Internet Protocol Relay Service Compensation Methodology, 64440-64444 [2021-24945]

Download as PDF 64440 Federal Register / Vol. 86, No. 220 / Thursday, November 18, 2021 / Proposed Rules levels to align with the Washington State Legislature’s statutory changes focused on the more recent 24-hour PM2.5 NAAQS and expanding the burn ban applicability beyond the former Woodsmoke Control Zone. The EPA is also proposing to determine that Regulation 1, sections 3.04 Wood Heaters and 3.05 Burn Bans, adopted by YRCAA effective November 9, 2020 are consistent with section 110 of the Clean Air Act. The EPA is soliciting public comments on YRCAA Regulation 1, sections 3.04 Wood Heaters and 3.05 Burn Bans which will be considered before taking final action. We are also proposing to remove from the SIP the outdated 1993 and 1995 Article IX provisions Woodstoves and Fireplaces, which are replaced by sections 3.04 and 3.05. We note that the October 14, 2021 submission also includes outdoor burning regulations and other general air quality regulations which the EPA will address in separate actions. khammond on DSKJM1Z7X2PROD with PROPOSALS IV. Incorporation by Reference In this document, the EPA is proposing to include in a final rule, regulatory text that includes incorporation by reference. In accordance with requirements of 1 CFR 51.5, the EPA is proposing to incorporate by reference YRCAA Regulation 1, sections 3.04 and 3.05 discussed in section III of this preamble and remove from the incorporation by reference YRCAA Regulation 1, Article IX which is replaced by sections 3.04 and 3.05. The EPA has made, and will continue to make, these documents generally available through https:// www.regulations.gov and at the EPA Region 10 Office (please contact the person identified in the FOR FURTHER INFORMATION CONTACT section of this preamble for more information). V. Statutory and Executive Order Reviews Under the Clean Air Act, the Administrator is required to approve a SIP submission that complies with the provisions of the Clean Air Act and applicable Federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in reviewing SIP submissions, the EPA’s role is to approve State choices, provided that they meet the criteria of the Clean Air Act. Accordingly, this proposed action merely approves State law as meeting Federal requirements and does not impose additional requirements beyond those imposed by State law. For that reason, this proposed action: • Is not a ‘‘significant regulatory action’’ subject to review by the Office of Management and Budget under VerDate Sep<11>2014 16:27 Nov 17, 2021 Jkt 256001 Executive Orders 12866 (58 FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 2011); • Does not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.); • Is certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.); • Does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104–4); • Does not have federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999); • Is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997); • Is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001); • Is not subject to requirements of Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) because application of the requirements would be inconsistent with the Clean Air Act; and • Does not provide the EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994). In addition, this proposed action would not apply on any Indian reservation land or in any other area where the EPA or an Indian tribe has demonstrated that a tribe has jurisdiction. In those areas of Indian country, the rule does not have tribal implications as specified by Executive Order 13175 (65 FR 67249, November 9, 2000). Consistent with EPA policy, the EPA provided an opportunity to request consultation to the Confederated Tribes and Bands of the Yakama Nation in a letter dated April 5, 2021. List of Subjects in 40 CFR Part 52 Environmental protection, Air pollution control, Carbon monoxide, Incorporation by reference, Intergovernmental relations, Lead, Nitrogen dioxide, Ozone, Particulate matter, Reporting and recordkeeping requirements, Sulfur oxides, Volatile organic compounds. PO 00000 Frm 00033 Fmt 4702 Sfmt 4702 Dated: November 9, 2021. Michelle L. Pirzadeh, Acting Regional Administrator, Region 10. [FR Doc. 2021–25042 Filed 11–17–21; 8:45 am] BILLING CODE 6560–50–P FEDERAL COMMUNICATIONS COMMISSION 47 CFR Part 64 [CG Docket No. 03–123; RM–11820; FCC 21–95; FR ID 57163] Internet Protocol Relay Service Compensation Methodology Federal Communications Commission. ACTION: Proposed rule. AGENCY: In this document, the Federal Communications Commission (FCC or Commission) proposes to modify the methodology for determining compensation for the provision of internet Protocol Relay (IP Relay) service and seeks comments on modifying the formula for determining the per-minute compensation for providers of IP Relay to ensure Interstate TRS Fund support is sufficient to sustain a functionally equivalent telephone service. DATES: Comments are due December 20, 2021; reply comments are due January 18, 2022. ADDRESSES: You may submit comments, identified by CG Docket No. 03–123 and RM–11820, by either of the following methods: • Federal Communications Commission’s Website: https:// www.fcc.gov/ecfs/filings. Follow the instructions for submitting comments. • Paper Filers: Parties who choose to file by paper must file an original and one copy of each filing. Filings can be sent by hand or messenger delivery, by commercial overnight courier, or by first-class or overnight U.S. Postal Service mail. Currently, the Commission does not accept any hand delivered or messenger delivered filings as a temporary measure taken to help protect the health and safety of individuals, and to mitigate the transmission of COVID– 19. All filings must be addressed to the Commission’s Secretary, Office of the Secretary, Federal Communications Commission. For detailed instructions on submitting comments and additional information on the rulemaking process, see document FCC 21–95 at: https:// docs.fcc.gov/public/attachments/FCC21-95A1.pdf. FOR FURTHER INFORMATION CONTACT: William Wallace, Consumer and SUMMARY: E:\FR\FM\18NOP1.SGM 18NOP1 khammond on DSKJM1Z7X2PROD with PROPOSALS Federal Register / Vol. 86, No. 220 / Thursday, November 18, 2021 / Proposed Rules Governmental Affairs Bureau, at 202– 418–2716, or William.Wallace@fcc.gov. SUPPLEMENTARY INFORMATION: This is a summary of the Commission’s Notice of Proposed Rulemaking (Notice), document FCC 21–95, adopted on August 5, 2021, released on August 6, 2021, in CG Docket No. 03–123 and RM–11820. The full text of document FCC 21–95 is available for public inspection and copying via the Commission’s Electronic Comment Filing System (ECFS). 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. This proceeding shall be treated as a ‘‘permit-but-disclose’’ proceeding in accordance with the Commission’s ex parte rules. 47 CFR 1.1200 et seq. Persons making ex parte presentations must file a copy of any written presentation or a memorandum summarizing any oral presentation within two business days after the presentation (unless a different deadline applicable to the Sunshine period applies). Persons making oral ex parte presentations are reminded that memoranda summarizing the presentation must (1) list all persons attending or otherwise participating in the meeting at which the ex parte presentation was made, and (2) summarize all data presented and arguments made during the presentation. If the presentation consisted in whole or in part of the presentation of data or arguments already reflected in the presenter’s written comments, memoranda or other filings in the proceeding, the presenter may provide citations to such data or arguments in his or her prior comments, memoranda, or other filings (specifying the relevant page and/or paragraph numbers where such data or arguments can be found) in lieu of summarizing them in the memorandum. Documents shown or given to Commission staff during ex parte meetings are deemed to be written ex parte presentations and must be filed consistent with § 1.1206(b). In proceedings governed by § 1.49(f) or for which the Commission has made available a method of electronic filing, written ex parte presentations and memoranda summarizing oral ex parte presentations, and all attachments thereto, must be filed through the electronic comment filing system available for that proceeding, and must be filed in their native format (e.g., .doc, VerDate Sep<11>2014 16:27 Nov 17, 2021 Jkt 256001 .xml, .ppt, searchable .pdf). Participants in this proceeding should familiarize themselves with the Commission’s ex parte rules. Initial Paperwork Reduction Act of 1995 Analysis The Notice in document FCC 21–95 seeks comment on proposed rule amendments to the compensation methodology that may result in modified information collection requirements. If the Commission adopts any modified information collection requirements, the Commission will publish another document in the Federal Register inviting the public to comment on the requirements, as required by the Paperwork Reduction Act. Public Law 104–13; 44 U.S.C. 3501–3520. In addition, pursuant to the Small Business Paperwork Relief Act of 2002, the Commission seeks comment on how it might further reduce the information collection burden for small business concerns with fewer than 25 employees. Public Law 107–198; 44 U.S.C. 3506(c)(4). Synopsis 1. In document FCC 21–95, the Commission proposes to modify the methodology for setting compensation for IP Relay, a form of Telecommunications Relay Service (TRS). 