Sec.  54.715   Administrative expenses of the Administrator.

   (a)  The annual administrative expenses of the Administrator should be
   commensurate with the administrative expenses of programs of similar size,
   with the exception of the salary levels for officers and employees of the
   Administrator  described  in paragraph (b) of this section. The annual
   administrative expenses may include, but are not limited to, salaries of
   officers and operations personnel, the costs of borrowing funds, equipment
   costs, operating expenses, directors' expenses, and costs associated with
   auditing contributors of support recipients.

   (b) All officers and employees of the Administrator may be compensated at an
   annual rate of pay, including any non-regular payments, bonuses, or other
   compensation, in an amount not to exceed the rate of basic pay in effect for
   Level I of the Executive Schedule under 5 U.S.C. 5312.

   Note to paragraph(b): The compensation to be included when calculating
   whether an employee's rate of pay exceeds Level I of the Executive Schedule
   does not include life insurance benefits, retirement benefits (including
   payments to 401(k) plans), health insurance benefits, or other similar
   benefits, provided that any such benefits are reasonably comparable to
   benefits that are provided to employees of the federal government.

   (c) The Administrator shall submit to the Commission projected quarterly
   budgets at least sixty (60) days prior to the start of every quarter. The
   Commission  must  approve  the  projected quarterly budgets before the
   Administrator disburses funds under the federal universal service support
   mechanisms. The administrative expenses incurred by the Administrator in
   connection with the schools and libraries support mechanism, the rural
   health care support mechanism, the high cost support mechanism, the low
   income support mechanism, the interstate access universal service support
   mechanism,  and  the interstate common line support mechanism shall be
   deducted from the annual funding of each respective support mechanism. The
   expenses deducted from the annual funding for each support mechanism also
   shall include the Administrator's joint and common costs allocated to each
   support  mechanism pursuant to the cost allocation manual filed by the
   Administrator under  Sec. 64.903 of this chapter.

   [ 63 FR 70576 , Dec. 21, 1998, as amended at  65 FR 38690 , June 21, 2000;  65 FR 57739 , Sept. 26, 2000;  66 FR 59728 , Nov. 30, 2001;  69 FR 5719 , Feb. 6, 2004]