Universal Service Reform Act of 2006 - Amends the Communications Act of 1934 concerning procedures for the review of universal service requirements to require the Federal-State Joint Board on universal service to complete recommendations for changes to such requirements within 18 months after the date of enactment of this Act. Includes high-speed broadband services within universal service. Directs the Federal Communications Commission (FCC) to assess contributions to universal service support mechanisms from communications service providers, allowing a limit on the contributions of providers whose customers typically make a low volume of monthly calls. Provides: (1) support contribution limits; and (2) support to non-rural carriers providing service in rural, insular, and high-cost areas.
Outlines network traffic identification accountability standards, rulemaking, and enforcement requirements.
Requires the FCC, within 180 days after the enactment of this Act, to prescribe regulations that require a provider, upon a bona fide request, to provide communications services necessary for the provision of health care services in a state to any health care provider that serves persons who live in rural areas of that state.
Outlines eligibility requirements for communications service providers to receive universal service support, including (with a possible three-year waiver) that the provider meets basic requirements for the deployment and provision of high-speed broadband service.
Makes current limitations on universal service support and individual support caps imposed upon carriers inapplicable after the date of enactment of this Act.
Requires all residential and business lines served by an eligible telecommunications carrier to be eligible for federal universal service support.
[Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5072 Introduced in House (IH)]
109th CONGRESS
2d Session
H. R. 5072
To reform the universal service provisions of the Communications Act of
1934, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
March 30, 2006
Mr. Terry (for himself and Mr. Boucher) introduced the following bill;
which was referred to the Committee on Energy and Commerce
_______________________________________________________________________
A BILL
To reform the universal service provisions of the Communications Act of
1934, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Universal Service Reform Act of
2006''.
SEC. 2. FINDINGS AND PURPOSES.
(a) Findings.--The Congress finds the following:
(1) The current State and Federal mechanisms used to
collect and distribute universal service support are not
sustainable in a competitive and rapidly changing technological
environment.
(2) Voice-over-Internet-Protocol, wireless voice services,
and popular flat rate, all-distance pricing plans for voice
services have rendered meaningless the distinctions between and
among interstate telecommunications and information services,
and between and among intrastate telecommunications services
and information services, thus making universal service support
mechanisms based upon such jurisdictional concepts
unsustainable.
(3) Providing unlimited universal service support to
multiple competing telecommunications carriers in the same
service area results in an excessive demand for universal
service support.
(4) Implicit support mechanisms were the universal service
support mechanisms of choice for State commissions and during
the natural monopoly era that preceded the Telecommunications
Act of 1996. Implicit support mechanisms are effective in
monopoly environments; however, they are inconsistent with the
competitive environment fostered by the 1996 Act, and they
should be eliminated.
(5) The Commission was required by the Telecommunications
Act of 1996 to make all Federal universal service support
mechanisms explicit. Explicit universal service support
mechanisms are appropriate in the competitive
telecommunications marketplace of the 21st century.
(6) Universal service support mechanisms should preserve
incentives for continued investment in and enhancements to the
public switched telephone network and to increase the
availability of broadband services.
(7) Maintaining predictable, sufficient, and sustainable
universal service support will require that support be
collected from a broad base of service providers and in a more
competitively and technology neutral manner.
(8) The aggregate amount of universal service support is
increasing annually and as a result, telecommunications
carriers have had to pay an increased percentage of their total
revenues to support universal service support mechanisms. By
law, telecommunications carriers may pass through these costs
to their subscribers, increasing the amount consumers are
required to pay to maintain the continued growth of universal
service support.
(9) Federal universal service support mechanisms have
succeeded in bringing quality and affordable telecommunications
services to rural areas that are reasonably comparable to those
in urban areas. Existing Federal universal service support
mechanisms have helped to bring telecommunications services to
approximately 95 percent of United States households.
