[Federal Register: September 24, 2007 (Volume 72, Number 184)]
[Rules and Regulations]
[Page 54214-54219]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr24se07-8]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Part 54
[WC Docket No. 05-195, CC Docket No. 96-45, CC Docket No. 02-6, WC
Docket No. 02-60, WC Docket No. 03-109, CC Docket No. 97-21; FCC 07-
150]
Measures To Safeguard the Universal Service Fund From Waste,
Fraud, and Abuse as Well as Measures To Improve the Management,
Administration, and Oversight of the Universal Service Fund
AGENCY: Federal Communications Commission.
ACTION: Final rule.
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SUMMARY: In the Report and Order, the Commission adopted measures to
safeguard the Universal Service Fund (``USF'') from waste, fraud, and
abuse. The intended effect of the measures adopted is to improve the
management, administration, and oversight of the USF.
DATES: Effective October 24, 2007 except for the amendments to
Sec. Sec. 54.202, 54.417, 54.619, and 54.706, which contain
information collection requirements that are not effective until
approved by the Office of Management and Budget. The FCC will publish a
document in the Federal Register announcing the effective date for
those sections. Additionally, the Commission will send, as a minor
rule, a copy of this
[[Page 54215]]
Report and Order to Congress and the Government Accountability Office
pursuant to the Congressional Review Act, 5 U.S.C. 801(a)(1)(A).
FOR FURTHER INFORMATION CONTACT: Mika Savir at (202) 418-0384,
Mika.Savir@fcc.gov, Office of Managing Director, Federal Communications
Commission, 445 12th Street, SW., Washington, DC 20554. In addition, a
copy of any comments on the Paperwork Reduction Act information
collection requirements contained herein should be submitted to Leslie
Smith, Federal Communications Commission, 445 12th Street, SW.,
Washington, DC 20554, or via the Internet to PRA@fcc.gov.
SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Report
and Order adopted August 22, 2007 and released August 29, 2007. The
full text of this Report and Order is available for public inspection
on the Commission's Internet site at http://www.fcc.gov. It is also
available for inspection and copying during regular business hours in
the FCC Reference Center (Room CY-A257), 445 12th Street, SW.,
Washington, DC 20554. The full text of this document also may be
purchased from the Commission's duplication contractor, Best Copy and
Printing Inc., Portals II, 445 12th St., SW., Room CY-B402, Washington,
DC 20554; telephone (202) 488-5300; fax (202) 488-5563; e-mail
FCC@BCPIWEB.COM.
The Universal Service Fund (``USF'') was created by Congress in
1996 as part of its passage of the Telecommunications Act of 1996. The
purpose of the fund is to help provide affordable telecommunications
services to consumers, libraries, rural health care facilities, and
schools. Today, the USF consists of four programs: (1) The universal
service mechanism for high-cost areas, providing financial support to
eligible telecommunications carriers serving high-cost areas; (2) the
universal service mechanism for schools and libraries, providing for
discounted services (telecommunications services, Internet access, and
internal connections) to eligible schools and libraries; (3) the
universal service mechanism for assisting low-income consumers with
discounted installation and monthly telephone services; and (4) the
universal service mechanism for rural health care, providing discounted
telecommunications and information services to rural health care
providers. These funds are managed, on behalf of the Commission, by the
Universal Service Administrative Company (``USAC'' or
``Administrator'').
The goal of the proceeding, initiated on June 14, 2005, was to
improve these four universal service programs, to make these programs
more effective and efficient, and to continue the Commission's efforts
to deter waste, fraud, and abuse of Universal Service funds.
In conducting the proceeding, input was sought from all interested
parties, including USF participants. Eighty-four comments were received
and considered as the Commission came to its decisions on how to
improve the management, administration, and oversight of the USF.
