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E-rate Regulators Testify Before Congress

On February 16, 2012, FCC Chairman Julius Genachowski and FCC Inspector General David Hunt testified at a House Appropriations Subcommittee hearing titled “The Budget and Spending of the Federal Communications Commission.” Acting CEO of the Universal Service Administrative Company Scott Barash also testified, explaining the role USAC plays in administering and providing oversight to the four Universal Support programs, including E-rate.

According to Chairman Genachowski, the FY 2013 FCC budget request reflects a 2% increase in spending from FY 2012, which would be considered flat when adjusted for the rate of inflation. In FY 2008 the Office of the Inspector General (OIG) was authorized to transfer $21.48 million out of the Universal Service Fund in order to strengthen their investigative and oversight abilities. The OIG hired 19 employees, which included 10 auditors, 6 investigative attorneys, 1 resource manager and 1 information technology specialist. The OIG testified they have $11.3 million remaining, but would like an additional $2.6 million directly from the FCC’s Chairman’s budget to hire 19 full term employees as opposed to continuing to use temporary workers, as it is difficult for the OIG to create a long range strategic plan without having the certainty of the full term employees.

The OIG and Mr. Barash both testified about the improvements in internal controls, audit processes, investigative techniques and overall administrative processes Universal Service has undertaken in the last several years. The OIG also highlighted several recent criminal E-rate activities they have investigated in over the last year.

The FCC’s FY 2012 budget expires on September, 30 2012.

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