FCC Should Take Intermediate Steps to Address High Cost USF Budget Shortfall, Pai Tells Lawmakers
The FCC “should address the uncertainty caused by the current budget control mechanism” for the High-Cost USF program through actions like “guaranteeing at least some minimum level of support to ease the unpredictability and allow reasonable capital planning” while also…
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“being mindful of mitigating incentives to operate inefficiently,” said FCC Chairman Ajit Pai in letters to 37 House lawmakers released Friday. Reps. Kevin Cramer, R-N.D., and Collin Peterson, D-Minn., led a letter from the lawmakers last month that urged the FCC to do a review of the program budget and proposed an interim change aimed at mitigating current budget constraints before a review (see 1710030074). The lawmakers raised similar concerns in May (see 1705020056). Pai bemoaned the FCC's 2016 rate-of-return order for not having “its intended effect,” noting his own opposition to the rule. “I repeatedly hear from small carriers that offering stand-alone broadband would put them underwater, that the rates they have to charge exceed the rates for bundled services because of the different regulatory treatment,” he said. “This is unfortunate but unsurprising.” More “fundamental reforms are needed” to address the “punch list of lingering issues” from the 2016 order, Pai said. Until that revamp happens, “I am committed to exploring how this situation can be changed and to determine the appropriate budget levels,” Pai said.