FEDERAL COMMUNICATIONS COMMISSION
April 9, 2012
,JULIUS GENACHOWSKI
CHAIRMAN
The Honorable Cliff Steams
Chairman
Subcommittee on Oversight and Investigations
COl11l11ittee on Energy and Commerce
U.S. House ofRepresentatives
2125 Rayburn House Office Building
Washington, D.C. 20515
Dear Chairman Stearns:
Thank you very much for your support for the COl11l11ission's proceeding to reform the
Universal Service Fund (USF), and your letter encouraging reform ofUSF contributions. I will
ensure that your letter is included in the record.
As you point out, reform ofthe USF contribution system will build on the smart
government reforms ofUniversal Service that the Commission has achieved over the last several
months. Because the USF contribution burden is determined by the total amount ofUniversal
Service funding given out each year, scrutinizing every USF program for waste and inefficiency
was the first step to protect businesses and consumers from undue growth in the USF
contributions. In October, the COlrullission unanimously and comprehensively reformed the USF
high-cost program: We set an express progranl goal ofminimizing the USF contribution burden,
eliminated substantial waste and inefficiency, and put the program on a budget. In January, the
Commission also adopted bipartisan reforms to another key part of USF-the Lifeline
program-to eliminate waste and abuse. We put Lifeline on track to save up to $2 billion in the
next three years, keeping money in the pockets ofAmerican consumers that otherwise would
have been wasted on duplicative benefits, subsidies for ineligible recipients, or fraudulent misuse
of Lifeline funds.
By taking these steps, the Commission constrained the overall contribution burden on
consumers and businesses, while expanding access to broadband for millions more Americans.
As you note, addressing the contribution system is the next step. Building on our reform efforts
to date, the Commission currently is considering reforms to the rules under which USF
contributions are assessed, to ensure the system is predictable, fair, and stable.
I appreciate your interest in this very important matter. Please let me know if! can be of
any further assistance.
V//;~iUSGenachowski
445 121>< 5TREET S.W. WASHINGTON, D.C. 20554 • 202-418-1000