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Start Preamble June 19, 2001.

The Federal Communications Commission (FCC) has received Office of Management and Budget (OMB) approval for the following public information collections pursuant to the Paperwork Reduction Act of 1995, Public Law 104-13. An agency may not conduct or sponsor and a person is not required to respond to a collection of information unless it displays a currently valid control number. For further information contact Shoko B. Hair, Federal Communications Commission, (202) 418-1379.

Federal Communications Commission

OMB Control No.: 3060-0986.

Expiration Date: 12/31/2001.

Title: Federal State Joint Board on Universal Service Plan for Reforming the Rural Universal Support Mechanism, CC Docket No. 96-45.

Form No.: N/A.

Respondents: Business or other for-profit; State, Local or Tribal Government.

Estimated Annual Burden: 7099 respondents; .81 hours per response (avg.); 5770 total annual burden hours (for all collections approved under this control number).

Estimated Annual Reporting and Recordkeeping Cost Burden: $0.

Frequency of Response: On occasion; Quarterly; Annually; One-time Requirement; Third Party Disclosure.

Description: In the Fourteenth Report and Order, Twenty-Second Order on Reconsideration in CC Docket No. 96-45 and Report and Order in CC Docket No. 00-256, released May 23, 201 (FCC 01-157), consistent with the recommendation of the Federal-State Joint Board on Universal Service (Joint Board), the Commission adopts rules for determining high-cost universal service support for rural telephone companies for the next five years based upon the proposals made by the Rural Task Force. The Commission also addresses certain proposals made by the Multi-Association Group (MAG) for reforming universal services rules applicable to rural carriers. As part of its proposal to reform the federal universal service support mechanism for rural carriers, the Rural Task Force proposed that rural carriers be permitted to depart from study area averaging and instead disaggregate and target per-line high-cost universal service support, including high-cost loop support, LTS, and LSS, into geographic areas below the study area level. The Rural Task Force concluded that the disaggregation and targeting of support is necessary to eliminate the economic distortions that may result from the delivery of support on a uniform per-line basis under the current mechanism. At the same time, however, the Rural Task Force stated that rural carriers need flexibility in the manner in which support is disaggregated and targeted in light of the widely varying characteristics and operating environments of rural carriers. Recognizing that a disaggregation and targeting system must meet the unique regulatory and competitive environments in each state, the Rural Task Force recommended a disaggregation system consisting of three paths. a. Election of Disaggregation Plan and Change in Path: Carriers are required to elect one of three paths within 270 days of the effective date of the Order implementing rural high-cost Start Printed Page 34446reform through a submission to the state commission. Rural carriers not subject to the jurisdiction of the state are required to make such submission to the Commission. Carriers failing to do who will not be permitted to disaggregate and target support unless ordered to do so by a state commission or other appropriate regulatory authority either on its own motion or in response to a request by an interested party. See 47 CFR 54.315(a). (Number of respondents: 1300; hours per response: .5 hours; total annual burden: 650 hours). b. Notification of Disaggregation Methodology: 1. Path One: Carriers Not Disaggregating and Targeting High-Cost Support. Path One provides that a carrier may choose not to disaggregate. This Path is intended to address those instances where a carrier determines that given the demographics, cost characteristics, and location of its service territory, and the lack of a realistic prospect of competition, that disaggregation is not economically rational. A carrier must certify to the state commission, or other appropriate regulatory authority, that it does not want to disaggregate support. Carriers electing Path One must submit to USAC a copy of the certification of the state commission or appropriate regulatory authority certifying that it will not disaggregate and target support. See 47 CFR 54.315(b). (No. of respondents: 500; hours per response: .5 hours; total annual burden: 250 hours).2. Path 2: Carriers Seeking Prior Regulatory Approval for the Disaggregation and Targeting of Support. Path Two provides that a carrier may seek approval of its disaggregation and targeting plan from the appropriate regulatory authority. Because there are no constraints on disaggregation and targeting proposals under this path, for example a carrier could disaggregate and target support to multiple levels below a wire center, a disaggregation and targeting method can be tailored with precision, subject to state approval, to the cost and geographic characteristics of the carrier and the competitive and regulatory environment in which it operates. A carrier that chooses this path would file a disaggregation plan with the state commission, or other appropriate regulatory authority. Carriers selecting Path 2 must submit a copy to USAC of the Order approving the disaggregation plan submitted by the carriers to the state commission or appropriate regulatory authority and a copy of the disaggregation plan approved by the state commission or appropriate regulatory authority. See 47 CFR 54.315(c), (e), and (f). (No. of respondents: 873; hours per response: .666 hours; total annual burden: 582 hours). 3. Path 3. Self-Certification of the Disaggregation and Targeting of Support: The Commission adopts the Path Three self-certification process that permits carriers to choose (1) a disaggregation plan of up to two cost zones per wire center, or (2) a disaggregation plan that complies with a prior regulatory determination. A carrier must provide, among other things, the state and USAC with a description of the rationale used to disaggregate support, including the methods and data and a discussion of how the plan complies with the self-certification guidelines. In addition, if the plan uses a benchmark, it must be generally consistent with how the total study area level of support for each category of costs (high-cost loop support, LSS and LTS) is derived, to enable a competitor to compare the disaggregated costs used to determine support for each zone. See 47 CFR 54.315(d), (e) and (f). (No. of respondents: 873; hours per response: .666 hours; total annual burden: 582 hours). c. Reporting Working Loops at Cost-Zone Level: Rural carriers that elect to disaggregate and target per-line support under either Path Two or Three are required to report loops at the cost-zone level. If there is no competition in the service area the carrier is required to file annually. If competition exists in the service are than the carrier is required to file quarterly. See 47 CFR 54.307(b) and (c). (No. of respondents: 864 filing annually; 9 filing quarterly; hours per response: 2 hours; total annual burden: 1746 hours). d. State Certification Letter Under 254(e):

