Telephone Consumer Protection Act of 1991, 80594-80608 [2016-24745]

Agencies

• FEDERAL COMMUNICATIONS COMMISSION

[Federal Register Volume 81, Number 221 (Wednesday, November 16, 2016)]
[Rules and Regulations]
[Pages 80594-80608]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-24745]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 64

[CG Docket No. 02-278; FCC 16-99]


Telephone Consumer Protection Act of 1991

AGENCY: Federal Communications Commission.

ACTION: Final rule.

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SUMMARY: In this document, the Commission modifies its rules under the 
Telephone Consumer Protection Act (TCPA) to implement a provision of 
the Bipartisan Budget Act of 2015 that excepts from the TCPA's prior-
express-consent requirement autodialed and prerecorded calls ``made 
solely to collect a debt owed to or guaranteed by the United States.'' 
While certain debt servicing calls are permitted under the

[[Page 80595]]

exception, the Commission caps the number of permitted calls to 
wireless numbers at no more than three within a thirty-day period; 
ensures that consumers have the right to stop such calls at any time; 
and adopts other consumer protections. These measures implement 
Congress's mandate to ensure the TCPA does not thwart important calls 
that can help consumers avoid debt troubles while preserving consumers' 
ultimate right to determine what calls they wish to receive.

DATES: This Order was issued August 11, 2016.

FOR FURTHER INFORMATION CONTACT: Kristi Thornton, Consumer Policy 
Division, Consumer and Governmental Affairs Bureau, at (202) 418-2467 
or email: Kristi.Thornton@fcc.gov.

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Rules 
and Regulations Implementing the Telephone Consumer Protection Act of 
1991, Report and Order, document FCC 16-99, adopted on August 2, 2016, 
and released on August 11, 2016, in CG Docket No. 02-278. The full text 
of document FCC 16-99 will be available for public inspection and 
copying via ECFS, and during regular business hours at the FCC 
Reference Information Center, Portals II, 445 12th Street SW., Room CY-
A257, Washington, DC 20554. To request materials in accessible formats 
for people with disabilities (Braille, large print, electronic files, 
audio format), send an email to fcc504@fcc.gov or call the Consumer and 
Governmental Affairs Bureau at (202) 418-0530 (voice), (844) 432-2272 
(videophone), or (202) 418-0432 (TTY).

Synopsis

    1. The Commission adopts rules to implement the Budget Act's 
amendments to the TCPA, including--based on substantial record support, 
and in furtherance of the TCPA's consumer-protection goals--
restrictions on the number and duration of calls that may be made 
pursuant to the amendments. Among other things, the Commission 
determines who may make covered calls, limits the number of federal 
debt collection calls that may be made, and determines who may be 
called. The Commission also creates rules to, among other things:
     Permit calls made by debt collectors when the loan is in 
delinquency, and by debt servicers following a specific, time-sensitive 
event affecting the amount or timing of payment due, and in the 30 days 
before such an event.
     Determine that consumers have a right to stop the 
autodialed, artificial-voice, and prerecorded-voice servicing and 
collection calls regarding a federal debt to wireless numbers at any 
point the consumer wishes.
     Specify that covered calls may be made by the owner of the 
debt or its contractor, to: (1) The wireless telephone number the 
debtor provided at the time the debt was incurred; (2) a phone number 
subsequently provided by the debtor to the owner of the debt or its 
contractor; and (3) a wireless telephone number the owner of the debt 
or its contractor has obtained from an independent source, provided 
that the number actually is the debtor's telephone number.
    2. Once information collection requirements of the revised Sec.  
64.1200(j)(3), (j)(4) have been approved by the Office of Management 
and Budget (OMB), the Commission will publish a document in the Federal 
Register (1) revising Sec. Sec.  64.1200(a)(1)(iii); (a)(3)(iv), (v), 
and (vi); (f)(17); (i); and (j); and (2) announcing the effective date 
of these revisions to be set at 60 days after publication of that 
document in the Federal Register.

Covered Calls

    3. ``Solely to Collect a Debt.'' The Budget Act excepts covered 
calls from the prior-express-consent requirement when they are ``solely 
to collect a debt owed to or guaranteed by the United States.'' The 
Commission begins by interpreting the statutory phrase ``solely to 
collect a debt'' so as to determine whether calls are covered. Because 
the statutory term ``solely to collect a debt'' is ambiguous, the 
Commission has discretion to reasonably interpret that phrase.
    4. The Commission rejects a subjective standard of what a caller 
may intend when determining whether a call is a covered call and 
instead looks to objective characteristics of the call. The Commission 
notes that an objective standard is consistent with its approach to 
other aspects of the TCPA, such as the meaning of ``called party'' for 
purposes of reassigned wireless numbers. Furthermore, a subjective 
standard would be difficult to administer, while an objective standard 
enables the Commission to look at actual, measurable characteristics of 
a call.
    5. In the 2016 NPRM, the Commission asked whether covered calls 
should begin at delinquency or default. Several commenters support the 
proposal that covered calls begin at delinquency, stating that calls 
during delinquency can assist a debtor in determining whether 
alternative payment plans are an option. The FTC staff's comments, 
however, promote default as the starting point for covered calls. They 
argue that the FDCPA uses default as the ``touchstone for coverage,'' 
and that those collecting debts that were not in default when their 
agency obtained them are not considered debt collectors under the act. 
Because the amended TCPA is not limited to third-party debt collectors, 
however, this distinction is less important and the reasoning for using 
default rather than delinquency as an initiating event is likewise less 
persuasive.
    6. The Commission interprets ``solely to collect a debt,'' and, 
therefore, calls made pursuant to the exception created in the Budget 
Act, to be limited to debts that are delinquent at the time the call is 
made or to debts that are at imminent risk of delinquency as a result 
of the terms or operation of the loan program itself. As a practical 
matter, this means that, at the time the call is made, the debt is 
delinquent or there is an imminent, non-speculative risk of delinquency 
due to a specific, time-sensitive event that affects the amount or 
timing of payments due, such as a deadline to recertify eligibility for 
an alternative repayment plan or the end of a deferment period. Many 
federal loan programs offer various alternate and income-based 
repayment options for which a debtor might qualify at various times 
during the life of the debt, and the amount or timing of payments due 
can vary significantly following expiration of a deferral period or an 
alternate payment plan. For example, some income-based repayment plans 
for student loans allow a debtor to make a monthly payment of zero 
dollars without being considered delinquent or in default, but higher 
monthly payments are required automatically if the debtor does not 
periodically recertify that he continues to qualify for the program. As 
such, calls regarding changes in the amount or timing of payments are 
directly related to the collection of the underlying debt in that they 
can ensure payments that would likely otherwise would not be made.
    7. Some commenters argue that the Commission may not limit covered 
calls to those that are ``delinquent'' or in ``default'' because the 
Budget Act did not include such limiting language. For example, ACA 
states: ``Congress made absolutely no mention of the [exception] being 
limited to calls made post delinquency or post-default. As a result it 
would be inappropriate for the Commission to read such a limitation 
into the amendment.'' The Commission disagrees with regard to its 
discretion to interpret the statutory language, but notes that it is 
not limiting covered calls

[[Page 80596]]

only to those made after default or delinquency. As commenters note, 
the Supreme Court has confirmed that a person or entity ``collects'' a 
debt by attempting to obtain payment on it. Thus, the Commission 
believes that covered calls must have a reasonable nexus to seeking to 
obtain payment and that the calls permitted under the Commission's 
interpretation of ``solely to collect'' have such a nexus. In contrast, 
calls outside the scope of covered calls lack such a nexus because the 
risk of delinquency would be too speculative and too far removed (i.e., 
not imminent) from an event affecting the amount or timing of payments 
due.
    8. Other commenters argue that covered calls should begin before 
delinquency because calls that occur after delinquency or default are 
``too late to prevent damage to the consumer's credit profile and 
fail[] to allow the borrower to receive timely information to choose 
the repayment plan best suited for the borrower's unique 
circumstances.'' The Commission agrees. Certain calls to service a debt 
owed to or guaranteed by the government may be so closely tied to an 
imminent and non-speculative risk of delinquency as to also be ``solely 
to collect a debt.'' These calls pertain to specific, time-sensitive 
events that affect the amount or timing of payments due. Once these 
time-sensitive events are sufficiently imminent, calls about these 
events are no longer just about a debt, but are solely about the 
collection of a debt. The time-sensitive nature of these calls 
necessitates that they are ``solely to collect a debt'' for only a 
limited time--following the event and in the 30 days before such an 
event. Any earlier and the calls are too speculative and attenuated for 
the purpose of the call to be ``solely to collect a debt.''
    9. The record indicates that these debt servicing calls help a 
debtor avoid delinquency or default, which can preserve the debtor's 
payment history and credit rating, and help maintain eligibility for 
future loans. The potential value of these servicing calls to debtors 
by helping them avoid delinquency or default, and the probability that 
servicing calls will create conditions that allow debts to be more 
readily collected by the United States, lead the Commission to 
determine that certain servicing calls should be included in the 
interpretation of ``solely to collect a debt.''
    10. A caller, therefore, need not wait until a debtor is delinquent 
to begin making certain debt servicing calls. Rather a caller may make 
debt servicing calls following a specific, time-sensitive event that 
affects the amount or timing of payments due, such as a recertification 
deadline or the end of a deferment period, and in the 30 days before 
such an event. For purposes of the limits on the number of covered 
calls, no debt servicing calls will be permitted except those regarding 
an approaching deadline or a change in status (deferment, forbearance, 
rehabilitation), calls regarding enrollment or reenrollment in income-
driven or income-based repayment plans, and calls regarding similar 
time-sensitive events or deadlines affecting the amount or timing of 
payments due. While commenters list other pre-delinquency calls they 
would like the Commission to include in the list of debt servicing 
calls for purposes of the Budget Act amendments, the Commission 
declines to do so. This list of calls the Commission is permitting as 
covered debt servicing calls includes the most-requested debt servicing 
calls and includes calls both to enroll debtors in consumer-friendly 
programs and to keep them enrolled in those programs. It also includes 
calls aimed at alerting debtors when significant events will occur that 
will change their payment patterns. The list does not include calls 
regarding routine events, such as reminders about scheduled upcoming 
payments. The Commission would consider a routine event one that occurs 
by operation of the contract alone, as contrasted with the events 
described above, which require affirmative steps by the debtor to take 
advantage of the provisions of the debt contract. These included calls, 
which often increase the probability that debts will be more readily 
collected and that a debtor will avoid delinquency, achieve the desired 
result of enabling the caller to collect a debt owed to or guaranteed 
by the United States and simultaneously can benefit the debtor. The 
Commission's interpretation of covered calls permit no debt servicing 
calls unless the call follows one of these specific, time-sensitive 
events, and in the 30 days before such an event.
    11. ``Owed to or guaranteed by the United States.'' The Commission 
turns next to the types of debts that are included in the phrase ``owed 
to or guaranteed by the United States.'' The Commission determines 
that, for TCPA purposes, this phrase includes only debts for which the 
United States is currently the owner or guarantor of the debt. The 
Budget Act amendments specify that covered calls may be made regarding 
``debts owed to or guaranteed by the United States.'' Because the 
Commission lacks a developed record on the issue, it does not seek to 
define or determine with particularity exactly which debts are included 
in or excluded from this phrase; like commenter SLSA, the Commission is 
cognizant of the ``variety of types of debts covered by the 
provision,'' and while the Commission does not ``believe that the 
definitions applicable to each specific federal program should be used 
to [automatically] determine whether debt in that program is considered 
owed or guaranteed by the United States,'' the Commission views such 
definitions--and any agency or judicial interpretations of them--as 
highly relevant evidence regarding whether a debt is ``owed to or 
guaranteed by the United States.''
    12. The Commission clarifies that the debt must be currently owed 
to or guaranteed by the federal government at the time the call is 
made. Debts that have been satisfied are not among the covered debts, 
and debts that have been sold in their entirety by the federal 
government are, likewise, not covered. In these cases, the debt is no 
longer ``owed to . . . the United States.'' The Commission notes that 
basic contract principles dictate that when an owner sells an item, it 
no longer belongs to the original owner, but to the purchaser. 
Likewise, the purchaser of a debt is owed the repayment obligation, not 
the prior obligee. For example, a debt is not still ``owed to . . . the 
United States'' if the right to repayment is transferred in whole to 
anyone other than the United States, or a collection agency that has 
acquired ownership of the debt from the federal government collects the 
funds and then remits to the federal government a percentage of the 
amount collected. In such circumstances, the debt is no longer owed to 
the United States and the rules permit no calls under this exception.
    13. Who may be called? The Commission next turns to the question of 
who may be called using the exception created by the Budget Act. The 
Commission determines that, because calls made pursuant to the 
exception must be made ``solely to collect a debt,'' the covered calls 
may only be made to the debtor or another person or entity legally 
responsible for paying the debt. Calls are not permitted to other 
persons listed on the debt paperwork, such as references or witnesses, 
under FCC rules. These persons are not liable for the debt; 
consequently, calls to these persons cannot be ``solely to collect'' 
the debt. Senators and Members of Congress support the decision to 
limit covered calls in this way, writing: ``The regulations should 
limit the calls to those made just to the debtors'' and ``[r]estrict 
the calls and texts to those

