BEFORE THE NEW MEXICO PUBLIC REGULATION … Order... · 17. NMECG, in its response comments,...

BEFORE THE NEW MEXICO PUBLIC REGULATION COMMISSION

IN THE MATTER OF POTENTIAL )AMENDMENTS TO STATE RURAL UNIVERSAL)SERVICE FUND RULE 17.11.10 NMAC, )PURSUANT TO RECENT AMENDMENTS TO )NEW MEXICO RURAL )TELECOMMUNICATIONS ACT )

Case No. 17-00077-UT

FINAL ORDER ADOPTING RULE

THIS MATTER comes before the New Mexico Public Regulation Commission (the

"Commission") pursuant to the Order Issuing Notice of Proposed Rulemaking, issued on August

23, 2017, and upon the record in this rulemaking proceeding.

Whereupon, being duly informed,

THE COMMISSION FINDS AND CONCLUDES:

1. The New Mexico Rural Telecommunications Act (the "RTA") provides for the

establishment and maintenance of a State Rural Universal Service Fund ("SRUSF"). [NMSA

1978, § 63-9H-6 (2013).] Pursuant to the RTA, the Commission adopted Commission Rule

17.11.10 NMAC, concerning the SRUSF. The Commission most recently amended 17.11.10

NMAC in 2016, effective January 1, 2017 (17.11.10 NMAC, as effective from January 1, 2017,

until the effective date of this Order, is hereinafter referred to as "the Rule").

2. During the 2017 New Mexico Legislative session, the Legislature passed Senate

Bill 308 ("SB 308"), which was subsequently signed by the Governor and became effective on

June 16, 2017. SB 308 made extensive changes to NMSA 1978, Section 63-9H-6, of the New

Mexico Rural Telecommunications Act (the "RTA"), which concerns the SRUSF. The major

changes to this section of the RTA include: (1) redefinition of’’universal service"; (2) addition of

a fixed amount, per-connection charge option for funding the SRUSF; (3) addition of a

requirement that no less than sixty percent of support received by eligible telecommunications

carriers be used to deploy and maintain broadband internet access; (4) reformulation of the

methodology for calculating payments to access reduction support recipients; and (5)

establishment of a broadband program.

3. On April 19, 2017, the Commission issued its Initial Order Setting Workshop

Schedule in this matter. The Commission noted that the amendments to the RTA in SB 308

necessitated amendments to the Rule, concerning the SRUSF. Subsequently, the Commission

held several workshops which were well attended by interested persons. The attendees were able

to agree to a number of amendments to the Rule.

4. On August 23, 2017, the issued its Order Issuing Notice of Proposed Rulemaking

(the "NOPR Order"), which included a Proposed Rule and a Notice of Proposed Rulemaking

("NOPR"). The Commission’s Proposed Rule included proposed amendments to conform the

Rule to the changes to the RTA as well as recent regulatory changes by the

Federal Communications Commission ("FCC"). The NOPR noted that the Commission may

consider alternative proposals for amending the Rule to conform to the amended RTA and FCC

regulatory changes as well as proposals for improving the Rule unrelated to the amendments to

the RTA or regulatory changes by the FCC.

5. In accordance with NMSA 1978, Section 8-8-15.B of the Public Regulation

Commission Act (the "PRC Act"), the NOPR was published in the Albuquerque Journal on

September 12, 2017, in the Las Cruces Sun-News on September 17, 2017. In accordance with

Section 8-8-15.B of the PRC Act and Section 14-4-5.2 of the State Rules Act, the NOPR was

published in the New Mexico Register on September 12, 2017. Pursuant to Section 14-4-5.2 of

Final Order Adopting RuleCase No. 17-00077-UT

the State Rules Act, the NOPR was also "provide[d] to the public," as that term is defined in

Section 14.4.2.E of the State Rules Act.

6. Pursuant to the NOPR Order and Section 14-4-5.3.A of the State Rules Act, the

Commission received written initial comments on October 13, 2017, from Staff of the

Telecommunications Bureau of the Commission ("Staff"), the New Mexico Exchange Carriers

Group ("NMECG"), Sacred Wind Communications, Inc. ("Sacred Wind"), Smith Bagley, Inc.

("SBI"), CTIA - The Wireless Association ("CTIA"), Qwest Corporation dba CenturyLink QC

and CenturyTel of the Southwest, Inc. (collectively, "CenturyLink"), Securus Technologies, Inc.

("Securus"), Time Warner Cable Information Services (New Mexico), LLC ("Time Warner"),

and La Jicarita Rural Telephone Cooperative ("La Jicarita"). On October 23, 2017, the

Commission received written reply comments from Staff, NMECG, SBI, CTIA, CenturyLink,

and Time Warner.

7. Pursuant to the NOPR and Section 14-4-5.3.B of the State Rule Act, a public

comment hearing was held in this matter on November 1, 2017. The hearing was presided over

by Chairman Sandy Jones, with Commissioner Patrick Lyons, Commissioner Lynda Lovejoy,

Staff, and various interested persons in attendance. A certified transcript of the public comment

hearing was filed in this docket on November 14, 2017. As the public comment hearing was

relatively brief and covered the same ground as written comments in the record, this Order

discusses only the written comments in this docket.

8. The record in this matter closed on November 13, 2017, pursuant to the NOPR

Order. That same day, La Jicarita filed a Motion for Filing Comments Out of Time.


9. The following discussion, which is grouped by pertinent subject areas within the

Rule and Proposed Rule, includes summaries of relevant comments in the record and the

Commission’s decision with regard to adoption or rejection of any amendments to the Rule.

A. Objective (17.11.10.6 NMAC)

10. The Proposed Rule included the following proposed amendments to the stated

Objective of the SRUSF, at 17.11.10.6 NMAC:

OBJECTIVE: The purpose of this rule is to provide procedures for administering and

implementing the New Mexico state rural universal service fund to maintain and support

universal service o* dab!,,. affor e ~"*~ tho~e public *~’ ........ ;o.,~ ....... ~ ..... a

provided telecommunications carriers that have

been designated as eligible telecommunications carriers, including commercial mobile

radio services carriers as are determined by the commission.

11. The above proposed amendments are consistent with amendments made by SB

308 to Section 63-9H-6.A of the RTA, using the phrase "to maintain and support universal

service" to amend the stated purpose of the SRUSF. CenturyLink, NMECG, and SBI, have filed

comments stating that they support the Proposed Rule as reflecting the agreement of a number of

participants in the workshop proceedings. No comments have been filed in opposition to the

above proposed amendments.

12. The Commission agrees with the above comments of CenturyLink, NMECG, and

SBI. The Commission finds that the above amendments included in the Proposed Rule should be

adopted.

III


B. Definition of"Access Line" (17.11.10.7.A NMAC)

13. The Proposed Rule included the following proposed amendments to the definition

of"Access line," at 17.11.10.7.A NMAC:

"Access line" means a dial tone line, or its functional equivalent, that provides local

exchange service from a carrier’s switching equipment to a point of termination at the

mer’s k i fa t~ ~ ~ ~-~r.~ ~.~ ......... , .... ~ ,~. ....custo networ nter ce e ~onn ..................................... v

switched ........ k, and is not limited to wireline or any other technology; for the purposes

of this rule, an access line does not include official lines, unbundled network

elements/platforms, retail resale, wholesale resale, special access lines and private lines.

14. The above proposed amendments are consistent with the Commission’s carefully

considered definition of "access line" as adopted in Commission Case No. 14-00068’UT, In the

Matter of CenturyLink QC’s Status as a Mid-Size Carrier. A more precise definition of"access

line" than that which exists currently within the Rule should be adopted because "access line" is

a more important term under the amended RTA than under the previous version of the RTA. For

example, the amended Section 63-9H-6.K(1) provides that access reduction support ("ARS")

payments will be adjusted annually by "the annual percentage change in the number of access

lines served" by the ARS recipients.

15. CenturyLink, NMECG, and SBI, have filed comments stating that they support

the Proposed Rule as reflecting the agreement of a number of participants in the workshop

proceedings.

16. Time Warner proposes changes to the Proposed Rule that would "make clear that

[the definition of access line] refers only to retail lines."


17. NMECG, in its response comments, rejects Time Warner’s proposal because,

according to NMECG, Time Warner "does not demonstrate how the Commission’s proposed

definition, already approved by the Commission and utilized on a uniform basis by carriers for

the last several years in reporting access lines, is in any respect unclear or inadequate for SRUSF

use in full compliance with federal and state law."

18. The Commission agrees with the abovementioned comments of NMECG,

CenturyLink, and SBI. The Commission finds that the above amendments included in the

Proposed Rule should be adopted.

C. Definition of"Area underserved by broadband" (17.11.10.7.C NMAC)


of"Area underserved by broadband," at 17.11.10.7.C NMAC:

"Area underserved by broadband" means ~a broadband program proposed

project area where at least 50 percent of households lack access to fixed and mobile

facilities-based broadband service,,,_,,,,,~;*v’~ ~v~,~,,,,,,,, ,~, ....-,-,~,--~,~’;1~ at the minimum broadband

transmission speeds of 410.0 mbps download/1.0 mbps upload. An unOer~erve~ area

,2,~n~i~ereO ",m~er~erved. A household has access to broadband service if the household

can readily subscribe to that service upon request.

20. Certain participants in the workshop proceedings in this matter proposed this

definition as being a reasonable approach to identifying areas that are underserved given

conditions prevailing in many parts of New Mexico. This definition is also designed to be

relatively unrestrictive, so that the Commission may be able to consider a larger number of

petitions under the Broadband Program of 17.11.10.31 NMAC. CenturyLink, NMECG, and


SBI, have filed comments stating that they support the Proposed Rule as reflecting the agreement

of a number of participants in the workshop proceedings. Staff supports this change as reflecting

the agreement of the participants.

21. CTIA argues that the definition of unserved and underserved areas should be

amended to comply with the RTA’s requirement that awards of support be "consistent with

federal universal service programs and be based on the best use of the fund for rural areas of the

state." CTIA contends that these definitions should incorporate the federal standards of

determining eligibility by census block and should disqualify areas served by a carrier offering

fixed broadband service at or above the required minimum transmission speeds.

22. CTIA further argues that broadband program awards should not be granted for

projects for areas in which carriers have already committed to deploy broadband services as a

condition of receiving federal Connect America Fund support. CTIA further argues that carders

should be prevented from "double dipping" by seeking SRUSF funding for projects receiving

Connect America Fund support. However, CTIA acknowledged that the Commission’s

definitions "need not replicate current federal requirements . . ." CTIA notes that federal

standards prohibit any area served by an unsubsidized facilities-based carrier that offers 10 Mbps

download/1 Mbps upload broadband service is ineligible for support.

23. CTIA proposes alternative language for 17.11.10.7.C, in its Initial Comments, that

would read as follows:

"Area underserved by broadband" means a broadband program proposed project area

composed of census blocks in which (i) all ,..r,,,,l,,l,, ....~,~* ,~,,o~1’~* ~,,,~r~ v,~l,~,~-~ ~f households lack

access to fixed a~t~oi4~-facilities-based broadband service from an unsubsidized

competitor at the minimum broadband transmission speeds of 10.0 mbps download/1.0


mbps upload and (ii) no Carrier has been awarded Connect America Fund support to

deploy broadband service. A household has access to fixed facilities-based broadband

service if the household can readily subscribe to that service upon request.

24. Similarly, Time Warner argues that the Commission’s proposed definitions of

"area underserved by broadband" and "area unserved by broadband" would allow the SRUSF to

"overbuild broadband facilities, by including areas served by unsubsidized competitors in the

’broadband proposed project area.’" Time Warner proposes limiting the use of SRUSF subsidies

to only those census blocks that do not have broadband deployment at the bandwidths defined by

the proposed rules. Time Warner also proposes using "broadband deployment date" from Form

477, instead of "market penetration" data to determine which areas are unserved and

underserved. Time Warner further contends that there is "no industry-standard methodology that

would provide the Commission - and, importantly, each of the providers - with confidence that

subscriptions or connections are being reported in a consistent and competitively neutral

manner." Time Warner also raises a concern with regard to the confidentiality of Form 477 data,

arguing that the Commission’s Proposed Rule "raises the potential for federal preemption

regarding any order of disclosure inconsistent with the FCC’s prescribed processes."

25. CTIA, in its reply comments, expresses agreement with Time Warner’s arguments

regarding the definitions of"area underserved by broadband" and "area unserved by broadband."

26. NMECG, in its response comments, notes that these definitions were "discussed

at length during the workshop proceedings and the participants debated, compromised and

ultimately agreed on the definitions appearing in the Proposed Rule." Moreover, the definitions

in the Proposed Rule "were intended by workshop participants to allow the Commission to


consider Broadband Program grant applications targeting the widest reasonable scope of

consumers in the rural areas of New Mexico that have little or no access to broadband service."

27. SBI, in its reply comments, rejects CTIA’s recommendation to align the

definitions of "area underserved by broadband" and "area unserved by broadband" with the

federal definitions. SBI argues that "the federal scheme has been largely ineffective in

increasing both mobile and fixed broadband throughout America."

28. Staff, in its response comments, states that it is not in favor of modifying these

definitions "after they have been extensively negotiated by the parties to the workshops." Staff

concludes that "[e]ach project should be evaluated on its individual facts and merits, and Staff

believes that Commission has the ability under the proposed rule and through other independent

available information whether a broadband project is in the public interest without modification

of the language as suggested by CTIA or Time Warner."

29. The Commission agrees with the abovementioned comments of Staff, NMECG,

CenturyLink, and SBI. In particular, the Commission notes that certain considerations raised by

CTIA and Time Warner may be proper for consideration in proceedings considering applications

within the Broadband Program. However, such considerations should not simply prevent the

Commission from ever considering such applications. As noted above, the workshop

participants generally agreed that the Broadband Program should case a wide net with regard to

applications so as to prevent any worthy application from being blocked from consideration at

the outset. The Commission finds that the above amendments included in the Proposed Rule

should be adopted.

D. Definition of "Area unserved by broadband" ( 17.11.10.7.D NMAC)



of"Area unserved by broadband," at 17.11.10.7.D NMAC:

"Area unserved by broadband" means a sa~:,,4c~a~re~broadband program proposed proiect

area where at least 90-50 percent of the households lack access to fixed and mobile

facilities-based broadband service, either fixed or mobile at the minimum broadband

transmission speeds of 4.0 mbps download/1.0 mbps upload. An unserved area may

considered unserved. A household has access to broadband servic~ i_fof the household

can readily subscribe to that service upon request.

31. Certain participants in the workshop proceedings in this matter proposed this

definition as being a reasonable approach to identifying areas that are underserved given

conditions prevailing in many parts of New Mexico. This definition is also designed to be

relatively unrestrictive, so that the Commission may be able to consider a larger number of

petitions under the Broadband Program of 17.11.10.31 NMAC. CenturyLink, NMECG, and


of a number of participants in the workshop proceedings. Staff supports this change as reflecting

the agreement of the participants.

32. CTIA argues that the definition of unserved and underserved areas should be

amended to comply with the RTA’s requirement that awards of support be "consistent with

federal universal service programs and be based on the best use of the fund for rural areas of the

state." CTIA contends that these definitions should incorporate the federal standards of

determining eligibility by census block and should disqualify areas served by a cartier offering

fixed broadband service at or above the required minimum transmission speeds. However, CTIA


acknowledged that the Commission’s definitions "need not replicate current federal requirements

¯ . ." CTIA notes that federal standards prohibit any area served by an unsubsidized facilities-

based carrier that offers 10 Mbps download/1 Mbps upload broadband service is ineligible for

support.

33. CTIA further argues that broadband program awards should not be granted for

projects for areas in which carriers have already committed to deploy broadband services as a

condition of receiving federal Connect America Fund support. CTIA further argues that carriers

should be prevented from "double dipping" by seeking SRUSF funding for projects receiving

Connect America Fund support.

34. CTIA proposes alternative language for 17.11.10.7.D, in its Initial Comments,

that would read as follows:

"Area unserved by broadband" means a broadband program proposed project area

composed of census blocks in which (i) all ,,~here-. of the households lack access to fixed

and~’a~fl~-facilities-based broadband service at the minimum nominal broadband

transmission speeds of 4.0 mbps download/1.0 mbps upload (actual speeds of 3

Mbps/758 kbps) and (ii) no Carrier has been awarded Connect America Fund support to

deploy broadband service. A household has access to fixed facilities-based broadband

service if the household can readily subscribe to that service upon request.

35. Similarly, Time Warner argues that the Commission’s proposed definitions of

"area underserved by broadband" and "area unserved by broadband" would allow the SRUSF to

"overbuild broadband facilities, by including areas served by unsubsidized competitors in the

’broadband proposed project area.’" Time Warner proposes limiting the use of SRUSF subsidies

to only those census blocks that do not have broadband deployment at the bandwidths defined by


the proposed rules.

477, instead

underserved.

Time Wamer also proposes using "broadband deployment date" fi’om Form

of "market penetration" data to determine which areas are unserved and

Time Wamer further contends that there is "no industry-standard methodology that

would provide the Commission - and, importantly, each of the providers - with confidence that

subscriptions or connections are being reported in a consistent and competitively neutral

manner." Time Warner also raises a concern with regard to the confidentiality of Form 477 data,

arguing that the Commission’s Proposed Rule "raises the potential for federal preemption

regarding any order of disclosure inconsistent with the FCC’s prescribed processes."

36. CTIA, in its reply comments, expresses agreement with Time Warner’s arguments

regarding the definitions of"area underserved by broadband" and "area unserved by broadband."

37. NMECG, in its response comments, notes that these definitions were "discussed

at length during the workshop proceedings and the participants debated, compromised and

ultimately agreed on the definitions appearing in the Proposed Rule." Moreover, the definitions

in the Proposed Rule "were intended by workshop participants to allow the Commission to

consider Broadband Program grant applications targeting the widest reasonable scope of

consumers in the rural areas of New Mexico that have little or no access to broadband service."

