A Webinar March

Transcription

1 A Webinar March 2012

2 Topics What is New for 2012 Completing the 2012 FCC Form 499-A A/Q True Up Navigating E-File

3 What is New For 2012

4 Non-Interconnected VoIP For Purposes of TRS Contribution Purposes All providers of non-interconnected VoIP service (as defined in section (a) of the Commission s rules) with interstate end-user revenues subject to TRS contributions must file this Worksheet in order to register with the Commission and report their revenues for purposes of calculating TRS contributions. See the instructions on page 3, See also FCC Order Non-Interconnected VoIP Provider. Provides non-interconnected VoIP service, which is a service that (i) enables real-time voice communications that originate from or terminate to the user s location using Internet protocol or any successor protocol and (ii) requires Internet protocol compatible customer premises equipment, but (iii) is not an interconnected VoIP service. See the instructions at Appendix B. NOTE: Interconnected VoIP Provider. Provides interconnected VoIP service, which is a service that (1) enables real-time, two-way voice communications; (2) requires a broadband connection from the user s location; (3) requires Internet protocol compatible customer premises equipment (CPE); and (4) permits users generally to receive calls that originate on the public switched telephone network and to terminate calls to the public switched telephone network. See the instructions at Appendix B. 4

5 Non-Interconnected VoIP For Purposes of TRS Contribution Purposes Types of Non-Interconnected VoIP Providers Providers that offer non-interconnected VoIP services on a stand-alone basis for a fee. Certain other providers of other (non-voip) services that generate end-user revenues and integrate non-interconnected VoIP service into their other (non-voip) services to contribute to the TRS Fund. For TRS purposes, providers of non-interconnected VoIP services that are offered with other (non-voip) services that generate end-user revenues [are required] to allocate a portion of those end-user revenues to the non-interconnected VoIP service in two circumstances: (1) when those providers also offer the non-interconnected VoIP service on a stand-alone basis for a fee; or (2) when those providers also offer the other (non-voip) services without the non-interconnected VoIP service feature at a different (discounted) price. Instructions pg 20, footnote 44. For example, were a provider to offer a video gaming service with an integrated non-interconnected VoIP service for $20 per month, and also offer the non-interconnected VoIP service separately for $5 per month, the provider would be obligated to attribute $5 per month to the noninterconnected VoIP component for purposes of making TRS contributions. Alternatively, if a provider were to offer a video gaming service with a non-interconnected VoIP service component for $20 per month and without that component for $15 per month, $5 per month would be attributed to the non-interconnected VoIP service component. FCC Order FCC footnote 40Nothing in this Report and Order disturbs or calls into question the validity of apportioning assessable revenues from bundled services offerings for purposes of Universal Service Fund ( USF ) contributions, as currently allowed under the CPE Bundling Order. See Policy And Rules Concerning The Interstate, Interexchange Marketplace/Implementation Of Section 254(G) Of The Communications Act Of 1934, As Amended/In 1998 Biennial Review -- Review Of Customer Premises Equipment And Enhanced Services Unbundling Rules In the Interexchange, Exchange Access and Local Exchange Markets, Report and Order, 16 FCC Rcd 7418, , (2001) ( CPE Bundling Order ). 5

6 Non-Interconnected VoIP For Purposes of TRS Contribution Purposes Types of Non-Interconnected VoIP Providers cont. For example, were a provider to offer a video gaming service with an integrated noninterconnected VoIP service for $20 per month, and also offer the non-interconnected VoIP service separately for $5 per month, the provider would be obligated to attribute $5 per month to the non-interconnected VoIP component for purposes of making TRS contributions. Alternatively, if a provider were to offer a video gaming service with a non-interconnected VoIP service component for $20 per month and without that component for $15 per month, $5 per month would be attributed to the non-interconnected VoIP service component. Nothing in this Report and Order disturbs or calls into question the validity of apportioning assessable revenues from bundled services offerings for purposes of Universal Service Fund ( USF ) contributions, as currently allowed under the CPE Bundling Order. See Policy And Rules Concerning The Interstate, Interexchange Marketplace/Implementation Of Section 254(G) Of The Communications Act Of 1934, As Amended/In 1998 Biennial Review -- Review Of Customer Premises Equipment And Enhanced Services Unbundling Rules In the Interexchange, Exchange Access and Local Exchange Markets, Report and Order, 16 FCC Rcd 7418, , (2001) ( CPE Bundling Order ). See the FCC Order , Footnote 40. 6

7 Non-Interconnected VoIP For Purposes of TRS Contribution Purposes Reporting Revenues, See the instructions on page 20 Line Revenues from non-interconnected VoIP services sold to end users that are not otherwise includable on Lines 403 to 417. Only include revenues from October 1, 2011 through December 31, 2011; report revenues from January 1, 2011 through September 30, 2011 on Line Allocating Revenues between the Jurisdictions, See the instructions on pages Actuals Traffic Studies - Non-interconnected VoIP providers may rely on traffic studies if they are unable to determine their actual interstate and international revenues. Safe Harbor % of interconnected VoIP and non-interconnected VoIP telecommunications revenues 7

