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Defense Communications: Federal Frequency Spectrum Sale Could Impair Military Operations (Letter Report, 06/17/97, GAO/NSIAD-97-131).

GAO reviewed the transfer of certain frequency spectrum from the Navy's
Cooperative Engagement Capability (CEC) Program to the Federal
Communications Commission (FCC) for reallocation to the private sector,
focusing on whether: (1) the capabilities of the CEC program could be
adversely affected by this transfer; (2) other systems could also be
adversely affected by this transfer; and (3) the Department of Defense
(DOD), FCC, and the Department of Commerce are taking appropriate and
adequate steps to prevent or minimize such impairment. GAO also
discussed potential actions that could more effectively achieve the
intent of the Omnibus Budget Reconciliation Act of 1993 to minimize
negative impacts of frequency reallocation on the federal government.

GAO noted that: (1) national security and cost implications of the
federal frequency losses to CEC and other military systems were not
fully considered in 1995 and have still not been adequately assessed;
(2) the loss of the portion of the frequency spectrum used by CEC could
reduce its capability in peacetime training operations and make it
incapable of joint (multiservice) operations similar in size to
Operation Desert Storm; (3) other current systems could be adversely
affected by an increase in mutual interference problems; (4) in
addition, new spectrum requirements for information warfare systems
could suffer from a lack of needed frequency spectrum; (5) however, the
full DOD-wide cost and operational impact from the frequency loss has
not been established because spectrum management planning in DOD is
fragmented and inadequate; (6) in some instances, prior National
Telecommunications and Information Administration (NTIA) assessments of
requirements and availability of frequency spectrum for transfer to the
public could be incomplete because of security issues; (7) security
classifications restrict release of pertinent technical information
about many DOD programs; (8) as a result, transferred spectrum is
threatened by potential interference problems; (9) DOD has cleared key
NTIA, FCC, and other federal spectrum personnel to promote better
spectrum planning; (10) however, GAO believes more effective and
cooperative actions to exchange data and establish commercial standards
can be taken by DOD, FCC, and Commerce, thus ensuring that sufficient
frequency spectrum is available to operate major national security
systems with minimal interference to, and by, commercial systems; and
(11) the licensing of frequencies affecting CEC should not begin until
DOD has completed an ongoing assessment of its total requirements and
reported its finding to the Congress and the President.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  NSIAD-97-131
     TITLE:  Defense Communications: Federal Frequency Spectrum Sale 
             Could Impair Military Operations
      DATE:  06/17/97
   SUBJECT:  National defense operations
             Radio frequency allocation
             Interagency relations
             Privatization
             Telecommunication industry
             Defense capabilities
             Military training
             Defense contingency planning
             Defense economic analysis
             Telecommunication equipment
IDENTIFIER:  Navy Cooperative Engagement Capability System
             DOD Joint Tactical Intelligence Dissemination System
             JCS Joint Vision 2010
             DOD Joint Electromagnetic Compatibility Program
             DOD Operation Joint Endeavor
             Desert Storm
             
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Cover
================================================================ COVER


Report to Congressional Committees

June 1997

DEFENSE COMMUNICATIONS - FEDERAL
FREQUENCY SPECTRUM SALE COULD
IMPAIR MILITARY OPERATIONS

GAO/NSIAD-97-131

CEC Frequency Sale

(707182)


Abbreviations
=============================================================== ABBREV

  CEC - Cooperative Engagement Capability
  DOD - Department of Defense
  FCC - Federal Communications Commission
  MHz - megahertz
  NTIA - National Telecommunications and Information Administration

Letter
=============================================================== LETTER


B-274244

June 17, 1997

Congressional Committees

As part of our evaluation of the development of the Navy's $3 billion
Cooperative Engagement Capability (CEC) program, we reviewed the
transfer of certain frequency spectrum, within which CEC operates, to
the Federal Communications Commission (FCC) for reallocation to the
private sector.  Originally, the Department of Defense (DOD) did not
concur with, but accepted this transfer.  Recently, DOD officials
have expressed concerns to the Department of Commerce and the
Congress that the loss of specific frequency bands from exclusive
military use could seriously impair how well CEC and other DOD
systems will eventually operate. 

This report discusses our analysis of whether (1) the capabilities of
the CEC program could be adversely affected by this transfer, (2)
other systems could also be adversely affected by this transfer, and
(3) DOD, FCC, and the Department of Commerce are taking appropriate
and adequate steps to prevent or minimize such impairment.  We also
discuss potential actions that could more effectively achieve the
intent of the Omnibus Budget Reconciliation Act of 1993 to minimize
negative impacts of frequency reallocation on the federal government. 
This review was performed under our basic legislative responsibility
and contains recommendations to the National Security Council, the
Department of Commerce, FCC, and the Department of Defense.  The
report also includes a matter for congressional consideration. 


   BACKGROUND
------------------------------------------------------------ Letter :1

The Navy began developing the CEC system in the 1980s as part of
general research on battle group self-defense but converted it to a
regular acquisition program in 1993.  The CEC program originated as
an improvement in ship self-defense capabilities in an open ocean
environment, but migrated to a self-defense capability for engagement
in areas close to land.  CEC is designed to distribute the same radar
and other data to all ships and aircraft (cooperating units) in the
battle group to provide each unit with the same near real-time
composite picture of the battle space. 

Each ship and aircraft transmits its own sensor data to every other
ship and aircraft within line of sight.  In turn, each ship and
aircraft receives sensor data from every other ship and aircraft and
combines that data with its own data to form a composite picture. 
This capability is expected to enhance performance against air
threats to a battle group through longer intercept ranges and
improved reaction time.  CEC remains a Navy program, but in 1993 the
Congress directed the Army and the Air Force to study CEC's potential
to perform joint air defense operations and theater ballistic missile
defense missions. 

Figure 1 shows the complex environment of the littoral battlefield in
which the CEC system is expected to operate.  The environment
includes friendly, hostile, and neutral forces; advanced cruise
missile, electronic-warfare, and tactical ballistic missile threats;
and a multitude of allied combatants with multiple sensors and
weapons that must be closely coordinated. 

   Figure 1:  Cooperative
   Engagement Capability System

   (See figure in printed
   edition.)

   Source:  Johns Hopkins Applied
   Physics Laboratory.

   (See figure in printed
   edition.)

In 1993, the Congress passed title VI of the Omnibus Budget
Reconciliation Act, which requires the federal government to provide
a span of frequencies aggregating to not less than 200 megahertz
(MHz) for allocation to the public.  The intent of the act was to
benefit the public by promoting the development of new
telecommunications technologies, products, and services that use the
frequency spectrum and by increasing the sharing of frequencies by
federal and nonfederal users.  According to a Congressional Research
Service report,\1 the auction of federal spectrum\2 is also viewed by
lawmakers as a potential source of funds for the U.S.  Treasury to
help balance the federal budget.  This is also the view of the
administration.  For example, the administration estimates it will
receive about $8 billion in auction receipts from the auction of
frequency spectrum licenses in fiscal year 1997 and about $9.4
billion in auction receipts in fiscal year 1998. 

To minimize negative impacts on the federal government, the act
requires that the spectrum to be reallocated must not be "required
for the present or identifiable future needs of the Federal
Government" [emphasis added] and should not result in costs to the
federal government that exceed the benefits gained.  Title VI allowed
federal agencies to provide justification showing why their
frequencies should not be subject to reallocation.  If a spectrum is
found to be necessary after reallocation, the President has the
authority to substitute alternate spectrum provided that the
requirements of the 1993 Omnibus act are still met. 

