Cell phone subsidy brings mobility to those with low income

SHREVEPORT, LA (KSLA) – A program that gives free cell phones to individuals receiving government assistance had people lining up in Shreveport on Monday.

Word traveled fast, drawing a crowd outside the state office building on Fairfield Avenue.  "They was ridin up the street, yelling out the window, they're giving away free phones!" recalls Crystal Clark, as she waited for hers in the oppressive afternoon heat.

"They're 'lifeline' cell phones," explains Louis White, whose business card identifies him as the CEO of Clear Unicorp Dallas.  "We order them from China.  Everything is on the Sprint network." As an authorized agent of pre-paid cellular provider dPi Mobile, White says he gave out more than 500 of the flip phones in just a few hours on Monday.  dPi already offers lifeline service it's pre-paid land line business in Louisiana.  Now, White says, they're getting into the subsidized cell phone business.  "It just got approved to be used for cell phones and we're just now opening up in the Louisiana market. So we need to get people the cell phones."

Sharon Richardson was one of the many who filled out an application Monday and walked away with a free cell phone.  "I don't have one.  So this really will help me, for emergencies."  Clark says the free service will provide a critical connection she didn't have before.  "Like when I'm in class and my baby's in daycare and I don't have a phone or anything like that and I need to be contacted, just in case anything happens to her."

Anyone who gets any type of government assistance, such as Medicaid, food stamps or federal public housing assistance qualifies.  "You get 68 minutes a month for every month for a year to register and you have to be on government assistance," White explains.  "It has to be a needy person and then you get 68 minutes every single month for a year."

White says they get $1.50 per phone from the federal government, which subsidizes the cost of the free or discounted cell service to eligible customers through the Low Income Program of the Universal Service Fund, administered by the Universal Service Administrative Company.  According to the USAC, "It's designed to ensure that quality telecommunications services are available to low-income customers at just, reasonable, and affordable rates.  Lifeline, Link Up, and Toll Limitation Service (TLS) support provide discounts that make basic, local telephone service more affordable for more than 7 million Americans.  Approximately 1,700 telephone companies are eligible to provide these discounts."

The Universal Service Fund was established by Congress through the Communications Act of 1934.  According to the FCC, "Because telephones provide a vital link to emergency services, to government services and to surrounding communities, it has been our nation's policy to promote telephone service to all households since this service began in the 1930s. The USF helps to make phone service affordable and available to all Americans, including consumers with low incomes, those living in areas where the costs of providing telephone service is high, schools and libraries and rural health care providers. Congress has mandated that all telephone companies providing interstate service must contribute to the USF. Although not required to do so by the government, many carriers choose to pass their contribution costs on to their customers."

That's what "Federal Universal Service Fee" or "Universal Connectivity Fee" is for on your monthly land line or cell phone bill.   You may also notice a state "Universal Service" charge on your phone bill.  According to the Louisiana Public Service Commission, those funds are used to supplement federal funding dedicated to covering the extra cost of providing land line service to rural areas.

Federal regulators recently proposed tapping the Universal Service Fund as part of a push to bring high-speed Internet connections to all Americans.  The FCC wants to shift the funds from its focus on telephone service to broadband and mobile access, as telecommunications advance further into the digital age.

Click here for more information on the USAC's programs and eligibility requirements, and to find a list of approved service providers.

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