Federal Universal Service Fund

Carriers shouldn’t get reimbursed by the Universal Service Fund Link-Up fund for activation charges that the carrier waives or reduces when customers buy extra airtime, said TracFone Wireless in a Dec. 1 petition for declaratory ruling. At least one eligible telecommunications carrier, ReachOut Wireless, is doing that, TracFone said. Also in the petition, TracFone asked the FCC to declare that a carrier receiving Link-Up money for wireline services may not use the money for wireless unless it first gets FCC approval. And TracFone wants the FCC to declare that a carrier must use “some of its own facilities” to be designated as an ETC in a particular state. The FCC should clarify that a carrier can’t cite wireline facilities to meet that requirement if it’s providing wireless services, “unless those wireline facilities are being used to transmit or route the wireless services that are designated for support.” TracFone’s proposed rules “are necessary to ensure that disbursements from the federal USF are only received by properly-designated ETCs and are only used to support services as allowed by the Commission’s rules,” TracFone said.

FCC Chairman Julius Genachowski formally announced Wednesday that he'll bring a net neutrality order to a vote at the Dec. 21 meeting. The draft had been expected for several days. Genachowski and his staff said they have broad support from industry, public interest and other stakeholders. Senior officials said privately that they had secured no commitments not to challenge the proposed rules in court. Nonetheless, the chances of being sued by a major ISP are much lower if the commission doesn’t reclassify broadband and instead proceeds with net neutrality sticking with its Title 1 authority, industry executives and lawyers said.

ATLANTA -- The Rural Utilities Service will help the FCC carry out the National Broadband Plan, revamp the Universal Service Fund and accomplish other goals, Administrator Jonathan Adelstein said Tuesday at the National Association of Regulatory Utility Commissioners conference.

ATLANTA -- The FCC is “moving forward strongly on implementation of the National Broadband Plan,” including fixing the spectrum, intercarrier compensation and Universal Service Fund systems, said FCC Chairman Julius Genachowski, speaking at a NARUC annual meeting for the first time. Two areas in which innovation is essential are broadband and the smart grid, said Commerce Secretary Gary Locke. NTIA has identified government spectrum for commercial broadband, he said. (See separate story in this issue.)

The FCC’s order Friday that requires nomadic VoIP providers to pay into state Universal Service Funds and federal USF could lead to more regulatory activities in some states, officials said in interviews. The order (CD Nov 8 p2) had been expected since September, when Kansas and Nebraska amended their petition to the FCC by deleting language that would have allowed states to assess fees retroactively.

African-Americans and Hispanics are still less likely to use broadband Internet in their homes even when they attain the same education and income levels as whites, a government report said. Nearly 87 percent of urban and nearly 76 percent of rural, college-educated white families used broadband in their homes in 2009. But for black families with the same education, the percentages were about 77 percent in cities and 56 percent in the countryside; for college-educated Hispanics, the percentages were almost 78 percent in cities and about 69 percent in the country, the Commerce Department said in a report released Monday.

Nomadic VoIP providers will have to pay into state Universal Service funds as well as the federal USF, the FCC ruled Friday. In a 5-0 declaratory ruling published late Friday, the commission ruled in favor of a request by the Kansas and Nebraska utilities commissions. That would let states assess USF fees on nomadic VoIP.

A GOP wave claimed longtime telecom heavyweight Rep. Rick Boucher, D-Va., and other Democrats in rural states, as Republicans seized control of the House Tuesday. The Republicans also won seats in the Senate, but the Democrats maintained power there. The GOP gain is seen as bad news for net neutrality supporters, while the loss of House Communications Subcommittee Chairman Boucher is a setback for rural telcos who supported his efforts to overhaul the Universal Service Fund.

FCC Chairman Julius Genachowski faces tough oversight from the new Congress starting in January, after Republicans picked up as many as 70 seats in the House Tuesday. That was more than the 55-seat swing that gave Republicans control of the House in 1994. But it’s unclear whether Genachowski will face the kind of Commerce Committee investigation Kevin Martin faced when Republicans lost control of the House four years ago (CD Sept 14 p1). The Republican takeover of the House also could have a long-lasting effect on FCC policy, particularly Genachowski proposals on net neutrality and broadband reclassification. Genachowski was an adviser to former Chairman Reed Hundt when Democrats lost control of both the House and Senate in 1994.

Lack of clarity on VoIP at the federal level opens the door to additional state activity, state officials told us. Regulators in states like Wisconsin are looking at VoIP issues, including authority over the technology. The Wisconsin Public Service Commission had a prehearing Tuesday and will look into the appropriate level of regulation on VoIP. A decision is expected in July.