The Administration supports legislation to protect consumers from slamming,
the unauthorized change of a long-distance provider. The Administration
strongly opposes however, House passage of H.R. 3888, as ordered reported
by the House Commerce Committee, because of the unrelated provisions
contained in Title III, "Auction Rescission and Re-Auction", which would
modify the payment terms for "C block" radio spectrum licensees.
Specifically, these provisions would: (1) waive any form of penalty for
failure to make contractual payments and provide a full refund of payments
made to date by successful bidders in the auction of certain radio spectrum
who chose to relinquish their spectrum assignments; and (2) write-down the
value of the debt owed by licensees who chose to retain their spectrum.
Those provisions are highly objectionable on both policy and budget
grounds. They would not only create extensive costs to the Federal
Government, but would undermine the integrity of the spectrum auction
The Administration understands that an amendment may be offered to strike
the provisions that would modify the payment terms for "C-Block" radio
spectrum licenses. If such an amendment were adopted, the Administration
would support passage of H.R. 3888 as amended.
H.R. 3888 would affect receipts; therefore, it is subject to the
pay-as-you-go requirements of the Omnibus Budget Reconciliation Act. This
Office's preliminary estimate is that H.R. 3888 will result in a loss of
receipts of $ 1.131 billion in fiscal year 1999. All of this loss is
associated with Title III, "Auction Rescission and Re-Auction".
The Administration opposes H.R. 3888, and notes that the bill does not
contain provisions to offset the loss in receipts. As a result, if the
bill were enacted without any further action to provide offsets, it could
likely contribute to a sequester of mandatory programs, as required by the
Budget Enforcement Act.