2. With IP Relay, an individual with a hearing or speech disability can communicate with voice telephone users by transmitting text via the internet. The text transmission is delivered to an IP Relay call center, where a communications assistant (CA) converts the user’s text to speech for the hearing party and converts that party’s speech to text for the IP Relay user. 3. IP Relay is supported by the TRS Fund in accordance with a methodology approved by the Commission in 2007. A base level of per-minute compensation is approved based on the weighted average of providers’ reasonable costs and remains effective for a three-year period. In addition, an adjustment factor is set to be applied to the base amount to determine per-minute compensation for the second and third years, which reflects an increase due to inflation, offset by a decrease due to cost efficiencies. The base compensation amount also is subject to upward adjustment to account for exogenous costs, i.e., those costs beyond the control of the IP Relay providers that are not reflected in the inflation adjustment. At the end of each three-year period, the base compensation level is reset based on average provider costs. The current PO 00000 Frm 00034 Fmt 4702 Sfmt 4702 64441 compensation period runs from July 1, 2019, to June 30, 2022. 4. Since 2007, there have been substantial changes in the circumstances relevant to TRS Fund support of IP Relay. In 2013 and 2014, four of the five IP Relay providers exited the market, and IP Relay demand declined precipitously. After November 2014, Sprint Corporation (now T-Mobile USA, Inc.) was the sole provider of IP Relay service, and demand stabilized. 5. In response to these developments, the Consumer and Governmental Affairs Bureau (CGB or Bureau) has taken a number of steps to ensure that TRS Fund support for IP Relay was sufficient to sustain the service and allow the remaining provider to ascertain and meet the needs of consumers relying on it for functionally equivalent telephone service. 6. In 2016, the Bureau partially waived the Commission rule prohibiting TRS Fund support of IP Relay providerdirected outreach activities to allow TMobile to effectively educate deafblind consumers about its service and solicit feedback on how to improve it. The Bureau renewed this waiver in subsequent years. 7. In 2019, the Bureau allowed recovery of an operating margin, determined as a percentage of annual expenses, in lieu of the rate of return on capital investment previously allowed. In renewing the previously granted waiver permitting provider recovery of expenses for outreach to the deafblind community, the Bureau expanded the scope of that waiver to include outreach to other potential users of this service. 8. In November 2018, Sprint (now TMobile) filed a petition for rulemaking requesting a new compensation methodology. The company proposed that the Commission adopt a new approach based substantially on the Multi-State Average Rate Structure (MARS) compensation plan for TTYbased TRS offered through state TRS programs. 9. The Commission proposes to amend the compensation rules for IP Relay to take account of the changed environment in which this service is provided. The Commission believes it should continue the practice of periodically re-setting the compensation level based on determinations of reasonable provider cost. As the Commission explained last year when setting compensation for internet Protocol Captioned Telephone Service (IP CTS) in the IP CTS Compensation Methodology Order, published at 85 FR 64971, October 14, 2020, over a long period ‘‘the Commission has developed a consistent approach to determining E:\FR\FM\18NOP1.SGM 18NOP1 64442 Federal Register / Vol. 86, No. 220 / Thursday, November 18, 2021 / Proposed Rules khammond on DSKJM1Z7X2PROD with PROPOSALS the reasonable costs of providing TRS, which can be applied without imposing undue administrative burdens on either providers or the Commission.’’ Further, ‘‘[a]lthough any ratemaking method is subject to imprecision, provider cost data, which is subject to audit, has been reasonably reliable and consistent,’’ and ‘‘the Commission’s determinations regarding allowability of costs are solidly reasoned and have been upheld on judicial review.’’ The Commission seeks comment on whether these general observations continue to hold true for IP Relay. 10. The Commission proposes to continue setting the compensation level for a multi-year period, subject to annual adjustment based on predetermined factors. The Commission proposes a number of changes in how reasonable costs are determined, and seeks comment on whether to change the specific duration of the compensation period and on the appropriate criteria for annual adjustment of the compensation level, as well as other aspects of the methodology. The Commission seeks comment on which specific aspects of the cost-based approach have been problematic in the IP Relay context and how they could be improved. The Commission seeks additional comment on the MARS-based alternative proposed in T-Mobile’s petition for rulemaking, and invites commenters to suggest additional alternative compensation methodologies. Benefits of IP Relay 11. The Commission seeks granular information on which segments of the TRS-eligible population primarily use and benefit from this service. How many deafblind individuals use IP Relay and how many minutes of use do they represent? The Commission seeks comment on the best way to determine or estimate these numbers. What features of IP Relay are critical for this customer segment? What proportion of IP Relay users represent people who became deaf or hard of hearing early in life, and are unable to use VRS because they do not know ASL? To what extent is IP Relay used to make 911 calls, and what advantages does it offer in this regard? To what extent do other forms of TRS (or other communications services, such as real-time text) provide an effective substitute to IP Relay for individuals who might otherwise rely on the service as their sole or primary means of telephone communication? To what extent do people who lose hearing later in life find IP Relay beneficial, despite the availability of other options, such as IP CTS? Would a person with VerDate Sep<11>2014 16:27 Nov 17, 2021 Jkt 256001 close to 100% hearing loss find IP Relay preferable to IP CTS? Would such a preference depend on how much an individual’s speech is affected, or other factors? The Commission seeks comment on whether there has been enough outreach and education to the deafblind community by the Commission and TRS providers and whether more is needed. Would increased outreach and education to the deafblind community regarding the availability and merits of each type of TRS increase legitimate demand for IP Relay? Allowable Expenses 12. The Commission has made a number of determinations, both for TRS generally and for specific relay services, as to whether various categories of costs are allowable for recovery from the TRS Fund as reasonable costs of providing TRS. The Commission seeks comment on possible amendments to the allowable cost rules. 13. Outreach. The Commission proposes to rescind the current prohibition on outreach recovery by IP Relay providers and seeks comment on this proposal, its costs and benefits, and the underlying rationale stated below. 14. First, CGB has found that in the absence of competition, providing economic incentive for outreach and education by the sole service provider may be critical to effectively educate consumers—including consumers who are deafblind and others—regarding the availability of and improvements to the service. The Commission invites comment on the extent to which outreach for this purpose continues to be needed and the resulting benefits. 