I think we will go ahead and start. My Ranking Member senator coons will be here shortly. I will go ahead and make my Opening Statement and maybe we can begin the testimony. Thank you all for being here this afternoon. I appreciate it. Mr. Pai, just personal like to thank you for your comments last week about the tone of civility we need to strike. I think you will find that in this subcommittee so thank you for that. Today marks the first hearing of the Financial Service and general Government Subcommittee for the 115 congress. This is also my first hearing in my new role as the chair pm woman of this subcommittee. I am honored to be serving with senator coons. As we begin the budget request we welcome our witnesses. Fcc chairman ajit pai and commissioners Mignon Clyburn and michael orielly. We look forward to hearing from you all about the fccs budget request and the work you are doing to carry out the agencys mission. The commission has requested a total of 322 million. The fcc funding is offset by the fees that does not minimize our duty to ensure the agency is operating effectively and the funds are being spent responsible this is important because the fees are passed on to the American Consumer and impact the Economic Growth and potential. That impact is especially critical in Rural America. Communities in my state of West Virginia have been hit hard by job loss and two visitors have seen this first hand. Broadband access can provide West Virginians with opportunities to new jobs and higher wages. Potential investors need to see West Virginia is open for work. According to the fcc, more than 30 million americans lack access to highspeed Broadband Internet including a disproportionate number of rural communities. These communities struggle to compete in todays interenet base world. In 2015 i launched by plan jump starting a statewide conversation about the need to connect our state. Broadband should be easily available and affordable. It is that simple and at the federal level we have been trying to make this a reality. The benefits of Broadband Access are numerous but too many parts cannot attract the investment they need to get online despite significant federal and private funding West Virginia is less connectedly than oh other state. We have lack of competition between providers, burden some regulations and failed to mackmize existing resources. Communities like the white water resorts in faithful county need robust internet. These communities can capitalize on Natural Beauty and attract a workforce base that needs a community and strong activity. We must a equip them with the right tools. The giga bit opportunity, or go act, incolonels new investment to connect rural and urban communities by empowering governors and states to direct investments to areawise the greatest needs this proposal ensures communities with the highest potential for Economic Development a prioritized for funding. The proposal eliminating bearr r barriers to new investment. The fcc is directed to release a framework to streamline broadband laws throughout the state. We have talked about this with the commissioners. This will eliminate the duplicated laws that occur in all states. Once adopt, the governor would be able to section off a portion of the areas as go investment zones and areas would benefit from targeted taxes and other incentives. Internet access should be available regardless of whether you live in a small town or big city and it is essential to growing the nations economy and in particular West Virginias economy. With all the focus on Rural America now is the time to level the Playing Field and close that Digital Divide. I will let senator coons have his Opening Statement and turn to the witnesses and chairman pai i will ask you to begin with your testimony. Chairman, thank you for holding this hearing. Thank you for inviting us here today to prevent the fcc fiscal year 2018 budget request. And commissioners Mignon Clyburn and mike orielly. It is a privilege to work alongside each of them. For fy18 we have developed a carefully crafted budget with request of approximately 322 million, 5. 2 below the previous year. We will not need redirected moves or stacking funds. In addition, we propose to reduce our spectrum option cap from 117 million to approximately 111 million enableling us to transfer 6 million more to the treasury. We can all agree that budget reductions dont come easily. We will face the same challenges as other agencies doing more with less. Impleme implementing budget cuts means rolling up our sleeves and rethinking how the Commission Functions and does business. In the past, the fcc chairman emphasized we are an entirely fee funded agency. But it is important to remember someone is paying our freight and that is Small Businesses individual licenses and Larger Companies which pass along those fee do is American Consumers. It is imperative for the fcc to be fiscally responsible and avoid unnecessary spending. I firmly believe if we refrain from Regulatory Overreach we will realize additional cost savings and Economic Growth. Results that benefit everyone. While we have experienced staffing reductions over the years, administrative efficiency have ensured the range is productive. With 100 fewer staff than last year we have pursueed an aggressive schedule for open meetings where commissioners consider the highest profile matters. In 2017, we are averaging more than double the amount of items per meeting than we considered last year and i expect this to continue into fy18. Since becoming chairman in january, we have been aggressive in looking for cost savings and our staff identified substantial reductions lying closing offsight warehouse and improving our Mail Services for a projected saving of 851,000. We will save another 280,000 by reducing the number of on sight printers and copy machines. As we move into fiscal year 2018 we will focus on advancing the four strategic goals. We will concentrate on closing the Digital Divide. We will implement the connect America Fund Phase two and the Mobility Fund reverse auctions to bring fixed broadband and 4glte to Rural America. Our task force has a solid plan were getting the job done. If i may say madam chair pm woman, i appreciate your initiative in introducing the go act. I thank you for your leadership in that regard. Second we will work to promote innovation from implementing policies to ensuring leadership to authorizing Television Broadcasters to use the next Generation Television standard. We will move full speed ahead to get more airwaves into the commercial marketplace. We will focus on protecting consumers and Public Safety from combating illegal robot calls and improving calls for deaf and hard of hearing americans. When it comes to Public Safety we will continue to support those on the front lines across the country who protect all of us each and every day. And fourth and finally we will focus on reforming the fccs processes. The American People deserve to have a transparent and responsive regulator. We have made progress on this part like making Public Commission items at least three weeks before we vote on them but there is much more to do and do it we will. I am excited about how the fcc can bring Digital Opportunity to more americans, protect the American People and improve our agencies operations. I believe this budget requests helps advance these goals in a fiscally responsible way. Now, i would like to turn to commissioner