Facilitating Shared Use in the 3100-3550 MHz Band, 78573-78579 [2022-27820]

Agencies

• FEDERAL COMMUNICATIONS COMMISSION

[Federal Register Volume 87, Number 245 (Thursday, December 22, 2022)]
[Rules and Regulations]
[Pages 78573-78579]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-27820]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Parts 1, 2 and 27

[WT Docket No. 19-348; DA 22-1188; FR ID 116794]


Facilitating Shared Use in the 3100-3550 MHz Band

AGENCY: Federal Communications Commission.

ACTION: Final action.

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SUMMARY: In this document, the Wireless Telecommunication Bureau 
(Bureau) selects the four entities that will represent the interest of 
the new entrants to the 3.45-3.55 GHz band in selecting the 
Reimbursement Clearinghouse. The four entities selected are 
NBCUniversal, Nexstar Broadcasting (Nexstar), CTIA-The Wireless 
Association (CTIA), and the Competitive Carriers Association (CCA). In 
addition, the Bureau adopts certain requirements regarding the 
Clearinghouse search committee process and the operation of the 
Clearinghouse. These requirements support the prevention of waste, 
fraud, and abuse in the handling of reimbursement funds and will 
protect confidential information.

DATES: This final agency action is effective January 23, 2023.

ADDRESSES: Federal Communications Commission, 45 L Street NE, 
Washington, DC 20554.

FOR FURTHER INFORMATION CONTACT: Morgan Mendenhall, Wireless 
Telecommunications Bureau, Mobility Division, (202) 418-0154 or 
[email protected]. For information regarding the Paperwork 
Reduction Act information collection requirements, contact Cathy 
Williams, Office of Managing Director, at 202-418-2918 or 
[email protected].

SUPPLEMENTARY INFORMATION: This summary of the 3.45 GHz Clearinghouse 
Order in WT Docket No. 19-348, DA 22-1188, adopted and released 
November 10, 2022. The full text of the 3.45 GHz Clearinghouse Order, 
including all Appendices, is available for public inspection at the 
following internet address: https://docs.fcc.gov/public/attachments/DA-22-1188A1.pdf. Alternative formats are available for people with 
disabilities (Braille, large print, electronic files, audio format), by 
sending an email to [email protected] or calling the Consumer and 
Governmental Affairs Bureau at 202-418-0530 (voice) or 202-418-0432 
(TTY).

Final Regulatory Flexibility Analysis

    The Regulatory Flexibility Act of 1980, as amended (RFA), requires 
that an agency prepare a regulatory flexibility analysis for notice and 
comment rulemakings, unless the agency certifies that ``the rule will 
not, if promulgated, have a significant economic impact on a 
substantial number of small entities.'' 5 U.S.C. 605(b). Accordingly, 
the Commission has prepared a Final Regulatory Flexibility Analysis 
(FRFA) concerning the possible impact of the rule changes contained in 
the 3.45 GHz Band Second Report and Order (R&O) (86 FR 17920, April 7, 
2021) on small entities. As required by the RFA, an Initial Regulatory 
Flexibility Analysis (IRFA) was incorporated in the Further Notice of 
Proposed Rulemaking (FNPRM) released in October 2020 in this proceeding 
(85 FR 66888, October 21, 2020). The Commission sought written public 
comment on the proposals in the FNPRM, including comments on the IRFA. 
No comments were filed addressing the IRFA. This FRFA conforms to the 
RFA. The Commission will send a copy of the 3.45 GHz Clearinghouse 
Order, including the FRFA, to the Chief Counsel for Advocacy of the 
Small Business Administration.

Paperwork Reduction Act

    This document contains new or modified information collection 
requirements subject to the Paperwork Reduction Act of 1995, Public Law 
104-13. In addition, it contains new or modified information collection 
burden for small business concerns with fewer than 25 employees, 
pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 
107-198, see 44 U.S.C. 3506(c)(4).

Congressional Review Act

    The Commission will send a copy of the 3.45 GHz Clearinghouse Order 
(Order) to Congress and the Government Accountability Office pursuant 
to the Congressional Review Act, see 5 U.S.C. 801(a)(1)(A).

Synopsis

I. Introduction

    With this final action, the Wireless Telecommunications Bureau 
(Bureau) identifies four entities that will form a search committee to 
select a Reimbursement Clearinghouse (Clearinghouse) to oversee the 
reimbursement of relocation expenses for certain secondary, non-Federal 
radiolocation licensees in the 3.45-3.55 GHz band (3.45 GHz band). 
These entities are NBCUniversal, Nexstar Broadcasting (Nexstar), CTIA, 
and the Competitive Carriers Association (CCA). In addition, the Bureau 
adopts certain requirements regarding the Clearinghouse search 
committee process and the operation of the Clearinghouse. These 
requirements support the prevention of waste, fraud, and abuse in the 
handling of reimbursement funds and will protect confidential 
information.

