WASHINGTON, D.C. (November 16, 2023) – WTA applauds Senators Markwayne Mullin (R-OK), Mark Kelly (D-AZ), and Mike Crapo (R-ID) for introduced S. 3321, the Lowering Broadband Costs for Consumers Act, legislation that requires the Federal Communications Commission (FCC) to embark on modernization of the Universal Service Fund (USF) contributions methodology. The bill would move USF funding away from relying on assessments on long-distance voice to broadband-based assessments.
“WTA supports this legislation to modernize the USF contributions system. It makes no sense to be assessing long-distance voice revenue to fund what is now a broadband-focused fund,” said Derrick Owens, Senior Vice President of Government & Industry Affairs. “This reform is much-needed and long-overdue. While the FCC has the authority to expand the contributions base to include broadband providers, it does not have the authority to assess companies that profit off a ubiquitous broadband network, such as large edge providers.”
The Lowering Broadband Costs for Consumers Act amends Section 254(d) of the Communications Act to require the FCC, within 18 months, to expand the USF contribution base so that broadband providers and edge providers “contribute on an equitable and non-discriminatory basis to the specific, predictable, and sufficient mechanisms established by the Commission to preserve and advance universal service.”
USF currently helps support the construction, operations, and maintenance of rural broadband networks, the subsidization of broadband connections for low-income Americans, and the connection of school, libraries, and rural health care institutions to the Internet. USF is funded by an assessment on telecommunications provider revenue from long-distance voice service. This revenue has been decreasing for over 15 years. The contributions factor, or the percentage assessment that gets passed onto voice customers, has been rising over that same time period, from just over 11% in 2007 to over 34% today.