FCC hit over ‘rate floor’ increase

The Federal Communications Commission is coming under pressure for its attempt to raise the minimum amount that companies can charge for basic phone service and still get a government subsidy.

The commission’s “rate floor” is scheduled to go up from $14 to $20.46 this year, despite protest from members of both parties.

{mosads}Sen. Mark Pryor (D-Ark.) has previously protested the FCC action, and last week received a letter from FCC Chairman Tom Wheeler, who has pledged to phase in the increase.

“Rural Arkansans can’t afford steep phone rate hikes, and certainly not on such short notice,” said Pryor, who is facing a tough reelection fight, in a statement. “I appreciate the chairman for his willingness to listen to me, and I will continue to work with him and the other FCC Commissioners to ensure all Americans have access to fair and affordable phone rates.”

The rate floor requires that telecommunication companies charge a certain amount of money for monthly phone service in order to get subsidies from the FCC’s Universal Service Fund.

The mark is meant to ensure that urban and rural rates are “reasonably comparable,” so that some people are not subsidizing overly cheap service for others.

But Ajit Pai, a Republican FCC commissioner, noted that the new floor would be 45 percent higher than the local rate in Washington: $14.10.

“This issue is another example of why so many in our nation’s heartland feel so alienated from Washington, DC.,” Pai said in a statement on Monday.

“Too often, there is one set of rules for those inside the Beltway and another set of rules for everyone else. I hope the Commission will reconsider this ill-conceived policy and not raise rural Americans’ phone bills to no end.”