15. Second, with only one IP Relay provider, the Commission believes that provider outreach expenditures in this context are more likely to be focused appropriately on educating existing and potential IP Relay users about the service rather than on encouraging or preventing ‘‘churn’’ among existing customers, would therefore be more effective for their intended purpose than when the outreach ban was adopted, and would not likely duplicate other outreach efforts. Finally, a review of the outreach reports submitted by T-Mobile in response to the resumption of compensated outreach activity has not shown that they are misdirected toward ineligible users. Therefore, the Commission does not believe such efforts would contribute to a recurrence of the kind of misuse of IP Relay that occurred prior to 2015. The Commission seeks comment on these assumptions. 16. The Commission seeks comment on whether to limit allowable outreach PO 00000 Frm 00035 Fmt 4702 Sfmt 4702 expenses to a specified percentage or amount, and, if so, what percentage or amount should be allowed. How should the Commission measure the effectiveness of outreach efforts—based on the number of new users or on some other basis? Should the Commission continue to require the filing of regular reports to ensure that outreach expenses are beneficial and effectively educating consumers about IP Relay service, and if so, on what schedule? Should the Commission continue to require separate reporting of general and deafblind outreach activities and the associated costs? 17. Indirect Overhead. The Commission seeks comment on whether to modify, with respect to IP Relay, the Commission’s rule allowing recovery for only those overhead costs directly related to and directly supporting the provision of relay service and whether there is a continuing need for this rule in the IP Relay context. 18. First, is the current rule effectively mandated by section 225 of the Communications Act of 1934, as amended? 47 U.S.C. 225. Given that only some current providers of TRS are common carriers, does the Commission have more flexibility in determining what costs are reasonable? 19. Second, the Commission seeks comment on the cost-effectiveness of the current rule, relative to alternatives, notably allowing a reasonable contribution toward overhead costs. To what extent is it feasible for a multiservice provider to track administrative costs directly, to the extent they are attributable to the provision of TRS? Is it unduly burdensome to require a demonstration of cost causation for such costs, e.g., by maintaining time records for staff time attributable to IP Relay? What specific kinds of administrative costs that are not currently recoverable would be recovered if allocation of overhead were permitted? The Commission seeks comment on whether there are circumstances specific to the current context of IP Relay, such as the presence of only one provider, that make the rule more burdensome or less appropriate for application to this service, compared to other forms of TRS? How much would allowing support for such costs increase perminute IP Relay compensation? Is there any risk T-Mobile would abandon TRS if it continued to receive no contribution to overheads but continued to be fully compensated for all costs attributed to TRS? 20. If the Commission were to allow recovery of overhead costs, i.e., administrative costs not directly attributable to TRS, how should such E:\FR\FM\18NOP1.SGM 18NOP1 Federal Register / Vol. 86, No. 220 / Thursday, November 18, 2021 / Proposed Rules costs be allocated—based on the percentage of total revenues derived from IP Relay, percentage of total company costs, or by some other method? How could the Commission or Fund administrator effectively audit such allocations? 21. Other Allowable Costs. Are there other costs incurred in the provision of IP Relay that the Commission’s methodology should allow? khammond on DSKJM1Z7X2PROD with PROPOSALS Operating Margin 22. The Commission proposes to amend its compensation rules to affirm that the IP Relay compensation level should include an operating margin— i.e., an allowance for recovery of a designated percentage of allowed expenses, in lieu of return on investment. The Commission seeks comment on this proposal and its costeffectiveness. 23. The Commission seeks comment on what percentage of allowable expenses constitutes a reasonable operating margin for IP Relay. By what criteria should the allowed operating margin be determined? Is business risk assessment an appropriate measure for setting the operating margin for IP Relay? Due to the level of business risk, or for other reasons, should the operating margin for IP Relay be different from that for other forms of TRS? Is the operating margin of 12.35%, determined by the Bureau in 2019, a reasonable margin going forward, or should a different allowed margin be selected? Have there been recent changes in capital markets that would support increasing or decreasing this margin? The Commission seeks comment on whether future determinations of an operating margin for IP Relay should be made by the Commission itself or could be delegated to the Bureau. Projected Versus Historical Costs 24. The Commission proposes to return to the pre-2019 practice of using only projected costs and demand as the basis for calculating the base compensation level for IP Relay and seeks comment on this proposal and its cost-effectiveness relative to other approaches. The Commission invites the submission of evidence regarding the likelihood that the current level of cost increases in IP Relay are likely to continue or to prove to be a temporary phenomenon. Compensation Period and Adjustments 25. Duration of Compensation Period. The Commission proposes to continue setting IP Relay compensation for a multi-year period and seeks comment VerDate Sep<11>2014 16:27 Nov 17, 2021 Jkt 256001 on this proposal and whether it will provide benefits in the IP Relay context. 26. Assuming that the Commission continues setting compensation for a multi-year period, should the duration continue to be three years? A longer compensation period, such as four or five years, would potentially offer a provider greater certainty for the purpose of long-term planning and allow retention of a larger portion of any profits produced by efficiency improvements—as well as reducing the administrative burden for the provider and the Commission. Would these benefits outweigh the risks posed by the potential for unpredicted cost increases or fall-off in demand? Alternatively, would a shorter period be preferable, to address cost predictability concerns, while retaining some of the benefit of a multi-year plan? The Commission seeks comment on the extent to which a compensation period of longer than three years would make a material difference to such firms’ capacity to provide and improve IP Relay service. Recognizing that, if over a given compensation period, costs were to rise substantially, and providers would have strong incentives to present a robust petition explaining their need, and thus obtain relief, to what extent would any benefits of a longer compensation period justify the risks of overcompensation that would occur if costs were to fall significantly over the period? 27. Are IP Relay costs sufficiently predictable to warrant setting a base compensation amount for a multi-year period? Alternatively, is the variability in IP Relay costs sufficiently unpredictable that the Commission should reassess the IP Relay compensation level annually? The Commission seeks comment on the costeffectiveness of this alternative approach relative to the current approach or other alternative approaches. Would the resulting yearto-year uncertainty and reduced incentives for efficiency and innovation be outweighed by the greater flexibility to ensure full cost recovery in response to unpredicted cost and demand changes? Are there net benefits of this alternative that would outweigh any increased administrative burden on the provider and the Commission? 28. The Commission also seeks comment on whether compensation decisions based on cost determinations, whether made annually or at longer intervals, should be made by the full Commission, or by the Bureau under delegated authority. Further, should other decisions—e.g., approval of annual changes based on preset PO 00000 Frm 00036 Fmt 4702 Sfmt 4702 64443 adjustment factors, determinations regarding exogenous cost claims, and grant or denial of requests for waiver of compensation rules—be made at the Commission or Bureau level? 29. Compensation Adjustments During a Multi-Year Period. If the Commission continues setting IP Relay compensation for a multi-year period, it seeks comment on whether to continue the current practice of adjusting the compensation level in subsequent years of the cycle, and if so, whether to modify the criteria for such adjustments. 