Tag Archives: RDOF

US Bill introduced in Senate to return defaulted broadband grants to states

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Senator Hawley’s website reports…

Today, U.S. Senator Josh Hawley (R-Mo.) introduced new legislation to help deliver reliable internet to more rural Americans by returning dormant federal funding back to the state it was intended for.

“Missourians and rural Americans across the country are losing out on internet service thanks to failed funding policies,” said Senator Hawley. “My bill would put states in charge of their own broadband funding—not government-backed companies that overpromise and under-deliver.”

The Federal Communications Commission’s (FCC) current funding structure favors large companies that reap billions in federal government contracts meant to provide high-speed internet access to rural communities. These companies, however, often fail to meet obligations, leaving federal funds in default and America’s rural communities without internet service.

So far, the FCC’s Rural Digital Opportunity Fund has seen more than $2.8 billion in defaulted funds.

Senator Hawley’s Broadband Fairness Act would:

  • Allocate defaulted FCC funds to the state that originally received the award for broadband deployment;
  • Ensure that the geographic region where an award defaulted is eligible for other broadband funding opportunities; and
  • Allow states to supplement other grant funding to complete broadband projects.

The Missouri Farm Bureau has endorsed Senator Hawley’s legislation.

Full text of the Broadband Fairness Act is available here.

This could have a large impact on Minnesota, where LTD Broadband was awarded and then defaulted on $311 million.

The FCC offers guidance for providers who may default on RDOF and CAF goals

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The FCC reports…

With this Public Notice, the Wireline Competition Bureau (WCB or Bureau) provides guidance to Rural Digital Opportunity Fund (RDOF) and Connect America Fund (CAF) Phase II support recipients and other stakeholders regarding the processes for provider defaults.[1]  Support recipients are showing significant progress in meeting their deployment milestones, as noted below, and there is no demonstrated need for widespread relief from the RDOF and CAF Phase II default penalties.  Given the flexibility available under the existing default processes and other Commission rules and the lack of demonstrated need for broad relief, as well as our strong interest in preserving the integrity of the Commission’s broadband deployment programs, we decline to provide a blanket amnesty.

However, we recognize that certain carriers may not be able to meet their broadband deployment obligations[2] or have experienced changed circumstances that may impact their deployment.  To ensure that high-speed broadband is deployed across the country, close coordination between the Commission’s high-cost programs and other federal broadband deployment programs is critically important.  In recent months, the Bureau has quickly responded to default requests for these high-cost programs, has approved transfers of deployment obligations to other carriers which avoids support payment recovery and default penalties, and has waived Commission rules where warranted to reduce support payment recovery and default penalties.  The Bureau also has the ability, where good cause exists based on individual circumstances, to waive other non-compliance rules for defaults in these high-cost programs.

[1] This Public Notice builds on previously issued guidance regarding engagement with states and Tribal governments.  See Wireline Competition Bureau Provides Guidance to High-Cost Support Recipients Regarding Engagement with States and Tribal Governments to Determine Eligibility of Locations for the BEAD Program and to Avoid Duplicative Funding, WC Docket No. 10-90 et al., Public Notice, DA 23-1115 (WCB Nov. 29, 2023).

[2] See Letter Seeking RDOF and CAF II Amnesty from 69 Internet Service Providers, Trade Associations, State and Local Officials, School Districts, and Civil Society Organizations from Gigi Sohn, Executive Director, American Association for Public Broadband, to Jessica Rosenworcel, Chairwoman, WC Docket No. 19-126 et al. (filed Feb. 28, 2024) (Entity Letter) (requesting broad amnesty from default penalties for RDOF and CAF Phase II participants to encourage early defaults).

