USAC Announces the Issuance of Website Assessment and Redesign RFP

The Universal Service Administrative Company (USAC) is requesting proposals from organizations for consulting services to complete a Usability Study, Information Architecture Assessment, and Requirements Analysis for a potential overhaul of the www.universalservice.org web presence. The Request for Proposal (RFP) describes the services requested and provides instructions on how to respond. Interested parties may request further information by submitting an inquiry via E-mail. Proposals must be submitted to USAC by 5 p.m. on January 14, 2005.

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The Proposed Contribution Factor for the 1st quarter of 2005 is 10.7% (12/14/04)

The prposed contribtuion factor for the 1st quarter (Jan-Mar) of 2005 is 10.7%. For more information please visit the FCC Web site.

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New Contact Information for all 499 filings and inquiries

Effective December 10, 2004 the physical mailing address and telephone number for all FCC form 499 filings and related matters will change.

For all correspondence sent beginning December 10, 2004 the new address will be:

Universal Service Administrative Company
Attn: FCC Form 499 Data Collection Agent
2000 L Street NW
Suite 200
Washington, DC 20036

Contact Telephone: 888-641-8722 Option 2 Option 1

Please be sure to update your records to avoid potential penalties caused by delays in inquiries or form filings. If you have any questions regarding this notice please contact USAC at 888-641-8722 option 2, option 1.

The email address Form499@universalservice.org and the website address Http://form499.universalservice.org are not impacted by this change.

All other addresses for USAC correspondence remain unaffected by this change. Please contact USAC at 888-641-8722 with any questions or inquiries.

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Congress passes one year USAC exemption from Anti Deficiency Act

The United States Senate last night (12/8/04) passed a bill (H.R. 5419) to grant the Universal Service Fund a one year exemption (through December 31, 2005) from the accounting provisions of the Anti-Deficiency Act. Once the bill has been signed into law, USAC will work with the FCC to implement its provisions. As more information becomes available we will keep you posted.

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Red Light Rule Effective November 1, 2004

Effective November 1, 2004, USAC will follow new collections and disbursement policies when it implements the “Red Light Rule.” Under the Red Light Rule, USAC will not disburse any Federal benefits to an entity that shares the same taxpayer identification number (TIN) as an entity that has delinquent debt owed to the Commission or its reporting components until such debt is paid, formally appealed, or until other arrangements, satisfactory to the FCC, are made for payment. For Red Light Rule purposes, “entity” includes contributors, beneficiaries, or other organizations or individuals who are delinquent to the USF.

For additional information regarding the Red Light order, please refer to the public notice on the FCC’s website.

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USAC to Resume Issuing Funding Commitment Decision Letters

In early August, USAC suspended issuance of Funding Commitment Decision Letters (FCDLs) for both schools and libraries and rural health care providers for all funding years. USAC has worked closely with the FCC since then and has now determined the amount of unobligated cash it has available to cover new commitments and will resume issuing new FCDLs within the next two weeks.

In issuing FCDLs, USAC will follow the prioritization principles posted on this web site on October 27. Note that available funds are calculated separately for each support mechanism.

Generally, commitments will be issued for applications and meritorious appeals for funding years prior to Funding Year 2004 first and then, for Funding Year 2004, requests for telecommunications services and Internet access (Priority 1) first and, for schools and libraries, internal connections second. If funds are not sufficient for all pending requests within one priority, requests will be funded based on the date the application review was completed.

USAC expects to have sufficient funds to make commitments on all pending Rural Health Care requests that have completed review and generally to be able to issue FCDLs on other pending applications as review is completed.

With respect to the Schools and Libraries mechanism, USAC expects to issue FCDLs for all applications for funding years prior to 2004 that have completed review and to have sufficient funds to make commitments for Priority 1 services on some portion of the applications that have completed review based on the date of completion. As additional funds become available through contributions to the Universal Service Fund and through "deobligation" of previously committed funds (for example, funds committed for recurring services for Funding Year 2003 and not invoiced by October 28, 2004), USAC will make additional commitments -- first for prior-year applications and appeals and then for Priority 1 requests on applications for 2004. Commitments for prior years will be made as they become ready. For Funding Year 2004, USAC expects to issue periodic "waves" of commitments. USAC cannot predict the exact timing at this time, but expects at least one such wave a month.

