ST. LOUIS -- State members of the USF Federal/State Joint Board, the Federal/State Jurisdictional Separation Joint Board and the Federal/State Joint Conference on Advanced Services were schedule to meet with the FCC officials attending the NARUC meeting in here late Monday, after our deadline, John Burke, chair of the NARUC telecom committee told us. The FCC attendees, including Commissioners Michael Copps, Mignon Clyburn, Wireline Bureau Chief Sharon Gillett and Deputy Bureau Chief Carol Mattey, were expected to talk about the timing of the release of the full universal service fund/intercarrier compensation order and an overview of what is in the order, Burke said.

Democratic FCC Commissioner Mignon Clyburn urged critics of the recent Universal Service Fund changes not to take their claims to court. “Instead, I ask that we work together to complete and perfect these reform efforts,” Clyburn told an audience Tuesday in Boston for a broadband conference. “By doing so, we can ensure that the transition of the fund from voice to broadband opens the door for every citizen to become a part of our digital economy. When that occurs, the decade-long struggle to achieve these reforms will have been well worth the effort.”

Verizon Executive Vice President Tom Tauke rejected claims that his company was a net beneficiary of the sweeping changes to the Universal Service Fund and the intercarrier compensation regime. “It’s something of a mixed bag,” he said in an interview on “The Communicators” on C-SPAN that was to have been telecast over the weekend. The company’s wireless division will gain from the FCC’s order, but its wireline division will lose, he said. Analysts and telecom observers had suggested that Verizon and AT&T were the biggest winners from last week’s order (CD Oct 28 p1). “But overall, it’s going to be good for the industry, it’s probably good for our company,” he said.

The telecom world largely responded cautiously as the FCC on Thursday adopted its Universal Service Fund and intercarrier compensation regime changes. But telecom officials and observers predicted lawsuits would begin pouring in after the 400-plus page order is published and digested. Meanwhile, the order itself hadn’t been finished, an FCC official told us. Staff were continuing to incorporate edits agreed upon by the commissioners late in the process but before the vote, and the order won’t be ready for release until at least the end of next week, the official said. Less-substantive changes are also still being made.

AT&T is clinging “to an outdated and unworkable conception of intercarrier compensation” when it lobbies against cable operators’ request to allow CLECs to charge the same access rates as ILECs even when the CLECs don’t terminate calls, Comcast, Cox Communications and Time Warner Cable said in a letter filed Monday (CD Oct 24 p6). The dispute between the two companies flared up late last week, as the sunshine rules took effect and closed lobbying on the pending Universal Service Fund and intercarrier compensation system order. AT&T was trying “to maintain ILEC-centric rules,” but is striving “mightily to obscure a simple, fundamental point,” the cable companies said.

FCC Chairman Julius Genachowski’s proposed Universal Service Fund reforms are “inconsistent with the White House’s vision and direction,” a breakaway group of rural carriers wrote to President Barack Obama last week. “Your administration has announced its commitment to broadband deployment and regulatory reforms that will spur job creation and overall economic expansion,” said the Rural Broadband Alliance’s letter, according to an alliance release Monday. “However, the FCC is preparing reform measures that will completely undercut such investment and growth by sidestepping the broadband issue while simultaneously cultivating an environment of continuing regulatory and economic uncertainty throughout much of rural America.” The alliance was formed in July by several rate-of-return carriers angry that the big rural associations were about to make a separate peace with price cap carriers on USF reform (CD July 29 p1). Pending USF reforms and the intercarrier compensation regime will have a “relatively muted” impact on mid-sized, price cap carriers, analysts at UBS predicted Monday. Most of the companies “have lowered their exposure to subsidies with their recent acquisitions” and the FCC’s proposed reforms “will also allow [the mid-sized carriers] to offset most of the pressure with increases in subscriber line charges and/or with access to the new Connect America Fund,” analysts Batya Levi and John Hodulik wrote. USF and intercarrier comp represent 4 percent of revenue, 8 percent of earnings before interest, taxes, depreciation and amortization, and 12 percent of free cash flow for CenturyLink; 5 percent of revenue, 8 percent of EBITDA and 15 percent of cash flow for Windstream; and 8 percent of revenue, 12 percent of EBITDA and 18 percent of cash flow for Frontier, the analysts said. “However, our models already incorporate significant revenue declines in this revenue stream, capturing most of the impact of the new reform,” Levi and Hodulik said. “If the competitive environment does not allow the carriers to raise the SLC or if the carriers are unable to tap the new fund, then we would have to cut our … estimates by 3-5 percent for revenues, 6-8 percent for EBITDA and 9-10 percent for FCF.” The mid-sized price cap carriers offered up the ABC plan, but they have been increasingly dismayed by the direction of USF reforms over the past few weeks (CD Oct 19 p1).