II. Background

    In the 3.45 GHz Band Second R&O, the Commission adopted rules to 
make 100 megahertz of mid-band spectrum available for flexible use 
throughout the contiguous United States. To facilitate this goal, the 
Commission previously had determined that secondary, non-Federal 
radiolocation licensees in the band would be relocated to the 2.9-3.0 
GHz band. In the 3.45 GHz Band Second R&O, the Commission further 
determined that secondary, non-Federal radiolocation authorizations 
would sunset 180 days after new 3.45 GHz Service licenses are granted 
in the band. Because these licenses were granted on May 4, 2022, the 
non-Federal radiolocation authorizations sunset on October 31, 2022. In 
addition, the Commission in the 3.45 GHz Band Second R&O required ``new 
flexible-use licensees in the 3.45 GHz Service to reimburse secondary, 
non-federal radiolocation licensees for reasonable costs related to the 
relocation of those

[[Page 78574]]

operations to the 2.9-3.0 GHz band, including the costs of a relocation 
clearinghouse's administration of the reimbursement.'' 36 FCC Rcd 5987, 
6042, para 155 (2021), 86 FR 60775 . Specifically, each new 3.45 GHz 
Service licensee will be responsible for reimbursement of a pro rata 
share of reasonable relocation costs of non-Federal radiolocation 
operations.
    The Commission in the 3.45 GHz Band Second R&O delegated authority 
to the Bureau, working in coordination with the Office of the Managing 
Director, to develop and implement a clearinghouse selection process 
similar to the process used in the 3.7 GHz proceeding. The Commission's 
delegation also included the authority to seek notice and comment on 
the parameters of additional considerations that should inform the 
creation and administration of the cost-sharing plan to help implement 
the Commission's decision and, if necessary for the purposes of the 
more limited relocation in the 3.45 GHz Service, to adjust the 
procedures adopted in the 3.7 GHz proceeding to tailor them to the 
relocation in the 3.45 GHz proceeding. As in the 3.7 GHz proceeding, 
the Commission in the 3.45 GHz Band Second R&O provided for the 
creation of a neutral, independent clearinghouse to oversee the 
collection and distribution of relocation reimbursement payments from 
new 3.45 GHz Service licensees to non-Federal secondary radiolocation 
incumbents. Unlike in the 3.7 GHz context, however, in the 3.45 GHz 
proceeding, the Commission did not identify the specific industry 
stakeholders who would compose the search committee to select the 
Clearinghouse.
    On August 20, 2021, the Bureau released a Public Notice (Search 
Committee Public Notice) seeking comment on the selection process for, 
and operation of, the Clearinghouse. Comments and replies were due on 
September 30, 2021, and October 12, 2021, respectively (86 FR 51335, 
September 15, 2021). The Bureau received comments from Nexstar, 
NBCUniversal, and CTIA; a reply from the Wireless Infrastructure 
Association (WIA); and a subsequent ex parte letter from CCA.

III. Discussion

A. Composition of the Clearinghouse Search Committee

    As noted above, the Commission delegated authority to the Bureau to 
implement a clearinghouse selection process similar to the process used 
in the 3.7 GHz band transition. In the 3.7 GHz proceeding, the 
Commission determined that the clearinghouse search committee would be 
composed of nine members appointed by nine entities that the Commission 
found, collectively, reasonably represented the interests of the 
stakeholders in the 3.7 GHz band transition. These entities represented 
incumbents in the band (space station operators--three entities, and 
earth station operators--three entities) as well as prospective 
flexible-use licensees (three entities). The Commission determined that 
the range of entities it had chosen would fairly represent the broad 
interests of the relevant stakeholders in the 3.7 GHz band transition. 
Since the clearinghouse search committee was not similarly identified 
in the 3.45 GHz Band Second R&O, the Bureau sought comment on the 
optimal number of members and which appropriate industry stakeholders 
should be included on the search committee for the 3.45 GHz band 
transition.
    NBCUniversal and Nexstar, the two secondary, non-Federal incumbents 
in the 3.45 GHz band, both seek representation on the search committee. 
Due to the difference between the use and size of their operations, 
NBCUniversal and Nexstar favor each company having its own seat, rather 
than a shared incumbent representative. Similarly, CTIA volunteered to 
represent traditional wireless providers on the search committee. CTIA 
also acknowledged the need for another representative to advocate for 
new entrants in the band that would not be covered by its own 
membership. WIA likewise supported representation for both small- and 
large-market new entrants, in addition to incumbents, suggesting two 
seats for the incumbents and two for new entrants to represent small 
and large auction winners. Although CCA did not initially file comments 
in this portion of the proceeding, CCA has since indicated an interest 
in serving on the search committee to represent the small-market 
segment of new entrants.
1. Representation of Interests
    The Bureau finds that equal representation of both interest groups 
present in the instant transition--incumbent radiolocation systems and 
new-entrant flexible-use licensees--is both consistent with the 3.7 GHz 
band transition and will ensure a fair and transparent Clearinghouse 
selection process in this proceeding. Specifically, each interest group 
will have two seats: two incumbent seats to represent NBCUniversal's 
and Nexstar's differing business models, and two new-entrant seats to 
represent both small- and large-market flexible-use licensees.
    First, the Bureau finds that equal representation of both interest 
groups is consistent with the approach used in the 3.7 GHz band 
proceeding. There, the search committee was comprised of nine members 
representing three distinct interest groups: incumbent space station 
operators, incumbent earth station operators, and prospective flexible-
use licensees. Each interest group received three representatives on 
the search committee, which included seats for smaller and larger 
interests within each interest group segment. The corollary of the 3.7 
GHz band approach here is thus equal representation of the two interest 
groups in the 3.45 GHz transition: non-Federal radiolocation incumbents 
and new entrants, with two seats on each side. The Bureau agrees with 
WIA that new entrants are a diverse group that would be best served by 
representatives for both smaller and larger new entrants.
    Second, the Bureau finds that equal representation will foster 
compromise. By having equal representation from both interest groups on 
the search committee, no one group can act unilaterally in the 
selection process, ensuring that the resulting Clearinghouse fairly 
facilitates the transition process. WTB agreed with WIA that having 
equal representation for both interest groups on the search committee 
will provide ``confidence that the clearinghouse selected remains 
impartial and will seek an equitable outcome for all the parties 
involved in the relocation.''
    While this approach deviates from our proposal in the Search 
Committee Public Notice to have an odd number of members on the search 
committee, the Bureau sought comment on the optimal number of members 
to include on the search committee. Further, the Bureau specifically 
recognized that the 3.45 GHz relocation would be less complex than that 
in the 3.7 GHz band, and suggested that a smaller committee might be 
more efficient. The Bureau finds that a search committee comprised of 
four members, two incumbent representatives and two new entrant 
representatives, will accurately reflect the interests present in the 
3.45 GHz band, is responsive to suggestions raised by commenters, and 
is well-positioned to facilitate compromise. In the event that equal 
representation leads to deadlock despite our instruction to proceed by 
consensus, the search committee shall inform the Bureau and the Bureau 
may then consider additional measures, including resolution by majority 
vote or