8 TRS Lines Instructions pg. 27 Line 512 Gross TRS Contribution Base (calculated field) The totals on this line represent gross end-user revenues for the purpose of determining contributions to TRS. TRS contribution base revenues reportable on Line 512(a) should equal the subtotal of: Line 420(a) + Line 412(a) + Line 418.4(a) - Line 511(a). TRS contribution base revenues reportable on Line 512(b) should equal the subtotal of: Line 420(d) + Line 420(e) + Line 412(e) + Line 418.4(d) + Line 418(e) Line 511(b) 8

9 TRS Lines Instructions pg. 27 Line 513 Uncollectible revenue/bad debt expense associated with TRS contribution base amounts shown on Line 512 Line 513. Show the portion of the uncollectible revenue/bad debt expense reported on Line 421 that is associated with just the TRS contribution base amounts reported on Line 512. Filers that maintain separate detail of uncollectibles by type of business should rely on those records in determining the portion of gross uncollectibles reported on Line 421 that should be reported on Line 513. Filers that do not have such detail should make such assignments in proportion to reported gross revenues. Filers must be able to document how the amounts reported on Line 513 relate to the uncollectible revenue/bad debt expense associated with gross billed revenues reported on Line 421. Line 514 Net TRS contribution base revenues (calculated field) Line 514. Net TRS contribution base revenues should equal the amounts reported on Line 512 less the amounts reported on Line 513. NOTE: TRS will use the Net TRS Contribution Base Revenues on Line 514(b) to calculate its filer contributions. See the instructions on page 31. 9

10 Completing the 2012 FCC Form 499-A

11 Who must file the 499-A? Instructions pg 2-3 ALL intrastate, interstate and international providers of telecommunications within the United States, with very limited exceptions, must file the FCC Form 499A. Telecommunications as defined by the FCC for purposes of the FCC Form 499-A is the transmission, between or among points specified by the user, of information of the user s choosing, without change in the form or content of the information as sent and received. NOTE: It is important to understand the overall customer of the service and what type of service they are using. If the overall use of a product is defined as telecommunications then all of the components of that product are telecommunications. 11

12 Who is exempt from direct contributions to USF? Instructions pg. 4-6 Government, broadcasters, schools and libraries Government entities that purchase telecommunications services in bulk on behalf of themselves (e.g., state networks for schools and libraries) are not required to file or contribute directly to universal service. System Integrators and Self Providers System integrators that derive less than 5% of their system integration revenues from the resale of telecommunications are not required to file. Entities that provide services only to themselves or to commonly-owned affiliates need not file. De Minimis companies must file! All interconnected VoIP and all telecom carriers are not required to contribute directly to the universal service support mechanisms for a given year if their contribution for that year is less than $10,000, however they must file the 499-A regardless. NOTE: For USF-purposes, non-contributors must be treated as end users by their underlying carriers and therefore may end up contributing indirectly as a result of USF passthrough surcharges. 12

13 Who is exempt from contributing to USF Customers who are USF Exempt Lifeline Customers Companies cannot collect USF fees from a Lifeline program participant on any services supported by universal service. ( Military Deployed Outside the US Companies cannot charge Universal Service fees and TRS fees to calls placed by Armed Forces personnel stationed or deployed outside the United States to their families or friends at home. (In the Matter of Implementation of Call Home Act of 2006, WC Docket 07-2, Order, FCC 07-2, 22 FCC Rcd 1020 (2007). All other US customers may be subject to USF directly or indirectly by way of pass-through surcharges from their carrier. 13

14 Reporting after a Sale or Merger Instructions pg. 13 If the operations of an entity ceased during the previous calendar year and are now part of a successor, the successor must include the previous calendar year revenues of the now defunct entity with its own worksheet. The only exception is if it is specifically written into the sales agreement that each company will be responsible for filing its own 499A. USAC will use the combined 499Q revenues of both companies when calculating the purchasing company s 499A True Up. 14

15 Record Keeping Instructions pg 8 Filers shall maintain records and documentation to justify information reporting on the Worksheet, including the methodology used to determine projections and to allocate interstate revenues, for five years. Additionally, filers must make available all documents and records that pertain to them, including those of contractors and consultants working on their behalf, to the Commission s Office of Inspector General, to the Universal Service Administrative Company (USAC), and to auditors upon request. Review by the Commission or USAC may cover any existing corporate records, not just those specifically maintained for these purposes. Entities acquiring carrier operations through consolidation, merger, etc., must maintain the records of the acquired entity. 15

