[Federal Register: January 17, 2008 (Volume 73, Number 12)]
[Rules and Regulations]
[Page 3197-3202]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr17ja08-7]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Part 64
[CG Docket No. 03-123; FCC 07-186]
Telecommunications Relay Services and Speech-to-Speech Services
for Individuals With Hearing and Speech Disabilities
AGENCY: Federal Communications Commission.
ACTION: Final rule.
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SUMMARY: In this document, the Commission adopts new cost recovery
methodologies regarding compensation for the provision of
Telecommunications Relay Services (TRS) from the Interstate TRS Fund
(the Fund). Those cost recovery methodologies will result in fairer,
more predictable rates that better reflect the actual costs and market
realities of providing TRS. The Commission also: adopts new per-minute
compensation rates for the various forms of TRS; clarifies the nature
of certain cost categories and extent to which they are compensable
from the Fund; reaffirms the role that the TRS Advisory Council is to
play in the oversight of TRS; and announces its intent of additional
and more comprehensive auditing of TRS providers to ensure Fund
integrity.
DATES: 47 CFR 64.604 (c)(5)(iii)(C) contains information collection
requirements that have not been approved by the Office of Management
and Budget (OMB). The Commission will publish a separate document in
the Federal Register announcing the effective date for the amendment
and information collection requirements. Interested parties (including
the general public, OMB, and other Federal agencies) that wish to
submit written comments on the PRA information collection requirements
must do so on or before March 17, 2008.
ADDRESSES: Interested parties may submit PRA comments identified by OMB
Control Number 3060-0463, by any of the following methods:
Federal eRulemaking Portal: http://www.regulations.gov.
Follow the instructions for submitting comments.
Federal Communications Commission's Web Site: http://www.fcc.gov/cgb/ecfs/.
Follow the instructions for submitting comments.
E-mail: Parties who choose to file by email should submit
their comments to PRA@fcc.gov. Please include CG Docket Number 03-123
and OMB Control Number 3060-0463 in the subject line of the message.
Mail: Parties who choose to file by paper should submit
their comments to Cathy Williams, Federal Communications Commission,
Room 1-C823, 445 12th Street, SW., Washington, DC 20554.
FOR FURTHER INFORMATION CONTACT: Thomas Chandler, Consumer and
Governmental Affairs Bureau, Disability Rights Office at (202) 418-1475
(voice), (202) 418-0597 (TTY), or e-mail at Thomas.Chandler@fcc.gov.
For additional information concerning the PRA information collection
requirements contained in this document, contact Cathy Williams at
(202) 418-2918, or via the Internet at PRA@fcc.gov.
SUPPLEMENTARY INFORMATION: This is a summary of the Commission's
Telecommunications Relay Services and Speech-to-Speech Services for
Individuals with Hearing and Speech Disabilities, Report and Order and
Declaratory Ruling (2007 TRS Cost Recovery Order), document FCC 07-186,
adopted October 26, 2007, and released November 19, 2007, in CG Docket
No. 03-123. Document FCC 07-186 addresses issues arising from the
Commission's Further Notice of Proposed Rulemaking, Telecommunications
Relay Services and Speech-to-Speech Services for Individuals with
Hearing and Speech Disabilities (2006 TRS Cost Recovery FNPRM), CG
Docket No. 03-123, FCC 06-106, published at 71 FR 54009, September 13,
2006. The full text of document FCC 07-186 and copies of any
subsequently filed documents in this matter will be available for
public inspection and copying during regular business hours at the FCC
Reference Information Center, Portals II, 445 12th Street, SW., Room
CY-A257, Washington, DC 20554. Document FCC 07-186 and copies of
subsequently filed documents in this matter also may be purchased from
the Commission's duplicating contractor at Portals II, 445 12th Street,
SW., Room CY-B402, Washington, DC 20554. Customers may contact the
Commission's duplicating contractor at its Web site http://www.bcpiweb.com
or by calling 1-800-378-3160. To request materials in
accessible formats for people with disabilities (Braille, large print,
electronic files, audio format), send an e-mail to fcc504@fcc.gov or
call the Consumer and Governmental Affairs Bureau at (202) 418-0530
(voice), (202) 418-0432 (TTY). Document FCC 07-186 can also be
downloaded in Word or Portable Document Format (PDF) at: http://www.fcc.gov/cgb/dro/trs.html
.
