As life for most Americans moved online during the COVID-19 pandemic, the disparities surrounding the digital divide captured the spotlight. Media reports of children completing school assignments in parking lots to use free Wi-Fi and American adults struggling without adequate access to broadband brought more national attention to this important issue. There is bipartisan recognition of the problem and support for quickly addressing it. In dueling infrastructure proposals, President Biden’s plan would invest $100 billion while Republicans’ plan appropriates $65 billion for broadband infrastructure, both of which would be a sizable investment. On May 10, the U.S. Treasury Department also issued guidance that the $10 billion Coronavirus Capital Projects Fund created through the American Rescue Plan could be used to invest in broadband. Billions of dollars have also been appropriated through previous coronavirus-related legislation to address broadband connectivity.
As of May 12, consumers are eligible to enroll in the temporary $3.2 billion Emergency Broadband Benefit (EBB) program, which provides up to $50 per month towards broadband services ($75 for households on tribal lands) and a one-time discount of up to $100 to purchase a device such as a computer or laptop. Senators John Thune (R-SD) and Roger Wicker (R-MS) have already called on the Government Accountability Office (GAO) to review the EBB program – and for good reason. The creation of funds and allocation of resources are only part of the solution. As tax dollars are being spent on bringing more Americans online, it is important these resources are directed at those most in need. Troubling data suggests that critical funding is being spent in areas that already have adequate broadband access, and every dollar spent in these areas is less money for those truly in need of funding.
The Rural Digital Opportunity Fund (RDOF) is part of the Universal Service Fund (USF) aimed at closing the digital divide in rural areas. Consumers living in rural populations often find themselves lacking access to reliable high-speed internet due to the increased cost and lower profitability associated with reaching these communities, along with the topographical challenges of reaching certain remote areas. A two-phase reverse auction was intended to direct up to $20.4 billion over 10 years to finance broadband networks in unserved rural areas. However, a recent report from the Competitive Carriers Association (CCA) found that Phase I RDOF funding, which was supposed to be used to connect unserved areas, was actually being spent in urban and sometimes densely populated areas. The CCA report found that the RDOF program would subsidize broadband deployment at large airports, Fisherman’s Wharf in San Francisco, the Massachusetts Institute of Technology campus, and other areas that certainly would not be considered “rural.”
Lifeline, another USF program, has a long and well-documented history of fraud, waste, and misuse. One egregious example is a broadband company that made over 42,000 fraudulent claims for funding in one month alone, and whose chief executive was accused of embezzling aid money to purchase a jet, a Florida condominium, and a Ferrari. Discussed in more detail in this issue brief, the Lifeline program is another well-intentioned program that is intended to assist low-income communities gain broadband access. However, major issues call into question the effectiveness of this program. The EBB program uses the framework of the Lifeline program with key changes. The EBB program provides a larger payment ($50 versus $9.25/month) and also provides funding for a device, which can potentially help close the adoption gap. As some lawmakers have already called to make the EBB program permanent, it is important that careful oversight is being conducted. The troubling history of Lifeline points to why a GAO report of the EBB program is going to be important to determine the effectiveness of this new program.
Some of the issues that plague noble programs are tied to a lack of data, namely mapping. Broadband maps show where high-speed broadband is lacking, but if a single house is served in a census block, then the entire census block is considered “served.” The inflation of broadband coverage can make it difficult to direct resources to those in need. The Broadband Deployment Accuracy and Technology Availability Act (DATA Act) required the FCC to create more granular maps to fix this problem, but taxpayers are still waiting on these to be developed. Proposals to prioritize government-run broadband providers also risk wasting taxpayer dollars and driving out competition for consumers. Taxpayers and lawmakers alike should be skeptical of the idea that more resources or a larger price tag alone will close the digital divide. Targeting resources will ensure a more efficient use of funds and will close the digital divide faster.
Initially, there was an understandable urge to move quickly on funding broadband infrastructure and connectivity. Now, with vaccines widely available and the prospect of returning to a more normal day-to-day life on the horizon, lawmakers should continue to push the FCC to improve mapping and conduct oversight to ensure taxpayer dollars are not being used for subsidized overbuilding. Earlier this year, Senator Wicker, Senator Thune, Representative Cathy McMorris Rodgers (R-WA), and Representative Robert Latta (R-OH) sent a letter to FCC Acting Chairwoman Jessica Rosenworcel demanding answers about the delay in more accurate mapping. Without more accurate maps, closing the digital divide will remain an elusive goal. Throwing more money at the problem without addressing structural problems will continue to leave the unserved communities behind and keep taxpayers on the hook.