213 F.3d 720 (D.C. Cir. 2000)
Omnipoint Corporation, Petitionerv.Federal Communications Commission and United States of America, Respondents
No. 99-1316
United States Court of AppealsFOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued April 13, 2000Decided June 6, 2000

On Petition for Review of an Order of the Federal Communications Commission
Mark J. O'Conner argued the cause for the petitioner. Mark J. Tauber and Donna N. Lampert were on brief.
Stanley R. Scheiner, Counsel, Federal Communications  Commission, argued the cause for the respondents.  Christopher J. Wright, General Counsel, Daniel M. Armstrong,  Associate General Counsel, James M. Carr, Counsel, Federal  Communications Commission, and Joel I. Klein, Assistant Attorney General, and Andrea Limmer, and Catherine G.  O'Sullivan, Attorneys, United States Department of Justice,  were on brief.  John E. Ingle, Deputy Associate General  Counsel, Federal Communications Commission, entered an  appearance.
Before:  Edwards, Chief Judge, Henderson and Rogers,  Circuit Judges.
Opinion for the court filed by Circuit Judge Henderson.
Karen LeCraft Henderson, Circuit Judge:


1
On September  17, 1996 the Federal Communications Commission (FCC or  Commission) granted Omnipoint Corporation (Omnipoint)  eighteen broadband personal communications services (PCS)  licenses for C Block spectrum which it won at auction. Because Omnipoint was a qualifying "small business" the  FCC financed ninety per cent of Omnipoint's auction bid at a  7% interest rate "based on the rate for ten-year U.S. Treasury obligations applicable on the date the license is granted."47 C.F.R. S 24.711(b)(3).  Omnipoint requested a waiver of  the 7% interest rate calculated under section 24.711(b)(3),  arguing that it contravened the FCC's policy of setting interest rates "no higher than the government's cost of money,"  which was then 6.5%.  In re Implementation of Section 309(j)  of the Communications Act--Competitive Bidding, Second  Report and Order, 9 F.C.C.R. 2348, 2390 (1994).  The FCC's  Bureau of Wireless Communications (Bureau) first denied  Omnipoint's waiver request, a decision the Commission ultimately affirmed, finding that strict adherence to section  24.711(b)(3) did not frustrate its underlying policy or unduly  burden Omnipoint contrary to the public interest.  We deny  Omnipoint's petition for review of the FCC's waiver denial.

I.

2
In 1993 the United States Congress authorized the FCC to  allocate spectrum by auction and directed it to promulgate  rules "to ensure that small businesses ... are given the  opportunity to participate in the provision of spectrum-based  services."  47 U.S.C. S 309(j)(4)(D).  In setting up the small business preference, the FCC identified "two broad, basic ...  policy goals:  promoting economic growth and enhancing access to telecommunications service offerings for consumers,  producers, and new entrants."  Second Report and Order, 9  F.C.C.R. at 2349.  The FCC intended its rules to foster  economic growth by ensuring "that small businesses ... are  given the opportunity to participate in both the competitive  bidding process and the provision of spectrum-based services."  Id. at 2388.  It promulgated section 24.711(b)(3),  establishing the interest rate for small business auction winners "based on the rate of the U.S. Treasury obligations (with  maturities closest to the duration of the license term) at the  time of licensing."  Id.at 2410 (codified at 47 C.F.R. S 24.711(b)(3)).  In promulgating section 24.711(b)(3) the  FCC stated:


3
Finally, we also agree with those commenters that suggest that interest on installments should be charged at a rate no higher than the government's cost of money.  We recognize that, in addition to providing a source of financing that might not otherwise be available to small entities, we should impose interest in a manner that is designed to provide significant financial assistance to small businesses.  Accordingly, in order to ensure that this government financing results in significant capital cost savings to small businesses, we will impose interest on installment payments equal to the rate for U.S. Treasury obligations of maturity equal to the license term.  This rate is generally lower than the prime lending rate established by private banks.


4
Id. at 2390-91.1  The FCC consistently applied the Treasury  note rate in assigning installment payment interest rates.  See In re Implementation of Section 309(j) of the Communications Act--Competitive Bidding, Fifth Report and Order, 9  F.C.C.R. 5532, 5592-93 (1994) ("Interest will accrue at the  Treasury note rate.");  In re Implementation of Section 309(j)  of the Communications Act--Competitive Bidding, Sixth Report and Order, 11 F.C.C.R. 136, 156-59 (1995), aff'd, Omnipoint Corp. v. FCC, 78 F.3d 620 (D.C. Cir. 1996) (Interest will  be charged "at a rate equal to ten-year U.S. Treasury obligations applicable on the date the license is granted.").