[[Page 78575]]

appointment of an additional search committee member. The Bureau shall 
act on such request within 30 days, and the search process shall 
continue consistent with this final action and the Commission's rules.
    The Bureau disagrees with Nexstar that the approach most consistent 
with the 3.7 GHz band process would be to have two-thirds of the search 
committee seats here represented by incumbent interests. While two-
thirds of the 3.7 GHz band search committee was comprised of 
incumbents, the incumbent space station operators and earth station 
operators represent distinct industry segments. For example, in the 3.7 
GHz band space station operators provide downlink signals to various 
types of earth stations, and the earth station operators in turn 
deliver programming to television and radio broadcasters and telephone 
and data services to consumers. Each incumbent group was given its own 
equal representation on the 3.7 GHz band search committee to reflect 
the differences in their interests with respect to the transition 
process. The Bureau applies the same logic here, and thus have 
designated equal representation of both the incumbent and new entrant 
interest groups in the 3.45 GHz band.
1. Number of Seats and Membership
    As discussed above, the Bureau finds that here the appropriate 
implementation of equal representation is two search committee seats 
for the incumbents and two for the new entrants. Specifically, the 
Bureau finds that the four-member Clearinghouse search committee will 
be comprised of representatives from NBCUniversal, Nexstar, CTIA, and 
CCA. As proposed in the Search Committee Public Notice, each entity 
shall nominate one individual to serve on the search committee. WIA, 
the commenter to most directly address this issue, supports this 
process, and states that such representation will promote confidence 
that the selected clearinghouse will be fair to all parties in the 
transition.
    NBCUniversal and Nexstar, both of which volunteered to be on the 
search committee, will represent their own respective interests as 
secondary incumbent radiolocation service users. The Bureau finds that 
CTIA and CCA together will best represent the interests of new entrants 
given their diverse memberships. CTIA, which also volunteered to be on 
the search committee, will represent the larger- new entrant interests 
to the band. CCA indicated an interest in serving on the search 
committee and will represent the interests of smaller and rural 
entities.
    The Bureau finds that CCA is best positioned to serve as the second 
new-entrant representative on the search committee. The Bureau agrees 
with WIA that the new entrants' interests are diverse and that it is 
important to have the interests of smaller and rural providers 
represented on the search committee. CCA notes that its members include 
``small, rural carriers serving fewer than 5,000 customers'' and also 
indicates that some of its members are license winners in the 3.45 GHz 
band. Thus, the Bureau finds that CCA is well-situated to represent the 
smaller and rural new entrants in the band.

