The lawyer for the Tri-County Telephone Association challenging the FCC’s nearly $1 billion USF telecom rebuild program for Puerto Rico and the U.S. Virgin Islands faced questions Thursday as the U.S. Court of Appeals for the D.C. Circuit heard oral argument in TCT's case (docket 20-1003 in Pacer). Judges challenged the group’s argument that the FCC doesn't have authority to use high-cost USF support dollars for disaster relief.
Increasing the Lifeline benefit would require USF contribution changes, AT&T Executive Vice President-Regulatory Joan Marsh blogged Wednesday. Lifeline “needs to be reformed from its current provider-centric structure to one that instead puts the beneficiary at the center of a more digital approach, as modeled after the Department of Agriculture’s successful and evolving [Supplemental Nutrition Assistance Program] program,” Marsh said. Congress must "ensure that funds are directly appropriated to support any benefit increase or otherwise ensure that the USF funding mechanism is significantly reformed,” she said. Carriers, state regulators and public industry groups united in opposition to an FCC proposal to raise the Lifeline wireless broadband minimum service standard (see 2009150072). In Sept. 3 letters replying to Rep. Anna Eshoo, D-Calif., and other members of Congress, posted Tuesday, Chairman Ajit Pai said the commission “is faced with wildly divergent requests." The "subscribers shouldn’t receive second-class service, so the status quo is unacceptable,” but a dramatic increase “is likely to disrupt the market,” he wrote. Pai proposed a “modest increase to 4.5 GB.”
Increasing the Lifeline benefit would require USF contribution changes, AT&T Executive Vice President-Regulatory Joan Marsh blogged Wednesday. Lifeline “needs to be reformed from its current provider-centric structure to one that instead puts the beneficiary at the center of a more digital approach, as modeled after the Department of Agriculture’s successful and evolving [Supplemental Nutrition Assistance Program] program,” Marsh said. Congress must "ensure that funds are directly appropriated to support any benefit increase or otherwise ensure that the USF funding mechanism is significantly reformed,” she said. Carriers, state regulators and public industry groups united in opposition to an FCC proposal to raise the Lifeline wireless broadband minimum service standard (see 2009150072). In Sept. 3 letters replying to Rep. Anna Eshoo, D-Calif., and other members of Congress, posted Tuesday, Chairman Ajit Pai said the commission “is faced with wildly divergent requests." The "subscribers shouldn’t receive second-class service, so the status quo is unacceptable,” but a dramatic increase “is likely to disrupt the market,” he wrote. Pai proposed a “modest increase to 4.5 GB.”
The Nebraska Public Service Commission should keep the revenue-based USF contribution for business and government services because it’s less complex than a connections-based mechanism, big telecom and cable companies said in comments received Monday and emailed to us Wednesday. The PSC is proposing to expand its connections-based method that now applies only to residential services (see 2008110047). “Business customers' connections may fluctuate” and “the applicable surcharge would need to be examined, and potentially changed on a monthly basis,” Cox Communications, Charter Communications and Time Warner Cable commented jointly in docket NUSF-119. Large business customers might relocate to a lesser taxed state due to rate shock, the cablers warned. Carriers understand revenue-based contribution; applying contributions to business and government services “will be complex, costly and confusing,” said AT&T. Complexities applying the connections method to business and government services have increased in the past three years, said CenturyLink. COVID-19 “has caused an unprecedented shift to work from home and away from business communications services which is likely to impact the analysis,” it added. Nebraska law requires revenue-based contribution for prepaid wireless services, said CTIA. A connections method for residential services stabilized and increased the fund, so "the financial threat to the NUSF viability has been overcome,” said Frontier Communications. Moving to connections for business and government lines is "impractical at this time," said Windstream. Small rural telcos countered that applying connections-based contribution for all kinds of services is fairer. “Much of rural Nebraska remains unserved or underserved," and current remittances "will come nowhere close" to providing enough support, commented the Rural Telecommunications Coalition of Nebraska. Exempt prepaid wireless, toll revenue and directory, private line and paging services, which don't lend themselves to a connections-based surcharge, said a state group of rural independent companies. Keep revenue-based at least for institutional operator service providers, urged Securus, saying it doesn’t “have the ability to determine or charge the NUSF applying a connections-based methodology" because it charges prison customers per call.
Industry, USF recipients and consumer advocates are exploring new ways to fund USF. Talks began last year and remain in early stages, participants said in interviews. Parties fear the contribution factor, which reached a record high of 25% last fall (see 1909130003), isn't sustainable. Some want to present a unified funding proposal to Congress or the FCC. Most want the matter addressed next year.
