[Federal Register Volume 66, Number 131 (Monday, July 9, 2001)]
[Proposed Rules]
[Pages 35765-35767]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-17032]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR PART 64

[CC Docket No. 98-67; DA 00-2739]


Interstate Telecommunication Relay Service (TRS) Fund Advisory 
Council and TRS Fund Administrator's Recommended TRS Cost Recovery 
Guidelines

AGENCY: Federal Communications Commission.

ACTION: Proposed rule.

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SUMMARY: On December 6, 2000, the Commission released a document 
seeking comment on the cost recovery guidelines recommended by the 
Interstate Telecommunications Relay Service (TRS) Fund Advisory Council 
and the TRS Fund Administrator (Advisory Council and Fund 
Administrator, respectively).

DATES: Comments due July 30, 2001. Reply comments due August 6, 2001.

FOR FURTHER INFORMATION CONTACT: Pam Slipakoff at (202) 418-7705 or 
[email protected] of the Common Carrier Bureau, Network Services 
Division. The address is: Network Services Division, Common Carrier 
Bureau, Federal Communications Commission, The Portals II, 445 12th 
Street, SW., Suite 6A207, Washington, DC 20554. The fax number is: 
(202) 418-2345. The TTY number is: (202) 418-0484.

SUPPLEMENTARY INFORMATION: In the March 6, 2000 Improved TRS Order, 65 
FR 38432 (June 21, 2000), the Commission amended the TRS rules to 
expand the kinds of relay services available to consumers and to 
improve the quality of TRS. The Commission also required the Advisory 
Council and the Fund Administrator to recommend a cost methodology to 
cover the additional requirements. In their recommendations, the 
Advisory Council and the Fund Administrator propose, among other 
things, applying the traditional TRS cost recovery model to each 
service, but capturing minutes of use and costs separately and 
establishing separate reimbursement rates.
    On November 9, 2000 the Advisory Council and the Fund Administrator 
filed their recommended TRS cost recovery guidelines as required by the 
Improved TRS Order. Those recommendations propose methodologies for 
recovering costs associated with the provision of traditional 
Telecommunications Relay Service (TRS), Speech-to-Speech (STS) Service, 
and Video Relay Service (VRS). These recommendations were placed on 
public notice on December 6, 2000. Comments were initially due on 
January 5, 2001 and reply comments were due on January 19, 2001. We now 
seek additional comment on these recommendations.
    The Advisory Council and Fund Administrator's Recommended TRS Cost 
Recovery Guidelines will be available for review and copying during 
regular business hours at the FCC Reference Center, Portals II, 445 
12th Street, SW, Room CY-A257, Washington, DC 20554, (202) 418-0270. It 
may also be viewed at https://haifoss.fcc.gov/cgibin.ws.exe/prod/ecfs/comsrch_v2.hts, by typing 98-67 in the proceeding box and 11/09/2000 in 
the date box. The recommended guidelines may also be purchased from the 
Commission's copy contractor, International Transcription Service, Inc. 
(ITS), 1231 20th Street, NW., Washington, DC 20036, telephone 202-857-
3800, facsimile 202-857-3805, TTY 202-293-8810.

Initial Regulatory Flexibility Analysis

    1. As required by the Regulatory Flexibility Act (RFA), the 
Commission has prepared this present Initial Regulatory Flexibility 
Analysis (IRFA) of the possible significant economic impact on small 
entities by the policies and rules in this document. Written public 
comments are requested on this IRFA. Comments must be identified as 
responses to the IRFA and must be filed by the deadlines for comments 
on the document. The Commission will send a copy of the document 
including this IRFA, to the Chief Counsel for Advocacy of the Small 
Business Administration. See 5 U.S.C. 603(a). In addition, the document 
and IRFA (or summaries thereof) will be published in the Federal 
Register. See id.