Management of the frequency spectrum in the United States is divided
between FCC and Commerce.  The Communications Act of 1934 established
FCC and gave it (1) authority to assign frequencies to all radio
stations, except for those owned by the federal government and (2)
broad regulatory powers in both wire-line and radio-based
communications.  The act reserved authority for assigning frequencies
to federal government stations to the President.  The President's
responsibilities for managing the federal spectrum have been
delegated to the Assistant Secretary of Commerce for Communications
and Information, who is also the Administrator of the National
Telecommunications and Information Administration (NTIA). 

The NTIA Administrator is the principal advisor to the President on
telecommunications policy.  NTIA establishes policies concerning the
use of federal spectrum based, in part, on input from the
Interdepartment Radio Advisory Committee and the Spectrum Planning
and Policy Advisory Committee.  The Interdepartment Radio Advisory
Committee consists of representatives from 20 major federal agencies
who, when in committee, are supposed to function in the interest of
the United States as a whole. 

In February 1995, NTIA identified 235 MHz of government spectrum
(instead of the required 200 MHz) in its final spectrum reallocation
report for transfer to the private sector.  This 235 MHz included 50
MHz from within the CEC operating frequency band.  The transfer of
this 50 MHz may result in the loss of up to 200 MHz of CEC's usable
operating frequencies because the Navy may have to place guard
bands\3 of up to 75 MHz on each side of the 50 MHz commercialized
frequencies to protect commercial systems from potential CEC
interference.  The size of the actual guard band needed will depend
on technical and regulatory factors such as CEC deployment scenarios,
design of the commercial receivers in the 50 MHz reallocated band,
and applicable spectrum management regulations.  The 200 MHz
represents a significant portion of the frequencies CEC was
originally designed to use. 


--------------------
\1 CRS Report for Congress, FCC Auctions:  Legislation in the 104th
Congress, (95-923 SPR, Oct.  11, 1996). 

\2 Federal spectrum refers to that portion of the frequency spectrum
used primarily by federal agencies. 

\3 A guard band is a set of unused frequencies used to guard a system
against interference to or from a system on adjacent frequency
spectrum. 


   RESULTS IN BRIEF
------------------------------------------------------------ Letter :2

National security and cost implications of the federal frequency
losses to CEC and other military systems were not fully considered in
1995 and have still not been adequately assessed.  The loss of the
portion of the frequency spectrum used by CEC could reduce its
capability in peacetime training operations and make it incapable of
joint (multiservice) operations similar in size to Operation Desert
Storm.  Other current systems could be adversely affected by an
increase in mutual interference problems.  In addition, new spectrum
requirements for information warfare systems could suffer from a lack
of needed frequency spectrum.  However, the full DOD-wide cost and
operational impact from the frequency loss has not been established
because spectrum management planning in DOD is fragmented and
inadequate. 

In some instances, prior NTIA assessments of requirements and
availability of frequency spectrum for transfer to the public could
be incomplete because of security issues.  Security classifications
restrict release of pertinent technical information about many DOD
programs.  As a result, transferred spectrum is threatened by
potential interference problems.  DOD has cleared key NTIA, FCC, and
other federal spectrum personnel to promote better spectrum planning. 
However, we believe more effective and cooperative actions to
exchange data and establish commercial standards can be taken by DOD,
FCC, and Commerce, thus ensuring that sufficient frequency spectrum
is available to operate major national security systems with minimal
interference to, and by, commercial systems. 

The licensing of frequencies affecting CEC and other DOD programs
should not begin until DOD has completed an ongoing assessment of its
total requirements and reported its findings to the Congress and the
President. 


   FREQUENCY TRANSFER COULD IMPAIR
   CEC OPERATIONAL POTENTIAL
------------------------------------------------------------ Letter :3

The Navy initiated the CEC program as an improved ship self-defense
system.  DOD and the Congress added joint and ballistic missile
defense missions to the system during its development.  These
additional missions will require an increase in the number of
frequencies over those needed for ship self-defense.  However,
according to DOD officials, the loss of up to 200 MHz\4 required to
protect non-DOD users could prevent CEC from functioning in a joint
environment or against tactical ballistic missiles during a war
similar to Desert Storm. 


--------------------
\4 According to DOD officials, recent data have shown that the size
of the guard bands could be as small as 15 MHz.  Therefore, the
amount of useable frequency the CEC could lose ranges from 80 MHz to
200 MHz.  DOD also said the President has the authority to permit CEC
to operate over the 200 MHz without concern for interference to civil
systems in the event of a national emergency in the United States. 
DOD said in an operation like Desert Storm, the host country will
determine how much spectrum CEC uses. 


      PROGRAM EXPANDED BEYOND
      INITIAL SCOPE
---------------------------------------------------------- Letter :3.1

The CEC program initially was developed to improve the Navy's ship
self-defense capability against air threats.  Subsequently, in his
testimony on the fiscal year 1997 budget, the Secretary of Defense
singled CEC out as a high-priority program and directed its
accelerated development because of its great potential for increasing
the war-fighting capability of joint service operations. 

DOD has also received congressional direction to include theater air
defense and theater missile defense as CEC missions.  The conference
report on the National Defense Authorization Act for 1997 urged the
continued acceleration and expansion of joint service integration
efforts between CEC and several Air Force, Army, and Marine Corps
theater defense programs.  The House Committee on Appropriations also
directed the Secretary of Defense to submit a detailed joint service
cruise missile defense master plan that specifically addresses the
role CEC could play compared to the role of the Joint Tactical
Intelligence Dissemination System.\5 In a 1995 memorandum to the
Secretary of the Navy, the Chief of Naval Operations also noted
potential international interest in the CEC system. 


--------------------
\5 The Joint Tactical Information Distribution System is a
communications system that supports the positive identification and
precise location of all participating platforms, reducing the
possibility of engagements on friendly units. 


      LIMITATIONS ON AIR AND
      MISSILE DEFENSE ROLES
---------------------------------------------------------- Letter :3.2

Our review indicated that as a Navy only, battle group sized system,
CEC could work in peacetime as it was originally planned, but with
some limitations on the number of participants.  However, Navy
documentation shows that with a loss of up to 200 MHz, CEC most
likely will not be a viable system in a joint environment or against
tactical ballistic missiles during a war similar to Desert Storm. 

The Chief of Naval Operations, other Navy officials, and officials
from the Office of the Secretary of Defense said that CEC probably
would have difficulty supporting joint air defense missions under
presently planned scenarios with the loss of up to 200 MHz.  For
example, the Navy expects about 100 CEC cooperating units on the East
Coast by the year 2008, including battle group assets and air defense
units.  The Navy said about 39 units are required for joint air
defense operations in a Desert Storm sized engagement, not including
amphibious units engaged in self-defense operations.  According to a
CEC program official, CEC will not have enough spectrum to support 39
cooperating units after losing such a significant portion of its
operating band. 

Navy officials said that this loss of frequency could be accommodated
in normal Navy operations in the United States.  But, they added that
joint operations cannot be supported because such applications
greatly expand the number of cooperating units required for training
and tactical operations.  These officials were concerned about
premature licensing of frequencies under the 1993 act because, once
licensed for nonfederal use, frequencies cannot easily be converted
back to military use.  They favored either delay or deferral of the
licensing of the 50 MHz until the number of joint users was
determined. 

