JEFFERSON CITY, Mo. – Missouri Public Service Commissioner Scott Rupp submitted a letter to the Federal Communications Commission on Wednesday in response to the FCC seeking comment to rule changes of Phase II of the “Connect America Fund,” which will provide ongoing funding for 5 to 10 years to carriers to expand their broadband coverage into high cost areas.
The draft rule calls for funding for carriers accepting a statewide obligation for 5 years and is seeking comment of increasing the period to 7 years. Carriers want funding for 10 years to match what the rules have for auction winners should that occur. Eleven Missouri counties were assisted in Phase I, according to the FCC.
In a PSC agenda meeting on Wednesday, Rupp discussed his letter and the need for expanded broadband access in rural Missouri with PSC staff — who provide in-depth issue-based legal perspective. Their discussion clarified the process of expanding CAF into further census blocks and how CAF phase II would be implemented in Missouri.
Rupp’s letter called for a download speed up to 10 Mbps to be made a requirement by the FCC for CAF funding. Missouri’s CAF locations currently have a download/upload speed of 3Mpbs/768kbps, according to FCC’s website. The draft the FCC is seeking comment on changes the level of broadband speed from 5 Mbps to 10Mbps.
Rupp also called for increased broadband deployment flexibility for carriers that make a statewide commitment, so that the maximum number of Missouri households could benefit from CAF II. He said he is concerned the draft rules may discourage carriers to accept a statewide obligation, which will result in a significant delay in implementation as rules for the auction are determined and cause some areas to not receive broadband.
Large carriers, which currently provide telephone services to high cost areas, have a right of refusal under CAF phase II. If a carrier refuses the funding, and thus opts to not be the provider of expanded broadband in the carriers entire footprint within Missouri, the entire footprint is then opened up to other companies, including the refusing company, for competitive bidding through a reverse auction.
Rupp supports allowing price capped carriers some flexibility to shift funds from extremely high cost areas to deploy broadband in other areas which were not eligible simply because a few households in a census block had competition while many other homes in the census block do not have broadband choices and would be left without broadband going forward – being called substitution. Finally, he supports an accurate and thorough challenge process where such census blocks are only knocked out where competition exists.
Census blocks that qualify cannot currently have any locations that have broadband access over 10Mbps, which means that if one home in a census block of 1000 homes has access to broadband speeds of 10 mbps or higher, the entire block automatically does not qualify, limiting rural broadband expansion greatly.
In Missouri, assuming the FCC requires a 10 mbps download speed and price capped carriers take the statewide obligation, the rule would effect 280,845 homes and provide approximately $123 million per year for 5 or more years, which would all go towards expanding broadband.
Currently, there are state and federal programs, such as the Lifeline discount, funded by the Universal Service Fund and Intercarrier Compensation surcharges currently to assist voice customers with low income or disability. Once CAF II is implemented, the federal high cost voice fund will largely go away. Although allowed by Missouri law, the PSC has yet to implement a high cost voice fund to ensure universal access to phone service in Missouri, a concept currently being discussed at the PSC in light of the federal fund ending.
Rachael Herndon was the editor at The Missouri Times and also produced This Week in Missouri Politics, published Missouri Times Magazine, and co-hosted the #MoLeg podcast. She joined The Missouri Times in 2014, returning to political reporting after working as a campaign and legislative staffer.
Rachael studied at the University of Missouri – Columbia. She lives in Jefferson City with her husband, Brandon, and their two children.