Federal Communications Commission DA 22-329 Before the Federal Communications Commission Washington, D.C. 20554 In the Matter of ) ) Windstream Communications, LLC ) File No.: EB-FD-21-00032487 ) CD Acct. No.: 202232200001 ) FRN: 0014409924 ) ) ORDER Adopted: April 5, 2022 Released: April 5, 2022 By the Acting Chief, Enforcement Bureau: 1. The Enforcement Bureau of the FCC has entered into a Consent Decree to resolve its investigation into whether Windstream Communications, LLC (Windstream) violated the Commission’s 1 2 RHC Program rules 0F governing the determination of rural rates.1F To settle this matter, Windstream agrees to a total settlement value of $1,204,445.24, including (a) a repayment to the Universal Service Fund in the amount of $1,004,445.24 and (b) a civil penalty to the United States Treasury in the amount of $200,000. Windstream also agrees to implement enhanced compliance measures in connection with its participation in the RHC Program. The Federal Communications Commission’s (Commission or FCC) 3 rules governing the Rural Health Care (RHC) Program 2F are vital to protecting the Program and its resources from waste, fraud, and abuse. This action will help further the Commission’s goal of supporting as many health care providers as possible in delivering health care services to their rural communities 2. After reviewing the terms of the Consent Decree and evaluating the facts before us, we find that the public interest would be served by adopting the Consent Decree and terminating the associated investigation into Windstream’s compliance with the RHC Program rules. 1 The description of the Telecom Program herein refers to the Commission’s rules in effect during the time period covered by the investigation, prior to the Commission’s 2019 revision to the rural rate rules. See e.g., Elimination of Main Studio Rule, MB Docket No. 17-106, Report and Order, 32 FCC Rcd 8158, 8161 (2017) (a recent rule change does not relieve a licensee from its obligation to comply with the rule while it is in effect). 2 See 47 CFR § 54.607 (2018). 3 See 47 CFR §§ 54.600-54.680 (2018). The RHC Program includes two subprograms: the Telecommunications Program (Telecom Program) and the Healthcare Connect Fund (HCF). The Telecom Program provides support for the difference between the rural and urban rates for telecommunications services. See Promoting Telehealth in Rural America, WC Docket No. 17-310, Report and Order, 34 FCC Rcd 7335, 7433, para. 4 (2019) (2019 Report and Order); Federal-State Joint Board on Universal Service, CC Docket No. 96-45, Report and Order, 12 FCC Rcd 8776, 9111-9112 (1997). The HCF promotes the use of broadband services and the formation of health care consortia by providing a 65% discount on an array of advanced telecommunications and information services such as Internet access, dark fiber, business data, traditional Digital Subscriber lines, and private carriage services. See 2019 Report and Order, 34 FCC Rcd at 7433, para. 4; see also Rural Healthcare Support Mechanism, WC Docket No. 02-60, Report and Order, 27 FCC Rcd 16678 (2012) (establishing the Healthcare Connect Fund). While the Consent Decree references the RHC Program generally, the apparent rule violations at issue in the Consent Decree concern the Telecom Program. Federal Communications Commission DA 22-329 3. In the absence of material new evidence relating to this matter, we do not set for hearing the question of Windstream’s basic qualifications to hold or obtain any Commission license or 4 authorization. 3F 4. Accordingly, IT IS ORDERED that, pursuant to the authority delegated by sections 5 0.111 and 0.311 of the Commission’s rules,4F the attached Consent Decree IS ADOPTED and its terms incorporated by reference. 5. IT IS FURTHER ORDERED that the above-captioned matter IS TERMINATED in accordance with the terms of the attached Consent Decree. 6. IT IS FURTHER ORDERED that a copy of this Order and the Consent Decree shall be sent by e-mail to Kristi Moody, Executive Vice President, General Counsel & Corporate Secretary, Windstream Communications, LLC, at kristi.moody@windstream.com, and to Matthew Brill, Esq., Latham and Watkins, LLP, counsel for Windstream Communications, LLC, at matthew.brill@lw.com. FEDERAL COMMUNICATIONS COMMISSION Loyaan A. Egal Acting Chief Enforcement Bureau 4 See 47 CFR § 1.93(b). 5 47 CFR §§ 0.111, 0.311. 2 Federal Communications Commission DA 22-329 Before the Federal Communications Commission Washington, D.C. 20554 In the Matter of ) ) Windstream Communications, LLC ) File No.: EB-FD-21-00032487 ) CD Acct. No.: 202232200001 ) FRN: 0014409924 ) ) CONSENT DECREE 1. The Enforcement Bureau of the Federal Communications Commission (Commission or FCC) and Windstream Communications, LLC (Windstream or the Company), by their authorized representatives, hereby enter into this Consent Decree for the purpose of terminating the Enforcement Bureau’s investigation into whether Windstream violated the Commission’s Rural Health Care Program 1 2 (RHC Program) rules 5F governing the determination of rural rates6F and retention of RHC Program 3 documents.7F To resolve this matter, Windstream agrees to pay a settlement amount of $1,204,445.24, which includes a $200,000 civil penalty, and to implement enhanced compliance measures in connection with its participation in the RHC Program. I. DEFINITIONS 2. For the purposes of this Consent Decree, the following definitions shall apply: 4 (a) “Act” means the Communications Act of 1934, as amended. 