The FCC’s USF reforms are costing jobs, National Telecommunications Cooperative Association CEO Shirley Bloomfield said Tuesday while taping an episode of C-SPAN’s The Communicators to be telecast in the coming weeks. Things such as the commission’s quantile regression analysis (QRA), meant to compare similarly situated companies, aren’t nuanced enough to take into account all the unique challenges faced by NTCA’s 900 members, she said. That uncertainty reduces investment and hurts NTCA’s members, Bloomfield said.

Rep. Marsha Blackburn, R-Tenn., led criticism of the “failed” Lifeline program Friday. “If Congress had the opportunity to reauthorize this program instead of allowing it to grow on auto-pilot, Lifeline wouldn’t be able to survive,” said a letter signed by Blackburn and 43 Republican House members, addressed to FCC acting Chairwoman Mignon Clyburn (http://1.usa.gov/1hILOBt). Lifeline, intended to help low-income Americans, has come to “symbolize everything that is wrong with Washington as it’s one of the worst examples of corporate welfare in the federal government,” they wrote, citing its rising costs in recent years and reports that question its effectiveness. There’s no way to win back trust for the program, they said. The letter included several queries to Clyburn, such as what makes Lifeline more important than other USF programs, whether she would support a $2 copay to participate in Lifeline and ways to cut spending in half by the end of 2014. “How much time and how many resources has the FCC wasted trying to save this failed welfare program?” The FCC has defended recent changes to the program as ending waste, fraud and abuse. On its website www.lifelinesupport.org/ls, the Universal Service Administrative Co., which administers the program says: “Eligible households can receive up to $9.25 per month in discounts. Additional state support may be available."

The partial federal government shutdown, in its fourth day Friday, is raising varying levels of anxiety among members of the communications bar. The shutdown’s effects rippled through the Washington area last week, giving most federal workers an unexpected, possibly unpaid, vacation, and raising some fundamental questions for those whose business is dealing with the government. Further adding to problems lawyers face, the FCC unexpectedly took almost all filings and other documents offline for the duration of the shutdown, a much more draconian response than many federal agencies (CD Oct 3 p2).

Public-private partnerships can help rural communities thrive in the face of USF reforms that limit federal funds to rural areas, said telecom analyst Craig Settles. The most successful rural broadband initiatives build community support for collaboration among public and private entities, he told ZCorum, a Georgia company that provides network monitoring and diagnostics. In the face of a “worst case” scenario of USF money just disappearing -- or, more likely, new rules that make it difficult for small telcos to qualify for funds -- rural telcos can survive by forming partnerships with local governments, he said in the interview on ZCorum’s web site (http://bit.ly/1dYmV4R). Local governments can “aggregate the demand,” and can “identify and bring to the table customers for the private sector company.” Local governments themselves can be “a primary customer base,” he said.

The FCC beat the shutdown of the federal government at midnight Monday by releasing an agenda for the Oct. 22 meeting and a handful of orders. The agency is now mostly shuttered, and will stay so as long as Congress fights over the closure, which by some accounts could extend deep into October. The FCC website is all but down, with only a few documents available related to auctions and the shutdown itself.

The E-rate program “simply needs more money,” said Jon Bernstein, president of the Jon Bernstein Strategy Group and co-chair of the Education and Library Networks Coalition. The current demand of more than $5 billion is actually “tamped down demand” because a lot of schools don’t even apply for Priority 2 funding for internal connections, as they know they won’t get it, Bernstein said at the Comptel Plus conference Wednesday. The likely demand is probably closer to $8 billion, he said. Asking for the true demand would be a nonstarter, he said, so his coalition is pushing hard for an initial increase in the E-rate cap to $5 billion. He conceded “we don’t talk about the mechanics” of how that will happen. “We are not telling them how to get there,” he said of the FCC, but when the agency wants to raise money for other USF programs, “they do what they need to do on people’s phone bills.” Bernstein estimated that adding 40-50 cents a month to telephone consumers’ bills would raise enough money to double the cap. FCC Commissioner Jessica Rosenworcel told us last week that raising the cap “certainly merits a discussion” (CD Sept 23 p3).

The FCC is getting ready to shut down most of its operations if there’s an overall government shutdown, acting Chairwoman Mignon Clyburn told reporters Tuesday after a lunch address to the FCBA. Clyburn spoke for about 20 minutes, touching on the big issues she has addressed at the helm of the agency, including 700 MHz interoperability and prison calling reform.

The state of Hawaii supports comments filed by Hawaiian Telcom encouraging the FCC to modify the Connect America Cost Model to accurately reflect the increased costs of deploying broadband in that state. “Construction in challenging volcanic terrain, the substantial undergrounding of telecommunication plant required due to tourism in the state, the substantial cost of shipping and storage of construction materials, and the necessity of extensive use of undersea cables” all require increased funding, Hawaii said (http://bit.ly/1fbnBb7). The state said it’s “concerned” that the “substantial record of need” has so far proven unsuccessful in getting additional USF money directed to its remote rural areas.

A common theme throughout the hundreds of comments filed on the FCC E-rate program this week was the plea from school districts and state alliances for an increased cap in E-rate funding (CD Sept 17 p5). Some have asked for the cap to be increased from $2.25 billion to $5 billion a year or more to fully account for the typical requests by schools and libraries. Observers, however, question whether meeting such asks is politically feasible. Increasing E-rate funding at the expense of other universal service programs might not be the best course, they told us, with some pointing to contribution overhaul as a potential answer.

Mike O'Rielly, Republican nominee to the FCC, pledged to Senate Commerce Committee Chairman Jay Rockefeller, D-W.Va., to work on improving the E-rate program. Focused on connecting schools and libraries, it faces many changes as both President Barack Obama and the FCC have pledged to alter the program to accommodate faster broadband connections. These processes have been called both ConnectED and E-rate 2.0. The committee questioned O'Rielly, policy adviser to Senate Republican Whip John Cornyn, R-Texas, and FTC nominee Terrell McSweeny in a hearing Wednesday.