Further Proposed Interpretations of Parts of the Middle Class Tax Relief and Job Creation Act of 2012, 13336-13351 [2015-05855]
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[FR Doc. 2015–05779 Filed 3–12–15; 8:45 am]
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DEPARTMENT OF COMMERCE
Notice of Public Meeting of the
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[FR Doc. 2015–05698 Filed 3–12–15; 8:45 am]
BILLING CODE 3510–HR–P
DEPARTMENT OF COMMERCE
National Telecommunications and
Information Administration
First Responder Network Authority
[Docket Number 150306226–5226–01]
RIN 0660–XC017
Further Proposed Interpretations of
Parts of the Middle Class Tax Relief
and Job Creation Act of 2012
First Responder Network
Authority, National
Telecommunications and Information
Administration, U.S. Department of
Commerce.
ACTION: Notice and request for
comments.
AGENCY:
The First Responder Network
Authority (‘‘FirstNet’’) publishes this
Second Notice to request public
comment on certain proposed
interpretations of its enabling legislation
that will inform, among other things,
network policies, forthcoming requests
SUMMARY:
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for proposals, and interpretive rules.
With the benefit of the comments
received from this Second Notice,
FirstNet may proceed to implement
these or other interpretations with or
without further administrative
procedure.
Submit comments on or before
April 13, 2015.
ADDRESSES: The public is invited to
submit written comments to this Second
Notice. Written comments may be
submitted electronically through
www.regulations.gov or by mail (to the
address listed below). Comments
received related to this Second Notice
will be made a part of the public record
and will be posted to
www.regulations.gov without change.
Comments should be machine-readable
and should not be copy-protected.
Comments should include the name of
the person or organization filing the
comment as well as a page number on
each page of the submission. All
personally identifiable information (e.g.,
name, address) voluntarily submitted by
the commenter may be publicly
accessible. Do not submit confidential
business information or otherwise
sensitive or protected information.
FOR FURTHER INFORMATION CONTACT: Eli
Veenendaal, First Responder Network
Authority, National
Telecommunications and Information
Administration, U.S. Department of
Commerce, 12201 Sunrise Valley Drive,
M/S 243, Reston, VA 20192; 703–648–
4167; or elijah.veenendaal@firstnet.gov.
SUPPLEMENTARY INFORMATION:
DATES:
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I. Introduction and Background
The Middle Class Tax Relief and Job
Creation Act of 2012 (Pub. L. 112–96,
Title VI, 126 Stat. 256 (codified at 47
U.S.C. 1401 et seq.)) (the ‘‘Act’’)
established the First Responder Network
Authority (‘‘FirstNet’’) as an
independent authority within the
National Telecommunications and
Information Administration (‘‘NTIA’’).
The Act establishes FirstNet’s duty and
responsibility to take all actions
necessary to ensure the building,
deployment, and operation of a
nationwide public safety broadband
network (‘‘NPSBN’’).1
As detailed in our ‘‘Proposed
Interpretations of Parts of the Middle
Class Tax Relief and Job Creation Act of
2012’’ (‘‘First Notice’’) the rights and
obligations of FirstNet, States and
territories, and state, federal, local, and
tribal public safety entities, among other
stakeholders, turn on interpretation of
1 47
U.S.C. 1426(b).
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the Act’s terms and provisions.2 In this
Second Notice, we make preliminary
conclusions on a range of issues,
including the equipment for use on the
FirstNet network, the nature and
application of FirstNet’s required
network policies, FirstNet’s presentation
of a state plan and its implications for
the rights and duties of other
stakeholders, and the rights of States
choosing to assume responsibility to
build and operate a radio access
network (‘‘RAN’’) in said State. We
believe that consideration of these
preliminary conclusions and ultimately
making final determinations on these
matters will further guide all parties
with regard to the building, deployment,
and operation of the NPSBN.
Consistent with our approach in the
First Notice, although FirstNet is exempt
from the procedural requirements of the
Administrative Procedure Act
(‘‘APA’’),3 FirstNet desires to solicit
public comments on foundational legal
issues, in addition to technical and
economic issues, to guide our efforts in
achieving our mission.4 Thus, in general
FirstNet may pursue APA-like public
notice and comment processes such as
this Second Notice, and we intend to
rely upon comments filed in response to
this Second Notice to inform our
actions, including the establishment of
network policies, development of
requests for proposals (‘‘RFPs’’), and
other duties FirstNet is assigned under
the Act.
With respect to this Second Notice, in
instances where we have drawn a
preliminary conclusion and sought
comments thereon, we currently intend
to issue a subsequent document
indicating final interpretative
determinations, taking into
consideration the comments received.
This subsequent document might not
precede release of the above-mentioned
RFPs, which will nonetheless
incorporate and constitute such final
interpretive determinations in light of
the received comments. Further,
although we may, we do not currently
anticipate issuing further public notices
and/or opportunities for comment or
reply comments on the preliminary
conclusions made in this Second
Notice, and thus encourage interested
parties to provide comments in this
proceeding.
In instances where we have not drawn
a preliminary conclusion, but have
sought information and comment on an
2 The pronouns ‘‘we’’ or ‘‘our’’ throughout this
Second Notice refer to ‘‘FirstNet’’ alone and not
FirstNet, NTIA, and the U.S. Department of
Commerce as a collective group.
3 47 U.S.C. 1426(d)(2).
4 See 79 FR 57058–9 (September 24, 2014).
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issue, we may issue additional notices
seeking comments on any preliminary
conclusions we may reach following
review and consideration of the
comments responding to this Second
Notice. That notice, if issued, may then
be followed by notice of final
determinations. However, because we
may not issue such a further notice of
preliminary conclusions at all or prior
to releasing the above-mentioned RFPs,
we again encourage interested parties to
provide comments in this proceeding.
II. Issues
A. Technical Requirements Relating to
Equipment for Use on the NPSBN
In the First Notice, we explored the
network elements that comprise the
NPSBN. We address below a separate
section of the Act concerning equipment
for use on the network. Our overarching
considerations in these interpretations
are the Act’s goals regarding the
interoperability of the network across all
geographies and the cost-effectiveness of
devices for public safety.
Section 6206(b)(2)(B) requires
FirstNet to ‘‘promote competition in the
equipment market, including devices for
public safety communications, by
requiring that equipment for use on the
network be: (a) Built to open, nonproprietary, commercially available
standards; (b) capable of being used by
any public safety entity and by multiple
vendors across all public safety
broadband networks operating in the
700 MHz band; and (c) backwardcompatible with existing commercial
networks to the extent that such
capabilities are necessary and
technically and economically
reasonable.’’ 5 Several critical terms in
this provision must be interpreted to
allow FirstNet to develop requests for
proposals and network policies that will
fulfill these requirements.
First, we must determine the scope of
the ‘‘equipment’’ that must satisfy the
requirements of Section 6206(b)(2)(B).
The Act states that this Section applies
only to equipment ‘‘for use on’’ the
NPSBN, rather than, for example,
‘‘equipment of’’ or ‘‘equipment
constituting’’ the network. Further, the
Act makes clear that the range of
equipment implicated in the Section
must at least include ‘‘devices,’’ which,
in the telecommunications market, is
often a reference to end user devices,
rather than equipment used inside the
network to provide service to such
devices. Finally, whatever the scope of
the term ‘‘equipment,’’ such equipment
5 47
U.S.C. 1426(b)(2)(B).
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must be ‘‘built to open, non-proprietary,
commercially available standards.’’
In Section 6202, the Act describes the
components of the NPSBN itself,
including a core network and RAN, and
requires each to be based on
‘‘commercial standards.’’ 6 Thus, when
describing criteria for the equipment
with which the network itself is to be
constructed, the Act requires use of only
equipment built to commercial
standards, whereas in describing the
equipment of Section 6206(b)(2)(B), the
Act requires that such equipment must
be built not only to commercial
standards, but also ‘‘open, nonproprietary’’ standards.7 Therefore,
given the ‘‘for use on’’ language of the
provision, the distinct addition of the
terms ‘‘open, non-proprietary,’’ and the
separate section of the Act describing
and prescribing requirements for the
components of the network itself, it
appears that the equipment described in
Section 6206(b)(2)(B) refers to
equipment using the services of the
network, rather than equipment forming
elements of the NPSBN core network or
the RAN.
This interpretation is supported by
the other two elements appearing in
Section 6206(b)(2)(B). For example,
Section 6206(b)(2)(B)(ii) requires that
such equipment be ‘‘capable of being
used by any public safety entity,’’ which
would seem inconsistent with a
requirement applicable to complex
network routing and other equipment
used inside the network. Similarly,
Section 6206(b)(2)(B)(iii) requires such
equipment to be ‘‘backward-compatible
with existing commercial networks’’ in
certain circumstances, which would
again make sense in the context of end
user devices, but not equipment being
used to construct the network. This
interpretation is also consistent with
section 4.1.5.1, entitled ‘‘Device or UE,’’
of the Interoperability Board Report.8
6 See
id. § 1422(b).
§ 1422(b)(2). We interpret the terms
‘‘commercially available standards’’ and
‘‘commercial standards’’ as having the same
meaning as ‘‘commercial standards’’ defined in the
Act.
8 Section 6203 of the Act established the
Technical Advisory Board for First Responder
Interoperability (‘‘Interoperability Board’’) and
directed it to develop minimum technical
requirements to ensure the interoperability of the
NPSBN. 47 U.S.C. 1423. On May 22, 2012, the
Interoperability Board, in accordance with the Act,
submitted its recommendations to the FCC in a
report. See Interoperability Board, Recommended
Minimum Technical Requirements to Ensure
Nationwide Interoperability for the Nationwide
Public Safety Broadband Network (‘‘Interoperability
Board Report’’) (May 22, 2012), available at https://
apps.fcc.gov/ecfs/document/view?id=7021919873.
On June 21, 2012, the FCC completed its review of
the Interoperability Board’s final report and
approved it for transmittal to FirstNet. See FCC
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Thus, we preliminarily conclude that
Section 6206(b)(2)(B) applies to any
equipment, including end user devices,
used ‘‘on’’ (i.e., to use or access) the
network, but does not include any
equipment that is used to constitute the
network. Given the interoperability
goals of the Act and that end user
devices will need to operate seamlessly
across the network regardless of State
decisions to assume RAN
responsibilities, we also preliminarily
conclude that this provision applies
whether or not the equipment is to
access or use the NPSBN via a RAN in
a State that has chosen to assume
responsibility for RAN deployment.9 We
seek comments on these preliminary
conclusions, and on what if any
equipment, other than end user devices,
would fall under the scope of Section
6206(b)(2)(B) under this conclusion.
Having preliminarily concluded that
Section 6206(b)(2)(B) applies to end
user devices, we turn to the
requirements of this provision. Section
6206(b)(2)(B)(i) requires that all
equipment used to access the NPSBN
must be built to ‘‘open, non-proprietary,
commercially available standards.’’ 10
We seek comments on the scope of these
requirements, including in particular
the extent to which they impose
requirements beyond the minimum
requirements identified in the
Interoperability Board Report, and
whether they would preclude, for
example, proprietary operating systems
on devices. Such an expansive
interpretation could eliminate use of
commercial Long-Term Evolution
(‘‘LTE’’) devices used by public safety
entities today.
The Act, however, defines
‘‘commercial standards’’ as ‘‘technical
standards . . . for network, device, and
Internet Protocol connectivity.’’ 11 We
thus preliminarily conclude that the
Act’s goal of ‘‘promot[ing] competition
in the equipment market’’ would still be
served, as it is today in the commercial
market, by applying these requirements
to only those parameters necessary to
maintain interoperability with the
NPSBN—that is, ‘‘connectivity’’—and
which are included in the
Interoperability Board Report or
otherwise in FirstNet network policies.
We recognize that, for innovation to
Order of Transmittal, Recommendations of the
Technical Advisory Board for First Responder
Interoperability, PS Dkt. No. 12–74, FCC 12–68 (rel.
June 21, 2012), available at https://apps.fcc.gov/
edocs_public/attachmatch/FCC-12-68A1.pdf.
9 See infra Section II.B.ii. (further discussing the
term ‘‘network’’ as used in, for example, Section
6206(b)(2)).
10 47 U.S.C. 1426(b)(2)(B)(i).
11 Id. § 1401(10) (emphasis added).
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bring forth improved products for the
NPSBN, and for FirstNet and public
safety entities to benefit from
competition, product differentiation
must be allowed to thrive. However,
such differentiation must be balanced
with the interoperability goals of the
Act. Thus, certain network technical
attributes must be met by the equipment
under the terms of Section
6206(b)(2)(B), but other equipment
attributes may be left to individual
vendors to develop. We seek comments
on this preliminary conclusion and the
appropriate delineation between
attributes for ‘‘connectivity’’ and others.
Beyond the Act’s requirement that
equipment for use on the network
comply with specific types of standards,
Section 6206(b)(2)(B)(ii) requires that
the equipment be ‘‘capable of being
used by any public safety entity and by
multiple vendors across all public safety
broadband networks operating in the
700 MHz band.’’ First, the requirement
that the equipment be capable of being
used by any public safety entity would
appear to serve the cause of both
interoperability and competition in the
equipment market by ensuring the
largest market possible for such devices.
We seek comment on the limits of this
requirement, including whether use of
the word ‘‘capable’’ permits sufficient
flexibility for product differentiation by
public safety discipline or application.
For example, we preliminarily conclude
that this requirement would not
preclude devices primarily designed for
police applications so long as such
devices were technically capable of
being used by, for example, emergency
medical services.
Next, we examine the requirement
that such equipment be ‘‘capable of
being used . . . by multiple vendors.’’ 12
We seek comments on the distinction
between Congress’ use of the terms
‘‘used . . . by multiple vendors’’ and,
for example, if Congress had used the
terms ‘‘manufactured by multiple
vendors,’’ and whether this distinction
should be interpreted as requiring
devices that are at least capable of being
sold to public safety entities through
multiple suppliers who are not
themselves manufacturing the devices.
We seek comments on how this
requirement should be interpreted to
further the interoperability goals of the
Act.
The final phrase of the requirement—
‘‘across all public safety broadband
networks operating in the 700 MHz
band’’—could be interpreted to modify
just the vendor clause, but we
preliminarily conclude that, taken as a
12 Id.
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whole, it appears that Congress desired
both the public safety entity clause and
multiple vendor clause to be modified
by the phrase.13 We seek comments on
this preliminary conclusion. The term
700 MHz band is a defined term under
the Act, and includes not just the
frequencies licensed to FirstNet, but all
frequencies from 698 to 806
megahertz.14 Thus, we also seek
comments on the appropriate definition
of, and which ‘‘public safety broadband
networks’’ 15 other than FirstNet would
qualify under this clause, and note that
the Act contains a separate definition
for ‘‘narrowband spectrum.’’ 16
Finally, Section 6206(b)(2)(B) requires
equipment for use on the network to be
‘‘backward-compatible with existing
commercial networks to the extent that
such capabilities are necessary and
technically and economically
reasonable.’’ 17 Such backwards
compatibility could prove very valuable
for roaming and in the unlikely event
that FirstNet’s Band 14 network
encounters an outage. We seek
comments on the scope of the term
‘‘backward-compatible,’’ particularly
with respect to whether non-LTE
networks (including switched-voice
networks) are implicated, and the
criteria for determining whether such
capabilities are necessary and
technically and economically
reasonable.
B. FirstNet Network Policies
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i. Overview
Under Section 6206(b), FirstNet must
‘‘take all actions necessary to ensure the
building, deployment, and operation of
the [NPSBN].’’ 18 In addition to this
general charge, subsection (b) of Section
6206 itemizes a long list of specific
actions FirstNet must take in fulfilling
this obligation.
In the next subsection (c) of Section
6206, however, FirstNet is tasked with
establishing ‘‘network policies’’ in
carrying out these requirements of
subsection (b).19 In particular, under
subsection (c)(1), FirstNet must develop
the appropriate timetables, coverage
areas, and service levels for the requests
for proposals referenced in subsection
(b), along with four sets of policies
covering technical and operational
areas.20 In paragraph (2) of subsection
13 Id.
14 Id.
§ 1401(1) (defining 700 MHz band).
§ 1426(b)(2)(B)(ii) (emphasis added).
16 47 U.S.C. 1401(20) (defining narrowband
spectrum).
17 Id. § 1426(b)(2)(B)(iii).
18 Id. § 1426(b)(1).
19 See id. § 1426(c)(1).
20 See id.
15 Id.
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(c), FirstNet is required to consult with
State and local jurisdictions regarding
the distribution and expenditure of
amounts required to carry out the
network policies established in
paragraph (1).21
We explore these requirements below
considering the overall interoperability
goals of the Act. These network policies,
along with the Interoperability Board
Report, will form the fundamental basis
of such interoperability for public
safety, and thus their scope and
applicability must be clear to equipment
and device manufacturers, network
users, and any States that choose to
assume RAN responsibilities in their
States.
ii. Network Policies
Under Section 6206(c)(1), entitled
‘‘ESTABLISHMENT OF NETWORK
POLICIES,’’ FirstNet is required to
develop five groups of items, the first
being ‘‘requests for proposals with
appropriate’’ timetables, coverage areas,
service levels, performance criteria, and
similar matters.22 Unlike the remaining
four groups of items in paragraph (1),
this first group might not ordinarily be
thought of as the subject of a ‘‘policy’’
based on a plain language
interpretation. The title of the entire
paragraph, however, does reference
‘‘policies.’’ In addition, the consultation
required in paragraph (2) of subsection
(c) is with regard to the ‘‘policies
established in paragraph (1),’’ and
expressly includes topics such as
‘‘construction’’ and ‘‘coverage areas’’
that are the subject of the requests for
proposals listed in paragraph (1)(A).23
Thus, we preliminarily conclude that
the items listed in paragraph (1)(A) are
‘‘policies’’ for purposes of paragraph (2)
and as the term is generally used in
subsection (c).
In addition to the appropriate
timetables, coverage areas, and other
items related to the requests for
proposals in paragraph (1)(A), FirstNet
must develop policies regarding the
technical and operational requirements
of the network; practices, procedures,
and standards for the management and
operation of such network; terms of
service for the use of such network,
including billing practices; and ongoing
compliance reviews and monitoring.24
Taken as a whole, these policies,
including the elements of the requests
for proposals, form the blueprint and
operating parameters for the NPSBN.
Many of these policies will be informed
21 See
id. § 1426(c)(2)(A).
U.S.C. 1426(c)(1)(A).
23 See id. § 1426(c).
24 See id. § 1426(c)(1).
22 47
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by the partners chosen to help deploy
the network, and will likely change over
time, with increasing specificity as
FirstNet begins operations. Some of
these policies, such as those related to
the ‘‘technical and operational
requirements of the network,’’ will
prescribe how the FirstNet core network
and RAN will interconnect and operate
together, consistent with the
Interoperability Board Report. This
interaction is among the most important
‘‘technical and operational’’ aspects of
the network given the Act’s definition of
these terms and our preliminary
interpretations in the First Notice.25 For
example, this interaction would
determine how the FirstNet core
network implements authentication and
priority and preemption at the local
level, including the framework for such
authentication and prioritization
provided to local jurisdictions to enable
them to control important aspects of
such authentication and prioritization.
Other technical, operational, and
business parameters essential to the
nationwide interoperability of the
network will be determined by such
policies governing core network and
RAN interactions. This raises the
question as to whether and how
FirstNet’s policies developed under
subsection (1) apply to States that
assume responsibility for deployment of
the RAN in such States under Section
6302.
The Act does not expressly state
whether only FirstNet, or both FirstNet
and a State assuming RAN
responsibilities must follow the network
policies required under Section
6206(c)(1).26 Sections 6202 (defining the
NPSBN) and 6206 (establishing
FirstNet’s duties) only refer to the
‘‘nationwide public safety broadband
network’’ or the ‘‘network’’, without
expressly indicating whether such State
RANs are included in the term. We
preliminarily conclude below that,
given the provisions of the Act, the
25 79 FR 57059 (September 24, 2014) (discussing
elements of the network).
26 We preliminarily determined in our First
Notice that such State RANs must use the FirstNet
core network when service is provided to public
safety entities. We stated that this preliminary
conclusion, which is supported by the express
provisions in the Act and sections of the
Interoperability Board Report, was also ‘‘supported
by the overall interoperability goal of the Act,
which would, from a technical and operational
perspective, be more difficult to achieve if States
deployed their own, separate core networks to serve
public safety entities.’’ 79 FR 57059 (September 24,
2014). We received comments generally supporting
this conclusion overall, with some commenters
suggesting that we also provide a measure of
flexibility to States assuming RAN responsibility so
long as the interoperability goals of the Act were
achieved.
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Interoperability Board Report, and the
overall interoperability goals of the Act
and the effect on such interoperability
of not having the network policies of
Section 6206(c)(1) apply to opt-out
RANs, such policies must so apply to
ensure interoperability.
Section 6302(e), addressing the
process by which a State may submit a
plan to assume RAN deployment, states
that the alternative RAN plan must
demonstrate ‘‘interoperability with the
[NPSBN].’’ 27 This interoperability
demonstration is separate from a State’s
demonstration that it will comply with
the minimum technical interoperability
requirements of the Interoperability
Board Report, and thus must require a
demonstration of interoperability in
addition thereto. Similarly, Section
6302(e)(3)(D) requires such States to
demonstrate ‘‘the ability to maintain
ongoing interoperability with the
[NPSBN].’’ 28
A literal reading of these provisions
could be interpreted as indicating a
distinction between the NPSBN and
such State RANs, such that the policies
required by Section 6206, which apply
to the ‘‘nationwide public safety
broadband network’’ or ‘‘the network’’
could theoretically be interpreted as not
directly applying to such RANs. We
preliminarily conclude, however, that
such an interpretation reads too much
into the wording of Section 6302, which
could also be interpreted as requiring
the State RAN to interoperate with ‘‘the
rest of’’ the NPSBN.
The Act’s primary goal is the creation
of an interoperable network based upon
a ‘‘single, national network architecture
that evolves with technological
advancements’’ and is comprised of
both a core network and RAN.29 This
suggests that network policies
established by FirstNet pursuant to
Section 6206(c)(1) should apply to all
elements of the network, including
RANs built by individual States, to
ensure interoperability. In addition,
Congress did not differentiate between
opt-in and opt-out States in the
provisions of Section 6206(c)(2)
requiring consultation with States on
the policies of Section 6206(c)(1), and
such consultations would presumably
not be required for States assuming RAN
responsibility if the policies in question
(at least those applicable to RANs
following opt-out) did not apply to their
RAN deployment.
In the context of the Act, we thus
preliminarily conclude that an
important aspect of a State’s
27 See
47 U.S.C. 1442(e)(3)(C)(II).
§ 1442(e)(3)(D).
29 See id. § 1422(b).
28 Id.
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demonstrations of interoperability
under Section 6302(e)(3) would be a
commitment to adhering to FirstNet’s
interoperability policies implemented
under Section 6206(c) that are
applicable to NPSBN RANs. This could
be particularly important because such
policies will likely evolve over time as
the technology, capabilities, and
operations of the network evolve. An
alternative reading could result in
freezing in time the interoperability of
an opt-out State RAN contrary to the
goals of the Act. We seek comments on
these preliminary conclusions.
Notwithstanding these conclusions,
however, the policies established under
Section 6206(c) would, if not directly,
likely apply indirectly to a State seeking
to assume State RAN responsibilities.
As discussed above, such States must
demonstrate interoperability with the
NPSBN, and from a practical
perspective such interoperability will
largely depend, as is the case with
FirstNet’s deployed core networks and
RANs, on compliance with the network
policies of Section 6206(c)(1).30 In
addition, such States must also
demonstrate ‘‘comparable security,
coverage, and quality of service to that
of the [NPSBN].’’ 31 FirstNet’s policies
will establish requirements for such
security, coverage, and quality of service
standards for the NPSBN, and thus
States seeking to assume State RAN
responsibilities would, practically
speaking, need to demonstrate
‘‘comparable’’ capabilities to those
specified in these policies. The Federal
Communications Commission (‘‘FCC’’)
and NTIA will presumably use these
policies in making this comparison at
least at the point in time when a State
applies to assume RAN responsibilities.
