FEDERAL COMMUNICATIONS COMMISSION
August 15.2012
JULIUS GENACHOWSKI
CHAIRMAN
The Iionorable John Boozman
United States 'enate
320 Ilart Senate Of'tiee Building
Washington. D.C. 20510
Dear Senator Boozman:
Thank you for your letter regarding the Commission's Universal Service Fund ( SF)
reforms. I want to assure you that the Commission will continue to work with all stakeholders.
including smaller rate-of-return carriers. throughout the reform process. Additionall).
Commission staff will consider any invitation extended by an Arkansas carrier. Your letter will
be included in the record of the proceeding and considered by the Commission.
As you indicate. the Commission's unanimous overhaul of the Universal Service program
focused on three key goals: delivering broadband to the millions of unserved Americans.
requiring fiscal responsibility and m:eountability in USF spending to ensure the long-term
sustainability of the Fund. and providing transition periods that recognize business realitie
These reforms will put America on thc path to univcrsal broadband and advanced mobile
coverage critical stcps to create new jobs in rural America and across the nation. In particular.
the creation of the Connect America Fund (CA F) wi II accelerate broadband build-out to the 19
million Americans who currently have no acce S to robust broadband infrastructure. This will
create jobs and economic opportunit) for small and large businesses in rural America. as well as
construction workers and salespeople. Increased broadband availability in rural areas will also
help schools and teachers and provide telemedicine opportunities for doctor and health care
providers,
The Commission's implementation of the USF//CC Transjiu'/lWlion Order continues to
be guidcd by these principlc.:s. including making adjustments to the Order as appropriate often
in response to rural carrier concerns. For instance, on April 25. 2012, the Commission extended
the transition lor originating intercarrier compensation payments, addressing a concern raised by
a number ofsmallcr carriers. Likewise. in the Wirelinc Competition Bureau's April Benchmarks
Order. the Bureau revised the initiall) proposed high-cost loop support benchmark categories to
respond to concerns raised by smaller carriers. The revised methodology accounts for several
additional drivers of cost in comparing spending between carricrs: it takes recent invcstment into
consideration: it extends the transillon pcriod to gi\l: carriers more time to adjust: and it provides
a streamlined process to address an) concerns about the accuracy of carriers' data. The
Commission has also extended a number of reporting deadlines for smaller carriers.
445 12TH STREET S.W. WASHINGTON, D.C. 20554 • 202-418·1000
Page 2-The llonorable John Boozman
The Bureau also has been open and transparent as it implements thc reforms, eliciting
public comment and peer rcview, and making all data involved available publicly. Evcn as we
continue to make necessary adjustments, in order to extend broadband to unserved rural
communities while ensuring fiscal responsibility it is important to keep moving forward with
implementation of the Commission's reforms. As we do so. the Commission will continuc to
run a fair, open process in which the valid concerns of stakeholders are addressed - working
closely with affected carriers to ensure that residents of the nation's rural and high-cost areas
receive the quality voice and broadband services that all Americans need.
I appreciate )'our interest in this very important maller. Please let me know if I can be of
an)' further assistance.
Sincerely.
----_. .
Julius Genachowski
FEDERAL COMMUNICATIONS COMMISSION
August 15.2012
.JULIUS GENACHOWSKI
CHAIRMAN
The Iionorable Mark Pryor
United States Senate
255 Dirksen Senate Office Building
Washington. D.C. 20510
Dear Senator Pryor:
Thank you for your letter regarding the Commission's Universal Service Fund (USF)
rcforms. I want to assure you that thc Commission will continue to work with all stakeholders.
including smaller rate-of-return carriers. throughout the reform process. Additionally,
Commission stafTwil1 consider any invitation extended by an Arkansas carrier. Your letter will
be included in the record of the proceeding and considered by the Commission.
As you Indicate. the Commission's unanimous overhaul of the Universal Service program
focused on three key goals: delivering broadband to the millions of unserved Americans.
requiring fiscal responsibility and accountability in USF spending to ensure the long-term
sustainability of the Fund. and providing transition periods that recognize business realities.
These reforms will put America on the path to universal broadband and advanced mobile
coverage - critical steps to create new jobs in rural America and across the nation. In particular,
the creation of the Connect America Fund (CAF) will accelerate broadband build-out to the 19
million Americans who currently have no acce s to robust broadband infrastructure. This will
create jobs and economic opportunity for small and large businesses in rural America, as well as
construction workers and salespeople. Increased broadband availability in rural areas will also
help schools and teachers and provide telemedicine opportunitie for doctors and health care
providers.
The Commission's implementation of the USF fCC Tram/ormalion Order continues to
be guided by thcse principles, including making adjustments to the Order as appropriatc - often
in response to rural carrier concerns. For instance. on April 25, 2012. the Cummission extended
the transition for originating intercarrier compensation payments. addressing a concern raised by
a number of smaller carriers. Likewi e, in the Wireline Competition Bureau's April Benchmarks
Order, the Bureau revised the initially proposed high-cost loop support benchmark categories to
respond to concerns raised by smaller carriers. The revised methodology accounts for several
additional drivers of cost in comparing spending between carriers; it takes recent investment into
consideration; it extends the transition period to give carriers more time to adjust and it provides
a streamlined process to address any concerns about the accuracy of carriers' data. The
Commission has also extended a number of reporting deadlines for smaller carriers.
445 12TH STREET S W WASHINGTON. D.C. 20554 • 202'418'1000
Page 2-The Honorable Mark Pryor
The Bureau also has been open and transparent as it implements the reforms, eliciting
public comment and peer review, and making all data involved available publicly. Even as we
continue to make necessary adjustments, in order to extend broadband to unserved rural
communities while ensuring liscal responsibilily it is important to keep moving forward with
implementation of the Commission's reforms. As we do so, the Commission will continue to
run a fair, open process in which the valid concerns of stakeholders are addressed - working
closely with affected carriers to cnsure that residcnts of the nation's rural and high-cost areas
receive the quality voice and broadband services that all Americans need.
I appreciate your interest in this very importanl mailer. Please letllle know if I can be of
any further assistance.
Sincerely,
----- .
Julius Genachowski