30. Inflation Adjustment. Should the Commission continue to apply an annual inflation adjustment to the base compensation level, and if so, how should the adjustment be determined? The current methodology uses an inflation factor based on the Gross Domestic Product—Price Index (GDP– PI) to adjust the compensation level upward. Is the GDP–PI a reasonably accurate predictor of inflation in IP Relay costs? Would another price index provide a better measure? For example, because IP Relay is currently a laborintensive service, should the Commission select a measure from the Bureau of Labor Statistics’ (BLS) Employment Cost Index: Historical Listing Volume III (April 2021), available at https://www.bls.gov/web/ eci/echistrynaics.pdf, which tracks measures of labor cost for various industry segments—for example, the seasonally-adjusted ‘‘office and administrative support,’’ ‘‘serviceproviding industries,’’ ‘‘other services except public administration,’’ or the non-seasonally-adjusted ‘‘office and administrative support,’’ indices? Which measure or measures of inflation in this index would be most appropriate for IP Relay? Is there another general or sector-specific cost index that would more accurately predict changes in IP Relay cost? 31. Efficiency Adjustment. The Commission also established an efficiency factor, used to adjust the compensation level in a downward direction to reflect expected productivity improvements. The Commission seeks comment on how best to measure expected efficiency gains for this particular service. What are the potential sources of annual efficiency gains in IP Relay, and how should the extent of annual efficiency gains be estimated? Alternatively, should the Commission eliminate the efficiency factor? 32. Exogenous Costs. The IP Relay base compensation level can be adjusted upward to permit recovery of exogenous costs, which are ‘‘costs beyond the control of the IP Relay providers that are E:\FR\FM\18NOP1.SGM 18NOP1 64444 Federal Register / Vol. 86, No. 220 / Thursday, November 18, 2021 / Proposed Rules khammond on DSKJM1Z7X2PROD with PROPOSALS not reflected in the inflation adjustment,’’ such as a new service requirement adopted by the Commission. Should the Commission retain this aspect of the methodology? If so, are there other types of exogenous costs that warrant inclusion? Should the Commission broaden the definition of exogenous costs? Should the Commission apply the allowable cost criteria adopted in the 2017 VRS Compensation Order, published at 82 FR 39673, August 22, 2017, which allow upward compensation adjustment for well-documented exogenous costs that (1) belong to a category of costs that the Commission has deemed allowable, (2) result from new TRS requirements or other causes beyond the provider’s control, (3) are new costs that were not factored into the applicable compensation rates, and (4) if unrecovered, would cause a provider’s current allowable-expenses-plusoperating margin to exceed its revenues? 33. Other Adjustments. In addition to adjustments for inflation, efficiency, and exogenous costs, are there other types of adjustments to the IP Relay compensation level that the Commission should be making in subsequent years of a multi-year rate cycle? MARS compensation approach as a starting point for setting IP Relay compensation, and believes that attempting to revert to a version of the MARS methodology would likely result in significant overcompensation for IP Relay, wasting TRS funds. The Commission also is not persuaded that T-Mobile’s proposed methodology would be any less difficult to apply or subject to inaccuracy than the current methodology, and T-Mobile’s proposal appears inconsistent with recent Commission precedent. The Commission seeks comment on the concerns stated above. Are there other factors that merit consideration of TMobile’s proposal? Would the hybrid MARS approach better serve the compensation-setting policy goals articulated above? 37. Other Methodologies. Are there other compensation methodologies that the Commission should consider for IP Relay to achieve its policy goals? Initial Regulatory Flexibility Analysis 38. As required by the Regulatory Flexibility Act of 1980, as amended (RFA), the Commission has prepared this Initial Regulatory Flexibility Analysis (IRFA) of the possible significant economic impact on a substantial number of small entities by Alternative Compensation the policies and rules proposed in the Methodologies Notice. Written public comments are 34. Hybrid MARS Approach. T-Mobile requested on this IRFA. Comments must proposes that in setting a new IP Relay be identified as responses to the IRFA compensation level, the Commission and must be filed by the deadline for should take as a starting point the percomments on the Notice provided in the minute compensation for interstate item. The Commission will send a copy TTY-based TRS, which is currently set of the entire Notice, including this using the MARS method. The IRFA, to the Chief Counsel for Advocacy Commission would multiply the average of the Small Business Administration per-minute rate of TTY-based TRS (SBA). compensation by the projected number Need for, and Objectives of the of IP Relay minutes, subtract those Proposed Rules provider costs that are incurred only in providing TTY-based TRS, and add 39. In the Notice, the Commission costs that are incurred only in providing proposes to reform the compensation IP Relay. The resulting funding methodology for IP Relay. To develop a requirement would be divided by complete record, the Commission seeks projected IP Relay demand to determine comment on whether and how to the per-minute compensation level. modify the process for setting projected35. The Commission invites advocates cost-based IP Relay compensation, of this approach to identify the specific including whether certain costs that are categories of costs they believe would be currently not allowed should be appropriate to add and subtract to compensable, the methodology for achieve an appropriate per-minute calculating the compensation amount, compensation level using such a hybrid and alternative approaches. The MARS methodology. Which categories Commission takes these steps to allow of TTY-based TRS costs, specifically, recovery of reasonable provider costs are not incurred to provide IP Relay, and ensure that functionally equivalent which categories of IP Relay costs are IP Relay is provided in the most not incurred to provide TTY-based TRS, efficient manner. and what are the estimated current costs Legal Basis in each of those categories? 40. The authority for this proposed 36. The Commission is unpersuaded rulemaking is contained in sections 1, 2, that it would be appropriate to use a VerDate Sep<11>2014 16:27 Nov 17, 2021 Jkt 256001 PO 00000 Frm 00037 Fmt 4702 Sfmt 9990 and 225 of the Communications Act of 1934, as amended, 47 U.S.C. 151, 152, 225. Small Entities Impacted 41. The proposals in the document FCC 21–95 will affect the obligations of IP Relay providers. These services can be included within the broad economic category of All Other Telecommunications. Description of Projected Reporting, Recordkeeping, and Other Compliance Requirements 42. The proposed compensation methodology will not create new reporting, recordkeeping, or other compliance requirements. Steps Taken To Minimize Significant Impact on Small Entities, and Significant Alternatives Considered 43. Throughout the Notice, the Commission is (1) taking steps to minimize the impact on small entities by proposing reforms to the IP Relay compensation methodology that would ensure that providers of IP Relay are fairly compensated for the provision of IP Relay, including considering significant alternatives by identifying and seeking comment on multiple methodologies for compensation; and (2) considering various options to determine the best compensation methodology for ensuring functionally equivalent service and maintaining an efficient IP Relay market over the long term in accordance with the Commission’s statutory obligations. The Notice seeks comment on the effect these proposals will have on all entities that have the potential to provide IP Relay, including small entities. 44. The Notice seeks comment from all interested parties. Small entities are encouraged to bring to the Commission’s attention any specific concerns they may have with the proposals outlined in the Notice. The Commission expects to consider the economic impact on small entities, as identified in comments filed in response to the Notice, in reaching its final conclusions and acting in this proceeding. Federal Rules Which Duplicate, Overlap, or Conflict With, the Commission’s Proposals 45. None. Federal Communications Commission. Marlene Dortch, Secretary, Office of the Secretary. [FR Doc. 2021–24945 Filed 11–17–21; 8:45 am] BILLING CODE 6712–01–P E:\FR\FM\18NOP1.SGM 18NOP1

