In a victory for electric cooperatives and rural communities, the Supreme Court upheld a vital Federal Communications Commission-managed fund that supports rural broadband deployment and other communications services nationwide.
On June 27, the court ruled 6-3 to preserve the Universal Service Fund, rejecting a lower court’s argument that the USF’s funding mechanisms are unconstitutional. The USF is funded by contributions from telecommunications carriers nationwide to promote quality services, including broadband internet access, at just and affordable rates.
“Electric co-ops across the country are leading the charge to bring affordable, reliable broadband service to rural communities, and the USF plays a crucial role in supporting that mission,” NRECA CEO Jim Matheson said. The Supreme Court’s decision “is a win for rural America and preserves access to critical support for rural broadband providers and the communities they serve,” he added.
The FCC distributes Universal Service Fund proceeds to several programs that support broadband deployment, including the Connect America Fund, the Rural Digital Opportunity Fund and Lifeline.
Thirty-two electric co-ops won a combined $254.7 million in the Connect America Fund Phase II auction. Co-ops are using the money to bring high-speed internet service to 86,716 unserved locations in 15 states.
Electric co-ops, individually or as part of consortia, have also won about $1.6 billion from the Rural Digital Opportunity Fund to construct broadband networks and provide service to 910,539 unserved locations.
Many more electric cooperatives also participate in other portions of the Universal Service Fund, including the E-Rate program, which supports broadband connectivity to schools and libraries, and the Rural Health Care program, which improves broadband access for health care facilities.
NRECA joined several other organizations, including CoBank and National Rural Utilities Cooperative Finance Corp., in filing an amicus brief in the case before the Supreme Court.
The brief outlined how losing USF would hurt rural communications service providers and the communities they serve. The fund is also vital for the agriculture industry, manufacturing sector, telehealth and remote workers, the filing stated.
“This is a real victory for rural communities,” said Brian O’Hara, NRECA senior director of regulatory affairs. “These programs ensure rural communities across the country can improve digital access and do not fall behind on connectivity.”
Molly Christian is a staff writer for NRECA.