30082 Federal Register / Vol. 83, No. 124 / Wednesday, June 27, 2018 / Rules and Regulations 

Section 3(f) of Executive Order 12866 

defines a ‘‘significant regulatory action’’ 

as an action that is likely to result in a 

rule: (1) Having an annual effect on the 

economy of $100 million or more in any 

1 year, or adversely and materially 

affecting a sector of the economy, 

productivity, competition, jobs, the 

environment, public health or safety, or 

State, local or Tribal governments or 

communities (also referred to as 

‘‘economically significant’’); (2) creating 

a serious inconsistency or otherwise 

interfering with an action taken or 

planned by another agency; (3) 

materially altering the budgetary 

impacts of entitlement grants, user fees, 

or loan programs or the rights and 

obligations of recipients thereof; or (4) 

raising novel legal or policy issues 

arising out of legal mandates, the 

President’s priorities, or the principles 

set forth in the Executive Order. 

A regulatory impact analysis (RIA) 

must be prepared for major rules with 

economically significant effects ($100 

million or more in any 1 year). HHS 

submits that this final rule is not 

‘‘economically significant’’ as measured 

by the $100 million threshold, and 

hence not a major rule under the 

Congressional Review Act. This rule has 

not been designated as a ‘‘significant 

regulatory action’’ under Executive 

Order 12866. Accordingly, this rule has 

not been reviewed by the Office of 

Management and Budget (OMB). 

Executive Order 13771, titled 

‘‘Reducing Regulation and Controlling 

Regulatory Costs,’’ was issued on 

January 30, 2017. HHS identifies this 

final rule as a deregulatory action 

(removing an obsolete rule from the 

Code of Federal Regulations). For the 

purposes of Executive Order 13771, this 

final rule is not a substantive rule; 

rather it is administrative in nature and 

provides no cost savings. 

Executive Order 13777, titled 

‘‘Enforcing the Regulatory Reform 

Agenda,’’ was issued on February 24, 

2017. As required by Section 3 of this 

Executive Order, HHS established a 

Regulatory Reform Task Force (HHS 

Task Force). Pursuant to Section 3(d)(ii), 

the HHS Task Force evaluated this 

rulemaking and determined that these 

regulations are ‘‘outdated, unnecessary, 

or ineffective.’’ Following this finding, 

the HHS Task Force advised the HRSA 

Administrator to initiate this 

rulemaking to remove the obsolete 

regulations from the Code of Federal 

Regulations. 

Regulatory Flexibility Act 

This action will not have a significant 

economic impact on a substantial 

number of small entities. Therefore, the 

regulatory flexibility analysis provided 

for under the Regulatory Flexibility Act 

is not required. 

Paperwork Reduction Act 

This action does not affect any 

information collections. 

Dated: June 4, 2018. 

George Sigounas, 

Administrator, Health Resources and Services 

Administration. 

Approved: June 21, 2018. 

Alex M. Azar II, 

Secretary, Department of Health and Human 

Services. 

List of Subjects in 42 CFR Part 130 

Health care, Hemophilia, HIV/AIDS. 

PART 130—[REMOVED] 

■ For reasons set out in the preamble, 

and under the authority at 5 U.S.C. 301, 

HHS amends 42 CFR chapter I by 

removing part 130. 

[FR Doc. 2018–13836 Filed 6–26–18; 8:45 am] 

BILLING CODE 4165–15–P 

FEDERAL COMMUNICATIONS 

COMMISSION 

47 CFR Part 64 

[CG Docket Nos. 13–24 and 03–123; FCC 

18–79] 

IP CTS Modernization and Reform 

AGENCY: Federal Communications 

Commission. 

ACTION: Final rule and clarification. 

SUMMARY: In this document, the 

Commission alters the methodology for 

setting provider compensation rates for 

internet Protocol Captioned Telephone 

Service (IP CTS) and establishes interim 

compensation rates for Fund Years 

2018–19 and 2019–20. The Commission 

also adopts rules that address the 

provision of volume control on IP CTS 

devices, require the accuracy of IP CTS 

information disseminated by providers, 

and prohibit the provision of service to 

ineligible users. Finally, the 

Commission declares that speech-to-text 

automation, without the participation of 

a communications assistant (CA), may 

be used to generate IP CTS captions. 

DATES:

Effective dates: 47 CFR 64.604(c)(10) 

and (c)(13)(i)–(ii) are effective July 27, 

2018. The Commission will publish a 

document in the Federal Register 

announcing the effective date of 47 CFR 

64.604(c)(11)(v) and the amendments to 

47 CFR 64.604(c)(5)(iii)(D)(1), (6), and 

(c)(13)(iii)–(iv) of the Commission’s 

rules, which contain modified 

information collection requirements that 

have not yet been approved by the 

Office of Management and Budget 

(OMB) under the Paperwork Reduction 

Act of 1995 (PRA), Public Law 104–13. 

The IP CTS compensation rate adopted 

for the 2018–19 Fund Year shall be 

effective July 1, 2018. 

Applicability date: IP CTS providers 

must comply with the requirement to 

ensure that any volume control or other 

amplification feature can be adjusted 

separately and independently of the 

caption feature on or before December 8, 

2018. 

FOR FURTHER INFORMATION CONTACT: 

Michael Scott, Consumer and 

Governmental Affairs Bureau, FCC, at 

(202) 418–1264, or email 

Michael.Scott@fcc.gov. 

SUPPLEMENTARY INFORMATION: This is a 

summary of the Commission’s Report 

and Order and Declaratory Ruling in CG 

Docket Nos. 03–123 and 13–24; 

document FCC 18–79, adopted on June 

7, 2018 and released on June 8, 2018. 