The Commission also concludes that states should be required to file annual certifications with the Commission to ensure that carriers use universal service support “only for the provision, maintenance and upgrading of facilities and services for which the support is intended” consistent with section 254(e). The Commission concludes that the mandate in section 254(e) applies to all carriers, rural and non-rural, that are designated as eligible to receive support under section 214(e) of the Act. States that wish to receive federal universal service high-cost support for rural carriers within their boundaries to file a certification with the Commission and USAC stating that all federal high-cost funds flowing to rural carriers in that state will be used in a manner consistent with section 254(e). The Commission recognizes that some state commissions may have only limited regulatory oversight to ensure that federal support is reflected in intrastate rates. In the case of non-rural carriers, the Commission concluded that states nonetheless may certify to the Commission that a non-rural carrier in the state had accounted to the state commission for its receipt of federal support, and that such support will be used “only for the provision, maintenance and upgrading of facilities and services for which the support is intended.” The Commission determined that, in states in which the state commission has limited jurisdiction over such carriers, the state need not initiate the certification process itself. Instead, non-rural local exchange carriers, and competitive eligible telecommunications carriers serving lines in the service area of the non-rural local exchange carriers, may formulate plans to ensure compliance with section 254(e), and present those plans to the state, so that the state may make the appropriate certification to the Commission. Absent the filing of such certification, carriers will not receive support. See 47 CFR 54.313(b) and 54.314. (No. of respondents: 60 respondents; hours per response: 3 hours; total annual burden: 180 hours). e. Support in Competitive Study Areas: Under our existing rules, rural carriers and their competitors currently are required to file line count data annually, and may file quarterly updates on a voluntary basis. Quarterly updates are required in non-rural carrier study areas. Under the current rules, if an incumbent rural carrier does not update its line count data but its competitor does, the competitor's more recent data may include lines captured from the incumbent since the incumbent's last filing. Thus the incumbent may continue to receive support for the year based on an overstated number of lines. To prevent an overpayment of support, the Commission requires the filing of line count data on a regular quarterly basis upon competitive entry in rural carrier study areas. The Commission emphasizes that this requirement will not apply in rural carrier study areas in which an eligible telecommunications carrier has not been designated. See 47 CFR 36.611 and 36.612. To ensure that the interval between the submission of data and receipt of support is as short as possible in rural carrier study areas, the Commission clarifies that competitive eligible telecommunications carriers may submit initial line count data and receive support on a regular quarterly basis under section 54.307(c). Rural telephone companies that incorporate Start Printed Page 34447acquired exchanges into existing study areas should exclude the costs associated with the acquired exchanges from the cost associated with the pre-acquisition study areas in annual universal service data a submissions used to determine eligibility for high-cost loop supports. Acquiring rural carriers shall separately provide the information listed in section 47 CFR 36.611 for both acquired and existing exchanges, as if these two categories of exchanges constitute separate study areas. See 47 CFR section 36.611. (No. of respondents: 20; hours per response: 24 hours; total annual burden: 480 hours). f. Safety Net Additive: Safety net additive support would only be available in years in which support levels would otherwise exceed the new indexed cap on the high-cost loop support fund. To receive such support in a particular study area, a carrier would need to show that growth in telecommunications plant in service (TPIS) per line is at least 14 percent greater than the study area's TPIS per line in the prior year, or the “base year.” Any study area that initially qualifies for safety net additive support would also qualify for such support in each of the four succeeding years if the cap is again triggered, regardless of whether the study area meets the 14 percent criterion in the succeeding years. Carriers must provide written notice to the Commission and USAC in conjunction with their annual or quarterly submissions to NECA indicating that a study area meets the 14 percent TPIS trigger. If a carrier should fail to provide written notification to the Commission and USAC, the study area that otherwise would have qualified for safety net additive will not be eligible. See 47 CFR 36.605(c)(2). (No. of respondents: 1300; hours per response: .5 hours; total annual burden: 650 hours). g. Safety Valve: Once relevant regulatory approvals are obtained and the transaction is closed, the rural carrier shall provide written notice to USAC that they have acquired access lines that may become eligible for safety value support. In order to assist USAC in the administration of the safety valve mechanism, rural carriers shall also provide written notice to USAC of when their index year has been established for purposes of calculating eligibility for safety valve support. See 47 CFR 54.305 (f). (No. of respondents: 1300; hours per response: .5 hours; total annual burden: 650 hours). The Commission will use the information requirements to determine whether and to what extent rural telecommunications carriers providing the data are eligible to receive universal service support. Obligation to respond: Required to obtain or retain benefits.

Public reporting burden for the collection of information is as noted above. Send comments regarding the burden estimate or any other aspect of the collections of information, including suggestions for reducing the burden to Performance Evaluation and Records Management, Washington, DC 20554.

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Federal Communications Commission.

Magalie Roman Salas,


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[FR Doc. 01-16241 Filed 6-27-01; 8:45 am]