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Priorities for Making Funding Commitments if Unobligated Cash is Insufficient to Issue All Pending Commitments

The Federal Communications Commission (FCC) began treating funding commitment decision letters (FCDLs) issued for the Universal Service Schools and Libraries and Rural Health Care Support Mechanisms as budgetary obligations on September 30, 2004. At that time, the Universal Service Administrative Company (USAC) began tracking the amount of unobligated Universal Service Fund (USF) monies on hand to support new funding commitments. USAC expects that, going forward, at various times, it may have less unobligated cash than the total dollar value of new commitments ready to be issued.

USAC does not know precisely when it will be able to resume issuing FCDLs for Schools and Libraries and Rural Health Care providers but it has estimated that it will resume issuing FCDLs by late November, if not sooner. In consultation with the Commission, USAC has set forth principles for processing FCDLs based on a series of priorities, set forth below.

FCDLs for Prior Years will be Processed First: Because funds have been collected for prior funding years and collection is still under way for funding year 2004, available funds will be used first for commitment of prior-year funds before commitments for 2004, with the highest priority going to the oldest funding years. This includes original commitments and commitments for meritorious appeals. It also includes commitments for Priority 1 and Priority 2 services within the Schools and Libraries Mechanism. Funding year 2004 commitments will be processed after unobligated funds have been allocated to prior-year commitments.

Funds will be Used in the Mechanism for which They were Collected: Funds collected and allocated to each of the Schools and Libraries and Rural Health Care Support Mechanisms will be used to calculate the amount of unobligated funds available to that mechanism.

Telecommunications Services and Internet Access have Priority over Internal Connections: Within each schools and libraries funding year, commitments for telecommunications service and Internet access (Priority 1 services) for all discount categories have priority over commitments for internal connections (Priority 2 services), consistent with FCC rules.

Priority Based on Date of Completion of Application Review: Within the categories above, commitments will be issued in the order that application review was completed. USAC processes applications based on when it receives all of the information needed to complete the review. That includes, for Schools and Libraries, Item 21 attachments to FCC Forms 471 submitted at the beginning of the process and any additional documentation requested during application review. If an applicant provides timely and complete documentation, its application generally continues through the process quickly. If review must wait for documentation, processing will be delayed. Rural health care commitments will be processed in a similar manner.

Determination of Commitments to Issue: USAC will determine the amount of unobligated cash available and then determine what applications can be committed by applying the prioritization principles above and identify all that could be funded with the unobligated cash available. If an application cannot be funded with the remaining available funds, it will be set aside and given priority during the next wave of commitments.

Coordination with FCC staff: USAC staff will work in close coordination with FCC staff to implement these prioritization principles. At least quarterly and prior to issuance of any waves of commitments, USAC will provide FCC staff information concerning the amount of unobligated monies on hand and anticipated commitments. If USAC proposes to fund any lower priority requests in a quarter while higher priority requests are still pending in review, it will explain to FCC staff when it expects to be ready to make those higher priority commitments and why it expects that there will be funds available at that time to make those commitments.

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USAC Announces the Issuance of Storage Area Network RFP

The Universal Service Administrative Company (USAC) is requesting proposals from organizations to provide and implement a Storage Area Network. The Request for Proposal (RFP) describes the services requested and provides instructions on how to respond. Interested parties may request further information by submitting an inquiry via E-mail. Proposals must be submitted to USAC by 5 p.m. on October 27th, 2004.

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Notice Regarding Temporary Suspension Of Schools And Libraries And Rural Health Care Support Mechanism Funding Commitments

The Federal Communications Commission (FCC) directed the Universal Service Administrative Company (USAC), the administrator of the Schools and Libraries (E-rate) and Rural Health Care Universal Service Support Mechanisms, to change USAC’s accounting methodology by October 1, 2004 to the same methodology that the Federal Government uses. Among other things, we were informed that this required USAC to change the rules that we use to account for various financial transactions, including funding commitments in those programs. The accounting changes were not intended to have any impact on the way in which we administer the programs themselves.

It is important to note that USAC is currently and always has been able to pay any and all invoices that are received pursuant to previously-issued funding commitments in the E-rate program and Rural Health Care Support Mechanism—we are continuing to pay all approved invoices associated with any funding commitment that has been issued and will continue to do so. The new accounting rules do not affect disbursement of funds, only the issuance of new commitments.

