Opening Statement of Rep. Jerry Weller (R-IL).
Ways and Means Oversight Subcommittee Hearing on E-Rate.
Date: August 4, 1998.
Source: Ways and Means Committee.  This document was created by TLJ by scanning a paper copy, and then converting it to HTML.

Statement of Representative Jerry Weller
for
Ways and Means Oversight Subcommittee Hearing
on
The Funding Mechanisms for the "E-Rate" Program
August 4, 1998

Thank you, Madam Chairwoman

I am glad to join my colleague, Mr. Tauzin to testify before the Oversight Subcommittee on what began as an effort to achieve a goal we all share ... giving every child access to the Internet through our local schools and libraries.

When we passed the Telecommunications Act of 1996, it included a simple directive that any telecommunications carrier serving a particular geographic area must make any of its services under the Universal Service Fund (USF) available at reduced rates to schools and libraries. Unfortunately, the FCC misinterpreted the Telecommunications Act and now jeopardizes the goal we all share, which is providing Internet access for all of America's children.

First, the FCC determined that as much as $2.25 billion per year should be made available to support universal service for schools and libraries. Second, FCC expanded the scope of what was available for schools and libraries from just discounted rates on the telecommunications services and decided to include Internet access costs and internal connections (wiring).

Third, the FCC created a whole new bureaucracy, known as the School and Library Corporation to administer the e-rate program without any authorization from Congress to do so. Finally, with probably the most questionable of all of the provisions, the FCC determined that the funds supporting the e-rate, for schools and libraries should come from an assessment, or tax,, on all long distance telecommunications service providers. This controversial assessment, which is currently facing legal challenge, is now known as the "Gore Tax".

Here are the problems that we now face: 1) The FCC has taken unauthorized action to create a new ineffective bureaucracy that has yet to provide any funding to 1800 schools in Illinois that have applied for help in connecting their students to the Internet and 2) The FCC has taken the unconstitutional action of imposing an unauthorized tax on long distance users in order to cover the expense of this unworkable enterprise.

The FCC is incorrect in its contention that the Gore Tax is a fee. A fee is a charge for a service rendered; however, long distance users are not receiving a service. Thus, if a charge is levied and no direct service is provided then it is characterized as a tax, regardless of whether it shows up on your 1040 form or your telephone bill, and only Congress can impose a tax under the Constitution. The FCC's actions are now being contested in court.

The result is that many schools across the country that were depending on the E-Rate have been left in the cold. Some examples in the 11th District of Illinois which I represent,

Bradley-Bourbonais Community High School applied to get 38 computers connected;

Steger School District. 194 applied to get 156 classrooms wired;

Wilmington School District. 209 applied to get 123 computers connected and 50 classrooms wired.

Joliet Public Library applied to get 20 computers connected;

La Salle Catholic School applied to get 36 Computers connected and 14 classrooms wired.

This is only a smattering of examples of where the FCC and the SLC have left the hopes and dreams of schools and students hanging in the winds. We cannot let this continue. That is why I am glad to join Mr. Tauzin in sponsoring the Schools and Libraries Internet Access Act of 1998 (H.R. 4324).

The Schools and Library Internet Access Act would save the technology assistance program for over 1,800 schools in Illinois alone by slashing the World War I three percent telephone excise tax (currently sent to the general fund) to I% and earmarking the remaining revenue to fund the important school and library Internet access programs through block grants to the states. In addition to slashing the current tax, The Schools and Library Internet Access Act repeals the 3% Gore Tax on long distance customers. Our legislation will save consumers $5 billion while providing $1.7 billion in the first year to equip our nation's schools and libraries with Internet access.

The legislation effectively kills two birds with one stone. First, the legislation preserves and expands funding for the important Internet access assistance program to our schools and libraries and places it appropriately under the jurisdiction of the National Telecommunications and Information Administration. Second,, the legislation abolishes the FCC's unconstitutional "Gore tax" funding mechanism and reduces an antiquated World War I tax which disproportionately impacts the poor and senior citizens.

Let's do it right this time. The FCC and its illegal "Gore tax" created the problem. However, I support the bipartisan goal of giving every child in school access to the Internet and believe we need to solve this problem by enacting The Schools and Library Internet Access Act. It is important to the Illinois school children and the 1800 schools which are pleading for help. It is the right thing to do. Lets work in a bipartisan fashion to get it done.

Therefore I ask my colleagues to give the Schools and Libraries Internet Access Act favorable consideration in this committee.

Thank you, Madam Chairwoman.