[Federal Register Volume 64, Number 121 (Thursday, June 24, 1999)]
[Proposed Rules]
[Pages 33813-33816]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-16182]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Part 54
[CC Docket Nos. 96-45 and 97-21; FCC 99-49]
Changes to the Board of Directors of the National Exchange
Carrier Association, Inc., Federal-State Joint Board on Universal
Service
AGENCY: Federal Communications Commission.
ACTION: Further notice of proposed rulemaking.
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SUMMARY: In this document, the Commission proposes a method for
allocating funds in the event that the Administrator's initial denial
of a request for support is reversed by the Administrator or the
Commission. The Commission proposes a method for allocating support
when there is sufficient funding to support all telecommunications
service and Internet access (priority one services) appeals, but not
sufficient funding to support all internal connection appeals. The
Commission also proposes a method for allocating support in the
unlikely event that sufficient funds are not available for all priority
one service appeals.
DATES: Comments are due on or before June 30, 1999.
ADDRESSES: All filings must be sent to the Commission's Secretary,
Magalie Roman Salas, Office of the Secretary, Federal Communications
Commission,
[[Page 33814]]
445 Twelfth Street, S.W., TW-A325, Washington, D.C. 20554.
FOR FURTHER INFORMATION CONTACT: Sharon Webber, Attorney, Common
Carrier Bureau, Accounting Policy Division, (202) 418-7400.
SUPPLEMENTARY INFORMATION: This is a summary of the Commission's
document released on May 28, 1999. The full text of this document is
available for public inspection during regular business hours in the
FCC Reference Center, Room CY-A257, 445 Twelfth Street, S.W.,
Washington, D.C., 20554.
I. Introduction
1. In the this Further Notice of Proposed Rulemaking (Further
Notice), we propose a method for allocating funds in the event that the
Administrator's initial denial of a request for support is reversed by
the Administrator or the Commission. Specifically, we propose a method
for allocating support when there is sufficient funding to support all
telecommunications service and Internet access (priority one services)
appeals, but not sufficient funding to support all internal connection
appeals. We also propose a method for allocating support in the
unlikely event that sufficient funds are not available for all priority
one service appeals.
2. The Commission's rules provide that an applicant may file a
request for review with the Administrator or the Commission in
connection with the Administrator's denial of an application. Although
the Administrator has taken all reasonable and appropriate steps to
ensure that it will be able to fund fully all appeals that may be
granted, we conclude that it is necessary to adopt additional funding
priority rules setting forth how funds will be allocated in the
unlikely event that sufficient funds are not available at the appeal
phase. Consistent with the Commission's funding priority rules, we
propose that, when a filing window is in effect, the Administrator
shall first fund all priority one service appeals that have been
granted and, if sufficient funds remain, shall allocate funds to
internal connection appeals at each descending single discount
percentage, e.g., ninety percent, eighty-nine percent, and so on. In no
case, however, would an applicant be able to receive support for
internal connections below the discount level for which an applicant
received support in the original application process. That is, if the
Administrator were only able to provide support during the original
application process to applicants at a discount level of seventy
percent or above, an applicant would not be able to receive support on
appeal for an internal connection request at a sixty-nine percent
discount level. To the extent funds do not exist to fund all appeals
granted within a single discount percentage, we propose that the
Administrator allocate the remaining support on a pro rata basis within
that single discount percentage. We seek comment on this proposal.
3. If the Administrator determines that sufficient funds are not
available to fund all priority one service appeals, we propose that the
Administrator allocate the available funds to all appeals for priority
one services, i.e., telecommunications services and Internet access on
a pro rata basis, irrespective of the discount level associated with
the request. We believe that this is the best approach in light of both
the funding priority rules, which grant first priority to requests for
telecommunications services and Internet access, and the Commission's
goal of ensuring that every eligible school and library receive some
assistance. We seek comment on this proposal. In particular, we seek
comment on how this proposed allocation method should be implemented in
light of our appeal procedures, which permit applicants to seek review
of decisions issued by the Administrator from either the Administrator
or the Commission. We tentatively conclude that, to ensure an equitable
distribution of funds to all priority one service appeals, the
Administrator should wait until a final decision has been issued on all
priority one service appeals before it allocates funds on a pro rata
basis. We seek comment on this tentative conclusion. We also seek
comment on whether it would be more appropriate for the Commission to
permit the Administrator to use funds collected in the next funding
year to fund priority one service appeals for the prior year. While we
recognize that using funds collected for the next funding year may
deplete the available funds for that year, we nevertheless seek comment
on whether there are any advantage to such an approach. We also invite
parties to submit alternative proposals that would enable the
Administrator to distribute fairly funds for appeals in the event that
sufficient funds are not available to fund all priority one service
appeals.
