Broadband infrastructure legislation has strong prospects, with the 2018 election conducive to passage, said NTCA CEO Shirley Bloomfield in an interview for C-SPAN's The Communicators to be televised soon (here). Recognizing that securing additional rural USF support from the FCC is difficult, she said she remains hopeful and believes broadband infrastructure legislation could help fill the funding need. She said the broadband net neutrality dispute gives lawmakers a hook to pursue a Communications Act rewrite but it's a heavy lift.
FCC staff denied Critical Alert Systems' request to review an audit decision by the Universal Service Administrative Co. that said CAS didn't accurately report certain revenue on its 2009 Form 499-A filing. USAC said CAS didn't provide "sufficient documentation or any other information to support the allocation of its interstate paging revenues for universal service contribution purposes," said a Wireline Bureau order Monday in docket 06-122. CAS, formerly NEP, reported interstate telecom revenue well below a "safe harbor percentage" exempting paging providers from making USF contributions, but a USAC audit determined in 2012 the company didn't provide enough support for its revenue claims, and the bureau upheld that decision. A CAS spokesman said the company recently sold its paging assets to American Messaging Services. We couldn't reach AMS for comment.
FCC Chairman Ajit Pai announced a Rural Broadband Auctions Task Force to spearhead implementation of two planned reverse auctions of USF subsidies that were the subject of orders adopted Feb. 23 (see 1702230019 and 1702230042). The Connect America Fund Phase II (CAF II) auction will offer almost $2 billion in support for fixed broadband providers to connect customers, and the Mobility Fund II (MF-II) auction will offer $4.5 billion to expand 4G LTE mobile coverage -- both over 10 years -- said a commission release Monday. Pai named from within the agency Chelsea Fallon task force director, and Michael Janson and Kirk Burgee deputy directors. Thom Parisi will be chief of staff of the task force, which will draw on senior staffers from across the commission. The FCC is moving "aggressively to close the digital divide" and the task force "will help ensure that taxpayer funds are allocated efficiently for rural broadband deployment and that all Americans who want Internet access are able to get it," said Pai. Beginning the auctions "as soon as possible is a top priority," he added.
Universal Service Administrative Co. in 2016 focused on protecting USF integrity, streamlining and optimizing program operations, supporting stakeholders "through better online tools," and employing data "to improve operational effectiveness," said CEO Chris Henderson in USAC's annual report posted Thursday in FCC docket 96-45. "These initiatives became all the more important with the FCC’s new and ongoing modernization orders for Lifeline, High Cost, and Schools and Libraries. While Rural Health Care didn’t have a formal modernization order from the FCC, 2016 was a transformative year as we implemented changes to accommodate a growth in demand for funds. The ground work we laid to prepare for these program shifts was a stabilizing force in a year of enormous change, and has helped us execute a volume of work unparalleled at USAC."
FCC staff denied requests for review of Universal Service Administrative Co. audit findings of USF contribution filings but remanded the cases to USAC for further consideration of some issues. The findings involve "whether certain revenues associated with specific mixed-use special access lines (also referred to as private lines) should be considered interstate" in assessing USF contributions, said a Wireline Bureau order in docket 96-45 in Friday's Daily Digest. Carrier USF contributions are based on their interstate and international telecom end-user revenue. The review requests were filed by DeltaCom, McLeod USA Telecommunications Services, PacTec Communications, Puerto Rico Telephone, US Link and XO Communications. The facts varied, but each party said USAC misapplied a "ten percent rule" in the audits of their USF contribution filings, the order said. The rule assigns "mixed-use private or WATS" line costs as intrastate if 10 percent or less of a line's total traffic is interstate. "USAC appropriately relied on the ten percent rule to determine the jurisdictional nature of the revenues," the bureau wrote. "USAC may have failed to consider other relevant evidence that particular private lines were properly classified as intrastate. We therefore remand the requests for review to USAC for further consideration consistent with this Order."
