On Thursday, June 24, 2021, the FCC adopted a Report and Order (“R&O”) adopting new rules in the 911 Fee Diversion proceedings consistent with the Don’t Break Up the T-Band Act of 2020 and the Consolidated Appropriations Act, 2021. As a reminder, the Acts are intended to dissuade states or taxing jurisdictions from continuing the practice of diverting 911/E911 fees. The rules, contained in Appendix A, are largely implemented without modification from those proposed in the 2021 Notice of Proposed Rulemaking. The R&O adopts four major 911 Fee Diversion rules:
- Defines Acceptable “Purposes and Functions”: The R&O defines acceptable purposes and functions as (1) support and implementation of 911 services provided by or in the state or taxing jurisdiction imposing the fee or charge, and (2) operational expenses of PSAPs within such state or taxing jurisdiction. In addition, the R&O provides five general categories of acceptable purposes and functions that the FCC considers to be within this definition, provided they are appropriately documented: Public Safety Answering Point (“PSAP”) operating costs, PSAP personnel, PSAP administration, integrating public safety/first responder dispatch and 911 systems, and providing for the interoperability of 911 systems with one another and with public safety/first responder radio systems. The FCC notes that this is a non-exclusive, illustrative list of examples, so that states and taxing jurisdictions have flexibility to apply the rules to particular circumstances.
- Defines Unacceptable “Purposes and Functions”: The R&O similarly provides three general categories of unacceptable purposes and functions on which localities may not expend 911 fees or charges. These categories include: transfer of 911 fees into the jurisdiction’s general fund or other funds for non-911 purposes, equipment or infrastructure for constructing or expanding non-public safety communications networks, and equipment or infrastructure for public safety/first responder entities that do not directly support 911 services. Again, the FCC warns that this is a non-exclusive, illustrative list of examples.
- Implements Multi-Purpose Fee Safe Harbor: The R&O creates an exception that multi-purpose fees that are designated for “public safety” or “emergency services” will not be considered diversion provided that the jurisdiction specifies the percentage of such fees that are dedicated to 911 services, ensures that the 911 portion of the fees are segregated, and expends the 911 portion of such fees for the acceptable purposes detailed above.
- Creates Determination Procedures: The R&O describes the procedure for jurisdictions that desire to seek a determination that their obligation or expenditure for a purpose or function other than those that have already been deemed “acceptable” should be treated as an acceptable purpose or function. These jurisdictions must file a petition for declaratory ruling, which will be reviewed by the Public Safety and Homeland Security Bureau (“Bureau”) following public comment and reply. In the petition, the jurisdiction must demonstrate that the expenditure supports public safety answering point functions or operations, or has a direct impact on the ability of a public safety answering point to receive or respond to 911 calls or to dispatch emergency responders.
The R&O also codifies other provisions of the Act including defining relevant terms, prohibiting jurisdictions identified as engaging in diversion from participation on advisory committees, requiring compliance with reporting responsibilities, and establishing procedures for using data to improve the Annual 911 Fee Report.
The rule changes become effective sixty days after publication in the Federal Register.
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