Common Carrier Bureau Seeks Comment on Universal Service Support Distribution Options for Schools, Libraries, and Rural Health Care Providers

FEDERAL COMMUNICATIONS COMMISSION

[CC Docket 96-45; DA 97-1957]

Common Carrier Bureau Seeks Comment on Universal Service Support

Distribution Options for Schools, Libraries, and Rural Health Care

Providers

Released: September 10, 1997.

Potential for Exhaustion of Funds

On May 8, 1997, the Federal Communications Commission (Commission)

released a Report and Order on Universal Service CC Docket No. 96-45,

FCC 97-157 62 FR 32862 (June 17, 1997) (Order). 1 In the

Order, the Commission determined that funds for eligible schools,

libraries, and rural health care providers will be distributed on a

first-come first-served basis beginning January 1, 1998. The Commission

also established a $2.25 billion annual cap on universal service

support for schools and libraries and a $400 million annual cap for

rural health care providers. Eligible schools and libraries will be

required to participate in a competitive bidding process to select

their service providers and will be permitted to submit funding

requests once they have made agreements for specific eligible services.

The Administrator will commit funds based on those agreements on a

first-come first-served basis until only $250 million in funds remains

available. Thereafter, a system of priorities will govern the

distribution of the remaining $250 million to provide an opportunity

for only the most economically disadvantaged schools and libraries to

receive support. In light of the need to implement the necessary

administrative processes, funding for the period beginning January 1,

1998 and ending June 30, 1998 will be limited to $1 billion for schools

and libraries. Similarly, disbursement to rural health care providers

will be limited to $100 million in the first quarter of 1998.

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\1\ Federal-State Joint Board on Universal Service, Report and

Order, CC Docket No. 96-45, FCC 97-157 (released May 8, 1997) 62 FR

32862 (June 17, 1997).

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In response to concerns expressed about distributing support to

schools, libraries, and rural health care providers on a first-come,

first-serve basis, we seek comment on the following issues:

(1) Whether a ``window'' period should be established in which all

beneficiaries filing within that period would be given equal priority.

We seek comment on the length of the period in which any such window

should remain open and as to whether there should be a ``rolling'' or

ongoing series of windows, e.g., a series of two-week windows during

which all beneficiaries filing within that two-week period would be

given equal priority.

(2) Whether to clarify that the rules of priority for distributing

funds to schools and libraries set forth in Sec. 54.507 of the

Commission's rules, 47 CFR 54.507, apply to the $1 billion available

between January 1, 1998 through June 30, 1998. That is, if expenditures

between January 1, 1998 and June 30, 1998 reach the level where only

$250 million remains before the $1 billion cap is reached, the

remaining funds will be distributed in accordance with the rules of

priority. 2

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\2\ Although the text of the Order discusses the trigger

mechanism only with respect to the full $2.25 billion cap per

funding year, we note that Sec. 54.507(g) of the Commission's rules

states that the trigger mechanism applies when only $250 million

remains in any funding year, which includes the period from January

1, 1998 through June 30, 1998.

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(3) We also seek comment on whether a mechanism to prioritize

requests from rural health care providers should be adopted in the

event that requests exceed available funds. For example, should a

mechanism be established to ensure that funds are distributed to rural

health care providers located in all regions of the country? We seek

comment on whether such a mechanism should be permanent or should apply

only in the first quarter of 1998, when collection for rural health

care is limited to $100 million.

(4) We also seek comment on whether other methods might ensure a

broad and fair distribution of funds, particularly at the earliest

stages of these support programs.

Allocation of Aggregated Requests for Funds

In the Order, the Commission held that schools and libraries may

apply for funds on an individual basis, by school district, by state,

or by consortium. In the event that a school district or a state

applies for support on behalf of its schools, the school district or

state may compute the discounts on an individual school basis or may

compute an average discount. The state or school district shall strive

to ensure that each school receives the full benefit of the discount to

which it is entitled. On July 31, 1997, the ``E-Rate Implementation

Working Group,'' comprised of the U.S. Department of Education,

Institute of Museum and Library Services, National Telecommunications

and Information Administration, Rural Utilities Service, and Education

and Library Network Coalition, filed a report with the Commission in CC

Docket 96-45 in response to the Commission's request for

recommendations on certain issues regarding universal service support

for schools and libraries. 3 The Working Group Report

proposes a method for allocating support to individual institutions

that apply for funds on an aggregated (e.g., statewide or districtwide)

basis. We seek comment on that proposal. Copies of the report

[[Page 48281]]

are available for review and copying at the FCC Reference Center, Room

239, 1919 M Street, N.W., Washington, D.C. 20554 or on the Internet at

www.ed.gov/Technology.

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\3\ U.S. Department of Education, Institute of Museum and

Library Services, National Telecommunications and Information

Administration, Rural Utilities Service, Education and Library

Networks, Report by the E-Rate Implementation Working Group (July

31, 1997) (Working Group Report).

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Procedure for Filing

Comments should be filed in CC Docket No. 96-45 on or before

September 25, 1997, and should include the DA number shown on this

Public Notice. Pursuant to Sec. 1.3 of the Commission's rules, 47 CFR

1.3, we find good cause to waive Sec. 1.415 (c) of the Commission's

rules, 47 CFR 1.415, providing for replies to original comments.

Dispensing with reply comments is crucial due to the urgent need to

provide definitive guidance to the schools, libraries, and rural health

care providers that are applying for services supported by the

universal service support mechanisms currently scheduled to begin by

January 1, 1998. Interested parties must file an original and four

copies of their comments with the Office of Secretary, Federal

Communications Commission, Room 222, 1919 M Street, N.W., Washington,

D.C. 20554. Parties should send eight copies of their comments to

Sheryl Todd, Universal Service Branch, Accounts and Audits Division,

Federal Communications Commission, 2100 M St, N.W., 8th Floor,

Washington, D.C. 20554. Parties should send one copy of their comments

to the Commission's copy contractor, International Transcription

Service, 1231 20th Street, N.W., Washington, D.C. 20036.

Pursuant to Sec. 1.1206 of the Commission's Rules, 47 CFR 1.1206,

this proceeding will be conducted as a permit-but-disclose proceeding

in which ex parte communications are permitted subject to disclosure.

For further information, please contact: Richard D. Smith or Lori

Wright, Common Carrier Bureau, (202) 418-7400.

Federal Communications Commission.

William F. Caton,

Acting Secretary.

[FR Doc. 97-24554 Filed 9-12-97; 8:45 am]

BILLING CODE 6712-01-U