Unlike most monthly Commission meetings, none of the items on the October agenda initiate new proceedings or propose new rules. Instead, the items focus on implementation of a number of policies prioritized under Chairman Pai. FCC regulatory activity will likely slow in the aftermath of the election. As a result, the October agenda may represent the FCC’s final push for any major reforms in the near-term. However, on October 15, Chairman Pai did announce his intention to move forward with a rulemaking to interpret the meaning of Section 230 of the Communications Decency Act. You will find more details on the significant October meeting items after the break:
Restoring Internet Freedom Order Remand: The draft Order on Remand would respond to the remand from the D.C. Circuit in Mozilla Corp v. FCC, which upheld a majority of the FCC’s decisions on broadband Internet access service regulation and classification in the 2017 Restoring Internet Freedom Order, but remanded three issues back to the agency for further consideration. The FCC would address each issue and find that its initial conclusions in the 2017 order promote public safety communications, facilitate broadband infrastructure deployment through pole attachment rights, and allow the Commission to continue to provide Lifeline support conditioned on providing broadband internet access service. The agency would find there is no basis for departing from these original conclusions and that any negative effects on these sectors resulting from its classification of broadband Internet access service in the 2017 order would be limited or otherwise outweighed by the benefits of the “light-touch” regulatory framework for broadband.
Establishing a 5G Fund for Rural America: The draft Report and Order would adopt the 5G Fund using a two-phase reverse auction targeting support for deploying 5G networks in areas without an unsubsidized provider of either 4G LTE or 5G mobile broadband. Proposed in an April 2020 Notice of Proposed Rulemaking (“NPRM”), the draft Order would adopt a 10-year term of support and an overall budget of $9 billion for the 5G Fund. Phase I of the auction would make available up to $8 billion, with $680 million set aside for bidders offering to serve Tribal lands, and Phase II would make at least $1 billion available to target deployment facilitating adoption of precision agriculture technologies. The FCC would adopt its proposal to determine which areas would be eligible for 5G Fund support from data collected through the upcoming Digital Opportunity Data Collection, and would impose performance requirements on carriers continuing to receive legacy mobile high-cost support.
Unlicensed Wireless Opportunities in TV White Spaces: The draft Report and Order would adopt changes to the Part 15 unlicensed device rules, as proposed in the Commission’s February 2020 NPRM, to expand the ability of white spaces devices to deliver wireless broadband services in rural areas. The Order would increase the maximum permissible power for fixed white space devices operating on TV channels 2-35 in “less congested areas” and allow higher-power mobile operations within defined geographic areas. The FCC would also adopt rule changes to facilitate the development of narrowband Internet of Things devices and services in the TV bands.
Streamlining Approval of Wireless Infrastructure Modifications: The draft Report and Order would revise the Commission’s section 6409(a) rules to provide for streamlined state and local review of tower modifications that involve limited ground excavation or deployment beyond site boundaries. The rule revision would establish that, for towers not located in the public rights-of-way, a modification of an existing site needing ground excavation or deployment of up to 30 feet will not be disqualified from streamlined processing on that basis. The draft Order would also promote accelerated deployment of 5G and other advanced wireless services by facilitating the collocation of antennas and associated equipment on existing infrastructure, while preserving the ability of state and local governments to manage and protect local land-use interests.
Modernizing Unbundling and Resale Requirements: The draft Report and Order would eliminate and modernize unbundling and resale requirements for incumbent local exchange carriers (“LECs”). The FCC would eliminate certain unbundling requirements for specific broadband-capable loops, subject to reasonable transition periods, in more densely populated areas, but preserve unbundling requirements in less densely populated areas without sufficient evidence of competition. The draft Order would also forbear from the avoided-cost resale obligation for non-price cap carrier incumbent LECs, subject to a three-year transition period.
]]>For those who have been following the FCC over the past three years under Chairman Pai’s leadership, the draft item builds on the agency’s multifaceted effort to pave a clear path for the private sector to deploy 5G technologies. Prior efforts include repurposing low-, mid-, and high-band spectrum for mobile wireless operations, reducing the circumstances under which wireless infrastructure deployments must undergo federal historic preservation and environmental reviews, and preempting states and localities from using review processes to slow the deployment of small cells.