To ensure federal deployment funds reach the locations where they are needed, we strongly encourage carriers contemplating defaulting on their deployment obligations under the Commission’s competitively bid high-cost programs to reach out to the Bureau, and to the relevant state or territory broadband offices or Tribal governments, about their situation as soon as possible.  Earlier defaults can limit the support recovery and penalty costs to the carrier and also ensure that states and territories timely receive the necessary information for their Broadband Equity, Access, and Deployment (BEAD) planning.  Earlier defaults also ensure that our sister federal agencies timely receive this information to target funding for their broadband deployment programs.[1]

[1] Broadband Interagency Coordination Act of 2020, Pub. L. No. 116-260, § 904, 134 Stat. 1182, 3214 (codified at 47 U.S.C. § 1308 et seq.) (BICA) (requiring the Federal Communications Commission, the Department of Agriculture, and the National Telecommunications and Information Administration to “enter into an interagency agreement requiring coordination between the covered agencies for the distribution of funds for broadband deployment . . . .”).

This seems like a good step to allowing providers to report issues to open up communities to funding alternative routes for getting better broadband.

MN PUC agrees to allow LTD Broadband to relinquish ETC status in RDOF-specific area only

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The Minnesota Public Utilities Commission (PUC) posted an update to the case regarding LTD Broadband’s ETC designation. (This has been an ongoing story for some times, you can check out this fairly recent recap of events to catch up.) They have granted LTD Broadband’s request to relinquish the designation only in the areas in the impacted by RDOF…

In the Matter of a Petition to Initiate a Proceeding to Revoke the Expanded Eligible Telecommunications Carrier Designation of LTD Broadband LLC and Deny LTD’s Funding Certification for 2023

In the Matter of the Petition of LTD Broadband LLC to Expand Its Designation as an Eligible Telecommunications Carrier

The above-entitled matter was considered by the Commission on June 6, 2024, and the following disposition made:

Granted LTD Broadband’s Request to relinquish the Company’s RDOF ETC designation in the census block identified in the Commission’s June 3, 2021 order in Docket No. P-6995/M-21-133.

This decision is issued by the Commission’s consent calendar subcommittee, under a delegation of authority granted under Minn. Stat. § 216A.03, subd. 8 (a). Unless a party, a participant, or a Commissioner files an objection to this decision within ten days of receiving it, it will become the Order of the full Commission under Minn. Stat. § 216A.03, subd. 8 (b)

The update includes LTD Broadband’s recent letter to the PUC…

Re: Docket No. Docket No. P-6995/M-21-133 Application of LTD Broadband, LLC for Designation as an Eligible Telecommunications Carrier for Purposes of Receiving Rural Digital Opportunities Fund Support

Dear Mr. Seuffert,

I am writing on behalf of LTD Broadband, LLC (“LTD Broadband”) regarding the ETC expansion granted to us by the Minnesota Public Utilities Commision on June 3, 2021. Weare requesting to relinquish this expansion as it pertains to the ETC designation for RDOF only as it was obtained as a requirement for our successful bids in the Federal Communications Commission’s (“FCC”) Rural Digital Opportunity Fund (“RDOF”).

Our application for Authorization as it pertains to RDOF was specifically tied to the census blocks in which we were slated to receive RDOF support. However, subsequent developments have led to a change in circumstances. The Wireline Communications Bureau (“Bureau”) denied our RDOF “Long Form” application, which we then appealed to the FCC. Unfortunately, the FCC upheld the Bureau’s decision, resulting in LTD Broadband not receiving any RDOF support to provide service in the state.

This outcome has left us disappointed and puzzled, as the FCC’s decision seems to contradict the very purpose of RDOF: to connect unserved and underserved Americans. Given these developments, and in accordance with 47 U.S.C. § 214(e)(4) as well as Minnesota 7811.1400 ETC Designation in regards to relinquishment of universal service, which allows an ETC to relinquish authorization under certain conditions, we respectfully request to relinquish the authorization of ETC as it pertains to RDOF.

Please be aware that while this request pertains to our ETC Authorization designation for RDOF only, our CAF2 ETC designation remains in place. Also the unregulated broadband service provided under LTD Broadband remains available in the state, and this request for relinquishment of RDOF ETC designation will have no impact on those subscribers.

Here’s an abridged version of what the Office of Administration Hearings recommended…

Based upon the submissions of the parties, pursuant to Minn. R. 1400.5500, .5900, .6600, .7600 (2023), and for the reasons explained in the accompanying Memorandum, the Administrative Law Judge issues the following:

ORDER

  1. The Motion is CERTIFIED to the Commission.
  2. Further proceedings in this case are CANCELLED, and jurisdiction over this matter in its entirety is REFERRED to the Commission.