(b) Purposes.--The purposes of this Act are to reform State and
Federal universal service support contribution and distribution
mechanisms by--
(1) targeting universal service support specifically to
eligible telecommunications carriers in high-cost geographic
areas to ensure that communications services and high-speed
broadband services are made available throughout all of the
States of the United States in a fair and equitable manner;
(2) constraining the growth of universal service support by
extending the current cap on the portion of the high cost loop
support mechanism that is distributed to rural incumbent local
exchange carrier study areas to all eligible telecommunications
carriers receiving support from the high cost support
mechanism;
(3) ensuring universal service support contributions are
assessed fairly, equitably, and in a competitively neutral
manner by means of a contribution assessment methodology
determined by the Federal Communications Commission applicable
to any entity that currently contributes to universal service
support, provides real-time voice communications, over any
platform, in which the voice component is the primary function,
or offers a connection to the network over any platform;
(4) strengthening the criteria for eligible recipients of
universal service support: and
(5) ensuring that the United States becomes a world leader
in broadband deployment by making high-speed broadband services
and facilities eligible for universal service support.
SEC. 3. DEFINITIONS.
Section 3(a) of the Communications Act of 1934 (47 U.S.C. 153(a))
is amended--
(1) by redesignating paragraphs (20) through (52) as
paragraphs (22) through (54);
(2) by redesignating paragraphs (11) through (19) as
paragraphs (12) through (20), respectively;
(3) by inserting after paragraph (10) the following new
paragraph:
``(11) Communications service provider.--The term
`communications service provider' means any entity that--
``(A) contributes to or receives universal service
support for the most recent calendar quarter ending
before the date of enactment of the Universal Service
Reform Act of 2006;
``(B) uses telephone numbers or Internet protocol
addresses, or their functional equivalents or
successors, to offer a service or a capability--
``(i) that provides or enables real-time 2-
way voice communications; and
``(ii) in which the voice component is the
primary function; or
``(C) offers for a fee, directly to the public, or
to such classes of users as to be effectively available
directly to the public, a physical transmission
facility, whether circuit-switched, packet-switched, a
leased line, or using radio frequency transmissions,
regardless of the form, protocol, or statutory
classification of the service, that allows an end user
to obtain access, from a particular end user location,
to a network that permits the end user to engage in
electronic communications (including
telecommunications) with the public.''; and
(4) by inserting after paragraph (20) (as redesignated by
paragraph (2) of this section) the following new paragraph:
``(21) High-speed broadband service.--
``(A) Definition.--The term `high-speed broadband
service' means a two way network that uses the Internet
protocol or a successor protocol, and the associated
capabilities and functionalities, services, and
applications provided over an Internet protocol
platform or for which an Internet protocol capability
is an integral component, and services, facilities,
equipment, and applications that enable an end-user to
receive communications in Internet protocol format,
regardless of whether the communications are voice,
data, video, or any other form, at a download receiving
rate not lower than 1 megabit per second.
``(B) Commission speed adjustment requirements.--
The Commission shall review the speed requirement in
subparagraph (A) every other year beginning the sixth
year after implementation of the Universal Service
Reform Act of 2006 and shall make the necessary
adjustments to move to higher speeds as deployment and
advancement of new technology allows communications
service providers to provide higher speed broadband to
end users in an economically efficient manner.
``(C) Internet protocol.--The term `Internet
protocol' means the Transmission Control Protocol/
Internet Protocol, or any predecessor or successor
protocols to such protocol.''.
SEC. 4. UNIVERSAL SERVICE REFORM.
(a) In General.--Section 254 of the Communications Act of 1934 (47
U.S.C. 254) is amended by amending subsections (a) through (e) to read
as follows:
``(a) Procedures to Reform Universal Service.--
``(1) Federal-state joint board on universal service.--
Within one month after the date of enactment of the Universal
Service Reform Act of 2006, the Commission shall institute and
refer to the Federal-State Joint Board under section 410(c) of
this title a proceeding to recommend changes to any of its
regulations in order to implement section 214(e) of this title
and this section (as amended by the Universal Service Reform
Act of 2006), including the definition of the services that are
supported by Federal universal service support mechanisms and a
specific timetable for completion of such recommendations. In
addition to the members of the Joint Board required under
section 410(c) of this title, one member of such Joint Board
shall be a State-appointed utility consumer advocate nominated
by a national organization of State utility consumer advocates.
The Joint Board shall, after notice and opportunity for public
comment, make its recommendations to the Commission 9 months
after the date of enactment of the Universal Service Reform Act
of 2006.
``(2) Commission action.--The Commission shall initiate a
single proceeding to consider the recommendations from the
Joint Board required by paragraph (1) and shall complete such
proceeding within 18 months after the date of enactment of the
Universal Service Reform Act of 2006. The rules established by
such proceeding shall include a definition of the services that
are supported by Federal universal service support mechanisms
and a specific timetable for implementation.
