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States Take Aim at USF and ICC reform

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WASHINGTON December 8, 2011 – Wednesday TheHill.com reported that the Pennsylvania Public Utility Commission filed suit against the Federal Communications Commission for it’s Order and Further Notice of Proposed Rulemaking to reform the Universal Service Fund and Intercarrier Compensation regime.  The suit, filed in the 3rd Circuit, alleges that the FCC order is “arbitrary and capricious” and that it violates the 10th amendment by compromising the powers of the state commissions.

Core Communications a small telephone company has also filed suit.  Apparently any group seeking to block the FCC’s Order must file by December 9th.

It has been a number of weeks since the FCC released their Order and FNPRM.  Right after the October Commission meeting where the Executive Summary was released, a majority of stakeholders generally praised the reform efforts.  There were a couple complaints from a number of companies, consumer advocates and state utilities, but since then there has been relative silence.

In their October press release, by the National Association of Regulatory Utility Commissioners (NARUC) stated that they were pleased with “the proposal to prevent traffic pumping and eliminate inefficient fund disbursements,” and appreciated the FCC’s acknowledgement of the role that States play regarding carriers of last resort and “Eligible Telecommunications Carrier”(ETC) designations.

NARUC hinted at some disappointment by adding, “We and many of our members have a number of concerns about preemption of State authority in other aspects of today’s decisions. Some elements raise a host of unanswered legal and procedural questions but also the specter of unintended consequences for consumers.”

In a phone conversation with Commissioner Anne Boyle from the Nebraska Public Service Commission last month, the Commissioner would not mention whether her state was gearing up to challenge the FCC order but did express disappointment in the one size fits all formula for intrastate rates threatened by the intercarrier compensation reform.  In general she felt that the states did not have a fair seat at the table in the drafting process.

As mentioned above the states were not upset with many of the broader provisions of the Order. They appreciated that only ETCs were eligible for Phase II competitive bidding support under the Connect America Fund.  Additionally the $300 million allocated yearly to the Mobility Fund  Phase I will be limited to ETCs in order to deliver support for wireless infrastructure to under-served and unserved areas.

In its effort to reestablish the Connect America Fund as one that supports deployment of broadband, the Order also places a number of new requirements on ETCs.  ETCs will be required to offer stand alone voice services throughout their area at rates that are comparable to urban rates.  The FCC adjusted the definition of “voice telephony services” to allow for voice services to be delivered through VoIP.  Furthermore, ETCs receiving support under the current High Cost fund, it will be required to offer broadband in their supported areas.  These are serious requirements that mandate, services must meet the basic designated broadband speed set by the FCC and must be able to support services like VoIP.  Finally the FCC has instituted a series of reporting obligations for ETCs that reflect their broadband obligations.

These are some serious new requirements that will be levied on the state designated carriers.

The part of the FCC Order that impedes the most on traditional State authority is the ICC reform.  This reform begins by capping the Local Exchange Carrier’s (LECs) interstate and intrastate rates.  This cap is effective immediately.  The FCC has adopted a bill-and-keep model as the national framework for intercarrier compensation that will eventually phase down termination charges to zero.  By 2013 all intrastate access rates will be brought down to interstate levels.  The total phase down for large carriers is scheduled for 2018 while smaller carriers have until 2012.

This section of the order also sets new rules for intercarrier compensation with respect to VoIP. All VoIP calls whether interstate or intrastate will immediately be subject to the interstate access charges.

In an effort to compensate the incumbent local exchange carriers for their lost termination revenues under the ICC reforms, the FCC will allow ILECs to impose monthly fees on end user customers.  State Commissions and consumer interest groups have disapproved of this measure and share similar concerns that this is not the time to be raising prices for the average American.

The FCC caps what they call Access Recover Charges (ARC) at 50 cents a year for residential and $1.00 for multi-line businesses. The Order does not establish any recovery for Cable Local Exchange Carriers (CLECs) because they are not subject to government regulation when it comes to raising end user rates. This raises a whole new set of issues and questions about disagreements between various stakeholders.

Now that we have been through roughly 700 pages of the FCC’s Order and FNPRM, Broadband Breakfast plans to follow up with summary and analysis of the document along with comments and opinions from a number of the stakeholders themselves.

As Deputy Editor, Chris Naoum is curating expert opinions, and writing and editing articles on Broadband Breakfast issue areas. Chris served as Policy Counsel for Future of Music Coalition, Legal Research Fellow for the Benton Foundation and law clerk for a media company, and previously worked as a legal clerk in the office of Federal Communications Commissioner Jonathan Adelstein. He received his B.A. from Emory University and his J.D. and M.A. in Television Radio and Film Policy from Syracuse University.

