Data collected from carriers found it would cost an estimated $1.84 billion to remove and replace Huawei and ZTE equipment in their networks. In June, the FCC barred the two Chinese vendors from participating in the USF. The agency also released a list of some 50 carriers that have the equipment installed in their networks.
Oregon Public Utility Commission staff seeks comments by Tuesday on draft rules for implementing an Oregon law requiring VoIP and wireless contribution to state USF (see 2008240049), the PUC said in docket AR-640 Tuesday. The Oregon PUC aims to finalize rules by Jan. 1.
The Nebraska Public Service Commission should keep the revenue-based USF contribution for business and government services because it’s less complex than a connections-based mechanism, big telecom and cable companies said in comments received Monday and emailed to us Wednesday. The PSC is proposing to expand its connections-based method that now applies only to residential services (see 2008110047). “Business customers' connections may fluctuate” and “the applicable surcharge would need to be examined, and potentially changed on a monthly basis,” Cox Communications, Charter Communications and Time Warner Cable commented jointly in docket NUSF-119. Large business customers might relocate to a lesser taxed state due to rate shock, the cablers warned. Carriers understand revenue-based contribution; applying contributions to business and government services “will be complex, costly and confusing,” said AT&T. Complexities applying the connections method to business and government services have increased in the past three years, said CenturyLink. COVID-19 “has caused an unprecedented shift to work from home and away from business communications services which is likely to impact the analysis,” it added. Nebraska law requires revenue-based contribution for prepaid wireless services, said CTIA. A connections method for residential services stabilized and increased the fund, so "the financial threat to the NUSF viability has been overcome,” said Frontier Communications. Moving to connections for business and government lines is "impractical at this time," said Windstream. Small rural telcos countered that applying connections-based contribution for all kinds of services is fairer. “Much of rural Nebraska remains unserved or underserved," and current remittances "will come nowhere close" to providing enough support, commented the Rural Telecommunications Coalition of Nebraska. Exempt prepaid wireless, toll revenue and directory, private line and paging services, which don't lend themselves to a connections-based surcharge, said a state group of rural independent companies. Keep revenue-based at least for institutional operator service providers, urged Securus, saying it doesn’t “have the ability to determine or charge the NUSF applying a connections-based methodology" because it charges prison customers per call.
The Q4 USF contribution factor will increase from 26.5% to 27.1%, “the highest contribution factor in the history of the USF," Universal Consulting owner Billy Jack Gregg emailed stakeholders Tuesday. The numbers are based on Universal Service Administrative Co. projections of revenue at $10.428 billion, up $209 million sequentially. “Total USF revenues for 2020 will be $42.6 billion -- the lowest in the history of the USF,” said Gregg. “This represents a decline of $33.6 billion, or 44%, since revenues peaked in 2008.” Total projected USF demand for 2020 will be $345 million lower than in 2019, Gregg said. “Because of the continued decline in the USF revenue base, the average assessment factor for all of 2020 will be 23.37%, the highest average annual assessment factor ever.”
Teeing up discussion on implementing an Oregon law requiring VoIP and wireless contribution to state USF, Public Utility Commission staff Monday released draft rules in docket AR-640 to discuss at an Aug. 31 workshop. The Oregon PUC aims to finalize rules by Jan. 1 (see 2008110047).
New Mexico should raise its broadband speed standard to 25 Mbps download and 3 Mbps upload to align with the national standard, the state attorney general office replied Monday in the New Mexico Public Regulation Commission’s State Rural USF proceeding (case 19-00286-UT). New Mexico’s current standard is 4/1 Mbps. "A key consideration, particularly in the context of the ongoing Covid-19 pandemic, is that the 25/3 Mbps standard can support videoconferencing that the existing 4/1 standard cannot,” the AG office wrote. Require 25/3 Mbps with “additional language to allow a carrier that is proposing a worthwhile project which does not meet the 25/3 Mbps threshold to petition the Commission to approve of its proposed project for good cause to serve for instance, in an extremely rural area,” New Mexico PRC staff wrote in a footnote of its reply comments. CenturyLink said the broadband fund should prioritize higher speeds, without specifying numbers. Other states are also weighing USF updates (see 2008110047).
