NTCA Presses FCC to Fix High-Cost USF Budget Shortfall Facing RLEC Mechanisms
NTCA again urged the FCC "to address the shortfall" in high-cost USF support "undermining" the "effectiveness of recent reforms" as "RLECs are being asked to do more with less." Lack of funding for a model-based mechanism means 71,000 rural locations…
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will receive lower-speed broadband, "and 50,000 may see no broadband investment," said the group's filing Tuesday in docket 10-90 on a meeting with an aide to Chairman Ajit Pai. It said a shortfall of $173 million-$283 million over the next year "for cost-based USF recovery will severely harm rural American consumers and businesses in the form of higher prices, lower speeds, and reduced investment." Some 183 NTCA carriers indicated they plan to cut broadband investments over the next year by nearly $950,000, on average, the group said. NTCA said it understood Universal Service Administrative Co., as of now, will cease next year to collect for the overall high-cost USF annual budget of $4.5 billion, instead collecting only what is needs to meet "current demand," which for RLECs, "would include a budget control mechanism that artificially 'suppresses' USF support demand." The group urged the FCC to direct USAC to collect at least the $4.5 billion in support, pending completion of a budget review the agency promised a federal court. The FCC should use reserves to help fill the shortfall, NTCA said, citing USF cash balances that overall "may approach $8 billion as of year-end," including up to $2.2 billion for high-cost support, about $445 million of which is unallocated.