Document FCC 18–79 concerns the 

modernization and reform of the 

Commission’s rules for IP CTS. The 

Commission previously sought 

comment on these issues in Misuse of 

internet Protocol (IP) Captioned 

Telephone Service; 

Telecommunications Relay Services and 

Speech-to-Speech Services for 

Individuals with Hearing and Speech 

Difficulties, published at 78 FR 54201, 

September 3, 2013 (2013 IP CTS Reform 

FNPRM). A Further Notice of Proposed 

Rulemaking (Further Notice) and Notice 

of Inquiry are contained in document 

FCC 18–79 and address additional 

issues concerning the funding, 

administration, and user eligibility for 

this service, as well as performance 

goals and metrics to ensure service 

quality for users. The Further Notice 

and Notice of Inquiry will be published 

elsewhere in the Federal Register. The 

full text of document FCC 18–79 will be 

available for public inspection and 

copying via the Commission’s 

Electronic Comment Filing System 

(ECFS), and during regular business 

hours at the FCC Reference Information 

Center, Portals II, 445 12th Street SW, 

Room CY–A257, Washington, DC 20554. 

To request materials in accessible 

formats for people with disabilities 

(Braille, large print, electronic files, 

audio format), send an email to fcc504@

fcc.gov, or call the Consumer and 

Governmental Affairs Bureau at (202) 

418–0530 (voice), (844) 432–2272 

(videophone), or (202) 418–0432 (TTY). 


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Congressional Review Act 

The Commission sent a copy of 

document FCC 18–79 to Congress and 

the Government Accountability Office 

pursuant to the Congressional Review 

Act, 5 U.S.C. 801(a)(1)(A). 

Final Paperwork Reduction Act of 1995 

Analysis 

The Report and Order in document 

FCC 18–79 contains modified 

information collection requirements, 

which are not effective until approval is 

obtained from OMB. The Commission, 

as part of its continuing effort to reduce 

paperwork burdens, will invite the 

general public to comment on these 

information collection requirements as 

required by the PRA. The Commission 

will publish a separate document in the 

Federal Register announcing approval 

of the information collection 

requirements. Pursuant to the Small 

Business Paperwork Relief Act of 2002, 

Public Law 107–198, 44 U.S.C. 

3506(c)(4), the Commission previously 

sought comment on how the 

Commission might ‘‘further reduce the 

information burden for small business 

concerns with fewer than 25 

employees.’’ 2013 IP CTS Reform 

FNPRM. 

Synopsis 

IP CTS Compensation 

1. IP CTS, a form of 

telecommunications relay services 

(TRS) supported by the Interstate TRS 

Fund (TRS Fund), allows individuals 

with hearing loss to both read captions 

and use their residual hearing to 

understand a telephone conversation. IP 

CTS providers receive compensation 

from the TRS Fund on a per-minute 

basis. The compensation rate has been 

determined using a methodology known 

as the Multistate Average Rate Structure 

(MARS) Plan, which calculates the 

weighted average per-minute 

compensation paid by state TRS 

programs to providers of intrastate CTS 

for the prior calendar year. 

2. The Commission’s mandate in 

determining TRS compensation rates is 

to ensure that the rates correlate to 

actual reasonable costs. MARS is no 

longer an effective methodology to 

accomplish this. The Commission 

therefore terminates use of the MARS 

methodology. 

3. The per-minute costs currently 

reported by IP CTS providers are not 

comparable to those for CTS—largely, it 

appears, because demand for IP CTS 

now greatly exceeds the demand for 

CTS. Specifically, from 2011 to 2017, 

annual CTS minutes declined from 

approximately 40 million to 19.9 

million, while annual IP CTS minutes 

grew from approximately 29 million to 

362 million—an amount that is more 

than 18 times greater than annual CTS 

minutes. Average per-minute expenses 

for IP CTS dropped from $2.0581 in 

2011 to $1.2326 in 2017, while the 

MARS rate increased from $1.7630 to 

$1.9467 for the same period. The 2017– 

18 MARS rate exceeds the average 2017 

IP CTS expenses by approximately 58 

percent. This divergence invalidates the 

rationale for continuing to use a MARSbased rate to determine IP CTS 

compensation. 

4. Setting a Rate Closer to Reasonable 

IP CTS Costs. The Commission finds it 

important to act without delay to bring 

provider compensation more in line 

with reported provider costs. IP CTS 

minutes have increased dramatically 

over the last nine years and the 

contribution base for the TRS Fund has 

been shrinking, requiring interstate and 

international telecommunications and 

VoIP service providers, and their 

subscribers, to contribute an ever-larger 

percentage of revenues to support these 

services. The Commission is also 

concerned that excessive compensation 

for IP CTS may increase provider 

incentives to recruit and register IP CTS 

users, regardless of their actual need for 

the service, leading to even greater 

potential for waste of TRS Fund dollars. 

5. The Commission concludes that the 

most recently filed cost and demand 

data are sufficiently reliable to serve as 

a basis for setting interim IP CTS rates. 

As with video relay service (VRS) 

compensation rates, a weighted average 

of the historical per-minute expenses 

reported by providers for 2017 and the 

projected per-minute expenses for 2018, 

which for IP CTS is approximately $1.28 

per minute, provides a reasonable 

baseline for taking initial steps to move 

the IP CTS compensation rate toward 

actual cost. Further, the Commission 

finds it reasonable to allow an operating 

margin between 7.6% to 12.35% for IP 

CTS providers in the same ‘‘zone of 

reasonableness’’ that applies to VRS 

providers given the service sector 

similarities between VRS and IP CTS, 

and that the bulk of costs for both are 

attributable to labor rather than capital. 