MEMORANDUM

Under Minn. R. 1400.5900, parties to a contested case may informally dispose of a matter by stipulation at any point during the proceedings. Further, under Minn. R. 1400.7600, a party may request that a pending motion be certified to the agency. In considering a request for certification, the Administrative Law Judge must consider whether a final determination by the agency will advance the ultimate termination of the hearing and whether the issues are solely within the expertise of the agency.1 Additionally, the Administrative Law Judge has the authority to make orders as deemed appropriate and may do all things necessary and proper to the adjudication of a contested case matter.2

In this case, based upon LTD’s notice that it seeks to relinquish its expanded ETC designation, the parties agree that this matter should be referred to the Commission for consideration of a final decision. The Administrative Law Judge concurs that no further contested case proceedings are necessary and that jurisdiction should be returned to the Commission so that it may consider LTD’s petition and issue a final order. Therefore, she CERTIFIES the Motion to the Commission under Minn R. 1400.7600(B), (F), and refers jurisdiction over this case in its entirety to the Commission pursuant to the parties’ stipulation and Minn. R. 1400.5500(J), (Q), .5900.

MN Administrative Law Judge refers LTD Broadband case to MN PUC

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The Minnesota Public Utilities just posted the following letter from the Office of Administration Hearings…

In the Matter of a Petition to Initiate a Proceeding to Revoke the Expanded Eligible Telecommunications Carrier Designation of LTD Broadband LLC and Deny LTD’s Funding Certification for 2023

In the Matter of the Petition of LTD Broadband LLC to Expand Its Designation as an Eligible Telecommunications Carrier

ORDER FOR CERTIFICATION AND REFERRAL

This matter is pending before Administrative Law Judge Jessica A. Palmer-Denig upon a petition filed by LTD Broadband LLC (LTD) to relinquish its expanded designation as an eligible telecommunications carrier (ETC), and a joint Notice of Informal Disposition and Joint Motion for Referral (Motion) submitted by all of the parties in this matter.

Corey Hauer, Chief Executive Officer, appears on behalf of LTD, without legal counsel;

Richard J. Johnson, Katherine J. Marshall, and Dan Lipschultz, Moss & Barnett, P.A., appear on behalf of the Minnesota Telecom Alliance and the Minnesota Rural Electric Association;

Richard Dornfeld, Assistant Attorney General, appears on behalf of the Minnesota Department of Commerce;

Peter G. Scholtz, Assistant Attorney General, appears on behalf of the Office of the Attorney General–Residential Utilities Division;

Ry Marcattilio-McCracken, Associate Director for Research, appears on behalf of the Institute for Local Self-Reliance; and

Marc Fournier and Sally Anne McShane have appeared as staff of the Minnesota Public Utilities Commission (Commission). [204857/1] 2

Based upon the submissions of the parties, pursuant to Minn. R. 1400.5500, .5900, .6600, .7600 (2023), and for the reasons explained in the accompanying Memorandum, the Administrative Law Judge issues the following: ORDER

1. The Motion is CERTIFIED to the Commission.

2. Further proceedings in this case are CANCELLED, and jurisdiction over this matter in its entirety is REFERRED to the Commission.

For background, I posted the following earlier today…

MN PUC Resolution in sight for LTD Broadband
The Minnesota Public Utilities Commission has been looking at revoking LTD Broadband’s ETC status, a status they need to receive federal (RDOF) funding. Last week, LTD sent a note saying they’d like to relinquish their ETC status for RDOF but retain ETC status for other funding opportunities (CAF2). Soon after the PUC posted a notice from the Attorney General recommending that MN PUC consider LTD Broadband’s Petition to Relinquish ETC.

