It’s that time again. Spring is in the air, the birds are chirping, the days are longer, and telecommunications providers1 are required to complete their FCC Forms 499-A, reporting historical revenues for calendar year 2014. Like the seasons, the FCC Form 499-A is ever changing. So, as you begin filling out this year’s form, here are a few important points to keep in mind.

1.  The 2015 FCC Form 499-A must be completed electronically.

Unlike prior years, beginning with the 2015 FCC Form 499-A and the May 2015 FCC Form 499-Q, all telecommunications providers with Internet access are required to file their FCC Forms 499 electronically using the Universal Service Administrative Company’s (USAC)2 E-File system.3 If a telecommunications provider has Internet access, USAC will not accept a 2015 FCC Form 499-A filed by mail.

To minimize potential glitches, and ensure timely filing, telecommunications providers who have not yet set-up their E-File accounts should do so immediately. Telecommunications providers who have already created E-File accounts should confirm that their email addresses and passwords are correct and in working order. For authorized company officers and form preparers who have not used E-File recently, USAC recommends visiting the E-File webpage to reset passwords and re-activate E-File accounts. Telecommunications providers no longer need to submit a hard copy of the FCC Form 499-A to change the company officer for the filing. Instead, the add and remove feature on USAC’s E-File website replaces the need for a hard copy FCC Form 499-A.

Don’t forget – telecommunications providers must both submit and have a company officer certify the FCC Forms 499. Failure by a company officer to timely certify a form results in the form being treated as non-filed and can lead to late filing fees, interest, and penalties.

2.  If you failed to file your quarterly FCC Forms 499-Q, USAC is authorized to create forms on your behalf.

Each quarter, all telecommunications providers that are required to contribute to the federal Universal Service Fund (USF) and do not qualify for the FCC’s de minimis exemption must file the FCC Form 499-Q.4 These forms are filed four times per year,5 and are used to collect revenue information and project a telecommunications provider’s federal Universal Service contribution for the upcoming quarter. After a telecommunications provider files its annual FCC Form 499-A, USAC compares the projected revenues from the FCC Forms 499-Q to the actual revenues reported on the corresponding FCC Form 499-A to “true-up” the revenue amounts.6 If a telecommunications provider over-projects its revenues on the FCC Forms 499-Q, it will receive a federal USF credit, which typically will be credited to the telecommunications provider’s account in three monthly installments beginning in July of the calendar year that the applicable FCC Form 499-A is filed.7 If a telecommunications provider under-projects its revenues on the FCC Forms 499-Q, it will be assessed additional federal Universal Service contribution amounts in three monthly installments, also beginning in July of the calendar year that the applicable FCC Form 499-A is filed.

If a telecommunications provider does not qualify for the FCC’s de minimis exemption and fails to file an FCC Form 499-Q, USAC is authorized to create an estimated form on the telecommunications provider’s behalf.8 FCC Forms 499-Q have a limited, 45-day revision period (regardless of whether the revision would increase or decrease a telecommunications provider’s federal Universal Service contribution obligation), so any potential over-estimate of FCC Form 499-Q revenues by USAC that are not addressed by a timely filed FCC Form 499-Q revision could result in a decreased true-up credit to a telecommunications provider, assuming the provider is eligible for such a credit.

3.  Although there is technically a grace period, don’t wait until the last minute to file the FCC Form 499-A.

The FCC Form 499-A is due on April 1 of each calendar year. Under the FCC’s rules, however, late filing fees do not begin to accrue until a telecommunications provider is more than thirty days late filing the form. This means that, technically, a telecommunications provider may file the FCC Form 499-A on April 30, 2015 without incurring a late filing fee. Leaving the filing until the last minute, however, is ill-advised for a number of reasons. First, if the filing is made even one day after the thirty-day grace period (i.e., May 1, 2015), a late filing fee will be assessed retroactively to the date the form was initially due (i.e., April 1, 2015). Second, if there is an error in, or problem with the submission of, the form, the telecommunications provider will have no time to correct the problem, and likely will be assessed late filing fees. Third, waiting until the last minute to file leaves the company officer with little to no time to certify the form or address any E-File issues that may arise with the company officer’s account or password. Finally, as with federal taxes, many filers wait until the last minute to submit and certify their forms, which can cause delays in accessing the E-File system, form submission, and form certification.