FCC

Federal Communications Commissioner Brendan Carr Optimistic About Finding Common Ground at Agency

Samuel Triginelli

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Screenshot of FCC Commissioner Brendan Carr from C-Span

March 24, 2021 — Federal Communications Commissioner Brendan Carr said the regulator has since 2017 seen what he wanted: Broadband speed increases and lower prices.

“The approach we adopted in 2017 is working,” he said at the Free State Foundation’s 13th annual telecom policy conference on Tuesday. “Speeds have increased, prices are down, and we see more competition than ever before; we need to keep it that way,” he said, stressing the importance of reinforcing the good work the previous administration did and continues to do.

Carr, who has been a part of the FCC since 2012 in various capacities and through different compositions, said the transition into the new administration is going well.

In contrast to before, when it seemed as though the “sky was falling” and there were many problems with net neutrality, today’s reality is quite different, thanks to Acting Chairwoman Jessica Rosenworcel, he said.

The chairwoman contacted him almost immediately after she asked him to participate an event together on telehealth. There have been a lot of conversations and compromises since that moment, he said.

He said elections do bring some consequences, and undoubtedly have shaken some of the agency’s previous standards with a different party in leadership. However, he said the FCC has been finding common ground, something that “has been all too rare in the past couple of years.”

He added that, in 2016, experts and analysts weren’t painting a very rosy picture for the US future leadership when it comes to 5G. One of the primary reasons cited was the cost and length of time to build out the Internet infrastructure in this country, he said.

“We went from 708 new cell sites in 2017 to over 46,000. The progress is astounding, and not only with towers but with fiber, as we built 450k miles of fiber in just one year alone.”

Spectrum auctions driving the agenda, Carr says

Optimistic on spectrum, he pointed out that at present, there is a lot of it available. “In 2017, the FCC had previously voted in a lot of higher band spectrum options.”

The work of initial prioritization was completed by us before 2017 when we moved in and noticed the lack of midband spectrum in the pipeline. We had to move fast, and we had the first auction for the midband in 2020, with frequencies ranging from 3.5 to 5.5 gigahertz.

Over the last couple of years, he said the FCC has opened that band to intensive use, pushing the midband spectrum a great deal. The future holds the need to create a spectrum calendar with a rough outline of spectrum auctions, including which bands are available for auction and when, he said. “I have already filled in that calendar.”

He said the regulator’s challenge is not with a lack of communication but with coordination.  “We need the FCC to take a step back and consider the public interest, how the agency can best achieve the federal missions and how it can best do this. Even if there are going to be disagreements, it is paramount to ensure that the American economy stays competitive.”

Looking ahead, Carr said the 5.9 gigahertz project, which last year was on trial to expand rural broadband access, would be a great beginning to prove that good leadership and compromise are possible between both parties.

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The $3.2 Billion Emergency Broadband Benefit Program: What’s In It, How to Get It?

Tim White

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Pool photo of FCC Acting Chairwoman Jessica Rosenworcel by Jonathan Newton

March 5, 2021 – Just shy of the 60-day deadline set by Congress, the Federal Communications Commission adopted an order on February 25, detailing how the new Emergency Broadband Benefit Program would work.

The $3.2 billion program was part of the Consolidated Appropriations Act of 2021 that passed Congress in December 2020 and is allocated to the FCC to help low-income households with broadband access during the COVID-19 pandemic.

Broadband Breakfast Live Online will focus on the program on Wednesday, March 10, 2021: “The Emergency Broadband Benefit: How Will the $3.2 Billion Program Work?

The funding will provide up to $50 per month for eligible low-income households, increased to $75 per month for those living on native tribal lands. Rather than disbursing directly to consumers, the funds will be distributed to participating broadband providers, who in turn will grant the discounted internet access to qualifying households who apply.

The Emergency Broadband Benefit program is not to be confused with the Emergency Connectivity Fund currently being considered by Congress.

The Emergency  Broadband Benefit program also has a one-time reimbursement option of $100 for purchasing desktops, laptops or tablets for connecting to the internet, with a co-pay of between $10 and $50.

Households do not receive the reimbursement for buying a device separately: That is provided by the service providers through which the funding will be disbursed.

