5G Fund for Rural America

It is not controversial to say that the Federal Communications Commission’s (FCC) Universal Service Fund (USF) program is unsustainable. Something must change. Universal Service Fund programs cover the cost of maintaining telephone service in high-cost areas, wiring rural schools, libraries, and healthcare facilities for the internet, and providing devices and services at discounted rates to low-income households.

The Federal Communications Commission (FCC) announced a public workshop for December 10 at 3:00 EST to describe the process for challenging the FCC cellular data maps. The primary purpose is to discuss how local governments can submit bulk challenges to the FCC cellular data map. In September, the FCC announced a new $9 billion 5G Fund for Rural America that will be used to bring cell towers to rural areas with poor coverage.

Earlier this year, a Benton Institute for Broadband & Society survey of low-income households found that 13 percent of Affordable Connectivity Program (ACP) participants (approximately 3 million households) would disconnect their home internet service without the subsidy and 36 percent (or 8.3 million households) would downgrade to a cheaper or slower plan.

The fate of the $8 billion Universal Service Fund (USF) now lies in the hands of the Supreme Court, which has the power to determine whether the subsidy program is unconstitutional. The legality issue concerns the Federal Communications Commission’s choice to delegate the administration of USF programs (Connect America Fund, Lifeline, E-Rate and Rural Health Care) to a private third party—the Universal Service Administrative Company (USAC). The Sixth and Eleventh Circuits have already ruled to uphold the constitutionality of the USF’s current funding mechanism.

Former Federal Communications Commission Chairman Ajit Pai said Congress should fund the $8.1 billion Universal Service Fund through annual appropriations. “I do think that the time has come for Congress to shift this to a general appropriation,” said Pai, FCC chairman from 2017 to 2021. “[If USF were funded by appropriation] we wouldn’t have this situation now where we’re essentially getting more and more money from a declining base of contributors.”

Chris Mitchell speaks with Andy Schwartzman, Senior Counselor at the Benton Institute for Broadband & Society, about pressing legal issues affecting telecommunications policy in the U.S.

The Universal Service Fund (USF) has been stuck in legislative limbo as the government wrestles with how to improve the subsidy program. Experts think USF reform could see momentum in Trump’s second term, but how that will pan out is a trickier question to answer. The USF, which supports broadband access and affordability in rural and low-income communities, is made up of four [sic] smaller programs: Connect America Fund, Lifeline, E-Rate and Rural Health Care. One glaring problem with the current USF framework is the shrinking contribution base.

The future of the $8.5 billion Universal Service Fund (USF), which supports broadband access in schools, libraries, and rural communities, hangs in the balance as three critical court cases move forward. In a rare twist, two cases saw oral arguments on the same day, adding a sense of urgency to the outcomes. These decisions could redefine affordable internet connectivity for students, families, and communities nationwide. We summarize each case and outline the stakes for the E-rate and other USF programs. As we await the courts’ decisions, SHLB is not just observing from the sidelines.

At the Connected Oklahoma – Rural Broadband Summit in Oklahoma City, I shared my thoughts on the future of the Universal Service Fund (USF) and Low Earth Orbit satellites. Here's the homework I asked the audience to do:

There is a political consensus that the United States should continue its nearly century long commitment to assuring that the tools of modern communications are universally accessible and affordable. There is also a consensus that the primary program through which we keep that commitment—the Federal Communications Commission’s Universal Service Fund (USF)—is breaking down.