Synopsis
On June 14, 2005, the Commission initiated a broad inquiry into the
management, administration, and oversight of the USF. That inquiry
asked whether: (a) The Commission should adopt rules requiring timely
payments and assessing penalties or interest for late payments to the
USF programs; (b) the Commission should institute a targeted
independent audit requirement to safeguard the USF programs from waste,
fraud, and abuse; (c) the Commission should put in place document
retention requirements for applicants and service providers; (d) the
Commission should establish time limits for making determinations about
whether violations have occurred among USF program recipients; (e) the
Commission should adopt specific sanctions to address instances in
which a USF beneficiary may not have used funds in accordance with
program procedures; (f) the Commission should institute aggressive
debarment procedures for anyone who defrauds or otherwise deliberately
harms the integrity of the USF programs; and (g) the Commission should
require USAC to report on certain efficiency, effectiveness, accuracy,
and timeliness performance measures.
(a) Decision regarding timely payments--since the USF is supported
by contributions from telecommunications carriers providing interstate
services as well as contributions by certain providers of interstate
telecommunications, including providers of Interconnected Voice over
Internet Protocol (``Interconnected VoIP'') services, the Commission
determined that it should adopt tougher rules requiring timely payments
and assessing penalties or interest for late payments.
Thus, the Commission decided that it would replace the existing
late-filing charge, as well as the late-payment charges; with a new
``rate of interest'' charge that reflects the consequences of failing
to pay in a timely manner. Henceforth, if a contributor is more than 30
days delinquent in paying its contribution to the USF, USAC shall
assess a single rate of interest, that will apply to the debt from the
date of the delinquency until date of payment (or in the case of a
promissory note the date of maturity of the note), at an annual rate
equal to the U.S. prime rate on the date of delinquency plus 3.5
percent.
Likewise, if a contributor is more than 30 days delinquent in
filing an FCC Form 499-A or 499-Q, the USAC Administrator shall also
use the U.S. prime rate plus 3.5 percent in assessing a remedial
sanction. The sanction will be the greater of $100 per month or the
amount derived when a rate of interest equal to the U.S. prime rate
plus 3.5 percent is assessed on the amount due per the USAC
Administrator's invoice or calculations (if no invoice was provided).
In the event a contributor company is delinquent in filing an FCC
Form 499-A or 499-Q, and within the 30 day period following
delinquency, is also delinquent in paying its contribution, interest
will be assessed on a single greater amount from the date of the first
delinquency.
USAC is now required to add information to the monthly invoice sent
to contributors and in debt collection correspondence to explain the
applicable sanction and administrative charges for late payment.
(b) Decision regarding independent audits--audits are a tool the
Commission and USAC use to ensure program integrity and to detect
violations of the Act or the Commission's rules and to deter waste,
fraud, and abuse.
Current Commission rules already authorize the USAC Administrator
to conduct audits of contributors to the universal service support
mechanisms. In addition, the Commission's OIG annually oversees more
than 400 audits of contributors and beneficiaries of the high-cost,
low-income, rural health care, and schools and libraries programs.
The Commission has decided that additional audit requirements are
unnecessary at this time. The Commission will closely watch the data
emerging from existing audits to determine if additional or targeted
audits should be conducted in the future.
(c) Decision regarding document retention--proper record-keeping
helps prevent waste, fraud, and abuse. Proper record-keeping
additionally protects applicants and service providers in the event of
vendor disputes. The Commission concluded that, following
[[Page 54216]]
OMB approval of these Paperwork Reduction Act information collection
requirements, the following record-keeping will be required:
(1) High-cost program--the Commission will require recipients of
universal service high-cost support to retain, for five years, all
records that they may require to demonstrate to auditors that the
support they received was consistent with the Communications Act of
1934, as amended, and the Commission's rules. These records must
include the following: Data supporting line count filings; historical
customer records; fixed asset property accounting records; general
ledgers; invoice copies for the purchase and maintenance of equipment;
maintenance contracts for the upgrade or equipment; and any other
relevant documentation. The Commission also clarified that
beneficiaries must make available all such documents and records that
pertain to them, including those of NECA, contractors, and consultants
working on behalf of the beneficiaries to the Commission's OIG, to the
USAC Administrator, and to their auditors. To the extent other rules or
any other law require or necessitate documents be kept for longer
periods of time (e.g., to support the account balances in the Part 32
Uniform System of Accounts, continuing property records, pole
attachment calculations, plant equipment age, cost, or useful life,
depreciation rates), the Commission did not alter, amend, or supplant
such rules or laws.
