USF Increase Shows Need for Reform, FSF Says
The FCC should cap the overall size of USF programs to protect consumers after the agency announced March 13 an increase in the program’s contribution factor to 17.4 percent for the second quarter of 2015, Free State Foundation's Seth Cooper…
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said in a blog post Monday. The contribution factor is up from 16.8 percent. “Reducing USF surcharges should go hand-in-hand with comprehensive reforms that reduce the overall size of the USF subsidy system and improve its efficiency,” he wrote. Wireless customers are hit hardest by USF increases, he said, saying the agency considers 37.1 percent of a wireless consumer's calling plan as interstate long distance and subject to the USF surcharge. Given the commission’s authorization of an E-rate increase of $1.5 billion annually, “it's hard to expect voice consumers will avoid even heavier USF surcharge burdens in the future,” Cooper wrote.