After millions lose access to internet subsidy, FCC moves to fill connectivity gaps

LOS ANGELES (AP) — The Biden administration is moving to blunt the loss of an expired broadband subsidy program that helped more than 23 million families afford internet access by using money from an existing program that helps libraries and schools provide WiFi hotspots to students and patrons.

Jessica Rosenworcel, chairwoman of the Federal Communications Commission, told The Associated Press last week that the agency had voted in July to “modernize” a federal program known as E-Rate to fill at least some of the gaps left by the Affordable Connectivity Program, which gave families with limited income a monthly subsidy to pay for high-speed internet.

“A lot of those households are at risk of disconnection,” Rosenworcel said after a visit to a Los Angeles elementary school. “We should be clear that it’s not always an on-off switch. It’s about sustainability.”

The Affordable Connectivity Program, part of a broader effort pushed by the administration to bring affordable internet to every home and business in the country, was not renewed by Congress and ran out of funding earlier this year.

Mothers of students at Union Avenue Elementary School, which has a 93% Latino student population, told Rosenworcel that their need for the internet has never been greater. They said the cost of rent and food makes it hard to prioritize maintaining a continuous connection.

After listening to the mothers describe using WiFi in a McDonald's parking lot so they can take part in remote doctor's appointments, pay bills, and provide their kids with an internet connection for their online homework, an emotional Rosenworcel called their stories “chilling.”

“That family and that child are going to have a harder time thriving in the modern world without that connection at home,” she said.

The E-Rate program, established in the 1990s, has provided more than $7 billion in discounts for eligible schools and libraries since 2022 to afford broadband products and services. According to a data analysis by the AP, it offered benefits to more than 12,500 libraries, nearly half of them in rural areas, and 106,000 schools.

For the most recent round of funding, the E-Rate program was expanded to include WiFi on school buses. Starting next year, Rosenworcel said, the list of eligible products will expand to WiFi hotspots.

The Affordable Connectivity Program was helping one in six families in the U.S. afford internet access. Rosenworcel said the decision to include WiFi hotspots in E-Rate was partly a response to the failure to extend the subsidies.

“Every child needs internet access at home to really thrive,” Rosenworcel said.

Alex Houff, who manages digital equity programs for the Baltimore County Public Library in Maryland, said the library began a WiFi hotspot lending program right before the COVID-19 lockdown began in 2020 with around 50 devices. She said the program has grown to include 1,000 devices, which still falls short of meeting demand. There are more than 160 people waiting to use a hotspot, Houff said.

“Most of the time we were hearing from branches that their communities were borrowing these hotspots because it was their only source of connectivity,” Houff said.

Affordability, Houff said, is the biggest barrier to connection. She said the library system would apply for E-Rate funding to double the number of hotspots it offers to patrons.

The expansion of the program has not pleased everyone. The two Republicans sitting on the commission argued that E-Rate was meant to bolster and support internet access within the classroom, not at home or other places where students “might want to learn.”

“The last I checked, schools, which have classrooms, and libraries, are physical locations with addresses; not philosophical, conceptual ideas of instruction or education,” Republican commissioner Nathan Simington said in a statement after the vote.

Rosenworcel, who took over as chair of the FCC after President Joe Biden defeated Donald Trump in the 2020 election, said the Republican members' characterization of where the program ought to be applied was too restrictive.

After the FCC voted to expand WiFi hotspots to school buses, a group of Republican senators endorsed a lawsuit challenging the agency's decision. Sen. Ted Cruz of Texas, who led the group of senators, said in a news release that the commission's new rule was an overreach that would “harm children by enabling their unsupervised access to the internet.”

Disagreements between political parties aren’t the only threat to E-Rate. The Fifth Circuit Court of Appeals — the same one where Sen. Cruz filed an amicus brief about WiFi on school buses — ruled at the end of July that the funding mechanism that supports E-Rate and other FCC-administered internet access programs, known as the Universal Service Fund, is unlawful.

“There is a big cloud of uncertainty over the future of the Universal Service Fund right now because of this Fifth Circuit decision,” John Windhausen, the executive director of the Schools, Health and Libraries Broadband Coalition. “It’s a horrible decision, and it’s totally out of line with past Supreme Court precedent and totally out of line with other appeals courts that have ruled in just the opposite way.”

Further litigation is expected. The case could be taken up by the Supreme Court, Windhausen said.

Chairwoman Rosenworcel said she's confident in the integrity of the Universal Service Fund, saying the Fifth Circuit's decision is “misguided and wrong.”

“It's done a lot of good for the United States to make sure, no matter who you are or where you live, you get access to modern communications,” Rosenworcel said.

Rosenworcel said the FCC could mobilize quickly if Congress would simply renew the Affordable Connectivity Program, which might be the easiest way to address the need.