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Letter to Chairman Genachowski

Letter

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Today, U.S. Senator Charles E. Schumer stood with Orange and Sullivan County business and home owners to call on the Federal Communications Commission (FCC) to relax current standards so that Hudson Valley telecommunications companies can access over $485 million in available funds aimed at deploying broadband across the country. Schumer highlighted that the FCC will only unlock this funding for companies that can provide broadband for less than $775 per household, and only in specific types of areas. Schumer noted that Frontier Communications, the local telecommunications company, did accept some funding in 2012, but was unable to invest it in the Hudson Valley region because of the restrictions in these federal rules. Frontier has stated that it can and would use this FCC funding anywhere in its footprint, including Orange County, to upgrade copper lines to provide broadband. The Commission has allocated the millions in unused funds for this exact purpose, and increased FCC flexibility would give Frontier the opportunity to bring this massively beneficial service to Orange and Sullivan County businesses and homeowners.

"Businesses and homeowners throughout Orange and Sullivan counties should no longer hear a dial-tone when it comes to accessing broadband service," said Senator Schumer. "That is why I'm urging the Federal Communications Commission to increase their flexibility when it comes to allowing telecommunications companies in the Hudson Valley to access over $485 million in unused funding set aside for the deployment of broadband. Reliable high-speed internet access is essential for any business or family to succeed in a global marketplace, and the Federal Communications Commission should remove unnecessary barriers to this unused funding that is collecting cobwebs when it could help ensure broadband access to those who need it most. Frontier Communications can and will use this FCC funding anywhere in its footprint, which includes parts of both Orange and Sullivan Counties to improve broadband service in this region, and help ensure this community is plugged-in to innovations in educational, economic, and cultural development."

"Expanding broadband access is critical to help attract and retain quality companies in Orange County and throughout the Hudson Valley. Senator Schumer's call to the Federal Communications Commission to expand access to millions in funds aimed towards deploying broadband across the country is exactly the kind of leadership we need in Washington. Companies need this type of infrastructure in place to support their growth. Broadband access is as important to companies as highways and bridges. Senator Schumer knows that innovative companies need to have broadband to be competitive. We applaud his efforts in fighting to provide the basic infrastructure that is needed for this century and beyond," said Mike Oates, President and CEO of Hudson Valley Economic Development Corporation.

"In the advertising and public relations industry, transmission of large amounts of data is essential. When I started my agency, our opportunities were limited because broadband was not available here, but widely accessible in larger markets. Since getting broadband, Focus Media has become one of the fastest growing companies in our industry and we are able to do work for companies with an International footprint. It is paramount that the region continues to invest in broadband to ensure we remain competitive to both retain and recruit new business opportunities to Sullivan and Orange County. I believe broadband is essential for job growth and economic development and as more homeowners and businesses have access to broadband our business will continue to grow and prosper," said Josh Sommers, President and CEO of Focus Media, Inc.

Schumer was joined by Orange County Executive Ed Diana; Josh Sommers, CEO of Focus Media; Mike Oates, President of Hudson Valley Economic Development Corporation; Sullivan County Legislators Kitty Vetter and Cora Edwards; Sullivan County IDA Chairman Ira Steingart; and local small business and homeowners with limited access to broadband services. The Connect America Fund (CAF) is part of a larger FCC initiative to make broadband an option for every American. Acknowledging that rural areas can have a particularly tough time gaining access to the internet, the FCC designed the program to provide underserved areas with the technological capability to compete. The CAF was allocated $600 million in its first phase, and there remains $485 million sitting unused. Schumer highlighted that a major reason for this unused funding is due to the strict regulations related to which telecommunication companies can utilize the funding, such as the fact that the company must be able to provide broadband for less than $775 per household. Schumer noted that the costs of implementing broadband technology in rural areas are necessarily higher than in more developed regions, and most cannot meet this requirement. Companies like Frontier Communications have made clear their interest in accessing this funding to upgrade their copper wires in New York State, and by making sensible tweaks to FCC regulations, Frontier could do just that.

Rules like these are so restrictive that it is difficult for carriers to utilize them to deploy broadband in New York and across the country. Schumer today fought for the FCC to improve flexibility in its regulations related to the allocation of this funding, so it can be put to its intended use in deploying broadband to consumers and businesses that need it. Schumer applauded the FCC for their efforts to undertake a massive overhaul of outdated support program in order to facilitate broadband; however he highlighted that the roadblocks placed on this funding are counterproductive to the FCC's initial goal. If the limitations are removed, Frontier Communications, which has thousands of customers in the Hudson Valley, will be able to utilize millions and would intend to install broadband connections for homeowners, businesses, schools and health care providers across Orange County, putting the region on the path to economic and cultural growth. Schumer highlighted, for example, that this money should be permitted for use towards areas that are underserved, rather than those completely without service. Currently, CAF funding can only go towards brand new telecommunication connections, but Schumer argued that the FCC definition should be expanded to include enhancement of broadband service in places like Orange County, not just new deployment. There are Frontier customers in Orange County that technically have broadband access, Schumer noted, but that service is completely inadequate.

Schumer stood at the Orange County Business Accelerator, which is a partnership between Orange County Government and the Orange County Industrial Development Agency. This partnership is aimed at fostering prosperous new businesses in Orange County. The OCBA's purpose is to help businesses extend their reach far beyond the borders of Orange County and simultaneously grow Orange into the most business-friendly environment in the Hudson Valley.

A copy of Sen. Schumer's letter appears below:

Dear Chairman Genachowski:

I write today on a matter that I know is a top priority to you and your colleagues at the Commission: broadband deployment. I commend the FCC for taking on the challenge of bringing the Universal Service Fund into the 21st century by transforming it into the Connect America fund. Especially in non-urban areas, Americans are suffering from inadequate access to reliable broadband service in their homes and businesses; closing this communications gap is critical to allowing our citizens to participate in the modern economy.

I am gratified that the FCC has set aside $600M for the first phase of this transition, CAF-I. I am concerned, however, about the rules the Commission has put into place concerning the deployment of the CAF-I funds. These rules are so restrictive that it is difficult for carriers to utilize them to deploy broadband in my home state of New York; but the problem is not localized to our region. There is clear evidence that more flexibility is needed because the rules have left and will continue to leave significant portions of the money on the table--and therefore not working on the ground to get broadband to the consumers and businesses who need it. It is imperative that the rules regarding the unclaimed $185M from the 2012 CAF projects in addition to the $300M set aside for this year be restructured so that the money can be quickly released for investment in broadband for rural communities.

I agree with the goal the FCC stated in its December 28th Notice of Proposed Rulemaking: the CAF rules should be refined to enable price cap carriers to bring service to unserved and underserved households as quickly as possible. I applaud the FCC for issuing the NPRM, making clear your willingness to reexamine the funding guidelines. In establishing its rules for the second round of CAF projects in 2013, the FCC should ensure enough flexibility that all of the funds remaining from the $600M set aside for this purpose can and will be allocated.

I urge you to take seriously the concerns and comments of the carriers who would like to utilize the CAF-I funds immediately. The ability of non-urban Americans to compete in the digital age depends on access to reliable broadband; by improving CAF, you can and will play a significant role in our economic growth.


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