March 2018
News and Updates
Here are some updates from the Texas Telephone Association. View as Webpage
Update from Executive Director Lyn Kamerman
Texas PUC rulemaking advances
As we move into spring, there are several state regulatory proceedings that impact local phone companies in Texas.
 
The Public Utility Commission of Texas on February 27 held a public workshop in Project No. 47669 on implementing reforms to universal service for small local phone service companies in Texas under SB 586, which was approved by the Texas Legislature in 2017. The Texas Telephone Association and the Texas Statewide Telephone Cooperative, Inc. filed the proposed rule known as the Small and Rural Incumbent Local Exchange Carrier Universal Service Plan – or SRILEC USP – with the PUC.
 
During the workshop, Charles Land, a former PUC staff member, as well as representatives from the Texas Cable Association, Comcast, and the Office of Public Utility Counsel asked questions related to the proposal. Questions touched on a variety of issues, including jurisdiction, separations factors for average schedule companies, the inclusion of audited financial statements, the reporting of compensation paid to owners and former owners of investor-owned companies and the complicated issue of capturing federal income tax reductions associated with the Tax Cuts and Jobs Act.
 
TTA and TSTCI will continue to work with the PUC staff and the other interested parties to craft revisions to our proposal to address any relevant issues. PUC staff is expected to adopt a final proposal in fall 2018.
 
Other Texas PUC proceedings include:
 
  • The PUC staff on February 27 issued final recommendations in the application of Blossom Telephone Company in Docket No. 47812 and the application of Community Telephone Company in Docket No. 47813 to recover lost federal universal service support through the Texas Universal Service Fund. Representatives from both companies worked with PUC staff to provide additional information in an effort to reduce potential costly discovery requests. The PUC Staff found Blossom was reasonably projected to lose $158,838 in federal support for 2017 and Community was reasonably projected to lose $179,900 in federal support for 2017. TTA anticipates that the commission will approve Blossom and Community’s applications in the next few months.
 
  • Valley Telephone Cooperative, Inc. on March 6 filed an application to reconcile universal service support for 2015 in Docket No. 48145. In a prior proceeding, Valley projected it would lose $71,589 in federal universal service fund support for 2015 after offsetting revenues associated with local rate increases. After completing a federal cost study in 2017, Valley indicates that it saw unanticipated federal losses of $105,320 in 2015 and seeks additional support to cover the losses.
 
  • A PUC administrative law judge released proposed orders in YK Communications, LTD. (formerly Ganado Telephone Company) and Border to Border Communications, Inc.’s applications in Docket Nos. 47683 and 47745 to recover universal service funds. The proposed orders are scheduled to be heard by the PUC during the March 29 open meeting.
Association News
Legislative Update – John Hubbard and Ian Randolph
In Texas, odd-numbered years are for legislative sessions and even-numbered years are for elections. With all the mailers in mailboxes and an endless onslaught of TV and radio ads, no question we are in an even-numbered year.
 
Elections are about winners and losers and there were some noteworthy takeaways from the March 6 Texas primary election. Primary voting is not over, as some 30 legislative races went to runoffs to be held on May 22.
 
It is noteworthy that voter interest was high this cycle and turnout increased for a gubernatorial election year. Despite very high turnout for the Democratic primary – nearly double from 2014 – Democrats still did not overtake Republican voter turnout statewide.
 
In the Senate, there were some notable races. Sen. Kel Seliger, R-Amarillo, fought off a heated challenge in a three-way primary race to win with 50.4 percent of the vote and avoid a runoff. In the race to replace Sen. Van Taylor, R-Plano, Angela Paxton, wife of Texas Attorney General Ken Paxton, defeated the twin brother of Sen. Don Huffines, R-Dallas. Sen. Bob Hall, R-Canton, held off a tough challenge from Rep. Cindy Burkett, R-Sunnyvale. In the only loss by an incumbent, Sen. Craig Estes. R-Wichita Falls, was soundly defeated by Rep. Pat Fallon, R-Frisco in North Texas.
 
