OFFICE OF
THE CHAIRMAN
FEDERAL COMMUNICATIONS COMMISSION
WASHINGTON
June 16, 2017
The Honorable Heidi Heitkamp
United States Senate
110 Hart Senate Office Building
Washington, D.C. 20510
Dear Senator Heitkamp:
Thank you for your letter regarding the importance of delivering to all Americans-
including those in high-cost rural areas-affordable access to high-speed Internet access. As you
know, I grew up in Parsons, Kansas and have traveled during my time at the Commission to
locations as varied as Barrow, Alaska, and Diller, Nebraska, and Carthage, Mississippi. I have
seen with my own eyes what access to affordable high-speed Internet access can do for a
community-for its schools, its libraries, and its hospitals, and for those Americans struggling to
stay afloat.
Four years ago, I called on the Conmiission to tackle the issue of affordable broadband in
rural America head on. The problem back then was that the Universal Service Fund predicated
support on providing voice service. This meant bundled telephone/broadband offers could get
support while standalone broadband could not. The perverse result was that carriers were
incented to take universal service support and offer telephone/broadband bundles (even if
consumers could not afford them) while not offering standalone broadband. The business case
for stand-alone broadband didn't exist for some rural telephone companies-not because
consumers didn't want it, but because our arcane rules penalized companies for offering it.
I wish I could tell you that the FCC has fixed this problem. But as your letter rightly
points out, we have not. Despite the Commission's efforts in the 2016 Rate-of-Return Reform
Order, I still hear from small carriers that offering stand-alone broadband would put them
underwater-that the rates they have to charge exceed the rates for bundled services because of
the different regulatory treatment. This is unfortunate but unsurprising. As I said at the time, the
Order needlessly complicated our rate-of-return system and in many ways made it harder, not
easier, for small providers to serve rural America.
To provide some relief, my colleagues in recent months have urged me to work through a
punch list of lingering issues from the Order. I have accordingly directed staff to work through
that list. In April, the Commission amended a rule that would have disallowed capital expenses
to any project exceeding a Commission-set threshold by even a dollar; now providers can
complete efficient projects so long as they are willing to absorb any costs above the threshold.
That month staff also resolved concerns raised by rural carriers about the "parent-trap" rule. In
May, I circulated an order to address problems with two calculations made in the Order-one
involving a "surrogate method" to avoid duplicative cost-recovery and another involving charges
imposed on stand-alone broadband lines. Also in May, I circulated an order to address certain
duplicative reporting requirements imposed on rural providers. I look forward to continue
working with my colleagues on these issues.
Page 2-The Honorable Heidi Heitkamp
Although I hope these changes will help, you may be right that something more
fundamental is needed. After all, if the Order is not carrying out its stated purpose of advancing
broadband deployment in rural America, we cannot ignore that problem-for time is not on the
side of rural Americans.
I appreciate your views on this matter. They will be included in the record of this
proceeding and considered as part of the Commission's review. Please let me know if I can be
of any further assistance.
Sincerely,
Ajit V. Pai
OFFICE OF
THE CHAIRMAN
FEDERAL COMMUNICATIONS COMMISSION
WASHINGTON
June 16, 2017
The Honorable John Hoeven
United States Senate
338 Russell Senate Office Building
Washington, D.C. 20510
Dear Senator Hoeven:
Thank you for your letter regarding the importance of delivering to all Americans-
including those in high-cost rural areas-affordable access to high-speed Internet access. As you
know, I grew up in Parsons, Kansas and have traveled during my time at the Commission to
locations as varied as Barrow, Alaska, and Diller, Nebraska, and Carthage, Mississippi. I have
seen with my own eyes what access to affordable high-speed Internet access can do for a
community-for its schools, its libraries, and its hospitals, and for those Americans struggling to
stay afloat.
Four years ago, I called on the Conmiission to tackle the issue of affordable broadband in
rural America head on. The problem back then was that the Universal Service Fund predicated
support on providing voice service. This meant bundled telephone/broadband offers could get
support while standalone broadband could not. The perverse result was that carriers were
incented to take universal service support and offer telephone/broadband bundles (even if
consumers could not afford them) while not offering standalone broadband. The business case
for stand-alone broadband didn't exist for some rural telephone companies-not because
consumers didn't want it, but because our arcane rules penalized companies for offering it.
I wish I could tell you that the FCC has fixed this problem. But as your letter rightly
points out, we have not. Despite the Commission's efforts in the 2016 Rate-of-Return Reform
Order, I still hear from small carriers that offering stand-alone broadband would put them
underwater-that the rates they have to charge exceed the rates for bundled services because of
the different regulatory treatment. This is unfortunate but unsurprising. As I said at the time, the
Order needlessly complicated our rate-of-return system and in many ways made it harder, not
easier, for small providers to serve rural America.
To provide some relief, my colleagues in recent months have urged me to work through a
punch list of lingering issues from the Order. I have accordingly directed staff to work through
that list. In April, the Commission amended a rule that would have disallowed capital expenses
to any project exceeding a Commission-set threshold by even a dollar; now providers can
complete efficient projects so long as they are willing to absorb any costs above the threshold.
That month staff also resolved concerns raised by rural carriers about the "parent-trap" rule. In
May, I circulated an order to address problems with two calculations made in the Order-one
involving a "surrogate method" to avoid duplicative cost-recovery and another involving charges
imposed on stand-alone broadband lines. Also in May, I circulated an order to address certain
duplicative reporting requirements imposed on rural providers. I look forward to continue
working with my colleagues on these issues.
Page 2-The Honorable John Hoeven
Although I hope these changes will help, you may be right that something more
fundamental is needed. After all, if the Order is not carrying out its stated purpose of advancing
broadband deployment in rural America, we cannot ignore that problem-for time is not on the
side of rural Americans.
I appreciate your views on this matter. They will be included in the record of this
proceeding and considered as part of the Commission's review. Please let me know if I can be
of any further assistance.
Sincerely,
Ajit V. Fai
OFFICE OF
THE CHAIRMAN
FEDERAL COMMUNICATIONS COMMISSION
WASHINGTON
June 16, 2017
The Honorable James M. Inhofe
United States Senate
205 Russell Senate Office Building
Washington, D.C. 20510
Dear Senator Inhofe:
Thank you for your letter regarding the importance of delivering to all Americans-
including those in high-cost rural areas-affordable access to high-speed Internet access. As you
know, I grew up in Parsons, Kansas and have traveled during my time at the Commission to
locations as varied as Barrow, Alaska, and Diller, Nebraska, and Carthage, Mississippi. I have
seen with my own eyes what access to affordable high-speed Internet access can do for a
community-for its schools, its libraries, and its hospitals, and for those Americans struggling to
stay afloat.
Four years ago, I called on the Commission to tackle the issue of affordable broadband in
rural America head on. The problem back then was that the Universal Service Fund predicated
support on providing voice service. This meant bundled telephone/broadband offers could get
support while standalone broadband could not. The perverse result was that carriers were
incented to take universal service support and offer telephone/broadband bundles (even if
consumers could not afford them) while not offering standalone broadband. The business case
for stand-alone broadband didn't exist for some rural telephone companies-not because
consumers didn't want it, but because our arcane rules penalized companies for offering it.
I wish I could tell you that the FCC has fixed this problem. But as your letter rightly
points out, we have not. Despite the Commission's efforts in the 2016 Rate-of-Return Reform
Order, I still hear from small carriers that offering stand-alone broadband would put them
underwater-that the rates they have to charge exceed the rates for bundled services because of
the different regulatory treatment. This is unfortunate but unsurprising. As I said at the time, the
Order needlessly complicated our rate-of-return system and in many ways made it harder, not
easier, for small providers to serve rural America.
To provide some relief, my colleagues in recent months have urged me to work through a
punch list of lingering issues from the Order. I have accordingly directed staff to work through
that list. In April, the Commission amended a rule that would have disallowed capital expenses
to any project exceeding a Commission-set threshold by even a dollar; now providers can
complete efficient projects so long as they are willing to absorb any costs above the threshold.
That month staff also resolved concerns raised by rural carriers about the "parent-trap" rule. In
May, I circulated an order to address problems with two calculations made in the Order-one
involving a "surrogate method" to avoid duplicative cost-recovery and another involving charges
imposed on stand-alone broadband lines. Also in May, I circulated an order to address certain
duplicative reporting requirements imposed on rural providers. I look forward to continue
working with my colleagues on these issues.
Page 2-The Honorable James M. Inhofe
Although I hope these changes will help, you may be right that something more
fundamental is needed. After all, if the Order is not carrying out its stated purpose of advancing
broadband deployment in rural America, we cannot ignore that problem-for time is not on the
side of rural Americans.
I appreciate your views on this matter. They will be included in the record of this
proceeding and considered as part of the Commission's review. Please let me know if I can be
of any further assistance.
o
	
Sincerely,
,-: v
Ajit V. Pai
OFFICE OF
THE CHAIRMAN
FEDERAL COMMUNICATIONS COMMISSION
WASHINGTON
June 16, 2017
The Honorable Johnny Isakson
United States Senate
131 Russell Senate Office Building
Washington, D.C. 20510
Dear Senator Isakson:
Thank you for your letter regarding the importance of delivering to all Americans-
including those in high-cost rural areas-affordable access to high-speed Internet access. As you
know, I grew up in Parsons, Kansas and have traveled during my time at the Commission to
locations as varied as Barrow, Alaska, and Diller, Nebraska, and Carthage, Mississippi. I have
seen with my own eyes what access to affordable high-speed Internet access can do for a
community-for its schools, its libraries, and its hospitals, and for those Americans struggling to
stay afloat.
Four years ago, I called on the Commission to tackle the issue of affordable broadband in
rural America head on. The problem back then was that the Universal Service Fund predicated
support on providing voice service. This meant bundled telephone/broadband offers could get
support while standalone broadband could not. The perverse result was that carriers were
incented to take universal service support and offer telephone/broadband bundles (even if
consumers could not afford them) while not offering standalone broadband. The business case
for stand-alone broadband didn't exist for some rural telephone companies-not because
consumers didn't want it, but because our arcane rules penalized companies for offering it.
I wish I could tell you that the FCC has fixed this problem. But as your letter rightly
points out, we have not. Despite the Commission's efforts in the 2016 Rate-of-Return Reform
Order, I still hear from small carriers that offering stand-alone broadband would put them
underwater-that the rates they have to charge exceed the rates for bundled services because of
the different regulatory treatment. This is unfortunate but unsurprising. As I said at the time, the
Order needlessly complicated our rate-of-return system and in many ways made it harder, not
easier, for small providers to serve rural America.
To provide some relief, my colleagues in recent months have urged me to work through a
punch list of lingering issues from the Order. I have accordingly directed staff to work through
that list. In April, the Commission amended a rule that would have disallowed capital expenses
to any project exceeding a Commission-set threshold by even a dollar; now providers can
complete efficient projects so long as they are willing to absorb any costs above the threshold.
That month staff also resolved concerns raised by rural carriers about the "parent-trap" rule. In
May, I circulated an order to address problems with two calculations made in the Order-one
involving a "surrogate method" to avoid duplicative cost-recovery and another involving charges
imposed on stand-alone broadband lines. Also in May, I circulated an order to address certain
duplicative reporting requirements imposed on rural providers. I look forward to continue
working with my colleagues on these issues.
Page 2-The Honorable Johnny Jsakson
Although I hope these changes will help, you may be right that something more
fundamental is needed. After all, if the Order is not carrying out its stated purpose of advancing
broadband deployment in rural America, we cannot ignore that problem-for time is not on the
side of rural Americans.
I appreciate your views on this matter. They will be included in the record of this
proceeding and considered as part of the Commission's review. Please let me know if I can be
of any further assistance.
Sincerely,
Ajit V. Pai
FEDERAL COMMUNICATIONS COMMISSION
WASHINGTON
OFFICE OF
THE CHAIRMAN June 16, 2017
The Honorable Tim Kaine
United States Senate
231 Russell Senate Office Building
Washington, D.C. 20510
Dear Senator Kaine:
Thank you for your letter regarding the importance of delivering to all Americans-
including those in high-cost rural areas-affordable access to high-speed Internet access. As you
know, I grew up in Parsons, Kansas and have traveled during my time at the Commission to
locations as varied as Barrow, Alaska, and Diller, Nebraska, and Carthage, Mississippi. I have
seen with my own eyes what access to affordable high-speed Internet access can do for a
community-for its schools, its libraries, and its hospitals, and for those Americans struggling to
stay afloat.
