Free spectrum bill draws flak

WASHINGTON — The White House is warning Republicans that it has “serious problems” with a pending budget bill that hands broadcasters a multibillion-dollar slice of airwaves for free, while also loosening the rules governing the ownership of TV stations.

The Clinton administration focused its criticism Friday on provisions of the budget bill that would allow broadcasters to own more than one TV station in large cities. The White House also strenuously objects to language in the bill that would end the ban on owning a newspaper and TV station in the same market. Neither provision would go into effect until broadcasters completed their migration to a digital-only TV service.

“We keep telling them it’s got to come out,” said an administration source. The deregulatory provisions could be struck down in the Senate, which has rules barring the addition of any language to a budget bill that does not pertain to raising revenue or cutting taxes.

In addition to its objections on ownership deregulation, the White House opposes language in the bill which orders the FCC to grant exemptions to the Dec. 31, 2006, deadline for returning to the government one of the two TV channels broadcasters will soon control. Under the bill, the FCC must extend the deadline in any market where less than 85% of the homes do not have the ability to receive a digital TV signal. An 85% penetration rate will be hard to reach in any market by 2007. The first digital TV sets are expected to cost at least $5,000 and will not go on the market until late 1998.

Despite the objections, key Republicans signed off on final language that reconciled differences between the House and Senate versions of the plan to raise revenue by selling the rights to federally controlled airwaves. Among those who formally approved the plan were Sen. Ted Stevens (R-Alaska) and commerce committee chairman John McCain (R-Ariz.). House telecommunications subcommittee chairman Billy Tauzin (R-La.) signed in the House. A Tauzin aide said that House Commerce Committee chairman Thomas Bliley (R-Va.) was also expected to sign late Friday.

But the decision to give every TV station in the country an extra channel to launch a digital service left legislators $6 billion short of their assignment to raise $26 billion for deficit reduction. Most of the money was raised through the sale of federal frequencies not used by broadcasters, including some used by the Defense Dept.

The bill does order broadcasters to move out of the spectrum they now use for live sporting events and remote news shots. In return for vacating their current microwave frequencies, broadcasters will be given spectrum elsewhere in the radio ban. The cost of the move, including new equipment, will be covered by the winning bidder at the federal spectrum auction.

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