Monica Hogan

FCC commissioners voted Thursday to release for comment an NPRM for a $20.4 billion Rural Digital Opportunity Fund. Commissioners Jessica Rosenworcel and Geoffrey Starks dissented in part, but all the commissioners and Chairman Ajit Pai said the new USF subsidies would play a big role in helping close the digital divide. The pushback from the two Democrats was expected (see 1907300072).

Despite last-minute opposition from lawmakers, the FCC didn't pull from Thursday's meeting agenda an order on overhauling the way it subsidizes participants in its Rural Health Care (RHC) program (see 1907310055). Industry stakeholders also had asked for a delay or revisions to the draft in docket 17-310, which will adjust the way rates are determined when providing telehealth subsidies to rural healthcare providers (see 1907230005).

Mutliline telephone systems (MLTS) providers and equipment vendors proposed changes in how the FCC implements new laws on better 911 access, in recent ex parte correspondence in docket 18-261. The commissioners are expected to vote Thursday on a draft report and order circulated in mid-July on implementing Ray Baum's Act (see 1902150036) and Kari's Law Act of 2017 (see 1907090047) to provide better location identification to emergency workers who take phone calls from apartment buildings, offices and other multi-unit spaces and to ensure callers who use MLTS phones can reach 911 quickly (see 1812110025).

Opposition poured in to an FCC proposal to cap the overall budget for the various USF programs and to combine the budget cap for two mechanisms to fund anchor institutions, in comments posted through Tuesday to docket 06-122. Stakeholders said such a plan would be difficult to implement and contradicts both the USF mission and the current FCC chairman's top priority to close the digital divide (see 1906030059).

Telecom companies and healthcare providers in Alaska continued their push over the past week for changes in a rural telehealth draft report and order the FCC is scheduled to address at Thursday's commissioners' meeting (see 1907230005). In a filing to docket 17-310, USTelecom said Thursday that the rate setting mechanism described in the report and order "creates a false median rate for Alaska" because all but a small number of locations served by the state's rural healthcare providers would be grouped in the same "extremely rural" tier and receive the same median rate "regardless of whether the location is on-road, off-road or served only by satellite." It said the methodology "would effectively cut off all of the highest cost Alaska locations" from service supported by the FCC's Rural Health Care program "and severely impair the public interest by de-funding telehealth services for the neediest rural Alaskans." Alaska is unique in the nation because 82 percent of its communities are inaccessible by road, said Alaska Communications in a Thursday letter. The company asked the FCC to create a fourth rural tier, carved out of the "extremely rural" tier, for the most rural parts of Alaska that aren't accessible by road. It said the state's Commerce Department publishes a list of communities indicating which have road access and which don't, and the list could be used to help inform the program. Alaska-based GCI Communications suggests in its letter four subcategories for the "extremely rural" tier: road-system/fiber-served, off-road-system/fiber-served, off-road-system/terrestrially (non-fiber) served, and satellite-only served. Among the healthcare providers that also contacted the FCC on the draft order was Yukon-Kuskokwim Health, which recommends in a Thursday letter that the agency do in-state analysis on "the wide variations of 'rural' areas in Alaska" to examine the additional gradations of remoteness required for accuracy.

Rural ISPs are optimistic on FCC plans to distribute up to $20.4 billion over 10 years through a Rural Digital Opportunity Fund (RDOF) Chairman Ajit Pai floated earlier this year (see 1904150066). Sectors asked for modifications to a draft NPRM on rules on how to distribute the USF subsidies through a two-step reverse auction (see 1907110031). Commissioners are expected to vote at their Aug. 1 meeting on the NPRM.

Rural healthcare providers and the telecommunications companies that service them raised concerns in docket 17-310 about a draft report and order on promoting telehealth in rural America that the FCC has on its agenda for its Aug. 1 meeting (see 1907120003). Some are asking the agency to include recommended revisions before the commissioners vote, while others want to delay the vote altogether, until the September or October meeting, to give stakeholders more time to weigh in.

Competitive LECs want more time to move away from regulated resale of voice-grade copper TDM phone services bought from incumbents if commissioners vote soon to proceed with a forbearance order as expected (see 1907020058). The draft addresses remaining aspects of a larger petition for regulatory relief USTelecom filed in May 2018 (see 1805040016). The draft proposes a three-year transition for CLECs or their customers to find new voice service arrangements or for CLECs to negotiate new contracts. CLEC allies are optimistic the agency will extend the time as they seek.

Educational groups asked the FCC to reject a petition from Texas carriers to initiate a rulemaking on E-rate to favor telecom companies that provided fiber to a school or library over an overbuilder during competitive bidding for the USF program (see 1907020016), in replies posted through Wednesday in docket 13-184. "Texas Carriers paint a very different picture than most rural carriers," said Funds for Learning. "Rather than working to earn business, they ask the FCC to regulate competition away." Texas education associations said the Texas carriers should participate in competitive bidding if they want future E-rate funding, "but the petitioners, instead of proposing bids, would rather propose unnecessary rules that allow them to remain on the sidelines without consequence." E-rate Partners said "the petition limits competitive bidding instead of encouraging it." Incompas said the proposals would significantly distort the competitive bidding process, cause higher prices and delay the application process for schools trying to upgrade their broadband services. Uniti Fiber said the "requested rule changes are unnecessary, do not offer solutions, and would harm the competitive market for E-rate services by installing a thicket of bureaucratic barriers to deploying broadband." Petitioners Central Texas Telephone Cooperative, Peoples Telephone Cooperative and Totelcom Communications said they "seek to eliminate waste, not competition," and characterizations of protectionism "are patently false, unsubstantiated and misunderstand many aspects of the Petitioners' proposal." The carriers encourage a mechanism "to consider and negotiate a reasonable rate to lease existing fiber to avoid duplicative costs and unnecessary overbuilding" in ways that would benefit both USF and schools. NTCA also asked for a rulemaking to reexamine E-rate rules adopted five years ago.

Democratic FCC members voiced frustration that discussions on USF contribution revisions haven't progressed more. State officials want to see work on this, said Commissioner Jessica Rosenworcel Wednesday after the FCC meeting. She encouraged states to comment to the FCC and not wait for a rulemaking. Commissioner Geoffrey Starks, who recently joined a joint advisory board on contribution changes, said he has heard "a lot of strong voices at the state level" who are eager to see the issue vetted. Chairman Ajit Pai said, like Commissioner Mike O'Rielly, that he doesn't support including a fee on broadband access or usage in the USF contribution factor (see 1906250011). O'Rielly said there's no official timeline on a proceeding. He, like others, was answering our questions. Last month, the agency announced the USF contribution factor had grown to its highest ever (see 1906130014).