MN Attorney General recommends PUC consider LTD Broadband’s Petition to Relinquish ETC

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The Minnesota Public Utilities Commission has been looking at revoking LTD Broadband’s ETC status, a status they need to receive federal (RDOF) funding. (The PUC recently posted a fairly condensed reminder of all the twists and turns in this story.) Earlier this week, LTD sent a note saying they’d like to relinquish their ETC status for RDOF but retain ETC status for other funding opportunities (CAF2). Today the PUC posted a notice from the Attorney General recommending that MN PUC consider LTD Broadband’s Petition to Relinquish ETC…

In the Matter of Petition to Initiate a Proceeding to Revoke the Expanded Eligible Telecommunications Carrier Designation of LTD Broadband, LLC & Deny LTD’s Funding Certification for 2023

In the Matter of the Petition of LTD Broadband, LLC to Expand its Designation as an Eligible Telecommunications Carrier

NOTICE OF INFORMAL DISPOSITION AND JOINT MOTION FOR REFERRAL

The parties, by and through their undersigned counsel or representative, stipulate that the above-captioned matters be resolved without resorting to further litigation.

As and for such resolution, LTD Broadband, LLC, shall continue to seek—and may not withdraw—its pending Petition to Relinquish that seeks Minnesota Public Utilities Commission approval to voluntarily relinquish its eligible telecommunications carrier status in the census block groups identified in Exhibit 1.1 The Minnesota Department of Commerce, Office of the Attorney General-Residential Utilities Division, Minnesota Telecom Alliance and Minnesota Rural Electric Association, and Institute for Local Self Reliance shall not oppose LTD Broadband’s Petition to Relinquish.

Because this stipulation resolves the dispute in the above-captioned matters, the parties respectfully move the Administrative Law Judge to close this file and refer the matter back to the Commission for consideration of LTD Broadband’s Petition to Relinquish pursuant to Minn. R. 1400.5900, .6600 (2023).

LTD Broadband tells MN PUC they don’t want ETC designation for RDOF

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The Minnesota Public Utilities Commission posted a letter received from LTD

The Minnesota Public Utilities Commission (PUC) posted a letter from LTD Broadband president related to the revocation of their ETC designation…

Dear Mr. Seuffert,

I am writing on behalf of LTD Broadband, LLC (“LTD Broadband”) regarding the ETC expansion granted to us by the Minnesota Public Utilities Commision on June 3, 2021. We are requesting to relinquish this expansion as it pertains to the ETC designation for RDOF only as it was obtained as a requirement for our successful bids in the Federal Communications Commission’s (“FCC”) Rural Digital Opportunity Fund (“RDOF”).

Our application for Authorization as it pertains to RDOF was specifically tied to the census blocks in which we were slated to receive RDOF support. However, subsequent developments have led to a change in circumstances. The Wireline Communications Bureau (“Bureau”) denied our RDOF “Long Form” application, which we then appealed to the FCC. Unfortunately, the FCC upheld the Bureau’s decision, resulting in LTD Broadband not receiving any RDOF support to provide service in the state.

This outcome has left us disappointed and puzzled, as the FCC’s decision seems to contradict the very purpose of RDOF: to connect unserved and underserved Americans. Given these developments, and in accordance with 47 U.S.C. § 214(e)(4) as well as Minnesota 7811.1400 ETC Designation in regards to relinquishment of universal service, which allows an ETC to relinquish authorization under certain conditions, we respectfully request to relinquish the authorization of ETC as it pertains to RDOF.

Please be aware that while this request pertains to our ETC Authorization designation for RDOF only, our CAF2 ETC designation remains in place. Also the unregulated broadband service provided under LTD Broadband remains available in the state, and this request for relinquishment of RDOF ETC designation will have no impact on those subscribers.

Bank ranking and federal funding: FCC won’t use Weiss ratings for one year

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Broadband Breakfast follows the reasons and realities behind the FCC’s decision to quit using Weiss ratings for banks’ letters of credit of RDOF, CAF II winners for one year…

 In January, Consolidated Communications notified federal regulators about a financial issue that had cropped up, could do harm to hundreds of broadband Internet Service Providers, and frustrate the effort to deliver high-speed Internet service to rural America.

In a filing with the Federal Communications Commission, Consolidated said the bank from which it had received a letter of credit (LOC) – a requirement under the Rural Digital Opportunity Fund auction rules – was no longer an eligible lending institution.

