RLECs Ask FCC to Change USAC Cuts in High-Cost Loop Funds for 'Parent-Trapped Lines'
Rural telcos said "illogical and inequitable" application of a USF budget control mechanism (BCM) is hindering rural telco broadband expansion. NTCA and other industry representatives targeted a Universal Service Administrative Co. calculation of reduced high-cost loop support (HCLS) under the…
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BCM. For rate-of-return telcos subject to a "parent trap" rule, they said USAC was multiplying a per-line reduction amount by a carrier's total lines, including acquired lines not eligible for HCLS. "Acquired lines that are not eligible for HCLS have no impact on the demand for HCLS and overall rate-of-return carrier high-cost support, and thus have no bearing on the BCM being effectuated," said accounting firm Moss Adams' filings (here and here) posted Tuesday in docket 10-90 on meetings with aides to all three FCC commissioners and Wireline Bureau staffers. The rural telcos urged the FCC to "restore fairness" by ensuring the BCM per-line component isn't applied to HCLS-ineligible "parent-trapped lines." The officials also "discussed the unintended consequences that the Maximum Average Per Location Construction Project Loop Plant Investment Limitation (Limitation) of the Capital Investment Allowance for rate-of-return carriers may have on broadband investment and deployment," said the filing, which said the rule was eliminating all associated investment, not limiting excess investment. "We also discussed other general concerns that are causing confusion among rate-of-return carriers on the calculation of the Limitation and the additional accounting and regulatory burdens resulting from these calculations."