The uSF program has been the subject of reform for more
than a decade. Starting in 2008 and continuing through 2016,
the Fcc considered (and reconsidered) how to reorient uSF
for a broadband world. unfortunately, much of the early
focus centered upon how to deliver minimal levels of broadband to unserved areas, ignoring both the need to sustain
existing networks and the fact that networks must evolve
to keep pace with user demand. For smaller operators, many
of these changes unfortunately translated to new cuts,
caps and constraints on uSF support as the commission
looked to provide “better incentives” for investment and
operations and to funnel money toward unserved areas.
In 2018, however, we saw a shift in direction. There were
elements of promise in the 2016 reforms that, for the first
time, reoriented support more toward broadband and gave
smaller operators options to receive uSF through other
models. These reforms fell short, however, because of a
severe lack of funding—as NTcA remarked often the past few
years, even the best rebuilt engine cannot work without gas.
To help with these concerns, in early 2018 the commission
provided a “shot in the arm” by granting NTcA’s petition for
reconsideration and infusing more than $500 million in incremental uSF support. While a huge victory for rural America,
these funds still represented only a “down payment” on the
amount needed to fulfill the mission of universal service.
Fortunately, policymakers recognized that this funding,
while substantial, was only partial and interim in nature.
We therefore saw nearly 200 members of congress write to
the commission only weeks after the additional $500 million was provided, urging it to fill the remaining uSF budget shortfalls on a more complete basis. Fcc chairman Ajit
pai, in turn, issued a statement in mid-2018 expressing
similar concerns as the new budget controls kicked in and
imposed even deeper levels of pain.
NTcA has continued to lead the charge for sufficient
and predictable funding, and these efforts are poised to
deliver greater success. In the face of continued requests
from capitol Hill for resolution of uSF budget concerns, the
Fcc approved an order in December that will override existing budget controls and provide levels of additional funding aimed at enabling deployment of higher-speed networks
and sustaining the uSF programs for years to come. NTcA
will continue working to confirm that the order works as
intended and delivers on the promise of universal service
for the millions of rural Americans served by small telcos,
but we believe this watershed decision should put the high-cost programs on more solid foundation in 2019 and beyond.
Even if uSF budget concerns can be addressed and
resolved for a series of years, certain implementation details
remain critical to resolve. For example, NTcA has filed for
review of certain decisions with respect to verification of
performance on uSF-supported networks. NTcA is aiming
to strike a balance between ensuring workable testing
requirements while avoiding the prospect of less robust
networks receiving uSF support for substandard perfor-
mance. Similarly, NTcA continues to consider how provid-
ers will map coverage information critical to determining
where uSF support is needed, seeking to balance reporting
burdens with concerns about overstated service capabilities.
Although intercarrier compensation (Icc) has not gained as
much attention as other regulatory issues in recent years, it
remains an important component of universal service. NTcA
led the successful charge in 2011 to protect transport rate
elements most important to establishing financial responsibility for the costs of getting traffic to and from rural America.
We have seen a renewed attack, however, with certain
parties (and even the commission itself) exploring how to
move the remaining Icc rate elements to “bill and keep.”
NTcA has worked with other stakeholders to fend off thus
far a comprehensive set of reforms, but the commission is
still evaluating how to address several discrete “arbitrage”
practices. As this debate unfolds in 2019, NTcA’s focus
continues to be upon:
l Defining carefully and then closing through surgical
measures those clear arbitrage loopholes that undermine
the integrity of the Icc system.
l Obtaining alternative cost recovery if any reforms
reduce Icc rates—but without squeezing already insufficient high-cost uSF budgets.
l Ensuring that transport responsibilities are not altered
in a manner that would foist upon rural consumers the full
cost of interconnecting with consumers across the nation
and the globe.
For the past few years, there has been a buzz around the prospect of a package of funding, streamlining efforts and tax
incentives to promote infrastructure deployment, including
broadband networks. Broader political debates and other
policy priorities, however, have stalled any comprehensive
initiative. Still, more targeted efforts to promote broadband
deployment have progressed, most notably in the form of
congressional appropriations made available through the
Rural utilities Service and permitting relief efforts in the
form of enacted laws and commission activity.
NTcA has been involved at every level of these debates
thus far. From having secured the first communications
industry witness spot at a Senate infrastructure hearing in
early 2017 to assuming a leadership role within the Rebuild
Rural coalition of rural and agriculture-focused stakeholders,
NTcA has sought from the start to ensure that its members
“have a seat at the table,” and this has continued through
NTcA’s participation in working groups of the Fcc’s Broadband Deployment Advisory council and support for the afore-