USF Contribution Factor Over Time

The chart below shows the steady increase over time within the FCC’s USF Contribution Factor, which is the percentage of interstate plus international end-user telecommunications revenues that telecommunications service providers must contribute to assistance the ever growing federal universal program fund. Today, the FCC announced the contribution factor has increased for that fourth quarter of 2014 by. 4 percent to 16. 1%. This means that American customers will pay a 16. 1% fee on a portion of their telephone bills for USF.

While there are a number of factors leading to this trend line, including shifting to a more explicit system plus shrinking revenues, this path is definitely clearly disturbing and unsustainable. The chart helps highlight that contribution reform is necessary. Also, I state my call for an overall budget cap on universal service, which can help limit the demand placed on the particular collection side.


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