Agencies

[Federal Register Volume 86, Number 220 (Thursday, November 18, 2021)]
[Proposed Rules]
[Pages 64440-64444]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-24945]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 64

[CG Docket No. 03-123; RM-11820; FCC 21-95; FR ID 57163]


Internet Protocol Relay Service Compensation Methodology

AGENCY: Federal Communications Commission.

ACTION: Proposed rule.

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SUMMARY: In this document, the Federal Communications Commission (FCC 
or Commission) proposes to modify the methodology for determining 
compensation for the provision of internet Protocol Relay (IP Relay) 
service and seeks comments on modifying the formula for determining the 
per-minute compensation for providers of IP Relay to ensure Interstate 
TRS Fund support is sufficient to sustain a functionally equivalent 
telephone service.

DATES: Comments are due December 20, 2021; reply comments are due 
January 18, 2022.

ADDRESSES: You may submit comments, identified by CG Docket No. 03-123 
and RM-11820, by either of the following methods:
     Federal Communications Commission's Website: https://www.fcc.gov/ecfs/filings. Follow the instructions for submitting 
comments.
     Paper Filers: Parties who choose to file by paper must 
file an original and one copy of each filing. Filings can be sent by 
hand or messenger delivery, by commercial overnight courier, or by 
first-class or overnight U.S. Postal Service mail. Currently, the 
Commission does not accept any hand delivered or messenger delivered 
filings as a temporary measure taken to help protect the health and 
safety of individuals, and to mitigate the transmission of COVID-19. 
All filings must be addressed to the Commission's Secretary, Office of 
the Secretary, Federal Communications Commission.
    For detailed instructions on submitting comments and additional 
information on the rulemaking process, see document FCC 21-95 at: 
https://docs.fcc.gov/public/attachments/FCC-21-95A1.pdf.

FOR FURTHER INFORMATION CONTACT: William Wallace, Consumer and

[[Page 64441]]

Governmental Affairs Bureau, at 202-418-2716, or 
[email protected].

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Notice 
of Proposed Rulemaking (Notice), document FCC 21-95, adopted on August 
5, 2021, released on August 6, 2021, in CG Docket No. 03-123 and RM-
11820. The full text of document FCC 21-95 is available for public 
inspection and copying via the Commission's Electronic Comment Filing 
System (ECFS).
    To request materials in accessible formats for people with 
disabilities (Braille, large print, electronic files, audio format), 
send an email to [email protected] or call the Consumer and Governmental 
Affairs Bureau at (202) 418-0530.
    This proceeding shall be treated as a ``permit-but-disclose'' 
proceeding in accordance with the Commission's ex parte rules. 47 CFR 
1.1200 et seq. Persons making ex parte presentations must file a copy 
of any written presentation or a memorandum summarizing any oral 
presentation within two business days after the presentation (unless a 
different deadline applicable to the Sunshine period applies). Persons 
making oral ex parte presentations are reminded that memoranda 
summarizing the presentation must (1) list all persons attending or 
otherwise participating in the meeting at which the ex parte 
presentation was made, and (2) summarize all data presented and 
arguments made during the presentation. If the presentation consisted 
in whole or in part of the presentation of data or arguments already 
reflected in the presenter's written comments, memoranda or other 
filings in the proceeding, the presenter may provide citations to such 
data or arguments in his or her prior comments, memoranda, or other 
filings (specifying the relevant page and/or paragraph numbers where 
such data or arguments can be found) in lieu of summarizing them in the 
memorandum. Documents shown or given to Commission staff during ex 
parte meetings are deemed to be written ex parte presentations and must 
be filed consistent with Sec.  1.1206(b). In proceedings governed by 
Sec.  1.49(f) or for which the Commission has made available a method 
of electronic filing, written ex parte presentations and memoranda 
summarizing oral ex parte presentations, and all attachments thereto, 
must be filed through the electronic comment filing system available 
for that proceeding, and must be filed in their native format (e.g., 
.doc, .xml, .ppt, searchable .pdf). Participants in this proceeding 
should familiarize themselves with the Commission's ex parte rules.

Initial Paperwork Reduction Act of 1995 Analysis

    The Notice in document FCC 21-95 seeks comment on proposed rule 
amendments to the compensation methodology that may result in modified 
information collection requirements. If the Commission adopts any 
modified information collection requirements, the Commission will 
publish another document in the Federal Register inviting the public to 
comment on the requirements, as required by the Paperwork Reduction 
Act. Public Law 104-13; 44 U.S.C. 3501-3520.
    In addition, pursuant to the Small Business Paperwork Relief Act of 
2002, the Commission seeks comment on how it might further reduce the 
information collection burden for small business concerns with fewer 
than 25 employees. Public Law 107-198; 44 U.S.C. 3506(c)(4).

