. Upfront Payments and Bidding Eligibility 17. The Bureau proposes that the amount of the upfront payment submitted by a bidder will determine the bidder’s initial bidding eligibility in bidding units. The Bureau proposes that each license be assigned a specific number of bidding units equal to the upfront payment listed in Attachment A of the Auction 86 Comment Public Notice. 18. The proposed number of bidding units for each license and associated upfront payment amounts are listed in Attachment A. The Bureau seeks comment on these proposals. rwilkins on PROD1PC63 with NOTICES ii. Activity Rule 19. In order to ensure that the auction closes within a reasonable period of time, an activity rule requires bidders to bid actively throughout the auction, rather than wait until late in the auction before participating. A bidder’s activity in a round will be the sum of the bidding units associated with any licenses upon which it places bids during the current round and the bidding units associated with any licenses for which it holds provisionally winning bids. Bidders are required to be active on a specific percentage of their current bidding eligibility during each round of the auction. Failure to maintain the requisite activity level will result in the use of an activity rule waiver, if any remain, or a reduction in VerDate Nov<24>2008 17:14 May 11, 2009 Jkt 217001 the bidder’s eligibility, possibly curtailing or eliminating the bidder’s ability to place additional bids in the auction. 20. The Bureau proposes to divide the auction into at least two stages, each characterized by a different activity requirement. The auction will start in Stage One. The Bureau proposes to advance the auction to the next stage by announcement during the auction. In exercising this discretion, the Bureau will consider a variety of measures of auction activity, including but not limited to the percentage of licenses (as measured in bidding units) on which there are new bids, the number of new bids, and the increase in revenue. The Bureau seeks comment on these proposals. iii. Activity Rule Waivers and Reducing Eligibility 21. Use of an activity rule waiver preserves the bidder’s eligibility despite the bidder’s activity in the current round being below the required minimum level. An activity rule waiver applies to an entire round of bidding, not to particular licenses. Activity rule waivers can be either proactive or automatic and are principally a mechanism for bidders to avoid the loss of bidding eligibility in the event that exigent circumstances prevent them from bidding in a particular round. 22. The Bureau proposes that each bidder in Auction 86 be provided with three activity rule waivers that may be used as set forth above at the bidder’s discretion during the course of the auction. The Bureau seeks comment on this proposal. iv. Reserve Price or Minimum Opening Bids 23. The Bureau proposes to establish minimum opening bid amounts for Auction 86. The Bureau believes a minimum opening bid amount, which has been used in other auctions, is an effective bidding tool for accelerating the competitive bidding process. The Bureau does not propose a separate reserve price for the licenses to be offered in Auction 86. Specifically, for Auction 86, the Bureau proposes to calculate minimum opening bid amounts on a license-by-license basis using a formula based on bandwidth and license area population. The Bureau seeks comment on this approach, and, whether, consistent with Section 309(j), the public interest would be served by having no minimum opening bid amount or reserve price. PO 00000 Frm 00017 Fmt 4703 Sfmt 4703 v. Bid Amounts 24. The Bureau proposes that, in each round, eligible bidders be able to place a bid on a given license using one or more pre-defined bid amounts. Under this proposal, the FCC Auction System interface will list the acceptable bid amounts for each license. a. Minimum Acceptable Bids 25. The first of the acceptable bid amounts is called the minimum acceptable bid amount. The minimum acceptable bid amount for a license will be equal to its minimum opening bid amount until there is a provisionally winning bid on the license. After there is a provisionally winning bid for a license, the minimum acceptable bid amount for that license will be equal to the amount of the provisionally winning bid plus a percentage of that bid amount. In general, the percentage will be higher for a license receiving many bids than for a license receiving few bids. In the case of a license for which the provisionally winning bid has been withdrawn, the minimum acceptable bid amount will equal the second highest bid received for the license. 26. The percentage of the provisionally winning bid used to establish the minimum acceptable bid amount (the additional percentage) is calculated at the end of each round, based on an activity index. The activity index is a weighted average of (a) the number of distinct bidders placing a bid on the license, and (b) the activity index from the prior round. Specifically, the activity index is equal to a weighting factor times the number of bidders placing a bid covering the license in the most recent bidding round plus one minus the weighting factor times the activity index from the prior round. The additional percentage is determined as one plus the activity index times a minimum percentage amount, with the result not to exceed a given maximum. The additional percentage is then multiplied by the provisionally winning bid amount to obtain the minimum acceptable bid for the next round. The Bureau proposes initially to set the weighting factor at 0.5, the minimum percentage at 0.1 (10%), and the maximum percentage at 0.3 (30%). Hence, at these initial settings, the minimum acceptable bid for a license will be between ten percent and thirty percent higher than the provisionally winning bid, depending upon the bidding activity for the license. b. Additional Bid Amounts 27. Any additional bid amounts are calculated using the minimum E:\FR\FM\12MYN1.SGM 12MYN1 rwilkins on PROD1PC63 with NOTICES Federal Register / Vol. 74, No. 90 / Tuesday, May 12, 2009 / Notices acceptable bid amount and a bid increment percentage—more specifically, by multiplying the minimum acceptable bid by one plus successively higher multiples of the bid increment percentage. If, for example, the bid increment percentage is ten percent, the calculation of the first additional acceptable bid amount is (minimum acceptable bid amount) * (1 + 0.05), or (minimum acceptable bid amount) * 1.05; the second additional acceptable bid amount equals the minimum acceptable bid amount times one plus two times the bid increment percentage, or (minimum acceptable bid amount) * 1.1, etc. The Bureau will round the results of these calculations and the minimum acceptable bid calculations using the Bureau’s standard rounding procedures. The Bureau proposes to set the bid increment percentage at 0.05. 