Post-Election Outlook | The Post-Election Future of the Universal Service Fund

December 11, 2024

Reading Time : 2 min

The constitutionality of the Universal Service Fund (USF) funding mechanism is currently being litigated, and its future has long been the subject of debate in Congress. The U.S. Court of Appeals for the 5th Circuit found the funding mechanism unconstitutional, a holding that is in conflict with decisions from the U.S. Courts of Appeals for the 6th and 11th Circuits upholding the constitutionality of the program. The Supreme Court has accepted the case and will hear arguments in the coming months. Should the Supreme Court find the funding mechanism unconstitutional, Congress will need to step in to keep the program funded. Former Federal Communications Commission (FCC) Chairman Ajit Pai supports Congress appropriating the dollars to fund USF in order to escape the current situation in which the USF obtains “more and more money from a declining base of contributors.” There has been a bipartisan working group in Congress focused on reforming the program, but those efforts have yet to produce legislation. The most straightforward fix may be for Congress to move the funding to the regular appropriations process and fund it annually. However, defenders of the current program have argued that this will create uncertainty and make it difficult for carriers who depend on the funding to operate. Republicans have advocated for reforming the program and giving Congress more oversight, which would come with direct funding.

Additionally, Commissioner Brendan Carr has voiced support for expanding the contribution pool beyond traditional telecom providers and including online platforms. Commissioner Carr has noted that while Big Tech derives “tremendous value from the federal government’s universal service investments – using those federally supported networks to deliver their products and realize significant profits – these large corporations have avoided paying a fair share into the program.” By requiring traditional telephone customers to contribute to a fund that is “increasingly used to support broadband networks,” Commissioner Carr has argued that the FCC’s current approach is “the regulatory equivalent of taxing horseshoes to pay for highways,” suggesting that Congress should require Big Tech companies “to start contributing an appropriate amount.” Commissioner Carr has conceded that an act of Congress would be necessary to accomplish this, as the FCC presently has no jurisdiction to do so on its own.

Share This Insight

Previous Entries

Interconnected TMT

July 3, 2025

Chairman Carr delivered a speech in Sioux Falls, South Dakota, on July 2 titled “A Build Agenda for America” in which he laid out the FCC’s priorities for the remainder of President Donald Trump’s term. In citing to what he refers to as President Trump’s “new Golden Age for America,” Chairman Carr indicated he believes the telecommunications sector needs reform through his Build America Agenda. This agenda aims to create new growth and opportunity in telecommunications, helping the United States surpass global competitors.

...

Read More

Interconnected TMT

June 25, 2025

On Monday, June 23, the Federal Communications Commission (FCC) issued a public notice announcing comment and reply comment deadlines for the Identifying Foreign Adversary Ownership Stakes Notice of Proposed Rulemaking (Foreign Ownership NPRM). Comments will be due on July 23, and replies will be due on August 22.

...

Read More

Interconnected TMT

June 24, 2025

President Donald J. Trump has taken action to bolster the American drone industry and safeguard U.S. airspace with the signing of two critical executive orders. Entitled “Unleashing American Drone Dominance” and “Restoring American Airspace Sovereignty,” these orders underscore the administration’s commitment to harmonizing national security and technological progress.

...

Read More

Interconnected TMT

June 16,2025

On June 5, the Federal Communications Commission (FCC) released a tentative agenda for its next Open Meeting, which is scheduled to take place on Thursday, June 26 at 10:30 AM ET. This release occurred a day before Commissioners Simington and Starks stepped down from their roles at the FCC, leaving the Commission with only two sitting commissioners—Chairman Carr and Commissioner Gomez. A quorum of three commissioners is required in order for the FCC to conduct Commission-level business. While the Commission will be able to continue with bureau-level proceedings, the lack of quorum raises legal and practical questions about the Commission’s ability to adopt new rules, such as the rules contained in the two draft Report and Orders below. Quorum, however, can be regained if Congress can confirm President Trump’s nominee, Olivia Trusty, as a new Republican Commissioner prior to the June Open Meeting. Recognizing this, on June 12, Senate Majority Leader Thune filed a “notice of cloture” that will allow the Senate to debate, and then vote, on Trusty’s nomination by the end of next week. Trusty’s appointment would allow the Commission to act on three items that are expected to be considered at the Open Meeting, which are detailed below:

...

Read More

Interconnected TMT

June 11, 2025

On June 6, 2025, the Commerce Department issued new guidance in the $42.5 billion Broadband, Equity, Access and Deployment (BEAD) program. The guidance, titled the “BEAD Restructuring Policy Notice,” introduces many significant changes to the broadband deployment subsidy program, most notably:

...

Read More

Interconnected TMT

2025-06-03

The Federal Communications Commission (FCC) held its May Open Meeting on Thursday, May 22, during which it voted to adopt three items: (1) a Notice of Proposed Rulemaking (NPRM) that proposes to require holders of certain Commission-issued licenses, authorizations or approvals to certify whether they are owned by, controlled by or subject to the jurisdiction or direction of a foreign adversary; (2) a Report and Order and Further Notice of Proposed Rulemaking (R&O/FNPRM) that aims to strengthen requirements and oversight relating to telecommunications certification bodies (TCBs), measurement facilities (test labs) and accreditation bodies; and (3) a FNPRM seeking comment on ways that the 12.7-13.25 gigahertz (GHz) and 42.0-42.5 GHz bands could be used more intensively for satellite communications.

...

Read More

Interconnected TMT

May 13, 2025

On April 22, 2025, the NTIA issued a Notice of Programmatic Waiver (Waiver Notice) providing a 90-day extension of the Final Proposal deadline in the Broadband Equity, Access and Deployment (BEAD) program. The issuance of the Waiver Notice signals that the Department of Commerce is pressing forward with its review of the BEAD program. The Waiver Notice also provides additional clues about the nature of the changes that the Department is contemplating for the BEAD program.

...

Read More

Interconnected TMT

May 8, 2025

On May 9, President Donald Trump declared the Digital Equity Act unconstitutional and announced that he would be immediately “ending” the programs created under the law.

...

Read More

© 2025 Akin Gump Strauss Hauer & Feld LLP. All rights reserved. Attorney advertising. This document is distributed for informational use only; it does not constitute legal advice and should not be used as such. Prior results do not guarantee a similar outcome. Akin is the practicing name of Akin Gump LLP, a New York limited liability partnership authorized and regulated by the Solicitors Regulation Authority under number 267321. A list of the partners is available for inspection at Eighth Floor, Ten Bishops Square, London E1 6EG. For more information about Akin Gump LLP, Akin Gump Strauss Hauer & Feld LLP and other associated entities under which the Akin Gump network operates worldwide, please see our Legal Notices page.