Ore. PUC Presses to Finish State USF Distribution Update
The Oregon Public Utility Commission faces “a really tight deadline” to update state USF rules, said the Nicola Peterson, PUC senior telecom analyst, at a virtual workshop Thursday. There and in written comments earlier this week, telecom industry groups gave mixed reviews of the PUC’s plan to adopt a CostQuest model to determine the size of the Oregon USF (OUSF) starting Jan. 1.
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Temporary OUSF rules expire at the end of June. To get new rules extending the existing method for the rest of 2022, Oregon commissioners would need to vote at an April 19 meeting to open a formal rulemaking, said Peterson: Staff plans to release a draft as soon as Monday. The formal proceeding would be announced in May’s Oregon Bulletin, allowing the PUC to adopt rules at a June 1 meeting, she said. The PUC would need to report disbursement amounts for 2023, using the CostQuest model, by Oct. 31, Peterson said.
The Oregon Telecom Association “is very concerned about an approach that adopts a rule to use a model without knowing how that model works or the result it produces,” the wireline association wrote in docket AR 649. There at least must be agreement on what inputs and algorithms will be used, or it might be better to use actual costs to determine OUSF size, OTA said.
It’s a “chicken or the egg” problem, said Peterson. “The thing is, we’re not going to have access to the model until we buy it, and we don’t want to buy it until we agree that we’re going to use it.” OTA attorney Rick Finnigan replied, “I don’t want to agree that we’re going to use it until we see what it is.” Davis Wright’s Mark Trinchero, representing the Oregon Cable Telecommunications Association (OCTA), agreed adopting a rule before getting to try the model could be problematic, but he later said he understood the desire to get rules in place and it might be OK if it’s possible to revise rules later.
Peterson pledged more technical workshops once the model is purchased to work out details of using it. They would occur during an expected 90-day implementation process, she said. OUSF Program Manager Roger White said a deal with CostQuest could be finalized in two weeks if no more issues arise.
OCTA supports staff’s proposed framework, "especially the rules requiring that the CostQuest model be used to determine the cost of providing basic service and for determining the total required support amounts for all support areas, and to use the model to conduct annual updates,” said its written comments: But more clarity is needed on how the model will be used to set benchmarks and subtract federal support. Also, OCTA doesn’t think support should go to “any census blocks with at least one unsubsidized wireline or wireless provider of voice services similar in functionality to basic telephone service."
Unsubsidized competition is a complex issue that likely can’t be addressed in this docket, said Peterson at the workshop. OCTA has been raising the issue for a while and another punt is disappointing, replied Trinchero: Markets could be distorted and the fund could expand beyond what’s necessary.
Make OUSF distribution competitively neutral and consider federal broadband funding when determining OUSF size, wrote CTIA. "The same companies that are eligible for OUSF funding also will be eligible for significant amounts of funding made available in the federal Infrastructure Investment and Jobs Act,” but unlike OUSF, “federal funding will not impact the surcharges on Oregon communications ratepayers’ bills.”
OUSF is meant to help companies’ maintain carrier-of-last-resort obligations for voice, and federal funding will target only certain areas, responded Lumen Director-Government Affairs Tre Hendricks at the workshop. “It will help in some degree. Where and how, we don't know.” Federal funds are for building infrastructure, while OUSF pays for operating existing facilities, agreed Ziply Fiber Vice President-Regulatory and External Affairs Jessica Epley.
The California Public Utilities Commission sought comments Wednesday on a proposed edit to its access line definition for state USF. It would now mean “a wire, radio frequency, other medium of transmission, or protocol used to provide telecommunications service or [VoIP] service to or from any device utilized by an end-user, regardless of technology, which is associated with a wireline, wireless, VoIP or other service account assigned a 10-digit number or other unique identifier and has a California billing address or registered location in California,” wrote Administrative Law Judge Hazlyn Fortune. Comments are due April 29 in docket R.21-03-002.
The Oklahoma Corporation Commission plans to discuss possible statutory changes to Oklahoma USF at an April 26 virtual meeting, the agency emailed stakeholders Wednesday. Staff posted a draft bill and policy paper March 14 (see 2203140056). Regulatory Commission of Alaska staff heard industry concerns about possible state USF changes March 18 (see 2203180066).