Alaska, Nebraska USF Revamp Efforts Receive Industry Warnings

The RCA plans to review USF comments and meet this fall, a spokeswoman said Thursday. The RCA collected feedback in docket R-17-001 on proposed USF rule changes including what to do in a shortage situation, a short-term effort to stem bleeding of the fund (see 1708220014). Meanwhile, the Nebraska PSC received a closing round of comments in docket NUSF-100, following an Aug. 30 hearing, on a proposed switch to connections-based contribution from the existing mechanism that takes a percentage of intrastate revenue.

The RCA should consider its proposal a temporary measure while the commission considers broader changes, AT&T commented. "The AUSF is fairly complex and changes to one rule often impact other sections.” AT&T understands the RCA wants to act quickly since the fund is operating at a deficit, but “it would be beneficial and actually more time efficient to discuss proposed USF changes at a workshop rather than continue to have various rounds of comments." The proposed changes “do not reflect a holistic, comprehensive solution to the issues with the AUSF” and "may ultimately do more harm than good,” a coalition of rural Alaska phone companies said: The agency “should initiate a proceeding to comprehensively reform the AUSF or allow recent AUSF modifications to take effect and then reassess the best approach.”

There’s no reason for Nebraska to switch to connections-based contribution, CTIA commented. While collections may have declined, there's no reason to infer “that future collections will decline to a level that will challenge the sustainability of the fund, or even whether future collections will continue to decline at all,” the wireless association said: Those seeking change “are asking the Commission to modify the bedrock of this important program on a speculative basis.” Connections-based contribution could harm vulnerable consumers by imposing the same fee on every consumer regardless of their usage or ability to pay, CTIA said. The revamp would require major changes to carrier billing systems, the group said. CTIA earlier warned that the PSC could risk litigation if it revamps USF contribution before an FCC overhaul (see 1608040032).

Revamping USF contribution is “required” for the PSC to “fulfill its statutory duties” administering NUSF, countered a coalition of rural Nebraska phone companies. The commission has legal authority to adopt a connections-based mechanism; a connections mechanism would provide stability, predictability and accountability to keep the fund viable; and any costs and potential administrative issues will be “manageable,” they said.

“A connections-based charge might be workable provided it is sufficiently small to avoid creating more problems than it solves,” Charter commented. The company said concern with keeping an intrastate revenue-based system “is predominately a concern with wireless revenues,” and merits of a connections-based approach depend "upon the continued growth in wireless connections.”

It’s "ill-advised" for regulator​ "to proceed independently, prior" to a federal USF overhaul, Cox commented. The state commission should hold a workshop, the company said. “If the Commission moves towards a connections-based methodology, clear definitions, a thorough understanding of implementation issues, and the actual impact felt by end-user customers must be discerned.” Cox disagreed with the rural companies that carrier billing costs will be minimal: there's no way to know “when critical details remain unresolved.”

The Utah PSC plans to shift Jan. 1 to connections-based USF contribution. Comments are due Oct. 4 on how to handle assessment of prepaid wireless services (see 1709060036). Several states have seen declines in state USF revenue; other commissions mulling USF changes include Idaho, Kentucky, Missouri, Nevada, Oklahoma and Texas.