The Supreme Court ruling that helps keep internet affordable in Pennsylvania, explained

A federal fund dedicated to providing affordable phone and internet services will continue as planned after the US Supreme Court denied a challenge brought by an advocacy group.

Conservative education nonprofit Consumers’ Research had sued on the grounds that the Federal Communications Commission’s $8 billion Universal Service Fund was unconstitutional. The late June ruling allows the program to keep subsidizing communications services for underserved communities nationwide, including Pennsylvania. 

The court decision allows the commonwealth’s 300,000-plus households that don’t have adequate access to the internet to continue having affordable options, especially as other subsidy programs face cuts. 

What did the Supreme Court decide?

In a 6-3 decision handed down on June 27, the court denied Consumers’ Research’s challenge, meaning the Universal Service Fund (USF) will continue as planned to provide subsidized phone, internet and other communications services. 

“Congress … struck a balance in establishing universal service’s metes and bounds — affording the FCC latitude to adapt to technological developments, but insisting that the FCC always look to whether services are essential, affordable and widely used,” Justice Elena Kagan wrote in the court’s majority opinion.

How does the Universal Service Fund work?

The USF is an $8 billion pool that provides money to make phone and internet more affordable and accessible. Its roots trace back to the Communications Act of 1934, which said all Americans “shall have access to rapid, efficient, nationwide communications service with adequate facilities at reasonable charges.” 

With the Telecommunications Act of 1996, the fund was expanded to include access not just for residents with lower incomes but also for schools, libraries and rural health providers.

While the USF supports multiple programs, the most direct benefit for consumers is the Lifeline program.

Who benefits from the Lifeline program?

The USF’s Lifeline program offers a monthly benefit of up to $9.25 toward phone and internet bills for people whose income is at or below 135% of the poverty guidelines, or people who already qualify for programs such as SNAP or Medicaid. 

Who pays into the USF?

The Telecommunications Act of 1996 requires interstate telecom companies to make quarterly contributions to the USF. Most big service providers in the United States are required to participate, with a few exceptions for government entities and certain nonprofits.

While the dollars are delivered to the fund via corporations like AT&T and Verizon, the money ultimately comes from fees on consumers’ phone and internet bills.

Doesn’t PA have its own fund like this?

The federal USF is separate from the Pennsylvania Universal Service Fund, which is run by the PA Public Utility Commission and reduces charges for long-distance calls. 

What is Consumers’ Research and when did the legal fight start?

Consumers’ Research was founded in 1929 by F.J. Schlink and Stuart Chase, authors of Your Money’s Worth, a book on consumer product testing. The company was part of the consumer protection movement and published a monthly bulletin that shared reviews of products. 

Journalist and conservative leader Medford Stanton Evans purchased the org in 1981, shifting its focus from product testing to consumer activism. Consumers’ Research is now focused on fighting environmental, social and corporate governance initiatives and launched a campaign against “woke” companies under the current executive director, Will Hild.

Today, Consumers’ Research donates to groups like the State Financial Officers Foundation, a Republican-led fiscal policy management organization. Over the years, Consumers’ Research has targeted many major companies like BlackRock, Vanguard and Major League Baseball for “woke” programs, ranging from environmental protection initiatives to voting rights efforts.

Consumers’ Research is not legally required to reveal where it gets its funding from. Groups like DonorsTrust, which obscure the identity of individual donors, are the biggest financial contributors to Consumers’ Research, according to IRS filings.

Organizations like progressive advocacy org the Center for Media and Democracy and Monitoring Influence, which investigates dark money, have come out against Consumers’ Research.

The organization sued the FCC over the Universal Services Fund in 2021. The case traveled through the Fifth Circuit (centered in New Orleans) before landing at the Supreme Court. 

What other help is on the way for Pennsylvanians?

Pennsylvania is set to receive $1.16 billion through the federal Broadband, Equity, Access and Deployment (BEAD) program. This money will build broadband infrastructure in unserved and underserved parts of the state. 

But digital equity initiatives have been under fire recently. The Affordable Connectivity Program (ACP), an internet subsidy program, ran out of funding last year, leaving 763,000 households in Pennsylvania with higher internet bills. At the time, Senator John Fetterman introduced a bill that would make the ACP part of an existing program, but there has been no movement on the legislation since then.  

Earlier this year, the federal government halted funding allocated under the Digital Equity Act, which was going to provide $25 million to Pennsylvania for digital literacy programs, device distribution and internet subsidies, among other initiatives.