**Before the**

**Federal Communications Commission**

**Washington, DC 20554**

In the Matter of )

)

Request for Review of the )

Decision of the )

Universal Service Administrator by )

)

General Communication, Inc. ) SPIN 143001199

Anchorage, Alaska )

)

Federal-State Joint Board on ) CC Docket No. 96-45

Universal Service )

)

Changes to the Board of Directors of the ) CC Docket No. 97-21

National Exchange Carrier Association, Inc. )

**order**

**Adopted: June 12, 2003 Released: June 13, 2003**

By the Wireline Competition Bureau:

1.  Before the Commission is a Request for Review by General
    Communication, Inc. (GCI), Anchorage, Alaska.[^1] GCI seeks review
    of the decision of the Schools and Libraries Division (SLD) of the
    Universal Service Administrative Company (Administrator), dismissing
    GCI's appeal to SLD as untimely.[^2] For the reasons set forth
    below, we affirm SLD's decision and deny the Request for Review.

2.  Under the schools and libraries universal service support mechanism,
    eligible schools, libraries, and consortia that include eligible
    schools and libraries, may apply for discounts for eligible
    telecommunications services, Internet access, and internal
    connections.[^3] The Commission's rules require that the applicant
    make a bona fide request for services by filing with the
    Administrator an FCC Form 470,[^4] which is posted to the
    Administrator's website for all potential competing service
    providers to review.[^5] After the FCC Form 470 is posted, the
    applicant must wait at least 28 days before entering an agreement
    for services and submitting an FCC Form 471, which requests support
    for eligible services.[^6] SLD reviews the FCC Forms 471 that it
    receives and issues funding commitment decisions in accordance with
    the Commission's rules.

3.  The dispositive issue here is the timeliness of GCI's appeal to SLD.
    However, because GCI's arguments that its pleading was timely rest
    on the fact that the duration of the schools and libraries
    mechanism's first funding "year," which began on January 1, 1998,
    was actually eighteen months, we first review how this circumstance
    arose. The Commission, when it initially established the mechanism
    in the *Universal Service Order*, concluded that the mechanism's
    funding year should correspond to the calendar year.[^7] In the
    *Fifth Order on Reconsideration*, released on June 22, 1998,
    however, the Commission changed the funding year from the calendar
    year to a fiscal year running from July 1 to June 30.[^8] To effect
    the transition between the calendar year basis of Funding Year 1998
    and the fiscal year basis of Funding Year 1999, the Commission
    directed that, for applications for discounts on telecommunications
    services and Internet access in Funding Year 1998, the Administrator
    should provide funding that exceeded the approved amount sufficient
    to fund the services at the approved monthly rate for the period
    between January 1, 1999 and June 30, 1999.[^9] In contrast, for
    applications seeking discounts on internal connections, the
    Commission directed the Administrator to commit only the originally
    approved amount of funding, but provided that these funds could be
    utilized during the transition period through June 30, 1999.[^10]

4.  At issue are 83 Funding Request Numbers (FRNs) in applications from
    fifteen Alaskan schools and school districts.[^11] Each FRN on
    appeal requested discounts in Funding Year 1998 on services
    characterized by the applicant as internal connections to be
    provided by GCI.[^12] The FRNs specifically sought discounts for the
    monthly charges for servers provided by GCI to the schools to
    support GCI's Internet access service.[^13] Each FRN specified
    monthly and total charges for the service.[^14]

5.  Between November 1998 and February 1999, SLD issued Funding
    Commitment Decision Letters on each of the pending applications,
    granting, with one exception, each appealed FRN in an amount equal
    to the total discount requested by the applicant in its FCC Form
    471, which covered only the costs in 1998.[^15] Subsequently, GCI
    realized that the Funding Commitment Decision Letters had not
    awarded additional discounts on these FRNs for the monthly costs of
    the servers during the first six months of 1999.[^16] GCI contacted
    SLD to determine why SLD had not awarded the additional discounts,
    and was informed that, under the terms of the *Fifth Order on
    Reconsideration*, only requests for telecommunications services and
    Internet access services were eligible for such additional
    funding.[^17]

6.  GCI then filed an appeal with SLD on July 7, 1999, arguing that the
    internal connections requests, because they involved recurring
    costs, should have been granted additional funding for the months
    from January to June, 1999.[^18] Shortly thereafter, SLD issued a
    decision in each of the affected applications, addressed to the
    applicant, not GCI, in which SLD dismissed the SLD Appeal as
    untimely because it was filed more than 30 days after the issuance
    of the relevant Funding Commitment Decision Letter.[^19]