Four years ago, I called on the Commission to tackle the issue of affordable broadband in
rural America head on. The problem back then was that the Universal Service Fund predicated
support on providing voice service. This meant bundled telephone/broadband offers could get
support while standalone broadband could not. The perverse result was that carriers were
incented to take universal service support and offer telephone/broadband bundles (even if
consumers could not afford them) while not offering standalone broadband. The business case
for stand-alone broadband didn't exist for some rural telephone companies-not because
consumers didn't want it, but because our arcane rules penalized companies for offering it.
I wish I could tell you that the FCC has fixed this problem. But as your letter rightly
points out, we have not. Despite the Commission's efforts in the 2016 Rate-of-Return Reform
Order, I still hear from small carriers that offering stand-alone broadband would put them
underwater-that the rates they have to charge exceed the rates for bundled services because of
the different regulatory treatment. This is unfortunate but unsurprising. As I said at the time, the
Order needlessly complicated our rate-of-return system and in many ways made it harder, not
easier, for small providers to serve rural America.
To provide some relief, my colleagues in recent months have urged me to work through a
punch list of lingering issues from the Order. I have accordingly directed staff to work through
that list. In April, the Commission amended a rule that would have disallowed capital expenses
to any project exceeding a Commission-set threshold by even a dollar; now providers can
complete efficient projects so long as they are willing to absorb any costs above the threshold.
That month staff also resolved concerns raised by rural carriers about the "parent-trap" rule. In
May, I circulated an order to address problems with two calculations made in the Order-one
involving a "surrogate method" to avoid duplicative cost-recovery and another involving charges
imposed on stand-alone broadband lines. Also in May, I circulated an order to address certain
duplicative reporting requirements imposed on rural providers. I look forward to continue
working with my colleagues on these issues.
Page 2-The Honorable Tim Kaine
Although I hope these changes will help, you may be right that something more
fundamental is needed. After all, if the Order is not carrying out its stated purpose of advancing
broadband deployment in rural America, we cannot ignore that problem-for time is not on the
side of rural Americans.
I appreciate your views on this matter. They will be included in the record of this
proceeding and considered as part of the Commission's review. Please let me know if I can be
of any further assistance.
Sincerely,
AjitV.Pai
J\1
OFFICE OF
THE CHAIRMAN
FEDERAL COMMUNICATIONS COMMISSION
WASHINGTON
June 16, 2017
The Honorable Angus King
United States Senate
133 Hart Senate Office Building
Washington, D.C. 20510
Dear Senator King:
Thank you for your letter regarding the importance of delivering to all Americans-
including those in high-cost rural areas-affordable access to high-speed Internet access. As you
know, I grew up in Parsons, Kansas and have traveled during my time at the Commission to
locations as varied as Barrow, Alaska, and Diller, Nebraska, and Carthage, Mississippi. I have
seen with my own eyes what access to affordable high-speed Internet access can do for a
community-for its schools, its libraries, and its hospitals, and for those Americans struggling to
stay afloat.
Four years ago, I called on the Commission to tackle the issue of affordable broadband in
rural America head on. The problem back then was that the Universal Service Fund predicated
support on providing voice service. This meant bundled telephone/broadband offers could get
support while standalone broadband could not. The perverse result was that carriers were
incented to take universal service support and offer telephone/broadband bundles (even if
consumers could not afford them) while not offering standalone broadband. The business case
for stand-alone broadband didn't exist for some rural telephone companies-not because
consumers didn't want it, but because our arcane rules penalized companies for offering it.
I wish I could tell you that the FCC has fixed this problem. But as your letter rightly
points out, we have not. Despite the Commission's efforts in the 2016 Rate-of-Return Reform
Order, I still hear from small carriers that offering stand-alone broadband would put them
underwater-that the rates they have to charge exceed the rates for bundled services because of
the different regulatory treatment. This is unfortunate but unsurprising. As I said at the time, the
Order needlessly complicated our rate-of-return system and in many ways made it harder, not
easier, for small providers to serve rural America.
To provide some relief, my colleagues in recent months have urged me to work through a
punch list of lingering issues from the Order. I have accordingly directed staff to work through
that list. In April, the Commission amended a rule that would have disallowed capital expenses
to any project exceeding a Commission-set threshold by even a dollar; now providers can
complete efficient projects so long as they are willing to absorb any costs above the threshold.
That month staff also resolved concerns raised by rural carriers about the "parent-trap" rule. In
May, I circulated an order to address problems with two calculations made in the Order-one
involving a "surrogate method" to avoid duplicative cost-recovery and another involving charges
imposed on stand-alone broadband lines. Also in May, I circulated an order to address certain
duplicative reporting requirements imposed on rural providers. I look forward to continue
working with my colleagues on these issues.
Page 2-The Honorable Angus King
Although I hope these changes will help, you may be right that something more
fundamental is needed. After all, if the Order is not carrying out its stated purpose of advancing
broadband deployment in rural America, we cannot ignore that problem-for time is not on the
side of rural Americans.
I appreciate your views on this matter. They will be included in the record of this
proceeding and considered as part of the Commission's review. Please let me know if I can be
of any further assistance.
OFFICE OF
THE CHAIRMAN
FEDERAL COMMUNICATIONS COMMISSION
WASHINGTON
June 16, 2017
The Honorable Amy Kiobuchar
United States Senate
302 Hart Senate Office Building
Washington, D.C. 20510
Dear Senator Kiobuchar:
Thank you for your letter regarding the importance of delivering to all Americans-
including those in high-cost rural areas-affordable access to high-speed Internet access. As you
know, I grew up in Parsons, Kansas and have traveled during my time at the Commission to
locations as varied as Barrow, Alaska, and Diller, Nebraska, and Carthage, Mississippi. I have
seen with my own eyes what access to affordable high-speed Internet access can do for a
community-for its schools, its libraries, and its hospitals, and for those Americans struggling to
stay afloat.
Four years ago, I called on the Commission to tackle the issue of affordable broadband in
rural America head on. The problem back then was that the Universal Service Fund predicated
support on providing voice service. This meant bundled telephone/broadband offers could get
support while standalone broadband could not. The perverse result was that carriers were
incented to take universal service support and offer telephone/broadband bundles (even if
consumers could not afford them) while not offering standalone broadband. The business case
for stand-alone broadband didn't exist for some rural telephone companies-not because
consumers didn't want it, but because our arcane rules penalized companies for offering it.
I wish I could tell you that the FCC has fixed this problem. But as your letter rightly
points out, we have not. Despite the Commission's efforts in the 2016 Rate-of-Return Reform
Order, I still hear from small carriers that offering stand-alone broadband would put them
underwater-that the rates they have to charge exceed the rates for bundled services because of
the different regulatory treatment. This is unfortunate but unsurprising. As I said at the time, the
Order needlessly complicated our rate-of-return system and in many ways made it harder, not
easier, for small providers to serve rural America.
To provide some relief, my colleagues in recent months have urged me to work through a
punch list of lingering issues from the Order. I have accordingly directed staff to work through
that list. In April, the Commission amended a rule that would have disallowed capital expenses
to any project exceeding a Commission-set threshold by even a dollar; now providers can
complete efficient projects so long as they are willing to absorb any costs above the threshold.
That month staff also resolved concerns raised by rural carriers about the "parent-trap" rule. In
May, I circulated an order to address problems with two calculations made in the Order-one
involving a "surrogate method" to avoid duplicative cost-recovery and another involving charges
imposed on stand-alone broadband lines. Also in May, I circulated an order to address certain
duplicative reporting requirements imposed on rural providers. I look forward to continue
working with my colleagues on these issues.
Page 2-The Honorable Amy Kiobuchar
Although I hope these changes will help, you may be right that something more
fundamental is needed. After all, if the Order is not carrying out its stated purpose of advancing
broadband deployment in rural America, we cannot ignore that problem-for time is not on the
side of rural Americans.
I appreciate your views on this matter. They will be included in the record of this
proceeding and considered as part of the Commission's review. Please let me know if I can be
of any further assistance.
Sincerely,
Ajit V. Pai
OFFICE OF
THE CHAIRMAN
FEDERAL COMMUNICATIONS COMMISSION
WASHINGTON
June 16, 2017
The Honorable James Lankford
United States Senate
316 Hart Senate Office Building
Washington, D.C. 20510
Dear Senator Lankford:
Thank you for your letter regarding the importance of delivering to all Americans-
including those in high-cost rural areas-affordable access to high-speed Internet access. As you
know, I grew up in Parsons, Kansas and have traveled during my time at the Commission to
locations as varied as Barrow, Alaska, and Diller, Nebraska, and Carthage, Mississippi. I have
seen with my own eyes what access to affordable high-speed Internet access can do for a
community-for its schools, its libraries, and its hospitals, and for those Americans struggling to
stay afloat.
Four years ago, I called on the Commission to tackle the issue of affordable broadband in
rural America head on. The problem back then was that the Universal Service Fund predicated
support on providing voice service. This meant bundled telephone/broadband offers could get
support while standalone broadband could not. The perverse result was that carriers were
incented to take universal service support and offer telephone/broadband bundles (even if
consumers could not afford them) while not offering standalone broadband. The business case
for stand-alone broadband didn't exist for some rural telephone companies-not because
consumers didn't want it, but because our arcane rules penalized companies for offering it.
I wish I could tell you that the FCC has fixed this problem. But as your letter rightly
points out, we have not. Despite the Commission's efforts in the 2016 Rate-of-Return Reform
Order, I still hear from small carriers that offering stand-alone broadband would put them
underwater-that the rates they have to charge exceed the rates for bundled services because of
the different regulatory treatment. This is unfortunate but unsurprising. As I said at the time, the
Order needlessly complicated our rate-of-return system and in many ways made it harder, not
easier, for small providers to serve rural America.
To provide some relief, my colleagues in recent months have urged me to work through a
punch list of lingering issues from the Order. I have accordingly directed staff to work through
that list. In April, the Commission amended a rule that would have disallowed capital expenses
to any project exceeding a Commission-set threshold by even a dollar; now providers can
complete efficient projects so long as they are willing to absorb any costs above the threshold.
That month staff also resolved concerns raised by rural carriers about the "parent-trap" rule. In
May, I circulated an order to address problems with two calculations made in the Order-one
involving a "surrogate method" to avoid duplicative cost-recovery and another involving charges
imposed on stand-alone broadband lines. Also in May, I circulated an order to address certain
duplicative reporting requirements imposed on rural providers. I look forward to continue
working with my colleagues on these issues.
Page 2-The Honorable James Lankford
Although I hope these changes will help, you may be right that something more
fundamental is needed. After all, if the Order is not carrying out its stated purpose of advancing
broadband deployment in rural America, we cannot ignore that problem-for time is not on the
side of rural Americans.
I appreciate your views on this matter. They will be included in the record of this
proceeding and considered as part of the Commission's review. Please let me know if I can be
of any further assistance.
Sincerely,
Ajit V. Pai
OFFICE OF
THE CHAIRMAN
FEDERAL COMMUNICATIONS COMMISSION
WASHINGTON
June 16, 2017
The Honorable Patrick J. Leahy
United States Senate
437 Russell Senate Office Building
Washington, D.C. 20510
Dear Senator Leahy:
Thank you for your letter regarding the importance of delivering to all Americans-
including those in high-cost rural areas-affordable access to high-speed Internet access. As you
know, I grew up in Parsons, Kansas and have traveled during my time at the Commission to
locations as varied as Barrow, Alaska, and Diller, Nebraska, and Carthage, Mississippi. I have
seen with my own eyes what access to affordable high-speed Internet access can do for a
community-for its schools, its libraries, and its hospitals, and for those Americans struggling to
stay afloat.
Four years ago, I called on the Commission to tackle the issue of affordable broadband in
rural America head on. The problem back then was that the Universal Service Fund predicated
support on providing voice service. This meant bundled telephone/broadband offers could get
support while standalone broadband could not. The perverse result was that carriers were
incented to take universal service support and offer telephone/broadband bundles (even if
consumers could not afford them) while not offering standalone broadband. The business case
for stand-alone broadband didn't exist for some rural telephone companies-not because
consumers didn't want it, but because our arcane rules penalized companies for offering it.
I wish I could tell you that the FCC has fixed this problem. But as your letter rightly
points out, we have not. Despite the Commission's efforts in the 2016 Rate-of-Return Reform
Order, I still hear from small carriers that offering stand-alone broadband would put them
underwater-that the rates they have to charge exceed the rates for bundled services because of
the different regulatory treatment. This is unfortunate but unsurprising. As I said at the time, the
Order needlessly complicated our rate-of-return system and in many ways made it harder, not
easier, for small providers to serve rural America.
To provide some relief, my colleagues in recent months have urged me to work through a
punch list of lingering issues from the Order. I have accordingly directed staff to work through
that list. In April, the Commission amended a rule that would have disallowed capital expenses
to any project exceeding a Commission-set threshold by even a dollar; now providers can
complete efficient projects so long as they are willing to absorb any costs above the threshold.