[[Page 80597]]

made just to debtors--not their family or friends.'' Another Senator 
writes separately, urging: ``Calls to persons who are not the borrower 
should be eliminated.'' Consumer groups concur, stating ``the only 
reasonable way to read the phrase `solely to collect a debt' is to 
exclude all calls to persons who do not owe the debt.'' The FTC staff 
also supports this limitation, stating ``FTC staff recommends that 
covered calls be limited to calls directed at the person or persons 
obligated to pay the debt.''
    14. Other commenters, however, urge the Commission to permit 
covered calls to persons other than the debtor. Navient, in particular, 
comments on the need to call the parents, relatives, and references of 
a borrower in order to locate the borrower. Navient writes: ``[C]alling 
numbers obtained through skip tracing is sometimes the only way to 
reach a defaulted borrower.'' It also notes that the Department of 
Education requires ``lenders to contact every `endorser, relative, 
reference, individual, and entity' identified in a delinquent 
borrower's loan file as part of their due diligence efforts.'' Navient 
fails to note, however, that there is no requirement to make these 
contacts via robocall. Navient also makes clear in its comments that 
its purpose in calling relatives and references is to locate the 
debtor, not to collect the debt. Because the language of the Budget Act 
authorizes the Commission to limit calls ``solely to collect a debt,'' 
the rules permit covered calls only to persons who are responsible for 
repaying the debt.
    15. Numbers that May be Called. The Commission's interpretation of 
the phrase ``solely to collect a debt'' permits no covered calls unless 
the call is made to the debtor or person responsible for paying the 
debt at one of three categories of wireless telephone numbers. First, 
calls may be made to the wireless telephone number the debtor provided 
at the time the debt was incurred, such as on the loan application. 
Second, covered calls may be made to a wireless phone number 
subsequently provided by the debtor to the owner of the debt or the 
owner's contractor. Because the debtor has provided the phone numbers 
in these first two categories, the caller risks liability for the call 
after the first call to the number, if the number has been reassigned 
from the debtor to a third party. Third, covered calls are permitted to 
a wireless telephone number the owner of the debt or its contractor has 
obtained from an independent source, provided that the number actually 
is the debtor's telephone number. The Commission's decision to permit 
calls to these three categories of numbers is consistent with its 
interpretation of the phrase ``solely to collect a debt,'' and 
continues to satisfy the TCPA's consumer protection goals to the extent 
possible. As the connection between the phone numbers called and the 
debtor becomes more attenuated, so, too, does the likelihood of 
reaching the debtor. Beyond these three categories of numbers, persons 
reached will not likely be the debtor, so calls will not likely result 
in the collection of a debt owed to or guaranteed by the United States.
    16. The Commission notes that the rules it is adopting, which 
permit calls only if they are to these three categories of numbers, are 
broader than the proposal in the 2016 NPRM. The Commission has included 
calls to numbers subsequently provided by the debtor to the owner of 
the debt or the owner's contractor, and to numbers the owner of the 
debt or its contractor has obtained from an independent source, 
provided that any such number actually is the debtor's number. These 
additional categories of numbers should prevent uninvolved consumers 
from receiving robocalls about debts they do not owe, while mitigating 
concerns that the phone number provided on the loan application no 
longer belongs to the debtor when the debt enters repayment.
    17. This limitation the Commission is placing on the number of 
covered calls, which limits covered calls only to these three 
categories of numbers, is a determination that robocalls to wrong 
numbers are not covered by the exception created in the Budget Act 
amendments. Calls to reassigned wireless numbers may not be made 
pursuant to the exception either. Wrong numbers, as the Commission used 
the term in the 2015 Declaratory Ruling and Order, published at 80 FR 
61129, Oct. 9, 2015, are ``numbers that are misdialed or entered 
incorrectly into a dialing system, or that for any other reason result 
in the caller making a call to a number where the called party is 
different from the party the caller intended to reach or the party who 
gave consent to be called.'' The Commission determines that covered 
calls to reassigned wireless numbers, however, are subject to the one-
call window the Commission clarified in the 2015 Declaratory Ruling and 
Order. For purposes of this exception, the reassigned wireless number 
provision would come into play when the caller makes a call to the 
wireless number provided by the debtor but the number was subsequently 
reassigned. In this circumstance, the caller would be entitled to the 
one-call window the Commission previously clarified if the caller did 
not know of the reassignment.
    18. Numerous parties in the record urge the Commission to apply the 
same wrong number and reassigned number standards set forth in the 2015 
Declaratory Ruling and Order to these covered calls. Others ask the 
Commission to abandon or alter the wrong-number and reassigned-number 
standard so that covered calls are treated differently from other 
robocalls, but do not set forth a persuasive argument for why a covered 
call is different from a typical robocall subject to the one-call 
window. Several commenters argue for a ``reasonable belief'' or 
``actual knowledge'' standard. The Commission, however, rejected those 
standards in the 2015 Declaratory Ruling and Order. And while ABA/CBA 
argues that separate regulations ``mandate[] that calls be made to 
distressed borrowers at their last known phone number of record,'' it 
does not indicate that the regulations require that those calls be made 
using an autodialer, artificial voice, or prerecorded voice. 
Consequently, ABA/CBA could comply with these separate regulatory 
requirements by manually dialing the last known phone number of record.
    19. Who May Make the Calls? The Commission next considers who may 
make the covered calls at issue. The Commission finds that a call is 
made ``solely to collect a debt owed to or guaranteed by the United 
States'' only if it is made by the owner of such a debt or its 
contractor. The record supports this interpretation. A number of 
commenters urge the Commission to determine that covered calls may be 
made by ``creditors and those calling directly on their behalf,'' or 
``creditors and those calling on their behalf, including their 
agents.'' Two commenters ask the Commission to broaden the universe of 
those who may make covered calls, asking that ``subcontractors [] be 
permitted to call, even if the subcontractor is not an agent.'' The 
Commission declines to adopt rules that are as broad as 
``subcontractor,'' but limits permitted callers to the owner of the 
debt or its contractor. As the Commission has noted above, consumers 
consistently complain to the Commission, the FTC, and CFPB about 
abusive and persistent debt-collection robocalls. In creating the rules 
limiting the number of covered calls, the Commission seeks to balance 
the goals of increasing the likelihood that debts owed to or guaranteed 
by the United States will be paid by the debtor and of protecting 
consumers. These rules properly balance these goals by recognizing the 
practicality that owners

[[Page 80598]]

of debts might use the services of contractors to make covered calls in 
a manner that reduces the potential for abuse or causing debtors undue 
hardship.
    20. What Constitutes a ``Call Made''? ``Call,'' for this exception, 
is consistent with the Commission's previous interpretation of ``call'' 
for TCPA purposes. A call is any initiated call. The call need not be 
completed, and need not result in a conversation or voicemail. While 
many commenters support this interpretation of ``call,'' others argue 
that the definition for purposes of the exception created by the Budget 
Act should be ``connected calls'' or ``actual contacts.'' The 
Commission finds no statutory basis to deviate from its existing 
interpretation of ``call'' and ``made,'' and finds persuasive one 
commenter's argument that ``[e]very time the phone rings can cause 
anxiety. Whether or not the collector leaves a message on voice mail 
does not assuage this harassment.'' Consistent with the text of the 
TCPA and the Commission's previous clarifications, covered calls may be 
an autodialed call, a prerecorded- or artificial-voice call, or a text 
message sent using an autodialer.
    21. Content of the covered calls. The 2016 NPRM asked how to ensure 
that covered calls do not include extraneous material that consumers do 
not want, such as marketing content. The Commission agrees with the 
many commenters who argue that content that includes marketing, 
advertising, or selling products or services, and other irrelevant 
content is not solely for the purpose of collecting a debt owed to or 
guaranteed by the United States. The Commission has previously found 
that calls solely for the purpose of debt collection do not constitute 
telemarketing. Content in these calls that is telemarketing, therefore, 
transforms the call from one solely for the purpose of debt collection 
into a telemarketing call.