cylburn and ask for her to present her testimony. Thank you. Ranking member coons, and members of the subcommittee, good afternoon. It is my distinct mreergs pleasure to appear before you and offer my perspective on the fcc fy18 request. Yesterday marked the fccs 83rd anniversary and while much as changed since 1934 our responsible when it comes to protecting consumers, advancing competition and ensuring the reliability of Public Safety Communications Remains unchanged. To achieve these goals the fcc needs a fully staffed workforce. However the agency finds itself with fewer fte than in years. It is creating deficiency and in others it is requiring employees to double up on responsibilities with little if not any pay increase. This thought only puts at risk the quality of the final work outcome but has a direct impact on worklife balance. Each year the federal Employee Viewpoint survia asks fcc employees whether they agree or disagree they have sufficient resources to get their job done. In 2011, just over 30 of fcc employees disagreed with this statement. By 2016, that figure had rise next to nearly 38 and additi additional cuts and budget cuts will likely lead to an increase in the coming years. Likely more, an increasing number of employees are eligible for requirement. Today, 362 fcc employees are retirement eligible equally 23 of our workforce. 124 employees already departed the agency this year and this figure is only expected to increase. Some retire while others leaves for new job opportunities. While we have no choice but to think about a future which recruits and retains the nations next generations best and brightest we must do so and do so we will. You may have also heard me speak about the need for better broadband data in part because i have heard from far too many communities that take issue with the fccs figures. They said that where our data shows there is fixed or mobile broadband cover in actuality the service ranges from spotty to non existent. It should not be this difficult for the Expert Agency to have accurate data down to the street level for we know that improved data enables us to better target our infrastructure efforts and improve the accuracy of our National Broadband map. I am a strong believer in the power of broadband to tackle some of our nations greatest challenges particularly when it comes it health care. Thanks to the connected Health Task Force we have a clearer picture of where the greatest needs exist. Chairman pai is committed to carrying on the work of the task force and i am hopeful through a sustained investment in this initiative it will continue to inform us in rural communities. As the subcommittee prepares the appropriation bill for fy18 i am hopeful it infrastructure will be top of mine. Modern it infrastructure should be able to handle a few 100,000 Public Comments without grinding to a halt. And to demonstrate the agencys commitment to it modernization in cybersecurity future budget requests should include a dedicated subaccount supporting these critical needs. Finally, i would like to talk about the agencys spectrum auction program. Despite several auctions in development and more in the pipeline the commissions budget requests cuts 5. 8 million from the program. Our options produce a tremendous return on investment and are a winwin for consumers, industry and the federal government. With 5g on the horizon, we need to look long term and focus on how we will provide funding necessary to administrator auctions in a timely manner. A sustained investment will help unlock the next generation of wireless broadband and ensure america is a leader in wireless innovation. Returning to the Central Commission mission it is great disappointment to me that this fcc is on the track to dismantle many of the key rules involving Consumer Protection and competition. Is this a prelude to the commission that ultimately allows large countries to exist in a regulatory free zone . I ask this because the American People count on the fcc to be the referee on the field ensuring providers play by the rules and consumervise chance to be on the winning team but only if the agency plays the right plays will it be able to say they are truly putting consumers first. Thank you for inviting me. I look forward to any questions. Now i would like to turn it over to commission orielly. Welcome. Chairman capito, Ranking Member members of the Ranking Member and memberofs of come committee thank you for allowing be to be here. Changes can be made without under lying. Support for further work on the commissions universal service fund within the wireless competition bureau. On another note, relocating the headquarters is final i think it is necessary to comment the move will have a negative impact on the agency. I know of several seasoned agencies professionals who will chose to leave the Commission Rather than transfer to the new location. In terms of the commission structure, i would argue we maintain out dated burrows and divisions based on by gone eras. They are based on transmission mechanisms that predate the internet and the radical conversion that has occurred since then. I would suggest this subcommittee consider requesting transformative plans for the structure. This commission is focused on the fy18 budget but it seems appropriate to raise quality issues. First, as mentioned is the Top Commission priority to make broadband available to as Many Americans as possible. In addition, the commission completed reform on the rate of return regulation and this bipartisan effort supported then and still by the affected industry allocates just over two billion for rate of return carriers so they can bring service to consumers. Additionally, i would be remiss if are didnt mention my find the app in remote areas fund. Second, reviewing to prepare to move the broadband deployment m imposed by state and local government including excessive fees are being replicated and cannot be allowed to continue if we are to ever make Broadband Availability as abiquitious as possible. And not collecting fees for 911 purposes and the commission to identify in 2016 eight states and a u. S. Territory continue that practice. I have previously outlined a few possibilities for the commissions to push the states to stop this behavior this committee maintains the ability to commission billion ins grants and funding providing the fees which could be a great course corrector on this subject. Lastly, the commission has allowed individuals to illegally setup shop in radio bands causing harm to legitimate broadcasters and the american public. Thankf thankfully the commission is preparing a different track toward the illegal operators and it is welcome as we set forth to end this practice. Thank you for the opportunity to be before and look forward to any questions you have. I want to turn to senator coons for the Opening Statement. Welcome. Our first meeting together. Thank you for being grace gracious and allowing me to make an opening later in the hero. I want to thank you the entire committee for being present. I look forward to working on a number of the challenging if yous we have. Welcome chairman pai, well known to all of us and commissioner cylburn and commissioner orielly. I welcome the opportunity to examine the budget request and discuss your crucial role in ensuring communication is reliable, efficient and continuously innovative. The proposal is 5 below the current operating level. The fcc