A. Need for, and Objective of, the Proposed Rules

    2. The Commission is issuing this document to seek comment on the 
recommended TRS cost recovery guidelines filed by the Advisory Council 
and the Fund Administrator on

[[Page 35766]]

November 9, 2000. For traditional TRS cost recovery, the Advisory 
Council and the Fund Administrator recommended that the Commission: (1) 
Continue to use the current national average costing and pricing 
methodology for the annual development of the interstate cost recovery 
reimbursement rate; (2) review the TRS Center Data Request to ensure 
that various sections and categories continue to be appropriate and up 
to date; (3) use the same allocation methodology in place today for 
allocating toll-free and 900 call minutes between interstate and 
intrastate demand; and (4) direct that Spanish relay costs be collected 
separately to test whether they are significantly different from 
English relay costs, and continue to reimburse providers on completed 
conversation minutes at a single national average reimbursement rate if 
there is no difference between the Spanish and English relay per-minute 
costs.
    3. The Advisory Council and the Fund Administrator make the 
following recommendations for STS cost recovery: (1) The same cost 
recovery methodology used for computing the reimbursement rate in place 
today for traditional TRS interstate cost recovery could be used to 
develop the STS reimbursement rate; (2) due to its unique 
characteristics, a separate reimbursement rate based on STS costs and 
minutes should be calculated; (3) the TRS Center Data Request should be 
expanded to include specific STS sections to capture the costs and 
minutes separately from traditional TRS or VRS; and (4) providers 
should be reimbursed for completed conversation minutes at the national 
average reimbursement rate for STS.
    4. The Advisory Council and the Fund Administrator make the 
following four recommendations with respect to VRS cost recovery: (1) 
The same methodology for rate development in place today for 
traditional TRS interstate cost recovery could be used to develop the 
VRS reimbursement rate; (2) providers should be reimbursed based on 
completed conversation minutes at a national average reimbursement 
rate; (3) the TRS Center Data Request should be expanded to include 
specific VRS sections to capture VRS costs and demand separately; and 
(4) due to its unique characteristics, a separate reimbursement rate 
based on VRS costs and demand should be calculated.

B. Legal Basis

    5. The authority for actions proposed in this document may be found 
in Secs. 64.603, and 64.604 of the Commission's Rules, 47 CFR 64.603, 
64.604, and in sections 1, 2, 4, 225, 255, and 303(r) of the 
Communications Act of 1934, as amended, 47 U.S.C. 151, 152, 154, 225, 
255, 303(r).

