FCC Inspector General Reverses Universal Service Fund Low Income Program Decision

The Federal Communications Commission Inspector General Tuesday reversed a decision that some $1.6 billion in Universal Service Fund payments to the Low Income Program in 2006-2008 were "100% erroneous." A December 2008 decision by the Inspector General under then-FCC Chairman Kevin Martin put the entire low-income fund "at risk" under Office of Management and Budget accounting standards, the IG's office had said at the time. On Tuesday, the IG withdrew that decision and said the program would be audited for potential waste, fraud and abuse. Acting Inspector General David Hunt pointed out that the previous IG determination had been based on the fact that source documentation could not be supplied to verify the amounts handed out and based on interpretation of OMB guidance. But since that December report, he points out, the Universal Service Administrative Company has responded to that Inspector General finding. Given that the Inspector General did not conduct an audit or "other structured examination," Hunt said his office had decided to withdraw that finding that the payment was totally off.