38. SBI, in its reply comments, rejects CTIA’s recommendation to align the

definitions of "area underserved by broadband" and "area unserved by broadband" with the

federal definitions. SBI argues that "the federal scheme has been largely ineffective in

increasing both mobile and fixed broadband throughout America."

39. Staff, in its response comments, states that it is not in favor of modifying these

definitions "after they have been extensively negotiated by the parties to the workshops." Staff

concludes that "[e]ach project should be evaluated on its individual facts and merits, and Staff


believes that Commission has the ability under the proposed rule and through other independent

available information whether a broadband project is in the public interest without modification

of the language as suggested by CTIA or Time Warner."

40. The Commission agrees with the abovementioned comments of Staff, NMECG,

CenturyLink, and SBI. In particular, the Commission notes that certain considerations raised by

CTIA and Time Warner may be proper for consideration in proceedings considering applications

within the Broadband Program. However, such considerations should not simply prevent the

Commission from ever considering such applications. As noted above, the workshop

participants generally agreed that the Broadband Program should case a wide net with regard to

applications so as to prevent any worthy application from being blocked from consideration at

the outset. The Commission finds that the above amendments included in the Proposed Rule

should be adopted.

F. Definition of"Broadband Internet Access Service" (17.11.10.7.F NMAC)

41. The Proposed Rule included the following new proposed definition to be added,

at 17.11.10.7.F NMAC:

"Broadband Internet Access Service" means a mass-market retail service by wire or radio

that provides the capability to transmit data to and receive data from all or substantially

all Internet endpoints including any capabilities that are incidental to and enable the

operation of the communications service, or a functionally equivalent service, but

excluding dial-up lnternet access service.

42. The above proposed amendments are consistent with the amended RTA’s

adoption of the term "broadband internet access service." See, e.g., NMSA 1978, § 63-gH-6.A.

The term is not defined in the amended RTA. Certain participants in the workshop proceedings


in this matter proposed this definition as being consistent with related FCC specifications.

CenturyLink, NMECG, and SBI, have filed comments stating that they support the Proposed

Rule as reflecting the agreement of a number of participants in the workshop proceedings. Staff

supports the adoption of this definition as "agreed upon by the parties as a technologically

neutral definition which would allow the deployment of broadband facilities to rural areas of the

state .... "

43. The Commission agrees with the above comments of Staff, CenturyLink,

NMECG, and SBI. The Commission finds that the above amendments included in the Proposed

Rule should be adopted.

G. Definition of"Communication connection" (17.11.10.7.1 NMAC)


at 17.11.10.7.I NMAC:

"Communication connection" means a voice-enabled telephone access line, wireless

voice connection, unique voice over internet protocol service connection, or other

uniquely identifiable functional equivalent as determined by the commission.

45. The above proposed amendments are consistent with the amended RTA’s

adoption of the term "communication connection," for use by the Commission in the event that

the Commission should choose to adopt a per-communication-connection fixed charge as a

means of funding the SRUSF. See, e.g., NMSA 1978, § 63-9H-6.B. The above definition is

identical to that provided in the amended RTA.



proceedings. Staff notes that, "[i]f the commission does keep this definition, Solix as


administrator may need to provide instructions to all of the contributors as to what the

Commission considers a communication connection."

47. As noted below, with regard to 17.11.10.20, CTIA and Time Warner oppose the

inclusion of a fixed, per-connection charge even as an option in the Proposed Rule. Time

Warner further suggests changes to the definition of "communication connection," to make the

term "referable to retail intrastate voice services." Accordingly, Time Warner recommends the

following language, to be added to the end of the definition:

Further provided that, for such services provisioned with capacity greater than a voice

capable grade channel or its equivalent, regardless of tec.hnology, the number of

"communications connections" shall be the number of voice-capable grade channels or

equivalents as provisioned by the service provider that allow simultaneous outbound

calling to the public switched network.

48. However, Time Warner contends that "[e]ven with such clarifications . . . an

assessment of a ’connection’ inevitably would involve some assessment of interstate services."

Time Warner argues that a connections-based approach "would not appear to have the ability" to

distinguish between interstate and intrastate revenues.

49. CTIA, in its reply comments, offers "a slight modification to the Time Warner

definition," using the term "intrastate retail public telecommunications services," because that is

a defined term in the Commission’s Rule. CTIA’s proposed rule language would read as

follows:

"Communications connection" means a voice-enabled telephone access line, wireless

voice c÷m~r~-service, or unique interconnected voice over internet protocol

Final Order A dopting RuleCase No. 17-00077-UT

the cemmissienthat provided customers with intrastate retail public telecommunications

services; further provided that, for such services provisions with capacit’g greater than a

voice capable grade channel or its equivalent, regardless of technology, the number of

"communication connections" shall be the number of voice capable grade channels or

equivalents as provisioned by the service provider that allow simultaneous outbound

calling to the public switched network.

50. Moreover, CTIA argues that the definitions of"access line" and "communications

connection" need clarification. CTIA argues that this rulemaking should be "held in abeyance,"

so that the Commission can "use Case No. 17-00202 to analyze the different ’impressions’ of the

reporting carriers and develop a common, workable approach."

51. NMECG rejects Time Wamer’s "belated recommended changes to this

definition," which, according to NMECG, "would have the Commission define communication

connection in a manner inconsistent with the [amended RTA]."


SBI) The Commission finds that the above amendments included in the Proposed Rule should

be adopted.

H.

53.

Definition of"Eligible telecommunications cartier (ETC)" (17.11.10.7.L NMAC)

The Proposed Rule included the following proposed amendments to the definition

of"Eligible telecommunications cartier (ETC)," at 17.11.10.7.L NMAC:

1 The Commission does not, however, concur with NMECG’s characterization of Time

Warner’s recommended changes as "belated." The Commission intended the workshop processto achieve maximum participation and consensus where possible. However, the workshopprocess in no way precluded interested persons from providing alternative views in the writtencomment procedure, and such comments were not "belated."


"Eligible telecommunications carrier (ETC)" means an-emit-y-a carrier with New Mexico

operations that provides intrastate retail public telecommunications services that has been

designated by the comm~;,c,n as eligible to receive disbursements from the fund or from

the federal universal service fund."

54. The above proposed amendments are consistent with the language of the amended

RTA. They also recognize that ETC’s may be designated by the FCC, such as broadband ETC’s.



contends that this definition "more accurately describe[s] what an ETC is."




I. Definition of "Exempt customer" (17.11.10.7.M NMAC)


of"Exempt customer," at 17.11.10.7.M NMAC:

"Exempt customer" means an end-user of telecommunications service that is the state of

New Mexico, a county, a municipality or other governmental entity; a public school

district; a public institution of higher education; an Indian nation, tribe, or pueblo;a

Native American customer who resides on tribal or pueblo land; a private

telecommunications network; or a person eligible to receive reduced rates under a low-

income telephone assistance plan created by the federal government or the state of New

Mexico.


57. The above proposed amendment tracks the language of Section 63-9H-6.B of the

amended RTA, which expressly recognizes that Native American customers on tribal or pueblo

land, not just the tribes and pueblos themselves, enjoy an exemption from any SRUSF surcharge.

Staff supports this change. CenturyLink, NMECG, and SBI, have filed comments stating that

they support the Proposed Rule as reflecting the agreement of a number of participants in the

workshop proceedings.



adopted.

J. Definition of "Form 477" (17.11.10.7.O NMAC), and Removal of Definition of

"Form 481" (17.11.10.7.P NMAC)


at 17.11.10.7.O NMAC:

"Form 477" means the FCC’s Form 477, Local Telephone Competition and Broadband

Report Form, as amended from time to time, filed with the FCC by carriers as required by

47 C.F.R. § 43.11.

60. The Proposed Rule also proposed removal of the following definition:




proceedings. Staff notes that the FCC "is continually modifying Form 481 and at some point,

Form 481 may be minimized or phased out by the FCC." Staff supports addition this definition

as it is a standard FCC form that is "likely to be used by the FCC for the foreseeable future."




K. Definition of"Imputed benchmark revenue" (17.11.10.7.R NMAC)

63. The Proposed Rule included the following proposed amendment to the definition

of"Imputed benchmark revenue," at 17.11.10.7.R NMAC:

"Imputed benchmark revenue" means the difference between the affordability benchmark

rates established by the commission pursuant to this rule and the carrier’s basic local

exchange residential and business rates as of July 1, 2014, multiplied by the number of

basic local exchange residential and business access lines served by the carrier as of

December 31 of the year that precedes the year during which the revenue requirement is

being determined pursuant to Subparagraph E of 17.11.10.19 NMAC; imputed

benchmark revenue shall not be less than zero.

64. The above proposed amendment recognizes that the defined term "access lines"

should be used in this definition instead of simply using the undefined term "lines," which may

create uncertainty or confusion. CenturyLink, NMECG, and SBI, have filed comments stating


that they support the Proposed Rule as reflecting the agreement of a number of participants in the

workshop proceedings.



adopted.

L. Definitions of "Intrastate retail public telecommunications services revenue"

(17.11.10.7.T NMAC) and "Intrastate retail public telecommunications services"

(17.11.10.7.U NMAC)


of"Intrastate retail public telecommunications services revenue," at 17.11.10.7.T NMAC:

"Intrastate retail public telecommunications services revenue" means the revenue

collected from the sale of intrastate telecommunications services to end users; for voice

over internet protocol (VOIP) and similar services, the portion of total retail revenues

attributable to intrastate retail telecommunications shall be equal to the proportion of calls

originating and terminating in New Mexico to all calls originating in New Mexico..

67. The Proposed Rule also included the following proposed amendments to the

definition of"Intrastate retail public telecommunications services," at 17.11.10.7.U NMAC:

"Intrastate retail public telecommunications services" means services including, but not

limited to, all types of local exchange service; non-basic, vertical or discretionary

services, also known as advanced features, or premium services, such as, but not limited

to, call waiting, call forwarding, and caller identification (ID); listing services; directory

assistance services; cellular telephone and paging services; commercial mobile radio

services; personal communications services (PCS); both optional and non-optional


operator services; wide area telecommunications services (WATS) and WATS-like

services; toll-free services; 900 services and other informational services; message

telephone services (MTS) or toll; CENTREX, centron and centron-like services; video

conferencing and teleconferencing services; the resale of intrastate retail public

telecommunications services; payphone services; services that provide

telecommunications through a New Mexico telephone number using voice over internet

protocol (VOIP) or comparable technologies; any services regulated by the commission;

and such other services as the commission may by order designate from time to time as

equivalent or similar to the services listed above, without regard to the technology used to

deliver such services.

68. The above proposed amendments more closely track the language of the amended

RTA. CenturyLink, NMECG, and SBI, have filed comments stating that they support the

Proposed Rule as reflecting the agreement of a number of participants in the workshop

proceedings. Staff accepts the above amendments.

69. Time Warner proposes amendments removing the term "or comparable

technologies" and "and similar services," with reference to VOIP.

70. NMECG opposes Time Wamer’s proposed amendments as "not necessary to

comply with Senate Bill 308," further noting that "there was no consideration of these proposed

changes during the workshop proceedings." Finally, NMECG states that it "is not aware of any

reason why [Time Warner’s] proposed changes to these definitions would improve the SRUSF

Rule."





M. Definition of"Local exchange carrier (LEC)" (17.11.10.7.W NMAC)


of"Local exchange carrier (LEC)," at 17.11.10.7.W NMAC:

"Local exchange carrier (LEC)" means an entity ~certificated to provide

local exchange service in New Mexico..

73. The above proposed amendment recognizes that a local exchange carrier must be

certificated by the Commission, and thus, the Rule should not recognize local exchange carders

that have not been certificated. CenturyLink, NMECG, and SBI, have filed comments stating

that they support the Proposed Rule as reflecting the agreement of a number of participants in the

workshop proceedings. Staff accepts this change as a clarification.




N. Removal of definition of"New mexico telephone number" (17.11.10.7 NMAC)

75. The Proposed Rule included the following proposed removal of the definition of

"New mexico telephone number," at 17.11.10.7 NMAC:

Final Order Adopting RuleCase No. 17=00077-UT

76. The above proposed amendment recognizes that this term should not be used, and

is not used in the Proposed Rule, as the more well-defined term "access lines" is used

throughout. In addition, the definition of "Communication connection" does not employ this

term. CenturyLink, NMECG, and SBI, have filed comments stating that they support the


proceedings. Staff contends that "the reporting of telephone numbers is an unnecessary exercise

when the number of access lines will suffice..." However Staff notes that, if the Commission

decides to track "communication connections" by telephone number for the purposes of a fixed

per-connection charge, then the Commission may need to include a definition of "telephone

number."




O. Definition of"Rural area" (17.11.10.7.Y NMAC)


of"Rural area," at 17.11.10.7.Y NMAC:

"Rural area" means (i) any unincorporated area or (ii) any city, town or incorporated

place-area with a population of 15,000 inhabitant~ or less as reflected in the United States

census for 2010.

79. The above proposed amendments were the result of extensive discussion and,

eventually, agreement reached among some of the participants in the workshop proceedings.



Rule as reflecting the agreement of a number of participants in the workshop proceedings.

80. Staff notes that the modification of this definition was the subject of much

discussion of the participants in the workshop process. Staff supports this modification. Staff

also notes that, for the purposes of the Broadband Program,

Commission to deviate from this definition.

81. The

NMECG, and SBI.

the Proposed Rule allows the

Commission agrees with the above comments of Staff, CenturyLink,

The Commission finds that the above amendments included in the Proposed

Rule should be adopted. With regard to comments made by La Jicarita with regard to this

definition, the Commission addresses those issues below, near the end of this Order.

P. Definition of"Universal service" (17.11.10.7.AA NMAC)

82. The Proposed Rule included the following new proposed definition to be added at

17.11.10.7.AA NMAC:

"Universal service" means basic local exchange service and comparable retail alternative

services at affordable rates, service pursuant to a low-income telephone assistance plan,

and broadband internet access service to unserved and underserved areas of New Mexico

as determined by the commission.

83. The above proposed amendment simply adopts the new definition of "Universal

service" included in the amended RTA. CenturyLink, NMECG, and SBI, have filed comments

stating that they support the Proposed Rule as reflecting the agreement of a number of

participants in the workshop proceedings. Staff accepts this amendment.

84. Time Warner proposes changing the language of this section to refer to "areas

unserved and underserved by broadband New Mexico .... "


85. NMECG objects to Time Wamer’s proposed language as the language of the

Proposed Rule "was drawn directly from the definition appearing in Senate Bill 308."




Q. Responsibilities of Administrator (17.11.10.12.D & M NMAC) and General

Reporting Requirements (17.11.10.15.E NMAC)

87. The Proposed Rule included the following new proposed responsibility to be

added to the list of responsibilities of the Fund Administrator, at 17.11.10.12.M NMAC:

Advise the commission of any anticipated material changes to, or fluctuations in, the

collection of fund revenues in a timely manner and make recommendations to the

commission on ways to address or correct such changes or fluctuations.

88. The above proposed amendment makes express what is already an implied duty of

the Fund Administrator. The current Fund Administrator, Solix, has performed this function on

a number of occasions. It is reasonable, though, to state this duty expressly in the rule.



accepts this proposed amendment as "simply codif[ying] this responsibility for the administrator

of the fund."

89. Time Warner proposes the following language for subsection D of 17.11.10.12:

Establish procedures, consistent with the Federal Communications Commission’s

procedures and requirements, the commission’s procedural rules and law, and with the


commission’s approval, for protecting the confidentiality of information submitted or

otherwise obtained by the commission or administrator pursuant to this rule.

90. Time Warner also proposes the following related changes to 17.11.10.15.E

regarding confidentiality:

Confidentiality: the commission shall have access to all information reported to the

administrator. Contributing companies may request that company-specific information

required by the reporting requirements of this rule be treated as confidential by so

indicating at the time the information is submitted. The commission shall make all

decisions regarding disclosure of company-specific information and may request further

information or justification from the contributing company to ensure uniformity of

confidential treatment of all information submitted by contributing companies; provided,

that the commission shall act consistent with these rules and the Federal Communications

Commission’s procedures and requirements and in no event offer confidentiality

protections that are less than those provided for the ~ame data by the Federal

Communications Commission. Nothing in this rule shall preclude commission issuance

of an umbrella protective order identifying what reported data shall be, or shall not be,

deemed confidential. The administrator shall keep confidential all company-specific

information obtained from contributing companies for which confidential treatment is

requested, shall not use such information except for purposes of administering the fund,

and shall not disclose such information in company-specific form unless directed to do so

by the commission.

91. NMECG, in its response comments, rejects Time Wamer’s proposed changes,

noting that this provision has "not been amended since the SRUSF Rule was adopted in 2005,"


and "[n]othing in Senate Bill 308 mandates a change to these provisions at this time .... "

Further, NMECG "is not aware of any instances where the Commission or the Administrator has

failed to act in accord with FCC rules with regard to confidentiality of FCC Form 477 data or in

any other respect."

92. The

NMECG, and SBI.

93.

NMAC:




Revenue Reports (17.11.10.16 NMAC)

The Proposed Rule included the following proposed amendment to 17.11.10.16.M

Each ETC and contributing company shall submit on or before May 1 of each year a

revenue report on the form prescribed by the administrator detailing its intrastate retail

public telecommunications services revenues for the prior calendar year.

94. Staff states that the word "services" is proposed "to clarify that the reports are for

services revenues and not just revenues." CenturyLink, NMECG, and SBI, have filed comments

stating that they support the Proposed

participants in the workshop proceedings.

95. The

NMECG, and SBI.


S.

96.

17.11.10.17.A & B NMAC:


Rule as reflecting the agreement of a number of



Other Reports (17.11.10.17.A & B NMAC)

The Proposed Rule included the following proposed amendments to

OTHER REPORTS: ETCs shall comply with the reporting requirements established by

the commission as set forth in 17.11.27 NMAC. In addition, on or before May 1 of each

year, carriers shall report the following information to the administrator in a form

prescribed by the administrator, regarding facilities and activities during the preceding

calendar year:

A. Contributing companies, including ETCs, shall report the number and type

of New Mexico access lines and New Mexico ,~1 ~...~ number~ communication

connections subscribed to in total and within ru:a! area~ each New Mexico census

tract consistent with the reporting required by FCC Form 477, and the number of

such access lines and ’~1~" .......~’~-o communication connections that are

exempt from paying the SRUSF surcharge, in iota! and within rural areag.

