Senators introduce amendment to fund ACP and rip and replace

A bipartisan group of senators on Tuesday introduced an amendment to the 2024 Federal Aviation Administration (FAA) Reauthorization Act that would provide $6 billion in funding for the Affordable Connectivity Program (ACP) and $3 billion for the "rip-and-replace" program. The amendment will still require a vote in the Senate or the approval of Senate leadership to attach it to the FAA legislation.

The ACP, which has provided a $30 monthly broadband subsidy for 23 million qualifying low-income households (up to $75 on tribal land), is in its final month of funding, with just a portion of the benefit available for May. The rip-and-replace program, which funds the removal and disposal of wireless network equipment from Huawei and ZTE deemed insecure by the federal government, has a $3.08 billion shortfall preventing operators from moving forward.

Despite the introduction of various bills and entreaties from the White House for more funds, both programs have failed to get the additional appropriations they need from Congress. FCC Chairwoman Jessica Rosenworcel last week warned lawmakers of "significant consequences" if rip-and-replace isn't fully funded. Advocates have warned for many months that ending the ACP will broaden the nation's digital divide.

Related:The Divide: Why NaLA says the fight for ACP funds isn't over

Now a bipartisan group of senators – including Senators Ben Ray Luján (D-NM), Steve Daines (R-MT), Peter Welch (D-VT), JD Vance (R-OH), Jacky Rosen (D-NV) and Roger Wicker (R-MS) – are aiming for a way forward through must-pass 2024 FAA legislation.

ACP reforms

Notably, the ACP funding is $1 billion less than what Congress was originally considering in its $7 billion ACP Extension Act, which would have funded the program for the remainder of the year in its current form.

The amendment filed Tuesday, however, makes some key changes to the ACP that would limit eligibility and thus shrink the program.

Those changes include, among others, eliminating eligibility through the USDA's Community Eligibility Program (while preserving eligibility through Free & Reduced School Lunch), as well as reducing income eligibility to 135% of the federal poverty line (from 200%), which is consistent with the FCC's Lifeline program, and eliminating the one-time $100 device subsidy. The amendment would also implement measures to address concerns about fraud and abuse with the program.

The amendment's introduction on Tuesday drew a round of cheers from industry ACP advocates, including Gigi Sohn on behalf of the Affordable Broadband Campaign. In a statement, Sohn said, "The Senate should move quickly so this extremely popular program can continue. By doing so, Congress would give themselves and the FCC time to start the process of reforming the Universal Service Fund so it can provide a permanent funding mechanism for low-income families to get and stay connected."

Related:How the FCC could save the Affordable Connectivity Program

'Material chance' ACP extension happens

In a note for New Street Research on Wednesday morning, analyst and former FCC official Blair Levin, who has been skeptical that Congress would save the ACP, said that while there "remains uncertainty about the fate of this amendment and the FAA reauthorization process, for the first time we think there is a material chance that an ACP extension happens."

The key reasons for that, said Levin, include the fact that Senators Vance, Wicker and Daines, Republican co-sponsors of the amendment, "carry significant weight in the Republican Senate caucus, suggesting to us a material chance of sufficient Republican support for passage."

Furthermore, the noted reforms speak to Republican concerns with the ACP's eligibility rules and potential for waste, which Levin called "the kind of reforms we thought likely to be necessary to break the long logjam on reform efforts."

Levin also sees the extension funding as starting a "ticking clock" for Congress to then "adopt Universal Service Fund (USF) reforms that would put the ACP (and the rest of the USF system) on a sustainable framework), with those reforms to be implemented by the FCC after the election."

Related:Maximum ACP reimbursement for May down to $14 – FCC