back in this situation again where there is this concern across the spectrum, no pun intended about folks who are concerned about this. how do we avoid getting back to this position again? ashurdly there will be other companies in the future who want to expand and grow jobs which is what we want them to do. how do we do it in a way that doesn't offend the gps situation we already have in the country and the investment that's been made there? >> the goal in that particular proceeding they're really two fundamental goals. one was to free up more mobile spectrum for broad band. we do have a significant capacity challenge that has the risk of restraining growth and private investment in mobile and the second was deregulatory. that spectrum had an old regulation on it.

prohibiti prohibiting test ree yal use. the effort was to remove the barrier from te rest ree yal mobile build out. as you saw from the actions we are taking those into account. it's an open proceeding still. we're continuing to be analyze the record. we were very clear from the start of it that we would have to address that. there's a larger issue that i do look forward to working with you, all the members of the committee. there's no reason it shouldn't be a bipartisan issue which is how do you make sure that we can remove barriers to spectrum use and that the incentives are in place to avoid interference being caused by devices being

interfered with my spectrum outside their lanes. this particular proceeding revealed that that is a real issue. it could get in the way of unleashing the full opportunities of investment innovation and terrestrial mobile broad band and say learning from we've learned from this, how do we make sure that we can move across the board to the flexible use that commissioner mcdowell and i both agree should be the norm for spectrum policy? get rid of regulations that limit use, but also have incentives to make sure that we don't wake up and say there are interference issues here that prevent us from deregulating? >> the number one rule is to pro vent spectrum interference.

beyond that i have advocated flexible uses. in the past fcc has said certain frequencies should be used by specific purposes. by the time it's built out, the market has pszed that idea by. you have to go back to the fcc with another rule making which can take years to change what the next micro management might be from the government. i think it's best to have flexible uses. as far as the light skaured issue that did not rise to a vote. >> i just think it's useful to continue to keep that situation relevant as we discuss how we're going forward. i think there were a lot of fears whether they were going to come true or not, those fears themselves i think have an impact on investment decisions that other companies make.

as they go forward there are companies making investments currently today in gps technology that may have an impact on future decisions and future lane issues that, boy, a long-term guidance, a long-term vision might avoid some of these problems down the road. there's a general concern that we were getting that they were unsure whether the fcc would assure the world that light squared or other companies competing for that spectrum would have zero impact or a negligible impact. it almost seemed like the effort we were taking should already be in the prime directive of what you're utilizing to make this directive. i don't know how we got to that notion. but that was the belief in a lot of -- in part i know you're still going through it. that was the belief that that would occur. whatever we can do i guess to re-assure those companies that are currently invested in gps

that we won't approve technology that would affect their lane would be useful and helpful going forward. i also wanted to ask just briefly about broad band fiber. just as it pertains to partnerships with public-private usage, it's my understanding that in some of the publicly funded fiber -- what is the selling or sharing of excess fiber? >> excess fiber government supported fiber? >> government supported fiber. to what extent do we have government supported fiber? is it all private sector? >> in general, this may be a question that hopefully we can follow up afterwards, i'm not sure i completely understand it. but overwhelmingly broad band infrastructure in the u.s. is private sector funned and built

in the universal service fund context there's support for private companies so that rufrl america can get broad band. there may be some local municipal broad band networks. perhaps i should offer to follow up with you. >> that would be fine. the final question i had for this round deals with airplane communication and some of this really has to deal with the faa. we constantly deal with constituents and folks related to travel and communication that occurs on airplanes even the most recent alec baldwin situation playing games as the plane was taking off. this is in the news a lot. to what extent is the fcc engaged in the ability for telecommunication devices to be utilized on airplanes and what's the opinion of the fcc related to the restrictions that currently occur on airlines today? >> i saw today the report that the faa is taking a fresh look at its rules regarding ipads and

