Human judgment is necessary in executing the FCC’s quantile regression analysis, since it “is currently and likely always will be inaccurate to such an extent,” said a white paper from Alexicon Consulting and Balhoff & Williams, filed with the FCC Thursday (http://bit.ly/Zv4j8K). The analysis determines telcos’ high-cost support and was implemented as part of the FCC’s November 2011 USF order. The report’s two authors are listed as Alexicon Principal Vincent Wiemer and Michael Balhoff, an attorney with Balhoff & Williams.
Federal Universal Service Fund
The FCC's Universal Service Fund (USF) was created by the Telecommunications Act of 1996 to fund programs designed to provide universal telecommunications access to all U.S. citizens. All telecommunications providers are required to contribute a percentage of their end-user revenues to the Fund, which the FCC allocates for four core programs: 1. Connect America Fund, which subsidizes telecom providers for the increased costs of offering services to customers in rural and remote areas 2. Lifeline, which directly subsidizes low-income households to help pay for the cost of phone and internet service 3. Rural Health Care, which subsidizes health care providers to offer broadband telehealth services that can connect rural patients and providers with specialists located farther away 4. E-Rate, which subsidizes rural and low-income schools and libraries for internet and telecommunications costs The Universal Service Administrative Company (USAC) administers the USF on behalf of the FCC, but requires Congressional approval for its actions. Many states also operate their own universal service funds, which operate independently from the federal program.
House Communications Subcommittee Chairman Greg Walden, R-Ore., said he hopes the FCC’s open Internet order falls when the U.S. Court of Appeals for the D.C. Circuit rules on the FCC’s authority to impose the regulations, he said at the NARUC conference Tuesday. If they do, Walden said he will block any legislative efforts to reinstate the rules. “Let me be clear, not on my watch,” he said.
NARUC will tackle spectrum sharing, emergency communications coordination and the FCC’s “repeated abuses of informal rulemaking,” according to draft resolutions released this week (http://xrl.us/bob6pm). State regulators will consider the resolutions at their winter meeting in Washington in February. The proposed resolutions delve into past controversial territory, such as addressing FCC referral to the Federal-State Joint Boards on Separations and Universal Service. USTelecom objected to joint board referral provisions at the past two NARUC meetings, in Baltimore in November (CD Nov 14 p5) and Portland, Ore., last July (CD July 25 p8), although both of the resolutions passed.
Major changes in the U.S. telecom marketplace in the 15 years since passage of the 1996 Telecom Act highlight the need for reforms to that legislation, said Free State Foundation President Randolph May Wednesday during an event. The pro-deregulation think tank was promoting its new book, Communications Law and Policy in the Digital Age, which focuses on how U.S. telecom law and policy should change over the next five years. Reforms should reflect changes to the marketplace since 1996 -- the switch from analog to digital, the switch from narrow-band to broadband networks and the switch from a mostly monopolistic marketplace to one that’s highly competitive, May said. “Those changes call for a new communications law, and certainly, absent waiting for the new law, changes in the direction of communications policy,” he said.
Don’t doubt the success of the federal government’s wide-ranging broadband stimulus launched two years ago, program officials said. NTIA Administrator Larry Strickling gathered representatives from four of its 224 Broadband Technology Opportunities Program grantees at the Brookings Institution Wednesday to discuss different projects’ virtues, lessons learned and as Strickling said, “to demonstrate the successes” and “humanize” the $4-billion stimulus investment with “tangible” details of how the different projects work. The message glossed over past concerns, such as overbuilding (CD Sept 27 p6), accountability (CD Nov 15 p15) and, in the past year, partial suspension of eight of the program’s largest infrastructure grantees -- seven in May due to FirstNet compatibility concerns (CD Aug 7 p1) and one in December (CD Dec 10 p6) due to compliance problems. The event coincided with NTIA’s 15th quarterly BTOP update to Congress (http://xrl.us/boa3z2).
Thousands of census blocks are incorrectly identified as “unserved” by the National Broadband Map (NBM), said cable companies and wireless Internet service providers (WISPs) in comments in FCC docket 10-90 (http://xrl.us/bn99cn). But USTelecom, the Independent Telecommunications and Telephone Alliance (ITTA) and individual ILECs said the map incorrectly overstates the areas listed as served. The map is used to determine where Connect America Fund Phase I money can be distributed. Price-cap carriers get access to the money to help fund broadband buildout in areas the map lists as unserved.
State telecommunications associations in New York and Maine oppose Time Warner Cable’s Nov. 13 FCC petition seeking limited ETC classification and Lifeline participation, they told the FCC in filings posted this week. Time Warner Cable (TWC) wants to be categorized as an eligible telecom carrier for limited purposes of receiving Lifeline funds but hopes to avoid any redefinition of its service areas and doesn’t want other USF support. “Forbearance [of certain FCC rules associated with ETCs] would enable TWC to introduce a competitive alternative that better responds to the particular needs of low-income consumers,” it said in its petition (http://xrl.us/bn8w5e). The Wireline Bureau opened the petition for comment in a Nov. 30 notice (http://xrl.us/bn8wzg), with comments due Monday and reply comments due Jan. 14.
The FCC had no jurisdiction to change intercarrier compensation rates to zero in its 2011 USF/intercarrier compensation order, and it violated the 10th Amendment by treating states as administrative agents of the federal government. That’s the main argument of the state members of the Federal-State Joint Board on Universal Service, who submitted a 9,000-word amicus brief this week recounting what they called the FCC’s violation of dual-sovereignty; its “convoluted” and over-expansive interpretation of Section 251(b)(5) of the Telecom Act; and its reliance on “11th hour ex parte communications” without adequate notice, in violation of the Administrative Procedure Act. The 10th U.S. Circuit Court of Appeals had asked for 810 words.
The November 2011 FCC USF order cost a rural Texas telco more than $500,000 in support, the company said. Hill Country Telephone Cooperative asked the Texas Public Utilities Commission for money from the state’s USF this fall to make up for the loss. “I've been in telecom for 34 years, and I find these days the most challenging of my career,” Hill Country General Manager Delbert Wilson told us. “This whole [FCC] transformation order has filled our industry with chaos and uncertainty."
BALTIMORE -- State regulators are confronting an increasingly tortured relationship with the FCC, creating a task force to address it Monday at the NARUC meeting. It consists of seven commissioners and is already official and active. Meanwhile, two NARUC resolutions directly address the fractured FCC relationship, as was expected (CD Nov 2 p12), and NARUC adopted both resolutions as policy Tuesday after they advanced through the telecom subcommittee and committee. One urges FCC referral to the Federal-State Joint Board on Universal Service as well as to the Federal-State Joint Board on Jurisdictional Separations on major decisions, and another addresses a pending Supreme Court case on the Chevron doctrine, looking at the risk of federal overreach of authority.