During the 30th anniversary of the Telecommunications Act of 1996, the Federal Communications Commission (FCC) has begun a review of one of the most consequential provisions of the Act — the Commission’s Universal Service Fund (USF). Chairman Brendan Carr says the FCC has begun looking for ways to update each USF component.
“Up to now, you’ve seen some efforts on Lifeline, which is the low-income subsidy program. We’ve been working hard on waste, fraud, and abuse there,” Carr said during USTelecom’s recent online American Connectivity Forum. “We’re taking one step this month on the E-Rate [Schools and Libraries] program, and I think soon you’ll see us taking a broader top-to-bottom look at the E-Rate and the high-cost program as well.”
USTelecom President and CEO Jonathan Spalter, who interviewed Carr during the Forum, expressed the special need for changes to the high-cost program, “which has been such an indispensable part of how, particularly our rural facing providers have been able to deliver connectivity.”
The high-cost fund began life after the 1996 Act as a program to assist rural carriers maintain existing telecommunications facilities and ensure affordable rates in low-population areas. Under the National Broadband Planearly in the Obama Administration, the FCC changed the focus of the USF high-cost program away from operating copper networks to broadband network construction.
With much of the task of building broadband to rural America complete, some would like to see USF return to operations and maintenance.
Universal Service, said forum panelist Todd Foje, CEO of Great Plains Communications, must be more than infrastructure construction. “It needs to be cared for and fed over time, through maintenance and upgrades and things like that. There’s an operating aspect to what we do that also needs to be front of mind for policymakers,” he said.
Beyond USF, other top FCC priorities Carr mentioned included the need to hasten the pace of legacy copper network replacement and permitting reform to remove delays to network construction, especially in rural areas.
Completing the transition from copper to fiber will save the telecommunications industry billions of dollars annually. At the same time, Carr agreed that there are
interconnection issues to resolve during the transition.
“We’re opening up a series of workshops at the FCC to bring together all of the affected stakeholders — ILECs, CLECs, associations, any other groups as well — to make sure that we can work through,” Carr said. “We understand we’ve got to be sensitive around the edges, but directionally, we have to complete this transition.”
On the permitting front, Carr noted the steps the FCC has taken, but often there are few direct actions the FCC can take to speed up local permitting.
Jeff England, VP and CFO of Silver Star and chairman of USTelecom’s board described how long permitting processes are becoming a difficult issue, especially for carriers in Western states. Federal grant programs come with hard start dates and construction deadlines, and missing them comes with stiff penalties.
“So, I’m faced with situations in my service area where it literally can take two years to get a permit. In Wyoming, I have snow on the ground for six months out of the year, which means that for the remaining three years, I’m only getting about a year and a half to get the project done,” England said.
