FCC Partially Approves 800 MHz Rebanding Settlement Between Stamford, Sprint

Friday, November 13, 2015 | Comments

“We approve the settlement only in part because to do otherwise would be contrary to the provisions of the 800 MHz report and order respecting Sprint’s obligation to make an ‘anti-windfall’ payment to the U.S. Treasury,” a letter from the FCC said.

Under the 2007 FRA, Sprint was to pay Stamford nearly $4.9 million — the estimated cost that Stamford would have incurred had it retuned, rather than replaced, its system. Of that sum, $3.7 million was the cost of new radio equipment.

Under the FRA, Stamford was required to send to Sprint the used infrastructure equipment and subscriber radios being replaced as part of Stamford’s system upgrade to ensure that another 800 MHz licensee did not acquire the used equipment and submit it to Sprint for new replacement equipment.

If Stamford failed to send the used equipment to Sprint, Stamford it had to pay Sprint the retail price of a corresponding item of new equipment. Stamford failed to send its used equipment to Sprint. Instead, Stamford contended that its rebanding contractor consigned the used infrastructure equipment to trash receptacles and donated the used subscriber radios to the city of Hartford, Connecticut, another 800 MHz licensee.

Consequently, because the used equipment was not provided to Sprint, Sprint asserted that Stamford owed Sprint $3.26 million. In June 2014, Stamford acknowledged that it had not provided Sprint with the used equipment and proposed to settle Sprint’s claim for $956,259.64, asserted to be the total sum that Stamford could afford to pay immediately.

Subsequently, in July 2014, Sprint and Stamford sent the Transition Administrator (TA) a joint letter in which the parties proposed a modified settlement. The modified settlement provided that Stamford would pay Sprint $956,259.64 in full settlement of all claims that Sprint had against Stamford, leaving an unfunded balance of $1.9 million. However, in lieu of Stanford paying the unfunded balance, the parties proposed that Sprint would receive rebanding program credit based on a “1-to-1” proposal. That proposal contemplated Sprint receiving rebanding program credit for each replacement radio that Stamford purchased as part of its upgrade program. In addition the FCC had to approve crediting Sprint with $1.9 million without imposing conditions on the parties.

In August 2014, the Transition Administrator declined to accept the proposed modified settlement.

The FCC said in a letter that it would be inequitable and unduly burdensome to the public if it allowed Sprint to add, as a rebanding cost, the amount that it proposed to forgive Stamford. “Accordingly, we deny the waiver requested by the parties but approve the Sprint/Stamford settlement, conditioned, however, on Sprint not claiming program credit for the difference between the balance Stamford owes Sprint and the settlement amount offered by Stamford,” the letter said.

The full letter is here.



