Proposed cellphone fee passes Senate on tight vote

Cellphone users would be charged a 1.1 percent fee under a measure approved by the Senate on Thursday. The money would go into a fund that helps pay for landlines in rural areas.

COLUMBIA — A proposed fee on cellphone bills to help pay for rural landlines won approval Thursday from the Senate, passing on a tight vote over opposition by some taxpayer advocacy groups.

The Universal Service Fund fee, which would be a 1.1 percent charge on cellphone bills, was approved 22-20 and now heads to the House.

The fund, created in 1997, subsidizes landline construction in rural corners of South Carolina and helps low-income homes get phone service.

The pool of money is currently replenished by landline customers, who pay a fee that has risen as more and more people drop phone service. That rate is 2.7 percent now but would drop to 1.1 percent for landline and cellphone users alike under the Senate measure.

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“We’re just making it a level playing field so that everybody who uses the telephone contributes to a universal system where you can connect with anybody,” said Sen. Brad Hutto, D-Orangeburg, who co-sponsored the bill. “You shouldn’t get a free ride just because you’re calling on a cellphone.”

The proposal has faced opposition from mobile providers and some taxpayer groups, such as the National Taxpayers Union. Billboards have cropped up around Columbia in recent weeks urging lawmakers to vote against the bill.

The $31 million-a-year fund raised questions earlier this year on a Senate panel, where lawmakers said they were concerned about the complexity of the program and the legislation. They agreed in February to let the state conduct random audits of the fund.