funding has been frozen since 09 forcing funding in a variety of ways. These have been found through productive means in some cases but i am concerned there are no more easy proficiencies improvements to be found and it may affect the heart of the mission to lose more. To achieve the proposed productions, the staff cuts will result in the lowest Staffing Levels on record for the agency. I look forward to hearing from the witnesses about how this means of achieving this production will be accomplished without impacting the core mission of the agency. I think there is positive news in that we share an excitement for improving Broadband Access the 10 billion universal fund expands access to vital communication necessary in our modern age. I was pleased to hear from chairman pai about progress on the Mobility Funding the connect america fund which provides significant funding for lte and broadband service. I look forward to working with chairwoman capito about that as well. I express Consumer Privacy protection on data and we work to resure the public on the common ground. Chairman pai has made significant progress on project and it is my hope we can Work Together to find ways to protect consumers and to address the fundamental issues around Net Neutrality that are a concern to a lot of my constituents and country as whole. Thank you for sharing your perspective about the fcc funding requirement goals and thank you chairwoman for your leadership. I noticed the Ranking Member of the full committee entered the room and i would like to extend the opportunity to say a few words. Thank you my friend from West Virginia and my friend from delaware. I did want to come in to raise a question on Net Neutrality. I look at the Trump Budget Proposal that cuts funding for the fccs core budget by 5 . This may pail in comparison with there drastic cuts proposed for our other agencies but it is significant for an agency whose budget basically flat funded for years. Perhaps it is a reflection of an agency and the administration walking away from some of its core responsibilities. And no area do we see that more than Net Neutrality and broadband privacy protections. This is something i hear every single time i go home. I hear it in the airport, going to the grocery store, church on sunday. I hear it everywhere. In fact, nearly four million americans, 4 million, an unprecedented number call the fcc to preserve the internet as a free and open platform for all. I had a hearing in vermont and Small Businesses and Large Businesses say the same thing. They want strong meaningful rules to protect consumers, Small Businesses and smart ups. They want rules to protect the internet as appear open forum for commerce ideas and expressions. Small businesses told me about why these rules are so important. They dont want special treatment. They simply want to assure the internet remains an equal Playing Field so they can use the internet to expand their businesses beyond the border without fear of prohibitive fees of being squeezed out. One very wise Company Started a Small Company and says they dont want special preference and to be in a position where Small Companies can get squeezed out by Big Companies that can afford it otherwise you will never see a Small Company start up again like them. The fccs open internet rules reflected the concerns of the Small Businesses and millions of americans. The role then could derail st t startups and businesses. The open internet rules ensure the internet remains an open dynamic platform, but chairman pai immediately after trump appointed you, the fcc became about face all of a sudden. You could hear the tires squeal and spun around. Chairman pai, your actions to gut the open internet rule appears to further the cause to ensure that corporations maximize profits at the expense of hard working americans and Small Businesses. Many of us have in our state. I am very troubled chairman pai under your leadership the fcc turned from an agency whose primary objective was to ensure competition in the marketplace to one that said it has been coopted by money, interest, and big businesses that could squeeze out competition. So i hope you would reconsider your illadvised decision on the open internet rules. I will close with this. In the past few months we have seen scroll and protections from the fcc and from congress control. I may be disappointed but sadly not surpriseded that the Republican Leadership and President Trump have teamed up to sign the corporate interest over consumers when they rolled back the broadband policy and protection. We have a lot of Small Businesses and startups that are going to be just killed by this. Hard working americans deserve better. Madam chair, i will place my full statement in the record. Thank you. We will proceed with our questions with each senator will do five minutes per round and i will begin the questions. My first question chairman pai is about something that was alluded to in your statement and commission oriellys statement about helping states figure out the best way to deploy broadband and eliminate some of the barriers. I know this is something you have been working on. Can you give me a quick status on where you are on that and where would like to say my state of West Virginia just passed a semi controversial broadband expansion bill which i am very proud the governor signed. Thank you for your question. We have taken aggressive steps to work cooperatively with states to put broadband deployment front and center at all levels of government. Soon after i was assigned as chairman i setup the Broadband Deployment Advisory Committee and one critical working group of which is devoted to states specifically helping to find a model code so states interested in broadband deployment can take an aapproved off the shelf guidelines. Additionally, we work with states to make sure every dollar spent is spent wisely on unserved areas. We have met with a number of state officials. Is there one state doing it really well . There are a number. For example, with tennessee i had a chance to learn how they migrated next generation 911 which is ipbased. I worked well with the governor of new york state to deliver connect American Funds to upstate new york and serve unserved americans. A lot of state. Every state i think shares the interest they just have different challenges and ways of getting there. Turning to the budget and comments commissioner cylburn and orielly made. I wanted to give you a chance to respond, or anybody, but first your thoughts since you didnt address it in the open statements on possible structure, 5 shrinkage in the budget. How do you see that to get the job done . We had guidance with the 5 figure and crafted the budget with that guideiananguidance. We wanted to make sure we met our responsibilities even if the staffing lower and despite the fact we have fewer staffers we have focused on doubling the output with meeting items. In the first month we got across the finish line in a bipartisan way and made sure fixed broadband and 4g broadband reaches americans. We made sure we use the assets we have in the most effective way. In the first speech i gave on this tom topic, i found our economists are sprinkled throughout the offices with some busy and some not. If the engineers have an office of engineering and technology. What if we centralize the economic function and consolidate all the talent we have in one office. It would allow us to attract