Federal Communications Commission Washington, D.C. 20554 October 10, 2023 The Honorable Maria Cantwell Chair Committee on Commerce, Science, and Transportation United States Senate 428 Dirksen Senate Office Building Washington, DC 20510 Dear Madam Chair: In the Secure and Trusted Communications Networks Act, Congress directed the Federal Communications Commission to establish the Secure and Trusted Communications Networks Reimbursement Program to advance national security by supporting the removal, replacement, and disposal of communications equipment and services produced or provided by Huawei Technologies Company or ZTE Corporation from our Nation’s communications networks. The Commission has made the successful implementation of the Reimbursement Program one of its top priorities. On behalf of the agency, over the last two years I have provided six updates to Congress concerning the Commission’s work to review and process the applications submitted to the Reimbursement Program.1 Today I am writing to continue to keep you informed of the status of our work administering the Reimbursement Program in light of upcoming deadlines under the law. In order to apply for the Reimbursement Program, eligible providers of advanced communications service were required to file applications with the Commission, including a plan for the full removal, replacement, and disposal of the Huawei and ZTE equipment in their networks. The Commission issued decisions approving or denying these applications on July 15, 2022. The approved applications sought approximately $4.98 billion in reasonable costs, reflecting a $3.08 billion shortfall from the current appropriation of $1.9 billion. Because the demand for support exceeded the current appropriation, under the Secure and Trusted Communications Networks Act, the Commission was required to prioritize applicants with two million or fewer customers,2 and even then, the Commission was compelled to prorate funds, providing 39.5 percent of reasonable costs. 1 Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (Feb. 4, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Gary C. Peters, et al. (May 20, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (June 1, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (June 15, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (July 15, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (May 3, 2023). 2 The Commission was also compelled to deny one application from an otherwise eligible applicant because it was in a lower priority tier due to the size of its customer base (between two and ten million customers). Page 2 – The Honorable Maria Cantwell Those applicants approved for funding support in the Reimbursement Program were required to submit at least one reimbursement claim to the agency by July 17, 2023.3 The Secure and Trusted Networks Communications Act requires that Reimbursement Program recipients complete the permanent removal, replacement, and disposal of Huawei and ZTE communications equipment and services in their networks within one year of the first distribution of reimbursement funds to the recipient.4 As of October 2, 2023, reimbursement claim requests have been submitted for 122 of the 126 applications approved for the Reimbursement Program and the Commission has approved distributions of reimbursement funds for 112 of those applications, which now have deadlines to remove all Huawei and ZTE communications equipment and services ranging from October 8, 2023 to September 23, 2024, based on the initial distribution of funds to the recipients. The Commission subsequently received several requests to extend Reimbursement Program recipients’ one-year removal, replacement, and disposal term by six months. The law permits the Commission to provide such six-month extensions if they are “due to no fault of such recipient.”5 Many of the recipients requesting extensions claim they are unable to timely complete this project without full funding. On October 10, 2023, the Wireline Competition Bureau granted several of these extensions for a period of six months, finding that the lack of full funding had slowed their removal, replacement, and disposal processes. It is important to note, however, that the grant of these extensions does not lessen the urgency for a fully funded Reimbursement Program. Indeed, the lack of full funding means that insecure equipment will remain in our Nation’s communications networks for a longer period. The Commission stands ready to assist Congress in any efforts to fully fund the Reimbursement Program and support the removal of insecure equipment from our communications infrastructure. I hope this information is helpful to you. I look forward to continuing to work with you to achieve the goals of the Reimbursement Program and the essential task of securing our Nation’s communications networks. Sincerely, Jessica Rosenworcel 3 47 CFR § 1.50004(g)(1) (“Within one year of the approval of its Reimbursement Program application, a recipient must file at least one reimbursement claim.”); see also Wireline Competition Bureau Reminds Secure and Trusted Communications Networks Reimbursement Program Recipients of the July 17, 2023 Deadline to File an Initial Reimbursement Claim, WC Docket No. 18-89, Public Notice, DA 23-445 (WCB May 24, 2023). 4 47 U.S.C. § 1603(d)(6)(A). 