TOM HARKIN 
IOWA 
The Honorable Tom Wheeler 
tlnitrd ~rotrs ~rnatr 
WASHINGTON, DC 20510-1502 
November 19, 2013 
Federal Communications Commission 
445 12th Street, SW 
Washington, DC 20554 
Dear Chairman Wheeler: 
(2021 224-3254 
FAx: (202) 224-9369 
llrV:(2021228 9870 
hnp://harki n .senate.gov 
COMMI flffS: 
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SMALL BUSINESS 
I write to you today to express my concern regarding the Federal Communications Commission (FCC) 
20 II Universal Service Fund Reform Order. This order updated the universal service program for the 
broadband era while maintaining the long-standing requirement that consumers in rural areas have access 
to telecommunications services that are comparable to those available in urban areas. However, I am 
concerned that implementation ofthis Order is limiting the abi lity of small rate-of-return carriers to 
provide rural consumers with the broadband services that they need. 
The Universal Service Fund has always helped to provide small rate-of-return telecom carriers with the 
support they need to keep consumer rates affordable in rural areas. These small companies have long 
utilized this program, along with a number of public and private loan programs, to make long-term capital 
investments to expand the reach and effectiveness of broadband in hard-to-serve rural areas. 
Unfortunately, however, it appears that uncertainties created by the reform order have slowed these kinds 
of investments. Despite the fact that nearly one-fourth of the rural population lacks access to high speed 
broadband, The US Department of Agriculture has stated that demand for Rural Utilities Service loan 
funds for broadband investment has decreased to approximately 37 percent of the total amount of funds 
appropriated by Congress in FY 20 12. 
One of the primary causes of declining small company broadband investment is the Order's use of 
Quantile Regression Analysis (QRA) to cap support to individual rate-of-return companies. Many in the 
rural broadband community are concerned that the QRA caps and redistributes Universal Service Fund 
support in arbitrary and unpredictable ways and that it fails to provide incentives for broadband 
deployment, resulting in regulatory uncertainty and discouraging investment. 
Unless the FCC finds a way to restore predictabili.ty and transparency to the Universal Service Fund 
program, many rural Americans may soon find it difficult to obtain the broadband services they need. If 
not addressed soon, the Reform Order has the potential to further the digital divide between urban and 
rural communities. 
I appreciate your attention to this matter and look forward to your response. 
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/i:_UL 
Tom Harkin 
United States Senator 
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