Paperwork Reduction Act of 1995 Analysis
Document FCC 07-186 contains modified information collection
requirements subject to the PRA of 1995. It will be submitted to OMB
for review under section 3507 of the PRA. OMB, the general public, and
other Federal agencies are invited to comment on the modified
information collection requirements contained in this proceeding.
Public and agency comments are due March 17, 2008. In addition, the
Commission notes pursuant to the Small Business Paperwork Relief Act of
2002, Public Law 107-198, see 44 U.S.C. 3506 (c)(4), that the
Commission previously sought specific comment on how it may ``further
reduce the information collection burden for small business concerns
with fewer than 25 employees.''
Synopsis
1. In the 2006 TRS Cost Recovery FNPRM, the Commission sought
comment on four issues concerning the compensation of relay providers
from the Fund. First, the Commission sought comment on the adoption of
an alternative cost recovery methodology for traditional TRS, STS
services, and IP Relay services based on the Multi-state Average Rate
Structure (MARS) plan, under which the compensation rate would be based
on a weighted average of competitively bid intrastate rates. The
Commission sought comment on
[[Page 3198]]
whether adoption of the MARS plan would result in a more efficient
provision of service and a fairer, more reasonable compensation rate,
as well as on how the MARS plan would be implemented and whether the
rates for those TRS forms should continue to be set for a one-year
period or for longer.
2. Second, the Commission sought comment on the adoption of an
alternative cost recovery methodology for VRS. The Commission
emphasized the need for a cost recovery methodology that would result
in more predictable rates that more closely approximate the reasonable
actual costs of providing VRS services. Accordingly, the Commission
sought comment on whether changes should be made to the existing cost
recovery methodology, or whether a new methodology should be adopted.
The Commission proposed various new methodologies, including
compensating each provider based on the provider's actual, reasonable
costs, seeking competitive bids, or using a ``true-up'' based on each
provider's reasonable actual costs. The Commission also sought comment
on whether the VRS compensation rate should be set for a two-year
period, rather than a one-year period.
3. Third, the Commission sought comment on the extent to which
certain types of costs--including marketing and outreach expenses,
overhead costs, legal and lobbying expenses, start-up expenses, and
executive compensation--are compensable from the Fund. Finally, the
Commission sought comment on the steps it might take to ensure the
integrity of the Fund and that compensation is paid consistent with the
statute. Specifically, the Commission sought comment on the oversight
of the Fund administrator, presently the National Exchange Carrier
Association (NECA), the oversight of the providers, and ways to deter
waste, fraud, and abuse.
4. The 2007 TRS Cost Recovery Order resolves the issues on which
the Commission sought comment in the 2006 TRS Cost Recovery FNPRM.
First, the Commission adopts the MARS plan as the cost recovery
methodology for interstate traditional TRS, interstate STS, interstate
CTS, and interstate and intrastate IP CTS. Presently, the compensation
rates are based on a weighted average of the providers' projected
minutes of use of the service, and their projected costs of providing
these minutes, for a future two-year period. Because the current
methodology is based on projections only, it does not result in rates
that satisfactorily correlate to the providers' actual costs. Adopting
the MARS plan, in contrast, will produce a rate that better
approximates actual costs, and therefore will promote the efficient
recovery of all costs. It also will eliminate the costs, burdens, and
uncertainties associated with evaluating, correcting, and re-evaluating
provider data.
