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Too Soon to Act?

ISPs Slam Consumer Group Seeking Calif. Response to ACP Wind-Down

The possible end of the federal affordable connectivity program (ACP) isn't an excuse to make sweeping changes to state broadband grant rules, ISPs told the California Public Utilities Commission this week. In Monday comments (docket R.20-08-021), AT&T, Frontier Communications, cable companies and small rural local exchange carriers urged the CPUC to swiftly reject last month’s The Utility Reform Network (TURN) petition to modify rules for the California Advanced Services Fund (CASF) broadband infrastructure account (see 2404150062).

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TURN is seeking changes to the California commission’s 2022 decision on the infrastructure program in which the CPUC committed to identifying a successor low-income subsidy program if the ACP were to end. The consumer group asked the CPUC to pause making awards until it updates rules to account for ACP’s end and to direct applicants to amend already filed applications. TURN proposed requiring carrier of last resort (COLR) applicants “to provide a bundled voice and broadband plan that qualifies for both California and federal Lifeline subsidies" for the life of the project's infrastructure. Also, TURN proposed requiring non-COLR applicants "to offer a plan that meets or exceeds the federal Lifeline broadband minimum speed and data allowance standards for $15 per month for the life of their project’s infrastructure."

"TURN seizes upon the impending phase-out of the [ACP] to seek unsupported changes to the [CASF] program rules that TURN was unable to broker” in previous stages of the proceeding, protested Frontier. The consumer group’s petition "would fundamentally and retrospectively alter the terms of more than 70 pending CASF grant proposals, including 12 proposed projects from Frontier,” the telecom company said. "It would be devastating to the viability of these projects for the Commission to retroactively modify the rules to incorporate a one-size-fits-all mandate of a $15/month [plan] and then apply this requirement for the life of the project’s infrastructure.” The CPUC’s 2022 decision didn't "contemplate that a 'successor program' to ACP would involve the post-hoc application of an unfunded mandate on CASF applicants.”

AT&T similarly accused TURN of using “the end of ACP as a backdoor to relitigate issues previously considered by the Commission" and "as an improper attempt to discriminate against” COLR providers. "Changing the rules for a specific class of service providers will alter the landscape of all involved parties, have a chilling effect that will limit participation, and will delay the deployment of broadband services to Californians,” AT&T commented. The CPUC didn't intend for California LifeLine and federal Lifeline to be successor programs to the ACP, it said. Also, AT&T noted that "the only applications affected by the end of ACP are those that rely solely on” that federal funding source for their projects to work. The CPUC “should continue evaluating the majority of applications that do not rely on ACP participation and only require applicants that solely rely on ACP to amend their applications with a successor program.”

The state cable association agreed with the big phone companies. By asking the FCC to impose a "mandatory unsubsidized low-income broadband plan requirement for the life of the infrastructure," said the California Broadband & Video Association, TURN’s petition “invokes the current wind-down and potential end of the ACP to attempt to re-litigate ... settled issues and fundamentally change the terms of participation in the [broadband infrastructure] program -- after applications have been submitted under the existing rules.” Lifetime price restrictions are uneconomic and unrealistic, said the cable group: TURN’s proposal could discourage participation in the grant program and undermine already funded projects’ viability.

It’s “premature to take any action before there is certainty around future ACP funding or the availability of any federal successor programs,” added the state cable association: Possible congressional action on ACP could moot the petition. Rather than grant TURN’s petition, the CPUC should “consider all subsidy options that may emerge to replace the ACP, build a complete record with more opportunities for public input, and aim for as much clarity as possible in administering its broadband grant programs," the cable group said. Then the CPUC "can act based on its existing rules to designate 'a successor low-income subsidy program' that is substantially similar to the ACP and will apply consistently across grant-funded deployments.” In the meantime, the group’s cable members can still offer affordable broadband plans to eligible consumers, it said.

Don’t relitigate settled issues, echoed small RLECs, including CalTel and Ducor Telephone. "Rather than attempting to retrospectively alter the terms of CASF grants and establish a series of onerous requirements that will deter infrastructure investment through the program, the Commission should address the support issues surrounding low-income broadband in the LifeLine proceeding, R.20-02-008,” they said. "Regardless of this potential evaluation in the LifeLine arena, the instant Petition is misguided and should be denied with prejudice." TURN’s proposal "would be a strong disincentive to participation in the CASF program," with the resulting problems likely to be "particularly acute" for small carriers, the small telcos said.