5 47 U.S.C. § 1603(d)(6)(C). Federal Communications Commission Washington, D.C. 20554 October 10, 2023 The Honorable Ted Cruz Ranking Member Committee on Commerce, Science, and Transportation United States Senate 512 Hart Senate Office Building Washington, DC 20510 Dear Ranking Member Cruz: In the Secure and Trusted Communications Networks Act, Congress directed the Federal Communications Commission to establish the Secure and Trusted Communications Networks Reimbursement Program to advance national security by supporting the removal, replacement, and disposal of communications equipment and services produced or provided by Huawei Technologies Company or ZTE Corporation from our Nation’s communications networks. The Commission has made the successful implementation of the Reimbursement Program one of its top priorities. On behalf of the agency, over the last two years I have provided six updates to Congress concerning the Commission’s work to review and process the applications submitted to the Reimbursement Program.1 Today I am writing to continue to keep you informed of the status of our work administering the Reimbursement Program in light of upcoming deadlines under the law. In order to apply for the Reimbursement Program, eligible providers of advanced communications service were required to file applications with the Commission, including a plan for the full removal, replacement, and disposal of the Huawei and ZTE equipment in their networks. The Commission issued decisions approving or denying these applications on July 15, 2022. The approved applications sought approximately $4.98 billion in reasonable costs, reflecting a $3.08 billion shortfall from the current appropriation of $1.9 billion. Because the demand for support exceeded the current appropriation, under the Secure and Trusted Communications Networks Act, the Commission was required to prioritize applicants with two million or fewer customers,2 and even then, the Commission was compelled to prorate funds, providing 39.5 percent of reasonable costs. 1 Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (Feb. 4, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Gary C. Peters, et al. (May 20, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (June 1, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (June 15, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (July 15, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (May 3, 2023). 2 The Commission was also compelled to deny one application from an otherwise eligible applicant because it was in a lower priority tier due to the size of its customer base (between two and ten million customers). Page 2 – The Honorable Ted Cruz Those applicants approved for funding support in the Reimbursement Program were required to submit at least one reimbursement claim to the agency by July 17, 2023.3 The Secure and Trusted Networks Communications Act requires that Reimbursement Program recipients complete the permanent removal, replacement, and disposal of Huawei and ZTE communications equipment and services in their networks within one year of the first distribution of reimbursement funds to the recipient.4 As of October 2, 2023, reimbursement claim requests have been submitted for 122 of the 126 applications approved for the Reimbursement Program and the Commission has approved distributions of reimbursement funds for 112 of those applications, which now have deadlines to remove all Huawei and ZTE communications equipment and services ranging from October 8, 2023 to September 23, 2024, based on the initial distribution of funds to the recipients. The Commission subsequently received several requests to extend Reimbursement Program recipients’ one-year removal, replacement, and disposal term by six months. The law permits the Commission to provide such six-month extensions if they are “due to no fault of such recipient.”5 Many of the recipients requesting extensions claim they are unable to timely complete this project without full funding. On October 10, 2023, the Wireline Competition Bureau granted several of these extensions for a period of six months, finding that the lack of full funding had slowed their removal, replacement, and disposal processes. It is important to note, however, that the grant of these extensions does not lessen the urgency for a fully funded Reimbursement Program. Indeed, the lack of full funding means that insecure equipment will remain in our Nation’s communications networks for a longer period. The Commission stands ready to assist Congress in any efforts to fully fund the Reimbursement Program and support the removal of insecure equipment from our communications infrastructure. I hope this information is helpful to you. I look forward to continuing to work with you to achieve the goals of the Reimbursement Program and the essential task of securing our Nation’s communications networks. Sincerely, Jessica Rosenworcel 3 47 CFR § 1.50004(g)(1) (“Within one year of the approval of its Reimbursement Program application, a recipient must file at least one reimbursement claim.”); see also Wireline Competition Bureau Reminds Secure and Trusted Communications Networks Reimbursement Program Recipients of the July 17, 2023 Deadline to File an Initial Reimbursement Claim, WC Docket No. 18-89, Public Notice, DA 23-445 (WCB May 24, 2023). 4 47 U.S.C. § 1603(d)(6)(A). 