Affordable Connectivity Program (ACP)

Mississippi Public Service Commissioner Brandon Presley (D) told the FCC that SurgePhone may be violating affordable connectivity program rules on consumer protection by giving consumers a tablet for a "$10 connection fee" without providing a receipt or required disclosures. Tents were set up throughout the state, but the company didn't disclose the company's name until Presley asked the representatives after waiting in line, he said in a letter Tuesday. Presley said he's "extremely worried about consumers being snookered by Surge" and asked the FCC to "have Surge cease and desist operations" until an investigation is complete. It's "the wild, Wild West" and an "invitation for waste, fraud, and abuse," Presley told us, saying tents were still being spotted throughout the state on Tuesday. The FCC is "looking into the claims raised in the letter," emailed a spokesperson: "We take any allegations of wrongdoing about this program seriously and will not hesitate to take appropriate action as necessary.” Surge didn't comment.

The Infrastructure Investment and Jobs Act "directs the FCC to make sure that all households with women, infants, children, and breastfeeding mothers participating" in the Special Supplemental Nutrition Program for Women, Infants and Children program and "all households with students participating [in] the free and reduced school lunch program are eligible for support from the Affordable Connectivity Program," emailed a spokesperson Monday. Last week, Commissioners Brendan Carr and Nathan Simington raised concerns about ACP enrollees not being required to include a Social Security number in their application to verify their identity (see 2201210082): "To be clear, these kinds of programs do not require social security numbers," the spokesperson said: The FCC "has made sure that every family participating in [ACP] provides identification like taxpayer identification numbers and driver's licenses. But this is about more than the law, it’s the right thing to do to make sure millions of people across the country are not left in digital darkness."

The FCC made changes to its final order on the affordable connectivity program and NPRM on its outreach grant program released Friday, with Commissioner Brendan Carr partially dissenting and Commissioner Nathan Simington concurring in part (see 2201070060). Carr dissented because the order didn't include safeguards against potential fraud in identity verification. "I worry that by not requiring this information, we are turning a blind eye to fraud already happening while leaving the door open for even more benefits going to ineligible households," Carr said. Simington concurred to "draw attention" to ACP recipients not being required to provide "any portion of their social security number" and to his concern that it's "impossible to prevent a consumer from endlessly enrolling in high-cost plans for which such customer has no intention of paying their share of the bill." Chairwoman Jessica Rosenworcel thanked Carr and Simington for "their ideas to improve accountability measures," saying she looks forward to "working with federal, state, and local partners to identify ways to ensure that those who are eligible have opportunities to enroll with the broadband provider of their choosing." The order "repeatedly affirms our decision to spend that money in ways that advance our digital equity goals," said Commissioner Geoffrey Starks. Providers seeking reimbursement for a connected device must include details about the device's market value instead of the proposed applicable wholesale cost. The order clarified that "tablets with cellular calling capabilities" aren't eligible for reimbursement. The program will continue to follow a market value-based approach for reimbursement of connected devices with additional accountability requirements. Universal Service Administrative Co. is required to do quarterly "program integrity reviews." USAC will make data public on household enrollment similar to the tracker used for the national verifier. About 265,000 households are enrolled in ACP, the order said. Few changes were made to the NPRM. It included a question about how to administer a pilot focused on outreach to households in federal public housing assistance programs and other agencies. It asks how the enhanced, up to $75 monthly benefit should be administered to households in high-cost areas.

A draft FCC NPRM on broadband consumer labels like those recommended in 2016 may get pushback from ISPs because the labels would be mandatory for all providers, experts told us (see 2201060057). Consumer advocates said the move is a good starting point and will boost pricing transparency.

The FCC approved rules for the $14.2 billion affordable connectivity program and Further NPRM on outreach funding, as required by the Infrastructure Investment and Jobs Act, said a Friday news release (see 2201120038). "For too many families across the country paying for their internet bill can mean making [budget] sacrifices," said Chairwoman Jessica Rosenworcel: The FCC now "has new tools to support these families and reach those most at risk of digital disconnection for years to come.” The order wasn't released.

