President Bush signed into law a bill to speed computer subsidies for schools and libraries and to spend $1.25 billion on equipment that will help police find calling mobile-telephone users who call 911.
Telephone companies including SBC Communications Inc. and a group representing networking-equipment makers support the law. It may be one of the last revisions of telecommunications policy before the next Congress begins work on the first major overhaul of U.S. phone and Internet regulation since 1996.
Congress adopted the measure in response to a Federal Communications Commission decision in September that slowed the distribution of $2.25 billion in federal subsidies to schools and libraries and threatened to raise certain surcharges on consumers' phone bills by as much as 42 percent, said Mel Blackwell, a spokesman in Washington for the Universal Service Administrative Co., which runs the program.
With the new law, the government can resume distribution of subsidies to schools and libraries at the normal pace, Blackwell said. On Dec. 13, the FCC decided to increase the rate that determines the surcharge by 20 percent to collect $1.76 billion in the first quarter.
The law is designed to "ensure continued service for educational programs in schools and libraries across the nation and to avoid an unnecessary increase in consumer phone rates," said Walter B. McCormick Jr., president of the U.S. Telecom Association, which represents SBC and other local-phone companies.
The law also provides funds for state and local government purchases of equipment to locate people who dial the 911 emergency services number from a mobile phone. The legislation authorizes as much as $250 million a year for five years in matching grants to government agencies that are upgrading to enhanced 911 systems.
Intrado Inc., the largest U.S. provider of database services for 911 communications, may see increased demand from phone carriers after governments upgrade their systems, said analyst Scott P. Sutherland of Wedbush Morgan Securities in Los Angeles.
Another section of the bill aims to speed deployment of wireless services, such as fast Internet access. It would use money from federal auctions of certain airwaves to buy gear for agencies that would use new frequencies. The House passed such a measure in June 2003.