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   Mr. GRAMS. Mr. President, I rise today to express my views toward Federal implementation of the 1996 Telecommunications Act and my support for a strong national rural telecommunications policy.

   One of the most important responsibilities of a United States Senator is to exercise appropriate oversight of Federal regulatory agencies to ensure sound policy and the wisest use of taxpayers dollars. Toward this end, I have carefully monitored the Federal Communications Commission's implementation of the 1996 Telecommunications Act in an attempt to ensure that this agency follows the intent of Congress in developing a strong national rural telecommunications policy.

   I am proud to have supported the historic 1996 Telecommunications Act which deregulated the telecommunications industry for the first time in 62 years. I believe this Act has begun to reach its promise of a competitive marketplace, lower prices, and greater consumer choice in services for every American. Since its passage, the telecommunications industry has grown dramatically, creating 230,000 more jobs nationwide, generating an additional $57 billion in revenues, and fostering an environment in which billions of dollars has been invested in telecommunications infrastructure. Despite this promising news, I am very concerned that the FCC's implementation of the Act has stifled the expansion of some of these benefits into rural parts of Minnesota.

   As a former small businessman, I often hear about the regulatory burdens experienced by my state's entrepreneurs and businesses. As someone who spent 23 years in the broadcasting industry, I also understand their frustration with the far-reaching regulatory authority of the Federal Communications Commission. It has become very clear to me that the administrative and regulatory burdens imposed upon small telecommunications providers reflect the Commission's neglect for the unique needs of rural telecommunications companies and their need for fairer regulatory treatment.

   The concerns of rural telecommunications companies are underscored in a letter sent to me by Farmers Mutual Telephone Company General Manager Robert Hoffman, who wrote, ``My concern with the FCC is all the additional filings and requirements they are placing on small telephone companies. A couple of years ago we didn't have any filings with the FCC. Now we have about ten annual filings which are confusing and labor intensive, and thus expensive for companies of our size. The FCC has no sympathy for small rural telecommunications companies.''

   As my colleagues know, this de-regulatory law has been the subject of litigation from the moment it was enacted due to what many perceive to be the FCC's over-regulatory approach to its implementation. Far too often, the Commission's rules have gone beyond Congressional intent. In particular, I am disappointed by the Commission's implementation of sections of the Act which are intended to preserve universal service assistance and the deployment of advanced telecommunications services. I am sure that my colleagues would agree that universal service assistance is the cornerstone of an effective rural telecommunications policy.

   In implementing the 1996 Act, the Commission has thus far failed to adhere to the important universal service principles established by Congress under this law. The Act specifically required the joint board on universal service and the FCC to base their universal service policies upon the following principles: the ability of quality services to be provided at just, reasonable and affordable rates; that all regions of the country should have access to advanced telecommunications services; that telecommunications services should be comparable to services in urban areas; and that universal service should be supported by specific and predictable funding mechanisms. Congress should clearly do more to hold the Commission's feet to the fire to ensure that there is proper implementation of universal service support.

   I have worked hard in Congress to ensure that the decades-long policy of universal service is preserved and advanced and that there are adequate revenues to maintain rural networks. Earlier this Congress, I wrote to FCC Chairman Kennard to express my opposition to any proposal which would transfer authority over the Universal Service Fund to the Department of Treasury. I believe that such an approach would undermine universal service policy and could have an adverse impact upon small telephone carriers and the communities they serve. More importantly, this plan would place the Universal Service Fund at great risk of manipulation by the federal government and the excessive spending habits of Members of Congress. I am pleased that the Administration has finally agreed that is not ``public money'' and has withdrawn this ill-advised plan.

   I also believe that the Rural Utilities Service telephone loan program is vital to the development of a strong rural telecommunications infrastructure, and an essential component of our national commitment to universal service. I have repeatedly written the Senate Appropriations Committee to urge funding for the Rural Utilities Service telephone loan program. I firmly believe that RUS telephone loans have helped to improve telephone service in rural and high cost areas. Through RUS financing, telephone borrowers have made significant improvements to telecommunications services throughout rural Minnesota.

   My oversight of the FCC has also included efforts to make it easier for

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   For these reasons, I was pleased to join this past April with twenty-five of my Senate colleagues in a writing the Commission to urge that it extend the June 30, 2000 CALEA compliance date for software upgrades by small carriers by one year. I regret that the Commission has a different interpretation of the needs of rural carriers in meeting this compliance date. I expect that the Commission's new process by which individual carriers could petition for and receive extensions to comply with CALEA has been time consuming and burdensome for small telephone carriers. I would be supportive of legislative action to address problems with CALEA compliance.