``(b) Universal Service Principles.--The Joint Board and the
Commission shall base policies for the preservation and advancement of
universal service on the following principles:
``(1) Quality and rates.--Quality services should be
available at just, reasonable, and affordable rates.
``(2) Access to advanced services.--Access to advanced
telecommunications and information services should be provided
in all regions of the Nation.
``(3) Access in rural and high cost areas.--Consumers in
all regions of the Nation, including low-income consumers and
those in rural, insular, and high cost areas, should have
access to the services the Commission determines to be
universal services in accordance with subsection (c), including
advanced telecommunications and information services, that are
reasonably comparable to those services provided in urban areas
and that are available at rates that are reasonably comparable
to rates charged for similar services in urban areas.
``(4) Equitable and nondiscriminatory contributions.--All
communications service providers should make equitable and
nondiscriminatory contributions to the preservation and
advancement of universal service.
``(5) Specific and predictable support mechanisms.--There
should be specific, predictable and sufficient Federal and
State mechanisms to preserve and advance universal service.
``(6) Access to advanced telecommunications services for
schools, health care, and libraries.--Elementary and secondary
schools and classrooms, health care providers, and libraries
should have access to advanced telecommunications services as
described in subsection (h).
``(7) Additional principles.--Such other principles as the
Joint Board and the Commission determine are necessary and
appropriate for the protection of the public interest,
convenience, and necessity and are consistent with this Act.
``(c) Definition.--
``(1) In general.--Universal service includes the services
defined on the date of enactment of the Universal Service
Reform Act of 2006 as universal services, high-speed broadband
services, and an evolving level of telecommunications and
information services that the Commission shall establish
periodically under this section, taking into account advances
in telecommunications and information technologies and
services. The Joint Board in recommending, and the Commission
in establishing, the definition of the services that are
supported by Federal universal service support mechanisms shall
consider the extent to which such services--
``(A) are essential to education, public health, or
public safety;
``(B) are being deployed in public
telecommunications networks by communications service
providers; and
``(C) are consistent with the public interest,
convenience, and necessity.
``(2) Alterations and modifications.--The Joint Board shall
consider whether to recommend to the Commission modifications
in the definition of the services that are supported by Federal
universal service support mechanisms no less than once every 5
years.
``(3) Special services.--In addition to the services
included in the definition of universal service under paragraph
(1), the Commission may designate additional services for such
support mechanisms for schools, libraries, and health care
providers for the purposes of subsection (h).
``(4) High-speed broadband service.--The definition of
universal service shall not be construed to exclude eligible
communications service providers from using universal service
funding for the provision, maintenance, and upgrading of high-
speed broadband service.
``(d) Universal Service Support Contributions.--
``(1) Calculating universal service support
contributions.--
``(A) In general.--The Commission shall assess
contributions to universal service support mechanisms
from communications service providers. The Commission
shall assess such contributions in a manner that is
equitable and competitively neutral, is
nondiscriminatory in nature, and ensures that
communications service providers are subject to similar
obligations. The Commission may employ any methodology
to assess such contributions, including consideration
of--
``(i) revenues derived from the provision
of intrastate, interstate, and foreign
communications services by communications
service providers;
``(ii) working telephone numbers used by
communications service providers; or
``(iii) any other current or successor
identifier protocols or connections to the
network used by communications service
providers.
``(B) Use of more than one methodology.--If no one
methodology designated under subparagraph (A)
effectuates the principles described in this Act, the
Commission may employ a combination of any such
methodologies.
``(C) Low volume exception.--The Commission may
limit the contributions of communications service
providers whose customers typically make a low volume
of calls on a monthly basis.
``(D) De minimis exception.--The Commission may
exempt a communications service provider from the
requirements of this subsection if the communications
activities of such provider are limited to such an
extent that the level of contributions of such provider
to the preservation and advancement of universal
service would be de minimis.
``(2) Reports.--The Commission shall establish annual
reporting requirements for all communications service providers
contributing to universal service support mechanisms or
receiving universal service support. The reporting requirements
shall not impose unnecessary burdens, and shall be technology
and provider neutral. The Commission shall periodically review
the reporting requirements to ensure that universal service
support is used for the provision, maintenance, and upgrading
of the facilities for which support is intended.