8F (b) “Adopting Order” means an order of the Bureau adopting the terms of this Consent Decree without change, addition, deletion, or modification. (c) “Bureau” means the Enforcement Bureau of the Federal Communications Commission. (d) “CD Acct No.” means account number 202232200001, associated with payment obligations described in paragraph 22 of this Consent Decree. (e) “Commission” and “FCC” mean the Federal Communications Commission and all of its bureaus and offices. (f) “Communications Laws” means collectively, the Act, the Rules, and the published and promulgated orders and decisions of the Commission to which Windstream is subject by virtue of its business activities, including but not limited to the RHC Program Rules. (g) “Compliance Plan” means the compliance obligations, program, and procedures described in this Consent Decree at paragraph 17. (h) “Covered Employees” means all employees, contractors and agents of Windstream who perform, supervise, oversee, or manage the performance of, duties that relate to 1 See 47 CFR §§ 54.600-54.680 (2018). 2 See 47 CFR §§ 1.1154, 52.17, 52.32, 54.706 through 54.713, 64.601 and 64.604 (2018). 3 See 47 CFR § 54.631(b)(iii)(2020); prior version at 47 CFR § 54.619(d)(2013). 4 47 U.S.C. § 151 et seq. Federal Communications Commission DA 22-329 Windstream’s responsibilities under the Communications Laws, including the RHC Program Rules. (i) “Effective Date” means the date by which both the Bureau and Windstream have signed the Consent Decree and the Bureau has released an Adopting Order. (j) “Investigation” means the investigation commenced by the Bureau in File Nos. EB- FD-20-00030794 and EB-FD-21-00032487 regarding whether Windstream violated the RHC Program Rules through the Effective Date. (k) “First LOI” means the Letter of Inquiry issued by the Bureau to Windstream on April 13, 2020. (l) “Second LOI” means the Letter of Inquiry issued by the Bureau to Windstream on July 8, 2021. (m) “Operating Procedures” means the standard internal operating procedures and compliance policies established by Windstream to implement the Compliance Plan. (n) “Parties” Windstream and the Bureau, each of which is a “Party.” (o) “RHC Program Rules” means Title 47, Code of Federal Regulations, sections 54.600-54.680, section 254 of the Act, and Commission orders related to the provision of service in the RHC Program. (p) “Rules” means the Commission’s regulations found in Title 47 of the Code of Federal Regulations. (q) “USAC” means the Universal Service Administrative Company, which serves as the administrator for the federal Universal Service Fund (USF or Fund). (r) “Windstream or the Company” means Windstream Communications, LLC and its affiliates, subsidiaries, predecessors-in-interest, and successors-in-interest. II. BACKGROUND 3. The RHC Program provides financial support to eligible rural health care providers so that all health care providers—regardless of whether they are located in rural or urban areas—can 5 implement the modern communications systems that are vital to 21st century medical care.9F The Telecommunications Program (Telecom Program) is part of the Commission’s RHC Program and is paid 6 7 for through the USF. 10F Through the Telecom Program,1 1F eligible rural health care providers can obtain 5 See Federal-State Joint Board on Universal Service, CC Docket No. 96-45, Report and Order, 12 FCC Rcd 8776, 8796, para. 35 (1997); see also 47 CFR § 54.602 (2018). 6 The RHC Program also includes the Healthcare Connect Fund (HCF) which provides a 65% discount on eligible expenses related to broadband connectivity to both health care providers and consortia. See generally Rural Health Care Support Mechanism, WC Docket No. 02-60, Report and Order, 27 FCC Rcd 16678 (2012) (HCF Order); see also 47 CFR §§ 54.630-649 (2018). Beginning in January 2014, rural health care providers receiving support for Internet access received support for these services through the HCF. See HCF Order, 27 FCC Rcd at 16819, para. 354. 7 In August 2019, the Commission revised the rules governing the Telecom Program to simplify calculation of the rural rate, reform competitive bidding in the RHC Program, and provide more clarity regarding RHC Program procedures. See generally Promoting Telehealth in Rural America, WC Docket No. 17-310, Report and Order, 34 FCC Rcd 7335 (2019). As a part of these changes, the Commission adopted a database to determine urban and rural rates for the Telecom Program. See id. at 7372, paras. 76-91. The Wireline Competition Bureau waived the requirement to use this database for Funding Years 2021 and 2022. See generally Promoting Telehealth in Rural America, WC Docket Nos. 02-60 and 17-310, Order, 36 FCC Rcd 7051, 7057, para. 16 (WCB 2021). The Commission’s rules applicable before funding year 2020 therefore are binding on Windstream’s conduct at issue and the description of the Telecom Program herein refers to the Commission’s rules in effect at the time of the (continued….) 2 Federal Communications Commission DA 22-329 rates for supported services that are no higher than the “urban rate,” defined as “a rate no higher than the highest tariffed or publicly-available rate charged to a commercial customer for a functionally similar 8 service in any city with a population of 50,000 or more in that state . . . .”12F The carrier providing the eligible service(s) must provide services at the urban rate, and is entitled to support payments from the Fund to account for the difference between the urban rate and the rural rate (the rate for telecommunications services provided to commercial customers in rural areas, which is generally higher 9 than the urban rate). 