[Federal Register Volume 69, Number 119 (Tuesday, June 22, 2004)]
[Proposed Rules]
[Pages 34629-34631]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-13997]


=======================================================================
-----------------------------------------------------------------------

FEDERAL COMMUNICATIONS COMMISSION

47 CFR Parts 36 and 54

[WC Docket No. 03-109; FCC 04-87]


Lifeline and Link-Up

AGENCY: Federal Communications Commission.

ACTION: Proposed rule.

-----------------------------------------------------------------------

SUMMARY: In this document, the Commission seeks comment on whether the 
inclusion of a broader income-based criterion in the federal default 
eligibility criteria would further increase Lifeline/Link-Up 
subscription rates. The actions the Commission takes will result in a 
more inclusive and robust Lifeline/Link-Up program, consistent with the 
statutory goals of maintaining affordability and access of low-income 
consumers to supported services, while ensuring that support is used 
for its intended purpose.

DATES: Comments are due on or before August 23, 2004. Reply comments 
are due on or before October 5, 2004.

ADDRESSES: All filings must be sent to the Commission's Secretary, 
Marlene H. Dortch, Office of the Secretary, Federal Communications 
Commission, 445 12th Street, SW., Washington, DC 20554. See 
SUPPLEMENTARY INFORMATION for further filing instructions.

FOR FURTHER INFORMATION CONTACT: Shannon Lipp, Attorney, and Karen 
Franklin, Attorney, Wireline Competition Bureau, Telecommunications 
Access Policy, (202) 418-7400.

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's 
Further Notice of Proposed Rulemaking in WC Docket No. 03-109, FCC 04-
87, released on April 29, 2004. A companion Report and Order was also 
released in WC Docket No. 03-109, FCC 04-87 on April 29, 1004. The full 
text of this document is available for public inspection during regular 
business hours in the FCC Reference Center, Room CY-A257, 445 12th 
Street, SW., Washington, DC 20554.

I. Introduction

    1. In this Further Notice of Proposed Rulemaking, we seek comment 
on whether the inclusion of a broader income-based criterion in the 
federal default eligibility criteria would further increase Lifeline/
Link-Up subscription rates. The actions we take will result in a more 
inclusive and robust Lifeline/Link-Up program, consistent with the 
statutory goals of maintaining affordability and access of low-income 
consumers to supported services, while ensuring that support is used 
for its intended purpose.

II. Further Notice of Proposed Rulemaking

A. Income-based Criterion

    2. We seek comment on whether the income-based criterion in the 
federal default eligibility criteria should be increased to 150% of the 
Federal Poverty Guidelines (FPG) to make phone service affordable to 
more low-income individuals and families. Although most commenters 
supported adding an income-based criterion, a number of those 
commenters supported a higher income-based standard than the interim 
measure that we adopt. Specifically, those commenters preferred that a 
consumer whose household income is at or below 150% of the FPG should 
be eligible for Lifeline/Link-Up support. Commenters argue that adding 
a higher FPG level would bring Lifeline/Link-Up support in line with 
Low Income Home Energy Assistance Program (LIHEAP), a current 
qualifying Lifeline/Link-Up program that uses an income-based standard 
of 150% as an eligibility criterion. Commenters also point out the 
inequity that currently exists between a hypothetical low-income 
consumer who does not participate in LIHEAP and therefore does not 
qualify for Lifeline, and another hypothetical low-income consumer with 
the same income who participates in LIHEAP and Lifeline. In particular, 
low-income consumers are not eligible for LIHEAP if they rent a house 
or apartment with utilities included, yet they may have essentially the 
same income as consumers who pay for utilities separately. It is 
possible that a non-trivial number of low-income consumers may fall 
into this category. Furthermore, adding a higher FPG level may also 
help to increase participation among low-income consumers who do not 
currently qualify for Lifeline/Link-Up because they are on waiting 
lists for Section 8 housing, are not eligible for Supplemental Security 
Income (SSI) because they are not elderly or disabled, have been cut 
off from Food Stamps because of work requirements, or do not qualify 
for Medicaid due to complex eligibility requirements. Adding a higher 
FPG level could also help respond to the decrease in participation 
rates prevalent in at least one current Lifeline/Link-Up qualifying 
program and one adopted in this Order, Food Stamps and Temporary 
Assistance for Needy Families (TANF), respectively.
    3. Applying the same methodology used to analyze the 135% of the 
FPG