Finally, given that FirstNet has a duty
to ensure the deployment and operation
of a ‘‘nationwide’’ public safety
broadband network, we preliminarily
conclude that, independent of the
interpretations discussed above,
FirstNet could require compliance with
30 It is important to note that Congress required
that a State RAN plan demonstrate to the FCC both
compliance with the Interoperability Board Report
and interoperability with the NPSBN, indicating
that the requirements of the Interoperability Report
are distinct from those further requirements that
may be necessary to interoperate with the NPSBN.
See 47 U.S.C. 1442(e)(3(C). The Interoperability
Board Report focused on ‘‘technical
interoperability,’’ noting that this term was more
limited than general network interoperability. See
Interoperability Board Report at 23. To establish
NPSBN interoperability therefore, we believe a
broader set of technical, business, and operational
standards must be developed pursuant to Section
6206(c)(1) and demonstrated by any State seeking
State RAN build and operation authority. Id.
§ 1426(c)(1).
31 Id. § 1442(e)(3)(D)(iii).
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network policies essential to the
deployment and interoperable operation
of the network for public safety in all
States as a condition of entering into a
spectrum capacity lease under Section
6302(e)(3)(C)(iii)(II).32 Accordingly, in
order to ensure the interoperability
goals of the Act and for the reasons
discussed above, we preliminarily
conclude that FirstNet’s network
policies will either directly or indirectly
apply to any State RAN deployment. We
note that FirstNet is subject to extensive
consultation requirements with States
regarding such policies under Section
6206(c)(2), and thus States will have
substantial opportunities to influence
such policies and, as is discussed more
fully below, FirstNet will want to work
cooperatively and over time with States
in their establishment. We seek
comments on these preliminary
conclusions.
C. A State’s Opportunity To Assume
Responsibility for Radio Access Network
Deployment and Operation
i. Overview of Statutory Provisions on
Deployment of State Networks
Section 6302(e) describes the process
for determining whether FirstNet or a
State will conduct the deployment of
the RAN within such State.33 As we
preliminarily concluded in the First
Notice, the Act requires FirstNet to
provide the core network in all States.34
The process for determining who will
deploy the RAN in a State requires
FirstNet to provide States with (a) notice
that FirstNet has completed its request
for proposal process for the construction
and operation of the nationwide
network, (b) details of FirstNet’s
proposed plan for buildout of the
NPSBN in such State, and (c) the
funding level, as determined by NTIA,
for such State.35 The Governor of a
State, after receiving the notice, must
then choose to either participate in the
deployment of the network as proposed
by FirstNet, or conduct its own
deployment of a RAN in such State.36
It is important to note that the
provisions of the Act, and the
interpretations discussed below, address
what is essentially the final or official
plan presented to a State. FirstNet
expects to work cooperatively, and in
keeping with its consultation
obligations, with each State in
32 Id.
§ 1442(e)(3)(C)(iii)(II).
id. § 1442(e).
34 79 FR 57059 (September 24, 2014) (describing
that the core network provides the primary control
layer of the network and connects the RAN to the
Internet and public switched network).
35 47 U.S.C. 1442(e)(1).
36 Id. § 1442(e)(2).
33 See
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developing its plan, including an
iterative approach to plans in order to
achieve both a State’s local and
FirstNet’s nationwide goals for the
NPSBN. Accordingly, none of the
discussions in this Second Notice
should be interpreted as implying a
unilateral or opaque approach to plan
development prior to the presentation of
the official ‘‘plan’’ reflected in the Act.
Following such a FirstNet plan
presentation, a decision by the Governor
to assume responsibility for deployment
of the State’s RAN sets in motion an
approval process for the State’s
alternative RAN deployment plan.37
The FCC must approve the plan.38 If this
alternative RAN plan is approved, the
State may apply to NTIA for a grant to
construct the RAN within the State and
must apply to NTIA to lease spectrum
capacity from FirstNet.39 Conversely, if
a State alternative plan is disapproved,
the RAN in that State will proceed in
accordance with FirstNet’s State plan.40
The Act is not entirely clear about the
economic and operational effects of an
approved alternative State plan. The
interpretations discussed below will
have substantial effects on the
operation, funding, and potentially the
viability of the FirstNet program.
Congress drew a balance between the
interoperability and self-sustainment
goals of the Act and preserving the
ability of States to make decisions
regarding the local implementation of
coverage, capacity, and many other
parameters if they wanted to exercise
such control. FirstNet has a duty to
implement the Act in a manner that is
faithful to this balance and to the
opportunity of States to exercise local
deployment control. But in balancing
the above interests, Congress was
careful not to jeopardize the overall
interoperability and self-sustainment
goals of the Act in its express
provisions. For example, a State’s ability
to exercise local control of deployment
is with respect to the RAN only, not the
core network, and the State must
demonstrate that its alternative plan for
the RAN maintains the overall goals of
the Act through, among other things,
demonstrating interoperability and costeffectiveness.
In the discussions below we continue
this balancing through our preliminary
interpretations of often complex
provisions. These interpretations are
preliminary, and they attempt to remain
faithful to the balance Congress appears
to have intended by affording States the
37 See
id. § 1442(e)(3).
id. § 1442(e)(3)(C).
39 See id. § 1442(e)(3)(C)(iii).
40 See id. § 1442(e)(3)(C)(iv).
38 See
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right to assume RAN responsibilities,
but not at the cost of jeopardizing the
interoperability and self-sustainment
goals of the Act on which public safety
entities and the overall program will
depend.
ii. FirstNet Presentation of a State Plan
FirstNet must present its plan for a
State to the Governor ‘‘[u]pon the
completion of the request for proposal
process conducted by FirstNet for the
construction, operation, maintenance,
and improvement of the [NPSBN]
. . . .’’ 41 The Act does not further
define when such process is
‘‘complete.’’ The process cited is
presumably the request for proposal
process detailed in subsections 6206(b)
and (c), which describe FirstNet’s duty
to develop and issue ‘‘requests for
proposals.’’ 42 Because Section 6206
speaks in terms of plural ‘‘requests for
proposals,’’ the ‘‘process’’ referenced in
subsection 6302(e) could be interpreted
to require completion of all such
requests for proposals, particularly
given that Section 6302(e) refers to the
request for proposal process for the
‘‘nationwide . . . network,’’ rather than
just a process for the State in question.
This would require the completion of
requests for proposals for all States prior
to any one State receiving a plan from
FirstNet.43
We tentatively conclude, however,
that it is reasonable to interpret
subsection 6302(e) to merely require
completion of the process for the State
in question, rather than the nation as a
whole, prior to presentation of the plan
to the State, assuming that FirstNet can
at that stage otherwise meet the
requirements for presenting a plan (and
its contents) to such State.44 First,
Section 6206 provides FirstNet with
flexibility in deciding how many and of
what type of requests for proposals to
develop and issue. This flexibility
inures to the benefit of public safety and
the States by allowing FirstNet to reflect
the input of regional, State, local, and
tribal jurisdictions under the required
consultations of Section 6206. If Section
6302 were read to require all States to
await the completion of all such
requests for proposals, FirstNet would
likely constrain the range of RFPs it
might otherwise conduct to avoid
substantial delays nationwide, and in
41 47
U.S.C. 1442(e).
id. § 1442(b)(1)(B), § 1442(b)(2).
43 We note that FirstNet is still in the process of
determining whether it will follow a single,
nationwide RFP process or regional, State, or other
multiple RFP processes.
44 See 47 U.S.C. 1442(e).
42 See
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doing so constrain its ability to reflect
the input from consultative parties.
Second, such a ‘‘wait for all’’
approach could, depending on how
such requests for proposals are issued,
nevertheless substantially delay
implementation of the network in many
or most States contrary to the Act’s
apparent emphasis ‘‘to speed
deployment of the network.’’ 45 For
example, if a protest or litigation
delayed proposals for one State or a
region, the entire network could be held
hostage by such litigation, creating
substantial incentives for
gamesmanship. Finally, if Congress had
wanted such an extreme result, we
believe it would have been more
explicit than the generalized reference
to ‘‘network’’ in subsection (e).46 Thus,
we preliminarily conclude that a State
plan can be presented to a State upon
the completion of the request for
proposal process only to the extent
necessary to develop such a plan for
such State. We seek comments on this
preliminary conclusion.
An additional question regarding the
interpretation of the term ‘‘completion’’
in subsection 6302(e) concerns the
specific stage of the request for proposal
process that constitutes such
‘‘completion.’’ The process prescribed
by the Act itself may impose a practical
limit on the extent of such completion.
Although we interpret the effects of a
State decision to assume RAN
deployment responsibilities in detail in
subsequent sections of this Second
Notice, for purposes of our discussion
here it is important to note that although
a Governor’s decision to assume RAN
responsibilities is on behalf of his or her
State, depending on the interpretations
discussed below, an individual State’s
decision could materially affect all other
States and thus the request for proposal
process.
For example, depending on such
interpretations, if a State chooses to
assume RAN responsibilities, it
potentially takes with it subscriber fees
and/or excess network capacity fees that
would have helped fund the FirstNet
network in all other States.47
Independent of funding issues, by
assuming RAN responsibilities the State
also reduces FirstNet’s costs, at least
with regard to the RAN, but also the
volume of purchase from a potential
vendor. The net amount of such reduced
funding and costs, and the impact to
economies of scale, determines whether
all other States will have a net reduction
45 Id.
§ 1426(b)(1)(C).
§ 1442(e).
47 See infra Section II.D.iii.
46 Id.
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in available funding and/or increased
costs due to the opt-out.48
Given this dynamic, the specific
States, and number thereof that choose
to assume RAN responsibilities will
affect, potentially materially, the final
awards in the request for proposal
process.49 The funding level in
particular will determine the amount
and quality of products and services
FirstNet can afford for public safety in
the request for proposal process to
construct the network. In addition, the
information on the specific and number
of opt-out States is an important factor
determining economies of scale and
scope represented by the FirstNet
opportunity to potential vendors (and
thus their pricing to and the
determination of costs for FirstNet).
Under the Act, however, FirstNet
must ‘‘complete’’ the request for
proposal process before presenting
plans to the States and obtaining this
important information. States will, of
course, want their plans to provide as
much specificity regarding FirstNet’s
coverage and services as possible, which
would ideally be determined on the
basis of the final outcomes of the
request for proposal process (which, as
is discussed above, ideally requires the
State opt-out decisions). Accordingly,
because of the circularity of these
information needs, FirstNet may not be
able to provide the level of certainty in
State plans that would ordinarily be
assumed to emerge from the final award
of a contract to a vendor to deploy in a
State. Thus, we preliminarily conclude
that ‘‘completion’’ of the request for
proposal process occurs at such time
that FirstNet has obtained sufficient
information to present the State plan
with the details required under the Act
for such plan, which we discuss below,
but not necessarily at any final award
stage of such a process. We seek
comments on this preliminary
conclusion.
iii. Content of a State Plan
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FirstNet must provide to the Governor
of each State, or a Governor’s designee,
‘‘details of the proposed plan for build
out of the [NPSBN] in such State.’’ 50
Section 6302 does not provide express
guidance as to what are the ‘‘details of
the proposed plan’’ that must be
48 We note that FirstNet will be able to impose a
user fee for use of the FirstNet core network by such
a State, which could make up for, among other
things, any added costs to integrate the State RAN
with the FirstNet core network.
49 From a timing standpoint, this holds true
during the pendency of such a State’s application
to assume RAN responsibilities even if such
application is ultimately unsuccessful.
50 47 U.S.C. 1442(e).
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provided. Other provisions of the Act,
however, provide some guidance in this
regard.
Because the plan details are to be
provided upon completion of the RFP
process, we can of course reasonably
conclude that such details are
contemplated to include outputs of such
process, as discussed in the previous
section of this Second Notice.51 Further,
Section 6206(c)(1)(A) requires that
FirstNet include in RFPs ‘‘appropriate’’
timetables for construction, coverage
areas, service levels, performance
criteria, and other ‘‘similar matters for
the construction and deployment of
such network.’’ 52 Therefore, it is
reasonable to conclude that Congress
expected that FirstNet would be able to
include at least certain outcomes of the
RFP process on such topics in a State
plan for the State in question. This is
particularly true with regard to
construction and deployment of the
RAN, regarding which the Governor
must make a decision in response to
being presented with the plan. We note
that Section 6302(e)(1)(B) states that the
details provided are for the buildout of
the network ‘‘in such State’’ only,
although FirstNet may choose to include
details of, for example, core
functionality that will be implemented
nationally or outside the State with
benefit to the State.
Other sections of the Act provide
further insight as to what should be
included in a State plan. A State that
seeks to assume responsibility for the
RAN in the State must present an
alternative plan to the FCC that
‘‘demonstrate[s] . . . interoperability
with the [NPSBN].’’ 53 Thus, the State
must at that point have knowledge of
how such interoperability can be
achieved, either through receipt of
FirstNet network policies or the FirstNet
plan for the State, or both. Further, in
order for a State to obtain grant funds
or spectrum capacity, it must
‘‘demonstrate . . . that the State has
. . . the ability to maintain ongoing
interoperability with the [NPSBN] . . .
and the ability to complete the project
within specified comparable timelines
specific to the State.’’ 54 Thus, for
example, implicitly the State must have
been presented with FirstNet timelines
with which NTIA may ‘‘compare’’ to the
State alternative plan.
In order to obtain grant funds or
spectrum capacity, a State must also
‘‘demonstrate . . . the cost-effectiveness
of the State plan . . . and . . .
51 See
supra Section II.C.ii.
47 U.S.C. 1422(c).
53 Id. § 1442(e)(3)(C)(ii).
54 Id. § 1442(e)(3)(D) (emphasis added).
52 See
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comparable security, coverage, and
quality of service to that of the
[NPSBN].’’ 55 Thus, similar to the
timelines discussed above, implicitly
the FirstNet plan (in combination with
FirstNet network policies) must provide
the State with sufficient information to
enable NTIA to make comparisons of
cost-effectiveness, security, coverage,
and quality of service. We seek
comments on the above preliminary
conclusions regarding the minimum
legally required contents of a FirstNet
plan for a State.56 Finally, as discussed
above, we preliminarily conclude that
certain limitations regarding plan
content are inherent in the plan process
prescribed by the Act.57
iv. Governor’s Role in the State Plan
Process
Section 6302(e)(2), entitled ‘‘State
decision,’’ is clear that ‘‘the Governor
shall choose’’ whether a State
participates in the FirstNet proposed
plan or conducts its own deployment of
a RAN in such State.58 Thus, we
preliminarily conclude that the decision
of the Governor in this regard will, for
purposes of the Act, be binding on all
jurisdictions within such State. For
example, if the Governor of a State
decides the State will participate in
FirstNet’s plan for buildout of the State,
a city or county within the State would
not be able to separately choose to
deploy a RAN.59 Aside from the clear
language of the Act regarding the
Governor’s role and decision, such subState level opt-out, if permitted, could
create potential islands of RANs which
do not meet the interoperability and
other similar goals of the Act, and
FirstNet would have to agree to use of
its spectrum in such cases. We note,
however, that FirstNet and a State could
agree that, as part of FirstNet’s plan,
FirstNet and the State (or sub-State
jurisdictions) could work together to
permit, for example, State
implementation of added RAN coverage,
capacity, or other network components
beyond the FirstNet plan to the extent
the interoperability, quality of service,
and other goals of the Act were met.
These further customizations of State
deployments over time may form an
important aspect of the FirstNet
implementation nationwide. These
additions have been raised in
55 Id.
§ 1442(e)(3)(D).
stated above, however, FirstNet may
provide more details than are legally required under
the Act.
57 See supra Section II.C.ii.
58 See 47 U.S.C. 1442(e)(2) (emphasis added).
59 We discuss certain post-State-decision aspects
of this issue in subsequent sections of this Second
Notice.
56 As
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consultation with state and local
jurisdictions and could improve the
network and provide additional
coverage. We seek comments on the
above preliminary conclusions. We also
seek comments, considering the
provisions of the Act and other
applicable law, on the effect of both, a
Governor’s decision to participate in
FirstNet’s plan for a State, and a
Governor’s decision to apply for and
assume RAN responsibilities in a State,
on tribal jurisdictions in such a State.
v. Timing and Nature of State Decision
Section 6302(e)(2) requires that the
Governor make a decision ‘‘[n]ot later
than 90 days after the date on which the
Governor of a State receives notice
under [Section 6302(e)(1)].’’ 60 This
phraseology raises the question as to
whether a Governor could make such a
decision prior to receiving such notice.
We preliminarily conclude that the
Governor must await such notice and
presentation of the FirstNet plan prior to
making the decision under Section
6302(e)(2). The language of Section
6302(e)(2) creates a 90-day period ‘‘after
the date’’ the notice is received, and the
decision is clearly designed to be
informed by the FirstNet plan.
In addition, any alternative
interpretation would not fit within the
process contemplated by the Act. Even
if a State were able to make a qualifying
decision prior to such notice, and we
preliminarily conclude it could not,
such a decision would trigger the 180day clock for submitting an alternative
plan to the FCC, discussed below.
Without a FirstNet plan having been
presented, the State’s premature
decision would not enable the FCC to
make the assessments required to
approve the State’s alternate plan, or if
such plan is approved, enable NTIA to
review and determine whether to grant
an application for grant funds and/or
spectrum capacity. For example,
without the FirstNet plan, a State would
not be able to demonstrate to the FCC
that its alternative RAN would be
interoperable with the yet-unspecified
FirstNet core network interconnection
points within the State. Nor would a
State be able to demonstrate
‘‘comparable’’ timelines, security,
coverage, or quality of service, as
required by Section 6302(e)(3)(D).61
Thus, the Governor’s premature
decision, prior to a FirstNet plan, would
likely be unworkable under the
requirements in the Act.62 We seek
60 47
U.S.C. 1442(e)(2).
§ 1442(e)(3)(D)(iii).
62 The Act’s requirement that a State be presented
a plan prior to rejecting it also ensures that each
61 Id.
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comments on this preliminary
conclusion.
vii. The Nature of FirstNet’s Proposed
State Plan
vi. Notification of State Decision
The Act does not require the Governor
of a State to provide notice of its
decision to participate in the FirstNet
proposed network under Section
6302(e)(2)(A) to FirstNet, or any other
parties. Rather, notice is only required,
as is discussed in detail below, should
the Governor of a State decide that the
State will assume responsibility for the
buildout and operation of the RAN in
the State.63 Thus, we preliminarily
conclude that a State decision to
participate in the FirstNet proposed
deployment of the network in such State
may be manifested by a State providing
either (1) actual notice in writing to
FirstNet within the 90-day 64 decision
period or (2) no notice within the 90day period established under Section
6302(e)(2). We seek comments on these
preliminary conclusions.
Read literally, the 90-day period
established under Section 6302(e)(2)
applies to the Governor’s decision,
rather than the notice of such decision,
which is addressed in Section
6302(e)(3). We preliminarily conclude,
however, that it is clear from the
language of Section 6302(e)(3) that the
notice is to be provided to FirstNet,
NTIA, and the FCC ‘‘[u]pon making a
decision . . . under paragraph
(2)(B).’’ 65 Thus, we interpret the
requirement to issue such notice as an
immediate (i.e. same day) requirement,
and that Congress did not intend to
apply an artificial deadline on the
Governor’s decision, and then permit an
indefinite period to lapse before
providing notice of such decision. Such
an indefinite period would run contrary
to the Act’s emphasis on the ‘‘speed of
deployment’’ of the network for public
safety.66 We seek comments on this
preliminary conclusion.
The Act describes what FirstNet is to
propose to each State as a ‘‘plan.’’ 67
Section 6302 describes a process for the
implementation of the nationwide
public safety broadband network in
each State.68 FirstNet’s presentation of a
plan to the Governor of each State for
buildout in that State and his/her
decision to participate in such buildout
as proposed by FirstNet or to deploy the
State’s own RAN are important steps of
this process. However, we preliminarily
conclude that FirstNet’s presentation of
a plan to a Governor and his/her
decision to either participate in
FirstNet’s deployment or follow the
necessary steps to build a State RAN, do
not constitute the necessary ‘‘offer and
acceptance’’ to create a contract.
Nowhere does the Act use words of
contract, such as ‘‘offer,’’ ‘‘execute,’’ or
‘‘acceptance’’ in relationship to the
FirstNet plan. For example, a Governor’s
decision is whether to ‘‘participate’’ in
the FirstNet plan. The Act provides the
Governor with 90 days to make a
decision once presented with the plan,
which would be an extremely short
period within which to negotiate a final
contract of this magnitude if a contract
were contemplated. Notwithstanding
this preliminary conclusion, a State
would, however, ultimately benefit from
any contractual remedies that FirstNet
can enforce against its contracting
parties for deployment of the network in
the State.
In addition, we believe this
interpretation is reasonable given that
establishing the plan as a contract
between FirstNet and a State would
likely be unrealistic in light of the
nature of the FirstNet program. For
example, as discussed above, the
process prescribed in the Act itself may
make contract-like promises at the plan
stage difficult.69 In addition, subscriber
adoption and fees will form an
important funding and self-sustaining
basis for FirstNet, dictating at least part
of the scope of its ongoing buildout,
features, and timing. These levels of
subscriber adoption and fees across the
network overall will not be known at
the State plan stage and will likely be
express assumptions thereunder.
Unlike the plan itself, however, when
public safety entities subscribe to
State has adequate information to determine
whether the State would receive a greater benefit
from either participating in the FirstNet proposed
network plan for such State or by conducting its
own deployment of the RAN in such State. More
specifically, the contents of the notice provided
under Section 6302(e)(1) will be necessary for a
State to make an informed decision as to whether
the State has the resources and capability to
demonstrate it can meet the minimum technical,
operational, funding, and interoperability
requirements described throughout Section 6302(e).
See 47 U.S.C. 1442(e).
63 See id. § 1442(e)(3).
64 In the absence of language to the contrary, we
interpret the days specified in the Act as calendar
days and seek any comments on this preliminary
interpretation.
65 47 U.S.C. 1442(e)(3).
66 See e.g., 47 U.S.C. 1426(b)(1)(C) (describing the
need for use of existing infrastructure to speed
deployment of the network); see also e.g., 47 U.S.C.
1426(b)(3) (encouraging FirstNet to seek cost
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effective opportunities to speed deployment in rural
areas).
67 A plan is defined as ‘‘a detailed proposal for
doing or achieving something.’’ Oxford
Dictionaries, available at https://www.oxford
dictionaries.com/us/definition/english/plan.
68 47 U.S.C. 1442(e).
69 See supra Section II.C.ii.
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FirstNet’s services, those subscription
agreements are expected to take the
form of contracts with FirstNet,
including contractual remedies in the
event FirstNet service does not meet
promised-for service levels. Similarly, to
the extent FirstNet enters into contracts
with State or local agencies for use of
local infrastructure, those contracts will
be negotiated and presumably contain
contractual remedies for both parties.70
We seek comments on the above
preliminary conclusions.
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viii. State Development of an
Alternative Plan
Section 6302(e)(3)(B) requires, not
later than 180 days 71 after a Governor
provides a notice under Section
6302(e)(3)(A), that the Governor develop
and complete requests for proposals for
construction, maintenance, and
operation of the RAN within the State.72
We believe the Act imposes this 180-day
period to ensure that the public safety
entities in and outside the State gain the
benefit of interoperable communications
in the State in a reasonable period of
time, either through the FirstNet plan or
a State plan.
Consistent with our preliminary
interpretation of the ‘‘completion’’ of
the FirstNet request for proposal
process,73 we preliminarily conclude
that the phrase ‘‘complete requests for
proposals’’ means that a State has
progressed in such process to the extent
necessary to present an alternative that
could demonstrate the technical and
interoperability requirements described
in Section 6302(e)(3)(C)(i).74 Like
FirstNet, States will potentially have
gaps in information at the time of their
request for proposal process, and
subsequently at the time of their
submission of an alternative plan. For
example, to the extent such States have
not negotiated at least the material
parameters of a spectrum capacity lease
agreement with FirstNet at the time of
an RFP, they will be unable to finally
determine the terms, which may be
materially affected by such parameters,
of any covered leasing agreement
(‘‘CLA’’) the State would enter into to
offset some or all their costs of
construction. Nor will NTIA have
potentially approved of such spectrum
capacity leasing rights at that point.
