The federal government should support Puerto Rico to the same extent it has for past hurricane victims in the 50 states, said Puerto Rico Telecommunications Regulatory Board (PRTRB) President Sandra Torres in an interview last week. Torres updated FCC commissioners and staff in Tuesday and Wednesday meetings in Washington (see 1801250041). Telecom infrastructure restoration continues in Puerto Rico, but funding is also needed to advance the territory’s connectivity, she said. More can be done to help Puerto Ricans, said an official from the territory's telecom industry association.
FCC commissioners heard updates on Hurricane Maria recovery from Puerto Rico Telecommunications Regulatory Board President Sandra Torres in separate meetings Monday and Tuesday, said ex-parte letters (here and here) posted Thursday in dockets 10-90 and 17-344. “Still, months after the landfall of Maria in Puerto Rico, electrical power, telecommunications infrastructure and services, and basic business and government services face serious headwinds in restoring operations to pre-hurricane levels,” the letter said. Torres urged support for high-cost rural areas, including advance release of $76 million in USF disbursements. She said 92 percent of towers and 67 percent of wireline services are restored.
The FCC urged a court to throw out a Sandwich Isles Communications mandamus request to order the agency to disburse USF subsidies withheld from the carrier since July 2015. "The extraordinary relief sought by SIC is entirely unwarranted," given "ample" legal discretion "to deny subsidies to companies like SIC that engage in fraud, waste, or abuse" in the USF program, said an opposition filed Tuesday with the U.S. Court of Appeals for the D.C. Circuit (In re Sandwich Isles v. FCC, No. 17-1248). The FCC said a jury in July 2015 convicted CEO Albert Hee of tax fraud, citing evidence he authorized using millions of dollars in corporate funds to pay personal expenses. The commission said its investigations found that SIC improperly received more than $27 million in USF payments in 2002-2015 and "improperly recouped" from the fund more than $6.7 million in "inflated" management fees for Hee family expenses. The FCC said it would lift the suspension of USF payments only after it determines how SIC will reimburse the fund, something the company "has not yet indicated." The SIC request doesn't meet mandamus standards and should be dismissed for lack of jurisdiction or denied for lacking "compelling equitable grounds," the agency said. SIC didn't comment Thursday. Another FCC filing last week disputed Sandwich Isles' bid to recover more than an estimated $1.9 million in annual costs from a National Exchange Carrier Association pooling mechanism (see 1801190059).
House Commerce Committee ranking member Frank Pallone, D-N.J., asked the Universal Service Administrative Co. Thursday to send him copies of the reports on audits it did over the past three fiscal years of the USF High-Cost and Rural Health Care programs over ongoing concerns about waste, fraud and abuse in both programs. Pallone began reviewing possible abuses of the High-Cost program last year and successfully got the GAO to begin an investigation of the program. “I am concerned that the FCC is failing to adequately address waste, fraud and abuse in the legacy portion of the High-Cost Program and is instead directing its resources solely to smaller programs” like Rural Health Care, Pallone said in a letter to USAC CEO Radha Sekar. Pallone and other House Democrats sought a GAO review earlier this week of FCC work to deploy its national verifier program to determine consumer eligibility for Lifeline funds. The commission said in early December it was delaying the launch of the national verifier program until early this year amid security issues (see 1712010042). USAC didn't comment.
E-rate school and library USF support has done much, but more efforts are needed, said FCC Commissioner Jessica Rosenworcel at an E-Rate event Wednesday. She praised Sen. Ed Markey, D-Mass., and former Sen. Jay Rockefeller, D-W.Va., for spearheading the 1996 legislation that authorized the program's creation 20 years ago. "Connecting our schools and libraries is not enough. Because preparing the next generation for digital success now requires connections not just at school -- but at home," she said according to written remarks. "More can be done to address the Homework Gap. Carriers across the country are pitching in by making available low-cost broadband service. Libraries everywhere from Maine to Missouri are loaning out wireless hot spots -- and letting students borrow connectivity for schoolwork. Rural school districts are putting Wi-Fi on buses and turning ride time into connected time for homework. Communities are mapping out where free online access is available for student use. These efforts deserve applause. More importantly, they deserve expansion."
