More than half the Texas House urged the Public Utility Commission to take emergency action at their Friday meeting to sustain state USF through the PUC sunset review process in 2022-23. Commissioners should consider revisiting an earlier rejected staff proposal to double the USF surcharge and broaden the contribution base to include VoIP providers, said Rep. Eddie Rodriguez (D) and 77 other House members from both parties in a letter posted Monday. “We have reached a crisis,” they wrote. “While there are multiple bills filed or currently being drafted that seek to reform and modernize the USF these cannot take effect nor the necessary rulemaking completed quickly enough to mitigate the possibility of service disruption and loss of connectivity for communities in underserved areas.” No USF item appeared on the PUC’s agenda Monday. The agency declined to comment. Facing large reductions in state USF support, rural telcos sued the PUC last month (see 2101260046).
Carriers seeking funding to replace Huawei and ZTE gear in their networks face tight restrictions as part of the process to get money from the FCC under the 2019 Secure and Trusted Communications Networks Act, Wireline Bureau Legal Adviser Justin Faulb said during a Rural Wireless Association webinar Monday. The FY 2021 appropriations and COVID-19 aid omnibus bill (HR-133) provides $1.9 billion (see 2012220061). Applicants must maintain detailed records for 10 years of all costs eligible for reimbursement, Faulb said. The FCC has 90 days to act on requests and can extend that 45 days, he said. If an application has “material defects,” companies have 15 days to correct them or must wait for a second window, Faulb said: Now the FCC is considering only one filing window, to be open for 30 days. All applications will be reviewed equally. The FCC will then analyze the level of demand and allocate funds based on individual applications, he said. If demand exceeds supply, eligible telecom carriers are first in line, with priority given for changes to the core network, he said. Once awards are announced, an applicant has a year to file the first reimbursement claim, “so you can’t sit on it and wait,” he said. Faulb advised companies to prepare now, noting that work must be completed within a year of the initial disbursement. The FCC can issue a blanket six-month extension if it finds equipment and services aren’t adequate, notifying Congress, he said. The agency can OK multiple individual six-month extensions, he said. “There’s a lot of pressure to get this done quickly and remove this insecure equipment,” he said. After the year, companies have an additional 120 days to file a claim and can seek a 120-day extension, he said. Only equipment on the FCC’s covered equipment list obtained before Aug. 14, 2018, is currently eligible for reimbursement, he said. Congress doesn't allow any equipment replaced to be used elsewhere, and companies must document that it's destroyed, he said. Recipients face audits and inspections similar to those in the rest of the USF, he said. Anyone who violates the rules can be required to pay back the funds, be barred from the USF and face legal penalties, Faulb said: “Please don’t break the rules.” The biggest question members have is when the FCC will release the public notice announcing the filing window, said RWA General Counsel Carri Bennet. “We’re working closely on it” and seeking a third-party fund administrator, Faulb said. “We’ll have to follow the government’s procure schedule, which will take some time based on just the steps we have to jump through.”
Verizon’s proposed TracFone buy is likely to be one of the first such transactions before the FCC that's now under Democratic control. The deal has raised some competitive concerns. Friday, 16 state attorneys general led by Virginia’s Mark Herring (D) asked the FCC to further investigate implications for Lifeline before approving the deal.
Schools should have more flexibility in how they use E-rate funds because most students are relying on remote learning during the pandemic, blogged Ed Gillespie, AT&T senior executive vice president-external and legislative affairs. The FCC should "evaluate whether the current E-rate structure is the right one for today's world" and work with the Education Department to transform the program, Gillespie wrote Tuesday. The funding mechanism for USF programs is "fundamentally broken and unsustainable," he said, and should be reevaluated.
Congress should provide billions of dollars in new funding for broadband, Sen. Ed Markey, D-Mass., said at a virtual FCBA conference Tuesday on the 25th anniversary of the Telecom Act. Some 42 million Americans still don’t have reliable broadband, “and that is a national tragedy,” he said. Too often, those left out are “brown, black and low-income,” he said. Markey is expected to soon be named Communications Subcommittee chairman (see 2101290049).
The USF contribution factor continues to shatter records. Universal Service Administrative Co. released its quarterly demand projections Friday, and the contribution factor will increase from 31.8% in Q1 to a historic 32.7% for Q2, said analyst Billy Jack Gregg. It raises several questions about the fund’s sustainability (see 2012310027). Even if demand stays at the current level, the factor will continue to rise because the contribution base continues to decline, Gregg said.
Rural Digital Opportunity Fund auction winners must follow through on broadband promises, NARUC Telecom Committee members said in interviews last week. NARUC plans to vote at its Feb. 4-5 and 8-11 meeting on a draft resolution urging the FCC to scrutinize RDOF long-form applications (see 2101260033). Some commissioners raised doubts about fixed wireless and said they’re unfamiliar with entities that won federal dollars.
NTIA heard complaints Thursday during a virtual “listening session” on 5G security about a lack of guidance on security threats. Much talk was on open radio access networks (ORAN), a continuing focus at the FCC (see 2012110036). The session was scheduled under the Trump administration.
Court relief probably won’t come soon enough for rural Texas telcos facing large reductions in state USF support, but it may be their last option, said telecom association leaders in interviews. The Texas Statewide Telephone Cooperative Inc. (TSTCI) and Texas Telephone Association (TTA) sued the Texas Public Utility Commission last week at Travis County District Court in Austin. About 50 small rural telcos are losing 60-70% of their Texas USF high-cost funding because commissioners refused last year to adopt a staff plan to double the contribution rate to 6.4%, they said.
AT&T “must correct and certify” by March 1 its reported broadband deployments paid for with USF Connect America Fund Phase II money, then-FCC Chairman Ajit Pai told House Homeland Security Committee Chairman Bennie Thompson, D-Miss., in a letter released Wednesday. Thompson wrote Pai in October about his “serious concerns” about AT&T “falsely claiming” after receiving $283 million in USF Connect America Fund Phase II funding “to have created new broadband service in places they have not, for people that are not receiving broadband service.” Thompson cited Mississippi Public Service Commission claims the carrier sent false information to Universal Service Administrative Co. AT&T disputes the findings (see 2010080055). The FCC is “in receipt” of the Mississippi PSC’s findings and is “reviewing this matter,” Pai said. “We must demand fiscal responsibility and accountability -- funds should be stretched as far as possible and they should be used for the sole purpose of delivering connectivity to consumers.” USAC routinely conducts random audits of carriers, and those “found in violation of Commission rules may be subject to enforcement action and forfeiture, as appropriate,” Pai said.