New Hampshire committee conducts final meeting, preparing final report on FirstNet ‘opt-out’ risks for governor

Officials for FirstNet and AT&T repeatedly have stated that “opt-in” states would not have pay any money for having the RAN deployed and maintained for 25 years, although public-safety agencies using the network would have to pay subscription fees and buy end-user devices to access the system.

States pursuing the “opt-out” alternative must have their deployment plans approved by the FCC and the National Telecommunications and Information Administration (NTIA)—and reach a spectrum-lease agreement with FirstNet—before being declared an “opt-out” state. Although each “opt-out” state would be eligible for an NTIA grant that would pay some of the construction costs for the alternative RAN, the state and its vendor would be responsible for funding the maintenance and upgrade of the RAN.

With this in mind, the primary “opt-out” challenge cited by many state representatives is ensuring that “opt-out” states are not exposed to risks created by a state’s alternative-RAN vendor failing to meet the technical, operational or financial requirements associated with FirstNet. In particular, many state officials have noted that it could be difficult for an alternative-RAN vendor to secure a performance bond that would cover the 25-year term of a FirstNet deal, especially when the costs associated with network upgrades to 5G and 6G technologies are unknown.

If an “opt-out” state’s alternative RAN vendor were to declare bankruptcy or fail to execute in accordance to FirstNet guidelines, the state could be exposed to paying a “termination fee” to FirstNet in return for operating a network within the state. Many state officials have criticized the termination fee proposed by FirstNet—reportedly as much as $15 billion in California, according to state presentations—although FirstNet officials recently have acknowledged that the estimates likely represent worst-case scenarios.

Other factors that officials in “opt-out” states should consider are the costs associated with interoperability testing, security upgrades, project management, and payments to FirstNet to access needed spectrum and core services.

Early in October, New Hampshire’s state interoperability executive committee [SIEC] unanimously voted—with 15 affirmative votes and 2 abstentions—to recommend that Sununu decide to pursue the “opt-out” alternative. On Oct. 16, Sununu issued an executive order acknowledging the SIEC recommendation on technical grounds and creating a new Opt-Out Review Committee to assess the regulatory and financial risks the state would face under an “opt-out” scenario.

According to a spokesman in Sununu’s office, the five members of the Opt-Out Review Committee are:

• Charlie Arlinghaus, commissioner of the state’s Department of Administrative Services;
• Jared Chicoine, director of the state’s Office of Strategic Initiatives;
• State Treasurer Bill Dwyer;
• Attorney General Gordon MacDonald; and
• James Key-Wallace, executive director of the state’s Business Finance Authority.