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[Senate Report 114-368]
[From the U.S. Government Publishing Office]

                                                       Calendar No. 659

114th Congress    }                                          {   Report
                              SENATE                          
 2d Session       }                                          {   114-368
_______________________________________________________________________

                                     

                                                       

               RURAL HEALTH CARE CONNECTIVITY ACT OF 2015

                               __________

                              R E P O R T

                                 of the

           COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION

                                   on

                                S. 1916
                                

                October 27, 2016.--Ordered to be printed
Filed, under authority of the order of the Senate of September 29, 2016

                             _________ 
                                  
                U.S. GOVERNMENT PUBLISHING OFFICE
 69-010                  WASHINGTON : 2016       

       SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION
                    one hundred fourteenth congress
                             second session

                   JOHN THUNE, South Dakota, Chairman
 ROGER F. WICKER, Mississippi         BILL NELSON, Florida
 ROY BLUNT, Missouri                  MARIA CANTWELL, Washington
 MARCO RUBIO, Florida                 CLAIRE McCASKILL, Missouri
 KELLY AYOTTE, New Hampshire          AMY KLOBUCHAR, Minnesota
 TED CRUZ, Texas                      RICHARD BLUMENTHAL, Connecticut
 DEB FISCHER, Nebraska                BRIAN SCHATZ, Hawaii
 JERRY MORAN, Kansas                  ED MARKEY, Massachusetts
 DAN SULLIVAN, Alaska                 CORY BOOKER, New Jersey
 RON JOHNSON, Wisconsin               TOM UDALL, New Mexico
 DEAN HELLER, Nevada                  JOE MANCHIN, West Virginia
 CORY GARDNER, Colorado               GARY PETERS, Michigan
 STEVE DAINES, Montana
                       Nick Rossi, Staff Director
                 Adrian Arnakis, Deputy Staff Director
                    Jason Van Beek, General Counsel
                 Kim Lipsky, Democratic Staff Director
           Christopher Day, Democratic Deputy Staff Director
                 Clint Odom, Democratic General Counsel
                 
                 
                 

                                                       Calendar No. 659
                                                       
                                                       
114th Congress    }                                          {   Report
                                 SENATE
 2d Session       }                                          {  114-368

======================================================================

 
               RURAL HEALTH CARE CONNECTIVITY ACT OF 2015

                                _______
                                

                October 27, 2016.--Ordered to be printed

Filed, under authority of the order of the Senate of September 29, 2016

                                _______
                                

Mr. Thune, from the Committee on Commerce, Science, and Transportation, 
                        submitted the following

                              R E P O R T

                         [To accompany S. 1916]

    The Committee on Commerce, Science, and Transportation, to 
which was referred the bill (S. 1916) to include skilled 
nursing facilities as a type of health care provider under 
section 254(h) of the Communications Act of 1934, having 
considered the same, reports favorably thereon (without 
amendment) and recommends that the bill do pass.

                          Purpose of the Bill

    The purpose of S. 1916, the Rural Health Care Connectivity 
Act of 2015, is to include skilled nursing facilities (SNFs) 
among the types of health care providers that may obtain 
support from the Universal Service Fund's (USF) Rural Health 
Care Program (RHCP).

                          Background and Needs

    Americans living in rural areas face acute shortages of 
primary care physicians and specialists, and often must travel 
long distances to obtain medical care. SNFs are particularly 
well-suited to improve patient outcomes in these rural areas, 
providing some of the same post-acute services that are 
traditionally provided at hospitals, such as the management, 
observation, and evaluation of patient care. As the Federal 
Communications Commission (FCC) has noted, by their nature, 
SNFs are often remote from doctors and sophisticated laboratory 
and testing facilities, making the availability of electronic 
health records and telehealth an especially valuable benefit to 
rural convalescents or patients for whom traveling to see a 
doctor, diagnostician, or specialist would be especially 
difficult.
    The RHCP provides USF funding for telecommunications and 
broadband services used to provide health care services to 
rural Americans. Section 254(h) of the Communications Act of 
1934 (47 U.S.C. 254(h)) specifies which types of health care 
providers are eligible to receive RHCP support. These include: 
post-secondary educational institutions offering healthcare 
instruction, teaching hospitals, and medical schools; community 
health centers or health centers providing health care to 
migrants; local health departments or agencies; community 
mental health centers; not-for-profit hospitals; rural health 
clinics; and a consortia of health care providers consisting of 
one or more of the aforementioned entities. SNFs, however, are 
not included in that Act.
    In 2012, the FCC proposed to include not-for-profit SNFs 
within the definition of ``not-for-profit hospital'' under the 
Communications Act of 1934 (47 U.S.C. 151 et seq.), and it also 
proposed to establish a pilot program to provide limited RHCP 
support to those SNFs beginning in 2014. That pilot program was 
later deferred pending FCC action on other issues related to 
the RHCP, and the FCC has not implemented the expanded 
definition of ``non-for-profit hospitals.'' Thus, SNFs remain 
ineligible today to receive RHCP support.