C. Description and Estimate of the Number of Small Entities to Which 
the Proposed Rules Will Apply

    6. The RFA directs agencies to provide a description of and, where 
feasible, an estimate of the number of small entities that may be 
affected by the proposed rules, if adopted. See 5 U.S.C. 603(b)(3). The 
RFA defines the term ``small entity'' as having the same meaning as the 
terms ``small business,'' ``small organization,'' and ``small 
governmental jurisdiction.'' See 5 U.S.C. 601(6). In addition, the term 
``small business'' has the same meaning as the term ``small business 
concern'' under the Small Business Act. See 5 U.S.C. 601(3) 
(incorporating by reference the definition of ``small business 
concern'' in 15 U.S.C. 632). Pursuant to the RFA, the statutory 
definition of a small business applies ``unless an agency, after 
consultation with the Office of Advocacy of the Small Business 
Administration and after opportunity for public comment, establishes 
one or more definitions of such term which are appropriate to the 
activities of the agency and publishes such definition(s) in the 
Federal Register.'' 5 U.S.C. 601(3). A small business concern is one 
which: (1) Is independently owned and operated; (2) is not dominant in 
its field of operation; and (3) satisfies any additional criteria 
established by the Small Business Administration (SBA). See Small 
Business Act, 15 U.S.C. 632 (1996). A small organization is generally 
``any not-for-profit enterprise which is independently owned and 
operated and is not dominant in its field.'' See 5 U.S.C. 601(4). 
Nationwide, as of 1992, there were approximately 275,801 small 
organizations. See 1992 Economic Census, U.S. Bureau of the Census, 
Table 6 (special tabulation of data under contract to Office of 
Advocacy of the U.S. Small Business Administration). ``Small 
governmental jurisdiction'' See 47 CFR 1.1162 generally means 
``governments of cities, counties, towns, townships, villages, school 
districts, or special districts, with a population of less than 
50,000.'' See 5 U.S.C. 601(5). As of 1992, there were approximately 
85,006 governmental entities in the United States. See U.S. Dept. of 
Commerce, Bureau of the Census, ``1992 Census of Governments.'' This 
number includes 38,978 counties, cities, and towns; of these, 37,566, 
or 96%, have populations of fewer than 50,000. See id. The Census 
Bureau estimates that this ratio is approximately accurate for all 
governmental entities. Thus, of the 85,006 governmental entities, we 
estimate that 81,600 (96%) are small entities. Below, we further 
describe and estimate the number of small entity licensees and 
regulatees that may be affected by these rules.
    7. The most reliable source of information regarding the total 
numbers of certain common carrier and related providers nationwide, as 
well as the numbers of commercial wireless entities, appears to be data 
the Commission publishes annually in its Telecommunications Industry 
Revenue report, regarding TRS.
    8. TRS Providers. Neither the Commission nor the SBA has developed 
a definition of ``small entity'' specifically applicable to providers 
of telecommunications relay services (TRS). The closest applicable 
definition under the SBA rules is for telephone communications 
companies other than radiotelephone (wireless) companies. The SBA 
defines such establishments to be small businesses when they have no 
more than 1,500 employees. According to the FCC's most recent data, 
there are 11 interstate TRS providers, which consist of interexchange 
carriers, local exchange carriers, state-managed entities, and non-
profit organizations. The FCC does not have data specifying the number 
of these providers that are either dominant in their field of 
operations, are not independently owned and operated, or have more than 
1,500 employees, and the FCC is thus unable at this time to estimate 
with greater precision the number of TRS providers that would qualify 
as small business concerns under the SBA's definition. The FCC notes, 
however, that these providers include several large interexchange 
carriers and incumbent local exchange carriers. Consequently, the FCC 
estimates that there are fewer than 11 small TRS providers that may be 
affected by the proposed rules, if adopted. The FCC seeks comment 
generally on its analysis identifying TRS providers, and specifically 
on whether the FCC should conclude that, for Regulatory Flexibility Act 
purposes, any of the TRS providers are in fact small entities.
    9. Wireline Carriers and Service Providers. The SBA has developed a 
definition of small entities for telephone communications companies 
except radiotelephone (wireless) companies. The Census Bureau reports 
that there were 2,321 such telephone companies in operation for at 
least one year at the end of 1992. According to the SBA's definition, a 
small business telephone company other than a radiotelephone company is 
one employing no more

[[Page 35767]]

than 1,500 persons. All but 26 of the 2,321 non-radiotelephone 
companies listed by the Census Bureau were reported to have fewer than 
1,000 employees. Thus, even if all 26 of those companies had more than 
1,500 employees, there would still be 2,295 non-radiotelephone 
companies that might qualify as small entities or small incumbent local 
exchange carriers (LECs). The FCC does not have data specifying the 
number of these carriers that are not independently owned and operated, 
and thus are unable at this time to estimate with greater precision the 
number of wireline carriers and service providers that would qualify as 
small business concerns under the SBA's definition. Consequently, the 
FCC estimates that fewer than 2,295 small telephone communications 
companies other than radiotelephone companies are small entities or 
small incumbent LECs.
    10. We have included small incumbent LECs in this present RFA 
analysis. As noted above, a ``small business'' under the RFA is one 
that, inter alia, meets the pertinent small business size standard 
(e.g., a telephone communications business having 1,500 or fewer 
employees), and ``is not dominant in its field of operation.'' See 5 
U.S.C. 601(3). The SBA's Office of Advocacy contends that, for RFA 
purposes, small incumbent LECs are not dominant in their field of 
operation because any such dominance is not ``national'' in scope. See 
Letter from Jere W. Glover, Chief Counsel for Advocacy, SBA, to William 
E. Kennard, Chairman, FCC (May 27, 1999). The Small Business Act 
contains a definition of ``small business concern,'' which the RFA 
incorporates into its own definition of ``small business.'' See 15 
U.S.C. 632(a) (Small Business Act); 5 U.S.C. 601(3) (RFA). SBA 
regulations interpret ``small business concern'' to include the concept 
of dominance on a national basis. 13 CFR 121.102(b). Since 1996, out of 
an abundance of caution, the Commission has included small incumbent 
LECs in its regulatory flexibility analyses. See, e.g., Implementation 
of the Local Competition Provisions of the Telecommunications Act of 
1996, CC Docket, 96-98, First Report and Order, 11 FCC Rcd 15499, 
16144-45 (1996). We have therefore included small incumbent LECs in 
this RFA analysis, although we emphasize that this RFA action has no 
effect on FCC analyses and determinations in other, non-RFA contexts.