(2) Low-income program--with respect to the Lifeline and Link-Up
programs, the Commission concluded that a ``service-plus three''
document retention requirement will be retained. The Commission did not
believe it to be unnecessarily burdensome to require participating
service providers to retain eligibility-determination records for the
time period during which the service is provided and then for three
years after the service is terminated. Additionally, the Commission
removed the clause that waived the document retention requirement after
an audit is completed. The Commission also clarified that beneficiaries
must make available all documents and records that pertain to them,
including those of contractors and consultants working on their behalf,
to the Commission's OIG, to the USAC Administrator, and to auditors
working on their behalf.
(3) Rural Health Care and Schools and Libraries programs--the
Commission decided to retain the five year requirement for schools and
libraries to retain records evidencing that the funding they received
was proper. The Commission also decided to expand this requirement to
rural health care service providers. This Report and Order additionally
clarified that beneficiaries must make available all documents and
records that pertain to them, including those of contractors and
consultants working on their behalf, to the Commission's OIG, to the
USAC Administrator, and to their auditors.
(4) Contributors--the Commission also required contributors to the
USF to retain all documents and records necessary to demonstrate to
auditors that their contributions were made in compliance with the
program rules, assuming that the audits are conducted within five years
of such contribution. The Commission clarified that contributors must
make available all documents and records that pertain to them,
including those of contractors and consultants working on their behalf,
to the Commission's OIG, to the USAC Administrator, and to their
auditors. These documents and records should include without limitation
the following: financial statements and supporting documentation;
accounting records; historical customer records; general ledgers; and
any other relevant documentation.
(d) Decision regarding time limits for determining violations--the
Commission will adopt a five-year administrative limitations period for
all funds. During these five years the Commission or the USAC
Administrator may determine that a violation has occurred among
recipients of the funds. This five year limit, which currently applies
only to recipients of the schools and libraries fund, will now apply to
recipients of all USF programs. This time period appropriately balances
the beneficiary's need for finality with the Commission statutory
obligation to safeguard the USF programs from waste, fraud, and abuse.
This five-year time period is not a statute of limitations.
(e) Decision regarding sanctions for misuse of funds--consistent
with a prior Commission conclusion regarding the schools and libraries
program, the Commission determined that funds disbursed from the high-
cost, low-income, and rural health care support mechanisms that are
disbursed or used in violation of a Commission rule that implements the
statute or a substantive program goal should be recovered. The
Commission has determined that sanctions, including enforcement action,
are appropriate in cases of waste, fraud, and abuse, but not in cases
of clerical or ministerial errors.
(f) Decision regarding debarment for actions that harm the
integrity of the program--there have been several well-publicized cases
of fraud against the schools and libraries program. In order to prevent
further fraud, and to prevent bad actors from continuing to participate
in this program, the Commission earlier adopted a three year debarment
rule for the schools and libraries program that suspends and debar
parties who are convicted of criminal violations or held civilly liable
for acts arising out of participation in the schools and libraries
program, absent extraordinary circumstances.
The Commission now applies these debarment procedures to all
Universal Service programs. Henceforth, any party convicted of or held
civilly liable for the commission or attempted commission of fraud and
similar offenses will be debarred from participation in the program for
a period of three years. Additionally, the Commission and the USAC
Administrator will publish the names of these debarred entities on
their respective Internet websites. The USAC Administrator will also
provide a link from its website to the Bureau and Commission debarment
orders.
