[1st-mile-nm] FCC denies petition to restore $25 Lifeline subsidy for Tribal residents.

[Richard Lowenberg]

FCC stands by decision to raise broadband prices on American Indians

FCC denies petition to restore $25 Lifeline subsidy for Tribal 
residents.

JON BRODKIN - 7/6/2018
https://arstechnica.com/tech-policy/2018/07/fcc-stands-by-decision-to-raise-broadband-prices-on-american-indians

The Federal Communications Commission is refusing to reverse a decision 
that will take a broadband subsidy away from many American Indians.

Under Chairman Ajit Pai's leadership, the FCC voted 3-2 in November 2017 
to make it much harder for Tribal residents to obtain a $25-per-month 
Lifeline subsidy that reduces the cost of Internet or phone service. The 
changes could take effect as early as October 2018, depending on when 
they are approved by the US Office of Management and Budget (OMB).

Small wireless carriers and Tribal organizations sued the FCC in the 
United States Court of Appeals for the DC Circuit. They also filed a 
petition asking the FCC to stay its decision pending the outcome of the 
appeal.

But the FCC denied the stay petition in a decision released yesterday.

"Petitioners have not shown that they are likely to succeed on the 
merits of their claims," the FCC said. "The 2017 Lifeline Order contains 
a comprehensive explanation of the basis for the Commission's decision 
to limit enhanced Tribal support to rural Tribal areas, and to target 
such support to facilities-based providers."

$25 subsidy eliminated in urban areas

Lifeline has more than 12 million subscribers, and an annual budget of 
$2.25 billion, indexed to inflation. Americans with incomes at or near 
federal poverty guidelines are eligible for Lifeline subsidies, but Pai 
has led several votes to limit the program's ability to help poor people 
buy broadband or phone service. Lifeline is paid for by Americans 
through fees imposed on phone bills.

The FCC's November vote eliminated the $25 subsidy entirely for Tribal 
residents who live in urban areas, claiming that the subsidy isn't 
required to make service affordable in urban settings. (All Tribal 
residents are still eligible for a $9.25 monthly subsidy through 
Lifeline.)

In rural areas, the FCC vote barred Tribal residents from using the $25 
subsidy to buy telecom service from resellers. Most wireless phone users 
who get Lifeline subsidies buy their plans from resellers rather than 
from "facilities-based" telecoms that operate their own networks. The 
FCC vote would thus dramatically limit rural Tribal residents' options 
for purchasing subsidized service.

The petition filed by tribes and small carriers explained that large, 
facilities-based providers have been phasing out Lifeline support, 
leaving resellers as the best option for consumers.

"[A]pproximately two-thirds of eligible low-income consumers on Tribal 
lands have chosen non-facilities-based ETCs [eligible telecommunications 
carriers] as their Lifeline provider, demonstrating the overwhelming 
success of the model," the petition to the FCC said. "At the same time, 
facilities-based wireless carriers have retreated from the Lifeline 
program across the country, including in many states home to American 
Indian tribes like [petitioner] Crow Creek [in South Dakota]. In more 
than a dozen states, AT&T and Verizon relinquished their status as ETCs. 
AT&T and Verizon continue to apply for and receive permission to 
relinquish their ETC status in additional states, and stopped applying 
for ETC status in new states long ago."

As for the other two major nationwide carriers, T-Mobile has "largely 
phased out Lifeline service, explaining that Lifeline was not a 
'valuable or sustainable product for [its] base' of subscribers," the 
petition said. "Sprint is the only one that still participates 
meaningfully as a retail provider in the Lifeline program, but Sprint 
does not provide Lifeline service on Tribal lands."

Separately, the FCC is considering a move that would kick resellers out 
of the Lifeline program nationwide, not just in tribal areas.

FCC made changes illegally, petition says

The petition to stop the Tribal changes was filed by Assist Wireless, 
Boomerang Wireless, Easy Telephone Services Company, the National 
Lifeline Association, the Crow Creek Sioux Tribe, and the Oceti Sakowin 
Tribal Utility Authority.

The petitioners argued that the FCC "failed to comply with its Tribal 
consultation requirements as required by law." The FCC's decision to 
impose the changes without opening another proceeding violated federal 
notice-and-comment requirements and law requiring federal agencies to 
deal fairly with American Indian tribes, the petitioners argued.

Besides that, petitioners argued that the new restrictions are illegal 
in part because the FCC's "claimed benefits are entirely speculative, 
contradict the record in this proceeding," and fail to account for "the 
relative efficiency of resellers that specialize in serving these 
difficult markets."

Pai's decision also "reflect[s] an unreasonable departure from over a 
decade of Commission policy finding that requiring [telecoms] to have 
facilities would undermine the goals of the Lifeline program," the 
petitioners wrote.

The FCC denied that it violated the process requirements or that it 
failed to properly justify its decision. "The Commission clearly 
articulated its belief that limiting the enhanced Tribal benefit to 
facilities-based providers would better incentivize those providers to 
expand their networks in underserved areas," the commission wrote in its 
denial of the petition.

Pai hasn't found much public support in his quest to remove resellers 
from the Lifeline program. As we've previously reported, even broadband 
industry lobbyists and conservative think tanks have spoken out against 
restrictions on resellers, saying that it would deprive poor people of 
broadband choices without achieving Pai's stated goal of expanding 
network construction.

The petitioners' court case against the FCC is ongoing, with final 
briefs from both sides due by August 27.


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Richard Lowenberg, Executive Director
1st-Mile Institute     505-603-5200
Box 8001, Santa Fe, NM 87504,
rl at 1st-mile.org     www.1st-mile.org
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