[Federal Register Volume 84, Number 47 (Monday, March 11, 2019)]
[Rules and Regulations]
[Pages 8619-8624]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-04261]
-----------------------------------------------------------------------
FEDERAL COMMUNICATIONS COMMISSION
47 CFR Part 54
[WC Docket No. 10-90; FCC 19-8]
Connect America Fund
AGENCY: Federal Communications Commission.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: In this document, the Federal Communications Commission
(Commission) takes a small but important step towards closing the
digital divide and making broadband available for all Americans, by
phasing down legacy support for voice services to make greater funding
available for voice and broadband services. Specifically, the
Commission adopts a transition framework to phase down Connect America
Fund (CAF) Phase I frozen support in areas where support is now awarded
pursuant to the CAF Phase II auction.
DATES: Effective April 10, 2019, except for the addition of Sec.
54.313(m), which contains information collection requirements that have
not been approved by OMB. The FCC will publish a document in the
Federal Register announcing the effective date of the Sec. 54.313
amendment awaiting OMB approval.
FOR FURTHER INFORMATION CONTACT: Alexander Minard, Wireline Competition
Bureau, (202) 418-7400 or TTY: (202) 418-0484.
SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Report
and Order in WC Docket No. 10-90; FCC 19-8, adopted on February 14,
2019 and released on February 15, 2019. 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 or at the following internet address: https://docs.fcc.gov/public/attachments/FCC-19-8A1.pdf.
I. Introduction
1. In this Report and Order, the Commission takes a small but
important step towards closing the digital divide and making broadband
available for all Americans, by phasing down legacy support for voice
services to make greater funding available for voice and broadband
services. Specifically, the Commission adopts a transition framework to
phase down Connect America Fund (CAF) Phase I frozen support in areas
where support is now awarded pursuant to the CAF Phase II auction.
Winning bidders were awarded $1.488 billion in support over 10 years to
deploy broadband in 45 states to 713,176 locations. Approximately 73%
of the locations available in the CAF Phase II auction were covered by
winning bids, significantly narrowing the areas where price cap
carriers will maintain voice-only obligations under the legacy regime.
The transition plan the Commission adopts in this document provides
certainty and stability in those areas by establishing a reasonable
support glide path as the Commission transitions from one support
mechanism to another.
II. Discussion
2. As the Commission has noted, ``the CAF is not created on a blank
slate, but rather against the backdrop of a decades-old regulatory
system.'' Thus, a smooth transition must account for the several
support mechanisms currently in effect as well as the auction outcomes
in different areas. To comprehensively resolve these phase-down issues
prior to authorizing CAF Phase II auction support, the Commission
addresses the transition of both price cap carriers' and competitive
eligible telecommunications carriers (ETCs) offering service to fixed
locations (fixed competitive ETCs') legacy support together.
3. Pursuant to the April 2014 Connect America Further Notice, 79 FR
39196, July 9, 2014, the Commission adopts a methodology for
disaggregating support by employing the Connect America Cost Model
(CAM) to account for the relative costs of providing service among
areas in states where price cap carriers declined model-based CAF Phase
II support. These price cap carriers currently receive an amount of
frozen support for each carrier's designated service area within a
particular state. Within that state, the Commission uses the CAM to
allocate a portion of each carrier's existing frozen support to each
auction-eligible census block based on the relative costs of providing
service across all auction-eligible census blocks within the same
state. Consistent with the cap for reserve prices exceeding the
extremely high-cost threshold in the CAF Phase II auction, the
Commission limits the allocated monthly support for any census block to
$146.10 per location.
4. The Commission concludes that the interim methodology it adopts
is a reasonable approach for allocating support among a price cap
carrier's census blocks because it targets support based on the
relative costs of providing service based on the CAM. Phase I frozen
support was based largely on inherently inefficient legacy support
mechanisms that did not reflect the costs of serving high-cost and
extremely high-cost areas; the Commission's interim methodology now
ties disaggregated support amounts to the costs of serving each
affected census block for the transitional period. The Commission also
concludes that the methodology it adopts is preferable to the proposal
in the April 2014 Connect America Further Notice because it better
calibrates the available support with the cost to serve the defined
areas. The Commission's 2014 proposal would have distributed the legacy
support that carriers received in each state based on the average cost
to serve all high-cost and extremely high-cost areas in that state. As
a result, it would have allocated the same amount of support regardless
of the relative mix of high-cost and extremely high-cost areas that
carriers are required to serve after the auction until a replacement
ETC is in place.