The agency is set to vote on the item at its June 9, 2020, open meeting.
Declaratory Ruling Clarifying Local Review Rules
The draft Declaratory Ruling is meant to strengthen several of the rules the FCC adopted in 2014 to implement Section 6409(a) of the Spectrum Act of 2012. That section says that “a State or local government may not deny, and shall approve, any eligible facilities request for a modification of an existing wireless tower or base station that does not substantially change the physical dimensions of such tower or base station.” The Commission’s rules implementing the statute were meant to provide clarity and guidance to state and local governments and the wireless industry on how to apply the statutory directive. The WIA and CTIA petitions claim that certain conditions established by states and localities continue to impede the deployment of private 5G networks. Accordingly, the draft Declaratory Ruling addresses the following:
The Commission opted to issue an NPRM on one additional proposal in the WIA petition, regarding when a modification requires excavations. Existing rules provide that “[a] modification substantially changes the physical dimensions of an eligible support structure if . . . [i]t entails any excavation or deployment outside the current site” of a tower or base station, and is therefore not eligible for the streamlined procedures under the statute. Industry and localities disagree on whether “current site” means the boundaries at the time the tower was first approved or at the time the applicant seeks approval for a modification. WIA also asked the Commission to change its rules so that “a modification would not cause a “substantial change” if it entails excavation or facility deployments at locations of up to 30 feet in any direction outside the boundaries of a macro tower compound,” on the basis that colocation on existing towers is difficult to achieve without increasing the size of compounds. The NPRM seeks comment on these issues.
Democrats and Republicans Clash in Congressional Letters on Item
Democrats and Republicans on the House Energy and Commerce Committee sent competing letters to FCC Chairman Pai concerning the draft item. Democrats asked that he delay the vote on the item, saying that “under the guise of clarifying . . . existing rules, [it] would grant companies the right to expand existing cell sites without any regard to local processes” and without meaningful insight from local governments, who are currently burdened with responding to the ongoing coronavirus pandemic. Republicans urged the FCC to press forward with the vote, also evoking the coronavirus pandemic to assert that the item would reduce “unnecessary regulatory burdens,” which would further streamline deployment and facilitate connectivity that is even more critical “[d]uring these unprecedented times.”
At the FCC, the two Democratic commissioners, Rosenworcel and Starks, expressed support for delaying the vote.As of this writing, Chairman Pai and Commissioner O’Rielly have not commented on the delay request. Republican Commissioner Carr strongly supports the item and is leading the charge for its adoption. We expect the vote to proceed and the item to be approved largely unchanged.
]]>The Telecommunications Act of 1996 (the “Act”) introduced numerous regulatory provisions designed to prevent BOCs from leveraging their monopoly status to disadvantage competitor long distance providers and some requirements subsequently were applied to independent incumbent local exchange carriers. Certain provisions have automatically sunset and, over time, the FCC eliminated or forbore from enforcing many, but not all, of the requirements. USTelecom has sought forbearance from BOC obligations on several occasions including, prior to the current request, in a 2014 request that all BOCs receive forbearance from all remaining Section 272 obligations in all regions. If adopted in its current form, the draft Order would forbear from enforcing three requirements, including effectively eliminating the remaining Section 272 obligations.
First, independent RoR carriers currently are subject to structural separations requirements for their in-region long distance services. The FCC rule Section 64.1903 separate long distance affiliate requirement was designed to prevent independent RoR carriers from misallocating local and long-distance operational costs, a practice that could result in overearnings or increased rates for competitors relying on critical service inputs from the independent RoR carriers. Describing the structural separations requirement as burdensome and ineffective at preventing cost misallocation, the draft Order instead cites to regulatory and marketplace changes, and Commission enforcement mechanisms as sufficient to address cost misallocation concerns. The Commission notes the existence of “numerous accounting, cost allocation and separations requirements” that act to require separate accounting, prevent cross-subsidization of services, and prescribe cost allocation procedures. The draft Order asserts that, should these methods fail, the RoR carriers are subject to investigation and enforcement pursuant to several provisions of the Act. Finally, the draft asserts that Commission rule changes and increasing RoR carrier conversion to price cap regulation has reduced the incentive, and made it easier to identify, cost misallocation. Unlike prior Commission forbearance grants of the structural separations requirement, the draft Order does not propose special access charge imputation filing or performance metric reporting requirements on independent RoR carriers. Consistent with the Commission’s prior forbearance of the imputation condition for price cap LECs and because, as discussed below, the performance metric reporting requirements are proposed to be forborne for BOCs and price cap LECs, the Commission proposes to forbear them for RoR carriers also.
