Statement of FCC Commissioner Furchtgott-Roth.
Re: Response to FCC Public Notice of June 12 on Schools and Libraries Fund.
Date: June 12, 1998.
Source: Office of Commissioner Furchtgott-Roth.
June 12, 1998
PRESS STATEMENT OF COMMISSIONER FURCHTGOTT-ROTH REGARDING UNIVERSAL SERVICE
By Proceeding Today, The Commission Ignores The Express Will or Congressional Leaders That It Reconsider the Universal Service Program In Its Entirety
Today, the Federal Communications Commission adopts the 1998 and the first half of 1999 collection amounts for universal service, and the Common Carrier Bureau releases a Public Notice announcing the universal service contribution factors for the third quarter of 1998. I dissent from that Order and object to that Notice.
Before stating some of my reasons for objecting, let me make clear that I support the implementation of Section 254 in its entirety, including the schools and library provisions, within the parameters of the law. I am also confident that all of my fellow Commissioners have labored earnestly in attempting to implement these provisions. But sound intentions are not always enough. I am fearful that, by today's actions, this Commission has jeopardized not only the schools and libraries program, but the entire universal service mandate, and perhaps more.
| 1 Letter from The Honorable John McCain, Chairman, Senate Committee on Commerce; The Honorable Ernest F. Hollings, Ranking Minority Member, Senate Committee on Commerce; The Honorable Tom Bliley, Chairman, House Committee on Commerce; The Honorable John D. Dingell, Ranking Minority Member,, House Committee on Commerce; to The Honorable William Kennard, Chairman, Federal Communications Commission, June 4, 1998. |
With these actions, the Commission defies the bi-partisan Congressional directive that this agency "suspend further collection of funding for its schools and libraries program, and proceed with a rulemaking that implements all universal service programs in a manner that reflects the priorities established by Congress in the telecommunications Act of 1996."1 Senators at Wednesday's hearing encouraged the Commission at least to freeze temporarily this program while the Commission revisits both the substance and the ramp-up period of these new universal service programs. Indeed, in response to Sen. Wyden's (D-Ore.) suggestion that FCC take 6-8 weeks to fix the universal service Program, I stated that I would welcome the opportunity. I had hoped that the Commission would follow Sen. Wyden's counsel to suspend the program and make a public commitment to address the entire universal service dilemma -- including the rural, high-cost issues -- in the next 6-8 weeks. I have been disappointed.
I recognize that some will argue that we must proceed now. But I am not convinced that a minor 6-8 week delay in a new program will cause great harm. Indeed, we have already collected enough money to fund almost all of the demand for telecommunications services for this entire year. As I have written in detail before, I believe there is no statutory basis in Section 254 for federal discounts for internal connections. And, as I have often stated, the primary purpose of Section 254 is to provide support for high-cost, rural areas of America, an issue that has yet to be fully addressed by the Commission.
Moreover, recent reports indicate that many schools will not even be able to spend the money allocated for inside wiring in 1998, even if the discounts were legal. Internal connections create substantial disruption to students, and schools typically have the work done during vacation periods, Because funding commitments cannot be made until sometime in June or July, many schools have realized that they cannot finish the installation of inside wiring before this summer ends. Thus, to minimize disruption, many schools would wait until the spring/summer of 1999 to provide internal connections in any event.
Congressional leaders have demanded that the Commission suspend the schools and libraries program until all aspects of universal service are resolved. It would be irresponsible to issue funding commitments, allow public money to be distributed, or to raise consumers rates -- which is undeniably necessary at least with respect to wireless rates if not overall -- to pay for these programs before Congressional concerns can be fully addressed. The American consumer will be left to pay the bill with rates that are not as low as possible.
Statement of FCC Commissioner Kennard.
Re: Response to FCC Public Notice of June 12 on Schools and Libraries Fund.
Date: June 12, 1998.
Source: FCC.
| NEWS | June 12, 1998 |
STATEMENT OF CHAIRMAN WILLIAM KENNARD ON FCC ADOPTION OF
PLAN TO REFORM SCHOOLS AND LIBRARIES DISCOUNT PROCEDURES
Today the Commission took a number of actions to put the e-rate initiative on solid footing before a single dime is spent. We've made sure the neediest kids get Internet access, we've reorganized the administrative structure by combining two corporations into one, we've reduced overhead by lowering CEO salaries. I'm also proposing "truth-in-billing" to require carriers to tell consumers the whole truth about their phone bill. The truth is, long-distance rates have never been lower and the e-rate will not cause any consumer's rates to increase. Today's actions respond as fully as possible to the concerns voiced by Congress, yet reflect my unshakable commitment to implementing the Telecommunications Act's directive that schools, libraries, and rural health centers are afforded access to communications.
