The Federal Communications Commission (FCC or Commission) has adopted an Order waiving the application of the budget control mechanism, which applies to rate-of-return carriers receiving high-cost universal service support from legacy mechanisms, for the 2022-23 tariff year. The FCC recognized that the waiver will put increased pressure on the Universal Service Fund, but found it to be in the public interest because of: (1) substantial growth in projected support due to pandemic-related increases in broadband-only lines and population migration to areas needing high-cost support; (2) the budget control inflation factor is backward-looking nature of the budget control inflation factor, which does not reflect current conditions; (3) unique and continued cash flow and other economic challenges carriers face as a result of the pandemic; and (4) the importance of providing broadband services during this unprecedented time.
