[Federal Register Volume 75, Number 66 (Wednesday, April 7, 2010)]
[Rules and Regulations]
[Pages 17584-17590]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-7757]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Part 54
[CC Docket No. 02-6; FCC 09-105]
Schools and Libraries Universal Service Support Mechanism
AGENCY: Federal Communications Commission.
ACTION: Final rule.
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SUMMARY: In this document, the Federal Communications Commission
(Commission) addresses matters related to the eligibility of products
and services under the schools and libraries universal service support
mechanism, also known as the E-rate program. First, in the Report and
Order, the Commission modifies its rules to expressly include
interconnected voice over Internet protocol (VoIP) and text messaging
as eligible services under the E-rate program. Second, in the process
of releasing the list of services that will be eligible for discounts
for E-rate funding year 2010, the Commission clarifies the E-rate
program eligibility of video on-demand servers, ethernet, web hosting,
wireless local area network (LAN) controllers, and virtualization
software. It also finds that telephone broadcast messaging, unbundled
warranties, power distribution units, softphones, interactive white
boards, and e-mail archiving are ineligible for E-rate program funding.
DATES: Effective May 7, 2010.
FOR FURTHER INFORMATION CONTACT: Cara Voth, Wireline Competition
Bureau, Telecommunications Access Policy Division, (202) 418-7400 or
TTY: (202) 418-0484.
SUPPLEMENTARY INFORMATION: This is a synopsis of the Commission's
Report and Order in CC Docket No. 02-6, FCC 09-105, adopted December 1,
2009, and released December 2, 2009. The complete text of this document
is available for inspection and copying during normal business hours in
the FCC Reference Information Center, Portals II, 445 12th Street, SW.,
Room CY-A257, Washington, DC 20554. The document may also be purchased
from the Commission's duplicating contractor, Best Copy and Printing,
Inc., 445 12th Street, SW., Room CY-B402, Washington, DC 20554,
telephone (800) 378-3160 or (202) 863-2893, facsimile (202) 863-2898,
or via the Internet at http://www.bcpiweb.com. It is also available on
the Commission's Web site at http://www.fcc.gov.
People with Disabilities: To request materials in accessible
formats for people with disabilities (braille, large print, electronic
files, audio format), send an e-mail to [email protected] or call the
Consumer & Governmental Affairs Bureau at 202-418-0530 (voice), 202-
418-0432 (tty).
Synopsis of the Report and Order
I. Introduction
1. In the Report and Order, we conclude that interconnected VoIP
service is eligible for E-rate support and should continue to be an
eligible service under the E-rate program. We also conclude that text
messaging is eligible for E-rate support. In response to the 2010 ESL
Public Notice, we clarify the E-rate program eligibility of video on-
demand servers, ethernet, web hosting, wireless local area network
(LAN) controllers, and virtualization software. We find that telephone
broadcast messaging, unbundled warranties, power distribution units,
softphones, interactive white boards, and e-mail archiving are
ineligible for E-rate program funding. Finally, we release the Eligible
Services List (ESL) for E-rate funding year 2010.
II. Background
2. Under the E-rate program, eligible schools, libraries, and
consortia that include eligible schools and libraries may receive
discounts for eligible telecommunications services, Internet access,
and internal connections. Section 254 of the Communications Act of
1934, as amended (the Act), gives the Commission the authority to
designate ``telecommunications services'' and certain additional
services eligible for support under the E-rate program. The Commission
may also designate services eligible for E-rate support as part of its
authority to enhance, to the extent technically feasible and
economically reasonable, access to advanced telecommunications and
information services for all public and non-profit elementary and
secondary school classrooms and libraries.
3. Since the initial implementation of the E-rate program in 1998,
and consistent with the Commission's rules and requirements, USAC has
developed procedures and guidelines to ensure that E-rate funding is
provided only for eligible services. Initially, the Commission directed
USAC, in consultation with the Commission, to determine whether
particular services fell within the eligibility criteria established
under the Act and the Commission's rules and policies. USAC began to
update and post to its Web site on an annual basis a list of services
and products eligible to receive discounts under the E-rate program,
now known as the ESL. In consultation with the Wireline Competition
Bureau (Bureau), USAC updated the list to reflect any
[[Page 17585]]
changes in rules that had occurred during the previous year and to
address issues that arose in the application review process.
