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News Release
Commission Reduces Universal Service Fund Rate
August 10, 2001 (2001 - 029)(UM 731)
Contacts:  Roy Hemmingway, Chairman, 503 378-6611; Roger Hamilton, Commissioner, 503 378-6611; Joan H. Smith, Commissioner, 503 378-6611; Bob Valdez, Public Information Officer, 503 378-8962
Salem, OR – The Oregon Public Utility Commission has agreed to reduce the Universal Service Fund surcharge from 3.24 percent to 3 percent on telecommunications services, effective October 1, 2001, based on a semiannual review of projected telecommunications revenues.
For example, a customer with a monthly phone bill of $50 who pays a $1.62 a month surcharge will see it drop to a $1.50, and for a $100 the surcharge will fall from $3.24 cents to $3.00.
"We began to collect more money than allowed for the reserve fund so we decided to reduce the rate now. The Commission will continue to keep the rate at the minimum," said Commissioner Joan Smith.
The 1999 legislature, through Senate Bill 622, directed the Commission to begin collecting the surcharge September, 2000, in order to finance a Universal Service Fund to help pay for affordable basic telephone service in rural Oregon.
The surcharge is expected to generate $48 million a year.
In areas where it costs more than $21 dollars per phone line to provide service, telephone companies or eligible competitors would receive money from the Universal Service Fund.
The surcharge does not allow phone companies to increase their profits. In April of this year the Commission approved new tariffs for Qwest and Verizon to reduce some business service rates and common carrier charges in order to completely offset monies received from the Universal Service Fund.
Wireless phone bills and charges for Internet services are exempt from the surcharge.
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