May 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 implementing Senate Bill 586 advances
The Public Utility Commission of Texas rulemaking implementing small company state universal service reform in Project No. 47669 continues to move forward.
 
TTA is working with the commission staff and industry stakeholders on the draft rule and we anticipate the commissioners will consider a proposed rule for publication at the May 25 open meeting. Under this timeline, it is possible that formal rulemaking comments will be due in early July with reply comments due in mid-July. Commissioners could potentially consider the final rule as soon as August.
 
If the commission approves the new rule this summer, it is possible that local phone companies will be able to elect the new universal service support mechanism and file enhanced earnings monitoring reports in October. In anticipation of new reporting obligations, TTA encourages member companies to being collecting the additional data that will be required under the enhanced reporting structure.
 
On a related matter, on May 2 the PUC approved TTA and TSTCI’s joint waiver request in Docket No. 48204 seeking to delay the filing deadline for the 2017 Earnings Monitoring Reports (EMRs). TTA members traditional earnings monitoring reports are due December 15. 
Association News
Legislative Update – John Hubbard and Ian Randolph
As we enter the summer months, we would like to give you a short roundup of some of the latest news in politics and the Texas Legislature.
 
The 86 th Texas Legislature when it convenes in January will face some difficult budgetary issues, from funding Hurricane Harvey recovery to school finance to infrastructure issues. However, some state number crunchers are saying that the projected budget shortfall may not be quite as large as expected. There is a growing belief among some Capitol observers that recovery from Hurricane Harvey might have heated the Texas economy and will increase sales revenue to the state. In addition, recent increases in oil and natural gas prices could have a positive effect on the state budget. However, there is not to be expected to be much discretionary funding in the budget and legislators will not have a surplus.
 
Speaking of the budget, this is a busy time for state agencies. Typically, state agencies are expected to submit their wish lists for the 2020-2021 biennial budget in June. These wish lists – or Legislation Appropriations Requests (LARs) – are submitted to the Legislative Budget Board (LBB), the Senate Committee on Finance, and the House Committee on Appropriations in June. These requests provide an outline of state agency funding requirements in the two-year budget cycle, including how many new employees will be needed and funding for programs. As agencies come up with their wish lists, there is sure to be plenty of Pepto Bismol going around at the various agencies.
 
Meanwhile, key committees continue to meet. Many interim committees of the Texas Senate and House of Representatives are holding hearings to wrap things up before summer. While many committees will continue to meet to develop committee recommendations before the Legislature convenes in January, many committees have begun to develop reports with recommendations.
 
The Texas Commission on School Finance has been meeting regularly since January to develop recommendations to the Legislature on updating the system Texas uses to fund public schools. The committee, chaired by former Texas Supreme Court Justice Scott Brister, is made up of three senators, three House members, and representatives from traditional school districts, charter schools and the business community. The committee is charged with making recommendations for improvements to the current public school finance system or for new methods of financing public schools. 
 
Meanwhile, the race to replace House Speaker Joe Straus continues to simmer., Currently, there are four declared candidates running for speaker of the House: Rep. Phil King, R-Weatherford; Rep. John Zerwas, R-Richmond; Rep. Tan Parker, R-Flower Mound; and Rep. Eric Johnson, D-Dallas. As the House speaker is chosen by a vote of the members of the House and Republicans hold the majority, it is all but assured that a Republican will be the next speaker. While Democrats may have a say in the ultimate coalition that selects a speaker, the next speaker will not be a Democrat. As is often the case, the race may be won by a House member who has not already declared as a candidate and could be “drafted’’ by House colleagues. Some of the members most often being mentioned as potential speaker candidates include: Rep. Four Price, R-Amarillo; Rep. Todd Hunter, R-Corpus Christ;, Rep. Travis Clardy, R-Nacogdoches; Rep. Trent Ashby, R-Lufkin; Rep. Drew Darby, R-San Angelo; and Rep. Chris Paddie, R-Marshall. The selection of the next speaker will be one of the deciding moments in the next session of the Legislature as it will set the tone. But, for now, it is too early to place your bets.
TTA Foundation awards $48,000 in scholarships
The Texas Telephone Association recently awarded $48,000 in four-year scholarships to Texas high school students entering college in fall 2018.

The foundation awarded six four-year scholarships of $2000 a year to students entering college for the 2018-2019 school year.
 
Students receiving scholarships include:
  • Ethan Tullos of Lovelady who is planning to attend Texas A&M University and major in engineering;
  • Jaime Martinez of El Paso who is planning to attend the University of Texas at Austin and major in business management;
  • Rachel Denman of Hamilton who is planning to attend University of Texas at Dallas and major in computer networking;
  • Callie Thornton of Claude who is planning to attend Texas Tech University and major in accounting;
  • Caroline Guerra of Fort Worth who is planning to attend the University of Texas at Austin and major in architecture;
  • Wesley Sanders of Lexington who is planning to attend Texas A&M University and major in business.

Since 1992, the TTA Foundation has awarded more than $330,000 in scholarships to Texas students. The foundation is a non-profit, philanthropic organization founded to help further the understanding of telephony and advance telecommunications as a career choice.
 
