Why Community Anchor Institutions Should Care About the Connect America Fund
October 12, 2017


Rural Broadband


Universal service has been a core mandate in the United States since 1934, with longstanding programs to ensure everyone could subscribe to telephone service. More recently, after passage of the Telecommunications Act of 1996, the Federal Communications Commission (FCC) created the E-rate program to help connect schools and libraries to the Internet and the Rural Health Care program to bring critical communications connectivity to clinics and hospitals in rural areas.  In 2011, the FCC transformed its existing high-cost program to subsidize voice service into the Connect America Fund, with the objective of maintaining and extending fixed and mobile broadband service to homes and small businesses in rural communities.

These three federal universal service programs – all of which subsidize the cost of critical communications services – are administered separately, with significantly different program rules, funding cycles, eligibility requirements, and vocal constituencies. It’s time to step back and ask the question of how these programs could work better together to ensure that 21st century communications infrastructure is available to everyone in rural America.

Anchor institutions like schools, libraries and health care providers play an important role in bringing connectivity to their local communities. But advances in telemedicine and education will not be fully realized if rural consumers do not have adequate broadband service at home.  School aged children will struggle if they cannot do their homework. Individuals with medical conditions that require active monitoring – diabetes, congestive heart failure and more – need broadband at home to transmit critical medical data in real time to medical professionals.

That is why local government officials and anchor institutions should be paying attention to the implementation of the Connect America Fund, now and in the years ahead. The FCC is working to hold an auction in 2018 to award nearly $2 billion in funding over the next decade from Phase II of the Connect America Fund to service providers to extend fixed broadband to unserved residential and small business locations, and a separate auction to award $4.53 billion in funding over a decade from Phase II of the Mobility Fund to mobile wireless providers to extend LTE service to rural America. Any entity willing to provide the requisite level of service set by the FCC and meet other requirements can bid in those auctions for the subsidy.

Local leaders should ask: is it possible to utilize funding in a more coordinated way from E-rate, the Rural Healthcare program, and the Connect America Fund to build a business case to serve the entire community? What efficiencies might be gained from building an integrated broadband network for the entire community? Are the service providers that currently participate in any of these FCC’s universal service programs planning to bid in these upcoming Connect America Fund auctions? Who else might bid?

The Connect America funding only will be available in specific high-cost census blocks, and likely not where most anchor institutions are located. Unfortunately, there are practical obstacles to making the various programs work effectively together, in part a reflection of their administration in separate silos and decisions made long ago on the design of each program. But the availability of this additional funding stream for infrastructure deployment in rural areas should not be ignored. It could make the difference for communities working to develop a comprehensive regional strategy to improve broadband access for their citizens.  

To learn more about the Connect America Fund, attend SHLB's Broadband4All CAF Workshop in Washington, DC on November 2, 2017. Tickets are limited so register today!


Carol Mattey is the former Deputy Bureau Chief of the FCC's Wireline Competition Bureau (2010-2017) and Senior Advisor on the National Broadband Plan (2009-2010), where she led teams working on the landmark Connect America Fund and other initiatives to modernize the FCC’s universal service programs. She currently is the principal of Mattey Consulting LLC, which provides strategic and public policy advisory services to broadband providers, governmental agencies, non-profit organizations, and other entities active in the telecommunications arena.

back to blog