28. The Bureau seeks comment on whether to start with eight additional bid amounts (for a total of nine bid amounts) or with fewer or no additional bid amounts for Auction 86. In particular, commenters should address the issue of additional bid amounts in light of particular circumstances of Auction 86, including the nature of the license inventory. The Bureau retains the discretion to change the minimum acceptable bid amounts, the additional bid amounts, the number of acceptable bid amounts, and the parameters of the formulas used to calculate minimum acceptable bid amounts and additional bid amounts if it determines that circumstances so dictate. Further, the Bureau retains the discretion to do so on a license-by-license basis. 29. The Bureau also retains the discretion to limit (a) the amount by which a minimum acceptable bid for a license may increase compared with the corresponding provisionally winning bid, and (b) the amount by which an additional bid amount may increase compared with the immediately preceding acceptable bid amount. The Bureau seeks comment on the circumstances under which it should employ such a limit, factors it should consider when determining the dollar amount of the limit, and the tradeoffs in setting such a limit or changing parameters of the activity-based formula, such as changing the minimum percentage. If the Bureau exercises this discretion, it will alert bidders by announcement in the FCC Auction System. The Bureau seeks comment on the above proposals. vi. Provisionally Winning Bids 30. Provisionally winning bids are bids that would become final winning VerDate Nov<24>2008 17:14 May 11, 2009 Jkt 217001 bids if the auction were to close in that given round. At the end of a bidding round, a provisionally winning bid for each license will be determined based on the highest bid amount received for the license. In the event of identical high bid amounts being submitted on a license in a given round (i.e., tied bids), we will use a random number generator to select a single provisionally winning bid from among the tied bids. (Each bid is assigned a random number, and the tied bid with the highest random number wins the tiebreaker.) The remaining bidders, as well as the provisionally winning bidder, can submit higher bids in subsequent rounds. However, if the auction were to end with no other bids being placed, the winning bidder would be the one that placed the provisionally winning bid. If any bids are received on the license in a subsequent round, the provisionally winning bid again will be determined by the highest bid amount received for the license. 31. A provisionally winning bid will remain the provisionally winning bid until there is a higher bid on the license at the close of a subsequent round, unless the provisionally winning bid is withdrawn. Bidders are reminded that provisionally winning bids count toward activity for purposes of the activity rule. vii. Bid Removal 32. For Auction 86, the Bureau proposes and seeks comment on the following bid removal procedures. Before the close of a bidding round, a bidder has the option of removing any bid placed in that round. By removing selected bids in the FCC Auction System, a bidder may effectively undo any of its bids placed within that round. viii. Bid Withdrawal 33. A bidder may withdraw its provisionally winning bids using the withdraw bids function in the FCC Auction System. A bidder that withdraws its provisionally winning bid(s) is subject to the bid withdrawal payment provisions of the Commission rules. 34. For Auction 86, the Bureau proposes to limit each bidder to withdrawing provisionally winning bids in only one round during the course of the auction. To permit a bidder to withdraw bids in more than one round may encourage insincere bidding or the use of withdrawals for anti-competitive purposes. The round in which withdrawals may be used will be at the bidder’s discretion, and there is no limit on the number of provisionally winning bids that may be withdrawn during that PO 00000 Frm 00018 Fmt 4703 Sfmt 4703 22169 round. Withdrawals must be in accordance with the Commission’s rules, including the bid withdrawal payment provisions specified in 47 CFR 1.2104(g). The Bureau seeks comment on these bid withdrawal procedures. C. Post-Auction Procedures i. Establishing the Interim Withdrawal Payment Percentage 35. The Bureau seeks comment on the appropriate percentage of a withdrawn bid that should be assessed as an interim withdrawal payment in the event that a final withdrawal payment cannot be determined at the close of the auction. Balancing the potential need for bidders to use withdrawals to avoid winning incomplete combinations of licenses with our interest in deterring abuses of our bidding procedures, the Bureau proposes an interim bid withdrawal payment level of fifteen percent for Auction 86. 36. In general, the Commission’s rules provide that a bidder that withdraws a bid during an auction is subject to a withdrawal payment equal to the difference between the amount of the withdrawn bid and the amount of the winning bid in the same or subsequent auction(s). If a bid is withdrawn and no subsequent higher bid is placed and/or the license is not won in the same auction, the final withdrawal payment cannot be calculated until after the close of a subsequent auction in which a higher bid for the license (or the equivalent to the license) is placed or the license is won. When that final payment cannot yet be calculated, the bidder responsible for the withdrawn bid is assessed an interim bid withdrawal payment, which will be applied toward any final bid withdrawal payment that is ultimately assessed. 47 CFR 1.2104(g)(1) of the Commission rules requires that the percentage of the withdrawn bid to be assessed as an interim bid withdrawal payment be between three percent and twenty percent and that it be set in advance of the auction. 37. The Commission has determined that the level of the interim withdrawal payment in a particular auction will be based on the nature of the service and the inventory of the licenses being offered. The Commission has noted that it may impose a higher interim withdrawal payment percentage to deter the anti-competitive use of withdrawals when, for example, bidders likely will not need to aggregate the licenses being offered in the auction, such as when few licenses are offered that are on adjacent frequencies or in adjacent areas, or E:\FR\FM\12MYN1.SGM 12MYN1 22170 Federal Register / Vol. 74, No. 90 / Tuesday, May 12, 2009 / Notices when there are few synergies to be captured by combining licenses. 