FCC to Issue ‘Guidance’ on New USF Auditing Rules, Wireline Official Says
The FCC understands that some companies may not be able to meet newly imposed deadlines for auditing their books under new Universal Service Fund rules, Wireline Bureau Deputy Chief Carol Mattey said Thursday. “We are well aware of the challenges of companies that have not been able to submit to a financial audit,” Mattey said in a webinar hosted by USTelecom. “I do very much appreciate the time-sensitivity of it and I think we will be able to give some guidance on the timing of that. We recognize that certain things may not be able to be implemented by the deadline of this year.”
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Mattey declined to discuss specific measures the FCC will take to obviate the new burdens under last October’s reforms (CD Oct 28 p1). But she did acknowledge that several carriers have taken issue with the new reporting requirements of the new regime. She said she hoped carriers would bear in mind that the FCC wants to guarantee “accountability” with its new rules and therefore be constructive in their approach to the commission. “In particular, what would be helpful for us is for people to articulate what exactly is burdensome and why,” Mattey said. “In the petitions for reconsideration, we're going to be looking to have a dialogue. We're looking to hear whether people have specific alternative proposals to make sure that we have accountability, going forward."
The universal service order punted several questions and delegated several others to the bureaus. In the year ahead, FCC staffers hope to finalize benchmark methodologies for caps on rate-of-return carriers’ reimbursable expenses by July 1, hold the first reverse auctions by the third quarter and finish a cost model for broadband support by December, Mattey said. Comments on the cost models are due Feb. 1.
The earliest of this year’s new deadlines also comes up next month, when the FCC’s new traffic pumping rules take effect, Wireline Bureau staffer Rebecca Goodhart said. Under the rules, if an LEC has a revenue-sharing agreement in effect and its traffic volume spikes, the LEC must refile its tariff, justifying the increased volume, Goodhart said.
The FCC also “strongly urges” carriers to finish up exchange agreements on rates for local wireline/wireless exchanges before July 1, when the default rate will be bill-and-keep, Mattey said.
The new local wireline/wireless exchange deadline probably won’t set off any new rounds of negotiations, several telecom officials told us Thursday. “I don’t see how this particularly empowers wireline companies to force uneconomic intercarrier compensation agreements any more or less than in the past,” Rural Cellular Association President Steve Berry said in an email. “If, in fact, they're using this to squeeze out higher rates, then I'm sure it’s something the FCC will want to hear about. It’s unfortunate that the FCC did not adhere to their original transition to bill and keep that would have provided significant cost savings to wireless carriers. The good thing is that in 6 months the FCC’s recommendations will go into effect.”
Sixteen carriers have challenged the new USF rules in federal court, Mattey said Thursday. Another 20 carriers or groups have filed petitions for reconsideration and two carriers have asked for waivers from parts of the new rules, Mattey said.