Limits on Number and Duration of Federal Debt Collection Calls

    22. Need for restrictions. In considering the need for restrictions 
on calls to collect debts owed to or guaranteed by the United States, 
the Commission notes the volume of consumer complaints, as set forth 
above. These factors, along with Congress' explicit grant of authority 
to the Commission to ``restrict or limit the number and duration of 
calls made to a telephone number assigned to a cellular telephone 
service to collect a debt owed to or guaranteed by the United States,'' 
lead the Commission to adopt certain restrictions.
    23. Scope. Section 301(a)(2) of the Budget Act, which enacts a new 
statutory provision at 47 U.S.C. 227(b)(2)(H), authorizes the 
Commission to ``restrict or limit the number and duration of calls made 
to a cellular telephone number to collect a debt owed to or guaranteed 
by the United States.'' The scope of this authority is broader than the 
scope of the exception from the prior-express-consent requirement, 
because--unlike the exception--it is not limited to calls made 
``solely'' to collect a covered debt. Thus, the rules the Commission 
promulgates under this authority apply to any autodialed, prerecorded-
voice, and artificial-voice calls that reasonably relate to the 
collection of a covered debt and therefore apply even if the calls are 
not ``calls made solely to collect a debt'' under section 227(b)(1) of 
the Communications Act (the Act): e.g., as noted above, if the calls 
also contain other content (such as advertising) or precede the 
specified time period for calls excepted from the consent requirement. 
Moreover, these number and duration rules apply to calls by the federal 
government (to the extent it is the owner or guarantor of the debt) and 
its contractors, as explained in the Jurisdiction section below.
    24. The nature of restrictions, generally. The Commission 
determines, based on consumer complaints and on support from the 
record, that restrictions on the number and duration of federal debt 
collection calls are appropriate and necessary. In reaching this 
conclusion, the Commission bears in mind one reasonable interpretation 
of Congress' action in enacting the amendments: To make it easier for 
owners of debts owed to or guaranteed by the United States, as well as 
their contractors, to make calls to collect the debts. The Commission 
also bears in mind the TCPA's overarching goal to protect the privacy 
interests of consumers and Congress' express grant of authority to the 
Commission to place certain restrictions on federal debt collection 
calls. In seeking to balance these two interests, the Commission limits 
the number of federal debt collection calls to three in thirty days, 
with exceptions as noted below; limits the length of calls using an 
artificial voice or prerecorded voice, and autodialed text messages; 
and limits the times of day when federal debt collection calls may be 
made to wireless numbers. As explained more fully below, these limits 
apply in the aggregate to all calls from a caller to a debtor, 
regardless of the number of debts of each type the servicer or 
collector holds for the debtor. This cap of three calls per thirty days 
is cumulative for debt servicing calls and debt collection calls. 
Finally, the Commission limits the number of calls in light of a 
debtor's right to stop federal debt collection calls and to be notified 
of this right.
    25. Number of calls. In the 2016 NPRM, the Commission proposed to 
limit the number of federal debt collection calls to three per month, 
per delinquency, only after delinquency. Several commenters support 
this number. One commenter reminds the Commission, ``it is important to 
keep in mind that the calls made pursuant to this regulation are 
without consent, and are likely to comprise only a portion of the many 
other calls and contacts that debt collectors have with the debtors 
from whom they are collecting.'' Other commenters, however, argue for 
higher limits, stating that ``it takes significantly more than three 
contact attempts to reach the borrower and additional contacts to 
effectively resolve a borrower's delinquency or default.'' One 
commenter asserts that it needs 50 calls over several months to reach 
the right person and have a conversation. Another states that it takes 
14.3 attempts to contact a consumer. A third commenter states that it 
needs approximately 50 follow-up calls, but that those calls are 
consented-to. Two commenters assert that approximately ten call 
attempts per month is an appropriate rate at which to contact debtors. 
A mortgage servicer states: ``By making up to five calls in the two 
weeks prior to a client becoming 60 days delinquent, we saw 
approximately 50% more clients become current on the loan when compared 
to those who weren't called.''
    26. As these comments demonstrate, there is no consensus in the 
record. The Department of Education states that it ``does not believe 
that allowing loan servicers and [private collection agencies] to make 
three [federal debt collection calls] per month would measurably 
increase the likelihood that they would reach a borrower,'' but that 
``a higher limit will reasonably allow'' them to do so. Consumer groups 
generally argue that three calls is the appropriate number for calls 
pursuant to the Budget Act amendments. As commenter Navient notes, 
however, these commenters often ``fail to explain why three calls is an 
appropriate limit.'' Additionally, callers filing comments cite 
statistics and call patterns documenting their perceived need for more 
calls--but even callers vary widely when advocating for a number on 
federal debt collection calls. Congress

[[Page 80599]]

gave the Commission express authority to limit the number and duration 
of wireless federal debt collection calls, and the record documents the 
benefits to consumers of some number of covered calls. The Commission, 
therefore, must engage in an exercise in line drawing as it balances 
the competing interests to determine an appropriate limit on the number 
of federal debt collection calls.
    27. The Commission determines, subject to the exception below, that 
a limit of three federal debt collection calls in a thirty-day period 
is appropriate. As stated above, a significant number of commenters 
support this numeric restriction. Furthermore, the overwhelming 
majority of individual commenters support the Commission imposing a low 
limit on the number of calls allowed pursuant to the Budget Act 
amendments. Commenters asking for a higher limit have failed to offer a 
compelling justification for any of the various limits they support. At 
the same time, the Commission agrees with consumer groups that have 
noted that callers may make as many calls as they like--they simply 
need to obtain the consent of the debtor or contact consumers without 
making a robocall.
    28. The Commission, therefore, concludes that the appropriate limit 
for the number of federal debt collection calls is three calls within 
thirty days while the delinquency remains or following a specific, 
time-sensitive event, with such calls also permitted in the 30 days 
before such an event (but not before delinquency). The Commission 
recognizes, however, that some federal agencies, based on their 
expertise administering their respective statutes and programs, may 
desire additional calls. Balancing these needs with the TCPA's goal of 
protecting consumers from unwanted calls, the Commission notes that 
federal agencies may request a waiver seeking a different limit on the 
number of autodialed, prerecorded-voice, and artificial-voice calls 
that may be made without consent of the called party. The Commission 
delegates to the Consumer and Governmental Affairs Bureau the authority 
to address any such waivers.
    29. The Commission is not persuaded by callers who argue that more 
calls are needed or that other regulatory or contractual obligations 
might impose higher limits on the total number of calls. The Commission 
is not limiting the total number of calls that may be made; instead, 
the Commission is exercising its statutory authority and discretion to 
establish a limit on the number of autodialed, prerecorded-voice, and 
artificial-voice calls that can be made without the consent of the 
called party for the limited purpose at issue here. Thus, the 
Commission sets this limit with the knowledge that callers may make 
additional autodialed, artificial-voice, and prerecorded-voice calls if 
they obtain the prior express consent of the called party or if they 
dial manually. Robocallers are free, of course, to obtain prior express 
consent for additional calls and the Commission presumes that consumers 
who find the calls beneficial will provide it.
    30. Consumer ability to stop federal debt collection calls. The 
Commission has determined that an ability to stop unwanted calls is 
critical to the TCPA's goal of consumer protection. That right is 
likely more important here, where consumers need not consent to the 
calls in advance in order for a caller to make federal debt collection 
calls. As one commenter notes, ``[r]equiring calls to stop after the 
consumer so requests constitutes a limit on the number of calls that 
can be made, and Congress explicitly authorized the Commission to limit 
the number of calls.'' The Commission agrees. The Commission has stated 
that one reasonable interpretation of the statute is that Congress 
intended to make it easier for consumers to obtain useful information 
about debt repayment, which may be conveyed in these calls. When a 
debtor has rejected that presumption and declared that he or she no 
longer wishes to receive these calls, there is no longer any reason for 
the calls to continue. The Commission determines, per its authority to 
limit the number of federal debt collection calls, that consumers have 
a right to stop the covered autodialed, artificial-voice, and 
prerecorded-voice servicing and collection calls to wireless numbers at 
any point the consumer wishes. The debtor may make this request to the 
caller. Several commenters support this decision and the Commission's 
ability to make it. If Congress intended these amendments to make it 
easier for consumers to obtain useful information about debt repayment, 
then consumers may request that the calls stop if they do not find the 
calls or the information they contain useful. The Commission's rules, 
therefore, require that zero federal debt collection calls are 
permitted once a debtor asks the owner of the debt or its contractor to 
cease federal debt collection calls. This requirement that callers 
immediately honor a request to stop calls applies even where the caller 
has previously obtained prior express consent to make federal debt 
collection calls.
    31. The Commission also understands that debts may be transferred 
from one servicer or collector to another. This stop-calling request is 
specific to the debt and the consumer, and transfers with the debt; 
once the consumer has asked that the number of federal debt collection 
calls be reduced to zero, only the consumer can alter that number 
restriction. Consequently, a stop-calling requests applies to a 
subsequent collector or servicer of the same debt. In reaching this 
determination, the Commission rejects a commenter's proposal that a 
stop-calling request be limited to a period of time such as a month, 
but be renewable. Because the stop-calling request for federal debt 
collection calls applies for the life of the debt, servicers and 
collectors must ensure that information regarding the request conveys 
with the other relevant information regarding the debt when it is sold 
or transferred between servicers or collectors. The requirement that 
the stop-call request conveys from one servicer or collector to the 
next implicates the Paperwork Reduction Act, as indicated in the 
Commission's rules, and in the Final Regulatory Flexibility Act.
    32. Granting consumers a right to request calls stop at any point 
is only useful if consumers know of this right. The Commission agrees 
with the FTC staff that ``[a]n opt-out right [] is only effective if it 
is well-known'' rather than with the commenters who argue that a 
consumer should be notified of the right only once and in writing, or 
that notifying consumers of the right within every phone call will 
``cause a consumer to attach undue significance to such a right.'' The 
Commission, therefore, requires callers to inform debtors of their 
right to make such a request. The disclosure of rights must inform the 
debtor that he or she has a right to request that no further 
autodialed, artificial-voice, or prerecorded-voice calls be made to the 
debtor for the life of the debt, and that such request may be made by 
any reasonable method. Disclosures must be made in a manner that gives 
debtors an effective opportunity to stop future calls. Callers must 
disclose this consumer right within every completed autodialed call 
with a live caller, whether the caller speaks with the debtor or leaves 
a voicemail message. Calls using a prerecorded or artificial voice must 
disclose the right within each message. Covered text messages must 
disclose the right within each text message or in a separate text 
message that contains only the disclosure and is sent immediately 
preceding the first covered text message.