16 499-A, Block 1: Key Fields Instructions pg. 9 Line 101 Filer ID Enter the Filer 499 ID number for the filer, which is assigned by USAC after a company files its first FCC Form 499-A. This code should be entered at the top of each page on the paper version of the Worksheet, the cover letter, and on any supporting documentation. Filer 499 ID numbers can be found at: FCC Form 499 Filer Database ( Telecommunications Provider Locator ( First time filers should write New in the block. New filers will be assigned a Filer 499 ID number after submitting a completed Worksheet. Line Employer Identification Number (EIN) Enter the Internal Revenue Service (IRS) employer identification number (EIN) for the filer, which should be the same EIN that the company uses to file any federal taxes, if the filer offers services subject to such taxes. The EIN is the entity s taxpayer identification number (TIN) or an individual s social security number (SSN). Consolidated filers must provide the EIN of the holding company. 16

17 499-A, Block 1: Key Fields Instructions pg 10 & Appendix B Line Communication business (CXR Type) Must rank (up to five) communications business types. At least one CXR Type must be selected. CAP/CLEC (Competitive Access Provider/Competitive Local Exchange Carrier). Competes with incumbent local exchange carriers (ILECs) to provide local exchange services, or telecommunications services that link customers with interexchange facilities, local exchange networks, or other customers, other than Coaxial Cable providers. Common Reporting Lines 304.1, 404.1, 404.2, 404.3, 405, & 406 Cellular/PCS/SMR (Cellular, Personal Communications Service, and Specialized Mobile Radio). Specialized Mobile Radio - telephone service provider) -- primarily provides wireless telecommunications services (wireless telephony). This category includes all providers of real-time two-way switched voice services that interconnect with the public switched network, including providers of prepaid phones and public coast stations interconnected with the public switched network. This category includes the provision of wireless telephony by resale. An SMR provider would select this category if it primarily provides wireless telephony rather than dispatch or other mobile services. Common Reporting Lines 309, 409, 410 &

18 499-A, Block 1: Key Fields Instructions pg 10 & Appendix B Coaxial Cable. Uses coaxial cable (cable TV) facilities to provide local exchange services or telecommunications services that link customers with interexchange facilities, local exchange networks, or other customers. Common Reporting Lines 304.1, 404, & 405 ILEC (Incumbent Local Exchange Carrier). Provides local exchange service. An incumbent LEC or ILEC generally is a carrier that was at one time franchised as a monopoly service provider or has since been found to be an incumbent LEC. See 47 U.S.C. 251(h). Common Reporting Lines 304.1, 404.1, 404.2, 404.3, 405, & 406 IXC (Interexchange Carrier). Provides long distance telecommunications services substantially through switches or circuits that it owns or leases. Common Reporting Lines 311, 312, 414.1, & 415 Interconnected VoIP Provider. Provides interconnected VoIP service, which is a service that (1) enables real-time, two-way voice communications; (2) requires a broadband connection from the user s location; (3) requires Internet protocol-compatible customer premises equipment (CPE); and (4) permits users generally to receive calls that originate on the public switched telephone network and to terminate calls to the public switched telephone network. Common Reporting Lines 304.1, 404.4, 404.5, &

19 499-A, Block 1: Key Fields Instructions pg 10 & Appendix B Local Reseller. provides local exchange or fixed telecommunications services by reselling services of other carriers. Common Reporting Lines 404.1, 404.2, 404.3, 405, & 406 Non-Interconnected VoIP Provider. Provides non-interconnected VoIP service, which is a service that (i) enables real-time voice communications that originate from or terminate to the user s location using Internet protocol or any successor protocol and (ii) requires Internet protocol compatible customer premises equipment, but (iii) is not an interconnected VoIP service. Common Reporting Lines Operator Service Provider (OSP). serves customers needing the assistance of an operator to complete calls, or needing alternate billing arrangements such as collect calling. Common Reporting Line 413 Paging and Messaging. provides wireless paging or wireless messaging services. This category includes the provision of paging and messaging services by resale. Common Reporting Line 409 Payphone Service Provider. provides customers access to telephone networks through payphone equipment, special teleconference rooms, etc. Payphone service providers also are referred to as payphone aggregators. Common Reporting Lines 306, &

20 499-A, Block 1: Key Fields Instructions pg 10 & Appendix B Prepaid Calling Card Provider. Provides prepaid calling card services by selling prepaid calling cards to the public, to distributors or to retailers. Prepaid card providers provide consumers the ability to place long distance calls without presubscribing to an interexchange carrier or using a credit card. Prepaid card providers typically resell the toll service of other carriers and determine the price of the service by setting the price of the card, assigning personal identification numbers (PINs) and controlling the number of minutes that the card can be used for. Companies who simply sell cards created by others are marketing agents and do not file. Common Reporting Line 411 Private Service Provider. Offers telecommunications to others for a fee on a non-common carrier basis. This would include a company that offers excess capacity on a private system that it uses primarily for internal purposes. This category does not include SMR or Satellite Service Providers. Common Reporting Lines 305, 312, 406, & 415 Satellite Service Provider. Provides satellite space segment or earth stations that are used for telecommunications service. Common Reporting Lines 313 &

