**Before the**

**Federal Communications Commission**

**Washington, D.C. 20554**

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| In the Matter of                 | *  | File No. EB-04-IH-0522       |
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| Teletronics, Inc.                | ** | NAL/Acct. No. 200532080138   |
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**NOTICE OF APPARENT LIABILITY**

**FOR FORFEITURE AND ORDER**

**Adopted: July 25, 2005 Released: July 25, 2005**

By the Commission:

# I. INTRODUCTION 

1.  In this Notice of Apparent Liability for Forfeiture ("NAL"), we find
    that Teletronics, Inc. ("Teletronics"), a telecommunications carrier
    that has been operating and at least indirectly benefiting from
    federal programs supporting the telecommunications industry for
    years, apparently failed to meet its statutory and regulatory
    obligations related to those programs. Based upon our review of the
    facts and circumstances surrounding this matter, we conclude that
    Teletronics is apparently liable for a total forfeiture of
    \$692,000.

2.  Specifically we find Teletronics has apparently violated sections
    64.1195(a) of the Commission's rules by willfully and repeatedly
    failing to register with the Commission from April 2, 2001 to the
    current date.[^1] We also conclude that Teletronics has apparently
    violated 54.711(a), 64.604(c)(5)(iii)(B), and 52.17(b) of our rules
    by failing to submit certain Telecommunications Reporting Worksheets
    from 1999 to the current date. [^2] We further find that Teletronics
    has apparently violated sections 254(d) and 251(e)(2) of the
    Communications Act of 1934, as amended (the "Act"),[^3] and sections
    54.706(a), 64.604(c)(5)(iii)(A) and 52.17(a) of the Commission's
    rules by willfully and repeatedly failing to contribute to the
    Universal Service Fund ("USF"), Telecommunications Relay Service
    ("TRS") Fund, and cost recovery mechanisms for North American
    Numbering Plan Administration ("NANPA").[^4] Finally, we find that
    Teletronics has apparently violated sections 1.1154 and 1.1157(b)(1)
    of the Commission's rules by willfully and repeatedly failing to pay
    regulatory fees to the Commission.[^5]

3.  We order Teletronics to submit within thirty days, either as part of
    its response to this NAL or separately, a report, supported by a
    sworn statement or declaration under penalty of perjury of a
    corporate officer, setting forth in detail its plan to come into
    compliance with the relevant payment and reporting rules discussed
    herein. We further order Teletronics to file with the Universal
    Service Administrative Company ("USAC") within thirty days all
    Annual Telecommunications Reporting Worksheets required under the
    Commission's rules from the date Teletronics began providing
    telecommunications service in the United States to the date of this
    NAL.[^6]

# II. BACKGROUND

4.  Teletronics, Inc., also doing business as Telectronics Services,
    Inc., is an Ohio-based telecommunications provider that offers
    integrated telecommunications systems to business users. [^7] In
    1999, it began reselling intrastate, interstate, and international
    long-distance service purchased from MCI and other carriers as part
    of its packaged offerings.[^8]

5.  The Commission is charged by Congress with regulating interstate and
    international telecommunications and ensuring that providers of such
    telecommunications comply with the requirements imposed on them by
    the Act and our rules.[^9] The Commission also has been charged by
    Congress to establish, administer and maintain various
    telecommunications regulatory programs, which are described in more
    detail below, and to fund these programs through assessments on the
    telecommunications providers that benefit from them. To accomplish
    these goals, the Commission established "a central repository of key
    facts about carriers" through which it could monitor the entry and
    operation of interstate telecommunications providers to ensure,
    among other things, that they are qualified, do not engage in fraud,
    and do not evade oversight.[^10] First and foremost, Commission
    rules require that, upon entry or anticipated entry into
    telecommunications markets, telecommunications carriers must
    register by submitting information on an FCC Form 499-A, also known
    as a Telecommunications Reporting Worksheet ("Annual Worksheet" or
    "Form 499-A"). The Commission requires telecommunications providers
    to submit financial information on the Worksheets to enable the
    Commission to determine and collect the statutorily mandated
    assessments.[^11]

6.  The Telecommunications Act of 1996 codified Congress's historical
    commitment to promote universal service to ensure that consumers in
    all regions of the nation have access to affordable, quality
    telecommunications services.[^12] In particular, section 254(d) of
    the Act requires, among other things, that "\[e\]very
    telecommunications carrier \[providing\] interstate
    telecommunications services . . . contribute, on an equitable and
    nondiscriminatory basis, to the specific, predictable, and
    sufficient mechanisms established by the Commission to preserve and
    advance universal service."[^13] In implementing this Congressional
    mandate, the Commission directed all telecommunications carriers
    providing interstate telecommunications services and certain other
    providers of interstate telecommunications to contribute to the
    Universal Service Fund based upon their interstate and international
    end-user telecommunications revenues.[^14] Failure by some providers
    to pay their share into the Fund skews the playing field by giving
    non-paying providers an economic advantage over their competitors,
    who must then shoulder more than their fair share of the costs of
    the Fund.

7.  Section 225(b)(1) of the Act, which codifies Title IV of the
    Americans with Disabilities Act of 1990, directs the Commission to
    "ensure that interstate and intrastate telecommunications relay
    services are available, to the extent possible and in the most
    efficient manner, to hearing-impaired and speech-impaired
    individuals in the United States."[^15] To that end, the Commission
    established the TRS Fund to reimburse TRS providers for the costs of
    providing interstate telecommunications relay services.[^16]
    Pursuant to section 64.604(c)(5)(iii)(A) of the Commission's rules,
    every carrier that provides interstate telecommunications services
    must contribute to the TRS Fund based upon their interstate end-user
    revenues.[^17]

8.  In addition, section 251(e)(1) of the Act directs the Commission to
    oversee the administration of telecommunications numbering to ensure
    the availability of telephone numbers on an equitable basis.[^18]
    Section 251(e)(2) of the Act requires that "\[t\]he cost of
    establishing telecommunications numbering administration
    arrangements . . . be borne by all telecommunications carriers on a
    competitively neutral basis as determined by the Commission."[^19]
    In carrying out this statutory directive, the Commission adopted
    section 52.17 of its rules, which requires, among other things, that
    all telecommunications carriers contribute toward the costs of
    numbering administration on the basis of their end-user
    telecommunications revenues for the prior calendar year.[^20]

9.  Finally, pursuant to section 9(a)(1) of the Act and section 1.1151
    of the Commission's rules, interstate telecommunications carriers
    and other providers must pay regulatory fees to the Commission to
    cover the costs of certain regulatory activities.[^21] In
    particular, sections 1.1154 and 1.1157(b)(1) of the Commission's
    rules require that interstate telecommunications carriers pay
    regulatory fees on the basis of their interstate and international
    end-user revenues.[^22] Such fees must be paid on an annual
    basis,[^23] and failure to do so subjects a carrier to late payment
    penalties, as well as possible revocation of its operating
    authority.[^24] Further, under the Commission's "red light rule,"
    action will be withheld on any application to the Commission or
    request for authorization made by any entity that has failed to pay
    when due its regulatory fees or any other program payment, such as
    USF contributions, and if payment or payment arrangements are not
    made within 30 days from notice to the applicant, such applications
    or requests will be dismissed.[^25]

10. The Commission has established specific procedures to administer the
    programs for universal service, telecommunications relay services,
    numbering administration and regulatory fees. The requirement to
    register discussed above is essential to the fulfillment of the
    universal service and other program missions because it identifies
    the company as potentially subject to various program requirements
    and enables the program administrators to oversee the company's
    compliance with those requirements. Upon submission of a Form 499-A
    registration, the carrier is issued a filer identification number by
    USAC, which is then associated with further filings by the company
    and is used to track the carrier's contributions and invoices.