Although the FCC did not provide data, the agency in the Consolidated filing was evidently looking in broad terms at a problem that involved hundreds of banks that were backstopping millions of dollars pledged to the FCC as protection against auction winners that defaulted or otherwise underperformed in a manner that would trigger payment to the agency.

Under the FCC’s rules, an LOC had to come from a bank with a Weiss rating of at least B-minus. Consolidated’s bank had just dipped to C plus. The FCC’s rules stipulated that an inferior Weiss rating required the suspension of RDOF support until the auction winner found a new bank with a Weiss rating with at least a B minus.

Finding a new LOC provider can take time and involve additional expense. The FCC’s rules said an LOC from a qualified bank had to be equal to the amount of RDOF support in the first year.

Consolidated sought a six-month waiver from the Weiss requirement, which the FCC granted shortly thereafter. Based in Mattoon, Il., Consolidated has about 393,000 broadband subscribers located in more than 20 states.

That’s just the first chapter but it speaks to the intricacies behind every aspect of every question on these federal applications and the frustration of these intricacies.

MN PUC chooses dates for LTD Broadband case

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Two weeks ago, the Minnesota Public Utilities Commission held a pre-hearing conference call on the petition to Initiate a Proceeding to Revoke the Expanded Eligible Telecommunications Carrier Designation of LTD Broadband LLC and Deny LTD’s Funding Certification for 2023. Today they released notes from the call, which includes background, specifics on next steps and a timeline:

LTD Broadband files petition to review FCC’s decision to deny them RDOF money

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Broadband Breakfast reports…

LTD Broadband has filed a petition for review of the Federal Communications Commission’s decision to deny it funding as part of the Rural Digital Opportunity Fund.

The company, which largely offers fixed wireless broadband, filed a request for judicial review with the D.C. Circuit Court of Appeals on February 2, contesting the agency decision on December 4.

I recently posted a recap of the situation with LTD Broadband in Minnesota shared by the MN Public Utilities Commission. Very briefly, LTD Broadband was awarded the chance to bid of building broadband in Minnesota. Then the funding was denied. A byproduct of that series of events is that the MN PUC is now looking at revoking LTD’s ETC designation. In a recent meeting with the PUC, LTD Broadband referred to the “unlikely event that the FCC does ultimately approve the long form [application for funds]…

It will be interesting to see how the petition regarding the FCC will go.

Recap/reminder of MN PUC decisions on LTD Broadband ETC status for Feb 16 call

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I assume this has been shared to prepare folks for the Feb 16 Prehearing conference in MN PUC petition to revoke LTD Broadband’s ETC Designation. It’s a recap from the meeting on November 16, 2023…

The Commission met on Thursday, November 16, 2023, with Acting Chair Means and Commissioners Sieben, Schuerger, Sullivan, and Tuma present.

The following matters were taken up by the Commission:

P-558,P-6995/M-22-221

In the Matter of a Petition to Initiate a Proceeding to Revoke the Expanded Eligible Telecommunications Carrier Designation of LTD Broadband, LLC and Deny LTD’s Funding Certification for 2023 P-6995/M-21-133 In the Matter of the Petition of LTD Broadband LLC to Expand Its Designation as an Eligible Telecommunications Carrier

Commissioner Tuma moved that the Commission:

  1. Lift the stay imposed pursuant to the Administrative Law Judge’s January 18, 2023, Third Prehearing Order.
  2. Refer the matter back to the Office of Administrative Hearings with the request that the matter be restarted following the procedure outlined in the Commission’s August 16, 2022, Notice and Order for Hearing.
  3. Grant the Petitioner’s motion to suspend LTD’s RDOF ETC designation previously granted by the Commission.

