Sec.  54.709   Computations of required contributions to universal service support
mechanisms.

   (a) Prior to April 1, 2003, contributions to the universal service support
   mechanisms shall be based on contributors' end-user telecommunications
   revenues and on a contribution factor determined quarterly by the
   Commission. Contributions to the mechanisms beginning April 1, 2003 shall be
   based on contributors' projected collected end-user telecommunications
   revenues, and on a contribution factor determined quarterly by the
   Commission.

   (1) For funding the federal universal service support mechanisms prior to
   April 1, 2003, the subject revenues will be contributors' interstate and
   international revenues derived from domestic end users for
   telecommunications or telecommunications services, net of prior period
   actual contributions. Beginning April 1, 2003, the subject revenues will be
   contributors' projected collected interstate and international revenues
   derived from domestic end users for telecommunications or telecommunications
   services, net of projected contributions.

   (2) Prior to April 1, 2003, the quarterly universal service contribution
   factor shall be determined by the Commission based on the ratio of total
   projected quarterly expenses of the universal service support mechanisms to
   the total end-user interstate and international telecommunications revenues,
   net of prior period actual contributions. Beginning April 1, 2003, the
   quarterly universal service contribution factor shall be determined by the
   Commission based on the ratio of total projected quarterly expenses of the
   universal service support mechanisms to the total projected collected
   end-user interstate and international telecommunications revenues, net of
   projected contributions. The Commission shall approve the Administrator's
   quarterly projected costs of the universal service support mechanisms,
   taking into account demand for support and administrative expenses. The
   total subject revenues shall be compiled by the Administrator based on
   information contained in the Telecommunications Reporting Worksheets
   described in  Sec. 54.711(a).

   (3) Total projected expenses for the federal universal service support
   mechanisms for each quarter must be approved by the Commission before they
   are used to calculate the quarterly contribution factor and individual
   contributions. For each quarter, the Administrator must submit its
   projections of demand for the federal universal service support mechanisms
   for high-cost areas, low-income consumers, schools and libraries, and rural
   health care providers, respectively, and the basis for those projections, to
   the Commission and the Wireline Competition Bureau at least sixty (60)
   calendar days prior to the start of that quarter. For each quarter, the
   Administrator must submit its projections of administrative expenses for the
   high-cost mechanism, the low-income mechanism, the schools and libraries
   mechanism and the rural health care mechanism and the basis for those
   projections to the Commission and the Wireline Competition Bureau at least
   sixty (60) calendar days prior to the start of that quarter. Based on data
   submitted to the Administrator on the Telecommunications Reporting
   Worksheets, the Administrator must submit the total contribution base to the
   Wireline Competition Bureau at least thirty (30) days before the start of
   each quarter. The projections of demand and administrative expenses and the
   contribution factor shall be announced by the Commission in a public notice
   and shall be made available on the Commission's website. The Commission
   reserves the right to set projections of demand and administrative expenses
   at amounts that the Commission determines will serve the public interest at
   any time within the fourteen-day period following release of the
   Commission's public notice. If the Commission take no action within fourteen
   (14) days of the date of release of the public notice announcing the
   projections of demand and administrative expenses, the projections of demand
   and administrative expenses, and the contribution factor shall be deemed
   approved by the Commission. Except as provided in  Sec. 54.706(c), the
   Administrator shall apply the quarterly contribution factor, once approved
   by the Commission, to contributor's interstate and international end-user
   telecommunications revenues to calculate the amount of individual
   contributions.

   (b) If the contributions received by the Administrator in a quarter exceed
   the amount of universal service support program contributions and
   administrative costs for that quarter, the excess payments will be carried
   forward to the following quarter. The contribution factors for the following
   quarter will take into consideration the projected costs of the support
   mechanisms for that quarter and the excess contributions carried over from
   the previous quarter.

   (c) If the contributions received by the Administrator in a quarter are
   inadequate to meet the amount of universal service support program payments
   and administrative costs for that quarter, the Administrator shall request
   authority from the Commission to borrow funds commercially, with such debt
   secured by future contributions. Subsequent contribution factors will take
   into consideration the projected costs of the support mechanisms and the
   additional costs associated with borrowing funds.

   (d) If a contributor fails to file a Telecommunications Reporting Worksheet
   by the date on which it is due, the Administrator shall bill that
   contributor based on whatever relevant data the Administrator has available,
   including, but not limited to, the number of lines presubscribed to the
   contributor and data from previous years, taking into consideration any
   estimated changes in such data.

   [ 62 FR 41305 , Aug. 1, 1997, as amended at  62 FR 65038 , Dec. 10, 1997;  63 FR 2132 , Jan. 13, 1998;  63 FR 43098 , Aug. 12, 1998;  63 FR 70576 , Dec. 21, 1998;
    64 FR 41331 , July 30, 1999;  64 FR 60358 , Nov. 5, 1999;  66 FR 16151 , Mar. 23,
   2001;  67 FR 11260 , Mar. 13, 2002;  67 FR 13227 , Mar. 21, 2002;  67 FR 79533 ,
   Dec. 30, 2002;  68 FR 38642 , June 30, 2003]