38. For Auction 86, it is not possible to combine licenses across multiple frequency blocks in a given geographic area, and opportunities for combining licenses in adjacent areas are somewhat limited, so there is likely to be little need to use withdrawals to protect against incomplete aggregations. Therefore, the Bureau proposes to establish the percentage of the withdrawn bid to be assessed as an interim bid withdrawal payment at fifteen percent for this auction. The Bureau seeks comment on this proposal. ii. Establishing the Additional Default Payment Percentage 39. Any winning bidder that, after the close of an auction, defaults—by, for example, failing to remit the required down payment within the prescribed period of time, to submit a timely longform application, or to make full payment—or is otherwise disqualified is liable for a default payment under 47 CFR 1.2104(g)(2). This payment consists of a deficiency payment, equal to the difference between the amount of the bidder’s bid and the amount of the winning bid the next time a license covering the same spectrum is won in an auction, plus an additional payment equal to a percentage of the defaulter’s bid or of the subsequent winning bid, whichever is less. 40. As previously noted by the Commission, defaults weaken the integrity of the auctions process and impede the deployment of service to the public. Given the nature of the service and the inventory of the licenses being offered in Auction 86, the Bureau believes that an additional default payment percentage of fifteen percent will provide a sufficient deterrent to defaults. Accordingly, the Bureau proposes an additional default payment of fifteen percent of the relevant bid for Auction 86 and seeks comment on this proposal. rwilkins on PROD1PC63 with NOTICES III. Commission ex parte Rules 41. This proceeding has been designated as a permit-but-disclose proceeding in accordance with the Commission’s ex parte rules. Persons making oral ex parte presentations are reminded that memoranda summarizing the presentations must contain summaries of the substance of the presentations and not merely a listing of the subjects discussed. More than a one or two sentence description of the views and arguments presented is generally required. Other rules pertaining to oral and written ex parte presentations in VerDate Nov<24>2008 17:14 May 11, 2009 Jkt 217001 permit-but-disclose proceedings are set forth in 47 CFR 1.1206(b). Federal Communications Commission. Gary D. Michaels, Deputy Chief, Auctions and Spectrum Access Division, WTB. [FR Doc. E9–11076 Filed 5–11–09; 8:45 am] BILLING CODE 6712–01–P FEDERAL RESERVE SYSTEM Sunshine Act Meeting Board of Governors of the Federal Reserve System. TIME AND DATE: 11:30 a.m., Monday, May 18, 2009. PLACE: Marriner S. Eccles Federal Reserve Board Building, 20th and C Streets, N.W., Washington, D.C. 20551. STATUS: Closed. MATTERS TO BE CONSIDERED: 1. Personnel actions (appointments, promotions, assignments, reassignments, and salary actions) involving individual Federal Reserve System employees. 2. Any items carried forward from a previously announced meeting. FOR FURTHER INFORMATION CONTACT: Michelle Smith, Director, or Dave Skidmore, Assistant to the Board, Office of Board Members at 202–452–2955. SUPPLEMENTARY INFORMATION: You may call 202–452–3206 beginning at approximately 5 p.m. two business days before the meeting for a recorded announcement of bank and bank holding company applications scheduled for the meeting; or you may contact the Board’s Web site at https:// www.federalreserve.gov for an electronic announcement that not only lists applications, but also indicates procedural and other information about the meeting. AGENCY HOLDING THE MEETING: Board of Governors of the Federal Reserve System, May 8, 2009. Robert deV. Frierson, Deputy Secretary of the Board. [FR Doc. E9–11199 Filed 5–8–09; 4:15 pm] BILLING CODE 6210–01–S DEPARTMENT OF HEALTH AND HUMAN SERVICES National Biodefense Science Board; Notification of a Public Teleconference AGENCY: Department of Health and Human Services, Office of the Secretary. ACTION: Notice. SUMMARY: As stipulated by the Federal Advisory Committee Act, the U.S. PO 00000 Frm 00019 Fmt 4703 Sfmt 4703 Department of Health and Human Services is hereby giving notice that the National Biodefense Science Board (NBSB) will be holding a public teleconference. The meeting is open to the public. DATES: The NBSB will hold a public teleconference on May 22, 2009. The teleconference will be held from 2 p.m. to 4 p.m. EDT. ADDRESSES: The conference will be conducted by phone. Public Conference Call-in Number is available by e-mailing NBSB@hhs.gov and will be posted on the NBSB Web site at https:// www.hhs.gov/aspr/omsph/nbsb/ index.html prior to the meeting. Participants should call in 15 minutes prior to the call and will be asked to provide their name, title, and organization. FOR FURTHER INFORMATION CONTACT: Any member of the public wishing to obtain general information concerning this public teleconference should contact NBSB@hhs.gov. Pursuant to section 319M of the Public Health Service Act (42 U.S.C. 247d–7f) and section 222 of the Public Health Service Act (42 U.S.C. 217a), the Department of Health and Human Services established the National Biodefense Science Board. The Board shall provide expert advice and guidance to the Secretary on scientific, technical, and other matters of special interest to the Department of Health and Human Services regarding current and future chemical, biological, nuclear, and radiological agents, whether naturally occurring, accidental, or deliberate. The Board may also provide advice and guidance to the Secretary on other matters related to public health emergency preparedness and response. Background: The purpose of the May 22, 2009 teleconference is to discuss issues regarding the 2009 H1N1 influenza outbreak. A special meeting of the Board is being convened to assure that the public is given the opportunity to provide comments on the actions and deliberations of the Board regarding the ongoing response to the H1N1 influenza. There will be time for members of the public to present their comments to the Board on this subject matter. Availability of Materials: The agenda and other materials will be posted on the NBSB Web site at https:// www.hhs.gov/aspr/omsph/nbsb/ index.html prior to the meeting. Procedures for Providing Public Input: Interested members of the public may submit relevant written or oral SUPPLEMENTARY INFORMATION: E:\FR\FM\12MYN1.SGM 12MYN1

