Telecom Alert:FCC Denies ISP Exclusive Use Petition; Tribal E-Rate NPRM; NTIA Middle-Mile Info Collection; Broadband Grant Tax Bill [Vol. XX, Issue 7]

FCC Denies ISP Exclusive Use Petition

Last week, the FCC issued an Memorandum Opinion and Order dismissing a Petition for Declaratory Ruling filed by Emerald Harbor Communications, LLC (“Emerald Harbor”) alleging that Communications Processing System, Inc. (“CPS”) violated the Commission’s exclusivity rules.  According to the Order, CPS contracts with Cox Communications, Inc. to provide cable, telephone, and Internet service to a condominium complex in Florida.  Emerald Harbor alleges this arrangement gives CPS the exclusive right to provide cable, telephone, and internet service to the complex in violation of the Commission’s rules.  The Commission declined to rule on the merits, finding that federal court actions had already resolved the rights of the interested parties.  In denying the Petition, the Commission also clarified that its rules prohibiting exclusive contracts with MTEs do not apply to private cable operators.  For more information, please contact Jim Baller (baller@khlaw.com; 202.434.4175) or Sean Stokes (stokes@khlaw.com; 202.434.4193).  

Tribal E-Rate NPRM

The FCC will consider a Notice of Proposed Rulemaking at its Open Meeting this Thursday seeking comments on how to increase Tribal applicants’ access to the E-Rate program.  The Commission seeks comment on proposals to increase the maximum discount rate for category two services to 90% and the category two five-year $25,000 funding floor for Tribal applicants.  It also seeks input on ways to simplify the E-Rate cost-allocation rules and to improve the application process.  For more information, please contact Wes Wright (wright@khlaw.com; 202.434.4239) or Tim Doughty (doughty@khlaw.com; 202.434.4271).  

NTIA Middle-Mile Information Collection

Last week, the National Telecommunications and Information Administration (“NTIA”) issued a notice announcing it will submit an information request with the Office of Management and Budget to obtain information from recipients of middle-mile grants to monitor spending habits and activities.  NTIA seeks the information to evaluate the recipients’ progress toward the program’s goals and to prevent potential waste, fraud, or abuse of funds.  The agency seeks to collect the information using the Bi-Annual Performance Report form.  For more information, please contact Jim Baller (baller@khlaw.com; 202.434.4175).  

Broadband Grant Tax Bill Reintroduced

Last week, Senators Mark Warner (D-VA) and Jerry Moran (R-KS) and Representatives Mike Kelly (R-PA) and Jimmy Panetta (D-CA) reintroduced the Broadband Grant Tax Treatment Act (the “Act”) (Vol. XIX, Issue 40). The Act would amend the Internal Revenue Code to ensure that funding for broadband deployment from the Infrastructure Investment and Jobs Act and the American Rescue Plan will not be considered taxable income.  Grants are currently factored into a company’s income and are subject to taxation.  For more information, please contact Casey Lide (lide@khlaw.com; 202.434.4186).  

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