5. The Commission adopts the schedule in the following for the
transition of price cap carriers' and fixed competitive ETCs' legacy
support. This transition schedule will fund new service obligations
undertaken by Phase II auction winners, protect customers of current
support recipients from a potential loss of service, and minimize the
disruption to recipients of frozen legacy support from a loss of
funding. It balances the need for responsible stewardship of finite
universal service funds against the need to distribute funding for
voice and broadband services consistent with the results of the
Commission's CAF Phase II auction
[[Page 8620]]
while providing a reasonable termination of legacy support for voice
services. The schedule the Commission adopts maintains the Commission's
prior decision that a price cap carrier declining model-based Phase II
support will continue to receive support in an amount equal to its
Phase I frozen support amount only until the winner of any competitive
bidding process receives support under Phase II. Accordingly, in the
Commission's implementation of Phase II auction support, the Commission
now establishes a path toward eliminating legacy support, except to
maintain service on an interim basis in auction-eligible, high-cost
areas where there was no winning bidder in the CAF Phase II auction,
pending further Commission action.
6. For auction-eligible census blocks where price cap carriers
receive CAF Phase I frozen support, starting the first day of the month
following the authorization of Phase II auction support in a price cap
carrier's designated service area within a state, the price cap
carrier's legacy support will be (1) converted to Phase II support (for
a winning price cap carrier bidder); (2) maintained for an interim
period (for the price cap carrier in areas without a winning bidder);
or (3) eliminated (for price cap carriers in areas won by another
carrier).
7. Although the CAF Phase II auction saw significant interest, some
eligible areas did not receive a qualifying winning bid. By including
these areas in the auction, the Commission has already determined that
these areas require continued high-cost support. Thus, in those
auction-eligible areas where there was no winning bidder in the Phase
II auction, the price cap carrier will continue to receive
disaggregated legacy support until further Commission action. That is,
interim support will be determined for each census block consistent
with the legacy support disaggregation methodology the Commission
adopts. Maintaining such support is necessary on an interim basis to
preserve service to consumers in these areas, pending further
Commission action. At the same time, using the Commission's
disaggregation methodology will ensure interim support is distributed
more efficiently.
8. For areas where the winning bidder is the price cap carrier
receiving legacy support, Phase II support will commence on the first
day of the month after the support is authorized by the Wireline
Competition Bureau in that area. To ensure a smooth transition to Phase
II support, a winning bidder will receive support payments at the
current, disaggregated legacy support level until that time. Continuing
disaggregated legacy support until Phase II support has been authorized
for each census block will minimize disruptions and ensure continuity
of services for consumers. And, as with areas without any winning
bidder, using disaggregated legacy support amounts until Phase II
support is authorized will better target legacy support during the
interim period than the inherently inefficient legacy support
mechanisms used on which Phase I frozen support are based.
9. In areas won at auction by a carrier other than the price cap
carrier, beginning on the first day of the month immediately following
authorization to receive Phase II support, the winning bidder ETC will
begin receiving support and bear an obligation to serve those areas.
Accordingly, the price cap carrier will not receive legacy support for
those census blocks beginning on the first day of the month after Phase
II support is authorized for those census blocks. At that point,
continued legacy support would become duplicative.
10. Auction-Ineligible Blocks. In all census blocks determined to
be ineligible for the CAF Phase II auction, price cap carriers that
declined statewide model-based support will no longer receive legacy
support starting the first day of the month following the first
authorization of any Phase II auction support nationwide. By excluding
certain areas from the auction, the Commission has already determined
not to offer ongoing high-cost support for those areas. Thus, this
approach implements the Commission's earlier decision not to distribute
Phase I frozen support after Phase II auction support has begun.
11. Fixed competitive ETCs' legacy support will be subject to a
two-year phase down, beginning on the first day of the month
immediately following the first authorization of any Phase II auction
support. Fixed competitive ETCs will receive phase-down support equal
to two-thirds of their total legacy support for the first 12 months.
For the following 12 months, fixed competitive ETCs will receive one-
third of their total legacy support. All legacy support will end
thereafter.
