Consumers’ Research filed another legal challenge to the FCC’s Universal Service Fund, this time against the Q1 2023 contribution factor, in the 6th U.S. Circuit Court of Appeals. The group has another challenge in the 6th Circuit against the Q4 2021 contribution factor, plus a case in the 5th Circuit against the Q1 2022 factor, and a challenge in the 11th against the Q4 2022 factor. Oral argument was held in the 5th Circuit case earlier this month (see 2212060070), and the FCC filed a response brief in the 11th Circuit last week (see 2212230007). The latest filing takes a similar tack to Consumers’ Research’s other cases, arguing that the USF contribution factor is an unconstitutional tax because it's imposed by the FCC rather than Congress, and that the FCC has violated the Administrative Procedure Act. The group is likely challenging the contribution factor in the same circuit as an ongoing challenge to provide a backstop if the other 6th Circuit case is dismissed or rejected for narrow procedural reasons, said Benton Institute for Broadband & Society Senior Counselor Andrew Schwartzman, who has filed in support of the FCC in other Consumers’ Research cases. Consumers’ Research didn’t comment. The new case likely won’t be briefed or move forward while the other 6th Circuit one is ongoing, Schwartzman said.

Providers in Puerto Rico and the U.S. Virgin Islands disagreed over whether the FCC should cut transitional support for incumbent providers on the islands, in reply comments posted Wednesday in docket 18-143. Puerto Rico's Negociado de Telecomunicaciones (NET) is now calling on the FCC not to slash transitional support, as proposed in an October NPRM (see 2210270046). Initial comments were filed earlier this month (see 2212120053).

The Schools, Health & Libraries Broadband Coalition raised concerns it said it brought up in the past that members of the group can’t seek funding for a telehealth project using FCC Form 460 until a site is open, said a filing posted Tuesday in docket 17-310. “This means there is no process to allow … funding for up to more than a year of operation,” SHLB said: The Universal Service Administrative Co. “has indicated it takes this approach based on direction from the FCC, so we are writing to see if you would be willing to direct USAC to change this as an administrative matter.” SHLB said it brought the issue up in a meeting with Wireline Bureau staff earlier this month and since the discussion “several SHLB members have volunteered that they are again having this problem this year, some with multiple sites.”

The FCC's Q4 2022 universal service contribution factor proceeding isn't the right venue for challenging the constitutionality of the entire universal service fund regime, and Section 254 of the Communications Act "easily" answers questions about whether Congress wrongly delegated its lawmaking power by limiting and guiding the FCC's universal service implementation, the agency told the 11th U.S. Circuit Court of Appeals Dec. 22. In a docket 22-13315 reply to a challenge to the USF (see 2211220075), the FCC said the 11th Circuit also lacks jurisdiction because the suit is attempting "an end-run" around time limits for challenging an agency rule. Counsel for the petitioners didn't comment Friday.

A court ruling striking down USF and the Rural Digital Opportunity Fund would significantly harm millions of people and businesses and threaten the operations and investments of cable operators, NCTA told the 6th U.S. Circuit Court of Appeals in an amicus brief Monday supporting the FCC in Consumer’s Research v. FCC (docket 21-3886). Consumers' Research argued the funding mechanism for the Universal Service Fund violates the U.S. Constitution by delegating tax responsibilities reserved for Congress (see 2212130069). “The tremendous real-world stakes of this case should give this Court pause before entertaining Petitioners’ unprecedented non-delegation theory,” NCTA said. Ending RDOF would threaten internet connectivity across the country and strand investments in broadband infrastructure expansion “without any ability to recover the considerable resources operators have poured into these projects,” NCTA said. “Petitioners fail to give the Court any compelling reason to cut off consumers from their services, upend cable operators’ customer relationships, and disrupt the major investments cable operators have already made in reliance on USF support,” said the filing. Creating a separate funding entity to manage universal access to telecommunications is a common practice internationally and in line with International Telecommunications Union best practices, said Penn State Law Professor Robert Frieden in a separate amicus brief. Having a separate organization, “promotes greater transparency, accountability, and efficiency in the collection and disbursements of funds,” Frieden said.

