New CBO Report on Universal Service Fund

FACTORS THAT MAY INCREASE FUTURE SPENDING FROM THE UNIVERSAL SERVICE FUND
[SOURCE: Congressional Budget Office, AUTHOR: Philip Webre]
To encourage greater access to telephone and other telecommunications services, the Universal Service Fund (USF) provides financial support to some producers and consumers of those services. Spending for USF programs rose by 50 percent between fiscal years 2000 and 2005. Much of that increase went to support companies that offer telephone service in rural locations and other areas where the cost of providing such service is higher than the national average. This Congressional Budget Office (CBO) paper -- prepared at the request of the Senate Budget Committee -- examines recent trends in spending by the USF’s High-Cost Program, which subsidizes telecommunications providers in high-cost areas. The paper examines factors that may increase such spending in the future and discusses options to restrict the growth of outlays. In keeping with CBO’s mandate to provide objective, impartial analysis, this report makes no recommendations.
http://www.cbo.gov/ftpdoc.cfm?index=7291&type=1