FCC Announces Proposed Q4 2022 USF Contribution Factor

On September 13, 2022, the Office of Managing Director (“OMD”) released a Public Notice announcing that the proposed universal service contribution factor for the fourth quarter of 2022 will be 0.289 or 28.9%.  Per FCC rules, during the fourth quarter of 2022, carriers may not recover through a federal universal service line item an amount that exceeds 28.9% of the interstate telecommunications charges on a customer’s bill.  The contribution factor for the third quarter of 2022 was 0.330 or 33.0%.

As a reminder, the FCC calculates the quarterly contribution factor based on the ratio of total projected quarterly costs of the universal service support mechanisms to contributors’ total projected end-user interstate and international telecommunications revenues, net of projected contributions.  The projected demand and administrative expenses for the fourth quarter of 2022 total $1.91403 billion.  The projected industry revenues for the fourth quarter of 2022 are $8.624083 billion.  The adjusted contribution base (the projected industry revenues decreased by the projected revenue requirement to account for circularity and decreased by one percent to account for uncollectible contributions) is $6.642952 billion.

The contribution factor will be deemed approved 14 days following the release of the Public Notice, unless the Commission takes any action regarding the projections for demand and administrative expenses and/or the proposed contribution factor.

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