The FCC’s comment period has closed and industry officials are pressing their cases for Universal Service Fund and intercarrier compensation regime updates at venues from the Hill to the commission. Talks continue, with the hope of reaching an industry-wide consensus, but each sector has already begun pressing cases in ex parte meetings and Hill visits. Rural telcos have been dropping letters off on the Hill, asking legislators to urge FCC Chairman Julius Genachowski “strongly” to “consider the proposals put forward by the rural associations (OPASTCO, WTA, NTCA and NECA).” OPASTCO Vice President Randy Tyree said he hopes Congress will “weigh in and let the FCC know the importance of rural cooperatives that are out there serving and doing a good job.”

BERKELEY, Calif. -- Requests for cybersecurity R&D money are in trouble in the House, said a Homeland Security Department official. “Things are getting very interesting in Washington, and none of it is very positive,” Douglas Maughan, the department’s cybersecurity division director, said at an event to preview a strategic plan for federal funding efforts. The event late Wednesday was held in connection with the IEEE Symposium on Security and Privacy. It was organized by the National Coordinating Office for Networking and Information Technology Research and Development, which involves 15 federal agencies and coordinates all government R&D efforts.

The FCC can hand Universal Service Funds to non-Title II services, Public Knowledge said in a meeting with FCC officials. “While it continues to believe that the best legal framework to support USF for broadband is Title II, the theories articulated by the Commission in its NPRM … can provide adequate authority to direct funds to providers of information services,” the group said in an ex parte notice posted on docket 10-90 and published on the commission’s website Wednesday. Public Knowledge argued that the FCC ought to set a Universal Service Fund goal of 100 percent broadband penetration. “In particular, PK discussed its proposal that fund recipients be required to provide interconnection points to allow unserved communities to provision their own broadband service,” the group said of its Tuesday meeting. “Under this self-provisioning model, communities that would be otherwise unserved have the option of deploying a network suitable to local conditions, gaining connectivity from a nearby USF recipient.” The group urged the commission to consider one-time grants for equipment. But Public Knowledge “also argued that metrics other than speed” be considered in reforms. “For instance, some providers (such as many satellite broadband operators) only offer service with restrictive network management practices and usage caps,” the group said.

The FCC “must move beyond the traditional commercial model of service and develop policies that encourage efficient use of existing infrastructure,” the New America Foundation, Consumers Union and Media Access Project said in consolidated comments on the Universal Service Fund and intercarrier compensation reform dockets. “The Commission should adopt public interest obligations that adequately protect consumer interests, particularly where there is a chance that the Commission may fund a single provider in a geographic area.”

Texas Republican Governor Rick Perry signed SB-980 (CD March 24 p8) into law. The law adds definition for, and preempts state regulation of, VoIP and IP-enabled services. It doesn’t affect the application of certain fees and charges to VoIP, including rights of way fees, 911 fees, relay access fees, state Universal Service Fund fees, interconnection, access charge or intercarrier compensation and other taxes. The law, which will exempt telecom companies from some reporting requirements, takes effect Sept. 1.

