Interim Treasury Rules Part 2

On Wednesday I published a blog that discussed my perceptions of the Treasury’s Interim Final Rules for using the $350 billion of funding provided to localities from the American Rescue Plan Act. Today I want to emphasize that blog was based strictly upon the suggested rules from Treasury. It’s important to realize those rules are interim only, and any changes to the rules could have a drastic impact on how the funding can be used for broadband.

Note that Treasury asked five questions related to broadband. These are important enough that I list them:

Question 22: What are the advantages and disadvantages of setting minimum symmetrical download and upload speeds of 100 Mbps? What other minimum standards would be appropriate and why?

Question 23: Would setting such a minimum be impractical for particular types of projects? If so, where and on what basis should those projects be identified? How could such a standard be set while also taking into account the practicality of using this standard in particular types of projects? In addition to topography, geography, and financial factors, what other constraints, if any, are relevant to considering whether an investment is impracticable?

Question 24: What are the advantages and disadvantages of setting a minimum level of service at 100 Mbps download and 20 Mbps upload in projects where it is impracticable to set minimum symmetrical download and upload speeds of 100 Mbps? What are the advantages and disadvantages of setting a scalability requirement in these cases? What other minimum standards would be appropriate and why?

Question 25: What are the advantages and disadvantages of focusing these investments on those without access to a wireline connection that reliably delivers 25 Mbps download by 3 Mbps upload? Would another threshold be appropriate and why?

Question 26: What are the advantages and disadvantages of setting any particular threshold for identifying unserved or underserved areas, minimum speed standards or scalability minimum? Are there other standards that should be set (e.g., latency)? If so, why and how? How can such threshold, standards, or minimum be set in a way that balances the public’s interest in making sure that reliable broadband services meeting the daily needs of all Americans are available throughout the country with the providing recipients flexibility to meet the varied needs of their communities?

I can’t stress enough that having somebody other than the FCC asking these questions is really unusual. While Treasury feels they need to understand these issues better to establish final funding rules, these are largely policy questions. As such, the responses are not easy to describe to Treasury. If the FCC asked these questions I might respond – but in doing so I could take shortcuts in my responses since I could assume that there are many things that the FCC already understands about broadband.

But I couldn’t make that assumption in responding to Treasury. How does one go about explaining the long history and disaster that is the FCC 477 mapping data? The nuances of the FCC data are a major factor in discussing anything related to 25/3 Mbps. How does one convince Treasury the extent to which many ISPs have seemingly fabricated the 477 reporting?

Even more fundamentally, how does one talk about what it means to reliably deliver 25/3 Mbps speeds? Would they believe you if you say that no DSL connection has reliable speeds and that speeds can easily vary by 100% or even far more during an average day? How do you explain how hard it is to measure speeds in the first place – something that’s never been grasped by the FCC. The questions assume that the speed of a product to a single customer can be cleanly defined – and the real-world broadband speeds don’t work like that.

I’m really perplexed by question 23 that asks to describe all of the issues that might define practicality for a given business plan? I write 200-page reports that try to answer that question for clients.

I have to admit that it makes me nervous to have a federal agency that has nothing to do with broadband ask these kinds of questions. Those of us who might be able to answer these questions by spending a day at a whiteboard will not have the time or ability to fully answer in writing the complex questions that Treasury has asked. The answers they are going to get are from the various trade associations that are all going to be heavily biased with a particular industry point of view. After hearing from the cable association, the fixed wireless association, the fiber association, and the big and the small telco associations I can’t imagine how Treasury will reconcile the differences from each of these responses. I can read something from a trade association and quickly tell you what is factual versus pure bosh – but how will Treasury do this?

I have to say that the fact that these questions are still open makes me nervous. Cities, counties, and states are trying to make plans on how to allocate and spend this funding. If this process takes too long, local governments are going to use the money for purposes other than broadband. If the final rules are muddy or too restrictive, localities will also find it easier to pass on using the money for broadband. Even after Treasury gets answers to these questions, I can’t imagine a reasonable way for them to somehow interpret the wide range of responses they’ll get to create a coherent policy – something the FCC has frankly never done well. Ideally, Treasury will adopt what they’ve already written for broadband and be done with it.

One thought on “Interim Treasury Rules Part 2

  1. Here’s an answer: Let the local community decide what is un/derserved. Go figure! It’s the local community that knows what unserved and underserved means. And they won’t be picking 25/3 as the answer to that question. Particularly not the 3 part. Not after seeing what that means thanks to COVID.

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