Last week, the Federal Communications Commission (FCC) proposed a new argument on behalf of the agency stating it is not to be held accountable for reimbursing internet and phone carriers for providing subsidized services if the services are not in use. 

The D.C. Circuit as well as the National Lifeline Association (NaLA) were not on board with the argument posed. To put this into perspective, the legal counsel for NaLA released an analogy, “Think of it like a hamburger. If the National Lifeline Association served a hamburger to each of the judges, and Judge Rao ate none of hers while Judge Edwards only ate half, and U.S. Circuit Judge Gregory G. Katsas finished his, the nonprofit would have still spent the same amount on each of those burgers.” 

“My cost in serving those hamburgers is the same thing. I can’t take it back, and I can’t serve it to somebody else,” added John J. Heitmann, a legal representative for NaLA.

In having the carriers set forth a budget based upon its total number of subscribers each month; whether a subscriber uses the services provided or not, the carriers still lose money. Heitmann said a carrier can lose up to $34.25 for every user who doesn’t cure their nonuse within a 15-day span. 

For more information, visit https://www.law360.com/telecom/articles/1319437/dc-circ-mulls-whether-lifeline-carriers-got-raw-deal

The FCC 2017 Lifeline Order, which sought to ban resellers from serving Lifeline-eligible consumers and change the access to Lifeline service for low-income consumers living on Tribal lands, was vacated and remanded by the U.S. Court of Appeals. Chairman David Dorwart released the following press release on behalf of NaLA regarding the court’s ruling.

NaLA Press Release on Ruling on 2017 Lifeline Order

KENNETT SQUARE, Pa., Feb 1, 2019 — The National Lifeline Association is pleased that today’s decision by the U.S. Court of Appeals for the D.C. Circuit vacates and remands the FCC’s 2017 Order that would have eliminated wireless resellers from the Tribal Lifeline program and restricted that program to rural Tribal lands.  The Court’s decision will allow wireless resellers to continue to provide Lifeline service to two-thirds of all participants in the Tribal Lifeline program. 

NaLA looks forward to engaging with the FCC and all stakeholders going forward to ensure that the goal of preserving affordability for eligible program participants remains the primary goal of the program.  The Lifeline program faces incredible challenges in 2019.  Our hope is that this decision will provide the impetus for the Commission and all stakeholders to engage in a transparent and constructive manner so that Lifeline meets its full potential to bridge the affordability aspect of the digital divide.

NaLA would like to acknowledge and thank those who led our team that made today’s victory for Tribal Lifeline subscribers possible.  These individuals include our attorneys, John Heitmann and Jameson Dempsey of Kelley Drye, and Kim Lehrman and Jose Cortes on NaLA’s regulatory affairs committee.  We also want to extend our thanks to the Tribes and the team who represented the Tribes, as their participation in the appeal process was essential to the result achieved today.

–David Dorwart, Chair, National Lifeline Association

About the National Lifeline Association