``(3) Universal service support contribution limits.--
``(A) Limitation.--The total amount of universal
service support for all universal service support
mechanisms other than support for schools, libraries,
rural health care, life-line, link-up, and toll
limitation shall not exceed the total amount that was
collected from all sources for all universal service
support mechanisms other than schools, libraries, rural
health care, life-line, link-up, and toll limitation in
the last year prior to the date of enactment of the
Universal Service Reform Act of 2006, as adjusted
annually by a growth factor and once, within one year
of the date of enactment of the Universal Service
Reform Act of 2006, by the amounts that the adjustments
in subsections (e)(3) and (m) increase demand for
universal service support.
``(B) Growth factor.--The growth factor shall be
the annual percentage change in the Gross Domestic
Product-Chained Price Index (GDP-CPI), or any successor
general inflationary factor that the Bureau of Economic
Analysis of the Department of Commerce determines shall
supersede such index, plus the annual percentage change
in the total number of rural incumbent local exchange
carrier working loops, if that percentage change is
greater than zero.
``(C) Intercarrier compensation recovery
mechanism.--If at any time after the date of enactment
of the Universal Service Reform Act of 2006 the
Commission mandates that intercarrier compensation
revenues be recovered through an alternative revenue
recovery mechanism, such alternative revenue recovery
mechanism shall be included in the limitation set forth
in subparagraph (A), and the Commission shall adjust
such limitation once, within 3 months of mandating that
intercarrier compensation revenues be recovered through
an alternative revenue recovery mechanism, by the
amount that such revenue recovery mechanism increases
demand for universal service support.
``(e) Distribution and Use of Universal Service Support.--
``(1) In general.--Only an eligible telecommunications
carrier designated under section 214(e) shall be eligible to
receive specific Federal universal service support. A carrier
that receives such support shall use that support only for the
provision, maintenance, and upgrading of facilities and
services for which the support is intended. Any such support
should be explicit and sufficient to achieve the purposes of
this section.
``(2) Uses of universal service support.--The use of
universal service support for all rural, insular, and high cost
areas--
``(A) should be expanded to include high-speed
broadband services;
``(B) should be based on actual costs reasonably
incurred in providing such services, exclusive of the
cost of acquiring spectrum, except that an eligible
telecommunications carrier that is an incumbent local
exchange carrier may elect to have the Commission
calculate the amount of universal service support
payable to such carrier pursuant to section 54.309 of
title 47, Code of Federal Regulations (as in effect on
the date of the enactment of the Universal Service
Reform Act of 2006); and
``(C) should be available to communications service
providers that are determined to be eligible
telecommunications carriers under section 214(e).
``(3) Support for non-rural carriers providing service in
rural, insular, and high cost areas.--
``(A) Calculating support.--Except with respect to
non-rural carriers serving insular areas, in
calculating Federal universal service support for
eligible telecommunications carriers that serve rural,
insular, and high cost areas and that are not rural
telephone companies, the Commission shall, subject to
the provisions of subparagraph (B), revise the
Commission's support mechanism for rural, insular, and
high cost areas to provide support to each wire center
in which the incumbent local exchange carrier's average
cost per line for such wire center exceeds 3.75 times
the national average cost per line.
``(B) Hold harmless.--In implementing this
paragraph, the Commission shall ensure that no non-
rural carrier receives less Federal support calculated
under paragraph (1) than the non-rural carrier would
have received under the Commission's support mechanism
for rural, insular, and high cost areas as in effect on
the day before the date of the enactment of the
Universal Service Reform Act of 2006.
``(4) Administration: accountability standards.--
``(A) Network traffic identification accountability
standards.--
``(i) Network traffic identification
standards.--Communications service providers
shall ensure that all traffic that originates
on their networks contains sufficient
information to allow for traffic identification
by other communications service providers that
transport, transit, or terminate such traffic,
including information on the identity of the
originating provider, the calling and called
parties, and the jurisdiction in which the
traffic originates.