economists to the agency and give an them academic environment to write white papers that generated the best ideas the fcc has. We are doing the best we can to meet the core responsibilities within the constraints that have been presented to us. Commissioner cylburn, you and i have talked about this in terms of coordination between the fcc, ntia and ruf. We have resources for broadband deployment. We have issues in our state with the initial stimulus package and deployment of those funds. What are you seeing in terms of coordination with the fcc here . Is this an area of strength or things that need to be worked on . I think both to be honest with you. We have a federalstate joint Board Initiative framework where we are constantly in contact with our state counterparts about how we can do and how we could build, you know, better relationships. The chairman was right to point out his program that was started gives the blueprint or a means for people to weigh in. I will also say however there is only one local representative as it stands now and what i am hoping that we will continue to do is work with local authorities, work with companies, work with us and come up with an infrastructure c consortium and get everybody at the table and come with a collaborative framework and really do what you and i want and that is the connect america. I think there are better ways we can do it but only through concerted effort and focus on goals and objectives and listening to state and local voices. Thank you. Senator coons . Commissioner pai, just opening concern. There is widespread concern the administration has been choosing not to respond to requests for information from democrats which counters a long standing tradition upheld by both parties as to how federal agencies ought to respond. Will you commit to responding to all questions, whether from the majority or minority, that come to you. Thank you for your question. Absolutely. I have done so during my tenure as chairman and will do so Going Forward. Consumer privacy is a concern to me. On april 3rd, President Trump signed into law an act that nullified the previous rules that provided movement on protection for Consumer Internet privacy. You believe it is the federal trade commission challenge but it is currently outside their jurisdiction so the fcc cant provide that protection currently. What privacy protections are currently in place and who is am forcing them . Do you think there should be privacy proection it protections . And how do we move toward robust privacy projections for consumers . Thank you for the question and appreciate your concern and the courtesy you extended to me yesterday in having this conversation. I think the baseline expectation of every consumer and regulatored and elected official i dare say the uniform expectation that Sensitive Information is protected whenever a consumer goes online. The federal trade commission was the cop on the beat applying the framework across the internet economy. After 2015, when the fcc deemed telecommunication carriers to be common cares we stripped the ftc of jurisdiction and that left a whole. The only thing that applies is section 222 of the communication act applying to telecommunication carriers and that is because the fcc rules on privacy have never gone into effect. Essentially in 2015 we had to figure out how to go forward and established guidance on our Enforcement Bureau and i think Going Forward what we want to make sure is we protect consumers as best as we can and work with the federal trade commission to make sure regardless of what agency is handling the issue we need to make sure the consumers are protected consistently. Do you think it is clear who is responsible or additional action needs to be taken . The fcc does have jurisdiction over Internet Provider and the federal fraid commission has jurisdiction over everyoneenti else. That is why we are committed to working with members of the federal trade commission to make sure we have a consistent framework protecting consumers whenever they go online. The other area i have concern about is Net Neutrality. When the fcc proposed the rule a record breaking number of americans filled comments. I think the crashed the fcc system and certainly crashed my phone system in my office and when it was announced again it happened again. That indicates there is a lot of americans with strong views about trying to keep the internet open. How will you consider the Public Comments you receive and how will the commission weigh the voices of millions of americans who have serious concerns about internet freedom. Important question. That is part of the reason why we are having the public conversation. It fcc could have said what the previous fcc did is null and void as a matter of law and moving ahead. But it is important to us to make sure we had the process that is prescribed by the Administration Procedure act. That is why we had a full 90 days of Public Comment in addition to the three weeks before the fccs vote to allow for that robust Public Comment. Once the Public Comment period closes in the middle of august, august 16th i believe we will take stock of the fccs terrific staff and try to figure out whether the fcc should move ahead and if so how. We will be guided of course by the principles of substantial evidence by the d. C. Circuit, by the facts in the record, and of course by the motivation to figure out what is in the Public Interest at the end of the day. I would be interested commission cylburn on either of those two issues and then i have one last issue i want to recognize. I find myself wondering who is the referee on the field when it comes to Broadband Access now. With the passage of the cra and i am not on attorney but i dont think anybody is directing or monitoring the balls and strikes. From that perfect, i am worried. I am worried as a customer and i am worried for the millions of others who are. Forgot the other question. Consumer privacy and Net Neutrality and how we provide reassurance for the public their concerns are going to be taken seriously. I am hopeful the four plus million comments we have heard is taken seriously by this body. People took the time to weigh in and their voices to be heard. We have a Government Agency responsible for doing the will of the people. I will close by complimenting the rule to reduce robo calls. As someone who is the victim of many of these calls i look forward to your work on that. It is a predatory practice and it is my hope we will address the unresolved concerns. Senator lankford. Thank you. Appreciate all of you being here. Tell me about life line and the process you are going through right now. I know there has been a continual review on life line and determining how to use it. There has been expansion over the several years. Still concerned about fraud and want to make sure taxpayer dollars are used correctly and wisely. Where are you on that right now . Our top priority at the fcc is closing the Digital Divide and the Life Line Program is an important part of the equation in terms of closing that divide. One thing we looked at is the way to make sure every single dollar, which is a taxpayer dollar, goes to somebody that needs the help. We want to make sure it is directed toward needy consumers and make sure any of the fraud in the system is investigated and rooted out. We are in the process of determining the next steps. You can rest assure so give me a time line on that. If