Rural telcos urged FCC changes to a USF operations expense cap that "undermines the offering of standalone broadband services" by high-cost support recipients. The cap is based on voice loops, which "can impose an artificially low ceiling on corporate operations expenses for companies as their consumers increasingly" opt for broadband-only connections, said a filing Monday in docket 10-90 on meetings Alexicon, NTCA and WTC Communications had with aides to Chairman Ajit Pai and to Commissioners Mignon Clyburn, Mike O'Rielly and Brendan Carr. The "cap can start to apply and reduce support for companies like WTC not because the company’s corporate expenses have increased or because consumers have ceased to buy services from the company, but rather merely because consumers are choosing to buy standalone broadband services as prior reforms intended to enable," said the filing. The parties recommended rule changes to base corporate opex recovery "on connections (rather than only voice loops) that would be defined as a working loop or a broadband-only loop," and to base the calculation of broadband-only loops on data as of Dec. 31 "of the calendar year preceding each July 31 filing" to eliminate reporting inconsistencies. Pai last week circulated a draft rural USF orders and NPRM (see 1801160040 and 1801170048).
The FCC deserves praise for its response to 2017’s rush of storms but could improve its Disaster Information Reporting System, provide incentives or funding to strengthen communications infrastructure in remote areas, and establish a regional office in Puerto Rico, said commenters in docket 17-344 to a call for comments on communications resiliency and FCC handling of hurricanes Irma, Maria and Harvey.
Puerto Rico Telephone Co. asked the FCC to provide $200 million in emergency USF support to help restore telecom services disrupted by hurricanes Irma and Maria. "Although the FCC has taken considerable actions to accommodate universal service in rural areas of the country, no similar attention has been paid to insular areas," said a petition posted Friday in docket 10-90. "PRTC requests that the Commission create a $200 million emergency Universal Service Fund designated to facilitate restoration of service in insular areas by eligible telecommunications carriers ('ETCs') in Puerto Rico."
USTelecom and ITTA voiced concerns about an FCC Connect America Fund auction draft order on the tentative agenda for commissioners' Jan. 30 meeting (see 1801090050). USTelecom focused on a reconsideration issue raised by some about a potential gap between location commitments identified by a broadband cost model "and the number of locations that may actually exist on the ground in the CAF Auction eligible CBGs [census block groups]," said a filing posted Monday in docket 10-90 on a meeting telco officials had with an aide to Commissioner Brendan Carr. "Our due diligence effort revealed approximately 18% fewer locations in these CBGs. Because paragraph 25 of the Draft Recon Order would require auction winners to build out to the number of locations identified in the model regardless of the actual number of locations, a location deficit of this size could significantly reduce participation." There's "concern with Section III.D.1. of the Draft Order, regarding how to address the 'locations gap' in the [CAF Phase II] auction context," said ITTA on meetings it, NTCA, WTA and Vantage Point had with aides to Commissioners Mignon Clyburn and Jessica Rosenworcel. "Vantage Point found an overestimation of model-identified locations in 85 percent of 144 exchanges, with an average discrepancy of approximately 22 percent between model-identified locations and 'real-world' locations." Adtran said the draft "inaccurately describes" relief it requested, asking the FCC to correct the record. Hughes Network Systems reported on a meeting last week it said should have been submitted earlier due to an "inadvertent error." Kansas and Oklahoma rural telcos asked for actions to address a USF "shortfall" affecting cost-based rate-of-return telcos.
Commissioner Mike O’Rielly said Monday he was asked by Chairman Ajit Pai to help build support on Capitol Hill for addressing FCC auction authority. “I’ve pushed as hard as I possibly can and will continue,” O’Rielly said, saying he testified on the importance of a fix and discussed it in Hill meetings. Sometimes Congress needs an “incident” to happen before it's willing to move, he told reporters. He also said he's confident the FCC's net neutrality repeal won't be overturned by lawmakers or courts.