House Passes Satellite TV Loan Guarantee Bill

(April 14, 2000) The House passed HR 3615, the Rural Local Broadcast Signal Act, on Thursday evening, April 13, by a vote of 375 to 37. The bill will provide federal government loan guarantees to entities which provide local into local television signals in unserved and underserved markets.

Last year Congress passed legislation to allow direct broadcast satellite (DBS) providers to carry local television broadcast signals by satellite into the broadcast station's area. However, DBS providers currently only have the capacity to provide local TV signals for the 70 largest TV markets. The bill is designed to incentivize entities to provide local into local signals for rural and small market DBS subscribers.

	Rep. Bob Goodlatte (R-VA)

The bill would accomplish this by providing federal government loan guarantees through the Rural Utilities Service at the Department of Agriculture. The bill is sponsored by Rep. Bob Goodlatte (R-VA) and Rep. Rick Boucher (D-VA), and is enthusiastically supported by legislators from rural districts.

While both this bill, and the Senate's version, are commonly understood to be "satellite bills" and "television bills", both are written in technology neutral terms. They are hypothetically open to the possibility that the local TV signals would be provided via Internet protocol technologies, including MMDS and LMDS, which might also be used to provide broadband Internet access.

Virginia Tech University, which is located in Rep. Boucher's district, and which owns LMDS spectrum licenses which cover both Rep. Boucher's and Rep. Goodlatte's districts, is currently experimenting with providing broadband Internet access, but not TV signals, via LMDS, in rural southwest Virginia.

	Rep. Steve Largent (R-OK)

Rep. Steve Largent (R-OK) fought unsuccessful battles against this bill in the Commerce Committee, and on the House floor. 

"This bill is to provide government subsidies to compete with the private sector," said Rep. Largent. "That should send a chill throughout Congress."

He elaborated that loan guarantees would be available in areas where local TV signals were already available through cable operators. "You can have local into local and still be eligible to receive loan guarantees."

He also argued that a Congressional Budget Office (CBO) study had condemned the proposal. It concluded that "providing local television service in rural areas is likely to prove financially and technically risky" and was likely to result in loan defaults.

Rep. Chris Cox (R-CA) also spoke against the bill. He predicted that it will end up costing taxpayers about $400 Million because the Rural Utilities Service will end up writing off many loans.

Rep. Billy Tauzin (R-LA), the Chairman of the House Telecom Subcommitte, responded to Rep. Largent's arguments. He argued that two providers are essential. "With two providers in the market place consumers will finally be protected." He concluded: "with choice will come consumer protection of the market place."

Rep. Ed Markey (D-MA), the ranking minority member of the Telecom Subcommittee, spoke in support of the bill, but said that he hopes that the bill will be revised in conference.

He stated that the bill does not require companies to have failed to get financing on their own; rather, it assumes that they cannot.

The bill was considered under a rule which did not allow any amendments to be offered.