13F 4. The Commission’s Rules established three, and only three, methods for a service provider to determine its rural rate. These methods need to be considered in sequence based on the factual 10 circumstances.1 4F The first method (Method 1) must be considered if the service provider itself offers 11 comparable services to non-health care provider customers in the same rural area.15F If so, the Commission’s Rules require that a service provider’s rural rate must “be the average of the rates actually being charged to commercial customers, other than health care providers, for identical or similar services provided by the telecommunications carrier providing the service in the rural area in which the health care 12 provider is located.”16F 5. However, where the telecommunications carrier “is not providing any identical or similar 13 services in the rural area,” the second method (Method 2) must be considered:17F “[T]he rural rate shall be the average of the tariffed and other publicly available rates, not including any rates reduced by universal service programs, charged for the same or similar services in that rural area over the same distance as the 14 eligible service by other carriers.”18F 6. The last and final method (Method 3) must be considered only if there are no tariffed or publicly available rates for such services in that rural area, or if the carrier reasonably determines that this 15 method for calculating the rural rate is unfair.19F In such cases, “the carrier shall submit for the state commission’s approval, for intrastate rates, or the Commission’s approval, for interstate rates, a cost- based rate for the provision of the service in the most economically efficient, reasonably available 16 manner.”20F Where a carrier seeks approval of a state commission for intrastate rates or the Commission Company’s actions described herein. See e.g., Elimination of Main Studio Rule, MB Docket No. 17-106, Report and Order, 32 FCC Rcd 8158, 8161 (2017) (a recent rule change does not relieve a licensee from its obligation to comply with the rule while it is in effect). 8 47 CFR §§ 54.605, 54.613 (2018). The urban rate is no greater than the rate provided for services over a distance equal to the “standard urban distance”, or “the average of the longest diameters of all cities with a population of 50,000 or more within the state.” 47 CFR § 54.605 (2018). 9 47 CFR §§ 54.602, 54.609 (2018). See generally 47 U.S.C. § 254(h)(1)(A); Rural Health Care Support Mechanism, WC Docket No. 02-60, Report and Order, Order on Reconsideration, and Further Notice of Proposed Rulemaking, 18 FCC Rcd 24546 (2003) (2003 Order and Further Notice). 10 See Updated Frequently Asked Questions on Universal Service for Rural Health Care Providers, CC Docket No. 96-45, Public Notice, 12 FCC Rcd 13429, 13433 at part IV, Calculating Amount of Support, Question Nos. 19 - 21 (1997) (1997 PN). See also 47 CFR § 54.607 (2018); The Wireline Competition Bureau Provides Guidance Regarding the Commission’s Rules For Determining Rural Rates in the Rural Health Care Telecommunications Program, WC Docket No. 02-60, Public Notice, 34 FCC Rcd 533, 535 (WCB 2019) (2019 WCB PN). 11 See 1997 PN at 13433, part IV. See also 47 CFR § 54.607(a) (2018); 2019 WCB PN at 535. 12 47 CFR § 54.607(a) (2018). The rates averaged to calculate the rural rate must not include any rates reduced by universal service support mechanisms. Id. A service provider may consider its pre-discount prices for services provided to E-rate customers in determining its rural rates. See 2019 WCB PN at 536, para. 4. 13 See 1997 PN at 13433, part IV. See also 47 CFR § 54.607(b) (2018); 2019 WCB PN at 535, para. 1. 14 47 CFR § 54.607(b) (2018). 15 See 1997 PN at 13433, part IV. See also 47 CFR § 54.607(b) (2018); 2019 WCB PN at 535, para. 1. 16 47 CFR § 54.607(b) (2018). 3 Federal Communications Commission DA 22-329 for interstate rates, “a justification of the proposed rural rate, including an itemization of the costs of 17 providing the requested service” is required.2 1F 7. Carriers participating in the Telecom Program are required to retain documents “related 18 to the delivery of discounted services” for “at least five years” after providing the services.2 F The Telecom Program’s recordkeeping rule states that “any other document that demonstrates compliance with the statutory or regulatory requirements for the rural health care mechanism shall be retained as 19 well.” 23F 8. Through its investigation, the Bureau determined that Windstream failed to use any of the three rate-setting methods available to service providers under 47 CFR § 54.607. In response to the Bureau’s inquiries regarding how the Company determined its rural rates, Windstream stated that the 20 Company did not comply with the specific methodology prescribed by the Commission. 24 F Instead of following Method 1, 2, or 3, Windstream informed the Bureau that it “prepares competitive bids that are designed to offer the best available prices to customers participating in the RHC Program. To achieve this objective, Sales representatives and the Pricing team utilize processes designed to identify competitive rates available in a particular customer’s region and rely on those rates when preparing bids and seeking 21 USF support.”2 5F Windstream has not been able to provide the Commission with documents sufficient to 22 demonstrate the processes used to set its rural rates. 2 6F 9. For the period covered by the Investigation, the Bureau determined that Windstream received $1,004,445.24 in payments from the USF related to rural rate violations in connection with services provided in Funding Year 2017 through Funding Year 2020. The funding requests associated with these payments are listed in the Appendix. 10. Windstream has acknowledged that the Company lacked proper document retention policies and has been unable to produce docu ments sufficient to demonstrate compliance with the 23 Commission’s RHC Program Rules. 