The Federal Lifeline and Link Up Telephone Discount Programs

1
The Federal Lifeline and Link Up Telephone
Discount Programs

• South Carolina Training Presentation
• Universal Service Administrative Company
• January 16, 2009

2
Overview Of USAC

• USAC overview
• USACs role in administering Lifeline and Link Up
• Lifeline and Link Up
• South Carolina participation rate
• Advertising guidelines and best practices
• New resources
• Q A

3
USAC and the Universal Service Fund

• USAC is an independent, not-for-profit
  corporation designated as the administrator of
  the federal Universal Service Fund by the Federal
  Communications Commission (FCC)
• The Universal Service Fund (USF) is one fund with
  four programs
• USAC administers support programs for
• High cost companies serving remote and rural
  areas
• Low-income consumers
• Schools libraries
• Rural health care providers
• Through USAC, the USF provides communities across
  the country with affordable telecommunications
  services
• In 2007, USAC disbursed an estimated 822.7
  million Low Income Support

4
One Fund Four Programs
5
USACs Role

• USACs functions and responsibilities include
• Administering each of the universal service
  programs
• Billing contributors, collecting contributions,
  and disbursing universal service support
• Reporting quarterly to the FCC on disbursement of
  universal service support
• USAC may not
• Make policy
• Interpret unclear provisions of the statute or
  rules
• Interpret the intent of Congress
• Advocate policy positions before the FCC or its
  staff, but may advocate positions on
  administrative issues relating to the programs

6
USACs Role Low Income

• Process support claims
• Disburse Lifeline, Link Up and TLS Support
• Promote awareness of FCC USF rules and
  regulations
• Provide information to stakeholders
• ETCs
• Consumers
• FCC
• State Commissions

7
Low Income Program

• The Low Income Program, commonly known as
  Lifeline and Link Up, provides discounts that
  make basic, local telephone service affordable to
  help over 7 million low-income consumers stay
  connected

8
Low Income Components

• Lifeline
• Reduces eligible consumers' monthly charges for
  basic telephone service
• The maximum federal support available for
  customers in South Carolina is 10.00
• The maximum discount a consumer may receive in
  South Carolina is 13.50

9
Low Income Components

• Lifeline support is broken down into four tiers
  of support
• Tier 1 support available to all eligible
  Lifeline subscribers, is equal to the incumbent
  eligible telecommunications carrier's (ETC's)
  actual federal tariffed subscriber line charge
  (SLC). The SLC rate, and therefore Tier 1
  support, is capped at 6.50
• Tier 2 support an additional 1.75 per month of
  federal Lifeline support, is available if the
  carrier certifies that it will pass through the
  full amount of Tier 2 support to its qualifying
  low-income consumers and if the carrier has
  received any non-federal regulatory approvals
  necessary to implement the required rate
  reduction

10
Low Income Components

• Lifeline (continued)
• Tier 3 support an additional amount of federal
  Lifeline support equal to one-half the amount of
  any state-mandated Lifeline support, or one half
  of any Lifeline support provided by the carrier,
  up to a maximum of 1.75 per month
• Tier 4 support additional federal Lifeline
  support of up to 25 per month available to
  eligible residents of tribal lands, as defined in
  47 C.F.R. 54.400(e), as long as that amount
  does not bring the basic local residential rate
  below 1 per month per qualifying low-income
  subscriber

11
Low Income Components

• Link Up
• Reduces the cost of initiating new telephone
  service
• 1/2 of the customary telephone connection charge,
  up to a maximum of 30.00
• A deferred schedule for payment of the charges
  assessed for initiating telephone service, for
  which the consumer does not pay interest
• Interest charges not assessed to the consumer
  must be for connection charges up to 200 that
  are deferred for a period not to exceed one year

12
Low Income Components

• Toll Limitation Service
• Allows eligible consumers to subscribe to toll
  blocking or toll control at no cost
• Consumers must voluntarily elect toll blocking
• Carriers may only claim their incremental cost of
  providing TLS
• Carriers may NOT claim their tariffed rate

13
Consumer Eligibility

• States that mandate their own Lifeline program
  can create their own eligibility criteria based
  on income or factors directly related to income
• In South Carolina, a consumer must participate in
  one of the following programs
• Food Stamps
• Medicaid
• Temporary Assistance for Needy Families (TANF)
• Meeting the 125 Federal Poverty Guideline
  (ATT/Bell South)

14
South Carolina Office of Regulatory Staff

• The Office of Regulatory Staff (ORS) regulates
  incumbent and competitive local exchange carriers
  (ILECS and CLECS) and intrastate long distance
  carriers in South Carolina.
• ORS provides oversight and governance for local
  telephone service in South Carolina.
• The SC Universal Service Fund and Interim LEC
  Fund provide funding to bring telecommunications
  services to rural areas.
• Consumers may contact the ORS to obtain a
  Lifeline and Link Up application.