5. The Commission will calculate one MARS rate applicable to both
interstate traditional TRS and interstate STS based on state rates for
intrastate TRS and STS, and adopt a separate MARS rate for interstate
CTS and IP CTS based on state rates for intrastate CTS. Regardless, for
both rates, the rate calculation mechanism will be the same. Generally,
each January, the Fund administrator will request that the following
information be filed on a per-state basis for the previous calendar
year: (1) The per-minute compensation rate(s) for intrastate
traditional TRS, intrastate STS, and intrastate CTS; (2) whether the
rate applies to session or conversation minutes; (3) the number of
session and conversation minutes for intrastate traditional TRS,
intrastate STS, and intrastate CTS, (4) other amounts paid to the
provider(s) for the relevant calendar year, if the per-minute
compensation rate does not reflect the total costs paid by the state to
the provider(s) for the relay service(s); and (5) other factors bearing
on the rate averages, such as mid-year rate changes.
6. The Fund administrator will multiply each state's respective
intrastate traditional TRS and intrastate STS, and intrastate CTS,
rates by the number of either intrastate session minutes or
conversation minutes, whichever the state rates are based upon, and
then total each state's total dollar amount for each rate. The Fund
administrator will then divide the total dollar amount(s) for all the
states (including costs not reflected in the rate) by the applicable
total of all states' intrastate conversation minutes (even if some
states do not base their rate on conversation minutes) for each service
(e.g., intrastate traditional TRS and intrastate STS in one
calculation, intrastate CTS in the other).
7. The Fund administrator will file the MARS plan rate(s), as
calculated, with the Commission by May 1st of each year, and the
proposed MARS rate for each service and an explanation of how it was
calculated will be placed on public notice. The Commission will then
release by June 30 of each year an order adopting the compensation rate
for the following July 1st to June 30th Fund year. The Commission will
monitor the implementation of the MARS plan and, if necessary, take
further steps to ensure that the MARS rate compensates providers for
their reasonable costs of providing service.
8. Beginning March 1, 2008, and for the remainder of the 2007-08
Fund year, the MARS plan per-minute rate of $1.592 shall apply for
interstate traditional TRS and interstate STS. This rate is a result of
the calendar 2006 intrastate TRS and STS data filed by 49 states and
Puerto Rico, which show that a total of $100,738,030 was spent to pay
for 63,275,205 conversation minutes, which translates to $1.592 per
minute.
9. The Commission believes that this rate is reasonable because it
is based on competitively bid state rates. For interstate STS, however,
the Commission will add an additional $1.131 per minute, resulting in a
total of $2.723, because of concerns that outreach efforts toward the
STS community have not been effective. Each STS provider must allocate
this additional $1.131 per minute toward outreach efforts directed at
the STS community. For interstate CTS and interstate and intrastate IP
CTS, the Commission adopts a 2007-2008 compensation rate of $1.629 per
minute. This rate is based on calendar 2006 intrastate captioned
telephone service data from the 39 states that provided this service in
2006, which shows that $15,867,338, was spent to pay for 9,739,138
conversation minutes, which translates to $1.629 per minute.
10. Second, for IP Relay, the Commission declines to adopt a cost
recovery methodology based on the MARS plan because there are no state
rates for this service. Instead, the Commission adopts a cost recovery
methodology based on price caps. As a general matter, the price cap
plan adjusts a base rate upward for inflation and other, additional
costs not reflected in the inflation adjustment, then downward for
improved efficiencies. In so doing, the price cap plan applies three
factors--an Inflation Factor, an Efficiency (or ``X'') Factor, and
Exogenous Costs--to a base rate. The Inflation Factor will be the Gross
Domestic Product--Price Index (GDP-PI)). The Efficiency Factor will be
set as a figure equal to the Inflation Factor, less 0.5 percent (or
0.005) to account for productivity gains.
11. The Exogenous Costs will be those costs beyond the control of
the IP Relay providers that are not reflected in the inflation
adjustment, such as additional costs that they incur to satisfy new,
Commission-adopted service requirements. As a result of the basic price
cap plan formula, which multiplies the base rate by a factor that
reflects an increase due to inflation, and then offsets it by a
decrease due to
[[Page 3199]]
efficiencies, the rate for a particular year generally will equal the
rate for the previous year, reduced by 0.5 percent (i.e.,
RateYear Y = RateYear Y-1 (1-0.005)).