That month staff also resolved concerns raised by rural carriers about the "parent-trap" rule. In
May, I circulated an order to address problems with two calculations made in the Order-one
involving a "surrogate method" to avoid duplicative cost-recovery and another involving charges
imposed on stand-alone broadband lines. Also in May, I circulated an order to address certain
duplicative reporting requirements imposed on rural providers. I look forward to continue
working with my colleagues on these issues.
Page 2-The Honorable Patrick J. Leahy
Although I hope these changes will help, you may be right that something more
fundamental is needed. After all, if the Order is not carrying out its stated purpose of advancing
broadband deployment in rural America, we cannot ignore that problem-for time is not on the
side of rural Americans.
I appreciate your views on this matter. They will be included in the record of this
proceeding and considered as part of the Commission's review. Please let me know if I can be
of any further assistance.
Sincerely,
VAjitV.Pai
//i
FEDERAL COMMUNICATIONS COMMISSION
WASHINGTON
OFFICE OF
THE CHAIRMAN June 16, 2017
The Honorable Joe Manchin
United States Senate
306 Hart Senate Office Building
Washington, D.C. 20510
Dear Senator Manchin:
Thank you for your letter regarding the importance of delivering to all Americans-
including those in high-cost rural areas-affordable access to high-speed Internet access. As you
know, I grew up in Parsons, Kansas and have traveled during my time at the Commission to
locations as varied as Barrow, Alaska, and Diller, Nebraska, and Carthage, Mississippi. I have
seen with my own eyes what access to affordable high-speed Internet access can do for a
community-for its schools, its libraries, and its hospitals, and for those Americans struggling to
stay afloat.
Four years ago, I called on the Commission to tackle the issue of affordable broadband in
rural America head on. The problem back then was that the Universal Service Fund predicated
support on providing voice service. This meant bundled telephone/broadband offers could get
support while standalone broadband could not. The perverse result was that carriers were
incented to take universal service support and offer telephone/broadband bundles (even if
consumers could not afford them) while not offering standalone broadband. The business case
for stand-alone broadband didn't exist for some rural telephone companies-not because
consumers didn't want it, but because our arcane rules penalized companies for offering it.
I wish I could tell you that the FCC has fixed this problem. But as your letter rightly
points out, we have not. Despite the Commission's efforts in the 2016 Rate-of-Return Reform
Order, I still hear from small carriers that offering stand-alone broadband would put them
underwater-that the rates they have to charge exceed the rates for bundled services because of
the different regulatory treatment. This is unfortunate but unsurprising. As I said at the time, the
Order needlessly complicated our rate-of-return system and in many ways made it harder, not
easier, for small providers to serve rural America.
To provide some relief, my colleagues in recent months have urged me to work through a
punch list of lingering issues from the Order. I have accordingly directed staff to work through
that list. In April, the Commission amended a rule that would have disallowed capital expenses
to any project exceeding a Commission-set threshold by even a dollar; now providers can
complete efficient projects so long as they are willing to absorb any costs above the threshold.
That month staff also resolved concerns raised by rural carriers about the "parent-trap" rule. In
May, I circulated an order to address problems with two calculations made in the Order-one
involving a "surrogate method" to avoid duplicative cost-recovery and another involving charges
imposed on stand-alone broadband lines. Also in May, I circulated an order to address certain
duplicative reporting requirements imposed on rural providers. I look forward to continue
working with my colleagues on these issues.
Page 2-The Honorable Joe Manchin
Although I hope these changes will help, you may be right that something more
fundamental is needed. After all, if the Order is not carrying out its stated purpose of advancing
broadband deployment in rural America, we cannot ignore that problem-for time is not on the
side of rural Americans.
I appreciate your views on this matter. They will be included in the record of this
proceeding and considered as part of the Commission's review. Please let me know if I can be
of any further assistance.
OFFICE OF
THE CHAIRMAN
FEDERAL COMMUNICATIONS COMMISSION
WASHINGTON
June 16, 2017
The Honorable John McCain
United States Senate
218 Russell Senate Office Building
Washington, D.C. 20510
Dear Senator McCain:
Thank you for your letter regarding the importance of delivering to all Americans-
including those in high-cost rural areas-affordable access to high-speed Internet access. As you
know, I grew up in Parsons, Kansas and have traveled during my time at the Commission to
locations as varied as Barrow, Alaska, and Diller, Nebraska, and Carthage, Mississippi. I have
seen with my own eyes what access to affordable high-speed Internet access can do for a
community-for its schools, its libraries, and its hospitals, and for those Americans struggling to
stay afloat.
Four years ago, I called on the Commission to tackle the issue of affordable broadband in
rural America head on. The problem back then was that the Universal Service Fund predicated
support on providing voice service. This meant bundled telephone/broadband offers could get
support while standalone broadband could not. The perverse result was that carriers were
incented to take universal service support and offer telephone/broadband bundles (even if
consumers could not afford them) while not offering standalone broadband. The business case
for stand-alone broadband didn't exist for some rural telephone companies-not because
consumers didn't want it, but because our arcane rules penalized companies for offering it.
I wish I could tell you that the FCC has fixed this problem. But as your letter rightly
points out, we have not. Despite the Commission's efforts in the 2016 Rate-of-Return Reform
Order, I still hear from small carriers that offering stand-alone broadband would put them
underwater-that the rates they have to charge exceed the rates for bundled services because of
the different regulatory treatment. This is unfortunate but unsurprising. As I said at the time, the
Order needlessly complicated our rate-of-return system and in many ways made it harder, not
easier, for small providers to serve rural America.
To provide some relief, my colleagues in recent months have urged me to work through a
punch list of lingering issues from the Order. I have accordingly directed staff to work through
that list. In April, the Commission amended a rule that would have disallowed capital expenses
to any project exceeding a Commission-set threshold by even a dollar; now providers can
complete efficient projects so long as they are willing to absorb any costs above the threshold.
That month staff also resolved concerns raised by rural carriers about the "parent-trap" rule. In
May, I circulated an order to address problems with two calculations made in the Order-one
involving a "surrogate method" to avoid duplicative cost-recovery and another involving charges
imposed on stand-alone broadband lines. Also in May, I circulated an order to address certain
duplicative reporting requirements imposed on rural providers. I look forward to continue
working with my colleagues on these issues.
Page 2-The Honorable John McCain
Although I hope these changes will help, you may be right that something more
fundamental is needed. After all, if the Order is not carrying out its stated purpose of advancing
broadband deployment in rural America, we cannot ignore that problem-for time is not on the
side of rural Americans.
I appreciate your views on this matter. They will be included in the record of this
proceeding and considered as part of the Commission's review. Please let me know if I can be
of any further assistance.
AA
OFFICE OF
THE CHAIRMAN
FEDERAL COMMUNICATIONS CoMMissioN
WASHINGTON
June 16, 2017
The Honorable Claire McCaskill
United States Senate
730 Hart Senate Office Building
Washington, D.C. 20510
Dear Senator McCaskill:
Thank you for your letter regarding the importance of delivering to all Americans-
including those in high-cost rural areas-affordable access to high-speed Internet access. As you
know, I grew up in Parsons, Kansas and have traveled during my time at the Commission to
locations as varied as Barrow, Alaska, and Diller, Nebraska, and Carthage, Mississippi. I have
seen with my own eyes what access to affordable high-speed Internet access can do for a
community-for its schools, its libraries, and its hospitals, and for those Americans struggling to
stay afloat.
Four years ago, I called on the Commission to tackle the issue of affordable broadband in
rural America head on. The problem back then was that the Universal Service Fund predicated
support on providing voice service. This meant bundled telephone/broadband offers could get
support while standalone broadband could not. The perverse result was that carriers were
incented to take universal service support and offer telephone/broadband bundles (even if
consumers could not afford them) while not offering standalone broadband. The business case
for stand-alone broadband didn't exist for some rural telephone companies-not because
consumers didn't want it, but because our arcane rules penalized companies for offering it.
I wish I could tell you that the FCC has fixed this problem. But as your letter rightly
points out, we have not. Despite the Commission's efforts in the 2016 Rate-of-Return Reform
Order, I still hear from small carriers that offering stand-alone broadband would put them
underwater-that the rates they have to charge exceed the rates for bundled services because of
the different regulatory treatment. This is unfortunate but unsurprising. As I said at the time, the
Order needlessly complicated our rate-of-return system and in many ways made it harder, not
easier, for small providers to serve rural America.
To provide some relief, my colleagues in recent months have urged me to work through a
punch list of lingering issues from the Order. I have accordingly directed staff to work through
that list. In April, the Commission amended a rule that would have disallowed capital expenses
to any project exceeding a Commission-set threshold by even a dollar; now providers can
complete efficient projects so long as they are willing to absorb any costs above the threshold.
That month staff also resolved concerns raised by rural carriers about the "parent-trap" rule. In
May, I circulated an order to address problems with two calculations made in the Order-one
involving a "surrogate method" to avoid duplicative cost-recovery and another involving charges
imposed on stand-alone broadband lines. Also in May, I circulated an order to address certain
duplicative reporting requirements imposed on rural providers. I look forward to continue
working with my colleagues on these issues.
Page 2-The Honorable Claire McCaskill
Although I hope these changes will help, you may be right that something more
fundamental is needed. After all, if the Order is not carrying out its stated purpose of advancing
broadband deployment in rural America, we cannot ignore that problem-for time is not on the
side of rural Americans.
I appreciate your views on this matter. They will be included in the record of this
proceeding and considered as part of the Commission's review. Please let me know if I can be
of any further assistance.
OFFICE OF
THE CHAIRMAN
FEDERAL COMMUNICATIONS COMMISSION
WASHINGTON
June 16, 2017
The Honorable Jeff Merkley
United States Senate
313 Hart Senate Office Building
Washington, D.C. 20510
Dear Senator Merkley:
Thank you for your letter regarding the importance of delivering to all Americans-
including those in high-cost rural areas-affordable access to high-speed Internet access. As you
know, I grew up in Parsons, Kansas and have traveled during my time at the Commission to
locations as varied as Barrow, Alaska, and Diller, Nebraska, and Carthage, Mississippi. I have
seen with my own eyes what access to affordable high-speed Internet access can do for a
community-for its schools, its libraries, and its hospitals, and for those Americans struggling to
stay afloat.
Four years ago, I called on the Commission to tackle the issue of affordable broadband in
rural America head on. The problem back then was that the Universal Service Fund predicated
support on providing voice service. This meant bundled telephone/broadband offers could get
support while standalone broadband could not. The perverse result was that carriers were
incented to take universal service support and offer telephone/broadband bundles (even if
consumers could not afford them) while not offering standalone broadband. The business case
for stand-alone broadband didn't exist for some rural telephone companies-not because
consumers didn't want it, but because our arcane rules penalized companies for offering it.
I wish I could tell you that the FCC has fixed this problem. But as your letter rightly
points out, we have not. Despite the Commission's efforts in the 2016 Rate-of-Return Reform
Order, I still hear from small carriers that offering stand-alone broadband would put them
underwater-that the rates they have to charge exceed the rates for bundled services because of
the different regulatory treatment. This is unfortunate but unsurprising. As I said at the time, the
Order needlessly complicated our rate-of-return system and in many ways made it harder, not
easier, for small providers to serve rural America.
To provide some relief, my colleagues in recent months have urged me to work through a
punch list of lingering issues from the Order. I have accordingly directed staff to work through
that list. In April, the Commission amended a rule that would have disallowed capital expenses
to any project exceeding a Commission-set threshold by even a dollar; now providers can
complete efficient projects so long as they are willing to absorb any costs above the threshold.
That month staff also resolved concerns raised by rural carriers about the "parent-trap" rule. In
May, I circulated an order to address problems with two calculations made in the Order-one
involving a "surrogate method" to avoid duplicative cost-recovery and another involving charges
imposed on stand-alone broadband lines. Also in May, I circulated an order to address certain
duplicative reporting requirements imposed on rural providers. I look forward to continue
working with my colleagues on these issues.
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OFFICE OF
THE CHAIRMAN
FEDERAL COMMUNICATIONS COMMISSION
WASHINGTON
June 16, 2017
The Honorable Jerry Moran
United States Senate
521 Dirksen Senate Office Building
Washington, D.C. 20510
Dear Senator Moran:
Thank you for your letter regarding the importance of delivering to all Americans-
including those in high-cost rural areas-affordable access to high-speed Internet access. As you
know, I grew up in Parsons, Kansas and have traveled during my time at the Commission to
locations as varied as Barrow, Alaska, and Diller, Nebraska, and Carthage, Mississippi. I have
seen with my own eyes what access to affordable high-speed Internet access can do for a
community-for its schools, its libraries, and its hospitals, and for those Americans struggling to
stay afloat.