i go back a year in the same hearing or year before that it seems to be the similar rhetoric i have heard. While there have been advances, what is or when is the next step on dealing with the fraud in life line . I think we have made it a priority and i have spoken with members of the staff and folks at the universal Administrative Company which oversees this program and others so i cant give you a specific gate but i can say over the next several we hope to report improvements. By october, November December . I can commit to that. Tell me the definition between under served and unserved. That seems to be the great debate on every program and everything we are engaging in. Which has priority, underserved or unserved . They are both important but to me it is critical to get folks who are unserved on to the other part of the ledger. It is increasingly important for folk do is have Internet Access whether you want to start a job, educate your kids, get health care, participate in civic society. It is important to bring those 30some million americans off the grid to on the grid. That is what we have been focused on. The priority is shifting more toward that or already there . I think it is largely there. If you look at the mobility phase two we are trying to attack the divide. I have seen that from myself last week when traveling through the upper midwest. There has been conversation about all areas on Digital Divide but you have an issue of means testing. I know there has been some questions about that and putting out a generic question what should we do on means testing . Just because they dont have access doesnt mean they dont the finances or they just havent chosen to. Where is that . I am working with commissioner orielly and memberoffs the star to figure out the way ford on that. Answer this question for you. I have heard it come up so far in this conversation today. The fcc is leaning more towards the big corporate interests rather than the interest of the consumer. Why would that claim sit out there . I disagree. We have been consistently making sure we have a more competitive marketplace. Reform the Broadband Program to make sure Wireless Internet Service providers have the ability to deploy. If you look at your Broadband Deployment Advisory Committee or my support of the giga bit opportunity act each initiative incen incentivizes the smaller businesses. Last week when i was visiting a fixed wireless provider in german town, wisconsin, i learned how difficult it is for them with limited budgets to compete with the bigger folks but they are critical to providing the marketplace. Robo calling is the number one Consumer Complaint people have with the fcc. The fcc only issued one citation with respect to that and we made it a top priority and why we took steps to block the calls that are coming to senator coons and millions of other americans. We are focused on getting the biggest bang for the buck. Robo calls is a big issue especially the spoof calls and not the actual numbers. I know decency standards are out there and unenforced at times. If you can enforce the existing laws and regulations there it would be a great benefit to the consumer across the country. And part of the challenge is some of those calls originate from outside of the country. I have the chance to meet with and work with counterparts broadband and i can tell the committee i have spoken with a number of them to make sure this is on their radar. It requires cooperation with International Counterparts to make sure we crackdown on all levels of these schemes. Senator ryan hall. Thank you madam chairman and Ranking Member coons. Good to be on this subcommittee and looking forward to a discussion of the fcc issues. I will say madam chairwoman, i know this isnt the committee of jurisdiction but we read reports there may be a new Health Care Bill being unveiled as soon as maybe friday or next week and i would urge all of our colleagues to urge their colleagues to have hearings on that issue just like we are having a hearing on this. It will affect 1 6th of our economy and hundreds of millions of our fellow americans and i think it is important to have a hearing on that as we look at the budgets of the fcc and other federal agencies. To all the commissioners, welcome. Chairman pai, i do join my colleagues senator coons and senator leahy in expressing disappointment with the over turning of the protections. You have a different view but in my view that makes millions of americans more vulnerable with protections over the internet and i will followup in writing on questions on Net Neutrality where we have difference and i think my colleagues express them well but i have followup. I was pleased to hear your comments about expanding access to the internet and positive comments about the Life Line Program. I think all of us want to make sure nobody is abusing it but it is true it has helped provide Broadband Access to millions more americans wouldnt you agree with that . Yes. In maryland, we have a 39 participation rate, of those eligible 39 are participating which is about 231,000. People who would not otherwise have access to the internet. In addition to the Life Line Program, what additional measures are you taking or would you suggest you take to expand access to broadband throughout the country to every neighborhood, urban, suburban and rural. That is a great question and a challenge given the terrain challen challenges we have. I am committed and now is the time to close the digital devitamdivide and you know it is important in your state and around the country to get that access. I am committed to using every tool in the fccs tool box to address meaning number one making sure we wisely spend the universal Service Funds that are under our administration, direct them to unserved parts of the country. Number two, making sure that we modernize our Regulations Inc t incentvise deployment of next Generation Networks meaning working with local governments to adopt broadband policies and that smaller people get to inthe poles. This is one of the biggest coast elements to deploying networks. The fcc is shining the spot light on the issue and working with this body. In september, i proposed the giga bit opportunity zones. I have seen in alaska native villages and poor towns in mississippi there are far too folks on the Digital Divide. Companies see there is not a return on investment in these are areas. I am committed as an american making sure they get on the right side of the divide so i proposed this initiative. I think including in the infrastructure plan if there is one to direct the federal funds to the fcc for broadband deploy it is an important issue and i would love to work with you and any of the members interest in solving the problem. Commissioner cylburn, i know you finished your tour connecting the opportunities divide we have been discussing. What are your thoughts on this . Is this an area where we can do more or where congressional action is helpful to . Yes, yes, and yes. One of the things that is the biggest driver that the biggest cause causer in terms of distress is in health. If you fall into a place where health is a challenge, that is usually the number one reason for bankruptcy. But if you have a connected community, if you have people who are able to communicate with their Health Care Professionals in telemedicine paradigm, if we can get that through life line, through satellite, go stations or whatever it