FCC to propose revamping Universal Service Fund

Federal regulators trying to bring high-speed internet connections to all Americans will propose tapping the government program that now subsidizes telephone service in poor and rural areas, reports the Associated Press. The Federal Communications Commission will include a proposal to revamp the Universal Service Fund (USF) as part of a national broadband plan due to Congress on March 17. Although the proposal itself has been expected for months, the agency’s March 5 announcement offered the first solid details. The FCC said it envisions transforming the USF over the next decade to pay for high-speed internet access instead of the traditional voice services that it currently finances. The proposal would create a Connect America fund inside the Universal Service program to subsidize broadband, and a Mobility Fund to expand the reach of so-called 3G, or third-generation, wireless networks. “It’s time to migrate this 20th-century program,” said Blair Levin, the FCC official overseeing the broadband plan, which was mandated by last year’s stimulus bill. The FCC’s announcement focused only on the traditional high-cost, low-income portion of the USF, which also pays for the e-Rate, a $2.25 billion-a-year program that provides telecommunications discounts to eligible schools and libraries. The FCC’s plan will lay out several options to pay for the proposals it outlined March 5, including one that would require no additional money from Congress and one that would accelerate the construction of broadband networks if Congress approves a one-time injection of $9 billion. Either way, Levin said, the proposals would not increase the annual size of the USF, but instead would take money from subsidies now used for voice services…

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