Universal Service Fund (USF)
WHAT IS THE UNIVERSAL SERVICE FUND (USF)?
The USF is a government administered fund to support the provision of telecommunications services in rural and high cost areas, to low income consumers and to schools, libraries and healthcare facilities nationwide. All telecommunications providers contribute to the USF on an equal percentage. The contribution factor changes quarterly and represents a percentage of end user revenues.
WHO IS USAC?
USAC is the Universal Service Administrative Company. It is an entity created by the Federal Communications Commission (FCC) to administer the federal Universal Service Fund. USAC is responsible for collecting contributions owed by contributors and for making support payments to entities eligible for reimbursement from the Fund.
HOW MUCH IS THE USF FEE IMPOSED BY USAC?
The USF fee is set by the FCC quarterly and collected by USAC. The fee is a percentage of end users’ interstate and international telecommunications revenues.
WHAT GOVERNMENTAL AGENCY IS RESPONSIBLE FOR USF?
Congress authorized the FCC to implement the Universal Service Fund. The USF is mandated by Section 254 of the Communications Act.
WHAT STATES AND COUNTRIES ARE IMPACTED BY USF?
The USF applies to services billed to U.S. customers, including both INTERSTATE AND INTERNATIONAL SERVICES. If the call both originates and terminates outside the U.S., USF fees will not apply. USF fees apply to interstate telecommunications and U.S.-billed calls between the U.S. and foreign countries. Calls initiated from overseas that are bridged in the U.S. will be subject to USF. If the conference involves someone starting a call in one state and terminating in another state or calls between a foreign country and the U.S., the USF fee will apply, regardless of where the company is headquartered.
WHY IS SPEAKSPACE COLLECTING THIS FEE ON AUDIO CALLS?
Due to a decision made by the FCC, SpeakSpace and ALL CONFERENCING PROVIDERS are required to file quarterly forms with USAC that show all telecommunications sold and remit the fee assessed by the FCC. SpeakSpace is carrying out the order of the FCC. IT IS NOT A CHOICE.
ARE SPEAKSPACE COMPETITORS ALSO REQUIRED TO PAY INTO THE USF?
The FCC’s order makes it clear that all providers of conferencing must comply with the order. The FCC has directed USAC to ensure that our competitors abide by this order.
WHEN WILL THE FEE BE COLLECTED?
The FCC’s order of June 30, 2008, requires USAC to collect the USF fee from SpeakSpace beginning on October 1, 2008. The USF charge first appeared on your invoices for conferences made on or after October 1, 2008.
WHAT WILL I SEE ON OUR INVOICE?
USF allocation is displayed on your paper invoice per FCC regulations. A description may also be printed on the invoice defining what the fee is and where more information can be found.”
WILL SPEAKSPACE CHARGE THE USF TO AUDIO CONFERENCE CALLS INITIATED IN OTHER COUNTRIES?
If the call both originates and terminates outside the United States, USF fees do not apply.
IS USF BASED ON WHERE THE COMPANY IS HEADQUARTERED?
No. Federal USF fees apply to interstate telecommunications and calls between the United States and foreign countries. The FCC’s order determined that conferencing is telecommunications. Therefore, if the conference involves a call from one state terminating in another state or calls between a foreign country and the United States, the USF fee will apply.
DOES IT MATTER WHERE THE LEADER OR PARTICIPANTS ARE LOCATED?
It does matter where the leader or participants are located. USF is applied based upon the location from where the participant is dialing from and where the bridge is located (originate/terminate). Below are important terms to remember:
- Terminate: From a transport perspective, the piece of equipment the call actually terminates in (our bridge supporting the call).
- Originate: If our bridge initiates the dial-out, the origination is the bridge location. Otherwise, the origination is the number from which the participant is dialing.
- Intra-state: The call originates and terminates in the same state.
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- Leg-Level vs. Entire Call: USF is applied at the leg-level and is applied to all appropriate legs of the call.
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- NOTE: It is possible to have intrastate, international and interstate participants on the same conference call.
IF I USE SPEAKSPACE’S WEB CONFERENCING SERVICES AND BEGIN THE AUDIO PORTION OF THE CALL FROM THE WEB USING AUDIO INTEGRATION, WILL USF NOW BE APPLIED TO THIS CONFERENCE?
Yes. USF applies to all interstate telecommunications. The FCC’s June 30, 2008, order provides that the combination of the audio bridging with other features does not shield the conference from the USF fee. However, the cost of the web service itself will not be subject to the USF fee.
WHAT IF I START A CALL FROM MY CELL PHONE?
USF applies to all interstate telecommunications regardless of the device used. The FCC’s June 30, 2008, order provides that the combination of the audio bridging with other features does not shield the conference from the USF fee.
WILL SPEAKSPACE ISSUE A CREDIT FOR THE USF IF A CREDIT WAS ISSUED ON A CALL?
Yes. When a credit is issued, the applicable fees, surcharges and taxes assessed on the portion subject to the credit also are credited.
ARE CHARITABLE OR RELIGIOUS ORGANIZATIONS EXEMPT FROM THE USF FEE SIMILAR TO THE EXEMPTION FROM CERTAIN SALES TAX?
This is not a tax. USF fees apply to all end users, including all of the above organizations.
DOES THIS FEE APPLY TO FEDERAL, STATE AND LOCAL GOVERNMENTS?
Yes. Since USF is not a tax, there is no way to exempt you on this basis. However, you can request exemptions if you can prove you are directly paying USF.
KEY FACTS TO REMEMBER:
This is a regulatory fee and ALL audio conferencing providers are paying into this fund.
100% of the fees collected for USF go to the government.
SpeakSpace does NOT PROFIT from this fee.
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