2 11, 2021

CAF-BLS Cos. Without Locations in HUBB Must Contact USAC About Samples for Broadband Pre-Testing

2021-11-02T14:02:42-04:00November 2, 2021|e-Lerts|

Legacy CAF-BLS companies that may not have adequate locations in the HUBB for a random sampling before broadband performance pre-testing begins in January 2022 must contact USAC by Monday, November 8, 2021. All Legacy CAF-BLS companies, along with A-CAM II, Alaska Plan and CAF Phase II Auction carriers, must begin pre-testing in first quarter 2022 as part of the FCC’s performance measures testing framework. Companies will use a USAC-generated random sample of broadband locations deployed (and reported in the HUBB) that have active subscribers.

However, USAC has identified three scenarios where CAF-BLS companies may not have any locations or enough locations reported in the HUBB for the random sampling:

  1. Fully Deployed Prior to May 25, 2016 – Under this scenario, CAF-BLS companies have not reported any locations into the HUBB because they were fully deployed in their service territory prior to May 25, 2016 and therefore have no HUBB filing obligations.
  2. No Reported Deployments to Date – Since CAF-BLS companies only have one deployment milestone at the end of 2023, there may be some companies that do have a HUBB filing obligation but have not yet submitted any locations in HUBB due to no deployment of 25/3 broadband during the period May 25, 2016 to present.
  3. Limited Deployment to Date – Under this scenario, CAF-BLS carriers have entered some locations in the HUBB due to deployment of 25/3 broadband after May 25, 2016 but must rely on locations that were fully deployed prior to May 25, 2016 to meet their buildout obligations. For example, a company may have a buildout requirement of 3,000, but 2,800 of these were prior to May 25, 2016 and therefore only 200 locations are in the HUBB.

USAC has asked any Legacy CAF-BLS companies that fall under scenarios 1 and 2 to contact them at HCproduct@USAC.org by November 8. USAC is meeting with the FCC to discuss scenario 3 and is planning to send an updated email with language that is directly applicable to this situation. USAC is likely to ask companies under scenario 3 to tell them how many locations and at what speeds were deployed pre-2016 to be added to those that they did upload into HUBB. Regardless, USAC will follow up with CAF-BLS companies under each of the three scenarios on how to obtain random location samples for speed and latency pre-testing in 2022.

If you have any questions about this requirement or any other questions related to broadband performance testing, please contact Lans Chase at 770-569-2105 or Paul Nesenson at 651-452-2660.

26 10, 2020

JSI Encourages Early Preparedness for the 2021 Broadband Location Data Filing

2021-11-02T13:22:29-04:00October 26, 2020|e-Lerts|

Consider Reviewing Your Geocoded Data for Accuracy

As the end of construction season and the year fast approach, now is a good time to review your HUBB reporting status and determine the dataset you will file for the March 1, 2021 HUBB filing. A-CAM II and CAF-BLS companies should be aware of the additional HUBB reporting requirements for this filing only. In addition to the requirement to report broadband locations deployed in 2020, A-CAM II companies can report deployment of locations made prior to 2019. CAF-BLS companies can report any broadband locations deployed between May 25, 2016 and December 31, 2018. This is the only opportunity for companies receiving A-CAM II and CAF-BLS support to report locations deployed prior to 2019, and all filers must be aware that the HUBB will only accept geocoded location data with a date that falls in the reporting period for your funding category.

Although the HUBB reporting deadline is not until March 1, 2021, JSI recommends that you start the process of collecting and uploading your data now so that you can address any potential issues early. You can prepare by reviewing USAC’s guide on HUBB data formatting instructions, as well as error codes to use for revising your previously-filed HUBB data if it is determined that revisions are needed.

Companies that have been filing the HUBB for several years may want to consider undertaking a thorough review of mapping their previously-filed locations to check for accuracy, especially as the first milestone certification for A-CAM I will be due with the 2020 data on March 1, 2021. Mapping and geocoding techniques have gotten better each year, which enables more accurate reporting going forward and the ability to correct data that has already been filed.