Four years ago, I called on the Commission to tackle the issue of affordable broadband in
rural America head on. The problem back then was that the Universal Service Fund predicated
support on providing voice service. This meant bundled telephone/broadband offers could get
support while standalone broadband could not. The perverse result was that carriers were
incented to take universal service support and offer telephone/broadband bundles (even if
consumers could not afford them) while not offering standalone broadband. The business case
for stand-alone broadband didn't exist for some rural telephone companies-not because
consumers didn't want it, but because our arcane rules penalized companies for offering it.
I wish I could tell you that the FCC has fixed this problem. But as your letter rightly
points out, we have not. Despite the Commission's efforts in the 2016 Rate-of-Return Reform
Order, I still hear from small carriers that offering stand-alone broadband would put them
underwater-that the rates they have to charge exceed the rates for bundled services because of
the different regulatory treatment. This is unfortunate but unsurprising. As I said at the time, the
Order needlessly complicated our rate-of-return system and in many ways made it harder, not
easier, for small providers to serve rural America.
To provide some relief, my colleagues in recent months have urged me to work through a
punch list of lingering issues from the Order. I have accordingly directed staff to work through
that list. In April, the Commission amended a rule that would have disallowed capital expenses
to any project exceeding a Commission-set threshold by even a dollar; now providers can
complete efficient projects so long as they are willing to absorb any costs above the threshold.
That month staff also resolved concerns raised by rural carriers about the "parent-trap" rule. In
May, I circulated an order to address problems with two calculations made in the Order-one
involving a "surrogate method" to avoid duplicative cost-recovery and another involving charges
imposed on stand-alone broadband lines. Also in May, I circulated an order to address certain
duplicative reporting requirements imposed on rural providers. I look forward to continue
working with my colleagues on these issues.
Page 2-The Honorable Jerry Moran
Although I hope these changes will help, you may be right that something more
fundamental is needed. After all, if the Order is not carrying out its stated purpose of advancing
broadband deployment in rural America, we cannot ignore that problem-for time is not on the
side of rural Americans.
I appreciate your views on this matter. They will be included in the record of this
proceeding and considered as part of the Commission's review. Please let me know if I can be
of any further assistance.
Sincerely,
Ajit V. Pai
OFFICE OF
THE CHAIRMAN
FEDERAL COMMUNICATIONS COMMISSION
WASHINGTON
June 16, 2017
The Honorable Gary Peters
United States Senate
724 Hart Senate Office Building
Washington, D.C. 20510
Dear Senator Peters:
Thank you for your letter regarding the importance of delivering to all Americans-
including those in high-cost rural areas-affordable access to high-speed Internet access. As you
know, I grew up in Parsons, Kansas and have traveled during my time at the Commission to
locations as varied as Barrow, Alaska, and Diller, Nebraska, and Carthage, Mississippi. I have
seen with my own eyes what access to affordable high-speed Internet access can do for a
community-for its schools, its libraries, and its hospitals, and for those Americans struggling to
stay afloat.
Four years ago, I called on the Commission to tackle the issue of affordable broadband in
rural America head on. The problem back then was that the Universal Service Fund predicated
support on providing voice service. This meant bundled telephone/broadband offers could get
support while standalone broadband could not. The perverse result was that carriers were
incented to take universal service support and offer telephone/broadband bundles (even if
consumers could not afford them) while not offering standalone broadband. The business case
for stand-alone broadband didn't exist for some rural telephone companies-not because
consumers didn't want it, but because our arcane rules penalized companies for offering it.
I wish I could tell you that the FCC has fixed this problem. But as your letter rightly
points out, we have not. Despite the Commission's efforts in the 2016 Rate-of-Relurn Reform
Order, I still hear from small carriers that offering stand-alone broadband would put them
underwater-that the rates they have to charge exceed the rates for bundled services because of
the different regulatory treatment. This is unfortunate but unsurprising. As I said at the time, the
Order needlessly complicated our rate-of-return system and in many ways made it harder, not
easier, for small providers to serve rural America.
To provide some relief, my colleagues in recent months have urged me to work through a
punch list of lingering issues from the Order. I have accordingly directed staff to work through
that list. In April, the Commission amended a rule that would have disallowed capital expenses
to any project exceeding a Commission-set threshold by even a dollar; now providers can
complete efficient projects so long as they are willing to absorb any costs above the threshold.
That month staff also resolved concerns raised by rural carriers about the "parent-trap" rule. In
May, I circulated an order to address problems with two calculations made in the Order-one
involving a "surrogate method" to avoid duplicative cost-recovery and another involving charges
imposed on stand-alone broadband lines. Also in May, I circulated an order to address certain
duplicative reporting requirements imposed on rural providers. I look forward to continue
working with my colleagues on these issues.
Page 2-The Honorable Gary Peters
Although I hope these changes will help, you may be right that something more
fundamental is needed. After all, if the Order is not carrying out its stated purpose of advancing
broadband deployment in rural America, we cannot ignore that problem-for time is not on the
side of rural Americans.
I appreciate your views on this matter. They will be included in the record of this
proceeding and considered as part of the Commission's review. Please let me know if I can be
of any further assistance.
Sincerely,
(
	
AjitV.Pai
OFFICE OF
THE CHAIRMAN
FEDERAL COMMUNICATIONS COMMISSION
WASHINGTON
June 16, 2017
The Honorable Rob Portman
United States Senate
448 Russell Senate Office Building
Washington, D.C. 20510
Dear Senator Portman:
Thank you for your letter regarding the importance of delivering to all Americans-
including those in high-cost rural areas-affordable access to high-speed Internet access. As you
know, I grew up in Parsons, Kansas and have traveled during my time at the Commission to
locations as varied as Barrow, Alaska, and Diller, Nebraska, and Carthage, Mississippi. I have
seen with my own eyes what access to affordable high-speed Internet access can do for a
community-for its schools, its libraries, and its hospitals, and for those Americans struggling to
stay afloat.
Four years ago, I called on the Commission to tackle the issue of affordable broadband in
rural America head on. The problem back then was that the Universal Service Fund predicated
support on providing voice service. This meant bundled telephone/broadband offers could get
support while standalone broadband could not. The perverse result was that carriers were
incented to take universal service support and offer telephone/broadband bundles (even if
consumers could not afford them) while not offering standalone broadband. The business case
for stand-alone broadband didn't exist for some rural telephone companies-not because
consumers didn't want it, but because our arcane rules penalized companies for offering it.
I wish I could tell you that the FCC has fixed this problem. But as your letter rightly
points out, we have not. Despite the Commission's efforts in the 2016 Rate-of-Return Reform
Order, I still hear from small carriers that offering stand-alone broadband would put them
underwater-that the rates they have to charge exceed the rates for bundled services because of
the different regulatory treatment. This is unfortunate but unsurprising. As I said at the time, the
Order needlessly complicated our rate-of-return system and in many ways made it harder, not
easier, for small providers to serve rural America.
To provide some relief, my colleagues in recent months have urged me to work through a
punch list of lingering issues from the Order. I have accordingly directed staff to work through
that list. In April, the Commission amended a rule that would have disallowed capital expenses
to any project exceeding a Commission-set threshold by even a dollar; now providers can
complete efficient projects so long as they are willing to absorb any costs above the threshold.
That month staff also resolved concerns raised by rural carriers about the "parent-trap" rule. In
May, I circulated an order to address problems with two calculations made in the Order-one
involving a "surrogate method" to avoid duplicative cost-recovery and another involving charges
imposed on stand-alone broadband lines. Also in May, I circulated an order to address certain
duplicative reporting requirements imposed on rural providers. I look forward to continue
working with my colleagues on these issues.
Page 2-The Honorable Rob Portman
Although I hope these changes will help, you may be right that something more
fundamental is needed. After all, if the Order is not carrying out its stated purpose of advancing
broadband deployment in rural America, we cannot ignore that problem-for time is not on the
side of rural Americans.
I appreciate your views on this matter. They will be included in the record of this
proceeding and considered as part of the Commission's review. Please let me know if I can be
of any further assistance.
Sincerely,
Ajit V. Pai
OFFICE OF
THE CHAIRMAN
FEDERAL COMMUNICATIONS COMMISSION
WASHINGTON
June 16, 2017
The Honorable Pat Roberts
United States Senate
109 Hart Senate Office Building
Washington, D.C. 20510
Dear Senator Roberts:
Thank you for your letter regarding the importance of delivering to all Americans-
including those in high-cost rural areas-affordable access to high-speed Internet access. As you
know, I grew up in Parsons, Kansas and have traveled during my time at the Commission to
locations as varied as Barrow, Alaska, and Diller, Nebraska, and Carthage, Mississippi. I have
seen with my own eyes what access to affordable high-speed Internet access can do for a
community-for its schools, its libraries, and its hospitals, and for those Americans struggling to
stay afloat.
Four years ago, I called on the Commission to tackle the issue of affordable broadband in
rural America head on. The problem back then was that the Universal Service Fund predicated
support on providing voice service. This meant bundled telephone/broadband offers could get
support while standalone broadband could not. The perverse result was that carriers were
incented to take universal service support and offer telephone/broadband bundles (even if
consumers could not afford them) while not offering standalone broadband. The business case
for stand-alone broadband didn't exist for some rural telephone companies-not because
consumers didn't want it, but because our arcane rules penalized companies for offering it.
I wish I could tell you that the FCC has fixed this problem. But as your letter rightly
points out, we have not. Despite the Commission's efforts in the 2016 Rate-of-Return Reform
Order, I still hear from small carriers that offering stand-alone broadband would put them
underwater-that the rates they have to charge exceed the rates for bundled services because of
the different regulatory treatment. This is unfortunate but unsurprising. As I said at the time, the
Order needlessly complicated our rate-of-return system and in many ways made it harder, not
easier, for small providers to serve rural America.
To provide some relief, my colleagues in recent months have urged me to work through a
punch list of lingering issues from the Order. I have accordingly directed staff to work through
that list. In April, the Commission amended a rule that would have disallowed capital expenses
to any project exceeding a Commission-set threshold by even a dollar; now providers can
complete efficient projects so long as they are willing to absorb any costs above the threshold.
That month staff also resolved concerns raised by rural carriers about the "parent-trap" rule. In
May, I circulated an order to address problems with two calculations made in the Order-one
involving a "surrogate method" to avoid duplicative cost-recovery and another involving charges
imposed on stand-alone broadband lines. Also in May, I circulated an order to address certain
duplicative reporting requirements imposed on rural providers. I look forward to continue
working with my colleagues on these issues.
Page 2-The Honorable Pat Roberts
Although I hope these changes will help, you may be right that something more
fundamental is needed. After all, if the Order is not carrying out its stated purpose of advancing
broadband deployment in rural America, we cannot ignore that problem-for time is not on the
side of rural Americans.
I appreciate your views on this matter. They will be included in the record of this
proceeding and considered as part of the Commission's review. Please let me know if I can be
of any further assistance.
OFFICE OF
THE CHAIRMAN
FEDERAL COMMUNICATIONS COMMISSION
WASHINGTON
June 16, 2017
The Honorable Michael Rounds
United States Senate
502 Hart Senate Office Building
Washington, D.C. 20510
Dear Senator Rounds:
Thank you for your letter regarding the importance of delivering to all Americans-
including those in high-cost rural areas-affordable access to high-speed Internet access. As you
know, I grew up in Parsons, Kansas and have traveled during my time at the Commission to
locations as varied as Barrow, Alaska, and Diller, Nebraska, and Carthage, Mississippi. I have
seen with my own eyes what access to affordable high-speed Internet access can do for a
community-for its schools, its libraries, and its hospitals, and for those Americans struggling to
stay afloat.
Four years ago, I called on the Commission to tackle the issue of affordable broadband in
rural America head on. The problem back then was that the Universal Service Fund predicated
support on providing voice service. This meant bundled telephone/broadband offers could get
support while standalone broadband could not. The perverse result was that carriers were
incented to take universal service support and offer telephone/broadband bundles (even if
consumers could not afford them) while not offering standalone broadband. The business case
for stand-alone broadband didn't exist for some rural telephone companies-not because
consumers didn't want it, but because our arcane rules penalized companies for offering it.
I wish I could tell you that the FCC has fixed this problem. But as your letter rightly
points out, we have not. Despite the Commission's efforts in the 2016 Rate-of-Return Reform
Order, I still hear from small carriers that offering stand-alone broadband would put them
underwater-that the rates they have to charge exceed the rates for bundled services because of
the different regulatory treatment. This is unfortunate but unsurprising. As I said at the time, the
Order needlessly complicated our rate-of-return system and in many ways made it harder, not
easier, for small providers to serve rural America.