Adopting this methodology for IP Relay will encourage IP Relay
providers to become more efficient in providing the service.
12. The Commission adopts the price cap plan for three years, with
the first rate period being the 2007-2008 Fund year. The rates will
then continue, with annual adjustments for productivity gains, through
the 2009-2010 Fund Year. The Commission will then assess what the base
rate should be for the following three year period.
13. Beginning March 1, 2008, the per-minute rate of $1.293 shall
apply for inter- and intrastate IP Relay. NECA presented IP Relay rates
ranging between $1.16 and $1.28, the latter reflecting both 2006 actual
costs adjusted for inflation and a rate based on providers' projected
minutes of use and costs, unadjusted. The Commission believes that the
current rate reasonably compensates providers based on the cost data
and the rates proposed by NECA, and that adopting the base rate for a
three year period will add additional stability and predictability to
the IP Relay rates. This rate shall continue through the 2009-2010 Fund
year, subject to annual adjustment under the price cap plan.
14. Third, for VRS, the Commission adopts a tiered-rate cost
recovery methodology which compensates VRS providers at different per-
minute rates for monthly call minutes that fall within predetermined
total call volume ranges. The VRS rates will be based on the providers'
projected costs and minutes of use, and other data the VRS providers
submit to the Fund administrator, subject to appropriate review and,
where necessary, disallowances. Specifically, this tiered-rate approach
is intended to reflect likely cost differentials between small
providers (including new entrants); mid-level providers who are
established but who do not hold a dominant market share; and large,
dominant providers who are in the best position to achieve cost
synergies.
15. This tiered-rate approach will allow providers that handle a
relatively small amount of minutes and therefore have relatively higher
per-minute costs to receive compensation on a monthly basis more likely
to accurately correlate to their actual costs. Conversely, providers
that handle a larger number of minutes, and therefore have lower per-
minute costs, will also receive compensation on a monthly basis more
likely to accurately correlate to their actual costs. Furthermore,
under the tiered approach, all providers would be compensated on a
``cascading'' basis, such that providers would be compensated at the
same rate for the minutes falling within a specific tier. In other
words, all providers will be compensated at the highest rate for those
minutes falling within the first tier; at the middle rate for those
minutes falling within the middle tier, and at the lower rate for all
additional minutes.
16. The Commission will set the tiers and their corresponding per-
minute rates for a three-year period, and will reduce the rates
annually by 0.5 percent while allowing providers to seek exogenous cost
adjustments for new costs imposed that are beyond the providers'
control. The 0.5 percent annual downward adjustment will reduce Fund
expenditures and encourage VRS providers to gain efficiencies in
providing VRS services. The Commission believes that these tiers are
appropriate to promote competition, and ensure that the newer providers
are compensated for their actual costs and that the larger, more
established providers are not overcompensated.
17. Beginning March 1, 2008, the three following call volume tiers
and their corresponding per-minute rates shall apply for VRS: For the
first 50,000 monthly minutes, $6.77; for monthly minutes between 50,001
and 500,000, $6.50; and for monthly minutes exceeding 500,000, $6.30.
Those tiers, the number and size of which will be reevaluated every
three years, are based on the data regarding total monthly VRS minutes
that the various providers have submitted to NECA. That data indicates,
first, that the newer providers generally provide less than 50,000
minutes per month. For those providers offering a relatively small
number of minutes, it is appropriate to base the rate on the providers'
projected costs and minutes of use. As NECA's filing data reflects, the
rate based on the providers' projected demand and cost data, without
any disallowances, is $6.77.
18. The Commission believes that this rate fairly reflects the
actual reasonable costs of the newer or smaller providers offering VRS
in compliance with all non-waived mandatory minimum standards. Second,
the NECA filing data indicates that more established providers provide
monthly minutes ranging in the low hundreds of thousands. For those
established but non-dominant providers, the Commission believes it is
appropriate to base the rate on the $6.77 rate noted above, less
marketing and certain undisputed cost disallowances. The resulting rate
is $6.50. Finally, the NECA filing data shows that the dominant
provider provides minutes ranging in the millions. Such call volumes
lead to economies of scale that result in lower per-minute costs.