To be eligible for a TTA Foundation scholarship, students must have achieved a cumulative grade point average of 3.0 or higher and be planning to attend a Texas college or university in fall 2018.
 
The TTA scholarship program is made possible by contributions from TTA members and associate members.
TTA taking nominations for Associate of the Year for 2018
The Texas Telephone Association is accepting nominations for the TTA Associate of the Year award for 2018. The winner will be announced at the TTA  Convention and Product Showcase scheduled for Sept. 9-12.
 
The award, created in 1999, recognizes exceptional service and contributions by an individual associate member to the Texas Telephone Association in a given year or a single outstanding accomplishment of direct benefit to the telephone industry and the association.
 
This year we are expanding this award to include a community focus. If you have a member of your team that has made an impact on the industry or in their community please let us know in 500 words or less why you would like to nominate them.
 
Please submit your nominations to joannkam@tta.org by July 15.
Plans shaping up for 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. The Dagnabbit Band is scheduled to play during the dinner Tuesday evening. A sampling of their music can be found here .
Member Spotlight
West Texas Rural Telephone Cooperative deploys fiber, advanced services
With an eye on the future, West Texas Rural Telephone Cooperative has been rapidly deploying fiber networks to serve a diverse customer base of businesses and consumers in the Texas Panhandle.

West Texas Rural Telephone Cooperative – or WTRT – currently serves a vast 2,300-square-mile area spanning Deaf Smith and Parmer Counties and portions of Oldham, Castro and Bailey counties.

We have less than one person per square mile,’’ said Amy Linzey, chief executive officer of West Texas Rural Telephone Cooperative.

WTRT, with about 55 employees, provides high-speed Internet, TV, broadband, and voice communications services to consumers and a mix of business customers including state, federal and local government agencies, school districts, dairies, feedlots, meat packing plants, international corporate customers and large industrial users. Through WTRT’s subsidiary, WT Services , the company provides voice communications, broadband internet, two-way radio services, computer services and security services.

“We are a growing, thriving, evolving and energetic company,’’ Linzey said.
When Linzey assumed the helm of WTRT in 2012, the cooperative was facing financial and technological challenges as well as changes within the industry.

Under her watch, the cooperative has seen change and growth with widespread upgrades to the network – including voice, video and high-speed broadband – to serve the growing demands of consumers and businesses.

“One of the things that had become really obvious to me was I had to upgrade nearly every piece of network,’’ Linzey said.

Since 2012, WTRT has invested some $16 million in deploying fiber and technology upgrades. WTRT has installed more than 315 miles – or 1.6 million feet – of fiber throughout the cooperative service area. When the fiber project is completed, WTRT will have installed nearly 1,000 miles of fiber.

Like many telephone cooperatives, West Texas Rural Telephone Cooperative has a long history of providing a lifeline to rural consumers through voice communications services. WTRT was formed in 1950 after the large commercial telephone companies declined to offer service to the area because of the massive capital investment required to serve such sparsely populated rural communities as well as farms and ranches.

WTRT traces its roots to the passage of the Rural Telephone Act in 1949 which provided low-interest loans from the Rural Electrification Administration (now the Rural Utilities Service under the U.S. Department of Agriculture). Just as the administration had helped illuminate and power rural United States, the availability of low-interest loans led to a new era of growth for rural telecommunications with the availability of quality telephone service to improve the quality of life of rural Texans.

WTRT today supports local communities. Each year, WTRT and WT Services awards about $10,000 in scholarships to local high school students as well as cash and in-kind charitable donations to local communities.

As WTRT deploys new networks and technologies, Linzey continues to listen closely to the demands of consumer and business customers.

“We don’t hold on to the old ways of thinking. We’ve come a long way in six years,’’ Linzey said.

Looking forward, Linzey said rural telecommunications providers must plan for the demands of the future. Demand for high-speed Internet access is growing exponentially’ to support streaming video and other applications, Linzey said.

“The federal Telecommunications Act of 1996 was put in place before the big demand for bandwidth,’’ she said. “Our industry is facing a huge disruption from competition and rural companies need to prepare for it.”
In the State and Around the Nation
CenturyLink awards technology grants across Texas, United States
CenturyLink, Inc . is awarding $1.4 million in technology grants nationwide, including seven projects in Texas.

“CenturyLink recognizes the importance of introducing young people to science, technology, engineering and math, or STEM, concepts to better prepare them for successful careers,” said Sondra Smith, CenturyLink director of corporate social responsibility. “STEM competencies help prepare students to be critical thinkers, persevere through challenges to achieve success, communicate and collaborate across real and perceived barriers, and solve complex problems.”

The Teachers and Technology program awards grants of up to $5,000 for school projects in CenturyLink’s local service and corporate locations on behalf of pre-Kindergarten through twelfth grade teachers who have developed plans to innovatively implement technology in their classrooms.

Texas projects range from video to virtual reality to podcasting. The project grants include: $4999.80 to Bridgeport Intermediate School in Bridgeport Texas; $4,457.00 to Lakeview Elementary in Gun Barrel City; $9675.90 for two projects at Atascocita High School in Humble; $3,650 to Timbers Elementary School in Humble; $4,999 to Bens Branch Elementary in Porter; $800 to Robert L. Crippen Elementary in Porter.

