USF Contribution Reform

The Universal Service Fund (USF) was created by the FCC in 1997 to meet Congressional universal service goals as mandated by the Telecommunications Act of 1996. All providers of telecommunications services are required to contribute to the fund to help ensure that all Americans have access to telephone service, and that all schools, classrooms, health care providers, and libraries should, generally, have access to advanced telecommunications services.

As the FCC seeks to reform universal service funding, it is important that the contribution base be as broad as possible to include both telecommunications and broadband services, so that the fund will be more equitable for consumers and help lessen the growing burden on voice telecommunications providers and consumers.  In addition, both consumers and competition are at a disadvantage when competitive providers are expected to pay USF on leased special access inputs into a broadband Internet access service, while incumbents do not have to pay USF on these services at all.