More Wealth Redistribution

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WASHINGTON – Federal regulators have unveiled a plan for overhauling the $8 billion fund that subsidizes phone service in rural areas and for the poor. It redirects the money toward broadband expansion.

The Federal Communications Commission's plan, adopted Thursday, establishes a new "Connect America Fund" for mobile telephone and broadband in rural communities and needy areas.

The money will continue to come from a surcharge on consumers' and businesses' monthly phone bills. Rates should stay flat or decline for most consumers, FCC officials said. The size of the fund will be capped at $4.5 billion annually. To receive money for network expansions into designated areas, telecommunications companies will be required to enter a bidding competition.

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