27 F III. TERMS OF AGREEMENT 11. Adopting Order. The provisions of this Consent Decree shall be incorporated by the Bureau in an Adopting Order. 17 47 CFR § 54.607(b)(1) (2018). 18 47 CFR § 54.631(b)(iii)(2020); prior version at 47 CFR § 54.619(d) (2013). 19 Id. 20 Letter from Matthew Brill, Latham & Watkins LLP, Counsel to Windstream Communications, LLC, to Jodi Schulz, Investigative Counsel, Fraud Division, Enforcement Bureau, FCC, responding to the Bureau’s November 20, 2020 (Dec. 18, 2020); January 11, 2021 Teleconference between Windstream Counsel and Fraud Division Staff; July 7, 2021 Teleconference between Windstream Counsel and Fraud Division Staff. 21 Letter from Matthew Brill, Latham & Watkins LLP, Counsel to Windstream Communications, LLC, to Marlene Dortch, Secretary, FCC, responding to First LOI (July 13, 2020). 22 See Letter from Rakesh Patel, Chief, Fraud Division, Enforcement Bureau, FCC, to Tony Thomas President & Chief Executive Officer, Windstream Communications, LLC (Apr. 13, 2020) (First LOI); Letter from Rakesh Patel, Chief, Fraud Division, Enforcement Bureau, FCC, to Ma tthew Brill, Latham & Watkins LLP, Counsel to Windstream Communications, LLC (July 8, 2021) (Second LOI); Letter from Jodi Schulz, Investigative Counsel, Fraud Division, Enforcement Bureau, FCC, to Matthew Brill, Latham & Watkins LLP, Counsel to Windstream Communications, LLC (Nov. 20, 2020); Letter from Jodi Schulz, Investigative Counsel, Fraud Division, Enforcement Bureau, FCC, to Matthew Brill, Latham & Watkins LLP, Counsel to Windstream Communications, LLC (Dec. 29, 2020). 23 January 11, 2021 Teleconference between Windstream Counsel and Fraud Division Staff; July 7, 2021 Teleconference between Windstream Counsel and Fraud Division Staff; August 16, 2021 Teleconference between Windstream Counsel and Fraud Division Staff. 4 Federal Communications Commission DA 22-329 12. Jurisdiction. Windstream agrees that the Bureau has jurisdiction over it and the matters contained in this Consent Decree and has the authority to enter into and adopt this Consent Decree. 13. Effective Date; Violations. The Parties agree that this Consent Decree shall become effective on the Effective Date as defined herein. As of the Effective Date, the Parties agree that this Consent Decree shall have the same force and effect as any other order of the Commission. 14. Termination of Investigation. In express reliance on the covenants and representations in this Consent Decree and to avoid further expenditure of public resources, the Bureau agrees to terminate the Investigation. In consideration for the termination of the Investigation, Windstream agrees to the terms, conditions, and procedures contained herein. The Bureau further agrees that, in the absence of new material evidence, it will not use the facts developed in the Investigation through the Effective Date, or the existence of this Consent Decree, to institute any new proceeding on its own motion against Windstream concerning the matters that were the subject of the Investigation, or to set for hearing the question of Windstream’s basic qualifications to be a Commission licensee or hold Commission licenses 24 or authorizations based on the matters that were the subject of the Investigation. 2 8F 15. Admission of Liability. Windstream admits for the purpose of this Consent Decree and for Commission civil enforcement purposes, and in express reliance on the provisions of paragraph 15 herein, that its actions in paragraphs 8 through 10 violated sections 47 CFR § 54.607 and 47 CFR § 54.631(b)(iii) of the Commission’s rules, and that it accepts sole responsibility for those actions. 16. Compliance Officer. In the event it has not already done so, within thirty (30) calendar days after the Effective Date, Windstream shall designate a senior corporate manager with the requisite corporate and organizational authority to serve as a Compliance Officer and to discharge the duties set forth below. Windstream will notify the Enforcement Bureau of the name of the individual so designated 25 and will advise the Enforcement Bureau upon any change in such designation.29 F The person designated as the Compliance Officer shall be responsible for developing, implementing, and administering the Compliance Plan and ensuring that Windstream complies with the terms and conditions of the Compliance Plan and this Consent Decree. In addition to the general knowledge of the Communications Laws necessary to discharge his or her duties under this Consent Decree, the Compliance Officer shall have specific knowledge of the RHC Program Rules prior to assuming his/her duties. 17. Compliance Plan. For purposes of settling the matters set forth herein, Windstream agrees that it shall, within sixty (60) calendar days after the Effective Date, develop and implement a Compliance Plan designed to ensure future compliance with the Communications Laws and with the terms and conditions of this Consent Decree. Windstream will provide the Enforcement Bureau with a draft of this plan for its review and approval within forty-five (45) calendar days of the Effective Date With respect to the RHC Program Rules, Windstream will implement, at a minimum, the following procedures: (a) Operating Procedures. Within sixty (60) calendar days after the Effective Date, Windstream shall establish Operating Procedures that all Covered Employees must follow to help ensure Windstream’s compliance with the RHC Program Rules. Windstream’s Operating Procedures shall include internal procedures and policies specifically designed to ensure that Windstream’s operations comply with the RHC Program rules, including document retention policies to ensure preservation of RHC Program participation records for the period required under Commission rules. Windstream shall also develop a Compliance Checklist that describes the steps that a Covered Employee must follow to ensure compliance with the RHC Program 24 See 47 CFR § 1.93(b). 