OFFICE OF THE CHAIRMAN FEDERAL COMMUNICATIONS COMMISSION WASHINGTON July 6, 2017 The Honorable John J. Faso U.S. House of Representatives 1616 Longworth House Office Building Washington, D.C. 20515 Dear Congressman Faso: Thank you for your letter regarding the importance of delivering affordable access to high-speed Internet to all Americans-including those in high-cost rural areas. As you know, I grew up in Parsons, Kansas and during my time at the Commission have traveled to locations ranging from Barrow, Alaska to Laurens, Iowa, and Carthage, Mississippi. Through these experiences and meeting with countless Americans and carriers across the country, I have seen what access to affordable high-speed Internet access can do for a conmiunity-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, as you note in your letter, 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-an effort that would not have happened but for the resounding call to action from Congress as expressed in the letters you mention-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 exceedii-ig 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 Page 2-The Honorable John J. Faso 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. 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 iii 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. I/i Sincerely, I, (J FEDERAL COMMUNICATIONS COMMISSION WASHINGTON OFFICE OF THE CHAIRMAN July 6, 2017 The Honorable Chuck Fleischmanri U.S. House of Representatives 2410 Rayburn House Office Building Washington, D.C. 20515 Dear Congressman Fleischmann: Thank you for your letter regarding the importance of delivering affordable access to high-speed Internet to all Americans-including those in high-cost rural areas. As you know, I grew up in Parsons, Kansas and during my time at the Commission have traveled to locations ranging from Barrow, Alaska to Laurens, Iowa, and Carthage, Mississippi. Through these experiences and meeting with countless Americans and carriers across the country, I have seen 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, as you note in your letter, 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-an effort that would not have happened but for the resounding call to action from Congress as expressed in the letters you mention-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 Page 2-The Honorable Chuck Fleischmann 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. 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, JkJ1t v.i-'ai OFFICE OF THE CHAIRMAN FEDERAL COMMUNICATIONS COMMISSION WASHINGTON July 6, 2017 The Honorable Mike Gallagher U.S. House of Representatives 1007 Longworth House Office Building Washington, D.C. 20515 Dear Congressman Gallagher: Thank you for your letter regarding the importance of delivering affordable access to high-speed Internet to all Americans-including those in high-cost rural areas. As you know, I grew up in Parsons, Kansas and during my time at the Commission have traveled to locations ranging from Barrow, Alaska to Laurens, Iowa, and Carthage, Mississippi. Through these experiences and meeting with countless Americans and carriers across the country, I have seen 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, as you note in your letter, 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-an effort that would not have happened but for the resounding call to action from Congress as expressed in the letters you mention-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 Page 2-The Honorable Mike Gallagher 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. 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 July 6, 2017 The Honorable John Garamendi U.S. House of Representatives 2438 Rayburn House Office Building Washington, D.C. 20515 Dear Congressman Garamendi: Thank you for your letter regarding the importance of delivering affordable access to high-speed Internet to all Americans-including those in high-cost rural areas. As you know, I grew up in Parsons, Kansas and during my time at the Commission have traveled to locations ranging from Barrow, Alaska to Laurens, Iowa, and Carthage, Mississippi. Through these experiences and meeting with countless Americans and carriers across the country, I have seen 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, as you note in your letter, 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-an effort that would not have happened but for the resounding call to action from Congress as expressed in the letters you mention-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 Page 2-The Honorable John Garamendi 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. 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, rAJ\ OFFICE OF THE CHAIRMAN FEDERAL COMMUNICATIONS COMMISSION WASHINGTON July 6, 2017 The Honorable Louie Gohmert U.S. House of Representatives 2243 Rayburn House Office Building Washington, D.C. 20515 Dear Congressman Gohmert: Thank you for your letter regarding the importance of delivering affordable access to high-speed Internet to all Americans-including those in high-cost rural areas. As you know, I grew up in Parsons, Kansas and during my time at the Commission have traveled to locations ranging from Barrow, Alaska to Laurens, Iowa, and Carthage, Mississippi. Through these experiences and meeting with countless Americans and carriers across the country, I have seen 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, as you note in your letter, 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-an effort that would not have happened but for the resounding call to action from Congress as expressed in the letters you mention-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. Tn 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 Page 2-The Honorable Louie Gohmert 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. 