                         Summary of Provisions

    S. 1916 would amend the Communications Act of 1934 to 
include SNFs among the types of health care providers that are 
eligible for RHCP support and may request from a 
telecommunications carrier under the USF the necessary 
telecommunications and information services to serve persons 
who reside in rural areas at rates that are reasonably 
comparable to rates charged for similar services in urban 
areas.

                          Legislative History

    On August 3, 2015, Chairman Thune introduced the Rural 
Health Care Connectivity Act of 2015. The legislation is 
cosponsored by Senators Klobuchar, Hoeven, and Fischer. Similar 
legislation (H.R. 4111) was introduced in the House of 
Representatives by Representative Leonard Lance on November 19, 
2015.
    On November 18, 2015, the Committee ordered that S. 1916 be 
reported favorably without amendment.

                            Estimated Costs

    In accordance with paragraph 11(a) of rule XXVI of the 
Standing Rules of the Senate and section 403 of the 
Congressional Budget Act of 1974, the Committee provides the 
following cost estimate, prepared by the Congressional Budget 
Office:

S. 1916--Rural Health Care Connectivity Act of 2015

    Summary: S. 1916 would make certain skilled nursing 
facilities eligible for grants under the Universal Service 
Fund's (USF's) Rural Health Care (RHC) program. The Universal 
Service program is administered by the Federal Communications 
Commission (FCC) and is intended to promote the availability of 
telecommunications services at affordable rates. The cash flows 
of the USF appear in the budget as direct spending (for amounts 
distributed from the fund) and as revenues (for fund 
collections).
    CBO estimates that enacting S. 1916 would increase direct 
spending by $197 million over the 2017-2026 period and result 
in increased revenue collections of $215 million over the same 
period, resulting in an estimated net reduction in the deficit 
of $18 million. CBO estimates that implementing the bill would 
have no significant discretionary costs. Pay-as-you-go 
procedures apply because enacting the legislation would affect 
direct spending and revenues.
    CBO estimates that enacting the legislation would not 
increase net direct spending or on-budget deficits by more than 
$5 billion in one or more of the four consecutive 10-year 
periods beginning in 2027.
    S. 1916 contains no intergovernmental mandates as defined 
in the Unfunded Mandates Reform Act (UMRA). CBO expects the FCC 
would increase fee collections associated with the USF to 
offset some of the costs of expanding the Rural Health Care 
program. As a result, the bill would increase the cost of an 
existing mandate on private entities required to pay those 
fees. Based on information from the FCC, CBO estimates that the 
cost of the mandate would amount to no more than $25 million in 
any of the next five years. Thus, the aggregate cost of the 
mandate would fall below the annual threshold established in 
UMRA for private-sector mandates ($154 million in 2016, 
adjusted annually for inflation).
    Estimated cost to the Federal Government: The estimated 
budgetary effect of S. 1916 is shown in the following table. 
The costs of this legislation fall within budget function 370 
(commerce and housing credit).

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                  By fiscal year, in millions of dollars--
                                                   -----------------------------------------------------------------------------------------------------
                                                     2017    2018    2019    2020    2021    2022    2023    2024    2025    2026   2017-2021  2017-2026
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               INCREASE IN DIRECT SPENDING
 
Estimated Budget Authority........................       5      10      15      20      25      25      25      30      30      30        75        215
Estimated Outlays.................................       3       7      12      17      22      24      25      28      29      30        61        197
 
                                                                  INCREASE IN REVENUES
 
Estimated Revenues................................       5      10      15      20      25      25      25      30      30      30        75        215
 
