Source: https://www.federalregister.gov/documents/2015/03/26/2015-06642/connect-america-fund-developing-a-unified-intercarrier-compensation-regime
Timestamp: 2017-09-21 18:51:26
Document Index: 453692046

Matched Legal Cases: ['§\u200951', '§\u200951', '§\u200951', '§\u200951', '§\u20090', 'art 51', '§\u200951', '§\u200951']

A Rule by the Federal Communications Commission on 03/26/2015
15906-15909 (4 pages)
https://www.federalregister.gov/d/2015-06642 https://www.federalregister.gov/d/2015-06642
This is a summary of the Commission's Order in WC Docket No. 10-90 and CC Docket No. 01-92, adopted and released on February 24, 2015. The full text of this document can be viewed at the following Internet address: https://apps.fcc.gov/​edocs_​public/​attachmatch/​DA-15-249A1.docx. The full text of this document is also available for public inspection during regular business hours in the FCC Reference Center, 445 12th Street SW., Room CY-A257, Washington, DC 20554. To request materials in accessible formats for people with disabilities (e.g. braille, large print, electronic files, audio format, etc.) or to request reasonable accommodations (e.g. accessible format documents, sign language interpreters, CART, etc.), send an email to fcc504@fcc.gov or call the Consumer & Governmental Affairs Bureau at (202) 418-0530 (voice) or (202) 418-0432 (TTY).
1. In the USF/ICC Transformation Order, the Commission delegated to the Wireline Competition Bureau (Bureau) the authority to make any rule revisions Start Printed Page 15907necessary to ensure that the intercarrier compensation (ICC) reforms adopted by the Commission are properly reflected in the Commission's rules, including correction of any conflicts between the new or revised rules and addressing any omissions or oversights. In the Order, the Bureau acts pursuant to its delegated authority to clarify certain rules relating to implementation of the ICC transition for rate-of-return local exchange carriers (LECs) adopted in the USF/ICC Transformation Order. We clarify the Commission's rules governing Eligible Recovery calculations under § 51.917(d) to address a limited number of unanticipated results associated with application of the true-up process that became apparent in rate-of-return carriers' 2014 annual access tariff filings. Specifically, we clarify that a rate-of-return carrier that received too much Eligible Recovery in 2012-13 because of an under-projection of demand for that tariff period, and does not have sufficient Eligible Recovery in 2014-15 to fully offset the 2012-13 amount of over-recovery, must refund the amount that is not offset to the Universal Service Administrative Company (USAC) to avoid duplicative recovery. Additionally, to ensure a carrier receives the Eligible Recovery it was entitled to in 2012-13, we clarify that a rate-of-return carrier that received too little Eligible Recovery in 2012-13 because of an over-projection of demand for that tariff period may seek recovery for any amounts it was not able to recover through its 2014-15 Eligible Recovery from USAC. We also revise § 51.917 of the Commission's rules to address similar discrepancies that may occur in future years as a result of the true-up process.
5. To provide context for how the true-up process works, the following two examples demonstrate scenarios in which the carrier either under-projected or over-projected its revenues, and thus must engage in a true-up calculation pursuant to § 51.917(d)(1)(iii)-(iv) of the Commission's rules. In this first example, Carrier A under-projected its actual revenues and received too much Eligible Recovery for the 2012-2013 tariff period. Carrier A had a BPR of $100.00, a projected revenue amount of $80.00 and an actual revenue amount of $85.00:
2012-2013 BPR is $100.00 × .95 = $95.00 (Adjusted BPR)
2012-2013 Total Projected Revenues = $80.00
2012-2013 Eligible Recovery (Adjusted BPR-Projected Revenues) = $15.00
2012-2013 Total Actual Revenues = $85.00
2014-2015 Eligible Recovery adjusted by $−5.00
2012-2013 BRP is $100.00 × .95 = $95.00 (Adjusted BPR)
2012-2013 Total Projected Revenues = $85.00
2012-2013 Eligible Recovery (Adjusted BPR-Projected Revenues) = $10.00
2012-2013 Total Actual Revenues = $80.00
2014-2015 Eligible Recovery adjusted by $5.00
7. As noted above, the 2014 annual tariff filing was the first time that Eligible Recovery was adjusted to Start Printed Page 15908incorporate a true-up of projected demand used in calculating Eligible Recovery for an earlier tariff period. The true-up process is designed to provide certainty to rate-of-return carriers by accounting for any difference between projected and actual switched access revenues, reciprocal compensation revenues, or ARC revenues due to demand variations. As the above examples and the illustration in the USF/ICC Transformation Order (which similarly shows operation of the true-up process when a carrier both overestimated and underestimated its projected revenues for the first year of the ICC reforms adopted by the Commission) demonstrate, a carrier's Eligible Recovery was to be adjusted either upward or downward based on any such differences. As the illustration in the USF/ICC Transformation Order reflects, the Commission expected that the amount of any adjustment could be completely offset through adjustments to the amount of Eligible Recovery for which ARC rates could be assessed and Connect America Fund ICC support could be received.
