Rural Internet Service Threatened After State Slashed Subsidies


Rural areas have been struggling to receive a decent internet connection. Unfortunately, some Texans living in the rural area is facing a bigger problem. The state recently decided to slash subsidies responsible for helping providers offer internet and phone service in densely populated areas. Over a million Texan households are located in rural areas, where phone and internet services are very costly. For the past five years, the Texas Universal Service Fund covers the reimbursement for telecommunication companies.

Unfortunately, the fund has been losing a massive amount of money, resulting in the state slashing subsidies. The Public Utility Commission of Texas that oversees the fund stated that they could only provide 30% to 40% reimbursement for the telecommunications company. This funding problem left the companies with no choice but to stop developing networks for potential consumers.

According to Texas Telephone Association’s President and Big Bend Telephone Co.’s CEO, Rusty Moore, this issue will also affect their service lines’ maintenance costs. Small companies are likely to go out-of-business soon. Emergency services like 911 are also at risk. He also mentioned that Big Bend is somehow responsible for border security, and the investments for their network are already in jeopardy. The state typically provides Moore’s company around $300,000 every month. Unfortunately, they only received $100,000 recently for their monthly payment.

Last July 2020, Public Utility Services anticipated that the fund could lose all of its money at the end of the year. Telecommunication companies and Texas legislators requested the commission for an increase in voice calls assessment or other types of calls to generate money for the fund. However, the commission did not make any changes ever since they submitted the filed requests. The commission spokesperson refused to give a statement regarding the matter.

These services are crucial in every household during the COVID-19 pandemic. Almost everything is dependent on internet access, starting from online classes to work meetings. State Representative James White, R-Hillister, released a statement mentioning the importance of reliable internet connections during this difficult time. Even senior citizens rely on a good internet connection for their medical concerns, while students and teachers need it for education. It is also crucial to keep the Texans connected to their loved ones away from them.

White also mentioned that rural businesses would be affected by network loss. Most of these businesses belong to industries that can affect the entire state. He also urged the commission to stop supporting rural areas that are now considered suburban and exurban and divert the fund to those in need. The said fund also provides phone services support (Lifeline) for low-income Texans and Relay Texas, supporting people who have hearing and speech disabilities.

Along with other telecommunications companies, Moore’s company filed a lawsuit that claims the commission violated some Texas rules when they slashed subsidies. Moore said he is hoping that the suit will force the commission to act upon the funding issues.

It would be a shame to lose the program due to a lack of funds. The commission can do something about it to save it, yet we are still waiting for further actions they are going to take. Leaving rural Texan households out of internet and phone services is something any rural area can experience. We should not wait until every rural area gets disconnected from the whole world.