Federal Communications Commission FCC 97-157 Corrected .
Federal Communications CommissionFCC 97-157Corrected VersionBefore theFEDERAL COMMUNICATIONS COMMISSIONWashington, D.C. 20554In the Matter ofFederal-State Joint Board onUniversal Service))))CC Docket No. 96-45REPORT AND ORDERAdopted: May 7, 1997Released: May 8, 1997By the Commission (Chairman Hundt and Commissioners Quello and Ness concurring andissuing separate statements; Commissioner Chong concurring in part and dissenting in part andissuing a separate statement):Table of ContentsI.ParagraphIntroduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1II.Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21III.Principles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43IV.Definition of Universal Service: What Services to Support . . . . . . . . . . . . . . . . . . . . . 56A.Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56B.Designated Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58C.Feasibility of Providing Designated Services . . . . . . . . . . . . . . . . . . . . . . . . . . 88D.Extent of Universal Service Support . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94E.Quality of Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97F.Reviewing the Definition of Universal Service . . . . . . . . . . . . . . . . . . . . . . . . 103V.Affordability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 108A.Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 108B.Affordability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109VI.Carriers Eligible for Universal Service Support . . . . . . . . . . . . . . . . . . . . . . . . . . . . .A.Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .B.Eligible Telecommunications Carriers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .C.Definition of Service Areas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .D.Unserved Areas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1127127130182194
Federal Communications CommissionFCC 97-157VII.Rural, Insular, and High Cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 199A.Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 199B.Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 208C.Universal Service Support Based on Forward-Looking Economic Cost . . . . . 2231.Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2232.Scope of Costs to Be Supported . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2243.Determination of Forward-Looking Cost for Non-Rural Carriers . . . . 2324.Determination of Forward-Looking Cost for Rural Carriers . . . . . . . . 2525.Applicable Benchmarks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2576.Share of Support Provided by Federal Universal Service Support . . . . . .Mechanisms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 268D.Mechanism for Carriers Until Support Is Provided Based on Forward-LookingEconomic Cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2731.Non-Rural Carriers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2732.Rural Carriers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 291E.Use of Competitive Bidding Mechanisms . . . . . . . . . . . . . . . . . . . . . . . . . . . . 319VIII.Support for Low-Income Consumers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .A.Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .B.Authority to Revise Lifeline and Link Up Programs . . . . . . . . . . . . . . . . . . . .C.Changes to Structure of Lifeline and Link Up . . . . . . . . . . . . . . . . . . . . . . . .D.Services Included in Lifeline and Link Up . . . . . . . . . . . . . . . . . . . . . . . . . . .E.Implementation of Revised Lifeline and Link Up Programs . . . . . . . . . . . . . .IX.Issues Unique to Insular Areas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 410X.Schools and Libraries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .A.Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .B.Telecommunications Carrier Functionalities and ServicesEligible for Support . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .C.Discount Methodology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .D.Restrictions Imposed on Schools and Libraries . . . . . . . . . . . . . . . . . . . . . . .E.Funding Mechanisms for Schools and Libraries . . . . . . . . . . . . . . . . . . . . . . .F.Access to Advanced Telecommunications and Information Services . . . . . . .G.Sections 706 and 708 of the 1996 Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .H.Initiation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .426464552583587601606Support for Health Care Providers. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .A.Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .B.Services Eligible for Support . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .C.Eligibility of Health Care Providers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1.Defining Eligibility for Health Care Providers . . . . . . . . . . . . . . . . . .608608609638638XI.2326326329341383408424424
Federal Communications CommissionD.E.F.G.FCC 97-1572.Defining Rural Areas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3.Definition of Health Care Provider . . . . . . . . . . . . . . . . . . . . . . . . . . .Implementing Support Mechanisms for Rural Health Care Providers . . . . . . .1.Identifying the Applicable Rural Rate . . . . . . . . . . . . . . . . . . . . . . . . .2.Identifying the Applicable Urban Rate . . . . . . . . . . . . . . . . . . . . . . . .3.Competitive Bidding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4.Insular Areas and Alaska . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .646653657657664686690Capping and Administering the Mechanisms . . . . . . . . . . . . . . . . . . . . . . . . . 7021.Selecting Between Combined or Separate Support Mechanisms for HealthCare Providers and Schools and Libraries . . . . . . . . . . . . . . . . . . . . . . 7022.Funding Cap . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 704Restrictions and Administration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7171.Restrictions on Resale and Aggregated Purchases . . . . . . . . . . . . . . . . 