The availability of relief under a Texas state law “should not impact the company’s eligibility for a waiver of the Commission’s universal service reforms,” a Dell Telephone attorney told aides to FCC Commissioner Ajit Pai Tuesday, said an ex parte filing (http://bit.ly/100mbXs). The Wireline Bureau Wednesday denied without prejudice Dell’s petition for a waiver of several new USF rules because Dell’s home state provided its own relief (CD May 1 p8). “The availability of relief under state law should not impact the company’s eligibility for a waiver of the Commission’s universal service reforms,” the telco said. It also noted “concern” about waiting almost a year to reject Dell’s petition, when the Texas law permitting state relief was on the books since 2005. Dell believes it met the “very high standard” adopted by the FCC to obtain federal relief, General Manager Denny Bergstrom told us. But now, rural carriers in Texas need to navigate a “new hurdle” in order to stay in business, he said. “The FCC never indicated in its USF reform orders or prior waiver decisions that a waiver was conditioned upon a carrier seeking assistance at the state level,” Bergstrom said. “Dell Telephone filed its waiver petition in June 2012, and it is not clear why the Bureau could not have raised this issue long before now.”

By the 2015 school year, every school should have access to 100 Mbps Internet per 1,000 students, FCC Commissioner Jessica Rosenworcel planned to tell participants at a Schools, Health and Libraries Broadband Coalition conference Thursday evening, according to her prepared remarks. By the end of the decade, that number should increase to 1 Gbps per 1,000 students, she said. “E-Rate 2.0” will better position U.S. students to compete with those abroad, who are currently delivering faster speeds to students who are getting more math and science in their curricula, Rosenworcel planned to say. Roughly half of E-rate schools access the Internet at speeds of 3 Mbps or less, she was to say. We fail our students if we expect digital age learning to take place at near dial-up speeds.” To reach her speed goals, the commission will need more data collection, according to her prepared remarks, adding future E-rate applications should collect more information about existing capacity and projected needs. But applicants should also face a “simpler process” to get funding, she said. Multi-year and consortia applications could reduce paperwork and administrative expense, she said. To find the money for all this, the FCC needs to do more to combat waste and abuse in its other USF programs, she wrote. Lifeline needs “more mending” to free up funds to put into E-rate, she said. “We have a choice,” Rosenworcel said. “We can wait and see where the status quo takes us and let other nations lead the way. Or we can choose a future where all American students have the opportunity to gain the skills they need to compete, no matter who they are, where they live, or where they go to school."

Several Texas telcos have sought recovery of millions of dollars’ worth of lost federal support money from the state’s USF (CD April 4 p5). “We commend Texas for creating a process to address any unique concerns for carriers in the state of Texas as a result of recent universal service reforms,” the order said. “We consider these efforts to be a positive development for federal-state coordination and partnership, and encourage other states to consider similar approaches as states may be best positioned to address any unique circumstances for carriers in their state."

Allband pressed its case for a 15-year waiver of USF support caps, in meetings Wednesday with FCC officials. Allband already has a 3-year waiver, granted in July by the Wireline Bureau (CD July 27 p6). The bureau had asked Allband to take “all reasonable steps” to meet the $250 per-line per-month cap on USF support, but that’s simply not possible, Allband told aides to commissioners Mignon Clyburn, Jessica Rosenworcel and Ajit Pai. “Even unrealistic steps to reduce costs and increase revenues will not allow Allband to meet the $250 cap” by the time its waiver expires on July 1, 2015, the rural Michigan telco said (http://bit.ly/15Y97pw). That’s why Allband asked for a 12-year extension in August (CD Aug 27 p1), which would let it repay its Rural Utilities Service loan, the telco said. If the application isn’t granted, Allband will require a new waiver in 2014, which will cost at least $50,000 to put together, it said. That kind of expenditure is “inefficient and unnecessary when it is clear that no action Allband can take will allow it to meet the $250 cap,” it said. Allband also took issue with the Wireline Bureau’s dismissal of its request for a waiver of the regression caps on high-cost loop support. The bureau had said the request was moot because Allband would not be affected by the caps, but “the current regression caps do impact Allband,” the telco said. The company “may be able to absorb the 2013 impacts,” but not the 2014 impacts, it said. “As a consequence, Allband will, by 2014 be unable to pay the full amount of its RUS loan obligation, and voice service along with all services provided by Allband will be in jeopardy.”

The FCC may be putting too much focus on cutting abuses in the Lifeline program and not enough on making sure everyone who needs support gets it, said members of the agency’s Consumer Advisory Committee. Lifeline reform was the subject of a contentious hearing Thursday by the House Communications Subcommittee (CD April 26 p1), the day before CAC met at commission headquarters.

Telcos and carriers in favor of the FCC’s USF/intercarrier compensation (ICC) reforms filed several briefs Wednesday supporting the agency’s 2011 order. The FCC “ably refutes” the various claims, intervenors told the 10th U.S. Circuit Court of Appeals, but they wrote separately to “highlight” several points.

House Communications Subcommittee Chairman Greg Walden, R-Ore., said there is “plenty of blame to go around” but the current data on the program “doesn’t paint a picture of success,” in his opening remarks. He said the Lifeline fund grew 226 percent since 2008 and, in 2012, the FCC spent $2.2 billion on the program. “Specifically, it spent $2.2 billion of your money, my money -- virtually every American’s money -- since the Lifeline program and the entire Universal Service Fund is paid for through a charge on phone bills,” he said. “We are spending large sums of money and probably squandering much of it.”

Arguing that the commission overstepped its bounds when it required eligible telecom carriers to use USF support to provide broadband service, the carriers claimed Congress didn’t delegate Title II authority to the FCC to regulate broadband. Section 254(b), which the FCC relied on for jurisdiction, is “clearly” not a jurisdiction-conferring provision, the carriers wrote. “Congress conferred no jurisdiction by its references to ‘advanced telecommunications and information services.’ It merely stated principles to guide the FCC in exercising its authority.” In its response, the FCC argued that argument was “not properly before the court because it was not first presented to the FCC.” The commission also attacked petitioners’ “unsound” argument.

FCC Commissioner Ajit Pai called for a Connect America Fund to support broadband buildout for rate-of-return carriers. Also at an NCTA conference Monday, Rural Utilities Service Acting Administrator John Padalino noted he and U.S. Department of Agriculture Secretary Tom Vilsack had asked for expanded USF support (CD Feb 20 p3). Broadband buildout support for rate-of-return telco carriers “would recognize that line loss in rural America is real, and that direct support for broadband-capable facilities” is “critical,” Pai said. Rural representatives twice interrupted him with applause, as Pai, who grew up in Kansas, repeatedly characterized himself as a friend of rural interests. “My name is Ajit, and I am a rural American,” he said. “When I confront a rural issue, whether it is about call completion or universal service or outdated regulations, it isn’t just an abstraction to me."

The FCC did not act within its discretion when it determined InterCall’s services were “telecommunications” service and required the company to pay into the USF, Arent Fox attorney Ross Buntrock argued for The Conference Group. The agency also did not act properly in issuing the order through adjudication, rather than through the notice-and-comment rulemaking procedures it must follow under the Administrative Procedure Act, Buntrock said.