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Here’s how the government wants to help America’s poorest get online

(Chris Goodney/Bloomberg)
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Federal regulators unveiled a final plan Tuesday that would offer low-income Americans a new discount on broadband service — a $9.25 subsidy a month — in an effort to spark an explosion in high-speed Internet adoption among the poor.

The Federal Communications Commission hopes that amount would enable the underprivileged to gain greater access to what has become a vital tool for education, entertainment and economic prosperity.

“We’re talking about real people,” FCC commissioner Mignon Clyburn said in an interview. “These are the people who need broadband the most — and they are on the wrong side of the digital divide.”

The proposal would revamp an existing program known as Lifeline, which currently gives $9.25 a month to eligible households to spend on telephone service. Changes to the program would allow Americans to spend the subsidy on fixed, wired broadband as well as cellular data plans — which they previously have not been able to do. It would even allow low-income customers to apply the discount toward bundles of fixed and mobile Internet service.

Internet providers that accept Lifeline customers would be required to provide them with download speeds of at least 10 Mbps and upload speeds of at least 1 Mbps, according to the proposal. Cellular service providers, meanwhile, will be expected to give Lifeline subscribers 500 MB of data at 3G speeds to start — a figure that would gradually rise to 2 GB by the end of 2018.

Wealthier populations have migrated online with relative ease. But the poor have largely been left behind, wrote FCC Chairman Tom Wheeler and Clyburn in a blog post Tuesday.

“Internet access has become a pre-requisite for full participation in our economy and our society,” they wrote, “but nearly one in five Americans is still not benefitting from the opportunities made possible by the most powerful and pervasive platform in history.”

Agency officials frequently cite the lack of broadband as a major impediment to economic growth, particularly among the poor. Reports of low-income children relying on public WiFi at fast-food restaurants for their homework needs has led to what FCC commissioner Jessica Rosenworcel calls a “homework gap” that prevents poorer school kids from catching up with their richer peers.

In order to qualify for the broadband discount, consumers would need to show that they fall below a certain income thresholds or receive food stamps, disability benefits, or participate in Medicaid — much like in prior incarnations of Lifeline. But they will no longer need to sign up at hastily-built tents in public parking lots or hand over extremely sensitive personal information, senior agency officials told reporters Tuesday, eliminating what many subscribers have come to view as a demeaning, embarrassing experience.

The FCC’s proposed reforms would seek to make using the subsidy about as seamless and mundane as swiping a magnetic food-stamp card at the grocery store. Much like their wealthier counterparts, Lifeline beneficiaries would be able to walk into a cellular provider’s retail store, for example, sign up for service and take advantage of the monthly federal benefit by handing over their driver’s licenses.

That information would be cross-referenced with their existing federal assistance records in a new, national database. Officials say this approach will help cut down on the kind of duplicate applications that led to massive waste, fraud and abuse of the Lifeline program.

Conservatives have slammed Lifeline in general — and the FCC’s latest proposal in particular — for driving up federal spending.

"It's a recipe for disaster," said Republican FCC commissioner Michael O'Rielly last week, "and I can't and won't be a part of it."

The version of Lifeline being proposed internally at the FCC this week has a budget of $2.25 billion, roughly 50 percent more than its current spending levels, according to senior agency officials. With that extra money, the FCC expects to be able to subsidize another 5 million low-income Americans’ Internet annually before nearing the cap, which can be adjusted. But that would still leave about 8.5 million low-income Americans remaining, according to FCC figures.

The FCC’s five commissioners are expected to vote on the proposal at their next public meeting on March 31.