Media Bureau Should Be More Transparent About Reimbursement, Says NAB

Broadcasters need more transparency from the FCC Media Bureau on how broadcaster repacking costs will be reimbursed after the incentive auction, said NAB in comments posted Friday in docket 12-268 on the draft version of the forms that broadcasters will use to request payouts from the $1.75 billion relocation fund. The fund doesn’t have enough money to cover the costs of the repacking, NAB said. “The best forms and processes will not solve the problem.” Along with commenters Association of Public Television Stations, Corporation for Public Broadcasting and PBS and engineering firm Cohen, Dippell, NAB said the form didn’t include enough categories of reimbursable expense, and asked for improvements that would allow broadcasters to submit more complete justifications for their costs.

NAB’s estimates show the repacking costing more than $2.6 billion, its comments said. FCC Incentive Auction Task Force officials have said they expect the relocation fund to completely cover the costs of the repacking. Using the NAB estimate, the fund would cover only two-thirds of the total costs. “The Media Bureau will not even be able to make the proposed 80 percent upfront payments available to all broadcasters before the TV Broadcaster Relocation Fund is completely exhausted,” NAB said. Since the auction order delegated authority to the Media Bureau to prioritize broadcaster reimbursement claims if the fund isn’t sufficient, the bureau should be seeking comment on a proposed prioritization plan, NAB said.

Broadcasters “deserve as much transparency as possible” on how the bureau will evaluate proposed costs, NAB said. The bureau shouldn’t impose a high standard on the justifications required when broadcaster costs don’t fall in line with the bureau’s estimates, NAB said. Because the repacking will create high demand for a limited number of vendors, repacked stations will have “essentially no bargaining power” with the companies that build and install antennas, transmitters and other broadcast equipment, NAB said. “If a station is able to obtain a written quote from its chosen vendor during this time, the Bureau should require no further justification.” Many broadcasters may not be able to get such a quote due to the three-month deadline for estimates after the reassignment public notice is issued, so the bureau should accept good faith estimates as justification as well, NAB said.

The three-month deadline means the bureau should allow broadcasters to be reimbursed for pre-planning costs as well, said PBS, APTS and CPB jointly. “Reimbursement for pre-planning not only helps alleviate some of the pressures created by a short, three-month deadline for submitting estimated costs, but also facilitates local planning for more efficient spectrum use.”

All commenters listed areas of expected expenses they think should be included in the final version of the form. “A form that has more cost categories lumped into 'other' expenses than listed on the form itself is useful neither for the Bureau nor for broadcasters,” NAB said. The form should include sections for costs associated with TV translators and site relocation, said Cohen Dippell. The form should include a section for costs caused by co-located stations, such as those that share a broadcast tower, the public TV allies said. That situation could lead to a non-repacked station incurring costs form the repacking of another station, and the form should address that, they said. NAB listed a host of categories it felt were missing, including sections for legal fees connected with zoning and historical preservation compliance, grant-related expenses and “tax advice.”

All commenters also asked the FCC to make the form user friendly, and to include features such as text boxes without word limits and cut and paste functionality. The form should be easy to amend as broadcasters get more information on their cost estimates and the actual transition of their stations, NAB said. With the comment period complete, the next step is for the draft form to be submitted to the Office of Management and Budget, the bureau said in a September public notice. The public will have an additional chance to comment on the form after it is submitted to OMB, the PN said.