On March 14, 2023, the Office of Managing Director (“OMD”) released a Public Notice announcing that the proposed universal service contribution factor for the second quarter of 2023 will be 0.290 or 29.0%. Per FCC rules, during the second quarter of 2023, carriers may not recover through a federal universal service line item an amount that exceeds 29.0% of the interstate telecommunications charges on a customer’s bill. The contribution factor for the first quarter of 2023 was 0.326 or 32.6%.
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 second quarter of 2023 total $1.95190 billion. The projected industry revenues for the second quarter of 2023 are $8.761743 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 $6.741745 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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