(g) Decision regarding performance measures--following the
requirements of the Government Performance and Results Act, the
Commission established the following performance measures:
(1) Schools and Libraries--since nearly 100 percent connectivity to
the Internet already exists for public schools and the Commission is
not in a position to evaluate either the impact of schools and
libraries funds on connectivity as compared to other funding sources or
the impact of Internet connectivity on educational outcomes, the
Commission decided on group of policy, productivity, and efficiency
performance measures.
In the policy arena, the USAC Administrator is to collect
information during interviews with schools and libraries about the
different types or capacities of broadband services that are supported
through the school and libraries program. The Commission further
requires the USAC Administrator to work with the Wireline Competition
Bureau (``Bureau'') to modify the relevant FCC forms or to create
additional questions for program participants to more accurately
determine how schools and libraries connect to the Internet and their
precise levels of connectivity. The collections of such additional
information, after approval by OMB under the terms of the Paperwork
Reduction Act, will enable the Commission to identify the specific
products, services, and capabilities (e.g., T-1s, DS-3s) at specific
quantities
[[Page 54217]]
provided by the schools and libraries program.
The Commission also requires the USAC Administrators to cross-
reference participating school districts with a full listing of school
districts to identify the public schools that are not participating in
the schools and libraries program in order to focus outreach on these
schools. The USAC Administrator should determine why these schools and
libraries choose not to participate and assist them, if necessary, in
the beginning of the application process. The USAC Administrator should
report its conclusions to the Commission annually.
In the productivity arena, the Commission is requiring the USAC
Administrator to provide data, on a funding year basis, reporting the
number of applications and funding request numbers (``FRNs'')
submitted, the number of applications and FRNs rejected, the number of
applications and FRNs granted, and the processing time for applications
and FRNs. The USAC Administrator is also required to document the
amount of time it takes to make a payment to the service provider, from
the date the proper form is submitted. The Commission recognizes that
the USAC Administrator could reject more invoices in order to improve
the amount of time it takes to make payments. For this reason, the
Commission also requires the USAC Administrator to provide the number
of paid invoices and the number of rejected invoices.
In the efficiency arena, the Commission is directing the USAC
Administrator to determine the percentage of appeals that are resolved
by the USAC Administrator within 90 days from the date of appeal. The
USAC Administrator will also provide information on how long it takes
to process 50 percent, 75 percent, and 100 percent of the pending
appeals from the schools and libraries division.
(2) Low-income--the Commission currently lacks the baseline
information necessary to make an assessment of whether the program is
accomplishing its goal. Therefore the Commission has directed the USAC
Administrator to provide the following baseline information: (a) Number
of program beneficiaries (i.e., carriers); (b) number of low-income
customers for which each carrier receives low-income support; (c)
number of connections supported; (d) time to process support payments
and authorize disbursements; (e) average (mean) dollar amount awarded
and median dollar amount awarded, per carrier; and (f) total amount
disbursed. This baseline information will assist the Commission in
setting performance measures in the future.
In addition, to further expand its baseline knowledge, the
Commission requires the USAC Administrator to provide the Commission
with specified information from a survey that is taken by service
providers of the customers in the Lifeline benefits program. The
information to be provided to the Commission includes: (a) The number
of Lifeline customers surveyed by the service providers; (b) the Number
of Lifeline customers found to be ineligible; and (c) the Number of
Lifeline customers who did not respond to the service provider survey.
The Commission may revisit this issue at a later time and request
further information from the Lifeline survey.
(3) Rural Health Care--the Commission requires the USAC
Administrator to provide the following performance information: time to
process applications; time to pay invoices; and time to determine
appeals. These data will provide a baseline against which subsequent
goals can be implemented in the future.
Additionally, except for the rural health care pilot program, the
USAC Administrator is to provide the Commission with specified
productivity and efficiency performance data in regard to its
application processing, invoice processing, and handling of appeals.