11. In addition to its obligation to register, a carrier is required to
    file Worksheets for the purpose of determining its USF, TRS, NANPA,
    and regulatory fee program payments, and, with certain exceptions,
    to file quarterly short-form Worksheets to determine monthly
    universal service contribution amounts. These periodic filings
    trigger a determination of liability, if any, and subsequent billing
    and collection, by the entities that administer the regulatory
    programs. For example, USAC uses the revenue projections submitted
    on the quarterly filings to determine each carrier's universal
    service contribution amount.[^26] Carriers are required to pay their
    monthly USF contribution by the date shown on their invoice.[^27]
    The Commission's rules explicitly warn contributors that failure to
    file their forms or submit their payments potentially subjects them
    to enforcement action.[^28] The TRS Administrator, the NANPA Billing
    and Collection agent, and the Commission use the prior year's
    revenue information provided on the Annual Worksheet to determine
    amounts owed for the TRS, NANPA, and regulatory fee programs,
    respectively.[^29]

12. In 2004, the Enforcement Bureau ("Bureau") audit staff sought to
    identify resellers of telecommunications service that failed to
    register as telecommunications service providers with the Commission
    and, thus, may also have failed to satisfy various Commission
    program requirements.[^30] To identify such resellers, the Bureau
    audit staff compared lists of resellers provided by wholesale
    service providers against the Commission's central repository of
    registered telecommunications service providers with filer
    identification numbers. If a reseller did not appear to have an
    identification number, the audit staff sent an inquiry to that
    reseller. On March 30, 2004 and June 18, 2004, the Bureau's audit
    staff sent letters to Teletronics requesting information pertaining
    to its compliance with the Commission's registration
    requirement.[^31] On August 17, 2004, following correspondence
    between Teletronics' counsel and audit staff clarifying the nature
    of Teletronics' filing obligations, Teletronics' counsel told a
    staff auditor in a telephone conversation that Teletronics would
    file a Worksheet by September 16, 2004.[^32] To the date of this
    NAL, Teletronics has not yet registered or filed any initial, annual
    or quarterly Worksheets.

13. The Bureau, on October 28, 2004, issued a letter of inquiry ("LOI")
    directing Teletronics, among other things, to submit a sworn written
    response to a series of questions relating to Teletronics' apparent
    failure to satisfy its registration, filing and payment
    obligations.[^33] Teletronics filed its responses on November 24,
    2004, and January 3, 2005.[^34] The Teletronics November 24 Letter
    confirms that Teletronics did not file any Worksheets or make any
    contributions or regulatory fee payments.[^35]

# III. DISCUSSION

14. Under section 503(b)(1)(B) of the Act, any person who is determined
    by the Commission to have willfully or repeatedly failed to comply
    with any provision of the Act or any rule, regulation, or order
    issued by the Commission shall be liable to the United States for a
    forfeiture penalty.[^36] To impose such a forfeiture penalty, the
    Commission must issue a notice of apparent liability, the notice
    must be received, and the person against whom the notice has been
    issued must have an opportunity to show, in writing, why no such
    forfeiture penalty should be imposed.[^37] The Commission will then
    issue a forfeiture if it finds by a preponderance of the evidence
    that the person has violated the Act or a Commission rule.[^38] As
    set forth below, we conclude under this standard that Teletronics is
    apparently liable for a forfeiture for its apparent willful and
    repeated violations of sections 254(d) and 251(e)(2) of the Act[^39]
    and sections 64.1195(a), 54.711(a), 64.604(c)(5)(iii), 52.17,
    54.706(a), 1.1154, and 1.1157(b)(1) of the Commission's rules.[^40]

15. The fundamental issues in this case are whether Teletronics
    apparently violated the Act and the Commission's rules by: (1)
    willfully or repeatedly failing to register with the Commission; (2)
    willfully or repeatedly failing to file Telecommunications Reporting
    Worksheets; (3) willfully or repeatedly failing to make requisite
    contributions toward the Universal Service and TRS Funds, and NANPA
    cost recovery mechanisms; and (4) willfully or repeatedly failing to
    pay regulatory fees to the Commission. We answer these questions
    affirmatively. Based on a preponderance of the evidence, therefore,
    we conclude that Teletronics is apparently liable for a forfeiture
    of \$692,000 for apparently willfully and repeatedly violating
    sections 254(d) and 251(e)(2) of the Act[^41] and sections
    64.1195(a), 54.711(a), 64.604(c)(5)(iii), 52.17, 54.706(a), 1.1154,
    and 1.1157(b)(1) of the Commission's rules.[^42]

16. Specifically we propose the following forfeitures for apparent
    violations within the last year: (1) \$100,000 for failure to
    register; (2) \$250,000 for failure to file five annual or quarterly
    Telecommunications Reporting Worksheets; (3) \$308,000 for failure
    to make any monthly USF contributions; (4) \$14,000 for failure to
    pay the 2004 TRS Fund contribution; (5) \$10,000 for failure to make
    its 2005 NANPA contribution; and (6) \$10,000 for failure to make
    its 2004 regulatory fee program payment. Although we propose
    forfeitures only for apparent violations within the last year, we
    discuss below the history of Teletronics' noncompliance in prior
    years as useful background and to demonstrate the scope of
    Teletronics' misconduct.

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A.  **Registration with the Commission**

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17. We conclude that Teletronics has apparently violated section
    64.1195(a) of the Commission's rules by willfully and repeatedly
    failing to register with the Commission from 2001 to the
    present.[^43] Teletronics' failure to register constitutes a clear
    violation of a vital Commission rule. Section 64.1195(a) of the
    Commission's rules unambiguously requires that all carriers that
    provide, or plan to provide, interstate telecommunications services
    register with the Commission by submitting specified
    information.[^44] Although Teletronics began to resell interstate
    and international service at some point in 1999, it has never
    registered by filing an initial Telecommunications Reporting
    Worksheet since the effective date of that obligation, April
    2, 2001. It has persisted in this failure even after it received the
    Bureau's March 30 Audit Letter and June 18 Audit Letter. Moreover,
    it specifically represented through counsel to the Bureau staff
    auditor that it would register by September 16, 2004, yet it
    admitted in the Teletronics November 24 Letter that it had not
    registered. As a direct result of this misconduct, Teletronics has
    operated for years without participation in any of the programs tied
    to registration.[^45]

18. We view Teletronics' failure to register since April 2, 2001 as a
    serious violation of its responsibilities under the Act and our
    rules. A carrier's compliance with the Commission's registration
    requirement is central to the administration of the Universal
    Service, TRS and NANPA programs, collection of regulatory fees, and
    accomplishment of Congress' objectives in sections 9(a)(1), 254(d),
    225(b)(1), and 251(e) of the Act. As we noted above, a carrier's
    duty to register upon entry, or anticipated entry, into interstate
    telecommunications markets is essential to the fulfillment of the
    USF and other program missions because it identifies the company to
    the various program administrators and brings the company within the
    purview and oversight of these administrators. If a carrier never
    identifies itself as a telecommunications provider by properly
    registering under the Commission's rules, then neither the
    Commission nor the various program administrators can ascertain
    whether that carrier has fulfilled other regulatory obligations,
    including the requirement that carriers file Worksheets and
    contribute to USF, TRS, NANPA and regulatory fee programs. Moreover,
    the program administrators have no basis upon which to invoice the
    carrier for contributions. A telecommunications carrier that fails
    to register thus can operate outside of the Commission's oversight
    and evade its federal obligations to contribute toward the vital
    programs linked to registration. Based on a preponderance of the
    evidence, therefore, we find that Teletronics has apparently
    violated section 64.1195(a) of the Commission's rules by willfully
    and repeatedly failing to register with the Commission.