Adding an operating margin within that 

reasonable range to the average IP CTS 

expenses of $1.28 results in a total 

average cost between approximately 

$1.38 and $1.44. 

6. While the Commission’s goal is to 

move the IP CTS rate to a cost-based 

level, immediately reducing the IP CTS 

compensation rate to this extent could 

produce a disruption in the IP CTS 

market and potentially negative 

consequences for both providers and 

consumers. Initial rate reductions of 

approximately 10 percent per year, over 

two years, will strike a reasonable 

balance between the need to bring IP 

CTS rates in line with costs and reduce 

the TRS Fund contribution burden, and 

avoiding rate shock for IP CTS providers 

and potential disruption of the 

provision and quality of service for 

consumers. This approach will allow a 

reasonable opportunity for higher-cost 

providers to adjust to average-cost-based 

compensation by reducing unnecessary 

expenses—and thereby encourage 

multiple providers to remain in the IP 

CTS market. Finally, allowing the 

compensation rate to stay, for the 

present, at levels well above average 

allowable costs allows IP CTS providers 

to continue participating in research 

and thus will ‘‘not discourage or impair 

the development of improved 

technology.’’ 47 U.S.C. 225(d)(2). 

7. Applying these interim rates for a 

period of two years will allow the 

Commission to fully evaluate the 

appropriateness of some categories of 

allowable costs for this service, as well 

as the extent to which compensation for 

this service should be subject to pricecap-index adjustments. In addition, this 

period will afford the Commission an 

opportunity to determine how best a 

fully automated method of providing IP 

CTS should be compensated. 

8. The Commission directs that the IP 

CTS compensation rate be reduced in 

two steps of approximately 10 percent 

each: First, a $0.19467 reduction from 

the $1.9467 per minute rate currently in 

effect, to a rate of $1.75 per minute for 

the 2018–19 Fund Year, from July 1, 

2018, to June 30, 2019; and second, a 

further $0.17 reduction of the 

compensation rate from $1.75 to $1.58 

per minute for the 2019–20 Fund Year, 

from July 1, 2019, to June 30, 2020. 

These reductions will save the TRS 

Fund a minimum of $399 million over 

two years, as compared to applying the 

MARS rate. If the Commission finds that 

actual costs are substantially below the 

interim rates, the Commission may 

adjust those rates accordingly. 

9. While the use of provider cost data 

adds complexity, and may require 

detailed analysis, it would not be 

reasonable for the Commission, in order 

to avoid such complexity, to continue to 

rely on a proxy that does not bear a 

reasonable relationship to actual costs. 

Any burden arising from switching to a 

more complex rate methodology is 

outweighed by the benefits of having a 

more accurate compensation rate, 

including the benefit of savings to the 

Fund. 

10. Setting interim rates for two years, 

rather than a single year, will provide a 


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greater degree of rate certainty for 

providers and can mitigate the risk of 

rewarding inefficiency, discouraging 

innovation, and incentivizing providers 

to incur unnecessary costs, all potential 

effects of annual cost-of-service rate 

setting. A multi-year approach allows 

individual providers to gain additional 

profit during each multi-year period 

from any innovations and efficiency 

enhancing measures that reduce their 

per-minute costs during that period. 

11. The TRS Fund administrator’s 

cost calculations used to establish the 

interim rates are based on the same 

categories of provider costs that 

generally have been deemed allowable 

in calculating rates for other forms of 

TRS. Provider objections to these 

categories raise no significant arguments 

that have not been addressed and 

previously resolved in the 

Commission’s prior rulings. 

12. Collecting Additional Cost 

Information for Setting Future IP CTS 

Rates. The Commission remains 

concerned that some of the expenses 

incurred by IP CTS providers have not 

been reported in sufficient detail to 

enable the Fund administrator to 

confirm their allowability and 

reasonableness. Some IP CTS providers, 

who contract with other entities for the 

provision of call centers, CA staffing, 

and other services, as well as the 

licensing of intellectual property, report 

payments to contractors as 

‘‘subcontractor expenses,’’ with no 

breakdown into specific expense 

reporting categories. Given that the 

expenses classified in this manner 

comprise an unusually large portion of 

total reported IP CTS costs, such 

reporting obscures the nature of a 

substantial portion of reported IP CTS 

costs and hinders review of such costs 

incurred by such providers to assess 

their allowability and reasonableness. 

Accordingly, the Commission directs 

the TRS Fund administrator to require 

IP CTS providers that contract for the 

supply of services used in the provision 

of TRS to include information about 

payments under such contracts 

classified according to the substantive 

cost categories specified by the 

administrator, including, e.g., allocation 

of subcontractor expenses between call 

center expenses and intellectual 

property licensing fees, and how the 

provider determined or calculated the 

portion of contractual payments 

attributable to each cost category. All 

cost reports submitted in the future by 

IP CTS providers shall provide such a 

breakdown and explanation. The 

Commission also directs the Fund 

administrator, to the extent that the 

administrator reasonably deems 

necessary for the purpose of 

determining the allowability and 

reasonableness of costs reported to be 

incurred in the provision of TRS, to 

require providers to submit additional 

detail on such contractor expenses, 

including the submission of complete 

copies of such contracts and related 

correspondence or other records and 

information relevant to determining the 

nature of the services provided and the 

allocation of the costs of such services 

to cost categories. This additional 

transparency will help the Commission 

ensure that the costs reported by 

providers are reasonable. 