12. Unlike the phase down for price cap carriers' legacy support in
auction-eligible areas, the timing of the phase down for fixed
competitive ETCs' legacy support will not differ by census block. For
fixed competitive ETCs, the Commission concludes that a straightforward
phase-down of support is more appropriate; fixed competitive ETCs
receive a comparatively small amount of legacy support, and few
expressed interest in continuing to provide service by participating in
the CAF Phase II auction. The two-year phase-down schedule resumes the
phase-down schedule adopted in the USF/ICC Transformation Order, 76 FR
73830, November 29, 2011, for competitive ETCs. The two-year phase-down
schedule thus eliminates support that is no longer necessary while
providing an appropriate adjustment period for affected carriers.
13. In sum, Tables 1 and 2 in the following illustrate the
transition schedule the Commission adopts.
Table 1--Transition of Price Cap Carriers' Legacy Support
------------------------------------------------------------------------
Before the first day of the month
following authorization of any Phase II Transition schedule
support nationwide
------------------------------------------------------------------------
Price cap carrier receives legacy Beginning the first day of the
support in an eligible census block month following authorization
won by that carrier in the Phase II of Phase II support in an
auction. auction-eligible census block,
legacy support is converted to
Phase II support.
Price cap carrier receives legacy Legacy support is maintained
support in an eligible census block until further Commission
with no winning bidder in the Phase II action.
auction.
Price cap carrier receives legacy Beginning the first day of the
support in a census block won by month following authorization
another carrier in the Phase II of Phase II support in an
auction. auction-eligible census block,
legacy support is eliminated.
Price cap carrier receives legacy Beginning the first day of the
support in an auction-ineligible month following authorization
census block. of any Phase II support
nationwide, legacy support is
eliminated.
------------------------------------------------------------------------
[[Page 8621]]
Table 2--Transition of Fixed Competitive ETCs' Legacy Support
----------------------------------------------------------------------------------------------------------------
Beginning 12 months Beginning 24 months
Beginning the first day after the first day of after the first day of
Before the first day of the month of the month following the month following the the month following the
following the first authorization of the first authorization first authorization of first authorization of
any Phase II support nationwide of any Phase II support any Phase II support any Phase II support
nationwide nationwide nationwide
----------------------------------------------------------------------------------------------------------------
Fixed competitive ETC receives legacy Legacy support is Legacy support is Legacy support is
support. reduced to two-thirds reduced to one-third eliminated.
of support. of support.
----------------------------------------------------------------------------------------------------------------
14. In establishing this schedule, the Commission declines to
adopt, within the context of the high-cost universal service program, a
different definition of ``unsubsidized competitor,'' i.e., by including
areas with mobile or non-terrestrial voice service. The existence of
other voice service options within a particular census block does not
guarantee that consumers there will continue to have access to voice
service in the absence of an ETC being required to serve those
consumers. The Commission therefore remains unpersuaded that it needs
not continue providing support to ETCs simply based on the fact that
there are multiple non-ETCs serving that census block.
15. The Commission also declines to adopt USTelecom's most recent
proposal to (1) distribute $105 million in ``new voice support'' across
all high-cost and extremely high-cost census blocks for which, after
the CAF Phase II auction, price cap carriers will continue to have an
ETC obligation to provide voice service; (2) distribute an additional
$35 million in transitional support to carriers receiving less ``new
voice support'' in a state than the carrier's ``residual frozen
support'' amount for that state; and (3) phase down the additional
transitional support over a two-year period. The Commission finds this
proposal inconsistent with the overarching objective of transitioning
away from the current Phase I frozen support funding mechanism.
Instead, USTelecom seeks to expand the areas for which price cap
carriers receive support--through a new funding mechanism, ``new voice
support''--to include areas where they do not currently receive legacy
support. The Commission declines to do so. Through the interim
framework the Commission adopts, it establishes a reasonable process
for transitioning Phase I frozen support and fixed competitive ETCs'
legacy support after the authorization of Phase II auction support.
Price cap carriers currently receive Phase I frozen support for use
within particular service areas, and the Commission now allocates that
support across the census blocks for which the support is provided,
i.e., within the same service areas, to be phased down, converted, or
maintained.