21 499-A, Block 1: Key Fields Instructions pg 10 & Appendix B Shared-Tenant Service Provider /Building LEC. Manages or owns a multi-tenant location that provides telecommunications services or facilities to the tenants for a fee. Common Reporting Lines 404.1, 404.2, 404.3, 405, & 406 SMR (dispatch) (Specialized Mobile Radio Service Provider). Primarily provides dispatch services and mobile services other than wireless telephony. While dispatch services may include interconnection with the public switched network, this category does not include carriers that primarily offer wireless telephony. This category includes LTR dispatch or community repeater systems. Common Reporting Line 409 Stand-Alone Audio Bridging Provider /Integrated Teleconferencing Service Provider. Allows end users to transmit a call (using telephone lines), to a point specified by the user (the conference bridge), without change in the form or content of the information as sent and received (voice transmission). Common Reporting Line

22 499-A, Block 1: Key Fields Instructions pg 10 & Appendix B Toll Reseller. Provides long distance telecommunications services primarily by reselling the long distance telecommunications services of other carriers. Common Reporting Lines & 415 Wireless Data. Provides mobile or fixed wireless data services using wireless technology. This category includes the provision of wireless data services by resale. Common Reporting Lines 305, 312, 406, &

23 499-A, Block 1: Key Fields Instructions pg 10 Line FCC Registration Number (FRN), also known as CORES ID The FRN is a ten-digit number that includes a check-digit and is used to identify an entity within all Commission Licensing/Filing systems and the Commission s Revenue Accounting Management Information System (RAMIS). The number is assigned by the Commission Registration System (CORES). For more information, see ALL FILERS MUST LIST THEIR FRNs ON THE FORM!!! 23

24 499-A, Block 2-A: Key Fields Instructions pages Lines List person who completed this worksheet First and Last name Telephone, Fax and (non generic)* Line Billing address and contact person Invoices for TRS, NANPA, LNP & USF will be sent to this address Need billing contact first and last name If a contributor wishes invoices for the various programs to be sent to different addresses or contacts, a written request is required (Alternative Billing Contact Sheet) Line address where ITSP regulatory fee bill should be sent *Upon completion of the 499 form the E-File system will automatically create an E-File user account for the preparer. USAC will only create accounts for user specific address. 24

25 499-A, Block 2-B: Key Fields Instructions pg. 11 Lines D.C. Agent For Service of Process per 47 U.S.C. 413 Every common carrier, interconnected VoIP provider, and non-interconnected VoIP provider with interstate end-user revenues subject to TRS contributions, that is subject to the Act shall designate an agent in the District of Columbia for service of process. 47 C.F.R. 413; see 47 C.F.R. 1.47(h) There are no requirements that an agent for service of process be a law firm or agency business. It can be any person that has agreed to serve as the agent. The preferred agent could, for example, be a specific individual employed by the company. NOTE: Carriers must notify the FCC within one week if their DC or alternate agent changes. 25

26 499-A, Block 3 & 4: Gross Billed Revenue Instructions pg Gross billed revenues consist of total revenues billed to customers during the filing period with no allowances for uncollectibles, settlements, or out-of-period adjustments. Revenue is reported on Lines and Companies must break out the revenue in three ways. Assign gross billed revenues to reporting categories, which includes allocating revenues from bundled services between telecommunications and nontelecommunications components. Attribute telecommunications revenues derived from sales to contributing resellers (carrier s carrier, Block 3) or from sales to end users (end user, Block 4). Apportion telecommunications revenues between the intrastate, interstate, and international jurisdictions. 26

27 499-A, Block 3 & 4: Assigning Revenues Among Reporting Categories Instructions pg. 14 The Form 499-A requires revenue categorized as fixed local, mobile, toll services, or other. If revenue category breakout cannot be determined directly from corporate books of account or subsidiary records, filers may provide on the Worksheet a good-faith estimate of the breakout. Good-faith estimates should be based on information that is current for the filing period. Later in the presentation, we will review these specific types of revenue and highlight their appropriate placement on the Form 499-A. Fixed Local Originating & Terminating Traffic Private Line Payphone Mobile Interconnected VoIP USF surcharges & support Prepaid Long Distance Non-telecommunications 27

