FEDERAL COMMUNICATIONS COMMISSION
August J 5,2012
,JULIUS GENACHOWSKI
CHAIRMAN
The Honorable Ed Whitfield
U.S. House of Representatives
2368 Rayburn House Office Building
Washington. D.C. 20515
Dear Congressman Whitfield:
Thank you for your letter regarding the effect of the Commission's Universal Service
Fund (USF) reforms. I want to assure you that the Commission will continue to work with all
stakeholders. including smaller rate-of-return carriers, throughout the reform process. Your
letter will be included in the record of the proceeding and considered by the Commission.
As you indicate. the Commission's unanimous overhaul of the Universal Service program
focused on three key goals: delivering broadband to the millions of unserved Americans.
requiring fiscal responsibility and accountability in USF spending to ensure the long-term
sustainability of the Fund. and providing transition periods that recognize business realities.
These reforms will put America on the path to universal broadband and advanced mobile
coverage - critical steps to create new jobs in rural America and across the nation. In palticular.
the creation of the Connect America Fund (CAF) will acceleratc broadband build-out to the 19
million Americans who currently have no access to robust broadband infrastructure. This will
create jobs and economic opportunity for small and large businesses in rural America, as well as
construction workers and salespeople. Increased broadband availability in rural areas will also
help schools and teachers and provide telemedicine opportunities for doctors and health care
providers.
The Commission's implementation of the USFI/CC Tram/orlllation Order continues to
be guided by these principles. including making adjusllnents to the Order as appropriate. For
instance, on April 25. 2012, the Commission extended the transition for originating interearrier
compensation payments, addressing a concern raised by a number of smaller carriers. Likewise,
in the Wireline Competition Bureau's Aprill3enchlllOrks Order, the Bureau revised the initially
proposed high-cost loop support benchmark categories to respond to concerns raised by smaller
carriers. The revised methodology takes recent investment into consideration; it accounts for
several additional drivers of cost in comparing spending betwecn carriers; it extends the
transition period to give carriers more time to adjust; and it provides a streamlined process to
address any concerns about the accuracy of carriers' data. The Commission has also extended a
number of reporting deadlines for smallcr carriers.
Even as we continue to make necessary adjustments. in order to extend broadband to
unserved rural communities while ensuring fiscal responsibility it is important to keep moving
445 12TH STREET 5.W WASHINGTON, D.C 20554 • 202-4 I 8'1000
Page 2-The Honorable Ed Whitfield
forward with implementation of the ommission's reforms. As we do so, the Commission will
continue to run a fair, opcn process in which the valid concerns of stakeholders are addressed­
working closely with affected carriers to ensure that residents of the nation's rural and high-cost
areas receive the quality voice and broadband service that all Americans need. I appreciate your
interest in this very important matter. Plea e let me know if I can be of any further assistance.
Sincerely,
,~-_..-- .
Julius Genachowski