CLAIRE McCASKILL MISSOURI tlnitrd ~rates ~rnatr WASHINGTON, DC 20510 December 12, 2017 The Honorable Ajit Pai, Chairman The Honorable Mignon Clyburn, Commissioner The Honorable Jessica Rosenworcel, Commissioner The Honorable Michael O'Rielly, Commissioner The Honorable Brendan Carr, Commissioner Federal Communications Commission 445 121h Street SW Washington, DC 20554 Dear Chairman Pai and Commissioners Clyburn, Rosenworcel, O'Rielly, and Carr: I write to urge the Federal Communications Commission (FCC) to ensure that the Connect America Fund (CAF) Phase II Auction has sufficient safeguards to ensure a fair auction and prevent waste, fraud, and abuse. Because AT&T declined CAF funding in Missouri, more than 112,000 locations in rural Missouri are preliminarily eligible for universal service funding through the auction. These unserved communities have been waiting years for broadband and the auction presents a unique opportunity to finally allow universal service funding to flow to these communities in Missouri. I am concerned, however, that the Commission may fail to adopt sufficient safeguards in the auction. Absent adequate safeguards, the auction could not only fail to connect rural Missouri with broadband, but also risks introducing waste and fraud into the program. I have been vigilant in tackling fraud in the FCC's universal service programs, especially Lifeline. Lifeline fraud continues to occur because the commission failed to put safeguards and oversight requirements in place, and the agency should not make the same mistake with respect to the CAF Phase II Auction. To protect the integrity of the program, I urge the commission to screen applicants to ensure they are both qualified to participate and have the ability to serve all unserved households in geographic areas where they are bidding with the applicable speed and capacity. Serving only a fraction of these households will fail to deliver on the promise of universal service. The commission should use the framework of the New York state auction as a model and require providers to submit propagation maps for wireless providers or network diagrams for other providers to ensure they have designed a network that can serve the area. Providing such information after the auction is over is too late. Providers should also show that they have the financial resources to deploy to ensure that the provider does not default before fulfilling its obligation. In addition, I strongly encourage the commission to prevent technologies from bidding in speed tiers that are not commercially available today. I agree with the electric cooperatives and rural 1078 telephone companies in Missouri that wireless and satellite internet service providers should not be able to bid in the 100 Mbps and 1 Gbps tiers. While I support technology neutrality, the commission should not use finite universal service funding on technologies that are not yet available and - indeed - may never be available. Adopting these common sense safeguards should help ensure a fair auction and help to finally deliver on our nation' s universal service promise to rural Missourians. Thank you for your leadership adopting the final rules for the CAF Phase II Auction and committing to conduct the auction in 2018. I look forward to continuing to work together to close the digital divide in Missouri. Sincerely, ~~c~ Claire McCaskill United States Senator