Consistent with the Commission’s recent efforts to eliminate outdated and unnecessary regulations, on June 11, 2025, the Wireline Competition Bureau issued a Public Notice inviting interested Parties to update the record on issues raised by the Commission in the 2020 NPRM regarding various end-user charges associated with interstate access service offered by incumbent local exchange carriers. These charges include the Subscriber Line Charge, the Access Recovery Charge, the Presubscribed Interexchange Carrier Charge, the Line Port Charge, and the Special Access Surcharge. In the 2020 NPRM, the Commission proposed eliminating ex ante pricing regulation for these charges and also proposed requiring local exchange carriers to detariff these charges. In addition, the NPRM proposed prohibiting carriers from billing customers for these charges through separate line items on their bills. The NPRM also addressed the fact that these end-user charges are used to calculate contributions to the USF and other federal programs. Comments and Reply Comments have now been filed in this proceeding.
While applauding the Commission’s deregulatory efforts and the elimination of unnecessary and outdated rules, NTCA in its comments proposed that the Commission should decline to mandate detariffing of the interstate end-user charges and should instead enable permissive detariffing driven by providers’ own evaluation of their market conditions. In addition, NTCA asserts that charges at issue and the underlying rules continue to serve a valuable purpose in promoting universal service, providing certainty to providers in high-cost rural areas, and reducing burdens associated with the recovery of regulated costs. NTCA’s comments express concerns as to the ability of carriers to otherwise recover the related revenue and specifically take exception to the implication that providers could simply make up any lost revenue by raising local service rates. Finally, NTCA observes that additional discussion and clarity are needed regarding contributions to the USF.
Comments were also filed by the Concerned Rural LECS, a group representing nearly 100 local exchange carriers. The Group urged the Commission to not deregulate and detariff the interstate end-user charges for Rate of Return ILECS as it would cause significant cost recovery issues for many carriers and would have implications on contributions to both the federal USF as well as state universal service funds. The Group point out that the charges at issue have been in place for an additional five years since the release of the 2020 NPRM and during this time carriers have not experienced any notable customer confusion regarding these charges. The Group also suggests that a reasonable alternative to mandatory deregulation would be permissive detariffing which would allow each carrier to determine the appropriate path for their unique circumstances.
The Pennsylvania Public Utilities Commission (PUC) also filed Reply Comments in this proceeding. The PUC cited jurisdictional concerns regarding the shifting of interstate cost recovery to the intrastate jurisdiction and questions the FCC’s statutory authority to do so. In addition, the PUC expressed concerns regarding contributions to the federal USF and potential negative impacts on the funding mechanism related to PA.’s state specific USF. Finally, the PUC requests that the FCC terminate the NPRM proceeding without taking any action or instead refer the issues to the Joint Federal-State Board on Separations and the Joint Federal-State Board on Universal Service for their consideration and the issuance of appropriate recommendations.
With Comments and Reply Comments now having been filed, it’s now in the Commission’s hands for further consideration and a potential ruling. We believe that the comments filed by interested Parties are compelling and present a strong argument that the Commission’s proposals in the NPRM should not be adopted. We will continue to monitor this issue and will provide updates as appropriate.
