Universal Service Fund Update

By Darlene Campbell

March 2008

The Universal Service Fund (USF) was created in 1997 to meet the goals of Universal Service as mandated by the Telecommunications Act of 1996.  The 1996 Act states that all providers of telecommunications services should contribute to a federal universal service fund in some equitable and nondiscriminatory manner; there should be specific, predictable, and sufficient federal and state mechanisms to preserve and advance universal service; and all schools, classrooms, healthcare providers, and libraries should generally have access to advanced telecommunications services.

To pay for this fund, it was initially determined that the telephone companies must pay into it on a revenue-based system.  In 2003, discussions began about changing the contributions side to a “numbers-based methodology.”  Kevin Martin, the FCC chairman, likes this idea and has suggested a proposed change.  The change would assess a monthly fee of anywhere from $1.20 to $1.60 per unique telephone number, including DID (Direct-Inward-Dial) numbers.  Considering the quantity of DID numbers that many teleservice call centers have, this numbers-based methodology change could generate a significant cost increase for many call centers of up to several thousands of dollars.

This proposed change will affect everyone in the telecommunications industry, so you should be concerned about it.  To address this, ATSI is in Washington taking an active role against this legislation.  We are actively engaged with members of Congress and their staffs, alerting them about how the proposed change will negatively impact telemessaging call centers, which typically have a great amount of DID numbers.  ATSI recently held meetings at the Federal Communications Commission to alert them of the impact that a straight numbers-based methodology will have.

Additionally, ATSI has been conducting Legislative Boot Camps since last summer.  These are intense training sessions on how to schedule, plan, and conduct a meeting with your legislators in their Washington or home district office.  The training sessions inform and teach attendees about the message that needs to be conveyed regarding the burden the proposed change will put on individual call centers and how unfair the proposed change is to our industry.  Next, ATSI will be conducting Webinars on how to contact legislators, as well as teaching “message management,” so we are all on the same page in discussing the impact of this USF change on call center costs.

ATSI is fighting the proposed changes to the USF by encouraging a grassroots campaign via email, letters, and phone calls to members’ congressional representatives.  ATSI has hired a professional DC lobbying firm, Miller/Wenhold Capitol Strategies, to assist in accomplishing our goals. 

The proposed “by-the-numbers methodology” computation of USF funding will impact call center viability in a very negative manner.  A committee of ATSI members has researched the issue and discovered that the average telemessaging call center can expect to pay approximately $3,000 more per month if the proposed change is passed and implemented as suggested by the FCC. 

While the bills in Congress that address these issues have languished, we know that S101 or some other USF legislation could be attached to another bill and sail right through with little discussion.  Alternately, the chairman of the FCC, Kevin Martin, could decide that it is time to move forward with implementing the numbers methodology for contributions as part of his legacy as FCC chairman.  We know that Mr. Martin endorses this form of contributions.  Mr. Martin, as well as the large telephone companies, believe that it makes good economic sense and that the process is easy to manage.  Unfortunately for our industry, this computation process will be burdensome and wholly unfair.

This is the reason that ATSI is asking you to make the time to take two action steps to help the industry in fighting this battle. 

Action Step 1: We encourage you to write your representatives, tell them how unfair and burdensome the “by-the-numbers” methodology is and how the proposed change will negatively affect your business.  Take action now by writing to your members of Congress.  It is as simple as following this link: www.congressweb.com/cweb4/index.cfm?orgcode=atsi.

Action Step 2: Help us by participating in an upcoming survey that the ATSI “Fight USF Team” is designing to get more up-to-date information about our industry and our telephone number usage.  Our plan is to share this information with the FCC to illustrate the negative impact this change will have on our businesses.  We must immediately work on documenting our position in the USF rulemaking at the FCC, so there is evidence to support an exemption for our industry if the FCC proceeds with the numbers-based rule making this year.  We must collect more information about our industry’s profile and number usage to bolster our arguments.

You can make a difference by simply writing, emailing, calling, meeting, or faxing your representative.  Remember, this is about your money; if you don’t take action, who will?

Darlene Campbell is ATSI’s Legislative Advocacy Committee chair; for more information about ATSI, visit http://www.atsi.org/atsi/Default.asp.