4. On December 23, 2003, the Commission adopted section 54.522 of
its rules, formalizing the process for updating the ESL for the E-rate
program. Specifically, under section 54.522 of the Commission's rules,
the Commission must seek comment on USAC's proposed ESL and issue a
public notice attaching the final ESL for the upcoming funding year at
least 60 days prior to the opening of the application funding window
for the E-rate program. In its current form, the ESL is divided into
five main categories--telecommunications service, Internet access,
internal connections, basic maintenance of internal connections, and
miscellaneous.
5. In the 2010 ESL Public Notice, the Bureau sought comment on
changes to the ESL proposed by USAC for funding year 2010. Comments on
the 2010 ESL Public Notice were due on June 23, 2009, and reply
comments were due on June 30, 2009. In the ESL NPRM, released in July
2008, the Commission sought comment on issues related to eligible
services that had been raised by commenters but had not yet been
resolved through the ESL public notice and revision process. For
example, the Commission sought comment on the inclusion of
interconnected VoIP service in the ESL, and whether text messaging,
telephone broadcast messaging, and other individual services should be
eligible for E-rate support under section 254(c)(3) of the Act. The
Commission also sought comment on which rules, if any, would need to be
amended to implement any changes made as a result of the ESL NPRM.
Comments on the ESL NPRM were due on September 18, 2008, and reply
comments were due on October 3, 2008.
III. Discussion
A. Designation of Additional Supported Services
6. In this Report and Order, we modify our rules to expressly
include interconnected VoIP and text messaging as eligible services
under the E-rate program.
7. Interconnected VoIP We conclude that we should modify our rules
to expressly include interconnected VoIP as a service eligible for E-
rate support, and we will continue to fund interconnected VoIP service
under the E-rate support mechanism. We also determine that
interconnected VoIP service should be a Priority 1 service because
regardless of its ultimate regulatory classification, it is defined as
``enabl[ing] real-time, two-way voice communications,'' 47 CFR 9.3, and
thus provides basic connectivity akin to other Priority 1 services. We
note, however, that not all of the components of an interconnected VoIP
service are eligible for Priority 1 funding. Any components of an
interconnected VoIP system that would be considered internal
connections would be eligible for Priority 2 funding only, and any
components of an interconnected VoIP system that are end-user equipment
are ineligible for funding. We also adopt USAC's proposal that
interconnected VoIP be listed in both the telecommunications and
Internet access categories of the ESL, despite the fact that the
Commission has not yet determined the regulatory classification of
interconnected VoIP.
8. We find that, pursuant to section 254 of the Act, the Commission
has the authority to include interconnected VoIP service as an
additional service eligible for E-rate support. We therefore amend
section 54.503 of our rules to designate interconnected VoIP as a
supported special service. We note that the Commission has not yet
classified interconnected VoIP service as either a telecommunications
service or an information service. If interconnected VoIP service is
found to be a telecommunications service, sections 254(c)(1), (c)(3),
and (h)(1)(B) of the Act provide the Commission with the authority to
provide E-rate support for all commercially available
telecommunications services. 47 U.S.C. 254(c)(1), (c)(3). If, however,
interconnected VoIP is determined to be an information service,
sections 254(c)(3), (h)(1)(B), and (h)(2) of the Act, as explained in
the Universal Service First Report and Order, provide the Commission
with the authority to provide E-rate support for interconnected VoIP
when provided by both telecommunications carriers and non-
telecommunications carriers because such support will ``enhance * * *
access to advanced telecommunications and information services'' for
schools and libraries. 47 U.S.C. 254(c)(3), (h)(1)(B), (h)(2)(A). No
matter how interconnected VoIP is ultimately classified, we find that
the Commission has statutory authority to include it as an eligible
supported service. Therefore, we amend section 54.517 of our rules to
permit interconnected VoIP to be provided by non-telecommunications
carriers.
