Broadband providers challenged up to 36,897 of 317,243 census blocks on a preliminary FCC list of areas targeted for a planned Connect America Fund reverse auction of $215 million in annual broadband USF subsidies, according to our review. The agency asked interested parties to update the FCC on areas that wouldn't be eligible for auction support because of the presence of a qualifying broadband service -- with 10/1 Mbps, minimum usage of 150 GB or greater at a rate meeting a commission benchmark, and latency not exceeding 100 ms (see 1608110018). Twenty-two parties submitted filings that were posted by Thursday in docket 10-90. Frontier Communications led the way, saying it provided qualifying broadband service to 15,789 census blocks on the preliminary list, based on our tabulation of its submission. JAB Wireless (Rise Broadband) said it served 11,278 census blocks and Windstream said it serves 3,170 census blocks on the list. AT&T serves 2,929 census blocks and Charter Communications serves 1,341 census blocks on the list. The numbers could increase because some parties said they will update their totals, and N.E. Colorado Cellular (Viaero Wireless) filed its list confidentiality. But it's also possible there's some overlap among the census blocks identified by different parties as served, which could reduce the total number of reportedly served census blocks. After the FCC completes the review process, it will issue a final list of eligible census blocks. Some auction rules are still under consideration.
States, the FCC and industry plan extensive outreach to reduce consumer confusion about changes to Lifeline that will allow the USF program for low-income people to get broadband and not just phone service, officials said on a Wednesday webinar staged by the National Regulatory Research Institute, the research arm of NARUC. "We think it's very important that we help in getting the word out … because there will be a lot of confusion," said Massachusetts Department of Telecommunications and Cable Commissioner Karen Charles Peterson. Lifeline tops the department’s list for planned outreach efforts, and the state government hopes the low-income program will play a big role in a state effort to increase broadband adoption, she said. The FCC plans to make copious amounts of information available through its website and other outreach venues, said Wireline Bureau Telecommunications Access Policy Division Chief Ryan Palmer. TracFone plans targeted communications to customers rather than a broad and generalized approach, said the company’s Corporate Counsel Stephen Athanson. AT&T sees potential for customer confusion because it will take some time for states to sync their programs with the federal program, said Executive Director-Public Policy Beth Fujimoto. She said the company supports a USTelecom reconsideration request pending at the FCC, including deferring the effective date of the streamlined eligibility criteria to give states more time to make necessary changes (see 1608090023). States won’t find a uniform method to implement the order, said Peterson. "Each state is unique and they're going to have to address it in their own way." The commissioner said one concern of states is what happens to consumers’ ability to call 911 if they're moved from voice to broadband plans. She said the issue is “hard to explain to the average citizen.” Massachusetts plans to work with consumers, industry and the FCC “to make sure a consumer doesn’t have to pick” between voice and broadband, she said.
FCC staff teed up the National Exchange Carrier Association's proposed modifications to its high-cost loop USF formula for "average schedule" rate-of-return companies in 2017 (see 1608260028). A Wireline Bureau public notice Wednesday in docket 05-337 said comments are due Sept. 30, replies Oct. 17 on the NECA proposals, which incorporate changes from the FCC March 30 rural broadband USF overhaul order (see 1603300065).
The FCC opposed Blanca Telephone's court petition to halt the commission's effort to collect a debt resulting from $6.7 million in USF overpayments the agency said the company received. The FCC said it demanded repayment in full from Blanca June 2; the firm filed an application for review by the commission June 16; the agency informed the telco it would take no further action to collect the debt while that application is pending; and the company filed a petition for a writ of prohibition with the U.S. Court of Appeals for the D.C. Circuit. "Remedies under the All Writs Act, such as prohibition, are reserved for extraordinary cases and, in addition to other requirements, are available only where the petitioner lacks any other means to obtain the relief sought," said the FCC opposition posted Wednesday. "Here, when the agency acts on Blanca’s pending application for review, if Blanca remains aggrieved, it can seek judicial review pursuant to ... the Communications Act and the Hobbs Act. It is well established that the availability of such statutory review procedures are adequate alternative remedies. The petition is therefore baseless." The case is: In re Blanca Telephone Company, No. 16-1216. A Blanca representative said the company would file a court response.
Some FCC members of each party voted for and against an Alaska plan for broadband-oriented USF support to fixed and mobile providers in high-cost areas of the state served by rate-of-return telcos and their wireless affiliates. The commission adopted the Alaska Telephone Association's (ATA) "consensus plan" with "minor modifications," said the 3-2 order and Further NPRM released Wednesday in docket 10-90. Commissioners Mignon Clyburn and Ajit Pai dissented. Pai said the plan would provide $1.5 billion in support over 10 years. A separate Alaska price-cap USF draft order is pending.
