Washington D.C. | April 4, 2024: Buried in the draft Open Internet Order is language that would make it extremely difficult for the FCC to expand USF contributions to fund an ACP-like broadband affordability program.

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Since the Open Internet Order concludes that broadband service is a telecommunications service, the FCC could initiate a separate proceeding to determine how and whether broadband revenue should be included in the USF contribution base. Many were looking to USF Reform as the vehicle to fund a permanent replacement for ACP. 

• Instead of opening up such a huge question to public comment, this order unnecessarily shuts the door to that future proceeding.  The draft order “forbears” from applying Universal Service Fund contributions to broadband Internet Access Services (BIAS). The Commission has never reversed a decision to forbear in this situation.
• A decision not to forbear from applying USF funds to BIAS would not result in broadband companies having to contribute to the Fund immediately—the FCC would have to hold a separate proceeding to figure out if, and how, to apply USF contributions to BIAS.
• The Affordable Broadband Campaign met with FCC staff earlier this month, urging that this decision was unnecessary and outside FCC norms.
• An economic analysis by The Brattle Group predicts that without reform, the contribution factor is increasing at an unsustainable rate (44% in 2025 and almost 50% in 2027).

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Below is a statement that can be attributed to Gigi Sohn, Spokesperson for the Affordable Broadband Campaign: 

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While we welcome the FCC reinstating its oversight over broadband, we are disappointed that the draft Open Internet Order chooses to foreclose through forbearance the critical question of whether broadband internet access service (BIAS)  should be included in the USF contribution base. While we respect the Chairwoman’s concern about increasing consumers’ broadband bills—nobody wants that— the draft order itself admits that the record is complex, which is why we need a further developed record to reach a definitive conclusion on that question. This argues for the FCC to begin a separate proceeding to determine what the impact on consumers would be of requiring BIAS providers to contribute to the Universal Service Fund. That would be sound administrative agency practice.

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The FCC is tasked by law with ensuring that every person in the United States has access to “a rapid, efficient, nationwide, and worldwide wire and radio communication service with adequate facilities at reasonable charges." The ACP is perhaps the agency’s most important program that fulfills that mandate. But the ACP is on life support, and even if Congress extends the program, the proposed funding would only last until the end of 2024. If the FCC does not reverse course, it will close the door to a possible permanent replacement for the subsidy that keeps over 23 million households connected.

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