Utah should persist with a state USF contribution overhaul despite AT&T and CTIA “scare tactics” meant to derail the proposed shift to a connections-based mechanism, CenturyLink said in Wednesday replies to the Public Service Commission (docket 17-R360-01). Last month, AT&T and CTIA urged the commission to retain the revenue-based method used now and by all other states (see 1707050016). The PSC should use its time between now and the Jan. 1 effective date to ensure the proposed change isn't subject to legal challenge and can be implemented in a competitive and technology-neutral way, CenturyLink replied. The PSC is authorized by state law to shift to connections-based USF contribution, so the agency should focus on how to implement the change, the Utah Rural Telecom Association said. Comcast also urged the commission to retain revenue-based contribution. “If providers are required to collect the UUSF surcharge based upon access lines or connections, then the Commission should provide specific rules to ensure that every provider counts access lines and connections for their end-user business and residential customers in the same way and collects the surcharge in the same way,” the cable company replied.
The Senate Commerce Committee ruled out plans for a hearing next week on the FCC Lifeline USF program despite earlier interest, a spokesman told us. Senate Commerce Staff Director Nick Rossi told reporters after a markup that the committee was interested in scheduling a hearing on the issue if there were certainty that the Senate wouldn't be in recess then. Senate Commerce Chairman John Thune, R-S.D., told reporters he believed the chamber was likely to recess at the end of this week, making a hearing before Labor Day unlikely. The hearing appeared likely to center on issues GAO identified in a June report on the program's continued management “weaknesses” (see 1706290037), two lobbyists said. Rep. Austin Scott, R-Ga., recently refiled his End Taxpayer Funded Cell Phones Act (HR-3546) in a bid to curb the Lifeline program. The bill failed on the House floor last year (see 1606220020).
The Senate Commerce Committee voted Wednesday to advance confirmations of FCC Chairman Ajit Pai and Commissioner nominees Brendan Carr and Jessica Rosenworcel, while negotiations to include them in a nominations package for a floor vote hadn't concluded. The committee again delayed a vote on NTIA Administrator nominee David Redl because of Texas Republican Sen. Ted Cruz's concerns about responses to his queries on last October's Internet Assigned Numbers Authority oversight transition (see 1610030042 and 1708010071).
Carriers urged a comprehensive Alaska USF overhaul by the Regulatory Commission of Alaska. Seeking to stem USF bleeding of funds, the RCA asked for feedback on a short-term USF fix to change rules about what to do in a USF shortage (see 1706300049). In comments Monday in docket R-17-001, AT&T, GCI and a rural telco coalition said they’d prefer more comprehensive USF changes. "Although AT&T understands the Commission’s desire to carve out a small area -- prioritizing disbursement of AUSF -- for a ‘quick’ rulemaking, it is difficult to do this without creating unintended consequences that impact other aspects of the fund,” commented AT&T, which receives no Alaska USF support. “By not addressing all aspects of the AUSF, the Commission is creating regulatory uncertainty for providers that depend on disbursements from the fund as well as for those providers that contribute to the fund." The Alaska Telephone Association (ATA), GCI and the rural telcos said they supported, in the case of a USF shortage, a proposal to distribute funds pro-rata based on recipients' aggregated claim for support. "Pro rata distribution of funds is fair to all AUSF recipients and is appropriate,” GCI said. The RCA should have a technical workshop to examine proposed changes to the $27 million fund, ATA commented: “Without a thorough examination, unintended consequences are likely to emerge and administration of the fund could be hindered.”
The FCC should increase funding for USF high-cost support, Wilson Communications CEO Brian Boisvert said in a Wednesday meeting with Chairman Ajit Pai, described in a Friday ex-parte notice in docket 10-90. Insufficient funding is undermining the effectiveness of March 2016 USF changes, the rural telco executive said. The budget for the high-cost program has been “stagnant since 2010,” he noted. A NARUC resolution earlier this month similarly sought more funding for the high-cost fund (see 1707180007).
Allband Communications Cooperative asked the FCC to almost double its USF support from its current $250 per line, citing a "dire need" for "prompt action." Allband requires a "minimum of $457 per line in order to continue its services and operations" as an incumbent telco "and to meet its expense obligations, including payments on its current federal loan" issued by the Agriculture Department's Rural Utilities Service (RUS), said a petition for a waiver Thursday of a Part 54.302 rule in docket 10-90. The ILEC noted a previous emergency petition for increasing its USF support to $375 per line "necessary to cover Allband's fixed costs, which costs exist irrespective of the employee time or affiliate cost allocations assigned" for Universal Service Administrative Co. review by a July 20, 2016, FCC order. "Aside from the temporary six-month partial deferral of the RUS loan payment obligation approved by RUS in March 2017, this RUS loan payment obligation equals $54,147.17 per month, or $334 per-line. ... The $250 per-line support caps imposed by the [2016 order] falls considerably short of even covering [Allband's] monthly payments on its RUS loan," it said.
CenturyLink won Washington state approval to acquire Level 3 for $34 billion, the Washington Utilities and Transportation Commission said in Thursday news release. Commissioners unanimously signed off on an all-party settlement including conditions on network maintenance, outages, USF, interconnection agreements and next-generation 911 (see 1705010039). With the conditions, the deal is “net-positive” for the state and will make CenturyLink more competitive and able to serve more people, the UTC said. “A handful of states still need to approve or clear the merger and some states require only pre-closing or post-closing notice," a CenturyLink spokeswoman emailed. "We are working diligently to finalize the remaining state, federal and international approvals in order to complete the merger by September 30.”
Senate Democrats' search for a candidate to succeed FCC Commissioner Mignon Clyburn if she decides to exit remains wide open, though lawmakers have candidate qualities in mind, lobbyists and former officials told us. Clyburn hasn't announced any plans, and her current term ended June 30. Clyburn can stay likely until the end of this Congress unless succeeded by another Democratic commissioner.
The Regulatory Commission of Alaska opened a rulemaking to conform state Lifeline eligibility criteria with the federal low-income program. At a Wednesday meeting, commissioners voted unanimously to open the rulemaking and seek comment on whether to expand its scope. The agency separately is mulling broader state USF overhaul (see 1706300049). Also, commissioners agreed to open a staff investigation to inform a report due Dec. 1 to the Legislature about broadband coverage, planned expansions and gaps in broadband infrastructure and financing.
NTCA said the FCC record backs eliminating a USF rate floor that requires rate-of-return telcos to charge customers a certain monthly amount for basic voice service to receive subsidy support (see 1707110055). "Nearly every party commenting on [an] NPRM agrees that the provision should be eliminated," the rural telco group said in a reply posted Tuesday in docket 10-90. Rural customers are penalized with annual rate increases that burden both state commissions, which must review them, and small carriers, which must make filings and notify customers, the group said. "The latter process also strains the relationship between [rural telcos] and their customers." It said support of cable's NCTA for keeping the rate floor in some form "inexplicably misses what the NPRM and all other parties do not; High Cost Loop Support funding reductions flowing from non-compliance with the rate floor do not accrue back to ratepayers. Such support is redistributed to other carriers by operation of the Commission’s rules."