[Federal Register: July 17, 2003 (Volume 68, Number 137)]
[Proposed Rules]
[Page 42333-42337]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr17jy03-28]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Part 54
[WC Docket No. 03-109; FCC 03-120]
Lifeline and Link-Up Programs
AGENCY: Federal Communications Commission.
ACTION: Proposed rule.
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SUMMARY: In this document, the Commission seeks comment on the
Recommended Decision, of the Federal-State Joint Board on Universal
Service (Joint Board) regarding modifications to the Lifeline and Link-
Up programs. The Commission seeks comment regarding the Joint Board's
recommendations.
DATES: Comments are due on or before August 18, 2003. Reply comments
are due on or before September 2 , 2003.
ADDRESSES: Federal Communications Commission, 445 12th Street, SW.,
Washington, DC 20554. See SUPPLEMENTARY INFORMATION for filing
instructions.
FOR FURTHER INFORMATION CONTACT: Shannon Lipp, Attorney,
Telecommunications Access Policy, Wireline Competition Bureau, (202)
418-7400.
SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Notice
of Proposed Rulemaking in WC Docket No. 03-109, FCC 03-120, released on
June 9, 2003. The full text of this document is available for public
inspection during regular business hours in the FCC Reference Center,
Room CY-A257, 445 12th Street, SW., Washington, DC 20554.
I. Introduction
1. In this Notice of Proposed Rulemaking (NPRM), the Commission
seeks comment on the Recommended Decision of the Federal-State Joint
Board on Universal Service (Joint Board) regarding modifications to the
Lifeline and Link-Up programs. In its Recommended Decision, the Joint
Board recommended that the Commission expand the default federal
eligibility criteria to include an income-based criterion and
additional means-tested programs. In addition, the Joint Board
recommended that the Commission require states, under certain
circumstances, to adopt verification procedures. Finally, to more
effectively target low-income consumers, the Joint Board recommended
that the Commission provide outreach guidelines for the Lifeline/Link-
Up program.
2. The Commission notes that the Joint Board recommended that the
Commission specifically seek comment on several issues. In particular,
the Joint Board recommended that the Commission seek more information
about the reasons for differences in low-income penetration rates over
time and among states. The Joint Board recommended that the Commission
adopt a voluntary information collection from the states regarding
their Lifeline/Link-Up programs, and seek comment on the survey's
format and questions. The Joint Board also recommended that the
Commission seek comment on whether it would be possible to modify the
Link-Up program to directly address barriers posed by outstanding
unpaid balances for local and long distance services. In addition, the
Joint Board recommended that the Commission obtain more information
about how an appeals process for the termination of Lifeline benefits
could work and whether 60 days was an appropriate time period for a
consumer to appeal. Finally, the Joint Board recommended that the
Commission seek comment on whether states could adopt verification of
continued Lifeline eligibility procedures within one year. The
Commission encourages commenters to address these issues in their
comments.
3. In addition, the Commission seeks comment on several minor
changes to clarify and streamline our rules. Section 52.33(a)(1)(i)(C)
of the Commission's rules states that ``Lifeline Assistance Program
customers shall not receive the monthly number-portability charge.''
However, this rule is not referenced in Sec. 54.401 of the
Commission's rules where Lifeline is defined. The Commission proposes
to add paragraph (e) to Sec. 54.401 to clarify that Lifeline customers
are exempt from the monthly number-portability charge, cross-
referencing Sec. 52.33(a)(1)(i)(C). Additionally, in the First Report
and Order, 62 FR 32862, June 17, 1997, the Commission adopted the Joint
Board's recommendation to prohibit service deposit requirements for
customers who accept toll limitation. Currently, Sec. 54.401(c) states
that, ``[e]ligible telecommunications carriers may not collect a
service deposit in order to initiate Lifeline service, if the
qualifying low-income consumer voluntarily elects toll blocking from
the carrier, where available. If toll blocking is unavailable, the
carrier may charge a service deposit.'' The Commission proposes to
amend this section by replacing ``toll blocking'' with ``toll
limitation'' to make this rule consistent with the First Report and
Order. Finally, subpart G of part 36 of our rules, Lifeline Connection
Assistance Expense Allocation, states that ``[t]his subpart shall be
effective through December 31, 1997. On January 1, 1998, Lifeline
Connection Assistance shall be provided in accordance with part 54,
subpart E of this chapter.'' Because Sec. Sec. 36.701 through 36.741
contained in this subpart are no longer effective, the Commission
proposes to remove this subpart from our rules.