B. Search Committee's Selection of the Clearinghouse

    In the 3.7 GHz proceeding, the Commission directed the search 
committee to proceed by consensus, but noted that if a vote on the 
selection of a clearinghouse was required, it would be by a majority 
vote. Likewise here, as proposed in the Search Committee Public Notice, 
the Bureau directs the search committee to proceed by consensus. In the 
event of deadlock, however, the Bureau directs the search committee to 
notify the Bureau. As noted above, in the event of deadlock under the 
current composition, the search committee shall inform the Bureau and 
the Bureau may then consider additional measures to resolve the 
deadlock. Further, the Bureau shall act on such request within 30 days 
of the search committee's request, and the search process shall 
continue consistent with the Commission's rules.
    The Bureau requires each search committee member to certify that 
they have reviewed and understand the Commission's rules and 
requirements contained in this final action and the 3.45 GHz Band 
Second R&O. Such certifications must be filed in the docket of this 
proceeding prior to the first meeting of the selection committee, but 
no later than January 5, 2023. In the event that a new search committee 
member is added, its certification must be filed in the docket of this 
proceeding no later than 30 days after the Bureau releases a Public 
Notice identifying the new search committee member.
    The search committee must meet no later than January 5, 2023. In 
addition, by March 6, 2023, the search committee must release and file 
with the Bureau a Request for Proposal (RFP), or similar solicitation 
for Clearinghouse applications. Such solicitation must explain in 
detail the selection criteria for the position of Clearinghouse and 
must be consistent with the qualifications, roles, and duties of the 
Clearinghouse as set forth in the Commission's rules and this final 
action. Entities responding to the RFP must describe how they will 
comply with these criteria and rules adopted by the Commission. The 
search committee should ensure that the Clearinghouse meets the 
relevant best practices and standards in its operation to ensure an 
effective and efficient transition.
    Thus, at a minimum, the search committee's solicitation for the 
Clearinghouse must include the following requirements to: (1) engage in 
strategic planning and adopt goals and metrics to evaluate its 
performance; (2) adopt internal controls for its operations; (3) use 
enterprise risk management practices; and (4) use best practices to 
protect against improper payments and to prevent fraud, waste, and 
abuse in its handling of funds. In addition, the Clearinghouse must be 
required to create written procedures for its operations, using the 
Government Accountability Office's (GAO) Green Book to serve as a guide 
in satisfying such requirements.
    CTIA asks that the selected Clearinghouse be required to enter into 
contracts with stakeholders--i.e., with incumbents and new entrants. 
CTIA explains that ``contracts between new 3.45 GHz Service licensees 
and the Clearinghouse help ensure that the Clearinghouse's management 
of clearing funds has appropriate oversight.'' CTIA notes, however, 
that requiring contracts between the Clearinghouse and all stakeholders 
may stall the reimbursement process if some parties are hold outs 
because they lack the incentives to undertake the cost of negotiating a 
contract, which could significantly exceed their reimbursement 
liability. Instead, CTIA maintains that ``appropriate oversight of the 
Clearinghouse can be assured by confirming that licensees covering some 
reasonable proportion of the total relocation liability have negotiated 
contracts with the Clearinghouse.'' In addition, CTIA proposes that 
``the Clearinghouse should be required to contract with any licensee 
that so desires on terms and conditions that are materially the same as 
those negotiated by other licensees.''
    The Bureau believe this proposal has merit and will require such 
contracts here. Thus, the Bureau requires the Clearinghouse to enter 
into contracts with both incumbents and sufficient licensees that hold 
the majority of 3.45 GHz Service licenses. The Bureau notes that while 
contracts were not required in the 3.7 GHz band context, that framework 
``expected'' that contracts

[[Page 78576]]