15
South Carolina Low Income Statistics

• In 2008
• There were 29 Eligible Telecommunications
  Carriers (ETCs)
• All 29 ETCs received Low Income support
• 5,043,890 in Lifeline support was disbursed
• 822,495 in Link Up support was disbursed
• Approximately 45,634 households received Lifeline
  support

16
South Carolina Low Income Participation

• South Carolinas participation rate is relatively
  low
• Participation rate for South Carolina is
  approximately 11.97 (based on July 2007 data
  when there were 228,015 eligible households for
  support)
• USAC estimates that in 2007 there were 200,728
  eligible, non-participating households, in South
  Carolina

17
South Carolina Low Income Participation

• Possible reasons why participation is low in the
  State of South Carolina
• Low awareness of programs
• Low awareness of enrollment procedures
• Unsuccessful advertising
• Limited eligibility criteria
• Limitations on Lifeline service

18
Outreach

• FCC rule on outreach requires carriers to
  publicize the availability of Lifeline service
  in a manner reasonably designed to reach those
  likely to qualify for the service. (47 C.F.R.
  54.405(b))
• The Lifeline and Link Up order released in April
  2004 offers guidelines for effective outreach
• Requirement to publicize Lifeline is mandatory
• Guidelines are recommended, rather than mandatory
• States and carriers have flexibility to determine
  most appropriate outreach mechanisms

19
Outreach Guidelines

• Recommended Guidelines
• States and carriers should utilize outreach
  materials and methods designed to reach
  households that do not currently have telephone
  service
• Notices at public transportation, shelters, soup
  kitchens, public assistance agencies
• Public service announcements
• Bill inserts and advertising in telephone books
  are not likely to attract individuals who do not
  have phone service
• Internet notice should not be the primary means
  of outreach

20
Outreach Guidelines

• Recommended Guidelines (continued)
• States and carriers should develop advertising
  that can be read by members of any sizeable
  non-English speaking populations
• Offer toll-free number in other languages
• Make available applications in other languages

21
Outreach Guidelines

• Recommended Guidelines (continued)
• States and carriers should coordinate their
  outreach efforts with governmental agencies that
  administer any of the relevant government
  assistance programs
• Social service agencies
• Tribal organizations
• Community centers
• Organizations such as AARP, United Way

22
Outreach Guidelines

• Recommended Guidelines (continued)
• States and carriers should utilize USAC as a
  resource
• Carriers can post information on USACs
  consumer-oriented web site, http//www.lifelinesup
  port.org
• USAC works with carriers, associations, tribal
  organizations and consumers

23
Best Practices

• Traditional methods
• Word of mouth
• Third party agencies
• Brochures
• Bill Inserts
• Television advertisements
• Radio advertisements

24
Best Practices

• Traditional methods (continued)
• Newspapers
• Local newspapers
• Press releases
• Traditional advertisements
• Newspapers geared towards non-English speakers
• Widely utilized in some minority communities
• PennySavers
• Free to customers

25
Best Practices

• Non-traditional Methods
• Enroll customers as they enter or leave social
  service agencies
• Canvas neighborhoods that may have a high
  population of eligible consumers
• Establish relationships with community schools
  and public housing directors
• Cash incentives for employees and social service
  agencies

26
Best Practices

• Non-traditional methods (continued)
• Provide applications at municipal events, fairs
  and other venues where there are activities
  targeted towards lower income individuals
• Allow Lifeline and Link Up applicants to enroll
  at targeted retail outlets
• Carrier retail locations or business offices
• Western Union locations
• Check cashing stores
• Rent to own stores

27
DTV Transition

• As of April 30, 2008, all ETCs must advertise the
  February 2009 television broadcasting transition
  from analog to digital service DTV transition.
• All outreach materials must convey at least the
  following information
• After February 17, 2009, a television receiver
  with only an analog broadcast tuner will require
  a converter box to receive over-the-air
  broadcasts with an antenna because of the
  Nations transition to digital broadcasting.
  Analog-only TVs should continue to work as before
  with cable and satellite TV services, gaming
  consoles, VCRs, DVD players, and similar
  products.
• Information about the DTV transition is available
  from http//www.dtv.gov and from
  http//www.dtv2009.gov or 1-888-DTV-2009 for
  information about subsidized coupons for
  digital-to-analog converter boxes.

28
DTV Transition

• All Lifeline and Link Up outreach materials must
  contain DTV transition language
• ETCs must send monthly notifications to their
  Lifeline and Link Up customers from April 2008
  through March 2009
• Bill inserts
• Language on a monthly bill
• Brochures
• Postcards
• Any other medium used to communicate with
  Lifeline and Link Up consumers

29
USAC Resources

• Lifelinesupport.org
• Carriers can post customized information on
  USACs consumer oriented website
• Brochures
• Non-tribal and tribal
• Includes federal default criteria
• Consumer Outreach letter
• Can be customized for specific telephone company
• Federal default state and non-default state
  versions available
• Spanish language overviews outreach letters are
  available on USACs website.

30
Low Income Program Initiatives

• USACs online disbursement tool
• Allows ETCs to view disbursement amounts several
  days before payments are made
• Allows ETCs to track historical disbursements
  dating back to 2004
• Shows how a disbursement amount is calculated
  (i.e., based on projection or true-up)

31
Improving Communication

• Website Revitalization
• Newsletters
• Training
• Fund Facts
• Annual Report
• Site Visits

32
Question and Answer Session
33
Thank You
Visit us on the Web at www.usac.org
Pamela Gallant Director, Low Income
Program pgallant_at_usac.org Tanea Davis Program
Manager, Low Income Program tdavis_at_usac.org Fades
ola Adetosoye Asst. Program Manager, Low Income
Program fadetosoye_at_usac.org