JSI Asks FCC to Halt Rate Floor Increases

JSI and 33 of its High Cost Loop Support (HCLS) clients this week filed reply comments with the FCC requesting that the Commission declare the local urban rate survey to be incomplete and suspend indefinitely any increases to local rates that are tied to receiving HCLS.

These comments are in reaction to the Wireline Competition Bureau’s (WCB) recent local urban rate survey, which could result in many rural carriers dramatically raising their rates to meet a proposed $20.46 rate floor or face losing much needed Universal Service support. JSI and its clients feel the FCC needs time to revisit its policies and reevaluate the methodology to ensure there is a range of reasonableness around the urban average.

Our comments also point out potential problems with the WCB’s survey methodology, which may not be capturing comparable services in urban areas with a statistically valid sample. Its evaluation of comparable services must reflect the value customers place on local services, including the value of local calling scopes in rural areas relative to urban areas.

Some rural customers could face a 40% price hike if the FCC does not act. This could be devastating to communities because even the Commission itself recognizes that rural areas are home to a disproportionate number of low-income Americans.

These concerns support the indefinite suspension of any increase of the local urban rate floor, instead of the proposed postponement, while the FCC reexamines its policy of the urban rate floor.