The Uniendo a Puerto Rico Fund and the Connect USVI Fund, Connect America Fund, ETC Annual Reports and Certifications, 27528-27537 [2018-12625]
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particular statute or statutes? If so, please
provide examples.
III. Statutory and Executive Order
Reviews
Under Executive Order 12866,
entitled Regulatory Planning and
Review (58 FR 51735, October 4, 1993),
this is a ‘‘significant regulatory action’’
because the action raises novel legal or
policy issues. Accordingly, EPA has
submitted this action to the Office of
Management and Budget (OMB) for
review under Executive Order 12866
and any changes made in response to
OMB recommendations have been
documented in the docket for this
action. Because this action does not
propose or impose any requirements,
and instead seeks comments and
suggestions for the agency to consider in
possibly developing a subsequent
proposed rule, the various statutes and
Executive Orders that normally apply to
rulemaking do not apply in this case.
Should EPA subsequently determine to
pursue a rulemaking, EPA will address
the statues and Executive Orders as
applicable to that rulemaking.
Dated: June 7, 2018.
E. Scott Pruitt,
Administrator.
[FR Doc. 2018–12707 Filed 6–12–18; 8:45 am]
BILLING CODE 6560–50–P
FEDERAL COMMUNICATIONS
COMMISSION
47 CFR Part 54
[WC Docket Nos. 18–143, 10–90, 14–58; FCC
18–57]
The Uniendo a Puerto Rico Fund and
the Connect USVI Fund, Connect
America Fund, ETC Annual Reports
and Certifications
Federal Communications
Commission.
ACTION: Proposed rule.
AGENCY:
In this document, the Federal
Communications Commission
(Commission) seeks comment on how
best to structure the second stage of the
Uniendo a Puerto Rico and Connect
USVI Funds to speed longer-term efforts
to rebuild fixed and mobile voice and
broadband networks in the territories
and harden them against future natural
disasters. The Commission intends to
target high-cost support over the next
several years in a tailored and costeffective manner, using competitive
processes where appropriate.
DATES: Comments are due on or before
July 5, 2018 and reply comments are
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due on or before July 18, 2018. If you
anticipate that you will be submitting
comments, but find it difficult to do so
within the period of time allowed by
this document, you should advise the
contact listed in the following as soon
as possible.
ADDRESSES: You may submit comments,
identified by WC Docket Nos. 18–143,
10–90 and 14–58, by any of the
following methods:
• Federal eRulemaking Portal: https://
www.regulations.gov. Follow the
instructions for submitting comments.
• Federal Communications
Commission’s website: https://
fjallfoss.fcc.gov/ecfs2/. Follow the
instructions for submitting comments.
• People with Disabilities: Contact the
FCC to request reasonable
accommodations (accessible format
documents, sign language interpreters,
CART, etc.) by email: FCC504@fcc.gov
or phone: (202) 418–0530 or TTY: (202)
418–0432.
For detailed instructions for
submitting comments and additional
information on the rulemaking process,
see the SUPPLEMENTARY INFORMATION
section of this document.
FOR FURTHER INFORMATION CONTACT:
Alexander Minard, Wireline
Competition Bureau, (202) 418–7400 or
TTY: (202) 418–0484.
SUPPLEMENTARY INFORMATION: This is a
synopsis of the Commission’s Notice of
Proposed Rulemaking (Notice) in WC
Docket Nos. 18–143, 10–90, 14–58; FCC
18–57, adopted on May 8, 2018 and
released on May 29, 2018. The full text
of this document is available for public
inspection during regular business
hours in the FCC Reference Center,
Room CY–A257, 445 12th St. SW,
Washington, DC 20554 or at the
following internet address: https://
docs.fcc.gov/public/attachments/FCC18-57A1.pdf. The Order that was
adopted concurrently with the Notice is
published elsewhere in the Federal
Register.
I. Introduction
1. Through the Uniendo a Puerto Rico
Fund, the Commission will make
available up to $750 million of funding
to carriers in Puerto Rico, including an
immediate infusion of $51.2 million for
restoration efforts in 2018. Of the
remainder, the Commission proposes
that about $444.5 million would be
made available over a 10-year term for
fixed voice and broadband (an $84
million increase over current funding
levels) and that about $254 million
would be made available over a 3-year
term for 4G Long-Term Evolution (LTE)
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mobile voice and broadband (a $16.8
million increase).
2. Through the Connect USVI Fund,
the Commission will make available up
to $204 million of funding to carriers in
the U.S. Virgin Islands, including an
immediate infusion of $13 million for
restoration efforts in 2018. Of the
remainder, the Commission proposes
that about $186.5 million would be
made available over a 10-year term for
fixed broadband (a $21 million increase)
and that about $4.4 million would be
made available over a 3-year term for 4G
LTE mobile voice and broadband (a $4.2
million increase).
3. As a result of these Funds, as well
as the Commission’s decision not to
offset more than $65 million in advance
payments it made to carriers last year,
it will make available up to $256
million in additional high-cost support
for rebuilding, improving, and
expanding broadband-capable networks
in Puerto Rico and the Virgin Islands.
The Commission seeks comment on
how best to structure the second stage
of these Funds to speed longer-term
efforts to rebuild fixed and mobile voice
and broadband networks in the
territories and harden them against
future natural disasters. The
Commission intends to target high-cost
support over the next several years in a
tailored and cost-effective manner,
using competitive processes where
appropriate.
II. Notice: Stage 2 Funding for LongTerm Rebuilding
4. The Commission recognizes that a
longer-term solution is needed to
rebuild, improve, and expand service in
Puerto Rico and the U.S. Virgin Islands
given the widespread devastation to
communications networks caused by
the hurricanes. In this Notice, the
Commission proposes to establish
second stages for the Uniendo a Puerto
Rico Fund and the Connect USVI
Fund—one that would make available
about $699 million through the Uniendo
a Puerto Rico Fund and about $191
million through the Connect USVI
Fund.
5. As background, the USF currently
directs approximately $36 million each
year to fixed services in Puerto Rico and
$16 million each year to fixed services
in the U.S. Virgin Islands, along with
$79.2 million each year to mobile
services in Puerto Rico and only
$67,000 each year to mobile services in
the U.S. Virgin Islands. However, none
of this funding is tied to specific,
accountable build-out targets. The
Commission now seeks comment on
revisiting that spending to ensure there
is sufficient support for the long-term
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rebuilding of the territories and that
such support is distributed in a costefficient manner.
6. Based on the Commission’s
analysis, it proposes to spend up to an
additional $126 million through the
second stages of the Uniendo a Puerto
Rico Fund and the Connect USVI Fund.
Specifically, the Commission would
increase funding for fixed services by
$10.5 million per year over ten years
and for mobile services by $7 million
per year over three years to ensure that
carriers have sufficient funds to rebuild
and improve the voice and broadbandcapable networks, both where the
hurricanes destroyed existing
infrastructure and in rural areas that
have not yet been served. As result, the
Uniendo a Puerto Rico Fund would
make available about $444.5 million
over a decade for fixed broadband (an
$84 million increase over current
funding levels) and about $254 million
over 3 years for 4G LTE mobile
broadband (a $16.8 million increase).
And the Connect USVI Fund would
make available about $186.5 million
over a decade for fixed broadband (a $21
million increase) and about $4.4 million
over a 3-year term for 4G LTE mobile
broadband (a $4.2 million increase).
7. The Commission expects that this
support will provide meaningful relief
to carriers in the storm-ravaged
territories in a targeted and costeffective manner. The Commission
seeks comment on whether this budget
is appropriate and whether additional
support beyond current levels of highcost support is necessary to rebuild,
improve, and expand service in these
areas. Does the Commission’s proposed
allocation of additional high-cost
support between fixed and mobile
providers accurately reflect the costs
that each will face in restoring,
improving and expanding service? The
Commission also seeks comment on
whether and how to incorporate any
unclaimed restoration funding into its
long-term plan. Commenters are
requested to provide specific
information to substantiate their views.
8. The proposal for different terms of
support for fixed and mobile providers
reflects the Commission’s distinct goals
of providing longer-term support for
fixed services and restoring a
competitive environment for mobile
providers. And because the
Commission’s proposed long-term plan
treats fixed and mobile services in
different ways, it seeks more detailed
comment in the following on the
particulars of the plan for each type of
service.
9. More generally, the Commission
seeks comment on how to ensure that
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service is rebuilt quickly and efficiently,
while improving networks where
feasible and protecting critical
communications networks against
future natural disasters. Recognizing
that access to reliable communications
services is essential, particularly in
times of emergency, the Commission
also explores options to expand service
to areas that were unserved prior to the
hurricanes. The Commission invites
comment on how to balance its
competing objectives of rebuilding and
improving service, ensuring network
resiliency, and expanding coverage. At
the same time, the Commission is
mindful of its responsibility as stewards
of the USF to ensure that support is
spent efficiently and seek comment on
appropriate safeguards to ensure
accountability. Similar to Stage 1
funding, the Commission reminds
Puerto Rico and the U.S. Virgin Islands
that the Act prohibits the territories
from adopting regulations related to
Stage 2 funding that are ‘‘inconsistent
with the Commission’s rules to preserve
and advance universal service.’’
10. The long-term rebuilding,
improvement, and hardening of fixed
voice and broadband service is critical
in helping Puerto Rico and the U.S.
Virgin Islands recover from the
devastation caused by the hurricanes.
The Commission believes that
authorizing up to $105 million in
additional funds for rebuilding while
distributing all high-cost funding for
fixed networks through an incentivebased mechanism will best ensure that
networks are rebuilt, improved, and
expanded across the territories in an
efficient manner.
11. The Commission first notes that
present circumstances require them to
revisit the Commission’s past treatment
of high-cost support for fixed networks
in Puerto Rico and the U.S. Virgin
Islands. In the December 2014 Connect
America Fund Order, 80 FR 4446,
January 27, 2015, the Commission
decided to allow price-cap carriers in
insular areas to elect to continue
receiving frozen high-cost support
amounts in exchange for accepting
tailored service obligations to be
adopted at a later date. Although PRTC
(in Puerto Rico) and Viya (in the U.S.
Virgin Islands) elected to receive frozen
support, the Commission has yet to
establish specific service obligations for
either carrier. Moreover, the hurricanes
and their aftermath wrought havoc upon
these existing networks—so much so
that each of these carriers has claimed
that multiples of their current annual
support amounts are necessary for
restoration and rebuilding. The
Commission seeks comment on the view
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that changed circumstances require
them to revisit funding for fixed
networks in these territories. How does
the fact that the Commission has not
adopted specific CAF Phase II
obligations for PRTC and Viya impact
the reliance interests, if any, these
carriers could reasonably have had in
the status quo continuing through 2020?
How should the need for extensive
rebuilding factor into the Commission’s
decision? How should the fact that the
Commission is considering the addition
of $10.5 million in high-cost funding
per year for rebuilding fixed networks in
these territories affect its decision? And
how should the Commission weigh the
efficiency of more competitive
approaches that could extend improved
service more widely to consumers in
Puerto Rico and the U.S. Virgin Islands
against any reliance interests in
continuing to administer frozen support
as before?
12. Given the changed circumstances,
the Commission proposes to reconsider
the existing frozen high-cost support
mechanisms and replace them with a
competitive mechanism that would
allocate an additional $105 million to
fixed networks in the territories over a
decade. The Commission proposes to
allocate these support amounts so that
approximately 80 percent goes to the
Uniendo a Puerto Rico Fund and
approximately 20 percent to the
Connect USVI Fund. As a result, fixed
network operators in Puerto Rico would
have an opportunity to compete for
$444.5 million over the next decade and
fixed network operators in the U.S.
Virgin Islands would have an
opportunity to compete for $186.5
million over the next decade.
13. The Commission seeks comment
on this proposal. In the concurrently
adopted Order, the Commission used
the same 80–20 ratio to balance the
difference in population between Puerto
Rico and the U.S. Virgin Islands, the
significant financial challenges faced by
carriers in both areas, the current level
of high-cost support available to
providers, and other relevant factors.
Should the Commission maintain that
ratio for the purpose of allocating
additional support? Are the total
funding amounts appropriate for each
territory given the rebuilding required
and the improvements need to harden
networks against future natural disasters
and the expansion needed in rural
areas? Is a ten-year term of support,
which the Commission has repeatedly
used in other high-cost programs to
ensure those building out had sufficient
time to amortize and recover their costs,
appropriate here? How should the
Commission address differences in the
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geographic or competitive landscape in
evaluating its long-term plans? For
example, Viya is currently the only
fixed provider in the U.S. Virgin
Islands. Does that argue for requiring
inter-area competition as the
Commission does in the Connect
America Fund Phase II reverse auction?
Or is a quasi-competitive process on the
U.S. Virgin Islands nonetheless feasible?
Or should the Commission pursue some
alternative option?
14. The Commission also invites
comment on how to best promote its
aim of providing support quickly and
efficiently to speed the rebuilding,
improvement, and expansion of service.
How can the Commission ensure that
people living in the territories have
access to reasonably comparable,
affordable fixed voice services and
broadband-capable networks? And as
stewards of the USF, the Commission
seeks comment on how best to fulfill its
commitment to fiscal responsibility to
ensure that funds are targeted
efficiently.
15. As detailed in the following, the
Commission proposes to award highcost support using a competitive
proposal process, similar to a request for
proposal process. The Commission also
seeks comment on conducting an
auction, negotiating directly with ETCs,
and establishing build-out obligations
while continuing to provide frozen
high-cost support at current levels.
16. The Commission proposes to
award fixed support through the
Uniendo a Puerto Rico Fund and the
Connect USVI Fund by evaluating
competitive proposals submitted by
carriers. This approach could be
completed quickly and efficiently,
thereby avoiding lengthy delays in
getting critical funding to carriers. A
competitive proposal process is a more
streamlined approach than the typical
Commission auction, yet still requires
carriers to compete for support.
Moreover, this option may better enable
the Commission to determine how best
to award support for network-hardening
purposes than the auction approach.
17. The Commission proposes that
accepted proposals will receive support
for 10 years, beginning in January 2019
and running through December 2028.