II. Procedural Issues
A. Ex Parte Presentations
4. This is a permit but disclose rulemaking proceeding. Ex parte
presentations are permitted, except during the Sunshine Agenda period,
as
[[Page 42334]]
long as they are disclosed as provided in the Commission's rules.
B. Initial Paperwork Reduction Act Analysis
5. This NPRM may modify an information collection. As part of a
continuing effort to reduce paperwork burdens, we invite the general
public and the Office of Management and Budget (OMB) to take this
opportunity to comment on the information collections contained in this
NPRM, as required by the Paperwork Reduction Act of 1995, Public Law
104-13. Public and agency comments are due at the same time as other
comments on this Notice; OMB comments are due August 18, 2003. Comments
should address: (a) Whether the proposed collection of information is
necessary for the proper performance of the functions of the
Commission, including whether the information shall have practical
utility; (b) the accuracy of the Commission's burden estimates; (c)
ways to enhance the quality, utility, and clarity of the information
collected; and (d) ways to minimize the burden of the collection of
information on the respondents, including the use of automated
collection techniques or other forms of information technology.
C. Initial Regulatory Flexibility Analysis
6. As required by the Regulatory Flexibility Act (RFA), the
Commission has prepared this Initial Regulatory Flexibility Analysis
(IRFA) of the possible significant economic impact on small entities by
the policies and rules proposed in this NPRM. 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 NPRM
provided below in section I.D. The Commission will send a copy of the
NPRM, including this IRFA, to the Chief Counsel for Advocacy of the
Small Business Administration. In addition, the NPRM and IRFA (or
summaries thereof) will be published in the Federal Register.
1. Need for and Objectives of the Proposed Rules
7. On December 21, 2000, the Commission requested the Joint Board
to review the Lifeline/Link-Up program for all low-income consumers.
The Joint Board subsequently released a public notice seeking comment
on the Lifeline/Link-Up program. On April 2, 2003, the Joint Board
released its recommendations regarding modifications to the Lifeline/
Link-Up program. This NPRM seeks comment on the Joint Board's
recommendations.
8. Since its inception, the Lifeline/Link-Up program has provided
support for telephone service to millions of low-income consumers.
Despite this success, the Commission believes that the program can be
further improved. For example, expanding the current federal default
eligibility criteria to add an income-based criterion of 135% of the
Federal Poverty Guidelines (FPG) and additional means-tested programs
would allow the Lifeline/Link-Up program to adapt to the changes
resulting from ``The Personal Responsibility and Work Opportunity
Reconciliation Act'' (PROWRA) and would otherwise address issues
associated with receiving public assistance. Permitting eligibility
based solely on income responds to concerns that PROWRA has caused
decreased enrollment in welfare assistance programs. Participants in
means-tested programs must meet income-based eligibility criteria that
vary by program. Requiring participation in such programs or utilizing
income-based criteria ensures that only low-income consumers are
eligible for Lifeline/Link-Up support.
9. Adding certification for income-based eligibility and
verification requirements for program and income-based eligibility
would ensure that only eligible low-income individuals receive
benefits, thereby preventing fraud and abuse. Adopting outreach
guidelines would facilitate the marketing of the Lifeline/Link-Up
program to eligible individuals and increase telephone subscribership
among low-income households. Finally, issuing a survey form would
enable the Commission to gather data and information from states
regarding the administration of Lifeline/Link-Up programs. The
Commission believes that these proposed modifications to the Lifeline/
Link-Up program may increase Lifeline/Link-Up subscription rates and
make phone service affordable to more low-income individuals and
families.
2. Legal Basis
10. The legal basis as proposed for this NPRM is contained in
sections 4(i), 4(j), 201-205, 214, 254, and 403 of the Communications
Act of 1934, as amended, 47 U.S.C. 4(i), 4(j), 201-205, 214, 254, 403.
3. Description and Estimate of the Number of Small Entities to Which
the Proposed Rules Will Apply
11. 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).
12. The Commission's decision to adopt certification and
verification requirements, and its use of a voluntary survey, would
apply to service providers that provide services to qualifying low-
income consumers who receive Lifeline/Link-Up support. According to the
Universal Service Administrative Company's (USAC) 2002 Annual Report,
only local exchange carriers, cellular/personal communications services
(PCS) providers, and competitive access providers would be subject to
these requirements. Because many of these service providers could
include small entities, the Commission expects that the proposal in
this proceeding could have a significant economic impact on local
exchange carriers, small incumbent local exchange carriers, cellular/
PCS providers, and competitive access providers that are small
entities.