[[Page 80600]]

If the disclosure is in a separate text message, that message does not 
count toward the numeric limits the Commission imposes in document FCC 
16-99.
    33. The Commission has previously determined that consumers may opt 
out of calls for which prior consent is required, and that they may do 
so using any reasonable method, including orally or in response to a 
text message. Here, where the federal debt collection calls do not 
require consent, but where consumers may request at any time that calls 
stop, consumers may also make a stop-calling request using any 
reasonable method, including orally or in response to a text message. 
The Commission reaches this conclusion regarding the methods by which a 
consumer may make a stop-calling request after considering consumer 
confusion, standard calling practices, and recordkeeping procedures. 
The Commission anticipates that confusion will be minimized and calling 
practices will be streamlined if stop-calling methods and opt-out 
procedures are consistent. For similar reasons, the Commission 
determines that federal debt collection calls made using a prerecorded 
or artificial voice must include an automated, interactive voice- and/
or key press-activated opt-out mechanism so that debtors who receive 
these calls may make a stop-calling request during the call by pressing 
a single key. When a federal debt collection call using an artificial 
voice or prerecorded voice leaves a voicemail message, that message 
must also provide a toll-free number that the debtor may call at a 
later time to connect directly to the automated, interactive voice and/
or key press-activated mechanism and automatically record the stop-
calling request. Text message disclosures must include brief 
explanatory instructions for sending a stop-call request by reply text 
message and provide a toll-free number that enables the debtor to call 
back later to make a stop-call request. The requirement that the 
artificial- and prerecorded-voice calls, as well as text messages, 
include opt-out instructions and features implicates the Paperwork 
Reduction Act, as indicated in the Commission's rules, and in the Final 
Regulatory Flexibility Act.
    34. When may federal debt collection calls be made? In order for a 
federal debt collection call to produce the intended effect of 
``collect[ing] a debt owed to or guaranteed by the United States,'' it 
must occur close in time to a key event in the life of the debt. As set 
forth above, calls ``solely to collect a debt'' may be collection calls 
or servicing calls because both increase the likelihood of a debt being 
collected. The Commission has interpreted the statutory phrase ``solely 
to collect a debt'' to limit debt collection calls to a period when a 
debt is delinquent, and to limit debt servicing calls to following a 
specific, time-sensitive event and in the 30 days before such an event. 
The Commission here uses the authority Congress granted it to limit the 
number and duration of calls ``to collect a debt owed to or guaranteed 
by the United States.'' The rules the Commission enacts today state 
that zero calls are permitted under the Budget Act amendments unless 
they occur: (1) During the period of delinquency for debt collection 
calls; and (2) following an enumerated, specific, time-sensitive event 
and in the 30 days before such an event for debt servicing calls.
    35. Content of the calls. As stated above, the Commission's 
interpretation of the statutory phrase ``solely to collect a debt'' 
excludes calls that contain marketing, advertising, or selling products 
or services. The Commission here uses the authority Congress granted it 
to limit the number and duration of calls ``to collect a debt owed to 
or guaranteed by the United States.'' The rules the Commission enacts 
today state that zero calls are permitted under the Budget Act 
amendments if the autodialed, prerecorded-voice, or artificial-voice 
call contains any marketing, advertising, or selling of products or 
services. Commenters support this determination. The Commission's 
determination regarding calls that contain marketing, advertising, or 
sales also supports the Commission's interpretation of Congress' intent 
that the calls provide consumers with useful information about repaying 
their debt, and it is a step in preventing the very real problem that 
consumers will be subject to fraudulent calls and programs.
    36. Calls only to the debtor. The Commission also here enacts rules 
stating that zero calls are permitted under the Budget Act amendments 
unless the calls are to the debtor or the person responsible for paying 
the debt, and the call is made to that person at one of the three 
categories of numbers specified in document FCC 16-99. The Commission's 
interpretation of the statutory phrase ``solely to collect'' explains 
its reasoning for establishing these limits on who may be called and 
the numbers at which these persons may be called. The Commission finds 
that the reasoning applies here as well, where Congress has authorized 
it to limit the number of calls made ``to collect a debt.'' Calls to 
persons other than the debtor or other entities responsible for paying 
the debt are not directly tied to collecting a debt. In balancing the 
inconvenience to uninvolved persons against the interests of callers, 
the Commission determines it is not appropriate to extend federal debt 
collection calls beyond the debtor and others responsible for paying 
the debt. Likewise, calls to numbers other than the three categories of 
telephone numbers the Commission specified above are unlikely to reach 
the person responsible for repaying the debt, and so are unlikely to 
result in collection of the debt. The Commission, therefore, limits to 
zero calls made to persons or telephone numbers other than these.
    37. Call limits are per caller. Commenters also ask the Commission 
to ``clarify whether the [limited number of federal debt collection 
calls] is per debtor (e.g., inclusive of all telephone numbers used by 
the debtor)'' per delinquency, or per servicer or collector. One 
consumer advocate states: ``[B]ecause many consumers have multiple 
loans--often eight to ten student loans for each borrower--we recommend 
that the number of calls or texts permitted to be made without consent 
should be limited to three calls per servicer or collector. Without 
this limitation, consumers who have eight to ten outstanding loans, as 
many do, could be receiving between twenty-four and thirty robocalls 
per month to their cell phones.'' Because the Commission has set the 
federal debt collection call limit at three calls per thirty days, that 
number could rise to twenty-four to thirty robocalls per month if the 
Commission were to determine that the call limit applied per loan. In 
light of the record, and to prevent an excessive number of calls to 
individual debtors, the Commission determines that the call limit on 
federal debt collection calls to wireless numbers applies for each 
servicer or collector. If the servicer or collector has contracts with 
the United States for more than one type of debt--for example to 
collect or service student loans and Department of Agriculture loans--
the servicer may utilize a three-call in thirty day limit for each type 
of loan the servicer or collector manages for the debtor.
    38. Length of federal debt collection calls. In the 2016 NPRM, the 
Commission sought comment on the maximum duration of a voice call, and 
whether it should adopt different duration limits for prerecorded- or 
artificial-voice calls than for autodialed calls with a live caller. 
Commenters generally support the idea of a maximum length for 
artificial-voice and prerecorded-voice calls, but not a maximum length 
for autodialed calls

[[Page 80601]]

with a live caller because this could impinge on a potentially lengthy 
conversation between a servicer and a debtor. Commenters who support a 
maximum length for artificial- and prerecorded-voice calls suggest caps 
of 30 or 60 seconds. Some commenters suggest that the time limit 
include time for any required disclosures, while others ask that 
required disclosures be outside of any time cap the Commission sets. In 
light of the record, the Commission determines that artificial-voice 
and prerecorded-voice calls may not exceed 60 seconds, exclusive of any 
required disclosures. The Commission does not place any cap on the 
duration of live-caller, autodialed calls made pursuant to the Budget 
Act exception.
    39. The Commission also asked in the 2016 NPRM whether it should 
impose a limit on the length of text messages, and what that limit 
should be. Commenters note that senders of text messages generally keep 
the messages short because ``[a] long text message would get split up 
into multiple texts and could confuse the borrower.'' Other commenters 
ask that any cap on the length of a text message account for required 
disclosures. Text messages are generally limited to 160 characters. As 
stated above, any required disclosures may be included within this 160-
character limit for a single text message or may be sent as a separate 
text message that does not count toward the numeric limits the 
Commission imposes herein.
    40. Time of day restrictions. The Commission imposes an additional 
restriction on the number of federal debt collection calls or texts 
allowed, and determines that no federal debt collection calls or texts 
are permitted outside the hours of 8:00 a.m. to 9:00 p.m. (local time 
at the called party's location), which is identical to the rule for 
telemarketing calls. Congress stated that federal debt collection calls 
are intended ``to collect a debt,'' and during these times consumers 
are likely available to answer calls and receptive to receiving 
information from callers. The record supports the Commission's 
determination that consumers are generally comfortable with receiving 
calls during these times. Furthermore, FTC staff notes that the FDCPA 
and the Telemarketing Sales Rule ``similarly limit debt collection and 
telemarketing calls to this same timeframe.'' Adding a new category of 
calls to this generally accepted timeframe will cause less 
inconvenience and confusion to consumers than if the Commission were to 
impose a different schedule or no schedule for these calls. Likewise, 
call centers that contract with businesses to make calls on their 
behalf are familiar with these time-of-day restrictions; this 
restriction should not impose a burden on callers or their contractors 
making federal debt collection calls.
    41. Multiple sets of regulations. The Commission acknowledges that 
other statutes and regulations impact debt collection calls, yet it 
recognizes that Congress assigned to the Commission responsibility for 
crafting rules for autodialed, artificial-voice, and prerecorded-voice 
debt collection calls where the debt is owed to or guaranteed by the 
United States. Because Congress specifically gave the Commission 
certain authority over these federal debt collection calls, the 
Commission assumes that callers will follow the most restrictive rules 
for the call being made. Which rules apply will vary based on a number 
of factors, such as whether the caller is a debt collector or a debt 
servicer, the nature of the debt, and the length of delinquency. Where 
multiple rules apply to the same call and one of the rules is enacted 
by the Commission to implement the TCPA, a caller must comply with the 
most restrictive requirements regarding factors such as frequency, time 
of day, and so on. Section 301 of the Budget Act affects the TCPA and 
its implementing regulations but does not affect other laws, including 
specifically those for which the CFPB or the FTC have responsibility.