would be entered into between the selected Clearinghouse and the 
stakeholders. Accordingly, the Bureau finds that it is both consistent 
with past precedent and appropriate here to require the Clearinghouse 
to enter into contracts with the two incumbents and a sufficient number 
of new entrant licensees holding the majority of 3.45 Service licenses.
    In addition, the Clearinghouse must enter into a contract with any 
licensee that so requests on terms and conditions that are materially 
the same as those negotiated by other licensees. To this end, the 
Bureau requires the search committee to include a requirement in its 
RFP or other similar solicitation document that the selected 
Clearinghouse will be required to enter into contracts with 
stakeholders based on and consistent with the Commission's rules and 
this final agency action, the terms of the RFP, and the applicant's 
responses to the RFP, as described herein. Further, as part of its 
response to the RFP, the Clearinghouse selectee must affirmatively 
represent that it will enter into such contracts with two incumbents 
and a sufficient number of new entrant licensees holding the majority 
of 3.45 Service licenses.
    The Bureau notes that CTIA also asks that such contracts ``be on 
based on commercially reasonable terms for fiduciaries acting in the 
capacity of the 3.45 GHz Clearinghouse'' and that the Clearinghouse 
recognize ``that it owes fiduciary duties to both incumbents and new 
entrants.'' The Bureau believes that requiring contracts between the 
Clearinghouse and licensee stakeholders has merit in the context of 
this proceeding, and such contractual relationships and obligations 
will provide appropriate safeguards. Thus, the Bureau does not need to 
reach a decision on CTIA's request for imposing a fiduciary duty.
    The search committee's solicitation shall also require that the 
Clearinghouse adopt robust privacy and data security best practices in 
its operations, given that it will receive and process information 
critical to ensuring a successful and expeditious transition. The 
Clearinghouse shall therefore also comply with, on an ongoing basis, 
all applicable laws and Federal Government guidance on privacy and 
information security requirements such as relevant provisions in the 
Federal Information Security Management Act (FISMA), National Institute 
of Standards and Technology (NIST) publications, and Office of 
Management and Budget guidance. The Clearinghouse must hire a third-
party firm to independently audit and verify, on an annual basis, the 
Clearinghouse's compliance with privacy and information security 
requirements and to provide recommendations based on any audit 
findings; to correct any negative audit findings and adopt any 
additional practices suggested by the auditor; and to report the 
results to the Bureau annually beginning April 1, 2024.
    The Bureau will issue a Public Notice notifying the public that the 
search committee has published criteria for the selection of the 
Clearinghouse. The Public Notice will announce a closing date of April 
2, 2023 for submission of responses to the RFP.
    The search committee shall notify the Bureau of its tentative 
choice for the Clearinghouse by May 2, 2023. This notification shall: 
(1) be contingent on the selectee's agreement to enter into contracts 
with incumbent and new, flexible-use licensee stakeholders prior to 
finalization of the selection; (2) fully disclose any actual or 
potential organizational or personal conflicts of interest or 
appearance of such conflict of interest of the Clearinghouse or its 
officers, directors, employees, and/or contractors; and (3) set out in 
detail the salary and benefits associated with each position. The 
Clearinghouse shall have an ongoing obligation to update this 
information as soon as possible after any relevant changes are made.
    Once the search committee has notified the Bureau of its tentative 
selection, the selectee must negotiate one or more contracts with 
stakeholder licensees. Specifically, by July 3, 2023, the selectee must 
submit negotiated and executed contracts to the search committee. The 
contracts should be consistent with the requirements of this final 
agency action and the Commission's rules, the RFP, and the selectee's 
RFP responses. Such contracts should address issues such as any 
limitations on liability, audits, and any such other commercially 
reasonable terms as may be expected to be included in contracts of this 
nature. After submission of contracts to the search committee, the 
search committee must review the contracts for compliance with the 
Commission's rules, the RFP, and the selectee's proposal by August 1, 
2023. If the search committee determines contracts are in compliance, 
the search committee will notify the Bureau that it has finalized the 
selection of the Clearinghouse and will submit copies of the selectee's 
RFP response and contracts in the docket. The Bureau acknowledges that 
requiring contracts for all 3.45 GHz Service licensees to be executed 
prior to the finalization of the Clearinghouse selectee may unduly 
delay the selection process. Thus, if the search committee has 
determined that the submitted contracts are in compliance and such 
contracts have been submitted for both incumbents and sufficient 
licensees that hold the majority of 3.45 GHz Service licenses, the 
search committee may submit the Clearinghouse selectee for final 
confirmation by the Bureau.
    After receipt of the search committee's notification of its final 
selection, the Bureau will issue a Public Notice announcing the entity 
selected and inviting public comment on whether the selectee satisfies 
the criteria set out in this final agency action and in the 
Commission's rules. Following the comment period and submission of the 
RFP response and contracts in the docket, the Bureau will issue a 
determination as to whether the criteria for the Clearinghouse either 
have or have not been satisfied. Should the Bureau be unable to find 
the criteria have been satisfied, the selection process will start over 
and the search committee will submit a new proposed entity. The search 
committee shall remain in place at least until the Bureau issues its 
determination confirming the selection of the Clearinghouse.
    In the event that: (1) the Clearinghouse selectee has not reached 
agreement with the two incumbent radiolocation service licensees and 
sufficient licensees that hold the majority of 3.45 GHz Service 
licenses; (2) the Bureau determines that the submitted contracts do not 
comply with the relevant requirements; or (3) the Bureau determines 
that the Clearinghouse selectee has otherwise not satisfied the 
selection criteria, the Bureau may in its discretion elect to give the 
parties 30 days to cure such noncompliance or instruct the search 
committee to reconvene and select a new Clearinghouse candidate, thus 
restarting the above process.

C. Clearinghouse Selection Process Deadlines

    Consistent with the terms of this final agency action and the 
Commission's rules, the Clearinghouse selection process must comply 
with the following deadlines:
     January 5, 2023, or prior to first meeting: search 
committee members must file certifications in WT Docket No. 19-348.
     January 5, 2023: the search committee must meet.
     March 6, 2023: the search committee must prepare and 
submit the RFP to the Bureau.

[[Page 78577]]

     April 3, 2023: deadline for applicants to submit responses 
to the RFP.
     May 2, 2023: the search committee must notify the Bureau 
of its tentative Clearinghouse selectee.
     July 3, 2023: the Clearinghouse selectee must enter into 
contracts with incumbents and new entrants and submit such contracts to 
the search committee. For good cause shown, the search committee may 
request one brief extension of this deadline.
     August 1, 2023: the search committee must review contracts 
and notify the Bureau whether or not the contracts are approved and 
whether or not the Clearinghouse selection is finalized, subject to the 
Bureau determination that the selection criteria have been satisfied.

