As the U.S. Supreme Court considers the constitutionality of how the federal program called the Universal Service Fund uses more than $8 billion in fees imposed on the phone bills we pay, tens of millions of dollars in such fees weigh in the balance in Oklahoma.
The fees are meant to subsidize the cost of telecom services for poor people, rural residents, schools, hospitals and libraries. The services are often provided by small telephone and communications companies across Oklahoma.
How much money are we talking about in the state? Approved payments, according to the Oklahoma Corporation Commission, totaled $2,815,824 in January of 2025. But the total disbursements in the same month were $7,077,621.64. The disbursements made in November 2024 were $15,803,858.
As explained by the Corporation Commission, the commissioners are limited to approving the methodology to which the assessment factor is used and the amount of the assessment factor, itself, that is charged in accordance with that methodology which is currently per connection. The OUSF is handled by a 3rd party administrator and the fund generated by the assessment factor are not considered state funds. The Director of the Public Utility Division currently serves as the Administrator of the OUSF and reviews/approves all requests for reimbursement from the fund. This is not a function of the Commissioners.
The Commission further explained the OUSF operates off a fiscal year that runs from July 1 to June 30. Unlike the state fiscal year, which is currently FY25, the OUSF fiscal uses the year in which the fiscal year begins rather the year in which the fiscal year ends. The current fiscal year for OUSF is FY24 which began 7/1/2024.
The FY24 funding figure obtained last week was $109,091,961.
Arguments were heard by the Supreme court that Congress had unconstitutionally handed off its taxing power to the Federal Communications Commission without sufficient limits. Bloomberg News indicate the challenge wound up before the Supreme Court after the conservative advocacy organization Consumers’ Research won a federal appeals court decision that declared the fee unconstitutional.
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