Legislative Calendar Weighted Against Quick USF Fix: CCA's Donovan
Competitive Carriers Association CEO Tim Donovan said he remains worried about what the U.S. Supreme Court will decide on the USF's constitutionality, though he also expressed optimism that the program will survive the Consumers' Research challenge (see 2504140039). Donovan spoke during a Free State Foundation webcast this week, hosted by former FCC Commissioner Mike O’Rielly.
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“I can’t think of a more existential issue than the constitutionality of the universal service fund,” Donovan said. “It has been a journey. We’ve been defending the [USF] for several years now.” Overturning it would be “absolutely devastating” for CCA members and consumers, he said, noting that some wouldn’t be able to make payroll and would have to close their doors without USF support.
Donovan said he expects a SCOTUS decision “any day now,” since the court traditionally hands down some of its biggest rulings in June.
Congress seems willing to act if the USF is overturned, he said, “but legislating is hard and takes time.” Until SCOTUS acts, it’s difficult to figure out what a “quick fix” would look like to save the program, he said.
Donovan warned that after the reconciliation package now before the Senate, there won’t be any “must-pass” legislation until September. DOD authorization is probably “the most consistent must-pass that we’ve seen over the past several decades,” he said. Last year, the most recent National Defense Authorization Act was the vehicle used to authorize an AWS-3 reauction and fully fund the FCC’s Secure and Trusted Communications Networks Reimbursement Program (see 2412180027).
“We will look at any opportunity to get this through," Donovan said. "Our guiding star has to be to maintain the [USF] program.”
Congress would have difficulty doing both a quick fix and broader USF reform at the same time, Donovan predicted. When bills get bigger and take on more issues, “you pull in more stakeholders and views, and it becomes more challenging.”
CCA members participate in all the USF programs, especially the high-cost program, he said. They offer service in “rural areas that are hard to serve.” Most people don’t realize they’re using a USF-funded network when they’re traveling in sparsely populated areas of the country and roaming on small carrier networks, he said. Those networks provide connections, including during emergencies, he added.
Following oral argument, Donovan was concerned about some of the more conservative justices asking whether USF could be seen as “a tax without limits,” he said, explaining that industry sees it as a fee, not a tax. He said he was surprised the justices asked few questions about the private delegation issue raised by Consumers’ Research.
O’Rielly said he was “struck” by questions on whether there should be an overall cap on USF fees. Oral argument seemed to be more of “an intellectual debate,” rather than focusing on the “ramifications” of USF being overturned, he said.
Donovan said CCA members would probably support a USF cap, but it would have to be at the right level. “We would need to take a step back and see what makes sense for that cap for what the program is trying to do.”
Donovan also noted that CCA challenged parts of the FCC’s 5G Fund order in the U.S. Court of Appeals for the D.C. Circuit, seeking changes to the rules the agency adopted last year (see 2408290041). The challenge asked whether the fund’s budget was the right amount, he said. The FCC approved “an arbitrary number,” and “we think we could use some better data to figure out what the right budget is.”