other devices and exploring the possibility that it might adjust its rules to accommodate the new kinds of devices, the way people use that. i would encourage that. and some of the traditional concerns about people talking on phones on planes may not apply to kindles or ipads or other uses. i would encourage the faa to look at that and to ensure that it's doing as little as necessary to protect public safety. >> one more just related to mobile dtv. i have sprint based in my district. i know both of you have been advocates of auctions wireless broad band. the launch of dtv will be an important tools for consumers to access news and information in

times of emergency, what accepts is the fcc taking to make smur mobile tv will flourish and not be negatively impacted. >> we've made it clear that the flexibility that broadcasters have to launch mobile dtv on the six megahertz they have shouldn't and won't be affected by the incentive auction process. they have flexibility to launch it. i encourage innovation in the space. the market will decide whether or not it's -- it's something that will work. i think that's an area where there's no reason for the fcc to discourage innovation, just the opposite. i think we've given those assurances to broadcasters. >> appreciate it. thank you. >> you're welcome. first, let me ask you, chairman, could you submit to us the list of the 200 regulations that

you've eliminated. that would be really helpful to have them. we can use it to coerce others to follow suit. let me just ask you both a little something about the universal service fund. i think it was saturday afternoon i was meeting with some constituents who are a little mom and pop cable company. the contribution rate has doubled over the last ten years or so which has led in an increase in fees to consumers. have y'all done anything to address that particular piece of our fees and the like? >> it's something we expect to move forward with in the future on the other side of that the commissioner and i and our

colleague work together to limit the growth of those funds. on an aggregate basis that sets the fees that are collected from cob assumers. the contribution proceeding will look at the allocation of these fees basically who pays it in. the most important thing on the -- insuring that the aggregate level of burden on consumers is minimized were issues that we addressed in the proceedings that set the outflows. we do have to address contributions because the world has changed and the ways that that money is collected needs to be looked at very carefully. but i do want to emphasize that the putting the programs under budget, saving tarts has put in place an assurance that the aggregate burden on cob assumers will be within the limits we identify.

>> so why not -- so tell me how the new connect america fund will impact rural areas? >> well, it will efficiently disperse funds to local communications providers to build out broad band in their areas. over the years, a whole series of inefficiencies, waste, developed in the program. it would have been hard to say that the money that the program was distributing was going to its intended purpose and its intended purpose was traditional telephone service not broad band. the fundamental purpose was to modernize the service from tv's to broad band. eliminate waste and efficiently and ensure klablity so any money in the program gets spent on the goals of the getting connected fund getting broad band to rural

america. >> some of my small companies, i should call it a cable company because there is a difference. so they are really worried that the new changes to the connect america funds are going to put them out of business. the easiest way to make sure that there are no effects at all would have been to not constrain the size of the fund and to allow the increase in the burden on consumers to go up. we agreed on a bipartisan basis in the commission that that wasn't the right answer. that we needed to make the program efficient, accountable

and that's what we've done. we've established a waiver and other processes so as we go forward we can hear the concerns from companies. and take them into account. i mentioned one other thing a core principal of our reforms was not to have a flash cut. but to look at transition periods. the measures will roll in over the next few years because we wanted to make sure companies had time to adjust. >> are you available at 3:45 tomorrow. i have another constituent coming to talk about this. i think -- that would allow me to go to -- you can do a lot more to help her than i can. >> it may be that they're coming to us before you or after you. our doors are open and getting the input directly and

information from the companies affected is very important to us. >> i appreciate that. can you explain for the committee your thoughts on universal service fund reform? it -- what i read of what you said is you agreed with some, you had concerns about the other. some other parts and you disagreed with the other. we have not addressed the size of the university service reforms. there are four funds where we spend something under the universal service umbrella. we've gotting to most of those. we haven't gotten to the contribution or taxes side. the chairman and i talk about this on a regular basis. it's my hope that we can launch another notice of rule making as quickly as possible.

