§ 54.609   Calculating support.

   (a) The amount of universal service support provided for an eligible service
   to be funded from the Telecommunications Program shall be the difference, if
   any, between the urban rate and the rural rate charged for the service, as
   defined herein. In addition, all reasonable charges that are incurred by
   taking such services, such as state and federal taxes shall be eligible for
   universal  service support. Charges for termination liability, penalty
   surcharges,  and other charges not included in the cost of taking such
   service shall not be covered by the universal service support mechanisms.
   Under the Telecommunications Program, rural health care providers may choose
   one of the following two support options.

   (1) Distance based support. The Administrator shall consider the base rates
   for telecommunications services in rural areas to be reasonably comparable
   to  the base rates charged for functionally similar telecommunications
   service in urban areas in that state, and, therefore, the Administrator
   shall  not  include  these  charges  in  calculating  the support. The
   Administrator shall include, in the support calculation, all other charges
   specified, and all actual distance-based charges as follows:

   (i) If the requested service distance is less than or equal to the SUD for
   the state, the distance-based charges for the rural health care provider are
   reasonably comparable to those in urban areas, so the health care provider
   will not receive distance-based support.

   (ii) If the requested service distance is greater than the SUD for the
   state, but less than the maximum allowable distance, the distance-based
   charge  actually  incurred  for that service can be no higher than the
   distance-based charges for a functionally similar service in any city in
   that state with a population of 50,000 or more over the SUD.

   (iii) “Distance-based charges” are charges based on a unit of distance, such
   as mileage-based charges.

   (iv) A telecommunications carrier that provides telecommunications service
   to a rural health care provider participating in an eligible health care
   consortium, and the consortium must establish the actual distance-based
   charges   for  the  health  care  provider's  portion  of  the  shared
   telecommunications services.

   (2)  Base  rate  support. If a telecommunications carrier, health care
   provider, and/or consortium of health care providers reasonably determines
   that the base rates for telecommunications services in rural areas are not
   reasonably comparable to the base rates charged for functionally similar
   telecommunications   service   in  urban  areas  in  that  state,  the
   telecommunications carrier, health care provider, and/or consortium of
   health care providers may request that the Administrator perform a more
   comprehensive  support calculation. The requester shall provide to the
   Administrator the information to establish both the urban and rural rates
   consistent with § 54.605 and § 54.607, and submit to the Administrator with
   Form 466 all of the documentation necessary to substantiate the request.

   (3) Base rate support-consortium. A telecommunications carrier that provides
   telecommunications service to a rural health care provider participating in
   an eligible health care consortium, and the consortium must establish the
   applicable rural base rates for telecommunications service for the health
   care provider's portion of the shared telecommunications services, as well
   as the applicable urban base rates for the telecommunications service.

   (b) Absent documentation justifying the amount of universal service support
   requested for health care providers participating in a consortium, the
   Administrator shall not allow telecommunications carriers to offset, or
   receive  reimbursement  for, the amount eligible for universal service
   support.

   (c) The universal service support mechanisms shall provide support for
   intrastate telecommunications services, as set forth in § 54.101(a), provided
   to rural health care providers as well as interstate telecommunications
   services.

   (d)  Satellite  services.  (1) Rural public and non-profit health care
   providers  may  receive support for rural satellite services under the
   Telecommunications  Program,  even  when  another functionally similar
   terrestrial-based service is available in that rural area. Support for
   satellite services shall be capped at the amount the rural health care
   provider  would have received if they purchased a functionally similar
   terrestrial-based alternative.

   (2) Rural health care providers seeking support from the Telecommunications
   Program for satellite services shall provide to the Administrator with the
   Form  466,  documentation  of  the  urban  and  rural  rates  for  the
   terrestrial-based alternatives.

   (3)  Where  a  rural  health  care  provider  seeks  a  more expensive
   satellite-based service when a less expensive terrestrial-based alternative
   is available, the rural health care provider shall be responsible for the
   additional cost.

   (e) Mobile rural health care providers— (1) Calculation of support. The
   support amount allowed under the Telecommunications Program for satellite
   services provided to mobile rural health care providers is calculated by
   comparing  the rate for the satellite service to the rate for an urban
   wireline service with a similar bandwidth. Support for satellite services
   shall  not  be  capped at an amount of a functionally similar wireline
   alternative. Where the mobile rural health care provider provides service in
   more than one state, the calculation shall be based on the urban areas in
   each state, proportional to the number of locations served in each state.

   (2) Documentation of support. (i) Mobile rural health care providers shall
   provide  to  the Administrator documentation of the price of bandwidth
   equivalent wireline services in the urban area in the state or states where
   the service is provided. Mobile rural health care providers shall provide to
   the Administrator the number of sites the mobile health care provider will
   serve during the funding year.

   (ii)  Where a mobile rural health care provider serves less than eight
   different  sites per year, the mobile rural health care provider shall
   provide  to  the Administrator documentation of the price of bandwidth
   equivalent  wireline  services.  In such case, the Administrator shall
   determine on a case-by-case basis whether the telecommunications service
   selected by the mobile rural health care provider is the most cost-effective
   option. Where a mobile rural health care provider seeks a more expensive
   satellite-based service when a less expensive wireline alternative is most
   cost-effective, the mobile rural health care provider shall be responsible
   for the additional cost.

   [ 68 FR 74502 , Dec. 24, 2003, as amended at  70 FR 6373 , Feb. 7, 2005;  78 FR 13983 , Mar. 1, 2013]

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