Congressional USF Group Seeks Input as USAC Proposes 39.3% Contribution Factor for Q4 2025

Congressional USF Working Group Seeks Input and Comments—its importance is heightened as USAC Recommends Setting the 4Q:2025 Contribution Factor at 39.3%

The Congressional USF Working Group (Working Group) has reconvened for the 119th Congress and is seeking comprehensive stakeholder input on Universal Service Fund reforms, with comments due September 15, 2025. The bipartisan and bicameral Working Group is led by Senator Deb Fischer (R-NE), who replaced Senator John Thune after he became Senate Majority Leader, and Senator Ben Ray Luján (D-NM). Representatives Richard Hudson (R-NC) and Doris Matsui (D-CA) lead House efforts, with additional members including Senators Shelley Moore Capito (R-WV), Amy Klobuchar (D-MN), Jerry Moran (R-KS), Gary Peters (D-MI), Dan Sullivan (R-AK), and Jackie Rosen (D-NV).

Congressional Working Group Launches Comprehensive Review

The Working Group includes the major congressional players on telecommunications policy in both the House and Senate. As such, any comprehensive USF reform legislation will likely originate from these sessions. The Working Group is soliciting comprehensive input from stakeholders across three main areas:

• Program Effectiveness: How Congress should evaluate each USF program’s success in achieving universal service missions and whether the FCC has adequately assessed programs against consistent performance metrics.
• Reform Recommendations: Ways to improve transparency, accountability, cost-effectiveness, and administration across all four USF programs while addressing waste, fraud, and abuse concerns.
• Structural Questions: Whether USAC requires reform and how to improve coordination between USF programs and other federal broadband initiatives.

Record Contribution Factor Underscores Need for Reform

The urgency behind the Working Group’s reform questions becomes clear when examining the latest USF projections. The Universal Service Administrative Company (USAC) has projected the contribution factor will increase to 39.3% in Q4, up from 36% in Q3, marking what would be the highest contribution factor in USF history. This escalating cost directly relates to the Working Group’s key question about ensuring “the USF contribution factor is sufficient to preserve universal service” while addressing cost-effectiveness concerns. JSI anticipates that rates will continue reaching record highs without legislative intervention, creating mounting pressure for the comprehensive federal USF reforms.

Comment Opportunity and Next Steps

This comprehensive review represents a rare opportunity to share valuable insights and help shape the future structure of USF programs that many providers depend upon. The Working Group’s focus on coordination between USF programs and other federal broadband initiatives is particularly relevant as many providers are required to navigate multiple funding streams and compliance requirements. Their examination of program effectiveness and structural reforms could significantly impact how providers access and utilize USF support in the future.

JSI has available general responses to the Working Group’s questions that clients can submit, with possible supporting data, to emphasize and support the need for reform. At minimum, JSI suggests clients reach out for a copy of these draft responses to submit to the Working Group. For clients seeking more tailored advocacy, JSI can work with you to develop personalized comments that reflect your specific operational experience and reform priorities.

This comment period provides a critical opportunity to share your company’s experience with USF programs and advocate for common sense reforms that would benefit all providers and the communities they serve. Given the comprehensive nature of this review and the rare bipartisan consensus on the need for USF modernization, participation in this process is essential for ensuring all perspectives are represented in future legislative discussions.

For copies of JSI’s draft responses or assistance in developing personalized comments, please contact Brett Hallagan, Douglas Meredith, or John Kuykendall.

Comments are due September 15, 2025.