[Federal Register Volume 77, Number 209 (Monday, October 29, 2012)]
[Proposed Rules]
[Pages 65526-65530]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-26553]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 64

[CG Docket Nos. 03-123 and 10-51; DA 12-1644]


Telecommunications Relay Services and Speech-to-Speech Services 
for Individuals With Hearing and Speech Disabilities; Structure and 
Practices of the Video Relay Service Program

AGENCY: Federal Communications Commission.

ACTION: Proposed rule.

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SUMMARY: In this document, the Commission seeks comment on matters 
related to access technology and enhanced database operations for video 
relay service (VRS) raised in recent filings submitted by CSDVRS, LLC, 
a VRS provider. In order for the Commission to be in a position to set 
new rates as it moves forward with the next phase of VRS reform, it 
also seeks comment on a proposal by the Fund administrator, Rolka Loube 
Saltzer Associates (RLSA), to modify VRS compensation rates.

DATES: Comments are due on or before November 14, 2012. Reply comments 
are due on or before November 29, 2012.

ADDRESSES: You may submit comments, identified by CG Docket Nos. 03-123 
and 10-51, by any of the following methods:
    [ssquf] Electronic Filers: Comments may be filed electronically 
using the Internet by accessing the Commission's Electronic Comment 
Filing System (ECFS), through the Commission's Web site: http://fjallfoss.fcc.gov/ecfs2/. Filers should follow the instructions 
provided on the Web site for submitting comments. For ECFS filers, in 
completing the transmittal screen, filers should include their full 
name, U.S. Postal service mailing address, and CG Docket Nos. 03-123 
and 10-51. Paper Filers: Parties who choose to file by paper must file 
an original and one copy of each filing. If more than one docket or 
rulemaking number appears in the caption of this proceeding, filers 
must submit two additional copies for each additional docket or 
rulemaking number. 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 the Commission continues to experience 
delays in receiving U.S. Postal Service mail). All filings must be 
addressed to the Commission's Secretary, Office of the Secretary, 
Federal Communications Commission.
    [ssquf] All hand-delivered or messenger-delivered paper filings for 
the Commission's Secretary must be delivered to FCC Headquarters at 445 
12th Street SW., Room TW-A325, Washington, DC 20554. The filing hours 
are 8:00 a.m. to 7:00 p.m. All hand deliveries must be held together 
with rubber bands or fasteners. Any envelopes and boxes must be 
disposed of before entering the building.
    [ssquf] 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.
    [ssquf] U.S. Postal Service first-class, Express, and Priority mail 
must be addressed to 445 12th Street SW., Washington DC 20554.
    [ssquf] In addition, parties must serve one copy of each pleading 
with the Commission's duplicating contractor, Best Copy and Printing, 
Inc., 445 12th Street SW., Room CY-B402, Washington, DC 20554, or via 
email to [email protected].
    For detailed instructions for submitting comments and additional 
information on the rulemaking process, see the SUPPLEMENTARY 
INFORMATION section of this document.

FOR FURTHER INFORMATION CONTACT: Gregory Hlibok, Consumer and 
Governmental Affairs Bureau, Disability Rights Office, at (202) 559-
5158 (voice/videophone), (202) 418-0431 (TTY), or email at 
[email protected], or

[[Page 65527]]

Robert Aldrich, Consumer and Governmental Affairs Bureau, at (202) 418-
0996 (voice), or email at [email protected].

