The FCC has issued a Notice of Proposed Rulemaking (NPRM) that proposes to modify the letter of credit requirements and bank eligibility requirements for certain high-cost support programs. The Universal Service Fund requires competitive support recipients to maintain letters of credit for a sufficient value with a qualifying bank. Recently, fewer banks have qualified for the programs due to their safety rating, making it difficult for providers to obtain program funding.
In an effort to promote deployment, the FCC has proposed changing the rating standard for determining bank eligibility for FCC high-cost programs. The Commission has also proposed lowering the required letter of credit value for providers receiving Rural Digital Opportunity Fund support if those providers can demonstrate, by the end of the second year of support, deployed service to 10 percent of their locations. Lastly, the Commission has proposed to permanently align the Connect America Fund Phase II letter of credit rules with the Rural Digital Opportunity Fund letter of credit rules.
Comments will be due 30 days after the date of publication of the NPRM in the Federal Register.
