WASHINGTON-The Federal Communications Commission’s controversial move to the Portals in the late ’90s still haunts the agency as it tries to convince Congress to increase its budget by 13 percent.
“What you are doing is rewarding fraud. I think there was fraud practiced on this government by its high officials … The smell is so putrid,” said Rep. Harold Rogers (R-Ky.), chairman of the House commerce, justice, state and judiciary Appropriations subcommittee.
Rogers brought up the Portals-move issue at a hearing on the FCC’s fiscal year 2001 budget last week.
Recently, the FCC has taken measures, such as hiring and travel freezes, to recoup the $9.6 million rent increase associated with moving to the Portals. Instead of the freezes, the FCC would rather use $5.8 million in excess regulatory fees it has collected to pay the increased rent amount.
The FCC collects both regulatory and application-or filing-fees. Regulatory fees are a separate assessment from filing fees because regulatory fees go to offset congressional appropriations and filing fees are sent to the general treasury. The amount of regulatory fees to be collected is set each year by Congress. These regulatory fees are the same ones the wireless industry has complained are too high.
The FCC’s plan was not well received by Rogers. “To ask us to bail you out falls on deaf ears,” he said, noting that the rent is actually paid to the General Services Administration, so the Clinton administration could work with GSA to lower the rent obligation.
Kennard responded that the FCC had spoken with various government officials to no avail. “The FCC is really between a rock and a hard place … Unfortunately our pleas are falling on deaf ears all over town,” he said.
The FCC received an $18 million increase in FY 2000 after five years of flat budgets, so Rogers said he was disappointed the FCC had been unable to implement its plans to upgrade the agency’s information technology infrastructure.
Kennard agreed that it was a substantial increase but said that most of it was gobbled up by uncontrollable costs, such as the increased rent and salary increases. “I must say I feel like a whipping boy … It makes no sense to punish 2000 employees” due to something beyond the FCC’s control, he said.
In addition to collecting regulatory fees and application fees, the FCC also conducts spectrum auctions which “bring in many multiples of our budget,” making the FCC a “cash cow for the federal government,” Kennard said in fighting for the money.
Besides the move to the Portals, the subcommittee also questioned Kennard on issues such as merger reviews, digital wiretaps and building access for fixed-wireless providers.
The FCC is requesting $237 million for FY 2001 which is $27 million more than what it received in FY 2000. Hiring at the agency would be frozen at 1,975 employees.