SUPPLEMENTARY INFORMATION: This is a summary of the Bureau's 
Telecommunications Relay Services and Speech-to-Speech Services for 
Individuals with Hearing and Speech Disabilities; Structure and 
Practices of the Video Relay Service Program, Public Notice (VRS Reform 
and Rates Notice), document DA 12-1644, released October 15, 2012, in 
CG Docket Nos. 03-123 and 10-51, seeking comments on access 
technologies and compensation rates for VRS. The full text of the VRS 
Reform and Rates Notice and copies of any subsequently filed documents 
in this matter will be available for public inspection and during 
regular business hours at the FCC Reference Information Center, Portals 
II, 445 12th Street SW., Room CY-A257, Washington, DC 20554. They 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: (202) 488-5300, fax: (202) 488-5300, 
or Internet: www.bcpiweb.com. This document can also be downloaded in 
Word or Portable Document Format (``PDF'') at: http://www.fcc.gov/cgb/dro/trs.html. To request materials in accessible formats for people 
with disabilities (Braille, large print, electronic files, audio 
format), send an email to [email protected] or call the Consumer and 
Governmental Affairs Bureau at 202-418-0530 (voice), 202-418-0432 
(TTY). Pursuant to 47 CFR 1.1200 et. seq., this matter shall be treated 
as a ``permit-but-disclose'' proceeding in accordance with the 
Commission's ex parte rules. Persons making ex parte presentations must 
file a copy of any written presentation or a memorandum summarizing any 
oral presentation within two business days after the presentation 
(unless a different deadline applicable to the Sunshine period 
applies). Persons making oral ex parte presentations are reminded that 
memoranda summarizing the presentation must: (1) List all persons 
attending or otherwise participating in the meeting at which the ex 
parte presentation was made; and (2) summarize all data presented and 
arguments made during the presentation. If the presentation consisted 
in whole or in part of the presentation of data or arguments already 
reflected in the presenter's written comments, memoranda or other 
filings in the proceeding, the presenter may provide citations to such 
data or arguments in his or her prior comments, memoranda, or other 
filings (specifying the relevant page and/or paragraph numbers where 
such data or arguments can be found) in lieu of summarizing them in the 
memorandum. Documents shown or given to Commission staff during ex 
parte meetings are deemed to be written ex parte presentations and must 
be filed consistent with Sec.  1.1206(b) of the Commission's rules. In 
proceedings governed by Sec.  1.49(f) or for which the Commission has 
made available a method of electronic filing, written ex parte 
presentations and memoranda summarizing oral ex parte presentations, 
and all attachments thereto, must be filed through the electronic 
comment filing system available for that proceeding, and must be filed 
in their native format (e.g., .doc, .xml, .ppt, searchable .pdf). 
Participants in this proceeding should familiarize themselves with the 
Commission's ex parte rules.
    People with Disabilities: To request materials in accessible 
formats for people with disabilities (braille, large print, electronic 
files, audio format), send an email to [email protected] or call the 
Consumer and Governmental Affairs Bureau at 202-418-0530 (voice), 202-
418-0432 (TTY).

Initial Paperwork Reduction Act of 1995 Analysis

    Document DA 12-1644 does not contain proposed information 
collection requirements subject to the Paperwork Reduction Act of 1995, 
Public Law 104-13. In addition, therefore, it does not contain any 
proposed information collection burden for small business concerns with 
fewer than 25 employees, pursuant to the Small Business Paperwork 
Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4).

Synopsis

Background

    1. In June 2010, the Commission began a comprehensive review of the 
rates, structure, and practices of the VRS program. Structure and 
Practices of the Video Relay Service Program, Notice of Inquiry, (2010 
VRS NOI), CG Docket No. 10-51, published at 75 FR 41863, July 19, 2010. 
The Commission's goal in beginning that review, and ever since then, 
has been to reform the VRS program, which for many years had been beset 
by waste, fraud, and abuse and by compensation rates that had become 
inflated well above actual cost. Since that time, the Commission has 
acted to improve the program so that it can continue to provide a 
valuable service to deaf and hard-of-hearing consumers as efficiently 
as possible.
    2. The Commission's actions over the past two years have saved the 
program approximately $300 million to date. Most significantly, in June 
2010, at the same time the Commission issued the 2010 VRS NOI asking 
questions about potential fundamental changes to the VRS program, the 
Commission cut the compensation rate for the bulk of VRS traffic by 
more than $1.00 per minute, the first substantial VRS rate reduction in 
six years. Stressing its ``obligation to protect the integrity of the 
Fund and to deter and detect waste,'' the Commission stated that it 
would no longer tolerate ``the large discrepancy between actual costs 
and provider compensation'' that had resulted from earlier VRS 
ratesetting orders. Telecommunications Relay Services and Speech-to-
Speech Services for Individuals with Hearing and Speech Disabilities, 
Order, (2010 TRS Rate Order), CG Docket No. 03-123, published at 75 FR 
49491, August 13, 2010. See also Structure and Practices of the Video 
Relay Service Program; Telecommunications Relay Services and Speech-to-
Speech Services for Individuals with Hearing and Speech Disabilities, 
Notice of Proposed Rulemaking (2011 VRS Rate NPRM), CG Docket Nos. 03-
123 and 10-51, published at 76 FR 24442, May 2, 2011.
    3. The Commission has taken significant further steps to protect 
the VRS program's integrity and increase its efficiency since that 
time. In April 2011, the Commission adopted additional wide-ranging 
measures to improve oversight of and prevent fraud, waste, and abuse by 
VRS providers. The Commission required providers to submit detailed 
call records to justify their requests for compensation, instituted 
annual as well as unscheduled provider audits, banned providers from 
tying their employees' wages to the number of calls processed, and 
prohibited revenue-sharing arrangements between certificated, Fund-
eligible service providers and unregulated companies. In July 2011, the 
Commission tightened the eligibility and certification requirements for 
VRS providers to ensure that only providers operating in compliance 
with the Commission's rules would be permitted to provide this service 
to the public. And in December 2011, the Commission proposed additional 
substantial reforms to the VRS market structure and the practices of 
providers. Structure and Practices of the Video Relay Service Program; 
Telecommunications Relay Services and Speech-to-Speech Services for 
Individuals with Hearing and