9. Furthermore, we agree with commenters that the permanent
inclusion of interconnected VoIP service increases the options
available to schools and libraries to encourage meaningful
communications among parents, teachers, and school and library
administrators. Indeed, because interconnected VoIP is increasingly
used to replace analog voice service, funding interconnected VoIP
service is consistent with the concept of competitive neutrality, which
is the principle of treating similarly situated services in the same
manner for E-rate funding purposes, as mandated by the Commission. We
also agree with commenters that the inclusion of interconnected VoIP
service as an eligible service allows schools and libraries to benefit
from the same cost efficiencies and service features that have led many
consumers and businesses to choose this technology.
10. We also sought comment on whether interconnected VoIP service
should remain classified in the miscellaneous service category, as it
has been in previous ESLs. As proposed by USAC in its annual ESL
submission, we conclude that interconnected VoIP service should be
listed in both the telecommunications and Internet access categories to
help minimize applicant confusion noted by commenters. We clarify that
we are not, by this action, ultimately determining that interconnected
VoIP is either a telecommunications service or an Internet access
service. Rather, we put interconnected VoIP in both of those ESL
categories because interconnected VoIP can be provided by both
telecommunications service providers or non-telecommunications service
providers. Because of this change, it will no longer be necessary to
list interconnected VoIP in the miscellaneous category of the ESL. We
believe this change will also clarify that applicants can apply for and
receive E-rate funding for interconnected VoIP service provided by
either a telecommunications service provider or an Internet access
service provider. We encourage applicants soliciting bids for
interconnected VoIP services to post for the services in both
categories to expand the number of service providers that can bid on
the services sought. Consistent with USAC's recommendation, we clarify
that applicants are not required to prepare a technology plan if they
are seeking discounts only for interconnected VoIP. Thus, we amend
section 54.504(b) of our rules to make clear that no technology plan is
needed if applicants are applying only for interconnected VoIP.
11. We also agree with Funds for Learning that any interconnected
VoIP hardware that does not meet the test for Priority 1 services in
the Tennessee
[[Page 17586]]
Order should be considered Priority 2 internal connections and should
be ineligible for Priority 1 funding. In the Tennessee Order, the
Commission stated that a service is considered a component of internal
connections if it is necessary to ``transport information within one or
more instructional buildings of a single school campus.'' The
Commission also stated that it was reasonable to presume that if
facilities are located on an applicant's premises, then such facilities
are necessary to transport information within one or more buildings of
the school campus, and are thus a Priority 2 internal connections
service and not part of an end-to-end Internet access service, i.e., a
Priority 1 service. This presumption can be rebutted with evidence that
the applicant does not own or have exclusive use of the facilities.
Thus, leased VoIP telephone systems will need to be evaluated in
accordance with the conditions in the Tennessee Order, to determine
whether they should be eligible as Priority 2 internal connections only
or if some portion of the system would be eligible as Priority 1. For
example, only the lease of a single basic terminating component is
eligible as a Priority 1 service under E-rate and this may include a
VoIP gateway device located on the applicant's premises, but hubs,
routers and switches are not considered basic terminating components
and would be subject to the on-premise Priority 1 equipment conditions
set forth in the Tennessee Order.
12. In the ESL NPRM, we also sought comment on whether applicants
requesting funding for interconnected VoIP service as an Internet
access service must comply with and certify to requirements identified
in the Children's Internet Protection Act (CIPA). 47 U.S.C. 254(h)(5),
(l). Enacted in 2001, CIPA imposed requirements on schools and
libraries ``having computers with Internet access'' and prohibits
schools and libraries from receiving discounted services if those
requirements are not met. 47 U.S.C. 254(h)(5), (h)(6). This prohibition
is not applicable to a school or library that receives discounted
services ``only for purposes other than the provision of Internet
access, Internet service, or internal connections.'' 47 U.S.C.
254(h)(5)(A)(ii), (h)(6)(A)(ii). Thus, the Commission determined that
schools or libraries receiving only discounted telecommunications
services were not required to comply with CIPA. Consistent with the
majority of commenters' arguments, we conclude that applicants
requesting funds for interconnected VoIP service alone are not required
to comply with and certify to CIPA requirements. While interconnected
VoIP service may traverse the Internet, interconnected VoIP service, by
definition, is not used to provide an Internet access service, Internet
service, or internal connections. 47 CFR 9.3. Therefore, we find that
CIPA compliance is not required for applicants that receive funding for
interconnected VoIP service. Applicants seeking support for
interconnected VoIP service that also seek support for Internet access,
Internet service, or internal connections would certify their CIPA
compliance separately for the Internet access.