The Commission seeks comment on
whether to transition support, through a
phase-down process, in any geographic
area where the incumbent carrier, i.e.,
PRTC or Viya, did not win support
based on its proposal. The Commission
provides additional details and seek
comment on them in the following.
18. Eligible Providers.—The
Commission proposes that only a
provider that, according to June 2017
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FCC Form 477 data, had an existing
fixed network and provided broadband
service in Puerto Rico or the U.S. Virgin
Islands prior to the hurricanes would be
eligible to apply to participate. The
Commission seeks comment on whether
participation should be limited to fixed
providers who served at least some
residential locations or whether
providers that served only business
locations should also be permitted to
participate. The Commission proposes
to limit participation to providers who
had provided services before the
hurricane because it believes they
would be better equipped to rebuild and
expand service as quickly as possible.
Relatedly, the Commission also believes
that existing providers with established
track records present a smaller risk of
defaulting on their service obligations.
However, the Commission seeks
comment on whether new entrants
should also be eligible. If so, what
particular qualifications if any should
the Commission impose on them?
19. The Commission further proposes
to evaluate the financial and technical
capabilities of the applicants through a
single-stage application process. Doing
so would minimize the amount of time
it takes to complete the competitive
proposal process and begin awarding
support. The Commission seeks
comment on whether to use instead the
two-phase application process of the
competitive bidding rules for universal
service in Part 1, Subpart AA of the
Commission’s rules, as it has done for
the CAF Phase II auction.
20. Consistent with the
Communications Act of 1934, as
amended, and the Commission’s rules, a
provider must be designated as an ETC
before receiving support. To the extent
necessary, the Commission proposes to
allow providers to obtain ETC
designations after winning support
rather than before participating in the
competitive proposal process, similar to
the approach it followed for the CAF
Phase II auction. The Commission seeks
comment on this approach. What
methods would be appropriate for
selecting another carrier if the winner
fails to timely obtain an ETC
designation?
21. Eligible Areas.—Given the unique
circumstances presented by the
widespread destruction of critical
infrastructure, the Commission proposes
to make eligible all of Puerto Rico. By
making the entire territory eligible, the
Commission would eliminate the need
to establish a challenge process and thus
enable a more expeditious completion
of the process. Doing so would also
encourage applicants to expand service
to areas that were previously unserved,
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in addition to restoring service to areas
that had service before the hurricanes.
Further, the Commission anticipates
that making all of Puerto Rico eligible
for support will increase competition,
driving down the support amounts
proposed in lower-cost areas. The
Commission seeks comment on this
approach. Similarly, the Commission
proposes to make eligible all of the U.S.
Virgin Islands and seek comment on
that approach.
22. Alternatively, the Commission
seeks comment on whether certain areas
should be excluded. For example, are
there areas where service has already
been rebuilt (or will be rebuilt by the
end of 2018)? Are there areas where
providing high-cost support to one
carrier would distort the competitive
market and reduce potential
competitors’ incentives to rebuild
service? How can the Commission
ensure consistency with its policy
against providing funding in areas
where there is an unsubsidized
competitor? Would the ability of other
carriers to bid for such support reduce
the funding in such areas to only what’s
needed to rebuild otherwise unserved
areas? Are there areas where support
levels would be so low as to be
unnecessary to rebuild and improve
service, such as census blocks in Puerto
Rico identified by the model as having
particularly low average monthly costs?
How can the Commission best achieve
its goal of maximizing the expansion of
service to unserved areas in addition to
restoring and improving service to areas
that had it before the hurricanes?
23. Minimum Geographic Area.—The
Commission proposes to accept
proposals for support to satisfy specific
service obligations within each of
Puerto Rico’s 78 municipios. Using
municipios as the basic geographic area
for support may allow providers to
achieve economies of scale that would
not be available if the Commission used
smaller areas, such as Puerto Rico’s over
900 barrios. On the other hand, there
may be some risk that municipios are
too large to target funding in a
competitively neutral manner—
incumbent providers with large existing
service territories are likely more
amenable to providing service over a
wider area. The Commission seeks
comment on whether using municipios
makes sense or whether it should
instead provide support on a more
granular basis, such as by barrios,
census block groups, or some other
geographic unit.
24. The Commission seeks comment
on the appropriate minimum geographic
area for support in the U.S. Virgin
Islands. Should the Commission treat
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the entire territory as one geographic
area to carry out this initiative? Or
should the Commission treat each
island in the U.S. Virgin Islands
separately for this purpose? Or would
using some other census-defined
geography such as census tract, census
block group, or census block be more
appropriate?
25. Number of Locations in Each
Geographic Area.—The Commission
proposes to identify the number of
locations in each geographic area by
using the Connect America Cost Model
(the CAM). The Commission seeks
comment on how it can best account for
the fact that people may have migrated
from Puerto Rico and the U.S. Virgin
Islands since the storms. The
Commission seeks comment on what
other sources of data would more
accurately model the number of
locations in each area. The Commission
also seeks comment on whether to
provide support based on only certain
locations within each geographic area,
such as those that are more costly to
serve, and whether to exclude certain
other locations from bidding, such as
those that are less costly and therefore
may not require high-cost support. The
Commission proposes, as a condition of
receiving support for funded locations,
that a winning bidder serve all locations
within a geographic area, not just those
funded (if the Commission decides to
fund just a subset of locations). This
proposal comports with the
Commission’s decision to focus on
rebuilding all networks and make all of
Puerto Rico eligible for bidding, rather
than only discrete areas. Alternatively,
the Commission seeks comment on
limiting the obligation only to funded
locations or locations in census blocks
identified by the model as being above
a certain funding benchmark?
26. Given possible changes in the
number of locations post-hurricane and
the difficulties in obtaining more recent,
accurate data, the Commission also
seeks comment on whether to instead
evaluate proposals to serve all the
locations in a municipio without
determining exactly how many
locations that represents. In other
words, applicants would commit to
serve all locations in a municipio rather
than to serve a specific number. The
Commission also seeks comment on
whether differences in municipio
characteristics, such as quantity of high
cost locations or remoteness, should
lead the Commission’s to attach
different obligations to funding so as to
better ensure all parts of the territories
are provided with service.
27. Furthermore, if the data the
Commission eventually adopts
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overestimates the number of locations in
an area, it seeks comment on what
flexibility to offer winning applicants.
Should the Commission, for example,
reduce support on a pro rata basis if it
lowers the number of locations a
provider must serve, and if so, what
requirements and limitations should the
Commission establish for such
reductions? Should the Commission
consider giving providers more
flexibility here than it has in other
contexts given the facilities lost and the
recent emigration from the territories?
28. Reserve Prices.—The Commission
proposes to use a three-step process to
set reserve prices. First, the Commission
would employ the cost model used to
establish support for price cap carriers
(the CAM) to calculate the average cost
per location of all locations in a census
block. Second, the Commission would
set separate high-cost and extremely
high-cost thresholds for Puerto Rico and
the U.S. Virgin Islands to ensure the full
amount of funding available to each
territory over the ten-year period is
available for obligation. Third, the
Commission would establish a reserve
price for each minimum geographic area
based on the sum of the support
amounts calculated for each eligible
census block in that municipio. Under
the proposal, WCB would release the
reserve price and number of locations
for all eligible areas by public notice no
later than 30 calendar days before the
application deadline to submit
competitive proposals.
29. The Commission seeks comment
on this proposal, and particularly on the
key second step. The Commission notes
that the extremely high-cost threshold
here would be used to establish a perlocation funding cap, similar to how the
Commission offered rate-of-return
carriers model-based support. How
should the Commission establish the
appropriate thresholds? The CAM
established a high-cost threshold of
$52.50 based on assumed take rates and
potential average revenues per
subscriber. Do those assumptions still
hold in the context of Puerto Rico and
the U.S. Virgin Islands after the
hurricanes? If not, should the
Commission lower the high-cost
threshold and if so, by how much? By
25 percent? By more? The CAM
established a high-cost threshold of
$198.60. Is that appropriate here? The
Puerto Rico Telecommunications
Regulatory Board has stated that more
support needs to be directed to the rural
parts of the island. Would that suggest
setting a higher extremely high-cost
threshold? The Commission also seeks
comment on how to allocate funds
between bringing service to locations
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that had never been served versus
restoring service (potentially at a lower
cost) to locations where service had
been disrupted by the hurricanes. For
example, the Commission has
previously assigned zero support to
locations below the high-cost threshold
on the assumption that a business case
nonetheless existed to serve such
locations. Does the context of rebuilding
networks on these islands suggest
revisiting that assumption and assigning
some funding—say 10 percent of cost—
to cover the costs below the high-cost
threshold? The Commission also seeks
comment on how the CAM should be
adjusted, if at all, to take into account
the need for network hardening. For
example, should the Commission
assume the cost of above-ground plant
will increase 10 percent (or more) to
account for such hardening before it
determines the costs per location?
30. Selection Process.—The
Commission seeks comment on the
appropriate time frame and format for
submitting proposals. The Commission
proposes to allow confidential
proposals. Should the Commission
unseal proposals after finishing the
evaluations process for transparency
reasons? The Commission seeks
comment on whether to make public the
submitted proposals after the evaluation
process has been completed and
winning applicants have been
determined. The Commission seeks
comment on prohibiting multiple
carriers from submitting a proposal
jointly.
31. The Commission proposes to
select winning proposals based
primarily on price per-location served
while adjusting the bids to consider
factors including network resiliency,
network deployment timing, and
network performance. The Commission
seeks comment on these factors and
what other factors it should consider
when evaluating proposals. Considering
price as the primary factor responsibly
manages the Fund, but the Commission
recognizes the increased costs of
deploying a storm-hardened network in
Puerto Rico and the USVI. For instance,
how should the Commission factor
storm hardening proposals into the
Commission’s evaluation? Should the
Commission require or increase the
weight of bids that comply with
resiliency standards like TIA–222–H,
the most up-to-date standard for
antenna supporting structures, with best
practices promulgated by the FCC’s
Communications Security, Reliability
and Interoperability Council, or with
another industry used standard for
network resiliency? Should the
Commission establish weights to
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account for the speed of deployment?
What weight would be appropriate to
balance costs against encouraging
prompt deployment to the territories?
Should the Commission establish
weights to account for proposals
offering ‘‘higher speeds over lower
speeds, higher usage allowances over
lower usage allowances, and lower
latency over higher latency’’? If so, what
weighting scheme would be appropriate
for that purpose? Instead of using
specific weights could the Commission
define preferences for various
characteristics in the proposals? If the
Commission does not require proposals
to identify a specific number of
locations to serve, what factors should
it consider in comparing proposals?
32. How should the Commission
address package bidding? For example,
should the Commission allow package
bidding? If so, what limits if any should
the Commission put on packages (e.g.,
should the Commission require all
packages to be contiguous or limit the
number of minimum geographic areas
included in the package)? If selecting
two package bids would be the most
efficient outcome even if they
overlapped in a particular geographic
area, should the Commission accept
both (perhaps requiring the less efficient
bidder to redirect support from the
overlapped area to other unserved areas)
or reject the less efficient package
(perhaps leaving no bidder for some
areas)?
33. How should the Commission
evaluate bids? Should the Commission
direct USAC or WCB to evaluate bids?
The Commission proposes directing the
reviewer to evaluate the bids in
accordance with the selection criteria,
methodology and bidding process
outlined above. Once that initial
evaluation is complete, should the
Commission make selections or offer
feedback to applicants and allow them
to return with best-and-final offers? Or
would that introduce undue discretion
into the process or create additional
administrative burdens or delays? If a
dissatisfied applicant wants to challenge
its non-selection, would existing
appeals processes be sufficient?
34. How should the Commission
address areas without bids? One
approach would be to invite a second
round of competitive proposals, with
the difference between bids and reserve
prices in the first round being
transferred to raise the reserve price of
remaining areas (pro rata) in the second
round. In other words, if the reserve
price for areas won in the first round
were $10 million and only $8 million
was bid, then $2 million would be
available to raise the reserve prices in
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areas remaining in the second round.
The Commission seeks comment on this
approach, including whether it would
be vulnerable to potential
gamesmanship by bidders.
35. In addition, as a backstop, the
Commission proposes to require the
incumbent carrier to continue to
provide service to any unawarded areas
using frozen high-cost support—with
corresponding service obligations to be
determined by the Commission after the
competitive proposal process is
complete. The Commission notes that
for this and other purposes (such as any
transitional payments) it would allocate
an incumbent carrier’s existing frozen
support across their service territory in
proportion to the reserve prices the
Commission initially set for the
competitive proposal process. The
Commission believes this backstop
would place incumbent carriers in no
worse a position then they are in today,
with frozen support and accompanying
service obligations to be determined by
the Commission.
36. Service Obligations.—In addition
to voice service, the Commission
proposes to require support recipients to
offer broadband service meeting the
following metrics: Download/upload
speeds of at least 10/1 megabits per
second (Mbps), roundtrip latency of no
greater than 100 milliseconds (ms), and
a minimum usage allowance of the
higher of 170 GB per month or one that
reflects the average usage of a majority
of consumers, using Measuring
Broadband America data or a similar
data source.
37. The Commission seeks comment
on whether these obligations are
appropriate. Should the Commission,
for instance, require some portion of the
areas served to receive 25/3 Mbps
service? And, if so, what fraction would
be appropriate? Should the Commission
impose different requirements for areas
based on the amount of support
allocated?
38. Further, the Commission proposes
requiring each support recipient to offer
broadband service in its supported area
at rates that are reasonably comparable
to rates offered for comparable services
in urban areas. Rates will be considered
reasonably comparable if they are ‘‘at or
below the applicable benchmark to be
announced annually by public notice
issued by the Wireline Competition
Bureau.’’ Based on the results of the
Urban Rate Survey, the Commission
sees no reason to adopt a different
benchmark specific to Puerto Rico or the
U.S. Virgin Islands. The Commission
seeks comment on this approach.
39. Deployment Milestones.—As with
the CAF Phase II Auction, the
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Commission proposes that winning
bidders must deploy to at least 40
percent of locations after the third year
of support, at least 60 percent after the
fourth, at least 80 percent after the fifth,
and 100 percent after the sixth year of
support. The Commission seeks
comment on whether this schedule is
appropriate. The Commission also seeks
comment on how it should track
milestones if a particular number of
locations, as already discussed, is not
defined. Are there other ways to track
progress without having to rely on
location counts given the possible
difficulty of establishing a number of
locations?
