From The RadioReference Wiki

"Narrowbanding" and "refarming" are terms heard quite often but just as often misunderstood. Both refer to the FCC plan initiated in 1992 to increase the available spectrum in the VHF and UHF land mobile bands.

After 15 years, numerous Petitions for Reconsideration and other challenges, the final FCC plan was decreed by the Commission early in 2007, with the setting of firm dates for the transition. The proceeding enacts a maximum 12.5 kHz bandwidth across the land mobile bands between 150-512 MHz, and increases available channels by creating new ones between existing channels.

The official timetable is:

01/01/2011 - All new applications must have a maximum bandwidth of 12.5 kHz; no further modifications to existing wideband licenses after that date which will increase their broadcast footprint; all manufacturing of 25 kHz equipment to cease.

01/01/2013 - All current licensees must be fully operational on 12.5 kHz equipment.

While 12.5 kHz channel spacing is widely mentioned in communications media, there is usually no corresponding mention of the difference in channel spacing between VHF and UHF, which leads to the erroneous assumption that 12.5 kHz will be the standard channel spacing across the board. In truth, 12.5 kHz channel spacing (and eventually 6.25 kHz) only affects UHF between 420 and 512 MHz.

VHF land mobile narrowband uses 7.5 kHz spacing. Existing VHF channels will remain, with new ones - already in use in some areas for the past few years, mostly in the public safety portion of the band - created between existing channels; for example, 160.230 and 160.245 remain, with 160.2375 created between them.

In the UHF band, existing channels will remain as will existing low-power offset channels; the low-power offset channels will for the most part become normal channels like any other although some will become designated low-power channels. Between these frequencies will be created new channels with 6.25 kHz spacing.

Examples of how frequencies will appear in the refarmed bands are:

* VHF (150 - 174 MHz) *
154.4000 - Existing frequency
154.4075 - New frequency
154.4150 - Existing frequency
154.4225 - New frequency
154.4300 - Existing frequency
154.4375 - New frequency
154.4450 - Existing frequency

* UHF (420 - 512 MHz) *
453.30000 - Existing frequency
453.30625 - New 6.25 kHz frequency
453.31250 - Existing low-power offset frequency
453.31875 - New 6.25 kHz frequency
453.32500 - Existing frequency

While 12.5/6.25 kHz was originally considered "across the board", 7.5 kHz spacing was eventually chosen for VHF to minimize the impact on existing licensees; with the exception of eventually having to use narrowband-capable equipment after a certain date, existing licensees will not have to change frequencies. To keep it simple many users are simply retuning existing transmitters to a lower deviation setting so as not to go beyond the new channel limits until such time as they acquire new equipment.