16. Even if the Commission were to adopt a transition mechanism
more like USTelecom's proposal, modified to only include areas for
which carriers receive legacy support, the proposed annual budget of
$105 million for ``new voice support'' and first-year budget of $35
million in additional transitional support would far exceed a
reasonable amount of legacy support for carriers to continue serving
only those areas not won at auction. USTelecom explains that $105
million ``equals the $95 million of frozen support currently
distributed to price cap carriers and $10 million of additional support
to account for ACS's participation in the program.'' Under USTelecom's
proposal, as with the transition mechanism the Commission adopts,
carriers would not receive legacy support in either areas ineligible
for the auction or areas won at auction. But USTelecom's proposal would
require distributing a fixed amount of $105 million--more than the
total frozen support price cap carriers currently receive--across the
remaining areas and up to $35 million in additional support for some of
those same areas. In contrast, the Commission's method efficiently
targets support by using the CAM to allocate the support a price cap
carrier currently receives to serve its entire service area according
to the relative costs of serving each census block and then removing
only the support associated with census blocks for which the price cap
no longer has a federal high-cost voice obligation. The approach the
Commission adopts today therefore more rationally ties the current
legacy support a price cap carrier receives in a designated service
area within a state to the phase-down support it will continue to
receive until further Commission action. The Commission does not
believe increasing support to maintain existing voice service in these
areas--even on an interim basis--is a good use of the Commission's
limited funds.
17. The Commission recognizes, nonetheless, that drawing on the
results of legacy support mechanisms may produce results undesirable to
certain carriers. Under those legacy mechanisms, some price cap
carriers did not receive legacy support in certain states containing
high-cost and extremely high-cost areas. The Commission has likewise
explained that the identical support rule for competitive ETCs
``fail[ed] to efficiently target support where it is needed.''
Accordingly, the Commission emphasizes that the phase-down support
maintained under its transition mechanism is not intended to provide a
long-term solution. Instead, until the Commission is able to implement
a new program, it maintains a targeted portion of carriers' existing
legacy support to preserve affordable consumer access to
telecommunications in high-cost areas. In adopting this interim
framework, the Commission thus balances its statutory duties to ensure
affordable access to quality services, promote in ``rural, insular, and
high cost areas . . . access to telecommunications and information
services . . . that are reasonably comparable to those services
provided in urban areas and that are available at rates that are
reasonably comparable to rates charged for similar services in urban
areas,'' and establish ``specific, predictable and sufficient . . .
mechanisms to preserve and advance universal service.''
18. The Commission also provides price cap carriers and fixed
competitive ETCs the option to decline phase-down support on a state-
by-state basis. It is possible that, despite their mandatory voice
obligations, some carriers may conclude that they do not wish to
continue receiving legacy support in every state. The Commission
therefore directs the Wireline Competition Bureau to calculate and
publish, for each price cap carrier's designated service area within
each affected state, the amount of support available in every census
block after the authorization of Phase II auction support within the
same service area. Within 30 days after the release of public notice of
such support amounts, price cap carriers and fixed competitive ETCs
electing not to receive phase-down support in any states must provide
notice of such election in the manner specified by the Wireline
Competition Bureau.
[[Page 8622]]
19. Regardless of the carrier's election, however, the federal ETC
high-cost obligation to provide voice service is mandatory and
independent of whether a carrier accepts phase-down support. To the
extent a price cap carrier or fixed competitive ETC no longer wishes to
maintain its ETC designation in the relevant areas, it may petition the
relevant state to relinquish its ETC designation for those areas where
another ETC is providing service, and it may choose to go through the
section 214 discontinuance process. For those price cap carriers and
fixed competitive ETCs that receive phase-down support, the Commission
will require that they certify annually that they have and will use the
support they continue to receive in the relevant high-cost and
extremely high-cost areas to provide voice telephony service throughout
the relevant census blocks at rates that are reasonably comparable to
comparable offerings in urban areas.
20. To the extent that any carrier believes it needs additional
support to provide voice service at reasonably comparable rates
throughout the remaining census blocks within its service area, it may
request a waiver pursuant to Section 1.3 of the Commission's rules. In
evaluating requests for a waiver, the Commission will consider any
relevant facts presented by the carrier that demonstrate it is
necessary and in the public interest for the price cap carrier to
receive that additional funding to maintain reasonably priced voice
service. Examples of such facts would include not only all revenues
derived from network facilities that are supported by universal service
but also revenues derived from unregulated and unsupported services.
The Commission does not, however, expect to grant these requests
routinely, and caution petitioners that it generally intends to subject
such requests to a rigorous, thorough and searching review comparable
to a total company earnings review.
