California to Extend State Universal Service Contribution Obligations to Fixed and Nomadic Interconnected VoIP Providers


As predicted, efforts are well underway at state public utility commissions to extend state universal service fund contribution obligations to nomadic interconnected VoIP providers.  Leading the charge is the California Public Utilities Commission, which on January 13, 2011 released an Order initiating a rulemaking concluding that all interconnected VoIP providers, including nomadic VoIP providers, are required to contribute to California’s state universal service programs.  These programs include the California LifeLine Telephone Program, the California High-Cost Fund A, the California High-Cost Fund B, the California Advanced Services Fund, the California Teleconnect Fund, and the California Deaf and Disabled Telecommunications Program.

The Order seeks comment on a limited range of issues, including the CPUC’s tentative conclusion to require all interconnected VoIP providers to register with the CPUC, and on the proposed contribution methodology for interconnected VoIP providers.  While the CPUC’s proposed contribution methodology is consistent with the federal universal service methodology, the CPUC failed to outline a specific contribution approach that will avoid duplicative assessment by different states on the same nomadic VoIP provider revenues.  It is likely that duplicative assessment will be addressed by parties in comments and reply comments to the proceeding.  We firmly expect other states to follow the FCC and California’s lead and initiate rulemaking proceedings to extend their state universal service programs to nomadic interconnected VoIP providers.

Clients with comments or questions regarding this Advisory should contact the attorney responsible for their account.

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