The FCC voted 3-2 on an order approving an interim cap for the universal service high-cost fund, it announced late Thursday. FCC Commissioners Robert McDowell and Deborah Tate joined Chairman Kevin Martin in voting for the order. Commissioners Michael Copps and Jonathan Adelstein voted against.

MVNO Virgin Mobile petitioned the FCC to be designated an eligible telecommunications carrier in Tennessee so it can offer service there under the Universal Service Fund lifeline program. “Designation of Virgin Mobile as an ETC in Tennessee would promote the public interest since it would provide qualifying Tennessee customers with lower prices and higher quality wireless services,” the company said.

FCC “unwillingness to cooperate” with a Senate inquiry raises concern that the E-Rate program “has been grossly mismanaged,” Sen. Sam Brownback, R-Kan., said in a letter sent Tuesday to FCC Chairman Kevin Martin. “As of today I have not received a single document I requested” in a letter sent to the commission April 11 (WID April 28 p1), Brownback said.

FCC “unwillingness to cooperate” with a Senate inquiry raises concern that the E-Rate program “has been grossly mismanaged,” Sen. Sam Brownback, R-Kan., said in a letter sent Tuesday to FCC Chairman Kevin Martin. “As of today I have not received a single document I requested” in a letter sent to the commission April 11 (CD April 28 p8), Brownback said.

The FCC rebuffed CTIA’s request to extend to similarly situated contributors relief an earlier true-up waiver order granted three Universal Service Fund contributors. CTIA’s petition for reconsideration spent nearly 4 years pending. In July 2004 the FCC partly exempted AT&T, SBC and Verizon from agency universal service true-up procedures for 2003, on grounds that they “demonstrated good cause to justify the waiver.” The carriers claimed the true-up process “unfairly disadvantages” them by requiring they pay “true-up amounts in excess of their appropriate contributions for 2nd through 4th quarter 2003.” The agency adopted the 2003 true-up process to address the transition from contributions based on historical billed to a basis on projected collected revenue, the FCC said. In August 2004 CTIA sought “me too” relief for wireless carriers. But “CTIA has not provided new information sufficient to warrant extending relief to all similarly-situated companies regardless of their individual circumstances,” the FCC said. A wireless industry source said Tuesday that the FCC is in effect requiring all carriers, no matter how small, make the effort to check whether they overpaid. “I don’t think it’s anything anyone had counted on [winning] or a lot of money,” the source said. - HB

Affordable voice service for those in need, not financial support for carriers, would be the “paramount” aim of the universal service program, according to draft legislation released Monday at a Free State Foundation panel discussion. Proposed by House Commerce Committee ranking member Joe Barton of Texas, the bill drew panelists’ praise as embodying proposals with widespread support.

FCC Commissioner Robert McDowell announced Monday that he had cast an electronic vote supporting a cap on the high- cost Universal Service Fund. He became convinced that a cap is needed because the contribution factor - the proportion of long-distance revenue that carriers must contribute to the fund -- is again on the rise after declining last year. McDowell’s support gives Chairman Kevin Martin the deciding third vote in favor of a cap (CD April 28 p1). Commissioner Michael Copps previously voted against the cap. All the commissioners but Jonathan Adelstein have voted, sources said.

The Texas Public Utility Commission unanimously approved a 36.5 percent reduction in the state universal service high- cost fund. The fund will be cut in steps to $251 million a year, from the current $395 million, by 2012. The current 4.4 percent monthly state universal service fee on phone bills will be cut to 3.4 percent over the four years. The decision will reduce the fund by ending high-cost support in competitive deregulated exchanges of more than 30,000 population and reducing the lines eligible for high-cost support elsewhere. Competitive deregulated exchanges under 30,000 will get support only where necessary to preserve affordable phone service. The order (Case 34723) approved a settlement proposal reached April 8 by the state’s major wireline, cable and wireless providers, state consumer counsel and PUC staff. The AARP criticized the approval, saying there’s no guarantee that consumers will see save any money, since carriers can increase telephone rates to make up for subsidy losses. The PUC launched its review last summer in response to a directive from the 2005 legislature. The major players took very different approaches to revamping the state program, and the PUC directed them to attempt a negotiated settlement. In a related action, the PUC ordered a 40 percent reduction in the phone bill surcharge that supports the California Teleconnect Fund, effective June 1. Under the PUC order, the surcharge will be cut to 0.079 percent monthly from 0.13 percent, to “better align program expenses and revenues.” The fund subsidizes voice and data services for schools, libraries, government-supported health clinics and qualifying community-based organizations.

A flaw in a proposal for a new administrator of the E- Rate program may keep qualified vendors from bidding on the contract, Sen. Sam Brownback, R-Kan., told FCC Chairman Kevin Martin in an April 11 letter we obtained. “I am concerned that the RFP [request for proposal] may be flawed,” Brownback said in the letter, requesting many documents on commission work with the Universal Service Administrative Company, which oversees the program.

The Missouri Public Service Commission gave Windstar until May 23 to explain why it didn’t obey a state court order that it pay $45,000 in restitution and penalties for failing to remit funds collected as deaf relay and universal service surcharges. In February the court told Windstar to pay back $25,000 to the relay and universal service funds, and levied a $20,000 fine. The Office of Public Counsel recently filed a complaint (Case TC-2008-0346) seeking revocation of Windstar’s state operating authority for failing to comply with the order (CD April 24 p 10). The PSC also told its staff to make its recommendation by June 22, with replies due July 2.