[[Page 34630]]

income-based criterion, our staff analysis estimates that broadening 
the income-based criterion to 150% of the FPG may only have a minimal 
impact on national telephone penetration rates, but could add many new 
Lifeline subscribers; potentially resulting in an additional $200 
million increase in Lifeline expenditures over the levels predicted for 
implementation of a 135% standard. We seek comment on this analysis. 
Commenters should discuss the staff analysis contained in Appendix K 
(see full document), the advantages and disadvantages of a broader 
income-based standard and the potential burden to the fund. When 
considering their response, commenters should refer to Appendix F (see 
full document) for estimated income requirements for various sizes of 
households at or below 150% of the FPG.

B. Lifeline Advertising Requirements

    4. Although we adopt the Joint Board's recommendation to issue 
outreach guidelines, rather than specific requirements, on further 
reflection, we think it would be beneficial to explore whether adoption 
of rules governing the advertisement of the Lifeline/Link-Up program 
would strengthen the operation of these programs. For instance, we seek 
comment on whether the Commission should require eligible 
telecommunication carriers (ETCs) to print and distribute posters, 
flyers, or other print media advertising Lifeline/Link-Up to State, 
Federal, or tribal public assistance agencies in their service areas. 
If a percentage of the population in a given area speaks a language 
other than English, should ETCs be required to distribute materials in 
that language? If so, what should the benchmark percentage be?

III. Procedural Matters

A. Regulatory Flexibility Analysis

    5. As required by the Regulatory Flexibility Act of 1980, as 
amended (RFA), the Commission has prepared the present Initial 
Regulatory Flexibility Analysis (IRFA) of the possible significant 
economic impact on a substantial number of small entities by the 
policies and rules proposed in this FNPRM. 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 FNPRM. The 
Commission will send a copy of the FNPRM, including this IRFA, to the 
Chief Counsel for Advocacy of the Small Business Administration. In 
addition, the FNPRM and IRFA (or summaries thereof) will be published 
in the Federal Register.

B. Need for, and Objectives of, the Proposed Rules

    6. The Commission is required by section 254 of the Act to 
promulgate rules to implement the universal service provisions of 
section 254. On May 8, 1997, the Commission released an Order, 62 FR 
32862, June 17, 1997, that adopted rules that reformed its system of 
universal service support mechanisms so that universal service is 
preserved and advanced as markets move toward competition. Among other 
things, the Commission adopted a mechanism to provide discounted 
monthly telephone service and installation charges to low-income 
households. Over the last few years, important changes in the low-
income community and the Joint Board's Recommended Decision prompt us 
to review the low-income universal service support mechanism.
    7. In this FNPRM, we seek comment on whether the income-based 
criterion in the federal default eligibility criteria should be 
increased to 150% of the FPG to make phone service more affordable to 
more low-income individuals and families. Applying the same methodology 
used to analyze the 135% of the FPG income-based criterion, the 
Commission staff analysis estimates that broadening the income-based 
criterion to 150% of the FPG may only have a minimal impact on national 
telephone penetration rates, but could add many new Lifeline 
subscribers. Therefore, we seek comment on whether a broader income-
based criterion should be added even when there could be only a minimal 
impact to the national telephone penetration rate.

C. Legal Basis

    8. This FNPRM is adopted pursuant to sections 1, 4(i), (4j), 201-
205, 251, 252, and 303 of the Communications Act of 1934, as amended, 
47 U.S.C. 151, 154(i), (j), 201-205, 251, 252, and 303.