4. We recognize that applicants must complete the installation of
internal connections by a date certain for each funding year. We
tentatively conclude that an applicant would be required to complete
the installation of internal connections that received support pursuant
to an appeal within six months from the date that the final decision on
appeal is issued. We seek comment on this tentative conclusion.
5. Finally, pending the outcome of this Further Notice, we find
that, if the Administrator is able to determine that sufficient funds
are available to provide support for all priority one service appeals
that may be granted for the first funding year, the Administrator may
allocate support immediately to such appeals. To the extent funds
remain, and the Administrator is able to determine that sufficient
funds are available to allocate funds to all internal connection
appeals down to the seventy percent discount level, i.e., the lowest
discount level for which applicants received support during the
original funding period, the Administrator may allocate support
immediately to such internal connection appeals that may be granted.
VI. Filing Procedures
6. Pursuant to sections 1.415 and 1.419 of the Commission's rules,
47 CFR 1.415, 1.419, interested parties may file comments by June 30,
1999. Pursuant to section 1.3 of the Commission's rules, 47 CFR 1.3, we
find good cause to waive section 1.415(c) of the Commission's rules,
which provides for the submission of replies to original comments.
Dispensing with reply comments is crucial in light of the urgent need
to provide definitive guidance to the Administrator regarding the
priorities for allocating funds to applications whose initial denials
are reversed by the Administrator or the Commission.
7. Comments may be filed using the Commission's Electronic Comment
Filing System (ECFS) or by filing paper copies. See Electronic Filing
of Documents in Rulemaking Proceedings, 63 FR 24121 (1998). Comments
filed through the ECFS can be sent as an electronic file via the
Internet to http://www.fcc.gov/e-file/ecfs.html>. Generally, only one
copy of an electronic submission must be filed. If multiple docket or
rulemaking numbers appear in the caption of this proceeding, however,
commenters must transmit one electronic copy of the comments to each
docket or rulemaking number referenced in the caption. In completing
the transmittal screen, commenters should include their full name,
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
[[Page 33815]]
e-mail to ecfs@fcc.gov, and should include the following words in the
body of the message, ``get form .'' A sample form
and directions will be sent in reply.
8. Parties who choose to file by paper must file an original and
four copies of each filing. If more than one docket or rulemaking
number appear in the caption of this proceeding, commenters must submit
two additional copies for each additional docket or rulemaking number.
All filings must be sent to the Commission's Secretary, Magalie Roman
Salas, Office of the Secretary, Federal Communications Commission, 445
12th Street, S.W., Washington, D.C. 20554. Parties who choose to file
by paper should also submit their comments on diskette. These diskettes
should be submitted to: Sheryl Todd, Federal Communications Commission,
Common Carrier Bureau, Accounting Policy Division, 445 12th Street,
S.W., room 5-A523, Washington, D.C. 20554. Such a submission should be
on a 3.5-inch diskette formatted in an IBM compatible format using
WordPerfect 5.1 for Windows 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 lead docket number in this
case (97-21)), 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, International
Transcription Service, Inc., room CY-B400, 445 Twelfth Street, S.W.,
Washington, D.C. 20554. For further information, please contact: Sharon
Webber, Common Carrier Bureau, Accounting Policy Division, (202) 418-
7400.
9. Pursuant to section 1.1206 of the Commission's rules, 47 CFR
1.1206, this proceeding will be conducted as a permit-but-disclose
proceeding in which ex parte communications are permitted subject to
disclosure.
VII. Regulatory Flexibility Analysis
A. Initial Regulatory Flexibility Analysis
10. 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 proposed in this Further Notice of
Proposed Rulemaking. 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 Further Notice of Proposed
Rulemaking provided above. The Commission will send a copy of the
Further Notice of Proposed Rulemaking, including this IRFA, to the
Chief Counsel for Advocacy of the Small Business Administration. See 5
U.S.C. 603(a). In addition, the Further Notice of Proposed Rulemaking
and IRFA (or summaries thereof) will be published in the Federal
Register. See id.
11. Need for an Objectives of the Proposed Rules. The Commission's
rules provide that an applicant may file a request for review with the
Administrator or the Commission in connection with the Administrator's
denial of an application. Although the Administrator has taken all
reasonable and appropriate steps to ensure that it will be able to fund
fully all appeals that may be granted, we conclude that it is necessary
to adopt additional funding priority rules setting forth how funds will
be allocated in the unlikely event that sufficient funds are not
available at the appeal phase. Accordingly, the Further Notice proposes
that, when a filing window is in effect, the Administrator shall first
fund all priority one service appeals that have been granted and, if
sufficient funds remain, shall allocate funds to internal connection
appeals at each descending single discount percentage, e.g., ninety
percent, eighty-nine percent, and so on. To the extent funds do not
exist to fund all appeals granted within a single discount percentage,
we propose that the Administrator allocate the remaining support on a
pro rata basis within that single discount percentage. If the
Administrator determines that sufficient funds are not available to
fund all priority one service appeals, the Further Notice proposes that
the Administrator allocate the available funds to all appeals for
priority one services, i.e., telecommunications services and Internet
access on a pro rata basis, irrespective of the discount level
associated with the request.
