Internet subsidies for low-income families could shrink

In July 2021, Gov. Gavin Newsom signed into law a $6 billion statewide plan to expand high-speed internet infrastructure in rural and other under-resourced regions.

And from May 2021 until March of this year, the state allowed low-income families to leverage up to $75 a month in discounts from state and federal subsidy programs, to buy internet and cell phone services. Qualifying households could “stack” the subsidies from three programs, two federal and one state, to reap those savings.

CalMatters reports this month state regulators are considering curtailing some of their savings.

The California Public Utilities Commission is expected to vote on a new rule that would limit how much communication companies could make from the state’s Lifeline program, which provides discounts to low-income households for home phone and cell phone services.

Under the new rule, low-income California households who qualify for federal help to pay for phone service and internet access would lose some or all of their California Lifeline monthly discounts. The result: Instead of being able to stack three discounts, most California Lifeline users would be limited to two, for a total of up to $39.25 in discounts a month.

The companies that serve Lifeline customers, and some of their clients, are contesting the change, contending that it would cost low-income consumers money and limit what cell and internet services they can buy.

Some 1.7 million California residents are enrolled in the state’s Lifeline program, which is an offshoot of the federal Lifeline program. Commission staff predicted the proposed change could result in more money being available to spread services to more low-income residents.

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