updated 03:40 pm EST, Tue January 31, 2012
FCC outlines changes to LifeLine subsidy program
The FCC has updated its plan to help out poor Americans reach the web. The changes to the 25-year-old Lifeline program, as outlined on Monday, will focus on eliminating waste, fraud, and abuse of the program, with the aim of saving $2 billion over the course of three years.
The near-term target for 2012 is $200 million in savings. The FCC will create a National Lifeline Accountability Database to prevent multiple carriers from receiving support for the same subscriber. Lifeline provides $10 per month to families who qualify. Also new will be a one-per-household rule to all providers in the program, with a household defined as an "economic unit." This will allow multiple families living at the same address to be connected and use the subsidy.
As part of the changes, the LinkUp program, which offered a one-time, $30 credit for installing landlines, will be discontinued. LinkUp will remain in effect in Tribal lands. Toll Limitation, which was a subsidy for carriers for blocking or restricting long-distance service, has also been phased out.
The savings will go toward launching a Broadband Adoption Pilot Program with a budget of up to $25 million. It will aim to increase broadband use for low-income Americans by subsidizing monthly connection costs, though applicants will need to supply their own hardware. Some of the money may also go towards increasing digital literacy at schools and libraries.
The program is funded by the public through their landline and cellphone bills.
Concerns have existed from the start that the repurposed funds could be abused. The updated proposals at least partially address this by preventing carriers from getting more than they're owed.