4.  There is no comment cycle associated with the 2015 FCC Form 499-A.

Because of the non-substantive nature of the revisions to the 2015 FCC Form 499-A, the FCC did not seek comments on this year’s form revisions. Aside from the mandatory electronic filing requirement, the FCC made only date, circularity factor, and minor wording changes for clarification to the form.

5.  Downward revisions to the 2014 FCC Form 499-A are due by March 31, 2015.

If a telecommunications provider determines that it has made an error and over-reported its actual calendar year 2013 revenues on its 2014 FCC Form 499-A, it must submit a downward revision to that form no later than March 31, 2015. Although the FCC’s rules permit upward revisions (i.e., revisions that increase a telecommunications provider’s federal USF contribution amounts) to the FCC Form 499-A at any time, downward revisions (i.e., revisions that decrease a telecommunications provider’s federal USF contribution amounts) must be submitted within one year of the original form filing deadline.

6.  Timely payment of federal Universal Service contributions is more important than ever.

Telecommunications providers are required to pay federal regulatory fees and make timely contributions to the federal Universal Service, Telecommunications Relay Service (TRS), Local Number Portability (LNP) and North American Numbering Plan (NANP) funds. On February 3, 2015, the FCC released a policy statement notifying telecommunications providers that it had reevaluated its methodologies for calculating forfeitures for violations of the federal Universal Service and other federal program payment rules.9 Specifically, the FCC replaced its prior forfeiture methodologies with a treble damages approach, under which each delinquent contributor’s apparent base forfeiture liability will be three times the delinquent contributor’s debts to the USF, TRS, LNP, NANP, and regulatory fee programs. For telecommunications providers that collect fund payments from their customers through surcharges, but fail to make the required payments to the federal regulatory funds, the revised base forfeiture is three times the amount of economic gain from the violation. The FCC will not consider any payments made after a telecommunications provider becomes aware of an FCC investigation to offset the amount of the provider’s delinquent debt to each federal program for purposes of a forfeiture calculation. Thus, timely payment of any federal USF true-up, or other federal regulatory fee amounts, is more important than ever.


As always, use caution when filing the FCC Form 499-A. Telecommunications providers should conduct a detailed and thorough review of the revised form and its instructions. Dorsey & Whitney LLP has conducted a detailed review of the instructions to the 2015 FCC Form 499-A to identify pertinent changes that will impact filers and is prepared to discuss any questions you may have prior to filing the form.

The revised FCC Form 499-A and instructions can be found here.

1   The FCC’s rules require all telecommunications carriers providing interstate telecommunications services, interconnected VoIP providers that provide interstate telecommunications, providers of interstate telecommunications that offer interstate telecommunications for a fee on a non-common carrier basis (i.e., private telecommunications providers), and payphone providers that are aggregators to contribute to the federal Universal Service Fund (USF) and file an FCC Form 499-A. All providers of non-interconnected VoIP service with interstate and end-user revenues subject to Telecommunications Relay Service (TRS) contributions must file the FCC Form 499-A in order to register with the FCC and report their revenues for purposes of calculating TRS contributions.
2   USAC is an independent, not-for-profit corporation designated by the FCC as the administrator of the federal USF.
3   If a telecommunications provider lacks sufficient Internet access to submit and certify the 2015 FCC Form 499-A online, it may contact USAC’s help desk to obtain assistance with meeting the form’s filing requirements.
4   A telecommunications provider qualifies for the FCC’s de minimis exemption if its contribution to the federal USF for an applicable calendar year is less than $10,000.
5   The FCC Forms 499-Q are due February 1, May 1, August 1, and November 1 of each calendar year.
6   The annual FCC Form 499 true-up reconciles revenues from the previous calendar year using averages of the FCC’s contribution and circularity factors for the applicable year. 
7   Telecommunications providers can make a credit balance refund request (CBR) at any point throughout a calendar year by following the instructions for a CBR on USAC’s website. With some exceptions, a telecommunications provider may receive a one-time refund at any time during the year if there is a credit balance on the telecommunications provider’s account. The telecommunications provider may either receive a refund of a positive balance, or have that balance transferred to a related account. A telecommunications provider must be current with its FCC Form 499 filings to be considered for a refund, and any credit balance will be offset by known future federal USF contribution obligations.
8   In estimating the form, USAC may use whatever relevant data it has available including, but not limited to, data from previous filings.
9   The Telecommunications Act of 1934, as amended (Act), authorizes the FCC to impose a forfeiture against any entity that willfully or repeatedly fails to comply substantially with any of the provisions of the Act, or of any rule, regulation, or order issued by the FCC.