III. Procedural Matters
A. Paperwork Reduction Analysis
21. The Report and Order adopted herein contains new or modified
information collection requirements subject to the Paperwork Reduction
Act of 1995 (PRA), Public Law 104-13. It will be submitted to the
Office of Management and Budget (OMB) for review under section 3507(d)
of the PRA. OMB, the general public, and other Federal agencies will be
invited to comment on the new or modified information collection
requirements contained in this proceeding. In addition, the Commission
notes that pursuant to the Small Business Paperwork Relief Act of 2002,
Public Law 107-198, see 44 U.S.C. 3506(c)(4), it previously sought
specific comment on how the Commission might further reduce the
information collection burden for small business concerns with fewer
than 25 employees. In this present document, the Commission has
assessed the effects of the new and modified rules that might impose
information collection burdens on small business concerns, and find
that they either will not have a significant economic impact on a
substantial number of small entities or will have a minimal economic
impact on a substantial number of small entities.
B. Congressional Review Act
22. The Commission will send a copy of this Report and Order to
Congress and the Government Accountability Office pursuant to the
Congressional Review Act, see 5 U.S.C. 801(a)(1)(A).
23. As required by the Regulatory Flexibility Act of 1980 (RFA), as
amended, an Initial Regulatory Flexibility Analysis (IRFAs) was
incorporated in the Further Notice of Proposed Rulemaking adopted in
April 2014 (April 2014 Connect America Further Notice). The Commission
sought written public comment on the proposals in April 2014 Connect
America Further Notice, including comment on the IRFA. The Commission
did not receive any relevant comments in response to this IRFA. This
Final Regulatory Flexibility Analysis (FRFA) conforms to the RFA.
24. The Report and Order addresses outstanding issues regarding the
transition of legacy universal service support--i.e., price cap
carriers' Connect America Fund (CAF) Phase I frozen support and the
frozen identical support of competitive eligible telecommunications
carriers (ETCs) offering service to fixed locations (fixed competitive
ETCs)--after the authorization of support pursuant to the CAF Phase II
auction. The transition plan provides certainty and stability in areas
covered by winning bids in the CAF Phase II auction by establishing a
reasonable support glide path as the Commission transitions from one
support mechanism to another.
25. Specifically, in the Report and Order, the Commission adopts a
methodology to disaggregate price cap carriers' existing CAF Phase I
frozen support among areas based on the relative costs of serving
different census blocks, and the Commission adopts a schedule for
transitioning this legacy support upon the authorization of CAF Phase
II auction support. The Commission also adopts a schedule for
transitioning fixed competitive ETCs' legacy support over a two-year
period. The Commission provides an option for price cap carriers and
fixed competitive ETCs to decline phase-down support on a state-by-
state basis, and the Commission adopts a modified annual certification
requirement for carriers that elect phase-down support.
26. 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. 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. 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).
27. Small Businesses, Small Organizations, Small Governmental
Jurisdictions. The Commission's actions, over time, may affect small
entities that are not easily categorized at present. The Commission
therefore describes here, at the outset, three broad groups of small
entities that could be directly affected herein. First, while there are
industry specific size standards for small businesses that are used in
the regulatory flexibility analysis, according to data from the SBA's
Office of Advocacy, in general a small business is an independent
business having fewer than 500 employees. These types of small
businesses represent 99.9 percent of all businesses in the United
States which translates to 28.8 million businesses.
28. Next, the type of small entity described as a ``small
organization'' is generally ``any not-for-profit enterprise which is
independently owned and operated and is not dominant in its field.''
Nationwide, as of Aug 2016, there were approximately 356,494 small
organizations based on registration and tax data filed by nonprofits
with the Internal Revenue Service (IRS).
29. Finally, the small entity described as a ``small governmental
jurisdiction'' is defined generally as ``governments of cities,
counties, towns, townships, villages, school districts, or special
districts, with a population of less than fifty thousand.'' U.S. Census
Bureau data from the 2012 Census of
[[Page 8623]]
Governments indicates that there were 90,056 local governmental
jurisdictions consisting of general purpose governments and special
purpose governments in the United States. Of this number there were
37,132 General purpose governments (county, municipal and town or
township) with populations of less than 50,000 and 12,184 Special
purpose governments (independent school districts and special
districts) with populations of less than 50,000. The 2012 U.S. Census
Bureau data for most types of governments in the local government
category shows that the majority of these governments have populations
of less than 50,000. Based on this data the Commission estimates that
at least 49,316 local government jurisdictions fall in the category of
``small governmental jurisdictions.''
