GAO Report Underscores Sen. Cruz’s Concerns Over Wasteful Broadband Spending and Hidden Phone Bill Tax
The Government Accountability Office (GAO) released a report requested Sen Ted Cruz (R-TX) that found the Universal Service Fund (USF) operator is burning through cash with only minimal government oversight of its budget. The report confirms the need for greater Congressional oversight of the USF as Sen. Cruz laid out in his Blueprint for Universal Service Fund Reform, published last year. Most significantly, the report’s findings underscored Sen. Cruz’s call for greater accountability of a hidden regressive tax on Americans’ phone bills. On May 10, 2023, Sen. Cruz asked GAO to probe the private non-profit, the Universal Service Administrative Company (USAC), -which operates USF-funded programs meant to expand high-speed Internet access. According to the GAO’s findings, USAC’s operational costs have surged by 27.5% over the past five years, with 2023 expenses reaching nearly $248 million—an amount that is almost half of the FCC’s 2023 annual budget of $514 million. This represents a growing share of the total USF tax, with USAC’s administrative costs rising from 2.2% in 2018 to 3% in 2023, surpassing the typical 2% cap set by Congress for administrative expenses.
GAO Report Underscores Sen. Cruz’s Concerns Over Wasteful Broadband Spending and Hidden Phone Bill Tax