Pa. PUC Approves State USF Rules Review, Potential Harmonization With Feds

The Pennsylvania Public Utility Commission voted 5-0 Thursday to move forward on an advance notice of proposed rulemaking (ANOPR) on amending state USF rules. The PUC during a livestreamed meeting approved a bid by Chairman Gladys Brown Dutrieuille to seek comment on what she said are “broad questions about the challenges of supporting voice and internet networks and services” as part of the ANOPR. The PUC postponed considering the rulemaking proposal in early August (see 2308020057). Comments on the ANOPR in docket L-2023-3040646 are due 90 days after its publication in the Pennsylvania Bulletin, with replies due within 120 days.

The PUC “does not yet have a record to support efforts to reform” the state-level USF “nor suggested language for implementing those changes,” Dutrieuille said. Additional inquiry is needed into whether the commission should “model its own approach to universal service to construct a voice network that can provide voice but also internet service at federal speeds and require recipients to stand ready” to provide those services “at a required speed as a condition of receiving” state funding as a provider of last resort or carrier of last resort obligations. The PUC will eye whether to “augment” the state USF “by providing support so that consumers can purchase” voice and internet “to further” the federal Communications Act Section 254 and state mandates that “there must be comparable rates for comparable services in rural and urban areas.”

The ANOPR will examine whether the PUC should continue to base the state USF’s funding mechanism on “assessments on services from retail intrastate revenues alone” or instead expand the contribution base “to include revenues from all regulated and unregulated services provided over a supported network, including wholesale revenues,” Dutrieuille said in her motion. The commission will eye whether to “continue prohibiting a stand-alone surcharge on individual consumers to recover the cost of universal service.” The PUC will also determine “whether to alter the USF’s structure” from the current model of basing support on an ILEC's “entire service territory” and whether the changes should be “consistent with federal law,” the motion said.

The PUC will decide whether there’s another mechanism besides “certification of VoIP providers” it can use to implement the universal service provisions of the state’s VoIP Freedom Bill “and ensure compliance with” both that measure and the public utility code, Dutrieuille said in her motion. The commission should also examine whether competition remains a valid focus when it comes to supporting networks and services given that over 95% of today’s consumers are served by the ‘last mile’ network owned by … telephone and cable” providers “with cable and fiber networks lacking an open access mandate for competitors” under statute. Dutrieuille also wants to know how the PUC should use the ANOPR to address VoIP jurisdictional issues she raised when she dissented in the commission’s 2-1 approval of a petition by T-Mobile’s Sprint to discontinue CLEC and interexchange services while continuing VoIP service in the state (see 2208250029).

Commissioner John Coleman wants ANOPR commenters to also address “additional areas of inquiry” so the PUC can consider “a full range” of potential state USF “reforms” he believes may be necessary (see 2212080038). The ANOPR says expanding the state USF “beyond basic telephone service would align with federally applicable principles regarding supported services,” but commenters should address whether the PUC “has the authority to establish such requirements,” Coleman said. He wants commenters to say whether they think the commission “has the authority to establish a numbers-based contribution system” for USF.

Coleman asked commenters to opine on whether the PUC has the authority to “eliminate” or otherwise phase out the USF. “I am not advocating for any specific outcome with Pa. USF reform at this time,” so “my additional questions addressing the elimination of the fund should not be construed as my advocating to eliminate it,” he said: “Rather, the questions are intended to ensure” the PUC “conducts a comprehensive review of” the state USF “and receives input on the full range of … reform options available to us.”

PUC Vice Chairman Stephen DeFrank strongly backed the ANOPR, saying “a Pennsylvanian should be able to pick up a landline telephone” anywhere in the state “and connect to the public switched telephone network to call a neighbor across the street, a loved one across the country, or access emergency services” with “high quality” connection “at an affordable rate.”