``(ii) Network traffic identification
rulemaking.--The Commission, in consultation
with the States, shall initiate a single
rulemaking no later than 180 days after the
date of enactment of the Universal Service
Reform Act of 2006 to establish rules and
enforcement provisions for traffic
identification. Such rules shall include
mandatory requirements for identification of
all traffic by the originating provider and
shall require that such traffic identification
information is transferred to transporting,
transiting, and terminating providers unchanged
and unaltered. The rules shall also establish
procedures for carriers to contest
insufficiently labeled traffic in a prompt
manner and shall establish appropriate
enforcement and penalty provisions for carriers
that insufficiently label traffic. The
processes to adjudicate insufficiently labeled
traffic shall require the relevant providers to
demonstrate their compliance with the
Commission's traffic labeling standards.
``(iii) Network traffic identification
enforcement.--The Commission shall adopt clear
penalties, fines, and sanctions for
insufficiently labeled traffic. The penalties,
fines, and sanctions established by the
Commission shall provide--
``(I) adequate retroactive monetary
reimbursement to the defrauded provider
or providers equal to the rate
differential between accurately and
inaccurately labeled traffic;
``(II) monetary fines determined by
the Commission;
``(III) a deterrence penalty for
those offenders who do not resolve
their violations or remit the required
reimbursements to defrauded provider or
providers;
``(IV) an adequate deterrence
penalty against frivolous accusations;
``(V) the ability of network
traffic operators to block inaccurately
labeled traffic;
``(VI) the decertification of
repeat offenders or those providers
unwilling to comply with the
established rules and penalties; and
``(VII) specific and clear time
frames for the investigation and
subsequent penalty, fines, and
sanctions of offending providers, to
ensure proper accountability.
``(iv) Accountability for network traffic
exchange.--To ensure that all communications
service providers are accountable for the
volume of traffic the providers terminate on
other carriers' networks, the Commission shall
ensure that all providers are compensated for
the use of their networks by other providers.
``(B) Universal service distribution accountability
standards.--To ensure fairness and accountability in
the distribution of universal service funding
contributions, the Commission shall promulgate rules to
calculate the level of universal service support to be
distributed to all eligible recipients.''.
(b) Rural Health Care Support Mechanisms.--
(1) Amendment.--Subparagraph (A) of section 254(h)(1) of
the Communications Act of 1934 (47 U.S.C. 254(h)(1)) is amended
to read as follows:
``(A) Health care services for rural areas.--Within
180 days after the date of enactment of the Universal
Service Reform Act of 2006, the Commission shall
prescribe regulations that provide that a
communications service provider shall, upon, receiving
a bona fide request, provide covered services which are
necessary for the provision of health care services in
a State, including instruction relating to such
services, to any public or nonprofit health care
provider that serves persons who reside in rural areas
in that State at rates that are reasonably comparable
to rates charged for similar services in urban areas in
that State. A communications service provider providing
service under this subparagraph shall be entitled to
have an amount equal to the difference, if any, between
the rates for services provided to health care
providers for rural areas in a State and the rates for
similar services in urban areas in that State treated
as a service obligation as a part of its obligation to
participate in the mechanisms to preserve and advance
universal service.''.
(2) Definition of health care provider.--Subparagraph (B)
of section 254(h)(7) of such Act (47 U.S.C. 254(h)(7)(B)) is
amended to read as follows:
``(B) Health care provider.--The term `health care
provider' means--
``(i) post-secondary educational
institutions offering health care instruction,
teaching hospitals, and medical schools;
``(ii) community health centers or health
centers providing health care to migrants;
``(iii) local health departments or
agencies;
``(iv) community mental health centers;
``(v) not-for-profit hospitals;
``(vi) critical access hospitals;
``(vii) rural hospitals with emergency
rooms;
``(viii) rural health clinics;
``(ix) not-for-profit nursing homes or
skilled nursing homes;
``(x) hospice providers;
``(xi) emergency medical services
facilities;
``(xii) rural dialysis facilities;
``(xiii) elementary, secondary, and post-
secondary school health clinics; and
``(xiv) consortia of health care providers
consisting of one or more entities described in
clauses (i) through (xiii).''.
