Commitment Adjustment and Recoveries

Commitment Adjustment (COMAD)

If USAC discovers that certain funds have not been committed and/or disbursed in accordance with all federal, regulatory, FCC and ECF Program rules, the Federal Communications Commission (FCC) requires USAC to rescind those commitments and recover funding that has been improperly disbursed. USAC refers to this process as the Commitment Adjustment (COMAD) process. If a COMAD action is necessary, USAC provides both the applicant and the service provider with a Commitment Adjustment (COMAD) letter. The COMAD letter includes an Adjustment Report which lists the Funding Request Number(s) (FRNs), FCC Form 471 Application Number, Billed Entity Number (BEN), and Service Provider Identification Number (SPIN) impacted by the COMAD action. The COMAD letter also includes an explanation for the COMAD action.

If the applicant and/or service provider wants to appeal this decision, information on how to prepare and submit an appeal is included in the letter.

If the amount of funds disbursed to date exceeds the adjusted funding commitment amount, FCC rules require USAC to recover the funds disbursed in error.

USAC seeks recovery from the party responsible (service provider, applicant, or both parties) for the COMAD action or rule violation. USAC copies the other affected party on the COMAD letter.

Recovery of Improperly Disbursed Funds (RIDF)

When USAC discovers that funds were disbursed in error, but the decision to commit the funds was correct, USAC will seek recovery of the improperly disbursed funds (RIDF). For example, if USAC paid an invoice that included ineligible products or services along with the approved, eligible products and services, USAC would seek recovery for the costs of the ineligible items. The commitment may not need to be adjusted when it is determined that a RIDF action is necessary. If a RIDF action is necessary, USAC provides both the applicant and the service provider with a RIDF letter. The RIDF letter includes an ECF Recovery Report which lists the FRNs, FCC Form 471 Application Number, BEN, and SPIN impacted by the RIDF action. The RIDF letter also includes an explanation for the recovery action. Once the improperly disbursed funds are returned to USAC, USAC will resume paying invoices submitted for that FRN’s approved, eligible products and/or services.

After you receive a COMAD or RIDF letter

You have 30 days from the date of the COMAD or RIDF letter to file an appeal with USAC if you disagree with the commitment adjustment and/or recovery decision. Please see USAC’s ECF Appeals page for more information on filing an appeal or requesting a waiver from the FCC. If your appeal is not successful, you will have 30 days from the date of USAC’s appeal decision to file an appeal directly with the FCC.

Demand Payment Letters and Red Light

If funds need to be recovered, applicants and/or service providers who do not file an appeal within 30 days or are unsuccessful in their appeals or waiver requests, are issued a Demand Payment Letter providing an opportunity to pay the debt.

If the debt is not paid within 30 days, the applicant and/or service provider will be subject to the FCC’s red light rules and may eventually face:

  • Holds and dismissal of pending ECF and E-Rate FCC Form 471 applications,
  • Holds and dismissal of pending invoices for the at fault applicant or service provider,
  • Ineligibility for participation in ECF, E-Rate, and other USF programs, until the debt is paid,
  • Transfer of the debt to the U.S. Treasury for collection, and
  • Interest and other fees.

Note for consortium applications: Entities that are on Red Light and are recipients of services on a consortium application are not eligible to receive funding through the consortium application or as an individual applicant. These entities will be removed as a recipient of service from the consortium application prior to funds being committed for that application.

How to Pay (if you received a Demand Payment Letter)

To pay a debt, please use the instructions provided on the FCC’s Commission Registration System (CORES) webpage.

For further information on the Debt Collection Improvement Act (DCIA),  the Treasury, and FCC debt collection regulations implementing the DCIA, please see 31 U.S.C. § 3701, et seq., 31 C.F.R. § 900.1, et seq. and 47 C.F.R. § 1.1901, et seq.

Payment of debt cannot be made until a Demand Payment Letter is received. The Demand Payment Letter will provide the bill number to reference in the FCC’s CORES system (see screenshot below).

Voluntarily Returned Funds will be handled in the same form as other recoveries discovered in the ECF Program. If you are voluntarily returning funds, please Contact USAC’s Customer Service Center (CSC) at (800) 234-9781 for further assistance.

demand payment letter screenshot