Universal Service Fund Contribution Dip, Letter to Appoint Fifth FCC Commish, Texas Broadband Bill

June 15, 2021–The Federal Communications Commission said late last week the Universal Service Fund contribution has decreased from the previous quarter by nearly 2 percent.

The contribution is now at 31.8 percent of voice revenues. The fund, which draws on revenues from voice services and has reached record highs recently, is used to bankroll telecommunication services in rural areas, subsidize service to low-income Americans and institutions such as schools, libraries and healthcare facilities across the nation.

It collects nearly $10 billion a year, but its high quarterly contribution – a result of a dwindling voice services revenue – has sparked debate as to how to sustain it.

FCC Commissioner Brendan Carr floated last month in a Newsweek op-ed that big technology companies that benefit from internet service should contribute equitably to it. “Doing so would put the federal government’s universal service efforts on stable footing.”

In response to Carr’s piece, FCC’s Acting Chairwoman Jessica Rosenworcel said the idea to tax big tech was “intriguing” and that the regulator should be “open to new ideas.”

White House Urged to Appoint Fifth FCC Commissioner

A number of advocacy groups signed a letter to President Joe Biden and Vice President Kamala Harris on June 11 urging the appointment of a fifth FCC commissioner.

“Given the legislative calendar and the diminishing number of days for hearings and confirmation votes, we have reached a critical point to guarantee the agency charged with ensuring affordable communications access can do its work during your administration,” the letter said.

Currently, the FCC is split with two Democrats and two Republicans, with major decisions, including on net neutrality, hanging in the balance. Republican Commissioner Michael O’Reilly vacated the fifth seat in December 2020 after his nomination to continue as commissioner was withdrawn by the Trump White House in August over a row about social media liability.

In early April, over 100,000 people signed a petition urging Biden to quickly break the FCC deadlock.

The letter said a delay in appointment is “incompatible with the goal of delivering open, affordable, and reliable high-speed broadband to every home.”

Texas Broadband Office Will Help Avoid Overbuilding

In a blog post, the Institute for Policy Innovation said the Texas legislature’s pursuit of a dedicated office to oversee improvements in broadband deployment in the state could help ensure consistency of access and an avoidance of overbuilding.

Late last month, the Texas legislature passed House Bill 5, which will expand broadband service to certain areas. Beside creating a broadband development office, it also requires statewide broadband plan within one year of the bill becoming law. Sponsored by east Texas Republican Trent Ashby, the bill now goes to Governor Greg Abbott’s desk for signing.

The IPI notes that other governments that have set up broadband initiatives have often entered into failed partnerships with private companies.

“Such government overbuilding is worse than doing nothing because it spends taxpayer dollars, reaches few truly unserved households, competes with the private sector, and destroys the value of existing infrastructure,” the post said.

Some nine million Texans don’t have broadband internet, according to a Texas Tribune report in March.

Most states have adopted a statewide broadband plan, except for a handful including New Jersey, Kentucky, South Carolina, and Texas.