To provide some relief, my colleagues in recent months have urged me to work through a
punch list of lingering issues from the Order. I have accordingly directed staff to work through
that list. In April, the Commission amended a rule that would have disallowed capital expenses
to any project exceeding a Commission-set threshold by even a dollar; now providers can
complete efficient projects so long as they are willing to absorb any costs above the threshold.
That month staff also resolved concerns raised by rural carriers about the "parent-trap" rule. In
May, I circulated an order to address problems with two calculations made in the Order-one
involving a "surrogate method" to avoid duplicative cost-recovery and another involving charges
imposed on stand-alone broadband lines. Also in May, I circulated an order to address certain
duplicative reporting requirements imposed on rural providers. I look forward to continue
working with my colleagues on these issues.
Page 2-The Honorable Michael Rounds
Although I hope these changes will help, you may be right that something more
fundamental is needed. After all, if the Order is not carrying out its stated purpose of advancing
broadband deployment in rural America, we cannot ignore that problem-for time is not on the
side of rural Americans.
I appreciate your views on this matter. They will be included in the record of this
proceeding and considered as part of the Commission's review. Please let me know if I can be
of any further assistance.
Sincerely,
Ajit V. Pai
OFFICE OF
THE CHAIRMAN
FEDERAL COMMUNICATIONS COMMISSION
WASHINGTON
June 16, 2017
The Honorable Ben Sasse
United States Senate
386A Russell Senate Office Building
Washington, D.C. 20510
Dear Senator Sasse:
Thank you for your letter regarding the importance of delivering to all Americans-
including those in high-cost rural areas-affordable access to high-speed Internet access. As you
know, I grew up in Parsons, Kansas and have traveled during my time at the Commission to
locations as varied as Barrow, Alaska, and Diller, Nebraska, and Carthage, Mississippi. I have
seen with my own eyes what access to affordable high-speed Internet access can do for a
community-for its schools, its libraries, and its hospitals, and for those Americans struggling to
stay afloat.
Four years ago, I called on the Commission to tackle the issue of affordable broadband in
rural America head on. The problem back then was that the Universal Service Fund predicated
support on providing voice service. This meant bundled telephone/broadband offers could get
support while standalone broadband could not. The perverse result was that carriers were
incented to take universal service support and offer telephone/broadband bundles (even if
consumers could not afford them) while not offering standalone broadband. The business case
for stand-alone broadband didn't exist for some rural telephone companies-not because
consumers didn't want it, but because our arcane rules penalized companies for offering it.
I wish I could tell you that the FCC has fixed this problem. But as your letter rightly
points out, we have not. Despite the Commission's efforts in the 2016 Rate-of-Return Reform
Order, I still hear from small carriers that offering stand-alone broadband would put them
underwater-that the rates they have to charge exceed the rates for bundled services because of
the different regulatory treatment. This is unfortunate but unsurprising. As I said at the time, the
Order needlessly complicated our rate-of-return system and in many ways made it harder, not
easier, for small providers to serve rural America.
To provide some relief, my colleagues in recent months have urged me to work through a
punch list of lingering issues from the Order. I have accordingly directed staff to work through
that list. In April, the Commission amended a rule that would have disallowed capital expenses
to any project exceeding a Commission-set threshold by even a dollar; now providers can
complete efficient projects so long as they are willing to absorb any costs above the threshold.
That month staff also resolved concerns raised by rural carriers about the "parent-trap" rule. In
May, I circulated an order to address problems with two calculations made in the Order-one
involving a "surrogate method" to avoid duplicative cost-recovery and another involving charges
imposed on stand-alone broadband lines. Also in May, I circulated an order to address certain
duplicative reporting requirements imposed on rural providers. I look forward to continue
working with my colleagues on these issues.
Page 2-The Honorable Ben Sasse
Although I hope these changes will help, you may be right that something more
fundamental is needed. After all, if the Order is not carrying out its stated purpose of advancing
broadband deployment in rural America, we cannot ignore that problem-for time is not on the
side of rural Americans.
I appreciate your views on this matter. They will be included in the record of this
proceeding and considered as part of the Commission's review. Please let me know if I can be
of any further assistance.
Sincerely,
OFFICE OF
THE CHAIRMAN
FEDERAL COMMUNICATIONS COMMISSION
WASHINGTON
June 16, 2017
The Honorable Tim Scott
United States Senate
520 Hart Senate Office Building
Washington, D.C. 20510
Dear Senator Scott:
Thank you for your letter regarding the importance of delivering to all Americans-
including those in high-cost rural areas---affordable access to high-speed Internet access. As you
know, I grew up in Parsons, Kansas and have traveled during my time at the Commission to
locations as varied as Barrow, Alaska, and Diller, Nebraska, and Carthage, Mississippi. I have
seen with my own eyes what access to affordable high-speed Internet access can do for a
community-for its schools, its libraries, and its hospitals, and for those Americans struggling to
stay afloat.
Four years ago, I called on the Commission to tackle the issue of affordable broadband in
rural America head on. The problem back then was that the Universal Service Fund predicated
support on providing voice service. This meant bundled telephone/broadband offers could get
support while standalone broadband could not. The perverse result was that carriers were
incented to take universal service support and offer telephone/broadband bundles (even if
consumers could not afford them) while not offering standalone broadband. The business case
for stand-alone broadband didn't exist for some rural telephone companies-not because
consumers didn't want it, but because our arcane rules penalized companies for offering it.
I wish I could tell you that the FCC has fixed this problem. But as your letter rightly
points out, we have not. Despite the Commission's efforts in the 2016 Rate-of-Return Reform
Order, I still hear from small carriers that offering stand-alone broadband would put them
underwater-that the rates they have to charge exceed the rates for bundled services because of
the different regulatory treatment. This is unfortunate but unsurprising. As I said at the time, the
Order needlessly complicated our rate-of-return system and in many ways made it harder, not
easier, for small providers to serve rural America.
To provide some relief, my colleagues in recent months have urged me to work through a
punch list of lingering issues from the Order. I have accordingly directed staff to work through
that list. In April, the Commission amended a rule that would have disallowed capital expenses
to any project exceeding a Commission-set threshold by even a dollar; now providers can
complete efficient projects so long as they are willing to absorb any costs above the threshold.
That month staff also resolved concerns raised by rural carriers about the "parent-trap" rule. In
May, I circulated an order to address problems with two calculations made in the Order-one
involving a "surrogate method" to avoid duplicative cost-recovery and another involving charges
imposed on stand-alone broadband lines. Also in May, I circulated an order to address certain
duplicative reporting requirements imposed on rural providers. I look forward to continue
working with my colleagues on these issues.
Page 2-The Honorable Tim Scott
Although I hope these changes will help, you may be right that something more
fundamental is needed. After all, if the Order is not carrying out its stated purpose of advancing
broadband deployment in rural America, we cannot ignore that problem-for time is not on the
side of rural Americans.
I appreciate your views on this matter. They will be included in the record of this
proceeding and considered as part of the Commission's review. Please let me know if I can be
of any further assistance.
Sincerely,
Ajit V. Pai
OFFICE OF
THE CHAIRMAN
FEDERAL COMMUNICATIONS COMMISSION
WASHINGTON
June 16, 2017
The Honorable Jeanne Shaheen
United States Senate
506 Hart Senate Office Building
Washington, D.C. 20510
Dear Senator Shaheen:
Thank you for your letter regarding the importance of delivering to all Americans-
including those in high-cost rural areas-affordable access to high-speed Internet access. As you
know, I grew up in Parsons, Kansas and have traveled during my time at the Commission to
locations as varied as Barrow, Alaska, and Diller, Nebraska, and Carthage, Mississippi. I have
seen with my own eyes what access to affordable highspeed Internet access can do for a
community-for its schools, its libraries, and its hospitals, and for those Americans struggling to
stay afloat.
Four years ago, I called on the Commission to tackle the issue of affordable broadband in
rural America head on. The problem back then was that the Universal Service Fund predicated
support on providing voice service. This meant bundled telephone/broadband offers could get
support while standalone broadband could not. The perverse result was that carriers were
incented to take universal service support and offer telephone/broadband bundles (even if
consumers could not afford them) while not offering standalone broadband. The business case
for stand-alone broadband didn't exist for some rural telephone companies-not because
consumers didn't want it, but because our arcane rules penalized companies for offering it.
I wish I could tell you that the FCC has fixed this problem. But as your letter rightly
points out, we have not. Despite the Commission's efforts in the 2016 Rate-of-Return Reform
Order, I still hear from small carriers that offering stand-alone broadband would put them
underwater-that the rates they have to charge exceed the rates for bundled services because of
the different regulatory treatment. This is unfortunate but unsurprising. As I said at the time, the
Order needlessly complicated our rate-of-return system and in many ways made it harder, not
easier, for small providers to serve rural America.
To provide some relief, my colleagues in recent months have urged me to work through a
punch list of lingering issues from the Order. I have accordingly directed staff to work through
that list. In April, the Commission amended a rule that would have disallowed capital expenses
to any project exceeding a Commission-set threshold by even a dollar; now providers can
complete efficient projects so long as they are willing to absorb any costs above the threshold.
That month staff also resolved concerns raised by rural carriers about the "parent-trap" rule. In
May, I circulated an order to address problems with two calculations made in the Order-one
involving a "surrogate method" to avoid duplicative cost-recovery and another involving charges
imposed on stand-alone broadband lines. Also in May, I circulated an order to address certain
duplicative reporting requirements imposed on rural providers. I look forward to continue
working with my colleagues on these issues.
Page 2-The Honorable Jeanne Shaheen
Although I hope these changes will help, you may be right that something more
fundamental is needed. After all, if the Order is not carrying out its stated purpose of advancing
broadband deployment in rural America, we cannot ignore that problem-for time is not on the
side of rural Americans.
I appreciate your views on this matter. They will be included in the record of this
proceeding and considered as part of the Commission's review. Please let me know if I can be
of any further assistance.
Sincerely,
JkJit V. Yai
OFFICE OF
THE CHAIRMAN
FEDERAL COMMUNICATIONS COMMISSION
WASHINGTON
June 16, 2017
The Honorable Debbie Stabenow
United States Senate
731 Hart Senate Office Building
Washington, D.C. 20510
Dear Senator Stabenow:
Thank you for your letter regarding the importance of delivering to all Americans-
including those in high-cost rural areas-affordable access to high-speed Internet access. As you
know, I grew up in Parsons, Kansas and have traveled during my time at the Commission to
locations as varied as Barrow, Alaska, and Diller, Nebraska, and Carthage, Mississippi. I have
seen with my own eyes what access to affordable high-speed Internet access can do for a
community-for its schools, its libraries, and its hospitals, and for those Americans struggling to
stay afloat.
Four years ago, I called on the Commission to tackle the issue of affordable broadband in
rural America head on. The problem back then was that the Universal Service Fund predicated
support on providing voice service. This meant bundled telephone/broadband offers could get
support while standalone broadband could not. The perverse result was that carriers were
incented to take universal service support and offer telephone/broadband bundles (even if
consumers could not afford them) while not offering standalone broadband. The business case
for stand-alone broadband didn't exist for some rural telephone companies-not because
consumers didn't want it, but because our arcane rules penalized companies for offering it.
I wish I could tell you that the FCC has fixed this problem. But as your letter rightly
points out, we have not. Despite the Commission's efforts in the 2016 Rate-of-Return Reform
Order, I still hear from small carriers that offering stand-alone broadband would put them
underwater-that the rates they have to charge exceed the rates for bundled services because of
the different regulatory treatment. This is unfortunate but unsurprising. As I said at the time, the
Order needlessly complicated our rate-of-return system and in many ways made it harder, not
easier, for small providers to serve rural America.
To provide some relief, my colleagues in recent months have urged me to work through a
punch list of lingering issues from the Order. I have accordingly directed staff to work through
that list. In April, the Commission amended a rule that would have disallowed capital expenses
to any project exceeding a Commission-set threshold by even a dollar; now providers can
complete efficient projects so long as they are willing to absorb any costs above the threshold.
That month staff also resolved concerns raised by rural carriers about the "parent-trap" rule. In
May, I circulated an order to address problems with two calculations made in the Order-one
involving a "surrogate method" to avoid duplicative cost-recovery and another involving charges
imposed on stand-alone broadband lines. Also in May, I circulated an order to address certain
duplicative reporting requirements imposed on rural providers. I look forward to continue
working with my colleagues on these issues.
Page 2-The Honorable Debbie Stabenow
Although I hope these changes will help, you may be right that something more
fundamental is needed. After all, if the Order is not carrying out its stated purpose of advancing
broadband deployment in rural America, we cannot ignore that problem-for time is not on the
side of rural Americans.
