FCC 375

The Federal Communication Commission has submitted its budget request for the fiscal year that begins October 1and it would take the belt in another notch. The FCC is asking for 1% less than what Congress approved in the current year with a request that totals $335,660,000. That’s $3.95 million less than what the FCC received in the federal government’s 2019 budget. The outline says the budget is designed to create a “lean, accountable, more efficient Commission.”

The Media Bureau, the part of the FCC that has the most contact with radio stations, would receive$19.6 million in funding under the budget blueprint. If approved, that would be a 1.6% increase from the 2019 budget approved by Congress that allocated $19.4 million to the Media Bureau. Nearly all the Bureau’s funding goes toward personnel expenses.

Unlike many federal agencies, nearly all of the FCC’s spending is offset by regulatory fees it collects from license holders like radio stations. While how much radio stations pay will be decided in a later rulemaking, the agency’s budget offers a clue as to what may come. Its 2020 budget request is asking Congress to cut the total amount of money collected through regulatory fees by 1% in the coming year. That reduction lines up with the 1% proposed cut in overall spending, as the FCC remains for the most part a self-sufficient operation.

Even as the budget request has shrunk in terms of sheer dollars, the FCC believes it can do more with less. That includes with staffing. The FCC has requested its budget include 1,448 full-time positions, the same level as approved by Congress in the fiscal 2019 budget. “With this Full Time Equivalent (FTE) level, the Commission will continue to meet its mission demands in FY 2020,” it says. The outline proposes a small cut to the number of Media Bureau employees. It would shrink to 133 full-timers, a loss of five from the current year. The FCC staffing level remains at its lowest level in decades.

The FCC also asks for $132.6 million in budget authority to go toward spectrum auction programs, including funding to reimburse stations impacted by the TV repack. The Commission last week adopted the rules which FM stations affected by the television moves will need to follow in order to secure a share of at least $50 million being set aside to help radio. The agency also points out that auctions are nevertheless a net positive for the U.S. Treasury with nearly $115 billion generated by the FCC’s spectrum auctions program through the years.

Trump Pushes For Spectrum Fees

One recurring feature in federal budgets in recent years has been the White House asking Congress to give the FCC authority to change federal law, clearing the path for the adoption of spectrum use fees. That’s again the case under the Trump administration, which says the money raised would help improve spectrum management and “represent sound economic policy.”

If adopted, the FCC says spectrum use fees would be phased-in over time. It estimates that if the fees are allowed to begin in 2020, as much as $4 billion could be collected from license holders through 2029.

Previous attempts to adopt a spectrum fee have been rejected by Congress, thanks in large part to the lobbying efforts of powerful industries like broadcasters and telecom companies.

Previous attempts to adopt a spectrum fee have been rejected by Congress for the past two decades, thanks in large part to the lobbying efforts of powerful industries like broadcasters and telecom companies. The National Association of Broadcasters vows to fight it again. “NAB vigorously opposes the idea of spectrum fees on broadcasters. This is an unwarranted proposal that threatens the ability of local stations to serve our tens of millions of viewers and listeners,” NAB executive VP Dennis Wharton said.

FCC Move Draws Closer

The federal budget request also provides an update on the FCC’s planned relocation. In 2015, Congress approved a prospectus for a replacement lease for a 15-year term that would reduce the square footage of FCC headquarters by approximately 30% and lower the overall rental expense. “It is estimated that the move will provide up to $119 million in total savings over the 15 years of the new lease,” it says.

Under the current timetable the FCC is slated to move out of the current Portals building by November 2020. That’s when its current lease extension expires. Moving an agency will be no small task, and the government estimates it will cost $71 million to transfer the FCC’s operations to its new building.

The FCC’s new address will be in the Northwest Washington neighborhood known as NoMa, a two-minute walk from NPR’s front door and a ten minute drive to the National Association of Broadcasters’ planned new headquarters in Capitol Riverfront.