B ETC ’~’~ °~ ! ca! ,~--~’h ......"~ .... v,~u .... ~ ~r,~; ..... r,~ ~4"

~"’~°~ itched

97. Staff accepts all of the proposed changes to the "Other Reports" section of the

Rule. With regard to subsection A, Staff states that the amendments would clarify the reporting

requirements to exclude reporting telephone numbers and reporting by rural area and to add

reporting requirements for access lines and communications connections by census tract

consistent with FCC Form 477. With regard to subsection B, Staff believes it is appropriate to

strike this language as the calculation of ARS payments will no longer rely upon access minutes

but access lines. CenturyLink, NMECG, and SBI, have filed comments stating that they support


proceedings.

98.


Time Warner proposes the following alternative language for 17.11.10.17.A:

Contributing companies, including ETCs, shall report the number and type of New

Mexico access 1; .....a ~,T ....~,~v;~ ~r,~ numbers communication connections

subscribed to in total ,~a ,.,;,.r,; .....1 ........ r, ~.r .... r,~ ......... ~’"~ consistent

with any reporting required by FCC Form 477, and the number of such access lines and

.... v ................ communication connections that are exempt from paying the SRUSF

surcharge ;~ ÷~+.1 ,~n ,.,:,-r,; ..... 1 .....

99. NMECG, in its response comments, rejects Time Warner’s proposed changes as

"not required by Senate Bill 308," further noting that the proposed changes are "not an

improvement to the SRUSF Rule."

100. Staff, in its response comments, first argues that "[t]he parties to the workshops

were in agreement with this language, which implies those carriers assenting to this reporting

who participated in that workshop are amenable to providing Form 477 information." Staff

further contends that the Commission needs accurate access line count information to calculate

ARS payments under the amended RTA. In addition, Staff argues that the Fund Administrator

needs accurate communication connection information, should a fixed charge be eventually

adopted. Finally, Staff argues that the information may be needed "to investigate the veracity of

broadband projects submitted for approval .... "




T. Other Reports (17.11.10.17.E NMAC)

102. The Proposed Rule included the following proposed amendments to

17.11.10.17.E NMAC:


In addition, on or before July 1 of each year, ETCs receiving support from the fund

(except those receiving only support pursuant to 17.11.11 NMAC) shall file with the

commission a report, in a form approved by the commission,Cencurrent!y-;,’it~ the

.... ;~o . a~ ;.~’~.-...~, ....a;r,~a ,,, demonstratein_g that the ETC’s payments

from the fund were used for the purpose stated in Subsection A of 17.11.10.27 NMAC.

¯ ~.;.~. o~, ...... .~ If any ETC re uired to file

information with the commission under Subsection E of 17.11.10.-17 NMAC fails to

comply on or before the applicable annual federal ETC reporting deadline, the

administrator shall withhold any disbursements otherwise due to the non-compliant ETC

until the ETC has complied.

103. Staff accepts all of the proposed changes to the "Other Reports" section of the

Rule. CenturyLink, NMECG, and SBI, have filed comments stating that they support the


proceedings.




U. Annual Determination of Fund (17.11.10.19.A, B, & C NMAC)

Final Order A dopting RuleCase No. 17-00077-UT


17.11.10.17.A, B, & C NMAC:

A. The administrator shall determine the amount of the fund ......m, for the next

calendar year and submit its findings to the commission on or before September 1 of each

year to enable ~commission approval, on or before October 1 of each year in

order to provide carders with sufficient time to implement any change in the surcharge

rate.

B. In the event the commission orders a change in fund support, pursuant to

17.11.10.14 or 17.11.10.25 NMAC of this rule or otherwise, that necessitates a fund size

amount greater than that which the commission has previously established, the

commission may order an adjustment to the s~amount of the fund, subiect to the annual

fund cap set forth in Subsection C of 17.11.10.19 NMAC.

C. The amount of the fund shall be equal to the sum of each ETC’s revenue

requirement, calculated pursuant to this section, plus any other fund requirements

determined by the commission, including pursuant to 17.11.10.25, 17.11.10.31 or

17.11.11 NMAC, plus projected administrative expenses and a prudent fund balance~

provided however, the total amount of the fund shall not exceed a cap of thirty million

dollars ($30,000,000) per year.

106. Staff believes that all of the proposed changes to the "Annual Determination of

Fund" are appropriate given the amended language of the RTA. With regard to subsection A,

Staff contends that the proposed amendments would "clarify the current practice." With regard

to subsection B, Staff also states that the proposed amendments would clarify. With regard to

subsection C, Staff states that this language reflects the $30 million cap set in the amended RTA.







V. Annual Determination of Fund (17.11.10.19.E NMAC)


17.11.10.17.E NMAC:

Except where the commission has established an alternative or additional amount

pursuant to 17.11.10.25 or 17.11.10.31 NMAC, the revenue requirement for 2018 and

each year thereafter for each ETC that was eligible as of July 1, 2005 and is a local

exchange carrier shall be equal to the carrier’s 2014 SRUSF revenue requirement,

adiusted by the annual percentage change in the number of access lines served by the

carrier as of December 31 of the prior calendar year compared to the number of access

lines served by the cartier as of December 31, 2014, and then reduced by the carrier’s

imputed benchmark revenue. For 2018, the access lines used for the comparison to 2014

shall be as of December 31, 2016. The SRUSF revenue requirement formula under this

section may be stated arithmetically as follows: revenue requirement minus imputed

benchmark revenue.

109. Staff believes that all of the proposed changes to the "Annual Determination of

Fund" are appropriate given the amended language of the RTA. With regard to subsection E,

Staff believes that the proposed amendments are consistent with the language of the amended

RTA. CenturyLink, NMECG, and SBI, have filed comments stating that they support the



proceedings.




W. Determination of SRUSF Surcharge Rate and Contribution (17.11.10.20.A, B, C,

& D NMAC)

l ll. The Proposed Rule included the following proposed amendments to

17.11.10.20.A, B, C, & D NMAC, as well as the title of the section:

17.11.10.20~....~..~"T¢~ ~.-~---......._..~�’TDt"U ~ ~ ~.~ ~ AND DETE~INATION OF SRUSF

SURCHARGE ~TE ~D CONTRIBUTION:

........ ~ ~v ~Y ~ .....The administrator shall recommend the ~ount of the SRUSF

surcharge rate~_,~_~u,, for the next calendar gear, on or before Sept~ber 1 to enable

co~ission approval on or before October 1, based upon monthly ~d ~ual repots

filed by ETCs and contfibming companies, broadband program ~ants awarded bg the

commission, and any other pe~inent ~d reliable info~ation available to the

adminis~ator or the commission, ~d appl~ng the a~ual ~nd cap. set fo~h in Subsection

C of 17.11.10.19 NMAC.

C. ~e commission shall either set a percentage surcharge rate ~equal to the

a~ual~nd requirement dete~ined by the commission divided by the sum of inVastate

Final Order Adop~ng RMeCase No. 17-00077-~T

retail public telecommunications service revenue, or in the alternative, set a fixed charge

applicable to each non-exempt communication connection equal to the annual fund

requirement determined by the commission divided by the number of non-exempt

communication connections for all contributing carriers in New Mexico., f,vr e,!!

............. ~,,~,.-,.L~ .-’-" New L.~.~...,~o, ,.,~ The surcharge rate or fixed charge may be

adjusted to account for any material deficit or surplus projected to exist at the start of the

fund year, subject to the annual fund cap.

D. Each contributing company’s monthly contribution shall equal the state rural

universal service fund (SRUSF) surcharge rate multiplied by its intrastate retail

telecommunications revenues or non-exempt communication connections, as determined

by the commission, in New Mexico for the month.

112. Staff accepts some of the proposed changes to the "Determination of SRUSF

Surcharge Rate and Contribution," in light of the amended language of the RTA, but Staff also

has its own recommendations. With regard to subsections A and B, Staff concurs with the

proposed changes. However, with regard to subsection C, Staff proposes alternative language

that would allow for a hybrid version of a surcharge, combining the percentage-of-revenue

approach and the per-connection charge approach. Staff is concerned that long distance revenues

may not be fully captured in a per-connection approach as long distance providers may allege

that they rely upon the "connections" of other carriers in order to sell long distance services.

Hence, Staff suggests that the Commission add "or in addition to," so that there is not only a

choice between the two options, but a hybrid option. With regard to subsection D, Staff would

also alter this language to allow for a hybrid option, changing the "or" to an "and/or."




proceedings. However, NMECG suggests a "clarification" to the language of 17.11.10.20(D)

NMAC, as follows:

Each contributing company’s monthly contribution shall equal the state rural universal

service fund (SRUSF) surcharge rate multiplied by its non-exempt intrastate retail

telecommunications revenues or the fixed charge multiplied by the non-exempt

communication connections, as determined by the commission, in New Mexico for the

month.

114. CTIA, however, urges the Commission to strike the alternative fixed, per-

connection surcharge mechanism. First, CTIA argues that the fixed charge would impose a

"regressive tax" on low-income New Mexicans by burdening them with the same contribution

obligation as the wealthiest New Mexicans. Second, CTIA argues that imposing a fixed charge

would run counter to universal service policy by shifting a portion of the cost of the SRUSF from

business customers to residential customers. CTIA contends that the Commission sets

residential service rates lower than business service rates in an effort to promote universal

residential service, and thus, reallocating some of the cost of the SRUSF from business to

residential customers would undermine this policy.

115. Third, CTIA argues that the proposed rule provision is impermissibly vague

because it leaves the option open as to whether the Commission will impose a fixed charge or a

revenue-based percentage charge. CTIA adds that the open option for the Commission requires

carriers to "guess, at their peril, as to which mechanism they will have to implement on the

Proposed Rule’s January 1, 2018 effective date."


116. Fourth, CTIA argues that the provision is impermissibly vague because it does not

specify how the fixed charge would be applied to prepaid wireless service renewed through

third-party vendors. Fifth, CTIA argues that the fixed charge would not be competitively and

technologically neutral, as required by the RTA. CTIA contends that, because the Proposed Rule

provides no way to apply monthly end-user surcharges to prepaid users that purchase service on

an as-needed basis, possibly from third-party retailers, the result would be an inequitable

distribution of the cost of the SRUSF as between prepaid and postpaid consumers. CTIA further

contends that accurate collection of a fixed charge from prepaid wireless customers on a monthly

basis is not feasible due to the general lack of a direct and ongoing billing relationship with such

customers.

117. Sixth, CTIA argues that implementation of a fixed charge on January 1, 2018

would be premature and that, if the Commission decides to implement a fixed charge, the

Commission should provide carriers sufficient time in which to execute the change.

118. Finally, CTIA argues that a connection-based surcharge mechanism will burden

federal universal service support mechanisms in violation of federal law. CTIA cites Section

254(f) of the federal Communications Act, 47 U.S.C. § 254(f), which prohibits any State from

adopting regulations that burden the federal mechanism for calculating and collecting federal

universal service fund contributions. CTIA argues that a fixed charge would not be coordinated

with the federal mechanism because it does not distinguish between interstate and intrastate

revenues. CTIA proposes alternative language for 17.11.10.20.C & D, set forth in its Initial

Comments, which would remove the option of a fixed charge for the reasons given above.

119. Securus states, in its comments, that it is an Institutional Operator Service

Provider ("IOSP"), providing inmate access services and contributing to the SRUSF. Securus


state that it "cannot apply a per-connected fixed charge based on the number of communications

connections, as defined in 17.11.10.7.I of the Proposed Rule." Securus states that it does not

have "dial tone lines, or its functional equivalent, that provides local exchange service." Instead,

Securus provides service using Intemet protocol-enables transport facilities, without dedicated

local exchange access lines or individual dedicated Internet connections. Securus’s services are

provided and billed on a call-by-call basis.

120. Time Warner, in its Initial Comments, "urges the Commission to continue to base

SRUSF assessments on intrastate revenues in harmony with the federal universal service fund

and thereby avoid the potential for federal preemption associated with migrating to a

connections-based approach." Like CTIA, Time Warner argues that the Commission’s proposed

definition for "’communication connection’ appears to conflict with the FCC’s (a) jurisdiction

over and forbearance from universal service assessments of broadband Intemet access service

("BIAS"), (b) authority over and universal assessments of interstate services, and (c) requirement

that any state universal service assessment of voice over Internet protocol ("VoIP") services be

consistent with federal universal service assessments." Time Warner notes that, in its 2015 Open

Internet Order, "the FCC forbore from imposing the requirements of federal universal service

contributions on BIAS" and stated that "’states are bound by out forbearance decisions today’"

(quoting the 2015 Open Internet Order). With regard to the potential taxing of interstate

revenues, Time Warner notes that the FCC has established a "safe harbor" calculation as well as

other methods of determining the allocation of revenues between interstate and intrastate

jurisdictions, and the proposed fixed charge would not comply with these. Time Warner further

notes that the FCC has not yet made a determination as to whether a connection-based method

could accomplish this.


121. Time Wamer also argues that a fixed-charge approach may not be capable of

assessing a charge upon "wireless resellers and nomadic VolP service providers," which would

"bring into question whether the SRUSF is administered consistently with the requirements of

Section 254(0 of the Federal Act, which requires state universal service funds to be implemented

"on an equitable and nondiscriminatory basis."

122. As noted above, with regard to 17.11.10.7.1, Time Warner has also proposed

changes to the definition of "communication connection."

123. CTIA, in its reply comments, expresses its agreement with the arguments made by

Time Warner, including the argument that resellers should be subject to any fixed charge. CTIA

also takes issue with comments by CenturyLink and NMECG that, according to CTIA, "over-

broadly characterize the Proposed Rule as the produce of a ’consensus’ or ’agreement’ among

stakeholders. CTIA contends, "[t]he suggestion that the absence of particular objections during

or following the informal workshops somehow connotes unanimous agreement is simply

incorrect."

124. CTIA also agrees with Securus, stating that Securus’s comments "illustrate the

problems with the per-connection surcharge option described in CTIA’S initial comments."

125. CTIA also rejects Staff’s proposal to modify the Proposed Rule by including a

hybrid option of using both revenues and connection-based surcharges. CTIA contends that,

because the amended RTA uses an "or" instead of an "and," with regard to the two options

presented in the amended RTA, the legislature meant for one or the other to be adopted, but not

both.


126. NMECG, in its response comments, rejects Staff’s proposal of a hybrid surcharge

"[b]ecause it is not necessary for the Commission to commit to a potentially controversial

interpretation of the contribution provisions of the RTA at this time..."

127. With regard to the arguments made by CTIA and Time Warner, NMECG, like

CenturyLink (see below), argues that the arguments "are misplaced in this rulemaking

proceeding and should not be considered in adopting a final amended SRUSF Rule." NMECG

states that "[n]othing in the Proposed Rule reflects an intent by the Commission to adopt any

particular contribution method." NMECG contends that "[a]ny arguments CTIA, [Time Warner]

or any other interested party may have on the matter of a connections-based surcharge should be

presented in Case No. 17-00202, not in this rulemaking proceeding." Moreover, NMECG notes

that CTIA and Time Warner "do not refer to any statements or rulings from the FCC expressing

concem about connections-based state universal service fund assessment mechanism or

manifesting any intent to challenge such a system if implemented in New Mexico or another

state."

128. In its reply comments, CenturyLink argues that the Commission should decide

whether to adopt a connection-based surcharge based upon evidence presented in Case No. 17-

00202-UT, not this rulemaking. CenturyLink argues, in response to the objections raised by

Time Warner and CTIA, that "It]he proposed rules do not adopt a connection-based surcharge,"

instead following the language of the amended RTA, leaving open a choice for the Commission.

CenturyLink contends that leaving the option open does not render the Proposed Rule

"impermissibly vague," as argued by CTIA, as the Proposed Rule would continue to provide for

a process of setting a surcharge on or before October 1st of each year, under 17.11.10.20.A

NMAC. CenturyLink argues that, the Commission’s decision in Case No. 17-00202-UT, with


regard to the potential setting of a fixed, per-connection surcharge, presumably, "will be based

on the evidence and legal arguments brought forward in that case," which need not be resolved

or even addressed in this rulemaking. CenturyLink further contends that "[a] rulemaking

proceeding does not lend itself well to the types of factual inquiry that can be accomplished in

Case No. 17-00202-UT - an investigative proceeding."

129. SBI concurs with CenturyLink and NMECG, arguing that the issues raised by

CTIA are "not ripe" for consideration. SBI contends that, in the Proposed Rule, the Commission

has only "reserve[d] to itself the right to adopt a per-connection charge at some time in the

future."

130. In response to CTIA’s and Time Warner’s concerns about resellers and prepaid

wireless customers, Staff stated that it "does not know if a per-connection methodology can be

applied to the suite of services" identified by those commenters. Staff recommends that such

issues be explored in Case No. 17-00202-UT, which was initiated "for this very reason."

131. Time Warner, in its reply comments, notes its agreement with CTIA’s arguments.


NMECG, and SBI, insofar as they argue that the Commission should consider any of the above

issues raised by CTIA, Securus, and Time Warner in Case No. 17-00202-UT. The comments

submitted by CTIA, Securus, and Time Warner, raise legal and factual issues with regard to the

implementation of a potential fixed, per-connection charge that are likely important for the

Commission to consider in that docket, particularly the potential issue of federal pre-emption.

However, as noted by NMECG, there have been no definitive statements by the FCC with regard

to the application of the federal principles and authorities cited by CTIA and Time Warner to a

per-connection fixed charge. As it appears that the Commission may be on the vanguard of this


issue, with regard to timing (along with Utah and Nebraska, potentially), it may be that FCC

guidance will be forthcoming in the near future.

