News Update - October 2022
USDA Awards $759 Million For Broadband Under The ReConnect Program
October 27, 2022 – The U.S. Department of Agriculture (USDA) has awarded $759 million in loans and grants from the third funding round of the ReConnect Program to deploy high-speed broadband internet access services in rural areas and Tribal lands. In total, USDA is making 49 awards in the following states and territories: Alaska, Alabama, Arkansas, Arizona, California, Colorado, Georgia, Iowa, Idaho, Illinois, Kansas, Kentucky, Michigan, Minnesota, Mississippi, Missouri, North Carolina, New Mexico, Oklahoma, Oregon, South Dakota, Texas, Washington, Wyoming, Puerto Rico, Guam and Palau. Included in this are awards to the Cheyenne River Sioux Tribe, the Pawnee Nation of Oklahoma, and the utility authorities for the Navajo Nation and the Tohono O’odham Nation. A list of the award recipients and the loan and grant amounts is available here. So far in 2022, USDA has awarded $1.6 billion from the third round of the ReConnect Program.
FCC Issues Notice of Proposed Rulemaking Aimed At Strengthening Operational Readiness & Security Of Emergency Alert System
October 27, 2022 – The Federal Communications Commission has issued a Notice of Proposed Rulemaking aimed at strengthening the operational readiness and security of the Emergency Alert System (EAS) and Wireless Emergency Alerts. Comments are due on or before 30 days after the date the notice is published in the Federal Register. Reply comments are due 60 days after publication.
The EAS is a national public warning system through which broadcasters, cable systems, and other EAS Participants deliver alerts to the public to warn them of impending emergencies and dangers to life and property. The EAS distributes Presidential alerts, as well as state, local, Tribal, and territorial government alerts and National Weather Service alerts. EAS Participants are required to broadcast Presidential alerts, while state and local EAS alerts are broadcast on a voluntary basis. In the Notice of Proposed Rulemaking, the FCC proposes to:
Protect against cyberattacks by requiring Emergency Alert System participants, such as broadcasters and cable providers, to report incidents of unauthorized access to their Emergency Alert System equipment to the Commission within 72 hours. This would allow the Commission to work with participants and other government agencies to resolve an equipment compromise before it is exploited to send false alerts.
Promote security by requiring Emergency Alert System participants and the wireless providers that deliver Wireless Emergency Alerts to annually certify that they have a cybersecurity risk management plan and implement sufficient security measures for their alerting systems.
Guard against false alerts by requiring participating wireless providers to transmit sufficient authentication information to ensure that only valid alerts are displayed on consumer devices.
Seek comment on the effectiveness of the FCC’s current requirements for ensuring that Emergency Alert System equipment is ready to transmit alerts, and whether there are any alternative approaches that improve readiness.
Refresh the record on the FCC’s prior proposal to clarify that its Wireless Emergency Alert functionality requirements are not optional for wireless providers that voluntarily choose to deliver those alerts.
FCC Announces Tentative Agenda For November 17 Open Meeting
October 27, 2022 – Federal Communications Commission Chairwoman Jessica Rosenworcel has announced the following tentative agenda for the next FCC open meeting scheduled for Thursday, November 17, 2022:
Improving 911 Reliability – The Commission will consider a Report and Order to promote public safety by ensuring that 911 call centers receive timely and useful notifications of disruptions to 911 service. (PS Docket Nos. 13-75, 15-80; ET Docket No. 04-35)
Updating Resources Used to Determine Local TV Markets – The Commission will consider a Report and Order that would update its rules to use the most up-to-date market information for determining a television station’s local market for carriage purposes. (MB Docket No. 22-239)
Enforcement Bureau Action – The Commission will consider an enforcement action.
Mergers & Acquisitions: American Broadband Acquiring Moundville Telephone & MTC Long Distance In Alabama
October 26, 2022 – The FCC’s Wireline Competition Bureau is seeking public comment on a Section 214 application filed by Richard Scott Taylor, Moundville Telephone Company, Inc., MTC Long Distance, Inc., and ABAC Alabama Inc., requesting consent to transfer control of Moundville Telephone and MTC Long Distance to ABAC. Comments are due on or before November 9, 2022. Reply comments are due November 16, 2022.