5
On September 17, 1996, after auction, the FCC granted  Omnipoint eighteen broadband PCS licenses for C Block  spectrum.  As a qualifying small business Omnipoint was  eligible for government-sponsored financing of ninety per  cent of its winning bid obligation and a favorable interest rate  on its debt.  See Second Report and Order, 9 F.C.C.R. at  2389-90;  47 C.F.R. S 24.711(b).  At the time the "rate for  ten-year U.S. Treasury obligations" was 7%, set by the  August 1996 United States Treasury auction.  As both sides  agree, however, the August 1996 Treasury auction was "unusual."  In re Requests for Waiver of Section 24.711(b)(3) of  the Comm'n's Rules Establishing the Interest Rate on Installment Payments for C Block PCS Licensees, Memorandum Opinion and Order, 14 F.C.C.R. 9298, 9302 (1999).


6
Treasury auctions for ten-year notes are typically held in  February, May, August and November of each year using a  competitive bidding methodology.2  In 1996, however, for the first time since 1980, the Treasury Department auctioned ten year notes in July and then reopened the July auction in  August.  As a result, the August notes bore the coupon rate  of 7% from the July auction even though the rate in fact  reflected neither the August auction results, nor August market conditions northe government's actual cost of money--a yield of 6.535%.  Instead, the bidders in the August  auction paid a premium for the ten-year notes.  According to  Omnipoint, had the Treasury Department instead issued a  new security in August, "the average auction yield of 6.535%  would have dictated a coupon rate of 6.5% on the new  security."  John Friel Decl. 2 (Dec. 11, 1996).  On December  16, 1996 Omnipoint filed a request for waiver of section  24.711(b)(3), claiming that, because of the August auction's  "unusual circumstances," the FCC's use of the 7% coupon  rate contravened both its policy of setting interest rates at no  more than the government's cost of money and the public  interest.  Omnipoint requested that the FCC instead apply a  6.5% interest rate based on the August auction's weighted  yield.  The Bureau denied Omnipoint's waiver request and  the FCC, on June 2, 1999, affirmed the Bureau's denial. Omnipoint then timely petitioned for review.

II.

7
The FCC interpreted "rate" as used in section 24.711(b)(3)  as the coupon rate and therefore applied the August auction's  7% coupon rate for ten-year notes to Omnipoint's installment  payments.3  See Memorandum Opinion and Order, 14  F.C.C.R. at 9303.  Omnipoint contends that the FCC arbitrarily and capriciously denied its waiver request, ignoring  the required "hard look" standard.  BellSouth Corp. v. FCC,  162 F.3d 1215, 1224-25 (D.C. Cir. 1999) (Waiver requests "are  not subject to perfunctory treatment, but must be given a  hard look.") (quotation omitted).  According to the FCC  waiver rule:


8
The Commission may grant a request for waiver if it is shown that:


9
(i) The underlying purpose of the rule(s) would not be served or would be frustrated by application to the instant case and that a grant of the requested waiver would be in the public interest;  or


10
(ii) In view of the unique or unusual factual circum-stances of the instant case, application of the rule(s)would be inequitable, unduly burdensome or contrary to the public interest, or the applicant has no reasonable alternative.


11
47 C.F.R. S 1.925(b)(3).  Omnipoint assumes a "heavy" burden because "an agency's refusal to grant a waiver will not be  overturned unless the agency's reasons are so insubstantial as  to render that denial an abuse of discretion."  Mountain  Solutions, Ltd., Inc. v. FCC, 197 F.3d 512, 517 (D.C. Cir.  1999) (quotations omitted).  Furthermore, "the agency's strict  construction of a general rule in the face of waiver requests is  insufficient evidence of an abuse of discretion."  Id. (citing  BellSouth, 162 F.3d at 1225).