133. The Commission agrees with CenturyLink that, by adopting rule language leaving

the Commission’s options open, the Commission is merely embodying in the Commission’s

Rule the language of the amended RTA. As noted by CenturyLink, such rule language is not

impermissibly vague as the language of the Proposed Rule provides for an annual procedure

through which the surcharge is set. Moreover, the very issues with which CTIA and Time

Warner are concerned can be better addressed in Case No. 17-00202-UT as voluminous

information from contributing carriers, with regard to their "communication connections," has

been and will likely continue to be collected in that matter.

134. With regard to Staff’s recommendation of a hybrid surcharge, the Commission

rejects that recommendation. The Commission agrees with CTIA insofar as CTIA argues that

the amended RTA does not allow for a hybrid surcharge.

X. Determination of SRUSF Surcharge Rate and Contribution (17.11.10.20.E & G

NMAC)


17.11.10.20.E & G NMAC:

E. If, for any month the administrator finds that the fund balance is insufficient to

th ~-oll ~ZTt,~, ..... ; ..... ~o total oblizations of the fund (including

support pursuant to 17.11.10.19 NMAC, 17.11.10.25 NMAC, 17.11.10.31 NMAC, and

17.11.11 NMAC) plus administrative expenses and maintenance of a prudent fund

balance, the administrator shall prorate all payments to each ETC, with the exception of

payments pursuant to 17.11.10.31 NMAC and 17.11.11 NMAC.In the event the


administrator determines that such a prorated reduction in payments is reasonably likely

to occur, the administrator shall immediately notify the commission and the commission

will take prompt action to increase contribution requirements, subject to the annual fund

cap set forth in Subsection C of 17.11.10.19 NMAC, ~ or otherwise account

for the shortfall and will provide for true-up payments for any underpayments occurring

if prorated reduced payments are required before the contribution requirements can be

increased. If the fund accumulates a surplus beyond what the administrator and the

commission believes is prudent under the circumstances, the administrator may, with the

commission’s approval, decrease contribution requirements so as to lower the fund

balance to an appropriate level.

F. Each contributing company shall remit its monthly contribution to the

administrator on a schedule to be determined by the administrator.

136. With reg~d to subsection E, Staff accepts the proposed amendments as clafi~ng

the duties of the F~d Adminis~ator ~d the Co~ission in the event of a revenue sho~Nll.

With regard to subsection G, Staff notes that this section should be s~ck as it related to the now

Final Order Adopting RuleCase No. 17-00077-VT

Yo

138. The Proposed

17.11.10.25.A, B, & C NMAC:

obsolete Commission-determined cap under the previous version of the RTA. CenturyLink,

NMECG, and SBI, have filed comments stating that they support the Proposed Rule as reflecting

the agreement of a number of participants in the workshop proceedings.




Petition for Support Based on Need (17.11.10.25.A, B, & C NMAC)

Rule included the following proposed amendments to

A. An ETC serving in a high cost rural area of the state may petition the commission

for support from the fund when such payments are needed to ensure the widespread

availability and affordability of residential leca! exchange universal service in the gigta-

c-~rural area(s) of the state served by the ETC.

B. In addition to establishing need as described in Subsection A of this section, a

petition for support based on need shall identify the geographic area for which support is

requested, and shall demonstrate with particularity how the proposed payments from the

fund will be used in a manner consistent with the use of fund support requirements set

forth in 17.11.10.27 NMAC.

C. In support of the petition, the ETC must make available to the commission all

information supplied by ff_orm 481 (or a similar abbreviated form) for the four quarters

prior to the petition filing date, plus New Mexico-specific flZ_orm 481 information if the

form 481 information is consolidated. The commission may also require additional

information from the ETC that it deems necessary, including but not limited to


information relating to the ETC’s regulated revenues, expenses, and investments, to

determine whether support is needed to ensure the widespread availability and

affordability ..............leca! exchangeuniversal service in the ~-rr~,o ....;~

......... area identified in the petition.

139. With regard to subsections A and C, Staff accepts these proposed changes as

reflecting amendments to the RTA. With regard to subsection B, Staff has no problem with

including identification of geographic area as a requirement of a need-based support petition.



140. Sacred Wind proposes additional amendments to the need-based support

provisions. Sacred Wind argues that the current rule lacks "language specifying that carriers

undertaking approved capital investments may ask the Commission for support to sustain these

investments over time once the initial investment has been made successfully and reported to the

Commission." Sacred Wind argues that "need-based support is essential to extending service to

unserved and underserved customers in rural areas," and that "[o]ther rural carriers have had the

advantage for many years of receiving continuing support to offset the reduction of access line

revenues." Sacred Wind proposes that its proposed ongoing, need-based support be in an

amount no less than the average amount per access line of fund support granted to the incumbent

local exchange carriers that receive ARS payments. Accordingly, Sacred Wind proposes the

addition of a Paragraph F to 17.11.10.25 NMAC, which would read as follows:

F. Any ETC that is a local exchange carrier and that is awarded fund support under

Subsections A throu~ E of this section, and that is not a local exchange carrier receiving

fund support under 17.11.10.25 NMAC, may receive fund support on an ongoing basis


for continued replacement or expansion of network equipment and/or operating expenses

related to the proiects for which support was granted under Subsections A through E.

Such ongoing fund support would commence upon approval of the commission and

termination of the project fund support granted under Subsections A through E of the

section and shall be no less than average amount per access line of fund support granted

to the local exchange carriers receiving fund support for replacement of revenue for

reduction of intrastate switched access charges. The Commission shall resolve such a

petition within the time period and in the manner set forth in Subsection D of this section.

141. CenturyLink, in its reply comments, argues that Sacred Wind’s proposal is

outside of the scope of this proceeding, as it is not made "in response to the passage" of SB 308.

CenturyLink further argues that Sacred Wind’s proposal amounts to "bad policy, because it

would distribute NMRUSF support to a provider based on proof of ’need’ in amounts and for

periods of time well beyond the ’need’ proven by the provider in the first place."

142. CTIA, in its reply comments, opposes Sacred Wind’s proposal. CTIA contends

that the proposal "would create an ongoing fund that needs continuously to expand in order to

build new areas," contrary to the federal model, which provides for time-limited grants. CTIA

argues that the state "should support rural projects that can be self-sustaining, not projects that

cannot."

143. NMECG, in its response comments, states that it does not object to the "general

principle advance by Sacred Wind - an ETC receiving need-based support tied to specific

projects should be able to seek, based on a showing of continued need, ongoing support for

replacement and expansion of network equipment and/or operating expenses related to the

projects for which the support was awarded." However, NMECG notes that it is "not aware of


any barrier precluding an ETC from seeking such relief under the current provisions of section

17.11.10.25."

144. Staff, in its response comments, states that it does not support Sacred Wind’s

proposal. Staff argues that "awards for support based on need are not meant to mimic the

payment of access reduction payments ...." Moreover, Staff contends that "[t]here is nothing in

the proposed or current rule that would limit the Commission’s authority to consider a petition

for ongoing support that would grant the relief that the petitioner believes is appropriate under

the circumstances."

145. The Commission agrees with the above comments of Staff and NMECG. As

noted by NMECG and Staff, the Proposed Rule would not prevent a petitioner from seeking

need-based support for replacement, expansion, maintenance and operations. As noted by Staff,

the need-based support provisions of the Rule are not comparable to the ARS payment

provisions, and it does not make sense to tie the measure of need-based support to ARS payment

levels. The Commission finds that the above amendments included in the Proposed Rule should

be adopted.

Z.

146.

Use of Fund Support (17.11.10.27.A & B NMAC)

The Proposed Rule included the following proposed amendments to

17.11.10.27.A NMAC:

An ETC shall use fund support in a manner consistent with the rural telecommunications

act, Sections 63-9H-1 et seq., NMSA 1978, Section 254 of the federal

telecommunications act (47 U.S.C. 254), and commission rules and orders. Fund support

must be used to ~maintain and advance support universal service; provided,

however, that each ETC receivin~ support pursuant to 17.11.10.19 or 17.11.10.25 NMAC


must expend no less than sixty percent (60%) of the support it receives to deploy and

maintain broadband internet access services in rural areas of the state.that is, * ...... ;’~

147. Staff supports the proposed amendments as reflecting the amended RTA, the

federal Telecommunications Act, and Commission rules and orders. CenturyLink, NMECG, and


of a number of participants in the workshop proceedings.

148. The

NMECG, and SBI.




149. The Commission further finds that 17.11.10.27.B should be amended to provide a

clear indication that, among other administrative remedies that the Commission may impose in

the event that an ETC uses fund support in a manner inconsistent with the RTA, the Commission

may withhold payments. Thus, the last portion of 17.11.10.27.B should be amended as follows:

¯.. ordering the ETC to refund amounts paid to it from the fund and withholding future

payments.

AA. Broadband Program (17.11.10.30.A & B NMAC)


17.11.10.30.A & B NMAC:


A. It is the goal of the commission that New Mexico consumers have access to high-

quality broadband service from both wireline and mobile broadband providers. Pursuant

to Subsection N of Section 63-9H-3, NMSA 1978, ETCs may separately apply to the

commission for grants to fund the construction of facilities that are capable of providing

~, broadband internet access service, to areas unserved or

underserved by broadband in the state. Each grant that is awarded will provide up to

seventy five percent of the budgeted project cost with the ETC applying the rema;,q~ng

~ercentremainder from its own funds. Projects receiving any otha~source of

third-party funding other than potential loan funds, FCC high-cost fund legacy support or

e_Connect aAmerica ff_und support (including Mobility Fund support) will not be eligible.

In evaluating applications, the commission shall seek to avoid duplication of service

using the same technology. Awards of support under this section shall be consistent with

federal universal service support programs and be based on the best use of the fund for

rural areas of the state. For purposes of administering the broadband program, the

commission may find that a broadband program proposed project area is a rural area,

notwithstanding the definition of rural area in Section 17.11.10.7(U) NMAC, if it

determines that (a) the area otherwise has the characteristics of a rural area, (b) the area is

unserved or underserved by broadband, and (c) the public interest requires that the area

be classified as rural.

B. Funding of the broadband program. Beginning in -24)4-72018, and each year

thereafter, at least five million dollars ($5,000,000) of the fund shall be dedicated

annually to the broadband program_. ,.T;11 k~ ~lflafiA k .......... , ..... [ + .......... ’ fie


The amount of ~nding allocated to the broadband pro~am shall not be subject to

proration under Subsection E of 17.11.10.20 NMAC. To the extent a ye~’s broadband

pro~ ~nding is not exhausted by ~ants awarded during that year, the ~nds will

rollover to the following year.

151. Staff notes that the cu~ent v~sion of the Rule "is modeled on a success~l

Nebraska broadb~d pro~am." However Staff believes that the proposed ~endments would

improve the Rule ~d "will bett~ sere the Co~ission in the review ~d approval of

broadband projects in New Mexico." Staff believes that the amendments would improve the

Broadband Pro~am as they are based upon "additional scrutiny and negotiations among the

pa~ies ...." Cen~Li~, NMECG, ~d SBI, have filed co~ents stating that they suppo~ the

Proposed Rule as reflecting the a~e~ent of a number of pa~icipants in the workshop

proceedings.

152. CT~ aries that broadb~d prog~ aw~ds should not be ~anted for projects

for areas in which ca~ers have already co~itted to deploy broadband se~ices as a condition

of receiving federal Co~ect ~efica Fund suppo~. CTIA ~her ~es that ca~ers should be

prevented from "double dipping" by seeking SRUSF ~nding for projects receiving Co~ect

~efica Fund suppo~.

153. NMECG rejects CTIA’s ar~ment, noting that this issue was discussed in the

workshops. ~e pa~icip~ts in the workshops, according to CTIA, decided not to so restrict the


inflow of applications so as "to ensure the Commission retains the ability to review and evaluate

as many grant applications as possible."




BB. Broadband Program (17.11.10.31 .C, D, E, F, & G NMAC)


17.11.10.31.C, D, E, F, & G NMAC:

C. Applicants for broadband program grants may request that company-specific

information contained within an application be treated as confidential. The commission

shall make all decisions regarding disclosure of company-speclfic information and may

request further information or justification from the contributing company to ensure

uniformity of confidential treatment of all information submitted by contributing

companies. Nothing in this rule shall preclude commission issuance of an umbrella

protective order identifying what reported data shall be, or shall not be, deemed

confidential. The commission staff or a third-party contractor, shall keep confidential all

company-specific information obtained from applicants for broadband program ~rants for

which confidential treatment is requested, shall not use such information except for

purposes of analyzing the applications, and shall not disclose such information in

company-specific form unless directed to do so by the commission.

DG. Minimum requirements for eligible projects. The commission will

consider projects on a technology-neutral basis. Projects that apply technologies

including, without limitation, wireline, mobile wireless, and fixed wireless technologies

Final Order" Adopting RuleCase No. 17-00077-UT

are all eligible for broadband fund grants. A project must meet the following

requirements to be eligible for a grant award:

(1) support broadband intemet access service at speeds of at least ~

4 mMbps download/one--1 mMbps upload to all households and businesses in the

proposed project area;

(2) support voice grade telephony service to all households and

businesses in the proposed project area. For this purpose, a voice over intemet protocol

(VOIP) based service is acceptable, as well as traditional voice telephony services and

mobile voice services; and

(3) Support access to emergency 911 services.

El). Contents of grant applications.

broadband program shall include, at a minimum:

An application for support from the

(1) a proposal to build telecommunications network facilities to

service an area where the applicant is designated as a state ETC;

(2) a detailed build plan setting forth a description of the facilities to

be deployed, including all costs of constructing facilities;

(3) a map showing where service and coverage will be provided; this

requirement can be met by providing;

(a) for a wireline network, a map showing all homes,

businesses, and other end user locations passed;

(b) for a wireless network, a coverage map generated using a

radio frequency propagation tool generally used in the wireless industry;


I(4) an estimate of the number of road miles and square miles to be

covered and population and population density of the area covered;

(5) the amount of support requested from the broadband program and

the amount of the applicant’s financial match, and a description of any type, amount~ and

purpose of subsidy or financial support the applicant is currently receiving or is

scheduled to receive in the area designated in the application;

(6) a description of the technology to be deployed, including data

throughput speeds and latency characteristics of the service to be delivered to customers;

(7) a demonstration that the area to be served is an area unserved by

broadband or an area underserved by broadband as defined in 17.11.10.7 NMAC. If the

area to be served contains both unserved and underserved areas, the application shall

identify which portions of the area are unserved and which are underserved;

(8) a demonstration of t4aat-the estimated customer subscription rates

and revenues from the services to be offered as a result of the proposed construction

weu!d be insufficient to justify the project with,cut support from the broadband program;

(9) a commitment to provide a minimum twenty five percent match of

funds drawn from the broadband program;

(10) if the project is a wireless network deployment, a commitment to

allow collocation on reasonable terms by other providers of commercial mobile wireless

service or any public safety network and to abide by the FCC’s collocation requirements

for awardees under the federal universal service program;

(11) sample terms and conditions for the service and proposed prices;


(12) a certification by an authorized representativeo~.....~,~÷-’;

affixing that all ~info~ation set fo~h in the application is ~e ~d co~ect; and

(13) any other requirements to ensure accountability as the commission

may develop and approve in a proceeding to dete~ine the fo~ and contents of N~t

applications.

~g. The ETC must m~e the following co~itments ~d include them in its

proposed application:

(1) the voice and broadb~d se~ice must be off~ed at reasonably

comp~able rates for comparable se~ices in urban areas;

(2) the voice ~d broadband semite must be provided for at least five

years following project completion;

(~4) the ETC must abide by co~ission reposing requir~ents

sufficient to monitor the progess of the project d~lo~ent and to ensure that all Nant

~nds are being used efficiently ~d for the puoose intended.

(~) the ETC must co--it to respond to commission inquiries

regarding se~ice-related complaints ~d co--it to aR~pt to resolve se~ice-related

complaints in a reasonable ma~er.

Procedure for aw~ding suppo~ ~om the broadband Nnd:

(1) ~ .... *-~ id d d

and establish aOn or before May 1 of each year, the commission shall open a proceeding


30 day window for filing applications for broadband program support for the following

calendar year. The commission staff, or a third party contractor, shall review all timely

applications.

(2~) Interested persons may seek inte~ention in ~ese proceedings,

pursuant to 1.2.2.23 NMAC.

(3~) On or before S~tember 1, the co~ission’s staff, or a tNrd-p~y

con~actor, shall~ make a presentation to the co~ission with analysis of the

Final Order Adopgng RuleCase No. 17-00077-UTPage g4

applications for awards ........an,;,,,,o fo ......."* ......ao The commission’s staff, or

a third-party contractor, may communicate with applicants to request additional

information or claril;y information presented in the applications in order to prepare its

presentation, wr, ....1;~.,o o.a ....;,., ............. ~.ou ........ r, ........ an,;~o

Such recommendations presentations shall be considered by the commission but shall not

bind the commission.

(4) On or before October 1, the commission shall issue a decision

approving, denying, or modifying, in whole or in part, each application. Selection of

projects will prioritize unserved, underserved, and served areas, in that order.

(5) On or before {)ember-November 1, any ,,vv--.~,-,~u’~’* interested person

may file with the commission a request for reconsideration of the disposition, in whole or

in part, of any award of broadband fundsa

(6) On or before December 1, the commission shall approve-or, deny=

or modify support awards by a final order.

156. Staff notes that the current version of the Rule "is modeled on a successful

Nebraska broadband program." However Staff believes that the proposed amendments would

improve the Rule and "will better serve the Commission in the review and approval of

broadband projects in New Mexico." Staff believes that the amendments would improve the

Broadband Program as they are based upon "additional scrutiny and negotiations among the

parties ...." CenturyLink, NMECG, and SBI, have filed comments stating that they support the


proceedings. NMECG, however, has suggested the following clarification for 17.11.10.31.G(5):


I

On or before November 1, (i) any interested person may file with the commission a

request for reconsideration of the disposition, in whole or in part, of any award of

broadband funds; and (ii) with respect to an award resulting from an application that was

modified by the commission, the applicant may file with the commission a request for

reconsideration or a notice of reiection of the modification.