25 Notification shall be made to Rakesh Patel, Chief, Fraud Division, Enforcement Bureau, Federal Communications Commission, 45 L Street NE, Washington, D.C. 20554 , or his successor or designee, with a copy submitted electronically to Rakesh Patel at Rakesh.Patel@fcc.gov. 5 Federal Communications Commission DA 22-329 Rules. The Compliance Officer shall ensure that Covered Employees adhere to the Operating Procedures and utilize the Compliance Checklist. (b) Compliance Manual. Within sixty (60) calendar days after the Effective Date, the Compliance Officer shall develop and distribute a Compliance Manual to all Covered Employees. The Compliance Manual shall explain the RHC Program Rules and set forth the Operating Procedures that Covered Employees shall follow to help ensure Windstream’s compliance with the RHC Program Rules. Windstream shall periodically review and revise the Compliance Manual as necessary to ensure that the information set forth therein remains current and accurate. Windstream shall distribute any revisions to the Compliance Manual promptly to all Covered Employees. Copies of the most recent updated Compliance Manual shall be available to all Covered Employees online. (c) Compliance Training Program. Windstream shall establish and implement a Compliance Training Program on compliance with the RHC Program Rules and the Operating Procedures. As part of the Compliance Training Program, Covered Employees shall be advised of Windstream’s obligation to report any alleged, suspected or known noncompliance with the RHC Program Rules under paragraph 18 of this Consent Decree and shall be instructed on how to disclose noncompliance directly to the Compliance Officer or to a toll-free Hotline number to which Covered Employees may report this information anonymously. Windstream shall publish this Hotline number in a prominent location on its intranet as well as its internet website. All Covered Employees shall be trained pursuant to the Compliance Training Program within ninety (90) calendar days after the Effective Date, except that any person who becomes a Covered Employee at any time after the initial Compliance Training Program shall be trained within thirty (30) calendar days after the date such person becomes a Covered Employee. The training shall be no less than 45 minutes and shall be recorded and made easily accessible on Windstream’s intranet system. The training may be delivered through a combination of live or prerecorded webcast and interactive training and assessments, as appropriate. Any Covered Employee who does not complete such training, verified by appropriate training certifications, by the applicable deadline may not continue to perform any work related to the RHC Program until such training has been completed and verified by appropriate training certifications. Windstream shall repeat compliance training on an annual basis, and shall periodically review and revise the Compliance Training Program as necessary to ensure that it remains current and complete and to enhance its effectiveness. The Compliance Officer shall ensure that all Covered Employees certify that they received Compliance Training and will abide by the requirements at the time of their hiring and thereafter annually. 18. Reporting Noncompliance. Windstream shall report any instances of alleged, suspected, or known noncompliance with the RHC Program Rules and with the terms and conditions of this Consent Decree within fifteen (15) calendar days after discovery or reports thereof. Such reports shall include a detailed explanation of: (i) each instance or report of alleged, suspected or known noncompliance; (ii) the steps that Windstream has taken or will take to investigate such allegations and, if noncompliance is found, remedy such noncompliance; (iii) the schedule on which any such remedial actions will be taken; and (iv) the steps that Windstream has taken or will take to prevent the recurrence of any such noncompliance. The Compliance Officer must maintain a log of all reports received concerning suspected, alleged or known non-compliance, and shall identify the date and time the report was received, the name of the person making the report, details about the reported conduct or activities, and actions Windstream plans to take to address the report. The logs shall be provided to the FCC upon request. All reports of alleged, suspected or known noncompliance shall be submitted to Rakesh Patel, Chief, Fraud Division, Enforcement Bureau, Federal Communications Commission, 45 L Street NE, 6 Federal Communications Commission DA 22-329 Washington, D.C. 20554, or his successor or designee, with a copy submitted electronically to Rakesh Patel at Rakesh.Patel@fcc.gov. 19. Compliance Reports. Windstream shall file compliance reports with the Commission one hundred and twenty (120) calendar days after the Effective Date, twelve (12) months after the Effective Date, twenty-four (24) months after the Effective Date, and thirty-six (36) months after the Effective Date. (a) Each Compliance Report shall include a detailed description of Windstream’s efforts during the relevant period to comply with the terms and conditions of this Consent Decree and the RHC Program Rules. In addition, each Compliance Report shall include a certification by the Compliance Officer, as an agent of and on behalf of Windstream stating that the Compliance Officer has personal knowledge that Windstream: (i) has established and implemented the Compliance Plan; (ii) has utilized the Operating Procedures since the implementation of the Compliance Plan; and (iii) is not aware of any instances of noncompliance with the terms and conditions of this Consent Decree, including the reporting obligations set forth in paragraph 18 of this Consent Decree. (b) The Compliance Officer’s certification shall be accompanied by a statement explaining the basis for such certification and shall comply with section 1.16 of the Rules and be subscribed to as true under penalty of perjury in substantially the form 26 set forth therein. 