Companies may seek forbearance in unfunded census blocks
Among the changes that occurred when rate-of-return companies elected A-CAM II was that they no longer are required to provide Lifeline-supported broadband throughout their study areas if they file a “forbearance” notice within a specified timeframe. A-CAM II electors still must provide Lifeline-supported broadband to eligible customers located within census blocks where they receive A-CAM II support; however, they have the option to file for forbearance from the obligation in census blocks that are not funded by A-CAM II. This e-Lert outlines some considerations for A-CAM II clients weighing whether or not to take advantage of this “forbearance” opportunity.
Companies must file forbearance notices within 30 days of the receipt of their first A-CAM II support payments, which were made September 30, 2019. Therefore, the deadline for this Lifeline forbearance filing is October 30, 2019. If a company files for forbearance, it can still offer the Lifeline discount and receive reimbursement for broadband; however, there would be no obligation to offer the discount on that service.
While this forbearance option sounds positive at first glance, companies should carefully consider the pros and cons of this action before filing for forbearance with the FCC. The biggest negative that JSI has identified is that companies would have to keep track of Lifeline-supported broadband availability at the census-block level if they made the forbearance filing and did not want to offer Lifeline-supported broadband in the blocks where the company does not receive A-CAM II support. As well, customer service representatives (CSRs) would need to determine each potential Lifeline customer’s census block and be able to identify if it is an A-CAM II funded census block. Customers also may not understand why your company can offer Lifeline-supported broadband to some customers but not others, making this a potential customer relations problem. If companies decide not to file for forbearance, they would continue to be obligated to offer the Lifeline-supported broadband throughout their service areas and be eligible for reimbursement from the Lifeline fund.
If you would like to discuss this further with one of JSI’s Lifeline team members, please contact one of our experts by clicking the button below.