This week the fifth circuit court ruled that the FCC cannot use the Universal Service Fund to pay for FCC programs that help offer cheap internet to low-income families.
At issue here is whether the Universal Service Fund allows the FCC to use the money for internet.
Many have argued that when the fund was created it was meant to be used for phone service. Now the FCC has changed it to use it for the internet. Many argue that people shouldn’t have to pay for this fee on their phone plans because the FCC is now using it for internet—not phone service.
According to the court’s ruling this week, “In the Telecommunications Act of 1996, Congress delegated its taxing power to the Federal Communications Commission. FCC then subdelegated the taxing power to a private corporation. That private corporation, in turn, relied on for-profit telecommunications companies to determine how much American citizens would be forced to pay for the ‘universal service’ tax that appears on cell phone bills across the Nation. We hold this misbegotten tax violates Article I, § 1 of the Constitution.”
This ruling likely means that this case will be headed to the Supreme Court for a final ruling. As that happens, likely no changes will be made to your phone bill or the FCC discounted plans until a final ruling is decided, which could take a long time.