Uncertainty Regarding Affordable Connectivity Fund is Affecting Private Investment

WASHINGTON, June 7, 2023 – The uncertainty surrounding the refunding of the Affordable Connectivity Program, which is expected to run out of funds in 2024, has implications for internet service providers, American households, and local governments, said experts at a Broadband Breakfast Live Online event Wednesday.

Uncertainty surrounding the ACP funds has turned private investment into a risky bidding game, said Blair Levin, senior fellow at think tank Brookings Institution’s Metropolitan Policy Program. The ACP increases the amount of private capital that providers are willing to invest in new developments in low-income communities because it increases the estimated take rate, he said.

The ACP is currently subsidizing broadband access for more than 17 million Americans with a discount of up to $30 and $75 a month for low-income and tribal households.

Moreover, ISPs are hesitant to market the program to consumers in a way that would suggest sustainability, as they would face a public relations nightmare if the program were to end abruptly, leaving millions of Americans without internet access, said Levin.

The lack of assurance regarding the ACP funding discourages states, local governments and providers from investing time and resources into training staff, added Adeyinka Ogunlegan, vice president of government affairs and policy at advocacy nonprofit EducationSuperHighway.

“Households need assurance now that the money will not disappear,” she continued. There is an urgent need to apply pressure to Congress to ensure communities get the certainty they need, she said.

The ACP is the lynchpin that connects all other federal funds, added Director of the Capital Projects Fund at the U.S. Treasury, Joseph Wender. If the fund is not replenished by the end of the year, the cascading effect could compromise the effectiveness of other federal broadband infrastructure programs such as the $42.5 billion Broadband Equity Access and Deployment program and the $10 billion Capital Projects Fund by harming affordability and program take rate.

Wender added that it is crucial to avoid reaching a critical point where providers need to notify subscribers about the program’s impending end before renewing the project funds. Consequently, relying on the Universal Service Fund reform to fund the program is not feasible within the limited timeframe.

The USF, funded through a tax on voice service providers, supports four programs that make telephone and broadband services affordable for low-income households, health care providers, and schools and libraries. The fund’s sustainability has been under pressure with voice service revenues declining as more Americans use broadband services.

The urgency for ACP renewal cannot be overshadowed by conversations about USF reform, said Ogunlegan.

The ACP program is the “single most important policy issue in telecommunications in terms of impact on the largest number of Americans,” said Levin.

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Wednesday, June 7, 2023 – Affordable Connectivity Fund (Special Town Hall Edition)

Since being created at the direction of the Infrastructure Investment and Jobs Act of 2021, the Affordable Connectivity Program has gained significant support across multiple sectors. Smaller internet service providers have said that the ACP provides critical funding for building out networks to rural communities, and digital equity advocates have frequently called the program a key part of closing the digital divide for low-income and minority communities. But the program’s success might contribute to its downfall—experts have warned that at the rate people are subscribing, the fund will soon run out of money. This special “town hall” event will address the Affordable Connectivity Fund and the strong desire from many in the broadband world to see it renewed.

Panelists

• Blair Levin, Senior Fellow, Brookings Metro
• Adeyinka Ogunlegan, Vice President, Government Affairs & Policy, EducationSuperHighway
• Amina Fazlullah, Senior Director of Equity Policy, Common Sense
• Amol Naik, Senior Vice President, Public and Policy and Community Engagement, Ting Internet
• Joseph Wender, Director, Capital Projects Fund, U.S. Treasury
• Drew Clark (moderator), Editor and Publisher, Broadband Breakfast

Panelist resources:

• Affordable Connectivity Fund Dashboard, Institute for Local Self Reliance
• LOOKING BACK, LOOKING FORWARD: What it will take to permanently close the K–12 digital divide, Common Sense Media

Blair Levin is a nonresident senior fellow at Brookings Metro and a policy analyst with New Street Research, an equity research firm focused on telecommunications and technology. Levin has also been involved in a number efforts to broaden broadband’s reach and effectiveness, including serving as the Executive Director of Gig.U: The Next Generation Network Innovation Project, an initiative of three dozen leading research university communities seeking to support educational and economic development by accelerating the deployment of next generation networks, leading the writing of a report for the World Bank and United Nations High Commission on Refugees on broadband for refugees, and most recently, working with the National Urban League to write the Lewis Latimer Plan for Digital Equity and Inclusion. Previously, Levin worked with the Communications & Society Program with the Aspen Institute Communications and Society Program, following his departure in 2010 from the Federal Communications Commission where he oversaw the development of a National Broadband Plan.

Amina Fazlullah is the Senior Director of Equity Policy in Common Sense‘s D.C. office where she works on a range of issues including expanding affordable access to technology, privacy, platform responsibility, and digital well-being. Prior to joining Common Sense, Amina was a tech policy fellow at Mozilla, where she worked to promote broadband connectivity in underserved communities (tribal, rural, and refugee communities) around the world. She has testified before committees in the U.S. House and Senate on technology issues impacting vulnerable consumers, kids, and families. She has been featured by the press and at conferences on issues related to broadband competition, Section 230, the digital divide, and dark patterns. She has published multiple research reports about the scale, cost, and solutions for addressing the digital divide. She has served on the FCC’s Consumer Advisory Committee and currently serves as a founding board member of the National Digital Inclusion Alliance. Amina has also worked with the Benton Foundation, U.S. Public Interest Research Group, for the Honorable Chief Judge James M. Rosenbaum of the U.S. District Court of Minnesota, and at the FCC.

Adeyinka Ogunlegan is the vice president for government affairs and policy at EducationSuperHighway, a national nonprofit with the mission to close the digital divide for the 18 million households that have access to the internet but can’t afford to connect. EducationSuperHighway focuses on America’s most unconnected communities, where more than 25 percent of people don’t have internet. As the leader of the government affairs team, Ogunlegan focuses on developing and executing the nonprofit’s policy strategy while bringing together the right coalition of champions to accomplish ESH’s mission to close the broadband affordability gap. Prior to joining EducationSuperHighway, she spent several years at Comcast where she was responsible for legislative advocacy and building partnerships with community-based organizations to close the digital divide.

Amol Naik is a government affairs executive and public policy lawyer with deep expertise in technology and infrastructure policy developed at senior levels in both the private sector and government. He is SVP of Public Policy and Community Engagement for Ting Internet, where he leads the national team responsible for all of Ting’s public policy advocacy at the federal, state and local levels, as well as evaluating new markets, and subsequently collaborating with communities in the manner required for building citywide fiber to the premises networks.  Amol is a civic leader in Atlanta and his interest in digital inclusion comes from his experience growing up in rural North Carolina, where he saw the devastating impact the digital divide can have on underserved communities of color.

Joseph Wender currently serves as director of the U.S. Department of the Treasury’s Capital Projects Fund. He previously served for nearly 13 years on Capitol Hill, most recently as Senator Ed Markey’s senior policy adviser, where he led a team covering a wide range of issues including telecommunications and infrastructure. Wender also worked as then-Representative Markey’s legislative director. Prior to working for Markey, he served as counsel for the House Transportation and Infrastructure Committee. He received his B.A. from Wesleyan University and graduated magna cum laude from Harvard Law School.

Drew Clark (moderator) is CEO of Breakfast Media LLC. He has led the Broadband Breakfast community since 2008. An early proponent of better broadband, better lives, he initially founded the Broadband Census crowdsourcing campaign for broadband data. As Editor and Publisher, Clark presides over the leading media company advocating for higher-capacity internet everywhere through topical, timely and intelligent coverage. Clark also served as head of the Partnership for a Connected Illinois, a state broadband initiative.

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