§  54.630   Election to offset support against annual universal service fund
contribution.

   (a) A service provider that contributes to the universal service
   support mechanisms under this subpart and subpart H of this part to
   eligible health care providers may, at the election of the contributor:

   (1) Treat the amount eligible for support under this subpart as an
   offset against the contributor's universal service support obligation
   for the year in which the costs for providing eligible services were
   incurred; or

   (2) Receive direct reimbursement from the Administrator for that
   amount.

   (b) Service providers that are contributors shall elect in January of
   each year the method by which they will be reimbursed and shall remain
   subject to that method for the duration of the calendar year. Any
   support amount that is owed a service provider that fails to remit its
   monthly universal service contribution obligation shall first be
   applied as an offset to that contributor's contribution obligation.
   Such a service provider shall remain subject to the offsetting method
   for the remainder of the calendar year in which it failed to remit its
   monthly universal service obligation. A service provider that continues
   to be in arrears on its universal service contribution obligations at
   the end of a calendar year shall remain subject to the offsetting
   method for the next calendar year.

   (c) If a service provider providing services eligible for support under
   this subpart elects to treat that support amount as an offset against
   its universal service contribution obligation and the total amount of
   support owed exceeds its universal service obligation, calculated on an
   annual basis, the service provider shall receive a direct reimbursement
   in the amount of the difference. Any such reimbursement due a service
   provider shall be provided by the Administrator no later than the end
   of the first quarter of the calendar year following the year in which
   the costs were incurred and the offset against the contributor's
   universal service obligation was applied.