I’d lost track of the E-Rate program, created in Congress a few years back to help fund schools and libraries for telecommunications and Internet access services. Marguerite Reardon has written a great article filling in the gaps over on CNET’s News.com.
The numbers involved are pretty staggering. In a relatively painless fashion, this program raises about a dollar per month per consumer telephone subscriber — over $100 million EACH MONTH! 1% of the funds raised cover the management of the program ($25 million a year) through an entity called the Universal Service Administrative Company.
Unfortunately, this kind of big money also draws flies — and fraud — which is the main focus of Reardon’s article. Seems like one of the larger policy issues looming — besides cracking down on fraud — is the impact VoIP telephony could have on these kinds of taxes. With the magnitude of the dole involved here, I’m sure those affected are swarming Capital Hill to protect their flanks.