Commissioner Mignon Clyburn lauded an FCC broadband health mapping platform as "a monumental step" that's building knowledge and awareness about the importance of advanced health services. Calling it "simply unacceptable" that 34 million Americans lack access to 25 Mbps connectivity and others can't afford it, she said the initiative is helping identify areas with "critical need" for broadband health solutions. "It is designed to assist those committed to closing infrastructure gaps, to ensure that everyone has access to the technology necessary, and enable quick and top-rated health care assistance," she said, according to prepared remarks Thursday at a state telehealth summit in Columbia, South Carolina: The interactive tool "will enable those in both the public and private sectors to access and analyze statistics about broadband connectivity, as well as health and other indexes on a national, state, and county level." Clyburn said the tool overlays broadband data with key health information down to the county level. "Using this data, the FCC also has been able to identify, what we call the 100 'critical need' counties, meaning those communities with limited broadband access and very high health needs," she said, noting the initiative was launched by a Connect2Health task force in August (see 1608020017). She said requests for the USF Healthcare Connect Fund, which has an annual budget of $400 million, "reached a historic high of nearly $378 million" in funding year 2015, the most recent available.
FCC Chairman Ajit Pai is dubbing April “infrastructure month” and two infrastructure items top a busy tentative agenda for the April 20 commissioners’ meeting. Separate NPRMs are to examine how the FCC can further expedite the deployment of both wireless and wireline infrastructure, as expected (see 1703290049). The April agenda focuses on Pai’s “digital empowerment agenda,” his biggest theme so far (see 1701230058). States meanwhile are working on wireless siting issues (see 1703300054).
Lifeline advocates knocked FCC Chairman Ajit Pai's plans to roll back the agency's process for designating Lifeline broadband providers (LBPs), which he said usurped state authority. Senior House Democrats blasted the decision and Commissioner Mignon Clyburn voiced disappointment. Some said Pai wasn't living up to his rhetoric to close the "digital divide," but others praised him, including a key Republican senator. Although Commissioner Mike O'Rielly didn't comment, he previously said he didn't believe the FCC could bypass state authority to designate USF-eligible telecom carriers (ETCs) for Lifeline. Pai announced he would begin a proceeding to scrap the LBP process and said he didn't believe staff in the meantime should approve pending LBP applications (see 1703290025).
Telecom providers criticized a Nebraska proposal to change the state USF contribution formula from one based on revenue to a connections-based mechanism using phone numbers. In February, the Public Service Commission proposed a $1.29 surcharge for mobile voice, $1.24 for residential fixed voice and a five-tiered scheme for assessing charges to business lines. The current revenue-based contribution factor is 6.95 percent. But in testimony Friday released this week in docket NUSF-100, business line providers including Cox, Frontier and Windstream said the scheme for business lines isn't clear and may be tough to manage. For business lines, it’s not clear what revenue is to be considered in determining the surcharge -- only the business tariff rate or also extended-area-service fees and long-distance charges, Windstream said. Long-distance charges can fluctuate widely month to month, and business bundles could further complicate assessment, it said. Frontier said its billing system can't segregate or sort business customers into the five proposed tiers. Level 3 said assessing based on the number of phone numbers could hurt enterprise and government customers that have many phone numbers. CenturyLink said the business tiers are hazy and distinguishing between mobile and fixed lines for USF fees isn't equitable. CTIA said assessing different fees to mobile and fixed lines is “unreasonably discriminatory.” In other testimony, Communications Director Cullen Robbins proposed three alternative plans for contribution fees: (1) set mobile and residential voice surcharges equal at $1.29 and use two categories for businesses, single-line and multiline; (2) charge mobile and fixed the same fee and have one charge for business lines; and (3) use two categories for business -- single line and multitiered -- and treat residential fixed voice as a single-line business. "Continued declines in Nebraska Universal Service Fund (NUSF) remittances as a result of the erosion of the assessable base has led to a need to revise the contribution mechanism for the NUSF," Robbins said. A connections-based system is "more stable and predictable than the current mechanism,” he said. Some wireline companies supported the principle of assessing USF fees by connection as bringing more stability to USF. "A connection-based mechanism should be less volatile than a revenue-based mechanism, and … it should be less vulnerable to erosion of the contribution base," Windstream said. But Charter said it would be better to keep the status quo. "Moving away from this system will be complex, costly, confusing, and will likely need to be duplicated if the FCC ultimately changes the federal system,” it said. "Continuing with a revenue-based system is the most efficient, the most trusted, the most enforced and most enforceable, system yet devised. As [Winston] Churchill said: 'Democracy is the worst form of government, except for all the others.' The same can be said for revenue-based contribution systems -- at least at this time.”
Rep. Bill Johnson, R-Ohio, will be the “go-to guy” leading broadband infrastructure efforts for the House Commerce Committee and “therefore, for the Republican conference,” House Communications Subcommittee Chairman Marsha Blackburn, R-Tenn., said Tuesday before a gathering of NTCA members. “This is a guy you’re going to see a lot as we focus on broadband expansion.”