(4) High-cost--because it does not have sufficient data at this
time to establish performance goals; the Commission directs the USAC
Administrator to provide baseline information against which goals can
be implemented in the future. The information to be provided includes
the: (a) Number of program beneficiaries per study area and per wire
center; (b) number of lines, per study area and per wire center (c)
number of requests for support payments; (d) mean dollar amount of
support and median dollar amount of support for each line; (d) total
amount disbursed; (e) time to process 50 percent, 75 percent, and 100
percent of the high-cost support requests and authorize disbursements;
and (f) rates of telephone subscribership in urban versus rural areas.
(5) USAC Administrative Performance Measures--the Commission
additionally adopted a requirement that the USAC Administrator provide
some general, not program-specific, performance data. The required
performance data include: (a) The amount of payments determined to be
improper payments and the error rate (i.e., the percentage of total
payments that are determined to be improper payments); (b) the amount
of improper payments subsequently recovered from the beneficiaries by
the USAC Administrator; (c) data on USAC administrative costs, per
program, and general administrative costs (not program-specific); (d)
the amount of payments determined to be improper payments and the error
rate (i.e., the percentage of total payments that are determined to be
improper payments), per program; (e) the amount of improper payments
subsequently recovered from the beneficiaries by the USF Administrator,
per program; (f) the number of corrections or true-ups due to errors by
the USAC Administrator, per program; (g) the number of USF
contributors; number of USF contributors 90 days or more delinquent in
payments; (h) the total amount of delinquencies or past due payments;
(i) the total number of contributors assessed late fees or penalties;
(j) the total amount of late fees or penalties; (k) the total amount of
contributions to the USF; and (l) the total amount of disbursements.
List of Subjects in 47 CFR Part 54
Communications common carriers, Health facilities, Infants and
children, Libraries, Reporting and recordkeeping requirements, Schools,
Telecommunications, Telephone.
Federal Communications Commission.
Marlene H. Dortch,
Secretary.
Final Rules
0
For the reasons discussed in the preamble, the Federal Communications
Commission amends 47 CFR part 54 as follows:
0
1. The authority citation for part 54 continues to read as follows:
Authority: Secs. 5, 48 Stat. 1068, as amended; 47 U.S.C. 155.
0
2. Section 54.202 is amended by adding paragraph (e) to read as
follows:
Sec. 54.202 Additional requirements for Commission designation of
eligible telecommunications carriers.
* * * * *
(e) All eligible telecommunications carriers shall retain all
records required to demonstrate to auditors that the support received
was consistent with the universal service high-cost program rules.
These records should include the following: data supporting line count
filings; historical customer records; fixed asset property accounting
records; general ledgers; invoice copies for the purchase and
maintenance of equipment; maintenance contracts for the upgrade or
equipment; and any other relevant documentation. This
[[Page 54218]]
documentation must be maintained for at least five years from the
receipt of funding.
0
3. Section 54.417(a) is amended by revising the undesignated paragraph
to read as follows:
Sec. 54.417 Recordkeeping requirements.
(a) * * *
Notwithstanding the preceding sentence, eligible telecommunications
carriers must maintain the documentation required in Sec. Sec.
54.409(d) and 54.410(b)(3) for as long as the consumer receives
Lifeline service from that eligible telecommunications carrier
* * * * *
0
4. Redesignate Sec. 54.521 as Sec. 54.8 and revise pargraphs (a)(1),
(a)(5), (a)(7), (c), (d), (e)(2)(i), (e)(3), (e)(4), and (g) to read as
follows:
Sec. 54.8 Prohibition on participation: Suspension and debarment.
(a) Definitions--(1) Activities associated with or related to the
schools and libraries support mechanism, the high-cost support
mechanism, the rural health care support mechanism, and the low-income
support mechanism. Such matters include the receipt of funds or
discounted services through one or more of these support mechanisms, or
consulting with, assisting, or advising applicants or service providers
regarding one or more of these support mechanisms.
