USTelecom Seeks Rehearing of Calif. BEAD Volume 2 Rules
With more than $1.8 billion in federal cash from the broadband equity, access and deployment (BEAD) program on the line, USTelecom asked the California Public Utilities Commission to reconsider its rules for implementing the state’s BEAD initial plan volume 2. In a rehearing application (docket R.23-02-016) posted Friday at the CPUC, the national ISP association said it “cannot stand by and risk the Commission’s adoption of a collective set of requirements that will severely limit participation in and the overall effectiveness of California’s BEAD Program.” The commission should deny USTelecom's application, a consumer advocate urged.
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During a Sept. 26 meeting, California commissioners voted 4-0 to approve state rules implementing volume 2 of the plan for rolling out the $1.86 billion BEAD allocation (see 2409260066). The CPUC submitted both volumes of its initial plan to NTIA on Dec. 26 last year.
“The state needs to get this right,” a USTelecom spokesperson said. “The CPUC should take this up quickly to avoid any unnecessary delays.”
USTelecom raised concerns about state rules that require BEAD applicants to offer low-cost and middle-class affordability plans with capped rates of $30 and $84 a month, respectively, unless they meet what the ISP association called “a high bar for rate modification.” Setting those prices is unlawful broadband rate regulation, the association argued. Also, problematically, said USTelecom, receiving a modification from the $30 rate requires participating in low-income connectivity programs like federal Lifeline or California LifeLine -- or whatever low-income program the commission determines. In addition, at one point in the rules, the CPUC contradicts the $30 low-cost plan rate when it says that providers eligible for the federal affordable connectivity (ACP) program must provide a no-cost option, USTelecom said.
The Infrastructure Investment and Jobs Act (IIJA) and NTIA rules don’t “contemplate a provider’s participation in Federal Lifeline or state equivalents as a condition of meeting the BEAD Program’s low-cost pricing requirements,” USTelecom argued. Further, participating in such programs isn’t a requirement in the CPUC’s federal funding account rules, it said. “Imposing such a requirement only as part of the Commission’s BEAD Program would create inconsistent conditions across California’s broadband grant programs.” Also, letting the commission choose the program after getting an award “violates Subgrantees’ rights and is bad policy.”
“The combination of all of these errors in their totality present a serious concern because they collectively will hinder California’s ability to meet the BEAD Program’s overarching goal of finally connecting all unserved and underserved locations to broadband service in a manner that does not regulate the service’s underlying rates,” said USTelecom.
Yet Leo Fitzpatrick, telecom policy analyst for The Utility Reform Network, said USTelecom’s “application is misplaced.” Fitzpatrick added, “The CPUC's approach was approved by the NTIA.” In addition, it’s incorrect that the CPUC can’t require participation in state or federal Lifeline programs in the rate modification requirement.
The California Broadband and Video Association is reviewing USTelecom’s rehearing request, said CalBroadband President Janus Norman in an email. The state cable industry association previously filed comments on the volume 2 rules “with proposed revisions to promote robust participation in the program and provide the Commission with the best chance of connecting all unserved and underserved Californians to reliable, high-speed broadband service,” Norman added.