Washington Monitor
Volume XVII, No. 7 April 15, 2009

RCA FILES COMMENTS WITH NTIA, RUS AND FCC REGARDING BROADBAND STIMULUS GRANT AND LOAL PROGRAMS

On April 13, RCA filed comments with the NTIA and RUS on the Joint Request for Information (“Joint Request” or “JRI”) issued by the National Telecommunications and Information Administration (“NTIA”) and the Rural Utilities Service (“RUS”) regarding the NTIA Broadband Technology Opportunities Program (“Broadband Program” or “BTOP”) and the RUS broadband grant and loan programs.

In its comments, RCA noted that expanded and accelerated broadband deployment throughout rural America (in which many unserved and underserved areas are located) is critically important, and Recovery Act funding provides an opportunity to ensure that consumers, governments, and businesses, as well as educational, public safety, health care, and other institutions throughout rural America have greater access to broadband services.

RCA stated that the focus of NTIA and RUS on jobs and economic development should not detract from each agency’s efforts to utilize funding made available by the Recovery Act in the most efficient and effective manner possible to improve broadband access in rural communities.  RCA also noted that the goals of job creation and expanded deployment of broadband are not mutually exclusive, since studies have shown a direct correlation between broadband penetration and job creation.

RCA proposed that priority be given by NTIA and RUS, in the allocation of grants and loans, to projects designed to deploy broadband infrastructure in unserved and underserved areas.  RCA stated that NTIA and RUS will face other critical decisions in seeking to ensure the success of the their funding programs, including weighing the statutory criteria for grant awards, defining the areas in which funded projects will deploy broadband infrastructure, and determining the levels of transmission speed that will constitute broadband service for purposes of the funding pro-grams.

RCA advocated that NTIA and RUS define “unserved areas,” “underserved areas,” and “broadband service” in a way that moves rural areas toward parity with urban areas in having access to affordable broadband service that enables utilization of advanced applications and functionalities.  RCA stated that an effective way to pursue this goal is to define unserved and underserved areas based upon the levels of broadband service speeds currently available.  RCA noted that if these levels are selected accurately and reasonably, this definitional approach will facilitate the targeting of funding in a manner most consistent with the goal of universally available broadband.

RCA stated that broadband service should be defined in a way that distinguishes between wireless and wireline technologies, because this will serve the statutory purpose of ensuring that service providers using different categories of technology platforms all have an opportunity to compete for funding and will enable consumers in unserved and underserved areas to take advantage of the unique capabilities of mobile wireless broadband services.

In awarding grants and loans pursuant to BTOP and the RUS broadband grant and loan programs, RCA stated that NTIA and RUS should take into account the fact that mobile wireless broadband service providers are in the best position to deploy broadband infrastructure in rural areas quickly and efficiently, and to provide affordable broadband services to the widest population of subscribers in unserved and underserved areas.

RCA filed a separate set of comments with the FCC on its Public Notice seeking comment on the following five key terms and concepts contained in the American Recovery and Reinvestment Act of 2009 (“Recovery Act”): (1) the definition of “unserved area”; (2) the definition of “underserved area"; (3) the definition of "broadband"; (4) the non-discrimination obligations that will be contractual conditions of BTOP grants; and (5) the network interconnection obligations that will be contractual conditions of BTOP.  The positions taken by RCA in its comments filed with the FCC were also included in its comments to NTIA and RUS.

RCA recommended defining “unserved area,” in the case of wireless services, to mean any area in which no wireless service with a transmission capacity of at least 200 kbps (in at least one direction) is available.  RCA suggested defining “underserved area,” in the case of wireless services, to mean any area in which no wireless service with a transmission capacity capable of providing speeds of 1 Mbps (downlink) and 200 kbps (uplink) is available.  RCA noted that the downlink and uplink thresholds it proposed for wireless services are consistent with the transmission capabilities of many wireless carriers currently providing mobile services in rural areas and, therefore, setting these thresholds to define underserved areas would promote the Recovery Act’s objective of technological neutrality and participation of the widest array of service providers in the Recovery Act’s programs, because the thresholds would facilitate the eligibility of most rural carriers to compete for funding to deploy infrastructure and provide services in underserved areas.

