States should be able to shift to connections-based USF contribution to stabilize funds, said the state chair of the Federal-State Joint Board on Universal Service Thursday after CTIA filed its second lawsuit against states making that change. CTIA sued the Utah Public Service Commission Tuesday for its Jan. 1 shift to connections-based contribution, arguing the 36-cent fee violates federal Lifeline requirements and illegally discriminates against prepaid wireless services. CTIA urged the U.S. District Court in Salt Lake City to decide federal law pre-empts the Utah rule and to stop the state commission from enforcing it.
The Rural Utilities Service should coordinate with the FCC on disbursing $600 million for broadband deployment under the recently enacted Consolidated Appropriations Act, blogged FCC Commissioner Mike O'Rielly Wednesday. The Department of Agriculture agency is to administer the pilot program of grants and loans. "The new program could be instrumental to filling coverage gaps in rural America not yet addressed by private companies and the FCC’s USF programs -- but only if it is implemented in a thoughtful and coordinated manner," he wrote. He lauded statutory language intended to target the funding to areas without 10/1 Mbps service and prevent overbuilding. "It is imperative that RUS coordinate with the FCC to ensure the implementation of regulations prevent any overbuilding of USF funding recipients," he said. "By working in a complementary fashion, these programs can help providers extend and sustain broadband into the most rural parts of the nation. For instance, the FCC has lacked the funding and resources to complete its Remote Areas Fund (RAF) proceeding, which was intended to bring service to the hardest to reach portions of the United States. If the RUS pilot program can reach into these RAF or RAF-like areas, then the country will be much closer to achieving the objectives of universal service." He said it's also important for the FCC to understand how the RUS money is being spent and for both agencies to work with the NTIA "on data on current and future broadband funding commitments so that the broadband map developed pursuant to this legislation provides the most accurate information possible regarding any remaining unserved areas."
Dissents from the two FCC Democrats appear unlikely when commissioners vote Tuesday on an NPRM proposing to bar use of money in any USF program to buy equipment or services from companies that “pose a national security threat” to U.S. communications networks or the communications supply chain. Mignon Clyburn and Jessica Rosenworcel appear unlikely to dissent, despite concerns raised by small carriers, industry and agency officials said.
Nokia said the FCC shouldn’t be swayed by early criticisms of a draft NPRM that would prevent using money in any USF program to buy equipment or services from companies that “pose a national security threat” to U.S. communications networks or the communications supply chain. The NPRM is set for a vote at the April 17 commissioners’ meeting (see 1804090045). “There are parties that are promoting a narrative that the Commission is seeking to cast a wide net, to indiscriminately bar vendors that have a presence in, or manufacture in, certain geographies, such as China,” said a filing posted Tuesday in docket 18-89. “Essentially all” big technology and communications companies source some components in China, the Finnish equipment maker said. “Those who are against the Commission’s proposed action to secure our Nation’s infrastructure are using the fact that many companies share common countries of origin in their supply chains as a basis to suggest the draft order would therefore have sweeping effect and greatly limit equipment supplier options for carriers seeking USF support.” But the draft seems clear that’s not the case, Nokia said. “The Commission’s approach has less to do with country of origin as a basis of risk assessment and more to do with supplier trustworthiness.” The company said as rules are finalized, the agency should “make clear that identifying a company as a prohibited provider is an extraordinary act that the Commission expects would be used sparingly, and based on a review that takes into account the totality of the circumstances.” It said Monday that China Mobile had picked it to supply equipment for a regional optical transport network the Chinese carrier is building as part of its push toward 5G.