5 47 U.S.C. § 1603(d)(6)(C). Federal Communications Commission Washington, D.C. 20554 October 10, 2023 The Honorable Cathy McMorris Rodgers Chair Committee on Energy and Commerce U.S. House of Representatives 2125 Rayburn House Office Building Washington, DC 20515 Dear Madam Chair: In the Secure and Trusted Communications Networks Act, Congress directed the Federal Communications Commission to establish the Secure and Trusted Communications Networks Reimbursement Program to advance national security by supporting the removal, replacement, and disposal of communications equipment and services produced or provided by Huawei Technologies Company or ZTE Corporation from our Nation’s communications networks. The Commission has made the successful implementation of the Reimbursement Program one of its top priorities. On behalf of the agency, over the last two years I have provided six updates to Congress concerning the Commission’s work to review and process the applications submitted to the Reimbursement Program.1 Today I am writing to continue to keep you informed of the status of our work administering the Reimbursement Program in light of upcoming deadlines under the law. In order to apply for the Reimbursement Program, eligible providers of advanced communications service were required to file applications with the Commission, including a plan for the full removal, replacement, and disposal of the Huawei and ZTE equipment in their networks. The Commission issued decisions approving or denying these applications on July 15, 2022. The approved applications sought approximately $4.98 billion in reasonable costs, reflecting a $3.08 billion shortfall from the current appropriation of $1.9 billion. Because the demand for support exceeded the current appropriation, under the Secure and Trusted Communications Networks Act, the Commission was required to prioritize applicants with two million or fewer customers,2 and even then, the Commission was compelled to prorate funds, providing 39.5 percent of reasonable costs. 1 Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (Feb. 4, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Gary C. Peters, et al. (May 20, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (June 1, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (June 15, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (July 15, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (May 3, 2023). 2 The Commission was also compelled to deny one application from an otherwise eligible applicant because it was in a lower priority tier due to the size of its customer base (between two and ten million customers). Page 2 – The Honorable Cathy McMorris Rodgers Those applicants approved for funding support in the Reimbursement Program were required to submit at least one reimbursement claim to the agency by July 17, 2023.3 The Secure and Trusted Networks Communications Act requires that Reimbursement Program recipients complete the permanent removal, replacement, and disposal of Huawei and ZTE communications equipment and services in their networks within one year of the first distribution of reimbursement funds to the recipient.4 As of October 2, 2023, reimbursement claim requests have been submitted for 122 of the 126 applications approved for the Reimbursement Program and the Commission has approved distributions of reimbursement funds for 112 of those applications, which now have deadlines to remove all Huawei and ZTE communications equipment and services ranging from October 8, 2023 to September 23, 2024, based on the initial distribution of funds to the recipients. The Commission subsequently received several requests to extend Reimbursement Program recipients’ one-year removal, replacement, and disposal term by six months. The law permits the Commission to provide such six-month extensions if they are “due to no fault of such recipient.”5 Many of the recipients requesting extensions claim they are unable to timely complete this project without full funding. On October 10, 2023, the Wireline Competition Bureau granted several of these extensions for a period of six months, finding that the lack of full funding had slowed their removal, replacement, and disposal processes. It is important to note, however, that the grant of these extensions does not lessen the urgency for a fully funded Reimbursement Program. Indeed, the lack of full funding means that insecure equipment will remain in our Nation’s communications networks for a longer period. The Commission stands ready to assist Congress in any efforts to fully fund the Reimbursement Program and support the removal of insecure equipment from our communications infrastructure. I hope this information is helpful to you. I look forward to continuing to work with you to achieve the goals of the Reimbursement Program and the essential task of securing our Nation’s communications networks. Sincerely, Jessica Rosenworcel 3 47 CFR § 1.50004(g)(1) (“Within one year of the approval of its Reimbursement Program application, a recipient must file at least one reimbursement claim.”); see also Wireline Competition Bureau Reminds Secure and Trusted Communications Networks Reimbursement Program Recipients of the July 17, 2023 Deadline to File an Initial Reimbursement Claim, WC Docket No. 18-89, Public Notice, DA 23-445 (WCB May 24, 2023). 4 47 U.S.C. § 1603(d)(6)(A). 