As more electric co-ops deploy broadband, many are relying on federal broadband funding from the FCC's Universal Service Fund (USF) to bring high-speed service to their most rural and remote member-owners. Of the estimated 200 electric cooperatives that are in the broadband business more than 115 are participating in at least one of the USF programs, whether it be the Connect America Fund (CAF) Phase II, the Rural Digital Opportunity Fund (RDOF), Schools and Libraries, Rural Health Care or Lifeline (Low-income) program.
However, the long-term sustainability of the USF is in question due to an outdated contribution methodology that is not aligned with shifts in communications revenues as consumers have migrated to new services and platforms to communicate. Contributions reform is long overdue. A recent report outlines the growing problems with the current methodology and evaluates proposals to update the contributions mechanism to ensure the long-term viability and sustainability of the fund.