However, FCC has begun the process of allocating and assigning
frequencies transferred from the federal government, as required by
the 1993 Omnibus act.  It has completed a rule-making action to
allocate the first 25 MHz transferred from the CEC operating
frequency range to the General Wireless Communication Service.  FCC
officials said the Omnibus act requires FCC to have issued licenses
by August 4, 1998, for at least 10 MHz of the total spectrum
reallocated from the federal government to nonfederal use, and FCC
has identified the subject spectrum (or some substitute) as necessary
to fulfill that mandate.  FCC officials said they need to know very
soon what spectrum will be available to auction to meet this
statutory requirement so that appropriate rule-making proceedings can
be conducted, proper notice can be given, an auction conducted, and
licenses issued. 

As FCC proceeds with auctioning and licensing commercial operations
in the CEC operating band, Commerce officials believe the likelihood
of the President initiating the reclaiming procedures outlined in the
1993 Omnibus act will become remote.  Therefore, according to
Commerce officials, since CEC system concepts have changed and new
information is becoming available, it is prudent to consider a delay
in the reallocation process until the results of an ongoing
comprehensive DOD spectrum study are available. 

In the conference report on the National Defense Authorization Act
for 1997, the Congress directed the Secretary of the Navy to prepare
a detailed report on progress made in resolving CEC frequency
spectrum interference resulting from loss of frequencies caused by
title VI of the 1993 act.  The Navy prepared a report in response to
the congressional direction.  However, our review indicated that the
Navy's report has significant deficiencies. 

First, it does not provide a detailed description of efforts underway
to identify means to increase the number of operating units that
could operate at any one time.  At present, total bandwidth
requirements depend on the number of users because each user requires
its own specific bandwidth.  Navy officials said they are
investigating methods of using the same bandwidth more than once
through power management and frequency scheduling techniques. 

Second, the Navy's report does not reach any conclusions on what
training restrictions would be imposed because of the lost
frequencies.  Assessing training impacts from the loss of frequencies
is important because DOD believes it must train jointly in order to
fight jointly.  The Director of the Joint Spectrum Center\6 told us
an approved joint training plan is required to fully analyze
potential interference problems.  As of March 31, 1997, DOD had not
prepared a formal training program stipulating numbers of
participants and training scenarios for joint operations because CEC
is not an approved joint program.  Navy officials expect joint
program certification after a full production decision is reached. 

DOD also said the Navy's report does not analyze which spectrum could
be substituted for the 50 MHz in question without impairing other DOD
spectrum dependent systems.  Because the federal government
identified 235 MHz for reallocation to the private sector, only 15
MHz would be needed to reach the legally mandated 200 MHz. 


--------------------
\6 The Joint Spectrum Center serves as the DOD center of excellence
for electromagnetic spectrum matters in support of the Director for
Command, Control, Communication and Computer Systems of the Joint
Staff; the Office of the Assistant Secretary of Defense for Command,
Control, Communications, Computers, and Intelligence; the Unified
Commands; military departments; and defense agencies.  It also
supports the electronic protect missions of information warfare as
they relate to spectrum supremacy. 


   ADVERSE EFFECTS ON OTHER DOD
   PROGRAMS LIKELY
------------------------------------------------------------ Letter :4

DOD has indicated that current and future spectrum reallocations
could result in significant degradations in the capabilities of many
major weapon systems and cost DOD hundreds of millions of dollars to
modify systems and/or rent frequencies from the private sector or
foreign governments. 

In his fiscal year 1998 posture statement before the House Committee
on National Security, the Chairman of the Joint Chiefs of Staff
expressed a strong concern about reductions in the availability of
frequency spectrum for DOD systems.  He said: 

     The military is also facing a new challenge from the commercial
     and international sectors over an issue no one anticipated 20
     years ago:  availability of the frequency spectrum.  In the rush
     to provide 'bandwidth' ...  it is critical that future spectrum
     sales take the impact on defense systems into account.  There is
     potentially a significant dollar impact involved in this issue. 
     If DOD has to yield portions of the spectrum to new commerce,
     existing military equipment operating within these frequencies
     must be replaced with systems that can operate on other portions
     of the spectrum. 

Officials from the Air Force Frequency Management Agency said
operational degradation must be accepted in many systems because no
other frequencies are available to replace the transferred
frequencies.  For example, they anticipate the loss of test range
frequencies (1452-1525 MHz) to constrain a wide range of DOD and
civilian aircraft flight tests, potentially delaying the aircrafts'
development schedule.  They also anticipate problems in high power,
highly mobile, air defense radar operations caused by the loss of
frequencies now used as guard bands to prevent interference with
civilian users.  According to DOD officials, this, in effect, moves
the frequencies of widely deployed civilian and commercial systems
closer to frequencies of these radars.  They said this increases the
likelihood of interference unless adequate steps are take by the
private sector, such as establishing receiver selectivity standards. 

In commenting on our draft report, the National Security Council said
the issue is potentially much broader in scope than the impact of the
planned federal spectrum auction on the Navy CEC program.  The
Council said the U.S.  armed forces are rapidly moving toward an
information-intensive style of warfighting as described in Joint
Vision 2010,\7 which will generate much greater demands on the radio
frequency spectrum through high communications connectivity
requirements.  The council said current problems could be but a
prelude to much larger and more difficult problems in the future. 

Thus, a more critical problem for DOD is identification of
frequencies needed to support new information warfare requirements. 
For example, Army spectrum management officials told us that
frequency requirements for the Army digitized battlefield were not
considered during the frequency reallocation review process in 1993
because this effort was not even a concept at that time.  They said
the Army is studying frequency availability issues for the digitized
battlefield, but the results are not available at this time.  Army
frequency needs for the digitized battlefield could be significantly
increased over prior requirements.  An Army summary of the March 1997
Advanced Warfighting Experiment at the National Training Center said
the Army used many new systems, which resulted in a 42-percent
increase over normal requirements at the training center.  The Army
obtained sufficient spectrum by special, one-time arrangements with
FCC and other federal agencies. 


--------------------
\7 Joint Vision 2010 is the conceptual framework intended to provide
dominant battlespace awareness, mobility, and accelerated operational
tempo.  The basis for this framework is found in the improved
command, control, communications, and intelligence that can be
assured by information superiority.  Information superiority is based
upon the capability to collect, process, and disseminate an
uninterrupted flow of information, while denying this capability to
the energy. 


   FULL EFFECTS OF THE 1993 ACT ON
   DOD UNDETERMINED
------------------------------------------------------------ Letter :5

DOD has not completed a comprehensive frequency spectrum requirements
analysis of its weapon systems to support its claims of adverse
operational impact on these systems from loss of frequencies. 
Consequently, DOD's cost and operational impact estimates to
implement changes resulting from the act vary widely; however, even
the lowest estimate is significant.  In large part, this problem
exists because DOD's spectrum management is fragmented and
inadequate. 


      FULL IMPLICATIONS NOT YET
      KNOWN
---------------------------------------------------------- Letter :5.1

The 1993 act required the government to prepare a plan identifying
which parts of the radio frequency spectrum could be made available
to the public within 15 years.  This plan was prepared by NTIA with
input from DOD and other federal agencies and provided to the
agencies, the Congress, and the public for comment.  A Deputy
Director for Communications in the Office of the Secretary of Defense
for Command, Control, Communications, Computers, and Intelligence
said DOD did not fully concur with the plan, but it dropped its
objections even though it appeared inevitable that spectrum vital to
the military would account for the majority of the spectrum
transferred from the government sector to the private sector. 

