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Progress Seen at NARUC as Lifeline Resolution Clears Committee, FCC Joint Boards Meet

NARUC's Telecom Committee unanimously cleared an amended Lifeline resolution urging the FCC and Universal Service Administrative Co. ensure the national verifier accesses state databases required to automatically check users are eligible. USAC is responding to concerns and committed to making the NV work, South Dakota Commissioner Chris Nelson told us after the vote.

Some subscribers may be kicked out of the program due to snafus, industry lawyers told us. USAC representatives meanwhile acknowledged much of the concern from stakeholders raised earlier at the conference (see 1902110003). They said they're working on fixes.

Nelson, state chair of the Federal-State Joint Board on Universal Service, and other chairs for USF and separations joint boards gave positive assessments of the federal-state groups' Monday closed-door meetings. That's according to attendees.

Nelson and USAC “had a very good visit [Tuesday] morning about some things that they think they can do that will start to move in the right direction to solve the immediate problem of the reverification and also the longer term issue of actually creating a system that will ping the necessary databases,” said the commissioner. On a Sunday panel, he raised concerns to a USAC official (see 1902110003). “They fully now understand the problem we’re dealing with,” he told us now.

Thousands of eligible low-income people are in danger of losing Lifeline subsidies, said resolution sponsor and Nebraska Commissioner Crystal Rhoades at Tuesday’s Telecom Committee business meeting. It’s wrong not to access databases in state where it’s not cost effective, said Nelson: “Truly make this a national verifier.”

Nelson had some reservations about the resolution asking to reverse a policy of not accepting Medicaid and Supplemental Nutrition Assistance Program cards that don’t include participation dates. Users submit photocopies of their cards if they fail the automated process, but many cards don’t have dates. The cards are “almost begging to be misused,” said Nelson, but without the NV automatically accessing SNAP and Medicaid databases, it’s tough to avoid accepting the cards, he said. The committee cleared a substitute amendment by Nelson that raises the cards issue for FCC consideration but doesn’t specifically ask the agency to permit continued use of the cards. Addressing the database problem would moot the cards problem, said Rhoades.

USAC Listening

USAC representatives told state commissioners the organization, which administers Lifeline for the FCC under the agency's policies, has heard their criticisms and is learning from them.

They said USAC may link up its Lifeline NV to databases covering Medicaid recipients this year, in addition to the current NV linkup with the Department of Housing and Urban Development. That expansion could cover about 60 percent of those eligible for the telecom services for the poor, versus some 35 percent of Lifeline users who now use Medicaid to show they should receive the service. So said speakers including USAC Vice President-Lifeline Michelle Garber.

"We’ve learned a lot the past few days" at the conference "about what we can be doing to better administer the program," Garber said earlier on the panel. "There’s been a lot of national verifier talk the last few days."

USAC and the FCC "have been talking quite a bit about that and even meeting with carriers to get feedback on potential solutions" for a potential NV application programming interface to further automate enrollee verification, Garber said. Any API or such steps would be while "protecting the integrity of the national verifier system" in the 24 states where it's now being used, half on a permanent basis and the others in soft launch, she added. FCC rules require a nationwide NV by year's end, NARUC heard.

There may be no silver bullet to address all concerns, and coordination with other agencies takes time, USAC reps said. "There’s not a perfectly automated system that we'll be working towards here" for unified eligibility checks, Garber said. Needed details are in a "number of different databases," she said. "There is not a single place that we can point the national verifier to, to determine eligibility."

The administrator seeks a “seamless experience” for customers, said Senior Adviser Jessica Zufolo. "We don't want to wait for NARUC meetings to hear concerns ... frustrations" and the like, she said later. "We are very close to getting an agreement" with the Centers for Medicare & Medicaid Services on NV data. The partial federal shutdown gave "us a little bit of a setback" in efforts to sync more data, Zufolo said. "There’s a lot of people in the federal service who are trying to share data" to help, she said. "It takes time, and agencies don’t always have the resources, like the staff."


Lifeline provider attorneys said de-enrollments have begun. That's despite USAC's assertion it's not de-enrolling subscribers who aren't reverified by the NV (see 1902110003).

"Deenrollments mandated by the NV reverification process have happened," emailed Kelley Drye's John Heitmann. "I also understand that USAC gave a 60-day extension in one isolated circumstance." He told us by phone that when subscribers can't be reverified electronically, further reverification is required, and carriers can do it or ask USAC to do it. He's unaware of any subscribers being de-enrolled under the USAC process but said providers unable to reverify subscribers themselves have de-enrolled customers due to regulatory requirements and deadlines. If USAC doesn't believe providers should do that, it should clearly tell them, he said.

Carriers might be de-enrolling subscribers, but they don't have to yet, said a USAC spokesperson. She said the NV reverification process in initial states is ongoing and even carriers who choose to do it on their own need to submit documentation to USAC. If, at the end of the process, USAC finds that a subscriber can't be reverified, then it will make that final determination and direct providers to de-enroll customers, she said.

