Support (LTS) amounts to the NECA pool.

[2] National Governor's Association (NGA), Telecommunications, the Next American Revolution (1994) at 38.

[3] The Commission itself has recognized the value of current federal programs in its Subscribership NPRM. See Amendment of the Commission's Rules and Policies to Increase Subscribership and Usage of the Public Switched Network, CC Docket No. 95-115, Notice of Proposed Rulemaking, 10 FCC Rcd 13003, [[paragraph]] 1 (1995) (Subscribership NPRM). See also JSI and Patricia Lum, Organization for the Promotion and Advancement of Small Telecommunications Companies (OPASTCO), Keeping Rural America Connected: Costs and Rates in the Competitive Era, pp. 2-1 through 2-14, 3-6 and 3-7, 4-1 through 4-15, 5-2 through 5-12, 5-20 through 5-27, 6-1 through 6-17 (1994) (OPASTCO Study). The OPASTCO Study provides a detailed description of the benefits of universal service programs and the negative impacts that would result from their elimination.

[4] See NECA Comments, Appendix A (Oct. 28, 1994), CC Docket No. 80-286.

[5] Id. Data presented in NECA's 1995 Comments showed, however, that over a comparable period of time rates for basic local exchange services have, on average, gone up. NECA Comments at 22 (Oct. 10, 1995), CC Docket No. 80-286.

[6] In 1995 NPRM Comments NECA provided analyses of both embedded costs and projected costs of installing new switches that showed that switching costs per unit of demand increases as switch size decreases. In other words, in sparsely populated rural areas, small companies serving only a few customers encounter higher per-unit switching costs. NECA analysis also showed that the DEM weighting rules provide an accurate way of identifying study areas with higher per-unit costs. See NECA 1995 NPRM Comments at 30-47.

[7] Under the Commission's 1976 decision in Resale and Shared Use, the term "resale" does not encompass the non-profit sharing of facilities and services among unaffiliated users. See Resale and Shared Use of Common Carrier Services, 60 FCC 2d 261, recon., 62 FCC 2d 588 (1977), aff'd sub nom. American Tel. & Tel. Co. v. FCC, 572 F.2d 17 (2d Cir. 1978). Thus, a prohibition against "resale" in itself, may not be sufficient to prevent misuse of specially-discounted services.

[8] As discussed in response to question 72, infra, a modified version of the current FCC Form 431 could be used to determine all contribution amounts.

[9] See, e.g., CC Docket No. 96-45, Comments of the Rural Telephone Coalition at 11-13, United States Telephone Association at 17 (filed April 12, 1996).

[10] In its April 12 Comments NECA suggested that this could be accomplished by comparing actual cost per line data of new eligible carriers to incumbent LEC costs. Since significant differences in costs can exist between lines serving towns and those serving outlying areas, it would be necessary to disaggregate costs below the study area level for incumbent LECs.

[11] According to the Court in Alltel, the Commission "cannot save an irrational rule by tacking on a waiver procedure." 838 F.2d at 561, citing WAIT Radio v. FCC, 418 F.2d 1153, 1158 (D.C.Cir.1969).

[12] The Commission's Part 36 rules are based on long-standing regulatory separations practices, which in turn can be traced to the constitutional requirement for separation between state and federal regulatory spheres. See Smith v. Illinois Bell Tel. Co., 283 U.S. 133, 151 (1930). See also Com. Car. Bur., FCC, Preparation for Addressing Universal Service Issues: A Review of Current Interstate Support Mechanisms 92-93 (1996).

[13] The rules also permit incumbent LECs with higher-than-average loop costs to allocate an additional portion of loop-related costs to the interstate jurisdiction for recovery via the interstate Universal Service Fund. See 47 C.F.R. [[section]] 36.601 et seq.

[14] The argument that carrier common line costs and/or USF amounts are "subsidies" was considered and rejected by the Commission and the Courts years ago. Amendment of Part 67 of the Commission's Rules and Establishment of a Joint Board, Decision and Order, 96 FCC 2d 781, 785-797 (1984), aff'd sub nom. Rural Telephone Coalition v. FCC, 838 F.2d 1307, 1314-1315 (D.C. Cir. 1988). It is unclear why the Commission would wish to reopen the question at this time.

[15] CC Docket 96-45, Rural Telephone Coalition Comments (filed April 12, 1996) at 17-18.

[16] See Smith, 283 U.S. 133.

[17] See The NYNEX Telephone Companies Petition for Waiver, Transition Plan to Preserve Universal Service in a Competitive Environment, Memorandum Opinion and Order, FCC 95-185 (rel. May 4, 1995).

[18] Processing individual TRS contributor forms costs about $20 per year per contributor. This estimate includes only the costs of entering TRS Form 431 data into NECA systems and does not include other costs associated with collecting contributions (e.g., costs of identifying potential contributors, verifying underlying revenue data, etc.).

[19] This may be particularly useful if the Commission determines that only certain revenues should be used to fund a specific program.

[20] Assuming a fund of $1 billion, using TRS reported revenues, the $100 minimum equates to approximately $10,000 of interstate revenue (a $5 billion fund would equate to $2,000 of interstate revenue, a $10 billion fund, $1,000).