I appreciate your views on this matter. They will be included in the record of this
proceeding and considered as part of the Commission's review. Please let me know if I can be
of any further assistance.
Sincerely,
Ov
Ajit V. Pai
OFFICE OF
THE CHAIRMAN
FEDERAL COMMUNICATIONS COMMISSION
WASHINGTON
June 16, 2017
The Honorable Jon Tester
United States Senate
311 Hart Senate Office Building
Washington, D.C. 20510
Dear Senator Tester:
Thank you for your letter regarding the importance of delivering to all Americans-
including those in high-cost rural areas-affordable access to high-speed Internet access. As you
know, I grew up in Parsons, Kansas and have traveled during my time at the Commission to
locations as varied as Barrow, Alaska, and Diller, Nebraska, and Carthage, Mississippi. I have
seen with my own eyes what access to affordable high-speed Internet access can do for a
community-for its schools, its libraries, and its hospitals, and for those Americans struggling to
stay afloat.
Four years ago, I called on the Commission to tackle the issue of affordable broadband in
rural America head on. The problem back then was that the Universal Service Fund predicated
support on providing voice service. This meant bundled telephone/broadband offers could get
support while standalone broadband could not. The perverse result was that carriers were
incented to take universal service support and offer telephone/broadband bundles (even if
consumers could not afford them) while not offering standalone broadband. The business case
for stand-alone broadband didn't exist for some rural telephone companies-not because
consumers didn't want it, but because our arcane rules penalized companies for offering it.
I wish I could tell you that the FCC has fixed this problem. But as your letter rightly
points out, we have not. Despite the Commission's efforts in the 2016 Rate-of-Return Reform
Order, I still hear from small carriers that offering stand-alone broadband would put them
underwater-that the rates they have to charge exceed the rates for bundled services because of
the different regulatory treatment. This is unfortunate but unsurprising. As I said at the time, the
Order needlessly complicated our rate-of-return system and in many ways made it harder, not
easier, for small providers to serve rural America.
To provide some relief, my colleagues in recent months have urged me to work through a
punch list of lingering issues from the Order. I have accordingly directed staff to work through
that list. In April, the Commission amended a rule that would have disallowed capital expenses
to any project exceeding a Commission-set threshold by even a dollar; now providers can
complete efficient projects so long as they are willing to absorb any costs above the threshold.
That month staff also resolved concerns raised by rural carriers about the "parent-trap" rule. In
May, I circulated an order to address problems with two calculations made in the Order-one
involving a "surrogate method" to avoid duplicative cost-recovery and another involving charges
imposed on stand-alone broadband lines. Also in May, I circulated an order to address certain
duplicative reporting requirements imposed on rural providers. I look forward to continue
working with my colleagues on these issues.
P a g e  2 - T h e  H o n o r a b l e  J o n  T e s t e r
A l t h o u g h  I  h o p e  t h e s e  c h a n g e s  w i l l  h e l p ,  y o u  m a y  b e  r i g h t  t h a t  s o m e t h i n g  m o r e
f u n d a m e n t a l  i s  n e e d e d .  A f t e r  a l l ,  i f  t h e O r d e r i s  n o t  c a r r y i n g  o u t  i t s  s t a t e d  p u r p o s e  o f  a d v a n c i n g
b r o a d b a n d  d e p l o y m e n t  i n  r u r a l  A m e r i c a ,  w e  c a n n o t  i g n o r e  t h a t  p r o b l e m - f o r  t i m e  i s  n o t  o n  t h e
s i d e  o f  r u r a l  A m e r i c a n s .
I  a p p r e c i a t e  y o u r  v i e w s  o n  t h i s  m a t t e r .  T h e y  w i l l  b e  i n c l u d e d  i n  t h e  r e c o r d  o f  t h i s
p r o c e e d i n g  a n d  c o n s i d e r e d  a s  p a r t  o f  t h e  C o m m i s s i o n ' s  r e v i e w .  P l e a s e  l e t  m e  k n o w  i f  I  c a n  b e
o f  a n y  f u r t h e r  a s s i s t a n c e .
S i n c e r e l y ,
A j i t  V .  P a i
OFFICE OF
THE CHAIRMAN
FEDERAL COMMUNICATIONS COMMISSION
WASHINGTON
June 16, 2017
The Honorable John Thune
United States Senate
511 Dirksen Senate Office Building
Washington, D.C. 20510
Dear Senator Thune:
Thank you for your letter regarding the importance of delivering to all Americans-
including those in high-cost rural areas-affordable access to high-speed Internet access. As you
know, I grew up in Parsons, Kansas and have traveled during my time at the Commission to
locations as varied as Barrow, Alaska, and Diller, Nebraska, and Carthage, Mississippi. I have
seen with my own eyes what access to affordable high-speed Internet access can do for a
community-for its schools, its libraries, and its hospitals, and for those Americans struggling to
stay afloat.
Four years ago, I called on the Commission to tackle the issue of affordable broadband in
rural America head on. The problem back then was that the Universal Service Fund predicated
support on providing voice service. This meant bundled telephone/broadband offers could get
support while standalone broadband could not. The perverse result was that carriers were
incented to take universal service support and offer telephone/broadband bundles (even if
consumers could not afford them) while not offering standalone broadband. The business case
for stand-alone broadband didn't exist for some rural telephone companies-not because
consumers didn't want it, but because our arcane rules penalized companies for offering it.
I wish I could tell you that the FCC has fixed this problem. But as your letter rightly
points out, we have not. Despite the Commission's efforts in the 2016 Rate-of-Return Reform
Order, I still hear from small carriers that offering stand-alone broadband would put them
underwater-that the rates they have to charge exceed the rates for bundled services because of
the different regulatory treatment. This is unfortunate but unsurprising. As I said at the time, the
Order needlessly complicated our rate-of-return system and in many ways made it harder, not
easier, for small providers to serve rural America.
To provide some relief, my colleagues in recent months have urged me to work through a
punch list of lingering issues from the Order. I have accordingly directed staff to work through
that list. In April, the Commission amended a rule that would have disallowed capital expenses
to any project exceeding a Commission-set threshold by even a dollar; now providers can
complete efficient projects so long as they are willing to absorb any costs above the threshold.
That month staff also resolved concerns raised by rural carriers about the "parent-trap" rule. In
May, I circulated an order to address problems with two calculations made in the Order-one
involving a "surrogate method" to avoid duplicative cost-recovery and another involving charges
imposed on stand-alone broadband lines. Also in May, I circulated an order to address certain
duplicative reporting requirements imposed on rural providers. I look forward to continue
working with my colleagues on these issues.
P a g e  2 - T h e  H o n o r a b l e  J o h n  T h u n e
A l t h o u g h  I  h o p e  t h e s e  c h a n g e s  w i l l  h e l p ,  y o u  m a y  b e  r i g h t  t h a t  s o m e t h i n g  m o r e
f u n d a m e n t a l  i s  n e e d e d .  A f t e r  a l l ,  i f  t h e O r d e r i s  n o t  c a r r y i n g  o u t  i t s  s t a t e d  p u r p o s e  o f  a d v a n c i n g
b r o a d b a n d  d e p l o y m e n t  i n  r u r a l  A m e r i c a ,  w e  c a n n o t  i g n o r e  t h a t  p r o b l e m - f o r  t i m e  i s  n o t  o n  t h e
s i d e  o f  r u r a l  A m e r i c a n s .
I  a p p r e c i a t e  y o u r  v i e w s  o n  t h i s  m a t t e r .  T h e y  w i l l  b e  i n c l u d e d  i n  t h e  r e c o r d  o f  t h i s
p r o c e e d i n g  a n d  c o n s i d e r e d  a s  p a r t  o f  t h e  C o m m i s s i o n ' s  r e v i e w .  P l e a s e  l e t  m e  k n o w  i f  I  c a n  b e
o f  a n y  f u r t h e r  a s s i s t a n c e .
S i n c e r e l y ,  ,
A j i t  V .  P a i
O F F I C E  O F
T H E  C H A I R M A N
F E D E R A L  C O M M U N I C A T I O N S  C O M M I S S I O N
W A S H I N G T O N
J u n e  1 6 ,  2 0 1 7
T h e  H o n o r a b l e  T h o m  T i l l i s
U n i t e d  S t a t e s  S e n a t e
1 8 5  D i r k s e n  S e n a t e  O f f i c e  B u i l d i n g
W a s h i n g t o n ,  D . C .  2 0 5 1 0
D e a r  S e n a t o r  T i l l i s :
T h a n k  y o u  f o r  y o u r  l e t t e r  r e g a r d i n g  t h e  i m p o r t a n c e  o f  d e l i v e r i n g  t o  a l l  A m e r i c a n s -
i n c l u d i n g  t h o s e  i n  h i g h - c o s t  r u r a l  a r e a s - a f f o r d a b l e  a c c e s s  t o  h i g h - s p e e d  I n t e r n e t  a c c e s s .  A s  y o u
k n o w ,  I  g r e w  u p  i n  P a r s o n s ,  K a n s a s  a n d  h a v e  t r a v e l e d  d u r i n g  m y  t i m e  a t  t h e  C o m m i s s i o n  t o
l o c a t i o n s  a s  v a r i e d  a s  B a r r o w ,  A l a s k a ,  a n d  D i l l e r ,  N e b r a s k a ,  a n d  C a r t h a g e ,  M i s s i s s i p p i .  I  h a v e
s e e n  w i t h  m y  o w n  e y e s  w h a t  a c c e s s  t o  a f f o r d a b l e  h i g h - s p e e d  I n t e r n e t  a c c e s s  c a n  d o  f o r  a
c o m m u n i t y - f o r  i t s  s c h o o l s ,  i t s  l i b r a r i e s ,  a n d  i t s  h o s p i t a l s ,  a n d  f o r  t h o s e  A m e r i c a n s  s t r u g g l i n g  t o
s t a y  a f l o a t .
F o u r  y e a r s  a g o ,  I  c a l l e d  o n  t h e  C o m m i s s i o n  t o  t a c k l e  t h e  i s s u e  o f  a f f o r d a b l e  b r o a d b a n d  i n
r u r a l  A m e r i c a  h e a d  o n .  T h e  p r o b l e m  b a c k  t h e n  w a s  t h a t  t h e  U n i v e r s a l  S e r v i c e  F u n d  p r e d i c a t e d
s u p p o r t  o n  p r o v i d i n g  v o i c e  s e r v i c e .  T h i s  m e a n t  b u n d l e d  t e l e p h o n e / b r o a d b a n d  o f f e r s  c o u l d  g e t
s u p p o r t  w h i l e  s t a n d a l o n e  b r o a d b a n d  c o u l d  n o t .  T h e  p e r v e r s e  r e s u l t  w a s  t h a t  c a r r i e r s  w e r e
i n c e n t e d  t o  t a k e  u n i v e r s a l  s e r v i c e  s u p p o r t  a n d  o f f e r  t e l e p h o n e / b r o a d b a n d  b u n d l e s  ( e v e n  i f
c o n s u m e r s  c o u l d  n o t  a f f o r d  t h e m )  w h i l e  n o t  o f f e r i n g  s t a n d a l o n e  b r o a d b a n d .  T h e  b u s i n e s s  c a s e
f o r  s t a n d - a l o n e  b r o a d b a n d  d i d n ' t  e x i s t  f o r  s o m e  r u r a l  t e l e p h o n e  c o m p a n i e s - n o t  b e c a u s e
c o n s u m e r s  d i d n ' t  w a n t  i t ,  b u t  b e c a u s e  o u r  a r c a n e  r u l e s  p e n a l i z e d  c o m p a n i e s  f o r  o f f e r i n g  i t .
I w i s h  I  c o u l d  t e l l  y o u  t h a t  t h e  F C C  h a s  f i x e d  t h i s  p r o b l e m .  B u t  a s  y o u r  l e t t e r  r i g h t l y
p o i n t s  o u t ,  w e  h a v e  n o t .  D e s p i t e  t h e  C o m m i s s i o n ' s  e f f o r t s  i n  t h e  2 0 1 6 R a t e - o f - R e t u r n  R e f o r m
O r d e r ,  I  s t i l l  h e a r  f r o m  s m a l l  c a r r i e r s  t h a t  o f f e r i n g  s t a n d - a l o n e  b r o a d b a n d  w o u l d  p u t  t h e m
u n d e r w a t e r - t h a t  t h e  r a t e s  t h e y  h a v e  t o  c h a r g e  e x c e e d  t h e  r a t e s  f o r  b u n d l e d  s e r v i c e s  b e c a u s e  o f
t h e  d i f f e r e n t  r e g u l a t o r y  t r e a t m e n t .  T h i s  i s  u n f o r t u n a t e  b u t  u n s u r p r i s i n g .  A s  I  s a i d  a t  t h e  t i m e ,  t h e
O r d e r n e e d l e s s l y  c o m p l i c a t e d  o u r  r a t e - o f - r e t u r n  s y s t e m  a n d  i n  m a n y  w a y s  m a d e  i t  h a r d e r ,  n o t
e a s i e r ,  f o r  s m a l l  p r o v i d e r s  t o  s e r v e  r u r a l A m e r i c a .
