On May 7, the Federal Communications Commission (FCC) released it's plan for the implementation of the Telecommunications Act of 1996.
A major part of the act, the universal service provision, requires that all Americans, including low-income consumers and those who live in rural, insular, high-cost areas, should have affordable universal service. The FCC's new plan will help to connect eligible schools, libraries and rural health care providers to the global telecommunications network.
The commission's plan will provide basic services such as single party service, access to emergency operators, interchange and directory assistance as well as Lifeline and Link Up service for schools, libraries, low-income qualifying consumers and rural areas.
The FCC's plan also ensures that rural, small and high-cost telephone companies continue to receive support through a universal service fund. This financial support is only available to those carriers that are eligible by being common carriers which offer and advertise the designated services supported by the universal service. The states will have statutory authority to designate carriers eligible to receive support.
The commission found that the methods that determine the costs for implementing service in high-cost areas were not reliable, and in June, will issue a notice seeking further information on universal service mechanisms.
The commission recommended that individual states continue to monitor factors involved in providing universal service to ensure local telephone services remain affordable to communities. The commission will also continue to explore the use of competitive bidding as a mechanism to provide universal service.
In light of concerns about affordability, the FCC stated that the subscriber line charge (SLC) for primary residential and single business lines will not rise.
The order modifies the Lifeline and Link Up Programs so that consumers in every state and territory can receive federal support with matching funds from the states. The Order will make the contribution to and distribution of low-income support competitive and technologically neutral by requiring all providers of interstate telecommunications services to contribute to the fund. These same carriers would be eligible to receive financial support for offering the Link Up and Lifeline service.
Eligible schools and libraries will be provided with the opportunity to purchase - at a discount - all commercially available telecommunications services. These discounts will range from 20 percent to 90 percent with the higher discounts being provided to the most disadvantaged schools and libraries and those in high- cost areas. Although the support funds for schools and libraries is capped at $2.5 billion per year beginning in January 1998, any funds not disbursed in any given year can be rolled over into following years.
All public and nonprofit health care providers located in rural areas will be provided with universal service support not to exceed $400 million. A health care provider may obtain telecommunications service at a transmission capacity up to and including 1.544 (bandwidth equivalent to T-1) at rates comparable to those paid for similar service in the nearest urban area with more than 50,000 residents.
Rural health care providers will receive support for both distance-based charges and a toll-free connection to an Internet service provider. Each health care provider that lacks toll-free access to an Internet service provider may also receive the lesser of 30 hours of Internet access at local calling rates per month or $180 per month in toll charges imposed for connecting to the Internet.
Each state will have to have its own proceeding to implement the universal service program on the state level. This proceeding, like the FCC proceeding, will be open to public comment. County officials need to be vocal in these proceedings to ensure their county schools, libraries and rural health care providers are provided with adequate universal service access.
The commission has appointed the National Exchange Carriers Association (NECA) as the temporary administrator of the support mechanisms.
(For more information on the commission's actions, visit their Web site at <http://www.fcc.gov.> or contact Rochelle Cohen at 202/418-0253.)