Comments on the Current and Future State of the Universal Service Fund

Municipal leaders are on the front lines of the digital divide, responding to the needs and concerns of the communities they serve. As cities, counties, towns, and villages continue to innovate, local leaders are continually searching for ways to connect residents who are locked out of economic, wellness, educational, civic engagement, and other opportunities that are now exclusively online. Currently, at least 42 million Americans have no access to broadband. These Americans are disproportionately low-income and minority households. The Universal Service Fund (USF) helps fill in the gap by providing funding for a myriad of programs addressing some of the largest variables that prolong digital disadvantages for disconnected residents. Without these important funding programs, the burden on local officials working to bring broadband within reach for every household in their communities will only increase. The USF continues to play a significant role in getting and keeping Americans connected. Without USF-funded programs, people most likely to be impacted by digital inequality – low- income populations, people in rural areas, those impacted by natural disasters, and others – will face unnecessary disadvantages. It will also be more expensive to provide them with access to critical government services. Efforts to modernize the USF should include the following actions:

1. Eliminate the eligible telecommunications carrier (ETC) designation, making funds available to more providers that want to serve their communities;
2. Increase data transparency and allow public audits of USF funding;
3. Change the definition of classrooms. Congress should update the E-Rate rules to reflect new developments in distance learning;
4. Recognize that the Broadband Equity, Access, and Deployment (BEAD) will not eliminate the need for the High-Cost Program;
5. Note that the Affordable Connectivity Program (ACP) is not designed to be and cannot be a replacement for the Lifeline program.