The rules USAC must now use to account for our financial transactions are the reasons we have had to temporarily suspend issuing Funding Commitment Decision Letters (FCDLs) to applicants in the E-Rate program and the Rural Health Care Support Mechanism. In the past, USAC allocated funds for accounting purposes to pay for services in those programs at the time an invoice submitted by a service provider was approved for payment. Under the new accounting rules, however, it has been determined that issuance of the FCDL is the point at which an “obligation” occurs for Federal Government accounting purposes. Another significant change requires USAC to have cash or federal securities on hand at least equal to the value of all its outstanding FCDLs. Until this decision, USAC was only required to have money on hand when the vendor sent an invoice to USAC for payment.

USAC has sufficient funds on hand to cover all FCDLs it has issued; however, we cannot issue any new funding commitments until additional unobligated funds are made available. At this time, and as some prior FCDLs expire, we expect to be able to issue some funding commitments in the E-rate and Rural Health Care programs by late November 2004. We are doing all we can to be able to act sooner. USAC is working very closely with the FCC to resolve issues as quickly as possible, including the priority of commitments to be issued as we become able to issue new FCDLs.

We deeply regret the disruptions and hardships that have resulted from these events. Please be assured that we are working closely with the FCC to begin issuing FCDLs again as soon as possible while complying with all applicable government accounting rules. Please also be assured that we are continuing to review applications so that we will be able to issue FCDLs in the E-rate program and the Rural Health Care Support Mechanism immediately upon being allowed to do so once we have sufficient unobligated funds.

Please continue to check our website for updated information.

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FCC Announces Brief Delay In Enforcement Of The Red Light Rule

The FCC has determined that the public interest will be served if it delays enforcement of the recently adopted Red Light Rule from October 1, 2004 to November 1, 2004. USAC encourages all fund contributors and service providers to ensure that all balances owed to USAC, the FCC or any of the other reporting agencies are current at this time. For more information on Red Light and the delay, please see the FCC notice.

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The Proposed Contribution Factor for the Fourth Quarter 2004 is 0.089 or 8.9%

The proposed Contribution Factor for the Fourth Quarter of 2004 is 8.9%. For additional details please visit the FCC Web site.

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Informational Notice to All Universal Service Fund Contributors, Beneficiaries, and Service Providers

Effective October 1, 2004, USAC will implement new collections and disbursement procedures as a result of further implementation of the Federal Debt Collection Improvement Act of 1996 (DCIA) by the Federal Communications Commission (FCC). The new rules, codified at 47 C.F.R. Parts 0 and 1, contain specific provisions at §§ 1.1112, 1.1116, 1.1161, 1.1167, and 1.1910 and include a rule commonly referred to as the “Red Light Rule.” Under the Red Light Rule, USAC will not disburse any Federal benefits to an entity that shares the same taxpayer identification number (TIN) as an entity that has delinquent debt owed to the Commission or its reporting components until such debt is paid, formally appealed, or until other arrangements, satisfactory to the FCC, are made for payment. For Red Light Rule purposes, “entity” includes contributors, beneficiaries, or other organizations or individuals who are delinquent to the USF.

USAC will coordinate closely with the FCC and with the administrator of the Telecommunications Relay Services Fund (TRS) and the Billing and Collections Agent, the North American Numbering Plan Administrator, and the Pooling Administrator for North American Numbering Plan Administration (NANPA. The FCC has determined that entities with any unpaid delinquent obligations to the FCC or to any of these funds are subject to the Red Light Rule.

USAC, the FCC, and the other fund administrators, are committed to collecting, on a timely basis, all outstanding debts. A debt or claim by the government is delinquent if the full amount has not been paid by the date specified in the initial written demand for payment. A written demand for payment includes an advance billing notice, or monthly invoice, with a specified payment due date. With respect to the Universal Service Fund (USF), any entity who owes money to the USF will be considered delinquent if payment is not made by the due date specified on the monthly invoice. When an entity’s account becomes delinquent, that entity, as well as any other entity with a Service Provider Identification Number (SPIN) associated through a shared TIN, will be considered in “red light” status. USAC will not make any disbursements to the associated SPIN or SPINs until the delinquency has been satisfied by the entity or until arrangements for payment, satisfactory to the FCC, have been made, such as entering into an approved payment plan. USAC will notify the FCC and the other supporting funds on a daily basis of all TINs that are in red light status. Any pending benefits to entities associated to this TIN will be withheld. Delinquent entities shall receive a notice that details the operation of the Red Light Rule and that requires payment or satisfactory proof that payment has already been made. Entities shall have 30 days from the date of that notice to pay the delinquency or make other arrangements, satisfactory to the FCC, for payment. Failure to do so will result in the dismissal of any pending request before the FCC, and the initiation of further debt collection efforts.

