NRECA supports the Federal Communications Commission’s plan to update universal rural broadband subsidies but has offered some recommendations to ensure communities served by electric cooperatives are not left behind.
“NRECA backs these goals by the FCC for universal service as our member electric co-ops are taking the lead in providing essential broadband services to unserved and underserved communities today,” said Brian O’Hara, NRECA senior regulatory director for telecom.
“But we are particularly sensitive to the challenges faced by rural communities that are struggling economically and lack high-speed internet access. To that end, we urge the commission to make key improvements to the Universal Service Fund that can answer those challenges.”
The FCC asked for comments as it prepares to update the rules governing its Universal Service Fund, which helps finance rural long-distance telephone, telehealth and internet for libraries and schools.
NRECA’s filing to the FCC on Feb. 17 included the following requests:
• Redefine broadband speed as 100 megabits per second for data upload and download, rather than the current outdated speed of 25/3 Mbps.
• Examine setting up a new or revised program to support ongoing operation and maintenance of broadband in high-cost rural areas.
• Establish a permanent program to address broadband affordability.
• Make USF contribution obligations more equitable and stabilize the program’s funding.
• Consider fixed terrestrial wireline broadband networks, rather than wireless broadband service, to be the measure of universal broadband.
NRECA told the FCC that it should examine whether a program to maintain networks in rural communities that are considered “high-cost” areas would better serve the goal of universal broadband. If the FCC decides to move forward with another round of deployment funding, then it should abandon the current “reverse auction” platform used in the $9.2 billion Rural Digital Opportunity Fund, NRECA said.
The reverse auction involves bidding on unserved census blocks identified by the FCC and awards the funds to the lowest bidder to connect the areas. But the process has been vulnerable to gamesmanship and defaults that prolong the lack of broadband in rural communities, O’Hara said.
“Some electric co-ops with solid fiber-to-the-home proposals were underbid by providers with much less reliable offerings to win millions of dollars in the RDOF,” O’Hara said. “NRECA urges the FCC to keep the door open for future capital funding and abandon the reverse auction format.”
The USF relies on a fee on monthly phone bills, but the pool of contributors is shrinking as landlines are disconnected and replaced with cellular or voice-over-internet service. As a result, the burden to sustain the fund falls on a smaller pool of consumers, including many residents of low-income rural areas.
NRECA suggested the FCC attach USF contributions to broadband service, which could drastically cut costs for rural phone customers, who pay up to 30% of their bill in USF surcharges.
“The Universal Service Fund is the single most comprehensive ongoing federal program to address the digital divide, but it needs updating,” said O’Hara. “If the FCC adopts our recommendations, the program will be able to meet the remaining challenges to closing the digital divide.”