The 6th U.S. Circuit Court of Appeals denied Consumers' Research's challenge of the FCC's USF 2021 Q4 contribution factor, in an opinion published Thursday in case 21-3886. A three-judge panel heard oral argument in March and is the second court to deny a challenge from the group (see 2303240049). "Congress provided the FCC with a detailed statutory framework regarding universal service," wrote Judge Karen Nelson Moore, saying Section 254 of the Communications Act "does not violate the nondelegation doctrine." The opinion also cited the Universal Service Administrative Co.'s "subordination to the FCC and its assistance with fact gathering and ministerial support" wasn't a "private-nondelegation doctrine violation." Competitive Carriers Association, NTCA and USTelecom welcomed the ruling in a joint statement: "We believe that other courts considering similar challenges should come to the same conclusion.” Consumers' Research didn't comment.

Texas may cut its state USF surcharge in half this summer. The Texas Public Utility Commission plans to consider a draft order at its May 11 meeting to reduce the revenue-based fee to 12% from 24%, effective July 1, said a PUC memo Thursday in docket 50796. In July, the PUC hiked the rate to 24% from 3.3% after a state court said Texas commissioners violated the state’s constitution and utility and administrative procedure laws by choosing in June 2020 not to fully fund TUSF by doubling the surcharge to 6.4% (see 2207140060). The PUC expects to complete “the arrearage and interest payments to eligible telecommunications providers by July 2023 and subsequently proposes reducing the TUSF assessment rate by half,” said the memo. The Texas House passed a constitutional amendment last week that would set up a broadband fund that could reduce pressure on state USF (see 2304270056).

Consumers' Research asked the FCC to set the Q3 USF contribution factor to zero, saying in comments posted Wednesday in docket 96-45 that the Office of Managing Director should "do the same for all future proposed universal service contribution factors due to the illegality of this entire scheme and process." The group has several pending legal challenges of prior quarterly USF contribution factors (see 2304060042).

Texas legislators unanimously supported extending a Sept. 1 sunset on USF support for small telcos until Sept. 1, 2033. The House voted 145-0 Wednesday for SB-1425 after the Senate last month voted 31-0. The bill still needs a signature from Gov. Greg Abbott (R). On Tuesday, the House passed a broadband bill (SB-1238) with amendments in a 132-7 vote. It would update Texas laws to declare a fiber preference and otherwise prepare for incoming federal dollars from NTIA’s broadband, equity, access and deployment program. Texas House members last week showed wide support for a constitutional amendment to create a state broadband fund (see 2304270056). The Texas Statewide Telephone Cooperative applauded SB-1425 passage. "TSTCI appreciates the legislature’s efforts to keep a methodology in place that promotes accountability, and regulatory efficiency, in determining and adjusting [Texas USF] distributions to this segment of the industry," said TSTCI President Allen Hyer.

Chickasaw Telephone and Totah Communications asked the FCC to adopt the Alternative Connect America Model (ACAM) Broadband Coalition’s proposal to modernize ACAM, saying “time was of the essence” (see 2205190023). The providers, in a meeting with aides to Commissioner Brendan Carr, backed waiving the budget control mechanism for Connect America Fund-broadband loop support recipients for “at least the rapidly approaching support year,” said an ex parte filing posted Tuesday in docket 21-476. “Without such a waiver, CAF-BLS recipients will be adversely impacted by a very significant reduction of their support,” the providers said. They also noted the “justification for contributions of large edge providers” to the USF, citing the “increased middle mile and last mile costs caused by video streaming.”

Former FCC nominee Gigi Sohn told reporters Wednesday she’s ready for her next act in the communications policy space, after her withdrawal from contention for the vacant commission slot almost two months ago (see 2303070082). Sohn confirmed during and after an appearance at a Broadband Communities event in Houston that she will sign on in June as the American Association for Public Broadband’s first executive director. The House Commerce Oversight Subcommittee, meanwhile, plans a May 10 hearing on the government’s administration of $65 billion in broadband funding from the Infrastructure Investment and Jobs Act and other federal programs.

The USF contribution factor will likely increase to 30.3% during Q3 2023 from 29.0% during Q2, emailed analyst Billy Jack Gregg Tuesday. Gregg noted the increase in overall USF demand will result from the "demand for three of the constituent funds of the USF" and decrease in the E-rate program.

WILLIAMSBURG, Va. -- Quickly restoring FCC spectrum auction authority is critical with the World Radiocommunication Conference approaching in late fall, said government officials at the FCBA annual seminar Friday and Saturday. FCBA members heard from FCC commissioners and NTIA officials on a variety of other issues, including possible "Buy America" waivers for the broadband equity, access and deployment (BEAD) program.

Senate Communications Subcommittee Chairman Ben Ray Lujan, D-N.M., confirmed Thursday he plans a hearing as soon as the second week of May with a primary focus on a potential legislative USF revamp. “My intention is for the focus to be in and around USF” given ongoing work with Communications ranking member John Thune, R-S.D., to “create a working group” to draft a legislative revamp, Lujan told us. “Thus far it feels like there’s bipartisan interest from all sides,” so “I’m hopeful this hearing will bring” the issue onto “the front burner and maybe can act as a catalyst for us all to work together and get things done.” Lujan and former Senate Commerce Committee ranking member Roger Wicker, R-Miss., refiled the Funding Affordable Internet with Reliable (Fair) Contributions Act last month to direct an FCC study of expanding the USF funding pool to include edge providers like Google-owned YouTube and Netflix (see 2303160080). Thune and Sen. Amy Klobuchar, D-Minn., refiled the Reforming Broadband Connectivity Act in late March in a bid to revamp USF's funding mechanism (see 2303280071).

Texas House members showed wide support for creating a state fund for broadband infrastructure this week, voting 137-7 for a proposed constitutional amendment Wednesday on its second reading. On Thursday, the Senate received HJR-125 and the House voted 140-8 for companion bill HB-9 on third and final reading. Rural carriers applauded the House for passing the measures, which they said would help fill gaps from the state not fully funding Texas USF. “We will now shift our focus to the Senate where we hope to find similar support,” said Texas Telephone Association (TTA) President Mark Seale.