D. Duties of the Clearinghouse

    Consistent with the delegation of authority in the 3.45 GHz Band 
Second R&O and the Commission's rules, the Bureau herein sets forth the 
duties of the Clearinghouse. As in other spectrum band transition 
processes, the Bureau finds that an independent clearinghouse that 
oversees the reimbursement process for the 3.45 GHz band transition in 
a ``fair, and transparent manner will best serve the public interest.'' 
To that end, below the Bureau establishes procedures to prevent waste, 
fraud, and abuse in connection with relocation reimbursement 
disbursements.
    Collection of reimbursement requests and supporting documentation. 
The Clearinghouse will be responsible for collecting from the two 
incumbent radiolocation operators a showing of their relocation costs 
for the transition as well as a demonstration of the reasonableness of 
those costs. The Clearinghouse will determine in the first instance 
whether costs submitted for reimbursement are reasonable. Parties 
seeking reimbursement for actual costs must submit to the Clearinghouse 
a claim for reimbursement, complete with sufficient documentation to 
justify the amount. The Clearinghouse shall review reimbursement 
requests to determine whether the costs are reasonable and to ensure 
they comply with the requirements adopted in the 3.45 GHz Band Second 
R&O. The Clearinghouse shall give parties the opportunity to supplement 
any reimbursement claims that the Clearinghouse deems deficient.
    Incumbents seeking reimbursement for their actual costs shall 
provide justification for those costs. The Clearinghouse shall specify 
a procedure for the submission of relocation cost documentation. 
Entities must document their actual expenses and shall submit such 
documentation pursuant to the procedures specified by the Clearinghouse 
at any time after those expenses have been incurred. The Clearinghouse 
may conduct audits of entities that receive reimbursements. Incumbents 
receiving reimbursements must make available all relevant documentation 
upon request from the Clearinghouse.
    To determine the reasonableness of reimbursement requests, the 
Clearinghouse may consider the submission and supporting documentation 
and any relevant comparable reimbursement submissions. If the 
Clearinghouse determines that the amount sought for reimbursement is 
impermissible or unreasonable, it shall notify the party of any amount 
that it deems eligible for reimbursement. Approved, adjusted, or denied 
claims shall be simultaneously invoiced to the relevant claimant and 
the 3.45 Service licensees, allowing 30 days for review. To the extent 
that either a claimant or an 3.45 Service licensee wishes to dispute a 
final Clearinghouse decision, it may do so by providing written notice 
to the Bureau in the above-captioned docket within 30 days of invoice 
issuance. The Bureau shall resolve any such dispute. To the extent 
necessary, the Bureau may establish supplemental procedures for the 
resolution of any disputes that may arise during the transition. Once 
the 30-day invoice review period has run and absent any dispute, the 
Clearinghouse shall disburse approved claims from the reimbursement 
fund.
    Apportionment of Costs Among 3.45 GHz Service Licensees. The 
Clearinghouse shall apportion costs among 3.45 GHz Service licensees 
and distribute payments to incumbent radiolocation licensees pursuant 
to the cost allocation structure established in the 3.45 GHz Band 
Second R&O and the Commission's rules. Specifically, each 3.45 GHz 
Service licensee that is granted an initial license (not a renewal) 
``must pay a pro rata portion to reimburse the costs incurred by 
authorized non-federal, secondary radiolocation licensees for 
relocating from the 3.3-3.55 GHz band.'' These costs shall include 
``the cost of a clearinghouse's administration of the reimbursement, 
which the radiolocation licensees will pay initially and include in 
their reimbursable costs.'' The Clearinghouse shall determine a 
licensee's pro rata share of relocation costs by dividing the total 
actual costs of the incumbents' relocation (as approved by the 
Clearinghouse), ``by the total number of 3.45 GHz Service licenses 
granted, multiplied by the number of such licenses [a] Licensee will 
hold.'' Forty-five days after the Clearinghouse has entered into 
contracts with incumbents and new licensees, the Clearinghouse shall 
calculate the share of each 3.45 Service licensee based upon the 
reimbursement documentation received from the incumbents. The initial 
share shall incorporate any relocation-related costs incurred prior to 
the issuance of new flexible-use licenses (May 4, 2022) as well as from 
the time of issuance until the time of calculation. 3.45 GHz Service 
licensees shall pay their share of the initial relocation payments into 
a reimbursement fund, administered by the Clearinghouse, within 30 days 
of receiving an invoice or other written notification of the 
calculation of their initial share. The Clearinghouse shall draw from 
the reimbursement fund to pay approved, invoiced claims that are not 
subject to a dispute before the Bureau.
    Going forward, the Clearinghouse shall calculate the 3.45 GHz 
Service licensees' share of relocation costs at least every six months, 
with the discretion to calculate the share on a more frequent basis as 
needed, and provide each licensee with the amount it owes no more than 
30 days after each period that it calculates the licensees' share of 
relocation costs. Within 30 days of receiving the invoice or other 
written notification of the calculation of its share, each 3.45 GHz 
Service licensee shall pay its share of costs into the reimbursement 
fund. The Clearinghouse shall draw from the reimbursement fund to pay 
approved reimbursement claims. The Clearinghouse shall pay approved 
claims 30 days after invoice submission to the relevant claimant and 
3.45 GHz Service licensees for their review so long as: (1) funding is 
available; and (2) there is no dispute regarding the underlying 
Clearinghouse decision before the Bureau. If the reimbursement fund 
does not have sufficient funds to pay approved claims before a six-
month replenishment, the Clearinghouse shall provide 3.45 GHz Service 
licensees with 30 days' notice of the additional shares each must 
contribute. Any interest arising from the reimbursement fund shall be 
used to defray the costs of the transition for all 3.45 GHz Service 
licensees on a pro rata basis. At the end of the transition, the 
Clearinghouse shall return any unused amounts to the 3.45 GHz Service 
licensees according to their pro rata shares.
    If a 3.45 GHz Service license is relinquished to the Commission 
prior to all relocation cost reimbursements being paid, the remaining 
payments will be distributed among the remaining 3.45 GHz Service 
licensees. If a new license

