State may permanently shrink internet and cell phone discounts for low-income Californians

“California Lifeline subsidies should be designed to ensure that ratepayer funds are used prudently and in a fiscally sound manner,”  the proposal states.  Shiroma’s staff said she was not available to answer questions about the proposal.

At least 30 members of the public wrote to the commission opposing changes to the discounts and defending their use of data.

California Lifeline subsidies should be designed to ensure that ratepayer funds are used prudently and in a fiscally sound manner.

California Public Ulitilies Commision’s proposal

Christina Moore, a Lifeline user in Los Angeles, pleaded with the commission.

“I use my phone for job hunting … I use it to talk to my doctor for my condition…This phone has been a blessing from the good Lord for me particularly in the pandemic,” she wrote. “Please do not cut our benefits and please let us use the maximum minutes and benefits from all levels of government!”

Kristin Morris, from Mission Viejo, worried about losing options for her family.

“How is it that the CA is finding new ways to make it more difficult for consumers to stay connected,” she wrote. “My kids need phones and tablets to keep up in school and complete their homework. By limiting the service plans available to low-income folks — you are making the problem worse for us, not better. This has been so important for my family —- please find a way to give us more and better service not less! With all the rising costs this is just one more expense we can’t afford.”

‘Failure to provide’

Todd Snyder from San Francisco said that restricting internet options for low-income Californians would be unfair.

“This proposed decision would exacerbate inequality and expand the digital divide for low-income Californians struggling to compete in today’s rapidly changing digital economy,” he wrote.

A few consumer advocacy groups took the opposite position, supporting the commission’s plan. They said some California Lifeline providers were charging high monthly fees for data plans that varied drastically in quality and services, and consumers weren’t always getting what they paid for.

This proposed decision would exacerbate inequality and expand the digital divide for low-income Californians

Todd Snyder, San Francisco resident

“Some providers’ failure to provide … Lifeline service of good value to customers is part of the reason why the commission is considering not allowing providers to stack California Lifeline subsidies with (Affordable Connectivity Plan) subsidies,” said Ashley Salas, an attorney for the consumer advocacy group The Utility Reform Network, based in San Francisco.

The Federal Communications Commission and the California Public Utilities Commission have set minimum service standards for Lifeline plans. Currently they call for unlimited voice and text and 6 gigabytes of data per month.

A 6GB plan allows you to browse the internet for three days, stream 1,200 songs, or watch 12 hours of standard videos, according to Reviewsa Paris-based product review website. The average American smartphone user consumed 11GB or more of data a month in 2020, but that’s expected to rise with the spread of 5G, according to Ericsona Swedish telecommunications giant.

Some objectors to the commission’s plan said today’s Zoom meetings, online courses and telemedicine sessions already require more than 6GB a month.

State officials countered that most Lifeline users don’t use all their data and the industry has failed to prove otherwise.

Nuanced views

Nathan Johnson, CEO of TruConnect, a Los Angeles-based wireless company that offers Lifeline, said many low-income people do need more data and for that reason many do not even enroll in Lifeline.

A 2019 report by the Legislative Analyst’s Office said only 40% of eligible California families enroll in Lifeline. The report posited several reasons: Families may not know about the program, they may prefer non-Lifeline plans or carriers, or they have difficulty with the program.

Johnson said TruConnect’s low-income customers often use more than 6GB a month when they are offered higher data plans, adding that the utilities commission should be more flexible.

“Why should Californians get less when they deserve more?” he asked.

Other consumer groups don’t necessarily agree. Vinhcent Le, a lawyer at the Oakland-based Greenlining Institute, said advocates’ views are more nuanced. They’re considering not just consumers of Lifeline services, but other consumers who are paying the surcharges.

“It wasn’t an easy decision to support” the commission, he said. “It always looks bad when you can’t apply more subsidies … But I think what the CPUC is trying to do here — and why we supported it — is to create a pathway where you can use your discounts more effectively and make sure there’s funding so we don’t have to increase surcharges on California consumers.”

And if Lifeline funds are used more efficiently, he said, perhaps California could lower its surcharge on its other consumers.

The commission is set to vote on the issue September 15.

Send comments to the commission.

Watch the meeting online.

The Lifeline Call Center offers assistance in 10 languages, including English (1-866-272-0349) and Spanish (1-866-272-0350).

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