157. Time Warner proposes alternative language for 17.11.10.32.E(7), rejecting the

notion that a project area could include both unserved and underserved areas.

158. NMECG rejects Time Warner’s proposals, noting that "[t]he language targeted by

[Time Warner] was agreed to by workshop participants and include in the Proposed Rule to

recognize the possibility that a proposed project may involve an area that has both an unserved

portion and an underserved portion..."

159. NMECG further states that it accepts Staff’s proposed corrections of the

"typographical errors" in the Proposed Rule with regard to 17.11.10.31.



Rule should be adopted, with the typographical corrections proposed by Staff.

CC. Broadband Program (17.11.10.31.H NMAC)


17.11.10.31.H NMAC:

HG. Conditions for disbursement of awarded funds:

(1) The awardee commits to complete construction of its project

within two-three _years from the a~mat-date of the initial disbursement made pursuant to

paragraph (3) of Subsection G of 17.11.10.31 NMAC.


(2) For each awarded project, proiect reports shall be submitted to

Staff, consultant(s), and/or administrator(s) semiannually that provide the types of

information described in 17.11.10.25(E) NMAC. Within 30 days after project

completion, the awardee shall submit a report demonstrating that the project as completed

meets the coverage requirements set forth in the application, including a certification

from an officer or director that all program requirements have been met.

(3) The administrator shall disburse ~--:~-’ Fercentone third of the award

~ at the beginning of the project as determined by the Commission, one third at

the midpoint of the project, and the remaining third upon project completion. The second

and third payments are contingent upon the a-d

submission of an--acceptable project comp!etien status report_s ~ter--pursuant to

Paragraph (2) of Subsection G of 17.11.10.31 NMAC. The commission may, within 30

days after submission of a report, order additional information to be provided, suspend

payment by the administrator, or take other action as necessary a~ter notice and hearing

(4) Any applicant found to have willfully misrepresented information

in an application, is found to have used support unlawfully, or fails to meet the

commitments set forth in the application, may be subiect to shag-refund of al4-award

funds or other actions of the C̄ " ;~A;~÷~Iommlsslon ..............


~11

..~r.~... ...., .....r. ...... *~ ;° ~"~"*~ ......... * *~ 17 II ~n ~o N~A,~ If

162. Staff notes that the cu~ent v~sion of the Rule "is modeled on a success~l

Nebraska broadband pro~am." However Staff believes that the proposed ~endments would

improve the Rule and "will better sere the Co~ission in the review and approval of

broadb~d projects in New Mexico." Cen~Li~, NMECG, and SBI, have filed co~ents

stating that they suppo~ the Proposed Rule ~ reflecting the aNe~ent of a number of

pa~icipants in the woNshop proceedings.

163. The Commission aNees with the above co~ents of Staff, Cen~Li~,

NMECG, and SBI. ~e Commission finds thN the above amendments included in the Proposed

Rule should be adopted, with the t~oNaphical co~ections proposed by Staff.

DD. La Jicafita

164. On October 12, 2017, La Jicafita filed co~ents in this docket. However, in

violation of Co~ission Rule 1.2.2.10.C(2) N~C, La Jic~ta did not include a ce~ificate of

se~ice. ~us, it is u~own to the Co~ission whether La Jic~ta se~ed the Nll se~ice list in

this matter, as required by 1.2.2.10.C(1 ) NMAC.


165. As noted above, on November 13, 2017, the day that the record closed in this

matter, La Jicarita filed a Motion for Filing Comments Out of Time (the "La Jicarita Motion").

On November 27, 2017, NMECG filed a Response to the La Jicarita Motion.

166. In the La Jicarita Motion, La Jicarita requests that the Commission allow it to file

comments out of time "to ensure the Commission has all the information it needs to make a

decision in this proceeding - specifically in regards to the definition of ’rural areas.’" La Jicarita

states that, "[i]n an attempt to further investigate the issues surrounding the definition of rural

areas and La Jicarita’s proposed changes offered in comments, additional information came to

light that La Jicarita believes the Commission should have in front of it when making its decision

in this proceeding." La Jicarita cites a "recent Solix filing," which, according to La Jicarita,

indicates that CenturyLink and Windstream receive over $8.7 million in annual SRUSF support.

La Jicarita argues that this represents approximately thirty-three percent of the total SRUSF

support. La Jicarita further argues that, if the Commission were to adopt La Jicarita’s proposal,

advocated in the abovementioned comments filed by La Jicarita, to adopt a more restrictive

version of the definition of "rural area," in 17.11.10.7(Y) NMAC, then the Commission could

"eliminate CenturyLink’s and Windstream’s support."

167. NMECG, in its Response, first notes that the La Jicarita Motion does not include a

certificate of service "or otherwise reflect that it was served on other participants in the case..."

NMECG’s counsel notes that he was not served with the motion and only discovered it in the

Commission’s electronic filing system, "Infoshare." NMECG further contends that La Jicarita

has not provided justification for its failure to submit its proposed additional comments in a

timely manner. NMECG contends that La Jicarita’s new comments are not based upon new


information unavailable when initial comments were submitted or when opportunity for oral

comment, at the public hearing, was provided by the Commission.

168. The Commission agrees with NMECG and denies the La Jicarita Motion. The

Commission notes: (1) the fact that La Jicarita has not provided a sufficient reason to allow it to

file late comments, and (2) the fact that La Jicarita did not include a certificate of service and,

apparently, did not serve the motion. Moreover, it would be unfair to other participants and

potential participants to allow La Jicarita to file late comments, on the day that the record closed.

169. With regard to the comments filed by La Jicarita, the apparent failure to serve

such comments would be a sufficient reason to disregard them. However, the Commission also

notes that La Jicarita’s proposal is substantively objectionable. La Jicarita proposes that the

definition of "rural area" include a restriction upon the "serving ETC," such that any such ETC

would be required to have "an average state-level or study area density of less than or equal to

ten locations per square mile."

170. CenturyLink, in its reply comments, argues that this proposal would discriminate

against most rural New Mexico consumers, and thus, should be rejected. CenturyLink calls the

proposal "self-serving and discriminatory," noting that "many consumers in unincorporated areas

or in towns smaller than 15,000 inhabitants [would be prevented] from receiving support for

voice or broadband services solely because of the identity of the incumbent carder who serves

their home." CenturyLink further notes that the proposal "would likely disqualify any rural

consumer or rural area in CenturyLink QC territory from any voice or broadband support..."

NMECG, in its response comments, also opposes La Jicarita’s proposal, noting that "as a result

of extensive debate and compromise during the workshop, which included consideration of [La

Jicarita’s] idea for including a population density requirement, the NMECG and others agreed to


the definition appearing in the Proposed Rule as a compromise." Staff also rejects La Jicarita’s

proposal, contending that the proposal "is unnecessary as broadband project proposals must

report population and population density in the identified service area of the project."

171. The Commission agrees with the above comments by NMECG, CenturyLink, and

Staff. The Commission rejects La Jicarita’s proposal.

IT IS THEREFORE ORDERED:

A. The amended SRUSF Rule (consisting of 17.11.10.1 through 17.11.10.31

NMAC and attached to this Order as Exhibit 1 (the "New Rule")) is approved and adopted,

effective January 1, 2018. The New Rule replaces 17.11.10.1 NMAC through 17.11.10.31

NMAC, as they existed immediately prior to this Order, which are repealed.

B. The New Rule shall be filed and published at the earliest opportunity in the NEw

MEXtCO P,~ISTE~’,, as required by the State Rules Act, NMSA 1978, Sections 14-4-1 to -11 (1967,

as amended through 2017), and implementing rules. This Order and the New Rule shall also be

"provided to the public," in accordance with the State Rules Act.

C. All issues raised in this matter that are not expressly addressed in this Order are

hereby disposed of consistent with the terms of this Order.

D. Copies of this Order, including the exhibit, shall be emailed to all persons on the

attached Certificate of Service if their email addresses are known, and if not known, mailed to

such persons via regular mail.

E. This Order is effective immediately.

F. This docket is now closed.


ISSUED under the Seal of the Commission at Santa Fe, New Mexico, this 7th day of

December, 2017.

NEW MEXICO PUBLIC REGULATION COMMISSION

JONE~

CYNTHIA B. HALL, VICE CHAIR

V~ALERIE ESPINOZA,~OMMISSI(~ER

I~ATRICK H. LYONS, COMtVIISSIONER

Final Order Adopting RuleCase No. 17-00077-UTPage 63

EXHIBIT 1 - NEW RULE

TITLE 17 PUBLIC UTILITIES AND UTILITY SERVICESCHAPTER 11 TELECOMMUNICATIONSPART 10 STATE RURAL UNIVERSAL SERVICE FUND

17.11.10.1 ISSUING AGENCY: New Mexico Public Regulation Commission.[17.11.10.1 NMAC - Rp, 17.11.10.1 NMAC, 1/1/201_8~]

17.11.10.2 SCOPE: This rule applies to all entities that provide intrastate retail public telecommunication servicesand comparable retail alternative services in New Mexico.[17.11.10.2 NMAC - Rp, 17.11.10.2 NMAC, 1/1/201_8~]

17.11.10.3 STATUTORY AUTHORITY: Sections 8-8-4 and 63-9H-6, NMSA 1978.[17.11.10.3 NMAC - Rp, 17.11.10.3 NMAC, 1/1/201_8g]

17.11.10.4 DURATION: Permanent.[17.11.10.4 NMAC - Rp, 17.11.10.4 NMAC, 1/1/2018g]

17.11.10.5 EFFECTIVE DATE: January 1, 24M-7-2018, unless a later date is cited at the end era section.[17.11.10.5 NMAC - Rp, 17.11.10.5 NMAC, 1/1/2018~]

17.11.10.6 OBJECTIVE: The purpose of this rule is to provide procedures for administering and implementing theNew Mexico state rural universal service fund to maintain and support universal service at affordable ..... ~ ...... t.~;.

;~ provided by telecommunications carriers that havebeen designated as eligible telecommunications carriers, including commercial mobile radio services carriers as aredetermined by the commission.[17.11.10.6 NMAC - Rp, 17.11.10.6 NMAC, 1/1/201_87]

17.11.10.7 DEFINITIONS: In addition to the defmitions contained in Section 63-9H-3, NMSA 1978, as used in thisrule:

A. "Access line" means a dial tone line, or its functional equivalent, that provides local exchange service froma carrier’s switching equipment to a point of termination at the customer’s network interface the ce, rmecti~n ef the end u~er~,~***~. ............ ~ ~..~ .... w~**~’~;~ ~;vkched network, and is not limited to wireline or any other technology; for the purposes of this rule,an access line does not include official lines, unbundled network elements/platforms, retail resale, wholesale resale, specialaccess lines and private lines.

B. "Administrator" means the person designated by the commission to administer the fund.__C~. "Area underserved by broadband" means ~e.’Ace area a broadband program proposed project area where

at least 50 percent of households lack access to fixed and mobile facilities-based broadband servic~ either fi×ed er me.bi!e, atthe minimum broadband transmission speeds of 410.0 mbps download/1.0 mbps upload. An ",mderse~.’ed area may includeindividual cen~u~ block group~ or tract~ that on their ~;vn would not be c.~n~idered under~e~,~ed. A household has access tobroadband service if the household can readily subscribe to that service upon request.

D_~. "Area unserved by broadband" means a :;ervice area broadband program proposed project area where atleast 90-50 percent of the households lack access to fixed and mobile facilities-based broadband service~ either fixed orm~Ae-at the minimum broadband transmission speeds of 4.0 mbps download/1.0 mbps upload. ,Am un’~;e~,’ed area may

n A household has accessto broadband service if of-the household can readily subscribe to that service upon request.

_EG. "Basic local exchange rate" means an incumbent local exchange carrier’s tariffed, monthly, flat single-line rate charged to its retail customers for the provision of local exchange service; for the purposes of this rule, the"residential" and "business" basic local exchange rates shall include any commission-mandated subscriber line charges orextended area service charges.

F. "Broadband Internet Access Service" means a mass-market retail service by wire or radio that providesthe capability to transmit data to and receive data from all or substantially all Internet endpoints includin.~ any capabilitiesthat are incidental to and enable the operation of the communications service, or a functionally equivalent service, butexcluding dial-up Internet access service.

_GD. "Carrier" means an entity that provides intrastate retail public telecommunications services or comparableretail alternative services in New Mexico.


HE. "Commercial mobile radio service (CMRS)" means a designation by the federal communicationscommission for any carrier or licensee whose wireless network is connected to the public switched telephone network or isoperated for profit.

I. "Communication connection" means a voice-enabled telephone access line, wireless voice connection,unique voice over internet protocol service connection, or other uniquely identifiable functional equivalent as determined bythe commission.

JF. "Commission" means the New Mexico public regulation commission.KG. "Contributing company" means any carrier that provides intrastate retail public telecommunications

services or comparable retail alternative services in New Mexico._Lt4. "Eligible telecommunications carrier (ETC)" means an entity a carrier with New Mexico operations that

provides intrastate retail public telecommunications services that has been designated by the c~mmi~i~n as eligible toreceive disbursements from the fund or from the federal universal service fund.

~,._[lI. "Exempt customer" means an end-user of telecommunications service that is the state of New Mexico, acounty, a municipality or other governmental entity; a public school district; a public institution of higher education; anIndian nation, tribe, or pueblo; a Native American customer who resides on tribal or pueblo land; a privatetelecommunications network; or a person eligible to receive reduced rates under a low-income telephone assistance plancreated by the federal government or the state of New Mexico.

N__J. "FCC" means the federal communications commission.O. "Form 477" means the FCC’s Form 477, Local Telephone Competition and Broadband Report Form, as

amended from time to time, filed with the FCC by carriers as required by 47 C.F.R. § 43.11.

Ol~. "Fund" or "State Rural Universal Service Fund (SRUSF)" means the state of New Mexico universalservice fund established pursuant to Section 63-9H-6, NMSA 1978 and this rule.

_RM. "Imputed benchmark revenue" means the difference between the affordability benchmark ratesestablished by the commission pursuant to this rule and the carrier’s basic local exchange residential and business rates as ofJuly 1, 2014, multiplied by the number of basic local exchange residential and business access lines served by the carrier asof December 31 of the year that precedes the year during which the revenue requirement is being determined pursuant toSubparagraph E of 17.11.10.19 NMAC; imputed benchmark revenue shall not be less than zero.

SN. "Interexchange carrier (IXC)" means an entity that provides intrastate toll services in New Mexico.TO. "Intrastate retail public telecommunications services revenue" means the revenue collected from the

sale of intrastate telecommunications services to end users; for voice over internet protocol (VOIP) and similar services, theportion of total retail revenues attributable to intrastate retail telecommunications shall be equal to the proportion of callsoriginating and terminating in New Mexico to all calls originating in New Mexico.

Uta. "Intrastate retail public telecommunications services" means services including, but not limited to, alltypes of local exchange service; non-basic, vertical or discretionary services, also known as advanced features, or premiumservices, such as, but not limited to, call waiting, call forwarding, and caller identification (ID); listing services; directoryassistance services; cellular telephone and paging services; commercial mobile radio services; personal communicationsservices (PCS); both optional and non-optional operator services; wide area telecommunications services (WATS) andWATS-like services; toll-free services; 900 services and other informational services; message telephone services (MTS) ortoll; CENTREX, centron and centron-like services; video conferencing and teleconferencing services; the resale of intrastateretail public telecommunications services; payphone services; services that provide telecommunications through a NewMexico telephone number using voice over internet protocol (VOIP) or comparable technologies; any services regulated bythe commission; and such other services as the commission may by order designate from time to time as equivalent or similarto the services listed above, without regard to the technology used to deliver such services.

_.VQ. "Intrastate switched access charge" means a charge levied by a carrier for the availability and use of itsfacilities for origination and termination of intrastate interexchange calls as contained in tariffs approved by the commission.

__.WR. "Local exchange carrier (LEC)" means an entity that prc;’ide~ certificated to provide local exchangeservice in New Mexico.

X~;. "New Mexico operations" means intrastate retail public telecommunications services and comparableretail alternative services provided in New Mexico.


~fYU. "Rural area" means i(j2_any unincorporated area or (ii) any city, town or incorporated pta~e-area with a

population of 15,000 fi’2~ab~t~,nts or less as reflected in the United States census for 2010._ZV. "Service area" means a geographic area established by the commission in accordance with Section

214(e)(5) of the federal act (47 U.S.C. Section 214(e)(5).AA. "Universal service" means basic local exchange service and comparable retail alternative services at

affordable rates, service pursuant to a low-income telephone assistance plan, and broadband internet access service tounserved and underserved areas of New Mexico as determined by the commission.[17.11.10.7 NMAC - Rp, 17.11.10.7 NMAC, 1/1/201_87]

17.11.10.8 REDUCTION OF INTRASTATE SWITCHED ACCESS CHARGES: The commission may, uponmotion of a cartier or the administrator, or upon the commission’s own motion, authorize further intrastate switched accesscharge reductions for a carrier to correspond to any changes in that carrier’s tariffed interstate switched access service chargerates, elements or structure subsequent to January 1, 2006.[17.11.10.8 NMAC - Rp, 17.11.10.8 NMAC, 1/1/201_87]

17.11.10.9 AFFORI)ABILITY BENCHMARK RATES:A. Effective July 1, 2015, the residential and business affordability benchmark rates to be utilized in

determining the level of support available from the fund are as follows:(1) the residential benchmark rate shall be equal to the rate required by the federal communications

commission (FCC) to maintain federal high cost support, as such rate may change from time to time;(2) the business benchmark rate shall be carrier-specific and shall be equal to the business basic

exchange rate of each local exchange carrier on July 1, 2014, plus the amounts required to increase the carrier’s residentialbasic local exchange rate on or after July 1, 2015 to match the new residential benchmark rate set forth above, up to a limit of$35.96;

(3) each local exchange carrier shall, on or before May 1 of each year, advise the commission and theadministrator in writing of its residential and business basic local exchange rates to be in effect on July 1 of that year and howthey were determined;

(4) increases in the residential basic local exchange rates of incumbent rural telecommunicationscarriers toward the residential benchmark rate established in this section shall be implemented by timely filing of tariffrevisions with the commission and shall be effective after 10 days’ notice to the carder’s customers and the commission;

B. The commission may conduct a proceeding to establish new affordability benchmark rates upon its ownmotion.[17.11.10.9 NMAC - Rp, 17.11.10.9 NMAC, 1/1/201_87]

17.11.10.10 SELECTION OF ADMINISTRATOR: The commission will designate a third-party administrator whowill be subject to the supervision and control of the commission for a four-year term. The administrator shall performservices under the terms of a written contract to be entered into between the commission and the administrator. Thecommission shall procure the services of a subsequent administrator before the expiration of the term of each such contract,or in the event of early termination of such contract, as soon as practicable before or after the early termination.