Richard Scott Taylor owns direct majority (82%) voting and equity interest in Moundville Communications, Inc. which wholly-owns both Moundville Telephone and MTC Long Distance. Moundville Telephone, an eligible telecommunications carrier in Alabama, provides service as a rural incumbent local exchange carrier (LEC) to approximately 665 voice access lines and 465 broadband lines in Hale and Tuscaloosa counties in Alabama. MTC Long Distance provides toll resale service to certain of Moundville Telephone’s residential and business customers.
ABAC is a Delaware holding company that does not directly provide telecommunications services, and is directly wholly-owned and controlled by American Broadband Holding Company. American Broadband is the indirect parent company of multiple incumbent LECs, competitive LECs, and a wireless provider primarily serving rural markets in Alaska, Louisiana, Missouri, Nebraska, and Texas. American Broadband is ultimately indirectly controlled by a private equity investment firm, Madison Dearborn Partners, LLC, a Delaware limited liability company.
Pursuant to the terms of the proposed transaction, ABAC will purchase all the issued and outstanding stock of Moundville Communications, making Moundville Communications a direct, wholly-owned subsidiary of ABAC, which results in Moundville Telephone and MTC LD becoming indirect wholly-owned subsidiaries of ABAC. Because of the complexity of the proposed transaction, the Bureau has accepted the application for non-streamlined processing.
NTIA Releases BEAD Workforce Planning Guide
October 19, 2022 – The National Telecommunications and Information Administration (NTIA) has released a Workforce Planning Guide for the Broadband Equity, Access, and Deployment (BEAD) program. The Workforce Planning Guide is intended to help Eligible Entities “in developing their workforces for grant implementation as well as designing workforce plans and standards for subgrantees.” The guide consists of the following sections: Components of a Workforce Plan for the BEAD Program; Developing a BEAD Workforce Plan guidance, including proposed planning steps and pacing suggestions for completing BEAD submissions and key integration points with the Digital Equity Program; Strategies and Examples that offer a range of approaches for meeting workforce requirements; and Additional Resources to support the workforce planning and implementation process.
AT&T Illinois To Pay $23 Million Criminal Penalty For Bribery Directed At Speaker Of The Illinois House Of Representatives In 2017
October 14, 2022 – The U.S. Attorney for the Northern District of Illinois and Illinois Bell Telephone Company, LLC d/b/a AT&T Illinois have entered into a Deferred Prosecution Agreement, resolving “a federal criminal investigation into alleged misconduct involving the company’s efforts to unlawfully influence former Illinois Speaker of the House Michael J. Madigan.”
As explained in the agreement, AT&T Illinois funneled $22,500 to a political ally of the Speaker of the Illinois House of Representatives for help passing legislation eliminating carrier of last resort obligations. The payments were for “special project” consulting work that never occurred. Consequently, AT&T Illinois will pay a $23 million criminal penalty, and must implement a new ethics program and provide annual reports to the government regarding remediation and implementation of the program.
In connection with the case, the former president of AT&T Illinois, Paul La Schiazza, was “charged with one count of conspiracy, one count of corruptly giving something of value to reward a public official, and three counts of using a facility in interstate commerce to promote unlawful activity.”
FCC Items On Circulation
October 14, 2022 – The following is a current list of Federal Communications Commission Items On Circulation, which are Commission level items that are pending action by the full FCC:
Rural Digital Opportunity Fund: FCC Authorizes RDOF Support For 1,865 Winning Bids (14th RDOF Authorization); Starry Defaults On All RDOF Winning Bids
October 12, 2022 – The FCC’s Wireline Competition Bureau has authorized Rural Digital Opportunity Fund (RDOF) Phase I auction support for 1,865 winning bids. This is the fourteenth Public Notice authorizing RDOF support. Attachment A to the Bureau’s Public Notice contains a list of the authorized winning bids, which belong to the following three entities: AMG Technology Investment Group, LLC (d/b/a Nextlink Internet) (Illinois, Indiana, Iowa, Kansas, Louisiana, Minnesota, Nebraska, Oklahoma, Texas, Wisconsin, and Wyoming); Northern Arapaho Tribal Industries (Wyoming); and Safelink Internet LLC (Nevada).
