Universal Service Fund

The Government Accountability Office (GAO) released a report finding that deceased individuals had enrolled in the program and noting that GAO could not confirm the eligibility of 36 percent of the subscribers it reviewed. Federal Communications Commission Chairman Ajit Pai issued the following statement in response: “Last year, I led an investigation into the Lifeline program that revealed serious weaknesses in federal safeguards. Today’s GAO report confirms what we discovered then: Waste, fraud, and abuse are all too prevalent in the program. Commission staff and the Office of Inspector General have already been developing recommendations to better safeguard taxpayer funds. I stand ready to work with my colleagues to crack down on the unscrupulous providers that abuse the program so that the dollars we spend support affordable, high-speed broadband Internet access for our nation’s poorest families"

The Federal Communications Commission has not evaluated the Lifeline program’s performance in meeting its goals of increasing telephone and broadband subscribership among low-income households, but has recently taken steps to do so. Lifeline participation rates are low compared to the percentage of low-income households that pay for telephone service, and broadband adoption rates have increased for the low-income population even without a Lifeline subsidy. Without an evaluation, which GAO recommended in March 2015, FCC is limited in its ability to demonstrate whether Lifeline is efficiently and effectively meeting its program goals. In a July 2016 Order, FCC announced plans for an independent third party to evaluate Lifeline design, function, and administration by December 2020. FCC and the Universal Service Administrative Company (USAC)—the not-for-profit organization that administers Lifeline—have taken some steps to enhance controls over finances and subscriber enrollment. Nevertheless, GAO found weaknesses in several areas. GAO makes seven recommendations, which FCC generally agreed with:
require Commissioners to review and approve, as appropriate, spending above the budget in a timely manner;
maintain and disseminate an updated list of state eligibility databases available to Lifeline providers that includes the qualifying programs those databases access to confirm eligibility; this step would help ensure Lifeline providers are aware of state eligibility databases and could also help ensure USAC audits of Lifeline providers can verify that available state databases are being utilized to verify subscriber eligibility;
establish time frames to evaluate compliance plans and develop instructions with criteria for FCC reviewers how to evaluate these plans to meet Lifeline’s program goals;
develop an enforcement strategy that details what violations lead to penalties and apply this as consistently as possible to all Lifeline providers to ensure consistent enforcement of program violations; the strategy should include a rationale and method for resource prioritization to help maximize the effectiveness of enforcement activities;
ensure that the preliminary plans to transfer the USF funds from the private bank to the U.S. Treasury are finalized and implemented as expeditiously as possible;
require a review of customer bills as part of the contribution audit to include an assessment of whether the charges, including USF fees, meet FCC Truth-in-Billing rules with regard to labeling, so customer bills are transparent, and appropriately labeled and described, to help consumers detect and prevent unauthorized charges; and
respond to USAC requests for guidance and address pending requests concerning USF contribution requirements to ensure the contribution factor is based on complete information and that USF pass-through charges are equitable.

The Federal Communications Commission’s Wireline Competition Bureau announces the updated standard levels for speed and usage allowances for Lifeline-supported services as required by the 2016 Lifeline Modernization Order. The Bureau specifically announces the newly calculated minimum service standards for fixed broadband. It also reminds providers of the updated minimum service standards for mobile broadband and mobile voice service, as established in the FCC’s rules. These standards will take effect on December 1, 2017. Finally, the Bureau announces that the budget for federal universal service support for the Lifeline program for calendar year 2018 will be $2,279,250,000. Beginning December 1, 2017, the Lifeline minimum service standard for fixed broadband speed will be 15 Mbps downstream and 2 Mbps upstream.

The Senate Communications Subcommittee on June 20 took a deep dive into the Federal Communications Commission's Universal Service Fund, with a focus on rural broadband deployment and telehealth. Chairman Roger Wicker (R-MS) signaled that he and Ranking Member Brian Schatz (D-HI) were reintroducing the Reaching Underserved Rural Areas to Lead [RURAL] on Telehealth Act, which would qualify some rural healthcare providers for USF funds. He said robust broadband connections are vital to the adoption of "lifesaving technology." Wicker, who previously has introduced a bill requiring the FCC to improve broadband data collection, said, "[E]nsuring broadband deployment to rural healthcare providers is a critical component of the USF program." He also said the importance of delivering broadband to rural areas cannot be understated, citing economic and digital innovation.