Accordingly, the Commission adopts a rate of $6.30 for this third and
final tier. This rate will encourage providers with large numbers of
minutes to become more efficient.
19. Fourth, in addition to adopting new cost recovery methodologies
and compensation rates, the Commission clarifies the extent to which
certain cost categories are compensable from the Fund. Specifically,
the Commission concludes that indirect overhead costs are not
reasonable costs of providing TRS; accordingly, to be compensable,
overhead costs must be directly related to, and directly support, the
provision of relay service. The Commission also concludes that, to
encourage competition in the VRS market, entry costs or start-up
expenses of new entities seeking to provide VRS are compensable, but
must be amortized in accordance with generally accepted accounting
principles so that they are recovered over time and will not skew the
rate in a particular year. Also, executive compensation is compensable
to the extent that it is reasonable and is for services that ``directly
support the provision of TRS.'' In determining what constitutes
reasonable compensation, the Commission will consider bonuses, stock
options, and other forms of compensation.
20. With respect to other, miscellaneous costs, financial
transaction costs or fees unrelated to the provision of relay service,
such as those relating to the sale or change in ownership or structure
of a relay service entity, are not compensable expenses. Also, costs
attributable to consumer premises equipment such as relay hardware and
software used by the consumer, including installation, maintenance
costs, and testing, are not compensable. The Commission will scrutinize
the providers' submitted costs to ensure that such consumer premises
equipment costs are not directly or indirectly included.
21. Finally, with respect to management and oversight of the Fund,
the Commission reaffirms the role that the TRS Advisory Council may
play in the oversight of TRS--including in the development of new cost
recovery guidelines and compensation rate proposals, and further
addressing of the compensability of certain cost categories--and
expresses that the Council also can address other matters as assigned
by the Commission. In
[[Page 3200]]
addition, the Commission announces its intention of additional and more
comprehensive auditing of TRS providers to ensure Fund integrity, by,
for example, reviewing the underlying documentation supporting
submitted cost and demand data, as well as minutes submitted for
compensation.
22. The Commission also concludes that there should be more
transparency to the rate setting process. The Commission realizes,
however, that the interest in transparency must be balanced against the
providers' interest in the confidentiality of their cost and demand
data, an interest reflected in the Commission's rules. The Commission
believes the MARS plan will make more transparent the determination of
the traditional TRS, STS, CTS, and IP CTS rates. Not only does the
Commission anticipate listing the State rates used in calculating the
MARS rates and setting forth the final calculation that divides total
costs by total minutes to determine the rate, but there are no cost
adjustments to provider specific data in the determination of these
rates, which furthers the goal of transparency.
23. In the Declaratory Ruling portion of the 2007 TRS Cost Recovery
Order, the Commission reiterates its prior rulings that a TRS provider
may not offer any direct or indirect, financial or other tangible,
incentive to a TRS user or third party to encourage TRS users to make
TRS calls that they would not otherwise make, including calls designed
to elicit customer feedback on quality of service. Nor may a relay
provider condition a user's ongoing use or possession of relay
equipment, or the receipt of different or upgraded equipment, on the
user making relay calls through its service or the service of any other
provider. In other words, providers cannot give consumers equipment as
part of outreach efforts or for other purposes, and then require that
the equipment be relinquished if the consumer fails to maintain a
certain call volume. Not only do such practices likely require the
impermissible use of the providers' call database, and the
impermissible monitoring of consumers' calls, they also constitute
impermissible financial incentives.
24. In addition, relay providers may not use a consumer or call
database to contact relay users for lobbying or any other purpose. The
Commission has made clear that TRS customer profile information cannot
be used for any purpose other than handling relay calls. Therefore, for
example, a provider may not contact its customers, by an automated
message, postcards, or otherwise, to inform them about pending TRS
compensation issues and urge them to contact the Commission about the
compensation rates. Similarly, a provider may not use call data to
monitor the TRS use by its customers (or the customers of other
providers) and to determine whether they are making a sufficient number
of calls to warrant further benefits from the provider.
