Rural telco officials are hopeful the FCC will approve a draft order offering rate-of-return RLECs more USF support if they will deploy more 25/3 Mbps broadband. The draft is on the agenda for Wednesday's commissioners' meeting. "I haven't heard any opposition," WTA Senior Vice President Derrick Owens told us Monday, declining to make a prediction but backing the draft: "The draft order showed us what we were looking for. Our folks thought it was favorable and helpful to them in deploying more broadband." ITTA "supported the draft order and we’re hopeful the commission will adopt it," said President Genny Morelli. Chairman Ajit Pai appears to have the votes for the draft order, said an industry representative, who expects the vote to be unanimous. There might be "discrete issues that one or more commissioners are vocal about," possibly in concurring, the representative said: "But I don’t see any dissents." Pai responded recently to numerous letters from lawmakers, including Senate Commerce Committee Chairman John Thune, R-S.D., seeking increased rural telco USF support. In exchanges posted Friday in docket 18-5, Pai highlighted the draft's main elements: (1) offering RoR carriers "another opportunity to opt in to model-based support," guaranteeing a "revenue stream for a decade in exchange for meeting specified buildout requirements"; (2) "ensuring support is sufficient by offering additional funding to carriers that currently receive model-based support and who agree to meet increased buildout requirements ... [and] increasing funding for carriers who do not receive model-based support"; (3) making the program more predictable by setting a new long-term budget for [RoR] carriers who choose not to opt in to model-based support and ending arbitrary funding cuts"; and (4) "increasing the target speeds for subsidized deployments from 10/1 Mbps."

Debate continues whether the FY 2019 National Defense Authorization Act means the FCC can bar use of USF money to buy equipment or services from companies that “pose a national security threat” to U.S. communications networks or the communications supply chain (see 1811190033). Replies largely followed the same lines as initial comments. Most said the NDAA clearly doesn’t apply here.

The FCC will investigate if top wireless carriers submitted incorrect coverage maps in violation of Mobility Fund Phase II rules, Chairman Ajit Pai said Friday. The commission suspended the window for responding to MF-II challenges until the probe’s conclusion. Carriers said they'll cooperate. FCC Commissioner Jessica Rosenworcel, state commissioners and rural competitive carriers welcomed investigation, saying more work is needed.

The Pennsylvania Public Utility Commission cleared an 8.2 percent increase to its state USF surcharge for 2019. Commissioners voted 5-0 Thursday for an order in docket M-00001337 to increase the surcharge to 2.12 percent of intrastate revenue, up from 1.96 percent this year. The surcharge is based on an estimated cash balance of $1.5 million on Dec. 31. The PUC maintained a 5 percent contingency cash reserve it’s had for the past 13 years.

Sen. Dan Sullivan, R-Alaska, told reporters Wednesday that talks with the FCC on USF Rural Health Care Program concerns brought him closer to resolution to lift his hold on Senate confirmation of FCC Commissioner Brendan Carr. But “we're not there yet.” Sullivan went public with his hold in September and noted progress on his RHCP concerns following a November meeting with FCC Chairman Ajit Pai (see 1811160043). The hold delayed confirmation of Democratic FCC nominee Geoffrey Starks via pairing (see 1809130059). Telecom lobbyists noted signs in recent days of potential progress toward an end to Sullivan's hold and improved prospects the Senate will approve the nominees in an end-of-year confirmations package.

An FCC declaratory order to clarify wireless messaging as a Title I information service, rather than a more regulated telecom service, appears headed to a 3-1 vote Wednesday, with a dissent expected by Commissioner Jessica Rosenworcel, industry officials said. Twilio sought Communications Act Title II classification for texting in 2015, after the FCC classified broadband as a Title II service (see 1510130040).

Commissioners plan to vote Dec. 13 on extending to June 29 the statutory deadline for its proceeding on whether text messaging is a telecom service subject to state USF and other surcharges (see 1805250033), said a California Public Utilities Commission proposed decision posted Tuesday in rulemaking 17-06-023. At the meeting, CPUC members plan to vote on a draft decision in that docket to affirm text messaging is subject to the surcharges and open a second phase of the proceeding. The statutory deadline was Dec. 29, but CPUC wants to give “sufficient time to consider comments on the PD and issue a final decision,” it said. The Nov. 9 draft “finds it has authority to collect Public Purpose Program surcharges under the Commission’s All End User Surcharge Mechanism and Point of Sale Mechanism,” and “intrastate text messaging services revenue is subject to user fees.” Phase two is meant “to increase the consistency, transparency, and competitive neutrality of the Commission’s surcharge mechanisms, as well as to consider methods to update the list of surchargeable services in a timely manner,” it said. The meeting is one day after the FCC plans to vote on classifying wireless messaging as an information service (see 1811200048).

FCC Commissioner Mike O'Rielly wants to act on liability under the Telephone Consumer Protection Act, possibly in a reassigned phone number draft order targeted for the Dec. 12 commissioners' meeting. He backed a draft order to classify SMS and other wireless messaging as Communications Act Title I information services, generally supported a draft order to increase rural telco USF funding and suggested he might soon push for changes to the agency’s administrative law judge process. He spoke to reporters after a Phoenix Center event Tuesday at which he discussed his municipal broadband speech concerns, kidvid efforts and broader process proposals. Also there, supporters of the FCC Title I reversal of Title II net neutrality regulation voiced confidence it will be upheld in court.

The Q1 USF contribution factor will edge down to 20.0 percent from Q4's 20.1 percent of carriers' U.S. interstate and international telecom end-user revenue, emailed industry consultant Billy Jack Gregg Sunday. Universal Service Administrative Co. projected USF-applicable telecom revenue for Q1 to be $12.29 billion, $117.5 million lower than in Q4, continuing a long-term downward trend, he said, though Q1 USF demand was also down, producing the slight decline in the factor (see 1811050026). USF revenue for the four quarters ending in Q1 will be $2.17 billion lower than for the four quarters ending in Q1 2018, a 4.1% decline, he added.

ATN International told FCC leadership the best way to help the U.S. Virgin Islands through stage 2 fixed-service USF support for hurricane recovery is through its subsidiary Viya (see 1811080024), the sole ILEC "charged with serving the USVI in its entirety as the last resort and the sole operator of a Territory-wide wireline broadband network." USF support must be "sufficient and stable" in the "USVI where the costs of providing service are high and the economic conditions are challenging," ATN wrote of CEO Michael Prior and others' meetings with Chairman Ajit Pai, Commissioner Brendan Carr and aides to all four commissioners, posted Friday in docket 18-143.