40. Oversight and Accountability
Measures.—The Commission has an
obligation to ensure that carriers receive
support ‘‘only for the provision,
maintenance, and upgrading of facilities
and service for which the support is
intended’’ as required by section 254(e)
of the Act. The Commission has
exercised its oversight obligations in a
variety of way since inception of the
fund. In the following, the Commission
proposes various oversight and
accountability measures that, taken
together, serve the public interest by
enhancing the Commission’s ability to
monitor the use of USF and ensure its
use for intended purposes.
41. First, the Commission proposes
that support recipients must satisfy all
reporting and certification obligations of
providers receiving CAF Phase II
auction support, including as described
in sections 54.313 and 54.316 of the
Commission’s rules. The Commission
seeks comment on this proposal. The
Commission seeks comment on whether
providers who win support must track
their restoration expenditures. Should
providers retain documentation on how
much support was used for capital
expenditures and operating
expenditures? What are the associated
burdens with retaining expenditure
documentation? Would retention of this
documentation be duplicative of records
needed for deployment milestones?
42. Second, the Commission proposes
aligning the annual reporting
obligations with the obligations of other
rate-of-return carriers in the 2016 Rateof-Return Order, 81 FR 24282, April 25,
2016, by requiring geocoded location
reporting into the HUBB. This reporting
obligation would require providers to
submit information demonstrating
locations the provider is reporting as
broadband-enabled where the company
is prepared to offer voice and broadband
service meeting the requisite
performance standards. Do carriers
currently retain geolocation data for
served locations? If not, what period of
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time is needed to enable collection of
geolocation data? Should the
Commission require this data be
reported for only newly deployed
locations or all reported locations?
Would annual reporting or a longer
period more appropriately balance the
reporting burden against the accuracy of
the data? Additionally, the Commission
proposes requiring awarded carriers to
submit performance measurements in
accordance with the requirements to be
defined by the Commission. To the
extent that awarded carriers have not
participated in that proceeding, the
Commission proposes requiring the
same testing method options and
parameters as price cap carriers.
43. Third, the Commission proposes
to carefully monitor and reassess the
deployment obligations of the awarded
support before the end of the fifth year.
Understanding the deployment and
operational realities of providing service
in both Puerto Rico and the U.S. Virgin
Islands, the Commission believes this
reassessment would be prudent to
address any changed circumstances
within the territories, whether that be
changes in subscribership expectations
due to population changes or future
disruptive natural disasters. As the
current situation demonstrates, the longterm planning involved in any
telecommunications deployment
decision requires a number of
assumptions that may change
dramatically over time. Would
providing an opportunity for the
Commission to reassess deployment
obligations be beneficial to providers or
cause unneeded uncertainty? Should
the reassessment be tied to deployment
milestones? For example, the
reassessment would not be triggered if
a provider is 60 percent deployed after
four years, but would occur if a provider
failed to meet the deployment
obligation. Would it be appropriate to
alter the obligations by increasing or
decreasing the number of locations or
modifying the service obligations?
44. Fourth, the Commission proposes
to subject awarded carriers to the same
compliance standards as any other
carrier with defined obligations by
defining specific obligations for the
support. This may result in a carrier that
failed to meet its milestones having
support reduced until the carrier can
meet its obligations or face recovery
actions. The Commission seeks
comment on this approach.
45. The Commission also seeks
comment on whether successful
applicants must obtain a letter of credit
by way of security, as must winning
bidders in the CAF Phase II auction. If
so, how should the letter of credit be
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structured? Should it be for the full
amount awarded, or some lesser amount
that will nevertheless protect the USF?
Should an alternative to a letter of credit
be considered, such as a performance or
payment bond?
46. Fifth, the Commission proposes to
subject all awarded carriers in the
territories to ongoing oversight by the
Commission and USAC to ensure
program integrity and prevent waste,
fraud, and abuse. The Commission has
a longstanding audit program that is
continually updated to respond to the
Commission’s needs inclusive of
changes in program requirements, new
guidance from GAO and OMB, and
changes in law. Accordingly, the
Commission proposes that all awarded
carriers would be subject to random
compliance audits and other
investigations to ensure compliance
with program rules and orders. The
Commission seeks comment on what
sorts of audit procedures the
Commission should undertake to
confirm that support has been spent on
allowed restoration costs. The
Commission also seeks comment on
whether there are specific
circumstances facing carriers in the
territories that require modifying the
current audit practices.
47. As an alternative to the
competitive proposal process, the
Commission seeks comment on using an
auction for the second stages of the
Uniendo a Puerto Rico Fund and the
Connect USVI Fund. The Commission
notes that it cannot simply apply the
same rules of the CAF Phase II Auction
here because it seeks to achieve
different goals. Among other
differences, here the Commission
wishes to rebuild networks, including in
areas where a business case existed prehurricane for providing service, whereas
in the CAF Phase II context, the
Commission aims to maintain and
expand service where there is no such
business case.
48. Instead, the Commission seeks
comment on using a single-round sealed
bid auction to award support. Such an
approach generally would award
support on a per-location basis, based
on the lowest price. Bidders would
identify a per-location support price at
which they are willing to meet
Commission requirements to cover the
locations in each eligible area they
specify. Bids would then be ranked,
lowest to highest, and support would be
assigned to those areas with the lowest
bid amounts submitted (and within each
assigned area, to the lowest bidder),
until no further bids can be
accommodated under the budget. The
terms of such an auction would
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otherwise largely track the terms for the
competitive proposal process described
above.
49. The Commission seeks comment
on whether the competitive
environment in Puerto Rico is
sufficiently robust to ensure an auction
that distributes funds in a cost-effective
way. The Commission seeks comment
on whether to use an auction process to
distribute funds in Puerto Rico, but not
in the U.S. Virgin Islands, given that
FCC Form 477 data shows that Viya is
currently the only fixed provider there.
50. Are there any specific auction
rules or procedures the Commission
should consider so that an auction
would not be overly complicated for the
Commission to administer and would
not overly burden potential bidders? Is
there an auction design the Commission
could use that would achieve its
objective of maximizing consumer
benefits? Would this approach afford
the same flexibility as a competitive
proposal process?
51. The Commission seeks comment
on whether to structure the second
stages based on carrier-submitted
proposals to rebuild, improve, and
expand service in the territories. Such
proposals would not be evaluated on a
competitive basis, but would be the
result of negotiation between the
Commission and carriers. Given
similarly unique circumstances, the
Commission adopted a framework based
on carrier commitments to maintain and
expand the availability of service in
Alaska.
52. Like the competitive proposal
option, through this process the
Commission seeks to maximize the
number of locations where fixed voice
and broadband services would be
available in a targeted and cost-effective
manner. As with any method of
awarding of support, the Commission
expects to hold providers accountable to
use support for its intended purposes
and to meet the deployment
commitments it set.
53. To the extent the Commission
adopts this approach, it seeks comment
on the process by which it would seek
proposals, review them, and award
support. The Commission anticipates
establishing the specific criteria by
which it would award support and
measure compliance by Public Notice,
along with a time frame for submitting
proposals. The Commission invites
comment on this approach.
54. In the Universal Service
Transformation Order, 76 FR 73830,
November 29, 2011, the Commission
allowed price cap carriers serving
specific non-contiguous areas of the
United States—including Puerto Rico
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and the U.S. Virgin Islands—to maintain
frozen support levels for those carriers
if, in the Bureau’s determination, certain
conditions were met. Recognizing that
these carriers faced different operating
conditions and challenges compared to
carriers in the contiguous 48 states, the
Bureau invoked its discretion. Both
PRTC and Viya elected to continue
receiving frozen support, with the
Commission responsible for adopting
specific service obligations tailored to
the individual circumstances of each
carrier.
55. As the Commission has not yet
adopted CAF II obligations for the
frozen support that PRTC and Viya
continue to receive, it seeks comment
on whether to forego reconsidering the
Commission’s prior decisions and
instead simply adopt specific service
obligations to reflect the frozen-support
amounts PRTC and Viya currently
receive. If the Commission pursues this
alternative, what obligations would be
appropriate and feasible? Should the
Commission establish particular
expectations regarding expanding
service to new areas or implementing
more resilient networks?
56. In the aftermath of the hurricanes,
the rapid restoration of mobile service
was critical in facilitating
communications with public safety and
civic officials and connecting families to
loved ones. Building upon the
significant restoration efforts that have
taken place to date, the Commission
seeks comment on how best to target
high-cost support to rebuild, improve,
harden, and expand mobile services in
Puerto Rico and the U.S. Virgin Islands.
The Commission proposes to make $259
million in support available to eligible
facilities-based mobile providers over
the next three years through the
Uniendo a Puerto Rico Fund and the
Connect USVI Fund. The Commission’s
goal is to facilitate timely recovery of
mobile services within these territories
in a cost-effective manner.
57. The Commission notes that it has
previously targeted Puerto Rico and the
U.S. Virgin Islands as potential areas
eligible for the upcoming MF–II auction.
However, the Commission recognized in
December that conditions in the
territories after the hurricanes made
establishing reliable coverage of mobile
networks infeasible in the near term. As
such, the Commission waived the filing
deadline for mobile providers to submit
4G LTE coverage information for a
period of 180 days or until the
Commission took action addressing the
appropriate approach, given the
circumstances, for providing ongoing,
high-cost support for mobile services in
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Puerto Rico and the U.S. Virgin Islands,
whichever occurred earlier.
58. The Commission now proposes to
extend that waiver, exempt these mobile
providers from filing this coverage
information, and carve Puerto Rico and
the U.S. Virgin Islands out from the
MF–II auction. Instead, the Commission
proposes to supplement existing
support over a three-year period by
giving providers an additional $21
million to rebuild their networks after
the destruction wrought by Hurricanes
Irma and Maria and their aftermath. The
Commission seeks comment on
allocating these support amounts so that
approximately 80 percent goes to the
Uniendo a Puerto Rico Fund and
approximately 20 percent to the
Connect USVI Fund. As a result, over
the next three years, the Uniendo a
Puerto Rico Fund would make available
$254.4 million to mobile network
operators and the Connect USVI Fund
would make available $4.4 million to
mobile network operators. These
territories currently face serious and
continuing challenges in restoring their
mobile communications capacity, and
the Commission tentatively concludes
that this additional funding will allow
providers in these territories to repair
the damage caused by the hurricanes to
their wireless networks as well as make
their networks more resilient to future
natural disasters.
59. The Commission seeks comment
on this proposal. In the concurrently
adopted Order, the Commission used
the same 80–20 ratio to balance the
difference in population between Puerto
Rico and the U.S. Virgin Islands, the
significant financial challenges faced by
carriers in both areas, the current level
of high-cost support available to
providers, and other relevant factors.
Should the Commission maintain that
ratio for the purpose of allocating
additional support? Are the total
funding amounts appropriate for each
territory given the rebuilding required
and the improvements need to harden
networks against future natural disasters
and the expansion needed in rural
areas? Is a three-year term of support
appropriate here? How should the
Commission address differences in
historic universal service funding in
evaluating its long-term plans? For
example, mobile carriers in the U.S.
Virgin Islands receive almost no funding
today. Does that argue for allocating
most of the new funding there? Or
should the Commission redistribute all
funding across both territories setting
aside historic allocations?
60. The Commission proposes that
only providers that provided facilitiesbased mobile services in Puerto Rico
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and the U.S. Virgin Islands prior to the
hurricane impacts, according to the June
2017 Form 477 data, would be eligible
to elect this new funding. The
Commission proposes to allocate the
new funding based on the number of
subscribers (voice or broadband internet
access service) each provider served as
of June 30, 2017—similar to how the
Commission calculates support in stage
one. As an alternative, the Commission
seeks comment on allocating all funding
available for mobile network operators
in the second stages of the Uniendo a
Puerto Rico Fund and the Connect USVI
Fund based on pre-hurricane
subscribership. Such an approach
would avoid any inefficiencies in the
historic allocation of support among the
islands and avoid the need for a
decision ahead of time regarding how
much in particular should go to Puerto
Rico versus the U.S. Virgin Islands. If
the Commission pursues this alternative
approach, should the Commission set
transitional funding amounts for
existing recipients of high-cost support?
In particular, should the Commission
ensure that existing recipients receive at
least two-thirds of their current mobile
support in 2019 and at least one third
in 2020?
61. The Commission proposes that, in
exchange for accepting additional
support, each mobile provider must
commit to, at minimum, a full
restoration of its pre-hurricane coverage
area, at a level of service that meets or
exceeds the minimum standard required
of recipients of MF–II support. Such a
requirement aligns with the goal of MF–
II to ‘‘target universal service funding to
support the deployment of the highest
level of mobile service available today—
4G LTE.’’ The Commission tentatively
concludes that, given the extent of
damage in Puerto Rico and the U.S.
Virgin Islands, most providers will
already be engaging in substantial
rebuilding of towers and infrastructure,
and will find it most economical to
deploy 4G LTE during such restoration
versus alternative technologies. The
Commission seeks comment on whether
this requirement is appropriate. Should
the Commission instead require
providers to rebuild their networks at a
different standard? For example, should
the Commission instead require
deployment at the speed benchmark
used to identify areas eligible for MF–
II? Is there an alternative standard
appropriate to ensure that residents of
Puerto Rico and the U.S. Virgin Islands
have comparable service to other areas
of the United States? Should the
Commission restrict funding to support
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operation, deployment, and
enhancement only of 4G LTE?
62. The Commission also seeks
comment on whether the Uniendo a
Puerto Rico Fund and the Connect USVI
Fund should include requirements to
expand service. Are there areas, for
instance, that lacked coverage before the
hurricanes and that the Commission
should nonetheless require providers to
serve? How should such areas be
identified and how should the
Commission determine what carriers
should be required to serve them? The
Commission seeks comment on how
quickly rebuilding could be
accomplished and what milestones
might be appropriate to complete build
out. Is three years of funding for
rebuilding appropriate? Why or why
not?