To qualify for the program, households must meet one of the following criteria:

  • Qualifies for the FCC Lifeline program
  • Is approved for the free or reduced-price school breakfast/lunch program
  • Demonstrates substantial documented loss of income since February 29, 2020
  • Received a federal Pell grant in the current award year
  • Qualifies for a participating provider’s existing low-income or COVID-19 relief program, subject to FCC approval.

To receive reimbursement for services and connected devices, participating service providers must register with SAM.gov, cannot be listed on the Department of the Treasury’s “do not pay” list, and must register with the FCC to receive a registration number. Similar to the Lifeline program, the EBBP will be provided to companies who participate through the Universal Service Administrative Company.

To participate, companies are not required to be eligible telecommunications carriers through Lifeline, but must apply through an “election notice” with USAC. They must also get prior approval from the FCC before filing their notice.

The application window for service providers to apply to the program opens on Monday, March 8, 2021, and ends March 22. The program should begin approximately April 25, or 60 days after the FCC published the order.

The service provider’s broadband plan must have been in place by December 1, 2020, to receive the discounted rate.

Unlike the FCC’s Lifeline program that has been in place for several years, this new funding is temporary and set to expire, either when the $3.2 billion are exhausted or six months after the Health and Human Services secretary declares that COVID-19 is no longer a health emergency.

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FCC

What You Need To Know About the More-Than-$7 Billion Emergency Connectivity Fund

Derek Shumway

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Photo of Kamala Harris proceeding to break the deadline on coronavirus relief deliberations from the Los Angeles Times

March 5, 2021 – The Senate on Thursday voted to begin debate on the $7.6 billion Emergency Connectivity Fund, which is part of the House-passed $1.9-trillion coronavirus stimulus bill.

Most of the 591-page bill adheres closely to what President Biden called for in his relief proposal in January 2021, as reported by CNN. The $7.6 billion Emergency Connectivity Fund includes funds for internet service, hot spots, and other devices to use at home. The larger coronavirus bill includes new rounds of stimulus checks, unemployment assistance, and healthcare support.

This comes after a coalition of education advocates in January 2021 petitioned the FCC to add in a provision for emergency E-rate funding. On Feb. 9, 2021, House Energy and Commerce Chairman Frank Pallone, D-N.J., announced the provision as part of the committee’s legislative recommendations for the COVID budget reconciliation legislation. The Federal Communications Commission would be tasked with implementing the $7.6-billion fund.

The potential fund of more than $7 billion fund in this Emergency Connectivity Fund is not to be confused with the Emergency Broadband Benefit Program, a new pot of broadband money allocated by the consolidated appropriations bill passed in December 2021.

Broadband Breakfast Live Online will focus on that other program on Wednesday, March 10, 2021: “The Emergency Broadband Benefit: How Will the $3.2 Billion Program Work?

The magnitude of the pandemic has sent schools scrambling to connect students to virtual learning. The Emergency Connectivity Fund would help connect some more than 15 million children and as many as 400,000 teachers, according to Common Sense and Boston Consulting Group.

But passage of the additional more-than-$7 billion in funding is not assured. Even to begin debate on the broader coronavirus relief package, Vice President Kamala Harris had to cast a tie-breaking vote because the Senate is even split with 50 senators who caucus with the Democrats and 50 Republicans.

Major tech priorities included in an earlier Senate draft of the bill appear unchanged in the official version of the bill introduced to the Senate yesterday. Funding for the Emergency Connectivity Fund is part of larger funding for the Technology Modernization Fund, as well as for the Cybersecurity and Infrastructure Security Agency and other proposals.

President Biden originally proposed $10.2 billion of funding for the modernization fund and cybersecurity, but the Senate’s version includes just $1 billion. Additional, the Senate’s version includes  $7.17 billion for the Emergency Connectivity Fund, which was reduced by more than $400 million from the original $7.6 billion proposed figure.

Still, the fund represents the a very large tech investment to support broadband capabilities and remote learning in schools.

As Broadband Breakfast noted on Monday, the Emergency Connectivity Fund, previously signed into law in December 2020, secured $3.2 billion to expand broadband coverage to underserved communities and households in need. This internet service discounts of up to $50 per month for eligible consumers and up to $75 per month for those on tribal lands. Additional discounts on a computer or laptop device are also included.

As reported by MeriTalk, getting the Senate to bring its version of the $1.9 trillion stimulus bill to a vote later this week is imperative, as both chambers are pushing to get the bill signed into law before March 14, when some unemployment assistance programs will expire.

Presuming the Senate passes its version of the bill, it goes back to the House for a vote and then onto the White House for President Biden’s final signature.

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