October 24, 1997

Dissenting Statement
Commissioner Susan Ness

Re: Application for Review of Denial of Petition for Reconsideration Seeking Waiver of IVDS Final Down Payment Deadline

I respectfully dissent from the majority's decision to deny a request for waiver of a payment deadline that otherwise would permit the applicant to obtain the license for which it successfully bid. In this case the applicant is a very small business who won a single license; there were clear and unambiguous extenuating circumstances; and the applicant placed in escrow the full amount of the funds owed, and offered to make full payment for the bid price.

The applicant, Styles, successfully bid for the IVDS license to serve Panama City, Florida. Styles made its first downpayment of $28,125, but requested a waiver of the deadline for making its second downpayment when its investor unexpectedly withdrew its financing so that it could reassess its investment in light of marketplace uncertainty.

As a general proposition, I believe we should maintain the integrity of the auction process, and not alter or waive the rules after the fact. But there is precedent for doing so in cases such as this, and the facts presented are both uncontroverted and exceptional. The extraordinary problems with equipment and service uncertainty in the IVDS marketplace were well-known to the Commission. In fact, contemporaneously with Styles' modest waiver request, the Commission deferred installment payments for all IVDS licensees because of the uncertainty in the marketplace. The Commission also waived the first year build-out requirements for IVDS licensees.

Where the applicant has shown good faith and waiving the deadline would serve the public interest, the Wireless Bureau previously has granted waivers of second downpayment deadlines. Additionally, given our recent decision adopting options for PCS "C" Block licensees, and that the IVDS licensee before us asks only to be permitted to pay its full bid price for the license it won in Panama City, Florida, I believe the Commission should grant the requested waiver.

In Cenkan Towers L.L.C., the Wireless Bureau permitted an applicant who had missed the second downpayment deadline by three weeks to submit the amount owed, subject only to a five percent late fee. In granting the waiver, the Bureau distinguished second down payments from upfront and first down payments. The Bureau observed that the second down payment does not affect the timing of the Commission's review of applicants' qualifications:

Thus, while we have consistently denied requests to waive these earlier down payment deadlines, we believe that once the first down payment is made and applicants have already proven an ability to meet their financial obligations, some flexibility may be appropriate in addressing a minor delinquency with respect to the final down payment.

12 FCC Rcd. 1516 at 1519 (WTB, 1997).

In the case before us, the delay in payment was minimal, and the reasons for the delay clear, unambiguous, and beyond the applicant's control. Further, the applicant put the funds into escrow and offers to fulfill all of its original obligations. Under these circumstances it comports with the public interest and is equitable to grant the relief requested instead of denying the application, keeping the applicant's funds, and possibly imposing substantial additional penalties.