The motion passed 5–0

EVENT Feb 16: Prehearing conference in PUC petition to revoke LTD Broadband’s ETC Designation

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The Department of Commerce just posted an announcement of a Prehearing conference in PUC petition to revoke LTD Broadband’s ETC Designation…

In the Matter of a Petition to Initiate a Proceeding to Revoke the Expanded Eligible Telecommunications Carrier Designation of LTD Broadband LLC and Deny LTD’s Funding Certification for 2023 In the Matter of the Petition of LTD Broadband LLC to Expand Its Designation as an Eligible Telecommunications Carrier ORDER FOR PREHEARING CONFERENCE

To: All Persons on the Attached Service List

This matter is pending before Administrative Law Judge Jessica A. Palmer-Denig pursuant to the Order Lifting Stay, Referring to Office of Administrative Hearings, and Suspending Expanded Eligible Telecommunications Carrier Designation, issued by the Minnesota Public Utilities Commission on December 27, 2023.

Based upon the files, record, and proceedings herein,

IT IS HEREBY ORDERED:

  1. A prehearing conference will be held by videoconference via Microsoft Teams on Friday, February 16, 2024, at 2:00 p.m. The prehearing conference may be accessed as follows:

Access Link: http://tinyurl.com/LTD-Broadband-PHC Passcode (if needed): BARXhq

  1. If a party experiences technical difficulties and needs to join by telephone, the prehearing conference may also be accessed by calling: (651) 395-7448, and entering conference code number: 920 894 661#.

MN PUC Action and Orders in petition to consider revoking LTD Broadband ETC designation

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The MN Public Utilities Commission just posted the Commission’s action and order subsequent to their meeting on November 16, 2022 pm the Petition to initiate a proceeding to revoke the expanded eligible telecommunications carrier designation of LTD Broadband LLC and deny LTD’s funding certification for 2023. I wrote about the meeting on that date so the following isn’t news, but it is official. The 7-page document gives a concise history of the petition. I’ll just include the Commission action and order…

Commission Action

Under the regulatory framework for the federal Universal Service Fund, the Commission has the distinct and essential responsibility to designate ETCs within Minnesota when doing so is in the public interest. Multiple commenters have stated that LTD’s expanded ETC designation is harming the public interest by complicating and impeding efforts to obtain other federal and state funding for broadband deployment in the affected communities.

The Commission agrees with the Petitioners and other commenters that suspending LTD’s expanded ETC designation for the duration of this proceeding will serve the public interest by clearing up some of the regulatory uncertainty surrounding LTD’s RDOF award. Regardless how the FCC rules on LTD’s application for review, communities in LTD’s expanded ETC area are currently facing obstacles to seeking other broadband funding because LTD’s federal proceeding remains undecided for an indeterminate length of time. This regulatory uncertainty, combined with the seriousness of the claims against LTD and the importance of developing broadband networks in these communities, weighs in favor of suspending LTD’s expanded ETC designation during the pendency of this proceeding. The Commission will therefore grant the Petitioner’s motion to suspend LTD’s RDOF ETC designation previously granted by the Commission.

ORDER

  1. The Commission lifts the stay imposed pursuant to the Administrative Law Judge’s January 18, 2023, Third Prehearing Order.

  2. The Commission refers the matter back to the Office of Administrative Hearings with the request that the matter be restarted following the procedure outlined in the Commission’s August 16, 2022, Notice and Order for Hearing.

  3. The Commission grants the Petitioner’s motion to suspend LTD’s RDOF ETC designation previously granted by the Commission.

  4. This order shall become effective immediately.

FCC says Starlink is ineligible for $900M in RDOF subsidies

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Punjab News reports…

The Federal Communications Commission (FCC) in the US has announced not to award Elon Musk’s Starlink nearly $900 million subsidy for expanding broadband service in rural areas, based on its failure to meet the basic programme requirements.

The ‘Universal Service Fund’ programme, which uses funding collected from consumers, sought to expand access to broadband networks in rural areas.

“The FCC followed a careful legal, technical and policy review to determine that this applicant (Starlink) had failed to meet its burden to be entitled to nearly $900 million in universal service funds for almost a decade, ” said FCC Chairwoman Jessica Rosenworcel.

The agency qualified Starlink at the short-form stage, but at the long-form stage, the Commission determined that Starlink failed to demonstrate that it could deliver the promised service.

“Funding these vast proposed networks would not be the best use of limited Universal Service Fund dollars to bring broadband to unserved areas across the US, ” the Commission noted.

