Introduced with bi-partisan support, HB 4079, a bill to address funding gaps for the Oregon Universal Service Fund (OUSF) and make investments broadband infrastructure across the state passed out of the House committee on revenue, Monday.
The current bill seeks to expand the surcharge currently billed to landlines, to cell phone providers, retail commercial mobile radio services, and voice over internet protocol (VOIP) to create an equitable and broad surcharge base reflective current telecommunications usage and users. New to the market, cell phones were not included in the surcharge at the creation of the program. While today, cell phone providers lead the market, and use landline networks to complete calls and text messages, they are still exempt from the surcharge.
In addition to the continued need for support with telecommunications services, there also exists a growing need for broadband services across the state. The bill would create a fund capped at $5 million dedicated to broadband, managed by Business Oregon. The fund would be dedicated to assist communities in developing broadband networks that would reach across the state to serve all Oregonians.
Created by the Legislature in 1999, the OUSF was designed to support and provide targeted investments for telecommunications service in rural areas of the state. In its first operational year (2000), the surcharge brought in $12.6 million in revenue from landlines. The tax rate on landlines was 2.35 percent in the initial year, and because the use of landlines steadily declined while wireless technology use surged, the surcharge continued to increase and hit its statutory 8.5 percent cap. By 2017, the overall revenue plummeted to less than 60 percent of what was brought in the first year.
In 2019, in order to bridge the devastating gap in funding, Representative Pam Marsh (D-Ashland), member of the Oregon Broadband Advisory Committee introduced a similar bill HB 2184. The bill made it through the House, and died in the Senate on the final day of the Session as the clock ran out on a backlog of bills awaiting their final vote.
Association of Oregon Counties (AOC) supported the 2019 and 2020 measures. To view coalition letter AOC signed with a number of advocacy groups, click here.
The bill now sits in the joint committee on ways and means awaiting further consideration.
Contributed by: Megan Chuinard | Public Affairs Associate