Agencies

[Federal Register Volume 74, Number 90 (Tuesday, May 12, 2009)]
[Notices]
[Pages 22166-22170]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-11076]


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FEDERAL COMMUNICATIONS COMMISSION

[AU Docket No. 09-56; DA 09-843]


Auction of FM Broadband Radio Service (BRS) Licenses Scheduled 
for October 27, 2009; Comment Sought on Competitive Bidding Procedures 
for Auction 86

AGENCY: Federal Communications Commission.

ACTION: Notice.

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SUMMARY: This document announces the auction of unassigned Broadband 
Radio Service (BRS) licenses scheduled to commence on October 27, 2009 
(Auction 86). This document also seeks comments on competitive bidding 
procedures for Auction 86.

DATES: Comments are due on or before May 15, 2009, and reply comments 
are due on or before May 29, 2009.

ADDRESSES: Comments and reply comments must be identified by AU Docket 
No. 09-56. Comments may be filed electronically using the Internet by 
accessing the Federal Communications Commission's Electronic Comment 
Filing System (ECFS) at https://www.fcc.gov/cgb/ecfs. Filers should 
follow the instructions provided on the Web site for submitting 
comments. The Wireless Telecommunications Bureau requests that a copy 
of all comments and reply comments be submitted electronically to the 
following address: auction86@fcc.gov. In addition, comments and reply 
comments may be submitted by any of the following methods:
     Paper Filers: Parties who choose to file by paper must 
file an original and four copies of each filing. Filings can be sent by 
hand or messenger delivery, by commercial overnight courier, or by 
first-class or overnight U.S. Postal Service mail (although the Bureaus 
continue to experience delays in receiving U.S. Postal Service mail). 
All filings must be addressed to the Commission's Secretary, Attn: WTB/
ASAD, Office of the Secretary, Federal Communications Commission.
     The Commission's contractor will receive hand-delivered or 
messenger-delivered paper filings for the Commission's Secretary at 236 
Massachusetts Avenue, NE., Suite 110, Washington, DC 20002. The filing 
hours at this location are 8 a.m. to 7 p.m. Eastern Time (ET). All hand 
deliveries must be held together with rubber bands or fasteners. 
Commercial overnight mail (other than U.S. Postal Service Express Mail 
and Priority Mail) must be sent to 9300 East Hampton Drive, Capitol 
Heights, MD 20743.
     U.S. Postal Service first-class, Express, and Priority 
mail should be addressed to 445 12th Street, SW., Washington, DC 20554.
     People With Disabilities: Contact the FCC to request 
reasonable accommodations (accessible format documents, sign language 
interpreters, CART, etc.) by e-mail: FCC504@fcc.gov or telephone: 202-
418-0530 or TTY: 202-418-0432.

FOR FURTHER INFORMATION CONTACT: Wireless Telecommunications Bureau, 
Auctions and Spectrum Access Division: For auction legal questions: 
Sayuri Rajapakse at (202) 418-0660. For general auction questions: Jeff 
Crooks at (202) 418-0660 or Lisa Stover at (717) 338-2868; Broadband 
Division: For BRS service rule questions: Nancy Zaczek (legal) or 
Stephen Zak (technical) at (202) 418-2487.

SUPPLEMENTARY INFORMATION: This is a summary of the Auction 86 Comment 
Public Notice released on April 24, 2009. The complete text of the 
Auction 86 Comment Public Notice, including Attachments A and B, and 
related Commission documents, are available for public inspection and 
copying from 8 a.m. to 4:30 p.m. ET Monday through Thursday or from 8 
a.m. to 11:30 a.m. ET on Fridays in the FCC Reference Information 
Center, 445 12th Street, SW., Room CY-A257, Washington, DC 20554. The 
Auction 86 Comment Public Notice and related Commission documents also 
may be purchased from the Commission's duplicating contractor, Best 
Copy and Printing, Inc. (BCPI), 445 12th Street, SW., Room CY-B402, 
Washington, DC 20554, telephone 202-488-5300, facsimile 202-488-5563, 
or you may contact BCPI at its Web site: https://www.BCPIWEB.com. When 
ordering documents from BCPI, please provide the appropriate FCC 
document number, for example, DA 09-843. The Auction 86 Comment Public 
Notice and related documents also are available on the Internet at the 
Commission's website: https://wireless.fcc.gov/auctions/86/, or by using 
the search function for AU Docket No. 09-56 on the ECFS Web page at 
https://www.fcc.gov/cgb/ecfs/.

