States, Industry Slam FCC Proposal on Phone Access Charges

The proposal to detariff is “unworkable,” USTelecom said. “It would force carriers to entirely convert traditionally interstate charges subject to federal regulation into intrastate charges subject to state regulation,” USTelecom commented: “This is no small feat. It would require substantial effort, navigation of state regulations and approvals, and major changes to pricing and billing.”

Nothing in the record justifies or gives legal basis to act, commented NARUC. The proposal is “far more likely to increase confusion over customer bills than reduce it,” and the most common modification suggested -- creating a separate interstate surcharge to replace those that the NPRM would eliminate -- “is unlikely to decrease any alleged consumer confusion,” the state regulator association said. “At a minimum, before acting, the FCC should consider discussing the separations and universal service issues clearly implicated by the NPRM proposals with" relevant regulatory boards.

The plan doesn’t properly consider state oversight of intrastate services and phone rates, while plotting “impermissible jurisdictional cost shifts without the necessary and prior consultation with the Federal-State Joint Board on Separations,” said the Pennsylvania Public Utility Commission. The proposals would “threaten the financial stability” of Verizon in Washington, because the city's price cap limits the carrier from increasing intrastate rates to cover the detariffed TACs, noted the District of Columbia Public Service Commission. California and Massachusetts commissions also raised USF and separations issues.

Incompas said of 22 initial comments, 17 opposed the tweaks and the remaining five had reservations. “The various state regulatory requirements will ultimately impact the ability of carriers to recover their costs,” Incompas said. “Many states have adopted limited price flexibility for carriers, which either means carriers will not be able to recover their costs or it will be a procedural nightmare to do so.”

NTCA raised COVID-19 objections. “Even under normal circumstances, mandatory detariffing of the charges at issue would only promote confusion and disruption as consumers see charges disappear in one place only to reappear in another on invoices,” NTCA said. “This disruption to consumers and carriers alike will only be exacerbated” now.

Verizon supports revisions, but not as laid out. “These contemplated changes would lead to harmful outcomes -- including several the Commission expressly opposes -- and have generated a record of near-uniform concern and objection,” the carrier said: “States and other commenters explain why the proposals are unworkable under the existing regulatory framework.” Verizon cited reasons the revamp wouldn’t work in individual states.

The record is clear -- TAC deregulation is not warranted ,” said the Small Company Coalition of rural telecom and broadband providers: “The proposed detariffing and deregulation of TACs is not supported by any need.”

Public Knowledge backed the state and industry arguments, citing concerns about the USF and the potential for customer confusion. “The NPRM disrupts USF contribution calculations without any basis, and also negatively impacts several state models that have built their own USF systems in reliance on the current Federal calculation model,” PK said.

The NPRM was supported by the Ad Hoc Telecom Users Committee. This deregulation and changes to billing simplicity and transparency need not “occur in tandem,” it said. “Contrary to the assertions and concerns of some commenters, this overdue detariffing action would have no effect on separations or state USF programs."