Investigate Broadband VI for getting $1 million from the Connect U.S. Virgin Islands fund without meeting qualifications to receive the USF support, Viya said in a letter to the FCC Enforcement Bureau, posted Monday in docket 18-143. “Broadband VI already has taken Stage 1 support for which it did not qualify because it did not satisfy the fundamental eligible telecommunications carrier ('ETC') obligations of offering voice service and compliant Lifeline service during the support term,” alleged Viya, saying it’s part of a larger pattern of the company disregarding commission rules. The FCC should seek reimbursement, it said. "We are aware of Viya’s filing and are preparing a vigorous response," Broadband VI Chief Operating Officer David Zumwalt emailed us. "We strongly disagree with the claims." The COO added that Viya "enjoyed many decades of high-cost support which it stands to lose as a result of Connect USVI."
An Oklahoma proposal to switch to connections-based USF contribution needs further study, state Attorney General Mike Hunter (R) told the Oklahoma Corporation Commission (OCC). The commission posted findings of fact Monday and conclusions of law received Friday in docket OSF 201900316 about the state USF administrator’s recommendation to adopt a connections-based method to stabilize the fund (see 2008110047). The plan might have merit but “lacks significant evidence in several important areas, including the outcome of such a transition in other states and the possible shift of burdens between customer types and locations,” the AG said. The proposal’s estimated funding requirement includes unsubstantiated expenses “derived from private conversations between the Administrator and representatives of telecommunications companies,” he said. “These projections include alleged expenses that are not known and measurable.” If the commission still decides to move ahead, the AG suggested "a blended methodology” where connections-based contribution would apply to only 20%-25% for the first year in a “gradual” transition. The legislature’s “oversight and involvement is necessary to adequately reform the OUSF,” he noted. A coalition including the OUSF administrator, Windstream, CenturyLink and many rural LECs urged OCC Administrative Law Judge Dustin Murer to recommend the connections-based mechanism as lawful, fair and equitable and in the public interest. CTIA disagreed, saying supporters failed to show that the connections method won't violate state or federal law, that it won't hurt poor or unemployed people, or that the state USF is unstable.
Nebraska lawmakers voted 47-0 Tuesday for a broadband infrastructure bill. LB-992 would ease deployment on existing electric easements. It would require the Nebraska Public Service Commission to establish an E-rate special construction matching fund program to support fiber installation at libraries with state USF. Profits from leasing excess capacity on dark fiber that currently go to an internet enhancement fund would go instead to state USF, with the former fund to be terminated June 30. The bill would also create a state broadband coordinator and four regional technicians to support libraries with internet and computer access. The bill goes next to Gov. Pete Ricketts (R), who didn’t comment Wednesday.
The FCC voted 4-1 to cancel a 2016 proposal to fine AT&T $106,425 for E-rate violations because the notice of apparent liability was issued after the one year statute of limitations on the violations, said an order in Wednesday’s Daily Digest (see 1608260037). The original NAL argued AT&T’s failure to charge two Florida school districts the lowest corresponding price was a continuing violation of the rules. Commissioner Jessica Rosenworcel dissented, saying she respected the procedural argument but believes there were merits to the previous FCC’s approach. The 2016 FCC’s stance that some violations should be treated as continuing would lead to more accountability for USF carriers, she said. She also said the date of violations should be pegged to USF disbursements. Commissioner Geoffrey Starks voted “concur” but raised similar concerns: “The Commission should consider how we can best promote timely detection of violations to avoid future problems with the statute of limitations.” Commissioner Mike O’Rielly said the original NAL would have failed on the merits if it hadn’t been canceled. “The previous Commission’s attempt to evade the applicable statute of limitations through its continuing violation theory was offensive to the rule of law and must be thoroughly rejected,” he said. “This NAL was dismissed because it was procedurally flawed," emailed an AT&T spokesperson. "But it was also substantively flawed, and egregiously so, as its core factual and legal claims were simply wrong.”