By Fritz Edelstein
December 13, 2004

During the last five minutes of Congress' lame duck session, the Senate passed H.R. 5914 by unanimous consent, which included an exemption for the E-rate part of the Universal Service Fund from requirements of the Anti-Deficiency Act. This bill provided a one-year exemption for the program from the requirements of the Anti-Deficiency Act. Congress had not found a way to solve the problem when recently passing the Omnibus Appropriations bill.

Mayors from across the country had a role in convincing members of the Senate to support the legislation. They made strategic phone calls and sent letters to key members of their delegations to convey the importance of this program to their schools and public libraries. The United States Conference of Mayors was part of a diverse coalition of groups that worked for six weeks to make the exemption a reality. The one-year exemption provides time to work on a long-term solution.

If there had been no resolution of this matter, the freeze on sending out funds would have continued on several of the programs included in the Universal Service Fund. Each program would have had to accumulate enough cash to send out commitment letters that are considered obligations to grantees by federal accounting standards. This could only be accomplished by the Federal Communications Commission raising fees on telecom bills to as high as 25 percent in the short term, and 13 percent in the long term as compared to the current 8.7 percent.

With the passage of H.R. 5914, the money and commitment letters will begin to flow to schools and public libraries in the next few weeks. It is anticipated that more than $400 million will be sent out before the end of the year.