House Republicans Investigate FCC Over Spectrum Auction Waiver to Obama Donor

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The House Energy and Commerce Committee is asking the FCC for information on how it decided to grant a waiver to a company controlled by a donor and fund raiser to President Obama’s presidential campaigns.

The focus is a July 23 waiver granted to Grain Management, giving it credits to qualify as a small business in an upcoming auction of airwaves intended to increase spectrum for wireless devices. Bloomberg News first reported on the waiver, which passed 3-2, noting that the company was controlled by David Grain, who raised money and contributed to Obama’s campaigns.

“The Energy and Commerce Committee is committed to conducting vigorous oversight to ensure that commission processes are fair, open, and transparent, and that they serve the public interest. The granting of the Grain Management waiver raises questions about these processes,” Republican lawmakers wrote in a letter to FCC Chairman Tom Wheeler. It was signed by Rep. Fred Upton (R-Mich.), chairman of the House Energy and Commerce Committee; Rep. Greg Walden (R-Oregon), chairman of the Communications and Technology Subcommittee; and Rep. Tim Murphy (R-Pa.), chairman of the Oversight and Investigations Subcommittee.

The intent of the waivers are to allow small- and minority-owned businesses to have a better chance of obtaining spectrum licenses, because of concerns that large firms will dominate such auctions. But Grain Management had leases to AT&T and Verizon that may have prevented it from qualifying for the small business credits.

House Republicans are seeking draft versions of the waiver order, communications between Grain Management and the commission, and all documents related to the waiver rule, dating to 2006. The FCC released a copy of the waiver along with dissents from Commissioners Ajit Pai and Michael P. O’Rielly.

In a statement, an FCC spokeswoman said, “We welcome the Committee’s request for information about the Commission’s recent action to promote the ability of entrepreneurs and small businesses to compete in our upcoming auctions. The Commission’s action, which followed a period of public notice and comment, is consistent with Congress’s directive to design auctions that encourage participation among a wide variety of companies, including small businesses. We stand ready to act as a resource to Congress as we continue to address this important issue.”

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