Lifeline/Low-Income Consumers

House Democrats are pushing to include more than $1 billion in the next economic relief package to help pay low-income Americans’ broadband bills. Democrats are said to be considering whether to distribute the aid through the Federal Communications Commission’s Lifeline program, which provides monthly discounts of $9.25 for about 7 million low-income subscribers, or through a new broadband subsidy program. The push is aimed at helping millions of low-income Americans and newly unemployed workers afford internet services to help them stay connected with family, look for jobs, and continue sc

The coronavirus pandemic has laid bare many of the inequalities in America, including the differences in access to broadband Internet. Three policies that can help: (1) allow cities to provide their own broadband; (2) expand and reform Lifeline; and (3) provide tax incentives to firms that subsidize their employees’ broadband. The first of these policies stimulates the “supply” of broadband, while the second two stimulate “demand.” Together, these policies should help reduce the digital divide.

The time has come for Congress to establish a broadband credit—call it America’s Broadband Credit (ABC)—to ensure that people who can’t afford broadband can use broadband. The debate on whether broadband is a luxury or an essential connection to society is over. Broadband is critical, as Americans have now learned as they work, study, consult doctors, socialize, shop—and really lead their lives from home. But for too many, especially the newly unemployed, the cost of broadband service is not affordable.

In the past 6 weeks, over 30 million people in the U.S. have filed initial claims for unemployment insurance. At a time when we are asked to stay at home to reduce the spread of the coronavirus, many state agencies find themselves overwhelmed by the flood of claims, leaving millions with dwindling resources to pay rent or put food on the table or stay connected via telephone or broadband. A program at the Federal Communications Commission should be a lifeline to keep people connected.

On March 19, 2020, Sens Amy Klobuchar (D-MN) and Tina Smith (D-MN) wrote to Federal Communications Commission Chairman Ajit Pai to urge the FCC to take action to ensure that all K-12 students in Minnesota have access to high-speed internet so they can continue their education while schools are closed in response to the coronavirus (COVID-19) pandemic.

The Federal Communications Commission made it easier for individuals who have lost their employment during the coronavirus pandemic and who qualify for Lifeline benefits to enroll in the Lifeline program. Specifically, the FCC’s Wireline Competition Bureau temporarily waived the requirement that consumers seeking to qualify for the program based on their income must provide at least three consecutive months of income documentation. 

During Federal Communications Commission Chairman Ajit Pai’s tenure, the number of Lifeline recipients has decreased by 40 percent and the program’s budget has shrunk accordingly. Less than 20 percent of Americans who are eligible for Lifeline take advantage of it. While Chairman Pai cloaks his so-called Lifeline “reforms” as efforts to root out “waste, fraud, and abuse,” the majority of his actions have little to do with maintaining the integrity of the program and more to do with harming its recipients.

Lifeline is the only federal program with the sole mission of bringing affordable communications to low-income Americans, and it is a critical aspect of our social safety net during the COVID-19 pandemic. Yet, we know that the number of Americans enrolling in the Lifeline program has remained relatively flat during this crisis, especially in comparison to the surging SNAP applications. Unfortunately, many eligible subscribers who could benefit from the Lifeline program are unaware that it exists. Only 7 million subscribers are enrolled in Lifeline and approximately 38 million are eligible.

Sens Amy Klobuchar (D-MN), Richard Durbin (D-IL) and Reps Marcia Fudge (D-OH) and Anna Eshoo (D-CA), along with 140 colleagues in both the House and Senate, urged Federal Communications Commission Chairman Ajit Pai to work directly with the US Department of Agriculture (USDA) and US Department of Health and Human Services (HHS) to ensure that the millions of Americans who are now eligible for the Supplemental Nutritional Assistance Program (SNAP) or Medicaid due to job loss or reduction in income are informed that they are also eligible for the FCC’s Lifeline program.

The “digital divide” in the accessibility of telecommunications services remains far too wide — and that current needs give urgency to closing it. A lack of sufficient Internet access is very likely keeping 12 million students from doing distance learning while their schools are closed.And the more that low-income communities are dependent on temporary grace from telecom providers, the more they have to lose when this is all over. New ideas are clearly required.