Forbearance Would Block Broadband USF Contributions
FCC Chairman Tom Wheeler may be moving toward basing net neutrality rules on Title II (see 1501070054), but how he goes about it has become intertwined with another controversial issue -- whether to require broadband customers to begin paying into the USF. If the FCC approves reclassification, and forbearance from Section 254, the agency could block its own ability to require broadband to contribute to the fund, an NTCA official told us. The group made the case to the agency last week. ITTA, which like NTCA has called for requiring broadband providers to begin contributing to the fund, also opposes forbearing from the section, said ITTA President Genny Morelli in an interview.
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The opposition to forbearing from the section puts the groups at odds with NCTA and Comcast, which have urged the agency, if it does reclassify, to forbear from all of Title II’s provisions. It’s the latest of several issues that have arisen as more of the net neutrality debate has shifted to forbearance (see 1412310041), including privacy protections (see 1501080050). The question of whether broadband would be subject to USF contributions is also one of the issues Wheeler said needed to be worked out, during a meeting with public interest advocates after President Barack Obama’s endorsement of the approach in November (see 1411140059). Neither NCTA nor Comcast commented Monday.
Both NTCA and ITTA oppose a Title II approach, said Mike Romano, NTCA senior vice president-policy, and Morelli, in separate interviews Monday. The issue, Romano said, is that Section 254 says that all “providers of telecommunications services should make an equitable and nondiscriminatory contribution to the preservation and advancement of universal service.” If the agency forbears from that, it “at least raises the question” whether the agency can recommend contributions from broadband providers, Romano said. At the least, “some folks may use that argument” to block a requirement to pay into the fund.
The commission in August asked the Federal-State Joint Board on Universal Service to examine USF contribution reform and report back by April 7 (see 1408080032). If the commission forbears from Section 254, the agency would have “effectively pre-judged and cut off all meaningful debate by the Joint Board and other stakeholders about how to ‘broaden the base,’“ Romano and NTCA CEO Shirley Bloomfield told Gigi Sohn, Wheeler’s special counsel-external affairs, Wednesday, according to an ex parte filing posted Friday in docket 14-28.
Forbearing from the section would ensure perpetuating “current program inequities by precluding the assessment on broadband connections,” Morelli said in an interview.
NARUC, which also has backed requiring broadband customers to begin paying into the USF, hasn’t taken a position on forbearance, General Counsel Brad Ramsay said. While saying he hadn’t examined the issue, Ramsay agreed forbearing from Section 254 would raise uncertainty. The “FCC’s authority to do what it wants vis-à-vis broadband and USF is on solid legal footing [without] forbearance,” he said in an email. Forbearance “certainly would at a minimum raise new issues.”
Commissioners Mike O’Rielly and Ajit Pai warned in November that reclassifying broadband would subject broadband users to universal service charges (see 1411140059). Neither commented Monday. NTCA officials told Sohn the impact on broadband customers of not forbearing from the section and requiring broadband contributions would be minimal. It said the impact on broadband users would be “far less than the price of a cup of coffee” and would reduce the rate paid by other kinds of customers contributing to USF. Given the growth of the USF, “how do you sustain the program only on long distance telephone and wireless customers [who currently contribute to the fund]?” Romano asked in an interview.