AUSTIN (KXAN) — The Texas Public Utility Commission voted to increase the Texas Universal Service Fund surcharge from 3.3% to 24% this week. It will allow service providers to continue serving rural Texans who don’t have access to regular cell phone service.
The vote comes after a satellite phone service provider serving nearly 3,200 Texans sent a letter to its customers warning it would no longer be able to offer its services due to a lack of financial resources from that fund.
It also comes after the Third Court of Appeals ruled in favor of providers.
Dialtone Services, which spans 45 counties in Texas, provides a lifeline to rural Texans, many of whom do not have access to cell service. One of those customers is Harold Vestal, a landowner in west Texas.
“I have to drive, just to get a cell phone signal where I can actually talk to my cell phone, it’s about two and a half hours,” Vestal explained.
Just a few years ago, he depended on it to call the county sheriff when his two grandchildren went missing on his property.
“When you’re lost in the desert, it’s not days for you to survive, it can be hours,” Vestal said. The sheriff’s office was able to locate the kids, 28 miles away from his cabin.
The Texas Universal Service Fund was established in 1987 to ensure all Texans had access to basic, affordable telecommunications services.
“We figured out that the big phone companies didn’t have the resources and the small communities didn’t have the resources to be able to pay for those connections that were expensive to run a 10 mile line. And sometimes, that’s the only person on that line, that doesn’t make a lot of business sense,” Mark Seale with the Texas Telephone Association explained.
The fund supplements phone companies in rural areas to make sure that rural customers paid the same amount for commensurate services as urban customers.
“The federal government caps the amount that a rural customer can pay at around $30. So if you have areas of the state, which we do that cost $600 per line per month just to operate, you have to make up that difference. And so the state decided that it was important to make up the difference. And they created a system by which every phone customer in the state that makes an in-state long-distance call pays a little bit of money into the Universal Service Fund,” Seale said.
Phone companies were hoping the state would raise the current rate of 3.3% in 2018. But, it didn’t. Now, the company said the increase in funding will help “rural Texans who are dependent on satellite phone service for vital emergency services.”