A. Criteria for selection: the commission will issue a request for proposals to select the administrator; thecommission shall consider whether the bidder has demonstrated the competence needed to administer the fund and the rate ofcompensation proposed; the commission shall also consider at a minimum whether the bidder:

(1) is able to be neutral and impartial;(2) is a member of a trade association that advocates positions before this commission or other state

commissions in administrative proceedings related to telecommunications issues;(3) is an affiliate of any contributing company;(4) has a substantial financial interest in any entity or affiliate that provides telecommunications

services or comparable retail alternative services; and(5) has a board of directors that includes any member with direct financial interests in entities that

contribute to or receive support from the fund in this state or any other state.B. Termination of administrator’s contract: the commission may terminate the administrator’s contract with

the commission before the expiration of the term of the contract upon such notice, and under such conditions, as are set forthin the contract.[17.11.10.10 NMAC - Rp, 17.11.10.10 NMAC, 1/1/201_8~]


17.11.10.11 EXPENDITURE AUTHORIZATION: The commission shall approve an annual budget foradministration of the fund. The reasonable expenses incurred in the administration of the fund, in accordance with the termsof the contract between the commission and the administrator, shall be a cost of the fund and shall be recovered fromcontributions to the fund.[17.11.10.11 NMAC - Rp, 17.11.10.11 NMAC, 1/1/201_8~]

17.11.10.12 RESPONSIBILITIES OF ADMINISTRATOR: The administrator shall manage the day-to-dayoperation of the fund in accordance with this role, applicable law, and the overall supervision and direction of thecommission. The administrator shall:

A. Fairly, consistently, and efficiently administer fund collections and disbursements in accordance withcommission rules and subject to commission oversight.

B. Establish an account or accounts in one or more independent financial institutions and ensuring that themonies deposited in the fund are insured to the maximum extent permitted by law and that they earn a return commensuratewith that of state funds held on deposit in banks or other financial institutions.

C. Ensure that the fund complies with all necessary requirements for exemption from federal, state and localtaxes.

D. Establish procedures, consistent with the commission’s procedural rules and law, and with thecommission’s approval, for protecting the confidentiality of information submitted pursuant to this rule.

E. Report to the commission on fund activities at least once each year; the report shall include fund collectionsand disbursements, administrative expenditure information, budget projections and such other information as the commissionmay require.

F. Prepare an annual proposed budget for administration of the fund and submit it to the commission forreview, revision, rejection or approval at such time in advance of the need for commission approval as the commission maydirect, or absent such direction, at a reasonable time.

G. Propose to the commission uniform procedures, and develop forms, to identify exempt customers, inconsultation with contributing companies.

H. Create and maintain the databases necessary to administer the program and account for the funds.I. Develop appropriate forms for use in collecting information from contributing companies and ETCs.J. Pay administrative expenses out of the fund in accordance with the budget approved by the commission.K. Petition the commission to institute an enforcement or other action when the administrator finds that it is

otherwise unable to collect amounts properly due from a contributing company under these rules, or when it appears to theadministrator that any contributing company or ETC carrier is otherwise out of compliance with these rules or applicable law.

L. Conduct, not less than once every year, such reviews as are necessary to ensure that each contributingcompany is making its required contributions to the fund and that support from the fund is used for the purpose of the fund.

M. Advise the commission of any anticipated material changes to, or fluctuations in, the collection of fundrevenues in a timely manner and make recommendations to the commission on ways to address or correct such changes orfluctuations.[17.11.10.12 NMAC- Rp, 17.11.10.12 NMAC, 1/1/2018g]

17.11.10.13 DISPUTE RESOLUTION: The commission may refer any disputed case between the administrator and acontributing company or between contributing companies to alternative dispute resolution if it fmds that doing so wouldencourage the settlement of the dispute.

A. Mediation:(1) if any of the parties or staff makes a request for mediation, the commission may, in its discretion,

designate a mediator consistent with Subsection B of 17.1.2.20 NMAC;(2) the mediator may be a permanent or temporary employee of the commission or another state

agency or any other individual who is acceptable to the parties and staff; if the parties request a mediator who is not anemployee of the commission, the commission shall not approve the request unless the parties agree in writing to bear as theirown the costs of obtaining the mediator’s services; the mediator shall not be the hearing examiner who is assigned to the case;the mediator shall have no official, financial, or personal conflict of interest with respect to the issues in controversy, unlesssuch interest is fully disclosed in writing to all parties and staff at the time the mediator is assigned by the commission andunless all parties agree that the mediator may serve; the mediator shall not subsequent to serving as a mediator participate inthe proceeding as a hearing examiner, advisory staff, staff counsel or expert witness, or as an attorney, expert witness, orrepresentative of any party to the proceeding;


(3) the mediator may be assigned by the commission at the same time as the commission assigns thecase to a hearing examiner; the mediator shall not discuss the mediation conference with any commissioner or hearingexaminer hearing the case;

(4) the mediator shall notify the parties and staff by telephone or mail of the time and place of themediation conference, which will be held at commission offices unless otherwise directed by the mediator; the notice maydirect the parties and staffto send the mediator, but not other parties or staff, their settlement positions and other necessaryinformation that could facilitate the mediation conference, including the results of staffs investigation of the complaint;

(5) if the parties are able to reach a settlement of their dispute, in appropriate cases the mediator shallassist the parties in preparing a written agreement to reflect that resolution; if the parties are unable to reach a completesettlement of their dispute, the mediator shall advise the parties that they may request arbitration or file a formal complaintwith the commission;

(6) nothing shall preclude the commission from using different mediation procedures.B. Arbitration:

(1) a party may request arbitration of any dispute; the party’s request shall be in writing to thecommission and shall include a concise statement of the grounds for the complaint, the remedy sought, and anacknowledgment that the party has read 17.1.2.22 NMAC and agrees to be bound by its terms;

(2) the commission or its authorized representative shall forward the request for arbitration to theother party together with a copy of Subsection A of 17.1.2.16 NMAC and 1.2.18 NMAC and require that the other partysubmit a written response within 10 days of the date of the commission’s letter forwarding the request;

(3) if the responding party agrees to arbitration of the dispute, he shall include in his response to thecomplainant’s request a concise statement of his position with regard to the merits of the complaint and an acknowledgmentthat he has read 17.1.2.22 NMAC and agrees to be bound by its terms; if the responding party will not agree to arbitration, heshall so state in the response;

(4) if the responding party either fails to respond to a request for arbitration or does not agree toarbitration, the initiating party retains the right to proceed with a formal complaint;

(5) if both the initiating party and the responding party agree to arbitration, the commission shalldesignate an arbitrator; the arbitrator may be a permanent or temporary employee of the commission or another state agencyor any other individual who is acceptable to the parties to the complaint; the designated arbitrator shall have no official,financial or personal conflict of interest with respect to the issues in controversy, unless such interest is fully disclosed inwriting to all parties at the time of the commission’s designation and all parties agree that the arbitrator may serve; the partiesshall be required to indicate their consent in writing to the designated arbitrator within 10 days of the date of thecommission’s letter of designation; if the parties request an arbitrator who is not an employee of the commission, thecommission shall not approve the request unless the parties agree in writing to bear the costs as their own pursuant toSections 8-8-4 and 62-13-3 NMSA 1978;

(6) any employee of the commission designated to arbitrate the matter under these provisions shall notparticipate in a subsequent proceeding on the complaint as a hearing examiner, advisory staff, staff counsel, or expert witnessor as an attorney, expert witness, or representative of any party to the proceeding;

(7) the commission may assign docket numbers to arbitration proceedings for purposes of recordmanagement but the proceeding remains an informal proceeding;

(8) nothing shall preclude the commission from using different arbitration procedures.C. Arbitration Procedures:

(1) once designated and approved by the parties, the arbitrator shall proceed to render a decision in thearbitration proceeding within 60 days of the date the responding party agreed to arbitration except for good cause; if thearbitrator at any time determines that it is unlikely that the dispute can be resolved without substantially affecting the interestsof other ratepayers or the public, he may so inform the parties and staff and terminate the proceeding without prejudice to theinitiating party’s right to file a formal complaint;

(2) the arbitrator shall fix a time and place for an informal hearing and shall serve notice of thehearing on both parties and on staff at least 10 days in advance of the hearing; he may issue subpoenas for the attendance ofwitnesses and for the production of books, records, documents, and other evidence and shall have the power to administeroaths; the parties and staff may offer such evidence and produce such additional evidence as the arbitrator may deemnecessary to an understanding and determination of the dispute; the arbitrator shall decide the relevancy and materiality of theevidence offered, and conformity to the New Mexico rules of evidence or to rules of evidence contained in the commission’srules, is not necessary; no stenographic or electronic record will be made of the testimony at hearing unless requested by aparty, who shall bear the cost of the record, or by staff;

(3) discovery will be permitted but only with leave of the arbitrator who shall not allow discoverywhich unduly complicates, burdens, or impedes the expeditious and informal nature of the proceeding;


(4) whenever the arbitrator deems it necessary to make an inspection or investigation in connectionwith the arbitration, he shall so advise the parties and staff, who may be present at the inspection or investigation; in the eventthat one or both of the parties or the staff are not present, the arbitrator shall make an oral or written report to the parties andstaff and afford them an opportunity to comment;

(5) at the close of or soon after the hearing, the arbitrator will issue a brief written decision; findingsof fact and conclusions of law are not necessary; the arbitrator’s decision will be binding on the parties and can beimplemented by the commission to the extent such implementation is necessary; however, the decision will not be a decisionof the commission and shall have no precedential effect;

(6) unless agreed to by all the parties and staff, no statements, admissions, or offers of settlementmade during the course of arbitration proceedings shall be admissible as evidence in any formal proceeding nor shall thearbitrator disclose the same voluntarily or through discovery or compulsory process; nothing in this section, however, shallpreclude the arbitrator from issuing a brief written decision describing his conclusions and the bases for them;

(7) nothing in this rule shall be construed to mean that the commission has waived its review of anydecision or that the commission consents to be bound by arbitration.[17.11.10.13 NMAC - Rp, 17.11.10.13 NMAC, 1/1/20187]

17.11.10.14 VARIANCES AND WAIVERS: Any person may petition the commission for variance or waiver of anyprovision of this rule for good cause shown.

A. General requirements:(1) a contributing company or ETC may petition for an exemption or a variance from any of the

requirements of this rule;(2) such petition may include a motion that the commission stay the affected portion of this rule for

the transaction specified in the motion;(3) petitions for an exemption or a variance and motions for a stay must be supported by an affidavit

signed by an officer of the contributing company or ETC or someone with authority to sign for the contributing company orETC;

(4) the commission may, at its discretion, require an informal conference or formal evidentiaryhearing prior to making its determination.

B. Contents of the petition. A petition for an exemption or variance shall:(1) identify the section of this rule for which the exemption or variance is requested;(2) describe the situation which necessitates the exemption or variance;(3) describe the effect of complying with this rule on the contributing company or ETC and its

customers, or on its competitive affiliates and their customers, if the exemption or variance is not granted;(4) describe the result the request will have if granted;(5) state how the exemption or variance will achieve the purposes of this rule and the Rural

Telecommunications Act of New Mexico;(6) state why the proposed alternative is in the public interest and is a better alternative than that

provided by this rule;(7) state why the exemption or variance would have no anticompetitive effect; and(8) state why the requested exemption or variance would not place an undue burden on the fund.

[17.11.10.14 NMAC - Rp, 17.11.10.14 NMAG, 1/1/20187]

17.11.10.15 GENERAL REPORTING REQUIREMENTS:A. Reports require declaration: all reports filed with the commission or the administrator must be filed with

a declaration from the chief financial officer of the entity or the person who prepared the reports on behalf of the entity thatthe information is correct and the filing is made subject to the penalty of perjury provided for in Section 30-25-1 NMSA1978.

B. Time for reporting: where no date is specified for a report, or when a request is made by theadministrator for information necessary for the administration of the fund, the administrator shall specify when the reportmust be filed.

C. Reporting forms: contributing companies and ETCs shall report information in the manner prescribed bythe administrator. The administrator shall not require reporting that will be unduly burdensome.

D. Electronic filing: the administrator shall accept electronic reporting when practicable.E. Confidentiality: the commission shall have access to all information reported to the administrator.

Contributing companies may request that company-specific information required by the reporting requirements of this rule betreated as confidential by so indicating at the time the information is submitted. The commission shall make all decisionsregarding disclosure of company-specific information and may request further information or justification from the


contributing company to ensure uniformity of confidential treatment of all information submitted by contributing companies.Nothing in this rule shall preclude commission issuance of an umbrella protective order identifying what reported data shallbe, or shall not be, deemed confidential. The administrator shall keep confidential all company-specific information obtainedfrom contributing companies for which confidential treatment is requested, shall not use such information except forpurposes of administering the fund, and shall not disclose such information in company-specific form unless directed to do soby the commission.

F. The commission may require the administrator to modify any of its report formats to solicit additionalinformation necessary for the administration of the state universal service program, or to delete information that is notnecessary.[17.11.10.15 NMAC - Rp, 17.11.10.15 NMAC, 1/1/2018~]

17.11.10.16 REVENUE REPORTS: Each ETC and contributing company shall submit on or before May I of eachyear a revenue report on the form prescribed by the administrator detailing its intrastate retail public telecommunicationsservices revenues for the prior calendar year.[17.11.10.16 NMAC - Rp, 17.11.10.16 NMAC, 1/1/201_87]

17.11.10.17 OTHER REPORTS: ETCs shall comply with the reporting requirements established by the commissionas set forth in 17.11.27 NMAC. In addition, on or before May 1 of each year, carriers shall report the following informationto the administrator in a form prescribed by the administrator, regarding facilities and activities during the preceding calendaryear:

A. Contributing companies, including ETCs, shall report the number and type of New Mexico access lines andNew Mexico te!ep~.ene number~ communication connections subscribed to in total and within rural areaseach New Mexicocensus tract consistent with the reporting required by FCC Form 477, and the number of such access lines and te!ephenennmbers-communication connections that are exempt from paying the SRUSF surcharge, in total and within tar!! areas.

C. Contributing companies shall report the cost of collecting universal service fund (USF) surcharges,fulfilling reporting requirements, and other administrative costs of complying with this rule.

D. ETCs shall report:(1) all revenues, compensation, payments, or subsidies received from all sources, including, but not

limited to end-user customers, the state, and the federal government;(2) all dividends or equivalents paid to shareholders, cooperative members, or others holding an

ownership interest in the ETC; and(3) compensation, including value of benefits, paid to the five highest-compensated employees of the

carrier.E. In addition, on or before July 1 of each year, ETCs receivin~ support from the fund (except those receiving

only support pursuant to 17.11.11 NMAC) shall file with the commission a report, in a form approved by the commission,

payments from the fund were used for the purpose stated in Subsection A of 17.11.10.27 NMAC2 The re~ert shall a!se

a in conjunction --~;’~" r~,~..~ ~.;m. o~o, ........ If any ETC required to fileinformation with the commission under Subsection E of 17.11.10_.-17 NMAC fails to comply on or before the applicableannua! federal ETC reporting deadline, the administrator shall withhold any disbursements otherwise due to the non-compliant ETC until the ETC has compiled.[17.) ].10.)7 NMAC - Rp, 17.11.10.17 NMAC, 1/1/201_87]

17.11.10.18 CONTACT PERSONS: All contributing companies and ETCs shall file with the administrator the name,address, phone number and e-mail address of a contact person and shall keep the information current.[17.11.10.18 NMAC - Rp, 17.11.10.18 NMAC, 1/1/201_87]

17.11.10.19 ANNUAL DETERMINATION OF FUND:A. The administrator shall determine the amount of the fund armua!!y, for the next calendar year and submit its

findings to the commission on or before September 1 of each year to enable subject te commission approval~ on or beforeOctober 1 of each year in order to provide carriers with sufficient time to implement any change in the surcharge rate.

B. In the event the commission orders a change in fund support, pursuant to 17.11.10.14 or 17.11.10.25NMAC of this rule or otherwise, that necessitates a fund size-amount greater than that which the commission has previously

EXttIBIT 1 - NEW RULE

established, the commission may order an adjustment to the size-amount of the fund, subject to the annual fund cap set forthin Subsection C of 17.11.10.19 NMAC.

C. The amount of the fund shall be equal to the sum of each ETC’s revenue requirement, calculated pursuantto this section, plus any other fund requirements determined by the commission, including pursuant to 17.11.10.25,17.11.10.31 or 17.11.11 NMAC, plus projected administrative expenses and a prudent fund balance; provided however, thetotal amount of the fund shall not exceed a cap of thirty million dollars ($30,000,000) per year.

D. Only carriers holding state ETC status as of October 1 shall be included in the calculation of fundingrequirements for the subsequent calendar year.

E. Except where the commission has established an alternative or additional amount pursuant to 17.11.10.25or 17.11.10.31 NMAC, the revenue requirement for 2018 and each year thereafter for each ETC that was eligible as of July 1,2005 and is a local exchange carrier shall be equal to the carrier’s 2014 SRUSF revenue requirement~ adjusted by the annualpercentage change in the number of access lines served by the carrier as of December 31 of the prior calendar year comparedto the number of access lines served by the carrier as of December 31, 2014, and then reduced by the carrier’s imputedbenchmark revenue. For 2018, the access lines used for the comparison to 2014 shall be as of December 31, 2016. TheSRUSF revenue requirement formula under this section may be stated arithmetically as follows: revenue requirement minusimputed benchmark revenue.

