Congressional Budget Office

CBO Scores Securing Access to Networks in Disasters Act

The Securing Access to Networks in Disasters Act of 2016 (S 2997) would direct the Federal Communications Commission to study ways to enhance access to telecommunications services during emergencies when mobile service is unavailable. The bill also would redefine the term “essential service provider” to explicitly include certain telecommunication mediums, such as Internet and cable services, in a list of entities that provide essential services. (Providers of essential services are generally provided access to disaster sites in order to restore and repair services during emergency situations.) Finally, S. 2997 would direct the General Accountability Office (GAO) to study ways the federal government could increase the resiliency of essential communication services during emergencies.

On the basis of information provided by the FCC, CBO estimates that carrying out the analysis required by the bill would increase the agency’s administrative costs by less than $500,000; such spending would be subject to the availability of appropriated funds. Under current law, the FCC is authorized to collect fees sufficient to offset the cost of its regulatory activities each year. Therefore, CBO estimates that the net cost to implement those provisions would be negligible, assuming appropriation actions consistent with the agency’s authorities. Based on the costs of similar reports conducted by GAO, CBO estimates that the increased costs to GAO to conduct the required study would be insignificant. Enacting S. 2997 would not affect direct spending or revenues; therefore, pay-as-you-go procedures do not apply. CBO estimates that enacting S. 2997 would not increase net direct spending or on-budget deficits in any of the four consecutive 10-year periods beginning in 2027.

CBO Scores FCC Reauthorization Act

The FCC Reauthorization Act of 2016 (S 2644) would authorize appropriations totaling $728 million for the operations of the Federal Communication Commission (FCC) for 2017 and 2018. Assuming appropriation of those amounts, CBO estimates that implementing S. 2644 would have a gross cost of $705 million over the 2017-2021 period.

CBO estimates that all appropriations to the FCC would be offset by fees authorized to be collected under current law. Assuming that future appropriation acts allow the FCC to continue to collect such fees, CBO estimates that net discretionary spending under S. 2644 would be reduced by $23 million over the 2017-2021 period. Enacting S. 2644 would affect direct spending; therefore, pay-as-you-go procedures apply. However, CBO estimates that the net effects would be negligible over the 2017-2026 period. Enacting the bill would not affect revenues. CBO estimates that enacting the legislation would not increase net direct spending or on-budget deficits in any of the four consecutive 10-year periods beginning in 2027. S. 2644 contains an intergovernmental mandate as defined in the Unfunded Mandates Reform Act (UMRA), but CBO estimates that the mandate would impose no costs on state, local, or tribal governments. S. 2644 would impose private-sector mandates, as defined in UMRA. Based on information from industry sources and information about existing state laws, CBO estimates that the aggregate costs of the mandates would fall below the annual threshold established in UMRA for private-sector mandates ($154 million in 2016, adjusted annually for inflation).

CBO Scores Bill that would Update Spectrum Auction Procedures

Senate Bill 2319 would amend current law to require that certain payments related to auctions held by the Federal Communications Commission the be deposited in the Treasury. Under current law, the proceeds from the FCC’s auctions of licenses to use the electromagnetic spectrum are deposited in different types of financial institutions depending on the phase of the auction process. Most of the offsetting receipts from those auctions are already deposited directly in the Treasury. However, the amounts paid before the start of an auction, which are known as upfront payments, must initially be deposited in an interest-bearing account at a designated financial institution.

The FCC currently requires upfront payments to be deposited in the agency’s account at the Federal Reserve Bank of New York. After the auction closes, the upfront payments for winning bids are transmitted to the Treasury and the remainder is refunded to the unsuccessful bidders. Fees charged by banks for those transactions are deducted from auction receipts. Pay-as-you-go procedures apply because enacting S. 2319 would reduce direct spending. Eliminating transaction fees, which are paid by the federal government from auction receipts, would increase net offsetting receipts. (Offsetting receipts are considered to be reductions in direct spending.) However, based on financial information from the FCC, CBO estimates that the transaction fees charged by the Federal Reserve Bank are negligible; therefore, any increase in auction proceeds stemming from enacting the bill also would be negligible. Enacting the bill would not affect revenues. CBO estimates that enacting S. 2319 would not increase net direct spending or on-budget deficits in any of the four consecutive 10-year periods beginning in 2027. S. 2319 contains no intergovernmental or private-sector mandates as defined in the Unfunded Mandates Reform Act and would not affect the budgets of state, local, or tribal governments.

CBO Scores Internet of Things Bill

S. 2607 would direct the Department of Commerce (DOC) to convene a working group of various federal agency representatives and a steering committee of private stakeholders to produce reports and recommendations to the Congress to improve intragovernmental coordination and to encourage the development of the Internet of things. (The Internet of things refers to the growing number of devices that connect to the Internet and interact with one another.) It also would direct the Federal Communications Commission to prepare a report assessing the need for spectrum to support such development.

On the basis of information from DOC and the Federal Trade Commission, CBO estimates that implementing S. 2607 would require about a dozen employees and would cost $3 million to convene the working group and to develop the reports required under the bill. Those costs would be spread among the federal agencies that would be a part of the working group and such spending would be subject to the availability of appropriated funds. Enacting S. 2607 would not affect direct spending or revenues; therefore, pay-as-you-go procedures do not apply. CBO estimates that enacting S. 2607 would not increase net direct spending or on-budget deficits in any of the four consecutive 10-year periods beginning in 2027. S. 2607 contains no intergovernmental or private-sector mandates as defined in the Unfunded Mandates Reform Act and would not affect the budgets of state, local, or tribal governments.