USAC will receive red light status information from the FCC and the other funds on a daily basis and will withhold any pending disbursements to entities associated with a delinquent TIN. Until USAC is notified by the FCC or the other funds that the debt has been satisfied, no pending disbursements will be issued.

USAC may also offset delinquent debt against pending disbursements. If an entity is delinquent and a payment is pending to an entity sharing the TIN of the delinquent entity, USAC may apply the amount of any pending disbursements towards the delinquent balance.

At the time that a disbursement is held because an entity is in red light status, USAC intends to send the entity and/or Service Provider an e-mail notification. If USAC uses a pending disbursement to offset a USF delinquency, USAC intends to notify the delinquent entity and/or Service Provider.

In order to avoid losing benefits from the USF and the FCC, USAC encourages all entities to pay invoices no later than the due date.

For additional information, please refer to the FCC's public notice published on September 8, 2004.

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USAC Issues RFP for Document Management System

The Universal Service Administrative Company (USAC) is requesting proposals from organizations for a document management system to include implementation services, software licensing, and hardware. The Request for Proposal (RFP) describes the system requirements and provides instructions on how to respond. Interested parties may request further information by submitting an inquiry via E-mail. Proposals must be submitted to USAC by 5 p.m. on July 30th, 2004.

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The Contribution Factor for the Third Quarter of 2004

The Contribution Factor for the Third Quarter of 2004 (July-September) is 8.9%. For additional Details please visit this link.

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USAC Announces the Issuance of Disbursements Print Services RFP

The Universal Service Administrative Company (USAC) is requesting proposals from organizations to provide print services to support its Disbursements function. The Request for Proposal (RFP) describes the services requested and provides instructions on how to respond. Interested parties may request further information by submitting an inquiry via E-mail. Proposals must be submitted to USAC by 5 p.m. on June 14, 2004.

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USAC Announces the Issuance of Billing & Collections Print Services RFP

The Universal Service Administrative Company (USAC) is requesting proposals from organizations to provide print services to support its Billing & Collections functions. The Request for Proposal (RFP) describes the services requested and provides instructions on how to respond. Interested parties may request further information by submitting an inquiry via E-mail. Proposals must be submitted to USAC by 5 p.m. on June 14, 2004.

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USAC Announces the Issuance of Billing & Collections Print Services RFP

The Universal Service Administrative Company (USAC) is requesting proposals from organizations to provide print services to support its Billing & Collections functions. The Request for Proposal (RFP) describes the services requested and provides instructions on how to respond. Interested parties may request further information by submitting an inquiry via E-mail. Proposals must be submitted to USAC by 5 p.m. on June 14, 2004.

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USAC Announces the Issuance of Network Vulnerability and Risk Assessment RFP

The Universal Service Administrative Company (USAC) is requesting proposals from organizations to perform a Network Vulnerability and Risk Assessment. The Request for Proposal (RFP) describes the services requested and provides instructions on how to respond. Interested parties may request further information by submitting an inquiry via E-mail. Proposals must be submitted to USAC by 5 p.m. on May 19th, 2004.

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The Office of Management and Budget (OMB) approves the Revised FCC Form 499-A for Reporting 2003 Revenue

On March 17, 2004, the Office of Management and Budget approved the revised Telecommunications Reporting Worksheet (FCC Form 499-A, “Worksheet”) for 2003 revenue. Completed Worksheets are due April 1, 2004.

USAC encourages the use of the 499 online submission tool. The online submission is intended to expedite the filing process by performing a series of validations throughout the application, which will help eliminate common data entry issues.

Upon completing the online submission, the applicant must print, sign and return the forms to USAC to be officially certified.

Applicants can register online for a User ID and Password through the 499-A online tool. This link will also take you to the online Form 499-A.

For more information on completing the 499-A, please refer to the Form 499-A Instructions. If you need additional assistance in completing the form, please call the 499 Helpline at (973) 560-4460 or send an email to the Form 499 Data Collection Staff.

Please remember that the deadline for submitting your Form 499A is April 1, 2004 at 11:59 PM EST.

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USAC Announces Phased Launch of the New FCC Form 498 for HC and LI Service Providers

The FCC Form 498 is used by carriers to obtain a Service Provider Identification Number (SPIN), to provide certain contact information and, most importantly, to direct USAC where to send the carriers' universal service payments.  This form was recently revised by the Federal Communications Commission, and each carrier receiving high cost and low income support is required to submit a revised Form 498 to USAC. 

