The current funding mechanism for the Federal Communications Commission’s (FCC) Universal Service Fund (USF) is under significant duress. The revenues subject to USF assessment have declined 63 percent in the last two decades, and in turn the contribution factor has risen dramatically, placing inequitable burdens on certain consumers and businesses and calling into question the sustainability of the USF programs. But there are solutions readily available to stabilize and save the USF which will ensure families, schools, hospitals, and rural communities stay connected to broadband and voice communication services. That is the message in a new paper from USF expert and former FCC official Carol Mattey, being presented by the Schools, Health & Libraries Broadband (SHLB) Coalition, INCOMPAS, and NTCA-The Rural Broadband Association.
The new paper, USForward, details how the FCC can take a smart, sustainable approach to contributions reform. Warning of a 40 percent contribution factor by 2025, the paper details the options the FCC has to address this problem now. It analyzes the real facts about the decline in USF revenues, debunking myths about landline use and highlighting activity by current providers that impact the program’s bottom line. Considering possible solutions, the paper makes the case for adding broadband internet access service revenues as a means of stabilizing the USF program to meet its mission and future goals. If the Commission does so, the paper projects that the contribution factor would fall significantly and remain under 4 percent over the next several years. Ms. Mattey makes the case why this option is the best way forward to modernize and stabilize USF for the future.
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26 pages; PDF.
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