5 47 U.S.C. § 1603(d)(6)(C). Federal Communications Commission Washington, D.C. 20554 October 10, 2023 The Honorable Frank Pallone Ranking Member Committee on Energy and Commerce U.S. House of Representatives 2322 Rayburn house Office Building Washington, DC 20515 Dear Ranking Member Pallone: In the Secure and Trusted Communications Networks Act, Congress directed the Federal Communications Commission to establish the Secure and Trusted Communications Networks Reimbursement Program to advance national security by supporting the removal, replacement, and disposal of communications equipment and services produced or provided by Huawei Technologies Company or ZTE Corporation from our Nation’s communications networks. The Commission has made the successful implementation of the Reimbursement Program one of its top priorities. On behalf of the agency, over the last two years I have provided six updates to Congress concerning the Commission’s work to review and process the applications submitted to the Reimbursement Program.1 Today I am writing to continue to keep you informed of the status of our work administering the Reimbursement Program in light of upcoming deadlines under the law. In order to apply for the Reimbursement Program, eligible providers of advanced communications service were required to file applications with the Commission, including a plan for the full removal, replacement, and disposal of the Huawei and ZTE equipment in their networks. The Commission issued decisions approving or denying these applications on July 15, 2022. The approved applications sought approximately $4.98 billion in reasonable costs, reflecting a $3.08 billion shortfall from the current appropriation of $1.9 billion. Because the demand for support exceeded the current appropriation, under the Secure and Trusted Communications Networks Act, the Commission was required to prioritize applicants with two million or fewer customers,2 and even then, the Commission was compelled to prorate funds, providing 39.5 percent of reasonable costs. 1 Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (Feb. 4, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Gary C. Peters, et al. (May 20, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (June 1, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (June 15, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (July 15, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (May 3, 2023). 2 The Commission was also compelled to deny one application from an otherwise eligible applicant because it was in a lower priority tier due to the size of its customer base (between two and ten million customers). Page 2 – The Honorable Frank Pallone Those applicants approved for funding support in the Reimbursement Program were required to submit at least one reimbursement claim to the agency by July 17, 2023.3 The Secure and Trusted Networks Communications Act requires that Reimbursement Program recipients complete the permanent removal, replacement, and disposal of Huawei and ZTE communications equipment and services in their networks within one year of the first distribution of reimbursement funds to the recipient.4 As of October 2, 2023, reimbursement claim requests have been submitted for 122 of the 126 applications approved for the Reimbursement Program and the Commission has approved distributions of reimbursement funds for 112 of those applications, which now have deadlines to remove all Huawei and ZTE communications equipment and services ranging from October 8, 2023 to September 23, 2024, based on the initial distribution of funds to the recipients. The Commission subsequently received several requests to extend Reimbursement Program recipients’ one-year removal, replacement, and disposal term by six months. The law permits the Commission to provide such six-month extensions if they are “due to no fault of such recipient.”5 Many of the recipients requesting extensions claim they are unable to timely complete this project without full funding. On October 10, 2023, the Wireline Competition Bureau granted several of these extensions for a period of six months, finding that the lack of full funding had slowed their removal, replacement, and disposal processes. It is important to note, however, that the grant of these extensions does not lessen the urgency for a fully funded Reimbursement Program. Indeed, the lack of full funding means that insecure equipment will remain in our Nation’s communications networks for a longer period. The Commission stands ready to assist Congress in any efforts to fully fund the Reimbursement Program and support the removal of insecure equipment from our communications infrastructure. I hope this information is helpful to you. I look forward to continuing to work with you to achieve the goals of the Reimbursement Program and the essential task of securing our Nation’s communications networks. Sincerely, Jessica Rosenworcel 3 47 CFR § 1.50004(g)(1) (“Within one year of the approval of its Reimbursement Program application, a recipient must file at least one reimbursement claim.”); see also Wireline Competition Bureau Reminds Secure and Trusted Communications Networks Reimbursement Program Recipients of the July 17, 2023 Deadline to File an Initial Reimbursement Claim, WC Docket No. 18-89, Public Notice, DA 23-445 (WCB May 24, 2023). 4 47 U.S.C. § 1603(d)(6)(A). 