What does it take to get agencies to give up spectrum?

The Obama administration is in the midst of a push to free up 500 MHz of spectrum to support a massive expansion of wireless commercial broadband, and getting federal agencies to move off their spectrum holdings is a big part of that effort. But getting agencies to move, even from fallow or underutilized spectrum holdings, can be a tricky proposition.

So far, the administration has resisted forceful tactics like an executive order or a version of the military base closure system to get agencies to toe the party line on spectrum. As a practical matter, dictating the disposition of federal spectrum would be a time-consuming, highly detailed and immersive task, especially if it had to be done without the cooperation of agencies. But, as White House deputy CTO Tom Power said at a Brookings Institution discussion, agencies don't incur opportunity costs for sitting on spectrum, and have "no real incentive to shrink their footprint."

Under current law, agencies can recoup money raised from auctions of spectrum under a legislative formula that requires them to project relocation costs. Agencies are eligible to receive up to 110 percent of those projected costs, although the funds must be used for relocating spectrum-dependent activities to new bands. But the structure of the law puts agencies in a kind of Catch-22 situation, Power said. "You can have planning money if you can show there is going to be a return. But you need money to do the work to get in a position to know which bands to start looking at. So you need that funding up front. But you can't get that funding until you've already got a plan that shows the return," he said.

A bill by Reps. Brett Guthrie (R-Ky.) and Doris Matsui (D-Calif.) would give agencies more flexibility on how to spend auction revenue, but would grant them only 1 percent of proceeds. "It will shock you to learn that [agencies] think the number should be a little higher," Power said.

The federal government's landlord offers one possible model for optimal spectrum management, according to Dorothy Robyn, former commissioner of the Public Buildings Service at the General Services Administration.

First, GSA is good at pricing its assets and making agencies pay market rates for real estate, she said. Second, GSA has built into its culture a passion for divesting unneeded or wasteful assets. Robyn suggests charging spectrum fees to agency users based on some calculation of market rate to get agencies to use their allotments more efficiently. Calculating the value of spectrum would be controversial and lead to disputes, but it would not be unprecedented. Perhaps more importantly, she said, the fees would generate money for investment in newer systems. "Federal agencies use spectrum inefficiently in good part because they cannot afford" to invest in new systems.

Getting federal spectrum to the commercial market is a long process, but there has been incremental progress. In November, the Federal Communications Commission will auction three swathes of highly desirable spectrum formerly under Department of Defense control. The winners of the auction of the AWS-3 (Advanced Wireless Services) bands will have to share some spectrum indefinitely with government users. But it took years of lobbying by wireless firms and bipartisan prodding from Congress to get the Defense Department to agree to move some operations.

But the time it took to bring about the AWS-3 auction suggests that a more permanent, flexible incentive structure to let agencies reap the rewards of their spectrum holdings would be useful. Adele Morris, a Brookings fellow and former Treasury official who dealt with spectrum issues, advocates giving agencies incentives to vacate or share spectrum, "even if it means making unusual exceptions to budget policies," she wrote in a paper. She also supports giving a federally funded research group or other third party organization the job of analyzing agency spectrum use – work that she said is outside the core competencies of most agencies.

"Energetic, spectrum-savvy political appointees come and go," Morris noted. "If you're someone in the trenches who's opposed to whatever the initiative du jour is, it's generally a feasible strategy to kind of drag your feet, and eventually it will go away. Fundamentally, if we're going to have reform, it has to be in the interest of the federal agencies."