I. Licenses To Be Offered in Auction 86

    1. The licenses to be offered in Auction 86 consist of the 
available spectrum in 78 BRS service areas. BRS service areas are BTAs 
or additional service areas similar to BTAs adopted by the Commission. 
Overlay licenses for 75 of the BTAs originally offered in Auction 6 are 
available now as a result of default, cancellation, or termination. 
This auction will also include three

[[Page 22167]]

additional licenses for BRS service areas in the Gulf of Mexico. A 
complete list of licenses available for Auction 86 is included as 
Attachment A of the Auction 86 Comment Public Notice.
    2. Where unencumbered, the licenses to be auctioned consist of 76.5 
megahertz of spectrum at 2496-2502, 2602-2614, 2614-2615, 2616-2618, 
and 2618-2673.5 MHz. The Bureau notes that the licenses issued pursuant 
to this auction will be issued pursuant to the post-transition band 
plan contained in 47 CFR 27.5(i)(2). A table showing the channelization 
of this spectrum is included as Attachment B of the Auction 86 Comment 
Public Notice.
    3. Incumbency Issues. There are pre-existing BRS incumbent 
licenses. The service area for each of those site-based licenses is a 
35-mile circle centered at the station's reference coordinates, and is 
bounded by the chord(s) drawn between the intersection points of the 
licensee's previous protected service area and those of respective 
adjacent market, co-channel licensees. Any licenses granted pursuant to 
this auction will not include the geographic service areas of any 
overlapping, co-channel incumbent licenses. If an incumbent license 
cancels or is forfeited, however, the right to operate within that area 
shall revert to the overlay licensee that holds the license for the BRS 
service area that encompasses that BTA. BRS incumbent licenses are 
entitled to interference protection in accordance with the applicable 
technical rules.
    4. In addition, on the E and F channel groups, grandfathered 
Educational Broadband Service licenses originally issued on those 
channels prior to 1983 may continue to operate indefinitely. Such 
grandfathered EBS licenses must be protected in accordance with the 
applicable technical rules.
    5. Operations within the 2614-2618 MHz band are secondary to 
adjacent channel operations.
    6. Finally, in the 2496-2500 MHz band, BRS licensees must share the 
band on a co-primary basis with the Code Division Multiple Access 
Mobile Satellite Service, grandfathered Broadcast Auxiliary Service 
stations, and grandfathered land mobile and microwave licenses licensed 
under Parts 90 and 101 of the Commission's rules, respectively. In 
addition, the 2400-2500 MHz band is allocated for use by Industrial, 
Scientific, and Medical equipment under Part 18 of the Commission's 
rules.

II. Bureau Seeks Comment on Auction Procedures

A. Auction Structure

i. Simultaneous Multiple-Round Auction Design
    7. The Bureau proposed to auction all licenses included in Auction 
86 using the Commission's standard simultaneous multiple-round auction 
format. This type of auction offers every license for bid at the same 
time and consists of successive bidding rounds in which eligible 
bidders may place bids on individual licenses. Typically, bidding 
remains open on all licenses until bidding stops on every license. The 
Bureau seeks comment on this proposal.
ii. Anonymous Bidding
    8. The Bureau proposes to conduct Auction 86 using certain 
procedures for limited information disclosure or anonymous bidding. 
Specifically, the Bureau proposes to withhold, until after the close of 
bidding, public release of (1) Bidders' license selections on their 
short-form applications (FCC Form 175), (2) the amounts of bidders' 
upfront payments and bidding eligibility, and (3) information that may 
reveal the identities of bidders placing bids and taking other bidding-
related actions.
    9. The Bureau seeks comment on the details regarding our proposal 
for implementation of anonymous bidding in Auction 86, and on 
alternative proposals for anonymous bidding or other information 
disclosure procedures.
iii. Bidding Rounds
    10. Auction 86 will consist of sequential bidding rounds. The 
initial bidding schedule will be announced in a public notice to be 
released at least one week before the start of the auction.
    11. The Commission will conduct Auction 86 over the Internet, and 
telephonic bidding will be available as well. The toll-free telephone 
number for the Auction Bidder Line will be provided to qualified 
bidders.
    12. The Bureau proposes to retain the discretion to change the 
bidding schedule in order to foster an auction pace that reasonably 
balances speed with the bidders' need to study round results and adjust 
their bidding strategies. Under this proposal, the Bureau may change 
the amount of time for bidding rounds, the amount of time between 
rounds, or the number of rounds per day, depending upon bidding 
activity and other factors. The Bureau seeks comment on this proposal. 
Commenters may wish to address the role of the bidding schedule in 
managing the pace of the auction and the tradeoffs in managing auction 
pace by bidding schedule changes, by changing the activity requirements 
or bid amount parameters, or by using other means.
iv. Stopping Rule
    13. For Auction 86, the Bureau proposes to employ a simultaneous 
stopping rule approach. A simultaneous stopping rule means that all 
licenses remain available for bidding until bidding closes 
simultaneously on all licenses. More specifically, bidding will close 
simultaneously on all licenses after the first round in which no bidder 
submits any new bids, applies a proactive waiver, or withdraws any 
provisionally winning bids. Thus, unless the Bureau announces 
alternative stopping procedures, bidding will remain open on all 
licenses until bidding stops on every license. Consequently, it is not 
possible to determine in advance how long the auction will last.
    14. Further, the Bureau proposes to retain the discretion to 
exercise any of the following options during Auction 86: (1) Use a 
modified version of the simultaneous stopping rule. The modified 
stopping rule would close the auction for all licenses after the first 
round in which no bidder applies a waiver, withdraws a provisionally 
winning bid, or places any new bids on any license for which it is not 
the provisionally winning bidder. Thus, absent any other bidding 
activity, a bidder placing a new bid on a license for which it is the 
provisionally winning bidder would not keep the auction open under this 
modified stopping rule; (2) declare that the auction will end after a 
specified number of additional rounds (special stopping rule). If the 
Bureau invokes this special stopping rule, it will accept bids in the 
specified final round(s) after which the auction will close; and (3) 
keep the auction open even if no bidder submits any new bids, applies a 
waiver, or withdraws any provisionally winning bids. In this event, the 
effect will be the same as if a bidder had applied a waiver. The 
activity rule, therefore, will apply as usual and a bidder with 
insufficient activity will either lose bidding eligibility or use a 
waiver.
    15. The Bureau proposed to exercise these options only in certain 
circumstances, for example, where the auction is proceeding unusually 
slowly or quickly, there is minimal overall bidding activity, or it 
appears likely that the auction will not close within a reasonable 
period of time or will close

