98-17486. Third Quarter 1998 Universal Service Contribution Factors Revised and Approved  

  • [Federal Register Volume 63, Number 126 (Wednesday, July 1, 1998)]
    [Notices]
    [Pages 35930-35931]
    From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
    [FR Doc No: 98-17486]
    
    
    
    [[Page 35930]]
    
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    FEDERAL COMMUNICATIONS COMMISSION
    
    [CC Docket No. 96-45; DA 98-1130]
    
    
    Third Quarter 1998 Universal Service Contribution Factors Revised 
    and Approved
    
    AGENCY: Federal Communications Commission.
    
    ACTION: Notice.
    
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    SUMMARY: The Common Carrier Bureau announces approved universal service 
    contribution factors for the third quarter of 1998.
    
    DATES: The third quarter contribution factors were announced in a 
    Public Notice released on June 12, 1998.
    
    ADDRESSES: One original and five copies of all comments responsive to 
    this Public Notice must be sent to Magalie Roman Salas, Secretary, 
    Federal Communications Commission, 1919 M Street, N.W., Washington, 
    D.C. 20554. Three copies also should be sent to Sheryl Todd, Accounting 
    Policy Division, Common Carrier Bureau, 2100 M Street, N.W., 8th Floor, 
    Washington, D.C. 20554.
    
    FOR FURTHER INFORMATION CONTACT: Lori Wright, Accounting Policy 
    Division, Common Carrier Bureau, (202) 418-7391.
    
    SUPPLEMENTARY INFORMATION: In this Public Notice, the Common Carrier 
    Bureau (Bureau) revises and approves the final universal service 
    contribution factors for the third quarter of 1998. On May 13, 1998, 
    using information submitted on May 1, 1998 by the Universal Service 
    Administrative Company (USAC), Schools and Libraries Corporation (SLC), 
    and Rural Health Care Corporation (RHCC), the Accounting Policy 
    Division (Division) of the Bureau announced the proposed universal 
    service contribution factors for the third quarter of 1998. The 
    proposed factors were published in the Federal Register on May 26, 
    1998. Pursuant to the Commission's rules, if the Commission had taken 
    no action by June 9, 1998, the proposed third quarter contribution 
    factors would have been deemed approved. On June 8, 1998, the Division 
    extended until 11:59 p.m. on June 12, 1998 the time period during which 
    the Commission could modify the proposed third quarter 1998 universal 
    service contribution factors.
        Also on May 13, 1998, the Bureau released a Public Notice seeking 
    comment on whether to reduce the 1998 collection amounts for the 
    schools and libraries and rural health care universal service support 
    mechanisms. In an Order adopted today, the Commission, among other 
    things, adjusts the 1998 collection amounts for the schools and 
    libraries and rural health care universal service support mechanisms. 
    Specifically, the Commission directs USAC to collect only as much as 
    required by demand, but in no event more than $325 million per quarter 
    for the third and fourth quarters of 1998 and the first and second 
    quarters of 1999 to support the schools and libraries universal service 
    support mechanism. The Commission further directs SLC to commit to 
    applicants no more than $1.925 billion for disbursement during 1998 and 
    the first half of 1999. With respect to the rural health care universal 
    service support mechanism, the Commission directs USAC to collect only 
    as much as required by demand, but in no event more than $25 million 
    per quarter for the third and fourth quarters of 1998. The adjustments 
    to the collection amounts for the third quarter of 1998 are reflected 
    in the table below under the ``total program costs'' column. We note 
    that, because the demand for funds exceeds the maximum amount that will 
    be collected for the schools and libraries support mechanism in the 
    third quarter of 1998, the ``total program costs'' for the third 
    quarter (i.e., $325 million) is less than the demand that SLC 
    projected. Because the table lists expenses, positive income flows are 
    denoted with parentheses.
    