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 July 6, 2017 The Honorable Sam Graves U.S. House of Representatives 1135 Longworth House Office Building Washington, D.C. 20515 Dear Congressman Graves: Thank you for your letter regarding the importance of delivering affordable access to high-speed Internet to all Americans-including those in high-cost rural areas. As you know, I grew up in Parsons, Kansas and during my time at the Commission have traveled to locations ranging from Barrow, Alaska to Laurens, Iowa, and Carthage, Mississippi. Through these experiences and meeting with countless Americans and carriers across the country, I have seen 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, as you note in your letter, 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-an effort that would not have happened but for the resounding call to action from Congress as expressed in the letters you mention-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 Page 2-The Honorable Sam Graves 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. 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. Pal OFFICE OF THE CHAIRMAN FEDERAL COMMUNICATIONS COMMISSION WASHINGTON July 6, 2017 The Honorable Morgan Griffith U.S. House of Representatives 2202 Rayburn House Office Building Washington, D.C. 20515 Dear Congressman Griffith: Thank you for your letter regarding the importance of delivering affordable access to high-speed Internet to all Americans-including those in high-cost rural areas. As you know, I grew up in Parsons, Kansas and during my time at the Commission have traveled to locations ranging from Barrow, Alaska to Laurens, Iowa, and Carthage, Mississippi. Through these experiences and meeting with countless Americans and carriers across the country, I have seen what access to affordable high-speed Internet access can do for a conirnunity-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, as you note in your letter, 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-an effort that would not have happened but for the resounding call to action from Congress as expressed in the letters you mention-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 Page 2-The Honorable Morgan Griffith 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. 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. Pa! MISS\ OFFICE OF THE CHAIRMAN FEDERAL COMMUNICATIONS COMMISSION WASHINGTON July 6, 2017 The Honorable Brett Guthrie U.S. House of Representatives 2434 Rayburn House Office Building Washington, D.C. 20515 Dear Congressman Guthrie: Thank you for your letter regarding the importance of delivering affordable access to high-speed Internet to all Americans-including those in high-cost rural areas. As you know, I grew up in Parsons, Kansas and during my time at the Commission have traveled to locations ranging from Barrow, Alaska to Laurens, Iowa, and Carthage, Mississippi. Through these experiences and meeting with countless Americans and carriers across the country, I have seen 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, as you note in your letter, 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-an effort that would not have happened but for the resounding call to action from Congress as expressed in the letters you mention-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 Page 2-The Honorable Brett Guthrie 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. 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, A+T D L.Jl1 V. 1-al OFFICE OF THE CHAIRMAN FEDERAL COMMUNICATIONS CoMMissioN WASHINGTON July 6, 2017 The Honorable Gregg Harper U.S. House of Representatives 2227 Rayburn House Office Building Washington, D.C. 20515 Dear Congressman Harper: Thank you for your letter regarding the importance of delivering affordable access to high-speed Internet to all Americans-including those in high-cost rural areas. As you know, I grew up in Parsons, Kansas and during my time at the Commission have traveled to locations ranging from Barrow, Alaska to Laurens, Iowa, and Carthage, Mississippi. Through these experiences arid meeting with countless Americans and carriers across the country, I have seen 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, as you note in your letter, 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-an effort that would not have happened but for the resounding call to action from Congress as expressed in the letters you mention-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 Page 2-The Honorable Gregg Harper 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. 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 FEDERAL COMMUNICATIONS COMMISSION WASHINGTON OFFICE OF THE CHAIRMAN July 6, 2017 The Honorable Vicky Hartzler U.S. House of Representatives 2235 Rayburn House Office Building Washington, D.C. 20515 Dear Congresswoman Hartzler: Thank you for your letter regarding the importance of delivering affordable access to high-speed Internet to all Americans-including those in high-cost rural areas. As you know, I grew up in Parsons, Kansas and during my time at the Commission have traveled to locations ranging from Barrow, Alaska to Laurens, Iowa, and Carthage, Mississippi. Through these experiences and meeting with countless Americans and carriers across the country, I have seen 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, as you note in your letter, 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-an effort that would not have happened but for the resounding call to action from Congress as expressed in the letters you mention-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 Page 2-The Honorable Vicky Hartzler 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. 