5 47 U.S.C. § 1603(d)(6)(C). Federal Communications Commission Washington, D.C. 20554 October 10, 2023 The Honorable Chris Van Hollen Chairman Subcommittee on Financial Services and General Government Committee on Appropriations United States Senate S-128 The Capitol Building Washington, DC 20510 Dear Chairman Van Hollen: In the Secure and Trusted Communications Networks Act, Congress directed the Federal Communications Commission to establish the Secure and Trusted Communications Networks Reimbursement Program to advance national security by supporting the removal, replacement, and disposal of communications equipment and services produced or provided by Huawei Technologies Company or ZTE Corporation from our Nation’s communications networks. The Commission has made the successful implementation of the Reimbursement Program one of its top priorities. On behalf of the agency, over the last two years I have provided six updates to Congress concerning the Commission’s work to review and process the applications submitted to the Reimbursement Program.1 Today I am writing to continue to keep you informed of the status of our work administering the Reimbursement Program in light of upcoming deadlines under the law. In order to apply for the Reimbursement Program, eligible providers of advanced communications service were required to file applications with the Commission, including a plan for the full removal, replacement, and disposal of the Huawei and ZTE equipment in their networks. The Commission issued decisions approving or denying these applications on July 15, 2022. The approved applications sought approximately $4.98 billion in reasonable costs, reflecting a $3.08 billion shortfall from the current appropriation of $1.9 billion. Because the demand for support exceeded the current appropriation, under the Secure and Trusted Communications Networks Act, the Commission was required to prioritize applicants with two million or fewer customers,2 and even then, the Commission was compelled to prorate funds, providing 39.5 percent of reasonable costs. 1 Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (Feb. 4, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Gary C. Peters, et al. (May 20, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (June 1, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (June 15, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (July 15, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (May 3, 2023). 2 The Commission was also compelled to deny one application from an otherwise eligible applicant because it was in a lower priority tier due to the size of its customer base (between two and ten million customers). Page 2 – The Honorable Chris Van Hollen Those applicants approved for funding support in the Reimbursement Program were required to submit at least one reimbursement claim to the agency by July 17, 2023.3 The Secure and Trusted Networks Communications Act requires that Reimbursement Program recipients complete the permanent removal, replacement, and disposal of Huawei and ZTE communications equipment and services in their networks within one year of the first distribution of reimbursement funds to the recipient.4 As of October 2, 2023, reimbursement claim requests have been submitted for 122 of the 126 applications approved for the Reimbursement Program and the Commission has approved distributions of reimbursement funds for 112 of those applications, which now have deadlines to remove all Huawei and ZTE communications equipment and services ranging from October 8, 2023 to September 23, 2024, based on the initial distribution of funds to the recipients. The Commission subsequently received several requests to extend Reimbursement Program recipients’ one-year removal, replacement, and disposal term by six months. The law permits the Commission to provide such six-month extensions if they are “due to no fault of such recipient.”5 Many of the recipients requesting extensions claim they are unable to timely complete this project without full funding. On October 10, 2023, the Wireline Competition Bureau granted several of these extensions for a period of six months, finding that the lack of full funding had slowed their removal, replacement, and disposal processes. It is important to note, however, that the grant of these extensions does not lessen the urgency for a fully funded Reimbursement Program. Indeed, the lack of full funding means that insecure equipment will remain in our Nation’s communications networks for a longer period. The Commission stands ready to assist Congress in any efforts to fully fund the Reimbursement Program and support the removal of insecure equipment from our communications infrastructure. I hope this information is helpful to you. I look forward to continuing to work with you to achieve the goals of the Reimbursement Program and the essential task of securing our Nation’s communications networks. Sincerely, Jessica Rosenworcel 3 47 CFR § 1.50004(g)(1) (“Within one year of the approval of its Reimbursement Program application, a recipient must file at least one reimbursement claim.”); see also Wireline Competition Bureau Reminds Secure and Trusted Communications Networks Reimbursement Program Recipients of the July 17, 2023 Deadline to File an Initial Reimbursement Claim, WC Docket No. 18-89, Public Notice, DA 23-445 (WCB May 24, 2023). 4 47 U.S.C. § 1603(d)(6)(A). 