13. Small Incumbent Local Exchange Carriers. The Commission has
included small incumbent local exchange carriers in this present RFA
analysis. As noted above, a ``small business'' under the RFA is on
that, inter alia, meets the pertinent small business size standard
(e.g., a telephone communications business having 1,500 or fewer
employees), and ``is not dominant in its field of operation.'' The
SBA's Office of Advocacy contends that, for RFA purposes, small
incumbent local exchange carriers are not dominant in their field of
operation because any such dominance is not ``national'' in scope. The
Commission has therefore included small incumbent local exchange
carriers in this RFA analysis, although we emphasize that this RFA
action has no effect on Commission analyses and determinations in
other, non-RFA contexts.
14. Local Exchange Carriers, Small Incumbent Local Exchange
Carriers, Competitive Access Providers. Neither the Commission nor the
SBA has developed a size standard specifically for small providers of
local exchange services. The closest applicable size standard under the
SBA rules is for wired telecommunications carriers. This
[[Page 42335]]
provides that a wired telecommunications carrier is a small entity if
it employs no more than 1,500 employees. According to the most recent
Commission data there are 1,619 local services providers with 1,500 or
fewer employees. Because it seems certain that some of these carriers
are not independently owned and operated, the Commission is unable at
this time to estimate with greater precision the number of these
carriers that would qualify as small business concerns under SBA's size
standard. Of the 1,619 local service providers, 1,024 are incumbent
local exchange carriers, 411 are Competitive Access Providers (CAPs)
and Competitive Local Exchange Carriers (CLECs), 131 are resellers and
53 are other local exchange carriers. Consequently, the Commission
estimate that no more than 1,619 providers of local exchange service
are small entities may be affected.
15. Cellular and Other Wireless Telecommunications. The SBA has
developed a small business size standard for Cellular and Other
Wireless Telecommunications, which consists of all such firms having
1,500 or fewer employees. According to data for 1997, a total of 977
such firms operated for the entire year. Of those, 965 firms employed
999 or fewer persons for the year, and 12 firms employed 1,000 or more.
Therefore, nearly all such firms were small businesses. In addition,
the Commission notes that there are 1,807 cellular licenses; however, a
cellular licensee may own several licenses. According to Commission
data, 858 carriers reported that they were engaged in the provision of
cellular service, Personal Communications Service (PCS), or Specialized
Mobile Radio telephony service, which are placed together in the data.
We have estimated that 291 of these are small under the SBA small
business size standard.
16. Broadband Personal Communications Service (PCS). The broadband
PCS spectrum is divided into six frequencies designated A through F,
and the Commission has held auctions for each block. The Commission
defined ``small entity'' for Blocks C and F as an entity that has
average gross revenues of less than $40 million in the three previous
calendar years. For Block F, an additional classification for ``very
small business'' was added and is defined as an entity that, together
with their affiliates, has average gross revenues of not more than $15
million for the preceding three calendar years. These regulations
defining ``small entity'' in the context of broadband PCS auctions have
been approved by the SBA. No small businesses within the SBA-approved
definition bid successfully for licenses in Blocks A and B. There were
90 winning bidders that qualified as small entities in the Block C
auctions. A total of 93 small and very small business bidders won
approximately 40% of the 1,479 licenses for Blocks D, E, and F. On
March 23, 1999, the Commission re-auctioned 347 C, D, E, and F Block
licenses; there were 48 small business winning bidders. Based on this
information, the Commission concludes that the number of small
broadband PCS licensees will include the 90 winning C Block bidders and
the 93 qualifying bidders in the D, E, and F blocks, plus the 48
winning bidders in the re-auction, for a total of 231 small entity PCS
providers as defined by the SBA and the Commission's auction rules. On
January 26, 2001, the Commission completed the auction of 422 C and F
Broadband PCS licenses in Auction No. 35. Of the 35 winning bidders in
this auction, 29 qualified as small or very small businesses.
4. Description of Projected Reporting, Recordkeeping, and Other
Compliance Requirements
17. Currently, carriers that receive Lifeline/Link-Up support are
required to submit FCC Form 497 on a quarterly basis for each month.