28 499-A, Block 3 & 4: Attributing Revenues as Carrier s Carrier or End User Instructions pgs Reseller revenue is defined by the instructions as revenue from a customer that: (1) incorporates purchased telecommunications services into its own telecommunications offerings; and (2) can reasonably be expected to contribute to federal universal service support mechanisms based on revenues from such offerings when provided to end users. Each filer should have documented procedures to ensure that it reports as revenues from resellers in Block 3 only revenues from entities that reasonably would be expected to contribute to support universal service. The procedures should include: Maintaining the following information on resellers: Filer 499 ID; legal name; address; name of a contact person; phone number of the contact person Annual certification by the reseller Evidence of the filer s use of the FCC s website to validate the contributor status of the reseller. Revenue that does not qualify for this category is End User, reportable in Block 4. NOTE: If the reseller company that a wholesale company is billing qualifies for the USF de minimis exemption, the revenue received from this reseller must be treated as end-user, and be reported in Block 4 by the wholesaler. The company may also deduct this revenue from their TRS, NANPA & LNP contribution base by reporting these amounts on Line

29 499-A, Block 3 & 4: Apportioning Revenues between Interstate & International Jurisdictions Instructions pages Column (a) = Intrastate Revenue + Column (d) + Column (e) Intrastate is not explicitly reported on the 499-A Column (d) is interstate, and Column (e) is international Jurisdiction is based upon traffic or simply the originating and terminating points of the final product. If John Smith makes a phone call from Maryland to California that call and all of the component s of that call are interstate. Revenues from services offered under interstate tariffs, such as revenues from federal subscriber line charges and from federally tariffed LNP surcharges, should be identified as interstate revenues. Where possible, filers should report their amount of total revenues that are interstate and international by using information from their books of account and other internal data reporting systems. Good Faith Estimates - If interstate and international revenues cannot be determined directly from corporate books of account or subsidiary records, filers may provide on the Worksheet good-faith estimates of these figures. Most common good faith estimates are based on traffic reports. 29

30 Fixed Local Carrier s Carrier Instructions pg Wholesale Local Revenues Monthly service, local calling, connection charges and other local exchange service Local Resale includes PICC charges imposed on carriers *Do not report any revenue here if you do not have the Filer Id and a current reseller certification for your customer- See Fixed Local- End User. 30

31 Fixed Local End User Instructions pages Line 404 Monthly service, local calling including message and local toll charges, connection charges, vertical features, and other local exchange services should include the basic local service revenues except for local private line revenues, special access revenues, and revenues from providing mobile or cellular services. These lines should include charges for optional extended area service, dialing features, local directory assistance, added exchange services such as automatic number identification (ANI) or teleconferencing, LNP surcharges and connection charges. Line & Revenues from Local/Long Distance Bundle Plans. (ex. $50 for unlimited US Calling) Line Revenues from Local Only Plans. Line 405 should include charges to end users specified in access tariffs, such as tariffed subscriber line charges and PICC charges levied by a local exchange carrier on customers that are not presubscribed to an interexchange carrier (i.e., a no-pic customer). 31

32 Fixed Local Interstate Breakout Instructions pages The federal subscriber line charges (Line 405) typically represent the interstate portion of fixed local exchange service; these amounts are separate from toll revenues and correspond to the revenues received by incumbent telephone companies to recover part of the cost of networks that allow customers to originate and terminate interstate calls. Filers without subscriber line charge revenue must identify the interstate portion of fixed local exchange service revenues in column (d) of the appropriate line NOTE: There is no exception given for carriers, including Competitive Local Exchange Carriers (CLECs), to the requirement to determine and report the interstate portion of fixed local exchange service revenues. 32

33 Fixed Local Interstate Breakout Fixed Local Revenues - USAC suggests that one of the following methods could be used to determine the interstate portion of fixed local exchange service revenues: Use the Subscriber Line Charge (SLC) of the Incumbent LEC and apply it against the number of fixed local exchange lines for the given period. [1] Similar to the above but since overall prices may differ between carriers, derive an interstate percentage based on the Incumbent LEC s SLC as compared to its fixed local rate and apply it against your company s fixed local exchange revenues. Use the national average percentage of the fixed local exchange revenues from calendar year 2009 reported as interstate by the Five Holding Companies With Most End-User Revenues published in the Telecommunications Industry Revenue Report found at 2 Perform a traffic study. 1] In the Matter of Cost Review Proceeding for Residential and Single-Line Business Subscriber Line Charges (SLC) Caps, CC Dockets , 94-1, Order, FCC , 17 FCC Rcd 10868, n.8 (2002) ( Although the Commission has, in many instances chosen not to regulate the rates charged by competitive LECs, including SLCs, we note that competitive LECs may look to the SLCs assessed by incumbent LECs as a benchmark in setting their own SLCs. ). [2] An average of 16.2% was derived from the fixed local service and SLC revenues shown on Table 6 of the report as follows: ($17+$5,547)/($28,601+$5,673)=.162. Dollar amounts in Millions. 33