63. The Commission also seeks
comment on the appropriate reporting
requirements for support recipients. The
Commission proposes to have any
mobile providers receiving second-stage
support via the Uniendo a Puerto Rico
Fund and the Connect USVI Fund
report twice per year on their coverage.
Specifically, the Commission proposes
that providers supply coverage maps
using the buildout parameters the
Commission will adopt for the MF–II
auction. If the Commission adopts a
different service requirement for
funding recipients than the minimum
standard required of recipients of MF–
II support, it proposes to make
appropriate adjustments to the reporting
requirements. The Commission seeks
comment on these proposals. The
Commission also seeks comment on
how this data should best be submitted
to the Commission, such as through the
regular Form 477 filings or some other
process?
64. As noted above, the Commission
has an obligation to ensure that carriers
receive support ‘‘only for the provision,
maintenance, and upgrading of facilities
and service for which the support is
intended’’ as required by section 254(e)
of the Act. The Commission seeks
comment on appropriate oversight and
accountability measures for carriers that
receive additional high-cost support as
proposed in this Notice. The
Commission proposes that recipients of
such funds conform to the annual
reporting requirements the Commission
adopted for MF–II. The Commission
also proposes that all support recipients
be subject generally to the same audit
requirements as recipients of CAF–II
support and all other high-cost support.
The Commission seeks comment on
whether any other oversight or
accountability measures are appropriate.
Should the Commission require carriers
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to submit one or more Milestone
Reports to demonstrate progress on
service restoration? Would it be
beneficial for the Commission or USAC
to make use of independent testing to
determine service speed, quality, and
reliability in these areas?
65. The Commission proposes to use
an auction to allocate funding following
this three-year period, with any funding
commitments resulting from such an
auction to commence on the day
following the end of the three-year
period. The Commission seeks comment
on whether the competitive
environment in Puerto Rico and the U.S.
Virgin Islands is sufficiently robust to
ensure an auction that distributes funds
in a cost-effective way and whether it
makes sense from the perspective of
administrative efficiency to hold such
an auction. Can the Commission use the
same general auction rules and same
auction design for this auction as it will
use for the MF–II auction? Are there any
specific auction rules or procedures the
Commission should consider so that an
auction would not be overly
complicated for the Commission to
administer and would not overly burden
potential bidders?
66. If the Commission were to use an
auction to allocate funding, how should
it determine which areas would be
eligible to win support in the auction?
Should the Commission consider an
area eligible if it does not meet the
speed and technical parameters used to
identify areas eligible for MF–II? Should
the Commission adopt additional or
alternative specifications for eligibility
that would be more suitable for Puerto
Rico and the U.S. Virgin Islands? For
example, should an area be eligible if,
despite meeting a certain download
speed requirement, it does not meet
certain network resiliency requirements,
e.g. hardening to hurricane impacts? If
so, what resiliency requirements would
be appropriate? In this document, the
Commission proposes that providers
supply coverage maps using the
technical parameters buildout
parameters the Commission will adopt
for the MF–II auction. Would that
coverage information suffice for
determining areas eligible for an
auction, or is additional data required,
such as a one-time data collection using
the MF–II Challenge process technical
parameters? If so, when should the
Commission collect that data to ensure
that funding commitments can begin on
schedule?
67. Several parties have proposed that
rebuilt networks be ‘‘storm hardened.’’
The Commission seeks comment on
whether the Uniendo a Puerto Rico
Fund and the Connect USVI Fund
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should require second-stage participants
to improve the ability of their facilities
and equipment to resist hurricanes and
other natural disasters. If so, should the
Commission require compliance with
resiliency standards like TIA–222–H,
the most up-to-date standard for
antenna supporting structures or with
best practices promulgated by the FCC’s
Communications Security, Reliability
and Interoperability Council? Are there
other industry standards that would
help improve resistance to flooding,
wind damage, and water damage? How
should any such requirements be
enforced? What are the expected costs of
deploying a ‘‘storm hardened’’ network,
and how should the Commission
evaluate the costs and benefits of any
such network? Should the Commission
consider requiring hardening of certain
key network assets, but not the entire
network? If so, how should key assets be
identified? Would requiring hardening
only of assets sufficient to provide voice
and basic data service be appropriate?
What level of data service would be
appropriate? Are costs associated with
back-up power endurance, backhaul
resiliency, physical infrastructure
resiliency, recovery plans, and/or
redundant or alternate network
implementations appropriate in this
context? Should the Commission
instead allow carriers to include in their
proposals how and to what degree they
would harden their networks, and factor
that information into the evaluation of
proposals?
68. The Commission also proposes to
require second-stage participants to
provide more detailed information to
support tracking of recovery efforts.
Although mobile carriers already
provide information on coverage (but
not signal strength, antenna alignment,
and throughput) on a biannual basis
through FCC Form 477, that information
does not reveal the real-time status of
communications systems in the
aftermath of a disaster. Carriers
currently have the option to provide
information about the status of their
infrastructure via the Commission’s
voluntary Disaster Information
Reporting System (DIRS), and it
proposes to require carriers who accept
USF funding through the Uniendo a
Puerto Rico Fund and the Connect USVI
Fund to participate in DIRS. The
Commission seeks comment on this
proposal and on the data that DIRS
should seek. Would it be appropriate to
require mobile carriers to provide
coverage maps, signal strength, antenna
alignment, and throughput on a periodic
basis in DIRS? How often should these
reports be provided? Would it be
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appropriate to require coverage maps at
a more granular boundary value, for
example -98 dBm to reflect indoor
coverage for both voice and data? Would
it be appropriate to require carriers to
include information about disruptions
to backhaul? Should the DIRS data
contain more information about the
customers’ experience with their mobile
service, for example by including more
information about the condition of
backhaul? If so, at what intervals? What
are the costs and benefits of requiring
additional reporting? When might it be
appropriate to relieve carriers of any
enhanced reporting requirements?
69. The Commission anticipates that
any second-stage mobile participants in
the Uniendo a Puerto Rico Fund and the
Connect USVI Fund would continue to
adhere to the current post-disaster
resiliency framework for some time and
seek comment on when that framework
should and should not apply. First, are
there common metrics used across
providers to determine whether and
when to open roaming capabilities?
Should the Commission no longer
expect adherence to the framework
when coverage has been rebuilt to prehurricane levels? If so, should there be
a minimum level of service associated
with such coverage? Alternatively,
would a set time period for continued
adherence, such as one year, be more
appropriate and reduce administrative
burden? If so, what time period would
be appropriate? Finally, should a similar
framework be adopted for fixed
providers?
70. The Commission also anticipates
that any second-stage participants in the
Uniendo a Puerto Rico Fund and the
Connect USVI Fund would coordinate
any construction and access issues with
other carriers and state and federal
agencies to minimize duplicative
facilities, hardening, construction,
digging, and other activity. The
Commission believes that such
coordination could help rebuild service
in these areas more quickly and
efficiently. The Commission seeks
comment on whether voluntary
coordination is sufficient or if it should
adopt specific requirements.
Commenters should identify specific
carrier obligations and a framework for
coordination. If the Commission
adopted requirements, are there any
reporting obligations that would be
appropriate to ensure cooperation?
71. Finally, the Commission
understands that much of Puerto Rico
still lacks electrical power.
Communications networks require
reliable power to operate. The
Commission seeks comment on what
obligations providers should bear to
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ensure that their networks can function
even when the electrical power grid is
down. For instance, the Commission
seeks comment on whether carriers
could run their networks using energy
sources readily available in Puerto Rico
and the U.S. Virgin Islands that do not
need to be shipped from elsewhere. The
Commission seeks comment on the
applicable costs of sustainable back-up
power. What are the costs of
maintaining generators on-site versus
using portable generators? What are the
costs and additional considerations of
obtaining renewable back-up power
versus traditional power methods?
72. Finally, the Commission seeks
comment on other alternatives.
73. The Commission seeks comment
on a petition filed by PRTC on January
19, 2018, asking the Commission to
‘‘create a $200 million emergency
Universal Service Fund designated to
facilitate restoration of service in insular
areas by [ETCs] in Puerto Rico.’’ PRTC’s
request encompasses support for both
fixed and mobile providers in Puerto
Rico. It suggests the Commission
distribute funds ‘‘based on a percentage
of the consumer service disruption
credits provided by facilities-based
ETCs to end user customers’’ or ‘‘in
proportion to the total number of lines
each facilities-based ETC restores during
the next twelve months.’’ The
Commission seeks specific comment on
whether additional short-term funding
is necessary for Puerto Rico given the
actions it takes in the concurrently
adopted Order. If the Commission were
to pursue such relief, how could it
ensure that any funds are well spent? Do
carriers regularly offer ‘‘service
disruption credits,’’ or do different
carriers offer different options to their
consumers? And would such an
emergency fund create a perverse
incentive of rewarding those carriers
that had greater service disruptions vis`
a-vis those that recovered more quickly
from the hurricanes?
74. The Commission also seeks
comment on the petition filed by Viya
proposing a one-time infusion of $45
million in support to help it rebuild its
fixed network in the U.S. Virgin Islands,
the petition filed by Viya on October 5,
2017, that sought ‘‘a supplemental, onetime infusion of up to $50 million for
carriers to rebuild wireless networks
using hurricane-hardened facilities’’ in
the U.S. Virgin Islands, and the petition
filed by Open Mobile seeking additional
high-cost support and an advance on its
support payments. The Commission
seeks specific comment on whether
additional short-term funding is
necessary for the U.S. Virgin Islands
given the actions it takes in the
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Sfmt 4702
concurrently adopted Order. If the
Commission were to pursue such relief,
how could it ensure that any funds are
well spent?
III. Procedural Matters
A. Initial Paperwork Reduction Act
75. This document contains proposed
information collection requirements.
The Commission, as part of its
continuing effort to reduce paperwork
burdens, invites the general public and
the Office of Management and Budget
(OMB) to comment on the information
collection requirements contained in
this document, as required by the
Paperwork Reduction Act of 1995,
Public Law 104–13. In addition,
pursuant to the Small Business
Paperwork Relief Act of 2002, Public
Law 107–198, see 44 U.S.C. 3506(c)(4),
the Commission seeks specific comment
on how it might further reduce the
information collection burden for small
business concerns with fewer than 25
employees.
76. Initial Regulatory Flexibility
Certification. The Regulatory Flexibility
Act of 1980 as amended (RFA) requires
that a regulatory flexibility analysis be
prepared for rulemaking proceedings,
unless the agency certifies that ‘‘the rule
will not have a significant economic
impact on a substantial number of small
entities.’’ The RFA generally defines
‘‘small entity’’ as having the same
meaning as the terms ‘‘small business,’’
‘‘small organization,’’ and ‘‘small
governmental jurisdiction.’’ In addition,
the term ‘‘small business’’ has the same
meaning as the term ‘‘small business
concern’’ under the Small Business Act.
A small business concern is one which:
(1) Is independently owned and
operated; (2) is not dominant in its field
of operation; and (3) satisfies any
additional criteria established by the
Small Business Administration (SBA).
77. This Notice proposes annual
support to rebuild, improve, and expand
fixed and mobile services in Puerto Rico
and the U.S. Virgin Islands. The Notice
proposes making support available to
any fixed or mobile provider who
obtains an ETC designation, using a
competitive and subscriber-based
process, respectively. Ten fixed and
mobile carriers in Puerto Rico and the
U.S. Virgin Islands currently receive
high-cost support. Even assuming other
carriers will obtain an ETC designation
to receive part of the additional support
proposed by the Notice, the Commission
does not anticipate the proposed rule to
affect more than 15 providers out of the
737 providers currently receiving highcost support. Accordingly, the
Commission anticipates that this Notice
E:\FR\FM\13JNP1.SGM
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Federal Register / Vol. 83, No. 114 / Wednesday, June 13, 2018 / Proposed Rules
will not affect a substantial number of
carriers, and so it does not anticipate
that it will affect a substantial number
of small entities. Therefore, the
Commission certifies that this Notice
will not have a significant economic
impact on a substantial number of small
entities. See 5 U.S.C. 605(b).
78. Comments. All comments to this
Notice should be filed in WC Docket No.
18–143, The Uniendo a Puerto Rico
Fund and the Connect USVI Fund.
IV. Ordering Clauses
79. Accordingly, it is ordered,
pursuant to the authority contained in
sections 4(i), 214, 254, 303(r), and 403
of the Communications Act of 1934, as
amended, 47 U.S.C. 154(i), 214, 254,
303(r), and 403, and sections 1.1, 1.3,
and 1.412 of the Commission’s rules, 47
CFR 1.1, 1.3, and 1.412, Notice of
Proposed Rulemaking is adopted. The
Notice is effective thirty (30) days after
publication of the text or summary
thereof in the Federal Register.
80. It is further ordered that pursuant
to applicable procedures set forth in
sections 1.415 and 1.419 of the
Commission’s Rules, 47 CFR 1.415,
1.419, interested parties may file
comments on the Notice on or before
July 5, 2018, and reply comments on or
before July 18, 2018.
Federal Communications Commission.
Marlene Dortch,
Secretary.
[FR Doc. 2018–12625 Filed 6–12–18; 8:45 am]
BILLING CODE 6712–01–P
FEDERAL COMMUNICATIONS
COMMISSION
47 CFR Part 73
[MB Docket No. 18–153, RM–11801; DA 18–
496]
Television Broadcasting Services;
Block Island and Newport, Rhode
Island
Federal Communications
Commission.
ACTION: Proposed rule.
AGENCY:
The Commission has before it
a petition for rulemaking filed by Ocean
State Television, LLC (Petitioner or
OST), licensee of television station
WPXQ–TV, channel 17, Block Island,
Rhode Island (WPXQ). WPXQ operates
on channel 17 on a shared basis with
commercial television station WLWC,
New Bedford, Massachusetts, also
amozie on DSK3GDR082PROD with PROPOSALS1
SUMMARY:
VerDate Sep<11>2014
16:45 Jun 12, 2018
Jkt 244001
licensed to OST. OST requests an
amendment of the DTV Table of
Allotments to delete channel 17 at Block
Island, Rhode Island, and substitute
channel 17 at Newport, Rhode Island.