12
Omnipoint argues that section 24.711(b)(3)'s underlying  purpose is to provide financing to C Block licensees at a rate  "no higher than the government's cost of money."  The  record, however, does not support Omnipoint's "restricted  view of the Commission's goals and purposes."  BellSouth,  162 F.3d at 1224.  The FCC initially articulated its purpose  as "promoting economic growth and enhancing access to  telecommunications service offerings for consumers, producers, and new entrants."  Second Report and Order, 9  F.C.C.R. at 2348.  To that end the FCC allowed a small  business licensee to pay for its licenses in installment payments over the license term.  See 47 C.F.R. S 24.711(b).  The FCC also "agree[d] with those commenters that suggest that  interest on installments should be charged at a rate no higher  than the government's cost of money."Second Report and  Order, 9 F.C.C.R. at 2390.  But the FCC stopped short of committing itself and ultimately retreated from the notion  that its purpose was to provide an interest rate no higher  than the government's cost of money.  Instead, the FCC  considered section 24.711(b)(3) to represent "an identifiable  benchmark" for interest rates.  Memorandum Order and  Opinion, 14 F.C.C.R. at 9303 ("The Commission has recognized that Treasury auctions provide an identifiable benchmark on which to base interest rates for installment payments, but may not always reflect the government's cost of  money.") (citing Amendment of Part 1 of the Comm'n's  Rules--Competitive Bidding Proceeding, Order, Memorandum Opinion and Order and Notice of Proposed Rulemaking,  12 F.C.C.R. 5686, 5709 (1997)).  The FCC clarified that "[t]he  policy behind our installment payment plan was to facilitate  small business participation in our auction process by, among  other things, application of the low interest rates used in the  Treasury auctions."  Id.;  see also Second Report and Order,  9 F.C.C.R. at 2390-91 (FCC intended to provide financing "in  a manner that is designed to provide significant financial  assistance" at rates "generally lower than the prime lending  rate established by private banks.").  The 7% interest rate,  while higher than the government's cost of money in August  1996, was nevertheless significantly lower than the 11.625%  interest rate private banks were then charging.  See Memorandum Opinion and Order, 14 F.C.C.R. at 9303 n.39.  We  conclude that the FCC reasonably determined that strict  adherence to section 24.711(b)(3) did not frustrate its underlying purpose to provide interest rates lower than those of  private banks.


13
Additionally, Omnipoint failed to show that its "unusual  factual circumstances" made the application of section  24.711(b)(3) to its installment payments inequitable or contrary to the public interest.  Although the August 1996 Treasury auction was unusual, Omnipoint claims that its  additional $6 million dollar cost (over ten years) resulting from the 0.5% interest rate difference harms the public  interest.  Omnipoint cannot satisfy the public interest requirement, however, merely by "equat[ing] its own business  interest with the public interest."  BellSouth, 162 F.3d at  1225.  We conclude that the FCC did not abuse its discretion  in denying Omnipoint's request for a waiver from section  24.711(b)(3) in that it reasonably determined that "the Bureau  gave [Omnipoint's] waiver request a 'hard look' " and that  Omnipoint did not show how a waiver would serve the public  interest.  Id.  Accordingly, Omnipoint's petition for review of  the FCC's waiver denial is


14
Denied.



Notes:


1
 In 1995 the FCC amended section 24.711(b)(3) to provide for an  interest rate "based on the rate for ten-year U.S. Treasury obligations applicable on the date the license is granted."  See Race  and Gender Based Provisions for Auctioning C Block Broadband  Personal Communications Services Licenses, 60 Fed. Reg. 37,786, 37,796 (1995) (codified at 47 C.F.R. S 24.711(b)(3)).  The amended version applies to Omnipoint.  After a 1998 amendment not relevant  here, section 24.711(b)(3) now provides for an interest rate based on  the ten-year Treasury note "plus 2.5 percent."  Competitive Bidding Process, 63 Fed. Reg. 2315, 2349 (1998) (codified at 47 C.F.R. S 24.711(b)(3)).


2
 The Treasury auctions ten-year notes by accepting investors'  written bids specifying the lowest asking yield and moving upward  until it raises a targeted amount of money.  Each auction establishes a yield and a coupon rate.  Treasury regulations define  "yield" as the "annualized rate of return to maturity on a note or  bond expressed as a percentage."  31 C.F.R. S 356.2.  The coupon  rate, which a ten-year note bears, is "set at a 1/8 of one percent  increment" which is "closest to, but not above, par when evaluated  at the weighted-average yield of awards to successful competitive  bidders."  Id. § 356.20(b).


3
 Omnipoint contends that the FCC arbitrarily interpreted "rate"  as the coupon rate instead of the yield.  Such an argument,  however, is beyond the scope of a waiver request.  See WAIT  Radio v. FCC, 418 F.2d 1153, 1158 (D.C. Cir. 1969) ("The very  essence of waiver is the assumed validity of the general rule, and  also the applicant's violation unless waiver is granted.").