30. In the Report and Order, the Commission requires that price cap
carriers and fixed competitive ETCs that receive phase-down support
certify annually that they have and will use the support they continue
to receive in the relevant high-cost and extremely high-cost areas to
provide voice telephony service throughout the relevant census blocks
at rates that are reasonably comparable to comparable offerings in
urban areas. Price cap carriers and fixed competitive ETCs may elect,
however, not to receive phase-down support.
31. The RFA requires an agency to describe any significant
alternatives that it has considered in reaching its proposed approach,
which may include (among others) the following four alternatives: (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. The Commission has considered all these factors subsequent to
receiving substantive comments from the public and potentially affected
entities. The Commission has also considered the economic impact on
small entities, as identified in comments filed in response to the
April 2014 Connect America Further Notice and IRFA, in reaching its
final conclusions and taking action in this proceeding.
32. In the Report and Order, the Commission adopts a transition
schedule providing a gradual two-year phase-down for fixed competitive
ETCs' legacy support. Among those carriers, of which many are small
entities, few expressed interest in continuing to provide service in
areas where they receive legacy support by participating in the CAF
Phase II auction. The two-year phase-down schedule resumes the schedule
adopted in the USF/ICC Transformation Order for competitive ETCs, and
thus eliminates support that is no longer necessary while providing an
appropriate adjustment period for affected carriers.
33. As an alternative to this straightforward transition schedule,
the Commission has considered implementing a schedule more similar to
price cap carriers' transition--i.e., fixed competitive ETCs could
continue receiving legacy support in certain auction-eligible areas and
quickly stop receiving legacy support associated with auction-
ineligible areas. However, this would add complexity to the process
with no benefit to fixed competitive ETCs.
34. The Commission also provides an option for price cap carriers
and fixed competitive ETCs to elect not to receive phase-down support
and be subject to the associated obligations. In doing so, the
Commission minimizes any impact economic impact to small entities and
other carriers. Carriers opting to continue receiving legacy support
subject to the phase-down schedule must continue to file a modified
annual certification regarding their use of support, but those carriers
are not subject to any additional requirements.
IV. Ordering Clauses
35. Accordingly, it is ordered, pursuant to the authority contained
in sections 4(i), 214, and 254 of the Communications Act of 1934, as
amended, 47 U.S.C. 154(i), 214, and 254, that this Report and Order is
adopted, effective thirty (30) days after publication of the text or
summary thereof in the Federal Register, except that modifications to
Paperwork Reduction Act burdens shall become effective immediately upon
announcement in the Federal Register of OMB approval.
36. It is further ordered that Part 54 of the Commission's rules,
47 CFR part 54 is amended as set forth in the following, and such rule
amendments shall be effective thirty (30) days after publication of the
rules amendments in the Federal Register, except to the extent they
contain information collections subject to PRA review. The rules that
contain information collections subject to PRA review shall become
effective immediately upon announcement in the Federal Register of OMB
approval.
List of Subjects in 47 CFR Part 54
Communications common carriers, Health facilities, Infants and
children, internet, Libraries, Reporting and recordkeeping
requirements, Schools, Telecommunications, Telephone.
Federal Communications Commission.
Cecilia Sigmund,
Federal Register Liaison Officer.
Final Rules
For the reasons discussed in the preamble, the Federal
Communications Commission amends 47 CFR part 54 as follows:
PART 54--UNIVERSAL SERVICE
0
1. The authority citation for part 54 continues to read as follows:
Authority: 47 U.S.C. 151, 154(i), 155, 201, 205, 214, 219, 220,
254, 303(r), 403, and 1302 unless otherwise noted.
0
2. Section 54.307 is amended by adding paragraph (e)(8) to read as
follows:
Sec. 54.307 Support to a competitive eligible telecommunications
carrier.
* * * * *
(e) * * *
(8) Eligibility for support after Connect America Phase II auction.
