reform the us low-income broadband program by rebuilding lifeline

The Importance of Effective Implementation

The adage “If you build it, they will come” has served as a motivational phrase for over three decades. However, a crucial addition is warranted: “If you build it well, they will come.”

Lifeline Program: Potential Unrealized

America’s Lifeline program, established to provide monthly subsidies for essential communications services to low-income households, was founded on commendable principles. Initially conceived to ensure universal telephone access, the program has not fully achieved its objectives as the Federal Communications Commission (FCC) has sought to adapt it for a broadband-focused era.

Low Participation Rates

Currently, the Universal Service Administrative Company estimates that only 26% of eligible families are actively participating in Lifeline. This indicates that approximately three out of four low-income consumers are missing out on a benefit to which they are entitled. Despite this, abandoning the program, as suggested in the Biden administration’s infrastructure plan, would be counterproductive.

A Path Forward: Broadband Transformation and Expansion

The present moment offers an ideal opportunity to finalize the transition of Lifeline to a broadband-centric model and to broaden its reach. This can be achieved by increasing the benefit amount to align with current broadband market prices and by making the benefit directly accessible to end-users.

Concerns Regarding Price Controls

Conversely, the White House’s proposal to implement price controls on internet access services, coupled with a phased reduction of subsidies for low-income subscribers, represents a problematic policy approach.

Maintaining Competitiveness and Innovation

If the United States aims to maintain its global competitive edge, foster broadband infrastructure development in underserved rural areas, and sustain the rapid deployment of 5G wireless technology, the government should refrain from imposing price regulations on internet access.

The Risk of Reduced Investment

Artificially suppressing prices in the pursuit of affordability could deprive internet service providers of the necessary revenue to continue investing in robust innovation and maintaining the nation’s communications infrastructure.

Targeted Improvements for Increased Participation

Instead, strategic modifications to the Lifeline program could significantly boost participation rates, thereby realizing the goal of connecting those most in need with essential phone and broadband services – resources vital for employment, education, healthcare, and access to government services.

Streamlining Enrollment

To begin, the process of enrolling in Lifeline should be simplified. Currently, applicants must navigate a self-enrollment procedure. Implementing “coordinated enrollment” – automatically enrolling individuals in Lifeline when they qualify for other government assistance programs like SNAP and Medicaid – would address the current underutilization of the program.

Government Efficiencies

Given the overlap in the populations served by various government programs, a unified qualification process for enrollment in all applicable programs would enhance government efficiency and reach individuals who are currently missing out on benefits.

Insights from Former FCC Commissioner Clyburn

Back in 2014, former FCC Commissioner Mignon Clyburn, speaking before the American Enterprise Institute, highlighted the potential for streamlining the process. She noted that in many states, applicants for federal benefits already provide income documentation and may even undergo interviews. Allowing simultaneous enrollment in Lifeline during the application process for other benefits would improve the consumer experience and optimize government efforts.

Simplifying Benefit Usage and Increasing Benefit Amount

The usability of the Lifeline benefit can be greatly improved by providing the subsidy directly to consumers through an electronic benefit card account, similar to the SNAP program’s EBT card. This would not only enhance convenience but also empower low-income Americans to choose the provider and services that best meet their individual needs.

Encouraging Consumer Choice

Greater consumer choice would serve as an incentive for increased program enrollment.

Addressing the Insufficient Subsidy

The current Lifeline subsidy of $9.25 per month is inadequate to cover the cost of a broadband subscription. A substantial increase in the monthly benefit is necessary to make it truly meaningful. Last December, Congress enacted the temporary Emergency Broadband Benefit, offering low-income Americans up to $50 per month ($75 on tribal lands) to help offset broadband costs during the pandemic. Following the expiration of this emergency benefit, a sufficient monthly benefit to cover broadband subscription costs will be essential.

Reimagining the Funding Source

To support a benefit exceeding $9.25 per month, the funding mechanism for the Lifeline program must be reevaluated. Currently, the program relies on the FCC’s Universal Service Fund, financed through a levy on traditional long-distance and international telephone services.

The Unsustainable Contribution Factor

With the increasing reliance on web-based voice communications and the declining use of traditional telephones, the tax rate has risen to compensate for dwindling revenues from landline services. The contribution factor has more than doubled in the last decade, increasing from 15.5% to an unsustainable 33.4%. Without adjustments, this problem will only worsen.

A Shift to a Broader Funding Base

It is evident that funding a broadband benefit should no longer be linked to a declining technology. Instead, funding for Lifeline could be sourced from a levy shared across the entire internet ecosystem, including edge providers who rely on broadband to reach their customers, or through direct congressional appropriations.

A Call to Rebuild, Not Abandon

These reforms are both practical and achievable. Rather than dismantling the program, it’s time to rebuild Lifeline to ensure it fulfills its original purpose and effectively serves America’s most vulnerable populations.