                                                               NET DECREASE IN THE DEFICIT
 
Impact on Deficit.................................      -2      -3      -3      -3      -3      -1       0      -2      -1       0       -14        -18
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Basis of estimate: Current law authorizes the Universal 
Service program to collect and spend up to $400 million a year 
for Rural Health Care (RHC) programs, which provide reduced 
rates for telecommunications services for certain rural public 
and nonprofit health care providers. Expanding the eligibility 
criteria to include skilled nursing facilities (SNFs) would 
increase direct spending and revenues because the RHC programs 
currently operate below the statutory cap on total spending.
    CBO estimates that enacting the program over the 2017-2026 
period would increase direct spending and revenues by $197 
million and $215 million, respectively, resulting in a net 
reduction in the deficit of $18 million over that period. CBO 
estimates that an average of 1,650 public and nonprofit SNFs in 
rural areas would be eligible for grants during that period and 
that participation rates and grant awards would be similar to 
those for existing RHC programs. Based on information from the 
FCC, CBO estimates that participation rates would reach 75 
percent over a period of several years and that certain non-
rural entities affiliated with those participants also would 
receive funding. Grant awards would vary in size depending on 
the recipient's location and choice of benefits. In 2015, most 
RHC grantees received an average of about $14,000 for 
telecommunications services; by contrast, payments to entities 
in Alaska averaged roughly $140,000 because of the higher cost 
of services in that state. CBO estimates that grants would 
average about $18,000 a year over the next 10 years, reflecting 
the historical growth in payments for other RHC programs.
    Finally, based on information from the FCC, CBO estimates 
that the administrative activities needed to implement the new 
program would not have a significant effect on the agency's 
operating costs. Moreover, under current law, the FCC is 
authorized to collect fees sufficient to offset the cost of its 
regulatory activities each year.
    Pay-As-You-Go considerations: The Statutory Pay-As-You-Go 
Act of 2010 establishes budget-reporting and enforcement 
procedures for legislation affecting direct spending or 
revenues. The net changes in outlays and revenues that are 
subject to those pay-as-you-go procedures are shown in the 
following table.

 CBO ESTIMATE OF PAY-AS-YOU-GO EFFECTS FOR S. 1916, AS ORDERED REPORTED BY THE SENATE COMMITTEE ON COMMERCE, SCIENCE, AND TRANSPORTATION ON NOVEMBER 18,
                                                                          2015
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                              By fiscal year, in millions of dollars--
                                           -------------------------------------------------------------------------------------------------------------
                                             2016    2017    2018    2019    2020    2021    2022    2023    2024    2025    2026   2016-2021  2016-2026
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                 DECREASE IN THE DEFICIT
 
Statutory Pay-As-You-Go Impact............       0      -2      -3      -3      -3      -3      -1       0      -2      -1       0       -14        -18
Memorandum:
    Changes in Outlays....................       0       3       7      12      17      22      24      25      28      29      30        61        197
    Changes in Revenues...................       0       5      10      15      20      25      25      25      30      30      30        75        215
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Increase in long-term direct spending and deficits: CBO 
estimates that enacting the legislation would not increase net 
direct spending or on-budget deficits by more than $5 billion 
in any of the four consecutive 10-year periods beginning in 
2027.
    Estimated impact on state, local, and tribal governments: 
S. 1916 contains no intergovernmental mandates as defined in 
UMRA.
    Estimated impact on the private sector: CBO expects the FCC 
to increase fee collections to offset the costs associated with 
expanding the USF's Rural Health Care program to cover skilled 
nursing facilities. As a result, the bill would increase the 
cost of an existing mandate on some telecommunications 
companies required to pay those fees. Based on information from 
the FCC, CBO estimates that the cost of the mandate would 
amount to about $5 million in 2017, increasing to about $25 
million in 2021. Therefore, the incremental cost of the mandate 
would fall below the annual threshold established in UMRA for 
private-sector mandates ($154 million in 2016, adjusted 
annually for inflation). CBO expects that telecommunications 
companies would generally pass most of the cost of the fee 
increase on to consumers.
    Estimate prepared by: Federal costs: Kathleen Gramp; impact 
on state, local, and tribal governments: Melisa Merrell; impact 
on the private sector: Logan Smith.
    Estimate approved by: Theresa Gullo, Assistant Director for 
Budget Analysis.

                           Regulatory Impact

    In accordance with paragraph 11(b) of rule XXVI of the 
Standing Rules of the Senate, the Committee provides the 
following evaluation of the regulatory impact of the 
legislation, as reported:

                       number of persons covered

    There are approximately 1,650 public and nonprofit SNFs in 
rural areas, many of which would be eligible to participate in 
the RHCP if S. 1916 is enacted.

                            economic impact

    This legislation would not have an adverse economic impact 
on the Nation. The bill would promote rural health care by 
making SNFs eligible to receive telecommunications and 
information services to serve persons who reside in rural areas 
at rates that are reasonably comparable to rates charged for 
similar services in urban areas.

                                privacy

    The bill would not have any adverse impact on the personal 
privacy of individuals.

                               paperwork

    The Committee does not anticipate a major increase in 
paperwork burdens resulting from the passage of this 
legislation.