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. 1 x OFFICE OF THE CHAIRMAN FEDERAL COMMUNICATIONS COMMISSION WASHINGTON July 6, 2017 The Honorable Jaime Herrera Beutler U.S. House of Representatives 1107 Longworth House Office Building Washington, D.C. 20515 Dear Congresswoman Herrera Beutler: Thank you for your letter regarding the importance of delivering affordable access to high-speed Internet to all Americans-including those in high-cost rural areas. As you know, I grew up in Parsons, Kansas and during my time at the Commission have traveled to locations ranging from Barrow, Alaska to Laurens, Iowa, and Carthage, Mississippi. Through these experiences and meeting with countless Americans and carriers across the country, I have seen 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, as you note in your letter, 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-an effort that would not have happened but for the resounding call to action from Congress as expressed in the letters you mention-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 Page 2-The Honorable Jaime Herrera Beutler 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. 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, AjitV. Pai OFFICE OF THE CHAIRMAN FEDERAL COMMUNICATIONS COMMISSION WASHINGTON July 6, 2017 The Honorable French Hill U.S. House of Representatives 1229 Longworth House Office Building Washington, D.C. 20515 Dear Congressman Hill: Thank you for your letter regarding the importance of delivering affordable access to high-speed Internet to all Americans-including those in high-cost rural areas. As you know, I grew up in Parsons, Kansas and during my time at the Commission have traveled to locations ranging from Barrow, Alaska to Laurens, Iowa, and Carthage, Mississippi. Through these experiences and meeting with countless Americans and carriers across the country, I have seen 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, as you note in your letter, 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-an effort that would not have happened but for the resounding call to action from Congress as expressed in the letters you mention-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 Page 2-The Honorable French Hill 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. 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 July 6, 2017 The Honorable Jared Huffman U.S. House of Representatives 1406 Longworth House Office Building Washington, D.C. 20515 Dear Congressman Huffman: Thank you for your letter regarding the importance of delivering affordable access to high-speed Internet to all Americans-including those in high-cost rural areas. As you know, I grew up in Parsons, Kansas and during my time at the Commission have traveled to locations ranging from Barrow, Alaska to Laurens, Iowa, and Carthage, Mississippi. Through these experiences and meeting with countless Americans and carriers across the country, I have seen 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, as you note in your letter, 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-an effort that would not have happened but for the resounding call to action from Congress as expressed in the letters you mention-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 Page 2-The Honorable Jared Huffman 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. 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, A Ajit V. Pai OFFICE OF THE CHAIRMAN FEDERAL COMMUNICATIONS COMMISSION WASHINGTON July 6,2017 The Honorable Will Hurd U.S. House of Representatives 317 Cannon House Office Building Washington, D.C. 20515 Dear Congressman Hurd: Thank you for your letter regarding the importance of delivering affordable access to high-speed Internet to all Americans-including those in high-cost rural areas. As you know, I grew up in Parsons, Kansas and during my time at the Commission have traveled to locations ranging from Barrow, Alaska to Laurens, Iowa, and Carthage, Mississippi. Through these experiences and meeting with countless Americans and carriers across the country, I have seen 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, as you note in your letter, 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-an effort that would not have happened but for the resounding call to action from Congress as expressed in the letters you mention-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 Page 2-The Honorable Will Hurd 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. 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, 1 OFFICE OF THE CHAIRMAN FEDERAL COMMUNICATIONS COMMISSION WASHINGTON July 6, 2017 The Honorable Evan Jenkins U.S. House of Representatives 1609 Longworth House Office Building Washington, D.C. 20515 Dear Congressman Jenkins: Thank you for your letter regarding the importance of delivering affordable access to high-speed Internet to all Americans-including those in high-cost rural areas. As you know, I grew up in Parsons, Kansas and during my time at the Commission have traveled to locations ranging from Barrow, Alaska to Laurens, Iowa, and Carthage, Mississippi. Through these experiences and meeting with countless Americans and carriers across the country, I have seen 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, as you note in your letter, 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-an effort that would not have happened but for the resounding call to action from Congress as expressed in the letters you mention-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 Page 2-The Honorable Evan Jenkins 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. 