Second, the draft Order proposes to grant forbearance from the Section 272(e)(1) provisioning interval requirement and related special access performance metric reporting requirement. Although not requested by USTelecom, the Commission takes the opportunity to propose forbearance of similar provisions and reporting requirements applied to price cap LECs. Section 272(e)(1) of the Act prohibits BOCs from discriminating in the speed at which the BOC provisions telephone exchange service and exchange access to unaffiliated carriers as compared to fulfilling requests for the BOC or its own affiliates. The special access performance metric reporting was intended to assist in enforcing Section 272(e)(1)’s nondiscrimination requirement. USTelecom had sought similar forbearance in 2014 and the proposed grant marks a departure from the Commission’s 2015 order denying USTelecom’s 2014 request for forbearance from all remaining Section 272 BOC obligations (“2015 USTelecom Forbearance Order”).
Similar to the justification for the structural separations forbearance for RoR carriers, the draft Order relies on the presence of existing regulations, enforcement mechanisms, and marketplace changes as supporting the proposed forbearance. The FCC explains that Sections 201 and 202 of the Act prohibit unreasonably discriminatory behavior and Section 251(b)(1) has been interpreted as prohibiting discriminatory provisioning of services for resale. The 2015 USTelecom Forbearance Order previously asserted that Sections 201 and 202 were insufficient to protect competition. Responding to opposition references to the 2015 decision on this point, the draft Order characterizes the prior statements regarding Sections 201 and 202 as “outdated,” particularly in light of later Commission orders including the 2017 Business Data Services Order. The Commission’s Section 208 complaint process and Market Disputes Resolution process are mentioned as additional methods of preventing discriminatory provisioning. The draft Order also notes that facilities-based competition, including in the business data services market, supports elimination of the BOC and price cap LEC provisioning safeguards and renders unpersuasive commenter concerns regarding possible BOC and price cap LEC motives to discriminate. USTelecom did not seek forbearance from Sections 272(e)(2) and (4), the last remaining Section 272 provisions applicable to a BOC’s Section 272 separate affiliate. However, the draft Order suggests those provisions essentially will become irrelevant because, upon forbearance of the special access performance metric reporting requirement, there will be no reason for a BOC to continue operating a Section 272 long distance affiliate.
The draft Order’s third proposed forbearance grant would relieve BOCs of the Section 271(c)(2)(B)(iii) requirement to provide nondiscriminatory access to pole attachments in accordance with Section 224 of the Act. Like the structural separations issue, this request received little attention in proceeding comments. The FCC explains that Section 271(c)(2)(B)(iii) is typically applied as a condition for BOCs seeking to provide in-region long-distance service. Because the draft Order finds the provision to be redundant of Section 224, which remains in effect, the FCC proposes to forbear from enforcement of Section 271(c)(2)(B)(iii). The draft Order highlights that the only distinction between Section 271(c)(2)(B)(iii) and Section 224 is the former statute’s 90-day complaint period, which the Commission notes has never been used for a Section 271 pole attachment complaint. The FCC asserts there is no need to single out BOCs for “duplicative pole access regulation” in light of pole ownership competition from electric service providers and the nondiscrimination safeguards in Section 224. Commenter observations that BOCs have been using enforcement remedies to obtain pole access were considered insufficient to support retaining Section 271’s duplicative enforcement remedy.
Finally, the Commission expressly declined to rule on USTelecom’s forbearance request regarding Section 251(c) obligations applicable to UNEs and resale. This issue has garnered the most attention, including staff briefing requests from the House Commerce Committee and House Communications Subcommittee, opposition filings from many industry members, and potentially more than 8,000 letters, many individualized, from consumers. Industry members opposing UNE and resale forbearance have asserted a variety of concerns, including that the petition was procedurally deficient because it was not “complete-as-filed”, the lack of “economically viable alternatives” for certain UNEs, and USTelecom’s failure to provide granular, localized data to support assertions of market competition.