CTIA's committed to supporting solutions to ensure the NV's success. It discussed opportunities for an API to enable efficient verification and safeguard program integrity, said a filing on meeting FCC Wireline Bureau staffers. It was posted Tuesday in docket 17-287.

Joint Boards

USF and Separations Joint boards met Monday after a long dry spell. Earlier that day, the FCC appointed two new state commissioners nominated by NARUC: Minnesota Commissioner Dan Lipschultz and Colorado Commissioner John Gavan (see 1902110004).

We’re definitely at a better spot than we had been,” said Nelson, who earlier complained about lack of federal response to state members’ proposal on USF contribution. The USF Joint Board will meet “much more frequently,” with the next meeting at NARUC’s summer conference July 21-24 in Indianapolis, “and hopefully working together to find a resolution” to revamping USF contribution, Nelson said. The group hadn’t met for a year and a half, so Nelson was “grateful” to meet Monday, he said. Federal members Geoffrey Starks and Brendan Carr could stay only for the separations board meeting, but staff was present at the later USF joint board meeting, Nelson said. Their offices didn't comment.

It was a positive meeting,” Separations Joint Board State Chair Sarah Hofmann told us after the board’s meeting Monday: “We’re starting up on our work again.” Commissioner Mike O’Rielly, federal chair of both boards, afterward said only that it was “a spirited conversation.”

O'Rielly has said USF contributions targeting broadband are a nonstarter, and for the joint board to function, state members must recognize that limitation. O'Rielly says he's open to other ways of shoring up an eroding industry telecom revenue base, but he's more focused on bringing fiscal discipline to USF, including through a proposal for an overall budget (see 1802060028). On separations, the FCC recently extended by up to six years the Part 36 rule freeze on telco category relationships and federal-state cost-allocation factors. It also tasked the joint board nearer term with focusing on amending rules to recognize they target only rate-of-return carriers and to see if other rules or record-keeping duties can be pared back (see 1812170049).

USF contribution politics "remains very tricky," emailed New Street Research analyst Blair Levin. "The best prospect is in the three months between a presidential election and an inauguration." He said when then-FCC Chairman Kevin Martin tried to overhaul the system in 2008, he couldn't get the votes. "Contribution reform historically has been a politically impossible task because broadening the contribution base means someone who is not paying anything currently will end up paying something," emailed Cooley's Robert McDowell, an FCC commissioner in 2008. "That creates a perfect storm to create a coalition against reform.”

"Hope springs eternal,” emailed telecom consultant Carol Mattey. "Perhaps it's time for all concerned to focus on the art of the possible, rather remaining at an impasse."

Reaching Rural

There's an "infrastructure crisis in our rural areas,” Mississippi Public Service Commission Chairman Brandon Presley said on a Tuesday panel. “Not to beat up” on incumbent providers, he said, but policymakers must think outside the box to spread broadband. It’s not a question of having adequate Netflix, Presley said. It's “whether you're going to have a community to save."

Policymakers should decide at the national level that broadband is a utility and the goal should be universal service, said Elin Swanson Katz, National Association of State Utility Consumer Advocates president. Incumbents don’t have a business case in every area, so other answers must be found, she said, adding that the homework gap is real in the her home state of Connecticut. Kids would go to McDonald’s to do homework, but the fast-food restaurant limited access; they worked outside high schools, but that was shut down due to security concerns; they can go to library, but that closes at 6 p.m., she said.

Utilities are deploying broadband because they see it as “life blood” for their communities and “no one else will,” said Utilities Technology Council General Counsel Brett Kilbourne. BARC Electric Cooperative “saw the writing on the wall,” CEO Mike Keyser said: Customer growth was declining and fiber-to-the-home was a way to keep people in its community. The “bigger risk” was not doing anything, he said. Incumbent CenturyLink made it difficult to build the physical network in BARC’s part of Virginia, he said: “They don’t want to serve our customers but they don’t want us to serve them either.”

Presley’s state, Mississippi, recently enacted a law allowing rural electric cooperatives to provide the service (see 1901300026). It’s “anti-America” not to allow electric cooperatives, owned by citizens, to use infrastructure for broadband, he said. Katz supported municipal broadband, saying it’s government’s “basic” job to provide services that no one else will provide. Presley supports muni broadband, but Mississippi didn’t include it in the bill because any kind of government control would have been a “death knell” to the proposal, he said.

NTCA members were first to deploy in rural areas where big companies didn’t go, said Senior Vice President-Policy Mike Romano. A balance must be struck between reaching unserved areas and maintaining connections in already-served areas, he said. It’s not up to industry to decide muni broadband policy, but public-private partnerships are a good way to ensure a network’s success, he said.

Presley said 5G hype is “hogwash,” since some of his communities don’t have 3G. Communities can’t wait for 5G, and it’s a “red herring” because it will need fiber infrastructure regardless of the technology direction, said Katz. Electric utility fiber could pave the way for 5G services in a community, said Kilbourne.