The Federal Communications Commission (FCC) recently urged operators to ensure money awarded to them in the Rural Digital Opportunity Fund (RDOF) Phase I auction wouldn’t go toward unnecessary coverage, and they responded – with a wave of waiver requests. As a result, millions in broadband funding could be left on the table.
Top RDOF winners including LTD Broadband, Windstream, Frontier Communications and Starry, were among those seeking to relinquish winning bids without penalty, after receiving warning letters from the FCC last month. Collectively, the waiver requests cover thousands of census blocks across at least 26 states.
The FCC issued letters to a total of 197 RDOF winners, flagging potentially redundant funding in a total of 15,187 census blocks. Operators had until August 16 to request waivers for these areas.
LTD Broadband requested waivers for more than 3,000 census blocks spanning California, Colorado, Iowa, Illinois, Indiana, Kansas, Minnesota, Missouri, North Dakota, Nebraska, Ohio, Oklahoma, South Dakota, Texas, Wisconsin. The operator was notably the top bidder in the RDOF auction, winning $1.3 billion in funding to provide service to 528,000 locations across those 15 states.
In a filing, LTD stated the blocks it is seeking waivers for “consist of locations that are already served by one or more service providers that offer 25/3 Mbps broadband service or otherwise raise significant concerns about wasteful spending (e.g., an airport or parking lot with no locations).” It added the blocks “represent millions of dollars in RDOF funding that can be repurposed to fund areas that are actually underserved.”
Starry, which was ninth on the RDOF winner list with $268.9 million in funding, sought waivers for a total of 121 census blocks. These included six blocks in Alabama, three in Arizona, six in Colorado, 28 in Illinois, 18 in Nevada, one in Mississippi, four in Ohio, 16 in Pennsylvania and 39 in Virginia.
Meanwhile, Frontier asked to be released from winning bids covering 37 census blocks in California, Pennsylvania, Texas and West Virginia after determining “certain census blocks were solely parking lots and portions of airports” while others “were made up of large commercial buildings with access to commercial fiber.” Frontier was seventh biggest winner in the RDOF auction, securing $370.9 million in support.
Windstream put in for waivers for 29 census blocks due to concerns “that some of the blocks may have no serviceable locations,” but did not specify which states these were in. The operator won $522.9 million in the RDOF Phase I auction.
Other filings included requests from Mediacom seeking waivers for 24 census blocks in three states and Midcontinent Communications asking to return 16 bids in three states in areas it said would “either would be difficult to serve or that may already receive broadband service.”
It is unclear exactly how much funding is associated with the waiver requests mentioned above. Last month, the FCC revealed more than 60 bidding entities have already defaulted on winning bids totaling $78,533,385.30 and covering nearly 11,000 census blocks.
According to RDOF rules, operators in default of winning bids are subject to a penalty of $3,000 per violation. But the FCC said in its warning letter last month it would consider waiving the fees if operators could demonstrate why defaulting on their bids would serve the public interest.