My grandfather made sure my father received an education, and that resulted in education and opportunities for me. The e-rate is about providing our children an education that will unlock opportunities in the future.
This Nation has an obligation to make sure our neediest kids have an on-ramp to the
network that leads to tomorrow's opportunities.
I hope our actions will allow us to get past the controversies, distractions, and false
choices, and focus on the promise that communications holds for education, for
communities, and for rural health care.
Statement of FCC Commissioner Ness.
Re: Response to FCC Public Notice of June 12 on Schools and Libraries Fund.
Date: June 12, 1998.
Source: FCC.
| NEWS | June 12, 1998 |
Press Statement of Commissioner Susan Ness
Re: Fifth Order on Reconsideration and Fourth Report and Order, Federal-State Joint Board
on Universal Service, CC Docket No. 96-45.
Today's decision is a difficult one for me. I am respectful of the concerns that have been expressed by several of the leading Members of the United States Congress concerning the FCC's plans to provide universal service support for schools, libraries, and rural health care. We have taken their concerns to heart. I am also respectful of the dozens of Senators and scores of Representatives who have urged us not to jeopardize the interests of the thousands of institutions that are now prepared to move forward. I share these Members' commitment to the vision embodied in the Snowe-Rockefeller-Exon-Kerrey provisions of the Telecommunications Act of 1996.
I believe these competing concerns can be accommodated, and I am determined to do everything in my power to safeguard these programs, while squarely addressing the concerns of the critics. Today's decision is but one step in that process. Ensuring the completeness and accuracy of consumer bills will be another.
I embrace the universal service provisions of the Communications Act. For over two years, the FCC has worked diligently with our partners, the state commissions, to promote all of the universal service. High-cost support is in place, and it is working. Low-income support is in place, and it is working. The school, library, and rural health care systems are in place, and ready to begin working. And all of the funds for all of these efforts have been collected at the same time that aggregate costs for long distance carriers -- who carry about 90 percent of the burden -- were decreased.
On July 1, the costs of universal service for long distance companies will not rise by a single cent. At the same time, the prices the long distance companies pay for "interstate access services" will decline by approximately $800 million (in addition to last year's decline of $1.7 billion). In a competitive market, lower costs means lower prices. Consumers have every reason to expect them -- and to demand them. But let's not begrudge the fraction of one percent that is going to a brighter future.
Statement of FCC Commissioner Powell.
Re: Response to FCC Public Notice of June 12 on Schools and Libraries Fund.
Date: June 12, 1998.
Source: FCC.
June 12, 1998
PRESS STATEMENT OF COMMISSIONER MICHAEL K. POWELL, DISSENTING IN PART
Re: Fifth Order on Reconsideration and Fourth Report and Order, Federal-State Joint Board
on Universal Service, CC Docket No. 96-45.
Today, the Commission takes an important step in its implementation of the universal service mandates of the Telecommunications Act of 1996, which it is our duty to implement. I fully recognize the benefits of the programs that are the subject of this Order. In particular, I recognize the importance of access to advanced services to the education of the next generation of Americans.
Nevertheless, I will issue a separate statement dissenting in part from this Order because I believe the Commission should, in particular, suspend collections for the Schools and Libraries program temporarily in order to resolve the funding questions that loom over all aspects of universal service -- including the new high cost support mechanism -- simultaneously in an integrated proceeding. The Act requires that we balance the interests of several constituencies in addition to those represented by these programs in our implementation of universal service, just as the Act requires that we balance the goals of universal service against the other procompetitive, deregulatory provisions of the Act. In sum, I would strike a different balance than that struck by the majority. Yet I support the general direction of the changes made in this Order regarding the scope and timing for funding the Schools and Libraries program, in particular, and I commend the majority for having the courage to institute these changes.
Statement of FCC Commissioner Tristani.
Re: Response to FCC Public Notice of June 12 on Schools and Libraries Fund.
Date: June 12, 1998.
Source: FCC.
NEWS June 12, 1998
Separate Statement of Commissioner Gloria Tristani
Re: Federal-State Joint Board on Universal Service, CC Docket No. 96-45
I strongly support the goals of the schools and libraries program. It is with reluctance that I support today's decision to scale back funding for the program. I do so because I believe it fairly reflect the competing concerns that face us at this point.
It has become all too common in Washington to substitute the word "investment" for "spending." With respect to some types of expenditures, the word "investment" is truly misplaced, but I believe "investment" elegantly captures the nature of the schools and libraries program. The nation's economy is increasingly dependent on the technological competence of its workforce. A fully functioning program is a golden opportunity to help prepare our children for the global, information technology economy. When we make a decision to slow funding for schools and libraries program, as we do today, we decide that fewer children will experience the world of the Internet for the first time. We also decide that, in the near future, fewer young adults entering the workforce will be capable of performing jobs that American companies are desperate to fill. The schools and libraries program is competition policy, and while it will not singlehandedly create a workforce capable of growing our economy in the face of foreign competitors, it is an important step in that direction.