Attachment B to the Bureau’s Public Notice contains a list of winning bids associated with winning bidders or their assignees that have notified the Bureau that they do not intend to pursue all or some of their winning bids in a state. They belong to the following three entities: Cal.net, Inc. (California); California Internet, L.P. dba GeoLinks (California); and Connect Everyone LLC (Starry) (Alabama, Arizona, Colorado, Illinois, Mississippi, Nevada, Ohio, Pennsylvania, and Virginia).
The 1,856 winning bid authorizations were granted after the Bureau reviewed long-form application information for each authorized winning bidder, including letters of credit and Bankruptcy Code opinion letters, and concluded the submissions were acceptable. Consequently, the Bureau has directed and authorized the Universal Service Administrative Company to obligate and disburse Universal Service Fund support to each winning bidder. Support will be disbursed in 120 monthly payments, beginning at the end of October 2022. The first service obligation that must be met by the RDOF support recipients authorized by the Public Notice is the deployment of broadband service to 40% of locations in a state by December 31, 2025. The broadband service must meet the standards for which support was received (i.e., speed levels and latency). After that, these RDOF support recipients must achieve the following broadband service deployment obligations: 60% of locations in a state by December 31, 2026; 80% of locations in a state by December 31, 2027; and 100% of locations in a state by December 31, 2028.
FCC Chairwoman Responds To Congressional Inquiry On Limits Of FCC Power
October 7, 2022 – FCC Chairwoman Jessica Rosenworcel has sent a letter responding to an inquiry by Representative Cathy McMorris Rodgers (R-WA), Ranking Member of the U.S. House of Representatives’ Committee on Energy and Commerce, on the FCC’s authority. Representative McMorris Rodgers’ inquiry was sent “to underscore the implications of” the Supreme Court’s decision in West Virginia v. EPA “and to remind [the FCC] of the limitations on [its] authority.” In West Virginia v. EPA, the Supreme Court invalidated action taken by the Environmental Protection Agency pursuant to the Clean Air Act. The Court invoked the major questions doctrine – a federal agency must point to “clear congressional authorization” for the authority it claims. According to Representative McMorris Rodgers, “in recent years, the FCC has taken it upon itself to misinterpret its authority to initiate rulemakings with ‘economic and political significance’ that fit the Chair’s political leanings.” The purpose of Representative McMorris Rodgers’s inquiry is to ensure this is not currently happening at the FCC. In response, Chairwoman Rosenworcel’s letter provides the following information:
A list of all pending FCC rulemakings and the specific Congressional authority for each rulemaking;
A list of all expected FCC rulemakings and the specific Congressional authority for each rulemaking; and
A list of all pending or expected FCC Declaratory Rulings on delegated authority by a Bureau or Office of the FCC.
FCC Releases Tentative Agenda For October 27th Open Meeting
October 6, 2022 – Federal Communications Commission Chairwoman Jessica Rosenworcel has announced the following tentative agenda for the FCC’s next open meeting scheduled for Thursday, October 27, 2022:
Uniendo a Puerto Rico Fund and the Connect USVI Fund – The Commission will consider a Further Notice of Proposed Rulemaking that would ensure continued support for mobile carriers and extend the support phase down for incumbent fixed broadband providers in Puerto Rico and the U.S. Virgin Islands to enhance their networks’ reliability and resiliency in the face of hurricanes and other natural disasters. (WC Docket Nos. 18-143, 10-90)
Considering 12.7 GHz Band for Next-Generation Wireless Services – The Commission will consider a Notice of Inquiry to seek information on the current use of the 12.7-13.25 GHz band, ways to encourage more efficient and intensive use of the band, and whether the band is suitable for mobile broadband or other expanded use. The Commission will also consider an Order to extend the temporary freeze on applications in the 12.7 GHz band. (GN Docket No. 22-352)
Caller ID Authentication on Non-IP Networks – The Commission will consider a Notice of Inquiry launching a broad inquiry on caller ID authentication technology for non-Internet Protocol networks. (WC Docket No. 17- 97)
Improving the Security of the National Alert and Warning Systems – The Commission will consider a Notice of Proposed Rulemaking to strengthen the operational readiness of the Emergency Alert System and Wireless Emergency Alerts, including by reducing the vulnerability of these systems to cyberattacks. (PS Docket Nos. 15-94, 15-91, 22-329)
Restricted Adjudicatory Matter – The Commission will consider a restricted adjudicatory matter.