13. Text Messaging. We find that we should modify our rules to
include text messaging, known as short message service (SMS), as a
service eligible for E-rate support. We agree with commenters who noted
that text messaging is similar to other E-rate-eligible services used
by applicants to communicate, such as e-mail and paging services.
Moreover, we believe our decision to add text messaging is analogous to
our decision in the Schools and Libraries Second Report and Order to
add voice mail service to the list of E-rate-eligible services. Thus,
for similar reasons, we designate text messaging as a service eligible
for E-rate support. We note that we include text messaging as an
eligible service irrespective of whether text message is ultimately
categorized as a telecommunications service or an information service.
This service will be categorized in the ESL in the telecommunications
service category as a component of telephone service because text
messaging has generally been available in conjunction with wireless
telephone service, and the charges for text messaging are typically
bundled with wireless telephone service or the separate charges for the
text messaging service appear on the same bill as the telephone
service. We therefore amend section 54.503 of our rules to designate
text messaging as a supported special service.
14. We remind applicants that text messaging is eligible for E-rate
support when used for educational purposes only. The Commission had
established a presumption that activities that occur in a library or
classroom or on library or school property are integral, immediate, and
proximate to the education of students or the provision of library
services to library patrons. We caution applicants that for purposes of
the E-rate program, eligible text messaging would not include
applications, software or other special features that, for example, are
used to facilitate the mass distribution of text messages, or the
creation or management of distribution groups for text messaging.
B. Clarifications Regarding the Eligibility for Support of Services in
the Funding Year 2010 ESL
15. We also release the ESL for E-rate funding year 2010 and make
findings about the particular changes to the ESL recommended by USAC.
Specifically, we clarify the eligibility of video on-demand servers,
ethernet, Web hosting, wireless LAN controllers, VoIP-related services,
and virtualization software. We also find that telephone broadcast
messaging, unbundled warranties, power distribution units, softphones,
interactive white boards, and e-mail archiving are ineligible for E-
rate program funding.
16. Video On-Demand Servers. Although USAC had proposed to make
``video on-demand servers'' ineligible in their entirety, we clarify
that applicants can continue to receive E-rate discounts as internal
connections for the portion of a video on-demand server that enables
the transport of video to the classroom or parts of a library. The
portion of a video on-demand server that enables the storage of video
or other content, however, would remain ineligible. To clarify the
eligibility status of a video on-demand server, we add the term ``video
content storage'' to the list of ineligible storage components on the
ESL. This should more clearly delineate the portion of a video on-
demand server that is ineligible for discounts. Currently, applicants
are using servers that house video for various purposes, including
transporting information over a wide area network (WAN) or LAN to
classrooms from a central server. We note that there may be video on-
demand servers that are primarily dedicated to the storage of video and
other content and the cost-allocation used by the manufacturer should
accurately reflect the true use of the server. We also caution
applicants that duplicative products or services are ineligible. If
applicants are using other products or services to transport video or
information throughout their school or library buildings, the portion
of a video on-demand server that also provides this capability will be
considered duplicative and ineligible.
17. Ethernet. We clarify that ethernet is an eligible digital
transmission technology in the telecommunications funding category of
the ESL. Ethernet technology provides a network that connects
computers. Although traditionally associated with local area
[[Page 17587]]
networks, technology has evolved such that ethernet networks can span
large distances and can provide connections from within an eligible
school or library to other locations beyond the school or library.
Therefore, we find that for purposes of the E-rate program, ethernet
service is eligible in the telecommunications funding category. We
agree with commenters who state that adding ethernet to the ESL
``reflects the evolution of telecommunications technologies that are
commercially available and is a clarification of previous
eligibility.'' We also note that although it was not specifically
listed in the ESL for funding year 2009, ethernet is a type of digital
transmission service that has been eligible for E-rate discounts when
purchased as a Priority 1 telecommunications service.
18. Web hosting. We clarify that web pages protected by a username
and password are eligible for funding as part of web hosting services.
