Industry Groups Plea for Funding to Address Secure Network Shortfall

WASHINGTON, January 11, 2024 – A group of nine wireless and wireline trade groups on Thursday urged Congress to allocate an additional $3.08 billion in funding for providers to comply with a 2020 law, mandating the replacement of some foreign-manufactured equipment in U.S. communications networks.

In a jointly-written letter, spearheaded by the Competitive Carriers Association,

the groups argue the reimbursement program designed to fund equipment replacement efforts is significantly underfunded, and say without full financial support many providers could be stranded mid-effort.

The Federal Communications Commission, responsible for overseeing the program, granted approval for $4.98 billion in applications seeking funding from the Secure and Trusted Communications Networks Reimbursement Program in July 2022, but was compelled to prorate funds, providing 39.5 percent of reasonable costs upfront.

However, this approval revealed a significant overcommitment from the $1.9 billion appropriation for the program assigned by the Consolidated Appropriations Act of 2020.

With deadlines for providers to remove all Huawei and ZTE communications equipment from their networks ranging from October 8, 2023 to September 23, 2024 – the associations implore Congress to promptly allocate full funding.

An FCC bureau granted several six-month extensions to eligible communications providers in October 2023, due to what the FCC recognizes as a lack of funding slowing the removal, replacement, and disposal processes.  

In an October letter addressed to Rep. Frank Pallone, ranking member of the House Energy & Commerce Committee in October, FCC Chairwoman Jessica Rosenworcel emphasized that “the grant of these extensions does not lessen the urgency for a fully funded reimbursement program.”

The trade organizations argue that following the guidance of Congress and the FCC, carriers initiated the “rip and replace” procedure to eliminate such equipment, with the expectation of full reimbursement.

In a report to Congress last Friday, the Federal Communications Commission says just a handful of telecommunications companies has finished removing tech equipment supplied by companies considered to have close ties to China’s Communist government.