30 F (c) If the Compliance Officer cannot provide the requisite certification, the Compliance Officer, as an agent of and on behalf of Windstream, shall provide the Commission with a detailed explanation of the reason(s) why and describe fully: (i) each instance of noncompliance; (ii) the steps that Windstream has taken or will take to remedy such noncompliance, including the schedule on which proposed remedial actions will be taken; and (iii) the steps that Windstream has taken or will take to prevent the recurrence of any such noncompliance, including the schedule on which such preventive action will be taken. (d) All Compliance Reports shall be submitted to Rakesh Patel, Chief, Fraud Division, Enforcement Bureau, Federal Communications Commission, 45 L Street NE, Washington, D.C. 20554, or his successor or designee, with a copy submitted electronically to Rakesh Patel at Rakesh.Patel@fcc.gov. 20. Termination Date. Unless stated otherwise, the requirements set forth in this Consent Decree shall expire thirty-six (36) months after the Effective Date, provided that Windstream has substantially complied in all material respects with its obligations under paragraphs 16 through 19. If it has failed to do so, the provisions of paragraphs 16 through 19 shall remain in effect until Windstream has been in compliance with those obligations for at least a full calendar year. 21. Section 208 Complaints; Subsequent Investigations. Nothing in this Consent Decree shall prevent the Commission or its delegated authority from adjudicating complaints filed pursuant to 27 section 208 of the Act31 F against Windstream or its affiliates for alleged violations of the Act, or for any other type of alleged misconduct, regardless of when such misconduct took place. The Commission’s adjudication of any such complaint will be based solely on the record developed in that proceeding. Except as expressly provided in this Consent Decree, this Consent Decree shall not prevent the Commission from investigating new evidence of noncompliance by Windstream with the Communications Laws. 26 47 CFR § 1.16. 27 47 U.S.C. § 208. 7 Federal Communications Commission DA 22-329 22. Settlement Amount and Civil Penalty. Windstream agrees to a Settlement Amount of $1,204,445.24 (Settlement Amount) to fully resolve the Investigation. (a) Within thirty (30) calendar days of the Effective Date, Windstream will repay to the USF the amount of $1,004,445.24 (Repayment Amount). (b) Within thirty (30) calendar days of the Effective Date, Windstream will pay a civil penalty to the United States Treasury in the amount of $200,000 (Civil Penalty). (c) Windstream acknowledges and agrees that upon execution of this Consent Decree, the 28 Settlement Amount shall become a “Claim” or “Debt” as defined in 31 U.S.C. § 3701(b)(1).32F Upon an Event of Default, all procedures for collection as permitted by law may, at the Commission’s discretion, be initiated. (d) Windstream releases any and all claims it has asserted, could have asserted, or may assert in the future before or against USAC and/or the Commission relating to the funding requests identified in Appendix A. (e) Windstream shall send electronic notification of payment of the Repayment Amount and payment of the Civil Penalty to Rakesh Patel, Chief, Fraud Division, Enforcement Bureau, Federal Communications Commission, 45 L Street NE, Washington, D.C. 20554 , or his successor or designee, with a copy submitted electronically to Rakesh Patel at Rakesh.Patel@fcc.gov, on the date each said payment is made. Payment of the Repayment Amount and Civil Penalty must be made by credit card, ACH (Automated Clearing House) debit from a bank account, or by wire transfer using the Commission’s Registration System 29 (the Commission’s FRN Management and Financial system). 3 3F The Commission no longer accepts civil penalty payments by check or money order. Below are instructions that payors 30 should follow based on the form of payment selected:34F • Payment by wire transfer must be made to ABA Number 021030004, receiving bank TREAS/NYC, and Account Number 27000001. A completed Form 159 must be faxed to the Federal Communications Commission at 202-418-2843 or e-mailed to RROGWireFaxes@fcc.gov on the same business day the wire transfer is 31 initiated. 35F Failure to provide all required information in Form 159 may result in payment not being recognized as having been received. When completing FCC Form 159, enter the Account Number in block number 23A (call sign/other ID), enter the letters “FORF” in block number 24A (payment type code), and enter in block number 11 the 32 FRN(s) captioned above (Payor FRN). 3 6F For additional detail and wire transfer instructions, go to https://www.fcc.gov/licensing-databases/fees/wire-transfer. • Payment by credit card must be made by using the Commission’s Registration System (CORES) at https://apps.fcc.gov/cores/userLogin.do. To pay by credit card, log-in using the FCC Username associated to the FRN captioned above. If payment must be split across FRNs, complete this process for each FRN. Next, select “Manage Existing FRNs | FRN Financial | Bills & Fees” from the CORES Menu, then select FRN Financial and the view/make payments option next to the FRN. Select the “Open Bills” tab and find the bill number associated with the CD Acct. No. The bill number is the CD Acct. No. with the first two digits excluded (e.g., CD 1912345678 would be associated with FCC Bill 28 Debt Collection Improvement Act of 1996, Pub. L. No. 104-134, 110 Stat. 1321, 1358 (Apr. 26, 1996). 