The fact that a school or library restricts access to all or part of
its Web site to certain users--e.g., school administrators, teachers,
librarians and students--does not render the service ineligible for E-
rate funds. Web hosting has been on the ESL since funding year 2004, as
Internet access. We emphasize that an eligible Web hosting service is
limited to hosting a school or library's Web site--software
applications, end-user file storage, and content editing features are
still ineligible components of a web hosting service. Such ineligible
web hosting features would include, but would not be limited to, the
posting of content created by third party vendors, any type of
interactive application feature that would allow for blogging, and any
features involving data input or retrieval including searching of
databases for grades, student attendance files, or other reports. We
caution applicants that they must cost-allocate these types of
ineligible features. The clarification to allow funding for web pages
protected by a username and password was intended to allow school
administrators, parents, students, and library employees to view web
pages that, may, for various reasons, need to be restricted from
viewing by the rest of the public. This clarification was not intended
to allow applicants to obtain funding for additional web hosting-
related applications and features beyond the service that enables a
school or library to have hosted web pages, including any application
software or features that may be required to maintain password
protected Web pages.
19. Wireless LAN Controllers. We agree with USAC that wireless LAN
controllers should be specifically listed in the ESL as eligible
internal connections under the data distribution category. A wireless
LAN controller is a device that is a central component of a wireless
network solution and that helps to manage the large-scale deployment of
a wireless network. In its proposed changes to the ESL for E-rate
funding year 2010, USAC proposes to include a definition of a wireless
LAN controller as a component that is used in conjunction with access
points to create a wireless local area network. USAC defines an
``access point'' as a base station in a wireless LAN and states that
access points are typically stand-alone devices that may plug into an
ethernet hub or server or may provide a repeater function for wireless
networks. When a school or library is relying on a wireless network
solution, wireless LAN controllers, in conjunction with access points,
are necessary for the delivery of information all the way to the
classrooms of the school or rooms of the library. Under the E-rate
program, internal connections components are those that are necessary
to ``transport information within one or more instructional buildings
of a single school campus or within one or more non-administrative
buildings that comprise a single library branch.'' Wireless LAN
controllers, therefore, are eligible for support under the E-rate
program as internal connections. Applicants have been receiving support
for wireless LAN controllers as eligible internal connections and this
change to the ESL is merely a clarification of the service's existing
funding status.
20. Interconnected VoIP-Related Software. We agree with USAC that
we should clarify that funding for user licenses for VoIP systems are
eligible server based software and can be requested in the internal
connections funding category. Interconnected VoIP user licenses are
necessary for the utilization of the VoIP system. They are similar to
client access licenses for eligible software products, except that they
are specific to VoIP systems. Client access licenses are currently
eligible for E-rate funding. Commenters agree with the proposed
clarification, noting that applicants have received funding for these
services in prior funding years.
21. Virtualization Software. We agree with USAC that virtualization
software is eligible for E-rate support as internal connections. As
stated above, under the E-rate program, internal connections components
are those that are necessary to ``transport information within one or
more instructional buildings of a single school campus or within one or
more non-administrative buildings that comprise a single library
branch.'' USAC's draft ESL for funding year 2010 states that
virtualization software allows for the creation of multiple virtual
servers on a single server, essentially allowing the work of multiple
servers to be performed on one server. We agree with Funds for Learning
that virtualization software should be eligible for E-rate funding when
it is used for eligible server functions. Moreover, one of the internal
connections for which the E-rate program provides discounts is
operating system software, which enables the basic operations of a
computer system or other electronic device. We find that virtualization
software is a type of operating system software. Applicants can use
virtualization software to transport information within its school or
library, and, in so doing, would be using a single server to perform
the tasks of what would usually take multiple servers. Thus,
virtualization software may be a cost-effective technology for
applicants and is eligible for E-rate funding. If applicants also use
virtualization software for functions that are ineligible for E-rate
support, such as archiving, functions that support ineligible
applications, or network management, the applicants must perform a cost
allocation to remove the ineligible functions from their E-rate funding
requests.