7.  For requests seeking review of decisions issued before August 13,
    2001 under section 54.720 of the Commission's rules, an appeal must
    be filed with the Commission or SLD within 30 days of the issuance
    of the decision as to which review is sought.[^20] Documents are
    considered to be filed with the Commission or SLD only upon
    receipt.[^21]

8.  On January 11, 2001, having received no notice of the outcome of its
    appeal, GCI inquired with SLD to determine the status of the appeal,
    and, on March 1, 2001, was issued a decision informing it that the
    appeal had been treated as an "applicant appeal" and dismissed as
    untimely.[^22] GCI then filed the pending Request for Review.

9.  We first address the timeliness of the Request for Review before us.
    We find that, because the SLD Appeal was filed by GCI as an appeal
    on its own behalf, and because the Administrator's Decisions on
    Appeal were addressed to the applicants, not to GCI, the
    Administrator's Decisions on Appeal are not the relevant decisions
    on appeal for purposes of determining the timeliness of the instant
    Request for Review.[^23] Rather, the decision on appeal to the
    Commission is the e-mail notification issued to GCI on March 1,
    2001, informing GCI that the SLD Appeal had been dismissed.[^24] The
    Request for Review is therefore timely, and we proceed to review on
    the merits SLD's decisions to dismiss the SLD Appeal as
    untimely.[^25]

10. We find that GCI's SLD Appeal was filed more than 30 days after the
    issuance of each of the Funding Commitment Decision Letters on
    appeal.[^26] Therefore, we find that SLD correctly concluded that,
    for each Funding Commitment Decision Letter, the SLD Appeal was
    untimely under the Commission's regulations.[^27]

11. GCI argues that requiring it to respond within 30 days of the
    Funding Commitment Decision Letters violated its due process right
    to adequate notice because the Funding Commitment Decision Letters
    did not give it constitutionally sufficient notice that only 12
    months of internal connections service were being funded.[^28] GCI
    notes that, in the Funding Commitment Decision Letters, the FRNs at
    issue stated that the "funding status" was "COMMITTED-FULL" and that
    the FRNs had been "approved as submitted."[^29] GCI asserts that it
    had no notice from these statements that funding for the extension
    period had been denied or of the reasons for the denial, and that
    GCI did not receive adequate notice until SLD personnel explained in
    June of 1999 why SLD had not awarded additional internal connections
    funding.[^30] Because the Request for Review was filed within 30
    days of this notice, GCI argues, it must be found timely. As set
    forth below, however, we find that GCI's argument fails first,
    because GCI had no legal right to notice, and second, because the
    funding commitment decision letters provide adequate notice of SLD's
    funding decisions to those parties entitled to notice.

12. We are not persuaded by GCI's argument that the dismissal of the SLD
    Appeal violated GCI's due process rights. While the individual
    schools and libraries are entitled to adequate notice of a funding
    decision, service providers are not.[^31] The underlying interest in
    the discounts that gives rise to notice requirements involving
    Funding Commitment Decision Letters is solely that of the applicant
    schools and libraries, not that of indirect beneficiaries such as
    GCI. The applicants themselves received sufficient notice. The
    Funding Commitment Decision Letters specified the exact amount of
    funding awarded, which was equal to the total amount applicants
    requested in the FCC Forms 471 for the 12-month period of 1998, not
    the additional six-month period ending in June, 1999.[^32] It was
    therefore clear that SLD was awarding the amount requested and no
    more, and any applicant that felt that additional funding should
    have been awarded was given adequate notice of the need to appeal at
    that time.

13. Applicants frequently contract with a variety of different entities
    to provide discounted services, and ensuring that all service
    providers receive proper notice would be wasteful of limited program
    resources. Indeed, under GCI's rationale of notification for service
    providers, service providers' subcontractors might similarly be
    entitled to notice, as might the various schools within a school
    district where the district has applied for discounted services. We
    conclude that it is sufficient to provide notice directly to the
    applicant and allow the applicant to act on that notice if it so
    chooses. Because applicants ultimately receive the benefits of the
    support mechanism, or bear the burden of the loss of potential
    discounts, sufficient incentives exist for applicants to pursue any
    desired relief following notice.

