The FCC should consider an overhaul for USF support in high-cost areas served by rural, rate of return-regulated local exchange carriers proposed by NTCA, Senior Vice President-Policy Michael Romano told Wireline Bureau officials Tuesday, said an ex parte filing (http://bit.ly/1nEbYbU) posted in docket 10-90 Wednesday. The reforms would create a “well-constructed transition over time away from legacy support mechanisms to a simple and straightforward new mechanism focused on supporting broadband-capable networks in high-cost areas served by smaller carriers,” the filing recounted he said.
The FCC Wireless and Wireline bureaus gave limited, interim relief to Alaska telco Adak Eagle Enterprises and its Windy City Cellular subsidiary Thursday. An order said Adak will receive $33,276 monthly and Windy City will receive $40,104 monthly. That funding will last no more than six months or until the commission reviews the companies’ petition for reconsideration (http://bit.ly/1tpZLfD). Adak and Windy City had petitioned the FCC for reconsideration of its denial of the companies’ request for a waiver of caps on USF payments (CD Aug 16/13 p5). Executives from Adak and Windy City urged FCC staff in a meeting last month to provide a “permanent solution” the funding issues they have sought to relieve through the waiver (CD July 29 p14).
House Republicans want input on the USF as part of their fifth white paper on overhauling the Communications Act. Commerce Committee Chairman Fred Upton, R-Mich., and Communications Subcommittee Chairman Greg Walden, R-Ore., issued the four-page document Friday, requesting responses by Sept. 19. “As a partnership between the federal and state governments, and funded by ratepayers, it is essential that we review and ensure the effectiveness of this $8 billion per year program as part of our #CommActUpdate process,” Upton and Walden said in a joint statement. “As technologies have been improved and networks upgraded, we have a responsibility to review the program to find out if the fund is still serving its purpose and if there may be better ways to accomplish its goals.” The paper asked eight questions about the nature of the fund and how the federal government manages the fund’s goals. It asked for input on what the proper state role should be as well as the USF’s role during and after the IP transition. “Are current programs at other federal agencies, like the National Telecommunications and Information Administration (which oversaw the Broadband Technology Opportunities Program) or the Rural Utility Service (which oversees lending programs and oversaw the Broadband Initiatives Program) necessary?” the white paper asked (http://1.usa.gov/1pmX66c). “How should our policies address the existence of multiple privately funded networks in many parts of the country that currently receive support?
The FCC Wireline Bureau asked Adak Eagle Enterprises (AEE) and subsidiary Windy City Cellular to submit additional information as the agency examines their petition seeking reconsideration of an order denying a waiver of agency caps on USF payments. The bureau denied the waiver sought by the Alaska companies a year ago (CD Aug 16 p5). The two later characterized themselves as “tiny companies that worked tirelessly against the odds” to offer phone service in the Alaskan wilderness “when no one else would” (http://bit.ly/1hcWStf). The bureau asked for “detailed information regarding, among other matters, corporate staffing, lease agreements, corporate operations expenses, and contracts for AEE’s wireline operations,” in a Tuesday letter (http://bit.ly/1ov9IZM).
USF contribution reform “should not be seen as a backdoor way of increasing the size of the universal service fund or imposing new fees on the Internet,” FCC Commissioner Mike O'Rielly said in a statement. The agency asked the Federal-State Joint Board on Universal Service Thursday to recommend how to modify contribution methodology (CD Aug. 7 p5). The commission approved the referral (http://bit.ly/1oh17cQ) unanimously. It referred the joint board to the commission’s 2012 Further Notice of Proposed Rulemaking on the issue, and asked for recommendations “with a particular focus on how any modifications to the contribution system would impact achievement of the statutory principle that there be state as well as federal mechanisms to preserve and advance universal service.” Network convergence and technological innovation “have transformed the telecommunications industry, and the contribution system has become increasingly complex and difficult to administer,” said the order, which asked for the recommendations by April 7. “The Joint Board process ensures that the agency will receive expert recommendations from the States officials closest to the consumers affected by changes to the Universal Service program,” said NARUC Telecommunications Chairman Chris Nelson in a statement. Nelson, vice chairman of the South Dakota Public Utilities Commission, is on the state board.
An FCC order on circulation would generically ask the agency’s Federal-State Joint Board on Universal Service to examine changes to USF contribution methodology without recommending how the group should proceed, said agency and industry officials in interviews this week.
Recognizing changing consumer Internet demands, the FCC issued a notice of inquiry (http://bit.ly/1srx6Gz) Tuesday asking if it should raise the benchmarks for defining “advanced telecommunications capability” in preparation for its national broadband progress report. Because of a “tremendous growth in the online video and audio markets in the past few years,” the NOI asked as expected (CD June 4 p1) if the agency should modify its current broadband benchmark of 4 Mbps download and 1 Mbps upload. “The demand for video services and the introduction and use of new services on the market” may mean the old benchmark “no longer allows consumers the ability to ‘originate and receive’ the broadband services identified in section 706” of the Telecom Act, NOI said. Republican commissioners concurred in part and expressed concern that higher benchmarks could bring more regulation.
Despite the FCC’s decision to delay implementing the $20.46 rate floor, problems remain, including that rural local exchange carriers (RLECs) in some states are caught in conflicts with state law and procedures, representatives of several rural telcos and the WTA Regulatory Counsel Gerry Duffy told aides to Chairman Tom Wheeler Wednesday, said an ex parte filing (http://bit.ly/1pvGIPl) posted Friday in docket 10-90. A 1995 Colorado statute that has frozen monthly local exchange service rates between $14 and $17.05 “will soon run afoul of the scheduled rate floor increases,” the telcos said. WTA supports the commission’s pending proposal to increase the minimum broadband speed that it seeks to achieve with USF from 4 Mbps to 10 Mbps downstream, the filing said. Sufficient and predictable high-cost support should be available to enable RLEC members to obtain and repay the loans necessary for the required infrastructure upgrades and extensions, the filing said. Involved in the meeting were representatives from Brad 3 Rivers Communications of Fairfield, Montana; Direct Communications of Eagle Mountain, Utah; Idaho Telecom Alliance; MTE Communications of Midvale, Idaho; New Florence Telephone Co. of New Florence, Missouri; and Pine Drive Telephone of Beulah, Colorado, the filing said.
An item to refer USF contribution methodology to the Federal-State Joint Board on Universal Service was put on circulation (http://bit.ly/1rT3IIe) by the FCC Wireline Bureau July 29.
Colorado Public Utilities Commission Chairman Joshua Epel met Tuesday with Daniel Alvarez, aide to FCC Chairman Tom Wheeler, to discuss challenges in deploying broadband to unserved areas in the state and his concerns with the “significant” decrease in Connect America Fund II funding set for Colorado compared with current USF funding levels, Epel said in an ex parte filing posted Thursday to docket 10-90. Epel also gave Alvarez a copy of the PUC’s July decision implementing emergency rules governing the Automatic Location Identification Service (http://bit.ly/1pJrROF).