13. The Commission believes that its 

current authority to collect the above 

information is contained in rules that 

require TRS providers to provide the 

TRS Fund administrator ‘‘true and 

adequate data, and other historical, 

projected and state rate related 

information reasonably requested to 

determine the TRS Fund revenue 

requirements and payments,’’ and 

which authorize both the TRS Fund 

administrator and the Commission ‘‘to 

examine and verify TRS provider data 

as necessary to assure the accuracy and 

integrity of TRS Fund payments.’’ 47 

CFR 64.604(c)(5)(iii)(D)(1), (6). To 

further clarify such authority, however, 

and to provide for greater consistency in 

the rules, the Commission amends its 

rules to explicitly provide for the 

collection of information laid out in the 

preceding paragraph. In addition, the 

Commission further amends its rules to 

provide that, in the course of an audit 

or otherwise upon demand, an IP CTS 

provider must make documentation, 

including contracts with entities 

providing services or equipment 

directly related to the provision of IP 

CTS, available to the Commission, the 

TRS Fund administrator, or any person 

authorized by the Commission or TRS 

Fund administrator to conduct an audit. 

Measures To Limit Unnecessary IP CTS 

Use and Waste of the TRS Fund 

14. The dramatic growth in IP CTS 

call volume appears to result in part 

from provider practices that promote 

over-use of IP CTS, including by people 

with hearing loss who may be able to 

achieve functionally equivalent 

telephone service using other forms of 

off-the-shelf or assistive technologies. 

The Commission concludes that the 

following steps are needed to minimize 

such unnecessary use, and the 

consequent waste of TRS Fund 

resources. 

15. Volume Control and Caption 

Settings. The Commission amends its 

rules to prohibit IP CTS providers from 

linking the volume control and 

captioning functions of an IP CTS 

device or software application. 

Allowing users to enable volume control 

only when captions are turned on 

promotes waste, in that it forces the 

costly generation of captions even when 

the user only requires increased volume 

to communicate effectively by phone. In 

addition, decoupling these features will 

enable consumers who are not 

registered IP CTS users to access the 

amplification features of IP CTS devices 

without the captions. Compliance with 

a delinking requirement will not impose 

a substantial cost on IP CTS providers, 

and any likely cost will be more than 

offset by the efficiency gain resulting 

from the reduction in unnecessary 

captioning services. 

16. The compliance deadline for 

making this change is December 8, 2018. 

IP CTS providers must ensure that all IP 

CTS devices—as well as user software 

for such devices—that they newly 

distribute to users after December 8, 

2018 are configured to allow volume 

control to be adjusted independently of 

the captioning feature. The Commission 

also requires providers to ensure that all 

previously distributed devices are 

delinked by December 8, 2018. 

17. Website, Advertising and 

Educational Information Notifications. 

The Commission amends its rules to 

require IP CTS providers to include both 

of the following factual notifications in 

a clear and prominent location on their 

advertising brochures, websites, user 

manuals, and other informational 

materials and websites: 

• IP captioned telephone service may 

use a live operator. The operator 

generates captions of what the other 

party to the call says. These captions are 

then sent to your phone. 

• There is a cost for each minute of 

captions generated, paid from a 

federally administered fund. 

The first part of the notification is not 

required from those IP CTS providers 

who do not use live CAs. In the case of 

websites, The Commission requires 

such language to be included on the 

home page, each page that provides 

consumer information about IP CTS, 

and each page that provides information 

on how to order IP CTS or IP CTS 

equipment. 

18. Requiring these notifications will 

enhance the Commission’s efforts to 

prevent casual or inadvertent use of IP 

CTS and will not impose a significant 

burden that outweighs their benefits. 

When captioning devices are turned on 

by default, it is critical to make potential 

users aware through ‘‘multiple and 

repeated sources of information’’ that IP 

CTS involves significant costs and must 

not be used by individuals who do not 


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need it. Persons that truly need this free 

service for functionally equivalent 

telephone service have every incentive 

to obtain it. Rather than deter IP CTS 

use by such individuals, these notices 

will help to ensure that individuals who 

might be attracted to it are aware of its 

functions and financing. 

19. General Prohibition on Providing 

Service to Users Who Do Not Need It. 

The Commission modifies the current 

prohibition on VRS providers engaging 

in fraudulent, abusive, and wasteful 

practices by amending it to include IP 

CTS providers. As amended, the rule 

prohibits both IP CTS and VRS 

providers from engaging in practices 

that the provider knows or has reason to 

know will cause or encourage (1) the 

unauthorized use of TRS, (2) false or 

unverified TRS Fund compensation 

claims, (3) the making of TRS calls that 

would not otherwise be made, and (4) 

the use of TRS by consumers who do 

not need the service in order to 

communicate by telephone in a 

functionally equivalent manner. 

20. The Commission clarifies that 

‘‘unauthorized use’’ of IP CTS, under 

clause (1) above, means use by an 

individual who is not registered with a 

provider. Further, a practice is 

prohibited where it artificially 

stimulates TRS usage, enables or 

encourages participation by 

unauthorized users, or uses financial 

incentives to attract new TRS users or 

to increase usage. However, the 

Commission allows IP CTS providers to 

be compensated for calls made by 

unregistered users when such calls are 

made from temporary, public IP CTS 

devices set up in emergency shelters. 

When service for such a device is 

initiated at the shelter, the IP CTS 

provider must notify the TRS Fund 

administrator of the date of such 

activation and termination. 