D. Description and Estimate of the Number of Small Entities To Which 
Rules Will Apply

    9. 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 rules adopted herein. The RFA generally defines the 
term ``small entity'' as having the same meaning as the terms ``small 
business,'' ``small organization,'' and ``small governmental 
jurisdiction.'' In addition, the term ``small business'' has the same 
meaning as the term ``small business concern'' under the Small Business 
Act, unless the Commission has developed one or more definitions that 
are appropriate to its activities. Under the Small Business Act, a 
``small business concern'' is one that: (1) Is independently owned and 
operated; (2) is not dominant in its field of operation; and (3) meets 
any additional criteria established by the Small Business 
Administration (SBA).
    10. We have described in detail, supra, in the FRFA, the categories 
of entities that may be directly affected by any rules or proposals 
adopted in our efforts to reform the universal service low-income 
support mechanism. For this IRFA, we hereby incorporate those entity 
descriptions by reference.

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

    11. The FNPRM seeks comment on potential changes to the Federal 
default income-based eligibility criterion for the low-income support 
mechanism. This potential change will not impact reporting or 
recordkeeping requirements; however, it could impact the overall pool 
of eligible applicants.

F. Steps Taken 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 
impacting small business, which may include the following four 
alternatives (among others): (1) the establishment of differing 
compliance and 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 part thereof, for small entities.
    13. In this FNPRM, we seek comment on whether the Commission should 
adopt a broader income-based criterion. If a broader income-based 
criterion is adopted, this could change the size of the overall pool of 
eligible applicants for universal service support for low-income 
subscribers.

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

    14. None.

H. Filing Procedures

    15. Pursuant to Sec. Sec.  1.415 and 1.419 of the Commission's 
rules, interested

[[Page 34631]]

parties may file comments are due on or before August 23, 2004. Reply 
comments are due on or before October 5, 2004. In order to facilitate 
review of comments and reply comments, parties should include the name 
of the filing party and the date of the filing on all pleadings. 
Comments may be filed using the Commission's Electronic Comment Filing 
System (ECFS) or by filing paper copies.
    16. Comments filed through the ECFS can be sent as an electronic 
file via the Internet to http://www.fcc.gov/cgb/ecfs. Generally, only 
one copy of an electronic submission must be filed. In completing the 
transmittal screen, commenters should include their full name, U.S. 
Postal Service mailing address, and the applicable docket or rulemaking 
number. Parties may also submit an electronic comment by Internet e-
mail. To get filing instructions for e-mail comments, commenters should 
send an e-mail to [email protected], and should include the following words 
in the body of the message, ``get form.'' A sample form and directions 
will be sent in reply. Or you may obtain a copy of the ASCII Electronic 
Transmittal Form (FORM-ET) at http://www.fcc.gov/e-file/email.html.
    17. Parties that choose to file by paper must file an original and 
four copies of each filing. Filings can be sent by hand or messenger 
delivery, by commercial overnight courier, or by first-class or 
overnight U.S. Postal Service mail (although we continue to experience 
delays in receiving U.S. Postal Service mail). The Commission's 
contractor, Natek, Inc., will receive hand-delivered or messenger-
delivered paper filings for the Commission's Secretary at a new 
location in downtown Washington, DC. The address is 236 Massachusetts 
Avenue, NE., Suite 110, Washington, DC 20002. The filing hours at this 
location will be 8 a.m. to 7 p.m. All hand deliveries must be held 
together with rubber bands or fasteners. Any envelopes must be disposed 
of before entering the building.
    18. Commercial overnight mail (other than U.S. Postal Service 
Express Mail and Priority Mail) must be sent to 9300 East Hampton 
Drive, Capitol Heights, MD 20743. U.S. Postal Service first-class mail, 
Express Mail, and Priority Mail should be addressed to 445 12th Street, 
SW., Washington, DC 20554. All filings must be addressed to the 
Commission's Secretary, Office of the Secretary, Federal Communications 
Commission.