RCA proposed that “broadband service” be defined, in the case of wireless services, as a service that is capable of providing speeds of 1 Mbps (downlink) and 200 kbps (uplink).  Under RCA’s proposal, a grant or loan applicant would be required to commit to the provision of services capable of performing at these speeds in both unserved and underserved areas.  Thus, even though an unserved area for wireless services would be defined as an area with no access to 200 kbps wireless broadband services, a wireless carrier would not be eligible for any funding unless the carrier committed to the provision of broadband services with transmission capacity capable of providing downlink speeds of 1 Mbps in the unserved area – a speed currently achievable by many mobile wireless service providers.

RCA also suggested that NTIA and RUS, in prescribing their rules for deciding whether a grant applicant has established eligibility to receive funding, consider inclusion of a waiver process pursuant to which an applicant could still be found eligible for funding even if the applicant could not warrant that it would deploy services with the minimum transmission speeds required by the definition of broadband service.

RCA suggested that NTIA and RUS use Census Tracts as the “building blocks” for designating areas in which grant or loan recipients would deploy broadband services. A grant applicant could propose any group or groups of contiguous Census Tracts as the area to be covered by the proposed project.  The applicant would be required to demonstrate or certify that the area qualifies as an unserved area or underserved area, as the case may be, because the defined level of broadband service is not available from any existing service provider in any of the Census Tracts comprising the area.  RCA explained that using Census Tracts as a component of the definition of “unserved area” and “underserved area” would be technologically neutral because it would not be based upon any pre-existing service areas used either by wireline or wireless carriers.  The use of Census Tracts would also help to target the deployment of broadband service at a very granular level.

RCA also noted that the non-discrimination provisions should follow the FCC’s Policy Statement but should not attempt to extend beyond it.  Any effort to develop more extensive or detailed requirements would be very controversial and would likely extend the period of time necessary for NTIA to prescribe the overall set of rules and requirements that will govern its administration of the Broadband Program.  RCA reasoned that given the fact that the Policy Statement has been a durable mechanism for preserving and promoting the interest of consumers in an open, interconnected public Internet, there is no persuasive reason to risk any such delay in the initiation of the grant program.  For the same reason, RCA noted its belief that it would be sufficient and effective to base network interconnection obligations on the existing statutory and regulatory framework.

HOUSE SUBCOMMITTEE ON COMMUNICATIONS, TECHNOLOGY AND THE INTERNET HOLDS BROADBAND STIMULUS OVERSIGHT HEARING

On April 2, the House Subcommittee on Communications, Technology, and the Internet held a hearing to examine issues related to the broadband programs created by the American Recovery and Reinvestment Act (“Recovery Act”).  The hearing examined the intentions of NTIA, RUS and the FCC to carry out the broadband programs established by the Recovery Act.  The witness list included: David Villano, Assistant Administrator, Telecommunications Program, Rural Development, Department of Agriculture; Mark Seifert, Senior Policy Advisor, National Telecommunications and Information Administration, Department of Commerce; Scott Deutchman, Acting Senior Legal Advisor, Federal Communications Commission; Rachelle Chong, Commissioner, California Public Utilities Commission; Nicol Turner-Lee, Senior Vice President, External Affairs, One Economy Corporation; and Brian R. Mefford, Chairman and CEO, Connected Nation.

As expected, the general consensus was that members of Congress viewed broadband access as critically important to both our nation’s ability to compete in the global market and our quality of life.  Congress also expressed their belief that the broadband programs developed from the Recovery Act could be transformative for our country and could provide a long-term economic boost.

Two main issues emerged from the hearing: (1) the need for the development of well-reasoned definitions of the key undefined terms “unserved” and “underserved”; and (2) the need for broadband mapping in order to allocate program funds wisely.  Members of the Subcommittee also indicated that they hoped to see continued coordination between NTIA, RUS and the FCC and trusted the agencies would adequately balance time constraints and costs.