The few comments supporting USTelecom’s petition asserted the presence of facilities-based competitors and the decline in use of UNEs, particularly as consumers seek higher-speed services, and argued the Commission is not required to “undertake any particular geographic or product market analysis” when reviewing a forbearance request. In light of the significant and ardent positions on potential UNE/resale forbearance – including sustained ex parte communications, as recently as yesterday, with the Commission – it’s not surprising that the Commission has chosen to delay deciding on this issue. Rather, addressing the issue in a footnote, the FCC notes that the UNE/resale request remains pending, subject to an August 2, 2019 statutory deadline, and that the draft Order should not be “construed as prejudging” the issue. The Commission does appear to be moving on the request, however, as just last week it released a Public Notice stating that the Commission intends to incorporate into the USTelecom forbearance proceeding confidential and highly confidential information submitted in the BDS proceeding. The Public Notice notes that USTelecom “relies on the Commission’s analysis of the data submitted in the BDS proceedings for the factual basis of its forbearance request” and the Commission expects that the BDS data “will significantly enhance the Commission’s ability to analyze competitive facilities deployment.” Consequently, we expect the Commission will take up this request in a future order.
The draft Order is subject to change before being released, so be sure to check back for any updates on the final Order.
]]>Restricting Deployment Fees
The Communications Act prohibits state and local governments from adopting requirements that effectively prohibit the provision of wireless services. The FCC’s draft item finds that state and local rights-of-way fees and other charges associated with infrastructure deployment can effectively prohibit wireless services. As a result, the FCC plans to conclude that such fees are prohibited unless they are nondiscriminatory and represent a reasonable approximation of the state or local governments’ actual costs related to the deployment, such as fees designed to recover the costs of permit reviews. The FCC also anticipates providing examples of fees that it will deem reasonable in advance. However, the draft item recognizes that the actual costs incurred by state and local governments may vary significantly based on the deployment’s location and scope, and notes that particular fees will be judged for reasonableness on a case-by-case basis.
Limiting Aesthetic Obligations
The FCC indicates that many wireless broadband providers claimed that state and local governments impose burdensome design requirements and other aesthetic obligations on new facilities. In particular, providers complained that they are often subject to vague or subjective criteria that are not spelled out in any official code or policy. The FCC’s draft item asserts that aesthetic requirements for wireless broadband deployments are not necessarily unlawful, so long as the obligations are: (1) reasonable; (2) no more burdensome than those applied to other deployments; and (3) published in advance. The FCC cautions that one-size-fits-all mandates may not pass muster, such as rules requiring underground facilities deployments in all cases.
Establishing Shot Clocks
The FCC’s draft item would impose new shot clocks on small wireless broadband facilities deployments. State and local governments would have 60 days to process an application for collocation of small facilities on preexisting structures and 90 days to process an application involving new construction. These shot clocks mirror the deadlines recently recommended by the FCC’s Broadband Deployment Advisory Committee in its model code for municipalities. If a state or local government fails to abide by the shot clocks, such failure will be considered a prohibition of service and a violation of federal law, enabling affected providers to seek expedited relief in court.
Legislative Action?
The FCC is not the only level of government pushing for faster wireless broadband deployment. Congress has teed up two significant pieces of legislation aimed at facilitating wireless network rollouts. First, the STREAMLINE Small Cell Deployment Act proposes to expedite wireless infrastructure deployments by implementing a “reasonable process and timeframe guidelines” for state and local governments’ consideration of deployment requests and banning onerous conditions and fees. Second, the SPEED Act similarly would streamline federal agencies’ permitting processes for wireless infrastructure deployments. Both pieces of legislation enjoy bipartisan support and Congressional leaders indicate that they plan to move the bills to a vote in some form this year. In addition, Derek Khlopin, Senior Advisor to the Assistant Secretary of the National Telecommunications and Information Administration discussed coordinating with the FCC on access for communications deployments on federal lands at the Mobile World Congress Americas conference yesterday.
With government and commercial wireless stakeholders already heavily involved in debates over infrastructure policy, the FCC’s draft item is sure to generate significant input about the current costs of wireless network development and government control over rights-of-way and community planning. It remains to be seen whether the FCC or Congress will make the next move to reform deployments, but reform is coming and readers involved or impacted by the wireless industry should keep a close watch on these pending agency and legislative actions.
