Senate Prepares To Dig Into Lifeline Effectiveness, Potential Expansion

Sen. Cory Booker, D-N.J., is the only sponsor of the Broadband Adoption Act on the Communications Subcommittee. He plans to attend the 9:30 a.m. hearing in 253 Russell and press for his legislation’s importance and the need to close the digital divide, a Democratic Senate staffer told us. The other sponsors of the legislation are Sen. Chris Murphy, D-Conn., and Rep. Doris Matsui, D-Calif. Two of its co-sponsors, Sens. Richard Blumenthal, D-Conn., and Ed Markey, D-Mass., also are on the subcommittee. Other co-sponsors include Sens. Ron Wyden, D-Ore., and Elizabeth Warren, D-Mass. The legislation would make broadband eligible for Lifeline subsidies, and a news release said the FCC has the authority to make the legislation’s changes on its own. CTIA, NCTA, Verizon and the Leadership Conference on Civil and Human Rights lauded the introduction.

“To me the real play is at the FCC,” National Hispanic Media Coalition General Counsel Jessica Gonzalez, a witness scheduled to testify Tuesday, told us. She praised the legislation and said if it can pass, wonderful, but she suspected the legislation’s goal may be to signal support to the FCC. "It’s clear that the intent is not that we have to pass legislation before the FCC moves forward."

Subcommittee Chairman Roger Wicker, R-Miss., plans to identify two key questions: “Is the program effective in reaching those it is meant to serve?” Wicker will ask during his opening statement. “And what more needs to be done to root out waste, fraud, and abuse in order to ensure the program is accountable to the consumers who fund it?” A recent GAO report “revealed major outstanding issues,” Wicker will say. “Before again expanding the program, we need to consider what problems remain and how we can address them since consumers are bearing the cost of funding the program with increasing phone bills.”

“CTIA and its member companies are committed to this [Lifeline] evolution, consistent with Congress’s directive to provide an ‘evolving level’ of services through the USF,” CTIA Vice President-Regulatory Affairs Scott Bergmann plans to say in his testimony. “We urge the Commission to ensure any reforms reflect consumers’ clear preference for wireless services to meet their voice and data communications needs. … Given that wireless consumers contribute 44% of the overall federal USF, CTIA has a strong interest in ensuring that consumers are not subject to an unreasonable contribution burden.” CTIA will urge the FCC and Congress to consider “whether it may be more appropriate to support programs of general benefit to the public out of general revenue funds.”

“The Commission -- and Congress -- should proceed with caution,” Free State Foundation President Randolph May will testify. “While there is considerable merit to the notion that, at some point and in some way, broadband service should be supported with Lifeline subsidies, any such revamping of the original concept of Lifeline -- as a ‘safety net’ for access to basic voice service -- should be undertaken in a way that does not threaten the sustainability of the existing program.” May will tell Congress, “It probably makes sense to restructure Lifeline to provide a nontransferable portable voucher that an eligible subsidy recipient can take to any participating service provider.”

Another topic on deck is the recent GAO report that urged better evaluation of the program (see 1504230044). GAO’s Michael Clements, acting director-physical infrastructure issues, will testify and was listed as having made significant contributions to the GAO Lifeline report. Gonzalez said some Hill offices may have misread the GAO report and used its findings to undermine Lifeline. The GAO report showed the FCC has embraced many needed improvements to the program, she said. “The FCC in its NPRM needs to define its performance goals and measures,” she said. “It’s not a reason to delay.” Last week’s FCC announcement about expanding Lifeline prompted some harsh words from Hill Republicans, such as Sen. David Vitter, R-La., who judged any expansion absurd. “I wonder if Senator Vitter has talked to any of his constituents that are subscribers,” said Gonzalez, a former subscriber herself, as she will discuss in her written testimony. “This has human impact, and I think that gets lost sometime. I really don’t appreciate when we make a mockery of [Lifeline subscribers] or stereotype them.”

“While I would agree that the existing program is broken and in dire need of reform, I think it would be a mistake to conclude that the program cannot be fixed and modernized for the 21st Century,” said AT&T Senior Executive Vice President Jim Cicconi, who is not testifying, in a blog post Monday. He laid out several priorities AT&T has for an overhauled Lifeline program: “AT&T believes that the government, not carriers, should be responsible for determining Lifeline eligibility and enrollment … we believe the Lifeline program could, and should, support broadband service. We ought to trust eligible consumers to choose which benefit, voice, data, or a combination of both, best meets their needs.” Cicconi judged “it makes little sense to expand the program financially” due to what he sees as a consensus that it is broken. Gonzalez said she doesn't support the idea of capping the USF fund, as some Hill Republicans have discussed, and pointed out that Lifeline’s expenses amount to a relatively small portion of USF.

The Broadband Adoption Act was referred to the Commerce Committee. The office of Senate Commerce Committee Chairman John Thune, R-S.D., declined comment on the Democrats’ Lifeline legislation. "Waste, fraud, abuse, and a pervasive lack of accountability have undermined the credibility of the Lifeline program," Thune recently warned in a statement, saying Lifeline is "falling woefully short of its mission." Ronald Brise, a commissioner on the Florida Public Service Commission, is also scheduled to testify.