How to Bridge the Digital Divide? Assessing the Affordable Connectivity Program
Last year's Infrastructure Investment and Jobs Act (IIJA) allocated $65 billion toward addressing disparities in broadband access across the nation. A key component of the legislation, the Affordable Connectivity Program (ACP), subsidizes broadband subscriptions for low-income households. However, participation in the program has been low so far, suggesting that the ACP may not yet be reaching many of the underserved households that the legislation targeted.
This article explores the background of the Affordable Connectivity Program and its participation levels across the Fifth District in its first year of operation. The challenges that small internet service providers (ISPs) face enrolling people in the program and adhering to its regulatory requirements bring to light an opportunity: Reducing the administrative burden and providing additional training and advertising could enable higher participation in the ACP.
Who is Eligible for the ACP?
The ACP's goal is to address the adoption component of the digital divide by making broadband more affordable to households in areas where the infrastructure exists. Households with incomes at or below 200 percent of the federal poverty guidelines or households in which any member participates in a recognized federal assistance program qualify for the ACP benefit.
The ACP, which is facilitated by the Federal Communications Commission (FCC), provides a $30 per month discount for internet subscriptions for eligible households and a one-time $100 discount for purchase of a device (laptop, desktop, tablet).
Participation in the ACP
Rural LISC, a community development organization, has been tracking participation in the ACP at the ZIP-code level across the country. They estimate the percentage of a ZIP code's population that is participating in ACP by dividing the number enrolled (based on administrative data from the Universal Service Administrative Company) by the estimated number of households that live at 200 percent of the federal poverty level (using data from the U.S. Census' American Community Survey). As of May 1, 2022, the average participation in ACP by ZIP code is estimated to be 17 percent nationwide, while total participation as a share of national eligibility is estimated at 27 percent.
Most of the ZIP codes in the Fifth District are in the lowest bracket of ACP participation, with 0 to 24 percent of eligible households enrolled. However, there are some hot spots of uptake in and around the District's larger cities. The pattern is not surprising, since the ACP cannot help households in areas that do not yet have broadband infrastructure, many of which are located outside of major metropolitan areas. (Billions of dollars in the IIJA were allocated for enhancements to broadband infrastructure, but it will likely take years to use those funds to connect most of the country's unserved areas.)
The maps below depict ACP participation for three of the Fifth District's largest cities, all of which have extensive broadband infrastructure. Washington, D.C., contains the highest ACP participation rates, followed by Baltimore and Charlotte.
The Role of the Internet Service Provider
The low level of participation in the ACP over 2022 was a surprise to ISPs. "Many people [in our organization] thought we were going to be very busy with ACP inquiries and ACP-related installations, but that expectation quickly evaporated," says Kara Chandeysson of Ting Internet, a growing national ISP that first launched in Charlottesville, Va., in 2015. "What we've instead noticed is that many qualifying residents — both within the state and across the country — are not aware of the program." Advertising and educating the public on how to sign up for the program has fallen on the ISPs themselves, which poses a challenge to smaller ISPs such as Ting.
Beyond educating the public about who qualifies for the ACP and how to sign up, the administrative process to comply with the program's regulations can be cumbersome for ISPs. "We normally charge $50 per month for service, but $20 per month for ACP subscribers. After charging the $20 per month discounted rate to eligible subscribers, we must apply for the $30 reimbursement through a government website portal," says Alan Fitzpatrick of Open Broadband, a small North Carolina-based ISP. Fitzpatrick described the process, which includes collecting personally sensitive information from subscribers (last four digits of Social Security numbers, salaries, etc.) and hours spent on the phone with a support desk to navigate the portal's multi-layer approval process. "With what we have learned about the process, it's going to be a lot easier going forward, and we will continue to support the program by signing up qualifying subscribers that request the discount."
Optimizing the ACP
The administrative burden that the ACP places on smaller ISPs to educate and enroll users could disincentivize them from advertising and expanding the program. "We may be missing opportunities to fully engage rural places in closing the digital divide," says Christa Vinson of Rural LISC. "The steps for enrollment and reimbursement are significant for smaller ISPs and may be inhibiting uptake in rural areas. We want to see this program reach as many eligible households as possible and welcome any efforts to streamline participation for all providers."
The ACP's reliance on private business is not a new feature of a government benefit program. For example, the Supplemental Nutrition Assistance Program (SNAP), a federal welfare program that provides nutrition benefits, has relied on private retailers to provide access to food for qualifying individuals for over 80 years. Stores are required to qualify and register as SNAP retailers to participate, but they are not responsible for enrolling individuals in the program or applying for reimbursements. SNAP users swipe a government-issued EBT card at the checkout and the funds flow directly into the store's account. Rewiring the ACP to mimic SNAP (e.g. the FCC provides ACP-enrolled households with vouchers to pay the ISPs) might reduce the administrative burden of ISPs and ultimately connect more eligible households with broadband service.
Looking Forward
The ACP is a major step forward in the nation's progress toward closing the digital divide. However, the success of the program will depend on reaching targeted residents through advertising and education. A solution to some of these challenges may be on the horizon: On Aug. 8, 2022, the FCC issued an order establishing the Affordable Connectivity Outreach Grant Program to "enlist partners around the country to help inform ACP-eligible households about the program in their local communities, and to provide those partners with the funding and resources needed to increase participation."
