FCC Record, Volume 26, No. 7, Pages 4843 to 5761, March 28 - April 08, 2011 Page: 5,035
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DA 1 1-591
On August 21, 2009, USAC sought guidance from the Commission on how to implement the
Commission's orders imposing these competitive ETC caps. In particular, USAC explains that it
"believes that it is required to implement the orders for AT&T and Alltel company-specific caps
for the time period each respective order was in effect until the date it was superseded ...
because the [competitive ETC] industry-wide cap was effective prospectively and did not state
that it superseded the company-specific caps retroactively.'"6
We agree. The company-specific merger orders imposing interim caps on each company took
effect pursuant to their terms, notwithstanding the fact that it would take some time before
USAC would be able to calculate the adjusted support amounts for each company. Each cap,
imposed as a condition of the Commission's approval of a merger, took effect on the date the
merger was consummated---November 15, 2007 for the AT&T-Dobson merger and November
16, 2007 for the ALLTEL-Atlantis Holdings merger.8 By its terms, the Commission's later
Interim Cap Order superseded the company-specific orders; it did not, however, have any
retroactive effect or nullify the prior orders.' As a result, the company-specific interim caps were
in effect-even if USAC had not at the time implemented them-until the effective date of the
Interim Cap Order, after which the industry-wide interim cap went into effect.
6 USAC Letter at 5. The Wireline Competition Bureau sought comment on the request for guidance. See
Comment Sought on Request for Universal Service Fund Policy Guidance Requested by the Universal Service
Administrative Company. WC Docket Nos. 05-337. 06-122, CC Docket No. 96-45. 24 FCC Red 12093 (2009).
In the ALLTEL-Atlantis Order, the Commission explained that it was "impos[ing] an interim cap on high-cost
competitive ETC support provided to ALLTEL as a condition of this transaction." ALLTEL-Atlantis Order, 22
FCC Rcd at 19521, para. 9 (emphasis added). The order clearly contemplated that the limit on ALLTEL's
universal service support was directly tied to the proposed merger; indeed, ALLTEL, upon learning of the
condition, was free to choose not to consummate the transaction, in which case the condition imposed never would
have been triggered. And there is nothing in the text that would suggest that the limit on competitive ETC support
should be calculated from any other date. Likewise, in the AT&T-Dobson merger, AT&T offered, as a voluntary
commitment, to have a similar condition placed on it. See AT&T-Dobson Order. 22 FCC Red at 20329, para. 71.
The Commission, in language similar to the ALL TEL-Atlantis Order, noted that it was "condition[ingi [approval
of] the transaction on this voluntary commitment." A T&T-Dobson Order, 22 FCC Red at 20330, para. 72.
Nothing in the commitment, or the Commission's order approving the transaction, suggested that the cap should
apply from any date other than the date the transaction was consummated---just like the ALLTEL cap on which
the AT&T cap was modeled.
s See supra note 2.
9Verizon asserts that Commission staff indicated that the ALLTEL-specific interim cap would not be
implemented, and further argues that it would be unfair to require it to disgorge funds when those funds had
already been spent in a manner consistent with universal service fund requirements. See Comments of Verizon
and Verizon Wireless, WC Docket Nos. 05-337 and 06-122, CC Docket No. 96-45 at 17-29 (filed Oct. 28, 2009).
The Commission has repeatedly held that carriers cannot rely on informal staff guidance. See, e.g.,Kojo
Worldwide Corp. San Diego, California, 24 FCC Red 14890, 14894 (2009) (rejecting argument that staff had
promised non-enforcement of provisions of the Act); Applications of Hinton Tel. Co., Memorandum Opinion and
Order on Reconsideration, 10 FCC Rcd 11625. 11637, para. 42 (1995) (noting that when staff advice is contrary to
the Commission's rules, the Commission may enforce its rules despite reliance by the public). See also MAalken
FM Associates v. FCC. 935 F.2d 1313 (D.C. Cir. 1991).
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United States. Federal Communications Commission. FCC Record, Volume 26, No. 7, Pages 4843 to 5761, March 28 - April 08, 2011, book, April 2011; Washington D.C.. (digital.library.unt.edu/ark:/67531/metadc52169/m1/207/: accessed March 22, 2017), University of North Texas Libraries, Digital Library, digital.library.unt.edu; crediting UNT Libraries Government Documents Department.