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Federal Register / Vol. 86, No. 8 / Wednesday, January 13, 2021 / Rules and Regulations
providers incur actual costs, they will need to file reimbursement claims along with any required supporting invoices and other cost documentation, as directed by WCB, to obtain reimbursement funds from their allocation. Entities may, and likely will, submit multiple reimbursement requests as they incur expenses throughout the reimbursement period. WCB will review reimbursement claims to ensure that disbursements are made only for costs reasonably incurred.
151. If an actual cost exceeds the estimated cost for a particular line item, the program participant will need to note the nature of the variation in the reimbursement claim filing, e.g., the recipient had to change equipment vendors resulting in higher replacement costs than estimated. The Commission understands the difficulty in accurately estimating costs and expect some degree of variation between estimated and actual costs. Ultimately, while the Commission will exercise some degree of flexibility with such variations, the Reimbursement Program participant cannot draw down more than the total funding amount allocated to it and can only receive reimbursement for reasonable costs incurred. If a recipients costs exceed the funding allocation, then the recipient will need to seek an additional allocation of funding, if funding remains available.
152. To ensure the timely use of allocated funds as intended, the Commission will require recipients to submit all applicable reimbursement claims by a set date following the expiration of the term for completing the removal, replacement, and disposal of covered communications equipment and services. Without a deadline, outstanding funding would have to remain allocated indefinitely to satisfy possible future reimbursement claims filed for actual expenses incurred even if the recipient had no intention of filing any future claims. The effect would be to essentially strand funding and prevent the reallocation of unused funds to other Reimbursement Program participants. Imposing a deadline for the filing of reimbursement claims will address these concerns.
153. The Commission recently imposed a deadline on the filing of invoices to receive committed funds in the Rural Health Care Program to address similar concerns. The Commission similarly adopted an invoicing deadline for the E-Rate Program. In that proceeding, the Commission found an invoicing deadline of 120 days following the expiration of the one-year service delivery deadline, with the possibility
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of a one-time 120 day extension, sufficient to give program participants time to submit claims for expenses incurred while still providing the certainty needed for the efficient deobligation of funding for use by future program participants. For the same reasons, the Commission will apply the approach used in the Rural Health Care Program to the Reimbursement Program.
Recipients are required to file all reimburse claims within 120 days following the expiration of the removal, replacement, and disposal term. Prior to the expiration of the 120-day deadline, recipients can request and receive a 120day extension of the reimbursement claim deadline, if timely requested.
After the expiration of the reimbursement claim deadline, any allocated but as-yet unclaimed funds will revert automatically to the Reimbursement Program for reallocation to other participants pursuant to a future filing window. If a petition for an extension of the removal, replacement, and disposal term is pending when the term expires, then automatic reversion of the unallocated funds is stayed until, and if, the extension request is denied.
Additional details on the removal, replacement, and disposal term, and extensions thereof, are provided in the subsequent section.
154. The Secure Networks Act requires, unless there is an extension provided for by the statute, Reimbursement Program recipients to complete the removal, replacement, and disposal of covered communications equipment or service not later than 1
year after the date on which the Commission distributes reimbursement funds to the recipient. The Commission concludes the one year window for project completion commences when the applicant makes the initial draw down disbursement of funding during the funding distribution stage. Thus, the one-year deadline will vary among recipients depending on when each recipient chooses to accept its initial draw down disbursement. The Commission finds this approach most accurately complies with a straightforward reading of the statute and that it provides applicants a substantial amount of control over when the oneyear window opens since the applicant chooses when to accept the initial drawdown.
155. The Commission recognizes there is concern among providers that the network transition process will likely take more than a year to complete.
Congress has made clear its intent, however, and the Commission lacks discretion to deviate from what the statute requires. By tying the completion
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term to the actual initial disbursement of funds, the Commission adheres to the statutory requirement but also provides some flexibility to applicants. Because the Commission has declined to use a milestone-based phased funding approach, the suggestion to commence the one-year project deadline to the final disbursement is unworkable. At the same time, the Commission acknowledges applicants may defer taking their initial disbursement to further delay commencement of the oneyear deadline. Such actions, in turn, may delay the network transitions to remove, replace, and dispose of equipment and service posing a national security risk. To ensure the efficient and expeditious use of funding to facilitate network transitions, the Commission will require recipients to file to receive their initial disbursement within one year of receiving the funding allocation approval. Failure to file for an initial disbursement within one year of receipt of funding allocation approval will result in the automatic reversion of the funding allocation to the program fund for reallocation to other or future program participants.
156. Term Extensions. The Secure Networks Act authorizes the Commission to grant extensions of time to complete the removal, replacement and disposal of covered communications equipment and service.
The Commission may grant a general six-month extension to all recipients of reimbursements . . . if the Commission:
i finds that the supply of replacement communications equipment or services needed by the recipients to achieve the purposes of the Program is inadequate to meet the needs of the recipients; and ii provides notice and a detailed justification for granting the extension to Congress. The Commission is also authorized to grant individual extensions on a case-by-case basis to program recipients pursuant to petition for a period of time of up to six months.
To grant an individual extension, the Commission must find that, due to no fault of such recipient, such recipient is unable to complete the permanent removal, replacement, and disposal.
According to the legislative history, the Committee expects the Commission to not find it the fault of a recipient of the program if such recipient has a shortage of qualified workers, either employees or contracted third-parties, to complete the removal of covered equipment and replacement of new equipment under the timeframe established.
157. The general extension provision authorizes the Commission to issue sua sponte a one-time six-month extension
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