FCC Chairwoman Jessica Rosenworcel has raised concerns over a significant funding gap in the initiative to eliminate Huawei and ZTE equipment from US networks, citing a shortfall of $3 billion in allocated funds.
In a letter addressed to Congress, Rosenworcel highlighted that the Reimbursement Program would require approximately $4.98 billion to cover all “reasonable and supported” cost estimates in approved applications. This starkly contrasts with the current appropriation of $1.9 billion, resulting in a notable deficit.
According to Rosenworcel, nearly 40% of program participants indicated their inability to carry out essential “rip and replace” tasks without additional government support. Some recipients even warned that the funding shortfall might force them to shut down networks or withdraw from the program entirely.
The Reimbursement Program has received over 20,000 reimbursement claims, with the agency granting 64 extensions for completing “rip and replace” obligations. More than half of these extensions were prompted by financial constraints, according to sources.
Due to the shortfall, the Commission is prioritizing applicants serving two million or fewer customers, providing them with only 39.5% of reasonable costs in prorated support.
Rosenworcel stressed that the incomplete removal and replacement of Huawei and ZTE equipment pose serious national security risks by maintaining insecure elements within US networks. Moreover, the piecemeal replacement could lead to compatibility issues across the network infrastructure.
“The successful implementation of the Reimbursement Program is one of the Commission’s top priorities,” stated Rosenworcel. “I am writing to emphasize again the urgent need for full funding of the Reimbursement Program.”
This call for additional funding underscores the critical importance of safeguarding US telecommunications infrastructure against potential security threats associated with foreign-made equipment.