5 47 U.S.C. § 1603(d)(6)(C). Federal Communications Commission Washington, D.C. 20554 October 10, 2023 The Honorable Bill Hagerty Ranking Member Subcommittee on Financial Services and General Government Committee on Appropriations United States Senate 125 Hart Senate Office Building Washington, DC 20510 Dear Ranking Member Hagerty: In the Secure and Trusted Communications Networks Act, Congress directed the Federal Communications Commission to establish the Secure and Trusted Communications Networks Reimbursement Program to advance national security by supporting the removal, replacement, and disposal of communications equipment and services produced or provided by Huawei Technologies Company or ZTE Corporation from our Nation’s communications networks. The Commission has made the successful implementation of the Reimbursement Program one of its top priorities. On behalf of the agency, over the last two years I have provided six updates to Congress concerning the Commission’s work to review and process the applications submitted to the Reimbursement Program.1 Today I am writing to continue to keep you informed of the status of our work administering the Reimbursement Program in light of upcoming deadlines under the law. In order to apply for the Reimbursement Program, eligible providers of advanced communications service were required to file applications with the Commission, including a plan for the full removal, replacement, and disposal of the Huawei and ZTE equipment in their networks. The Commission issued decisions approving or denying these applications on July 15, 2022. The approved applications sought approximately $4.98 billion in reasonable costs, reflecting a $3.08 billion shortfall from the current appropriation of $1.9 billion. Because the demand for support exceeded the current appropriation, under the Secure and Trusted Communications Networks Act, the Commission was required to prioritize applicants with two million or fewer customers,2 and even then, the Commission was compelled to prorate funds, providing 39.5 percent of reasonable costs. 1 Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (Feb. 4, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Gary C. Peters, et al. (May 20, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (June 1, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (June 15, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (July 15, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (May 3, 2023). 2 The Commission was also compelled to deny one application from an otherwise eligible applicant because it was in a lower priority tier due to the size of its customer base (between two and ten million customers). Page 2 – The Honorable Bill Hagerty Those applicants approved for funding support in the Reimbursement Program were required to submit at least one reimbursement claim to the agency by July 17, 2023.3 The Secure and Trusted Networks Communications Act requires that Reimbursement Program recipients complete the permanent removal, replacement, and disposal of Huawei and ZTE communications equipment and services in their networks within one year of the first distribution of reimbursement funds to the recipient.4 As of October 2, 2023, reimbursement claim requests have been submitted for 122 of the 126 applications approved for the Reimbursement Program and the Commission has approved distributions of reimbursement funds for 112 of those applications, which now have deadlines to remove all Huawei and ZTE communications equipment and services ranging from October 8, 2023 to September 23, 2024, based on the initial distribution of funds to the recipients. The Commission subsequently received several requests to extend Reimbursement Program recipients’ one-year removal, replacement, and disposal term by six months. The law permits the Commission to provide such six-month extensions if they are “due to no fault of such recipient.”5 Many of the recipients requesting extensions claim they are unable to timely complete this project without full funding. On October 10, 2023, the Wireline Competition Bureau granted several of these extensions for a period of six months, finding that the lack of full funding had slowed their removal, replacement, and disposal processes. It is important to note, however, that the grant of these extensions does not lessen the urgency for a fully funded Reimbursement Program. Indeed, the lack of full funding means that insecure equipment will remain in our Nation’s communications networks for a longer period. The Commission stands ready to assist Congress in any efforts to fully fund the Reimbursement Program and support the removal of insecure equipment from our communications infrastructure. I hope this information is helpful to you. I look forward to continuing to work with you to achieve the goals of the Reimbursement Program and the essential task of securing our Nation’s communications networks. Sincerely, Jessica Rosenworcel 3 47 CFR § 1.50004(g)(1) (“Within one year of the approval of its Reimbursement Program application, a recipient must file at least one reimbursement claim.”); see also Wireline Competition Bureau Reminds Secure and Trusted Communications Networks Reimbursement Program Recipients of the July 17, 2023 Deadline to File an Initial Reimbursement Claim, WC Docket No. 18-89, Public Notice, DA 23-445 (WCB May 24, 2023). 4 47 U.S.C. § 1603(d)(6)(A). 