we need to expand, broaden the base of contributor and lower the contribution factor. make it a flatter tax sorts. we're taking a lot from a shrinking pool of revenue. we do need to broaden the base and reduce the overall birthday. so the sooner we can get on with that, the better. there is this automatic tax increase. it isn't a hidden tax. it does show up on consumer phone bills. it's that language regarding fees and taxes and funds and thins. it's grown from 5.5% in 1998 to 18% today. in part because of increased spending but also because of a shrinking pool. so it needs to be fixed. it needs to be fixed very

urgently. on the spending side i addressed an association of rural phone companies. we talked a lot about this area. far lot of the rural phone companies. >> you got to have the meeting with them. not the chairman because i'm sure my folks were there. excuse me more interrupting. >> 600 of them all at once from all a states, i believe or most a states, anyway. and a very honest, open discussion. i know what their concerns are. some rules start to go into effect july 1st. some rules don't phase in for a period of nine years. they have a steady income stream of $2 billion. the commission will look at this again in 2017. so five years from now.

but that is important. other the other side, some expressed their concern there's certain loans from the federal government through the department of agriculture or even some other things where they're concerned about being able to repay those loans. money boar reed for fiber deployment and other such things in rural america. if that is indeed the case. i know there's a lot of anxiety right now there's a little bit of uncertainty as to what the actual reality will be. i think the executive brachblg has an obligation to look at working out those loans if need be. we also did establish a waiver process. it's very frugal. being of scottish desent i like that's experiencing undue hardship because of the reform, they can file a waiver with the fcc where they have to open their books in a detailed fashion. we will learn a lot should that

happen. the commission's going to learn a lot about what might be happening as a direct result. i have an opportunity to bend the growth curve of an entitlement and i took that opportunity. >> that's great. we all need to do is same on lots of different entitlements. thanks for that explanation. there are some issues with the rural utility service and some of those loans and some of them being called in in spite of the fact that companies haven't yet utilized all the funds. so, we'll have to deal with that with rural development in the usda. but thank you very much. mr. chairman, we're very aware that you prepared the fiscal 2013 budget in advance of recent congressional action on voluntary incentive auctions which will greatly affect the future of spectrum availability. these will be the most complex

auctions the fcc has conducted to date. please update us on the agency's plan for these auctions as it stands now understanding that things will change as we move forward. we won't press you for a figure today, but i imagine there will be additional administrative costs associated with these auctions. can you comment on that? >> the auctions present an opportunity to raise billions for the american public. it will be incredibly complex. the two sided auction that congress authorized this will be the first of its kind. it will require a great deal of hard work, engineering work, autonomous work and we're privileged to have that responsibility. the after the is now -- the

staff is developing a plan, determining what effect it will have and most importantly developing a view on what needs to be done to maximize the benefits to the public, the benefits to the treasury. the benefits to our economy. the fcc has a good track record on delivering a major return on investment. we'd like to make sure that the challenges ahead that we don't shortchange the american public bau we don't bring the right engineering and economics resources to bear. >> now you tell us that you're at the lowest staffing level in ten years. so in have you of these responsibilities what can you tell us about the present level of staff and taking on what you need to do now. >> i'm completely in favor of having a lean, highly talented team taking on these issues.

and have no interest in looking to hire people we don't need. i am concerned in general about the engineering and economics resources at the fcc whether interference issues like they were talking about before, the complexity of auctions, there's a basic level of talent that the fcc needs to sustain over time in order to realize these benefits for the american public. so our goal is do the most we can with the fewest resources and the fewest people. as i said, i am -- we have a lot of work to do to make sure that we continue to bring in great engineers, great economists, great lawyers to meet the opportunities of mobile and broad band. >> right. >> now, we know that a feature of the an important aspect is set aside for first responders.

