NARUC, Others Duel on USF Revamp Priorities, in Senate Filings

Three telecom policy stakeholder groups urged Senate Communications Subcommittee leaders Friday to include stronger accountability rules in USF revamp legislation but diverged on some other goals. The entities were responding to a late July feedback request from Communications Chairman Ben Ray Lujan, D-N.M., ranking member John Thune, R-S.D., and other USF working group members for feedback on the path forward on legislation (see 2305110066). FCC Chairwoman Jessica Rosenworcel, meanwhile, is pushing back against criticisms from House Commerce Committee Chair Cathy McMorris Rodgers, R-Wash., and Senate Commerce Committee ranking member Ted Cruz, R-Texas, of the agency's Learning Without Limits proposal to allow E-rate program money to pay for Wi-Fi on school buses and for hot spots (see 2307310063).

NARUC believes “evolution of the USF mechanism must build on the existing coordinated State and Federal approach outlined in the current law to, among other things, assure the integrity of those States that have their own state high cost and broadband subsidy or support programs that predate the Infrastructure Investment and Jobs Act.” A revamp “of the contribution mechanism supporting the FCC USF programs is long overdue and” a 2019 “proposal from the State members of the Federal State Joint Board on Universal Service … is a useful place to start,” NARUC said. The Joint Board members asked the FCC to expand its USF contribution base to include a fee on internet access service (see 1910150045).

NARUC and the Free State Foundation delivered opposite messages about the future of the state-level eligible telecom carrier designation process. Congress should “expand, not eliminate” the ETC “designation procedure to prevent fraud and abuse in the program,” NARUC said. Congress should “eliminate the partial bypass” of the ETC process it enacted when it created the emergency broadband benefit program that preceded the FCC’s affordable connectivity program (ACP) “and in any case specify that State commissions retain authority to audit service subsidized by federal USF programs and handle consumer service complaints.” FSF wants Congress to outright eliminate the ETC requirement. The ETC rules included in the 1996 Telecom Act “are vestiges of the legacy voice-specific paradigm in communications policy,” FSF said. “Those requirements do not serve any constructive purpose in 2023, but instead discourage broadband providers from participating in USF program.”

The Wireless ISP Association wants Congress to continue funding ACP, which got GOP scrutiny this year (see 2306210076), but also urged lawmakers to “learn from some of the shortcomings” in the existing federal universal service apparatus. NTIA “has imposed unnecessary and inexplicable restrictions” as part of its implementation of the broadband equity, access and deployment (BEAD) program “on who can participate and where funds will be available,” WISPA said. “Congress should take immediate action directing NTIA to issue a supplemental” notice of funding opportunity for the program “that eliminates these restrictions, allows more broadband providers to qualify for BEAD funding, and protects private investment from government-funded overbuilding of existing broadband networks.”

Any USF legislative revamp “should ensure that the FCC adopts implementing rules pursuant to the requirements of the Administrative Procedure Act,” WISPA said. “Congress should enact legislation removing” IIJA-enacted language exempting BEAD from both APA and the Freedom of Information Act. Lawmakers should also “establish clear goals and metrics to determine the effectiveness and success of USF programs” given that the FCC’s annual Telecom Act Section 706 “inquiries do not establish clear deployment, access, and adoption goals, but rather evaluate broadband speed and use that as the primary, if not sole, determinant of whether advanced telecommunications capability is being provided to all Americans in a reasonable and timely fashion,” WISPA said.

FSF suggested Congress reduce annual USF funding “in light of the significant improvements in broadband access enabled by recent massive congressionally-appropriated subsidies” in IIJA and other measures. Those “subsidies address existing gaps in deployment.” FSF said. “Instead of assessments on” ISPs “that are passed through to consumers, any necessary future universal service subsidy funding should come from direct congressional appropriations.” The group called for lawmakers to widen the USF contribution base so it “includes, in some way, major web platform providers,” in line with proposals from FCC Commissioner Brendan Carr (see 2105240037) and some lawmakers.

FSF proposed lawmakers should make USF “consist exclusively, or at least primarily, of a voucher or voucher-like program for low-income individuals to obtain access from participating broadband providers of their choice” and cited ACP as “a good model” for a program that could outright replace Lifeline. Congress should “consider moving the eligibility threshold closer to the federal poverty line to make the program more fiscally sustainable so that it serves those low-income persons truly in need,” FSF said. Capitol Hill “should implement additional safeguards to prevent waste, fraud, and abuse,” including the FCC to “conduct a direct inquiry into a broadband subsidy applicant's legal, technical, and financial fitness prior to entrusting it with USF funds.”

Rosenworcel defended her E-rate NPRM against claims from Rodgers and Cruz that Communications Act Section 254 doesn’t allow the FCC to use program funding for off-campus services. Congress “recognized in Section 254(c)(1)” that “technology needs are constantly evolving in light of ‘advances in telecommunications and information technologies and services,’” she said in letters to the GOP leaders released last week. “Congress also clearly provided the Commission with the flexibility to update the E-Rate program to meet these changing technological needs” by giving the commission “the authority to 'designate additional services' to benefit schools and libraries in Section 254(c)(3).”

The NPRM “is consistent with the Commission’s recent exercise of its” Section 254(h)(2)(A) authority to “establish the Connected Care pilot program,” in which the FCC “found that providing support for patients’ home broadband connections expanded health care providers’ ability to serve more patients through the program, thus enhancing eligible health care providers’ access to advanced telecommunications and information services,” Rosenworcel said: “Furthermore, the proposal in the Notice is consistent with agency precedent dating back more than 25 years that concluded that both the E-Rate and Rural Health Care programs in Section 254 may include support for equipment necessary to facilitate access to internet service.”