NARUC said it's postponing Lifeline Awareness Week in September due to new FCC rules that extend the USF low-income subsidies to broadband service and streamline the program's administration, which affects state regulatory oversight (see 1603310056). “It will take time for carriers and states, especially those with matching programs, to adjust to the Lifeline changes instituted by the FCC. To avoid increasing consumer confusion by providing outdated information, we have chosen to postpone the 2016 awareness week,” said NARUC President Travis Kavulla in a release Monday. NARUC and some states are challenging the new process for designating national Lifeline broadband providers that allows parties to bypass state eligible telecom carrier reviews (see 1606030053 and 1607010057).
The National Exchange Carrier Association proposed modifications to its USF formula for calculating high-cost loop support for "average schedule" rate-of-return companies in 2017. The proposal incorporates changes from the FCC's March 31 rural broadband USF overhaul order, including a continued annual reduction of 25 basis points in the authorized rate-of-return and new restrictions on operating expenses, said a NECA filing Thursday in docket 05-337. The previous 11.25 percent rate of return dropped to 11 percent July 1 and will drop to 10.75 percent July 1, 2017, under the proposed formula, on its way to 9.75 percent in 2021.
FCC staff announced two new filing windows for seeking USF rural healthcare support for the 2016 funding year that began July 1, plus another window for the 2017 funding year. The program provides subsidies for rural healthcare telecom services and broadband connectivity. An initial March 1-June 1 filing window drew $35.5 million in requests, with the program operating on a first-come, first-served basis since then, said a Wireline Bureau public notice Friday in docket 02-60. A new filing window is Sept. 1-Nov. 30, with no funding requests accepted through Jan. 31 the PN said. Universal Service Administrative Co. will process all the requests to that point; if there's still funding available under the FCC $400 million annual cap for the program, which the bureau expects, a third funding request window will run Feb. 1-April 30, with the possibility of a new window after that, it said. It also announced an overlapping initial filing window of Feb. 1-April 30 for the funding year that begins on July 1, 2017. The PN said demand for rural healthcare USF support has been growing and could reach the $400 million cap during one of the windows for this funding year, which would require USAC to divvy up support to qualifying requests on a "pro-rata basis" for that window.
NTCA said the FCC should approve its petition for reconsideration of a USF overhaul for rate-of-return carriers, given the lack of any opposition to its requests and ITTA's support for some of them. The FCC should admit that its rules will preclude most rural telcos from offering standalone broadband at rates reasonably comparable to urban rates, and either revisit its rate-of-return budget or suspend a requirement that carriers certify they are providing standalone broadband at reasonably comparable rates, said NTCA in reply comments, one of several replies posted Thursday and Friday in docket 10-90. NTCA also said it asked the agency to address concerns its new budget controls and "haircuts" would create an unlawful regulatory "black hole" into which carrier costs disappeared and were never recovered. GVNW Consulting, which works with rural carriers, agreed with NTCA's "black hole" description and proposal to either revisit the budget or suspend the stand-alone broadband certification requirement. GVNW also backed various WTA requests, including for the FCC to alter the definition of a qualifying unsubsidized competitor (which prevents an RLEC from receiving funding) as one that can provide the same broadband speeds as the incumbent, and to give carriers more flexibility on meeting buildout requirements. Custer Telephone Cooperative and other RLECs said there was no opposition to their petition for reconsideration of the agency decision to reduce support and add broadband buildout requirements for rate-of-return carriers remaining on revised legacy support mechanisms while shifting support to carriers electing model-based support. The National Tribal Telecommunications Association agreed with NTCA and WTA concerns about the budget and the need to ensure reasonable comparability, which NTTA believes is particularly appropriate regarding tribal areas. NTTA believes its proposed tribal broadband factor would help rate-of-return carriers provide tribal service. Sacred Wind Communications, which serves the Navajo Nation, agreed with WTA that qualifying competitors should be held to the same broadband speed standards as incumbent rural carriers, and said there should be a streamlined extension process for meeting buildout duties.
AT&T disputed an FCC Enforcement Bureau-proposed $106,425 fine, denying it overcharged two Florida school districts and violated a "lowest corresponding price" (LCP) rule under the E-rate USF subsidy program. The bureau's arguments are "factually wrong," "deviate from the FCC's own rules and existing precedent" and continue a "troubling pattern of 'rulemaking through enforcement,'" said Joan Marsh, vice president-federal regulatory, in a blog post Friday. Marsh said the bureau was wrong to assume AT&T should have provided rates based on one-year contracts when the school districts never asked for those and instead bought services month to month, which she said the commission recognized as a valid basis for price distinctions in a 1997 order. She said the bureau was wrong to fault AT&T for not providing rates as if the school districts belonged to a Florida E-rate consortium, which pools the purchasing power of state agencies and organizations and which the districts chose to avoid. The bureau also took "the extreme position" that the LCP obligation applied even if the service was not purchased through the E-rate Form 470 competitive bidding program, a view she said the FCC never before had articulated and was at odds with the program. Finally, Marsh said the bureau disregarded procedures by ignoring a statute of limitations that had expired and the lack of FCC jurisdiction to adjudicate disputes over intrastate services. She said the company was filing its response to a July 27 notice of apparent liability (see 1607280028).