USF Expansion Could Harm Small Businesses
The Universal Service Fund (USF) was set up in the 1996 Telecommunication Act to promote the availability of quality services at reasonable rates, increase access to advanced telecommunications services throughout the nation and advance the availability of services to all consumers. The 1996 act also states that all providers of telecommunications services should contribute to USF in some equitable, non-discriminatory manner. The purpose of the fund is to ensure that all schools, classrooms, healthcare providers and libraries have access to advanced telecommunications services.How the Universal Service Fund is supported financially has been in question due to new technology and what the future holds for the program. Currently, telecom carriers contribute approximately $5.4 billion per year to support universal service programs. Under the 1996 contribution rules, virtually all carriers that provide interstate telecommunications services must contribute. The FCC is working to reform contribution methods to help level the playing field by making sure that all classes of carriers contribute on an equitable basis and by addressing the need for an overall increase in the contribution factor.
NFIB members have expressed their displeasure with this tax; 77 percent of them stated that the Universal Service Fund should not be expanded to cover the cost of providing advance telecommunication services (such as broadband) to public hospitals, schools and libraries. NFIB will continue to work to ensure that the FCC does not reform or expand contribution methods in a manner that would harm small businesses.
