Seven associations representing US broadband providers have sent a letter to the Federal Communications Commission (FCC) urging it to revise the letter of credit (L/C) requirements proposed for the Rural Digital Opportunity Fund (RDOF).

The commission has previously said it would not change the L/C terms in the RDOF.

FCC resistance

The FCC has so far declined to adopt the alternatives to L/Cs that were suggested by those who commented on the commission's proposal to use L/Cs to guarantee the providers meet their obligations.

"Letters of credit better achieve our objective of protecting the public's funds," the FCC said in a statement.

The commission said it recognised that participants in the latest broadband auction, including small entities, have expressed concerns about the costs of obtaining and maintaining L/Cs.

Modified L/C requirement

In response to those concerns, the FCC says it has now modified its requirements to allow support recipients to reduce the value of their L/Cs once they have met the 60 per cent service milestone.

The association's letter says that if further modifications to the L/C requirements are not made, "many companies could be effectively barred from participation in the auction and those that do will not be able to bid on the full amount of locations they might otherwise be able to serve because of the difficulties in obtaining and the cost of the required credit."

This article represents the views of the author and not necessarily those of the ICC or Coastline Solutions.