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Lifeline Reforms Generate $43 Million in Savings Since January

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Released: July 31, 2012

UPDATE
Federal Communications Commission

News Media Information 202 / 418-0500

445 12th Street, S.W.

Internet: http://www.fcc.gov

Washington, D. C. 20554

TTY: 1-888-835-5322

This is an unofficial announcement of Commission action. Release of the full text of a Commission order constitutes official action.
See MCI v. FCC. 515 F 2d 385 (D.C. Circ 1974).

FOR IMMEDIATE RELEASE:

NEWS MEDIA CONTACT:

July 31, 2012
Mark Wigfield, 202-418-0253
Email: mark.wigfield@fcc.gov

REFORMS OF LIFELINE GENERATE $43 MILLION IN SAVINGS SINCE JANUARY

Reforms on track to save $200 million this year by eliminating duplicative subscriptions and


outdated subsidies

Eliminating waste, fraud and abuse protects Lifeline’s mission of helping low-income Americans


afford vital phone service
Washington, D.C. – Comprehensive reforms of the Lifeline program have saved nearly $43 million so far in
2012 and are on track to save at least $200 million this year, according to a progress report issued by the
Federal Communications Commission today.
Since 1985, Lifeline has connected low-income Americans to jobs and opportunities, family and emergency
services by helping make phone service affordable. But waste, fraud and abuse in the program were
threatening its future.
In January, the FCC completely overhauled and reformed Lifeline for today’s communications marketplace.
These reforms included eliminating unnecessary subsidies, cutting off duplicative subscriptions, and requiring
better proof of eligibility. Major savings so far this year include:
§
$26 million from elimination of most of the “Link Up” program. Link Up provided subsidies for
initial phone connections. But technology has largely eliminated the cost of initializing service.
Instead, some carriers exploited Link Up as a bounty rewarding new subscriptions. Monthly savings
from the elimination of Link Up of over $13 million were first realized in June and July, totaling $26
million.
§
$16.5 million from eliminating duplicative subscriptions. Building on efforts that began last year, the
FCC has continued to scour subscriber rolls and has de-enrolled duplicative subscriptions in 16 states,
producing substantial savings in 2012. The process continues and will generate further savings this
year and beyond.
§
$250,000 from phasing out “toll limitation” service. This program – intended originally to protect
consumers from disconnection due to non-payment of toll charges – was found to be unnecessary and
subject to abuse. It will be completely eliminated in 2014.
Additional changes – tougher proof-of-eligibility requirements, certification and recertification of
continued eligibility – became effective June 1 and are expected to reap additional savings this year.
Wireline Competition Bureau Staff Contact: Kimberly Scardino at 202-418-1442
-FCC-
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