Final Regulatory Flexibility Certification
25. 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, if promulgated, have a significant economic impact on a
substantial number of small entities.'' 5 U.S.C. 605(b). The RFA
generally defines ``small entity'' as having the same meaning as the
terms ``small business,'' ``small organization,'' and ``small
governmental jurisdiction.'' 5 U.S.C. 601(6). In addition, the term
``small business'' has the same meaning as the term ``small business
concern'' under the Small Business Act. 5 U.S.C. 601(3). 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). Small Business Act, 15 U.S.C. 632.
26. The 2007 TRS Cost Recovery Order addresses issues related to
cost recovery methodologies for various forms of TRS. The 2007 TRS Cost
Recovery Order adopts a single cost recovery methodology based on the
``MARS'' plan for interstate traditional TRS, interstate STS,
interstate CTS, and interstate and intrastate IP CTS. Beginning with
the 2007-2008 Fund year, a single MARS rate will be calculated and will
apply to interstate traditional TRS and interstate STS, interstate CTS,
and IP CTS. Because states generally negotiate and pay separate rates
for captioned telephone service, a separate MARS rate will be
calculated and will apply to interstate captioned telephone service.
27. The Commission concludes that the MARS methodology, as
proposed, cannot be applied to IP Relay because there are no state
rates for these services. The Commission, therefore, continues to use a
cost recovery methodology for IP Relay based on the providers'
projected demand and cost data that reasonably compensates the
providers for the provision of IP Relay service. The Commission also
concludes that adopting the proposed price cap plan for IP Relay will
encourage IP Relay providers to become more efficient in providing the
service. The Commission believes that the price cap plan for IP Relay
will not have a significant economic impact on a substantial number of
small businesses.
28. The Commission concludes that adoption of the MARS plan for
Interstate Traditional TRS, Interstate STS, Interstate CTS, and IP CTS
for setting the rate eliminates the need to file the much more
voluminous cost and demand data that providers presently must submit
under the current cost recovery methodology to the Fund administrator.
The Commission, therefore, concludes that the effect of the adoption of
the MARS plan would be to lessen the reporting burden on small
businesses. Accordingly, the Commission does not believe that these
actions will have a significant economic impact on a substantial number
of small businesses.
29. The Commission further believes that the decision to set a
standard for how ``reasonable'' costs should be compensable under the
present cost recovery methodology for all forms of TRS, as well as a
standard for what ``reasonable'' costs should include, will provide
guidance for the providers, and therefore, benefits small businesses in
two ways. This includes setting a standard for whether, and to what
extent, marketing and outreach expenses, overhead costs, and executive
compensation are compensable from the Fund. First, it provides
predictability, and secondly, it eliminates uncertainties with whether
the costs submitted would be compensable or not. Eliminating
uncertainties will lessen the reporting burden on small businesses. The
Commission therefore concludes that the requirements of the 2007 TRS
Cost Recovery Order will not have a significant economic impact on a
substantial number of small entities.
30. The Commission expressed concern, based on comparisons of VRS
providers' cost and demand projections with their actual historical
data, that some VRS providers have received compensation significantly
in excess of their actual costs. The Commission has also observed that
providers' demand forecasts for VRS generally have been lower than
actual demand, resulting in overcompensation to providers for completed
minutes under the current per-minute cost recovery scheme.
31. The Commission, therefore, adopts three compensation rate tiers
for VRS. These tiers are intended to reflect likely cost differentials
between small providers; mid-level providers who are established but
who do not hold a dominant market share; and large, dominant providers
who are in the best
[[Page 3201]]
position to achieve cost synergies. As a general matter, the three-
tiered approach is based on market data reflecting the number of
monthly minutes submitted to NECA by the various providers. The data
reflects that the newer providers generally provide less than 100,000
minutes per month; that other, more established providers (with the
exception of the dominant provider) generally provide monthly minutes
ranging in the low hundreds of thousands; and that the dominant
provider provides minutes ranging in the millions. The Commission,
therefore, believes that using three tiers is appropriate to ensure
both that, in furtherance of promoting competition, the newer providers
will cover their costs, and the larger and more established providers
are not overcompensated due to economies of scale.
