Administration Looks to the FCC as High-Tech Cash Cow : Funding: New and higher fees are proposed to help pay for programs ranging from health care to immigration law enforcement.

The Federal Communications Commission is being targeted as a high-tech piggy bank in the Clinton Administration’s increasingly pointed search for more money to fund health care, immigration law enforcement and other programs.

The Administration last week proposed that Congress raise $72.4 million in FCC user fees for things such as radio and TV broadcast licenses starting Oct. 1, in order to help states pay for the cost of jailing illegal immigrants convicted of felonies.

In addition, industry and Capitol Hill sources say the Administration plans to propose a spectrum royalty fee on new communications services to raise up to $4.8 billion over five years to help cover the estimated $13-billion cost of implementing the General Agreement on Tariffs and Trade accord.

Meanwhile, the sources say privately that they believe the Administration is trying to encourage FCC Chairman Reed Hundt to delay and revise the forthcoming auction for wireless personal communications services, or PCS, in order to increase proceeds and make a dent in the huge cost of President Clinton’s health care proposals.

The sources, who did not want to be identified, said the plan is to divide up PCS licenses in such a way that the FCC would raise more than the $7 billion to $10 billion the Administration has previously estimated the auction will bring.

Hundt, who has been waging an uphill battle for money to hire more FCC staff to police the cable industry and oversee forthcoming PCS auctions, told a Senate panel Thursday that auctions for the most valuable part of PCS service may be pushed back to the winter from this fall, an FCC spokeswoman said. But she said the FCC chairman is under no Administration pressure to come up with a new auction scheme.

“Part of the delay is driven by the concern that we aren’t far enough along in selecting a firm to conduct the auction,” said Susan Sallet. She said the agency wants to proceed more slowly to ensure that there are no glitches in the auction process. “It is not our goal to delay the process in order to raise more money,” she said.

Wireless communications services such as PCS represent one of the fastest-growing segments of the telecommunications industry. The Clinton Administration has said it wants to move quickly to reduce regulatory barriers to development of the industry, yet maximize fairness and revenue by auctioning off licenses for many new communications services rather than allocating them by lottery or administrative hearing.

Many companies, including some that have blasted the FCC’s auction plans, are alarmed by the specter of further delays and increased bidding costs. Increasing fees and postponing auctions for PCS and other wireless services, they argue, will give an insurmountable competitive advantage to cellular companies and entrenched providers.

“The Administration runs the risk of killing the goose that has the potential to lay the golden egg,” said Thomas A. Stroup, president of the Personal Communications Industry Assn., a trade group. “For them to delay the process and add additional fees could very well tip the scale to the point that it drives potential entrants away.”

But after seeing MCI Communications Corp. recently agree to invest $1.3 billion in the nation’s largest mobile radio company--nearly 14 times the amount the Administration believes an equal slice of airwaves would raise in the planned PCS auctions--sources say the Administration wants to up the ante.

However, the strategy has enraged a number of industry officials and lawmakers, including Rep. John D. Dingell (D-Mich), chairman of the powerful House Commerce Committee. On Thursday he sent a letter to White House Budget Director Leon Panetta angrily decrying “this unfortunate practice of raiding programs within our jurisdiction to fund unrelated Administration initiatives.”

Dingell said that under current law, FCC user fees are already forecast by the Administration to cover all of the agency’s costs except for funds to pay for the five FCC commissioners, their staffs and the general counsel’s office. “Is the Administration proposing to levy a new fee on top of the processing fees” already in place, thus “forcing applicants to pay twice for the same service?” Dingell asked.

With respect to GATT, Dingell told Panetta, “I encourage you in the strongest possible terms to seek funding sources that are more closely linked to the GATT agreement than . . . a spectrum user fee.”

James H. Quello, a Democrat and an FCC commissioner, added: “Charging a fee is OK, but using it for the detention of (illegal) aliens strikes me as hard to accept. The money should be used to defray the expenses of the FCC or for other communications purposes.”

Technically, the FCC fee increase would indeed go toward the FCC’s $167-million annual budget. But it would free up money the government now spends on the FCC for use in the illegal immigrant law enforcement program, the White House says. The Administration has not released details on how it would apply the proposed spectrum royalty fee, but that plan has drawn critics as well.