Upcoming policy issue

As of June 1, the Affordable Connectivity Program (ACP) is officially exhausted. This means that the 23 million households that rely on it can no longer receive a $30 per month discount on fixed or mobile broadband service. Without the ACP, customers’ main option is the antiquated Lifeline program, which offers $9.25 per month toward broadband service.

The Financial Services and General Government Appropriations Bill provides a total discretionary allocation of $23.608 billion, which is nearly 20 percent below the President’s Budget Request and nearly 10 percent below the effective spending level provided in Fiscal Year 2024. The defense portion of the allocation is $45 million, and the non-defense portion of the allocation is $23.563 billion.

For years, the federal government has avoided any attempt to resolve a long-standing problem: how to sustain funding for the Universal Service program. But perhaps that could change now that the lack of funding for the Affordable Connectivity Program (ACP) has gained substantial mindshare with the American public. Some stakeholders believe both problems can be solved by funding the ACP through the Universal Service Fund (USF) and expanding the types of entities that are required to pay to support the program.

Congress inserted an interesting requirement into the bill that reauthorizes the funding for the National Telecommunications and Information Administration (NTIA). Both the House and Senate added language that would require that a national broadband plan be created that would try to put the Federal Communications Commission, the NTIA, US Department of Agriculture, and other agencies on the same page.

On May 2, 2024, New Street Research Policy Advisor and Brookings Nonresident Senior Fellow Blair Levin testified before the Senate Subcommittee on Communications, Media, and Broadband at a hearing entitled The Future of Broadband Affordability.

As expected, broadband industry lobby groups have sued the Federal Communications Commission in an attempt to nullify net neutrality rules that prohibit blocking, throttling, and paid prioritization. Lobby groups representing cable, telecom, and mobile Internet service providers sued the FCC in several US appeals courts.

 The Affordable Connectivity Program provided a way to bridge the digital divide for over 23 million US households, but congressional inaction has led to its unfortunate end. The consequences will be devastating. Soon, many underserved families in rural and urban communities alike will have to make the difficult sacrifice of losing access to telehealth services, online learning, employment opportunities, and so much more. Reliable broadband is essential to our way of life and economy. Without it, millions of families relying on the ACP for internet access will be left out and left behind.

“It is incredibly disappointing and just plain shameful that one of the most successful bipartisan programs to close the digital divide has lapsed. Every Congressional district in the country had constituents benefiting from this program, and still, Congress failed to deliver the funding needed to ensure that over 23 million households won’t lose connectivity. While the efforts made by the program's most ardent supporters in both Chambers were commendable, the resulting lapse of ACP makes it clear that the Congressional appropriations process is ill-suited for funding affordable broadband.

At the end of May, the Affordable Connectivity Program, which helps over 23 million low-income households access high-speed internet at home, officially ran out of funding. This lapse occurs despite strong support from the White House and lawmakers of both parties, as well as the backing of four out of five Americans. The focus must now shift to delivering a long-term fix. Fortunately, the solution is staring us in the face.

The end of the ACP will undo the significant progress we have made toward closing the divide and harm millions of Americans. Not only that, but it will have economic and competitive consequences for our country if we fail to maximize the $42.5 billion investment we’ve made in broadband infrastructure through the Broadband Equity Access and Deployment Program. It is, as they say, penny wise and pound foolish. Connectivity has never been more important.