FCC Adopts High-Cost ACP Benefit

On August 4, 2023, the FCC released a Sixth Report and Order (“R&O”) adopting rules to establish enhanced discounts for monthly broadband services provided in high-cost areas by Affordable Connectivity Program (“ACP”) participants.  The R&O was adopted at the August Open Meeting.

The R&O allows ACP participants to provide a monthly benefit of up to $75 per month (as opposed to the normal $30 per month) to homes in high-cost areas upon a showing of “particularized economic hardship.”  Specifically, the R&O adopted the following:

  • Eligibility:  The enhanced $75 benefit will only be available for facilities-based providers serving high-cost areas.  The R&O defines “high-cost area” as those areas identified as a high-cost area by NTIA under the BEAD program.
  • Particularized Economic Hardship:  The R&O defines particularized economic hardship by focusing on the provider’s operating costs and revenues in the high-cost area(s) where the provider seeks approval to offer the high-cost area benefit.  Providers must demonstrate they are unable to cover the cost of maintaining the operation of all or part of its broadband network in a high-cost area where it seeks to offer the benefit.  In making this determination, providers are required to factor in the standard $30 monthly ACP benefit as well as other financial benefits and subsidies (including USF high-cost support).  To demonstrate particularized economic hardship, providers must submit an affidavit supported by an income statement that demonstrates that the provider’s broadband revenue has been below broadband expenses in the last four of the last six fiscal quarters or for the full fiscal year for each area.
    • Annual Resubmission:  Participating providers approved for the high-cost area benefit must annually resubmit their showing of particularized economic hardship to demonstrate continued eligibility to offer the high-cost area benefit.  Providers that fail to submit their annual resubmission or no longer qualify for the high-cost benefit will be required to notify households with the benefit that the benefit will be ending 30 and 15 days prior to the last date that the provider is authorized to offer the benefit.  Providers also may transition such households to other service plans covered by the standard ACP benefit.

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