FCC Cuts VRS Rates, Sets TRS Rates, Fund Size, Industry Contributions
FCC staff followed through Tuesday on planned cuts to video relay service rates over the coming year, despite warnings from VRS providers that the cuts will harm service to the deaf and hard of hearing. The order, issued by the Consumer and Governmental Affairs Bureau, also adopts proposed rates for other telecom relay services, along with a total TRS Fund of $1.048 billion (VRS accounts for almost $600 million of that) and an industry contribution factor of 1.635 percent (of carrier interstate and international telecom revenue) for the funding year running from July 1 to June 30, 2016.
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The bureau said the FCC established in 2013 a "glide path" to lower VRS compensation rates "toward 'cost-based' levels pending the implementation of the structural reforms directed in that order." Following through on proposals from the program's administrator, Rolka Loube Associates, the order reduces the per-minute rate for Tier I providers (with 0-500,000 average monthly minutes) from its current $5.29 to $5.06 for July 1-Dec. 31, 2015, and to $4.82 for Jan. 1-June 30, 2016; and for Tier III providers (with over 1 million average monthly minutes) from the current $4.25 to $4.06 for July 1-Dec. 31, 2015 and to $3.87 for Jan. 1-June 30, 2016. The per-minute rate for Tier II providers (with 500,001-1 million average monthly rates) is kept at $4.82 for the next year.
The bureau said that in setting the rates it's not addressing the merits of a proposal filed by the six current VRS providers to freeze all the current compensation rates. "Action on that proposal will be addressed separately," the order said.
"Rate cuts will inevitably degrade the quality of VRS service, and innovation is not possible in an environment of continually falling rates," said ASL Services, Convo Communications, CSDVRS, Hancock Jahn Lee & Puckett, Purple Communications and Sorenson Communications, in recent comments (see 1506090027). The VRS providers urged the FCC to seek comment on their proposal and adopt it before the rate cuts take effect, but if not, they said the commission could still adopt their proposal after July 1. The bureau Tuesday said it didn't have the authority in this particular order to modify the glide path.
The order also adopts Rolka Loube's proposals in setting the per-minute compensation rates for traditional TRS at $2.2904, for speech-to-speech relay service at $3.4214, for interstate captioned telephone service and IP captioned telephone service at $1.889 and for IP Relay service at $1.37.
The six VRS providers emailed us a statement that called the FCC order "a missed opportunity to improve" VRS, "expand its offerings, and uphold the Americans with Disabilities Act’s promise of functionally equivalent telecom services for people who are deaf and hard-of-hearing." They called on the FCC to immediately issue an NPRM -- with an expedited comment and decision process -- on a joint proposal they submitted earlier this year. "This is the fifth rate cut since June 2013, significantly affecting the ability of providers to continue to provide the highest quality VRS," they said. "The FCC has not yet put the joint proposal out for comment and did not consider it in the current rate order despite the fact that it has the support of the major consumer groups representing deaf Americans, nine of which filed a letter with the FCC regarding the benefits of the proposed enhanced VRS service, as well as the Registry of Interpreters for the Deaf (RID), which similarly expressed their support to the FCC. Although the FCC may yet seek comment, VRS providers must continue to plan for future rate reductions -- which means continuing to cut costs in advance."