19. Teletronics has failed to cure this apparent violation despite the
    Bureau's repeated inquiries. We note that, to the extent Teletronics
    refuses to comply with the Commission's rules on a going-forward
    basis, it may subject itself to additional enforcement action. In
    addition, we note that, to the extent Teletronics is found to be
    delinquent on any debt owed to the Commission (e.g., has failed to
    pay all of its USF contributions), the Commission will not act on,
    and may dismiss, any application or request for authorization filed
    by Teletronics, in accordance with the agency's "red light"
    rules.[^46]

    **B. Submission of Telecommunications Reporting Worksheets**

20. We conclude that Teletronics has apparently violated sections
    54.711(a), 64.604(c)(5)(iii)(B) and 52.17(b) of the Commission's
    rules by willfully and repeatedly failing to file annual and
    quarterly Telecommunications Reporting Worksheets. Teletronics has
    violated these rules since 1999 when it began providing
    telecommunications service.[^47]

21. Sections 54.711(a), 64.604(c)(5)(iii)(B) and 52.17(b) of the
    Commission's rules each clearly establish a carrier's obligation to
    file periodic Telecommunications Reporting Worksheets. [^48] A
    carrier's failure to file these Worksheets as required has serious
    implications for the USF, TRS, NANPA and regulatory fee programs. As
    we noted above, the filing of a Telecommunications Reporting
    Worksheet prompts a determination of liability for, and subsequent
    billing and collection of, regulatory fees and contributions by the
    various administrators of the Universal Service and TRS Funds, and
    NANPA cost recovery mechanisms. With regard to universal service in
    particular, the failure of a carrier such as Teletronics to abide by
    its federal filing obligation has a direct and profound detrimental
    impact on universal service by removing from the base of
    contributions telecommunications revenues that otherwise should be
    included, thereby shifting to compliant carriers additional economic
    burdens associated with universal service.[^49] Consequently, a
    carrier's failure to file required Worksheets frustrates the very
    purpose for which Congress enacted section 254(d) -- to ensure that
    every interstate carrier "contribute, on an equitable and
    nondiscriminatory basis, to the specific, predictable, and
    sufficient mechanisms established by the Commission to preserve and
    advance universal service."[^50] Viewed in this context, the
    Telecommunications Reporting Worksheet is not simply an
    administrative tool, but a fundamental and critical component of the
    Commission's universal service, TRS, NANPA and regulatory fee
    programs.

22. Since the date Teletronics began providing interstate and
    international telecommunications service in 1999, it had an
    obligation to file annual and quarterly Telecommunications Reporting
    Worksheets in order to participate in the applicable USF, TRS, NANPA
    and regulatory fee programs. Moreover, Teletronics has failed to
    cure these deficiencies despite the Bureau's repeated contacts.
    Based on a preponderance of the evidence, therefore, we find that
    Teletronics has apparently violated sections 54.711(a),
    64.604(c)(5)(iii)(B) and 52.17(b) of the Commission's rules by
    willfully and repeatedly failing to file annual and quarterly
    Telecommunications Reporting Worksheets, since it began providing
    telecommunications service in 1999, to the date of this NAL. The NAL
    proposes a forfeiture for Teletronics' failure to file the
    worksheets due August 1 and November 1, 2004 and February 1, April
    1, and May 1, 2005.

    **C. Failure to Make Universal Service Contributions**

23. We further conclude that Teletronics has apparently violated section
    254(d) of the Act and section 54.706(a) of the Commission's rules by
    willfully or repeatedly failing to make any contributions to
    universal service support mechanisms.[^51] Section 54.706(c) of the
    Commission's rules unambiguously directs that "entities
    \[providing\] interstate telecommunications to the public . . . for
    a fee . . . contribute to the universal service support
    programs."[^52] "Interstate telecommunications" include, among other
    things, "resale of interstate services" such as those provided by
    Teletronics.[^53] During the relevant period, Teletronics was
    required, pursuant to section 54.706(b) of the Commission's rules,
    to contribute to universal service mechanisms based upon either its
    historical or projected revenues.[^54] Teletronics admits, however,
    that it has not made any universal service payments.[^55] As we
    previously have stated:

    \[c\]arrier nonpayment of universal service contributions undermines
    the efficiency and effectiveness of the universal service support
    mechanisms. Moreover, delinquent carriers may obtain a competitive
    advantage over carriers complying with the Act and our rules. We
    consider universal service nonpayment to be a serious threat to a
    key goal of Congress and one of the Commission's primary
    responsibilities.[^56]

    Since Teletronics admits it has not made any universal service
    payments, we find that it has apparently violated section 254(d) of
    the Act and section 54.706(a) of the Commission's rules by willfully
    and repeatedly failing to make required universal service
    contributions, including twelve such failures within the past year
    which are the subject of this NAL.

    **D.** **Failure to Make Telecommunications Relay Service
    Contributions**

24. We also find that Teletronics has apparently violated section
    64.604(c)(5)(iii)(A) of the Commission's rules by willfully and
    repeatedly failing to make any required contributions to the
    interstate TRS Fund.[^57] As an interstate telecommunications
    carrier, Teletronics was obligated to contribute to the TRS Fund on
    the basis of its interstate end-user telecommunications
    revenues.[^58] A carrier's contribution to the TRS Fund is based
    upon its subject revenues for the prior calendar year and a
    contribution factor determined annually by the Commission.[^59]
    Subject carriers must make TRS contributions on an annual basis,
    with certain exceptions.[^60] By its own admission, Teletronics has
    not made any TRS payments.[^61] We therefore find that it has
    apparently violated section 64.604(c)(5)(iii)(A) of the Commission's
    rules by willfully and repeatedly failing to make required TRS
    contributions, including one such failure in the past year which is
    the subject of this NAL.

    **E. Failure to Make Numbering Administration Contributions**

25. We further find that Teletronics has apparently violated section
    251(e)(2) of the Act and section 52.17(a) of the Commission's
    rules[^62] by willfully and repeatedly failing to make any required
    contributions toward the costs of numbering administration As a
    telecommunications carrier, Teletronics was obligated to contribute
    to NANPA cost recovery mechanisms on the basis of its end-user
    telecommunications revenues during this period.[^63] As Teletronics
    admits, it has not made any NANPA payments.[^64] We therefore
    conclude that it has apparently violated section 251(e)(2) of the
    Act and section 52.17(a) of the Commission's rules by willfully and
    repeatedly failing to make required NANPA contributions, including
    one such failure in the past year which is the subject of this NAL.

