rural setting

The FCC said today that it is ready to authorize Rural Digital Opportunity Fund support for Charter Communications for deployments in over 20 states. Also appearing on the RDOF ready-to-authorize list released today are over 20 companies that tentatively won smaller amounts of funding in the auction. 

The ready-to-authorize list released today includes bids totaling $1.2 billion, the majority of which belong to Charter.

Also today, the FCC released what it is calling the Rural Broadband Accountability Plan, which details the commission’s plans to enhance accountability for RDOF winners and other recipients of Universal Service Fund (USF) high-cost support.

Finally, the commission released a list of defaulted RDOF bids and outlined its plans for fining companies that defaulted. 

Ready to Authorize

Charter was one of the largest winning bidders in the RDOF auction and was in line to receive support totaling $1.2 billion to cover some of the costs of deploying broadband to unserved rural areas. The full amount that the company will receive will be less than that, however, as the company said it would not pursue deployments in a comparatively small percentage of the census blocks for which it was tentatively awarded funding.

The defaulted bids list is comprised, in large part, of bids for census blocks that were questioned by third parties who argued that the census blocks already had broadband service available to them. The FCC last year sent each winning bidder a list of census blocks that had been questioned and invited the bidders to advise the commission if they did not intend to pursue deployments in those blocks.

At that time, the commission said it would reconsider the penalties initially planned for defaulted bids.

According to a public notice released today, companies defaulting on bids will be subject to a base forfeiture per census block group of $3,000. However, the commission said it would limit a winning bidder’s total base forfeiture to “15% of the bidder’s total assigned support for the bid for the support term.”

The commission added that “[n]ot withstanding this limitation, the total base forfeiture will also be subject to adjustment upward or downward based on the criteria set forth in the commission’s forfeiture guidelines.” The public notice also notes that winning bidders that failed to submit audited financial statements by the required date would be subject to a base forfeiture of $50,000, which could be adjusted upwards or downwards.  

On the default list along with Charter are more than a dozen winning bidders, including another large winning bidder LTD Broadband, whose defaulted bids comprise the majority of the 46-page list.

The top 10 winning bidders in the RDOF auction comprised about three quarters of the $9.2 billion tentatively awarded in the auction. Charter is rather unique among those top winning bidders in being deemed “ready to authorize.” Most of the others, including LTD Broadband, are still waiting to appear on a ready-to-authorize list.

Companies on the ready-to-authorize list released today have until February 11 to provide the FCC with letters of credit and bankruptcy opinion letters. After the FCC reviews and approves those letters, a company’s RDOF funding is released to the company.

Rural Broadband Accountability Plan

The FCC’s RDOF oversight plans don’t end when a company is approved, however.

According to the Rural Broadband Accountability Plan released today, the commission will increase audits, verifications and transparency for RDOF and other USF high-cost support recipients. 

Details include doubling the number of audits and verifications in 2022 compared to 2021 and including on-site audits as well as audits and verifications based on random selection. In addition, USAC will conduct more verifications prior to a program’s first required deployment milestone.

Large dollar and higher-risk recipients will be subject to an on-site audit in at least one state and higher-risk recipients will be subject to additional audits and verifications. The FCC did not detail how it would define a “higher-risk” recipient. 

The commission also said that results of verifications, audits and speed and latency performance testing would be made public on the USAC site.

A complete list of RDOF winning bidders newly deemed ready-to-authorize is available at this link.

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