CPUC kicks RDOF kicker decision into January and out of the hunt

13 November 2020 by Steve Blum
, , , ,


Hope is dead that bidders for federal broadband money in the ongoing Rural Digital Opportunity Fund (RDOF) auction would have certainty or, perhaps, even a clue regarding the California Public Utilities Commission’s supplemental subsidy plan before the auction ends. That means that the incentive value of California’s money is zero for most, if not all, Internet service providers in the reverse auction that’ll determine which communities and states divvy up $16 billion earmarked by the Federal Communications Commission for rural broadband service upgrades.

Joanna Gubman, the CPUC administrative law judge managing the lengthy – and unnecessary – bureaucratic process leading up to a decision, sent out an email yesterday saying there would be month delay in publishing a draft decision laying out how California’s RDOF “kicker” will be offered, if it’s offered at all…

The Scoping Memo in this proceeding stated that the Phase I-A Proposed Decision would be issued by November 13, 2020, subject to modification by the Administrative Law Judge if required to promote the efficient and fair resolution of the Rulemaking. Accordingly, the Phase I-A Proposed Decision will now be issued by December 11, 2020. The schedules for future phases of this proceeding remain unchanged.

A preliminary plan, a list of eligible census block groups – areas in California where the digital divide is widest – and nominal “kicker” amounts are posted. But before Internet service providers can take that to the bank, a formal proposed decision has to be published, and at least 30 days has to elapse before CPUC commissioners vote on it.

Until and unless they approve it, nothing is certain. The $16 billion is being distributed via a reverse auction that began on 29 October 2020 and has gone through nine rounds so far. Round 10 is today. The idea was that if the CPUC offered bidders a bonus from the California Advanced Services Fund (CASF), then they would add it to their own project budgets and bid more aggressively for the targeted census block groups.

But to do that despite the FCC’s stringent default penalties, ISPs will have to take the preliminary plan and the conditions that go with it, such as offering open access to subsidised infrastructure, on faith.

Some bidders might risk it. Most, though, will conclude that faith is a bad basis for capital investment.