Representatives of the National Telecommunications Cooperative Association discussed “ongoing concerns” on the “transparency, accuracy, and predictability of regression analysis-based caps on universal service fund support,” in a meeting with aides to Commissioners Robert McDowell, Ajit Pai and Jessica Rosenworcel. “NTCA raised the need to address these issues consistent with the Applications for Review filed by NTCA and many others,” the group said in an ex parte filing (http://xrl.us/bnmn8d). “NTCA further asserted that the Commission’s broadband policy objectives can only be achieved through clear and well-tested ‘business rules’ that provide sufficient support and enable company managers to predict with a reasonable degree of certainty what investments and operations will be recoverable (or unrecoverable) through USF support prospectively. NTCA explained that many of the necessary and appropriate changes can be achieved in short order without affecting USF ‘budgetary’ objectives or creating any technical or administrative concerns, and expressed commitment to working with the Commission to address these issues."
The 2012 version of the FCC’s annual Section 706 report released Tuesday said once again that broadband “is not yet being deployed ’to all Americans’ in a reasonable and timely fashion.” Commissioners Robert McDowell and Ajit Pai issued blistering dissents. McDowell said the FCC majority has “co-opted” the 706 process, using it to justify a “'cynical cycle’ of regulation,” including the approval of net neutrality rules in December 2010.
Verizon is endangering Prairie Mountain, a small town in central Texas, with bad service, two representatives of the town told the Texas Public Utility Commission during a Friday hearing. The carrier has provided a “continuous decline” in service over the last decade or so, said resident Wallace Klussman. The population of Llano County, home to the town, is just above 19,000.
Assessing USF contributions on special access services bought by competitive LECs and used as an input to downstream retail broadband Internet access services violates the principle of competitive neutrality, tw telecom told an aide to FCC Chairman Julius Genachowski, an ex parte filing said (http://xrl.us/bnk4x7). That’s because no USF contribution is assessed where a firm provides broadband Internet access using its own facilities or unbundled network elements, the telco said. The commission could fix this discriminatory treatment by permitting wholesalers to rely on certifications from their wholesale customers on a company-by-company basis, tw telecom said.
The FCC’s broadband policy objectives can only be achieved through clear and well tested “business rules” that provide sufficient support and enable company managers to prospectively predict which investments and operations will be recoverable through USF support, the National Telecommunications Cooperative Association told an aide to Chairman Julius Genachowski Wednesday, an ex parte filing said (http://xrl.us/bnk4u4). The necessary changes can be achieved quickly without affecting USF “budgetary” objectives, or creating any technical or administrative concerns, NTCA said.
Lawmakers and rural telcos continued to protest the high costs and burdensome requirements of the FCC’s USF/intercarrier reform waiver requirements, which they say will curb broadband deployment in areas where people need it most. House and Senate members told us the FCC must do something to reduce the cost of waiver applications, which they said can exceed $100,000. A commission spokesman said it’s considering some changes to the waiver process, but emphasized that the waiver requirements are necessary to properly evaluate each company’s ability to use the money in a fiscally responsible way.
There is a general consensus within the industry that the current wholesale/resale certification process is not working, the Independent Telephone and Telecommunications Alliance told an aide to FCC Commissioner Ajit Pai Tuesday, an ex parte filing said (http://xrl.us/bnkyuq). “Not only is it administratively burdensome for wholesale carriers, it also creates incentives for resale customers to provide inaccurate certifications” to avoid USF line item charges, ITTA said. ITTA said it endorses Cincinnati Bell’s reform proposal, under which the resale customer would provide the wholesale carrier with its Form 499 ID and the wholesale carrier would check this against the Form 499 Filer ID database to identify whether the resale customer is a contributor. If the reseller contributes to the USF, the wholesale carrier would not be obligated to contribute on the basis of the telecom services it sells to the reseller. If the commission decides to require service-specific certifications, as proposed in the contributions reform further notice of proposed rulemaking, “it must give carriers sufficient time to adopt the new system and specific guidance on how to implement it to avoid uncertainty and confusion,” ITTA said.
New York state established a new high-cost universal service fund Thursday, the New York State Public Service Commission ruled. It said the fund will ensure state residents retain access to phone service in high-cost rural areas. The commission approved the phase 2 USF joint proposal in a 4-0 vote, with one commissioner recusing himself. The fund will provide $17 million to as many as 31 eligible telco recipients over a four-year period.
Verizon urged the FCC to make clear that wholesale providers can’t be forced to make USF contributions on behalf of carrier-customers when they obtain a reseller certification from those customers, said an ex parte filing (http://xrl.us/bnkun3). In a meeting Tuesday with an aide to Commissioner Robert McDowell, Verizon executives discussed the joint petition of AT&T, CenturyLink, SureWest, and Verizon for clarification or partial reconsideration of a 2010 order directing TelePacific to give the Universal Service Administrative Co. the names and contact information of its wholesale providers of transmission services. Verizon asked the commission to clarify that wholesale providers that complied with the directions in the Form 499 worksheet instructions can’t be made to restate their revenue and make additional contributions to the fund “if it later turns out that a reseller, for whatever reason, either should not have signed a certification or should have submitted a modified certification,” the ex parte said. Verizon also said no commission rule prohibits a customer from accurately certifying on an entity basis that it is a reseller; and that any requirement for resellers to apportion their wholesale purchases would require costly changes to ordering, billing and reporting systems, and would increase carriers’ burden of administering the contribution system.
A federal court of appeals denied the National Telecommunications Cooperative Association’s request to stay implementation of the new reimbursement limits on certain capital and operating expenses in its USF order. In its order Monday in Case No. 11-9900, the 10th U.S. Circuit Court of Appeals said it was “not convinced that petitioner has carried its burden of showing that the circumstances justify an exercise of the court’s discretion to enter a stay in this matter.” The court also declined to order the FCC to rule on NTCA’s pending application for review before implementing the new reimbursement limits. NTCA had argued the new capping methodology would violate the commission’s statutory mandate to deploy predictable and sufficient mechanisms to advance universal service (CD July 2 p12). NTCA had also argued that inaccuracies in the data set used to designate geographic boundary areas and to compute the formulas’ coefficients’ and retroactive application to limit reimbursements for expenses incurred in past years. In a statement Tuesday, NTCA Senior Vice President-Policy Michael Romano said the association had recognized the “high procedural hurdle” to obtaining a stay, but the “pervasive and paralyzing uncertainty” of the caps justified the effort. “We anticipate that once the court has the full opportunity to consider how the FCC’s caps retroactively cut support for past investments and are undermining incentives to invest in broadband moving forward, the court will find that these caps are contrary to the fundamental statutory requirements of universal service,” he said.