22. Telephone Broadcast Messaging. We agree with USAC that
telephone broadcast messaging should not be added to the ESL because we
find that it does not fit within any of the current categories of
supported services. A broadcast messaging service is one that can call
hundreds or thousands of recipients and play a pre-recorded message
from school administrators about information including, but not limited
to, weather delays or closings, school absences, or child safety
issues. Broadcast messaging has been described by commenters as an add-
on to voice mail service and an application riding on top of a service
provider's telecommunications infrastructure. Only a few categories of
software are eligible for E-rate funding, however, including operating
system software, e-mail software, and software for a server-based,
shared voice mail system. While voice mail has been designated as an
eligible service, and the E-rate program pays for the software for a
server-based shared voice mail system, the record in the ESL NPRM
proceeding established that telephone broadcast messaging is an ``add-
on to voice mail'' service and not software for voice mail itself.
Therefore, we find that broadcast
[[Page 17588]]
messaging consists of applications or features that do not fit into any
of the current categories of supported services and thus, should not be
added to the list of software applications that are currently eligible
for support as internal connections. Moreover, we find that it would
not be in the public interest to add telephone broadcast messaging to
the ESL when requests for E-rate funding consistently exceed the
funding cap. While we believe that many school districts find telephone
broadcast messaging a useful service, we do not believe it is essential
to the educational purposes of schools and libraries, and funding this
service may have an adverse effect on funds available for other already
eligible services.
23. Unbundled Warranties. We find that unbundled warranties are not
services eligible for E-rate discounts as basic maintenance of internal
connections. In its proposed changes to the ESL, USAC proposes to add
unbundled warranty to the basic maintenance category of the ESL and
defines ``unbundled warranty'' as a separately priced warranty allowing
for broken equipment to be fixed or, in the event that the problem is
beyond repair, replaced. The Commission has found that basic
maintenance services are eligible for universal service support as
Priority 2 internal connections service if, but for the maintenance at
issue, the internal connection would not function and serve its
intended purpose with the degree of reliability ordinarily provided in
the marketplace to entities receiving such services. We do not add
unbundled warranties to the ESL at this time because we find that a
warranty may be duplicative of an applicant's maintenance agreement or
contract, which is eligible for E-rate discounts. To avoid the
potential waste of E-rate resources, we decline to allow applicants to
receive E-rate discounts for duplicative unbundled warranties.
Moreover, the current ESL states that basic maintenance is eligible for
discount only if it is a component of a maintenance agreement or
contract for eligible components. An unbundled warranty would not be a
component of a maintenance agreement or contract for eligible
components. Therefore, we find that an unbundled warranty is not
eligible for E-rate funds as basic maintenance.
24. Power Distribution Units. We agree with USAC that the ESL
should be updated to clearly state that power distribution units are
not eligible for E-rate support as internal connections. USAC proposes
to define a ``power distribution unit'' as a power strip designed for
data centers or racks with greater capacity and features than a power
strip, and a ``power strip'' as a group of sockets that allow for
multiple power cords to plug into a single device. Power strips have
not previously been eligible for E-rate funding and, because a power
distribution unit is merely a type of power strip with additional
capacities and features, we find that it is also ineligible for E-rate
program funds.
25. Softphones. We agree with USAC's proposal to clarify in the ESL
that softphones are software that is ineligible for E-rate funding. The
Commission has approved operating system software, e-mail software, and
software for a server-based, shared voice mail system as eligible
software under the internal connections funding category for E-rate.
USAC proposes to define a softphone as end-user application software
that allows users the use of a personal computer's microphone and
speakers to make telephone calls in place of a physical end-user
telephone. This type of application software is unlike the types of
software the Commission has previously approved for E-rate funding and,
as commenters note, softphones perform the same functions as physical
desktop telephones, which are end-user equipment and are not eligible
for E-rate funding.
26. Interactive White Boards. We agree with USAC and commenters
that the ESL should clarify that interactive white boards are end-user
equipment that is ineligible for E-rate funding. End-user equipment,
such as desktop telephones, personal computers, fax machines, and
modems, for example, is not eligible for E-rate discounts. In its draft
ESL for funding year 2010, USAC defines an ``interactive white board''
as a device that allows end-users to display information with a vast
array of interactive features. We find, therefore, that interactive
white boards are end-user equipment that is not eligible for E-rate
funding.
