Latest from Washington: An Update on the Connect America Fund Phase II Auction

At its January 30 meeting, the FCC adopted a Public Notice and a Reconsideration Order finalizing the rules and procedures for the Connect America Fund Phase II. You can access both the notice and order on the FCC’s home page (www.fcc.gov) under “Headlines.” For those who might be interested in bidding in the auction for nearly $2 billion in support over the next decade, here are the key dates:

• FCC Tutorial on the Application Process – March 13
• Short Form Application Window – March 19 through March 30
• FCC Tutorial on the Auction – June 28
• Mock Auction – July 16
• Start of Auction – July 24

For the short form application, the bidder will need to demonstrate that it is operationally and financially qualified to participate and will need to indicate the states in which it will bid and the performance tier for the service it will provide. If the bidder wins, it will file a long form application with additional information. The Public Notice sets forth in detail all of these requirements, and you should read it carefully.

The Public Notice also sets forth the auction design. In brief, the auction will be a multi-round reverse auction with reserve prices set by the FCC’s Connect America Cost Model and with “lots” of eligible census blocks grouped by census block group (the minimum geographic area for bidding).  Bidders are able to package census block groups within a state in a single bid.  Bidding will then go down in increments from the reserve price until a winner is determined. 

One final word:  to ensure that the auction process is fair to all bidders and will produce the best outcome, the FCC expects all bidders to be diligent in seeking to understand the rules and to follow them closely – and the FCC will enforce the requirements strictly. If you do not understand something, call the FCC. They will be more than glad to help.