February 8, 1999
| Re: | Declaratory Ruling Regarding the Iowa Communications Network in Federal-State Joint Board on Universal Service, CC Docket 96-45. |
I dissent from today's decision finding that the Iowa Communications Network is ineligible for receiving direct universal service support for the provision of discounted telecommunications services to schools, libraries, and rural health care providers under sections 254(h)(1)(A) and (B). I cannot support such a strict interpretation of our rules that disadvantages state-based networks while the Commission continues to allow non-carriers, such as large computer companies, to receive money for providing other services under Section 254. I believe that such state telecommunications networks are closer to the kinds of eligible receivers that Congress had envisioned than many of the numerous beneficiaries of the fund today.
The history of the Commission's interpretation of Section 254 is not a happy one. For almost two years, the Commission has established programs and promulgated rules under the guise of Section 254. But these programs and rules, while perhaps engendered with noble intent, have not met the exacting requirements of Section 254. Indeed, many of these programs and rules are clearly outside of Section 254, and clearly outside of Commission authority. I have noted just a few of these many peculiar circumstances in several statements over the past year.(1)
Many parties come before the Commission with disputes about how best to interpret for specific circumstances Commission rules under Section 254. Iowa has presented the Commission with an issue that, at least on the surface, seems have substantial merit: that it would be inequitable to disallow Iowa's schools and libraries from receiving universal service support for telecommunications services just because those services are being provided by a state telecommunications network.
The majority's responds that "The Act explicitly provides that only 'telecommunications carriers' are eligible for direct reimbursement pursuant to 254(h)(1)(B) and for universal service support pursuant to section 254(h)(1)(A)."(2) Usually I would applaud such a straightforward reading of the statute's requirements. But these are the same requirements that have been ignored by this Commission on repeated occasions.
For example, the Commission acknowledges that Section 254(e)'s requirement that only "eligible telecommunications carriers" receive universal service support applies to Section 254(h) generally.(3) Indeed, it limits the recipients of support for providing telecommunications service to rural health care providers under section 254(h)(1)(A) to those eligible carriers under 254(e). But then that provision should also apply to the other provisions of 254(h), at least unless specifically excepted. Thus, Section 254(h)(1)(B), which expressly permits recipients to be "telecommunications carriers," is more specific than 254(e) and could take precedence. But the provisions of section 254(e) -- which require that only eligible telecommunications carriers be able to receive federal universal service support -- apply fully to section 254(h)(2). Thus, the requirements for being able to receive funds in conjunction with section 254(h)(2) are actually stricter -- a recipient would have to be designated an eligible telecommunications carrier. But the Commission has ignored this restriction.
As one can see, to form an opinion about this issue, one must suspend disbelief in the legality of the underlying programs and rules. That is, how does one best interpret a statute for a particular circumstance under a rule that appears to be inconsistent with the statute? If I were able to suspend disbelief, I would applaud the strict statutory construction: only telecommunications carriers, which must be common carriers, appear to be eligible to receive discounts under Section 254(h)(1)(B). The unfortunate result under this program, however, is that states that had been more forward-looking than most and that had invested substantial resources into developing education networks are disadvantaged. And, more importantly, it is only now in this circumstance that we are applying the actual requirements of Section 254.
I, for one, believe that these state educational networks, are closer to being eligible telecommunications carriers than many of those receiving universal service support today. Moreover, they are at least as close as the computer companies that are receiving support. Thus, I do not agree with the majority that "state programs such as Iowa's are incompatible with the federal program."(4) Indeed, I find it ironic that it is only now that some advocate a strict interpretation of Section 254.
Finally, I note that several Congressional leaders have called on the FCC to reconsider its universal service programs and to start anew in a manner consistent with Section 254. Any such renewed effort on universals should consider block grants to States and thereby allow State rather than federal officials, to make final determinations about the assignment of universal service funds. Such a system would remove FCC Commissioners from having to repeat the awkward process -- not only of assigning funds among many competing private companies -- but of resolving disputes in those assignments brought by State governments and their agencies. Such a system would also allow states to provide support to the forward-looking educational efforts that they have put in place.
1. See Dissenting Statement of Commissioner Harold Furchtgott-Roth Regarding Federal State Joint Board on Universal Service, CC Docket 96-45, Third Order on Reconsideration, 12 FCC Rcd 22801 (1997); Statement of Commissioner Harold Furchtgott-Roth Regarding the Second Quarter 1998 Universal Service Contribution Factors, rel. March 20, 1998; Dissenting Statement of Commissioner Harold Furchtgott-Roth Regarding the Federal-State Joint Board Report to Congress, rel. April 10, 1998; Dissenting Statement of Commissioner Harold Furchtgott-Roth Regarding the Report to Congress in Response to Senate Bill 1768 and Conference Report on H.R. 3579, rel. May 8,1998; Statement of Commissioner Harold Furchtgott-Roth Regarding the Common Carrier Bureau's Proposed Revisions of 1998 Collection Amounts For Schools and Libraries and Rural Health Care Universal Service Support Mechanisms, rel. May 13, 1998; Statement of Commissioner Harold Furchtgott-Roth Regarding the Common Carrier Bureau's Clarification of "Services" Eligible for Discounts to Schools and Libraries, rel. June 11, 1998; Statement of Commissioner Harold Furchtgott-Roth Regarding the Common Carrier Bureau's Third Quarter 1998 Universal Service Contribution Factors, rel. June 12, 1998; Dissenting Statement of Commissioner Harold Furchtgott-Roth Regarding Federal State Joint Board on Universal Service, Fifth Order on Reconsideration and Fourth Report and Order Regarding the Federal-State Joint Board on Universal Service, rel. June 17, 1998.
2. Declaratory Ruling at par. 27.
3. Declaratory Ruling at par. 5.
4. Declaratory Ruling at par. 27.