                   Congressionally Directed Spending

    In compliance with paragraph 4(b) of rule XLIV of the 
Standing Rules of the Senate, the Committee provides that no 
provisions contained in the bill, as reported, meet the 
definition of congressionally directed spending items under the 
rule.

                      Section-by-Section Analysis

Section 1. Short title.

    Section 1 would designate this Act as the ``Rural Health 
Care Connectivity Act of 2015.''

Section 2. Telecommunications services for skilled nursing facilities.

    Section 2 would amend section 254(h) of the Communications 
Act of 1934 (47 U.S.C. 254) to include SNFs in the definition 
of health care providers under that subsection.

                        Changes in Existing Law

    In compliance with paragraph 12 of rule XXVI of the 
Standing Rules of the Senate, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
material is printed in italic, existing law in which no change 
is proposed is shown in roman):

                       COMMUNICATIONS ACT OF 1934

                        [47 U.S.C. 151 et seq.]

SEC. 254. UNIVERSAL SERVICE.

           *       *       *       *       *       *       *

   (h) Telecommunications Services for Certain Providers.--
          (1) In general.--
                  (A) Health care providers for rural areas.--A 
                telecommunications carrier shall, upon 
                receiving a bona fide request, provide 
                telecommunications services which are necessary 
                for the provision of health care services in a 
                State, including instruction relating to such 
                services, to any public or nonprofit health 
                care provider that serves persons who reside in 
                rural areas in that State at rates that are 
                reasonably comparable to rates charged for 
                similar services in urban areas in that State. 
                A telecommunications carrier providing service 
                under this paragraph shall be entitled to have 
                an amount equal to the difference, if any, 
                between the rates for services provided to 
                health care providers for rural areas in a 
                State and the rates for similar services 
                provided to other customers in comparable rural 
                areas in that State treated as a service 
                obligation as a part of its obligation to 
                participate in the mechanisms to preserve and 
                advance universal service.
                  (B) Educational providers and libraries.--All 
                telecommunications carriers serving a 
                geographic area shall, upon a bona fide request 
                for any of its services that are within the 
                definition of universal service under 
                subsection (c)(3), provide such services to 
                elementary schools, secondary schools, and 
                libraries for educational purposes at rates 
                less than the amounts charged for similar 
                services to other parties. The discount shall 
                be an amount that the Commission, with respect 
                to interstate services, and the States, with 
                respect to intrastate services, determine is 
                appropriate and necessary to ensure affordable 
                access to and use of such services by such 
                entities. A telecommunications carrier 
                providing service under this paragraph shall--
                          (i) have an amount equal to the 
                        amount of the discount treated as an 
                        offset to its obligation to contribute 
                        to the mechanisms to preserve and 
                        advance universal service, or
                          (ii) notwithstanding the provisions 
                        of subsection (e) of this section, 
                        receive reimbursement utilizing the 
                        support mechanisms to preserve and 
                        advance universal service.
          (2) Advanced services.--The Commission shall 
        establish competitively neutral rules--
                  (A) to enhance, to the extent technically 
                feasible and economically reasonable, access to 
                advanced telecommunications and information 
                services for all public and nonprofit 
                elementary and secondary school classrooms, 
                health care providers, and libraries; and
                  (B) to define the circumstances under which a 
                telecommunications carrier may be required to 
                connect its network to such public 
                institutional telecommunications users.
          (3) Terms and conditions.--Telecommunications 
        services and network capacity provided to a public 
        institutional telecommunications user under this 
        subsection may not be sold, resold, or otherwise 
        transferred by such user in consideration for money or 
        any other thing of value.
          (4) Eligibility of users.--No entity listed in this 
        subsection shall be entitled to preferential rates or 
        treatment as required by this subsection, if such 
        entity operates as a for-profit business, is a school 
        described in paragraph (7)(A) with an endowment of more 
        than $50,000,000, or is a library or library consortium 
        not eligible for assistance from a State library 
        administrative agency under the Library Services and 
        Technology Act.
          (5) Requirements for certain schools with computers 
        having internet access.--
                  (A) Internet safety.--
                          (i) In general.--Except as provided 
                        in clause (ii), an elementary or 
                        secondary school having computers with 
                        Internet access may not receive 
                        services at discount rates under 
                        paragraph (1)(B) unless the school, 
                        school board, local educational agency, 
                        or other authority with responsibility 
                        for administration of the school--
                                  (I) submits to the Commission 
                                the certifications described in 
                                subparagraphs (B) and (C);
                                  (II) submits to the 
                                Commission a certification that 
                                an Internet safety policy has 
                                been adopted and implemented 
                                for the school under subsection 
                                (l); and
                                  (III) ensures the use of such 
                                computers in accordance with 
                                the certifications.
                          (ii) Applicability.--The prohibition 
                        in clause (i) shall not apply with 
                        respect to a school that receives 
                        services at discount rates under 
                        paragraph (1)(B) only for purposes 
                        other than the provision of Internet 
                        access, Internet service, or internal 
                        connections.
                          (iii) Public notice; hearing.--An 
                        elementary or secondary school 
                        described in clause (i), or the school 
                        board, local educational agency, or 
                        other authority with responsibility for 
                        administration of the school, shall 
                        provide reasonable public notice and 
                        hold at least 1 public hearing or 
                        meeting to address the proposed 
                        Internet safety policy. In the case of 