So, there will be four new faces in the Texas Senate next session – Paxton, Fallon and whoever replaces state Sen. Sylvia Garcia, D-Houston, who won the Democratic primary for Congress. In addition, an election will be held for the seat of Sen. Carlos Uresti, D-San Antonio, who recently was convicted of federal fraud charges. There will be no change in the partisan makeup of the Senate and Lt. Governor Patrick added an ally with the election of Fallon.
 
In the Texas House, numerous incumbents survived challenges from candidates backed by Gov. Abbott and or Empower Texans, the conservative special interest group. The governor threw his weight behind campaigns to unseat three incumbent members; Rep. Sarah Davis, R-West University Place, Rep. Lyle Larson, R-San Antonio, and Rep. Wayne Faircloth, R-Galveston. Both Davis and Larson prevailed, and Faircloth lost to Mayes Middleton. Empower Texans targeted 21 races and won only three with another four still in runoffs. One of the seats targeted by Empower Texans was that of Chairman Charlie Geren, the house sponsor of SB 586.  Geren won despite in spite of heavy financial support to unseat him.
 
So, likely winners this primary season were:
  • The Texas House of Representatives: Voters in Texas House races continued to show independence and largely supported moderate pro-business Republicans. This is particularly good news for moderate candidates in the race for the next speaker of the House. Currently, Rep. Phil King, R-Weatherford,, Rep. John Zerwas, R-Richmond, and Rep. Tan Parker, R-Flower Mound, have announced their candidacies. Rep. Four Price, R-Amarillo, and Rep. Chris Paddler-Marshall, are expected to run for speaker as well. These results are particularly good news for Price and Paddie who handily survived after they were targeted by Empower Texas, giving them a measure of invulnerability.

  • West Texas: Despite strong efforts to unseat a number of high-profile West Texans – Sen. Seliger, Rep. Price, Rep. Ken King and Rep. Charlie Geren – all survived challenges.

  • Democrats: Although they made no gains in the Senate, the high primary turnout means Democrats could pick up five or six seats in the Texas House next term. While this will not make a great deal of difference in the partisan makeup of the chamber, it shows some momentum in a non-presidential election year.
   
  • Women: Female candidates in both parties made gains and there likely will be an increase in woman legislators next session.
 
That leaves the losers:

  • Empower Texans: The well-funded conservative interest group spent huge sums of money in several races across the state and were largely ineffective.

As we look toward the upcoming May runoffs and the November general election, no question there will be more fun to come. 
Deadline approaching for TTA Foundation 2018 scholarships
The deadline is just around the corner to apply for the Texas Telephone Association Foundation 2018 scholarships. The deadline to apply is March 30.
 
The Texas Telephone Association Foundation (TTAF), a nonprofit, philanthropic organization founded to help further the understanding of telephony and advance telecommunications as a career choice, each year awards six $2,000 four-year scholarships to Texas students. The TTA scholarship program is made possible by contributions from TTA members and associate members.
 
Since 1992, the TTA Foundation has awarded more than $330,000 in scholarships to Texas students. The deadline to submit applications is March 30. A link to the scholarship application can be found here .
Don’t forget – TCEI-EXPO set for April 3-5
The Texas Communications Expo, Inc. is just around the corner. The Texas Communications Expo Inc. is inviting TTA members to participate in the annual TCEI- EXPO on April 3-5 in Belton, Texas. An estimated 1,100 communications professionals from across the country are expected to attend the event, which will feature exhibitors demonstrating the latest trends in the communications industry and a crawfish boil.
For more information, please visit www.tcei-expo.com .
Mark your calendars – TTA Convention and Product Showcase set for Sept. 9-12
We are continuing to plan for the 2018 TTA Convention and Product Showcase scheduled for Sept. 9-12 at Horseshoe Bay Resort. Look for more details soon.
NTCA recognizes Nortex Communications’ Chris McNamara
NTCA–the Rural Broadband Association – recently recognized Chris McNamara of Nortex Communications during the 2018 Rural Telecom Industry Meeting & EXPO held in Austin.

McNamara, IT network manager of Nortex based in Muenster, received the Key Employee Award for his “extraordinary efforts in helping to expand fiber-based broadband access to 14 schools,” NTCA said in a news release .