Petitioner also requests modification of
WPXQ’s license to specify Newport as
its community of license pursuant to
agency rules. The Petitioner asserts that
substantial public interests weigh
heavily in favor of reallocating WPXQ to
Newport. Newport has a population of
24,027 while Block Island’s population
consists of approximately 1,000.
Petitioner asserts that the proposed
reallotment will cause no public harm
because Block Island will not only
continue to be served by five full-power
commercial and one full-power noncommercial television stations, but will
also continue to receive the exact same
over-the-air service from Petitioner that
they are receiving currently. The
proposal would result in a preferential
allotment by providing Newport with its
first local full-power television services
in satisfaction of the Commission’s
second allotment priority, which is also
consistent with Commission precedent
and consistent with the public interest.
DATES: Comments must be filed on or
before July 13, 2018, and reply
comments on or before July 30, 2018.
ADDRESSES: Federal Communications
Commission, Office of the Secretary,
445 12th Street SW, Washington, DC
20554. In addition to filing comments
with the FCC, interested parties should
serve counsel for petitioner as follows:
Ocean State Television, LLC, c/o Cooley
LLP, John R. Feore, Jr., Esq., Jason
Rademacher, Esq., 1299 Pennsylvania
Avenue NW, Suite 700, Washington, DC
20004.
FOR FURTHER INFORMATION CONTACT:
Darren Fernandez, Darren.Fernandez@
fcc.gov, phone 202–418–2769, Video
Division, Media Bureau.
SUPPLEMENTARY INFORMATION: This is a
synopsis of the Commission’s Notice of
Proposed Rule Making, MB Docket No.
18–153, adopted May 14, 2018, and
released May 15, 2018. The full text of
this document is available for public
inspection and copying during normal
business hours in the FCC’s Reference
Information Center at Portals II, CY–
A257, 445 12th Street SW, Washington,
DC 20554. This document will also be
available via ECFS (https://www.fcc.gov/
cgb/ecfs/). (Documents will be available
electronically in ASCII, Word 97, and/
or Adobe Acrobat.) To request this
document in accessible formats
PO 00000
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Sfmt 9990
27537
(computer diskettes, large print, audio
recording, and Braille), send an email to
fcc504@fcc.gov or call the Commission’s
Consumer and Governmental Affairs
Bureau at (202) 418–0530 (voice), (202)
418–0432 (TTY). This document does
not contain proposed information
collection requirements subject to the
Paperwork Reduction Act of 1995,
Public Law 104–13. In addition,
therefore, it does not contain any
proposed information collection burden
‘‘for small business concerns with fewer
than 25 employees,’’ pursuant to the
Small Business Paperwork Relief Act of
2002, Public Law 107–198, see 44 U.S.C.
3506(c)(4).
Provisions of the Regulatory
Flexibility Act of 1980 do not apply to
this proceeding. Members of the public
should note that from the time a Notice
of Proposed Rule Making is issued until
the matter is no longer subject to
Commission consideration or court
review, all ex parte contacts (other than
ex parte presentations exempt under 47
CFR 1.1204(a)) are prohibited in
Commission proceedings, such as this
one, which involve channel allotments.
See 47 CFR 1.1208 for rules governing
restricted proceedings.
For information regarding proper
filing procedures for comments, see 47
CFR 1.415 and 1.420.
List of Subjects in 47 CFR Part 73
Television.
Federal Communications Commission.
Barbara A. Kreisman,
Chief, Video Division, Media Bureau.
Proposed rules
For the reasons discussed in the
preamble, the Federal Communications
Commission proposes to amend 47 CFR
part 73 as follows:
PART 73—RADIO BROADCAST
SERVICES
1. The authority citation for part 73
continues to read as follows:
■
Authority: 47 U.S.C. 154, 303, 334, 336,
and 339.
§ 73.622
[Amended]
2. Section 73.622(i), the PostTransition Table of DTV Allotments
under Rhode Island is amended by
adding channel 17 at Newport and
removing channel 17 at Block Island.
■
[FR Doc. 2018–12657 Filed 6–12–18; 8:45 am]
BILLING CODE 6712–01–P
E:\FR\FM\13JNP1.SGM
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Agencies
[Federal Register Volume 83, Number 114 (Wednesday, June 13, 2018)]
[Proposed Rules]
[Pages 27528-27537]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-12625]
=======================================================================
-----------------------------------------------------------------------
FEDERAL COMMUNICATIONS COMMISSION
47 CFR Part 54
[WC Docket Nos. 18-143, 10-90, 14-58; FCC 18-57]
The Uniendo a Puerto Rico Fund and the Connect USVI Fund, Connect
America Fund, ETC Annual Reports and Certifications
AGENCY: Federal Communications Commission.
ACTION: Proposed rule.
-----------------------------------------------------------------------
SUMMARY: In this document, the Federal Communications Commission
(Commission) seeks comment on how best to structure the second stage of
the Uniendo a Puerto Rico and Connect USVI Funds to speed longer-term
efforts to rebuild fixed and mobile voice and broadband networks in the
territories and harden them against future natural disasters. The
Commission intends to target high-cost support over the next several
years in a tailored and cost-effective manner, using competitive
processes where appropriate.
DATES: Comments are due on or before July 5, 2018 and reply comments
are due on or before July 18, 2018. If you anticipate that you will be
submitting comments, but find it difficult to do so within the period
of time allowed by this document, you should advise the contact listed
in the following as soon as possible.
ADDRESSES: You may submit comments, identified by WC Docket Nos. 18-
143, 10-90 and 14-58, by any of the following methods:
Federal eRulemaking Portal: https://www.regulations.gov.
Follow the instructions for submitting comments.
Federal Communications Commission's website: https://fjallfoss.fcc.gov/ecfs2/. Follow the instructions for submitting
comments.
People with Disabilities: Contact the FCC to request
reasonable accommodations (accessible format documents, sign language
interpreters, CART, etc.) by email: [email protected] or phone: (202) 418-
0530 or TTY: (202) 418-0432.
For detailed instructions for submitting comments and additional
information on the rulemaking process, see the SUPPLEMENTARY
INFORMATION section of this document.
FOR FURTHER INFORMATION CONTACT: Alexander Minard, Wireline Competition
Bureau, (202) 418-7400 or TTY: (202) 418-0484.
SUPPLEMENTARY INFORMATION: This is a synopsis of the Commission's
Notice of Proposed Rulemaking (Notice) in WC Docket Nos. 18-143, 10-90,
14-58; FCC 18-57, adopted on May 8, 2018 and released on May 29, 2018.
The full text of this document is available for public inspection
during regular business hours in the FCC Reference Center, Room CY-
A257, 445 12th St. SW, Washington, DC 20554 or at the following
internet address: https://docs.fcc.gov/public/attachments/FCC-18-57A1.pdf. The Order that was adopted concurrently with the Notice is
published elsewhere in the Federal Register.
I. Introduction
1. Through the Uniendo a Puerto Rico Fund, the Commission will make
available up to $750 million of funding to carriers in Puerto Rico,
including an immediate infusion of $51.2 million for restoration
efforts in 2018. Of the remainder, the Commission proposes that about
$444.5 million would be made available over a 10-year term for fixed
voice and broadband (an $84 million increase over current funding
levels) and that about $254 million would be made available over a 3-
year term for 4G Long-Term Evolution (LTE) mobile voice and broadband
(a $16.8 million increase).
2. Through the Connect USVI Fund, the Commission will make
available up to $204 million of funding to carriers in the U.S. Virgin
Islands, including an immediate infusion of $13 million for restoration
efforts in 2018. Of the remainder, the Commission proposes that about
$186.5 million would be made available over a 10-year term for fixed
broadband (a $21 million increase) and that about $4.4 million would be
made available over a 3-year term for 4G LTE mobile voice and broadband
(a $4.2 million increase).
3. As a result of these Funds, as well as the Commission's decision
not to offset more than $65 million in advance payments it made to
carriers last year, it will make available up to $256 million in
additional high-cost support for rebuilding, improving, and expanding
broadband-capable networks in Puerto Rico and the Virgin Islands. The
Commission seeks comment on how best to structure the second stage of
these Funds to speed longer-term efforts to rebuild fixed and mobile
voice and broadband networks in the territories and harden them against
future natural disasters. The Commission intends to target high-cost
support over the next several years in a tailored and cost-effective
manner, using competitive processes where appropriate.
II. Notice: Stage 2 Funding for Long-Term Rebuilding
4. The Commission recognizes that a longer-term solution is needed
to rebuild, improve, and expand service in Puerto Rico and the U.S.
Virgin Islands given the widespread devastation to communications
networks caused by the hurricanes. In this Notice, the Commission
proposes to establish second stages for the Uniendo a Puerto Rico Fund
and the Connect USVI Fund--one that would make available about $699
million through the Uniendo a Puerto Rico Fund and about $191 million
through the Connect USVI Fund.
5. As background, the USF currently directs approximately $36
million each year to fixed services in Puerto Rico and $16 million each
year to fixed services in the U.S. Virgin Islands, along with $79.2
million each year to mobile services in Puerto Rico and only $67,000
each year to mobile services in the U.S. Virgin Islands. However, none
of this funding is tied to specific, accountable build-out targets. The
Commission now seeks comment on revisiting that spending to ensure
there is sufficient support for the long-term
[[Page 27529]]
rebuilding of the territories and that such support is distributed in a
cost-efficient manner.
6. Based on the Commission's analysis, it proposes to spend up to
an additional $126 million through the second stages of the Uniendo a
Puerto Rico Fund and the Connect USVI Fund. Specifically, the
Commission would increase funding for fixed services by $10.5 million
per year over ten years and for mobile services by $7 million per year
over three years to ensure that carriers have sufficient funds to
rebuild and improve the voice and broadband-capable networks, both
where the hurricanes destroyed existing infrastructure and in rural
areas that have not yet been served. As result, the Uniendo a Puerto
Rico Fund would make available about $444.5 million over a decade for
fixed broadband (an $84 million increase over current funding levels)
and about $254 million over 3 years for 4G LTE mobile broadband (a
$16.8 million increase). And the Connect USVI Fund would make available
about $186.5 million over a decade for fixed broadband (a $21 million
increase) and about $4.4 million over a 3-year term for 4G LTE mobile
broadband (a $4.2 million increase).
7. The Commission expects that this support will provide meaningful
relief to carriers in the storm-ravaged territories in a targeted and
cost-effective manner. The Commission seeks comment on whether this
budget is appropriate and whether additional support beyond current
levels of high-cost support is necessary to rebuild, improve, and
expand service in these areas. Does the Commission's proposed
allocation of additional high-cost support between fixed and mobile
providers accurately reflect the costs that each will face in
restoring, improving and expanding service? The Commission also seeks
comment on whether and how to incorporate any unclaimed restoration
funding into its long-term plan. Commenters are requested to provide
specific information to substantiate their views.
8. The proposal for different terms of support for fixed and mobile
providers reflects the Commission's distinct goals of providing longer-
term support for fixed services and restoring a competitive environment
for mobile providers. And because the Commission's proposed long-term
plan treats fixed and mobile services in different ways, it seeks more
detailed comment in the following on the particulars of the plan for
each type of service.
9. More generally, the Commission seeks comment on how to ensure
that service is rebuilt quickly and efficiently, while improving
networks where feasible and protecting critical communications networks
against future natural disasters. Recognizing that access to reliable
communications services is essential, particularly in times of
emergency, the Commission also explores options to expand service to
areas that were unserved prior to the hurricanes. The Commission
invites comment on how to balance its competing objectives of
rebuilding and improving service, ensuring network resiliency, and
expanding coverage. At the same time, the Commission is mindful of its
responsibility as stewards of the USF to ensure that support is spent
efficiently and seek comment on appropriate safeguards to ensure
accountability. Similar to Stage 1 funding, the Commission reminds
Puerto Rico and the U.S. Virgin Islands that the Act prohibits the
territories from adopting regulations related to Stage 2 funding that
are ``inconsistent with the Commission's rules to preserve and advance
universal service.''
10. The long-term rebuilding, improvement, and hardening of fixed
voice and broadband service is critical in helping Puerto Rico and the
U.S. Virgin Islands recover from the devastation caused by the
hurricanes. The Commission believes that authorizing up to $105 million
in additional funds for rebuilding while distributing all high-cost
funding for fixed networks through an incentive-based mechanism will
best ensure that networks are rebuilt, improved, and expanded across
the territories in an efficient manner.
11. The Commission first notes that present circumstances require
them to revisit the Commission's past treatment of high-cost support
for fixed networks in Puerto Rico and the U.S. Virgin Islands. In the
December 2014 Connect America Fund Order, 80 FR 4446, January 27, 2015,
the Commission decided to allow price-cap carriers in insular areas to
elect to continue receiving frozen high-cost support amounts in
exchange for accepting tailored service obligations to be adopted at a
later date. Although PRTC (in Puerto Rico) and Viya (in the U.S. Virgin
Islands) elected to receive frozen support, the Commission has yet to
establish specific service obligations for either carrier. Moreover,
the hurricanes and their aftermath wrought havoc upon these existing
networks--so much so that each of these carriers has claimed that
multiples of their current annual support amounts are necessary for
restoration and rebuilding. The Commission seeks comment on the view
that changed circumstances require them to revisit funding for fixed
networks in these territories. How does the fact that the Commission
has not adopted specific CAF Phase II obligations for PRTC and Viya
impact the reliance interests, if any, these carriers could reasonably
have had in the status quo continuing through 2020? How should the need
for extensive rebuilding factor into the Commission's decision? How
should the fact that the Commission is considering the addition of
$10.5 million in high-cost funding per year for rebuilding fixed
networks in these territories affect its decision? And how should the
Commission weigh the efficiency of more competitive approaches that
could extend improved service more widely to consumers in Puerto Rico
and the U.S. Virgin Islands against any reliance interests in
continuing to administer frozen support as before?
