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ICC Recovery

ICC Recovery

Intercarrier Compensation Recovery is the component of the Connect America Fund (CAF) that supports reforms to the intercarrier compensation system, the system of regulated payments among carriers to compensate each other for the origination, transport and termination of telecommunications traffic. In 2011, the Federal Communications Commission adopted rules requiring Incumbent Local Exchange Carriers (ILECS) to reduce many of these switched access rates over a multi-year period.

ICC Recovery support enables ILECs to recover a decreasing portion of revenue lost due to reductions in switched access rates. The FCC allows carriers to charge residential customers an Access Recovery Charge (ARC) on a limited basis and recover charges from certain multi-line business customers. If eligible, ILECs may receive additional recovery funds provided they meet certain broadband service obligations.

Features of an ARC

There are a few restrictions and limitations on an ARC. They include:

  • Annual consumer increase is limited to 50 cents
  • Price cap carriers are permitted up to five annual increases
  • Rate-of-return carriers are permitted up to six annual increases
  • ARC cannot be charged to Lifeline program subscribers
  • ARC is independent of the subscriber line charge but it may be listed as a single line item
  • Residential rate ceiling – local consumer rates (including the subscriber line charge and other fees) plus ARC cannot exceed $30
  • Multiline business rate ceiling – the subscriber line charge plus ARC cannot exceed $12.20
  • Maximum permissible recovery from ARC whether or not charged

Carriers may receive additional funds through the Connect America Fund to cover ARC revenue shortfalls. For price cap carriers, these supplementary funds were phased down to zero over a three-year period, beginning in 2017. Rate-of-return carriers will receive supplementary funding without a phase down process for the time being.

Annual Tariff Filings

Carriers receiving CAF ICC support have until June 26, 2026, to submit their annual access charge tariffs and Tariff Review Plans (TRPs) through USAC’s online legacy data collection portal, which is accessible through the USAC E-File system. The data submitted in this filing – which carriers must also submit separately to the FCC by June 16, 2026 – will be used to determine ICC Recovery support between July 2026 and June 2027.

The FCC established procedures and deadlines for the filing of the 2026 annual access charge tariffs and Tariff Review Plans in an order (DA 26-254) released in March of 2026. ILECs must submit all tariff materials to the Commission by June 16, 2026, using the FCC Electronic Tariff Filing System (ETFS). Carriers must also submit a separate annual access charge tariffs and TRPs filing to USAC through the USAC legacy data collection portal, which will be open to accept the tariff materials through June 26, 2026.

In an effort to streamline the CAF ICC annual data collection and support calculation process, USAC has developed a template to help carriers summarize their TRP data for submission to USAC. This eliminates much of the administrative burden in calculating CAF ICC support and ensures the integrity of the data used for calculation. Carriers should submit the summary template to USAC only, along with the annual 2026 TRP filing. Do not send the USAC summary template to the FCC.

Additional Annual Filing Requirements

July 1: Certify financial and operational data collected by FCC Form 481.

October 1: Certify that the carrier is eligible to receive High Cost support and used all support received in the proceeding calendar year only to provide, maintain and upgrade the facilities for which the support was intended and will do the same in the coming calendar year. State utility commissions certify carriers under their jurisdiction as eligible telecommunications carriers (ETCs). Carriers not subject to state jurisdiction self-certify. Learn more about the annual ETC certification.

For more information on ICC Recovery, visit the FCC Connect America Fund information page, the USF/ICC Transformation Order, and the FCC Executive Summary.