One of Two CAF-II Applicants Get Letter of Credit Relief


The Federal Communications Commission’s Wireline Competition Bureau (Bureau) has granted one of two waiver requests relating to the letter of credit (LOC) requirement for Connect America Fund (CAF) Phase II support won at Auction 903.  The waiver request of Casey Mutual Telephone Company (Casey Mustual) was granted, allowing it to submit a late-filed LOC commitment letter after it mistakenly believed that it was not required to obtain a LOC.  Because Casey Mutual was able to obtain and submit its commitment letter during the long-form application processing period, the Bureau found that the oversight did not delay the FCC’s application review process or the provision of voice and broadband services in supported areas.  Accordingly, the Bureau found the waiver grant to be in the public interest.  Conversely, the Bureau denied the waiver request of Allen’s T.V. Cable Service, dba Allens Communications (Allens), which did not understand that the LOC was required to cover cumulative disbursed support and believed instead that the LOC only covered the support amount to be disbursed in the upcoming year.  Allens also argued that obtaining an LOC in the correct amount was challenging due to its operations in hurricane-prone areas.  The Bureau found that waiving the amount requirement would not serve the public interest as the importance of upholding the FCC’s responsibility as the steward of public funds outweighed the risk of Allens not being able to pursue its CAF-II buildout.  The Bureau also notes that Allens still has an opportunity to provide a correct LOC if/when the Bureau grants Allens’ long-form application; otherwise, Allens may default and be subject to forfeiture.

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