21. In addition, an IP CTS provider 

shall not seek payment from the TRS 

Fund for any minutes of service that it 

knows or has reason to know are 

resulting from such prohibited 

practices. Any IP CTS provider that 

becomes aware of such practices being 

or having been committed by any 

person shall, as soon as practicable, 

report such practices to the Commission 

or the TRS Fund administrator. All 

monies paid from the TRS Fund to 

providers who are found by the 

Commission to be in violation of this 

new IP CTS rule shall be recoverable by 

the TRS Fund administrator, and such 

providers may also be subject to 

forfeitures and other enforcement 

actions. 

Declaratory Ruling on Automatic 

Speech Recognition 

22. In document FCC 18–79, the 

Commission determines that the 

provision of CTS and IP CTS using 

automated speech recognition (ASR) to 

generate captions without the 

involvement of a CA is a form of relay 

service eligible for compensation from 

the TRS Fund if provided in compliance 

with applicable TRS mandatory 

minimum standards. Specifically, the 

Commission concludes that such 

services are included within the 

statutory definition of TRS, as 

‘‘telephone transmission services that 

provide the ability’’ to engage in 

communication by wire or radio ‘‘in a 

manner that is functionally equivalent’’ 

to voice communications service. 47 

U.S.C. 225(a)(3). 

Benefits of ASR 

23. The use of ASR to generate 

captions for CTS and IP CTS has several 

benefits. First, ASR can better achieve 

near simultaneous communication than 

is possible with CA-assisted captions. 

Second, the substantially lower costs of 

operation for ASR can allow for the 

provision of IP CTS with far greater 

efficiency. Finally, as a fully automated 

method of generating captions that is 

not dependent on human intervention, 

ASR can allow enhanced call privacy 

and ensure the seamless continuation of 

communications when exigent 

circumstances, such as severe weather 

events, threaten IP CTS call center 

operations. 

24. Improvements in accuracy, 

coupled with ASR’s advantages in speed 

and privacy, have made ASR a viable 

alternative to the use of human relay 

intermediaries for CTS and IP CTS. IP 

CTS providers and others have shown 

heightened interest in utilizing this 

method for the provision of captions, 

and the Commission has received two 

applications for certification to provide 

IP CTS using ASR. Additionally, ASRonly products are being trialed and 

adopted internationally as a means of 

generating captions from speech, for 

people with hearing and speech 

disabilities. 

25. The Commission is not mandating 

ASR as the sole means of offering IP 

CTS. IP CTS providers will be able to 

choose among three methods of 

providing Fund-supported IP CTS: (1) IP 

CTS using fully automated ASR; (2) IP 

CTS using CA-assisted ASR; and (3) 

stenographic-supported IP CTS. 

Consumers will continue to be able to 

select an IP CTS provider based on the 

overall quality of service each provider 

offers by means of the available 

methods. As IP CTS providers begin 

offering fully automated ASR, the 

Commission will be able to gather data 

that can inform the Commission’s 

adoption of further measures to improve 

its utility. Any provider offering ASR 

must ensure that its service complies 

with the mandatory minimum standards 

of § 64.604 of the Commission’s rules in 

order to obtain and retain certification 

to provide IP CTS. 

Consistency With Commission 

Precedent 

26. The use of ASR is consistent with 

the Commission’s prior rulings 

authorizing CTS in both its analog and 

internet forms. The definition of IP CTS 

does not specify how captions must be 

generated, including whether they 

should be generated through automation 

or human-assisted methods. In this 

regard, the Commission already has 

approved a form of IP CTS that relies on 

automated speech recognition programs 

(assisted by CAs) to convert speech to 

captions during an IP CTS call. The only 

differences between ASR and CAassisted ASR is that with CA-assisted 

ASR, CAs ‘‘train’’ speech recognition 

programs to understand their voices 

when they re-voice a caller’s speech, 

and have a limited opportunity to make 

corrections to the captions that are 

produced. Advancements in ASR 

reduce the need for such training and 

human editing, and use of this 

technology for IP CTS without CA 

involvement does not fundamentally 

change the functional role of the service, 

which is to produce captions from a 

user’s speech. 

Statutory Authority 

27. Using ASR for the provision of IP 

CTS is fully consistent with the 

Commission’s statutory authority. The 

provision of IP CTS utilizing ASR will 

contribute to functional equivalence by 

enabling providers to enhance the 

privacy, ensure seamless 

communications, and reduce the latency 

of IP CTS offerings. Section 225 of the 

Act is neutral as to the technology and 

method used to achieve functional 

equivalency and expressly requires the 

Commission to encourage technological 

innovation in TRS. Further, offering an 

ASR option that will largely eliminate 

personnel costs associated with IP CTS 

will help fulfill Congress’s directive to 

provide TRS in the most efficient 

manner. 

Provider Certification and Other 

Requirements 

28. The Commission authorizes the 

Consumer and Governmental Affairs 

Bureau (Bureau) to review and approve 


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applications for certification to provide 

IP CTS by means of ASR in whole or in 

part. The Bureau may determine on a 

case-by-case basis the extent to which 

an applicant’s proposed method of 

providing ASR will enable it to provide 

IP CTS in a manner that meets the 

Commission’s minimum TRS standards 

for functionally equivalent service. To 

assist the Bureau in making this 

assessment, where use of ASR in 

conjunction with CA-assisted caption 

generation is proposed, applicants 

should include in their certification 

applications a detailed description of 

the criteria that will be used to 

determine when to use and transfer 

between each of these methods. 