CTIA warned Alaska commissioners not to adopt connections-based contribution for state USF. The Regulatory Commission of Alaska (RCA) is weighing whether to repeal or revamp its state fund (see 1804040039). CTIA earlier challenged Nebraska and Utah commission decisions to adopt connections, including a pending lawsuit against the Nebraska Public Service Commission where the association’s brief is due May 18 (see 1801310054). A connections-based approach is “difficult to implement in a manner that doesn't violate federal law,” said CTIA Counsel-External and State Affairs Matt DeTura Monday during a teleconferenced RCA workshop. It may also increase financial burden on low-income consumers and business customers, he said. CTIA supports funding state USF with general tax revenue, he said. Officials for Alaska Communications and the Alaska Attorney General Regulatory Affairs and Public Advocacy office supported connections-based contribution. AT&T General Attorney Cindy Manheim said Alaska USF is unsustainable but urged more time to discuss the right way forward. She suggested the RCA talk to the legislature before proceeding with a connections-based approach. The Alaska Telephone Association’s plan (see 1802270034) offers short-term stability while providing time to work out longer-term changes including what to do about contribution, said ATA Executive Director Christine O’Connor. Commissioner Robert Pickett said connections-based contribution may be unrealistic. And a 10-year sunset of the fund proposed by ATA may be too long, Pickett said. The AUSF size could be “rather de minimus” a decade from now at its current 10 percent annual rate of decline, he said.
FCC Chairman Ajit Pai added a local official to the Broadband Deployment Advisory Committee after two local resignations from the body and continuing criticism of BDAC's composition. Pai appointed David Young, a National League of Cities member and fiber infrastructure and right-of-way manager in Lincoln, Nebraska, the FCC announced Monday. Young replaces Sam Liccardo, mayor of San Jose, California. BDAC Chair Elizabeth Bowles and other BDAC officials said last week they hoped Pai would appoint new local members to the group (see 1804040044).
The Competitive Carriers Association, NTCA and the Rural Wireless Association raised questions about an NPRM set for a vote at the April 17 commissioners’ meeting proposing to bar use of money in any USF program to buy equipment or services from companies that “pose a national security threat” to U.S. communications networks or the communications supply chain. But that hasn’t translated into ex parte meetings at the FCC. RWA raised concerns Monday in a filing in new docket 18-89. China experts said concerns are legitimate.
The Nebraska Public Service Commission seeks four members for its state USF advisory board, the PSC said Friday: one to represent telecom carriers, one for rural healthcare and two for the public. Those appointed to the nine-member board may serve two consecutive three-year terms. The agency is moving to connections-based USF contribution despite industry resistance (see 1801310054).
The Retail Industry Leaders Association objected to FCC Lifeline USF proposals that would "weaken" the program and reduce or eliminate "availability to thousands -- perhaps millions -- of low income families." A "proposal to categorically exclude wireless resellers from Lifeline would be especially problematic," RILA filed Wednesday in docket 17-287. "Removal of those providers from the Lifeline program would leave low-income households with no available wireless Lifeline options." It also criticized a possible FCC budget cap that would deny services to qualifying households and a proposal to require low-income participant co-pays. The group said its 200-plus members have $1.5 trillion in annual sales and many are vendors of wireless services for major carriers. The FCC didn't comment Friday.
Tribal telco representatives praised FCC targeted USF relief, but one voiced concern about a left-out carrier, and the others said further steps are needed. The agency Thursday voted, with Chairman Ajit Pai partially concurring and Democratic commissioners partially dissenting, for relaxed operating-expense restrictions on rate-of-return telcos primarily serving tribal lands, attaching broadband conditions to target the extra funding (see 1804050028). It's "significant for the providers and the communities they serve," emailed Patrick Halley, Wilkinson Barker counsel to Saddleback Communications, one of five carriers staff expects to be covered. "While more can certainly be done to address the Tribal broadband deployment gap, Chairman Pai and the Commission are to be commended for recognizing the higher costs incurred in maintaining and deploying broadband networks on Tribal lands," he said. "We are pleased the commission recognized the need of some of the tribes," said Randy Tyree of GRTyree Consulting, who represents the National Tribal Telecommunications Association and Mescalero Apache Telecom. "We're very concerned about Mescalero Apache not being able to receive relief just because they built out their broadband further than the others. Without this relief, Mescalero is certainly going to have to look at other alternatives" for funding. Mescalero wants "to remain constructive and see what" it can do with the agency, he added. Gila River Telecommunications, another carrier expected to receive relief, is pleased the FCC "has finally adopted this order that will ensure USF support better reflects the cost of providing service on tribal lands," emailed counsel Gregory Guice of Akin Gump, who also lauded Pai's work and lawmaker attention. "We do, however, agree with the Chairman that it is too bad that certain restrictions were placed on this change, particularly ones that penalize companies that have built out their networks, as those companies will incur more operating costs for that action."