Synopsis

    1. In document FCC 21-95, the Commission proposes to modify the 
methodology for setting compensation for IP Relay, a form of 
Telecommunications Relay Service (TRS).
    2. With IP Relay, an individual with a hearing or speech disability 
can communicate with voice telephone users by transmitting text via the 
internet. The text transmission is delivered to an IP Relay call 
center, where a communications assistant (CA) converts the user's text 
to speech for the hearing party and converts that party's speech to 
text for the IP Relay user.
    3. IP Relay is supported by the TRS Fund in accordance with a 
methodology approved by the Commission in 2007. A base level of per-
minute compensation is approved based on the weighted average of 
providers' reasonable costs and remains effective for a three-year 
period. In addition, an adjustment factor is set to be applied to the 
base amount to determine per-minute compensation for the second and 
third years, which reflects an increase due to inflation, offset by a 
decrease due to cost efficiencies. The base compensation amount also is 
subject to upward adjustment to account for exogenous costs, i.e., 
those costs beyond the control of the IP Relay providers that are not 
reflected in the inflation adjustment. At the end of each three-year 
period, the base compensation level is reset based on average provider 
costs. The current compensation period runs from July 1, 2019, to June 
30, 2022.
    4. Since 2007, there have been substantial changes in the 
circumstances relevant to TRS Fund support of IP Relay. In 2013 and 
2014, four of the five IP Relay providers exited the market, and IP 
Relay demand declined precipitously. After November 2014, Sprint 
Corporation (now T-Mobile USA, Inc.) was the sole provider of IP Relay 
service, and demand stabilized.
    5. In response to these developments, the Consumer and Governmental 
Affairs Bureau (CGB or Bureau) has taken a number of steps to ensure 
that TRS Fund support for IP Relay was sufficient to sustain the 
service and allow the remaining provider to ascertain and meet the 
needs of consumers relying on it for functionally equivalent telephone 
service.
    6. In 2016, the Bureau partially waived the Commission rule 
prohibiting TRS Fund support of IP Relay provider-directed outreach 
activities to allow T-Mobile to effectively educate deafblind consumers 
about its service and solicit feedback on how to improve it. The Bureau 
renewed this waiver in subsequent years.
    7. In 2019, the Bureau allowed recovery of an operating margin, 
determined as a percentage of annual expenses, in lieu of the rate of 
return on capital investment previously allowed. In renewing the 
previously granted waiver permitting provider recovery of expenses for 
outreach to the deafblind community, the Bureau expanded the scope of 
that waiver to include outreach to other potential users of this 
service.
    8. In November 2018, Sprint (now T-Mobile) filed a petition for 
rulemaking requesting a new compensation methodology. The company 
proposed that the Commission adopt a new approach based substantially 
on the Multi-State Average Rate Structure (MARS) compensation plan for 
TTY-based TRS offered through state TRS programs.
    9. The Commission proposes to amend the compensation rules for IP 
Relay to take account of the changed environment in which this service 
is provided. The Commission believes it should continue the practice of 
periodically re-setting the compensation level based on determinations 
of reasonable provider cost. As the Commission explained last year when 
setting compensation for internet Protocol Captioned Telephone Service 
(IP CTS) in the IP CTS Compensation Methodology Order, published at 85 
FR 64971, October 14, 2020, over a long period ``the Commission has 
developed a consistent approach to determining

[[Page 64442]]

the reasonable costs of providing TRS, which can be applied without 
imposing undue administrative burdens on either providers or the 
Commission.'' Further, ``[a]lthough any ratemaking method is subject to 
imprecision, provider cost data, which is subject to audit, has been 
reasonably reliable and consistent,'' and ``the Commission's 
determinations regarding allowability of costs are solidly reasoned and 
have been upheld on judicial review.'' The Commission seeks comment on 
whether these general observations continue to hold true for IP Relay.
    10. The Commission proposes to continue setting the compensation 
level for a multi-year period, subject to annual adjustment based on 
predetermined factors. The Commission proposes a number of changes in 
how reasonable costs are determined, and seeks comment on whether to 
change the specific duration of the compensation period and on the 
appropriate criteria for annual adjustment of the compensation level, 
as well as other aspects of the methodology. The Commission seeks 
comment on which specific aspects of the cost-based approach have been 
problematic in the IP Relay context and how they could be improved. The 
Commission seeks additional comment on the MARS-based alternative 
proposed in T-Mobile's petition for rulemaking, and invites commenters 
to suggest additional alternative compensation methodologies.

Benefits of IP Relay

    11. The Commission seeks granular information on which segments of 
the TRS-eligible population primarily use and benefit from this 
service. How many deafblind individuals use IP Relay and how many 
minutes of use do they represent? The Commission seeks comment on the 
best way to determine or estimate these numbers. What features of IP 
Relay are critical for this customer segment? What proportion of IP 
Relay users represent people who became deaf or hard of hearing early 
in life, and are unable to use VRS because they do not know ASL? To 
what extent is IP Relay used to make 911 calls, and what advantages 
does it offer in this regard? To what extent do other forms of TRS (or 
other communications services, such as real-time text) provide an 
effective substitute to IP Relay for individuals who might otherwise 
rely on the service as their sole or primary means of telephone 
communication? To what extent do people who lose hearing later in life 
find IP Relay beneficial, despite the availability of other options, 
such as IP CTS? Would a person with close to 100% hearing loss find IP 
Relay preferable to IP CTS? Would such a preference depend on how much 
an individual's speech is affected, or other factors? The Commission 
seeks comment on whether there has been enough outreach and education 
to the deafblind community by the Commission and TRS providers and 
whether more is needed. Would increased outreach and education to the 
deafblind community regarding the availability and merits of each type 
of TRS increase legitimate demand for IP Relay?

