NaLA Blog & Latest News

FCC Seeks to Impose Cap on Lifeline Program

October 26, 2017 — Washington D.C. Recent FCC proposals seek to impose caps on Lifeline Program funds.

Universal Service Funds & FCC Proposal for Cap on Lifeline Program

The rulings would seek to impose a $2 Billion cap on the Lifeline Program, whose funds are administered by the Universal Service Administrative Company and account for around 18% of the Universal Service Funds (USF), according to USAC’s 2016 Annual report. The USF also provides funding to additional programs, such as High Cost, Rural Health Care, and Schools and Libraries programs.

“The idea of a USF Lifeline cap has been a contentious one at the FCC. Democratic commissioners traditionally have opposed a cap, perhaps because a cap in the low $2 billion-range would cover only half of eligible recipients, according to government estimates,” writes Joan Engebretson, Executive Editor of Telecompetitor.

Limit Universal Service Funds for Lifeline Program to Facilities-based Providers

In addition to capping the funds to the program, these rulings seek to limit funds to facilities-based providers. Currently, most Lifeline Program participants receive service through re-sellers. This proposal will have the most impact on the continuation of Lifeline Program and its ability to effectively provide support to the low-income families to whom it provides service.

“By requiring participating carriers to be facilities-based, the proposed Lifeline item would reinstate by rule a statutory requirement from which it has granted forbearance definitively.  More importantly, the FCC’s proposed decision would force about 70% of the approximately 10 million Lifeline subscribers to find a new service provider,” states John Heitmann, of Kelley Drye & Warren LLP.

“Many of these 7 million Lifeline eligible subscribers will find that they have few, if any choices – forcing them to pay more for less, purchase a new phone, or lose service.  Nearly all affected Lifeline subscribers would be forced to find alternative service offerings for the no-cost to consumer services they typically have access to today. No wireline service provider offers no-cost to consumer Lifeline services.  With no competition from wireless resellers, Lifeline service offerings are likely to stagnate, become more costly and lack in innovation.   Wireless – and wireless ETCs – lose under the FCC’s proposal.  But the biggest losers will be Lifeline-eligible,  low-income consumers across rural America and especially those in urban America.  The FCC’s proposal for Lifeline is so skewed and disruptive that it is almost certain to threaten the very fabric of bipartisan support that has underpinned the Universal Service Fund for decades.”

No comments
Lee SchaferFCC Seeks to Impose Cap on Lifeline Program

Related Posts

NARUC Discusses Lifeline NPRM’s Proposal

On May 18, 2018, National Association of Regulatory Utility Commissioners (NARUC) met separately with Commissioner Carr’s chief of staff and Chairman Pai’s legal advisor. NARUC expressed their support for the Lifeline Notice of Proposed Rulemaking (NPRM) proposal of respecting the state’s role in program administration regarding eliminating ETCs and suggesting cooperative federalism between the Commission

NaLA Logo

The National Lifeline Association Board of Directors Welcomes David Avila

Kennett Square, PA – (May 1, 2018)- The National Lifeline Association (NaLA) Board of Directors announces the appointment of a new board member, David Avila. Mr. Avila, who will be joining NaLA for a three-year term, has ten years of Lifeline program experience and will assist the organization in supporting Lifeline recipients, providers, and program

Eshoo-and-clark-oppose-FCC-lifeline-changes

Congresswomen Eshoo and Clarke Oppose FCC Lifeline Changes

On Wednesday, March 21st Congresswomen Eshoo and Clarke Oppose FCC Lifeline Changes in a letter to FCC to Chairman, Ajit Pai, encouraging him to protect the Lifeline Program. Eshoo and Clarke Oppose FCC Lifeline Changes After a Recent Committee Vote Congresswomen Anna G. Eshoo and Yvette D. Clarke composed a letter following a recent meeting

Leave a Reply