Incumbent carriers are using “the government to ensure that they do not have to compete,” NCTA President Michael Powell said on the association’s website Monday. “Considering the overall objective of delivering broadband to all Americans, it is astonishing that the FCC is considering a regime in which the largest incumbent telcos would be granted the inherent right to all of the available money in certain areas, before any other industry (which are equally able and committed to serve) has a chance to compete.” Powell was referring to the right of first refusal provisions in the pending Universal Service Fund order. “Cable is the leading broadband provider in the nation, but it will have to stand in line behind wireline telephone companies,” he wrote. “Wireless is one of the most exciting ways for accessing the Internet (homage to Steve Jobs) yet they stand in the consolation line as well. And what is the harm of allowing competition?” Cable executives and lobbyists pushed hard in the final week of USF lobbying. Docket 10-90 showed no fewer than seven ex parte notices filed by cable lobbyists last week. Formulas to cap rate-of-return carriers’ operating or capital expenses “should be decided by the full Commission rather than on delegated authority at the Bureau level,” the four largest rural telecom associations told aides to FCC Chairman Julius Genachowski in a meeting last week. Rural carriers are worried that Genachowski’s intercarrier compensation regime reforms “could result in year-over-year decreases in access recovery that are not tied to costs,” said lobbyists for NTCA, the National Exchange Carrier Association, the Western Telecommunications Alliance and OPASTCO, according to an ex parte notice released Monday in docket 10-90 (http://xrl.us/bmgxa9). The rurals also urged the FCC not to consider wireless companies as “unsubsidized competitors” when excluding USF support for areas where unfunded carriers are already offering broadband.

FCC Chairman Julius Genachowski proposed a new plan to support small business cybersecurity efforts, during a speech at the U.S. Chamber of Commerce Monday. The Small Business Cyber Planner is a free online tool to help U.S. small businesses increase their cybersecurity awareness and protections, and will be available on the FCC website in “a few weeks,” Genachowski said. The Department of Homeland Security endorsed the plan and encouraged small business owners to implement strong cybersecurity policies.

Alaska’s governor said FCC Chairman Julius Genachowski didn’t seem to heed his advice to ensure that any changes to the Universal Service Fund account for his state, which has costs to deliver rural telecom and broadband that are the highest in the U.S. “Any reduction in current USF levels of support would reduce these services, increase local access charges which are already the highest in the nation and, in some cases, would likely jeopardize basic services in our most rural communities,” Sean Parnell (R) wrote last week. “I have written to you directly on several occasions and submitted official comments since USF reform was first proposed. Yet, still, it would appear that my message has not reached you and your staff.” He’s “dismayed” to hear the draft proposal the agency is considering would “slash annual USF high cost support to Alaska over the next five years by as much as 70 percent,” or up to $160 million, Parnell wrote. The USF sends Alaska about $200 million yearly, more support per line than any state, an FCC spokesman said Friday. “The current system funds multiple carriers in urban areas in Alaska, like Anchorage, yet other areas in remote areas of Alaska go unserved by broadband or mobile services. We will continue to work with all affected stakeholders in Alaska in the short-term and long-term to find fiscally responsible solutions that provide carriers in Alaska with the certainty needed -- and explicit support necessary -- to invest in broadband and mobile services to all Alaskans.” Parnell’s Oct. 17 letter was posted in docket 10-90 on Thursday (http://xrl.us/bmgpm6). Alaska cable operators like GCI and telcos have sought a separate plan for the state, as FCC members are scheduled to vote this week on a USF and intercarrier compensation order (CD Oct 20 p18).

The AT&T/T-Mobile deal, spectrum bills and controversy over possible GPS interference drove communications industry lobbying in Q3, said quarterly lobbying disclosure reports due Thursday. Most telecom, cable and Internet companies increased their spending from Q3 2011. Public safety continued its high level of spending as Congress moved closer to decide on providing money and possibly spectrum for a national network. Google continued to increase its Washington presence, spending more than T-Mobile and Sprint Nextel combined last quarter.