* * * * *
(5) Debarment. Any action taken by the Commission in accordance
with these regulations to exclude a person from activities associated
with or relating to the schools and libraries support mechanism, the
high-cost support mechanism, the rural health care support mechanism,
and the low-income support mechanism. A person so excluded is
``debarred.''
* * * * *
(7) Suspension. An action taken by the Commission in accordance
with these regulations that immediately excludes a person from
activities associated with or relating to the schools and libraries
support mechanism, the high-cost support mechanism, the rural health
care support mechanism, and the low-income support mechanism for a
temporary period, pending completion of the debarment proceedings. A
person so excluded is ``suspended.''
* * * * *
(c) Causes for suspension and debarment. Causes for suspension and
debarment are conviction of or civil judgment for attempt or commission
of criminal fraud, theft, embezzlement, forgery, bribery, falsification
or destruction of records, making false statements, receiving stolen
property, making false claims, obstruction of justice and other fraud
or criminal offense arising out of activities associated with or
related to the schools and libraries support mechanism, the high-cost
support mechanism, the rural health care support mechanism, and the
low-income support mechanism.
(d) Effect of suspension and debarment. Unless otherwise ordered,
any persons suspended or debarred shall be excluded from activities
associated with or related to the schools and libraries support
mechanism, the high-cost support mechanism, the rural health care
support mechanism, and the low-income support mechanism. Suspension and
debarment of a person other than an individual constitutes suspension
and debarment of all divisions and/or other organizational elements
from participation in the program for the suspension and debarment
period, unless the notice of suspension and proposed debarment is
limited by its terms to one or more specifically identified
individuals, divisions, or other organizational elements or to specific
types of transactions.
(e) * * *
(2) * * *
(i) Give the reasons for the proposed debarment in terms sufficient
to put a person on notice of the conduct or transaction(s) upon which
it is based and the cause relied upon, namely, the entry of a criminal
conviction or civil judgment arising out of activities associated with
or related to the schools and libraries support mechanism, the high-
cost support mechanism, the rural health care support mechanism, and
the low-income support mechanism;
* * * * *
(3) A person subject to proposed debarment, or who has an existing
contract with a person subject to proposed debarment or intends to
contract with such a person to provide or receive services in matters
arising out of activities associated with or related to the schools and
libraries support mechanism, the high-cost support mechanism, the rural
health care support mechanism, and the low-income support mechanism may
contest debarment or the scope of the proposed debarment. A person
contesting debarment or the scope of proposed debarment must file
arguments and any relevant documentation within thirty (30) calendar
days of receipt of notice or publication in the Federal Register,
whichever is earlier.
(4) A person subject to proposed debarment, or who has an existing
contract with a person subject to proposed debarment or intends to
contract with such a person to provide or receive services in matters
arising out of activities associated with or related to the schools and
libraries support mechanism, the high-cost support mechanism, the rural
health care support mechanism, and the low-income support mechanism may
also contest suspension or the scope of suspension, but such action
will not ordinarily be granted. A person contesting suspension or the
scope of suspension must file arguments and any relevant documentation
within thirty (30) calendar days of receipt of notice or publication in
the Federal Register, whichever is earlier.
* * * * *
(g) Time period for debarment. A debarred person shall be
prohibited from involvement with the schools and libraries support
mechanism, the high-cost support mechanism, the rural health care
support mechanism, and the low-income support mechanism for three (3)
years from the date of debarment. The Commission may, if necessary to
protect the public interest, set a longer period of debarment or extend
the existing period of debarment. If multiple convictions or judgments
have been rendered, the Commission shall determine based on the facts
before it whether debarments shall run concurrently or consecutively.
0
5. Section 54.619 is amended by adding paragraph (d) to read as
follows:
Sec. 54.619 Audits and recordkeeping.
* * * * *
(d) Service providers. Service providers shall retain documents
related to the delivery of discounted telecommunications and other
supported services for at least 5 years after the last day of the
delivery of discounted services. Any other document that demonstrates
compliance with the statutory or regulatory requirements for the rural
health care mechanism shall be retained as well.
