NARUC and 12 states said an FCC Lifeline order improperly bypassed state authority to designate USF-eligible telecom carriers (ETCs) under the federal Communications Act. NARUC said the commission's Lifeline broadband provider designation process order "displays a purposeful disregard of the Congressional scheme and lack of reasoned decision making" and deserved no judicial deference under the Chevron precedent. "Congress specified that State commissions, in the first instance, designate all ETCs," said the state regulators' association brief (in Pacer) Monday to the U.S. Court of Appeals for the D.C. Circuit in NARUC v. FCC, No. 16-1170. The order "claims to 'preempt' that §214(e)(2) State procedure based on the facially illogical claim that this Congressional mandate 'thwart[s] federal universal service goals.' Instead, the Order permits only the FCC to designate a new category of the federal Lifeline carriers -- Lifeline broadband internet access service providers," a process that also "undermines State universal service programs, service quality to the end-user, and increases the chances for ETC fraud and abuse," NARUC said. It asked the court to vacate the designation process and other aspects of the order, including FCC decisions giving federal ETCs the initial say over low-income consumer access to state Lifeline subsidies and using forbearance authority to eliminate state service mandates. Twelve states led by Wisconsin's attorney general filed another brief (in Pacer) saying the order "attempted to amend federal law by regulatory fiat to increase its own authority, while taking away the States' statutory rights." Joining were officials from Arkansas, Connecticut, Idaho, Indiana, Michigan, Mississippi, Montana, Nebraska, South Dakota, Utah and Vermont. An intervenor brief from the National Association of State Utility Consumer Advocates is due Monday. The FCC brief is due March 16.
State commissioners stressed the importance of federalism and state oversight in three telecom resolutions set for consideration this month at NARUC's winter meeting. NARUC released the proposed resolutions Tuesday. The Feb. 12-15 meeting in Washington will be the group's first since President Donald Trump took office and Ajit Pai became FCC chairman. The meeting will include a keynote by House Commerce Committee Chairman Greg Walden, R-Ore., and a congressional staff panel, said a recent agenda.
FCC Chairman Ajit Pai said a new broadband deployment advisory committee (BDAC) would seek ways to spur the rollout of high-speed internet access networks and close the digital divide. He said the BDAC would be charged with identifying regulatory barriers to broadband infrastructure investment, and recommending actions to remove or reduce them. The panel also would draft a model code for localities to follow to encourage deployment, he said, announcing its formation in a statement at the commissioners' Tuesday meeting, followed by a news release and a public notice (documents here).
State government officials and others stressed benefits for rural schools as Arizona seeks to take advantage of up to $100 million in federal E-rate Category One funding for broadband. The state must act quickly to meet a likely April deadline to submit funding applications to the Universal Service Administrative Co., the officials said at an all-day Arizona Corporation Commission (ACC) workshop live-streamed Monday. The workshop is part of a rulemaking to create an estimated $8 million-$10 million state match of rural broadband funds with funding from the state USF (see 1701110062). With nearly a quarter of Arizona schools not meeting the national standard of 100 kbps per student -- affecting about 250,000 students -- the E-rate funding is a way to “get rural Arizona into the game,” said Commissioner Andy Tobin (R).
About 30 rural telcos told the FCC this past week they intend to stop offering broadband internet transmission service as separate components of their broadband internet access services. Minnesota Valley Telephone and Winthrop Telephone made filings (here and here) Friday of their broadband intentions, joining other rural telcos from Minnesota, Wisconsin and Iowa that made such filings in dockets 01-92, 14-28 and 10-90 earlier in the week. Under a Wireline Bureau clarification last June of the FCC's net neutrality and broadband reclassification order, the rate-of-return carriers said, "the revenues associated with the broadband internet access transmission would no longer be subject to the federal universal service fund assessment." FairPoint Communications made a similar move last year (see 1606280037).
Efforts to boost broadband in an infrastructure bill have appeal but face differences and uncertainties over the initiative's structure and size, speakers at a USTelecom event Thursday indicated. A telco executive urged using existing funding mechanisms and new tax incentives; a Senate Democratic staffer cited a plan to provide $20 billion for broadband through executive branch programs (see 1701240067); a House Republican staffer said his members are seeking to encourage broadband but are still working on a plan; and a Trump transition team member opposed repeating the 2009 broadband stimulus approach. The member said FCC restructuring should include an economics bureau; and an AT&T official cited its gigabit-speed efforts in six North Carolina cities.
FCC staff took many actions in Chairman Tom Wheeler's last three weeks in office, including some that were controversial, despite Republican pressure to act by consensus during the transition to President Donald Trump. Then-Commissioner Ajit Pai warned in December about "midnight regulations." He and fellow Republican Mike O'Rielly objected to several items issued in January -- a Wireless Bureau report criticizing AT&T and Verizon zero rated data practices, and certain Media Bureau broadcast orders -- and they indicated the issues would be revisited in a GOP-run commission.
In one of the first actions under new Chairman Ajit Pai, FCC staff approved 182 rural telcos to receive $454 million in annual broadband-oriented USF subsidies through the Alternative Connect America Cost Model (A-CAM). Rural telcos called the action a boost for rural broadband, though some called for further funding efforts. Pai said he wants to ensure rural areas get fast web service. Meanwhile Tuesday, he named bureau chiefs and other key staff (see 1701240064).
Outgoing FCC Chairman Tom Wheeler warned against attempts to "gut" the agency, including by moving core telecom oversight functions to the FTC. He also defended the commission's actions on net neutrality, broadband reclassification, privacy, zero rating, the incentive auction, USF changes and other issues. He was interviewed on C-SPAN's The Communicators (scheduled to air Saturday and Monday and posted here), the latest in a series of exit interviews and farewell appearances (see 1701190069 and 1701130064) before Donald Trump's inauguration as president on Friday, Wheeler's last day at the agency.
Rural telco officials met with commissioner aides to discuss Lifeline USF issues in their petition for reconsideration, one of many pending (see 1606240077 and 1608010028). NTCA and WTA welcomed FCC clarification of high-cost carrier stand-alone broadband Lifeline duties in response to another petition seeking a temporary waiver, which was dismissed as moot (see 1701090031), but said more needs to be done. "Resolution of the items raised in the Petition for Reconsideration is critical to a stronger Lifeline mechanism that better serves low-income consumers and limits the administrative burden of participating in the program for the small businesses that NTCA and WTA represent," the groups said in filings (here, here and here) posted Tuesday in docket 11-42 on meetings with aides to Commissioner Ajit Pai, Michael O'Rielly and Mignon Clyburn.