Burns Introduces Universal Service Bill
Sen. Burns (R-Mont.) introduced a universal service bill Wed. that he said, among other things, would “strengthen the FCC’s management and oversight” of the E-rate program. In a floor statement, he said the bill would “impose sanctions on applicants or vendors who repeatedly and knowingly violate [E-rate] program rules.” Organizations representing rural telephone companies appeared particularly supportive of the 29-page bill, which was specific enough to include provisions on phantom traffic and use of universal service funding for broadband service. David Zesiger, exec. dir. of the Independent Telephone & Telecom Alliance, said the measure appeared to be “the most comprehensive universal service bill to date.”
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Burns, who introduced the bill on the 10th anniversary of the Telecom Act, called it the Internet & Universal Service Act of 2006, dubbing it “NetUSA, if you will.” He said the bill also sought to: (1) “Ensure that companies that receive universal service funds will invest and deploy broadband services.” (2) “Ensure that universal service support contributions are assessed in a fair and competitively neutral manner.” (3) “Improve the effectiveness of the Rural Health Care Program.”
The Coalition to Keep America Connected, made up of small and mid-sized telephone companies, said it was pleased with a provision that would “broaden the base of contributors into the universal service fund,” meaning contributions would be assessed in a “competitively neutral manner.” The coalition also read the bill to “tighten up accountability on competitive eligible telecommunications carriers (ETCs) which account for the vast majority of growth in the fund.”
Among the key provisions: A section on broadband investment that requires the FCC to “ensure that eligible telecommunications carriers have sufficient incentives, through the use of federal universal service support mechanisms, to invest and deploy network facilities to provide broadband service… for the benefit of all Americans in rural, insular and high-cost areas.” The bill would require the FCC to complete a rulemaking in 180 days “to define advanced telecommunications infrastructure and broadband service” and to do studies every 3 years to identify economic and technical barriers to the deployment of “next generation advanced telecommunications and information networks.”
A section on “integrity and accountability” in the distribution of universal service funding would require that before rural telecom companies could get funding they would have to offer services similar to those offered by incumbents and offer them over their own facilities, “excluding unbundled network elements.” It also would legislate a definition favored by rural incumbents but not their competitors. It would require competitive ETCs to serve the same area as served by the rural incumbent. Wireless ETCs have argued they should get funding based on their own service areas. The section also would require the FCC to keep a closer eye on the amount of support due rural carriers “based on a prior showing of the actual costs of providing, maintaining and upgrading of facilities.” It would require the FCC to complete a rulemaking in 270 days to establish “competitively neutral criteria for demonstrating actual costs.”
A section on the contribution base for the universal service fund would empower the FCC to base contributions in part of intrastate revenue. The agency is barred from doing that as a result of a decision several years ago by the 5th U.S. Appeals Court, New Orleans. The section also makes clear the FCC need not stick to today’s revenue-based methodology for assessing contributions but also could use “working telephone numbers” or any other system.
A section on “network traffic accountability standards” appears to deal with phantom traffic by proposing to require carriers to “properly identify the traffic that such carrier originates or transmits in such a manner as to enable a terminating carrier to properly identify, measure and charge for such traffic.” The FCC would have to adopt rules to make that happen within 120 days of the bill’s enactment.