Applicants should support all claims 

regarding their use of ASR and its 

efficacy through documentary and other 

evidence and should provide 

information about measures they will 

take to ensure the confidentiality of call 

content. The Bureau will not approve 

any application to provide IP CTS using 

ASR that does not demonstrate that the 

applicant will meet the Commission’s 

mandatory minimum standards for 

functional equivalency. 

29. Certifications for the provision of 

IP CTS using ASR may be granted on a 

conditional basis, to enable the 

Commission’s assessment of an 

applicant’s actual performance in 

meeting or exceeding the mandatory 

minimum standards. In addition, to the 

extent deemed necessary, certification 

of a provider may be conditioned on the 

submission of periodic data to help 

confirm whether ASR-driven IP CTS is 

providing functionally equivalent 

service. 

30. If a currently operating IP CTS 

provider wishes to incorporate ASR in 

its offerings, it must first receive 

approval from the Bureau to provide IP 

CTS in this manner. In order to obtain 

approval, any provider operating under 

conditional certification or interim 

eligibility must update its application 

for permanent certification to describe 

the change, and may be asked to provide 

additional data—beyond what was 

submitted in its initial application for 

certification—to demonstrate how 

modifications to its service will ensure 

the provision of a relay service that is 

functionally equivalent to voice 

telephone service through compliance 

with the Commission’s mandatory 

minimum standards. 

Compensation 

31. The Commission reminds all 

providers that its rules require TRS 

providers seeking compensation from 

the TRS Fund to ‘‘provide the 

administrator with true and adequate 

data, and . . . information reasonably 

requested to determine the TRS Fund 

revenue requirements and payments.’’ 

47 CFR 64.604(c)(5)(iii)(D)(1). Requests 

from the TRS Fund administrator for 

information that would help establish 

whether payments are justified and help 

determine the costs for ASR IP CTS 

could reasonably include: 

• A breakdown, in the provider’s 

monthly call detail report, indicating 

minutes for which ASR is substituted 

for CA-assisted IP CTS; 

• Estimates of the difference in the 

costs incurred to handle ASR and CAassisted calls, with a detailed 

breakdown of the specific variable costs 

incurred for each type of call, as well as 

underlying assumptions and 

calculations; and 

• Documentation of incremental costs 

incurred in providing ASR, including 

any incremental costs associated with 

engineering and technical 

implementation, marketing, 

administrative and management support 

(including oversight, evaluation, and 

recordkeeping) and, for hybrid forms of 

IP CTS, any costs associated with 

enabling transfers back and forth 

between ASR and CA-assisted IP CTS. 

Final Regulatory Flexibility Analysis 

32. As required by the Regulatory 

Flexibility Act of 1980, as amended, the 

Commission incorporated an Initial 

Regulatory Flexibility Analysis (IRFA) 

into the 2013 IP CTS Reform FNPRM. 

The Commission sought written public 

comment on the proposals in the 2013 

IP CTS Reform FNPRM, including 

comment on the IRFA. No comments 

were received in response to the IRFA. 

Need For, and Objectives of, the Rules 

33. Document FCC 18–79 adopts an 

interim rate for IP CTS reflecting a 

weighted, cost-of-service methodology 

based on an analysis of providers’ actual 

and projected costs. 

34. In addition, the Commission 

directs the TRS Fund administrator to 

require IP CTS providers that contract 

for the supply of services used in the 

provision of TRS to include information 

about payments under such contracts 

classified according to the substantive 

cost categories specified by the 

administrator. 

35. Document FCC 18–79 also adopts 

three rule changes to facilitate the 

Commission’s efforts to reduce waste, 

fraud, and abuse and improve its ability 

to efficiently manage the IP CTS 

program. First, the Commission 

prohibits linking volume control and 

captioning use on IP CTS devices. 

Second, the Commission requires IP 

CTS providers to include the following 

notifications in a clear and prominent 

location on their advertising brochures, 

websites, user manuals, and other 

informational materials and websites: 

• IP captioned telephone service may 

use a live operator. The operator 

generates captions of what the other 

party to the call says. These captions are 

then sent to your phone. 

• There is a cost for each minute of 

captions generated, paid from a 

federally administered fund. 

The first part of the notification is not 

required from those IP CTS providers 

who do not use live CAs. Third, the 

Commission adopts a general 

prohibition against providing IP CTS to 

consumers who do not genuinely need 

the service. Providers that become 

aware of prohibited practices must 

report them to the Commission or the 

TRS Fund administrator. 

Summary of Significant Issues Raised by 

Public Comments in Response to the 

IRFA 

36. No comments were filed in 

response to the IRFA. 

Response to Comments by the Chief 

Counsel for Advocacy of the Small 

Business Administration 

37. The Chief Counsel for Advocacy 

of the Small Business Administration 

did not file any comments in response 

to the proposed rules in this proceeding. 

Small Entities Impacted 

38. The rules adopted in document 

FCC 18–79 will affect obligations of IP 

CTS providers. These services can be 

included within the broad economic 

category of All Other 

Telecommunications. 

Description of Projected Reporting, 

Recordkeeping, and Other Compliance 

Requirements 

39. The rule implementing a general 

prohibition against providing IP CTS to 

consumers who do not genuinely need 

the service and the requirement to 

separate volume control and captioning 

functions on IP CTS devices do not 

create direct reporting, recordkeeping or 

other compliance requirements on IP 

CTS providers. 

40. In transitioning away from the 

MARS methodology for IP CTS, the 

Commission will require IP CTS 

providers to file annual cost and 

demand data reports with the TRS Fund 

administrator. There is no additional 

burden on IP CTS providers to file these 

reports, as IP CTS providers have been 

voluntarily submitting such reports to 

the TRS Fund administer since 2011. 

