FCC Report Shows USF Revamp Urgently Needed, Barton Says
An FCC report showing that the universal service high- cost fund rose to $4.5 billion in 2008 from $1.3 billion in 1997 highlights the need for change, the House Commerce Committee’s ranking member, Joe Barton of Texas, said Friday. The fund is a “bloated government program in serious need of reform,” Barton and Communications Subcommittee ranking member Cliff Stearns of Florida said in a written statement. The FCC submitted the report in response to an April request from the committee’s Democratic and Republican leaders.
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Barton has long been a fierce critic of the program’s growth. “It is unreasonable to expect subscribers to pay more than 11 percent of their long-distance phone bills to subsidize scores of telephone providers in each geographic market, especially when other providers are serving the same markets without a penny of support,” his statement said. Verizon said Thursday consumers will start paying a 12 percent surcharge in the next quarter (CD June 6 p1). The report shows companies received subsidies up to $16,834 a phone line from the high-cost program last year. Under FCC rules, all providers are eligible to receive support at the same rates regardless of the actual costs of providing service, Barton said.
“The goals of universal service are as important now -- in the age of broadband -- as they have ever been,” said a statement from Chairman Henry Waxman, D-Calif., of the Commerce Committee. “The Universal Service Fund, however, must be completely transparent. USF dollars are collected from consumers, and the American public should know exactly where its money is going.” The study will help the committee start a review of the program, Waxman said.
The report shows trends similar to those in information that the commission provided Waxman last year when he was the Oversight Committee’s chairman, Communications Subcommittee Chairman Rick Boucher of Virginia told us. He said he hopes to soon complete work on legislation to remake the universal service program, working partly from his efforts last Congress with Rep. Lee Terry, R-Neb., and also from information from stakeholders and testimony gathered at a March on hearing on USF (CD March 13 p1) “We are very close to have a measure that will achieve” support from a majority of members, he said.
The new report showed that AT&T, Alltel and Verizon paid the most into the fund of any providers in 2008, about $1.15 billion in total. The largest per-line subsidy was in Beaver Creek, Wash., where the local phone company received $454,524
- more than $16,800 for each of the 27 lines the company provides. Others areas listed as among the highest in support per line in 2008 included Texas, Hawaii, Alaska, Michigan, Arizona, Oklahoma and Colorado.
States with among the most eligible telecommunications carriers in 2008 included Iowa, Mississippi, Nebraska, Alabama, West Virginia, Iowa, Kentucky and Wisconsin, the report said. The Kalona Cooperative Telephone Co. in Iowa received $368.24 in USF per-line support for about 2,000 lines on average in 2008, it said. CenturyTel received $105.29 per line in Wisconsin for just more than 47,000 lines, according to the report.