34 Originating & Terminating Traffic Instructions pg. 15 Line 304 should include per minute charges for originating or terminating calls, such as CABS revenue and Inter-carrier Compensation. *Do not include international settlement or settlement-like receipts or transiting fees from international toll services- Use Line 418. NOTE: Report gross revenues and do not deduct or net payments to carriers for origination or termination of traffic on their networks. 34

35 Private Line- Carrier s Carrier Instructions pages 16 & 19 Private line and special access service should include revenues from providing local services that involve dedicated circuits, private switching arrangements, digital subscriber lines, and/or predefined transmission paths. (ex. T1, Frame Relay, and Private lines) Line 305 Local Private Line Service (with both A & Z locations within the basic local service area.) Line 312 LD Private Line Service (with A & Z locations in different basic local service areas.) *Do not report any revenue here if you do not have the Filer Id and a current reseller certification for your customer- See Private Line- End User. NOTE: The revenues from special access lines bundled with and charged as part of a toll service should be reported on the appropriate toll service line. 35

36 Private Line- End User Instructions pages 16 & 19 Private line and special access service should include revenues from providing local services that involve dedicated circuits, private switching arrangements, digital subscriber lines, and/or predefined transmission paths. (ex. T1, Frame Relay, and Private lines) Line 406 Local Private Line Service (with both A & Z locations within the basic local service area.). Line 406 includes all revenue from broadband service (including the transmission component of wireline broadband Internet access service) provided on a common carrier basis. Line 415 LD Private Line Service (with A & Z locations in different basic local service areas.) NOTE: NOTE: If over 10% of the traffic carried over a private or WATS line interstate, then all the revenue for that private line must be reported as 100% interstate. The best way to determine how a private line should be treated would be through a customer certification regarding the nature of the traffic carried over the private line. (MTS and WATS Market Structure, Amendment of Part 36 of the Commission s Rules and Establishment of a Joint Board, CC Dockets Nos and , Recommended Decision and Order, 4 FCC Rcd 1352 ( 3,7) (1989). The FCC has defined internet traffic to carry more than 10% interstate. 36

37 Payphone Instructions pg. 16 Line 306 should include revenues received from carriers as payphone compensation for originating toll calls. (dial-around) Line 407 should include revenues received from customers paid directly to the payphone service provider, including all coin-in-the-box revenues. Do not deduct commission payments to premises owners. NOTE: A good way to determine the interstate revenue amount is by looking at the phone bills from your underlying carrier for your pay phones. The interstate revenue reported on line 407 typically is under 20%. 37

38 Mobile Service Instructions pages 17 & 23 Line 309 Revenues for all mobile service provided to contributing resellers, including revenues received from another carrier for roaming service provided to customers of that carrier. *Do not report any revenue here if you do not have the Filer Id and a current reseller certification for your customer- See Block 4 Lines below. Line 410 Revenues for mobile service provided to end users, including message charges, any roaming charges assessed on customers and local directory assistance charges. Line 409 Revenues for mobile service provided to end users, including monthly charges, activation fees, service restoration, and service order processing charges, etc. Itemized toll charges to mobile service customers should be included in the Lines 413 or 414, as appropriate. The FCC provides the following safe harbor percentages of interstate revenues associated with Line 309, Line 409, and Line 410: 37.1% of cellular and broadband PCS telecommunications revenues 12.0% of paging revenues 1.0% of analog SMR dispatch revenues 38

39 Interconnected VoIP Instructions pages 14-15, & 24 Line 303 Wholesale VoIP Revenues *Do not report any revenue here if you do not have the Filer Id and a current reseller certification for your customer- See Block 4 Lines below. Line Revenues from Local service provided via interconnected VoIP service offered in conjunction with a broadband connection. Line Revenues from Local service provided via interconnected VoIP service offered independent of the broadband connection. *Revenue from bundled local/long distance plans should be reported here Line Separately billed revenue for ordinary long distance provided to end users using interconnected VoIP. The FCC provides a 64.9% safe harbor percentage of interstate revenues for interconnected VoIP telecommunications associated with Line 303.2, Line 404.4, Line 404.5, and Line Interconnected VoIP providers not reporting based on the safe harbor must make a similar allocation as well as determine the appropriate portion of revenues to allocate to interstate and international toll service. 39

40 Use of Safe Harbors Instructions pages Safe harbor percentages may not be applied to universal service pass-through charges, fixed local, itemized toll charges. Wireless telecommunications providers and interconnected VoIP providers that choose to avail themselves of these safe harbor percentages for interstate revenues may assume that the FCC will not find it necessary to review or question the data underlying their reported percentages. All affiliated wireless telecommunications providers and interconnected VoIP providers must make a single election for each type of safe harbor. Annual revenues reported on the FCC Form 499-A should reflect the filer s reporting of revenues in each quarter on FCC Form 499-Q. 40

