Price cap ILECs are concerned that the FCC...

Price cap ILECs are concerned that the FCC might recommend an increase in the broadband speed requirement for Connect America Fund Phase II buildout (CD April 8 p1), without recommending concurrent changes in other terms for areas where carriers can elect cost model-based support, USTelecom and member ILECs told agency officials last week (http://bit.ly/1nn3HKG). The commission should “postpone commencement of a challenge process” to determine Phase II eligible census blocks until it decides on the speed requirements, USTelecom said. Any increase in speed requirements should also come with a revised 10-year term of support, USTelecom said, which would be “consistent with the substantially increased costs of deploying a higher-speed network.” Currently, Phase II support would be distributed over a five-year period. To the extent the agency proposes to increase the broadband public interest obligations by requiring high-cost eligible telecom carriers to offer high-speed broadband to schools and libraries, “such obligations should apply only to CAF II recipients who knowingly accept or decline funding with the associated obligations,” USTelecom said. Applying new obligations to ETCs who get legacy frozen support is “totally arbitrary,” it said. USTelecom also expressed concern about the schedule for phasing in the local rate floor. “The proposed $3.00 increase to be implemented January 2, 2015, followed 18 months later by another increase in excess of $3.00 will create rate shock among consumers and exceeds the threshold established in several states for the level of local rate increases that can be implemented without time-consuming and expensive state rate cases,” it said.