To request assistance with evaluating existing HUBB data for geocode accuracy, or any questions about mapping HUBB locations, contact Paul Nesenson in our Minnesota office at 651-691-4045. If you need assistance or have questions regarding HUBB reporting requirements, please contact Lans Chase at 770-569-2105.

2 05, 2019

A-CAM II Offers Released with June 17 Decision Deadline (Delayed)

2019-06-06T15:48:17-04:00May 2, 2019|e-Lerts|

New 5-Year Buildout Obligations Announced for Carriers Remaining on Legacy  

Today, the FCC released the official Alternative Connect America Cost Model (A-CAM) II offer (v2.5.1) to rate-of-return carriers that are not already receiving model-based high-cost support. Carriers have until June 17, 2019 July 17, 2019, to indicate, on a state-by-state basis, if they choose to elect the model support. The A-CAM II 10-year term began January 1, 2019, despite the delay in releasing the offer. The FCC also released the new buildout obligations for companies that want to remain on Legacy high-cost support.

see our e-Lert: FCC Delays A-CAM II Election Deadline

A-CAM II Offers
Like the previous versions and the A-CAM I offer, v2.5.1 includes four reports. The first report (15.1) shows a list of state-level support for each eligible carrier, including the amount of annual support for 10 years and the total number of funded locations in each eligible census block. As a reminder, companies with multiple study areas are required to elect on a statewide basis. The second report (15.2) shows the specific broadband deployment obligations for each carrier, including “fully funded” and “capped” locations, the number of locations where 25/3 Mbps and 4/1 Mbps will be required, and the number of very high-cost locations subject to the reasonable request standard. The third report (15.3) shows the A-CAM II support amount, total eligible locations, fully funded, and capped locations by Tribal and non-Tribal component. Finally, the fourth report (15.4) lists the eligible census blocks.

The election letters must be submitted by June 17 July 17 to ConnectAmerica@fcc.gov. The letter must be signed by an officer of the company and confirm that the carrier elects support for the state(s) in which it serves, and the carrier must commit to satisfying the service obligations. JSI has a template letter for use in accepting the offer. Please contact us if you would like the template letter or if you’d like it customized for your company.

A-CAM II support will not be disbursed until after the FCC releases a Public Notice authorizing USAC to move forward with the disbursements. Carriers who elect A-CAM II must also exit the NECA common line pool before they can receive model-based support, and they are eligible to move their business data services (BDS) offerings to incentive regulation next year.

New 5-Year Plan
The FCC also released revised deployment obligations for rate-of-return carriers that are not currently receiving A-CAM I support, or the new “five-year plan” which companies can compare to the A-CAM II offer. This data shows how many 23/5 locations must be built out over the period of five years from 2019 to 2024. Companies that choose to stay on CAF-BLS can have their deployment obligations determined either by a calculation with the weighted average cost per loop or with the A-CAM II cost per location. It is our understanding that in the near future, USAC will be reaching out to obtain each company’s choice as the agency did for the previous five-year plan.

Assistance for Companies Considering A-CAM II
To assist clients in making the decision whether to remain Legacy or elect A-CAM II, JSI can provide detailed analysis which compares the support that a company would receive under A-CAM II with projected support under CAF-BLS for 10 years. Clients for which we have already performed this analysis should discuss with their JSI consultants any changes to their A-CAM II support offer that may have been revised in today’s offer, as it was based on Form 477 data that was also just released today. Additionally, JSI can produce maps showing the funded census blocks and location data and we can assist companies remaining on Legacy support with HUBB reporting related to the revised buildout requirements.

JSI will be covering A-CAM II in our Management Seminars which begin next week. We also plan to host a webinar prior to the election deadline to review implementation considerations, such as tariff-related matters, HUBB reporting, and ways to ensure your company can meet the buildout requirements.

Please contact your cost consultant, Steve Meltzer, Brian Sullivan, or John Kuykendall in JSI’s Maryland office at 301-459-7590 if you would like JSI to perform an in-depth A-CAM II analysis, would like our mapping service, or if you have any questions regarding the A-CAM II offer.

