**STATEMENT OF**

**COMMISSIONER MICHAEL J. COPPS**

**APPROVING IN PART, CONCURRING IN PART**

 

> ***In the Matter of High-Cost Universal Service Support, WC Docket No.
> 05-337; Federal-State Joint Board on Universal Service, CC Docket No.
> 96-45***

 

Five years ago I dissented to a recommendation by a different
Federal-State Joint Board on Universal Service that concluded advanced
services should not be eligible for Universal Service support and that
broadband, specifically, should not be included in the definition of
Universal Service. Today, the Joint-Board happily reverses course and
finds that broadband does indeed meet the statutory criteria of section
254 for inclusion as a supported service and that it is in the public
interest to do so.  I am enormously pleased to approve of this historic
finding by the Joint Board because it establishes for the first time the
right mission for Universal Service in the 21^st^ century. This may well
be the most important single action a Joint Board has ever taken.

 

Universal Service is a critical pillar of the Telecommunications Act of
1996.  Congress concluded many years ago that a core principle of
federal telecommunications policy is that all Americans, no matter who
they are or where they live, should have access to reasonably comparable
services at reasonably comparable rates.  Congress wisely anticipated
that the definition of Universal Service would evolve and advance over
time. The Joint Board's recommendation to include broadband in the
definition of Universal Service finally puts the program in sync with
the intent of the Act.  

 

I must express disappointment, however, that once the initial decision
to include broadband was made, councils of caution found their way to
the fore.  Instead of bold recommendations to implement our historic
decision, the Joint Board only suggests that \$300 million of federal
dollars be dedicated to this challenge. And none of this would be new
money, but rather a mere reshuffling of dollars among different pots.

 

That's like fighting a bear with a fly swatter.  Bringing broadband to
the far corners of the nation is the central infrastructure challenge
our country confronts right now.  It is no different than the challenges
previous generations of Americans faced to build the essential
infrastructures of ***their*** times---the roads, turnpikes, bridges,
canals, railroads and highways of centuries past.  Broadband is ***our
generation's*** infrastructure challenge, but we have fallen behind
other nations in getting high-speed services out to our people.  We have
put ourselves in an untenable competitive position by denying the tools
of high-speed opportunity to most Americans.  Our challenge, then, is to
think, plan and act boldly.  I am disappointed that the Joint Board did
not go farther in its recommendation.         

 

To put it in context, in the mid-1950s Congress looked to complete the
interstate highway system in 10 years at a cost of \$27 billion, which
in 2005 dollars amounts to \$196 billion. While no one is suggesting
that such a level of government support be invested here, I believe the
Joint Board has basically closed its eyes to the level of challenge we
face1.  It should have struck a better balance between our collective
interest in having a sustainable fund for the future and the desire to
ensure that high-speed broadband reaches all Americans. By recommending
a cap of the fund at current levels, the Board cripples the ability of
USF to support broadband in a credible manner. Nonetheless, today's
recommendation to include broadband ***is*** important in and of
itself.  It's more than a small step forward, but it's not the giant
leap for mankind that we need.

 

With regard to comprehensive reform, I believe there are a variety of
ways to promote Universal Service and at the same time ensure the
sustainability and integrity of the fund.  I continue to believe that
much would be accomplished if the Commission were to include broadband
on both the distribution ***and*** contribution side of the ledger;
eliminate the Identical Support rule; and increase its oversight and
auditing of the high-cost fund.  Additionally, Congressional
authorization to permit the assessment of Universal Service
contributions on ***intrastate*** as well as interstate revenue would be
a valuable tool for supporting broadband.  Today the Joint Board makes
an assortment of recommendations of its own. Some I agree with, some I
do not, and some merit further discussion.  For example, the Joint Board
recommends three funds that are tailored to supporting the missions of
voice, mobility and broadband. This seems a creative and reasonable
approach. The Joint Board also recommends the elimination of the
Identical Support rule, places renewed emphasis on the federal-state
partnership in administering the Fund, and suggests that the FCC's
current definition of broadband is antiquated.  I agree with all of
these decisions.

 

At the other end of the spectrum, the Joint Board focuses almost
exclusively on supporting unserved areas, without sufficiently taking
into account the fact that there are many underserved areas of the
country where residents receive little service and, very often, service
at levels that are the laughing stock of the rest of the world.  The
Joint Board also concludes that reverse auctions may be the appropriate
method for distributing funds, despite the many unanswered questions
regarding such a bidding approach on quality of service and provider of
last resort obligations, not to mention many other concerns that have
been raised about this type of bidding.  

 

I concur in part because of the concerns I have enumerated here, plus
others that I will discuss more fully during the pendency of these
recommendations before the FCC. But it is time to get on with fixing
Universal Service.  While I have made clear that I do not agree with all
of the recommendations that have been made, it is crucial to get a Joint
Board recommendation to the Commission.  This alone is a signal
accomplishment, one many years in the making, and one that I have pushed
for since becoming a Joint Board member.  At least and at last we have
tackled many of the issues, charted a direction for the future, and
moved a recommendation to the Commission for follow-through action.
While we may have been deflected from our important work for a time by
disputes over a CETC cap and reverse auctions, in the end we decided to
act in a more appropriately comprehensive fashion. 

 

A new chapter begins now.  I hope the FCC will deal with this
recommendation expeditiously and comprehensively.  This is no place for
piecemeal actions.  We need to think expansively and creatively about
implementing the path-breaking broadband decision that has now been
presented to us. This country desperately needs a comprehensive
broadband strategy.  The Joint Board recommendation provides the
opportunity for the FCC to move toward such a strategy, working with our
own rules and making suggestions to Congress in those areas where
legislative action may be required to ensure such a strategy.   

I wish to thank my Joint Board colleagues for their hard work on this
proceeding. Chairwoman Tate and Chairman Baum should take merited pride
in actually sending a recommendation forward.  All of my state
colleagues worked with tireless energy and determination to get this job
done, and their expertise, experience and vision make today's action
possible.  The Commission and the country are fortunate to have such
people to call upon.  The Joint Board's staff worked long and hard to
bring this recommendation to fruition, and their creativity and
perseverance often made the critical difference.  A final bow to our
recently-retired colleague, Billy Jack Gregg, who stayed long enough to
get us on-course.  His ability to see both the forest and the trees of
Universal Service is perhaps unmatched, and his imprint is writ large in
our recommendation to bring Universal Service into the twenty-first
century.