PEDRO R. PIERLUISI
P UERTO RICO
J UDIC IA R Y
1213 LoNGWORTH HousE O FFICE BuiLOING
cteongress of tbe mlniteb ~tates
N ATURAL RESOURCES
FAx: (202) 225-2154
SAN JUAN OFFICE:
~ou~e of l\epre~entatibe~
157 AVENIDA DE LA CONSTITUCION
ANTIGUO EDIFICIO DE MEDICINA TROPICAL
asbtngton. ]JB(IC 20515-5401
ALA DE E NFERMERIA 200 PISO
SAN JuAN, P uERTO R1co 00901
FAJt: (787) 729-7738
March 26, 2014
Hon. Thomas Wheeler
Federal Communications Commission
445 121h Street, SW
Washington, DC 20554
Re: Connect America Fund Phase I and Phase II Funding in
WC Dockets J0,-90 and 05-337, FCC DA 13-2304 (rei. Dec. 2, 2013)
Dear Mr. Chairman:
I write in my capacity as Puerto Rico's representative in the U.S. Congress.
know, Puerto Rico continues to lag far behind the rest of the United States in both
broadband and telephone subscribership and deployment. The Federal Communications
Commission's broadband progress reports consistently observe that, of all U.S. states and
territories, Puerto Rico has the largest number of residents that are unserved by fixed
In its 81h Broadband Progress Report, the FCC noted that more than half of
Puerto Rico's residents-54 percent of the population or 1.9 million people-lack access
to fixed broadband at speeds widely available throughout the rest of the United States.
This is nine times the national average of 6 percent.
This glaring disparity must be
addressed. Closing this gap is critical to Puerto Rico's economic future and the ability of
its residents to access the many educational, social, political and health-related benefits of
broadband that the rest of the United States enjoys.
I understand that the FCC is currently considering how to distribute $9 billion in
broadband support over a five-year period as part of Phase II of the Connect America
In its 2011 USF Transformation Order, the FCC spoke directly about
Puerto Rico when it recognized the unique challenges of serving the non-contiguous
The FCC specifically directed its Wireline Competition Bureau to "reflect the
unique circumstances and operating conditions in the non-contiguous areas of the United
States" in any model it adopts to distribute CAF Phase II funding.
The FCC further
stated that, if the Wireline Bureau is unable to follow this directive for whatever reason,
the Bureau must maintain existing universal service support for the price cap carriers in
such non-contiguous or insular areas_
At present, price cap carriers in Puerto Rico receive $36 million annually in existing
universal service support.
However, the current distribution model proposed by the
Bureau would award Puerto Rico only $7 million annually.
The FCC is increasing the
PRINTED ON RECYCLED PAPER
total money available by 67 percent, yet also proposing to decrease the amount made
available to Puerto Rico by 77 percent.
This result makes no sense, given that the FCC
has consistently found Puerto Rico to be the U.S. jmisdiction with the weakest level of
fixed broadband deployment.
Put simply, the proposed model does not adequately
account for the unique operating conditions in Puerto Rico, including its low per capita
income, the very low "take rate" for fixed broadband where the service is available (30
percent compared to 80 percent in the model), and the relatively high cost of goods and
certain services in the territory due to its geographical location.
As per the FCC's
directive, the Bureau must maintain the level of universal service funding Puerto Rico
Adequate broadband infrastructure is essential to educate children, attract and grow
businesses, and build a robust economy.
The CAF Phase II funding provides an
important opportunity to substantially improve the state of broadband deployment in
Oversight by the FCC is needed to ensure that the CAF support is
distributed to those communities, like Puerto Rico, where it is needed most and will have
the greatest impact.
-~ô R. Pierluisi
Member of Congress
Hon. Mignon Clyburn, Commissioner
Hon. Michael O'Rielly, Commissioner
Hon. Ajit Pai, Commissioner
Hon. Jessica Rosenworcel, Commissioner
Note: We are currently transitioning our documents into web compatible formats for easier reading. We have done our best to supply this content to you in a presentable form, but there may be some formatting issues while we improve the technology. The original version of the document is available as a PDF, , or as plain text.