is called in terms of satellite orbit. If we could do all of those in terms of the infrastructure as well as through programs that are means tested like life line is the target. We can solve many of our critical problems and the answer is yes no matter what the discipline if it is health, education or live. Connectivity is key and we have to use the tools in our arsenal to encourage opportunities. Thank you. Madam chairman, look forward to working with you and members of the committee and commissioners on some of the suggestions that were made on this vital issue. Thank you. Senator moran. Chairman, thank you very much and congratulations on becoming the chair person of this subcommittee. I know your continual efforts in regard to broadband deployment in West Virginia and obviously we care about kansas and arizona and connecticut and i look forward to working with you and senator coons to make sure the broadband is deployed. I recently saw mr. Van hollen talk about all across the country and i saw an article where Rural America is now what used to be the problem of urban core Study Centers has now spread to Rural America based on the statistics. We are all looking for hope and this is a technology and telecommunication is one of the areas where i think we can provide hope for parts of the country all of us care so deeply about. I want to take a moment, commissioner orielly and commissioner cylburn, chairman pai, you are three commissioners i have very much appreciated working with. Without exception we have a Good Relationship of the significant response and care of concern me and my staff raised and i look forward to that relationship continuing. There was contention in past commissions and i am not here to debate how well you all got along but i know from time to time commissioner cylburn you are opposed to some of the decisions that the commission is making but i hope you assure me you feel your voice is being heard and you have the opportunity to participate in the process that sometimes seemed missing in the past commission. Most of the time i feel that way, sir. That is a good solid answer. I would encourage the chairman and commission to work closely togethers. None of this is easy but voices need to be heard and results. Commissioner orielly . I am bias on this topic i must admit. But in fairness, i think they have done a wonderful job setting the tone of the commission. There has been a breath of fresh air. I dont know if we can speed. [laughter] , if not well talk to his mom and dad. Perhaps the place to start is with you on were looking for a smooth and orderly process, i want to be certain that no broadcasters forced to go dark through no fault of their. Weve had this conversation numerous times with all of you. I assume your commitment remains to work with us to make sure adequate resources are provided to the impact broadcasters. Yes. If is expected to 1. 75 billion currently authorized to pay these moves in broadcasters is insufficient how we go about covering them. Is it going to be a pro rata circumstance in which you meet up payments for everyone where you pay in full those who move first . Is there other method by which you can treat the circumstances you find yourself in with that amount of money . We are in the early stages in this point and waiting to receive cost estimates from the broadcasters. We estimate thats by july the 12th. The staff will take a look at all the estimates that come in and determine which are reasonable and aggregate them to figure out which is the number we think will be required. If that number is greater then you have my personal commitment to come to congress so that congress will make the appropriate ask that the sec would do we havent yet determined. Hopefully will be able to work with you cooperatively. I worry about the slowness of congress. If you come to us and theres is shortfall of money how long will it take for us to respond i would encourage the commission to be prepared to figure out how they treat forecasters in that circumstance which i think can help us if that occurs. One of the things is to ensure that broadcasts are treated fairly. One part of that is not having to go out of pocket. I look forward to working with you in any members of the subcommittee on the. We have had concern for role in small broadcasters were the demand for movement will occur early in the larger broadcast areas and i want to make sure i know i see your finger that did not sound good for we want to make sure those are not left behind in the process. Absolutely. We have space out the repack over ten different phases. Weve taken different steps to make sure that broadcasters are aided were circumstances beyond their control have impacted their ability to repack smoothly. We are taking steps to make sure broadcasters like that are treated fairly. Inconsistently with the law. Think very much. I would like to wish my fellow West Virginia a happy West Virginia day. Our state was formed in 1863. I would like to wish my wife a happy birthday. They had one of the lowest rates of broadband in the nation when they voted to modernize the program in 2011. In 2016 thats where we remain, so the loss. Caps and coverage still exist and must for ginny. And data has failed remote communities. To help address the problem we enter deuce the rule Wireless Service act of 2017. The legislation standardize the fcc collects mobile data and collects an accurate picture of the world world coverage experience currently available to consumers. The website notes his current data has limitations that likely result in an overstatement of coverage. Weve talked about this. We cannot afford to liberal america behind and we are very concerned about this. So what steps are you taking to address this . This is something i take seriously having been to West Virginia and having seen how you cannot get a signal in places in areas. You have been there havent you . Have been desperate situation its very hard when you have an area hit by a flood the people are calling 911. I visited the 911 call center and talk to the director about how hard it was to make sure people were safe where places where connectivity cannot be a given. We want to change that part of changing it is making sure the data is accurate. Im aware the map has not been updated for several years. We want to make sure the data is accurate. We are actively working with our staff at to make sure that we have the right input so the outputted trauma policies the right one for West Virginia in the country. Anyone else with comments on that . I agree that form process needs to be approved, when he more data and we need staff to do so. We also need to make sure Going Forward with the Mobility Fund that we have a challenge process that all companies the matter size or scope that they can weigh in. If you look at the topography of the state is not chances. Kansas might be rule, but its flat. We have challenges to come have beauty. Im aware of the beauty im encouraged by the commission theres almost 13000 locations alone that are eligible for this fund support. They still lack access weather simply no Business Case for provider to serve without our support. I believe the remote area, would you like to discuss this. This is been a difficult issue for me. Its the hardest places to serve the been put at the bottom of the list in terms of priority. The chairman has increased the timeline and effort for three years ive been pushing, not confident