Thus, we encourage States that may
70 FirstNet is specifically authorized to make
contracts with Federal, State, regional, and local
agencies. See 47 U.S.C. 1426 (a)(3), (b)(4)(A).
71 In the absence of language to the contrary, we
interpret the days specified in the Act as calendar
days.
72 47 U.S.C. 1442(e)(3)(B).
73 See supra Section II.C.ii.
74 See 47 U.S.C. 1442(e)(3)(C)(i).
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contemplate such a process to engage
FirstNet as early as possible to increase
the specificity of the alternative plans
they can present to the FCC and NTIA.
In keeping with this interest in timely
network deployment, we preliminarily
conclude that where a State fails to
‘‘complete’’ its request for proposal
process in the 180-day period under the
Act, the State would forfeit its ability to
submit an alternative plan in
accordance with paragraph (e)(3)(C).75
This forfeiture would result in the
construction, maintenance, operations,
and improvements of the network
within the State proceeding in
accordance with the FirstNet plan. We
expect that the FCC will establish
procedures regarding the filing of
alternative State plans where States
have completed their requests for
proposal in a timely fashion. We seek
comments on these preliminary
conclusions.
ix. Responsibilities of FirstNet and a
State Upon a State Decision To Assume
Responsibility for the Construction and
Operation of Its Own RAN
Under Section 6302(e)(3)(C)(ii), States
with alternative plans approved by the
FCC may apply to NTIA for a grant to
construct a RAN within that state and
must apply to NTIA to lease spectrum
capacity from FirstNet.76 We
preliminarily conclude that approval by
the FCC of an alternative State plan
results in that State being solely
responsible for the construction,
operation, maintenance, and
improvement of the RAN in such State
in accordance with the State’s approved
plan, thereby extinguishing any
obligation of FirstNet to construct,
operate, maintain, or improve the RAN
in such State.77 Certainty as of the date
upon which the FCC approves or
disapproves the alternative plan is
important for FirstNet in determining
the final economics of its network and
business planning and thus its ability to
move forward, with vendors and
otherwise, in that and other States. We
seek comments on this preliminary
conclusion.
75 Id.
§ 1442(e)(3)(C).
§ 1442(e)(3)(C)(iii).
77 Such a State would, however, at a minimum
still require approval from NTIA for spectrum
capacity leasing rights and still fulfill their
contractual requirements of any spectrum capacity
lease negotiated with FirstNet. In addition to
FirstNet’s obligations under such a spectrum
capacity lease, FirstNet would also have to fulfill
its obligations, including any supervision
obligations, under FCC rules as the licensee of the
FirstNet spectrum with regard to any such State’s
use thereof.
76 Id.
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The Act, however, does not provide a
mechanism for a State, following an
FCC-approved State RAN plan, to
reinitiate an ‘‘opt-in’’ process where
FirstNet would assume the duty to build
the NPSBN in that State. For example,
if the sequence of events ended with a
State receiving approval of its
alternative plan by the FCC but being
unable to reach agreement on a
spectrum capacity lease with FirstNet or
being denied approval of such spectrum
capacity leasing rights or needed grant
funds by NTIA, the State subsequently
would be unable to operate the RAN in
the State. Although we intend to work
closely with the FCC, NTIA, and States
to try to anticipate and avoid any such
unnecessary process issues, we
preliminarily conclude that the inability
of a State to implement its alternative
plan for such reasons would not
preclude a State and FirstNet from
agreeing to allow FirstNet to implement
the RAN in such State. FirstNet’s duty
is the deployment of the network
nationwide, and deployment in all
States greatly benefits the nation as a
whole. As such, we do not believe
Congress intended to put such States in
limbo with regard to the NPSBN.
Further, because such uncertainty in
any one State would affect the benefits
of the NPSBN nationwide, we
preliminarily conclude that denial by
NTIA of at least the spectrum capacity
leasing rights would then permit
FirstNet to implement a plan in the
State.78 Absent this interpretation, any
one State could indefinitely delay,
among other things, construction of the
network in such State, the funding
derived from spectrum capacity leases
in such State, and the positive effects of
economies of scale and scope from
construction and operation in such
State, all to the detriment of all other
States and citizens through the effect on
the FirstNet program. In the absence of
express provisions under the Act, we
believe this preliminary interpretation
appropriately balances Congress’ intent
to have a nationwide network
implementation as soon as possible with
the rights of States to conduct their own
RAN deployment if, and only if, they
can meet the requirements under
Section 6302(e)(3). We seek comments
on this preliminary conclusion and any
alternative processes that meet the
requirements of the Act.
Beyond the above scenarios, if a State
initially enters into a spectrum capacity
lease with FirstNet and receives all
78 Following denial of the application for a
spectrum capacity lease in Section
6302(e)(3)(C)(iii)(II), FirstNet would remain the
licensee of the spectrum in question. See 47 U.S.C.
1442(e)(3)(C)(iii)(II).
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necessary approvals, because of
FirstNet’s authority to enter into
contracts with State and local agencies,
we preliminarily conclude that a State
may ultimately seek to have FirstNet,
assuming mutually acceptable terms,
take over some or all RAN
responsibilities in the State through a
contractual agreement.79 Given the
benefit to the nation of a functioning
network within all States, we believe
this capability is important in the event,
for example, that a State plan fails after
approval and execution of a spectrum
capacity lease. We seek comments on
these preliminary conclusions.
Finally, under Section
6302(e)(3)(C)(iv), if the FCC disapproves
an alternative State plan, the
construction, maintenance, operation,
and improvements of the radio access
network in that State will proceed in
accordance with the State plan
proposed by FirstNet.80 Thus, we
preliminarily conclude that once a plan
has been disapproved by the FCC,
subject only to the additional review
described in Section 6302(h), the
opportunity for a State to conduct its
own RAN deployment under Section
6302(e) will be forfeited, and FirstNet
may proceed in accordance with its
proposed plan for that State.81 This
certainty of obligation is important for
both FirstNet planning regarding selfsustainability and to ensure that the
network is built in a timely manner. We
seek comments on these preliminary
conclusions.
D. Customer, Operational and Funding
Considerations Regarding State
Assumption of RAN Construction and
Operation
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i. Overview
Having discussed above many of the
procedural aspects of a State’s decision
to assume RAN responsibilities, we turn
to some of the potential substantive
ramifications of such a decision.
Importantly, and as is also discussed
above, these ramifications can reach
beyond the borders of the State making
the decision. They include potential
effects in and outside the State on
public safety customers, FirstNet’s costs
and available funding nationally,
including its ability to meet substantial
rural milestones, and the purchasing
79 How such an agreement or the circumstances
giving rise to the agreement, if permitted, would be
treated by the FCC or NTIA under Section
6302(e)(3) would depend on such decisions, rules,
or regulations of the FCC or on NTIA’s decisions.
See 47 U.S.C. 1442(e)(3).
80 47 U.S.C. 1442(e)(3)(C)(iv).
81 Id. § 1442(h) (describing the jurisdiction and
standard of review for reviewing the disapproval of
a plan by the FCC).
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power of FirstNet on behalf of public
safety. In addition to these critical
considerations, in order to achieve the
goals of the Act following a State
decision to assume RAN
responsibilities, FirstNet and such a
State must in all cases define and
implement a potentially complex
operational relationship to serve public
safety.
In arriving at the preliminary
interpretations below, we endeavored to
remain faithful to the balance Congress
struck between the deployment of a
nationwide network as soon as
practicable, and the right of States to
deploy their own RAN under the
conditions outlined in the Act. The
most difficult of these preliminary
interpretations relate to areas where the
Act is either completely silent or
provides only inferential guidance.
These include topics such as who
actually provides service to public
safety entities in opt-out States, who
receives and may use fees from such
services and for what purposes, and
whether Congress intended the right to
opt-out under the Act to include,
particularly with respect to fees for use
of excess network capacity, the right to
fundamentally affect the complex
funding structure of the FirstNet
program in all other States in favor of
the State opting out.
We discuss below preliminary
conclusions regarding these issues, but
expect the highly complex legal and
operational landscape in these areas to
also mature over time, particularly in
light of FirstNet consultations,
including most importantly the
comments received from this Second
Notice.
ii. Customer Relationships in States
Assuming RAN Construction and
Operation
The Act does not expressly define
which customer-facing roles are
assumed by a State or FirstNet with
respect to public safety entities in States
that have assumed responsibility for
RAN construction and operation.
Generally speaking all wireless network
services to public safety entities will
require technical operation of both the
RAN, operated by the State in this case,
and the core network, operated by
FirstNet in all cases as we preliminarily
concluded in the First Notice.82 We
received predominantly supportive
comments in response to this
preliminary conclusion in the First
Notice, with some commenters
suggesting flexibility, on a State-by-State
basis, in the precise delineation of
82 See
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13345
technical and operational functions
performed by the FirstNet core network
and States assuming RAN
responsibilities in such States.83 A core
network, for example, would typically
control critical authentication, mobility,
routing, security, prioritization rules,
and support system functions, including
billing and device services, along with
connectivity to the Internet and public
switched network. The RAN, however,
would typically dictate, among other
things, the coverage and capacity of last
mile wireless communication to
customer devices and certain priority
and preemption enforcement points at
the wireless interface of the network.
Either alone is an incomplete network
and each must work seamlessly with the
other. As a result, FirstNet and such
States must similarly work together to
ensure that public safety is provided the
critical wireless services contemplated
by the Act.
These technical and operational
functions and interactions between the
RAN and core network, however, can
vary to a limited extent that would not
necessarily jeopardize the
interoperability goals of the Act.
FirstNet preliminarily concludes that it
will maintain a flexible approach,
advocated by some States in their
comments to the First Notice, to such
functions and interactions in order to
provide the best solutions to each State
so long as the interoperability and selfsustainment goals of the Act are
achieved.84 The allocation of such
technical and operational functions,
83 See, e.g., Comments of the State of Florida at
3–4 (stating ‘‘Florida acknowledges that the Act
requires FirstNet to build the core network. The
Act, does not however, prohibit any other party
from building and operating a core network, as long
as it meets the interoperability and operational
standards promulgated by FirstNet. Florida
encourages FirstNet to remain flexible when
creating its network architecture to provide options
for the various States to best meet their broadband
needs in support of their public safety missions.’’)
available at https://www.regulations.gov/#!document
Detail;D=NTIA-2014-0001-0013; See also, e.g.,
Consolidated Response of the MACINAC Initiative
to the Request for Information For Comprehensive
Network Solution(s) and Public Notice and
Comment Request for Comments at 8 (stating
‘‘MACINAC is not interested in operating a core,
nor is it advocating for State-run cores; instead we
are suggesting that when considering the line of
demarcation between RAN and core, FirstNet must
be careful to respect the distinction between
technology [the hardware, software, and standards]
and the policy and operation of the core services.
Public safety entities will be unlikely to support the
network unless FirstNet provides States and local
governments the means to control and manage
services such as billing, location, and device
services.’’) available at https://www.regulations.gov/
#!documentDetail;D=NTIA-2014-0001-0008.
84 FirstNet is continuing to review comments in
response to the preliminary conclusions in its First
Notice and makes no final determinations with
respect thereto in this Second Notice.
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however, does not entirely dictate who
assumes public safety customer-facing
roles, such as marketing, execution of
customer agreements, billing,
maintaining service responsibility, and
generating and using fees from public
safety customers. States assuming RAN
responsibilities could, for example,
operate as partial resellers or enter into
Mobile Virtual Network Operator
(‘‘MVNO’’)-like arrangements 85 with
FirstNet to use part or all of its core
network to offer service to public safety
entities in a State. Alternatively, such
States could act as a RAN supplier to
FirstNet, customizing the RAN to local
needs but placing the responsibility
with FirstNet to market, serve, and bill
public safety entities in the State. There
are a variety of such possible
arrangements, and we preliminarily
conclude below that the Act provides
sufficient flexibility to accommodate
many of them so long as the
interoperability and self-sustainment
goals of the Act are met.
We first note, as we preliminarily
concluded in the First Notice, that the
State decision is as to whether to control
deployment of the RAN, not the core
network, and as is discussed above, the
RAN alone is insufficient to offer
wireless service. Under Section 6302(f),
FirstNet is authorized to charge States
assuming such RAN responsibilities
user fees for ‘‘use of elements of the core
network.’’ 86 This clause could be
interpreted as evidence of Congress’
contemplation of such a State’s use of
the FirstNet core network to provide
service to public safety entities in a
resale or MVNO-like arrangement. But
there are a variety of circumstances,
other than providing end user services,
under which a State may want to use
elements of the FirstNet core network.
For example, the FirstNet core network
would have to be used to enable RAN
sharing as specified by the
Interoperability Board Report in
connection with a CLA between the
State and a third party. In addition, if
the State itself subscribed to FirstNet
services, because the State is
responsible for the RAN, the State and
FirstNet would have to negotiate an
agreement addressing, among other
things, State use of the core network.
Thus, this clause alone does not,
generally speaking, appear to indicate
one way or another who is to be the
customer-facing service provider in a
State that has assumed RAN
85 In a traditional MVNO relationship, a mobile
operator supplies the RAN and some components
of the core network to the MVNO.
86 47 U.S.C. 1442(f).
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responsibility and could provide
flexibility in this regard.
Similarly, Section 6302(e)(3)(D)
indicates that such a State is to ‘‘operate
. . . the State radio access network’’ and
‘‘maintain ongoing interoperability with
the [NPSBN].’’ 87 Neither of these
requirements necessarily indicates a
customer-facing role. The State is
expressly operating the RAN, not the
NPSBN as a whole in the State. Thus,
these clauses similarly do not appear to
be restrictive in this regard.
The Act requires that States seeking to
obtain grant funds or spectrum capacity
leasing rights must demonstrate
‘‘comparable . . . quality of service to
that of [FirstNet].’’ 88 This provision
implies that States building and
operating a RAN are at least providing
a ‘‘quality of service’’ to someone. For
example, the clause could mean that
because the RAN is part of the network
that FirstNet is using to provide service
to a public safety customer, the State
must demonstrate that this ultimate
level of service from FirstNet will not be
diminished relative to what FirstNet
would provide under its plan.
Alternatively, the provision could be
interpreted as contemplating a State
providing a quality of service to end
user customers. Again, this clause does
not appear to clearly require one or the
other customer-facing roles.
Another important provision relevant
to this determination precludes States
that assume RAN responsibility from
‘‘provide[ing] commercial service to
consumers or offer[ing] wholesale
leasing capacity of the network within
the State except directly through publicprivate partnerships for construction,
maintenance, operation, and
improvement of the network within the
State.’’ 89 This provision could imply
that such States are otherwise
contemplated to provide commercial
services to non-consumers (e.g., public
safety entities) within that State. This
interpretation, however, based on
implication, is not required by the
provision, which could merely be
formulated to avoid precluding the
intended use of the State RAN for
service provision by FirstNet to public
safety. The implication may support the
flexibility discussed above, although
Congress was express and overt
elsewhere in the Act in authorizing a
customer-facing relationship.90
87 Id.
§ 1442(e)(3)(D).
§ 1442(e)(3)(D)(iii).
89 Id. § 1442(g)(1).
90 We note that Section 6212 separately precludes
FirstNet from providing services directly to
consumers, and such a prohibition would
presumably cover FirstNet’s offer of services in a
State that has assumed responsibility for a RAN,
88 Id.
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Section 6208 and Section 6302
expressly authorize FirstNet and a State
assuming RAN responsibilities,
respectively, to enter into CLAs.91 Only
Section 6208, however, which
authorizes ‘‘[FirstNet] . . . to assess and
collect . . . fees,’’ identifies ‘‘user or
subscription fee[s] . . . including . . .
from . . . any public safety
entit[ies].’’ 92 That is, Congress expressly
authorized both FirstNet and States to
enter into CLAs, but only expressly
provided for FirstNet to charge public
safety entities for user or subscription
fees. Because Congress took the step of
expressly authorizing the State to
exploit federally-licensed spectrum
using one method (public private
partnerships (‘‘PPPs’’)/CLAs), and,
unlike FirstNet, not another (subscriber
fees), a potential interpretation of the
Act with respect to these provisions is
that FirstNet is intended to be the
customer-facing service provider for
public safety entities in States that
assume RAN responsibilities, or is at
least the only entity permitted to assess
subscription fees to public safety
entities. Such an interpretation would
also be supported by the existence of
provisions under the Act, more fully
discussed below, requiring FirstNet to
reinvest subscriber fees as well as excess
network capacity fees into the network,
whereas the only reinvestment
provision expressly applicable to States
assuming RAN responsibilities concerns
excess network capacity fees. This too
could indicate that such States, as RAN
providers, were not intended to assess
subscription fees because if they were
intended to do so, Congress would have
required their reinvestment into the
network (as they did with State CLA
fees).93
We preliminarily conclude, however,
that although the above provisions
could indicate a Congressional intent to
have FirstNet be the primary customerfacing entity at least with regard to the
fees assessed public safety entities, a
reasonable interpretation of all the
raising the question as to why the preclusion of
Section 6302 is necessary unless Congress assumed
such States were customer-facing to public safety
entities. See 47 U.S.C. 1432, § 1442. Because
Congress permitted such States to enter into
agreements to exploit the excess network capacity
in such States, the Section 6302 provision serves to
limit the type of such agreements to the specified
PPPs. Id. § 1442(g). Without this provision, States
could enter into agreements to exploit excess
capacity where the paying party was not aiding in
the ‘‘construction, maintenance, operation, and
improvement of the network.’’ Id. § 1442(g). Thus,
the provision can serve a separate purpose.
91 Id. § 1428(b), § 1442(e)(3)(c)(i)(II).
92 See id. § 1428.
93 47 U.S.C. 1442(g)(2) (requiring revenues gained
by a State from such a leasing agreement to be
reinvested in the network).
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provisions discussed above, including
both operational and fee-related, would
not preclude opt-out States, as sovereign
entities, from charging subscription fees
to public safety entities if FirstNet and
such States agreed to such an
arrangement in the spectrum capacity
lease with the States, and the
arrangement was part of an alternative
plan approved by the FCC and NTIA.
We seek comments on this preliminary
conclusion.
In addition to affording flexibility
with respect to FirstNet’s role, because
of the lack of definitive language in the
Act discussed above, we also
preliminarily conclude that the Act does
not require that such States be the
customer-facing entity entering into
agreements with and charging fees to
public safety entities in such States. In
particular, our conclusion is based on
the absence of provisions in the Act
requiring such a result, as discussed
above, and the inclusion of provisions,
such as those regarding the assessment
and reinvestment of subscriber fees, that
at least clearly authorize, if not
contemplate the opposite result.
Accordingly, we preliminarily
conclude that the Act provides
sufficient flexibility, as discussed above,
to allow the determination of whether
FirstNet or a State plays a customerfacing role to public safety in a State
assuming RAN responsibilities to be the
subject of operational discussions
between FirstNet and such a State in
negotiating the terms of the spectrum
capacity lease for such State, in addition
to the approval of the State’s alternative
plan by the FCC and spectrum leasing
rights and any grant funds by NTIA. We
seek comments on these preliminary
conclusions.
Our preliminary interpretations above
attempt to maintain the balance
between, on the one hand, construction
of a nationwide architecture and
interoperable operation of the network,
and on the other hand, a State’s
opportunity to design and deploy a RAN
that meets the particular coverage,
capacity, and other needs of the State.
Our interpretations leave room for the
flexibility advocated by some States in
response to our First Notice in order to
provide the best solutions in each State
while adhering to the goals of the Act.
However, under all these possible
scenarios—where an opt-out State or
FirstNet is playing customer-facing
service provider roles to public safety
entities—the splitting of responsibilities
for the network at the interface between
the RAN and core network will present
substantial operational complexities. A
resale or MVNO-like arrangement
permitting States that assume RAN
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responsibilities to offer service to public
safety entities could create disparities
in, among other things, terms and
conditions, service/feature offerings and
availability, priority and preemption
governance schemes, and pricing and
billing practices between opt-out States
and opt-in States. These disparities, in
addition to jeopardizing
interoperability, could also reduce
subscription to and use of the NPSBN
by adding complexity, implementation
risk, and confusion among public safety
entities. Although some of these
disparities could be addressed in the
opt-out process and network policies
implemented by FirstNet, and/or
mitigated in agreements between
FirstNet and opt-out States, such a
structure could be inconsistent with the
goals of the Act to establish ‘‘a
nationwide, interoperable public safety
broadband network . . . based on a
single, national network
architecture.’’ 94
FirstNet’s customer-facing role in
providing services to public safety
entities in opt-out States, although
potentially mitigating many of the above
difficulties, would present different
issues, such as RAN coverage and
capacity planning, investment, and
reimbursement debates between
FirstNet and such States.95 Under the
variety of possible scenarios enabled by
commercial network standards, FirstNet
and States assuming RAN
responsibilities will have to work
together over many years with the best
interests of public safety in mind to
address myriad operational issues.96
94 Id. § 1422(b). There is also no indication in the
Act that the State option to assume RAN
responsibilities was enacted to promote
competition between FirstNet and such States.
95 We also note that States are not restricted from
using their own funds to build and operate the
RAN, nor are they required to apply to NTIA for
funding.
96 For example, if FirstNet is the public safety
customer-facing provider, how will future capacity
and coverage expansion of the RAN be handled
between the parties given that FirstNet sales and
service projections will be driving such
investments? Alternatively, if the State is the public
safety customer-facing provider and wants to
expand the RAN or services beyond FirstNet’s
current core configuration, how will those
arrangements be handled? How will roaming
agreements between FirstNet and the State, and
between either FirstNet or the State (as the service
provider) and other carriers be handled? Regardless
of the service provider model in States assuming
RAN responsibilities, how will radio frequency
planning be accomplished on State borders? We
therefore also seek comments on the operational
parameters implicated in the shared service
provision models discussed above.
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13347
iii. State Use and Reinvestment of
Funds Received From Building and
Operating a RAN
FirstNet has three primary sources of
funding: (1) Up to $7 billion in cash; (2)
subscriber fees; and (3) fees from excess
network capacity leases (known as
CLAs) that allow FirstNet to sell
capacity not being used by public safety
to commercial entities.97 Each of these
funding sources is critical to offset the
massive costs of the nationwide
broadband wireless network envisioned
in the Act and the self-sustainability
required of FirstNet under the Act.
State opt-out decisions could,
however, depending on the
interpretations below, materially affect
FirstNet’s funding and thus its ability to
serve public safety, particularly in rural
States. If a State receives approval to
opt-out it could theoretically tap into or
entirely supplant each of the three
primary FirstNet funding sources within
the boundaries of the State. More
precisely, depending on such
interpretations, a State that assumes
RAN responsibility could tap into or
supplant these funding sources in an
amount that materially exceeds the
amount of resources FirstNet (or a
reasonable State plan) would have
allocated to serve that State.98
For example, once a State receives
approval of its alternative RAN plan
from the FCC, the State must apply to
NTIA for a spectrum capacity lease from
FirstNet.99 Section 6302(g) then permits
a State to enter into CLAs, using the
spectrum capacity leased from FirstNet
to offset the costs of the RAN. The Act
does not specify the terms governing the
lease nor the amount of spectrum
capacity for which a State may apply,
only requiring any fees gained to be
reinvested into the RAN ‘‘of the
State.’’ 100 Assuming for the moment
that such a State receives all necessary
approvals and enters into a lease with
FirstNet for use of all of FirstNet’s
spectrum capacity in the State, and such
a State is the billing service provider to
public safety entities in the State, then
all public safety subscriber and excess
network capacity fees generated in the
State would go to and remain in the
97 See
generally 47 U.S.C. 1428, § 1457.
used here, resources would be the amounts
from all fees (including subscriber and excess
network capacity) used to cover costs in the State.
In an opt-out scenario, FirstNet would avoid the
costs of the RAN, gain core network fees, but
potentially lose fees that would have exceeded its
costs in the State, as discussed herein. FirstNet’s
purchasing power with vendors would also decline
to the extent of the RAN-related purchases, thereby
potentially raising FirstNet’s costs to the extent of
such reduced purchasing power.