27. E-mail Archiving. We agree with USAC's proposal to clarify in
the ESL that e-mail archiving is an ineligible component of an e-mail
service. In addition, we agree with USAC's clarification to the draft
ESL for funding year 2010 that, for purposes of E-rate support, storage
products may be used for eligible e-mail files but not for e-mail
archiving. USAC's draft ESL for funding year 2010 defines e-mail
archiving as a form of electronic recordkeeping, often compressing e-
mail files to make available greater in-box space. For example, when e-
mail is archived to reduce in-box size, reduce hard drive space, and
retain records for future retrieval, it constitutes the storage of end-
user files and is ineligible for E-rate discounts. Although E-rate
eligible e-mail services can include a short-term storage component
that enables the user to view current e-mails, any long-term storage
service is ineligible for E-rate discounts and we agree with USAC that
this distinction should be made clear to applicants in the 2010 ESL.
Procedural Matters
Final Regulatory Flexibility Act Certification
28. The Regulatory Flexibility Act (RFA), see 5 U.S.C. 603,
requires that an agency prepare a regulatory flexibility analysis for
notice-and-comment rulemaking proceedings, unless the agency certifies
that ``the rule will not, if promulgated, have a significant economic
impact on a substantial number of small entities.'' See 5 U.S.C.
605(b). The RFA generally defines ``small entity'' as having the same
meaning as the terms ``small business,'' ``small organization,'' and
``small governmental jurisdiction.'' 5 U.S.C. 601(6). In addition, the
term ``small business'' has the same meaning as the term ``small
business concern'' under the Small Business Act. 5 U.S.C. 601(3). 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). 15 U.S.C. 632.
29. In the report and order, we modify our rules to expressly
include interconnected voice over Internet protocol (VoIP) and text
messaging as eligible services in our rules governing the E-rate
program. We also release the list of services that will be eligible for
discounts for E-rate funding year 2010. This Eligible Services List
(ESL) is released on an annual basis to enable school and library
applicants and other affected entities to determine the services and
products that are eligible for E-rate discounts. In the report and
order we add services to the ESL but do not remove any services from
the list. Thus, the only changes made in our report and order result in
the ability of schools and libraries to seek E-rate discounts for more
services than were available to them in the prior funding year. This
means that the rule revisions will result in a positive net impact on
small entities. Therefore, we certify that the requirements of the
report and order will have no significant economic impact.
30. The Commission will send a copy of the report and order,
including a copy
[[Page 17589]]
of this Final Regulatory Flexibility Certification, in a report to
Congress pursuant to the Congressional Review Act. See 5 U.S.C.
801(a)(1)(A). In addition, the report and order (or summary thereof)
and this final certification will be published in the Federal Register,
and will be sent to the Chief Counsel for Advocacy of the U.S. Small
Business Administration. See 5 U.S.C. 605(b).
Paperwork Reduction
31. This report and order does not contain proposed information
collection(s) subject to the Paperwork Reduction Act of 1995 (PRA),
Public Law 104-13. In addition, therefore, it does not contain any new
or modified ``information collection burden for small business concerns
with fewer than 25 employees,'' pursuant to the Small Business
Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C.
3506(c)(4).
Congressional Review Act
32. The Commission will send a copy of this Report and Order [CC
Docket No. 02-6; FCC 09-105] in a report to Congress and the Government
Accountability Office pursuant to the Congressional Review Act, see
U.S.C. 801(a)(1)(A).
Ex Parte Presentations
33. These matters shall be treated as a ``permit-but-disclose''
proceeding in accordance with the Commission's ex parte rules. 47 CFR
1.1200 through 1.1216. Persons making oral ex parte presentations are
reminded that memoranda summarizing the presentations must contain
summaries of the substance of the presentations and not merely a
listing of the subjects discussed. More than a one or two sentence
description of the views and arguments presented is generally required.
47 CFR 1.1206(b)(2). Other requirements pertaining to oral and written
presentations are set forth in section 1.1206(b) of the Commission's
rules. 47 CFR 1.1206(b).
Ordering Clauses
34. It is ordered, that pursuant to the authority contained in
sections 1 through 4, 201-205, 254, 303(r), and 403 of the
Communications Act of 1934, as amended, 47 U.S.C. 151-154, 201 through
205, 254, 303(r), and 403, this report and order is adopted.