    **F. Failure to Pay Regulatory Fees**

26. We finally conclude that Teletronics has apparently violated
    sections 1.1154 and 1.1157(b)(1) of the Commission's rules[^65] by
    willfully and repeatedly failing to pay required regulatory fees to
    the Commission on the basis of its interstate and international
    end-user revenues. As Teletronics acknowledges, it has not paid any
    regulatory fees.[^66] We therefore find that it has apparently
    violated sections 1.1154 and 1.1157(b)(1) of the Commission's rules
    by willfully and repeatedly failing to pay required regulatory fees,
    including one such failure in the last year which is the subject of
    this NAL.

    **G. Proposed Forfeiture**

27. Section 503(b)(1)(B) of the Act provides that any person that
    willfully or repeatedly fails to comply with any provision of the
    Act or any rule, regulation, or order issued by the Commission,
    shall be liable to the United States for a forfeiture penalty.[^67]
    For the apparent violations in this case, section 503(b)(2)(B) of
    the Act authorizes the Commission to assess a forfeiture of up to
    \$120,000 for each violation or each day of a continuing violation,
    up to a statutory maximum of \$1.2 million for a single act or
    failure to act for violations occurring before September 7, 2004,
    and up to \$130,000 for each violation or each day of a continuing
    violation, up to a statutory maximum of \$1.325 million for a single
    act or failure to act for violations occurring on or after September
    7, 2004.[^68] In determining the appropriate forfeiture amount, we
    consider the factors enumerated in section 503(b)(2)(D) of the Act,
    including "the nature, circumstances, extent and gravity of the
    violation, and, with respect to the violator, the degree of
    culpability, any history of prior offenses, ability to pay, and such
    other matters as justice may require."[^69]

28. Under section 503(b)(6) of the Act, we may only propose forfeitures
    for apparent violations that accrued within one year of the date of
    this NAL.[^70] Nevertheless, section 503 does not bar us from
    assessing whether Teletronics' conduct prior to that time period
    apparently violated the Act or our rules in determining the
    appropriate forfeiture amount for those violations within the
    statute of limitations.[^71] Therefore, although we find that
    Teletronics apparently violated the Act and our rules in multiple
    years, we propose forfeitures here only for violations that occurred
    within the last year.

29. In contrast to previous cases in which we have taken enforcement
    action for failure to satisfy universal service obligations,[^72]
    this case involves a carrier that has never registered and submitted
    any periodic Telecommunications Reporting Worksheets from the time
    it commenced providing telecommunications service until the present,
    in this case a period of over five years. These failures have
    continued notwithstanding the Bureau's multiple notifications to
    Teletronics and Teletronics' own acknowledgement of its obligations
    and omissions. Thus, we find Teletronics' failure to register to be
    particularly egregious. As we stated above, registration is
    fundamental to the implementation of our central repository of
    carriers and to the administration of multiple statutorily-derived
    programs --- the Universal Service Fund, the Telecommunications
    Relay Service Fund, North American Numbering Plan Administration
    cost recovery mechanisms, and the regulatory fee program. Where, as
    here, a carrier ignores its obligations by wholly failing to
    register, it undermines the programs and thwarts the purposes for
    which Congress and the Commission established them.

30. The Commission's *Forfeiture Policy Statement* and implementing
    rules prescribe a base forfeiture of \$3,000 for failure to file
    required forms or information.[^73] In the past, we have held that a
    substantial upward adjustment to \$50,000 is warranted for a
    carrier's failure to file its Telecommunications Reporting
    Worksheets for revenue reporting purposes.[^74] We find that failure
    to register is an even more egregious violation. By ignoring its
    registration obligation, Teletronics not only has violated our rules
    with significant ramifications for federal telecommunications
    policies, but has also hampered efficient and effective Commission
    enforcement by delaying detection of, and action against, its
    behavior. Moreover, carriers' failure to register imposes a
    substantial burden on the Commission, which can only identify such
    carriers through compliance review programs that require significant
    amounts of staff time and resources. This egregious behavior strikes
    at the core of our ability to implement and enforce the Act and our
    rules effectively, thus warranting a substantial forfeiture. Taking
    into account all of the factors enumerated in section 503(b)(2)(D)
    of the Act, we conclude that a proposed forfeiture of \$100,000 for
    willful and repeated failure to register is warranted.

31. We find that Teletronics' willful and repeated failure to file
    periodic Telecommunications Reporting Worksheets is also egregious.
    As we noted above, a carrier's obligation to file these Worksheets
    is directly linked to, and thus has serious implications for,
    administration of the USF, TRS, NANPA and regulatory fee programs.
    By ignoring its reporting obligations, Teletronics has unilaterally
    shifted to compliant carriers and their customers the economic costs
    associated with the universal service, TRS and NANPA programs,
    despite the fact that it has enjoyed many of the benefits derived
    from them. As noted above, in the past, the Commission has proposed
    a forfeiture of \$50,000 for failure to file quarterly and annual
    Worksheets.[^75] Accordingly, we find that Teletronics is apparently
    liable for a \$250,000 forfeiture for its failure to file its annual
    and four quarterly Worksheets within the past year.

32. Based on the facts above, it also appears that Teletronics has
    failed to make any requisite contributions into the Universal
    Service Fund since 1999. Nonpayment of universal service
    contributions is an egregious offense that bestows on delinquent
    carriers an unfair competitive advantage by shifting to compliant
    carriers the economic costs and burdens associated with universal
    service. A carrier's failure to make required universal service
    contributions hampers realization of Congress' policy objective in
    section 254(d) of the Act to ensure the equitable and
    non-discriminatory distribution of universal service costs among all
    telecommunications providers.[^76] The Commission has established a
    base forfeiture amount of \$20,000 for each month in which a carrier
    has failed to make any required universal service
    contributions.[^77] Teletronics has admitted that it has not made
    any contributions to USF. Consequently, we find that Teletronics is
    apparently liable for a base forfeiture of \$240,000 for its failure
    to make any universal service contributions within the past 12
    months. That base amount is, however, subject to an upward
    adjustment.

33. In the past, we have calculated upward adjustments to forfeitures
    for failure to make USF and TRS payments based on a percentage of
    the company's unpaid contributions.[^78] In situations such as this
    one, however, where the subject company has failed to file any
    information, we cannot determine the full amount owed to the funds
    until and unless the subject company provides complete and accurate
    information to the fund administrators. Thus, our ability to
    calculate and assess accurately an upward adjustment based on a
    percentage of unpaid contribution amounts can be inhibited by the
    violator. In such circumstances, companies that comply with our
    registration and filing requirements might be worse off than those,
    like Teletronics, that appear to ignore them. Such a result is not
    only unfair, but is bad public policy. During the course of our
    investigation, however, we received some revenue information that we
    will use to estimate the amount Teletronics should have paid in USF
    contributions since it began operations (approximately \$135,000)
    for purposes of calculating an upward adjustment of about half of
    that amount. Therefore, we propose an upward adjustment of \$68,000
    for Teletronics' apparent nonpayment violations, taking into account
    all the factors enumerated in section 503(b)(2)(D) of the Act, and
    particularly Teletronics' telecommunications service revenue and
    ability to pay. We thus find Teletronics liable for a total proposed
    forfeiture of \$308,000 for its apparent willful and repeated
    failure to make contributions into the Universal Service Fund.

