States See FCC as MIA on Separations, but O'Rielly Touts 'Tremendous' Effort

Separations Joint Board Federal Chair Mike O'Rielly is "disappointed that Joint Board participants could not find common ground but it was not without a tremendous amount of time and effort on my part," the FCC commissioner emailed Tuesday. O'Rielly proposed a 15-year freeze extension in February (see 1802230019). "At the appropriate time, it became necessary to recognize that agreement was not going to be achieved and we moved forward accordingly. I am sure the Commission will provide any NARUC resolution the due consideration it deserves.” While the FCC item on extending the freeze "is still being considered by the Commission and is not public, it is important to note that issues involving the current freeze follow procedural precedents of being addressed by the Commission," he wrote.

Established when voice reigned telecom, separations assigned 75 percent of telecom costs as intrastate with state jurisdiction and 25 percent as interstate with federal jurisdiction, said Colorado Public Utilities Commissioner Wendy Moser, sponsor of the separations resolution. The FCC froze the factors in 2001, but interstate traffic increased dramatically with new services and technologies, she said. “The impact on consumers is that local customers in each state bear the costs, but the state may not receive the revenues, which means states have to pay more money out of their limited resources to cover costs that really should be in interstate jurisdiction.” Moser added that “more money would be available to support high-cost areas in the states if more costs were assigned to the interstate jurisdiction.”

Ending the separations freeze in two years is “very possible,” said Moser. “You don’t need 15 years ... The FCC could turn over three times or more in that time period.” The Colorado commissioner takes issue with the FCC announcing a freeze without working through the process jointly: “There’s been no dialogue. There’s been no incorporation of our views or the work that has been done by the board.”

Adopting a 15-year freeze is like “throwing up our hands,” said Separations Joint Board State Chair Sarah Hofmann, a member of the Vermont Public Utility Commission. Two years to update separations is realistic if the FCC works with states, she said. It makes no sense to freeze the policy for so long when there have been significant industry changes, agreed South Dakota Public Service Commissioner Chris Nelson.

State board members haven’t met with O’Rielly since the federal chair attended NARUC’s July 2017 meeting (see 1707190029), they said. State members “have done our work,” submitting a separations proposal after the meeting, but there’s not been time for another federal-state meeting, Moser said. States worked on ways forward, agreed Hofmann. “I’m disappointed there hasn’t been more back and forth between the two sides of the Joint Board.”

State officials are frustrated “the FCC appears to be ignoring their input,” said Nelson, who isn’t in the separations group but said he had a similar experience as chair of the USF Joint Board. Separations “deserves to be looked at from all perspectives, not just the perspective of FCC commissioners.” The FCC hasn’t invited USF Joint Board state members back to talk since O’Rielly met with them at last July's NARUC meeting, the South Dakota Republican said. State members submitted a USF revamp proposal to the FCC but haven’t heard back, he said. “The door to talk has been closed.”

Draft Resolutions

Another proposed resolution would seek application programming interfaces (API) in the Lifeline national verifier so carriers can help low-income fund recipients with the enrollment process.

Hofmann, the draft resolution’s sponsor, worries about mass consumer confusion if the national verifier rolls out without API, especially for seniors and people with disabilities. Vermont supported a national system after initially saying it was unnecessary, and “now I’m concerned with the way it’s happening,” she said. The FCC last month announced a soft launch in six states but hasn’t announced a date for 44 other states, said Hofmann, saying her expectation is 2019. “It does give us an opportunity to fix it.”

The FCC should probe whether carriers are pushing IP CTS services to people who could instead use less expensive services, a practice seen by state commissions, said Moser. She has a second draft resolution to ask the FCC to do more research into possible waste, fraud and abuse before adopting a June 8 plan to expand the IP CTS contribution base (see 1806080058). Moser noted IP CTS minutes have grown “astronomically” compared to other telecom relay service categories. USTelecom, NCTA and CTIA didn’t comment.

Nelson urged adoption of his draft resolution that would ask Congress to pass the Precision Agriculture Connectivity Act and ask the FCC to appoint state commissioners to the task force to be established by the bill. “In the old days, when you were getting ready to fertilize or to plant a 160-acre field, you’d treat the entire field identically,” irrespective of varying soil types and other differences within the plot, he said. “What precision agriculture has done is allow us really to break that 160-acre field down almost to the inch.” The task force would look at “what we can do to beef up the connectivity” in areas that can’t support such technology, and state commissioners should be included because they have “firsthand knowledge” of where it’s needed, he said.