11 07, 2018

FCC Establishes Rules to Measure Broadband Performance

2018-07-11T14:23:03-04:00July 11, 2018|e-Lerts|

Requires Testing to Begin Third Quarter 2019

Late Friday, the FCC released an Order announcing new rules for carriers to measure broadband speed and latency performance, with the main requirements summarized in the Order’s Appendix A. At this time, the rules apply to all Eligible Telecommunications Carriers (ETCs) that have mandatory buildout obligations and report location data in USAC’s HUBB portal. This includes A-CAM and legacy carriers with less than 80% 10/1, as well as Rural Broadband Experiment and Connect America Fund (CAF) Phase II support recipients. However, given that the Order envisions that all high-cost USF recipients “that served fixed locations” must conduct the tests, it is possible that legacy carriers with greater than 80% 10/1 that report location information on the Form 481 will eventually be required to comply.

The number of subscribers to be tested will be based on the number of subscribers at locations that are supported by the CAF (for example, A-CAM supported census blocks or entire study areas for CAF-BLS recipients with buildout obligations), with a maximum of 50 randomly selected subscribers per state per speed tier for speed testing and 50 randomly selected subscribers per state for latency. The subscribers eligible for testing must be at locations that are reported in the HUBB where there is an active subscriber. Testing must be conducted for one week during each quarter of the year. In those weeks, testing must be performed between the hours of 6:00 p.m. to 12:00 a.m. local time each day, including weekends (testing hours).

Carriers may choose between three testing options. The first option is a program that some of the larger carriers have participated in called Measuring Broadband America (MBA). Under this option, carriers may enter into arrangements with entities that manage and perform testing for the MBA. A second option is for carriers to use their own existing network management systems and tools, “ping” tests, and other commonly available measurement and network management tools (known as “off-the-shelf” testing). The third option would be for the carrier to implement a provider-developed self-testing configuration.

The first tests begin in the third quarter of 2019. The certification for these tests will be due by July 1, 2020, and will cover data for third and fourth quarters of 2019. Subsequent tests will be conducted for the full calendar year and submitted/certified by the following July 1. The data will be subject to audit by USAC. Further guidance regarding submission of the data will be provided by the Wireline Bureau in a future Public Notice.

JSI will be providing additional information regarding these new rules in the coming weeks. If you have any questions, contact John Kuykendall, Cassandra Heyne or Terri Parrilla in JSI’s Maryland office at 301-459-7590.

7 03, 2018

All RLECs Subject to ARC Imputation for CBOL

2018-03-07T15:57:51-05:00March 7, 2018|e-Lerts|

In recent months, JSI has had inquiries from clients that are considering offering standalone broadband, now known as Consumer Broadband-Only Loops or “CBOL.” Among the considerations that we have discussed with clients is how this offering will impact revenues received from the Access Recovery Charge (ARC) that will not be offset by additional CAF-ICC support. As explained below, offering CBOL requires both A-CAM electors and those receiving Legacy support to “impute” the ARC on all CBOL lines. Because ARCs cannot be charged to customers with CBOL lines, clients should consider other options to make up lost revenues.

The ARC, which is charged to customers’ voice lines, plays an integral role in calculating CAF-ICC support for each RLEC. This is because revenues from the ARC are applied prior to determining the amount of CAF-ICC support. When the FCC introduced CBOL in the 2016 USF Reform Order, the Commission expressed its concern that when customers transition to CBOL and drop their voice lines, there would be less ARC revenues resulting in an increased amount of CAF-ICC support. To address this concern, the FCC ruled that the ARC must be imputed on all CBOL lines. The imputation of the ARC for CBOL means that in calculating CAF-ICC, USAC will treat CBOL lines as though ARCs are being charged, even though this is not occurring.