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 c4A OFFICE OF THE CHAIRMAN FEDERAL COMMUNICATIONS COMMISSION WASHINGTON July 6, 2017 The Honorable Lynn Jenkins U.S. House of Representatives 1526 Longworth House Office Building Washington, D.C. 20515 Dear Congresswoman Jenkins: Thank you for your letter regarding the importance of delivering affordable access to high-speed Internet to all Americans-including those in high-cost rural areas. As you know, I grew up in Parsons, Kansas and during my time at the Commission have traveled to locations ranging from Barrow, Alaska to Laurens, Iowa, and Carthage, Mississippi. Through these experiences and meeting with countless Americans and carriers across the country, I have seen 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, as you note in your letter, 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-an effort that would not have happened but for the resounding call to action from Congress as expressed in the letters you mention-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 Page 2-The Honorable Lynn Jenkins 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. 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 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 l y 6 , 2 0 1 7 T h e H o n o r a b l e B i l l J o h n s o n U . S . H o u s e o f R e p r e s e n t a t i v e s 1 7 1 0 L o n g w o r t h H o u s 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 5 D e a r C o n g r e s s m a n J o h n s o 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 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 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 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 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 h a v e t r a v e l e d t o l o c a t i o n s r a n g i n g f r o m B a r r o w , A l a s k a t o L a u r e n s , I o w a , a n d C a r t h a g e , M i s s i s s i p p i . T h r o u g h t h e s e e x p e r i e n c e s a n d m e e t i n g w i t h c o u n t l e s s A m e r i c a n s a n d c a r r i e r s a c r o s s t h e c o u n t r y , I h a v e s e e n 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 , a s y o u n o t e i n y o u r l e t t e r , 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 - a n e f f o r t t h a t w o u l d n o t h a v e h a p p e n e d b u t f o r t h e r e s o u n d i n g c a l l t o a c t i o n f r o m C o n g r e s s a s e x p r e s s e d i n t h e l e t t e r s y o u m e n t i o n - 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 Page 2-The Honorable Bill Johnson 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. 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 July 6,2017 The Honorable Walter B. Jones U.S. House of Representatives 2333 Rayburn House Office Building Washington, D.C. 20515 Dear Congressman Jones: Thank you for your letter regarding the importance of delivering affordable access to high-speed Internet to all Americans-including those in high-cost rural areas. As you know, I grew up in Parsons, Kansas and during my time at the Commission have traveled to locations ranging from Barrow, Alaska to Laurens, Iowa, and Carthage, Mississippi. Through these experiences and meeting with countless Americans and carriers across the country, I have seen 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, as you note in your letter, 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-an effort that would not have happened but for the resounding call to action from Congress as expressed in the letters you mention-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 Page 2-The Honorable Walter B. Jones 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. Although 1 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 July 6, 2017 The Honorable Ruben Kihuen U.S. House of Representatives 313 Cannon House Office Building Washington, D.C. 20515 Dear Congressman Kihuen: Thank you for your letter regarding the importance of delivering affordable access to high-speed Internet to all Americans-including those in high-cost rural areas. As you know, I grew up in Parsons, Kansas and during my time at the Commission have traveled to locations ranging from Barrow, Alaska to Laurens, Iowa, and Carthage, Mississippi. Through these experiences and meeting with countless Americans and carriers across the country, I have seen 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, as you note in your letter, 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-an effort that would not have happened but for the resounding call to action from Congress as expressed in the letters you mention-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 Page 2-The Honorable Ruben Kihuen 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. 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 CHAIHMAN FEDERAL COMMUNICATIONS COMMISSION WASHINGTON July 6, 2017 The Honorable Derek Khmer U.S. House of Representatives 1520 Longworth House Office Building Washington, D.C. 20515 Dear Congressman Kilmer: Thank you for your letter regarding the importance of delivering affordable access to high-speed Internet to all Americans-including those in high-cost rural areas. As you know, I grew up in Parsons, Kansas and during my time at the Commission have traveled to locations ranging from Barrow, Alaska to Laurens, Iowa, and Carthage, Mississippi. Through these experiences and meeting with countless Americans and carriers across the country, I have seen 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, as you note in your letter, 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-an effort that would not have happened but for the resounding call to action from Congress as expressed in the letters you mention-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 Page 2-The Honorable Derek Kilmer 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. 