T o  p r o v i d e  s o m e  r e l i e f ,  m y  c o l l e a g u e s  i n  r e c e n t  m o n t h s  h a v e  u r g e d  m e  t o  w o r k  t h r o u g h  a
p u n c h  l i s t  o f  l i n g e r i n g  i s s u e s  f r o m  t h e O r d e r . I h a v e  a c c o r d i n g l y  d i r e c t e d  s t a f f  t o  w o r k  t h r o u g h
t h a t  l i s t .  I n  A p r i l ,  t h e  C o m m i s s i o n  a m e n d e d  a  r u l e  t h a t  w o u l d  h a v e  d i s a l l o w e d  c a p i t a l  e x p e n s e s
t o  a n y  p r o j e c t  e x c e e d i n g  a  C o m m i s s i o n - s e t  t h r e s h o l d  b y  e v e n  a  d o l l a r ;  n o w  p r o v i d e r s  c a n
c o m p l e t e  e f f i c i e n t  p r o j e c t s  s o  l o n g  a s  t h e y  a r e  w i l l i n g  t o  a b s o r b  a n y  c o s t s  a b o v e  t h e  t h r e s h o l d .
T h a t  m o n t h  s t a f f  a l s o  r e s o l v e d  c o n c e r n s  r a i s e d  b y  r u r a l  c a r r i e r s  a b o u t  t h e  " p a r e n t - t r a p "  r u l e .  I n
M a y ,  I  c i r c u l a t e d  a n  o r d e r  t o  a d d r e s s  p r o b l e m s  w i t h  t w o  c a l c u l a t i o n s  m a d e  i n  t h e O r d e r - o n e
i n v o l v i n g  a  " s u r r o g a t e  m e t h o d "  t o  a v o i d  d u p l i c a t i v e  c o s t - r e c o v e r y  a n d  a n o t h e r  i n v o l v i n g  c h a r g e s
i m p o s e d  o n  s t a n d - a l o n e  b r o a d b a n d  l i n e s .  A l s o  i n  M a y ,  I  c i r c u l a t e d  a n  o r d e r  t o  a d d r e s s  c e r t a i n
d u p l i c a t i v e  r e p o r t i n g  r e q u i r e m e n t s  i m p o s e d  o n  r u r a l  p r o v i d e r s .  I  l o o k  f o r w a r d  t o  c o n t i n u e
w o r k i n g  w i t h  m y  c o l l e a g u e s  o n  t h e s e  i s s u e s .
P a g e  2 - T h e  H o n o r a b l e  T h o m  T i l l i s
A l t h o u g h  I  h o p e  t h e s e  c h a n g e s  w i l l  h e l p ,  y o u  m a y  b e  r i g h t  t h a t  s o m e t h i n g  m o r e
f u n d a m e n t a l  i s  n e e d e d .  A f t e r  a l l ,  i f  t h e O r d e r i s  n o t  c a r r y i n g  o u t  i t s  s t a t e d  p u r p o s e  o f  a d v a n c i n g
b r o a d b a n d  d e p l o y m e n t  i n  r u r a l  A m e r i c a ,  w e  c a n n o t  i g n o r e  t h a t  p r o b l e m - f o r  t i m e  i s  n o t  o n  t h e
s i d e  o f  r u r a l  A m e r i c a n s .
I  a p p r e c i a t e  y o u r  v i e w s  o n  t h i s  m a t t e r .  T h e y  w i l l  b e  i n c l u d e d  i n  t h e  r e c o r d  o f  t h i s
p r o c e e d i n g  a n d  c o n s i d e r e d  a s  p a r t  o f  t h e  C o m m i s s i o n ' s  r e v i e w .  P l e a s e  l e t  m e  k n o w  i f  I  c a n  b e
o f  a n y  f u r t h e r  a s s i s t a n c e .
i ' l S i n c e r e l y ,' /
	
( I
U
O F F I C E  O F
T H E  C H A I R M A N
F E D E R A L  C O M M U N I C A T I O N S  C O M M I S S I O N
W A S H I N G T O N
J u n e  1 6 ,  2 0 1 7
T h e  H o n o r a b l e  R o g e r  W i c k e r
U n i t e d  S t a t e s  S e n a t e
5 5 5 D i r k s e n  S e n a t e  O f f i c e  B u i l d i n g
W a s h i n g t o n ,  D . C .  2 0 5 1 0
D e a r  S e n a t o r  W i c k e r :
T h a n k  y o u  f o r  y o u r  l e t t e r  r e g a r d i n g  t h e  i m p o r t a n c e  o f  d e l i v e r i n g  t o  a l l  A m e r i c a n s -
i n c l u d i n g  t h o s e  i n  h i g h - c o s t  r u r a l  a r e a s - a f f o r d a b l e  a c c e s s  t o  h i g h - s p e e d  I n t e r n e t  a c c e s s .  A s  y o u
k n o w ,  I  g r e w  u p  i n  P a r s o n s ,  K a n s a s  a n d  h a v e  t r a v e l e d  d u r i n g  m y  t i m e  a t  t h e  C o m m i s s i o n  t o
l o c a t i o n s  a s  v a r i e d  a s  B a r r o w ,  A l a s k a ,  a n d  D i l l e r ,  N e b r a s k a ,  a n d  C a r t h a g e ,  M i s s i s s i p p i .  I  h a v e
s e e n  w i t h  m y  o w n  e y e s  w h a t  a c c e s s  t o  a f f o r d a b l e  h i g h - s p e e d  I n t e r n e t  a c c e s s  c a n  d o  f o r  a
c o m m u n i t y - f o r  i t s  s c h o o l s ,  i t s  l i b r a r i e s ,  a n d  i t s  h o s p i t a l s ,  a n d  f o r  t h o s e  A m e r i c a n s  s t r u g g l i n g  t o
s t a y  a f l o a t .
F o u r  y e a r s  a g o ,  I  c a l l e d  o n  t h e  C o m m i s s i o n  t o  t a c k l e  t h e  i s s u e  o f  a f f o r d a b l e  b r o a d b a n d  i n
r u r a l  A m e r i c a  h e a d  o n .  T h e  p r o b l e m  b a c k  t h e n  w a s  t h a t  t h e  U n i v e r s a l  S e r v i c e  F u n d  p r e d i c a t e d
s u p p o r t  o n  p r o v i d i n g  v o i c e  s e r v i c e .  T h i s  m e a n t  b u n d l e d  t e l e p h o n e / b r o a d b a n d  o f f e r s  c o u l d  g e t
s u p p o r t  w h i l e  s t a n d a l o n e  b r o a d b a n d  c o u l d  n o t .  T h e  p e r v e r s e  r e s u l t  w a s  t h a t  c a r r i e r s  w e r e
i n c e n t e d  t o  t a k e  u n i v e r s a l  s e r v i c e  s u p p o r t  a n d  o f f e r  t e l e p h o n e / b r o a d b a n d  b u n d l e s  ( e v e n  i f
c o n s u m e r s  c o u l d  n o t  a f f o r d  t h e m )  w h i l e  n o t  o f f e r i n g  s t a n d a l o n e  b r o a d b a n d .  T h e  b u s i n e s s  c a s e
f o r  s t a n d - a l o n e  b r o a d b a n d  d i d n ' t  e x i s t  f o r  s o m e  r u r a l  t e l e p h o n e  c o m p a n i e s - n o t  b e c a u s e
c o n s u m e r s  d i d n ' t  w a n t  i t ,  b u t  b e c a u s e  o u r  a r c a n e  r u l e s  p e n a l i z e d  c o m p a n i e s  f o r  o f f e r i n g  i t .
I w i s h  I  c o u l d  t e l l  y o u  t h a t  t h e  F C C  h a s  f i x e d  t h i s  p r o b l e m .  B u t  a s  y o u r  l e t t e r  r i g h t l y
p o i n t s  o u t ,  w e  h a v e  n o t .  D e s p i t e  t h e  C o m m i s s i o n ' s  e f f o r t s  i n  t h e  2 0 1 6 R a t e - o f - R e t u r n  R e f o r m
O r d e r ,  I  s t i l l  h e a r  f r o m  s m a l l  c a r r i e r s  t h a t  o f f e r i n g  s t a n d - a l o n e  b r o a d b a n d  w o u l d  p u t  t h e m
u n d e r w a t e r - t h a t  t h e  r a t e s  t h e y  h a v e  t o  c h a r g e  e x c e e d  t h e  r a t e s  f o r  b u n d l e d  s e r v i c e s  b e c a u s e  o f
t h e  d i f f e r e n t  r e g u l a t o r y  t r e a t m e n t .  T h i s  i s  u n f o r t u n a t e  b u t  u n s u r p r i s i n g .  A s  I  s a i d  a t  t h e  t i m e ,  t h e
O r d e r n e e d l e s s l y  c o m p l i c a t e d  o u r  r a t e - o f - r e t u r n  s y s t e m  a n d  i n  m a n y  w a y s  m a d e  i t  h a r d e r ,  n o t
e a s i e r ,  f o r  s m a l l  p r o v i d e r s  t o  s e r v e  r u r a l  A m e r i c a .
T o  p r o v i d e  s o m e  r e l i e f ,  m y  c o l l e a g u e s  i n  r e c e n t  m o n t h s  h a v e  u r g e d  m e  t o  w o r k  t h r o u g h  a
p u n c h  l i s t  o f  l i n g e r i n g  i s s u e s  f r o m  t h e O r d e r . I  h a v e  a c c o r d i n g l y  d i r e c t e d  s t a f f  t o  w o r k  t h r o u g h
t h a t  l i s t .  I n  A p r i l ,  t h e  C o m m i s s i o n  a m e n d e d  a  r u l e  t h a t  w o u l d  h a v e  d i s a l l o w e d  c a p i t a l  e x p e n s e s
t o  a n y  p r o j e c t  e x c e e d i n g  a  C o m m i s s i o n - s e t  t h r e s h o l d  b y  e v e n  a  d o l l a r ;  n o w  p r o v i d e r s  c a n
c o m p l e t e  e f f i c i e n t  p r o j e c t s  s o  l o n g  a s  t h e y  a r e  w i l l i n g  t o  a b s o r b  a n y  c o s t s  a b o v e  t h e  t h r e s h o l d .
T h a t  m o n t h  s t a f f  a l s o  r e s o l v e d  c o n c e r n s  r a i s e d  b y  r u r a l  c a r r i e r s  a b o u t  t h e  " p a r e n t - t r a p "  r u l e .  I n
M a y ,  I  c i r c u l a t e d  a n  o r d e r  t o  a d d r e s s  p r o b l e m s  w i t h  t w o  c a l c u l a t i o n s  m a d e  i n  t h e O r d e r - o n e
i n v o l v i n g  a  " s u r r o g a t e  m e t h o d "  t o  a v o i d  d u p l i c a t i v e  c o s t - r e c o v e r y  a n d  a n o t h e r  i n v o l v i n g  c h a r g e s
i m p o s e d  o n  s t a n d - a l o n e  b r o a d b a n d  l i n e s .  A l s o  i n  M a y ,  I  c i r c u l a t e d  a n  o r d e r  t o  a d d r e s s  c e r t a i n
d u p l i c a t i v e  r e p o r t i n g  r e q u i r e m e n t s  i m p o s e d  o n  r u r a l  p r o v i d e r s .  I  l o o k  f o r w a r d  t o  c o n t i n u e
w o r k i n g  w i t h  m y  c o l l e a g u e s  o n  t h e s e  i s s u e s .
P a g e  2 - T h e  H o n o r a b l e  R o g e r  W i c k e r
A l t h o u g h  I  h o p e  t h e s e  c h a n g e s  w i l l  h e l p ,  y o u  m a y  b e  r i g h t  t h a t  s o m e t h i n g  m o r e
f u n d a m e n t a l  i s  n e e d e d .  A f t e r  a l l ,  i f  t h e O r d e r i s  n o t  c a r r y i n g  o u t  i t s  s t a t e d  p u r p o s e  o f  a d v a n c i n g
b r o a d b a n d  d e p l o y m e n t  i n  r u r a l  A m e r i c a ,  w e  c a n n o t  i g n o r e  t h a t  p r o b l e m - f o r  t i m e  i s  n o t  o n  t h e
s i d e  o f  r u r a l  A m e r i c a n s .