   During this Congress, I have also worked with the Minnesota Association for Rural Telecommunications and the Minnesota Telephone Association to encourage local phone competition in Minnesota by urging the Commission to address the petition filed by the State of Minnesota in 1997 on whether its ``Connecting Minnesota'' proposal between the state and a private company was consistent with the rights-of-way criteria established through Section 253 of the Act. Not surprisingly, it took the Commission nearly two years to analyze and rule upon the State of Minnesota petition. Rural consumers may witness additional entrants into local television markets following the Federal Communications Commission's decision to deny the petition.

   Bringing technology to rural areas has always been a top priority for me. As a member of the Congressional Internet Caucus, I have supported policies to address the growing concern in Minnesota about the ``digital divide'' and access to the Internet. High-speed Internet access is a key to improved economic development in rural communities and important to Minnesota's farmers, schools, small businesses, and hospitals. For these reasons, I strongly disagree with the Commission's interpretation of section 706 of the Act which requires the agency to encourage the deployment of high-speed Internet access and other advanced communications services to rural Minnesota. In my view, inaction by the FCC in removing barriers to the deployment of advanced telecommunications services can be overcome through the enactment of incremental proposals that complement marketplace solutions.

   More specifically, I am proud to be a cosponsor of the ``Universal Service Support Act'' introduced by Senator CONRAD BURNS and endorsed by the National Telephone Cooperative Association. This legislation will lift the regulatory caps imposed upon the Universal Service Fund that limit the amount of support that can be directed to rural telephone companies that serve high-cost areas of our state. These regulatory caps are inconsistent with the de-regulatory framework established by the 1996 Act and an unnecessary barrier to allowing further the further deployment of advanced telecommunications services in rural communities.

   I believe that we can also prevent rural communities from becoming technology ``have nots'' through repeal of the federal telephone excise tax. The 3 percent telephone excise tax was first established to fund the Spanish-American War of 1898 but has since become an obstacle to community investment in technology. I am proud to be a cosponsor of legislation to repeal this ``Tax on Talking'' and save taxpayers billions annually.

   There is no single solution to closing the digital divide and I also support S. 2572, the ``Facilitating Access to Speedy Transmission for Networks, E-commerce and Telecommunications Act,'' also known as the ``FASTNET Act.'' This legislation will relieve mid-size telephone companies of excessive reporting requirements that are a barrier to additional company investment in Internet services that would serve rural communities. This legislation was passed unanimously by the House of Representatives and I hope that it will be considered by the Senate soon. Congress should also consider proposals that will authorize the Rural Utilities Service to provide low-interest loans to companies that are deploying broadband technology, as well as legislation that will analyze the feasibility of allowing low power television stations to provide data services to rural areas.

   As we embark on the 21st Century, it is vital that Minnesota's high-tech businesses serving rural areas are not left behind in our new e-commerce economy. During this session of Congress, I was an early and strong supporter of the enactment of ``E-SIGN,'' electronic signature legislation that will facilitate the growth of electronic commerce into rural Minnesota. This new law grants legal effect to electronic online electronic signatures that will enhance the ability of rural companies to complete business transactions and compete in our emerging digital economy. Rather than spend precious time and resources completing paper transactions, the E-SIGN Act will also allow consumers to pay bills, trade securities, and shop online for a home mortgage and complete the deal by striking a few keys on their computer.

   Finally, I am proud to have worked with my colleagues on the Senate Banking Committee to pass the ``Launching Our Communities Access to Local Television Act of 2000.'' The LOCAL TV Act would establish a $1.25 billion loan guarantee program to facilitate access to local television programming in rural Minnesota communities. I am very pleased that the Senate unanimously passed my amendment that will ensure that the National Cooperative Finance Cooperation is considered an eligible lender under the proposed loan guarantee program. The CFC is among several private sector lenders which have substantial experience providing multi-million loans in a cooperative environment and which have a track record of projects of this size in rural areas. I am confident that this legislation will be signed into law later this month.

   I am proud to have worked with consumers and Minnesota's rural telecommunications companies on these issues and other initiatives that will help our state and country to develop a strong rural telecommunications policy.

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