Carriers Urge FCC to Close $110 Million Annual Broadband A-CAM Funding Gap

Letters from rural carriers have been pouring into the Federal Communications Commission to urge the commission to close the broadband Alternative Connect America Cost Model (A-CAM) funding gap before the end of 2017. It was just about a year ago that more carriers than expected chose to participate in the A-CAM broadband program, which will pay part of a carrier’s costs to bring broadband to unserved areas based on a cost model. Carriers had the choice of moving to the A-CAM program or remaining on the traditional high-cost Universal Service Fund (USF) program, which pays a portion of carriers’ costs based on embedded costs. Those moving to A-CAM funding also had to commit to specific broadband deployment goals, which were more aggressive than those for carriers remaining on the traditional program. The higher than anticipated participation in the A-CAM program initially created a budget shortfall of $160 million for A-CAM carriers.  The FCC freed up an additional $50 million from other portions of the USF program to yield a remaining $110 million shortfall. To address this, the commission reduced or delayed broadband deployment targets for A-CAM carriers, but also said it would consider making additional funding available, which would entail broader deployments. Several of the letters sent to the FCC recently noted that when carriers accepted A-CAM support, they committed to deploying broadband to a specific number of additional locations if further funding were made available by December 31, 2017 – just over a week away. Some of the letters also note that if the carriers receive additional funding now, they will be able to design their network upgrades in the most efficient manner.