FCC would be required to conduct new e-rate rulemaking, altering program in ways that one supporter suspected could destroy it, under proposals tucked into President Bush’s budget proposal (CD April 10 p1). General provision in proposed Commerce Dept. budget would have Congress direct Commission to finish rulemaking by Sept. 30, 2002. However, e-rate foe thought program got boost when $2.25 billion in e-rate funds and similar amount for high-cost universal service money for first time were included as $4.5-billion line item (rising to $5.6 billion in FYs 2001 and 2002) in FCC budget.

Idaho PUC decided on disposition of $4.94 million in proceeds from last year’s Qwest sale to Citizens Telecom of 8 exchanges in northern Idaho that was earmarked for benefit of affected ratepayers. PUC directed money be spent on installation of high- speed fiber interoffice transmission system between communities of Riggins and Grangeville. Agency dismissed alternative proposal that money be deposited in Idaho high-cost fund for universal service support. PUC said new fiber route would allow direct connections among sold exchanges, improve service between central and northern areas of state and “close the longest and costliest gap in a future continuous fiber route” that eventually will connect northern and southern Idaho.

Bush Administration’s fiscal year 2002 budget proposal would increase funds for FCC, but White House’s long term strategy is to level off agency’s spending over the next 4 years. According to govt. budget details released Mon., Bush would increase FCC’s FY 2002 budget to $248.5 million from current $230 million. Total proposed outlays, or “amount the [FCC] actually spends in a given fiscal year,” would increase to $320 million from $301 million. Spending in FY 2003 and 2004 would drop to $302 million, then increase by $1 million in FY 2005 and FY 2006, respectively, under plan.

Total local exchange revenues for incumbent LECs for 1999 were $71.3 billion compared with $6.5 billion in same year by CLECs, FCC said in report, “State-by-State Telephone Revenues and Universal Service Data,” released Fri. Report presents estimates of state telecommunications revenue and data on Universal Service Fund. Data were obtained from information filed with FCC by NECA and USAC and report gives summary data by state, by type of carrier and by service. Highlights include: (1) Total high-cost programs for 2000 amounted to $2.28 billion. (2) Total low-income support payments for Link Up and Lifeline Assistance programs for qualifying consumers in same year were $522 million. (3) Total communications revenues for mobile wireless carriers for 1999 totaled $6.5 billion. Report is available at FCC Reference Information Center, from International Transcription Services (202-857-3800) or at www.fcc.gov/ccb/stats (file name STATREV.ZIP or STATREV.PDF).

FCC declined to specify what Internet security measures schools and libraries must use in order to continue to receive E- rate funding for Internet facilities through Universal Service Fund (USF). In decision released Thurs., Commission said local communities should select appropriate security measures, schools and libraries didn’t have to certify the effectiveness of measures and they wouldn’t be liable if measures failed.

Coalition charged with coming to consensus on future of universal service offered policymakers 7 options for funding program in coming years as new technology makes current system less practical. In report Thurs., Consumer Energy Council of America (CECA) deliberately didn’t pick one of 7 options, saying Congress, FCC and Federal-State Joint Board on Universal Service should have full range of thinking by group. Broad-based organization included representatives of state and federal govt., consumer groups and wide variety of industry including long distance companies, incumbent LECs, CLECs and wireless providers. About 60 people were listed in report, although not all of them attended every meeting. Report will be submitted to FCC as ex parte filing and will be sent to key members of Congress.

Rather than moving immediately to subsidize advanced services as part of universal service program, FCC ought to form task force to determine “how and when” such services should be added, group of telecom experts will recommend in report to be issued today (April 5). Some 50 people, assembled by Consumer Energy Council of America (CECA), spent 6 months studying ways to improve universal service. Group decided that program was “vital to the social wellbeing of all Americans” and should be continued, but it stopped short of recommending expansion without more study. Instead it said Technology Task Force (TTF) should be formed to advise FCC and Federal-State Joint Board on Universal Service. Task force would be composed of “broad balance of stakeholders” to offer variety of viewpoints and would monitor development of advanced services on more continuous basis than is done now, CECA group recommended. Group, which is chaired by former White House and FCC official Kathleen Wallman, also recommended: (1) “Model state programs” for distributing low income support. (2) Better ways of publicizing low income support programs. (3) Streamlined process for gaining certification as eligible telecom carrier (ETC). State and federal regulators could work together to improve ETC process, CECA group said, using input from states that already have made improvements. (4) Program, coordinated by Universal Service Fund, to encourage deployment of advanced services through efforts of federal, state and local govts.

FCC hopes to take action on CLEC access charges “in the very near future,” Common Carrier Bureau Chief Dorothy Attwood told rural telephone executives attending National Telephone Cooperative Assn.’s annual Legislative Conference Wed. Issue has been “incredibly hard” for FCC, she said. On one hand, CLECs depend on that revenue to finance expansion, she said, and on other hand, long distance companies can’t afford to pay high rates because competition is driving down their end-user rates. “The worst answer is not to resolve [it],” she told group, saying she was aware that some NTCA members had CLEC operations that could be affected by FCC decision.

Rep. Deal (R-Ga.) introduced legislation that would remove caps and limitations on universal service support by amending Sec. 254 of Communications Act. HR-1171,referred March 22 to House Commerce Committee, is companion to S-500 (CD March 12 p6), by Sen. Burns (R-Mont.) and several rural senators. Bills would eliminate restrictions on size of high-cost support, lift caps on how much universal funding individual service providers could receive, prevent FCC from enforcing or reimposing most caps or limitations. National Telephone Cooperative Assn., which supports measure, estimates that “small, independent telecommunications carriers will lose out on $198 million this year if the caps are not removed.”

LAS VEGAS -- Wireless industry pitches for more spectrum were almost as prevalent at NTIA convention here as wireless calls themselves. Customer demand for wireless spectrum will exceed supply by 2004 or 2005, Verizon Wireless Vp-Legal Mark Tuller said, and industry will need twice as much spectrum by 2010. He said increasing spectrum efficiency and technology couldn’t meet demand, and key sources were likely to be military spectrum (1755- 1850 MHz) and 2 GHz bands used by MMDS and ITFS wireless communications and educational TV services.