Few people keep an eye on changes to USF like Brent Christensen at Minnesota Telecom Alliance (MTA). His members include independent, local telephone companies. They are on the front lines of providing broadband, especially in rural areas. The USF (Universal Service Funds) policy isn’t academic to them; the policy changes how they need to bill, process and pay for connectivity. Brent has kindly given me permission to repost his latest newsletter. I think it is an interesting glimpse at the tangible changes brought about because of the shifts in USF. (If you want a greater glimpse into the world of the independent telecommunication provider, you might consider attending the MTA Annual Conference March 25-27.)

Overview:  On February 6, 2012, the FCC released its Order reforming and modernizing the Lifeline and Link Up Programs.  The Order makes comprehensive changes to the Lifeline Program and eliminates funding for Link-Up in non-tribal areas.  The Order establishes a uniform, interim Lifeline support amount of $9.25.  It also requires all states to utilize, at a minimum, the income and program eligibility criteria currently utilized in federal default states for initial and continuing eligibility.  ETCs will not be able to seek reimbursement unless it receives a certification of eligibility from the prospective Lifeline subscribers.  Annually, ETCs will be required to conduct recertifications of their entire customer base on a rolling basis throughout the year by either (1) querying the appropriate eligibility or income databases (to be established), or (2) obtaining a signed certificate from the subscriber.

The revised rules will become effective April 1, 2012 with additional deadlines throughout the upcoming year as outlined below.  As more information becomes available, MTA will provide further updates.

March 2012

• Last month ETCs may claim support for non-tribal Link-Up support on Form 497

April 1, 2012

• Link-Up support is eliminated.
  • Action Item:  Tariff Updates
  • Action Item:  Billing Changes

April 2, 2012

• Flat-rate support of $9.25 for Lifeline becomes effective for non-tribal customers.  Discount applies to SLC first, then intrastate charges. Tribal discount for Lifeline is $25.00 is maintained for ETCs currently receiving high cost support; $1 minimum charge is eliminated.
  • Action Item:  Tariff Updates
  • Action Item:  Billing Changes
  • Action Item:  Customer Notice.  Lifeline credit amount is being reduced, which results in a cost increase for the customer.
  • Note:  TAP credits (and surcharges) remain unchanged at this time.
• Toll-blocking and toll control support begin phase out over 3 years.  No support beginning April 2012 for customers that have a Lifeline calling plan that includes a set number of calling minutes.
  • Action Item:  Reimbursement limited to $3 per month until 12/31/12.

June 1, 2012

• Order requires ETCs to obtain eligibility proof from customers.  Customers no longer able to self-certify.  Lifeline support limited to one per household.  MTA anticipates working with the Minnesota Public Utilities Commission and Minnesota Department of Commerce on the policy, process and procedures related to this change.
  • Action Item:  ETCs are required to establish and document policies and procedures for the review of documentation provided as proof of program-based or income-based eligibility.
  • Action Item:  ETCs must also have process in place for keeping accurate records detailing how the customer demonstrated his or her eligibility.
  • Action Item:  ETCs required to communicate new certification processes to customers.
  • Note:  MN DoC,  MN PUC , and MTA will need to determine if existing Lifeline application and verification forms will continue to be used, and if so, what changes are needed. Regardless of whether the forms are updated, companies are now required to collect SSN and date of birth from all Lifeline applicants/customers.
• Form 497 transition from reporting payments based on projected Lifeline subscriber counts to actual Lifeline subscriber counts.
  • Action Item:  ETCS must notify USAC which study area codes to transition from projected to actual claims during each month.
• Deadline for ETCs to notify USAC of which study area codes to transition from projected to actual Lifeline customer counts for each month on Form 497.
• ETCs must recertify all of their Lifeline subscribers as of June 1, 2012
  • Action Item:  Complete recertification of all Lifeline customers as of June 1, 2012 by December 31, 2012
  • Action Item:  Report recertification results to FCC, USAC, MN PUC and tribal government by Jan. 31, 2013.

July 1, 2012

• Form 497 reporting due.  USAC begins implementation of transition of payments based on actual Lifeline subscribers.  Implementation date for one year rolling deadline for ETCs to submit claims, shortened from 15 months.

October 2, 2012

• Deadline to update Lifeline outreach and marketing materials to incorporate changes in the Order related to eligibility, required documentation, limitation of the program, penalties, etc.
  • Action Item:  ETCs should review and update all print, audio, video and Internet marketing materials (e.g., brochures, pamphlets, bill inserts, websites, directories, newspaper ads, radio/television ads, etc.)