32. By adopting a tiered approach, providers that handle a
relatively small number of minutes and therefore have relatively higher
per-minute costs will receive compensation on a monthly basis that will
likely more accurately correlate to their actual costs. Conversely,
providers that handle a larger number of minutes, and that therefore
have lower per-minute costs, will also receive compensation on a
monthly basis that likely more accurately correlates to their actual
costs. Furthermore, the Commission concludes that under such a tiered
approach, all providers will be compensated on a ``cascading'' basis,
such that providers will be compensated at the same rate for the
minutes falling within a specific tier. In other words, all providers
will be compensated at the highest rate for those minutes falling
within the first tier; at the middle rate for those minutes falling
within the middle tier, and at the lower rate for all additional
minutes. The Commission believes that using tiered rates, rather than a
single, weighted average rate, will more fairly compensate all
providers for their reasonable actual costs of providing service. Since
fair compensation will benefit all providers equally, imposing no
separate and adverse impact on smaller entities, the Commission further
concludes that its tiered rates will not have a significant economic
impact on a substantial number of small entities.
33. Because the Commission recognizes that potential STS users are
not being made aware of the availability of STS, the Commission adds an
additional amount to the STS compensation rate for outreach efforts.
The Commission also requires that STS providers file a report annually
with NECA and the Commission on their specific outreach efforts
directly attributable to the additional support for STS outreach. Since
STS providers will be compensated an additional amount for outreach,
the Commission concludes that requiring STS providers to file an annual
report will not have a significant economic impact on a substantial
number of small entities.
34. Finally, in order to be compensated for the costs of providing
TRS, the providers are required to meet the applicable TRS mandatory
minimum standards as required in 47 CFR 64.604. See generally 47 CFR
64.604(c)(5)(iii)(E). Reasonable costs of compliance with the 2007 TRS
Cost Recovery Order are compensable from the Fund. Thus, because the
providers will recoup the costs of compliance within a reasonable
period, the Commission asserts that the providers will not be
detrimentally burdened. Therefore, the Commission certifies that the
requirements of the 2007 TRS Cost Recovery Order will not have a
significant economic impact on a substantial number of small entities.
35. The Commission also notes that, with specific regard to the
issue of whether a substantial number of small entities will be
affected, of the 13 providers affected by the ruling adopted herein,
there are only three small entities that will be affected by the
Commission's action. The SBA has developed a small business size
standard for Wired Telecommunications Carriers, which consists of all
such firms having 1,500 or fewer employees. 13 CFR 121.201, NAICS code
517110. Currently, thirteen providers are providing various forms of
TRS and being compensated from the Interstate TRS Fund: Ameritech; AT&T
Corp.; CapTel, Inc.; Communication Access Center for the Deaf and Hard
of Hearing, Inc.; GoAmerica; Hamilton Relay, Inc.; Hands On; Healinc;
Nordia Inc.; Snap Telecommunications, Inc.; Sorenson; Sprint and
Verizon. The Commission notes that 3 of 13 providers noted above are
small entities under the SBA's small business size standard. Because
three of the affected providers will be promptly compensated within a
reasonable period for complying with the 2007 TRS Cost Recovery Order,
the Commission concludes that the number of small entities affected by
the Commission's decision in the 2007 TRS Cost Recovery Order is not
substantial.
36. Therefore, for all of the reasons stated above, the Commission
certifies that the requirements of the 2007 TRS Cost Recovery Order
will not have a significant economic impact on these small entities.
37. The Commission will send a copy of the 2007 TRS Cost Recovery
Order, including a copy of this Final Regulatory Flexibility
Certification, in a report to Congress pursuant to the Congressional
Review Act, see 5 U.S.C. 801(a)(1)(A). In addition, the 2007 TRS Cost
Recovery Order and this final certification will be sent to the Chief
Counsel for Advocacy of the SBA.
