Brookings reports that Congress should continue the Affordability Connectivity Program (ACP); they are just one of many sources in agreement on this perspective …
Congress established the ACP in the Infrastructure Investment and Jobs Act (IIJA) of 2021. That law correctly observed that “a broadband connection and digital literacy are increasingly critical to how individuals participate in the society, economy, and civic institutions of the United States; and access health care and essential services, obtain education, and build careers.”
To assure that all were connected, the law appropriated $65 billion to broadband. Congress devoted most of the funds to network deployments in unserved and underserved areas, but there was another $14.25 billion allocated to the ACP to assure that broadband would be affordable to all. The program is projected exhaust all its funds sometime in the first half of 2024.
The end of the program would be a disaster for families who generally have little savings or discretionary income and will suddenly face monthly broadband charges of $30 or more. It would also rob the broader economy of an opportunity to grow faster due to universal connectivity. As demonstrated by a 2021 study on the employment effects of subsidized broadband for low-income Americans, such programs increase employment rates and earnings of eligible individuals due to greater labor force participation and decreased probability of unemployment, with a benefit of $2,200 annually for low-income households.
Ending the program would also limit the enormous potential for savings in critical services that broadband can deliver. For example, in health care, data from Cigna Healthcare shows that patients save an average of $93 when using non-urgent virtual care instead of an in-person visit. Similarly, patients save an average of $120 when the virtual visit involves a specialist, and $141 with a virtual urgent-care clinic over an in-person one. Given that the Medicaid-eligible population and the ACP-eligible population overlap significantly, the savings for the government in assuring all can afford telehealth likely pays for itself. In addition, as Brookings Metro has previously noted, widespread broadband access also leads to improved outcomes in education, jobs, and social services, which would be lost if the ACP elapses.
The ACP’s expiration will also create problems for the Broadband Equity, Access, and Deployment (BEAD) Program—the $42.5 billion network deployment program Congress created in the IIJA. A study reviewing the ACP’s impact on BEAD concluded that it reduces the subsidy needed to incentivize providers to build in rural areas by 25% per household, writing: “The existence of ACP, which subsidizes subscriber service fees up to $360 per year, reduces the per-household subsidy required to incentivize ISP investment by $500, generating benefit for the government and increasing the market attractiveness for new entrants and incumbent providers.” As the National Urban League has observed, that study demonstrates that “if Congress fails to reauthorize ACP, the federal government likely will end up overpaying for broadband deployments. As a result, the federal dollars will end up funding deployments to significantly fewer unserved and underserved homes and businesses.”
The obvious solution is for Congress to continue funding the program. That is possible, as it enjoys bipartisan support.