at this moment that by the time i term expires that we will have finish. When you look at appalachia its hit all across the board. We get the people connected they get a chance to survive. Just last week we talked about legislation on a National Broadband map. As you know the commission is not meaningfully updated the map since it inherited it from the administration. The gao report would take a look i guess how do we Work Together . How much effort money are you putting towards revitalizing this . Its a priority for us. Do you have the resources . I believe we do. You know the urgency . Working to be in a stalemate if we cannot get connected. I think the senator and i both understand being around our stay when i was governor we had less than 50 of the area we have every school and post office where public building is connected today, we dont have the market to drive it out. Thats where we are dead in the water. You have my personal commitment. Just last week i drilled over 1500 miles to casper wyoming and visited everything from the sioux reservation to the farm town in spencer, iowa. I saw how difficult it was in some of the places to make sure people have Digital Opportunity. Its a top priority. Will they said its at the bottom of the priority list for so long. I hope all of your committed to putting it on the top of your priorities. Thank you senator. I think all of you for being here and thank you for your willingness to serve. I know youre working hard for the best interest of the country. My question had to give with rural broadband. I think they been covered well. Its interesting the committee is made up with rural areas and as you can see from the questions probably the majority of the questions youve been asked has to do with that. Its a very important. One of the things that has been talked a lot about and has had good bipartisan support and i think it has the opportunity for bipartisan support is an infrastructure package. We talk in terms of railroads, runways, and roads, the three rs but we do not talk a lot about the infrastructure in terms of broadband. You can have all of those in place and if you are not connected as members are talking about stories and youve related stories it just doesnt work. So what i would like to know commissioner, and the rest of you can chime in also. But, i hope we have a Firm Commitment from you in the sense of wanting to weigh in and be part of the infrastructure package the sense of giving good advice so we can include not just the three rs but broadband in any package that comes forward. Absolutely. We defer to the elected branch of the government, but i said to the extent congress is considering this package i would hope broadband is a part of that. Its important for all walks of American Life from agriculture and healthcare theres too Many Americans who dont have it. Im certainly committed. We make the decision, but where you can be helpful is just giving good information in the sense of thats really what its all about. Unless most of us have the opportunity to be all over the states ends were in the lancet it does get very difficult. Commissioner oreilly. Is going to make two points. If the decision is made of infrastructure i hope you look at the high cost one for purposes of where the dollars are spent instead of creating a new program. I think thats something we have to man for that we cant me with the current dollars that could be filled in with added dollars. To you look at authority in terms of the Commission Authority to push back on the barriers of employment that have been imposed by state, local, tribal governments. We want to be respectful of them but ive been working on this for 25 years some of these are the same problems from 1995. Twopart said dominate, one is the cost and the second is the approval process. Pushing back against a tribal. Yes. What specifically too many . We have some authority and i think its extensive authority but it will be added if congress were to amplify the points to make clear that we want broadband to point. Theres things already banned by localities and states such as exposer and extended set come back, effective moratorium is already happening and so we have to fight over what the languages. If congress can clarify it that would be helpful. I think we need to make sure that our houses in order. What i mean by that is, when we approve and consider look and evaluate different technologies we need to make sure theyre appropriate for the surroundings. Stream fiber to me might not be the best way to connect me. We have satellite, and she is sos, we have whites to be wide spaces and other things that we need to make sure are on par to be green lit by this agency. So what everybody said and what we havent thought about. Thank you madden chairman. Thank you very much, and congratulations, im honored to call you sure will. Well done. I want it think the chairman and commissioners for coming out to testify. As you are aware its a rule states at a rural tone to todays hearing. When you are from an urban area you can take connectivity to great credit. We do not take it for granted in montana. If you look at the maps the commission has put up you see gaping holes across the west. This is not only barrier for businesses, individuals its a Public Safety issue on is the commissioner has stated the maps do not even reflect the actual coverage in many areas. I pick up a lot of miles on in montana we measure time in terms of tire changes. We see areas where there is no cell coverage but alone lte coverage. So we very much look forward to working with you to close the gap. The commission recently completed an incentive and is working on the repack and move of broadcasters to Wireless Companies in the spectrum they purchase. This is an important step forward to expanding broadband into rural and tribal communities. We must make sure we balance the rights of Wireless Companies to have access to the spectrum they want with the needs of broadcasters who have to vacate that spectrum. Can you promise and commits work with all those affected by the incentive and with congress, if needed to make sure this transition will go smoothly as possible . Yes i will. I feel like im getting the marriage from sears something. [laughter] sorry, i will commissioner riley, another issue we have seen in montana is inhibiting the expansion of broadband. Its spectrum squatting. Some companies are buying up spectrum and not deploying it in the areas that need it. Instead sitting on it and selling it at a higher price. What enforcement and authority actions including tightening the rules can the sec take to make sure spectrum is used properly and efficiently and not placed on a shelf awaiting maturity . It in fairness most Companies Expedite the employment of wireless frequencies as soon as possible because they need them for advancement of their networks. We can tighten our buildout requirements unless the timing and percentages needed to comply to make sure they maintain their license. We could do that Going Forward. You can go backwards on but we can tighten Going Forward. It has been an issue for southwest. Chairman and commissioner i have been impressed with the ways that tv white spaces can be used to better serve rural communities, including use in education, and Public Safety and rural health. How do you see the use of tv white spaces being used to get Broadband Access to hardtoreach areas which is lacking today . A be quick and