Parties Debate 911 Fees on VoIP Service

Providers of VoIP (voice over Internet protocol) service are urging the FCC to clarify what services qualify as interconnected VoIP services and to clarify the extent of its preemption of state and local 911 charges for VoIP service that are greater than 911 charges for similar telecom services, and to do so in ways that will ease the onslaught of lawsuits they are facing from local and state agencies arguing that they are underpaying 911 fees.

Parties were responding in WC docket 19-44 to conflicting petitions for declaratory ruling filed in January by BellSouth Telecommunications LLC and several of the Alabama 911 districts asking the Commission to issue a declaratory ruling responding to a primary jurisdiction referral from the U.S. District Court for the Northern District of Alabama. “The District Court’s referral arises from a dispute between the parties regarding BellSouth’s billing of 911 charges for its business telephone service and the Alabama 911 Districts’ position that such service qualifies as Voice over Internet Protocol (VoIP) or similar service pursuant to Alabama’s 911 statute,” the FCC’s Wireline Competition Bureau had noted in inviting comments (TR Daily, Feb. 26).

NCTA said that it “agrees with BellSouth and urges the Commission to declare that state and local governments are preempted by federal law from collecting 911 charges for VoIP services that, in total, exceed the 911 charges applicable to comparable telecommunications services.”

AT&T, Inc., BellSouth’s parent company, opposed the 911 districts’ petition. “[T]he Commission should declare that Voice over Internet Protocol (‘VoIP’) means just what it sounds like: voice communications transmitted using Internet Protocol (‘IP’) technology. If a voice service transmits voice communications over the last-mile facility to a customer premises in any format other than IP, including time division multiplexing (‘TDM’), it cannot be interconnected VoIP service or any other kind of VoIP service. The Commission should confirm that, for a voice service to qualify as VoIP (including interconnected VoIP), it is a necessary, though not sufficient, condition that voice communications are transmitted over the last mile in IP format.”

AT&T added, “While the Districts’ contentions in their petition are unclear and contradictory, they appear to assert that, even if a provider offers a service that transmits voice communications over the last mile in a non-IP format (such as TDM), the service will be interconnected VoIP if the facility transmitting that service terminates at equipment on the customer’s premises that has IP-processing capabilities. The Districts appear to take that position even if those IP capabilities are used exclusively to process the customer’s broadband Internet access service. This appears to be the meaning of the Districts’ repeated descriptions of services as ‘converged’ or ‘integrated’ — terms that the Districts never clearly define but that appear designed to allow them to argue that a TDM voice service somehow becomes merged with a broadband Internet access service carried on the same facility as the voice service, thereby transmogrifying the TDM voice service into interconnected VoIP service through its physical proximity to the Internet service. That theory has no basis in the Communications Act or any Commission rule or order.”

AT&T also argued that the 911 districts erred in arguments about what constitutes customer premises equipment (CPE) for purposes of classifying a service as VoIP and that they are wrong in arguing that the question of the preemptive scope of the federal VoIP statutory provisions at section 615a-1(f)(1) of the Communications Act are properly part of the current proceeding.

“[T]he Commission should resolve the controversy by interpreting § 615a-1(f)(1) to preempt states from requiring VoIP customers to pay more in 911 charges than similarly situated non-VoIP customers, whether that disparity is caused by imposing a higher number of charges on VoIP or a higher rate per charge,” AT&T said.

CenturyLink, Inc., said, “The Petitions submitted by a group of Alabama 911 districts and by BellSouth respectively raise two issues, one simple and one that potentially becomes more complex. The simple issue is whether 47 U.S.C. § 615a-1(f) allows a state or locality to levy higher 911 fees on voice over Internet Protocol (‘VoIP’) services than on legacy time division multiplexing (‘TDM’) services by using the same per-unit rate, but applying that rate to different assessable units. The Districts’ reading that such manipulations are permissible flouts the plain meaning of the statutory language that ‘the fee or charge [assessed on a VoIP service] may not exceed the amount of any such fee or charge applicable to the same class of subscribers to telecommunications services.’  This provision has no meaning unless the ‘fee or charge’ is the total assessed charge. To honor Congress’ directives in the NET 911 Improvement Act and otherwise to promote the deployment of VoIP and IP networks, the Commission must make clear that the statute preempts the result the Districts seek, which is to assess a higher 911 fee on VoIP than on non-VoIP telecommunications services.”

CenturyLink added, “The Commission need not reach the potentially harder issue, which is determining the regulatory classification of various service in various configurations. Once the Commission makes clear that Section 615a-1(f) precludes applying different total charges to VoIP than to equivalent non-VoIP telecommunication services (such as TDM services), the need to classify the service as between VoIP and non-VoIP telecommunications services disappears.”

