FCC freezes rural phone rates for two years

The Federal Communications Commission voted on Tuesday to freeze rural phone rates for two years, Kery Murakami reports for Community Newspaper Holdings Inc. "The 2-1 vote provided relief from the rule mandating companies charge the national average phone rate, which goes from $18 to $20 in July and then to $22 the following year."

FCC said it will consider at a later date permanently changing or revoking the six-year-old rule that has been widely criticized for raising phone rates to more than one million rural customers, Murakami writes. FCC's decision may have come too late to stop all rural phone bills from increasing this year. At least one company, the non-profit People’s Rural Telephone Cooperative in McKee, Ky., said it had already scheduled a rate hike of $21 to cover an additional service area.

FCC Chairman Adjit Pai, a Republican, said the rural mandatory minimum rule was unfair "when compared with the average rate in some high-income urban areas like Washington, D. C.’s $13 monthly fee," Murakami writes. Republican Mike O’Rielly "said he agreed with the reason that led to the rule—urban phone customers subsidizing rural customers—but voted for the freeze anyway." Democrat Mignon Clyburn "said phone urban customers include “those who can least afford” to subsidize rural customers. She wanted the FCC to also approve policies cracking down on waste, fraud and abuse in the subsidies in order to lower rates."