[[Page 65528]]

Speech Disabilities, Further Notice of Proposed Rulemaking, (2011 VRS 
Reform FNPRM), CG Docket Nos. 10-51 and 03-123, published at 77 FR 
4948, February 1, 2012. These reforms were intended to ensure that the 
program continues to support services that offer functional equivalence 
to all eligible users and becomes as immune as possible from the waste, 
fraud, and abuse that could threaten its viability.
    4. Document DA 12-1644 is the next step in these ongoing reform 
efforts. CGB, on delegated authority, seeks comment on matters raised 
in recent filings submitted by CSDVRS, LLC, a VRS provider. Moreover, 
in order for the Commission to be in a position to set new rates as it 
moves forward with the next phase of VRS reform, the Bureau also seeks 
comment in document DA 12-1644 on a proposal by the Fund administrator, 
Rolka Loube Saltzer Associates (RLSA), to modify VRS compensation 
rates.

Additional Comment on Structural Reform Options

    5. As discussed in the 2010 VRS NOI, VRS communications require the 
interaction of three separate yet interlinked components: VRS access 
technologies, video communication service, and relay service provided 
by American Sign Language (ASL)-fluent communications assistants (CAs). 
The Bureau now seeks additional comment on specific proposals to 
disaggregate these components. The Bureau emphasizes that neither the 
Commission nor CGB has decided to adopt any of these proposals; CGB is 
simply seeking input to help develop a more complete record to enable 
the Commission to better evaluate the various issues in this 
proceeding.

VRS Access Technology

    6. As noted above, CSDVRS has submitted two structural reform 
proposals to the Commission. The first of these proposes that the 
Commission facilitate migration of all VRS access technologies to a 
standard, software based VRS access technology (``application'') that 
could be used on commonly available off-the-shelf hardware as a means 
of furthering the Commission's interoperability and portability goals. 
The Bureau seeks comment on this proposal, and seek particular comment 
on the following related questions:
    7. The Commission proposed to establish standards for iTRS Access 
Technology, including VRS Access Technology, in the 2011 VRS Reform 
FNPRM. Would the process for establishing and maintaining standards 
discussed in the 2011 VRS Reform FNPRM be appropriate for developing an 
application or establishing standards for an application? Should the 
application or key components thereof be open source?
    8. Should the Commission mandate use of a single application or 
allow development of multiple, interoperable applications? Who should 
be responsible for application development? For example, should the 
Commission develop, by contract, such an application? How should the 
developer of the application be compensated?
    9. Should providers be able to continue to offer their own 
internally developed applications? If so, under what conditions? For 
example, should there be an interoperability testing process? How would 
such an interoperability testing process be structured?
    10. Should the application be full executable, or a core executable 
or set of libraries (``core'') that can be customized by interested 
parties (e.g., using published APIs), or both? If core, what key 
functions should this core contain, such as video encoding, video 
decoding and session signaling? If core, should there be a 
certification process before calls placed with the application are 
compensable? How should that process be structured? Who should be 
responsible for maintaining and updating applications?
    11. What off-the-shelf hardware and operating system platforms 
should be supported? Should users be responsible for procuring their 
own off-the-shelf equipment, or should providers be involved in the 
acquisition and distribution of end user equipment to VRS users?
    12. How should consumers be involved in the development, selection, 
certification and on-going enhancement of either the core or the 
application?
    13. How would users obtain support for issues relating to the 
application or its use on their equipment (e.g., network firewall 
issues, troubleshooting problems)?
    14. What other approaches might be considered to select an 
application or applications for use in the VRS system? For example, 
should the Commission host a competition among existing VRS access 
applications and/or commercial standards-based off-the-shelf video 
conferencing applications? What would be the benefits and drawbacks of 
these or other alternate approaches?
    15. How would a transition to a VRS system that relies exclusively 
on a common application be accomplished, and over what period of time?
    16. What changes in the Commission's rules would be necessary to 
adopt this proposal or one of the alternatives described above?

