The FCC will tackle the next stage of making high-band spectrum available for 5G, at its June 7 meeting, Chairman Ajit Pai blogged Wednesday on the next commissioners’ "summer blockbuster" meeting. Pai also plans to look to undo leased access rules adopted in 2008 but never implemented, ease legacy telecom service discontinuances, give rural telcos broadband USF contribution relief and OK Audacy and O3b satellite plans, two intercarrier compensation items, a toll-free texting item, an IP captioned telephone service (IP CTS) order, proposals targeting telephone slamming and cramming practices and an enforcement action he couldn't discuss.
Sixty-one senators and 130 House members wrote FCC Chairman Ajit Pai Tuesday urging the commission to institute a long-term budget fix for the USF high-cost program. Temporary funding infusions are welcomed, but “persistent limitations on resources can affect the ability of smaller broadband providers to deliver services in our country’s most rural communities,” the House and Senate lawmakers said in separate identically worded letters. “The FCC’s cost model for smaller operators electing model-based USF support is not yet funded at the designed levels, and carriers not receiving model-based support will once again face significant funding cuts when the program’s new fiscal year” begins July 1. They sought action on an NPRM and establishing "lasting solutions." NTCA CEO Shirley Bloomfield said "sufficient and predictable USF support is essential to provide the business case for private sector investment and to sustain these networks."
The FCC made available illustrative USF broadband cost model results to help parties prepare comments on a recent NPRM on rate-of-return telco high-cost funding (see 1803230025). The commission sought comment on "whether to provide a new model offer based on revised parameters to carriers that would receive less support under the model than under legacy rate-of-return support mechanisms," said a Wireline Bureau public notice Friday in docket 10-90. "It also sought comment on a proposal to exclude from the rate-of-return budget constraint mechanism an amount equal to 80 percent of a carrier’s new model offer." The PN had links to the Alternative Connect America Cost Model, its methodology and reports based on that model.
An FCC order and NPRM targeting Puerto Rico and the U.S. Virgin Islands for enhanced USF support could be released in the next few days, said a commission official. Commissioner Mike O'Rielly recently said he will support the item, after receiving assurances from Puerto Rico it will end 911 fee diversion (see 1805040034). Chairman Ajit Pai's draft seeks to provide $256 million in additional USF support and repurpose another $698 million to help restore and upgrade hurricane-damaged communications networks, with $750 million for Puerto Rico and $204 million for the U.S. Virgin Islands (see 1803060039).
President Donald Trump’s tweet Sunday saying the administration is working with the Chinese government to keep Chinese equipment maker ZTE in business doesn’t offer relief for wireless carriers concerned that they may have to replace such gear if Congress or the FCC imposes a ban. “President Xi [Jinping] of China, and I, are working together to give massive Chinese phone company, ZTE, a way to get back into business, fast,” Trump tweeted. “Too many jobs in China lost. Commerce Department has been instructed to get it done!” Industry officials said concessions to ZTE likely mean the Chinese company could continue to get components from U.S. companies like Qualcomm, but don't mean U.S. carriers won't have to stop buying equipment from ZTE or Huawei.
The FCC approved Hargray Communications' proposed takeover of ComSouth from Mansfield Jennings, subject to a condition on USF support. "To prevent the transaction-specific harm of potential cost shifting, we impose a limited condition to cap high-cost universal service support based on Hargray’s operating expenses," said the unanimous order in docket 18-52. "The combined operating expense ... for Hargray’s two existing rate-of-return subsidiaries, Hargray Telephone Company and Bluffton Telephone Company, shall be capped at the averaged combined operating expense of the three calendar years preceding the transaction closing date for which the operating expense data are available." Commissioner Mike O'Rielly thanked Chairman Ajit Pai and colleagues for elevating the order from the bureau level. On substance, O'Rielly said the FCC should "remove unnecessary regulatory barriers to the voluntary consolidation of exchanges or study areas in rural America." One barrier is "a lack of clarity regarding the amount and type of federal high-cost universal service support that would be available if one kind of provider buys all or part of another provider’s service area," said his statement. "I have been pushing for the Commission to find ways to remove the 'parent trap' barrier. ... While the Commission has previously adopted rules addressing the transfer of exchanges among various categories of providers and further clarified those rules earlier this year, some categories were not addressed. Moreover, the entire structure was less than clear-cut. With this order, applicants will now have additional clarity regarding the purchase of [Alternative Connect America Cost Model] study areas." ComSouth has 3,339 local lines in Georgia and provides long-distance services.
The Wyoming Public Service Commission raised the state USF contribution factor to 1.7 percent of intrastate revenue, on an interim basis, for 12 months starting July 1, said a Tuesday public notice. The assessment rate was 1.4 percent. The commission sought comment about whether a Wyoming telecom company’s receipt of federal alternative connect America cost model (A-CAM) support should be included in the fund manager’s calculations as a contribution from federal USF. Comments are due June 6, replies June 16. The commission’s decision may necessitate adjusting the interim order, calculations used to operate Wyoming USF, and assessment and distributions to companies for the July 2018 to June 2019 fiscal year, it said.
The Regulatory Commission of Alaska sought comment on a proposed Alaska USF revamp that would sunset the revised AUSF after June 30, 2023, with a comprehensive review to begin by June 30, 2021. RCA plans a May 30 hearing and written comments are due June 15 in docket R-18-001, said a public notice and order posted Tuesday. The RCA said its proposal is based on a plan by the Alaska Telephone Association, though ATA suggested sunsetting the revised USF in 2029 (see 1802270034).
TDS Telecom is the carrier that would receive USF support under revised FCC offers of Alternative Connect America Cost Model funding, a company spokeswoman said. An FCC report listed Telephone and Data Systems as the potential recipient (see 1805080028), but that's the parent company, she said.
Rep. Gwen Moore, D-Wis., is seeking additional information from the FCC and Treasury about the FCC shifting the federal USF account to the U.S. Treasury. Changes to the program's contribution and distribution processes happened last week, drawing criticism from FCC Commissioner Jessica Rosenworcel and some House Commerce Committee Democrats (see 1804300063 and 1805030045). Lawmakers “have not seen any detailed, publicly stated explanations or documented plans indicating how the FCC and/or Treasury will ensure that these funds will remain dedicated to their intended purpose,” especially “in the event of a government shutdown,” Moore said in a draft of the letter that she intends to send to FCC Chairman Ajit Pai and Treasury Secretary Steven Mnuchin. The FCC didn't comment.