The House would cut the broadband loans program at the Rural Utilities Service under fiscal 2012 budget legislation moving through the Appropriations Committee. The panel’s Agriculture Subcommittee late Tuesday approved an agriculture bill that counts the RUS program among its cuts. House Communications Subcommittee Ranking Member Anna Eshoo, D-Calif., slammed the proposed cut. USTelecom and the NTCA supported giving $22 million to the loans program under an amendment submitted by Rep. Cynthia Lummis, R-Wyo. At our deadline, the subcommittee voted not to adopt the Lummis amendment. Subcommittee Chairman Jack Kingston, R-Ga., “opposes the broadband program as he sees it as corporate welfare at its worst, duplicat[ing] other federal programs, and is not the best use of taxpayer dollars,” a spokesman said. The RUS broadband loans program had $22 million under the fiscal 2011 continuing resolution, supporting about $400 million in loans. The $17.2 billion Agriculture bill cuts $2.6 billion total from last year’s level and is $5 billion lower than President Barack Obama’s request. The RUS restarted its troubled broadband loan program earlier this year and published interim rules. “This cut is a mistake,” Eshoo told us in a written statement. “Broadband access is absolutely essential to future economic growth and job creation. A smart overall strategy is to wire America to compete in an increasingly global marketplace. That’s what’s being cut.” Eshoo said she will “work hard to preserve our gains.” USTelecom urged support for the Lummis amendment, in letters sent Tuesday to Kingston and Ranking Member Sam Farr, D-Calif. “Like you, we were frustrated that it took almost three years for the agency to issue the regulations implementing the programmatic changes required by the Farm Bill,” CEO Walter McCormick wrote. There’s still interest in the program, and RUS has already received applications totaling $105 million, he said. The RUS program isn’t “duplicative” but instead “complementary” to the Universal Service Fund, McCormick said. “The RUS broadband loan programs are absolutely critical to accomplishing policy-makers’ worthy goal of universal broadband availability -- most especially for the small independent carriers that have made the commitment to serving high-cost rural communities rather than focus on markets where the returns are the highest,” NTCA CEO Shirley Bloomfield said in a written statement. “Access to RUS broadband loans is critical to a rural carrier’s ability to continue investing in its communications infrastructure,” said OPASTCO Vice President Randy Tyree. “Without funding sources such as RUS broadband loans, rural carriers will have reduced access to funding that will lead to reduced investment in rural networks.” RUS didn’t respond to a request for comment.

The Florida Public Service Commission settled with Associated Telecom Management Services over violations of state Lifeline rules, the commission said. ATMS companies operating in Florida include American Dial Tone (ADT), Bellerud, LifeConnex and All American Telecom. A recent PSC staff investigation uncovered unusual growth in Universal Service Fund disbursements for some ATMS Florida companies. ADT received $6.2 million in state USF funds. The investigation also indicated from multiple anonymous sources that ATMS’s Florida subsidiaries allegedly failed to obtain certification of Lifeline applicants, misrepresented customer enrollments when claiming reimbursement and improperly shared customer information. As part of the settlement, ATMS will pay $4 million to Florida’s General Revenue Fund, in $250,000 quarterly installments, with the chance to suspend $2 million of payments if the company shows all terms of the pact were met. The company committed to a four-year agreement of enhanced monitoring and compliance, with penalties for non-compliance. It will surrender all competitive local exchange company certificates except American Dial Tone and agree to suspension of ADT’s eligible telecom carrier designation for two years, with the option to request that the PSC lift suspension after one year for demonstrated compliance.

Industry remains divided on how best to fix the Universal Service Fund and intercarrier compensation regimes, with a few months left before an FCC-promised deadline. Despite broad agreement that USF and intercarrier comp need fixing, reply comments show deep divisions over such questions as how quickly to transform to an all-IP network, how to treat VoIP service and the role of satellite and wireless technologies. “There is no doubt that the current universal service fund … and intercarrier compensation regimes are not sustainable in light of market and technological changes,” the Independent Telephone & Telecommunications Alliance said. “The comments show that there is no industry consensus in favor of the reforms outlined in the Notice or any other plan to promote broadband deployment to unserved areas.” The replies were posted in docket 10-90.

The House would cut the broadband loans program at the Rural Utilities Service under fiscal 2012 budget legislation moving through the Appropriations Committee. The panel’s Agriculture Subcommittee late Tuesday approved an agriculture bill that counts the RUS program among its cuts. House Communications Subcommittee Ranking Member Anna Eshoo, D-Calif., slammed the proposed cut. USTelecom and the NTCA supported giving $22 million to the loans program under an amendment submitted by Rep. Cynthia Lummis, R-Wyo. At our deadline, the subcommittee voted not to adopt the Lummis amendment.

The FCC should impose a date certain for the end of the high-cost Universal Service Fund, the Free State Foundation said in reply comments on a rulemaking on the future of USF and intercarrier compensation. The fund imposes a 15 percent “tax” on all long distance calls to support universal service subsidies, the group said. “The Commission’s end game for its comprehensive USF and ICC reforms should be the eventual elimination of all high-cost fund and related subsidies,” the foundation said. “Placing a hard cap on the high-cost fund and lowering it over time in tandem with a decreasing fund size constitutes a realistic means for achieving that end."