14. GCI also argues that mere notice of the denial of extended funding
    was inadequate without a further discussion of the reason why such
    funding is denied, suggesting that the amount awarded might have
    been the result of a clerical error.[^33] However, as noted above,
    we find that the basis for the funding decision was sufficiently
    evident from the Funding Commitment Decision Letters to give
    applicants a meaningful opportunity to appeal. Further, to the
    extent that GCI argues that SLD was required to provide express
    notice in each affected funding decision of the terms of the *Fifth
    Order on Reconsideration*, we disagree. Here, the Commission
    determined in the *Fifth Order on Reconsideration* that internal
    connections requests should not receive any additional funds for the
    extension period. The Commission then published this decision in the
    Federal Register, providing legal notice to all parties.[^34]
    Therefore, SLD was not required to re-announce this policy in each
    affected Funding Year 1998 funding decision.

15. In sum, we conclude that SLD correctly found the SLD Appeal to be
    untimely, and uphold SLD's dismissal of the GCI's appeal.

16. ACCORDINGLY, IT IS ORDERED, pursuant to authority delegated under
    sections 0.91, 0.291, and 54.722(a) of the Commission's rules, 47
    C.F.R. §§ 0.91, 0.291, and 54.722(a), that the Request for Review
    filed by General Communication, Inc., Anchorage, Alaska, on March
    29, 2001, IS DENIED.

> FEDERAL COMMUNICATIONS COMMISSION
>
> Carol E. Mattey
>
> Deputy Chief, Wireline Competition Bureau
>
> APPENDIX A
>
> **[Applicant Name:]{.underline} [File No:]{.underline} [Funding
> Request Nos.:]{.underline}**
>
> Alaska Gateway School District 102570 117391, 117411, 117460
>
> Aleutian East Borough School District 70690 73774
>
> Bering Strait School District 35820 36679, 36746, 36784, 36848,
>
> 68750, 68798, 68877, 68913,
>
> 69024, 69087, 69134, 69265,
>
> 69314, 70369
>
> Delta-Greely School District 34217 34496, 34646
>
> Iditarod Area School District 16250 13186, 13193, 13236, 13252,
>
> 13262, 13265, 13269, 13274,
>
> 13279
>
> Lake and Peninsula School District 14089 11520
>
> Lower Yukon School District 7673 107386, 107407, 160826,
>
> 160833, 160841, 160852,
>
> 160867, 160873
>
> Mt. Edgecumbe High School 17098 14411
>
> Nenana City School District 109193 124643
>
> Northwest Arctic Borough School District 25442 24959, 24962, 24968,
> 24972,
>
> 24980, 24982, 24984, 24987,
>
> 24991, 25033
>
> Southwest Region School District 35567 36338, 36431, 36599, 36635,
>
> 36701, 36739, 36772, 36832,
>
> 36868, 36911
>
> Tanana City School District 15846 12379
>
> Yukon Flats School District 52918 98051, 98108, 98113, 98125,
>
> 98141, 98152, 98166, 98183,
>
> 98185, 98189
>
> Yukon-Koyukuk School District 30005 70423, 70499, 70673,
>
> 70865, 70902, 70925, 70983,
>
> 71002, 71035, 71055, 71081
>
> Yupiit School District 21246 19930

[^1]: *Request for Review of the Decision of the Universal Service
    Administrator by General Communication, Inc.*, CC Docket Nos. 96-45
    and 97-21, Request for Review, filed March 29, 2001 (Request for
    Review).

[^2]: *See* Request for Review. Section 54.719(c) of the Commission's
    rules provides that any person aggrieved by an action taken by a
    division of the Administrator may seek review from the Commission.
    47 C.F.R. § 54.719(c).

[^3]: 47 C.F.R. §§ 54.502, 54.503.

[^4]: Schools and Libraries Universal Service, Description of Services
    Requested and Certification Form, OMB 3060-0806 (FCC Form 470).

