I seem to remember that years ago, there was an auction of 700 mhz frequencies and a company bought the frequencies. Users would have to pay to use a 700 frequency. Is this true?
Nope. There are two (perhaps three) different portions of the 700 MHz "band" commonly discussed.
The section which was allocated to public safety, from 763-806, was always allocated that way (at least since the band was eliminated as a series of TV channels on analog terrestrial TV) and hasn't changed.
There is another section which was auctioned to wireless providers and ultimately allocated for consumer LTE products. Most smartphones today use this band in addition to other frequency bands between 800 and 6000 MHz, to deliver your internet, telephone voice, SMS, etc. I don't recall the exact frequencies; this
Wikipedia article may help.
The section which has made the most noise in the news media over the past few years is a section that was as-yet unused by both consumer LTE and public safety voice/data. These sections were the subject of various debates in both American and Canadian government sessions (both countries had similar situations ongoing) as to whether the bands would be auctioned off as more consumer LTE or given to public safety for a dedicated, public safety LTE network(s). In the end, the 20 MHz that was as-yet unallocated was designated for public safety LTE on both sides of the border. This will be used eventually for broadband data transmissions such as pictures, video, and other data relating to fire, police, and medical incidents. However, of all of these bands, only the original public safety voice/data, 763-806, is scannable, and 99% of it is APCO P25 digital.
As for "pay to use", technically all of it is, because you have to have a license to use (transmit on) a radio frequency, and you have to generally pay for a license.