34. We also find that Teletronics has apparently failed to make any TRS
    contributions since 1999. Where a carrier fails to satisfy its TRS
    obligations for an extended period of time, it thwarts the purpose
    for which Congress established section 225(b)(1) of the Act and its
    implementing regulations --- to ensure that telecommunications relay
    services "are available to the extent possible and in the most
    efficient manner, to hearing-impaired and speech-impaired
    individuals in the United States."[^79] The Commission has
    established a base forfeiture amount of \$10,000 for each instance
    in which a carrier fails to make required TRS contributions.[^80] In
    light of Teletronics' failure to satisfy any TRS obligations since
    1999, including the one for 2004, we find it apparently liable for a
    forfeiture in the amount of \$10,000. For the reasons discussed
    above regarding Teletronics' failure to make universal service
    contributions, and consistent with past Commission precedent,[^81]
    we find that an upward adjustment in an amount approximately one
    half of the carrier's estimated unpaid contributions (approximately
    \$8,000) is appropriate for Teletronics' apparent failure to make
    TRS contributions. Taking into account the factors enumerated in
    section 503(b)(2)(D) of the Act, we conclude that a \$4,000 upward
    adjustment is reasonable. Consequently, we find Teletronics liable
    for a total proposed forfeiture of \$14,000 for its willful and
    repeated failure to satisfy its TRS obligations for 2004.

35. We further conclude that Teletronics apparently failed to make any
    contributions toward NANPA cost recovery mechanisms on the basis of
    its actual end-user telecommunications revenues since 1999. As with
    universal service and TRS, the failure of carriers to make required
    NANPA contributions for an extended period of time severely hampers
    the Commission's ability to ensure that the cost of establishing
    telecommunications numbering administration arrangements are "borne
    by all telecommunications carriers on a competitively neutral basis"
    as Congress envisioned.[^82] The Commission has not prescribed a
    base forfeiture amount for failure to pay NANPA contributions. We
    find that this violation is similar to the failure to pay required
    TRS contributions, which are relatively smaller than universal
    service contributions. Consequently, we find that Teletronics is
    apparently liable for a forfeiture of \$10,000.

36. Finally, we conclude that Teletronics has apparently failed to make
    any regulatory fee payments to the Commission on the basis of its
    actual interstate and international end-user telecommunications
    revenues since 1999. A carrier's failure to contribute toward the
    costs of certain regulatory activities from which it benefits
    undermines the efficiency, equitability, and effectiveness of the
    regulatory fee program and accomplishment of Congress' objectives in
    section 9(a)(1) of the Act. The Commission has not established a
    base forfeiture amount for failure to pay regulatory fees.
    Regulatory fee obligations, however, are similar to TRS
    contributions in that they are due annually and are assessed at
    similar rates.[^83] For this reason, we find that a base forfeiture
    in the amount of \$10,000 for failure to make required regulatory
    fee payments is appropriate. We, therefore, find Teletronics
    apparently liable for a \$10,000 forfeiture for its apparent
    violation of sections 1.1154 and 1.1157 of the Commission's rules.

    **IV. CONCLUSION**

37. In light of the seriousness, duration and scope of the apparent
    violations, and to ensure that a company with substantial revenues
    such as Teletronics does not consider the proposed forfeiture merely
    "an affordable cost of doing business,"[^84] we find that a proposed
    forfeiture in the amount of \$692,000 is warranted. As discussed,
    this proposed forfeiture amount includes: (1) a total penalty of
    \$100,000 for Teletronics' apparent failure to register with the
    Commission as required by the Commission's rules; (2) a total
    penalty of \$250,000 for Teletronics' apparent failure to file five
    Telecommunications Reporting Worksheets within the last year as
    required by the Commission's rules; (3) a total penalty of \$308,000
    for Teletronics' apparent failure to make required universal service
    contributions for 12 months within the last year on the basis of its
    end-user telecommunications revenues; (4) a total penalty of
    \$14,000 for Teletronics' apparent failure to make TRS contributions
    within the last year on the basis of its interstate end-user
    telecommunications revenues; (5) a total penalty of \$10,000 for
    Teletronics' apparent failure to make NANPA contributions within the
    last year on the basis of its end-user telecommunications revenues;
    and (6) a total penalty of \$10,000 for Teletronics' apparent
    failure to make regulatory fee payments within the last year on the
    basis of its interstate and international end-user
    telecommunications revenues.

38. We caution that additional violations of the Act or the Commission's
    rules could subject Teletronics to further enforcement action. Such
    action could take the form of higher monetary forfeitures and/or
    possible revocation of Teletronics' operating authority, including
    disqualification of Teletronics' principals from the provision of
    any interstate common carrier services without the prior consent of
    the Commission.[^85] In addition, we note that, to the extent
    Teletronics is found to be delinquent on any debt owed to the
    Commission (e.g., has failed to pay all of its USF contributions),
    the Commission will not act on, and may dismiss, any application or
    request for authorization filed by Teletronics, in accordance with
    the agency's "red light" rules.[^86] We order Teletronics to submit
    within thirty days, either as part of its response to this NAL or
    separately, a report, supported by a sworn statement or declaration
    under penalty of perjury of a corporate officer, stating its plan to
    come into compliance with the relevant payment and reporting rules
    discussed herein. We further order Teletronics to file with USAC
    within thirty days all Annual Telecommunications Reporting
    Worksheets required under the Commission's rules from the date it
    began providing telecommunications service in the United States to
    the date of this NAL.

    **V. ORDERING CLAUSES**

39. ACCORDINGLY, IT IS ORDERED THAT, pursuant to section 503(b) of the
    Communications Act of 1934, as amended,[^87] and section 1.80 of the
    Commission's rules,[^88] that Teletronics, Inc. is hereby NOTIFIED
    of its APPARENT LIABILITY FOR A FORFEITURE in the amount of
    \$692,000 for willfully and repeatedly violating the Act and the
    Commission's rules.

40. IT IS FURTHER ORDERED THAT, pursuant to section 1.80 of the
    Commission's Rules,[^89] within thirty days of the release date of
    this NOTICE OF APPARENT LIABILITY, Teletronics, Inc. SHALL PAY the
    full amount of the proposed forfeiture or SHALL FILE a written
    statement seeking reduction or cancellation of the proposed
    forfeiture.

41. IT IS FURTHER ORDERED THAT, pursuant to sections 4(i), 9(a)(1),
    219(b), 254(d), 225(b)(1), and 251(e)(2) of the Act, 47 U.S.C. §§
    4(i), 159(a)(1), 219(b), 254(d), 225(b)(1), 251(e)(2), and sections
    54.706(a), 64.604(c)(5)(iii), 52.17, 54.711(a), 64.1195(a), 1.1154,
    and 1.1157(b)(1) of the Commission's rules, 47 C.F.R. §§ 54.706(a),
    64.604(c)(5)(iii), 52.17, 54.711(a), 64.1195(a), 1.1154, and
    1.1157(b)(1), within thirty days of the release of this NOTICE OF
    APPARENT LIABILITY AND ORDER, Teletronics, Inc. SHALL SUBMIT a
    report, supported by a sworn statement or declaration under penalty
    of perjury by a corporate officer, stating its plan promptly to come
    into compliance with the payment and reporting rules discussed
    herein. Teletronics, Inc. also SHALL SUBMIT to the Universal Service
    Administrative Company within thirty days all Annual
    Telecommunications Reporting Worksheets required under the
    Commission's rules from the date Teletronics, Inc. began providing
    telecommunications service in the United States to the date of this
    NAL.

