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New FCC Rules Permit States to Lease 4.9 GHz Band Spectrum

Posted by CommLaw | Oct 11, 2020 | 0 Comments

The Federal Communications Commission on September 30, 2020 adopted new rules permitting states to lease spectrum in the 4.9 GHz (4940-4990 MHz) band. Under the new rules, states may determine the highest and best use for the band, and thus may continue to use the spectrum for their own public safety network operations; may enter into commercial arrangements for deployment of public-safety communications services; may lease spectrum to a commercial provider for deployment of mobile or fixed wireless Internet service, private land mobile radio service or critical infrastructure connectivity; or a combination of any of these or other arrangements allowed by FCC rules.

In adopting the new rules, the FCC determined that allowing leased access to the shared 4.9 GHz band for non-public safety operations would increase investment in and efficient use of the band. The FCC also predicted that the new rules would decrease deployment barriers while encouraging greater public safety and non-public safety uses of the band, by driving down equipment prices and facilitating cost-sharing arrangements between licensees and lessees.

The new rules generally will become effective 30 days after publication in the Federal Register.

Background. Under the current licensing scheme, 4.9 GHz band spectrum has been underutilized. Access to the band has been restricted to entities that provide public safety services – state and local government entities, and nongovernmental organizations (NGOs) providing communications for the sole or principal purpose of protecting the safety of life, health or property. Licensees may enter into sharing agreements with ineligible entities, but operations must support public safety. Licenses are issued for the geographic area encompassing the legal jurisdiction of the licensee. There is no exclusive use of the band, and licenses often overlap: there may be one or more geographic area licenses covering a given location and licensed on the same spectrum, in addition to fixed-site licenses. The rules do not specify a formal coordination requirement: licensees informally cooperate to ensure that their operations do not cause interference with one another, and to resolve any interference.

New Rules Allow State Lessors to Lease Spectrum for Non-Public Safety Use. The new rules allow one entity in each state (the State Lessor) to voluntarily lease spectrum rights to any entity that is otherwise eligible to lease spectrum for fixed or mobile use, including commercial entities and others with non-public safety operations, and public safety entities. Leasing by a 4.9 GHz band licensee that is not the State Lessor is prohibited. The State Lessor may lease spectrum rights in all or any portion of a state, may divide rights on a geographic, spectral, or temporal basis, and may lease rights associated with its permanent fixed sites. A State Lessor also may enter into agreements to share equipment or other deployment costs.

Leasing Limited to States that Do Not Divert 911 Fees. Only states not identified in the FCC's December 2019 911 Fee Report as diverting 911 fees for non-911 purposes may lease spectrum under the new rules.

Elimination of the Public Safety Use Restriction for State Lessors. The FCC eliminated the requirement that 4.9 GHz spectrum may be used only for public safety purposes. If a licensee other than a State Lessor seeks to engage in non-public safety operations, it must lease the necessary spectrum rights from the State Lessor in its jurisdiction.

Selection of State Lessor. Leasing is not permitted in states that have no statewide licensee. A state seeking to enter into voluntary leasing arrangements must select a single state entity that is a statewide 4.9 GHz band licensee to act as the State Lessor. If a state has a single statewide license, that licensee is deemed to be the default State Lessor. A default State Lessor may assign its license to another statewide entity if that entity is deemed a more appropriate State Lessor. If a state has multiple statewide licenses and voluntarily seeks to lease, it must select one of the entities as the State Lessor. A statewide licensee not selected as State Lessor may continue to operate pursuant to its authorization but may not lease spectrum rights. The FCC placed no restrictions on sharing lease payments or other compensation.

As part of any lease arrangement, a State Lessor must submit FCC Form 608 with a copy of the written agreement signed by each multiple statewide licensee indicating the selection of the State Lessor. If states with multiple statewide licensees are unable to reach an agreement, the FCC will accept a gubernatorial letter designating one licensee as the State Lessor.

Application of the FCC Secondary Markets Framework and Other Rules. A State Lessor may enter any leasing arrangement permitted by the FCC's secondary market rules, including de facto transfer spectrum leasing (where the licensee retains de jure control of the license while de facto control of the spectrum is transferred to the lessee), and spectrum manager leasing (where the lessee may use the spectrum but the licensee retains de jure and de facto control). A State Lessor must comply with applicable FCC leasing rules, rules associated with the original license, and state laws related to leasing activities.