7172.Bona Fide Requests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7243.Selecting Between Offset or Reimbursement forTelecommunications Carriers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 732Advanced Telecommunications and Information Services . . . . . . . . . . . . . . . 738XII.Interstate Subscriber Line Charges and Carrier Common Line Charges . . . . . . . . . . .A.Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .B.LTS Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .C.SLC Caps . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .D.CCL Charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .E.Replacement of LTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .750750753760767769XIII.Administration of Support Mechanisms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .A.Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .B.Mandatory Contributors to the Support Mechanisms . . . . . . . . . . . . . . . . . . .C.Other Providers of Interstate Telecommunications . . . . . . . . . . . . . . . . . . . . .D.The De Minimis Exemption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .E.Scope of the Commission's Authority Over the Universal Service SupportMechanisms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .F.Basis for Assessing Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .G.Administrator of the Support Mechanisms . . . . . . . . . . . . . . . . . . . . . . . . . . .H.Implementation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .772772775793801806842858867XIV. Final Regulatory Flexibility Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 870A.Need for and Objectives of This Report and Order and the Rules Adopted Herein.872B.Summary and Analysis of the Significant Issues Raised by Public Comments inResponse to IRFA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8743
Federal Communications CommissionC.D.E.XV.FCC 97-157Description and Estimates of the Number of Small Entities to Which the RulesAdopted in this Report and Order Will Apply . . . . . . . . . . . . . . . . . . . . . . . . 8901.Telephone Companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8942.Cable System Operators . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9173.Municipalities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9234.Rural Health Care Providers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9245.Schools and Libraries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 925Summary Analysis of the Projected Reporting, Recordkeeping, and OtherCompliance Requirements and Significant Alternatives and Steps Taken toMinimize the Significant Economic Impact on a Substantial Number of SmallEntities Consistent with Stated Objectives. . . . . . . . . . . . . . . . . . . . . . . . . . . . 926Report to Congress . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 983Conclusion. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 984XVI. Ordering Clauses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 985Appendix AAppendix BAppendix CAppendix DAppendix EAppendix F(Parties Filing Initial Comments)(Parties Filing Reply Comments)(Parties Filing Cost Proxy Model Comments)(Parties Filing Comments on Proxy Cost Model Workshops)(Parties Filing Proxy Cost Models)(Parties Cited in this Order that Filed Only in Response to the NPRM in CCDocket No. 96-45)Appendix G (Parties Filing Initial Comments: CPD File No. 97-2)Appendix H (Parties Filing Reply Comments: CPD File No. 97-2)Appendix I (Final Rules)Appendix J (Summary of Comments in CC Docket No. 96-45)Appendix K (Universal Service Proceeding February 1996 - May 1997)Appendix L (List of Universal Service Proceedings May 1997 - 2001)Appendix M (Future Proceedings)4
Federal Communications CommissionI.FCC 97-157INTRODUCTION1.In the Telecommunications Act of 1996 (1996 Act),1 Congress directed theCommission and states to take the steps necessary to establish support mechanisms to ensure thedelivery of affordable telecommunications service to all Americans, including low-incomeconsumers, eligible schools and libraries, and rural health care providers. Specifically, Congressdirected the Commission and the states to devise methods to ensure that "[c]onsumers in allregions of the Nation, including low-income consumers and those in rural, insular, and high costareas . . . have access to telecommunications and information services . . . at rates that arereasonably comparable to rates charged for similar services in urban areas."2 Congress furtherdirected the Commission to define additional services for support for eligible schools, libraries,and health care providers, and directed the Commission to "establish competitively neutral rules. . . to enhance, to the extent technically feasible and economically reasonable, access toadvanced telecommunications and information services for all public and non-profit elementaryand secondary school classrooms, health care providers, and libraries."32.This Order sets forth a plan that satisfies all of the statutory requirements, andputs in place a universal service support system that will be sustainable in an increasinglycompetitive marketplace. Consistent with the explicit statutory principles, our immediateimplementation of section 254 is shaped by our commitment to achieve four critical goals. First,we must implement all of the universal service objectives established by the Act, including thosefor low-income individuals, consumers in rural, insular, and high cost areas, schools, libraries,and rural health care providers.4 Second, we must maintain rates for basic residential service ataffordable levels. We believe that the rates for this service are generally at affordable levelstoday. Third, we must ensure affordable basic service continues to be available to all usersthrough an explicit universal service funding mechanism. For the present, we believe we canachieve this goal by maintaining our existing high cost mechanism at current funding levels,picking a platform mechanism by December 1997, and implementing a forward-looking1Pub. L. No. 104-104, 110 Stat. 56. The 1996 Act amends the Communications Act of 1934, 47 U.S.C. §§151 et seq. (Act). Hereinafter, all citations to the Act and to the 1996 Act will be to the relevant section of theUnited States Code unless otherwise noted.247 U.S.C. § 254(b)(3).347 U.S.C. § 254(h)(2)(A). Telecommunications carriers are required to provide service to rural health careproviders "at rates that are reasonably comparable to rates charged for similar services in urban areas." 47 U.S.C.§ 254(h)(1)(A). Schools and libraries now are entitled under federal law to service "at rates less than the amountscharged for similar services to other parties." 47 U.S.C. § 254(h)(1)(B). In addition, Congress directed theCommission to "enhance . . . access to advanced telecommunications and information services for all public andnon-profit elementary and secondary school classrooms, health care providers, and libraries." 47 U.S.C.§ 254(h)(2).4See, e.g., 47 U.S.C. §§ 254(b), (h), and (i).5