And more details from Broadband Communities…

The FCC has reaffirmed a prior decision to reject Starlink’s application to receive public support through the Rural Digital Opportunity Fund program.

The decision was announced by the FCC in the form of a statement, released Dec. 12, which accompanied the release of an Order on Review that resulted in a decision to uphold the denial of Starlink’s application.

FCC Chairwoman Jessica Rosenworcel’s statements were included in the FCC’s recent announcement. She said the FCC “followed a careful legal, technical and policy review to determine that this applicant had failed to meet its burden to be entitled to nearly $900 million in universal service funds for almost a decade.”

The original decision to deny Starlink’s application was made by the Wireline Bureau in August 2022. At the time, Rosenworcel said Starlink’s technology “has real promise,” but she raised concerns as well.

“The question before us was whether to publicly subsidize (Starlink’s) still developing technology for consumer broadband—which requires that users purchase a $600 dish—with nearly $900 million in universal service funds until 2032,” she previously said in August 2022, according to an FCC announcement about Starlink’s original denial.

FCC denies LTD Broadband’s funding appeal and issues fines. Owner starts/rebrands GigFire?

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The Minneapolis Star Tribune reports on LTD Broadband…

The Federal Communications Commission has upheld a decision to block LTD Broadband from using any part of $1.3 billion in federal grants to subsidize the construction of high-speed internet infrastructure, including a major proposed buildout in Minnesota.

The FCC this week denied an appeal from LTD and proposed a nearly $22 million penalty for the embattled telecom company. The agency and many critics in Minnesota say the company is unlikely to deliver on its promises to serve rural areas lacking adequate broadband after winning a grant contest in 2020.

Corey Hauer, CEO of Nevada-based LTD, told the Star Tribune the company is “disappointed in the two FCC decisions and are evaluating our options, including taking the FCC to court.”

They added…

Separately, the FCC also said Hauer created a similar company named GigFire potentially to evade liability for LTD’s actions. The agency hasn’t imposed the penalty yet, but can do so after LTD has a chance to respond.

In March 2023, LTD Broadband announced a name change to GigiFi. I remember the announced predated a new website. (It looks like there is a gigifi based in Puerto Rico.) Now the LTD Broadband website mentions and redirects the visitor to GigFire. It’s unclear to me whether this is a rebranding or a new venture. Both GigFire and LTD Broadband currently show up as vendors on the FCC National Broadband Map. That seems problematic, especially when they seem to cover the same area.

The map below from the FCC National Map shows where GigFire serves FTTH (in pink) and unlicensed fixed wireless (in purple):

And here is the same map for LTD Broadband…

The FCC denies LTD Broadband’s application for review of RDOF awards

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LTD Broadband was awarded the opportunity to apply for a lot of federal money (RDOF) to bring broadband to specific states, including Minnesota. They were the largest winning bidder. LTD needed to submit long-form applications to receive the awards. The review of the long form applications was not as success of the original application. LTD Broadband trying to appeal to the negative results and the FCC has just answered by saying they deny the application for review. The full reply is detailed and interesting. I have tried below to pull out the points most pertinent to LTD Broadband…

By this Order on Review, we deny an application for review submitted by LTD Broadband, LLC (LTD).1 LTD seeks review of a decision by the Wireline Competition Bureau (WCB or Bureau) that denied its application to be authorized to receive broadband deployment support from the Rural Digital Opportunity Fund (RDOF) Auction 904.

…

LTD timely submitted a short-form application and was announced as one of 386 bidders approved to participate in Auction 904.22 Auction 904 commenced on October 29, 2020. In the first round of the auction, LTD bid to deploy gigabit service to 2,223,682 locations in 16 states, seeking $13,326,751,930 in 10-year support despite an existing small deployment footprint and subscriber base of approximately 15,000 customers. At the conclusion of the auction after 19 rounds of bidding, LTD was

the largest winning bidder in the auction, with winning bids to deploy gigabit speed low-latency service to 528,088 locations in 15 states with $1,320,920,719 in 10-year support.

