RDOF Heats Up Before FCC Sunshine Period Starts
ISPs, states and others looking for changes to a draft Rural Digital Opportunity Fund order up for a vote Thursday make their last requests to FCC officials this week. Sunshine rules govern industry ex parte on matters before the commission a week before the Jan. 30 meeting. Commissioners and aides said the RDOF item is dominating their time on the agency's top, eighth floor. They said it has been a big focus this week.
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More interests lobbied the agency to relax letter of credit requirements. The issue has gotten considerable attention, including from many telecom groups that sought a change in the draft.
NARUC wants the FCC to revise the LOC requirements. Program success "is contingent upon the participation" of both small and large broadband providers, "and on the assurance that these support dollars are dedicated to broadband expansion and not unnecessarily diverted from infrastructure investments," it said in docket 19-126.
Rural broadband lender CoBank said the item "does not address the reality that many communications companies lack sufficient financing capacity and collateral to meet" LOC requirements. "An awardee's debt capacity is mainly determined by existing operations and cash flows," CoBank wrote. If LOC requirements are "reduced to one year with additional reporting requirements, more companies will be able to participate in the reverse auction and capital will be leveraged more effectively to deploy rural broadband."
New Hampshire Gov. Chris Sununu (R) raised concerns that the proposal asks bidders to incrementally increase annual LOC requirements, making it "impossible for companies in New Hampshire to take on a substantial broadband build commitment." He asked the FCC to "reduce barriers to expanding broadband" by excluding the LOC requirement.
CenturyLink supports the USTelecom proposal on LOC requirements, it said. "The essence of the proposal is that a participant in the RDOF can reduce its letter of credit obligations proportionately by deploying ahead of currently scheduled milestones," USTelecom said. In a teleconference with journalists and the group's members Thursday, National Rural Electric Cooperative Association officials supported the USTelecom approach. NRECA filed, too.
The California Public Utilities Commission has different concerns and said RDOF isn't aligned with "critical state efforts" introduced in its Jan. 10 "Broadband for All" initiative. "A more appropriate approach would be disbursing the funds in smaller amounts, using more accurate data over a longer period," CPUC President Marybel Batjer said in a letter posted to docket 19-126 Thursday. She wants California to play a role in where the funding is deployed. CPUC also met with FCC officials last week to urge delay of the RDOF auctions.
Trade groups representing different technologies disagree on an RDOF draft clearing round provision that would favor gigabit network bids after the first round met the assigned budget. NTCA said the clearing round provision would mitigate its concerns over a new 50/5 Mbps speed tier proposal. The Wireless ISP Association wants all RDOF bidders to "remain eligible in the auction until the total sum of the bids was 50 percent of the $16 billion budget" for the first phase of the reverse auction.