12. Given the changed circumstances, the Commission proposes to
reconsider the existing frozen high-cost support mechanisms and replace
them with a competitive mechanism that would allocate an additional
$105 million to fixed networks in the territories over a decade. The
Commission proposes to allocate these support amounts so that
approximately 80 percent goes to the Uniendo a Puerto Rico Fund and
approximately 20 percent to the Connect USVI Fund. As a result, fixed
network operators in Puerto Rico would have an opportunity to compete
for $444.5 million over the next decade and fixed network operators in
the U.S. Virgin Islands would have an opportunity to compete for $186.5
million over the next decade.
13. The Commission seeks comment on this proposal. In the
concurrently adopted Order, the Commission used the same 80-20 ratio to
balance the difference in population between Puerto Rico and the U.S.
Virgin Islands, the significant financial challenges faced by carriers
in both areas, the current level of high-cost support available to
providers, and other relevant factors. Should the Commission maintain
that ratio for the purpose of allocating additional support? Are the
total funding amounts appropriate for each territory given the
rebuilding required and the improvements need to harden networks
against future natural disasters and the expansion needed in rural
areas? Is a ten-year term of support, which the Commission has
repeatedly used in other high-cost programs to ensure those building
out had sufficient time to amortize and recover their costs,
appropriate here? How should the Commission address differences in the
[[Page 27530]]
geographic or competitive landscape in evaluating its long-term plans?
For example, Viya is currently the only fixed provider in the U.S.
Virgin Islands. Does that argue for requiring inter-area competition as
the Commission does in the Connect America Fund Phase II reverse
auction? Or is a quasi-competitive process on the U.S. Virgin Islands
nonetheless feasible? Or should the Commission pursue some alternative
option?
14. The Commission also invites comment on how to best promote its
aim of providing support quickly and efficiently to speed the
rebuilding, improvement, and expansion of service. How can the
Commission ensure that people living in the territories have access to
reasonably comparable, affordable fixed voice services and broadband-
capable networks? And as stewards of the USF, the Commission seeks
comment on how best to fulfill its commitment to fiscal responsibility
to ensure that funds are targeted efficiently.
15. As detailed in the following, the Commission proposes to award
high-cost support using a competitive proposal process, similar to a
request for proposal process. The Commission also seeks comment on
conducting an auction, negotiating directly with ETCs, and establishing
build-out obligations while continuing to provide frozen high-cost
support at current levels.
16. The Commission proposes to award fixed support through the
Uniendo a Puerto Rico Fund and the Connect USVI Fund by evaluating
competitive proposals submitted by carriers. This approach could be
completed quickly and efficiently, thereby avoiding lengthy delays in
getting critical funding to carriers. A competitive proposal process is
a more streamlined approach than the typical Commission auction, yet
still requires carriers to compete for support. Moreover, this option
may better enable the Commission to determine how best to award support
for network-hardening purposes than the auction approach.
17. The Commission proposes that accepted proposals will receive
support for 10 years, beginning in January 2019 and running through
December 2028. The Commission seeks comment on whether to transition
support, through a phase-down process, in any geographic area where the
incumbent carrier, i.e., PRTC or Viya, did not win support based on its
proposal. The Commission provides additional details and seek comment
on them in the following.
18. Eligible Providers.--The Commission proposes that only a
provider that, according to June 2017 FCC Form 477 data, had an
existing fixed network and provided broadband service in Puerto Rico or
the U.S. Virgin Islands prior to the hurricanes would be eligible to
apply to participate. The Commission seeks comment on whether
participation should be limited to fixed providers who served at least
some residential locations or whether providers that served only
business locations should also be permitted to participate. The
Commission proposes to limit participation to providers who had
provided services before the hurricane because it believes they would
be better equipped to rebuild and expand service as quickly as
possible. Relatedly, the Commission also believes that existing
providers with established track records present a smaller risk of
defaulting on their service obligations. However, the Commission seeks
comment on whether new entrants should also be eligible. If so, what
particular qualifications if any should the Commission impose on them?
19. The Commission further proposes to evaluate the financial and
technical capabilities of the applicants through a single-stage
application process. Doing so would minimize the amount of time it
takes to complete the competitive proposal process and begin awarding
support. The Commission seeks comment on whether to use instead the
two-phase application process of the competitive bidding rules for
universal service in Part 1, Subpart AA of the Commission's rules, as
it has done for the CAF Phase II auction.
20. Consistent with the Communications Act of 1934, as amended, and
the Commission's rules, a provider must be designated as an ETC before
receiving support. To the extent necessary, the Commission proposes to
allow providers to obtain ETC designations after winning support rather
than before participating in the competitive proposal process, similar
to the approach it followed for the CAF Phase II auction. The
Commission seeks comment on this approach. What methods would be
appropriate for selecting another carrier if the winner fails to timely
obtain an ETC designation?
21. Eligible Areas.--Given the unique circumstances presented by
the widespread destruction of critical infrastructure, the Commission
proposes to make eligible all of Puerto Rico. By making the entire
territory eligible, the Commission would eliminate the need to
establish a challenge process and thus enable a more expeditious
completion of the process. Doing so would also encourage applicants to
expand service to areas that were previously unserved, in addition to
restoring service to areas that had service before the hurricanes.
Further, the Commission anticipates that making all of Puerto Rico
eligible for support will increase competition, driving down the
support amounts proposed in lower-cost areas. The Commission seeks
comment on this approach. Similarly, the Commission proposes to make
eligible all of the U.S. Virgin Islands and seek comment on that
approach.
22. Alternatively, the Commission seeks comment on whether certain
areas should be excluded. For example, are there areas where service
has already been rebuilt (or will be rebuilt by the end of 2018)? Are
there areas where providing high-cost support to one carrier would
distort the competitive market and reduce potential competitors'
incentives to rebuild service? How can the Commission ensure
consistency with its policy against providing funding in areas where
there is an unsubsidized competitor? Would the ability of other
carriers to bid for such support reduce the funding in such areas to
only what's needed to rebuild otherwise unserved areas? Are there areas
where support levels would be so low as to be unnecessary to rebuild
and improve service, such as census blocks in Puerto Rico identified by
the model as having particularly low average monthly costs? How can the
Commission best achieve its goal of maximizing the expansion of service
to unserved areas in addition to restoring and improving service to
areas that had it before the hurricanes?
23. Minimum Geographic Area.--The Commission proposes to accept
proposals for support to satisfy specific service obligations within
each of Puerto Rico's 78 municipios. Using municipios as the basic
geographic area for support may allow providers to achieve economies of
scale that would not be available if the Commission used smaller areas,
such as Puerto Rico's over 900 barrios. On the other hand, there may be
some risk that municipios are too large to target funding in a
competitively neutral manner--incumbent providers with large existing
service territories are likely more amenable to providing service over
a wider area. The Commission seeks comment on whether using municipios
makes sense or whether it should instead provide support on a more
granular basis, such as by barrios, census block groups, or some other
geographic unit.
24. The Commission seeks comment on the appropriate minimum
geographic area for support in the U.S. Virgin Islands. Should the
Commission treat
[[Page 27531]]
the entire territory as one geographic area to carry out this
initiative? Or should the Commission treat each island in the U.S.
Virgin Islands separately for this purpose? Or would using some other
census-defined geography such as census tract, census block group, or
census block be more appropriate?
25. Number of Locations in Each Geographic Area.--The Commission
proposes to identify the number of locations in each geographic area by
using the Connect America Cost Model (the CAM). The Commission seeks
comment on how it can best account for the fact that people may have
migrated from Puerto Rico and the U.S. Virgin Islands since the storms.
The Commission seeks comment on what other sources of data would more
accurately model the number of locations in each area. The Commission
also seeks comment on whether to provide support based on only certain
locations within each geographic area, such as those that are more
costly to serve, and whether to exclude certain other locations from
bidding, such as those that are less costly and therefore may not
require high-cost support. The Commission proposes, as a condition of
receiving support for funded locations, that a winning bidder serve all
locations within a geographic area, not just those funded (if the
Commission decides to fund just a subset of locations). This proposal
comports with the Commission's decision to focus on rebuilding all
networks and make all of Puerto Rico eligible for bidding, rather than
only discrete areas. Alternatively, the Commission seeks comment on
limiting the obligation only to funded locations or locations in census
blocks identified by the model as being above a certain funding
benchmark?
26. Given possible changes in the number of locations post-
hurricane and the difficulties in obtaining more recent, accurate data,
the Commission also seeks comment on whether to instead evaluate
proposals to serve all the locations in a municipio without determining
exactly how many locations that represents. In other words, applicants
would commit to serve all locations in a municipio rather than to serve
a specific number. The Commission also seeks comment on whether
differences in municipio characteristics, such as quantity of high cost
locations or remoteness, should lead the Commission's to attach
different obligations to funding so as to better ensure all parts of
the territories are provided with service.
27. Furthermore, if the data the Commission eventually adopts
overestimates the number of locations in an area, it seeks comment on
what flexibility to offer winning applicants. Should the Commission,
for example, reduce support on a pro rata basis if it lowers the number
of locations a provider must serve, and if so, what requirements and
limitations should the Commission establish for such reductions? Should
the Commission consider giving providers more flexibility here than it
has in other contexts given the facilities lost and the recent
emigration from the territories?
28. Reserve Prices.--The Commission proposes to use a three-step
process to set reserve prices. First, the Commission would employ the
cost model used to establish support for price cap carriers (the CAM)
to calculate the average cost per location of all locations in a census
block. Second, the Commission would set separate high-cost and
extremely high-cost thresholds for Puerto Rico and the U.S. Virgin
Islands to ensure the full amount of funding available to each
territory over the ten-year period is available for obligation. Third,
the Commission would establish a reserve price for each minimum
geographic area based on the sum of the support amounts calculated for
each eligible census block in that municipio. Under the proposal, WCB
would release the reserve price and number of locations for all
eligible areas by public notice no later than 30 calendar days before
the application deadline to submit competitive proposals.
29. The Commission seeks comment on this proposal, and particularly
on the key second step. The Commission notes that the extremely high-
cost threshold here would be used to establish a per-location funding
cap, similar to how the Commission offered rate-of-return carriers
model-based support. How should the Commission establish the
appropriate thresholds? The CAM established a high-cost threshold of
$52.50 based on assumed take rates and potential average revenues per
subscriber. Do those assumptions still hold in the context of Puerto
Rico and the U.S. Virgin Islands after the hurricanes? If not, should
the Commission lower the high-cost threshold and if so, by how much? By
25 percent? By more? The CAM established a high-cost threshold of
$198.60. Is that appropriate here? The Puerto Rico Telecommunications
Regulatory Board has stated that more support needs to be directed to
the rural parts of the island. Would that suggest setting a higher
extremely high-cost threshold? The Commission also seeks comment on how
to allocate funds between bringing service to locations that had never
been served versus restoring service (potentially at a lower cost) to
locations where service had been disrupted by the hurricanes. For
example, the Commission has previously assigned zero support to
locations below the high-cost threshold on the assumption that a
business case nonetheless existed to serve such locations. Does the
context of rebuilding networks on these islands suggest revisiting that
assumption and assigning some funding--say 10 percent of cost--to cover
the costs below the high-cost threshold? The Commission also seeks
comment on how the CAM should be adjusted, if at all, to take into
account the need for network hardening. For example, should the
Commission assume the cost of above-ground plant will increase 10
percent (or more) to account for such hardening before it determines
the costs per location?
30. Selection Process.--The Commission seeks comment on the
appropriate time frame and format for submitting proposals. The
Commission proposes to allow confidential proposals. Should the
Commission unseal proposals after finishing the evaluations process for
transparency reasons? The Commission seeks comment on whether to make
public the submitted proposals after the evaluation process has been
completed and winning applicants have been determined. The Commission
seeks comment on prohibiting multiple carriers from submitting a
proposal jointly.
31. The Commission proposes to select winning proposals based
primarily on price per-location served while adjusting the bids to
consider factors including network resiliency, network deployment
timing, and network performance. The Commission seeks comment on these
factors and what other factors it should consider when evaluating
proposals. Considering price as the primary factor responsibly manages
the Fund, but the Commission recognizes the increased costs of
deploying a storm-hardened network in Puerto Rico and the USVI. For
instance, how should the Commission factor storm hardening proposals
into the Commission's evaluation? Should the Commission require or
increase the weight of bids that comply with resiliency standards like
TIA-222-H, the most up-to-date standard for antenna supporting
structures, with best practices promulgated by the FCC's Communications
Security, Reliability and Interoperability Council, or with another
industry used standard for network resiliency? Should the Commission
establish weights to
[[Page 27532]]
account for the speed of deployment? What weight would be appropriate
to balance costs against encouraging prompt deployment to the
territories? Should the Commission establish weights to account for
proposals offering ``higher speeds over lower speeds, higher usage
allowances over lower usage allowances, and lower latency over higher
latency''? If so, what weighting scheme would be appropriate for that
purpose? Instead of using specific weights could the Commission define
preferences for various characteristics in the proposals? If the
Commission does not require proposals to identify a specific number of
locations to serve, what factors should it consider in comparing
proposals?
32. How should the Commission address package bidding? For example,
should the Commission allow package bidding? If so, what limits if any
should the Commission put on packages (e.g., should the Commission
require all packages to be contiguous or limit the number of minimum
geographic areas included in the package)? If selecting two package
bids would be the most efficient outcome even if they overlapped in a
particular geographic area, should the Commission accept both (perhaps
requiring the less efficient bidder to redirect support from the
overlapped area to other unserved areas) or reject the less efficient
package (perhaps leaving no bidder for some areas)?
33. How should the Commission evaluate bids? Should the Commission
direct USAC or WCB to evaluate bids? The Commission proposes directing
the reviewer to evaluate the bids in accordance with the selection
criteria, methodology and bidding process outlined above. Once that
initial evaluation is complete, should the Commission make selections
or offer feedback to applicants and allow them to return with best-and-
final offers? Or would that introduce undue discretion into the process
or create additional administrative burdens or delays? If a
dissatisfied applicant wants to challenge its non-selection, would
existing appeals processes be sufficient?
34. How should the Commission address areas without bids? One
approach would be to invite a second round of competitive proposals,
with the difference between bids and reserve prices in the first round
being transferred to raise the reserve price of remaining areas (pro
rata) in the second round. In other words, if the reserve price for
areas won in the first round were $10 million and only $8 million was
bid, then $2 million would be available to raise the reserve prices in
areas remaining in the second round. The Commission seeks comment on
this approach, including whether it would be vulnerable to potential
gamesmanship by bidders.