Starting the first day of the month following the first authorization
of Connect America Phase II auction support nationwide, fixed
competitive eligible telecommunications carriers shall have the option
of receiving support pursuant to paragraph (e)(2)(iii) of this section
as described in the following paragraphs (e)(8)(i) through (iv):
(i) For 12 months following the first authorization of Connect
America Phase II auction support nationwide, each fixed competitive
eligible telecommunications carrier shall receive two-thirds (\2/3\) of
the carrier's total support pursuant to paragraph (e)(2)(iii) of this
section.
(ii) For 12 months starting the month following the period
described in paragraph (e)(8)(i) of this section, each fixed
competitive eligible telecommunications carrier shall receive one-third
(\1/3\) of the carrier's total support pursuant to paragraph
(e)(2)(iii) of this section.
(iii) Following the period described in paragraph (e)(8)(ii) of
this section, no fixed competitive eligible telecommunications carrier
shall receive any support pursuant to paragraph (e)(2)(iii) of this
section.
(iv) Notwithstanding the foregoing schedule, the phase-down of
support below the level described in paragraph
[[Page 8624]]
(e)(2)(iii) of this section shall be subject to the restrictions in
Consolidated Appropriations Act, 2016, Public Law 114-113, Div. E,
Title VI, section 631, 129 Stat. 2242, 2470 (2015), unless and until
such restrictions are no longer in effect.
0
3. Section 54.312 is amended by adding paragraph (d) to read as
follows:
Sec. 54.312 Connect America Fund for Price Cap Territories--Phase I.
* * * * *
(d) Eligibility for support after Connect America Phase II auction.
(1) A price cap carrier that receives monthly baseline support pursuant
to this section and is a winning bidder in the Connect America Phase II
auction shall receive support at the same level as described in
paragraph (a) of this section for such area until the Wireline
Competition Bureau determines whether to authorize the carrier to
receive Connect America Phase II auction support for the same area.
Upon the Wireline Competition Bureau's release of a public notice
approving a price cap carrier's application submitted pursuant to Sec.
54.315(b) and authorizing the carrier to receive Connect America Fund
Phase II auction support, the carrier shall no longer receive support
at the level of monthly baseline support pursuant to this section for
such area. Thereafter, the carrier shall receive monthly support in the
amount of its Connect America Phase II winning bid.
(2) Starting the first day of the month following the first
authorization of Connect America Phase II auction support nationwide,
no price cap carrier that receives monthly baseline support pursuant to
this section shall receive such monthly baseline support for areas that
are ineligible for Connect America Phase II auction support.
(3) To the extent Connect America Phase II auction support is not
awarded at auction for an eligible area, as determined by the Wireline
Competition Bureau, the price cap carrier shall have the option of
continuing to receive support at the level described in paragraph (a)
of this section until further Commission action.
(4) Starting the first day of the month following the authorization
of Connect America Phase II auction support to a winning bidder other
than the price cap carrier that receives monthly baseline support
pursuant to this section for such area, the price cap carrier shall no
longer receive monthly baseline support pursuant to this section.
(5) Notwithstanding the foregoing schedule, the phase-down of
support below the level described in paragraph (a) of this section
shall be subject to the restrictions in Consolidated Appropriations
Act, 2016, Public Law 114-113, Div. E, Title VI, section 631, 129 Stat.
2242, 2470 (2015), unless and until such restrictions are no longer in
effect.
0
4. Section 54.313 is amended by adding paragraph (m) to read as
follows:
Sec. 54.313 Annual reporting requirements for high-cost recipients.
* * * * *
(m) Any price cap carrier or fixed competitive eligible
telecommunications carrier that elects to continue receiving support
pursuant to Sec. 54.312(d) or Sec. 54.307(e)(2)(iii) shall provide
certifications, starting July 1, 2020 and for each subsequent year they
receive such support, that all such support the company received in the
previous year was used to provide voice service throughout the high-
cost and extremely high-cost census blocks where they continue to have
the federal high-cost eligible telecommunications carrier obligation to
provide voice service pursuant to Sec. 54.201(d) at rates that are
reasonably comparable to comparable offerings in urban areas. Any price
cap carrier or fixed competitive eligible telecommunications carrier
that solely receives support pursuant to Sec. 54.312(d) or Sec.
54.307(e)(2)(iii) in its designated service area shall not be subject
to reporting requirements in any other paragraphs in this section for
such support.
[FR Doc. 2019-04261 Filed 3-6-19; 4:15 pm]
BILLING CODE 6712-01-P