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FCC Chair Pai says recovery funding to P.R. to be allocated by towns

Federal Communications Commission Chairman Ajit Pai said the funding the agency is proposing to assign Puerto Rico will be disbursed on a competitive basis by geographic area, or towns, to repair and restore telecom networks and services destroyed by Hurricane María.

In a news conference, Pai also confirmed the FCC will hold awarded companies to rigorous accountability standards to make sure the “money is used for what it is supposed to.” The money would come from the Universal Service Fund, he said.

“Under my administration we have been much more firm about companies that receive federal funds from the Universal Service Fund, using those funds specifically for the purpose of building the infrastructure,” said Pai, adding if companies fail to use the funding properly, they have to pay it back to the agency.

Pai, who has been supporting the U.S. island territories in the wake of Hurricanes Irma and María, unveiled Tuesday a package to direct some $954 million to the islands.

Specifically, he proposed to create a $750 million “Bringing Puerto Rico Together Fund” and a $204 million “Connect USVI Fund.” Each of these funds would provide additional short-term assistance for restoring communications networks in the aftermath of the storms and longer-term support for expanding broadband access throughout the islands.

The proposal now must be approved by the other FCC commissioners.

“If this plan is approved in its current form, you will see that we have very specific requirements that companies use the money that we’re allocating for this purpose specifically for the restoration and improvement of these networks,” he said.

The funding allocation would be done under a competitive bidding format, through which participating companies would present a proposal to repair or build out a network in a specific “municipio” (municipality), he said.

Pai met with Gov. Ricardo Rosselló, Resident Commissioner Jenniffer González, Telecommunications Regulatory Board President Sandra Torres and industry executives to discuss plans for the renovation and expansion of the telecommunications network.

Representatives from Claro Puerto Rico, Neptune Networks, AT&T, T-Mobile, C&W, Worldnet, Critical Hub, Telrrite, PR Wireless, Aeronet, Liberty and others were present.

Among other things, Pai acknowledged that one of the main problems the island’s telecom sector faces is that for the most part, their infrastructure runs on electricity. Puerto Rico’s grid was completely destroyed by the storms, and telecom services were also down as a result.

“Under the law, the FCC’s authority is relatively limited. We don’t have authority over the power system, we don’t have the ability to extend funding to restore that power system. So it’s a cooperation that has to happen between telecommunications and energy companies,” he said.

But he said the FCC has the ability to give telecom companies the tools they need to restore their services.

As unveiled Tuesday, Pai’s proposed recovery plan for the island includes:

  • An immediate infusion of approximately $64 million in additional funding for short-term restoration efforts. Of that amount, $51 million would be assigned to Puerto Rico.
  • A proposal to allocate approximately $631 million in long-term funding for the restoration and expansion of fixed broadband connectivity in Puerto Rico and the USVI.
  • A proposal to allocate approximately $259 million in medium-term funding for the restoration and expansion of 4G LTE mobile broadband connectivity in Puerto Rico and the USVI.
  • The immediate conversion of the advanced funding the FCC provided last year to carriers in Puerto Rico and the USVI into new funding by declining to offset that advanced funding against future universal service support payments.

The plan calls for the FCC to devote almost $1 billion in funding both to the short-term, efficient restoration of service and the long-term improvement and expansion of broadband throughout Puerto Rico and the USVI.

“With the 2018 hurricane season less than three months away, we need to take bold and decisive action,” he said. “This is why it was important to us to infuse short-term money to be able to get the networks as restored as possible,” he said.

Author Details
Author Details
Business reporter with 30 years of experience writing for weekly and daily newspapers, as well as trade publications in Puerto Rico. My list of former employers includes Caribbean Business, The San Juan Star, and the Puerto Rico Daily Sun, among others. My areas of expertise include telecommunications, technology, retail, agriculture, tourism, banking and most other segments of Puerto Rico’s economy.

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