(3) Definition of rural for health care support.--Section
254(h)(7) of such Act is further amended by adding at the end
the following new subparagraph:
``(J) Rural area.--Within 180 days after the date
of enactment of the Universal Service Reform Act of
2006, the Commission shall prescribe regulations that
provide that, for purposes of the rural health care
universal service support mechanisms established
pursuant to this subsection, a `rural area' is--
``(i) any incorporated or unincorporated
place in the United States, its territories and
insular possessions (including any area within
the Federated States of Micronesia, the
Republic of the Marshall Islands and the
Republic of Palau) that has no more than 20,000
inhabitants based on the most recent available
population statistics from the Census Bureau;
``(ii) any area located outside of the
boundaries of any incorporated or
unincorporated city, village, or borough having
a population exceeding 20,000;
``(iii) any area with a population density
of fewer than 250 persons per square mile; or
``(iv) any place that qualified as a `rural
area' and received support from the rural
health care support mechanism pursuant to the
Commission's rules in effect prior to December
1, 2004, and that continues to qualify as a
`rural area' pursuant to such rules.''.
(c) Schools, Libraries, Rural Health Care, Life-Line, Link-Up, and
Toll Limitation Hold Harmless.--Except as provided in subsections
(h)(1)(A), (h)(7)(B), and (h)(7)(J) of section 254 of the
Communications Act of 1934 (47 U.S.C. 254), as amended by subsection
(b)--
(1) nothing in this Act (and the amendments made by this
Act) shall be construed as limiting, changing, modifying, or
altering the amount of support or means of distribution for the
schools, libraries, rural health care, life-line, link-up, and
toll limitation programs; and
(2) the Federal Communications Commission shall ensure that
such amendments do not result in a decrease of such support to
a level below the level for the fiscal year preceding the
fiscal year in which this Act is enacted.
SEC. 5. ELIGIBLE RECIPIENTS OF UNIVERSAL SERVICE SUPPORT.
(a) Amendment.--Section 214(e) of the Communications Act of 1934
(47 U.S.C. 214(e)) is amended--
(1) by redesignating paragraphs (3), (4), (5), and (6) as
paragraphs (6), (7), (9), and (8), respectively, and reordering
such paragraphs in numerical order; and
(2) by striking paragraphs (1) and (2) and inserting the
following:
``(1) Eligibility to receive universal service support.--A
communications service provider shall be eligible to receive
universal service support in accordance with the requirements
of this subsection only if such communications service
provider--
``(A) uses its own facilities to make available in
a service area the services that have been determined
by the Commission to be universal services pursuant to
section 254(c), and responds to reasonable requests for
service from persons located anywhere in such service
area consistent with carrier-of-last-resort
requirements in the State in which the requesting
person is located;
``(B) advertises the supported services and their
associated charges throughout the service area using
media of general distribution, and advertises the
availability of life-line and link-up services in a
manner reasonably designed to reach those likely to
qualify for those services;
``(C) demonstrates the ability to remain functional
in emergency situations;
``(D) satisfies consumer protection and service
quality standards; and
``(E) meets the basic requirements for the
deployment of high-speed broadband service, and
provides high-speed broadband service, except that the
Commission shall establish a process--
``(i) whereby a determination can be made
to waive the requirements of this subparagraph
for 3 years upon application of a
communications service provider demonstrating
that the deployment and provision of high-speed
broadband service is not technically feasible
or would materially impair the communications
service provider's ability to continue to
provide local exchange service throughout its
service area, except that a waiver shall be
deemed automatically granted under this clause
for a communications service provider which can
demonstrate that the cost per line of deploying
and providing high-speed broadband service is
at least three times the average cost of
providing high-speed broadband service among
all recipients of universal service support,
subject to the renewal provisions set forth in
clause (ii);
``(ii) whereby the communications service
provider may seek renewal of such waiver every
3 years for as long as the deployment and
provision of high-speed broadband service is
not technically feasible or would materially
impair the communications service provider's
ability to continue to provide local exchange
service throughout its service area; and
``(iii) whereby any application of a
communications service provider for a waiver
pursuant to clause (i) on which the Commission
has not taken final action within 60 days of
the date of submission to the Commission shall
be deemed granted.
``(2) Eligibility criteria.--In addition to the criteria
specified in paragraph (1), the Commission shall establish such
additional eligibility criteria for the receipt of universal
service support by communications service providers as it deems
necessary and in the public interest. The criteria established
in paragraph (1) and the criteria established by the Commission
pursuant to this paragraph shall be used by State commissions
in determining which providers shall be designated as eligible
recipients of universal service support for the purpose of
paragraph (3).
``(3) Designation of eligible recipients.--A State
commission shall, upon its own motion or upon request,
designate as an eligible recipient of universal service support
only those providers meeting the requirements of paragraphs (1)
and (2).