[^5]: 47 C.F.R. § 54.504(b); *Federal-State Joint Board on Universal
    Service*, CC Docket No. 96-45, Report and Order, 12 FCC Rcd 8776,
    9078, para. 575 (1997) (*Universal Service Order*), as corrected by
    *Federal‑State Joint Board on Universal Service*, CC Docket No.
    96‑45, Errata, FCC 97‑157 (rel. June 4, 1997), *affirmed in part*,
    *Texas Office of Public Utility Counsel v. FCC*, 183 F.3d 393 (5th
    Cir. 1999) (affirming *Universal Service First Report and Order* in
    part and reversing and remanding on unrelated grounds), *cert.
    denied, Celpage, Inc. v. FCC*, 120 S. Ct. 2212 (May 30, 2000),
    *cert. denied,* *AT&T Corp. v. Cincinnati Bell Tel. Co*., 120 S. Ct.
    2237 (June 5, 2000*), cert. dismissed,* *GTE Service Corp. v. FCC*,
    121 S. Ct. 423 (November 2, 2000).

[^6]: 47 C.F.R. § 54.504(b), (c); Schools and Libraries Universal
    Service, Services Ordered and Certification Form, OMB 3060-0806 (FCC
    Form 471).

[^7]: *Universal Service Order*, 12 FCC Rcd at 9057.

[^8]: *Federal-State Joint Board on Universal Service*, CC Docket No.
    96-45, Fifth Order on Reconsideration and Fourth Report and Order in
    CC Docket No. 96-45, 13 FCC Rcd 14915, para. 8 (1998) (*Fifth Order
    on Reconsideration*).

[^9]: *Id.*, para. 12.

[^10]: *Id.*, para. 13.

[^11]: The applicants, application numbers, and associated FRNs are
    listed in Appendix A.

[^12]: *See* Appendix A for a complete list of the applications and FRNs
    at issue.

[^13]: *See*, *e.g.*, FCC Form 471, Alaska Gateway School District,
    filed April 15, 1998 (Alaska Gateway Form 471), at FRN 117391; *see
    also* Request for Review at 2-3.

[^14]: *See*, *e.g.*, Alaska Gateway Form 471 at FRN 117391.

[^15]: *See* Letter from Schools and Libraries Division, Universal
    Service Administrative Company, to John Rusyniak, Alaska Gateway
    School District, dated February 25, 1999; Letter from Schools and
    Libraries Division, Universal Service Administrative Company, to
    Brett Hill, Lower Yukon School District, dated February 25, 1999;
    Letter from Schools and Libraries Division, Universal Service
    Administrative Company, to Chick Beckley, Aleutian East Borough
    School District, dated February 24, 1999; Letter from Schools and
    Libraries Division, Universal Service Administrative Company, to
    Greg Culbert, Yukon-Koyukuk School District, dated February 24,
    1999; Letter from Schools and Libraries Division, Universal Service
    Administrative Company, to Greg Johnson, Bering Strait School
    District, dated February 18, 1999; Letter from Schools and Libraries
    Division, Universal Service Administrative Company, to Dennis
    Niedermeyer, Lake & Peninsula School District, dated February 18,
    1999; Letter from Schools and Libraries Division, Universal Service
    Administrative Company, to Scott VonGemmingen, Yukon Flats School
    District, dated February 18, 1999; Letters from Schools and
    Libraries Division, Universal Service Administrative Company, to
    Isabelle Harrington, Iditarod Area School District, dated February 9
    and February 18, 1999 (February 18 Iditarod FCDL); Letters from
    Schools and Libraries Division, Universal Service Administrative
    Company, to Karl Kowalski, Northwest Arctic Borough School District,
    dated February 9 and February 18, 1999 (February 18 Northwest Arctic
    FCDL); Letter from Schools and Libraries Division, Universal Service
    Administrative Company, to John Weise, Yupiit School District, dated
    February 9, 1999; Letters from Schools and Libraries Division,
    Universal Service Administrative Company, to Jack Detzel,
    Delta-Greely School District, dated January 26 and February 18,
    1999; Letter from Schools and Libraries Division, Universal Service
    Administrative Company, to Hal Spackman, Mount Edgecumbe High
    School, dated January 19, 1999; Letter from Schools and Libraries
    Division, Universal Service Administrative Company, to Terry
    Bentley, Nenana City School District, dated January 19, 1999; Letter
    from Schools and Libraries Division, Universal Service
    Administrative Company, to Dave Piazza, Southwest Region School
    District, dated January 19, 1999; Letter from Schools and Libraries
    Division, Universal Service Administrative Company, to Richard
    Curtis, Tanana City School District, dated November 20, 1998
    (collectively, Funding Commitment Decision Letters).