DOD did not have an adequate planning and management process in place
in 1993 to assess the full implications of the 1993 act.  DOD still
does not have an adequate planning and management process today to
assess impacts of the 1993 act and prepare plans to mitigate negative
impacts to operational readiness where they may occur.  According to
Joint Staff officials, DOD did not initiate a comprehensive spectrum
requirements analysis until 1995 when the Chairman of the Joint
Chiefs of Staff asked his staff what the impact of the lost spectrum
would be on all systems, and they did not know.  Joint Staff members
told us the Joint Spectrum Center has a DOD-wide data collection
effort underway to prepare a database that will be used as a "tool"
to allow DOD management to make better decisions on operational
impacts to DOD systems caused by frequency spectrum transfers. 
According to Joint Staff officials, the database will be used to
identify frequencies that DOD (1) must retain for exclusive use, (2)
can share with the private sector, or (3) can give up to the private
sector. 

According to DOD officials, effective use of the database the Joint
Spectrum Center is preparing could be very limited because DOD
acquisition personnel are not generally aware of mandated DOD,
national, and international spectrum management processes and
policies.  DOD officials also told us that the study was undertaken
to respond to future legislation, not to measure the impact of the
1993 Omnibus act.  However, our review of the data collection
instrument showed the instrument can be used to examine the impacts
of the 1993 act.  As noted in our November 13, 1996, correspondence
to DOD,\8 the Joint Spectrum Center had identified 154 systems as key
or representative (including CEC) out of over 2,000 systems operating
in 15 frequency bands, during initial phases of this study. 

DOD officials said final policy decisions on the Joint Spectrum
Center study will be made jointly between the military departments
and the Office of the Assistant Secretary of Defense for Command,
Control, Communications, Computers, and Intelligence.  However, at
the time of our review, DOD had not written a formal directive
establishing the purpose of the study, who will implement any
findings and recommendations, or when it will be completed. 

In addition, DOD is not coordinating ongoing studies by the Ballistic
Missile Defense Office and the Navy with the Joint Spectrum Center
effort.  At the time of our review, the Navy report on CEC
interference had not been coordinated with the Military
Communications Electronics Board or the Joint Spectrum Center.\9
According to DOD officials, the Spectrum Center should be involved in
the deliberations about mutual interference between CEC and other
Navy systems.  The Joint Spectrum Center is responsible for the DOD
joint electromagnetic compatibility program, which includes providing
analyses to DOD components and other federal agencies on a
reimbursable basis. 

In another example, the Navy has proposed reusing or sharing
frequencies still available to CEC within a battle group using
geographic separation and power management techniques.  As of
February 1997, Communications Board staff said the Navy was not
working with them to develop any methods to resolve the spectrum
sharing requirements for CEC, nor were they aware of the Navy's
proposals.  For example, the Navy's CEC program plan to reuse
frequencies in separate geographical areas of the battle group and/or
theater was not known to the Communications Board staff.  Spectrum
Center staff told us they had discussed this proposal with the Navy
several years ago, but the Navy was not interested at that time. 
According to Communications Board and Spectrum Center staff, the
proposal is a good idea if it can be properly managed. 

A September 1996 Office of the Secretary of Defense message noted
that many of DOD's frequency spectrum management problems stem from
the lack of compliance by the individual services with the frequency
spectrum management and analysis requirements called for in the DOD
acquisition directives.  The message also stated that the information
required in the certification process is critical to the defense of
DOD frequency needs and requested that the Air Force and the Navy
duplicate an Army action to ensure that frequency certification
procedures were followed. 


--------------------
\8 Numbered correspondence to DOD regarding the CEC sale of frequency
spectrum, GAO/NSIAD-97-40R, dated November 13, 1996. 

\9 The Military Communications Electronics Board, and its
substructure, is the organization within the Joint Chiefs of Staff
where the executive military Communications Electronics personnel
determine joint operational spectrum policy. 


      DOD'S ESTIMATED COSTS DUE TO
      REALLOCATION VARY WIDELY BUT
      ARE POTENTIALLY SIGNIFICANT
---------------------------------------------------------- Letter :5.2

Cost estimates within DOD to implement changes resulting from the
1993 act vary widely, but even the lowest cost estimate is
significant.  For example, a Joint Staff official believes that the
actual cost of implementing the act will be substantially more than
the original DOD estimate of about $240 million.  The Commerce
Department's final spectrum reallocation report contains DOD-supplied
data showing DOD's direct costs to redesign system frequencies could
be about $930 million.  The report emphasized that these direct costs
did not include costs associated with operational impact or program
delays that might result from redesign of systems.  An official from
the Office of the Assistant Secretary of Defense for Command,
Control, Communications, Computers, and Intelligence said the
estimated cost to CEC could be $1 billion and could cause a 5-year
delay in the program. 

DOD officials are reluctant to provide specific estimates because
they believe the total cost of the frequency reallocations on DOD
systems cannot be known accurately until the use of the frequencies
is actually lost and the new commercial user is known.  According to
the Assistant Secretary of Defense for Command, Control,
Communications, Computers, and Intelligence, problems with mutual
interference between commercial and DOD systems will require that
some DOD equipment be modified to accommodate new frequencies.  In
other cases, DOD might have to acquire new equipment because the old
equipment cannot be modified.  In addition to the equipment changes,
logistical and training support must be changed and requirements to
support new equipment must be added. 

DOD's planning process is inadequate because it hinders development
of accurate cost estimates for current or future frequency transfers. 
For example, we asked representatives of the Air Force Frequency
Management Agency for information on the cost to comply with the 1993
act and actions taken to move affected systems to other frequencies
beyond what was previously provided to NTIA.  They said they did not
have documentation for much of the information requested concerning
cost and schedules for changes to equipment that must be transferred
to another frequency because it was not required under the 1993
Omnibus act.  They said the frequencies of several systems had been
transferred, but they only knew of some planning for other major
defense systems because the systems are not scheduled to transfer
until 1999. 

Potential actions by foreign countries to charge for use of their
frequencies also complicate the development of accurate estimates. 
Military Communications Electronics Board staff characterized the
issue of foreign restrictions and charges for their spectrum use as a
minor problem today that could become much worse unless adequate
measures are taken soon.  These officials believe that if other
countries also sell government spectrum to their commercial users,
the United States may have to pay hundreds of millions of dollars in
charges for spectrum use worldwide.  In a 1995 survey of military
theater commanders, the Military Communications Electronics Board
found several examples of foreign governments considering charging
the United States for the use of the frequencies.  A Joint Chiefs of
Staff official said the United Kingdom and a number of other nations
have proposed charging fees for use of their frequencies.  These
officials said that during Operation Joint Endeavor, the United
States and the North Atlantic Treaty Organization had to negotiate
with the host nation to prevent being charged for frequency use. 


      DOD SPECTRUM MANAGEMENT
      RESPONSIBILITY FRAGMENTED
      AND INADEQUATE
---------------------------------------------------------- Letter :5.3

DOD must have a good planning process to document its requirements
and present a coherent DOD-wide strategy to satisfy these
requirements in the face of competing interests for available
spectrum and introduction of new and more efficient technologies. 
Technological advances are fueling a worldwide demand by the private
and commercial interests for increased use of the spectrum through
such uses as entertainment broadcasts, wireless personal
communications, and public health and safety devices.  The Congress
and the executive branch have responded to these demands, and, at the
same time, are attempting to address the budget deficit by
reallocating spectrum from the federal government and licensing it to
nonfederal users. 

