New York state established a new high-cost universal service fund Thursday, the New York State Public Service Commission ruled. It said the fund will ensure state residents retain access to phone service in high-cost rural areas. The commission approved the phase 2 USF joint proposal in a 4-0 vote, with one commissioner recusing himself. The fund will provide $17 million to as many as 31 eligible telco recipients over a four-year period.

Verizon urged the FCC to make clear that wholesale providers can’t be forced to make USF contributions on behalf of carrier-customers when they obtain a reseller certification from those customers, said an ex parte filing (http://xrl.us/bnkun3). In a meeting Tuesday with an aide to Commissioner Robert McDowell, Verizon executives discussed the joint petition of AT&T, CenturyLink, SureWest, and Verizon for clarification or partial reconsideration of a 2010 order directing TelePacific to give the Universal Service Administrative Co. the names and contact information of its wholesale providers of transmission services. Verizon asked the commission to clarify that wholesale providers that complied with the directions in the Form 499 worksheet instructions can’t be made to restate their revenue and make additional contributions to the fund “if it later turns out that a reseller, for whatever reason, either should not have signed a certification or should have submitted a modified certification,” the ex parte said. Verizon also said no commission rule prohibits a customer from accurately certifying on an entity basis that it is a reseller; and that any requirement for resellers to apportion their wholesale purchases would require costly changes to ordering, billing and reporting systems, and would increase carriers’ burden of administering the contribution system.

A federal court of appeals denied the National Telecommunications Cooperative Association’s request to stay implementation of the new reimbursement limits on certain capital and operating expenses in its USF order. In its order Monday in Case No. 11-9900, the 10th U.S. Circuit Court of Appeals said it was “not convinced that petitioner has carried its burden of showing that the circumstances justify an exercise of the court’s discretion to enter a stay in this matter.” The court also declined to order the FCC to rule on NTCA’s pending application for review before implementing the new reimbursement limits. NTCA had argued the new capping methodology would violate the commission’s statutory mandate to deploy predictable and sufficient mechanisms to advance universal service (CD July 2 p12). NTCA had also argued that inaccuracies in the data set used to designate geographic boundary areas and to compute the formulas’ coefficients’ and retroactive application to limit reimbursements for expenses incurred in past years. In a statement Tuesday, NTCA Senior Vice President-Policy Michael Romano said the association had recognized the “high procedural hurdle” to obtaining a stay, but the “pervasive and paralyzing uncertainty” of the caps justified the effort. “We anticipate that once the court has the full opportunity to consider how the FCC’s caps retroactively cut support for past investments and are undermining incentives to invest in broadband moving forward, the court will find that these caps are contrary to the fundamental statutory requirements of universal service,” he said.

In the last two years, he has perhaps submitted more comments to the FCC than any other party. He has chimed in on dozens of dockets, from media ownership to USF. He has no law degree or experience in working in the telecom industry. So far this month, he has submitted more than 300 comments.

Members of the National Telecommunications Cooperative Association are active providers of both fixed and mobile wireless services, contrary to an assertion made by Sprint Nextel in its reply comments regarding USF contribution reform, NTCA said in a letter Monday (http://xrl.us/bnkk2v). Sprint had asserted that NTCA’s arguments regarding assessing text messaging services should be disregarded because “none [of those parties] provide wireless services,” NTCA said, quoting Sprint’s comments. “In fact, sixty-one percent of NTCA members responding to an association survey in 2011 indicated that they provide wireless service to consumers,” NTCA said. The association hoped its letter would correct the “factual misunderstanding."

