Cell phone bills would likely increase under a measure that passed the South Carolina House of Representatives on Wednesday.
The legislation deals with the state’s Universal Service fee (USF), which landline phone customers must pay as a percentage of their bills each month. The revenue goes towards providers to improve telecommunications access in South Carolina, such as installing phone lines in rural counties. It eventually passed overwhelmingly 103-2, but only after a lengthy debate.
A state Public Service Commission order earlier this year expanded that fee to include cell phone customers for the first time. Communications providers pushed for the move, as fewer landline customers put further strain on the fund and pushed the fee steadily higher. The state’s USF is around 2.6 percent.
Now supporters hope expanding the fee to wireless phones will mean more money and lower costs for landline customers. “It’s actually reduced (under this plan), because it’s spread over a larger customer base,” State Rep. Bill Sandifer, R-Seneca, said during Wednesday’s debate. The state Office of Regulatory Staff has previously said the additional customers will allow the rate to drop to 1.3 percent.
But some opponents questioned why wireless customers were paying for landline services at all. “It’s an anachronistic system that we should be getting rid of, anyway,” State Rep. Jim Merrill, R-Charleston, said. “Instead of us deciding to do that, we’re loading up and putting it on the backs of people who decided to buy wireless phones.”
Merrill accused House leaders of punting to the unelected Public Service Commission for a tax increase that House members rejected outright last year.
But Sandifer said wireless companies rely on landline infrastructure and the commission’s decision will still take effect regardless of the House’s actions. He said the new legislation caps the USF’s size at $42 million (after years of being above $100 million) and would require regular audits to ensure the fund is being used efficiently.
“This makes it fair for everybody,” he said. “Everybody benefits, everybody pays in.”
Merrill insisted the fund is only shrinking because the state’s largest provider AT&T had pulled out of it. He also argued the audits should be done beforehand, not the fee is expanded. However, the Charleston Republican gradually lost support as the debate continued. Three dozen lawmakers initially signaled their opposition to the bill in early votes, but that dropped to just Merrill and State Rep. Bill Chumley, R-Woodruff, by the final tally.
The measure heads back to the Senate after another procedural vote Thursday. Senators passed a similar version earlier this year.