We didn’t need a new entitlement program — yet Washington created one anyway.
We didn’t need a new entitlement program — yet Washington created one anyway.
C ongress created a new $3.2 billion government program buried deep within an omnibus spending bill that is based on an emergency that doesn’t exist. It’s called the Emergency Broadband Benefit Program, and it will likely stick around after the pandemic emergency has ended.
How this happened is a case study in how Washington works — how free-spending habits combine with a perpetual sense of crisis to justify just about anything. As with most things, it started with good intentions and sensible steps.
When schools closed at the start of the pandemic, access to broadband Internet became a big concern. Students would need the Internet at home to do their schoolwork, families had suffered job losses, and government wanted to help make sure nobody’s access to it got cut off because of an inability to pay.
Ensuring Internet access across the U.S. is within the purview of the Federal Communications Commission (FCC). Under Section 706 of the Telecommunications Act of 1996, the FCC “shall encourage the deployment on a reasonable and timely basis of advanced telecommunications capability to all Americans (including, in particular, elementary and secondary schools and classrooms).” The emphasis on access for education purposes is written into law.
There already is an existing FCC program to help people with low incomes pay for Internet service. It’s called Lifeline, and it’s administered by the Universal Service Administrative Company, a nonprofit created by Congress in the Telecommunications Act of 1996. If you recall the “Obamaphone” controversy, that’s the same program.
The Lifeline program, which boasts a budget of $2.385 billion, has been around since 1985. It provides a subsidy of up to $9.25 per month and is funded by contributions phone carriers make to the Universal Service Fund. In 2016, it was expanded to include broadband.
When the FCC was forced to confront the pandemic, it found that its already-existing program was insufficient. (Perhaps this was because of the Lifeline program’s well-attested reputation for fraud.) In a section of its most recent report on encouraging Internet access, released on January 19, the FCC addresses its “Efforts To Ensure and Improve Connectivity During the COVID-19 Pandemic.”
There we find the extraordinary lengths to which the FCC went to ensure people’s Internet access was not cut off during the pandemic. President Trump declared a national emergency on coronavirus on March 13, 2020. That same day, FCC chairman Ajit Pai announced the Keep Americans Connected Initiative. The initiative included a voluntary agreement wherein a signatory provider pledged to not terminate service, waive late fees, and open WiFi hotspots.
Over 800 Internet-service providers (nearly everyone in the country is covered by one of them) signed the pledge, and many service providers went even further by waiving installation fees, removing data caps, and offering free service for periods of time.
As part of the Keep Americans Connected Initiative, the FCC also took more specific actions to help consumers. It waived Lifeline de-enrollment rules to ensure no one enrolled in the program would have their service cut off involuntarily. It waived regulations that could have hindered access to Zoom and WebEx. It allowed Internet-service providers to use more spectrum to meet higher broadband needs.
When the pledge expired on June 30, 2020, with the pandemic still ongoing, there were concerns about whether service providers’ leniency would continue. Pai sent a letter to Congress explaining that he had asked Internet-service providers to not disconnect customers for failing to pay. Instead, he proposed that they be put on deferred-payment plans.
Nobody wants to be the one to cut off Internet service during a pandemic against the express wishes of the chief industry regulator, and so nearly every company continued to be lenient. Go on your Internet-service provider’s website, and you’ll likely find a page about the things they’ve done to “keep people connected” during the pandemic.
The FCC also used additional money to expand Internet access in other ways. It put an additional $42 million into rural health-care programs. The first coronavirus-relief package, the CARES Act from March 2020, contained appropriations for the FCC. It allocated $200 million to help health-care providers with telehealth services, $50 million to fund libraries and museums that people use to access the Internet, and $16 billion for a collaboration with the Department of Education and state governments on remote learning.
