WASHINGTON-Even as government tries to figure out how to alter universal service funding to make it viable, the part of the fund that pays to connect schools and libraries to the Internet is under its own scrutiny.
The Senate Commerce Committee is trying to protect the USF/E-rate from an accounting change it believes would hurt the service, while the House Commerce Committee chairman said the E-rate program is “just putting money down a rat hole.”
The Senate Commerce Committee held a hearing on a bill that would permanently exempt the E-rate program from the Anti-Deficiency Act. Payments to the much-derided E-rate program were suspended last year when the program could not follow generally accepted accounting principles. Congress intervened temporarily so payments could continue.
Now Sen. Ted Stevens (R-Alaska), chairman of the Senate Commerce Committee, has co-sponsored a bill to permanently exempt the E-rate.
While wireless carriers are not generally recipients of E-rate funds, the brouhaha over the E-rate/ADA caused the telecom industry to fear drastic increases in universal-service contributions and/or application of the ADA to the high-cost fund, which is used to subsidize rural telephone service. Wireless carriers have recently become recipients of the rural subsidies.
Just a day after the Senate Commerce Committee lauded the E-rate program, Rep. Joe Barton (R-Texas), a consistent critic, said he wanted to get rid of it.
“I have been in Congress 21 years, and I haven’t seen a more mismanaged program. If I had to vote today, I would vote to abolish it-period. If I can change it, I will. If I have the votes to kill it, I will. If I can’t do either of those things, then I will so underfund it that it ceases to exist,” Barton told a luncheon of communications lawyers.
Barton said that the subsidies that many school districts have received to maintain and upgrade existing systems are not the responsibility of the federal government. At the Senate Commerce Committee hearing, one of the witnesses from Louisiana proudly said her school district did use the E-rate for such purposes.
Also at the Senate Commerce Committee hearing, Stevens rejected a proposal by the Government Accountability Office that Congress exempt the USF from the ADA for only two years. Stevens said that two years would not be sufficient, and he would rather suspend the application of the ADA until a legislative fix can be found.
