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Lawmakers Fight to Salvage Federal ACP Broadband Subsidy, But Outlook Is Bleak

Money runs out on internet program popular with older and low-income Americans

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Subsidies remaining for the Affordable Connectivity Program (ACP) will be exhausted within days, and the 23.3 million households that rely on the federal broadband discounts — more than 2 in 5 headed by someone age 50 or older — are in a bind.

Prospects for a congressional long shot to salvage the popular program appear grim. Though the Senate bill to allocate $7 billion more for the program through the end of the year has an equal number of Democratic and Republican sponsors, any extension is controversial for some politicians.

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At the beginning of Thursday’s hearing in a subcommittee of the Senate Commerce, Science and Transportation Committee, Sen. Ted Cruz (R-Texas) said: “The Affordable Connectivity Program is not working as Congress intended. This massive welfare program should be considered a success, … but it turns out the vast majority of these people already had high-speed internet.”

Almost 22 percent of households surveyed had never had high-speed internet before the ACP, another 23 percent had dropped it at some point because of affordability, and 55 percent were using the program to help keep service during the pandemic and ongoing inflation afterward, according to a Federal Communications Commission (FCC) survey in December 2023.

The Affordable Connectivity Program also supports another part of the bipartisan infrastructure bill signed into law in 2021, the expansion of high-speed internet to areas with no internet or slower speeds, said Sen. J.D. Vance (R-Ohio). Having an ongoing, guaranteed customer base helps companies pay for service to areas with rougher terrain and fewer people.

“I talked to a number of folks who have invested a lot in rural broadband infrastructure in the state of Ohio who told me straightforwardly they would not have made that investment if not for the existence of the ACP program,” Vance said at the hearing.

 In the 435-member House, where an identical bill was filed in January, 225 representatives including 20 Republicans have signed onto the legislation. In November, a bipartisan group of 26 governors sent a letter to congressional leaders in support of the program. By the beginning of February, about 18 percent of U.S. households were benefiting from the ACP. 

Subsidies save money in the long run, studies show

The  ACP is a “money saver to our unemployment system,” Blair Levin, chief of staff for nearly four years to the FCC chair during the Clinton administration, said to AARP ahead of his testimony at the hearing. “If you want to retrain for a job or get a new job and not be on unemployment [insurance], what is the mechanism you’re going to use? Well, it’s going to be online.”​

“I’m pretty sure that health care by itself could justify this” continuation of the program, said Levin, now a nonresident senior fellow at the nonprofit Brookings Metro think tank. “In other words, you save a trip to the emergency room, people in telehealth can show up for their appointments easier, and they do preventive treatments more readily.”

Three-quarters of adults 50 and older had telehealth appointments at least once in the past 12 months, according to an AARP survey conducted earlier this year. And 9 out of 10 were satisfied with the experience.

In the hearing, Levin mentioned a study from the Wilmette, Illinois–based Benton Institute for Broadband & Society that indicated $1 spent in the Affordable Connectivity Program returned $2 in economic benefits to those using the program. Less quantifiable benefits include the convenience of having internet at home rather than going to a library or other public location in search of Wi-Fi, and time and money saved when using telehealth visits versus more expensive options.

Another working paper from two economists at George Mason University in Fairfax, Virginia, looked at the effects of ACP spending on the gross domestic product and found that every $1 spent resulted in $3.89 in economic gains, Levin said. 

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‘ACP discount helps make every dollar stretch’

AARP is also in favor of preserving the internet stipends. The nonpartisan nonprofit submitted a statement at the hearing that highlights the critical role high-speed internet access and affordability play for older adults.

“The ACP discount helps make every dollar stretch just a little further so these households can more easily afford prescription drugs, food and other necessities,” the statement reads in part.

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Senior Planet from AARP has classes to help you understand broadband plans and save money on internet service.

AARP cited recent surveys in which 87 percent of older adults indicated they were concerned about losing online access to government benefits like Social Security and Medicare, more than 7 in 10 about losing communication with loved ones, and 7 in 10 about losing health care services if the discounts were discontinued.

The program has been providing limited-income households (those that earn up to 200 percent of federal poverty guidelines) with $30 a month to cover all or most of the cost of high-speed internet service. The subsidy climbed to $75 per household on tribal lands.

This year, households with a gross income of $30,120 or less in the continental United States qualified. However, the $14.2 billion program stopped accepting new applications and enrollments Feb. 7, a little more than two years after the ACP launched. April was its last fully financed month. 

Partial discount on internet access likely available for May

Some households in the program may receive a partial discount of around $14 in May, though details may vary depending on the internet provider. But without congressional action, the subsidy will be gone by June.

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“We all lose when ACP ends,” said Jennifer Case Nevarez of Santa Fe, New Mexico, who is head of an educational nonprofit called the Community Learning Network. She mentioned a Navajo elder she works with who will have to drive 52 miles to the nearest library to get online just to check her email if the subsidy stops.

The program has been exceedingly popular with older adults. While $30 may seem like a modest sum to some, losing it will force people on fixed or strapped incomes to make difficult economic tradeoffs, whether cutting down on gas and food or going outside the home to take advantage of free internet.

“I ask everyone in this room, ‘Do you use a cell phone, computer or laptop? Do you have internet access at home? Do you ever check emails from home; correspond with staff or constituents online; attend a group meeting online; review documents or do research online; make payments or check accounts; purchase goods, food, or tickets online; access health information or make appointments online?’ The modern world is driving all of us online,” she said.

Consumers have some options to reduce costs

For now, consumers with limited incomes aren’t completely out of options. The decades-old federal Lifeline program provides a $9.25 monthly phone or internet discount for households that earn 135 percent or less of the federal poverty guidelines. Some people may also qualify under certain federal assistance programs.

And some for-profit providers are stepping up with discounts. Households that are enrolled in ACP in Comcast service areas are eligible for the company’s $9.95-a-month Internet Essentials home internet plan, one that has been offered for 10 years.

T-Mobile says its existing ACP customers with Assurance Wireless can keep their service and current pricing through August. Metro by T-Mobile customers with ACP can keep their current discount through the June bill and then have the option for a monthly $15 discount on the ACP line through August.

If you’re receiving ACP benefits with another internet provider, ask the company what discounts and policies they’ll continue to help ease the financial burden. In the meantime, lawmakers are clinging to hope.

“We can’t let this expire,” Sen. Peter Welch (D-Vt.) said Thursday. “But I also want to express my enormous apprehension that this Congress may fail by letting this expire rather than continuing it while we work out the long-term changes that are needed for sustainable access.”

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