The 5th Circuit U.S. Court of Appeals "erroneously upheld the USF revenue-raising mechanism" in its ruling against Consumers' Research petition on the FCC's Q1 2022 contribution factor, the group told the 11th Circuit (see 2303240049). The group challenged the Q4 2022 factor in the 11th Circuit. The court "never addressed" the group's argument about the nondelegation doctrine's intelligible principle "in the context of revenue-raising," Consumers' Research said in a letter posted Monday (docket 22-13315). The group also said the court "found no private nondelegation violation despite the FCC never bothering to issue a separate approval of [the Universal Service Administrative Co.'s] quarterly proposal and having only 'a small window' for review."
The Utah Public Service Commission should think twice about repealing its extended area service (EAS) rules, commenters said last week. The PSC sought comment last month on scrapping its rule 347 (see 2302220040). The Utah Rural Telecom Association isn’t sure what the PSC “is attempting to achieve” with the possible repeal, the industry group said in docket 23-R347-01. "The EAS Rule was established over 20 years ago as a means for companies to establish unlimited local calling for an extended area (between exchanges in communities of interest) for a flat fee,” and “continues to be relevant today.” Eliminating EAS could affect providers' revenue and state USF, the association said. Customer EAS revenue offset some rural telcos' costs, "likely reducing the ILECs' draws from” Utah USF (UUSF). "Requiring a provider to provide unlimited local calling between all of its exchanges without any EAS rate element would decrease toll revenues which could ... increase a provider’s reliance on the UUSF." The group added, “While some aspects of the EAS rule may be outdated when viewed from the lens of modern digital switches, URTA believes that the EAS Rule is workable as it is enacted and should not be eliminated so long as there remain tariffed EAS services.” The Utah Commerce Department’s Division of Public Utilities said it doesn’t “feel that Rule 347 should be repealed but does feel that the rule needs to be updated to match changes that have occurred in the telecom industry over the last 20 years.” The Utah Office of Consumer Services (OCS) doesn’t have enough information to know the impact of repealing the EAS rule, it said. "However, given the substantial uncertainties … coupled with the fact that the rule as written does not currently create difficulties in Utah telecom regulation, the OCS notes that the best approach may be to leave the rule intact.” If the PSC wants to move forward, OCS suggested holding a technical conference or allowing discovery to get more information.
The 5th U.S. Circuit Court of Appeals denied Consumers' Research's challenge of the FCC's method for funding the USF under the nondelegation doctrine, in a ruling Friday (see 2212060070). The FCC "has not violated the private nondelegation doctrine because it wholly subordinates" the Universal Service Administrative Co., the court said, noting Congress "supplied the FCC with intelligible principles when it tasked the agency with overseeing" USF.
The FCC Wireline Bureau dismissed and denied SES Government Solutions' petition for reconsideration of a 2017 order clarifying that the USF's government-only exemption applied only to contractors "providing service directly and exclusively to government and public safety entities and does not apply to subcontractors," in an order on reconsideration Wednesday in docket 06-122. Expanding the exemption "would defeat the narrow purpose of the exemption and be detrimental to the stability of the fund," the order said.
The Arizona Corporation Commission will wait to change or repeal state USF, said a 5-0 decision released Thursday in docket T-00000A-20-0336. Staff recommended last month waiting for a Frontier Communications rate case coming Aug. 30 (see 2302070057).
Senate Commerce Committee ranking member Ted Cruz, R-Texas, and Communications Subcommittee ranking member John Thune, R-S.D., pressed the FCC Thursday for a detailed accounting of its distribution of money to four broadband programs enacted via the Infrastructure Investment and Jobs Act and COVID-19 aid measures. Senate Armed Services Committee ranking member Roger Wicker, R-Miss., and Senate Communications Subcommittee Chairman Ben Ray Lujan, D-N.M., meanwhile, led refiling of the Funding Affordable Internet with Reliable (Fair) Contributions Act.
The administrative law judge process at the FCC is “completely broken” and “something you would find in a banana republic,” not the U.S., former FCC Commissioner Mike O’Rielly said during a Georgetown Center for Business and Public Policy webinar Wednesday. O’Rielly noted review by an ALJ was recently “activated” as part of the review of the Standard/Tegna deal (see 2303100082.)
Inmate calling services providers and consumer advocacy organizations welcomed a draft NPRM and order the FCC will consider during the commissioners' open meeting Thursday that would begin implementation of the Martha Wright-Reed Just and Reasonable Communications Act of 2022. Advocates sought some clarifying language in the final item, and ICS providers sought additional language in the draft on how the agency should establish just and reasonable rates.
The USF contribution factor has “gone up really through the roof” and “led to a pretty vibrant debate right now about what the future of the universal service is going to be funded going forward,” said Keller and Heckman partner Casey Lide during a firm webinar Thursday. The telecom lawyer noted some groups sought direct congressional appropriations to fund USF, while others urged the FCC to include broadband internet access service revenue in the contribution base. Consumers’ Research’s challenge of the USF contribution factor in the 5th U.S. Circuit Court of Appeals based on the nondelegation doctrine could “force the hand on this kind of reform discussion,” he said (see 2301180054). If the court finds in favor of the petitioners, “it's undoubtedly going to go before the Supreme Court,” Lide said: "This Supreme Court could well uphold that [and] if that happens, then you're in a scenario where the universal service program is effectively gutted by judicial process.”
FCC commissioners emphasized the need for action on spectrum policy and 5G, and more certainty on broadband affordability and deployment efforts, during Incompas’ policy summit Tuesday. Some industry experts also urged changes to sustain the USF because funding for the affordable connectivity program remains uncertain and the USF contribution factor continues to rise.