Between already-existing subsidy programs, public-private partnership, and new government action, there was an overwhelming response to make sure people’s Internet did not get cut off. That was in addition to other governmental support, such as the extra $300 per month in federal unemployment benefits that allowed people to pay their bills while they were out of work. By and large, these measures were effective. A Freedom of Information Act request by Daily Dot found that the FCC had received 498 complaints from March 12 to May 1 of 2020 about Internet service being cut off. In a country of 330 million people where over 23 million people were unemployed, that has to be considered a success.
Recall, too, that this was during the high point of unemployment and uncertainty during the pandemic. Unemployment peaked at 14.8 percent in April 2020. It was below 7 percent by October. Consumer spending was nearly back to pre-pandemic levels in October and would arrive there in January 2021. Things weren’t back to normal at the end of 2020, but they were certainly much better than they were between March and May.
It was at this point, the end of 2020, that Congress decided there was a broadband-Internet emergency in need of a new $3.2 billion government program. The Emergency Broadband Benefit Program (EBBP) was established on the 2,422nd page of the 5,593-page Consolidated Appropriations Act of 2021 — or the fourth section of the ninth title of Division N, “Additional Coronavirus Response and Relief.” (If you were curious, there are more divisions than letters of the alphabet; the last one is Division FF — “Other Matter” — the twelfth title of which is “Horseracing Integrity and Safety.”)
The EBBP provides up to $50 per month to qualifying households for broadband service (up to $75 per month if the household is on tribal land). It also provides a one-time discount of up to $100 on a new computer purchase.
Any household making 135 percent of the federal poverty line or less is eligible. There are lots of other ways to qualify, too, including receiving a Pell Grant, having a child who qualifies for free or reduced lunch, or experiencing loss of income from being unemployed. The unemployment eligibility goes to people making up to $99,000.
For perspective, the existing Lifeline program provides benefits of $9.25 per month — the EBBP provides up to just over five times that and is available to a much wider array of people. The existing low-cost Internet service for low-income households from AT&T, for example, only costs $10 per month to begin with. So, in effect, the EBBP is a new government program that is using congressionally appropriated taxpayer dollars to pay people’s Internet bills.
For how long? Until the money runs out or until six months after the Department of Health and Human Services ends the national state of emergency for the pandemic — whichever comes first. As of July 11, there were 3,571,269 households enrolled in the program. With that many participants, the program’s funds won’t be exhausted for about 18 months. If 5 million people are enrolled, funds will last about 13 months.
It’s likely that people will be receiving these “emergency” benefits well into next year because the EBBP only started on May 12. That’s May 12 of this year, 2021. The Consolidated Appropriations Act was signed by President Trump on December 27, 2020, and the section establishing the EBBP gave the FCC 60 days to promulgate regulations for the program. The FCC used all 60 and released the regulations on February 26, 2021. It started a test program on April 19. And it announced the May 12 start date on April 29. (That’s actually pretty fast for the administrative state.)
“Emergency” is being used as a magic word to expand government, not a term to describe reality. The FCC bent over backwards to make exceptions and issue guidance in consultation with Internet-service providers at the start of the pandemic to make sure people’s Internet access wasn’t cut off. All things considered, it was quite successful in doing so. There may have been issues along the way, but the emergency was averted.
Nevertheless, Congress created the EBBP. It’s a temporary program, but will it remain one? Once millions of Americans are accustomed to receiving $50 per month for their Internet bills for possibly a year or more, will Congress have the will to take it away from them?
According to a report from the Congressional Research Service, “Even though the Appropriations Act construes [the EBBP] as a temporary program, numerous advocacy organizations have used its passage to press for long-sought policy reforms on behalf of low-income Americans via the FCC rulemaking process.” It also says the implementation of the program “may provide indication of the future direction of federal broadband policy under the Biden Administration.”
Ensuring students had Internet access for online school during the pandemic was a laudable goal. The FCC achieved it fairly well using the tools it already had. We didn’t need a new entitlement program — yet Congress created one, whether it realized it or not.