FCC Chair Confirms 25 Million Households Could Lose Monthly Internet Subsidy

Jan 17, 2024

By Ted Hearn, Editor of Policyband

Washington, D.C., Jan. 16, 2024 – The leader of the Federal Communications Commission expects 25 million households will be affected in April if Congress fails to inject new money into a two-year-old Internet subsidy program strongly supported by the Biden Administration and a bipartisan coalition on Capitol Hill.

FCC Chair Jessica Rosenworcel said in a Jan. 5 letter to several members of Congress that the Affordable Connectivity Program (ACP) currently has more than 22 million households enrolled, but she expects the number to climb to 25 million in April just as funding is expected to dry up.

“As I recently testified, the [FCC] projects that the ACP will have approximately 25 million enrolled households when the last full benefit is expected in April 2024. Without ACP support, participating households’ broadband bills will increase by up to $30 every month,” Rosenworcel said in a letter that the FCC posted on its website today.

ACP was established in December 2021 with $14.2 billion in funding that reduces monthly broadband bills by $30 for eligible low-income households. The White House has requested $6 billion to keep the ACP running throughout 2024.

Last week, Sens. JD Vance (R-Oh.) Peter Welch (D-Vt.), Jacky Rosen (D-Nev.), and Kevin Cramer (R-N.D.), and U.S. Reps. Yvette D. Clarke (D-N.Y.) and Brian Fitzpatrick (R-Pa.) introduced the Affordable Connectivity Program Extension Act, which would provide the ACP with $7 billion in new money.

Some key Republicans on Capitol Hill, however, are concerned that Rosenworcel has inflated the impact of the ACP’s demise. In Nov. 30 testimony, Rosenworcel said “25 million households” would be “unplug[ged]…from the Internet,” according to a letter she was sent by House Energy and Commerce Committee Chair Rep. Cathy McMorris Rodgers (R-Wash.) on Dec. 15.

McMorris Rodgers and other key Capitol Hill Republicans concerned about the Biden Administration's reliance on deficit spending have argued that new money should focus on households that joined the ACP as first-time broadband subscribers.

In her letter, Rosenworcel provided an estimate on broadband first timers enrolled in the ACP based on surveys taken by the Universal Service Administrative Co. (USAC), which runs the ACP for the FCC.

“The November 2022 pilot survey reported 16% of ACP subscribers were first-time Internet users. The July 2023 survey reported that roughly 20% of ACP subscribers responding to the survey were first-time Internet users, indicating an increase over time,” Rosenworcel said. 

The 20% estimate tracks with Rosenworcel’s Nov. 30 testimony during questioning.

Based on ACP’s current enrollment of 22 million households, the ACP has about 4.4 million households that did not have Internet access prior to their enrollment in the ACP.

McMorris Rodgers criticized Rosenworcel for “targeting taxpayer subsidies to consumers who already had broadband.”

In her letter, Rosenworcel said the Infrastructure Investment and Jobs Act in 2021, which created the ACP, did not excluded households with Internet service.

“… The Bipartisan Infrastructure Law does not limit enrollment in the ACP to first-time broadband users,” she said. “As a result, the agency does not have the authority to limit enrollments in this manner or otherwise condition receipt of support on carriers certifying this information regarding the households they serve that participate in this program,” Rosenworcel said.