However, a DOD study\10 commissioned to the Institute for Defense
Analysis concluded that DOD's top-level spectrum management structure
for planning, policy, and oversight was diffuse and weak.  The study
found no single high-level DOD point of contact for spectrum
management matters.  According to the study, the current management
structure has many management organizations with complex interactions
and inadequately documented procedures.  It said that the
Communications Board Frequency Panel should be the central authority
for frequency matters but that most influence is vested within the
individual services.  The study said the current arrangement presents
problems in coordinating and exercising oversight within DOD and
interfacing with outside organizations because each service
represents itself directly to NTIA and other organizations outside
DOD.  According to the study, the Office of the Secretary of Defense
and the Joint Staff also lack adequate staff and resources to
implement long-range planning. 

The study said more communications, coordination, and cooperation are
needed among the different spectrum organizations within DOD and
between DOD and non-DOD organizations to develop and enhance spectrum
sharing procedures.  The study found that prior efforts to
consolidate DOD spectrum organizations tried to do too much in one
step.  For example, in September 1994 the Joint Spectrum Center was
established to consolidate DOD spectrum management activities. 
Service frequency management offices and resources were merged into
the Center, with the Defense Information Service Agency designated as
the executive agent. 

The study said, however, that while this consolidation was
technically feasible, it was politically unattainable because of
perceived unreconcilable differences among service approaches to
spectrum management and opposition to joint management.  Thus, in
November 1995, spectrum management activities were "deconsolidated"
because the chiefs of Army, Navy, and Air Force Command, Control,
Communications, Computers, and Intelligence organizations requested
that each service retain its own frequency management office.  The
Center did retain responsibility for supporting theater commanders,
developing a DOD-wide spectrum management information system, and
maintaining a DOD electromagnetic effects program. 

The study laid out an alternative, phased approach to full
consolidation by establishing a series of steps directed to a
long-range objective.  Under this approach, the Communications Board
frequency panel would be elevated in stature to a joint board within
the Joint Staff and given more focus on long-range planning and
policy development.  A second step would consolidate service
frequency management responsibilities in the United States.  A third
step would merge individual service organizations into a single DOD
organization.  A fourth step would merge this organization with the
Joint Staff frequency board, and a fifth step would create a Defense
Spectrum Management Agency.  DOD told us that steps one and two are
viable at this time, but did not indicate when action will be taken. 
DOD also did not specify exactly what authority and responsibility
the new board will have or when and whether a full consolidation of
individual service responsibilities was intended. 


--------------------
\10 An unpublished study prepared by the Institute for Defense
Analysis, entitled An Evaluation of DOD Spectrum Management
Organizational Structures, August 16, 1996.  The study was
commissioned by the Assistant Secretary of Defense for Command,
Control, Communication, Computers, and Intelligence to evaluate
current spectrum management organization, identify any weaknesses,
and recommend organizational solutions, but it was never officially
published by DOD. 


   INADEQUATE ACTIONS TAKEN TO
   PREVENT OR MINIMIZE IMPACT ON
   OPERATIONS
------------------------------------------------------------ Letter :6

The 1993 act requires the Department of Commerce and FCC to conduct
joint spectrum planning for issuing licenses and sharing spectrum
between federal and nonfederal users.  These agencies are
specifically required to take actions necessary to promote the
efficient use of the spectrum, including spectrum management
techniques to promote increased shared use that does not cause
harmful interference as a means of increasing commercial access. 

Increased spectrum sharing is hindered by a lack of full cooperation
among DOD, FCC, and Commerce.  National security concerns in DOD
programs have impeded a full evaluation of security implications in
an unknown but significant number of major programs affected by the
1993 act.  National security implications in future reallocations
could be similarly affected.  Steps to prevent or minimize negative
impacts to DOD programs from frequency losses have been inadequate
because (1) DOD, FCC, and Commerce have not fully cooperated with
each other to exchange necessary technical data and (2) no consensus
exists among these agencies about the need for performance standards
for commercial receivers and how such standards should be
established. 


      NATIONAL SECURITY
      RESTRICTIONS CAN LIMIT FULL
      EVALUATION OF DOD PROGRAMS
---------------------------------------------------------- Letter :6.1

Specialized classification of programs and data within those programs
can present impediments to a full assessment of national security
concerns during strategic frequency spectrum planning.  For example,
DOD and Commerce officials told us that the initial impact and costs
of the frequency loss on special access military systems were either
underestimated or not fully considered when DOD approved the 1995
NTIA reallocation plan.  One reason this problem occurred, according
to DOD officials, was that frequency managers were not aware of many
"special" program frequency requirements.  An Air Force frequency
management official told us that in prior years, many spectrum
managers were not properly cleared to discuss the technical issues of
frequency management in classified programs and managers of these
classified programs were reluctant to talk to spectrum managers about
frequency use requirements.  However, according to DOD officials,
more DOD, FCC, and NTIA spectrum management personnel have been
granted clearances to these classified programs, which has improved
coordination among agencies. 

A Navy official told us CEC program officials did not initially
identify their full spectrum requirements to the civilian agencies in
1993 because these frequencies were classified wartime requirements. 
The official is concerned that the same security concerns are also
limiting a full review of other programs that are highly classified
and whose frequencies cannot be reflected in public records. 
However, the Navy said it is important that wartime operations be
taken into account to preclude disruption of any vital civil services
that may be placed into the reallocated bands as a result of the 1993
act. 

Concerns with releasing classified or sensitive information to the
public have affected FCC and NTIA studies of federal and nonfederal
spectrum requirements.  In a September 1996 report written by the
Public Safety Wireless Advisory Committee\11 on spectrum requirements
for public safety, DOD objected to any reallocation of the 380-399
MHz band to public safety uses, even on a shared basis, because it is
a North Atlantic Treaty Organization common use frequency band.  DOD
stated that this band is standardized with U.S.  military allies
throughout the world for interoperability during combined actions and
that national security considerations preclude its use domestically. 

DOD also stated this spectrum supports many diverse and high-powered
tactical requirements critical to DOD command and control operations
and that it was concerned about the potential of electromagnetic
interference to public safety users.  In addition, public safety use
could severely limit DOD's ability to "train as it fights" due to
concerns of interfering with public safety operations.  The Public
Safety Wireless Advisory Committee did not hold detailed discussions
of this issue because some of the information was classified.  This
committee recommended that representatives of the civilian agencies
with appropriate security clearances discuss this issue further with
DOD. 


--------------------
\11 A joint federal advisory committee sponsored by FCC and NTIA. 
The committee is tasked with providing advice on specific wireless
communications requirements of public safety agencies through the
year 2010 and making recommendations for meeting these needs. 


      EXCHANGE OF TECHNICAL
      INFORMATION BETWEEN FEDERAL
      AND NONFEDERAL USERS IS
      INEFFECTIVE
---------------------------------------------------------- Letter :6.2

The Assistant Secretary for Communications and Information of the
Department of Commerce and the Chairman of FCC are required to
conduct joint spectrum planning.  These officials are charged to
promote the efficient use of the spectrum, including spectrum
management techniques for increased shared use of the spectrum on a
non-interference basis.  Both Commerce and FCC acknowledge that a
major cause of frequency interference between federal and nonfederal
users is the lack of information sharing about the technology used in
equipment and agree that this information should be collected and
shared.  Two key problems impair the ability to share this
information. 