Allowable Expenses

    12. The Commission has made a number of determinations, both for 
TRS generally and for specific relay services, as to whether various 
categories of costs are allowable for recovery from the TRS Fund as 
reasonable costs of providing TRS. The Commission seeks comment on 
possible amendments to the allowable cost rules.
    13. Outreach. The Commission proposes to rescind the current 
prohibition on outreach recovery by IP Relay providers and seeks 
comment on this proposal, its costs and benefits, and the underlying 
rationale stated below.
    14. First, CGB has found that in the absence of competition, 
providing economic incentive for outreach and education by the sole 
service provider may be critical to effectively educate consumers--
including consumers who are deafblind and others--regarding the 
availability of and improvements to the service. The Commission invites 
comment on the extent to which outreach for this purpose continues to 
be needed and the resulting benefits.
    15. Second, with only one IP Relay provider, the Commission 
believes that provider outreach expenditures in this context are more 
likely to be focused appropriately on educating existing and potential 
IP Relay users about the service rather than on encouraging or 
preventing ``churn'' among existing customers, would therefore be more 
effective for their intended purpose than when the outreach ban was 
adopted, and would not likely duplicate other outreach efforts. 
Finally, a review of the outreach reports submitted by T-Mobile in 
response to the resumption of compensated outreach activity has not 
shown that they are misdirected toward ineligible users. Therefore, the 
Commission does not believe such efforts would contribute to a 
recurrence of the kind of misuse of IP Relay that occurred prior to 
2015. The Commission seeks comment on these assumptions.
    16. The Commission seeks comment on whether to limit allowable 
outreach expenses to a specified percentage or amount, and, if so, what 
percentage or amount should be allowed. How should the Commission 
measure the effectiveness of outreach efforts--based on the number of 
new users or on some other basis? Should the Commission continue to 
require the filing of regular reports to ensure that outreach expenses 
are beneficial and effectively educating consumers about IP Relay 
service, and if so, on what schedule? Should the Commission continue to 
require separate reporting of general and deafblind outreach activities 
and the associated costs?
    17. Indirect Overhead. The Commission seeks comment on whether to 
modify, with respect to IP Relay, the Commission's rule allowing 
recovery for only those overhead costs directly related to and directly 
supporting the provision of relay service and whether there is a 
continuing need for this rule in the IP Relay context.
    18. First, is the current rule effectively mandated by section 225 
of the Communications Act of 1934, as amended? 47 U.S.C. 225. Given 
that only some current providers of TRS are common carriers, does the 
Commission have more flexibility in determining what costs are 
reasonable?
    19. Second, the Commission seeks comment on the cost-effectiveness 
of the current rule, relative to alternatives, notably allowing a 
reasonable contribution toward overhead costs. To what extent is it 
feasible for a multi-service provider to track administrative costs 
directly, to the extent they are attributable to the provision of TRS? 
Is it unduly burdensome to require a demonstration of cost causation 
for such costs, e.g., by maintaining time records for staff time 
attributable to IP Relay? What specific kinds of administrative costs 
that are not currently recoverable would be recovered if allocation of 
overhead were permitted? The Commission seeks comment on whether there 
are circumstances specific to the current context of IP Relay, such as 
the presence of only one provider, that make the rule more burdensome 
or less appropriate for application to this service, compared to other 
forms of TRS? How much would allowing support for such costs increase 
per-minute IP Relay compensation? Is there any risk T-Mobile would 
abandon TRS if it continued to receive no contribution to overheads but 
continued to be fully compensated for all costs attributed to TRS?
    20. If the Commission were to allow recovery of overhead costs, 
i.e., administrative costs not directly attributable to TRS, how should 
such

[[Page 64443]]

costs be allocated--based on the percentage of total revenues derived 
from IP Relay, percentage of total company costs, or by some other 
method? How could the Commission or Fund administrator effectively 
audit such allocations?
    21. Other Allowable Costs. Are there other costs incurred in the 
provision of IP Relay that the Commission's methodology should allow?

Operating Margin

    22. The Commission proposes to amend its compensation rules to 
affirm that the IP Relay compensation level should include an operating 
margin--i.e., an allowance for recovery of a designated percentage of 
allowed expenses, in lieu of return on investment. The Commission seeks 
comment on this proposal and its cost-effectiveness.
    23. The Commission seeks comment on what percentage of allowable 
expenses constitutes a reasonable operating margin for IP Relay. By 
what criteria should the allowed operating margin be determined? Is 
business risk assessment an appropriate measure for setting the 
operating margin for IP Relay? Due to the level of business risk, or 
for other reasons, should the operating margin for IP Relay be 
different from that for other forms of TRS? Is the operating margin of 
12.35%, determined by the Bureau in 2019, a reasonable margin going 
forward, or should a different allowed margin be selected? Have there 
been recent changes in capital markets that would support increasing or 
decreasing this margin? The Commission seeks comment on whether future 
determinations of an operating margin for IP Relay should be made by 
the Commission itself or could be delegated to the Bureau.

Projected Versus Historical Costs

    24. The Commission proposes to return to the pre-2019 practice of 
using only projected costs and demand as the basis for calculating the 
base compensation level for IP Relay and seeks comment on this proposal 
and its cost-effectiveness relative to other approaches. The Commission 
invites the submission of evidence regarding the likelihood that the 
current level of cost increases in IP Relay are likely to continue or 
to prove to be a temporary phenomenon.

Compensation Period and Adjustments

    25. Duration of Compensation Period. The Commission proposes to 
continue setting IP Relay compensation for a multi-year period and 
seeks comment on this proposal and whether it will provide benefits in 
the IP Relay context.
    26. Assuming that the Commission continues setting compensation for 
a multi-year period, should the duration continue to be three years? A 
longer compensation period, such as four or five years, would 
potentially offer a provider greater certainty for the purpose of long-
term planning and allow retention of a larger portion of any profits 
produced by efficiency improvements--as well as reducing the 
administrative burden for the provider and the Commission. Would these 
benefits outweigh the risks posed by the potential for unpredicted cost 
increases or fall-off in demand? Alternatively, would a shorter period 
be preferable, to address cost predictability concerns, while retaining 
some of the benefit of a multi-year plan? The Commission seeks comment 
on the extent to which a compensation period of longer than three years 
would make a material difference to such firms' capacity to provide and 
improve IP Relay service. Recognizing that, if over a given 
compensation period, costs were to rise substantially, and providers 
would have strong incentives to present a robust petition explaining 
their need, and thus obtain relief, to what extent would any benefits 
of a longer compensation period justify the risks of overcompensation 
that would occur if costs were to fall significantly over the period?
    27. Are IP Relay costs sufficiently predictable to warrant setting 
a base compensation amount for a multi-year period? Alternatively, is 
the variability in IP Relay costs sufficiently unpredictable that the 
Commission should reassess the IP Relay compensation level annually? 
The Commission seeks comment on the cost-effectiveness of this 
alternative approach relative to the current approach or other 
alternative approaches. Would the resulting year-to-year uncertainty 
and reduced incentives for efficiency and innovation be outweighed by 
the greater flexibility to ensure full cost recovery in response to 
unpredicted cost and demand changes? Are there net benefits of this 
alternative that would outweigh any increased administrative burden on 
the provider and the Commission?
    28. The Commission also seeks comment on whether compensation 
decisions based on cost determinations, whether made annually or at 
longer intervals, should be made by the full Commission, or by the 
Bureau under delegated authority. Further, should other decisions--
e.g., approval of annual changes based on preset adjustment factors, 
determinations regarding exogenous cost claims, and grant or denial of 
requests for waiver of compensation rules--be made at the Commission or 
Bureau level?
    29. Compensation Adjustments During a Multi-Year Period. If the 
Commission continues setting IP Relay compensation for a multi-year 
period, it seeks comment on whether to continue the current practice of 
adjusting the compensation level in subsequent years of the cycle, and 
if so, whether to modify the criteria for such adjustments.
    30. Inflation Adjustment. Should the Commission continue to apply 
an annual inflation adjustment to the base compensation level, and if 
so, how should the adjustment be determined? The current methodology 
uses an inflation factor based on the Gross Domestic Product--Price 
Index (GDP-PI) to adjust the compensation level upward. Is the GDP-PI a 
reasonably accurate predictor of inflation in IP Relay costs? Would 
another price index provide a better measure? For example, because IP 
Relay is currently a labor-intensive service, should the Commission 
select a measure from the Bureau of Labor Statistics' (BLS) Employment 
Cost Index: Historical Listing Volume III (April 2021), available at 
https://www.bls.gov/web/eci/echistrynaics.pdf, which tracks measures of 
labor cost for various industry segments--for example, the seasonally-
adjusted ``office and administrative support,'' ``service-providing 
industries,'' ``other services except public administration,'' or the 
non-seasonally-adjusted ``office and administrative support,'' indices? 
Which measure or measures of inflation in this index would be most 
appropriate for IP Relay? Is there another general or sector-specific 
cost index that would more accurately predict changes in IP Relay cost?
    31. Efficiency Adjustment. The Commission also established an 
efficiency factor, used to adjust the compensation level in a downward 
direction to reflect expected productivity improvements. The Commission 
seeks comment on how best to measure expected efficiency gains for this 
particular service. What are the potential sources of annual efficiency 
gains in IP Relay, and how should the extent of annual efficiency gains 
be estimated? Alternatively, should the Commission eliminate the 
efficiency factor?
    32. Exogenous Costs. The IP Relay base compensation level can be 
adjusted upward to permit recovery of exogenous costs, which are 
``costs beyond the control of the IP Relay providers that are

