Statement of Bill Nelson Hearing: Universal Service

Statement

Statement of Bill Nelson Hearing: Universal Service

Mr. Chairman, thank you for holding this important hearing on the present and future of the Universal Service Fund.

Today, the Universal Service Fund fills a critical role by ensuring that all Americans have access to telecommunications services at affordable prices. The E-Rate program, for example, has ensured that almost all American students have access to the Internet. Similarly, the Low-Income program provides affordable telephone service that is truly a "Lifeline" for many families.

As we move towards the future, I look forward to exploring possible new uses of Universal Service funds, such as targeted support to bridge the urban-rural divide in broadband service penetration. Consumers in rural areas of Florida should have the same access to broadband services that consumers in urban areas, such as Miami or Tampa, have available.

At the same time, however, we must also take steps to preserve the financial stability of the Universal Service Fund. This reform should start with controlling the growth of the Universal Service Fund and, in particular, growth of the High-Cost portion of the Fund.

Unrestrained growth of the High-Cost portion of the Fund is causing an increased and substantial burden on consumers that pay into the Fund. Florida, for instance, is currently the largest net payer into the Fund - last year the State paid in more than $311 million more in contributions than it received in distributions.

We need to move towards a system that shares both the costs and benefits of Universal Service more equally among all Americans.

On the contribution side of the Universal Service equation, I look forward to reform that is sustainable, while still protecting low-volume and low-income consumers from any spike in the amount they currently pay into the Fund.

And on the distribution side, I look forward to hearing the details of various reform options - such as reverse auctions - that may limit unsustainable growth of the Fund.

Working together, we can create a Universal Service Fund that is technologically flexible, fair to consumers, and sustainable for the future.

Thank you.

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