35. In addition, as a backstop, the Commission proposes to require
the incumbent carrier to continue to provide service to any unawarded
areas using frozen high-cost support--with corresponding service
obligations to be determined by the Commission after the competitive
proposal process is complete. The Commission notes that for this and
other purposes (such as any transitional payments) it would allocate an
incumbent carrier's existing frozen support across their service
territory in proportion to the reserve prices the Commission initially
set for the competitive proposal process. The Commission believes this
backstop would place incumbent carriers in no worse a position then
they are in today, with frozen support and accompanying service
obligations to be determined by the Commission.
36. Service Obligations.--In addition to voice service, the
Commission proposes to require support recipients to offer broadband
service meeting the following metrics: Download/upload speeds of at
least 10/1 megabits per second (Mbps), roundtrip latency of no greater
than 100 milliseconds (ms), and a minimum usage allowance of the higher
of 170 GB per month or one that reflects the average usage of a
majority of consumers, using Measuring Broadband America data or a
similar data source.
37. The Commission seeks comment on whether these obligations are
appropriate. Should the Commission, for instance, require some portion
of the areas served to receive 25/3 Mbps service? And, if so, what
fraction would be appropriate? Should the Commission impose different
requirements for areas based on the amount of support allocated?
38. Further, the Commission proposes requiring each support
recipient to offer broadband service in its supported area at rates
that are reasonably comparable to rates offered for comparable services
in urban areas. Rates will be considered reasonably comparable if they
are ``at or below the applicable benchmark to be announced annually by
public notice issued by the Wireline Competition Bureau.'' Based on the
results of the Urban Rate Survey, the Commission sees no reason to
adopt a different benchmark specific to Puerto Rico or the U.S. Virgin
Islands. The Commission seeks comment on this approach.
39. Deployment Milestones.--As with the CAF Phase II Auction, the
Commission proposes that winning bidders must deploy to at least 40
percent of locations after the third year of support, at least 60
percent after the fourth, at least 80 percent after the fifth, and 100
percent after the sixth year of support. The Commission seeks comment
on whether this schedule is appropriate. The Commission also seeks
comment on how it should track milestones if a particular number of
locations, as already discussed, is not defined. Are there other ways
to track progress without having to rely on location counts given the
possible difficulty of establishing a number of locations?
40. Oversight and Accountability Measures.--The Commission has an
obligation to ensure that carriers receive support ``only for the
provision, maintenance, and upgrading of facilities and service for
which the support is intended'' as required by section 254(e) of the
Act. The Commission has exercised its oversight obligations in a
variety of way since inception of the fund. In the following, the
Commission proposes various oversight and accountability measures that,
taken together, serve the public interest by enhancing the Commission's
ability to monitor the use of USF and ensure its use for intended
purposes.
41. First, the Commission proposes that support recipients must
satisfy all reporting and certification obligations of providers
receiving CAF Phase II auction support, including as described in
sections 54.313 and 54.316 of the Commission's rules. The Commission
seeks comment on this proposal. The Commission seeks comment on whether
providers who win support must track their restoration expenditures.
Should providers retain documentation on how much support was used for
capital expenditures and operating expenditures? What are the
associated burdens with retaining expenditure documentation? Would
retention of this documentation be duplicative of records needed for
deployment milestones?
42. Second, the Commission proposes aligning the annual reporting
obligations with the obligations of other rate-of-return carriers in
the 2016 Rate-of-Return Order, 81 FR 24282, April 25, 2016, by
requiring geocoded location reporting into the HUBB. This reporting
obligation would require providers to submit information demonstrating
locations the provider is reporting as broadband-enabled where the
company is prepared to offer voice and broadband service meeting the
requisite performance standards. Do carriers currently retain
geolocation data for served locations? If not, what period of
[[Page 27533]]
time is needed to enable collection of geolocation data? Should the
Commission require this data be reported for only newly deployed
locations or all reported locations? Would annual reporting or a longer
period more appropriately balance the reporting burden against the
accuracy of the data? Additionally, the Commission proposes requiring
awarded carriers to submit performance measurements in accordance with
the requirements to be defined by the Commission. To the extent that
awarded carriers have not participated in that proceeding, the
Commission proposes requiring the same testing method options and
parameters as price cap carriers.
43. Third, the Commission proposes to carefully monitor and
reassess the deployment obligations of the awarded support before the
end of the fifth year. Understanding the deployment and operational
realities of providing service in both Puerto Rico and the U.S. Virgin
Islands, the Commission believes this reassessment would be prudent to
address any changed circumstances within the territories, whether that
be changes in subscribership expectations due to population changes or
future disruptive natural disasters. As the current situation
demonstrates, the long-term planning involved in any telecommunications
deployment decision requires a number of assumptions that may change
dramatically over time. Would providing an opportunity for the
Commission to reassess deployment obligations be beneficial to
providers or cause unneeded uncertainty? Should the reassessment be
tied to deployment milestones? For example, the reassessment would not
be triggered if a provider is 60 percent deployed after four years, but
would occur if a provider failed to meet the deployment obligation.
Would it be appropriate to alter the obligations by increasing or
decreasing the number of locations or modifying the service
obligations?
44. Fourth, the Commission proposes to subject awarded carriers to
the same compliance standards as any other carrier with defined
obligations by defining specific obligations for the support. This may
result in a carrier that failed to meet its milestones having support
reduced until the carrier can meet its obligations or face recovery
actions. The Commission seeks comment on this approach.
45. The Commission also seeks comment on whether successful
applicants must obtain a letter of credit by way of security, as must
winning bidders in the CAF Phase II auction. If so, how should the
letter of credit be structured? Should it be for the full amount
awarded, or some lesser amount that will nevertheless protect the USF?
Should an alternative to a letter of credit be considered, such as a
performance or payment bond?
46. Fifth, the Commission proposes to subject all awarded carriers
in the territories to ongoing oversight by the Commission and USAC to
ensure program integrity and prevent waste, fraud, and abuse. The
Commission has a longstanding audit program that is continually updated
to respond to the Commission's needs inclusive of changes in program
requirements, new guidance from GAO and OMB, and changes in law.
Accordingly, the Commission proposes that all awarded carriers would be
subject to random compliance audits and other investigations to ensure
compliance with program rules and orders. The Commission seeks comment
on what sorts of audit procedures the Commission should undertake to
confirm that support has been spent on allowed restoration costs. The
Commission also seeks comment on whether there are specific
circumstances facing carriers in the territories that require modifying
the current audit practices.
47. As an alternative to the competitive proposal process, the
Commission seeks comment on using an auction for the second stages of
the Uniendo a Puerto Rico Fund and the Connect USVI Fund. The
Commission notes that it cannot simply apply the same rules of the CAF
Phase II Auction here because it seeks to achieve different goals.
Among other differences, here the Commission wishes to rebuild
networks, including in areas where a business case existed pre-
hurricane for providing service, whereas in the CAF Phase II context,
the Commission aims to maintain and expand service where there is no
such business case.
48. Instead, the Commission seeks comment on using a single-round
sealed bid auction to award support. Such an approach generally would
award support on a per-location basis, based on the lowest price.
Bidders would identify a per-location support price at which they are
willing to meet Commission requirements to cover the locations in each
eligible area they specify. Bids would then be ranked, lowest to
highest, and support would be assigned to those areas with the lowest
bid amounts submitted (and within each assigned area, to the lowest
bidder), until no further bids can be accommodated under the budget.
The terms of such an auction would otherwise largely track the terms
for the competitive proposal process described above.
49. The Commission seeks comment on whether the competitive
environment in Puerto Rico is sufficiently robust to ensure an auction
that distributes funds in a cost-effective way. The Commission seeks
comment on whether to use an auction process to distribute funds in
Puerto Rico, but not in the U.S. Virgin Islands, given that FCC Form
477 data shows that Viya is currently the only fixed provider there.
50. Are there any specific auction rules or procedures the
Commission should consider so that an auction would not be overly
complicated for the Commission to administer and would not overly
burden potential bidders? Is there an auction design the Commission
could use that would achieve its objective of maximizing consumer
benefits? Would this approach afford the same flexibility as a
competitive proposal process?
51. The Commission seeks comment on whether to structure the second
stages based on carrier-submitted proposals to rebuild, improve, and
expand service in the territories. Such proposals would not be
evaluated on a competitive basis, but would be the result of
negotiation between the Commission and carriers. Given similarly unique
circumstances, the Commission adopted a framework based on carrier
commitments to maintain and expand the availability of service in
Alaska.
52. Like the competitive proposal option, through this process the
Commission seeks to maximize the number of locations where fixed voice
and broadband services would be available in a targeted and cost-
effective manner. As with any method of awarding of support, the
Commission expects to hold providers accountable to use support for its
intended purposes and to meet the deployment commitments it set.
53. To the extent the Commission adopts this approach, it seeks
comment on the process by which it would seek proposals, review them,
and award support. The Commission anticipates establishing the specific
criteria by which it would award support and measure compliance by
Public Notice, along with a time frame for submitting proposals. The
Commission invites comment on this approach.
54. In the Universal Service Transformation Order, 76 FR 73830,
November 29, 2011, the Commission allowed price cap carriers serving
specific non-contiguous areas of the United States--including Puerto
Rico
[[Page 27534]]
and the U.S. Virgin Islands--to maintain frozen support levels for
those carriers if, in the Bureau's determination, certain conditions
were met. Recognizing that these carriers faced different operating
conditions and challenges compared to carriers in the contiguous 48
states, the Bureau invoked its discretion. Both PRTC and Viya elected
to continue receiving frozen support, with the Commission responsible
for adopting specific service obligations tailored to the individual
circumstances of each carrier.
55. As the Commission has not yet adopted CAF II obligations for
the frozen support that PRTC and Viya continue to receive, it seeks
comment on whether to forego reconsidering the Commission's prior
decisions and instead simply adopt specific service obligations to
reflect the frozen-support amounts PRTC and Viya currently receive. If
the Commission pursues this alternative, what obligations would be
appropriate and feasible? Should the Commission establish particular
expectations regarding expanding service to new areas or implementing
more resilient networks?
56. In the aftermath of the hurricanes, the rapid restoration of
mobile service was critical in facilitating communications with public
safety and civic officials and connecting families to loved ones.
Building upon the significant restoration efforts that have taken place
to date, the Commission seeks comment on how best to target high-cost
support to rebuild, improve, harden, and expand mobile services in
Puerto Rico and the U.S. Virgin Islands. The Commission proposes to
make $259 million in support available to eligible facilities-based
mobile providers over the next three years through the Uniendo a Puerto
Rico Fund and the Connect USVI Fund. The Commission's goal is to
facilitate timely recovery of mobile services within these territories
in a cost-effective manner.
57. The Commission notes that it has previously targeted Puerto
Rico and the U.S. Virgin Islands as potential areas eligible for the
upcoming MF-II auction. However, the Commission recognized in December
that conditions in the territories after the hurricanes made
establishing reliable coverage of mobile networks infeasible in the
near term. As such, the Commission waived the filing deadline for
mobile providers to submit 4G LTE coverage information for a period of
180 days or until the Commission took action addressing the appropriate
approach, given the circumstances, for providing ongoing, high-cost
support for mobile services in Puerto Rico and the U.S. Virgin Islands,
whichever occurred earlier.
58. The Commission now proposes to extend that waiver, exempt these
mobile providers from filing this coverage information, and carve
Puerto Rico and the U.S. Virgin Islands out from the MF-II auction.
Instead, the Commission proposes to supplement existing support over a
three-year period by giving providers an additional $21 million to
rebuild their networks after the destruction wrought by Hurricanes Irma
and Maria and their aftermath. The Commission seeks comment on
allocating these support amounts so that approximately 80 percent goes
to the Uniendo a Puerto Rico Fund and approximately 20 percent to the
Connect USVI Fund. As a result, over the next three years, the Uniendo
a Puerto Rico Fund would make available $254.4 million to mobile
network operators and the Connect USVI Fund would make available $4.4
million to mobile network operators. These territories currently face
serious and continuing challenges in restoring their mobile
communications capacity, and the Commission tentatively concludes that
this additional funding will allow providers in these territories to
repair the damage caused by the hurricanes to their wireless networks
as well as make their networks more resilient to future natural
disasters.
59. The Commission seeks comment on this proposal. In the
concurrently adopted Order, the Commission used the same 80-20 ratio to
balance the difference in population between Puerto Rico and the U.S.
Virgin Islands, the significant financial challenges faced by carriers
in both areas, the current level of high-cost support available to
providers, and other relevant factors. Should the Commission maintain
that ratio for the purpose of allocating additional support? Are the
total funding amounts appropriate for each territory given the
rebuilding required and the improvements need to harden networks
against future natural disasters and the expansion needed in rural
areas? Is a three-year term of support appropriate here? How should the
Commission address differences in historic universal service funding in
evaluating its long-term plans? For example, mobile carriers in the
U.S. Virgin Islands receive almost no funding today. Does that argue
for allocating most of the new funding there? Or should the Commission
redistribute all funding across both territories setting aside historic
allocations?
60. The Commission proposes that only providers that provided
facilities-based mobile services in Puerto Rico and the U.S. Virgin
Islands prior to the hurricane impacts, according to the June 2017 Form
477 data, would be eligible to elect this new funding. The Commission
proposes to allocate the new funding based on the number of subscribers
(voice or broadband internet access service) each provider served as of
June 30, 2017--similar to how the Commission calculates support in
stage one. As an alternative, the Commission seeks comment on
allocating all funding available for mobile network operators in the
second stages of the Uniendo a Puerto Rico Fund and the Connect USVI
Fund based on pre-hurricane subscribership. Such an approach would
avoid any inefficiencies in the historic allocation of support among
the islands and avoid the need for a decision ahead of time regarding
how much in particular should go to Puerto Rico versus the U.S. Virgin
Islands. If the Commission pursues this alternative approach, should
the Commission set transitional funding amounts for existing recipients
of high-cost support? In particular, should the Commission ensure that
existing recipients receive at least two-thirds of their current mobile
support in 2019 and at least one third in 2020?