F. The revenue requirement for an ETC that became an ETC after July 1, 2005 or that became an ETC prior toJuly 1, 2005, but is not a local exchange carrier, shall be determined annually by the administrator in conjunction with theadministrator’s determination of fund size, and shall be in accordance with the support rate determined by the commissionpursuant to 17.11.10.23 NMAC.[17.11.10.19 NMAC - Rp, 17.11.10.19 NMAC, 1/1/20187]

17.11.10.20 SRUSF SUP.CHARGE CAP AND DETERMINATION OF SRUSF SURCHARGE RATE ANDCONTRIBUTION:

A. Effective as ef Janua.~’ !, 20!7 the commission shall establish a SP.USF surcharge cap by order. Theadministrator shall recommend the amount of the SRUSF surcharge rate-anmmtty for the next calendar year, on or beforeSeptember 1 to enable commission approval on or before October 1, based upon monthly and annual reports filed by ETCsand contributing companies, broadband program grants awarded by the commission, and any other pertinent and reliableinformation available to the administrator or the commission, and applying the annual fund cap set forth in Subsection C of17.11.10.19 NMAC.

C. The commission shall either set a percentage surcharge rate ~att-be-equal to the annual fund requirementdetermined by the commission divided by the sum of intrastate retail public telecommunications service revenue, or in thealternative, set a fixed charge applicable to each non-exempt communication connection equal to the annual fund requirementdetermined by the commission divided by the number of non-exempt communication connections for all contributing carriersin New Mexico.~.~.�"- ,-~ ~,~..~.,s;~-,"; ..... ~...~. o; .... in ~,~,, ~’r .... *--~,~-~,~; .... ,-~a The surcharge rate or fixed charge.may be adjusted toaccount for any material deficit or surplus projected to exist at the start of the fund year, subject to the annual fund cap.

D. Each contributing company’s monthly contribution shall equal the state rural universal service fund(SRUSF) surcharge rate multiplied by its intrastate retail telecommunications revenues or non-exempt communicationconnections, as determined bv the commission, in New Mexico for the month.

E. If, for any month the administrator fads that the fund balance is insufficient to meet the sum cf a!! ETCs’revenue requirements total obligations of the fund, (including support pursuant to 17.11.10.19 NMAC. 17.11.10.25 NMAC,17.11.10.31 NMAC, and 17.11.11 NMAC) plus administrative expenses and maintenance of a prudent fund balance, theadministrator shall prorate all payments to each ETC, with the exception of payments pursuant to 17.11.10.31 NMAC and17.11.11 NMAC. In the event the administrator determines that such a prorated reduction in payments is reasonably likely tooccur, the administrator shall immediately notify the commission and the commission will take prompt action to increasecontribution requirements, subiect to the annual fund cap set forth in Subsection C of 17.11.10.19 NMAC, to ~mal:e up orotherwise account for the shortfall and will provide for true-up payments for any underpayments occurring if proratedreduced payments are required before the contribution requirements can be increased. If the fund accumulates a surplusbeyond what the administrator and the commission believes is prudent under the circumstances, the administrator may, withthe commission’s approval, decrease contribution requirements so as to lower the fund balance to an appropriate level.

F. Each contributing company shall remit its monthly contribution to the administrator on a schedule to bedetermined by the administrator.


[17.11.10.20 NMAC - Rp, 17.11.10.20 NMAC, 1/1/201_8;]

17.11.10.21 RECOVERY OF CONTRIBUTIONS:A. A contributing company shall recover the amount of its contributions to the fund from its end-user

customers in a manner that is not, either by act or omission, deceptive or misleading. Such recovery shall be made in a fair,equitable and nondiscriminatory manner, and no over-recovery of contributions shall be permitted.

B. A contributing company required to provide service in accordance with commission approved tariffs shallnot recover contributions from its end-user customers except as permitted under commission approved modifications to thosetariffs.

C. The commission may, after notice and hearing, order modifications to a contributor’s method of recoveringcontributions from its end-user customers.[17.11.10.21 NMAC- Rp, 17.11.10.21 NMAC, 1/1/20187]

17.11.10.22 FUND DISBURSEMENTS:A. The administrator shall make a monthly disbursement to each ETC eligible to receive such a payment from

collected revenues in the fund, on a schedule to be determined by the administrator.B. The amount of each ETC’s monthly disbursement shall be one-twelfth of its revenue requirements

computed in accordance with 17.11.10.19 NMAC, subject to proration as provided in Subsection E of 17.11.10.20 NMAC.C. Only carriers holding ETC status as of October 1 shall be eligible to receive disbursements from the ftmd

during the year that begins the following January 1.D. The administrator shall not pay, and shall hold in escrow, any disbursements otherwise due to an ETC that

is also a contributing company, if that company shall not be in compliance with its contribution requirements.[17.11.10.22 NMAC - Rp, 17.11.10.22 NMAC, 1/1/201_87]

17.11.10.23 DESIGNATION OF ETCS:A. Any carrier operating in New Mexico and designated as a state ETC as of July 1, 2005 and which has not

lost that designation is automatically designated as an ETC for the purposes of this rule. If at any subsequent time a carrierloses ETC designation status, it shall no longer be eligible to receive support from the fund.

B. Other carriers may file a petition for designation as an ETC in accordance with 17.11.10.24 NMAC.C. On its own motion or in response to a petition, the commission may, after notice and hearing and for good

cause shown, modify, suspend, or revoke an ETC designation.D. Upon approval of a carrier for ETC status under these rules, the commission may, if requested, establish the

carrier’s support rate in accordance with the requirements of 17.11.10.25 NMAC. In determining a just and reasonablesupport rate for an ETC, the commission shall:

(1) consider the cost of efftciently providing services to the proposed service area, including a rate ofreturn determined by the commission to be reasonable, using the most cost-effective technologies, but also taking intoconsideration existing infrastructure;

(2) consider the amount of support available to the ETC through the federal universal service funds;(3) ensure that the support rate for a competitive carrier not exceed the equivalent support received

through these rules by the incumbent carrier or carriers serving the proposed service area.E. On its own motion or in response to a petition, the commission may modify an ETC’s support rate to reflect

more current cost information or changes in service volumes.[17.11.10.23 NMAC - Rp, 17.11.10.23 NMAC, 1/1/201_8~]

17.11.10.24 PETITIONS FOR ETC DESIGNATION AND SUPPORT RATES:A. Any entity seeking designation as a state or federal ETC must file a petition with the commission. In the

case of a petition for ETC designation and support rate, the petition shall:(1) include a description of the proposed service area for which it seeks designation that is consistent

with the federal requirements relating to service areas set forth in 47 CFR 54.207;(2) demonstrate that the entity meets the requirements in Section 214(e) of the federal act (47 U.S.C.

Section 214(e) to be designated as a federal ETC;(3) demonstrate that the proposed designation is in the public interest;(4) include the information required by 17.11.10.25 NMAC;


(5) provide a five-year plan demonstrating how support from the fund will be used to improve thepetitioner’s coverage, service quality or capacity throughout the service area for which it seeks designation;

(6) demonstrate the petitioner’s ability to remain functional in emergency situations;(7) demonstrate that the petitioner will satisfy consumer protection and service quality standards;(8) offer local usage plans comparable to those offered by incumbent local exchange carriers in the

areas for which the petitioner seeks designation;(9) acknowledge that the petitioner may be required to provide equal access if all other ETCs in the

designated area relinquish their designations;(10) demonstrate that granting ETC status to the petitioner in the designated area is likely to result in

more customer choice;(11) address the impact of designation of the petitioner on the size of the fund;(12) address the unique advantages and disadvantages of the petitioner’s service offering;(13) demonstrate the petitioner’s willingness and ability to offer service throughout the designated

service area within a reasonable time frame; and(14) provide such other information as the commission or the administrator may fmd appropriate.

B. A petition by an existing ETC for a support rate shall demonstrate that granting the proposed support rate isin the public interest and shall include the information required by 17.11.10.25 NMAC.

C. Consideration of the public interest will apply in all ETC designation and support rate proceedings. Thecommission is not required to designate additional ETCs in any service area, if not in the public interest.

D. The commission shall, after such notice and hearing as the commission shall prescribe, enter its writtenorder approving or denying a company’s petition. An order approving a petition for ETC designation shall specify theservice area for which designation is made and an order approving either a petition for ETC designation or a petition for asupport rate shall state the approved support rate.

E. The commission may approve a petition for designation as a federal ETC in conjunction with a petition fordesignation as a state ETC.

F. The commission shall require annual verification from each ETC that it continues to meet the requirementsherein for designation as an ETC and for provision of support from the fund.[17.11.10.24 NMAC- Rp, 17.11.10.24 NMAC, 1/1/201_87]

17.11.10.25 PETITION FOR SUPPORT BASED ON NEED:A. An ETC serving in a high cc,~t rural area of the state may petition the commission for support from the fund

when such payments are needed to ensure the widespread availability and affordability of re~dent’~a! !eta! encha.qge universalservice in the high-c-~rural area(s) of the state served by the ETC.

B. In addition to establishing need as described in Subsection A of this section, a petition for support based onneed shall identify the geographic area for ~vhich support is requested, and shall demonstrate with particularity how theproposed payments from the fund will be used in a manner consistent with the use of fund support requirements set forth in17.11.10.27 NMAC.

C. In support of the petition, the ETC must make available to the commission all information supplied byff_orm 481 (or a similar abbreviated form) for the four quarters prior to the petition filing date, plus New Mexico-specificff_orm 481 information if the form 481 information is consolidated. The commission may also require additional informationfrom the ETC that it deems necessary, including but not limited to information relating to the ETC’s regulated revenues,expenses, and investments, to determine whether support is needed to ensure the widespread availability and affordability ofre’~n~enfia! !~’,ca! e×chaz’,geuniversal service in the ETC’,; high c~t area in the ~tatearea identified in the petition.

Do The commission shall resolve each petition for support based on need with or without a hearing no laterthan six months following the filing date of the petition, unless the commission finds that a longer time will be required, inwhich case the commission may extend the period for an additional three months.

E. Companies reporting the use of funds granted by the commission under this section shall provide:(1) Specific details of projects for which fund support is used; itemized by the categories of capital

expenditures (CapEx) and the related operations expenditures (OpEx).(a) Project descriptions will explain the objectives or intended goal of the project. Such as

increased capacity or efficiency, redundancy, expansion of network or services.(b) Project prioritizations of buildout plans in technical terms that include locations, maps as

applicable, milestones and benchmarks to measure performance and assure compliance. The description shall also provideproject status, spending plans and metrics.

(c) Narrative of the projects explain the current and ongoing status of completion or readyfor service dates (RFS), and other pertinent facts (i.e., project delays, permit status, surveys, right of ways issues) for

10


reporting purposes. The term ready for service ("RFS") means a description of projects where construction is complete andthe project is operational.

(2) The period for the reporting of project details shall be semi-annual, at a minimum, to continue forthe period that funds are awarded.

(3) Semi-annual financial reporting on a project specific or company-wide basis, depending if theaward is specific to network improvements and projects, or for the fmancial stability of the ETC receiving the award.[17.11.10.25 NMAC - Rp, 17.11.10.25 NMAC, 1/1/20187]

17.11.10.26 COMPLIANCE WITH CONTRIBUTION REQUIREMENTS:A. If the administrator finds that a contributing company has not contributed the amount required by this rule,

the administrator shall notify the contributing company in writing. The administrator shall request the company to pay thedeficiency in its contribution.

B. The contributing company shall pay the requested amount within 21 days of the date of the notice or seekdispute resolution as provided in this rule.

C. If attempts by the administrator to collect the total requested amount from a contributing company or toresolve a dispute are unsuccessful, the administrator shall notify the commission in writing.

D. Upon request by the administrator, a complaint filed by an interested party, or on its own motion, thecommission, after providing notice and an opportunity for a hearing in accordance with 17.1.2 NMAC, may issue an orderrequiring a contributing company to pay any arrearage in contributions that the commission finds to exist and may alsoimpose interest, a fine or other appropriate administrative penalties or requirements or bonding to assure future compliancewith contribution requirements. In the event that a contributing company fails or refuses to comply with a commission orderissued pursuant to this provision, the commission may petition the appropriate district court for appropriate injunctive reliefand for enforcement of the commission’s order.

E. The commission may take the same types of action set forth in Subsection D of 17.11.10.26 NMAC in theevent that it finds, after a proceeding of the type specified in Subsection D of 17.11.10.26 NMAC, that a contributingcompany or an ETC has, in any other way, violated any provision of this rule or of the rural telecommunications act of NewMexico, Sections 63-9H-1, et seq. NMSA 1978.[17.11.10.26 NMAC - Rp, 17.11.10.26 NMAC, 1/1/2018_~]

17.11.10.27 USE OF FUND SUPPORT:A. An ETC shall use fund support in a manner consistent with the rural telecommunications act, Sections 63-

9H-1 et seq., NMSA 1978, Section 254 of the federal telecommunications act (47 U.S.C. 254), and commission rules andorders. Fund support must be used to pr-ese+ve-maintain and advanc-e-su~p_port universal service; provided, however, that eachETC receiving support pursuant to 17. l 1.10.19 or 17.11.10.25 NMAC must expend no less than sixty percent (60%) of thesupport it receives to deploy and maintain broadband internet access services in rural areas of the state. *~’o*~..~ .o;o, ....... .~ ~.v..~,:a~ ~.o"reasonable and affordable rates, access by !ow income consumer’~ and consumers, to qua!ity telecommunications and

B. If the commission f’mds, in a proceeding on its own motion or on the motion of the administrator or aninterested party, that an ETC has used fund support for purposes other than to preserve and advance universal service, thecommission may impose an appropriate administrative remedy, which may include, but need not be limited to, ordering theETC to refund amounts paid to it from the fund and withholding future payments.[17.11.10.27 NMAC - Rp, 17.11.10.27 NMAC, 1/1/20187]

17.11.10.28 ACCESS TO BOOKS, RECORDS AND PROPERTY:A. The administrator or the commission shall have access to the books of account, records and property of all

contributing companies and ETCs to the extent necessary to verify information reported or required to be reported pursuant tothis rule. The administrator or commission may direct a contributing company or ETC to send copies of records to theadministrator or commission or may inspect records at the offices of the contributing company or ETC, at the administrator’sor commission’s discretion.

B. In the normal course of business, the administrator will give at least three days’ notice of its plans toinspect records in the offices of a contributing company or ETC. The administrator may apply to the commission to procurea subpoena in order to inspect records without notice.[17.11.10.28 NMAC - Rp, 17.11.10.28 NMAC, 1/1/201_87]

17.11.10.29 REVIEW AND AUDIT OF ADMINISTRATOR AND FUND: The administrator shall provide thecommission with a financial statement of the fund and the administration of the fund on an annual basis by May 1. The

11


commission shall engage a qualified independent auditor to audit each such financial statement and to submit a writtenopinion to the commission.[17.11.10.29 NMAC - Rp, 17.11.10.29 NMAC, 1/1/201_87]

17.11.10.30 ADVISORY BOARD:A. The commission shall establish and appoint an advisory board composed of representatives from

participating contributing companies and ETCs, the attorney general, the commission staff, and any representative(s) of oneor more consumer groups or organizations that the commission may choose to appoint. The members shall include no morethan one representative from each of the following types of telecommunications carriers and entities providing comparableintrastate retail services: rural incumbent telecommunications carriers; incumbent local exchange carriers other thanincumbent rural telecommunications carriers; interexchange carriers; competitive local exchange carriers not ETC-designated; ETC-designated competitive local exchange carriers; commercial mobile radio service providers not-ETC-designated; and ETC-designated commercial mobile radio service providers. Any other type of telecommunications carriersor providers of comparable intrastate retail service may petition the commission for representation by no more than onemember of that type of carrier or service provider on the advisory board, which the commission may grant by order. Thecommission shall resolve any dispute among the carriers or service providers of each type as to who shall be the member ofthe advisory board. The members representing participating contributors shall each be appointed for a term of three years.Members of the board may be reappointed to subsequent terms with the approval of the commission. Expenses incurred by amember in connection with participation on the advisory board shall not be reimbursed from the fund.

B. The advisory board shall meet periodically with the administrator and shall provide advice and consultationto the administrator as provided under this rule. Where deemed necessary by the advisory board, it shall makerecommendations to the commission or the administrator, or both, relating to potential matters related to administration of thefund. Should the members of the advisory board not agree on a recommendation to the commission or administrator on anyparticular matter, the advisory board may provide a majority recommendation as well as a minority recommendation as to theresolution of any such identified issue. In addition, any member of the advisory board may, with advance written notice tothe other members of the advisory board, provide individual recommendations or other information to the commission andthe administrator that it deems appropriate. The advisory board is intended to be a forum within which to build consensus onmatters relating to the administration of the fund, while not deterring any interested party from communicating its concernsrelating to the administration of the fund to the advisory board, or, subject to advance written notice to the other members ofthe advisory board, directly to the commission.

C. The advisory board members shall elect a chair, vice-chair, and secretary to serve on the board for one year,subject to additional terms as elected from within the board. For the purpose of conducting business, a majority of the boardmembers present at any meeting shall constitute a quorum.[17.11.10.30 NMAC - Rp, 17.11.10.30 NMAC, 1/1/201_87]

17.11.10.31 BROADBAND PROGRAM:A. It is the goal of the commission that New Mexico consumers have access to high-quality broadband service

from both wireline and mobile broadband providers. Pursuant to Subsection N of Section 63-9H-6, NMSA 1978, ETCs mayseparately apply to the commission for grants to fund the construction of facilities that are capable of providing ~

intemet access service~ to areas unserved or underserved by broadband in the state. Each grant that is awarded will provideup to seventy five percent of the budgeted project cost with the ETC applying the remaining tv,’enty five percentremainderfrom its own funds. Projects receiving any other-source of third-party funding other than potential loan funds, FCC high-costfund legacy support or e__Connect a_America ff_und support (including Mobility Fund support) will not be eligible. I.__~nevaluating applications, the commission shall seek to avoid duplication of service using the same technology. Awards ofsupport under this section shall be consistent with federal universal service support programs and be based on the best use ofthe fund for rural areas of the state. For purposes of administering the broadband program, the commission may find that abroadband program proposed project area is a rural area, notwithstanding the definition of rural area in Section 17.11.10.7(U)NMAC, if it determines that (a) the area otherwise has the characteristics of a rural area, (b) the area is unserved orunderserved by broadband, and (c) the public interest requires that the area be classified as rural.