[[Page 22168]]

prematurely. Before exercising certain of these options, the Bureau is 
likely to attempt to change the pace of the auction by, for example, 
changing the number of bidding rounds per day and/or changing minimum 
acceptable bids. The Bureau proposes to retain the discretion to 
exercise any of these options with or without prior announcement during 
the auction. The Bureau seeks comment on these proposals.
v. Information Relating to Auction Delay, Suspension, or Cancellation
    16. For Auction 86, the Bureau proposes that, by public notice or 
by announcement during the auction, the Bureau may delay, suspend, or 
cancel the auction in the event of natural disaster, technical 
obstacle, administrative or weather necessity, evidence of an auction 
security breach or unlawful bidding activity, or for any other reason 
that affects the fair and efficient conduct of competitive bidding. The 
Bureau seeks comment on this proposal.

B. Auction Procedures

i. Upfront Payments and Bidding Eligibility
    17. The Bureau proposes that the amount of the upfront payment 
submitted by a bidder will determine the bidder's initial bidding 
eligibility in bidding units. The Bureau proposes that each license be 
assigned a specific number of bidding units equal to the upfront 
payment listed in Attachment A of the Auction 86 Comment Public Notice.
    18. The proposed number of bidding units for each license and 
associated upfront payment amounts are listed in Attachment A. The 
Bureau seeks comment on these proposals.
ii. Activity Rule
    19. In order to ensure that the auction closes within a reasonable 
period of time, an activity rule requires bidders to bid actively 
throughout the auction, rather than wait until late in the auction 
before participating. A bidder's activity in a round will be the sum of 
the bidding units associated with any licenses upon which it places 
bids during the current round and the bidding units associated with any 
licenses for which it holds provisionally winning bids. Bidders are 
required to be active on a specific percentage of their current bidding 
eligibility during each round of the auction. Failure to maintain the 
requisite activity level will result in the use of an activity rule 
waiver, if any remain, or a reduction in the bidder's eligibility, 
possibly curtailing or eliminating the bidder's ability to place 
additional bids in the auction.
    20. The Bureau proposes to divide the auction into at least two 
stages, each characterized by a different activity requirement. The 
auction will start in Stage One. The Bureau proposes to advance the 
auction to the next stage by announcement during the auction. In 
exercising this discretion, the Bureau will consider a variety of 
measures of auction activity, including but not limited to the 
percentage of licenses (as measured in bidding units) on which there 
are new bids, the number of new bids, and the increase in revenue. The 
Bureau seeks comment on these proposals.
iii. Activity Rule Waivers and Reducing Eligibility
    21. Use of an activity rule waiver preserves the bidder's 
eligibility despite the bidder's activity in the current round being 
below the required minimum level. An activity rule waiver applies to an 
entire round of bidding, not to particular licenses. Activity rule 
waivers can be either proactive or automatic and are principally a 
mechanism for bidders to avoid the loss of bidding eligibility in the 
event that exigent circumstances prevent them from bidding in a 
particular round.
    22. The Bureau proposes that each bidder in Auction 86 be provided 
with three activity rule waivers that may be used as set forth above at 
the bidder's discretion during the course of the auction. The Bureau 
seeks comment on this proposal.
iv. Reserve Price or Minimum Opening Bids
    23. The Bureau proposes to establish minimum opening bid amounts 
for Auction 86. The Bureau believes a minimum opening bid amount, which 
has been used in other auctions, is an effective bidding tool for 
accelerating the competitive bidding process. The Bureau does not 
propose a separate reserve price for the licenses to be offered in 
Auction 86. Specifically, for Auction 86, the Bureau proposes to 
calculate minimum opening bid amounts on a license-by-license basis 
using a formula based on bandwidth and license area population. The 
Bureau seeks comment on this approach, and, whether, consistent with 
Section 309(j), the public interest would be served by having no 
minimum opening bid amount or reserve price.
v. Bid Amounts
    24. The Bureau proposes that, in each round, eligible bidders be 
able to place a bid on a given license using one or more pre-defined 
bid amounts. Under this proposal, the FCC Auction System interface will 
list the acceptable bid amounts for each license.
a. Minimum Acceptable Bids
    25. The first of the acceptable bid amounts is called the minimum 
acceptable bid amount. The minimum acceptable bid amount for a license 
will be equal to its minimum opening bid amount until there is a 
provisionally winning bid on the license. After there is a 
provisionally winning bid for a license, the minimum acceptable bid 
amount for that license will be equal to the amount of the 
provisionally winning bid plus a percentage of that bid amount. In 
general, the percentage will be higher for a license receiving many 
bids than for a license receiving few bids. In the case of a license 
for which the provisionally winning bid has been withdrawn, the minimum 
acceptable bid amount will equal the second highest bid received for 
the license.
    26. The percentage of the provisionally winning bid used to 
establish the minimum acceptable bid amount (the additional percentage) 
is calculated at the end of each round, based on an activity index. The 
activity index is a weighted average of (a) the number of distinct 
bidders placing a bid on the license, and (b) the activity index from 
the prior round. Specifically, the activity index is equal to a 
weighting factor times the number of bidders placing a bid covering the 
license in the most recent bidding round plus one minus the weighting 
factor times the activity index from the prior round. The additional 
percentage is determined as one plus the activity index times a minimum 
percentage amount, with the result not to exceed a given maximum. The 
additional percentage is then multiplied by the provisionally winning 
bid amount to obtain the minimum acceptable bid for the next round. The 
Bureau proposes initially to set the weighting factor at 0.5, the 
minimum percentage at 0.1 (10%), and the maximum percentage at 0.3 
(30%). Hence, at these initial settings, the minimum acceptable bid for 
a license will be between ten percent and thirty percent higher than 
the provisionally winning bid, depending upon the bidding activity for 
the license.
b. Additional Bid Amounts
    27. Any additional bid amounts are calculated using the minimum

