Correction: The party affiliation of Iowa Gov. Terry Branstad is Republican (see 1509010058).

The 4Q USF contribution rate for carriers will drop to 16.7 percent (from 17.1 percent) of interstate and international telecom revenue, said industry consultant Billy Jack Gregg in his quarterly update Tuesday. Despite projections by Universal Service Administrative Co. that the interstate/international telecom revenue base will decline from $15.046 billion to $15 billion in 4Q, the contribution factor is expected to dip because the previously announced USF demand for the quarter also declined from $2.17 billion to $2.12 billion, said Gregg of Universal Consulting.

Library and consumer groups said they plan to support the FCC net neutrality order, which is being challenged in the U.S. Court of Appeals for the D.C. Circuit (the case is USTelecom vs. FCC, No. 15-1063). A major Internet group previously said it would back the order. The American Library Association, Association of College and Research Libraries, Association of Research Libraries and the Chief Officers of State Library Agencies filed a motion Tuesday asking the D.C. Circuit for leave to file an amicus brief in support of the Department of Justice and FCC as they defend the order, which also reclassified broadband Internet access service under Title II of the Communications Act. The groups said their brief would argue the net neutrality rules are needed to protect the interests of libraries and their users. "Without rules banning paid prioritization, libraries would be significantly hampered in efforts to provide the most vulnerable populations with access to content and services on the Internet, including educational resources and non-profit content," they said. The groups also plan to argue the that FCC general Internet conduct standard was an appropriate tool under the Communications Act to ensure the Internet remained "open" and "a democratic platform for research, learning and the sharing of the information" in the face of "future harms that cannot yet be defined." Consumers Union filed a notice Tuesday of its intent to file a brief supporting the DOJ/FCC. The group said all the parties to the case had consented to its participation. The Internet Association -- representing Amazon, eBay, Facebook, Google, Netflix, Yahoo and other prominent Web companies -- filed a similar notice Aug. 7. The DOJ/FCC brief is due Sept. 14 and the supporting intervenor and amicus briefs Sept. 21. Cable/telco petitioners challenging the order filed their briefs in July (see 1507310042) and intervenors and amicus briefs supporting their challenge were filed in August (see 1508070058).

No new filings were posted to the FCC Electronic Comment Filing System Tuesday, though the planned outage associated with the agency's IT upgrades (see 1508200049) was still a day away. Many of the filings showed up Wednesday, and an FCC spokesman told us the lack of postings was related to the upgrade plans. “In preparing the hardware for the upgrade, a connection to a server was temporarily lost,” the spokesman said. No information was lost, and ECFS was restored to working order by Wednesday afternoon, the spokesman said. The outage and upgrade were on schedule to begin at 6 p.m. Wednesday, the spokesman said.

The FCC approved Frontier Communications's planned buy of Verizon wireline systems in California, Florida and Texas, in an order released Wednesday by the International, Wireless and Wireline bureaus in docket 15-44. The order found that the transaction was "unlikely to result in any significant public interest harms" and it did not attach conditions. The deal also needed state regulatory approval, including in California.

Judge Richard Leon of U.S. District Court in the District of Columbia rejected requests from the Justice Department to delay a hearing in Klayman v. Obama on the “unconstitutional collection” of telephonic metadata by the NSA, a Freedom Watch news release said Tuesday. After Friday's U.S. Court of Appeals for the D.C. Circuit decision sending the case back to Leon, citing lack of evidence the plaintiffs’ Fourth Amendment rights were violated (see 1508310042), he scheduled a hearing for Wednesday at noon. “It is thus clear that the court intends to move this case along to get to the bottom of the unconstitutional surveillance, and to move it to trial as soon as possible,” Freedom Watch said. Founder and plaintiff Larry Klayman said he was pleased Leon is “moving quickly to address the continued Orwellian illegal surveillance of all Americans.” Klayman said Leon previously referred to the case as the “pinnacle of national importance” and said he hopes the judge will “implement a procedure to allow us to quickly seek and obtain justice.”

The FCC’s Daily Digest email won’t go out during the outage period caused by the IT upgrades starting Wednesday evening, and the commission doesn’t plan to release any official documents during that period (see 1508200049), the FCC said in an email sent to Digest subscribers Tuesday afternoon. The Digest will be “paused” starting Thursday or Friday, and is expected to resume Sept. 8. The IT upgrades and accompanying outage are expected to begin Wednesday at 6 p.m. “Distribution of the Daily Digest will resume when the systems are available again,” the email said. Though the FCC doesn’t plan to release any official documents during the outage, it will have “a mechanism” for releasing hard copy documents “should there be a pressing need,” the email said. “Any such releases that would ordinarily appear in the Daily Digest will be included in the Daily Digest when it is next issued.”

Changes made to the National Security Letter (NSL) statute are often overlooked in discussion about the impact of the USA Freedom Act and reforms to the intelligence community, wrote Electronic Frontier Foundation Executive Director Cindy Cohn and Deputy Executive Director Kurt Opsahl in a blog post Monday. “USA Freedom did not fix the problem of overbroad, potentially eternal gag orders, or the fact that the NSL statute relegates the court to little more than a rubber stamp,” Cohn and Opsahl wrote. In a ruling made public last week, the 9th U.S. Circuit Court of Appeals in San Francisco used the minimal changes as “cause for another delay in considering the constitutionality of NSLs in two” EFF cases, they said. Gag orders will continue to prevent EFF’s clients from “participating fully in the debate around USA Freedom” and the debate on national security surveillance in general, Cohn and Opsahl said. “While we’re extremely disappointed, we will continue to push forward to get the gags lifted, allow our heroic clients to speak freely, and seek to have the NSL statute declared unconstitutional.”

The FCC email system won’t be affected by the IT upgrade and associated outage, but Internet access at commission headquarters may be unavailable at times during the six-day period starting Wednesday evening (see 1508200049), an FCC spokesman told us Monday. “Employees at Gettysburg, at FCC’s field locations, or employees who telework will continue to access email with no change,” he said. The phones at the commission will work, but voicemail won’t, the spokesman emailed. “Every Bureau and Office main phone line will be staffed during business hours to assist the general public or practitioners.”

Verizon "walked away" from about $570 million in broadband support in eight states, the Communications Workers of America said in a release Thursday. The telco that day conditionally accepted $48.6 million of $143.9 million in subsidies it was offered for each of the years 2015-2020 under the FCC Connect America Fund Phase II program (see 1508270068). “Verizon’s track record is clear,” said Bob Master, assistant to the vice president of CWA District One. “Even while raking in a billion dollars per month in profits, Verizon is turning its back on underserved communities by refusing federal subsidies to expand high-speed internet access. Instead, its top priority is slashing job and retirement security for its employees and eliminating benefits for workers injured on the job.” The CWA and Verizon are in a labor contract dispute (see 1507310059). A Verizon spokesman emailed in response: "CWA leadership once again is choosing to distract from the real task at hand: serious negotiations on a fair contract for its members. The fact is Verizon continues to invest billions and to deploy broadband across the states and communities in question, and we will meet all of our deployment commitments." Verizon conditionally accepted the CAF support in two states as expected (see 1508240035), California and Texas, where (along with Florida) it's selling its systems to Frontier Communications. But CWA noted Verizon declined support to provide 10/1 Mbps broadband to 270,000 locations in Delaware, Massachusetts, Maryland, New Jersey, New York, Pennsylvania, Rhode Island, Virginia and Washington, D.C.