Without the ACP, What’s the Outlook for Affordable Broadband

The federal Affordable Connectivity Program, which dedicated $14.2 billion to help connect 23 million households across the country to high-speed internet, has run out of money.

Created as part of the 2021 Bipartisan Infrastructure Law, the ACP served 800,000 military families and 5 million older adults, as well as residents of color and those living in rural areas. It gave recipients the chance to access online educational resources, employment opportunities, telehealth services and government assistance, and to more fully participate in civic life. The ACP offered low-income households a monthly discount of up to $30 toward internet service and up to $75 for households on qualifying tribal lands, as well as a one-time $100 discount to buy a laptop, desktop or tablet computer.

But with funding gone, the Federal Communications Commission has ended the program. Program recipients received their last full discount in April, though some households received partial benefits through May.

To better understand the program's impact, the FCC surveyed ACP recipients in December 2023. According to the agency, 77% of respondents say losing their ACP benefit would disrupt their service by making them change their plan or drop internet service entirely. One-half to three-fourths of recipients also report using their internet service for work, health care appointments, job applications and schoolwork. Finally, when asked how losing their ACP benefit would affect them, many say they would need to cut other basic expenses such as food or gas if they had to pay $30 more out of pocket for their internet. Others say they would drop their internet service.

Recent Pew Research Center surveys found that while 87% of U.S. adults with annual household incomes of $30,000 or less say they use the internet, just 57% of them have broadband at home. Citing the high monthly cost of an internet connection, 45% of U.S. adults do not have broadband.

The end of the ACP also has economic implications. According to research by the Chamber of Progress, a technology organization, low-income Americans will lose over $20 billion annually in economic benefits resulting from the loss of their internet subsidy as well as access to jobs, education and telehealth.

Inaction by Congress

There is widespread support for extending ACP funding among the administration, consumer advocates, the broadband industry and members of Congress on both sides of the aisle.

President Joe Biden, along with FCC Chair Jessica Rosenworcel, have been calling on Congress to enact legislation to extend the ACP through the end of 2024. The president also included funding for the program in his 2025 budget request.

In addition, a bipartisan, bicameral group of lawmakers continues to lobby leadership for $7 billion to keep the program running through 2024 as policymakers work to identify a longer-term funding solution. The group, which is led by Sens. J.D. Vance (R-Ohio), Peter Welch (D-Vt.), Kevin Cramer (R-N.D.) and Jacky Rosen (D-Nev.) and Reps. Brian Fitzpatrick (R-Pa.) and Yvette Clarke (D-N.Y.), has the support of a larger bipartisan group in both the Senate and the House. The group has urged Congress to pass the Affordable Connectivity Program Extension Act of 2024 (S. 3565) either as a standalone measure or as an amendment to larger piece of must-pass legislation.

"I'll say that it presents an opportunity for us to do the right thing," Vance told his colleagues on the Senate floor. "Make reforms to the ACP program where it needs to be reformed, but to do the right thing, reauthorize this program and ensure that Ohioans and people all over our country don't have to choose between internet service and food."

In mid-April, 20 House Republicans wrote to Speaker Mike Johnson, urging Congress to take immediate action to secure short-term funding for the ACP so their residents can keep vital internet access.

Despite these calls to action, a handful of senators and representatives, including those on committees with jurisdiction over broadband issues, have criticized the program as "wasteful." Congress has not acted on the bill or other proposals to extend funding for the program.

Other Investments in High-Speed Internet

In addition to the ACP, the Bipartisan Infrastructure Law also created the Broadband Equity, Access and Deployment (BEAD) program, which provides $42 billion to states and territories to work with service providers on building broadband infrastructure in unserved and underserved parts of the country. The BEAD program and the ACP were intended to work together, incentivizing providers to build networks in rural and low-income areas and then offering a subsidy so individuals and families could afford the cost of high-speed service. Unfortunately, if residents can no longer afford their internet service, the end of the ACP could undermine the billion-dollar BEAD investments providers, governments and taxpayers are making in new infrastructure.

In recent testimony before a U.S. Senate hearing on broadband affordability, Kathryn de Wit of the Pew Charitable Trusts said the "ACP's dissolution is adding risk to these programs at a critical moment in project planning for state policymakers and private sector partners. ... As providers across the country have noted, the existence of ACP will factor into their decision to participate in the program."