99 47 U.S.C. 1442(e)(3)(C).
100 Id. § 1442(g)(2).
98 As
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State other than any core network fees
assessed by FirstNet.
Generally speaking, States with highdensity populations may generate
subscriber and/or excess network
capacity fees for FirstNet that materially
exceed their RAN costs to FirstNet.
Thus, if such a State opts out of the
FirstNet plan, and the Act is interpreted
to allow such States to keep any or all
of the fees from such States that exceed
RAN costs within the State (assuming
even an expanded RAN in the State
alternative plan relative to FirstNet’s
plan), then funding for all other States
could decline because FirstNet will not
receive the funding for use outside the
State.101 That is, because FirstNet must
aggregate fee amounts across all States
for reinvestment and use by all
States,102 if a State is able to withhold
fees materially in excess of those
FirstNet was going to allocate to the
State (beyond the avoided cost of the
RAN and core network fees, and
accounting for any plan differences
between FirstNet and the State), funding
for all other States would materially
decline. This circumstance could have a
detrimental impact on both the funds
available to maintain and improve the
NPSBN on an ongoing basis as well as
adversely affect the cost of services to
public safety users.
Thus, if a State believes it can
generate and withhold such fees for its
own use under the Act, it may have at
least a theoretical economic incentive to
opt-out. Again assuming the Act is
interpreted this way, our preliminary
estimates indicate that very high density
States may have such an incentive,
although only the request for proposal
processes and actual operations will
determine this for certain. Accordingly,
if the Act is interpreted in this manner,
it has a built in incentive structure for
a few States to opt-out and retain, for
reinvestment or otherwise in such
States, fees that could materially reduce
FirstNet coverage and services in all
other States, including States with more
rural areas.
We believe as a general matter that
Congress did not intend for a few, highdensity States to be able to withhold
material funding for all other States
under the Act. Such an incentive
structure, even if reinvestment in the
State network were always required in
opt-out States, could result in networks
that greatly exceed public safety
requirements in a few opt-out States (or
funds diverted to State general funds),
101 Funding for that opt-out State’s core network
would also decline, but FirstNet would be able to
assess such a State core network fees under the Act.
102 See 47 U.S.C. 1428.
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and networks that do not meet public
safety requirements and the goals of the
Act in the vast majority of States.
Nothing in the Act indicates that such
a result was contemplated, particularly
given FirstNet’s duty to ensure the
deployment of a ‘‘nationwide’’ network
that includes ‘‘substantial rural coverage
milestones as part of each phase of the
construction and deployment of the
network.’’ 103 We do not believe this was
the balance Congress intended to strike
between establishing a nationwide
network and providing States an
opportunity, under certain conditions,
to customize and operate the RAN
portion of the network in their States.
Congress’ intent in this regard is
informed by, among others, the
provision in Section 6302(e)(3)(D) that
requires that a State wishing to assume
RAN responsibilities demonstrate ‘‘the
cost-effectiveness of the State plan’’
when applying to NTIA not just for
grant funds, but also for spectrum
capacity leasing rights from FirstNet,
which are necessary for the
implementation of a State RAN and
could exceed the value of any grant
funds over the life of the program.104
Independent of NTIA’s determination in
assessing such an application, FirstNet,
as the licensee of the spectrum and an
independent entity within NTIA, must
ultimately decide to enter into such a
lease, and thus we analyze this
provision in considering FirstNet’s role
and duties in relation to the State’s
proposed demonstration of the plan’s
‘‘cost-effectiveness.’’ 105
If a State presented a plan for a RAN
deployment identical to FirstNet’s but
costing three times as much, a
reasonable interpretation of this
provision would indicate that if
material, the amount in question would
render such a plan not cost-effective
(assuming the State was not using its
own funds or otherwise compensating
for the cost difference). Two times the
cost of the RAN would be wasted for the
rest of the country. This straight-forward
103 Id.
§ 1426(b)(1), (3).
id. § 1442(e)(3)(D).
105 We note that FirstNet’s interpretation of this
provision and its determination with regard to its
duties based on the State’s proposed demonstration
is independent of and does not limit NTIA. To the
extent the ‘‘spectrum capacity lease’’ described in
Section 6302(e)(3)(C)(iii)(II) is a lease of the
spectrum itself, rather than capacity on the
network, under applicable FCC rules the FCC ‘‘will
allow parties to determine precise terms and
provisions of their contract’’ consistent with
FirstNet’s obligations as a licensee under such
rules. See Promoting Efficient Use of Spectrum
Through Elimination of Barriers to the Development
of Secondary Markets, WT Docket No. 00–230,
Report and Order and Further Notice of Proposed
Rulemaking, FCC 03–113, 18 FCC Rcd 20604, 20637
(2003).
104 See
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analysis of cost-effectiveness implicitly
takes into account funding on a national
basis, beyond the border of the State in
question, because the State itself would
receive the same RAN and the costinefficiency would only affect other
States through FirstNet. Thus, by
including a cost-effectiveness test, a
straight-forward interpretation of the
provision would indicate Congress’
intent that State opt-out decisions do
not unreasonably affect the resources of
the network as a whole, or at the very
least that such decisions only allocate
resources to provide different or greater
RAN coverage in a reasonable
manner.106
In the case of a high-density State or
territory, such as the District of
Columbia, the value of public safety
user fees and CLAs is likely much
greater than a high-quality network’s
costs. That is, the effective cost of the
RAN once subscriber and/or excess
network capacity lease fees are taken
into account is zero, and surplus fees
are generated. Assuming for the moment
that the State could generate the same
(surplus) CLA fees that FirstNet could in
the State, if the State were to present a
plan that withheld such surpluses in the
State itself, by analogy to the previous
example, the rest of the States would be
denied the benefits to the NPSBN
afforded by the availability of such
amounts to reduce the overall cost of
services. Even if such a surplus were
reinvested in the State’s network,
spending the surplus on only the
network in that State may greatly exceed
the reasonable needs of public safety in
the State relative to those in other
States. In addition to this inefficiency, if
the Act were interpreted not to require
reinvestment (discussed below) then
any surplus fees diverted to State
general funds would be drained from
the FirstNet program and public safety
in all States, including the opt-out State.
Exacerbating this effect, a single State
(or even a group of States) negotiating a
CLA for only such a State (or group)
could yield substantially lower fees
overall relative to what FirstNet would
have generated. In the example above,
the District of Columbia alone would
likely generate lower fees than FirstNet
would for the spectrum in the District
because FirstNet would likely enter into
a CLA that spanned the entire metro
area of Washington, DC, including parts
of Maryland and Virginia that, from a
106 The actual analysis would presumably include
any added benefits provided by differences in the
State RAN plan, which could justifiably cost more
than the FirstNet RAN plan. But material fees
captured in the State beyond the cost of even a
reasonably enhanced RAN plan could result in
inefficiencies.
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commercial carrier’s perspective, are
important to the value of the spectrum
in the District. Furthermore, FirstNet’s
request for proposal process might
reveal that a regional or national CLA
would generate even greater fees
attributable to the District (and the
District with surrounding States)
because of the seamless spectrum
footprint across the region or nation. Of
course, the opposite could also be true,
that for some reason a State or group of
States may be able to generate more fees
from a CLA than FirstNet which,
depending on the allocation of such fees
between the State and FirstNet, could
benefit all other States relative to the
agreement into which FirstNet would
have entered. These are important
considerations materially affecting the
value of the assets Congress provided to
fund the program.
Accordingly, as a threshold matter,
with respect to FirstNet’s negotiation of
a spectrum capacity lease with States
seeking to assume RAN responsibilities,
we preliminarily conclude that Congress
did not intend such leases to enable
materially cost-inefficient RAN plans or,
more precisely, materially inefficient
use of the scarce spectrum resources
provided to the program, and it would
be FirstNet’s duty to consider the effect
of any such material inefficiencies on,
among other things, more rural States
and on the FirstNet program in
determining whether and under what
terms to enter into such a lease.
The Act directs States with approved
alternative RAN plans to ‘‘apply’’ to
‘‘NTIA to lease spectrum capacity from
[FirstNet].’’ 107 It does not guarantee that
NTIA will approve spectrum capacity
leasing rights for a State, but rather sets
out criteria that must be demonstrated
to NTIA—including the costeffectiveness of the plan—prior to
receiving approval. FirstNet, however,
as an independent authority within
NTIA and as the licensee of the
spectrum, has a duty to preserve the
meaningful right of States to opt-out
under the Act, but also additional duties
imposed by the Act to ensure the
deployment of the network nationwide
and duties imposed by FCC rules as a
licensee with respect to the spectrum
and any capacity subleases thereof. We
preliminarily conclude that FirstNet, in
the exercise of such duties, can and
must take into account, among other
things, the considerations discussed
above in whether and under what terms
to enter into a spectrum capacity lease
107 47
U.S.C. 1442(e)(3)(iii)(II).
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with a State. We seek comments on this
preliminary conclusion.108
FirstNet’s proposed approach,
however, would not result in a binary
FirstNet position. FirstNet, in remaining
faithful to the balance Congress struck
in the Act, would work with States
desiring to assume RAN responsibilities
to evaluate potential ‘‘win-win’’
arrangements where the assets Congress
provided are used efficiently but the
right of States to assume RAN
responsibilities under the Act’s criteria
is preserved. For example, FirstNet and
such a State could agree, as part of the
spectrum capacity lease and ultimately
as part of the State’s alternative plan
presented to the FCC and NTIA, to
leverage a FirstNet CLA if it presents a
materially better fee return to the benefit
of both the State in question and all
other States. Such a State could become
a contracting party with the same
covered leasing partner, giving the State
control of and responsibility for the
RAN. If, taking into account the abovediscussed potential effects on the
program, a State is nevertheless able to
enter into a more favorable CLA with a
different covered leasing partner, then
FirstNet and the State could agree on
how such an agreement would benefit
the State and the network as a whole. A
variety of approaches could achieve
‘‘win-win’’ solutions, and FirstNet
would be committed to exploring them
within the bounds of the Act. We seek
comments on such approaches.
With respect to the user fees
generated from public safety customers
in a State, we discussed in the previous
section of this Second Notice our
preliminary conclusion that FirstNet or
a State assuming RAN responsibilities
may ultimately receive such fees
depending on the arrangement between
FirstNet and the State under the
spectrum capacity lease. Here, for the
reasons discussed above, we
preliminarily conclude that the Act
should be interpreted to require that
States assuming RAN responsibilities
that charge end user subscription fees to
public safety entities must reinvest such
fees into the network and that FirstNet
has a duty to consider both the
reinvestment of such fees and the costeffectiveness considerations discussed
above regarding the distribution of such
fees in entering into such a spectrum
capacity lease.
108 We note that even if our preliminary
conclusion is incorrect in terms of FirstNet’s
authority to consider the effects discussed above, in
any event the provisions regarding costeffectiveness of the plan, as interpreted by NTIA,
would nevertheless be a required consideration in
the application to NTIA for spectrum capacity
leasing rights under the Act.
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13349
An alternative interpretation
regarding reinvestment of subscriber
fees—that Congress intended States to
be able to divert such fee amounts to
State general funds—would seem to
have no basis in the structure and
purposes of the Act, which carefully
provides a reinvestment requirement for
CLA fees assessed by States (and
FirstNet) and when authorizing
subscriber fees by FirstNet.109
Subscriber fees may ultimately exceed
those derived from CLAs in any one
State, and it would make little sense for
Congress to have intended loss of the
former but retention of the latter for the
network, with such losses potentially
jeopardizing the interoperability and
technical evolution of the network. At a
minimum, the ability of States to
provide end user services to public
safety entities will ultimately depend on
the scope of the spectrum capacity lease
provided by FirstNet. Accordingly, we
preliminarily conclude that, absent clear
language to the contrary in the Act,
FirstNet could impose such a
reinvestment restriction within the
terms of such a lease. We seek
comments on these preliminary
conclusions.
We also preliminarily conclude here
that, for the reasons discussed above
related to CLAs, FirstNet, in the exercise
of its duties, can and must take into
account, among other things, the
considerations discussed above
regarding the effects on other States of
a State’s plan to retain all subscriber
fees in determining whether and under
what terms to enter into a spectrum
capacity lease with a State. Consistent
with our proposed approach to
efficiently leverage CLA fees from third
parties, FirstNet would explore ‘‘winwin’’ solutions with States desiring to
assume RAN and customer-facing
obligations if subscriber fees with or
without CLA fees would materially
exceed RAN and related costs in a State.
We seek comments on these preliminary
conclusions.
We turn now to the interpretation of
certain aspects of provisions addressing
the reinvestment of CLA fees assuming
that a State has received approval from
NTIA and entered into a spectrum
capacity lease with FirstNet. We note
the parallels between FirstNet and the
State’s provisions addressing the
reinvestment of fees. Subsection 6208(d)
requires FirstNet to reinvest those
109 This would be true even if Congress assumed
that some of such subscribers could be receiving
services for free because the same assumption could
have been made with respect to FirstNet fees. That
is, the Act does not require the imposition of fees,
only authorizes such fees, and then requires that,
if assessed, any such fees be reinvested.
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amounts received from the assessment
of fees under Section 6208 in the
NPSBN by using such funds only for
constructing, maintaining, operating, or
improving the network.110 Such fees
under Section 6208 include basic
network user fees and fees related to any
CLAs between FirstNet and a secondary
user.111
Parallel to FirstNet’s provision in
Section 6208(d), Section 6302(g)(2)
requires that any amounts gained from
a CLA between a State conducting its
own deployment of a RAN and a
secondary user must be used only for
constructing, maintaining, operating, or
improving the RAN of the State.112
However, the exact parallels between
the reinvestment prohibitions in the Act
applicable to FirstNet, and those
applicable to such States, end there.
Section 6208(a)(2) authorizes FirstNet
to charge lease fees related to CLAs.
Other than CLAs, however, FirstNet is
not expressly authorized to enter into
other arrangements involving the sale or
lease of network capacity. In potential
contrast, Section 6302(g)(1) precludes
States from providing ‘‘commercial
service to consumers or offer[ing]
wholesale leasing capacity of the
network within the State except directly
through public-private partnerships for
construction, maintenance, operation,
and improvement of the network within
the State.’’ Section 6302(g)(2), entitled
‘‘Rule of construction,’’ provides that
‘‘[n]othing in this subsection shall be
construed to prohibit the State and a
secondary user from entering into a
covered leasing agreement.’’ 113
These two components of subsection
6302(g) raise questions as to whether (1)
there is any type of PPP that is not a
CLA, and if so, (2) whether such a PPP
would permit commercial use of such
capacity more flexibly or less flexibly
than a CLA given the difference in their
respective requirements. That is, do
these provisions of the Act provide
States that assume RAN responsibility
more or less flexibility in wholesaling
capacity than FirstNet? Moreover, if
such a non-CLA PPP exists, under the
second sentence of Section 6302(g)(2),
amounts generated by such an
arrangement, unlike those from a CLA,
could under the literal terms of Section
6302(g)(2) potentially not be subject to
reinvestment in the network as that
provision states that it is revenues
gained ‘‘from such a leasing agreement’’
(ostensibly referring to ‘‘covered leasing
agreement’’ in the immediately
110 47
U.S.C. 1428(b).
id. § 1428(a).
112 Id. § 1442 (g)(2) (emphasis added).
113 Id. § 1442(g)(1).
111 See
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preceding sentence) that must be
reinvested.114
These potential differences between
the Act’s treatment of FirstNet and
States with regard to capacity leases
turn on whether Congress intended a
difference between the definition of
CLA, explored in the First Notice, and
a ‘‘public-private partnership for
construction, maintenance, operation,
and improvement of the network.’’
There are several differences in
statutory language between the two:
(1) CLAs must be a written agreement,
whereas PPPs are not expressly required to
be in writing;
(2) CLAs are ‘‘arrangements’’, whereas
PPPs are ‘‘partnerships’’;
(3) PPPs must include ‘‘improvement’’ of
the network in addition to the ‘‘construction’’
and ‘‘operation’’ of the network required by
both CLAs and PPPs;
(4) CLAs must include the ‘‘manage[ment]’’
of the network whereas PPPs must include
the ‘‘maintenance’’ of the network; and
(5) PPPs need not expressly permit (i)
access to network capacity on a secondary
basis for non-public safety services and (ii)
the spectrum allocated to such entity to be
used for commercial transmissions along the
dark fiber of the long-haul network of such
entity.
We believe, however, that in practical
terms the differences in items (1)–(4)
above are slight. For example, any
significant agreement of this type is
likely to be in writing, and most such
agreements could include improvement,
management, or maintenance of the
network in some manner to qualify.
With regard to item (5) above,
interpreted consistent with our
preliminary conclusions in the First
Notice, these ‘‘permit[ted]’’ uses could
provide express flexibility to a CLA
party but not a PPP. Nevertheless,
Section 6302(g)(2) permits States to
enter into CLAs, indicating an intent to
include CLAs within the scope of
PPPs.115 We thus preliminarily
114 We note, however, that the reinvestment
requirement of Section 6302(g)(2) actually requires
reinvestment in ‘‘constructing, maintaining,
operating, or improving’’ the RAN in the State,
which are the four items listed as the subject matter
of the PPPs of Section 6302(g)(1), not the CLA items
of Section 6208(a)(1), which are ‘‘construct[ing],
manag[ing], and operat[ing].’’ See 47 U.S.C. 1442(g),
§ 1448(a)(1). If Congress had intended to require
only reinvestment of CLA fees, they may have
referenced only the three areas that are the subject
of CLAs. An alternative interpretation could
therefore be that ‘‘such a leasing agreement’’ of
Section 6302(g)(2) refers back to the term
‘‘wholesale leasing’’ in Section 6302(g)(1), using the
term ‘‘agreement’’ as a generic reference to the PPP.
We seek comments on this alternative
interpretation. See id. § 1442(g)(2), § 1442(g)(1).
115 If the item (5) ‘‘permit[ed]’’ uses were
interpreted as limitations on a CLA partner, which
we preliminarily concluded in the First Notice was
not the case, then Section 6302(g)(2) would have
the strange result of requiring reinvestment of a
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conclude that, in practical effect, the
literal statutory differences result in
little difference between the Act’s
treatment of FirstNet and States that
assume RAN responsibility. We seek
comments on this preliminary
conclusion.
Given this preliminary conclusion, we
do not believe Congress intended to
permit such States to avoid
reinvestment in the network through
use of subtle differences in network
capacity arrangements. Nothing in the
Act indicates that such subtle
differences should justify driving scarce
resources away from the network and
thus, effectively, public safety entities.
Nor does anything in the Act indicate
that Congress intended the network to
be even a partial revenue generator for
States. Given the provisions of and
overall framework and policy goals of
the Act, we preliminarily conclude that
Congress intended that any revenues
from PPPs, to the extent such
arrangements are permitted and
different than CLAs, should be
reinvested into the network and that the
reinvestment provision of Section
6302(g) should be read to require as
such.116 We seek comments on this
preliminary conclusion.
Notwithstanding our preliminary
legal conclusions above, however,
fees—either basic user fees or those
from PPPs—used for purposes other
than constructing, maintaining,
operating, or improving the RAN in a
State could potentially severely impact
the ability of a State to maintain ongoing
interoperability and/or maintain
comparable security, coverage, and
quality of service to that of the NPSBN
over time. Accordingly, we believe the
potential loss to the network of either of
these revenue streams, and thus State
commitments to reinvest such revenue
streams if the final interpretation of
Section 6302(g) permits such losses,
could be considered by NTIA in
assessing any State alternate plans and
related demonstrations by a State, and
could be the subject of negotiated terms
in any spectrum capacity lease between
FirstNet and such a State in accordance
with our preliminary conclusions
regarding such leases above.
narrower class of capacity leases but not broader,
more flexible leases. 47 U.S.C. 1442(g)(2). This
interpretation makes little sense under the
framework of the Act, would permit the draining of
one of the most important sources of funding away
from State RANs, and thus we preliminarily
conclude that Section 6302(g)(2) and the definition
of CLAs should not be interpreted in this manner.
Id.
116 Id. § 1442(g)(2).
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III. Ex Parte Communications
Any non-public oral presentation to
FirstNet regarding the substance of this
Second Notice will be considered an ex
parte presentation, and the substance of
the meeting will be placed on the public
record and become part of this docket.
No later than two (2) business days after
an oral presentation or meeting, an
interested party must submit a
memorandum to FirstNet summarizing
the substance of the communication.
FirstNet reserves the right to
supplement the memorandum with
additional information as necessary, or
to request that the party making the
filing do so, if FirstNet believes that
important information was omitted or
characterized incorrectly. Any written
presentation provided in support of the
oral communication or meeting will also
be placed on the public record and
become part of this docket. Such ex
parte communications must be
submitted to this docket as provided in
the ADDRESSES section above and clearly
labeled as an ex parte presentation.
Federal entities are not subject to these
procedures.
Dated: March 9, 2015.
Stuart Kupinsky,
Chief Counsel, First Responder Network
Authority.
[FR Doc. 2015–05855 Filed 3–12–15; 8:45 am]
COMMITTEE FOR PURCHASE FROM
PEOPLE WHO ARE BLIND OR
SEVERELY DISABLED
Procurement List; Addition
Committee for Purchase from
People Who are Blind or Severely
Disabled.
ACTION: Addition to the Procurement
List.
AGENCY:
This action adds a service to
the Procurement List that will be
provided by a nonprofit agency
employing persons who are blind or
have other severe disabilities.
DATES: Effective: April 13, 2015.
ADDRESSES: Committee for Purchase
from People Who are Blind or Severely
Disabled, 1401 S. Clark Street, Suite
715, Arlington, Virginia 22202–4149.
FOR FURTHER INFORMATION CONTACT:
Barry S. Lineback, Telephone: (703)
603–7740, Fax: (703) 603–0655, or email
CMTEFedReg@AbilityOne.gov.
SUPPLEMENTARY INFORMATION:
mstockstill on DSK4VPTVN1PROD with NOTICES
Addition
On 1/2/2015 (80 FR 34), the
Committee for Purchase from People
VerDate Sep<11>2014
19:27 Mar 12, 2015
Jkt 235001
Regulatory Flexibility Act Certification
I certify that the following action will
not have a significant impact on a
substantial number of small entities.
The major factors considered for this
certification were:
1. The action will not result in any
additional reporting, recordkeeping or
other compliance requirements for small
entities other than the small
organization that will provide the
service to the Government.
2. The action will result in
authorizing a small entity to provide the
service to the Government.
3. There are no known regulatory
alternatives which would accomplish
the objectives of the Javits-WagnerO’Day Act (41 U.S.C. 8501–8506) in
connection with the service proposed
for addition to the Procurement List.
End of Certification
Accordingly, the following service is
added to the Procurement List:
BILLING CODE 3510–TL–P
SUMMARY:
Who are Blind or Severely Disabled
published notice of proposed addition
to the Procurement List.
After consideration of the material
presented to it concerning capability of
qualified nonprofit agency to furnish the
service and impact of the addition on
the current or most recent contractors,
the Committee has determined that the
service listed below is suitable for
procurement by the Federal Government
under 41 U.S.C. 8501–8506 and 41 CFR
51–2.4.
Service
Service Type: Janitorial Service.
Service is Mandatory for: GSA PBS Region 5,
Enterprise Computing Center, 985
Michigan Avenue, Detroit, MI.
Mandatory Source of Supply: Jewish
Vocational Service and Community
Workshop, Southfield, MI.
Contracting Activity: General Services
Administration, Public Buildings
Service, Acquisition Management
Division, Dearborn, MI.
Barry S. Lineback,
Director, Business Operations.
[FR Doc. 2015–05783 Filed 3–12–15; 8:45 am]
BILLING CODE 6353–01–P
COMMITTEE FOR PURCHASE FROM
PEOPLE WHO ARE BLIND OR
SEVERELY DISABLED
Procurement List; Proposed Additions
and Deletions
Committee for Purchase from
People Who are Blind or Severely
Disabled.
ACTION: Proposed additions to and
deletions from the Procurement List.
