Congressmen Boucher and Terry Introduce Latest Version Of USF Overhaul In "Discussion" Draft Legislation

(Excerpted from this week's Independent Report)

Representatives Rick Boucher (D-VA), the chairman of the House Subcommittee on Communications, and Lee Terry (R-NE), a member of the subcommittee, have released a discussion draft of legislation they hope to introduce soon to reform USF. Boucher and Terry have said they were working on a draft of USF reform legislation earlier this year and pledged to move the bill through the subcommittee by the end of summer. However, their efforts have been stymied by a lack of support by Representative Henry Waxman (D-CA), the chairman of the House Committee on Energy and Commerce, and other members of the committee. The committee’s agenda has been dominated this year by energy, environment, and health care legislation.

Boucher, Terry, and only a handful of other committee members have embraced USF reform as a way to promote the interests of rural America.

The legislation would make broadband a universal service. Boucher said the legislation, if introduced and passed by Congress, would require USF recipients to offer high speed broadband services within five years of the date of enactment. The legislation specified that providers must offer a download receiving rate of 1.5 mbps or greater. He also noted the legislation will help control USF costs by directing the FCC to adopt a competitive bidding process to determine which wireless carriers will be eligible to receive USF service.

The measure also would cap the total amount of USF for telecommunications service providers. USF would be capped at its current level plus an amount resulting from the switch to wire center averaging and the elimination of the parent trap. The cap would be subject to an annual growth factor that would be based on the annual percentage change in the total number of rural ILEC working loops plus the annual percentage change in the GDP-CPI. The legislation also proposes a one-time permanent increase in the cap if the FCC revises the intercarrier compensation regime and shifts some or all of access charge recovery into the USF.

The legislation would require providers to pay into the fund if they currently pay into the fund; if they use telephone numbers or IP addresses to provide real time voice communications in which voice is the primary function; or if they offer a network connection to the public. The FCC would be authorized to determine if the contribution methodology should be based on revenues, numbers, or a combination of the two.