GTE congratulates lawmakers' reform of schools and libraries funding source.

Background: Sen. Conrad Burns (R., Mont.) and Rep. W.J. (Billy) Tauzin (R., La.) today announced the reintroduction of legislation to assist schools and libraries to receive discounted Internet connections and telecom services. Their legislation separates the schools and libraries program from the Universal Service Fund, which was established to ensure affordable telephone services for residents of rural and under-served areas. The legislation proposes to reduce the 3% federal excise tax on telephone calls to 1% and redirect the funds generated from the reduced tax to the schools and libraries program, through grants to the states. The program would be administered by the National Telecommunications and Information Administration.

The following may be attributable to Geoffrey C. Gould, vice-president of government and regulatory affairs and head of the Washington office of GTE Corp:

"GTE congratulates Sen. Burns and Rep. Tauzin for re-introducing legislation to solve the funding dilemmas associated with the 'schools and libraries program', or e-rate, that was created by the Telecommunications Act of 1996.

"As we have stated in the past, the objectives of this program--to enable America's schools and libraries to receive a discount on advanced telecommunication services--are very worthwhile. But while we support the program, we believe the FCC's implementation greatly exceeds what Congress intended and misdirects funds that are meant to help support affordable telephone service.

"The proposal by Senator Burns and Congressman Tauzin would adequately address the education needs that Congress envisioned with the e-rate and, by cutting the current excise tax, provide immediate savings for consumers and businesses.

"We urge Congress to move forward with this legislation and halt further funding the program with dollars that are intended to provide affordable telephone service to all Americans."