OTI to FCC: Don’t Rip Broadband Away From Low-Income Americans

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Feb. 26, 2018

On Wednesday, New America’s Open Technology Institute (OTI) filed comments with the Federal Communications Commission urging the Commission to reject its proposal to gut Lifeline—the only federal program currently designed to make broadband access affordable for the nation’s most vulnerable populations. Two years ago, the Commission updated the Lifeline program to reflect that broadband was imperative to societal participation, a move reflecting Congressional intent. Now, a mere two years later, the Commission proposes a series of damaging reforms that would exacerbate the digital divide and mark an unprecedented reversal in the Commission’s progress toward ensuring universal service. OTI strongly urges the Commission to abandon its proposal and refocus its energy on building upon past successes.

In its comments, OTI makes several arguments. First, the Commission should build upon the 2016 Order rather than repeal it. Standalone broadband should remain part of the Lifeline program because Congress envisioned it would be, cord-cutting shows that consumers want standalone broadband, and standalone broadband will help close the homework gap. OTI further argues that the Commission should preserve its equipment rule that requires Wi-Fi and hotspot-enabled devices because those capabilities help subscribers to make the most of their Lifeline service. The Commission should also retain the Lifeline Broadband Provider designation because it makes the program more efficient and effective.

Second, the Commission should maintain support for non-facilities-based services, also known as wireless resellers, which provide service to the majority of Lifeline subscribers. Limiting the number of Lifeline providers runs counter to Congressional directives, and the Commission’s interpretations of the relevant statutes are exceedingly narrow. Resellers meet the statutory requirements for being Eligible Telecommunications Carriers and fully removing them from the program would have dramatic effects on consumers that rely on resellers for their Lifeline service.

Third, the Commission should reject its proposed lifetime benefit limits. These limitations would substantially complicate the program through increased administrative complexity, jeopardize consumer privacy by requiring extensive data collection and retention, deter consumer and provider participation, and destabilize the Lifeline marketplace. The Item fails to provide any justification for the proposed limits.

Fourth, the Commission should reject the proposed budget cap. The Commission should instead pause and address whether the program’s current budget process has any problems. Once it makes that assessment, the Commission will see that fiscal austerity measures are not needed. The budget cap will only serve to add administrative costs and prevent deserving low-income Americans from getting the benefits they desperately need.

Fifth, the Commission should not force Lifeline providers to collect co-pays. Eliminating these services would destroy the most popular plans in the Lifeline marketplace and abandon the highly vulnerable populations that rely on them. Mandatory co-pays would also create significant administrative costs, as the Commission would have to create a process to ensure that providers actually collect the required customer share. This process would necessarily generate new compliance costs for providers, USAC, and the Commission.

Sixth, the Commission’s proposals would significantly harm Puerto Ricans. Puerto Ricans disproportionately lacked access to broadband even before the devastation of Hurricane Maria. Meanwhile, the island is still recovering from the hurricane that destroyed infrastructure and entire towns. The Commission’s proposals, such as removing resellers, would harm Puerto Ricans in particular. The Commission’s lifetime benefit cap and budget cap would also deeply weaken Puerto Ricans’ ability to use the Lifeline program.

The Commission’s proposal would leave millions of Americans across the country without the communications services they need to participate in modern society. OTI urges the Commission to abandon this proposal and to instead build on prior reforms to make the Lifeline program even stronger.