Although it first appeared that the imputation would only apply to recipients of CAF-BLS support, in December 2016 the FCC clarified that the imputation applies to all RLECs, including A-CAM recipients. Also, in a recent Order, the FCC limited the imputation for CBOL lines that were in effect when the 2016 Reform Order was released. According to this ruling, which is effective July 1, 2018, the FCC will only reduce an RLEC’s CAF-ICC support if its maximum accessible ARCs and imputed ARCs fall short of a “baseline” amount. This baseline amount is determined by using the RLEC’s ARC revenues from tariff year 2015-16. As part of the annual tariff filing process, NECA and JSI will be providing additional guidance regarding the implementation of this new ruling in the coming weeks.

While the FCC’s imputation requirements help to ensure that the CAF-ICC is not adversely impacted, it unfortunately impacts clients due to the loss of ARC revenues without any corresponding increase in CAF-ICC support. FCC rules allow ARCs to be charged only on voice lines so clients should consider other options to make up lost ARC revenues when implementing CBOL lines. These options include eliminating the ARC by meeting the rate ceiling and imposing cost recovery fees on broadband subscribers.

JSI will be explaining these and other options at its 2018 Management Seminars and our staff are available any time to provide guidance on these matters. For assistance, please contact Steve Meltzer, Brian Sullivan or John Kuykendall in JSI’s Maryland office at 301-459-7590.

23 02, 2018

Clearing Up HUBB Requirement Confusion for Some CAF-BLS Clients

2018-02-23T10:12:52-05:00February 23, 2018|e-Lerts|

CAF-BLS (Legacy) support recipients with 80% or greater deployment of 10/1 Mbps, based on their 2015 Form 477 filings, have no defined buildout requirements and therefore do not have to report deployment data through the Universal Service Administrative Company’s (USAC’s) High Cost Universal Broadband (HUBB) portal. Only A-CAM recipients and those CAF-BLS companies with less than 80% broadband deployment must report locations using HUBB by March 1 (see our January 5th e-lert for more details).

But over the past couple of days several CAF-BLS clients that have no buildout requirements have reported that USAC representatives informed them that they must meet the March 1 HUBB filing deadline. JSI reached out to the USAC representatives and made them aware of USAC’s HUBB Frequently Asked Questions, which makes it clear that CAF-BLS companies with 80% or greater deployment of 10/1 are not obligated to make any filing in the HUBB. The USAC representatives agreed and are now in the process of updating its contact list to remove companies with no HUBB filing requirements.

JSI takes this opportunity to reassure CAF-BLS clients with 80% or greater deployment of 10/1 that they have no requirements to file anything in HUBB.  Instead, these companies will report progress on the number of locations where 10/1 Mbps or better broadband service has been deployed during the prior calendar year on the Form 481 due July 1. The exact specifications of this requirement are not yet available, but in conversations with the FCC, JSI learned that geocoded locations will not be required.

If you have any questions regarding this issue, please contact Cassandra Heyne in the Maryland office at 301-459-7590 or Lans Chase in the Georgia office at 770-569-2105.

26 09, 2017

JSI Urges FCC to Adopt Least Burdensome Reporting Requirements

2017-12-14T10:59:36-05:00September 26, 2017|e-Lerts|

On Wednesday, September 20, JSI met with members of the FCC’s Wireline Competition Bureau to discuss the broadband location reporting requirements for CAF-BLS recipients with 80 percent or greater broadband deployment that have no buildout obligations. These carriers must report on their Form 481 progress on the number of locations where 10/1 Mbps or better broadband service has been deployed within their study area during the prior calendar year. Although it is expected that the FCC will require this data to be reported on the Form 481 due July 1, 2018, the FCC has yet to provide any guidance as to what data would need to be reported or the format.

In the meeting, JSI urged the FCC to adopt the least burdensome reporting requirements, proposing that the FCC merely require a place on the Form 481 where companies on legacy support with no buildout requirements would indicate the number of locations where 10/1 Mbps or better broadband has been deployed during the reporting period. In our discussions, FCC staff indicated that they were considering such an approach and may also require data for additional speed tiers. JSI also urged that under no circumstances should carriers be required to provide geocoded data on the Form 481 and that the reporting not be required until the Form 481 due July 1, 2019.