[[Page 22169]]

acceptable bid amount and a bid increment percentage--more 
specifically, by multiplying the minimum acceptable bid by one plus 
successively higher multiples of the bid increment percentage. If, for 
example, the bid increment percentage is ten percent, the calculation 
of the first additional acceptable bid amount is (minimum acceptable 
bid amount) * (1 + 0.05), or (minimum acceptable bid amount) * 1.05; 
the second additional acceptable bid amount equals the minimum 
acceptable bid amount times one plus two times the bid increment 
percentage, or (minimum acceptable bid amount) * 1.1, etc. The Bureau 
will round the results of these calculations and the minimum acceptable 
bid calculations using the Bureau's standard rounding procedures. The 
Bureau proposes to set the bid increment percentage at 0.05.
    28. The Bureau seeks comment on whether to start with eight 
additional bid amounts (for a total of nine bid amounts) or with fewer 
or no additional bid amounts for Auction 86. In particular, commenters 
should address the issue of additional bid amounts in light of 
particular circumstances of Auction 86, including the nature of the 
license inventory. The Bureau retains the discretion to change the 
minimum acceptable bid amounts, the additional bid amounts, the number 
of acceptable bid amounts, and the parameters of the formulas used to 
calculate minimum acceptable bid amounts and additional bid amounts if 
it determines that circumstances so dictate. Further, the Bureau 
retains the discretion to do so on a license-by-license basis.
    29. The Bureau also retains the discretion to limit (a) the amount 
by which a minimum acceptable bid for a license may increase compared 
with the corresponding provisionally winning bid, and (b) the amount by 
which an additional bid amount may increase compared with the 
immediately preceding acceptable bid amount. The Bureau seeks comment 
on the circumstances under which it should employ such a limit, factors 
it should consider when determining the dollar amount of the limit, and 
the tradeoffs in setting such a limit or changing parameters of the 
activity-based formula, such as changing the minimum percentage. If the 
Bureau exercises this discretion, it will alert bidders by announcement 
in the FCC Auction System. The Bureau seeks comment on the above 
proposals.
vi. Provisionally Winning Bids
    30. Provisionally winning bids are bids that would become final 
winning bids if the auction were to close in that given round. At the 
end of a bidding round, a provisionally winning bid for each license 
will be determined based on the highest bid amount received for the 
license. In the event of identical high bid amounts being submitted on 
a license in a given round (i.e., tied bids), we will use a random 
number generator to select a single provisionally winning bid from 
among the tied bids. (Each bid is assigned a random number, and the 
tied bid with the highest random number wins the tiebreaker.) The 
remaining bidders, as well as the provisionally winning bidder, can 
submit higher bids in subsequent rounds. However, if the auction were 
to end with no other bids being placed, the winning bidder would be the 
one that placed the provisionally winning bid. If any bids are received 
on the license in a subsequent round, the provisionally winning bid 
again will be determined by the highest bid amount received for the 
license.
    31. A provisionally winning bid will remain the provisionally 
winning bid until there is a higher bid on the license at the close of 
a subsequent round, unless the provisionally winning bid is withdrawn. 
Bidders are reminded that provisionally winning bids count toward 
activity for purposes of the activity rule.
vii. Bid Removal
    32. For Auction 86, the Bureau proposes and seeks comment on the 
following bid removal procedures. Before the close of a bidding round, 
a bidder has the option of removing any bid placed in that round. By 
removing selected bids in the FCC Auction System, a bidder may 
effectively undo any of its bids placed within that round.
viii. Bid Withdrawal
    33. A bidder may withdraw its provisionally winning bids using the 
withdraw bids function in the FCC Auction System. A bidder that 
withdraws its provisionally winning bid(s) is subject to the bid 
withdrawal payment provisions of the Commission rules.
    34. For Auction 86, the Bureau proposes to limit each bidder to 
withdrawing provisionally winning bids in only one round during the 
course of the auction. To permit a bidder to withdraw bids in more than 
one round may encourage insincere bidding or the use of withdrawals for 
anti-competitive purposes. The round in which withdrawals may be used 
will be at the bidder's discretion, and there is no limit on the number 
of provisionally winning bids that may be withdrawn during that round. 
Withdrawals must be in accordance with the Commission's rules, 
including the bid withdrawal payment provisions specified in 47 CFR 
1.2104(g). The Bureau seeks comment on these bid withdrawal procedures.

