White House Proposes More Funding for FCC, FTC in FY 2016

The budget would allocate $388 million for the FCC, about $48 million more than the budget Congress approved in FY 2015. The figure is higher than the $375.38 million that the White House requested last year. Hill appropriation for the FCC is seen as one possible net neutrality battlefield later this year (see 1501090038).

The White House proposal "continues support of FCC information technology modernization, funds the FCC's headquarters transition, and further improves the Do-Not-Call registry for telephone numbers used by Public Safety Answering Points,” the White House said more than 1,200 pages into the appendices it posted. “The Budget includes a $25 million transfer from the Universal Service Fund to provide robust oversight of universal service programs, including targeted investments that will identify and reduce improper payments while combating fraud, waste and abuse. Funding for the Inspector General is not less than $12.2 million.”

The FCC paid $46 million in rent to the General Services Administration in FY 2014, $45 million in FY 2015 and expects to pay $46 million again in FY 2016, the budget said, naming reimbursable expenses. It describes $100 million slated for the programming and financing of the TV Broadcaster Relocation Fund for FY 2016.

The FTC and Commerce Department posted breakdowns of the administration budget requests (see here and here). The budget would allocate $309.2 million for the FTC, about $16 million more than what was requested and approved for FY 2015. It would change how the FTC is funded. Some of its funding is currently offset by Hart-Scott-Rodino Act premerger notification filings, which would be $103.5 million in fees for FY 2016 under the current system. “The Budget proposes to increase the Hart-Scott-Rodino fees and index them for the percentage annual change in the gross national product,” the White House budget said of the change, to take effect in 2017. “The fee proposal would also create a new merger fee category for mergers valued at over $1 billion.”

NTIA would receive $49.2 million under the White House budget, more than $10 million more than it was allocated for FY 2015. Next year, “NTIA will continue to evaluate options for repurposing spectrum for broadband use, in support of the President's goal of making 500 MHz of spectrum available for wireless broadband use by 2020,” the budget said, outlining a plan that “(1) continues to provide spectrum assignment and analysis support to Federal agencies; (2) takes a more direct leadership role in managing the U.S. domestic and international Internet policy agenda to promote an open, unregulated Internet platform that encourages economic growth and innovation, while addressing concerns over consumer privacy and other threats to the internet.” NTIA would “complete the administration” of the Broadband Technology Opportunities Program (BTOP), the budget said. It said NTIA would “leverage” its BTOP experience in the launch of BroadbandUSA, “which will encourage partnerships among State, municipal, non-profit, and private sector organizations and support deployment of new community broadband systems."

The estimated obligations in FirstNet program financing would be $147 million for FY 2016, up from the $117 million for FY 2015. "As of February 2015, the FirstNet Board had not approved FY 2016 obligation and outlay levels, so those amounts reflect preliminary projections,” which “will be updated upon approval of requirements and associated funding amounts by the FirstNet Board,” the budget said. The Public Safety Trust Fund will likely get “significant transfers” in funding as a result of the profitable AWS-3 spectrum auction, helping in the funding of FirstNet, the budget noted.

"If we don’t have a vital infrastructure, if we don’t have broadband lines across the country, if we don’t have a smart grid, all that makes us more vulnerable,” Obama said Monday at the Department of Homeland Security. The budget prioritizes “expanded access to faster Internet,” Obama said.

“Better broadband” is needed as part of U.S. infrastructure, Obama wrote in his budget message to Congress. “This Budget provides the resources we need to defend the Nation against cyber-attacks,” Obama also said. “No foreign nation, no hacker, should be able to shut down our networks, steal our trade secrets, or invade the privacy of American families. In addition to increasing funding to protect our Nation against cyber-attacks, I continue to urge the Congress to finally pass the legislation we need to meet this evolving threat.”

The proposal would slate “$14 billion to support cybersecurity efforts across the Government to strengthen U.S. cybersecurity defenses and make cyberspace more secure, allowing the Government to more rapidly protect American citizens, systems, and information from cyber threats,” a White House fact sheet said. The budget would also back digital delivery service for consumers and slate $105 million “to scale and institutionalize this approach and create digital services teams in 25 key agencies,” the fact sheet said. “It also includes increased funding to scale up the central USDS team to aid in building the agency teams, increase oversight and accountability for IT spending, improve IT procurement, and improve agency cybersecurity and cyber readiness.”

One White House provision would force the FCC to enact spectrum license user fees "and allow the FCC to auction predominantly domestic satellite services.” It said the proposal would reduce the deficit in the coming years, by $225 million in FY 2016 and $325 million in FY 2017. The White House also unsuccessfully included that proposal a year ago, prompting CTIA and NAB opposition (see 1403050027), and in years and administrations past. "Consistent with our position on previous proposed White House budgets, NAB will strongly oppose spectrum fees that imperil the financial underpinnings of local television and the tens of millions of viewers that we serve,” an NAB spokesman told us Monday. CTIA is also “opposed to new spectrum fees,” Vice President-Government Affairs Jot Carpenter said. “The Administration can call its proposal fees, but as a practical matter, these fees are a tax that will depress auction revenues, harm investment, and do nothing to advance consumers' adoption of wireless broadband services.”

Another provision said the Executive Office of the President would “promote Spectrum Relocation Fund flexibility,” which would add $50 million to the deficit in FY 2016 but cut the deficit by $45 million in FY 2017 and $75 million in FY 2018, cutting $330 million from the deficit in total for the FY 2016-2020 period. “Deficit savings achieved through the increased value of monetized spectrum achieved via targeted investments that will enhance Federal spectrum efficiency and create more opportunity for spectrum sharing,” the budget document said in a footnote. Another provision said the budget would “clarify penalties and prohibitions for misleading Internet advertising.” The proposed budget for the Department of the Interior includes $41 million “to extend broadband internet and computer access to all [Bureau of Indian Education]-funded schools and dormitories,” backed by NTIA’s community broadband outreach program, it said.

Republicans scoffed. “The White House knows that its proposed tax increases and other budget gimmicks will never be enacted into law, and it is playing an irresponsible shell game with the federal budget,” said House Appropriations Committee Chairman Hal Rogers, R-Ky. Senate Majority Leader Mitch McConnell, R-Ky., dismissed the proposal as a “top-down, backward-looking document that caters to powerful political bosses on the Left and never balances -- ever.” The Senate Budget Committee plans a hearing on the White House budget Tuesday at 10 a.m. in Dirksen 608. The one witness listed is Shaun Donovan, director of the Office of Management and Budget.