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, 'I' Ajit V. Pai FEDERAL COMMUNICATIONS COMMISSION WASHINGTON OFFICE OF THE CHAIRMAN July 6,2017 The Honorable Ron Kind U.S. House of Representatives 1502 Longworth House Office Building Washington, D.C. 20515 Dear Congressman Kind: Thank you for your letter regarding the importance of delivering affordable access to high-speed Internet to all Americans-including those in high-cost rural areas. As you know, I grew up in Parsons, Kansas and during my time at the Commission have traveled to locations ranging from Barrow, Alaska to Laurens, Iowa, and Carthage, Mississippi. Through these experiences and meeting with countless Americans and carriers across the country, I have seen 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, as you note in your letter, 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-an effort that would not have happened but for the resounding call to action from Congress as expressed in the letters you mention-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 Page 2-The Honorable Ron Kind 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. 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 July 6, 2017 The Honorable Steve King U.S. House of Representatives 2210 Rayburn House Office Building Washington, D.C. 20515 Dear Congressman King: Thank you for your letter regarding the importance of delivering affordable access to high-speed Internet to all Americans-including those in high-cost rural areas. As you know, I grew up in Parsons, Kansas and during my time at the Commission have traveled to locations ranging from Barrow, Alaska to Laurens, Iowa, and Carthage, Mississippi. Through these experiences and meeting with countless Americans and carriers across the country, I have seen 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, as you note in your letter, 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-an effort that would not have happened but for the resounding call to action from Congress as expressed in the letters you mention-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 Page 2-The Honorable Steve King 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. 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 July 6, 2017 The Honorable Adam Kinzinger U.S. House of Representatives 2245 Rayburn House Office Building Washington, D.C. 20515 Dear Congressman Kinzinger: Thank you for your letter regarding the importance of delivering affordable access to high-speed Internet to all Americans-including those in high-cost rural areas. As you know, I grew up in Parsons, Kansas and during my time at the Commission have traveled to locations ranging from Barrow, Alaska to Laurens, Iowa, and Carthage, Mississippi. Through these experiences and meeting with countless Americans and carriers across the country, I have seen 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, as you note in your letter, 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-an effort that would not have happened but for the resounding call to action from Congress as expressed in the letters you mention-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 Page 2-The Honorable Adam Kinzinger 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. 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 July 6, 2017 The Honorable Ann McLane Kuster U.S. House of Representatives 137 Cannon House Office Building Washington, D.C. 20515 Dear Congressman Kuster: Thank you for your letter regarding the importance of delivering affordable access to high-speed Internet to all Americans-including those in high-cost rural areas. As you know, I grew up in Parsons, Kansas and during my time at the Commission have traveled to locations ranging from Barrow, Alaska to Laurens, Iowa, and Carthage, Mississippi. Through these experiences and meeting with countless Americans and carriers across the country, I have seen 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, as you note in your letter, 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-an effort that would not have happened but for the resounding call to action from Congress as expressed in the letters you mention-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 Page 2-The Honorable Ann McLane Kuster 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. 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, AA AjitV. Pai OFFICE OF THE CHAIRMAN FEDERAL COMMUNICATIONS COMMISSION WASHINGTON July 6,2017 The Honorable Darin LaHood U.S. House of Representatives 1424 Longworth House Office Building Washington, D.C. 20515 Dear Congressman LaHood: Thank you for your letter regarding the importance of delivering affordable access to high-speed Internet to all Americans-including those in high-cost rural areas. As you know, I grew up in Parsons, Kansas and during my time at the Commission have traveled to locations ranging from Barrow, Alaska to Laurens, Iowa, and Carthage, Mississippi. Through these experiences and meeting with countless Americans and carriers across the country, I have seen 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, as you note in your letter, 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-an effort that would not have happened but for the resounding call to action from Congress as expressed in the letters you mention-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 Page 2-The Honorable Darin LaHood 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. 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. ft Sincerely, C' (J