FCC Hits Brakes on USF Non-Rural Overhaul
The FCC tentatively concluded that the timing of the National Broadband Plan makes it impossible to overhaul the Universal Service Fund high-cost support mechanism for non-rural carriers like Qwest “at this time.” The commission had committed to answer a remand by the 10th U.S. Circuit Court of Appeals on the subject by April 16. In a further notice of proposed rulemaking released late Tuesday, the commission sought comment on specific “interim changes” to address the court’s concerns and marketplace changes. While voting for the order, Commissioners Meredith Baker and Robert McDowell expressed some disappointment that the notice didn’t say more.
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The broadband plan, due Feb. 17, is likely to recommend comprehensive changes to USF which the FCC will have to implement, the FCC said. The FCC doesn’t expect to finish that process in two months, it said, so the agency tentatively concluded not to “attempt wholesale reform” of non-rural support, and in the interim keep the current mechanism for carriers like Qwest that serve high-cost areas with too many lines to be considered “rural” under the statutory definition. The FCC sought comment on what changes should be made to FCC rules regarding how to compare rates between rural and urban areas, and whether it should require carriers “to certify they offer bundled local and long distance services at reasonably comparable rural and urban rates.” Comments are due 30 days after publication in the Federal Register, with replies due 15 days later.
In a concurring statement, McDowell said he’s concerned “that the substance of this FNPRM does not go far enough to answer some of the court’s fundamental questions regarding the non rural high-cost mechanism.” McDowell said he recognizes the agency has a broadband plan to finish: “Nevertheless, I do not think that the Commission’s work on the National Broadband Plan should foreclose the Commission from exploring a variety of reform ideas in this matter.”
Baker is “concerned about whether the tentative conclusions in this item, if ultimately adopted, fully satisfy the concerns of the court,” she said in her concurring statement. “We have committed to address this remand by April 2010, and I expect that the non-rural high-cost mechanism will be considered as part of comprehensive reform as well. I hope a robust record will be developed, and I look forward to supporting an order in this proceeding that both resolves the court’s concerns and makes sense in light of the National Broadband Plan.”
The Independent Telephone & Telecommunications Alliance worries that the FCC is indefinitely punting the non-rural issue, said ITTA Vice President Joshua Seidemann. “ITTA recognizes the complicated, intertwined efforts involving broadband, USF, and ICC,” he said. “ITTA is concerned, however, that the FCC’s categorization today … of ‘comprehensive’ USF reform as a ‘long-term option’ could push ultimate treatment of non-rural high-cost areas far into the future. Visions of future overhauls should not foreclose immediately beneficial amendments such as those proposed by the mid-size carriers.”
“Twice in the past six years the 10th U.S. Circuit Court of Appeals has directed the FCC to fix the rules for high-cost universal service support,” said Steve Davis, Qwest senior vice president. “We trust the commission will use this NPRM to comply with the court’s rulings by next April, as it told the court it would.”