Outsourcing the approval process to the federal government has been a failure.
Florida, like every state in America except Montana, has a Lifeline program that provides subsidized, discounted mobile phone service to low-income individuals to help in case of emergencies, to set up job interviews and take care of other basics. The federal subsidies for the program come from taxes on cell phone service providers, who pass those charges onto their customers.
In Florida, cellular service companies previously had to be approved by the state government in order to provide Lifeline service. A few years ago, the state legislature thought the process would be more efficient if it outsourced the Lifeline provider approval process to the federal government, which handles the process for many other states. Unfortunately, since 2012 the federal government has not approved any new Lifeline providers in Florida. As a result, in some parts of Florida, people eligible for the program may find that it difficult to get quality cell service from companies approved for the program.
In Florida only 29 percent of individuals eligible for the Lifeline program actually receive the cell phone service. That low rate of enrollment suggests not only are Florida’s full-price phone users paying a federal tax to help pay for the Lifeline program, but much of that tax money is likely heading to Lifeline program recipients in other states.
One could make the case that this federal program is not the most effective way to help low-income families get cell phone service. Setting that aside, since Florida’s cell phone customers are being taxed by the federal government to fund the program, taxpayers should expect the government to run it as effectively and efficiently as possible.
Granting one or two phone companies defacto monopolies in parts of the state while they offer lousy service to customers is foolish and wasteful. The more competition amongst cell phone companies there is, the more likely Lifeline program users are to receive quality cell phone services and options and ensure that people eligible for the program have a real opportunity to use it if they want to.
To that end, the Florida House is currently considering a bill, HB1381, that would return the Lifeline program approval process to the state. The goal should be, and is what the bill sponsors seem to intend, to substantially expand the number of cellular companies in Florida that provide Lifeline services. It makes sense to undo the mistake of trusting the federal government to run this program effectively or to ensure Floridians eligible for the program have viable options to choose from.
If the program is going to exist, Florida should make sure it spends taxpayers’ money wisely and that the program’s recipients get quality services that actually help them overcome challenges and improve their lives.
Spence Purnell is a policy analyst at the Reason Foundation, where he works on pension reform, Florida policy issues and economic development.