Brooking’s Senior Fellow Blair Levin says with the Infrastructure Investment and Jobs Act (IIJA) recently passed by the Senate and now before the House, lawmakers have provided much-needed funding for universal service. But to understand what the Senate both did and did not do in the new infrastructure package, we cannot simply focus on spending levels, Levin says in a blog.
The chief of staff for former FCC Chairman Reed Hundt and architect of the National Broadband Plan notes it’s essential to understand how the bill’s four primary pieces of broadband policy fit together to move the country toward its long-held goals of universal access and adoption. ,
First, the Senate funded the capital expenditures likely to be sufficient to deploy a future-proof network to nearly every business and home in the United States. The largest part of the IIJA’s $65 billion is a $42.5 billion appropriation to the states to fund broadband network deployments, prioritizing areas currently lacking a network capable of offering a 25 Mbps download and 3 Mbps upload. Will that be enough to get future-proof broadband networks everywhere? Probably, says Levin.
In 2017, the FCC estimated it would cost $80 billion to deploy fiber—which he calls “a future-proof technology”—to every area of the country, with it costing $40 billion to deploy networks to up the percentage connected from 85 percent to 98 percent, and an additional $40 billion to deploy to the last 2 percent. “Since then, the FCC has spent billions on rural deployment, though not all was spent on future-proof networks. Given the problems with mapping and the lack of an FCC update, we don’t know precisely what the necessary amount will be,” Levin writes.
But he cautions it won’t be enough to cover the operating expense deficits for the final 2 percent of locations, which, as the FCC said in 2017, will still have operating losses even with capital expenses paid for with public funds. That means the universal service program will still need to provide some long-term funding in rural areas.
Second, the Senate provided a subsidy for low-income Americans to connect to broadband, sufficient to both build an appropriate system and to give the FCC time to restructure what Levin calls “the current inadequate and fragile universal service program.” The main reason for most of the lack of connectivity is affordability, according to Levin. The FCC’s Lifeline program offers a $10 monthly subsidy. He says the USF has several problems, and is not enough to address affordability.
The IIJA took this head-on, appropriating $14.25 billion to fund a $30 per month subsidy for low-income Americans to purchase broadband. Further, the legislation indicated that instead of looking at this program as only temporary in response to COVID-19, it should become a permanent support mechanism.
Third, the Senate ordered the FCC to come up with a plan to reform universal service. Congressional funding would accelerate the country’s progress toward addressing both access and adoption challenges. But the new money isn’t a permanent solution for the operating shortfalls in some rural communities; Nor is it to solve the need for continuing Commission support to low-income Americans and anchor institutions such as schools, libraries, and health care facilities, according to Levin.
“In light of both changes and long-term needs, the IIJA wisely instructs the agency to report back in nine months on how to improve “‘its effectiveness in achieving the universal service goals for broadband in light of this Act.’”
Fourth, the Senate provided a surge of funding to address digital training and literacy. There are still millions who have not adopted broadband due to a lack of understanding for how to use it effectively, he says.
Over the last two decades, there have been numerous local efforts, “but we have never as a country committed the resources necessary to address the issue, assuring universal digital literacy for an economy and society that increasingly operates online,” states the expert. He notes the IIJA addresses this issue, appropriating $2.75 billion for digital inclusion efforts to insure that “individuals and communities have the information technology capacity that is needed for full participation in the society and economy of the United States.”
Levin cautions the work of the Senate doesn’t mean the challenges are now behind us. “Implementation will be fraught with complications, and the required reform of universal service will raise many thorny issues. Further, we as a country have not yet begun to fully address the challenge of figuring out how to use digital platforms to improve how we deliver essential services such as education, health care, job training and placement, and public safety, among others,” he writes.
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