]]>Chairman Pai has said that "one of the first things" the Committee will tackle is drafting a "model code for broadband deployment," covering local franchising, zoning, permitting and rights-of-way regulations, for Commission consideration. An FCC-approved model code could help communities design more conducive regulatory environments for broadband deployment, helping improve the business case for providers to build-out in networks in areas without the resources or expertise in next-generation networks.
The creation of this Committee comes shortly after the release of the Broadband Opportunity Council Progress Report, which documents an inter-agency council's (Council) progress of completing nearly half of 36 executive actions by 25 Cabinet-level and federal agencies to increase broadband deployment, competition and adoption. Many of the actions include expanded program eligibility for broadband under various Department of Agriculture, Department of Justice, Department of Treasury, Department of Health and Human Services, National Science Foundation and Economic Development Administration funding programs. While the Council continues its efforts at the Cabinet-level, this new Committee will now have the authority to reform current FCC rules and regulations that can impede infrastructure investment. Coordination will be needed amongst the two groups to bridge the digital divide and promote investment in broadband deployment.
According to a Commission Public Notice, the Commission is now accepting nominations for membership on the Committee, which will operate according the Federal Advisory Committee Act (FACA). Under FACA, meetings shall be open to the public with timely bodice of the meetings published in the Federal Register. The Commission seeks nominations from representatives of the communications industry, state and local regulators, and consumer and community organizations that wish to be considered for membership. Specifically, the Commission seeks nominations and expressions of interest from:
These rules apply to BIA review and approval of access to ROW for electric transmission and distribution systems (including lines, poles, towers, telecommunication, protection, measurement and data acquisition equipment, other items necessary to operate and maintain the system and appurtenant facilities) as well as telecommunications, broadband, and fiber optic lines.
The most noteworthy provisions of the updated rules provide a clear process and timeline for applying for and receiving a ROW. Under the old rules, applicants never knew when to expect a response or what happened to the application once filed. Now, BIA will notify applicants once it receives an application of its completeness and any missing components. Applicants can now expect BIA to grant or deny the ROW within 60 days of receiving a completed application. Simultaneously, BIA will notify the Tribal or landowners of its intent to grant the ROW at least 60 days prior to the grant, giving the Tribal or landowners 30 days to object to the grant of the ROW. BIA also reserves the right to use an additional 30 days to review the application and request the applicant to submit additional information within 15 days. BIA will then grant or deny the application within 30 days of notifying the applicant of needing more time. If BIA denies the application, BIA will provide a written basis for the denial as well as the process for appeal. These provisions provide much needed clarity as to the process and timeline for review, easing the burden and cost of uncertainty to companies. Further, if BIA does not take action under these new timelines, the applicant can first elevate the matter to the BIA Regional Director and then the BIA Director, an appeal process that was not available under the old rules.
Also significant is that BIA deleted the rules specific to telephone lines and communication facilities, removing the size limitations for poles, lines and receiving structures and facilities. Rather, the updated rules expand the definition of Service Lines from telephone, water, electric power, gas and other utilities to include Internet Service. BIA offers additional clarification for service providers, noting that utilities can construct a Service Line from one of the utility's existing ROWs without obtaining a new ROW if the utility serves one structure. If the utility plans to serve more than one structure, then the Service Line will require a ROW. Regardless of the number of structures serves, Service Lines require a Service Line Agreement, which both the utility and the Tribe (or land-owner) must execute and file with BIA prior to constructing Service Lines across Tribal Land or individually-owned land.
In terms of the length of the grant, BIA will defer to a Tribe's determination that the ROW terms are reasonable. For individually owned Indian land, BIA will review the ROW duration to ensure the term is reasonable given the purpose of the ROW. BIA will generally consider a maximum term of up to 50 years for all ROWs other than oil and gas.
The updated rules also include other key provisions:
The new rules represent a huge step forward by clarifying the process and expedited timelines for obtaining ROWs on Tribal lands to deploy communications infrastructure. Should you have any questions about what these new rules mean for your business, please feel free to reach out to Jennifer Holtz at [email protected] or your usual Kelley Drye Communications Practice attorneys.
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