Connection found: Rural broadband bill gets its day in the Senate

A bipartisan effort to push the Federal Communications Commission (FCC) to expand internet access to rural areas will finally get a Senate hearing this week, two years after the bill was first introduced. 

The Reforming Broadband Connectivity Act has support in both the House and Senate and will get its day in the Senate Commerce Committee Thursday.

“Anything that is effective in advancing the spread of broadband availability has broad support in the committee,” Sen. Jerry Moran (R-Kan.), a co-sponsor of the bill, told The Hill last week.

The bill — introduced by Sen. Amy Klobuchar (D-Minn.) in the Senate and Rep. Joe Neguse (D-Colo.) in the House — orders the FCC to enter rulemaking to determine how to modernize the Universal Service Fund.

Read more from The Hill’s special coverage on the future of broadband here.

The fund comprises a system of subsidies and fees meant to expand telecommunications access in the United States. It was initially focused on telephone service, but lawmakers now see it as a key tool for expanding broadband access for rural areas, low-income households and critical health services.

Telecommunications companies pay into the Universal Service Fund and sometimes levy fees on customers, mostly for long-distance phone calls. But the number of long-distance calls is going down and the need for broadband programs is going up. That’s leading to a crunch.

“The current contribution methodology is just not sustainable,” said Derrick Owens, senior vice president at rural broadband advocacy group WTA.

“We’re seeing people move to VoIP services and broadband,” said Mike Romano, executive vice president of rural broadband trade association NTCA. 

“That drives the contribution factor higher and higher because the pool of revenue from what you’re drawing is smaller and smaller. That just continues to place pressure on how long can keep this going if that contribution factor doesn’t rise.”

The bill also asks the FCC to pay special attention to how any change in the fund would impact seniors. As more seniors have landlines and make more traditional long-distance calls than any other group, they are most impacted by the current structure of fund collection.

While the bill leaves the specifics to the FCC, the idea would be for the agency to levy similar contribution requirements on internet providers and change the contribution levels for other increasingly common forms of communication, Owens said. 

“The Universal Service Fund is facing extinction right as internet access is more important than ever,” Sen. John Hickenlooper (D-Colo.) said in a statement to The Hill. “It’s rural communities who will pay if we don’t fix this.”

The Universal Service Fund system was last modified under the Telecommunications Act of 1996. The new bill focuses on stabilizing current programs with new funding mechanisms.

“But I also think you have to have a conversation about if this could be used to provide additional funding where necessary,” Romano said. “I think the first step is just stabilizing the existing mechanisms.”

If the FCC creates rules to increase fee revenue, that money could supplement the funds already in the fund and provide additional support for programs that expand broadband access to rural areas and for low-income households.

Sens. Moran, Hickenlooper and John Thune (R-S.D.) co-sponsored the Senate bill alongside Reps. Lizzie Fletcher (D-Texas), Angie Craig (D-Minn.), Hal Rogers (R-Ky.), Glenn Grothman (R-Wis.) and Mike Gallagher (R-Wis.) in the House.

“This bipartisan legislation would help ensure we have needed resources to continue expanding broadband access while bringing down costs for consumers, especially for those in rural and underserved areas,” Klobuchar said in a statement to The Hill.

An identical measure was introduced in 2021, also by Klobuchar in the Senate, but it did not pass committee. The bill’s advocates are feeling more momentum this time around.

“Anytime you try to pass legislation, it takes a while for people to sort of understand what it is you’re trying to do … We’re making progress with people understanding this now as we are clearly into a broadband world,” Owens said. 

“Folks recognize that you shouldn’t be funding universal service, which is a maintenance program … based on long-distance voice telephony service.”

Owens added that most congressional staff are too young to have made many long-distance phone calls on a landline, which makes it easier for them to see the merit of redistributing the funds.

“There’s still more we can do to build on this progress and close the digital divide once and for all,” Klobuchar said. “I’ll keep pushing to get it across the finish line.”