The FCC issued an order raising by 43 percent a USF Rural Health Care Program cap to $571 million to account for 20 years of inflation and address a funding shortfall in the face of rising demand. With the unanimous order released Monday in docket 17-310, "the FCC takes swift and long-overdue action to address this critical funding crisis," said Chairman Ajit Pai. He and Commissioner Brendan Carr said other steps would provide longer-term certainty. The agency ordered the budget cap be adjusted annually for inflation, with a process to carry forward unused funds from past funding years for future use. The order is "a first step in a much-needed process to revamp the program to ensure that it is operated in a predictable, sustainable, and accountable manner," said Commissioner Mike O'Rielly, who said "there is much more to do." He also said the order "highlights the need for an overall cap" on USF. He said the FCC should work with other agencies "to determine how our rather narrow telemedicine program works within the larger health care system." He said the FCC doesn't get credit for RHC Program benefits to other agencies. Commissioner Jessica Rosenworcel said: "While injecting more funding into the program is the right call, we need to acknowledge our actions here are no more than a short-term band-aid. If we want this program to truly thrive, it is going to require more long-term care and attention." Pai's draft order (see 1806060057) received votes of all colleagues recently (see 1806140017 and 1806190063).
The draft NTIA Reauthorization Act at first blush is a largely uncontroversial, but its future prospects and final form may depend partly on whether it gets bipartisan support, communications sector lobbyists told us. A Tuesday House Communications Subcommittee hearing on the draft may give a better sense of where Democrats stand, lawmakers and lobbyists said. The legislation would allocate NTIA $50.8 million a year for FYs 2019-2021 (see 1806200038). The hearing begins at 1:15 p.m. in 2322 Rayburn.
FCC Commissioner Jessica Rosenworcel voted for a USF rural healthcare cap hike, from $400 million to $573 million, an aide told us Tuesday. Chairman Ajit Pai's proposal to index the program for inflation, including retroactively, already received the votes of his fellow Republican commissioners (see 1806060057 and 1806140017). The draft order wasn't released.
AT&T and Verizon opposed and others supported a CenturyLink petition asking the FCC to allow local carriers and VoIP partners to collect higher end-office switching charges in certain cases even if the VoIP providers don't control last-mile facilities. Separately responding to an NPRM, rural telcos backed giving certain RLECs an option to shift their business data service offerings from rate-of-return regulation to incentive-based price caps, while AT&T and Sprint urged the FCC to ensure such price caps are set appropriately. Comments were due Monday on the CenturyLink petition in docket 01-92, and on the NPRM in docket 17-144.
T-Mobile buying Sprint is important to overall wireless industry competition and good for consumers, said their 678-page public interest statement posted by the FCC Tuesday, as expected (see 1806180044). The transaction is now formally before the FCC. The two promise the new T-Mobile will spend $40 billion to combine their networks into a “robust, nationwide world-class 5G network.” CEO John Legere blogged the new company is poised to take on cable and Dish Network, not just other wireless carriers. Early indications are the deal will face some of the same opposition at the FCC that greeted AT&T’s failed buy of T-Mobile.
The Lifeline national verifier is operational in Utah and five other “soft launch” states, the FCC announced Monday. Universal Service Administrative Co. got Federal Information Security Management Act (FISMA) accreditation Friday, said USAC Communications Director Jaymie Gustafson in a Monday interview. The reveal surprised observers, coming less than a week after the USAC official told a Utah Public Service Commission workshop the release date was unknown. Growing delay brought scrutiny from states and others (see 1806070022), as has an FCC proposal to cut Lifeline support to resellers (see 1806150048).
An FCC draft item was sent to commissioners Thursday on jurisdictional separations and referral to the federal-state joint board, said the agency's circulation list updated Friday. It's a Further NPRM, said a spokesman. The list also contains an item that circulated June 11 on promoting telehealth in rural America, which the spokesman said is Chairman Ajit Pai's draft order to hike a USF Rural Health Care Program spending cap. It has majority support (see 1806140017).
FCC Chairman Ajit Pai defended the agency's Lifeline USF actions and proposals to lawmakers who voiced concern about their ramifications for the low-income subsidy program. "I am committed to bridging the digital divide, and, like you, I believe the Lifeline program can help do just that," he wrote, responding to Sen. Cory Booker, D-N.J., and four colleagues in an exchange posted Friday in docket 18-5. He said a November order "seeks to focus Lifeline support where it is most needed and incentivize investment in networks that enable 21st century connectivity for all America" (see 1711160021). But he's also "committed to ensuring that the Commission fulfills its obligation to be a responsible steward" of USF by strengthening Lifeline's "efficacy and integrity by reducing the waste, fraud and abuse that has run rampant in this program for the better part of a decade." An accompanying NPRM "sought comment" on various "measures to improve" program administration, "from re-empowering state commissions to police Lifeline carriers to partnering with states to stand up the National Verifier, from improving program audits to adopting a self-enforcing budget." He sent the same response to Sen. Michael Bennet, D-Colo., (here), and similar responses to Sens. Susan Collins, R-Maine, and Robert Casey, R-Pa., (here) and Rep. Mike Thompson, D-Calif., (here). "I agree with you that the National Verifier will be one important tool in eliminating this waste, fraud, and abuse. But it is not the only one, nor will it solve all the problems with the program. It simply isn't prudent to sit idly by when hundreds of millions of taxpayer dollars are at stake," he told the last three. Pai also defended, in a response to Sen. Heidi Heitkamp, D-N.D., (here) the FCC's Lifeline tribal changes, which he said will spur broadband investment while preserving basic support for low-income Native Americans.
Groups that typically would be expected to rally behind FCC nominee Geoffrey Starks have remained mostly quiet in the weeks since President Donald Trump sent the nomination to the Senate (see 1806010072 and 1806040067). That appears to reflect concerns the groups cited soon after Starks emerged in March (see 1803090040) as the likely nominee: with almost no track record and little else to go on, self-described public interest groups and others are reluctant to say too much about the nomination. Starks’ lack of a record is widely viewed as one of his selling points and an important reason the Senate is likely to easily confirm him, communications lawyers and others told us. The Senate Commerce Committee set Starks' confirmation hearing for Wednesday in what's perceived to be a bid to fast-track approval (see 1806120047 and 1806130096).
Aureon Network Services urged the FCC to ensure viability of centralized equal access (CEA) service in any intercarrier compensation rules flowing from last week's NPRM (see 1806060010). Aureon (Iowa Network Services) said its CEA fiber network concentrates traffic of more than 200 rural telcos at an interconnection point in Des Moines, helping RLECs compete with "former monopoly services" of AT&T and CenturyLink in delivering broadband and cable TV. "The NPRM proposes new rules that would remove a substantial volume of traffic from the CEA network," Aureon said on discussions with aides to Chairman Ajit Pai and Commissioner Jessica Rosenworcel, posted Wednesday in docket 18-155. "Aureon may need to charge a per minute CEA tariff rate above the CLEC rate benchmark being investigated in WC Docket No. 18-60 to offset such a large decrease in traffic volume." Staff is probing Aureon access charge tariff revisions -- challenged by AT&T and Sprint -- to comply with a November order that partially granted an AT&T complaint alleging improper CEA charges on traffic heading to CLECs engaged in access stimulation (see 1804200054). "As traffic volume decreases, the per minute CEA rate must increase in order to recover the same fixed network costs," Aureon's filing said. "CEA service does not have end users from which Aureon can recover the costs of providing CEA service, and Aureon does not receive USF or [Connect America Fund] support for CEA service."