Governors urge FCC to oppose federal phone subsidy overhaul

The National Governors Association is opposing the Federal Communications Commission’s planned overhaul of its Lifeline program, which currently offers phone subsidies to low-income Americans. 

The update being voted on Thursday will give Lifeline participants the option to use their subsidy to help purchase monthly Internet service. The reform will also create a national database to determine who is eligible for the subsidies. 

{mosads}The governors association on Wednesday argued the national verifier would preempt state authority and would allow phone and Internet providers to get around state oversight. The group said the change could lead to increased waste, fraud and abuse.

“Governors call on the FCC to reject a proposed rule that would disrupt the existing state-federal partnership and preempt states’ authority to protect consumer interest by creating a third-party National Eligibility Verifier,” the group said in a statement. 

The FCC has billed the federal verifier as a way to help cut down on abuse and to make it easier for phone and Internet providers to participate by creating a one-stop path to join.  

Many states provide their own matching funds and they say the new system would undermine their programs. They argue they are the first line of defense to scrutinize whether phone and Internet providers are offering good service and not abusing funds. 

The FCC has pushed back on criticism of the change.  

“This new nationwide Lifeline Broadband Provider category does not eliminate the states’ role in the Lifeline Program. It simply gives a new entrant a choice in how it becomes a designated Lifeline provider,” Gigi Sohn, a counselor to the FCC chairman, said in a speech last week.   

Grassroots groups have submitted petitions to the commission in recent days that includes thousands of signatures from people supporting the FCC. Industry and consumer groups are also on board, but they have raised separate concerns about minimum service standards included in the rules. 

The three Democrats on the commission are expected to support the rules, while the two Republicans have expressed continuing concerns.