“McNamara led efforts to expand service into four new communities, signing up more than 150 new business customers,’’ the NTCA announcement said, adding McNamara is known by his colleagues as the “central solutions architect” for the company’s network infrastructure.

McNamara was one of six rural telecommunications industry leaders recognized for their achievements and service to the industry during the NTCA meeting. A video from the awards ceremony is available here .
In the State and Around the Nation
More changes at the Texas PUC
We are seeing more changes  at the Public Utility Commission of Texas.
The commission on March 20 announced the hiring of John Paul Urban as executive director to replace Brian Lloyd, who recently resigned.

Urban's appointment comes after the resignation earlier this month of Commissioner Brandy Marty Marquez, who announced she will leave her job on April 2, after serving nearly five years on the commission.  

Urban is a former NRG Energy employee. Urban previously served as the PUC’s director of Government Relations from 2011 to 2014 and served as chief of staff for Rep. Wayne Smith.

The PUC in the past year has seen a complete transformation of its leadership, starting with the retirement in April 2017 of former PUC Chairman Donna Nelson, who had served the agency for nearly a decade. Commissioner Kenneth Anderson left the PUC in August when his six-year term expired.
 
DeAnn Walker, former director of regulatory affairs for Houston's CenterPoint Energy, in September was appointed to replace Nelson as chairman and Arthur D'Andrea was appointed to replace Anderson.
 
In announcing Urban’s appointment, the PUC announced a realignment of certain staff members including new titles for Thomas Gleeson as chief operating officer and Stephen Journeay as commission counselor, Office of Policy and Docket Management. As part of the realignment, Journeay will now report directly to the commissioners instead of the executive director. The PUC also has a new communications director, Andrew Barlow.
Texas PUC focusing on municipal access line rates
The Texas PUC on March 8 approved an order in Project No. 24660 adjusting the maximum municipal access line rates for municipal franchise fees. The PUC each year adjusts the maximum municipal franchise fee rates to account for changes in the consumer price index. Municipalities can provide input to the PUC by April 30 on rate plans. The PUC is expected to approve final rates by July 1.
Federal High Cost Universal Broadband reporting guidance
Carriers participating in modernized federal Connect America Fund programs must file deployment data with the Universal Service Administrative Company’s (USAC) High Cost Universal Broadband – or HUBB --reporting portal showing where they are building out mass-market, high-speed Internet service by precise location.

This information includes latitude and longitude coordinates for every location where service is available, and USAC will eventually display this information on a public-facing map to show the impact of Connect America funding on broadband expansion throughout rural America.

This requirement applies to TTA members who elected to receive Alternative Connect America Model (A-CAM) support and those that receive traditional federal support now known as the Connect America Fund.

The FCC’s Wireline Competition Bureau released a Public Notice providing further guidance for those carriers who have subsequently identified errors on their December 31, 2015 FCC Form 477. The WCB indicated that any CAF-BLS recipient that has identified errors in its December 31, 2015 FCC Form 477s must correct their 477. 
FCC moving forward with Connect America Fund Phase II reverse auction
The Federal Communications Commission’s Wireline Competition Bureau on March 2 released a Public Notice with a revised list of census blocks that are eligible for the Connect America Fund Phase II (CAF Phase II) reverse auction. The CAF-II is part of the FCC’s reform and modernization of its universal service support programs. CAF-II will use competitive bidding to support deployment of networks providing both voice and broadband service, potentially allowing potential competitors to win federal universal service support to expand broadband availability to millions more unserved Americans.
 
Under the CAF Phase II reverse auction, the FCC has indicated that it will distribute $1.98 billion over a 10-year period. Bid winners will have an obligation to deploy broadband service within six years. Under CAF Phase II, the minimum geographic area in which bids will be accepted is a census block group. If there are two or more eligible census blocks in a census block group, the winning bidder must deploy broadband service to the locations in all eligible blocks within the census block group. The FCC established a two-step process for those interested in participating in the reverse auction. In the first phase, carriers are obligated to fill out a short form application that is due no later than March 30. Qualified applicants will be allowed to begin bidding in the reverse auction that starts on July 24. Winning bidders will be required to complete a long-form application to become an Eligible Telecommunication Carrier prior to becoming eligible to receive CAF Phase II support.
 