                                                   Third Quarter 1998                                               
                                                [In millions of dollars]                                            
    ----------------------------------------------------------------------------------------------------------------
                                                                    Administrative                    Total program 
                       Program                     Program demand      expenses     Interest income       costs     
    ----------------------------------------------------------------------------------------------------------------
    Schools and Libraries.......................            690.0              4.4            (0.0)            325.0
    Rural Health Care...........................             24.3              1.2            (0.5)             25.0
                                                 -------------------------------------------------------------------
          Subtotal..............................            714.3              5.6            (0.5)            350.0
                                                 ===================================================================
    High Cost...................................            414.1              0.8            (0.7)            414.2
    Low Income..................................            125.3              0.4            (1.0)            124.7
                                                 -------------------------------------------------------------------
          Subtotal..............................            539.4              1.2            (1.7)            538.9
                                                 ===================================================================
          Total.................................          1,253.7              6.8            (2.2)            888.9
    ----------------------------------------------------------------------------------------------------------------
    
        Based on information contained in the Universal Service Worksheets, 
    FCC Form 457, USAC submitted on May 1, 1998, end-user 
    telecommunications revenues for the 1997 calendar year. On May 14, 
    1998, USAC submitted revised end-user telecommunications revenues for 
    the 1997 calendar year. Funding bases for the third and fourth quarters 
    are determined by subtracting the revenues reported for January through 
    June 1997 (on the September Worksheet) from the 1997 calendar year 
    revenues reported on the March Worksheet. The amounts are as follows:
    
    Total Interstate, Intrastate, and International End-User 
    Telecommunications Revenues from July 1, 1997--December 31, 1997: 
    $94.066 billion
    Total Interstate and International End-User Telecommunications Revenues 
    from July 1, 1997--December 31, 1997: $34.719 billion
    
        To account for uncollectible contributions, we decrease by one 
    percent the revenue estimates listed above. It has come to our 
    attention that several carriers subject to the universal service 
    contribution obligation have failed to meet this obligation. To 
    maintain the integrity of the universal service support mechanisms, 
    pending enforcement of this obligation, we determine that we should 
    account for uncollectible contributions at a rate of one percent. This 
    is consistent with USAC's estimated rate of uncollectible 
    contributions. Additionally, because each quarter is three months long, 
    we
    
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    estimate quarterly revenues by dividing by two the six-month revenue 
    estimates.
        Based on the revised end-user telecommunications revenues submitted 
    by USAC, SLC, and RHCC, a one-percent reduction in the revenue 
    estimates to account for uncollectible contributions, and consistent 
    with the revised collection amounts for the schools and libraries and 
    rural health care support mechanisms adopted today, the approved 
    contribution factors for the third quarter of 1998 are as follows:
    
    Contribution factor for the schools and libraries and rural health care 
    support mechanisms: Total Program Costs / Contribution Base 
    (Interstate, International, and Intrastate) = $0.350 billion / ( 
    $93.125 billion / 2) = 0.0075
    Contribution factor for the high cost and low income support 
    mechanisms: Total Program Costs / Contribution Base (Interstate and 
    International) = $0.539 billion / ($34.372 billion / 2) = 0.0314
    
        These factors are the approved third quarter 1998 universal service 
    contribution factors that USAC shall use to calculate third quarter 
    universal service contributions. USAC will bill and collect these 
    contributions on a monthly basis.
        For further information, contact Lori Wright, Accounting Policy 
    Division, Common Carrier Bureau, at (202) 418-7400.
    
    Federal Communications Commission.
    Lisa S. Gelb,
    Chief, Accounting Policy Division, Common Carrier Bureau.
    [FR Doc. 98-17486 Filed 6-30-98; 8:45 am]
    BILLING CODE 6712-01-U
    
    
    

Document Information

Published:
07/01/1998
Department:
Federal Communications Commission
Entry Type:
Notice
Action:
Notice.
Document Number:
98-17486
Dates:
The third quarter contribution factors were announced in a Public Notice released on June 12, 1998.
Pages:
35930-35931 (2 pages)
Docket Numbers:
CC Docket No. 96-45, DA 98-1130
PDF File:
98-17486.pdf