First, FCC and NTIA officials disagreed on what information is needed
to minimize mutual interference and who is responsible for providing
this information.  NTIA officials said highly technical data on
spurious emissions and harmonic outputs requiring special equipment
and costly testing are required.  FCC officials say only general data
on emissions, such as power levels and geographical location of
emissions, are required.  With respect to who is responsible for
collecting this data, DOD and NTIA officials indicated that frequency
sharing between DOD's systems and nonfederal systems would be more
effective if DOD had more information on nonfederal licensees and the
technical characteristics of their equipment.  However, FCC took an
opposite position and said,

     In most ...  cases where military systems have caused
     interference to commercial systems there was inadequate
     information available to guide the commercial system designers
     with regards to signals from adjacent bands.  We believe the
     timely information on the general nature and strength of (DOD)
     signals in adjacent bands will result in robust commercial
     system design. 

Second, no matter how they define it, FCC and NTIA agreed the
information they seek is not available, and no mechanism exists to
collect and transfer this information.  Although NTIA collects some
data on federal agencies' requests for frequency use, which is made
available to FCC, both agencies agreed that the data they deem
necessary for FCC and NTIA coordination to reduce mutual interference
is not collected for approval of federal frequency requests. 


      NO CONSENSUS ON
      ESTABLISHMENT OF COMMERCIAL
      RECEIVER STANDARDS
---------------------------------------------------------- Letter :6.3

DOD and Commerce believe that effective receiver designs and
standards are needed to promote efficient use of the radio spectrum;
there is, however, no clear consensus on how this should be
accomplished.  FCC lacks the specific authority to mandate commercial
receiver standards, and FCC officials believe that the disadvantages
of imposing such standards outweigh the potential benefits. 

The Undersecretary of Defense for Acquisition and Technology stated
that for the CEC system, a 75-MHz guard band is required on both
sides of the reallocated 50 MHz to prevent interference with new
commercial users.\12

However, he stated that most of these guard bands could be recaptured
by initiating technologically feasible requirements for improved
selectivity and spectral control for commercial receivers.  According
to the Undersecretary, the time to initiate these requirements is
before or simultaneously with the allocation of a frequency band to
new commercial users. 

DOD officials later said recent information indicated that the guard
band might be as little as 15 MHz.  However, the Commerce Department
said the guard band required to limit interference to commercial
receivers is a complex issue and has not been resolved.  The Commerce
Department said only minimal FCC regulations will apply in upcoming
auctions, and worst case assumptions must be used in spectrum
management decisions.  Commerce also said one factor is the design of
commercial receivers in reallocated bands.  Commerce agreed with DOD
that efficient spectrum use is predicated upon adopting effective
receiver designs that reduce the need for large guard bands. 
According to the February 1995 NTIA spectrum reallocation final
report,

     Several bands identified for reallocation in the final plan are
     adjacent to bands that will continue to be used for high-power
     Federal systems, including megawatt radars.  Numerous case
     histories exist where commercial or consumer radio systems
     received interference and failed to operate properly because of
     inadequate receiver filtering.  In order to achieve the goals
     set by Title VI for development of new technologies, adoption of
     effective receiver standards, either regulatory or established
     by industry, is essential for bands identified in the final plan
     that are adjacent to high-power Federal systems. 

Commerce said NTIA, in its spectrum management role for federal radio
communications systems, has adopted stringent receiver standards
applicable to most federal radio receiving equipment.  Commerce said
these standards have proved effective in ensuring efficient use of
federal spectrum resources. 

Although the Communications Act of 1934 gave FCC broad authority to
regulate radio transmitters, the Congress has acted to provide
specific authority to FCC where the public interest required the
regulation of nontransmitting receiving equipment.  As the conference
report on the Communications Amendments Act of 1982 observed: 

     Many believe that the Commission does not now have authority to
     compel the use of protective devices in equipment that does not
     emit radio frequency energy sufficient in degree to cause
     harmful interference to radio communications.  Manufacturers and
     retailers also believe that the Commission cannot require a
     label on equipment or the supplying of a pamphlet of the
     possibility of interference and outlining corrective measures. 
     The Commission has thus far acted in consonance with this
     belief.  The Conference Substitute would thus give the FCC the
     authority to require that home electronic equipment and systems
     be so designed and constructed as to meet minimum standards for
     protection against unwanted radio signals and energy.\13

In this act, the Congress granted FCC specific authority to establish
minimum radio frequency reception standards for electronic home
entertainment equipment.  Similarly, the Congress has granted FCC
specific authority to regulate scanning receivers and require that
televisions be able to receive all television frequencies, provide a
closed captioning capability, and have the capability to block
programs having a certain rating.  There is, however, no similar
provision in the Communications Act of 1934 that gives FCC specific
authority to regulate commercial receivers. 

Moreover, FCC officials questioned why regulatory standards were
needed.  FCC believes that setting such standards would hinder
flexibility and innovation in design and production, increase the
cost to manufacturers and consumers, and reduce the number and scope
of technically and economically feasible applications.  As we noted
in the preceding section, FCC officials said if adequate information
about government systems were made available to commercial
manufacturers, the private-sector industry could design systems to
avoid interference without regulated standards. 


--------------------
\12 Memorandum dated Jan.  27, 1996, to the Assistant Secretary for
Communications and Information at the Department of Commerce. 

\13 H.  R.  Conf.  Rept.  97-765, 1982 U.S.  Code Congressional and
Administrative News 2261, 2266. 


   CONCLUSIONS AND RECOMMENDATIONS
------------------------------------------------------------ Letter :7

Implementation of the 1993 act by DOD, FCC, and the Department of
Commerce leaves many risks and unanswered questions.  First, DOD has
a study underway to determine its frequency requirements; but until
that study is completed, it is not in a position to fully assess the
implications of the 1993 act or future legislative actions to
transfer additional federal spectrum to non-federal users.  Most
importantly, without the study DOD cannot fully assess the risks of
inadequate frequency spectrum to support its central warfighting
strategy--information dominance--through the year 2010. 

Second, DOD does not have an adequate planning process to evaluate
study findings and translate them into a coherent DOD policy.  Thus,
DOD risks using a negotiation process between itself and the
individual services that does not guarantee full protection of its
high-priority requirements. 

Third, transfer of the federal spectrum under the 1993 act before FCC
and Commerce have resolved their differences on key issues runs
unnecessary risks of mutual interference between users, operational
degradation of DOD communications systems, and unrealized potential
for frequency sharing.  For example, the FCC position is that
government imposed standards on commercial receivers is bad public
policy.  This is in direct contrast to the Commerce position that, in
the absence of industry standards, governmental standards are
necessary to prevent mutual interference and to promote frequency
sharing.  We note that reduction of mutual interference and increased
frequency sharing are key objectives of the 1993 act. 

A fourth, and overriding risk is that the above issues may not be
subjected to a governmentwide evaluation that encompasses both
national security issues and public benefits. 

The following recommendations are made to minimize these risks. 


      RECOMMENDATIONS TO THE
      SECRETARY OF DEFENSE
---------------------------------------------------------- Letter :7.1

In our opinion, fragmented DOD management responsibilities have
resulted in inadequate coordination within DOD on spectrum issues and
preparation of long-range plans.  We also believe DOD's ongoing
analysis of spectrum requirements for critical systems needs to
address the extent operational effectiveness of these systems will be
affected by loss of frequency spectrum from the 1993 act.  Therefore,
we recommend that the Secretary of Defense take the following
actions: 

  Assign responsibility for overall DOD spectrum management to a
     specific organization. 

  Expand and complete the ongoing DOD study.  The study should
     include analyses on how (1) the transfer of the 50 MHz in the
     CEC band and other transfers of federal frequency spectrum to
     the commercial sector could affect CEC and the other critical
     military systems in its study and (2) DOD plans to modify CEC
     and other critical systems, including estimated costs and
     schedule, to compensate for operational degradation caused by
     the transferred spectrum. 