Other Implementation Issues

    42. Covered Calls to Residential Lines. The Commission notes that 
under the current rules, artificial- or prerecorded-voice calls to 
residential lines that are made for the purpose of collecting a debt 
are currently not subject to the prior express consent requirement. 
Although the TCPA allows for broad coverage of the prior express 
consent requirement to all non-emergency artificial- and prerecorded-
voice calls to residential lines, the Commission has exercised its 
statutory exemption authority so as to apply the consent requirement 
only to calls that include or introduce an advertisement or constitute 
telemarketing. The Commission has also found that debt collection calls 
do not constitute telemarketing.
    43. Congress, in authorizing the Commission to enact rules 
implementing the Budget Act's amendments, stated that the Commission 
could ``restrict or limit the number and duration of calls made to a 
telephone number assigned to a cellular telephone service.'' Congress, 
by omission, did not authorize the Commission to enact rules to limit 
the number and duration of calls made to a telephone number assigned to 
a residential telephone line. Commenters support this understanding of 
the Budget Act amendment with regard to calls to numbers assigned to 
residential lines, stating: ``Congress did not grant the Commission the 
authority to restrict or limit'' these calls. Consequently, the 
Commission's current rules regarding non-telemarketing autodialed, 
prerecorded-voice, and artificial-voice calls to residential numbers 
are not altered by the Budget Act amendments. The Commission is not 
imposing restrictions on these calls. Callers may, however, be subject 
to restrictions under other applicable statutes and regulations, such 
as the Fair Debt Collection Practices Act.
    44. Restrictions on Calls to Cellular Telephone Service. Congress 
authorized the Commission to ``restrict or limit the number and 
duration of calls made to a telephone number assigned to a cellular 
telephone service to collect a debt owed to or guaranteed by the United 
States.'' Yet, the amendment to the TCPA, authorizing calls made to 
collect a debt owed to or guaranteed by the United States, is broader, 
applying to ``any telephone number assigned to a paging service, 
cellular telephone service, specialized mobile radio service, or other 
radio common carrier service, or any service for which the called party 
is charged for the call.'' Considering the identical language in the 
prior delegation of authority in section 227(b)(2)(C) of the Act, the 
Commission concludes that Congress delegated the Commission authority 
to limit the number and duration of all calls made pursuant to the debt 
collection exception in section 227(b)(1)(A)(iii) of the Act.
    45. Congress, in granting the Commission authority to limit the 
number and duration of calls, used identical language to the language 
it used in the separate delegation of authority in section 227(b)(2)(C) 
of the Act. The identical language in these two delegations of 
authority indicates that Congress intended the two provisions to apply 
to the same services.
    46. The Commission has interpreted section 227(b)(2)(C) of the Act 
to apply to all services mentioned in section 227(b)(1)(A)(iii) of the 
Act. In so doing, it has interpreted ``cellular telephone service'' by 
asking whether services are functionally equivalent from the consumer 
perspective rather than on technical or regulatory differences, such as 
which spectrum block is used to provide the service. This avoids, for 
example, consumers receiving wireless voice service from being treated 
differently depending on which

[[Page 80602]]

spectrum block their carriers use and callers having to determine which 
spectrum block is used for a particular consumer's service in order to 
know which requirements apply.
    47. Applying the canon of statutory construction that Congress 
knows the law, including relevant agency interpretations, at the time 
it adopts a statute, the Commission presumes that Congress knew of the 
Commission's interpretation of this key language. Congress used the 
same language in the recent delegation of authority without taking any 
action to alter the Commission's interpretation of identical language 
elsewhere in the same statute. The Commission therefore concludes that 
the authority delegated to it in the new section 227(b)(2)(H) of the 
Act added by the Budget Act applies to all services to which amended 
section 227(b)(1)(A)(iii) of the Act applies.
    48. Application of Other TCPA Restrictions to Covered Calls. The 
Commission believes the most reasonable interpretation of the Budget 
Act amendments is that they except covered calls from the requirement 
to obtain the consent of the called party, and that calls must in every 
other respect comply with the TCPA unless compliance with a requirement 
of the TCPA is prohibited by a separate regulation pertaining to debt 
collection calls generally. The Budget Act amendments apply to the 
consent requirement of section (b)(1) of the Act, but other sections of 
the TCPA are left unaffected. For example, the identification 
requirements of Sec.  64.1200(b)(1) through (2) of the Commission's 
rules apply to both excepted calls and other calls made using an 
autodialer, a prerecorded voice, and an artificial voice. The exception 
Congress created in the Budget Act amendments is not an exception to 
compliance with the TCPA as a whole, but only with the requirement to 
obtain the consent of the called party to make the call. The Commission 
will resolve conflicts on a case-by-case basis.
    49. Other Issues. Commenters in the record raise other arguments 
for the Commission's consideration in enacting rules for the Budget Act 
amendments. For example, one commenter asks the Commission to state 
that ``no debt collection calls [may be made to] people receiving 
Supplemental Security Income (SSI) benefits on the basis of old age or 
disability, and that Treasury not pass along information on debts owed 
by SSI recipients to debt collectors.'' Another commenter asks the 
Commission to develop ``a separate set of rules to assist federal 
student loan borrowers.'' A separate commenter asks the Commission to 
create a certification system that authorizes callers to use 
autodialers for purposes of making covered calls and only renews the 
certification if the caller's yearly performance meets standards 
established by the Commission and the Department of Education. The 
Commission declines to address these and other ancillary issues and 
arguments raised in the record as they are outside the scope of this 
proceeding. Moreover, these issues are not fully developed in the 
record and the Commission would need more facts to meaningfully and 
cogently address these issues.

Severability

    50. All of the rules that are adopted in document FCC 16-99 are 
designed to ensure a caller's ability to make calls pursuant to the 
Budget Act amendments and a debtor's ability to control the calls he or 
she receives. Each of the determinations the Commission undertakes in 
document FCC 16-99 serve a particular function toward this goal. 
Therefore, it is the Commission's intent that each of the rules and 
regulations adopted herein shall be severable. The Commission believes 
that debtors will benefit from the information they may receive from 
callers and will also benefit from the ability to ask that calls be 
stopped. If any of the rules or regulations, or portions thereof, are 
declared invalid or unenforceable for any reason, it is the 
Commission's intent that the remaining rules shall be in full force and 
effect.

Effective Date

    51. As noted in the discussion above, two portions of the 
Commission's rules implicate the Paperwork Reduction Act (PRA). These 
portions involve the rules for the recording of a debtor's request to 
stop receiving autodialed, artificial-voice, and prerecorded-voice 
calls to collect a debt owed to or guaranteed by the United States, and 
rules for the conveyance of that stop-call request from one servicer or 
collector to another. Because these portions of the rules implicate the 
PRA, they will not become effective until 60 days after the Commission 
publishes a Notice in the Federal Register indicating approval of the 
information collection by OMB.
    52. The remaining rules will not become effective until the rules 
requiring OMB approval become effective. While these remaining rules do 
not require OMB approval and could become effective immediately upon 
release of document FCC 16-99, the Commission determines that the 
consumer-protection rules regarding stop-call requests and conveyance 
of those requests are so integral to this regulatory scheme that the 
remaining rules should not become effective until the consumer-
protection rules are in place. The rules that could become effective 
immediately permit a caller to make calls--they specify how many calls 
may be made, who may make the calls, when the calls can be made, and to 
which numbers the calls may be made, among other things. These rules 
give effect to one of the reasonable interpretations the Commission has 
identified for Congress' passage of the Budget amendments: to make it 
easier for owners of debts owed to or guaranteed by the United States 
and their contractors to make calls to collect debts. But the second 
reasonable interpretation--to make it easier for consumers to obtain 
useful information about debt repayment--carries with it a consumer's 
prerogative to determine that the debtor does not want the information 
conveyed in the calls and to ask that the calls stop. The rules that 
give effect to this interpretation of Congress' intent are delayed by 
PRA requirements and OMB approval. The Commission determines that the 
regulatory scheme it implements today must include both the ability for 
callers to make calls and the right of debtors to ask that calls stop--
and that both portions of the regulatory scheme become effective 
simultaneously. To do otherwise would be to allow callers to make calls 
but to leave debtors with no consumer protections until OMB approval is 
complete. The Commission determines that both portions of the rules 
must become effective for the regulatory scheme to be effective.
    53. The notice of OMB's approval of the information collections, 
the announcement of the effective date for the rule changes adopted on 
August 2, 2016, and released on August 11, 2016, and the appropriate 
amendatory language, will be contained in a document published in the 
Federal Register at a later date.

Language of Rule Changes To Implement Regulatory Scheme

    54. The amendments to Sec. Sec.  64.1200(j)(3) and (j)(4) require 
OMB approval under the Paperwork Reduction Act (PRA) and will not go 
into effect until 60 days after we publish a notice in the Federal 
Register announcing OMB's approval and the effective date, and 
containing the formal amendatory language for the rules. The complete 
text of the rule changes may be found in the appendix to the 
Commission's decision, available on the

[[Page 80603]]