Enhanced iTRS Database Operations

    17. CSDVRS also has proposed an industry structure in which all 
providers of ASL relay CA services would utilize an enhanced version of 
the TRS numbering directory to provide features such as user 
registration and validation, call routing, and usage accounting. In 
effect, this would separate the video communication service component 
of VRS from the ASL relay CA service component by providing the 
functions of the former from an enhanced database (``enhanced iTRS 
database''). The Bureau seeks comment on this proposal, and seek 
particular comment on the following related questions:
    18. What functions and services should the enhanced iTRS database 
provide? Some possibilities include:

 Development and distribution of VRS access technology, such as 
a common application
 User registration and validation (account and credential 
creation)
 Per-call user verification (authentication)
 TRS numbering directory functions
 Usage accounting
 Call routing
    [cir] To the user-chosen default or the per-call ASL relay CA 
service provider
    [cir] To/from other end users (i.e., point-to-point calls)
    [cir] To/from the PSTN
    [cir] 911 call processing
 Vertical features such as video mail and address book

    19. How would ASL relay CA service providers interface with the 
enhanced iTRS database? Would each ASL relay CA service provider be 
required to establish its own internal routing system for distributing 
calls among its call centers, or should the enhanced iTRS database 
allow providers to specify provider-internal call routing rules?
    20. CSDVRS' proposal appears to contemplate the existence of 
multiple video communication service providers. Is this necessary? How 
would the user or application choose among these providers? If the 
choice of the communication service provider is independent of the ASL 
relay CA service, based on what criteria or metrics would users or 
applications make that choice? Given that VRS providers currently 
compete primarily on quality of CA service, should the Commission 
contract for a single

[[Page 65529]]

provider of the enhanced iTRS database functions, including video 
communication service, that allows users to access the ASL relay CA 
service of their choice? If the Commission does choose to contract for 
these functions, should there be a single contract or multiple 
contracts?
    21. What changes in the Commission's rules would be necessary to 
implement such a structure?

Rate Proposals

    22. As noted above, in the 2010 TRS Rate Order, the Commission 
stated it would no longer tolerate the ``large discrepancy between 
actual costs and provider compensation'' that had resulted from earlier 
VRS ratesetting orders. Stressing its ``obligation to protect the 
integrity of the Fund and to deter and detect waste,'' the Commission 
also released the 2010 VRS NOI to consider, among other issues, ``the 
most appropriate way to calculate and set future [VRS] rates.'' 
Subsequently, in the 2011 VRS FNPRM, the Commission proposed that, if a 
per-minute VRS rate was retained, it should be set based on the 
weighted average of actual per-minute provider costs for the most 
recently completed fund year. These steps have made clear the 
Commission's determination to review rate issues as part of its VRS 
reform proceeding and to obtain VRS rates that better reflect actual 
expenses of VRS providers.
    23. Under Sec.  64.604(c)(5)(iii)(E) and (H) of the Commission's 
rules, the Fund administrator is required to file the Fund payment 
formulas and revenue requirements for VRS with the Commission on May 1 
of each year, to be effective the following July 1. However, on April 
30, 2012, the Bureau waived the Fund administrator's obligation to file 
proposed rates and revenue requirements for VRS for the 2012-13 Fund 
year by May 1, 2012. In its order adopting rates for the 2012-13 Fund 
year, the Bureau indicated that the current interim rates for VRS would 
remain in place pending the Commission's completion of the current 
proceeding on reforming the structure and practices in the VRS market. 
In anticipation of the completion of the VRS reform proceeding, or of 
the current phase thereof, the Commission requested the Fund 
administrator, RLSA, to submit proposed VRS rates for the remainder of 
the 2012-13 Fund year. In document DA 12-1644, the Bureau seeks comment 
on RLSA's proposed VRS compensation rates, as well as on alternative 
rate methodologies, for the remainder of the 2012-13 Fund year and 
subsequent years.
    24. The Bureau urges parties that disagree with RLSA's proposed 
rates to offer specific and detailed alternatives. Further, the Bureau 
expects parties to focus their comments, to the maximum extent 
practicable, on publicly available data and to make public the details 
of their views and arguments, including the specific dollar amounts 
that they believe the Commission should adopt for specific rates or 
cost elements.