  Submit the results of the study to the President for his use in
     considering whether to reclaim the transferred 50 MHz spectrum. 

  Submit the results of the study to the Congress including, if
     necessary, proposals for legislative modifications. 


      RECOMMENDATION TO THE
      CHAIRMAN, FCC
---------------------------------------------------------- Letter :7.2

We believe DOD should be permitted a reasonable time to complete its
study and for the Congress to consider the study's conclusions and
recommendations before additional auctions of licenses for
transferred frequencies continue.  Therefore, we recommend that the
Chairman, FCC, suspend plans for auctioning the 50 MHz from the CEC
operating band and other transfers of spectrum until the Congress and
the President have reviewed the DOD report transmitting the results
from the ongoing review of its frequency requirements. 


      RECOMMENDATION TO THE
      SECRETARY OF COMMERCE AND
      THE CHAIRMAN, FCC
---------------------------------------------------------- Letter :7.3

We believe FCC and Commerce need to resolve outstanding issues
concerning the exchange of technical information associated with
lowering mutual interference and increasing frequency sharing with
specific focus on the desirability of FCC having the authority to
regulate commercial receivers.  Therefore, we recommend that the
Chairman, FCC, and the Secretary of Commerce submit a joint report to
the Congress on their progress in implementing the 1993 act
requirements on joint spectrum planning, any unresolved issues, and
impediments to the resolution of these issues, including proposals
for legislative modifications. 


      RECOMMENDATION TO THE
      NATIONAL SECURITY COUNCIL
---------------------------------------------------------- Letter :7.4

The single body able to provide a governmentwide overview of security
concerns and public benefits is the National Security Council. 
Therefore, we recommend that the Assistant to the President for
National Security Affairs, in his role of integrating all aspects of
national security policy (1) review actions taken as a result of the
above recommendations for national security implications, and (2) on
the basis of his findings, advise the President whether he should
exercise his authority to recover the 50 MHz in the CEC program for
federal government use and how he should proceed with any future
proposals for transfer of DOD-assigned federal spectrum. 


   MATTER FOR CONGRESSIONAL
   CONSIDERATION
------------------------------------------------------------ Letter :8

As expressed by the National Security Council, the problems discussed
in this report could be a prelude to more problems in the future. 
The absence of a consensus by key federal agencies on spectrum
management issues--most recently illustrated by the divergent views
expressed in their comments to a draft of this report--suggests the
need for a comprehensive evaluation on their part.  Furthermore, full
and complete consideration of technical options that could better
achieve congressional objectives of increased frequency sharing and
more efficient use of the frequency spectrum are perceived by some
agencies as being hindered by legally required actions, and lack of
authority. 

We are making recommendations in this report aimed at establishing
agency consensus and identifying, if needed, any proposals for
legislative modifications these agencies feel are necessary. 
Accordingly, to allow these agencies time to complete their
evaluations, the Congress may wish to relax FCC's deadline of August
4, 1998, for issuing licenses for 10 MHz of the reallocated 50 MHz of
CEC spectrum. 


   AGENCY COMMENTS AND OUR
   EVALUATION
------------------------------------------------------------ Letter :9

The National Security Council, FCC, and the Departments of Commerce
and Defense were given the opportunity to comment on a draft of this
report.  Their comments indicated that the individual agencies have a
wide range of views on how to deal with the problems we have
identified and reflect the fact that they have not reached a
consensus on what to do. 

The National Security Council fully concurred with our conclusions
and recommendations and stated that the problems we identified could
be a prelude to much larger and more difficult problems in the
future.  Commerce indicated that our report provided a thorough
review of the issues and stated that it had no specific objections to
any of our recommendations.  DOD stated that it was "extremely
concerned" with our recommendations and cited concerns about meeting
the criteria in the 1993 act.  FCC expressed concern that (1) the
overall thrust of the report incorrectly implies that the primary
problem was a result of its action or plans, (2) the report glosses
over key elements of the 1993 act that require it to issue licenses
for the use of at least 10 MHz of the spectrum by August 1998, and
(3) the report does not identify meaningful solutions to the
fundamental problems of federal government spectrum management. 

Our analysis of the comments from DOD and FCC indicates that both
agencies are concerned about complying with the 1993 act.  DOD stated
that it had considered recommending outright delay or deferral of the
auction of the CEC band but decided that this would require the
identification of another band that met the criteria of the 1993 act,
an action that would impact other critical DOD programs.  FCC also
stated its concern about complying with the statutory requirement,
indicating that delaying the decision on auctioning the spectrum
would impair its ability to comply with the explicit language of the
1993 act. 

The following illustrates the differences in responses of DOD and
FCC.  DOD stated that it had an initiative underway to assess its
spectrum requirements focusing on bands that may be targeted for
future reallocation and that any further study of bands already
reallocated would be nonproductive.  However, FCC indicated that the
option for the President to recover the spectrum according to the
criteria and rules laid out in the 1993 act should be more fully
analyzed in conjunction with the DOD study of its spectrum
requirements. 

In another example, FCC indicated that (1) the benefits of new
performance standards for commercial receivers would be outweighed by
their disadvantages and (2) even if it were to determine that such
standards were in the public interest, imposing them would do nothing
to improve the management of the federal government system.  DOD, on
the other hand, asserted that it was working with FCC to recapture
most of the CEC frequency spectrum as well as improve utilization
across all frequencies by having FCC institute improved, stringent
performance requirements for commercial receivers. 

To help identify the statutory obstacles that agencies may perceive
as standing in the way of successfully resolving these issues, we
have added a matter that the Congress may wish to consider. 

The comments from the four agencies are reprinted in appendixes I
through IV, along with our evaluations of them.  DOD, Commerce, and
FCC also provided suggested technical and editorial changes, which we
incorporated in the text where appropriate. 


   SCOPE AND METHODOLOGY
----------------------------------------------------------- Letter :10

To determine if the capabilities of the CEC system would be affected
by the transfer of 50 MHz to private users, we interviewed officials
from the Office of the Secretary of Defense, the Navy, the Department
of Commerce, FCC, the Joint Spectrum Center, the Military
Communications Electronics Board, and Johns Hopkins Applied Physics
Laboratory.  We also examined pertinent documents on the specific
impact of frequency reallocations on CEC operations.  We discussed
plans the program office was developing to mitigate the impact of the
reduced frequency spectrum on the operational performance of the CEC
system. 

To determine whether other combat-related military systems would be
adversely affected by the transfer of frequencies under the 1993 act,
we interviewed officials from the Office of the Secretary of Defense,
the Department of Commerce, FCC, the Joint Spectrum Center, the
Military Communications Electronics Board, and Johns Hopkins Applied
Physics Laboratory.  In addition, we met with frequency spectrum
managers from all of the services to discuss the procedures followed
during frequency reallocation discussions in 1993-1995, which led to
the development of the final frequency reallocation plan produced by
Commerce.  We discussed the rationale for making the reallocation
decisions, as reflected in the reallocation report. 

To determine what actions DOD, FCC, and NTIA were planning to
minimize impairments to DOD systems, we interviewed officials from
the Office of the Secretary of Defense, the Army, the Navy, the Air
Force, the Department of Commerce, FCC, the Joint Spectrum Center,
the Military Communications Electronics Board, and Johns Hopkins
Applied Physics Laboratory.  We reviewed agency documents, statutes,
regulations, and federal laws regarding frequency applications by
military and commercial users.  We discussed the impact of the
reallocations on these systems and identified actions these programs
intended to take to compensate for the frequency reallocations. 

