Federal Communications Commission DA 14-1146
Before the
Federal Communications Commission
Washington, D.C. 20554
In the Matter of
Coral Wireless d/b/a Mobi PCS Request for 
Review of the Decision of the Universal Service 
Administrator
Request for Review by Cordova Wireless 
Communications, LLC of a Decision of the 
Universal Service Administrator 
Federal-State Joint Board on Universal Service
Federal-State Joint Board on Universal Service 
High-Cost Universal Service Support
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CC Docket No. 96-45
WC Docket No. 05-337
ORDER
Adopted:  August 7, 2014 Released: August 7, 2014
By the Acting Chief, Wireline Competition Bureau:
I. INTRODUCTION
1. In this Order, we address two requests seeking review of decisions by the Universal 
Service Administrative Company (USAC).  Coral Wireless d/b/a Mobi PCS (Coral Wireless) and 
Cordova Wireless Communications (Cordova) each challenge separate decisions by USAC to recover 
high-cost support received under the rules governing support provided to competitive eligible 
telecommunications carriers (ETCs).
1
  For Coral Wireless, we conclude that it was appropriate for USAC
to recover support for certain lines. In doing so, we also deny a request by Coral Wireless for waiver of 
section 54.307(b) or section 54.307(e) of the Commission’s rules to permit Coral Wireless to receive 
support for the lines in question.  For Cordova, we remand the matter to USAC to determine the number
of lines ineligible for support because they are not working loops and to recover support for those lines.
II. BACKGROUND
2. Both Coral Wireless and Cordova seek review of USAC decisions pertaining to 
competitive ETC support.
2
  Both matters involve section 54.307(b) of the Commission’s rules, which 
required competitive ETCs to report the number of working loops (also referred to as lines) in order to 
receive universal service support.  Prior to the USF/ICC Transformation Order, competitive ETCs 
received universal service funding based on the identical support rule.
3
  Following the reforms contained 
                                                     
1
Coral Wireless, Request for Review and Petition for Waiver, WC Docket No. 96-45 et al. (filed Dec. 10, 2012) 
(Coral Wireless Petition); Cordova Wireless Communications, Request for Review, WC Docket No. 96-45 et al., 
(filed July 5, 2013) (Cordova Petition).
2
Pursuant to section 54.723, we conduct de novo of review of such requests.  47 C.F.R. § 54.723. 
3
See Connect America Fund et al., WC Docket No. 10-90 et al., Report and Order et al., 26 FCC 17663, 17825, 
para. 498 (2011) (USF/ICC Transformation Order), aff’d In re: FCC 11-161, 753 F.3d 1015 (10th Cir. 2014).
Federal Communications Commission DA 14-1146
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in the USF/ICC Transformation Order, the identical support rule and the accompanying requirements of 
section 54.307(b) were eliminated starting in January 2012.  Most competitive ETCs stopped reporting 
line counts at that time.
4
  However, competitive ETCs that serve remote areas of Alaska continue to report 
line count information for purposes of receiving support.
5
III. DISCUSSION
A. Coral Wireless
3. Based on our review, we conclude that the lines reported by Coral Wireless were not 
eligible for support under section 54.307(b) of the Commission’s rules.  USAC therefore is directed to 
recover support for these lines.  
4. Coral Wireless is a competitive ETC that sells prepaid wireless services in Hawaii.
6
  As 
part of its internal policies, Coral Wireless routes non-emergency outbound calls to Coral Wireless’s 
customer service center beginning 30 days after a customer has made his last prepayment.
7
  Ninety days 
after the last prepayment, Coral Wireless closes the account.
8
  When reporting line counts for universal 
service purposes under section 54.307, Coral Wireless included all open accounts, including those that 
were between 30 and 90 days since the last prepayment (hereinafter, disputed lines).
9
  
5. In the course of an audit, USAC determined that these disputed lines should not have 
been reported for the purposes of high-cost support under section 54.307 of the Commission’s rules, and 
therefore sought to recover the support associated with those lines from Coral Wireless.
10
  In reaching this 
conclusion, USAC relied upon the definition of working loop contained in Part 36 of the Commission’s 
rules, which requires a loop to be revenue generating.
11
  As the disputed lines were not generating 
revenue, USAC concluded that they were not eligible for support under section 54.307.
12
6.   Under the governing requirements, we conclude the disputed lines were not working 
loops.  Section 54.307(b) of the Commission’s rules defines working loops “for universal services support 
purposes” as “loops as used jointly for exchange and message telecommunications services.”
13
  Under 
Commission regulations, telecommunications service is defined as “the offering of telecommunications
for a fee directly to the public.”
14
Telecommunications, in turn, is defined as “the transmission, between 
                                                     
