Contribution Factor
In a Public Notice released on December 14th, the Federal Communications Commission (“FCC”) announced that the Universal Service contribution factor for the 1st quarter of 2012 (January 1 – March 31, 2012) will increase to 17.9% of interstate and, in most cases, international end-user revenues. If, as expected, the FCC takes no action to modify the proposed contribution factor, it will become effective and apply for the 1st quarter of 2012. This will be the first time in the history of the Universal Service Fund that the contribution factor has exceeded 17%.
Because the contribution factor is greater than 12%, the FCC has noted the potential for some USF contributors who would not normally qualify for the limited international revenues exception (“LIRE”) (normally applicable to contributors for whom interstate revenues make up 12% or less of combined interstate and international revenues) to have a USF contribution amount in excess of total interstate revenues. Contributors facing these circumstances may petition the FCC for a waiver of the usual LIRE threshold of 12%.
The FCC’s Public Notice reminds carriers that marking up federal universal service line-item amounts above the 17.9% contribution factor is unlawful.
For further information regarding the contribution factor change, please see the FCC Public Notice at the following link: http://fcc.us/tCAdju.