                        an elementary or secondary school other 
                        than an elementary or secondary school 
                        as defined in section 14101 of the 
                        Elementary and Secondary Education Act 
                        of 1965 (20 U.S.C. 8801), the notice 
                        and hearing required by this clause may 
                        be limited to those members of the 
                        public with a relationship to the 
                        school.
                  (B) Certification with respect to minors.--A 
                certification under this subparagraph is a 
                certification that the school, school board, 
                local educational agency, or other authority 
                with responsibility for administration of the 
                school--
                          (i) is enforcing a policy of Internet 
                        safety for minors that includes 
                        monitoring the online activities of 
                        minors and the operation of a 
                        technology protection measure with 
                        respect to any of its computers with 
                        Internet access that protects against 
                        access through such computers to visual 
                        depictions that are--
                                  (I) obscene;
                                  (II) child pornography; or
                                  (III) harmful to minors;
                          (ii) is enforcing the operation of 
                        such technology protection measure 
                        during any use of such computers by 
                        minors; and
                          (iii) as part of its Internet safety 
                        policy is educating minors about 
                        appropriate online behavior, including 
                        interacting with other individuals on 
                        social networking websites and in chat 
                        rooms and cyberbullying awareness and 
                        response.
                  (C) Certification with respect to adults.--A 
                certification under this paragraph is a 
                certification that the school, school board, 
                local educational agency, or other authority 
                with responsibility for administration of the 
                school--
                          (i) is enforcing a policy of Internet 
                        safety that includes the operation of a 
                        technology protection measure with 
                        respect to any of its computers with 
                        Internet access that protects against 
                        access through such computers to visual 
                        depictions that are--
                                  (I) obscene; or
                                  (II) child pornography; and
                          (ii) is enforcing the operation of 
                        such technology protection measure 
                        during any use of such computers.
                  (D) Disabling during adult use.--An 
                administrator, supervisor, or other person 
                authorized by the certifying authority under 
                subparagraph (A)(i) may disable the technology 
                protection measure concerned, during use by an 
                adult, to enable access for bona fide research 
                or other lawful purpose.
                  (E) Timing of implementation.--
                          (i) In general.--Subject to clause 
                        (ii) in the case of any school covered 
                        by this paragraph as of the effective 
                        date of this paragraph under section 
                        1721(h) of the Children's Internet 
                        Protection Act, the certification under 
                        subparagraphs (B) and (C) shall be 
                        made--
                                  (I) with respect to the first 
                                program funding year under this 
                                subsection following such 
                                effective date, not later than 
                                120 days after the beginning of 
                                such program funding year; and
                                  (II) with respect to any 
                                subsequent program funding 
                                year, as part of the 
                                application process for such 
                                program funding year.
                          (ii) Process.--
                                  (I) Schools with internet 
                                safety policy and technology 
                                protection measures in place. A 
                                school covered by clause (i) 
                                that has in place an Internet 
                                safety policy and technology 
                                protection measures meeting the 
                                requirements necessary for 
                                certification under 
                                subparagraphs (B) and (C) shall 
                                certify its compliance with 
                                subparagraphs (B) and (C) 
                                during each annual program 
                                application cycle under this 
                                subsection, except that with 
                                respect to the first program 
                                funding year after the 
                                effective date of this 
                                paragraph under section 1721(h) 
                                of the Children's Internet 
                                Protection Act [note to this 
                                section], the certifications 
                                shall be made not later than 
                                120 days after the beginning of 
                                such first program funding 
                                year.
                                  (II) Schools without internet 
                                safety policy and technology 
                                protection measures in place.--
                                A school covered by clause (i) 
                                that does not have in place an 
                                Internet safety policy and 
                                technology protection measures 
                                meeting the requirements 
                                necessary for certification 
                                under subparagraphs (B) and 
                                (C)--
                                          (aa) for the first 
                                        program year after the 
                                        effective date of this 
                                        subsection in which it 
                                        is applying for funds 
                                        under this subsection, 
                                        shall certify that it 
                                        is undertaking such 
                                        actions, including any 
                                        necessary procurement 
                                        procedures, to put in 
                                        place an Internet 
                                        safety policy and 
                                        technology protection 
                                        measures meeting the 
                                        requirements necessary 
                                        for certification under 
                                        subparagraphs (B) and 
                                        (C); and
                                          (bb) for the second 