Congressional Review Act
The Commission will send a copy of the 2007 TRS Cost Recovery Order
in a report to be sent to Congress and the Government Accountability
Office pursuant to the Congressional Review Act, see 5 U.S.C.
801(a)(1)(A).
Ordering Clauses
Pursuant to Sections 1, 2, and 225 of the Communications Act of
1934, as amended, 47 U.S.C. 151, 152, and 225, the 2007 TRS Cost
Recovery Order IS ADOPTED.
An annual compensation rate shall apply to interstate traditional
TRS and interstate STS based on the MARS plan and the intrastate
traditional TRS and STS rate(s) paid by the states, as provided in the
2007 TRS Cost Recovery Order.
An annual compensation rate shall apply to interstate CTS and
interstate and intrastate IP CTS based on the MARS plan and the
intrastate CTS rate paid by the states, as provided in the 2007 TRS
Cost Recovery Order.
A compensation rate shall apply to interstate and intrastate IP
Relay based on price caps, and the rate shall be set for three-year
periods, subject to adjustment, beginning with the 2007-2008 Fund year,
as provided in the 2007 TRS Cost Recovery Order.
Tiered compensation rates shall apply to interstate and intrastate
VRS based on minutes of use, and the rates shall be set for three-year
periods, subject to adjustment, beginning with the 2007-2008 Fund year,
as provided in the 2007 TRS Cost Recovery Order.
Effective March 1, 2008, the following per-minute compensation
rates shall apply, as provided herein: for interstate traditional TRS:
$1.592; for interstate STS: $2.723; for interstate CTS and interstate
and intrastate IP CTS: $1.629; for interstate and intrastate IP Relay:
$1.293; and for interstate and intrastate VRS: (1) For the first 50,000
monthly minutes: $6.77; (2) for monthly minutes between 50,001 and
500,000: $6.50; and (3) for monthly minutes above 500,000: $6.30.
The amendment to section 64.604 of the Commission's rules is
adopted.
The 2007 TRS Cost Recovery Order shall be effective February 19,
2008,
[[Page 3202]]
except Sec. 64.604 (c)(5)(iii)(C) of the Commission's rules, which
contains information collection requirements that are not effective
until approved by OMB. The Commission will publish a separate document
in the Federal Register announcing the effective date of the rule.
The Commission's Consumer and Governmental Affairs Bureau,
Reference Information Center, shall send a copy of the 2007 TRS Cost
Recovery Order, including the Final Regulatory Flexibility
Certification, to the Chief Counsel for Advocacy of the Small Business
Administration.
List of Subjects in 47 CFR Part 64
Individuals with disabilities, Reporting and recordkeeping
requirements, Telecommunications.
Federal Communications Commission.
Marlene H. Dortch,
Secretary.
Rule Changes
0
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
0
1. The authority citation for part 64 continues to read as follows:
Authority: 47 U.S.C. 154, 254 (k); secs. 403 (b)(2)(B), (c),
Public Law 104-104, 110 Stat. 56.
Interpret or apply 47 U.S.C. 201, 218, 222, 225, 226, 228, and
254(k) unless otherwise noted.
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2. Section 64.604 is amended by revising paragraph (c)(5)(iii)(C) to
read as follows:
Sec. 64.604 Mandatory minimum standards.
* * * * *
(c) * * *
(5) * * *
(iii) * * *
(C) Data collection from TRS providers. TRS providers shall provide
the administrator with true and adequate data, and other historical,
projected and state rate related information reasonably requested by
the administrator, necessary to determine 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 operating expenses and total TRS investment in general
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. The
administrator and the Commission shall have the authority to examine,
verify and audit data received from TRS providers as necessary to
assure the accuracy and integrity of TRS Fund payments.
* * * * *
[FR Doc. E8-759 Filed 1-16-08; 8:45 am]
BILLING CODE 6712-01-P