§  36.601   General.

   (a) The term Universal Service Fund in this subpart refers only to the
   support for loop-related costs included in § 36.621. The term Universal
   Service in part 54 of this chapter refers to the comprehensive
   discussion of the Commission's rules implementing section 254 of the
   Communications Act of 1934, as amended, 47 U.S.C. 254, which addresses
   universal service support for rural, insular, and high cost areas,
   low-income consumers, schools and libraries, and heath care providers.
   The expense adjustment calculated pursuant to this subpart F shall be
   added to interstate expenses and deducted from state expenses after
   expenses and taxes have been apportioned pursuant to subpart D of this
   part. Beginning January 1, 1998, the expense adjustment calculated
   pursuant to this subpart will be administered and funded through the
   new universal service system discussed in part 54 of this chapter.

   (b) The expense adjustment will be computed on the basis of data for a
   preceding calendar year which may be updated at the option of the
   carrier pursuant to § 36.612(a).

   (c) Until June 30, 2001, the annual amount of the total nationwide
   expense adjustment shall consist of the amounts calculated pursuant to
   § 54.309 of this chapter and the amounts calculated pursuant to this
   subpart F. The annual amount of the total nationwide loop cost expense
   adjustment calculated pursuant to this subpart F shall not exceed the
   amount of the total loop cost expense adjustment for the immediately
   preceding calendar year, increased by a rate equal to the rate of
   increase in the total number of working loops during the calendar year
   preceding the July 31st filing. The total loop cost expense adjustment
   shall consist of the loop cost expense adjustments, including amounts
   calculated pursuant to § 36.612(a) and § 36.631. The rate of increase
   in total working loops shall be based upon the difference between the
   number of total working loops on December 31 of the calendar year
   preceding the July 31st filing and the number of total working loops on
   December 31 of the second calendar year preceding that filing, both
   determined by the company's submissions pursuant to § 36.611. Beginning
   January 1, 2000, non-rural incumbent local exchange carriers and,
   eligible telecommunications carriers serving lines in the service area
   of non-rural incumbent local exchange carriers, shall only receive
   support pursuant to this subpart F to the extent that they qualify
   pursuant to § 54.311 of this chapter for interim hold-harmless support.
   Support amounts calculated pursuant to this subpart F but not received
   due to the phase down of interim hold-harmless support or the receipt
   of forward-looking support pursuant to § 54.311 of this chapter shall
   not be redistributed to other carriers.

   [ 52 FR 17229 , May 6, 1987, as amended at  56 FR 27422 , June 14, 1991;  58 FR 69242 , Dec. 30, 1993;  61 FR 34376 , July 2, 1996;  62 FR 32947 , June
   17, 1997;  62 FR 40748 , July 30, 1997;  63 FR 2124 , Jan. 13, 1998;  64 FR 30924 , June 9, 1999;  64 FR 67430 , Dec. 1, 1999;  65 FR 78992 , Dec. 18,
   2000;  66 FR 30085 , June 5, 2001]