Today's Regulatory Mix: FCC E-Rate Funding Guidance, FCC Seeks Comment on 5G Fund Adjustment Factor

FCC E-Rate Funding Guidance 

The FCC has issued guidance to USAC on E-rate Competitive Bidding Rules for FY 2020.  Specifically, it reiterated the guidance previously communicated to USAC regarding the treatment of E-Rate applications for which the applicant mistakenly selected a drop-down menu option on its FCC Form 470 that did not fully reflect the services for which it intended to seek bids.  

For funding year 2020, the appropriate drop-down option for an applicant seeking bids for Internet access delivered to its premises is either “Leased Lit Fiber (with or without Internet access)” or “Internet Access and Transport Bundled (Non-Fiber).”5 The appropriate drop-down option for an applicant seeking bids on bulk Internet, which the applicant is responsible for transporting to its premises, is “Internet Access: ISP Service Only (No Transport Circuit Included).”  Last year, stakeholders asserted that some funding year 2019 applicants intended to seek bids for and ultimately applied for Internet access to their premises, but mistakenly sought bids using only the “Internet Access: ISP Service Only (No Transport Circuit Included)” drop-down menu option.  

Given the apparent confusion of some applicants regarding USAC’s drop-down menu options, the FCC directed USAC not to deny any applications or issue commitment adjustments for any application solely because the applicant selected the “Internet Access: ISP Service Only (No Transport Circuit Included)” drop-down menu option and subsequently selected on its FCC Form 471 a service that delivers Internet access to its premises. For such applications, it directed USAC not to find a competitive bidding violation so long as the applicant had otherwise complied with all of the Commission’s competitive bidding rules.

The FCC also released a Public Notice announcing the deferral of any changes to the FCC Form 470 drop-down menu options until funding year 2022 to allow schools and libraries to continue to focus their time and resources on responding to the COVID-19 pandemic without the added burden of having to familiarize themselves with a new form. 

FCC Seeks Comment on 5G Fund Adjustment Factor

The FCC issued a Public Notice seeking comment on adopting an adjustment factor for the 5G fund.  The adjustment factor is intended to account for the relative costs of serving areas that vary in terrain characteristics and potential business cases and to make the most difficult areas to serve more attractive at auction in order to encourage more bidding for these areas.  The FCC seeks comment on a proposed adjustment factor values as well as three economic analyses that informed its proposal.  Comments are due July 7, 2020; reply comments are due August 6, 2020.  

The proposed factors are as follows:

The explanation of the three terrain categories can be found in Appendix A: Terrain Elevation.  The explanation of the demand factors can be found in Appendix B: Economic Analyses Supporting the Proposed Adjustment Factor.

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The Regulatory Mix, Inteserra’s blog of telecom related regulatory activities, is a snapshot of PUC, FCC, legislative, and occasionally court issues that our regulatory monitoring team uncovers each day. Depending on their significance, some items may be the subject of an Inteserra Briefing.