NTIA Receives Over 235 Applications Requesting Over $5.5 Billion In Funding From Enabling Middle Mile Infrastructure Grant Program
October 4, 2022 – The National Telecommunications and Information Administration (NTIA) has announced that preliminary data indicates over 235 applications, requesting more than $5.5 billion in funding, were submitted for the Enabling Middle Mile Infrastructure Grant Program. The Middle Mile Grant Program will provide up to $1 billion in grant funding for the construction, improvement, or acquisition of middle mile infrastructure. The program’s application window opened on June 21, 2022, and closed on September 30, 2022. NTIA will evaluate the applications and make awards on a rolling basis no earlier than March 2023.
Mergers & Acquisitions: GI DI Iris Acquiring Rise Broadband Fixed Wireless Providers Skybeam, AirCanopy & Essex Telcom
October 4, 2022 – The FCC’s Wireline Competition Bureau is seeking public comment on a Section 214 application filed by JAB Wireless, Inc., Skybeam, LLC, AirCanopy Internet Services, Inc., and Essex Telcom, Inc., and GI DI Iris Acquisition Inc., requesting approval for the transfer of control of Skybeam, AirCanopy, and Essex Telcom (Domestic 214 Authorization Holders) to GI DI Iris Acquisition.
Pursuant to a May 2022 Agreement and Plan of Merger, JAB Wireless will be a direct, wholly-owned subsidiary of GI DI Iris Acquisition Inc., and Skybeam, AirCanopy, and Essex Telcom and their affiliates will be indirect, wholly-owned subsidiaries of GI DI Iris Acquisition Inc. After consummation, JAB Wireless and Skybeam, AirCanopy, and Essex Telcom “will continue to exist and operate under the same names, and will continue to provide service pursuant to then-existing rates, terms, and conditions for the near term.”
JAB Wireless, a Colorado corporation, does not itself provide telecommunications services. JAB directly, wholly-owns Skybeam. AirCanopy, and Essex Telcom are direct, wholly-owned subsidiaries of Skybeam.
Skybeam is a Colorado limited liability company; AirCanopy is a Texas corporation; and Essex Telcom is an Illinois corporation. They collectively provide fixed wireless broadband services under the trade name “Rise Broadband” in 16 states: Texas, Oklahoma, Missouri, Illinois, Indiana, Nebraska, Iowa, Kansas, Colorado, Wyoming, Idaho, Nevada, Utah, Minnesota, Wisconsin, and South Dakota. Skybeam has been designated as an eligible telecommunications carrier (ETC) in Iowa, Kansas, Nebraska, and Texas, and currently receives support through the FCC’s Rural Broadband Experiment (RBE) program but no other high-cost Universal Service Fund programs. Essex Telcom has been designated as an ETC in Illinois.
GI DI Iris Acquisition is a newly formed company created for the purpose of completing the transaction. GI DI Iris Acquisition is primarily owned and is controlled by private equity funds GI Data Infrastructure Fund LP and GI Data Infrastructure Fund-A LP.
Proposed Bill Would Remove Broadband Grants From Taxable Gross Income
October 1, 2022 – Senators Mark Warner (D-VA) and Jerry Moran (R-KS) have introduced the Broadband Grant Tax Treatment Act (S. 5021) in the U.S. Senate. If passed, the bill would amend the Internal Revenue Code to exclude certain broadband grants from taxable gross income. Senators Tim Kaine (D-VA), Roger Wicker (R-MS), Raphael Warnock (D-GA), and Shelley Moore Capito (R-WV) have joined as co-sponsors. The Broadband Grant Tax Treatment Act has been referred to the Senate Committee on Finance.