41 Universal Service Support Instructions pg. 17 Line 308 Universal service support revenues should include all amounts that filers receive as universal service support from either states or the federal government. Includes revenues received as cash or as a credit against contributions. *Do not include charges or credits for subsidized services provided to schools, libraries, and rural health care providers. Such charges are properly reported as end user revenue. 41

42 USF Surcharges Instructions pg Itemized charges levied by the reporting entity in order to recover contributions to state and federal universal service support mechanisms should be classified as end-user billed revenue. NOTE: If the surcharge reported on line 403 is to recover federal USF costs, the federal figure should be reported as either interstate or international, as appropriate. 42

43 Prepaid Calling Cards Instructions pages Line 411 Revenues from prepaid calling cards provided either to customers, distributors or to retail establishments. Prepaid card includes prepaid service where the customer utilizes the service provider s switching platform and a personal identification number (PIN) for purposes of verification and billing, even if the customer does not receive a physical card. NOTE: Gross billed revenues should represent the amounts actually paid by end user customers and not the amounts paid by distributors or retailers, and should not be reduced or adjusted for discounts provided to distributors or retail establishments. For purposes of completing this Worksheet, prepaid card revenues should be recognized when end user customers purchase the cards. The most common way is to recognize revenue when the card is activated. 43

44 Long Distance Instructions pages Line 311, Line 412, and Line 414 Filers should report ordinary long distance revenues on these lines, including revenues from most toll calls placed for a fee and flat monthly charges billed to customers, such as account maintenance charges, PICC pass-through charges, and monthly minimums. Line 311 Ordinary long distance provided to contributing resellers. *Do not report revenue here if you do not have a Filer ID and current reseller certification for your customer. See Block 4 Lines below. Line Ordinary long distance provided to end users using non-interconnected VoIP technologies, including toll service that employs Internet Protocol but that is not provided on an interconnected VoIP basis. Line Separately billed revenue for ordinary long distance provided to end users using interconnected VoIP. NOTE: Telecommunications providers should report international settlement revenues from traditional settlement transiting traffic on Line 418 of the Worksheet. 44

45 Other Long Distance Instructions pages Line 413 Operator and toll calls with alternative billing arrangements should include all calling card or credit card calls, person-to-person calls, and calls with alternative billing arrangements such as third number billing, collect calls, and country-direct type calls that either originate or terminate charges in a U.S. point. These lines should include all charges from toll or long distance directory assistance. Line 416 Satellite services should contain revenues from providing space segment service and earth station link-up capacity used for providing telecommunications or telecommunications services via satellite. Line 417 should include toll teleconferencing. The associated carrier s carrier revenue lines for this revenue category are 310, 313, and 314. *Do not report any revenue here if you do not have the Filer Id and a current reseller certification for your customer- See Block 400 Lines above. 45

46 Non-Telecommunications Instructions pg. 20 What is Non-Telecommunications Revenue? Revenues that are not derived from telecommunications (i.e. rent or sale of equipment) Revenues that are derived from telecommunications related functions, but should not be included in the universal service or other fund contribution bases A listing of non-telecommunications examples is available in the instructions. Line The new line items for the noninterconnected VOIP, this is the only 418 line items that required the interstate and international percentage 46

47 End User Summary Totals Instructions pg. 25 Line 419 Gross billed revenues from all sources [Lines 303 through 314 plus Lines 403 through 418] Line 420 Gross universal service contribution base amounts [Lines 403 through 411 plus Lines 413 through 417] NOTE: NANP, & LNP all use the gross universal service contribution base amounts reported on line 420 to calculate their filer contributions. NANP - Line 420(a) + Line 412(a) Line 511(a) LNP - (Line 420(a) + Line 412(a) Line 511(a)) * % of end-user revenues shown on Lines 503 through

48 Bad Debt Instructions pages Line 421 Show the uncollectible revenue/bad debt expense associated with gross billed revenues amounts reported on Line 419. In addition, for those using billed revenues, this line may include redeemed credits. Line 422 Show the portion of the uncollectible revenue/bad debt expense reported on Line 421 that is associated with just the universal service contribution base amounts reported on Line 420. Line 423 Net universal service contribution base revenues [Line 420 minus line 422] Filers that maintain separate detail of uncollectibles by type of business should rely on those records in determining the portion of gross uncollectibles reported on Line 421 that should be reported on Line 422. Filers that do not have such detail should make such assignments in proportion to reported gross revenues. NOTE: USAC will use the revenues on Line 423 (d+e) for the 499 A/Q True-Up 48

49 Officer Certification Instructions pg. 27 An officer of the company must certify to the accuracy of the Form 499-A reporting. The address may not be generic. USAC will establish an E-file account for the officer using the address, so that future filings may be certified online. 49

