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Telephone tax hike part of FCC chairman's plan for Internet fund

Grant Gross | Nov. 18, 2014
A proposed US$0.16 fee increase on your telephone bill would go toward improving Internet access for kids in school and libraries.

A proposed US$0.16 fee increase on your telephone bill would go toward improving Internet access for kids in school and libraries.

About two-thirds of U.S. schools don't have the broadband speeds they need to provide digital learning services, Federal Communications Commission Chairman Tom Wheeler said Monday. Wheeler's proposal to revamp the 18-year-old E-Rate program, which helps schools and libraries pay for broadband infrastructure and services, would increase the agency's Universal Service Fund tax on each telephone line by up to $0.16 a month, from the current $0.99.

With 45 percent of U.S. schools lacking Wi-Fi capacity to deliver service to each student, the U.S. is not meeting its goal of providing adequate broadband to schools, Wheeler said during a press conference. "We must do better," he said. "Investing E-Rate is about our education system, it's about our economy, and it's about our global competitiveness."

While the proposal represents a tax increase, the additional cost for a year would amount to one cup of coffee or a medium soft drink at a fast-food restaurant, Wheeler said.

Wheeler's plan, to be debated during the FCC's Dec. 11 meeting, would increase the annual E-Rate spending cap from about $2.4 billion to $3.9 billion. The E-Rate program has not seen inflationary budget increases in 13 of its 18 years. The program would not reach the spending cap immediately, meaning fee increases may initially be lower than the targeted $0.16 a month, Wheeler said.

Adequate broadband speeds — which the FCC now defines as 100Mbps per 1,000 students — enables teachers to tailor lessons to students and gives student access to up-to-date information and multimedia not found in textbooks, Wheeler said.

About 41 percent of rural schools in the U.S. lack access to fiber broadband, while only 31 percent of non-rural schools don't have fiber access, Wheeler said. The broadband gap between rural and other schools is an "unacceptable situation," he said. "Today we're taking steps to ensure that all kids, no matter where they live, have access to high-speed Internet, by closing the rural fiber gap."

Wheeler's plan would phase out E-Rate support for traditional phone service and paging, while establishing a $1 billion-a-year target on spending for Wi-Fi services.

Wheeler's proposal would also allow schools and libraries to seek broadband service from providers other than their local telecom carriers, something E-Rate does not currently allow.

"It's time to give rural American schools an alternative beyond being held hostage by the actions or inactions of a local telecommunications provider," Wheeler said. "It is time to give rural American schools alternatives so they can connect their students to the same educational opportunities as other American students."

 

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