0
6. Section 54.702 is amended by adding paragraph (o) to read as
follows:
Sec. 54.702 Administrator's functions and responsibilities.
* * * * *
(o) The Administrator shall provide performance measurements
pertaining to the universal service support mechanisms as requested by
the Commission by order or otherwise.
0
7. Section 54.706 is amended by adding paragraph (e) to read as
follows:
[[Page 54219]]
Sec. 54.706 Contributions.
* * * * *
(e) Any entity required to contribute to the federal universal
service support mechanisms shall retain, for at least five years from
the date of the contribution, all records that may be required to
demonstrate to auditors that the contributions made were in compliance
with the Commission's universal service rules. These records shall
include without limitation the following: Financial statements and
supporting documentation; accounting records; historical customer
records; general ledgers; and any other relevant documentation. This
document retention requirement also applies to any contractor or
consultant working on behalf of the contributor.
0
8. Section 54.713 is revised to read as follows:
Sec. 54.713 Contributors' failure to report or to contribute.
(a) A contributor that fails to file a Telecommunications Reporting
Worksheet and subsequently is billed by the Administrator shall pay the
amount for which it is billed. The Administrator may bill a contributor
a separate assessment for reasonable costs incurred because of that
contributor's filing of an untruthful or inaccurate Telecommunications
Reporting Worksheet, failure to file the Telecommunications Reporting
Worksheet, or late payment of contributions. Failure to file the
Telecommunications Reporting Worksheet or to submit required quarterly
contributions may subject the contributor to the enforcement provisions
of the Act and any other applicable law. The Administrator shall advise
the Commission of any enforcement issues that arise and provide any
suggested response. Once a contributor complies with the
Telecommunications Reporting Worksheet filing requirements, the
Administrator may refund any overpayments made by the contributor, less
any fees, interest, or costs.
(b) If a universal service fund contributor fails to make full
payment on or before the date due of the monthly amount established by
the contributor's applicable Form 499-A or Form 499-Q, or the monthly
invoice provided by the Administrator, the payment is delinquent. All
such delinquent amounts shall incur from the date of delinquency, and
until all charges and costs are paid in full, interest at the rate
equal to the U.S. prime rate (in effect on the date of the delinquency)
plus 3.5 percent, as well as administrative charges of collection and/
or penalties and charges permitted by the applicable law (e.g., 31
U.S.C. 3717 and implementing regulations).
(c) If a universal service fund contributor is more than 30 days
delinquent in filing a Telecommunications Reporting Worksheet Form 499-
A or 499-Q, the Administrator shall assess an administrative remedial
collection charge equal to the greater of $100 or an amount computed
using the rate of the U.S. prime rate (in effect on the date the
applicable Worksheet is due) plus 3.5 percent, of the amount due per
the Administrator's calculations. In addition, the contributor is
responsible for administrative charges of collection and/or penalties
and charges permitted by the applicable law (e.g., 31 U.S.C. 3717 and
implementing regulations). The Commission may also pursue enforcement
action against delinquent contributors and late filers, and assess
costs for collection activities in addition to those imposed by the
Administrator.
(d) In the event a contributor fails both to file the Worksheet and
to pay its contribution, interest will accrue on the greater of the
amounts due, beginning with the earlier of the date of the failure to
file or pay.
(e) If a universal service fund contributor pays the Administrator
a sum that is less than the amount due for the contributor's universal
service contribution, the Administrator shall adhere to the ``American
Rule'' whereby payment is applied first to outstanding penalty and
administrative cost charges, next to accrued interest, and third to
outstanding principal. In applying the payment to outstanding
principal, the Administrator shall apply such payment to the
contributor's oldest past due amounts first.
[FR Doc. E7-18711 Filed 9-21-07; 8:45 am]
BILLING CODE 6712-01-P