NEWS
Federal Communications Commission
445 12th Street, S.W.
Washington, D. C.  20554
This is an unofficial announcement of Commission action.  Release of the full text of a Commission order constitutes official action.
See MCI v. FCC. 515 F 2d 385 (D.C. Circ 1974).
News Media Information 202 / 418-0500
Internet: http://www.fcc.gov
TTY: 1-888-835-5322
FOR IMMEDIATE RELEASE: NEWS MEDIA CONTACT:
May 1, 2008 Mark Wigfield, 202-418-0253
Email: mark.wigfield@fcc.gov
FCC TAKES ACTION TO CAP HIGH COST SUPPORT                                           
UNDER THE UNIVERSAL SERVICE FUND 
Interim Cap Will Keep Costs Down For Consumers Pending Comprehensive Reform
Washington, D.C. – The Federal Communications Commission today adopted an interim 
cap on payments to competitive eligible telecommunications carriers (ETCs) under the Universal 
Service Fund (USF).  The Commission’s actions are intended to stem the explosive growth of 
USF while the Commission pursues comprehensive reform of the program. 
Total annual support for competitive ETCs will be capped at the level of support that they 
were eligible to receive in each state during March 2008.  
Currently, consumers pay more than 11 percent in USF fees on their interstate phone 
bills.  Growth in contributions to the fund is largely attributable to competitive ETCs, who 
receive USF support based not on their actual costs, but on the costs of the incumbent provider, 
even if the competitive ETC’s costs of providing service are lower.  USF payments to 
competitive ETCs have grown from approximately $1.5 million in 2000 to more than $1 billion 
in 2007.  Left unchecked, this staggering growth threatens the sustainability of the USF program 
and forces consumers to pay excessive and ever-increasing contributions to the fund.  
The order contains limited exceptions from the cap:  Competitive ETCs serving tribal 
lands or Alaska Native regions may continue to receive traditional support at uncapped levels for 
serving those historically underserved areas.  Also, competitive ETCs that file their own cost 
data may obtain an exemption from the cap.  Finally, the order addresses a number of pending 
competitive ETC petitions, while making clear that such petitions will not increase the amount of 
the adopted cap.
Action by the Commission, April 29, 2008, by Order (FCC 08-122).  Chairman Martin, 
Commissioners Tate and McDowell, with Commissioners Copps and Adelstein dissenting.  
Separate statements issued by Chairman Martin, Commissioners Copps, Adelstein, Tate and 
McDowell.
Docket Nos.:  05-337, 96-45
Wireline Competition Bureau Staff Contact:  Ted Burmeister at 202-418-7400
-FCC-
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