------------------------------------------------------------------------
    If you are sending this type of
document or  using this delivery method     It should be addressed for
                 . . .                          delivery to . . .
------------------------------------------------------------------------
Hand-delivered or messenger-delivered    236 Massachusetts Avenue, NE.,
 paper filings for the Commission's       Suite 110, Washington, DC
 Secretary.                               20002 (8 a.m. to 7 p.m.)
Other messenger-delivered documents,     9300 East Hampton Drive,
 including documents sent by overnight    Capitol Heights, MD 20743 (8
 mail (other than United States Postal    a.m. to 5:30 p.m.)
 Service Express Mail and Priority
 Mail).
United States Postal Service first-      445 12th Street, SW.,
 class mail, Express Mail, and Priority   Washington, DC 20554.
 Mail.
------------------------------------------------------------------------

    19. Parties who choose to file by paper should also submit their 
comments on diskette. These diskettes, plus one paper copy, should be 
submitted to: Sheryl Todd, Telecommunications Access Policy Division, 
Wireline Competition Bureau, Federal Communications, at the filing 
window at 236 Massachusetts Avenue, NE., Suite 110, Washington, DC 
20002. Such a submission should be on a 3.5-inch diskette formatted in 
an IBM compatible format using Word or compatible software. The 
diskette should be accompanied by a cover letter and should be 
submitted in ``read only'' mode. The diskette should be clearly labeled 
with the commenter's name, proceeding (including the docket number, in 
this case WC Docket No. 03-109, type of pleading (comment or reply 
comment), date of submission, and the name of the electronic file on 
the diskette. The label should also include the following phrase ``Disk 
Copy--Not an Original.'' Each diskette should contain only one party's 
pleadings, preferably in a single electronic file. In addition, 
commenters must send diskette copies to the Commission's copy 
contractor, Best Copy and Printing, Inc., Portals II, 445 12th Street, 
SW., Room CYB402, Washington, DC 20554 (see alternative addresses for 
delivery by hand or messenger).
    20. Regardless of whether parties choose to file electronically or 
by paper, parties should also file one copy of any documents filed in 
this docket with the Commission's copy contractor, Best Copy and 
Printing, Inc., Portals II, 445 12th Street, SW., CY-B402, Washington, 
DC 20554 (see alternative addresses for delivery by hand or messenger) 
(telephone 800-378-3160) or via Web site http://www.BCPIWEB.com.
    21. The full text of this document is available for public 
inspection and copying during regular business hours at the FCC 
Reference Information Center, Portals II, 445 12th Street, SW., Room 
CY-A257, Washington, DC 20554. This document may also be purchased from 
the Commission's duplicating contractor, Best Copy and Printing, Inc., 
Portals II, 445 12th Street, SW., Room CY-B402, Washington, DC 20554, 
telephone (800) 378-3160, or via Web site http://www.BCPIWEB.com.

I. Further Information

    22. Alternative formats (computer diskette, large print, audio 
recording, and Braille) are available to persons with disabilities by 
contacting Brian Millin at (202) 418-7426 voice, (202) 418-7365 TTY, or 
[email protected]. This FNPRM can also be downloaded in Microsoft Word 
and ASCII formats at http://www.fcc.gov/wcb/universal_service/lowincome.html.

IV. Ordering Clauses

    23. Pursuant to the authority contained in sections 1, 4(i), 201-
205, 214, 254, and 403 of the Communications Act of 1934, as amended, 
this Further Notice of Proposed Rulemaking is adopted.

List of Subjects

47 CFR Part 36

    Communications common carrier, Reporting and recordkeeping 
requirements, Telephone.

47 CFR Part 54

    Communications common carriers, Reporting and recordkeeping 
requirements, Telecommunications, Telephone.

Federal Communications Commission.
Marlene H. Dortch,
Secretary.
[FR Doc. 04-13997 Filed 6-21-04; 8:45 am]
BILLING CODE 6712-01-P