35. It is further ordered, that pursuant to the authority contained
in sections 1 through 4, 201-205, 254, 303(r), and 403 of the
Communications Act of 1934, as amended, 47 U.S.C. 151-154, 201 through
205, 254, 303(r), and 403, sections 54.503, 54.507, and 54.517 of the
Commission's rules, 47 CFR 54.503, 54.507 and 54.517, is amended,
effective May 7, 2010.
36. It is further ordered that the Commission's Consumer and
Governmental Affairs Bureau, Reference Information Center, shall send a
copy of this report and order, including the Final Regulatory
Flexibility Certification, to the Chief Counsel for Advocacy of the
Small Business Administration.
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:
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), 201, 205, 214, and 254 unless
otherwise noted.
0
2. Section 54.503 is revised to read as follows:
Sec. 54.503 Other supported special services.
For the purposes of this subpart, other supported special services
provided by telecommunications carriers include voice mail,
interconnected voice over Internet protocol (VoIP), text messaging,
Internet access, and installation and maintenance of internal
connections in addition to all reasonable charges that are incurred by
taking such services, such as state and federal taxes. Charges for
termination liability, penalty surcharges, and other charges not
included in the cost of taking such services shall not be covered by
the universal service support mechanisms.
0
3. Section 54.504 is amended by revising paragraph (b)(2)(iv) to read
as follows:
Sec. 54.504 Requests for services.
* * * * *
(b) * * *
(2) * * *
(iv) The technology plan(s) has/have been approved by a state or
other authorized body; the technology plan(s) will be approved by a
state or other authorized body; or no technology plan needed because
the applicant is applying for voice mail, interconnected voice over
Internet protocol (VoIP), or basic local, cellular, PCS, or long
distance telephone service only.
* * * * *
0
4. Section 54.507 is amended by revising paragraphs (g) introductory
text, (g)(1)introductory text, (g)(1)(i) through (iii) (the note
remains unchanged) to read as follows:
Sec. 54.507 Cap.
* * * * *
(g) Rules of priority. The Administrator shall act in accordance
with paragraph (g)(1) of this section with respect to applicants that
file an FCC Form 471, as described in Sec. 54.504(c) of this part,
when a filing period described in paragraph (c) of this section is in
effect. The Administrator shall act in accordance with paragraph (g)(2)
of this section with respect to applicants that file an FCC Form 471,
as described in Sec. 54.504(c) of this part, at all times other than
within a filing period described in paragraph (c) of this section.
(1) When the filing period described in paragraph (c) of this
section closes, the Administrator shall calculate the total demand for
support submitted by applicants during the filing period. If total
demand exceeds the total support available for that funding year, the
Administrator shall take the following steps:
(i) The Administrator shall first calculate the demand for services
listed under the telecommunications and Internet access categories on
the eligible services list for all discount levels, as determined by
the schools and libraries discount matrix in Sec. 54.505(c). These
services shall receive first priority for the available funding.
(ii) The Administrator shall then calculate the amount of available
funding remaining after providing support for the telecommunications
and Internet access categories for all discount levels. The
Administrator shall allocate the remaining funds to the requests for
support for internal connections, beginning with the most economically
disadvantaged schools and libraries, as determined by the schools and
libraries discount matrix in Sec. 54.505(c) of this part. Schools and
libraries eligible for a 90 percent discount shall receive first
priority for the remaining funds, and those funds will be applied to
their requests for internal connections.
(iii) To the extent that funds remain after the allocation
described in Sec. Sec. 54.507(g)(1)(i) and (ii), the
[[Page 17590]]
Administrator shall next allocate funds toward the requests for
internal connections submitted by schools and libraries eligible for an
80 percent discount, then for a 70 percent discount, and shall continue
committing funds for internal connections in the same manner to the
applicants at each descending discount level until there are no funds
remaining.
* * * * *
0
5. Section 54.517 is amended by revising paragraph (b) to read as
follows:
Sec. 54.517 Services provided by non-telecommunications carriers.
* * * * *
(b) Supported services. Non-telecommunications carriers shall be
eligible for universal service support under this subpart for providing
interconnected voice over Internet protocol (VoIP), voice mail,
Internet access, and installation and maintenance of internal
connections.
* * * * *
[FR Doc. 2010-7757 Filed 4-6-10; 8:45 am]
BILLING CODE 6712-01-P