``(4) Grandfather provision.--Recipients of universal
service support in any service area prior to the date of
enactment of the Universal Service Reform Act of 2006 shall
meet the eligibility requirements for eligible recipients of
universal service support--
``(A) as described in paragraphs (1)(A) through (D)
within one year of the date of enactment of the
Universal Service Reform Act of 2006; and
``(B) as described in paragraph (1)(E) within 5
years after the date of enactment of the Universal
Service Reform Act of 2006.
Failure of such an eligible recipient of universal service
support to maintain and meet the eligibility requirements
within the period required by subparagraph (A) or (B) after the
date of enactment of the Universal Service Reform Act of 2006
shall require the automatic termination of Federal universal
service support to that recipient. This paragraph shall not be
construed to prohibit such a recipient from obtaining a waiver
under paragraph (1)(E).
``(5) State authority.--Nothing in this Act or the
Universal Service Reform Act of 2006 precludes a State from
establishing funding mechanisms to preserve and advance
universal service within that State pursuant to section 254(f)
of this Act.''.
(b) Definitions.--Paragraph (9) of section 214(e) (as redesignated
by subsection (a)) is amended to read as follows:
``(9) Definitions.--As used in this subsection, the term
`service area' means a geographic area that aligns with the
area in which a communications service provider is licensed or
authorized to provide service for the purpose of determining
universal service obligations and support mechanisms. In the
case of an area served by a rural telephone company, `service
area' means such company's `study area' or the licensed or
authorized service area of any other communications service
provider serving an area that overlaps with the service area of
a rural telephone company.''.
SEC. 6. REMOVAL OF IMPEDIMENTS TO SUFFICIENT SUPPORT MECHANISMS.
Section 254 of the Communications Act of 1934 is amended by adding
at the end the following new subsection:
``(m) Removal of Limitations on High Cost Support Mechanisms.--The
limitations on universal service support contained in section 54.305 of
the Commission's regulations (47 C.F.R. 54.305), and the individual
caps imposed upon carriers contained in section 36.631 of the
Commission's regulations (47 C.F.R. 36.631), shall cease to be
effective on the date of enactment of the Universal Service Reform Act
of 2006. The Commission shall not, on or after such date of enactment,
enforce or reimpose limitations on support mechanisms for rural
telephone companies or exchanges they acquire based on fund size or
other considerations unrelated to the sufficiency of support to achieve
the purposes of this section.''.
SEC. 7. APPLICATION OF ANTIDEFICIENCY ACT.
(a) Making Antideficiency Act Exemption Permanent.--Section 254 of
the Communications Act of 1934 (47 U.S.C. 254) is amended by adding the
following subsection (n):
``(n) Application of Antideficiency Act.--Section 1341 and
subchapter II of chapter 15 of title 31, United States Code, do not
apply--
``(1) to any amount collected or received as Federal
universal service contributions required by this section,
including any interest earned on such contributions; nor
``(2) to the expenditure or obligation of amounts
attributable to such contributions for universal service
support programs established pursuant to this section.''.
(b) Investment of Universal Service Fund Contributions.--
Notwithstanding any other provision of law, including but not limited
to sections 3302, 3321, 3322, and 3325 of title 31, United States Code,
the cash balance of receipts of universal service contributions
collected pursuant to section 254 of the Communications Act of 1934 (47
U.S.C. 254) shall be invested by the Commission or its designee in
conservative, liquid, interest-bearing investment vehicles of
government backed securities until such time as such receipts are
disbursed pursuant to section 254 of the Communications Act of 1934 (47
U.S.C. 254).
SEC. 8. SCOPE OF SUPPORT.
The Commission in implementing the requirements of this Act with
respect to the distribution and use of Federal universal service
support shall not limit such distribution and use to a single
connection or primary line, and all residential and business lines
served by an eligible telecommunications carrier shall be eligible for
Federal universal service support.
SEC. 9. REPORT TO CONGRESS.
The Commission shall, not later than 3 years after the date of
enactment of this Act and triennially thereafter, report to Congress
regarding the availability of the services designated by the Commission
as universal services to all Americans, including schools, libraries,
rural health care providers, and low income consumers.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Energy and Commerce.
Referred to the Subcommittee on Telecommunications and the Internet.
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