                                        program year after the 
                                        effective date of this 
                                        subsection in which it 
                                        is applying for funds 
                                        under this subsection, 
                                        shall certify that it 
                                        is in compliance with 
                                        subparagraphs (B) and 
                                        (C).
                                  Any school that is unable to 
                                certify compliance with such 
                                requirements in such second 
                                program year shall be 
                                ineligible for services at 
                                discount rates or funding in 
                                lieu of services at such rates 
                                under this subsection for such 
                                second year and all subsequent 
                                program years under this 
                                subsection, until such time as 
                                such school comes into 
                                compliance with this paragraph.
                                  (III) Waivers.--Any school 
                                subject to subclause (II) that 
                                cannot come into compliance 
                                with subparagraphs (B) and (C) 
                                in such second year program may 
                                seek a waiver of subclause 
                                (II)(bb) if State or local 
                                procurement rules or 
                                regulations or competitive 
                                bidding requirements prevent 
                                the making of the certification 
                                otherwise required by such 
                                subclause. A school, school 
                                board, local educational 
                                agency, or other authority with 
                                responsibility for 
                                administration of the school 
                                shall notify the Commission of 
                                the applicability of such 
                                subclause to the school. Such 
                                notice shall certify that the 
                                school in question will be 
                                brought into compliance before 
                                the start of the third program 
                                year after the effective date 
                                of this subsection in which the 
                                school is applying for funds 
                                under this subsection.
                  (F) Noncompliance.--
                          (i) Failure to submit 
                        certification.--Any school that 
                        knowingly fails to comply with the 
                        application guidelines regarding the 
                        annual submission of certification 
                        required by this paragraph shall not be 
                        eligible for services at discount rates 
                        or funding in lieu of services at such 
                        rates under this subsection.
                          (ii) Failure to comply with 
                        certification.--Any school that 
                        knowingly fails to ensure the use of 
                        its computers in accordance with a 
                        certification under subparagraphs (B) 
                        and (C) shall reimburse any funds and 
                        discounts received under this 
                        subsection for the period covered by 
                        such certification.
                          (iii) Remedy of noncompliance.--
                                  (I) Failure to submit.--A 
                                school that has failed to 
                                submit a certification under 
                                clause (i) may remedy the 
                                failure by submitting the 
                                certification to which the 
                                failure relates. Upon submittal 
                                of such certification, the 
                                school shall be eligible for 
                                services at discount rates 
                                under this subsection.
                                  (II) Failure to comply.--A 
                                school that has failed to 
                                comply with a certification as 
                                described in clause (ii) may 
                                remedy the failure by ensuring 
                                the use of its computers in 
                                accordance with such 
                                certification. Upon submittal 
                                to the Commission of a 
                                certification or other 
                                appropriate evidence of such 
                                remedy, the school shall be 
                                eligible for services at 
                                discount rates under this 
                                subsection.
          (6) Requirements for certain libraries with computers 
        having internet access.--
                  (A) Internet safety.--
                          (i) In general.--Except as provided 
                        in clause (ii), a library having one or 
                        more computers with Internet access may 
                        not receive services at discount rates 
                        under paragraph (1)(B) unless the 
                        library--
                                  (I) submits to the Commission 
                                the certifications described in 
                                subparagraphs (B) and (C); and
                                  (II) submits to the 
                                Commission a certification that 
                                an Internet safety policy has 
                                been adopted and implemented 
                                for the library under 
                                subsection (l); and
                                  (III) ensures the use of such 
                                computers in accordance with 
                                the certifications.
                          (ii) Applicability.--The prohibition 
                        in clause (i) shall not apply with 
                        respect to a library that receives 
                        services at discount rates under 
                        paragraph (1)(B) only for purposes 
                        other than the provision of Internet 
                        access, Internet service, or internal 
                        connections.
                          (iii) Public notice; hearing.--A 
                        library described in clause (i) shall 
                        provide reasonable public notice and 
                        hold at least 1 public hearing or 
                        meeting to address the proposed 
                        Internet safety policy.
                  (B) Certification with respect to minors.--A 
                certification under this subparagraph is a 
                certification that the library--
                          (i) is enforcing a policy of Internet 
                        safety that includes the operation of a 
                        technology protection measure with 
                        respect to any of its computers with 
                        Internet access that protects against 