Regardless of any rule changes, carriers will continue to be required
to submit this form to USAC. Should the Commission decide to adopt the
Joint Board's recommendation to require states to implement and
carriers to perform certification and verification procedures, the
associated rule changes could require carriers to retain additional
records to document compliance with performing certification and
verification of a consumer's eligibility. Without more certainty about
which options the Commission will or will not adopt as rules, we cannot
accurately estimate the cost of compliance by small carriers, including
whether FCC Form 497 will require carriers to provide more information
in response to new rule changes. In this NPRM, the Commission therefore
seeks comment on the types of burdens carriers will face in retaining
records documenting certification and verification compliance, and in
submitting reports to USAC. The Commission also seeks comment on
whether the costs of such recordkeeping and reporting are outweighed by
the potential benefits of the possible reforms. Entities, especially
small businesses, are encouraged to quantify, if possible, the costs
and benefits of the reporting and recordkeeping requirement proposals,
if possible.
5. Steps Taken To Minimize Significant Economic Impact on Small
Entities, and Significant Alternatives Considered
18. The RFA requires an agency to describe any significant
alternatives that it has considered in reaching its proposed approach,
which may include the following four alternatives (among others): (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.
19. The NPRM seeks comment on how to reduce the administrative
burden and cost of compliance for small telecommunications service
providers. The Commission has accepted the statutory requirement that
an alternative be considered when necessary to protect the interests of
small entities. We particularly seek comment from contributors that are
``small business concerns'' under the Small Business Act on the
following proposals contained in the Recommended Decision.
20. The Commission seeks comment, for example, on the Joint Board's
recommendation that the Commission require carriers to notify consumers
of their impending termination of Lifeline benefits when the carrier
initiates termination of a consumer's Lifeline benefits. The consumer
could have up to 60 days to appeal to their carrier before Lifeline
support is discontinued. The Commission seeks further comment on how
such an appeals process would work, balancing the needs of Lifeline
recipients with the administrative burden that an appeals process may
impose on carriers. Without such an appeals process, consumers may have
difficulty maintaining telephone service if the consumer's financial
situation temporarily fluctuates. Telephone service is necessary for
finding and keeping a job, thus assisting the consumer in his/her climb
out of poverty into the working world.
21. To reduce the administrative burden on states to adopt
certification and verification procedures, the Joint Board compiled an
appendix of state certification and verification procedures to provide
guidance to other states seeking to adapt those procedures to their
state Lifeline/Link-Up programs. Although these requirements may impose
an additional burden on carriers required to perform the certification
and
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verification, the Joint Board believes that these requirements prevent
fraud and abuse, maintain the integrity of the Lifeline universal
service support mechanism, and are necessary to help control costs.
6. Federal Rules That May Duplicate, Overlap, or Conflict With the
Proposed Rules
22. None.
D. Comment Filing Procedures
23. The Commission invites comment on the issues and questions set
forth in the Notice of Proposed Rulemaking and Initial Regulatory
Flexibility Analysis contained herein. Pursuant to applicable
procedures set forth in sections 1.415 and 1.419 of the Commission's
rules, interested parties may file comments on or before August 18,
2003. Reply comments are due on or before September 2, 2003. All
filings should refer to WC Docket No. 03-109. Comments may be filed
using the Commission's Electronic Comment Filing System (ECFS) or by
filing paper copies.
24. Comments filed through 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. In completing
the transmittal screen, commenters should include their full name,
Postal Service mailing address, and the applicable docket number, which
in this instance is WC Docket No. 03-109. Parties may also submit an
electronic comment by Internet e-mail. To receive filing instructions
for e-mail comments, commenters should send an 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.
25. 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 appears in the caption of this proceeding, commenters must
submit two additional copies for each additional docket or rulemaking
number. Parties who choose to file by paper are hereby notified that
effective December 18, 2001, the Commission's contractor, Vistronix,
Inc., will receive hand-delivered or messenger-delivered paper filings
for the Commission's Secretary at a new location in downtown
Washington, DC. The address is 236 Massachusetts Avenue, NE., Suite
110, Washington, DC, 20002. The filing hours at this location will be 8
a.m. to 7 p.m. All hand deliveries must be held together with rubber
bands or fasteners. Any envelopes must be disposed of before entering
the building.
This facility is the only location where hand-delivered or
messenger-delivered paper filings for the Commission's Secretary will
be accepted. Accordingly, the Commission will no longer accept these
filings at 9300 East Hampton Drive, Capitol Heights, MD, 20743. Other
messenger-delivered documents, including documents sent by overnight
mail (other than United States Postal Service (USPS) Express Mail and
Priority Mail), must be addressed to 9300 East Hampton Drive, Capitol
Heights, MD, 20743. This location will be open 8 a.m. to 5:30 p.m. The
USPS first-class mail, Express Mail, and Priority Mail should continue
to be addressed to the Commission's headquarters at 445 12th Street
SW., Washington, DC 20554. The USPS mail addressed to the Commission's
headquarters actually goes to our Capitol Heights facility for
screening prior to delivery at the Commission.