We performed our work from July 1996 through May 1997 in accordance
with generally accepted government auditing standards. 


--------------------------------------------------------- Letter :10.1

We are sending copies of this letter to other appropriate
congressional committees; the Director, Office of Management and
Budget; and the Secretaries of Commerce, Defense, the Army, the Navy,
and the Air Force.  Copies will also be made available to others upon
request. 

This report was prepared under the direction of Thomas J.  Schulz,
who can be reached at (202) 512-4841 if you or your staff have any
questions.  Other major contributors to this report were Allen Li,
Charles F.  Rey, Robert R.  Hadley, Richard H.  Yeh, and Keith A. 
Rhodes. 

Henry L.  Hinton, Jr.
Assistant Comptroller General

List of Congressional Committees

The Honorable Strom Thurmond
Chairman
The Honorable Carl Levin
Ranking Minority Member
Committee on Armed Services
United States Senate

The Honorable Richard Shelby
Chairman
The Honorable Bob Kerrey
Vice Chairman
Senate Select Committee on Intelligence
United States Senate

The Honorable Ted Stevens
Chairman
The Honorable Daniel K.  Inouye
Ranking Minority Member
Subcommittee on Defense
Committee on Appropriations
United States Senate

The Honorable John McCain
Chairman
The Honorable Ernest Hollings
Ranking Minority Member
Committee on Commerce, Science, and Transportation
United States Senate

The Honorable Fred Thompson
Chairman
The Honorable John Glenn
Ranking Minority Member
Committee on Governmental Affairs
United States Senate

The Honorable Floyd Spence
Chairman
The Honorable Ronald V.  Dellums
Ranking Minority Member
Committee on National Security
House of Representatives

The Honorable Porter J.  Goss
Chairman
The Honorable Norm Dicks
Ranking Minority Member
Permanent Select Committee on Intelligence
House of Representatives

The Honorable Robert L.  Livingston
Chairman
The Honorable David R.  Obey
Ranking Minority Member
Committee on Appropriations
House of Representatives

The Honorable Thomas Bliley
Chairman
The Honorable John Dingell
Ranking Minority Member
Committee on Commerce
House of Representatives

The Honorable Dan Burton
Chairman
The Honorable Henry A.  Waxman
Ranking Minority Member
House Committee on Government Reform and Oversight
House of Representatives




(See figure in printed edition.)Appendix I
COMMENTS FROM THE NATIONAL
SECURITY COUNCIL
============================================================== Letter 




(See figure in printed edition.)Appendix II
COMMENTS FROM THE DEPARTMENT OF
COMMERCE
============================================================== Letter 



(See figure in printed edition.)




(See figure in printed edition.)Appendix III
COMMENTS FROM THE FEDERAL
COMMUNICATIONS COMMISSION
============================================================== Letter 



(See figure in printed edition.)



(See figure in printed edition.)


The following are GAO's comments on the Federal Communications
Commisson's (FCC) letter dated May 9, 1997. 

GAO COMMENTS

1.  Our report is not intended to single out FCC as the cause for the
problems identified in this report.  As we point out on page 1 of the
report, our objective was to determine whether each of the involved
agencies was taking the appropriate steps to prevent or minimize
adverse effects of the transfer of frequency bands to the private
sector.  We are making recommendations to others besides FCC and,
subsequent to our analysis of comments from involved agencies, have
added a matter for congressional consideration. 

2.  The information exchange problem, like others discussed in the
report, revolves around the lack of agreement among the agencies
involved.  Currently, there is a lack of agreement on what data
should be gathered and who should be responsible for gathering that
data.  We are recommending that FCC and Commerce report on their
progress in implementing the joint planned requirements of the 1993
act and on any unresolved issues and impediments. 

3.  The title of the report, in our view, accurately portrays the
issue.  The report does not discuss FCC's licensing process, as FCC
asserts. 

4.  Our review of the legislative history of the 1993 act indicates
that the act was intended to benefit the public by making spectrum
available but not at the expense of national security or excessive
costs to the government.  Our recommendations are intended to prevent
the reallocation of frequencies from the federal government to the
private sector until all national security requirements for these
frequencies are reviewed, thus avoiding excessive costs the
government may incur in its recovery of any necessary frequencies. 

5.  The legal time limit set by the 1993 Omnibus act is August 1998
and the deadline imposed by FCC for the Department of Defense (DOD)
to respond is September 1997.  We believe FCC could allow DOD time to
implement our recommendation for completion of its study after
September 1997 and still comply with its statutory deadline.  FCC
could negotiate that date with DOD.  Additionally, we are offering a
matter for the Congress to consider with regard to relaxing the
existing deadline. 

6.  We are concerned that the lack of coordination between FCC and
the National Telecommunications and Information Administration (NTIA)
on frequency sharing may exacerbate the problem of potential
interference between federal and nonfederal users of the frequency
spectrum or, at a minimum, not serve to help overcome that problem. 




(See figure in printed edition.)Appendix IV
COMMENTS FROM THE DEPARTMENT OF
DEFENSE
============================================================== Letter 



(See figure in printed edition.)



(See figure in printed edition.)



(See figure in printed edition.)



(See figure in printed edition.)



(See figure in printed edition.)


The following are GAO's comments on DOD's letter dated May 19, 1997. 

GAO COMMENTS

1.  The 1996 DOD-commissioned study by the Institute for Defense
Analysis corroborates our finding that DOD spectrum management was
fragmented and inadequate.  The study concluded that no single
high-level DOD point of contact for spectrum management existed and
that most influence resided within the services.  According to the
study, neither the Office of the Secretary of Defense nor the Joint
Chiefs of Staff has official representatives to the Interdepartment
Radio Advisory Committee, the advisory body for spectrum planning and
policy.  Instead, each service has its own representative to that
committee.  The study also stated that the services primarily
represent DOD in international frequency management matters. 

Further, the DOD-commissioned study stated weaknesses existed in
carrying out some spectrum management functions, specifically,
long-range planning.  Our review also found these weaknesses.  In
addition, the study concluded that DOD needed to pay more attention
to long-range planning and to provide more intercommunication,
coordination, and cooperation among spectrum management organizations
within DOD and between DOD and non-DOD organizations.  Our work also
convinced us that these long-range planning observations were valid. 

2.  We believe the study should include information on the impact of
the 1993 act on the systems affected.  Comments from the National
Security Council and FCC fully suggest its inclusion.  Moreover,
Commerce had no objection to it. 

As we noted in our report, the 1993 act requires that the spectrum to
be reallocated must not be "required for the present or identifiable
future needs of the Federal Government and should not result in costs
to the federal government that exceed the benefits gained." The
current DOD study is being done now because it was not done for the
1993 act. 

Information provided by the Joint Chiefs of Staff and officials from
the Office of the Assistant Secretary of Defense for Command,
Control, Communications, Computers, and Intelligence indicates that
the Military Communications Electronics Board directed the Joint
Spectrum Center in its current study to identify frequencies that DOD
(1) must absolutely defend against reallocation, (2) can share with
the private sector, and (3) can forfeit. 

Additionally, Center officials told us that their initial assessment
identified 15 frequency bands where DOD has exclusive use or is
allocated priority use of the frequencies and that there are over
2,000 DOD systems operating in these bands now or planned by the year
2005.  The officials said 154 of these systems, including CEC, were
designated as key or representative systems and a more detailed
technical analysis was required of each key system in the 15 bands to
identify potential areas where government and private industry
sharing can occur. 


*** End of document. ***




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