AGENCY:
PO 00000
Frm 00030
Fmt 4703
Sfmt 4703
13351
The Committee is proposing
to add a product and services to the
Procurement List that will be furnished
by nonprofit agencies employing
persons who are blind or have other
severe disabilities, and delete products
previously furnished by such agency.
DATES: Comments must be received on
or before: 4/13/2015.
ADDRESSES: Committee for Purchase
from People Who are Blind or Severely
Disabled, 1401 S. Clark Street, Suite
715, Arlington, Virginia, 22202–4149.
FOR FURTHER INFORMATION CONTACT: For
Further Information or to Submit
Comments Contact: Barry S. Lineback,
Telephone: (703) 603–7740, Fax: (703)
603–0655, or email CMTEFedReg@
AbilityOne.gov.
SUPPLEMENTARY INFORMATION: This
notice is published pursuant to 41
U.S.C. 8503 (a)(2) and 41 CFR 51–2.3. Its
purpose is to provide interested persons
an opportunity to submit comments on
the proposed actions.
SUMMARY:
Additions
If the Committee approves the
proposed additions, the entities of the
Federal Government identified in this
notice will be required to procure the
product and services listed below from
nonprofit agencies employing persons
who are blind or have other severe
disabilities.
The following product and services
are proposed for addition to the
Procurement List for production by the
nonprofit agencies listed:
Product
Product Name/NSN: Padfolio with Pen,
Department of State Logo, 8–1/2’’ x 11’’/
7510–01–NIB–1015.
Mandatory for Purchase by: Department of
State Diplomatic Security Service
Arlington, VA.
Manadatory Source of Supply: Industries for
the Blind, Inc., West Allis, WI.
Contracting Activity: Department of State, DS
Office of Acquisition Management
Arlington, VA.
Distribution: C-List.
Services
Service Type: Janitorial Service.
Service is Mandatory for: USDA, Agricultural
Research Service Grassland, Soil and
Water Research Laboratory, 808 East
Blackland Road, Temple, TX.
Mandatory Source of Supply: Rising Star
Resource Development Corporation,
Dallas, TX.
Contracting Activity: USDA ARS SPA 7MN1,
East College Station, TX.
Service Type: Mail Service.
Service is Mandatory for: US Air Force, Dyess
AFB, TX.
Mandatory Source of Supply: Training,
Rehabilitation, & Development Institute,
Inc., San Antonio, TX.
E:\FR\FM\13MRN1.SGM
13MRN1
]]>Agencies
[Federal Register Volume 80, Number 49 (Friday, March 13, 2015)]
[Notices]
[Pages 13336-13351]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2015-05855]
-----------------------------------------------------------------------
DEPARTMENT OF COMMERCE
National Telecommunications and Information Administration
First Responder Network Authority
[Docket Number 150306226-5226-01]
RIN 0660-XC017
Further Proposed Interpretations of Parts of the Middle Class Tax
Relief and Job Creation Act of 2012
AGENCY: First Responder Network Authority, National Telecommunications
and Information Administration, U.S. Department of Commerce.
ACTION: Notice and request for comments.
-----------------------------------------------------------------------
SUMMARY: The First Responder Network Authority (``FirstNet'') publishes
this Second Notice to request public comment on certain proposed
interpretations of its enabling legislation that will inform, among
other things, network policies, forthcoming requests
[[Page 13337]]
for proposals, and interpretive rules. With the benefit of the comments
received from this Second Notice, FirstNet may proceed to implement
these or other interpretations with or without further administrative
procedure.
DATES: Submit comments on or before April 13, 2015.
ADDRESSES: The public is invited to submit written comments to this
Second Notice. Written comments may be submitted electronically through
www.regulations.gov or by mail (to the address listed below). Comments
received related to this Second Notice will be made a part of the
public record and will be posted to www.regulations.gov without change.
Comments should be machine-readable and should not be copy-protected.
Comments should include the name of the person or organization filing
the comment as well as a page number on each page of the submission.
All personally identifiable information (e.g., name, address)
voluntarily submitted by the commenter may be publicly accessible. Do
not submit confidential business information or otherwise sensitive or
protected information.
FOR FURTHER INFORMATION CONTACT: Eli Veenendaal, First Responder
Network Authority, National Telecommunications and Information
Administration, U.S. Department of Commerce, 12201 Sunrise Valley
Drive, M/S 243, Reston, VA 20192; 703-648-4167; or
elijah.veenendaal@firstnet.gov.
SUPPLEMENTARY INFORMATION:
I. Introduction and Background
The Middle Class Tax Relief and Job Creation Act of 2012 (Pub. L.
112-96, Title VI, 126 Stat. 256 (codified at 47 U.S.C. 1401 et seq.))
(the ``Act'') established the First Responder Network Authority
(``FirstNet'') as an independent authority within the National
Telecommunications and Information Administration (``NTIA''). The Act
establishes FirstNet's duty and responsibility to take all actions
necessary to ensure the building, deployment, and operation of a
nationwide public safety broadband network (``NPSBN'').\1\
---------------------------------------------------------------------------
\1\ 47 U.S.C. 1426(b).
---------------------------------------------------------------------------
As detailed in our ``Proposed Interpretations of Parts of the
Middle Class Tax Relief and Job Creation Act of 2012'' (``First
Notice'') the rights and obligations of FirstNet, States and
territories, and state, federal, local, and tribal public safety
entities, among other stakeholders, turn on interpretation of the Act's
terms and provisions.\2\ In this Second Notice, we make preliminary
conclusions on a range of issues, including the equipment for use on
the FirstNet network, the nature and application of FirstNet's required
network policies, FirstNet's presentation of a state plan and its
implications for the rights and duties of other stakeholders, and the
rights of States choosing to assume responsibility to build and operate
a radio access network (``RAN'') in said State. We believe that
consideration of these preliminary conclusions and ultimately making
final determinations on these matters will further guide all parties
with regard to the building, deployment, and operation of the NPSBN.
---------------------------------------------------------------------------
\2\ The pronouns ``we'' or ``our'' throughout this Second Notice
refer to ``FirstNet'' alone and not FirstNet, NTIA, and the U.S.
Department of Commerce as a collective group.
---------------------------------------------------------------------------
Consistent with our approach in the First Notice, although FirstNet
is exempt from the procedural requirements of the Administrative
Procedure Act (``APA''),\3\ FirstNet desires to solicit public comments
on foundational legal issues, in addition to technical and economic
issues, to guide our efforts in achieving our mission.\4\ Thus, in
general FirstNet may pursue APA-like public notice and comment
processes such as this Second Notice, and we intend to rely upon
comments filed in response to this Second Notice to inform our actions,
including the establishment of network policies, development of
requests for proposals (``RFPs''), and other duties FirstNet is
assigned under the Act.
---------------------------------------------------------------------------
\3\ 47 U.S.C. 1426(d)(2).
\4\ See 79 FR 57058-9 (September 24, 2014).
---------------------------------------------------------------------------
With respect to this Second Notice, in instances where we have
drawn a preliminary conclusion and sought comments thereon, we
currently intend to issue a subsequent document indicating final
interpretative determinations, taking into consideration the comments
received. This subsequent document might not precede release of the
above-mentioned RFPs, which will nonetheless incorporate and constitute
such final interpretive determinations in light of the received
comments. Further, although we may, we do not currently anticipate
issuing further public notices and/or opportunities for comment or
reply comments on the preliminary conclusions made in this Second
Notice, and thus encourage interested parties to provide comments in
this proceeding.
In instances where we have not drawn a preliminary conclusion, but
have sought information and comment on an issue, we may issue
additional notices seeking comments on any preliminary conclusions we
may reach following review and consideration of the comments responding
to this Second Notice. That notice, if issued, may then be followed by
notice of final determinations. However, because we may not issue such
a further notice of preliminary conclusions at all or prior to
releasing the above-mentioned RFPs, we again encourage interested
parties to provide comments in this proceeding.
II. Issues
A. Technical Requirements Relating to Equipment for Use on the NPSBN
In the First Notice, we explored the network elements that comprise
the NPSBN. We address below a separate section of the Act concerning
equipment for use on the network. Our overarching considerations in
these interpretations are the Act's goals regarding the
interoperability of the network across all geographies and the cost-
effectiveness of devices for public safety.
Section 6206(b)(2)(B) requires FirstNet to ``promote competition in
the equipment market, including devices for public safety
communications, by requiring that equipment for use on the network be:
(a) Built to open, non-proprietary, commercially available standards;
(b) capable of being used by any public safety entity and by multiple
vendors across all public safety broadband networks operating in the
700 MHz band; and (c) backward-compatible with existing commercial
networks to the extent that such capabilities are necessary and
technically and economically reasonable.'' \5\ Several critical terms
in this provision must be interpreted to allow FirstNet to develop
requests for proposals and network policies that will fulfill these
requirements.
---------------------------------------------------------------------------
\5\ 47 U.S.C. 1426(b)(2)(B).
---------------------------------------------------------------------------
First, we must determine the scope of the ``equipment'' that must
satisfy the requirements of Section 6206(b)(2)(B). The Act states that
this Section applies only to equipment ``for use on'' the NPSBN, rather
than, for example, ``equipment of'' or ``equipment constituting'' the
network. Further, the Act makes clear that the range of equipment
implicated in the Section must at least include ``devices,'' which, in
the telecommunications market, is often a reference to end user
devices, rather than equipment used inside the network to provide
service to such devices. Finally, whatever the scope of the term
``equipment,'' such equipment
[[Page 13338]]
must be ``built to open, non-proprietary, commercially available
standards.''
In Section 6202, the Act describes the components of the NPSBN
itself, including a core network and RAN, and requires each to be based
on ``commercial standards.'' \6\ Thus, when describing criteria for the
equipment with which the network itself is to be constructed, the Act
requires use of only equipment built to commercial standards, whereas
in describing the equipment of Section 6206(b)(2)(B), the Act requires
that such equipment must be built not only to commercial standards, but
also ``open, non-proprietary'' standards.\7\ Therefore, given the ``for
use on'' language of the provision, the distinct addition of the terms
``open, non-proprietary,'' and the separate section of the Act
describing and prescribing requirements for the components of the
network itself, it appears that the equipment described in Section
6206(b)(2)(B) refers to equipment using the services of the network,
rather than equipment forming elements of the NPSBN core network or the
RAN.
---------------------------------------------------------------------------
\6\ See id. Sec. 1422(b).
\7\ Id. Sec. 1422(b)(2). We interpret the terms ``commercially
available standards'' and ``commercial standards'' as having the
same meaning as ``commercial standards'' defined in the Act.
---------------------------------------------------------------------------
This interpretation is supported by the other two elements
appearing in Section 6206(b)(2)(B). For example, Section
6206(b)(2)(B)(ii) requires that such equipment be ``capable of being
used by any public safety entity,'' which would seem inconsistent with
a requirement applicable to complex network routing and other equipment
used inside the network. Similarly, Section 6206(b)(2)(B)(iii) requires
such equipment to be ``backward-compatible with existing commercial
networks'' in certain circumstances, which would again make sense in
the context of end user devices, but not equipment being used to
construct the network. This interpretation is also consistent with
section 4.1.5.1, entitled ``Device or UE,'' of the Interoperability
Board Report.\8\
---------------------------------------------------------------------------
\8\ Section 6203 of the Act established the Technical Advisory
Board for First Responder Interoperability (``Interoperability
Board'') and directed it to develop minimum technical requirements
to ensure the interoperability of the NPSBN. 47 U.S.C. 1423. On May
22, 2012, the Interoperability Board, in accordance with the Act,
submitted its recommendations to the FCC in a report. See
Interoperability Board, Recommended Minimum Technical Requirements
to Ensure Nationwide Interoperability for the Nationwide Public
Safety Broadband Network (``Interoperability Board Report'') (May
22, 2012), available at https://apps.fcc.gov/ecfs/document/view?id=7021919873. On June 21, 2012, the FCC completed its review
of the Interoperability Board's final report and approved it for
transmittal to FirstNet. See FCC Order of Transmittal,
Recommendations of the Technical Advisory Board for First Responder
Interoperability, PS Dkt. No. 12-74, FCC 12-68 (rel. June 21, 2012),
available at https://apps.fcc.gov/edocs_public/attachmatch/FCC-12-68A1.pdf.
---------------------------------------------------------------------------
Thus, we preliminarily conclude that Section 6206(b)(2)(B) applies
to any equipment, including end user devices, used ``on'' (i.e., to use
or access) the network, but does not include any equipment that is used
to constitute the network. Given the interoperability goals of the Act
and that end user devices will need to operate seamlessly across the
network regardless of State decisions to assume RAN responsibilities,
we also preliminarily conclude that this provision applies whether or
not the equipment is to access or use the NPSBN via a RAN in a State
that has chosen to assume responsibility for RAN deployment.\9\ We seek
comments on these preliminary conclusions, and on what if any
equipment, other than end user devices, would fall under the scope of
Section 6206(b)(2)(B) under this conclusion.
---------------------------------------------------------------------------
\9\ See infra Section II.B.ii. (further discussing the term
``network'' as used in, for example, Section 6206(b)(2)).
---------------------------------------------------------------------------
Having preliminarily concluded that Section 6206(b)(2)(B) applies
to end user devices, we turn to the requirements of this provision.
Section 6206(b)(2)(B)(i) requires that all equipment used to access the
NPSBN must be built to ``open, non-proprietary, commercially available
standards.'' \10\ We seek comments on the scope of these requirements,
including in particular the extent to which they impose requirements
beyond the minimum requirements identified in the Interoperability
Board Report, and whether they would preclude, for example, proprietary
operating systems on devices. Such an expansive interpretation could
eliminate use of commercial Long-Term Evolution (``LTE'') devices used
by public safety entities today.
---------------------------------------------------------------------------
\10\ 47 U.S.C. 1426(b)(2)(B)(i).
---------------------------------------------------------------------------
The Act, however, defines ``commercial standards'' as ``technical
standards . . . for network, device, and Internet Protocol
connectivity.'' \11\ We thus preliminarily conclude that the Act's goal
of ``promot[ing] competition in the equipment market'' would still be
served, as it is today in the commercial market, by applying these
requirements to only those parameters necessary to maintain
interoperability with the NPSBN--that is, ``connectivity''--and which
are included in the Interoperability Board Report or otherwise in
FirstNet network policies. We recognize that, for innovation to bring
forth improved products for the NPSBN, and for FirstNet and public
safety entities to benefit from competition, product differentiation
must be allowed to thrive. However, such differentiation must be
balanced with the interoperability goals of the Act. Thus, certain
network technical attributes must be met by the equipment under the
terms of Section 6206(b)(2)(B), but other equipment attributes may be
left to individual vendors to develop. We seek comments on this
preliminary conclusion and the appropriate delineation between
attributes for ``connectivity'' and others.
---------------------------------------------------------------------------
\11\ Id. Sec. 1401(10) (emphasis added).
---------------------------------------------------------------------------
Beyond the Act's requirement that equipment for use on the network
comply with specific types of standards, Section 6206(b)(2)(B)(ii)
requires that the equipment be ``capable of being used by any public
safety entity and by multiple vendors across all public safety
broadband networks operating in the 700 MHz band.'' First, the
requirement that the equipment be capable of being used by any public
safety entity would appear to serve the cause of both interoperability
and competition in the equipment market by ensuring the largest market
possible for such devices. We seek comment on the limits of this
requirement, including whether use of the word ``capable'' permits
sufficient flexibility for product differentiation by public safety
discipline or application. For example, we preliminarily conclude that
this requirement would not preclude devices primarily designed for
police applications so long as such devices were technically capable of
being used by, for example, emergency medical services.
Next, we examine the requirement that such equipment be ``capable
of being used . . . by multiple vendors.'' \12\ We seek comments on the
distinction between Congress' use of the terms ``used . . . by multiple
vendors'' and, for example, if Congress had used the terms
``manufactured by multiple vendors,'' and whether this distinction
should be interpreted as requiring devices that are at least capable of
being sold to public safety entities through multiple suppliers who are
not themselves manufacturing the devices. We seek comments on how this
requirement should be interpreted to further the interoperability goals
of the Act.
---------------------------------------------------------------------------
\12\ Id. Sec. 1426(b)(2)(B)(ii).
---------------------------------------------------------------------------
The final phrase of the requirement--``across all public safety
broadband networks operating in the 700 MHz band''--could be
interpreted to modify just the vendor clause, but we preliminarily
conclude that, taken as a
[[Page 13339]]
whole, it appears that Congress desired both the public safety entity
clause and multiple vendor clause to be modified by the phrase.\13\ We
seek comments on this preliminary conclusion. The term 700 MHz band is
a defined term under the Act, and includes not just the frequencies
licensed to FirstNet, but all frequencies from 698 to 806
megahertz.\14\ Thus, we also seek comments on the appropriate
definition of, and which ``public safety broadband networks'' \15\
other than FirstNet would qualify under this clause, and note that the
Act contains a separate definition for ``narrowband spectrum.'' \16\
---------------------------------------------------------------------------
\13\ Id.
\14\ Id. Sec. 1401(1) (defining 700 MHz band).
\15\ Id. Sec. 1426(b)(2)(B)(ii) (emphasis added).
\16\ 47 U.S.C. 1401(20) (defining narrowband spectrum).
---------------------------------------------------------------------------
Finally, Section 6206(b)(2)(B) requires equipment for use on the
network to be ``backward-compatible with existing commercial networks
to the extent that such capabilities are necessary and technically and
economically reasonable.'' \17\ Such backwards compatibility could
prove very valuable for roaming and in the unlikely event that
FirstNet's Band 14 network encounters an outage. We seek comments on
the scope of the term ``backward-compatible,'' particularly with
respect to whether non-LTE networks (including switched-voice networks)
are implicated, and the criteria for determining whether such
capabilities are necessary and technically and economically reasonable.
---------------------------------------------------------------------------
\17\ Id. Sec. 1426(b)(2)(B)(iii).
---------------------------------------------------------------------------
B. FirstNet Network Policies
i. Overview
Under Section 6206(b), FirstNet must ``take all actions necessary
to ensure the building, deployment, and operation of the [NPSBN].''
\18\ In addition to this general charge, subsection (b) of Section 6206
itemizes a long list of specific actions FirstNet must take in
fulfilling this obligation.
---------------------------------------------------------------------------
\18\ Id. Sec. 1426(b)(1).
---------------------------------------------------------------------------
In the next subsection (c) of Section 6206, however, FirstNet is
tasked with establishing ``network policies'' in carrying out these
requirements of subsection (b).\19\ In particular, under subsection
(c)(1), FirstNet must develop the appropriate timetables, coverage
areas, and service levels for the requests for proposals referenced in
subsection (b), along with four sets of policies covering technical and
operational areas.\20\ In paragraph (2) of subsection (c), FirstNet is
required to consult with State and local jurisdictions regarding the
distribution and expenditure of amounts required to carry out the
network policies established in paragraph (1).\21\
---------------------------------------------------------------------------
\19\ See id. Sec. 1426(c)(1).
\20\ See id.
\21\ See id. Sec. 1426(c)(2)(A).
---------------------------------------------------------------------------
We explore these requirements below considering the overall
interoperability goals of the Act. These network policies, along with
the Interoperability Board Report, will form the fundamental basis of
such interoperability for public safety, and thus their scope and
applicability must be clear to equipment and device manufacturers,
network users, and any States that choose to assume RAN
responsibilities in their States.
ii. Network Policies
Under Section 6206(c)(1), entitled ``ESTABLISHMENT OF NETWORK
POLICIES,'' FirstNet is required to develop five groups of items, the
first being ``requests for proposals with appropriate'' timetables,
coverage areas, service levels, performance criteria, and similar
matters.\22\ Unlike the remaining four groups of items in paragraph
(1), this first group might not ordinarily be thought of as the subject
of a ``policy'' based on a plain language interpretation. The title of
the entire paragraph, however, does reference ``policies.'' In
addition, the consultation required in paragraph (2) of subsection (c)
is with regard to the ``policies established in paragraph (1),'' and
expressly includes topics such as ``construction'' and ``coverage
areas'' that are the subject of the requests for proposals listed in
paragraph (1)(A).\23\ Thus, we preliminarily conclude that the items
listed in paragraph (1)(A) are ``policies'' for purposes of paragraph
(2) and as the term is generally used in subsection (c).
---------------------------------------------------------------------------
\22\ 47 U.S.C. 1426(c)(1)(A).
\23\ See id. Sec. 1426(c).
---------------------------------------------------------------------------
In addition to the appropriate timetables, coverage areas, and
other items related to the requests for proposals in paragraph (1)(A),
FirstNet must develop policies regarding the technical and operational
requirements of the network; practices, procedures, and standards for
the management and operation of such network; terms of service for the
use of such network, including billing practices; and ongoing
compliance reviews and monitoring.\24\
---------------------------------------------------------------------------
\24\ See id. Sec. 1426(c)(1).
---------------------------------------------------------------------------
Taken as a whole, these policies, including the elements of the
requests for proposals, form the blueprint and operating parameters for
the NPSBN. Many of these policies will be informed by the partners
chosen to help deploy the network, and will likely change over time,
with increasing specificity as FirstNet begins operations. Some of
these policies, such as those related to the ``technical and
operational requirements of the network,'' will prescribe how the
FirstNet core network and RAN will interconnect and operate together,
consistent with the Interoperability Board Report. This interaction is
among the most important ``technical and operational'' aspects of the
network given the Act's definition of these terms and our preliminary
interpretations in the First Notice.\25\ For example, this interaction
would determine how the FirstNet core network implements authentication
and priority and preemption at the local level, including the framework
for such authentication and prioritization provided to local
jurisdictions to enable them to control important aspects of such
authentication and prioritization. Other technical, operational, and
business parameters essential to the nationwide interoperability of the
network will be determined by such policies governing core network and
RAN interactions. This raises the question as to whether and how
FirstNet's policies developed under subsection (1) apply to States that
assume responsibility for deployment of the RAN in such States under
Section 6302.
---------------------------------------------------------------------------
\25\ 79 FR 57059 (September 24, 2014) (discussing elements of
the network).
---------------------------------------------------------------------------
The Act does not expressly state whether only FirstNet, or both
FirstNet and a State assuming RAN responsibilities must follow the
network policies required under Section 6206(c)(1).\26\ Sections 6202
(defining the NPSBN) and 6206 (establishing FirstNet's duties) only
refer to the ``nationwide public safety broadband network'' or the
``network'', without expressly indicating whether such State RANs are
included in the term. We preliminarily conclude below that, given the
provisions of the Act, the
[[Page 13340]]
Interoperability Board Report, and the overall interoperability goals
of the Act and the effect on such interoperability of not having the
network policies of Section 6206(c)(1) apply to opt-out RANs, such
policies must so apply to ensure interoperability.
---------------------------------------------------------------------------
\26\ We preliminarily determined in our First Notice that such
State RANs must use the FirstNet core network when service is
provided to public safety entities. We stated that this preliminary
conclusion, which is supported by the express provisions in the Act
and sections of the Interoperability Board Report, was also
``supported by the overall interoperability goal of the Act, which
would, from a technical and operational perspective, be more
difficult to achieve if States deployed their own, separate core
networks to serve public safety entities.'' 79 FR 57059 (September
24, 2014). We received comments generally supporting this conclusion
overall, with some commenters suggesting that we also provide a
measure of flexibility to States assuming RAN responsibility so long
as the interoperability goals of the Act were achieved.
---------------------------------------------------------------------------
Section 6302(e), addressing the process by which a State may submit
a plan to assume RAN deployment, states that the alternative RAN plan
must demonstrate ``interoperability with the [NPSBN].'' \27\ This
interoperability demonstration is separate from a State's demonstration
that it will comply with the minimum technical interoperability
requirements of the Interoperability Board Report, and thus must
require a demonstration of interoperability in addition thereto.
Similarly, Section 6302(e)(3)(D) requires such States to demonstrate
``the ability to maintain ongoing interoperability with the [NPSBN].''
\28\
---------------------------------------------------------------------------
\27\ See 47 U.S.C. 1442(e)(3)(C)(II).
\28\ Id. Sec. 1442(e)(3)(D).
