Smart meters and smart grids should be excluded from assessable services that are subject to USF contributions, the National Rural Electric Cooperative Association, Edison Electric Institute, and Utilities Telecom Council told FCC Wireline Bureau officials Tuesday, an ex parte filing said (http://xrl.us/bnqofz). “Smart meters and smart grids are not interstate telecommunications or interstate telecommunications services, nor would the public interest be served by subjecting smart meters and smart grids to USF contributions,” the groups said. “Moreover, it would conflict with the regulatory authority of other agencies and would be administratively infeasible to collect USF from utility customers.” Excluding smart meters and smart grids would promote marketplace innovation, energy efficiency, reliability and security, they said.
EchoStar, Dish and Hughes urged the FCC to finish its work on the structure of the Connect America Fund before expanding the base of services contributing to the universal service fund. Until that work is complete, it’s difficult for satellite broadband providers “to evaluate whether the new contribution regime is equitable and non-discriminatory as required by statute,” they said in a joint filing in docket 06-122 (http://xrl.us/bnqnsw). The USF contribution mechanism “must be updated to better reflect the marketplace,” the filing said. The CAF, if not structured properly, “could subsidize less-efficient terrestrial technologies to provide service to the same customers that satellite broadband providers are investing their own funds to serve.” It wouldn’t be competitively neutral or equitable to mandate that satellite broadband providers contribute to USF “if they are arbitrarily excluded from receiving support in areas where they are the most-efficient provider, and high-cost funding instead is channeled to subsidize their less-efficient competitors to extend service to areas where satellite service would be more efficient,” the companies added.
The FCC is unlikely to even start collecting data on special access rates until next year, Wireline Bureau Chief Julie Veach conceded at an FCBA lunch Wednesday. She said the data collection order is almost ready, but once it’s finalized by the commission it still faces review by the Office of Management and Budget. The OMB must vet it under the Paperwork Reduction Act.
The FCC needs to act on the application of Adak Eagle Enterprises and Windy City Cellular for a waiver of USF rules, CEO Larry Mayes said in a meeting with Priscilla Argeris, aide to Commissioner Jessica Rosenworcel. The companies serve remote Adak Island, Alaska. “WCC and AEE emphasized that it has been 163 days since the WCC Petition was filed and 114 days since the AEE Petition was filed,” the companies said in an ex parte filing (http://xrl.us/bnqbvm). “The companies have received no indication of when the Commission will move forward with a final decision on either Petition,” the filing said. “The companies have promptly responded to all requests for information, and have consistently offered to provide whatever additional information staff desires in order to expeditiously reach a decision.” Costs continue to mount, Mayes said. “The waiver process has been extremely expensive, onerous and frustrating for a small carrier that is now operating at a loss for both its wireless and wireline services while continuing to provide these services to remote Adak Island.” For WCC to continue providing wireless service to residents of Adak, it will need a two-year delay and five-year phased-in implementation of certain universal service rules, the filing said: “At a minimum,” WCC will need “funding sufficient to cover operations until Mobility Fund Phase II support is made available."
The FCC should use an annual USF access tariff allocation method based on total eligible recovery amounts rather than interstate base period revenue, the National Exchange Carrier Association told Wireline Bureau officials, an ex parte filing said (http://xrl.us/bnp6na). NECA intends to propose to continue the pooling process by reallocating billed switch access revenues to pooling companies with positive eligible recovery, it said.
In light of “ballooning federal USF charges,” the FCC should shift to a “fair, workable and future-proof” connections-based contribution mechanism, Google representatives told FCC Wireline Bureau officials and aides to commissioners Mignon Clyburn and Ajit Pai Wednesday, an ex parte filing said (http://xrl.us/bnp6k3). “A wide cross-section of commenters have described numerous benefits that could flow from a connections-based system, including greater equity, reduced administrative burdens, and greater simplicity,” Google wrote.
The FCC should make clear that Short Message Service revenue is exempt from the USF and “will remain so until all competing services (such as iMessage, Facebook messaging, and Google’s GChat, among others) are required to contribute, in order to prevent competitive imbalance,” MetroPCS officials said in a meeting with aides to Chairman Julius Genachowski and Commissioner Robert McDowell. MetroPCS also made other suggestions (http://xrl.us/bnprp4). The FCC should also “create a system where carriers can seek informal guidance on USF contribution matters, perhaps in a manner similar to the Internal Revenue Services’ private letter ruling process” and “extend the time for carriers to seek refunds on USF contribution overpayments and eliminate the asymmetry between a carrier’s ability to file for a refund and the Commission’s ability to recoup past underpayments, as the current system artificially encourages carriers to be more aggressive in their revenue classification positions,” the carrier said.
The FCC’s budget for salaries and expenses would be cut 8.2 percent, equal to roughly $28 million, if a Congress doesn’t act to stop sequestration before Jan. 2, the White House said. The news came in the administration’s much anticipated sequestration report Friday, which detailed sharp across-the-board cuts to the budgets of most federal agencies. An industry group and a union representing FCC employees said the report shows the negative impact that sequestration will have on federal employees, private industry and the economy as a whole.
Industry and agency officials gathered at the FCC Thursday for a detailed explanation of the proposed Connect America Fund Phase II cost model, presented by CostQuest Associates. The goal of the CostQuest broadband analysis tool (CQBAT) is to identify the high-cost portions of broadband buildout throughout the country, defined by the ABC Coalition as anything over $80. A map presented at the meeting showed most of the high-cost areas exist in the western half of the country, and some loops can even cost in excess of a million dollars. This can happen when a dedicated plant is required to serve a single customer, said CostQuest President James Stegeman.
Rep. Joe Barton, R-Texas, said it may be time for Congress to abolish the USF. The senior House Commerce Committee member and its former chairman spoke in a C-SPAN interview about the fund created by the Telecom Act of 1996 and being expanded by the FCC to cover broadband. Barton, on an episode of The Communicators to be shown Saturday and Monday, was sharply critical of FCC net neutrality rules. Limited privacy legislation could still be enacted in 2012, he said.