FCC Hears It From Hill on Lifeline ETCs

Says state commissions can't be cut out of process

U.S. Senator Deb Fischer (R-Neb.), joined by two dozen of her Senate and House colleagues  have written FCC Chairman Tom Wheeler to say they are concerned about the FCC's reform of the Universal Service Fund Lifeline subsidy, which supports advanced communications service to low-income residents. They--nine Senators and 15 House members, all Republicans except for one, Rep. Brad Ashford--say they are specifically troubled by the FCC's preemption of the role of state commissions in verifying eligibility.

In the letter, the legislators take issue with what they say is the FCC's decision to "drastically curtail the important state role in preventing waste, fraud, and abuse."

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The FCC is proposing to create a new Eligible Telecommunications Carrier (ETC) designation for broadband providers--it is migrating the subsidy from phone to broadband--to be certified by the FCC. But the legislators say that expressly preempting state public service commissions from the designation process runs counter to the Communications Act and language that gives those commissions primary designation authority.

"The FCC may only perform this function where a carrier is not subject to the jurisdiction of a state commission," they argue, so Congress, not the FCC, would have to change that.

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"As 96 state public service commissioners noted in a recent letter to the FCC," they wrote, "when it comes to designating ETCs to participate in the Lifeline program, states are still the best cops on the beat."

The FCC is not preempting state commissions when it comes to voice service, but that is cold comfort for the legislators given that the FCC is phasing out Lifeline support for voice. "With the phase out of support for standalone voice service, the state role in designating ETCs will no longer exist by the end of that process."

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"Given that data about program eligibility for Lifeline is typically housed at the state level, it could be more efficient and cost-effective to allow states to continue serving as the primary verifiers of applicant eligibility," they concluded.

A deeply divided FCC voted March 31 to reform the Lifeline subsidy by applying it to stand-alone broadband. phasing out voice-only subsidies over time, and making associated other changes, like the ETC designation.