---------------------------------------------------------------------------
A literal reading of these provisions could be interpreted as
indicating a distinction between the NPSBN and such State RANs, such
that the policies required by Section 6206, which apply to the
``nationwide public safety broadband network'' or ``the network'' could
theoretically be interpreted as not directly applying to such RANs. We
preliminarily conclude, however, that such an interpretation reads too
much into the wording of Section 6302, which could also be interpreted
as requiring the State RAN to interoperate with ``the rest of'' the
NPSBN.
The Act's primary goal is the creation of an interoperable network
based upon a ``single, national network architecture that evolves with
technological advancements'' and is comprised of both a core network
and RAN.\29\ This suggests that network policies established by
FirstNet pursuant to Section 6206(c)(1) should apply to all elements of
the network, including RANs built by individual States, to ensure
interoperability. In addition, Congress did not differentiate between
opt-in and opt-out States in the provisions of Section 6206(c)(2)
requiring consultation with States on the policies of Section
6206(c)(1), and such consultations would presumably not be required for
States assuming RAN responsibility if the policies in question (at
least those applicable to RANs following opt-out) did not apply to
their RAN deployment.
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\29\ See id. Sec. 1422(b).
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In the context of the Act, we thus preliminarily conclude that an
important aspect of a State's demonstrations of interoperability under
Section 6302(e)(3) would be a commitment to adhering to FirstNet's
interoperability policies implemented under Section 6206(c) that are
applicable to NPSBN RANs. This could be particularly important because
such policies will likely evolve over time as the technology,
capabilities, and operations of the network evolve. An alternative
reading could result in freezing in time the interoperability of an
opt-out State RAN contrary to the goals of the Act. We seek comments on
these preliminary conclusions.
Notwithstanding these conclusions, however, the policies
established under Section 6206(c) would, if not directly, likely apply
indirectly to a State seeking to assume State RAN responsibilities. As
discussed above, such States must demonstrate interoperability with the
NPSBN, and from a practical perspective such interoperability will
largely depend, as is the case with FirstNet's deployed core networks
and RANs, on compliance with the network policies of Section
6206(c)(1).\30\ In addition, such States must also demonstrate
``comparable security, coverage, and quality of service to that of the
[NPSBN].'' \31\ FirstNet's policies will establish requirements for
such security, coverage, and quality of service standards for the
NPSBN, and thus States seeking to assume State RAN responsibilities
would, practically speaking, need to demonstrate ``comparable''
capabilities to those specified in these policies. The Federal
Communications Commission (``FCC'') and NTIA will presumably use these
policies in making this comparison at least at the point in time when a
State applies to assume RAN responsibilities.
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\30\ It is important to note that Congress required that a State
RAN plan demonstrate to the FCC both compliance with the
Interoperability Board Report and interoperability with the NPSBN,
indicating that the requirements of the Interoperability Report are
distinct from those further requirements that may be necessary to
interoperate with the NPSBN. See 47 U.S.C. 1442(e)(3(C). The
Interoperability Board Report focused on ``technical
interoperability,'' noting that this term was more limited than
general network interoperability. See Interoperability Board Report
at 23. To establish NPSBN interoperability therefore, we believe a
broader set of technical, business, and operational standards must
be developed pursuant to Section 6206(c)(1) and demonstrated by any
State seeking State RAN build and operation authority. Id. Sec.
1426(c)(1).
\31\ Id. Sec. 1442(e)(3)(D)(iii).
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Finally, given that FirstNet has a duty to ensure the deployment
and operation of a ``nationwide'' public safety broadband network, we
preliminarily conclude that, independent of the interpretations
discussed above, FirstNet could require compliance with network
policies essential to the deployment and interoperable operation of the
network for public safety in all States as a condition of entering into
a spectrum capacity lease under Section 6302(e)(3)(C)(iii)(II).\32\
Accordingly, in order to ensure the interoperability goals of the Act
and for the reasons discussed above, we preliminarily conclude that
FirstNet's network policies will either directly or indirectly apply to
any State RAN deployment. We note that FirstNet is subject to extensive
consultation requirements with States regarding such policies under
Section 6206(c)(2), and thus States will have substantial opportunities
to influence such policies and, as is discussed more fully below,
FirstNet will want to work cooperatively and over time with States in
their establishment. We seek comments on these preliminary conclusions.
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\32\ Id. Sec. 1442(e)(3)(C)(iii)(II).
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C. A State's Opportunity To Assume Responsibility for Radio Access
Network Deployment and Operation
i. Overview of Statutory Provisions on Deployment of State Networks
Section 6302(e) describes the process for determining whether
FirstNet or a State will conduct the deployment of the RAN within such
State.\33\ As we preliminarily concluded in the First Notice, the Act
requires FirstNet to provide the core network in all States.\34\ The
process for determining who will deploy the RAN in a State requires
FirstNet to provide States with (a) notice that FirstNet has completed
its request for proposal process for the construction and operation of
the nationwide network, (b) details of FirstNet's proposed plan for
buildout of the NPSBN in such State, and (c) the funding level, as
determined by NTIA, for such State.\35\ The Governor of a State, after
receiving the notice, must then choose to either participate in the
deployment of the network as proposed by FirstNet, or conduct its own
deployment of a RAN in such State.\36\
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\33\ See id. Sec. 1442(e).
\34\ 79 FR 57059 (September 24, 2014) (describing that the core
network provides the primary control layer of the network and
connects the RAN to the Internet and public switched network).
\35\ 47 U.S.C. 1442(e)(1).
\36\ Id. Sec. 1442(e)(2).
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It is important to note that the provisions of the Act, and the
interpretations discussed below, address what is essentially the final
or official plan presented to a State. FirstNet expects to work
cooperatively, and in keeping with its consultation obligations, with
each State in
[[Page 13341]]
developing its plan, including an iterative approach to plans in order
to achieve both a State's local and FirstNet's nationwide goals for the
NPSBN. Accordingly, none of the discussions in this Second Notice
should be interpreted as implying a unilateral or opaque approach to
plan development prior to the presentation of the official ``plan''
reflected in the Act.
Following such a FirstNet plan presentation, a decision by the
Governor to assume responsibility for deployment of the State's RAN
sets in motion an approval process for the State's alternative RAN
deployment plan.\37\ The FCC must approve the plan.\38\ If this
alternative RAN plan is approved, the State may apply to NTIA for a
grant to construct the RAN within the State and must apply to NTIA to
lease spectrum capacity from FirstNet.\39\ Conversely, if a State
alternative plan is disapproved, the RAN in that State will proceed in
accordance with FirstNet's State plan.\40\
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\37\ See id. Sec. 1442(e)(3).
\38\ See id. Sec. 1442(e)(3)(C).
\39\ See id. Sec. 1442(e)(3)(C)(iii).
\40\ See id. Sec. 1442(e)(3)(C)(iv).
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The Act is not entirely clear about the economic and operational
effects of an approved alternative State plan. The interpretations
discussed below will have substantial effects on the operation,
funding, and potentially the viability of the FirstNet program.
Congress drew a balance between the interoperability and self-
sustainment goals of the Act and preserving the ability of States to
make decisions regarding the local implementation of coverage,
capacity, and many other parameters if they wanted to exercise such
control. FirstNet has a duty to implement the Act in a manner that is
faithful to this balance and to the opportunity of States to exercise
local deployment control. But in balancing the above interests,
Congress was careful not to jeopardize the overall interoperability and
self-sustainment goals of the Act in its express provisions. For
example, a State's ability to exercise local control of deployment is
with respect to the RAN only, not the core network, and the State must
demonstrate that its alternative plan for the RAN maintains the overall
goals of the Act through, among other things, demonstrating
interoperability and cost-effectiveness.
In the discussions below we continue this balancing through our
preliminary interpretations of often complex provisions. These
interpretations are preliminary, and they attempt to remain faithful to
the balance Congress appears to have intended by affording States the
right to assume RAN responsibilities, but not at the cost of
jeopardizing the interoperability and self-sustainment goals of the Act
on which public safety entities and the overall program will depend.
ii. FirstNet Presentation of a State Plan
FirstNet must present its plan for a State to the Governor ``[u]pon
the completion of the request for proposal process conducted by
FirstNet for the construction, operation, maintenance, and improvement
of the [NPSBN] . . . .'' \41\ The Act does not further define when such
process is ``complete.'' The process cited is presumably the request
for proposal process detailed in subsections 6206(b) and (c), which
describe FirstNet's duty to develop and issue ``requests for
proposals.'' \42\ Because Section 6206 speaks in terms of plural
``requests for proposals,'' the ``process'' referenced in subsection
6302(e) could be interpreted to require completion of all such requests
for proposals, particularly given that Section 6302(e) refers to the
request for proposal process for the ``nationwide . . . network,''
rather than just a process for the State in question. This would
require the completion of requests for proposals for all States prior
to any one State receiving a plan from FirstNet.\43\
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\41\ 47 U.S.C. 1442(e).
\42\ See id. Sec. 1442(b)(1)(B), Sec. 1442(b)(2).
\43\ We note that FirstNet is still in the process of
determining whether it will follow a single, nationwide RFP process
or regional, State, or other multiple RFP processes.
---------------------------------------------------------------------------
We tentatively conclude, however, that it is reasonable to
interpret subsection 6302(e) to merely require completion of the
process for the State in question, rather than the nation as a whole,
prior to presentation of the plan to the State, assuming that FirstNet
can at that stage otherwise meet the requirements for presenting a plan
(and its contents) to such State.\44\ First, Section 6206 provides
FirstNet with flexibility in deciding how many and of what type of
requests for proposals to develop and issue. This flexibility inures to
the benefit of public safety and the States by allowing FirstNet to
reflect the input of regional, State, local, and tribal jurisdictions
under the required consultations of Section 6206. If Section 6302 were
read to require all States to await the completion of all such requests
for proposals, FirstNet would likely constrain the range of RFPs it
might otherwise conduct to avoid substantial delays nationwide, and in
doing so constrain its ability to reflect the input from consultative
parties.
---------------------------------------------------------------------------
\44\ See 47 U.S.C. 1442(e).
---------------------------------------------------------------------------
Second, such a ``wait for all'' approach could, depending on how
such requests for proposals are issued, nevertheless substantially
delay implementation of the network in many or most States contrary to
the Act's apparent emphasis ``to speed deployment of the network.''
\45\ For example, if a protest or litigation delayed proposals for one
State or a region, the entire network could be held hostage by such
litigation, creating substantial incentives for gamesmanship. Finally,
if Congress had wanted such an extreme result, we believe it would have
been more explicit than the generalized reference to ``network'' in
subsection (e).\46\ Thus, we preliminarily conclude that a State plan
can be presented to a State upon the completion of the request for
proposal process only to the extent necessary to develop such a plan
for such State. We seek comments on this preliminary conclusion.
---------------------------------------------------------------------------
\45\ Id. Sec. 1426(b)(1)(C).
\46\ Id. Sec. 1442(e).
---------------------------------------------------------------------------
An additional question regarding the interpretation of the term
``completion'' in subsection 6302(e) concerns the specific stage of the
request for proposal process that constitutes such ``completion.'' The
process prescribed by the Act itself may impose a practical limit on
the extent of such completion. Although we interpret the effects of a
State decision to assume RAN deployment responsibilities in detail in
subsequent sections of this Second Notice, for purposes of our
discussion here it is important to note that although a Governor's
decision to assume RAN responsibilities is on behalf of his or her
State, depending on the interpretations discussed below, an individual
State's decision could materially affect all other States and thus the
request for proposal process.
For example, depending on such interpretations, if a State chooses
to assume RAN responsibilities, it potentially takes with it subscriber
fees and/or excess network capacity fees that would have helped fund
the FirstNet network in all other States.\47\ Independent of funding
issues, by assuming RAN responsibilities the State also reduces
FirstNet's costs, at least with regard to the RAN, but also the volume
of purchase from a potential vendor. The net amount of such reduced
funding and costs, and the impact to economies of scale, determines
whether all other States will have a net reduction
[[Page 13342]]
in available funding and/or increased costs due to the opt-out.\48\
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\47\ See infra Section II.D.iii.
\48\ We note that FirstNet will be able to impose a user fee for
use of the FirstNet core network by such a State, which could make
up for, among other things, any added costs to integrate the State
RAN with the FirstNet core network.
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Given this dynamic, the specific States, and number thereof that
choose to assume RAN responsibilities will affect, potentially
materially, the final awards in the request for proposal process.\49\
The funding level in particular will determine the amount and quality
of products and services FirstNet can afford for public safety in the
request for proposal process to construct the network. In addition, the
information on the specific and number of opt-out States is an
important factor determining economies of scale and scope represented
by the FirstNet opportunity to potential vendors (and thus their
pricing to and the determination of costs for FirstNet).
---------------------------------------------------------------------------
\49\ From a timing standpoint, this holds true during the
pendency of such a State's application to assume RAN
responsibilities even if such application is ultimately
unsuccessful.
---------------------------------------------------------------------------
Under the Act, however, FirstNet must ``complete'' the request for
proposal process before presenting plans to the States and obtaining
this important information. States will, of course, want their plans to
provide as much specificity regarding FirstNet's coverage and services
as possible, which would ideally be determined on the basis of the
final outcomes of the request for proposal process (which, as is
discussed above, ideally requires the State opt-out decisions).
Accordingly, because of the circularity of these information needs,
FirstNet may not be able to provide the level of certainty in State
plans that would ordinarily be assumed to emerge from the final award
of a contract to a vendor to deploy in a State. Thus, we preliminarily
conclude that ``completion'' of the request for proposal process occurs
at such time that FirstNet has obtained sufficient information to
present the State plan with the details required under the Act for such
plan, which we discuss below, but not necessarily at any final award
stage of such a process. We seek comments on this preliminary
conclusion.
iii. Content of a State Plan
FirstNet must provide to the Governor of each State, or a
Governor's designee, ``details of the proposed plan for build out of
the [NPSBN] in such State.'' \50\ Section 6302 does not provide express
guidance as to what are the ``details of the proposed plan'' that must
be provided. Other provisions of the Act, however, provide some
guidance in this regard.
---------------------------------------------------------------------------
\50\ 47 U.S.C. 1442(e).
---------------------------------------------------------------------------
Because the plan details are to be provided upon completion of the
RFP process, we can of course reasonably conclude that such details are
contemplated to include outputs of such process, as discussed in the
previous section of this Second Notice.\51\ Further, Section
6206(c)(1)(A) requires that FirstNet include in RFPs ``appropriate''
timetables for construction, coverage areas, service levels,
performance criteria, and other ``similar matters for the construction
and deployment of such network.'' \52\ Therefore, it is reasonable to
conclude that Congress expected that FirstNet would be able to include
at least certain outcomes of the RFP process on such topics in a State
plan for the State in question. This is particularly true with regard
to construction and deployment of the RAN, regarding which the Governor
must make a decision in response to being presented with the plan. We
note that Section 6302(e)(1)(B) states that the details provided are
for the buildout of the network ``in such State'' only, although
FirstNet may choose to include details of, for example, core
functionality that will be implemented nationally or outside the State
with benefit to the State.
---------------------------------------------------------------------------
\51\ See supra Section II.C.ii.
\52\ See 47 U.S.C. 1422(c).
---------------------------------------------------------------------------
Other sections of the Act provide further insight as to what should
be included in a State plan. A State that seeks to assume
responsibility for the RAN in the State must present an alternative
plan to the FCC that ``demonstrate[s] . . . interoperability with the
[NPSBN].'' \53\ Thus, the State must at that point have knowledge of
how such interoperability can be achieved, either through receipt of
FirstNet network policies or the FirstNet plan for the State, or both.
Further, in order for a State to obtain grant funds or spectrum
capacity, it must ``demonstrate . . . that the State has . . . the
ability to maintain ongoing interoperability with the [NPSBN] . . . and
the ability to complete the project within specified comparable
timelines specific to the State.'' \54\ Thus, for example, implicitly
the State must have been presented with FirstNet timelines with which
NTIA may ``compare'' to the State alternative plan.
---------------------------------------------------------------------------
\53\ Id. Sec. 1442(e)(3)(C)(ii).
\54\ Id. Sec. 1442(e)(3)(D) (emphasis added).
---------------------------------------------------------------------------
In order to obtain grant funds or spectrum capacity, a State must
also ``demonstrate . . . the cost-effectiveness of the State plan . . .
and . . . comparable security, coverage, and quality of service to that
of the [NPSBN].'' \55\ Thus, similar to the timelines discussed above,
implicitly the FirstNet plan (in combination with FirstNet network
policies) must provide the State with sufficient information to enable
NTIA to make comparisons of cost-effectiveness, security, coverage, and
quality of service. We seek comments on the above preliminary
conclusions regarding the minimum legally required contents of a
FirstNet plan for a State.\56\ Finally, as discussed above, we
preliminarily conclude that certain limitations regarding plan content
are inherent in the plan process prescribed by the Act.\57\
---------------------------------------------------------------------------
\55\ Id. Sec. 1442(e)(3)(D).
\56\ As stated above, however, FirstNet may provide more details
than are legally required under the Act.
\57\ See supra Section II.C.ii.
---------------------------------------------------------------------------
iv. Governor's Role in the State Plan Process
Section 6302(e)(2), entitled ``State decision,'' is clear that
``the Governor shall choose'' whether a State participates in the
FirstNet proposed plan or conducts its own deployment of a RAN in such
State.\58\ Thus, we preliminarily conclude that the decision of the
Governor in this regard will, for purposes of the Act, be binding on
all jurisdictions within such State. For example, if the Governor of a
State decides the State will participate in FirstNet's plan for
buildout of the State, a city or county within the State would not be
able to separately choose to deploy a RAN.\59\ Aside from the clear
language of the Act regarding the Governor's role and decision, such
sub-State level opt-out, if permitted, could create potential islands
of RANs which do not meet the interoperability and other similar goals
of the Act, and FirstNet would have to agree to use of its spectrum in
such cases. We note, however, that FirstNet and a State could agree
that, as part of FirstNet's plan, FirstNet and the State (or sub-State
jurisdictions) could work together to permit, for example, State
implementation of added RAN coverage, capacity, or other network
components beyond the FirstNet plan to the extent the interoperability,
quality of service, and other goals of the Act were met. These further
customizations of State deployments over time may form an important
aspect of the FirstNet implementation nationwide. These additions have
been raised in
[[Page 13343]]
consultation with state and local jurisdictions and could improve the
network and provide additional coverage. We seek comments on the above
preliminary conclusions. We also seek comments, considering the
provisions of the Act and other applicable law, on the effect of both,
a Governor's decision to participate in FirstNet's plan for a State,
and a Governor's decision to apply for and assume RAN responsibilities
in a State, on tribal jurisdictions in such a State.
---------------------------------------------------------------------------
\58\ See 47 U.S.C. 1442(e)(2) (emphasis added).
\59\ We discuss certain post-State-decision aspects of this
issue in subsequent sections of this Second Notice.
---------------------------------------------------------------------------
v. Timing and Nature of State Decision
Section 6302(e)(2) requires that the Governor make a decision
``[n]ot later than 90 days after the date on which the Governor of a
State receives notice under [Section 6302(e)(1)].'' \60\ This
phraseology raises the question as to whether a Governor could make
such a decision prior to receiving such notice.
---------------------------------------------------------------------------
\60\ 47 U.S.C. 1442(e)(2).
---------------------------------------------------------------------------
We preliminarily conclude that the Governor must await such notice
and presentation of the FirstNet plan prior to making the decision
under Section 6302(e)(2). The language of Section 6302(e)(2) creates a
90-day period ``after the date'' the notice is received, and the
decision is clearly designed to be informed by the FirstNet plan.
In addition, any alternative interpretation would not fit within
the process contemplated by the Act. Even if a State were able to make
a qualifying decision prior to such notice, and we preliminarily
conclude it could not, such a decision would trigger the 180-day clock
for submitting an alternative plan to the FCC, discussed below. Without
a FirstNet plan having been presented, the State's premature decision
would not enable the FCC to make the assessments required to approve
the State's alternate plan, or if such plan is approved, enable NTIA to
review and determine whether to grant an application for grant funds
and/or spectrum capacity. For example, without the FirstNet plan, a
State would not be able to demonstrate to the FCC that its alternative
RAN would be interoperable with the yet-unspecified FirstNet core
network interconnection points within the State. Nor would a State be
able to demonstrate ``comparable'' timelines, security, coverage, or
quality of service, as required by Section 6302(e)(3)(D).\61\ Thus, the
Governor's premature decision, prior to a FirstNet plan, would likely
be unworkable under the requirements in the Act.\62\ We seek comments
on this preliminary conclusion.
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\61\ Id. Sec. 1442(e)(3)(D)(iii).
\62\ The Act's requirement that a State be presented a plan
prior to rejecting it also ensures that each State has adequate
information to determine whether the State would receive a greater
benefit from either participating in the FirstNet proposed network
plan for such State or by conducting its own deployment of the RAN
in such State. More specifically, the contents of the notice
provided under Section 6302(e)(1) will be necessary for a State to
make an informed decision as to whether the State has the resources
and capability to demonstrate it can meet the minimum technical,
operational, funding, and interoperability requirements described
throughout Section 6302(e). See 47 U.S.C. 1442(e).
---------------------------------------------------------------------------
vi. Notification of State Decision
The Act does not require the Governor of a State to provide notice
of its decision to participate in the FirstNet proposed network under
Section 6302(e)(2)(A) to FirstNet, or any other parties. Rather, notice
is only required, as is discussed in detail below, should the Governor
of a State decide that the State will assume responsibility for the
buildout and operation of the RAN in the State.\63\ Thus, we
preliminarily conclude that a State decision to participate in the
FirstNet proposed deployment of the network in such State may be
manifested by a State providing either (1) actual notice in writing to
FirstNet within the 90-day \64\ decision period or (2) no notice within
the 90-day period established under Section 6302(e)(2). We seek
comments on these preliminary conclusions.
---------------------------------------------------------------------------
\63\ See id. Sec. 1442(e)(3).
\64\ In the absence of language to the contrary, we interpret
the days specified in the Act as calendar days and seek any comments
on this preliminary interpretation.
---------------------------------------------------------------------------
Read literally, the 90-day period established under Section
6302(e)(2) applies to the Governor's decision, rather than the notice
of such decision, which is addressed in Section 6302(e)(3). We
preliminarily conclude, however, that it is clear from the language of
Section 6302(e)(3) that the notice is to be provided to FirstNet, NTIA,
and the FCC ``[u]pon making a decision . . . under paragraph (2)(B).''
\65\ Thus, we interpret the requirement to issue such notice as an
immediate (i.e. same day) requirement, and that Congress did not intend
to apply an artificial deadline on the Governor's decision, and then
permit an indefinite period to lapse before providing notice of such
decision. Such an indefinite period would run contrary to the Act's
emphasis on the ``speed of deployment'' of the network for public
safety.\66\ We seek comments on this preliminary conclusion.
---------------------------------------------------------------------------
\65\ 47 U.S.C. 1442(e)(3).
\66\ See e.g., 47 U.S.C. 1426(b)(1)(C) (describing the need for
use of existing infrastructure to speed deployment of the network);
see also e.g., 47 U.S.C. 1426(b)(3) (encouraging FirstNet to seek
cost effective opportunities to speed deployment in rural areas).
---------------------------------------------------------------------------
vii. The Nature of FirstNet's Proposed State Plan
The Act describes what FirstNet is to propose to each State as a
``plan.'' \67\ Section 6302 describes a process for the implementation
of the nationwide public safety broadband network in each State.\68\
FirstNet's presentation of a plan to the Governor of each State for
buildout in that State and his/her decision to participate in such
buildout as proposed by FirstNet or to deploy the State's own RAN are
important steps of this process. However, we preliminarily conclude
that FirstNet's presentation of a plan to a Governor and his/her
decision to either participate in FirstNet's deployment or follow the
necessary steps to build a State RAN, do not constitute the necessary
``offer and acceptance'' to create a contract.
---------------------------------------------------------------------------
\67\ A plan is defined as ``a detailed proposal for doing or
achieving something.'' Oxford Dictionaries, available at https://www.oxforddictionaries.com/us/definition/english/plan.
\68\ 47 U.S.C. 1442(e).
---------------------------------------------------------------------------
Nowhere does the Act use words of contract, such as ``offer,''
``execute,'' or ``acceptance'' in relationship to the FirstNet plan.