JSI also clarified that A-CAM recipients will only be required to report pre-existing locations in eligible, funded census blocks. As a reminder, by March 1, 2018, A-CAM recipients must report geocoded location information for all newly deployed locations during the calendar year 2017 timeframe in USAC’s HUBB portal, but have until March 1, 2019, to report pre-existing locations. CAF-BLS recipients with buildout requirements must report geocoded location information for newly deployed locations during the May 25, 2016, to December 31, 2017, timeframe in the HUBB by March 1, 2018.

JSI expects that the FCC will release official guidance on these topics in the near future, and in the meantime we will continue working with clients on their broadband location data collection to prepare for next year’s HUBB or Form 481 filings. If you have any questions about the reporting requirements or JSI’s meeting with FCC staff, please contact Cassandra Heyne in the Maryland office at 301-459-7590 or Lans Chase in JSI’s Georgia office at 770-569-2105.

6 03, 2017

FCC Announces 2017 Rate Benchmarks for Voice and Broadband

2017-12-14T10:42:26-05:00March 6, 2017|e-Lerts|

In February, the FCC’s Wireline Competition Bureau released a Public Notice announcing the 2017 local rate floor for incumbent eligible telecommunications carriers (ETCs) that receive High Cost Loop Support (HCLS). Companies that elected A-CAM support or that remain on legacy support and do not receive HCLS are not subject to meeting the local rate floor benchmark. Based on the most recent urban rate survey, the 2017 rate floor for voice services is $22.49, up from $21.93 in 2016.

Because the rate floor is being phased in (see the schedule below), companies will only face a reduction of high cost support on a dollar-for-dollar basis to the extent that a carrier’s local rates plus state fees are below $20.00 on June 1, 2017. The current phase-in schedule for the rate floor is:

July 1, 2017 – June 30, 2018 (rates must be in effect by June 1, 2017) – support reductions for residential rates below $20

July 1, 2018 – Beyond (rates must be in effect by June 1, 2018) – annual support reductions for lines with rates below the national urban average local rate as determined by the FCC’s annual survey

JSI reminds clients that they should follow relevant state requirements for notifying customers of any rate increases associated with the FCC’s universal service and intercarrier compensation (USF/ICC) reforms, including making any necessary updates to your company’s tariff. Generally, you will need to notify your customers of the impending rate increase at least 30 days in advance. If your state does not have notification requirements, JSI still recommends that your company provide notice since proactively notifying your customers of rate changes is always a good business practice. A full suite of solutions to assist companies communicate these rate increases to customers—including bill messages, website text and scripts for customer service representatives—is available from JSI.

Voice and Broadband Rate Benchmarks
In the same Public Notice announcing the rate floor, the FCC announced that all ETCs, including competitive ETCs providing fixed voice services, must certify on their FCC Form 481s that the price of their basic residential voice service does not exceed $49.51. Recipients of high cost and/or Connect America Fund support that are subject to broadband performance obligations also are required to certify on their Form 481 that they do not exceed a broadband rate benchmark. These providers must offer at least one residential broadband service at rates that are at or below the relevant reasonable comparability benchmark. Affected carriers, which include both legacy/CAF-BLS and A-CAM supported companies, must certify compliance with this obligation on their annual Form 481 filing due July 1, 2018, covering services provided by them or by their affiliated broadband providers during calendar year 2017.

The most recent broadband urban rate survey resulted in a slight increase to broadband rate benchmarks for unlimited usage allowance plans, and slightly higher increases for plans with usage allowances. To assess whether your broadband offerings comply with the new broadband rate benchmarks, JSI recommends utilizing the FCC’s Reasonable Comparability Benchmark Calculator.