[[Page 64444]]

not reflected in the inflation adjustment,'' such as a new service 
requirement adopted by the Commission. Should the Commission retain 
this aspect of the methodology? If so, are there other types of 
exogenous costs that warrant inclusion? Should the Commission broaden 
the definition of exogenous costs? Should the Commission apply the 
allowable cost criteria adopted in the 2017 VRS Compensation Order, 
published at 82 FR 39673, August 22, 2017, which allow upward 
compensation adjustment for well-documented exogenous costs that (1) 
belong to a category of costs that the Commission has deemed allowable, 
(2) result from new TRS requirements or other causes beyond the 
provider's control, (3) are new costs that were not factored into the 
applicable compensation rates, and (4) if unrecovered, would cause a 
provider's current allowable-expenses-plus-operating margin to exceed 
its revenues?
    33. Other Adjustments. In addition to adjustments for inflation, 
efficiency, and exogenous costs, are there other types of adjustments 
to the IP Relay compensation level that the Commission should be making 
in subsequent years of a multi-year rate cycle?

Alternative Compensation Methodologies

    34. Hybrid MARS Approach. T-Mobile proposes that in setting a new 
IP Relay compensation level, the Commission should take as a starting 
point the per-minute compensation for interstate TTY-based TRS, which 
is currently set using the MARS method. The Commission would multiply 
the average per-minute rate of TTY-based TRS compensation by the 
projected number of IP Relay minutes, subtract those provider costs 
that are incurred only in providing TTY-based TRS, and add costs that 
are incurred only in providing IP Relay. The resulting funding 
requirement would be divided by projected IP Relay demand to determine 
the per-minute compensation level.
    35. The Commission invites advocates of this approach to identify 
the specific categories of costs they believe would be appropriate to 
add and subtract to achieve an appropriate per-minute compensation 
level using such a hybrid MARS methodology. Which categories of TTY-
based TRS costs, specifically, are not incurred to provide IP Relay, 
which categories of IP Relay costs are not incurred to provide TTY-
based TRS, and what are the estimated current costs in each of those 
categories?
    36. The Commission is unpersuaded that it would be appropriate to 
use a MARS compensation approach as a starting point for setting IP 
Relay compensation, and believes that attempting to revert to a version 
of the MARS methodology would likely result in significant 
overcompensation for IP Relay, wasting TRS funds. The Commission also 
is not persuaded that T-Mobile's proposed methodology would be any less 
difficult to apply or subject to inaccuracy than the current 
methodology, and T-Mobile's proposal appears inconsistent with recent 
Commission precedent. The Commission seeks comment on the concerns 
stated above. Are there other factors that merit consideration of T-
Mobile's proposal? Would the hybrid MARS approach better serve the 
compensation-setting policy goals articulated above?
    37. Other Methodologies. Are there other compensation methodologies 
that the Commission should consider for IP Relay to achieve its policy 
goals?

Initial Regulatory Flexibility Analysis

    38. As required by the Regulatory Flexibility Act of 1980, as 
amended (RFA), the Commission has prepared this Initial Regulatory 
Flexibility Analysis (IRFA) of the possible significant economic impact 
on a substantial number of small entities by the policies and rules 
proposed in the Notice. Written public comments are requested on this 
IRFA. Comments must be identified as responses to the IRFA and must be 
filed by the deadline for comments on the Notice provided in the item. 
The Commission will send a copy of the entire Notice, including this 
IRFA, to the Chief Counsel for Advocacy of the Small Business 
Administration (SBA).

Need for, and Objectives of the Proposed Rules

    39. In the Notice, the Commission proposes to reform the 
compensation methodology for IP Relay. To develop a complete record, 
the Commission seeks comment on whether and how to modify the process 
for setting projected-cost-based IP Relay compensation, including 
whether certain costs that are currently not allowed should be 
compensable, the methodology for calculating the compensation amount, 
and alternative approaches. The Commission takes these steps to allow 
recovery of reasonable provider costs and ensure that functionally 
equivalent IP Relay is provided in the most efficient manner.

Legal Basis

    40. The authority for this proposed rulemaking is contained in 
sections 1, 2, and 225 of the Communications Act of 1934, as amended, 
47 U.S.C. 151, 152, 225.

Small Entities Impacted

    41. The proposals in the document FCC 21-95 will affect the 
obligations of IP Relay providers. These services can be included 
within the broad economic category of All Other Telecommunications.

Description of Projected Reporting, Recordkeeping, and Other Compliance 
Requirements

    42. The proposed compensation methodology will not create new 
reporting, recordkeeping, or other compliance requirements.

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

    43. Throughout the Notice, the Commission is (1) taking steps to 
minimize the impact on small entities by proposing reforms to the IP 
Relay compensation methodology that would ensure that providers of IP 
Relay are fairly compensated for the provision of IP Relay, including 
considering significant alternatives by identifying and seeking comment 
on multiple methodologies for compensation; and (2) considering various 
options to determine the best compensation methodology for ensuring 
functionally equivalent service and maintaining an efficient IP Relay 
market over the long term in accordance with the Commission's statutory 
obligations. The Notice seeks comment on the effect these proposals 
will have on all entities that have the potential to provide IP Relay, 
including small entities.
    44. The Notice seeks comment from all interested parties. Small 
entities are encouraged to bring to the Commission's attention any 
specific concerns they may have with the proposals outlined in the 
Notice. The Commission expects to consider the economic impact on small 
entities, as identified in comments filed in response to the Notice, in 
reaching its final conclusions and acting in this proceeding.

Federal Rules Which Duplicate, Overlap, or Conflict With, the 
Commission's Proposals

    45. None.

Federal Communications Commission.
Marlene Dortch,
Secretary, Office of the Secretary.
[FR Doc. 2021-24945 Filed 11-17-21; 8:45 am]
BILLING CODE 6712-01-P


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