WASHINGTON, September 28, 2023 – A broadband association asked Congress last week to open the Universal Service Fund to contributions from broadband and Big Tech revenues to allow the umbrella fund to absorb and support the Affordable Connectivity Program.

The industry is concerned that the $14-billion ACP program, which discounts monthly services for low-income Americans and those on tribal lands, is going to run out of money by early next year. Meanwhile, it is universally agreed that the Universal Service Fund, which includes four high-cost broadband programs, is struggling to maintain its roughly $8-billion annual pace without a diversification of its revenue sources.

Jonathan Spalter, president and CEO of USTelecom, told the Communications and Technology subcommittee studying the future of rural broadband on September 21 that Congress could both support the sustainability of the USF and the ACP by forcing contributions from broadband and Big Tech revenues.

The idea is that the extra revenue would solve the USF sustainability question by allowing the fund to continue to support the existing four programs under its purview, while also allowing it to adopt the ACP program, hence removing that program from reliance on Congress for money.

“We can have Congress give the FCC the authorities that it requires to be able to expand the contribution base, integrating the ACP within USF program, and thereby allowing the potentially out of control contribution factor that will potentially bog down the viability and longevity of the Universal Service Fund mechanisms to go down,” Spalter said.

“And in so doing it can expand the contribution base sufficiently to allow not only broadband but importantly the dominant Big Tech companies to participate so that we would effectively fuse the Affordable Connectivity Program with [high-cost program] Lifeline and do so in a way that would actually not require appropriated dollars from Congress.”

The ACP currently has around 21 million Americans signed up, but the FCC says many more are eligible. The commission has been allocating money to outreach groups to market the subsidy program.

While some have argued that the Federal Communications Commission could unilaterally expand the contribution base of the USF, the commission has elected to wait for Congress to make the requisite legislative reforms to give it that authority.

Forcing Big Tech companies, which rely on the internet to deliver their products, has been an idea tossed around by experts and promoted by Federal Communications Commissioner Brendan Carr. Meanwhile, forcing broadband revenues to contribute to the fund has also received good support.

The concern for the ACP program is that the internet service providers rely on the $14 billion to continue to offer discounts.

“With funding set to be depleted early next year, initial notices of service termination could be out during the height of the holiday season in December – that’s a present none of our constituents deserve to receive,” said Congresswoman Doris Matsui, D-Calif.  

“Poverty is everywhere, but higher in rural America, in our region the reason most people can’t adopt service is due to lack of affordability, this impacts more households than lack of infrastructure alone,” said Sara Nichols, senior planner of the Land of Sky Regional Council of Government.

“It’s a program we simply can’t afford to lose,” added Nichols.

WASHINGTON, September 11, 2023 – The White House on Monday announced the nomination of Basil Gooden for Under Secretary of Agriculture for Rural Development in the U.S. Department of Agriculture.

Agriculture Secretary Tom Vilsack touted the nomination in a statement, saying that Gooden “is a widely-respected, accomplished champion for affordable housing, community advancement, and economic development. His public service career is informed by a lifelong commitment to agriculture and rural development.”

Gooden is the current director of state operations for rural development at USDA.

If confirmed for the position, Gooden would be responsible for overseeing the activities of the Rural Utilities Services, which encompasses the Water and Environment Programs, the Electric Program, and the Telecommunications Program, which is dedicated to improving the quality of life for rural Americans through providing funds to deploy rural telecommunications infrastructure.

The administration may seek additional funding for broadband through the department. RUS Administrator Andy Berke, the former mayor of Chatanooga, Tenn., who also served as a Commerce Department official with the title, “special representative for broadband.”

Running USDA’s Rural Utilities Service Isn’t Andy Berke’s First Act in Broadband

If selected for the position, Gooden would fill the void left behind by Xochitl Torres Small, who resigned from the role and was later confirmed by the Senate as deputy secretary of agriculture this past July.

WASHINGTON, August 16, 2023 – Sens Michael Bennet, D-Colorado, and Ted Budd, R-N.C., introduced legislation Wednesday to make it easier for small providers to apply to the U.S. Department of Agriculture’s ReConnect loan and grant program.  

The bill, called the Connecting our Neighbors to Networks and Ensuring Competitive Telecommunications Act, would ensure that federal funding reaches rural communities faster by shortening required permitting deadlines. Representatives Brittany Pettersen, D-Colorado, and Juan Ciscomani, R-Arizona, are expected to introduce companion legislation in the House of Representatives. 

It would establish an office of technical assistance to aid eligible providers with application forms, create a mini-grant program for grants up to $20,000 for small providers and prioritize applications from local government, nonprofits and cooperatives. It would also shorten certain permitting deadlines for USDA-funded projects from 270 to 180 days, create an interagency broadband council to recommend uniform standards for federal programs and expand federal easements for certain electric utilities to enable them to lease existing fiber capacity. 

“It’s time Washington made federal programs easier to access for small providers – who are most attuned to the needs of their customers–and strengthened support for local governments, nonprofit organizations, and cooperatives seeking to provide internet service to rural residents,” said Bennet in a statement.  

The ReConnect program’s application process remains complicated and expensive, added Budd. He said that the process makes it more difficult for small rural providers to get projects approved and that the legislation will make it easier for more Americans to get access to affordable, high-quality internet. 

“Millions of rural Americans continue to lack adequate access to the internet, where the costs of connection can be high and existing service too slow or expensive to be of much use. While the ReConnect Loan and Grant program provides broadband funding for eligible rural areas, the application process can be complicated and prohibitively expensive for small providers,” read the press release. 

Executive Director of the Colorado Broadband Office Brandy Reitter said that the CONNECT Act “marks a significant stride toward bridging the digital divide.” 

The ReConnect program offers grants, loan-grant combinations and low-interest loans for broadband infrastructure to connect rural addresses to high-speed internet. The funds can be used to construct, improve, and acquire facilities that provide internet services to customers’ premises with reliable technologies that are suitable for rural community high-speed internet use.