NECA Report to FCC
4 05 2009All..
Here is the National Exchange Carrier Association (NECA) report to the Federal Communications Commission (FCC) on funding for Telecommunicaitons Relay Service (TRS).
Basically NECA is submitting report for the FCC to approve the new funding for TRS and explains how they arrive at new rates. Good information there, and not too hard to understand.
Quoting NECA "..submits proposed compensation rates, demand projections, projected fund size and proposed carrier contribution factor for the period July 2009 through June 2010, in accordance with section 64.604 of the Federal Communications Commission’s (FCC or Commission) rules."
Unquote.
A few interesting tidbit of info:
- Approx 4,640 carriers contribute to Interstate TRS Fund.
- If approved by the FCC, carriers will be charged 0.0113 of carrier’s revenue which will be added to the Interstate TRS Fund.
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Multi-state Average Rate Structure is used for TRS (accounting method)
Report explained various methods in calculating TRS reimbursement rates.
Most of you are interested in VRS there is a chart of past and proposed new rates for VRS. Worth checking that out.
Tiered: Past rate was $6.7362 per min to new proposed rate of $6.7025
Tiered: Past $6.4675 to new $6.4352
Tiered3: Past $6.2685 to new $6.2372
Tiered 1 is under 50K VRS Minutes, Tiered2 is between 50K plus one to 500K, and Tiered 3 is above 500K plus one.
Report mentions "Actual weighted average costs" which I think to me means break-even cost of service. If I’m wrong, kindly correct me. Anyway report shows that to be:
- 2007 was $4.5568
- 2007 was $3.9950
- 2008 was $4.1393
Wow…so let’s use 2008 and tiered 2. Theoretically speaking means profit of $2.0979 per minute. No wonder no VRS has bankrupted – at least not yet.
Other intriguing info: Quote: "VRS providers spent over $30 million in marketing and outreach in 2008 (up from approximately $20 million in 2007). The data also reflects that that total legal and regulatory expenses for 2008 (included in the indirect cost category) were approximately $8.9 million (up $4.0 million from legal and regulatory expenses reported for 2007).
Unquote
Folks, it is worth reading through this long report; it’ll give you valuable insights of how TRS reimbursement rates are calculated.
eyes open & thumbs up,
Ed
Categories : Alerts, FCC Issues

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