…

LTD filed its timely long-form application for support on January 29, 2021, and submitted, among other items, an attachment with its detailed technology and system design description as required of all applicants by February 15, 2021. On February 18, 2021, staff announced that there were 417 long-form applicants.26

…

Auction 904 long-form applicants were required to certify that they are eligible telecommunications carriers (ETCs) in all bid areas and to submit appropriate documentation supporting such certification on or before June 7, 2021.27 LTD timely sought and received ETC designation in eight states (Colorado, Illinois, Indiana, Minnesota, Missouri, Ohio, Texas, and Wisconsin). In the remaining seven states in which it had winning bids (California, Iowa, Kansas, Oklahoma, Nebraska, North Dakota,

South Dakota), LTD filed a request for waiver of the June 7, 2021 deadline to submit ETC certifications to the FCC.28 In two separate orders, the Bureau denied LTD’s request for waiver of the ETC certification deadline for California, Kansas, Oklahoma, Iowa, Nebraska, and North Dakota.29 LTD subsequently defaulted on all winning bids in Kansas and Oklahoma and sought reconsideration of the waiver denials regarding California, Iowa, Nebraska, and North Dakota.30 Later, LTD withdrew its petition for reconsideration of the waiver denials in California and Iowa, thus defaulting on all bids in those two states.31

…

In March 2021, June 2021, September 2021, and multiple times in March 2022, staff spoke with LTD about the financial and technical deficiencies that staff identified in LTD’s long form application. In these calls, staff explained the insufficiencies to LTD and answered LTD’s questions regarding program requirements. LTD did not submit revised financial information after its initial filings at the long-form application deadline. On August 5, 2021, LTD submitted a revised technical description

purporting to cover Arkansas, Louisiana, and Mississippi (states in which it did not place winning bids). Even if assumed to apply to the fifteen states in which LTD did place winning bids, the revised documents did not sufficiently address the application technical deficiencies. After the September 2021 staff call, LTD submitted another revised technical description in November 2021, but that revised version still indicated that it applied to Arkansas, Louisiana, and Mississippi, and it was still insufficient to show that LTD could meet the obligations associated with its winning bids. Repeated contacts with LTD through March 2022 did not elicit additional financial or technical filings. To conclude this process, staff sent a formal letter to LTD on May 26, 2022, extensively detailing the application’s deficiencies and providing LTD a final opportunity to demonstrate its qualifications for support. LTD’s response was due by June 27, 2022.

In response to that letter, on June 27, 2022, LTD submitted revised financial and technical attachments to explain its network deployment plans in 10 states (Colorado, Illinois, Indiana, Minnesota, Missouri, North Dakota, Ohio, South Dakota, Texas, and Wisconsin). Furthermore, LTD identified that it had entered into two financial agreements on that same day to obtain additional funding and a source for future loaned funds, ostensibly to enhance its financial position and operational

capabilities. Subsequently, staff sought clarification from LTD as to why a technical or financial plan for Nebraska was not included in these revised materials. LTD responded that it was still seeking RDOF support in Nebraska despite not including this state in its final financial and technical submissions.32 In sum, LTD proposed to deploy fiber to 475,616 estimated locations in 11 states.33

The Bureau concluded its review of LTD’s long-form application in each remaining state in which LTD had placed winning bids to determine whether it met all legal, financial, and technical requirements. The Bureau determined that LTD was not reasonably capable of complying with the Commission’s public interest requirements established for the RDOF program for a number of both financial and technical reasons. It therefore denied LTD’s application and announced LTD in default in

all of its remaining winning bids.34 The Bureau also dismissed LTD’s remaining Petition for Reconsideration regarding its ETC Designation Waiver Requests as to Nebraska and North Dakota.35 Having inadvertently failed to dismiss LTD’s ETC Designation Waiver Request in South Dakota when it denied LTD’s long-form application, the Bureau subsequently dismissed that waiver request in a Public Notice.36

Folks in Minnesota have been watching the situation with LTD Broadband with the FCC and the Minnesota PUC, where they have been having similar issues. The MN PUC suspended LTD’s ETC designation in November and asked the Office of Administration to look further into it.