FCC violation

The hits just keep coming for LTD Broadband. The FCC late last week proposed over $21.7 million in fines for the provider relating to the provider’s defaults in the Rural Digital Opportunity Fund (RDOF) auction.

The commission also proposed $732,000 in fines for Etheric Communications involving RDOF defaults.

Proposed LTD Broadband Fines

The same day that the FCC proposed the fines against LTD, the commission denied an application filed by the company asking the commission to reverse its decision not to approve the company’s winning bid in the RDOF auction.

The program awarded funding to bring broadband to homes and businesses lacking service. Funding for an area was tentatively awarded to the provider that committed to deploying broadband to unserved areas for the lowest level of government support.

LTD was the largest winning bidder in the RDOF program and was slated to take home over $1 billion until the FCC decided not to approve the company’s long-form application. The commission said LTD had not demonstrated that it could meet its buildout commitments and therefore was in default.

Even before the FCC made that decision, it proposed a $2.3 million fine against LTD for failing to meet the deadline to obtain eligible telecommunications carrier (ETC) status in two states – a requirement for the RDOF program.

In opting not to reverse the decision to reject LTD’s long-form application, the FCC said that it had appropriately denied LTD’s application. The commission rejected LTD’s arguments that the commission did not apply the correct standard of review, that the review lacked standards and guidelines, and that the commission should have tailored LTD’s winning bids to areas that the company could potentially serve.

The commission rejected Etheric’s long-form application because the provider did not receive required ETC status. Therefore, Etheric was in default, the FCC said.

RDOF rules call for fines against winning bidders that default on their bids.

“By defaulting on their bids, these applicants hindered the disbursement of funds that could have otherwise been expended for the advancement of broadband access across primarily rural areas in the United States,” the commission said in proposing the fines.

It’s worth noting that the commission has received considerable criticism for not reviewing long-form applications prior to the RDOF auction instead of after the auction.

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