Senate Moves on Wireless Spectrum, Upholds Durbin Amendment

As one Senate committee moved forward with legislation to allocate valuable wireless spectrum to first responders, a Senate majority voted to continue enforcing the controversial Durbin “Card Swipe” amendment regulating debit card transactions. 

In a public policy decision years in the making, the Senate Commerce Committee approved (21-4) legislation that would allocate 10 megahertz of wireless spectrum in the D-Block to create an interoperable public safety network.  A public safety network is now considered essential after events like September 11th and Hurricane Katrina.

The bill, S. 911, sponsored by Senator Jay Rockefeller, also attempts to expand nationwide spectrum availability by allowing “existing spectrum licensees to voluntarily relinquish their airwaves in exchange for a portion of the proceeds of the commercial auction of their spectrum.”

The U.S. has the stated goal of making more than 500 megahertz of spectrum available, and anyone with a smart phone or tablet computer knows how the existing spectrum crunch works in practice.  According to Peter Rysavy, a wireless analyst, the demand for mobile broadband will exceed the available spectrum in just two years.  As wireless broadband use continues to explode, the demand for more spectrum should allow companies to pay billions of dollars in public auctions for a much needed wireless expansion.

The Rockefeller bill now heads to the Senate floor, and based on the committee vote today, it will likely pass.  According to the Library of Congress, however, there are no related companion bills out of committee on the House side.

On the Senate floor today, Senator Dick Durbin received a legislative reprieve of sorts on his debit interchange provision.  In last year’s Dodd-Frank legislation, Senator Durbin won support for an amendment to instruct the Federal Reserve to cap “swipe fees” that retailers pay to issuers of credit cards.

The Federal Reserve issued a proposed rule which capped those fees at roughly 12 cents per transaction, a controversial move that has united banks and credit card companies.  The final rule, according to the Wall Street Journal, is expected to lift the 12-cent limit, however.

The Senate action yesterday will likely result in the successful passage of S. 911 and a clear path for Dodd-Frank implementation.  Although Senator Rockefeller’s legislation faces the prospects of dying on the House floor, it appears that “swipe fee” rules are here to stay.

Forum research assistant Kara Behrens contributed to this report.