A lot of people are trying to wrap up projects before the end of the year. In Washington, D.C., they’re trying to wrap up some Really Big Projects, like the federal budget.
“Frenzy might be an understatement,” said Tim Donovan, SVP of Legislative Affairs and incoming president and CEO at the Competitive Carriers Association (CCA). “There’s a lot going on.”
Donovan and his team are in the thick of discussions happening this week and next in Washington. CCA is trying to get Congress to fully fund the changes its operator members need to make in order to comply with federal mandates.
CCA and other organizations called on lawmakers in a December 8 letter to fully fund the FCC’s Secure and Trusted Communications Networks Reimbursement Program, otherwise known as “Rip & Replace.” The program was mandated by the government in 2019 to remove from U.S. networks Chinese equipment deemed to pose a national security risk and replace it with equipment from trusted vendors.
“Failure to fund the program will mean that carriers cannot complete the job of removing and replacing vital equipment in their networks, and the result will be partial or complete shutdowns of service in many areas where no other carrier provides service,” the letter states. “This will affect not only the rural carriers’ direct subscribers, but also the only connectivity available to millions of other consumers when traveling through their networks’ signals, including the ability to make emergency and 911 calls.”
Other signatories to the letter are the Information Technology Industry Council (ITI), NATE: The Communications Infrastructure Contractors Association, NTCA – The Rural Broadband Association, Rural Wireless Association, Telecommunications Industry Association, Wireless Infrastructure Association and WTA – Advocates for Rural Broadband.
Stuck between a rock and a hard place
In July, the FCC identified a $3.08 billion funding shortfall to fully fund the program’s approved application cost estimates. Without full funding, carriers could only be reimbursed for about 40% of their costs, Donovan explained. Therefore, a lot of affected carriers are left high and dry until they get an answer about this funding.
In some cases, operators are moving ahead with network upgrades in good faith that the funding will come. Others are frozen because they’re unsure what they can do with limited funds – and they don’t want to start swapping out equipment without knowing they can complete the transition. They need to keep their services up and running if the funding shortfall continues.
Simply put: “Not a comfortable place for the operators at all,” he said.
Complicating everything for many operators, especially in western states, is the inability to access towers during winter months. They need to get to their towers to make modifications to the equipment.
From a practical standpoint, “carriers want the gear out of their networks yesterday,” he said, but they’ve essentially been immobilized the past several years.
Donovan explained that as the big operators are shutting down 3G – Verizon’s 3G is the last to sunset and it’s due to go dark on December 31 – the networks of the smaller carriers are showing their age. They haven’t been able to do the upgrades they need. That’s a problem when customers of the bigger carriers can’t roam in these more rural areas – and they’re unable to make calls to 911.
In Washington, D.C., two paths of discussion have been underway, he said. One is through the appropriations process, where there are a lot of competing priorities. Another is through the spectrum auction authority extension, where they’re talking about using auction proceeds to pay for the shortfall in the Rip & Replace program.
End-of-the-year budget crises are nothing new in Washington, D.C.; deadlines tend to drive everyone to find resolutions. A lot of times, there are important things that are nice to have, but in the case of Rip & Replace, it’s about a nationally identified security threat that must be addressed, he said.
When the initial $1.9 billion was allocated for Rip & Replace, it was based on best estimates at the time for what it would cost, and it didn’t take into account things like inflation or increased costs of goods due to higher diesel prices, for example, he said. There are legitimate reasons it’s coming up short, but the impetus now is to get the funds before the 117th Congress adjourns.