The one marked divergence of views was with regard to program funding priority.  Republicans believed program funds should focus on unserved areas before underserved, because assisting underserved areas first could distort the marketplace.  Democrats, on the other hand, believed both groups were equally important and should be funded simultaneously because underserved rural communities face challenges that often go overlooked and it is vital to bring this community up to a level playing field.

FCC RELEASES NOTICE OF INQUIRY TO DEVELOP A NATIONAL BROADBAND PLAN

On April 8, the FCC released a Public Notice and Notice of Inquiry commencing the process of developing a National Broadband Plan with the stated goal of ensuring that every American has access to broadband capability.

In the American Recovery and Reinvestment Act of 2009 (“Recovery Act”), Congress directed the FCC to draft a National Broadband Plan.  According to the FCC, the National Broadband Plan "will provide a roadmap toward achieving the goal of ensuring that all Americans reap the benefits of broadband."

The Recovery Act requires the National Broadband Plan to explore several key elements of broadband deployment and use, and the FCC now seeks comment on these elements, including:

• The most effective and efficient ways to ensure broadband access for all Americans;
• Strategies for achieving affordability and maximum utilization of broadband infrastructure and services;
• Evaluation of the status of broadband deployment, including the progress of related grant programs;
• How to use broadband to advance consumer welfare, civic participation, public safety and homeland security, community development, health care delivery, energy independence and efficiency, education, worker training, private sector investment, entrepreneurial activity, job creation, and economic growth, and other national purposes.

Comments on the Notice of Inquiry are due June 8.  Reply comments are due July 7.

See A National Broadband Plan for Our Future, GN Docket No. 09-51, FCC 09-31 (rel. Apr. 8, 2009).

COMMISSION RELEASES NOTICE OF INQUIRY ON DISTRIBUTION PROCESS OF FEDERAL HIGH COST SUPPORT TO “NON-RURAL” AREAS

On April 7, the FCC released a Notice of Inquiry (NOI) seeking to refresh the record on how federal high-cost support is distributed to so-called “non-rural” areas.  The NOI was the result of a remand from the U.S. Court of Appeals for the 10th Circuit instructing the FCC to justify its universal service distribution methodology in non-rural areas for a second time.  The case was subject to a petition for a writ of mandamus seeking to force the FCC to act, however, the FCC agreed to commence proceedings with the goal of finishing a rulemaking by April 2010. Thus, the NOI gets the ball rolling on refreshing the record and figuring out which way the FCC should go next.

Ten years ago, the FCC said that support should be distributed using a forward-looking cost model, and it implemented a model for areas served by non-rural telephone companies (i.e., AT&T, Verizon, Qwest).  Following the court’s initial remand, the FCC sought comment from parties on ways to distribute funds, and it has published four of them in the NOI – one from Qwest, Embarq, CostQuest and a joint proposal from Maine and Vermont.

There are also other policy questions that the FCC seeks comment on, including some critical interpretations of certain terms that Congress used in the 1996 Act.

Comments on the NOI are due on May 8.  Reply comments are due June 8.

See In the Matter of High-Cost Universal Service Support, Notice of Inquiry, WC Docket No. 05-337, CC Docket No. 96-45, DA 09-28 (rel., Apr. 8, 2009).

COMMENT SOUGHT ON CORR WIRELESS APPEAL OF USAC’s DECISION NOT TO REALLOCATE VERIZON’S USF HIGH-COST PHASE-DOWN SUPPORT

On April 9, the FCC placed on Public Notice an appeal filed by Corr Wireless challenging Universal Service Administration Company's (USAC) decision not to reallocate the USF high-cost funding given up by Verizon (as a condition of the Alltel-Verizon Wireless merger order) in the pool of funds available for distribution under the interim cap.  Corr Wireless contends that USAC’s decision not to include universal service high-cost support funds disclaimed by ALLTEL and Verizon in connection with their merger last year in the pool of funds available for distribution under the competitive eligible telecommunications carrier (ETC) interim cap is incorrect.  Specifically, Corr argues that the Commission’s actions in the Verizon-Alltel Merger Order and the Interim Cap Order do not indicate that the funding disclaimed by the Verizon-Alltel merger is not to go back into the competitive ETC capped pool.

