Neb. PSC Prioritizes Ongoing Broadband Costs in State USF

Sustaining broadband networks is a “paramount objective” of the Nebraska Universal Service Fund (NUSF) high-cost program, especially with the "influx of federal and state deployment funding," the Nebraska Public Service Commission decided in a Tuesday order. Commissioners voted unanimously Tuesday for two orders on state USF changes (docket NUSF-139) and to consider sanctions against Windstream for three separate 911 outages (docket 911-076).

The first NUSF order considered issues of broadband sustainability and how to transition broadband deployment support (BDS) to a mechanism that supports ongoing costs, given the availability of federal and state broadband infrastructure grants like the broadband equity, access and deployment (BEAD) program and Nebraska Broadband Bridge Program (NBBP). The PSC said it anticipates issuing more orders and holding additional workshops and hearings on comprehensive NUSF distribution changes.

“Sustainability of broadband networks should be an explicitly adopted goal of the NUSF high-cost program,” the Nebraska PSC found. State laws require advanced telecom and information services across the state and say that NUSF should supplement federal USF, the commission noted: The 1996 Telecom Act envisioned an “evolving” USF that considered technology changes and the PSC likewise "has repeatedly recognized that its NUSF high-cost distribution mechanism must evolve with the needs of consumers.” The PSC disagreed with Charter Communications that adding the broadband sustainability goal would increase company burdens (see 2311200062). "Nor do we believe that other deployment programs such as BEAD, and the NBBP funding will ensure the sustainability of networks for the long term,” the commission said.

The state commission suspended deployment support for 2025. “A pause of the BDS mechanism in its current form will allow the Commission to see the progress of other infrastructure programs including the NBBP,” BEAD, Capital Projects Fund and the FCC’s Enhanced Alternative Connect America Cost Model, the PSC said. Since NTIA directed states to extend 100/20 Mbps broadband to unserved locations under BEAD and because the state broadband office is expected to make grant awards next year, “we find that allocating BDS through the high-cost mechanism in 2025 may result in duplication of support,” the commission said. The PSC will reexamine "the need for deployment support” and its mechanism “once the BEAD program award process has been completed,” it said.

The Nebraska PSC sought comment on “transitional” changes that staff proposed in a second NUSF order. “While many aspects of the proposal may be carried forward to a more permanent mechanism, it is intended to be used initially for only the purposes of high-cost support allocation for the 2025 calendar year,” the commission said: The proposal isn’t meant “to preclude further consideration of high-cost reform." Direct testimony is due Aug. 6; rebuttals, Aug. 20. And the PSC set a hearing for Aug. 29 at 10 a.m. CST.

The staff proposal would continue to support ETCs serving high-cost locations with networks capable of 100 Mbps download and 20 Mbps upload speeds, including price-cap and rate-of-return carriers. It would still define high-cost areas as places that "are outside of cities, villages, and unincorporated areas, and that have less than 20 households and a density less than 42 households per square mile,” with determinations made on a census-block basis.

Staff proposed using location-specific cost modeling data developed through a CostQuest contract. The company would use the June 30 version of the FCC's location fabric for finding broadband serviceable locations and the commission would use the most recent version of the national broadband data collection (BDC) to determine where there is 100/20 Mbps, the proposal said. Under the plan, the “modeled cost for each 100/20 Mbps capable location that is not competitively served by a wireline competitor would be utilized to determine each company’s support base."

The PSC would use its existing method for setting earnings caps for rate-of-return carriers, under the staff proposal. For price-cap carriers, staff proposed using "a rate comparability metric to ensure that customers are being charged comparable rates in urban and rural areas, and that rates are reasonable." To get support, price-cap carriers would have to certify that their rates for 100/20 Mbps voice-capable broadband are less than a $92.24 monthly benchmark, it said. Also, staff proposed formulas to account for federal support that NUSF participants receive. Staff said it expects the PSC will still redistribute support that exceeds a carrier's earnings cap to remaining carriers that haven't yet hit their caps, it said.

PSC staff proposed a "glide path" ensuring that "changes in support are not so drastic as to induce hardship due to the new mechanism." Carriers could either receive the support calculated by the new proposed method "or an amount that equates to 75% of their 2023 ongoing support amount, whichever is higher," subject to the earnings cap, it said. Also, staff proposed clarifying that, while support is meant for maintenance and operational costs, it “can be used to augment existing projects and deployment obligations at the recipient’s discretion.”

Windstream Outages

Windstream may have violated Nebraska rules, the Public Service Commission said Tuesday as it closed its 911 outages investigation and opened a complaint process that will consider fines or other penalties. The agency scheduled a hearing on the complaint for Aug 27-28. The PSC raised concerns about a “growing pattern” of Windstream 911 outages when it expanded its probe in January (see 2401230048).

“Windstream is committed to being a reliable communications provider to Nebraskans, and we will continue to work with the commission on this matter,” a spokesperson said.

The Windstream outages occurred Sept. 2-3, Nov. 28 and Jan. 13. “The evidence indicates that Windstream had insufficient engineering and administrative procedures along with failing to conduct ongoing reviews to maintain adequate and reliable access to 911 services,” the PSC order said. “This is indicated by Windstream’s failure to timely address inadequate redundancies, failure to establish sufficient back up power, lack of testing of backup power equipment, and alarm system.”

The PSC “must have accountability from our telecommunications carriers in providing a redundant system capable of delivering 911 calls no matter the situation,” said Chair Dan Watermeier (R). Emergency services IP network and 911 core services remained functional during the outages, said Dave Sankey, the PSC’s 911 director. “It was the ability of the carrier to deliver the calls to the interconnection points that was impacted.”