29 Payments made using CORES do not require the submission of an FCC Form 159. 30 For questions regarding payment procedures, please contact the Financial Operations Group Help Desk by phone at 1-877-480-3201 (option #6), or by e-ma il a t ARINQUIRIES@fcc.gov. 31 FCC Form 159 is accessible at https://www.fcc.gov/licensing-databases/fees/fcc-remittance-a dvice-form-159. 32 Instructions for completing the form may be obtained at http://www.fcc.gov/Forms/Form159/159.pdf. 8 Federal Communications Commission DA 22-329 Number 12345678). After selecting the bill for payment, choose the “Pay by Credit Card” option. Please note that there is a $24,999.99 limit on credit card transactions. • Payment by ACH must be made by using the Commission’s Registration System (CORES) at https://apps.fcc.gov/cores/paymentFrnLogin.do. To pay by ACH, log in using the FCC Username associated to the FRN captioned above. If payment must be split across FRNs, complete this process for each FRN. Next, select “Manage Existing FRNs | FRN Financial | Bills & Fees” on the CORES Menu, then select FRN Financial and the view/make payments option next to the FRN. Select the “Open Bills” tab and find the bill number associated with the CD Acct. No. The bill number is the CD Acct. No. with the first two digits excluded (e.g., CD 1912345678 would be associated with FCC Bill Number 12345678). Finally, choose the “Pay from Bank Account” option. Please contact the appropriate financial institution to confirm the correct Routing Number and the correct account number from which payment will be made and verify with that financial institution that the designated account has authorization to accept ACH transactions. 23. Event of Default. Windstream agrees that an Event of Default shall occur upon the failure by Windstream to pay the full Settlement Amount on or before the due date specified in this Consent Decree Or failure to abide by the requirements of this Consent Decree pertaining to compliance obligations as set forth in paragraphs 16 through 19. 24. Interest, Charges for Collection, and Acceleration of Maturity Date. After an Event of Default has occurred under this Consent Decree, the then unpaid amount of the Repayment Amount or Civil Penalty shall accrue interest, computed using the U.S. Prime Rate in effect on the date of the Event of Default plus 4.75%, from the date of the Event of Default until payment in full. Upon an Event of Default, the then unpaid amount of the Repayment Amount or the Civil Penalty, together with interest, any penalties permitted and/or required by the law, including but not limited to 31 U.S.C. § 3717 and administrative charges, plus the costs of collection, litigation, and attorneys’ fees, shall become immediately due and payable, without notice, presentment, demand, protest, or notice of protest of any kind, all of which are waived by Windstream. 25. Waivers. As of the Effective Date, Windstream waives any and all rights it may have to seek administrative or judicial reconsideration, review, appeal or stay, or to otherwise challenge or contest the validity of this Consent Decree and the Adopting Order. Windstream shall retain the right to challenge Commission interpretation of the Consent Decree or any terms contained herein. If either Party (or the United States on behalf of the Commission) brings a judicial action to enforce the terms of the Consent Decree or the Adopting Order, neither Windstream nor the Commission shall contest the validity of the Consent Decree or the Adopting Order, and Windstream shall waive any statutory right to a trial de novo. Windstream hereby agrees to waive any claims it may otherwise have under the Equal Access to 33 Justice Act37F relating to the matters addressed in this Consent Decree. 26. Severability. The Parties agree that if any of the provisions of the Consent Decree shall be held unenforceable by any court of competent jurisdiction, such unenforceability shall not render unenforceable the entire Consent Decree, but rather the entire Consent Decree shall be construed as if not containing the particular unenforceable provision or provisions, and the rights and obligations of the Parties shall be construed and enforced accordingly. 27. Invalidity. In the event that this Consent Decree in its entirety is rendered invalid by any court of competent jurisdiction, it shall become null and void and may not be used in any manner in any legal proceeding. 28. Subsequent Rule or Order. The Parties agree that if any provision of the Consent Decree conflicts with any subsequent Rule or order adopted by the Commission (except an order 33 See 5 U.S.C. § 504; 47 CFR §§ 1.1501–1.1530. 9 Federal Communications Commission DA 22-329 specifically intended to revise the terms of this Consent Decree to which Windstream does not expressly consent) that provision will be superseded by such Rule or order. 29. Successors and Assigns. Windstream agrees that the provisions of this Consent Decree shall be binding on its successors, assigns, and transferees. 30. Final Settlement. The Parties agree and acknowledge that this Consent Decree shall constitute a final settlement between the Parties with respect to the Investigation. In furtherance of settlement, and subject to the other terms of this Consent Decree, the Parties agree as follows: (a) This Consent Decree does not settle any other investigations that have been or might be conducted by other law enforcement agencies, offices, or USAC. (b) Windstream will not pursue any monies from the USF related to Windstream’s participation in the RHC Program in connection with the funding requests listed in the attached Appendix A. 31. Modifications. This Consent Decree cannot be modified without the advance written consent of both Parties. 