Sec. 54.401  Lifeline defined.

    (a) As used in this subpart, Lifeline means a retail local service 
offering:
    (1) That is available only to qualifying low-income consumers;
    (2) For which qualifying low-income consumers pay reduced charges as 
a result of application of the Lifeline support amount described in 
Sec. 54.403; and
    (3) That includes the services or functionalities enumerated in 
Sec. 54.101 (a)(1) through (a)(9). The carriers shall offer toll 
limitation to all qualifying low-income consumers at the time such 
consumers subscribe to Lifeline service. If the consumer elects to 
receive toll limitation, that service shall become part of that 
consumer's Lifeline service.
    (b) Eligible telecommunications carriers may not disconnect Lifeline 
service for non-payment of toll charges.
    (1) State commissions may grant a waiver of this requirement if the 
local exchange carrier can demonstrate that:
    (i) It would incur substantial costs in complying with this 
requirement;
    (ii) It offers toll limitation to its qualifying low-income 
consumers without charge; and
    (iii) Telephone subscribership among low-income consumers in the 
carrier's service area is greater than or equal to the national 
subscribership rate for low-income consumers. For purposes of this 
paragraph, a low-income consumer is one with an income below the poverty 
level for a family of four residing in the state for which the carrier 
seeks the waiver. The carrier may reapply for the waiver.
    (2) A carrier may file a petition for review of the state 
commission's decision with the Commission within 30 days of that 
decision. If a state commission has not acted on a petition for a waiver 
of this requirement within 30 days of its filing, the carrier may file 
that petition with the Commission on the 31st day after that initial 
filing.
    (c) Eligible telecommunications carriers may not collect a service 
deposit in order to initiate Lifeline service, if the qualifying low-
income consumer voluntarily elects toll blocking from the carrier, where 
available. If toll blocking is unavailable, the carrier may charge a 
service deposit.
    (d) The state commission shall file or require the carrier to file 
information with the Administrator demonstrating that the carrier's 
Lifeline plan meets the criteria set forth in this subpart and stating 
the number of qualifying low-income consumers and the amount of state 
assistance. Lifeline assistance shall be made available to qualifying 
low-income consumers as soon as the Administrator certifies that the 
carrier's Lifeline plan satisfies the criteria set out in this Subpart.