D. Description of Projected Reporting, Recordkeeping, and Other 
Compliance Requirements

    11. The recommended guidelines may require TRS providers to track 
Spanish and English relay costs separately to see if there are 
significant differences between the two services. There may also be 
additional recordkeeping requirements imposed for STS and VRS cost 
recovery because these are relatively new services. These costs, 
however, should be minimal because the tracking procedures are similar 
to those already in place for traditional TRS. The FCC tentatively 
concludes that the proposals in the document would impose minimum 
burdens on small entities. In addition, these recordkeeping measures 
will promote more efficient service and allow the TRS providers to be 
reimbursed more accurately for their costs, thus negating any minimal 
costs imposed by these requirements. Furthermore, we do not expect 
these costs to burden small entities any more than large entities 
because the costs are part of the reimbursement process and will allow 
all providers to be accurately reimbursed. The FCC seeks comment on 
these tentative conclusions.

E. Steps Take To Minimize Significant Economic Impact on Small 
Entities, and Significant Alternatives Considered

    12. The RFA requires an agency to describe any significant 
alternatives that it has considered in reaching its proposed approach, 
which may include the following four alternatives (among others): (1) 
The establishment of differing compliance or reporting requirements or 
timetables that take into account the resources available to small 
entities; (2) the clarification, consolidation, or simplification of 
compliance or reporting requirements under the rule for small entities; 
(3) the use of performance, rather than design, standards; and (4) an 
exemption from coverage of the rule, or any part thereof, for small 
entities. 5 U.S.C. 603(c). The Commission has tentatively concluded 
that the proposed rules will have minimal economic impact on small 
entities because these rules are designed to allow all providers to be 
accurately reimbursed. Furthermore, the Advisory Council consists of 
members of state regulatory bodies, relay users, members of the 
disabilities community, large and small TRS providers, and large and 
small TRS contributors. As a result, the proposed guidelines are the 
result of input from the industry, including small business entities.

F. Federal Rules That May Duplicate, Overlap, or Conflict With the 
Proposed Rules

    None.
Report to Congress
    13. The Commission will send a copy of this document, including a 
copy of this IRFA, in a report to Congress pursuant to the Small 
Business Regulatory Enforcement Fairness Act of 1996. In addition, the 
document and this IRFA will be sent to the Chief Counsel for Advocacy 
of the Small Business Administration, and will be published in the 
Federal Register.
Ordering Clauses
    16. The Commission's Consumer Information Bureau, Reference 
Information Center, SHALL SEND a copy of this Second Further Notice of 
Proposed Rulemaking, including the Initial Regulatory Flexibility 
Analysis, to the Chief Counsel for Advocacy of Small Business 
Administration.
    14. The Initial Regulatory Flexibility Analysis for this document, 
pursuant to the Regulatory Flexibility Act, 5 U.S.C. 604, is contained 
herein.

Federal Communications Commission.
Magalie Roman Salas,
Secretary.
[FR Doc. 01-17032 Filed 7-6-01; 8:45 am]
BILLING CODE 6712-01-U