9. The first set of facts identified by NECA involves several carriers whose 2012-13 tariff period projected demand was underestimated compared to their ultimate actual demand. Each carrier therefore received too much Eligible Recovery in 2012-13, and, under the rules, their 2014-15 Eligible Recovery should be reduced by the amount of revenues associated with the demand difference. The carriers' Eligible Recovery for 2014-15 before reflecting the true-up adjustment, however, was not large enough to offset completely the true-up reduction from the 2012-13 tariff period. Thus, the excess Eligible Recovery carriers received during the 2012-13 tariff period has not been fully offset, and the carriers would be left with duplicative recovery in contravention of § 51.917(d)(1)(vii) of the rules absent clarification to specify the procedures to be followed under these circumstances. We accordingly clarify that carriers that are in this situation with respect to their 2014-15 Eligible Recovery calculation must refund to USAC the amount of the excess recovery that was not offset within thirty (30) days of the effective date of the Order. Consistent with the rules we adopt, as set forth in the Appendix, in the future a carrier in this situation must refund excess amounts to USAC by August 1 following the date of the annual access tariff filing.
13. The Regulatory Flexibility Act of 1980, as amended (RFA), requires that a regulatory flexibility analysis be prepared for rulemaking proceedings, unless the agency certifies that “the rule will not have a significant economic Start Printed Page 15909impact on a substantial number of small entities.” The RFA generally defines “small entity” as having the same meaning as the terms “small business,” “small organization,” and “small governmental jurisdiction.” In addition, the term “small business” has the same meaning as the term “small business concern” under the Small Business Act. A small business concern is one which: (1) Is independently owned and operated; (2) is not dominant in its field of operation; and (3) satisfies any additional criteria established by the Small Business Administration (SBA).
14. We hereby certify that the rule revisions adopted in the Order will not have a significant economic impact on a substantial number of small entities. The Order amends rules adopted in the USF/ICC Transformation Order by correcting conflicts between the new or revised rules and existing rules, as well as addressing omissions or oversights. These revisions do not create any burdens, benefits, or requirements that were not addressed by the Final Regulatory Flexibility Analysis attached to the USF/ICC Transformation Order. The Commission will send a copy of the Order, including a copy of this final certification, to the Chief Counsel for Advocacy of the SBA. In addition, the Order (or a summary thereof) and certification will be published in the Federal Register.
16. Accordingly, it is ordered, that pursuant to the authority contained in sections 1, 2, 4(i), 201-203, 220, 251, 252, 254, 303(r) and 403 of the Communications Act of 1934, as amended, 47 U.S.C. 151, 152, 154(i), 201-203, 220, 251, 252, 254, 303(r) and 403, and pursuant to §§ 0.91, 0.201(d), 0.291, 1.3, and 1.427 of the Commission's rules, 47 CFR 0.91, 0.201(d), 0.291, 1.3 and 1.427, and pursuant to the delegation of authority in paragraph 1404 of 26 FCC Rcd 17663 (2011), the Order and the rules revising part 51 of the Commission's rules are adopted, effective April 27, 2015.
(A) If a Rate-of-Return Carrier in any tariff period underestimates its projected demand for services covered by § 51.917(b)(6) or 51.915(b)(13), and thus has too much Eligible Recovery in that tariff period, it shall refund the amount of any such True-up Revenues or True-up Revenues for Access Recovery Charge that are not offset by the Rate-of-Return Carrier's Eligible Recovery (calculated before including the true-up amounts in the Eligible Recovery calculation) in the true-up tariff period to the Administrator by August 1 following the date of the Rate-of-Return Carrier's annual access tariff filing.
(B) If a Rate-of-Return Carrier in any tariff period receives too little Eligible Recovery because it overestimates its projected demand for services covered by § 51.917(b)(6) or 51.915(b)(13), which True-up Revenues and True-up Revenues for Access Recovery Charge it cannot recover in the true-up tariff period because the Rate-of-Return Carrier has a negative Eligible Recovery in the true-up tariff period (before calculating the true-up amount in the Eligible Recovery calculation), the Rate-of-Return Carrier shall treat the unrecoverable true-up amount as its Eligible Recovery for the true-up tariff period.