FCC draft rules for the $14.2 billion affordable connectivity program were widely welcomed as more consumer protection provisions were included and several ACP changes were made to reflect challenges seen during the emergency broadband benefit program, industry and advocacy groups told us. Some sought minor changes to rules governing participating providers and connected devices. Rules must be finalized by Friday as required by the Infrastructure Investment and Jobs Act.

FCC Commissioner Geoffrey Starks will vote “later this week” on draft affordable connectivity program rules, funded by the Infrastructure Investment and Jobs Act, he said during an Information Technology Industry Council webinar Tuesday. “I expect a lot from this program going forward” (see 2201070060). ACP rules must be finalized within 60 days of the law's enactment, which is Friday.

The FCC should approve rules that allow emergency broadband benefit enrollees to easily migrate to the new affordable connectivity program (ACP), CTIA representatives told an aide to Commissioner Nathan Simington. “An affirmative customer opt-in process for ACP,” as proposed in a public notice, “is likely to lead to large-scale de-enrollment of eligible households, which would disserve the program’s goals,” said a filing posted Monday in docket 21-450. Ensure “that a broad cross-section of broadband providers continues to participate in the program, ensuring competition and multiple options,” CTIA urged.

The FCC released draft rules for the affordable connectivity program Friday, with few changes for providers and guidance for emergency broadband benefit households transitioning to the new program. Chairwoman Jessica Rosenworcel released the draft for feedback "given the importance of this program to consumers," she said: “Congress gave the FCC a very short window to stand up" the ACP "and working with a hyper-accelerated schedule during the holidays, we’ve proven that we are up to the task with this draft." The FCC wouldn't adopt a uniform opt-in requirement for EBB households transitioning to ACP but instead offer a "hybrid approach." Households that wouldn't experience a bill change wouldn't be required to opt in. Those with a "willingness and an ability to pay for broadband" would need to provide consent if they may end up with a bill due to the benefits drop. Households that haven't said they would or could pay must opt in. The draft would keep the same definition of "household" used in Lifeline and EBB. Household eligibility was updated to meet certain statutory changes. Recognizing some eligible households "may experience difficulty accessing or navigating the National Verifier on their own, and may require assistance to complete and submit an application," the draft would require the Wireline Bureau and Universal Service Administrative Co. to do a "one-year test pilot for granting trusted access to the National Verifier for purposes of assisting customers with applying" for ACP. Few changes would be made to the requirements for providers. Providers would need to establish that they offer broadband services to end users before seeking to participate, rather than before December 2020. The FCC was "persuaded by comments not to collect broadband internet service plan information during the election process," the draft said. Similar to the Lifeline program, providers would be prohibited from offering or giving enrollment representatives or direct supervisors compensation based on the number of households that apply or enroll in ACP. The draft cites a recent Office of Inspector General advisory raising concerns about potential misconduct by sales agents. Non-usage de-enrollment rules would mirror the Lifeline program's rules. The FCC received a mixed response on whether "any internet service offering" should include legacy and grandfathered plans. The final rules would include those plans and any that a provider "currently offers to new customers." It further clarified that the requirement "does not require that providers offer such legacy or grandfathered plans to other customers, including ACP-eligible customers, that are not already on such plans." Providers would have 60 days after the final rules are published in the Federal Register to complete any necessary changes to ensure ACP can be applied to "all generally available and currently sold plans." Providers would also be allowed to include taxes and other government fees in the "actual amount charged to a household." The draft would not impose minimum service standards. Smartphones and cellphones would still be excluded. Providers are allowed to perform credit checks only if it's unrelated to the program. Providers would be prohibited from upselling or downselling services. A Further NPRM would also seek comment on implementing an up to $75 enhanced monthly benefit for households in high-cost areas and how to establish its outreach grant program. Comments would be due 30 days after FR publication, 45 days for replies, in docket 21-450. Also released Friday was a public notice allowing ex parte presentations until Jan. 11. Presentations must be filed by Jan. 12.

With enrollment now open for the FCC’s affordable connectivity program and the transition from the emergency broadband benefit program underway, some consumer advocacy groups told us they're concerned that EBB-enrolled households could face a bill shock or lose their benefit entirely if required to affirmatively opt in to receive the new benefit. Several questions remain because the FCC hasn't issued rules for the new program and the higher subsidy amount is set to end March 1.