say is more affordable. It allows for more entry of smaller providers and some of the existing providers to do things that a less expensive cost. To be able to get rid of the burdens in the hurdles have mostly been economic. Another way that would be not legacy, to get to collecting communities to media underline has been cost entry door tremendously. For very small budgets that are struggling on revenues we dont need it beyond what the white space can be delivered. I think they captured while the gist of whats at stake. Ive had the chance to talk about myself and so we are actively working on it at the moment. One of the main goals of the commission is to protect consumers they were folks into false security. They think its perhaps somebodys okay. Skimmers are Getting Better and i think its our responsibility. I dont want to be dismissive of your question its important. But is something we will address in two days from now. We have an item before study think the chairman will address. There is the ability to get the number that is local even though your outside the area. Its not necessarily spoofing. But in terms of trying to commit fraud. We had a conversation i like to say legal cause because of an itself it can have benefits. This fine lines here. And a two days it was going to happen . Im not sure if im allowed to reveal any more information. I can say that weve already taken steps to address this issue. We allowed some of the carriers to block spoof calls that are from on a side numbers. The kind person in the united states. We also wanted to allow consumers to say to the phone company, tonight carrying a call but its not for me. Kind of a do not originate call. So to make sure that the person who is calling is that person is not me trying to pitch you and senator constrained to call you. It seems like a simple thing but its very difficult sometimes. I need to move this faster. Thank you. I have one additional question and i think senator koontz has a question or two. Like to begin first of all with thinking all of you for being here and think the chairman for the transparency initiatives that you put forward. You getting into college for silly areas of the more transparent you can be the better. Glad you made moves in that direction. I would encourage more. My last question is on the funding that is relatively new for the unserved and underserved moses 16 that it started . When the money going for the six years on the last two. The rate of return in 16, then to have any data . When im concerned about is for instance in our state 38 million per year additional firstrate for underserved and unserved areas. Weve heard a lot of concern due to concerns about the mapping and the accuracy of the data. We know anecdotally as we walk around it sounds like all we do will we go homes go to the grocery store, maybe that is all we do. Yours getting approached that says i cant get internet or madonna can tour homework on the nika back to the carrier is like we serve that area when in actuality its underserved or unserved. What we have when you spend all of this money when you will really get the results that you desire. Unserved has been the commissions focus as opposed to those that have service, thats the main priority of the commission will continue. In terms of the dollars, will try to pick better pinpoint the dollars on how their are spent. Periodparagraph it will help with that. Hopefully data will improve hopefully it is done in a broader sense and were trying to pinpoint it as best we can Going Forward. Thank you. Under ownership rules do they reach more than 39 of the country to ensure independence, variety and inclusion of local minority voices . They are working to reinstate the uhf discount which some would argue unwinds the requirements. Now youre considering a merger which could create a massive broadcast group with access to three quarters of all u. S. Households, to believe that 39 limit should be in place as a barrier to over concentration of the market . What factors will you be reviewing Going Forward . Thank you for the question. Its very preliminary. The discount decision that we made earlier was returning to the status quo. The argument i made back then was that we cannot repeal the discount without considering the adjustments in the national cap that were necessary. We have not made determinations about what that number should be. Our point was that as one goes so does the other. We have to consider the national cap. And of course we have not received papers with respect to the transaction so i dont know how they might affect. And last i referenced in my opening questions that the current budget plan is to buy attrition i think it was 102 ftes. I did not hear clarity about what the plan is are im concerned about whether the regular daytoday functioning of the agency is supposed to continue moving forward on things that might not be policy issues but need to get move forward to predictability whether they will continue or whether you expect significant disruptions. A critical question, im confident we will not experience any negativity like that. I recently met with an fcc team that handles the rate appeals. Theyre looking for e rate funding for whatever reason they been in the appeals process and they have been around for almost 20 years. So release it recently found we need to prioritize longest once and ive met with them to hear about the hard work and theres challenges. By the end of the day you will get the resources you need. These are institutions that are critical to American Society we need to make sure we give them an answer in a more timely way. In areas like the will make sure we meet the course responsibilities and deliver value. If you have concerns about Staffing Levels are also welcome hearing that as well. I will add to that, i support with the chairman put forth. Well use it in a good example when you squeeze it in one place there goes to another. That is not necessarily always positive. Resources are individuals could be taken from somewhere else and that could slow down efficiencies and other places. I agree but continual you know what her situation is any new or faced with. Were asked to do more with less, i am positive there will come a time where well have diminished marginal returns and i think that is quickly approaching. I will add that we talk about rule broadband most of those decisions and hard work done by the good folks working in the high cost program. Ive been working for many years now and the number of items have to be stacked up because they dont have the research. That doesnt mean we can allocate them from elsewhere. For do the budget that has been put forward. I think we can do both. I was just suggesting they could use additional resources. Thank you. Thank you for you graciousness and i appreciate your dedication to moving forward. Thank you when i think all of you again, particular witnesses for the testimony today. If there is no further questioned the record will remain open till tuesday june 27 and you can submit any statements or questions for the record. This hearing is adjourned. Thank you. [inaudible] [inaudible] [inaudible] ,. [inaudible conversation] [inaudible conversation] [inaudible conversation] [inaudible conversation] [inaudible conversation] [inaudible conversation] [inaudible conversation] [inaudible conversation] [inaudible conversation] [inaudible conversation]
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