50 A/Q True Up

51 2012 A/Q True-Up Example Filings Interstate Revenue (Line 423D) International Revenue (Line 423E) Contribution Base A $2,377,064 + $19,218 = $2,396,282 Interstate Revenue (Line 120B) International Revenue (Line 120C) Contribution Base Nov Q $621,080 + $7,495 = $628,575 Feb Q $603,005 + $4,978 = $607,983 May Q $623,264 + $4,627 = $627,891 Aug Q $639,772 + $4,211 = $643, Q Contribution Base $2,487,121 + $21,311 = $2,508, Avg. Contribution & Circularity Factors Avg. of 2 highest FCC contribution Factors.1540 Avg. of 2 lowest FCC Contribution Factors.1465 Avg. of 2 FCC Circularity Factors associated with 2 high FCC Contribution Factors Avg. of 2 FCC Circularity Factors associated with 2 low FCC Contribution Factors Avg. of all FCC Contribution Factors Avg. of all FCC Circularity Factors

52 2012 A/Q True-Up Step 1 The first step in the True Up is to determine whether or not the company is de minimis for purposes of the A/Q True Up using the following formula: (499A *.15025) (499A *.15025* ) If result is < $10,000, then the contributor is de minimis, and January- December 2010 support mechanism charges will be reversed on you July 2012 invoice. If result is > or = $10,000, then the contributor is NOT de minimis; continue to step 2. Example: ($2,396,282 *.15025) ($2,396,282 * * ) = $312, $312, > $10,000 Not De Minimis 45 NOTE: In CY 2011, Interstate Revenues greater than $76,622 are not De Minimis.

53 2012 A/Q True-Up Step 2 The next step in the True Up is determining which FCC contribution factor, and associated FCC Circularity factor to use in the True Up Calculation. After determining which factor is applicable, it will be used to replace the Average FCC Contribution Factor* in step 3. Average of 2 highest FCC Contribution Factors and the associated average FCC Circularity Factor should be used if (499A) > (Q1 + Q2 + Q3 + Q4). Average of 2 lowest FCC Contribution Factors and the associated average FCC Circularity Factor should be used if (499A) < (Q1 + Q2 + Q3 + Q4). Average of all 4 FCC Contribution Factors and the associated average FCC Circularity Factor should be used if (499A) = (Q1 + Q2 + Q3 + Q4). Example: ($2,396,282) < ($628,575 + $607,983 + $627,891 + $643,983) Average of 2 lowest FCC Contribution Factors and the associated average FCC Circularity Factor should be used. 46

54 2012 A/Q True-Up Step 3 Using the inputs noted above, the A/Q True Up formula for calculating necessary Support Mechanism Credits or Adjustments is: (499A) - (Q1 + Q2 + Q3 + Q4) = True Up Base (True Up Base * Average FCC Contribution Factor) (True Up Base * Average FCC Contribution Factor * Average FCC Circularity Factor) = Quarterly Credit or Adjustment Quarterly Credit or Adjustment / 3 = Monthly Credit or Adjustment Example: ($2,396,282) - ($628,575 + $607,983 + $627,891 + $643,983) = -$112,150 (-$112,150 *.1465) - (-$112,150 *.1465 * ) = -$14,311 -$14,311 / 3 = -$4,770 The company will receive three equal credits of -$4,770 on its July September Invoices. 47

55 Navigating E-File

56 It s easy to use E-File! Start at USAC s website,. Click on the words Fund Administration, in orange. Then click on the word E-File 56

57 Forgotten your password? Not a problem! Click on the Forgot password link to get a new one. All you need is your first and last names and your User ID, which is your address. 57

58 1 After logging in: Click on Create New Form Choose 499A for April 2012 and then click on Submit 2 58

59 Hint: Depending on how your browser is set up, your new form might open in a new tab, a new window, or the same tab, so if you don t see it immediately, look for it. This form opened in a new tab 59

60 When you reach the last page, click on the Click here to Preview and Submit the form button at bottom of the screen to review your completed 2012 FCC Form 499-A filing. Click Save Form if you are not done. You may need to use the scroll bar on the right to see the buttons. 60

61 Review the form carefully! Can t find the buttons? Use the scroll bar on the far right to see the bottom of the form To make changes, click on the Edit Form button and you will go back to the input screens to make your changes If everything is correct, click on the button to the right. If you are a company officer the button will say Certify. By clicking the Certify button you are submitting and certifying that all the information is correct. Your filing is now considered received by USAC and you are finished! If you are not the company officer the button to right will say Submit. By clicking the Submit you are submitting the information to USAC, you will now need your company officer to certify that the information is correct. 61

62 When your form has been certified, your filing is complete and you will get a confirmation message. You can also print the form, sign it manually, and mail it in. 62

63 For support, or more information: USAC Customer Operations (888)