To revive the ACP, Congress will need to reauthorize it. But it’s not looking likely.
Unfortunately, it’s coming down to details on reforms. Some members take issue with the ACP’s rather expansive eligibility, which may lead to wasteful spending. Some argue that there is a lot of abuse of the program given the self-certification model that some providers used.
Here’s the good news: Both sides seem willing to make compromises. The bad news is that conversations have completely stalled.
The reality is that, if Congress cannot reach a consensus on the ACP to address affordability, it only puts more strain on existing programs like Lifeline, which is funded by the FCC’s Universal Service Fund (USF).
But USF programs are far from perfect.
USF is a general fund that pays for four subsidy programs: Lifeline, the High-Cost Program, the Rural Health Fund, and E-Rate. Lifeline and E-Rate are the ones most akin to the ACP. Lifeline provides subsidized telephone and broadband services to low-income individuals. E-Rate provides discounts for telecommunications, internet access, and internal connections to schools and libraries.
Even though these programs seem arcane, you most likely unknowingly interact with USF already—because you, the consumer, fund it when you pay your monthly phone bill as a surcharge for your service. Since 2002, the tax to you has steadily risen from 6.8 percent to an astonishing 34.4 percent, increasing your phone service cost. Sadly, that figure is only going to increase further.
Not only is consumer cost a concern, but USF programs are notoriously inefficient at closing the digital divide. Keep in mind, Lifeline has been around since 1985 and has yet to make similar dents to broadband adoption that ACP has accomplished in just three years. And USF compliance costs are fairly high for companies seeking to participate.
Fortunately, a bipartisan group of senators is looking into USF reform and, even better, there are solutions on which both parties can agree. One is for Congress to simply roll the ACP into USF’s contribution regime and have it take the place of less efficient programs with similar mandates, like Lifeline.
Much of what I read daily is industry publications. It’s always interesting to look at what a mainstream source, such as Newsweek, is saying. They hit on the topics that they think will interest more folks, and in an area such as telecom, they focus on making it easy to understand. It’s worth the extra minute to read the full article.