5 47 U.S.C. § 1603(d)(6)(C). Federal Communications Commission Washington, D.C. 20554 October 10, 2023 The Honorable Steve Womack Chair Subcommittee on Financial Services and General Government Committee on Appropriations U.S. House of Representatives 2000 Rayburn House Office Building (G Floor) Washington, DC 20515 Dear Chairman Womack: In the Secure and Trusted Communications Networks Act, Congress directed the Federal Communications Commission to establish the Secure and Trusted Communications Networks Reimbursement Program to advance national security by supporting the removal, replacement, and disposal of communications equipment and services produced or provided by Huawei Technologies Company or ZTE Corporation from our Nation’s communications networks. The Commission has made the successful implementation of the Reimbursement Program one of its top priorities. On behalf of the agency, over the last two years I have provided six updates to Congress concerning the Commission’s work to review and process the applications submitted to the Reimbursement Program.1 Today I am writing to continue to keep you informed of the status of our work administering the Reimbursement Program in light of upcoming deadlines under the law. In order to apply for the Reimbursement Program, eligible providers of advanced communications service were required to file applications with the Commission, including a plan for the full removal, replacement, and disposal of the Huawei and ZTE equipment in their networks. The Commission issued decisions approving or denying these applications on July 15, 2022. The approved applications sought approximately $4.98 billion in reasonable costs, reflecting a $3.08 billion shortfall from the current appropriation of $1.9 billion. Because the demand for support exceeded the current appropriation, under the Secure and Trusted Communications Networks Act, the Commission was required to prioritize applicants with two million or fewer customers,2 and even then, the Commission was compelled to prorate funds, providing 39.5 percent of reasonable costs. 1 Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (Feb. 4, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Gary C. Peters, et al. (May 20, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (June 1, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (June 15, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (July 15, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (May 3, 2023). 2 The Commission was also compelled to deny one application from an otherwise eligible applicant because it was in a lower priority tier due to the size of its customer base (between two and ten million customers). Page 2 – The Honorable Steve Womack Those applicants approved for funding support in the Reimbursement Program were required to submit at least one reimbursement claim to the agency by July 17, 2023.3 The Secure and Trusted Networks Communications Act requires that Reimbursement Program recipients complete the permanent removal, replacement, and disposal of Huawei and ZTE communications equipment and services in their networks within one year of the first distribution of reimbursement funds to the recipient.4 As of October 2, 2023, reimbursement claim requests have been submitted for 122 of the 126 applications approved for the Reimbursement Program and the Commission has approved distributions of reimbursement funds for 112 of those applications, which now have deadlines to remove all Huawei and ZTE communications equipment and services ranging from October 8, 2023 to September 23, 2024, based on the initial distribution of funds to the recipients. The Commission subsequently received several requests to extend Reimbursement Program recipients’ one-year removal, replacement, and disposal term by six months. The law permits the Commission to provide such six-month extensions if they are “due to no fault of such recipient.”5 Many of the recipients requesting extensions claim they are unable to timely complete this project without full funding. On October 10, 2023, the Wireline Competition Bureau granted several of these extensions for a period of six months, finding that the lack of full funding had slowed their removal, replacement, and disposal processes. It is important to note, however, that the grant of these extensions does not lessen the urgency for a fully funded Reimbursement Program. Indeed, the lack of full funding means that insecure equipment will remain in our Nation’s communications networks for a longer period. The Commission stands ready to assist Congress in any efforts to fully fund the Reimbursement Program and support the removal of insecure equipment from our communications infrastructure. I hope this information is helpful to you. I look forward to continuing to work with you to achieve the goals of the Reimbursement Program and the essential task of securing our Nation’s communications networks. Sincerely, Jessica Rosenworcel 3 47 CFR § 1.50004(g)(1) (“Within one year of the approval of its Reimbursement Program application, a recipient must file at least one reimbursement claim.”); see also Wireline Competition Bureau Reminds Secure and Trusted Communications Networks Reimbursement Program Recipients of the July 17, 2023 Deadline to File an Initial Reimbursement Claim, WC Docket No. 18-89, Public Notice, DA 23-445 (WCB May 24, 2023). 4 47 U.S.C. § 1603(d)(6)(A). 