In addition to establishing reasonable rate benchmarks for broadband, the Commission also determined reasonably comparable usage allowances for broadband providers that use data “caps” based on the 2016 Measuring Broadband America data. ETCs subject to broadband public interest obligations that do not offer unlimited data offerings must provide broadband with usage allowances at or above the minimum usage allowance established by the FCC. For 2017, the FCC established a minimum monthly usage allowance of 160 GBs for both price cap carriers receiving Phase II model-based support and rate-of-return carriers (A-CAM and legacy/CAF-BLS). This represents an increase from the 150 GM minimum usage allowance standard in place for calendar year 2016.

If you have any questions regarding the rate floor or broadband rate benchmarks, or would like assistance in communicating rate increases with your customers, please contact John Kuykendall at 301-459-7590.

Source: JSI e-Lert

27 02, 2017

FCC Extends HUBB, Form 477 Broadband Reporting Deadlines

2017-12-14T11:00:27-05:00February 27, 2017|e-Lerts|

Late Friday, February 24, the FCC extended two deadlines for broadband reporting obligations that were supposed to occur this week. First, an FCC Order extends the March 1, 2017, deadline for rate-of-return carriers to submit geo-located broadband data in USAC’s High Cost Universal Service Broadband (HUBB) portal. Second, a separate Public Notice extends the March 1, 2017, deadline for carriers to file FCC Form 477 data for the period ending December 31, 2016, due to technical difficulties associated with the FCC Form 477 filing interface. The FCC has not yet set a due date for Form 477 data and indicated that it would announce the new due date once the technical difficulties are resolved. JSI will issue another e-Lert once the new Form 477 deadline is announced.

HUBB Reporting Deadline Extended
In its Order, the FCC extended this year’s March 1 deadline for both rate-of-return carriers remaining under legacy support that have defined buildout obligations and those that have elected Alternative Connect America Cost Model (A-CAM). The FCC also clarified what constitutes “pre-existing” locations for A-CAM electors as being those locations deployed prior to January 1, 2017, and extended the broadband reporting deadline for recipients of Connect America Fund (CAF) Phase II support. Under the extension, carriers have the following deadlines to report geolocation information into the HUBB portal, which has not yet been opened because it has not yet been approved by the Office of Management and Budget (OMB).

  • CAF-BLS (Legacy) support recipients with defined deployment obligation (i.e., carriers with less than 80% broadband deployment in their study areas) have until March 1, 2018, to report all broadband locations newly deployed between May 25, 2016, and December 31, 2017;
  • A-CAM support recipients have until March 1, 2018, to report all broadband locations newly deployed during calendar year 2017;
  • A-CAM support recipients have until March 1, 2019, to report all preexisting broadband locations (those served prior to January 1, 2017); and
  • CAF Phase II support recipients have until July 1, 2017, to report all broadband locations newly deployed during calendar year 2016.

All of the above deadlines assume OMB approves the FCC’s broadband data collection program. If OMB does not grant its approval prior to the above deadlines, broadband reporting obligations are extended until two weeks after OMB approval is published in the Federal Register.

As was already made clear before the Order, carriers remaining under legacy support with 80% or greater 10/1 deployment are required to report location information to USAC as part of the FCC Form 481 reporting and not in the HUBB. JSI is coordinating with NTCA regarding the association’s efforts in filings with the FCC to ensure that no buildout information will be required on this year’s Form 481 and will provide additional information as it is released by the FCC or USAC concerning future reporting requirements and due dates.

JSI encourages clients to continue developing strategies to accurately capture and report newly deployed broadband locations. As we have learned through the process of preparing broadband geo-location information for upload into USAC’s HUBB, this can be a difficult task and the extension allows companies additional time to identify and accurately capture broadband deployment data. Additionally, a number of clients have identified potential problems with previously-filed FCC Form 477s. JSI encourages clients that discover errors on their Form 477 filings to file revisions if the error amounts to a difference of 5% or more of the data reported. Further, to the extent that the HUBB is approved by OMB prior to the above-mentioned deadlines, JSI continues to encourage clients to upload broadband deployment data on a routine basis such that clients do not have to report all locations before the applicable deadline.