42. Payment of the forfeiture must be made by check or similar
    instrument, payable to the order of the Federal Communications
    Commission.  The payment must include the NAL/Acct. No. and FRN No.
    referenced above.  Payment by check or money order may be mailed to
    Federal Communications Commission, P.O. Box 358340, Pittsburgh, PA
    15251-8340.  Payment by overnight mail may be sent to Mellon
    Bank /LB 358340, 500 Ross Street, Room 1540670, Pittsburgh, PA
    15251.   Payment by wire transfer may be made to ABA
    Number 043000261, receiving bank Mellon Bank, and account
    number 911-6106.

43. The response, if any, to this NOTICE OF APPARENT LIABILITY must be
    mailed to William H. Davenport, Chief, Investigations and Hearings
    Division, Enforcement Bureau, Federal Communications Commission, 445
    12^th^ Street, S.W., Washington, D.C. 20554 and must include the
    NAL/Acct. No. referenced above.

44. The Commission will not consider reducing or canceling a forfeiture
    in response to a claim of inability to pay unless the petitioner
    submits: (1) federal tax returns for the most recent three-year
    period; (2) financial statements prepared according to generally
    accepted accounting practices (GAAP); or (3) some other reliable and
    objective documentation that accurately reflects the petitioner's
    current financial status. Any claim of inability to pay must
    specifically identify the basis for the claim by reference to the
    financial documentation submitted.

45. Requests for payment of the full amount of this NAL under an
    installment plan should be sent to Chief, Credit and Management
    Center, 445 12^th^ Street, S.W., Washington, D.C. 20554.[^90]

46. IT IS FURTHER ORDERED that a copy of this NOTICE OF APPARENT
    LIABILITY AND ORDER shall be sent by certified mail, return receipt
    requested, to Gale Kenney, Chief Executive Officer, Teletronics,
    Inc., 1200 Valley Belt Road, Cleveland, Ohio 44131, and David A.
    Ferris, Counsel for Teletronics, Inc., Ferris and Neuman, L.L.P.,
    2733 West Dublin-Granville Road, Columbus, Ohio 43235.

    FEDERAL COMMUNICATIONS COMMISSION

    Marlene H. Dortch

    Secretary

[^1]: 47 C.F.R. §§ 64.1195(a).

[^2]: 47 C.F.R. §§ 54.711(a), 64.604(c)(5)(iii)(B), 52.17(b).

[^3]: 47 U.S.C. §§ 254(d), 251(e)(2).

[^4]: 47 C.F.R. §§ 54.706(a), 64.604(c)(5)(iii)(A), 52.17(a).

[^5]: 47 C.F.R. §§ 1.1154, 1.1157(b)(1).

[^6]: The Commission has appointed USAC as the administrator of federal
    universal service support mechanisms and has made it responsible for
    billing and collection. 47 C.F.R. §§ 54.701(a), 54.702(b).

[^7]: *See* www.teletronics-inc.com.

[^8]: *See* Letter from David A. Ferris, Counsel for Teletronics, Inc.,
    Ferris and Neuman, L.L.P, to Gerald H. Chakerian, Attorney,
    Investigations and Hearings Division, Enforcement Bureau, FCC, dated
    November 24, 2004. Because this letter did not specify the exact
    dates in 1999 that Teletronics began interstate and international
    services, the applicability of regulatory provisions that became
    effective during that year has not yet been fully determined.

[^9]: *See, e.g.,* 47 U.S.C. § 151.

[^10]: *See* *Implementation of the Subscriber Carrier Selection
    Provisions of the Telecommunications Act of 1996*, 15 FCC Rcd 15996,
    16024 (2000) ("*Carrier Selection Order*").

[^11]: *See* 47 U.S.C. §§ 9(a),(b); 225(d)(3); 251(e)(2); 254(d). In
    1999, to streamline the administration of the programs and to ease
    the burden on regulatees, the Commission consolidated the
    information filing requirements for multiple telecommunications
    regulatory programs into the annual Telecommunications Reporting
    Worksheet. *See* *1998 Biennial Regulatory Review,* Report and
    Order, 14 FCC Rcd 16602 (1999). The next year the Commission revised
    the Telecommunications Reporting Worksheet slightly to collect the
    additional information necessary to achieve its goal of establishing
    a central repository for interstate telecommunications providers by
    the least provider-burdensome method. *Carrier Selection Order*, 15
    FCC Rcd at 16026.

[^12]: The Telecommunications Act of 1996 amended the Communications Act
    of 1934. *See* Telecommunications Act of 1996, Pub. L. No. 104-104,
    110 Stat. 56 (1996) ("1996 Act").

[^13]: 47 U.S.C. § 254(d).

[^14]: 47 C.F.R. § 54.706(b). Beginning April 1, 2003, carrier
    contributions were based on a carrier's projected, rather than
    historical, revenues. *Id.*

[^15]: 47 U.S.C. § 225(b)(1).

[^16]: *See Telecommunications Relay Services and the Americans with
    Disabilities Act of 1990*, Third Report and Order, 8 FCC Rcd 5300,
    5301, ¶ 7 (1993) ("*TRS III Order*"). Telecommunications relay
    services enable persons with hearing and speech disabilities to
    communicate by telephone with persons who may or may not have such
    disabilities. Such services provide telephone access to a
    significant number of Americans who, without it, might not be able
    to make or receive calls from others. *See Telecommunications Relay
    Services and Speech-to-Speech Services for Individuals with Hearing
    and Speech Disabilities*, Report and Order, 15 FCC Rcd 5140, 5143, ¶
    5 (2000). NECA currently is responsible for administering the TRS
    Fund.

[^17]: 47 C.F.R. § 64.604(c)(5)(iii)(A).

[^18]: 47 U.S.C. § 251(e)(1).

[^19]: 47 U.S.C. § 251(e)(2).

[^20]: 47 C.F.R. § 52.17(a).

[^21]: Section 9(a)(1) of the Act directs the Commission to "assess and
    collect regulatory fees to recover the costs of the following
    regulatory activities of the Commission: enforcement activities,
    policy and rulemaking activities, user information services, and
    international activities." 47 U.S.C. § 159(a)(1); *see also* 47
    C.F.R. § 1.1151.

[^22]: *See* 47 C.F.R. §§ 1.1154, 1.1157(b)(1).

[^23]: 47 C.F.R. § 1.1157(b)(1). Section 1.1154 of the Commission's
    rules sets forth the schedule of annual regulatory charges and
    filing locations for common carrier services. *See* 47 C.F.R. §
    1.1154.

[^24]: *See* 47 U.S.C. §§ 159(c)(1), (c)(3).