RLSA's Rate Proposals

    25. In the 2012 VRS Rate Filing, RLSA presents a proposal for 
determining how VRS providers are to be compensated by the Fund. Based 
on its analysis of the cost and demand data received from providers, 
the Fund administrator states that VRS providers' weighted average 
actual per-minute costs were $3.5740 for 2010 and $3.1900 for 2011, and 
that VRS providers' weighted average projected per-minute costs are 
$3.4313 for 2012. RLSA proposes that rates be based on an average of 
these three numbers, with appropriate adjustments to reflect rate 
tiers. Using this proposed methodology, RLSA proposes that cost based 
rates be phased in over a multi-year time period, with the rates 
restructured in two tiers instead of the current three tiers. Based on 
a three-year phase-in, RLSA proposes that rates be set initially for 
Tiers I and II (up to 500,000 minutes each month) at $5.2877 per 
minute, and for Tier III (over 500,000 minutes each month) at $4.5099 
per minute. RLSA also presents data that reflects several of the 
categories of compensable and non-compensable costs. The Bureau invites 
comment on RLSA's proposed rate structure, proposed rates, and cost 
calculations, including its weighting of individual providers' costs. 
Commenters who advocate alternative rates to those proposed by RLSA are 
urged to discuss any resulting changes that will be necessary in the 
TRS revenue requirement and contribution factor if the rate(s) they 
advocate are adopted.

Open Ratemaking Issues

    26. The Commission's determination regarding VRS compensation for 
the remainder of the 2012-13 Fund year and subsequent years may be 
affected by how the Commission resolves various ratemaking issues 
raised in the 2011 VRS Reform FNPRM, the 2011 VRS Rate NPRM, and the 
2010 VRS NOI. Therefore, the Bureau invites commenters to refresh the 
record of CG Docket Nos. 03-123 and 10-51 on the following issues that 
may affect the establishment of a VRS rate for the remainder of the 
2012-13 Fund year and subsequent years:
    27. Should the following cost categories, which RLSA has included 
in its calculation of the proposed rates, be allowable as part of the 
cost basis for rates:
     Marketing (calculated by RLSA as $0.0504 (2010), $0.0441 
(2011), and 0.0466 (2012) per minute);
     Outreach (calculated by RLSA as $0.2741 (2010), $0.2606 
(2011), and 0.2594 (2012) per minute); and
     Research and development (calculated by RLSA as $0.0486 
(2010), $0.0542 (2011), and $0.0523 (2012) per minute)?
    28. Should the Commission continue to limit the kinds and amount of 
capital costs that are allowed to be recovered? Thus, RLSA's proposed 
rate would allow an 11.25% return on invested capital, an element which 
has long been used as the basis for calculating TRS rates, as well as 
other common carrier rates, and which previously has been found to 
address adequately the recovery of interest and principal payments on 
debt, income taxes, and profits. RLSA calculates the weighted-average-
per-minute return on investment, with allowance for taxes, to be 
$0.0949 per minute in 2010, $0.0778 per minute in 2011, and $0.0594 per 
minute (projected) in 2012. The Bureau invites commenters to refresh 
the record on the appropriate treatment of capital costs, rate of 
return, and related issues. Parties that advocate a particular 
alternative for treatment of capital costs should specify the type of 
investment on which they believe providers should be authorized to 
recover a return, the percentage return that they believe is 
appropriate in light of current market conditions, an estimate of the 
dollar amount that their proposed capital cost element would add to 
proposed VRS rates, and the specific reasons why investment and return 
should be so defined for purposes of Fund-compensated VRS.
    29. Should the Commission retain, modify, or eliminate the current 
tiered VRS rate structure?
    30. Should there be a phase-in of the new VRS compensation rate or 
rates? How long should such a phase-in period last and how should rates 
be set during such an initial period? For example, should the 
Commission establish a three-year phase-in period, as RLSA suggests, 
with equal yearly adjustments to reach the new rate?
    31. How long should the new rate remain in effect? In the 2007 TRS 
Rate Methodology Order, the Commission determined that VRS and IP Relay 
compensation rates should be set for a

[[Page 65530]]

three-year period, subject to certain adjustments. Telecommunications 
Relay Services and Speech-to-Speech Services for Individuals with 
Hearing and Speech Disabilities, (2007 TRS Rate Methodology Order), CG 
Docket No. 03-123, published at 73 FR 3197, January 17, 2008. In the 
2010 TRS Rate Order, the Commission again adopted a three-year rate for 
IP Relay, but it adopted a one-year interim rate for VRS. That interim 
VRS rate, however, was extended in 2011 and 2012. Should the new VRS 
rate likewise be instituted for a three-year period, or a different 
period?
    32. As noted above, parties that disagree with RLSA's proposed cost 
categories or rate tiers, or have views on the timing and duration of 
the rate, should offer specific and detailed alternatives and should 
focus their comments, to the maximum extent practicable, on data, 
views, and arguments that can be made publicly available, including the 
specific dollar amounts and percentages.

Federal Communications Commission.
Karen Peltz Strauss,
Deputy Chief, Consumer and Governmental Affairs Bureau.
[FR Doc. 2012-26553 Filed 10-26-12; 8:45 am]
BILLING CODE 6712-01-P