Federal Universal Service Support Mechanisms Fund Size Projections for Fourth Quarter 2026

The Universal Service Administrative Company (USAC) projects a consolidated budget of $68.06 million for the federal Universal Service Support Mechanism in 4Q2026. Direct costs for all support mechanisms total $30.53 million. Joint and common costs (including billing, collection, and disbursement activities) total $37.53 million. Universal Service Support Mechanisms include High Cost, Low Income, Rural Health Care, Schools and Libraries, and Connected Care Pilot. 

• The 4Q2026 High Cost Support Mechanism funding requirements are projected as follows: $45.97 million for high cost loop (HCL) support, $301.84 million for Connect America Broadband Loop Support (CAF BLS), $6.40 million for Connect America Fund Phase II, $36.59 million for Connect America Fund Phase II Auction, $64.15 million for frozen Competitive Eligible Telecommunications Carrier (CETC) Support, $80.91 million for CAF/Intercarrier Compensation Support, $41.70 million for Alaska Plan Support, $43.11 million for Alternative Connect America Model (A-CAM), $54.76 million for A-CAM II, $269.65 million for Enhanced Alternative Connect America Cost Model (E-ACAM), $10.68 million for Uniendo a Puerto Rico/Connect US Virgin Islands, and $143.64 million for Rural Digital Opportunity Fund. This results in the projected base demand of $1,099.40 million. The following funding requirements will be paid from funds available in the High Cost account: $6.78 million for Mobility Fund Phase I, and $56.17 million for E-ACAM. The total base demand of $1,099.40 million is adjusted as follows: decreased by prior period adjustments of $39.85 million and increased by administrative costs of $19.22 million; resulting in a total projected 4Q2026 funding requirement for the High Cost Support Mechanism of $1,078.77 million.
• The estimated 4Q2026 Low Income Support Mechanism funding requirements are projected as follows: $263.03 million for Lifeline and $0.03 million for Link-Up, resulting in a total funding requirement of $263.06 million. The total fund requirement of $263.06 million is adjusted as follows: decreased by prior period adjustments of $96.83 million and increased for administrative costs of $20.56 million; resulting in a total projected 4Q2026 funding requirement for the Low Income Support Mechanism of $186.79 million.
• The 4Q2026 Rural Health Care Support Mechanism collection requirement of $186.04 million is adjusted as follows: increased by a prior period adjustment of $2.74 million, resulting in a total projected 4Q2026 funding requirement for the Rural Health Care Support Mechanism of $188.78 million.
• On March 25, 2026, the FCC announced the funding cap for Funding Year 2026 of $5,200.28 million. This reflects a 2.8 percent inflation-adjusted increase to $5,058.64 million cap from Funding Year 2025. The filing window for Funding Year 2026 closed on April 1, 2026. Based on applications received, USAC estimates demand for Funding Year 2026 will be $3,264.98 million (net of projected post window close adjustments). USAC proposed to carry forward $600 million from prior funding years as follows, 2003: $0.42; 2004: $0.19 million; 2005: $1.70 million; 2006: $0.27 million; 2007: $0.29 million; 2008: $9.72 million; 2009: $0.56 million; 2010: $0.53 million; 2012: $5.09 million; 2013: $0.34 million; 2014: $1.54 million; 2015: $0.56 million; 2016: $1.33 million; 2017: $1.35 million; 2018: $0.84 million; 2019: $10.59 million; 2020: $69.71 million; 2021: $4.21 million; 2022: $38.10 million; 2023: $261.20 million, 2024: $275.98 million; and 2025: $40.48 million; (net of funds carried back to funding years with a negative carry forward balance). Based on further guidance provided by the FCC in June 2026, USAC applied an additional $125 million to offset the $666.25 million projected Schools and Libraries program demand for Q3 2026. Based on an estimated demand of $3,264.98 million and funds carried forward of $725 million, the 4Q2026 collection requirement for the Funding Year 2026 is $666.25 million. The net fund requirement of $666.25 million is adjusted as follows: increased by the prior period adjustments of $9.64 million70 and increased by $20.96 million for administrative expenses; resulting in a total projected 4Q2026 funding requirement for the Schools and Libraries Support Mechanism of $696.85 million.
• USAC collected $100 million to fund the Connected Care Pilot Program. No additional collections are required.