The Tex. PUC called for comment by Dec. 10 on a set of refund issues relating to a Sept. change in the assessment methodology for the state universal service fund, which the PUC was forced to make because of a federal appeals court decision in July. That decision barred the PUC from levying a state universal service fund assessment on carrier revenue from interstate and international services. As a result, the PUC changed the assessment to 5.65% of intrastate gross receipts from 3.6% of all gross receipts. Some carriers (Case 29950) questioned whether the state owed a refund of universal service assessments on interstate/international revenues. But the PUC said that question involved what time periods should be included for refunds and whether customers should get a pass-through refund as well. The staff also questioned whether any true-ups should be done all at once or in installments.

Federal regulators told the NARUC convention in Nashville Wed. jurisdiction changes arising from new technology and service concepts in telecom and energy will make it more important than ever for the federal and state govts. to cooperate. FCC Comr. Abernathy said new technologies like VoIP make adherence to old federal-state jurisdiction lines infeasible, but the states will still have a role. She said the FCC and the states “still should work in collaboration on sound public policy. The FCC can’t handle matters like [VoIP] E-911 without the cooperation of state regulators.” She said some new technologies and service concepts require a single national policy, but “details of implementation should still be worked out with the states.” She said the core question is: “What type of regulatory regime best serves to deliver value to consumers?” She said that with VoIP, federal preemption was necessary because IP-enabled packet-switched technologies don’t recognize boundaries: “IP-enabled services only superficially resemble circuit- switched voice,” she said. “But in the IP world, the old end-to-end jurisdictional analysis simply didn’t work” because IP users could call anyone from anywhere and all calls looked the same. She said the Vonage VoIP preemption order didn’t deny the states a supporting role. She said it gave state attorneys general responsibility for addressing broad matters of VoIP consumer protection. She said the FCC had to settle VoIP jurisdiction before taking up other VoIP issues. Patrick Wood, chmn. of the Federal Energy Regulatory Commission (FERC) and a former Tex. regulator, said federal-state cooperation will be crucial in development of policy for broadband over power lines (BPL), which will put the FERC, FCC and state commissions in a regulatory triangle. He said all parties involved must maintain flexible and not lose sight of the fact that they all exist to protect consumers. Hilda Legg, dir. of the Rural Utilities Service, said the states and federal agencies “have to work together and communicate. We need to be willing to listen to each other because we have a common purpose.” She said the telecom and energy infrastructures will remain the foundation of national economic growth despite all the industry changes. She said BPL may present unique circumstances for RUS as a lender. She said RUS could end up lending money to an electric utility that seeks to offer BPL in competition with a phone company that also is an RUS borrower. She said: “It is in the national interest to keep rural America connected. The whole nation benefits from a strong rural economy.” Iowa Comr. Dianne Muns, new NARUC first vp, said no one level of govt. can do all things anymore. “Our discussions need to be about who should be doing what.” She said states have been very effective at resolving wholesale contract disputes and retail consumer complaints and doing public education and information gathering, and they should retain their authority in these areas: “We need to respect each other’s strengths and try to reach agreement on what each should be doing. Both levels are important and have jobs to do.” -- HK

Senate Appropriators have agreed to add language to appropriation legislation that would forbid the FCC from adopting a primary-line restriction for the universal service fund, a Senate source told us. The language in the Commerce Justice State portion of the Omnibus Appropriations Bill would prevent the FCC from spending any money to enact a primary-line restriction. The FCC’s Joint Federal-State board on USF reform recommended earlier this year that the FCC give USF funding only to the primary line that delivers service to consumers. The recommendation is strongly opposed by rural groups. Several sources said this week that it was very likely that the amendment would be included in appropriations language.

NASHVILLE -- Federal regulators should reform intercarrier compensation and universal service subsidy eligibility standards if they want to make real progress on fundamental reform of the universal service high-cost support system, telecom interests told the Federal-State Universal Service Joint Board.

The White House announced its intention to renominate FCC Comr. Adelstein, and a spokeswoman for Senate Majority Leader Frist (R-Tenn.) told us that unresolved nominations could move individually this week as opposed to being included as a package. Individual consideration could help Adelstein’s chances by separating him from controversial nominees. Already, objections to some judicial nominees are brewing in the Senate Judiciary Committee. However, several sources told us Adelstein’s nomination appears safe at this point.

NASHVILLE -- Telecom makes investors nervous because it has regulatory and technological uncertainties that don’t exist in other industries competing for capital, said NARUC panelists at the group’s annual meeting here Mon. The advent of paradigm-breaking new technologies like VoIP and the prospect of a major rewrite of the federal Telecom Act next Congress have led many telecom investors to move to the sidelines and wait out the stormy times, panelists said.

The FCC shouldn’t vote on a DTV transition plan until Congress fully funds a mechanism to ensure universal TV service for all Americans, the Minority Media & Telecom Council (MMTC) said in a letter to the FCC. MMTC supported plans to provide vouchers, funded from spectrum auctions, for low-income consumers to equip sets with down-conversion capability. MMTC also advocated vouchers for DTV-ready sets. The White House announced its opposition to any voucher initiative Oct. 21, MMTC said: “These families, many living paycheck to paycheck, as well as elderly and disabled persons surviving on social security, cannot suddenly yield up the cost of a converter box without forgoing a week of food.”

The FCC shouldn’t vote on a DTV transition plan until Congress fully funds a mechanism to ensure universal TV service for all Americans, the Minority Media & Telecom Council (MMTC) said in a letter to the FCC. MMTC supported plans to provide vouchers, funded from spectrum auctions, for low-income consumers to equip sets with down-conversion capability. MMTC also advocated vouchers for DTV-ready sets. The White House announced its opposition to any voucher initiative Oct. 21, MMTC said: “These families, many living paycheck to paycheck, as well as elderly and disabled persons surviving on social security, cannot suddenly yield up the cost of a converter box without forgoing a week of food.”

Several important communications-related items could pass Congress this week as it returns for a brief lame- duck session, industry and congressional sources said. The loudest buzz is on the universal service fund (USF) and the controversy over the FCC’s change in accounting mechanisms that could slow some E-rate payments and possibly lead to a rise in contributions, and several sources expected some efforts to push a legislative solution.

Vonage’s DigitalVoice VoIP service is interstate, so it can’t be regulated by state PUCs, the FCC ruled Tues. The ruling was hailed by CEA, which said the FCC’s action “provides the appropriate framework to establish one federal nationwide VoIP policy.”