32. Paragraph Headings. The headings of the paragraphs in this Consent Decree are inserted for convenience only and are not intended to affect the meaning or interpretation of this Consent Decree. 33. Authorized Representative. Each Party represents and warrants to the other that it has full power and authority to enter into this Consent Decree. Each person signing this Consent Decree on behalf of a Party hereby represents that he or she is fully authorized by the Party to execute this Consent Decree and to bind the Party to its terms and conditions. 34. Counterparts. This Consent Decree may be signed in counterpart (including electronically or by facsimile). Each counterpart, when executed and delivered, shall be an original, and all of the counterparts together shall constitute one and the same fully executed instrument. ________________________________ Loyaan A. Egal Acting Chief Enforcement Bureau Federal Communications Commission ________________________________ Date ________________________________ Kristi Moody Executive Vice President, General Counsel & Corporate Secretary Windstream Communications, LLC ________________________________ Date 10 Federal Communications Commission DA 22-329 APPENDIX Funding Requests Associated with Repayment 17113381 18337671 18362431 18393271 18418671 17118801 18337691 18362451 18393371 18418681 17125451 18337731 18362461 18393401 18418691 17153191 18338601 18362491 18393411 18418701 17153231 18340821 18362501 18394281 18418791 17153251 18341121 18363621 18394341 18418811 17153421 18341501 18365041 18394371 18418831 17157931 18342081 18365191 18394391 18418871 17157951 18342091 18365741 18394651 18418881 17169971 18342121 18365751 18395221 18418941 17197261 18342141 18365851 18395501 18420521 18307591 18343051 18366231 18398501 18420541 18307621 18343281 18368001 18398521 18420571 18307661 18345751 18368481 18398551 18420591 18307741 18346781 18368491 18400021 18420901 18307801 18347471 18368831 18400121 18421091 18307871 18347531 18370001 18400821 18421781 18307941 18348041 18371091 18400851 18421951 18308101 18348071 18372241 18401041 18422331 18308161 18348121 18372321 18402541 18422341 18308191 18348191 18372381 18403551 18422351 18308531 18348901 18372391 18407051 18422381 18308581 18348931 18374061 18408891 18428201 18308601 18349151 18378181 18408931 18428901 18308611 18349281 18378421 18408941 18429861 18308621 18349301 18378561 18408971 18430051 18317221 18349311 18379881 18408991 18430081 18321931 18349321 18379921 18409001 18433071 18322201 18349331 18381101 18411151 18433951 18322211 18349361 18381241 18416441 18434081 18322291 18349381 18382771 18416461 18434101 18322731 18349591 18382781 18416471 18434111 18325871 18349651 18383141 18416531 18434121 18328001 18349671 18383161 18418311 18434761 18328061 18352101 18383651 18418431 18435251 18329041 18352151 18383681 18418441 18435291 18329051 18352511 18384341 18418491 18435361 18332121 18354361 18384711 18418501 18436011 18334071 18355961 18385791 18418511 18436771 18334761 18355981 18385871 18418531 18437271 18335121 18356001 18387411 18418541 18437331 18335151 18356011 18389311 18418561 18437381 18335161 18356031 18390661 18418591 18437431 18336791 18357891 18392261 18418601 18437491 18336831 18359601 18392311 18418611 18437521 18337221 18359851 18393201 18418621 18437651 18337361 18361191 18393241 18418641 18437681 18337611 18361211 18393261 18418651 18438291 11 Federal Communications Commission DA 22-329 18442191 19556481 19569511 19586661 20786561 18446271 19556571 19570121 19587111 20788161 18457421 19556681 19570281 19587171 18462891 19556721 19570301 19587271 18463011 19556761 19570351 19587361 18463111 19556801 19570361 19587521 18563271 19556831 19570391 19587571 19515141 19556851 19570431 19588651 19515161 19556871 19570491 19589121 19515171 19556891 19570511 19589341 19515181 19557941 19570551 19589361 19515191 19558571 19570601 19589471 19515211 19558791 19570661 19590361 19515221 19559581 19570931 19593001 19518161 19559651 19570951 19593061 19518251 19559661 19571081 19594971 19523581 19559681 19571331 19596941 19527881 19559731 19572611 19596971 19527951 19559761 19573371 19601151 19528031 19560181 19573381 19601171 19530551 19560211 19573391 19604451 19531061 19562301 19573401 19604521 19531201 19562451 19573411 19605471 19531521 19562591 19573421 19609801 19540681 19562631 19573431 19610071 19540801 19564661 19573441 19611821 19540811 19564821 19573481 19611911 19541441 19564851 19573491 19611961 19541451 19564901 19573701 19612511 19541461 19566061 19573801 19613691 19541491 19566081 19573841 19613741 19541521 19566091 19573861 19617671 19543721 19566101 19573941 19618021 19547501 19566131 19573971 19618141 19547611 19566621 19574051 19618241 19548931 19566641 19574581 19618291 19549061 19566681 19574651 19618461 19549171 19566691 19576091 19619031 19549811 19568061 19576121 19619181 19549871 19568551 19577511 19622561 19549891 19568561 19577531 19627531 19549931 19568571 19577571 19627611 19550431 19568721 19577611 19628521 19554481 19568751 19577671 19628571 19554511 19568781 19577721 19628591 19554531 19568811 19577781 19628611 19554561 19568851 19578081 19631041 19555061 19568881 19578321 19646131 19555071 19568931 19580621 19646281 19555101 19569231 19580671 19646361 19555141 19569241 19582341 19648441 19556391 19569251 19584241 19648771 19556441 19569481 19585671 19655171 12