A change in leadership at the Federal Communications Commission has led to rising uncertainty about the future of efforts to boost broadband access, preserve an open internet, and protect online privacy—all issues affecting the K-12 sector. Atop education leaders' list of concerns is the E-rate, a $3.9 billion federal program that helps schools and libraries pay for telecommunications services. A wide cross-section of experts credits the FCC's 2014 overhaul of the program for helping.

T-Mobile’s business selling service to low-income users whose costs are paid, at least in part, through the Universal Service Fund (USF) Lifeline program is “non-sustainable,” said Braxton Carter, T-Mobile chief financial officer. T-Mobile Lifeline customers represent 4.4 million of the carrier’s 73 million subscribers and “we’re going to eliminate them from the base,” said Carter.

Carter attributed the change in direction to changes in the Lifeline program associated with requirements for voice and data service. The changes to the Lifeline data apparently relate to the FCC’s plan to raise the minimum monthly allotment to 2 gigabytes in 2018 from an initial 500 megabytes. “We don’t think Lifeline is a valuable or sustainable product for our base,” he said. Based on Carter’s comments, some or all of those customers apparently are sold through companies that buy service from T-Mobile on a wholesale basis. Meanwhile, smaller rural carriers have been reluctant to offer Lifeline broadband because the rate they would have to charge for the service would be in the range of $100, which the $9.25 discount wouldn’t go far to cover – a situation the rural carriers attribute to an insufficient USF program budget.

The Federal Communications Commission imposed a penalty of $975,000 against Advanced Tel, Inc. (ATI or Company) for violating its federal regulatory obligations as a telecommunications service provider for several years by failing to file required data and make required contributions to important federal programs.

In ATI’s response to our Notice of Apparent Liability for Forfeiture (NAL), in which we proposed a forfeiture penalty of $1,588,988, ATI asserted an inability to pay the proposed forfeiture, and argued that its penalty should be reduced or cancelled because of the statute of limitations. ATI, however, did not dispute the facts underlying the violations identified in the NAL. For the reasons discussed below, we reduce the proposed forfeiture penalty and assess a forfeiture of $975,000 against the Company.

With President Donald Trump emphasizing his infrastructure revamp proposal, the Communications Workers of America wants Congress to emphasize broadband investment in any plan it approves. That came in a letter to the leadership, Republican and Democrat, of the House and Senate Commerce Committees.

CWA says any broadband infrastructure bill should: 1) direct $40 billion in funding to unserved communities; 2) change the tax laws to accelerate depreciation for broadband capital expenditures; 3) direct $10 billion to the Federal Communications Commission 's E-rate fund for high-speed broadband to schools and libraries; and 4) supplement the FCC's Lifeline subsidy (basic telecom for those who need help affording it) with a $100 tax credit per year on the purchase of broadband by low-income families (less than $35,000 per year).

In schools across the United States, IT departments are routinely tasked with supporting teachers as they move toward more technology-centric instructional environments. It may seem obvious that this can only be done with a foundation of robust broadband infrastructure. In practice, however, schools don’t always know the state of their infrastructure, or how to best improve it. The challenges that school administrators face when budgeting for and deploying technology vary widely, as do their approaches to supporting its use within their schools. Measuring and assessing network health is a critical challenge facing public schools as they plan for both today’s and tomorrow’s broadband needs.
School districts lack network measurement tools.
School networks present unique technical challenges for network measurement.
Network management practices should be considered in any measurement program.
Upstream ISP peering may affect school network performance.
Performance measurements should be compared with data on network capacity.

Public policies are critical in narrowing the digital divide for older adults and ensuring more accessible broadband access. As the current Federal Communications Commission attempts to change the Lifeline program, policy makers should be reminded that older adults constitute a large number of the program’s beneficiaries, requiring access to essential communications with 911 and other emergency service providers, healthcare practitioners, family and friends and other caregivers. Policies and programs addressing privacy and security also are important for this cohort. Broadband access must be viewed as one of many fundamental civil rights. Guaranteeing that all older adults have unfettered internet access will maintain the vibrancy of these alternatives and others, while ensuring that they aren’t further disadvantaged in the technology revolution.