The Universal Service Fund high-cost program has an unacceptably high rate of erroneous payments, said the FCC Office of Inspector General in a Wednesday report on the IG’s second round of USF audits. After studying USF high-cost distributions, the OIG estimated that the high-cost program’s erroneous payment is 23.3 percent, resulting in $971.2 million in improper payments, the FCC said. A program is considered to be “at risk” if the rate exceeds 2.5 percent. The OIG report looked at 384 audits of high-cost recipients performed by commercial audit firms contracted and managed by the Universal Service Administrative Co. with FCC OIG oversight. The commission is collecting industry feedback on how to improve USF management and administration. In comments last week, USF payers and recipients said they wanted more clarity, administrative efficiency and audit consistency (CD Nov 17 p6).

An FCC draft order grants Qwest forbearance from Automated Reporting Management Information System requirements, an FCC official said Wednesday. If adopted, the order would kill leftover ARMIS reports on financial information not covered in a September FCC order granting a similar petition by AT&T, the official said. Commissioners must vote on the order -- now circulating -- by Dec. 12, or the Qwest petition will be deemed granted.

Adoption of numbers-based system as part of Universal Service Fund reform would have a negative effect on “important emergency communications services” if the fee is imposed on vehicle telematics services, such as OnStar or ATX, APCO and the National Emergency Number Association warned the FCC. Telematics companies were also at the FCC for recent meetings to ask the FCC not to impose the fee on their lines, a step proposed in all three rulemakings on USF reform now before commissioners.

Nebraskans have until Dec. 15 to apply for an opening on the state Universal Service Fund Advisory Board. The slot, one of two representing the general public, is held by Anne Byers, whose term ends Dec. 31. Appointees aren’t paid or reimbursed for expenses. They work with the Nebraska Public Service Commission and with Telecommunications Infrastructure and Public Safety Department officials, advising on matters related to administration of the state universal service fund. Letters of interest are due Dec. 15 to Sue Vanicek, Nebraska PSC, P.O. Box 94927, Lincoln NE 68509.

The Alaska Telephone Association agrees that Alaska and Hawaii should be exempted from pending changes to Universal Service Fund distribution, the association said in meetings last week with FCC Commissioners. However, “the identical support rule should not remain in effect indefinitely,” it said. The association is concerned that “a broadband standard that did not apply to the non-contiguous states could result in our citizens being left without comparable access.” The association met with Commissioners Robert McDowell and Deborah Tate, and aides to Commissioners Kevin Martin, Michael Copps and Jonathan Adelstein, according to an ex parte. Comments on three plans to revamp USF and intercarrier compensation are due Wednesday.

With strengthened Democratic majorities, Congress may move quickly on telecom issues such as broadband, net neutrality and media ownership, speakers said Monday at a Pike & Fischer conference. Many Democratic lawmakers view the new Congress as a “unique opportunity,” said e-Copernicus President Greg Rohde, a former Clinton administration official and Senate staffer. Members have told him the combination of a Democratic White House and a potentially filibuster-proof Democratic Congress “creates a new dynamic,” Rohde said.

With strengthened Democratic majorities, Congress may move quickly on telecom issues such as broadband and net neutrality, speakers said Monday at a Pike & Fischer conference. Many Democratic lawmakers view the new Congress as a “unique opportunity,” said e-Copernicus President Greg Rohde, a former Clinton administration official and Senate staffer. Members have told him the combination of a Democratic White House and a potentially filibuster-proof Democratic Congress “creates a new dynamic,” Rohde said.

AT&T urged revisions to the contribution aspect of an FCC Universal Service Fund overhaul plan known as Appendix B, one of three overhaul plans for which the agency has sought comment. In a late Friday ex parte letter, AT&T also rejected the contribution approach detailed in Appendices A and C, plans that additionally tackle intercarrier compensation. All the plans would move USF contribution from a revenue-based approach to one based on the quantity of phone numbers and business connections that a carrier owns. AT&T wants a numbers-only contribution method. But if the FCC determines that there should be an additional assessment based on business connections, the agency should modify its proposed assessment measurements to make them “more technology neutral and forward-looking insofar as they are not based on legacy ILEC speed breakpoints,” AT&T said. Also, AT&T believes the FCC’s definition of “assessable number” is “confusing, introduces -- without explanation -- terminology not previously used by Congress or by the Commission, and is unnecessarily overreaching,” it said. AT&T wants a simple definition saying an assessable number is “a North American Numbering Plan (NANP) telephone number that enables a Final Consumer to make or receive calls.” The FCC definition left room for a post-number call identifier, but AT&T wants the FCC to instead seek further comment on that point, the carrier said. AT&T also asked the commission to expand the implementation period for contribution change to at least one year, from six months, plus an extra six months during which providers would “report numbers while continuing to contribute based on revenues.” AT&T also proposed edits related to other exemptions, subsidy funds, reseller certifications and Universal Service Administrative Co. invoices. Comments on the FCC’s three draft plans are due Wednesday. All FCC members other than Chairman Kevin Martin have said they want to vote on an overhaul at the Dec. 18 meeting, but Martin said last week it’s unlikely that that will happen (CD Nov 19 p2).

Panelists differed Friday on U.S. models for international broadband competitiveness and domestic competition at a forum of the Innovation Technology & Information Foundation. They did agree that a new national broadband policy that promotes competition is needed from the new presidential administration.

The FCC won’t adopt changes to the E-rate Eligible Services List proposed by the Universal Service Administrative Co. (CD Sept 22 p5), the agency said Friday as it released the 2009 ESL. “As such, the funding year 2009 ESL … is the same as the funding year 2008 ESL,” it said. The FCC waived an agency rule requiring it to issue the ESL public notice at least 60 days prior to opening the E-Rate filing window, authorizing USAC to start taking submissions this Tuesday, the commission said.