ITTA, NTCA, OPASTCO, RTG and WTA Call on Congress To Keep Universal Service Contribution From Skyrocketing

USAC Administrative Problem Will Hurt Consumers Throughout the Country

USAC Administrative Problem Will Hurt Consumers Throughout the Country

Washington, DC - Representatives from five national telecommunications Contact Caitlin Colligan at 703-351-2086trade associations, the Independent Telephone & Telecommunications Alliance (ITTA), the National Telecommunications Cooperative Association (NTCA), the Organization for the Promotion and Advancement of Small Telecommunications Companies (OPASTCO), the Rural Telecommunications Group, Inc. (RTG), and the Western Telecommunications Alliance (WTA) sent a letter to U.S. House and Senate leaders expressing grave concern about the consequences of the Federal Communications Commission’s conclusion that at least some universal service programs are subject to the federal Anti-Deficiency Act (“ADA”), as well as the possibility that the ADA might also be applied to the universal service High-Cost Fund and the Low-Income Fund.

Due to the application of the ADA to the E-rate and rural health care programs, the Universal Service Administrative Company (USAC) estimates that the universal service contribution charge on consumer phone bills would increase from the current 8.9% to 13.25% or more. Furthermore, if it is decided that the high-cost and low-income portions of the fund are subject to the ADA, the contribution factor could jump to 25% or more in the short term in order to generate the required “cash-on hand” as required by the ADA.

Allowing this policy to stand without remedial legislation would be very harmful to the rural consumer. The FCC and the Congress have a collective responsibility to address this ADA issue before it does irreparable harm to rural telecommunications companies and the communities they serve.

“We hope that when Congress returns in November you will be able to support efforts to include remedial language in any vehicle exempting universal service from the ADA,” the coalition of five telecom trade associations said.

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About ITTA: The Independent Telephone and Telecommunications Alliance is an alliance of 12 midsize telephone companies formed in 1994 to represent its members before federal telecommunications policymakers. ITTA members currently operate in 40 states and serve approximately ten million local customers.

About NTCA: NTCA is the premier association representing nearly 600 locally owned and controlled telecommunications cooperatives and commercial companies throughout rural and small-town America. NTCA provides its members with legislative, regulatory and industry representation; meetings; publications and educational programs; and an array of employee benefit programs. Visit us at www.ntca.org.

About OPASTCO: The Organization for the Promotion and Advancement of Small Telecommunications Companies (OPASTCO) represents more than 560 small, independently owned, local telecommunications companies serving primarily rural areas of the United States and Canada. OPASTCO’s membership includes both commercial companies and cooperatives, which range in size from fewer than 100 to 100,000 access lines, and collectively serve more than 3.5 million customers. OPASTCO represents rural telecommunications interests before federal regulatory bodies and Congress, provides publications, and holds two conventions annually in January and July of each year, addressing the needs of the small telecommunications industry. The association has an affiliate 501(c)(3) nonprofit, the Foundation for Rural Education and Development (FRED). Visit the OPASTCO Web site at www.opastco.org.

About RTG: RTG is a Section 501(c)(6) trade association dedicated to promoting wireless opportunities for rural telecommunications companies through advocacy and education. RTG’s members have joined together to speed delivery of new, efficient, and innovative telecommunications technologies to the populations of remote and underserved sections of the country. RTG’s members provide wireless telecommunications services, such as cellular telephone service and Personal Communications Services, among others, to their subscribers. RTG’s members are small businesses serving or seeking to serve secondary, tertiary and rural markets. RTG’s members are comprised of both independent wireless carriers and wireless carriers that are affiliated with rural telephone companies. Visit RTG on the Web at www.ruraltelecomgroup.org.

About WTA: The Western Telecommunications Alliance represents more than 250 rural telephone companies in 24 states west of the Mississippi. Most members serve less than 3,000 customers overall, and less than 500 customers per exchange. The Western Telecommunications Alliance aims to unite a diverse industry to deliver influence in the western states and in Washington D.C. that reflects our member importance in providing high quality telecommunications services for rural Americans. Visit the WTA Web site at www.w-t-a.org.