5 47 U.S.C. § 1603(d)(6)(C). Federal Communications Commission Washington, D.C. 20554 October 10, 2023 The Honorable Steny Hoyer Ranking Member Subcommittee on Financial Services and General Government Committee on Appropriations U.S. House of Representatives 1036 Longworth House Office Building Washington, DC 20515 Dear Ranking Member Hoyer: In the Secure and Trusted Communications Networks Act, Congress directed the Federal Communications Commission to establish the Secure and Trusted Communications Networks Reimbursement Program to advance national security by supporting the removal, replacement, and disposal of communications equipment and services produced or provided by Huawei Technologies Company or ZTE Corporation from our Nation’s communications networks. The Commission has made the successful implementation of the Reimbursement Program one of its top priorities. On behalf of the agency, over the last two years I have provided six updates to Congress concerning the Commission’s work to review and process the applications submitted to the Reimbursement Program.1 Today I am writing to continue to keep you informed of the status of our work administering the Reimbursement Program in light of upcoming deadlines under the law. In order to apply for the Reimbursement Program, eligible providers of advanced communications service were required to file applications with the Commission, including a plan for the full removal, replacement, and disposal of the Huawei and ZTE equipment in their networks. The Commission issued decisions approving or denying these applications on July 15, 2022. The approved applications sought approximately $4.98 billion in reasonable costs, reflecting a $3.08 billion shortfall from the current appropriation of $1.9 billion. Because the demand for support exceeded the current appropriation, under the Secure and Trusted Communications Networks Act, the Commission was required to prioritize applicants with two million or fewer customers,2 and even then, the Commission was compelled to prorate funds, providing 39.5 percent of reasonable costs. 1 Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (Feb. 4, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Gary C. Peters, et al. (May 20, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (June 1, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (June 15, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (July 15, 2022); Letter from Jessica Rosenworcel, Chairwoman, Federal Communications Commission, to The Honorable Frank Pallone, Jr., et al. (May 3, 2023). 2 The Commission was also compelled to deny one application from an otherwise eligible applicant because it was in a lower priority tier due to the size of its customer base (between two and ten million customers). Page 2 – The Honorable Steny Hoyer Those applicants approved for funding support in the Reimbursement Program were required to submit at least one reimbursement claim to the agency by July 17, 2023.3 The Secure and Trusted Networks Communications Act requires that Reimbursement Program recipients complete the permanent removal, replacement, and disposal of Huawei and ZTE communications equipment and services in their networks within one year of the first distribution of reimbursement funds to the recipient.4 As of October 2, 2023, reimbursement claim requests have been submitted for 122 of the 126 applications approved for the Reimbursement Program and the Commission has approved distributions of reimbursement funds for 112 of those applications, which now have deadlines to remove all Huawei and ZTE communications equipment and services ranging from October 8, 2023 to September 23, 2024, based on the initial distribution of funds to the recipients. The Commission subsequently received several requests to extend Reimbursement Program recipients’ one-year removal, replacement, and disposal term by six months. The law permits the Commission to provide such six-month extensions if they are “due to no fault of such recipient.”5 Many of the recipients requesting extensions claim they are unable to timely complete this project without full funding. On October 10, 2023, the Wireline Competition Bureau granted several of these extensions for a period of six months, finding that the lack of full funding had slowed their removal, replacement, and disposal processes. It is important to note, however, that the grant of these extensions does not lessen the urgency for a fully funded Reimbursement Program. Indeed, the lack of full funding means that insecure equipment will remain in our Nation’s communications networks for a longer period. The Commission stands ready to assist Congress in any efforts to fully fund the Reimbursement Program and support the removal of insecure equipment from our communications infrastructure. I hope this information is helpful to you. I look forward to continuing to work with you to achieve the goals of the Reimbursement Program and the essential task of securing our Nation’s communications networks. Sincerely, Jessica Rosenworcel 3 47 CFR § 1.50004(g)(1) (“Within one year of the approval of its Reimbursement Program application, a recipient must file at least one reimbursement claim.”); see also Wireline Competition Bureau Reminds Secure and Trusted Communications Networks Reimbursement Program Recipients of the July 17, 2023 Deadline to File an Initial Reimbursement Claim, WC Docket No. 18-89, Public Notice, DA 23-445 (WCB May 24, 2023). 4 47 U.S.C. § 1603(d)(6)(A). 5 47 U.S.C. § 1603(d)(6)(C).