everyone here is concerned with that, but if you come from new york city that's an issue that's with us every day in terms of what happened september 11th. how will that go? and how successful do you think you'll be at being able to deal with that issue? >> i suspect, i'm sorry i'm interrupting you, i suspect that's an issue that will have bipartisan support. people are saying make sure that you're doing the right thing in that department? >> it's an extremely important issue. the 9/11 commission recommended that we have an inoperable mobile broad band network for first responders. it's very important thing that congress has now moved forward on that. a great deal of responsibility for implementing -- there are pieces that we will work on. we have a public safety and homeland bureau that's very focused on it. making sure that we harness

modern communications for our first responders with a mobile broad band public safety network with next generation 911, with outbound mobile alerts so they can reach people. these are very high prior to priority and in each case they present some very challenging issues to work through. >> we wish you the best because that's going to be a challenge and one everybody will be looking at. there's a question i've asked the last couple of years every agency that's come before us. it's a special -- of special interest to me. what about the territories? as you know the territories are always an afterthought in congress, in corp. america and everywhere. if you were to ask americans are the folk who is live in the territories american citizens, we may be shocked at how many -- shocked at how many americans do not know that they're talking

ant american citizens because they don't live in a state. it got so bad that a couple years ago at an fcc hearing i wanted to -- i was tole that satellite radio was not available in puerto rico and i asked why. someone sitting right there, i hope it wasn't you. no it wasn't you, said, the satellite doesn't reach there. and i said, it's a satellite. so i suggested they borrow one from the cia which can reach anywhere in the world. so now they have satellite radio. what are you hearing from the territories? which issues do they have that may be different than folks in the 50 states or continental states. and what is still missing to bring about equality under the umbrella of the fcc? >> i would say the issue we most hear is the same issue we hear from rural america which is ebb suring adequate broad band

infrastructure and broad band adoption. so whether it's the universal service fund or orpolicyings and programs that we have, we certainly look at the territories, the issues the territories have to the extent there are unique issues of course, we take those into account. but many issues are similar and hopefully that will help facilitate issues across the board. >> i must say and you can comment on this also, if you think it's rough for rural areas, and this is not a political statement. in these days rural areas all of them have two senators and a couple of congressmen or at least one to call the fcc, the territories is a whole different situation. they're treated equally only by the military. i'm speaking of that in a positive term for their service.

so i just want you to always stay on top of that as we will on the subcommittee. i know the chair has that thought with me. mr. mcdowell. >> thank you for the opportunity to speak. so we do keep them in mind, the territories. just last october i had a terrific conversation with the governor of puerto rico about the university service reform and need to make sure that all the unique circumstances were taken into consideration. whether it's upcoming spectrum auctions or other things regarding injecting more spectrum in the hands of consumers or broad band deployment or adoptions, we do take them into account very seriously and do all we can. a lot of them do have unique circumstances and we do try to incorporate that into our policies. >> thank you for that. i think it's always important 30 keep aware of what they're thinking as a certain presidential candidate found out

this weekend in puerto rico. >> indeed. >> thank you. >> mr. womack. >> i've got a couple of follow up questions. i'm not going to be near as understanding or forgiving for what my colleague brought to the intention of this panel here just a few minutes ago in regard to the number of employees that are now receiving in excess of $150,000 annually in earnings. he went through the full list. i'm just going to -- i'm going to take 2008 and 2009 and just set them side by side. because i can't imagine an explanation that can justify this. that in 2008 there were 46 and in 2009 there were 431.

unless magically hundreds of those workersing $149,000 a year and then got a raise and took them over that threshold. what i'm specifically asking is not necessarily an explanation today because there may not be one that can be supported better by what research might be able to uncover. but i sit in hearings with the national nucle administration and health institutes and other very, very high level, high energy, high bureaucracies in this government. and i would be shocked if they all came with this kind of appreciated number between 2008 and 2009. so i give you a chance just to comment about that significant jump in one year, but i do for the record would like to see the

justification and where we're headed on this glide path. >> so we certainly provide you more detailed explanation. i understand from our staff that in that period from 2008 to 2009, a certain class on the gsis pay scale went from just under $150,000 to just over $150,000. we'll get back to you on whether that is the explanation. i can certainly tell you many my time as chairman it was to say salaries of employees. i suspect that the explanation will be something like -- >> i hope so. surely you would agree that on paper in front of the discerning public that is an astonishing jump in on lik to understand th numbers better myself.