AT&T executives met with advisers to FCC Chairman Julius Genachowski and commissioners Ajit Pai, Mignon Clyburn and Jessica Rosenworcel last week to discuss two universal service-related draft orders, its ex parte filing said (http://xrl.us/bnkkzj). AT&T stated its understanding that the commission is considering a draft order upholding a 2004 Wireline Bureau order that established an asymmetrical deadline for filing revisions to a 499-A form. The commission should adopt the Internal Revenue Service’s three year deadline for all 499-A revisions, AT&T said. Regarding the pending draft order acting on a 2010 petition for clarification filed by AT&T and several other wholesale providers of interstate telecom services, the commission should pursue the reseller directly for amounts owed to the USF, AT&T said. AT&T is also concerned about “both the scope and the substance” of the guidance offered in the tribal engagement public notice released in July, the execs said. “The alleged ‘guidance’ provided little real world guidance and the concrete examples that were included in the notice are not realistic,” the filing said.

The FCC lacks “clear authority” to require standalone fixed broadband providers to contribute to the USF, the Wireless Internet Service Providers Association said in comments filed at the FCC, in response to a further rulemaking notice. “While commenters offer claims of dubious legal authority and purported policy benefits for such a proposal, what remains is that standalone providers are, at present, legally prohibited from receiving any USF subsidies and the proposal could require such providers to subsidize direct broadband competitors,” WISPA said (http://xrl.us/bnkku5).

The National Public Safety Telecom Council began a working group to explore questions raised by public safety’s pending loss of the T-band, which was part of the February spectrum law. Public safety got the 700 MHz D-block in the legislation, but had to give up the T-band, heavily used in 11 major metropolitan areas. NPSTC sent out a questionnaire (http://xrl.us/bnkk2a) to gather information as the group prepares a report, targeted for release near the end of the year. Among the major cities where public safety uses the band are Los Angeles, Chicago, Boston, New York, Houston and Washington, D.C. The legislation required public safety users to clear the band within nine years so it can be resold in an FCC auction.

Three Alaskan lawmakers urged the FCC to approve a waiver to provide USF funds for a telecom company operating on the remote Adak Island of the Aleutian chain. “Adak is arguably the most remote community in the United States,” and its residents’ dependence on telecommunications is “enormous,” said the letter which was made public last week. Without the support of USF funds, Windy City Cellular, which serves the Adak community, can continue to operate “for only a couple of weeks” and if its service is discontinued the negative impact to the people of Adak “will be most severe,” the letter said. It was signed by Alaskan Sens. Mark Begich, a Democrat, and Lisa Murkowski, Republican, and Republican Rep. Don Young, chairman of the House Subcommittee on Indian and Alaska Native Affairs. In June the FCC granted Windy City Cellular limited interim relief of the USF/ICC Transformation Order to provide the company with $40,104 per month for a period of six months beginning in June 2012, or until the commission resolves the company’s pending waiver petition. In the relief order the commission noted that it needed additional time to “compile a full record regarding the nature and level of WCC’s costs” and complete its evaluation of WCC’s petition (http://xrl.us/bnbocq).

The FCC should grant Dell Telephone Cooperative’s petition for waiver of some of the high-cost universal service rules, small telcos told the Wireline Bureau. The Baca Valley telco in Des Moines, and Leaco Rural telco and Peñasco Valley telco in southeast New Mexico, said application of the new rules to Dell would have severe impacts and likely lead to the loss of voice service in the Dell service area. Dell seeks a waiver of the $250 per line per month cap, the rule limiting reimbursable capital and operating expenses applied to high-cost loop support, and rules limiting recovery of corporate operations expenses applied to HCLS and interstate common line support. “Given the dire financial situation facing Dell as a result of the FCC’s USF reform policies and the very real possibility that its customers will lose essential voice service, Leaco supports Dell’s request for waiver,” the telco said (http://xrl.us/bnj78m). “This is no trifling matter,” said Peñasco Valley. “There are scant alternatives for Dell’s customers if it is forced into liquidation,” the telco wrote, noting “several similarities between itself and Dell, both in the challenges of serving a sparsely populated service area in harsh (both geographic and climatic) outside plant conditions, and in the financial harm threatened by the Commission’s new high cost rules” (http://xrl.us/bnj78y).