    The exception, FRN 70499 in the application from Yukon-Koyukuk,
    seeking a 60% discount on internal connections, was denied on the
    grounds that the funding cap would not support internal connections
    for schools with less than a 62% discount. *See* February 28
    Iditarod FCDL. GCI does not address this denial or offer any reason
    for its failure to timely appeal the decision, nor does GCI dispute
    SLD's reasons for denying funding, and we therefore do not further
    address FRN 70499.

[^16]: Request for Review at 3.

[^17]: *Id.* at 3-4; *see also* E-mail from Gary Porter,
    <gporter@gci.com>, to Mickey Revenaugh, dated June 24, 1999
    (attached to Request for Review); E-mail from Robert Haga,
    <rhaga@universalservice.org>, to Gary Porter, dated June 24, 1999
    (attached to Request for Review).

[^18]: Letter from James R. Jackson, General Communication, Inc., to
    Schools and Libraries Committee, Universal Service Administrative
    Company, filed July 7, 1999 (SLD Appeal).

[^19]: *See*, *e.g.*, Letter from Schools and Libraries Division,
    Universal Service Administrative Company, to John Rusyniak, Alaska
    Gateway School District, dated July 13, 1999 (Alaska Gateway
    Administrator's Decision on Appeal).

[^20]: 47 C.F.R. § 54.720.

[^21]: 47 C.F.R. § 1.7.

[^22]: *See* E-mail from Mark Moderow, to
    <ewolfhagen@universalservice.org>, dated January 11, 2001 (attached
    to Request for Review); E-mail from
    <ewolfhagen@universalservice.org>, to <mmoderow@gci.com>, dated
    March 1, 2001 (attached to Request for Review).

[^23]: *See* Request for Review at 8; *see also* E-Mail from
    <ewolfhagen@universalservice.org>, to <mmoderow@gci.com>, dated
    March 1, 2001 (stating that "\[y\]our original appeal letter was
    treated as an 'applicant' appeal" and that "the letter(s) indicating
    that it was not timely filed" were sent only to the applicants).

[^24]: *Id.*; SLD Appeal.

[^25]: GCI submitted a Supplement to Request for Review. *See* *Request
    for Review of the Decision of the Universal Service Administrator by
    General Communication, Inc.*, CC Docket Nos. 96-45 and 97-21,
    Request for Review, filed August 3, 2001 (Supplement). The
    Supplement fails to raise substantive arguments that were not
    presented in the Request for Review.

[^26]: *Compare* Funding Commitment Decision Letters (dating between
    November 20, 1998 and February 25, 1999) *with* SLD Appeal (filed
    July 7, 1999).

[^27]: 47 C.F.R. § 54.720(a); *see also* *Request for Review by
    Massachusetts Department of Education, Federal-State Joint Board on
    Universal Service, Changes to the Board of Directors of the National
    Exchange Carrier Association, Inc.*, File No. SLD-149217, CC Dockets
    No. 96-45 and 97-21, Order, 16 FCC Rcd 7768, para. 14 (Com. Car.
    Bur. 2001) (stating that, under Commission rules, SLD is required to
    dismiss as untimely any appeal filed more than 30 days after the
    issuance of the decision being appealed).

[^28]: Request for Review at 6-8.

[^29]: Request for Review at 7. Subsequently (after funding had been
    distributed), the funding status was changed to "funded." *See*
    Northwest Arctic Funding Commitment Decision Letter. We note that in
    two applications, FRNs were specified as "471 approved; modified by
    SLC." *See* February 18 Iditarod FCDL (FRNs 13186, 13236, 13252,
    13262, 13269, 13274, and 13193); February 18 Northwest Arctic FCDL
    (FRNs 24959, 24963, 24968, 24972, 24980, 24982, 24984, 24987, 24991,
    and 25003). However, the actual amount approved was the amount
    requested in the applicant's original FCC Form 471. *Id.*

[^30]: Request for Review at 7-8.

[^31]: Procedural due process protections do not extend to those who
    suffer merely indirect harms from the government action*. See
    O'Bannon v. Town Court Nursing Center*, 447 U.S. 773, 787-88 (1980);
    *Ridder v. Office of Thrift Supervision*, 146 F.3d 1035, 1041 (D.C.
    Cir. 1998).

[^32]: *See* *supra* note 15.

[^33]: Request for Review at 7-8.

[^34]: *See* 63 Fed. Reg. 43088, 43089 (August 12, 1998) (6-month
    extension applies to telecommunications and Internet access only).