[^25]: 47 C.F.R. § 1.1910. The rule went into effect on November 1,
    2004. *See* "FCC Announces Brief Delay in Enforcement of Red Light
    Rule," *Public Notice,* 19 FCC Rcd 19452 (2004).

[^26]: Individual universal service contribution amounts that are based
    upon quarterly filings are subject to an annual true-up. *See
    Federal-State Joint Board on Universal Service, Petition for
    Reconsideration filed by AT&T,* Report and Order and Order on
    Reconsideration, 16 FCC Rcd 5748 (2001) ("*Quarterly Reporting
    Order*"); 47 C.F.R. § 54.709(a).

[^27]: *See* *Globcom, Inc.*, Notice of Apparent Liability for
    Forfeiture and Order*,* 18 FCC Rcd 19893, 19896 (2003)
    ("*Globcom*"); 47 C.F.R. § 54.711(a) ("The Commission shall announce
    by Public Notice published in the Federal Register and on its
    website the manner of payment and the dates by which payments must
    be made."). *See, e.g.,* "Proposed Third Quarter 2003 Contribution
    Factor," *Public Notice*, 18 FCC Rcd 11442 (2003) ("Contribution
    payments are due on the date shown on the \[USAC\] invoice.") The
    Act and our rules, however, do not condition payment on receipt of
    an invoice or other notice from USAC. *See* 47 U.S.C. § 254(d); 47
    C.F.R. § 54.706(b). A carrier that does not file may fail to receive
    an invoice from USAC, but is nonetheless required to contribute to
    the universal service fund, unless its revenues are considered *de
    minimus.* The instructions for the Telecommunications Reporting
    Worksheet include tables for carriers to determine their annual
    contributions.

[^28]: 47 C.F.R. § 54.713.

[^29]: *See* 47 C.F.R. §§ 52.17(b), 64.604(c); *Assessment and
    Collection of Regulatory Fees for Fiscal Year 2004*, 19 FCC Rcd
    11662, 11675, 11717 (2004).

[^30]: *See* 47 C.F.R. § 64.1195(a).

[^31]: *See* Letter from Hugh L. Boyle, Chief Auditor, Investigations
    and Hearings Division, Enforcement Bureau, FCC, to Teletronics,
    Inc., dated March 30, 2004 (requesting confirmation that Teletronics
    had filed registration information pursuant to section 64.1195(a) of
    the Commission's rules) ("March 30 Audit Letter"); Letter from Hugh
    L. Boyle, Chief Auditor, Investigations and Hearings Division,
    Enforcement Bureau, FCC, to Teletronics, Inc., dated June 18, 2004
    (again requesting confirmation that Teletronics had filed
    registration information pursuant to section 64.1195(a) of the
    Commission's rules) ("June 18 Audit Letter").

[^32]: *See* Letter from David A. Ferris, Counsel for Teletronics, Inc.,
    Ferris and Neuman, L.L.P., to Andrew Skadin, Auditor, Investigations
    and Hearings Division, Enforcement Bureau, FCC, dated July 12, 2004
    ("Teletronics July 12 Letter"). The Teletronics July 12 Letter
    references, (1) the March 30 Audit Letter, (2) Teletronics' e-mail
    responses thereto on May 12 and 18, 2004 (copies of which are
    attached), and (3) the June 18 Audit Letter.

[^33]: *See* Letter from Hillary DeNigro, Deputy Chief, Investigations
    and Hearings Division, Enforcement Bureau, FCC, to Gale Kenney,
    Chief Executive Officer, Teletronics, Inc., dated October 28, 2004
    ("LOI").

[^34]: *See* Letter from David A. Ferris, Counsel for Teletronics, Inc.,
    Ferris and Neuman, L.L.P, to Gerald H. Chakerian, Attorney,
    Investigations and Hearings Division, Enforcement Bureau, FCC, dated
    November 24, 2004 ("Teletronics November 24 Letter"); Letter from
    David A. Ferris, Counsel for Teletronics, Inc., Ferris and Neuman,
    L.L.P., to Gerald H. Chakerian, Attorney, Investigations and
    Hearings Division, Enforcement Bureau, FCC, dated January 3, 2005
    ("Teletronics January 3 Letter").

[^35]: *See* Teletronics November 24 Letter, Responses to Inquiries Nos.
    4, 7-13.

[^36]: 47 U.S.C. § 503(b)(1)(B); 47 C.F.R. § 1.80(a)(1). Section
    312(f)(1) of the Act defines willful as "the conscious and
    deliberate commission or omission of \[any\] act, irrespective of
    any intent to violate" the law. 47 U.S.C. § 312(f)(1). The
    legislative history to section 312(f)(1) of the Act clarifies that
    this definition of willful applies to both sections 312 and 503(b)
    of the Act, H.R. Rep. No. 97-765, 97^th^ Cong. 2d Sess. 51 (1982),
    and the Commission has so interpreted the term in the section 503(b)
    context. *See, e.g., Application for Review of Southern California
    Broadcasting Co.*, Memorandum Opinion and Order, 6 FCC Rcd 4387,
    4388 (1991) ("*Southern California Broadcasting Co.*"). The
    Commission may also assess a forfeiture for violations that are
    merely repeated, and not willful. *See, e.g.,* *Callais Cablevision,
    Inc., Grand Isle, Louisiana*, Notice of Apparent Liability for
    Monetary Forfeiture, 16 FCC Rcd 1359 (2001) (issuing a Notice of
    Apparent Liability for, *inter alia*, a cable television operator's
    repeated signal leakage). "Repeated" means that the act was
    committed or omitted more than once, or lasts more than one day.
    *Callais Cablevision, Inc.,* 16 FCC Rcd at 1362, ¶ 9; *Southern
    California Broadcasting Co.,* 6 FCC Rcd at 4388, ¶ 5.

[^37]: 47 U.S.C. § 503(b); 47 C.F.R. § 1.80(f).

[^38]: *See, e.g., SBC Communications, Inc*., Forfeiture Order, 17 FCC
    Rcd 7589, 7591, ¶ 4 (2002) (forfeiture paid).

[^39]: 47 U.S.C. §§ 254(d), 251(e)(2).

[^40]: 47 C.F.R. §§ 64.1195(a), 54.711(a), 64.604(c)(5)(iii), 52.17,
    54.706(a), 1.1154, 1.1157(b)(1).

[^41]: 47 U.S.C. §§ 254(d), 251(e)(2).

[^42]: 47 C.F.R. §§ 64.1195(a), 54.711(a), 64.604(c)(5)(iii), 52.17,
    54.706(a), 1.1154, 1.1157(b)(1).

[^43]: 47 C.F.R. § 64.1195(a); *Carrier Selection Order*, 15 FCC Rcd
    15996, 16025 (requiring existing carriers to register on the date
    the new registration requirement becomes effective by means of
    certain information in a Form 499-A); 66 FR 17083 (2001) (announcing
    that the OMB approved information collection requirement in section
    64.1195 of our rules would take effect on April 2, 2001).

[^44]: *Id*. The Commission adopted the registration requirement in
    section 64.1195(a) after finding that such a requirement would
    enable it to better monitor the entry of carriers into the
    interstate telecommunications market and any associated increases in
    slamming activity, and, among other things, would enhance the
    Commission's ability to take appropriate enforcement action against
    carriers that have demonstrated a pattern or practice of slamming.
    *See Carrier Selection Order,*15 FC Rcd at 16024 ¶ 62.