                        access through such computers to visual 
                        depictions that are--
                                  (I) obscene;
                                  (II) child pornography; or
                                  (III) harmful to minors; and
                          (ii) is enforcing the operation of 
                        such technology protection measure 
                        during any use of such computers by 
                        minors.
                  (C) Certification with respect to adults.--A 
                certification under this paragraph is a 
                certification that the library--
                          (i) is enforcing a policy of Internet 
                        safety that includes the operation of a 
                        technology protection measure with 
                        respect to any of its computers with 
                        Internet access that protects against 
                        access through such computers to visual 
                        depictions that are--
                                  (I) obscene; or
                                  (II) child pornography; and
                          (ii) is enforcing the operation of 
                        such technology protection measure 
                        during any use of such computers.
                  (D) Disabling during adult use.--An 
                administrator, supervisor, or other person 
                authorized by the certifying authority under 
                subparagraph (A)(i) may disable the technology 
                protection measure concerned, during use by an 
                adult, to enable access for bona fide research 
                or other lawful purpose.
                  (E) Timing of implementation.--
                          (i) In general.--Subject to clause 
                        (ii) in the case of any library covered 
                        by this paragraph as of the effective 
                        date of this paragraph under section 
                        1721(h) of the Children's Internet 
                        Protection Act [note to this section], 
                        the certification under subparagraphs 
                        (B) and (C) shall be made--
                                  (I) with respect to the first 
                                program funding year under this 
                                subsection following such 
                                effective date, not later than 
                                120 days after the beginning of 
                                such program funding year; and
                                  (II) with respect to any 
                                subsequent program funding 
                                year, as part of the 
                                application process for such 
                                program funding year.
                          (ii) Process.--
                                  (I) Libraries with internet 
                                safety policy and technology 
                                protection measures in place.--
                                A library covered by clause (i) 
                                that has in place an Internet 
                                safety policy and technology 
                                protection measures meeting the 
                                requirements necessary for 
                                certification under 
                                subparagraphs (B) and (C) shall 
                                certify its compliance with 
                                subparagraphs (B) and (C) 
                                during each annual program 
                                application cycle under this 
                                subsection, except that with 
                                respect to the first program 
                                funding year after the 
                                effective date of this 
                                paragraph under section 1721(h) 
                                of the Children's Internet 
                                Protection Act [note to this 
                                section], the certifications 
                                shall be made not later than 
                                120 days after the beginning of 
                                such first program funding 
                                year.
                                  (II) Libraries without 
                                internet safety policy and 
                                technology protection measures 
                                in place.--A library covered by 
                                clause (i) that does not have 
                                in place an Internet safety 
                                policy and technology 
                                protection measures meeting the 
                                requirements necessary for 
                                certification under 
                                subparagraphs (B) and (C)--
                                          (aa) for the first 
                                        program year after the 
                                        effective date of this 
                                        subsection in which it 
                                        is applying for funds 
                                        under this subsection, 
                                        shall certify that it 
                                        is undertaking such 
                                        actions, including any 
                                        necessary procurement 
                                        procedures, to put in 
                                        place an Internet 
                                        safety policy and 
                                        technology protection 
                                        measures meeting the 
                                        requirements necessary 
                                        for certification under 
                                        subparagraphs (B) and 
                                        (C); and
                                          (bb) for the second 
                                        program year after the 
                                        effective date of this 
                                        subsection in which it 
                                        is applying for funds 
                                        under this subsection, 
                                        shall certify that it 
                                        is in compliance with 
                                        subparagraphs (B) and 
                                        (C).
                                  Any library that is unable to 
                                certify compliance with such 
                                requirements in such second 
                                program year shall be 
                                ineligible for services at 
                                discount rates or funding in 
                                lieu of services at such rates 
                                under this subsection for such 
                                second year and all subsequent 
                                program years under this 
                                subsection, until such time as 
                                such library comes into 
                                compliance with this paragraph.
                                  (III) Waivers.--Any library 
                                subject to subclause (II) that 
                                cannot come into compliance 
                                with subparagraphs (B) and (C) 
                                in such second year may seek a 
                                waiver of subclause (II)(bb) if 
                                State or local procurement 
