Gov’t, private sector balk at US Court’s rebuff of Universal Service Fund’s legitimacy
The ruling puts at risk essential communications services for millions of rural and low-income people.
In the wake of a decision by the U.S. Court of Appeals for the Fifth Circuit declaring the long-standing Universal Service Fund (USF) as unconstitutional, several private-sector groups and the Federal Communications Commission (FCC) have come to the defense of the mechanism that since 1996 has assisted low-income customers by helping to pay for monthly telephone charges.
The court decided in favor of a petition filed by Consumers Research, a conservative advocacy group that challenged the FCC’s practice of collecting a fee from telecom providers — including those operating in Puerto Rico — who then pass the cost on to their customers.
Last week, the Fifth Circuit in New Orleans ruled, 9-7, that the USF is unconstitutional as currently administered. The immediate implications of the decision are unclear, The Washington Post reported.
In a statement, FCC Chairwoman Jessica Rosenworcel said the decision “is misguided and wrong.”
“It upends decades of bipartisan support for FCC programs that help communications reach the most rural and least-connected households in our country, as well as hospitals, schools and libraries nationwide,” she said.
“The opinion reflects a lack of understanding of the statutory scheme that helped create the world’s best and most far-reaching communications network. We will pursue all available avenues for review,” she added, which likely means the case will be escalated to the U.S. Supreme Court.
Meanwhile, the Competitive Carriers Association, NTCA – The Rural Broadband Association, and USTelecom – The Broadband Association released a joint statement reacting to the decision.
“The Universal Service Fund has been, and continues to be, a critical tool to narrow the digital divide and help address connectivity gaps,” the groups stated.
“The court’s decision … deals a severe blow to these efforts and could put at risk the availability and affordability of essential communications services for millions of rural Americans, low-income consumers and community anchor institutions. We steadfastly believe that the Universal Service Fund is constitutional, and we will continue to fight for universal connectivity,” the groups stated.
Meanwhile, FCC Commissioner Geoffrey Starks said to be “gravely disappointed” by the ruling.
“The en banc decision overturns the original panel’s well-reasoned decision and runs contrary to two Circuit courts — the 6th and 11th — that recently found the USF to be constitutional,” Starks said.
“This decision is a monumental blow in our long-running effort to close the digital divide and will particularly harm Americans that rely on USF for connectivity including vulnerable households, those that live in rural areas, and our youngest learners,” he said.
“I am reviewing the decision and how the agency can continue to fulfill one of the core mandates of the Communications Act: universal service,” Starks added.
