Voqal Rejects FCC Attempt to Cap Universal Service Fund

Federal Communications Commission (FCC) Chairman Ajit Pai has claimed on multiple occasions that closing the digital divide is his top priority. But a variety of decisions, including a recent proposed rule change to implement a funding cap for the Universal Service Fund (USF) – the largest digital divide subsidy program in the U.S. – significantly undermines this claim.

First – what exactly is the USF? Mandated by Congress by the Telecommunications Act of 1996, the USF is comprised of four separate programs:

  1. High-Cost Support Mechanism provides support to certain qualifying telephone companies that serve high-cost areas, thereby making phone service affordable for the residents of these regions.
  2. Low-Income Support Mechanism assists low-income customers by helping to pay for monthly telephone charges as well as connection charges to initiate telephone service.
  3. Rural Health Care Support Mechanism allows rural health care providers to pay rates for telecommunications services similar to those of their urban counterparts, making telehealth services affordable.
  4. Schools and Libraries Support Mechanism, popularly known as the “E-Rate,” provides telecommunication services (e.g., local and long-distance calling, high-speed lines), internet access, and internal connections (the equipment to deliver these services) to eligible schools and libraries.

Americans share a desire that these programs operate in an efficient and effective manner, but placing an artificial cap on the programs may not only limit their effectiveness, it may also violate the law. The reason these programs were created was precisely because market forces alone will not result in affordable broadband buildout for all. Yet the FCC’s strategy seems to be entirely focused on the very companies that are the reason for this market failure.

Congressional leaders and Democrat FCC Commissioners alike have expressed deep concerns with the plan. FCC Commissioner Jessica Rosenworcel rejected the plan, calling it a “hunger games” for those in need, where students, low-income Americans, patients and rural Americans would be fighting one another for scarce resources.

“This is a rulemaking that proposes to limit universal service efforts at the Federal Communications Commission. It is fundamentally inconsistent with this agency’s high-minded rhetoric about closing the digital divide. It is also at odds with our most basic statutory duty to promote and advance universal service. That’s because it suggests a course that could cut off broadband in rural areas, limit high-speed internet access in rural classrooms, shorten the reach of telehealth, and foreclose opportunity for those who need it most. Worse, it proposes unleashing a fight for support between connecting kids in schools and hooking up hospitals for telemedicine. I do not support an approach that fosters the universal service hunger games. I dissent.”

Hundreds of comments have been filed with the FCC. The vast majority of commenters have urged the FCC to reject this plan.

Voqal and Mobile Citizen recently joined several other groups in sending a letter to the FCC expressing concern specifically for the low-income program. Voqal’s project, Mobile Citizen, is designed specifically to help low-income families and students get the connectivity they need to participate in 21st Century society. Mobile Citizen’s experience has shown that low-income families and students are hungry for affordable broadband access. That is one of the reasons why Voqal and Mobile Citizen have agreed to join a sign-on letter fighting for these programs and opposing this USF cap proposal. As the letter explains:

“The overall Universal Service Fund (USF) cap is just as detrimental as the Lifeline-only cap the FCC previously proposed. This proposal will not address program integrity and instead creates unpredictability for low-income people who might languish on waitlists to receive connectivity at a time of urgent need.”

The initial comment period has ended, and the reply comment period has been extended until August 26, 2019. If you are interested in weighing in, you can visit WC Docket 06-122 to file comments.

Voqal will continue to fight for the students, patients, low-income families, rural Americans and every American in need of affordable broadband access.