The Commission has received approval 

to require the collection of such 


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information pursuant to the PRA, and 

the Commission is requiring the IP CTS 

providers to submit their cost and 

demand data for 2017. In addition, the 

Commission is requiring providers to 

supplement their cost data filings with 

information about payments made by 

providers to subcontractors for the 

provision of call centers, CA staffing, 

and other services by classifying such 

payments according to the substantive 

cost categories specified by the 

administrator. These requirements, 

which place minimal additional filing 

burdens on IP CTS providers, will be 

offset by the benefit to the TRS Fund 

and its contributors by the increased 

precision of calculating cost-based rates 

resulting from increased accuracy of 

TRS cost data submitted to the TRS 

Fund administrator. 

41. The adoption of a requirement for 

IP CTS providers to include a notice on 

IP CTS websites and informational 

materials to inform consumers about the 

process, cost, and source of funding will 

place only a minimal burden on IP CTS 

providers. It will be offset by the benefit 

to the TRS Fund and contributors to the 

Fund resulting from the reduction of 

casual or inadvertent use of IP CTS that 

such notice may provide by educating 

consumers via multiple sources of 

information. 

42. The requirement for providers that 

become aware of prohibited practices to 

report them to the Commission or the 

TRS Fund administrator should not be 

burdensome and is needed to prevent 

waste, fraud, and abuse of the TRS 

Fund. 

Steps Taken To Minimize Significant 

Impact on Small Entities, and 

Significant Alternatives Considered 

43. The interim rates for IP CTS will 

apply only to providers who are or may 

become certified by the Commission to 

offer IP CTS in accordance with its 

rules. The Commission adopts these 

interim rates to: (1) Ensure that rates 

compensate providers for their 

reasonable cost; (2) reduce waste of TRS 

Fund resources and the amounts that 

TRS Fund contributors pay to the fund; 

and (3) ensure that TRS is made 

available to the extent possible and in 

the most efficient manner. The 

requirement to file cost and demand 

data annually will not increase the 

burden on IP CTS providers because 

they have been submitting such data to 

the TRS Fund administrator since 2011. 

The Commission is requiring providers 

to supplement their cost data filings 

with information about payments made 

by providers to subcontractors for the 

provision of call centers, CA staffing, 

and other services by classifying such 

payments according to the substantive 

cost categories specified by the 

administrator. This requirement, which 

places minimal additional filing 

burdens on IP CTS providers, will be 

offset by the benefit to the TRS Fund 

and its contributors by the increased 

precision of calculating cost-based rates 

resulting from increased accuracy of 

TRS cost data submitted to the TRS 

Fund administrator. 

44. Separating the volume control and 

captioning functions on IP CTS devices 

will place a minor burden on IP CTS 

providers and device manufacturers to 

reconfigure the functionality. Such costs 

will be offset from the likely decrease in 

waste and misuse of IP CTS, as 

individuals will be able to use a device’s 

amplification features without also 

being required to use the device’s 

captioning features. Providers have until 

December 8, 2018, to ensure that new 

and previously distributed devices are 

in compliance. 

45. The general prohibition on 

practices resulting in IP CTS use by 

ineligible individuals, the requirement 

for providers that become aware of 

prohibited practices to report them to 

the Commission or the TRS Fund 

administrator, and the requirement for 

IP CTS providers to include notices on 

their informational materials and 

websites should not be burdensome and 

are necessary to combat waste, fraud, 

and abuse. These requirements will help 

ensure the efficiency of the TRS 

program, control the expenditure of 

public funds, reduce the amounts paid 

by contributors to the TRS Fund, and 

ensure the future viability of the TRS 

Fund and the provision of IP CTS. 

Federal Rules Which Duplicate, 

Overlap, or Conflict With, the 

Commission’s Proposals 

46. None. 

Ordering Clauses 

Pursuant to sections 1, 2, 201(b), and 

225 of the Communications Act of 1934, 

as amended, 47 U.S.C. 151, 152, 201(b), 

225, document FCC 18–79 is adopted, 

and part 64 of Title 47 is amended. 

The Commission’s Consumer and 

Governmental Affairs Bureau, Reference 

Information Center, shall send a copy of 

document FCC 18–79, including the 

Final Regulatory Flexibility Analysis, to 

the Chief Counsel for Advocacy of the 

Small Business Administration. 

List of Subjects in 47 CFR Part 64 

Individuals with disabilities, 

Telecommunications. 

Federal Communications Commission. 

Marlene Dortch, 

Secretary, Office of the Secretary. 

Final Rules 

For the reasons discussed in the 

preamble, the Federal Communications 

Commission amends 47 CFR part 64 as 

follows: 

PART 64—MISCELLANEOUS RULES 

RELATING TO COMMON CARRIERS 

■ 1. The authority citation for part 64 

continues to read as follows: 

Authority: 47 U.S.C. 154, 202, 225, 251(e), 

254(k), 403(b)(2)(B), (c), 616, 620, Pub. L. 

104–104, 110 Stat. 56. Interpret or apply 47 

U.S.C. 201, 202, 218, 222, 225, 226, 227, 228, 

251(e), 254(k), 616, 620, and the MiddleClass Tax Relief and Job Creation Act of 

2012, Pub. L. 112–96, unless otherwise 

noted. 

■ 2. Amend § 64.604 by revising 

paragraphs (c)(5)(iii)(D)(1) and (6), 

(c)(10), adding paragraph (c)(11)(v), and 

revising paragraph (c)(13) to read as 

follows: 

§ 64.604 Mandatory minimum standards. 

