In what should be considered very good news, U.S. Senator Roger Wicker, R-Miss, Chairman of the Senate Subcommittee on Communications, Technology, Innovation and the Internet, recently held a hearing to determine how to expand broadband services in rural America. The hearing focused specifically on the possibility of using the Universal Service Fund to accomplish this goal.
Senator Wicker praised the USF as a “primary mechanism” in bringing “universal communications services to rural and remote geographic areas.” But he also criticized the USF’s “inadequate data collection methods,” which cause “inefficient distribution of funds to truly underserved and unserved areas.”
To correct these problems, he and Senator Joe Manchin, D-WV, have introduced the Rural Wireless Access Act, which is intended to standardize USF data collection methods and ensure that support is properly distributed to those rural areas that are “actually in need.”
The necessity for Congressional involvement in rural broadband is underscored by some very disturbing statistics recently released by the NTCA – The Rural Broadband Association. It cited future reductions in USF support for small, rural network operators of some $173 million over the 12 months beginning July 1, 2017. In the past 9 months, FCC budget control has decreased USF support for small, rural broadband providers from 4.5%, to 9.1%, to 12.3%.
Shirley Bloomfield, NTCA’s Chief Executive Officer, provided these figures, and much more, in her very thoughtful and thorough testimony before the committee. She rightfully criticized the unpredictability of the FCC’s budget control process with its accompanying large decreases in support — dramatic reductions that both inhibit rural broadband investment and increase customer rates.
She suggested how Universal Service Funding might be used to increase rural broadband support, including the use of funds or reserves already collected but not disbursed for USF programs, or increasing the USF contribution factor by a small amount. Alternatively, she proposed that Congress might direct infrastructure funding to supplement, or at least be used in coordination with, the existing USF program.
There are very serious problems with USF support for rural broadband, including USAC’s questionable data collection and fund distribution efforts, which have been targeted in the proposed Rural Wireless Access Act. But an even more critical issue is the FCC’s unpredictable, investment-killing USF budget control mechanism, outlined in Ms. Bloomfield’s testimony and the NTCA report.
These flawed and arbitrary FCC actions threaten the continued provision of advanced universal broadband services, at reasonable rates, in many areas of rural America. Hopefully, Congress, NTCA and other industry groups will work with the Commission to find a solution – sooner rather than later.