April 21, 2004

The Honorable Daniel K. Akaka
United States Senate
141 Hart Senate Office Building
Washington, DC 20510

Dear Senator Akaka:

The FCC is currently considering dramatic and ill-conceived changes to the Universal Service Fund that will unfairly shift costs to low income, low volume, and rural consumers and undermine the fundamental principles of universal access to utility services that have served as a foundation for our modern economy.

Gray Panthers is urging you to oppose efforts to shift funding for universal service from the current revenue-based system to a connection-based one with flat rate for each user. This type of proposed funding methodology is discriminatory and is neither "equitable" or "competitively neutral." In practice it would mean that individual residential consumers would pay the same fee as businesses, and seniors and other fixed- and low-income, low volume callers will pay the same fees as high volume callers.

The connection-based system will impact wireless as well as wireline customers on fixed incomes. The adoption of a connection-based system will have a negative impact on the 44% of consumers identified as low volume users who rely on wireless service primarily for safety, security and peace of mind. 10 million prepaid wireless service customers would see rate increases, while others will be priced out of the market. They may not call as often as high-volume users, but every call is important.

Telecommunications provide crucial social links for generations. This proposed change could cut those links by severing the lifelines of seniors who are disproportionately low- and fixed-income people.

The universal service fund was created to ensure that all communities including rural or higher-cost areas have access to communications service at "reasonable" prices. It is now one of the primary reasons that schools, libraries, health centers, and other educational facilities have access to the advances of our digital age.

Electronic communications and the Internet will be even more central to economic life and civic activity in the future than they have been in the past. We urge you to oppose efforts to weaken universal service funding by switching to a connections based model and to support our efforts to strengthen our nation's commitment to universal service.

Sincerely

Will Thomas
Gray Panthers