4
See id. at 17663, 17825-30, paras. 498-511, 47 C.F.R. § 54.307(e)(3).
5
Recently, the Commission proposed to freeze competitive ETC support for carriers serving the remote areas of 
Alaska as of December 31, 2014.  The Commission also proposed to remove the requirement for such competitive 
ETCs to report line count information.  Connect America Fund et al., WC Docket No. 10-90 et al., Report and Order 
et al., FCC 14-54, at para. 256 (rel. Jun. 10, 2014).  The Commission proposed to eliminate section 54.307(b) and to 
renumber and revise section 54.307(e) of the current rules.
6
Coral Wireless Petition at 2.
7
See id. 
8
Id.
9
See id. at 3.
10
See id. at 4-5.
11
See id. at 8.  47 C.F.R. Pt. 36, App.
12
See Coral Wireless Petition at 8.
13
47 C.F.R. § 54.307(b) (emphasis added).
14
47 C.F.R. § 54.5 (emphasis added).
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or among points specified by the user, of information of the user’s choosing, without change in the form 
or content of the information sent and received.”
15
  For the disputed lines, the transmission is not 
occurring between or among points specified by the user: rather, the user indicates the point to which he
wishes to make the call, but Coral Wireless reroutes the call to its service center. This is not 
telecommunications as defined by Commission regulations.  We therefore conclude the disputed lines
were not being used for telecommunications services and were therefore not within the definition of 
working loop contained in section 54.307(b) of the Commission’s rules.  As the disputed lines were not 
working loops under section 54.307(b), they were not eligible for universal service, and USAC correctly 
sought to recover the support previously provided.
7. We reject Coral Wireless’s argument that excluding these loops from funding is a 
retroactive application of a new or changed policy.  We are not persuaded that the InterCall Order cited 
by Coral Wireless is applicable.
16
Nothing in the record before us indicates a prior stated policy or 
widespread practice in the industry to receive support for lines that divert calls to call centers rather than 
the desired party.  
8. We also reject Coral Wireless’s request for a one-time waiver of the requirement that
support is calculated based on working loops.  Good cause must exist to grant a waiver.  Good cause 
requires that special circumstances warrant a deviation from the general rule, and such deviation would 
service the public interest.
17
  Coral Wireless has not identified why the public interest would be served if
support is provided for these disputed loops. While Coral Wireless argues that the reduction in universal 
service funding caused by excluding support for these loops would reduce service to customers, this 
argument proves too much.  Holding that the public interest prong of the waiver standard is met whenever 
a carrier is faced with a reduction in support would effectively negate the public interest requirement, as 
this criterion would be met any time application of a rule resulted in reduced support.  Such an exception 
would swallow the rule.  Therefore, we deny Coral Wireless’s request for a waiver.
B. Cordova
9. Based on our review, we conclude that some of the lines for which Cordova seeks 
support were not offered for a fee, and therefore were not eligible for support under section 54.307(b) of 
the Commission’s rules.  We remand the matter to USAC to determine which of the lines in question 
were offered for no fee to customers.  USAC is directed to recover support for the disputed lines that were 
offered for no fee.  
10. In 2011, in the course of a routine data validation of submitted line counts, USAC 
informed Cordova that a number of its reported lines were ineligible for high-cost support.
18
  USAC 
determined that these lines did not qualify as working loops eligible for high-cost support because the 
                                                     
15
Id. (emphasis added).
16
Request for Review by InterCall, Inc. of Decision of the Universal Service Administrator, CC Docket No. 96-45, 
Order, 23 FCC Rcd 10731 (2008) (InterCall Order).  In the InterCall Order, the Commission deemed conference 
calling services to be telecommunications services and required conference calling providers to directly contribute to 
the universal service fund.  Of the 40 providers offering conference calling services prior to the InterCall Order, 
only 11 were directly contributing, and each of those had independent grounds for doing so other than the provision 
of conference calling services.  Id. at 10739, para. 23 n.62.  The Commission noted that this evidenced a pattern of 
industry practice that conference calling services were not telecommunications services, and thus, for this and other 
reasons, only prospective application was warranted.  Id. at 10739, para. 23.
17
Northeast Cellular Telephone Co. v. FCC, 897 F.2d 1164, 1166 (D.C. Cir. 1990) (citing WAIT Radio v. FCC, 418 
F.2d 1153, 1159 (D.C. Cir. 1969)).
18
Cordova Petition at 3.
Federal Communications Commission DA 14-1146
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lines showed no activity or usage (hereinafter, disputed lines).
19
  In response, Cordova argued that the 
disputed lines were for phones that Cordova donated to public safety for use in emergencies, which, by 
their nature, are rarely if ever used.
20
  Cordova stated that it donates the handsets for the disputed lines 
and provides a local-only service plan for no cost to the end user.
21
11. As noted above, section 54.307 defines working loops to be reported as “the number of 
working Exchange Line C&WF loops used jointly for exchange and message telecommunications 
services.”
22
  Section 54.5 of the Commission’s rules defines “telecommunications services” as “the 
offering of telecommunications for a fee directly to the public.”
23
  
