The tally is in, and the number is $2,115,328,744.33. That’s how much eligible TV stations and multichannel video programming distributors have told the FCC it will cost to relocate to their new channel assignments in the wake of the Commission’s recent spectrum incentive auction.
The figure is a compilation of initial reimbursement cost estimates submitted by TV stations and MVPDs as of 7 a.m. Friday. But FCC officials note that the number is preliminary.
“We expect to receive additional estimates from MVPDs and a small number of stations. In addition, the initial estimates that comprise this amount will be subject to a careful review by the Commission and our fund administrator,” Jean Kiddoo, chair of the FCC’s Incentive Auction Task Force, comments. “The aggregate cost estimate provided today will therefore change for purposes of the initial allocation of reimbursement funds.”
The FCC only has a budget of $1.75 billion to spend on reimbursement payments to involuntarily repacked broadcasters. But the FCC said soliciting the estimates that make up the $2.1 billion figure are just a first step to gauge demand for reimbursable costs. The next step will see the FCC’s fund administrator conduct a detailed review of each estimate, asking questions about line items as necessary.
Once the review is complete, the Commission will come out with an initial reimbursement allocation for each eligible entity. Those initial allocations will total $1 billion, and broadcasters will be able to draw against that amount by submitting invoices. Additional allocations from the remaining $750 million will come later.
Per requirements laid out in the Spectrum Act, funds will go only to full power and Class A licensees. The 2014 Incentive Auction Order calls for commercial broadcast stations and cable and satellite providers to receive an allocation of up to 80 percent of their approved costs, while non-commercial stations can get up to 90 percent of their approved estimates.
However, National Association of Broadcasters (NAB) President and CEO Gordon Smith in a statement says the shortfall is unacceptable.
“Congress’s passage of the voluntary broadcast TV incentive auction legislation was premised on a promise that no TV station would be punished for not participating in the auction,” he comments. “Today’s release of total estimated costs for the ‘TV repack’ shows a shortfall of over $365 million in available repacking funds, with a number of television stations and MVPDs not yet included in the total. That number could grow as stations amend cost estimates due to changed circumstances.”
“NAB will work closely with Congress to address this issue, and to additionally ensure that no TV viewer or radio listener loses access to the entertainment and lifeline local broadcast programming they rely on today,” Smith continued.
But there may be a little extra help from an outside source – at least for a select group of broadcasters. T-Mobile recently announced it plans to help cover relocation funds for rural low-power broadcast facilities not covered by the FCC’s $1.75 billion repacking budget. More on that here.
Filed Under: Industry regulations