Rural Wireless Association representatives warned of problems if removing insecure equipment from carrier networks isn’t fully funded by Congress (see 2212150076). “Due to uncertainty about the timing and availability of Reimbursement Program funding, Reimbursement Program participants are finding it difficult even to borrow the funds needed to remove, replace, and destroy their covered equipment,” said a filing posted Monday in docket 18-89. “The difficulty in finding lenders has forced many to halt the removal, replacement, and destruction of equipment, leaving networks to deteriorate as time goes on and service to be lost as Universal Service funds cannot be used to upgrade the networks that contain covered equipment,” RWA said: “Without the ability to obtain funds to replace equipment, providers experience reduction in network coverage in otherwise unserved areas.” RWA met with FCC Wireline Bureau staff. SI Wireless, NTCH Cleartalk, PTCI, Widelity, Strata Networks and Americrew were also at the meeting. RWA also reported on a call with aides to Chairwoman Jessica Rosenworcel on the 5G Fund. RWA members said they "deployed and are operating mobile networks in areas not served by the nationwide providers, providing needed connectivity to their customers and the public generally though roaming agreements and E-911 services,” said a filing in docket 20-32: “In many cases, this could not have been done without the Universal Service Fund … support the carriers receive through the Mobility Fund, and now those carriers are using their USF support to upgrade to 5G coverage. RWA said the current 5G Fund framework risks undermining this progress, stranding those networks, and wasting current USF support because it lacks a reasonable transition between the legacy support mechanism and a future 5G Fund.”

Broadband experts and industry officials encouraged property owners and providers Wednesday to develop partnerships to meet the connectivity needs for residents in multidwelling units. Panelists during a Broadband Breakfast webinar cited challenges of deploying broadband in MDUs, including retrofitting older buildings, and encouraged stakeholders to consider various technological solutions.

Senate Communications Subcommittee members from both parties targeted FCC and NTIA implementation of connectivity programs created in the Infrastructure Investment and Jobs Act and COVID-19 aid measures Tuesday, as expected (see 2212120064), including concerns about deficient data the commission used to develop its new broadband maps. Lawmakers also touched on other telecom policymaking matters they hope Capitol Hill can address during the lame-duck session or in the next Congress. Senate Commerce Committee leaders saw a potential one-week extension of their talks on one lame-duck priority, a compromise spectrum legislative package (see 2212070068), appear via a proposed continuing resolution to fund the federal government past Friday.

Consumers' Research's petition for review of the FCC's Q4 2021 USF contribution factor is untimely and its claims "lack merit," the commission told the 6th U.S. Circuit Court of Appeals in a brief posted Tuesday in case 21-3886. The commission's authority to delegate the Universal Service Administrative Co. with calculating the quarterly factor is "clearly constitutional" because USAC is "subordinate to the commission and assists only in performing the accounting, billing, disbursement, and related functions necessary to operate the program," it said. The FCC asked the court to "not reward petitioners’ disregard for Congress’s comprehensive framework for judicial review of FCC orders by entertaining this petition on the merits." A coalition of industry groups filed a joint brief in support of the FCC and asked the court to reject Consumers' Research's claim that the contributions are taxes rather than fees. Petitioners "exaggerate every aspect of this case" and USAC’s role in determining the quarterly factors, said USTelecom, NTCA, and the Competitive Carriers Association in a joint brief: "The FCC’s regulations demonstrate that USAC exercises no lawmaking authority." The Schools, Health, & Libraries Broadband Coalition, Benton Institute for Broadband & Society, National Digital Inclusion Alliance and Media Justice also asked the court to reject Consumers' Research's challenge, said the intervenors. "Petitioners cannot circumvent their timeliness problem through a manufactured challenge to this ministerial public notice," the groups said, citing the FCC's quarterly notice announcing each factor. Consumers' Research is seeking "untimely review of the constitutionality of the entire Universal Service Fund," the groups said, echoing arguments made by the industry coalition. The 5th Circuit held oral argument earlier this month on the group's challenge of the Q1 2022 contribution factor (see 2212060070).

States are marching ahead with plans to get as much broadband money as possible through the Infrastructure Investment and Jobs Act (IIJA). NTIA announced planning grant awards to many more states Thursday for broadband equity, access and deployment (BEAD) and digital equity programs. NTIA can and should give states a couple of more months to submit challenges to FCC maps to ensure BEAD money gets allocated properly, CCG Consulting President Doug Dawson said Thursday at the Maine Broadband Summit.