House GOP wants to cap Internet subsidy budget

House Republicans are vowing to take up a bill that would set a budget cap on a program aimed at offering phone and Internet subsidies to the poor. 

Republicans on the House Energy and Commerce Committee made the announcement shortly after the Federal Communications Commission (FCC) voted to overhaul and expand the program known as Lifeline in a dramatic meeting Thursday. 

{mosads}In a 3-2 decision, The FCC voted to allow the monthly subsidies to be used for the first time to pay for Internet service instead of just for basic phone service. 

The program’s current spending is a bit higher than $1.5 billion, and the FCC expects that number to grow steadily as the new broadband offering attracts more subscribers. 

Whether to institute a cap was a sticking point that led the two Republicans on the FCC to vote against the expansion Thursday. 

They hashed out a late-night deal with Democratic Commissioner Mignon to impose a $2 billion cap on the program, but Clyburn backed away from the deal at the last minute.

“On further deliberation, I concluded such a mechanism does not fully achieve my vision of a 21st century Lifeline program,” Clyburn said. 

As it stands, the FCC proposal approved Thursday includes a $2.25 billion “budget mechanism.” If spending nears that level, the FCC will have to decide whether to increase the funding. But without a cap, Republicans said, that total could easily be exceeded even if the agency does nothing. 

The GOP bill sponsored by Rep. Austin Scott (R-Ga.) would cap the program at $1.5 billion.

It is sure to receive strong pushback from Democrats, however, and has no real chance of enactment under President Obama. 

In fact, House Democrats helped convince Clyburn break her deal with FCC Republicans a day earlier. A group of nine House Democrats on the Energy and Commerce Committee sent the FCC a late letter to “express concern” about a cap. 

“Demand is expected to increase as the program transitions to include broadband service, and any cap would threaten the goals and purpose of Lifeline,” they warned Thursday.  

“We strongly support the commission’s effort to modernize and expand Lifeline, but by establishing an artificial cap on funding from the outset, many low-income consumers could find themselves without any mechanism to bridge the digital divide,” according to the letter.