agency Web site. The subsection (j)(3) and (j)(4) rule changes are 
summarized as follows:
     Required Disclosures. Prerecorded-voice, artificial-voice, 
or autodialed calls to collect a debt owed to or guaranteed by the 
United States must include a disclosure that the debtor has a right to 
request that no further calls of this type be made to the debtor for 
the life of the debt and that such requests may be made by any 
reasonable method. Disclosures must be made in a manner that gives 
debtors an effective opportunity to stop future calls. For voice 
telephone calls, the disclosure must be made within each telephone 
call. For autodialed text messages, the disclosure must be within each 
text message or in a separate text message that contains only the 
disclosure and that is sent immediately preceding the first text 
message permitted, but the text message containing the disclosure does 
not count toward the character limit contained elsewhere in the rules.
     Requests for no more calls. A debtor may request to the 
owner of the debt or its contractor that no further telephone calls be 
made to the debtor for the life of the debt by any reasonable method, 
including orally and by reply text message. No autodialed, prerecorded-
voice, or artificial-voice federal debt collection calls are permitted 
after the stop-call request. Telephone calls using an artificial or 
prerecorded voice must include an automated, interactive voice- and/or 
key press-activated opt-out mechanism that enables the debtor to make a 
stop-calling request prior to terminating the call, including brief 
explanatory instructions on how to use such mechanism. When a debtor 
elects to make a stop-calling request using such mechanism, it must 
automatically record the request and immediately terminate the call. 
When a telephone call using an artificial or prerecorded voice leaves a 
message on an answering machine or a voice mail service, the message 
must also include a toll free number that the debtor may call later to 
connect directly to the automated, interactive voice- and/or key press-
activated opt-out mechanism and automatically record the stop-calling 
request. Text messages containing the disclosure required elsewhere in 
the rules must include brief explanatory instructions for sending a 
stop-calling request by reply text message and provide a toll free 
number that enables the debtor to call back later to make a stop-
calling request.
    55. The Commission determined that the amendments to Sec. Sec.  
64.1200(a)(1)(iii); (a)(3)(iv), (v), and (vi); (f)(17); (i), and 
(j)(1)-(2),(5)-(9), which do not require OMB approval, nonetheless will 
not go into effect until 60 days after we publish a notice of OMB 
approval of Sec.  64.1200(j)(3) and (j)(4), the effective date for all 
the rule changes, and the amendatory language for the rules. The 
complete text of the rule changes may be found in the appendix to the 
Commission's decision, available on the agency Web site. These other 
rule changes are summarized as follows:
     No consent required for calls solely to collect a debt 
owed to or guaranteed by the United States. The prior express consent 
of the called party is not needed when: A call is made to a telephone 
number assigned to a cellular telephone service, among others; the call 
is made solely to collect a debt owed to or guaranteed by the federal 
government of the United States; and the call is made using an 
automatic telephone dialing system or an artificial or prerecorded 
voice. The prior express written consent of the called party is not 
needed when a call is made to a telephone number assigned to a 
residential line when the call is made pursuant to the collection of a 
debt owed to or guaranteed by the federal government of the United 
States and the call is made using an artificial or prerecorded voice.
     Debtor defined. Debtor is defined as the debtor; a co-
signor or other person or entity legally obligated to pay the debt; and 
an executor, guardian, administrator, receiver, trustee, or similar 
legal representative of the debtor or of another person or entity 
legally obligated to pay the debt.
     When a call is made solely to collect a debt owed to or 
guaranteed by the United States. To be considered a call made solely to 
collect a debt owed to or guaranteed by the United States, the 
telephone call must exclusively concern a debt that, at the time of the 
call, is owed to or guaranteed by the federal government of the United 
States and must contain no marketing, advertising, or sales 
information. The call must also be made by the owner of the debt, or 
its contractor, to the debtor. The entire content of the call must be 
directly and reasonably related either to collecting payment of a 
delinquent amount in order to cure such delinquency or to resolving the 
debt either by obtaining payment of such delinquent amount or by 
entering into an alternative payment arrangement that will cure such 
delinquency or resolve the debt, during a time period when a 
delinquency exists, or providing information about changes to the 
amount or timing of payments following the end of, or in the 30 days 
before: a grace, deferment, or forbearance period; expiration of an 
alternative payment arrangement; or occurrence of a similar time-
sensitive event or deadline affecting the amount or timing of payments 
due. The call must be made to the debtor at the wireless telephone 
number the debtor provided at the time the debt was incurred, or 
subsequently provided by the debtor to the owner of the debt or the 
owner's contractor, or a wireless telephone number obtained from an 
independent source, provided that the number actually is the debtor's 
telephone number.
     Number and duration limits on calls made to collect a debt 
owed to or guaranteed by the United States. Telephone calls made using 
an autodialer or a prerecorded or artificial voice to collect a debt 
owed to or guaranteed by the United States are limited to three calls 
to a debtor within a 30-day period but zero calls if a debtor requests 
no further calls. These limits apply whether the calls are made by the 
owner of the debt or by a contractor of the owner(s) of the debt. For 
purposes of determining the number of calls permitted, multiple debts 
owed by one debtor shall be considered one debt if the agent or 
contractor is servicing or collecting those debts on behalf of the same 
owner under the same contractual or agency relationship. The limit of 
zero calls if a debtor requests no further calls applies for the life 
of the debt; the limit of three calls in a 30-day period applies during 
each time period in which telephone calls may be made pursuant to 
paragraph (i)(2) of the rules.
     Length of federal debt collection calls. Artificial- and 
prerecorded-voice telephone calls may not exceed 60 seconds in length, 
excluding any required disclosures and stop-calling instructions. Text 
messages are limited to 160 characters in length.
     Other restrictions on calls made to collect a debt owed to 
or guaranteed by the United States. No telephone calls can be made 
before 8 a.m. or after 9 p.m. local time at the debtor's location. No 
calls are permitted if the call contains marketing, advertising, or 
sales information. No calls are permitted except to the debtor at the 
wireless telephone number the debtor provided at the time the debt was 
incurred, a wireless telephone number subsequently provided by the 
debtor to the owner of the debt or the owner's contractor, or a 
wireless telephone number the owner of the debt or its contractor has 
obtained from an independent source, provided that the number actually 
is the debtor's telephone number. No calls are permitted except during 
a time period when a delinquency exists, or following, or in the 30 
days before: The end of a

[[Page 80604]]

grace, deferment, or forbearance period; expiration of an alternative 
payment arrangement; or occurrence of a similar time-sensitive event or 
deadline affecting the amount or timing of payments due.
    Who must comply with the restrictions. Notwithstanding anything to 
the contrary, the number and duration rules for calls to collect a debt 
owed to or guaranteed by the United States apply to all autodialed, 
artificial-voice, or prerecorded-voice calls made to a wireless number 
including, for example, calls by any governmental entity or its agent.

Final Regulatory Flexibility Analysis

    56. As required by the Regulatory Flexibility Act of 1980 (RFA), as 
amended, an Initial Regulatory Flexibility Analyses (IRFA) was 
incorporated into the 2016 NRPM. The Commission sought written public 
comment on the proposals in the 2016 NRPM, including comment on the 
IRFA. The comments received are discussed below. This Final Regulatory 
Flexibility Analysis (FRFA) conforms to the RFA.

Need for, and Objectives of, the Order

    57. Document FCC 16-99 promulgates rules to implement section 301 
of the Bipartisan Budget Act of 2015, which amends the Telephone 
Consumer Protection Act by excepting from that Act's consent 
requirement robocalls to wireless numbers ``made solely to collect a 
debt owed to or guaranteed by the United States'' and authorizing the 
Commission to adopt rules to ``restrict or limit the number and 
duration'' of any calls to wireless numbers ``to collect a debt owed to 
or guaranteed by the United States.'' The Budget Act requires the 
Commission, in consultation with the Department of the Treasury, to 
``prescribe regulations to implement the amendments made'' by section 
301 of the Budget Act within nine months of enactment. In implementing 
these provisions, the Commission recognizes and seeks to balance the 
importance of collecting debt owed to or guaranteed by the United 
States and the consumer protections inherent in the TCPA. In adopting 
these rules today, the Commission fulfills the statutory requirement to 
prescribe rules to implement the amendments to the TCPA.
    58. Covered Calls. The Commission interprets ``solely to collect a 
debt'' and, therefore, calls made pursuant to the exception created by 
section 301 of the Budget Act, to be limited to 1) debts that are 
delinquent at the time the calls are made, and 2) debts for which there 
is an imminent, non-speculative risk of delinquency due to a specific, 
time-sensitive event that affects the amount or timing of payments due, 
such as a deadline to recertify eligibility for an alternative payment 
plan or the end of a deferment period. The Commission interprets ``owed 
to or guaranteed by the United States'' to include only debts that are 
owed to or guaranteed by the federal government at the time the call is 
made.
    59. The Commission determines that, because calls made pursuant to 
the exception must be made ``solely to collect a debt,'' the covered 
calls may only be made to the debtor or another person or entity 
legally responsible for paying the debt. The Commission further 
determines that covered calls may only be made to the wireless 
telephone number the debtor provided at the time the debt was incurred, 
such as on the loan application; to a wireless phone number 
subsequently provided by the debtor; or to a wireless number that the 
owner of the debt or its contractor has obtained from an independent 
source, provided that the number actually is the debtor's telephone 
number.
    60. The Commission determines that robocalls to wrong numbers are 
not covered by the exception created in the Budget Act amendments. 
Calls to reassigned wireless numbers may not be made pursuant to the 
amendment either, but they are subject to the 1-call window the 
Commission clarified in the 2015 Declaratory Ruling and Order.
    61. The Commission limits eligible callers to the owner of the debt 
or its contractor. The Commission determines that a ``call,'' for this 
exception, includes any initiated call, including a text message. The 
Commission determines that the excepted calls are limited in content to 
debt collection and servicing; they may not include any marketing, 
advertising, or selling products or services, or other irrelevant 
content.
    62. Limits on Number and Duration of Federal Debt Collection Calls. 
The Commission limits the number of federal debt collection calls to 
three calls within a thirty-day period while the delinquency remains or 
following a specific, time-sensitive event, and in the 30 days before 
such an event. The Commission determines that consumers have a right to 
stop autodialed, artificial-voice, and prerecorded-voice servicing and 
collection calls to wireless numbers at any point the consumer wishes. 
Callers must inform debtors of their right to make such a request. The 
Commission limits federal debt collection calls so that zero calls are 
permitted unless they occur: (1) During the period of delinquency for 
debt collection calls; and (2) following an enumerated, specific, time-
sensitive event for debt servicing calls, and in the 30 days before 
such an event.
    63. The Commission determines that artificial-voice and 
prerecorded-voice calls may not exceed 60 seconds, excluding any 
required disclosures. The Commission does not place any cap on the 
duration of live-caller, autodialed calls. The Commission limits text 
messages to 160 characters. Any required disclosures may be included 
within these 160 characters or may be sent as a separate text message 
that does not count toward the numeric limits. The Commission 
determines that no federal debt collection calls or texts are permitted 
outside the hours of 8:00 a.m. to 9:00 p.m. (local time at the called 
party's location). The Commission determines that if multiple rules 
apply to the same call and one of the rules is enacted by the 
Commission to implement the TCPA, a caller must comply with the most 
restrictive requirements regarding factors such as frequency, time of 
day, and so on.
    64. Other Implementation Issues. The Commission interprets section 
227(b)(2)(C) of the Act to apply to all services mentioned in section 
227(b)(1)(A)(iii) of the Act, which excludes residential lines.