12. Legal Basis. The proposed action is supported by sections 4(i),
4(j), 201-205, 254, and 403 of the Communications Act of 1934, as
amended, 47 U.S.C. 154(i), 154(j), 201-205, 254, and 403.
13. Description and Estimate of the Number of Small Entities to
which the proposed rules will Apply. 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). 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 1992, there were
approximately 275,801 small organizations. ``Small governmental
jurisdiction'' generally means ``governments of cities, counties,
towns, townships, villages, school districts, or special districts,
with a population of less than 50,000.'' As of 1992, there were
approximately 85,006 such jurisdictions in the United States. This
number includes 38,978 counties, cities, and towns; of these, 37,566,
or 96 percent, have populations of fewer than 50,000. 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 (91 percent) are small entities.
14. Schools and Libraries. The Commission specifically noted in the
Universal Service Order that the SBA defined small elementary and
secondary schools and small libraries as those with under $5 million in
annual revenues. The Commission further estimated that there are fewer
than 86,221 public and 26,093 private schools and fewer than 15,904
libraries that may be affected by the decisions and rules adopted in
the Universal Service Order. We believe that these same small entities
may be affected potentially by the rules proposed in this Further
Notice.
15. Rural Health Care Providers. The Commission noted in the
Universal Service Order that neither the Commission nor the SBA has
developed a definition of small, rural health care providers. Section
254(h)(5)(B) defines the term ``health care provider'' and sets forth
the seven categories of health care providers eligible to receive
universal service support. We estimated that there are fewer than
12,296 health care providers potentially affected by the rules in the
Universal Service Order. We note that these small entities may
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potentially be affected by the rules proposed in this Further Notice.
16. Description of Projected Reporting, Record keeping, and Other
Compliance Requirements. We tentatively conclude that there will not be
any additional burdens or costs associated with the proposed rules on
any entities, including on small entities. We seek comment on this
tentative conclusion.
17. Steps Taken to Minimize Significant Economic Impact on Small
Entities and Significant Alternatives Considered. In the FRFA to the
Universal Service Order, the Commission described the steps taken to
minimize the significant economic impact on a substantial number of
small entities consistent with stated objectives associated with the
Schools and Libraries section, the Rural Health Care Provider section,
and the Administration section of the Universal Service Order. Our
current action to amend our rules will benefit schools, libraries, and
rural health care providers, by ensuring that funds are allocated first
to the neediest schools and libraries and that schools, libraries, and
rural health care providers will be able to receive any support
approved by the Administrator that is not the subject of an appeal. We
believe that the amended rules fulfill the statutory mandate to enhance
access to telecommunications services for schools, libraries, and rural
health care providers, and fulfill the statutory principle of providing
quality services at ``just, reasonable, and affordable rates,'' without
imposing unnecessary burdens on schools, libraries, rural health care
providers, or service providers, including small entities.
18. Federal Rules That May Overlap, Duplicate, or Conflict with the
Proposed Rule. None.
VIII. Ordering Clauses
19. Accordingly, it is ordered that, pursuant to the authority
contained in sections 1-4, 201-205, 218-220, 254, 303(r), 403 and 405
of the Communications Act of 1934, as amended, 47 U.S.C. 151-154, 201-
205, 218-220, 254, 303(r), 403 and 405, section 553 of the
Administrative Procedure Act, 5 U.S.C. 553, and section 1.108 of the
Commission's rules, 47 CFR 1.108, the Further Notice of Proposed
Rulemaking is adopted.
20. It is further ordered that, because the Commission has found
good cause, this Further Notice of Proposed Rulemaking is effective
upon publication in the Federal Register.
21. It is further ordered that the Commission's Office of Public
Affairs, Reference Operations Division, shall send a copy of this
Further Notice of Proposed Rulemaking, including the Initial Regulatory
Flexibility Analysis, to the Chief Counsel for Advocacy of the Small
Business Administration.
List of Subjects in 47 CFR Part 54
Healthcare providers, Libraries, Reporting and recordkeeping
requirements, Schools, Telecommunications, Telephone.
Federal Communications Commission.
Magalie Roman Salas,
Secretary.
[FR Doc. 99-16182 Filed 6-23-99; 8:45 am]
BILLING CODE 6712-01-P