61. The Commission proposes that, in exchange for accepting
additional support, each mobile provider must commit to, at minimum, a
full restoration of its pre-hurricane coverage area, at a level of
service that meets or exceeds the minimum standard required of
recipients of MF-II support. Such a requirement aligns with the goal of
MF-II to ``target universal service funding to support the deployment
of the highest level of mobile service available today--4G LTE.'' The
Commission tentatively concludes that, given the extent of damage in
Puerto Rico and the U.S. Virgin Islands, most providers will already be
engaging in substantial rebuilding of towers and infrastructure, and
will find it most economical to deploy 4G LTE during such restoration
versus alternative technologies. The Commission seeks comment on
whether this requirement is appropriate. Should the Commission instead
require providers to rebuild their networks at a different standard?
For example, should the Commission instead require deployment at the
speed benchmark used to identify areas eligible for MF-II? Is there an
alternative standard appropriate to ensure that residents of Puerto
Rico and the U.S. Virgin Islands have comparable service to other areas
of the United States? Should the Commission restrict funding to support
[[Page 27535]]
operation, deployment, and enhancement only of 4G LTE?
62. The Commission also seeks comment on whether the Uniendo a
Puerto Rico Fund and the Connect USVI Fund should include requirements
to expand service. Are there areas, for instance, that lacked coverage
before the hurricanes and that the Commission should nonetheless
require providers to serve? How should such areas be identified and how
should the Commission determine what carriers should be required to
serve them? The Commission seeks comment on how quickly rebuilding
could be accomplished and what milestones might be appropriate to
complete build out. Is three years of funding for rebuilding
appropriate? Why or why not?
63. The Commission also seeks comment on the appropriate reporting
requirements for support recipients. The Commission proposes to have
any mobile providers receiving second-stage support via the Uniendo a
Puerto Rico Fund and the Connect USVI Fund report twice per year on
their coverage. Specifically, the Commission proposes that providers
supply coverage maps using the buildout parameters the Commission will
adopt for the MF-II auction. If the Commission adopts a different
service requirement for funding recipients than the minimum standard
required of recipients of MF-II support, it proposes to make
appropriate adjustments to the reporting requirements. The Commission
seeks comment on these proposals. The Commission also seeks comment on
how this data should best be submitted to the Commission, such as
through the regular Form 477 filings or some other process?
64. As noted above, the Commission has an obligation to ensure that
carriers receive support ``only for the provision, maintenance, and
upgrading of facilities and service for which the support is intended''
as required by section 254(e) of the Act. The Commission seeks comment
on appropriate oversight and accountability measures for carriers that
receive additional high-cost support as proposed in this Notice. The
Commission proposes that recipients of such funds conform to the annual
reporting requirements the Commission adopted for MF-II. The Commission
also proposes that all support recipients be subject generally to the
same audit requirements as recipients of CAF-II support and all other
high-cost support. The Commission seeks comment on whether any other
oversight or accountability measures are appropriate. Should the
Commission require carriers to submit one or more Milestone Reports to
demonstrate progress on service restoration? Would it be beneficial for
the Commission or USAC to make use of independent testing to determine
service speed, quality, and reliability in these areas?
65. The Commission proposes to use an auction to allocate funding
following this three-year period, with any funding commitments
resulting from such an auction to commence on the day following the end
of the three-year period. The Commission seeks comment on whether the
competitive environment in Puerto Rico and the U.S. Virgin Islands is
sufficiently robust to ensure an auction that distributes funds in a
cost-effective way and whether it makes sense from the perspective of
administrative efficiency to hold such an auction. Can the Commission
use the same general auction rules and same auction design for this
auction as it will use for the MF-II auction? Are there any specific
auction rules or procedures the Commission should consider so that an
auction would not be overly complicated for the Commission to
administer and would not overly burden potential bidders?
66. If the Commission were to use an auction to allocate funding,
how should it determine which areas would be eligible to win support in
the auction? Should the Commission consider an area eligible if it does
not meet the speed and technical parameters used to identify areas
eligible for MF-II? Should the Commission adopt additional or
alternative specifications for eligibility that would be more suitable
for Puerto Rico and the U.S. Virgin Islands? For example, should an
area be eligible if, despite meeting a certain download speed
requirement, it does not meet certain network resiliency requirements,
e.g. hardening to hurricane impacts? If so, what resiliency
requirements would be appropriate? In this document, the Commission
proposes that providers supply coverage maps using the technical
parameters buildout parameters the Commission will adopt for the MF-II
auction. Would that coverage information suffice for determining areas
eligible for an auction, or is additional data required, such as a one-
time data collection using the MF-II Challenge process technical
parameters? If so, when should the Commission collect that data to
ensure that funding commitments can begin on schedule?
67. Several parties have proposed that rebuilt networks be ``storm
hardened.'' The Commission seeks comment on whether the Uniendo a
Puerto Rico Fund and the Connect USVI Fund should require second-stage
participants to improve the ability of their facilities and equipment
to resist hurricanes and other natural disasters. If so, should the
Commission require compliance with resiliency standards like TIA-222-H,
the most up-to-date standard for antenna supporting structures or with
best practices promulgated by the FCC's Communications Security,
Reliability and Interoperability Council? Are there other industry
standards that would help improve resistance to flooding, wind damage,
and water damage? How should any such requirements be enforced? What
are the expected costs of deploying a ``storm hardened'' network, and
how should the Commission evaluate the costs and benefits of any such
network? Should the Commission consider requiring hardening of certain
key network assets, but not the entire network? If so, how should key
assets be identified? Would requiring hardening only of assets
sufficient to provide voice and basic data service be appropriate? What
level of data service would be appropriate? Are costs associated with
back-up power endurance, backhaul resiliency, physical infrastructure
resiliency, recovery plans, and/or redundant or alternate network
implementations appropriate in this context? Should the Commission
instead allow carriers to include in their proposals how and to what
degree they would harden their networks, and factor that information
into the evaluation of proposals?
68. The Commission also proposes to require second-stage
participants to provide more detailed information to support tracking
of recovery efforts. Although mobile carriers already provide
information on coverage (but not signal strength, antenna alignment,
and throughput) on a biannual basis through FCC Form 477, that
information does not reveal the real-time status of communications
systems in the aftermath of a disaster. Carriers currently have the
option to provide information about the status of their infrastructure
via the Commission's voluntary Disaster Information Reporting System
(DIRS), and it proposes to require carriers who accept USF funding
through the Uniendo a Puerto Rico Fund and the Connect USVI Fund to
participate in DIRS. The Commission seeks comment on this proposal and
on the data that DIRS should seek. Would it be appropriate to require
mobile carriers to provide coverage maps, signal strength, antenna
alignment, and throughput on a periodic basis in DIRS? How often should
these reports be provided? Would it be
[[Page 27536]]
appropriate to require coverage maps at a more granular boundary value,
for example -98 dBm to reflect indoor coverage for both voice and data?
Would it be appropriate to require carriers to include information
about disruptions to backhaul? Should the DIRS data contain more
information about the customers' experience with their mobile service,
for example by including more information about the condition of
backhaul? If so, at what intervals? What are the costs and benefits of
requiring additional reporting? When might it be appropriate to relieve
carriers of any enhanced reporting requirements?
69. The Commission anticipates that any second-stage mobile
participants in the Uniendo a Puerto Rico Fund and the Connect USVI
Fund would continue to adhere to the current post-disaster resiliency
framework for some time and seek comment on when that framework should
and should not apply. First, are there common metrics used across
providers to determine whether and when to open roaming capabilities?
Should the Commission no longer expect adherence to the framework when
coverage has been rebuilt to pre-hurricane levels? If so, should there
be a minimum level of service associated with such coverage?
Alternatively, would a set time period for continued adherence, such as
one year, be more appropriate and reduce administrative burden? If so,
what time period would be appropriate? Finally, should a similar
framework be adopted for fixed providers?
70. The Commission also anticipates that any second-stage
participants in the Uniendo a Puerto Rico Fund and the Connect USVI
Fund would coordinate any construction and access issues with other
carriers and state and federal agencies to minimize duplicative
facilities, hardening, construction, digging, and other activity. The
Commission believes that such coordination could help rebuild service
in these areas more quickly and efficiently. The Commission seeks
comment on whether voluntary coordination is sufficient or if it should
adopt specific requirements. Commenters should identify specific
carrier obligations and a framework for coordination. If the Commission
adopted requirements, are there any reporting obligations that would be
appropriate to ensure cooperation?
71. Finally, the Commission understands that much of Puerto Rico
still lacks electrical power. Communications networks require reliable
power to operate. The Commission seeks comment on what obligations
providers should bear to ensure that their networks can function even
when the electrical power grid is down. For instance, the Commission
seeks comment on whether carriers could run their networks using energy
sources readily available in Puerto Rico and the U.S. Virgin Islands
that do not need to be shipped from elsewhere. The Commission seeks
comment on the applicable costs of sustainable back-up power. What are
the costs of maintaining generators on-site versus using portable
generators? What are the costs and additional considerations of
obtaining renewable back-up power versus traditional power methods?
72. Finally, the Commission seeks comment on other alternatives.
73. The Commission seeks comment on a petition filed by PRTC on
January 19, 2018, asking the Commission to ``create a $200 million
emergency Universal Service Fund designated to facilitate restoration
of service in insular areas by [ETCs] in Puerto Rico.'' PRTC's request
encompasses support for both fixed and mobile providers in Puerto Rico.
It suggests the Commission distribute funds ``based on a percentage of
the consumer service disruption credits provided by facilities-based
ETCs to end user customers'' or ``in proportion to the total number of
lines each facilities-based ETC restores during the next twelve
months.'' The Commission seeks specific comment on whether additional
short-term funding is necessary for Puerto Rico given the actions it
takes in the concurrently adopted Order. If the Commission were to
pursue such relief, how could it ensure that any funds are well spent?
Do carriers regularly offer ``service disruption credits,'' or do
different carriers offer different options to their consumers? And
would such an emergency fund create a perverse incentive of rewarding
those carriers that had greater service disruptions vis-[agrave]-vis
those that recovered more quickly from the hurricanes?
74. The Commission also seeks comment on the petition filed by Viya
proposing a one-time infusion of $45 million in support to help it
rebuild its fixed network in the U.S. Virgin Islands, the petition
filed by Viya on October 5, 2017, that sought ``a supplemental, one-
time infusion of up to $50 million for carriers to rebuild wireless
networks using hurricane-hardened facilities'' in the U.S. Virgin
Islands, and the petition filed by Open Mobile seeking additional high-
cost support and an advance on its support payments. The Commission
seeks specific comment on whether additional short-term funding is
necessary for the U.S. Virgin Islands given the actions it takes in the
concurrently adopted Order. If the Commission were to pursue such
relief, how could it ensure that any funds are well spent?
III. Procedural Matters
A. Initial Paperwork Reduction Act
75. This document contains proposed information collection
requirements. The Commission, as part of its continuing effort to
reduce paperwork burdens, invites the general public and the Office of
Management and Budget (OMB) to comment on the information collection
requirements contained in this document, as required by the Paperwork
Reduction Act of 1995, Public Law 104-13. In addition, pursuant to the
Small Business Paperwork Relief Act of 2002, Public Law 107-198, see 44
U.S.C. 3506(c)(4), the Commission seeks specific comment on how it
might further reduce the information collection burden for small
business concerns with fewer than 25 employees.
76. Initial Regulatory Flexibility Certification. The Regulatory
Flexibility Act of 1980 as amended (RFA) requires that a regulatory
flexibility analysis be prepared for rulemaking proceedings, unless the
agency certifies that ``the rule will not have a significant economic
impact on a substantial number of small entities.'' The RFA generally
defines ``small entity'' as having the same meaning as the terms
``small business,'' ``small organization,'' and ``small governmental
jurisdiction.'' In addition, the term ``small business'' has the same
meaning as the term ``small business concern'' under the Small Business
Act. A small business concern is one which: (1) Is independently owned
and operated; (2) is not dominant in its field of operation; and (3)
satisfies any additional criteria established by the Small Business
Administration (SBA).
77. This Notice proposes annual support to rebuild, improve, and
expand fixed and mobile services in Puerto Rico and the U.S. Virgin
Islands. The Notice proposes making support available to any fixed or
mobile provider who obtains an ETC designation, using a competitive and
subscriber-based process, respectively. Ten fixed and mobile carriers
in Puerto Rico and the U.S. Virgin Islands currently receive high-cost
support. Even assuming other carriers will obtain an ETC designation to
receive part of the additional support proposed by the Notice, the
Commission does not anticipate the proposed rule to affect more than 15
providers out of the 737 providers currently receiving high-cost
support. Accordingly, the Commission anticipates that this Notice
[[Page 27537]]
will not affect a substantial number of carriers, and so it does not
anticipate that it will affect a substantial number of small entities.
Therefore, the Commission certifies that this Notice will not have a
significant economic impact on a substantial number of small entities.
See 5 U.S.C. 605(b).
78. Comments. All comments to this Notice should be filed in WC
Docket No. 18-143, The Uniendo a Puerto Rico Fund and the Connect USVI
Fund.
IV. Ordering Clauses
79. Accordingly, it is ordered, pursuant to the authority contained
in sections 4(i), 214, 254, 303(r), and 403 of the Communications Act
of 1934, as amended, 47 U.S.C. 154(i), 214, 254, 303(r), and 403, and
sections 1.1, 1.3, and 1.412 of the Commission's rules, 47 CFR 1.1,
1.3, and 1.412, Notice of Proposed Rulemaking is adopted. The Notice is
effective thirty (30) days after publication of the text or summary
thereof in the Federal Register.
80. It is further ordered that pursuant to applicable procedures
set forth in sections 1.415 and 1.419 of the Commission's Rules, 47 CFR
1.415, 1.419, interested parties may file comments on the Notice on or
before July 5, 2018, and reply comments on or before July 18, 2018.
Federal Communications Commission.
Marlene Dortch,
Secretary.
[FR Doc. 2018-12625 Filed 6-12-18; 8:45 am]
BILLING CODE 6712-01-P