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Separate Statement
Commissioner Susan Ness

Re: Report in Response to Senate Bill 1768 and Conference Report on H.R. 3579

I welcome today's opportunity for the Commission to respond to concerns that have been expressed by Congress. We have no greater responsibility, or challenge, than to implement successfully the Telecommunications Act of 1996. An active and continuing dialogue between the FCC and Congress is important to keeping implementation on track. We do our best to follow the statute as Congress wrote it, but, to the extent that we receive additional congressional guidance on ways in which our implementation decisions can be improved, I am happy to be responsive.

In particular, there have been significant congressional concerns about the administrative structures that were established to administer various universal service support mechanisms. Although I firmly believe that the structures previously established were suited to the goals of efficiency and accountability, and consistent with our statutory authority, it is clear that Congress believes the job can be done better if, at a minimum, the Schools and Library Corporation and the Rural Health Care Corporation are combined in a single entity. I believe we should follow this guidance and that the best way to do so probably is to fold both SLC and RHCC into the Universal Service Administrative Corporation.

A final decision, of course, should await the development of a specific proposal, the opportunity for deliberations by the Commission and the state members of the Federal-State Joint Board on universal service, and confirmation from Congress that the revised structure will meet with approval. It is my sincere hope that this approach will not only receive congressional support but also meet the needs of the intended beneficiaries of the universal service provisions of the Telecommunications Act.

Similarly, if Congress has concerns about the salaries paid to the senior employees of SLC, RHCC, USAC, or NECA, then it is our responsibility to take responsive action. Funds used for administration of the high-cost, low-income, or school, library, and rural health support mechanisms necessarily diminish, to some degree, the funds that will be available for the beneficiaries of the programs. Although these corporations require capable administrators, and the boards of directors of each of these associations have made independent decisions about the salaries they pay their executives, the unambiguous wishes of Congress must be respected -- and followed.

This report also provides valuable information about the manner in which universal service support is being collected. The key point this report demonstrates is that universal service funding for schools, libraries, and rural health care is being collected without necessitating increases in the costs of services to telecommunications consumers. Access charge reductions, in particular, coupled with growth in the industry, declining costs, increased competition, and the elimination of deadweight losses, enable the new universal service support mechanisms to be initiated -- and the low-income and high-cost programs to be maintained -- while aggregate prices to consumers continue to decline. There is, to be sure, a growing amount of confusion about various line-items that are appearing on consumers' bills, and I believe we should be forceful in acting to ensure that these charges are not misleading or inappropriate. But the line on the bill that matters most is the bottom line, and that's the line we are working hardest to reduce.

I want to work with Congress to ensure that the Telecommunications Act is a resounding success. I strongly believe that Congress acted wisely in deciding to expand the traditional notion of universal service by supporting the connection of classrooms and libraries to the information superhighway. I will continue to work to ensure that this vision -- which is so crucial to our success as a nation in the 21st century -- is successfully implemented, with congressional guidance and support.