Additional details and a complete list of awards can be found here .
FCC Chairman Pai Issues Statement on USF budget cuts for regional local phone companies
Federal Communications Commission Chairman Ajit Pai on April 27 issued a  statement on projected cuts in Universal Service Fund budget cuts.
 
The Universal Service Administrative Company (USAC) has announced that the high-cost USF budget control mechanism adopted in 2016 will cut universal service support for small, rural carriers by 15.52 percent over the course of the next year. “The prior Administration’s budget control mechanism has created constant uncertainty for small, rural carriers, endangering their ability to make long-term investment decisions to bring high-speed broadband to the millions of Americans who still lack it,” Pai said.
 
Earlier this year the FCC allocated $180 million to small, rural carriers as a stop-gap measure to avert budget cuts for the current funding year and has issued a Further Notice of Proposed Rulemaking to look at the budget control mechanism and other potential rate-of-return reforms.
Texas PUC Opens to examine intercarrier compensation reform
In an ongoing move toward bill-and-keep intercarrier compensation reform, the Public Utility Commission of Texas has opened two new projects associated with reductions in intrastate switched access rates. 
 
The Federal Communications Commission, in Order 1-161 (FCC 11-161), adopted a transitional intercarrier compensation restructuring framework for both intrastate and interstate telecommunications traffic, which will ultimately result in bill and keep. As part of the intercarrier compensation restructuring, the FCC directed reductions for rate-of-return carriers and certain competitive local exchange carriers.
 
Project No. 48345 was established for rate-of-return carriers and competitive local exchange carriers serving rate-of-return carrier service areas to file compliance tariffs. In addition, the PUC opened Project No. 48346 for compliance filings from price cap carriers and competitive local exchange carriers serving price cap service areas.
 
TTA member companies should submit any compliance tariffs to the PUC no later than July 3.
U.S. Senate backs effort to restore “net neutrality’’ rules
The U.S. Senate approved a resolution on May 16 to nullify the Federal Communications Commission's so-called “net neutrality” rollback known as the Order to Restore Internet Freedom.

Several national telecommunications industry groups weighed in on the Senate action.

Jonathan Spalter, president and CEO of U.S.Telecom, said : “This vote throws into reverse our shared goal of maintaining an open, thriving internet. Consumers want permanent, comprehensive online protections, not half measures or election year posturing from our representatives in Congress. While we are disappointed by this vote, broadband providers remain committed to safeguarding the digital lives of consumers and advancing bipartisan legislation that codifies net neutrality principles across the online world.”
FCC offers revised A-CAM support
On May 7, the FCC released a Public Notice announcing revised Alternative Connect America Cost Model (A-CAM) support to electing carriers in an effort to expand rural broadband service.
 
The FCC pledged additional funding for the A-CAM support program and eligible carriers have until June 21 to accept the revised support and the increased broadband deployment obligations. Companies that do not accept the additional support will continue to receive their current A-CAM funding with no revisions to buildout obligations.
FCC releases CAF Phase II auction public notice
The Federal Communications Commission on May 14 released a Public Notice related to the Connect America Fund Phase II Auction announcing it had received 47 carriers complete short form applications and 230 incomplete applications were . 
 
The auction, which is scheduled to begin on July 24, will award up to $1.98 billion over 10 years to service providers committing to offer voice and broadband services to fixed locations in unserved high-cost areas.
 
The FCC identified application deficiencies and indicated that it will send letters to each of the applicants identifying any deficiencies in the applications. Companies with applications determined to be deficient have until June 5 to file corrected applications.
In the News
The Senate approved a resolution to nullify the Federal Communications Commission's net neutrality rollback, dealing a symbolic blow to the FCC's new rule that remains on track to take effect next month. Read more.

NPR
City council took a baby step toward ensuring San Antonians have access to a free and open Internet — a concept techies refer to as "net neutrality." Council's governance committee authorized further discussion of Councilman Manny Pelaez's proposal to require Internet providers that do business with the city not to block or prioritize traffic on their networks. The plan also could allow the city to penalize providers that do so while serving consumers. Read more. 
U.S. Rep. Mac Thornberry said getting broadband to go the “middle mile” for rural communities is crucial to keeping North Texas viable in the decades to come. Read more.

The FCC has a lot on its agenda for its next monthly meeting – including three items involving rural telecom issues. The FCC rural telecom issues pertain to rural carrier contributions to the Universal Service Fund (USF), potential access charge rule changes and a possible reversal of certain requirements for carriers transitioning from TDM-based offerings to IP-based alternatives. Read more.

The Senate Commerce Committee has by voice vote favorably reported S. 2418, the  Rural Reasonable and Comparable Wireless Access Act of 2018  to the full Senate for a vote. Read more.

(Opinion-Editorial from Tom Ferree, chairman and CEO of Connected Nation) The internet is no longer a luxury. Its expansion into rural America is as important today as the expansion of electricity was in the 1930s. To be left out of a digital world is to be left out of the opportunity for better jobs, education, and healthcare. Read more.

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