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If you are sending this type of document or It should be addressed
using this delivery method-- for delivery to--
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Hand-delivered or messenger-delivered paper 236 Massachusetts Avenue,
filings for the Commission's Secretary. NE., Suite 110,
Washington, DC 20002 (8
a.m. to 7 p.m.)
Other messenger-delivered documents, 9300 East Hampton Drive,
including documents sent by overnight mail Capitol Heights, MD
(other than United States Postal Service 20743 (8 a.m. to 5:30
Express Mail and Priority Mail). p.m.)
United States Postal Service first-class 445 12th Street SW.,
mail, Express Mail, and Priority Mail. Washington, DC 20554
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All filings must be sent to the Commission's Secretary: Marlene H.
Dortch, Office of the Secretary, Federal Communications Commission, 445
12th Street SW., Suite TW-A325, Washington, DC, 20554.
26. Parties who choose to file by paper should also submit their
comments on diskette to Sheryl Todd, Telecommunications Access Policy
Division, Wireline Competition Bureau, Federal Communications
Commission, 445 12th Street, SW., Room 5-B540, Washington, DC 20554.
Such a submission should be on a 3.5 inch diskette formatted in an IBM
compatible format using Microsoft Word or compatible software. The
diskette should be accompanied by a cover letter and should be
submitted in ``read only'' mode. The diskette should be clearly labeled
with the commenter's name, proceeding (including the docket number, in
this case, WC Docket No. 03-109), type of pleading (comment or reply
comment), date of submission, and the name of the electronic file on
the diskette. The label should also include the following phrase ``Disk
Copy--Not an Original.'' Each diskette should contain only one party's
pleading, preferably in a single electronic file. In addition,
commenters must send diskette copies to the Commission's copy
contractor, Qualex International, Portals II, 445 12th Street, SW.,
Room CY-B402, Washington, DC 20554.
27. Regardless of whether parties choose to file electronically or
by paper, parties should also file one copy of any documents filed in
this docket with the Commission's copy contractor, Qualex
International, Inc., Portals II, 445 12th Street SW., Room CY-B402,
Washington, DC, 20554. Comments and reply comments will be available
for public inspection during regular business hours in the FCC
Reference Center, Room CY-A257, 445 12th Street SW., Washington, DC,
20554. In addition, the full text of this document is available for
public inspection and copying during regular business hours at the FCC
Reference Information Center, Portals II, 445 12th Street SW., Room CY-
A257, Washington, DC, 20554. This document may also be purchased from
the Commission's duplicating contractor, Qualex International, Portals
II, 445 12th Street, SW., Room CY-B402, Washington, DC, 20554,
telephone 202-863-2893, facsimile 202-863-2898, or via e-mail
qualexint@aol.com. 28. Comments and reply comments must include a short and concise
summary of the substantive arguments raised in the pleading. Comments
and reply comments must also comply with section 1.49 and all other
applicable sections of the Commission's rules. We direct all interested
parties to include the name of the filing party and the date of the
filing on each page of their comments and reply comments. All parties
are encouraged to utilize a table of contents, regardless of the length
of their submission. We also strongly encourage parties to track the
organization set forth in the NPRM in
[[Page 42337]]
order to facilitate our internal review process.
E. Further Information
29. To request materials in accessible formats for people with
disabilities (braille, large print, electronic files, audio format),
send an e-mail to fcc504@fcc.gov or call the Consumer & Governmental
Affairs Bureau at 202-418-0531 (voice), 202-418-7365 (tty).
30. For further information, contact Shannon Lipp at (202) 418-7400
or Diane Law Hsu at (202) 418-7400 in the Telecommunications Access
Policy Division, Wireline Competition Bureau.
III. Ordering Clauses
31. Pursuant to the authority contained in sections 4(i), 4(j),
201-205, 214, 254, and 403 of the Communications Act of 1934, as
amended, this Notice of Proposed Rulemaking is adopted.
32. The Commission's Consumer and Governmental Affairs Bureau,
Reference Information Center, shall send a copy of this 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
Reporting and recordkeeping requirements, Telecommunications,
Telephone.
Federal Communications Commission.
Marlene H. Dortch,
Secretary.
[FR Doc. 03-18056 Filed 7-16-03; 8:45 am]
BILLING CODE 6712-01-P