Texans living in sparsely populated areas are under the threat of losing telecommunication services after the state made a cut on subsidies that help internet and phone service providers offer services in rural areas of Texas. Providers like HughesNet, GotW3, and Verizon will take a big hit if the funding is reduced.
The Texas Universal Service Fund (or T-USF), was created to reimburse telecommunication companies for providing phone and internet service in these areas, but due to the inability to adapt to new times, the fund has been bleeding money for the past 5 years.
The T-USF subsisted since its creation thanks to a 3.7% assessment or tax on voice calls, which was lowered by the commission to 3.3% during 2015. Also, the evolution of communication technologies like internet-based voice calls has been slowly depleting the fund throughout the years.
This problem has reached a breaking point this January, when the Public Utility Commission (PUC), overseeing the fund through a neutral third party, issued a statement where they say that only 30% to 40% of service costs could be reimbursed to these telecommunication companies for their services.
This has forced several companies to stop expanding their networks to the more sparsely populated areas of Texas, but it has also affected their ability to maintain already existing lines, as stated by Rusty Moore, CEO of Big Bend Telephone Co. and President of the Texas Telephone Association. He expressed his concern about possible small telecommunication business bankruptcy.
“These are critical infrastructure networks (…) 911 could be threatened. All emergency services along the borders (…) for Big Bend, we serve quite a bit of border security (…) the mechanisms, the investments in the networks that we’re able to make are truly in jeopardy, immediately. And we are already seeing that reduction.” Moore stated.
Companies and lawmakers from all around the state asked for the commission to increase the tax rates on voice calls or apply it to other services in order to maintain the fund stable, thus ensuring service for rural areas, and even some urban and suburban areas that were rural a few years ago, but that are also threatened by these problematic.
James White, a state representative stated the following: “If we want to continue to pull ourselves out of this COVID economic ditch, we’re going to have to make sure that East Texas, and all of rural Texas, is connected to the entire world.”
Also, when asked about the possible ramifications that this problem could have, he said: “We have seniors who are relying on good internet connections for medical care; we have teachers and students that are relying on this for education; we have mental health providers that are relying on good connections.”
Other services such as Relay Texas, which helps connecting people with hearing and speech disabilities, and Lifeline, which helps low-income citizens afford basic telephonic services, are also threatened by this since the fund also pays their expenses.
This whole problem has led several companies (including Moore’s) to fill a lawsuit against the fund commission. They affirm that the commission is violating several Texan laws when it reduced the funding.
State representatives R-Canadian and Ken King filled a bill for this legislative session to allow the commission to charge for internet-based voice-calls, in order to try and keep the fund alive through another source of income. Since this is an urgent matter for more than a million Texans, this bill could be pushed as an emergency measure, as stated by state representatives Travis Clardy and R-Nacogdoches.
“We do not need the program to go under for lack of funds. That would be tragic, it would be unnecessary, and it would be extraordinarily short-sighted.” Said Clardy.
Nevertheless, the former executive director of the commission, John Urban, said in a letter that the commission did not have any contingency plan for this situation.
What do you think of this matter? Do you know any person, family, service, or company that is or could be affected by the depletion of the fund? Please, let us know in the comments.