Less than a third of eligible Coloradans use federal internet rebate program

A federal program offering $30 to $75 each month to offset the cost of broadband internet service has attracted less than 30% of eligible users in Colorado since it launched in January.

But that fraction includes 132,060 Colorado households who have enrolled in the Affordable Connectivity Program, as of May 9. The program, which started last year to help low-income families pay for internet access, is available to those eligible for government assistance programs, such as food stamps, free or reduced school lunch and Medicaid. There are about 1.4 million Coloradans on Medicaid.

The $14 billion program, funded by the trillion-dollar infrastructure bill passed by Congress last year, replaced the Emergency Broadband Benefit, which provided $50 a month to low-income families. EBB ended Dec. 31 and ACP took over as a permanent replacement, offering $30 to most participants and $75 to those living on tribal lands. Discounts on devices were part of both programs.

“The bipartisan Infrastructure bill is a big win for Colorado, especially because it will connect every house to high-speed internet. But a connection isn’t any use if you can’t afford the service,” Sen. John Hickenlooper said in an email.  “We are working to get the word out and urge every Coloradan who thinks they might qualify to go to GetInternet.gov.”

A marketing campaign kicked off this week to help spread the word. President Joe Biden held a news conference on Monday to announce that 20 internet companies that cover 80% of America agreed to provide 100 megabit service for less than $30 so that the subsidy makes the internet service free. 

Comcast, one of the largest internet providers in Colorado, was among the companies getting costs down. Much of its low-income plan targets urban areas where the digital divide is the result of cost, not the availability of service. The Internet Essential plan — which is now at 50 megabits per second but has stayed at a steady $9.95 for years — added a “Plus” tier, offering 100 mbps for $29.99. 

“If you apply the ACP credit, then that is free,” said Leslie Oliver, a Comcast spokeswoman. “From our perspective, this addresses some of the affordability issues that are reasons why people don’t connect.”

Dozens of community internet providers in Colorado are participating in ACP and many have their own subsidized programs. Fort Collins Connexion, a city-operated internet service that launched service in 2019, created a digital-equity program in 2020. Low-income residents can get gigabit internet for $19.95, said Erin Shanley, Connexion’s broadband marketing manager. 

“I was actually just remarking this to my executive editor today that Comcast, Verizon and a few others are like ‘We’re going to give you 100 megabits for $30,’” Shanley said. “We’re giving 1,000 megabits for $20.” 

With ACP, Connexion’s digital-equity service is free. Connexion also pre-approves customers so they don’t have to apply separately on the federal site.

Early hiccups

So far, ACP’s enrollment is outpacing EBB by 30% in Colorado. That may be due to rollout complications when EBB launched. Consumers had to get approved through the Universal Service Administrative Company. But typing in information had to be exact — such as typing “Street” instead of “St.” — otherwise, the application resulted in an error. 

The registration process has since been smoothed out, said Sarah Fishering, with Clearnetworx, a fiber-internet provider in Montrose. “Literally, I’ve seen a customer do it in less than 15 minutes.”

It’s some of the behind-the-scenes processes that haven’t worked as easily. Ciello, which provides broadband service in the San Luis Valley, can’t get an answer as to why two ACP customers suddenly dropped off the list in April so Ciello wasn’t reimbursed. 

“They (customers) didn’t know why and we didn’t know why,” said Jennifer Alonzo, Ciello’s marketing and sales coordinator. “We still gave them the credit even though we won’t be reimbursed for it. … It’s difficult to get support from anyone. We reached out through an email on something and I think it took five weeks before we heard back.”

Fishering said the family-run Clearnetworx had similar problems with EBB and couldn’t figure out how to get reimbursed after covering the cost for customers. However, by jumping into EBB early on, that helped attract customers who’ve continued under ACP.

“We didn’t have to throw the baby out with the bathwater and we can just move forward with a process that we now know works,” she said. “That gives us the opportunity to really communicate a lot about the program and get that benefit to as many people as possible.”

For consumers with no internet access or limited access or who are having trouble applying online, there may be in-person options. Comcast encourages potential customers to stop by a Comcast Xfinity store. 

Clearnetworx said it’s been helping customers in person since EBB started. 

“We have some customers who may have more technological challenges or maybe they really have no access to any way of being able to get on to that application process online,” Fishering said. “We have them sit with a (customer service representative) in person — that’s a requirement of the program — and go through the question-and-answer process,  kind of interview style.”

Not a profit maker

Internet service in sparsely populated areas is slow, expensive and offers few options. In the state’s least-populated counties, there’s only one household per county enrolled in ACP as of May 9, according to federal data. 

And in those counties, satellite internet may be the only option. Hughes Net, which is participating in ACP, is $64.99 per month for the company’s 15 GB plan offering download speeds of 25 mbps, according to the company. There are also extra costs for the equipment. 

It’s certainly not a new revenue stream for internet companies, said Monroe Johnson, Ciello’s chief technology officer. 

“We do it as a community service and because of who we are,” Johnson said. “It actually increased costs to the provider for no additional money.”

Ciello’s lowest-priced plan is $42.95 for 25 mbps up and down for fiber users. That means ACP customers still pay about $13 a month, though some customers opt for faster and more expensive plans because they are able to qualify for the ACP benefit. 

Local providers like Ciello already work with community organizations to provide internet. The company installed Wi-Fi access points at the Boys and Girls Clubs in Alamosa, and in other locations around the San Luis Valley. 

Clearnetworx has what it calls a connecting-students program that’s open to school district staff and students. They can get a $5 to $10 discount, which would be in addition to the ACP benefit, and it has a different program providing free internet to students eligible for free or reduced lunch, which is considered a measure of poverty.  

And Live Wire Networks works with the Boulder Valley School District to provide internet service to any family that had a student on the free or reduced lunch program. It also invested early on in becoming a Lifeline provider, so it receives federal funds for serving low-income mobile phone and voice customers. 

It still costs the company staff time and effort to process ACP claims and respond to questions, but this aligns with what they’re already doing in the community to build better broadband and attract new customers, said Jim Hinsdale, Live Wire’s president.

“We want to be a contributing part of the community. And there’s good economic sense to do it,” Hinsdale said. “Especially in working with the schools, that was a free service. We’re trying to figure out any way we can monetize that arrangement because we’re having to pump a lot of money into towers and conduit and build out. This helps balance that out.”

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