$485 Million Available for Second Round of CAF Phase I Support
In the first major move under acting FCC Chair Mignon Clyburn, another $485 million in Connect America Fund Phase I money will be made available for fixed broadband expansion in unserved areas. Wednesday’s order, which leverages private investment and universal service funding, “will potentially connect hundreds of thousands of unserved consumers to robust broadband networks,” Clyburn said in a statement. The commission expects this to be the final round of Phase I funding, said the order approved 3-0 (http://fcc.us/10QCTsG). It said price-cap carriers will be allocated support “using the same allocations as in the first round of Phase I.” As expected (CD April 25 p1), carriers will get access to $300 million allocated for the second round of Phase I.
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"A $300 million budget should provide a reasonable amount to accommodate potential demand for funding that leverages private investment to accelerate deployment of broadband-capable infrastructure to consumers who can quickly be served in the near-term,” the order said. If demand exceeds that amount, the commission will dole out the unused $185 million from the first round. The funds are available only to price-cap carriers, which will face the same rules of the first round: Participants will get $775 per unserved location they pledge to connect to broadband. Changes this time around include carriers getting the option to accept more than their allocated support if other carriers decline theirs. Carriers will have 75 days to decide whether to take the money. In the first round, carriers only accepted $115 million of the available $300 million (CD July 26 p3).
The commission also expanded Phase I eligibility to include any location that currently lacks Internet service speeds of at least 3 Mbps down and 768 kbps up. But locations that already have “some level of Internet access” will get a lower amount of support, the order said. For locations that get more than 768 kbps/200 kbps but less than 3 Mbps/768 kbps, carriers will get $550 per location. The commission justified that lower figure by explaining that “less fiber should be needed to upgrade the locations with some form of Internet access, as they are likely to be closer to the central office or remote terminal."
Price-cap carriers applauded the new round of support. USTelecom President Walter McCormick said its members have pledged a commitment of private capital investment to match the CAF support accepted this year. “This private investment coupled with the $485 million in CAF funding will help to close the broadband gap in rural America,” he said. Windstream is “committed to extending robust broadband to as many rural consumers as feasible,” said Eric Einhorn, senior vice president-government affairs and strategy. “It is our sincere hope and belief that this order will enable life-transforming broadband access to hundreds of thousands of rural Americans."
Any census block that already got funding under the Broadband Initiatives Program or Broadband Technology Opportunities Program will face more stringent eligibility criteria. “It would be an inefficient use of public funds to provide government support to two different projects aimed at serving the same location,” the order said. If a carrier wants to satisfy its Phase I deployment obligations in those blocks, “it must certify that it has engaged in due diligence and reviewed publicly available data sources to ensure that the particular locations it plans to serve do not and will not receive funding under BIP or BTOP for the construction of a network meeting our broadband standards,” the order said. Nor can carriers satisfy Phase I obligations in blocks where it receives Phase II support, the order said.
A new challenge process (CD May 20 p11) will give parties 30 days to challenge carriers’ lists of which census blocks they intend to build out to. Carriers will get another 30 days to respond to those challenges.
CenturyLink will be eligible for $90 million in funding, the company said in a news release, the same amount it was allocated last time around. The telco is “evaluating how much of this CAF phase I, round 2 money the company will be able to accept and where it will be deployed,” a spokeswoman said. The company will also be spending an equal amount of its own capital over the next three years to deploy broadband service in rural America, she said.
"It’s heartening to see Chairwoman Clyburn true to her commitment to move important items forward,” said Harold Feld, Public Knowledge senior vice president. “The decision on how to allocate the CAF money was already made some time ago. Moving forward keeps the FCC on track in its ongoing efforts to address the continuing and urgent problem of rural broadband deployment.”