JSI remains committed to assisting interested clients with compliance activities associated with broadband reporting obligations. Our broadband reporting team will be available to answer any questions and assist in preparing and uploading newly deployed broadband locations to ensure clients remain in compliance with their reporting obligations. For assistance with HUBB reporting, please contact Cassandra Heyne in JSI’s Maryland office at 301-459-7590. For assistance with FCC Form 477 reporting, please contact Marty Kluh in JSI’s Maryland office at 301-459-7590.

Source: JSI e-Lert

5 12, 2016

Options Available to Rate-of-Return Carriers Introducing CBOL

2016-12-05T09:43:09-05:00December 5, 2016|e-Lerts|

NECA Response Due By December 6

Beginning in January, the FCC will begin distributing universal service support for qualifying data-only lines or what is now known as “Consumer Broadband-Only Loops” or CBOL. The support will initially go to all rate-of-return carriers that have reported on Form 508 that they currently have data-only broadband lines or are projected to have such lines in 2017. This support is part of the Connect America Fund Broadband Loop Support (CAF-BLS), a new Universal Service support mechanism which replaces Interstate Common Line Support (ICLS). After the A-CAM has been implemented, carriers that receive A-CAM support will no longer receive CAF-BLS and thus will no longer receive support for CBOL under that mechanism.

In order to calculate support for CBOL, a carrier’s loop cost associated with providing broadband-only service (the CBOL revenue requirement) is reduced by the CBOL calculated rate. To determine the CBOL calculated rate, a base amount of $42 per loop per month is assumed, or “imputed.” (This amount could be lower if the total CBOL revenue requirement is less than the $42 per CBOL per month). In addition to this amount, FCC rules require that if, due to the application of the budgetary constraint mechanism, an increase in a carrier’s initial CBOL rate is required to meet a carrier’s CBOL revenue requirement, the shortfall must be added to the $42 per loop per month amount. NECA has determined the shortfall amount and provided the total “imputed rate” ($42 plus the attributed budget shortfall amount) for each carrier that will be receiving CBOL support.

Companies that offer CBOL have the option of offering the service as either tariffed or “permissively detariffed” (i.e., post rates, terms and conditions on their website). Over the past week, JSI has held discussions with FCC Wireline Bureau staff and NECA regarding these and other options available to those that will be offering CBOL. From these discussions, we have learned that the rate that would be charged, whether it is to your affiliated ISP or another customer, may be “delinked” from the imputed rates used to calculate CBOL support and that a rate lower than the imputed rate can be charged. Charging a lower rate is advantageous because the Federal Universal Service Charge (FUSC) is imposed on the CBOL rates charged to the customer, whether tariffed or detariffed, not on the imputed rate. It should be noted that charging a lower rate would not affect any CAF-BLS you would be eligible to receive for your CBOL service due to the imputation of the differential for settlement purposes.

Listed below are some of the options available to companies that will be offering CBOL. Please note that if you have selected NECA to tariff your CBOL rate, you have until tomorrow, Tuesday, December 6, to inform NECA if you would like to tariff a rate lower than the imputed rate. Also, if you have previously informed NECA that you do not want the agency to tariff your CBOL rate and now would like for them to do so, you have until tomorrow to so indicate.

  1. CBOL rate can be shown at the full amount ($42 plus the attributed budget shortfall amount). In that case, the FUSC would be assessed on the full CBOL rate.
  2. CBOL rate can be shown at less than the full amount. In such cases, the FUSC would be assessed on the lesser amounts. Some options to consider are:
    1. Rate can be shown as $42 (the additive would be imputed and not charged to the affiliate).
    2. Rate can be shown as a reasonable approximation of cost basis such as your R-1 rate.
    3. Rate can be as low as a $1.00. JSI cautions that charging too low a rate runs the risk of attracting an ISP competitor who is able to purchase the wholesale CBOL service at the tariffed or permissively detariffed rate.

If you would like to discuss these options or have any questions about the CBOL support mechanism, contact your cost consultant or Steve Meltzer, Brian Sullivan, or John Kuykendall in the Maryland office at 301-459-7590.

Source: JSI e-Lert

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