Debt Collection Practices for FCC Program Fees


This advisory discusses the collection process for Universal Service Fund (“USF”) and other federal program fees owed to the Universal Service Administrative Company (“USAC”), USF administrator, or other federal billing and collection agents serving the Federal Communications Commission (“FCC” or “Commission”).  The Debt Collection Improvement Act of 1996 (“DCIA”) governs the referral, collection and resolution of federal debts.  The FCC determined that unpaid obligations to the USF and other programs such as the Telecommunications Relay Services (“TRS”) Fund, administered by the National Exchange Carrier Association (“NECA”), are subject to the DCIA. The following outlines the step-by-step process delineated in the DCIA.

To avoid referral of overdue debts, carriers should pay all bills on time. Payment plans are available.  For example, USAC allows carriers to petition for installment plans provided they can demonstrate financial inability to pay the debt in one payment.  Please see below for more information.

Step 1Bill Issued

First, USAC, NECA or another federal billing & collection agent issues a bill for federal program fees owed.  Invoiced fees are due within 30 days.  If the balance becomes overdue by 30 days (past the due date by 60 days), it falls into delinquency.

Step 2:  Red Light Status

After proper notice, the billing agent transfers the delinquent debt to the FCC for further collection and enforcement actions. A delinquent debt (ie. 60 + days overdue) shifts the carrier‘s account into “Red Light” status.  Red Light status prevents carriers from receiving benefits (such as application approval, receipt of USF support, etc.) from the FCC. Further, once transferred to the FCC, the delinquent balance is subject to further interest and penalties.

Step 3:  Referral to the U.S. Department of Treasury

Once the FCC receives the debt, the Commission assumes collection responsibility and will request payment from the delinquent debtor within 30 days of transfer. If the debt payment is not received within 30 days of the request (ie. 90 + days after the bill was issued), the FCC will transfer the debt to the U.S. Department of Treasury (“Treasury”) for further collection efforts. Further, delinquent carriers may be subject to enforcement actions by the FCC including, but not limited to, fines and forfeitures. In addition to late payment penalties, the FCC and Treasury have the authority to levy additional collection charges, penalties, and interest.


Clients are advised to pay bills for FCC-governed federal program fees in a timely manner. Remember that the FCC‘s Fee Filer System enables clients to pay FCC bills online (including delinquent debts).  See  Clients can verify whether they have fallen into delinquent or Red Light status at

ATTORNEY ADVERTISING DISCLAIMER: This information may be considered advertising in some jurisdictions under the applicable law and ethical rules. The determination of the need for legal services and the choice of a lawyer are extremely important decisions and should not be based solely upon advertisements or self-proclaimed expertise. No representation is made that the quality of the legal services to be performed is greater than the quality of legal services performed by other lawyers

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