FCC Charges and Federal, State and Local Taxes This page describes the various mandated Federal and State surcharges, fees and taxes that can show up on your phone bill. Which charges show up is a function of which state you live in and what services you choose. If you have any questions when you get your phone bill, please call us, we are happy to help. Presubscribed Interexchange Carrier Charge The Presubscribed Interexchange Carrier Charge (PICC) is a fee that long distance companies pay to local telephone companies to recover part of the costs of providing the "local loop." Local loop is a term that refers to the outside telephone wires, underground conduit, telephone poles, and other facilities that link each telephone customer to the telephone network. When the FCC adopted its PICC rules, the Commission stated that business users would pay a disproportionate share of the underlying local loop costs. PICC is not assessed for a residential line or single-line business line. For businesses with two or more phone lines, the PICC is $4.31 per month. Federal Excise Tax This is a three percent tax mandated by the federal government (not the Federal Communications Commission (FCC)). It is imposed on all telecommunications services, including local, long distance and wireless bills. Federal Subscriber Line Charge This was instituted after the break-up of AT&T in 1984 to cover the costs of the local phone network. This charge may appear as "FCC Charge for Network Access," "Federal Line Cost Charge," "Interstate Access Charge," "Federal Access Charge," "Interstate Single Line Charge," "Customer Line Charge" or "FCC-Approved Customer Line Charge." State & Local Municipal Tax This charge is imposed by state, local and municipal governments on goods and services. It may also appear as a "Gross Receipts" tax in some states. State Subscriber Line Charge This charge is mandated by some states’ public service or utility commissions to compensate the local phone company for part of the cost of providing local telephone lines associated with state services, i.e., intrastate long distance and local exchange services. Telecommunications Relay Services Charge This state charge helps to pay for the relay center which transmits and translates calls for hearing-impaired and speech-impaired people. Universal Service Fund (USF) Also called the Universal Connectivity Fee. Because telephones provide a vital link to emergency services, to government services and to surrounding communities, it has been our nation’s policy to promote telephone service to all households since this service began in the 1930s. The USF helps to make phone service affordable and available to all Americans, including consumers with low incomes, those living in areas where the costs of providing telephone service is high, schools and libraries and rural health care providers. Congress has mandated that all telephone companies providing interstate service must contribute to the USF. | 
