Pursuant to the Telecommunications Act of 1996, as implemented by the FCC, effective January 1, 1998, Cox is required to pay into a federally-mandated "Universal Service Fund" by means of "contribution factors" to be assessed on interstate and international revenues. The Universal Service Fund provides federally subsidized affordable access to modern telecommunications and information services for schools, libraries, and rural health care facilities which meet specific eligibility standards, as well as provide support to specific federal "Lifeline," "Link-Up," and High Cost Fund" programs used to subsidize local telephone service.

In accordance with FCC guidelines set forth in Order No. 157, Cox has elected to pass-through these Universal Service Fund costs to all retail customers. The FCC calculates the contribution factor each quarter, and each quarter, Cox will adjust its surcharge to match the FCC’s rate.