The National Exchange Carrier Association proposed a modified formula to calculate USF "high-cost loop expense adjustments for average schedule companies" covering the second half of 2016. The proposal includes a reduction in the authorized rate of return for rural carriers from 11.25 percent to 11 percent, said a NECA filing Friday in docket 05-337. The 25 basis points drop is the first in a six-year phasedown to 9.75 percent adopted by the FCC in its March 30 order overhauling rate-of-return USF mechanisms (see 1603300065).

The FCC teed up Onvoy's planned buy of ANPI Business and ANPI, LLC from ANPI Holdings under a streamlined pleading cycle, with initial comments due May 27 and replies June 3, said a public notice in docket 16-144 listed in Monday's Daily Digest. Onvoy provides or is authorized to provide CLEC and/or interexchange service in most of the U.S., while ANPI Business and ANPI, LLC provide interexchange service throughout the country and provide or are authorized to provide CLEC service in various states, the PN said.

The FCC Enforcement Bureau admonished Veza Telecom for "failing to comply" with an FCC subpoena to produce information and documents for a slamming and cramming investigation. "VEZA's failure to respond properly to a Commission order exhibits contempt for the Commission’s authority and threatens to compromise the Commission’s ability to investigate violations of law," said a bureau order Monday. "In light of VEZA’s claim that it is no longer in business and that it has surrendered its International Section 214 authorization, however, we take this step of admonishing VEZA rather than imposing a forfeiture." Veza could not be reached for comment.

An FCC draft item that circulated last week would address six RLEC requests for waivers of intercarrier compensation provisions affecting cost recovery under the 2011 USF/ICC Transformation Order, a commission spokesman told us. The spokesman said Monday the rate-of-return rural ILEC requests came from (1) Emery Telcom, (2) IAMO Telephone Co., (3) Laurel Highland Telephone Co. and Yukon-Waltz Telephone Co., (4) Smart City Telecom, (5) West Kentucky and Tennessee Telecommunications Cooperative and (6) Yukon-Waltz Telephone Co. The waiver petitions target Section 51.917 of the commission's rules, according to the item on the FCC circulation list, which was updated Friday.

The FCC teed up AT&T's bid to obtain phone numbers for interconnected VoIP service directly from numbering administrators. Comments are due May 27, said a public notice in docket 16-135 listed in Friday's Daily Digest.

The FCC should approve a Windstream petition to ensure ILEC DS1 and DS3 loops are available to competitors as discounted unbundled network elements (UNEs) even if fiber replaces copper (see 1603150065), CCMI consultant Andrew Regitsky said in a blog post Friday. Clearer DS1 and DS3 UNE rights would not only give Windstream and other CLECs lower wholesale prices in some cases but also more leverage in broader special access negotiations, Regitsky told us by phone (DS1s and DS3s provide traditional special access service). The FCC so far "has chosen to sit on" the Windstream petition," Regitsky's blog post said, despite a recent Further NPRM to revamp the special access framework for business data service, or BDS (see 1604280057 and 1605030001). "The agency is currently in the process of developing new regulations for the [BDS] market, including the classification of markets into competitive or non-competitive to create new rules for special access and Ethernet services," he wrote. "But how can it determine if a market is competitive if the market participants have no idea what service alternatives are available? It is high time for the Commission to act on this issue and end the continued uncertainty for both ILECs and CLECs." CLECs generally supported the FCC's regulatory course in the FNPRM while most large ILECs were critical. Although Regitsky previously worked for CLEC trade group Comptel (now Incompas), he recently slammed FCC BDS proposals as "Bizarro world" regulation (see 1605060057).

NTCA pressed the FCC for "sufficient" budgets to carry out its overhaul of rate-of-return USF high-cost mechanisms through a new voluntary model-based approach and updated legacy support of stand-alone broadband. The FCC raised its $2 billion annual budget to $2.15 billion to cover possible increased support based on a broadband cost model, and also instituted new controls of capital and operating expenditures and lowered the authorized rate of return, leading NCTA to seek further budget flexibility (see 1603300065 and 1604180055). In a Thursday filing in docket 10-90 about a call with Wireline Bureau Deputy Chief Carol Mattey, NTCA backed "equitable sharing of budget resources and fair application of budget controls" among all rural carriers, with each RLEC responsible for the consequences of its model decision "rather than having the risk and consequences" spread to all carriers. "To the extent that the Commission does not adopt such a clear-cut approach to model elections, NTCA suggested two alternatives that could be used in ensuring equitable management of the budget among all RLECs," it said, providing numerous details of its proposals in an attachment. In an earlier filing about a call with Mattey and other bureau officials, WTA asked how certain aspects of the model-based selection process would work and also voiced concerns that some options would reduce the overall budget for all carriers sticking with the updated legacy mechanisms. Also, NTCA, in a letter discussing the "challenge process" for model-based support, said the FCC shouldn't overlook "clear evidence in the record indicating that certain Form 477 data are simply inaccurate or imprecise in measuring the presence of competition." Rural incumbents facing certain levels of unsubsidized competition aren't eligible for the new support, but many RLECs are challenging the Form 477 data of competitors (see 1604280011).

The FCC sought comment by May 26 on discontinuance applications filed by AT&T, Cardinal Broadband and Level 3. The applications seek to discontinue, reduce or impair domestic telecom services and/or interconnected VoIP service, said a Wireline Bureau public notice Wednesday in dockets 16-151, 16-152 and 16-153.

Frontier Florida is now the complainant against Florida Power & Light in a pole attachment dispute (see 1603140049), the FCC Enforcement Bureau confirmed in a letter posted Tuesday in docket 15-73. Frontier Florida took over from Verizon Florida after Verizon Communications completed its sale of wireless systems in Florida and two other states to Frontier Communications.

AT&T and the National Exchange Carriers Association took issue with a Sandwich Isles Communications (SIC) restructuring plan to reduce the amount of disputed cost recovery it needs from a NECA pooling mechanism to pay for its Paniolo undersea cable network in the Hawaii Islands (see 1604290035). "SIC claims that it has somehow restructured the Paniolo lease and that as a reward it now should be allowed 100% recovery of these restructured lease payments. SIC’s post-hoc justifications should be rejected," AT&T said in its reply comments in an FCC proceeding in docket 09-133 to refresh the record. NECA also wasn't convinced by Sandwich Isles' recent plan. "SIC’s proposal is unclear, has not actually been implemented, and does not take into account the substantial additional costs associated with the Paniolo cable system that are part of the 'lease expenses subject to dispute,'" the group said in its reply. "Even the proposed revised lease cost of $8.1 million for the Paniolo cable system is unsupported either as to cost or demand. SIC’s alleged 'comparable' cost analysis is not submitted for evaluation. SIC has failed to meet its burden of justifying its inclusion of the lease expenses in its revenue requirements. Therefore, NECA’s conclusion that the Paniolo cable system lease cost is not used and useful is still valid, even at the lower level." The FCC should resolve the open issues based on "existing and verifiable facts," NECA said. In its reply, SIC said NECA's previous funding resistance is "now moot" due to its recent proposal. "The refinancing proposal SIC has advanced in its Initial Comments -- a proposal that NECA has publicly stated, although not on the record in this docket -- that it will 'consider' is a complete response to the set of issues that NECA has raised," Sandwich Isles said. "Given NECA’s record of unwillingness to accept a valid Bureau Order specifying the level of recovery, we are constrained to answer the NECA arguments on their own terms. We submit that the position it has taken is wholly without foundation, with respect to both the facts and legal analysis."