Lessee Rights and Responsibilities. A lessee may conduct any type of fixed or mobile operation, including commercial, critical information infrastructure, or operations in support of public safety. A lessee of a geographic area may construct base stations and engage in mobile operations, and construct temporary fixed sites within the lease area as permitted by the lease as if it were a licensee. However, it may not add stations/sites required under FCC rules to be individually licensed. If a lessee's operations require individual site licensing, the State Lessor must file for a license and then lease the site to the lessee. A lessee also must comply with requirements applicable to its specific operations, such as those applicable to CMRS providers.

4.9 GHz Incumbent Licensee Rights. An incumbent is a 4.9 GHz licensee with an active license as reflected in ULS as of September 8, 2020, or a 4.9 GHz licensee granted an authorization by a waiver or modification of the Freeze Notice. The new rules do not modify the rights of an incumbent other than a licensee selected to be a State Lessor, and an incumbent, whether a public safety agency or NGO, may continue to operate existing system(s) or make additional deployments pursuant to the terms of its license, consistent with FCC rules.

Coordination. Informal coordination requirements apply to lessees in the same way as licensees. Thus, a lessee must cooperate with other operators in and around its area of operations in the selection and use of channels in order to reduce interference. A lessee must cooperate to resolve harmful interference to the mutual satisfaction of operators, and must adjust operations to prevent, or resolve, interference to fixed links with primary status. Incumbents must work with lessees to prevent and resolve harmful interference through cooperation, and State Lessors must work with incumbents for the same purpose. Interference concerns are likely to be lessened in most areas of the country, given the underutilization of the 4.9 GHz band.

Modification of Application Freeze. On September 8, 2020, the FCC’s Public Safety and Homeland Security Bureau and Wireless Telecommunications Bureau issued a freeze, pursuant to which the FCC no longer accepts or processes applications for new or modified 4.9 GHz band licenses (Freeze Notice). The Bureaus will now modify the freeze to accept applications for a statewide license from a single entity per state in a state that did not have a statewide licensee at the time of the freeze, provided that entity is designated by the state as the State Lessor. The Bureaus also will accept applications for permanent fixed site licenses, if filed by a State Lessor.

Comment Sought on Additional Changes. In a Seventh Further Notice of Proposed Rulemaking (FNPRM), the FCC proposes a new licensing framework for public safety operations in the 4.9 GHz band. Comments on the FNPRM will be due 30 days after publication of the item in the Federal Register. In particular, the FCC asks for comment on the following topics:

  • State-Based Licensing. The FCC proposes to limit future 4.9 GHz band licensing to state entities seeking a statewide license in states without an existing statewide licensee, and to not accept new or modified applications for a license authorizing less than statewide operations.
  • Grandfathering Incumbent Licenses. The FCC proposes that licensees authorized as of the date of the Freeze Notice or pursuant to a waiver or modification of the Freeze Notice be allowed to renew those licenses and to add base stations, mobile units, and temporary fixed sites within their authorized license area, up to the limits of their jurisdiction. An incumbent operating a fixed point-to-point or a fixed point-to-multipoint system also would be permitted to renew its license and to continue operations, but not to increase its spectral or geographic coverage or to obtain a license for a new fixed system.
  • State Management of 4.9 GHz Operations. The FCC proposes that a state government would have the option to oversee all 4.9 GHz band operations in the state. Each would be allowed to select a statewide entity (the State Lessor or another statewide licensee) as “State Band Manager,” with authority to manage access to and public safety operations within the band. A public safety entity seeking new access to the band or a licensee seeking to expand operations would be authorized to operate under a State Band Manager's license. The State Band Manager would coordinate operations to prevent harmful interference among and between public safety and non-public safety entities. The FCC seeks comment on this approach, including a selection process for a State Band Manager; the rights and responsibilities of a State Band Manager; the extent to which states are equipped to take on this role; and the future of fixed site licensing.
  • Sharing Arrangements for Public Safety. The FCC asks whether it should eliminate the requirement that when a 4.9 GHz licensee enters into a sharing arrangement with an entity that is not eligible for a license, that entity must use the spectrum to support public safety services.
  • Interference Protection and Resolution. The FCC asks whether additional rules are needed to reduce the likelihood of harmful interference between shared users of the 4.9 GHz band, in light of other rule changes likely to increase usage and to introduce a new, potentially disparate technologies and network architectures.
  • 911 Fee Diversion. The FCC asks whether it should require a state to stop 911 fee diversion before it is permitted to adopt either the State Lessor or State Band Manager framework.

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