USAC is taking a phased approach to launching the new Form 498 to ensure that all submissions are processed in a timely fashion.  That is, the state in which you are located dictates when you should file your Form 498.  The following table will help you determine when to file your Form 498 and when the elections you make on that form will be reflected in your high cost and low income payments.

USAC would also like to make you aware of the following helpful hints:

• You should submit the Form 498 on-line.  Go to USAC's website and follow the instructions to submit the form on-line.
• There is absolutely no advantage to submitting your form in advance of the deadlines outlined in the table.  USAC will work to ensure that your high cost and low income payments continue uninterrupted.
• Today, most NECA member companies receive their high cost and low income payments through NECA who, in turn, receives those funds on your behalf from USAC.  You may opt to continue that process by entering NECA's banking information in blocks 4 and 6 of the Form 498.  On the other hand, you may opt to receive your high cost and low income payments directly.  In that case, you would enter your own banking information in blocks 4 and 6 of the Form 498.  In either case, please be assured that the calculation of your support will not change.
• Please visit the High Cost website or the Low Income website for a set of frequently asked questions (FAQs) on the Form 498 and the filing process.  A copy of the FAQs is also enclosed for your reference.  If you have additional questions, please feel free to email USAC's Billing, Collections, and Disbursements Call Center or call 1-888-641-8722.

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FCC Wireline Competition Bureau Releases Draft of Revised FCC Form 499-A For Reporting 2003 Revenue

On February 26, 2004, the FCC Wireline Competition Bureau (WCB) released a draft of the revised Telecommunications Reporting Worksheet (FCC Form 499-A, “Worksheet”) for 2003 revenue. The form has not yet been finalized and is under review by the Office of Management and Budget (OMB) for approval.

This draft is being released in order to allow carriers maximum opportunity to prepare to complete the revised Worksheet. The draft form is not for submission and should not be submitted for review. Upon OMB approval, the final Worksheet will be made available to contributors.

Completed Worksheets are due April 1, 2004. It is anticipated that the final Worksheet will be available for submission by mid March.

View the FCC Public Notice
View the DRAFT 2004 Form 499-A (not for submission!)
View the DRAFT 2004 Form Instructions

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USAC Names New CEO

The Universal Service Administrative Company (USAC) is pleased to announce that Lisa M. Zaina will become its CEO. The Board of Directors unanimously elected Ms. Zaina as CEO at their January meeting after the Chairman of the Federal Communications Commission (FCC) approved the selection. Ms. Zaina will start with USAC on March 1, 2004. View FCC Press Release

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USAC Board Of Directors Elects Eight Members

WASHINGTON, D.C. – On Thursday December 18, the Universal Service Administrative Company (USAC) Board of Directors elected eight individuals to the USAC Board. Six individuals fill the Board of Directors terms that begin on January 1, 2004 and two individuals were appointed to fill two current vacancies. Following are the Board members elected today:

• Jonathan Askin, General Counsel, ALTS - representing CLECs (fills vacancy)
• Dave Baker,Vice President, Law and Public Policy, EarthLink, Inc. - representing information service providers
• Dr. Douglas Christensen, Nebraska Commissioner of Education - representing schools
• Bridget Duff, Director, Education and Government Policy, Cox Communications, Inc - representing cable providers (fills vacancy)
• Kevin Hess, Vice President of Federal Affairs, TDS TELECOM - representing medium size LECs
• Joel Lubin, Vice President, AT&T Washington D.C. - representing large IXCs
• Dr. Jay Sanders, President and CEO, The Global Telemedicine Group - representing rural health care providers
• Jo Anne Sanford, Chair, North Carolina Utility Commission - representing state utility regulators

The USAC Board of Directors will elect officers and committee Chairpersons at the regular quarterly Board and Committee meetings in January 2004.

USAC is a private, not-for-profit company and is responsible for providing every state and territory in the United States with access to affordable telecommunications services through the Universal Service Fund. USAC administers four programs, the High Cost Support Mechanism, Low Income Support Mechanism, Rural Health Care Support Mechanism, and the Schools and Libraries Support Mechanism. All of the country's communities - including public and private schools, public libraries, rural health care providers, low-income neighborhoods, and remote communities, such as rural areas - are eligible to seek discounts for communications services from the Universal Service Fund.

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