[^45]: Teletronics' compliance with the registration requirement that
    became effective April 2, 2001 would have alerted program
    administrators that it had operated without participation in any of
    the programs since it began providing interstate service in 1999.

[^46]: 47 C.F.R. § 1.1910.

[^47]: *See* 47 C.F.R. §§ 54.711(a), 64.604(c)(5)(iii)(B), 52.17(b); 64
    Fed. Reg. 41320-01 (Jul. 30, 1999).

[^48]: *Id*.

[^49]: Sixty days prior to the start of each quarter, USAC is required
    to provide the Commission with a projection of the high cost, low
    income, schools and libraries, and rural health care funding
    requirements for the following quarter. *See*
    [www.universalservice.org/overview/filings](http://www.universalservice.org/overview/filings).
    Based on USAC's projection of the needs of the Universal Service
    Fund, and revenue projections from the registered carriers subject
    to universal service requirements, the Commission establishes a
    specific percentage of interstate and international end-user
    revenues that each subject telecommunications provider must
    contribute toward the Fund. This percentage is called the
    contribution factor. The contribution factor, and, consequently, the
    amount owed to the Fund by each affected telecommunications company,
    changes each quarter, depending on the needs of the Universal
    Service Fund and carrier-provided revenue projections. *See*
    [www.fcc.gov/wcb/universal_service/quarter](http://www.fcc.gov/wcb/universal_service/quarter).
    Thus, in cases where a carrier, such as Teletronics, fails to file
    required Worksheets reporting its revenue projections in a timely
    fashion, its revenues are excluded from the contribution base from
    which universal assessments are derived, and the economic burden of
    contributing to the Fund falls disproportionately on carriers that
    have satisfied their reporting obligations.

[^50]: 47 U.S.C. § 254(d).

[^51]: 47 U.S.C. § 254(d); 47 C.F.R. § 54.706(c).

[^52]: 47 C.F.R. § 54.706(c).

[^53]: *See* 47 C.F.R. § 54.706(a)(16).

[^54]: *See* 47 C.F.R. § 54.706(c).

[^55]: Teletronics November 24 Letter, Response to Inquiry No. 9.

[^56]: *Globcom,* 18 FCC Rcd at 19903 ¶ 26.

[^57]: 47 C.F.R. § 64.604(c)(5)(iii)(A).

[^58]: *Id.* Each subject carrier must contribute at least \$25 per
    year. Carriers whose annual contributions are less than \$1,200 must
    pay the entire amount at the beginning of the contribution period.
    47 C.F.R. § 64.604(c)(5)(iii)(B). Otherwise, carriers may divide
    their contributions into equal monthly payments. *Id*

[^59]: *Id.*

[^60]: *Id..*

[^61]: Teletronics November 24 Letter, Response to Inquiry No. 10.

[^62]: 47 U.S.C. § 251(e)(2); 47 C.F.R. § 52.17(a).

[^63]: *Id.* § 52.17(a). In particular, contributions to support
    numbering administration are based upon a carrier's end-user
    telecommunications revenues for the prior calendar year and a
    contribution factor determined annually by the Chief of the Wireline
    Competition Bureau, but in no event will be less than \$25. *Id.*
    NANPA contributions are due on an annual basis, with certain
    exceptions.

[^64]: Teletronics November 24 Letter, Response to Inquiry No. 11.

[^65]: 47 C.F.R. §§ 1.1154, 1.1157. Payments of standard regulatory fees
    applicable to common carrier services must be filed in full on an
    annual basis. *Id.* § 1.1157(b)(1).

[^66]: Teletronics November 24 Letter, Response to Inquiry No. 13.

[^67]: 47 U.S.C. § 503(b)(1)(B); *see also* 47 C.F.R. § 1.80(a)(2).

[^68]: 47 U.S.C. § 503(b)(2)(B); *see also* 47 C.F.R. § 1.80(b)(2).

[^69]: 47 U.S.C. § 503(b)(2)(D); *see also Forfeiture Policy Statement*,
    12 FCC Rcd at 17100, ¶ 27; 47 C.F.R. § 1.80(b).

[^70]: 47 U.S.C. § 503(b)(6)(B); *see also* 47 C.F.R. § 1.80(c)(3).

[^71]: *See* 47 C.F.R. § 1.80(b)(4).

[^72]: *Cf.,* *Globcom ,* 18 FCC Rcd 19893 (2003); *America's
    Tele-Network Corp.*, Notice of Apparent Liability for Forfeiture, 15
    FCC Rcd 20903 (2000); *Matrix Telecom, Inc.*, Notice of Apparent
    Liability for Forfeiture, 15 FCC Rcd 13544 (2000); *ConQuest
    Operator Services Corp.*, Order of Forfeiture, 14 FCC Rcd 12518
    (1999) (each carrier had registered and filed Telecommunications
    Reporting Worksheets prior to the Commission's inquiry and, in some
    cases, had paid contributions in part).

[^73]: *See* 47 C.F.R. § 1.80(b)(4).

[^74]: In the *Globcom NAL*, the Commission proposed a \$50,000
    forfeiture for each instance within the statute of limitations that
    Globcom failed to file a required Worksheet. *Globcom,* 18 FCC Rcd
    at 19905, ¶ 32. We note, however, that, unlike Teletronics, Globcom
    had registered with the Commission and submitted multiple Worksheets
    prior to our investigation.

[^75]: *See id*.

[^76]: *See* 47 U.S.C. § 254(d).

[^77]: *See Globcom,* 18 FCC Rcd at 19903-19904, ¶¶ 25-27.

[^78]: *See, e.g., id.* 18 FCC Rcd at 19904.

[^79]: 47 U.S.C. § 225(b)(1).

[^80]: *See Globcom,* 18 FCC Rcd at 19904, ¶ 29.

[^81]: *Id.*

[^82]: 47 U.S.C. § 251(e)(2).

[^83]: For example, the 2004 TRS Fund contribution factor was .00356 per
    dollar of interstate and international end-user revenue and the 2004
    interstate telecommunications regulatory fee assessment was .00218
    per dollar of interstate and international end-user revenue. *See
    Telecommunications Relay Services and Speech-to-Speech Services for
    Individuals with Hearing and Speech Disabilities*, 19 FCC Rcd 12224,
    12225 (2004); *Assessment and Collection of Regulatory Fees for
    Fiscal Year 2004*, 19 FCC Rcd at 11691.

[^84]: *Forfeiture Policy Statement*, 12 FCC Rcd at 17099; *see also* 47
    C.F.R. § 1.80(b)(4).

[^85]: *See Business Options, Inc.,* Consent Decree, 19 FCC Rcd 2916
    (2003); *NOS Communications, Inc., Affinity Network Incorporated and
    NOSVA Limited Partnership,* Consent Decree, 2003 WL 22439710 (2003).

[^86]: 47 C.F.R. § 1.1910.

[^87]: 47 U.S.C. § 503(b).

[^88]: 47 C.F.R. § 1.80,

[^89]: *See* 47 C.F.R. § 1.80(f)(3).

[^90]: *See* 47 C.F.R. § 1.1914.