For example, a Governor's decision is whether to ``participate'' in the
FirstNet plan. The Act provides the Governor with 90 days to make a
decision once presented with the plan, which would be an extremely
short period within which to negotiate a final contract of this
magnitude if a contract were contemplated. Notwithstanding this
preliminary conclusion, a State would, however, ultimately benefit from
any contractual remedies that FirstNet can enforce against its
contracting parties for deployment of the network in the State.
In addition, we believe this interpretation is reasonable given
that establishing the plan as a contract between FirstNet and a State
would likely be unrealistic in light of the nature of the FirstNet
program. For example, as discussed above, the process prescribed in the
Act itself may make contract-like promises at the plan stage
difficult.\69\ In addition, subscriber adoption and fees will form an
important funding and self-sustaining basis for FirstNet, dictating at
least part of the scope of its ongoing buildout, features, and timing.
These levels of subscriber adoption and fees across the network overall
will not be known at the State plan stage and will likely be express
assumptions thereunder.
---------------------------------------------------------------------------
\69\ See supra Section II.C.ii.
---------------------------------------------------------------------------
Unlike the plan itself, however, when public safety entities
subscribe to
[[Page 13344]]
FirstNet's services, those subscription agreements are expected to take
the form of contracts with FirstNet, including contractual remedies in
the event FirstNet service does not meet promised-for service levels.
Similarly, to the extent FirstNet enters into contracts with State or
local agencies for use of local infrastructure, those contracts will be
negotiated and presumably contain contractual remedies for both
parties.\70\ We seek comments on the above preliminary conclusions.
---------------------------------------------------------------------------
\70\ FirstNet is specifically authorized to make contracts with
Federal, State, regional, and local agencies. See 47 U.S.C. 1426
(a)(3), (b)(4)(A).
---------------------------------------------------------------------------
viii. State Development of an Alternative Plan
Section 6302(e)(3)(B) requires, not later than 180 days \71\ after
a Governor provides a notice under Section 6302(e)(3)(A), that the
Governor develop and complete requests for proposals for construction,
maintenance, and operation of the RAN within the State.\72\ We believe
the Act imposes this 180-day period to ensure that the public safety
entities in and outside the State gain the benefit of interoperable
communications in the State in a reasonable period of time, either
through the FirstNet plan or a State plan.
---------------------------------------------------------------------------
\71\ In the absence of language to the contrary, we interpret
the days specified in the Act as calendar days.
\72\ 47 U.S.C. 1442(e)(3)(B).
---------------------------------------------------------------------------
Consistent with our preliminary interpretation of the
``completion'' of the FirstNet request for proposal process,\73\ we
preliminarily conclude that the phrase ``complete requests for
proposals'' means that a State has progressed in such process to the
extent necessary to present an alternative that could demonstrate the
technical and interoperability requirements described in Section
6302(e)(3)(C)(i).\74\ Like FirstNet, States will potentially have gaps
in information at the time of their request for proposal process, and
subsequently at the time of their submission of an alternative plan.
For example, to the extent such States have not negotiated at least the
material parameters of a spectrum capacity lease agreement with
FirstNet at the time of an RFP, they will be unable to finally
determine the terms, which may be materially affected by such
parameters, of any covered leasing agreement (``CLA'') the State would
enter into to offset some or all their costs of construction. Nor will
NTIA have potentially approved of such spectrum capacity leasing rights
at that point. Thus, we encourage States that may contemplate such a
process to engage FirstNet as early as possible to increase the
specificity of the alternative plans they can present to the FCC and
NTIA.
---------------------------------------------------------------------------
\73\ See supra Section II.C.ii.
\74\ See 47 U.S.C. 1442(e)(3)(C)(i).
---------------------------------------------------------------------------
In keeping with this interest in timely network deployment, we
preliminarily conclude that where a State fails to ``complete'' its
request for proposal process in the 180-day period under the Act, the
State would forfeit its ability to submit an alternative plan in
accordance with paragraph (e)(3)(C).\75\ This forfeiture would result
in the construction, maintenance, operations, and improvements of the
network within the State proceeding in accordance with the FirstNet
plan. We expect that the FCC will establish procedures regarding the
filing of alternative State plans where States have completed their
requests for proposal in a timely fashion. We seek comments on these
preliminary conclusions.
---------------------------------------------------------------------------
\75\ Id. Sec. 1442(e)(3)(C).
---------------------------------------------------------------------------
ix. Responsibilities of FirstNet and a State Upon a State Decision To
Assume Responsibility for the Construction and Operation of Its Own RAN
Under Section 6302(e)(3)(C)(ii), States with alternative plans
approved by the FCC may apply to NTIA for a grant to construct a RAN
within that state and must apply to NTIA to lease spectrum capacity
from FirstNet.\76\ We preliminarily conclude that approval by the FCC
of an alternative State plan results in that State being solely
responsible for the construction, operation, maintenance, and
improvement of the RAN in such State in accordance with the State's
approved plan, thereby extinguishing any obligation of FirstNet to
construct, operate, maintain, or improve the RAN in such State.\77\
Certainty as of the date upon which the FCC approves or disapproves the
alternative plan is important for FirstNet in determining the final
economics of its network and business planning and thus its ability to
move forward, with vendors and otherwise, in that and other States. We
seek comments on this preliminary conclusion.
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\76\ Id. Sec. 1442(e)(3)(C)(iii).
\77\ Such a State would, however, at a minimum still require
approval from NTIA for spectrum capacity leasing rights and still
fulfill their contractual requirements of any spectrum capacity
lease negotiated with FirstNet. In addition to FirstNet's
obligations under such a spectrum capacity lease, FirstNet would
also have to fulfill its obligations, including any supervision
obligations, under FCC rules as the licensee of the FirstNet
spectrum with regard to any such State's use thereof.
---------------------------------------------------------------------------
The Act, however, does not provide a mechanism for a State,
following an FCC-approved State RAN plan, to reinitiate an ``opt-in''
process where FirstNet would assume the duty to build the NPSBN in that
State. For example, if the sequence of events ended with a State
receiving approval of its alternative plan by the FCC but being unable
to reach agreement on a spectrum capacity lease with FirstNet or being
denied approval of such spectrum capacity leasing rights or needed
grant funds by NTIA, the State subsequently would be unable to operate
the RAN in the State. Although we intend to work closely with the FCC,
NTIA, and States to try to anticipate and avoid any such unnecessary
process issues, we preliminarily conclude that the inability of a State
to implement its alternative plan for such reasons would not preclude a
State and FirstNet from agreeing to allow FirstNet to implement the RAN
in such State. FirstNet's duty is the deployment of the network
nationwide, and deployment in all States greatly benefits the nation as
a whole. As such, we do not believe Congress intended to put such
States in limbo with regard to the NPSBN.
Further, because such uncertainty in any one State would affect the
benefits of the NPSBN nationwide, we preliminarily conclude that denial
by NTIA of at least the spectrum capacity leasing rights would then
permit FirstNet to implement a plan in the State.\78\ Absent this
interpretation, any one State could indefinitely delay, among other
things, construction of the network in such State, the funding derived
from spectrum capacity leases in such State, and the positive effects
of economies of scale and scope from construction and operation in such
State, all to the detriment of all other States and citizens through
the effect on the FirstNet program. In the absence of express
provisions under the Act, we believe this preliminary interpretation
appropriately balances Congress' intent to have a nationwide network
implementation as soon as possible with the rights of States to conduct
their own RAN deployment if, and only if, they can meet the
requirements under Section 6302(e)(3). We seek comments on this
preliminary conclusion and any alternative processes that meet the
requirements of the Act.
---------------------------------------------------------------------------
\78\ Following denial of the application for a spectrum capacity
lease in Section 6302(e)(3)(C)(iii)(II), FirstNet would remain the
licensee of the spectrum in question. See 47 U.S.C.
1442(e)(3)(C)(iii)(II).
---------------------------------------------------------------------------
Beyond the above scenarios, if a State initially enters into a
spectrum capacity lease with FirstNet and receives all
[[Page 13345]]
necessary approvals, because of FirstNet's authority to enter into
contracts with State and local agencies, we preliminarily conclude that
a State may ultimately seek to have FirstNet, assuming mutually
acceptable terms, take over some or all RAN responsibilities in the
State through a contractual agreement.\79\ Given the benefit to the
nation of a functioning network within all States, we believe this
capability is important in the event, for example, that a State plan
fails after approval and execution of a spectrum capacity lease. We
seek comments on these preliminary conclusions.
---------------------------------------------------------------------------
\79\ How such an agreement or the circumstances giving rise to
the agreement, if permitted, would be treated by the FCC or NTIA
under Section 6302(e)(3) would depend on such decisions, rules, or
regulations of the FCC or on NTIA's decisions. See 47 U.S.C.
1442(e)(3).
---------------------------------------------------------------------------
Finally, under Section 6302(e)(3)(C)(iv), if the FCC disapproves an
alternative State plan, the construction, maintenance, operation, and
improvements of the radio access network in that State will proceed in
accordance with the State plan proposed by FirstNet.\80\ Thus, we
preliminarily conclude that once a plan has been disapproved by the
FCC, subject only to the additional review described in Section
6302(h), the opportunity for a State to conduct its own RAN deployment
under Section 6302(e) will be forfeited, and FirstNet may proceed in
accordance with its proposed plan for that State.\81\ This certainty of
obligation is important for both FirstNet planning regarding self-
sustainability and to ensure that the network is built in a timely
manner. We seek comments on these preliminary conclusions.
---------------------------------------------------------------------------
\80\ 47 U.S.C. 1442(e)(3)(C)(iv).
\81\ Id. Sec. 1442(h) (describing the jurisdiction and standard
of review for reviewing the disapproval of a plan by the FCC).
---------------------------------------------------------------------------
D. Customer, Operational and Funding Considerations Regarding State
Assumption of RAN Construction and Operation
i. Overview
Having discussed above many of the procedural aspects of a State's
decision to assume RAN responsibilities, we turn to some of the
potential substantive ramifications of such a decision. Importantly,
and as is also discussed above, these ramifications can reach beyond
the borders of the State making the decision. They include potential
effects in and outside the State on public safety customers, FirstNet's
costs and available funding nationally, including its ability to meet
substantial rural milestones, and the purchasing power of FirstNet on
behalf of public safety. In addition to these critical considerations,
in order to achieve the goals of the Act following a State decision to
assume RAN responsibilities, FirstNet and such a State must in all
cases define and implement a potentially complex operational
relationship to serve public safety.
In arriving at the preliminary interpretations below, we endeavored
to remain faithful to the balance Congress struck between the
deployment of a nationwide network as soon as practicable, and the
right of States to deploy their own RAN under the conditions outlined
in the Act. The most difficult of these preliminary interpretations
relate to areas where the Act is either completely silent or provides
only inferential guidance. These include topics such as who actually
provides service to public safety entities in opt-out States, who
receives and may use fees from such services and for what purposes, and
whether Congress intended the right to opt-out under the Act to
include, particularly with respect to fees for use of excess network
capacity, the right to fundamentally affect the complex funding
structure of the FirstNet program in all other States in favor of the
State opting out.
We discuss below preliminary conclusions regarding these issues,
but expect the highly complex legal and operational landscape in these
areas to also mature over time, particularly in light of FirstNet
consultations, including most importantly the comments received from
this Second Notice.
ii. Customer Relationships in States Assuming RAN Construction and
Operation
The Act does not expressly define which customer-facing roles are
assumed by a State or FirstNet with respect to public safety entities
in States that have assumed responsibility for RAN construction and
operation. Generally speaking all wireless network services to public
safety entities will require technical operation of both the RAN,
operated by the State in this case, and the core network, operated by
FirstNet in all cases as we preliminarily concluded in the First
Notice.\82\ We received predominantly supportive comments in response
to this preliminary conclusion in the First Notice, with some
commenters suggesting flexibility, on a State-by-State basis, in the
precise delineation of technical and operational functions performed by
the FirstNet core network and States assuming RAN responsibilities in
such States.\83\ A core network, for example, would typically control
critical authentication, mobility, routing, security, prioritization
rules, and support system functions, including billing and device
services, along with connectivity to the Internet and public switched
network. The RAN, however, would typically dictate, among other things,
the coverage and capacity of last mile wireless communication to
customer devices and certain priority and preemption enforcement points
at the wireless interface of the network. Either alone is an incomplete
network and each must work seamlessly with the other. As a result,
FirstNet and such States must similarly work together to ensure that
public safety is provided the critical wireless services contemplated
by the Act.
---------------------------------------------------------------------------
\82\ See 79 FR 57059 (September 24, 2014).
\83\ See, e.g., Comments of the State of Florida at 3-4 (stating
``Florida acknowledges that the Act requires FirstNet to build the
core network. The Act, does not however, prohibit any other party
from building and operating a core network, as long as it meets the
interoperability and operational standards promulgated by FirstNet.
Florida encourages FirstNet to remain flexible when creating its
network architecture to provide options for the various States to
best meet their broadband needs in support of their public safety
missions.'') available at https://www.regulations.gov/#!documentDetail;D=NTIA-2014-0001-0013; See also, e.g., Consolidated
Response of the MACINAC Initiative to the Request for Information
For Comprehensive Network Solution(s) and Public Notice and Comment
Request for Comments at 8 (stating ``MACINAC is not interested in
operating a core, nor is it advocating for State-run cores; instead
we are suggesting that when considering the line of demarcation
between RAN and core, FirstNet must be careful to respect the
distinction between technology [the hardware, software, and
standards] and the policy and operation of the core services. Public
safety entities will be unlikely to support the network unless
FirstNet provides States and local governments the means to control
and manage services such as billing, location, and device
services.'') available at https://www.regulations.gov/#!documentDetail;D=NTIA-2014-0001-0008.
---------------------------------------------------------------------------
These technical and operational functions and interactions between
the RAN and core network, however, can vary to a limited extent that
would not necessarily jeopardize the interoperability goals of the Act.
FirstNet preliminarily concludes that it will maintain a flexible
approach, advocated by some States in their comments to the First
Notice, to such functions and interactions in order to provide the best
solutions to each State so long as the interoperability and self-
sustainment goals of the Act are achieved.\84\ The allocation of such
technical and operational functions,
[[Page 13346]]
however, does not entirely dictate who assumes public safety customer-
facing roles, such as marketing, execution of customer agreements,
billing, maintaining service responsibility, and generating and using
fees from public safety customers. States assuming RAN responsibilities
could, for example, operate as partial resellers or enter into Mobile
Virtual Network Operator (``MVNO'')-like arrangements \85\ with
FirstNet to use part or all of its core network to offer service to
public safety entities in a State. Alternatively, such States could act
as a RAN supplier to FirstNet, customizing the RAN to local needs but
placing the responsibility with FirstNet to market, serve, and bill
public safety entities in the State. There are a variety of such
possible arrangements, and we preliminarily conclude below that the Act
provides sufficient flexibility to accommodate many of them so long as
the interoperability and self-sustainment goals of the Act are met.
---------------------------------------------------------------------------
\84\ FirstNet is continuing to review comments in response to
the preliminary conclusions in its First Notice and makes no final
determinations with respect thereto in this Second Notice.
\85\ In a traditional MVNO relationship, a mobile operator
supplies the RAN and some components of the core network to the
MVNO.
---------------------------------------------------------------------------
We first note, as we preliminarily concluded in the First Notice,
that the State decision is as to whether to control deployment of the
RAN, not the core network, and as is discussed above, the RAN alone is
insufficient to offer wireless service. Under Section 6302(f), FirstNet
is authorized to charge States assuming such RAN responsibilities user
fees for ``use of elements of the core network.'' \86\ This clause
could be interpreted as evidence of Congress' contemplation of such a
State's use of the FirstNet core network to provide service to public
safety entities in a resale or MVNO-like arrangement. But there are a
variety of circumstances, other than providing end user services, under
which a State may want to use elements of the FirstNet core network.
For example, the FirstNet core network would have to be used to enable
RAN sharing as specified by the Interoperability Board Report in
connection with a CLA between the State and a third party. In addition,
if the State itself subscribed to FirstNet services, because the State
is responsible for the RAN, the State and FirstNet would have to
negotiate an agreement addressing, among other things, State use of the
core network. Thus, this clause alone does not, generally speaking,
appear to indicate one way or another who is to be the customer-facing
service provider in a State that has assumed RAN responsibility and
could provide flexibility in this regard.
---------------------------------------------------------------------------
\86\ 47 U.S.C. 1442(f).
---------------------------------------------------------------------------
Similarly, Section 6302(e)(3)(D) indicates that such a State is to
``operate . . . the State radio access network'' and ``maintain ongoing
interoperability with the [NPSBN].'' \87\ Neither of these requirements
necessarily indicates a customer-facing role. The State is expressly
operating the RAN, not the NPSBN as a whole in the State. Thus, these
clauses similarly do not appear to be restrictive in this regard.
---------------------------------------------------------------------------
\87\ Id. Sec. 1442(e)(3)(D).
---------------------------------------------------------------------------
The Act requires that States seeking to obtain grant funds or
spectrum capacity leasing rights must demonstrate ``comparable . . .
quality of service to that of [FirstNet].'' \88\ This provision implies
that States building and operating a RAN are at least providing a
``quality of service'' to someone. For example, the clause could mean
that because the RAN is part of the network that FirstNet is using to
provide service to a public safety customer, the State must demonstrate
that this ultimate level of service from FirstNet will not be
diminished relative to what FirstNet would provide under its plan.
Alternatively, the provision could be interpreted as contemplating a
State providing a quality of service to end user customers. Again, this
clause does not appear to clearly require one or the other customer-
facing roles.
---------------------------------------------------------------------------
\88\ Id. Sec. 1442(e)(3)(D)(iii).
---------------------------------------------------------------------------
Another important provision relevant to this determination
precludes States that assume RAN responsibility from ``provide[ing]
commercial service to consumers or offer[ing] wholesale leasing
capacity of the network within the State except directly through
public-private partnerships for construction, maintenance, operation,
and improvement of the network within the State.'' \89\ This provision
could imply that such States are otherwise contemplated to provide
commercial services to non-consumers (e.g., public safety entities)
within that State. This interpretation, however, based on implication,
is not required by the provision, which could merely be formulated to
avoid precluding the intended use of the State RAN for service
provision by FirstNet to public safety. The implication may support the
flexibility discussed above, although Congress was express and overt
elsewhere in the Act in authorizing a customer-facing relationship.\90\
---------------------------------------------------------------------------
\89\ Id. Sec. 1442(g)(1).
\90\ We note that Section 6212 separately precludes FirstNet
from providing services directly to consumers, and such a
prohibition would presumably cover FirstNet's offer of services in a
State that has assumed responsibility for a RAN, raising the
question as to why the preclusion of Section 6302 is necessary
unless Congress assumed such States were customer-facing to public
safety entities. See 47 U.S.C. 1432, Sec. 1442. Because Congress
permitted such States to enter into agreements to exploit the excess
network capacity in such States, the Section 6302 provision serves
to limit the type of such agreements to the specified PPPs. Id.
Sec. 1442(g). Without this provision, States could enter into
agreements to exploit excess capacity where the paying party was not
aiding in the ``construction, maintenance, operation, and
improvement of the network.'' Id. Sec. 1442(g). Thus, the provision
can serve a separate purpose.
---------------------------------------------------------------------------
Section 6208 and Section 6302 expressly authorize FirstNet and a
State assuming RAN responsibilities, respectively, to enter into
CLAs.\91\ Only Section 6208, however, which authorizes ``[FirstNet] . .
. to assess and collect . . . fees,'' identifies ``user or subscription
fee[s] . . . including . . . from . . . any public safety entit[ies].''
\92\ That is, Congress expressly authorized both FirstNet and States to
enter into CLAs, but only expressly provided for FirstNet to charge
public safety entities for user or subscription fees. Because Congress
took the step of expressly authorizing the State to exploit federally-
licensed spectrum using one method (public private partnerships
(``PPPs'')/CLAs), and, unlike FirstNet, not another (subscriber fees),
a potential interpretation of the Act with respect to these provisions
is that FirstNet is intended to be the customer-facing service provider
for public safety entities in States that assume RAN responsibilities,
or is at least the only entity permitted to assess subscription fees to
public safety entities. Such an interpretation would also be supported
by the existence of provisions under the Act, more fully discussed
below, requiring FirstNet to reinvest subscriber fees as well as excess
network capacity fees into the network, whereas the only reinvestment
provision expressly applicable to States assuming RAN responsibilities
concerns excess network capacity fees. This too could indicate that
such States, as RAN providers, were not intended to assess subscription
fees because if they were intended to do so, Congress would have
required their reinvestment into the network (as they did with State
CLA fees).\93\
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\91\ Id. Sec. 1428(b), Sec. 1442(e)(3)(c)(i)(II).
\92\ See id. Sec. 1428.
\93\ 47 U.S.C. 1442(g)(2) (requiring revenues gained by a State
from such a leasing agreement to be reinvested in the network).
---------------------------------------------------------------------------
We preliminarily conclude, however, that although the above
provisions could indicate a Congressional intent to have FirstNet be
the primary customer-facing entity at least with regard to the fees
assessed public safety entities, a reasonable interpretation of all the
[[Page 13347]]
provisions discussed above, including both operational and fee-related,
would not preclude opt-out States, as sovereign entities, from charging
subscription fees to public safety entities if FirstNet and such States
agreed to such an arrangement in the spectrum capacity lease with the
States, and the arrangement was part of an alternative plan approved by
the FCC and NTIA. We seek comments on this preliminary conclusion.
In addition to affording flexibility with respect to FirstNet's
role, because of the lack of definitive language in the Act discussed
above, we also preliminarily conclude that the Act does not require
that such States be the customer-facing entity entering into agreements
with and charging fees to public safety entities in such States. In
particular, our conclusion is based on the absence of provisions in the
Act requiring such a result, as discussed above, and the inclusion of
provisions, such as those regarding the assessment and reinvestment of
subscriber fees, that at least clearly authorize, if not contemplate
the opposite result.
Accordingly, we preliminarily conclude that the Act provides
sufficient flexibility, as discussed above, to allow the determination
of whether FirstNet or a State plays a customer-facing role to public
safety in a State assuming RAN responsibilities to be the subject of
operational discussions between FirstNet and such a State in
negotiating the terms of the spectrum capacity lease for such State, in
addition to the approval of the State's alternative plan by the FCC and
spectrum leasing rights and any grant funds by NTIA. We seek comments
on these preliminary conclusions.
Our preliminary interpretations above attempt to maintain the
balance between, on the one hand, construction of a nationwide
architecture and interoperable operation of the network, and on the
other hand, a State's opportunity to design and deploy a RAN that meets
the particular coverage, capacity, and other needs of the State. Our
interpretations leave room for the flexibility advocated by some States
in response to our First Notice in order to provide the best solutions
in each State while adhering to the goals of the Act.
However, under all these possible scenarios--where an opt-out State
or FirstNet is playing customer-facing service provider roles to public
safety entities--the splitting of responsibilities for the network at
the interface between the RAN and core network will present substantial
operational complexities. A resale or MVNO-like arrangement permitting
States that assume RAN responsibilities to offer service to public
safety entities could create disparities in, among other things, terms
and conditions, service/feature offerings and availability, priority
and preemption governance schemes, and pricing and billing practices
between opt-out States and opt-in States. These disparities, in
addition to jeopardizing interoperability, could also reduce
subscription to and use of the NPSBN by adding complexity,
implementation risk, and confusion among public safety entities.
Although some of these disparities could be addressed in the opt-out
process and network policies implemented by FirstNet, and/or mitigated
in agreements between FirstNet and opt-out States, such a structure
could be inconsistent with the goals of the Act to establish ``a
nationwide, interoperable public safety broadband network . . . based
on a single, national network architecture.'' \94\
---------------------------------------------------------------------------
\94\ Id. Sec. 1422(b). There is also no indication in the Act
that the State option to assume RAN responsibilities was enacted to
promote competition between FirstNet and such States.