12. Based on Cordova’s statements in the record, we conclude that some of the disputed lines 
were not offered “for a fee.”  Cordova stated that it covers the cost of both the handset and local-only 
service plan for at least some of the disputed lines.
24
  As those disputed lines were not offered “for a fee,” 
they were not used for telecommunications services, and thus do not qualify as working loops eligible for 
support under section 54.307 of the Commission’s rules.  
13. We cannot determine from the record before us which of the disputed lines were not 
offered for a fee.  We therefore remand this matter to USAC to determine the precise number of the 
disputed lines that were not offered for a fee.  USAC is directed to recover support for those disputed
lines not offered for a fee.  
14. If in conducting that review, USAC determines that some disputed lines were offered for 
a fee, USAC is directed to cease recovery of support on those lines. There is no rule requiring activity on 
a line as a precondition for receiving high-cost support.  Section 54.307 of the Commission’s rules does 
not specify a requirement for customer usage.
25
  Given that the Commission has not articulated a 
requirement for usage on lines receiving high-cost support, we conclude that USAC erred in requiring 
Cordova to demonstrate activity on the disputed lines.
26
  
                                                     
19
Id. at 11.
20
Id. at 13-14.  
21
Id. at 13 n.24.  Cordova also filed a petition regarding lines on which support was withheld for failing to provide a 
local billing address.  We have addressed this matter in a separate order.  Federal-State Joint Board on Universal 
Service et al., CC Docket No. 96-45 et al., Order, DA 14-1075, paras. 19-23 (Wireline Comp. Bur. rel. July 28, 
2014). 
22
47 C.F.R. § 54.307.  C&WF is an abbreviation for cable and wire facilities. 47 C.F.R. § 36.154.
23
47 C.F.R. § 54.5 (emphasis added).  
24
Cordova Petition at 13 n.24.
25
We note that the Commission has adopted a specific usage requirement for Lifeline service when the carrier does
not assess and collect a monthly fee from subscribers. See 47 C.F.R. § 54.407(c) (2); Lifeline and Link Up Reform 
and Modernization, WC Docket No. 11-42, Report and Order and Further Notice of Proposed Rulemaking, 27 FCC 
Rcd 6656, 6768-69, para. 257 (2012) (concluding that prepaid eligible telecommunication carriers will not receive 
Lifeline support for inactive subscribers who have not used the service for a consecutive 60-day period).  
26
47 C.F.R. § 54.702(c). 
Federal Communications Commission DA 14-1146
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IV. ORDERING CLAUSES
15. ACCORDINGLY, IT IS ORDERED that, pursuant to the authority contained in section 
1-4 and 254 of the Communications Act, 47 U.S.C. §§ 151-154, and 254, and pursuant to sections 0.91, 
0.291, 1.3, and 54.722 of the Commission’s rules, 47 C.F.R. §§ 0.91, 0.291, 1.3, and 54.722, the request 
for review and waiver filed by Coral Wireless IS DENIED.
16. IT IS FURTHER ORDERED that, pursuant to the authority contained in section 1-4 and 
254 of the Communications Act, 47 U.S.C. §§ 151-154, and 254, and pursuant to sections 0.91, 0.291, 
1.3, and 54.722 of the Commission’s rules, 47 C.F.R. §§ 0.91, 0.291, 1.3, and 54.722, the request for 
review filed by Cordova Wireless Communications IS REMANDED to the Universal Service 
Administrative Company for decision consistent with this Order.
17. IT IS FURTHER ORDERED that, pursuant to section 1.102(b)(1) of the Commission’s 
rules, 47 C.F.R. § 1.102(b)(1), this order SHALL BE effective upon release.
FEDERAL COMMUNICATIONS COMMISSION
Carol E. Mattey
Acting Chief
Wireline Competition Bureau