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Federal Register / Vol. 86, No. 156 / Tuesday, August 17, 2021 / Rules and Regulations its statutorily mandated responsibilities for ensuring that the 911 system, including 911, E911, and NG911 calls and texts from any type of service, is available, that these 911 services function effectively, and that 911 fee diversion by states and other jurisdictions does not detract from these critical, statutorily recognized purposes.
As we stated in the NPRM, diverting fees collected for 911 service of any type, whether it be wireline, wireless, IP
based, or text, undermines the purpose of these Federal statutes by depriving the 911 system of the funds it needs to function effectively and to modernize 911 operations.
We also adopt our proposal in the NPRM to extend the definition of 911
fee or charge to include multi-purpose fees or charges designated for the support of public safety, emergency services, or similar purposes if the purposes or allowable uses of such fees or charges include the support or implementation of 911 services. We find that this aspect of the definition is consistent with the purpose of section 902 with respect to 911 fees and charges, which is to discourage states and taxing jurisdictions from diverting these fees and charges for purposes that do not directly benefit the 911 system.
Moreover, as we noted in the NPRM, this aspect of the definition is consistent with the approach taken in the agencys annual fee reports, which have found that the mere labelling of a fee is not dispositive and that the underlying purpose of the fee is relevant in determining whether it is or includes a 911 fee within the meaning of the NET
911 Act.
Some commenters oppose the proposal to extend the definition of 911 fee or charge to include multipurpose fees. The New York State Division of Homeland Security and Emergency Services NYS DHSES
asserts that the Commissions statutory authority is limited to specifically designated 911 fees or charges, and that the Commission lacks authority to regulate fees and charges designated for other purposes. The Boulder Regional Emergency Telephone Service Authority BRETSA argues that extending the definition as proposed will limit 911
funding because some states including Colorado have a constitutional prohibition on incurring debt and therefore must establish contingency or sinking funds for unpredictable 911
expenditures. BRETSA asserts that if using the proceeds of such a fee to support 911 will mean that those proceeds cannot thereafter be used for more general purposes, the public safety
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answering point PSAP may be denied funding when needed.
We disagree that our authority under the NET 911 Act extends only to specifically designated 911 fees or charges. The legislative history of the NET 911 Act indicates Congresss broad intention to discourage or eliminate the diversion of 911 fees by states and political subdivisions. In its report on H.R. 3403 the bill that was enacted as the NET 911 Act, the House Committee on Energy and Commerce noted Congresss intent that states and their political subdivisions should use 911 or E911 fees only for direct improvements to the 911 system and that the Act is not intended to allow 911 or E911 fees to be used for other public safety activities that, although potentially worthwhile, are not directly tied to the operation and provision of emergency services by PSAPs. A narrow interpretation covering only specifically designated 911 fees or charges would frustrate this congressional purpose by creating an opportunity for states to divert the 911
portion of a multi-purpose fee.
Moreover, there is no language in the NET 911 Act or in the amendments made by section 902 that limits the scope of that Act to fees designated exclusively for 911/E911. Finally, in its annual fee reports, the agency has found that multi-purpose fees that support 911/E911 and other purposes fall within the Commissions authority under the NET 911 Act.
With respect to BRETSAs argument that extending the definition of 911 fee or charge as proposed would prevent the establishment of sinking or contingency funds for 911 expenditures, we disagree that this would be prohibited under our rules. As discussed below, we also adopt a safe harbor under which a multi-purpose fee would not be deemed to be diverting 911 fees, and we note that sinking or contingency funds could fall within the safe harbor, provided that they meet the relevant criteria.
2. Diversion Background. Section 902f defines diversion, with respect to a 911 fee or charge, as the obligation or expenditure of such fee or charge for a purpose or function other than the purposes and functions designated in the final rules issued under paragraph 3 of section 6f of the Wireless Communications and Public Safety Act of 1999, as added by section 902, as purposes and functions for which the obligation or expenditure of such a fee or charge is acceptable.

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In the NPRM, we proposed to codify this definition with minor changes to streamline it. Specifically, we proposed to define diversion as the obligation or expenditure of a 911 fee or charge for a purpose or function other than the purposes and functions designated by the Commission as acceptable pursuant to the applicable rule section in subpart I. In addition, we proposed to clarify that the definition of diversion includes distribution of 911 fees to a political subdivision that obligates or expends such fees for a purpose or function other than those designated by the Commission.
Decision. We adopt this definition as proposed. We find that it will encourage states and taxing jurisdictions to take proactive steps to address the conditions that enable diversion of 911
fees by political subdivisions, such as counties, that may receive 911 fees.11
Several commenters raise concerns with our proposal to specify that diversion includes distribution of 911
fees to a locality that diverts them. The National Emergency Number Association NENA states that it is concerned that the administrative burden of local surveillance and potential lack of state-level capacity for diversion enforcement could add to the already significant burden on state-level 911 officials. NENA also expresses concern that states may lack the logistical capability to prevent this diversion of funds, especially in a timely manner. The National Association of State 911 Administrators NASNA notes that in some states, service providers remit fees directly to political subdivisions, such as counties, for 911 use and that due to limits in their statutes or constitutions, these states have limited authority over the local use of those funds. NASNA adds that states would have no visibility over how these funds are spent at the local level. NASNA suggests that in states where there is limited authority over local 911 fee collection or use, the Commission should require that local units report directly to the Commission, and the state should not be held accountable for any finding of diversion 11 The Illinois State Police support extending the definition of diversion but argue that the Commission should clarify that any local public agency that receives 911 fees from the 911 authority serving its jurisdiction is also responsible for the diversion of 911 fees. IL State Police Mar. 23, 2021
Comments at 2. Section 902 directs us to designate acceptable purposes and functions for the obligation or expenditure of 911 fees by any State or taxing jurisdiction. 47 U.S.C. 615a1f3A as amended; sec. 902c1C. Consistent with this, we clarify that taxing jurisdictions would be responsible for fee diversion occurring at the level of the taxing jurisdiction.

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