[[Page 78578]]

is issued for the previously relinquished rights prior to final 
transition payments becoming due, the new 3.45 GHz Service licensee 
will be responsible for the same pro rata share of relocation costs as 
the initial 3.45 GHz Service licensee on a going forward basis from the 
new license grant date. If a 3.45 GHz Service licensee assigns its 
rights through the secondary market, the new 3.45 GHz Service licensee 
will be obligated to fulfill all outstanding and future transition 
payment obligations associated with the license.
    3.45 GHz Service licensees will, collectively, pay for the services 
of the Clearinghouse and staff. The Clearinghouse shall include and 
itemize its own reasonable costs in the cost estimates it uses to 
collect reimbursement fund payments from 3.45 GHz Service licensees. To 
ensure the Clearinghouse's costs are reasonable, the Clearinghouse 
shall provide to the Office of the Managing Director and the Wireless 
Telecommunications Bureau, by April 1 of each year beginning in 2024, 
an audited statement of funds expended to date, including salaries and 
expenses of the Clearinghouse. It shall also provide additional 
financial information as requested by the Office or Bureau to satisfy 
the Commission's oversight responsibilities and/or agency-specific and 
government-wide reporting obligations.
    Dispute Resolution. As in the 3.7 GHz transition and consistent 
with our rules, the Clearinghouse here will serve in an administrative 
role and in a function similar to a special master in a judicial 
proceeding. In contrast with the 3.7 GHz Band R&O (85 FR 64062, October 
9, 2020), which enabled the Clearinghouse to mediate any cost disputes 
or refer the parties to alternative dispute resolution fora, here the 
Commission directed that any disputes arising from Clearinghouse 
decisions shall be decided by the Bureau. The Bureau reiterates that to 
the extent that either a claimant or a 3.45 Service licensee wishes to 
dispute a final Clearinghouse decision, it may do so by providing 
written notice to the Bureau in the above-captioned docket within 30 
days of invoice issuance. To the extent that a 3.45 Service licensee 
wishes to dispute the calculation of its pro rata contributions to the 
reimbursement fund, or any transition-related payment obligation other 
than a reimbursement claim invoice, it may do so by providing written 
notice to the Bureau in the above-captioned docket within 30 days of 
invoice issuance or other written notification of its payment 
obligation. To the extent necessary, the Bureau may establish 
supplemental procedures for the resolution of any disputes that may 
arise during the transition.
    Reports to the Bureau. The Clearinghouse shall provide certain 
information and reports to the Commission to facilitate our oversight 
of the transition. Each quarter, the Clearinghouse shall submit 
progress reports to the Bureau that detail the status of reimbursement 
funds available, the payments issued, and the amounts collected from 
licensees. The first such report must be filed no later than April 1, 
2024. The reports must account for all funds spent, including the 
Clearinghouse's own expenses (including salaries and fees paid to law 
firms, accounting firms, and other consultants). The Clearinghouse 
shall provide to the Wireless Telecommunications Bureau and the Office 
of the Managing Director additional information upon request.
    No later than 18 months after the release of this final agency 
action, the Clearinghouse must issue a special, audited report 
identifying any issues that have not already been referred to the 
Commission as well as what actions, if any, need to be taken for the 
Clearinghouse to complete its obligations (including the estimated 
costs and time frame for completing that work).
    Bureau Oversight. To ensure the timely and efficient transition of 
the band, the Bureau will provide the Clearinghouse with any needed 
clarifications or interpretations of the Commission's rules or orders 
issued by the Commission or Bureau. As noted above, the Bureau and the 
Office of the Managing Director may request any documentation from the 
Clearinghouse necessary to provide guidance or carry out oversight.
    The Bureau will issue a Public Notice upon receipt of a request of 
the Clearinghouse to wind down and suspend operations. If no material 
issues are raised within 15 days of the release of said Public Notice, 
the Bureau may grant the Clearinghouse's request to suspend operations 
on a specific date. 3.45 GHz Service licensees must pay all transition 
costs incurred and invoiced prior to the date set forth in the Public 
Notice.