The Rural Broadband Auctions Task Force and the FCC Wireline Competition Bureau on March 8 issued a public notice releasing additional instructions for the auction’s short form application. The instructions are available on the CAF Phase II website . TTA members interested in participating in the auction should review the list of eligible census blocks, the associated reserve price and auction procedures.
Action on FCC Restoring Internet Freedom order
Court action is underway on the Federal Communications Commission’s Restoring Internet Freedom order which reverses the so-called the “net neutrality’’ mandate.
 
The U.S. Judicial Panel on Multidistrict Litigation issued an Order on March 8 announcing that the U.S. Court of Appeals for the Ninth Circuit was selected to consolidate the various appeals of the Restoring Internet Freedom Order. Petitions for review had been filed in both the DC Circuit and the Ninth Circuit court, including by the Benton Foundation , Free Press , Mozilla , the National Hispanic Media Coalition , NTCH , Open Technology Institute at New America , Public Knowledge , Etsy , the Coalition for Internet Openness , the Center For Democracy and Technology , State of New York, et al . and Vimeo in the D.C. Circuit, and the California PUC and County of Santa Clara, California, et al .
In the News
CenturyLink Gains Texas DIR Contract
CenturyLink has been awarded a managed services contract with the State of Texas Department of Information Resources. The win follows a 2013 award that first brought CenturyLink's capabilities to the agencies that procure services through the Texas DIR five years ago. Read more .

Fiber brings faster Internet to Brazoria
BRAZORIA — This small town is well on its way to having one of the fastest internet connections in Brazoria County. Btel, the telecommunications provider that serves a large portion of the county’s West of the Brazos area, announced March 8 it plans to connect 2,900 Brazoria homes to a fiber optic network by Dec. 31. Read more.

Innovative Systems News Release: Pennsylvania Video Provider Converts to Innovative Systems IPTV Middleware
As Forest City PA’s NEP approaches 120 years of providing communication services for North Eastern Pennsylvania, the complexities of the telecommunications business have increased exponentially since the early 1900s. According to NEP’s Network Manager Bob Trusky, one of the key reasons for converting to the IPTV Middleware solution from Innovative Systems was a desire to reduce the number of vendors they troubleshoot with concerning their video network. Read more.

Over 47,500 rural Texas homes and businesses could get access to high speed Internet
Over 47,500 rural homes and businesses in Texas that are currently unserved by high-speed Internet service could get connectivity in the near future. These homes and businesses are in unserved areas of Texas eligible for financial support from the next phase of FCC’s Connect America Fund (CAF), which helps offset the high cost of extending broadband service into rural areas. The FCC will be distributing these funds through an innovative “reverse auction,” which is scheduled to launch on July 24. Read more.

States Get Busy on Broadband
It was a busy broadband day on the state level, with one state Senate pushing for TV white spaces while a House bill in another state would create a broadband deployment grant fund. Read more.


Senate advances rural broadband data bill
The U.S. Senate unanimously backed legislation to tweak how the Federal Communications Commission measures mobile speed and performance in underserved areas. Proponents say  the Rural Wireless Access Act  would establish a "consistent methodology" for the FCC to collect data for the Universal Service Fund or similar programs — and thereby ensure that funds to bolster broadband infrastructure are distributed fairly between urban and rural communities. Read more.

Incumbent telco, cable lobbies ACA, NCTA, US Telecom line up to defend FCC’s net neutrality repeal
As a California court gets ready to hear arguments to reinstate the 2015 net neutrality rules put in place by former FCC Chairman Tom Wheeler, incumbent ISPs and their lobbying groups have filed motions to uphold the net neutrality rules repeal. San Francisco’s 9th Circuit court was recently selected by lottery to hear the case challenging the FCC's ruling last December to reclassify ISPs as information service providers under Title II of the 1934 Communications Act. Read more.

36 U.S. states — representing nearly 70 percent of the country’s population — are fighting the net neutrality repeal
A total of 36 U.S. States are now actively challenging the FCC’s repeal of net neutrality provisions, either through proposed legislation, litigation, executive order, or an outright law. In total, the defiant group represents nearly 70% of the nation’s population. Read more.

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