New Mexico Announces Change to State Rural Universal Service Fund Contribution Factor, Reinforcing Diverse and Dynamic Nature of USF Surcharges

New Mexico’s state universal service fund (“USF”) administrator — VantagePoint Solutions — recently announced a change to the New Mexico State Rural Universal Service Fund contribution factor.

For 2022, the contribution factor will decrease from $1.08 to $0.95 per connection. While seemingly insignificant, this change exemplifies the diverse and rapidly evolving USF regulatory landscape, discussed at length in our State PUCs Experimenting with Alternatives to Revenue-Based USF Funding Mechanism advisory.

New Mexico’s USF is an excellent example of the diverse ways in which states fund their universal service programs. Unlike the Federal Communications Commission and most states, which impose USF surcharges based on a percentage of contributing carriers’ qualifying revenues, New Mexico is one of a few jurisdictions that has transitioned to connections-based assessments.

Other states, such as California,  are currently considering such a shift while another group of jurisdictions is experimenting with surcharges based on the number of active telephone line counts, especially to fund their intrastate telecommunications relay services programs for deaf and hard of hearing consumers. However, Missouri has surprised everyone by suspending its USF assessment entirely and by recently extending the suspension for all contributing communications providers.

Clients should continue to monitor developments and consider the potential impact on their current and future state USF contribution obligations.

If you have general questions about your USF obligations, contact the attorney assigned to your account. If your company provides services to consumers in New Mexico and would like assistance with ensuring billing and collecting surcharges are in accordance with applicable laws and regulations (either directly through internal billing systems or in conjunction with a third-party tax engine, such as SureTax or Avalara), please contact Allison D. Rule at adr@commlawgroup.com or Jackie R. Neff at jrn@commlawgroup.com.

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