---------------------------------------------------------------------------
FirstNet's customer-facing role in providing services to public
safety entities in opt-out States, although potentially mitigating many
of the above difficulties, would present different issues, such as RAN
coverage and capacity planning, investment, and reimbursement debates
between FirstNet and such States.\95\ Under the variety of possible
scenarios enabled by commercial network standards, FirstNet and States
assuming RAN responsibilities will have to work together over many
years with the best interests of public safety in mind to address
myriad operational issues.\96\
---------------------------------------------------------------------------
\95\ We also note that States are not restricted from using
their own funds to build and operate the RAN, nor are they required
to apply to NTIA for funding.
\96\ For example, if FirstNet is the public safety customer-
facing provider, how will future capacity and coverage expansion of
the RAN be handled between the parties given that FirstNet sales and
service projections will be driving such investments? Alternatively,
if the State is the public safety customer-facing provider and wants
to expand the RAN or services beyond FirstNet's current core
configuration, how will those arrangements be handled? How will
roaming agreements between FirstNet and the State, and between
either FirstNet or the State (as the service provider) and other
carriers be handled? Regardless of the service provider model in
States assuming RAN responsibilities, how will radio frequency
planning be accomplished on State borders? We therefore also seek
comments on the operational parameters implicated in the shared
service provision models discussed above.
---------------------------------------------------------------------------
iii. State Use and Reinvestment of Funds Received From Building and
Operating a RAN
FirstNet has three primary sources of funding: (1) Up to $7 billion
in cash; (2) subscriber fees; and (3) fees from excess network capacity
leases (known as CLAs) that allow FirstNet to sell capacity not being
used by public safety to commercial entities.\97\ Each of these funding
sources is critical to offset the massive costs of the nationwide
broadband wireless network envisioned in the Act and the self-
sustainability required of FirstNet under the Act.
---------------------------------------------------------------------------
\97\ See generally 47 U.S.C. 1428, Sec. 1457.
---------------------------------------------------------------------------
State opt-out decisions could, however, depending on the
interpretations below, materially affect FirstNet's funding and thus
its ability to serve public safety, particularly in rural States. If a
State receives approval to opt-out it could theoretically tap into or
entirely supplant each of the three primary FirstNet funding sources
within the boundaries of the State. More precisely, depending on such
interpretations, a State that assumes RAN responsibility could tap into
or supplant these funding sources in an amount that materially exceeds
the amount of resources FirstNet (or a reasonable State plan) would
have allocated to serve that State.\98\
---------------------------------------------------------------------------
\98\ As used here, resources would be the amounts from all fees
(including subscriber and excess network capacity) used to cover
costs in the State. In an opt-out scenario, FirstNet would avoid the
costs of the RAN, gain core network fees, but potentially lose fees
that would have exceeded its costs in the State, as discussed
herein. FirstNet's purchasing power with vendors would also decline
to the extent of the RAN-related purchases, thereby potentially
raising FirstNet's costs to the extent of such reduced purchasing
power.
---------------------------------------------------------------------------
For example, once a State receives approval of its alternative RAN
plan from the FCC, the State must apply to NTIA for a spectrum capacity
lease from FirstNet.\99\ Section 6302(g) then permits a State to enter
into CLAs, using the spectrum capacity leased from FirstNet to offset
the costs of the RAN. The Act does not specify the terms governing the
lease nor the amount of spectrum capacity for which a State may apply,
only requiring any fees gained to be reinvested into the RAN ``of the
State.'' \100\ Assuming for the moment that such a State receives all
necessary approvals and enters into a lease with FirstNet for use of
all of FirstNet's spectrum capacity in the State, and such a State is
the billing service provider to public safety entities in the State,
then all public safety subscriber and excess network capacity fees
generated in the State would go to and remain in the
[[Page 13348]]
State other than any core network fees assessed by FirstNet.
---------------------------------------------------------------------------
\99\ 47 U.S.C. 1442(e)(3)(C).
\100\ Id. Sec. 1442(g)(2).
---------------------------------------------------------------------------
Generally speaking, States with high-density populations may
generate subscriber and/or excess network capacity fees for FirstNet
that materially exceed their RAN costs to FirstNet. Thus, if such a
State opts out of the FirstNet plan, and the Act is interpreted to
allow such States to keep any or all of the fees from such States that
exceed RAN costs within the State (assuming even an expanded RAN in the
State alternative plan relative to FirstNet's plan), then funding for
all other States could decline because FirstNet will not receive the
funding for use outside the State.\101\ That is, because FirstNet must
aggregate fee amounts across all States for reinvestment and use by all
States,\102\ if a State is able to withhold fees materially in excess
of those FirstNet was going to allocate to the State (beyond the
avoided cost of the RAN and core network fees, and accounting for any
plan differences between FirstNet and the State), funding for all other
States would materially decline. This circumstance could have a
detrimental impact on both the funds available to maintain and improve
the NPSBN on an ongoing basis as well as adversely affect the cost of
services to public safety users.
---------------------------------------------------------------------------
\101\ Funding for that opt-out State's core network would also
decline, but FirstNet would be able to assess such a State core
network fees under the Act.
\102\ See 47 U.S.C. 1428.
---------------------------------------------------------------------------
Thus, if a State believes it can generate and withhold such fees
for its own use under the Act, it may have at least a theoretical
economic incentive to opt-out. Again assuming the Act is interpreted
this way, our preliminary estimates indicate that very high density
States may have such an incentive, although only the request for
proposal processes and actual operations will determine this for
certain. Accordingly, if the Act is interpreted in this manner, it has
a built in incentive structure for a few States to opt-out and retain,
for reinvestment or otherwise in such States, fees that could
materially reduce FirstNet coverage and services in all other States,
including States with more rural areas.
We believe as a general matter that Congress did not intend for a
few, high-density States to be able to withhold material funding for
all other States under the Act. Such an incentive structure, even if
reinvestment in the State network were always required in opt-out
States, could result in networks that greatly exceed public safety
requirements in a few opt-out States (or funds diverted to State
general funds), and networks that do not meet public safety
requirements and the goals of the Act in the vast majority of States.
Nothing in the Act indicates that such a result was contemplated,
particularly given FirstNet's duty to ensure the deployment of a
``nationwide'' network that includes ``substantial rural coverage
milestones as part of each phase of the construction and deployment of
the network.'' \103\ We do not believe this was the balance Congress
intended to strike between establishing a nationwide network and
providing States an opportunity, under certain conditions, to customize
and operate the RAN portion of the network in their States.
---------------------------------------------------------------------------
\103\ Id. Sec. 1426(b)(1), (3).
---------------------------------------------------------------------------
Congress' intent in this regard is informed by, among others, the
provision in Section 6302(e)(3)(D) that requires that a State wishing
to assume RAN responsibilities demonstrate ``the cost-effectiveness of
the State plan'' when applying to NTIA not just for grant funds, but
also for spectrum capacity leasing rights from FirstNet, which are
necessary for the implementation of a State RAN and could exceed the
value of any grant funds over the life of the program.\104\ Independent
of NTIA's determination in assessing such an application, FirstNet, as
the licensee of the spectrum and an independent entity within NTIA,
must ultimately decide to enter into such a lease, and thus we analyze
this provision in considering FirstNet's role and duties in relation to
the State's proposed demonstration of the plan's ``cost-
effectiveness.'' \105\
---------------------------------------------------------------------------
\104\ See id. Sec. 1442(e)(3)(D).
\105\ We note that FirstNet's interpretation of this provision
and its determination with regard to its duties based on the State's
proposed demonstration is independent of and does not limit NTIA. To
the extent the ``spectrum capacity lease'' described in Section
6302(e)(3)(C)(iii)(II) is a lease of the spectrum itself, rather
than capacity on the network, under applicable FCC rules the FCC
``will allow parties to determine precise terms and provisions of
their contract'' consistent with FirstNet's obligations as a
licensee under such rules. See Promoting Efficient Use of Spectrum
Through Elimination of Barriers to the Development of Secondary
Markets, WT Docket No. 00-230, Report and Order and Further Notice
of Proposed Rulemaking, FCC 03-113, 18 FCC Rcd 20604, 20637 (2003).
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If a State presented a plan for a RAN deployment identical to
FirstNet's but costing three times as much, a reasonable interpretation
of this provision would indicate that if material, the amount in
question would render such a plan not cost-effective (assuming the
State was not using its own funds or otherwise compensating for the
cost difference). Two times the cost of the RAN would be wasted for the
rest of the country. This straight-forward analysis of cost-
effectiveness implicitly takes into account funding on a national
basis, beyond the border of the State in question, because the State
itself would receive the same RAN and the cost-inefficiency would only
affect other States through FirstNet. Thus, by including a cost-
effectiveness test, a straight-forward interpretation of the provision
would indicate Congress' intent that State opt-out decisions do not
unreasonably affect the resources of the network as a whole, or at the
very least that such decisions only allocate resources to provide
different or greater RAN coverage in a reasonable manner.\106\
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\106\ The actual analysis would presumably include any added
benefits provided by differences in the State RAN plan, which could
justifiably cost more than the FirstNet RAN plan. But material fees
captured in the State beyond the cost of even a reasonably enhanced
RAN plan could result in inefficiencies.
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In the case of a high-density State or territory, such as the
District of Columbia, the value of public safety user fees and CLAs is
likely much greater than a high-quality network's costs. That is, the
effective cost of the RAN once subscriber and/or excess network
capacity lease fees are taken into account is zero, and surplus fees
are generated. Assuming for the moment that the State could generate
the same (surplus) CLA fees that FirstNet could in the State, if the
State were to present a plan that withheld such surpluses in the State
itself, by analogy to the previous example, the rest of the States
would be denied the benefits to the NPSBN afforded by the availability
of such amounts to reduce the overall cost of services. Even if such a
surplus were reinvested in the State's network, spending the surplus on
only the network in that State may greatly exceed the reasonable needs
of public safety in the State relative to those in other States. In
addition to this inefficiency, if the Act were interpreted not to
require reinvestment (discussed below) then any surplus fees diverted
to State general funds would be drained from the FirstNet program and
public safety in all States, including the opt-out State.
Exacerbating this effect, a single State (or even a group of
States) negotiating a CLA for only such a State (or group) could yield
substantially lower fees overall relative to what FirstNet would have
generated. In the example above, the District of Columbia alone would
likely generate lower fees than FirstNet would for the spectrum in the
District because FirstNet would likely enter into a CLA that spanned
the entire metro area of Washington, DC, including parts of Maryland
and Virginia that, from a
[[Page 13349]]
commercial carrier's perspective, are important to the value of the
spectrum in the District. Furthermore, FirstNet's request for proposal
process might reveal that a regional or national CLA would generate
even greater fees attributable to the District (and the District with
surrounding States) because of the seamless spectrum footprint across
the region or nation. Of course, the opposite could also be true, that
for some reason a State or group of States may be able to generate more
fees from a CLA than FirstNet which, depending on the allocation of
such fees between the State and FirstNet, could benefit all other
States relative to the agreement into which FirstNet would have
entered. These are important considerations materially affecting the
value of the assets Congress provided to fund the program.
Accordingly, as a threshold matter, with respect to FirstNet's
negotiation of a spectrum capacity lease with States seeking to assume
RAN responsibilities, we preliminarily conclude that Congress did not
intend such leases to enable materially cost-inefficient RAN plans or,
more precisely, materially inefficient use of the scarce spectrum
resources provided to the program, and it would be FirstNet's duty to
consider the effect of any such material inefficiencies on, among other
things, more rural States and on the FirstNet program in determining
whether and under what terms to enter into such a lease.
The Act directs States with approved alternative RAN plans to
``apply'' to ``NTIA to lease spectrum capacity from [FirstNet].'' \107\
It does not guarantee that NTIA will approve spectrum capacity leasing
rights for a State, but rather sets out criteria that must be
demonstrated to NTIA--including the cost-effectiveness of the plan--
prior to receiving approval. FirstNet, however, as an independent
authority within NTIA and as the licensee of the spectrum, has a duty
to preserve the meaningful right of States to opt-out under the Act,
but also additional duties imposed by the Act to ensure the deployment
of the network nationwide and duties imposed by FCC rules as a licensee
with respect to the spectrum and any capacity subleases thereof. We
preliminarily conclude that FirstNet, in the exercise of such duties,
can and must take into account, among other things, the considerations
discussed above in whether and under what terms to enter into a
spectrum capacity lease with a State. We seek comments on this
preliminary conclusion.\108\
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\107\ 47 U.S.C. 1442(e)(3)(iii)(II).
\108\ We note that even if our preliminary conclusion is
incorrect in terms of FirstNet's authority to consider the effects
discussed above, in any event the provisions regarding cost-
effectiveness of the plan, as interpreted by NTIA, would
nevertheless be a required consideration in the application to NTIA
for spectrum capacity leasing rights under the Act.
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FirstNet's proposed approach, however, would not result in a binary
FirstNet position. FirstNet, in remaining faithful to the balance
Congress struck in the Act, would work with States desiring to assume
RAN responsibilities to evaluate potential ``win-win'' arrangements
where the assets Congress provided are used efficiently but the right
of States to assume RAN responsibilities under the Act's criteria is
preserved. For example, FirstNet and such a State could agree, as part
of the spectrum capacity lease and ultimately as part of the State's
alternative plan presented to the FCC and NTIA, to leverage a FirstNet
CLA if it presents a materially better fee return to the benefit of
both the State in question and all other States. Such a State could
become a contracting party with the same covered leasing partner,
giving the State control of and responsibility for the RAN. If, taking
into account the above-discussed potential effects on the program, a
State is nevertheless able to enter into a more favorable CLA with a
different covered leasing partner, then FirstNet and the State could
agree on how such an agreement would benefit the State and the network
as a whole. A variety of approaches could achieve ``win-win''
solutions, and FirstNet would be committed to exploring them within the
bounds of the Act. We seek comments on such approaches.
With respect to the user fees generated from public safety
customers in a State, we discussed in the previous section of this
Second Notice our preliminary conclusion that FirstNet or a State
assuming RAN responsibilities may ultimately receive such fees
depending on the arrangement between FirstNet and the State under the
spectrum capacity lease. Here, for the reasons discussed above, we
preliminarily conclude that the Act should be interpreted to require
that States assuming RAN responsibilities that charge end user
subscription fees to public safety entities must reinvest such fees
into the network and that FirstNet has a duty to consider both the
reinvestment of such fees and the cost-effectiveness considerations
discussed above regarding the distribution of such fees in entering
into such a spectrum capacity lease.
An alternative interpretation regarding reinvestment of subscriber
fees--that Congress intended States to be able to divert such fee
amounts to State general funds--would seem to have no basis in the
structure and purposes of the Act, which carefully provides a
reinvestment requirement for CLA fees assessed by States (and FirstNet)
and when authorizing subscriber fees by FirstNet.\109\ Subscriber fees
may ultimately exceed those derived from CLAs in any one State, and it
would make little sense for Congress to have intended loss of the
former but retention of the latter for the network, with such losses
potentially jeopardizing the interoperability and technical evolution
of the network. At a minimum, the ability of States to provide end user
services to public safety entities will ultimately depend on the scope
of the spectrum capacity lease provided by FirstNet. Accordingly, we
preliminarily conclude that, absent clear language to the contrary in
the Act, FirstNet could impose such a reinvestment restriction within
the terms of such a lease. We seek comments on these preliminary
conclusions.
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\109\ This would be true even if Congress assumed that some of
such subscribers could be receiving services for free because the
same assumption could have been made with respect to FirstNet fees.
That is, the Act does not require the imposition of fees, only
authorizes such fees, and then requires that, if assessed, any such
fees be reinvested.
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We also preliminarily conclude here that, for the reasons discussed
above related to CLAs, FirstNet, in the exercise of its duties, can and
must take into account, among other things, the considerations
discussed above regarding the effects on other States of a State's plan
to retain all subscriber fees in determining whether and under what
terms to enter into a spectrum capacity lease with a State. Consistent
with our proposed approach to efficiently leverage CLA fees from third
parties, FirstNet would explore ``win-win'' solutions with States
desiring to assume RAN and customer-facing obligations if subscriber
fees with or without CLA fees would materially exceed RAN and related
costs in a State. We seek comments on these preliminary conclusions.
We turn now to the interpretation of certain aspects of provisions
addressing the reinvestment of CLA fees assuming that a State has
received approval from NTIA and entered into a spectrum capacity lease
with FirstNet. We note the parallels between FirstNet and the State's
provisions addressing the reinvestment of fees. Subsection 6208(d)
requires FirstNet to reinvest those
[[Page 13350]]
amounts received from the assessment of fees under Section 6208 in the
NPSBN by using such funds only for constructing, maintaining,
operating, or improving the network.\110\ Such fees under Section 6208
include basic network user fees and fees related to any CLAs between
FirstNet and a secondary user.\111\
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\110\ 47 U.S.C. 1428(b).
\111\ See id. Sec. 1428(a).
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Parallel to FirstNet's provision in Section 6208(d), Section
6302(g)(2) requires that any amounts gained from a CLA between a State
conducting its own deployment of a RAN and a secondary user must be
used only for constructing, maintaining, operating, or improving the
RAN of the State.\112\ However, the exact parallels between the
reinvestment prohibitions in the Act applicable to FirstNet, and those
applicable to such States, end there.
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\112\ Id. Sec. 1442 (g)(2) (emphasis added).
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Section 6208(a)(2) authorizes FirstNet to charge lease fees related
to CLAs. Other than CLAs, however, FirstNet is not expressly authorized
to enter into other arrangements involving the sale or lease of network
capacity. In potential contrast, Section 6302(g)(1) precludes States
from providing ``commercial service to consumers or offer[ing]
wholesale leasing capacity of the network within the State except
directly through public-private partnerships for construction,
maintenance, operation, and improvement of the network within the
State.'' Section 6302(g)(2), entitled ``Rule of construction,''
provides that ``[n]othing in this subsection shall be construed to
prohibit the State and a secondary user from entering into a covered
leasing agreement.'' \113\
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\113\ Id. Sec. 1442(g)(1).
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These two components of subsection 6302(g) raise questions as to
whether (1) there is any type of PPP that is not a CLA, and if so, (2)
whether such a PPP would permit commercial use of such capacity more
flexibly or less flexibly than a CLA given the difference in their
respective requirements. That is, do these provisions of the Act
provide States that assume RAN responsibility more or less flexibility
in wholesaling capacity than FirstNet? Moreover, if such a non-CLA PPP
exists, under the second sentence of Section 6302(g)(2), amounts
generated by such an arrangement, unlike those from a CLA, could under
the literal terms of Section 6302(g)(2) potentially not be subject to
reinvestment in the network as that provision states that it is
revenues gained ``from such a leasing agreement'' (ostensibly referring
to ``covered leasing agreement'' in the immediately preceding sentence)
that must be reinvested.\114\
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\114\ We note, however, that the reinvestment requirement of
Section 6302(g)(2) actually requires reinvestment in ``constructing,
maintaining, operating, or improving'' the RAN in the State, which
are the four items listed as the subject matter of the PPPs of
Section 6302(g)(1), not the CLA items of Section 6208(a)(1), which
are ``construct[ing], manag[ing], and operat[ing].'' See 47 U.S.C.
1442(g), Sec. 1448(a)(1). If Congress had intended to require only
reinvestment of CLA fees, they may have referenced only the three
areas that are the subject of CLAs. An alternative interpretation
could therefore be that ``such a leasing agreement'' of Section
6302(g)(2) refers back to the term ``wholesale leasing'' in Section
6302(g)(1), using the term ``agreement'' as a generic reference to
the PPP. We seek comments on this alternative interpretation. See
id. Sec. 1442(g)(2), Sec. 1442(g)(1).
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These potential differences between the Act's treatment of FirstNet
and States with regard to capacity leases turn on whether Congress
intended a difference between the definition of CLA, explored in the
First Notice, and a ``public-private partnership for construction,
maintenance, operation, and improvement of the network.'' There are
several differences in statutory language between the two:
(1) CLAs must be a written agreement, whereas PPPs are not
expressly required to be in writing;
(2) CLAs are ``arrangements'', whereas PPPs are
``partnerships'';
(3) PPPs must include ``improvement'' of the network in addition
to the ``construction'' and ``operation'' of the network required by
both CLAs and PPPs;
(4) CLAs must include the ``manage[ment]'' of the network
whereas PPPs must include the ``maintenance'' of the network; and
(5) PPPs need not expressly permit (i) access to network
capacity on a secondary basis for non-public safety services and
(ii) the spectrum allocated to such entity to be used for commercial
transmissions along the dark fiber of the long-haul network of such
entity.
We believe, however, that in practical terms the differences in
items (1)-(4) above are slight. For example, any significant agreement
of this type is likely to be in writing, and most such agreements could
include improvement, management, or maintenance of the network in some
manner to qualify.
With regard to item (5) above, interpreted consistent with our
preliminary conclusions in the First Notice, these ``permit[ted]'' uses
could provide express flexibility to a CLA party but not a PPP.
Nevertheless, Section 6302(g)(2) permits States to enter into CLAs,
indicating an intent to include CLAs within the scope of PPPs.\115\ We
thus preliminarily conclude that, in practical effect, the literal
statutory differences result in little difference between the Act's
treatment of FirstNet and States that assume RAN responsibility. We
seek comments on this preliminary conclusion.
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\115\ If the item (5) ``permit[ed]'' uses were interpreted as
limitations on a CLA partner, which we preliminarily concluded in
the First Notice was not the case, then Section 6302(g)(2) would
have the strange result of requiring reinvestment of a narrower
class of capacity leases but not broader, more flexible leases. 47
U.S.C. 1442(g)(2). This interpretation makes little sense under the
framework of the Act, would permit the draining of one of the most
important sources of funding away from State RANs, and thus we
preliminarily conclude that Section 6302(g)(2) and the definition of
CLAs should not be interpreted in this manner. Id.
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Given this preliminary conclusion, we do not believe Congress
intended to permit such States to avoid reinvestment in the network
through use of subtle differences in network capacity arrangements.
Nothing in the Act indicates that such subtle differences should
justify driving scarce resources away from the network and thus,
effectively, public safety entities. Nor does anything in the Act
indicate that Congress intended the network to be even a partial
revenue generator for States. Given the provisions of and overall
framework and policy goals of the Act, we preliminarily conclude that
Congress intended that any revenues from PPPs, to the extent such
arrangements are permitted and different than CLAs, should be
reinvested into the network and that the reinvestment provision of
Section 6302(g) should be read to require as such.\116\ We seek
comments on this preliminary conclusion.
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\116\ Id. Sec. 1442(g)(2).
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Notwithstanding our preliminary legal conclusions above, however,
fees--either basic user fees or those from PPPs--used for purposes
other than constructing, maintaining, operating, or improving the RAN
in a State could potentially severely impact the ability of a State to
maintain ongoing interoperability and/or maintain comparable security,
coverage, and quality of service to that of the NPSBN over time.
Accordingly, we believe the potential loss to the network of either of
these revenue streams, and thus State commitments to reinvest such
revenue streams if the final interpretation of Section 6302(g) permits
such losses, could be considered by NTIA in assessing any State
alternate plans and related demonstrations by a State, and could be the
subject of negotiated terms in any spectrum capacity lease between
FirstNet and such a State in accordance with our preliminary
conclusions regarding such leases above.
[[Page 13351]]
III. Ex Parte Communications
Any non-public oral presentation to FirstNet regarding the
substance of this Second Notice will be considered an ex parte
presentation, and the substance of the meeting will be placed on the
public record and become part of this docket. No later than two (2)
business days after an oral presentation or meeting, an interested
party must submit a memorandum to FirstNet summarizing the substance of
the communication. FirstNet reserves the right to supplement the
memorandum with additional information as necessary, or to request that
the party making the filing do so, if FirstNet believes that important
information was omitted or characterized incorrectly. Any written
presentation provided in support of the oral communication or meeting
will also be placed on the public record and become part of this
docket. Such ex parte communications must be submitted to this docket
as provided in the ADDRESSES section above and clearly labeled as an ex
parte presentation. Federal entities are not subject to these
procedures.
Dated: March 9, 2015.
Stuart Kupinsky,
Chief Counsel, First Responder Network Authority.
[FR Doc. 2015-05855 Filed 3-12-15; 8:45 am]
BILLING CODE 3510-TL-P
