The Wireless ISP Association urged the FCC to exempt small ISPs from any USF charges that may be imposed on broadband. Imposing new costs and burdens on unsubsidized broadband providers “will make broadband less affordable for customers, including many in those areas most in need of access services,” WISPA said in a letter to the commission posted Tuesday in docket 96-45.
A petition for U.S. Supreme Court review of the 10th U.S. Circuit Court of Appeals denial of petitions to review the 2011 USF/intercarrier compensation (see 1405270045) order should be denied, the FCC said in a brief filed with the high court. U.S. Cellular, Cellular South and the Rural Independent Competitive Alliance said the FCC lacked authority to require broadband buildout in order to receive USF, but none of the petitioners has standing to challenge the requirement, the agency said. The petitioners’ argument rests on the classification of broadband as an information service, but “the FCC has now reversed that classification,” the brief said. The appeals court also correctly said the agency was authorized to impose the broadband requirement even when broadband was classified as an information service, the agency said.
Industry groups are upset over an FCC policy statement creating what they call “draconian” treble damages for amounts owed to USF and other funds. CTIA, Comptel, NCTA and USTelecom filed petitions for reconsideration and a stay, saying the statement violates notice requirements and the “inflexible” triple damages violates the Communications Act. ITTA filed comments supporting the joint petitions.
The FCC should cap the overall size of USF programs to protect consumers after the agency announced March 13 an increase in the program’s contribution factor to 17.4 percent for the second quarter of 2015, Free State Foundation's Seth Cooper said in a blog post Monday. The contribution factor is up from 16.8 percent. “Reducing USF surcharges should go hand-in-hand with comprehensive reforms that reduce the overall size of the USF subsidy system and improve its efficiency,” he wrote. Wireless customers are hit hardest by USF increases, he said, saying the agency considers 37.1 percent of a wireless consumer's calling plan as interstate long distance and subject to the USF surcharge. Given the commission’s authorization of an E-rate increase of $1.5 billion annually, “it's hard to expect voice consumers will avoid even heavier USF surcharge burdens in the future,” Cooper wrote.
The FCC is aware “our story is not done” on its municipal broadband pre-emption order, given Tennessee Attorney General Herbert Slatery’s legal challenge to the order, said Daniel Kahn, Wireline Bureau Deputy Competition Policy Division Chief, during a commission webinar Monday. Slatery, a Republican, sued the FCC March 20 in the 6th U.S. Court of Appeals over the order, which pre-empted municipal broadband restrictions in North Carolina and Tennessee at the respective requests of Wilson, North Carolina, and the Electric Power Board (EPB) of Chattanooga (see 1503240059). North Carolina Attorney General Roy Cooper, a Democrat, is considering whether to join Slatery’s lawsuit, a spokeswoman said. The FCC webinar also addressed the commission’s new NPRM on implementation of Section 111 of the Satellite Television Extension and Localism Act (STELA) Reauthorization and implementation of the FCC’s net neutrality order.
Rep. Alex Mooney, R-W.Va., introduced legislation Thursday that would “exempt providers of broadband Internet access service from Federal universal service contributions,” said the text for HR-1712. The two-page bill is called the Freedom From Internet Tax Act, said a copy provided by Mooney’s spokesman. “Overzealous government bureaucrats should keep their hands off the internet,” Mooney told us in a statement Friday. “The President has proposed the internet be treated like a utility with the potential for fees, the cost of which would be passed on to users. Since its inception the internet has been a free and open tool for all to use and enjoy without interference from Washington. It should stay free and it should not be taxed.” The bill was referred to the Commerce Committee. Mooney isn't on Commerce. The bill has no co-sponsors. A concern at several oversight hearings this month involved broadband service becoming subject to such USF fees, which some connected with the FCC reclassification of broadband as a Communications Act Title II telecom service. Mooney’s legislation text provides a straightforward exemption for broadband providers, citing the FCC Feb. 26 net neutrality order for definitions of what constitutes such service.
Release of the FCC net neutrality order brought limited clarity to how the rules and the commission’s accompanying reclassification of broadband as a Communications Act Title II service will affect state telecom regulation, state telecom lawyers and observers said in interviews last week. That lack of clarity largely stems from continued uncertainty about whether the net neutrality rules -- and particularly Title II reclassification -- will survive legal scrutiny, lawyers said. Alamo Broadband and USTelecom filed lawsuits Monday seeking reviews of the net neutrality order at the 5th U.S. Circuit Court of Appeals and the U.S. Court of Appeals for the D.C. Circuit, respectively (see 1503230066). The order faces continued scrutiny on Capitol Hill (see 1503200048).
Comments are due April 24, replies May 11 on The Compliance Group’s Jan. 27 petition for a declaratory ruling to clarify the exemption for systems integrators from USF contribution obligations, said an FCC Wireline Bureau public notice Tuesday. It said Compliance wants a clarification on whether the exemption applies to the resale or provision of interconnected VoIP when resold or provisioned by a systems integrator.
The House Republican Study Committee (RSC) embraced the net neutrality vision of House Commerce Committee Vice Chairwoman Marsha Blackburn, R-Tenn. The committee, representing a conservative caucus within the GOP, released a 110-page Blueprint for a Balanced Budget document this week, saying “Congress should repeal the [FCC]’s February 26, 2015 rule reclassifying broadband Internet access as a telecommunication service under Title II of the Communications Act,” basing the idea explicitly on Blackburn’s Internet Freedom Act (HR-1212). House Republican Study Committee Chairman Bill Flores, R-Texas, is an original co-sponsor among HR-1212’s 43 GOP backers. The RSC budget proposal for FY 2016 also would repeal the USF, suggesting a Congressional Budget Office-predicted savings of $96 billion over the coming decade: “Unfortunately, the programs run by the fund -- including the LifeLine program that provides free government-subsidized cell phones -- are too often fraught with waste, fraud, and abuse.” The Lifeline program doesn't give away free cellphones. The RSC proposal also calls for passage of the Permanent Internet Tax Freedom Act and for a reduction of government competition with the private sector, slamming the Obama administration “encouraging local governments to offer broadband Internet service, overriding state laws through regulation and offering incentives in the tax code.” Flores and RSC Budget and Spending Task Force Chairman Marlin Stutzman, R-Ind., claimed credit for the proposal, which they say will balance the budget in six years. Republicans and Democrats on the House Budget Committee are considering warring proposals. Telecom issues also arose last week during a markup session that cleared the House Budget Committee’s GOP proposal. Rep. Donald Norcross, D-N.J., had offered an amendment backed by several other Democrats that would have supported infrastructure investment. It would have found that “the federal government has played a critical role in the development of America’s infrastructure,” including “telephone networks” and “the development of the Internet” and would have included the sense that Congress should “work to ensure that Americans enjoy increased access to high-speed broadband internet services.” It failed in a 14-21 party-line vote.
Net neutrality dominated FCC Chairman Tom Wheeler’s fourth hearing in under two weeks Tuesday, as he faced off against a House GOP appropriator expressing the desire to punish the agency financially for its focus on net neutrality. Wheeler said that the FCC FY 2016 budget request of $388 million largely developed from “unavoidable costs” such as the agency’s proposed move. Commissioner Ajit Pai, as expected (see 1503230067), opposed the budget request and asked Congress to defund the net neutrality order’s execution.