I recognize and respect Congress's wishes with regard to the universal service provisions. Congress speaks for the American people, who are the ultimate source of the FCC's authority. Many members of Congress have told the Commission that they intended high cost support to be the centerpiece of the universal service provisions of the Telecommunications Act of 1996. I do not disagree with that point. I take this opportunity to personally reaffirm my commitment to a high cost mechanism that complies with the letter and spirit of the universal service provisions of the 1996 Act. Coming from New Mexico, I have seen first hand the need for high cost support for rural areas. A new high cost mechanism that failed to "preserve and advance universal service" would be flatly at odds with both the Act and the unambiguous will of Congress. Thus, as a matter of both personal belief, as well as professional duty, I am firmly committed to creating a new system of high cost support that keeps local telephone service affordable in rural areas.
Some have argued that the FCC should freeze the schools and libraries program until we complete our work on a new mechanism for supporting local telephone rates in high cost areas. The argument is that the FCC has simply misunderstood Congress's relative priorities as between schools and libraries support and high cost support. I understand why some would feel that way. However, I do not believe we should postpone resolution of the schools and libraries program simply because we have not completed our work on the far more complex high cost plan. Thus, I would reiterate that my support for implementing the schools and libraries program does not in any way affect my commitment to creating a high cost support system that fully complies with section 254 of the Act.
Implementing the schools and libraries portion of the 1996 Act was a very challenging task for the previous Commission, and it continues to present this Commission with difficult choices. But replacing the old system of high cost subsidies with explicit support flows is proving to be a far more difficult task. For one thing, any new mechanism is bound to affect the amounts currently paid and received by individual carriers and individual states. Many carriers and state commissions have devoted enormous resources to devising proposals that seek to accommodate the competing concerns. While some of these proposals are quitedifferent, each has components that satisfy important objectives.
In addition, the new high cost mechanism is particularly important because it will directly affect Congress's goal of bringing consumers competitive choices in telecommunications markets. A system of explicit support that results in underfunding of high cost areas would, as a practical matter, restrict consumers in those areas to a single choice of provider -- the incumbent. Preserving universal service and promoting competition are the hallmarks of the 1996 Act. They are also two sides of the same coin. Thus, in addition to achieving the critical objective of preserving affordable telephone service, the new system of high cost support adopted by this Commission will go far in determining whether Congress's goal of competition is ever realized for millions of Americans. I view the ongoing struggle to implement the new high cost mechanism not as a lack of commitment on our part but as a sign of our commitment to getting it right with respect to high cost funding for rural areas.
I am also concerned that today's action will cause disruption to the education community. The public is not entitled to assume government policies will never change. The government is constantly adding to, modifying, or eliminating rules and regulations. It does so either because the conditions have changed, or because attitudes have changed even as the underlying conditions remain the same. I see no evidence that the conditions justifying the creation of the schools and libraries program have changed. Today, just as on May 8, 1997, there is no question that children will receive better educations if the immense resources of the Internet are made available to them and their teachers. What has changed is the attitude toward the program because of the realization that achieving this worthy goal will cost money. I welcome a thorough discussion of the extent to which consumers are willing to sacrifice to achieve this goal. I have little doubt that consumers are willing to pay for the schools and libraries program. I only regret that it has taken so long for this fundamental dialogue to occur.
Funding of internal connections has become a key focus of the program because it represents approximately 65 percent of the support requested for 1998. I believe the benefits of the schools and libraries program are critically dependent on funding internal connections. Section 254(h)(1)(B) is about bringing the Internet to students. Students are located in classrooms. Therefore, the Internet connection must be brought to the classrooms. Funding basic telephone service and Internet access service for phone lines in principals' offices will not improve education for students. In the past few months, this point was made clear to me when I visited schools in New Mexico and Puerto Rico. Although a few of the classrooms had computers, none had Internet access. Those visits crystallized for me the importance of inside wiring to the success of the schools and libraries program.
It is regrettable that we are funding internal connections for only the schools eligible for 80 and 90 percent discounts. This means the majority of schools that were eligible for discounts on inside wiring will get nothing. Many of the schools I visited did not fall into the 80 or 90 percent discount range, yet their facilities were quite modest and would not be considered wealthy by any measure. Under our decision today, they will receive no funding to connect their classrooms to the Internet. This is a true loss for those students and teachers.
In the end, I hope today's slowdown of the Schools and Libraries Program will prove to be only a detour for this vital program. I note with optimism that some in Congress are exploring the idea of using money collected through the current excise tax on phone bills to fund the Schools and Libraries Program. I hope this idea receives serious consideration.