Federal Communications CommissionFCC 97-157economic cost mechanism for universal service for non-rural carriers starting January 1, 1999.Fourth, we must bring the benefits of competition to as many consumers as possible. Toimplement this goal, we must, in our access charge reform proceeding, address the implicitsubsidies in interstate access charges.3.Today, we adopt rules that reflect virtually all of the Joint Board'srecommendations5 and fulfill the universal service goals established by Congress. We recognize,however, that future developments in the competitive telecommunications marketplace and thenecessary actions of the states may warrant further Commission action to ensure that we createsustainable and harmonious federal and state methods of continuously fulfilling universal servicegoals. Therefore, we will seek additional fact-finding and deliberation by the Joint Board, andfurther coordination with individual state commissions, during approximately the next fifteenmonths. With the benefit of further specific recommendations from the Joint Board, specificallyon the implementation of support for rural, insular, and high cost areas, this Commission will actnot later than August 1998. By adopting in large measure the recommendations of the FederalState Joint Board and referring several issues to the Joint Board for further review, we commitourselves to working in close partnership with the states to create complimentary federal andstate universal service support mechanisms.4.This proceeding is part of a trilogy of actions that are focused on achievingCongress's goal of establishing a "pro-competitive, de-regulatory national policy frameworkdesigned to accelerate rapidly private sector deployment of advanced telecommunications andinformation technologies and services to all Americans by opening up all telecommunicationsmarkets to competition."6 The other components of the trilogy are the local competition7 andaccess reform rulemakings.8 Pursuant to the mandate of the 1996 Act, these three proceedings5See Federal-State Joint Board on Universal Service, CC Docket No. 96-45, Recommended Decision, 12 FCCRcd 87 (1996).6Joint Explanatory Statement at 1.7Implementation of the Local Competition Provisions of the Telecommunications Act of 1996, CC DocketNo. 96-98, First Report and Order, 11 FCC Rcd 15499 (1996) (Local Competition Order) stayed in part pendingjudicial review sub nom. Iowa Utils. Bd. v. FCC, 109 F.3rd 418 (8th Cir. 1996). See also Implementation of theLocal Competition Provisions of the Telecommunications Act of 1996, Interconnection Between Local ExchangeCarriers and Commercial Mobile Radio Service Providers, Area Code Relief Plan for Dallas and Houston Orderedby the Public Utilities Commission of Texas, and Administration of the North American Numbering Plan, SecondReport and Order, and Memorandum Opinion and Order, 11 FCC Rcd 19392 (Local Competition Second Reportand Order).8Access Charge Reform, Price Cap Performance Review for Local Exchange Carriers, Transport RateStructure and Pricing and End User Common Line Charges, CC Docket Nos. 96-262, 94-1, 91-213, and 95-72,Notice of Proposed Rulemaking,Third Report and Other and Notice of Inquiry, 62 Fed. Reg. 4,670 (rel. Dec. 24,1996) (Access Reform NPRM); First Report and Order, FCC 97-158 (adopted May 7, 1997) (Access Charge6
Federal Communications CommissionFCC 97-157are collectively intended to encourage the development of competition in all telecommunicationsmarkets.5.In the Local Competition Order,9 we set forth rules to implement sections 251 and252 of the Communications Act. As with all of Part II of Title II of the Communications Act,those sections, and the rules implementing them, seek to remove the legal, regulatory, economic,and operational barriers to local telecommunications competition. Sections 251 and 252 provideentrants with the opportunity to compete for consumers in local markets by either constructingnew facilities, purchasing access to unbundled network elements, or reselling telecommunicationservices.6.Through this Order and our accompanying Access Charge Reform Order, weestablish the definition of services to be supported by federal universal service supportmechanisms and the specific timetable for implementation. We set in place rules that willidentify and convert existing federal universal service support in the interstate high cost fund, thedial equi
Federal Communications Commission FCC 97-157 1 Corrected Version Before the FEDERAL COMMUNICATIONS COMMISSION Washington, D.C. 20554 In the Matter of )) Federal-State Joint Board on ) CC Docket No. 96-45 Universal Service ) REPORT AND ORDER Adopted: May 7, 1997 Released: May 8, 1997
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Federal Communications Commission FCC 22-37 5 7. The Commission and Congress have long acknowledged that illegal robocalls that originate abroad are a significant part of the robocall problem.11 Congress highlighted this problem in 2018 when it passed RAY BAUM'S Act, which prohibits spoofing calls or texts originating outside the
Truth-in-Billing and Billing Format Federal Communications Commission Before the FEDERAL COMMUNICATIONS COMMISSION Washington, D.C. 20554 ) ) ) ) ) CC Docket No. 98-170 FIRST REPORT AND ORDER AND FURTHER NOTICE OF PROPOSED RULEMAKING Adopted: April 15, 1999 Released: May 11, 1999 FCC 99-72
Federal Communications Commission FCC 22-2 5 election notice requirements for the end of the EBB Program.19 The Bureau also provided guidance to help consumers, participating service providers, program partners and other stakeholders prepare for the 22).). 22 FCC
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