* * * * * 

(c) * * * 

(5) * * * 

(iii) * * * 

(D) Data collection and audits. (1) 

TRS providers seeking compensation 

from the TRS Fund shall provide the 

administrator with true and adequate 

data, and other historical, projected and 

state rate related information reasonably 

requested to determine the TRS Fund 

revenue requirements and payments. 

TRS providers shall provide the 

administrator with the following: total 

TRS minutes of use, total interstate TRS 

minutes of use, total TRS investment in 

general in accordance with part 32 of 

this chapter, and other historical or 

projected information reasonably 

requested by the administrator for 

purposes of computing payments and 

revenue requirements. In annual cost 

data filings and supplementary 

information provided to the 

administrator regarding such cost data, 

IP CTS providers that contract for the 

supply of services used in the provision 

of TRS shall include information about 

payments under such contracts, 

classified according to the substantive 

cost categories specified by the 

administrator. To the extent that a third 

party’s provision of services covers 

more than one cost category, the 

resubmitted cost reports must provide 

an explanation of how the provider 

determined or calculated the portion of 

contractual payments attributable to 

each cost category. To the extent that 


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the administrator reasonably deems 

necessary, providers shall submit 

additional detail on such contractor 

expenses, including but not limited to 

complete copies of such contracts and 

related correspondence or other records 

and information relevant to determining 

the nature of the services provided and 

the allocation of the costs of such 

services to cost categories. 

* * * * * 

(6) Audits. The Fund administrator 

and the Commission, including the 

Office of Inspector General, shall have 

the authority to examine and verify TRS 

provider data as necessary to assure the 

accuracy and integrity of TRS Fund 

payments. TRS providers must submit 

to audits annually or at times 

determined appropriate by the 

Commission, the fund administrator, or 

by an entity approved by the 

Commission for such purpose. A TRS 

provider that fails to submit to a 

requested audit, or fails to provide 

documentation necessary for 

verification upon reasonable request, 

will be subject to an automatic 

suspension of payment until it submits 

to the requested audit or provides 

sufficient documentation. In the course 

of an audit or otherwise upon demand, 

an IP CTS provider must make available 

any relevant documentation, including 

contracts with entities providing 

services or equipment directly related to 

the provision of IP CTS, to the 

Commission, the TRS Fund 

administrator, or any person authorized 

by the Commission or TRS Fund 

administrator to conduct an audit. 

* * * * * 

(10) IP CTS settings. Each IP CTS 

provider shall ensure that, for each IP 

CTS device it distributes, directly or 

indirectly: 

(i) The device includes a button, key, 

icon, or other comparable feature that is 

easily operable and requires only one 

step for the consumer to turn on 

captioning; and 

(ii) On or after December 8, 2018, any 

volume control or other amplification 

feature can be adjusted separately and 

independently of the caption feature. 

(11) * * * 

(v) IP CTS providers shall ensure that 

their informational materials and 

websites used to market, advertise, 

educate, or otherwise inform consumers 

and professionals about IP CTS include 

the following language in a prominent 

location in a clearly legible font: 

‘‘FEDERAL LAW PROHIBITS ANYONE 

BUT REGISTERED USERS WITH 

HEARING LOSS FROM USING 

INTERNET PROTOCOL (IP) 

CAPTIONED TELEPHONES WITH THE 

CAPTIONS TURNED ON. IP Captioned 

Telephone Service may use a live 

operator. The operator generates 

captions of what the other party to the 

call says. These captions are then sent 

to your phone. There is a cost for each 

minute of captions generated, paid from 

a federally administered fund.’’ For IP 

CTS provider websites, the language 

shall be included on the website’s home 

page, each page that provides consumer 

information about IP CTS, and each 

page that provides information on how 

to order IP CTS or IP CTS equipment. 

IP CTS providers that do not make any 

use of live CAs to generate captions may 

shorten the notice to leave out the 

second, third, and fourth sentences. 

* * * * * 

(13) Unauthorized and unnecessary 

use of VRS or IP CTS. (i) A VRS or IP 

CTS provider shall not engage in any 

practice that the provider knows or has 

reason to know will cause or encourage: 

(A) False or unverified claims for TRS 

Fund compensation; 

(B) Unauthorized use of VRS or IP 

CTS; 

(C) The making of VRS or IP CTS calls 

that would not otherwise be made; or 

(D) The use of VRS or IP CTS by 

persons who do not need the service in 

order to communicate in a functionally 

equivalent manner. 

(ii) A VRS or IP CTS provider shall 

not seek payment from the TRS Fund 

for any minutes of service it knows or 

has reason to know are resulting from 

the practices listed in paragraph 

(c)(13)(i) of this section or from the use 

of IP CTS by an individual who does not 

need captions to communicate in a 

functionally equivalent manner. 

(iii) Any VRS or IP CTS provider that 

becomes aware of any practices listed in 

paragraphs (c)(13)(i) or (ii) of this 

section being or having been committed 

by any person shall, as soon as 

practicable, report such practices to the 

Commission or the TRS Fund 

administrator. 

(iv) An IP CTS provider may complete 

and request compensation for IP CTS 

calls to or from unregistered users at a 

temporary, public IP CTS device set up 

in an emergency shelter. The IP CTS 

provider shall notify the TRS Fund 

administrator of the dates of activation 

and termination for such device. 

* * * * * 

[FR Doc. 2018–13753 Filed 6–26–18; 8:45 am] 

BILLING CODE 6712–01–P 


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