According to Corr Wireless’ appeal, because USAC "has erroneously given effect to what was nothing more than an assertion by Verizon in a merger proceeding instead of following the express directive of the Commission set forth in the Interim Cap Order, [USAC] should be directed to immediately include the high cost support that was received by ALLTEL and Verizon in the March 2008 funds calculation.  In addition, any other high cost support funds (such as those credited to Sprint or Nextel) which are not now being claimed should also be included in the pool of funds available for distribution under the cap.  Those funds should then be distributed to ETCs as provided by the interim cap formula. The Administrator should make this distribution effective for all calendar quarters after December 31, 2008."

Comments on Corr Wireless’ petition are due May 11.  Reply comments are due May 26.

See Comment Sought on Corr Wireless Communications, LLC, Request for Review of a Competitive Eligible Telecommunications Carrier High Cost Support Decision of the Universal Service Administrative Company, Public Notice, WC Docket No. 05-337, CC Docket No. 96-45, DA 09-805 (rel. Apr. 9, 2009).

UPCOMING REGULATORY DEADLINES

• April 20 – Comments due on Centennial Petition, WC Docket No. 05-337, CC Docket No. 96-45, DA 09-626 (rel. Mar. 19, 2009)
• April 20 – Comments due on GCI Petition, WC Docket No. 05-337, DA 09-628 (rel. Mar. 19, 2009)
• April 29 – Comments due on TracFone Wireless Petition for Rulemaking to amend the definition of Tier One federal Lifeline support, Report No. 2885, RM-11526 (rel. March 30, 2009)
• May 5 – Reply comments due on Centennial Petition, WC Docket No. 05-337, CC Docket No. 96-45, DA 09-626 (rel. Mar. 19, 2009)
• May 5 – Reply comments due on GCI Petition, WC Docket No. 05-337, DA 09-628 (rel. Mar. 19, 2009)
• May 8 – Comments due on Notice of Inquiry on federal high cost support to “non-rural” areas, WC Docket No. 05-337, CC Docket No. 96-45, DA 09-28 (rel. Apr. 8, 2009).
• May 11 – Comments due on Corr Wireless appeal of USAC’s decision not to reallocate Verizon’s USF high cost support, WC Docket No, 05-337, CC Docket No. 96-45, DA 09-805 (rel. Apr. 9, 2009).
• May 14 – Reply comments due on TracFone Wireless Petition for Rulemaking to amend the definition of Tier One federal Lifeline support, Report No. 2885, RM-11526 (rel. March 30, 2009)
• May 26 – Comments due on Corr Wireless appeal of USAC’s decision not to reallocate Verizon’s USF high cost support, WC Docket No, 05-337, CC Docket No. 96-45, DA 09-805 (rel. Apr. 9, 2009).
• June 8 – Comments due on National Broadband Plan Notice of Inquiry, GN Docket No. 09-51, FCC 09-31 (rel. Apr. 8, 2009).
• June 8 – Reply comments due on Notice of Inquiry on federal high cost support to “non-rural” areas, WC Docket No. 05-337, CC Docket No. 96-45, DA 09-28 (rel. Apr. 8, 2009).
• July 7 – Reply comments due on National Broadband Plan Notice of Inquiry, GN Docket No. 09-51, FCC 09-31 (rel. Apr. 8, 2009).

The Washington Monitor is published by the Rural Cellular Association (RCA). The Washington Monitor is not intended to provide legal or business advice and may, despite good intentions, contain errors and omissions.

Disclaimer: RCA members should determine the applicability of all Federal Communications Commission rules and policies, as well as other information contained herein, to their own operations and consult their own counsel as may be appropriate. RCA assumes no responsibility for errors or omissions in The Washington Monitor.

© 2009 Rural Cellular Association