                                rules or regulations or 
                                competitive bidding 
                                requirements prevent the making 
                                of the certification otherwise 
                                required by such subclause. A 
                                library, library board, or 
                                other authority with 
                                responsibility for 
                                administration of the library 
                                shall notify the Commission of 
                                the applicability of such 
                                subclause to the library. Such 
                                notice shall certify that the 
                                library in question will be 
                                brought into compliance before 
                                the start of the third program 
                                year after the effective date 
                                of this subsection in which the 
                                library is applying for funds 
                                under this subsection.
                  (F) Noncompliance.--
                          (i) Failure to submit 
                        certification.--Any library that 
                        knowingly fails to comply with the 
                        application guidelines regarding the 
                        annual submission of certification 
                        required by this paragraph shall not be 
                        eligible for services at discount rates 
                        or funding in lieu of services at such 
                        rates under this subsection.
                          (ii) Failure to comply with 
                        certification.--Any library that 
                        knowingly fails to ensure the use of 
                        its computers in accordance with a 
                        certification under subparagraphs (B) 
                        and (C) shall reimburse all funds and 
                        discounts received under this 
                        subsection for the period covered by 
                        such certification.
                          (iii) Remedy of noncompliance.--
                                  (I) Failure to submit.--A 
                                library that has failed to 
                                submit a certification under 
                                clause (i) may remedy the 
                                failure by submitting the 
                                certification to which the 
                                failure relates. Upon submittal 
                                of such certification, the 
                                library shall be eligible for 
                                services at discount rates 
                                under this subsection.
                                  (II) Failure to comply.--A 
                                library that has failed to 
                                comply with a certification as 
                                described in clause (ii) may 
                                remedy the failure by ensuring 
                                the use of its computers in 
                                accordance with such 
                                certification. Upon submittal 
                                to the Commission of a 
                                certification or other 
                                appropriate evidence of such 
                                remedy, the library shall be 
                                eligible for services at 
                                discount rates under this 
                                subsection.
          (7) Definitions.--For purposes of this subsection:
                  (A) Elementary and secondary schools.--The 
                term ``elementary and secondary schools'' means 
                elementary schools and secondary schools, as 
                defined in section 9101 of the Elementary and 
                Secondary Education Act of 1965.
                  (B) Health care provider.--The term ``health 
                care provider'' means--
                          (i) post-secondary educational 
                        institutions offering health care 
                        instruction, teaching hospitals, and 
                        medical schools;
                          (ii) community health centers or 
                        health centers providing health care to 
                        migrants;
                          (iii) local health departments or 
                        agencies;
                          (iv) community mental health centers;
                          (v) not-for-profit hospitals;
                          (vi) rural health clinics; [and]
                          (vii) skilled nursing facilities;
                          [(vii)](viii) consortia of health 
                        care providers consisting of one or 
                        more entities described in [clauses (i) 
                        through (vi)] clauses (i) through 
                        (vii).\1\
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    \1\Nothing in the amendment to subsection (h)(7)(B) would be 
construed to affect the aggregate annual cap on Federal universal 
service support for health care providers under section 54.675 of title 
47, Code of Federal Regulations, or any successor regulation.
---------------------------------------------------------------------------
                  (C) Public institutional telecommunications 
                user.--The term ``public institutional 
                telecommunications user'' means an elementary 
                or secondary school, a library, or a health 
                care provider as those terms are defined in 
                this paragraph.
                  (D) Minor.--The term ``minor'' means any 
                individual who has not attained the age of 17 
                years.
                  (E) Obscene.--The term ``obscene'' has the 
                meaning given such term in section 1460 of 
                title 18, United States Code.
                  (F) Child pornography.--The term ``child 
                pornography'' has the meaning given such term 
                in section 2256 of title 18, United States 
                Code.
                  (G) Harmful to minors.--The term ``harmful to 
                minors'' means any picture, image, graphic 
                image file, or other visual depiction that--
                          (i) taken as a whole and with respect 
                        to minors, appeals to a prurient 
                        interest in nudity, sex, or excretion;
                          (ii) depicts, describes, or 
                        represents, in a patently offensive way 
                        with respect to what is suitable for 
                        minors, an actual or simulated sexual 
                        act or sexual contact, actual or 
                        simulated normal or perverted sexual 
                        acts, or a lewd exhibition of the 
                        genitals; and
                          (iii) taken as a whole, lacks serious 
                        literary, artistic, political, or 
                        scientific value as to minors.
                  (H) Sexual act; sexual contact.--The terms 
                ``sexual act'' and ``sexual contact'' have the 
                meanings given such terms in section 2246 of 
                title 18, United States Code.
                  (I) Technology protection measure.--The term 
                ``technology protection measure'' means a 
                specific technology that blocks or filters 
                Internet access to the material covered by a 
                certification under paragraph (5) or (6) to 
                which such certification relates.

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