FCC’s Use and Enforcement of Buildout Requirements

Government Accountability Office (GAO) examined Federal Communications Commission (FCC) license data for five wireless services and found that buildout requirements were met for 75 percent of those licenses, and FCC generally terminated those that did not.

As part of enforcement, FCC also grants or dismisses licensees’ requests to extend the deadline for meeting a requirement. FCC may grant an extension if the licensee shows that it cannot meet a deadline due to causes beyond its control, like a lack of available equipment. For the five wireless services examined, GAO found that extensions were requested for 9 percent of licenses, and FCC granted 74 percent of these requests.

FCC officials said that the Commission seeks to be aggressive but pragmatic when enforcing buildout requirements, including being flexible on deadlines when needed. Some licensees and industry associations GAO interviewed said that extensions can provide needed flexibility when unexpected problems occur. Some concerns were raised, however, that granting extensions can undermine buildout requirements by creating an impression that they will not be strictly enforced.

Stakeholders GAO interviewed generally said that buildout requirements are effective in meeting two of four goals commonly cited in FCC documents and statute -- encouraging licensees to provide services in a timely manner and preventing the warehousing of spectrum. Stakeholders had mixed views on the effectiveness of buildout requirements in meeting two other goals -- promoting innovative services and promoting services to rural areas -- largely because they believed that other tools could better address these goals. Other tools stakeholders mentioned include greater use of spectrum licenses that allow a wider array of uses and providing licensees with subsidies to serve rural areas.

Nearly all the licensees and industry associations GAO interviewed said they support FCC having buildout requirements, while spectrum policy experts GAO interviewed were mixed in their support of the requirements. Experts who did not support buildout requirements said that the requirements are set too weak or that other tools could better meet FCC goals, among other reasons.