Summary of Significant Issues Raised by Public Comments in Response to 
the IRFA

    65. In document FCC 16-99, the Commission solicited comments on how 
to minimize the economic impact of the proposals on small businesses. 
The Commission received three comments directly addressing the IRFA. 
Two of the comments addressed the area of duplicate, overlapping, or 
conflicting rules, and one addressed coordination with the ongoing 
Consumer Financial Protection Bureau (CFPB) rulemaking. In addition, 
the Commission received six consumer comments that were against 
robocalls where the filer mentioned being the owner of a small 
business. None of the comments pointed out any areas where small 
businesses would incur a particular hardship in complying with the 
rules.
    66. Duplicate, Overlapping, or Conflicting Rules. Both CMC and NSC 
claim that the Commission failed to identify rules that ``duplicate, 
overlap or conflict with the proposed rule'' as required by the 
Regulatory Flexibility Act. The Commission acknowledges that other 
statutes and regulations impact debt collection calls. The TCPA 
regulates autodialed, prerecorded-voice, and artificial-voice calls. 
The rules the

[[Page 80605]]

Commission adopted are concerned only with regulating that subset of 
autodialed, artificial-voice, and prerecorded-voice calls that are made 
to wireless numbers and to collect a debt that is owed to or guaranteed 
by the United States. The TCPA amendments and these implementing rules 
change only the specific conditions under which a caller can use an 
autodialer, prerecorded voice, and artificial voice to make calls to a 
wireless number without the prior express consent of the called party 
and the limitations that apply to autodialed, prerecorded-voice, or 
artificial-voice calls to a wireless number made to collect a debt owed 
to or guaranteed by the United States.
    67. CMC suggests that the rules conflict with ``longstanding 
federal and state foreclosure prevention efforts and policies''; 
``several federal requirements to call mortgage borrowers by telephone 
to try to prevent foreclosures''; ``any new FCC rule permitting 
consumers to block calls''; ``[t]he FDCPA prohibit[ion of] unfair 
practices by debt collectors in attempting to collect a debt''; and 
``[t]he Dodd-Frank Act prohibit[ion of] unfair, deceptive, or abusive 
acts or practices by covered persons or service providers, including 
consumer mortgage servicers.'' However, none of the rules cited by CMC 
require that calls to wireless numbers be autodialed, artificial-voice, 
or prerecorded-voice calls. The TCPA, with or without the amendments, 
does not regulate whether or when a debt collector can make a debt 
collection call, nor does it in any way prohibit a mortgage servicer 
from making a call in compliance with foreclosure requirements. Debt 
collectors and mortgage servicers continue to be free to make calls in 
compliance with non-TCPA law. The rules the Commission adopted apply 
only to autodialed, prerecorded-voice, and artificial-voice calls. 
Therefore the rules cited by CMC do not ``duplicate, overlap or 
conflict with'' the proposed rule.
    68. Coordination with the CFPB. ACA notes that the CFPB ``will 
convene one or more panels under the Small Business Regulatory 
Enforcement Fairness Act to assess the potential impact of its debt 
collection proposals under consideration on affected small business, 
including by obtaining feedback from small entity representatives.'' 
ACA suggests that the Commission wait for the results of the CFPB's 
analysis, particularly since ``the substantial majority of collection 
agencies are `small' under the Small Business Administration's size 
standard.'' The Commission declines to do so for two reasons. First, 
the deadline of August 2nd imposed by Congress prohibits the delay of 
this rulemaking. Second, the CFPB is analyzing overall debt collection 
rules and policies, a much wider scope than the narrow area covered by 
these rules, which are limited to regulating autodialed, artificial-
voice, and prerecorded-voice calls to wireless numbers to collect a 
debt owed to or guaranteed by the United States. It is unlikely that 
the CFPB panels will provide more information than that which has 
already been received through the notice and comment process that began 
with the 2016 NPRM.
    69. Cost Analysis. CMC recommends that the Commission ``consider 
the costs of mortgage delinquencies and foreclosures and mortgage 
`rescue' scams that telephone calls could have prevented or mitigated'' 
as part of the cost analysis. The Commission has considered comments 
asserting the potential benefits to debtors of receiving the 
autodialed, pre-recorded voice, and artificial-voice calls at issue in 
developing the rules, including in balancing the importance of 
collecting debt owed to or guaranteed by the United States and the 
consumer protections inherent in the TCPA. Such costs as CMC mentions 
would not be incurred by regulated entities and, in this context, would 
be both hypothetical and highly speculative. As a result, the 
Commission does not attempt to quantify the costs raised by CMC in the 
Description of Projected Reporting, Recordkeeping, and Other Compliance 
Requirements for Small Entities section below.

Response to Comments by the Chief Counsel for Advocacy of the Small 
Business Administration

    70. Pursuant to the Small Business Jobs Act of 2010, which amended 
the RFA, the Commission is required to respond to any comments filed by 
the Chief Counsel for Advocacy of the Small Business Administration 
(SBA), and to provide a detailed statement of any change made to the 
proposed rules as a result of those comments. The Chief Counsel did not 
file any comments in response to the proposed rules in this proceeding.

Description and Estimate of the Number of Small Entities To Which Rules 
Will Apply

    71. The RFA directs agencies to provide a description of, and where 
feasible, an estimate of the number of small entities that may be 
affected by the rules adopted herein. The RFA generally defines the 
term ``small entity'' as having the same meaning as the terms ``small 
business,'' ``small organization,'' and ``small governmental 
jurisdiction.'' In addition, the term ``small business'' has the same 
meaning as the term ``small-business concern'' under the Small Business 
Act. A ``small-business concern'' is one which: (1) Is independently 
owned and operated; (2) is not dominant in its field of operation; and 
(3) satisfies any additional criteria established by the SBA.
    72. The Commission's rules restricting autodialed, artificial-
voice, and prerecorded-voice calls to wireless numbers apply to all 
entities that make such calls or texts to wireless telephone numbers to 
collect debts owed to or guaranteed by the United States. Thus, the 
rules set forth in this proceeding are likely to have an impact on a 
substantial number of small entities in several categories.
    73. Collection Agencies. This industry comprises establishments 
primarily engaged in collecting payments for claims and remitting 
payments collected to their clients. The SBA has determined that 
Collection Agencies with $15 million or less in annual receipts qualify 
as small businesses. Census data for 2012 indicate that 3,361 firms in 
this category operated throughout that year. Of those, 3,166 firms 
operated with annual receipts of less than $10 million. The Commission 
concludes that a substantial majority of businesses in this category 
are small under the SBA standard.
    74. Telemarketing Bureaus and Other Contact Centers. This U.S. 
industry comprises establishments primarily engaged in operating call 
centers that initiate or receive communications for others--via 
telephone, facsimile, email, or other communication modes--for purposes 
such as (1) promoting clients products or services, (2) taking orders 
for clients, (3) soliciting contributions for a client, and (4) 
providing information or assistance regarding a client's products or 
services. These establishments do not own the product or provide the 
services they are representing on behalf of clients. The SBA has 
determined that Telemarketing Bureaus and other Contact Centers with 
$15 million or less in annual receipts qualify as small businesses. 
U.S. Census data for 2012 indicate that 2,251 firms in this category 
operated throughout that year. Of those, 2,014 operated with annual 
receipts of less than $10 million. The Commission concludes that a 
substantial majority of businesses in this category are small under the 
SBA standard.
    75. Commercial Banks and Savings Institutions. Commercial banks are 
establishments primarily engaged in

[[Page 80606]]

accepting demand and other deposits and making commercial, industrial, 
and consumer loans. Commercial banks and branches of foreign banks are 
included in this industry. Savings institutions are establishments 
primarily engaged in accepting time deposits, making mortgage and real 
estate loans, and investing in high-grade securities. Savings and loan 
associations and savings banks are included in this industry. The SBA 
has determined that Commercial Banks and Savings Institutions with $500 
million or less in assets qualify as small businesses. December 2013 
Call Report data compiled by SNL Financial indicate that 6,877 firms in 
this category operated throughout that year. Of those, 5,533 qualify as 
small entities. Based on this data, the Commission concludes that a 
substantial number of businesses in this category are small under the 
SBA standard.
    76. Credit Unions. This industry comprises establishments primarily 
engaged in accepting members' share deposits in cooperatives that are 
organized to offer consumer loans to their members. The SBA has 
determined that Credit Unions with $550 million or less in assets 
qualify as small businesses. The December 2013 National Credit Union 
Administration Call Report data indicate that 6,687 firms in this 
category operated throughout that year. Of those, 6,252 qualify as 
small entities. Based on this data, the Commission concludes that a 
substantial number of businesses in this category are small under the 
SBA standard.
    77. Other Depository Credit Intermediation. This industry comprises 
establishments primarily engaged in accepting deposits and lending 
funds (except commercial banking, savings institutions, and credit 
unions). Establishments known as industrial banks or Morris Plans and 
primarily engaged in accepting deposits, and private banks (i.e., 
unincorporated banks) are included in this industry. The SBA has 
determined that Other Depository Credit Intermediation entities with 
$550 million or less in assets qualify as small businesses. Census data 
for 2012 indicate that 6 firms in this category operated throughout 
that year. Due to the nature of this category, the Commission concludes 
that a substantial number of businesses in this category are small 
under the SBA standard.
    78. Sales Financing. This industry comprises establishments 
primarily engaged in sales financing or sales financing in combination 
with leasing. Sales financing establishments are primarily engaged in 
lending money for the purpose of providing collateralized goods through 
a contractual installment sales agreement, either directly from or 
through arrangements with dealers. The SBA has determined that Sales 
Financing entities with $38.5 million or less in annual receipts 
qualify as small businesses. Census data for 2012 indicate that 2,093 
firms in this category operated throughout that year. Of those, 1,950 
operated with annual receipts of less than $25 million. The Commission 
concludes that a substantial majority of businesses in this category 
are small under the SBA standard.
    79. Consumer Lending. This U.S. industry comprises establishments 
primarily engaged in making unsecured cash loans to consumers. The SBA 
has determined that Consumer Lending entities with $38.5 million or 
less in annual receipts qualify as small businesses. Census data for 
2012 indicate that 2,768 firms in this category operated throughout 
that year. Of those, 2,702 operated with annual receipts of less than 
$25 million. The Commission concludes that a substantial majority of 
businesses in this category are small under the SBA standard.
    80. Real Estate Credit. This U.S. industry comprises establishments 
primarily engaged in lending funds with real estate as collateral. The 
SBA has determined that Real Estate Credit entities with $38.5 million 
or less in annual receipts qualify as small businesses. Census data for 
2012 indicate that 2,535 firms in this category operated throughout 
that year. Of those, 2,223 operated with annual receipts of less than 
$25 million. The Commission concludes that a substantial majority of 
businesses in this category are small under the SBA standard.
    81. International Trade Financing. This U.S. industry comprises 
establishments primarily engaged in providing one or more of the 
following: (1) Working capital funds to U.S. exporters; (2) lending 
funds to foreign buyers of U.S. goods; and/or (3) lending funds to 
domestic buyers of imported goods. The SBA has determined that 
International Trade Financing entities with $38.5 million or less in 
annual receipts qualify as small businesses. Census data for 2012 
indicate that 126 firms in this category operated throughout that year. 
Of those, 120 operated with annual receipts of less than $25 million. 
The Commission concludes that a substantial majority of businesses in 
this category are small under the SBA standard.
    82. Secondary Market Financing. This U.S. industry comprises 
establishments primarily engaged in buying, pooling, and repackaging 
loans for sale to others on the secondary market. The SBA has 
determined that Secondary Market Financing entities with $38.5 million 
or less in annual receipts qualify as small businesses. Census data for 
2012 indicate that 89 firms in this category operated throughout that 
year. Of those, 78 operated with annual receipts of less than $25 
million. The Commission concludes that a substantial majority of 
businesses in this category are small under the SBA standard.
    83. All Other Nondepository Credit Intermediation. This U.S. 
industry comprises establishments primarily engaged in providing 
nondepository credit (except credit card issuing, sales financing, 
consumer lending, real estate credit, international trade financing, 
and secondary market financing). Examples of types of lending in this 
industry are: Short-term inventory credit, agricultural lending (except 
real estate and sales financing), and consumer cash lending secured by 
personal property. The SBA has determined that All Other Nondepository 
Credit Intermediation entities with $38.5 million or less in annual 
receipts qualify as small businesses. Census data for 2012 indicate 
that 4,960 firms in this category operated throughout that year. Of 
those, 4,872 operated with annual receipts of less than $25 million. 
The Commission concludes that a substantial majority of businesses in 
this category are small under the SBA standard.
    84. Mortgage and Nonmortgage Loan Brokers. This industry comprises 
establishments primarily engaged in arranging loans by bringing 
borrowers and lenders together on a commission or fee basis. The SBA 
has determined that Mortgage and Nonmortgage Loan Brokers with $7.5 
million or less in annual receipts qualify as small businesses. Census 
data for 2012 indicate that 6,157 firms in this category operated 
throughout that year. Of those, 5,939 operated with annual receipts of 
less than $5 million. The Commission concludes that a substantial 
majority of businesses in this category are small under the SBA 
standard.
    85. Other Activities Related to Credit Intermediation. This 
industry comprises establishments primarily engaged in facilitating 
credit intermediation (except mortgage and loan brokerage; and 
financial transactions processing, reserve, and clearinghouse 
activities). The SBA has determined that Other Activities Related to 
Credit Intermediation entities with $20.5 million or less in annual 
receipts qualify as small businesses. Census data for 2012 indicate 
that 3,989 firms in this category operated throughout that year.