I  a p p r e c i a t e  y o u r  v i e w s  o n  t h i s  m a t t e r .  T h e y  w i l l  b e  i n c l u d e d  i n  t h e  r e c o r d  o f  t h i s
p r o c e e d i n g  a n d  c o n s i d e r e d  a s  p a r t  o f  t h e  C o m m i s s i o n ' s  r e v i e w .  P l e a s e  l e t  m e  k n o w  i f  I  c a n  b e
o f  a n y  f u r t h e r  a s s i s t a n c e .
S i n c e r e l y ,
v
A j i t V .  P a i
O F F I C E  O F
T H E  C H A I R M A N
F E D E R A L  C O M M U N I C A T I O N S  C O M M I S S I O N
W A S H I N G T O N
J u n e  1 6 ,  2 0 1 7
T h e  H o n o r a b l e  R o n  W y d e n
U n i t e d  S t a t e s  S e n a t e
2 2 1  D i r k s e n  S e n a t e  O f f i c e  B u i l d i n g
W a s h i n g t o n ,  D . C .  2 0 5 1 0
D e a r  S e n a t o r  W y d e n :
T h a n k  y o u  f o r  y o u r  l e t t e r  r e g a r d i n g  t h e  i m p o r t a n c e  o f  d e l i v e r i n g  t o  a l l  A m e r i c a n s -
i n c l u d i n g  t h o s e  i n  h i g h - c o s t  r u r a l  a r e a s - a f f o r d a b l e  a c c e s s  t o  h i g h - s p e e d  I n t e r n e t  a c c e s s .  A s  y o u
k n o w ,  I  g r e w  u p  i n  P a r s o n s ,  K a n s a s  a n d  h a v e  t r a v e l e d  d u r i n g  m y  t i m e  a t  t h e  C o m m i s s i o n  t o
l o c a t i o n s  a s  v a r i e d  a s  B a r r o w ,  A l a s k a ,  a n d  D i l l e r ,  N e b r a s k a ,  a n d  C a r t h a g e ,  M i s s i s s i p p i .  I  h a v e
s e e n  w i t h  m y  o w n  e y e s  w h a t  a c c e s s  t o  a f f o r d a b l e  h i g h - s p e e d  I n t e r n e t  a c c e s s  c a n  d o  f o r  a
c o m m u n i t y - f o r  i t s  s c h o o l s ,  i t s  l i b r a r i e s ,  a n d  i t s  h o s p i t a l s ,  a n d  f o r  t h o s e  A m e r i c a n s  s t r u g g l i n g  t o
s t a y  a f l o a t .
F o u r  y e a r s  a g o ,  I  c a l l e d  o n  t h e  C o m m i s s i o n  t o  t a c k l e  t h e  i s s u e  o f  a f f o r d a b l e  b r o a d b a n d  i n
r u r a l  A m e r i c a  h e a d  o n .  T h e  p r o b l e m  b a c k  t h e n  w a s  t h a t  t h e  U n i v e r s a l  S e r v i c e  F u n d  p r e d i c a t e d
s u p p o r t  o n  p r o v i d i n g  v o i c e  s e r v i c e .  T h i s  m e a n t  b u n d l e d  t e l e p h o n e / b r o a d b a n d  o f f e r s  c o u l d  g e t
s u p p o r t  w h i l e  s t a n d a l o n e  b r o a d b a n d  c o u l d  n o t .  T h e  p e r v e r s e  r e s u l t  w a s  t h a t  c a r r i e r s  w e r e
i n c e n t e d  t o  t a k e  u n i v e r s a l  s e r v i c e  s u p p o r t  a n d  o f f e r  t e l e p h o n e / b r o a d b a n d  b u n d l e s  ( e v e n  i f
c o n s u m e r s  c o u l d  n o t  a f f o r d  t h e m )  w h i l e  n o t  o f f e r i n g  s t a n d a l o n e  b r o a d b a n d .  T h e  b u s i n e s s  c a s e
f o r  s t a n d - a l o n e  b r o a d b a n d  d i d n ' t  e x i s t  f o r  s o m e  r u r a l  t e l e p h o n e  c o m p a n i e s - n o t  b e c a u s e
c o n s u m e r s  d i d n ' t  w a n t  i t ,  b u t  b e c a u s e  o u r  a r c a n e  r u l e s  p e n a l i z e d  c o m p a n i e s  f o r  o f f e r i n g  i t .
I w i s h  I  c o u l d  t e l l  y o u  t h a t  t h e  F C C  h a s  f i x e d  t h i s  p r o b l e m .  B u t  a s  y o u r  l e t t e r  r i g h t l y
p o i n t s  o u t ,  w e  h a v e  n o t .  D e s p i t e  t h e  C o m m i s s i o n ' s  e f f o r t s  i n  t h e  2 0 1 6 R a t e - o f - R e t u r n  R e f o r m
O r d e r ,  I  s t i l l  h e a r  f r o m  s m a l l  c a r r i e r s  t h a t  o f f e r i n g  s t a n d - a l o n e  b r o a d b a n d  w o u l d  p u t  t h e m
u n d e r w a t e r - t h a t  t h e  r a t e s  t h e y  h a v e  t o  c h a r g e  e x c e e d  t h e  r a t e s  f o r  b u n d l e d  s e r v i c e s  b e c a u s e  o f
t h e  d i f f e r e n t  r e g u l a t o r y  t r e a t m e n t .  T h i s  i s  u n f o r t u n a t e  b u t  u n s u r p r i s i n g .  A s  I  s a i d  a t  t h e  t i m e ,  t h e
O r d e r n e e d l e s s l y  c o m p l i c a t e d  o u r  r a t e - o f - r e t u r n  s y s t e m  a n d  i n  m a n y  w a y s  m a d e  i t  h a r d e r ,  n o t
e a s i e r ,  f o r  s m a l l  p r o v i d e r s  t o  s e r v e  r u r a l  A m e r i c a .
T o  p r o v i d e  s o m e  r e l i e f ,  m y  c o l l e a g u e s  i n  r e c e n t  m o n t h s  h a v e  u r g e d  m e  t o  w o r k  t h r o u g h  a
p u n c h  l i s t  o f  l i n g e r i n g  i s s u e s  f r o m  t h e O r d e r . I  h a v e  a c c o r d i n g l y  d i r e c t e d  s t a f f  t o  w o r k  t h r o u g h
t h a t  l i s t .  I n  A p r i l ,  t h e  C o m m i s s i o n  a m e n d e d  a  r u l e  t h a t  w o u l d  h a v e  d i s a l l o w e d  c a p i t a l  e x p e n s e s
t o a n y  p r o j e c t  e x c e e d i n g  a  C o m m i s s i o n - s e t  t h r e s h o l d  b y  e v e n  a  d o l l a r ;  n o w  p r o v i d e r s  c a n
c o m p l e t e  e f f i c i e n t  p r o j e c t s  s o  l o n g  a s  t h e y  a r e  w i l l i n g  t o  a b s o r b  a n y  c o s t s  a b o v e  t h e  t h r e s h o l d .
T h a t  m o n t h  s t a f f  a l s o  r e s o l v e d  c o n c e r n s  r a i s e d  b y  r u r a l  c a r r i e r s  a b o u t  t h e  " p a r e n t - t r a p "  r u l e .  I n
M a y ,  I  c i r c u l a t e d  a n  o r d e r  t o  a d d r e s s  p r o b l e m s  w i t h  t w o  c a l c u l a t i o n s  m a d e  i n  t h e O r d e r - o n e
i n v o l v i n g  a  " s u r r o g a t e  m e t h o d "  t o  a v o i d  d u p l i c a t i v e  c o s t - r e c o v e r y  a n d  a n o t h e r  i n v o l v i n g  c h a r g e s
i m p o s e d  o n  s t a n d - a l o n e  b r o a d b a n d  l i n e s .  A l s o  i n  M a y ,  I  c i r c u l a t e d  a n  o r d e r  t o  a d d r e s s  c e r t a i n
d u p l i c a t i v e  r e p o r t i n g  r e q u i r e m e n t s  i m p o s e d  o n  r u r a l  p r o v i d e r s .  I  l o o k  f o r w a r d  t o  c o n t i n u e
w o r k i n g  w i t h  m y  c o l l e a g u e s  o n  t h e s e  i s s u e s .
P a g e  2 - T h e  H o n o r a b l e  R o n  W y d e n
A l t h o u g h  I  h o p e  t h e s e  c h a n g e s  w i l l  h e l p ,  y o u  m a y  b e  r i g h t  t h a t  s o m e t h i n g  m o r e
f u n d a m e n t a l  i s  n e e d e d .  A f t e r  a l l ,  i f  t h e O r d e r i s  n o t  c a r r y i n g  o u t  i t s  s t a t e d  p u r p o s e  o f  a d v a n c i n g
b r o a d b a n d  d e p l o y m e n t  i n  r u r a l  A m e r i c a ,  w e  c a n n o t  i g n o r e  t h a t  p r o b l e m - f o r  t i m e  i s  n o t  o n  t h e
s i d e  o f  r u r a l  A m e r i c a n s .
I  a p p r e c i a t e  y o u r  v i e w s  o n  t h i s  m a t t e r .  T h e y  w i l l  b e  i n c l u d e d  i n  t h e  r e c o r d  o f  t h i s
p r o c e e d i n g  a n d  c o n s i d e r e d  a s  p a r t  o f  t h e  C o m m i s s i o n ' s  r e v i e w .  P l e a s e  l e t  m e  k n o w  i f  I  c a n  b e
o f  a n y  f u r t h e r  a s s i s t a n c e .
S i n c e r e l y ,
A j i t V . P a i
OFFICE OF
THE CHAIRMAN
FEDERAL COMMUNICATIONS COMMISSION
WASHINGTON
June 16, 2017
The Honorable Todd Young
United States Senate
B33 Russell Senate Office Building
Washington, D.C. 20510
Dear Senator Young:
Thank you for your letter regarding the importance of delivering to all Americans-
including those in high-cost rural areas-affordable access to high-speed Internet access. As you
know, I grew up in Parsons, Kansas and have traveled during my time at the Commission to
locations as varied as Barrow, Alaska, and Diller, Nebraska, and Carthage, Mississippi. I have
seen with my own eyes what access to affordable high-speed Internet access can do for a
community-for its schools, its libraries, and its hospitals, and for those Americans struggling to
stay afloat.
Four years ago, I called on the Commission to tackle the issue of affordable broadband in
rural America head on. The problem back then was that the Universal Service Fund predicated
support on providing voice service. This meant bundled telephone/broadband offers could get
support while standalone broadband could not. The perverse result was that carriers were
incented to take universal service support and offer telephone/broadband bundles (even if
consumers could not afford them) while not offering standalone broadband. The business case
for stand-alone broadband didn't exist for some rural telephone companies-not because
consumers didn't want it, but because our arcane rules penalized companies for offering it.
I wish I could tell you that the FCC has fixed this problem. But as your letter rightly
points out, we have not. Despite the Commission's efforts in the 2016 Rate-of-Return Reform
Order, I still hear from small carriers that offering stand-alone broadband would put them
underwater-that the rates they have to charge exceed the rates for bundled services because of
the different regulatory treatment. This is unfortunate but unsurprising. As I said at the time, the
Order needlessly complicated our rate-of-return system and in many ways made it harder, not
easier, for small providers to serve rural America.
To provide some relief, my colleagues in recent months have urged me to work through a
punch list of lingering issues from the Order. I have accordingly directed staff to work through
that list. In April, the Commission amended a rule that would have disallowed capital expenses
to any project exceeding a Conmiission-set threshold by even a dollar; now providers can
complete efficient projects so long as they are willing to absorb any costs above the threshold.
That month staff also resolved concerns raised by rural carriers about the "parent-trap" rule. In
May, I circulated an order to address problems with two calculations made in the Order-one
involving a "surrogate method" to avoid duplicative cost-recovery and another involving charges
imposed on stand-alone broadband lines. Also in May, I circulated an order to address certain
duplicative reporting requirements imposed on rural providers. I look forward to continue
working with my colleagues on these issues.
Page 2-The Honorable Todd Young
Although I hope these changes will help, you may be right that something more
fundamental is needed. After all, if the Order is not carrying out its stated purpose of advancing
broadband deployment in rural America, we cannot ignore that problem-for time is not on the
side of rural Americans.
I appreciate your views on this matter. They will be included in the record of this
proceeding and considered as part of the Commission's review. Please let me know if I can be
of any further assistance.
Sincerely,
AjitV.Pai