Verizon Communications, Inc., said that to avoid state-by-state litigation over 911 charges on IP-enabled services, the FCC should grant BellSouth’s petition in its entirety.

In separate comments, the U.S. Telecom Association and Windstream Services LLC also supported BellSouth’s petition.

North Carolina–based IP service provider Bandwidth, Inc., said that like BellSouth, “Bandwidth also has been sued in Alabama, and in other jurisdictions, on claims that it has underpaid 911 charges.” It asked the FCC to “reiterate that it has: (1) defined and asserted exclusive jurisdiction over IVoIP [interconnected VoIP] and (2) required providers of IVoIP to support 911 calling, while (3) deferring to state and local authorities to determine 911 taxes and surcharge regimes to apply to IVoIP as defined by the Commission and as limited by Congress.”

Bandwidth said that “the Districts’ argument that states have the authority to assess 911 charges on VoIP service that is not IVoIP contravenes Commission regulation, precedent, and decision making.”

In jointly filed comments on the BellSouth petition, the 911 districts for Autauga County, Calhoun County, Mobile County, and the city of Birmingham in Alabama said that “the scope and purpose of this inquiry should be viewed narrowly as providing guidance to the federal district court in Alabama as to the applicable law, regulations, and interpretations existing during the relevant time period under review — January 2010 to October 2013. Contrary to BellSouth’s suggestion in its petition, this is not a rulemaking or an occasion for adding new criteria to the definition of IVoIP that did not exist at the time in question. Any such effort to revise or modify the rules would go well beyond the scope of the District Court’s referral, and the application of any such rule changes or reinterpretations retroactively would be manifestly unfair and against the public interest.”

They added, “BellSouth pretends that it is merely seeking confirmation of its understanding of the definition of interconnected-VoIP (IVoIP) as it existed during the relevant period. In fact, as discussed below, BellSouth is asking the Commission to change that definition in significant ways and to apply the new definition retroactively. BellSouth’s first requested declaration is that IVoIP requires voice to be transmitted in IP over the last mile. If by asking for a declaratory ruling on this point BellSouth means to suggest that the Districts disagree with it, then BellSouth is simply wrong. In the parties’ joint background statement, the Districts have agreed that any service that does include internet protocol in the last mile is not an IVoIP service. In some cases, a service that would not qualify as IVoIP under federal law would still qualify as a ‘similar service’ during the relevant period under [Alabama law]. That is an issue for another day.”

The 911 districts said that “[o]f greater significance here is BellSouth’s effort to add a fifth criterion to the definition of IVoIP that existed during the relevant period — indeed, in the definition that exists today.”  They said that the FCC should reaffirm its four-part test for IVoIP and reject BellSouth’s “new customer-order test,” which the 911 districts said ignores the demarcation point relied on by the FCC’s four-part test and calls for considering instead what a customer ordered.  They said that customers often order a branded product rather than requesting a specific technology, and that “BellSouth’s customer-order test is not based on a physical or technological characteristic of a service, but on an agreement between a provider and a customer, which gives a provider complete control over how to describe, and therefore categorize, its service.”

The Madison County (Alabama) Emergency Communications District said, “BellSouth’s petition seeks major changes in FCC rules and federal court precedent that would fundamentally alter the landscape of telephony that would greatly undermine an already inadequate funding mechanism for 911 emergency services. If the Commission finds merit with any of BellSouth’s positions, it should make its ruling prospective only. Retroactive application of BellSouth’s proposals would destabilize 911 agencies and potentially invalidate the statutory 911 funding framework in states throughout the nation.”

Filing jointly, the Texas 9-1-1 Alliance, the Texas Commission on State Emergency Communications (CSEC), and the Municipal Emergency Communication Districts Association urged the FCC “to make clear that granting any aspects of either petition should not call into question long-standing state statutes and regulations for traditional Time Division Multiplexing (‘TDM’) services, which are reasonable, technologically sound, and consistent with the Commission’s 9-1-1 public safety and public interest objectives.

“This is especially true in the context of validation of dispatchable location information from fixed business TDM services or where the scope of state regulations is beyond the reach of the recent Charter decision,” the Texas 911 entities added, a reference to a decision by the U.S. Court of Appeals for the Eighth Circuit (St. Louis), which upheld a lower court’s ruling that Charter Advanced Services LLC’s interconnected VoIP service is an information service under the federal Telecommunications Act and that state regulation of the service is thus preempted (TR Daily, Sept. 7, 2018). —Lynn Stanton,

 Courtesy TRDaily