[[Page 80607]]

Of those, 3,860 operated with annual receipts of less than $20.5 
million. The Commission concludes that a substantial majority of 
businesses in this category are small under the SBA standard.

Description of Projected Reporting, Recordkeeping, and Other Compliance 
Requirements for Small Entities

    86. Document FCC 16-99 amends the Commission's rules implementing 
the TCPA to align them with the amended statutory language of the TCPA 
enacted by Congress in the 2015 Budget Act, creating an exception that 
allows the use of an autodialer, prerecorded-voice, and artificial-
voice when making calls to wireless telephone numbers without the prior 
express consent of the called party when such calls are made solely to 
collect a debt owed to or guaranteed by the United States, and imposing 
limitations on autodialed, prerecorded-voice, and artificial-voice 
calls to collect a debt owed to or guaranteed by the United States. 
Document FCC 16-99 will likely impose a one-time cost on some entities 
to set up new recordkeeping and other compliance requirements. These 
changes affect small and large companies equally, and apply equally to 
all of the classes of regulated entities identified above.
    87. To comply with the right of the consumer to stop autodialed, 
artificial-voice, and prerecorded-voice federal debt collection calls 
to wireless numbers without consent, regulated entities must keep a 
record of any request made by a consumer for the cessation of the 
calls, and must pass that information to any subsequent collector or 
servicer of the debt if the debt is transferred. This rule obligates 
callers to retain records of consumers opting out of receiving these 
autodialed or prerecorded federal debt collection messages. Because 
autodialed, artificial-voice, and prerecorded-voice federal debt 
collection calls to wireless numbers required consent prior to these 
amendments, the Commission assumes calling entities have systems and 
procedures already in place to record consent and that the current way 
of doing business will be sufficient for tracking revocation of consent 
and will not impose new costs. However, the requirement to inform 
subsequent collectors or servicers of the revocation of consent might 
be new for some calling entities, and could impose a small initial cost 
to modify systems or procedures. This provision does not impose a 
significant economic impact on small businesses. The Commission did not 
receive any comments stating that this rule would cause a significant 
economic impact on small businesses. The Commission does not require a 
particular form or format to be used in conveying the revocation of 
consent to subsequent collectors or servicers when a debt is 
transferred.
    88. Federal debt collection calls made using a prerecorded or 
artificial voice must include an automated, interactive voice- and/or 
key press-activated opt-out mechanism so that debtors who receive these 
calls may make a stop-calling request during the call by pressing a 
single key. When a federal debt collection call using an artificial 
voice or prerecorded voice leaves a voicemail message, that message 
must also provide a toll-free number that the debtor may call at a 
later time to connect directly to the automated, interactive voice and/
or key press-activated mechanism and automatically record the stop-
calling request. Text message disclosures must include brief 
explanatory instructions for sending a stop-call request by reply text 
message and provide a toll-free number that enables the debtor to call 
back later to make a stop-call request. This rule obligates callers to 
modify their systems to produce the message, maintain toll-free 
numbers, and record any stop-call requests. Such records should 
demonstrate the caller's compliance with the provision and utilization 
of the automated, interactive opt-out feature. The Commission allows 
the calling entities the flexibility to determine how to implement the 
mechanism. The Commission does not require a particular form or format 
evidencing this mechanism or its implementation. This provision does 
not impose a significant economic impact on small businesses. The 
Commission did not receive any comments stating that this rule would 
cause a significant economic impact on small businesses.

Steps Taken To Minimize the Significant Economic Impact on Small 
Entities, and Significant Alternatives Considered

    89. The RFA requires an agency to describe any significant 
alternatives that it has considered in reaching its approach, which may 
include the following four alternatives, among others: (1) The 
establishment of differing compliance or reporting requirements or 
timetables that take into account the resources available to small 
entities; (2) the clarification, consolidation, or simplification of 
compliance or reporting requirements under the rule for small entities; 
(3) the use of performance, rather than design, standards; and (4) an 
exemption from coverage of the rule, or any part thereof, for small 
entities.
    90. The amendments to the rules change the specific conditions 
under which a caller can use an autodialer, prerecorded voice, and 
artificial voice to make calls to a wireless number without the prior 
express consent of the called party and the limitations that apply to 
autodialed, prerecorded-voice, and artificial-voice calls to a wireless 
number made to collect a debt owed to or guaranteed by the United 
States. The limitations balance the importance of collecting debt owed 
to the United States and the consumer protections inherent in the TCPA. 
The Commission interprets the amendments as allowing such calls to be 
made by the federal government, owners of debt guaranteed by the 
federal government, and by their respective contractors. The amendments 
therefore benefit the federal government, owners of debt guaranteed by 
the federal government, and their respective contractors. Although the 
federal government is not a small business, many of the owners of debt 
guaranteed by the federal government and the contractors who make these 
calls are small businesses. Thus, the Commission considered the needs 
of small businesses in reaching its approach.
    91. Automated dialers and artificial-voice, and prerecorded-voice 
calling systems can be used to make thousands of calls without 
requiring commensurate staffing. By automating the process of making 
calls and texts, small businesses can make as many calls as large 
businesses. The volume of calls is not limited by the size of the 
business. Therefore limitations designed to protect consumer interests 
must apply to both large and small calling entities to be effective. 
The Commission believes that any economic burden these proposed rules 
may have on callers is outweighed by the benefits to consumers.
    92. Feedback. The Commission considered feedback from the 2016 NPRM 
in crafting the final order. Although none of the comments offered 
suggestions of ways to make the rules more friendly to small 
businesses, there were many comments from regulated callers with 
suggestions to make compliance easier for all, large and small. The 
Commission evaluated the comments in light of balancing the need to 
collect the debt with the need to protect consumer interests, and 
modified the proposed rules in several ways. For example, the 
Commission expanded the definition of the types of calls permitted to 
include debt servicing calls made following a specific, time-

[[Page 80608]]

sensitive events such as a recertification deadline or the end of a 
deferment period, and in the 30 days before such an event, rather than 
limiting the exception to calls made when the debt is delinquent or in 
default. Similarly, the Commission expanded the reach of the exception 
by allowing covered calls to be made to a phone number subsequently 
provided by the debtor to the servicer or owner of the debt, or a 
number obtained from an independent source, rather than limiting calls 
to the number provided on the loan application. These changes benefit 
regulated entities of all sizes.
    93. Timetables. The Commission does not see a need to establish a 
special timetable for small entities to reach compliance with the 
modification to the rules. No small business has asked for a delay in 
implementing the rules.
    94. Reporting requirements; performance standards. Since the rule 
does not impose reporting requirements, there is no need to establish 
less burdensome reporting requirements for small businesses. Similarly, 
there are no design standards or performance standards to consider in 
this rulemaking.
    95. Exemption. The Commission does not see a need to consider an 
exemption for small businesses from the modified rules. No small 
business has asked for such an exemption.

Congressional Review Act

    The Commission will send a copy of document FCC 16-99 to 
Congress and the Government Accountability Office pursuant to the 
Congressional Review Act, see 5 U.S.C. 801(a)(1)(A).

Final Paperwork Reduction Act of 1995 Analysis

    Document FCC 16-99 contains modified information collection 
requirements. The Commission, as part of its continuing effort to 
reduce paperwork burdens, will invite the general public to comment 
on the information collection requirements contained in document FCC 
16-99 as required by the Paperwork Reduction Act (PRA) of 1995, 
Public Law 104-13. In addition, the Commission notes that, pursuant 
to the Small Business Paperwork Relief Act of 2002, Public Law 107-
198, 44 U.S.C. 3506(c)(4), the Commission previously sought comment 
on how the Commission might ``further reduce the information burden 
for small business concerns with fewer than 25 employees.'' See 
Rules and Regulations Implementing the Telephone Consumer Protection 
Act of 1991, Notice of Proposed Rulemaking, published at 81 FR 
31889, May 20, 2016 (2016 NPRM).

List of Subjects in 47 CFR Part 64

    Claims, Communications common carriers, Credit, Reporting and 
recordkeeping requirements, Telecommunications, and Telephone.

Federal Communications Commission.
Marlene H. Dortch,
Secretary.
[FR Doc. 2016-24745 Filed 11-15-16; 8:45 am]
 BILLING CODE 6712-01-P