FCC Chairman Wheeler unveils $1.7B plan to extend broadband to the poor

FCC Chairman Tom Wheeler has announced a number of new proposals that he says will restructure and modernize the regulator's $1.7 billion Lifeline voice service program by redirecting funds to extend broadband to lower income residents.

Wheeler plans to offer recipients of the Lifeline program a choice of phone service, Internet service, or a combination of both services.

In the FCC notice, Wheeler proposes to establish minimum service standards for both voice and broadband, while ensuring that both Lifeline subscribers and ratepayers are getting what the FCC says is "the best possible value from the service delivered."

Gene Kimmelman, who lobbied as a consumer advocate to create the Lifeline program, told The New York Times that adding Internet access to the list is an essential part of everyone's life.  

"Broadband is every bit as important today as plain old phone service was 30 years ago," said Kimmelman, a former Justice Department official who is now chief executive of Public Knowledge, a consumer advocacy group.

Besides bringing broadband services to low income people, Wheeler plans to implement more measures to curb fraud and abuse of the system.

Following initial reforms the FCC developed in 2012, Wheeler's proposal would focus on several areas: require documented proof of eligibility and annual recertification of eligibility; clarifying subscriptions are limited to one per household; establishing the National Lifeline Accountability Database to eliminate and prevent duplicate subscriptions; and independent audits of carriers every two years.

Since the Lifeline was created in 1985 by then-President Ronald Regan to subsidize phone service, over 12 million households participate in the program. As enrollment in the program continued to rise so did abuse of the system, with reports that various households were getting more than their single allowed subsidy. In order to qualify, a household has to have an income at or below 135 percent of the federal poverty line, or must participate in a program like Medicaid or food stamps.

According to a NYT report citing senior FCC officials, a vote on Wheeler's proposal is expected to come on June 18. If the plan gets approval from a majority of the regulator's commissioners, the antifraud measures would take immediate effect. From there, the commission would look at how to incorporate broadband services into the program.

For more:
- see the release
- The New York Times has this article

Related articles:
Fla. telephone company owners accused of bilking $32M out of Lifeline program
FCC claims Lifeline program reforms will save $2 billion by 2014
FCC's Lifeline reforms enable it to save $214M on the program
FCC serves up reworked Lifeline program to weed out fraud, promote broadband adoption
Consumer groups question whether FCC's Lifeline program reforms go far enough

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