C. Post-Auction Procedures

i. Establishing the Interim Withdrawal Payment Percentage
    35. The Bureau seeks comment on the appropriate percentage of a 
withdrawn bid that should be assessed as an interim withdrawal payment 
in the event that a final withdrawal payment cannot be determined at 
the close of the auction. Balancing the potential need for bidders to 
use withdrawals to avoid winning incomplete combinations of licenses 
with our interest in deterring abuses of our bidding procedures, the 
Bureau proposes an interim bid withdrawal payment level of fifteen 
percent for Auction 86.
    36. In general, the Commission's rules provide that a bidder that 
withdraws a bid during an auction is subject to a withdrawal payment 
equal to the difference between the amount of the withdrawn bid and the 
amount of the winning bid in the same or subsequent auction(s). If a 
bid is withdrawn and no subsequent higher bid is placed and/or the 
license is not won in the same auction, the final withdrawal payment 
cannot be calculated until after the close of a subsequent auction in 
which a higher bid for the license (or the equivalent to the license) 
is placed or the license is won. When that final payment cannot yet be 
calculated, the bidder responsible for the withdrawn bid is assessed an 
interim bid withdrawal payment, which will be applied toward any final 
bid withdrawal payment that is ultimately assessed. 47 CFR 1.2104(g)(1) 
of the Commission rules requires that the percentage of the withdrawn 
bid to be assessed as an interim bid withdrawal payment be between 
three percent and twenty percent and that it be set in advance of the 
auction.
    37. The Commission has determined that the level of the interim 
withdrawal payment in a particular auction will be based on the nature 
of the service and the inventory of the licenses being offered. The 
Commission has noted that it may impose a higher interim withdrawal 
payment percentage to deter the anti-competitive use of withdrawals 
when, for example, bidders likely will not need to aggregate the 
licenses being offered in the auction, such as when few licenses are 
offered that are on adjacent frequencies or in adjacent areas, or

[[Page 22170]]

when there are few synergies to be captured by combining licenses.
    38. For Auction 86, it is not possible to combine licenses across 
multiple frequency blocks in a given geographic area, and opportunities 
for combining licenses in adjacent areas are somewhat limited, so there 
is likely to be little need to use withdrawals to protect against 
incomplete aggregations. Therefore, the Bureau proposes to establish 
the percentage of the withdrawn bid to be assessed as an interim bid 
withdrawal payment at fifteen percent for this auction. The Bureau 
seeks comment on this proposal.
ii. Establishing the Additional Default Payment Percentage
    39. Any winning bidder that, after the close of an auction, 
defaults--by, for example, failing to remit the required down payment 
within the prescribed period of time, to submit a timely long-form 
application, or to make full payment--or is otherwise disqualified is 
liable for a default payment under 47 CFR 1.2104(g)(2). This payment 
consists of a deficiency payment, equal to the difference between the 
amount of the bidder's bid and the amount of the winning bid the next 
time a license covering the same spectrum is won in an auction, plus an 
additional payment equal to a percentage of the defaulter's bid or of 
the subsequent winning bid, whichever is less.
    40. As previously noted by the Commission, defaults weaken the 
integrity of the auctions process and impede the deployment of service 
to the public. Given the nature of the service and the inventory of the 
licenses being offered in Auction 86, the Bureau believes that an 
additional default payment percentage of fifteen percent will provide a 
sufficient deterrent to defaults. Accordingly, the Bureau proposes an 
additional default payment of fifteen percent of the relevant bid for 
Auction 86 and seeks comment on this proposal.

III. Commission ex parte Rules

    41. This proceeding has been designated as a permit-but-disclose 
proceeding in accordance with the Commission's ex parte rules. Persons 
making oral ex parte presentations are reminded that memoranda 
summarizing the presentations must contain summaries of the substance 
of the presentations and not merely a listing of the subjects 
discussed. More than a one or two sentence description of the views and 
arguments presented is generally required. Other rules pertaining to 
oral and written ex parte presentations in permit-but-disclose 
proceedings are set forth in 47 CFR 1.1206(b).

Federal Communications Commission.
Gary D. Michaels,
Deputy Chief, Auctions and Spectrum Access Division, WTB.
[FR Doc. E9-11076 Filed 5-11-09; 8:45 am]
BILLING CODE 6712-01-P
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