Disbursements

Netted or Withheld Disbursements

USAC is required to net or withhold payment to entities in accordance with the Debt Collection Improvement Act (DCIA). All contributors, service providers, and applicants are subject to action pertaining to delinquency and the DCIA. Actions taken under the DCIA are also commonly called actions under the “Red Light Rule.”

Payments Netted

If an entity is delinquent in its universal service obligation, by one day, and more than one penny, it is subject to the provisions of the Red Light Rule. In accordance with the Red Light Rule, USAC will, where possible, apply any disbursement support to the delinquent universal service fund (USF) obligation until such time as the delinquency is cured. This may cause a partial, full, or multiple disbursement payment(s) to be netted against the delinquent amount, depending on the amount of the disbursement as related to the amount owed. USAC will not apply any disbursement support to the delinquent universal service fund (USF) obligation if the disbursement support is in the form of a BEAR (Billed Entity Applicant Reimbursement) payment that is to be issued to an applicant in the Schools and Libraries Program. USAC does not net against BEAR payments.

Payments Withheld

If a service provider is delinquent on non-contributor debt by one day and more than one penny, it is subject to the provisions of the Red Light Rule. In accordance with the Red Light Rule, USAC is obligated to withhold payment of USF disbursements until the debt has been satisfied. These types of debt can include:

• Debt owed to the Federal Communications Commission (FCC)
• Debt owed to other programs such as Telecommunications Relay Service (TRS), Local Number Portability (LNP), North American Number Plan (NANP), as well as others
• Debt owed to the United States Treasury
• Amounts of prior universal service program disbursements to be repaid (commitment adjustments (COMADs), programmatic recoveries)
• Other debt in accordance with the Debt Collection Improvement Act (DCIA)

In all cases, payments that are either netted or withheld due to delinquency do not alleviate the service provider’s obligation to pass or remit payments to applicants in accordance with the program rules. To check your current FCC Red Light status, please use the FCC Red Light Display (RLD) system.

Right to Dispute

In accordance with the Red Light Rule, providers who have received a notice of action may file a dispute, if they feel the action was caused in error. As a first step, entities may file a dispute with USAC. Please refer to the dispute procedures for more information.

Entities may also choose to file an appeal if they disagree with the dispute resolution, or may choose to file an appeal without filing a dispute. Please refer to the appeals procedure for more information.