CBO Scores Permanent Internet Tax Freedom Act

H.R. 3086 would make permanent a moratorium on state and local taxes on Internet access and some taxes on electronic commerce. Under current law, the moratorium is set to expire on November 1, 2014.

Congressional Budget Office estimates that enacting H.R. 3086 would have no impact on the federal budget, but beginning in 2014, it would impose significant annual costs on some state and local governments. The bill would not affect federal direct spending or revenues; therefore, pay-as-you-go procedures do not apply.

By permanently prohibiting state and local government from collecting certain types of taxes, H.R. 3086 would impose an intergovernmental mandate as defined in the Unfunded Mandates Reform Act (UMRA).

CBO estimates that the mandate would cause some state and local governments to lose revenue beginning in November 2014; those losses would exceed the threshold established in UMRA for intergovernmental mandates ($76 million in 2014, adjusted annually for inflation) beginning in 2015.

CBO estimates that the direct costs to states and local governments would probably total more than several hundred million dollars annually.

H.R. 3361, USA FREEDOM Act

H.R. 3361 would make several amendments to investigative and surveillance authorities of the United States government, and would specify the conditions under which the federal government may conduct certain types of surveillance.

The Congressional Budget Office does not provide estimates for classified programs; therefore, this estimate addresses only the unclassified aspects of the bill. On that limited basis, CBO estimates implementing H.R. 3361 would cost approximately $15 million over the 2015-2019 period, subject to the appropriation of the necessary amounts.

CBO Scores National Cybersecurity and Critical Infrastructure Protection Act

The National Cybersecurity and Critical Infrastructure Protection Act (H.R. 3696) would amend the Homeland Security Act of 2002 to require the Secretary of the Department of Homeland Security (DHS) to conduct cybersecurity activities on behalf of the federal government and would codify the role of DHS in preventing and responding to cybersecurity incidents involving the Information Technology (IT) systems of federal civilian agencies and critical infrastructure in the United States.

Although DHS currently conducts many of the activities covered by H.R. 3696 and has received approximately $800 million so far in fiscal year 2014 for its cybersecurity activities, some provisions in the bill would expand existing programs, provide additional authorities, or add new requirements beyond the agency’s current efforts.

Assuming the appropriation of the necessary amounts, CBO estimates that implementing the bill would cost an additional $160 million over the 2015-2019 period. Pay-as-you-go procedures do not apply to this legislation because it would not affect direct spending or revenues. H.R. 3696 contains no intergovernmental or private-sector mandates as defined in the Unfunded Mandates Reform Act (UMRA).

HR 3635, Safe and Secure Federal Websites Act of 2014

Congressional Budget Office estimates that enacting the Safe and Secure Federal Websites Act of 2014 (HR 3635) would have no significant effect on the federal budget.

The legislation would amend federal laws that protect the privacy of personally identifiable information collected by the government. Personally identifiable information includes any information that identifies an individual such as name, Social Security number, and medical or financial records. The legislation would prohibit an agency from deploying a new website until the agency’s Chief Information Officer certifies that all such information is safe and secure.

Existing federal websites would have 90 days following enactment of HR 3635 to comply with this requirement. The legislation also would require the Office of Management and Budget (OMB) to issue policies and procedures for agencies to follow in the event of a security breach of a federal data system that contains personally identifiable information.

OMB’s “Breach Notification Policy” requires all agencies to implement a policy to safeguard personally identifiable information and to provide notification of a security breach. Because laws and policies regarding the security of personally identifiable information are already in place, CBO estimates that the cost of certifying the safety of information collected by federal websites would be less than $500,000 over the next five years.

Enacting the bill could affect direct spending by agencies not funded through annual appropriations; therefore, pay-as-you-go procedures apply. CBO estimates, however, that any net change in spending by those agencies would be negligible. Enacting the bill would not affect revenues.

HR 3635 contains no intergovernmental or private-sector mandates as defined in the Unfunded Mandates Reform Act and would impose no costs on state, local, or tribal governments.

HR 3676, Prohibiting In-Flight Voice Communications on Mobile Wireless Devices Act of 2013

As ordered reported by the House Committee on Transportation and Infrastructure on February 11, 2014, HR 3676 would direct the Secretary of Transportation to issue regulations that prohibit air passengers from talking on cellular phones during domestic flights. The prohibition would not apply to members of the flight crew, flight attendants, or federal law enforcement agents who are on duty.

Based on information from the Department of Transportation, The Congressional Budget Office expects that promulgating the proposed regulations would cost less than $500,000, assuming the availability of appropriated funds. HR 3676 would impose a private-sector mandate by prohibiting airline passengers from talking on cellular phones during a domestic flight.

The Federal Communications Commission recently issued a proposed rule that would allow airlines to permit passengers to use cellular phones during a flight. If the FCC adopts the rule, the bill would impose a mandate by prohibiting passengers from engaging in all voice calls during a flight; if the FCC does not adopt the rule, only the prohibition on voice calls over an in-flight Internet service would constitute a mandate. The Department of Transportation (DOT) has issued a notice that it is also considering a ban on all in-flight voice calls by passengers as an unfair practice to consumers.

[March 7]