E. Safeguards for Clearinghouse Operation

    In the 3.7 GHz Band R&O, the Commission stated that the 
Clearinghouse should operate ``pursuant to Commission rules and 
oversight, to mitigate financial disputes among stakeholders, and to 
distribute payments in a timely manner.'' 35 FCC Rcd 2343, 2446, para. 
255 (2020). In addition, the Commission concluded that it needed to 
``establish measures to prevent waste, fraud, and abuse with respect to 
reimbursement disbursements'' and that the Clearinghouse should adopt 
``robust privacy and data security best practices in its operations.'' 
Id. para. 277. The Bureau agrees that such measures are likewise 
appropriate as part of the 3.45 GHz transition.
    CTIA proposes a series of ``appropriate safeguards'' to protect all 
involved stakeholders and ``ensure the integrity of the process.'' 
Given the Commission's directive in this proceeding to develop and 
implement a Clearinghouse selection process similar to the process used 
in the 3.7 GHz proceeding, the Bureau concludes those safeguards 
proposed by CTIA, which are consistent with the processes articulated 
in the 3.7 GHz Band R&O, should be adopted here. Thus, the 
Clearinghouse here must:
     Process claims consistent with the 3.45 GHz Band Second 
R&O, and any clarifications issued by the Commission or the Bureau;
     Operate in a fair and transparent manner;
     Adopt a process for protecting confidential information;
     Hold deposits to minimize the risk of loss, (e.g., all 
funds collected for reimbursement must be placed in a reputable 
financial institution and may only be invested in U.S. Treasury bonds); 
and
     Specify timing for the reimbursement process.
    In addition, consistent with the need to prevent waste, fraud, and 
abuse in its handling of reimbursement funds, all Clearinghouse 
accounting related to such funds is subject to an annual audit to be 
performed by an independent third party selected by the Clearinghouse. 
The Clearinghouse shall report to the FCC all evidence and/or 
allegations of suspected fraud, waste, or abuse related to the 3.45 GHz 
relocation program, along with an initial assessment of their 
credibility and substantiality. Further, the Clearinghouse shall 
establish procedures enabling outside parties to report allegations of 
fraud, waste, or abuse to the RPC, and maintain a log of all such 
allegations that it receives. Parties seeking to report claims of 
fraud, waste, and abuse directly to the FCC may do so either by phone 
(202-418-1940) or electronically ([email protected]).
    To the extent that any adjustments to the Clearinghouse process or 
administration are necessary going forward, the Commission delegated 
authority to the Bureau to make such

[[Page 78579]]

necessary modifications. Should the Clearinghouse violate or otherwise 
fail to comply with the Commission's rules, the Clearinghouse's 
authority to operate may be terminated and, subject to the delegated 
authority discussed above, the selection of a new clearinghouse may be 
initiated.

F. CTIA Waiver Requests

    CTIA requests that certain rules relating to the operation of the 
Clearinghouse be waived in order to allow reimbursement payments 
directly from 3.45 GHz Service licensees to incumbent radiolocation 
service operators and to permit the Bureau to determine allowable costs 
for reimbursement as an initial matter. If granted, CTIA's requests 
would strip the Clearinghouse of its core functions--determining 
reasonable reimbursement costs, billing and collecting reimbursement 
funds from new entrants, and disbursing payments to incumbents--and 
would reduce the Clearinghouse's role to essentially an accounting 
function. The Bureau finds that CTIA's requests are not for waivers but 
rather appear to seek rule changes. As such, they are essentially 
untimely requests to reconsider decisions made by the Commission in the 
3.45 GHz Band Second R&O and are beyond the scope of the authority 
delegated to the Bureau in establishing procedures to select and 
administer a Clearinghouse. The Bureau therefore dismisses CTIA's 
requests.

IV. Ordering Clauses

    Accordingly, it is ordered that, pursuant to sections 2, 4(i), 
5(c), 157, 301, 303, 307, 308, 309, of the Communications Act of 1934, 
as amended, as well as the Commercial Spectrum Enhancement Act, Public 
Law 108-494, 118 Stat. 3986 (Dec. 23, 2004) as amended, and the MOBILE 
NOW Act, Public Law 115-141, 132 Stat. 1098, Div. P, Title VI, sec. 603 
(Mar. 23, 2018), 47 U.S.C. 152, 154(i), 155(c), 157, 301, 303, 307, 
308, 309, 309(j)(3)(B), 309(j)(4)(D), 923(g), 928, 1502, by the Beat 
China by Harnessing Important, National Airwaves for 5G Act of 2020, 
Public Law 116-260, Division FF, Title IX, Sec. 905, and by the 
authority delegated in paragraph 163 of the 3.45 GHz Second R&O, the 
Order is hereby adopted.
    It is further ordered, that, pursuant to the authority delegated in 
Sec. Sec.  0.131 and 0.331 of the Commission's rules, 47 CFR 0.131, 
0.331, CTIA's Waiver Requests are denied.
    It is further ordered that the Commission's Consumer and 
Governmental Affairs Bureau, Reference Information Center, shall send a 
copy of the Order, including the Supplemental Final Regulatory 
Flexibility Analysis, to the Chief Counsel for Advocacy of the Small 
Business Administration.
    It is further ordered that the Order shall be effective 30 days 
after publication in the Federal Register.

Federal Communications Commission.
Amy Brett,
Acting Chief of Staff, Wireless Telecommunications Bureau.
[FR Doc. 2022-27820 Filed 12-21-22; 8:45 am]
BILLING CODE 6712-01-P