Prospects for advancing legislation on allocating proceeds from the FCC’s coming auction involving of spectrum in the 3.7-4.2 GHz C band have become increasingly doubtful after more than two months in which negotiations were largely in stasis due to Capitol Hill's shift in priority to the COVID-19 pandemic, lawmakers and communications sector officials said in interviews. Senate Appropriations Financial Services Subcommittee Chairman John Kennedy, R-La., and Democratic backers of C band remain interested in pressing forward. Republicans on the House and Senate Commerce committees believe the time for pursuing legislation has largely passed given FCC moves to advance the auction. Wireless and satellite interests cited concerns with the FCC's order in petitions for reconsideration filed Wednesday (see 2005270031).
Broadening the USF contribution base won't harm broadband adoption, a report commissioned by NTCA said Thursday. The Berkley Research Group paper suggested a 1% USF contribution surcharge for broadband could reduce consumer broadband demand by 0.08%. Reps. Collin Peterson, D-Minn., and Don Young, R-Alaska, led filing Tuesday of the Universal Broadband Act to codify that broadband is within USF's scope (see 2005050064). “Long-term viability of the Universal Service Fund is essential,” said NTCA CEO Shirley Bloomfield. She said the program "could be at risk if we keep ‘kicking the can down the road’ on addressing the shaky foundation of an ever-escalating and volatile contributions mechanism." Bloomfield told us earlier this spring that as new USF programs such as the Rural Digital Opportunity Fund are added, policymakers must address revenue that supports subsidies. "There's only so many coins you can find under the couch cushion," she said of existing contribution methodology that relies on long-distance voice revenue.
Broadening the USF contribution base won't harm broadband adoption, a report commissioned by NTCA said Thursday. The Berkley Research Group paper suggested a 1% USF contribution surcharge for broadband could reduce consumer broadband demand by 0.08%. Reps. Collin Peterson, D-Minn., and Don Young, R-Alaska, led filing Tuesday of the Universal Broadband Act to codify that broadband is within USF's scope (see 2005050064). “Long-term viability of the Universal Service Fund is essential,” said NTCA CEO Shirley Bloomfield. She said the program "could be at risk if we keep ‘kicking the can down the road’ on addressing the shaky foundation of an ever-escalating and volatile contributions mechanism." Bloomfield told us earlier this spring that as new USF programs such as the Rural Digital Opportunity Fund are added, policymakers must address revenue that supports subsidies. "There's only so many coins you can find under the couch cushion," she said of existing contribution methodology that relies on long-distance voice revenue.
Reps. Collin Peterson, D-Minn., and Don Young, R-Alaska, led filing Tuesday of the Universal Broadband Act to codify that broadband is within the scope of universal service. The bill would increase the USF contribution base to include all broadband services rather than the existing model that draws support from phone services. Peterson said “it’s unacceptable that rural communities have limited, unreliable or worse yet no broadband access” amid the COVID-19 pandemic. Eight House members signed as co-sponsors: Ed Case, D-Hawaii; Angie Craig, D-Minn.; Luis Correa, D-Calif.; T.J. Cox, D-Calif.; Vicente Gonzalez, D-Texas; Frank Lucas, R-Okla.; Hal Rogers, R-Ky.; and Jeff Van Drew, R-N.J. The lawmakers noted support from several companies and groups, including the American Farm Bureau Federation, Consolidated, National Association of State Departments of Agriculture, National Farmers Union, NTCA, Power & Communication Contractors Association and WTA.
Reps. Collin Peterson, D-Minn., and Don Young, R-Alaska, led filing Tuesday of the Universal Broadband Act to codify that broadband is within the scope of universal service. The bill would increase the USF contribution base to include all broadband services rather than the existing model that draws support from phone services. Peterson said “it’s unacceptable that rural communities have limited, unreliable or worse yet no broadband access” amid the COVID-19 pandemic. Eight House members signed as co-sponsors: Ed Case, D-Hawaii; Angie Craig, D-Minn.; Luis Correa, D-Calif.; T.J. Cox, D-Calif.; Vicente Gonzalez, D-Texas; Frank Lucas, R-Okla.; Hal Rogers, R-Ky.; and Jeff Van Drew, R-N.J. The lawmakers noted support from several companies and groups, including the American Farm Bureau Federation, Consolidated, National Association of State Departments of Agriculture, National Farmers Union, NTCA, Power & Communication Contractors Association and WTA.