B. Funding of the broadband program. Beginning in g04~7-2018, and each year thereafter, at least five milliondollars ($5,000,000) of the fund shall be dedicated annually to the broadband program_, wi!! be Sanded by an amount equal to

C ef 17. ! I. 10.20 NMAC. The amount of funding allocated to the broadband program shall not be subject to proration underSubsection E of 17.11.10.20 NMAC. To the extent a year’s broadband program funding is not exhausted by grants awardedduring that year, the funds will rollover to the following year.

12


C. Applicants for broadband program grants may request that company-specific information contained withinan application be treated as confidential. The commission shall make all decisions regarding disclosure of company-specificinformation and may request further information or iustification from the contributing company to ensure uniformity ofconfidential treatment of all information submitted by contributing companies. Nothing in this rule shall precludecommission issuance of an umbrella protective order identifying what reported data shall be, or shall not be, deemedconfidential. The commission staff or a third-party contractor, shall keep confidential all company-specific informationobtained from applicants for broadband program grants for which confidential treatment is requested, shall not use suchinformation except for purposes of analyzing the applications, and shall not disclose such information in company-specificform unless directed to do so by the commission.

_D~;. Minimum requirements for eligible projects. The commission will consider projects on a technology-neutral basis. Projects that apply technologies including, without limitation, wireline, mobile wireless, and fixed wirelesstechnologies are all eligible for broadband fund grants. A project must meet the following requirements to be eligible for agrant award:

(1) support broadband internet access service at speeds of at least ~ mMbps download!one-1mM_I_bps upload to all households and businesses in the proposed project area;

(2) support voice grade telephony service to all households and businesses in the proposed projectarea. For this purpose, a voice over internet protocol (VOIP) based service is acceptable, as well as traditional voicetelephony services and mobile voice service~; and

(3) Support access to emergency 911 services.El). Contents of grant applications. An application for support from the broadband program shall include~ at a

minimum:(1)

designated as a state ETC;(2)

of constructing facilities;O)

providing;

a proposal to build telecommunications network facilities to service an area where the applicant is

a detailed build plan setting forth a description of the facilities to be deployed, including all costs

a map showing where service and coverage will be provided; this requirement can be met by

(a) for a wireline network, a map showing all homes, businesses, and other end userlocations passed;

(b) for a wireless network, a coverage map generated using a radio frequency propagationtool generally used in the wireless industry;

(4) an estimate of the number of road miles and square miles to be covered and population andpopulation density of the area covered;

(5) the amount of support requested from the broadband program and the amount of the applicant’sfinancial match, and a description of any type, amount, and purpose of subsidy or financial support the applicant is currentlyreceiving or is scheduled to receive in the area designated in the application;

(6) a description of the technology to be deployed, including data throughput speeds and latencycharacteristics of the service to be delivered to customers;

(7) a demonstration that the area to be served is an area unserved by broadband or an area underservedby broadband as defmed in 17.11.10.7 NMAC. If the area to be served contains both unserved and underserved areas, theapplication shall identify which portions of the area are unserved and which are underserved;

(8) a demonstration of~that-the estimated customer subscription rates and revenues from the servicesto be offered as a result of the proposed construction ;;’eu!~ be insufficient to justify the preject witheut support from thebroadband program;

(9) a commitment to provide a minimum twenty five percent match of funds drawn from thebroadband program;

(10) if the project is a wireless network deployment, a commitment to allow collocation on reasonableterms by other providers of commercial mobile wireless service or any public safety network and to abide by the FCC’scollocation requirements for awardees under the federal universal service program;

(11) sample terms and conditions for the service and proposed prices;(12) a certification by an authorized representative stating whether the aFp!icant i~ receiving er

preject .... affirming that all other-information set forth in theapplication is true and correct; and

(13) any other requirements to ensure accountability as the commission may develop and approve in aproceeding to determine the form and contents of grant applications.

FE. The ETC must make the following commitments and include them in its proposed application:

13


O)services in urban areas;

(2)completion;

the voice and broadband service must be offered at reasonably comparable rates for comparable

the voice and broadband service must be provided for at least five years following project

the ETC must abide by commission reporting requirements sufficient to monitor the progress ofthe project deployment and to ensure that all grant funds are being used efficiently and for the purpose intended.

(~5) the ETC must commit to respond to commission inquiries regarding service-related complaintsand commit to attempt to resolve service-related complaints in a reasonable manner.

_GF. Procedure for awarding support from the broadband fund:(1) ~ ....... p ....;.~n.,~a~,a,o~,;~¢l,7 11 1~ ~1 ~,~At~, oriOn orbeforeMay1 ofeach

year, the commission shall open a proceeding and establish a 30 day window for filing applications for broadband programsupport for the following calendar year. The commission staff, or a third party contractor, shall review all timely applications.

meth~dc!ogy: Applications to bui!d te!ec~’-unicaticns network facilities ":A!! have the p~en ~fthe un~e;,’ed areas ~n the

~) Interested persons may seek inte~ention in ~ese proceed~gs, p~su~t to 1.2.2.23 ~AC.~4) On or before September 1, ~e co~ission’s stuff, or a t~d-p~ con~actor, shall~ m&e a

.............. a o Thepresentation to ~e co~ission with analysis of the applications for awards recommendatians for o-vvcommission’s staft~ or a third-pa~y contractor, may communicate with applicants to request additional info~ation or clariDintb~ation presented in the applications in order to prepare its- presentation. T~e app!icants and any intep,’eners maycha!!enge suc~ recommendations. Such recommendations presentations shall be considered by the co~ission but shall notb~d the co~ission.

(4) On or before October 1, the commission shall issue a decision approving, denying, or modiDing,in whole or in pa~, each application. Selection ofproiects will prioritize ~se~ed, undersexed, and se~ed areas, in thatorder.

(5) On or before ~November 1, ~y applicant interested person may file with ~e co~ission arequest for reco~ideration of the disposition, in whole or in pa~, of any award of broadb~d ~dsa denial of ira application.

(6) On or before December 1, ~e co~ission shall approv~ deny, or modiD suppo~ aw~ds by afinal order.

~g. Conditions for disb~semem of aw~ded ~nds:(1) The aw~dee co--its to complete cons~ction of its project ~t~n ~t~ee.ye~s ~om the

~date of the initial disbursement made pursuant to paragraph (3) of Subsection H of 17.11.10.31 ~AC.(2) For each awarded project, proiect repots shall be submitted to Stuff, consultant(s), and/or

administrator(s) semiannually ~at provide the t~es ofinfo~ation described in 17.11.10.25(E) NMAC. Wi~ 30 daysaRer project completion, ~e aw~dee shall submit a repo~ demons~at~g tMt the project ~ completed meets ~e coveragerequkements set fo~ in the application, ~clud~g a ceaification ~om an officer or dkector ~at all program requ~ementshave been met.

(3) The a~s~ator shall disburse ~�* ............third of~e awed w~en madeat the beginning ofthe project as dete~ined by the Commission, one thkd at the midpoint of the proiect, and the remaining third upon projectcompletion. The second and third payments are contingent upon the ~ percent of tke aw"~d ~ 5 daya after submissionof~acceptable project comp!etian status repo~f! ~pursuant to P~agraph (2) of Subsection ~G of 17.11.10.31 ~C.The co~ission may, ~in 30 days after submission of a repot, order additional info~ation to be provided, suspendpa~ent by ~e ad~s~ator, or take other action as necessa~ aRer notice and heafin~ and order additiana!

(4) ~y applicant fo~d to haw will~lly misrepresented ~fo~ation in an application, is fo~d tohaw used suppo~ unla~lly, or fails to meet the continents set fo~h ~ the application, may be sub~¢ct to ~r¢~d

14


all-award funds or other actions of the C,~mmi~i,~-;~n;-*~l ....n .1~11 1~ subject

[17.11.10.31 ~AC- Rp, 17.11.10.31 ~AC, 1/1/2018~]

HISTORY OF 17.11.10 NMAC:Pre-NMAC History: None.

History of Repealed Material:17 NMAC 13.10, State Rural Universal Service Fund (filed 11/15/2005) repealed effective 01/01/2015.17 NMAC 11.10, State Rural Universal Service Fund (filed 01/01/2015) repealed effective 01/29/2016.17 NMAC 11.10, State Rural Universal Service Fund (filed 01/01/2015) repealed effective 01/01/2017.

Other History:17 NMAC 13.10, State Rural Universal Service Fund (filed 12/15/1999) was replaced by 17.11.10 NMAC, State RuralUniversal Service Fund, effective 01/01/2015.17.13.10 NMAC, State Rural Universal Service Fund (filed 1/1/2015) was replaced by 17.11.10 NMAC State RuralUniversal Service Fund, effective 1/29/2016.17.13.10 NMAC State Rural Universal Service Fund (filed 1/19/2016) was replaced by 17.11.10 NMAC State RuralUniversal Service Fund, effective 1/1/2017.K:\NMECG - SRUSF Rulemaking 2017\Other Docs\17 11 10 NMAC Title 17 Public Utilities and Utility Services - redline 07-26-2017.docx

15

BEFORE THE NEW MEXICO PUBLIC REGULATION COMMISSION

IN THE MATTER OF POTENTIAL )AMENDMENTS TO STATE RURAL )UNIVERSAL SERVICE FUND RULE 17.11.10 )NMAC, PURSUANT TO RECENT )AMENDMENTS TO NEW MEXICO RURAL )TELECOMMUNICATIONS ACT )

)

Case No. 17-00077-UT

CERTIFICATE OF SERVICE

I HEREBY CERTIFY that a true and correct copy of the foregoing Final Order

Adopting Rule issued by the New Mexico Public Regulation Commission on December 7,

2017, was sent via email on December 7, 2017, to the parties listed below:

Leo BacaJeffrey AlbrightMichael TamburinoJean SnopkowskiPatricia S-IvesAlan P. MorelAnthony SmithBrooks E. HarlowCarol DentonCecile ArchibequeChristie PerezDale LamanDanielle FrappierDave ConnDavid BaileyDavid LafuriaDebra McGuire MercerLisa TatkirKristie InceLourdes VifiasMarco GonzalesMarcy GuillenMark CostlowMary Beth Cicala

Leo.baca@centur¥1ink.com;[email protected];[email protected];[email protected];[email protected];apmpa@valomet, corn;anthon¥@zianet.com;[email protected];[email protected];cecile@_’~ccatelecom.com;christie.perez@verizon, com;[email protected];[email protected]:[email protected];[email protected];[email protected];mercerdm@~tlaw.com;[email protected];[email protected];[email protected];[email protected];[email protected];[email protected];[email protected];

Certificate of ServiceCase 17-00077-UTPage 1 of 6

Matthew HooverMelanie O’ReillyMichael DukeMichael LeybaLynn E. MostollerMichelle AustinMitchell F. BrecherAmy PoppsKirk LeeMichael BagleyPeggy BrieshCheryl C. PowersJudith A. RileyGary RodhamCatherine HannanJohn JonesSharon ThomasElizabeth AguinagaJane HillZianetJessica RennekerDan WheelerAlan HermanSteve GattoMark A. OzanickCourtney SpearsCarol CliffordGil ArvisoKelly FaulBruce ThroneAmy GrossN. BurslemKaren KilgoreR. HannaR. GavidiaRussell SarazenM. GruenhutJulie DollenmayerGeorge ThomsonTom OlsonArt HullTrudy LongneckerEddie MishanJason BrownJoan M. Engler

Certificate of ServiceCase 17-00077-UTPage :~ of 6

[email protected];[email protected];[email protected];mi le~/[email protected];[email protected];[email protected];[email protected];[email protected];[email protected];michael.bagley1 @verizonwireless.com;peRRybvtonl¥@bacavalley.com;[email protected];[email protected];[email protected];[email protected];][email protected];[email protected];[email protected];[email protected];anthon¥@zianet.com;[email protected];[email protected];[email protected];[email protected];[email protected];[email protected];carol@thej onesfirm.coIn;gil. arviso@¥ahoo.com;kell¥[email protected];[email protected];[email protected];ninaburslem@imagitel, com;kkilgore@cuddgrnccarth~,.com;[email protected];[email protected];[email protected];[email protected];j [email protected];[email protected];[email protected];arthull 1 @grnail.com;[email protected];[email protected];j [email protected];[email protected];

D. JamesCY HardySharma PurcellSusan CockerhamPatrick D. CrockerCholla KhouryDonna DanielleLinda DallaeroGayle GoukerMary HopePaula FoleyCarolyn WolfLance J.M. SteinhartHerve AndrieuJerry NussbaumWarren FischerWilliam CabralDameshia SmithPaul MastersMichael LozichSteven DorfG. CookmanDiane PetersJohn JenningsKen DawsonMarsha PokomyAnnabelle PachecoDanny GrayM. GrahamTeri OhtaDonald EachusGene DeJordyGeorge ClarkGerald F. ZollarsGodfrey EnjadyJace ColbertJack PestanerJane YeePaul R. ChapmanJenna BrownJennifer KeenJeremy SmucklerJessica MatushekJohn ClarkJon Brinton


dj ames4485@c~,bermesa.com;[email protected];[email protected];[email protected];contact@nationwidere~ulatorycompliance.com;[email protected];Dgl [email protected];[email protected];[email protected];[email protected];[email protected];[email protected];[email protected];[email protected];[email protected];wfischer@qsiconsulting, com;[email protected];[email protected];[email protected];[email protected];[email protected];[email protected];[email protected];jj [email protected];[email protected];[email protected];[email protected];[email protected];[email protected];[email protected];[email protected];gene@dakel~/n.com;george, clarke@state, nm. us;j zollars@fastmail, fm;genj ad~,@matinetworks.net;[email protected];accounts@c’~bermesa.com;[email protected];pchapman@cabq, gov;[email protected];[email protected];j [email protected];[email protected];[email protected];ion [email protected];

Jules CoffmanKasey C. ChowKate DuttonKeith NussbaumKelley WellsKelly HebbardKevin BartleyLakisha TaylorNick KyriakidesRalph DichyRaymond CowleyKenneth SchifmanRichard MontoBrian GilbertSharon MullinShawn HansonSherry BoydLaura DalyScott KlopackSonya BlackwellBrian GilbertStanley SmithKyle J SmithSteve ReynoldsSteven ChernoffSteven D. MettsTim GoodwinTim KeeferTimothy ShafferyDavid RobinsonTroy JuddVictoria WilliamsWilliam P. HuntEdwin ReeseJohn BadalJanice BadalDonna DanieleSandra McNabbKitty J. CraemerVirgil BarnardJohn FrancisJennifer DwanJean ParkerRobin TaylorMatthew Ford


jcoffman@pn~snail.com;[email protected];[email protected];[email protected];[email protected];[email protected];[email protected];[email protected];[email protected];rdich¥@mettel.net;rcowle¥@ingts.com;[email protected];[email protected];[email protected];[email protected];[email protected];[email protected];[email protected]~;[email protected];[email protected];[email protected]@ioneswalker.com;Kyle.J.Smith [email protected];[email protected];scherno [email protected];[email protected];tim. goodwin@centurylink, [email protected];[email protected];D [email protected];[email protected];[email protected];[email protected];[email protected];[email protected];j [email protected];dgl [email protected];[email protected];[email protected];[email protected];j [email protected];i [email protected];[email protected];[email protected];[email protected];

Bill TemplemanLeo GarzaLauna WallerJames Boyd EvansDavid ZieglerLoretta MartinezJavier RodriguezRick ThayerJuan SaenzMark LammertDavid LaFuriaCharles FerrellWayne GibsonMaria SanchezAllison BloomAvelino IglesiaDale SniderJohnny MontoyaChristopher CollinsJoseph YarJoan Ellis-PRCEugene Evans-PRCRussell Fisk-PRCKen Smith-PRCMark Cessarich-PRCMike Ripperger-PRCGeorgette Ramie-PRCCommissioners and AssistantsSteve MeradithJerome BlockAmanda EdwardsCarla BondLuther EakinsRobert W. SpanglerD. MasseyScott KlopackSonya BlackwellBrian GilbertJane YeePaul R. ChapmanSandra SkogenCatherine NicolaouBobbie CollinsDale LamanArthur Martinez

[email protected];[email protected];[email protected];[email protected];david.l.ziegler@Centur¥1ink.com;[email protected];jrl 515 @att.com;[email protected];[email protected];[email protected]@fcclaw.com;[email protected];[email protected];[email protected];[email protected];[email protected];[email protected];[email protected];[email protected];[email protected];[email protected];[email protected];[email protected];Ken. Smith 1 @state.nm.us;[email protected];[email protected];[email protected];PRC-Commissioners&Assistants;[email protected];i [email protected];[email protected];[email protected];[email protected];[email protected];[email protected];[email protected];[email protected];[email protected];[email protected];[email protected];[email protected];[email protected];[email protected];[email protected];[email protected];

Certificate of ServiceCase 17-00077-UTPage ,~ of 6

Adriana BadalAdriana BadalTim ShafferyKim LegantSusan Bitter Smith

[email protected];[email protected];tshaffer¥@cellularoneaz.com;[email protected];[email protected];

DATED this 7th day of November, 2017.

NEW MEXICO PUBLIC REGULATION COMMISSION

Kath~en M. Segu~a, La’~Je~l~ ~


BEFORE THE NEW MEXICO PUBLIC REGULATION … Order... · 17. NMECG, in its response comments,...

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