FEDERAL COMMUNICATIONS COMMISSION January 8, 2013 JULIUS GENACHOWSKI CHAIRMAN Th.e Honorable William 1. Owens V.S. House of Representatives 431 Cannon House Office Building Washington, D.C. 20515 Dear Congressman Owens: Thank you for your letter regarding the FCC's Universal Service Fund reforms. I appreciate your interest this matter and am pleased to provide the enclosed letter on this issue from the Chiefof the Wireline Competition Bureau's Telecommunications Access Policy Division. If you have any additional questions or need any further assistance, please do nothesitate to contact me. Sincerely, Julius Genachowski Enclosure. 445 12TH STREET s.w. WASHINGTON, D.C. 20554 • 202-418-1000 • Federal Communications Commission Washington, D.C. 20554 January 8, 2013 The Honorablc William L. Owens U. S. House of Representatives -I.' I ('unIHln HllllSe OCliee Bui Icling Washington, DC 20515 Dear Congressman Owens: Tbank you for your letter expressing concerns about the effect of the ('omnlisslon's Universal Service Fund (USFj rcforms on rural telecommunications providers in upstate New York. I want to assure you that the Commission will continue 10 work with all stakeholders, including smaller rate-of-return carriers, throughout the reform process. Your letter will be included in the record of the proceeding and considered hy the Commission. The Commission's implementation of the USFIICC Transformation Order continucs to be guided hy these three key goals: expanding broadhand to thc millions of unserved Americans, increasing fiscal responsibility and accountability in USF spending to ensure the long tcrm sustainability of the Fund, and setting forth transition periods that recognize business realities. In addition, as we hear from stakeholders about concerns with implementation, we will make adjustments as appropriate. For instance, on April 2';.2012. the Commission extended the transition for originating interearrier compensation payments, a concern raised by many smaller carriers. Likewise, in the Wirelinc Competition Bureau's April Benchmarks Order, the Bureau revised the initially proposed high-cost loop suppOli benchmark categories to rcspond to a numbcr of the conccrns raiscd bv smaller carriers. In particular. the revised methodology accounts for sevcral additional drivers of cost in comparing spending between carriers, it takes recent Investment into consideration, II extends the tranSition period to give carriers greatcr time to adjust, and it provides a streamlined process to address any concerns about the accuracy o I' carriers' data. The Commission has also extended a number of reporting dcadlines [or smaller carriers. Evcn as we continue to make necessary adjustments, it is important to keep moving forward with implementation of the Commission's once-in-a generation reforms and not roll back progress that we havc made. As we do, the Commission and staff will cOlltinuc to rlln a fair, opcn proccss in which the valid concerns of stakeholders are addrcssed working closely with aCCected carriers to ensure that residents of the nation's Page 2 -- The Honorable William L. Owens rural and high-cost areas receive the quality voice and broadband services that all Americans need. [ appreciate your interest in this very important matter. Please let me know if I can be of any further assistance. Sincerely, Trent B. Harkrader Chief Telecommunications Access Policy Division Wireline Competition Bureau