State Efforts to Support Access

States and localities are doing their best to support their residents, understanding that affordability is critical to assess. Hawaii, Illinois, Louisiana, Michigan, New Jersey, New Mexico and Rhode Island adopted resolutions urging Congress to support continued funding of the Affordable Connectivity Program.

"Louisiana is in an urgent effort to connect our citizens to broadband. The results we hope to see from this progress depend on the affordability of that connection," says Louisiana Sen. Beth Mizel (R), who sponsored the Senate Concurrent Resolution this year. "The Affordable Connectivity Program provides financial assistance and gives the public access to that information in a large way. This program is a critical component for full access to connectivity, and Louisiana needs that tool in our toolbox."

To help bridge the loss of the ACP, states and local governments are exploring ways to increase their broadband support programs so residents can stay connected, and the BEAD program can realize its intended purpose.

According to NCSL, 45 states enacted legislation in 2023 to expand broadband access and affordability, and efforts continue in 2024. Some states, including Wisconsin and Oregon, are relying on revenue from the FCC's Universal Service Fund to help residents afford broadband service. The fund provides discounts and subsidies to low-income consumers for qualifying telephone and internet service. States are also working closely with service providers to bring down costs for low-income residents while still ensuring the sustainability of the service, especially in rural areas.

State legislators have proposed creating state-run programs in response to the ACP's termination. If enacted, California SB 1179 would require the state Department of Technology, in coordination with the Public Utilities Commission and the Department of General Services, to develop and establish the Affordable Internet and Net Equality Act of 2024. The bill "will align the interest of public and private stakeholders to ensure an affordable internet service is available for low-income California households," Sen. Maria Elena Durazo (D) says.

Connecticut S.B. 3 proposed establishing the Net Equality Program, requiring qualified internet service providers in the state to switch eligible households to affordable broadband internet access service, capped at $40 a month. The bill passed the Connecticut Senate but died in the House as the session ended.

Some bills are more narrowly targeted to assisting specific groups. For example, New Jersey A.B. 3201 and its companion S.B. 2634 would establish the Digital Divide Solutions Grant Program within the state's Department of Education to assist school districts, charter schools and renaissance schools in the purchase of online instruction equipment for students who lack access to such equipment. The program could be used to defray the costs of purchasing a connected device for every student without one, and a Wi-Fi hotspot and mobile broadband service for every household that includes a student who lacks internet access.

Finally, nonprofits are partnering with states, localities and residents to close the digital divide and can be a resource for finding a lower-cost service option. According to CNET and Stateline, examples include:

• Connect All and Human-I-T, providing refurbished computers and other devices.
• Everyone On, Internet for All Now and the National Digital Inclusion Alliance, providing tools for finding low-cost plans
• DigitalC and Project Waves, offering low-cost or free internet service in Cleveland and Baltimore, respectively.

Reworking, Restarting the Program

While Congress did not act in time to save the ACP before it lapsed, many policymakers and advocates are hoping there will be sufficient momentum and support to reinstate the program soon. A restarted ACP likely would include some adjustments but any effort to sustain the gains in affordability that the ACP brought to millions of households would be a welcome relief.

Discussions have included tweaking program eligibility, implementing stricter eligibility verification requirements, and reducing the subsidy amount, to name a few. Some legislators have suggested greater streamlining between the ACP and the Universal Service Fund's Lifeline program, which provides discounted broadband or phone service to low-income consumers, or rolling the ACP into the Universal Service Fund. In addition, U.S. Sen. Maria Cantwell (D-Wash.), chair of the Senate Committee on Science, Commerce and Transportation, has proposed legislation that would reinstate the FCC's ability to auction access to specific communications frequencies, known as spectrum, and use the revenue to fund the ACP.

The spectrum frequencies are used to provide wireless services, such as radio broadcasting, mobile communications and satellite services. Spectrum auctions have raised more than $233 billion for the federal government. The agency's authority to conduct the auctions expired in March 2023.

It is likely that all these ideas will be vetted should Congress decide the ACP is worth saving to ensure that all consumers can engage more fully in the digital world and reap the economic benefits. Until that time, many state legislatures are aiming to fill the gap by creating policies and programs to give their residents the affordable connection they need.

Barrie Tabin and Heather Morton staff NCSL's Technology and Communications Committee.

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